The Lancaster news. [volume] (Lancaster, S.C.) 1905-current, 1915-10-01
\ HUGE CREDIT LOAN
HAS BEEN ARRANGED
American Bankers to Float the
$5OO,OOO,OOO Bond Issue
for France and England.
FIVE YEARS AT 5 PER CENT
Country Will be Divided Into Zones.
Small Investors Getting II
Chance.


French financial commissioners an.
nounced tonight that the proposed
credit loan to Great Britain and
France would be $500, 100000 and
French tive-year per cent bonds
offered to the public at 80 and to the
syndicate of underwriters at 90.
1t also was announced that the
bonds would be issued in denomina-
tions as low as 500 and that sub
scribers might pay for them by in
stallments.
The bonds. issued at 80, will yiel'l
approximately " per cent to the
investor. Formation of the syndicat.
has been left to J. p Morgan & Co
and "a large group of American
baplkers and financial houses" At
~ the bonds will be repayable
w" 'vertible into " per
an" S''' Io-French bonds re-
'h' nI..ble from 10 70 90 years there
after by the two governments jointly
and severally.
Sir Henry Darlington Smith, "A
member of the commission. made
public the announcement. Sir Henry
said that an identical statement
would be made public tonight in
Chicago by Lord Reading. chairman
of the commission. who. with three
;e T.
Western bankers there. The state
ment was issued in the name of Lord
Reading
RUSSIA NOT IN 1T.
1t was announced that Russia
would not participate in the loan.
Henry p. Davidson of the firm of
ment on behalf of his firm, which
said that the commission had made
plain that it had determined to
recognize investment conditions in
America
1T proposes to meet these condi-
tons" said the statement, "by issu-
ing an obligation which is without
precedent, namely, the joint and sew
eral promise to pay of Great Britain
and France. To this IT has attached
terms which mean a yield to the in
vestor of about 51. per cent and
carry with them conversion privi-
lege, calculated, upon the return of
normal conditions, to prove of dis
tinct value to the holder OF those
bonds.
The interests of the small inves-
tor are also consulted in the decision
10 issue the bonds in denominations
as low as 500 and to allow subscrib-
ers to make installment payments.
1T is proposed by the commission
that the proceeds of the loan be
handled 80 as in no way to disturb
eur own money markets and to that
end the general plan will be to leave
the cash realized from the bonds on
deposit with banking institutions
which become members of the syndi-
cate throughout the United States.
This proposed loan may. in fact, be
considered as an arrangement made
by American commercial and agricul-
tural interests with their regular Gus
toners to accept deferred payments
covering commodities purchased
TO MEET EXPENSES.
The , per cent margin between
the prices at which the issue will be
offered to the public and the syndi-
cate will reimburse members of the
syndicate, it is contemplated, fol-
their expenses in placing the loaI
on the market.
To bring the offering larges
of its kind ever placed in the United
States before investors Throughout
the entire nation the country will
be divided into districts or zones anC
10 each district there viii be dele
gated a subcommittee Of the syndi
cate managers, composed Of the sub
scribing banks and trust companie
within the districts. Thus at finan
cial centers committee of the bank
in each city or section will have d
rect charge of the work of marketing
the securities among investors resid
ing in their district.
These subcommittees will wor
simultaneously and will report to tn
general syndicate managers, who viii
be located in New York. The Rv
year bonds, principal and interest
will be payable in New York. 1t i