GOVERNMENT LOAN CONVERSION

Otago Daily Times, Issue 24607, 15 May 1941, Page 6

GOVERNMENT LOAN CONVERSION

An interesting statement by the

Minister of Finance, which we publish this morning has reference to a proposal by the Government to convert domestic loans that are approaching maturity. The rates of interest carried by these loans range from 3 per cent, to 4 per cent., and the conversion loans will be of two categories—a short dated loan at 3 per cent, at par and a long-dated loan at 3£ per cent, at 103. There are loans maturing in the Dominion in the next twelve months to the total amount of £21,538,631, and it is these loans, no doubt, of which a conversion is contemplated. When it is completed the transaction will, as Mr Nash says, be one of the largest conversion operations ever undertaken in the Dominion. Obviously it is" of importance to the Government that this conversion should be made since the effect will be, in the Minister’s words, to “ clear the decks ” of maturing debt for the probable duration of the war, and the terms on which the conversion loans are offered are not unattractive. include a concession to investors who agree to convert, whereby they may stipulate that the whole or any part of their new stock may be available at par for payment of death duties. When the conversion of these maturing loans has been completed the Minister of Finance will have to turn his attention to arrangements for the issue of. a second war loan, and it is to be noted with satisfaction that on this occasion it will be a loan for voluntary subscription.