WELLINGTON NEWS

Hokitika Guardian, 12 June 1930, Page 5

WELLINGTON NEWS

BANK OF NEW ZEALAND.

(Special Correspondent.)

WELLINGTON, June 10. The balance sheet of the Bank of New Zealand for the vear ended Ma rch 31, was circulated at the week end and the document clearly shows the strength and stability of this leading bank of the Dominion, and the figures show the excellent service rendered by the Bank to the Dominion during the twelve months. The net profit for the year at £948,534 is £ Jo. 580 more than the net profit for 1929, ibut available surplus amounts to £1,566.125 against £1.707.484, a decrease of £141,359.

The dividend for the year on all classes of shares is the same as that of last year .so far as the Government A and B shares and the ordinary shares are concerned. There is now the Long Term Department, and the dividend on the C and D long term shares for the year amounts to £48,698. On the A and B preference shares held by the Government the dividend at '£231,250 is the same as last year rind the ordinary shares also receive the same as last year, a total of £537,500. There is added to the reserve fund £275,030 as compared with £124,175 last-year, and the carry forward 'is £617.592 as 'against £582,525. The reserve filnd now stands at £3,425,000 as compared with £3,150,000. The liabilities aud assets reflect the economic conditions of the Dominion. Thus the note circulation at £3,754,948 shows a contraction of £535,945, and that is because the people are carrying less pocket money. Denosits total £33.897,609 as compared with £33,939,651, so that there is very little difference. Although deposits are practically the same as they were a year ago there is a big increase in advances, which are shown in the balance sheet at £27,415,639 as compared with £21,505,380, an increase of £5,910,259. This is a very substantial increase and shows that the Bank of New Zealand has treated its customers generously.

The discounts are also larger the figures being £1,693,950 against £l,330,073, an increase of £357,8477. The London funds of the Bank have contracted very much the figures being £0,743,499 against £12,459,18, the decrease being £5.715,719. This in some measure accounts for the high exchange rates and some of the other London banks must have their funds very much depleted. The Bank of New Zealand is a veritable asset, to the Dominion and its strength and huge ■ resources are an assurance that when times .are stringent the country can rely on the' fullest support that, the Bank can give. The country is well served with banks, all of which are strong ahd excellently managed, and this raises the question whether we need more banking facilities in the Dominion, Two or three years after the‘disastrous slump of 1920-21 when New Zealand was suffering a recovery, the banks were harshly criticised for hot lending to all and sundry on any kind of security, and some astute compay promoters seized the opportunity of suggesting the formation of new banking concerns. The tesult was that three new banks were - mooted and two issued prospectuses. The Mercantile Bank of Australasia is believed to have had some capita] subscribed, but it has gone out of existence, indeed it would be more correct to say that it was still-born. The Australian and New Zealand Bank is still seeking capital although it was previously announced that the minimum subscription had been secured and the concern would go to allotment. It is allegedl that this concern has secured most if not the whole of its capital in New Zealand, which has been transferred to Australia, where operations will begin if they start at all. There were two directors in New Zealand, l>ut riiinour has it that these two are not now on the Board. 7

The third hank proposed, the London and New Zealand Bank, germinated in the Dominion, in fact' in the Hawke’s Bay district, and it must be admitted that the promoters of this Bank ' proceeded in an orderly and open manner. They applied to Parliament for a charter and for the right of note issue, and after an exhaustive inquiry into the proposal by a Parliamentary Committee, the charter was granted and a time limit was fixed for the formation of the Bank. The time expires on July 81, but it is understood that the promoters intend to ask for an extension of time, on the ground mainly that owing to the stringent money conditions caused by the New Aork Stock Exchange gamble and collapse it has been impossible to raise the London quota of the capital. It was intended to raise £1.00(1,.0DD in London and a similar amount' in the Dominion, ft is believed that the promoters will he granted a reasonable extension of time. ""