CO537-(1262-1649) — Page 64

Increase in Liabilities.

Certificates of Indebtedness to be issued –

$102,850,000 @ 1/2 1/125

Increase in Assets.

(1)

Cover to be

provided by the H.K. &S.B.C.

$46,737,805.28 @ 1/3

(11) Notes on hand

£2,921,113

00031

/ continuation.

31

£ 6,347,773

to be taken

over by Fund. $840,000 @ 1/3

52,500

2,973,613

Net Increase in Liabilities.

£

3,374,160

At 31st December 1945 the Fund had a Reserve of £2,139,049, which remains substantially the same today. After the assumption of these liabilities there will be, therefore, a deficit of £1,235,111 on the Fund's Balance Sheet. Against it there would be, to some extent, claims of a problematical value to the amount of £588,139 (89,410,232.11 @ 1/3) against those Chinese banks to whom loans in Hongkong dollars were granted by the Jananese, and £173,052 ($2,768,827.76 @ 1/3) against the Central Bank of China in respect of liabilities discharged through the "Enemy" Banks Liquidation Pool. These claims are too problematical to be brought into the Fund's accounts as asrets.

3. 1945

-

-

On the basis of the Balance Sheet as at 31st December the latest available, owing to delays outside the control of the Committee these transactions would raise the Fund's liabilities to £21,034,957 and its assets to £19,799,846. The percentage of cover or the Hongkong Dollar would therefore be 94.1% only, as against 116.77 in 1941. At the present rate of earning, the cover would be brought up to 100% by the beginning of 1950.

4.

As will be seen from the accounts presented as at 31st December 1945, during the occupation of the Colony grants to the Government of Hongkong were made from the Fund's income to a total of £1,619,823. These grants were made under an Order in Council

/ continued.

2

cms

Ref.:

CO 537/1369

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