The daily telegram. [volume] (Clarksburg, W. Va.) 1901-1926, 1912-04-02
New Orleans Bank Offers to
Lend Six Millions for For
eign Debt Settlement.

WASHINGTON, April 2.-The state
department announced today the
terms Of proposed new loan "a the
government Of Honduras, to be a.
nanced by the whitney Central Trust
q Savings Bank OF New Orleans, in
stead OF by the Morgan group in New
York The department officials claim
that the Objectionable features OF the
Morgan proposition have been eliml-
mated by the Southern bankers and
they are again urging the Senate to
act upon the Honduras loan conven-
tion, which has been before the for
eign relations committee for more
than year.
The offer of a 100000 loan by
the Morgan group recently was with
drawn. The southern bankers, 1t is
announced, have made tender Of a
similar amount under new and rad
ically different contract. They pro-
pose to limit the first issuance OF
bonds to $6,OOO,eOO and will require
of Honduras 100000 year to meet
the service of the loan, as compared
with $45O.OOO a year under the for
Imer contract. The official announces
ment Of the new loan issued today by
the state department says in part:
4, THE southern bankers limit the
fuses of their loan, exclusively to the
refunding of the Honduras foreign
debt and discard the proposals Of
the Morgan group to promote rail-
road building and other internal i'm
provements and to settle internal
debts and claims pending against the
Honduran government.
i 1T was these provisions extending
the uses of the loan beyond the settle
ment Of the foreign debt that aroused
criticism against the Morgan con-
tract, and the southern bankers claim
that in eliminating these features
they have presented terms satisfac-
tory to, Honduras and that acceptance
i Of the loan may be expected.
tTheir optimism as to its final
4 acceptance. however. is based simply
upon the approval given their con-
tract by individual officials OF the
government Of Honduras who have
closely studLd their offer. With tho
general public in Honduras the
southern banke.R find themselves
Handicapped by a widespread pre-
sjudice2 toward loans in any form, and
saSthat this opposition has undoubt-
kedly been augmented by the failures
Fof the Senate to ratify the convention.
If the Senate ratIfies the conyen-
ton and gives to the Whitney con-
tract the tacit approval which such
faction 'A1lplIes, It will, it is declared,
produce wave of reaction I'M Hon
.duras, dissipating the blind prejudice
and paving the way for a sane con-
sideration OF the Whitney contract on
its merits. The opposition in Hon
duras to the loan convention with
the Morgan contract, against which
popular opposition has been aroused,
and with the convention divorced
from that,contract and resubmitted in
connection with new contract in
directly approved by the United States
Senate and Endorsed by many prom
inent officials, in Honduras the bank
ers feel confident of its complete sue
cess.
THE new Offer as described by
Acting Secretary Huntington Wilson,
is for a s6,0OOO0O loan, payable in
forty years with interest at the rate
of five per cent and with sinking
fund after five years of one per cent.
! The bonds are to be secured by the
customs revenue OF Honduras, col
lected, as provided for in the loan
convention, by Americans appointed
by Honduras with the approval of the
President of the United States. Con-
nected with the New Orleans bankers
is the firm of William c. Sheldon and
Company, of New York.
Even before the New York bankers
had withdrawn formally their offer Of
a loan to Honduras, the southern
bankers, convinced Of the impossible
ity of communicating the New York
|
view to making the loan themselves,
Certain of them having large inter-
ests in Honduras, it was essential to
them that that country be put upon
its feet financially, and they offered,
therefore, to advance a loan in &C
cordance with Honduras demands.
limited exclusively to refunding the
foreign debt.