✨ Loan Conversion Premiums
THIRD SCHEDULE.
COMPUTATION OF PREMIUMS.
- THE amount of the premium payable on the conversion of any existing securities
shall be equal to the product obtained by multiplying the following factors, namely:—
(a) The difference between one year's interest on the amount of principal secured
by the existing securities at the rate payable thereon immediately before
the date of conversion and one year's interest on the same amount at the rate
payable on the new securities; and
(b) The appropriate factor specified in the Table of Factors hereinafter set out,
according to the period between the date of conversion and the maturity
date of the existing securities.
- For the purpose of computing any such period as is mentioned in paragraph (b)
of the last preceding clause, any fraction of a half-year that is not less than three
months shall be counted as a half-year, and any such fraction that is less than three
months shall not be taken into account.
Table of Factors.
| Period from Date of Conversion to Maturity Date of Existing Securities. | Factor. | Period from Date of Conversion to Maturity Date of Existing Securities. | Factor. |
|---|---|---|---|
| Years. | Years. | ||
| $\frac{1}{2}$ | 0·488998 | $19 \frac{1}{2}$ | 12·891438 |
| 1 | 0·967235 | 20 | 13·096761 |
| $1 \frac{1}{2}$ | 1·434948 | $20 \frac{1}{2}$ | 13·297566 |
| 2 | 1·892370 | 21 | 13·493952 |
| $2 \frac{1}{2}$ | 2·339726 | $21 \frac{1}{2}$ | 13·686017 |
| 3 | 2·777238 | 22 | 13·873855 |
| $3 \frac{1}{2}$ | 3·205123 | $22 \frac{1}{2}$ | 14·057560 |
| 4 | 3·623592 | 23 | 14·237222 |
| $4 \frac{1}{2}$ | 4·032853 | $23 \frac{1}{2}$ | 14·412931 |
| 5 | 4·433108 | 24 | 14·584774 |
| $5 \frac{1}{2}$ | 4·824556 | $24 \frac{1}{2}$ | 14·752835 |
| 6 | 5·207389 | 25 | 14·917198 |
| $6 \frac{1}{2}$ | 5·581799 | $25 \frac{1}{2}$ | 15·077944 |
| 7 | 5·947970 | 26 | 15·235153 |
| $7 \frac{1}{2}$ | 6·306083 | $26 \frac{1}{2}$ | 15·388903 |
| 8 | 6·656316 | 27 | 15·539270 |
| $8 \frac{1}{2}$ | 6·998842 | $27 \frac{1}{2}$ | 15·686327 |
| 9 | 7·333831 | 28 | 15·830149 |
| $9 \frac{1}{2}$ | 7·661448 | $28 \frac{1}{2}$ | 15·970806 |
| 10 | 7·981856 | 29 | 16·108367 |
| $10 \frac{1}{2}$ | 8·295214 | $29 \frac{1}{2}$ | 16·242902 |
| 11 | 8·601676 | 30 | 16·374476 |
| $11 \frac{1}{2}$ | 8·901395 | $30 \frac{1}{2}$ | 16·503155 |
| 12 | 9·194518 | 31 | 16·629003 |
| $12 \frac{1}{2}$ | 9·481191 | $31 \frac{1}{2}$ | 16·752081 |
| 13 | 9·761556 | 32 | 16·872451 |
| $13 \frac{1}{2}$ | 10·035752 | $32 \frac{1}{2}$ | 16·990172 |
| 14 | 10·303914 | 33 | 17·105303 |
| $14 \frac{1}{2}$ | 10·566175 | $33 \frac{1}{2}$ | 17·217900 |
| 15 | 10·822665 | 34 | 17·328020 |
| $15 \frac{1}{2}$ | 11·073511 | $34 \frac{1}{2}$ | 17·435716 |
| 16 | 11·318837 | 35 | 17·541042 |
| $16 \frac{1}{2}$ | 11·558765 | $35 \frac{1}{2}$ | 17·644051 |
| 17 | 11·793413 | 36 | 17·744793 |
| $17 \frac{1}{2}$ | 12·022898 | $36 \frac{1}{2}$ | 17·843319 |
| 18 | 12·247333 | 37 | 17·939676 |
| $18 \frac{1}{2}$ | 12·466829 | $37 \frac{1}{2}$ | 18·033913 |
| 19 | 12·681496 |
Example of Working.
Conversion as from 15th December, 1933, of 6 per cent. securities for £100, maturing
14th January, 1947, into $4 \frac{1}{4}$ per cent. securities.
Interest rate on existing securities (as reduced by Part I of the Act) is $4 \frac{1}{4}$ per
cent. per annum.
£
One year's interest on £100 at existing rate ($4 \frac{1}{4}$ per cent.) is . . . . 4·8
One year's interest on £100 at new rate ($4 \frac{1}{4}$ per cent.) is . . . . 4·25
Difference is . . . . . . . . . . . . . . . . . . . £0·55
Period from date of conversion (15th December, 1933) to existing maturity date
(14th January, 1947) is 13 years 30 days, counted as 13 years.
Factor for 13 years is 9·761556.
£0·55 multiplied by 9·761556 is £5·3688558, or £5 7s. 4d., which is the premium
for £100 of the existing securities.
The premiums on other amounts of existing securities of the same class can be
computed in the same way, or alternatively, by ascertaining £5·3688558 per cent. of the
amount of the principal in each case.
F. D. THOMSON,
Clerk of the Executive Council.
(T. 49/171/6.)
By Authority: G. H. LONEY, Government Printer, Wellington.
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VUW Te Waharoa —
NZ Gazette 1934, No 54
NZLII —
NZ Gazette 1934, No 54
✨ LLM interpretation of page content
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Forms for Loan Conversion under Local Authorities Interest Reduction and Loans Conversion Act, 1932–33
(continued from previous page)
💰 Finance & RevenueLoan Conversion, Debentures, Securities, Local Authorities, Forms, Interest Rates, Premiums, Computation
- F. D. Thomson, Clerk of the Executive Council