(2) Statement by Toyotaro Yuki, Governor of the Bank of Japan
In order to contribute toward a sound development of the currency system of the National Government of China at Nanking, the Bank of Japan
has decided to extend a credit of ¥100,000,000 to the Central Reserve Bank of China and the signing of the contract by the two banks has been completed on Tuesday.
The Central Reserve Bank of China has succeeded in abolishing the circulation of the old fapi notes. Thus the reserve notes issued by the Central Reserve Bank of China literally and practically have become the standard currency in Central as well as South China.
The amount of the reserve notes issued by the Central Reserve Bank of China is said to have skyrocketed to 1,300,000,000 yuan recently and the public has much confidence in the notes. Moreover, its financial relations with the Bank of Japan have also been bettered and improved and under such circumstances, we have decided to extend the loan to the Central Reserve Bank with the sole purpose of seeing it undergo a marked development in the future.
The Bank of Japan, of course, firmly believes that the Central Reserve Bank of China will make a marked progress in the future, serving to be a powerful wing of the financial circles of greater East Asia, and therefore we will spare no effort in offering our assistance and support to it.
As was in the case of the loan the Bank of Japan allowed the Finance Ministry of the Thai Government sometime ago, so the current allowance of the ¥100,000,000 loan to the Central Reserve Bank of China will no doubt serve to strengthen the renewed financial circles established in the greater East Asia co-prosperity sphere in which the yen will be made the standard currency. Such being the case, it hardly needs mention that the mission of the yen in the greater East Asia co-prosperity sphere in the future will be more stronger than ever.
The main points of the agreement are as follow:
(1) The Bank of Japan shall extend a ¥100,000,000 loan to the Central Reserve Bank of China for a term of five years.
(2) The Central Reserve Bank of China shall pay an interest of 0.35 per cent. of the capital.
(3) The Central Reserve Bank of China shall at will return any fractional amount of the loan prior to the expiration of the term.
(4) The term of the loan may be extended through negotiations conducted by the two banks.