FINANCE FOR FARMERS.
MAIN FEATURES OF LEGISLATION. Mr W. Downie Stewart (Minister of Finance), in announcing the initial issue to the public in New Zealand of bonds under the Rural Advances Act, 1926. directs attention to the main features of the legislation governing the issue, which is to provide funds for financing farmers on the long term instalment mortgage system.
As recommended in the report of the Royal Commission on Rural Credits, the bonds are by statute secured on the assets of the rural advances branch of the State Advances Office, which assets embrace all first mortgages in respect of loans granted under the Act, and the bonds are not chargeable on the public revenues of the Dominion.
An important provision for investors is that the principal moneys secured by the bonds and all interest accruing in respect thereof are, in the first place, by section 8 of the Rural Advances Act, 1926, made payable out of the Consolidated Fund, and are recoverable in terms of the Act mentioned from the rural advances branch account of the State Advances Office.
Finance for the initial loans granted to applicants under the scheme has been provided from departmental sources, and the impending issue of bonds will be more than covered by way of security in the aggregate value of first mortgages duly registered and certified as held by the State Advances superintendent. For the information of investors, the Minister draws attention to the ample margin of security over moneys advanced, loans being granted up to two-thirds only of the Government valuation; and by reason of the instalment system of repayment the margin is proportionately increasing throughout th e currency of the advance made to the mortgagor. Thus, holders of bonds issued by the State Advances superintendent under the Rural Advances Act, 1926, which securities are counter-signed by the Secretary to the Treasury as being covered by mortgages duly registered and held, should have a readily realisable investment.
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Otago Witness, Issue 3859, 28 February 1928, Page 13
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325FINANCE FOR FARMERS. Otago Witness, Issue 3859, 28 February 1928, Page 13
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