LOANS MATURING.

Auckland Star, Volume LXIV, Issue 16, 20 January 1933, Page 8

LOANS MATURING.

CORPORATIONS HARD HIT. AUCKLAND POWER BOARD. The chairman of the Auckland Electric Power Board, Mr. W. J. Holdsworth, said that body had a loan of £224,000 maturing in London on March 1 next, and the higher rate of exchange meant that the board would have to find an additional £56,000. It was a serious position, and the worst of it was that no possible provision could have bcci made to avoid the large amount of extra money the board would have to provide. "When the Prime Minister stated somo time ago that it was not for Parliament but for the banks to say what the rate of exchange should lie, and when the banks announced that ia their considered opinion the rate should not bo increased beyond the 10 per cent, then in force, we were satisfied that tht matter was finalised," said Mr. Holdsworth. "Consequently 110 provision was made, and we will be compelled to find a large amount of money that was never contemplated." Mr. Holdsworth said the board could not be expected to find these large extra unforeseen amounts, and it would have to consider what steps it would take to make fresh arrangements. He mentioned that the board had already approached the debenture holders for a five years' extension. As a member of the board which supervises the issuing of new local body loans, Mr. Holdsworth was .much pei turbed at the new situation that had been sprung on municipalities that had borrowed money in London. Wellington, Auckland, Christchurch, and Dunedin—in fact, all the large municipalities were going to be very seriously affected, because they all had loans maturing in London, and with an additional 25 par cent by way of exchange it was going to seriously test their finances. For instance, Dunedin had a loan of £250,000 maturing in London on April I next, and now it would have to find an extra £(!2,500 /instead of £25,000 when the rate of exchange was 10 per cent.