LOANS FOE LOCAL BODIES.

Press, Volume LXIX, Issue 20898, 4 July 1933, Page 8

LOANS FOE LOCAL BODIES.

RATES OF INTEREST DEFINED. STATEMENT BY MR COATES. (PRESS ASSOCIATIOK TELEiS-RAIl) WELLINGTON, July 3. Following the recent decision of the Government to reopen over-the-counter sales of Government securities at 3? per cent., the Acting-Prime Minister, the Rt. Hon. J. G. Coates, to-day made reference to the position of the current issues of local body securities. Mr Coates stated that the Local Government Loans Board had been closely co-operating with the Government in the matter of interest rates, and he had been advised that the board at its meeting held on June 27, decided that the rates of interest on the local body loans sanctioned at that meeting and to be dealt with in future should be restricted to a maximum rate of 4 per cent for "best local authorities." "The board, recognising that all local authorities cannot be expected to place their loan requirements at this rate, decided upon an intermediate rate of 4& per cent, for secondclass local authorities, and 4J per cent, for smaller local authorities," said Mr Coates. "This approximately preserves the distinction which has always existed between the securities of local authorities of various classes." Mr Coates concluded by stating that he felt confident that local authorities would experience little difficulty in fulfilling their loan requirements at the rates now decided upon by the board. In fact, there was evidence that before the meeting of the board some loans had been arranged on a lower basis than those decided upon.