1927-02-26 — Page 8

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China" Mail

HONG KONG, SATURDAY, FEBRUARY 26, 1927.

TRYING TIMES.

Financial Review of China's Problems.

REMARKABLE SIDELIGHTS.

Foreign Trade Grows Despite Civil Wars."

HISTORY IN THE MAKING.

To-day's "Annual Meeting of the Hongkong and Shanghai Bank.

Recent events in China, especially as they affect foreign trade and foreign concerns, formed an important part of the speech made by the Chairman of the Hongkong and Shanghai Banking Corpora- tion, the Hon. Mr. D. G. M. Bernard, at the annual meeting of that great financial institution held in the City Hall at noon to-day.

Referring to the Canton boycott, Mr. Bernard remarked that the effects of the official raising of this had been very limited and British trade remained hampered and handicapped. This organized attack on the British had come at a time when Great Britain was visibly and actively anxious "to play the game" by China.

Heferring to the anti-British agitation in China, the Hon. Mr. Bernard said it was hard to believe that deep in the Chinese con sciousness there was not the knowledge that. Great Britain had been one of China's best friends and that the British were utterly un- deserving of the obloquy heaped upon them.

Mr. Bernard continued: "Perhaps we may cherish a hope that the very extravagance of the campaign will defeat its own ends, when the good sense of the Chinese people has a chance to reassert itself. This remark was greeted with applause.

THOSE PRESENT

Full List of Shareholders at →Meeting.

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say, it is not my good fortune to meet you with such a happy re- ference...

The One Bright Spot.

i

...

It has been considered advis-million, but re-shipments to Lon- able to convert some of the don and India account for Std. Bank's Silver funds into Goid ozs. 14 million of this total. AF Currency, and, as you will have lowlig for these deductions the noticed in the statement of ac- net imports were some. Std., ozs. counte, a transfer of $1,500,000 | 14 million in excess of those of has been made from the Silver | 1926, an indication, confirmed by Reserve Fund to the Sterling. Re-the increased Customs Revenue, serve Fund, bringing the latter that in spite of all obstacles the Rand up to $6,000,000. The trade of China continues to ex- transfer was effected at exchange pand. of 2/1, reducing the Silver Re-

General Strike Lessons, serve Fund by: $14,400,000.

As mentioned in the Reported steady throughout the year at

The London money market rul the balance of the Marine Insur- ance Account, $250,000, has been a somewhat hign level, owing to transferred to Silver Reserve. We the necessity of maintaining the discontinued participating in the Bank of England rate at 5 per insurance on our treasure ahip-cent.. during the whole period. A ments, etc., some time

reduction in the rate would, "no there is no longer any need to

doubt, have been made early in maintain a separate reserve for in- surance purposes.

ago, 50

..

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the year, had it not been for the imminence of labour trouble. This

developed in the short generat which started in the same month, strike in May, and the coas striking: and lasted practically until the end of the year. The general strike disclosed the fact, evident- ly not realised by those who launched it, that Britishers will not stand for an attack on Con- stitutional Government.. The well-organised and effective mea Isures of the British Government

for carrying on essential services backed by the ready response e the best elements of the commu ity to undertake all and any ki of work, was sufficient to courage and smother the att to paralyse the life of the try:

Assets" and Exchange. The rate of exchange at which the Sterling equivalents of our Silver assets and liabilities, and vice versa, ia calcuated is 1/11 against 2/4, 8/8 at the end of 1925, a drop of, approximately 17 per cent, so comparison with the Sterling equivalents of the various items in the 1925 balance sheet is not altogether easy, I would mention, however, that the decrease of approximately £6,000,- 000 in the Sterling equivalent of the total assets and liabilities, as compared with the 1925 balance sheet, is fully accounted for by the lower rate of exchange at which the Sterling equivalents of our Silver assets and liabilities In most countries trade would have been calculated on this oc

Coal Strike Losses, be well nigh impossible under casion. In fact, an analysis of The seven months stopp auch conditions as have been the original items reveals an ex-work in the coal fields wa existing in China during recentpansion of 4 per cent. in the detrimental" to all homes times, and the one bright spot is figures, and not, the contraction tries, and naturally ser the courage and determination that the decline in the Sterling affected the balance of trade with which the Chinese mer-equivalents. would seem to indi instead of being an expo chants, bankers and tillers of the cate.

Great Britain was forced to 1 soil carry on their business, and

port large quantities of coal. occupations, in the face of all dif.

the circumstances, it is somewh.. Mesars, T. E Pearce, Sir Henry ficulties. It is due to their dog

surprising that the adverse move E. Pollock, Leung Yan-po, R. M. gedness that the wheels of com-

ments of gold, were not on a Dyer, F R. Marsh, G. E. Towns,merce, though clogged, keep mov-afraid, rather to hoarding than greater scale, and that the New H G. Hegarty, C. H. Elderidge, ing, and the Customs revenue

York exchange remained so Fong Lang, Ho. Wing, Ho Kom- steadily increases, though the re-

steady throughout the year, es tong. R. A. Dastur, W. E. Van sult is nothing compared to what

pecially as the fall in the prices Eps, Fung Kong-yuen, O. Kitchell, the figures would be under a

of rubber, and jute, compared N. V. A. Croucher, F. W. Staple-peaceful and ordered regime.

with the previous year, were weak: ton, Prof. C. A. Middleton Smith, While the Bank's business is

factors as regards the exchange WE. L. Shenton, H. R. Sturt, Drworld-wide, China is our princi-

position, though to some extent J. H. Sanders, A, McKirdy, P.S.pal field, and your Directora con-

counteracted by the lower price Cassidy, D. J. Lewis, Ho Ki, M.sider themselves fortunate, in

of cotton. J. B. Montargis, E. H. Summers, being able to meet you with such F. M. Crawford, A..A. R. Botelho.a. satisfactory report as the one Dr. F. Lindsay Woods, G. M. now before you. (Applause). Shaw, A. Stevenson, G. G. N. Tin- Profit for the Year.

Those present were the Hon. Mr. D. G. M. Bernard (chairman), the Hon. Mr. A. O. Lang (deputy chairman), Messrs. W. 11. Bell, A. H. Compton, W. L. Pattenden, J. A. Plummer, T. G. Weall, H. P. White, G. M. Young (directors) and Mr. A. H. Barlow (chief manager).

son, Frank Austin, D. V. Steven- The net profit for, the year, in- son, H. Skott, G. B. Layton, Hcluding $3,397,722.76 brought in Hills, G. Murray, H. B. L. Dow-from the last account, amounts to biggin Lo Chung-wan, F. H. $17,555,790.24. Pentycross, C. I. Cooke, D. H. This compares with a net pro Cooper, J. F. Wright, Jr., John fit of $16,846,978.01 for the year Fleming, D. Templeton, George 1925. Deducting the interim divi- Grimble, S. M. Churn, G. Piercy, dend of £3 paid in August, viz. Lo. Cheung-ip, Mrs. D. Templeton, 4480,000, at 2/2, 7/8 $4,286,-. Messrs. J. M. Alves, V. Goulborn,611.63, and $50,000 remuneration A. C. Hynes, C. G. Alabaster K.C., to Directors, the balance available S. W. Ho, E. L. Sim, E. A. Ram, for distribution is $18,219,278.61, A. B. Raworth, A, P. Samy,

CHAIRMAN'S SPEECH.

Tribute to Late Mr. Holyoak's Bervices.

which it is proposed to deal with as follows:r.

A final dividend of £3 per share plus a 'borius of £2 per share (subject to deduction of In- come Tax); amounting. to £800,000 at ex- change of 1/11. 1/2

The Hoarding of Notes. With the exception of Notes in circulation, which are about $7,500,000 higher, due, I am expansion in trade, I don't think there are any items on the balance sheet which call for special com- ment. Net profits are $1,701, 598.41 in excess of those of a year ago, but, on the other hand, it costs us $1,567,469.15 more, at the lower level of exchange, to pro- vide, the usual Sterling dividend and bonus.

Discount Market. Your Directors feel assured that:

Discount rates in London ruled you will cordially endorse their at 4:14 per cent. to 4.% per cent. action in voting the Staff a bonus during the first half of the year, of 10 per cent. on their salaries and between 4.1% per cent. and for the past year. The work has 4. per cent. in the last six been arduous and, from the Chief months. A very prominent (prob- Manager downwards, their reably the most important) feature sponsible duties have been effl-in the Discount Market was the ciently and loyally performed. continuous large demand for (Applause).

first-class 3 m/s mercantile paper" Price of Silver,

by the Continental State Banks. The movements in the price of The supply of such bills was in- silver during. 1926, showed a wide variably too small to meet the de- range compared with recent mand, with the result that Trea years, the difference between the sury Bills, of which there is highest and lowest spot prices, always a large supply, were easily viz.: 31.13/16d. and 241/8d. be obtainable at higher rates than ing 7.11/16d. Up to July, except those current for fine 3 m/s com- for a short period in April when mercial bills. The reason, for the price dipped towards 29d., the this is that most of the Central metal remained fairly steady at Banks of Europe, who carry such over 30d, but the publication of paper, can only hold bills. bearing the report of the Royal Commis two names..

น

sion on Indian Currency, indicat- Considerable, amounts of for- ing amongst other recommenda-eign money have been attracted tions, possible sales of Surplus and retained in London by the $8,170,212.77 Silver Coin in the not distant fu-high rates offered by the Joint ture, had a depressing effect. The Stock Banks for deposits up to six 650,000.00 price, weakening in consequence,months.

-1,000,000,00

1,

The Chairman said:-Gentle- men-Before proceeding with the business of this meeting, I would refer with the deepest regret to the lose we have sustained since we last, met, through the death, Transfer to Silver last May, of our colleague, the

Reserve Fund late

Mr. P. H. Holyoak. Write off Bank Pre-

fell away and on large sales of de. The year ended with reasonably Mr.

mises a/c Holyoak joined the

monetized silver by the Bank of confident expectations that trade Court of Directors in 1918; the and carry, forward

France eventually touched 24, I would improve, and a decline in value of his services as a Director.

to the new a/c.. 3,399,065.84 1/8d. in October, the lowest the Bank rate would not be long of the Bank, including his tenure

quotation for "spot" silver record delayed. of the Office of Chairman · în

$13,219,278.61ed since November, 1915. Buyers 1918, are well known to us all.

Silver Reserve Increase. predominating, however, at the The Colony, po less than the It is a matter of satisfaction to low level reached, the price re Bank, is the poorer for the pass your Directors that, after provid-acted somewhat, and, at the close ing of such a public-spirited and ing for the payment of the usual of business in the London silver dividend and bonus and, as in re market on the last day of the The report and statement of accent years, the reduction of Bank year, spot silver stood at 25d., a counts having been in your hands Premises Account by $1,000,000, gain of 7/8d. on the low quotation for some time, I will follow the the results of the year's working recorded in Octoberz usual procedure and take them as permit them to recommend an read.

increase in the allocation to Silver At our meeting a year ago, Reserve of $150,000, as compared your Chairman expressed the with 1925. hope that, on some future occa- I would add that full provision sion, a successor of his would be has been made for all bad and able to record a year of prosper-doubtful debts, and our Invest ous trade and peaceful activity ments show a satisfactory mar throughout China. Needless to gin on current market prices.

generous man,

Britain's Sound Position, Germany, Belgium and the Continent generally appear to be nearing the end of their gold ac cumulation and, in the absence of any large demand for India, it seems probable that most of the gold arrivals from South Africa will be available for America. China's Silver Imports.

The payment of the British war Of the total World Production debt interest to the United States of silver laat year, which experts of America was effected without put at Std: ozs. 262,000,000, it is any recourse to the gold credits estimated that India absorbed established for use In case of re- Std, oza. 113,000,000, as against cessity Std. ozs. 109,000,000 in 1925. Shipments to China front Europe and America figure at Std; oza; 96

The remittance of theas large amounts in the face of adverse (Continued on Back Page.)