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A Shareholder — I have great pleasure in seconding tiiat.

The motion was carried nem. con,

Mr. Utley — ^I propose a vote of thanks to the Chairman for his conduct
in ihe chair, and especiaUy for his minute attention to-day. He has not
atieiap ted to make an elaborate speech, as is the case with many chairmen,
w^ axe crammed from Parliamentary reports and blue-books, and then go
md make a speech of half an hour's length. The Chairman has not ififlid'H
anytiimg of that kind on us, and we tluink him specially for it.



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556 Anglo-Egyptian Banking Company.

The Chainuau — ^I have to thank you for both reBolutioiis— the first on
behalf of myself and ooUeagaes, and the officers in this coonlary and New
Zealand, and also for the kind way in which yon have receiyed the last
vote.

The proceedings then terminated.



THE ANGLO-EGYPTIAN BANKING OOBfPANY (LIMITED).

Thb half-yearly general meeting of this company was held on the 22nd
May, at the Cannon-street Hotel, London; Mr. G. G. Macpherson iiilhe
chair.

The Chairman— The secretary will read the notice oonvening this
meeting.

Mr. Octaye Foa, the secretary, read the notice convening the meeting.

The Chairman — Gentlemen, the report of the directors for the last half-
year has been for some days in the hands of the shareholders, and I shall
DO glad to know whether it is your wish it should be read, or will yon
consider it as read ?

Saken as read.)
le following is the report : —

<< The directors haye much pleasure in acquainting the shareholders
that the business of the bank continues to be yery satisfactory. In ac-
cordance with the resolution passed at the extraoniinary general meeting
held in Noyember, 1871, the second issue of 20,000 new shares of £20
each was made in December last, at £10 per share premium, and, with
the exception of a yery small number, they were immediately taken up.
The premium of £10 per share on the 20,000 new shares, amounting to
£200,000, has been carried to the reserye fund, thus raising that fond to
the sum of £300,000, the whole of which is inyested in English Goyem-
ment stock. The directors now declare an interim diyidend at the rate of
10 per cent, per annum on the paid-up capital of the company for the six
months ending 28th February last, free of income-tax, being the extreme
amount authorised by the articles of association. This diyidend (payable
on the Slst instant) amounts to £1 per share on the old shares, and 2s. 3d.
per share on the new shares, upon which only £5 capital was paid on 9th
December, 1872, and 8s. lOd. on the new shares paid up in full on the 9th
December, 1872. As required by the articles of association, one of the
directors, Mr. G. Sinadino, retires by rotation, and, being eligible, offers
himself for re-election. Mr. W. C. Harvey and Mr. Arthur Cooper,
the auditors, also retire, and, being eligible, offer themselyes for re-
election."

The Chairman — ^WeU, gentlemen, I dare say many of you will recognise
in this report a great similitude to some that haye preceded it at the same
season of the year, which is no doubt the case. Neyertheless, I will com-
mence the litue I haye to say on the present occasion by expressing a sin-
cere and hearty wish that it may be my priyilege, or the privilege of who-
eyer may occupy this chair hereafter, to recommend for your adoption
many such half-yearly reports, inasmuch as, if I were disposed, or rather
permitted, to occupy your yaluable time for hours, I am sure I ^ould
fail to discoyer or conyey to your minds any fact or truth that ouffht to
be more acceptable to the shareholders than that which is embodied and
expressed in a few words in the first para^ph of our report — ^^The
business of the bank continues to be yery satisfactory." I may be asked
— indeed, I haye been asked— what is the meaning of , or what are we to



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Angla-Bgyptian Banking Oompanjf* 567

Qodentaad by, these words 7 And I will tell the meetmg the meftniiig we
attach to them. In the first place, during the period embraced in this
nport we have made no losses ; in the second plMe, we have incurred no
bad debts ; in the third place, we have not had a single bad bill ; and
hotly (not the least important), onr profits at home and abroad have been
Tsry good, and continue to be so to the present time, whilst our relations
wiu His Highness the Ehediye and the Egyptian GoTemment continue
to be yery satisfactory, and much the same as they have been eyer since
the foundation of the bank. Well, now, as regards the second and third
paragraphs, it will be yery satisfactory to the shareholders to be informed
thatuie seoondisBue of 20,000 new shares at £10 premiumpershare has been.
as we anticipated, a yery greatsuccess, and hasenabled the directors,asBtatea
in the report, to add £200,000 to the reeerye fund, which now amounts to
£300,000. It will, no doubt, be in the recollection of many of the shareholders
now present that at the time it was recommended and afterwards resolyed
^n to create a reserye fund, you were informed by my collea^es,
Messrs. Masterman and Morrioe, who presided on the different occasions,
that it was the intention of the board to inyest the whole amount thus
reoeiyed in €k>yerDment Securities, and to keep that inyestment entirely
separate and apart from the working capital of the bank, in order that it
nught be in the true sense of the word a reserye always ayailable, and to
he made use of only in cases of sudden and unforeseen emergencies. In
accordance with these expressed intentions the board ayailed themselyes
of an early opportunity of inyesting the whole amount in consols, where
it now is in iaie joint names of the directors of the bank. When it is
home in mind that this is a limited banking company, with all its capital
paid up, the importance of possessing such a fund must at once be^me
apparent, and cannot be too highly appreciated, for it greatly enhances
the yalue of our property ; it inspires our shareholders and the public
vith confidence ; it adds greatly to the prestige, position, and credit of
the bank, and aboye all, it must proye a grand element of safety in
moments of panic and distrust, such as we haye seen inreyailing latdly in
Viecna and other Continental cities, and which to a cerUiin extent stUl con-
tinue. We must therefore bo prepared for such eyents, for the wisest can-
not foresee when such a crisis may occur. For this reason I think, gentle-
men, that we and our co-shareholders haye great reason to congratulate
onrselyes on the possession of such a fund. In accordance with our
statutes, as stated m the 4th paragraph of our report, we now declare an
interim diyidend at the rate of 10 per cent, per annum, for the half-year
ending 28Ui Feb. last, on the paid-up capital of the bank, free of income-
tax, payable on the 31st inst., which I doubt not will be acceptable ; and
from what I haye already said, I need scarcely acquaint you that we can
weU afford to pay this diyidend, and still haye a large balance for the
current half-year, at the end of which, when we make up our accounts for
the year, I hope we shall be able to show you yery satisfactory results.
(Cheers.) I haye nothing further to add, gentlemen, than to moyo that
me report of the directors be receiyed and adopted, but before formally
nattiiur the resolution I shall be yery glad to answer any questions to the
best of my ability.

Mr. Morrice— -Gentlemen, I haye much pleasure in seconding the
resdntion.

Mr. Brown — It is always amusing to me when I come here and hear
you ask us to pass the report when there is no report issued. I was in
hopes to haye had an approximate statement. Our chairman says we are
in a yery good position— that we haye done yery well, and that is aU we



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558 Anglo-Egyptian Banking Company.

knoir. I must repeat what I said last time : there should be some idea
given US of what we have made, and what our expenses are. Yon tell
ns what we all knew before — that there is so mnoh paid on the shares and
so much dividend, and then we are to elect directors. It is no election at
all, becanse we conld not propose anybody else— it is a farce. The meeting
held in the other part of the year is worth coming to, bnt this is a farce,
unless yon give ns some tangible aooonnt.

A Shareholder — ^May I ask what yon are going to do with the interest
on the £200,000 reserve ? Are you going to allow that to accnmulate, or
will you divide it ?

The Chairman — ^We do not intend to let it accumulate ; we intend to
carry it to the profit and loss account of the year. Well, in reply to Mr.
Brown, who stiettes that this is no report, I really thought, and I tiiink
now, it is a very good report. (Cheers.) And I must remind you,
gentiemen, tiiat precisely the same words, precisely the same argu-
ments, were used by the hon. proprietor two years ago, and last year
again, and a very (as I thought) satisfactory answer was given in telling
him that it was really impossible for us to give two accounts during the
year, because during tiie months of February and March the largest busi-
nesB is conducted in Egypt ; and Mr. Brown is an old enough proprietor to
recollect that we were absolutely forced to change our articles of aaaoour
tion because we had formerly another time, and we found that that so in-
terfered with our arrangements and our accoxmts that we at last agreed to
have half-yearly meetings, but not to produce any accounts at that time.
I therefore do hope our friend Mr. Brown will be satisfied, for really, if.
we were to repeat the same thing fifty times, we oouldnot say anythingmore.

A Shareholder — May I ask now much of tlie new capital is paid up in
fnll?

The Chairman— Almost the whole of it. There are as nearly as pos-
sible 15,000 shares paid up in full out of the 20,000, and upwards of 5,000
shares are payable in July and August.

A Shareholder — I believe there is a new Egyptian Loan in contemplft-
tion. are we likely to have any good pickings out of that ? (A laugh.)

Ijie Chairman— I think we £ui better stick to Ihe question ; we have
the question of the report before us, and I shall be happy to answer any
questions afterwards.

The motion for the adoption of Ihe report was then put, and oanied
unammously.

The Chairman— About the loan, as I have been asked a question, I have
only to ten the hon. proprietor and the zoeeting that this is a matter that
has been long looming in the distance, and there have been many negotia-
tions and many ideas that the thing was settled, and we have been told it
was settled, and at another time it was not settled, and such is the present
state of affidrs that, as far as we know, nothing is definitely arranged.

Mr. Brown — I presume you will never again take a loan on your own
account, but merely as agents of the Egyptian Qovemment. We haye had
enough of that before.

The Chairman — In my country there is an old saying that a burnt child
dreads the fire. Ton may rely upon it, whatever we enter upon or agree to
take, it will be by no means more than we can carry. G^tlemeu, I have
very great pleasure in proposing the re •election of our very able and zealous
colleague in Egypt, Mr. G. Sinadino. His services to the bank since its
first formation have been invaluable, and I hope we shall haye the good for-
tune to retain them for many years to come.

Mr. Edward Masterman— Gentlemen, it is my privilege to second that.



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Unum Bank ef Scotland.

iDdl can bew teBlimoixy to the inde&iigable maaiiar in wM^
diBohaigeB luB duties.

Th6 motion iras Gained nem. con.

Theretizing anditozs, Messrs. W. 0. Harvey and Arthur Cooper, were ze-
elected.

Mr. Brown— I beg to propose ayote of tlianks to you, sir.

A Shardiolder— -I second that.

The motion was carried by acdamation.

The Chairman— Ctotlemen, I beg to return yon my very best thauks, on
my own part and on the jwrt of my colleagues, and I have only to assure you
that our best exertions will be always at command for the benefit of this
hank. (Cheers.)

The prooeedings then terminated.



UNION BANK OF SCOTLAND.

Ahitsxxd is the forty-third amxoal report of the Union Bank of Scodandy
isiaed at Glasgow on the 8th May : —

''The diiectora have again the pteasore to submit to the ^HKipristors
the annual abstract sfcateman t d the bank's afiairs, made up as on
2iid April last. The profit and loss account of the year ended at that
dale sihowB, from the ordinary sources of revenue, a balance at credit of
£l«>44».3«.3d.; to which there falls to be added the sumof £14,521. 168.7d.,
b w q plitfro m the previous year ; making a total of £174,670. 19s. lOd., after
providing, as usual, for the bad and doubthil debts, and for the rebate on
oilla difloounted. Besides the ordinary profits, however, these have been
reooveriea in profit and loss acoount of an exoeptkmalkind, connected witiL
the final dosing of the did cotetanding aooounts, which, in 1862;
oocaaiaiwd anxiety, and to meet the anticipated loea on which, alarga sun
was, in that year, taken from thepbank^e'resi' The receipts from tms and
otiMraacfcnKsdinary sources amount to £62^7. 8«.7d The directors have
tetlier the satisfiiction to report^ that the business of the bank continues
steadify to extend,— the cash deposits, which, in 1862 wero six and a half
■fflioBfl^ lisnng risen to nine and a half millions in 1B73. This
fact makes it impottant to stvengthan further the proprietary
aooonnta of the bank ; and the directors propose to devote to
Aia porpoee the exceptional profits of the past year, and thezeupon to set

nroflka than they would otlierwise have done. In the opinion of the
dixectons the interestsof the individual propneton^ as wdl as of the ban^
viQ IJiiB be better served than by the oiBmbutiont in a aingiLe year, of a
poKtion of the extraordinary receipts by waj of bonus. They thereforo
eaaniiiioiiBly recommend as fellows : — ^Ist. lliat out of the ordinaryprofits
of the jear there be paid to the proprietors, on 2nd June and 1st Decern-
bar neoc^ in equal pEoportkns, a dividend at the rate of 16 per cent,
per muaua^ free of income-tax, £150fiOO. — ^2nd. That thero be applied in
r e d ne U an oi tiie cost of premises in the occupation of the bank, the sum of
fHUdfiOO. — ^rd. That from the extraordinary receipts of the past year there
be aBrtaned to the 'rest 'the sum of £62,000.— 4th. That t^ere be carried
teveid in profit and loss aooomit the balance, amounting to £15,118. 83. 6<^.
Thahank'8 < rest,' now standing at £312,000, wiU thenamount to £374,000,
\ at the whde year's dividend, and of the balance in {nrofit and
, wlddi togeUier amount to £165,118. &. 5(2. Besolutions wi



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660



Begtstering under the Companiee Act, Sfc.



be sabmitted to the meetisg for the paxpoee of altering certain of the
provimonB of the bank's oontiact^ and which, on being oonfinned at tiie
annnal meeting, to be held in May, 1874, will then come into operation.
The direoton who retlxe by rotation at this time are Mr. James Hamua
and Mr. Frederick Pitnum. In their room the directors reoommend the
election of Mr. Francis Maxwell, insnranoe broker, Glasgow, and Mr.
Samnel Hay, who, after acting for twenty-seven years as the bank's maoagor
in Edhibnrgh, has now retire from the active duties of his o£Boe."

Ahitraet State of Afairs, 2nd Aprils 1873.

¥.TAHTy.TTT»f-

Ucposits .•• ••• ••• ••• ••• •••

Balances dne to banking correspondents

Gonent drafts on London

Acceptances by the bank and thdr London agenti
Note drcnlation ••• ... ••• ••• •••

Total liabilities to the public

Capital paid np, £1,000,000 ; rest accoant, £3IS,000 ; profit
and loH account, Snd April, i87S,->balance brought
forward, £U,521. 16^. 7(1.; profit and loss aoconnt, 2nd
ApriU 1873— ordinaiy, £160,149. 3ff. td. ; extraordinaiy,
£62,U7. 8«. 7d,; total liabilitieB to the partners... . 1,549,118 8 5

£18,524,748 5 7



£ #. 0.

9,484,842 9 8

98,074 19 S

141,128 IS 4

304,621 16

947,262



£10,975,629 17 9



Bills of exchange, local and country bills, cash credits,
and other advances on secnxily ••• ••• ••• ••«

BankdBces: Glasgow, Edinburgh^ and branches •••

Consols, and other GrOTenunent secuitles, and short

loans in London, £2,808,787. 3s. lid. ; other secnrities

and investments, £885,372. lis, 9d, ; gold and silver cqIb,

and notes of other banks, £638,294. 12«« 2d



£9,029,975 17 8
162,317 17 1



3,332,454 10 10
£12,524,748 5 7



REGISTERING UNDER THE COMPANIES ACT WITH
UNLIMITED LIABILITY.

The annotuicement that four of the chief London Joint Stock
Banks will be registered with Tinlimited liability under the
Companies Act cannot fail to produce very beneficial effects on
the value of their shares. As is well known, the executor of a
testator who held a single share in either of these banks must
wait for three years after the sale of the shares, or even a single
share^ before he can legally distribute one shilling of the pro-
perty, because the amount of liability is doubtfol, and therefore
the entire property must be held answerable until the three
years after date of sale have expired and all legal responsibility
has ceased. There is no reason to doubt that the shareholden



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Bigisterinff under the Companies Actj 8fe'. 561

lese four banks will gladly avail themselves of the power to
ce this risk, or rather this absolute liability, from three years
le year, aud there is every reason to presume that other
aited banks will follow so good an example. The con-
Bnces will no doubt be much more extended than may
ar at a first view of the question. Apart from diminishing
duration of this overwhelming liability, the fact of these
B being registered under the Companies Act will direct
to attention to the numerous obscurities and shortcomings
ie Act itself, and may probably lead to the preparation,
more complete basis than the present, of a Bill consoli-
ng and amending the existing Acts, so as to make them
) efficient. The want of uniformity in the registration of
ifers will probably be one of the first matters to attract
)e, as bank shares are valuable securities and change hands
lently, owing to death and a variety of other causes. It
dns to be seen what arrangements will be proposed to in-
the registration of transfers with the least possible dday,
means should be devised to prevent vexatious objections, to
pt transfers which were unobjectionable, as this has in
ral instances led to expensive litigation. No doubt a cer-
amount of power should be vested in directors to prevent a
tantial shareholder from backing out of a tottering company,
substituting a man of straw to shake off all liability. But
t care must be exercised in this matter, and it is not safe
xist altogether to the caprice of any body of directors how-
honourable, as to accepting or refusing a new name, with-
stating some reason why they object to accept the new
eholder, or to allow an old shareholder to increase his
ing. There have been so many cases of this description
re the Judges have formed different opinions, that the law
ently requires elucidation, and no time should be lost in en-
'ouring to lay down certain rules with respect to transfers
5h shall remove some of the difficulties which now so fre-
itly present themselves. There is no difficulty in transferring
emment stocks or railway shares, and there is every reason
bope that the whole system of transfer may be much
>lified.

Te have observed that most probably other unlimited banks
follow the good example of somo of the principal compa-
, and register under the Companies Act, to reduce the
onsibiUty from three years to one ; but it is more than pro-
le that so far as banks are concerned the time may not be
iistant when they will feel the need of going a step further,
find it profitable to register under limited liability, which
VOL. XXXIII. 42



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562 Registering under the Companies Act, Sfe.

after all would only put them on the same footing as the Bank
of England, which has always been a limited liabUity company.
The step about to be taken by the banks, however, is only the
commencement of a much larger movement. All unlimited
companies subject executors to the same risk, and although the
subject has attracted very little attention imtil within the last
few years, the danger has always existed, and it is only
necessary to observe the records of the Chancery Courts to dis-
cover the extreme peril of allowing the continuance of unlimited
liability imder any circujnstances. The actual risk in many of
the large enterprises may be comparatively trifling, in fact not
worth a moment's consideration; but the collateral risk to
executors and trustees is so heavy, that if any plan can be sug-
gested to diminish the danger, or to get rid of it altogether,
surely no commercial subject can have a better claim to the
attentive consideration of Parliament. The registration of
these four banks will do more to direct attention to the imper-
fections of the Companies Acts than may at first be supposed,
and it is obvious, as the general feeling of society is daily gain-
ing strength in favour of the co-operative or joint-stock principle
being made applicable to all large ventures of every description,
that the chief care should now be to make the laws as intelligible
as possible, and to embody the numerous suggestions for im-
provement which ten years' experience has given. The law
should be adapted to the greatly extended system of joint-stock
enterprise which has sprung up within the last few yean.
There is no .analogy between the financial undertakings of 1862
and 1873. Everything is now on an entirely different scale, and
foreign enterprises especially may be made higUy profitable to
this country. The chief defects of the existing Companies Acts
are transfers and liquidations, both of which require to be re-
modelled. We have just endeavoured to explain some of the
points of difficulty in connection with transfer, but with liqni'
dations the case is much worse when the process of winding-up
is resolved upon either by the " wreckers," or as a matter of
necessity, in consequence of the concern being too weak to offer
any inducement for its continuance. It surely is not asking too
much in the public interest that every company which goes into
liquidation should be compelled to furnish periodical statem^ts
to creditors and shareholders. Under the present system of
winding-up, there is really no power to compel the liquidator
to furnish any information whatever, as a proof of which there
is the fact that no Parliamentary Beturn has ever yet be^ fur-
nished, showing what progress has been made with the old
companies winding up in Chancery, and not much with those
since 1862. This information could easily be supplied, and



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Communications. 563

would to a certain extent enable creditors and shareholders to
know their exact financial position. Something more than this
is, however, required, and nothing short of periodical statements
seat to every creditor and shareholder will remove the uncom-
fortable feeling which now exists with regard to the uncer-
tainties of liquidation.



(SJonramnications-



PAYABILITY OF CHEQUES.

To the Editor of the " Bankers" Magazine.'*

Sir,— A. B. makes a cheque payable to A. H. H. or order. This cheque
is presented to the bank on which it is drawn throngh another bank in the
same town. It bears two endorsements — ^the first one the name of B. H.,
and the second one the name of the payee, A. H. H. The signature of the

eyee is believed to be genuine, and there is no reason to suppose B. H.
s fraudulently obtained possession of the cheque. Would it 1^ the duty
of the bank to pay the cheque, or would they be justified in returning it
on the ground that the first endorsement was not that of the payee ?
—2. Also, supposing a cheque was made payable to Jones and Brown, or
order, and endorsed ^'^Brown and Jones," would it be strictly legal to pay
tiie cheque, or should it be returned for correction ?

BUSTIO.

[1. Assuming the first endorsement by B. H. to be general, and not special
to,A H. H., the cheque should be paid.— 2. We think, so endorsed, the bank
would be justified in refusing to pay.]



Liverpool, 19th May, 1873.
D&LK SiB^— I shall be much obliged by your answering the following



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