BANK OF NEW ZEALAND.

Dominion, Volume 1, Issue 38, 8 November 1907, Page 4

BANK OF NEW ZEALAND.

Ever since the State came to the assistance of this institution in 1894, it has been persistently maintained that the Bank was free from political interference, that its management was in no way dictated by the Colonial Treasurer. The public generally have accepted these assurances, hut it now seems that members of Parliament, who would be.expected to know better, accept them cum grano salis, for a deputation 'of thirty-five members waited on the Premier on "Wednesday last, and .urged him not only to interfere with the management of the institution, but also to confiscate the property of the shareholders. The capacity for mischief of the member of Parliament, who fancies he knows all about high finvery considerable. The' thirtyfive financial authorities, who waited ifpon the Premier on the occasion under review, urged four points', and we have no doubt they would consider they were suggesting " reforms." They asked, first of all: ''To place -public share-

holders on the same footing as private shareholders as to dividend." The public shareholders are. hot, as iriay he imagined, a number of' ill-used ■ individuals, but the State. By the Bank of New Zealand Act, 1903, the Grown became possessed of 75,000 fully paidup preference shares of the nominal amount of £6 13s. 4d. each, thus representing £500,000, and it was provided in respect to these preference shares that they shall, be subject to no liability, whether in the event of the winding-up of the Bank, or otherwise, and shall confer no voting power. In respect of capital, they rank in priority to ordinary shares. In respect of dividends, they rank in priority to ordinary shares to the extent of £5. per cent, per annum (now cumulative), and equally with ordinary shares, for anyexcess above 5 per cent., but the maximum dividend bn the preference shares is not to exceed 10 per cent. It is provided in Sub-section E of clause. 10 that, in declaring dividends in excess of £5 per cent., then with respect to the excess (but to the excess only), the ordinary shares shall be entitled to dividends ,at twice the rate of the dividends on the preference shares. During the past financial year,. the dividend on the preference shares was per cent. The Prime Minister of the Dominion is asked to break this compact, and to confiscate profits, simply because thirty-five members of' Parliament with revolutionary notions of high finance think it ought to be done. It is a scandal that the Government can scarcely be prepared to perpetrate. The second proposal reads: "To reduce charges to the public for banking services"—as abolition of charge for keeping school committee's account, exchange on cheques, etc., and the third proposition was to reduce charges for making advances to local bodies. Why should the Bank of New Zealand, any more than any other of our banks, reduce its charge for banking services ? The bank has a right to be paid for banking services quite as much as a member of Parliament has for political services. The latter raised his charge in quite an arbitrary way by 25 per cent., but the bank must notcven get a reasonable price' for its services. The bank must practically keep the books of small- local bodies and charge them nothing for it. Exchange on cheques, the annual charge for keeping accounts, arid the interest on loans or advances are sources of income, and why Parliament should interfere in this matter is beyond comprehension. The Premier's attitude towards the deputation is somewhat disquieting. His promise to give consideration to the representations made, though non-com-mittal enough, will occasion uneasiness. We are inclined to think, however, that the reply given means nothing more than the customary courteous Ministerial dismissal of the subject.