WELCOME LOAN

Grey River Argus, 28 May 1938, Page 7

WELCOME LOAN

£55,000 AT 3J PER CENT.

From Invercargill Savings Bank

IPer Press Association.! INVERCARGILL, May 27,

An offer by the Invercargin Savings Bank to lend the Invercargill 'City Council, at 3 i per cent, interest, the money required for its works programme for the first year, namely fifty-five thousand pounds, was accepted by the Council, at a special emergency meeting this evening. It was agreed also that the Invercargill Savings Bank should be given the first opportunity of lending the moneys required for the remaining two years of the term of office of the Council. The amount of money required, including £55,000 for the first year, is £117,500. The Mayor (Mr. John Miller) and Councillors, described the offer as a very good one. Negotiations had been in progress with the Invercargill Savings Bank for some time, said the Town Clerk, Mr. W. F. Sturman. All of the local bodies of New Zealand had been limited by the Local Government Loans Board to paying 31 per cent, for their moneys, and most of them had had the utmost difficulty in obtaining money at such a low figure. The Invercargill Savings Bank had acted very generously, however, and had offered the money to the city at 31 per cent., some for i period of 30 years, ajid some for .20 years. The terms were generous. There would be no sinking fund. AU that was asked was a flotation charge of a half per cent, to provide for the cost of raising tne loan, including legal fees. The Mayor: I consider it a very good offer. The way of paying it back is by means of principal and interest, a very good way of repaying loans. There is no sinking fund, and the money is being raised in Invercargill.

Cr. A. W. Jones said he thought it was a wonderful offer. Cheaper interest could not be foreseen anywhere.

“It speaks volumes for the soundness of the city and its solidity financially,” said the Town Clerk, after the meeting. “The arrangement particularly appeals in that the money paid in interest will be circulated in Invercargill.”