The full text on this page is automatically extracted from the file linked above and may contain errors and inconsistencies.
EXPANSION I N COMMERCIAL BANK LOANS, 19^6 AND 19^7 D u r i n g 19^6 and t h e f i r s t 10 months o f 19*1-7, l o a n s a t commercial banks expanded about 10 b i l l i o n d o l l a r s . T h i s e x p a n s i o n r e f l e c t e d an i n c r e a s e i n l o a n s t o b u s i n e s s e s , consumers, r e a l e s t a t e owners, and f a r m e r s o f over b i l l i o n d o l l a r s , w h i c h was o f f s e t i n p a r t b y a d e c l i n e i n l o a n s on s e c u r i t i e s o f o v e r If- b i l l i o n s . Growth i n l o a n s has been p a r t i c u l a r l y r a p i d i n r e c e n t months. I n t h e f o u r month p e r i o d June-October 19^7 > l o a n s i n c r e a s e d o v e r 3 b i l l i o n d o l l a r s , r e f l e c t i n g p r i m a r i l y e x t e n s i o n o f bank c r e d i t t o b u s i n e s s e s , b u t a l s o f u r t h e r s u s t a i n e d g r o w t h i n l o a n s t o consumers and r e a l e s t a t e owners. B u s i n e s s l o a n s . — B u s i n e s s demand f o r bank c r e d i t r e v i v e d on a b r o a d s c a l e i n mid-19^5 and has c o n t i n u e d s t r o n g i n 19^-6 and 19^*7• Since June t h e demand f o r b u s i n e s s l o a n s has i n t e n s i f i e d , and such l o a n s have i n c r e a s e d o v e r 2#5 b i l l i o n d o l l a r s o v e r t h i s p e r i o d . Consumer l o a n s . - - B a n k l o a n s t o consumers have shown s u s t a i n e d i n c r e a s e s i n c e t h e end o f t h e w a r , and a t t h e end o f October were more t h a n t w i c e as l a r g e as a t t h e end o f 19^5 • Consumers a r e c u r r e n t l y increasing t h e i r d e b t t o banks a t t h e r a t e o f about 100 m i l l i o n d o l l a r s a month. * R e a l e s t a t e l o a n s . — B a n k c r e d i t t o owners o f r e a l e s t a t e expanded more t h a n k b i l l i o n d o l l a r s i n 19^6 and t h e f i r s t 10 months o f 19^7. This g r o w t h r e f l e c t s b o t h t h e l a r g e volume o f mortgages on t h e market and t h e i n c r e a s e i n t h e p r o p o r t i o n o f mortgages p l a c e d i n commercial b a n k s . Loans on s e c u r i t i e s * — I n 19^6 l o a n s f o r p u r c h a s i n g and c a r r y i n g s e c u r i t i e s d e c l i n e d almost k b i l l i o n d o l l a r s , r e f l e c t i n g l a r g e l y liquidation o f bank c r e d i t extended i n c o n n e c t i o n w i t h purchase o f Government s e c u r i t i e s - 2 - I n t h e V i c t o r y Loan D r i v e * Some r e d u c t i o n i n l o a n s f o r p u r c h a s i n g and carrying other s e c u r i t i e s also occurred. Decline i n these loans in I9IJ-6 o f f s e t i n p a r t t h e g r o w t h i n o t h e r "bank l o a n s and dampened somewhat t o t a l l o a n expansion. I n 19^7 r e d u c t i o n s i n l o a n s on s e c u r i t i e s have amounted t o about o n e - h a l f b i l l i o n d o l l a r s — n o t a l a r g e enough d e c l i n e t o h o l d down s i g n i f i c a n t l y t o t a l l o a n expansion. T a b l e s showing, f o r a l l i n s u r e d commercial banks and f o r banks i n l e a d i n g c i t i e s , t h e changes i n l o a n s , b y k i n d s , a r e a t t a c h e d . Loans a t A l l I n s u r e d Commercial Banks, b y K i n d ( I n b i l l i o n s of d o l l a r s ) Kind of loan All loans Commercial, industrial, and a g r i cultural 1 9 3 9 , Jane 16.0 6.9 1*.0 1910, Dec* 25.8 10.8 lu7 2.U 6.8 1.2 19U6, June 26.8 11.7 5.7 3.1 5.1 1.2 Dec* 30.7 I5.lt 7.1 lwl 3.1 1.1 33.3 16.3 8.2 U.9 2.8 1.0 36 *U 18.8 8.8 5.2 2.5 1.1 Bate 191*7, June Real estate Loans on Consumer s e c u r i ties e 2.U 1.6 All other e 1.1 e O c t . 29 e - Estimated* Mote*-—Excludes l o a n s a t n o n i n s u r e d commercial banks w h i c h comprise about one p e r c e n t o f t h e l o a n s a t a l l commercial banks* Loans a t Member Banks i n Leading C i t i e s ( i n b i l l i o n s of d o l l a r s ) . All loans Date Eind Commercial, industrial, and a g r i cultural Real estate l/ of lean Other— Loans largely on consumer s e c u r i t i e s Loans t o banks 19.1+ 11.3 2.5 2.8 2.7 .1 19.6 I 11.6 2.6 2.8 2.1* .2 February 26 19.8 11.8 2.6 2.8 2.3 .2 March 26 19.9 12.2 2.7 2.9 1.9 .2 A p r i } 30 19.9 12.0 2.8 2.9 1.9 .2 May 28 20,0 11.8 2.9 3-0 2.2 .2 June 26 20.2 11.8 3.0 3.1 2.3 .2 J u l y 30 20.5 12.0 3.1 3.1 2.1 .2 August 27 21.1 12.1+ 3.2 3.2 2.2 .2 September 2I+ 21.6 12.9 3.2 3.2 1.9 •3 October 29 22.6 13.8 3.3 3.3 1.9 .2 November 26 23.1 14.3 3.k 3.k 1.9 .2 19Deoember 31 191+7, January 29 l / Includes ijijl member banks i n 94 leading c i t i e s * Low P r i c e s o f L i b e r t y Bonds and V i c t o r y Notes F o l l o w i n g W o r l d War I Issue t 1 » Date o f Loir Bid Price t t » Bid t t Ask 1 s t Mean * * * Yield at Mean X (Percent) 1932-1947 1932-1947 1932-1947 1932-1947 1927-1942 1927-1942 1928 1933-1938 1922-1923 1922-1923 3-1/2J6 1 s t L i b e r t y . . . 4* 4-1/4* 4-1/4$ 456 4-1/456 4-1/4* 3rd L i b e r t y . 4-1/4* 4th Liberty 4-3/4* 3-3/4* O f f i c e of the Secretary of the Treasury O f f i c e of the Technical S t a f f Note: 1921 1920 1920 1920 1920 1920 1920 1920 1920 1920 86.30 83.00 84.00 91.00 81.70 82.00 86.00 82.54 94.82 94.72 86.34 83.50 85.00 94.50 81.90 82.10 86.10 83.00 94.86 94.80 4.39 5.16 5.34 4.73 5.41 5.67 6.58 5.78 6.68 5.67 November 2 0 , 1947 U n i t e d S t a t e s Government s e c u r i t i e s were quoted i n d e c i m a l s r a t h e r t h a n i n t h i r t y - s e c o n d s t h e p e r i o d i m m e d i a t e l y f o l l o w i n g W o r l d War I # 86.32 83.25 84.50 92.75 81.80 82.05 86.05 82.77 94.84 94.76 in
@FedFRASER