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Sir,
33636
600 AUG 21
GOVERNMENT HOUSE,
HONGKONG. 28th May, 1921.
I have the honour to observe that since the
passing of the Bank Notes Issue Ordinance, No.2 of 1895, many new banks have been established operating in China. Some of these are companies registered under the Hongkong Companies Ordinances and operate here and in China; and others may be formed from time to time and registered under the Hongkong Ordinances.
As the law stands at present there is nothing to prevent a bank registered in Hongkong from issuing notes in China to an unlimited amount. As the fact of registration is to some extent taken by the public as a guarantee of the financial position of such a bank and the security of its note issue, any failure would be likely to have an adverse effect on the prestige
of the British banks in the Colony.
In these circumstances it would appear advisable to extend the scope of Ordinance No.2 of 1895 so as to prohibit the issue of notes outside of the Colony by a banking company registered in Hongkong, and I shall be glad to have your authority to introduce legislation to this effect.
4.
The opportunity has been taken to add a definition of the term "bank note" to make the question of liability clearer,
and to save expressly the rights of the holders of bank notes.
I enclose a draft bill to effect this object.
I have the honour to be,
5.
1
Sir,
Your most obedient humble servant,
:
THE RIGHT HONOURABLE
WINSTON CHURCHILL, M.P.,
&C.
&c..
&c..
7. E. Stabbe
Governor, &c.
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