BRITAIN’S FINANCE

Hokitika Guardian, 31 August 1932, Page 5

BRITAIN’S FINANCE

A REVIEW MADE

BY CHANCELLOR OF EXCHEQUER

IBritish Official Wireless.)

RUGBY, August 29. On this return . from Ottawa, the Chancellor of the -Exchequer has reviewed the position arising from his request to intending borrowers to refrain from coming on ithe market pending the completion of the' conversion operation.

In view of the gratifying high percentage of assents already received from holders of the war loan, the Chancellor now feels satisfied ithat some partial relaxation of the present arrangements may safely be permitted, but for the time being he requests only the following operations be undertaken: Firstly, the mere 'Exchange of one class of security for another, without change of ownership ; and, secondly, the issue of a new security to replace, any security, the final redemption of which had, prior to July, 1932, been - fixed for a date earlier than December 1 next.

It .is stipulated also that such operations shall concern only the British, including Empire sterling issues, domiciled an London, and involve neither provision of now ca-h, nor underwriting.

BAN ON NEW LOAN ISSUES,

TO BE PARTIALLY RELAXED

LONDON, August 30

. Commentators point out that the ban on new loan issues will now be partially relaxed, ’there wee previously no legal embargo it is stated, but merely a Government request, and this was accepted in financial quarters as being necessary .in the national interest. A semi-official statement eays that the Government are not seeking anything in the nature of State control ol investments. They are only actuated under expert advice, by their desire to complete Britain’s huge war loan conversion.

Ther e probably will be a progressive removal of the ban on loans here, beginning in October next. It /will not be a sudden removal of all restrictions.

The “Financial News” says: The Treasury .announcement affects to li ft the embargo partially, yet without lifting it at all. It will interest solely Australia, who will b‘e given a monopoly at least until October Ist, and probably later, This gift may be a generous one, hut it will be .at the expense of. ith-e investor, and, in our opinion, it will be inexcusable. Australian loads are a good investment, as manymay .think, but they are not everybody’ft natural selection.”

DETAIL OF TRANSACTIONS

* REPAYMENT OF CREDITS

RUGBY, August 29,

In view of there being entirely inaccurate reports now current in certain quarters regarding the British repayments of the credits that were ob■JuntH last year from the United States, it is necessary to re-state that all sums drawn against that credit were finally repaid last April. Full details of these transactions -undertaken during the crisis last year were as follows :

Original Treasury credits were obtained from rthe United States, totaling two hundred million dollars mi August 28th lagt year. Credits from France of two [thousand five hundred million francs were obtained by the banks on September 10th.

Credits for two (thousand five hundred million francs were obtained by a public issue of bonds in France on September 10. The first repayment 'was made on March 4 of this year when one hundred and fifty million dollars finally was repaid to the United States without the right of. withdrawal. On March 29th, thirty million dollars were repaid, but this with (the right to reborrow up to August 28th 1932.

On April sth last, twenty million dollars were repaid under similar conditions with the right to reborrow. In regard to the credits from France repayments were made this year as follow: On March Ist, twelve hundred million francs; on March 2nd, three hundred and fifty million francs ; on 'March ifUth, nine hundred million francs. All of these repayment were made with the rght to reborrow up to September 10th (the anniversary of the original loan). Thus itlie l wbo’e of the United credits, and half of the French credits, .were repaid in March and Apr'l last. Approximately half of this represented final payment. The right of the British Treasury to redraw has never been exercised, and it will now finally lapse. Arrangements havo been made for f y.„ repayment’ on the due date. September 10th. of the K t outstanding portion of Cm ordinal credits. )V .v „i V) two (f oil: and five hui>'b«d million’ francs that was subscribed by the French public in the form of bonds.

Therefore the wh«V of tb« foreign credits acouired in tlie emergency lard summer, whether current, or in the Iform of contingent rights, will bardisappeared, the repayments in all eases having been made in fill l .