The sun. [volume] (New York [N.Y.]) 1833-1916, 1915-12-26

trafacking with the hunger Of the people.
GOVERNMENT ACTIVE
AGAINST STATE BANKS
Forces Then to Increase Their
Metallic Resources.
Recently the Constitutionalists have
been very active In their campaign
over the republic. According to the
original concessions Of these banks they
were empowered to issue notes for the
amount of twice their special deposits In
| coin and bars Of precious metal to guar
sntee their bills, these special metallic
guarantees being kept intact and apart
from the other funds of the banks.
Not long ago Gen. Carransa Issued n
decree declaring that a special privilege
conceded by Huerta while In power to
all tho State banks to increase their
Issue Of notes TO three times the amount
Of their metallic deposits guaranteeing
same was illegal and that he banks
must within a very short period assigned
them for the purpose Increase their guar
antees in precious metal to half the
amount VI their outstanding notes or re-
duce the latter to twice the amount OF
the guarantee deposit on hand.
This WA a hard blow to the banks Of
the different States. the majority Of
which are capitalized by foreigners and
are considered as perfectly solvent in
stttutions. but are IN \ dificult position
to raise funds all ~ once owing to the
general poverty Of the country and the
sacrifices one must make to realize on
what in normal times would be quick
assets.
A commission headed BY the Sub|Sec-
rotary OF Finance was formed to inNes-
tigate the condition OF the State banks
and declare their concessions forfeited
II they did not fulnl the conditions OF
Gen. Carransa's decree within the term
specified. which already has expired.
The committee. which still Ia continuing
it's Investigation. Is taking into cOnsid-
GRAFTON other matters thar the guarantee
deposits for the outstanding bills. accord
ing to Official statements.
Able to Pay obligations.
Tit hrst bank whose concession was
declared forfeited by the commission
was the Banco Peninsular de Yucatan
Of Merida, a French concern. which In
general business circles is considered
, As In very good condition and perfectly
able to fulnl all its obligations II given
reasonable time.
This belief has been attested all along
BY the premium put upon the notes OF
the Merida bank. a. yell as those OF
the other state institutions. over those
Of the revolutionary factions. the notes
Of tina bank not having deprecated In
the quotations Of the local market In
spite OF The declaration Of the forfeiture
Of the concession. The French manage
ment of the Banco P~eninsular. immedi'
ately upon it's concession being declared
. forfeited. began energetic diplomatic ne
J gotiattons which had the effect Of dis
! concerning the authorities considerably
: However. they went on investigating thu
; State banks and shortly afterward de
!. clared forfeited the concessions Of thu
I banks of Guerrero. Hidalgo and Quere
taro.
The Banco Nacional de Mexico. whic,
was Investigated also. was declared Il
be in excellent condition In every way
n hand to issue legally another 80. 000. 00'
pesos worth Of notes. II II so wished.
The Banco de Londres y Mexico wa
: advertised by the authorities as beini
= In a fairly satisfactory way and the!
v themselves admitted that they meant t
y enter into y combination with those tw,
v institutions TO get them to form wit
~ tn6lT rTcTCU Cdpltdi liz uuCl0uS OI IN
new Federal bank Of issue planned b
Carransa to be the sole institution au
thorized to issue notes IN tho republic
admitting At the same time that the
y meant to eliminate the State banks O
have them also enter into the combina
ton to form tho Federal bank.
n The general belief Of business mon /,
y Mexico now IN that t1se prsssur
brought to hear upon the State bank
l. L. --- A.
but a to force them to enter int
being for the administration to utiliz
y their foreign capital to form the FEEDERS
Bank and later supplant II. becomin
= the sole owner Of tho institution. Thy
y the untfication Of tho paper money no
> In circulation couid be secured and IN
= administrator could reap considsrabl
" profits from being the sole issuer
notes in the republic.
Foreign Capital Hostile.
Tho attitude Of the foreign capiti
70 Invested in the state banks Is open
u hostile to the administration, howeve
! on account Of the cOercive measures Il
= latter has adopted TO make them ent,
m into it's financial combination. and sc,
eral Of their principal capltalizers wi
n nave DftU lHtCTN lew GU III tue CITY
IN Mexico say that they will fight out Il
matter through all diplomatic and leg
i. channels before they will forego Il
rights conceded them by their conce
sions.
Owners Of the bank Of Hidalgo, Br
- ishers. II IL understood. will lead ii
u night for the State banks. which a
holding . well together. The +
dalgo Banks notes are quoted on a p
with those Of the Banco Nacional at I
present time, not having been affect
n. by the declaration OF forfeiture OF
concession. Thai u to say they
Of worth three to one. n compared wi
re the circulating notes Of tho Constit
NJ. tiOnalist administration.
ar The bank recently advertised 10 q
change Banco Nacionai notes for
q own notes on . par for any one desiri
'r- to mako such an exchange. II hand
cd tho rich British and American mini
interests Of the Paohuca region and
10. considered to bs b sn0allonA Ou1ikl