THE UNION BANK OF AUSTRALIA LIMITED.

Globe, Volume XXIII, Issue 2215, 1 April 1881, Page 3

THE UNION BANK OF AUSTRALIA LIMITED.

[Prom tho “Money Market Review” of February sth, 1881.]

A special general meeting of the shareholders was held on Monday, the 31st January, at the head office, No. 1, Bank buildings, lothbury, Robert Campbell, Esq., in the chair. The manager (Mr W. 11. Mewburu) road the report, which was as follows :—Tho directors have pleasure in presenting to the proprietors the accounts of the London office and branches as on 31st August, in accordance with tho new arrangement explained at last annual meetisg. On this occasion tho accounts include the profits in London for two months ending3lst August last, and in the colonies for eight months ending tho same date. These profits havo admitted, after ample provision for every bad and doubtful debt, of the declaration of a dividend and bonus together at tho rate of 16 per cent, per annum—viz , a dividend of £1 15s and a bonus of 5s per share for the half-jear. Tho extreme stringency of money which lately prevailed in the Australian colonies has been succeeded by a period of unprecedented financial ease. This marked change has been caused partly by very favorable pastoral and agricultural seasons, by the good price obtained for wool, and by the cessation of Government land sales; but it is also largely attributable to the transfer of some of tho sui crabvmdar.it money of Europe to the colonies, in public loans, and in remittances through various channels for investment. There is, moreover, for the time being, some abatement in that spirit of enterprise which characterises the Australian colonies. Under these circumstances, tho funds of the Bank are at present not employed there to tho customary extent, considerably less remunerative rates are current, and Banking profits are prejudicially affected. Trade, however, although dull, is sound ; and the directors confidently anticipate that after no long time new business aad industries will spring up, which will absorb the surplus money oT tho colonies. When any such revival shall take place, this Bank will be in a most favorable position to take advantage thereof. Tho directors having decided, after due consideration, to extend the Bank’s operations to the new colony of Fiji, a branch has accordingly been opened at Lovuka. The directors have again great pleasure in recording their high appreciation of the valuable services of the general marager, Mr McMullen, the chi*f officer for New Zealand, the London manager, the branch managers, and the staff generally, at homo and abroad. The annexed balance sheet presents a net amount of available profit of £135,605 9s 7d. Of this tho dividend and bonus will absorb •£120,060, and leave £15,605 9s 7d to be carried forward. The dividend warrants will be transmitted by post on 7th February, and the dividend and bonus will be payable in the colonies at snch time as the general manager shall fix after receipt of telegram. The balance sheet up to the 31st of August was as follows : Balance Sheet, 31st August, 18S0. Liabilities. Capital £1,500,000 Less—-Reserve Liability 3,000,000 Paid up £1,500,000 0 0 Reserve Funds 816,500 0 0 Circulation 315,443 0 0 Deposits £6,719,433 5 10 Bills payable and other liabilities (including Reserves held against Doubtful Debts) ... 1,128,082 12 0 Balance of undivided profits ... 135,605 9 7 £10,645,063 8 2 Assets. Specie on hand and cash balances £1,335,418 1 3 Bullion on hand and in transitu 53,536 18 3 Money at call and short notice in London 593,000 0 0 Government securities 1,042,304 11 0 Bills receivable, loans, and other securities at London office ... 1,385,760 12 7 Bills discounted, bills receivable, loans, and ether securities at the branches 5,958,473 5 1 Bank premises and property ... 276,550 0 0 £10,645,063 8 2 Statement op Phopits. Balance of undivided profit at ;30th June, 1880 £125,191 7 -4 Out of which a dividend and bonus were declared of 120,000 0 0 Leaving a balance of £5,191 7 4 Profits at the branches for eight months ending 31st August, 1880, and at the London otlioe for two months ending same date, after making provision for aU bad and doubtful debts £ 210,269 17 2 Less — Remnnerat i o n to tho local directors and salaries and allowances to the Colonial staff 56,653 14 3 General expenses in the Colonies, inclad ing rent, taxes, stationery,&o. 17,236 17 1 Remuneration to the board of directors and auditors, salaries of London office stafl.rent, taxes,stat i onery, and gencpenscs... 2,905 16 1 Income tax 3,t04 7 6 Balance of undivided profit at this date £135,605 9 7 Statement of Reserve Funds. Now Zealand Imperial Four per Cent. Debentures 200,000 0 0 Canada Imperial Four per Cent. Debentures 150,000 0 0 Colonial Government Debentures ... 150,000 0 0 £500,000 0 0 Bank promises and property 276,530 O 0 Balance of reserve funds not specifically invested 39,950 0 0 1 316,500 0 0 Total reserve funds ... ...£816,500 0 0 London, January 2jth, 1581. John S. Hill, ") R. A. Brooks, > Directors. Arthur Flower, j W. E. Mewhurn, Manager. R. Buckler, Accountant. We certify that the various securities hold in London havo been produced to us, and that we havo examined the balance books of the several branches in tho colonies for eight months ending August 31st, 1880, and the books and accounts of the Loudon office for two months ending tho same date, and, having compared the combined results with the above balance-sheet, havo found tho sumo correct. Albert Deacon? B. P. Harding j Auditors.

Tho Chairman said—Gentlemen, tho statement of accounts now submitted to yon and adverted to in the report of the directors which has jnst been read, cannot fail to be satisfactory to you : and I can emphatically corroborate tho statement regarding tho ample provision made for every bad and doubtful debt, in which provision tho committee of accounts have been far more liberal than Mr McMullen, who certainly generally errs on the side of caution. These accounts embrace, ns the chairman at tho last meeting said they would, eight months of the colonial and two months of the London accounts, which alteration, you will remember, was proposed by the auditors, in order that the accounts, both in the colonies and in London, should be brought down to an even date, with, however, the slightly disagreeable result to you of postponing the payment of the dividend by about three weeks. The profits this time include eight months’ colonial operations. This additional two months is considerably more than tho deficient four months in London, and hence we have considered it proper to carry forward a much larger sum of undivided profit, viz £15,605, as against £5191 at tho last meeting. In future, of course, the profits both in London and tho colonies ■will bo for six months only. Although tho

accounts are brought down to the 31st August last, both in London and the colonies, _ the directors have, as usual, made ample provision for doubtful debts to the latest dates by telegram. These have happily proved exceptionally small. This immunity from bad debts caused by the redundance of money in the eolonies and the great prosperity now reigning there, is of great importance, and will have a good influence upon our future dividends. Turning to the statement of accounts presented to you, the following are the salient points of difference from the previous half-year. The deposits amount to .83,719,433, being about the same as last halfyear. Bills payable and other liabilities (including reserves held against doubtful debts) amount to .81,128,082, showing a reduction of about half-a-million. Specie in hand and cash balances and bullion in hand and in transitu amount to .81,388,974, being about .8200,000 more than in the previous half-year. Now, this is the item which wo do not exactly like, bills discounted, bills receivable, loans and other securities at the branches. 85,958,473, showing a reduction of half-a-million, on account of the decreased demand for money in the colonies. There has been a small reduction in the charges both in Loudon and in the colonies, taking into consideration the eight months in the colonies and the two months in London ; and this cannot fail to bo satisfactory. (Boar, hear.) The redundance of money in the colonies alluded to in the report, must, I fear, affect our dividends, although we hope that the Lonlon profits, with the large amount of money we have on this side, will show a much bettor result than usual, on account of the tendency of money here to rise from revival of trade and other causes now beginning to operate. (Hear, hear.) The bringing of our Bank under limited liability has been successfully accomplished, and I congratulate the shareholders on this result, for our credit, like that of the groat London Banks who have adopted limited liability. has rather improved than otherwise. (Cheers.) Our acceptances are discounted in the London bill market at the finest rates, and our credits both in the East and elsewhere are held in the high-st estimation, and well they may be so, with our .82,300,000 of paid-up capital and reserves and our 83,000,000 of reserved liability. Wo have an increase of about 2 CO shareholders, the improvement in the standing of whom has continued. Notwithstanding the piesent reduction in the value of money in the colonies which our report explains, the resources of the colonies of Australia and New Zealand are so great and of so varied a character that our Bank, with its large capital and reserves, and its other great resources, must soon be wanted, and our assets are so liquid that we shall bo ready to take advantage of the great development of business and new industries which must bo brought about by the revival of colonial enterprise, fostered by the cheapness of money now ruling there. [Hear, hear ] The cheaper money now is in the colonies the sooner the change to dearer money will com" : and, knowing as I dr from long experience, that colonial enterprise, assisted by financial facilities, must soon revive, I confidently anticipate that any diminution of our future profits will not bo of long duration. The resources of the various Australian colonies and New Zealand are practically illimitable, and are only controlled by the want of population. A trade of nearly 100 millions sterling carried on by about two-and-a-half millions of people has certainly never been previously known in history. [Cherrs ] The world’s consumption, too, of our great staple, wool, keeps up with our increa'.ed production. In 1870, the quantity of wcol imported here from the Australian colonies and the Cape did not exceed 500,000 bales, and there was then a stock in first hands of about 150,000 bales. We now import more than a million of bales of wool, with the striking result that there is scarcely a bale left in first hands. [Hear, hear.] In this connection there is one consideration affecting the continuance of the prosp-rity of the Australian and New Zealand colonies which has hitherto not had the prominence given to it which it deserves ; that is, that while the world’s area of land for tropical and cereal products is unlimited, the area of land fitted for the production of merino wool is comparatively limited, and remember that from this source we derive annually not far short of twenty millions sterling. [Hear, hoar.] The development of our mineral resources is going on rapidly, and the mines of gold, copper, tin, iron, and coal, which are practically inexhaustible, are being successfully worked and are increasing year by year. The production of gold in New South Wales, Queensland, Tasmania, and New Zealand is only in its infancy, and. with the appliances of the best modem machinery, such as is employed in Victoria, must yield large results. The miners are now at Ballarat down to 1300 or 1400 feet, and the deeper they go the richer are the lodes. [Cheers ] The extension of railways into the interior of all the colonies, now being pushed rapidly forward, must add to their pastoral, agricultural, and mineral wealth. Extensive immigration has made the United States one of the greatest countries in the world, and by the same means Australia and New Zealand ought to become in time great countries. The Agricultural Commission presided over by the Duke of Richmond, recommends emigration as the panacea lor Ireland’s ills, and it certainly will attain this end far better than Coercion Bills. [Cheers.] Every adult landed in the Australian Colonies consumes British manufactures to the value of 815 to 820 annually, and it certainly will, on the solid ground of 8 s d, pay the British Government to inaugurate on a large scale the deportation of English, Irish, and Scottish emigrants yeirly to Canada and the Australasian Colonies. There is no doubt that the Australasian Colonies would liberally contribute to this great work. The Colony of New Zealand has been lately much decried here on account of its large indebtedness in proportion to population, and its bonds have consequently suffered somewhat in value. A change, however, is becoming to come over the ideas of the people hero. They begin to sea that retrenchment is the order of the day in New Zealand ; that her engagements are punctually met ; that the taxation necessary for making head against the interest of her large debt is well responded to ; and that her vast resources are rapidly developing. She is the only one of the Australian Colonies where English grasses flourish, and which, with a trifling help from turnips or lucerne in her short winter of three months, will carry four, five, and six sheep, and in Napier and other favoured spots even ten sheep to the acre, against Australia’s two acres to each sheep. Mr McMullen has lately written that he has great faith in her agricultural prospects, and thinks she will eventually outstrip the Australian colonies, and become the future Great Britain of the South. He adds “ Her climate is splendid, and her resources, pastoral, agricultural, and mineral, are all but illimitable.” This testimony from Mr McMullen in favor of this muchabused colony is the more valuable as, from his long residence in Victoria, his prepossessions ought to be in favor of Australia. I need say nothing in favor of the Australian colonies. 'I heir prosperity is so great that they require no enloginm from me. It is only on account of New Zealand’s state not being so satisfactory as that of Australia that I have confined my remarks to endeavoring to show that, although at present under a cloud, she possesses all the elements of future greatness. [Hear, hear.] The only other topic connected with the progress of colonial prosperity is the success of the two shipments of frozen moat—that by the Protos, lately arrived, after a long passage of sixty-four days, having resulted in an average sale of nearly 7d per lb. for the meat, and of about Is per lb. for 100 tons of fresh butter, the latter costing about 5d to Cd per lb. in the colony. The future of the colonial meat trade mast eventually be large, and only limited by the means of transport. By the latest Colonial statistics I see that New South Wales, Queensland, and New Zealand, alone could at present famish a surplus for export of 100,000 tons of moat, which at 2d per lb. would yield upwards of 81,500,000 sterling, and this can be indefinitely extended. But even these 100,000 tons of meat would require more than 300 ships or steamers carrying 300 tons of meat each, which is a large quantity of meat for each ship. As tor the consumption of meat in England and on the Continent, it is almost unlimited, with reduction of price, and I feel confident that good meat in England will not descend below 5d to Cd per lb., leaving thus, after paying a fr ight of 2d per lb., or about 819 per ton, an ample margin over the 2d per lb. I have indicated as its original value in the colonies. There is only one other subject I will trouble you with, after what you must consider a long and wearisome address; but it is one of the greatest interest to yon, for on this the welfare of onr Bank mainly depends ; 1 mean the conduct of our business by our Colonial and London staff of officers, who certainly deserve your and the directors’ best acknowledgments. Mr McMullen, Mr Palmer, and Mr Mowhnrn have only the Bank’s interests at heart, and their efforts for the good of the Bank have been most unwearied and single-minded, amid the stirring and eventful changes of the last two years, during which they have had great and grave responsibilities cast upon them. [Cheers ] Their efforts have been well and ably seconded by the other superior officers and by the staff generally. Wo have much to thank them for. [• beers.] If there is any further information you wish for I shall be happy to afford it, meanwhile I beg to move the adoption of the report and accounts.

Mr W. Botly, in seconding the motion, congratulated the meeting on the result of the adoption of limited liability, and on the wide outlet afforded by the Australian colonies and New Zealand for tto redundant population of Great Britain and Ireland. The motion was then adopted without any previous discussion, and a dividend of -£l 15s per share, with the addition of 5s per share bonus, making together 1G per cent, per annum declared.

On the motion of Mr John Balfour, seconded by Major Plomer, thanks were voted to, the directors and the officers of the Bank, in the colonies and at home, which wore duly acknowledged. The meeting then separated.