LETTERS OF CREDIT are written papers authorizing credit to the amount named to the persons bearing them.

Such a letter is usually given by a banker, merchant, or other responsible man, to a distant banker or wealthy friend. The person bearing it may leave an equivalent with the party giving it, as a deposit of money, bonds, mortgages or stocks; or no security may be required, as in the case of a son or other near relative, or of a very intimate friend. It must have the written signature of the person sending it, and be guarded in other ways, as are drafts, checks, etc. A copy of the letter, with a description of the person named, is also sent to the correspondent addressed, by mail, in order to make the recognition of the person to be credited the more certain.

The person presenting the letter of credit, having been fully identified by the party to whom it is sent, must comply freely with any conditions stated in the letter before receiving the money.

If the money to be received on the letter of credit is to be used in paying a debt owing by the bearer of it to another party, the fact should be stated in the letter.

Should the letter not be accepted by the person to whom it is directed, the bearer of it should at once notify the writer of it, and state the ostensible reason for not honoring it.

A gentleman of means may obtain from another, in similar circumstances, a letter to a business house where the latter is well known and the former is not, reciting the financial ability of the applicant for credit, and guaranteeing the payment of any indebtedness incurred by him within a certain limit. The person of the strange gentleman must be so described in the letter that the business firm to whom it is addressed may readily recognize him as the person entitled to present it.

Or, if one gentleman has already incurred a debt, the letter of credit may guarantee the payment of the amount due within a specified time.

The gentleman who signs either letter is holden for the amount involved, provided the business house accepts the guarantee as soon as it is received.

Form Of Letter Of Credit

14 Soho Square, Beaver Street, London, Eng. , Dec. 4, 1882. Messrs. Drexel, Morgan & Co.,

New York City, U. S. A. Dear Sirs:

I take pleasure in introducing to you Mr. George W. Hopkins, of Belgrave Terrace, Newton street, London, C. W., who visits the United States for the purpose of investing in manufacturing property in the city or vicinity of Philadelphia, Pa., and desires to open a credit with you of Ten Thousand Dollars during each of the months of May, June and July, of 1883. I hereby authorize you to honor his drafts to an amount not exceeding in the aggregate the above-named sum, and charge the same to me. The signature of Mr. Hopkins accompanies this. Yours Very Respectfully,

MOSES BRANDENBERG. Signature of George W. Hopkins.

Mr. Brandenberg's Letter Sent by Mail.

14 Soho Square, Beaver Street, London, Eng., Dec. 4, 1882. Messrs. Drexel, Morgan & Co.,

New York City, U. S. A. Gentlemen:

We have to-day granted a letter of credit on your house (as per enclosed duplicate) to Mr. George W. Hopkins, for Thirty Thousand Dollars.

Mr. Hopkins is fifty-one years of age, six feet and one inch tall; has a dark complexion, with dark hair and eyes, and is slightly lame in his right foot.

Respectfully Yours,

MOSES BRANDENBERG.

A Guarantee Letter Of Credit

New Orleans, La., May 3, 1882. Mr. Robert Fleming,

St. Louis, Mo. Dear Sir:

Mr. Asahel T. Cox, the bearer of this letter, is an extensive dealer in hardware, stoves and tinners' stock, at Baton Rouge, La., who is now about visiting your city for the first time, with a view of purchasing large additions to his stock of merchandise. We have reason to know the condition of his financial ability, his character for fair dealing and his promptness in meeting his liabilities. We, therefore, do not hesitate to guarantee the payment of any indebtedness that he may contract with your house not exceeding Ten Thousand Dollars, on not less time than sixty days. Very Respectfully Yours,

GEORGE PROBITY & CO.,

104 Breadalbane Street.