New-York tribune., 1921-10-25
Refunding Chinese
Loans Discussed by
Consortium Croup
American Members Will Pre-
sent Plan to Others i'm
International Committee:
Financing Is Due Soon

representatives of the American
banking interests which are a party to
the international consortium agreement
TOR extending financial assistance to
China, considered yesterday at the
offices of ]. P. Morgan & Co. what the
attitude of the combination is to be
with regard to a refunding operation
Tor taking care of the Chinese govern
menus M immediate maturing obligations.
me amount involved is estimated at
from $15,000,00 to $20,000,0OO. Before
proceeding with such loan the Amer
lean group will sound out the attitude
q the British, French. Japanese and
to undertake the financing it will be
the first business the consortium has
arranged since the new international
agreement was consummated in the fall
of 1920.
The Chinese government has two
loans, Originally placed in the United
States, falling due before the end of the
year. The first maturity is the $5,-
100000 two-year 6 per cent Treasury
note issue brought out by the Continen-
tai and Commercial Trust and Savings
Bank of Chicago in 1919 to refund
three year loan of the same amount
arranged by the Continental and Com
merclal and falling due at that time.
This loan is due November / next. An
other loan of S5,500,00 arranged by the
tactic DEVELOPMENT Corporation in
1919 is also to be provided for. The
company loaned the Chinese govern
ment this amount for two-year
period on the notes of the Chinese
Treasury and in turn obtained loan
OF $6,O00,000 secured by these notes.
The company paid off $1,00O,OOO of the
loan when due April /, 1921, and the
remaining $4,000.000 was extended to
December 81, 1921. 1t is secured by
a lien on the wine and tobacco taxes
OF China. together with an option for
further loans on the same maturity
The proposed consolidated refunding
loan to take care Of these maturities
would also provide for the resump-
tlon of interest payments on the Ger
man series of the Hukuang Railways
per cent loan of 1911 and the pay
ment OF the back interest on this issue
In July, 1920, the Chinese government
anpounced that, being, still in a state
Of war with Germany, interest and
sinking fund payments were not being
made on certain German issues Of
Chinese government bonds, including
the Hukuang issue. This loan was
made in British, American and German
series. The suspension of payment
applied only to the German bonds.
Representatives of the Continental
and Commercial Trust and Savings
Bank. which arranged the $5,500,00O
loan maturing November /, have been
in China negotiating q refunding op-
Grafton and as member of the Ameri-
can group have opened the business
to the other members in accordance
with the consortium agreement. The
houses and institutions represented in
the American group include ]. P.
Morgan & Co., Kuhn, Loeb & Co., the
National City Bank of New York, the
Guaranty Trust Company, the Chase
National Bank, Lee, Higginson g. Co.,
and the Continental and Commercial
Trust and Savings Bank
The international consortium agree
ment provides among other things for
complete equality among the different
groups in all business undertaken by
the consortium, and reserves freedom
to each group to decline to participate
in any business which it does not de-
sire to undertake.