LOAN CONVERSION.

Wairarapa Age, 15 March 1933, Page 5

LOAN CONVERSION.

NO FEAR OF CAPITAL BEING TIED UP. POSITION OF THE SMALL INVESTOB. STATEMENT BY MINISTER OF FINANCE. (By Telegraph.—“ The Age” Special.) WELLINGTON, March 14. The attitude of these bondholders who have been unwEi ag to accept conversion on account of the alteration of maturity dates involved in the Government’s scheme was discussed to-night by the Minister of Finance (the Rt. Hon. J. G. Coates) when he announced the receipt of applications and promises to convert covering £31,826,472 of the total internal debt of £69,514,000 held by the public. A large part of the amount outstanding represents securities held by small investors, and the Minister has reason to believe that many of these are holding back simply because they fear that to convert their stock will prevent them from realising on it when they wish to. “The fact that the conversion scheme has brought no fall, but rather an appreciation, in the market value of Government stocks in New Zealand should be a complete answer to these bondholders,” said Mr. Coates. “At the preesnt time, the principal Government loans are maturing at dates extending from August, 1933, to February, 1951, and holders are being asked, upon conversion of their securities, to accept later maturity dates, ranging from January, 1940, to June, 1955. To those people who have invested in stock maturing before 1940 and who fear that the scheme may tie up their money and embarrass them when they most need it, I would say merely that Government securities arc marketable and more readily marketable than most securities at the present day. Even under the most unsettling 'conditions when conversion is actually in progress these securities have fully maintained their values and it is plain that bondholders who wish to realise on their holdings may do so easily, and at any tune, through the agency of the Stoek Exchange. ’ ’ The‘Minister briefly recalled the conditions of the Australian conversion two years ago. Before and after that conversion, Commonwealth stock had fallen to £BO and less. Yet to-day even with so much leeway to make up’ it had virtually recovered its ™ r of face value. New Zealand Government loans were now being bought on the marxet at the same, or better prices or ® conversion was proposed, so that in the Dominion’s ease there was even less reason for bondholders to tear the loss of capital. “Force of circumstances has necessitated a re”£‘i OI k Of intercst >” ed'led Mr. Coates . here 18 Indication whatevw that anyone will suffer a reduction of capital. I mnst appeal t 0 the ““ r L l their fcars on one sid e and help their country, as a great majority of the larger holders havTS ready done, by agreeing to convert. fhLT * * r l ■ assure d that whenever 1 ' capital, they will be able to realise it on the stock market almost certainly without loss and possibly with profit.”