NEW ZEALAND’S LOAN

Sun (Auckland), Volume III, Issue 769, 16 September 1929, Page 9

NEW ZEALAND’S LOAN

DOMINION CONGRATULATED BY PRESS UNDERWRITING ARRANGED Australian and N.Z, Press Association) LONDON, Saturday. Underwriting has been arranged tor the New Zealand conversion loan of £5,000,000 of 5 per cent. 1935-45 stock. As previously cabled holders of the maturing 4 per cent, consols are offered £IOO of the new stock with a cash bonus of £2 in exchange for £IOO of the old stock, the balance of the latter, about £4,700,000, to be paid off in cash on November 1. In financial circles the terms are considered very favourable to holders of the maturing stock, who, it is believed, will probably jump at the chance of obtaining 5 instead of 4 per cent, interest, and also a cash payment of £2 per cent. The “Evening Standard” congratulates New Zealand on finding a way out of the difficulties arising out of the present monetary situation. By offering conversion into 1935-45 stock, it remarks, New Zealand has the option of repaying the loan in six years if conditions should so far improve as to make this desirable, and avoids involving itself in a long-term loan at a higher rate than New Zealand's credit in the ordinary way would warrant. The “Morning Post” says it came as a welcome surprise to the market that the toal outstanding was under £10,000,000. It was felt that from every viewpoint New Zealand had followed a -wise policy and one likely to ensure a favourable response from holders of the maturing stock. It would have been most difficult to place a large cash loan at present. Indeed New Zealand would have suffered' as regards her credit, not from deterioration of her own financial position, but as a result of the exigencies of the general monetary situation. Also the effect might easily have been unfavourable to colonial, and, indeed, to all gilt-edged securities. GOVERNMENT’S DEFEAT ADVERSE EFFECT ON SHARE MARKET Reed. 1.10 p.m. SYDNEY, Today. The defeat of the Federal Government on its arbitration abolition proposals lias had an immediate adverse effect on the share markets, but the decline is not serious, and prices already display a steadier tone, though a sustained recovery is hardly to be expected until the disquieting generalelection conditions end. , The activity of the past few weeks has been remarkable, in view of the prevailing uncertainty.