LONDON INTEREST

Hokitika Guardian, 30 December 1933, Page 5

LONDON INTEREST

STERLING PAYMENT 1

AUCKLAND TRANSPORT LOAN

(Per Press Association, Copyright)

AUCKLAND, December 29

A decision to pay i u sterling, without prejudice, viie half-yearly interest due on January I, in connection with tnose debentures Of the Auckland Tramway loan of £1,250,C0Q Lwfuliy domiciled, in London, was made by the Ai.cKiand Transport Board to-day.

The question was discussed at a special meeting, fp.lowing on the return to i\ew Zealand, earlier in the day of the chairman, Mr J. A. Allum, who left for London on September 13, to endeavour to arrange with the English bondholders a mutually satisfactory plan for reducing the amount of the interest payments.

The Board’s decision was made “in view of the recent decision of the I House of Lords” in the case of the j Adelaide Electric Suppy Company, ; which decision was given after Mr ! Allum had left London. It was revealed -in. the chairman’s report, however, that after consultation with a section of the English bondholders, a plan had been propounded whereby the holders should accept a reduction of three-quarters cf one per cent in the rate of interest, and that the payment of interest should be nostponecTfor five years, both the interest and the principal to be payable in English currency. That arrangement provided for the consideration of a suitable adjustment if the judgment in the Broken Hill case were reversed. Mr Allum consulted the Board by cablegram regarding the offer, but tile Board rejected it.

Mr Allum said that interference on the part of the London Stock Exchange was the real difficulty which he had to face. Whe n the Board decided not to adopt the proposal regarding a reduction of three-quarters of one per cent, in the rate of interest Mr Allum thought it, best to return to New Zeaand as soon as possible. Mr Allum said that lie was still of the opinion that the local bodies should take every step possible in the endeavour to secure, a reduction in their interest clmrpys. He h-d found the bondholders in England were very reasonaide. .u

The Board paid its lost half-yearly instalments of interest in London in sterling without prejudice.

BRITISH FINANCIAL -SYSTEM

NEW ZEALAND EXCHANGE RATE

AUCKLAND, December 29. The chairman of the" Transport Board (Mr A. 0, Allum), who went to London on business relating to the Board’s loan commitments, returned to-day. He declined to disclose the outcome of his mission, until a special meeting of the Board has been held. Mr Allum said that he found business men, as represented by the London Chamber of Commerce, thoroughly dissatisfied with the existing financial system, and they were making sterenuous efforts to bring about such a change as would enable industry to function normally. In the past, the activities of financiers had not been of very great concern, owing to the tremendous amount of development taking place, but now there was an obvious desire to impress upon those controlling finance, that, while they were still an important part of the machine, they were not the whole machine.

Air Allum said that, meeting representative men, he found no serious criticism of New Zealand’s raising of the exchange rate, and as far as he could judge, the statements made- in connection with it were purely propaganda by interested parties. The question of export- quotas was not in the remotest degree associated with the New Zealand Government’s tariff or exchange policy. It appeared that the Engisli authorities were resolved to re-establish their farmers. That involved a considerable amount of control of the farming industry generally, and obvious that control was being extended to imports from overseas .

“To-day, there is no room for the interested party which issues apparently important statements merely as propaganda,” said Air Allum. “llie only thing that matters is the welfare of pcoole as a whole. S.o far as I can see, the- motto of the people of responsibility at the present time, is ‘AYolfare. not wealth.’ ”