893.516/426: Telegram
The Consul General at Shanghai (Cunningham) to the Secretary of State
Shanghai, April 3, 1935—5
p.m.
[Received April 3—4:15 p.m.]
[Received April 3—4:15 p.m.]
155. Referring to my telegram No. 144, March 29, 1 p.m.80
- 1.
- At meeting of Board of Bank of China on April 1st T. V. Soong was made chairman of board replacing Li Ming. Standing committee of board thereupon chose Sung Han-Chang, a former Shanghai manager, as general manager, replacing Chang Kia-ngau. On March 30 the shareholders voted to accept yuan 15,000,000 of the Government’s yuan 100,000,000 currency loan to increase total capital of [Page 567] bank to yuan 40,000,000 of which 50% is private and 50% Government. Control of the Bank of China now rests definitely with the Government, the Ministry of Finance having power to designate chairman of board from the standing committee elected by the directors from among themselves. Twelve directors out of 21 are appointed by Ministry of Finance.
- 2.
- With the Government now controlling Central Bank and Banks of China and Communications, it doubtless is in position to control Chinese banking and possibly currency and silver. At the end of 1933, these three banks accounted for 70 percent of China’s total note issue while on February 8, 1935 they held over 80 percent of the silver in Shanghai Chinese banks which in turn held 88 percent of the total silver in all Shanghai banks.
- 3.
- Press this morning reports Soong as saying: “The object of the reshuffling of the directing personnel of the three leading banks is to insure the carrying out of a common policy to assist the market and maintain sound currency. I have the assurance of the Government that there will be no inflation.”
Cunningham
- Not printed.↩