CONSOLS CONVERSION SCHEME.

Evening Star, Issue 7469, 13 March 1888, Page 2

CONSOLS CONVERSION SCHEME.

[Special to Press Association.]

London, March 10,

Mr Goschen's conversion scheme provides for the conversion of 166,000,000 new 3 per cents. ; 69,000,000 of reduced 3 per cents.; and 123,000,000 worth of consols, redeemable in fifteen years at a percentage of 2f, or in twenty years at 2|.

(Per Press Association. 1 London, March 10,

Mr Goschen's conversion scheme merges the different stocks into one. Holders of the new 3 per cents, are offered 3 per cent, for tho current year, and 2 J per cent for the next fourteen years, at the end of which period the interest will be reduced to 2| per cent. The latter rate will continue till tho expiration of the twentieth year. Holders wishing to be paid off in cash at the end of a year's time must signify their wish by March 29. Holders of consols and reduced 3 per cents, are offered similar terms, with the addition of a 5s cash bonus and Is 6d for brokers. The conversion proposals will affect 1558,000,000 worth of stock.

Mr Gladstone applauded the scheme, and expressed the opinion that much public benefit would result from it. All the newspapers speak in favorable terms of it.

Londojj, March 11

Mr Goschen states that he has no fear that foreign complications will compromise his conversion proposal. He also believes that the scheme will ultimately effect a saving of L 2,800,000 annually.

Treating on the subject of the conversion of loans, the last number of the ' Banking; and Insurance Record' observes :—" Mr: Goschen will, it is believed, lav a Bill before i Parliament to give effect to hi& plans, and ! we are, therefore, on the eye of witnessing j an experiment in the conversion of loans on ; a large scab. It should be noted that the Chancellor of the Exchequer possesses a • great advantage namely, that having ; the power to redeem a certain amount! of consols at par every year, the bond-' holders are kept in a state of uncertainty, • which they would escape from by ex-; changing their holdings for a stock irredeemable for a fixed number of years.; In the United States also a large conver-; sion scheme is before the public. It is! proposed to convert per cents, (nearly j 200 millions sterling) into 2£ per cents.] The United Stated Treasury possesses the' enormous advantage of having a large stock i of treasure in its vaults which it can apply; in paying off the premium on the oonversion i in cash while'issuing bonds at par for the | existing bonds. It would thus reduce the; rate of interest, the saving effected being! the amount of this reduction and the pre- i mium paid in cash. The operation of the plans adopted to carry through both the British and the American conversions will be watched with muoh interest," "'• '' '