Bank of New Zealand.

This Bank was founded in Auckland in 1801, but its promoters were uncertain whether it should be incorporated by Royal Charter or established by an Act of the General Assembly. Its capital was to consist of £500,000, in shares of £10 each. Its paid, up capital was to be £250,000, to be called up as follows:—2s 6d per share on application, 17s 6d on signing the deed of settlement, and 20s a share after signing the deed, and the balance of 60s per share, making the total of 50 per cent., if required, in calls of not less than three months thereafter.

The provisional trustees were—for Auckland: Messrs. J. L. Campbell, Thomas Henderson, James O'Neill, Thomas Russell, and James Williamson. For Wellington: Messrs. A. D. Brandon and W. B. Rhodes. For Nelson: Mr. H. E. Curtis and Hon. E. W. Stafford. For Canterbury: Hon. F. A. Weld and Mr. J. Cracroft Wilson. For Otago: Messrs. E. M. Glashan and John Jones. For Hawke's Bay: Mr. J. Watt. For Marlborough: Messrs. W. H. Eyes and J. Sinclair. The prospectus stated, inter alia:—"It is manifest to those who have devoted attention to the subject, that the banking establishments in New Zealand have derived immense profits, which are payable entirely to a foreign proprietary, from a trade carried on with the funds of the colonists, a circumstance which must lead to the consideration whether the colonists of New Zealand are not now in a position to enjoy, and entitled to receive, whatever advantages can be derived from the employment of their own capital."

The people of Auckland manifested much interest in the proposed Bank, and when the share list was opened it was found that 10,000 shares, representing £100,000, were taken up in what was then known as the capital of New Zealand. An equal number was reserved for London, where aboard of director was to be appointed at an early date. All the shares that were allotted to Sydney were taken up, while in Wellington and Christ-church the proposed Bank was greatly in favour with the public.

A special general meeting of the share-holders took place at the Mechanics' Institute, Auckland, on 1st October, 1861, to appoint directors and auditors. There were one hundred and eighteen shareholders present. On the motion of Mr. Buckland, seconded by the Hon. E. W. Stafford, Mr. James Williamson presided. The director chosen were Messrs. J. L. Campbell, Thomas Russell, James O'Neil, Thomas Henderson, G. Burgoyne Owen, C. J. Taylor, and James Williamson. Captain Daldy and Mr. Samuel Browning were appointed auditors, and Mr. Alexander Kennedy general manager.

Business was opened at Auckland, where the head office was fixed, on the 16th October, 1861; at Taranaki, on November 11; at Dunedin, on 2nd December, and at Wellington and Nelson on 15th January in the new year.

The first half-yearly meeting was held at Auckland, on 30th April, 1862, when it was stated that "only 1175 shares remained un-appropriated." The paid-up capital amounted to £108,785, and a dividend at the rate of 6 per cent, per annum was declared, £3000 was page 21 carried to the formation of a reserve fund, and £726 13s, the balance, was carried forward to open the profit and loss account.

The day after the meeting the New Zealand Government account was transferred from the Union Bank of Australia to that of the Bank of New Zealand. Mr. Fox was at the time the Premier of the colony.

The second half-yearly meeting was held on 30th October, when the paid-up capital amounted to £179,468, and a dividend at the rate of 10 per cent, per annum was paid. £6,000 was added to the reserve fund, and £894 carried forward.

At the same half-yearly meeting the directors met the shareholders with a London Board of Directors appointed, and a branch there in full operation.

At the third meeting the paid-up capital amounted to £239,592. A dividend of 10 per cent, was declared, the reserve fund was increased by £24,000, and amounted to £33,000.

At the October meeting of 1863, a dividend of 10 per cent, per annum was declared on the paid-up capital of £249,373, the dividend amounting to £12,468; the reserve fund was increased by £27,000, and the balance of £1724 carried forward.

A sixth call of £1 per share was made for 21st January, 1864.

At the April meeting of 1864 the paid-up capital of the Bank was £313,842, on which a dividend of 10 per cent, per annum was paid, while the reserve fund was increased by £35,000, and £2259 was carried forward. At the next two meetings, beside the 10 per cent, dividend that was paid, a bonus of per cent, per share on the half-year, making for the 12 months a payment of £61,030, beside an increase to the reserve fund of £20,000, and £2691 carried forward. At the last meeting in April, 1865, the directors initiated a guarantee and provident fund for the officers of the Bank by a donation of £1500, which was supplemented by at least three other donations of £500 each.

From the meeting held in October, 1865, to that held in October, 1867, both meetings inclusive, a dividend of 10 per cent, per annum was paid, and a bonus of 7s per share on a capital paid up of £500,000, being at the rate of £42,500 per half-year, the reserve fund standing at £150,000, with a balance carried forward at the last-mentioned meeting of £116,118.

From the April meeting of 1868 to the October meeting of 1870, an uniform dividend of 10 per cent, per annum was paid, and a bonus of 5s a share on the capital of £500,000, the reserve fund standing at £150,000.

The year following, 10,000 new shares were issued at £3 premium, which increased the capital to £600,000 and the reserve fund to £180,000. A sum of £45,000 was paid in dividend and bonus at the April meeting, while £7389 was carried forward. The ordinary dividend and bonus were not declared until the October meeting of 1872, when the bonus was reduced to 2s 6d per share, and this rate of bonus obtained tor two years, when, at the October meeting of 1874, £15,000 was again distributed among the share-holders. In 1876 the capital was increased to £700,000, and the reserve fund to £250,000, the increases being provided for by the issue of new shares at £5 premium and the accumulation of profits.

In 1875, the capital was further increased to £725,000, and the reserve fund to £275,000, the increase to capital being premiums on 2500 new shares issued to the Fiji Banking Company, while the reserve fund, which at the October meeting of 1877 was made £300,000, the Chairman (Dr. Campbell) saying, "This sum, shareholders will be pleased to learn, does notarise from any adventitious source, but from profits, the result of increasing business."

During the next eighteen months the capital of the Bank remains at £725,000, while the reserve fund increases £25,000 every six months. The usual dividend of 10 per cent, is paid, and the bonus of 5s a share. In October, 1879, the Bank's capital is made a million less £19,700, the par value of 1979 shares of £10 each held in reserve, while the reserve fund was announced to be made £555,000.

At the meetings of 1880 a dividend of £50,000 and a bonus of £25,000 were declared, which rate of dividend and bonus obtained throughout 1881.

At the April meeting, in 1882, the reserve fund was increased by £25,000; and at the October meeting of the same year a like addition was announced to commemorate the Bank's attaining its majority, which the president stated had dispensed £1,862,000 in dividends during its career.

The year following, at the October meeting of 1883, the president said the balance of profit-and-loss account is greater than the circumstances . . . might have led us to expect, and, with the balance brought forward from last half-year, enable us to maintain our dividend and bonus to make the handsome addition of £25,000 to our reserve fund, and to open the new half-year with a balance of £8,900 10s 4d.

Up to the October meeting of 1886 the usual dividend and bonus were paid when only 2s 6d a share bonus was declared instead of 5s through, the chairman said, the Bank "having sustained exceptional losses in Australia;" and he added, "but for the visible improvement in our future prospects we further had it in contemplation to transfer £50,000 from the reserve fund."

In April, 1887, a sum of £125,000 was taken off the reserve fund; and in the October meeting it was stated that the directors did not feel warranted in declaring a dividend.

In April, 1888, a dividend at the rate of 7 per cent, was declared, and a shareholders' committee was appointed to confer with the directors and to report on the state of the Bank.

At the October meeting in 1888, the capital of the Bank was written down to £700,000. and reserve fund transferred to the "bad and doubtful debts account." A dividend was paid for the half-year of £24,500, and the sum of £33,968 carried forward.

At the October meeting of the same year a like dividend was declared.