}
700
The Treasury Chest Officer has accordingly
with the approval of This Board offered to take over
the surplus balances of the Colonial Government, and
to pay for these in sterling in London at 1/16th of
a penny per dollar more than the Hong Kong and
Shanghai Bank's published selling rate, (at which he
etates that the Colonial Government have hitherto, with
rare exceptione, been accustomed to remit).
It is obvious that some such arrangement is
of advantage both to the Colonial Government and to the
Chest, both of which contributed under the old system
to the profits of the Bank in respect of transactions
for which the services of an intermediary are not
necessary.
It appears however that some difficulty has
been experienced in coming to an agreement locally,
and
x
and My Lords would be much obliged if His Grace would
take the matter into consideration, and would ascertain
whether the Government of Hong Kong would be willing to
enter into an agreement with the Treasury Chest Officer
to allow him the first refusal of all balances which
they desire to remit to this country and if so on what
terms.
It is relevant to add that the work of the
Treasury Chests in supplying local currency for the
needs of the Imperial, Naval and Military forces is
carried out at a loss, and that My Lords confidently
assume that the Government of Hong Kong will be
desirous of helping to minimise this loss, so far as
the Hong Kong Chest is concerned, if arrangements can be
made by which they will be able to remit through the
Chest at rates not less favourable than those normally
to be obtained through other channels. There may be
some difficulty in determining the basis of such rates,
since the Bank will (as My Lords understand has already
happened on one occasion) be likely at the present time
to