Foreign Relations of the United States Diplomatic Papers, 1938, The American Republics, Volume V

823.51/1252a: Telegram

The Secretary of State to the Ambassador in Peru (Steinhardt)

Washington, November 21, 1938—7 p.m.

55. The Foreign Bondholders Protective Council is informed that Schroder and Company of London has announced an offer by the Peruvian Government to the British holders of the Guano Loan of 4% interest and 2% amortization, this offer being of a definitive character. Please query and report.

You are of course familiar with the Department’s policy of opposing any discrimination against American bondholders (Department’s telegram 77, November 29, 1932⁵⁷), and consequent desire that an equitable ratio be maintained in the interest rates fixed under the contemplated debt settlements.

Hull

57. Not printed. This telegram referred to a reported plan for payment on the sterling guano loan and stated: “The Department assumes that there is no wish on the part of the Peruvian Government to give preferential treatment to British over American bondholders and that the Peruvian Government will therefore be prepared to propose terms to the latter not less favorable than those negotiated with the holders of the guano bonds.” (823.51/903)