“PAY IN STERLING”

Gisborne Times, Volume LXXIII, Issue 12140, 30 December 1933, Page 5

“PAY IN STERLING”

INTEREST TO LONDON BONDHOLDERS (Press Association) AUCKLAND, Dec. 29. A decision to Pay in sterling '‘without prejudice’’ on January 1, the half-yearly interest due in connection with those debentures of the tramway loan of £1,250,000 lawfully domiciled ill London, was made by the Auckland Transport Board today. The question was discussed at a special meeting following the return to New Zealand earlier in the day of the chairman, Mr J. A. C. Album, who left for London on September 23 to endeavour to arrange with English bondholders a mutually satisfactory plan for reducing the amount of interest payments. The board’s decision was made “in view of the recent decision of the House of Lords” in the case of the Adelaide Electric Supply Company case, given after Mr Al-lum had lelt London. ■lt was revealed ill the' chairman’s report, however, that after consultation with a section of the English bondholders, a plan had been propounded whereby the holders should accept a reduction of f per cent, in the rate of interest, and that payment ok interest should be postponed for five years, both interest and principal to be payable in English currency. The arrangement provided for consideration of a suitable adjustment if the judgment in the .Broken Hill case were reversed. Mr A Hum consulted l the board by cable regarding the offer, but the board rejected it. Mr Allum said that interference on the! part of the London Stock Exchange was the real difficulty he had to face. When the board; decided' not to adopt the proposal regarding the reduction of 2 per cent, fh the rate 'of interest, Mi* Allum thought it best to return to New Zealand as sooii as possible. Mr, Allum said he was -still of opinion that local bodies should take every step possible* in an endeavour to secure a reduction in interest Charges. He had found the bondholders in England very reasonable. ■ The board paid R® last half-yearly instalment ol f interest in London- in sterling without, prejudice.