BRITISH WAR LOAN PROPOSALS

Dominion, Volume 8, Issue 2496, 24 June 1915, Page 5

BRITISH WAR LOAN PROPOSALS

GREAT FUNDING OPERATIONS INVOLVED CONVERSION OF CONSOLS London, June 22. -The new British loan prospectus shows plainly that only intending holders in tho now war loan will havo the option of converting old loan stock or Consols. Tho Treasury points out that the loan embodies a war loan and great funding operations. It is estimated that £350,000,000 Consols are in the hands of tho public, and it is expected that the holders of £250,000,000 will convert, which will mean the subscription of £330,000,000. Similarly, it is expected that £200,000,000 of the old war loan, will be converted. This will carry a subscription of £210,000,000. Neither war stock nor Consols can be converted unless the holder is prepared to subscribe the ■equivalent market value of the new Stock. The official expectation is that Consols will probably- drop to £57 or £58 by October. The gain to the State will be the wiping out of one-third of the earlier capital indebtedness, if all tho Consols are converted. Though the amount of the loan is not stated, it is not unlimited, as the resolution of the House of Commons confines it to the supply voted for the present vear—that is between £900,000,000 and £1,000,000,000. PRESS AND PUBLIC OPINIONS. London, June "2. The "Financial' Times" fears that, in view of the basis of credit established, some severe readjustments will have to be made in the value of certain Colonial Government and high-class corporation issues. CITY MEN HEARTILY APPROVE. (Rec. June 23, 3.3Q p.m.) London, June 23. The demand for prospectuses is enorInous. City men welcome the scheme as bold, attractive, and clever. The Stock Exchange unanimously approved of the conditions. There are heavy transactions in coniVersions, especially of Consols. Many insurance companies have made largo applications. The Cardiff coal-owners and shipowners havo applied for over a million pounds' worth. The staff of the New South Wales 'Agency-General has agreed to subscribe at least five pounds per head. 'AN INTERESTING EXPERIMENT. (Reo. June 23, 6.10 p.m.) London, June 23. A prominent financier opined that the new war loan was an interesting experiment, which would probably stop all deposits in the Savings Banks, and lead to withdrawals from the Post Office lianks owing to • the superior interest. The idea of touching the small investor has never before been tried, and the Government insured success. The very liberal terms were likelyi to attract foreign capital and to re-establish the rate of exchange. i Trade unionists legard the loan favourably. DISCOUNTING OP TREASURY BILLS fiO FAOILITIATE SUBSCRIPTIONS. London, June 22. ; The Chancellor (Mr. M'Kenna), in •'the House of Commons, said that the Bank of England was prepared to rediscount Treasury bills, to enable holders to subscribe to the new loan. He says that tho Government will not he disappointed if it gets £600,000,000 i»f new money.