BANK OF FRANCE
HUGE LOSS ON STERLING
GOVERNMENT TO RESCUE
PABIS, Bth December
An officially-inspired statement says that tho Government is repaying the Bank of France's losses of £30,000,000 on its sterling holdings. It is explained that tho Government is merely ensuring that the bank will not lose through a following Government's policy; moreover it cannot be permitted to bear alone the results of foreign decisions.
It appears that the bank bought a large amount of foreign currency, principally sterling, between August, 1926, and June, 1928, to prevent a fall in the franc. It later wished to convert its holdings into gold, but tho Bank of England protested that the London market could not face the sales. Eventually, after the franc was stabilised, money flowed into France. The bank did not convert its sterling, with the result that after the fall of sterling the bank was loft with £62,000,000 of depreciated currency. The bank will be compensated by means of Treasury bonds repayable in 1945. These will be revised every six months, according to the sterling rate. The statement adds that in -view of the nervousness of foreign markets it is essential that the franc should be impregnable.
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Bibliographic details
Evening Post, Volume CXII, Issue 140, 10 December 1931, Page 9
Word Count
198
BANK OF FRANCE
Evening Post, Volume CXII, Issue 140, 10 December 1931, Page 9
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