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THE LONDON AND PROVINCIAL BANK, LIMITED. The ordinary general meeting of shareholders was held at the City Terminus Hotel, Cannon-st., on Wednesday July 30th; Mr Brinley Nixon in he chair. Mr Robsrt Garden (the secretary) read the no- tice convening the meeting. The report and ac- counts were taken as read. The Chairman said: In accordance with an understanding arrived at some time since among your directors, that we should in turn preside at our half-yearly meetings, I have the honour of doing so on the present occasion. I am now one of three left of the original directors of the bank, and have been engaged for a period exceeding fifteen years in the supervision of its business and the ad- ministration of its affairs. Notwithstanding this somewhat extended experience and apprenticeship, however, I should have had some diffidence in appearing before you for the first time as the re- presentative of the board, were it not that the re- port and balance-sheet which are submitted to you to-day are such as to require, I think, no efforts of oratory or diplomacy in order to obtain for them your approval and confirmation, while I am also sure that there is no question which can be put to me on any matter connected with the affairs of the bank to which I am not able to reply in terms satisfactory alike to its shareholders and customers. The duty of representing the bank from this side of the table for several years past has appeared to me a not unenviable one—the gentlemen discharg- ing it having always had to deal with balance- sheets which have showed steady progress and prosperity in the business of the bank. I am glad too on this the first occasion on which I have the honour of addressing our shareholders that the re- port and balance-sheet of which I have to ask their approval are such as I venture to think they will consider as satisfactory as those which have been previously laid before them. (Cheers.) In our ac- counts to-day no doubt there are two points which to anyone not conversant with banking and the special circumstances of our business might at first sight appear open tu. unfavourable comment. The first, that the profits of the last half-year are some- what less than those of the preceding six months. The second, that our expenses show an increase. With regard to the first of these, I need hardly tell the proprietors, as men of business, that the past six months has been a period of continuous and almost unequalled depression-a depression, too, of a nature which has come home to the door of almost everyone engaged in the commerce or the agriculture of the country. The profitable working of a bank must be largely dependent upon the well- being of those among whom its operations are conducted, and seldom have there been worse times —as well in commercial as in the agricultural dis- tricts-than the present. Our profits have also been adversely affected by the low value of money which has prevailed during the last half-year, the average bank rate having been X2 13s, as against X4 17s 6d in the preceding six months. This has more particularly affected that part of the bank's business which consists in the discount of first-class bills—of which we have now considerably more than formerly-while it hasJurther been adverse- ly influenced by the larger amount than usual of unemployed surplus money we have, from various reasons, had on hand. With these unfavourable influences to contend with, I think we have good reason to be satisfied that our profits have been what they are; and that, in spite of them, we have been able to maintain our usual rate of dividend, after making very ample provision for bad and doubtful debts. (Cheers.) Let me say particularly that the board have performed the last-named task in no perfunctory manner, but-aided by our ex- cellent general manager, Mr Cross—have carefully gone through every single debit account in the whole bank where we have believed there to have been even a possibility of loss. Our desire has been in no single instance to take a sanguine view of any doubtful account, and it has only been after going through them all in the most critical spirit that we are able to assure you that very ample pro- vision has been made for bad and doubtful debts, and that it is only after such ample provision has been made that our profits have been estimated. (Cheers.) I may add that the amount of bad debts we have had to write off and provide for during the past half-year has been very moderate-that we have no locks-up of capital, and no large or undue advances to any one firm or individual. Now, as regards the increase of expenses, this, I may shortly say, represents that rendered necessary by the very considerable additional business which has accrued to our institution in consequence of the suspension of the West of England Bank. My predecessor in the chair,Mr Lewis,on the occasion of our last meeting, went very fully into this subject, and told you our opinion of the prospective value we attached to this accession of business in South Wales. He told you, however, that it would be rather in the future than in the immediate present that we should experience the full benefit of it. How valuable it has been to us already, the in- crease in our customers' balances—in the face of the bad times-is one satisfactory evidence, and I have little doubt this will be further proved in succeeding balance-sheets. (Hear, hear.) So far, therefore, from our increased expenses—repre- senting as it does this increase of valuable business —being a subject of regret to our shareholders, I have no hesitation in saying that I consider there is no feature in our accounts which they have, in truth, better reason to regard with feelings of complacency. With these preliminary observations, I will now, with your permission, proceed to go through the balance-sheet seriatim. The first item is our capital. The paid-up capital amounts to X225,440, being an increase upon the amount in the last balance-sheet of X25,440, the result of the issue of the 5,088 new shares alluded to in the re- port. Reserve fund— £ 116,825 —exhibits an in- crease of Y.12,000 in the half-year, made up by the dividend on the stock-£1,648-and X10,352, part of the premium on the new shares. Customers' balances—. £ 2,059,324—is X210,103 more than last time, and I would here call the proprietors' atten- tion to the fact that this is the first time that our balances have reached two millions. (Cheers.) The increase is attributable to the business acquired through the failure of the West of England Bank, and we expect to see a further increase from the same source when the full amount of claims on the West of England Bank has been paid. At the time our balance-sheet was made out only 10s in the « £ had been paid. Profits for the half-year— £ 52,501 —show a decrease of XI,269 upon the previous ac- count. This arises from the low value of money during the last few months, and to our having a larger amount of surplus money than we required owing to the difficulty of lending it for short periods in good banking securities. Turning to the other side of the account, cash in hand and at call, Y,452,771, is Y-32,735 more than last time. Investments -X507,217- show an increase of £ 153,905]; consists of high class investments, composed of debenture and preference stocks of the leading English railways, and a certain amount of Indian railway Government guaranteed stocks. It will be satisfactory to you to know that our in- vestments are worth at the market quotations in this morning's Stock Exchange list X17,063 more than they stand at in our books. (Applause.) If you will add the cash in hand and investments to- gether you will find that they amount toX959,988 —nearly a million of money-representing more than 46 per cent. of our entire customers' balances, in an immediately available form, and you will appreciate what a great position of strength and security this feature in our accounts is. (Hear, hear.) Bills discounted and advances to customers, Xl,430,554, is an increase of £ 61,4/3. Premises and furniture-C31,509-is X3,349 less than in the last balance-sheet. The ac- count would have shown an increase instead of a decrease, as we have purchased-for about half, I believe, of what they cost to build-our Chepstow freehold premises, consisting of a fine block of two distinct buildings, one occupied by the bank for offices and manager's residence, and the other let to first-class tenants, and other premises, but for the X7,500 of the premiums on the new shares which has been applied to its reduction. The board took this course from a desire that every item in the asset side of the balance-sheet should, without any doubt, represent twenty shillings in the X, or the worth of twenty shillings in the £ and further, that the premises account, however valuable the property represented by it, should not grow out of fair proportion to the paid-up capital. (Cheers.) You may be interested in knowing that, amongst other premises included in the account, there are our freehold banking premises at Norwich, Diss, Lynn, Yarmouth, Eye, Harleston, Tenby, and Sutton; copyhold, at nominal fine, at Fakenham; long-termed leasehold, at a ground rent, nearly equal to freehold, at Lewishamand Surbiton, where some time since we built fine premises; also long leaseholds of a valuable character at Newport, where we are just finishing the erection of bank premises, and at other places. The amount written off premises during the last few years, including the present amount of 17,500, is £ 15,500; and we have besides charged the cost of fitting up and furnishing many of the new branches established during the last eight years to current expenditure. I have no hesitation in saying therefore that at present the premises and furniture are intrinsi- cally worth more than they stand at in the accounts. Expenses, X27,968, show an increase of £ 3,867, which, as I have before explained, is simply caused by our larger business and the three additional branches opened in December last on the failure of the West of England Bank. Interest paid, XIO,771, is X2,831 less than last time, by which the bank makes an economy owing to the low rate of interest prevalent for money. This, gentlemen, completes the balance-sheet, and, glancing for a moment at the report, you will ob- serve the paragraph informing you of the issue of 5,088 new shares pro rata among the shareholders. As you were informed by circular of the 22nd of February last, the new shares were allotted in the proportion of one new share to eight old ones. And the number that were not so divisible, with those not taken up by the allottees, were allotted to the shareholders pro rata on application, the ap- lications exceeding six times the number of shares available. In the next paragraph you are informed that the reserve now amounts to < £ 116,825 6s 4d, and, as I have already explained the increase,1 need now only direct your attention to the concluding portion of the paragraph, which informs you that this amount is invested, separate and apart from the bank's other investments, in New Three per Cents. The gross profits for the half-year, after making provision for bad and doubtful debts, and including the amount brought forward from last account, are Y,59,202 9s 5d, and after deducting in- terest on new capital, current expenses, income- tax, directors' remuneration, auditors' fees, and interest to customers, there remains a balance of X20,462 3s 2d. The directors recommend that this amount be appropriated in the following manner, viz.:—< £ 12,500 to the payment of a dividend, at the rate of 12t per cent. per annum, free of income tax; X3,203 18s lOd to rebate on bills; X4,758 4s 4d carried forward. No other point occurs to me that I need detain you upon, and I beg therefore to move the adoption of the report and balance- sheet, but, before putting it to the meeting, shall have pleasure in answering any question that may be put to me. (Cheers.) Mr James Goodson seconded the motion. In reply to the only questions which were asked, the Chairman stated that having 5,000 shares to issue it only gave one share for every eight, and, therefore, the new shares could only be offered to those shareholders who held at least eight shares. The directors would like to please all the share- holders, but, unfortunately, they could not do so in this case. (Hear, hear.) The whole subject of the remuneration of the officials was gone into very carefully every February, and the board were anxious to deal with them as liberally as possible. The Bank sustained no loss whatever by the failure of the City of Glasgow Bank. The motion was then unanimously adopted. On the motion of the Chairman, seconded by Mr Edwin H. Galsworthy, it was resolved—" That a dividend for the half-year ending 30th June, 1879, be declared at the rate of 12 j per cent. per annum, free of income-tax, on the capital of the bank." Mr Figgess, pursuant to notice, moved that the remuneration of the directors be increased to X2000 per annum, and in doing so quoted a few statistics showing that the proposal was a very reasonable one, when the progress which the bank had made was considered. The customers' balances in 1875 were XI,405,891, they were now £ 2,059,324. The investments, other than the reserve fund, were in the same year X354,592, and they had now risen to £ 390,391. The reserve in the same period had been increased from £ 30,110 to RI16,825, the branches and agencies from 59 to 75, and the divi- dend from 10 to 12 per cent. This showed that 2 there had been a large increase of business, and this could only have resulted from the zeal and ability with which the bank had been directed and managed. If this vote were passed the directors would have .£250 a-year each, and as two of their number attended by rotation at the bank, and there were weekly board meetings, he did not think that could be considered very much to pay them. (Ap- plause.) Mr Coates, in seconding the motion, said that in four and a-half years the capital had increased 50 per cent., the reserve fund 385 per cent.—which was an enormous increase-the current and de- posit accounts 50 per cent., the dividend 25 per cent., and the proportion of reserve to capital had risen from 16 per cent. in 1874 to 52 per cent. in the past half-year. Up to 1874 they had been in- creasing steadily and quietly, but since that time the progress had been even more satisfactory. The motion was unanimously adopted. The Chairman, in returning thanks, said the di- rectors would not have allowed this to be put if they had not felt that they were fairly entitled to' X250 a-year each for the time and attention which they gave to the affairs of the bank. In reply to a question, The Chairman said the Blackheath business was now their own, and had been paid for. On the motion of Mr Warne, a vote of thanks was passed to the directors for the able manner in which they had conducted the affairs of the bank. The Chairman having briefly acknowledged the compliment, moved a cordial vote of thanks to Mr Cross, the general manager—(applause)—and to the staff of the bank. Mr Cross combined every quality that a manager could possess-energy and prudence in the very highest degree. They had every reason to be grateful to the officers of the bank for the assiduity and careful manner in which they dealt with the business of the bank. (Hear, hear.) Mr Hingeston seconded the motion, which was carried. Mr Cross said he was very much obliged to the meeting for the compliment which had been paid the officials of the bank from both sides of the table. It was very pleasant to hear such kind re- marks made. A great deal depended on the branch managers, and they ought not to be forgotten. The bank was principally an agricultural bank, and a good deal lately had been heard about agri- cultural depression, which did not tend to make the duties of the branch managers more pleasant. (Hear, hear.) The way in which they discharged their duties could not be too highly commended, and notwithstanding that in some cases the sala- ries were of necessity moderate, the duties were discharged most faithfully. He had no doubt the other officers of the bank would appreciate as much as he did the vote which had been passed. (Hear, hear.) On the motion of Mr Foulsham, seconded by Mr Figgess, a vote of thanks was passed to the Chair- man for his courteous conduct in the chair. The meeting then terminated.




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