COMPANY MEETING

MARTINS BANK

LIQUID POSITION TRADE DEVELOPMENT ESSENTIAL MR. F. A. BATES' REVIEW

THE 109th annual general meeting of members of Martins Bank, Limited, was held at the head office, Liverpool, Tuesday, January 23rd.

Mr. Frederic Alan Bates, the chairman, who presided, said : The report and accounts show the continued progress of the bank, and I trust you will share our satisfaction with them. During the year we have made changes by way of promotion among our chief executive officers. In view of the heavier respon- sibilities thrown upon Mr. Furniss owing to the expansion of our business and the peculiar difficulties of the times, Mr. McKendrick has been appointed deputy general manager, and Mr. Moore and Mr. Voyce have become assistant general managers.

The accounts include the result of our trading during four months of war conditions, but the earlier eight months were not normal, because the threat of war had hung over the world for some time prior to the outbreak, and trade was undoubtedly affected by it. The warnings the world had had of Germany's intentions had en- abled us to make our plans, and when the shock came machinery which had been in readiness was put into motion and quickly had the effect of creating confidence. The conditions ensuing, how- ever, have widely influenced trade; it is therefore gratifying to present accounts such as those before you. We are at the beginning of what may be a long war. The future is obscure, but the bank is in a strong position, ready to meet whatever trials may be ahead.

STRONG LIQUID POSITION

Our net profit is £876,025, an amount slightly in excess of last year. While there has been general expansion in our business, the year's profit has not risen correspondingly, owing to expenses entailed by the war, and the incidence of taxation. There has also been a falling off in the profits from foreign business. A year ago we increased the dividend for the half-year from 7 to 71 per cent. For the interim dividend in July we were able to repeat the 71 per cent. and now feel justified in continuing it for December at the same rate, making 15 per cent, for the year. These two dividends absorb £624,006. From the balance we have applied £5o,00o to published reserve, bringing it to £3,600,000, transferred £aoo,000 to premises redemption, and placed £Ioo,000 to staff pension fund.

In these days it is doubly necessary that we should maintain a liquid position. Our cash in hand and at the Bank of England is no less than £12,475,000, or 11.23 per cent, of our liabilities to the public. Money at call and short notice is £8,530,000, £2,43o,000 more than last year. Total cash items, amounting to £24,727,000, are 22.26 per cent, of our public liabilities, while, with our Treasury bills (£6,255,000, or £2,990,000 in excess of the previous year's figure) and other bills discounted, the ratio is 28.71 per cent. The total of these very liquid items reaches £31,890,000. Further, when the very large amount, £14,398,000, of short term investments is considered, our liquid position is shown to be very strong.

STEADY GROWTH OF FUNDS

Investments are £607,000 up on the year at £34,172,000, a figure considerably below market value. Bank premises and rentable pro- perties, at £2,746,000, are a most valuable asset, and the source of very substantial income. Acceptances, endorsements, &c., at £7,724,000 have fallen off during the year by £473,000, the decrease being mainly due to disturbed international relations.

Deposits have risen to £110,420,000, an increase of £10,380,000. While there was a steady growth in the funds entrusted to us by our customers prior to the outbreak of war, some of the present increment is due to the large government expenditure upon war supplies, and the sale by British investors of their holdings in foreign securities. In due course we shall see a portion of these deposits withdrawn for subscription to war loans; nevertheless, if the last war is any criterion, deposits should continue on the upgrade.

Advances were £46,251,000, as compared with £44,421,000 a year ago. They have been appreciably higher during the twelve months under review, and at one time were over fifty million pounds.

TRADE DEVELOPMENT

Reports from our trading centres all express the difficulty of fore- casting the future under war conditions, but they are unanimous in expecting that there will be great activity. Government control is designed to provide an ample supply of raw material for war needs. as well as to subdue speculation and wide fluctuations in price, and to these ends ordinary trade and independent activities are sub- ordinated, but one day the world will be turning again to peace, Grave difficulties will face us then owing to the dislocation caused by war.

It is vital, therefore, that the trade of the country should be vigorously expanded, and in particular the export side, whereby we largely meet the cost of imports which supply both the sinews of war and our foodstuffs. I spoke 'ast year of the exigency of develop- ing our export trade. The necessity is greater tcday. 'I he insistake of industrialists and trade associations in drawing attention to this most important question, is not only serving the trader's point of view, but also the wider sphere of national interest, which urgently requires the adoption of a definite policy. We are now, more than ever, the world's best customer, and great efforts should be made to ensure that our trade is reciprocal to the fullest extent possible. We can only supply those markets abroad if our prices are com- petitive. With our experience of the harm wrought by the un- profitable contest between rising cost and rising pay, there should be ready acceptance of war-time regulations, rationing, taxation of increased earnings, and, not least, the determination to help to win the war by savings for subscription to Government loans. So far as the bank is concerned, you will wish there should be, apart from the maintenance of strength and security, unstinted service to the needs of the country in any appropriate direction. (Applause.)

The report and accounts were adopted.