N.Z. LOAN SOUGHT IN BRITAIN

Press, Volume XCI, Issue 27679, 8 June 1955, Page 14

N.Z. LOAN SOUGHT IN BRITAIN

Cash And Conversion Issue To Be Raised £10,000,000 AT 41 PER CENT. (N.Z. Press Association —Copyright) LONDON, June 6. The New Zealand Government plans to raise a £10,000.000 sterling cash and conversion loan on the London market on Thursday. The loan, which carries 4$ per cent, interest, is made up of stock maturing in 1970-73, and it will be used to repay maturing loans to the Government The main maturing loan is the New Zealand 3 per cent. 1952-55 stock, and holders of this have, been invited to convert their holdings into new stock. The conversion lists close on June 2 °The last time the New Zealand Government came to the London market for funds was in 1949. Arrangements have been completed to deal with £11,984,000 of New Zealand’s 3 per cent, stock which matures in London on July 1 next, said the New Zealand Minister of Finance (Mr Watts) in Wellington, reports the New Zealand Press Association. “The needs of New Zealand are great in so many directions that it is apparent that they cannot be met entirely from internal savings, and that we must, therefore, look for outside capital if development is to be maintained,” said the Minister. “It is pleasing that New Zealand s high standing overseas has enabled a renewal of the maturing loan to be arranged on satisfactory terms. It has been agreed that the cash and conversion offer will be limited to £10,000,000, which will leave £1.984,000 to be repaid,” said Mr Watts. “Interest on the new loan, which will mature in 1970-73, will accrue at the rate of 4i per cent. The issue price is £97 10s per cent.” The Minister said that the terms of issue compared favourably with those for overseas loans generally and, while the issue had been underwritten, he was hopeful that the loan would be fully subscribed when the conversion lists closed on June 20. Discussions had been proceeding for some time with the British authorities, with particular relation to the uncertain state of the London stock markets arising, first from the recent elections, and latterly from industrial troubles, the Minister said.

New Zealand’s rapid development, her expansion in many productive fields, and the related needs for importing capital equipment and machinery, especially for such large and costly projects as the projected new electric power stations, were the most important considerations when dealing with overseas loans, whether for new money or in rearranging maturing loans.