893.516/746: Telegram
The Acting Secretary of State to the Consul General at Shanghai (Lockhart)
175. Information has been received to the effect that the puppet bank in Central China has not yet pressed for full membership in the clearing house but has requested the opening of a current account in Chinese currency for receiving and paying checks; and that it is felt that once the account is opened it would be difficult to resist a further demand.
In the opinion of the Department it is of course highly desirable that the puppet bank be not granted membership in the clearing house or any other facilities for receiving and paying checks. The matter would seem to be one for decision principally by Chinese banks at Shanghai, but it might serve a useful purpose if you would make known informally and discreetly the Department’s views in regard to this matter to American bankers at Shanghai, who might in turn pass the word on to their British and Chinese banking contacts. It is also suggested that you inform your British colleague.