File No. 815.51/324.
The Secretary of State to the Chairman of the Senate Committee on Foreign Relations .
Washington , February 6, 1912 .
Sir: Referring to my letter to you of February 13, 1911, wherewith I transmitted to your honorable committee at the direction of the President copies of the draft agreements negotiated by the representative of the Republic of Honduras with Messrs. J. P. Morgan and Company, Kuhn, Loeb and Company, the National City Bank, and the First National Bank of New York for a loan of $10,000,000, I now have the honor to inform you that as the time specified for fulfilling certain of the covenants in that agreement has expired the bankers above mentioned have notified the Department, through their attorney, Mr. F. B. Jennings, that the agreement has lapsed and that they have withdrawn their proposal to make a loan to the Government of Honduras at this time.
It is now hoped that other American financial institutions will be persuaded to undertake the task of rehabilitating the finances of Honduras, but I fear that unless prompt action on the convention be had it will be very difficult to induce American enterprise to enter into the [Page 609] field, and I therefore hope that you may find it convenient to have the convention, which has already been favorably reported by your committee, promptly brought up and considered in the Senate.
I have [etc.]