WELLINGTON NEWS

Hokitika Guardian, 10 June 1927, Page 1

WELLINGTON NEWS

BANK OF NEW ZEALAND

(Special to “ Guardian.”)

WELLINGTON, June 8. \ cry often the Bank of New Zealand is subjected to severe criticism hy people who possess a hazy notion of the functions of a hank. Because the State holds shares in the Bank, it is therefore presumed that it should undertake all sorts of risky ventures, hut in spite of all this we think, at heart, the people are very proud of the Bank ot New Zealand because of its sound solid strength. The balancesheet of this bank lor the year ended March 31st last has been issued and the figuies in detail and in the aggregate disclose a sound position, and this is as it should be, for the Bank of New Zealand is intimately associated with the commercial, industrial and farming interests of the country. It is in a very safe, sound and strong position. The net profit for the year under review is {.‘847,671 and this is £64,480 less than the profit shown in the balance-sheet of last year, when the amount was £912,160, but compared with 1926, when the net profit was £819.286, there is an increase of £28.386. The profit-earning capacity ol the Bank is well maintained, and this indicates careful and prudent management and a strict adherence to sound banking methods. To the net profits of £847,671 must be added a windfall ol £143,-120, being the surplus on realisation and on maturity of Government and other securities. In last year’s balance-sheet there was a windlull of £IOO,OOO, this being part of the provision made for anticipated loss which did not materialise. In addition to the special credit of £143,420, there was brought forward £666,378, so that there was available for allocation or distribution £1,556,469, which contrasts with £1.525,460 shown in the 1926 balance-sheet. The amount distributed amongst shareholders is £771,814. The preference A shares held by the State receive £50.000 or 10 per cent, on the preference B shares the dividend is £102,500, and the bonus £18,750, or a total of £181,250 which also goes to the State; on C long term mortgage shares the dividend at 6 per cent per annum absorbs £.379, and tbe D long term mortgage shares held hy the public the dividend is 7] per cent and the amount of the dividend £2,185. The dividend on the ordinary shares is 2s 8d a share with a bonus of I per cent absorbing £337,500. The State’s dividends total £232,169. The paid-up capital of the hank, which includes guarantee stock of £529,988 10s Od. stands at £6,520,185 as against £0,151,988, the increase being clue to the issue of C and D long term mort- < gage shares, the amount paid up on these shares being £374,197. Although the long term mortgage branch was in operation for a limited period up to .March 31st last yet the loans made were for a total of £97.900. An addition of £200,000 is made to the reserve fund out of profits, making that fund £3.025,000. and a balance of £584,055 is carried forward. WOOL TRADE COMPETITIONS.

Writing on the outlook in their wool circular of May, Messrs H. Dawson and Co., the well-known woo]brokers, state that Bradford has had a quiet period following the activity in raw material and semi-manufactures, deliveries of contracts then placed are not being pressed for. Turnover therefore is not as large as generally expected and there is a tendency to make cheap offers both of tops and yarns in an effort to stimulate business. The industry is gripped with pernicious malarial symptoms which require drastic treatment and combined efforts Co find a remedy. It would be disastrous to allow plants to lie broken up, resulting in destruction ol valuable or-

ganisations. An amalgamated movement that would bring about, a reduction in antiquated machinery and buildings would be welcomed as n source of relief. Methods of production of this country in textiles have not shown any substantia! progress for at least a quarter of a century. Stimulation of demand by expansion of outlets is far better than ruinous competition which results in continuous losses to every section of the trade. While cheap wool is a. great factor retailors alone appear to profit by weakening values. Continental centres have not suffered so consistently although each consuming country has its own peculiar difficulty. Germany has been remarkably active and busy. French and Bradford importers have recognised and catered for the demand, hut there are- signs of slight diminution. Italy is going through purgative currency appreciation which has undoubtedly assisted German trade in the Near Fast. The United States prospects arc beginning to brighten after an unparalleled period of trouble. Mills have been and are working on an average of 6ft per cent capacity; overhead expenses have not. been . earned. Consumption for the first quarter exceeds that of the same period last year.