B.—4a.
I also enclose a narration of the bills, amounting to £442,000, due on Ist March, which, as you are aware, were handed to the Bank of New Zealand as security for advances of the like amount, bearing interest at the rate of 5 per cent, or 1 per cent, above the Bank of England rate when that rate is in excess of 5 per cent. The principal named in the Treasury bills, with interest at the rate of 3id. per cent, per diem, is payable at the offices of the Crown Agents ; and when the bills were handed over, the Bank was authorized to hypothecate or sell them, with the express stipulation, however, that, in the event of such hypothecation or sale, the liability of the colony should not exceed the amount advanced by the Bank, with interest at the rate agreed upon. There is reason to believe that the Bank has parted with at least a portion of the bills, but to what extent, or under what conditions, is not known to the Treasury, no communication on the subject having been received from the Bank. To protect the credit of the colony, it may, therefore, be necessary to provide for the redemption of a part of the bills, and payment of the interest thereon, at the place set forth in the bills themselves. It appears from the latest accounts received from you, that the sums —amounting, as per statement enclosed, to £19,552 —from time to time provided for the payment of interest at 5 per cent, on the Bank advances, have been used only to the extent of £2,500. lam providing by the present mail, a further sum of £6,185, which is included in the bank order enclosed in my letter of even date, making a total sum of £25,735 for this purpose. . Having thus provided you with the necessary bank orders to cover the whole liability of the colony in respect of the advances obtained on security of the Treasury bills, I shall be glad if you will be so good as to communicate with the Bank of New Zealand, with a view to the adjustment and settlement of that liability, taking measures, if necessary, in concert with the Bank, for placing in the hands of the Crown Agents, on 28th February, a sum sufficient to cover the principal and interest of the Treasury bills, if any, disposed of by the Bank. With regard to the proposal advised in my letter of the 6th ultimo, to transmit to you by this mail Treasury bills to be taken up temporarily by the Public Works Fund, and then to be used under an Order in Council as an investment for the sinking funds of the New Zealand loan of 1863, the Public Works Fund being thereby recouped, I may state that that course was proposed prior to the receipt of intelligence of the successful negotiation of the loan ; and as there is now no immediate necessity to take action in the matter, the bills and the necessary order will be forwarded by another opportunity at an early date, as also the authority for the sale of the debentures held on behalf of the Postmaster-General and Public Trustee, the proceeds of which it is proposed in like manner to invest in the Treasury bills referred to. I have, &c, W. Eolleston The Agent-General for New Zealand, London. (for the Colonial Treasurer).
No. 56. The Manages, Bank of New Zealand, to the Seceetaby to the Teeasttey. Sir, — Bank of New Zealand, Wellington, sth January, 1880. I have the honor to acknowledge receipt of your letter No. 1, of the 3rd instant, enclosing draft, at ten days' sight, for £100,000. I have been authorized to purchase it on the same terms I quoted for a demand draft, namely, at par. The amount has been credited to the Public Account. I have, &c, Geoege E. Tolhuest, The Secretary to the Treasury, Wellington. Manager.
No. 57. The Ageft-General to the Colonial Treastjeee. Sib,— 7, Westminster Chambers, London, S.W., 4th December, 1879. I have the honor to state that the sum of £154,000 was obtained on the 29th November ultimo, through the Crown Agents, on security of debentures of the anticipated loan. £150,000 of this advance was required to meet the payment of the Crown Agents' acceptances of a like amount falling due on the Ist instant. The balance, £4,000, stands to credit in the New Zealand Public Account. The advance is repayable on the 15th January next; interest at the rate of 3-j per cent, per annum. I have, &c, Julius Vogel, The Hon. the Colonial Treasurer, Wellington. Agent-General.
No. 58. The Agent-Geneeal to the Peemiee. (Received, 22/1/80.) Premier, New Zealand. Confidential. New Loan in great demand, over five premium. Due to option converting. * thinks Inscribed Stock will go to 95. Conversion can be made very profitable. Pray see Order in Council properly drawn and despatched first mail* Any hitch deplorable. VOGEL, London, 21.
* See 8.-4, No. 10, and its enclosures.
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