1939-02-27 — Page 9

* SUPPLEMENTTM

Hongkong Daily Press.

Registered as a Newspaper at the General 報西 ESTABLISHED 1857. 刺孖

Post Office in the United Kingdom.

15-19 Marina House, Queen's Road Central. G.P.O. Box No. 1.

HONGKONG, MONDAY, FEBRUARY 27, 1939.

HONGKONG BANK

BANK HOLDS OWN THROUGH

PERIOD OF

OF DIFFICULTIES

SATISFACTORY REPORT FOR 1938 PRESENTED AT ANNUAL MEETING Chairman Stresses Need For Early Mediation In Far East War

"OUR BALANCE SHEET AND STATEMENT OF ACCOUNTS SHOW THAT IN SPITE OF ALL DIFFICUL- TIES WE HAVE MANAGED TO HOLD OUR OWN, and the measured optimism of last year's. Chairman has proved to be justifled," declared Mr. T. E. Pearce, Chairman of the Board of Directors of the Hongkong and Shanghai Banking Corporation at the annual meeting of the Bank held on Saturday.

The net profit for last year amounted to $15,296,621.32, and for this excellent result the Chairman paid a high tribute to the work of the members of the staff, particularly of the managers and agents stationed at various ports who have had to face difficult problems during the year on account of un- settled conditions.

toms' agreement of last May has not yet been endorsed by the Chiness Government, we are antis-

of their nationals is governed by fled that it did in fact serve a the strict observance of inter-valuaole purpose in alding the national obligations such as the Administration to pass safely Washington Treatles and other through a period dangerous to its International agreements, the al-integrity.

.

teration of which by unilateral Weighty reasons have restrained action will not be considered.

the Chinese Government from JAPANESE ASSURANCES }putting the agreement into effect, - From the Japanese side there but we are sorry that this has not have also been very

done. explicit been

Apart from other' assurances, that Japan will respect things it has meant that no for- to the fullest extent the rights and eign loan quotas have been re- Interests of the Fowers in the mitted from the ports under occupied areas, while leaving "the Japanese control. Moreover, we door wide open," Mr. Hirota used had hopes that some similar these last words on January 22, modus operandi might have been 1938, and similar statements have applied to other difficult questions. been repeated by important Jap-of international concern. anese officials' on numerous occa- In spite of this the payments sions.

[due on Customs loans were main- It is, however, impossible to re-tained without delay or hesitation concile such assurances with the throughout 1933 But early" in trend of developments in North January the Chinese Government and Central China. Our important eventually were driven to the stake in the economic structure of decision that since 80 per cent, of the Far East, naturally makes us the Customs revenue was cut of very anxious that treatles, agree-their hands they could no longer ments and properly authenticated bear the whole burden of finding statements should mean what they the equivalent of some £400,000; say and be carried out with good each month to meet these loan, faith.

requirements. However, no public default has yet taken place and

CHINESE CURRENCY ·

In regard to the currency situa- It may still be avoided, tion in China, you all know how The future of the Customs loans matters stand; that, as in many is bound up with the outcome of other countries, the currency has the present confict, but we feet more than one exchange value, the sure that the Chinese Government In the course of a review of to review at some length in his ocial rate and the open market will do all they can to set matters conditions in China and the speech to shareholders the political, rate, which varies in different parts right, as we believe that the main- Far East generally, Mr. Pearce currency and trade conditions in of Chins owing to restrictions on tenance of their credit through dwelt on the early necessity the Far East. This year the poll- the movements of bank notes. these loans is a matter about of mediation in the Sino- the currency and trade situation so maintained satisfactorily in Shang- pride.",

tical situation is so delicate, and Until March, the exchange was which they take considerable Japanese conflict.

"For mer abnormal, that while making some hat, but when the Federal Reserve chants of all nationalities the references to each of these head-Bank was formed in North China

CUSTOMS INTEGRITY desirability of an early ings I trust you will not be dis- and threatened to undermine the able to record that in spite of Meantime, it is pleasant to ber cessation of hostilities is appointed if I confine my remarks National Currency, a system of manifest, but for millions of in the main to generalities and exchange rationing was introduced. adverse circumstances the Chus desperate people it is of vital leave untouched or pass but light This resulted in operators obtain weather the storms of the past Importance, a matter of life ly over matters about which you ing their exchange requirements

hoped for stronger words or more where they could and and death," said Mr. Pearce.

a "black The Chinese Government's skil-detailed observations.

market" started, which eventually ful management of the currency I am sure you realise how foolish

became the normal open market the it would be for one in my position for Shanghai, as distinct from the whom we and financial situation in country during the year was also to attempt to enlarge on subjects closely rationed official market. favourably commented upon.

The Chairman in his speech

said:-

toms service has been able to

year without any breakdown in its centralised administration -nn-- der one nominal authority in the person of the Inspector-General,

must congratulate

13

which at the moment are both con- As allotments at the official rate just having concluded ten years of troversial and of great political del became more limited, the open post: Notwithstanding the varying icacy. We are of course not in market rate fell away gradually.

to

outstanding service in his arduous

another, Bir

Ladies and Gentlemen-The re- the inner confidences of any Gov-Thus the dollar was at about 104d, conditions of war that have existed port and statement of accounts ernment, and it is obvious that the in the middle of May. A month at one port after having been in your hands for the more I say the more easy will: It later it was down to 8d.. and even- tional staff of Chinese. Japanese, Frederick Maze and his interna- required period, I will, with yourbe for misinterpretations to arise.

tually the lowest point of 7-7/8d. British and some twenty other Our balance sheet and statement was reached early in August. Sup nationalities, have permission, take them as read:

After making full provision for of accounts show that in spite of port was then forthcoming and

throughout all known losses and contingencies. all difficulties we have managed to soon after the tide turned and the shown tactful judgment under the net profits for the year amount hold our own, and the measured rate recovered

unusually * dimcult * conditions. around 81. to $15,298,621.32, to which must be optimism of last year's Chairman Since then the rate has kept More than ever is it of importance added $3,383,004.53 brought forward has proved to be justified. But all reasonably steady and there have that the international nature of of us who have a solid stake in been, comparatively speaking, only the Customs Service should be After deducting. the interim business and trade out here are slight auctuations caused by mill continued and that its impartiality dividend of › £400,000; paid at aware how precarious and change-tary or political developments or vis-a-vis foreign merchifits of 1/2-7/8 and Directors' remunera-able the financial and economic local rumours. At the end of the different nationalities should be, tion, there remains avaliable for outlook must inevitably be so long year not only had flight from the unimpaired. distribution $12,145,172.08 which it as the two great neighbouring currency ceased, but there had

from last year.

To pay a final dividend

of £3 per share (sub-

also

SALT GABELLE

is proposed to allocate as follows:- Eastern countries remain anta- been a fair amount of repatriation I mentioned just now that at

gonistic. The present confict has of funds.

led to an unsatisfactory situation in regard to the main- $7,744,537.82 tenance of the "Open Door" and British rights and Interests in

ject to deduction of income tax) ..... Transfer to Bank Prem-

ises Account Carry forward to New

Account

1,000,000.00 China,

modua

one time we had hopes of the? EXCHANGE DIFFICULTIES": application of some You can read between the lines operandi such as the Customs how difficult and tense a time ex- Agreement to other dimeult ques- change bankers had throughout tigns of international concern. I the first nine months of the year. was thinking of the Salt Adminis-. BRITISH POLICY

Even now there is an ever-present|tration and the railways. 3,400,634.26 There are some who blame our fear of what I may call "external "When the Balt Gabelle was oz-

Home Government for not taking influences. The Tientsin and ranised, at the time of the flota 12,145,172.08 a stronger line of action both here North China exchange market has tion of the Reorganisation Loan. as well as in Europe, I do not, particularly suffered from these there were great hopes that this The figures of our balance sheet however, propose to criticise British external influences" and have again been converted at policy. In times of international outlook there remains under this the Customs Administration and, the new Administration would act like

1/2-7/8, "the same as last year. crisis, freedom of speech and

eloid.p Aurate with with the help of the foreign per- There is very little to say about freedom of the press have their

War-time conditions govern the sonnel insulate the Salt Revenues, the balance sheet, which in total drawbacks, and much harm has in finances of the Chinese Gorem- and the loans secured thereon, shows an expansion of about $20 my opinion been 4e in recentment, but the latter have been from local disturbances, and even. thillions on each side. Excess note times by careless + criticisms, issue has increased by about $10 rumours and the publication of Western provinces and by the fact certain extent the Bait Adminis

assisted by good crops in the more serious" eventualities. To a millions and is met on the other unauthenticated news items. I be that remittances of money from tration in past years succeeded in aide by about a similar increase in fere that recently there has been Chinese residents abroad have doing so, but the Chinese Govern- our holding of Hongkong Govern- more controversy at home than is been remarkably well maintainment have from time to time ment Certificates of Indebtedness. wise and desirable about questions ed. Perhaps I can sum up the effected changes e a result of Among our Liabilities, current as of foreign relations. At any rate, currency and financial situa- which the foreign element has counts have increased around $24 it is abundantly clear that His

among

millions while fixed deposits have Majesty's Government are steadily in China by saying that, been unable to exert those neutral decreased $11 millions while strengthening the nation, while at partly through good fortune, but influences which we would have

Our Assets, cash has the satile time they are freeing more through skilful management, wished

The Salt Revenues of China re- increased $42 millions, Investments their hands and thus becoming has been kept well in hand. $30 millions, while Loans have more prepared to face future events CUSTOMS AGEFEMENT main of great importance and are decreased $13 millions and Billa Re- without embarrassing entangle- We have watched with anxiety a potential security which may be Colvable $45 millions.

menta, pe

the developments taking place in of considerable value in the even- Moreover, the Pawers most in- regard to the Chinese Maritime tual rehabilitation of the country, terested in the Far East have made Customs Administration. Although, if conndence still exists in the ad- their stand clear: that the position the so-called Anglo-Japanese (Cus- ministration,

DELICATE SITUATION

For a good many years it has been the custom for your Chairman

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