RESERVE BANK SHARES

Press, Volume LXX, Issue 21089, 14 February 1934, Page 10

RESERVE BANK SHARES

ALL APPLIED FOR IN CHRISTCHURCH SUCCESS OF FLOTATION If expectations are fulfilled it will be found when the lists of applications for shares in the Central Reserve Bank close to-morrow that applications for the full number of 100,000 shares at £5 each have been received in Christchurch alone. At present it is estimated that applications for the allotment of fully 90,000 shares have been received through the principal agencies, and it is probable that when all applications have been sent in to the Treasury the total will be close to 100,000 for Christchurch alone. This indicates that for the whole of the Dominion the issue will probably have been subscribed four or five limes over and Ihat more than £2,000,000 capital will have been offered instead of the £500,000 which is required. In a telegram to "The Press" yesterday the Secretary for the TreasI ury (Mr A. D. Park) stated that I the lists would close definitely tomorrow. In the prospectus it was slated that they would close tomorrow at the latest, but the Minister reserved the right to close them at any earlier date. Mr Park, however, states definitely that they will noi, close until to-morrow. Sharing (lie Allotment Because the issue of shares has apparently been largely over subscribed, the small investor need not be deterred, even at this late date, since it has boon expressly stated that it is the Government's policy |to endeavour to spread the allotment over the largest possible number of investors. It is understood that all those who have applied for a few shares—say, two or three—will be granted the number they have applied for. while those who have applied for larger numbers will have their applications scaled 'down on a proportionate basis to suit the number left for allotment after the applications of the smaller investors have been granted. The prospectus of the Reserve Bank states: "In order that as many citizens as possible may have a direct interest in the Reserve Bank •as a national institution allotment of the share capital will be distributed as widely as possible over the Dominion and to the greatest number of applicants. Not more than 500 shares shall be allotted to any one person, whether in his own right or on behalf of any other person or persons." Many Investors Interested It is understood that a considerable number of applications have been received for the maximum number of 500 shares, since all classes of investors have been attracted by the cumulative dividend of 5 per cent., which compares more than favourably with the standard Government rate of 32 per cent. At Hie same time many small investors have applied for £5, £lO, and £2O worth of shares, and these applications will probably receive preference over the larger ones. The share lists have been carried 1 y the Treasury Department, the Post Office Savings Bank, and members of the Stock Exchange. Much publicity has been given to the issue, including the distribution oi large numbers of circulars and the display of many posters, so that the flotation has been brought well before the notice of the public. It is understood that the greater part i:f the applications have been put in through the Treasury and various stock brokers, although the Savings Bank is believed to have done a good deal of business. It is considered that immediately liter allotment the bank's shares should go to a premium on the market. Although they have no statutory guarantee they will rank as gilt-edged securities and will return interest at a rale 1.1 per cent, higher than the Government securities now being issued.