CO129-555-6 Banking crisis 24-9-1935 - 18-10-1935 — Page 68

Copy.

Crown Agents for the Colonies,

4, Millbank,

Westminster, London, S.W.1.

29th January, 1935.

68

Dear Williams

I see that in my letter of yesterday with

regard to the Palestine Banking Committee, I have omitted to explain the reference to the Currency Board arrange- ments in paragraph 30 of the report.

The arrangement is a very simple one. In the

ordinary way a bank, if it wants money issued to it in

Palestine by the Currency Officer, has to pay the Board sterling in London and cannot get the money in Jerusalem until the Board have telegraphed the receipt of the money in London. To avoid the inconvenience of any delay in

these operations, some of the banks have deposited securities with the Board here covering known sums and the Currency Officer is authorised, in the case of those banks, to meet requisitions for money without waiting for the

telegraphic news of the receipt of the money in London.

The Board do not issue money in exchange for

securities, although this seems to be in a way implied in the report, and although the Board are at liberty to sell the pledged securities if the payment in sterling is not immediately forthcoming; but, as there is no recommendation of the Committee based on the arrangements, there seems to be no need to elaborate the matter.

Yours sincerely,

0.G.R. WILLIAMS, ES:

(Signed) P. Ezechiel