!!!Völkerbundanleihe

League of Nations Loan: 1) Based on the  Geneva Protocols of 4 
October, 1922, Austria was granted a loan of 650,000,000 gold crowns 
by the governments of Great Britain, France, Italy and Czechoslovakia, 
for which it was obliged to pledge its customs revenues and its 
tobacco monopoly in return. The maturity was fixed at 20 years, the 
bond was issued in 10 different currencies and was floated at 11 
financial centres; net proceeds amounted to 611,000,000 crowns or ATS 
880,000,000, the effective yield varied between 8,6% and 10,2%. The 
loan was used in part to balance the budget deficits of the years 1922 
and 1923, around 50% of net proceeds had to be deposited with foreign 
banks at a rate of 3-4%; however, the interest fell short of the 
amount Austria owed its creditors, which were in some cases the same 
banks the money had been deposited with. The remainder of the loan was 
used by the federal government for productive investment (1924-1927), 
ATS 50,000,000 was used in 1927 to reduce the federal debt with the 
Austrian National Bank. Granting of the loan went hand in hand with 
financial control by the Dutch High Commissioner of the League of 
Nations Council, A. Zimmermann, who carried out this function until 30 
June, 1926. On 1 December, 1934, Austria called in the loan and 
financed the redemption by floating the "Austrian Guaranteed 
Conversion Loan 1934-1959" with a total of ATS 567,000,000 
(1936).

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2) In the Lausanne Protocol of 15 July, 1932, Austria was granted 
another League of Nations loan of ATS 300,000,000 with a maturity of 
20 years (1933-1953). The underwriting countries were Great Britain, 
France, Italy, and Belgium. Austria undertook to renounce the 
annexation and a customs union with Germany. The Dutch controller 
Meinoud Rost van Tonningen was in office until 5 August, 1936. The 
loan passed parliament by 81 : 80 votes. The proceeds of ATS 
306,000,000 that became available in the middle of the year 1933 were 
used to pay off floating foreign debts and to redeem debts of the 
federal government and the Federal Railways with the National Bank.

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Both loans were duly serviced until 1938, in October 1938 service of 
capital and interest service ceased following a redemption offer by 
the German Reich. In a foreign debt agreement concluded in Rome in 
1952, the interest rate for the Conversion Loan 1934-1959 was fixed at 
4,5%, for the remainders from the old loans from 1945-1953 lump sum 
payments were fixed for the period up to 1978, and the remaining loan 
repayments were extended to 1980.

!Literature
H. Kernbauer, E. Maerz and F. Weber, Die wirtschaftliche 
Entwicklung, in: E. Weinzierl and K. Skalnik (eds.), Oesterreich 
1918-1938, vol. 1, 1983; G. Klingenstein, Die Anleihe von 
Lausanne, 1965; K. G. Schogger, in: Mttlg. der Oesterreichischen 
Nationalbank 1995.


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