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Dallas, Texas, March 3,1945


To All Banking Institutions, and Others Concerned,
in the Eleventh Federal Reserve District:
There is reproduced herein the full text of the press statement
released today by Secretary of the Treasury Morgenthau, announcing
the dates and the goal for the Seventh War Loan Drive, as well as the
types of securities to be offered during the drive.
Yours very truly,

This publication was digitized and made available by the Federal Reserve Bank of Dallas' Historical Library (






: ; l







For Release, Morning Newspapers, Saturday, March 8, 1945



Secretary Morgenthau announced today the typos of securities to be sold in the Seventh
War Loan Drive and the periods during whiph intensive campaigns will be conducted to sell
these securities to the various classes of investors.
The goal for the Seventh War Loan has been set at $14,000,000,000, of which $7,000,000,000
is to come from sales to individuals and $7,000,000,000 from other nonrbank investors. Again
the major emphasis throughout the entire drive will be placed on the quota for individuals,
which is the highest established in any o£ the War Loan drives. Of that quota, $4,000,000,000
has been established as the goal for Series E war savings bonds, which is also the highest quota
established in any drive for that security.
The goal and the securities to be offered were determined by the Treasury after full dis­
cussion with various groups, including chairmen of the State War Finance Committees, officials
of the Federal Reserve System, members of the American Bankers Association, representatives
of insurance companies, and other investment authorities.
The Secretary stated that there is every evidence that Federal expenditures are going to
remain at a high level for some time to come, and that the Seventh War Loan program was
designed to obtain from non-bank investors maximum funds necessary to prosecute the war.
The securities, which will be sold under the direction of the State War Finance Committees,
are as follows:
Series E, F and G Savings Bonds
Series C Savings Notes
21/2 percent Bonds
214 percent Bonds
1y<2, percent Bonds
7/8 percent Certificates of Indebtedness
(The 1i/2 percent bonds will not be offered in the drive to corporations.)
The drive for individuals will extend from May 14 to June 30. However, an intensification
of activities in the sale of Series E bonds will begin April 9, when millions of persons on pay­
roll savings plans throughout the country will be asked to enlarge their participation as a part
of the Seventh War Loan. All Series E, F and G Savings Bonds and Series C Savings Notes
processed through the Federal Reserve banks between April 9 and July 7 will be credited to
the drive.
During the final phase of the drive, which will cover the period from June 18 through
June 30, subscriptions will be received from all other non-bank investors for the 2^4 percent
and the 21/2 percent marketable bonds and the certificates of indebtedness.
The Treasury will request that there be no trading in the marketable securities and no
purchases of such securities other than on direct subscription until after the closing of the drive
on June 30.
To avoid unnecessary transfers of funds from one locality to another, the Treasury again
urges that all subscriptions by corporations and firms be entered and paid for through the bank­
ing institutions where funds are located. This request is made to prevent disturbance to the
money market and the banking situation. The Treasury will undertake, as in the Sixth War
Loan Drive, to see that statistical credit is given to any locality for such subscriptions as the
purchaser may request, except that subscriptions from insurance companies will be credited to
the State of the home office as in the past. The Treasury appreciates the substantial cooperation
it has received in this respect.
In order to help in achieving its objective of selling as many securities as possible outside
of the banking system, the Secretary will request the cooperation of all banking institutions in
declining to make speculative loans for the purchase of Government securities, and in declining
to accept subscriptions from customers which appear to be entered for speculative purposes.

The acquisition of outstanding securities by banks on the understanding that a substantially
like amount of the new securities will be subscribed for through such banks, thus enabling them
to expand their War Loan deposit balances, is regarded as an improper practice by the Treas­
ury. The Secretary will request banking institutions not to make such purchases, and not to
make loans for the purpose of acquiring the drive securities later for their own account. The
Treasury is in favor of the banks making loans to facilitate permanent investment in Govern­
ment securities provided such loans are made in accord with the joint statement issued by the
National and State bank supervisory authorities on November 23, 1942.
The Treasury requests that all non-bank investors refrain from selling securities hereto­
fore acquired to obtain funds to subscribe for the securities offered in the Seventh War Loan
Drive. However, this request is not intended to preclude normal portfolio adjustments.
Life insurance companies, savings institutions, and states, municipalities, political sub­
divisions and similar public corporations, and agencies thereof, will be permitted to make
deferred payment, at par and accrued interest, for the 2% and 2 ^ percent marketable bonds
allotted to them, up to August 31, 1945.
During the period from June 18 through June 30 commercial banks, which are defined for
this purpose as banks accepting demand deposits, will be afforded an opportunity to subscribe
for Series F and Series G Savings Bonds, and for the l 1 percent bonds and the % percent
certificates offered in the drive, in aggregate amounts not exceeding $500,000 or 10 percent of
the time deposits (of which not more than $100,000 may be Series F and Series G Savings
Bonds) under the same formula as was used during the last drive. Securities so acquired by
the banks will not be included in the drive nor will they be counted toward any quota.
Commercial banks will not be permitted to own the 2 percent or the 214 percent mar­
ketable bonds offered in the drive until within ten years of their respective maturity dates.