FEDERAL LOAN TERMS.

Star (Christchurch), Issue 17012, 10 April 1923, Page 8

FEDERAL LOAN TERMS.

A CONVERSION PROPOSAL. By Telegraph—Press Association—Copy right Australian and. N.Z. Cable Association. (Received April 10, 12.10 p.m.) MELBOURNE, April 10. Dr Earl Page has announced the Stock Exchange terms for the Federal loon conversion issue. He explained that the Commonwealth was inviting the holders of five per cent inscribed stock and Treasury bonds, maturing in September, to convert into five per cent stock maturing twenty-five years hence. One pound bonus on each £IOO converted would also be paid, and interest on the conversion loan would be immune from State taxation.

Dr Earl Page added that a loaji of £44.000,000 was floated in 1918 for five years. This period was too short- If it were redeemed in September the unloading of such a big parcel would far exceed.the demand for investment, and consequently would reduce the rates of interest. The tendency throughout the money markets of the world 1 indicated a gradual decline of the rate of interest to 3 per cent, and therefore he suggested that holders would be wise in investing tbe Government securities carrying 5 per cent for a lengthy period.

Critics of the proposal argue that the Government’s terms are niggardly, and that it is taking advantage of the flooding of the market in September to obtain terms which are slightly unfair.