1912, Currency Loan - Multilateral

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LETTER OF AGREEMENT FOR ADVANCE UPON CURRENCY LOAN

March 9, 1912.

REPUBLIC OF CHINA.
Office of the President.
Peking, March 9th, 1912.

 

            To E. G. Hillier, Esq., C.M.G., Agent Hongkong & Shanghai Banking Corporation, Monsieur Casenave, Manager, Banque de l’Indo-Chine, E. Cordes Esq., Deutsch-Asiatische Bank, and Willard D. Straight, Esq. Special Representative American Group.

Gentlemen:

            I am in receipt of your letter of today’s date informing me that, having obtained the sanction of your Governments to advance to the Chinese Provisional Government funds for their urgent requirements, as stated in the letter of the 2nd March addressed to you by the Acting-Minister of Finance, your Banks are now prepared to hold at the disposal of the Chinese Provisional Government, against the receipts of the Ministry of Finance, the sum of Shanghai Taels One Million One Hundred Thousand (Shanghai Taels 1,100,000) and I note the arrangements proposed for making this sum available.

            It is understood and agreed:

            1.—That the said advance of Shanghai Taels One Million One Hundred Thousand will be treated in conjunction with the advance of Shanghai Taels 2,000,000 made in Shanghai to the Chinese Provisional Government on the 28th day of February last; and that sterling exchange for the same will be settled by the Banks in Shanghai today.

            2.—That this advance of Shanghai Taels 1,100,000 as in the case of the previous advance of Shanghai Taels 2,000,000 above referred to, will be covered by delivery to the Banks, so soon as arrangements permit, of sterling Treasury Bills bearing date the 9th day of March, 1912, and for such amounts as, after being discounted at a rate to be arranged, shall yield the sterling equivalent of the said advance, the said Treasury Bills to be secured, subject to the existing charges, upon the revenue of the Salt Gabelle.

            3.—That the Banks hold a firm option for the provision of the further monthly requirements of the Chinese Government for the months of March, April, May, June and possibly July and August which the Four Groups have already been requested to finance, against the delivery of additional sterling Treasury Bills on terms to be arranged.

            4.—That in consideration of the assistance rendered by the Groups to China in the present emergency and of their services in supporting her credit on the foreign markets, the Chinese Government assures to the Groups (provided their terms are equally advantageous with those otherwise obtainable) the firm option of undertaking the comprehensive loan for general reorganization purposes already proposed to them, to be floated as soon as possible, and to be applied in the first instance to the redemption of the sterling Treasury Bills aforesaid.

            I hereby confirm the arrangements and conditions above stated, and request you to proceed immediately in accordance therewith.

            I am, Gentlemen,

Yours faithfully,

 (Signed) Yuan Shih-kai.

 (Seal)