CO129-330 - Public Offices - 1905 — Page 238

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10.

The system of issue which I have explained above

we carried out in the case of a Loan of £1,250,000 on behalf of the Government of Sierra Leone. This Loan was issued in the shape of 10 year convertible 4 per cent Debentures and proved a great success. The issue was very speedily carried to a premium and the Debentures now stand at the price of 100 to 102 ex dividend. Conversion into 34 per cent Stock, which is now standing at the price of 984 per cent ex dividend has also been carried out to the extent of £585,308, and there appears to be very little duubt that before the remaining Debentures mature the greater portion of them will have been converted into Stock and that therefore no difficulty will be experienced in dealing with any small amount that may remain outstanding at the end of the ten years.

11.

Experience has therefore proved that the form of issue which I have described is a desirable une. I meets the immediate necessities of the Stock Exchange and the Financial Houses by providing them with a convenient form of security so called floaters against which they can obtain advances with the least possible trouble. At the same time it enables them to offer Stock to any of their clients who as Trustees, or for any other reason, may be unable or unwilling to hold debentures.

12.

That the success in the case of Sierra Leone was not an 18ulated one is proved by the Government of New Zealand having followed our example and issued a Luan in the shape of 4 per cent Debentures convertible into 34 per cent Stuck which also proved a great success, and the A ent General for New Zealand has acknowledged to us privately the benefit which is Government had derived from following our example.

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