Name of Company Office Appointed Canadian General Securities. . V.P. & Gen. Mgr.. Rt. Hon. Arthur Meighen.. Dominion Bank.. Bank of Montreal.. Address Toronto London, Eng. Laurentide Co... Canadian Bank of Commerce. Canada Trust Company. Canada Bread Company Bank of Montreal.. Bank of Nova Scotia. Maple Leaf Milling Co...... Mgr. Montreal Br. P. C. Stevenson.. Director. Vice-President. Director.. Director. Director. " Asst. Gen. Mgr. in .. Asst. Mgr. Head John A. Northway.. . Herbert E. Gates.. Lt. Col. Harry Cockshutt Albert E. Matthews. Haliburton Weldon. Mark Bredin.. Montreal Ottawa . London The Canadian Stock Exchanges. The year 1926 easily exceeded in activity the previous year, which itself had created a new high record in the volume of sales in the history of the Canadian Stock Exchanges. The Montreal Stock Exchange had transactions in listed stocks covering a total of 6,751,570 shares. The previous record, established in 1925, had been 4,316,636, and prior to that the year 1920 had established the largest total, 4,177,962 shares. Thus the gain in 1926 was over 50 per cent. as compared with the greatest activity in stock exchange transactions that had ever before been experienced. The most active stock on the Montreal board was the common stock of Brazilian Traction Light & Power Company, which provided more than 25 per cent. of the total, with 1,857,259 shares. The second in order, with considerably less than one-half this total, was Consolidated Mining & Smelting Company, with 753,578 shares. Canadian Industrial Alcohol was third with 455,236 shares, and Laurentide Company fourth with 415,514. Other highly active securities were those of Abitibi Power & Paper Company, with 252,991 shares; Asbestos Corporation common, 113,834; Brompton Pulp & Paper, 146,701; Canada Steamship Lines preferred, 197,312; Montreal Light, Heat & Power Consolidated, 221,202 shares of the old stock, and 317,780 of the new no-par value stock; National Breweries, 345,575; and Winnipeg Electric, 129,262. According to The Gazette, Montreal, 159 listed stocks made their appearance. Of these 92 closed the year with net gains ranging up to 100 points, while only 47 stocks lost ground. That the movement preponderated in gains is indicated by the fact that 23 issues gained 20 points or more, while only nine exceeded 10 points of a decline. This point was further illustrated by The Financial Times, Montreal, which estimated that 50 stocks during the year showed an increase in market valuation of $176,613,693, or an average of about $3,500,000 each, while 15 that registered declines lost only $15,206,032 in value, or an average of $1,000,000 for each stock. This left the net gain on 65 stocks of $161,407,661. Of the 50 stocks the aggregate advance shown was 1,0783% points, or an average of 211⁄2 points for each security, while the 15 stocks declined only 1144 points, an average of 72 points. Shawinigan Water & Power Company led in gains with an advance of 99 points in its capital stock, from 169 to 268. The next in gains was that of Quebec Power Company, a subsidiary, whose common stock was up 861⁄2 points and the preferred 82 points. Consolidated Mining & Smelting Co. was fourth, with a price appreciation of 70 points, from 182 to 252. Montreal Power was fifth, with a gain of 42% points; Ogilvie common up 40 points; Canadian Oil Companies common, 37; Wayagamack and Canada Steamship Lines preferred, 35 points; Wabasso Cotton Co., 34; Dominion Coal preferred, 31; Canada Bread common, 30. Among the declines were Lake of the Woods common, 22 points; Twin City common, 16; Canadian Salt, 13; Canadian Connecticut Cottons preferred, 122; B. E. Steel 1st preferred, 102. The leader during 1926 in the increase in market valuation was Consolidated Mining & Smelting Company's gain of $35,490,840, a total that must be added to the appreciation in market value during 1925 of $67,027,458, a total gain for the two years of over $102,000,000. Montreal Power, as in the previous year, stood second to "Smelters," with an increase of $27,248,093, which with the 1925 gain of $41,933,080, made a total appreciation for the two years of over $69,000,000. Shawinigan was up $22,770,000 and Brazilian Traction, $20,915,540. Thus the four leaders represented market gains exceeding $111,000,000, or nearly 70 per cent. of the total. Other securities that showed impressive advances were those of Canadian Industrial Alcohol, with $9,600,666; Laurentide Company, $6,192,000; and Abitibi Power & Paper Company, $5,250,000. Among the losses exceeding $1,000,000 each were British Empire Steel 1st preferred, $4,014,500; Twin City common, $3,630,000, and Mackay common, $3,103,530. The following is the record of sales on the Montreal Stock Exchange for the past eight years in number of shares: 1920 1919 3,865,683 4,177,962 1921 1922 1923 1924 1925 1926 2,068,613 2,910,878 2,091,002 2,886,603 4,316,636 6,751,570 In a review of stock exchange values in 1926 Professor H. Michell, McMaster University, Toronto, declared that the year was remarkable in having seen stocks reach their highest recorded level. "The average of 30 common industrial stocks stood at 124.4 on the last day of December, 1925, and at 138.3 in December, 1923. Since August, 1921, when they stood at 73.1, they have advanced over 96 per cent., or practically doubled in value. Carrying back the record still further they are now 23.6 per cent. in advance of the previous high record of November, 1919, when the average stood at 111.8. Going back 18 years to 1909, the average has slightly more than trebled, it having stood at 44.8 in January of that year. ... The recessions of March and April (1926) although quite violent, soon gave way to another strong upward movement, which carried it up to September. A setback followed in October, which was far less pronounced in Canada than in the United States. In November occurred a very strong resumption of the rise." The mining markets during 1926 followed the course of the stock exchanges in showing substantial advances. Eleven of the leading issues rose over $55,000,000 during the year. The leader was Hollinger Consolidated Gold Mines, with an advance of $2.90 per share on the 4,920,000 shares, representing a gain of $14,268,000. Lake Shore advanced $6.10 per share, showing an aggregate gain of $12,200,000 on the 2,000,000 shares outstanding. Teck-Hughes rose $13,983,955, more than doubling its market value from $11,887,979, to $25,871,934. Noranda advanced from $19,836,900 at the end of 1925, to $34,056,900 at the end of 1926, a gain of $14,220,000. Amulet more than doubled its market valuation by an advance of $4,410,000; Wright-Hargreaves was up $5,637,500. The only substantial decline was shown by Dome Mines, which dropped $7,121,227, the market valuation of its stock declining from $16,750,000 to $9,628,773 during the year. Premier Mine dropped from $11,150,000 to $9,600,000, a decline of $1,550,000. Changes in Capital Stock and in Dividend Payments during 1926. The following is a record of changes in capitalization and in dividends in connection with securities listed on the Montreal and Toronto Stock Exchanges during 1926, as compiled by Financial Counsel: British-American Oil.-Capital stock split, old $25 par shares being exchanged for four new no-par shares each. Loblaw Groceterias.-Old common split two for one and new placed on $1 annual dividend basis. Massey-Harris Company.-Holders of 241,798 shares of old capital stock received one new preferred and one new common for each two shares held. In 1927 new common stock split four-for-one. Montreal L. H. & P. Consolidated.-Old capital stock converted into one new share of $50 par 6 per cent. preferred, and three shares new no-par common. Preferred later redeemed at par, making split virtually three-for-one, with bonus of $50. New common placed on $2 dividend basis. King Edward Hotel Company.-$100 par common split four-for-one into no-par stock. Shawinigan W. & P. Co.-Old $100 par capital stock changed to no-par on four-for-one basis. Shredded Wheat Company.-Old stock split four-for-one into new no-par, with $3 dividend rate. Wayagamack P. & P. Co.-$100 par shares exchanged into new no-par at 2 for 1. Western Canada Flour Mills.-Old 28,750 shares of $100 par changed into 30,000 shares 61⁄2 per cent. cumulative preferred and 150,000 shares no-par common, old holders receiving $60 par value of preferred and three shares of new common for each old share. Canadian Industrial Alcohol.-Bonus of 20 per cent. new stock, increasing capital from 800,000 to 969,480 shares. Atlantic Sugar Refineries.-$100 par common changed to no-par and amount of common increased by 30,000 shares, which was offered to shareholders at $25 a share on basis of one-for-two. Bird & Son, Inc.-8 per cent. cumulative preferred redeemed at 110 and accrued dividend. Canada Steamship Lines.-Old 7 per cent. preferred replaced by new 6 per cent. preferred and arrears of preferred dividends up to December 31, 1926, liquidated by issue of $2,500,000 of additional 6 per cent. preferred, increasing amount outstanding from $12,500,000 to $15,000,000; common stock of $100 par changed to no-par. Preferred made callable at $125 and participating with common on basis of receiving 7 per cent. if common pays $3 or under per share, and to 8 per cent. if common dividend exceeds $3. East Kootenay Power.-Increase authorized of 7 per cent. cumulative preferred from $750,000 to $5,000,000 and common from 30,000 to 50,000 shares, no-par. McColl Bros.-In August, 1926, company reorganized, with issue of $1,000,000 s. f. cumulative preferred; 90,000 shares no-par common issued; preferred holders having right to exchange on basis of three-for-one. Preferred stock called in June, 1927, at 1072. Montreal Tramways Company.-Shareholders given right to subscribe to 10,000 additional shares capital stock at $125, on basis of one-for-five. Mount Royal Hotel.-Preferred dividend arrears of 28 per cent. to end of 1926, liquidated by payment of $3 in cash and 25 per cent. in new redeemable scrip; dividend on preferred reduced from 8 per cent. to 6 per cent. and payment inaugurated; common changed from $100 par to no-par. Page-Hersey Tubes, Ltd.-Old company reorganized with new preferred and no-par common; former at 7 per cent. and latter at $3 dividend basis. Port Alfred P. & P. Co.-Preferred increased from $4,000,000 to $6,000,000 and common stock doubled through issue of 60,000 shares of no-par at $25 per share. Provincial Bank.-Paid-up Capital increased to $4,000,000 by issue of $1,000,000 to shareholders at 120. Quebec Power Co.-Preferred stock offered retirement at 110, with privilege of securing common share for share at same price; authorized common capital increased to $15,000,000. Royal Bank of Canada.-Issue of $5,600,000 additional stock announced, increasing paid-up capital from $24,400,000 to $30,000,000, with new stock offered to shareholders at $200 per share, on basis of about one-for-five. St. Maurice Valley Corp.-New issue of $1,200,000 preferred, increasing total to $8,000,000; increase in authorized common from 150,000 to 500,000 shares of no-par. Western Grocers Co.-Preferred shareholders for each two shares received one of new preferred and one of new common, with $5 in cash, while holder of old common, for each six shares, received one of new. Winnipeg Electric Co.-Increase in authorized preferred from $3,000,000 to $10,000,000. Wabasso Cotton Co.-Authorized capital stock increased from 35,000 no-par to 105,000 no-par shares, and outstanding stock increased from 35,000 to 52,500, new stock being offered to shareholders at $60 per share in ratio of one-for-two. Other Dividend Changes. British American Oil, bonus of 50 cents a share; Consolidated Mining & Smelting Company, bonus of $3 for first half and $5 for second half, and regular dividends of 8 per cent. (an increase of 2 per cent.), making total disbursement $10 per share compared with $6.50 previous year; Dominion Bridge, bonus of 2 per cent.; Dominion Engineering, payment of 6 per cent. in two instalments; Imperial Oil, bonus of 25 cents; Ogilvie Flour Mills, bonus of $5; Ontario Steel Products, bonus of 1 per cent.; Ottawa Traction, bonus of 1 per cent.; Penmans, bonus of 2 per cent.; Provincial Paper Mills, bonus of 1 per cent.; Wabasso Cotton Co., bonus of 50 cents a share; Abitibi Power & Paper Co. common stock placed on $5 basis; Brazilian Traction L. & P. Co. raised from 5 to 6 per cent.; Brompton P. & P. Co. common placed on $2 basis; Canada Bread common (new) placed on initial $5 basis; Christie, Brown & Co., initial dividend at rate of $1.20; Montreal L. H. & Power Consolidated, new no-par stock placed on $2 basis; McColl Bros. & Co., initial rate of 80 cents; Mount Royal Hotel Co., 6 per cent rate on preferred; Northern Mexico Power & Development, preferred on regular 7 per cent. basis and initial dividend of $1 on common; Port Hope Sanitary, common dividends initiated at 3 per cent. rate; Porto Rico Railways, common resumed at 4 per cent.; Quebec Power Company, common dividend increased to 6 per cent. and later to 7 per cent.; Wayagamack P. & P. initial dividend on new common at $3 rate; Western Canada Flour Mills, initial dividend rate at $1.40. Commercial Failures in Canada. Commercial failures continued to show an improvement during 1926, bringing an unbroken record of betterments from 1922 to the end of 1926. The total number, as reported by R. G. Dun & Company, was 2,196 as compared with 2,371 for 1925; 2,474 for 1924; 3,247 for 1923, and 3,695 for 1922, a decline of just under 1,500 in the four years. The amount of liabilities also continued in a descending scale, showing a decline of nearly $8,700,000, compared with the 1925 total, and being considerably less than one-half the total of 1922. The record of liabilities for the past five years has been as follows: 1926, $37,082,882; 1925, $45,767,825; 1924, $64,530,975; 1923, $65,810,382; and 1922, $78,068,959. The number of failures among manufacturers showed the same steady decline: 527 as against 563 for 1925; 625 for 1924; 792 for 1923, and 857 for 1922. Trading failures were 1,548 as against 1,693 for 1925; 1,720 for 1924; 2,319 for 1923, and 2,717 for 1922. Financial Incidents. A rather notable case came before the Canadian courts in 1926. Joseph Xavier Hearst, a promoter, who was President, Manager and Treasurer of Hearst Music Publishers, Limited, of Winnipeg, was sentenced to seven years in the penitentiary on being found guilty of making false entries, making false statements, theft and false pretences. The case came up in connection with the floatation of shares of the Hearst Company, capitalized at $1,000,000. At Ottawa, Hon. Dr. J. W. Edwards, M.P., unsuccessfully sought to have the House concur in a resolution he proposed that the same measure of relief be granted those who suffered loss through the failure of the Farmers' Bank as had been granted to those who lost through the Home Bank failure. A group of Canadians, prominent in financial and industrial circles, secured control of Canadian Vickers, Limited, from the English parent company. The group included James Playfair, James Richardson, Frank Ross, Noah A. Timmins, Victor Drury and Senator Donat Raymond. The Financial Post Toronto, estimated in its issue of April 1st, 1927, that Canadian Trust Companies had over one billion dollars of estates under administration, the total on Dec. 31, 1926, being $1,046,117,537, as compared with $978,223,929 at the end of 1925. Canadian Pacific Railway shareholders in May, 1927, authorized an issue of $75,000,000 of new common stock at such times and under such terms as the directors should decide-an increase from $260,000,000 to $335,000,000. The Banking and Currency Committee of the Canadian Council of Agriculture urged sweeping changes in the Canadian Bank Act, one of which was permission for the establishment of local banks with a capitalization of $35,000, and the inauguration of a national bank similar to the Federal Reserve Bank of the United States. The memorandum which formed the report of the Committee was the work of A. E. Darby, of the Economic Research Department of the Council. Mr. Darby disarms criticism of radical intentions by stating in his first paragraph that "the deliberate adoption of any new and revolutionary system of banking need not be anticipated." At the Annual Meeting of the Dominion Mortgage and Investments Association at Edmonton on Sept. 20 and 21, 1926, George H. Smith, the President, expressed the opinion that "the last thing the Western farmer needs is more credit." In dealing with proposals for Rural Credits, Mr. Smith declared that "if further Government systems be set up, the old-established lending instittions, which have fully provided the credit required since many years prior to Confederation, are quite satisfied they can compete in rates of interest as well as in all other respects, provided they be given fair play." A keen struggle took place between the Montreal civic authorities and the Montreal Board of Trade early in 1927, over the purchase by the City of the Montreal Water & Power Co. at a price between $4,000,000 and $4,500,000 above what had been paid a few months previously by a syndicate (on a basis then of $85 a share). The Board of Trade finally succeeded in blocking arbitration proceedings, and the city thereupon voted to hand over the property again to the group concerned in the negotiations. The case involved court proceedings, a libel suit against The Standard, Montreal, and appeals to the Provincial Premier to intervene. The chief objection raised by the Board of Trade was that the price to be paid was excessive, and provided an undue profit to the syndicate concerned. INSURANCE IN CANADA IN 1926 The writing of Life insurance in Canada continued to show new high records year after year, and the year 1926 proved no exception. According to preliminary figures issued by the Superintendent of Insurance, G. D. Finlayson, the growth of new business in Canada during the year was $797,940,009, a new high record for a single year, and running nearly $86,000,000 ahead of the total for 1925, which itself had created a new record, exceeding the previous high of $641,778,095 established in 1920. The increase of 1926 over 1925 represents about 122 per cent. The gain in 1926 brought the total amount of insurance in force in Canada to $4,609,902,248, a net gain of more than $115,000,000 over the total at the end of 1925, which stood at $4,159,019,848, and $846,000,000 ahead of the 1924 total of $3,763,996,472. Several features stand forth in the impressive results achieved in 1926. One is the remarkable growth from a comparative standpoint in the writing of life insurance in recent years. As compared with the 1926 total of life business in force, there was just over $100,000,000, or one-forty-sixth in 1881, 45 years ago. During 1888 the total passed $200,000,000; four years later, 1902, the aggregate was $508,000,000. In 1912 the total exceeded one billion dollars ($1,000,000,000) for the first time; the two |