£20m Loan Sought On London Market

Press, Volume C, Issue 29514, 16 May 1961, Page 14

£20m Loan Sought On London Market

Out Own tteportei)

WELLINGTON, May 15. A loan of £2om. is being sought by the New Zealand Government in London this week. It has been underwritten and is expected to be on the market on Thursday. The loan will have an interest rate of 6 per cent, and will be issued at £9B 10s. It will be for a term of 11 years and a half with maturity date on November 15, 1972. Gross redemption on the loan is thus £6 3s 8d per cent.

This information was given this afternoon by the Minister of Finance (Mr Lake), who said: “In view of the present relatively low state of our overseas reserves, it was necessary to seek the permission of the United Kingdom Government for borrowing £2om. in London, where there is already a heavy demand for loan moneys. “The normal flow of our trade usually results in a build-up of overseas funds in the first half of the year with a drawing down of the funds in the second half. This year, however, largely through a greater than normal increase in private imports, our external reserves have remained almost stationary in recent months. “This loan will assist in preventing further decline of those reserves, whilst the Government’s measures to reduce the level of imports gradually take effect,” Mr Lake said.