BANK OF NEW ZEALAND

Taranaki Central Press, Volume IV, Issue 455, 12 June 1937, Page 6

BANK OF NEW ZEALAND

PAST YEAR’S OPERATIONS

Volume Of Business Maintained

Wellington, June 11. “An interim dividend of 5 per cent, on ordinary shares was paid in December last, and a further 5 per cent, is now being paid, making 10 per cent, for the year,” stated the chairman of directors, Mr A. T. Donnelly, at the annual meeting of the Bank of New Zealand to-day. In his review of the year's business the chairman stated: Deposits, £35,636,112, show little variation. Coin, Reserve Bank notes and deposits with bankers, £7,929,471, are more by £1,016,330 than at March 31, 1936. Money at call and short notice, Government securities and other securities in tfendon stand at £7,122,420 — a reduction of £1,050,000. Bills receivable in London and in transit, £l,338.924, which is lower by £935,947 than a year ago. The fluctuations in these three items are mainly due to the diversion of the dairy produce exchange to the Reserve Bank from August 1 last. New Zealand Government securities, £4,626,094', show an increase of £1,229,037. The purchase of Treasury Bills and short-dated stock accounts for the higher figure. Australian Government securities, £2,995,900, are lower by £1,591,913, sales having been made from time to time to replenish our cash funds in Australia. Advances and bills discounted, etc., £23,663,948, show an increase of £l,484,575.

The deposits and advance figures of the six trading banks for the March quarter of 1937 show some material changes as compared with the corresponding period of a year ago. The total average deposits have increased by over £600,000, but a marked movement has taken place in the two classes of deposits, free deposits having increased by £5,291,080, while fixed deposits are lower by £4,603,926. Advances have increased by £1,834,874. For easy reference the figures for the past five years are quoted, all in thousands:

The figures of the Bank of New Zealand alone for the March quarters 1936 1937 £ £ Advances .... 19,313,871 20,389,409 Free deposits .. 12,047,328 14,163,568 Fixed deposits . 18,323,955 15,894,536 Our advances in the March quarter of 1936 and 1937 were: — of 1937 represent 68 per cent, of our total deposits, as compared with 63 per cent, for the corresponding quarter last year. The percentage of fixed deposits to total deposits is 53 per cent., as against 60 per cent, in 1936. The free deposits, fixed deposits and advances of this bank represent 43 per cent., 47 per cent., and 4r3 per cent, respectively of the total figures of the trading banks in New Zealand for these items.

The trading banks’ deposits with the Reserve Bank at March 29 last amounted to £8,880,494, approximately £5,300,000 in excess of the statutory balance required to be maintained. The London funds of the Reserve Bank, and the funds of the trading New Zealand business, together amounted at March 29 to £(N.Z.) banks held in London relative to their £30,147,010. Trade Figures. The value of exports for the year ended March 31 last was greater than for any previous year in the history of the Dominion. For purposes of comparison, the figures of exports and imports in sterling for the past five years are quoted, all in thousands:

Exports for the year ended March 31, 1937, are higher by about £8,500,000 compared with the preceding year, the chief factors being the increased values of wool and dairy produce. Import figures are up by over £8,000,000. The excess of exports over imports is still more than sufficient to meet New Zealand’s oversea interest bill and other recurring external charges. Nevertheless, the large increase in the import figures prompts me to suggest that merchants should keep a watchful eye on the trade figures when considering their orders for im-

poYtations. The Dominion is enjoying a period of relative prosperity. The high prices obtained for wool and increases' in the production of, and returns from, butter and cheese have largely added to the farmers’ resources, and trade has benefited accordingly. In addition, the Government has embarked upon an extensive public works policy and has also by legislative enactment restored wages to their 1931 level, thus adding considerably to the people’s spending power, though these better conditions have been offset to some exitent by increased cost of living.

It is pleasing to be lable to report that, having regard Ito the magnitude of the bank’s operations, comparatively few of our customers have applied under the- Mortgagors and Lessees Rehtebilitaltion Act for adjustment of their liabilities to .creditors other than the bank; but as, under the Act, an application for the adjust, ment of any liability involves a review of Ithe applicant’s whole position, the blank has necessarily been concerned in all such applications.

The chairman has given you a very full account of matters affecting the business of the Bank as well as of the Dominion during the financial year under review, stated Mr William Watson, in seconding the motion adopting- tftie report. He has alluded to the removal from the trading banks of the exchange business built up by them in many years in connection with their .assistance to Ithe dairy industry. Notwithstanding khat loss, however, by sharing in the haltural progress of the Dominion, enhanced by the recent rise in values’ of the principal exports, the results for the year are shown to be satisfactory.

Remarkable as the progress of New Zealand hag been, it has become a matter of concern of late that in recent years the increase in Ithe population has not kept abreast of that intofeher parts of the British, commonwealth. Many have already made public their views as to -the absolute necessity of steps being taken to secure ia greater population for the safety, development, and trade of the counltry. Railways, roads anu I harbours, have been prepared at heavy .cost, and, by want of sufficient use, several of them are now burdensome to the dis-ti lets' and (to the nation. The motion for the adoption of the .report was carried after a short discussion. Mr Gibbs took the opportunity of thanking fellow shareholders for the I very heavy vote they had cast in his* j favour in th£ recent election. He ) took it their votes not only indicated I their confidence in him to continue ■ to look aflter their interests, but that | -h.ey also-indicated that in their opin- | on further changes on 'the board at he present time would not be in .heir interests. During the year the bank , passed its 75th milestone and 'he board decided to grant the staff a special bonus, which jaction he felt hey would ail endorse, Mr Gibbs also drew attention to a I ■able which appeared recently in -the j Press reporting Mr Walter Nash • making a statement to the effect that the Government had no intention of nationalising the trading banks. That statement, he thought, should dismiss various rumours of I late regarding the Bank of New Zealand. f *l can only say your representatives have no information and know no more about these rumours than you do yourselves,” he added.

March Free Fixed Quarter Deposits. Deposits. Advances £ £ r 1933 .. 17,461 35,208 48,500 1934 .. 21,657 39,455 41,575 1935 .. 23,965 37,135 43,077 1936 .. 27,194. 38,405 45,105 1937 .. 32,485 33,801 46,940

Year to Excess of March 31. Exports. Imports. Exports &Stg. £Stg. £Stg. 1933 32,677 22.049 10,628 1934 .. 36,834 20,908 15,926 1935 . . 35,985 26,082 9,903 1936 .. 39,900 30,072 9,828 1937 .. 48,381 38,250 10,131