§ 55. Mr. BUTCHERasked the Chancellor of the Exchequer whether there is any reason for continuing the employment of the German managers and clerks who are 576 still employed at the Deutsche Bank, the Dresdner Bank, and the Disconto-Gesell-schaft Bank; and whether the time has come for taking the affairs of such banks wholly out of the control of the former managers and placing them under the complete control of Sir William Pleader?
§ Mr. McKENNAThe employment of these persons will be discontinued at the earliest possible date; but for the practical reasons explained in the answer I gave to the hon. and learned Member on 24th October it is not possible to do so at once.
§ Sir E. CARSONIs it not a fact that these banks are advertising in America that they are still carrying on business in London?
§ Mr. McKENNAI have seen a copy of an advertisement from which it appears that the London branch is named amongst other branches of these banks. I can only assume, inasmuch as the London branches have been closed since August, 1914, that the advertisement is a mere repetition of an old advertisement.
Sir H. DALZIELCan my right hon. Friend say whether we can have the advantage of seeing the correspondence which, as Chancellor of the Exchequer, he has been carrying on with Lord North-cliffe?
§ Mr. SPEAKERThat is another question which does not arise.
§ Mr. BUTCHERWill the right hon. Gentleman now take steps, seeing that the business has come to an end, to sell the business premises in London?
§ Mr. McKENNAI have already answered that question on a previous occasion.
§ Mr. BUTCHERWhat is the answer?
§ Mr. BILLINGAs the right hon. Gentleman has stated that these banks are being wound up in the interests of British creditors, will he publish the names of the British creditors?
§ Mr. McKENNAI do not know whether the Report which the Comptroller is shortly about to make and which will be laid before the House will contain the names of the creditors, but, if it does, of course the information will be available.
§ Mr. BILLINGWill the right hon. Gentleman see that it does?
§ Mr. McKENNAIt depends upon the number of creditors. It may be a very voluminous document.
§ Mr. BUTCHERWhy cannot these business premises be sold?
§ Mr. McKENNAIf the hon. and learned Gentleman will put down a question, I will give him the same answer again.
§ 56. Mr. BUTCHERasked the Chancellor of the Exchequer whether he will lay upon the Table of the House a copy of the new licence granted or about to be granted to the Deutsche Bank?
§ Mr. McKENNAYes, Sir.
§ 57. Mr. BUTCHERasked the Chancellor of the Exchequer whether the winding-up of the affairs of the two Austrian banks in London, namely, the Anglo-Austrian Bank and the Oesterreichische Laender Bank, has yet been completed; if not, what still remains to be done; what is the amount of the outstanding liabilities of each of these banks to creditors other than alien enemy creditors; and whether, so soon as these liabilities have been paid or provided for, he will revoke the licences granted to them?
§ Mr. McKENNAThe answer to the first part of the question is in the negative. The work still to be done by these banks is of the same character as that which remains to be done in connection with the winding-up of the Deutsche Bank, the nature of which was explained in the statement circulated by me on the 26th October. The Anglo-Austrian Bank has discharged all its liabilities to British, Allied, and neutral creditors. The Oesterreichische Laenderbank, however, is still indebted to British, Allied, and neutral creditors to a considerable amount. Neither bank has discharged its liabilities to the Bank of England. The answer to the last part of the question is in the affirmative.
§ Mr. BILLINGIs it the intention of the Government to let these banks trade in this country after the War?
§ Mr. McKENNAEvery step is being taken to close all connection between these banks and their British customers. More than that at present obviously I cannot do.
§ 59. Mr. RUPERT GWYNNEasked the Chancellor of the Exchequer whether, in view of the close relations and agreements existing before and since the out- 578 break of war between the Hong Kong and Shanghai Banking Corporation and the Deutsch-Asiatische Bank, and the prejudicial effect of the same upon British interests and British prestige in the Par East, His Majesty's Government will now take steps, by legislation or otherwise, to prevent German influence being similarly exercised in future, and by requiring, inter alia, that the direction and control of all British banks or financial syndicates engaged in the business of public loans for foreign countries shall be vested exclusively in British subjects, native-born?
§ Mr. McKENNANo evidence has come before me that the relations which have existed between the Hong Kong and Shanghai Banking Corporation and the Deutsch-Asiatische Bank have had a prejudicial effect either upon British interests or upon British prestige in the Far East, or that German influence has had an opportunity in this connection of being exercised to the prejudice of British interests. The service of Chinese Government Loans by the British Bank is beneficial to the bank and the British bondholder, and any alteration of the arrangements now in force would probably benefit German and injure British interests. I am not, as at present advised, prepared to introduce legislation of the character suggested in the latter part of the question, the most probable effect of which would be to transfer a large part of the business in question to foreign institutions.
§ Mr. GWYNNEAre we to take it that the right hon. Gentleman is going still to encourage alien enemies trading with these banks?
§ Mr. MCKENNAIf the hon. Gentleman will read my reply and examine it carefully, he will find it a complete answer to his question.
§ 60 and 130. Major HUNTasked (1) the Chancellor of the Exchequer of what value to the British Empire are the German and other enemy banks; and to what extent is it necessary to continue such banks other than in a liquidation which is intended to end the existence of the businesses; and (2) the President of the Board of Trade what part of the businesses now carried on by the German and other enemy banks could not be carried on if and when the businesses were put formally into liquidation?
§ Mr. McKENNAThe German banks have been closed for business since the outbreak of war. The work necessary for clearing up the situation which arose on the closing of the banks consisted in the collection of outstanding debts, the payment of liabilities to non-enemy creditors, the handing over of securities to non-enemy owners, and the scheduling of enemy securities for vesting in the Public Trustee. Any measures short of these would leave the connection between the German banks and their customers unbroken. It is not sufficient to bring the immediate business of the banks to an end—that was done in August, 1914: it is necessary also to sever the link between them and their British customers. A full Report by the Controller is now being prepared and will shortly be laid before the House. I would add that what has been done in the case of these banks amounts to liquidation, and no business is being carried on by them which would be stopped if they were put formally into liquidation.
§ Mr. PRINGLEDoes that answer cover all the information given in the letter to Lord Northcliffe, which the right hon. Gentleman refused permission to publish?
§ Mr. McKENNAI do not know to what letter the hon. Gentleman refers.
§ Mr. PRINGLEThe lettter referred to in the "Times."
§ Mr. BILLINGWill the right hon. Gentleman say whether it will be laid on the Table of the House?
§ Mr. SPEAKERThe hon. Member is abusing his privilege of asking supplementary questions.