The Gazette 1975

consultative organs that exist within the Coniniuni ,()r tl>at purjx»se. Scanad Eircann — 20 December 1974 I r u s t ^ (Authorised Investments) Order. 1974: Motion. Mr. M I r v u : : , l u o v e ; . J. O'Higgins: 1 . ' «at Seanad Eiroann "i draft: inn approves the following Order Trustee (Authorised Investments) Order, 1974. a PV of which Order in draft has heen laid before the nouse. Minister for Finance (Mr. R. Ryan): The Trustee me ° . n s ed f n v e s t n , t ' n t s ) Act, 1958, defines the invest- nts m which trustees may invest trust funds unless pressly forbidden b v t he instrument, if anv, creating lI,e trust. Minister for Finance may vary the authorised t r ^ e s t m ? n t s *>y order. The primary qualification for sub ,tCC M l v e s t n , e n ts is l , i a t they should be secure, and, ' ^ect, to this, that tliev should give a favourable ,nco »'e to the life tenant. ' h e purpose of the order ljefore the House for to P P roval - is to add Bank of Ireland loan stoT 1991-98 *tocK° '' St ^ r u s t c c Authorised Investments. The loan for W aS ' s s u e d t o r a ' s e additional capital to provide a r , e f u t u re growth of the bank. It will-be repayable 1996*1 , ) C t W e en 3 1 s t March, 1991, and 31st March, j • jn addition to interest at 10 per cent per annum, carries subscription rights to cdpital stock of the Bank ' I r e ' and. The capital stock of the bank has been a c S t ec Security here and in Britain for more than a the 1 V a ' l d t h e 7 p e r c e n t l o a n s t o c k 1 9 8 6 " 9 1 i s s u e d ,)V vest " k ' n 1 9 6 6 W a s a d d e d t o t h e , i st o f Trustee In- * 'uents by the Trustee (Authorised Investments) stock r ' 1 9 6 7 ( S I " N o - 2 8 5 o f 1 9 6 7 ) - T h e n e w l w a n t j la . , s quoted on the stock exchange and I am satisfied tru U - S 3 s u ' t a h l e stock for addition to the authorised stee investments in this country. , e Minister for Finance is obliged under the Act tern" 115 "' 1 d l e f ()P °wing persons in regard to the list 1,S f 3 n ^ o r d e r proposes to make to vary the ^ °f authorised investments — a judge of the High of th* l l o t n i n a t e d by the Chief Justice, the Governor °f tl C e n t r a l B a n k > t , i e Public Trustee, the Chairman of th° B a n k s Standing Committee, the President , p !\ e 1 "corporated Law Societv of Ireland and the conl i Cnt ° f t h e S t ° c k E x c h a n S e ( I r i s h Section). I have pro ° d t l l e s e P 6 " 0 ™ a n d 'ficy , i a v e welcomed the I s a ' a n d raised no objections to the proposed order. "lent" 1 C o n s ' d e r i ng some further widening of the invest- B u i l d . ^ r s of Trustees. I have indicated to the Irish ag e 1118 Societies' Association the financial and man- PriaT^f 1 r c 9 u ' r e i n e n t s that I would regard as appro- a " d th tllC g r a n t i n S °f Trustee Status to the societies ati 0n u a r e a t P r e s e n t being examined by the Associ- i n . " °P e to reach agreement on suitable conditions is d n ^ a r future. The other main area where change funds 16 C o n c e r n s Banks authorised to accept trust ha s b ° n d e P° s i l - Sincc the 1958 Act was passed there Bank* 0 " a considerable increase in the number of i n f 0 , n £ Institutions operating here. There is now Su Perv ,e - a Coni P re l ,c n.sive system of bank licensing and sati s f le L S10 . n u n d t ' r the aegis of the Central Bank. I am 0 "tat, in principle, the list of Banks should be 51

widened subject to a suitable arrangement lieing worked . out to take account of the position of the Central Bank as the banking supervisory authority. I t is my intention also to have a more wide-ranging review of the operation of the 1958 Act to see if there is a need for amending legislation. The Act, in the main, restricts Trustee Investment to fixed interest securities, unless the trust deed provides otherwise. Charity trusts are also governed by separate legislation, the Charities Acts. Gilt-edged securities are less attrac- tive now than in the past due to the erosion of capital values by continuing inflation. As a result the cult of the equity developed, with its prospects of capital appreciation. The sharp fall in share prices on the stock exchange and the difficulties encountered by some well- known firms shows that such investment is not necess- arily the solution to a trustee's problem. In fact holders of Government securities are probably in a somewhat better position than holders of ordinary shares at present. The problem is to find an investment formula that strikes a balance between the need to ensure the security of the trust fund and the provision of a reasonable income to the beneficiary. I am not certain that there is any really satisfactory solution in present economic circumstances. It is a complex subject, which will require close study and there is clearly every reason for proceeding with great caution. I am satisfied that the Bank of Ireland loan stock is a suitable security to be added to the list of author- ised investments and that it is desirable that Trustees should have power to invest trust funds in it. testion put and agreed to. •iiiiiiiiiuiiiiiiiiiiiiiimitnmiiiiiinminuiiwimimniuiiiiiiiiiiiiiiuwiiiniiaiiinfi RENT REVIEWS

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