THE CUBA REVIEW 



Havana Correspondence 



Havana, May 30, 1922. 



Sugar: As predicted in our last monthly news letter, a large number of mills have 

 brought their grinding season to a close much earlier than customary, owing to the 

 extreme length of the dry season, which was immediately followed by an extremely 

 heavy rainy period which still continues. 



Last season at this time there were 165 mills still grinding as compared with 85 

 at the present time. The past few days have been inactive and sales small. The 

 expected advance in price has not as yet taken place although the market shows signs 

 of increasing firmness, and while those who predicted 5 cent sugar before the end of 

 1922 are probably doomed to disappointment, present indications are that there will 

 be a continued healthy increase in sugar sales right along, continuing into the xiext 

 grinding season. 



Continued heavy rainfalls during the past several days have been an adverse factor 

 in sugar production and have caused many mills to cease operations temporarily, while 

 others, due to the lateness of the season, have decided to suspend grinding until next 

 year. 



It is reported that Central Limones, which was one of the Lezama group of 

 Centrals during his regime of high finance, will be turned over on June 30th to the 

 National Bank of Cuba to satisfy the mortgage, said amount to $600,000, held by 

 that institution. 



It is not known as yet what disposition will be made of the numerous sugar mills 

 held by the banking institutions, but it is believed that as soon as practicable, arrange- 

 ments will be made to turn them back to the original owners, or sugar interests, for 

 operation, as it is generally understood that the banks are not interested in the 

 operation of these mills any longer than is required to complete financial arrangements 

 necessary to have them relieved of their operation and control. 



Financial Conditions: Failure of H. Upmann & Company, considered to be 

 among the strongest of the private banking institutions of the country, to open their 

 doors on Tuesday May 2d, following the May Day holiday, caused a general surprise 

 and a slight run to the other banking institutions, which, however, was soon checked. 



Later investigations into the cause for the Upmann failure caused the authorities 

 to issue warrants against the Upmann brothers on charges of fraud. At present the 

 senior member of the firm is being held under $100,000 bail pending a thorough inves- 

 tigation in the dealings of the bank. 



This failure came at a most inopportune time and was extremely unfortunate, 

 inasmuch as the country was just emerging from the severe financial depression which 

 it has undergone since the latter part of 1920. It may be said, however, that the 

 Upmann failure did not cause as much of a setback as was at first anticipated and. 

 contrary to the usual happenings in the past when a banking institution failed, there 

 was not a widespread withdrawal of funds from the other banks. The bank is in the 

 hands of the liquidation committee and pending their report it is impossible to estimate 

 just how bad the failure may be. 



One of the most promising signs of the financial situation is the general indication 

 that the people have a feeling of confidence in the remaining banking institutions, and 

 also that this latest failure marks the end of weak or criminally negligent banking 

 institutions doing business in Cuba. 



Such failures, which have been entirely too frequent in Cuba, obviously prove the 

 necessity for stronger banking laws than those now existent, especially in so far as the 

 operation of private banking institutions is concerned; otherwise, periodic failures and 

 small panics may be expected to occur from time to time until some curb is placed 

 upon the activities of unscrupulous bankers and those inclined to indulge in speculation 

 with other people's money. 



The liquidation committee is still working on the books of the several defunct 



