BORROWING MORE CHEAPLY.
Before the days of extreme cheapness of money, which has been a feature of markets for nearly a year, interest rates had ruled at a high level, with the result that, for the most part, industrial concerns raising fresh capital during the post-War years have bad to pay very high interest rates on Debentures and Preference issues. To protect themselves, however, especially as regards the Debenture issues, many of these concerns reserved the right to redeem at a comparatively early date if they wished to do so. Accordingly, many companies have outstanding Debentures with what is known as optional dates of redemption. In other words, the companies have the right to repay these Debentures at an early date, offering others in their place giving a lower interest yield. Under the terms of the embargo, however, such issues have hitherto- not been permitted, but under the latest Treasury notice the embargo has been removed and it will mean that many indus- trial companies will be able to replace Debentures on which high rates of interest ,re being paid by other obligations carrying lower rates of interest, thereby relieving many com- panies from a part of their heavy fixed charges.
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