Broadbank loan not an offence, says P.M.

Press, 14 June 1984, Page 8

Broadbank loan not an offence, says P.M.

PA Wellington The Broadbank Corporation has not committed an offence when it lent money at 22.5 per cent this year, said the Prime Minister, Sir Robert Muldoon, last evening.

Speaking in the Address-in-Reply debate in Parliament, Sir Robert said a preliminary investigation had shown there was nothing wrong with the agreement it had made to lend money at that rate. The Leader of the Opposi-

tion, Mr Lange, said in Parliament last week that the loan was delivered in March but dated last year. He claimed it was a device to avoid financial regulations.

Sir Robert had promised an investigation into the matter. He said last evening that the loan involved a couple who were building a house last year with a Housing Corporation loan. Broadbank had agreed to give them a second loan charging about 22 per cent in-

terest, which was the going rate at the time.

When they went to get the loan Broadbank told them it was not caught by the regulations because the arrangement had been made last year before they were introduced.

They signed a piece of paper saying the parties agreed the deal was made before the regulations were in force.

“It is quite straightforward and no offence (has been) committed by either side,” Sir Robert said.