INTEREST DEFAULT.

New Zealand Herald, Volume LXIX, Issue 21099, 5 February 1932, Page 9

INTEREST DEFAULT.

COMMONWEALTH ACTION. BONDS RISE IN NEW YORK. tßeceired February 4, 6.25 p.m.! NEW YORK, Feb. 3. A slightly incorrectly -worded press despatch ifom Melbourne to-day stated: " Mr. Lyons announces that the interest payments on New South Wales bonds due in London and New York will be met by t.he Commonwealth Government." This caused a marked recovery in Australian issues. Comment showed there is an imperfect understanding of the position, namely, that the Commonwealth will nse the funds due to New South Wales to pay the bondholders, and not directly meet the charges. MOBATOBIUM PLAN. AMERICAN BONDHOLDERS. NO REPRESENTATIVE BODY. LONDON. Feb. 3. " It. looks a good thing for the lawyears." was the only comment of Mr. A. C. Willis New South Wales AgentGeneral, regarding the Commonwealth's action in issuing a writ against New South Wales. The Chase National Bank, on behalf of the United States bondholders, in response to Mr. Willis' overtures for a moratorium, has replied thai there has been difficulty in finding a representative body on behalf of the bondholders she same as exists in Britain. Mr. Lyons' statement that the Commonwealth wonld ultimately be responsible for the State debts had a soothing effect in the city to-day. Prices of Australian stocks rose slightly, and the issues of some States recovered 20b to 40s. DOMINION LOANS. QUESTION OF STATUS. NO ALTERATION UNDER LAW. LONDON. Feb. 3. The trustee stains of New South Wales and other Australian loans is not affected by the default of New South Wales in her interest payments, according to a financial authority. He says the Trust.ee and Colonial Stocks Acts do not contain provisions which would permit Dominion stocks to be deprived of their trustee status once it was acquired.