THE NATIONAL, MORTGAGE BANK 45 



Increase of capital. 



In May, 1913, the Board of Directors of the Bank, seeing that the is- 

 sue of bonds had reached the maximum limit authorized for circulation 

 (500,000,000 pesos), presented a note to the Department of Finance peti- 

 tioning for a reform of the organic law, so that the capital might be raised 

 to 1,000,000,000 pesos. 



This increase was considered advisable on the ground, among others, 

 of the necessity of not arresting the action of the Bank which is one of the 

 principal agents in the industrial and agricultural progress of the country. 

 The sale of the farms and the subdivision of landed property etc., adds the 

 note, are considerably assisted by this institution. Now, as we have shown, 

 the 500,000,000 pesos, forming the capital of the Bank, do not represent even 

 the third part of the total debt on the land, as the rest is due to loans of 

 private, to a large extent of foreign, capital. If it is borne in mind that 

 the interest on private loans is higher than that asked by the Bank, it 

 will be easily understood how heaw a loss the country suffers in this way 

 and what an obstacle to the development of mortgage credit there is in the 

 limitation of the resources of the Bank. To those objecting that a new issue 

 might shake confidence in the Argentine bonds on the market, its advocates 

 replied that the credit of these securities would not suffer in the least, if 

 the circulation were gradually increased and due precautions taken. 



The Financial Commission, approving the proposal of the Bank 

 in its essentials, laid before the Chamber of Deputies a bill for the increase 

 of the capital not by 500,000,000 but by 120,000,000. 



After a long and animated debate, the Chamber decided last Septem- 

 ber to authorize the Bank to increase its capital by 250,000,000, thus 

 raising the maximum limit of circulation to 750,000,000 pesos. The new 

 issues will be made in series of not more than 50,000,000 pesos. 



(Su nmarised from the " Report on the Work of Ike Naiii-nal Morigaqe Bank' 

 for the Year 1912 " an"; the Nacion, May-Sept(.mbcr, 1913) 



