REDUCED INTEREST

New Zealand Herald, Volume LXXIII, Issue 22447, 17 June 1936, Page 13

REDUCED INTEREST

ALBERTA BONDHOLDERS ACCEPTANCE REFUSED ' EDMONTON. June 15 No bondholders appeared at the Alberta banks to-day to claim interest due on the 2,000,000-dollar bonds which Mr. William Aberhart, Premier, had announced would be paid only at 3 per cent instead of 5 per cent. The bondholders at a meeting previously had decided to refuse to accept the reduced interest and to await developments.

Mr. Aberhart announced on March 16 that legislation to call in all Alberta bonds and replace them with a new issue bearing interest at 3 per cent or less, would be introduced in the State Legislature within 10 days as a compulsory conversion of the 160,000,000dollar provincial debt. The saving in interest would be 7000 dollars a day. Legislation to compel a reduction of high interest rates on home mortgages was also planned. Mr. Aberhart stated that he had waited since December for some word from bondholders regarding a reduction of interest. "But I have had no response," he said, "so I must go ahead with compulsory measures. At the end of May Mr. Aberhart was faced with organised plans by Eastern Canadian holders of Alberta bonds to challenge in the Courts his compulsory interest reduction legislation, to become effective on Juno 1. The Pi'emier stated: "If they go to the Courts to prevent our cutting interest by Orders-m-Council, we will go the whole distance, proclaim the reduction and go right through with it."