CREDIT GRANTED

Taranaki Daily News, 3 August 1931, Page 7

CREDIT GRANTED

COOPERATION OF NATIONS

BRITAIN, FRANCE, AMERICA OBVIATING GOLD MOVEMENT AID.TO BRITAIN IF NEEDED IMPORTANT STEP TAKEN By Telegraph—Press Assn.—Copyright. Rec. 5.5 p.m. London, Aug. 1. The Bank of France and the Federal Reserve Bank, New York, are granting the Bank of England credits amounting to £25,000,000 each.

Tho announcement means that an agreement has been reached for financial co-operation between France, Great Britain and the United States under which the dollar, franc and pound are placed on a more co-operative basis than ever.

Having granted large credits to Germany, London requires an assurance of freedom from the strain of a continual withdrawal of foreign credits. It may not be necessary for London to draw upon these credits; they have been arranged solely as a precaution. As the credit arranged is triangular, moreover, any one of the three banks can call for the assistance of the others if necessary.

Sir Robert Kindersley, a director of the Bank of England, after the announcement said: “The arrangement has given mo great satisfaction because it

constitutes in a time of crisis a guarantee of the solidarity and complete co-operation of the central banks of Paris and New York.. Sudden unreasonable movements of gold tend to disturb confidence. They also are embarrassing to the loser and the recipient. These steps have been taken to obviate such movements, but the basic necessity for the establishment of confidence and prosperity is a really lasting FrancoGerman understanding which it is everybody’s duty to assist.” An emergency decree restores full banking facilities in Germany on Wednesday, says a Berlin message.