LONDON CONVERSION LOAN

Dominion, Volume 32, Issue 261, 2 August 1939, Page 10

LONDON CONVERSION LOAN

Details Of Arrangements APPLICATIONS TO CLOSE ON AUGUST 5 Arrangements for its conversion of New Zealand's £17,172,000 sterling loan, which falls due for repayment in January were explained by the ActingMinister of Finance, Mr. Savage, in his Budget speech last night. Applications are now being invited in London for a £16,000,000 sterling cash and conversion loan bearing interest at 31 per cent, per annum and issued at £99 per cent., he said. The balance of the total of £17,172,000 outstanding is held by New Zealand institutions, and other arrangements will be made for its conversion on due date. Further details regarding the loan are as follows:— (1) Holders of the £3/10/- per cent, stock, due to be repaid on January 1, 1940, have the right to receive, in exchange for each £lOO stock surrendered, £lOO £3/10/- per cent, conversion stock 1939-45 together with a cash payment of one pound. 12) Cash applications will bo accepted to an amount sufficient to make up, with the stock issued in conversion, a total of £16,000,000. (3) The proceeds of the cash receipts will bo applied toward redemption at par on January .1, 1940, of the £3/10/per cent, stock 1940, which has not been converted. (4) The new stock will be redeemed by purchase at or under par, exclusive of accrued interest, or by half-yearly drawings at par in sums of £lOO, commencing July 1, 1940. (5) The New Zealand Government have undertaken to provide for redemption of this stock by making available in London, out of funds accruing from exports from the Dominion or otherwise. sufficient sterling to repay the whole of this issue by January 1. 1945. by half-yearly instalments of £1.000.000 during 1940 and £1,750.000 thereafter, payable on or before June 30, and December 31 in each year. (6) During- periods June 5 to June 20, and December 5 to December 20 in each year, commencing in 19-10. holders of stock will have the option of converting such stock, in sums of £lOO, into one-half each of £3/10/- per cent, stock 1949-54 and 1955-60. at rates to be published from time to time.

To the extent that these options are exercised in any half-year the obligation to redeem in that half-year will be reduced. (7) The New Zealand Government reserve the right on or at any time after July 1, 1941. on giving not less than three months’ notice, to redeem at par the 'whole or any portion of the stock, not being less than a nominal amount of £1.000.000 sterling, at any one time. The list, for both cash and conversion applications, opened on July 26. and will close on August 5.