Full text of Federal Home Loan Bank Review : April 1936, Vol. 2 No. 7

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Vol. 2

MEmt

No. 7

FEDERAL

HOME LOAN BANK

REVIEW
APRIL
1936

ISSUED BY
FEDERAL HOME LOAN BANK BOARD
WASHINGTON D.C.




Federal Home Loan Bank Review
TABLE OF CONTENTS
Page

Foreclosures and new residential construction in large urban counties

229

Commercial banks and the mortgage lending business

233

What determines the eligibility of an association for insurance or conversion?

238

Neighborhood standards as they affect investment risk

241

Evidences of recovery in the savings and loan business

244

A uniform fiscal year for savings and loan associations

247

Steps in the operation of the home-building service plan

248

Indexes of small-house building costs

251

Residential construction activity in the United States

253

Growth and lending operations of the Federal Home Loan Banks
Interest rates on advances to member institutions

258
259

Combined statement of condition of the Federal Home Loan Banks

260

Federal Savings and Loan System

262

Federal Savings and Loan Insurance Corporation

264

Home Owners' Loan Corporation

266

Subscriptions to shares of savings and loan associations

266

Applications received and loans closed, by months

266

Summary of operations of the Reconditioning Division

267

Foreclosures authorized and property acquired

267

Directory of member, Federal, and insured institutions added during FebruaryMarch

268

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APPROVED BY THE BUREAU OF THE BUDGET

Federal Home Loan Bank Board
JOHN H. FAHEY, Chairman
WILLIAM F. STEVENSON

T. D. WEBB, Vice Chairman
F. W, CATLETT

H. E. HOAGLAND

OFFICERS OF FEDERAL HOME LOAN BANKS
BOSTON:
B. J. ROTHWELL, Chairman; W. H. NEAVES, President; H. N. FAULKNER, Vice President;
FREDERICK WINANT, JR., Secretary-Treasurer.

NEW YOKK:
GEORGE MACDONALD, Chairman; G. L. BLISS, President; F. G. STICKEL, JR., Vice PresidentGeneral Counsel; ROBERT G. CLARKSON, Vice President-Secretary; DENTON C. LYON, Treasurer.
PITTSBURGH:

E. T. TRIGG, Chairman; R. H. RICHARDS, President; G. R. PARKER, Vice President; H. H. GARBER,

Secretary-Treasurer.
WINSTON-SALEM :

IVAN ALLEN, Chairman; 0 . K. LAROQUE, President-Secretary; G. E. WALSTON, Vice President-

Treasurer.
CINCINNATI:

H. S. KISSELL, Chairman; W. D. SHULTZ, President; W. E. JULIUS, Vice President; A. L. MADDOX,
Treasurer; T. DWIGHT WEBB, JR., Secretary.
INDIANAPOLIS:

F. S. CANNON, Chairman; FRED T. GREENE, President; B. F. BURTLESS, Secretary-Treasurer.
CHICAGO:

H. G. ZANDER, Chairman; A. R. GARDNER, President; HAROLD WILSON, Vice President; E. H.
BURGESS, Treasurer; CONSTANCE M. WRIGHT, Secretary.
DES

MOINES:

C. B. BOBBINS, Chairman; R. J. RICHARDSON, President-Secretary; W. H. LOHMAN, Vice Pres-

ident-Treasurer; J. M. MARTIN, Assistant Secretary; A. E. MUELLER, Assistant Treasurer.
LITTLE R O C K :

J. GILBERT LEIGH, Chairman; B. H. WOOTEN, President; H.D.WALLACE, Vice President; J. C.
CONWAY, Secretary; W. F. TARVIN, Treasurer.

TOPEKA:
C. B. MERRIAM, Chairman; C. A. STERLING, President-Secretary; R. H. BURTON, Vice President-

Treasurer.

PORTLAND:

F. S. MCWILLIAMS, Chairman; C. H. STEWART, President; IRVING BOGARDUS, Vice President-

Treasurer; W. H. CAMPBELL, Secretary; MRS. E. M. SOOYSMTTH, Assistant Secretary.
Los ANGELES:
C H. WADE, Chairman; M. M. HURFORD, President; F. C. NOON, Secretary-Treasurer.




Foreclosures and New Residential
Construction in Large Urban Counties

W

Loan Bank Board. This chart pictures the
inverse movements of foreclosures and
building permits from 1926 to date in some
75 large urban counties with populations of
100,000 or more. 1 The chart measures per-

HEN foreclosures go up, the number
of dwelling units for which permits
are granted go down and when foreclosures go down, building permits go in the
opposite direction. The intimacy of this
relationship is revealed in the accompanying chart prepared by the Division of Research and Statistics of the Federal Home

. * Permit data are for the cities contained in the counties
only, whereas i n all but eight instances foreclosures are
for the entire county. The slight difference in area covered
does not affect the comparability of the data.

FORECLOSURES AND RESIDENTIAL CONSTRUCTION
Percent of change over 1926 in foreclosures, building permits, housing rentals, and building costs in cities of 100,000 or more population.
(1926

TO

DATE)

D M J S D M J S D M J S D M J S D M J S D M J S O M J S O M J S D M J S O M J S O M J S O M J S p
J926
1927
1928
1929
J930
1931
1932
1933
1934
1935
1936
1937
SOURCE:- I.
2.
3.
4.

April 1936




Federal Home Loan Bank Board
Composite Data of F. R.B. of N.Y. and Dept. of Labor
National Ind. Conf. Board (Not confined to cities of 100,000)
Compiled by F H.L.B.B. from Reports to Dept of Labor

p » Preliminary Figure

229

crease probably represented a cumulation
of properties on which foreclosures had
been delayed due to weakness of the market, and was, paradoxically, a healthy
sign. Since the middle of 1935, however,
the drop has been marked until in February 1936 the number of foreclosures in the
75 cities was lower than at any time since
1931. Nevertheless, it was still nearly three
times as high as the annual average for
1926, which indicates that it is still a retarding factor in the recover of the construction
industry.
In almost direct contrast to the movement of foreclosures, the number of dwelling units for which permits were granted in
the reporting cities fell steadily from 1926
to the beginning of 1933 and did not achieve
a substantial gain until the last nine months
of 1935, during which foreclosures were
falling sharply.
The movements of housing rentals and
of the cost of construction are also shown
in the chart because of the light they

centages of change up and down from activity during the year 1926, which is taken
as a base. To give an approximately accurate visual comparison between increases and decreases, the area below the
base line is on a very much larger scale
than the area above the line. The necessity of this will be apparent when it is
realized that it would require a 100-percent
increase to overcome a 50-percent decline,
and a 200-percent increase to overcome a
66%-percent decline.
Following the foreclosure line, we notice
a steady climb upward from 1926 to the
peak in June 1933. The decline which
began in the fall of 1933 and continued
through most of 1934 was due largely to
the refinancing activities of the Home
Owners' Loan Corporation. By early 1935,
when the Corporation had substantially
completed its acceptance of applications
and the real-estate situation had begun to
show improvement, the number of foreclosures increased for a time. This inTABLE

1.—Index of number of foreclosures in 75 large urban counties with populations over 100,000l
[1926=100]
[Source: Federal Home Loan Bank Board.

Period
1926
1927
1928
1929
1930
1931
1932
1933
1934:
January...
February.
March
April
May
June
July
August
September
October...
1
2

Compiled from reports received from county officials and others]

Index
100
137
180
212
235
300
382
395
370
359
323
368
357
375
376
371
370
378
389

Period
1934 (cont.):
November.
December.
1935:
January...
February..
March
April
May
June
July
August
September
October...
November
December.
1936:
January..
February.

Index

399
377
366
431
352
412
398
405
395
368
365
337
333
297
304
2

287
260

Combined population of reporting counties is approximately 42,790,000 (1930 Census).
Preliminary figure.

230




Federal Home Loan Bank

Review

throw on future construction possibilities.
It will be noted that after falling continuously from 1926 to the end of 1933, rentals
began to move upward slowly but regularly. Observers of the construction cycle
have noted that material improvement in
construction volume usually does not appear until a year or more after rents have
begun to climb. The present chart confirms that observation. The cost of building has altered but little. The most hopeful feature of the trend of building costs is
its relative stability during the last two
years as compared with the slow rise in
rentals and the decrease in foreclosures.
NUMBER OF FORECLOSURES IN 75 LARGE
URBAN COUNTIES

T H E number of foreclosures in each of the
75 large urban counties for the years 1926,
1932, 1933, 1934, and 1935 are shown in
table 2. In nearly every instance foreclosures are reported for the county in
which the city is located so that the figures represent foreclosures for the larger
areas. For most counties, the data are furnished by county officials—county clerks,
sheriffs, or probate judges—and for a few,
they are furnished by private agencies
such as university research bureaus and
title companies. As indicated in table 2,
60 counties report completed foreclosures
and 18 report foreclosures filed. It has
been found that approximately 85 percent
of foreclosures filed are eventually completed. This fact should be kept in mind
in making a comparison between the number of foreclosures in different cities.
Mortgage institutions will, of course, be
particularly interested in the types of property foreclosed. Analysis of foreclosures
in several cities indicates that foreclosures
on 1- to 4-family dwellings comprise at
least 75 percent of total foreclosures.
In future the number of foreclosures in
the cities shown in table 2 will be reported
by months twice a year.

April 1936




AN INDEX OF FORECLOSURES
W I T H this issue, the Review begins the
monthly publication of a combined index
of foreclosures for the large urban counties
listed in table 2. The combined population of these 75 areas is approximately
42,790,000, which represents about 30 percent of the population of the United States.
It is believed that this index will reflect
fairly accurately the movement of foreclosures on urban properties in the country
as a whole.
The index figures for the years 1927 to
1931 inclusive are based on data for 13
counties only. In the construction of the
final index, the annual averages for these
13 counties were related to 1926 as a base
and were spliced to the index for all 75
counties, so as to give a rough idea of the
movement of foreclosures during the 19261931 period.
In compiling the index no adjustment
is made for the 14 counties reporting foreclosures filed instead of foreclosures completed. As a test of the validity of this
combination, separate indexes were prepared for foreclosures filed and compared
with the index which is presented here.
The results showed such uniformity in the
trend of variations and in the amplitude
of the fluctuations as to justify the use of
the total index because of its more complete coverage.
Table 1 shows the yearly index of foreclosures from 1926 to 1935 inclusive, and
the monthly indexes for the years 1934,
1935, and 1936. It will be noted that the
index dropped to 260 (preliminary figure)
in February, making a new low for the past
five years. The 9-percent decrease from
January to February compares with an
average seasonal decrease of 8 percent.
Of the counties on whose reports the index is based, 20 reported increases in foreclosures for February as compared with
January, 39 reported declines, and 1 reported no change.

231

TABLE

2.—Number of foreclosures in 75 large urban counties with populations over 100,000, by years:
1926-1935
the city mentioned.
In most instances the number of foreclosures is for the county conl
ly dwellings.
Approximately 75 percent of all foreclosures are on 1- to 4-fi
[Source: Reported by county officials and others to the Federal Home Loan Bank Board]

Federal Home Loan Bank Districts, States, counties, and
principal cities included
District no. 1:
Connecticut:
Hartford (Hartford)
New Haven (New Haven)...
Massachusetts:
Suffolk (Boston)
Middlesex ( s o u t h e r n district) »
Bristol (Fall River district)..
Essex (southern district—
Lynn)
Worcester

(Worcester dis-

Rhode Island:
Providence (Providence)....
District no. 2:
New Jersey:
Union (Elizabeth) *
Essex (Newark)
Mercer (Trenton)
New York:
Erie (Buffalo)
Kings (Brooklyn)
Queens County *
Richmond (Staten Island) *..
Oneida (Utica) i
Westchester (Yonkers)
District no. 3:
Pennsylvania:
Philadelphia (Philadelphia)
Allegheny (Pittsburgh)

1932

1926

71
89
94 1

257
458
332

1933

238
489
485

1934

206
428
456

1935

284
315
598

733 2,467 2,703 2,438 2,778
741 2,892 3,118 2,854 3,182
106
205
172
220
271
204
918 1,122
933
950
695
1,043 1,123 1,200 1,260
1, 494
479
932
974
894
477

576

134

599

9
199
237
272
104
40

1,137
1,839
1,445
2,161
767
697

776
910
1,275
2,029 1,901 1,586
1,576 1,370 1,495
2,855 2,575 3,015
915
810
912
734
651
605

425
484
1,368
45
258
119
248

1,587
3,050
4,955
409
1,180
308
1,432

2,291
3,047
4,927
535
1,465
294
1,674

592

2,035
4,490
6,075
533
2,010
357
2,404

2,295
6,553
5,709
471
2,304
353
2,641

4,686 18, 951 18, 464 16, 822 13,181
406 2,330 2,408 2,399 3,407
857 1,072
693
89
805

District no. 4:
Alabama:
Jefferson (Birmingham)
District of Columbia:

148 4,167 3,232 2,237 2,416
442

Florida:

958 1,204 1,133

2,273
919
1,122 1,915

F)ad« (Minnrii) *

Hillsborough (Tampa) i
Maryland:

730
559

402
289

635 |
367
254

2,128 2,630 2,845 2,275 2,067

Virginia:

Kentucky:
Ohio:
Stark (Canton)
Lucas (Toledo)
Mahoning (Youngstown)
Tennessee:
Shelby (Memphis)

1

...

145

380

295

898 1,277

375

314

328

860 1,056

142
783
701 1,008
654
124
847
887
889 1,109
1,178 3,937 1,840 1,921 4,125
247 1,191 1,221 1,206 1,583
287
573
737
945
731

Federal Home Loan Bank Districts, States, counties, and
principal cities included
District no. 6:
Indiana:
Allen (Fort Wayne) i
Lake (South Bend)
Michigan:
Wayne (Detroit)
Genesee (Flint)
District no. 7:
Illinois:
Cook (Chicago) *
Peoria (Peoria)
Wisconsin:
Milwaukee (Milwaukee) * . . . .
District no. 8:
Iowa:
Polk (Des Moines) *
Minnesota:
St. Louis (Duluth)
Hennepin (Minneapolis)
Ramsey (St. Paul)
Missouri:

1926

75
140
24

295
497
407

1935

531
746
763

809 5,059 5,348 5,144 3,567

385

642

545

394

323

366
492
138
310
444
441 1,679 2,302 2,242 1,943
677
227
761
603
605
975 2,110 2,472 1,709 2,174
320 2,734 2,890 1,931 1,769
983

782

138
268
180
405 1,340 1,408
212
132
288

108
958
169

232

609

691

534

364

128

425

449

492

389

190
303

514
769

650
631

599
542

677
711

569 1,199

925

777

899

362

171

181

896

District no. 11:
Oregon:
Utah:
Salt Lake (Salt Lake City)
Washington:
King (Seattle)
Spokane (Spokane)

355
449
483

1934

1,435 15,187 16, 031 12, 535 9,791
126
181
40
136
205

163

Nebraska:
Douglas (Omaha)
Oklahoma:
Oklahoma (Oklahoma City). .
Tulsa (city only)

612
518
457

1933

680 7,216 10, 081 13, 463 14,137
627
468
734
91
655
934
824
49
891
871

District no. 9:
Louisiana:
Texas:
El Paso (El Paso)
Tarrant (Fort Worth)
Bexar (San Antonio)
District no. 10:
Colorado:
Denver (Denver)

1932

92

321

859

0)

98

238

307 1,226 1,428 1,417 1,005
261
175
145
112
242
276
105
194
295
330

District no. 12:
California:
Los Angeles (Los Angeles) . . . . 4,997 11, 773 12, 884 10, 614 8,546
Alameda (Oakland)
353 2,103 1,913 1,709 1,391
236 1,320 1,142 1,092
763
San Francisco (San Francisco).
130
904
974
787
828

604 1,806 1,644 1,799 1,297
382
853
673
815
589

i Reports number of foreclosure actions filed. About 85 percent of foreclosures filed are eventually completed.
* No report.
* Includes the cities of Cambridge, Somerville, Maiden, Medford, Newton, Waltham, and Everett.

232




Federal Home Loan Bank

Review

Commercial Banks and the Mortgage
Lending Business

S

EVERE competition for loans is a relatively new experience for most savings and loan associations. In the first
place, many of these institutions have operated in communities where the demand
for home-financing funds exceeded the supply. In the second place, their use of the
long-term amortized-loan plan gave them
a virtual monopoly of a large part of the
home-financing business. As a result of
these advantages, savings and loan associations were largely free to adopt what
lending policies they saw fit.
Today, the situation is completely
changed. All types of lending institutions
are offering long-term amortized homemortgage loans. An excess of idle funds,
coupled with the standards set by the
Home Owners' Loan Corporation and the
activities of the Federal Housing Administration, has brought down interest rates.
The absence of desirable investments has
turned the attention of commercial banks
as never before to home mortgages. In
short, the first borrowers' market in the
history of home financing in this country
seems to have arrived. If they are to
make their share of desirable home loans,
savings and loan associations must adapt
their lending policies to meet the new
conditions.
The entry of commercial banks into the
home-financing field is of special significance to thrift, home-financing institutions. Like themselves, commercial banks
are local institutions and possess lending
advantages which permit them to offer
severe competition. At the Third Annual
April 1936




Convention of the Mortgage Conference of
New York on February 27, Mr. J. H. Riddle,
Economist of The Bankers Trust Company, in New York, analyzed trends and
other factors in the banking situation
which might indicate how far commercial
banks may enter the mortgage-lending
business. Through the courtesy of the
author and of the Mortgage Conference,
the REVIEW is privileged to publish Mr.
Riddle's address in slightly condensed
form.
ADDRESS BY J. H. RIDDLE, ECONOMIST OF THE
BANKERS TRUST COMPANY

DURING both the period of expansion in the
1920's and the period of contraction since that
time the general character of banking in this
country has been undergoing rapid changes,
changes which have left many of us somewhat
confused as to the ultimate function of banks
and as to the adjustments which may be necessary to meet these developments.
CHANGING CHARACTER OF BANK ASSETS

LET us look for a moment at the changing character of bank assets. A statistical analysis of
bank portfolios indicates that in recent decades
we have been getting further and further away
in practice from true commercial banking and
that the proportion of bank assets consisting of
capital loans and investments has been growing.
For the sake of brevity and convenience I am
including investments, collateral loans, and realestate loans under the term "capital assets", as
distinguished from the category of "all other"
loans which include the commercial loans made
by banks. These "all other" loans have declined
in round figures from about 60 percent of total
loans and investments in 1920 to about 20 percent in 1935. "Capital assets", on the other
hand, have increased from about 40 percent to
80 percent in the same period. "All other" loans

233

are now only about 40 percent as large in volume
as they were in 1928 and about 35 percent as
large as in 1920. Investments, however, have
continued to rise and are now more than twice
as high as in 1920. The ratio of investments to
total loans and investments has increased from
23 percent in 1920 to nearly 60 percent in 1935.
A large proportion of these are, of course, government securities. Up until about 1932 or 1933
real-estate loans showed the same general trend
as investments. The above figures relate to all
national banks in the United States, but the same
general pattern is shown whether we take the
State banks or the national banks, the city banks
or the country banks. In other words, the trend
has not been confined to any particular type of
institution or to any particular sections of the
country.
Even the "all other" loans cannot all be assumed to be pure commercial or self-liquidating
loans. It is impossible to analyze that figure to
determine what proportion are capital loans and
what proportion are commercial loans in the old
sense of the word. It is doubtful, however,
whether there are more than $4,000,000,000 or
$5,000,000,000 of the old type self-liquidating
commercial loans in our whole banking system.
That figure clearly indicates that we do not have
a commercial banking system today in the narrower sense of that term.
The fact that I want to emphasize here is that
at no time in recent years have the commercial
banks been able to invest more than a small part
of their funds in commercial loans. As a consequence they have gone into other assets including real-estate loans. The question which comes
to mind immediately is whether this trend toward capital assets is likely to continue in the
future. Without attempting a forecast we may
inquire briefly as to what were the factors responsible for this trend in the past and see if
these same influences are operating at the present time. I think perhaps there are four things
which are primarily responsible for this trend:
(1) speedier processes in industry and transportation and the consequent smaller need for working capital; (2) changes in the methods of corporate financing, especially in the large corporations; (3) easy reserves and the pressure upon
banks to expand; (4) the growth of time deposits.
One important cause of the growth of capital
assets has been the reduction in the amount of
working capital requirements of manufacturing and commercial firms. Improvements in
manufacturing technique greatly shortened the
processes of manufacture, which reduced the
amount of working capital tied up. Likewise,
faster transportation and improved inventory

234




control reduced the amount tied up in raw materials and finished products. These tendencies
are just as likely to continue in the next decade
as in the past, as are hand-to-mouth buying, instalment financing, and buying of receivables by
finance companies.
Another important factor reducing the need
for short-term borrowings by business was a
change in method of financing. As the result of
their unfortunate experience with short-term
loans in the depression of 1920-1921, and aided
by free and easy securities markets in the 'twenties, many corporations not only greatly reduced
their bank borrowings but many of them accumulated liquid surplus funds as well.
The trend toward capital assets was further assisted by easy reserve conditions, which encouraged the expansion of bank credit in every
available form. Excess reserves today are higher
than ever before in our history and this excess,
coupled with greatly reduced earnings, is putting
banks under greater pressure than ever to find
use for their idle funds.
The fourth factor which we have listed as
responsible for the increase in capital assets has
been the growth of time deposits. Time deposits, including savings, composed only about 5
percent of the total deposits of all national banks
in 1900. By 1920 that figure had increased to
25 percent and by 1932 to almost 50 percent.
Since 1932 it has declined substantially. If we
take the banks outside of the metropolitan centers the figures are even more striking. For
the commercial banks in New York State outside New York City, for example, time deposits
now aggregate nearly 60 percent of total deposits.
Turning again to the national picture, almost the
entire growth in deposits of national banks from
1920 to 1929 was in time deposits, which more
than doubled in those nine years. This tendency
towards an increasing percentage of time deposits to total deposits has been reversed during recent years, especially in 1934 and 1935
when demand deposits increased rapidly as a
result of the fiscal activities of the government.
This increase in time deposits doubtless came
largely from the savings of the people although
there was probably a substantial shift from slow
demand deposits to time deposits. The decade
of the 'twenties was characterized in part by
competition for time deposits by the commercial banks in nearly every section of the country.
Savings have been attracted into the commercial
banks which otherwise might have gone directly
into investments or into other institutions. This
competition led to the payment of high interest
rates on deposits, as high in some sections as
4y2 and 5 percent. In fact interest payments

Federal Home Loan Bank Review

were by far the largest single item of expense
in the banks, and that is still true today in spite
of the elimination of the payment of interest on
demand deposits and the maximum limits fixed
for rates on time deposits.
This striking growth in time deposits on one
side of the balance sheet has paralleled the
growth of capital assets on the other side and is
one of the principal reasons advanced for the
growth of capital assets. Time deposits have
a slower turnover u n d e r normal conditions than
demand deposits and generally have been considered suitable funds for commitments in investments, real-estate loans, and collateral loans.
I don't know to w h a t extent the commercial
banks in the future are going to continue to compete for savings deposits and h o w fast savings
deposits are going to grow. The rates w h i c h
they pay on these deposits will p e r h a p s be u n d e r
better control in the future, and let us hope they
will never be higher than the yields on the highest-grade investments. This may check the rate
of growth somewhat but there is little doubt
but that commercial banks will continue to do
a savings bank business.
The conclusion seems justified, therefore, that
in m a n y respects the underlying factors w h i c h
caused this growth in capital assets in the
'twenties are present and operating today with
even greater force, and are likely to be important
in the next few years, although m a n y enterprises u n d e r the pressure to earn may reduce
the amount of working capital carried permanently and depend on bank borrowings for seasonal requirements.
BROADER POWERS OF BANKS TO LEND ON REAL
ESTATE

T H E point I wish to make in the foregoing discussion is that the banks w i t h surplus funds and
a rather small outlet through commercial loans
will be looking around for places to put their
money. Mortgage loans may be one of the important outlets in the future.
Let us look for a moment at the story of the
gradual broadening of the powers of national
banks to make real-estate loans. As you know,
national banks were not permitted to make realestate loans prior to 1913, but the Federal Reserve Act authorized them to make real-estate
loans within the Federal Reserve District and
u p to 25 percent of capital and surplus or one
t h i r d of time deposits. These powers were
broadened somewhat in 1916, in 1927, and again
in 1935, so that at the present time national banks
m a y lend on real estate anywhere, u p to a maxi m u m of 100 percent of capital and surplus or
60 percent of time and savings deposits. This

235

April 1936
57475—36




gradual broadening of the powers of national
banks to make real-estate loans has been largely
for the purpose of enabling national banks to
compete on a more even basis w i t h State institutions w h i c h in most States have long h a d
rather broad powers for making real-estate loans.
On the basis of the present powers of national
banks the New York State commercial banks
(outside New York City) as a whole could lend
nearly 36 percent of their total deposits on real
estate, whereas actual real-estate loans at present are little more than one t h i r d that amount.
These figures do not apply to the large New York
City banks because they have a comparatively
small amount of time deposits, and have not
invested heavily in mortgages.
While neither State banks nor national banks
have made real-estate loans to the limit of their
powers, even p r i o r to the act of 1935 there has
been a fairly steady u p w a r d trend in the p r o portion of real-estate loans to total assets. For
all national banks, for example, the proportion
of real-estate loans to total loans and investments
increased from less than 1 percent in 1913 to
over 7 percent in 1935. For State banks and
trust companies the percentage is doubtless somewhat larger because they have been in the realestate business longer. If we take all commercial banks in New York State outside New York
City, for example, we find that real-estate loans
rose from about 6 percent of total resources in
1923 to 10 percent in 1929, and apparently are
still around 10 or 11 percent.
There are a number of other factors, in addition to the pressure of funds, for investment and
the broadening of the powers of national banks,
w h i c h might conceivably have the effect of inducing commercial banks to expand their mortgage loans. One of these is the broadening of the
eligibility requirements of the Federal Reserve
Banks so that member banks may b o r r o w from
the Federal Reserve Banks on any collateral satisfactory to the Federal Reserve Banks. The fact
that there is a penalty rate of % percent higher
than the discount rate attached to borrowing on
collateral of this kind may cause banks to utilize
this facility only in cases of emergency. However, the very fact that they can use their mortgages as collateral for borrowing from the Federal Reserve will probably cause them to look
with more favor upon real-estate loans as an
outlet for their funds.
Another factor of substantial importance is
the campaign of the Federal Housing Administration to encourage commercial banks to invest
in guaranteed mortgages. This campaign h a s
caused commercial banks to give more consideration to the mortgage business generally and has

2

familiarized more of them with the principles
of mortgage investment. Just as the Government
sales of Liberty Bonds during the war caused the
public to become bond-minded, I strongly suspect that the campaign of the Federal Housing
Administration has caused many commercial
banks to become more mortgage-minded than
previously.
Still a further factor has been the adoption of
the amortized mortgage which gives a commercial banker a greater sense of security in his investment. The principle of the amortized mortgage is undoubtedly a sound one and its adoption enables commercial banks to have a more
liquid asset and a safer asset than they had
under the old straight mortgage. In fact the
importance of the amortized mortgage cannot be
over-emphasized insofar as the commercial bank
is concerned. The broadening of national-bank
powers to make mortgage loans has been based
on the assumption that they would invest in
amortized mortgages.
In any attempt to peer into the future of the
mortgage business I think there is one more
factor that might be kept in mind as to its effect
on both commercial banks and the mortgage
business. I refer to changes in building methods and building values. There is little question
but that the building industry has been far behind most other modern industries in the rate
of improvements in construction and in value
given. Great improvements are undoubtedly
being effected at the present time and apparently
construction costs are being lowered through the
improved processes. If this improvement continues during the next few years as rapidly, for
example, as the improvement in the automobile
during the past 10 years we might have a big expansion in housing because the would-be home
owners simply could not resist the values. If
such a development occurs on some basis of mass
production with a standardized mortgage it is
not at all improbable that the commercial banks
might be an important factor in financing it.
Such progress, of course, might cause a tremendous amount of depreciation in the older
buildings and raise some real problems for the
holders of the older mortgages, especially the
unamortized mortgages.
That brings me to the final question as to what
the mortgage business will do to commercial
banks. The possibility of rapid progress in the
construction field during the next 10 years makes
great caution in present mortgage-lending necessary. I see no reason, however, why amortized
mortgages made on conservative appraisals
should not prove to be sound investments.

236




SOME PROBLEMS ARISING OUT OF THE UNBALANCED RELATIONSHIP BETWEEN ASSETS AND
LIABILITIES OF COMMERCIAL BANKS

A MUCH more fundamental problem facing those
commercial banks which are accumulating a substantial amount of mortgage loans or other capital
assets arises out of the unbalanced relationship
which exists between assets on the one side and
deposits on the other. As we have previously
stated savings deposits have been assumed to be
more stable and more permanent than demand
deposits and therefore they have generally been
considered suitable funds for commitments in
investments, real-estate loans, and collateral
loans. We have found from experience, however, that time deposits in a commercial bank
are no different from demand deposits in periods
of stress, and that there is no logical argument
for investing them differently. In a period of
severe credit liquidation time deposits are just
as likely to be withdrawn as demand deposits,
and the power to demand notice of withdrawal
is practically worthless.
There are many able students of the subject
who believe that many of our past difficulties in
commercial banking have been due to the poor
quality of assets rather than to the form of the
assets. They assert that the poor quality of realestate loans and bonds as well as short-term
loans has been responsible for most of the losses.
Emphasis upon the quality of assets alone,
however, is not sufficient to meet the problems
arising out of the unbalanced relationship between long-term assets on one side and shortterm liabilities on the other. The weaknesses
of this situation are most apparent in periods of
liquidation, when sometimes the best-grade assets must be sacrificed at depreciated value in
order to meet the demands of depositors. Several suggestions have been made regarding the
solution of the time deposit problem in commercial banks. These suggestions include the
following: (1) separate completely savings banking and commercial banking; (2) segregate the
assets in the two departments; (3) change the
contract with the depositor by the issuance of
debentures or certificates of deposit with maturities of one year or more rather than passbook
credits; (4) give more adequate recognition to
the risks involved by devising a system for building up special reserves to meet losses and depreciation according to past experience. It is not
my purpose to discuss these various suggestions
or to indicate what I think the solution might be.
I merely mention them to illustrate the type of
thinking that is being done on the subject and
to emphasize the need for a solution of some

Federal Home Loan Bank Review

kind if commercial banks continue to increase
their holdings of mortgages and other longterm assets.
In conclusion, it would seem that strong forces
are pressing the commercial banks to invest
profitably an increasing amount of idle funds.
The lack of a sufficient volume of short-term
loans of first quality at survival rates of interest is driving these banks to a choice between
long-term investments and real-estate loans or
idle and excess reserves. It is asking too much
of human nature to expect bankers to jingle all
this money in their pockets for long. They probably won't do it. They will make real-estate

April 1936



loans if good ones are available on amortized
terms at satisfactory rates. And when the depositors again want their money faster than
the loans liquidate, the Federal Reserve Banks
will take them over and give the banks what the
depositors are demanding.
The old model of banking has been pretty well
discarded in favor of the new streamlined model
with all the new gadgets. The new model looks
grand to many of us but whether we like it or
not we have it and must ride in it. Let us hope
that it has non-skid blowout-proof tires and that
the brakes will not fail when we try new speed
records.

237

What Determines the Eligibility of an
Association for Insurance or Conversion?

M

ANY savings and loan associations
that are contemplating share insurance or both share insurance and conversion to Federal charter have expressed a
desire to know what standards they may
have to meet. It is, of course, impossible
to set up a single rigid standard. Every
institution presents a special problem.
The multiplicity of factors to be weighed
one against another requires that the measuring rod be flexible. Moreover, the problem is not wholly one of financial statements
nor figures. Just as a borrower's character
weighs heavily in determining whether or
not he shall be granted a loan, so management must be taken into account in insuring an association. The future of the community and the business prospects are other
important items which must be given due
consideration.
The Insurance Corporation has three general touchstones of eligibility which it applies to all applicants. They are: (1)
solvency; (2) present and future ability to
earn enough to pay dividends that will meet
competitive rates in its community; (3)
efficient management. Where these three
qualities can be easily demonstrated from
the facts at hand, acceptance of an application for insurance is a matter of course. In
handling other applications, the Insurance
Corporation makes whatever additional
examination and analysis prove necessary
either to determine that an association is
eligible or to indicate what steps may be
required to render it eligible.
It will be of interest to many applicants
to illustrate the Corporation's methods and
solutions in dealing with the group requiring extensive examination. For this purpose, the Review Committee of the Federal
Home Loan Bank Board has briefly analyzed five extreme border-line associations
that have already been insured or con238



verted and insured. It must be emphasized
that these are extreme cases, and that in
each association there were factors of
strength underlying the apparent weaknesses. The average association accepted
for insurance or conversion presents a
much better picture of financial condition.
ANALYSIS OF ASSOCIATION

"A"

Apparently unfavorable factors: Reserves
and undivided profits represented only 3.49
percent of assets. Real estate owned represented 35.31 percent of assets.
Favorable and compensating
factors:
Current interest collected equaled 97.82
percent of interest earned. Earnings were
nearly 4 percent of invested capital. Operating expenses were 1.95 percent of assets,
which were not high for a $600,000 association. To balance the high percentage
of real estate owned, it was found that
the association's real estate had all been
reconditioned, was well rented, and was
making a return of almost 3 percent net,
with brighter prospects both as to income
and sales for 1936. The appraisal showed
an excess of approximately 5 percent over
the book value. Real-estate contracts had
been reduced 10 percent and were current
as to taxes and interest. Slow loans representing 8.56 percent of total assets showed
a current performance indicating very few
additional foreclosures.
The association's earnings were sufficient
to attract investors because other associations in the community were paying only 3
percent dividends with no indication of
immediate increases. The trend of this
association had been definitely upward. It
was in a prospering locality where the demand for mortgage money was increasing.
Its management was aggressive. This was
confirmed by the high percentage of interFederal Home Loan Bank

Review

est collections. Further, a neighboring
association with the same type and quality
of management, which had been insured
about a year earlier, had made splendid
progress. For these reasons, the applicant
association was insured and its progress
since insurance has justified the action.
ANALYSIS OF ASSOCIATION " B "

Apparently unfavorable factors: Reserves
and undivided profits totaled only 2.48 percent of assets. Real estate was 25.77 percent and other slow assets were 29.13
percent of total assets. Only 87 percent of
current interest earned was collected. Operating profit equaled 2.53 percent of invested capital. Operating expenses were
2.36 percent of assets.
Favorable and compensating
factors:
Careful analysis revealed that the slow
loans had been so classified due to reformation. Of the 23 reformed loans, only one
was delinquent more than six months and
only four more than two months. Realestate contracts had been reduced 26 percent, with accrued interest amounting to
only $34.56. There were no loans in litigation and none in prospect.
This meant that the 25.77 percent of real
estate constituted almost all the questionable assets. An analysis of the real estate
owned, showed a real-estate reserve of
$4,500 and appraised value of $11,500 over
book value. All real estate had been reconditioned and was well rented, indicating
a current net earning of 2.5 percent.
The association's low percentage of ordinary earnings was due in part to its high
percentage of expenses. To correct this
situation, the association cut expenses and
presented a budget for 1936 which should
permit it to pay 4 percent on its shares and
in addition, increase substantially the
reserve account.
In view of certain unfavorable factors,
notably the type of real estate owned and
the lack of collection experience in reformed loans, this association was required
to pledge the Federal shares issued to
April 1936




holders of guarantee stock in an amount
sufficient to constitute a normal operating
contingent reserve in excess of all indicated
losses. This pledge is to remain until the
present reserves have been increased by an
amount equivalent to the pledge itself.
Also, the pledge carried a waiver of dividends on the shares pledged, to remain in
effect until the association shall have
earned dividends at the rate of 4 percent
on all withdrawable capital for two successive years.
ANALYSIS OF ASSOCIATION "C"

Apparently unfavorable factors: Reserves
were only 1.04 percent of assets. Operating
expenses represented 2.30 percent of assets.
Favorable and compensating
factors:
Only 13.85 percent of the association's
assets was in real estate owned and another 13 percent in other slow assets. Interest collections were exceptionally high.
The apparently low reserve was in part accounted for by the law of the State under
which the association operated, which required 10 percent to be charged off annually
on real estate owned. This might be expected to have the effect of carrying real
estate owned at a figure which would not
require a large reserve. Representative appraisals made by the Federal Home Loan
Bank Board revealed a sufficient excess over
and above the total of real estate owned to
provide a comfortable margin for sales
expenses. In view of this situation and as
indicated losses on loans in litigation and
on contracts, were small, the association's
reserve was considered adequate to justify
insurance of accounts.
The reason for the low actual operating
profit and for the high operating expenses
was the extensive reconditioning of its real
estate. A careful analysis of earnings
showed that the association could depend
upon ordinary earnings of better than 3
percent on its present volume. There was
a large demand for loans. In addition the
management was regarded as exceptionally competent and aggressive, a fact which
239

did much to counterbalance the low reserve and the small margin of earnings
over the dividend rate.
ANALYSIS OF ASSOCIATION " D "

Apparently unfavorable factors: Real estate
owned equaled 16.28 percent and other
slow assets 21.62 percent of total assets.
Operating expenses were 2.61 percent of
assets.
Favorable and compensating
factors:
Reserves and undivided profits represented
5.49 percent of assets. Interest collected
amounted to 99.65 percent of interest
earned. Earnings were 4.30 percent of invested capital.
Independent appraisals
fixed the association's investment in real
estate at 79 percent of its value. Though
the association lost 1.5 percent on realestate operations in 1935, there were indications that it would at least break even
this year. Practically all real-estate contracts were current as to payments and it
appeared that not more than one of them
would revert to real estate. An appraisal
of the slow loans, amounting to 11.31 percent of assets, showed no probable foreclosures and little possibility of loss should
any take place.
A change had been made in the management before the insurance application was
received which should result in a decrease
in operating expenses. Rased on its budget
and judging from the condition of its assets,
the institution should earn over 4 percent
during the coming year. The association
placed $100,000 in new loans in 1935.
The State supervisor's examination of the
association contained many favorable
comments.
ANALYSIS OF ASSOCIATION

"E"

Apparently
unfavorable
factors: Thirtyfour percent of all loans were delinquent
over one year. Slow loans, representing
20 percent of assets, showed unpaid principal totaling 104.5 percent of the original
loans and 72.9 percent of original appraisals.
240




Favorable and compensating
factors:
Reserves and undivided profits were 5.82
percent of assets. Real estate owned was
only 13 percent of assets. Operating
profit was 5.18 percent of invested capital.
Operating expenses were 1.34 percent of
assets. The decisive question was whether
reserves were adequate in view of the
large delinquencies. This was satisfactorily answered by a field examination.
The foregoing illustrations should indicate that every effort is being made to give
associations the benefits of insurance
where their possibilities of service to their
communities justify this action and the insurance coverage can be granted without
undue risk to the Insurance Corporation.
They are, however, by no means typical
of the average association accepted for insurance. The average association approved for insurance has not only demonstrated solvency and ability to earn.
Average reserves approximating 5 percent provide a substantial margin above
indicated losses. Average earnings are approximately 4 percent of invested capital.
WHERE REORGANIZATION IS NECESSARY

ONE question remains, namely, the procedure when an association is found ineligible for insurance without reorganization. Granting the need for an association
in its community, the efficiency of its management, and good prospects for its success, every association can make itself eligible for insurance by reorganization. Reorganization may involve segregation of
assets or a write-down of capital stock, or
both. Sometimes they must be accompanied by a pledge of shares. Many associations have qualified for insurance and
for federalization by reorganization. In
every instance results apparently have justified the step.
The Federal Home Loan Rank Roard
will gladly advise with any association on
the steps necessary to qualify it for
insurance.
Federal Home Loan Bank

Review

Neighborhood Standards as They Affect
Investment Risk
This is the ninth in a series of articles defining the neighborhood standards essential to safety of investment.

T

HE typical gridiron street pattern of
our cities is both wasteful and destructive of home values. It is wasteful for
three reasons: First, the frequent intersections require that more land be devoted to
streets in proportion to building lots than
does any other less formal pattern, and
these intersections have to be paved, sewered, and served with all other public utilities. Second, the rigid rectangular pattern
ignores topography and cuts a way up,
down, or through a hill or an outcropping
of rock, no matter how much less expensive it might be to go around. Third, it
is usually accompanied by requirements
that every street be of a width and carry
a breadth of paving far in excess of the
needs of a single-family residential neighborhood.
A portion of the waste resulting from
blind use of the rectangular street pattern
in residential neighborhoods has been
measured in dollars and cents by the Harvard School of City Planning. 1 The same
200-acre area of land was laid out according to seven different patterns, each providing for 1,300 single-family dwelling units.
The average cost per dwelling for street
improvements ranged from a maximum of
$280.81 under the gridiron pattern to a
minimum of $144.91 in one of the irregular patterns. The gridiron pattern required at least $40.62 per dwelling more
than its nearest competitor. At the same
(time, the gridiron pattern permitted far

less space to be devoted to parks than any
of the other patterns.
To compare the cost of improvements
under the gridiron pattern of street layout
as required by the Borough of Queens in
New York with the cost under a neighborhood-unit plan, Mr. Robert Whitten laid
out an actual 160-acre tract north of Jamaica, New York.2 Developed with the
standard street and block layout but with
no allowance for parks, playgrounds, or
greens, the tract would house 1,177 families. Developed as a neighborhood unit,
it would house 1,241 families and at the
same time permit 17 acres to be devoted to
parks and playgrounds.
Mr. Whitten
showed that under the neighborhood-unit
plan, the cost of street improvements
would amount to $485.09 per lot as compared with $856.31 per lot with the standard layout. The neighborhood-unit plan
effected a saving per lot in cost of street
improvements of $371.22. To a subdivider
of this 160-acre tract this saving would
total $406,115.

1
See Planning for Residential Districts, Vol. I, Reports of
the President's Conference on Home Building and Home
Ownership, pages 85—124.

8
See Regional Survey of New York and Its Environs,
Vol. VII, Neighborhood and Community Planning, pages
338-355.

April 1936




STREETS THAT DESTROY PROPERTY VALUES

the point of view of lending institutions concerned with the safety of their
investments, however, the capacity of the
gridiron-street plan to destroy neighborhoods and consequently residential values
is of greater concern than the waste in
installation. In the gridiron pattern, every
street tends to invite fast through traffic,
FROM

241

which robs the fronting homes of the safety
and quiet essential to conserve the desirability of a residential district. Also, as
has been repeatedly pointed out in this
series of articles, fast automobile traffic
breaks up a neighborhood, cuts one block
off from another. Thus robbed of unity
and identity and the loyalty of its citizens,
the neighborhood must sink helplessly to
lower and lower uses. This phenomenon
is too common in every city to require
proof.
Of course, no planning authority contends that the gridiron pattern is always
the worst pattern. There are situations
and purposes for which it may be the best,
though these will be rare in residential
neighborhoods. The greatest evil in the
rectangular street layout is its almost universal use. It is applied blindly, regardless
of topography, efficiency, attractiveness, or
any other consideration. For the sake of
the safety and investment stability of our
home neighborhoods, we need to break
away from our slavish adherence to any
one pattern and lay out each area on the
basis of an intelligent determination of its
particular requirements.

through driver. This can be done by curving, by breaking the streets, or by installing
circles or other obstructions which compel
the motorist to slow down. Also, openings
into the neighborhood off arterial highways should be kept to a minimum and
should be staggered.
GRIDIRON STREET PATTERN COMPARED WITH
NEIGHBORHOOD-UNIT PATTERN
[Source: Regional Survey of New York and its Environs,
Volume VII]
i

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DCZZlEZZilZZZlEZZICZ:

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jnzjnzjEzutzzjnz
3 CZJ rzD CZZD nzj u/
~~l I

11

1I

A.- LEADING

NOWHERE

1I

7A I

IN PARTICULAR

W H A T SHOULD DETERMINE STREET PATTERN

city, every neighborhood, and every subdivision is different from every
other and needs to be planned differently.
The objectives, however, to be attained by
a street system in a residential neighborhood are always the same. They are: (1)
safety, (2) efficiency, and (3) attractiveness. In these days of the automobile,
safety is the most important. Fast-moving
motor traffic must be kept out of residential districts. Arterial highways are or
should be provided for it. In exchange,
the interior streets of the neighborhood
should be reserved for the residents and
local traffic serving them.
Laws cannot accomplish this exclusion
of fast traffic from inner streets. The only
effective way to accomplish it is to make
the interior streets unattractive to the
EVERY

242




B- LEADING

TO PLACES

WHERE PEOPLE GO

The second factor that should determine
the street layout is efficiency. Streets are
channels of communication between the
home, the school, the store, the community
center, and the transit station. They should
be planned so as to facilitate such communication. To achieve this purpose a comFederal Home Loan Bank

Review

bination of radial and circumferential
streets is generally most satisfactory, as
suggested in the accompanying diagram.
At the same time, efficiency requires that
the streets adjust themselves to the topography. The attempt to run rectangular
streets straight over hills instead of winding the streets around them has increased
the cost and decreased the residential value
of many thousands of lots in this country.
Also, curving streets generally have aesthetic qualities that make them superior to
straight streets.
FACTORS THAT DETERMINE STREET W I D T H
ONCE the interior street plan has been decided upon, the width of the streets must
be determined. No street plan can be satisfactory that is not related to the anticipated uses, densities, and heights of buildings. However, to anticipate that every
neighborhood of single-family homes will
eventually be transformed into apartmenthouse or business districts is patently foolish. Yet, that is what many cities do in requiring uniform widths for all streets. A
60-foot street with 30 feet of paving is
wasteful and destructive where a 30-foot
street with 18 feet of paving would adequately serve a neighborhood of singlefamily homes. If the ultimate use of the
facing lots is not foreseeable but the immediate use is for single-family homes, the
intelligent solution is to require deep setbacks. These will allow for eventual possible broadening while permitting the
street to remain narrow so long as it serves
only single-family homes. Wide streets
and broad pavements are expensive and
invite fast traffic and intensive use of the
facing lots.
The type of dwelling, of course, determines the traffic load. Streets serving
apartment houses must not only carry
more traffic but they must also provide
more space for parking and for light and
air to reach the lower floors of the tall
buildings.

243

April 1936
57475—36



Home-financing
institutions
making
long-term loans on single-family homes
have a vital interest in knowing that the
neighborhood will be restricted to singlefamily homes during the life of the loan.
One of the best ways to insure such restriction is to make streets fit the special requirements of single-family homes from
the beginning.
A satisfactory street pattern is fundamental to stability of neighborhoods and of
home-property values. It can be provided
in any subdivision only by a competent
engineer working within the outlines of a
well-thought-out master plan for the city.
A vast amount of education will be necessary before our cities will adopt flexible
master plans as a matter of course and
before they will require subdividers to employ engineers. Nevertheless, lending institutions will do well to look askance at
investments in new subdivisions in which
the street pattern has not been fitted to the
needs of the dwellings and to the topography.
For existing intown neighborhoods, the
solution of the street problem is, as with
every other problem except transportation,
infinitely more difficult.
Nevertheless,
obedience to the guiding principle of safety
can do much to protect intown neighborhoods even though the inefficient rectangular street pattern must remain. First, the
intelligent planning of arterial highways to
serve as boundaries for the residential
neighborhood will provide for through
traffic and encourage its exclusion from the
interior streets. Second, in connection
with the rehabilitation of deteriorated
neighborhoods, it will be possible in many
instances to provide circular open spaces
or to close an occasional street so as to
make the neighborhood less inviting to
the speeding motorist. Such steps as these
will be difficult of achievement. They will
probably require a completely new attitude
toward housing in the public mind. Hope
lies in the fact that they will be cheaper in
the long run than the present system.

3

Evidences of Recovery in the Savings
and Loan Business

I

N AN attempt to secure an indication
of the extent of recovery achieved by
the savings and loan industry, the REVIEW
has undertaken an investigation of the activities of several associations throughout
the country. The availability of the material has made it possible to present in this
issue a table showing the activity of 21
converted Federal savings and loan associations for the 12-month period prior to
their conversion compared with their activity for the 12 months subsequent to their
conversion. An effort is being made to
prepare a comparable table on the activities of a representative group of Statechartered insured savings and loan associations. It is hoped to complete the series with a study of the comparative activities of State-chartered associations that
are not insured. It will be possible to do
this only if uninsured associations cooperate. Such associations are urgently requested to send to the REVIEW information
on loans made, private investments received, repurchases, total assets, and
changes in interest rates, for the 12-month
period prior to April 1, 1935 and the 12month period following April 1, 1935. As
the spring of last year seems to have been
the turning point for the savings and loan
business, the dividing date of April 1, 1935
is logical.
The 21 Federal associations whose activities are summarized in the accompanying table are situated in 17 States and
every section of the country. Geographically, therefore, they are representative.
However, there can be no question but that
the extraordinary expansion of many of
244




them subsequent to conversion to Federal
charter is much better than the average of
all Federal savings and loan associations.
The first column compares the mortgage loans made for the 12-month period
before and after conversion. The most
effective comment upon this picture is to
compare totals. For the 12 months prior
to conversion, the 21 associations combined made $958,539 worth of mortgage
loans. For the 12 months following conversion, they made $10,103,285 worth of
loans.
The increase in share purchases by private investors following conversion is
equally satisfactory and perhaps even
more encouraging than the increase in
loans made. It is generally recognized that
the loss of public confidence during the depression has been the heaviest cloud on
the building and loan horizon. For the 20
associations for which comparable figures
are available, new investments from private sources prior to conversion totaled
$476,260 as compared with $3,092,697 following conversion.
In many associations repurchases during
the year following conversion were greater
than during the year preceding conversion.
This, of course, is readily explained by the
fact that most of the associations were on
notice before conversion but have been
operating without restriction since conversion. The total repurchases for the two
periods were $1,995,951 before as compared with $3,010,785 after conversion.
In spite of the fact that many of the 21
associations changed from the shareaccount sinking-fund plan to the directFederal Home Loan Bank

Review

Comparative activity of 21 converted Federal savings and loan associations for the 12 months immediately
preceding and the latest 12 months since conversion
Mortgage loans made
State in which association located

1.
2.
3.
4.
5.
6.
7.
8.
9.
10.
11.
12.
13.
14.
15.
16.
17.
18.
19.
20.
21.

12 months
ended Feb.
28, 1936

12 months
prior to
conversion

Texas
Virginia
Iowa
Missouri
Oklahoma
Tennessee
Texas
Arkansas
Washington
New York
Minnesota
Ohio
Georgia
Missouri
Idaho
Massachusetts
California
South Carolina
Ohio
Colorado
Texas
Total

$4, 920
0
56, 800
43, 950
304, 278
11, 675
45, 911
250
31, 711
56, 366
7,150
24, 350
39, 800
5,550
17, 254
2 60, 000
7,400
10, 514
37, 750
23, 531
169, 379

$343, 815
220,102
69, 644
274,175
1, 229, 858
254, 978
153, 470
127, 734
199, 743
1, 884, 592
i 592, 651
619, 010
734, 555
160, 966
303, 317
i 1, 148, 675
215, 846
345, 835
793, 622
129,143
1
301, 554

958, 539

10,103, 285

Private investment
12 months
prior to
conversion

5,264
11, 140
14, 919
16,141
7,971

$73, 210
35, 020
14, 901
62, 998
553, 908
164, 049
78, 876
65, 416
451,158
303, 004
i 59, 446
137, 120
177, 226
25, 349
191, 246
154, 288
26, 900
125, 801
262, 211
48, 822
1
236, 036

476, 260

* 3, 092, 697

$1, 954
4,150
11, 494
18, 672
2,653
112, 261
5,980
10, 620
43, 344
58, 854
1,295
39, 943
74, 815
168
34, 622

(3)

Repurchases
State in which association located

1.
2.
3.
4.
5.
6.
7.
8.
9.
10.
11.
12.
13.
14.
15.
16.
17.
18.
19.
20.
21.

12 months
prior to
conversion

Texas
Virginia
Iowa
Missouri
Oklahoma
Tennessee
Texas
Arkansas
Washington
New York
Minnesota
Ohio
Georgia
Missouri
Idaho
Massachusetts
California
South Carolina
Ohio
Colorado
Texas
Total
1
2

11 months.
Estimated, based on 19 loans.

April 1936




12 months
ended Feb.
28, 1936

12 months
ended Feb.
28, 1936

Government
investments
as of Feb.
28, 1936

$190,
20,
175,
100,
125,
100,
100,
1, 750,
542,
400,
500,
172,
220,
939,
200,
174,
400,
85,

0
000
000
000
000
000
000
000
0
000
500
000
000
000
600
200
000
000
000
000
0

6, 193, 300

Total assets
12 months
prior to
conversion

At time of
conversion

As of Feb.
28, 1936

$60, 674
21, 021
27, 448
46, 914
574, 380
114, 944
10, 517
9,904
181, 479
125, 171
48, 153
51, 316
61, 234
20, 593
113,150
52, 585
27, 173
9,700
85, 997
21, 022
332, 576

$110, 043
27, 838
10, 374
29, 171
1, 684, 144
122, 855
6,841
5,764
255, 887
144, 208
1
77, 916
74, 560
61, 289
24,143
61,110
1
53, 207
13, 219
31, 958
81, 486
9,045
1
125, 727

$1, 691, 249
172, 102
195, 018
333, 638
12, 554, 280
531, 695
230, 318
123, 782
1, 721, 950
1, 163, 069
420, 800
223, 276
415, 319
169,192
270, 615
638, 756
342, 914
24, 760
905, 578
184, 726
1, 912, 986

$1, 368, 843
$1, 304, 702
147, 605
376, 819
250, 516
231, 143
316, 977
573, 469
8, 867, 268
11, 723, 578
785,185
547, 224
396, 840
221, 939
332, 758
94, 174
1, 821, 031
1, 677, 186
3,190, 366
1, 121, 507
1, 057, 591
366, 900
905, 748
223, 228
1,198, 255
420, 891
380, 756
170,937
144, 390 1
555, 794
641,321
1, 814, 461
327, 077
588, 000
425, 554
29,125
834, 688
1, 607, 847
185,801
356,106
1, 853, 649
1,595,649

1, 995, 951

3, 010, 785

24, 226, 023

22, 390,183

3
4

28, 642, 715

Not available.
Does not include figure for association no. 16.

245

reduction loan plan at time of conversion,
with the consequent shrinkage in book
value of assets, total assets as of February
28, 1936 had jumped to $28,642,715 from a
combined total of $22,390,183 at time of
conversion. The total investment of the
Treasury and of the Home Owners' Loan
Corporation in shares of these Federal
associations as of February 28 was
$6,193,300.
The statistical evidences of recovery presented by these 21 associations are striking.
No single explanation will account for
them, but one factor is of such importance
as to deserve special comment. That factor is the service these associations offer
home-owner borrowers—including directreduction loans at long terms and reasonable interest rates. At the time they fed-

246




eralized nearly all the 21 associations made
reductions in the effective interest rates
they had been charging borrowers. One
association listed cut its effective interest rate from 13 percent before conversion
to 6.4 percent after conversion. Another
reduced its effective rate from 13 percent
to 6.2 percent. Other reductions were
from 8.5 percent to 6.2 percent, from 10.5
percent to 6 percent, and from 6 percent
to 5.7 percent. It must be emphasized that
these are effective rates, not nominal rates.
The effective rate includes the nominal
rate plus all service charges and other
charges such as premiums. Only loanclosing fees are excluded. It is obvious
that terms such as these would give savings
and loan associations a competitive advantage in almost any market.

Federal Home Loan Bank

Review

k Uniform Fiscal Year for Savings
and Loan Associations

S

AVINGS and loan associations in different States end their fiscal year and
close their books in at least six different
months. In 28 States and Territories the
fiscal year for associations ends on December 31; in 16 States, on June 30; in one
State each, the closing dates are August
31, September 30, October 31, and November 30. In Pennsylvania, the associations
seem free to close their books and report
at any time they see fit; in Maryland, associations are not required to report.
The mere statement of the facts indicates how impossible it is to make accurate
reports of the savings and loan business,
or to make comparisons between associations in different States. The savings
and loan business as a whole and every
association individually are the principal
victims of this situation. If the business
cannot give the nation an accurate picture
of the service it is rendering, it loses by so
much in public support and it is handicapped by so much in attracting public
savings and home-financing business.
There seems to be no practical reason
why associations in all States cannot adopt
a uniform fiscal year. Only the inertia of
custom stands in the way. Many supervisory authorities and national and State
trade associations have long been working
toward a uniform fiscal year to coincide
with the calendar year. Since associations
in a majority of States now close their
books on December 31, the adoption of this
date in all States would result in the minimum of change.
Uniformity is an element of strength.
Through the cooperative action of the
State supervisory authorities, the United
States Building and Loan League, and the
Federal Home Loan Bank Board, a uniApril 1936




form reporting system has been adopted by
the industry. Uniform accounting practices seem on the way. It is hoped that the
uniform fiscal year will also soon become a
reality.
The dates on which associations now end
their fiscal year are listed below by States:
DECEMBER 31
Idaho
Alabama
Louisiana
Maine
Arizona
Arkansas
Michigan
California
Nebraska
New
Georgia
Hampshire
0re
Indiana
g°n
Iowa
Tennessee
Utah
Kansas
Kentucky
Vermont
West
Minnesota
Virginia
Mississippi
Wyoming
Montana
SEPTEMBER 30
Nevada
New Jersey
Connecticut
New Mexico
NOVEMBER 30
New York
North Carolina
Illinois
North Dakota
OCTOBER 31
Ohio
Oklahoma
Massachusetts
Rhode Island
AUGUST 31
South Carolina
South Dakota
Missouri
Texas
No REPORTS REQUIRED
Virginia
Washington
Maryland
Wisconsin
N o DEFINITE DATE
Hawaii
Pennsylvania—InstiJUNE 30
tutions apparently
Colorado
report at any date
Delaware
during the calendar
District of Columbia year, probably their
Florida
own fiscal year.
247

Steps in the Operation of the
Home-Building Service Plan

I

N PROVIDING a home-building service
to borrowers, a home-financing institution does not duplicate any existing technical facilities. It does not take over the role
of the architect, nor of the builder, nor of
the materials dealer. It does not enter into
the building business. What it does is
something that has never been done before—it marshalls all these hitherto uncoordinated elements of the building industry
into an organized unit and makes itself the
single point of contact between this unit
and the prospective home-owner borrower.
The objective is to make home building for
the borrower almost as simple and safe as
is the purchase of a motorcar or a refrigerator. In so doing, the home-financing institution increases both the safety and the
volume of its own investments and benefits everyone concerned except the jerry
builder.
The Federal Home Loan Bank Board's
recommended procedure for operating a
home-building service and necessary forms,
which together will compose the HomeBuilding Service Guide, are rapidly nearing
completion. The principal steps in operating the service are briefly outlined below.
These steps are, of course, intended merely
as suggestions to associations that may desire to install a home-building service.
They are based largely upon the practical
experience of associations already offering
such a service, but it is recognized that no
one system will fit every association, and
that many will desire to modify the plan
to suit their own needs and practices.
Step 1. The applicant is interviewed at
the lending institution concerning his hous248




ing plans and requirements and also as to
his financial ability to invest the necessary
equity money in the project and to meet
monthly payments.
If the interviewer is doubtful of the applicant's financial ability, he does not unfold the features of the home-building
service at this interview, but either advises
the applicant that it does not seem expedient to undertake the project, or requests
pertinent information and arranges a second interview to permit time to investigate
the credit risk. In this event, Step 4 precedes Steps 2 and 3. If the financial considerations are favorable, however, the interviewer proceeds with the second step at
this first interview.
Step 2. The home-building service and
the economies resulting from its use are
fully explained to the applicant. The cost
of the service, including the drawings,
specifications, and supervision provided by
the local architectural group, are explained.
The interviewer then assists the applicant in the selection of an appropriate design from the portfolio of sketched plans
furnished by the architectural associates.
The aid of the architect in the selection of
the proper design may be advisable. Also,
the client may wish to have the architect
inspect the lot before making a decision to
proceed further.
A client desiring and able to pay for individual plans should, of course, be referred to an architect who will furnish individual service at the usual fees. This reference should be so handled as to retain
the applicant as a borrower.
Federal Home Loan Bank

Review

Step. 3. The interviewer assists the applicant to fill out an application for a mortgage loan and the accompanying credit
statement. In addition, the applicant signs
an agreement for architectural services.
Step i. Eligibility of home owner for
financing is determined.
Step 5. The lot is appraised.
Step 6. The architect inspects the lot and
reports upon the suitability of the selected
design to the site and neighborhood and on
the placing of the house on the lot.
Step 7. The association passes on the loan
application.
Step 8. The mortgage loan having been
approved subject to final arrangements, the
architect furnishes the working drawings
and specifications. In the name of the
owner, the architect secures competitive
bids from not exceeding four qualified
contractors.
Step 9. The architect prepares the construction contract for the owner to sign.
Step 10. The association prepares for the
owner's signature the usual loan documents, including mortgage or deed of trust,
and the construction agreement under
which the association acts as fiscal agent.
Step 11. The architect supervises and inspects the construction, dealing with the
owner as to various phases thereof, and
making inspection reports with certifications of payments due the contractor.
Step 12. The association arranges fire
and other insurance on the building under
construction. It checks the contractor's
compliance with contract requirements as
to liability, insurance, and bond, if any.
On the architect's certification it makes
payments on the contract and payments for
other expenses as set forth in the construction agreement.
Step 13. On completion of construction,
certified by the architect and approved by
the owner, and on waiver or release of
liens, the association makes final payment
to the contractor.
Step Ik. The association accounts to the
owner on its activities as agent.
April 1936




Step 15. It is contemplated that the association will issue a certificate of construction to the owner and a plate to be attached to the house, attesting to construction under appropriate architectural plans
and supervision. The possibility of having such a certificate registered by the
Federal Home Loan Bank Board in order
to give national prestige to construction
under the Board's Home-Building Service
Plan is now being considered.
The procedure outlined would apply
only to dealings with an individual homeowner builder. It would have to be modified, of course, in dealing with operative
builders. A complete set of sample forms
will be included in the Service Guide. The
forms have been adapted from those actually in use in savings and loan associations
which are already operating a home-building service.
PARTICIPANTS IN THE HOME-BUILDING
SERVICE PLAN

be clear from the above outline
of suggested procedure that the homefinancing institution's part in the operation
of a home-building service is that of a
catalytic agent. That is, it brings the
prospective home-owner builder into a
new and more efficient relationship with
the construction industry without undergoing any essential change in its own nature or activities. The participants in the
home-building service plan and what each
does are listed below in outline form.
I. The Federal Home Loan Bank Board.
1. Assists in making arrangements
for adequate technical services.
2. Furnishes Service Guide with complete procedure and forms.
3. Explains the plan to the institution and assists in training institution's personnel.
4. Educates home owners to insist
upon quality standards of construction, and provides sample
promotive material.
IT SHOULD

249

II. The Local Group of Architects.
1. Provides a portfolio of sketch
plans for member institutions to
display to home builders.
2. Provides estimates of construction
cost.
3. Qualifies building contractors.
4. Assures good quality of construction by furnishing an architectural service for the home
builder, including:
a. Six sets of blue prints of
complete standard specifications and working
drawings at 14-inch scale,
with all necessary dimensions, location of all
heating, plumbing and
electrical equipment and
outlets, together with
necessary details.
b. Inspection of the building
site and advice as to suitability of the selected design to the site and neighborhood, and layout of
the house on the site.
c. At least two consultations
with the home builder.
d. On owner-built projects inviting and receiving for
the owner not more than
four proposals from qualified contractors.
e. Preparation of the contract
documents.
f. Checking the layout of the
house on the lot, and inspecting the sub-soil for
footings.
g. At least six inspections of
the work during construction with corrections
ordered where necessary.
Certification of payments
to the contractor and of
satisfactory completion.

250




Where standard plans are used the above
special architectural service usually will
be provided for approximately 2 percent of
construction cost. In some instances discounts will be offered operative builders
who build a number of homes in the same
location simultaneously. In addition to
such minimum service, the architect will be
available for additional consultations and
inspections at a moderate fee (ordinarily
$5 each), and for making minor changes in
standard drawings and specifications at
about cost (ordinarily $2.50 per hour).
Plans for and inspection of reconditioning
or remodeling work will be available at the
usual local fee.
III. The Builder.
1. Provides evidence of his ability to
carry out the construction.
2. Furnishes labor and materials as
specified by the architect.
3. Cooperates with materials men
and sub-contractors.
4. Enables architect to inspect and
test the work.
5. Releases liens on completion.
IV. The Owner.
1. Provides the building site.
2. Provides necessary equity funds.
3. Provides evidence of ability to
carry the project and repay the
loan.
V. The Member Savings and Loan Association.
1. Undertakes local promotional
campaign to attract the public
(investors and borrowers) to its
place of business.
2. Provides space and personnel to
contact the home-builder applicant.
3. Makes loans to home builders.
4. Makes payments during construction on certificate of the architect and performs other duties
as fiscal agent.

Federal Home Loan Bank

Review

Indexes of Small-House Building Costs

T

HE April costs of building the same
typical 6-room house in the group of
cities which first reported in January are
published in the accompanying table. Comparison with the revised figures for January gives a preliminary indication of the
movement of costs in each city. As the
Board's major purpose in developing the
indexes is to show trends in costs within
each reporting city, these preliminary
comparisons are of special interest.
Attention is called to the revisions in the
preliminary January cost figures which
were published in the January REVIEW.
The greatest change is that for Providence,
Rhode Island, for which the revised January figure is $5,584 instead of the preliminary figure of $6,442. As a result of
this revision, the cost of building the
standard house in Providence is shown to
be well below the January high for the
New England district. This high was
$5,803 reported by Boston.
At the other end of the scale, revisions
of the January cost figures seem to stamp
Baltimore as the city of lowest costs instead of Columbia, South Carolina. The
revised January figures for Baltimore
show a cost of $4,453 instead of the preliminary figure of $5,028, published in the
January REVIEW. The low costs reported
by Baltimore are explained by the low
hourly wage rates at present being paid in
that city and by the competitively low
prices for building materials. The fact
that residential construction in Maryland
has for some time been lower than in any
other State in the fourth Federal Home
Loan Bank District (see table, page 256)
may also help to explain the low costs in
Baltimore.
As was foreseen and pointed out in the
initial articles on the building-cost indexes,
the revised figures show some changes
from the preliminary figures published in
January for every city. The inevitable
April 1936




complexity of the reporting system and the
difficulties of defining exactly the quality
of materials on which prices are asked can
only be overcome by time and intensive
instruction. Although these preliminary
figures still remain subject to correction,
the major errors have been eliminated and
the third report from this group of cities
due in July will make possible the publication of definitive January and April figures. Meanwhile, we again repeat that it
will be desirable to delay until July the
drawing of final conclusions and the making of definitive comparisons between costs
reported from these cities.
APRIL COSTS

now to the preliminary cost figures for April from the various cities, we
find that Baltimore retains the low position
with $4,486 or a cubic-foot cost of 18.7
cents for the typical house. The highest
cost of $6,537 or 27.2 cents per cubic foot
is reported by Chicago.
In comparing movements in costs from
January to April, it will be seen that there
is absolutely no uniformity either in direction or volume. Twelve cities showed
some upward movement, nine showed a
decrease, and in two cities costs remained
practically stationary between the two
periods. This complete absence of uniformity in cost trends as well as the wide
differences in total costs among cities bears
out the contention frequently expressed
that the building industry in each community is almost wholly uninfluenced by the
situation of the industry in any other
community.
In an attempt to give as wide a geographical distribution of different cost
areas as possible, the REVIEW has dropped
some of the cities from which reports were
asked in January and added certain new
cities.
TURNING

251

Total costs and cubic-foot costs of building the same standard house in representative cities in January
and April 1936
NOTE.—It must be understood that these figures are subject to correction. No conclusions should be drawn until the reporting system has had
time to be perfected and possible errors largely eliminated.
These figures do not represent the cost of a completed house, but only the cost of the basic elements that go into a house.
[Source: Federal Home Loan Bank Board]

Total building cost

Cubic-foot cost

Federal Home Loan Bank Districts, States, and cities
April
No. 1—Boston:
Connecticut:
Hartford
New Haven
Maine:
Portland
Massachusetts:
Boston
New Bedford
Worcester
New Hampshire:
Rhode Island:
Providence
Vermont:
District average
No. 4—Winston-Salem:
Alabama:
Birmingham
District of Columbia:
Washington
Maryland:

i

1

January

April

January

$5, 697
5,589

$5, 791

$0. 237
.233

$0. 241

5, 080

5,042

.212

.210

5, 833
5, 426
5, 667

5, 803

.243
.226
.236

.242

5, 432

5, 467

.226

.228

5,545

5, 584

.231

x233

5, 345
$5, 513

5,348
$5, 506

.223
$0. 230

.223
$0. 229

5,268

5,233

.220

.218

4,961

4,937

.207

.206

4,486
5,701

4,453
5,600

.187
.238

.186
.233

5,304
5,963

6,074

.221
.248

.253

5,476

5,230

.228

.218

4,716
4,804

4,733
5,016

.196
.200

. 197
.209

4,634

4,489

.193

. 187

5,143
4, 556
$5, 084

5,193
4,507
$5, 042

.214
.190
$0. 212

.216
.188
$0. 210

6,537
6,154
6,443

6,357

.272
.256
.268

.265

Florida:
West Palm Beach
Georgia:

Atlanta

North Carolina:
Asheville
Raleigh
South Carolina:
Columbia
Virginia:
Richmond
District average
No. 7—Chicago:
Illinois:
Chicago
Peoria
Springfield
Wisconsin:
Milwaukee
District average
No. 10—Topeka:
Colorado:
Denver
Kansas:
Wichita
Nebraska:
Omaha
Oklahoma:
Oklahoma City
District average

252




5,560
5,381
$6, 015

6,438

5, iii
$5, 970

6,023

.232
.224
$0. 251

268
.213
$0. 249

.251

5,183

5,428

.216

226

5, 552

5, 588

.231

233

5,501
$5, 565

5,462
$5, 493

.229
$0. 232

228
$0. 229

Federal Home Loan Bank

Review

Residential Construction Activity in
the United States

T

HOUGH the severe February weather
took its toll of building activity, the
number and cost of dwelling units authorized by permits in all cities of 10,000 and
more population fell but slightly from the
January level (chart 1). Permits authorized during the month provided for 6,943
dwelling units costing nearly $30,000,000.
Compared with the same month of last
year, these figures represent increases of
119 percent and 189 percent respectively
(table 1). The relatively greater rise in
costs is, of course, due to the construction
of more expensive homes, and not to a rise
in building costs.

One- and two-family type dwellings accounted for 64.3 percent of all units authorized during the month while units in 3- or
more-family structures accounted for the
remaining 35.7 percent. The proportions
for the two types in February 1935 were
68.4 percent and 31.6 percent respectively.
The average cost of all units was considerably higher in February 1936 than in February 1935. One-family dwellings averaged $5,033 as compared with $3,477 a year
ago and the cost of units in multifamily
structures rose from $2,980 last year to
$3,270 this February.

CHART I.—NUMBER AND COST OF FAMILY DWELLING UNITS FOR WHICH PERMITS WERE GRANTED. BY MONTHS
Cities of 10,000 or more population: 1936 compared with selected periods
[Source: Federal Home Loan Bank Board. Compiled from reports to U. S. Department of Labor]

NUMBER OF UNITS

PROVIDED

COST

40.000

IK

OF UNITS PROVIDED

40,000

1936

I

<0

1\

I 933
1931?

li

\

• »

o
6

1

/

1

y
\
\

r

<0

^
30,000

20.000

20,000

o
z

<

o»
©

I 932- 34

191t£z3* f AYfc

4

' / ——*
^

•-

'"-. ^

I!

.+'*

,,'
v.

<

10.000

\

k

•'

\

x

•

^

.

AVG.

3J

>

\\
\

10,000

ft

April 1936




253

CHART 2 . — R A T E

OF R E S I D E N T I A L B U I L D I N G

I N T H E U N I T E D STATES A N D I N EACH

FEDERAL

HOME LOAN BANK DISTRICT BY MONTHS
Represents the estimated number of family dwelling units provided per 100,000 population; based upon buildingpermit records for all cities of 10,000 or more inhabitants
[Source: Federal Home Loan Bank Board. Compiled from reports to U. S. Department of Labor]
- L E G E N D 1935
193$
U S . AVERAGE 1936
DISTRICT

I-BOSTON

DISTRICT 2 - N E W

— mmam
,
YORK

DISTRICT

3-PITTSBURGH

30

30

20

20

40

H

,0

10

J

gj ^^ii^
J F M A M J J A S O N D

DISTRICT 4 - W I N S T O N SALEM

J F M A M J J A S O N D

J F M A M J J A S O N D
DISTRICT

5-CINCINNATI

DISTRICT

6-INDIANAPOLIS

EDSi
30

130

r'

ru-^i
^-1935 LI

20

UT

r

20

<0
K

5*
10

10

P
J F M A M J
DISTRICT

^1935
J A S 0 ND
7-CHICAGO

H

J F M A M J J A S O N D
DISTRICT 8 - P E S MOINES

g^

V^I935LJ

J F M A M J J A S O N D
DISTRICT

9-LITTLE

ROCK
30

30
1936
20

20

10

J F M A M J J A S O N D
DISTRICT

I0-T0PEKA

J F M A M J J A S O N D
DISTRICT 1 1 - P O R T L A N D

J F M A M J J A S O N D
DISTRICT 1 2 - L O S ANGELES

30

30

1935

tn
i- 2 0

10




20

10

J F M A M J J A S O N D

254

~

J F M A M J J A S O N D

J F M A M J J A S O N D

Federal Home Loan Bank Review

BUILDING ACTIVITY BY FEDERAL HOME LOAN
BANK DISTRICTS

T H E rate of residential construction which
prevailed in all cities of 10,000 and more
population during the first two months of
1936 and all of 1935 is shown for the United
States and for each Federal Home Loan
Bank District in chart 2. The total number
and cost of units by Districts and by States
is shown in table 2. As the chart for each
District is comparable with every other
chart, member institutions may compare
the rate of building in their Districts not
only with activity in the preceding year but
with the rate in any other District.
Chart 2 shows great unevenness both in
the rate of building activity in February
and in the change from January in different Districts. Nine Districts registered
some drop from January while only the
Winston-Salem and Chicago Districts
showed an increase and Topeka remained
stationary. Nevertheless, every District
except Des Moines remained above the
February 1935 level.
Eight Districts
showed a lower rate of construction than
the United States as a whole, only Los
Angeles, Winston-Salem, Little Rock, and
Chicago exceeding the national rate.
TABLE

The extraordinary increase in the Chicago District was due wholly to 1,291
dwelling units authorized by permits in
Wisconsin. A Federal resettlement project
being undertaken in Milwaukee was
mainly responsible for this volume.
BUILDING COSTS AND HOUSING RENTALS

T H E cost of building declined slightly during February, according to the index computed by the Federal Reserve Bank of New
York. The index stood at 89.0 percent of
the 1923-1925 base level as compared with
89.1 percent in January and 88.5 percent
in February 1935. Housing rentals as
measured by the National Industrial Conference Board index continued their steady
upward trend, standing in February at 71.&
percent of the 1923-1925 base as compared
with 71.4 percent in January and the low
point of 60.6 percent in January 1934.
Industrial production, in sharp contrast
with the low level of residential construction, was almost back to its 1923-1925 level
in February. In that month it stood at 97
percent, having risen from 96 percent in
January and 91 percent in February 1935.

1.—Number and estimated cost of new housekeeping dwelling units for which permits
were issued
in all cities of 10,000 population or over in the United States in February 1936l
[Source: Federal Home Loan Bank Board.

Compiled from reports to U. S. Department of Labor]

Number of family units
provided

Total cost of units
(000 omitted)

Average cost of family
units

Type of structure

All housekeeping dwellings..
Total 1- and 2-family dwellings
1-family dwellings
2-family dwellings
Joint home and business 2 . . .

Feb.
1936

Feb.
1935

3,171 + 119.0 $29, 885.4 $10, 345. 5 + 188.9

$4, 304

$3, 263

+31. 9'

7, 360. 0 + 195.9
6, 769.4 +211. 9
498.1 +22.6
92.5 - 4 0 . 0
2, 985. 5 + 171.6

4,879
5,033
2,463
2,643
3,270

3,393
3,477
2,516
3,854
2,980

+43. a

Feb.
1936

Feb.
1935

6,943
4,464
4,195
248
21
2,479

2,169 + 105.8
1,947 + 115.5
198 +25.3
24 - 1 2 . 5
1,002 + 147.4

Percent
change

Feb.
1936

21, 777.9
21, 111. 7
610.7
55.5
8,107. 5

Feb.
1935

Percent
change

Percent
change

+44.8
—2.1
-31.4
+9.7

1
Estimate is based on reports from communities having approximately 95 percent of the population of all cities with,
population
of 10,000 or over.
2
Includes 1- and 2-family dwellings with business property attached.

April 1936




255

2.—Number and estimated cost of new residential buildings for which permits were issued in all
cities of 10,000 population or over, in February 1936, by Federal Home Loan Bank Districts and by
States

TABLE

[Source: Federal Home Loan Bank Board.

Compiled from reports to U. S. Department of Labor]

All residential dwellings
Federal Home Loan Bank
Districts and States

Number of family
dwelling units

All 1- and 2-family dwellings

Estimated cost
(000 omitted)

Number of family
dwelling units

Estimated cost
(000 omitted)

Feb.1936 Feb.1935 Feb. 1936 Feb.1935 Feb.1936 Feb. 1935 Feb. 1936 Feb.1935
UNITED STATES

No. 1—Boston

6,943

3,171 $29, 885. 4 $10,345.5

4, 464

2,169 $21, 777. 9

$7, 360. 0

117

71

625.2

304.5

110

59

603. 3

269 5

40
8
55
2
12

18
5
34
1
11
2

211.8
15.5
348.2
9.0
40.7

78.6
14.0
156.9
3.7
47.9
3.4

37
8
51
2
12

18
5
22
1
11
2

201.0
15.5
337.1
9.0
40.7

78
14
121
3
47
3

1,330

973

4, 868. 5

3, 436. 8

365"

268

1, 658. 7

64
1,266

67
906

442.7
4, 425. 8

335.9
3,100. 9

64
301

54
214

442.7 |
1, 216. 0

315 9
807 9

No. 3—Pittsburgh

134

72

588.0

411.7

111

62

560.5

408 1

Pennsylvania
West Virginia

88
46

1
43
28

476.9
111.1

17.0
339.5
55.2

88
23

1
43
18

476.9
83.6

17 0
339 5
51 6

1,356

518

4, 627. 8

1, 425. 3

646

392

2, 605. 2

1,128. 5

33
511
451
45
31
64
62
159

18
120
122
55
5
126
34
38

79.8
1, 598. 6
1, 573. 6
129.4
133.0
216.4
144.5
752.5

28.0
492.6
281.1
114.6
21.5
309.0
64.9
113.6

19
86
201
39
27
64
54
156

18
67
119
55
5
62
28
38

32.2
616.1
632.8
116.1
123.0
216.4
124.5
744.1

28 0
389.1
278 2
114 6
21 5
125 4
58 1
113.6

No. 5—Cincinnati

149

115

808.7

516.9

133

111

748.7

476.0

Kentucky
Ohio
Tennessee

10
93
46

24
60
31

44.0
632.0
132.7

84.7
372.9
59.3

10
77
46

24
56
31

44.0
572.0
132.7

52 8
363.9
59.3

No. 6—Indianapolis

105

76

677.0

410.3

105

69

677.0

398.1

9
96

19
57

51.2
625.8

343.9

9
96

12
57

51.2
625.8

54 2
343.9

1,322

42

9, 698. 9

239.4

804

39

7, 460. 4

215 4

31
1,291

19
23

276.8
9, 422.1

116.9
122.5

31
773

16
23

276.8
7,183. 6

92.9
122.5

95

177

408.2

558. 8

95

158

408.2

522.4

1
9
82
1
2

10
38
83
20
26

3.5
67.3
330.9
2.0
4.5

11.9
120.7
361.2
34.0
31.0

1
9
82
1
2

10
38
83
2
25

3.5
67.3
330.9
2.0
4.5

11.9
120.7
361.2
2.0
26 6

Connecticut
Maine
Massachusetts
New Hampshire
Rhode Island
Vermont
No. 2—New York
New Jersey
New York

No. 4—Winston-Salem
Alabama
Florida
Maryland
North Carolina

Indiana
Michigan
N o . 7—Chicago
Illinois
Wisconsin
N o . 8—Des Moines
Iowa
Minnesota
Missouri
North Dakota
South Dakota

256




66.4 1

6
0
9
7
9
4

1,123 8

Federal Home Loan Bank Review

2.—Number and estimated cost of new residential buildings for which permits were issued in all
cities of 10,000 population or over, in February 1936, by Federal Home Loan Bank Districts and by
States—Continued

TABLE

[Source: Federal Home Loan Bank Board . Compiled from reports to U. S. Department of Labor]

All residential dwellings
Federal Home Loan Bank
Districts and States

Number of family
dwelling units

All 1- and 2-family dwellings

Estimated cost
(000 omitted)

Number of family
dwelling units

Estimated cost
(000 omitted)

Feb. 1936! Feb.1935 Feb. 1936 Feb.1935 Feb.1936 Feb. 1935 Feb. 1936! Feb. 1935
695

No. 9—Little Rock

423

$1, 808. 8

$760. 4 '

659

385

$1, 732. 7

$729. 0

8.4
82.1
12.3
5.0
652.6

20
64
12
21
542

6
41
10
2
326

45.8
211.4
44.6
67.0
1, 363. 9

8.4
82.1
12.3
5.0
621.2

Arkansas
Louisiana
Mississippi
New Mexico
Texas

20
64
12
21
578

6
41
10
2
364

45.8
211.4
44.6
67.0
1, 440. 0

No. 10—Topeka

185

126

652.8

418.0

158

123

588.8

407 0

53
38

235.3
129.1

94

34
29
6
54

181.3
119.1

288.4

154.8
79.9
35.4
147.9

34
30

94

37
29
6
54

288.4

143
79
35
147

118

108

382.7

245.8

114

94

375.7

224 3

2
4
41
5
64
2

4
10
15
6
57
16

5.8
10.0
135.1
9.4
212.6
9.8

6.1
29.7
46.2
11.8
115.2
36.8

2
4
37
5
64
2

4
10
15
6
49 i
10

5.8
10.0
128.1
9.4
212.6
9.8

6 1
29 7
46 2
11 8
106. 4
24 1

1, 337

470

4, 738. 8

1,617.<T

1,164

409

4,358.7

1, 457. 9

30
1, 290 1
17

1
468
1

93.7
4,566.1
79.0

9.5
1, 605.1
3.0

22
1,125
17

1
407
1

78.7
4,201.0
79.0

9 5
1, 445 4
3 0

Colorado
Kansas
Nebraska
Oklahoma
No. 11—Portland
Idaho
Montana
Oregon
Utah
Washington
Wyoming
No. 12—Los Angeles
Arizona
California
Nevada

1

8
9
4
9

1

April 1936



257

Growth and Lending Operations of the
Federal Home Loan Banks

T

HE volume of Federal Home Loan
Bank loans outstanding to member
institutions continued to hold up beyond
expectations throughout February. With
total advances of $3,784,000 during the
month and repayments of $3,642,000, the
net balance outstanding increased to $102,942,000. There seems no doubt that the
return of weather favorable to building
will inaugurate the heaviest demand for
Federal Home Loan Bank credit in the
System's history.
In this connection, it will be noted that
table 1 includes a new column showing

that member institutions have a current borrowing capacity of approximately
$875,000,000. This column replaces the
formerly published line-of-credit column,
based on 12-times stock subscriptions. This
was shown by experience to have no
validity, in view of the ease with which
stock subscriptions may be increased to
meet a larger need for Bank credit.
The true picture of the potential borrowing capacity of a member institution
is not given by computations figured on
its actual stock holdings; it must be ob-

Growth and trend of lending operations of the Federal Home Loan Banks
Members
Month
Number

Assets*
(000
omitted)

Loans
advanced
(cumulative)
(000
omitted)

Loans
advanced
(monthly)
(000
omitted)

Repayments
(monthly)
(000
omitted)

Balance outstanding at Borrowingend of
capacity
month
(000
(000
omitted)
omitted)

1932
December

118

$216, 613

$837

$837

1933
June
December

1,337
2,086

1, 846, 775
2, 607, 307

48, 817
90, 835

8,825
7,102

$270
859

47, 600
85, 442

1934
June
December

2,579
3,072

3, 027, 999
3, 305,088

111, 767
129, 545

2,950
2,904

3,143
3,360

85,148
86, 658

1935
June
December

3,326
3,468

3, 201, 671
3,131, 019

148,450
188, 675

5,353
8,414

1,957
2,708

79, 233
102, 795

3,501
3,527

3,160, 048
3,193, 280

193, 746
197, 530

5,017
3,784

5,065
3,642

102, 800
102, 942

January
February

1936

$837

$875, 000

1
Where declines occur they are due to adjustments based on current reDorts from State building and loan commissioners. In this connection it should be stated that assets of member institutions are reported when they join the System
and are subsequently brought up to date once a year as periodic reports are received either from the institutions or from
State building and loan supervisors.
NOTE.—All figures, except loans advanced (monthly) and repayments, are as of the end of month.

258




Federal Home Loan Bank

Review

tained by computations based upon its potential stock holdings and borrowing capacity as fixed by the State or Federal
charter under which it operates. By such
computations it is found that member institutions in February had a borrowing
capacity of approximately $875,000,000.
The more their assets increase, of course,

the more they will be able to borrow from
the Federal Home Loan Banks.
During February the number of members of the Federal Home Loan Bank System was increased by 26 bringing the total
membership to 3,527. At the end of the
month the combined assets of these institutions were approximately $3,193,000,000.

Interest rates, Federal Home Loan Banks: rates on advances to member institutionsx
Federal Home Loan
^ Bank

1 Boston
7! New York

3.

4 . Winston-Salem
5 Cincinnati
6.
7 Chicago
8. Des Moines

9.
10 Topeka
11 Portland

12.

Rate in
effect on
April 1

Type of loan

Percent
All advances.
3
3% All advances for 1 year or less.
All advances for more than 1 year shall be written at 4 percent, but interest collected at 3% percent during 1936. This rate shall be applicable to balances
outstanding on Jan. 1, 1936.
3% All advances for 1 year or less. All advances for more than 1 year are to be written
at 4 percent, but until further notice credit will be given on all outstanding
advances for the difference between the written rates of 5, 4)4, or 4 percent and
3)4 percentum per annum.
3)4 All advances for 1 year or less. All advances for more than 1 year are written at
4)4 percent, but interest collected at 3 ^-percent rate until further notice.
3
All advances.
All secured advances for 1 year or less.
3
3)4 All unsecured advances, none of which may be made for more than 6 months.
3)4 All secured advances for more than 1 year.
All secured advances are to be written at 3)4 percent, but interest collected at 3
3
percent.
All unsecured advances.
3)4 All advances for 1 year or less.
All advances for more than 1 year shall bear an interest rate of 3)4 percent for the
3)4-4
first year, and 4 percent for subsequent years, but interest will be collected at
3)4 percent so long as this rate is in effect on short-term advances.
All advances.
3
Do.
3
All advances to members secured by mortgages insured under Title II of National
3
Housing Act.
3)4 All advances for 1 year or less. All advances for more than 1 year to be written
at 4 percent, but interest collected at 3)4 percent so long as short-term advances
carry this rate.
All advances.
3

1
On May 29, 1935, the Board passed a resolution to the effect that all advances to nonmember institutions upon the
security of insured mortgages, insured under Title II of the National Housing Act, "shall bear interest at rates of interest
one half of 1 percentum in excess of the current rates of interest prevailing for member institutions."

April 1936




259

FEDERAL HOME
Combined statement of
New York

Pittsburgh

Combined

Boston

$3, 556.13
6, 549, 832. 53

$500. 00
140, 720. 32

0
$1, 645, 084. 96

$1, 000. 00
32, 876. 61

1, 374, 490. 29
2, 500, 000. 00
2, 526,199. 25

0
0
907, 794.91

0
0
155, 760. 27

0
0
41, 603. 29

12, 954, 078. 20

1, 049, 015. 23

1, 800, 845. 23

75, 479. 90

102, 887, 360. 01
51, 000. 00
3, 880. 61

3,189, 487. 61
0
0

15, 210, 295. 21
0
0

11, 691, 760. 36
51, 000. 00
0

102, 942, 240. 62

3,189, 487. 61

15, 210, 295. 21

11, 742, 760. 36

422, 942.16
4, 967. 21
133,177. 33
248.93

13,718. 71
0
22, 579. 43
0

61, 707. 51
0
1, 367. 32
0

53, 406. 42
0
1, 999. 69
167. 68

Winston-Salem

ASSETS

Cash:
On hand
On deposit with U. S. Treasurer, members' demand
On deposit with other Federal Home Loan Banks...
On deposit with commercial banks
Loans outstanding:
Other

Accrued interest receivable:
Other Federal Home Loan Banks, deposits
Other

Investments, U. S. Government
Furniture and fixtures (net)
Stock subscriptions receivahl«, m«mbp"rK
Deferred charges:
Prepaid assessment, F. H. L. B. B
Other

.*

Other assets:
Accounts receivable
Other

$10.00
1,065,450.67

o
10,956.72 1
1,076,417.39
7,280,287.14

o
0
7,280,287.14 |
34,500.23

o

9,008.58
0
43,508.81

561, 335. 63

36, 298.14

63, 074. 83

55, 573. 79

18,^557364. 86
2.00
323, 365. 00

4, 350, 000. 00
0
56, 600. 00

205, 985.94
0
31, 900. 00

142, 900. 00
1.00
18, 025. 00

1, 481, 467. 51

6, 357.50
12, 492.94
3, 095. 86

1, 657. 50
1, 058.15
0

0
1, 592. 44
2, 075. 03

0
1,129. 78
0

21, 946. 30

2, 715. 65

3,667. 47

1,129. 78

1,807.50
652.50
0
2,460.00

3, 421. 88
734.17

0
0

0
0

1, 726. 08
0

953.49
0

4,156. 05

0

0

1, 726. 08

21,575.00

953.49
9,906,669.34 |

135,^462, 488.66

8, 684,116. 63

17, 315, 768. 68

12, 037, 595. 91

5, 419, 713. 84
1, 574, 490.29
200, 874. 87
2, 500,000. 00
121,130. 50

1,137, 363. 06
0
5, 975. 00
0
0

924, 000. 00
0
21,199. 87
0
0

72, 000. 00
0
23, 725. 00
200, 000. 00
30, 255. 00

7,424. 62
4, 316. 58

1, 501.10
0

1, 794. 61
0

96.76
471. 23

0
598.08
0

9, 827, 950.70

1,144, 839.16

946,994. 48

326, 547. 99

210,723.08

LIABILITIES AND CAPITAL

Liabilities:
Deposits:
Members, demand
Other Federal Home Loan Banks
Members' loan prepayments
Accrued interest:
Members' deposits
Accounts payable
Capital:
Capital stock, issued and outstanding:
Fully paid:
U. S. Government:
Subscriptions, authorized
Subscriptions, uncalled
Partially paid:
Total capital stock outstanding
Surplus:
Reserves:
As required under section no. 16 of act
Surplus, nnallocated
x
Total surplus

260




205,500.00

o
4,625.00

24, 576, 900. 00

2, 033, 500. 00

3, 405, 600. 00

1, 782, 500. 00

2, 012, 200.00

124, 741,000.00
27, 045,300.00

12,467,500. 00
7,167, 500. 00

18, 963,200. 00
6, 463, 200. 00

11,146, 300. 00
1, 546, 300. 00

9, 208, 200. 00
1, 708, 200. 00

97, 695, 700. 00

5, 300, 000. 00

12, 500, 000. 00

9, 600, 000. 00

7,500,000.00

626, 900. 00

96f 700. 00

67, 900. 00

48, 600. 00

40,500.00

122, 899, 500. 00

7, 430, 200. 00

15, 973, 500. 00

11, 431,100. 00

9,552,700.00

1, 389, 307. 61
1, 345, 730. 35

67, 843. 94
41, 233. 53

194, 400. 20
200, 874. 00

146, 609. 47
133, 338. 45

100,015.02
43,231.24

2, 735, 037. 96

109, 077. 47

395, 274. 20

279, 947. 92

143, 246 26

125, 634. 537. 96

7, 539, 277. 47

16, 368, 774. 20

11, 711, 047. 92

9,695,946.26

135,462, 488. 66

8, 684,116. 63

17, 315, 768. 68

12, 037,595. 91

9,906,669.34

Federal Home Loan Bank

Review

LOAN BANKS
condition as at Feb. 29, 1936
Cincinnati

Indianapolis

0
$384, 219.99

$951.13 1
367,582.41

698, 035.10
283, 245. 21

92,118. 09
900, 000.00
415, 540. 31

1, 356, 685. 57
18, 338, 412. 79

$25. 00
396,981.97

0
$1,094, 012.99

$510. 00
447,119. 06

0
550, 213. 47

0
0
13,459.15

163, 091. 92
0
0

25,457.77
0
9, 312. 09

158, 217. 59
1, 600, 000. 00
57, 000. 00

237, 569. 82
0
81, 313. 83

1, 791, 878. 39

918, 747. 01

345, 216. 67

432, 272. 69

431,776. 83

2, 909, 230.58

766, 512. 71

0

4, 529, 203.13
0
0

17, 663, 804. 89
0
0

5, 577, 968.19
0
0

7, 449, 980. 63
0
0

5, 019, 594. 97
0
0

2, 796, 306.97
0
0

4,140,258.12
0
3, 880.61

18, 338, 412. 79

4, 529,203.13

17, 663, 804. 89

5, 577, 968. 19

7, 449, 980. 63

5, 019, 594. 97

2, 796, 306. 97

4,144,138. 73

52, 764. 87

24, 752. 09
1, 655. 74
12, 469. 02
81.25

73, 233. 67
0
1,165. 24
0

31, 858. 87
0
15, 714. 20
0

24, 861.15
0
31, 756. 57
0

22, 799. 71
0
2, 791. 67
0

10, 017. 27
3, 311. 47
4, 279. 97
0

19, 321. 66
0
6, 722. 73
0

38, 958.10

74, 398.91

47, 573. 07

56, 617. 72

25, 591. 38

17, 608. 71

26, 044. 39

156, 611.18
0
22, 275. 00

1, 985, 333. 57
0
1, 475. 00

2, 416, 725.00
1.00
5, 550. 00

l7050, 000.1)0
0
11, 275. 00

710, 075. 00
0
3, 490. 00

1,137, 957. 81
0
30,175. 00

1, 327. 00
1, 020. 83

0
920. 84
0

2, 892. 50
406.93
0

0
934.16
0

0
1, 346.13
0

0
1, 038. 98
0

0
975. 01
0

0
1, 111. 02
0

2, 347. 83

920. 84

3, 299. 43

934.16

1, 346.13

1, 038. 98

975. 01

1, 111. 02

189. 78

0
0

0
734.17

36.25
0

0
0

0
0

516. 28
0

o

1

1

1

o 1

1, 987, 032. 87
0
10, 075. 00

110, 950. 00

1

Los Angeles

Portland

$25. 00
269,155. 77

3, 031,27579tT

1

Topeka

$25. 00
331, 732. 52

23, 322. 91
0
76, 087. 78

1

Little Rock

Des Moines

$510.00
374,895.26

o

1

Chicago

189.78

0

734.17

0
0
0

36.25

0

0

516.28

22, 915, 949. 73

8, 358, 068. 33

18, 839, 870. 59

7, 958. 500. 66

10, 362, 529. 42

6, 539, 277.16

6, 437, 686. 27

6,106, 455.94

685, 000. 00
898, 035.10
37, 350. 00
2, 300, 000. 00
90, 875. 50

22, 259. 31
92,118. 09
24, 400. 00
0
0

2,198, 591. 47
0
32, 775. 00
0
0

175,000.00
0
5, 825. 00
0
0

0
163, 091. 92
1,125. 00
0
0

0
25, 457. 77
3, 300. 00
0
0

0
158, 217. 59
250. 00
0
0

0
237, 569. 82
40, 325. 00
0
0

31. 69

°

°
4, Oil, 292. 29

0
0

3, 230. 26
1,175. 00

172.12
0

0
0

0
0

0
0

0
2, 670. 35

138, 777. 40

2, 235, 771. 73

180, 997.12

164,216. 92

28,757. 77

158, 467.59

280, 565.17

5, 346,500. 00

2, 004, 500. 00

2, 668, 400. 00

1,139, 900. 00

1, 382, 800. 00

1, 056, 700. 00

540, 700. 00

1, 203, 600.00

12, 775, 700. 00

6, 577, 400. 00
577, 400. 00

14,173, 900. 00
673, 900. 00

7, 394, 900. 00
894, 900. 00

8, 772, 400. 00
172, 400. 00

5, 960, 000. 00
300, 000. 00

9,967,900.00
5, 507, 900.00

12, 775, 700. 00

6, 000, 000. 00

13, 500, 000. 00

6, 500, 000. 00

8, 600, 000. 00

7, 333,600. 00
2, 033, 600. 00
5, 300, 000. 00

5, 660,000. 00

4,460,000. 00

13, 800. 00

21, 700. 00

6, 200. 00

44, 600. 00
5, 708, 200.00

44, 318. 52
73, 372. 25

°

226, 700. 00 1

17, 600. 00

38, 600. 00

4, 000. 00

|

18, 348, 900. 00 1

8, 022,100. 00

16, 207, 000. 00

7, 643, 900. 00

9, 996, 600. 00

6, 378, 400. 00

6, 206, 900. 00

1

277, 528. 27
278,229.17 J

108, 966. 28
88, 224. 65

191, 361. 62
205, 737. 24

69, 305. 97
64,297. 57

102,362.17
99,350. 33

49,250.17
82, 869. 22

37, 345. 98
34, 972. 70

1

72, 318. 68 j

117, 690. 77

555, 757. 44 1

197,190. 93

397, 098. 86

133, 603. 54

201, 712. 50

132,119. 39

1 18, 904, 657. 44 |

8, 219, 290.93

16, 604, 098. 86

7, 777, 503. 54

10,198, 312. 50

6, 510, 519. 39

6, 279,218. 68

5,825,890.77

1 22, 915, 949. 73 1

8, 358, 068. 33

18, 839, 870. 59

7, 958, 500. 66

10, 362, 529. 42

6, 539, 277.16

6, 437, 686. 27

6,106, 455.94

April 1936




261

Federal Savings and Loan System

T

HE 383 converted Federal savings and
loan associations making comparable
reports for January and February registered a net increase in private share investments of $6,283,114 during February (table
1). This is by far the largest increase reported by converted associations in any one
month to date. These 383 associations obtained an additional $1,554,000 in share
subscriptions from the Home Owners' Loan
Corporation and an additional $438,414 in
advances from the Federal Home Loan
TABLE

Banks. As a result of these added resources, the associations were able to expand their combined balance of loans
outstanding at the end of the month by
$3,367,511, a net increase of 1.3 percent.
Together, the 515 new and 383 converted
Federal associations reporting made during February mortgage loans totaling
$8,981,959. This was only $220,629 less than
their January total. Refinancing, with 41
percent of the total, led the list of purposes
for which loans were made; new construc-

1.—Federal Savings and Loan System—Combined summary of operations for February 1936
as compared with January 1936 for associations reporting in both months
515 new associations

February

Share liability at end of month:
Private share accounts (number)..
Treasury and H. 0. L. G. subscriptions
Total
Average paid on private subscriptions..
Repurchases during month
Mortgage loans made during month:
a. Reconditioning
b. New construction
c. Refinancing
d. Purchase of homes
Total for month
Loans outstanding end of month *
Borrowed money as of end of month:
From Federal Home Loan Banks..
From other sources
Total
1

78, 928

January

78, 865

$31, 059,185 $29, 895,143

383 converted associations

Change
January
to February
Percent
0

February

401, 358

January

401,608

Change
January
to February
Percent

0

+ 3 . 9 $289, 316, 708 $283, 033, 594

+2.2

32,130, 000

30, 713, 200

+4.6

38,139, 500

36, 585, 500

+4.2

63,189,185

60, 608, 343

+4.3

327, 456, 208

319, 619, 094

+2.5

393
494, 623

378
622, 267

+4.0
-20.5

721
4,177, 796

706
6,178, 319

+2.1
— 32.4

195, 503
1,460, 970
1, 387, 993
839, 835

211, 635
1, 612, 647
1,476,106
744, 302

-7.6
-9.4
-6.0
+ 12.8

304, 748
1,184, 850
2, 295, 509
1, 312, 551

428,488
1, 335, 220
2,123, 275
1, 270, 915

—28.7
— 11.2
+ 8.1
+ 3.3

3, 884, 301
64, 092, 040

4, 044, 690
60, 457, 222

-4.0
+6.0

5, 097, 658
272, 553, 644

5,157, 898
269,186,133

— 1.2
+1.3

6, 905,419
45, 812

6, 546, 833
80, 273

+ 5.5
-43.0

21,437, 540
1, 996, 953

20, 999,126
2, 216,130

+2.1
— 9.9

6, 951, 231

6, 627,106

+4.9

23,434,493

23, 215, 256

+.9

These totals include loans made for other purposes than those listed.

262




Federal Home Loan Bank

Review

tion was second with 29.5 percent; purchase
of homes was third with 24 percent; and
reconditioning accounted for 5.5 percent.
A considerable reduction in loans for reconditioning and new construction during
the month (due undoubtedly to the bad
weather) was compensated by an increase
in loans for refinancing and purchase. Incidentally, it should be pointed out that
only additional funds loaned by the associations are reported under refinancing.
An existing loan which is merely rewritten without additional financing is not
included.
Repurchases of shares by the 898 reporting Federal associations during February
TABLE 2.-—Progress

were 31.4 percent less than during January»
In contrast to the net increase of 2.9 percent
in advances obtained from the Federal
Home Loan Banks was a drop of 11 percent
in borrowings from other sources during
February.
N E W FEDERAL CHARTERS GRANTED

Federal charters were granted
to savings and loan associations during
February. Seven were newly organized
and 10 were converted from State-chartered
associations (table 2). The 17 associations
had combined assets of $13,382,056. As of
the end of February there were 1,061 associations in the System with assets totaling
$521,979,315.
SEVENTEEN

in number and assets
*o/ the Federal Savings and Loan System

Number at 6-month intervals

Number

Assets

Dec. 31, June 30, Dec. 31, June 30, Jan. 31, Feb. 29,
1933
1934
1935
1936
1934
1936
New
Converted
Total

April 1936




Jan. 31, 1936 Feb. 29,1936

57
2

321
49

481
158

554
297

610
434

617
444

$75,119, 589
433, 837, 670

$75, 312, 891
446, 666, 424

59

370

639

851

1,044

1,061

508, 597, 259

521, 979, 315

263

Federal Savings and Loan Insurance
Corporation

D

URING the month ending March 14,
51 savings and loan associations with
combined assets of more than $33,000,000
applied for insurance. Of the applicants,
20 were operating under State charters, 19
had just converted to Federal charters, and
12 were newly organized Federals. During the same period insurance certificates
were delivered to 27 associations, of which
11 were State-chartered, 7 were converted
Federals, and 9 were new Federals. Their
combined assets totaled nearly $15,000,000
and their shareholders, whose savings now
enjoy insurance protection, numbered
23,080.

REPORTS FROM INSURED ASSOCIATIONS

confidence is very often reposed in
an industry rather than in an individual
institution. To such an extent has this
proved true in the savings and loan business since 1930 that many absolutely sound
individual associations have been unable to
overcome public suspicion of the industry
as a whole. In some communities even
such evidences of soundness as meeting
withdrawals and maintaining dividends
have not been sufficient. The public seems
to demand some new and striking proof of
safety, such as that offered by Federal inPUBLIC

Progress of Federal Savings and Loan Insurance Corporation—Applications received and institutions insured
APPLICATIONS RECEIVED
Number at 6-month
intervals
Dec.
31,
1934

Converted F. S. and L. A
New F. S. and L. A
Total

June
30,
1935

Number

Dec.
31,
1935

Assets (as of date of application)

Mar.
14,
1936

Feb.
15,
1936

Feb. 15, 1936

Mar. 14, 1936

53
134
393

188
360
517

351
480
575

400
469
589

420
488
601

$629, 251, 700
468, 920, 450
12,101, 978

$644, 024,147
487,143, 251
12, 469, 626

580

1,065

1,406

1,458

1,509

1,110,274,128

1,143, 637, 024

INSTITUTIONS INSURED
Number at 6-month
intervals

Dec.
31,
1934
State-chartered associations
Converted F. S. and L. A.
New F. S. and L. A
Total

264




June
30,
1935

Dec.
31,
1935

Number

Feb.
15,
1936

Mar.
14,
1936

Number
of shareholders (as
of date of
insurance)

Assets (as of
date of insurance)

Share and
creditor liabilities (as of
date of insurance)

Mar.
14,
1936

Mar. 14, 1936

Mar. 14, 1936

4
108
339

45
283
512

136
406
572

170
424
584

181
431
593

356, 843
652, 309
42, 653

$291, 347, 817
433, 025,194
12,167,135

$263, 495, 722
394, 715, 844
11,451, 292

451

840

1,114

1,178

1,205

1, 051, 805

736, 540,146

669, 662, 858

Federal Home Loan Bank

Review

surance of shares. A case in point is
offered by a thirteen-and-one-half-milliondollar Ohio association, which has never
passed a semiannual dividend in 48 years.
In spite of this record it insured its share
accounts in 1935. In its recent annual report to its members, it makes the following
statement:
In the two months since insurance was announced, over 250 new accounts have been
opened at our office and many old customers
have resumed the habit of adding to their accounts. Over 100 new mortgage loans have been
made to facilitate sales, repairs, and refinancing,
amounting to over a quarter of a million dollars.
Additional evidence of the capacity of
share insurance to solidify the confidence
of the investing public in savings and loan
associations is given by a State-chartered
association in Kansas, which writes as
follows:
In the early part of 1933, we had the misfortune to lose all of the banks in this city, which
left this association as the only financial institution, naturally resulting in a quite heavy withdrawal list and while we felt and knew that
fundamentally the association was in a safe and
stable condition, yet, we were also aware, due
largely to influences foreign to our institution,
it would perhaps be necessary for us to offer to
the public some measure of security in addition
to our own resources and felt the insurance of
accounts would assist in bridging the gap.
It is our candid opinion that insurance has
been very influential in restoring confidence resulting in the gradual opening of a very satisfactory number of new accounts. The first
thirty days following the announcement of our
insurance, we had opened 19 new accounts totaling about $15,000. We believe, of course, some
of these accounts would have been started but
are convinced that a large majority were due
to the insurance.

Suggestions for the

Advertising of all Associations
INSURED ST

Federal Savings and Loan Insurance Corporation
{This folder should be kept for permanent reference by the executive of your association in charge
of advertising, and41 copy should be given to any advertising agency retained by your association.)
The value of advertising the insurance feature, as a means of attracting new
savings to insured institutions, has already been fully demonstrated by the experience of many associations throughout the United States. For the most part, such
advertising has accurately set forth to the public what insurance is, and how it operates. Properly presented, insurance invites public confidence. Insurance should
not be misrepresented by false claims, nor the omission of material facts. It can stand
on its own merits. It should be advertised.
In the interest of insured associations themselves, and for the protection of the
general public against possible confusion and, likewise, with a view to compliance
with Section 17* of the^ Securities Act of 1933, the Federal Savings and Loan Insurance Corporation calls the attention of. every insured association to the brief list of
suggestions below. They are intended as a guide to sound advertising practice, and
the avoidance of advertisements which may be in conflict with Federal laws. Adherence to them will prevent the risk of misrepresentation in newspaper, magazine, radio
and other advertising.
1. Make clear that share accounts are insured only "up to $5,000".
2. Share accounts are not insured by the Federal Government, and should not be so
advertised, particularly in any possibly misleading form, as, for instance, printing
in small type words such as "by an agency of", and in large type uie words "United
States Government", in referring to insurance by the Corporation.
3. Unless otherwise provided for at die time insurance is granted, the advertisement
of a definite future rate of return on insured investment is contrary to die regulations
of the Insurance Corporation. It should not be done directly or indirectly (as by
displaying the latest dividend rate in bold type, and die qualifying phrase in obscure
lettering). Advertising die latest dividend rate or the lowest past rate paid by the
association is proper, but to suggest mat die same rate it guaranteed for the future,
as a minimum or owerwise, is definitely misleading to prospective investors.
4. Since insurance by die Corporation is • guarantee of safety, and not of liquidity,
there should be no representation in advertising by an insured association that insurance involves any guarantee or promise whatever on die part of die association to
permit repurchase or withdrawals on demand.
5. Share accounts or deposits of insured associations should not be advertised as
being "as sate as a U. S. Government bond." It is sounder policy to point out die
desirable features of your own product, rather mantoargue mat it is "as good as",
or "better man", something else. This is especially the case in die investment field,
where the four distinct elements of yield, security, liquidity and stability of price
make fair comparison difficult.
6. Dividends on insured share accounts should not be advertised as "interest". The
latter term is applicable only in the case of insured deposits.
7. Insured share accounts should never be referred to as "deposits", eidier in advertisements or in verbal sales presentation.
The cooperation of every insured association, in carrying out the foregoing suggestions in its own sales and advertising program, is invited by the Federal Savings
and Loan Insurance Corporation. Self-regulation in such matters is in every way
preferable to the imposition of hard and fast rules, caused by the persistent violation

SUGGESTIONS FOR ADVERTISING INSURANCE

T H E attention of member associations is
called to the accompanying reproduction
of a leaflet containing suggestions for advertising the insurance feature. It presents
further evidence of the Corporation's policy
of encouraging accurate and informative advertising as an important part of the task of
attracting savings to insured associations.
April 1936



of sound business principles by a small minority of the institutions concerned.

•"FRAUDULBNT INTKRSTATB TRANSACTIONS

Sec. 17. (a) It shall be unlawful for any person in the sale of any securities by the use of
any means or instruments of transportation or communication in interstate commerce or by
the use of the mails, directly or indirectly—
(1) to employ any device, scheme, or article to defraud, or
(2) to obtain money or property by means of any untrue statement of a material foot or
any omission to state a material fact necessary in order to make the statements made,
in the light of the circumstances under which they were made, not misleading,

(c) The exemption* provided in section S shall not apply to the provisions of this section."
—Extract from the Securities Act of1993.

265

Home Owners' Loan Corporation
H. 0. L. C. subscriptions to shares of savings and loan associations—Requests and subscriptions
Uninsured State-chartered members of
Insured State-charthe F. H. L. B.
tered associations
System

Federal savings and
loan associations

nr^+rti

Number
Number
Number
Number
Amount
Amount
Amount
Amount
(cumu- (cumulative)
(cumu- (cumulative)
(cumu- (cumulative)
(cumu- (cumulative)
lative)
lative)
lative)
lative)
Requests:
Sept. 30, 1935
Oct, 31, 1935
Nov. 30, 1935
Dec. 31, 1935
Jan. 31, 1936
Feb. 29, 1936
Mar. 20, 1936
Subscriptions:
Sept. 30, 1935
Oct. 31,1935
Nov. 30, 1935
Dec. 31, 1935
Jan. 31, 1936
Feb. 29, 1936
Mar. 20, 1936

7
12
21
27
30
39
45

$465, 800
615, 800
1, 087, 500
1,131, 700
1, 301, 700
2, 601, 700
2, 206, 700

6
13
21
33
42
48
61

$525,000
1, 205, 000
1, 875, 000
2, 480, 000
3,150, 000
3, 885, 000
4, 845, 000

11
229
407
553
662
811
899

$1, 301, 000
8, 888, 500
16, 062, 000
21,139, 000
24, 681, 600
30,145,100
32, 829, 600

24
254
449
613
734
898
1,005

$2, 291, 800
10, 709, 300
19, 024, 500
24, 750, 700
29,133, 300
36, 631, 80G
39, 881, 300

1
3
2
6
9
7

50, 000
115, 000
100, 000
285, 000
535, 000
345, 000

3
7
15
24
35
38
47

150, 000
900, 000
1, 460, 000
1, 980, 000
2, 525, 000
2, 950, 000
3, 885, 000

130
305
474
594
729
836

3, 888, 500
11, 496, 500
17, 766, 500
22, 233, 500
26, 913,100
30, 725, 600

3
138
323
500
635
776
890

150, 000
4, 838, 500
13, 071, 500
19, 846, 500
25, 043, 50O
30, 398,100
34, 955, 600

Applications received and loans closed by months x

Period

Applications
received
(number)

Loans closed
Amount

Number

1933
From date of opening through Sept. 30
From Oct. 1 through Dec. 31

403,114
319, 682

593
36, 656

$1, 688, 787
104, 231, 556

790, 836
226, 863

307, 651
381, 341

933, 082,197
1,157, 985, 268

143, 638

155, 214
90, 335

463, 689, 204
279, 352, 039

14,192
9,392
5,375

44, 409,162
29, 984,463
16, 746, 248

1, 000, 749

3, 031,168, 924

1934
From Jan. 1 through June 30
From July 1 through Dec. 31

2

1935
From Jan. 1 through June 30
From July 1 through Dec. 31
1936
January
February
Mar. 1 to Mar. 19
Grand total to Mar. 19, 1936
1
2

1, 884,133

These figures are subject to adjustment.
Receipt of applications stopped Nov. 13, 1934, and was resumed for a 30-day period beginning May 28, 1935.

266



Federal Home Loan Bank

Review

Reconditioning Division—Summary of all reconditioning operations through Mar. 12, 1936
Number of
applications
received for
reconditioning loans

Period

June 1, 1934 through Feb. 13, 1936
Feb. 14, 1936 through Mar. 12,1936 *
Grand total through Mar. 12, 1936

Total contracts executed

Number

Amount

Total jobs completed

Number

Amount

667, 834
2,644

7,062

$65, 057, 018
1, 656,121

300, 967
3,066

$56, 501, 834
750, 344

670, 478

340, 506

66, 713,139

304, 033

57, 252,178

1

The figures for this period are subject to correction.
NOTE.—Prior to the organization of the Reconditioning Division on June 1, 1934, the Corporation had completed
52,269 reconditioning jobs amounting to approximately $6,800,000.

Foreclosures authorized and properties acquired by the Home Owners9 Loan Corporation

Period

January..
February.

Properties acForeclosures quired by volstopped* untary deed and
foreclosure2

30

Prior to 1935.
Jan. 1 through June 30.
July 1 through Dec. 31.

Foreclosures
authorized

1935

1936

Grand total to Feb. 29, 1936.

536
3,904

7
190

72
1,115

1,281
1,544

27
49

334
450

7,295

273

1,977

1
2

Due to payment of delinquencies by borrowers after foreclosure proceedings had been entered.
Does not include 520 properties bought in by H. O. L. C. at foreclosure sale but awaiting expiration of the redemption period before title and possession can be obtained.
In addition to this total of 1,977 completed cases, 12 properties were sold at foreclosure sale to parties other than
H. O. L. C.

April 1936




267

Directory of Member, Federal, and Insured
Institutions
Added during February-March
I. INSTITUTIONS ADMITTED TO MEMBERSHIP
IN THE FEDERAL HOME LOAN BANK SYSTEM BETWEEN FEBRUARY 24, 1936, AND
MARCH 21, 1936 l
(Listed b y Federal Home Loan Bank District, States, and
cities)
DISTRICT NO. 1
CONNECTICUT :

Norwalk:
Norwalk Building, Loan & Investment Association,
115 Washington Street.
MASSACHUSETTS :

Taunton:
Taunton Co-operative Bank.

DISTRICT NO. 6
INDIANA :

Evansville:
Fidelity Savings & Loan Association.
Peoples Building & Loan Association of Evansville,.
2011 West Franklin Street.
Hammond:
Calumet Building & Loan Association, 423 Fayette
Street.
DISTRICT NO. 7
ILLINOIS :

Kewanee:
Kewanee Building & Loan Association, 211 North
Tremont Street.
WISCONSIN :

Milwaukee:
Mutual Building & Savings Association, 739 North
Broadway.

VERMONT :

DISTRICT NO*. 8

Randolph:
Randolph Co-operative Savings & Loan Association.
DISTRICT NO. 2
N E W JERSEY:

Ridgefleld:
Oratam Building & Loan Association, 527 Broad
Avenue.
DISTRICT NO. 3
PENNSYLVANIA:

Ardmore:
Lower Merlon Building & Loan Association.
Brackenridge:
Brackenridge Building & Loan Association.
Shamokin:
Keystone Building & Loan Association of Shamok i n , Pa., 25 West Independence Street.
DISTRICT NO. 4

MISSOURI :

Clinton:
Henry County Building & Loan Association of Clinton, Mo.
DISTRICT NO. 10
NEBRASKA:

Lincoln:
American Savings & Loan Association.
OKLAHOMA :

Broken Arrow:
Broken Arrow Building & Loan Association.
DISTRICT NO. 12
CALIFORNIA :

Los Angeles:
Insurance Plan Building & Loan Association, 544
South Grand Avenue.
Lincoln Building & Loan Association, 20 Spring
Street Arcade.

SOUTH CAROLINA:

New Brookland:
Lexington County Building & Loan Association.
VIRGINIA :

Norfolk:
State Building Association of Norfolk, Incorporated,
220-222 East Plume Street.
DISTRICT NO. 5
OHIO:

Cleveland:
Cleveland Building & Loan Company, 515 Euclid
Avenue.
Miamisburg:
Mutual Building & Loan Company of Miamisburg,
Ohio.
1
During this period 12 Federal savings and loan associations were admitted to membership i n the System.

268




WITHDRAWALS FROM THE FEDERAL HOME LOAN
BANK SYSTEM BETWEEN FEBRUARY 24, 1936„
AND MARCH 21, 1936
ARKANSAS :

Little Rock:
Guaranty Building & Loan Association, 125 Main.
Street (association liquidating).
GEORGIA :

Macon:
Macon Building & Loan Association, 417 Broadway
(association liquidating).
INDIANA :

Lebanon:
First Rural Loan & Savings Association (association liquidating).
Rural Credit Loan & Savings Association, 207 W e s t
Main Street (association liquidating).

Federal Home Loan Bank Review-

NEW

HAMPSHIRE:

Derry:
Derry Savings Bank (association liquidating).
N E W JERSEY:

Dover:
Randolph Building & Loan Association, 33 Blackw e l l Street.
NORTH CAROLINA:

Roanoke R a p i d s :
Rosemary Building & Loan Association, 1102 Roanoke Avenue.
TENNESSEE :

Jackson:
Home Building & Loan Association, 503 First National Bank Building.

OHIO—Continued.
Tippecanoe City:
Monroe Federal Savings & Loan Association of T i p pecanoe City, 8 East Main Street (converted from
Monroe Building & Loan Association).
Urbana:
Perpetual Federal Savings & Loan Association of
Urbana, 106 Scioto Street (converted from Perpetual Savings Association).
TENNESSEE :

Dickson:
First Federal Savings & Loan Association of Dickson.
DISTRICT NO. 6
INDIANA :

TEXAS:

San Antonio:
Security Building & Loan Association
liquidating).

(association

VIRGINIA :

Clifton Forge:
Mutual Building & Loan Association, Incorporated,
441 East Ridge w a y Street (association liquidating).
W E S T VIRGINIA:

Wellsburg:
Advance Building Association, 727 Charles Street
(association liquidating).

Evansville:
Evansville Federal Savings & Loan Association, 14
Northwest Fourth Street (converted from F i d e l i t y
Savings & Loan Association).
MICHIGAN :

Adrian:
Adrian Federal Savings & Loan Association, 121
West Maumee Street (converted from Adrian
Building & Loan Association).
DISTRICT NO. 7
ILLINOIS :

II. FEDERAL SAVINGS AND LOAN ASSOCIATIONS CHARTERED BETWEEN FEBRUARY 24, 1936, AND MARCH 21, 1936

Chicago:
Cook County Federal Savings & Loan Association,
176 West Adams Street.
DISTRICT NO. 8

(Listed b y Federal Home Loan Bank Districts, States, a n d
cities)
DISTRICT NO. 1
CONNECTICUT :

Meriden:
First Federal Savings & Loan Association of Meriden, 20 Church Street (converted from Fourth
Meriden Building & Loan Association).
DISTRICT NO. 2
N E W YORK:

Amsterdam:
Amsterdam Federal Savings & Loan Association,
62 Milton Avenue.
New York:
Flatbush Federal Savings & Loan Association of
Brooklyn, 549 East Twenty-sixth Street (converted from Flatbush Co-operative Savings &
Loan Association).
DISTRICT NO. 4
MARYLAND :

Rosedale:
Rosedale Federal Savings & Loan Association (converted from Rosedale Permanent Building & Loan
Association of Baltimore County).
DISTRICT NO. 5

SOUTH DAKOTA:

Canton:
First Federal Savings & Loan Association of Canton
(converted from Canton Building & Loan Association).
DISTRICT NO. 11
OREGON:

Eugene:
First Federal Savings & Loan Association of E u gene, 1057 Patterson Street.
WYOMING :

Buffalo:
Buffalo Federal Savings & Loan Association.
DISTRICT NO. 12
CALIFORNIA :

Sacramento:
Capital Federal Savings & Loan Association, 805
Jay Street (converted from Capital Building &
Loan Association).
San Francisco:
Home Federal Savings & Loan Association of San
Francisco, 1919 Octavia Street.

CANCELATIONS OF FEDERAL SAVINGS AND LOAN
ASSOCIATION CHARTERS BETWEEN FEBRUARY 24„
1936, AND MARCH 21, 1936

OHIO:

Bowling Green:
First Federal Savings & Loan Association of Bowling Green.
Columbus:
Dollar Federal Savings & Loan Association, 51 East
Gay Street (converted from Dollar Building &
Loan Company).

April 1936




INDIANA :

Evansville:
Evansville Federal Savings 8c Loan Association.
(This i s tfie charter originally granted to a n e w l y
organized association of this name. A new charter has been granted to a converted association
under the same name.)

269

III. INSTITUTIONS INSURED BY THE FEDERAL SAVINGS AND LOAN INSURANCE
CORPORATION BETWEEN FEBRUARY
24, 1936, AND MARCH 21, 1936x

OHIO—Continued.
Belief ontaine:
The Savings Building & Loan Company.
North Bend:
Cleves-North Bend Building & Loan Company.

<Listed b y Federal Home Loan Bank Districts, States, and
cities)

INDIANA :

DISTRICT NO. 6
Bargersville:
Bargersville Building & Loan Association.

DISTRICT NO. 3
PENNSYLVANIA :

Philadelphia:
Abraham Lincoln Building & Loan
2608 North Twenty-ninth Street.

DISTRICT NO. 7
Association,

DISTRICT NO. 4
NORTH

St. Francis:
St. Francis Building & Loan Association, 3521 South
Kinnickinnic Avenue.

CAROLINA:

Salisbury:
Citizens Building & Loan Association of Salisbury,
N. C , 121 West Innes Street.
SOUTH

WISCONSIN :

CAROLINA:

N e w Brookland:
Lexington County Building & Loan Association.
DISTRICT NO. 5
OHIO:

Akron:
Permanent Savings & Loan Company, 55 East Mill
Street.
1

During this period 16 Federal savings and loan associat i o n s were insured.

270




DISTRICT NO. 9
TEXAS:

Amarillo:
Panhandle Building & Loan Association, 111 West
Sixth Street.
DISTRICT NO. 10
KANSAS :

Abilene:
Dickinson County Building & Loan Association.
DISTRICT NO. 12
CALIFORNIA :

Inglewood:
People's Building & Loan Association, 150 South
Market Street.

Federal Home Loan Bank Review
U. S. GOVERNMENT PRINTING OFFICE: 1936

FEDERAL HOME LOAN BANK DISTRICTS

M M » BOUNDARIES OF FEDERAL HOME LOAN BANK DISTRICTS.
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FEDERAL HOME LOAN BANK CITIES.