New-York tribune., 1919-07-31
Govt Approves
Sale of French
Treasury Bills
]. p. Morgan & Co. to Place
$5O,OOO,OOO of Short
Notes Here to Sup.
port Franc Exchange

Treasury bills of the French Republic
to a total of s50,OO0OOO are to be Of
fered in this market shortly by J. P.
Morgan e. Co. with the approval of the
Treasury Department at Washington.
This announcement, made yesterday by
the head of the international banking
firm, was regarded in the financial dis
since the signing of the peace treaty
toward bolstering up the weakened
French exchange rate.
The method adopted for offering the
French Treasury bills here is similar
to that followed in the sale Of British
Treasury bills in the American market
by the Morgan firm over the past two
years. This is explained in the Of
fetal announcement of the bankers,
which said:
"The Treasury Of the French Re-
public has completed arrangements for
the handling of it's sixty and ninety
day bills in the American market
along lines similar to the sale of the
British Treasury bills, which have been
current in this market for the last two
years.
$5,OOO,OO0 Weekly Maximum
y
contemplates the issuance Of its bills
not to exceed $4,000, 600, with a maxi
mum weekly maturity of not over
$5,000,O00. The rate at which the bills
will be sold will depend upon money
market conditions. The French Treas
ury has, of course, fully acquainted the
officials of the United States Treasury
at Washington with it's plans"
The first issue of the British Treas
ury bills in this market was bought out
by j.. P. Morgan G. Co. on August l.,
1917, and since that time, they have
been sold in varying weekly amounts.
The total outstanding has run generally
from S80,000,O00 to $100,000,OO0 and the
rate at which the bills have been sold
has varied from to per cent. 1t
is considered natural that the French
Treasury should undertake operations
similar to the successful British Treas
ury sale.
The French Treasury carries large
balances in this country, it vas pointed
out in banking circles, and could un-
doubtedly obtain from it's depositaries
such temporary accommodation as it
might desire, but it has deemed it
wiser to follow the plan Of familiariz-
ing the general market with the char
acter Of the French Treasury obliga-
tions.
Asked whether thes proceeds of the
French bills would he expended. in
this country, j. P. Morgan said that
that would probably be the case al
though he added that this question
was not one which was causing worry
to his firm. MIR. Morgan thought it
quite possible that the French govern
ment would place the dollar credit
thus created at the disposal of French
importers.
Big Maturity Tomorrow
Mr.. Morgan made it plain that the
decision to sell French Treasury bilie
in this market had no connection witt
the $100,000,000 French government
loan maturing here tomorrow. This
transaction was put through by the
American Foreign Securities Corpora
tion in July, 1916, by the Morgan firm
and associated banking institutions
Announcement was made early this
month that provision had been made
for the payment of the Obligation
When the securities company wa:
organized with a capitalization of $40
100000 it received from the French
government as collateral securitie.
having a value Of $12O,OOOO 900. Tn,
company issued S94 800 900 of it,
three-year 5 per cent gold notes at
yield of 5.735 per cent.
! Exchange rates on Paris yesterda.
declined to 1886 francs to the dollar
the most unfavorablc figure touche'
since the war began and deprecia
tion Of nearly 80 per cent below Thu
normal parity. There was some re
covery later, attributed largely to tn
reports that negotiations had bee
closed for the offering of French bill
in this market