A circular to proprietors of the Bank of Scotland also
contains proposals for a new issue of stock, a feature of the arrangements being the elimination of the unpaid capital of the whole of the issued stock. Assuming the proposals to be accepted, the paid-up capital of the bank will be raised from £1,500,000 to £2,400,000. First of all there will be an issue of £150,000 stock, to be paid up to the extent of £100,000, raising the paid-up capital to £1,600,000. The new stock will then be offered to proprietors at £440 for each £ioo of paid-up capital and it will be allocated in the proportion, as near as possible, of £t of stock (paid-up to the extent of 13s. 4d.) for every complete amount of £15 of stock now held and paid-up to the extent of £m. The premium on the new issue (£340,000) will be added to the published reserve, raising it to £2,690,00o, while it is proposed to transfer £n0,000 from the existing balance of profits carried forward, so that the reserve will then stand at £2,80o,000. This being done, the proprietors will apply £800,00o to the reserve in cancellation of the uncalled capital and the new position of the bank will then be that it will have an issued and paid-up capital of £2,400,000 and a reserve of £2,000,000, with a balance brought forward of £145,995. The total Reserve Fund, paid-up capital and balance brought forward will then aggregate £4,546,000. Inasmuch as the dividend paid has, for the past ten years, been at the rate of 18 per cent., less tax, the new stock will give a yield, at the proposed issue price, of just under £4 2S. per cent. A further interesting point in connexion with the scheme is the application to be made for an official quotation of the stock on the London Stock Exchange. The whole scheme has been well thought out and, among other things, the marketability of the stock should be materially increased.
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