CO129-605-5 Government loans 4-2-1948 - 8-1-1949 — Page 44

With Mr. Marshall's Compliments.

BCA 7/202/01

al

52126/4/48.

Treasury Chambers,

Great George Street,

S.W.1.

44

18th November, 1948.

·

Dear Portamor

(12)

Thanks for sending me a copy of your letter of 3rd November to Kalvin-Stark about Hong Kong bearer bonds,

Whilst I agree that there is a lot to be mid against the registration of such bonds sa have been issued, I am a little unsasy at the suggestion that we should agree to the further issue of such bonds.

You will no doubt remember that I had some correspondence with Johns (my letter of the 10th February on ECA.7/202/01 about the issue of premium bonds in bearer form, and the general con- clusion was that much an issue would be dangerous unless we could be mtisfied that Trinidad could control the export of such bearer bonds transferfed to non residents and payment of income or capital to residents of Trinidad alone; it seems to me that all these dangers are present in the bearer bonds which have been, or which will be issued in Hong Kong, and I should experience some difficulty in explaining why Hong Kong has been advised differently from Trinidad.

I understand that there are no individual non resident accounts in Hong Kong as we know them, and whilst the interest ani redemption monies of the bearer bonds could be credited freely to the individual accounts, such accounts do not carry the automatic right of transfer. If however Hong Kong refuse go give till exchange for such payments, are they not in effect blocking the interest, etc.? The fact that the dollars could be bought on the free market fear those monies is surely irrelevant,

with

F.J. Fortsmore, Esq.

Bank of Englani.

Threadneedle Street,

E.C.2.

/and we