MR. ELL AND A STATE BANK.

Gisborne Times, Volume XXV, Issue 2165, 22 August 1907, Page 2

MR. ELL AND A STATE BANK.

PROPOSED ACQUISITION OF THE BANK OF NEAV ZEALAND. ABSURDITY OF THE PROPOSALS. PLAIN TALK BY THE PREMIER, (Special to Timos.) AYEULdiNGIuts, August 21. The oilier day Mr. EH put the following questions to tho Premier: — Whotlior tlie Government do not consider taut the State, which came to tno rescue ol tho Bank of New Zealand in tho time ol financial troubles and by so doing saved the bank from ruin and has since given the bank a monopoly ol public business and thereby giving tlie greut advantage of being in a position to publish the tact that tho bank is tho banker to tho Government of New Zealand, is entitled as a shareholder to share equally with tho private shareholders with respect to dividend? Tlie Promier Teplied that the terms and conditions wero fixed by Statute and to attempt to alter them would bo a breach of agreement. Mr. Ell said in reference to the last answer that apparently something was being kept back. He had never heard of any agreement upon which the Statute law was passed. He thought tho present position was monstrous. Tlie Premier in reply to Mr. Ell, denied absolutely that anything .was being kept back. In proof lie cited the Statute of 1903, winch he said made th(J position clear, lho position could only be altered by legislation. As to himself, he had never had ..ny interest, directly or indirectly, in tho bank. Ho hail been offered shaies, some for nothing. At other times he had been offered shares at 2s bd, Is, 10s 6d and 15s, but lie hail always declined to touch them, so lie was able to speak with complete freedom in the matter. Ho proceeded to refer to the pressure that was being brought to bear to establish a State Bank. Ho had been receiving numerous requests. Mr. Massey: They all originate in Christchurch. They are all printed in tho same way. . . , The Premier , said he was in leceipt of resolutions from all over the colony asking tho Government to take over the Bank, but as the Bank had liabilities amounting to £18,395,000 that would be an absurd thing for the Government to do. He was being asked by large numbers of the most innocent manner to assume tlie enormous responsibility that would he incurred by taking over these liabilities. Supposing the Government were foolish enough to do so. what would follow? The shareholders controlled tlie whole of the deposits, some thirteen millions sterling, and tlie bills under discount it the Government said they would take over the institution it was not likely that tho shareholders would be so stupid as to let the colony collar their deposits and other business. I hey would say: You may take over our liabilities to a limited extent, but we will carry on our own deposits in the ordinary way; "and,” added the I romier, “you could not stop them. It was tlie old question: That which might seem theoretically sound and all right was in reality impossible. Anyone who examined tho position would find that it was next door to impossible for the colony to do what Mr. Ell wanted it to do. The responsibility of taking over £18,000,000 of liabilities was enormous, and he objected to the way in which resolutions were coming in from people all over the colony who evidently knew nothing about it. They might as well say the Government should transfer New Zealand to the centre of America. Ho had received these resolutions by the score. Mr. Barclay: Tlie Bank has assets. Tho Premier: They can take their assets away. AVo cannot control them.

Mr. Ell: AA’c have a share in them,

The Premier: The shareholders have rights, too, and we cannot do anything that is unfair or that would be a wrong thing to do. Mr. Ell said something about a banking risk and high rates of interest.

Tho Premier said if the rates were unduly high people could go outside tlie Bank.

PUBLIC REPRESENTATIVES ON THE DIRECTORATE.

ARE THEY BIG SHAREHOLDERS? AVELLINGTON, August 21. Mr. Ell asked the Premier whether it is a fact, as stated, that some of tlie directors representing tlie interests of tlie public on the Board of Directors of the Bank of New Zealand are large private shareholders in tlie said bank ?

The Premier said : Inquiries will be made, and if it is. found to be so the Government will consider what steps to take.