THE CUBA Bee VE We 9 
compelled to accept practically any price for their product since the need for funds is 
so very great at the present time, but the best interests of the Island are, we believe, 
undoubtedly being served in the maintenance of prices by this commission. The 
restoration of the prosperity of the Island rests with this organization, we believe, and 
the element of market manipulation of this product has also been eliminated for the 
crop of 1920-1921. 
FINANCIAL Srruation: During the month of April much has happened to disturb 
the financial equilibrium, which it was deemed was about to be reached in Cuba. The 
appointment of Sr. Porfirio Franca to the presidency of the Banco Nacional de Cuba 
was considered as having stabilized that institution, which had gone through so much 
during the past six months. 
The Island was astounded on April 9th to learn that the Banco Nacional had, after 
experiencing a run of two or three days, closed its doors. The directors concluded that 
the only step which could be legally taken was to liquidate the bank’s assets and start 
anew witha clean slate. Much unfortunate publicity was directed at the Banco Nacional 
de Cuba in the Cuban press of the Island and this propaganda seems to have had its 
effect in causing a large number of the depositors in this institution to withdraw their 
funds, thereby weakening the position of the bank. When it was ascertained that the 
obligations falling due under the Torriente Law could not be met, liquidation was the 
only means which could be resorted to. These pernicious attacks by the Cuban press 
continued against the American banking institutions established in Cuba for so many 
years, and the Royal Bank of Canada found it necessary to appeal to the British Minister 
to take the matter up through diplomatic channels with the Cuban government, with 
a view to having the Cuban press show legal cause for these pernicious attacks or cease 
their efforts to discredit banking institutions which could show themselves solvent and 
the best of friends to Cuban business. 
The demoralizing effect of unwarranted propaganda of this nature can readily be 
seen since, if the public is convinced that the banking institutions are not solvent, the 
immediate withdrawal of many thousands of small accounts would naturally render the 
banks unable to extend credits to legitimate industries badly in need of funds. The sugar 
interests of the Island at the present time have never been in more urgent need of ready 
cash and if one will consider that the banking interests found it necessary to curtail 
legitimate loans to active sugar interests of the Island, the effect can easily be imagined. 
Much credit is due the American daily newspaper ‘““‘The Havana Post” for having 
given publicity to the damaging propaganda which was being spread throughout the 
Island by the Cuban Press. The ‘‘Havana Post” published broadcast statements from 
the directors of the Royal Bank of Canada and other American financial institutions 
in Cuba, to the effect that the banks were absolutely solvent and the only result of this 
pernicious propaganda would be in the tightening of credit and creating of hardships on 
legitimate business in Cuba. This airing of unwarranted propaganda which had been 
instituted against these foreign banks has stabilized conditions again and these institu- 
tions have even gone so far in the way of demonstrating their goodwill towards the Island 
as to bring down large sums of money (estimated at twenty million dollars) which are to 
be loaned to the sugar centrals needing the money and also to other legitimate business 
interests in Cuba. 
It is understood that the Banco Espanol de la Isla de Cuba (The Spanish Bank of 
Cuba) has about completed its arrangements for its reorganization with a capital of 
$40,000,000.00 instead of $8,000,000.00 and that Spanish and American interests are to 
take over the institution, under new management, and under the name of Banco Espanol 
de las Americas. This institution was caught in the great slump in the price of sugar 
with large quantities of sugars on hand and it was felt, and in fact is still felt, that if the 
present arrangements for the introduction of new capital do not materialize the bank 
will be forced to follow the action of the Banco Nacional and liquidate. 
Srrikes: During the month the shipping interests in the bay of Havana reduced 
the wage scale for the skilled and unskilled labor employed at the different marine 
