HC Deb 05 July 1933 vol 280 cc325-6
27. Sir NICHOLAS GRATTANDOYLE

asked the Chancellor of the Exchequer whether he will make representations to the German Government that they should retain and use all the defaulted sterling amortisation payments on the 52 per cent. German international loans, London issue, to redeem in marks an equivalent amount of the London issue of the loan held in Germany?

The FINANCIAL SECRETARY to the TREASURY (Mr. Hore-Belisha)

I understand that the method in which the mark payments for amortisation are to be employed has not yet been settled. His Majesty's Government are following this question closely, but it is clearly one that must in the first instance be discussed between the German authorities and representatives of the bondholders.

28. Sir N. GRATTAN-DOYLE

asked the Chancellor of the Exchequer whether the undertaking of good faith which formed part of the contract for the issue of the London tranche of the German 5½ per cent. Young loan was understood by the British representatives, prior to the issue, to be contingent upon any decision of the German Reichsbank about transferring the sterling amount pledged to cover interest and sinking fund; and, if not, will he now protest against what appears to be a breach of good faith to the detriment of British subscribers to the loan?

Mr. HORE-BELISHA

The obligation of the German Government in respect of the 5½ per cent. International Loan is unconditional; it has been decided, after a discussion with representatives of the bondholders, that the interest will continue to be transferred in full, but that sinking fund will for the present only be paid in marks to the credit of the payee in the German Conversion Office. His Majesty's Government trust that transfer of the sinking fund will be resumed as soon as possible, but they have not been approached by the creditors with any request that representations should be made.

Sir ARTHUR MICHAEL SAMUEL

In view of the fact that the contract was unconditional and that the pledge of good faith was given by the German Government, does His Majesty's Government tolerate interference by the Reichsbank in the contract?

Mr. HORE-BELISHA

I have said that His Majesty's Government have not been approached by the creditors with any request that representations should be made.

Sir A. M. SAMUEL

Ought not His Majesty's Government, on behalf of the general body of British investors, to take the initiative in this matter?