to cover the cost of the Tynes Bay incinerator and the school restructuring programme.

And it may need to borrow $20 million to $30 million more, the Finance Minister has said.

Speaking in the House of Assembly on Friday, the Hon. David Saul announced that a 10-year loan had been secured on June 14 from New York-based Rothschild Inc. and its parent company, NM Rothschild and Sons Ltd. of London.

The loan, a "7.59 percent Senior Notes issue in which eight lenders participated'', will come due on June 14, 2004 and "will be used to finance the school restructuring programme and to repay existing loans.'' Those loans were held by the Bermuda Housing Corporation, which was repaid $15 million, and NM Rothschild and Sons, which was owed $40 million and arranged the extension to $75 million.

According to Dr. Saul, a bid which had been put out for the loan attracted numerous foreign banks eager to do business with Bermuda, whose note was "assigned a (high) AA1 rating'' by Moody's Investors Service, an international rating agency.

The rating was based, according to Moody's, "on Bermuda's strong macroeconomic fundamentals, high per capita income, prudent fiscal policies, low debt ratios and stable democratic nature.'' In arranging the loan, Dr. Saul stressed, Government borrowing remained "well within'' the legal limit of $185 million as well as "the guideline which the Government has set for itself, namely ten percent of GDP''.

He said Government is also "currently working to put in place a facility for further borrowing which will be required over the next four or five years as the school restructuring programme progresses''.