Evening star. [volume] (Washington, D.C.) 1854-1972, 1931-09-29
SCANDINAVIA LOAN
ACCOUNT IS LARGE
Countries Off Gold Basis
Have Borrowed $780,
100000 in U. S.
BY CHARLES F. sPEARE.

BY CHARLES F. SPEARE.
Special Dispatch to The Star.
NEW YORK, September 30. - The
scandinavian countries that have now
gone of the gold basis, as measure Of
self protection from the effects of a
similar policy by Great Britain, have
outstanding loans in the United States
in dollar form of approximately
$3.50, 100000.
OF these countries Norway has been
the largest borrower here, with ~
loans approximating $l9O,OoO,Ooo. SWe-
den is second with four loans aggre-
eating $3.50 900. The Danish dol
lar issues total SITS, 100000. There is
only one Swedish government loan,
however. while there are three loans to
the Kingdom of Denmark and four
loans to the Kingdom of Norway.
Recent Prices Of Bonds.
Until a few weeks ago the govern
rnent and municipal Bans OF Scandl-
nayia were classified as among the best
of those that had been negotiated IN
the United States in dollars. The rat
ing of the $50, 100000 Swedish govern
1nent SIS was approximately the same
as that of the SO per cent american
loan to Switzerland, both issues selling
this wear as high as lot. Danish gov
eminent and the Kingdom OF norway
loans we're at about parity ana ootn
at a premium over par. Inc Clty OF
Copenhagen per cent loan, wnlcn
had been refunded when the 51ss vert
called. the latter having been one OF
the first Scandinavian issues in dollar
form to be sold in this country, only
few months ago sold at 10l, which
nIaced it in a class by itself among
ionq-term continental municipal oonds.
Included in the list of Is Danlsn
issues In dollar form were those OF the
government, of cities such as Copen,
hagen, three loans OF the corlsolloaeeo
Ynunicipal type, of which one was guar
anteed by the government, and also
loan to the Mortgage Bank of Denmark,
which had behind it the credit OF the
Kingdom. There were also several loans
tn export companies, to Danish steam
s1ins and to public utilities. The ~
Norwegian loans included five to the
government aggregating Sllo,OOo'OoV'
eight to Norwegian cities, two to mu-~
nicipal banks that were guaranteed py
the kingdom and four to Norwegian
fydroelectric and other public utility
corporations. In addition to the $780,
600 900 direct loan to the Swedish gov
eminent there have been two loans OF
$50 600 900 each to the International
Match CORPORATION and one Of $50,OO0,-
600 to the Kreuger & Toll Co, all opl-
cations of the Swedish Match Co. the
most powerful industrial group In
Sweden.
The first effect of the suspension by
Great Britain of gold payments was
witnessed in Danish dollar bonds,
which had been unsettled earlier in
September from internal conditions and
had reacted considerably prior to Sep
TENDER 81. The action of Denmark in
prohibiting gold exports last week pro
duced heavy liquidation IN this market
of Danish obligations, which have de-
clined to discounts of from 20 to 30
per cent In the case of bonds that pre-
Viously were selling at premium.
Frozen Loans to Germany.
The single Swedish government issue
has gone to a discount OF 80 per cent,
while the international Match bonds
that were quoted at about par last VIM
ter are at discount Of about 40 per
cent. aa
Until yesterday Norwegian govern
nent issues had acted rather better
than those of Denmark or Sweden, but
there have been violent changes in sew
eral of the Norwegian corporation loans
represented in dollar form.
Banking relations by Scandinavia
between London, New York and Berlin.
Scandinavian banks have carried large
balances in the British and American
markets, especially the banks of Sweden.
Sweden has been q negotiator of many
of the tri-partite credits In which Ger
many was the borrower and New York,
London and Stockholm banks were the
lenders. The present difficulties in
Sweden. which her bankers attempted
TO modify by a credit, which both
American and French bankers refused,
are mainly due To her frozen" loans
to Germany. Danish and Norwegian
conditions are more closely tied in with
their foreign trade, which has been af-
fected by the great fall in commodities.
Radical political developments have also
been a disturbing factor, especially in
Denmark. where unemployment this
year has been a serious problem to the
government.
The advance In the rediscount rate
In Norway and Sweden from to 8
per cent follows increases that were
made before the gold suspension by
Great Britain and brings these rates
to level with that now prevailing in
Germany, but 2 per cent higher than
in Great Britain.
Copyright, 1917