to launch a second promised $20 million bond issue to help pay for capital projects.

Finance Minister the Hon. David Saul, said the bond will be issued along the same lines as one issued for the same amount two years ago.

But he said that his Ministry would wait until the money is needed before the five year paper would be tendered to one of the local banks. He said Government may not need to use the money until the New Year.

"It doesn't make any sense borrowing the money and paying interest on it until you need it,''he said.

Government began discussing the matter with the banks at the end of last year, although no formal bids have yet been invited on who would handle the new issue.

Two years ago, said Dr. Saul, it had been anticipated that the larger banks would split the issue, but after the bids were received, the note was handled by the Bank of Butterfield exclusively. The notes are redeemed after five years with 6.5 percent per annum in interest.

Dr. Saul said it was too early to say under what terms the new notes would be issued.

"It's been our practice to allow Bermudians to borrow government paper.

There's a market for it. There's enough liquidity out there.'' Dr. Saul said the bond issue would in no way affect the increased market for overseas investment or the availability of mortgage money.

The banks bid on such paper by offering to handle the issue for a specific fee.

The Hon. David Saul.