YOUNG PLAN LOAN.

Waikato Times, Volume 113, Issue 18946, 16 May 1933, Page 5

YOUNG PLAN LOAN.

GERMANY'S DECISION.

PAYMENT IN PAPER.

United Press Assn.—-Elec. Tel. copyright. LONDON, May L 5.

A message from Basle, Switzerland, states that Germany has intimated to the Bank for International Settlements that she intends to follow the British and American decisions and pay Interest on the Young Plan loan in paper dollars instead of gold. The bank has replied that It cannot recognise the change, which is contrary to Germany’s obligation. The financial Times says City circles take an extremely severe view of Germany’s repudiation. There is, widespread selling of German securities of all description. The- paper adds: “To make interest payments in depreciated currencies cannot be defended and it creates financial distrust.”

On May 8, 1930, a conference of Treasurv experts and Germany and of the six creditor Powers recommended terms for the issue of the first loan to be raised on the security of the unconditional annuities (the German International loan, 1930, commonly termed the Young Plan.) The loan was to total £60,000,000 In capital value but two-thirds only of that sum would represent a mobilisation of reparations, the remainder being used b Y Germany for the development of her Post Office and other publio works. The experts recommended that the load should be Issued at about 95 per cent., to bear Interest at 51 per cent., and to be amortised in 35 years.