Evening star. [volume] (Washington, D.C.) 1854-1972, 1930-11-29
u. S. DOLLAR LOANS
RAPIDLY REDUCED
Foreign Nations Are Paying
off Obligations Bearing
High Coupons.
BY CHARLES F. sPEARE.

Special Dispatch to The Star.
NEW YORK, November 2e-The an.
nouncement that the government Of
Switzerland will pay of on January /
next the outstanding $4,000 900 Of 9
per cent bonds issued in this country 10
years ago Is in line with the action OF
many European countries in retiring
their dollar obligations before matur-
ity and as rapidly as possible cancelinR
their debts in the United States.
The Swiss per cent bonds were Is.
sued in 1920 at par and are one OF the
few remaining high coupon dollar loans.
They are to be redeemed 10 years be-
fore maturity at premium Of per
cent. 1t is understood that consider.
able portion of the issue has already
been purchased for Swiss account. so
that the payments to the remaining
American holders for these bonds will
be comparatively small.
Danish Loan.
A few days ago the fiscal agents for
the Danish consolidated municipal loan,
guaranteed by the Kingdom of Dem
mark, gave notice to the holders Of this
per cent issue, which would normally
mature in 1916, that they would antici-
pate payment on February l. 1881. At
that time those who bought these bonds
IN 1921 at SO are to receive 1o7l2 for
them.
Not only are dollar loans being taken
up at the earliest possible date under
the callable provisions, but substantial
sinking funds are operating to reduce
the outstanding amounts Of these loans
In this country. Last month Germany
retired another $4,620, 900 block of its
per cent issue, known as the Dawes
loan, bringing the present outstanding
amount of this down to about ST.
100000 from the original American
flotation of $110.000,00O. Next Mon
day the French Republic will pay of
$4,000,000 on its z per cent loan of
1924, thus reducing the original loan
of 500, 100000, placed in 1924 at 81,
to slightly less than $79,000,000. These
bonds are annually redeeme at los.
Italy Reducing Commitments.
The Kingdom of Italy is likewise cut
ting down its loan through the opera
ton CT an annual sinking fund of
81 ,966,200 On Monday it will pay out
this sum to the holders of dollar bonds
that have been drawn by lot. In 1925
Italy issued $500, 900 of per cent
bonds at 9412 and has now reduced
this to about $93,000.00O. On January
l the Kingdom of Belgium is retiring
a block of 81 1862 900 of its per cent
bonds issued in January, 1925, in the
amount Of $50, 600, 900, of which around
SAL 100000 will be outstanding after
the first of next year. A smaller sink
ing fund is operating on the Belgian
per cent bonds, with 1926, 500 to be
redeemed next Monday.
Other sinking flInks which will re-
duce foreign dollar loans materially in
the next few weeks are those Of the
Rheinelbe Union, which is paying OF
$213,000; the Department of Atioqua,
in the Republic of Colombia, and that
of the Hungarian consolidated munich
pal 71a per cent loan, which are both
payable on January !.
New Offerings Few.
Inasmuch as practically no new long
term dollar loans are being negotiated
and only comparatively small short
term credits are being extended by
American bankers to foreign borrow
ers, the anticipation Of payment of
loans like those of Switzerland and
Denmark and the exercise of liberal
sinking fund payments are cutting down
the total amount of foreign loans in
the United States more rapidly than at
any time in the past 10 years. In adj
dition to the reduction through these
operations, the sum of dollar loans
steadily being bought back by the
countries or cities of issue is a large
one. 1t has been increasing, since the
prices of these loans, especially those
of German origin, have given the boz
rowers such an excellent opportunity
to cash them in at anywhere from 10
to 20 points below the prices at which
they we're sold to the American syn
dicates.
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