The Logan Republican. [volume] (Logan, Utah) 1902-1924, 1915-09-25
'Ns,.lteave Loan
Finds IN Banks
Until Required
From Credit. Discount Is
Allowed Banks
4. Phone z

New York, Sept. 20. Munitions OF
war will not be allowed to block the
proposed big credit loan to Great
Britain and France nor will the $780,
OOO,OO or $500, 100000 to be obtain
ed be locked up at once in a New
York treasure chest, according to
consensus Of opinion today of those
in close touch with negotiations for
raising the money.
Exports of munitions, 1t was es-
timated, constitute considerably less |
than 20 per cent Of the total value |
of American shipments to Great |
Britain and France. Leaving them |
out of the calculations, II provision |
be made for the shipment Of soil pro-
ducts and the chief manufactured ar.
ticles, the exchange situation will,
in the opinion Of the bankers, become
stabilized. 1t would not be difficult
then to find a method of paying for
munitions If 1t were necessary to
adopt a different method, 1t is be-
lieved. Gold or American securities
or both, or even some other method
OF payment, could be arranged.
On this point the Anglo French
commission was said tonight to be
substantially in accord with the
| views OF their American associates.
The commission is reported to have
taken the attitude that their first
task was to stabilize exchange, and
that the matter OF paying for muni-
tions, which was said recently to
have become question of consider
able variance of opinion is to be sub.
ordinated to this.
InstalIment Subscriptions Planned
IL was reported tonight on good
authority that the tentative proposals
now ~ Tor adoption provide for in
stallment subscriptions to the loan on
the part OF the guarantors, such in
stallments to be paid as necessity
arises for the use of funds.
In some quarters it was assumed
that the sum each bank should
pledge would be payable in four equal
instruments, subject to call, and that
bonds would be issued as each in
stallment was paid. In this manner
the commission would avoid the pay
ment of interest on the entire loan
before all the funds were needed.
Another suggestion, said to have
been embodied in the proposals, was
that the money each bank would
guarantee toward the loan should re.
main in the bank guaranteeing 1t UNI
til occasion should arise for its use.
Then, it was said each of the big
system of underwriting banks would
be called upon for its proportionate
amount, using the ratio of the sum
desired to the whole sum as the ba-
sis of the assessment. For instance
should one bank subscribe for ST.
100000 of the bonds, the full amount
would be left in its vaults, 1t was
thought simply being transferred on
its books to the credit Of the loan
syndicate. This having been done,
should 1t be found desirable to have
one fourth Of the entire credit avail
able in New York, the bank would be
called upon to transfer one-fourth of
its subscription to New York or $780,
900. The idea Of tying up the full
amount of the loan at once seemed
to be unattractive to both parties to
the negotiations.
Bankers to Be Paid for Service
Many American bankers We're Of
the opinion that the one-half of
per cent allowed them for their SER
vices would be on that basis for each
year OF the loan. Thus, II the loan
should run FIVE years, 1t was thought,
the banks would obtain the bonds at
81 1-2 or 2 1-2 per cent below par.
Another proposed feature It was
reported, was that the short term
bonds, whether five or ten years,
should include the privilege of con-
version to long term British and
II French government PONDS, paying
1.2 per cent interest at the end of
the short term period. By that time,
It was thought the war would have
passed into history and the long term
bonds, being a first mortgage on
Great Britain and France and having
life of so or 100 years would be
regarded as a prime investment and
would fetch more than par.
In the absence OF official announce
ment, the situation was said to be
encouraging today. In this connec-
ton, 1t was reported, but without con-
frmation, that member OF one of
the chief New York banks OF the so
| .lllnh nrn.G nrnnnn prOmn had made