THE BANKING ENQUIRY.

Waikato Argus, Volume I, Issue 29, 15 September 1896, Page 2

THE BANKING ENQUIRY.

(BY TELEGRAM!. —OWN* CORRESroXDKXT). Wkmzsotox, Lasc Night. At the Banking Committee, Mr Butt, Colonial Auditor of the Rink of New Zealand, was examined by Mr Seddou. After giving details respecting the different positions he hud held in the Rank, witness stited that tin: report of Mr Buckley's Committee in 1888 came partly as a surprise, as'hey did not tlrnk the position of the Rink at that period was so bad. The Rink's inspectors had sections of work, hut none of them *ook a comprehensive view of the whole position of the Rmk. tVhcn witness in ISSS went to London ho took statements with him showing the deficiency ot the Rink to bo £BOO,OOO, which deficiency was very much a question of the value of the securities. A contingency fund to about this anionnt was provided to be drawn up in as securities were realised and any deficiency tint occurred, the subsequent investigations proved that the amount had been written off for bad dclts. Despite the losses in 18S8 a dividend of seven per cent was declared. He would not li'-o t) express an opinion whether tlrs w.ts a a popcr thing to do. From the institution of the Rank till the present day over four nrllions s'erling hid bejn written oIF A Ued if it was a f ies 111 t two millions which hnl been written off oi tlr; Rink's Estates since 188 S did not disclose reckless trading. witnc?s ex plained th it certain deductons in the way of los-csi. that all Banks we.e liable to, would need to be mule. These deduct ions would not be caM'y nude. He thought he would not bo out of the way t.n cstimitc the ord nary lo=es of t'ie Rank at from 1-30,000 to C. 30,0()() yeatly. He hopil to be ab'e to reduce these losses by half now tint the Bank was being more strictly managed. A year ago wittio s would have put the estimate of the Rank's earni lgs higher than now, as in the interval the value of mo icy

::iul fallen very much. Tlr's fall was s> niii;h that <1 (posts with tho Bink were Jo-iny favour with depositors as they got so little fJf them. The Bank had to accept lower rates for advances, and had to keep more, cash money at short call. Until lie knew how maters would go in the future he would lie sorry to conucol his name with any estimate of the Bank's probable earnings. Witness approved of the steps taken ny the Government to save the Bank. He agreed that the failure of the Back would have been most disastrous to the colo-iy —not only this colony, but the Australian coluliies. The ll'iik had also been benefited by the Government assistance. Had the Bank of New Zealand closed its doors the effect would have, borne hard on the other colonies, where confidence whs just beginning to be restored. The Committee then adjourned.