RESERVE BANK OF NEW ZEALAND. ANNUAL REPORT OF THE BOARD OF DIRECTORS AND STATEMENT OF ACCOUNTS FOR THE YEAR ENDED THE 31st MARCH, 1941.

Appendix to the Journals of the House of Representatives, 1941 Session I, B-16

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1941. NEW ZEALAND.

RESERVE BANK OF NEW ZEALAND. ANNUAL REPORT OF THE BOARD OF DIRECTORS AND STATEMENT OF ACCOUNTS FOR THE YEAR ENDED THE 31st MARCH, 1941.

Presented to both Houses of the General Assembly pursuant to Section 20 of the Reserve Bank of New Zealand. Amendment Act, 1926.

ANNUAL REPORT.

To the Hon. the Minister op Finance. The Board of "Directors presents hereunder the report on the operations of the Reserve Bank during the financial year ended the 31st March, 1941. On the 31st December, 1940, the term of appointment of Mr. Leslie Lefeaux as Governor expired. The Board at its next meeting placed on record its appreciation of the distinguished services rendered to New Zealand and to the Bank by Mr. Lefeaux during his term of office as first Governor of the Bank. After making such provision as was considered necessary for depreciation and contingencies, the net profit for the year amounted to £351,906 10s. This amount has been paid into the Public Account to the credit of the Consolidated Fund. The decrease in expenditure of approximately £16,000 was due in the main to a large decrease in the cost of the note issue. Fresh purchases were on a lower scale during the year under review, and as a measure of war economy, notes are now reissued to a larger extent than heretofore. Salaries paid again showed an increase, due largely to the increased staff needed to cope with the administration of the Finance Emergency Regulations 1940 (No. 2). Revenue for the year was less than that for the previous year by £25,575. Advances to the Marketing Department were throughout the year at a lower level than during the year elided the 31st March, 1940, but the reduction in revenue from this source was offset by an increase in revenue from the Bank's holdings of British Treasury Bills. Smaller income from investments in Government Stocks and from other sources thus accounts for the decline shown. The principal changes in the balance-she'et as at 31st March, 1941, compared with that of the previous year were as follows : — Liabilities. Bank Notes. The increase of approximately £3,000,000 in bank notes outstanding was a continuation of the upward movement shown in the preceding year. Throughout the year the figure for notes outstanding was consistently higher than in the corresponding periods in the previous year. The effective note circulation—that is to say, notes in the hands of the public—totalled at the 31st March, 1941, £17,162,096, being £2,326,837 higher than at the last Monday in March, 1940. Demand Liabilities. (a) Stale : The decline of £586,008 from last year's figure represents a decrease in the sums held in the " Wool Account" awaiting distribution. (b) Banks: Trading banks' balances declined by £1,600,835 to £12,843,770. As these balances fluctuate considerably from month to month, this decrease calls for no special comment. (e) Other: The balance under this heading increased by £679,777 to £931,872 ; this item also fluctuates widely throughout the year, and at 31st March large amounts were held temporarily at the Reserve Bank on account of certain overseas banks. Assets. Sterling Exchange. The increase of £4,079,223 was due to the high level of export income in conjunction with delays in deliveries of licensed imports. Advances. To the State or State Undertakings:— (i) Marketing Department: The advances under this heading include a deficit in respect of the guaranteed price for butter and cheese accumulated prior to the war, and the remainder is accounted for by the fact that payments are made to suppliers before receipt of the purchase price from the United Kingdom Government. (ii) Other Purposes : Although these advances had been throughout the year largely in excess of the figure of £15,500,000 as at 31st March, 1941, the Government, before the balance date, had paid off all advances under this heading other than those for housing purposes

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Discount Rate. The discount rate was altered to 2 per cent, on the 27th May, 1940. The rates quoted since the Bank commenced business are as follows :— Per Cent. As from Ist August, 1934 .. .. .. .. .. 4 As from 29th July, 1935 .. .. . . .. .. 3f As from 2nd March, 1936 .. .. .. .. .. 2| As from 29th June, 1936 .. .. .. .. 2 As from I.9th November, 1938 .. .. .. .. .. 4 As from 6th September, 1939 .. . . . . . . .. 3 As from 27th May, 1940 .. .. .. .. .. 2 Exchange Rate. The Bank's official buying rate for sterling remained unchanged and no official selling rate was quoted. Management op Public Debt. Interest-free Loans for War Purposes. It was arranged that all persons lending money to the Government in response to the appeal by the Minister of Finance for interest-free loans should receive New Zealand Government Stock for the amounts lent. The Bank undertook the management of these interest-free loans, contributions to which totalled £2,589,563. Of this amount, £1,142,182 was converted into New Zealand Government War Loan, 1953, leaving £1,168,381 outstanding at 31st March, 1941. New Zealand Government War Loan, 1953. The Bank issued the prospectus of this loan on the 26th September, 1940. It is non-interest bearing until the Ist October, 1943, but thereafter interest will be paid at the rate of 2|- per cent, per annum. Subject to the provisions of section 41 of the New Zealand Loans Act, 1932, this Stock will be accepted at par in payment of death duties at any time before maturity in respect of the estate of the original holder. It was indicated in the prospectus that the Minister of Finance would not regard any person as having subscribed in proportion to his means unless that person had subscribed at least the amount of the income-tax payable by him in respect of income derived during the year ended the 31st March, 1939, decreased in the case of individuals by £50 and in the case of companies by £70. Individuals, and companies who had already made interest-free loans were given the option of converting them to this issue. In addition, persons who had made gifts of money direct to the War Expenses Account were permitted to reduce their contributions to the loan by the amount of such gifts. ' On the 18th October, 1940, a Gazette notice was issued requiring all persons and companies to subscribe to the loans on the terms 'set out above. The closing date for applications was extended to the Bth November, 1940. The total applied for under this loan was £9,284,737, including the above-mentioned amount of £1,421,182 converted from interest-free loans. The Bank decided not to make the usual issue and conversion charges to the Government for the work undertaken in connection with this loan, whilst the trading banks and the Stock Exchange Association of New Zealand agreed to forego the commissions ordinarily payable to them. New Zealand Government National Development. Loans, 1945 and 1956-59. On the 3rd January, 194-1, the Bank issued a prospectus for these loans. Two classes of Stock were offered : — (1) 3-per-cent. Stock maturing 15th July, 1945, at an issue price of £100. (2) 3|-per-cent. Stock maturing 15th January, 1956-59, at an issue price of £97 ss. The closing date of the loans was not fixed nor was any maximum amount specified. The proceeds of these loans are to be used for general development purposes comprising railway construction, hydro-electrio development, land development and afforestation, housing, roads and highways and public buildings, including telegraph: and telephone extensions. As at 31st March, 1941, the loans were still open, but the shorter-dated loan has since been closed. The Board desires to place on record that the task of issuing the above-named loans was greatly facilitated by the helpful co-operation of the trading banks and the Stock Exchange Association of New Zealand. Exchange Control. So far as licensing of overseas trade is concerned, the procedure has not substantially changed except that the fifth licensing period covers the whole of 1941. Previous licensing periods covered six months, though in some cases an extension was made. Net overseas assets continued at a level which rendered it unnecessary on the whole to "■ spread " approved remittances during the year under review. A fuller degree of control was, however, taken over foreign exchange transactions by the Finance Emergency Regulations 1940, which were introduced in April, 1940. These regulations eliminated the free exchange market by prohibiting all transactions (other than those officially approved) involving the taking or sending of money or securities from New Zealand, or disposing of any money or securities held or payable abroad. At the same time, any foreign exchange transactions at other than the current exchange rate were also prohibited.

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In June these regulations were replaced by the Finance Emergency Regulations 1940 (No. 2), which, in addition to re-enacting the measures of control over exchange transactions, provided for the registration of privately-owned overseas currencies and securities of New Zealand residents. So far as Exchange Control is concerned, the effect of these regulations and subsequent amendments is as follows :— (a) Foreign Exchange Transactions : All transactions must be made through the appropriate official channels —i.e., the Reserve Bank or the trading banks as its agents according to the nature of the transactions—and in accordance with authority granted by the Reserve Bank. (b) Dealings in Foreign Securities : Foreign Securities may not be dealt in except under qertain specified conditions. Securities situated or registered overseas may be sold if the buyer is another New Zealand resident and payment is made in New Zealand in New Zealand currency. If the buyer is not another New .Zealand resident, the foreign currency must be made available to the Reserve Bank or one of its agents. Securities on the New Zealand register of concerns having a register both in and outside New Zealand may be dealt in provided that, except with permission of the Reserve Bank, no transfer is made from a resident to a non-resident or to an overseas register. (c) Acquisition of Gold Coin and Bullion : The Minister of Finance is empowered to require New Zealand residents who hold gold coin or gold bullion to offer it for sale to the Reserve Bank at a price to be determined by the Minister of Finance, having regard to the current price of gold in London. So far no action has been taken under this regulation. (d) Returns of Foreign Currency, Balances, Fixed Deposits, and Securities : Every New Zealand resident is required to furnish to the Reserve Bank returns of his holdings of foreign currency, balances, fixed deposits, and securities. Residents must offer to sell the currency and to assign the balances to the Reserve Bank, the price to be determined by the Minister of Finance, having regard to the current rate of exchange. With respect to the foreign securities, the Minister of Finance " if he is of the opinion that it is necessary or expedient so to do for the purposes of strengthening the financial position of New Zealand " may transfer to the Reserve Bank any of these securities at a price to be determined by the Minister, being not less than the market price at the date of transfer. No action has yet been taken by the Government to transfer such securities, or the currencies mentioned above, but the returns have been received and recorded by the Reserve Bank. The Exchange Control system makes it possible for the first time to make a detailed statement of foreign exchange transactions. The following table gives a classification of the transactions for the years ended the 31st March 1940 and 1941. The 1940 figures are not as complete as those for 1941 owing to the existence of the free exchange market up to the 10th April, 1940.

Summary of Transactions.

Overseas Trade. Exports: For the year ended 31st March, 1941, exports reached the high level of £71-2 million, compared with £59-7 million in the previous year, an increase of 19 per cent. Tbe disparity between the value of goods exported and the total of export proceeds received during the year 1940 is explained by the fact that, under the United Kingdom purchase agreement, those receipts included approximately £10 million which would otherwise not have come to hand till after the end of the year. At the same time, however, export prices rose by 10-9 per cent., so that the increase in the volume of exports was 7-6 per cent.

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(£(N.Z.)000). Year ended I Year ended lleceipts. 31st March|31st March Payments. 31st March 31st March 1940. | 1941. I 1940. 1941. Ill respect of— in respect of— Exports .. .. ■■ 70,975 73,302 Imports, excluding payments in respect oi 37,868 42,015 Interest, dividends, legacies, immigrants' 1,588 4,220 Government, imports and in respect of goqds funds, repatriated capital, and private debts , imported prior to introduction of licensing due in New Zealand system Trade debts due in New Zealand, including 1,734 3,443 Interest, dividends, legacies, emigrants'funds, 3,187 3,935 overseas earnings of New Zealand firms repatriated capital, and private debts due Commissions, royalties, and insurance .. 08 120 overseas Donations and allowances .. .. 312 382 Trade debts due overseas, including earnings 4,071 2,759 Travellers' expenses .. .. • • 270 280 in New Zealand of overseas firms and payLocal body loan raised overseas .. .. 322 .. ments in respect of goods imported prior Government loan raised overseas .. .. 2,500* .. to introduction of licensing system Unclassified .. .. •• 683 965 Government debt and other services, including 14,084 19,628 payments in respect of imports Local body debt services .. .. 1,634 3,635 Commissions, royalties, and insurance . . 323 538 Donations and allowances .. .. 547 622 Film hire and entertainments .. .. 293 343. Travellers' expenses .. .. .. 727 274 , Unclassified .. .. . ■ ■ 43 15 78,482 82,712 63,357 73,704 * Sterling Loan from trading banks since repaid.

B.—J (i.

Changes in the volume and value of exports of the principal commodities are as follows : —

Changes in the destination of exports have been as follows :—

Imports : The value of imports shows a small rise-for the year, the recorded value being £(N.Z.)47-9 million, as compared with £(N.Z.)45-6 million for the previous year, an increase of 5-l.per cent. (The actual costs were probably somewhat higher than the recorded values owing to the additional freight and insurance charges arising from the war. In the recorded figures for imports such charges have continued to be taken as .10 per cent, of the value in the country of origin, whereas 20 per cent, would probably be a truer figure in present circumstances.) During the year, however, wholesale prices of imported goods rose by about '20 per cent., so that actually the volume of imports fell by about 12-6 per cent. Changes in the countries of origin of imports are shown in the following table :—

These annual figures do not reveal substantial changes which have occurred in more recent months. For the first quarter of 1941 imports from the United Kingdom fell to 38-5 per cent, of the total for that period. Canada's share rose to 9-7 per cent, and that of the U.S.A. to 16-0 per cent. Net Overseas Assets and Balance of Trade: The following table shows the movements during the past seven years to the end of March, 1941 : — (£(N.Z.)million.)

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Volume (Thousands). Value (£(N.Z.)000). 1939-40. 1940-41. Change. 1939-40. 1940-41. Change. Per Cent. Per Cent. Batter .. .. (cwt.) 2,412 2,579 - 6-9 16,345 17,824 + 9-1 Cheese .. .. „ 1,674 2,327 +39-0 6,094 9,421 +54'6 Beef ... .. „ 828 1,468 -f-77-2 1,461 2,864 +96-1 Lamb .. .. „ 2,818 2,759 — 2-1 9,366 9,764 + 4-2 Mutton .. .. „ 1,312 1,299 —,0-9 2,155 2,384 +10-6 Pork „ 415 519 +25-2 1,422 1,868 +31-3 Wool .. .. (bales) 790 782 - M 12,640 15,121 +19-6 Other .. .. .. 10,201 1.1,934 +17-0 Totals .. .. + 7-6 ' 59,684 71,179 +19-3

Value (£(N.Z.)000). Percentage of Total. 1939-40. 1940-41. 1939-40. 1940-41. United Kingdom .. .. .. .. 50,540 59,813 84-7 84-0 Australia .. .. .. .. .. 2,108 2,267 3-5 3-2 Canada .. .. ... .. .. 1,033 2,290 1-7 3-2 United States .. .. .. .. .. 2,869 3,035 4-8 4-3 Other .. .. .. .. .. .. 3,132 3,774 5-3 5-3 All countries .. .. .. .. 59,684 71,179 lOO'O 100-0

Year Ended March. Country of Origin of Imports. Value (£(N.Z.)000). Percentage of Total. 1940. 1941. 1940. 1941. United Kingdom .. .. .. .. 20,760 22,145 45-6 46'2 Australia .. .. .. .. .. 6,631 • 7,789 14-5 16-3 Canada .. .. .. .. .. 3,178 3,314 7-0 6-9 U.S.A. .. .. .. .. .. 5,304 6,425 11-6 13-4 Other .. .. .. .. .. .. 9,699 8,246 2J-3 17-2 All countries .. ._. 45,572 47,918 LOO-O 100-0

End of March. Net Oversea* Assets. Balanoe of Trade (iweive Months). 1935 .. .. .. .. 45-2 12-4 1936 .. .. .. .. 44-1 12-2 1937 .. .. .. .. 34-4 12-6 1938 .. .. .. .. 26-6 6-9 1939 .. .. .. .. 9-3 3-5 1940— March .. .. .. 23-0 14-1 June .. .. .. .. 27-4 19-8 September .. .. .. 22-2 20-4 December .. .. .. 23-4 24-7 1941 : March „ .. 29'8 23-3

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The unusually large balance of trade for the year ended the 31st March, 1941, contributed to the increase in net overseas assets revealed by the above figures ; but had it not been for delays in the arrival of goods ordered under license, both the balance of trade and the total of net overseas assets would have been very materially lower. As a consequence of these delays, fourth-period import licenses were to a considerable extent still not utilized when they lapsed at the termination of that period on the 31st December, 1940. The relative unused exchange authorities were accordingly cancelled also ; but the overseas funds thereby released were thereupon reallocated for imports of the fifth period, which covers the whole of 1941. Thus, after making the necessary allowance for the. Reserve Bank's statutory reserve requirements and certain other commitments, the net overseas assets held by the Reserve Bank and the trading banks on the 31st March, 1941, represented, not a freely disposable surplus, but a fund which had already been allocated to provide for fifth-period imports. In March, 1941, a sum of £4 million sterling was made available in London by the Bank, partly for payments due to the United Kingdom Government in respect of the Dominion's overseas war expenses, and partly to redeem sterling Treasury notes issued in London in terms of the New Zealand Government's Export Credit Agreement with the United Kingdom Government. Trading Banks. The position of the trading banks as shown by the main items in their monthly returns has been as follows :—

Assets.

Liabilities in New Zealand.

The figures show a rise of £7,042,000 in demand liabilities and a fall of £2,616,000 in time liabilities. The ratio of demand to total demand and time liabilities has thus risen, from 59-9 per cent, to the high level of 65-2 per cent. Throughout the year there was a steady rise in their holdings of Government Securities, but a sharp fall in March, 1941, lias resulted in a net fall of £1-1 million since the 31st March, 1940. Advances and discounts remained relatively steady throughout the year until March, 1941, when they rose by £6,398,000 largely because of accommodation granted on account of primary products in store awaitiii"' export. The proportion of advances and discounts to total demand and time liabilities rose during the year from 61-8 per cent, to 65-2 per cent.

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(£(N.Z.)000.) Deposits at Reserve Total Cash AT , ,, „ • Advances Reserve Bank in New Net Over- Government Bank. Notes. Zealand. 8eas Assets ' Securities. Digommtg 1940. March ! 13,862 3,544 18,049 9,988 16,540 48,161 April .. .. .. 15,341 4,294 20,377 10,771 15,892 49,541 Ma y ■■ 15,765 3,785 20,273 11,542 15,892 49,556 June .. .. .. 16,212 3,918 20,840 12,572 15,903 47 457 July •• 16,737 4,258 21,695 12,555 15,992 46,102 August .. .. .. 17,522 4,424 22,632 12,508 16,001 45,379 September.. .. .. 15,438 4,161 20,280 12,213 17,074 46,586 October .. .. 13,253 4,007 17,904 12,417 17,257 47,476 November.. .. .. 13,964 4,179 18,822 12,420 17,302 47! 263 December .. .. .. 12,720 5,226 18,623 11,916 17,519 48,079 1941. January .. .. 14,322 5,491 20,580 13,161 18,519 46,710 February .. .. .. 16,485 4,941 22,177 14,179 18,525 47,282 Mar ch •• •• 12,832 4,279 17,860 12,239 15,434 53,680

(£(N.Z.)000.) Demand Time Total Demand and Liabilities. Liabilities. Time Liabilities. • 1940. March .. .. .. 46,640 31,246 77,885 April .. .. .. 48,163 31,251 79,414 May. .. .. .. 48,071 31,815 ' 79,887 June .. .. .. 49,113 31,387 80,500 July .. .. .. 48,423 30,745 79,168 August .. .. .. 48,831 30,870 79,701 September .. .. 48,158 30,576 78,734 October .. .. 46,731 30,352 77,083 November .. .. 48,204 29,735 77,939 December .. .. 49,684 29,376 79,060 1941. January .. .. 52,115 29,110 81,225 February .. .. 56,060 29,010 85,070 March .. .. .. 53,682 28,630 82,312

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Post Office Savings Bank. In spite of the calls made on the public by way of taxation, savings certificates, war loans, and patriotic appeals, the deposits in the Post Office Savings Bank showed steady improvement throughout the year. (£(N.Z.) millions.)

Prices and General Business Conditions. The principal price indices have fluctuated during the year under review as follows (1926-30 = 1000.)

According to the above, indices the price increases recorded have been small, except in the case of imported goods ; the rise in the latter was, of course, mainly responsible for the rise m the wholesale-price index under the heading " All Groups." Thus it is seen how the Dominion s internal price structure has been affected both by wartime costs of production m overseas countries, particularly the United Kingdom, and by increased freight and insurance charges arising from the same cause. On the whole, business has been maintained on a fairly high level of activity. Aggregate incomes and the value of production have increased, while the value ot domestic trade as shown by sales-tax receipts, has remained steady. But as the value of domestic trade is expressed in higher prices (the causes for which have already been referred to), it follows that the volume has shown a decline. ... t -i n The diversion of a considerable proportion of the national income and of available man-power towards production of capital goods and equipment for war purposes, coupled with the withdrawal of large numbers of men from civil life into the armed forces, cannot fail to involve a decline m the normal consumption of goods and services. . .' , In these circumstances the maximum possible contribution by members of the community to war loans, including National Savings Accounts, would not only have the effect of helping the Empire s war effort, but in addition would enable the financial structure of the Dominion to bear the inevitable strain of war. conditions with the minimum disturbance of prices. Staff. At the 31st March the permanent male staff numbered 68. Of this number '20 have proceeded or are proceeding overseas in the Royal Navy, the N.Z.E.F., and the R.N.Z.A.F. ,5 are on full-time home defence- 10 are in the National Military Reserve and the Territorials, lractieally without exception the remainder of the male staff (including 7 juniors who are still ineligible for the Territorials and a number of others who are medically unfit for overseas or home service) are undertaking duties in the Home Guard and the Emergency Precautions Scheme: A number of the female staff are undergoing training in nursing and other war services.

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i wii i i Excess Credit Year ended 31st March, Deposits. i Withdrawals. Deposits. Balances. I mr, . .. '24-2 ! 20-9 3-2 ! 49-4 iqo a " " .. 25-6 : 23-5 2-1 52-9 qo? .. 30-7 27-0 3-6 j 58-1 1938 " .. 33-0 29-6 3-4 63'1 iqqq " . 30-4 34-6 —4-2 60-7 iq4Q ; .. 25-2 29-5 | -4-3 58-0 19 4X .. .. .. .. 28-6 25-3 1 3-3 63-0

Retail. Wholesale. Kxport. All Imported Locally Pro- All tood. Groups. Items. dueed Items. Groups. 1940 March .. 1007 1060 1012 1218 1073 1158 A-nrii 1010 1073 1017 1236 1090 1175 J, lv ■ 996 1078 1029 1248 1096 1185 r.''I 995 1071 1026 1263 1089 1190 Tulv " " " 1000 1074 1027 1292 1083 1205 August " " ■ ■ 988 1070 1042 1334 1073 1225 September" ' .. 995 1095 1050 1351 1077 1236 Sober 991 1087 1048 1380 1075 1253 November " .. 998 1087 1054 1383 1083 1258 December 975 1084 1053 1390 1099 1268 1941 Tanuarv ' ' 1002 1076 1050 1406 1091 1274 February " " •• 992 1077 1056 1410 1099 1280 March " .. 986 1081 1057 1416 1110 1288 Change for year (per cent.) .. J -2-l +2-0 +4-4 +16-3 +3 4 +11 2

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The staff during a strenuous year have continued to carry out their duties efficiently and well, and the Board desires to record its appreciation of their loyal services. For and on behalf of the Board of Directors : W. F. L. Ward, Acting-Governor. E. C. Fussell, Deputy Governor. 27th June, 1941.

Profit and Loss Account for the Year ended 31st March, 1941. Dr. £ s. d. Cr. £ s. d. General charges, including salaries, rent, Balance of profit after making provision cost of note issue, and other expenses 139,181 18 1 for rebate on Treasury Bills not yet Balance, being profit for year .. 351,906 10 0 due, and for sundry liabilities and contingencies .. .. . . 491,088 8 I £491,088 8 1 £491,088 8 1 Profit and Loss Appropriation Account. Dr. £ s. d. Cr. £ s. d. Payments to New Zealand Government Balance at Ist April, 1940 .. .. 361,363 610 in terms of section 36 of Reserve Bank Balance from Profit and Loss Account 351,906 10 0 of New Zealand Act, 1933 .. .. 361,303 610 Balance .. .. .. .. 351,906 10 0 £713,269 16 10 £713,269 16 10 Balance-sheet as at 31st March, 1941. Liabilities. £ a. d. Assets. £ s. d. General Reserve Fund .. .. 1,500,000 0 0 Gold (at face value) .. .. 2,801,873 10 0 Banknotes .. .. .. 21,440,822 10 0 Sterling exchange .. .. 17,536,569 9 9 Demand liabilities — Subsidiary coin .. .. .. 82,333 17 7 (a) State .. .. 6,269,551 0 5 Advances to the State or State under(b) Banks .. .. .. 12,843,770 511 takings— (ej Other .. .. .. 931,872 9 8 (1) Marketing Department .. 2,926,463 0 6 Liabilities in currencies other than (2) For other purposes .. .. 15,500,000 0 0 New Zealand currency .. .. ' 7,260 1 2 Investments .., .. .. 3,772,322 4 0 Other accounts .. .. .. 820,894 5 9 Other assets .. .. .. 1,546,515 1 1 Profit and Loss Appropriation Account 351,906 10 0 N.B.—Holdings of sterling have been converted into New Zealand currency at the rate of £100 sterling equals £(N.Z.)124 £44,166,077 2 II £44,166,077 2 11. W. F. L. Ward, Acting-Governor. E. C. Fussell, Deputy Governor. W. R. Egc.ers, Chief Accountant. Auditors' Certificate and Report. —We have audited the balance-sheet as at 31st March, 1941, above set forth, and have obtained all the information and explanations we have required. We have accepted the certificate of the Bank of England as to assets held on account of the Reserve Bank of New Zealand. In our opinion the balance-sheet is properly drawn up so as to exhibit a true and correct view of the state of the affairs of the Bank as at 31st March, 1941, according to the best of our information and the explanations given to us and as shown by the books of the Bank. D. G. Johnstonl i,• i , , . J X Griffin f Account/tints, Auditors. Wellington, New Zealand, 20th June, 1941.

Approximate Oust of Payer.—Preparation, not given ; printing (525 copies), £12,

By Authority: E. Y, Paul, Government Printer, Wellington.—l94l.

Price (kl.]

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