ADVANCES DEPARTMENT

Nelson Evening Mail, Volume LVI, 14 July 1925, Page 9

ADVANCES DEPARTMENT

A FIXE RECORD

It was mentioned in the House of lUpresentjitivos a few days ago that 'he rates of interest charged by the State Advances De-par'.mnnt on loans t are hkyly.i.n tthe rfe-'ii’ ;l td tiro jk> bo raised to : some, extent. This, of course, will riot, peeps on surprise. Th« position Ins to be faced that the Government for years past has been borrowing money in London tit higher interest | rates than those charged by the Ad- | vauees Department <:i a considerable propoition of its loans. A loan front | the State Advances Department is one i t the few things that is to be obtained at pre-war price. Ho-using loans are I still being made by the Department, at | a net. interest rate of 4-j, per cent., | although every post-war loan obtained by this country in London has been tamed at a higher rate. The interest and redemption cost of the recent seven million loan, of which two millions is to he used for advances, is a little over 5 per cent. The Department has only been enabled to continue lending money at tile- low rates it is still charging because it. is turning over a great deal of capital borrowed years ago on much 111 -re lavourable terms than can now be obtained on the London market, hr mi the point of view of tlm indivi dual borrower, the existing slate of a Hairs obviously is too good to last-m.-icii longer. More particularly when account is taken of the enormous settle on which housing and other advances have expanded in poet-war years, a remarkable financial aehievment is implied in the tact that the Department was me compelled to increase its lending rates some time age. Dominion, W i liington.