A new Israel Bond Issue to raise $75,000,000 in 1954 for the economic development of the State of Israel, will be floated in the United States soon after April 1st of this year, it was announced today at the close of a two-day leadership conference here of the Israel Bond Organization.
The $75,000,000 issue will be part of a total issue of $350,000,000 to be sold in the next few years to enable Israel to achieve economic independence through the expansion of its industry, agriculture and commerce.
The decision to embark on a new bond effort, to be known as the Development Issue, was made by some 200 community leaders and members of the Board of Governors of the Israel Bond Organization on the basis of the action of the Government of Israel which officially authorized the organization to continue with the sale of Israel Bonds in the United States, Canada, Latin America and other countries where arrangements can be made to market the bonds.
CONFERENCE IN WASHINGTON TO INITIATE PROGRAM
A decision was reached to convene a three-day National Planning Conference in Washington, D. C. on Friday, March 26th to initiate a program for mobilizing Jewish communities to participate fully in the economic expansion of Israel,
The Development Issue, which is to be registered with the Securities and Exchange Commission in Washington, D. C., will consist of 15-year coupon bonds bearing four percent interest per annum and 10-year savings bonds, appreciating 30 percent at maturity. The coupon bonds will be issued in denominations ranging from $500 to $100,000. The savings bonds will begin at $100 and go up to $10,000. A $100 bond issued in 1954 will entitle the holder to a payment of $150 at maturity in 1964. Both principal and interest will be payable in dollars.
Israel Development Bonds will be non-transferable for the first five years. However, purchasers of the new bonds, subject to limitations to be stated, will be eligible to obtain loans on their bonds up to 75 percent of their par value at any time within that period.
Religious, charitable or educational organizations which purchase bonds with funds intended for use in building or construction will have the right to the return of these funds for building or construction purposes at any time they may be needed prior to maturity.
Owners of Development Bonds will be able to convert them into Israel currency at any time for Development Budget investments in Israel or for tourist expenses. A “life insurance” feature of the bonds will enable the heirs or executors of the original purchaser to redeem the bonds at any time within two years after the death of the original purchaser.
Through the first Bond Issue, known as the Independence Bond Issue, subscriptions amounting to more than $161,000,000 were obtained in the campaign that has been carried on since May 1, 1951. The sum of $41,237,100 was obtained in the United States in 1953, bringing to $137,152,000 the total amount of cash realized since the Bond issue was floated here in May, 1951, Collections on unpaid commitments will continue until the end of the sale next May.
600,000 ISRAEL BONDS SOLD IN U.S. SINCE 1951
Julian Venezky, chairman of the executive committee of the Israel Bond Organization, reported that more than 600,000 Israel Bonds were sold in various parts of the United States and Canada since May, 1951, Of the total, $48, 732, 550 was realized in 1951; $47,182,350 in 1952 and $41,237,100 in 1953. “Proceeds from the Israel Bonds were channeled into the economy of the country through the Israel Treasury,” he stated.
Henry Montor, vice president and chief executive of the organization, declared that the decision of the Israel Government to launch a second Bond Issue in the United States in 1954 represented “adoption of a policy of far-reaching importance in the relations between American Jews and the people of Israel.” The wide response by American Jewry to Israel Bonds has demonstrated that Americans have faith in the capacity of the people of Israel to build their new democracy on solid foundations of economic stability, he said.
Pinchas Sapir, Director-General of the Finance Ministry of Israel, who flew here to consult with Israel Bond leaders on their future activities, said that the Israel Government regards the continuation of Israel Bond sales in the United States as “an indispensable factor in the development of our economy.”
“Israel today has the most industrialized economy in the Middle East,” Mr. Sapir said. “More than 120,000 persons were employed in industry, mining and handicrafts in 1953, representing about 22 percent of the total number of gainfully employed. The consumption of electric power for industry increased from 96,900,000 kilowatt-hours in 1949 to 128,500,000 kilowatt-hours in the first nine months of 1953.
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