CONVERSION OFFER

Hokitika Guardian, 22 July 1933, Page 6

CONVERSION OFFER

ANNOUNCED BY THE TREASURY

BRITISH WAR LOAN FROM U.S.A

LONDON, July 20,

The Treasury announces a new conversion offer. It is one dealing with a loan of 250 million dollars that was raised by Britain in the United States in January 1917 for the purchase of munitions. The issue, after a certain amount of conversion, ultimately took the form of twenty year gold bonds pitying - five and a-lialf per cent, interest, and at par on February 1 1937. These bonds were in dollar demoninations. a The Government now offer an exchange on the. basis that the holder shall receive bonds of £260 each for etfery one thousand dollars worth of the 5i per cent, gold bonds. The new sterling bonds will be repayable at London on February 1, 1937, and will bear interest at the rate of two and .a-lialf per cent, per annum, to be payable half-yearly, the first payment being due on Febuary 1, 1934, with the income tax deductible at the source.

The Treasury states that the effect of its offer will be to increase the total amount of the principal but it will diminish the interest payments during the period remaining before gold legislation. The offer is the result, of the recent maturity. The amount: of twenty year bonds outstanding i,= 136,333,500 dollars, or £28,013,733: sterling, at par. the interest on which is equivalent to £1,540,755 yearly, while the interest on the new sterling bonds will be £886,168 yearly.