COMPANY r5EET1NG
CHARTERED BANK OF INDIA, AUSTRALIA AND CHINA
FURTHER EXPANSION OF BUSINESS PROBLEMS OF EXCHANGE AND TRADE CONTROL THE following is the statement by the Chairman (Mr. Vincent A. Grantham), which is to be submitted at the eighty-seventh ordinary general meeting of the Chartered Bank of India, Australia and China, to be held on April 2nd: As war-time conditions may make it difficult for shareholders to attend our annual meeting, I have decided to give them the informa- tion regarding the past year's working of the Chartered Bank to which they are entitled in the form of this printed statement which is being sent to them with the balance-sheet.
This statement will take the place of the address usually made by the chairman, and subsequently circulated in print; the proceedings at the annual meeting—which will take place on April 2nd—will be con- fined to the necessary resolutions to be submitted to the shareholders present, though there will, of course, be no curtailment at the meet- ing of the rights of shareholders to obtain such further information as they may require.
BALANCE-SHEET FIGURES
Turning to the balance-sheet itself, I am glad to say that it con- tinues to show further expansion, the total of £76,114,228 being £8,545,431 higher than that of last year, and the highest in the history of the bank. It also reflects very strikingly the effect of the war, for you will find that our current and other accounts, repayable on demand, again show a large increase of £13,687,102 and stand at £53,378,931. On the other hand, fixed deposits show a decline of £1,844,115, and these two movements indicate the degree to which our clients have been keeping their resources liquid. Bills payable at £855,833, against £3,605,836 a year ago, show a considerable decrease, but the smallness of the figure is due to our not having received up-to- date mail information. The apparent decrease is not a real one.
CONTRIBUTION TO THE WAR EFFORT
On the other side of the balance-sheet the first item of cash in hand, &c., at £11,578,517, as compared with £6,859,010 last year, shows a sharp increase, but I do not think this figure will be con- sidered excessive. This item is, of course, not interest earning but liquidity in these days must be our first consideration. We have, of course, contributed to the utmost of our ability towards the finance of the war, and the increase in Government and other securities from £20,624,407 to £27,721,766 wholly represents subscriptions to War Loans at home and abroad. Our holdings are largely of a short- dated character. Bills of exchange, including Treasury bills at £7,721,155, show a substantial decrease, but if to this be added the balance of head office and inter-branch remittances, drafts, .&c., in transit amounting to £5,454,351, and I am confident that bills in transit considerably exceed this figure, the true figure for bills of exchange would show an increase as compared with that of last year. The only other figure showing substantial change is bills discounted and loans, which at £20,640,936 compares with £24,9673792. This is partly explained by the further fall in the sterling value of the Chinese dollar, but, in common with many other banks, our clients have not needed to use the facilities we place at their disposal to the same extent as in normal times.
PROFIT AND DIVIDEND
I now come to the profit and loss account, and I am glad to say the result is better than in either of the previous two years. The figure is L400,159 15s. rod., and we are fortunate in not having had to provide this year for depreciation on securities and other excep- tional items. Needless to say, all necessary provisions have been made, as well as those for taxation, both at home and abroad, and in these days this item of taxation is particularly heavy. Many of our branches bear local taxation, for which we do not obtain any relief when computing our liability to British taxation, so that some of our profits are in a sense doubly taxed.
The interim dividend paid last October absorbed Li sopoo, and it is proposed to pay a final dividend of it) per cent. per annum for the half-year to December 31st last, costing a further £15o,000, to transfer £50,000 to the officers' pension fund, to write off premises account L50,000, and to carry forward the balance of £182,602 9s. ild.
CHINA AND JAPAN
Japan's internal economy continues to be dominated by the immense burden of providing finance for her military requirements. This pre- occupation, with all its far-reaching consequences and her continued involvement in the war in China, is hindering her ability to benefit from the greatly increased opportunities for peaceful trading, which, due to the absorption of other great trading nations in the struggle in Europe, would have been hers had normal relations with the outside world been maintained.
Ftrrung PROSPECTS
We have made full provision for every contingency up to date, and if adverse circumstances should arise at any particular point the shareholders may rest assured that every step has been taken in advance to minimise the effect of such circumstances. We are fortu- nate in having a strong balance-sheet, and we may reasonably expect our business to stand up to any strain that may be put upon it.
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