The herald., 1894-12-08

the importation from the United States
increased 75 per cent. a. against an in
crsase OF only A per cent from other
countries. OF the total importasious
in $4,000. Sc per cent. and in 18o2.9a,
70 per cent wers from the United Ssatss.
OF the total expectations in 1928, 70
per cent we're to our country. With an
nual exports Of $64, 1000 600 and imports
Of ISL, 600. 900 from the United States.
very little. il any thing, has been done to
provide proper banking facilities for
this enormous traffic. II 10 through and
in to Mexican. Spanish, English and
German bankers that American ex-
porters have to make their collections
In Mexico; that American merchants
wishing TO open trade with Mexico have
to apply for advics. etc.; with whom
American invsstors have to place their
funds, and our large importers OF ore,
coffee, ETC., negotiate their drafts. These
latter reach amounts Of which outsiders
have hardly an idea. One American
firm cold to a single concern in Mexico
during 1e92-93 drafts for not less than
IS. .00O, 900 against exports, and during
the same period an American coffee ex>
porter sold to one concern drafts against
his purchases amounting to q. $50. 900.
The banks and bankers OF Mexico have
hardly any relations with the United
States except New York and eventually
San Frsncieco and Chicago. The other
large commercial csntsrs Of the west.
such as St. Louis, Cincinnati aud KAN
sas City. are hardly known to the fiuan-
ciers OF Mexico. 1t would be to the
interest OF these cities. all OF which
manifest desire to do bueiness with
Mexico. to establish good, solid bank
In the metropolis OF that country. Says
Mr.. Crittenden.
AS to the success OF such a bank,
there can hardly exist any reason
able doubt To begin with, no attem pt should
be made to secure from the government any IA
vors or privileges except sucn as can be had for
the mere asking, no obligations being thereby
contracted. Az. for the present at least. the
Mexican government will not give any conces-
sion conveying the right to issue bank notes,
the proposed bank would be classed and op-
Grated as a private banking hous,. The ad-
ministration should be as simple rs possible.
1t is believed that q consulting and supervising g
board OF, say thrse members, and an execut vs
officer, would be suficient. the board to receive
its compensation in proportion to and out of
the profits of the blink. Good Judgment,
promptness fairness and economy could not
fail to secure to the b,nk valuable patronage,
not only from large dealers but from the poorer
aud middle classes of Americans and other for
eigners. saving department could be addsd
to the regular banking business at very little
expense and with every probability of reason
able success.
The present moment 10 especially fa-
vorable for the establishment OF bank
in Mexico with American money, be-
cause OF the high premium on American
dollars. Atthe present rate of exchange.
$500, 900 OF United States currency would
establish bank in Mexico with q cap
ital Of 1000. 200 Mexican dollars which.
for starter, would be sufficient. though
not too much. The ex pense Of installs-
tion would be, say, $4,000; cash re
serve, $190. 600; leaving working cap-
ital OF $S00.000. Suppose deposits rub-
ject to check OF 5000. 900 and time de.
pusits of $500 600. and there is an actual
working capital OF $2.200,000 Out OF
this could be used $1,000. 600 for OK
change bueinsss, equal to, say. $l2 000.-
600 transactions. At 4 OF l per cent
this would net 100000; $1,000 000 for
discounts at 81 per cent. netting $685.
600; 5000 900 for sundrios at, nay, pc.
cent, netting $4,000; commissions
ought to net $4,000 and foreign coin
exchange $1,000, making profits $40 600
-less per cent on time deposits. $l46.-
0o0 The salaries OF manager and other
officsrs, rent and other expenses, would
be about $4,000. leaving net profits
$4,000. This would permit dividend
Of $lOO, 900 and leave a substantial sur.
plus.
1t is to be taken into consideration
that the shareholders in the United
statss would for their investment OF
100000 OF American money receive
81 900, 900 in Mexican money, which. at
the present.rate of exchange, would net
them 10 per cent laid down in this coun.
try. There is hardly any probability
that the premium on gold will go any
higher; neither is it likely that the pre-.
miums will 20 any lower very coon. but
it 10 pro bable that it will 60 lower with
in, cay, two or three years. Suppose it
OF 80 per cent. instead OF nearly 100 as
now. Then dividend OF 100000 Mexi-
can dollara would represent 1879 per
cent On $500. 900 American money and
if the premium should be % per cent,
the profit would be 16 per cent. Only a
few years ago a premium OF 25 per cent
was considered very high. The same
state OF affairs can exist again.