Poverty Bay Standard. PUBLISHED EVERY WEDNESDAY & SATURDAY. SATURDAY, MAY 7, 1881.

Poverty Bay Standard, Volume IX, Issue 941, 7 May 1881, Page 2

Poverty Bay Standard.

PUBLISHED EVERY WEDNESDAY & SATURDAY. SATURDAY, MAY 7, 1881.

We shall sell to no man Jtistice or Right ; We shall deng to no man Justice or Right; We shall defer to no man Justice or Right.

It is a misfortune of a bi-weekly paper, that it cannot deal with all the subjects that crop up from time to time ; and, therefore, perforce, some of them have to wait their turn for editorial comment. One of these, and not by any means the least important, is the half-yearly report of the Bank of New Zealand, a portion of which was published in our columns on Saturday last; and on which we now desire to make a few remarks.

Of the many public and monetary institutions started in this Colony, certainly the Bank of New Zealand is one to be congratulated on the supereminent success to which its financial operations has attained. Seldom has the Bank of New Zealand—at any rate, for many years past—declared a less dividend than an equivalent of about 15 per cent. ; besides carrying forward a large surplus to the next term. But it .is not so much our desire to congratulate the management of a wealthy institution, as to draw attention to one or two matters cognate thereto, and which come within the scope of general observation. Of course it is all very nice for shareholders to know that their investments are bringing them in such a handsome return ; and particularly when we reflect that their money, is, practically, unproductive in any essentially colonising way. In fact the Chairman says so, almost in our own words. He is reported to have said : “It will be observed that our re- “ sources remain abundantly ample “ for every contingency, and while “ not disposed to encourage or foster “ speculative business, we are fully “ prepared to take advantage of any “ opportunity largely to increase legi- “ timate transactions.” Now what we disagree with in this and other monetary establishments is, that while they aggregate their capital, ostensibly for the furtherance of Colonial enterprise, their real and only object is to realise big dividends. This view is borne out by almost every word uttered by the Chairman, anil the mover and seconder of the adoption of the report. We fancy we see the Hon. James Williamson, while “ washing his hands with invisible soap, “in imperceptible water,” making the unctuous exclamation : “ I am glad to “ congratulate shareholders on our “ ability to maintain our usual divi- “ dend ; and ” (with a little more saponaceous plaster) “to carry for- “ ward such an amount as practically “ ensures the continuance of a like “ return for the next half-year:” There it is in a few words. Ourselves. We, the shareholders, have been successful in lending money on terms and conditions which would put Shylock to the blush, and gloat over the prospect that the next half-year will produce a like result. Not a w’ord escaped any of the speakers as to the beneficial usefulness the Bank has been to the Colony. No disclosures (perhaps there were none to make) as to what extent the employment of the money —out of which a huge profit of ninety-nine thousand eight hundred and one pounds, sixteen shillings and twopence resulted—had been productive of good. Nor the slightest indication as to what particular, or in what general way, Colonial enterprise had been developed. Rather the reverse, for the Chairman says the disposition of the Bank is not “ to encourage or foster speculative business.” And in reply to a question, the General Manager said, that out of the £6,796,416 19s. sd. worth of bills due to the Bank, not a thousand pounds’ worth was locked up in land, for, he continued, “ we do not have any business of that sort.

If w 7 e view these, what, for the w ant of a better name, are called “ Banking establishments,” in a proper light, there can be no doubt that they are a Curse to the country. They are sources of despotic usury. Man-traps and financial delusions of the first water. If they really desire to benefit the Colour, why do they not reduce their tariff, and, instead of adding to their half-yearly glorification of large dividends, let. the commerce of the country receive a share of the benefit? It is to these “ successful ” monied institutions that are to be traced a large number, of the financial embarrassments that take place. No man in business can afford to pay what is tantamount to 20 per cent, for money. But it is done in thus supporting the usurious exactions of these money tinkers. And where do these big dividends go to ? If it were a fact that the profits of these Banks were put to some reproductive account in the Colony, there would be a kind of negative satisfaction in it.; but w ? hen it is remembered that a large proportion of them are drawn by absentees who live at home in ease, fattening on the misery and misfortune that they cause their dupes, it is time to pause and search beneath the surface of every day facts. We do not go so far as to say that the “ accommodation ” the Banks render to persons, is not worth the price paid for it. But it must not be forgotten that the true worth of an article is in exact relation to what benefit accrues to the purchaser or borrower, And, t irfi this connection, observation show's that, probably, 90 per cent, of those who borrow, or buy “ accommodation ” from the Banks, come to grief. There is hardly a case in bankruptcy in which one or other of the Banks is not the largest creditor r And why ? The answer is not difficult. Because, w'hen there is a plethora of unoccupied cash, they are but too ready to grant facilities to borrow’; not for the purpose of doing the borrower a good turn, but with an eye to the dividends. Then, wffien the money must come in, trade may suffer, their customers go the -—— well, w T all ; but the pound of flesh must be weighed, and the dividends furnished therefrom. No one can be more liberal supporters of proper and reasonable circulating media than ourselves : but it is an: opinion we long have held, and experience has not altered it, that while our banking institutions pay such high dividends, they do more real mischief than good; while that fact is an unanswerable argument in favor of a reduction of the terms and conditions on which they do their business. The further remarks made at the meeting are as follow :— Mr. C. J. Stone said: I rise to second the adoption of this report and balance-sheet. I need only repeat the words that have fallen from the Chairman, and congratulate the shareholders on the improved and improving condition of the Colony. I think we pre getting something better known at Home and to the world than w r e' have been in the past. Our Colony is admitted to be a fine field for emigration. The salubrity of its climate, its vast mineral resources, and its wheat and wool-producing capabilities have attracted general attention. Almost every week the arrival of grain ships in England from the Colony during the grain season must also tell our friends that we occupy, and shall, in all probability, continue to occupy, a permanent position as one of the large grain-producing countries of the world. That is already admitted as regards the South. As regards ourselves, in the Northern part of the Colony, that has not been so well known or admitted. I think, how'ever, that the portion of the Colony which more immediately concerns us is becoming more the object of attention, and that its great advantages have become patent to observation. I remember, many years ago, being told by a gentleman in Wellington, somewhat sneeringly, as I thought, “ O yes, I daresay your scoria land around Auckland will produce grass.” I rejoice to think it does produce grass, but it is well able to produce grain and beef as well. It produces the finest wool, in large quantity and in a very short time. I believe there will be in this province of Auckland a large area of wheatproducing lands. I believe the great M'heat producing qualities of a large proportion of land in the North Island have as yet scarcely been tapped. I believe it will pay the settlers well to grow 7 wheat. Hitherto settlers have not grown wheat, because they could invest their money more easily in

other ways. I know of a gentleman who came here some time ago, and finding that he could so profitably invest his money here, he contented nimself with working hard on two acres of land while he invested his money beneficially in other ways. The difficulties of the Colonies are passing away, and, with our Chairman, I entertain tlie hope that settlement may soon be largely increased. This is scarcely the place to touch on politics, but I am tempted by the remark of the Chairman, that the finance of the Colony having been put on a satisfactory footing, he expressed a hope that it might so continue. I hope that, as a legislator, our Chairman will use his position and opportunities to secure so deisrable a result, so that the Colony of New Zealand may maintain the position which its climate, its mineral resources, and its fertile land give to it. I have much pleasure to second the report aed balance-sheet. The report and balance-sheet were adopted unanimously A Shareholde : I would ask the directors how soon the £6,796,416 19s 5d in bills discounted, and other debts due to the Bank, would be available, suppose a time of pressure should arise ? The General Manager: I am permitted by the Chairman to answer the question. 1 may state that the sum is invested in the ordinary operations of a Bank, a proportion of it in very short-dated bills, some in the ordinary accommodation to customers by way of overdraft; but if the gen tieman means to ask whether there is any large amount, locked up in lands, I may state that there is practically not a thousand—we do not have any business of that sort.