CONSOLIDATION OE THE LOANS OE NEW ZEALAND.

B.—No. 3,

9

Tou will also observe that I have not limited the time in which debentures may be offered for exchange, so as to admit of their being sent in from time to time, until the whole or some large proportion shall have been converted. It will, however, after some time be necessary to modify the rates of exchange now offered, as these rates would be too favourable to holders of the present bonds as the time approaches in which the currency of the old bonds expires. For the same reason, no notice has been issued with respect to the bonds of Otago which matured on the 31st of December last, or the 8 and 10 per cent, bonds of Nelson which mature on the Ist of July in this year. I have, &c, E. W. Staeeoed. Messrs Julyan and Sargeaunt, Crown Agents for the Colonies, London.

Enclosure in No. 3. Continued Conversion of the Old Debentures of the General and Provincial Governments of New Zealand into new 5 per cent. Consols under the Loan Act of 1867. The Crown Agent for the Colonies, acting on behalf of the Government of New Zealand, will be prepared to exchange new 5 per cents., created under authority of the Act above referred to, for debentures bearing various rates of interest, which have from time to time been issued under the following Acts and Ordinances. The interest on the new securities will be paid quarterly, and the principal will be paid at par by a 1 per cent, cumulative sinking fund, applied by annual drawings to the extinction of the debt. By this process the whole amount will be paid off in about thirty-six years. The terms on which the old debentures may be exchanged for new are as follows, viz. : — For every 100 General Government old 5 per cents, payable in 1914, holders may receive 99J new 5 per cent, consols. For every 100 General Government 6 per cents, payable in 1891, holders may receive new 5 per cents. For every 100 6 per cents, of the Provincial Governments of Auckland, Canterbury, and Otago, holders may receive 109 new 5 per cents. For every 100 Otago 8 per cents., issued under Loan Ordinance, 1861-2, and payable in December, 1875, holders may receive 115 new 5 per cents. For every 100 Otago 8 per cents., issued under Loan Ordinance, 1861-2, and payable in July, 1874, holders may receive 113 new 5 per cents. For every 100 Otago 8 per cents., issued under Loan Ordinance, 1862, and payable in November, 1874, holders may receive 113J new 5 per cents. For every 100 Otago 8 per cents., issued under Loan Ordinance, 1862, and payable in October, 1875, holders may receive 115 new 5 per cents. For every 100 Canterbury 8 per cents., issued under Loan Ordinance, 1856, and payable in 1873, holders may receive HOJ new 5 per cents. For every 100 Wellington 8 per cents., issued under Loan Ordinance, 1862, and payable in 1877, holders may receive 118 new 5 per cents. For every £100 Wellington 8 per cents., issued under Loan Ordinance, 1866, and payable in 1886, holders may receive £128 10s. new 5 per cents. For every 100 Nelson 8 per cents., issued under Loan Ordinance, 1864, and payable in 1876, holders may receive new 5 per cents. For every 100 Nelson 8 per cents., issued under Loan Ordinance, 1864, and payable in 1881, holders may receive 124 new 5 per cents. The bonds will be made to represent sums of £1,000, £500, £200, and £100 respectively, and fractions of the latter amount, which may be unavoidable in the conversion, will be adjusted either by the issue of one bond, more or less, and by the payment of the difference in money, at the time of conversion. The annual drawings will take place in the month of March, commencing in 1869, and will be conducted in the presence of the Crown Agents for the Colonies, of any debenture-holders who may be pleased to attend, and of a notary public. The debentures drawn will be paid off at par, on the 15th April following, together with the interest due thereon. The days on which such drawings are to take place, and the numbers and values of the debentures drawn, will be duly notified by advertisement in the London Gazette and the Times. The New Zealand Government will receive bonds for exchange, and will give an order on the Crown Agents for an amount of new 5 per cent, consols corresponding with the advertised terms of conversion. The Government will be responsible for the transmission of the old bonds to England. As payment of interest on new bonds has to be made in London, and the annual drawings will also be made there, those bonds will have to be deposited in the hands of some person resident in the United Kingdom. For the convenience of persons who have not agents there, Mr. Morrison, the New Zealand Agent in London, will, on application, act as agent for such persons in respect of those bonds. E. W. Staeeoed. The Treasury, Wellington, New Zealand, 6th February, 1869.

No. 4. Messrs. Julyan and Saegeaunt to the Hon. E. W. Staeeoed. Offices of the Crown Agents for the Colonies, g IE Spring Gardens, London, S.W., 29th January, 1869. I have the honor to enclose for your information copy of a report, and its enclosures, made by 3

Jan. 16,1869. Vide B. No. 4, pp. 11-29.