THE BANK OF NEW ZEALAND.

Greymouth Evening Star, Volume XXXI, 11 July 1901, Page 3

THE BANK OF NEW ZEALAND.

Seddon's Speech in the House. (Oub Parliamentary Rbpo eteb). Wellington This Day. " The Premier's motion that the balance sheet of the Bank of New Zealand which was laid on the table on Tuesday should be printed led to an unlocked for debate. Mr Seddon called attentfon to tho fact that it had been stated in the public Press that the bank was going to pay a dividend. He could point out that very little had been paid off by the Bank in respect of the Assets Realisation Board and he himself thought it would be better if those entrusted with the affairs of the bank first of all paid off their debt instead of paying dividends. The responsibility of Crown still, remained intact in respect 3 of the Assets Board. He thought he shou d speak plainly so that there would be no mistake afterwards. If they did not say anything it would be taken that Government tacitly agreed with what was being done, at the same time he might say that no one was better pleased than himself at | success of the bank.

Piiani expressad surprise at the new dictum of the Premier, and that it was necessary to pay off debts defore declaring deminds or going in for another expenditure. If that principle applied to the Colony what would happen to the proposal to establish a line of steamers to carry the Colony's produce to outside markets. It was proposed to spend four millions in this direction, and yet the colony was not asked to pay off its debt first. Surely they could not ask the bank to conduct its business on different lines to those of the Colonial Government. He considered it an improper thing to ask the House to criticise the bank on; hearsay evidence. He did not think tho directors would dream of paying dividends under the present ciroumstances. as; it was proposed. It was probable that' within two years they would have to come to the House for a renewal of the large; guarantee. > Jas. Allen regarded the Premiers; statement as very damaging to the bank. It was provided in the Banking Act of 1895, that the bank could pay a dividend in due course, but he took the Premier's remarks to imply a threat to repeal these clauses (Seddon:—No. !). He considered the Premier's statement would do a great deal of harm to the bank and dishearten shareholders and those who were administering the bank's afiairs. Seddon in replying, admitted that the Bank could pay dividends in due course, but he thought it was better that they should not do so. If directors paid a dividend in the present circumstances of the bank, they would be liable under the existing commercial law. The Chairman sometime ago made up a statement that the bank might be able to pay a dividend, but he subsequently withdrew it as he found it bad led to some misapprehension. He (Seddon) could tell the House there was no intention to amend

or repeal any of the provisions of the Banking Act, and there was nothing behind the statement he had made. It was quite clear that in two years or so legislature would have to be renewed, or extend the time in respect to the colony's guarantee.

The Assets Eealisation Board still remained, as a very little had been paid off. He went on to say he did not think the bank would cost the Colony a penny piece, notwithstanding the great obligation it owed to the Colony. Thi action of the Legislative had! saved millions of money, and averted a financial disaster. In face of the fact that the baDk thought it better for him to stand up manfully and stato the true position of affairs. Payment of dividends by the bank was not mandatory, and the statement that had obtained circulation might lead to expectaticns that might not be realised It had already led to speculation, and it was better to do as he had done than allow the statement to go unchecked. He complimented the bank and its officers on the buccess of the business, and said the appointment of Mackintosh as Government Auditor was one of the best things

that ever happened to the bank and colony. Never since its inception was tho bank of New Zealand in a better position than at the present time.