Five Million Loan

Hokitika Guardian, 16 June 1922, Page 4

Five Million Loan

EFFECT ON HOME SECURITIES-

\ve; UXG lON. June' Tl

British pa, ors hr the last mail disclose the efi'e. t tic placing of the New Zealand loan i u the market in April had upon l.onth n finance generally. The terms of the b an, 5 per cent, at par being more favourable to the borrowers than the British war loan, revolutionised the maiic t, the result Being that the British war loan immediately rCse to 101 and 102. M: anwhilo, however- the New Zeal'till Bum had been heavily ovcr-suhsi'rib-'d. and then investors who had been i liable to get the New Zealand stock turned to British war hums, the New Zealand loan a

day or two after this floatation being quoted at one-eighth per cent, below pur. indicating that the loan was limited on the best tonus possible. The Press was unanimous as to the value of the New Zealand security, and the confidence, of the public in the investment. Some comments are:

“Daily Mail”:—“The issue of a Dominion loan yielding as low a rate as

.5 per cent, makes a new stage In tlip cheapening of money, and it is agreed j in the-city that if a Dominion issue ■ ran be arranged on this basis, the Tin- j j cianl Bovei ninent’s 5 per cents, ought tn fie worth morn than 100. Hence the r, percent, war loan was especially firm, rising to a new high record of 101.” "Financial Times” : “A cause contributing to the rise was the underwriting of a fresh loan for New Zealand on terms which by comparison made the .5 per cent, war lean look relatively cheap.” “Evening News" : “The sharp rise in the -5 per cent war loan yesterday, however, was not attributed so much to this quite logical factor as to the

sentimental effect of the knowledge that the New Zealand Government had underwritten a loan of £5,000,000 on substantially hotter terms than have been obtained by any British colony for some time.” “Financial News”:—"lt is argued that if New Zealand can borrow on these terms, our own Boverument securities ought to he put higher.” The “Financier,” April 21st: —“War loan fives wen* made to look extremely cheap by comparison, and advanced nearly a point, while Commonwealth 3 per cent, scrip ran up to 2$ premium, and Western Australia 5 per cent, scrip to 2’, premium. The fact that the New Zealand Government has been able to jdace a 5 per cent, loan at jaar is a striking indication of the change that has come over the investment mn'ket in the course of tins year.” ■‘Daily Express”- “It is a remarkable sui"miily tli.it New Zealand should he Born wing on lieltor terms than are actually being paid by the Biifish Government."