CO129-509-7 Proposed amendments to Hong Kong and Shanghai Banking Corporation 15-2-1928 - 25-9-1928 — Page 22

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"suitable for the purposes of this Bank", which is

"a suggested form for a Bank. (viz. Palmer 13th Ed.

"p.510)."

The Bank would, however, for the above reasons

prefer to retain this Clause as originally drawm.

The Bank are quite agreeable to subsection (6)

of Clause 3 being amended as suggested by the Board of Trade,

namely, by deleting the word "maintain" in the first line and

by inserting the word "undertake" after the word "improve"

in the first line and by the insertion of the words "business

or" after the word "eny" in the second line.

With regard to paragraph 3 (c) of the Treasury

letter, the Bank are of opinion that it is most desirable that

subsections 13 and 14 of Regulation 3 should be retained. They

instruct us to point out that there are no "special relations"

existing between the Bank and the Government of Hong Kong

excepting only that they are the Government's Bankers. The

clauses are designed, not with a view to acquiring franchises

etc., from the Hong Kong Government, but with regard to the

exceptional situation in China. It must be borne in mind

that the Hong Kong and Shanghai Banking Corporation represent

the British Group of the Consortium and are also joint agents

in China for the British and Chinese Corporation and further

that, when anything approaching stability obtains in China,

reconstruction and the development of the resources of the country can only take place with the assistance of foreign

capital.

Should the Bank at any time hereafter be

invited to assist in such reconstruction it would be necessary

for them for the purpose of securing advances which they might

make to obtain securities and safeguards of the nature

indicated in subsections (13) and (14).

Subsection