BANK OF NEW ZEALAND.

Nelson Evening Mail, Volume XIII, Issue 105, 3 May 1878, Page 4

BANK OF NEW ZEALAND.

The Chairman, in moving the rs&olution for the adoption of the Report, •said : Gentlemen, It has been the good fortune of the occupant of this chuir-^— I may almost say from the first meeting of the bank — to have only congratulatory remarks to make to shareholders, and the. present occasion proves no exception to the rule. The report which fc»'d just been read, will, I am sure, com mend itself to you as evidence of the bank's continued prosperity, and favorn<ble as that report ie, it would have been materially better but for special causes; the principal one being the continued depression on the West Coast of the Middle Island, which has entailed considerable loss on the bank, but whtcb, I fla». happy to assure you, bas been amply provided for out of current "profits. A case of default has also contributed, to swell lossep, but this likewise has been fully provided for, and \l is a pleasure to assure shareholders that such cases in our experience are extremely me* — in fact are co exceptional as to reflect the highest credit on the character of the bank's large stuff. Another heavy tehfcrge upon profits has been th« necessity of extending the bank's agencies in directions which do not, become immediately remunerative. I feel assured, however, tbat shareholders will heartily endorse the action of the board in this matter, the aim of the directors being to m»ke this institution the Bank of New Zealand in reality as well as in name, No opportunity therefore is lost which, either from present appearanceß or future prospects, offers a fhiir chance of success to extend to outlying districts the benefit of bankiDg facilities. Your directors consider they best coneerve the general interests of proprie. tors by pursuing this policy, thus enlisting the sympathies of the general public, even though at a sacrifice of immediate profits, which are not the sole aim of this institution. We are represented at no less thun eighty-four localities in New Zealand alone, and shareholders who have had an opportunity of seeing the handsome struc«ures erected at moat of these places, will regard with satisfaction the comparatively bojbll amount represented in the balance-sheet by landed property, bank premises and furniture —an amount which does not more ihan represent the real value of premises at head, office aud two or three of the principal branches; the cost of the whole of the remainder having been defrayed out of profits. Shareholders, I ana confident, will confirm the action of the board in recommending a further addition of £25,000 to the reserve fund, Vhich, with such addition will stand at the gratifying sum of £325,000. Nothing can more conduce to increase public confidence in the institution than the continued evidence of the shareholders' desire so strengthen their reserve rather than increase their dividend j and when we consider that we have made a return of 15 per. cent, for the past eleven years, with two exceptiops, when a reduction of 2\ per cent. wbb made, and that your reserve fund has within that period grown from £150,000 to its present amount, there cannot be other than a feeling of satisfaction at the policy pursued by the board. The figures in the balancesheet will, commend themselves to shareholders as evidence of a progressive business. Their magnitude, and the consequent heavy responsibility devolving on your board have a not unimportant bearing on a question which will come before you at a special general meeting, to be held immediately after this one closes. There has been an increase of circulation, deposits, and other liabilities, of about £730,000, while advances under all heads show an increase of about £800,000, other balances remaining much in the same position as in last . statement. Allow me to invite your attention to a very noticeable feature in the records of bankinglin the adjacent colonies, which has a reflex influence of the business of the banks in New Zealand. The sworn averages of the batiks shew, that during, the past year, iv Victoria alone, there has been the vast expansion of three and a half millions in advances, against an increase in deposits of little over one and a half millions, and there is no compensating feature in the published average of other colonies, in nearly all of which a considerable proportion of each bank's capital appear to be employed. The effect is seen in this colony, in the extreme rates offiered for deposits, a policy, which though necessary to adjust the capital accounts of foreign banks is certainly not calculated to promote the interests of New Zealand, and the consequence of which inuafc inevitably be a growing scarcity of money, and dearer rates for it so far as prudence will allow, we protect our own deposits ; but with such a presure iD tbe foreign banks, do effort of ours can prevent a large amount of the otherwise available capital of this colony finding its way to adjust balances in the neighboring colonies. It may be within the recollection of shareholders that, at the general meeting held on the 28lb, April 1865, it was in contemplation to initiate within the batik a guarantee and provident find for the officers of the establishment, and to whioh the directors recommended the bank should eontribnte. In consequence of the attention .of the board having shortly afterwards been called to the apparently superior advantages of the Colonial and Foreign Banks' Guarantee Fund, in London, it was decided to support

it in preference to tbe intended fund within the bank, a decision which has been long regretted. Experience has proved that, if the original intention of tbe Board has been carried out, the fundwould now have amounted to such a sum that would not only have given ample security to the bank, but would have afforded a certain prospect of reasonable provision for otiicers,, who from old age or ill-healtb> are obliged to retire frota tbe service. The director bow propose to revive the idea of the guarantee and provident fund, but as the great majority of the staff are already guaranteed in tbe London fund alluded to, and are not liable called upon for further contribbtion (unless under circumstances not likely to arise), they cannot with any fmrness be now a ß ked to contribute to mere than the provident branch of the proposed fund, Id enable the intended iund to start with a fair prospect of success, a liberal contribution will have to be made by tbe bank. Ihe subject haa been forced on the consideration of thte board by tbe necessity for already making B orne provision for officers retiring from the service under circumstances whioh demand recognition, and as the necessity for such provision will be a growing one as the bank increases, the expediency of providing a fund from which such claims can be met, eppeare not only reesonable, but almost compulsory. Details have not yet biea sufficiently worked out to justify the board i a Baying wh&l contribution will be tnade to the fund, but it has beten thought proper to invite the opinion of shareholders, in case it should not be in accord with that of the board. It is intended that henceforth all officers joining the service will be guaranteed within the bank, on terms somewhat similar to those of the Colonial and foreign Banks' Guarantee *und. From past experience it may be reasonably hoped that a fund will soon be accumulated which will aflord ample security and as the success of the provident fund will in a great measure depend on the absence of claims on the guarantee fund • tbe staff will have a personal interest in noticing the acts and habits of fellowpfficers, and will f ee l that en irregularity remaining uncorrecte-d may entail future personal loss. In conclueion, I have pleasure in recordJug the contioued rapid growth of the colony iq population, wealth, agricultural and pastoral prosperity, a growth which gives confident hope that, as m the past, our business in the future will prove progressive and remunerative. No better proof of the developing power of our railway system can be adduced than the rapid increase in the price of freehold lands, and no better broof of the prosperous circumstances and improving position of our population than its ability to acquire freehold homesteads. Amidst a prosperouscommunity banking must prosper and your directors claim to have carried out the policy of encouragiog all to look for legitimate accommedation according to their meaos, a policy justified by results, and warranting that ■continuance of support from the " public which haß always been so liberally extended to the Bank of New Zealand. With these remarks^ I beg to move the adoption of the report and balancesheet. :

Mr Fibth, in rising to second the adoption of the report, said : I shall have very little to say in seconding this resolution, mas much as the figures laid before you show with great clearness the position of the hank, the extent of its'operations, and their result with regard to profit This is done, in my judgment, as clearly as it can be done. The remaiks of the President have also elucidated the operations of the bank, leaving very little to be said in addition. There are, however, one or two points which, with your permission, I should like to notice. Among the remarks make by. the President was one to the effect that in the neighbouring colonies there is a difference of some two millions as betwixt the deposits received by the Victorian banks, and. the. advances made by them. This extraordinary discrepancy is likely to have a more or less adverse influence on banking operations in this country. It may have arisen, I think, from the circumstances of the colony of Victoria and the adjacent colpnies having suffered much during the last two yearß from unexampled drought ; this fact entailing great losses on the constituencies of all banks; requiring t! great support from these institutions to be given to their constituents. Every one present will be aware that this colony has not been exposed to any such severe periods of drought as the neighbouring colonies have suffered from lime to time. With the genial climate and fertile soil of this colony, we may expect & fair B hara of prosperity in the luture to an inetito. tion like this, whose fortunes are bound up with the interests of the country. There is auother matter in connection with the agricultural operations of this country, which has been already referred Jo by the Chsirman. It is a matter of great importance, indeed, when we are. considering: the future of iuethuiions of this description. This is, that owing to advantages of climate and other favourable circumstances, it has been tound possible to aid in giving to the land a perennial fertility, inasmuch as, by rotation of cropß, it has been found possible to preserve the growing powers of the soil from season to season. In the neighbouring colonies this has not been found possible, the greatest difficulty being found in those countries to raise root cropa and

artificial grasses. To take South Australia for instance, which is shut out from growing other crops than wheat } the effect of this means that it hag to export one of the main elements of its future prosperity, having little else to put in its place, sending awßy from time to time a most important element of its wealth in the shnpe of cargoes of wheat, which are not replaced by any other produce, in consequence of the Boil being unreplenished. We need, not, when we regard these circumstanced, be surprised to find that, while this year's yield has been on tbe whole equal to the average in some other colonies — 7| bushels to the acre— in this colony, taking the statistics for Canterbury alone, based upon the returns already made* the yield has been at the rate of 23 bushels to tbe acre. In this province — 1 have not seen any returns, but my experience enables me to arrive at a closely ap^ proximate festimatc— -tbe average yield has been M bushes. ibis is a result due to the advantages I have spoken of, thegenia 1 climate and the fertile soil with which we are here blessed. I look forward, therefore) to the future prosperity of this institution, based as it i's on such a solid foundation as that indicated by the natural advantages the country possesses. Having just returned from a visit to the Southern portions of this colony, lam well pleased to be enabled to state that 1 beheld there tbe elements of the highest prosperity and wealth.. 1 can confirm the remarks made by the President with regard to the buildings of this bank, having had an opportunity of inspecting a great many of them. I must say the selection of the sites reflect the greatest credit upon tbe early friends of this bank, inasmuch as they are placed in the very centres of business of the towns where they are erected. They present ali the' appearance of substantial and commodious structures, and would not disgrace any banking corporation. I have no doubt they are worth more than the amount set down against them. I have great pleasure in seconding.the that the report and balance-sheet be adopted. I have, no doubt that by means of the careful arid wise management : which has hitherto done so much for the institution, we may, expect still greater, profit to'.ttie shareholders, and not orilr to them but to the country at large-"-upon the advancement of which,, as a basr's, the operations of the bank will have to depend. The resolution of the adoption of the report was put and carried unanimously. Messrs. C. J. Stone and B. Tonks, were elected Auditors ; and after the customary votes of thanks, the meeting terminated. . - :