Local Bodies Raise £279,000 In 2 Months

Press, Volume C, Issue 29427, 1 February 1961, Page 17

Local Bodies Raise £279,000 In 2 Months

Local bodies in the Christchurch area raised £279,520 in loan money in December and January. Of this total, £24B,olo—one of the highest monthly totals in recent years—was raised in December.

The Christchurch Drainage Board was the biggest borrower over the last two months. A £300.000 issue came on the market in December, a month after the board had opened the lists for a loan of £lBO,OOO. December subscriptions to these two loans totalled £110,020 and January subscriptions £26.410. The board still needs £311.930. and the board’s officers. while pleased with the progress of these loans to date, emphasised yesterday that the amount of work in hand on the board’s schemes gave them little leeway. “We’ll take all we can get in the coming months,” one of them said. The low rate of subscription to local body loans in January was not unexpected, as holidays usually reduce loan transactions to a fraction of their normal figure. The opening of the Government loan today was expected by some officers to affect local body loan raising, Long-Term Loans

The terms of the latest Government loan were awaited with considerable interest in local body circles. The slight increase in the interest rate on the long-term stock—which now shows the investor a

return of almost 4} per cent.— virtually swallows up the slight premium formerly offered on this term of investment by local body loans. Restricted as to the proportion of short and medium-term stock they can offer in any one loan, and now unable to pay a higher rate of interest than the Government on long-term stock, local bodies feel that they are now competing on the loan market at a distinct disadvantage. “Since the last Budget it has been apparent that the Government intends to take a larger share of the available loan monies." said one local body representative. “The new Government apparently is committed to the same policy.” Details of loan money raised by Christchurch and North Canterbury local bodies in December and January are as follows: Raised Outst g. Jan. 30

£ £ Drainage Bd. 136.430 311.930 Paparua C.C. 7.900 44.850 Harbour Bd. 1.000 18.000 Hospital Bd. 74.840 — Tunnel road 59.350 — Totals 279,520 374.780