MR LAKE’S COMMENT

Press, Volume C, Issue 29518, 20 May 1961, Page 10

MR LAKE’S COMMENT

“Significance Not Great”

(N.Z. Press Association) WELLINGTON, May 19. The fact that New Zealand's £2om loan in London was substantially taken up by the underwriters was not of great significance, the Minister of Finance (Mr Lake) said tonight. "The main thing is that it was successfully underwritten.” he said. “A similar situation faced the Minister of Finance in the Labour Government in 1958 when the £2om th?n raised was substantially taken up by underwriters on the initial offering." Mr Lake said. “It is quite common in London for a large issue such as that just offered by New Zealand to be underwritten. The terms are usually decided by the assessment by the underwriters of the ability of the market to absorb so much stock in a comparatively short time. “The fact that the underwriters accepted the risk on the terms negotiated indicated they were satisfied with the New Zealand proposition and would be able to place within a reasonable time any of the loan which they might have to take up. “The loan will secure to New Zealand £2om spread over three months as subscription is.by instalments. It will provide a welcome addition to the, at present, inadequate external reserves.” Mr Lake said.