The Guardian And Evening Star, with wince, is incorporated the west Coast Times. SATURDAY, JUNE 19, 1926. A SATISFACTORY POSITION.

Hokitika Guardian, 19 June 1926, Page 2

The Guardian And Evening Star, with wince, is incorporated the west Coast Times. SATURDAY, JUNE 19, 1926. A SATISFACTORY POSITION.

I Tub particulars published yesterday 'of the balance sheet and annual meeting of the Bank of New Zealand gave an interesting insight into the alfairs of the institution. The vision was altogether satisfyng as regards the stability of the Bank, and the state of affairs, confirms once again the wisdom of the Liberal Government ill years gone hy backing the* Bank with the public security to see it through troublesome times. As an outcome of that timely and very friendly help the Government representing the country became interested shareholders ill the Bank and had special representation on the management. It was good business, saving the credit of the Bank in the first instance, and afterwards adding steadily to the credit of the country hy a sound investment well managed and well directed. 'I he success of the Bank is to he applauded and appreciated, for it has weathered a very difficult state of affairs, anil in doing so came through with living colours, and is now a real asset in the material welfare of the Dominion. The State being so much involved in the financial fortunes of the institution, it is hut natural that its business and policy should lie canvassed closely. 'l'he statement of the Bank’s allairs by the Chairman, and his review of the (inaneal position generally, are very illuminating. The Bank has earned a large profit on the year’s turn over. The gross profit runs to £1.888.309, a sum which will suggest in the minds of some a surplus far too large. But the Bank is dealing with assets of a large value, and it is only hy sound management that such a return can he achieved. There will lie those who consider that being something of a third of a State hank as regards its capital invested, it should he run on lines to produce a reduced profit. But credit is not something to he given awav for nothing, and no financial institution could hope to maintain a satisfactory balance unless there was confidence in its management and satisfaction that the money on which the huge turn over was possible, was in “safe” hands. A Bank lias other resources for income than the immediate capital invested in the concern, and the careful handling of other peoples’ money entrusted to it in various ways of deposit and exchange are a special, and naturally a very profitable source of income. It is in sound judgment with regard to the use of such money, whether hy accommodation or oil loan, that a large proportion of the profits are made. The State receives a substantial sum by way of preferential dividend rn shares held. The State dividend totals £212,464, while the amount payable to the shareholders is £499.928. It will he seen that the State is doing well out of a partnership forced on the country originally, but the benefits of the alliance as between State and Bank have been mutual. The balance sheet discloses the financial strength of the Bank hy reason for its reserve. The liquid assets alone are very large. Indeed, the position is altogether very satisfactory, and emphasises the value of its management. That after all is the mainspring of the success and the capacity of the institution to carry on profitable business. The stability of the Bank of New Zealand is a great

asset to the Dominion at large, and,its financial .standing must be a marked factor in maintaining the credit of the country at Home. The Chairman of the Bank referred in his speech to the general outlook. For years past the chairmen of the Bank have viewed the position and gauged the prospects very accurately, and the country call afford to take note of the advice tendered at the present juncture. The Bank's proposal regarding long dated loans is a new departure intended primarily for the benefit of those on the land. It is a proposal hearing on a system of rural credits, and i pears to he in anticipation of any Rural Bank proposals, the committee now abroad might bring down on their return. The details are still to be given out, hut it appears the Bank proposes to launch out in another lending direction which will be of special help to those on the land, and should he of marked help to land settlement.