COMPANY MEETING
NATIONAL BANK OF SCOTLAND
PROFITS WELL MAINTAINED
THE 115th annual general meeting of the NatioLal Bank of Scotland, Limited, was held at the bank's head office on December 19th.
The Most Honourable the Marquess of Zetland, P.C., G.C.S.I., G.C.I.E. (governor of the bank), in the course of his speech, said I wish to give expression to the deep regret ot the directors occa- sioned by the sudden death of the Marquess of Lothian, who will be well remembered as Governor of the Bank for some few years until obliged to relinquish the office on appointment as Ambassador in Washington. I would also refer to the death ot Lord Abertay and of Mr. Charles Ker, LL.D., D.L., who had been a member of the board for many years.
The period covered by the accounts in your hands embraces a full twelve months of the war in which our country and Empire are so vitally engaged, and the results have been affected by the increased taxation which it has been necessary to impose towards meeting the colossal war expenditure. This greater tax upon our revenue has been to a considerable extent offset by the larger resources at our disposal and the more extensive business passing through our hands, and the profits have been well maintained at £279,434, only some £3,000 less than those of the previous year, results which in the opinion of your directors are very satisfactory.
ThE DIVIDENDS
They recommend that dividends be now declared at the rate of 16 per cent. per annum on the Consolidated Capital Stock and at the rate of 5 per cent. per annum on the " A " Stock, which is held by the public, absorbing, less tax, £112,700, and that the balance of £88,097 be carried forward to the present year's accounts.
A noteworthy feature in the balance-sheet itself is the high figure reached by the notes of the bank in circulation, which stood on November 1st at £4,190,678, an increase of approximately £9oo,00o over the figures of a year ago. Hen is unmistakable evidence of the extent to which Scottish industry is expanding its output and devoting its energies to the nation's war effort. The deposits like- wise show the substantial increase of fully £4,000,000 and stand also at the highest figure in the bank's history, namely, £41,959,000, not- withstanding the substantial support accorded by our customers to Government loans and War Savings schemes. Acceptances, endorse- ments and other obligations on account of clients are higher by £500,000 at £2,851,000.
It has long been the custom at these meetings to offer some review of the state of trade and industry at home and overseas. but in present circumstances our consideration of business conditions must inevitably follow different lines. An examination of the causes of the general decline in banking advances reveals some of the effects of the war upon the normal peace-time activities of the country, but it may be mentioned that the Government is making use of the resources of the banks to help in financing the war by borrowing from them on Treasury deposit receipts, which accounts for the new item under that name appearing in the balance-sheet.
EXCESS PROFITS TAX There are ample indications that industry is at present fully occu- pied, largely no doubt with war work; but I am not so sure that adequate thou_u is yet being given to the conditions which will be likely to prevail when the flow of war orders comes to an end and the inevitable problems of the post-war period have to be faced. Little forethought is required to bring home to us the supreme importance of every branch of industry being thoroughly equipped when that time comes, both technically and financially, to cope with the difficulties that are bound to arise in connection with the change- over from war-time to peace-time conditions; and it seems to me open to question whether the nature of these problems has been fully borne in mind by those who have had the responsibility of devising various measures of taxation and I entertain the gravest doubts whether in the case of the Excess Profits Tax the Government's second thoughts were best. If Excess Profits Tax is to continue to be levied at zoo per cent., how are our industries to be able to re- place machinery and equipment worn out by the continued pressure of output during the war? Some concession is surely called for in fairness to the large number of cases where businesses were only a year or two ago emerging from the period of depression and have such a low standard of profit, if any at all, that they will be deprived of practically the whole of the profits which they have for years struggled to earn. New enter- prise is likewise unduly and inequitably penalised. The small per- centage of revenue which would be involved in this modification of the zoo per cent. tax would be more than compensated by thus placing industry on a footing to tackle post-war problems.
STAFF
There are now 318 members of our staff serving with the Forces, and already 3 have lost their lives in their country's cause. Their families and relatives have our sincere sympathy. No fewer than 13 of our staff are prisoners in enemy hands, and our thoughts often turn to them in their plight. The large number of women who have joined our ranks temporarily to fill the places of men on active service are giving a good account of themselves. The directors wish to convey to the permanent staff who are still with us their high appreciation of the good work they have done and continue to do during longer hours and under more difficult conditions than in nor nal times.
The report was unanimously adopted.
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