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The Columbia University Libraries reserve the right to refuse to accept a copying order if, in its judgement, fulfillment of the order would involve violation of the copyright law. Author: Guaranty Trust Company of New York Title: How business with foreign countries is financed... Place: New York Date: [1921] ^s-^-zi\-iio-io MASTER NEGATIVE # COLUMBIA UNIVERSITY LIBRARIES PRESERVATION DIVISION BIBLIOGRAPHIC MICROFORM TARGET ORIGINAL MATERIAL AS FILMED - EXISTING BIBLIOGRAPHIC RECORD / ■BS • USIMESS 725^3 G932 Guaranty trust company of New York. How business with foreign countries is financed, 1921. New York [etc.] Guaranty trust company of New York =1921 ] 74 p. incl. illus., forms. 24*"". 1. U. S.— Comm. 2. Rnnlrg ao d Panking. i. Title. Library of Congress Copyright A 611856 O HG2569.G72 1921 [s25c2i 21—7429 RESTRICTIONS ON USE: TECHNICAL MICROFORM DATA FILM SIZE: . 35 fM»H REDUCTION RATIO: I^X IMAGE PLACEMENT: lA / HA \ IB IIB DATE FILMED : ^///fr INITIALS: TRACKING # : Xfs// oun o m (DO CO P'CO X M X *?: > ^h^*' ^\'^^ ^ V .-v*?' %.f^ -? O o 3 3 > M O 3 3 8 3 3 en o |rpiI|!P|?|?iS|- ff bo c> 00 b ro In 1.0 mm 1.5 mm 2.0 mm ABCDEFGHIJKLMNOPQRSTUVWXYZ abcdefgh(jklmnopqrstuvwxyzl234567890 ABCDEFGHIJKLMNOPQRSTUVWXYZ abcdefghijklmnopqrstuvwxyzl234567890 ABCDEFGHIJKLMNOPQRSTUVWXYZ abcdefghijklmnopqrstuvwxyz 1234567890 2.5 mm ABCDEFGHIJKLMNOPQRSTUVWXYZ abcdefghijklmnopqrstuvwxyz 1234567890 V 'S^ ^o f-? '^, %^ f^ 4fr *^ <^ '^o V fcp 'fd. fp '■is- m H O O > C ci> X Tl ^ m o m -?> ^^%%/. ^>> c^ 4^ i^ \[o x«* V ^ ^^ S| ^o if i^ 1— » to en z — 0) o > <» o Is <-♦■ ^ *< ::o ^— I OOM o T ft s i How Business with Foreign Countries is Financed ■•; i . - SCHOOL OF BUSINESS Guaranty Trust Company of New York ii :''?!SS8II M Columbia ©mfaersifp*^ * * LIBRARY School of Business I .-J How Business with Foreign Countries is Financed 1921 Guaranty Trust Company of New York Head Office: 140 Broadway, New York FIFTH AVENUE OFFICE Fifth Avenue and 44th Street MADISON AVENUE OFFICE Madison Avenue and 60th Street GRAND STREET OFFICE 268 Grand Street I O N D O N OFFICES ^2 Lnnibard Street, E. C. ; » Pall Mall Alexandra HouHe, Kinggway LIVERPOOL OFFICE 27 Cotton Exchange Buildings HAVRE OFFICE 122 Boulevard Strasbourg PARIS OFFICE Rue dea Iialiens, 1 and 3 ANTWERP OFFICE 36 Rue des Tanneurs BRUSSELS OFFICE 158 Rue Royale CONSTANTINOPLE OFFICE 21 Rue KurekdjUer. GalaU I ci 0- ^<5 Foreword Copyright, 1921 By Guaranty Trust Company of New York ^I^HE purpose of this booklet is to outline the services and facilities offered by the Guaranty Trust Company of New York in financing foreign trade, and to explain the methods and forms generally used. ij J) T1S.-3 &n9 t^ A I / , /i^,r^ ^ main office Guaranty Trust Company of New York 140 Broadway, New York ■jgfr"-^'' List of Forms PAGE Acceptance Agreement 39 Application for Letter of Credit 28 Bailee Receipt 55 Bank Acceptance, not based on imports or exports 43 Banker's Demand Draft on Barcelona, Spain 13 Banker's Demand Draft on London 10 Banker's Demand Draft on Paris 12 Banker's Time Draft on London 11 Consular Invoice 49 Commercial Draft, drawn in dollars 15 Draft on an English Bank against a Shipment of Cotton to Liverpool 16 Draft in Pounds Sterling for Export to Australia or a British Colony 17 Export Letter of Credit (Irrevocable) 25 Export Letter of Credit, (Revocable) 24 Import Letter of Credit Agreement (Dollars) 30 Import Letter of Credit Agreement (Pounds Sterling) 33 Import Letter of Credit (Dollars) 29 Import Letter of Credit (Pounds Sterling) 32 Letter of Instructions (to accompany draft for collection) 21 Trade Acceptance, based on domestic sales of merchandise 42 Travelers Check 58 Travelers Letter of Credit (Dollars) 60-61 Travelers Letter of Credit (Francs) 64-65 Travelers Letter of Credit (Pounds Sterling) 62-63 {Continued on following page) w List of Forms (Continued) f PAGE Trust Receipt, as used when the merchandise is entrusted to the merchant for sale 51 Trust Receipt, as used in connection unth export credits and loans 52 Trust Receipt, as used to cover delivery of merchandise actually sold 53 Trust Receipt, as temporarily accepted against surrender of shipping documents .54 I, How Business with Foreign Countries is Financed Banking Service for Foreign Trade The most important factor in financing foreign trade is the service rendered by a bank to its clients. To make this service complete in every respect, it is neces- sary that a bank be in intimate and constant contact with all parts of the world. Beside its own offices in New York, London, Paris, Brussels, Liverpool, Antwerp. Havre and Constantinople, and its resident representatives and travelers abroad, the Company is affiliated with institutions which operate in particular spheres. In addition to these, it has more than 2,000 correspondents, who provide direct, safe and prompt banking service with every part of the globe. Many of these correspondents are among the leading banking institutions of the world. They have been long established in their respective localities and are thoroughly familiar with local commercial and financial conditions. The Foreign Department of the Guaranty Trust Company of New York is a bank complete in itself. To assist in the development of new foreign business, our International Trade Service supplies data regarding every phase of foreign trade: markets, names of buyers, credit ratings, tariffs, export methods, etc. It endeavors to keep in touch with all international commercial developments, and to give its customers and others interested the latest available information. The Guaranty Trust Company of New York offers these services to bankers, manufacturers and merchants, and cordially invites them to consult the officers of its Foreign Department or its International Trade Service for full information regarding such facilities. The services of the Foreign Department embrace the following: Opening of Current Deposits and Special Accounts. Purchase and sale of Foreign Exchange (Cable Transfers, Checks and Foreign Currencies). Purchase and sale of Future Exchange. Discounting of Bank and Trade Acceptances. Purchase of approved clean and documentary Bills of Exchange. Opening of Import Credits. Opening of Export Credits. Opening of Domestic Letters of Credit. [71 '- "^- ■J-'"— Granting of Acceptance Credits against readily marketable staples in ware- house. Advances and loans on approved collateral. Collection of clean and documentary Bills payable abroad. Protection of drafts drawn by our correspondents on foreign countries. Issuance of Travelers Checks and Letters of Credit. Gathering and compiling Foreign Trade Information. Securing Credit Information for customers and correspondents. Collection of foreign securities and coupons. Acting as custodian of securities. Acting as agents for foreign governments, corporations, firms and individuals. Current Deposits and Special Accounts The Foreign Department receives deposits from its customers in dollars, allow- ing interest on balances of $1,000 or more. On deposits withdrawable only after a fixed period a higher rate is usually granted. The Foreign Department also opens accounts for our customers with our London OflSce in pounds sterling, with our Paris and Brussels OflSces in francs, and with our Constantinople OflSce in Turkish pounds. Cable Transfers The "cable transfer" is the quickest means of transferring value from one coun- try to another. It practically eliminates time and distance which are important factors in financing foreign trade. It is used principally to pay an obligation coming due in some foreign coun- try; to transfer a balance held in a foreign bank to a bank in another country, or to pay for a shipment of merchandise. The rate for cable transfers, or in other words the "cable rate," is the basic rate. It is determined by supply and demand, which in turn are subject to all of the influences of economic laws, such as the volume of imports as compared to exports, and the financial and political conditions of the respective countries. In normal times, this rate is governed principally by the gold content of the standard money of one country as compared to that of another, plus the shipping charges, interest and insurance on the total cost of the gold shipped. Bankers' Drafts A "banker's draft" is a transfer of funds by mail. A bank in this country, for example, draws its draft on a foreign depository payable for a specified amount to some person or firm. These drafts are drawn at sight (payable upon presentation), or within a specified time after presentation. 18] The time which elapses between the issuance and the presentation is dependent upon mail service. A week or ten days may elapse between the mailing of a draft in New York and its presentation in London or Paris, or it may require a month or six weeks to reach certain points in South America or in the Far East. The rate for a sight draft, or in other words the "check rate," is determined largely by adding to the cable rate the interest for the transit time between the issuing and paying banks. The rate of interest depends on the rates ruling at the market of purchase or sale. The rate for time bills, commonly known as the "bill rate," is determined by adding to the check rate the discount ruling in a foreign market for bills having a maturity of 30, 60 or 90 days or more. On the following pages are shown specimens of bankers drafts which can be purchased from us, in any amount, at current rates of exchange. [9] i (iuaranlv Trust Ooinnanvof NewYoi*k L^^l L.5^J2<^: %/^%^:^^^^^ ////A/r/r/ / //// Jf//j'/ <)^ GuarantyTrust Company of NewYofk , X? '74956 ^^ ^'"''^'■'* ^'™^'' London. ""'""' (luarantv Trust Company of New^brk ^-s. '* ■■^. ■■:.,,/. ■ /7 ■ ■ '\ ' ■ PER PRO :. I lTuai"«ntyiru3tl^m|iafiyoi NevirYom, A»ats6w.-r ma^^cm. vo yAQSTf^ ^^2 Lombard Street. _ _. per^^o Demand Bank Draft on London Specimen of a bank draft on London in Pounds Sterling, payable on demand. All foreign drafts are invariably issued in duplicate for greater safety, the remitter sending the "original'* by one mail steamer, and the "duplicate" by a following mail steamer. "tii.'i^m^^iii^m^. ,*< " J' V" St Company of NewWi ijii^n.^/^. 1 — . -,_.,. ^ — = rSTJe«U3sr<5 \XiATK i^KCJKrvK^ A\Trr<;ii charok toh m: ActxH'XT of TO (/uaraiity Trust Company of NcwYork XV A12815 LoWiiow OBarffltf\Trast<»wi«|MHR of Newark ;#?!■ sk Guaranf}' Trust Company of New York M- \iij> h.£^ae,d "^yOSC^ DAYS AFTi:i? ,^ i^^^^?^< ^ ^>^;i^^^^ ^^^^^-^ :,., ' ,. -.i., .^i^^Ai^M^l^.'O^^l /i^tdC^i^') . . :;l-:„: ,,,._ , : ' 1 ,Sthi Sth-ekt, X9 Ar2S15 j.oxuox (ia»rartV'Tnw^ f^MttiMHrvofl^Vodk «0Bf«O. - MSB l-BO. Banker's Time Draft on London Bank draft in Pounds Sterling payable sixty days after presentation to the London Office of the Guaranty Trust Company of New York. Drafts are also issued by us payable at 30, 90 and 120 days sight. I i. # 110] [11] ii INTENTIONAL SECOND EXPOSURE /^ Guamnly IVust Gompam of New%i4i ^^5.000f^^ --^^v -:/f . irf,/-Je&zid^j^^ '■■^^^' 'JS/4i^^tS^. -^-^ ^ /<$: v/ /a /-/' y^yfmJ^ /^^^^^//^ //////^/^// / //// .)///// <^ ''" / 'X PER PRO Gu arantyTrust Company of Nevt^York . \'<> 'T 'f^s:/" 32 Lombard Street, _ , per pro NV /^95b London. (iuaraiiiy Tiusl Company of Newlbik f • - ' •* ' - ■ v5^- ■ /X ■ ■ ■■ •"• ■ • PER pro: Guaranty Trust CZompany of NewYork, \'o ''7'ifi''£« 32 Lombard Street, _ per*»ro NV 749Db London. ASSWEAST (WCKKTAHtr. ASSIX'CAVT MAKAOr.H. Demand Bank Draft on London Specimen of a bank draft on London in Pounds Sterling, |)ayable on deniancL All foreign drafts are invariably issued in duplicate for greater safety, the remitter sending the ''original" by one mail steamer, and the "duplicate" by a following mail steamer. \ S' GuaranlyTwist Compai^^ IHY'ix>TtiK; ORDER cw:J!^^ti!tzv E xcm^vn o k i Fn < h^r i :x i »aid > r^U/rW 'W^-r-. — ■ ,-_■.: ',.:.i.,„— U^^i^ ^M^cid/aa:^^ ..^i^^t£^a^^K ......:-— i-.,. . ,. — — .. stk u.i . i .vq , '\^>X.iri2 HECEmsn VTHICJIl CHAROE 'IHITIIK ACCOtTKT OF ToGiiaraiilvTnistCk)iapaJiVofNf!vv\brk ak X9'"A12S15- * i.oT«oox ■ , ^v :m' Banker's Time Draft on London Bank draft in Pounds Sterling payable sixty days after presentation to the London Office of the Guaranty Trust Company of New Y^ork. Drafts are also issued by us payalile at 30, 90 and 120 days sight. [101 [11] -SSBBSSB (iiiardnly Trust Company of New York I*AY AO^UNST Tins UJtIOIXAL CHBCK (DCKUCATK. HKmC* r:>JI»Al» Ho TIIK ORUKR OP ryva^^ru^ fV/^»i*j» jgN TnousAMt> s*i4iiftz«>ii»zo m\n C*Z«> fi*Z«> Tin-: HI*M OK TO (iiiaranly Trust I'oiufiauy of XewYork Li^'.'i Wwv. r/Vf THOUSAND SiJf HUNOHEL' FtfT Y P9SMTASmif3 MX^VWIfJ. JtJiUSCO MERUANTIL DE LAS AMERIOAS ^^" ^^^ — ' BABOELQNA N^» 55466 peRPRo m • *MnW1A?IT I Asanrnurr iinr«— w. ( Jiiaranly Triisl ( ompany ofXewYoik ^a //i '<*Tfi \^» 55466 *»I#1 f*X«IAIZ#I f / V£ THOUSAND SIM HUNOfi£u PIFTY PMSETAS iA 1* » itZ^y MZ#J» *MaiM><»i«»»if>»z«)#z4gi»x«9eiz#» FHA.MCS TO N9 3351 Guanmty Tnist Coiiipauy of Xew^rk \lk'^ Kui^ tl(>H ItulUuiH Pa rlH, France (manuitr'&iul Company ofXewYotk t. ( jiiaranly Trust Compaii)^ ofNew^bi k Pay AOAIMHT Tins IM'I'I.M'ATK illKC'K (OMK'.IXAL HKIXO IT«I»AII») ToTllB OKDRH OF z«»»zo r^ TMousA$m a*x«ii»Z4>c*z«i f*z#i mzomz«> TlIK H»TM OK Fl«A?f<:» ! ^M»: GuaranlyTnusf CompanTftfXcwYork yo 3351 Paris, France (luamnlr TniM <%»mi»any of Xcw\»ik Bankers' Draft on Paris Bank draft on Paris in French Francs, payable on demand. Writing the date in letters (as shown above) in drafts and checks on France, exempts them from the full bill- stamp' tax of that country. Guaranly Trust Company of New^bi-k '^yr^/ ^^IrU^n Xy^M^ /v /vr/^/' / ^J/^t/rr/y/y /fyy/jfy yy/zViyy/y/ / J^4> jJyy/y^ y^ f '^^^fr/^/ryj¥fy/fj/ytyrywy^/i: iJiUMUU MKaOANTIL DE LAS AMERiOAS PE" PRO ~ ' BAEOELONA X9 55466 PCRPRo _„ _ AfMurcuni ( juaranly Irusl Company of New\brk i ^i&.4 S(}S(P -^ ^//yyy'V/y'//', ^^^i^j!^<^44^A /.'/ f^ '/yr//S:^yi/<^nur^y^yi^± — . . ^ , _. , ,. t ^y /vr// v r fO'///^ ////// /y/>/^ ////V/yy/// / /^y .jyyy// ^^ ^y//r/!^ /r/ur///j/yyy/r/yy///. iMU«W MSEOANTIL DE LAS AMJiAiOM PER PI^O BA£0£LONA \*> 55466 PER PRO ' «MiM1Mi>i'MBCMrt*inr. tJMOKXMn MMrAOCM. Bankers' Draft on Spain Bank draft on Barcelona, Spain, in Pesetas, payable on demand. Such drafts, as well as drafts on the prin- cipal commercial centers of the world, can be purchased from us, at current rates of exchange. 4 I \ K I [121 (13] Il I I Commercial Drafts The foreign Commercial Draft, which for many years has been the commonest form of payment for a shipment to a foreign country, is similar to the ordinary Domestic Commercial Draft. The principal differences are, that it covers a foreign transaction and is drawn on a foreign drawee, that it may be drawn in the currency of the buyer's country or in that of the seller's, depending on the terms of sale, and that it is drawn in duplicate as a protection against loss or delay in payment, the duplicate being sent by the mail following that by which the original is forwarded. Payment or acceptance of either renders the other null and void. Commercial Drafts drawn without shipping documents attached are known as "clean" drafts, while those with shipping documents attached are known as "docu- mentary" drafts. These drafts when drawn upon responsible individuals or busi- ness houses, and with shipping documents attached, if a documentary draft, opens to the seller various possibilities for banking advances and discounts, by means of which, under the proper conditions, the exporter is able to realize, fully or in part, on the sale of his goods as they are shipped. When negotiated by a bank, drafts drawn in foreign currencies are bought at the current rate for 30, 60 or 90 day bills, depending on the usance, while dollar drafts are either discounted by the bank or a loan is made and the collection is taken as collateral. In every instance, however, the time required for the bank to receive the fuhds from abroad must be taken into account by the negotiating bank. Following are given a number of samples of Commercial Drafts in foreign trans- actions, with brief descriptions of their operation. & o o t o ' & o d a V, o o *> u H I . t I. ' a u 3 ■»» c a , ^m^si^ ".^ - -Ninety Kew York, -— - -^ ^ -February 20, // 19 /y^/^/;//;r/W^'//^j^///^^ -//'': MBsars. Santos Hermanos, } ^ ?.io Grande do Sxxl, ' #1/^9.,- Pratll , Manufftcturers Export Gowp&ny, Treasurer. _le? Tork, - - - February 20, .... . . - - //////.f ////// eight ^/^y SKfJOKil, ,/0 - Kinety •/'''' Jiessr ft . Santos Hermanos, . Eio QrandB do Sul, Hanufacturers l-^xport Co^npany, .1.% . Bratll rreisuror. Commercial Draft Drawn in Dollars This form of draft is used when the shipper desires reim- bursement in U. S. Dollars. Such drafts are generally drawn at sight, or at 30, 60 or 90 days sight. They may also be drawn at 30, 60, 90 or 120 days date, according to the arrange- ment between the buyer and the seller. If the draft covers a shipment of merchandise the documents relating to the ship- ment are usually attached and are surrendered to the buyer of the merchandise either against his acceptance of the draft, or against payment, according to the instructions of the seller to the bank. M [14] [15] ll M '» Commercial Drafts The foreign Commercial Draft, which for many years has been the commonest form of payment for a shipment to a foreign country, is similar to the ordinary Domestic Commercial Draft. The principal differences are, that it covers a foreign transaction and is drawn on a foreign drawee, that it may be drawn in the currency of the buyer's country or in that of the seller's, depending on the terms of sale, and that it is drawn in duplicate as a protection against loss or delay in payment, the duplicate being sent by the mail following that by which the original is forwarded. Payment or acceptance of either renders the other null and void. Commercial Drafts drawn without shipping documents attached are known as "clean" drafts, while those with shipping documents attached are known as "docu- mentary" drafts. These drafts when drawn upon responsible individuals or busi- ness houses, and with shipping documents attached, if a documentary draft, opens to the seller various possibilities for banking advances and discounts, by means of which, under the proper conditions, the exporter is able to realize, fully or in part, on the sale of his goods as they are shipped. When negotiated by a bank, drafts drawn in foreign currencies are bought at the current rate for 30, 60 or 90 day bills, depending on the usance, while dollar drafts are either discounted by the bank or a loan is made and the collection is taken as collateral. In every instance, however, | the time required for the bank to receive the fuhds from abroad must be taken into account by the negotiating bank. Following are given a number of samples of Commercial Drafts in foreign trans- actions, with brief descriptions of their operation. c o o •p u o pi u n ■Hi ! S c a R o o *> o H ■ i- o ■f> o W «» J«» ■■ New lork,- .. -FebruP.ry 20, /^W -Hinety T #1.%,- Bratil ,. \ ■>//''' Messrs. Sajatoa,„H«r!aRnoa, Sib Grande do Sul, MMiTifacturers licport Conp&ny, "reasurer. .le? Tork, - - February 20, - - - //f//A^ //////' sight ^/i^>/S«€:oKi> rj !;inety - - - - otjsawl f if « hundred • ■^^' Vtoaar& ' Santos Hermrsnos, . . .' i Eio Qr&nde do Sul, ' ,1/^9 - Brafll \ Manufacturers Export norrtpany. Treaauror. Commercial Draft Drawn in Dollars This form of draft is used when the shipper desires reim- bursement in U. S. Dollars. Such drafts are generally drawn at sight, or at 30, 60 or 90 days sight. They may also be drawn at 30, 60, 90 or 120 days date, according to the arrange- ment between the buyer and the seller. If the draft covers a shipment of merchandise the documents relating to the ship- ment are usually attached and are surrendered to the buyer of the merchandise either against his acceptance of the draft, or against payment, according to the instructions of the seller to the bank. (14] [15] INTENTIONAL SECOND EXPOSURE Commercial Drafts The foreign Commercial Draft, which for many years has been the commonest form of payment for a shipment to a foreign country, is similar to the ordinary Domestic Commercial Draft. The principal differences are, that it covers a foreign transaction and is drawn on a foreign drawee, that it may be drawn in the currency of the buyer's country or in that of the seller's, depending on the terms of sale, and that it is drawn in duplicate as a protection against loss or delay in payment, the duplicate being sent by the mail following that by which the original is forwarded. Payment or acceptance of either renders the other null and void. Commercial Drafts drawn without shipping documents attached are known as "clean" drafts, while those with shipping documents attached are known as "docu- mentary" drafts. These drafts when drawn upon responsible individuals or busi- ness houses, and with shipping documents attached, if a documentary draft, opens to the seller various possibilities for banking advances and discounts, by means of which, under the proper conditions, the exporter is able to realize, fully or in part, on the sale of his goods as they are shipped. When negotiated by a bank, drafts drawn in foreign currencies are bought at the current rate for 30, 60 or 90 day bills, depending on the usance, while dollar drafts are either discounted by the bank or a loan is made and the collection is taken as collateral. In every instance, however, the time required for the bank to receive the fuhds from abroad must be taken into account by the negotiating bank. Following are given a number of samples of Commercial Drafts in foreign trans- actions, with brief descriptions of their operation. & o o t o s u o a r! o o *> KC5T York,- - - - - -Pebrwftr/ 20, // IB - .Ninety /^W /^Z sisht /y////J V\\t*!^'r 1 ,rj •/^f Messrs. Santos Hermanos, a:\^. Hio Grande do Sul^^ Pratll \ lunufftcturera Fxport Company, Trensurer. ,/Rn7, Treasurer. .Jtes-Qrleaiui, La. - - - February 20, - -^ -. /.9 JiS .. - -_-SlJrt.y - - •/^^ London Joint City & iULdlcnd Bank, Ltd., .' London, T. C. , . .V 1042 - EnRlind Louisiana Cotton Conpany, Tree our sr. Draft on an English Bank Against a Shipment of Cotton to Liverpool The above is a form of draft drawn on an English bank against a shipment of cotton to Liverpool. A buyer in England has arranged for his bankers to accept the draft of the American exporter, made out in pounds sterling with documents attached. The American exporter, upon closing his contract for the sale of cotton to be shipped at some future time, immediately arranges with the Guaranty Trust Company of New York for the sale of his sterling draft under what is known as a "future contract." This enables him to establish a rate at which he will receive dollars for his sterling draft when shipment is made. Under, these contracts the American shipper, at the time of shipment, draws on the Guaranty Trust Company of New York through his bank or bankers in the form of a domestic draft in dollars, for the equivalent of the sterling draft, figured at the rate originally fixed in the "future contract." When the dollar draft, accompanied by the sterling draft, is presented for payment at the Guaranty Trust Company of New York there is also attached an invoice, insurance certificate and bill of lading, making a complete set of shipping documents. If these are in order, the dollar draft is paid and retired. The sterling draft accompanied by the other documents is then forwarded to one of the branches of the Guaranty Trust Company for collection. [16] I © c •a O C C o u «) Her York, — Fobru-jry 20, - //? W. - - - - - -Thirty. - - '//f/ /'ff//n /'rr/'//'/// /r//// /'/////f/r /r///r/'/f////^ /f Jtossrs. John Snlth & Conpany, 3. 1469 - _ , Sydn.ey, AuBlraJijai Frank! in !*ichinr*ry Compemy, Inc. Troas'jrer. .,Ko?r York,. -. .- - -jr_ .-.- Febru^rjr 20^.- .-. - /f^^.lS - jt.„-„-_..-_.r„-...- -Thirtj' -..-....-„.-. - - OK» teteiix •///Messrs. . I ... [ John Smith ft Conpr.ny, ,. I Franklin Machinery Coapany, Inc. 9 f. John Smith ft Conpr.ny, 1469 - Sydney, AuotrsH* Treasurer. Draft in Pounds Sterling for Export to Australia or a British Colonv The above is a specimen of a draft drawn in Pounds Ster- ling against a shipment of merchandise to a buyer in Australia. The shipping documents are generally attached to the draft and surrendered against "acceptance" or "payment," according to the instructions of the shipper. These drafts often contain a clause similar to the following: << PAYABLE WITH EXCHANGE AND COLONIAL STAMPS ADDED TO THE CURRENT RATE IN LONDON FOR NEGOTIATING BILLS ON THE COLONIES." This requires the buyer of the goods against whom the draft is drawn, to pay Colonial stamp charges, exchange and interest from the date of the drafts until the approximate date of receipt of funds in payment in London or New York. [17] IHTEraiONAL SECOND EXPOSURE 1 § u c o ■p *> o a c ei 3 o /////^} /////Y sight /^M^ ^^i^mm^ ! ■//'' London Joint City 4 Midland 'Uak, Ui.^ J^- 4^ ,ir'l042 . London, E- C - . England :^^ Loiiialnna Cotton Company, Treasurer. HftF-Cr leans, Ia. - Fabruary 20, /^19 - -Sixty - •/^^ London Joint City & Midlaad Bnnk, Ltd., - London, F. C» , • 1,^1042 - EnElftnd 1 Louisiana Cotton Conpanjr, Trensurer. Draft on an English Bank Against a Shipment of Cotton to Liverpool The above is a form of draft drawn on an English bank against a shipment of cotton to Liverpool. A buyer in England has arranged for his bankers to accept the draft of the American exporter, made out in pounds sterling with documents attached. The American exporter, upon closing his contract for the sale of cotton to be shipped at some future time, immediately arranges with the Guaranty Trust Company of New York for the sale of his sterling draft under what is known as a "future contract." This enables him to establish a rate at which he will receive dollars for his sterling draft when shipment is made. Under these contracts the American shipper, at the time of shipment, draws on the Guaranty Trust Company of New York through his bank or bankers in the form of a domestic draft in dollars, for the equivalent of the sterling draft, figured at the rate originally fixed in the "future contract.'* When the dollar draft, accompanied by the sterling draft, is presented for payment at the Guaranty Trust Company of New York there is also attached an invoice, insurance certificate and bill of lading, making a complete set of shipping documents. If these are in order, the dollar draft is paid and retired. The sterling draft accompanied by the other documents is then forwarded to one of the branches of the Guaranty Trust Company for collection. [16] o c «5 i § JS. o c5 e r-l i it t c c o o f C c o r^ X IJer York, Fobru^ry 20, /!^19 -Thirty • /<' Messrs. John Smith & Company, c/f. 1469 -_ _, . Sydaey, Auslrnlia f I Franklin Fftichlnrry Company, Tnc. Treasijrer. Ko?r York, - - _ - - _ Febru^.-y 20^.- .-.- y^!^.19 - Thirty _ . ./////JL^ //////' si^ht yO^/%f> S KC'ON« 21|^ hundred and seventy ^^^^^i^^Hf^, IS/jS'*^ •x/> Messrs. ] .., > ' Franklin Machinery Conpany, Inc. John Smith * Conpnny, • T. 1469 - . Sydney, Austr^lln \ Treasurer. Draft in Pounds Sterling for Export to Australia or a British Colonv The above is a specimen of a draft drawn in Pounds Ster- ling against a shipment of merchandise to a buyer in Australia. The shipping documents are generally attached to the draft and surrendered against "acceptance" or "payment," according to the instructions of the shipper. These drafts often contain a clause similar to the following: "payable with exchange and colonial stamps added to the current rate in london for negotiating bills on the colonies." This requires the buyer of the goods against whom the draft is drawn, to pay Colonial stamp charges, exchange and interest from the date of the drafts until the approximate date of receipt of funds in payment in London or New York. [17] < \\ IM I n Future Contracts Exchange Contracts for future delivery are contracts which state that the contracting parties have purchased or sold foreign money at a specified rate of exchange for delivery and payment at some given time in the future. This sale or purchase may require delivery to be made in bills of exchange drawn at sight or time with documents at- tached, or it may call for a banker's draft, cable transfer, or either, depending on the conditions under which the contract is made. These contracts are made primarily to protect a buyer or seller against losses in exchange through fluctuation in the exchange rate between the time the merchant sells or buys the goods and the time payment is made. For example, a merchant in this country is about to purchase mer- chandise in England and the price is quoted in Pounds Sterling. He knows at this time what the cost is in dollars by changing the Sterling into Dollars at the current rate of exchange. But if shipment is not to be made from abroad for two months and payment is delayed accordingly, he must make a contract to protect himself against a fluctuation in the exchange rate. Therefore, he arranges a contract for the future delivery of Pounds Sterling at a specified rate. He can then purchase his goods knowing that at a given time in the future. Pounds Sterling will be delivered to him by the bank at the contract rate, and that the cost of the merchandise will not be affected by a fluctuation in the exchange rate. An example of an exchange sold contract, which is the reverse of a contract to purchase, or, in other words, an exchange bought contract, will be found on page 16. Many people believe that when a bank makes this kind of con- tract, that it assumes the risk that the merchant would ordinarily have to assume, but this is not so, for contracts to sell are off-set by contracts to buy, and the bank merely acts as an intermediary between the buyers and the sellers of the various kinds of exchange. Collections Payable Abroad Collection items consist largely of clean or documentary drafts. Other items such as notes, checks, foreign coupons, bonds, pension and dividend warrants also come under this classification. A large portion of foreign trade is financed by documentary collec- tions, although the virtues of a Commercial Letter of Credit are known to all engaged in foreign trade. The principal reason for this is that the buyer can usually dictate the method of payment, but under some circumstances he may have to comply with the terms of the seller. It is obvious that the seller would prefer to ship under a Com- mercial Letter of Credit as he would receive payment as soon as he presented the documents at the bank that opened the credit. He would then be relieved of further responsibility, except as drawer, if his shipment was in accordance with the terms of his credit and con- tract. Furthermore, he would not have to ask the bank to discount his draft or to loan on the collection, thereby using part of the credit facilities granted him. The reverse is true of the buyer, for when he has to open a credit he must ask credit of his bank which would doubtless lessen the amount of credit required by him for other operations. Another im- portant factor is that many shipments are sold before they arrive, and in this instance the collection is especially desirable to the buyer, for he would not require any assistance from his bank. Clean drafts are used to a great extent in adjusting open accounts, such as in making a periodical settlement of a balance arising from reciprocal shipments of merchandise over a certain i)eriod. This is especially true of business houses having branches abroad as well as long established concerns enjoying complete confidence in each other. Exphcit instructions to the bank should always accompany the drafts forwarded for collection, and for this purpose the Guaranty Trust Company of New York furnishes its clients with a form letter of instructions covering the various phases of collection, remittance, and control of merchandise for the guidance of the shippers, a facsimile of which is shown on page 21. [18] [19] il -^ f ■M '■* !l i Collections Received from Abroad Incoming collections consist of practically the same kind of items mentioned under "Collections Payable Abroad/' All of these items are governed by the regulations of the Custom House, Clearing House and Federal Reserve Bank. A letter of instructions, similar to the form on page 21, usually accompanies the collection, the terms of which must be strictly com- plied with. If a documentary draft is sent with instructions to deliver docu- ments against payment, the bank complies with these instructions and the drawee, or payor, can then clear the merchandise through the Custom House as the bank would have no further interest in the transaction. Should the customer refuse payment of the item, the bank to protect its clients abroad would clear the merchandise, cover it suflficiently with insurance and store it in a responsible warehouse. Notice would then be sent to its clients abroad, and the foreign cus- tomer would advise the disposition to be made of the merchandise. When the draft is sent for acceptance, it depends on the instruc- tions whether the merchandise is released upon acceptance or upon final payment. Usually the documents are released against accept- ance, for this gives the acceptor an opportunity to dispose of the mer- chandise before the draft matures. January 2, 19- 21 [20] GUARANTY TRUST COMPANY OF NEW YORK, 140 Broadway, New York City Dear Sirs: We enclose for r— r— the undermentioned draft with documents as enumerated. Collection The surrender of documents to drawees is conditional upon fulfillment of instructions as indicated by cross (x) in margin. DRAl-T NUMBER DOCUMENTS No. 2d8 Commercial Invoice Drawer John Brown & Co. J ' Consular Invoice Drawee Chinese Trading Co, S Bills of Lading City Where Payable Shanghai, China ) Insurance Certificate Date Aug. 7, 19:^0 — Certificate of Origin Amount U. S. $10,3J,2.10 — Weight Certificate Drawn at 120 d/d ^ — Declaration of Shipi)er INSTRUCTIONS - Paymea t- S Documents agamst . Acceptance. _^ , Non-Pavment K Protest for r^ — ^ — ^ Non Aoooptanoo i H Permit Drawee privilege inspecting merchandise before accepting draft. K Hold for arrival of goods. S Payable at collecting banks selling ^ . , rate on New York day of payment. S Payable at Check rate on New York, remitting proceeds by cable, charges for our account. K Interest to be collected at %from date of issue until approximate arrival cover in New York. S Allow Drawee interest at ?- % per annum for anticipatefl payment. __ . „ ^ . . Dpttwcp IS AH charges are for account of Drawee. S Waive charges if refused by Drawee. la In case of need refer to Americmi Export Co. Shanghd .„^,; ^^j^j,^ immediately h/^^ CabJe. S SPECIAL INSTRUCTIONS. Kindly collect this draft through the Asia Banking (^or juration, Shanghai. Yours truly. J. BROWN i& CO. [21] 1 n !f' i i li? Commercial Letters of Credit Letters of Credit came into general use only recently. A score of years ago most importations and exportations were financed by other and less favorable means, chiefly by that method under which the seller of the merchandise drew his draft on the buyer. To the seller this involved an element of risk, as he had to depend upon the responsibility of the buyer. In view of this, the banks to whom such drafts were offered for negotiation were reluctant to discount them, or would take them for collection only, and the seller was obliged to await remittance of the proceeds from abroad. The alternative to this method was that of making payment in advance for merchandise purchased abroad through remittance of funds either by mail or cable. This placed the burden on the purchaser, as he had to depend upon the assurance of the seller that he would actually receive merchandise or documents representing a shipment of merchandise. Which of these two methods was employed depended upon whether the buyer or seller was in the position to dictate terms. Under either of these methods the burden of financing the merchandise in transit generally had to be borne by one of the two parties directly interested. These disadvantages served to retard rather than to stimulate trade. Through the adoption of bankers' commercial Letters of Credit, the buyer and seller no longer view each other with uncertainty, and neither is obliged to tie up his capital while the goods are in transit. The principal advantages of such Letters of Credit are: (1) The seller has the guarantee of the bank issuing the credit that drafts drawn will be honored, provided he fulfills the conditions of the credit. (2) The buyer has the assurance that he will receive value in the form of documents representing shipment of merchandise. (3) The seller has no difficulty in discounting his drafts with his local bankers; while the buyer does not pay for his purchase until the arrival of the documents, or perhaps later. All commercial credits come under two general classifications: "Clean" or "Documentary." Drafts drawn under a "clean credit" are negotiated without documents, while drafts drawn under a "documentary credit" must be supported by the relative shipping documents specified by the terms of the credit. Letters of Credit are either "revocable" or "irrevocable," depending on whether the establisher of the credit reserves the right to revoke it before its stated date of expiration. [22] The Revocable Export Credit On page 24 is shown a form of a sight export credit, opened by a foreign buyer through the Guaranty Trust Company of New York, in favor of a manufacturer, exporter, or shipper in the United States. The specimen shown is a sight revocable credit, which means that although a date of expiration is placed on the credit, it is, nevertheless, subject to cancellation at any time. We do not advise the acceptance by American shippers of a revocable credit, in view of the great danger of having it cancelled after the merchandise is shipped and before payment is effected. The preferable method is for the American exporter to utilize irrevocable or confirmed credits. The Irrevocable Export Credit On page 25 is shown a specimen of a sight irrerocahle export credit op^ened by one of our foreign correspondents for account of a foreign buyer in favor of a firm of exporters in the United States. This credit differs from the sight revocable export credit, shown on the pre- ceding page, in that, as a sight irrevocable credit, it cannot be cancelled prior to the date specified in the credit, without the consent of the party in whose favor it is issued. This form of credit is the best and safest method for the American shipper. Once having received the credit, he can proceed with the shipment of the mer- chandise with full knowledge that his drafts will be paid, provided the terms of the credit are strictly fulfilled. In this connection, it might also be well to point out that American b^ks in issuing export letters of credit are acting merely as agents for their foreign correspondents and are not in any way authorized to alter the terms or conditions of the credit. It is well, therefore, that the American exporter take up any irregularities or points which he feels are not in accordance with his contract before eflFecting shipment, so that these matters can be adjusted prior to the presentation of the documents. ■ r [23] i :ii Fifth Avenue Office Ftf th Avenue and 43r« St. Madleon Avenue Office M Art t son Avenue and CQiiiSi CaMc AddrMa.'Pid.btu" Guaranty Trust Company of New York 140 Broadway Capital ^ 25,000.000. Surplus $ 25.000,000. Msmber of Federal Reserve System Cable Address'Fidelitas" London Office 32 Lombard Street. E C Cafel* Addrpsatiamiua' New York February 26, 1920 Paris Office Rue dea Iiallens i A 3 Cablr Addrvss"C*rr ^^ ^^ *^' order of the Banco MercantU Americano de Colombia Seaworthiness admitted as between insurer and insured. This Letter of Credit is VaUd only upon there having been issued an appropriate Export License, covering the transaction. It must be understood that payments under this Credit will only be made provided the goods are actually on board or loading on the Vessel named in the B/L. If Government regulations restrict the issue of order Bills of Lading, please communicate with us and we will advise you in the premises. Marine insurance should cover from Warehouse to Warehouse, and not less than ten days after arrival, and also include deviation clause, craft and lighter clause, negligence and /or latent defect clause. Policies reading Free of Particular Average completely, must not be tendered without prior arrangement with us. This Letter of Credit is issued subject to all regulations and enactments of the United States Government and its Alhes and to any proclamations of the President governing export shipments. The documents should be presented whenever possible in time to be forwarded on the steamer carrying the merchandise. This Letter of Credit expires '^^^^ ^^> ^^^^ unless sooner revoked. If you are unable to comply with the terms as indicated above, please communicate with us promptly, and oblige, Yours respectfully. Guaranty Trust Company of New York [24] Fifth Avenue Office Fifth Avenue and 43!4 St. Ca>M« A ^^^^- If you are unable to comply with the terms as indicated above, please communicate with us promptly, and oblige. Yours respectfully. Guaranty Trust Company of New York [25] f |i Import Credits The modus operandi of an Import Letter of Credit and the several steps leading up to the opening of an Import Letter of Credit, as viewed from the buyer's stand- point, are as follows: (1) Negotiations between buyer and seller regarding merchandise, terms of sale, methods of payment, etc. Upon closing the contract it is agreed that payment will be made by draft drawn against approved bank's Letter of Credit. ( (2) The buyer applies to his bank for a Letter of Credit (see specimen of application form). (3) Credit issued by the bank; beneficiary notified either by mail or cable; client signs "obligation form," agreeing to protect the bank in con- sideration of its having issued Credit. (4) Seller prepares merchandise for shipment, obtains bills of lading from steamship company, as well as consular invoice certified by U. S. Consul, and other requisite documents; then submits draft and docu- ments to his local bank for negotiation. The local bank discounts the draft and the seller receives the proceeds immediately. (5) Draft, with documents attached, is remitted by foreign bank for presentation to the Guaranty Trust Company of New York. Upon pres- entation, the documents are examined to determine if the conditions of the Credit have been complied with; upon verification, draft is ac- cepted and client is notified of acceptance of the draft and arrival of the documents. (6) Client applies to the bank for surrender of the documents which is made under one of several conditions, viz. : A. Against the payment of draft; B. Under a temporary arrangement to enable client to warehouse mer- chandise and deposit warehouse receipts with bank. In this in- stance client signs a " Trust Receipt for Warehousing" (see page 54). C. In the event of goods being sold, the merchandise is released tem- porarily without payment to enable the client to effect delivery to purchasers; and proceeds of sale to be used to liquidate outstand- ing drafts; clients signs "Trust Receipt for Purchaser" (see page 53). Occasionally client, upon rendering invoices to the parties to whom he re-sold the merchandise, will stamp such invoices " Trans- ferred and made Payable to Guaranty Trust Company of New [26] York— Remit Payment direct to it." Under this latter arrangement the client will sign a form of Trust Receipt known as "Bailee Receipt" (see page bb^ at the time the bank surrenders the ship- ping documents to him. The documents are sometimes released under a general Trust Re- ceipt; i.e.: the merchandise is held by the client in trust for the Guaranty Trust Company of New York. This form of Trust Receipt is not quite as specific as the previous forms mentioned as to the disposal of the merchandise. All of the forms, however, agree in the following details: The title to the merchandise is vested in the Guaranty Trust Company of New York until the drafts are paid; the drafts will be paid at maturity; and in the event of the merchandise being sold prior to maturity, the bank will receive the proceeds of the sale. One point not previously discussed, which may have come to the notice of the reader, is the method of reimbursing the bank abroad which originally discounted tlie draft. At the maturity of the draft this bank's account with the Guaranty Trust Company of New York, or that of the bank to whom the draft was remitted for collection, will be credited with the face amount of the draft. Frequently the remitting bank avails itself of the privilege of having the draft discounted, and the proceeds immediately placed to the credit of its account instead of waiting until maturity. Current funds for the payment of a draft due in New York should be available to the drawee bank one day before maturity. If the draft matures abroad, time should be allowed for the transmission of the funds. On the succeeding pages are shown an Application Blank, Specimen Letters of Credit, Obligation Forms, Trust Receipts, etc. on many of which the text will l)e found self-explanatory. With regard to Letters of Credit issued in Pounds Sterling, it will be noted, upon consulting the specimen shown on a succeeding page, that the drafts are drawn on the Guaranty Trust Company of New York, London, instead of New York, as is the case with dollar credits. One set of documents accompanies the draft to London, and the remaining documents are forwarded direct to New York from the point of shipment to insure receipt of documents at about the same time as the merchandise. Letters of Credit drawn in other foreign currencies operate in about the same fashion as Sterling Letters of Credit; drafts, however, in this case are drawn on Foreign Correspondents of the Guaranty Trust Company of New York, and accepted by them. [27] it n « H H H H o Q as H fa CO Z n o » u O H < O •J < Guaranty Trust Company of New York APPLICATION FOR LETTER OF CREDIT c > «< H Q S ><* n >-' o n H o Oi H < t^ eu C u H « B cu O a H H K tf O O >-' n >^ o PQ H O « H ;< M Ot U H u s< s eu o H H •J iJ n pq -< << u u New York, _ Guaranty Trust Company of New York Foreign Department ^^P2r? Division New York City Gentlemen; Please issue an Irrevocable Letter of Credit by For account of In favor of — Jan. 2, 1921. cable John SmUh and Co., Buenos Aires, Argentina sight Amount ^iO^OOO-OO available by drafts at (sight, thirty, sixty or ninety days) against documents as follows: Bills of Lading reading Bills of Lading * * Received for Shipment' ' or otherwise worded to same Invoice effect are acceptable against this credit. Consular Invoice other documents ^ ~" " " ' Full invoice value of C. L F., C. fit P., R 0. D., P. A. 0, Shipments^ covermg 75% (croes out all but one) 800 Bags Coffee Buenos Aires to be shipped from Drafts to be negotiated on or before- Insurance to be effected by -to- New York City March 31 , 1921 . Shippers Partial shipments are to be permitted. Special Instructions (Shipper or Purchaser) J The Letter of Credit is subject to your usual terms and conditions, and in consideration of the issuance thereof we agree to reimburse you on demand, and we hereby authorize you to charge our account with you with any and all amounts for which you are liable thereunder, plus your commission and charges. Neither you nor your correspondents shall be responsible for the description, quantity, quality or value of the merchandise shipped under this credit, nor for the correctness, genuineness or validity of the documents, nor for delay or devi- ation from instructions in regard to shipment, nor for any other cause beyond your control. Very truly yours. The Guaranty Trust Company of New York does not assume responsibility for any inaccuracy, interruption, or delay in the transmission or delivery of messages — by cable. [28] John Smith and Co.. New York City Import Letter of Credit (Dollars) Credit No._?M?Z p^^ S100,000~UJS.C. Messrs. John Doe & Company, Guaranty Trust Company of New York Foreign Department New York,. February 11, 1921 Yokohama, Japan Gentlemen; At the request and for the account of ^^''''' "^^^^^ ^ Crawford & Company, New York — we hereby authorize you to value on Guaranty Trust Company of New York, New York by your drafts at /^o^r U) Months sight f^^. ^^^ ^^^ ^^ ^^^^ ^^^^ exceeding a total of One hundred thousand dollars ($100,000) accompanied by commercial invoice, consular invoice, bills of lading Marine and war-risk, in- surance certificates r^pr^Q^nting co^^> insurance and freight g hjpment »f Raw Silk from Yokohama, Japan, to New York Insurance Marine and war-risk insurance to be effected by the shippers Bills of lading for such shipments must be drawn to the order of The Guaranty Trust Company of New York, unless otherwise specified in this credit. A COPY OF THE CONSULAR INVOICE AND ONE BILL OF LADING MUST BE SENT BY THE BANK OR BANKER NEGOTIATING DRAFTS, DIRECT TO THE GUARANTY TRUST COMPANY OF NEW YORK NEW YORK. THE AMOUNT OF EACH DRAFT NEGOTIATED TOGETHER WITH THE DATE OF NEGOTIATION MUST BE ENDORSED HEREON. We hereby agree with bona fide holders that all drafts drawn by virtue of this Credit, and in accordance with the above stipulated terms, shall meet with due honor upon presen- tation at the Guaranty Trust Company of New York, New York, if drawn and negotiated on or before ^^1/ 31, 1919 Guaranty Trust Company of New York N. B. — All drafts drawn under this Credit must bear clause "drawn under G. T. Co. of N. Y. Letter of Credit No. J^^^^J— dated New York, ^^^- ^^^ ^^^^ " to cover shipment of- Yokohoma ±^ New York Raw Silk -from [29] Iiii Dollar Import Letter of Credit Agreement - — pay to the order of OURSELVES m-^m m -ML »....«»-■«» — m m s m = as s- 1/OllftrS Uinety day^— 7..--3'|.-— jj. FifJ:pQn^hqj«and^iair£i'§:^^ Thc^bligatij^ |f th j a fcc ep ^- liemtfjnaes out of the purchase of goods from the drawer, maturity beifl in coi^i^tyci/ith o^^flial ^nrof imrchaae. The drawee may accept this bill payable at any^Bsnk. tnial con^ipAy o^D^eft Mfice in the United States which he may designate. ■< ?» as ^^ g.-sf ToJB rami, §l&q k_^o,_^ 11 . a. Blan^^ii^Cp.^ pLS7 r|lOyi^£Strfie|^. (SiinatuM of dra««r ) v^^a r]c> Troas. -orr I Form of Trade Acceptance Based on Domestic Sales of Merchandise This form of acceptance is daily becoming more popular. It eliminates the old system of "open accounts." Instead of a merchant selling to a buyer on 60 days open account, the buyer accepts a draft at 60 days date or sight which the merchant can discount with his bankers, thus avoiding a tie-up of his capital. The Guaranty Trust Company of New York is always ready to consider the discounting of trade acceptances. To those who are not fully familiar with the advantages to be gained by using trade acceptances in their business we shall be pleased to send full information on this subject. f> [42] Ik. r- c o t % « S\ 9> M« Qftl«Mtoa,. 14w York. ^ZY., lanua y lO^-h, 191-9- Ninety d8ya---.--Q'*-»-^----«^i:^-after 4aue»--. - -pay to the order of OURSELVES l« I '-gtrifiy^i^ij 00/lQO*„ •_»- « j» -^ * _- -• « » ^ «r « ~ » - Dollars Th^bligati^ |f thS^ceptbrtiei^tfirises out of the purchase of goods from the drawer, maturity beiia in corflfoHnityrVith ongfiial M^te'of purchase. The drawee may accept this bill payable at any^ank, tni8|com(^y oi^b^ke^Mlice in the United States which he may designate. To Browrty jllack & f o . ^ PQ _. _.J*1157 r^Oth,,gSt,rae|,. ^ -C^W^ 9^%^/'^'// r///// rA////if //'//rr/^f/^/^^ rZO #- r,,...Ae . - New, .lork „. 0«lT«8ton Cotton Coispanj', 71a«-Pr««ld«ni. i Form of Bank Acceptance Not Based on Imports or Exports to or from the United States This form of acceptance is used in connection with accept- ance credits (not letters of credit) granted for the purpose of financing stocks of staple commodities stored in warehouses, and documentary drafts forwarded for collection. To those who are not familiar with acceptance credits, and not fully aware of the importance of such facilities, the Guaranty Trust Company of New York will be pleased to send additional booklets which contain full explanations regarding accept- ance credits and acceptances. 1431 n ^ Advances, Time Loans and Loans Against Collections Advances Advances are practically loans payable on demand, and are made: To finance merchandise being prepared for export, usually se- cured by domestic Bills of Lading or Warehouse Receipts; To finance exports of various commodities, payment for which will be made abroad, upon delivery of the relative documents; To finance, under a bank guarantee, a customer residing abroad. To finance a foreign customer against deposit of suitable securities with a bank abroad for our account; To finance imports between time of arrival of merchandise and delivery to purchaser. Time Loans Time loans are made under the same conditions as those men- tioned above, except that they have a definite maturity. Collection Loans Collection loans may be advances or time loans. They are se- cured by documentary drafts forwarded for collection. When advice is received that the item is paid, the loan or a part thereof is liquidated. Shipping Documents A complete set of shipping documents consists of: Invoice. Complete set of Ocean Bills of Lading. Marine and War Risk Insurance certificates or policies in duplicate. Consular Invoice. Other documents, such as an Inspection Certificate, Analysis Certificate, Weight Certificate and Certificate of Origin may be re- quired, according to the terms of sale, the kind of product shipped or the destination of the shipment. However, the majority of ship- ments require only the four documents previously mentioned. Invoice The invoice usually contains the following data: Date. To whom invoiced; name and address. Name and address of Consignee. How shipped, name of steamer and route. Description of merchandise. Terms of sale. How packed. Weights, gross, tare and net. Invoice price and how figured. Discounts or other deductions from invoice price, also petty charges or additions all itemized. Marks and numbers. \\ n [44] [45] Ilk. (il II Bills of Lading (Abbreviation B/L; plural BS/L) An ocean bill of lading is tbe most important of the shipper's papers. It is customarily drawn up by the shipper on forms which the carrier supplies, and which are signed by the latter after deUvery of the dock receipt and the shipper's manifest. Besides being the final receipt from the carrier, the ocean bill of lading constitutes a shipping contract between the carrier and shipper. It becomes a negotiable document, and may be used by the shipper as the basis for a draft if it is drawn to his order. It is not the usual practice, however, for the ocean bill of lading to be drawn in the consignee's name unless he has a special agreement with the shipper, or unless advance payment has been made or security arranged before shipment. The basis of financial settlement most commonly employed in foreign trade is by drafts, or bills of exchange, to which have been attached a shipper's invoice, insurance policy, and ocean bill of lading. The number of copies of the bill of lading required vary according to the nature of the transaction. Banks, if settlement is to be made by draft, will require two or more negotiable copies and the possession of all the negotiable copies. Non-negotiable copies will also be needed by the shipper, the carrier, and the consignee for filing, and by foreign consuls to meet the provisions of the law. An export bill of lading is used in cases where the exporter at an inland point wishes to bill his goods from point of shipment to foreign point of receipt, port or interior. By obtaining a through bill of lading from a railroad the exporter obviates the necessity of securing a railway bill of lading to the export port, and then an ocean bill of lading to the foreign port of receipt. The export bill of lading consti- tutes a triple contract, covering: (1) Shipment by rail or water to port of export; (2) Shipment by sea; (3) Shipment from foreign port of entry to inland destination. A parcel receipt is issued by ocean carriers to expedite the transportation of small packages, most commonly samples, although general merchandise is so shipped on occasions. The value, weight, and dimensions of the goods carried are restricted. Parcel shipments are designed to avoid the high rates that would have to be paid for small lots of goods under the minimum freight charge usually stipulated in ocean bills of lading, imder which nothing less than a ton rate or a specified amount would be accepted, no matter how small the consignment. Numerous ship- ping lines are now using these receipts. The matter of bills of lading is so complex and includes such a multitude of conditions governing the shipment of merchandise that it is impracticable here to reproduce the numerous forms that are in use by the shipping companies or to dis- cuss the whole subject in detail. Ocean Bills of Lading are not uniform like railroad bills of lading. Each steamship company has its own form and conditions according to the countries between which its steamers run. Entirely different bills of lading, for instance, are used for shipments to South America and for those destined to France or England, although both bills of lading may be issued by the same steam- ship company. [461 IIl Marine Insurance A set of shipping documents is never complete without a Marine Insurance Policy or Certificate, as both by law and by the contract provisions of their bills of lading ocean carriers have a greatly limited liability. Marine insurance not only affords protection to the shipper, consignee and banker, but is also an economic factor in the price of goods since it eliminates the risk of loss to the consignor in case of non-delivery. It is a necessary factor in negotiating credit on a consignment. A marine insurance policy is very explicit in its limitations. Ordinarily it pro- vides for payment only in the event of total loss of the shipment through "perils of the seas." Such insurance is usually not acceptable to bankers who require that at least partial loss or damage to the shipment through "j>erils of the seas" be insured. In most cases this can readily be included by insertion on the insur- ance certificate of a "Particular Average" clause. In addition to covering loss due to "jjerils of the seas" marine insurance can by agreement be made to include loss through "breakage and leakage" and "theft and pilferage" of cases, barrels, etc. or their contents. The amount of insurance may include freight rates and profits, but usually it is the invoice value of the shipment plus twenty per centum. Unless specifically stated it is understood that the shipment is going forward "under deck." If a shipment is made "on deck" the insurance certificate must so specify. In the case of shipments "on deck" the insurance is only against total loss due to "perils of the sea" and the insurance is not subject to claims for in- jury or damage due to the elements. Such shipments may, however, be made to include loss due to "jettison or washing overboard." Bankers require certificate or policies of insurance issued by responsible insur- ance companies, and "brokers certificates" are not usually accepted. As the papers covering shipments are usually negotiable, especially the insur- ance certificates, it is indispensable that the ownership, in case of loss of the ship- ment, be vested in the holder of the documents. For this reason the endorsement on certificates should be made in blank. This procedure simplifies matters in the event of a claim. There are various policies under which marine insurance is written. In some cases foreign buyers instruct the shipper to insure under their open policy, in which event a notification is sent to the agents of the company, who issue a certi- ficate or acknowledgment. Under other circumstances shipments may be insured under separate policies issued to the shipper on each shipment. The most convenient and simple method of providing insurance is under an "open policy" issued to the shipper. Details relating to each shipment are furnished to the company who issued the policy, and a certificate is prepared. Sometimes the shipper is authorized to prepare and issue certificates on behalf of the company with whom the "open policy" was placed. [47] Insurance is sometimes placed by freight forwarders; otherwise the shipper secures it directly from insurance companies or through insurance brokers or agents. The Guaranty Trust Company of New York maintains a special advisory department to assist its customers and others to secure satisfactory insurance protection at the most favorable rates; select reliable brokers and companies; adjust and collect losses promptly, and aid or advise in all matters pertaining to insurance or shipping. Many losses are incurred through "general average." Therein lies the entire theory of marine insurance. "General Average" is based on the principle that, if a voluntary sacrifice is made of a vessel, its equipment, the cargo, or other prop- erty, for the common welfare and safety or benefit of all concerned in the ship and its cargo, the entire loss should not be borne wholly by the owners of the sacrificed property, but should be borne by all interests benefiting by the sacrifice, and each should contribute proportionally. When a voluntary sacrifice has been made, the owners of the vessel appoint average adjusters, who draw up what is called a general average statement. This lists the disbursements made and the sacrifices incurred and distributes over the various interests involved, viz., freight, cargo, and ship, the contribution due from each interest. Payment of the estimated contribution is demanded by the steam- ship agents before the cargo is delivered to consignees. Such payment is usually made by the consignee, who is later reimbursed by the insurer or is guaranteed to the steamship agents by the insurers. "Particular Average" is loss or damage sustained by an individual shipment through ordinary sea perils which falls wholly on the owners of the property dam- aged or its insurers. Such losses occur through unavoidable accident and not through destruction in order to save other property. Claims for losses may be made in several ways. One method is to forward the necessary documents to the shipper. Another is for the holder of the documents to file claims with the nearest agent of the insurer. The most satisfactory method is to request a well equipped bank or banker to undertake collection of the claims. The papers usually required by insurers or underwriters are the following: (a) The insurance certificates which must be properly endorsed, (b) the original and all negotiable copies of the bill of lading, (c) the survey report made by the local representative of Lloyds of London, at the port of arrival, (d) the original invoice or a certified copy thereof, (e) wherever possible a copy of the Master's Protest, and (f) in case of total loss a certificate of lading from the steamship company. The Guaranty Trust Company of New York is especially equipped to undertake collection of claims. Consular Invoice New York, JFsruUTd de mercancias emharcadas por 19^ a bordo de (Name of Vessel) por cuenta y riesgo de (Consignor) con destino a. (Port) (or who's account and risk shipment is made) y a la consignacion ^^ (Consignee) MARCAS (marks) NUMEROS (nttmbebb) NUMERO DE BULTOS (number of packages) DESCRIPCION (description) (detailed contents component materials) Peso Bruto Gross Wgt. KILOS Peso Neto Net Wgt. KILOS PRECIO PRICE, VALOR VALUE • , Declaro que soy el de las mercancias relacionadas en la presente f actura y que son ciertos los precios y demas particular^ que en ella se consignan, *y que 1^ mercancias contenidaa en dicha factura son productos del suelo 6 de la industria de los Estados Unidos de America. •If merchandise shipped is from any country, other than the United States, remainder of above declaration should be cancelled. Declaro que soy el Agente autorizado por Don que ha suscrito la anterior declaraci6n, para presentar esta factura en la Oficina Consular de Cuba en esta plasa, d fin de que sea certificada. [48] The careful preparation of a consular invoice is most essential. Duties are often levied on the weight of an article and not on its value, and an in- correct description may cause the foreign buyer to pay greatly increased import duties. Therefore, to avoid trouble and the possible rejection of merchandise, particular care should be given to the preparation of this document. Some countries also have special regulations with regard to bills of lading, and in many instances "order" bills of lading are not allowed. Information with regard to these matters can generally be obtained at the consulates of the various countries. [49] k .il3l 4 \i TRUST RECEIPT i i- Trust Receipts Trust Recei[)ts are sometimes accepted as temporary col- lateral from responsible customers, in exchange for shipping documents or warehouse receipts. They are used to permit the American exporter to ex- change his inland documents or warehouse receipts for ocean documents, or vice versa, to permit the importer to exchange his ocean documents for warehouse receipts or railroad documents. They are also used when a merchant withdraws collateral which has been pledged as security for a loan, for the purpose of sale or shipment. The substance of these receipts is simply that the mer- chandise remains the property of the bank, and is released to the customer on his promise that he will deliver to the bank within a given time, other documents representing the same merchandise or the equivalent in cash. Another important stipulation is that the merchandise will at all times be covered by insurance. [50] J^ttVVHtu from The Guaranty Trust Co. of New York the following goods and mer- chandise, their property, specified in the Bill of Lading per S.S Dated —marked and numbered as follows; {Space is left here for description of merchandise) and, in consideration thereof, < — ? hereby agree to hold said goods in trust for them, (we) and as their property, with liberty to sell the same for their account, and further agree, in case of sale, to hand the proceeds to them to apply against the acceptances of The Guaranty (my ) Trust Co. of New York on ^ — \ account, under the terms of the Letter of Credit our ) No.. mme ours -issued for < — > account and for the payment of any other indebtedness of our) to The Guaranty Trust Co. of New York. The Guaranty Trust Co. of New York may at any time cancel this trust and take possession of said goods, or of the proceeds of such of the same as may then have been sold, wherever the said goods or proceeds may then be found and in the event of any suspension. or failure, or assignment for the benefit of creditors, on my our part, or of the non-fulfillment me of any obligation, or of the non-payment at maturity of any acceptance made by < — [ under ( us ) said credit, or under any other credit issued by The Guaranty Trust Co. of New York on my ) ^ ( my ) — ( account or of any indebtedness on < — ? part to them, all obligations, acceptances, 'our) our indebtedness and liabilities whatsoever shall thereupon (with or without notice) mature ( my ) and become due and payable. The said, goods while in < — \ hands shall be fully insured (our) against loss by fire. Dated, New York City -192. (Signed). Stg. Note. — This form is used when the merchandise is entrusted to the merchant for purpose of sale. All payments whether partial or complete should immediately be handed to the bank regardless of the fact that the obligations for which the merchandise is col- lateral may not be due, [51] (' I I I4i 1^1 TRUST RECEIPT New York Citv 192 Uttmti from the GUARANTY TRUST COMPANY OF NEW YORK the following goods and merchandise specified in the documents described below, and in consideration thereof I/we hereby agree to hold said goods in trust for it and as its property and to deliver over to the said Trust Company or its assigns the ocean bills representing the goods and merchandise described below, or other negotiable documents, or the proceeds of the sale of the goods and merchandise set forth in the said documents; the delivery herein being tem- porarily made to me/us for convenience only, without novation, or without giving me/us any title to the documents, or the goods and merchandise they represent, except as trustee and agent for the said Trust Company and except to eflFect the exchange of said documents for ocean bills of lading, or to receive the proceeds thereof for the account of said Trust Company. The said Trust Company may at any time cancel this trust and take possession of said goods and merchandise or of the proceeds of such of the same as may then have been sold, wherever the said goods and merchandise or proceeds thereof may then be found. The said goods and merchandise while in my/our hands shall be fully insured against loss by fire and any other risk that said goods and merchandise may be subjected to. I/we hereby agree to deliver said ocean bills of lading, or to pay the proceeds arising from the sale of the said goods and merchandise, to the said Trust Company on or before DcU^ Signed, Note. — This form is used in connection with export credits and loans. It will he noted that the shipper obligates himself to the Guaranty Trust Company of New York to hold the merchandise in trust for it and as its 'property, and to deliver over to said Company or its assigns, the ocean hills of lading representing the goods and merchandise as described in the Trust Receipt itself. It will also be seen that the party signing the Trust Receipt agrees either to deliver the ocean documents called for, or to return the documents given to him in trust, or their equivalent to the Trust Company. [52] TRUST RECEIPT (FOR DELIVERY TO PURCHASER) ViBttxnth from The Guaranty Trust Co. of New York the following goods and merchandise, their property, specified in the Bill of Lading per , dated marked and numbered as follows: (Space is left here for description of merchandise) In trust to deliver the same to. who have purchased the same for. e in. payabl and to obtain from the purchaser the proceeds of the sale of the same. me In consideration of the delivery of said goods to in trust as above 1 agree to us ) (we deliver them immediately to the said purchasers, and to collect the proceeds of sale, and imme- diately deliver such proceeds to The Guaranty Trust Co. of New York in whatever form col- lected, to be applied by them against the acceptances of The Guaranty Trust Co. of New -issued for \ my / York on } — > account, under the terms of Letter of Credit No (our) — > account, and to the payment of any other indebtedness of J > to The Guaranty our ) ( ours ) Trust Co. of New York. It is understood, however, that if such proceeds be in notes or bills receivable, they shall notbe so applied until paid, butwitli liberty meanwhile to The Guaranty Trust Co. of New York to sell or discount, and so apply net proceeds. The Guaranty Trust Co. of New York may at any time cancel this trust, and they may take possession of said goods until the same have been delivered to said purchasers and the proceeds of sale received from them, and thereafter of such proceeds, wherever the said goods and proceeds may then be found, and in the event of any susp part or of the non-fulfillment of any obligation our) or of the non-payment at maturity of any acceptance made by me us under said credit, or any other credit issued by The Guaranty Trust Co. of New York on my our account, or of any indebtedness on ] — > part to them, all obligations, acceptances, indebtedness, and liabilities (our) whatsoever shall thereupon (with or without notice) mature and become due and payable. Dated 192 Note. — This form of Tru^t Receipt is used covering the delivery of merchandise actually sold, and is also used in connection with Import Letters of Credit, the relative shipping documents being surrendered to the client against his tru^t receipt in order to enable him to make delivery to the buyer. [53] TRUST RECEIPT BAILEE RECEIPT (DOCUMENTS FOR WAREHOUSING) l^HiXnth from The Guahantt Trust Co. of New York Bill of Lading per "**^^ for the following goods and merchandise, their property, marked and numbered as follows: imported under the terms of Letter of Credit No.. ., issued by them for me my> , i"*^f — > account the said Bill of Lading to be used by ] — > for the sole purpose of entering the our ) ( us ) above described property at the United States Custom House at the Port of and of storing the same in the name, and as the property, of the said The Guaranty Trust Co. of New York, and subject only to their order, < — ( we hereby agreeing to so store the said property and to hand the storage receipt for the same to the said The Guaranty Trust Co. of New York, when obtained. I ) — > ALSO AGREE to fully insure said property against fire, the loss, if any, payable to said The Guaranty Trust Co. of New York, and to hand to them the policies of insur- ance thereon. Dated^ ; 192 k (Signed). £. Note. — This form of Trust Receipt is also used in connec- tion vdth Import Letters of Credit^ and it is temporarily accepted against the surrender of shipping documents, in order thai the goods covered by such documents may be placed in warehouse, and pending the delivery of the warehouse receipt. [54] ISitttXXiti from the Guaranty Trust Company of New York solely for the purpose of selling same for account of said Company: marked and numbered. and. -hereby undertake to sell the property herein specified, for account of the said Company y and collect the proceeds of the sale or sales thereof, and deliver the same immediately on receipt thereof to the said Company, to he applied to the credit of . hereby acknowledging. Company, and .to be Bailee of the said property for the said do hereby assign and transfer to the said Company the accounts of the purchaser or purchasers of said property to the extent of the purchase price thereof, of which fact notice shall be given at the time of delivery of the said property by to such purchaser or purchasers and all invoices therefor shall have imprinted, written or stamped hereon by the following: "Transferred and payable to GUARANTY TRUST COMPANY OF NEW YORK, llfi Broadway, New York.'* If the said property is not sold and the proceeds so deposited within ten days from this date, ■ undertake to return all documents at once on demand, or to pay the value of the goods, at the Company* s option. \ mv # The said goods while in ) — > hands shall be fully insured against loss by fire. ( our) The terms of this receipt and agreement shall continue and apply to the merchandise above referred to whether or not control of the same, or any part thereof, be at any time restored to the Guaranty Trust Company of New York, and subsequently delivered to us. Dated at New York City, 192 Note. — This form of receipt is very specific as to the terms and conditions under which possession of merchandise is obtained. [55] i I - 1 Bankers Foreign Drawings The Guaranty Trust Company of New York grants facilities to its correspondent banks in the United States and abroad, which enable them to draw, under its protection, on its foreign correspondents in all parts of the world. To those desiring to utilize this service the Guaranty Trust Company is pre- pared to furnish a Book of Correspondents covering practically the whole of the commercial world. This volume contains instructions relative to the methods to be followed in drawing these drafts and also indicates how the varying require- ments of banks in the diflFerent nations may be met. Correspondent banks may use their own draft forms, but to those not possessing specially engraved checks suitable for this purpose, the Guaranty Trust Company furnishes appropriate forms, free of charge, upon which is imprinted the name of the issuing bank. The name of the Guaranty Trust Company does not appear thereon. Rate lists are furnished daily to those using these facilities, together with our buying rate for the principal foreign currencies, either gold, silver, or notes. Post Remittances Drafts are not always suitable for effecting the payments required by immi- grants, particularly in connection with family payments to Italy, Austria, the Balkans, Scandinavian countries, and Asia Minor, where the beneficiaries fre- quently are living in villages and small towns, and where there is often an entire absence of banking facilities. To meet these requirements we have inaugurated a Post Remittance Service, by means of which payment in the currency of the country is effected through our correspondents, directly at the address of the payee. For this purpose special forms are furnished, supplementary to the ordinary draft books. h Travelers Checks "Dollar" Guaranty Travelers Checks are issued by this company in denominations of $10, $20, $50, and $100. These checks will be cashed in all parts of the world, at the buying rate for demand drafts on New York, on the day of pres- entation. The advantage of our "Dollar" Guaranty Travelers Checks over checks cashable at a fixed rate of exchange lies in the fact that the holder receives payment at the rate of exchange prevailing on the day of encashment, which can be accepted or declined. The form of Guaranty Travelers Checks is illustrated on the following page. I! [56] [57] h •i — : .—-♦ ^ V .y '»' V TRAVELERS CHECK M«weCR'S •••NATUMC Guaranty Trust Com 0»» »T» WAY WtU MY TO THE OROCR OF «9IN UNITCOSTAT TWENTY DO N9 000000 mn< Newlbrk r^ < IN OTHER COUNTRIES -v«i AT BANKERS BUYING RATE OF EXCHANOE FOR CHECKS ON NEWVORK- - — ^CRSON WHOSK »t&MATUMK Am^CAX* AaOVS Guaranty Trust Company of NewYOTk il T)*% mOvcsn mv«t •»•«• H«<»c IN M»csftMC« o* MVr>M« «r*iccn ^ *-7>.v- *-^r;x-;-*^'^^A: .\m>kka> ii^vh >»*r» I Form of Guaranty Travelers Check Traveler's Letters of Credit The Guaranty Trust Company of New York issues Travel- er's Letters of Credit in DOLLARS POUNDS STERLING FRANCS These Letters of Credit are a convenient and desirable method of providing for the financial requirements of travelers. Funds can be obtained against these Letters of Credit from our correspondents in all parts of the world, a complete list of whom is furnished at the time of issuing the Letter of Credit. In the case of "Dollar" Letters of Credit reimbursement is obtained through demand drafts on our oflSce in New York; "Sterling" Letters of Credit by demand drafts on our Lon- don office, and "Franc" Letters of Credit by drafts on our Paris office. In the following pages are reprinted facsimiles of Letters of Credit in their various forms. • [58] [59] INTENTIONAL SECOND EXPOSURE I Form of Guaranty Travelers Check Traveler's Letters of Credit The Guaranty Trust Company of New York issues Travel- er's Letters of Credit in DOLLARS POUNDS STERLING FRANCS These Letters of Credit are a convenient and desirable method of providing for the financial requirements of travelers. Funds can be obtained against these Letters of Credit from our correspondents in all parts of the world, a complete list of whom is furnished at the time of issuing the Letter of Credit. In the case of "Dollar" Letters of Credit reimbursement is obtained through demand drafts on our oflfice in New York; "Sterling" Letters of Credit by demand drafts on our Lon- don oflSce, and "Franc" Letters of Credit by drafts on our Paris office. In the following pages are reprinted facsimiles of Letters of Credit in their various forms. I i [58] [59] In m Guaranty Tmstuomjia^ Clrcalar Letter of Credit ^0000 /fc^:f A i liS]; I,-, * r ■■■M in in 'r- »[ ^. :h---^""- '"'•I'^'Tn / IN ViroKi>B #ri M^,Q<^tw^j^H£/ 5iik'i)iiiii] •<1? — ^, Vq ooi ■rH" iiiii ^. ,• i -: arried forward ' ' 1. - \ ■ '-rr-^M *i I! if \ ft I Traveler's Dollar Letter of Credit Reimbursement through Dollar Drafts on New York [ B^RONT ] [60] Traveler's Dollar Letter of Credit Any amounts paid against this credit are endorsed on the Letter of Credit by the paying bank [ BACK ] "^ [61] I INTENTIONAL SECOND EXPOSURE i 'fe^.' |isj| ^1' liiiPiiiiiiiiiiSiiiiiiiliilil! Guaranty Trust Company of Newtbrk Circulnr Letter of Credit s, y/r 0000 .J 7 IP' frr A^ff V^/w?'/// fY/M//' .^y/l^te-C^ Mmi^jR}!!^. :^ ^ ,.. ^^ _ H Guaranty Trust Comjmiiydfjrevr '/anmAr /mf/mrfey^Of/r ! r;.^ sill . >yj^y//A^//'/'v^ ■Ifi '#ui^L i-.,; c,?tC\^ P^ vy^y^vmrjtm' 'jmfj^f'' .^< /Uj/z/^/ik/ ^,:^r^r'/rf:ij4f///^'?/// i^ i teBPSiliiiiililiF":'"'^ -liiiis a. fi^^p' iiiiiiiiiiiiiiiiiiiiiiiiiiiiiir^^ •,i r't3 SFBCIKICATION OF ALL PAYMBNTS MADE UNDER THIS LETTER OF CREDIT. (Please er«Sar«e all paymems In Ooll^ra, U. S, currency m wl.lcU this* credit is isfeueO-J DATE #^^ jif. X»^t.JL^J .if;; ;[!^-^u ,'*: ^ - ! . t Amouni carried forward L ci -,|*4C^QI.^k^i> '-'^l^ii'ji'i'li'A'!^'' H-^4ru'i^_4t.ij' Ho. CO Traveler's Dollar Letter of Credit Reinihursenient through Dollar Drafts on New York [ FRONT ] Traveler's Dollar Letter of Credit Any amounts paid against this credit are endorsed on the Letter of Credit by the paying hank [ BACK ] [60] [61] f i ■ iiiiiiiiiei iiiiii iliiililiii iMiiiliiiiiiiiiiliiliiil (iti£l ^iarayw [tea [^ l ^] i^ / it :tfc:3 !• ■ IP ' pica wmoo Gircrdar Letter of €re«Iit •^/^rr<^'^^:r%^^^ [^ (^ ^] /■■; gf . € r ^j [^ ^ir. ^ Gnanmty Trust ^n^Hjmi^ •/iiYi>mi^n;:^. ^^^^ ■ J, (Pie«##, «;n4or«i© alt. jiayxiaent** Ip, P'ounda* f5t«*rUiis; ourre-ncy; in^^'liiclTi tlil© orenilt i« ieii3U«a.>, .fe^j ^-j i ll - I ' ' III ! I M III H I I II : . I ' ' V" '" ''■'-';-■ ;■' ■■■■■' i ■ ' ' ' ■ '■; ;■■ ■■ - ■ ' • "" 11 '■ ■'■ '■' ■ ' " "" ~~~~*~"'*F'^, fei^iMiteiiiiiiiiiiiiiliiiiiiiii^ii! ^iffiPis;i'Sjs '±!:'r!gf! i:7i~"~te ;^ iiiiliiiiiliiiiiiii Traveler's Sterling Letter of Credit Any amounts paid against this credit are endorsed on the Letter of Credit by the paying bank [ BACK ] f [ fi-'5 ] INTENTIONAL SECOND EXPOSURE i i ltfc£l:! |it5]| iiaiiiiiiiiEiiilii iagiB iliiiiiia«gitii!i iBiiiliiiii ii ' T ff " ', ^ m J f m Guaranty Trust Company of NewYoil: Circular luotier of Credit ./- m^ {^ Si HI [^ [^ (^ 1^ [^ ^1 ^1 [^ i"Z-3 -: T"j( : Guaranty Trust Company ol ' ! ' jiit y .! I ' i .1 i i - j^ " -rr: [>f=3ii [ifeSj ML //WHffL / //f /Af'i M/*y',- yrnrr '//r^///"- ^1 [^ [^ Si (^ (^ 1^ ^] ^1 1^ [^ y<^;- /. mi /^//M>€^4fif^l/f/JI//r /^^^^ . WE r/, ..(^/ ■^. IS! ■fas! pi' . '^w/r/y«».*. *v*.p/f -■>"•: ■v.'*-.*-*.r**. 'if^^i; [ilrjj| (J»l»«»»«# entlorKfe all imyi>aent»» m Fouiid* iSterllxiK ovirtertcy In svUIcn tills i.irti«lit t at ls^^^l»»a.^ . j[^ ]; fi~' V OATB • • SXKRI^INO AMOUNTS i STaRUINO SPKCiKICATION OF ALI, PAYMENTS MAPlg til^DHR THIS IjBnrtrE;^ pF CREDIT. ;i.*<:r3sWHKiN PAID j KAID BV IN WOROS AMOCNTS IN I^IOURIbS M^; b e ykout iZ Traveler's Sterling Letter of Oedit R(Min])iirscnient tlir()ni»li Sterling' Draft on our London Office [ FRONT ] Traveler's Sterling Letter of Credit Any amounts j)ai(l against this credit are endorsed on the Letter of Oedit l)y tlie paying bank [ BACK ] I iS l ii|||||iiBiiii^iiiK|||irr^^^^ Guaraii^TVust Goiiipsay of ¥ewT5^ m mi ^m- M: 0000 ;fSS litS] [tiS ■ {^ •«=} RSI ii^ v^/ y/Tvy/ 1^ *isa e^ ^1 y GtiarantyXroM Comp y>/ f*f/'/M 4U r4f r/'frf// D yy/rv/ /^r//^ //'///»>i' /f/^rrfv/z/y ///>//;/ /v/// /^ >/, f/W^r^^r, ^ ///,ji./f>//y.j, * J^S N^^A [^ lio ' r.-¥ '-m^t^mo^ /4^ ff>^t^j^'m/rw/j: <0 \^ Ml MAXutrii «»f «»-T»w''* Traveler's Letter of Credit in Francs Reimbursement by Franc Draft on our Paris OflSce [ FRONT ] [64] Siiiiiiiii'^ iiiiiiii ! N3! J DJ&TAILS DE TOUS LES PAIEIVIENTS EFFECTUtS EN VERTU DE CETTE LE'ITRE DE CREDIT. (VeuBlea iasnrini Jet (MoemenU «n Fnnea Cc8ot«is ». v. ji.) il»fc3n Due 4a P»y^ p»r Bi /^ a4>^t#ww^ MwituilB eo Fniocs fmntMl en tonm lcttre« 4H-^^^\/cd Montam* en Fraoc* frvi£&is en chiArnt %X \0 ^} ^1: r- i (t^t S! •^3 P ■ M\ ;& ■fr ! r^ (« rR-' IK- 1^' i«- ' ■ i' .ft' liiiiiiii^- 3iiiiiiSiiiiiiii r.-'.-, m Traveler's Letter of Credit in Francs Any amounts paid against this credit are endorsed on the Letter of Credit by the paying bank [ BACK ] [65] i Ii t % k INTENTIONAL SECOND EXPOSURE mi iiiiiiiiiliii-; (^ ^j ^} (^ ^ m^ 1*11 @s] ^^ssiiiiiiiiiiiiiiiiiiiii iiiiiiM >t3 1^ (@ ■ i Guaranty Trust Company of New York lettre 4c Ciiidtt ctacuiaire '^: 0000 .iQ^^<^^ iigil' i^fl 1^ ^/ '!^ ^m '^-' (^ (^ (^ ^ir r/rr f M^4t^:) /f^/r /t/vn /Wrrrz/'^yr t /i rr/'//f //// Guaranty Trust Gomp Succursalo. i:x (^ ^ ^' A/iff Af/ fyr^(.////^r/> r/w///fr ^ ,^^ffj(tr Ai j/fyf:j);^ / ajt/r/zw/z/v /A //fArf ff //.j/fAffrrA/'// /•A/jAf/f^v/zfr • 1 ^ c,vtC #i^ il*.Vt«Ati*:» «ii;<-«MrrA«r ^! *£3 1^! ^] (^ (^■^-'^ <^6ii^///i/^ /^^^ Traveler's Letter of Credit in Francs Reimbursement by Franc Draft on our Paris Office [ FRONT ] [64] DJ&TAILS DE TOrS LES PAIEMENTS EFFECTUfiS EN VERTU DE CETTE LEHKE DE CREDIT. (VcuiHe* ittscrire 1m {tcicmeBts en Franca fraot»i» s. v. j*,) '^"^* D*le da ff pMemrat H. i |w-:3?! &"^j ^7' 1 1 -t ] , '« i « } ►f i 1 p. t»*- 1 Pay* par RnOttittlllilALOeSGDIimEK Montiint* en Fr«no frMi{olr« letlreit Mnntants en fraor* bansaia «B ciufires lyQx/fiC 4^-^.Av^ la \00 I 'n-~';\ \ m < >. s; ! , \ i ! ''iii-:. •^.-i m ^if^il^f- i ifr^'- • 1 ill*']' • *' ; i '. '^■' J* : ' . ^ . ; M '.'i'~~ ■*-" L ::Lt it:.; i.*"' ■ ~ -■ ■- _,:_., Kiii Traveler's Letter of Credit in Francs Any amounts paid against this credit are endorsed on the Letter of Credit by the paying bank [ BACK ] [65] American Banks in Europe (Above) Pall Mali, London Office (Below) Paris Office I THROUGH our nine branches in Europe and more than two thousand corre- spondent banks in every trade center of the world, we are prepared to render com- plete international banking service that is accurate, prompt and safe. We have three branches in Ix)ndon, and one each in Paris, Brussels, Liverpool, Antwerp, Havre and Constantinople. All of these branches, being familiar with European conditions and business pro- cedure, and conducted along American lines, are in an especially favorable posi- tion to serve American business houses and travelers. Business relations can be established with these branches direct or through any of our New York offices. The range of their service is exceptionally broad. It embraces every banking function; the furnishing of trade and travel information; assistance in establishing connections; the collection of income and the care of securities abroad; and other services. We cordially invite you to avail yourself of our facilities. [66] International Trade Service The Guaranty Trust Company of New York maintains a highly developed International Trade Service for the purpose of closely following political, financial, and commercial conditions throughout the world. This service also acts as a medium to bring the American seller in touch with foreign buyers, and the American buyer with foreign sellers. Its files contain names of foreign and domestic business houses, classified according to their inter- national trade interests which are available to customers upon inquiry. The personnel of this Service is composed of men of long experience in research work and foreign trade promotion. Information is gathered from all available sources: Our branch offices and for- eign representatives, our correspondents, government bulletins, and the foreign and domestic press, and our files include also extensive information on foreign tariffs, customs regulations, trade and banking practices, methods of extending credit in all countries, commercial laws and transportation. A monthly summary of foreign and domestic trade and financial conditions is published in a bulletin, "The Guaranty Survey." Many special reports are prepared for clients, and information is freely given to those interested in the development of international trade. Foreign Credit Department The foreign Division of the Credit Department is prepared to advise importers, exporters, merchants, and bankers regarding moral and financial responsibility of their clients or prospective customers abroad. Through constant inquiry and file revision, this information is recent and reliable. This world-wide service is rendered without charge through the well-established facilities of our various branch offices, affiliated institutions, and correspondents. The services of our special foreign representatives are also available in this con- nection. Special investigations of particular firms are made upon request. II I r I f IP I [67] |: Business With Our Branches and Affiliations The Branches Department of the Foreign Department attend to the business of customers with our London, Liverpool, Paris, Le Havre, Brussels and Con- stantinople branches, and with our affiliations, the Mercantile Bank of the Americas, for Central and South America and Cuba, and the Asia Banking Corporation for the Far East. All transactions with these branches and affiliations, such as proposals of new business, opening of check and time deposit accounts, transferring of money, and forwarding of securities to our Branches for safe keeping, receive special attention in this department. Customers who contemplate doing business with foreign banks are invited to consult with the officers of this department, as they are thoroughly familiar with the practices and customs of foreign banking. Direct Foreign Banking Facilities Great Britain and Continental Europe The London, Paris and Brussels offices of the Guaranty Trust Company of New York are officially designated United States depositaries. They are American in- stitutions, conducted on American lines, and are especially well equipped to render banking service throughout Eiu*ope. Additional branches have been established in Liveri)ool, Le Havre, Antwerp, and Constantinople. We have our own special representatives in Australia and in the Scandinavian countries. The Mercantile Bank of the Americas, with which we are affiliated, maintains offices in Barcelona and Madrid, which are depositaries for the United States Government. Through this connection we ofiFer direct service with Spain and Portugal. This institution also maintains Branches in Paris and Hamburg. South and Central America, Cuba and the West Indies The Guaranty Trust Company of New York has direct connections with the leading financial institutions in Argentina, Uruguay, Chile and Brazil. We cover other coimtries of South and Central America, and the West Indies, through the Mercantile Bank of the Americas, which has branches and connections as follows: Argentina Banco Mercantil y Agricola de Bueuos Aires: Buenos Aires. Brazil Colombia American Mercantile Bank of Brazil: Para, Pernambuco. Banco Mercantil Americano de Colombia: Bogota, Barranquilla, Cartagena, Medellin, Manizales, Girardot, Cali, Honda, Armenia, Bucaramanga, Ciicuta. [68] CosTA Rica Cuba Honduras Nicaragua Peru Venezuela Banco Mercantil de Costa Rica: San Jos6. Banco Mercantil Americano de Cuba: Havana, Ciego de Avila. Agencies in Ecuador, El Salvador, Guatemala. Banco AUautida: La Ceiba, Tegucigalpa, San Pedro Sula, Puerto Cortez, Tela. National Bank of Nicaragua: Mangua, Bluefields, Leon, Granada. Banco Mercantil Americano del Peru: Lima, Arequipa, Chiclavo, Callao, Irujillo, Pmra. Banco Mercantil Americano de Caracas: Caracas, La Guayra, Puerto Cabello Maracaibo, Valencia. ' South Africa, Australia and New Zealand The direct connections of the Guaranty Trust Company of New York with the National Bank of South Africa, at Cape Town, and its many branches in the Transvaal, Rhodesia, Natal, Mozambique, etc., assure customers of efficient bank- mg service throughout the Union of South Africa. We have a special representative in Australia, and our direct banking connec- tions offer a comprehensive service for trade in Australia and New Zealand. The Mediterranean Owing to the increasing trade between the Levant and the United States, the Guaranty Trust Company of New York has opened a branch at Constantinople, to support American interests. We also have co-operative arrangements with the great English and French institutions established in these territories, which permit us to offer a complete banking service throughout the Levant. China, Japan, British India, Dutch East Indies, Straits Settlements, and the Far East Through its affiliations with the Asia Banking Corporation, The Guaranty Trust Company of New York negotiates direct banking transactions of every nature m China, Manchuria, Southeastern Siberia, and throughout the Far Ea^t Ihe Asia Bankmg Corporation has its main office at No. 35 Broadway, New York City, and has offices in Shanghai, Peking, Tientsin, Hankow, Canton,Hong Kong, Changsha, Singapore, and Manila, P. I. The Guaranty Trust Company of New York is also official correspondent for leading Japanese banks. We are representatives in the United States of the Tata Industrial Bank of india, and render direct banking and merchant service throughout British India. The Tata Industrial Bank was organized by English and native bankers to promote investment m industrial enterprises, many of which have been established since the war began. It is the first institution of the kind ever established in India and at present has oflSces at Bombay, Calcutta, and Hyderabad. Others are soon to be established. In addition to the above the Guaranty Trust Company of New York has a resident representative in India. We are also correspondents of the leading Dutch banks established in the Dutch East Indies and the Straits Settlements. [69] i> Currencies of Various Countries in the World and their Nominal Equivalent at Par in United States Dollars {All these rates are subject to exchange fluctuations) COUNTRY CURRENT COIN NOMINAL EQUIVALENT AT PAR IN U. 8. DOLLARS NORTH AMERICA Canada Gold Dollar $1. Mexico Peso 0.50 Newfoundland Gold Dollar 1.014 St. Pierre & Miquelon Same as France 0.193 * CENTRAL AMERICA British Honduras Gold Dollar $1. Costa Rica Colon 0.465 Nicaragua Gold Cordoba 1. Guatemala Paper Peso fluctuates in value Honduras (Spanish) Same as U. S. 1. Panama Gold Balboa 1. Silver Peso 0.50 Salvador Silver Peso 0.40 British West Indies Same as United Kingdom 4.8665 Cuba Same as United States 1. Danish West Indies Franc 0.193 Gold Dollar 1. Dominican Republic Same as United States 1. Dutch West Indies Same as The Netherlands . 40^2 French West Indies Same as France 0.193 Haiti Gold Gourde also United States Currency 0.186 Porto Rico Same as in the United States 1. Argentina SOUTH AMERICA Gold Peso $0 . 965 Paper Peso . 4246 Bolivia Boliviano 0.389 *Non — In many countriea gold coins do not actually exist, but are only theoretical units of exchange [70] Currencies of Various Countries in the World {All these rates are subject to exchange fluctuations) NOMINAL ] EQUIVALENT AT PAR COUNTRY CURRENT COIN IN SOUTH AMERICA Continued U. S. DOTJARS Brazil Gold Milreis Paper Milreis, fluctuates in value $0,546 British Guiana • Gold Dollar 1.00 Chile Gold Peso Paper Peso fluctuates in value 0.365 Colombia Gold Dollar 0.973 Dutch Guaina Same as The Netherlands 0.402 Ecuador Sucre 0.487 French Guiana Same as France . 193 Paraguay Paper Peso (fluctuates in value) Peru Libra Peruana (Gold) Soles (Silver) 4.8665 Uruguay Peso 1.034 Venezuela Bolivar EUROPE 0.193 Austria Belgium Crown Franc 0.193 Bulgaria Lev 0.193 Czechoslovakia Denmark Kronen Kronor 0.268 Finland France Finnish Mark Franc 0.193 Germany Mark 0.238 Greece Gold Drachma 0.193 Hungary Kronen 0.00 Iceland Same as Denmark 0.268 Italy Lira 0.193 Jugo-Slavia Dinars and Kronen (1 Dinar equals 4 Kronen) 0.00 Luxembourg Francs 193 171] Currencies of Various Countries in the World Currencies of Various Countries in the World f {All these rates are subject to exchange fltuiuaiicms) {All these rates are subject to exchange fluctuations) 1 COUNTRY CURRENT COIN NOMINAL EQUIVAT.ENT AT PAR IN U. 8. DOLLARS COUNTRY CURRENT COIN NOMINAL EQXnVALENT AT PAR IN U. S. DOLLARS EUROPE— Continued AFRICA Malta Netherlands Norway Poland Portugal Roumania Russia Spain Sweden Switzerland United Kingdom Turkey Same as United Kingdom Florin or Guilder Kronor Polish Marks Gold Milreis Lei Rouble Gold Peseta Kronor Franc Pound Sterling Gold Pound 4 . 8665 0.402 0.268 Abyssinia Algeria Belgian Kongo British South Africa British West Africa Egypt French Africa Italian Africa Liberia Madagascar Mauritius and Seychelles Maria Theresa Dollar or Menelik Dollar Same as France Same as Belgium Same as United Kingdom do Egyptian Pound Same as France Same as Italy Gold Dollar (U. S.) Same as France Rupee $0,425 0.193 1.08 0.193 0.515 0.193 0.268 0.193 4 . 8665 4.40 0.193 4.8665 4 . 8665 4.943 0.193 0.193 1.00 0.193 - ASIA Morocco Portuguese East Africa French, English & Spanish Same as Portugal money 1.08 British India Rupee Portuguese West Africa Same as Portugal 1.08 Ceylon Rupee -' Tripoli Same as in Turkey 4.40 China Tael (Shanghai) Tunis Same as France 0.193 (Fluctuates with the price of silver) | Zanzibar Rupee Hong Kong Local Dollars (fluctuates the price of silver) with 1 Dutch East Indies Same as The Netherlands 0.402 French Indo-China Silver Piaster (fluctuates with the price of silver) Japan Yen 0.498 • Persia Kran (fluctuates with the j of silver) 5rice Siam Gold Tical 0.3708 Siberia Rouble Straits Settlements Straits Dollar Australia & New Zealand Same as United Kingdom 4.8665 Philippine Islands Peso 0.50 Society Islands Franc [72] 0.193 m [73] il ';! -^ it An International Service in Assistance of Foreign Business Information on Guaranty service and its possibilities is available through our correspondents in the following cities: Outside of New York City ♦Albany 100 State Street Telephone: Main 6161 Atlanta 413-414 Atlanta National Bank Building Telephone: Main 693 ♦Baltimore 211-212 Keyser Building Telephone: St. Paul 3761-3764 ♦Boston 111 Devonshire Street Telephone: Fort HiU 6066, 6067 ♦Buffalo 201-202 Ellicott Square Building Telephone: Seneca 6400 ♦Chicago 105 South La Salle Street Telephone: Randolph 5290 ♦Cincinnati 2408 Union Central Building Telephone: Main 2500 ♦Cleveland 409 Guardian Building Telephones: Ontario 2480, Central 7480 Long Distance 393 ♦Detroit 201-205 Majestic Building .Telephone: Cadillac 4332, 4333 Erie, Pa. 306 Marine Bank Building Telephone: Erie 2611 Harrisburg, Pa. 200 Calder Building Telephone: Harrisburg 4624 Hartford, Conn. 911 Hartford- Aetna Building Telephone: Charter 8676, 8677 Jamestown, N. Y. 229-230 Wellman Building Telephone: Jamestown 1369 Johnstown, Pa. 207 Lutheran Building Telephones: Johnstown 840, Bell 540 9 Los Angeles 800 Citizens National Bank Building Telephone: 63648 Minneapolis 1128 McKnight Building Telephone: Atlantic 5027 *Philadelphia 421 Chestnut Street Telephones: Bell, Lombard 4691-4699 Keystone, Main 438 ♦Pittsburgh 607 Oliver Building Telephone: Grant 7367, 7368, 7369 Portland, Maine 608 FideUty Trust Building Telephone: Portland 6367 Providence, R. I. 623 Hospital Trust Building Telephone: Union 6997 Reading, Pa. 306 American Casualty Building Telephone: Reading 3422 ♦Rochester 349 Powers Building Telephones: Bell, Main 5749 Stone 5413 ♦^t Lottis xif o 406 Third National Bank Building Charles H. Newton San Francisco 907 Kohl Building Telephone: Dou^as 34 SCRANTON, Pa. 806 Brooks Building Telephone: Bell 770 Seattle, Wash. 511 Hoge Building Telephone Eliot 4257 ♦Toronto, Ont., Can. 14 Kind Street Washington, D. C. 811 Fifteenth St., N. W. Telephone: Main 5815 Wilkes-Barre, Pa. 604 Miners' Bank Building Telephones: Bell, 4390; Consolidated 859 ♦Asterisk indicates private wire connection with our Main Office in New York. [74J ♦Kansas Citt, Mo. Welch Walker 209 Commerce Trust Building t I 1 72.5.3 ^V^ ■n*^» FEB 2 3 ^933 /n rnsH (36t«7H NEH |^»0 »^ COLUMBIA UNIVERS 0044248180 TY LIBRARIES F£B2 m2 (4f Il^ i 'H;5i£^ :r-^ ns; END OF TITLE