CONVERSION OFFERS

Evening Post, Volume CXVI, Issue 146, 18 December 1933, Page 10

CONVERSION OFFERS

RIGHTS OF LOCAL BODIES

AUSTRALIAN APPLICATIONS

Authority £91- the Minister of Finance to consent to offers received from overseas bondholders to a voluntary conversion of their stock to a lower rate of interest is provided in the Finance Bill which was introduced in to tho House on Saturday night. It is understood that the object of the clause is to meet applications which have been received from Australia. The conversion operation is limited to existing securities on which, at March 31, 1933, the place of the payment of interest and the repayment of principal was beyond New Zealand. The Bill also authorises the Minister to agree, as from March 31 last, to the conversion of any existing securities on such terms as to interest, date or dates of maturity, premium or otherwise as may be mutually agreed upon between the Minister and the holder. The object of this clause is to enablo the Minister to issue, by arrangement, conversion stock with special maturity dates, and in return for this concession to be empowered to pay interest at rates lower than 4 per cent, for ordinary stock or 31 per cent, for tax-free issues. The Minister is also authorised to pay premiums where the reduction in interest exceeds 20 per cent., but the premiums are to be computed on the same basis as those granted under the terms of the main conversion operation. Authority is also given for the utilisation of New Zealand Government stock issued in conversion of existing securities and available for the payment of death duties to be used for that purpose, notwithstanding the fact that the existing securities did not have the condition of availability for this purpose attached. The rate of interest on loans made to the Samoan Treasury is to be reduced to ii per cent., this only applying to loans made on or before March 31, 1933. ' ■