BANK OF NEW ZEALAND.

Stratford Evening Post, Volume XXXVI, Issue 48, 2 July 1913, Page 7

BANK OF NEW ZEALAND.

SHAREHOLDERS AX!) DIRECTORSTATED TEXT BY MR HAROLD BE A ECU AMR, in < ojuiectioi), with tlie recent meeting of shareholders of’ the Bank of X(>w Zealand, the ehainnan i,M>' H. Boauciiamp/ ,si|ys : —• As there seems to he some misapprehension on Hie point, I think it j,u.1l that the respective positions of tho shareholders and the-directors of j the hank should ho made clear, i ’l'jj,, founders of the bank were of (opinion that it was better in the interests of the institution that the [shareholders., should give up the right customarily held by the, shareholders of a company to control the policy ol the hoard ol directors. It is accordingly provided by clauses 3 and 4 if the deed of settlement of the bank as follows: —• "3. That the whole management of the business of the company shall he uul the same is hereby reposed in the hoard of directors hereinafter more particularly, mentioned, and that suh joct to the limitations herein contained and the powers hereby vested in general meetings of the proprietors the individual parties hereto do hereby for themselves severally and rcipectivety and for their several and respective heirs, executors, and administrators renounce and disclaim all right to interfere in the management of tho affairs- of tho company, ,or to inspect the books of the company or unless appointed by the board as heroin after-'povided to sign, accept, or 'endorse any hill, note, or negotiable security in the name of the company. ~r to enter into any other contract or engagement so as to charge oi hind tho jiqmpany or the properties funds securities or moneys of or belonging to. Aim company, and open party hereto hinds himself, Ids heirs,, executors' and administrators that he and they shall and will keep harmless and indemnified the company and their lands, goods, chattels, funds, and securities from and against all losses costs, damages, and expenses occasion jed by any contract or engagement made or entered into by him or them as aforesaid.”

“4. That it shall he lawful for tin board, at the expense of the company, to apply for and endeavor to obtain an Act of the General Assembly ol New Zealand to incorporate flip company; under tjio name andi,-style anc I title of ‘the Bank of New Zealand, and from time lb time such" other Act left*. Acts of the- imgialatpjj;© «ai(j colony as the bogrd may_cp.nsider cal c'i'lated to facilitate their legal remedies, and advance thdf general in t crests'of the company; and. for the purpose of obtaining, such". AW.aP'uH cp,yp9f{itton or such other;—Act or Acts as afeii'SErill it illiall Dhel'hohn .potent to the hoard,. onvlelmlfnof the. company, to comjrly .with such conditions as may be 'imposed by any such Act or Acts, anything in these presents inconsistent, with .the...provisions. such conditions notwithstanding; and every provision herein contained in consistent with the provHH*6ns ; of ’ stick Act or Acts shall during -the continual; the said Act shs,fended , and shall be of no-force and dfect’; Hut after'the expiration’of t)i< iaid' Act or Actsoby effluxioU' Of tilin' ;r otherwise ’ every 1 suc-li' 1 vprbvisior herein contained shall-be again in full

This was the (position at the'tirm alien the hoard was by statute cou>ti Luted as it is at present; and it if dandy the duty of the board to, take the responsibility of conducting the nisiness of tiie bank without direc;ious from the -shareholders. If the shareholders do not desire this, it

s open to them to move, under clause So of the deed of settlement, to amend the provisions of clauses 3 and I above referred to. Clause So reads as follows: “85. Tlmt it shall he lawful for the •proprietors by a special resolution to make new laws, regulations, and provisions for the company, ahd.fo amend alter, and repeal all or any of the existing laws, regulations, and provisions of the company, provided sue]' new amended or altered laws, regulations, and provisions do not extend to, amend, alter, or repeal all or ant part of the laws, regulations, and provisions .established and settled In these presents for limiting the individual responsibility of the' respective, proprietors of the company as between themselves.”

IT the shareholders pass siicli a resolution i it w ill then bo for the Government to determine if it will exorcise' tht> right given by statute to veto the resolution so passed.

It will be remembered that the Government has no voice by voting power in respect of the largo shareholding interest it now lias in the bank. Its shares confer no right to vote. Its interests are protected only by the directors it nominates, and by its power of veto. „ I may add that the Bank of New Zealand is not the only bank in which large powers- quite properly, I think are vested in the board of directors. For example, the charter governing tin 1 Mank'of Australasia provides that whilst it is necessary to obtain the assent of the shareholders, in general meeting, to an increase in capital, the terms and conditions on which such capital shall be offered to shareholders are expressly reserved to the directors, who alone are responsible for tlie safe conduct of the bank’s business.