New-York tribune., 1920-04-28
Form Overseas
Trust to Place
Foreign Issues
Investment Corporation Or.
ganizcdby American Bank.
ing Group, With Author
lied Capital of$5, 100000

formation of the Overseas Securities
Corporation, with an authorized cani-
talization of $5,ooo,ooo to place foreign
securities in the American market in
such form as to attract American in
veSImenC was announced Yesterday by
Bernard, Scholls e. Co. The cornora.
tion is similar to those which have cy-
lsted for years abroad, notably in
Great Britain, and to those recently
formed and under consideration hv
bankers here
The principal functions of the cor
poratlon, it is announced, will be: The
investment of it's capital in securities
of foreign countries or of industries or
corporations in foreign securities:
participating in the financing or re-
financing Of business enterprises or
corporations in foreign securities, and
tlons, primarily abroad, as may from
time to time commend themselves to
the Judgment of the board Of directors.
The board of directors is composed
of Duncan A. Holmes, vice president
or Chase Securities Corporation;
Royal Victor, of Sullivan & Cromwell;
Frederick T. Walker, agent of the
Royal Bank Of Canada; Arthur j.
Rosenthal, of Bernard. Scholle & Com
pany; Henry c. Quarles, vice president
second Ward Savings Bank, Milwau
kee; Lucius W. Mayer, of Rogers,
Mayer e. Ball; Edgar c. Baruc and
Morton II. Fry, of Bernard, Scholle &
Co.
Bankers and other men of affairs
will be obtained in an advisory capac-
lty, it is announced. Through this
arrangement it is intended to keep in
formed on conditions in different coun-
tries and to obtain the benefit of the
Judgment of experienced minds famil-
lar with such conditions. The di-
rectors will receive an aggregate
amount equal TO S per cent of the net
profits of the corporation.
OF the 5000 common shares of 81 900
par value, 1000 will be issued. the re-
mainder t. be held by the corporation
for the present. There will be 10000
managers shares of no par value. The
managers shares, a feature adopted
by the English companies, will be re-
served for sale to the directors and
interests identified with the corpora
ton at $40 share without deductions
for commissions. They will be en-
titled to 20 per cent of the profits of
the corporation, when and as dis
trlbrted, and tn voting power will be
vested in them. No dividend can be
IL
proportionatc dividend, that is 80 per
cent Of the profits, is paid at the same
time on the common stock. This pro-
vision, II is explained, is to protect
investors against a division of profits
among managers only
In explaining the scope Of operations
the agents of the company say in their
prospectus:
due to extraordinary conditions OK
isting in industry and finance through
out the world to-day, opportunities
generations are presented to discrn-
mating investors. 1t is the confident
belief Of the organizers that this con-
dltlon OF affairs and particularly the
present depreciation in foreign eX-
ange-which makes it possible for
American investors to buy securities
IN foreign countries at valuations of
from about 70 cents on the dollar in
the case of England to about 10 cents
Oh the dollar in the case Of Central
Europe should enable corporation
Of this kind to earn substantial profits
over period Of years.
at is purposed to invest certain per
centages Of the available capital Of the
corporation in securities originating in
various foreign countries just as soon
as conditions in the judgment of the
management seem to warrant. BY
making such investments in times of
depreciation, and by diversfying the
risks, both as to the country where the
money is invested and as to the invest
ments in each individual country, sub
stantial profits should be made even if
in individual cases losses should be
suffered. It is intended also that the
corporation, either directly or through
subsidiaries, shall buy and sell foreign
exchange.
"The corporation may, in addition,
issue it's own debeniires or other obll-
cations or securities for the purpose
of acquiring such assets az may be
deemed desirable. Such Obligations
may or may not be collaterally secured
by TIE specific proposition or PROPOSE
tions involved. 1t is believed that
through such operations a desirable
form Of security for the American M
vestor would be created, nd that the
profits resulting to the common stock
Of the corporation would thereby be
increased"