893.51/2686a: Telegram

The Acting Secretary of State to the Chargé in China (Tenney)

44. Please communicate following to International Banking Corporation for American Group and advise your British, French and Japanese colleagues:

“Referring to your recent despatches American Group are prepared in view of decision of French Group to join in temporary advance of 7,000,000 dollars Mexican to extent of regular quota to join with Japanese Group in making remaining three-fourths advance, namely, 5,250,000 dollars Mexican. Please advise representative of International Banking Corporation that cable has been [Page 634]transmitted to him requesting him to draw on J. P. Morgan and Company for 2,625,000 dollars Mexican on receipt by him from the Chinese Government of its six months Treasury bills of this principal amount discounted for six months at 8 per cent together with commission of 5 per mill or the equivalent of one-half [of 1?] per cent, upon said principal amount. It is understood that the Treasury bills are to be repaid from the proceeds of the emergency loan and the advance is made upon the sole condition that the Chinese Government accepts all the conditions of the emergency loan as transmitted to them by the International Banking Corporation. In the event that such emergency loan is consummated prior to maturity of the six months Treasury bills the latter are to be redeemed with an adjustment of interest from date of redemption to date of said maturity. Please advise International Banking Corporation that this cable is authority for them to draw in anticipation of receipt by them of direct communication from New York office.”

Polk