New-York tribune., 1903-01-21

pelago. and for other necessary preliminary ex-
penses whereby the capital will be reduced 10
S9SO9oOg0 which at Der cent interest would
produce annual income of So,93Ooco instead
Of the S4,oo0ooo which would have been the tne
income from the entire capital of SloO,oOo'oo,
that the annual income@is SSoe0O gold less
by reason of the above mentioned S2Oo0Un
SubtraCting from the annual income Of So,S@o-
oto the annual expenses for salaries ana olieI
necessary expenses of the bank, which may oe
reckoned at bout S1e0,ora. there would remain
a net annual income Of %3--OopO, Wnlcn, aoueu
TO the capital compound interest, under the
same conditions during the following years, at
the end of sixteen years would free both the
actual capital and the supplementary credlt;
that is the bank would have liquidated its dept
TO the United States Treasury, and there would
remain a balance of at least S4O,OoO,oco tor
the continuance of its work But, as 1t Is DIM
cult to make a given date by which all the
capital would get into circulation, II would oe
necessary TO allow another term OF tour SeaiS
for this purpose, and thus as We said ABOVE
il would be at the end of twenty years tnat the
debt contracted against the United States treas
ury would be cancelled
Let US suppose that in the first two years the
hank does not discharge its functions very
wei. and only employs in its business one-fourth
Of the capital, that is, S2o,OoO0o0; then we
should obtain, subtracting the SIooooo Tor an
nual expenses from the interest at per cent:
which would be S1,000OOo, a net remainder OF
100000, which in two years would amount u
100000.
Furthermore. supposing that in the two fol-
lowing years the bank only circulated half the
total capital of S500e000 this would bring IN
100000 at 4 per cent interest, which WonIo
100000 net annually, and in the two years
s., 600 000 which added TO the income OF the hrSt
two years, would give a product OF s5'ZooO
for the first four years. Observe that IN tnls
calculation I have assumed the employment
Of the minimum amount Of capital ana lnS
maximum Of time and expenses. In the fol-
loving wear that is to saw the fifth of the estab-
lishment of the bank, the mobilization OF all the
capital would be assured On this basis nave
proposed the term Of twenty years for the re-
payment OF the cash loan and the cancellation
OF the credit: that at the end or ten years
after taking the capital from the United states
Treasury the amount OF the cred1t Wouia e oe
diminished by S25 0o00 900; at the end Of fifteen
years the S20OO0oe0 in cash would be repaid
and the credit diminished by S5NoceO more
and at the end of twenty years the remaining
S500o0.o00 would be cancelled and the oeot
would be completely extinguished
By the time that the United States Treasury
has been repaid at the end Of the stated period
Of twenty years the Philippine Treasury would
have at least S3o0oootO, which would serve 70
guarantee the issue Of paper money TO that
amount. When the bank has freed itself from
the above mentioned loan the Philippine Treas
Ilry. in order that the operation ana clrculatlon
Of the existing capital shall not be interrupted
viii guarantee in this new period the rest or the
paper ronev issued-that is 10 say, the amount
issued over and above The cash capital which IS
the hest profit Of the bank.
But in case Fiipinos. then favored in their
fortunes, should wish 10 acquire the bank by
making Of il joint stock company, WlIhoul
otherwise altering its organization ana n1eChooS'
the government would conceoe 20 II mem Lci rre
title, without prejudice to its right TO require
repavnent Of the amounts incurred by the
foundation of said bank other necessary ex-
penses And in case the Filipinos had not suf1l-
cient capital to cover the value of the paper
money the government would also guarantee
thi. value so long the sum necessary Tor TINS
guarantee was lacking, but this would not pre-
vent the shareholders from obtaining the dlvi-
dend corresponding TO the guaranteed value rep
resented by shares belonging to the treasury OF
the government and indorsed in its favor
Here. then. is the calculation made upon the
basis Of a apital of S1O0,000,000 gold. which l
believe would be small in proportion TO the Ce-
mand for loans, if We consider that the pan
will grow and will certainly give satisfactory re-
suits since the Philippine agr1cutuT1st asks ana
hores for nothing more than means 10 faclLi-
tate and extend profitable rural labor on a ricn
domain which offers 10 all the opportunities OF
wealth which il contains. The government
with its clear intelligence, will know ana wish
70 understand how far reaching VIII be the pen
e47ts of this modest project, which, II II were
allied would Danish from the minds OF the
neople their fears Of the powerful syndicates'
even II these latter should come 10 esLaDIIsI
themselves in the country, and am almost sure
-rar II would contribute materially toward nor
Mailing conditions in the archlpeIsgo anu anu
would make more stable the so much longed Tor
peace which however powerful these may pc
will be difficult n assure by the force OF arms