B. —13 A.

It should be noted that these figures relate to the registrations during the months of July, 1935, March, 1937, and March, 1938. As these statistics include only new mortgages, the full effect of reductions granted by the Corporation and other mortgagees as variations of existing mortgages is not reflected in the percentages quoted. There were over 28,000 mortgages varied under section 39 of the State Advances Corporation Act, granting a reduction to a net rate of 4j per cent., and it will be apparent that the comparison would be still more favourable were these figures included. 7. Stock and Debentures issued by the Corporation.-—The capital of the Corporation, as distinct from the share capital of £1,000,000 now held by the New Zealand Government, is comprised of stock and debentures issued on various terms. The "B " issue of stock and debentures (guaranteed as to interest and principal by the Government) is still on sale, interest at ?>\ per cent., with currency to Ist June, 1944. From the Balance-sheet, published on page 14, it will be seen that the total securities issued by the Corporation amounted to £41,585,970 as at 31st March, 1938. 8. New Business. —During the past year there has been a steady flow of new loan applications, and, although the Board has given special consideration to loans required for housing and farms, the securities taken cover a wide range both in regard to class and location. With very few exceptions loans have been granted on the table repayment basis on terms ranging from ten years to forty-five years. The shorter terms are adopted for loans on existing buildings the remaining useful life of which is limited, and in other cases the terms are fixed having regard to the nature of the security and the circumstances of the borrowers. Terms of forty years and forty-five years are appropriate for good farm securities where the depreciation factor is not unfavourable. The following summary showing the annual cost per £100 of a loan at the existing rate of 4|- per cent, for the various terms will be interesting. The amount payable includes both interest and principal, and the regular payment of instalments results in the complete repayment of the loan at the expiration of the term: — T e r m Annual Amount payable. Term Annual Amount payable. £ s. d. ' £ s. d. 10 years .. .. 12 6 2 30 years .. .. 516 10 15 years .. ..9 0 2 35 years .. ..586 20 years .. 7 7 10 40 years .. ..526 25 years . . ..6 9 0 45 years . . 4 18 2 An. examination of reports issued by lending institutions overseas discloses that both in regard to rates of interest and manner of repayment the terms offered by the Corporation under its long-term lending policy compare very favourably with those available to borrowers in other countries. The comparative table of loans authorized, which is set out hereunder, gives a useful analysis of the business handled.

New Business. —Statement of Position as at 31st March, 1938.

7

I For Year ended March, For Year ended March, ? ota, \ f T2 CT l° d if', ~ ! 1937 1938 _ August, 1935 to 31st March, 1938. Loans authorized.— Residential — £ £ £ Refinance.. .. .. 1,435 826,649 961 577,190 3,005 1,838,222 Other purposes .. .. 398 272,815 522 319,074 988 695,194 Erection of buildings .. 1,120 789,990 997 824,554 2,532 1,855,871 2,953 1,889,454 2,480 1,720,818 6,525 4,389,287 Farm — Refinance .. .. 974 2,154,195 470 977,120 2,099 4,937,985 Other purposes .. .. 212 342,217 237 306,608 493 697,700 1,186 2,496,412 707 1,283,728 2,592 5,635,685 Total granted .. .. 4,139 4,385,866 3,187 3,004,546 9,117 10,024,972