COLONIAL LOANS IN U.S.A.

Timaru Herald, Volume XCVIII, 20 July 1925, Page 9

COLONIAL LOANS IN U.S.A.

Delight in American Circles

IJ.S.A. STATUS AS CREDITOR

NATION,

By Cable —Press Association —Copyright, Au-traii'.n and N.Z. Cable Association Received July 19, 5.5. p.m.

NEW YORK, July 17

Tlie financial editor of the New York “Times,” commenting on the announcement of the Australian loan, says: “The five per cent, rate which has been obtained, may be considered a tribute to the credit and standing of the Commonwealth. It is the first time a foreign loan has been floated in New York at so low a rate of interest since the war. The hankers place the Australian issue in the same category with Canadian bonds, which are regarded as prime securities here. The loan is another evidence of co-operation between American and British financial interests, to maintain stable conditions, following on the resumption of the gold standard in Britain, and it is expected it Avill be followed by other British Colonial borrowings here, now that the -way has been opened.” The "Times” emphasises the commanding position the United States has attained as a creditor nation since the war. A number of important banking houses in New York and small groups throughout the country will be associated with the Morgan Company in the Australian offering. "The Herald-Tribune” says that the feature which is expected to make the Australian bond issue popular with investors, is that they are not redeemable in less than twentyfive years.

UNCERTAIN AS TO AMOUNT.

BIG SUMS INVOLVED.

By Cable—Dross Association —Copyright. NEW YORK, July 17.

It is reported in banking circles here that the proposed Australian loan will be a Bank of England loan entirely, the Bank of England supervising the issue, while the Morgan Company will take charge of the part sold in the United States. The amount is still in question, but it is estimated that the loan issue will total 125,000,000 dollars, with 100,000,000 dollars placed in the United States, and the remainder in England. The delay in the announcement of flotation is reported to be due to Australians not being entirely agreed on the amount they wish to borrow, and the arrangement through the Bank of England may have made negotiations more complicated. It is believed the loan may be offered early next week. The bonds will be sold at 9 9J. A later message states that the Morgan Company has announced the purchase of 7 5,000,000 dollars worth of gold bonds from the Commonwealth of Australia.

The bonds will have a currency of 30 years at 5 per cent., and will be offered publicly on July 20. Simultaneously an offer of £5,000,000 worth of Australian bonds will be made on the London market.

COMMONWEALTH LOAN UNDERWRITTEN.

SPECIALLY ATTRACTIVE TERMS

By Cable—Press Association—Copi right Australian an t II.Z. Cable AssoclQtion

(Received July 19, 11.5 p.m.) LONDON, July 18

The Commonwealth loan underwriting has been completed. The prospectus will bo advertised on Monday, the list closing on July 22nd, the hast instalment being payable on October 4. A full half year's interest will be paid on January Ist. Though threcquaiters of the total loan will be issued in New York, city circles boro are relieved to learn that the whole transaction has been arranged through London. It is anticipated, in accordance with precedent, that the Now York portion will eventually be absorbed by London.