Peking, July 30.
The Chinese Bankers Association is now involved in an unpleasant debate with the recently revived Banque Industrielle de Chine over the redemption of the bank notes which five Chinese-banks in Peking cashed for the Banque Industrielle after the latter's collapse in July, 1921.
According to local Chinese accounts, when the Banque Industrielle collapsed the French authorities approached the Chinese bankers and asked them to save the outstanding notes from depreciation by cashing them. The Bankers Association agreed to do this as an act of bankers' fellowship and delegated five banks to accept and cash the notes. During subsequent months they took and redeemed at face value notes 10 the total amount of $2,090,000, which they have been holding without interest charges ever since.
When the Banque Industrielle reopened in February of this year the Chinese bankers promptly entered a claim for the redemption of these notes. According to some accounts the Banque Industrielle agreed to redeem the notes with Banque Industrielle 23-year gold bonds bearing five per cent. interest, which thz French Government was pledged to buy in at face value upon demand. According to other accounts the French said that this debt was not redeemable in any form until the "gold franc issue" was settled, because until this was settled the Banque Industrielle would have no conception of its available resources.
The Chinese bankers claim that this account for the redemption of notes cashed is a debt of honour having nothing to do with any other issue. which the Banque Industrielle was bound to discharge as soon as it opened its doors. They argue that the Banque's disputes and misunderstandings with the Chinese Government have nothing whatever to do with this fundamental obligation. They say that their redemption of the notes was virtually an act of charity, that five banks are carrying an unproductive credit of $2,090,000, which is a large sum for Peking banks, and that they are at least entitled to cash redemption if to no interest.
Text read from the printed page and cleaned; old type leaves the occasional error.