THE BANK OF NEW ZEALAND.

Evening Star, Issue 3965, 9 November 1875, Page 2

THE BANK OF NEW ZEALAND.

We make the following extracts from the sp-eoti o: ih cluiiiman (»ir C J. t>toue) mi the occasion of the J3 nk's annual meeting . t Auckland la-t month : - It must be a matter of congratulation to shareholders to witness how well the business of the bunk is maintained. It is now rourtecu .years (since its first establishment, aud a hasty retrospect of its progress may not be considered inappropriate. The circumstances which led to the formation of the bank will be in the reoolleetion of many now present—the insufficiency of accommodation afforded by the establishment which then occupied the chief position among the banks in the Co ouy, the retirement of the Oriental Bank, aud the advent of the Bank of New South Wales. A few of our more enterprising and far-seeing citizens resolved that the time had arrived when the Colony could well support a bank of its own, aud that there was no reason for New Zealand any louder remitting yearly large dividends for the enrichment of foreign shareholders. The result you all know, and no higher compliment can be paid to the judg ''cut and foresight of the promo'crs of the New Zealand. Since its commencement dividends have been paid to sharehold rs, amounting in the aggregate to L920,uT0, a reserve fund of LIBO,OOO lias been formed, unci a very largo amount, about LIOO.OOO, has been written off bank premises aud furniture accounts. But apart from the fact that the whole of this large accumulation of profit has been saved to the Colony, we may well take pride in the often acknowledged service the bank has rendered to the coniinercuil and general interests of the people of New Zealand, aud in the evidence of their confidence in the institution as evinced in the figures put before you today. The balance-sheet shows the deposits and circulation amount to L 6,180,000, and though it is right for me to mention flat about a million and a-half of these resources is due to U e deposit of the reni:iiuining portion of the four million loan, the balance is yet of such magu tude as to afford gratifying evideuco of the support and confidence of the public. On the other side it will be seen that the bauk's advances keep pace with its resources, as we are resolved to attempt at least to meet every legitimate requirement of our customers. The demands on the bank for accommodation during the past twelve mouths, consequent on the rapid growth of the business of the Colony and the apparent indisposition on the part of foreign banks to enlarge their advances, have been very great, and it has for some time been apparent to the directors that, without taking a very sanguine view of the future, a return as favor- I able as is proposed to-day could be paid by the bank on a considerably increased capital. The directors have, therefore, determined to avail themselves of the power eommittet to them by you at the special general meeting held en the :29th July, 1870, to make a further issue ot 10,W0 shares, which will be lirst oifcred to present proprietors at a premium of L 5, being L 3 below the present Colonial value of the shares, aud L 7 below the price iu Loudon; and, as the directors entertain not the least doubt of maintaining the dividend on the increased capital, the difference between the price of issue aud the present market price may be regarded as a bonuß to present shareholders. At an «arlj date a circular will be addressed to each

sharohftiaer on the entjoot 5 but I may m\\ urthor say, at present, that payment fo lie new shares will not ho required till the fir.. >f Jauuary, from which date the new shan will participate in the profits of the half year, anueantime any shareholder electing to pnv it. .- ance will, till Ist January, l>o entitled to interes 't. The rite of G per cent, per annum It wi ii< the recollection of shareholders that the resolution o which 1 have referred empowered the diroctoi o make au issue of teu thousand shares in any on rear till the capital reached a niilliou. Five vein.lave now elapsed since the first issue under these •os\lutiou was made, which uiav he aeon cl asevidence of the directors' determination not to as! 'or additional capita* until fairly satisfied not onh that it isrequiredto maintain the leading position of th" bank, hut also that the calling up such capital will not interfere with the ord nary dividend. Under the existing regulations as to the amount ot the reserve fund, only L15,0000f the L. f >o,oiK) to be obtained as premium on the new shares would be available as an increase to our present reserve ; but I may state thai it is the intention of the diroctois before the nest half-yearly meeting to call a special general meeting t • effect an alteration of this clause of the bank's deed of settlement to admit of the reserve fund acquiring largei proportions. . . . So much jealousy and bad reeling have been excite 1 by our possession of the Government account, and so much misapprehension as to its actual benefit, that, should the Government adopt the course suggested by the Public Accounts Committee of calling for tenders for the account, we will not feel aggrieved. No doubt, if the acco.mt were to remain as at present, or as it has boon during the p-'St six months, there would be good reason to make it au object of desire ; but the condition to which I have referred is far fr m being the normal condition of that account; and it may w. 11 he apprehended whether it will long remain in such a state as to make it so much an object of envy as it has been of late. At a moderate estimate, at least fifty of our clerks are employed solely on the Go-ve-nmont business, besides the cost of numerous agencies, which would not, have been opened hut for the bank's desire to offer ready facility for the transaction of the business of the Government. The opportunity, however, is now afforded for one of our competitors st< ppiug into the breach, aud if they are able tc offer equal facilities with ourselves at 1 better price, then by all means let them have the account. The balance has usually been so nicely adjusted that, as a rule, a very slight inci ease on our present terms would turn profit into loss ; and, though we attach some weight to tho prestige of being bankers for the Government, we are not disposed to suffer a loss by it Lot me only remark, in conclusion, as to the that while there is much to encourage, there is also much to iucite great caution; aud your directors are resolved that while maintaining the premier position of the bank in the Colony, they will not lend themselves to any undue stretch of credit, or toauv busiuess of a purely speculative character. Their efforts wdl be devoted to the development of healthy enterprise, and to the legitimate snpp >rt of the rapidly-growing interests of the Colony of New Zealand.