FACTS FOR INVESTORS.

Auckland Star, Volume LXVIII, Issue 47, 25 February 1937, Page 4

FACTS FOR INVESTORS.

INTEREST RATES. CONDITIONS IX AUSTRALIA. That interest rates are definitely higher in Australia than in this Dominion is evident from the following paragraph taken from a recent issue of the Melbourne "Argus":— "Although full public subscription for its cash and conversion loan of £630,100, offered at £4 2,'6 per cent, was r.ot obtained by the Melbourne and Metropolitan Board of Works, the result is not likely to cause the board any anxiety, because it has funds in hand sufficient to redeem the unconverted balance, which amounts to £286,100. The result of the loan, nevertheless, shows again the rising tendency of interest rates. It is a tribute to the exceedingly high standard enjoyed by the Melbourne and Metropolitan Board of Works that it was able to obtain so lartte a proportion of the £630.100. taking into consideration the comparatively modest return offered to the investor. "The hoard was unfortunate that its loan was on offer at the same time as a Commonwealth loan of £7.500,000. subscriptions for which fell short of the amount sought by about £2,000.000. and the market was affected generally at the time by the British constitutional crisis. The return from the Commonwealth loan, £3 19, 4. including redemption, compared very favourably with that of the Board of Works loan, because Government loans are exempt from State income tax, State unemployment relief tax. and special State tax. In June the Board of Works had a cash and conversion loan of £196,440. at £4 3 6 per cent, oversubscribed by £257.000. but it is hardly a surprise that a less attractive return on a rising money market should fail to evoke the same response." The New Zealand Government recently invited subscriptions to a debenture issue with an interest return of 3V« per cent.