B—6

effected by the issue in New Zealand of stock totalling £29,618,000 at per cent., the stock being taken np mainly by the Reserve Bank, but partly by Treasury Accounts. The net saving in interest on this transaction is approximately £605,000, but the main benefit is the elimination of overseas interest totalling £1,330,000, which, coupled with the annual saving of £675,000 in connection with the Memorandum of Security repayment, gives a net reduction in overseas debt charges of over £2,000,000 per annum. ißank of N.Z. shares It will be noticed that £7,038,000 of the increase in the debt for last financial year was for purchase of Bank of New Zealand shares. Following the passing of the Bank of New Zealand Act, 1945, shareholders on the New Zealand register were given till the 31st January, 1946, to indicate the form of settlement desired, and ~fche major portion of the work was completed in time for incorporation in the accounts at 31st March last. The offers to the overseas shareholders in London and Australia closed on the 31st March, 1946, so that in neither of these cases is any portion of the transactions reflected in the accounts. The following shows the position to date of completed purchases:— £ Shares previously held by State .. .. .. .. 2,109,375 .Shares acquired under 1945 Act— £ In New Zealand .. .. .. .. 3,528,894 Overseas holdings .. .. .. .. 653,765 4,182,659 Overseas holdings still held privately .. .. .. 36,091 Total subscribed capital .. .. .. .. £6,328,125 An additional 6,640 shares have been purchased by the Government, but have not yet been actually transferred. The shares transferred have been paid for as follows: — £ Tax-free stock 3 per cent., 1957 .. .. .. .. 1,658,430 Ordinary stock 3 per cent., 1957-60 .. .. .. 6,466,925 London Register New Zealand Government stock 3£ per cent., 1962-65 .. .. .. .. .. .. 804,157 Cash .. .. .. .. .. .. .. 1,138,523 £10,068,035 Interest on stock issued will be offset by dividends received. I would take this opportunity of paying a tribute to the directorate and administration of the Bank, which have served for so many years as an integral part of the national economy of the Pominion, and to thank those directors who are remaining in office.

19