26 NOVEMBER 1937, Page 41



MR. S. M. WARD'S REVIEW THE forty-fifth ordinary general meeting of the English, Scottish and Australian Bank, Ltd., was held on November 24th, at 5 Grace- church Street, London, E.C.

Mr. S. M. Ward, the Chairman, in the course of his speech, said : You will, I am sure, have all heard with deep regret of the death on October 25th last of our revered chairman, Mr. Andrew Williamson. We have lost a great chairman who has guided the fortunes of this bank with conspicuous success for the last 17 years, and, above all, we have lost an old and valued friend. I am sure I shall be acting in accordance with your wishes in conveying to Mrs. Williamson your appreciation of the great services her husband has rendered to the bank, and your sincere sympathy with her and her family in the great loss they have sustained. (Hear, hear.)


Passing now to a short review of the past year, it is pleasing to be able to report that the Commonwealth is enjoying a period of remarkable prosperity. The Federal Election, which has recently taken place, has resulted in the return of the late Government to power, with a slightly reduced majority. The outcome is a record in Australian political history, for this is the first occasion on which the same Government has entered upon a third successive term of office a -result which is a high tribute to the popularity and leadership of Mr. Lyons, the Prime Minister. Apart from the spirit of confidence engendered by a stable Government, upon which the ultimate welfare of every nation depends, the factors contributing to prosperity in Australia are mainly the volume and prices of her export commodities. Australia lives by her exports, and of those by far the largest are wool and wheat, which together represent nearly 69 per cent. of her total exports.

With the single exception of butter, the value of every item in the classified list of exports shows an increase, and the total exports amounted to £127,000,000 sterling as against £109,00o,00o in 1935-36 and £85,0oo,000 in 193D-32, which was the worst year of the depression.


During the period under review wool production exceeded esti- mates by 200,000 bales, while at the same time the demand continued keen and was at times difficult to satisfy. Under these favourable circumstances prices remained firm, and the average market value for greasy wool was 16.48d. compared with 14.ord. per lb. for 1935-36. The value of wool exported amounted to £A62,526,000 against £A51,768,000 for 1935-36.

At the moment a general setback of prices has manifested itself, due almost entirely to a lack of confidence in the European situation, the unsettled conditions in the Far East and the possibilities of reaction from the American position.

The quantity of wheat exported was somewhat lower than in the preceding year, but the higher world price more than com- pensated for this falling off, and the official statistician of the Com- monwealth gives the value of the exported wheat and flour as £A24,361,000, compared with £A18,57o,00o for the year 1935-36.

The present pric:. level is attractive to growers as is evidenced in the wider areas sown to crop by all chief producing countries, but it should be some time before world production is stimulated sufficiently to reverse the present trend of the market. The Australian crop estimates for the current season were put as high as 190 million bushels, but owing to some unfavourable weather reports from Victoria and New South Wales this figure was modified later to round about 160 million bushels, compared with 150.5 million bushels last year.


A further decline in butter exports of 17,025 tons below the already reduced level of the previous year has to be recorded but Australia still stands third in the list of suppliers to this country with 29 per cent. of the total imports from Empire sources. The reason for the decline was due to the dry weather in the dairying districts of New South Wales and Queensland in the spring and early summer. The total value of butter exported was £A7,716,473 against £A9,832,733 in 1935-36.

One of the essential factors of the meat market of this country is the policy of the British Government, by which each of the ex-

porting countries is necessarily affected. So far as mutton and lamb are concerned. there is a continuance of the policy of regu- lating supply to demand and arranging shipments from the Dominions accordingly.

Australia continues to make progress in the export of chilled beef and it is anticipated that shipments of beef from Australia to the United Kingdom will be approximately 33 per cent. more in 5937 than in 1936. So far as the Dominions are concerned, the British Government have, we understand, agreed to the right of producers to change over from frozen to chilled beef to any extent desired within the quota, and with the improvement of gas storage and transport facilities, Australia is rapidly increasing her volume of chilled beef without involving any reduction in frozen shipments.

Maras s.

The upward trend in prices recorded in 1936 continued until the peak of March this year, since when they have fallen rapidly. The value of all non-ferrous minerals exported, including coal and excluding gold, last year was £A9,600p0o, an increase of £A19o,o0o over the preceding year.

During 1936 gold production of Australia amounted to 1,169,301 fine ounces, worth £A1o,121,313, being an increase of some 254,6o0 fine ounces over that of 1935. During the last seven months of the year production exceeded roo,000 ounces per month, and in December, 1936, reached the record figure of 123,411 ounces.

It is natural that a large proportion of the increase in the value of exports referred to above should find its way back to Australia in the form of imports, which rose from £85,000,000 sterling to £90,500,000, while the excess of exports over imports rose from £23,600,000 to £36,3oo,000, and after allowing for the requirements of the Federal Government to meet their sterling obligations for debt services—together with interest on Municipal Loans—now approximately £24,000,000, the balance would indicate the strengthening for the time being of the London Funds held by the Commonwealth Bank and the Trading Banks.


A pleasing result of the present recovery in Australia is the large measure of improvement in the unemployment situation. It was stated by the Treasurer of the Commonwealth, the Hon. R. G. Casey, in his Budget Speech in August last, that the value of the recorded material production in the Commonwealth had risen, from £A3o5,000,000 in 1931-2 to LA432,000,000 in 1936-7, with the result as stated by the Commonwealth Statistician that the volume of unemployment in reporting Trades Unions had fallen from 3o per cent. to 9.7 per cent. in the same period. The building trade is one which is always peculiarly .sensitive to prosperity or depression, and it is significant to note that according to official estimates building and construction in the whole of Australia has increased from a little over £A8,000,000 in the depression period of 1930-I to the high figure of £A43,000,000 for 1936-37.

Those of us who have been long in business know only too well that good times do not last for ever and the wise man is he who in times of prosperity like the present seizes the opportunity to make provision against the lean years which, sooner or later, are sure to come.

With regard to the immediate future, however, the outlook con- tinues generally favourable. This is borne out by the following telegram which we have just received from our General Manager : " Conditions in Australia on the whole gratifying recent rains in important districts have assured satisfactory summer season dairying prospects good estimated wheat harvest heavier than last year and prices expected to be reasonable wool prices have fallen and market tendency obscure metals have fluctuated recently but there appears to be a steadier tone in the market trading conditions continue buoyant and general prospects are satisfactory."

With reference to the Banking Commission, the Chairman, in expressing approval of the general conclusions of the report and its endorsement of private enterprise in banking, said that with regard to the recommendations of that report, about 3o in number, there were some to which the bank would take strong exception in their present form, especially as they appeared to be inconsistent with the body of the report. The report, however, was doubtless receiving careful and exhaustive examination by the Government.


Continuing, he said : Passin3 now to the accounts, deposits at interest have increased £1,227,280, and current account credit balances have increased £1,162,129 ; taking deposits and current accounts together at £35,282,660, there is the substantial increase of £2,389,410 over last year's figures. Our cash items at £11,324,779 show an increase of £2,912,565, while our investments, consisting of British and Dominion Government securities have increased by £720,944. The ratio of cash to each £ of our current account deposits is 15s. cid., and if we take into account the Treasury Bills which we carry in the balance-sheet under the heading of bills receivable, and which are discountable by the Commonwealth Bank, the ratio is 17s. 9d. per £ of our demand liabilities. The gross profit was £1,181,48o, an increase of £78,766, and it was proposed to pay a final dividend of 3i per cent., less United Kingdom Income Tax, making 7 per cent. for the year.

The report and accounts were unanimously adopted.