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180 BOARD OF G O V E R N O R S ****** OF THE FEDERAL RESERVE SYSTEM WASHINGTON R-915 A D D R E S S OFFICIAL C O R R E S P O N D E N C E TO THE BOARD October 31, 1941 Dear Sir: A form of registration statement for purposes of Regulation W (Form F.R. 563) has been approved by the Board, and several mimeographed copies are enclosed herewith, The form is now being printed here on single sheets, 8-1/2fcy11 inches, with the instructions on the reverse side. Please notify the Board as to the number of printed copies that you will require. The distribution of these forms will be, in general, in the hands of the Federal Reserve Banks and will be effected try such means as they may determine. It is assumed that ordinarily two copies of Form F.R. 5&3 will be needed by each prospective Registrant, one to be returned to the Reserve Bank of the district in which his head office is located and the other to be retained by him. The facilities of trade associations, chambers of commerce, and local banks may be used in distributing these forms to whatever extent you consider desirable. The Board has agreed, however, to supply forms to the Federal Home Loan Bank Board for distribution to all building and loan associations, to the Farm Credit Administration for distribution to all Federal credit unions, and to the Credit Union National Association for distribution to all State-chartered credit unions. Building and loan associations and credit unions, therefore, will not as a rule have to obtain their forms or notices from the Reserve Banks. There are enclosed a suggested form of notice to accompany the forms distributed ty the Federal Reserve Banks, and a form of "Registration Certificate" to be used by the Reserve Banks in acknowledging the completed statements received. It is requested that each Reserve Bank determine for itself whether to use the suggested form of notice, either as it stands or with modifications, but that all Reserve Banks use a "Registration Certificate" in the form enclosed. Each Reserve Bank will in any ovent arrange for its own printing. R-915 —2— Your attention is invited to the fact that Form F.R. 563 includes a note suggesting that Registrants with questions or difficulties should direct their problems to the Reserve Banks. In order to assure a uniform treatment of these problems and in order to deal with many minor points that were suggested at the time the first draft of the registration statement was circulated, some additional notes for the use of the Reserve Banks (but not for distribution to the Registrants) have been prepared, and several copie are enclosed herewith. The Board's staff is working on plans for the tabulation of the information that will be brought in on these registration statements, and there will be further communications in due course on this subject. Very truly yours, L. P. Bethea, Assistant Secretary. Enclosures TO THE PRESIDENTS OF ALL FEDERAL RESERVE BANKS R-915-a For* F.R. 563 , This statement la to be filed with the Federal deserve lank of the district in Please leave which the maim office of the Registrant is located, and should be sent to reach the Federal Reserve Bank on or before December 31, I94t, Before answering the questions. , please read the instructions on the back of this form. If you have any question about this form which i* not covered by the Instructions on the beck, please communicate jrlth the Reserve Bank* this space blank REGISTRATION STATEMENT Date 1941 This statement is filed in accordance with the provisions of Regulation 1 issued by the Board of Governors of the Federal Reserve System pursuant to Executive Order No# 8843 issued by the President of the United States relating to consumer credit. Name of Registrant (print or type); state also trade name If different from legal na Street Address City County State le Indicate by check mark whether Registrant is in business as an individual^ corporation . or other form (specify) " • 6*ner«t nature of business 1,1 * Credit outstanding and sales (Check the principal business of Registrant) J&* Financial business I* Sales finance company 2* Commercial bank or trust company (Whether or not subject to 1941 I* Retail Instaiment paper purchased, 2* Retail Instalment credit/ixlenwd 6* Other financial business (specify) d i rect I y a#*.*####*###### #.»**# 3* Personal instalment cash loans.....# 8# Registrants In classes 7 to 16 please report the 7. Department or goners) store following data: 8* Automobile dealer 9* Furniture or house furntsMngs store „ 40 e Household appliance or radio store H * Electric or gas utility company j-j omittedf where amount paper held at elose of business September 3 0 , 5 * Credit union A a (in even dot lira, cents Regulation W) is none, write *nene%) A* Registrants in classes I to 6 please report the unpaid balance of retail and personsI instalment 3* Industrial loan company or bank H, State**licensed small loan company * Dealer, contractor, or other business partnership^ 12 1 Retail sales. months ending September Total net sa es * * * * * * ^ * 4 30. 194Is j 5* The sales reported in item 4 were approximately* 12* Hardware or automotive eooessory store (a) instalment sales (inet* 13* Dealer or contractor in heating, plumbing or air-conditioning equipment down-pay men t s) .. . • • •**_ -- jG, (b) other credit sales.,*.* tc) cash sales.**.*.. 14** Dealer or contractor in other cons true* tion or repair materials 15* Manufacturer (specify type of product) Retail receivables, unpaid balance it close of business September 30, I94ls 1 6 * Other (specify). 6* Instalment receivables. % 7* Other reoe i veb I es*# * * . *.#**#***.* * TV* Did Registrant have any branches on September 30, 194l?w If so, how manytw (Please attach a list of brenohe^ and their addresses, unless the Registrant is a bank insured by F*t>fl*C*) V# Is 50$ or more of Registrants voting stock owned «r controlled directly or Indirectly by any othwr company? If so, please fill ins Name of controlling company City State Street Address nature of business of control Iing company VI* Exp 1 ana ties*, if sny, irfi tcb Re glsrtrsnt may wi sh to addie This h to certify that to the best of my kno*i##&^ and belief the foregoing statement is correct (except as to any H:#meiseHe#d ?sst^ which are estimated in good faith)* Plesse print or type here the name and official title of the person whose signature appears at the right Authorized Signaturo (Numbered to correspond with questions on Registration Statement) 183 EEBiUSSMSXiSl* JMM*~~ Instalment credit should iwluds credit for which the agreed repayment is In two or more parts* Instalment sales should Include sales made on Instalment credit* In case the records of the Registrant are kept on such a baa Is that receivables he Id on September 30, 1941, and sales fer the 12 months snding on that date art not readily available, the Registrant may In* stead report the amount of receivables held on a m y pther ds$e withM IS dave before or after September 30, and sales for the year ending on such other date in which case the date used should be stated. Businesses which were not in operation on September 30, 1941, pleass answer question III for such later date as IS convenient, clearly indicating the date used* A business concern organised to succeed another concern doing similar business should report for the concern succeeded, If possible* jj/*~-#rsnchee should include storss or offices at which the Registrant is engsged in making instalment » sales or otherwime extending instalment credit, or purchasing or discounting or making loans on Instalment obligations, Vl^l—This statement may be signed by any official ordinarily authorized to sign statements for the Registrant, SPECIAL INSTRUCTIONS FOR FINANCIAL BUSINESSES; (Sales finance company, bank, lean company, credit union, or other financial business)* HJ*A*~~Any hypothecated payments or deposits which are for the purpose of retiring loans should be deducted before reporting the unpaid balances of such loans* In case a Registrant cannot readily secure an exact division of Its outstandings between items 11 l*A~l, 2 and 3, the division may be estimated* III.A.I and a.Wmclude the unpaid balances of all frrimffiyt credits ^rlsin^ from the retail eale of and secured by art I c lee, whether or not listed iq fogul*t|on ;|U #uch as automobiles, trucks, household appliances, furniture, clothing, jewelry, etc,, including else loans fgr building repair or ^modernization (whether or not insured under FHA Title I and whether or net secured)* Any retail instilment paper purchased from or rsdiscoated far dealers or other? should be reported in item Ul*A-l snd loans made directly to eojimmsfo for the purchase of snd secured by such articles should be reported in 11 l - M * fto ftot Include loana mads to dealers and finance companies on their own promiesory notes, even if secured by the pledge of instalment paper* IIl*A-3.—Report the unpaid balances of all secured and unsecured instalment loans which were msde to in* dividuaIs, including those used for such purposes as consolidation #f debts, medical attention, general personal expend! twos, etc* (but do not Include any loans reported in Item 11 UA-2, nor loans to business concerns for business purposes, nor loans secured by mortgages or oiher Hens on real estate, nor agricultural loans)* SPECIAL INSfRUCTIONS FOR DEALERS« 00*T*AmR&. AND OTHERS, 11l*B*4.^Give net retail sales figurs (gross sales isss returns and discounts), but do not deduct trade* ins, A store thou Id include sales of leased depsrtsmmta for whieh It arranges and ho I da retail credit* A Registrant which is engaged in manufacturing or ether,busineas should report only the sales which It makes at retail* A Registrant who is a contractor should include receipts from repair work and the like. There shotltd be excluded from item I h o w e v e r , sales of clsotffcitv or gas by s Registrant who is s utility company and sales of real Qfftatp (and receivables arising from such sales should also be excluded from Items I ll#8#6 and 7), A concern ich was In businesa on September 30 but was not in operation throughout the 12 montha ending on that date, should report sales for only that part of the period for which it operated, indicating clearly thm length of such period* I I I I n s t s l m e m t sales* should include all saiss on instalment credit, regardless of whether the piper is sold or discounted or held by the Registrant, and should Include the down psyment (whether eesh or trade-in) as we 11 as the amount deferred* "Other credit sale,;* should include those on open credit, charge account, or similar basis* 11l-B-6 and %.**RetaiI receivables should represent the unpaid balances of all receivables, whether re* presented by notes, book accounts, or otherwise, arising from fo^il salfs fry foe Registrant* including ssles of automobiles, trucks, household appI lances, furniture, clothing, jewelry, building repair and modernization (whether or not insured under FHA Title l), etc. Retail receivables should include such credits even If pledaed as security foe loans to the Registrant, but shoul| not Include credits sold to (or discounted with) a bank or finance or other company with or without recourse* In case s Registrant, In sddltlon to holding receivables arising out of its own retail safes (reportable against items 1I t-B-6 and 7), also hold# receivables yHch were purchase^ or which arose from Iepdinpfc>vthm Rcfistrant. the receivables of the latter ty|es should be reported against ths appropriate items in group 111-A, (Some Registrants <*- such as some manufacturers or public uti W t y companies — may have no retail sales or retail credit to report under group |M-B but should report their purchased paper or looms under group 111-A*) " In case ths Registrant is unable to determine exactly, without undue inconvenience or expense* the division of its receivables between instalment and other credit, this division may be estimated* H ! § t -^Section 3(d) of Regu I at I en 1 provides in part as followst "The license of any Registrant may, after reasonable notice and opportunity for hearing, be suspended by the Board, either in its entirety or as to particular activities or particular offices or for specified periods, on any of the following grounds* (1) Any material misstatement or omission willfully or negligently made in the registration statement; (2) Any willful or negligent failure to comply with any proviaion of this regulation or any requirement of the Board pursuant thereto*" R-915-b y • Federal Reserve Bank of NOTICE REGARDING REGISTRATION IN CONNECTION WITH REGULATION W ON CONSUMER CREDIT Under authority of Executive Order No. 8843 issued by the President of the United States, dated August 9, 1941, the Board of Governors of the Federal Reserve System on August 21 issued Regulation W dealing with Consumer Credit. Section 3 of this regulation provides that all those who are subject to the regulation are required to be licensed; all such persons and organizations are automatically given a license which continues until December 31; 1941> but in order to have a license after December 31, 1941, it is necessary, on or before that date, to file a registration statement on the required form. This notice is to describe who must register and how registration is to be accomplished. Two copies of £he required form are attached to this notice. Who Must Register A Registration Statement should be filed by any person or organization which is: (1) engaged in the business of making instalment sales of any of the articles listed in the Supplement to Regulation W (which list is printed on the back of this notice), or (2) engaged in the business of making instalment loans in amounts of $1,500 or less, or instalment loans in any amount secured by articles listed in the Supplement, or (3) engaged ip the business of discounting or purchasing (or lending on the security of) instalment obligations arising from transactions described in (1) or (2). How to Register Registration is accomplished by filling out Form F.R. 563 and filing it with the Federal Reserve Bank (main office or branch) of the district in which the Registrant's main office is located. A map of the United States, showing the locations of the Federal 184 -2- R-915-b Reserve Banks and branches, is printed on the reverse side of this notice. Only one copy of the Registration Statement need be filed the second copy is provided for the files of the Registrant. Addi tional copies of Form F.R. 563 may be secured from any Federal Reserve Bank or branch. Only one Registration Statement is required for any one person or corporation, which will cover the main office and all branches, but each subsidiary, if it is a separate corporate entity and is engaged in the business outlined above, is required to file a separate Registration Statement. Instructions for filling in Form F.R. 563 are given on the back of the form, and these are intended to enable the Registrant to fill in the form quite readily. If in completing the statement, however, any Registrant has questions which are not answered by these instructions, or finds that following the instructions exactly would cause undue expense or inconvenience, the Registrant should take up such questions v.dth the Federal Reserve Bank. The foregoing notice applies only to persons who are in business and are required to register on or before December 31, 1941. For persons who begin business after that date and who will be required to register, an appropriate form and instructions will be obtainable from the Federal Reserve Bank at that time. R-915-c REGISTRATION CERTIFICATE . This is to certify that (Name) of 1 1 (Place) has filed a registration statement pursuant to Regulation W relating to consumer credit, issued by the Board of Governors of the Federal Reserve System pursuant to Executive Order No. 3843 of August 9, 1941, and is licensed under said regulation.* FEDERAL RESERVE BANK! OF By Authorized Signature * Under section 3(d) of Regulation W, any license may, after reasonable notice and opportunity for hearing, be suspended by the Board of Governors of the Federal Reserve System for: (1) Any material misstatement or omission willfully or negligently made in the registration statement; or (2) Any willful or negligent failure to comply with any provision of Regulation W or any requirement of the Board pursuant thereto. ADDITIONAL NOTES REGARDING THE FILLING OUT OF FORM F.R. 563, REGISTRATION STATEMENT UNDER REGULATION W. • e R-915-d 187 In addition to the instractions which are printed on the back of Foim F.R. 563, the registration statement prescribed under Regulation W, a number of questions have arisen which may be brought up by Registrants but which are not deemed to be of such general application as to call for answers in the instructions. The following notes are intended to assist the Reserve Banks in answering such questions when they are brought up, and to increase the uniformity of reporting by the Registrants in different districts. Determining the general nature of Registrant's business. - „ In answering question II it is intended that the Registrant should check (or write in against items 6 or 16) the usual designation by which the establishment is known to the trade or public. Where there is doubt on this point and the Reserve Bank is asked to assist the Registrant in deciding, it may be desirable for the Reserve Bank to consult the designations used in the Census of Business for 1939, which are available in several publications that are likely to be in the library of each Reserve Bank. Where a Registrant's business consists of several parts which would fall into several classifications, the general rule in determining the answer is that the Registrant should check (or write in) the designation applying to that part of the business which produced the largest amount of sales or gross revenue. * Industrial banks, even though insured by the Federal Deposit Insurance Corporation (including those that are State members or have national bank charters), should check item II-A-3 rather than II-A-2. . Reporting of approximate or inexact figures.- * . • While it is desired that the answer to question III be sufficiently accurate to provide useful statistical data on total instalment outstandings and credit sales, and that each registration statement provide a reasonably accurate indication of the amount of the Registrant's instalment business, it is not desired that any Registrant should be put to any undue inconvenience or expense in order to provide exact figures on this form. As indicated in the instructions which are printed on the back of Form F.R. 563, a Registrant who finds it inconvenient to report as of September 30 will be permitted to report as of some nearby date; a Registrant who is unable to secure readily an exact division between items III-A-1, 2 and 3 will be permitted to estimate this division; Registrants may give approximate figures against item III-B-5; and the division between outstanding instalment receivables (item III-B-6) and other receivables (item III-B-7) may be estimated. In addition, however, there are some other points on which it appears that exact reporting would unduly inconvenience a few Registrants and on which estimated figures will be acceptable; points which have come to the attention of the Board's staff include; - 2 - R-915-d Items III-A-2 and III-A-3. - According to the strict wording of the questions these items call only for retail and personal instalment paper, and exclude loans not payable in instalments and loans for business or agricultural purposes. Mortgage loans, other than loans for repair or modernization purposes, are also to be excluded. In the case, however, of an institution that holds some non-instalment loans or business loans or agricultural loans or mortgage loans and would find it excessively burdensome to make an exact separation of such loans from its personal and retail instalment paper, the Registrant may estimate the amount of such loans to be excluded, or where the amount is very small the Registrant may ignore them. Item III-B-4. - There will be seme small Registrants for whom the compiling of their sales for a 12-month period ending on or about September 30 would be inconvenient; such Registrants may estimate their sales for this 12-month period. There will also be some Registrants who compile their sales figures on the basis of net sales after the deduction of trade-ins and cannot conveniently determine the amount of such trade-in allowances; such Registrants should be asked to estimate the value of goods accepted in trade and to include this figure in their total sales. Treatment of instalment paper pledged, discounted, or sold. The general principle to be followed with respect to instalment paper that is pledged as security for a loan is that such paper should be reported as held b£ the borrower or pledgor, and should not be reported by the lender or pledgee. The general principle with respect to instalment (or other) paper that has been sold or discounted (with or without recourse) is that such paper should be reported b% the purchaser, and should not be reported by the seller. Credits charged off. A Registrant, in reporting the amount of credit outstanding against question III-A or under items 6 and 7 of question III-B, may either exclude or include credits which have been charged off the Registrant's books — whichever procedure is in accord with the customary practice of the Registrant. Sales and credits to include those relating to unlisted as well as listed articles. The figures on sales to be reported against item III-B-4 and III-B-5 should include all retail sales of the Registrant (except sales of electricity or gas by a public utility and sales of real estate) — and should - 3 - R-915-d 189 not be confined to sales of articles of the types listed in the Supplement to Regulation W. Likewise the figures on credit outstanding to be reported against items III-A-1, III-A-2, III-B-6, and III-B-7 should not be confined to credit connected with articles of the types listed in the Supplement to Regulation W. Treatment of down-payments on instalment sales. In answering question III-B-5, which calls for the approximate percentage of instalment sales, other credit sales and cash sales, the Registrant should include the down-payments received on instalment sales in making his estimate of instalment sales notwithstanding the fact that his custom may bo to count such amounts as cash sales. C.O.D. sales not instalment credit. The fact that a C.O.D. sale may be payable in two parts, a deposit at the time of purchase and the balance payable on delivery, does not make it an instalment sale for purposes of question III-B, as no instalment credit is involved; all such C.O.D. sales should be considered as cash sales. Question regarding control of Registrant. Question V, regarding control of Registrant's stock, is asked for the purpose of obtaining information that will assist in combining the figures reported by related companies and in classifying the Registrants. Therefore, in complex cases involving difficult questions of legal ownership or control of stock, a Registrant should be permitted to attach to its registration statement a brief summary of the relevant facts regarding ownership or control of its stock, and need not be required to give a definite "yes or no" answer to the first part of question V in every case. Registrant controlled by several other companies. In the event that 50 per cent or more of the voting stock of a Registrant is owned by a second company and 50 per cent or more of the voting stock of the second company is owned or controlled by a third company, the Registrant is controlled "directly or indirectly" by both the second and the third companies, and should list both or such companies in answer to question V. This will, of course, require in a few cases the attaching of an extra sheet to give the names of such controlling companies. Registrants beginning business on or after January 1, 1942. Form F. R. 563 is designed for the registration of persons who were engaged in the instalment credit business on or before December 31, 1941. It is intended that a slightly different foim, appropriate for persons beginning business after December 31, 1941, will be made available before that date. - 4 - R-915-d Persons extending instalment credit of types exempted from Regulation W by section 6.The requirements of Regulation VJ regarding registration apply to all persons who are engaged in the business of selling listed articles for payment in instalments, or making instalment loans of less than $1,500, or making instalment loans of any amount which are secured by listed articles, or purchasing or discounting or lending on such instalment obligations, notwithstanding the fact that all of the credit extended by such a person may be credit of the types exempted by section 6 of the regulation. Registrant-s having subsidiaries which extend instalment credit.Since each corporation which extends instalment credit of the specified types is required to register, the report of a corporation or other business concern having subsidiaries which also are required to register should include only its own figures and not those of its subsidiaries. If the reporting of separate figures should be unreasonably difficult, the division of the credit outstanding and sales (question III) between the parent company and its subsidiaries and among the subsidiaries may be estimated. Credit unions and building and loan associations.In connection with the distribution of" foims to credit unions by the Farm Credit Administration and the Credit Union National Association and to building and loan associations by the Federal Home Loan Bank Board, it is contemplated that some additional instructions will be sent out in order to assist those classes of Registrants in filling out their registration statements correctly. Copies of these instructions, which will be cleared in advance with the Board, will be sent to all Federal Reserve Banks for their information. Issuance of "Registration Certificates" to Registrant with several offices.In case a Registrant having several offices requests the issuance of one or more duplicate "Registration Certificates", in order to be able to supply a copy to each of its branches, the Reserve Bank may comply with the request. Additional questions.As to questions which are not covered, either by the instructions accompanying the form or by the foregoing not- s, the Reserve Bank will use its o-m judgment as to whether to answer or to forward the question to the Board. October-30, 1941•
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