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FEDERAL RESERVE BANK of D A L L A S Number 33* FINANCIAL STATEMENT FORMS FOR FARMERS AND STOCKMEN. February 2 8 t h , 19 X 6 . TO THE MBEBER BANK ADIRESSED: In the re d is c o u n tin g o p era tio n s o f t h i s bank s in c e i t s o rg a n iz a tio n a la r g e p ro p o r tio n o f the n otes handled has been f o r member banks whose paper c o n s i s t s to a la r g e ex ten t o f n o tes g iv e n by farm ers and stockm en, and t h i s has d evelop ed a demand by th ose banks f o r f i n a n c i a l statem ent forms which s e t out more c le a r l y th e a s s e t s and l i a b i l i t i e s o f custom ers of th a t c h a r a c te r . To su p p ly t h is need , we have prepared and e n clo se specimens o f a form f o r farm ers and one f o r stockm en, which we b e li e v e w i l l b e found to be com p re h e n siv e a s w e l l .a s s im p le . By h aving th e blanks made in la r g e q u a n t i t i e s , we are a b le t o fu r n is h them to our members a t th e very low a c tu a l c o s t of 35^ p er hundred,and o rd e rs w i l l be prom ptly f i l l e d upon r e c e i p t . In view o f the f a c t th a t th e se form s w i l l co n ta in very v a lu a b le c r e d it in fo rm a tio n which i t i s im p o ssib le to show on th e "A b str a c t and Summary" b lan k p r e v io u s ly recommended f o r su b m ittin g c o p ie s o f sta te m e n ts, we su ggest th a t when o f f e r i n g th e paper o f stockmen and farm ers 6 # whom you have a sta te m e n t, i t be accompanied by a copy o f th e one which i s r e ta in e d in your f i l e s , show in g the in fo rm a tio n on both the f a c e and th e r e v e r se o f th e fo rm . There i s evidence from a l l q u arters th a t th e p r a c t ic e o f r e q u ir in g borrowers o f any consequence t o fu r n is h and renew from tim e t o tim e statem en ts o f t h e i r f i n a n c i a l c o n d it io n i s b ein g d eveloped very r a p i d l y , and d u rin g th e p a s t tw elve months t h i s bank alone has d is t r ib u t e d among i t s members n e a rly 1 0 0 ,0 0 0 b la n k f i n a n c i a l statem ent fo r m s. T h is p r a c t i c e should i n the fu t u r e r e s u l t i n a g re a t r e d u c tio n o f th e r i s k a tte n d in g the e x te n sio n o f c r e d it by members bank t o t h e ir custom ers* as w e ll as a ip a te r ia l advantage t o th o se cus tomers th em selves who a re e n t i t l e d to accommodation, f o r th e reason th a t a c le a r statem ent o f worth in su re s them o f c o n s id e r a tio n by t h e ir bank, whereas la c k o f t h i s in fo rm a tio n r e s t r i c t s t h e ir borrow ing a b i l i t y and makes th e o f f i c e r s o f th e bank u n c e r ta in o f th e a t t i t u d e to be assumed toward them. I t i s , t h e r e f o r e , a m atter o f s e l f - i n t e r e s t fo r member banks t o educate t h e ir custom ers a lo n g t h i s l i n e . The evid en ces o f c o o p e ra tio n th a t We have r e c e iv e d i n our e f f o r t s t o fu r th e r such a reform a re v e ry g r a t i f y i n g to th e management o f t h i s bank, and the maintehance o f our C r e d it In fo rm ation Department sh o u ld , and we have d a i ly evidences th a t i t w i l l , r e s u lt i n a t a n g ib le b e n e fit not only t o our E xecu tive Committee in c o n s id e r in g o f f e r i n g s , but to th e banks them selves in th at they make a c le a r e r e x p o s itio n o f t h e ir methods and a b e t te r p r e s e n ta t io n o f the pap er submit t e d . I t i s hoped th a t t h i s s p i r i t of c o o p e ra tio n w i l l con tin u e and th a t we can a l l j o i n hhnds in an e f f o r t toward the betterm ent o f p a s t methods of carin g f o r th e le g it i m a t e needs o f the commercial ahd a g r i c u lt u r a l i n t e r e s t s o f t h is d is tr ic t. R e s p e c t f u lly , R .L . VAN ZANDT - Governor. This publication was digitized and made available by the Federal Reserve Bank of Dallas' Historical Library (FedHistory@dal.frb.org)
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