AUSTRALIAN FINANCE AND INSURANCE OFFICES

Otago Daily Times, Issue 21365, 19 June 1931, Page 6

AUSTRALIAN FINANCE AND INSURANCE OFFICES

TO THE EDITOB. Sib, —I was much perturbed on reading in to-day’s issue of your paper that the Life Offices’ Association of Australia had promised co-operation in the scheme for the conversion of the public debt, to the extent of accepting interest at not more than 4 per cent, on, Government securities held by them, which are now producing 5J per cent, to 6 per cent. Such securities represent a considerable portion of their assets, and the fall in the rate of interest Will have a disturbing influence, so much so, that the interest earning power of the remaining assets will be affected. The farmers —the backbone of any country—are entitled to liberal treatment, and will doubtlessly press for a reduction in their interest.

The premiums charged by the company in which I am interested are based on 3 per cent., and if the funds earn but 4 per cent, then, after deduction of administration expenses, etc., the surplus available for distribution amongst us policyholders in the way of bonuses will be negligible.. Whilst I sympathise with Australians in their financial embarassmcnt I am averse to contributing to the gift of £1,250,000 to £1,500,000 per year to the Commonwealth Government, and that is how the conversion appears to affect me.—l am, etc. . POWCTHOLDEB. Dunedin, June 18.