China Historic Bonds

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1904 SNR Sub-Cert

1904 SNR Sub-Cert Image

1904 Shanghai-Nanking RailwayNet Profit Sub-Certificate

As one of the main investors, the British & Chinese Corporation was entitled to 20% of the net profit from the operation of the Shanghai-Nanking Railway and the corporation ceded that right to the subscribers of the 1904 Shanghai-Nanking Railway Bonds.

The capital for the 1904 Shanghai-Nanking Railway Loan was £3,250,000, but the original issue of bonds in 1904 was only for 22,500 bonds each of denomination £100. Subsequently a further 6,500 bonds were issued in 1907. The final batch of 3,500 bonds as per Kuhlmann reference 117, were never issued.

It was originally planned to issue Shanghai-Nanking Railway Net Profit Certificates (Kuhlmann Reference: 118), whereby one such certificate would be issued for every 5 Shanghai-Nanking Railway bonds of £100 held by investors. Therefore the planned issue of Net Profit Certificates was 5,800.

It now appears that these Net Profit Certificates were never issued and were superceded by the issue of Shanghai-Nanking Railway Net Profit Sub-Certificates (Kuhlmann Reference: 119) whereby there were to be five Net Profit Sub-Certificates issued for each of the original Net Profit Certificates. In effect there was one Net Profit Sub-Certificate for every bond issued under the Shanghai-Nanking Railway Loan.

It is evident that the planned issue of the Net Profit Sub-Certificates was to cover the total capital sum of £3,250,000 as there was provision detailed on the Net Profit Sub-Certificates for the issue of 32,500 such certificates. However, since only £2,900,000 was floated, there were only ever 29,000 Net Profit Sub-Certificates issued.

Since the original plan was to issue 5 Net Profit Sub-Certificates to replace each Net Profit Certificate, the Sub-Certificates were issued in batches of 5 whereby the serial number would correspond to the original Net Profit Certificate. This gave rise to each batch of five Net Profit Sub-Certificates having a prefix A-E, but with the same serial number.

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