819.51/983: Telegram
The Minister in Panama (Corrigan) to the Secretary of State
[Received 6:57 p.m.]
139. An administration banking bill was introduced in the National Assembly yesterday and passed in first reading in substitution for the controversial guarantee bond law. The measure entirely eliminates provisions relating to purchase of guarantee bonds which were to have been exchangeable at par for 1923 and 1928 external loan bonds. It is strictly a banking measure without mention of public utility enterprises and gasoline importers. It is understood to meet the objections of the American banking interests affected by the guarantee bond law and to have had their study in draft form.
[Page 821]The bill requires Panaman incorporation with a paid up capital of not less than 250,000 balboas. A cash reserve of 20% of current deposits and 10% of savings accounts is specified. It further provides that 60% of the total deposits of entities domiciled in the jurisdiction of the Republic shall be held in the Republic, of which three-fourths shall be invested in operations authorized by the bill.