Has team done in the Priscul case? We can easily verify it by getting the articles of association.
It is entirely a question of policy whether a Colonial government should issue; and this may be considered under two heads, which you suggested in discussing 12014.
(a) Is it wise to give facilities for note issue which may become an embarrassment as in the case of the Oriental Bank failure?
(b) Is it fair to the Hongkong & Shanghai Bank, which is allowed a right of issue under certain restrictions, to admit the concurrent authority of another bank without restrictions?
Taking the latter head alone, it seems to be clear that you cannot give special facilities to the new bank. And adopting the recognised policy of the Dept. in regard to note issues, there is no doubt left.
Either the Govt. may simply decline to receive the notes, and this, as you point out, will effectively kill them; or take possession and prohibit note issue within the Colony: but in their case the notes issued prior to such prohibiting law, or their equivalent from time to time, may still be left standing in circulation: this is the English practice.
If, however, it is found to meet the bank's motionably there is always the line to take that the issue will be reserved at the Treasury if placed and supported by securities in the footing of the Hongkong & Shanghai Bank and not Mercantile; and if the limit of $500,000 is made a strict condition, great harm may be avoided.
The comparison of notes to cheques by the Manager is "fallacious," and the suggestion as to inspector of issuing banks is taboo.
But the case to the 25 July dressing mint the condition of forbidding issue of notes without the notification of the S. f. Note Security.