War Loan 3.5%

hblock21

If your ancestor had a war loan 3.5% (London register). What would that mean for his beliefs, where he stood on things, etc.
I came across it in his probate from 1974.
There is no other info in the probate (when it was bought) except for the value £117.50 (£500 × 23.5).

pedroeibar1

War loans /War Bonds were in sort a loan to the government to support the war effort and on which the govt paid a coupon (interest) in this case 3.5%. Usually there was an element of patriotism in buying them, so the purchaser would be pro Britain and anti Kaiser (unless the deceased had inherited them).

This explains them in more detail

pinkypinky

More suited to H&H - you might get further responses here.

tabbey

hblock21 wrote: »

If your ancestor had a war loan 3.5% (London register). What would that mean for his beliefs, where he stood on things, etc.
I came across it in his probate from 1974.
There is no other info in the probate (when it was bought) except for the value £117.50 (£500 × 23.5).

War Loan and other gilt edged stocks were bought and sold by people on the stock exchange. It would have been a safe investment, a must for most people's portfolio, whether for retirement or the rainy day.

While some of the original purchasers might have been performing their patriotic duty, most just saw it as a safe investment, no different to an Irish gilt. Many stockholders would not care what their stockbrokers arranged, so long as it was safe.

Manach

While most war loans were likely good investments if one's side won, I've read of German civilians post WWI when they invested and then lost their life savings when Germany was defeated.

pedroeibar1

Beat me to it by 2 mins!
See photos here
The German bonds are/were worthless, and so many were printed they have little value as curiosities - a collector might pay a fiver for one.

Del.Monte

I think there was a good deal of patriotism involved and I remember my Grandmother telling me about buying them. This poster was one of many that urged people to buy bonds.

On Dive

I had a job where I saw a lot of old probate papers. It wasn't uncommon to find war bonds in someone's estate. You won't find any information about them in the probate or administration documentation, except their value at the date of death.

Some people bought them out of patriotism others for investment purposes. In times of high interest rates the price of the bond dropped. Low interest rates and the price went up.

Sometimes referred to as perpetual bonds as they had no redemption date at issue, they were redeemed by the British government in recent years.

Peregrinus

hblock21 wrote: »

If your ancestor had a war loan 3.5% (London register). What would that mean for his beliefs, where he stood on things, etc . . .

It doesn't necessarily tell you very much. While marketing them did involve appeals to patriotic sentiment, they could be bought purely as a financial decision - an investment paying a guaranteed 3.5% return indefinitely, backed by the British government (which, at the time, was the finest security available).

All we can really say is that people who bought these bonds didn't have an insurmountable objection to lending money to the British government. Beyond that, they could have been unionist or nationalist, socialist or conservative . . .

If he died in 1974 it's quite possible that he didn't buy this stock, but inherited it himself from one of his ancestors. That would tell us even less about his political stance.

hblock21

Ok thanks for the replies. Here's a little more background on the man. I don't know when they would have been bought but I see from the article which one of the first posters attached said the 3.5 bond was repackaged in 1932 but maybe he bought them before that. FYI he would have been aged 51 in 1932. (He was 94 when he died in 1974)

He joined the DMP for 6 months in 1907.
He led(as per obit) a volunteer branch during the national movement for independence 1912-1913 in South Tipp.
His house was subjected to raids by
the Black & Tans and used as a venue for sittings of the Republican Courts.

Does this still tie into what has already been said?

tabbey

hblock21 wrote: »

Ok thanks for the replies. Here's a little more background on the man. I don't know when they would have been bought but I see from the article which one of the first posters attached said the 3.5 bond was repackaged in 1932 but maybe he bought them before that. FYI he would have been aged 51 in 1932. (He was 94 when he died in 1974)

He joined the DMP for 6 months in 1907.
He led(as per obit) a volunteer branch during the national movement for independence 1912-1913 in South Tipp.
His house was subjected to raids by
the Black & Tans and used as a venue for sittings of the Republican Courts.

Does this still tie into what has already been said?

Like every other stock, it was bought and sold on the stock exchange, the stock he had , could have been traded many times many times before he acquired them.
Whether a person was royalist or republican, War Loan was a regular staple of a balanced portfolio.

Peregrinus

What happened was basically this:

November 1914: UK government issues 3.5% War Loan, repayable at a date to be chosen by the UK government between 1935 and 1928.

June 1915: UK government stops selling 3.5% War Loan and offers 4.5% War Loan instead. Existing holders of the 3.4% loan can convert to the 4.5% loan, and they nearly all do.

January 1917: UK government stops selling the 4.5% loan and offers 5% War Loan instead. This one is repayable at a date chosen by the government any time within 25 years - i.e. by 1942. Again, holders of the existing Loans can convert, and they pretty well all do.

June 1932: UK government exercises its right to repay the War Loan, but they offer holders a choice; they can take the cash, or they can exchange the 5% stock for 3.5% stock, repayable when the UK government chooses, with no time limit.

March 2015: UK government repays outstanding Loan Stock.

The original 3.5% Loan, sold between November 1914 and June 1915 was nearly all converted to 4.5% Loan, and then to 5% Loan; any that was not converted was redeemed by 1928. The 3.5% stock your grandfather held must have dated from the 1932 reissue; he (or someone from whom he later inherited or bought) must have held 5% stock, and chose in 1932 to take 3.5% stock instead of cash. The original purchase of stock would have been between November 1914 and, I think, July 1918, and could have been of 3.5% stock, 4.5% stock or 5% stock.

As Tabbey points out, the stock was freely transferrable so, while you couldn't buy it from the British Government after July 1918, you could buy it from existing holders, and this state of affairs continued right up until March 2015. Your grandfather could have bought the stock from the UK government on issue, or from an existing holder at any time, or he could have inherited it from someone who bought it from the UK government on issue, or from an existing holder at any time.

hblock21

Some very knowledgeable answers here. Thank you. I can now say I have a good understanding about these war loans and why my great grandfather may have held them.