The holders of our Notes would not be satisfied to learn that we have securities deposited with the Crown Agents in London, which would ultimately be available for paying my Notes that might be outstanding in event of the Bank being wound up.
At present we are compelled to keep an ample reserve of silver currency in China and the Straits against our Note issue at both places therefore for all practical purposes the large sum of $3,352,960 (500,000 nearly) at present in the hands of the Crown Agents and the Government of Hongkong is literally dead money.
If our Bank Notes were a legal tender it would be otherwise, but as they are not a legal tender, they are payable in coin on demand. It ought to be borne in mind that even if the securities now with the Crown Agents were in Hongkong the position would not be thereby improved, as it would be impossible to realise or raise money on securities in China during a time of pressure.
There is no Bank of England or resident Bank there to whom application could be made for assistance, we should have to depend entirely upon the hard cash in our own Treasuries which is the only reserve to be relied upon under the peculiar circumstances of the place.
We are equally anxious with your Lordships to make our Note issue quite safe, but we submit that the present lock-up of nearly £500,000 is both dangerous and expensive to us, - whether that in the interests of the Note holders as well as of the Bank.
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