GREAT FUNDING OPERATIONS

Evening Post, Volume LXXXIX, Issue 147, 23 June 1915, Page 7

GREAT FUNDING OPERATIONS

LOAN IS NOT UNLIMITED. (Received June 23, 9.30 a.m.) LONDON, 22nd June. The prospectus shows plainly that only holders of the new war loan will havo the option of converting old loan or Consols. The 'treasury points out that the loan embodies a war loan' and great funding operations. It is estimated that £350,000,000 Consols ar© in -the hands of the public, and it is expected that the holders of £250,000,000 will convert, which will mean the subscription of £3^0,000,090. Similarly, it is expected that £200,000,000 of the old war loan will b© converted. This will carry a subscription of £210,000,000. Neither war stock nor Consols can be converted unless the holder is prepared to subscribe the equivalent market value of the new stock. The official expectation is that Consols will probably drop to £57 or £58 by October. The gain to the State will be the wiping Out of one-third of the earlier capital indebtedness, if all th© Consols are converted. Though the amount of the loan is not stated, it is not unlimited, as the resolution of the House fit Commons confines it to the 6upply voted for the present year — that is, between £900,000,000 and £1,000,000,000. Mr. M'Kenna stated that the Government would not be disappointed if it gets £600,000.000 of new money. The Fmanoia^ Times fear« that, m view of the basis of credit established, some severe readjustments will have to be made in the value of certain Colonial Government and high-class corporation issues.