Suspension of the N.Z. Loan and M.A. Company.

Manawatu Herald, 13 July 1893, Page 2

Suspension of the N.Z. Loan and M.A. Company.

■ # m Cablegrams from London of July 10th announce that owing to the bank crisis in Australia, the New Zealand Loan and Mercantile. Agency Company (Limited) has - suspended payment pending'reconstruction. It has been known for a fortnight^ that the New Zealand ■< Loan, and Mercantile Agency Company vifai' embarrassed by the bank failures in . Australia. The directors met daily, and were hopeful of surmounting their difficulties until yesterday, when they found that they would .te unable to carry through ''pertain financial arrangements ; ;mth':Australian banks. • 4;?,':^_l&£& The directors state that* sclieme for reformation will shortly he devised, lt . would be foolish to wind-up so profitable a- eoiicera, especially as only half a million is needed to carry on. Thi? atnjount will probably be obtained "by a call or by the issuing of preferential shares. J y-y-}4 A large sum has been looted -up in sheep walks, though not much has been invested in this direction latterly. Owing to the bank crisis, facilities for financing were cut off, and the company was unable to rapidly realise its securities. It has also found it impossible to ' discount London acceptances on tbe suspended banks. **■•.' / ; <i From Mr Battley, general manager of the Loan and Mercantile Company in New Zealand, the New Zealand Herald has received thf foJUp-js^ng. information : — The susj^nslori^ ia; absolutely due to the recent and still existing banking crisis in the Australian colonies, and not to anything conneoted ivith the business of the company. The company have, in common with other financial institu-. : tions, all alon* held considerable , deposits in Melbourne and Sydney, and, as a matter of cour&e," these have recently been largely with-J^ drawn. Confidence in every institution has been shaken, and t|ie ing up of large sums, by the 'suspension of the bank-}, haa m many oases compelled people to withdraw deposits whenever they oould. The suspension of so many banks has also very much cramped ordinary financial recourses for eenductinj

commerce, and disorganised facilities for exchange with England. The ' recent suspension of Messrs Golds • . brough, Mort and Co., who carried on the same kind of bnsiness as this company, has also very greatly aggravated matters, and contributad j materially to the causes which have y brought about the suspension of the Loan and Mercantile Agency Company. There is no difficulty in regard to the debentures ; they have not- affeoted the position at all, or only slightly. Nothing has occurred in New Zealand to in any way contribute to tho suspension. Tire business here bas been conducted on safe, prudent and conservative lines. The company holds deposits in New Zealand, bufc there have been no withdrawals beyond merely the usual amount. There will be as little interruption of business a.s possible. The formalities necessary to reconstruction will have to be gone through, but bnsiness will be resumed as usual at any early date. Every effort will be made to avoid inconvenience to the company's customers, and to maintain the very valuable business which has been built up. . The ; balance-sheet issued by the company in January la3fc showed the' company to be in a good position. That position has been maintained since, but the suspension has been rendered necessary by the withdrawal of deposits, as above stated, consequent on the financial panic which has recently prevailed in Australia.