LONDON LOAN

Otago Daily Times, Issue 23883, 10 August 1939, Page 12

LONDON LOAN

OPERATIONS COMPLETED MONEY NOW AVAILABLE STATEMENT BY MINISTER <From Our Parliamentary Reporter) WELLINGTON, Aug. 9. " Information has been received to the effect that the loan operations have been completed," said the Acting Prime Minister (Mr P. Fraser) when asked to-night whether the Government had been advised of the results of the London conversion loan. " Therefore, the money is available for the repayment of the maturing loan," he added. THE LOAN GUARANTEE AN UNUSUAL METHOD LONDON, Aug. 9. (Received Aug. 10, at 11 a.m.) Because of the unusual method of guarantee, interest is being centred in the New Zealand loan, in which dealings are expected to begin today about par. The issue was not underwritten in the usual way. The Bank of England called on the banks to guarantee to a maximum of £6,000,000 any part of the loan not covered by conversions or cash applications. The Bank of England itself guaranteed the balance of £ 10,000,00 without commission. . The banks are unlikely to disclose how much stock they take up. It is anticipated that a fair amount of the maturing stock will be converted, but it is thought unlikely that the public subscriptions will be large. It is understood that the clearing banks converted their holdings in the existing loan, but all the discount houses have not been willing to convert, chiefly because of a possible difficulty of obtaining call money loans against the new loan. The London funds of the New Zealand banks are so low that they are not in a position to advance substantial amounts at call, while London clearing banks are not anxious to accept the new loan as collateral for day-to-day loans. DEALINGS ON EXCHANGE PREMIUM Or 7 HALF-A-CROWN (Independent Cable Service) LONDON, Aug. 9. (Received Aug. 10 3 at 1.40 a.m.) Dealings in the New Zealand loan began on the Stock Exchange at a premium of 2s 6d. Contrary to the general procedure, the result of the issue was not officially announced, and the market was left guessing how much of the loan was taken up by cash and conversion applications. It is believed that the Bank of England and the " big five " banks which underwrote the issue have been left with over half the loan. BANKS' GUARANTEES A VEIL OF SECRECY . LONDON, Aug. 9. (Received Aug. 10, at 2 a.m.) The Associated Press says officialdom has drawn a veil of secrecy around the New Zealand conversion loan, which, when opened, was quoted at from one eighth discount to one sixteenth premium, and there were very few dealings. No information is forthcoming concerning what banks assumed guarantees. The High Commissioner's office has no information with regard to the arrangements cabled earlier. It seems that the public's ultimate response will be preserved a close •ecret.