The sun., 1919-05-17
CHINESE LOAN Is
NEARLY ARRANGED
Details Of $100,000,O00 Four
Power Plan Await Return
of Bankers.
BELGIUM TO JOIN LATER
Money Will Be Advanced in
-Four Instalments as
Separate Loans.

Arrangements Tor loan OF 800, 000,-
600 to China are nearing completion,
according to information obtained in
reliable banking circles yesterday. The
loan will be participated in by the
United States. England. France and
Japan, with reservation for Belgium
when that country is again able to take
part In the transaction Banks in at
least eight American cities will be
among the participants and the final
details of the big scheme are expected
10 be worked out Immediately after the
return OF interested bankers who are
IN Europe.
Tentative plans call for lending
500, 900 In 25,000.O0 instruments.
Every instalment will represent sepa-
rate loan. Among the New York bank
ers and banks expected TO participate
r. the loci are ]. p. Morgan q Co.
1Iuhh Loeb & Co. the National City
Bank. the First National Bank. the Ma
tiotal Bank of Commerce and the Guar
arty Trust Company. In addition to
the three ST Louis banks, three in
Chicago, two in Pittsburg, two in Bos-
ton, two in Philadelphia, one in New
orleans and in Minneapolis will have
Shares in the project
The loan is the result OF long drawn
cut negotiations in progress for many
months. Several months ago 1t was an
nounced by cable from China that ar
Engagements for a loan of SIS. 000,0 900 to
China had been made with a Japanese
group. Nothing more was heard OF that
proposal for time and then came a
story from London to the effect that
the loan had been stopped as the result
Of activity on the part of British and
naTf log ~ n NNln to NA.sR - q
allied banking group. The reason given
or the killing OF the Japanese loan was
thst it was to have been secured by a
tobacco monopoly, which If effected
would have operated greatly to the dis
advantage of American and British to-
hacco interests. Failing In Its effort to
get the money from Japan, China found
It necessary to seek elsewhere and the
new four Power loan is the result of that
situation. ..-.
A big Chinese loan has been an inter-
esung topic ever since the formation of
the six Power group in 1912 for the pur-
rose OF lending funds to- China The
members of the group were the United
states, Great Britain, France, Germany,
Japan and Rr-sia- Following the es-
Enlistment of the agreement sums OF
money were advanced by certain men,
oers Of the group to al ow the Chinese
Government more firmly to establish IT.
self. The chief points of the agreement
made with China by this group were
that China was to reorganize its Gov
eminent on more effective basis. pny off
its obligations, build UP Chinese credit
through the world and protect Amer
lean and European interests.
Shortly after the Wilson AdmIrsstra-
ton took the reins at Washington Amer
.can bankers were informed that our
Government would not allow their par
ticipation In the loan and the American
group withdrew from all negotiations
When the six Power agreement expired
BY limitation on June 80. 1917. the
American banks were free to act inde-
pendently in connection with a Chinese
Joan, but in the meantime the war had
come, and although repeated efforts were
made TO renew negotiations nothing
came Of them. o..
In July of last year the American
Government agreed to a loan In China
by American banking interests on condi-
ton that China cancel all outstanding
loans and that the loan be shared in by
bankers OF this country. Japan. Great
Britain and France. Negotiations were
resumed at once for a $4,000. 900 loan,
but because OF the pressure of war
financing in this country and the al
.'ed nations no progress was made. 1t
IS considered likely that the loan now
taking form Is based on sanction of the
Administration given last summer.
According 10 the report at that time
lie State Department insisted on the
Qladrupie financial alliance that one
country would not gain a predominant
financial advantage in China, which
would have necessitated cancellation of
the slO.00o,000 loan. advanced Just prior
70 that time by Japan in agreement with
Entente bankers
Whether or not the loan be guaranteed
IN anr part by the United States Gov
eminent is not known. 1t is understood
that at the time tho negotiations were
heIhs carried on last year American
bankers maintained that they did not
care, 10 lend money to China unless the
loan carried this Governments guaranty.