EQUITABLE BUILDING COMPANY

Dominion, Volume 8, Issue 2375, 3 February 1915, Page 3

EQUITABLE BUILDING COMPANY

REVIEW OF THE YEAR POSSIBLE EFFECTS OF WAR The annual meeting of the Equitable Building and investment Company, Ltd., was held last night. Mr. E. Balcombe Brown, chairman of directors, presided. Tbo chairman, in moving the adoption of the report and balance-sheet, discussed in some detail the position of tbo company and tbo probable future state of tbo money market consequent on tho war. "I desire," ho said, "to congratulate shareholders on tho satisfactory results of tho past year's business. After providing for the usual, dividend, the reserve fund has been increased by a sum of £2000, and the sum of £3286 19s. 7d. is carried forward to next year's profit and loss account. It is not customary for the chairman of this company to review the commercial outlook of the oountry except with regard to matters directly affecting the money market in such a way as-to be likely to prevent the mombers of the community from saving money and depositing their savings Owing to tho present prosperous condition of the country, this company has not so far felt any ill-effect from tho war. New Zealand is deriving great benefit from the high prices ruling for its produce. Our exports consist in the main of primary products or Taw materials, and the high prices ruling for wool, meat, and- butter keep the monetary conditions easy. Company's Investments. "You will see by referring to the bal-ance-sheet that the deposits with accruing interest exceed those of last year by £17,028 14s. 4d., while the investments show increases on mortgages of £11,110 15s. od., on deposits with the National Bank of New Zealand of £2500, and other deposits £5775. The increase in deposits shows that the public appreciates the security afforded by depositing their savings with the company. It is difficult to see how any safor investment could be afforded than that obtained by depositing money with the company. Depositors have not only the security of carefully-chosen mortgages over freehold lands upon which all deposits are invested, but have m addition the security of £60,000 worth of freehold mortgages, representuif; the paid-up capital of ' the company, and also over £70,000 of reserve funds and undivided profits, which are also safely invested, £15,000 being deposited with the National Bank, and £10,000 in the company's freehold premises; Then, also, there is £60,QQ0 of uncalled capital. Those who do > not wish to tie up money in permanent investment on long-dated securities can have no safer security than that of a deposit receipt issued by the company.

Effect of the War. "The present war, however, must ill the near future have a very serious effect upon tiie money market, and it behoves everyone to be as careful and saving as possible. IN ew Zealand dur--111 !5 its process of development depends very largely on borrowed money, as is evidenced by the fact that each year 1 arliament sanctions the borrowing of large sums for public works, apart xroui the sums borrowed by local bodies and private persons. I'or our outside borrowing we depend upon England. When this war is over tho National Debt of Great Britain will not, it seems, less than £1,500,000,000, and 1 think Great Britain will bo fortunate if it is not very considerably moreJ The debts, too, of all European nations will bo enormously •increased. Ail countries will want to borrow money, and much will be required to repair the properties destroyed during tho war. The question'will then be: Jj rom what source will New Zeuland be a bio to borrow money, and on what terms? If tiie Government is forccd to curtail borrowing and public works, thero will be a very great stringency in the money market. The Government will no doubt continue public works as far as possible, and borrow as much money as it can locally. Wo know that in times pa-st such a course has caused a great scarcity of money for privato investment. "We must, as far as possible, prepare for contingencies, and your directors will have to exercise great care iu the future in the conduct of business. "That New Zealand has not yet suffered financially from the war is due to the splendid British .Navy to which the Overseas Dominions owe a debt that can never be repaid. So long as we can export our produce as at present, New Zealand and tho Overseas Dominions will prosper." Mr. Harold Beaucliamp, seconding tho motion, said that he could endorse all that the chairman had said about tho sound position of the company. He thought Mr. Brown liad been quite right to strike a note of warning as to the effects of tho war, but lie (Mr. Beauchamp) did not agree that this country was likely to suiter. For his part, ho believed that owing to the hign prices being obtained for our produce at Homo and the reduction of our imports, we in New Zealand expect a period of financial ease. The motion was adopted without debate. Appointment of Director. Mr. Leonard Stowe was re-elected a director, his being the only nomination. Patriotic Funds. The matter of making a further contribution to tho patriotic funds was left to the board of directors, A donation of £50 already mado was included in tho balance-sheet approved by tho mooting. Remuneration of Directors. Mr. H. Beaucliamp moved in accordance with notice given:—"That so long as the profits of the company admit of tho declaration of a dividend at the rato of 10 per cent, per annum, and provido for the transference of not less than £1000 to tho reserve fund, the directors to be paid a bouus of £150, to bo allocated as they may determine." Ho explained that this would mean an increased remuneration to every director of £10 por year. Captain Johnson moved an amendment to the effect that no such extra remuneration be paid to directors unless the shareholders received not only tho present regular dividend of 10 per cent., but also a bonus of one or two per cent, at the discretion of the directors. After debate both motion and amendment were withdrawn.