New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1912-05-24
KUHN-LOEB TO FINANCE
B. R. 7. SUBWAY SYSTEM
will Be Associated with Central
Trust Company and A. N.
Brady Corporations.
HARMONY WITH J. P. MORGAN
But Reports That Profits of Bond
Issues Will Be Pooled Be-
tween Two Groups
Are Denied.

Kuhn, Loeb & Co., it was learned yester-
day, are TO finance the new subway con-
struction Of the Brooklyn Rapid Transit
Company. associated with that banking
house being the Central Trust Company
and various corporations in which Anthony
n Brady, chairman Of the board Of the
Brooklyn Rapid Transit is dominant.
complete understanding exists between
Kuhn, Loeb & co. and the Morgan in
terests, who are to assume the similar
financing obligations in behalf of the In
terborough Rapid Transit Company, but
reports current that the profits of the bond
issues which are to he brought out will be
practically pooled between the two fnan-
cal groups are authoritatively denied.
The understanding runs only to the ex-
tent of making it an assured fact that
there will be no rivalry between the
groups. but rather cooperation, as far as
may he necessary. each party being de-
srous Of the success of the financial oper-
ations Of the other. as Well as its own.
Ever since the Brooklyn Rapid Transit
Company first announced its intention OF
entering the subway field. experimenting
nent that ample financial support had been
guaranteed IL, there has been mystery as
to the identity of the banking interests
upon which il was relying.
There were rumors that the PENNSYLVANIA
Railroad Company which has frequently
been reported as acquiring control OF the
Brooklyn Rapid Transit, was to furnish
the many millions required; the Armour in
terests. Of Chicago were said TO be pre-
pared 10 do the financing, and it was also
reported that the hackers of the company
were the Foss interests in New England.
All of these reports were in turn denied,
and Wall Street finally came back to its
first guess, now proved accurate that
Kuhn, Loeb & Co. and their associates
would arrange for the financing.
Close to the Trust Company.
This suppositon was based upon the fact
that since the entrance Of Jacob n. Schiff,
head Of the house OF Kuhn. Loeb & co,
into the Central Trust Company board two
or three years ago the relation between
the banking firm and the trust company
has been close The Central Trust Com
peny itself is closely identified with the
Brooklyn traction corporation. Of which its
president. James y Wallace. and it's vice
president George W. Dawson. are d.
rectors while James c. Brady, brother Of
Anthony n Brady is a trustee of the
Central Trust Company
II is understood that the lighting cor
porations with which Anthony y. Brady IS
connected will also take part in the Brook
lvn Rapid Transit financing. Among ,hcse
are the Edison Electric Illuminating Com
VII
Corpanv and the Kings County Electric
Light and Power Company, of which ne is
president. and the Peoples Gas Light and
Coke COMPANY OF Chicago. OF which ne ls
vice president.
Timothy 6. Williams, president OF the
Brooklyn Rapid Transit Company has been
spending practically all OF his time in mis-
city during the last two days in confer
ence with Mr.. Brady and other fnanciers,
working out the details Of the plan for
financing the subway construction OF his
COMPANY
None ~ these details have been made
n,h,ic as is the case also with the Inter
boroueb financing. the arrangement for
which was made nearly three months ago
hA,uee, ! p Morgan & Co and President
ShOnts
financing the lnterborough's subway pro-
,r.r,n,e will he the National City Bank
and the First National Bank as was 20
have been expected in view Of their fire.
.ouept association during the last three
years or so in large bond offerings OF
various corporations. The First National
r,.rk srd the Morgan house have for many
Years teen friends. but in the days before
Nat Rank
,,rcngly antagonistic 20 them, just as the
.o-called STANDARD OIL party were s'ioHs
onnonents Of the Morgan party.
Cooperation Replaces Antagonist
X-oy however. cooperation has replaced
.n,sgonisn. and this cooperation, OF
,bicb q recent example was the admission
~ the president and vice-president or the
National city Bank to membership in the
hoard Of the National Bank Of Commerce
hoe been extended beyond the city ana
b.vond the seas, for the two banks ana
p Morgan a. co. constitute three OF the
MANNERS of the American syndicate, which
&c associated with bankers of Great Britain
France. Germany, Russia and Japan In
rho negotiations for the big loan TO the
new Chinese government.
The fourth associate I'm the American
svudIcate is the great international banking
house of Kuhn, Loeb & Co, the head OF
which. Jacob II. Schiff is director or
the National Bank of Commerce, with the
officers Of the National City Bank, OF
which he has long been a director.
The business relations Of Kuhn, Loeb d
Co. with the National city Bank are not
as close as they were a few years ago, but
are understood TO be friendly and the
policy Of that house in It's financial opera
tions has been to act independently OF
the great banks, availing itself chiefly OF
ifs powerful foreign connections
Where cooperation is desirable. however
the two great private banking houses and
the First and City banks cooperate, and
it is not surprise TO Wall Street that
they should be harmcniously undertaking
the financing of the new subways OF the