A BOROUGH LOAN.

Waipa Post, Volume XVIII, Issue 1008, 19 October 1920, Page 5

A BOROUGH LOAN.

LOCAL DEBENTURES SUGGESTED. INTEREST RATE RAISED. Now that the Government has raised the interest rate which local bodies may pay for loans for public works to 51 per cent., the Te Awamutu Borough Council ‘at last night’s special meeting gave consideration to a proposal to issue debentures locally for the loan of £2500 for the purchase of the war memorial and municipal offices site. Cr. Oliphant introduced the question and reported on the past negotiations. Cr. Spinley urged the issue of debentures locally. There were many people who had small sums for investment and this would he an excellent opportunity for securing the sound and profitable use of the money. Small sums could not be made to earn 51 per cent, readily in the ordinary way, hut these debentures would be quickly- negotiated and the security would be that of the town. 5

Other councillors supported this 1 view, hut the clerk pointed out that there may be a difficulty in arranging for the Public Trustee to act in a loan involving small £25 debentures as the sinking fund commissioner as required by law. Cr. Lawson referred to instances of other debentures being negotiated in lieu of cash in property transactions. These debentures were practically as good as cash but were interest-earn-ing during the term of the loan. A discussion took place as to the, term of the loan and the advisability of seeking to arrange the loan from bankers, other than the Bank' of New Zealand.

It was left to the Mayor to make enquiries and report on certain details at next meeting.