CONVERSION OF DEBT.

New Zealand Herald, Volume LXVII, Issue 20626, 26 July 1930, Page 15

CONVERSION OF DEBT.

DISPOSAL OF 1929 CONSOLS

OVER £1,000,000 PAID OFF,

PORTION MOVED TO DOMINION

[ny TELEGRAPH. —SPECIAL REPORTER.] WELLINGTON, Friday.

The final result of the steps taken to meet tho large amount of debt that matured in London on Novbmber 1 is shown in a summary of the various operations contained in tho Financial Statement. Tho original amount of tho debt concerned was £29,490,852 and the rate of interest was 4 per cent. Three conversion offers were made to the holders of the stock —in May, 1928, January, 1929, and November, 1929. A total of £21,759,496 was converted into other stock, and £575,949 redeemed out of the proceeds of issues in London for purchases on tho market. The new stock thus created amounted to £23,074,789, of which all but £31,350 was issued in London, representing an increase in the debt of £739,344. Allowing for the redemption of this amount of additional stock and other expenses of conversion over tho respective periods of the new stock, the average annual cost of this part of the debt is now £4 19s 6d per cent, per

annum. Tho proceeds of issues in New Zealand provided for the redemption of £5,968,786. As these were made at par, they did not increaso the debt. Tho average annual cost of tho new securities issued locally is £4 12s lOd per cent. Redemptions out of debt-repayment moneys and sinking funds, which represent definite reductions of debt, totalled £1,186,621.

Referring to the final operation, when £9,731,356 remained to bo covered, the Prime Minister said that holders of the stock to the amount of £3,628,102 accepted the conversion offer, and the underwriters took up the balance of the £5,000,000 offered. The remaining amount, £4,731,356, was redeemed on the maturity dato, the whole of the necessary funds being provided from New Zea1and—£4,047,235 from the proceeds of local issues, partly for departmental investments (mostly at 4 per cent, interest), and partly to the public, at 5 1-8 per cent, interest; £672,000 from public-debt repayment moneys and £127121 from special sinking funds. " One result of a'l these operations is that our external debt wqs reduced by £6,400,000, which economically means that the Dominion has discharged its obligations to that extent," the Prime Minister added. " The redemption of such a large amount of London debt, necessitating Iho transfer of over £7,000,000 of cash from Npw Zealand over the period of the transactions, was verv favourably commented upon in that financial centre. Local sales of 5 1-8 per cent, securities, aided by departmental investments, provided £5,959,288 of the required funds, the balance for the repayments being drawn from revenue and sinking funds."

BORROWING IN DOMINION

PROCEEDS OF 5* PER CENT. LOAN

Funds raised in New Zealand by borrowing during the last financial year amounted to £4,099,325, according to tho Financial Statement. This comprised £1,677,325, mostly at 4 per cent, to 4J per cent., from departmental investments, and £2,422,000 from the public, £726,620 bearing interest at 5 18 per cent, and £1,695,380 at per cent.

INCENDIARY FIRES.

REWARD FOR INFORMATION.

QUESTION OF PAYMENT.

[ lIV TELEGRAPH. —PRESS ASSOCIATION'.]

WELLINGTON. Friday

Jn reply to a question by Mr. D. G. Sullivan (Labour —Avon) as to what decision had been reached with reference to tho payment of the £250 reward offered for information that would lead to the conviction of tho persons responsible for tho incendiary fires in Christchurch last year, the Hon. J. G. Cobbe, Minister of Justice, replied that the Police Department bad nothing to do with the payment of the reward." It was offered by the council of tho Fire Underwriters' Associations and the State Fire Insurance Office for "information supplied to tho police." Tho only information given to the police was that supplied by the offenders themselves after they were arrested on another charge.

MORNING SIDE CROSSING.

ARGYLE STREET ACCIDENTS

WARNING CONSIDERED ADEQUATE

[IIY TELEGRAPH. —SPECIAL REPORTER.]

WELLINGTON, Friday

Attention to tho number of accidents which have recently occurred at the Argyle Street railway crossing, Morningside, was drijwn by Mr. 11. G. R. Mason (Labour —Auckland Suburbs) who asked the Minister of Railways, the Hon. W. A. Veitcli, whether steps would be taken to abolish tho crossing. Replying to-dav, the Minister said the mode of providing warning to traffic at this crossing has received tho careful attention of tho department. A modern and effective warning device of the Pearson type is provided at tho crossing. Provided road-users exercise reasonable care, there is littlo risk of accident.