CHEAP MONEY.

Waikato Times, Volume 119, Issue 19897, 28 May 1936, Page 9

CHEAP MONEY.

MORTG'AEE CORPORATION. STATE ASSUMES CONTROL. PRIVATE smnss CANCELLED. } \\'ELLIXGTON, \\'ednesdsy. The Government's intentions regarding the future of the Mortgage Corporation were announced iby the lion. \\'. Nash. Minister of Finance, in the House of Representatives last evening in introducing the Bill which reconstitutes the Corporation. .\ir .\"ash said the new name of the Corporation would be the State Advances -L‘.orporatlon of New Zealand. The private shares in the corporation .were cancelled and there was provision for repayment to those who had subscribed money for shares. One year‘s dividend would be paid in addition. The capital remained as under the Mortgage Corporation Act. The board of management was entirely reconstituted, but the two managing directors remained, one as chairman of the board and the other as deputy chairman. “The State Advances Corporation takes over the administration of housing." the Minister continued. “In re—gard to the raising of money the corporation still has the right to issue bonds and these will be guaranteed by the Government, which means that the money will probably be raised at a lower rate of interest. Loan: for Houolng. “There is power for the issuing of loans to local authorities for housing purposes and tliere will be loans to industry after the project concerned has been examined by the Bureau of Industry. The Minister of Industries |and Commerce will he engaged in find—ing industries that need and deserve help, and if Cabinet approval is given the Minister of Finance will he empowered to make advances." Stock or Cash. Referring again to the cancellation of shares in the corporation as at present constituted, .\lr Nash said the share capital would be purchased and a price would be paid in proportion to the amount paid in. Shareholders would get either stock or cash. The corporation proposed to issue 4 per cent. stock. and investors would get their money back, plus a. return on it at 4 per cent. equal to what they would have got at 4} per cent.. the rate at which they had invested. l "The Bill will extend the margin on loans," the Minister continued. “At {present 66 2-3 is the maximum the Icorporation can advance without the guarantee of the Minister of Finance tend the Government. Under the Bill (-6 2—3 per cent. remains the maximum for commercial propositions, but, it is to be extended for housing. Mr \Vilkinson: What will he the rate of interest? I The Minister: That has yet to (be determined.