CONVERSION LOAN

Evening Post, Issue 20, 23 July 1935, Page 4

CONVERSION LOAN

LABOUR CRITICISM

MINISTER'S COMMENT

(By Telegraph—Press Association.)

CHRISTCHURCH, July 22,

During the Lyttelton by-election campaign the Labour candidate, Mr. T. H. McCombs, has referred frequently to the recent conversion loan, stating that the operation was not such a signal success as the Government claimed, and stating also that the issue price of 98-i was too low. This, -he argued, was proved by the fact that the stock had been resold at a premium of i per cent., so he argued that New Zealand had made a present to the bondholders of £140,000. Tonight Mr. M. -E. Lyons, the Government candidate, referred again to the subject, quoting a statement he had received by telephone from the Acting Minister of Finance (the Hon. A. Hamilton). Mr. Hamilton had stated that at the time of the issue the price of 98J for 3 per cent, stock was considered good, having regard to the prices cm the London market of similar stocks. It was not correct" to assume from the news cablegrams that the stock had been sold at a premium of ;} per cent., that it had been sold for 100}, and so to calculate that New Zealand ha:d lost £140,000. Actually the stock had risen to 983, a rise of i per cent.

Mr. McCombs had mentioned that 3 per cent. New Zealand stock was selling at £101 12s 6d. Actually this was not conversion loan stock, said Mr. Hamilton. It was stock of a loan which had been current for many years, and which matured in 1945, whereas the conversion loan, matured in 1955: also on that stock there was four months' accrued interest.