The Banking Enquiry.

Feilding Star, Volume XVIII, Issue 36, 11 August 1896, Page 2

The Banking Enquiry.

(Per Press Association) Wellington, August 10. Continuing his examination, Mr Booth said the agreement tor purchase of the Colonial Bank only indemnified the Bank of New Zealand "to the extent of the "C'list. In respect of "B" list the Bank of New Zealand took cover for v.hat it thought sufficient, vix., £272,100 The writing off undertaken in connection with the agreement was no donbt carried out. Mr Hutchison : Did the Bank of New Zealand, on this contract taking effect, ■write off the amount which appeared in the right hand column of the C list from the amount known to exist ? Mr Booth : The Bank of New Zealand bad no right to write off. I wish to say to say that, whatever may be the working of that clause, wo, having these C list accounts guaranteed, are not interested iv what is done with them Mr Cooper hero objected, on behalf of his client, to this matter being pressed further. Examination continued : The Bank understood that £55,283 in the C list was not wriUon off, but credited to the amount of .£98,382 in the list. This amount was guaranteed by the Colonial Bank. The Bank of New Zealand had never taken over any account m the C list. They had three months in which to decide whether they would take over i any of the C list accounts. One day before the determination of the three months the Bank decided not to take over any of the C list accounts. In coming to a decision as to amalgamation, the Directors of the Bank of New Zealand had the assistance of the Inspectors of the Colonial Bank, but they relied on the examination of the accounts made by their own oflicers. It was necessary to ask for any information as to accounts in the C list. Witness knew from the books that the accounts in the C list the sums of ±2.000 and £5,000 had no connection with the C list or with any of the other lists. Mr Hutchison : Has this sum of £2000 any reference to a parcel of debentures ? Mr Seddon rose to a point of order and urged the committee mast keep within its order of reference. There must be evidence ot writings off before these particulars could be gone into. A similar question was ruled irrelevant on Saturday. Messrs Hutchison, Montgomery, and Maslin urged the question sbould be allowed, as it had reference to the purchase of the Colonial Bank and amount paid for goodwill. Mr McKenzie submitted that as there bad been no writings off in connection with this question, the committee could not enquire into it, otherwise they would be entitled to enquire into the accounts of the Bank whether there had been writings off or not. After considerable argument the chairman ruled the question irrelevant at the present time. Witness, coofcinuing, said the Directors of the Bank of New Zealand expected to lose £30,000 or £35,000 on Colonial Bank properties and premises. Mr Hutchison asked several questions | with reference to the £25,000 advance, I but Mr Booth declined to answer most of them as they would involve disclosnre of private accounts. He could not say whether the Directors were responsible for the advance, as an answer to the question would traverse the Chairman's ruling on Saturday. In fact he must decline to answer the question on the ground that it would involve disclosures of private accounts. The Chairman asked the direction of the Committee as to what documents should be printed of those produced by witnesses. On the question of the printing the return of the profit and loss accounts at twenty-three stations of the Bank of New Zealand Mr Montgomery objected on the ground that the publication would be prejudcial to the interests of the Bank. The Premier contended on broad grounds that the public were entitled to the information and moved that the documents be printed. As a member of the Realisation Board he wanted the people the know the position when the present Board took office. The Committee resolved that the documents be printed with several others. On the question of Mr Booth' 3 refusal to answer questions asked at the morning sitting Mr Hutchison moved, " That there being evidence now before the Committee that under agreement of the 18th October, 1895, between the Colonial Bank and the Bank of New Zealand, that the last named or purchasing Bank has complied with so much of Clause 18 as provides, that the purchasing Bank shall immediately on this contract taking effect write oft amounts standing in the right hand column of the " C " list, and credit the respective accounts in such list with the amounts so written off," this Committee called on Mr W. Booth, a witness now under examination, to produce certificate copy of snch "C" list. The Premier objected that notice of motion must be given. It was resolved that notice of motion be given. Mr Hutchison moved that consideration of Mr Booth's refusal to answer certain questions be deferred. The Premier seconded the motion. Mr Montgomery, in supporting the motion, said the questions which Mr Booth declined to answer would have to be replied to by someone. The motion was agreed to and the Committee proceeded to discuss the motion by Mr Guinness to exclude the press from its meetings. The Chairman ruled that as the Committee has passed a resolution at a former meeting that Mr Booth's evidence be completed before dealing with the notice of motion, Mr Guinness' motion was not in order. The Committee then adjourned. This Day. The Banking Committee resumed this morning. In reply to Mr Hutchison, Mr Booth repeated his opinion that provision should be made so that the directors of the Bank of New Zealand should have power to call on the auditor to report to the Colonial Treasurer for the time being vrhen they considered any irregularities existed. This was not mere theory* 1 on his part, but a suggestion found on experience The advance of £20,000 was perfectly safe, and he believed it still existed in the Bank guaranteed account. The "C " list did not effect the Bank of New Zealand now or any customer of it. The Bank was quite of it. Mr Hutchison asked witness whether he had any abjection to produce a certified copy of the " C " list. Witness replied that he could not produce the list for the reason that al though " C " list was not taken into the Bank, the names in the list were the names of customers of the Bank holding confidential accounts in that institution. Mr Hutchison asked witness several questions with regard to the estate of Jno. Ryley, of Dnnedm, but witness do chned to give any information on the subject, and also refused to say in which list railway*! account was contained. Mr Butchimn pressed a question re yarding the investigation by the Bnnk into the affairs of the J. G. Ward Association. Mr Seddon said as no writings off had been proved in connection with this Association the question was out of order. Mr Maslin pointed out that the Committee were debarred by the- Premier's contention from aecertainidg whether there were ttfjy writings off or not, how,

under th«se circumstances, conld thfl enquiry proceed. Considerable discussion followed, some of the members contending the agreement itself proyed the writings off id con I nection with the Ward-Association. Tbe contention was strongly combated by the Premier and other member. The Chairman said he moat rule that, for the present, the question was premature and irrelevant. Mr Booth bad j stated, definitely and distinctly there were no writings off in connection with the " C " list. Mr Hutchison asked witness whether the Ward Association, now in liquidation, was indebted to the Bank of New Zealand. Mr Seddon rose to a point of order, and the Chairman again ruled the Committee had no right to enquire into the private accounts of persons and companies unless there has been writings off in connection with them. Mr Hutchison : Was there any writing off from John Ryley's account ? Mr Booth : I do not want to depart from my refusal to answer these questions, but I may say in this particular case there was no writing off. Mr Hutchison : Then do yoa say there was no writing off in connection with the Ward Association ? Mr Booth : I decline to answer that question.