CO129-543-12 Loans for public work 29-3-1933 - 20-12-1933 — Page 103

$

4.927000.

102

Extract from Hausard 11th. May 1933

ANNOUNCEMENTS.

THE HON. COLONIAL TREASURER:-With Your Excellency's permission, I would like to make an announcement regarding Govern- ment Loans. There are two, the 32 per cent. sterling loan of £1,485,733 maturing in 1943 with a sinking fund amounting at present to £904,410, and the Public Works Loan of 1927 amounting to $4,297,000. The latter was issued in two instalments, $3,000,000 at par on 1st November, 1927, and $1,927,000 at a premium of 3 per cent. on the 1st November, 1928, both issues bearing interest at 6 per cent. with a sinking fund of $333,000 per annum, amounting at present to £125,792, designed to amortise the loan on 1st November, 1938. It is with this second loan that I propose to deal to-day.

This loan was issued for the purpose of defraying the cost of certain Public Works and was fully expended by the end of 1931. On the 1st November last, the Government had the right to pay off the loan, but for reasons which it is unnecessary to detail here, it was impossible to do so. These reasons have now been removed and Government proposes to redeem the loan on the 1st August next. Interest will cease on 31st July. Bond-holders however, will be given

the option to convert their holdings into a new loan bearing interest at the rate of 4 per cent. per annum. The new loan will be for an amount not exceeding $4,927,000, and will be known as the Public Works Redemption Loan 1933, interest being payable half yearly on the 1st February and 1st August. In order to give security of tenure to bond-holders, the term of the loan will be for 20 years, Government not taking power to redeem before 1st August, 1953. A sinking fund will be set up at the rate of $3.45 per hundred dollars on the total nominal value. The bonds will be issued in denominations of $1,000 and $5,000 and $10,000 at par, payable to bearer with half yearly interest coupons attached.

As I have already stated, interest on the existing loan will cease on 31st July, 1933. The coupon dated 1st November, 1933, bearing interest for three months only, will be payable on presentation on or after the 1st August, 1933. Bond-holders desiring to exercise their option to convert, must send notice of their election in sufficient time to reach the Hong Kong and Shanghai Banking Corporation in Hong Kong by the 11th July, 1933, after which date the election cannot be recognised without the special sanction of the Colonial Treasurer, which sanction will be only given if the Colonial Treasurer is satisfied that the delay was due solely to the absence of the bond-holder from Hong Kong. The remaining bonds will be redeemed for cash on the 1st August. All bond-holders are requested to send their bonds for conversion or redemption, as the case may be, to the Hong Kong and Shanghai Banking Corporation in Hong Kong as soon as possible.

Full particulars will be embodied in an Ordinance to be published in due course and forms of request for continuance and for redemp- tion will be printed and will be obtainable at the Colonial Treasury and at the offices of the Hong Kong and Shanghai Banking Corpora- tion.