The Financial Crisis

Feilding Star, Volume XV, Issue 10, 12 July 1893, Page 2

The Financial Crisis

SUSPENSION OF THK N.Z.L. & M. COMPANY. I.FBR PEKBS ASSOCIATION.] London, July 11, It has been known for a fortnight that the New Zealand Loan and Mercantile Agency Company was embarrassed by tbe bank failures in Australia. Tbe directors met daily, and were hopeful of surmounting their difficulties until yesterdajr, when they found that they would be unable to carry through certain financial arrangements with Australian banks. The directors state that a scheme for reformation will shortly be devised. It would bo foolish to wind up so profitable a concern, especially as only half a million is needed to carry on. This amount will probably be obtained by a call or by the issuing of preferential shares. A large Bum has been locked up in sheep walks, though not much has been invested in this direction latterly. Owing to the bank crisis, facilities for financing were cut off, and the company was unable to rapidly realise its securities. It has also found it impossible to discount London acceptances on the suspended banks. The Now Zealand Loan and Mercantile Agency Company is applying to tbe Court for a protection order. The Napier Harbour Board debentures fell £2 owing to the failure of the New Zealand Loan and Mercantile Company. Wellington, July 11. Mr W. G. Foster, manager of the Wellington branch of the New Zealand Loan and Mercantile Agency, says that he knew nothing about the affair, that he had received no word about it from the New Zealand headquarters at Auckland, and bad had no idea that anything of the sort was likely to happen. There was no need for anxiety, as clients' interests were protected, and were absolutely safe. Auckland, July 11. From Mr Battley, general manager of tho Loan and Mercantile Company in New Zealand, the New Zealand Herald has received the following information : — The suspension is absolutely due to the recent and still existing banking crisis in the Australian colonies, and not to any. thing connected with the business of the company. The company have, iv common with other financial institutions, all along held considerable deposits in Mel. bourne and Sydney, and, as a matter of course, these have recently been largely withdrawn. The recent suspension of Messrs Goldsbrough, Mort and Co., who carried on the same kind of business as this company, has also very greatly aggravated matters, and contributed materially to the causes which have brought about the suspension of the Loan and Mercantile Agency Company* Chbistchuhch, July 11. The news of tho suspension of the New Zealand Loan and Mercantile Agency Company has been the all-absorbing topic this afternoon. The opinion generally held is that the position is in no way due to the New Zealand business.