-"",--
0
419
Managers of the other Hongkong Banks of Issue and ascertain-
ed their views on this matter. It appears, however, that
the Charters of their Banks do not allow of the issue of
One Dollar Notes, nor is there any reasonable probability
that they will be so modified as to allow of it. Moreover
the Shareholders of these Banks have no special liability
with regard to their Note Issue.
8. As to the security offered by the Hongkong and
Shanghai Bank over and above the Reserve alluded to, it is
only necessary to say that the paid-up capital is
$7,500,000, the Shareholders being liable to an equal
amount. The reserve funds are $4,800,000, and with regard
to Note circulation the Shareholders are unlimitedly liable
the claims of note-holders being made, by Ordinance, a
first charge upon them. The Section is as follows:-
"The Shareholders of the Company shall be subject to unlimited liability in respect of all or any such iqsues
or issue of Bills or Notes, and in case the general assets of the Company are, in the event of the Company being wound up, insufficient to satisfy the claims of both the Note- holders and the general Creditors, then the Shareholders of the Company, after satisfying the remaining demands of the Note-holders, shall be liable to contribute towards payment of the debts of the general Creditors a sum equal to the amount received by the Note-holders out of the general assets of the Company*.
The Hongkong and Shanghai Bank Ordinance, Amendment Ordin-
ance, No.21 of 1882. Section 12.
9. The objection commonly raised against the issue
of notes of small value that they fall into the hands of
large classes of ignorant persons, peculiarly liable to
panic is not of much force here, as experience shews that
One Dollar Notes are hold by shrewd and calculating Chinese
particularly well able to take care of themselves, and
moreover there is no likelihood of the circulation attain-
ing any dangerous extent (see paragraph 2).
10.
Under all the circumstances therefore, the
Committee