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Vol. 5
FEDERAL
HOME LOAN BANK
REVIEW
FEBRUARY
1939
ISSUED BY
FEDERAL HOME LOAN BANK BOARD
WASHINGTON D . C .
The FEDERAL HOME LOAN BANK REVIEW
continues its annual custom of surveying the preceding year in its February issue, which is primarily a year-end statistical number. In addition to the narrative discussion of the general
significance of trends indicated by the year-end
figures, this issue contains the usual monthly
statistics and also selected statistical reports for
the entire year 1938. It is the most valuable
issue for reference that is published during the
year.
CONTENTS FOR FEBRUARY
FEDERAL
SPECIAL
1939
ARTICLES
Page
HOME
LOAN
BANK
REVIEW
Published monthly by the
FEDERAL HOME L O A N
BANK BOARD
John H. Fahey, Chairman
T. D. Webb, Vice Chairman
F. W. Catlett
W. H. Husband
r. W. Hancock, Jr.
FEDERAL HOME LOAN
BANK SYSTEM
Review of 1938
Wisconsin test case withdrawn from Supreme Court docket
130
139
STATISTICS
Residential construction and home-financing activity
Residential construction
Small-house building costs
Mortgage-lending activity of savings and loan associations
Federal Savings and Loan System
Federal Savings and Loan Insurance Corporation
Federal Home Loan Bank System
Dividends paid or declared
Condensed consolidated statement of condition
Comparative statement of condition, 1938, 1937, 1936
Interest rates on advances to members
Statistical tables
Nos. 1, 2: Number and estimated cost of new family dwelling units . . .
No. 3: Indexes of small-house building costs
Nos. 4, 5: Estimated lending activity of all savings and loan associations .
No. 6: Index of wholesale price of building materials
No. 7: Monthly operatiors of Federal and State-chartered insured associations
No. 8: Institutions insured by the Federal Savings and Loan Insurance Corporation
No. 9: Lending operations of the Federal Home Loan Banks
Nos. 10, 11, 12: Home Owners' Loan Corporation
Supplemental tables:
A: Statement of condition of the Federal Home Loan Banks
B: Statement of profit and loss of the Federal Home Loan Banks . . . .
146
148
148
149
149
150
151
151
152
153
168
154
154
156
158
159
160
160
161
161
162
164
FEDERAL SAVINGS AND LOAN
ASSOCIATIONS
FEDERAL SAVINGS AND LOAN
INSURANCE CORPORATION
HOME OWNERS' LOAN
CORPORATION
REPORTS
From the month's news « . . . .
Counsel's opinions and Board resolutions
Directory of member, Federal, and insured institutions added during DecemberJanuary
145
166
167
SUBSCRIPTION P R I C E OF REVIEW. The FEDERAL H O M E LOAN B A N K REVIEW is the Board's medium of communication with member
institutions of the Federal Home Loan Bank System and is t h e only official organ or periodical publication of the Board. The REVIEW
will be sent to all member institutions w i t h o u t charge. To others t h e a n n u a l subscription price, which covers the cost of paper and
printing, is $1. Single copies will be sold a t 10 cents. Outside of t h e United States, Canada, Mexico, and t h e insular possessions, subscription price is $ 1 . 6 0 ; single copies, 15 cents. Subscriptions should be sent to and copies ordered from Superintendent of Documents,
Government P r i n t i n g Office, Washington, D. C.
A P P R O V E D BY T H E BUREAU OF T H E BUDGET.
122746—39
1
SUMMARY: "REVIEW OF 1938»
/. Vital statistics: 1938.
INCOME PAYMENTS
A. Of the savings and loan industry:
1. Some definite indications of increases in total assets of all associations for the
first time since 1929:
{ INDUSTRIAL
a. A majority
PRODUCTION/
of each class of member associations of the Bank System
showed increased assets.
2. Home mortgage lending down 12 percent from 1937, despite improved trend in
last six months.
^FACTORY
3. Rate of increase in private capital better than in 1937.
EMPLOYMENT
4. Real estate holdings drop for third successive year, although less rapidly than in
1937.
B. Of general business: Declines of major business indices sharper than for indicators of
savings and loan
activity.
1. Pattern of 1938: first five months of gradually slower declines, followed by seven
. FREIGHT
successively better months, with levels of activity at end of year at least equal
CAR-LOADINGS
to 1937 year-end figures.
2. Money rates show no tendency to harden.
IL Recovery in residential construction an important contribution to economic improvement
TOTAL MORTGAGE LOANS
(S. 8 L. ASS'NS.)
during
1938.
A. A 23-percent rise in number of dwelling units built—17-percent
$350
increase in total cost—
decrease in average cost per unit.
B. Building costs receded slightly: Material
prices down 4.7 percent/ labor costs up frac-
tionally.
C. Increasing support of Federal Home Building Service Plan promises better small-house
planning and construction.
D. Greatest
market opportunities in home properties costing less than $4,000.
Actual
construction above this level.
k RESIDENTIAL
E. Outlook:
CONSTRUCTION
Optimistic,
barring increased costs, lower rents, or unfavorable
international
developments.
III. Home-mortgage
lending:
1938.
A. Savings and loans made almost half of estimated total home-mortgage loans by private
institutional
lenders in 1938—slightly
below their share in 1937.
B. Increased volume of Federal Housing Administration business.
C. Trends: Longer-term loans/ higher percentages of appraised value/ lower interest rates.
IV. Real estate sales, though below 1937, parallel
A. Continued diminution of "overhang"
recovery movement of industrial
encouraging: Identical
production.
group of savings and loan
associations showed 1.4-percent decrease during first six months.
B. Foreclosures 22 percent under 1937.
Fifth consecutive year
C. Rental index: Of newly rented properties—down
downward.
in 1938/ of occupied
dwellings—
constant.
[D. Average tax rates up $0.65
per $1,000.
Opposition mounting to inequitable
taxation
of real estate.
LONG-TERM
U S. BOND
V. Private savings during 1938.
A. Increases: U. S. Savings Bonds—48 percent/ Federal savings and loan
YIELDS
percent/ mutual savings banks—1.1
B.T Decreases: Postal Savings—1.4
banks—0.2
associations—28
percent.
percent/
time deposits in Federal
Reserve member
percent.
C. Rate of return on savings continued to decrease.
RENTALS
VI. Savings and loan associations, in keeping with trends to improve public relations, give increased
(N.I.C.B.)
thought and attention to office location and appearance,
DE&
MAR.
JUN.
1937
130
SEP.
DEC.
MAR.
JUN.
1938
SEP
dition, and adequate
use of effective advertising
preparation
of statements of con-
media.
Federal Home Loan Bank Review
REVIEW OF 1938
"How good was your business in 1938?": the REVIEW invites
savings and loan officials to compare trends in their own
associations during 7938 with regional and national vital
statistics of the savings and loan industry, and with the general
economic pattern.
•
T H E savings and loan industry had good reason
to mark 1938 as an eventful and progressive year.
In 1938, for the first time since the years prior to the
depression, there were some definite indications that
total resources of all savings and loan associations in
the country registered an upturn. The growth in
total assets of an identical group of member associations of the Federal Home Loan Bank System was
evidence of a continuation of the improvement shown
by all savings and loan associations during 1937.
Of particular significance was the fact that in 1938
for the first time in years a majority of each class of
member associations showed increases in assets.
Year-end trends of 1938 and 1937 moved in opposite directions. The year 1937 ended with the
savings and loan industry resisting the downward
spiral of one of the sharpest recessions in general
business ever recorded in this country. As far as is
possible at this early date, the Division of Research
and Statistics has analyzed the pattern of savings
and loan operations in 1938 against the background
of general business conditions. The object: to reveal
the timing and extent of these changes in the industry
compared with changes in the entire national economy during 1938, and so to indicate probable trends
in 1939.
Study of an identical group of 3,500 member
savings and loan associations of the Federal Home
Loan Bank System, including both Federal and
State-chartered and insured and uninsured associations, showed that during the latest 12-month period
for which statements are available (primarily the
year ending in September 1938), these associations
reported an increase in assets of $151,000,000, or 4.5
percent, over 1937. This improvement, while
affected by the sizeable gains in Federal associations,
appears to have been general throughout the United
States, since assets of identical members in each of
the Bank Districts contributed to the favorable
showing with a majority of members of all classes
registering increases.
February 1939
To permit executives to compare the 1938 rate of
growth of their associations with the norm in their
Districts, the dollar and percentage increases in
assets have been charted. The most striking advance
was made by members in the Winston-Salem District, where an increase of more than 15 percent
($45,000,000) was shown. Increases of more than
5 percent were recorded by member associations in
the Portland, Little Rock, Des Moines and Los
Angeles Districts in addition to Winston-Salem.
Although the smallest amount of gain was reported
by members in the New York District, this trend is
largely attributable to the condition existing in
associations in the State of New Jersey.
This survey, covering principally the recession
months and ending before the effect of the favorable
trends of the final quarter of 1938 could be estimated,
is particularly significant because it shows that the
majority of the member uninsured State-chartered
institutions recorded a growth in assets. Although it
has been usual for assets of Federal and insured Statechartered associations to increase, the 1938 expanGROWTH IN ASSETS OF 3,491 IDENTICAL FEDERAL HOME LOAN BANK MEMBERS
Based on Latest 12-Month Period
F.H.L.B. Dist. Dollar Amt.
Number
( 0 0 0 omrtted)o
U.S.
PERCENT
INCREASE
10
$150,906 H H I H H
4
II
9,219 H H I H H B H m
9
i4,2i4
8
11,603 MHMMHMMBMBH
12
14,900 M H M H M H | H M |
3
I
H
6,021
H
m
H
H
n
13,974 H H H H
6
7,288
7
10,929 H H H
5
15,598 B H H
10
2,491 H | | |
2
S
70 I
B H i
0.01%
I3I
sion of assets of most of the member uninsured institutions effects a reversal of the trend of recent years.
Despite the encouraging growth in their total
resources, lending of savings and loan associations
followed recession trends downward. The salient
fact about 1938 was that every month, through
November, showed a lower volume of mortgage loans
than the corresponding month of 1937. There
were two consolations: first, although in June lending
activity stood 21 percent below 1937, in December,
loan volume was 6 percent greater than 1937; and
second, during each of the last five months of the
year the construction loan volume was exceeding
1937 levels.
From the standpoint of the volume of home
financing by savings and loan associations, 1938
occupied an intermediate position between 1936—
the year in which the first pronounced revival took
place—and 1937, a year characterized by a striking
growth in lending during the first six months and a
sharp decline during the last half.
Compare the loan volume chart with the chart of
seasonally adjusted monthly indexes of industrial
production. Industrial activity during the first six
months of 1938 fluctuated within a narrow range at
about the production level of 1933 and 1934. Savings and loan lending, although dropping below the
recovery peak levels attained in 1937, did not recede
appreciably below the monthly levels of 1936, and
did not fall as far nor as rapidly as did major indexes
of general business conditions such as industrial
production.
Decreases in lending activity varied widely from
District to District. The accompanying chart,
which shows that only the Little Rock District increased its loan volume over 1937, permits comparison of an individual association's percentage change
in mortgage loan volume between 1938 and 1937
with the change in the loan volume in its District.
MEW MORTGAGE LOANS
OF ALL 6. 6 L. ASSOCIATIONS
132
INDEX
OF INDUSTRIAL
PRODUCTION
Although mortgage lending slumped in 1938 there
were indications that savings and loan associations
received a substantial increase in private investments,
in spite of the fact that national income was substantially reduced. Study of a comparable number
of Federal savings and loan associations reveals that
during the year 1938 the increase in private repurchasable capital amounted to 20 percent—an increase greater than the gain recorded for the year
1937. There was also a substantial increase in the
number of shareholders in 1938. During the year,
all Federal associations increased the number of their
investing members from 893,000 to 1,164,000 (including the growth due to the net gain of 43 in the
number of Federals.) Private repurchasable capital
increased from 60.8 percent of total liabilities to
65.5 percent.
PERCENT CHANGE IN CUMULATIVE (I I MONTHS) LENDING ACTIVITY
OF ALL SAVINGS AND LOAN ASSOCIATIONS
From 1937 to 1938 - By F.HLB. Districts
PERCENT DECREASE
20
15
10
O
PERCENT INCREASE
5
10
Further comparison of the rate of flow of investments into savings and loan associations during 1938
is offered by the bar chart at top of facing page
which shows that approximately one-half of the
1,653 identical reporting insured associations increased their private repurchasable capital by more
than 25 percent during the year. Two-thirds of the
associations reported increases of more than 10 percent, and another group of 322 associations showed
increases of 10 percent or less. Decreases were
recorded in only 195 associations.
As is natural, new Federal associations clustered
in the higher ranges of percentage gains, since they
are newly organized and are growing rapidly from
a relatively small base. State-chartered insured
Federal Home Loan Bank Review
CHANGE IN PRIVATE
PERCENT CHANGE
1937 TO 1938 'OO
%
10% TO
50%
§
0
TO
10%
0
TO
10%
10% TO
25%
2 5 % TO
50%
REPURCHASABLE
CAPITAL
NEW FEDERAL ASSOCIATIONS
NUMBER -INCREASE
20 40 60 60 IQO 120 140 160 180 200
IN 1,653
Ul
»
INSURED ASSOCIATIONS REPORTING AS OF DECEMBER
NUMBER-DECREASE
Hi
<
IDENTICAL
CONVERTED FEDERAL ASSOCIATIONS
50% TO 100% |
100% TO 250%
250% TO 500%
NUMBER-INCREASE
40
Conditions During 1938
BUSINESS conditions during 1938 may be
divided generally into two definite periods: (1)
five months of a gradual slowing up of the downward
tendency of business indexes which plumbed the
depths in May and the early part of June; and, (2)
seven monthly periods from June through December,
each one of which was a distinct improvement over
the preceding one.
The Federal Reserve index of industrial production (converted to a 1926 base) opened the year
at 74, and floated down to the year's low of 70 in
May. Then, in one of the most spirited recoveries
on record, the average reached 96 in December.
The annual average for 1938, however, was 80 as
compared with 101 in 1937. Production of steel,
100
11
The Pattern of General Business
February 1939
80
NUMBER-DECREASE
100 80
60
40
20
NUMBER -INCREASE
0
20
40
60
80
(00 120 140
PERCENT CHANGE
^937 fQ
1938
10% TO
associations showed definite growth with the largest
number found in the range of 0 to 10 percent increases
in 1938.
Publication by the F . H. L. B. B. of the 1937
consolidated balance sheet for all savings and loan
associations reveals the extent to which savings and
loan associations have been liquidating their real estate holdings. During 1937 the $130,000,000 drop in
their real estate holdings represented a 11.3-percent
decline, a very significant improvement over the 1.1percent reduction in 1936, the first year of this
decade in which a downward trend was shown.
During the first six months of 1938, associations
continued to dispose of owned real estate, although
apparently not so rapidly as in 1937. Real estate
owned by 1,736 insured associations declined 1.4
percent in the first half of 1938, before pronounced
business revival began.
•
60
1937 AND DECEMBER 1938
INSURED STATE ASSOCIATIONS
0
TO
0
50% g
10% §
TO
10%
10% TO
25%
25%
50% ;
TO
50% TO KX>% 2
100%
TO 2 5 0 %
250% TO 500%
automobiles, and electric power finished the year
above the levels at the end of 1937. The index of
the production of durable goods did not rise as fast
as that of nondurables; and its previous decline had
been more severe.
The factory pay rolls index of the Bureau of Labor
Statistics may be summed up thus: A slight rise
during the first quarter; an abrupt plunge to July's
low point of the year; a rapid increase during the
fall, with pay rolls higher than any month since
November 1937 at the close of the year.
Retail sales slumped 12 percent from activity of
the previous year according to Department of Commerce estimates. Sales of department stores, however, did not experience such a drastic decline, and
December sales were ahead of the 1937 Christmas
business, emphasizing again the upturn during the
closing months of 1938. Declines in wholesale commodity prices have brought the index to the lowest
point in four years, although its firmness during the
second half of last year may presage a reversal of
this movement. A sizeable excess of exports over
imports has existed each month since the autumn of
1937.
Bank debits throughout 1938 ranged from
72 to 77 percent of the 1926 level, as compared with
82 to 94 percent during 1937.
Inventories of manufactured goods, built up too
rapidly and contributing largely to the 1937 recession, appear to be at more satisfactory levels. Survey of Current Business third-quarter statistics show
that building material stocks were physically lower
than in 1937, with only a 2-month supply of oak
flooring and cement on hand. Freight-car loadings
increased considerably during the closing months,
and finished the year above the final 1937 levels.
National income is estimated at $64,000,000,000,
a decrease of 5 billion dollars from 1937 which was
the highest year since 1930.
I33
GENERAL MONEY MARKET
INDEX OF
CONDITIONS
Savings and loan managers are particularly interested in the trend in yields of long-term investments because of their comparability to dividend
rates and their ultimate effect upon home-mortgage
interest charges. Conditions during 1938 showed
that the downward trend of the past nine years in
the general money market had not come to an end.
This is evident from the accompanying chart which
pictures the yield pattern of investments from
1929-1938.
Yields on U. S. Government and high-grade corporate bonds established new lows in December.
The return on low-grade corporates which rose
sharply during 1937 and early 1938 was reduced
considerably in the last three quarters of 1938, but
the average yield on Baa-rated Bonds (Moody) was
still 21 percent above 1936.
BOND YIELDS; 1929 THROUGH 1938
•
1"
I'<*\
Baa
4t
V
i
^Aaa
"
f "*
""T
1 ^L
"
11
1
1
,
1930
1
7 ^
Corporates
->c
%
x
„ + * '"
K^
.^J-—»^L
1
1
1
Long Term U. S. Treasury
1929
C orporates
1931
1932
1
-
Bonds
1933
1
^'Lsy ^ * - —
»934
1935
1936
i
1937
1938
M a n y people believe that the decline in interest
rates is purely a result of the depression years.
Actually, long-term interest rates were showing a
tendency to decline prior to 1929, and the depression
merely increased their momentum.
-
. y
V ~
RESIDENTIAL
CONSTRUCTION AND INDUSTRIAL
1926 = 100
INDUSTRIAL PRODUCTION\S\
i
%
\\
\\
ir
V'
-
I
PRODUCTION
A
"TX\
*'*'
n
i
t
i
%
\
/
/
>
. /
r\
A
A
\
RESIDENTIAL CONSTRUCTIONS^/ *
V
VJ
V
V
'27
'28 '29 '30
_..
•33
'31
S^
'34
"35 *36
units costing in aggregate $1,330,000,000: a rise of
23 percent in terms of dwelling units; and an increase
of 17 percent in their total cost above 1937. The
bar chart on this page illustrates the decreasing average cost of each type of unit, and the structural distribution in all cities of over 10,000 in 1938.
Considering the increases of 1938 on the basis of
Federal Home Loan Bank Districts, the greatest rise
(65 percent) was shown in the New York region,
attributable partly to a new building code in New
York City which became effective early in the year.
Next in the order of their improvement over 1937
were Little Rock, Los Angeles, and Des Moines, with
39, 25, and 21 percent respectively. Only four Districts compared unfavorably: Cincinnati, Boston,
Chicago, and Topeka. In the rate of dwelling units
per 100,000 population, Los Angeles again led the
way, while Little Rock and Winston-Salem were
generally higher than the remaining Districts. Chicago and Boston recorded the lowest rates on this
basis.
NUMBER AND AVERAGE COST OF FAMILY DWELLING UNITS PROVIDED
Residential Construction
BY TYPE OF STRUCTURE - 1 9 3 8 compared with 1937
NUMBER - THOUSANDS OF UMTS
•
B A C K B O N E of a considerable portion of the
1938 economic recovery, residential construction
at the close of the year showed a rate within a few
points of the building recovery peak—February 1937.
Whereas 1937 was a year marked with almost continual receding from that top, 1938 brought a complete reversal of trend, and promises a continuation
of its upward march throughout 1939.
Preliminary estimates of the U. S. Department of
Labor, based on permits for public and private
building, indicate the total of residential construction in nonfarm areas during 1938 to be 356,000
134
200
150
100
COST- THOUSANDS OF DOLLARS
50
1
2
3
4
TOTAL
ALL TYPES
1938 warn
1937
HH
MULTIFAMILY
^
^
Federal Home Loan Bank Review
BUILDING COSTS
Virtually every forecast for residential construction activity during 1939 is "hedged" with statements
regarding the possibilities of increased building costs.
During the 12-month period ending in December the
average cost of the standard 6-room frame house
declined 2.8 percent due to reductions in material
prices (4.7 percent) rather than labor costs (up 1.0
percent). The last quarter of 1938 interrupted the
gradual upward trend of labor rates continuous since
the autumn of 1937. The decreases were nominal
and will bear watching for indications of the direction
of their next movement.
Material prices with the exception of the Cincinnati
and Indianapolis Bank Districts have been on the
decline since the middle of 1937, with the greatest
reduction in the cost of lumber. The final months of
1938 indicated a levelling off of the index, which
might foretell a reversal of trend.
USED IN
INDEXES OF COST OF MATERIALS AND LABOR
CONSTRUCTION OF STANDARD SIX-ROOM FRAME HOUSE
u JIT Et
S77 TE S AV EF AG E MONT H 1936 -10 0
4
t
0
*,N
0
0
N%
-V
•
0
0
AAT£ RlAL s
i
1 A 30 R,
DEC.
MAR.
JUN.
^
J^
SEP
1936
^
••
7 *.% •«•«-
^
DEC.
MAR.
JUN.
1937
SEP
DEC.
MAR.
JUN.
SEP.
DEC.
1938
FEDERAL H O M E BUILDING SERVICE P L A N
The Federal Home Building Service Plan, which
has been developed by the Bank Board to assist in
the proper planning, sound construction, and adequate financing of small homes, grew out of the extensive reconditioning experience of the H. O. L. C.
The achievement of its purposes depends upon the
earnest cooperation of all the elements of the building
field: The architect, the material manufacturer and
dealer, the contractor, and the mortgage lender. I t
provides the means whereby private industry may
do its part in improving the appearance and quality
of the Nation's small homes. In this field are
opportunities for an expanded volume of building.
Although it is as yet only a minor factor in the
total volume of residential construction, during 1938
the Plan continued to attract increasing support, as
efforts were made to broaden the area of field extension activity. The provisions of the Plan were
February 1939
revised to include other types of mortgage lenders,
augmenting the savings and loan associations already
participating.
The year 1939 should witness further progress in
the acceptance of the Federal Home Building Service
Plan, as it is now recognized that increased volume in
the low-priced field is directly dependent upon convincing the average American family, which can
afford only a $3,000-$6,000 home property, that the
dollar value obtained in purchasing a home is as
great as that obtainable from any basic national
industry.
HOUSING M A R K E T FOR
1939
Approximately three-fifths of the annual total of
residential units built are single-family detached
houses. I t is this type of property with which the
average savings and loan association is most often
concerned.
If we agree that the average family is not justified
in investing more than 2% times its annual income in a
house and lot, the National Resources Committee
analysis of urban nonrelief family incomes in 19351936 shows that only one family out of three could
afford a house and lot costing more than $5,000.
Construction statistics from 1929-1935 indicate
that with two-thirds of the Nation's families needing
less than $5,000 homes (including lots), at the most
only 47 percent of all 1-family dwellings were built
below that limit. Further, half of the American
families needed a house (including lot) costing less
than $4,000, but the proportion of such units built
during this period was only 29 percent of the total
single-family construction.
The following table, based upon the acceptance for
insurance by F . H. A. of mortgage loans for new
home construction, provides statistics on the current
trend of unit dwelling costs and shows clearly that
we are still shooting wide of the vast housing market
for home properties costing $4,000 and less. Some
encouragement is found in the $350 reduction of the
average cost of 1-family homes according to U. S.
Department of Labor building-permit figures for
1938, indicating an attempt to build for the wider
market existing at the lower income levels.
Property valuation (house and lot) of
new single-family homes accepted
for insurance
Less than $5,000
Less than $4,000
Percent of total number Percent of total number
of homes accepted for
of urban faminsurance
ilies needing
in this
Calendar April-June houses
price range
1938
year 1937
39. 6%
19. 5%
40. 6%
17. 8%
69. 7%
51.0%
I35
maintaining an annual average of about one-half of
the total loan volume. I n 1937 savings and loan
If we can assume that the trend toward increased
associations loaned $804,000,000 out of an estimated
residential building continues at the accelerated rate
total of $1,559,000,000, or 51.9 percent. I n the first
evidenced in the last nine months of 1938, the dollar
six months of 1938 the savings and loan share was
volume of residential dwellings built in 1939 will be
$334,000,000 out of an estimated total of $703,000,approximately 50 percent above 1938, or about
000. (This total excludes all mortgage financing
$2,000,000,000. T h e estimated total for 1938 was by individuals, trust departments of banks, and
$1,330,000,000. However, with the present unmiscellaneous lenders.)
settled European conditions and their possible reI t was evident again in 1938, as in former years,
actions in the country, the trends indicated by the
that the number of homes financed by savings and
latter part of 1938 may be seriously interrupted.
loan associations greatly exceeded the aggregate
Analyzing the conditions leading to greatly infinanced by other institutions, since the average size
creased residential building next year, we find a maof a home-mortgage loan written by savings and loan
terial housing need resulting from many lean
associations was $2,200—a decline of over $100 from
years of building; business and industrial improvethe 1937 average. The average size new mortgage
ment with resultant advances in consumer purchasing
DISTRIBUTION OF ESTIMATED INSTITUTIONAL HOME MORTGAGE LENDING
power; and an ample supply of mortgage money at
FIRST 6 MONTHS 1938
the lowest interest rates and for the longest lending
COMMERCIAL BANKS j v
periods in the country's history. Other favorable
INSURANCE COMPANIES
23.1%
^ \
18.9%
influences include increased construction of low-cost
rental housing through the use of private credit and
F . H . A. insurance, and building for low-income
, cr MUTUAL SAVINGS BANKS
groups under the United States Housing Authority;
r**
8.i%
HOME OWNERS' , - * j
LOAN CORPORATION^ \
increased tapping of the market in the $3,000-$4,000
4.6%
price range; and the downward trend of foreclosures.
VTNON-MEMBERS
8.3%
Outstanding among possible unfavorable factors
would be increased building costs; decreased rent
MEMBERS OF FEDERAL
HOME LOAN BANK SYSTEM
levels; the problem of residential overhang; and the
37.0%
unstable condition of international affairs.
written for construction purposes likewise declined
over $100 to approximately $3,200—the smallest
Relative Part Played by Sayings and average size construction loan of any institutional
lender. Recent studies of mortgages recorded
Loan Associations in 1938
throughout the United States, based on reports
Mortgage Lending
received the last three months of 1938 from communities located in almost every State, possessing
•
S U R P R I S I N G was the fact that during the first
approximately one-fifth of the total nonfarm popusix months of 1938 the estimated volume of
lation,
showed that only individual lenders make
home-mortgage loans written by institutional lenders
mortgage
loans of smaller average size. These same
decreased only 11 percent as compared with the
reports
revealed
that in general, life insurance comcorresponding period of 1937—a small reduction in
panies write the largest size loan, followed by comview of the drop in general economic activity.
mercial banks and trust companies. I n size of loan,
During the first six months, savings and loan
mutual savings banks are next in order and are folassociation home-mortgage lending had fallen off
lowed in turn by savings and loan associations.
19 percent b u t picked up rapidly during the last half
Individuals hold the lowest place because of the
of the year and the estimated 1938 volume was only
recording of numerous, miscellaneous small loans
about 12 percent behind the 1937 total.
and second mortgages.
T h a t the drop in savings and loan lending activity
was simply part of the general decline was indicated
FEDERAL HOUSING ADMINISTRATION ACTIVITY
by F . H . L. B . B . estimates of new home-mortgage
A significant development in home-mortgage
lending by private institutional lenders. Savings
lending in 1938 was the expansion of Federal Housand loan associations continued their record for
FORECAST OF 1939
r
136
Federal Home Loan Bank Review
ing Administration activity under the stimulus of
the February amendments to the National Housing
Act. Premium-paying mortgages increased $473,000,000 during 1938, a gain of 11.5 percent over the
$424,000,000 of such business in 1937. For the first
11 months of 1938 F . H. A. reported 4,772 mortgagee
institutions making insured loans during 1938, including 1,036 building and loan associations.
During 1938 mortgage companies greatly increased
their actual and relative shares of F . H. A. business
although commercial banks remained by far the
largest institutional lenders under Title I I . Participation by savings and loan associations in F. H. A.
business was relatively less than in 1937.
Distribution of total amount of gross mortgages accepted for
insurance by F. H. A., by type of institution
[Source: "Insured Mortgage Portfolio," December 1988, p 17]
Percent of total
Type of institution
1937
National banks
_
State banks and trust companies
Total commercial banks
Building and loan associations
Mortgage companies
Insurance companies
Savings banks
_
All others
Total
_
_.
Jan.-Sept.
1938
Net cumulative total
through
Sept. 1938
Percent
28.4
25.3
Percent
29.8
24.0
53.7
14.4
14.2
11.2
2.7
3.8
53.8
10.5
20.0
8.7
2.1
4.9
56 9
13.7
13.7
8.8
2.9
4.0
100.0
100.0
100.0
Percen
30.2
26.7
Other classes of loans were not under the pressure for
expansion caused by the increase in building activity
and hence continued to occupy a smaller and smaller
proportion of the new business of these institutions.
As the recession began in 1937, however, loans for
the building or purchase of homes decreased rapidly
while refinancing and reconditioning loans tended to
continue as usual and gradually constituted a greater
percentage of total funds loaned.
A bright spot in the 1938 lending picture has been
that as the decline in lending volume was checked,
loans for new construction or home purchase have
expanded and in December 1938 savings and loan
associations were lending 63 cents out of every dollar
for the building or purchase of homes—exactly the
same proportion as during the entire year 1937 and
substantially above the 54 cents out of every dollar
used for these purposes in 1936. (The estimated
volume of mortgage loans made by savings and loan
associations is based upon monthly reports received
by the Federal Home Loan Bank Board.)
Construction loans by savings and loan associations amounted to $220,000,000 for the year 1938—
a $14,000,000 or 6-percent decline from the corresponding 1937 period. Total loans by savings and
loan associations during this same time declined by
11 percent, a fact which lends support to the belief
that the increasing volume of construction loans by
CONSTRUCTION LOANS MADE BY ALL SAVINGS AND LOAN ASSOCIATIONS
Property improvement loans, revived under the
amended National Housing Act, were made principally by commercial banks, which financed 81 percent of the total volume during the first six months
of 1938. Savings and loan associations financed approximately 1 percent of the total volume of Title I
notes during this same time.
At the close of 1938 after 10 months of operation,
the Federal National Mortgage Association, owned
and controlled by the R. F . C , had purchased over
20,000 insured mortgages amounting to almost
$82,000,000. I t was committed to buy an additional 4,000 of a value of $16,000,000.
ANALYSIS OF 1938
LENDING BY SAVINGS AND LOAN
ASSOCIATIONS
The increase in lending activity of savings and
loan associations in 1936 and 1937 must be attributed
almost exclusively to the greater volume of loans
for the acquisition of homes by prospective owners,
either through construction or purchase loans.
Fzbruary 1939
122746-—39-
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—-p*.,j
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/
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1 1
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i
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(..•••
: . . . . . •
"vF* 936
1 -••
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AUG
SEPT.
OCT.
savings and loan institutions during the latter half
of 1938 is an indicator of markedly increased lending
volume during 1939. I t is significant that in every
month from August 1938 through December, more
new construction mortgages were written than in
the same months of 1937. From January through
July 1938, lending activity for the building of new
homes had been below the same period of 1937.
The following table summarizes new loans made
by all savings and loan associations classified by pur137
pose for the full year of 1938 as compared with 1937
and 1936:
Purpose of loan
Number of cents out of every dollar
loaned in—
19Sfi
1937
19S8
Construction
Home purchase
Refinancing
Reconditioning
Other purposes
$0.24
.30
.23
.09
.14
$0.26
.37
.20
.07
.10
$0.28
.33
.20
.07
.12
1. 00
1. 00
1. 00
The decline in savings and loan lending activity in
1938 was not shared equally by all classes of associations. Total loans of all savings and loan associations declined 11 percent during the January-December period. The corresponding decline for Federal
associations was 7 percent, for State members 12
percent, and for nonmembers 15 percent.
MORTGAGE-LENDING POLICIES IN
1938
Three tendencies were outstanding in mortgagelending policies during 1938: toward longer term
loans, toward higher percentages of appraised value,
and toward lower interest rates.
Although complete statistics on all mortgage lending are not available, an indication of the extension of
loan terms is found in an analysis by F. H. A. of its
premium-paying mortgages. During 1937 the average terms granted by each type of lending institution
were longer than in 1936. Those savings and loan
associations making insured loans raised their average mortgage term by six months as indicated in the
following table:
Average duration of Federal Housing Administration mortgages
insured {1936 and 1937)
[Source: "Insured Mortgage Portfolio,*' July 1938, p.19]
New home
Existing home
All mortgages
Type of lending institution
1936
1937
1936
1937
1936
1937
Savings and loan associa- Yr. mo. Yr. mo. Yr. mo. Yr. mo. Yr. mo. Yr. mo.
tions
.
16 4
16 4
16 9
17 3
18 1
18 5
All types
16 2
16 5
17 1
17 9
18 4
16 6
Notable also was the greater uniformity of loan
terms among the different types of lending institutions. The greatest spread between the average of
the different lending institutions in 1937 was only
16 months with the emphasis clearly on even greater
uniformity. Increasing concentration of insured
mortgages are found in the 19- to 20-year and 15- to
16-year groups. (58 percent of all mortgages in138
sured were classed in the 19- to 20-year group in
1937 as compared with 50 percent in 1936.)
Exact figures are not yet available for 1938, b u t
it is believed that the trend towards longer term
loans, which was evident in 1936 and 1937, was
accelerated by the amendments to the National
Housing Act permitting the insurance of certain
restricted types of mortgages for terms up to 25 years.
These same amendments have also played a large
part in revising upward the average lending institution's concept of the percentage of appraised value
which may be loaned on new home property. Based
on a survey of mortgages accepted on new homes
from April through June 1938, F . H. A. found
that two out of every three new home loans accepted
for insurance fell into the new high ratio range of 80
to 90 percent of appraised value and that one out of
every two new home mortgages accepted was within
four percentage points of the 90-percent maximum
permitted—a distinct upward shift from 1937.
PROGRESS TOWARD G R E A T E R NEIGHBORHOOD
STABILITY D U R I N G
1938
The emphasis upon higher ratio and longer term
loans during 1938 prompted many a lending institution to make more diligent inquiries than usual into
neighborhood trends and prospects for neighborhood
stability in granting its loans. City surveys conducted by the Division of Research and Statistics
show that two-thirds of the average city are threatened with blight. In recent years mortgage-lending
institutions have come to realize that a primary
problem of cities of all sizes—how to rezone and
replan to check urban blight and tax delinquency—is
also a problem seriously affecting their own interests.
During 1938 there were signs of progress towards
better planning control throughout the country.
Chicago completed a land use survey and city officials
declared that sensible rezoning of the city and
development of adequate plans for rehabilitating
blighted areas were fundamental to Chicago's welfare. The city of Memphis became one of the first
cities to undertake a complete revision of the present
city plan, when it called in an experienced consultant to develop a practical procedure for
rehabilitation of blighted city areas.
General approval was given the initiation of a trial
neighborhood rehabilitation program, sponsored by
the Baltimore Housing Authority and backed by the
H. O. L. C , the United States Housing Authority,
and the Works Progress Administration, in Waverly,
Federal Home Loan Bank Review
one of Baltimore's old residential subdivisions.
There are many fine homes in this community of 1,600
residential properties and values are essentially
sound although threatened in recent years by the
encroachment of slums, the deterioration of a comparatively few houses within the district itself, and
negligence in providing civic improvements. I t is
hoped that through rehabilitation of the area home
owners and the EL O. L. C. will benefit by increased
property values, mortgages will be made more
secure, sounder tax values will be obtained, and
future slums avoided. Lending institutions hope
that the success of such a trial program will permit
its development in other urban areas.
How great the need is for local planning bodies,
actively operating under adequate budgets, was
shown by the study of the New Jersey Planning
Board of existing practices in subdividing land. In
this State alone there are enough vacant lots to
accommodate an additional 4,000,000 people. Approximately 60 percent of the land subdivided is
entirely unoccupied with nearly 185,000 acres—
sufficient to supply more than one million 50 by 120
foot lots—vacant. One-third of this acreage has
been plotted since 1915. The result has been the
development of phantom towns, where now are left
only a few vacant houses, miles of fast-disappearing
dirt streets, and some thousands of worthless deeds.
Other signs of progress in 1938: National Resources Committee organized a local planning committee which will devote special attention to the
progress of local planning, and prepare recommendations and proposals concerning appropriate relationships between Federal, State, and local agencies.
Purdue University held its first planning school, and
a number of universities opened new planning departments. Many of the annual reports of American
cities carried in 1938 for the first time good accounts
of activities and progress in planning and zoning.
General Real Estate Conditions
•
ALTHOUGH the average monthly sales of real
estate were below those of 1937, the chart of real
estate activity on the next page indicates its parallel
with general business conditions. Some improve-
Wisconsin Test Case Withdrawn From Supreme Court Docket
•
The United States Supreme Court on January 16, 1939, upon the motion of the Attorney
General and the members of the Banking Commission of the State of Wisconsin, dismissed the
writ of certiorari to the United States Circuit Court of Appeals for the Seventh Circuit in the case
of Loomis et al. v. First Federal Savings and Loan Association of Wisconsin (No. 277, U. S. S. C ,
October Term, 1938). The Attorney General and the members of the Banking Commission had
petitioned the United States Supreme Court to reverse the decision of the United States Circuit
Court of Appeals (Seventh Circuit) of May 20, 1938, which affirmed the decision of the District
Court of the United States for the Western District of Wisconsin enjoining such officers of the State
of Wisconsin from interfering with the transaction of business in Wisconsin by the First Federal
Savings and Loan Association of Wisconsin. Such decision had upheld the constitutionality of the
provisions of Home Owners 7 Loan Act of 1933 providing for the chartering of Federal savings and
loan associations.
The case originated when the First Federal Savings and Loan Association of Wisconsin, located
in Milwaukee, filed a bill of complaint in the District Court of the United States and obtained the
injunction and ruling as to constitutionality above mentioned. The Attorney General and the
members of the Banking Commission of Wisconsin contended that the First Federal Savings and
Loan Association of Wisconsin was usurping a corporate franchise which only the State of Wisconsin
had the power to grant, and that the provisions of Home Owners' Loan Act of 1933, under which a
Federal corporate charter was granted to the association, were unconstitutional.
With such dismissal of the writ of certiorari, the decision of the United States Circuit Court of
Appeals for the Seventh Circuit, upholding the constitutionality of the chartering of Federal savings
and loan associations, becomes final.
February 1939
139
REAL ESTATE SALES ACTIVITY IN THE UNITED STATES
1926°100
IA*T^
^V - i
\
DEC i«3«
\
OEC 193/
- ^ T
54.8'
54.0
51.8
i
\
1
^
5
A
5
t;
1
g
Source: National Association Of Real
,1
. 1
. 1
1 , 1
Estate
1
Boards
!
1926 1927 1928 1929 1930 1931 1932 1933 1934 1935 1936 1937 1938
ment in the reduction of institutionally owned real
estate has been made during the last two years.
The "Real Estate Owned'' account of Federal
Reserve member banks, the bulk of which is residential property, shrank 2 percent during the first nine
months of 1938, reflecting a decline in their portion
of the "overhang".
Savings and loan associations in 1937 reduced
their owned residential real estate 11 percent
($130,000,000), and preliminary reports indicate
that further reductions were accomplished during
1938. The table below, which contains figures
from an identical group of 1,736 insured associations,
assumes added significance in view of the real estate
improvement during the last half of the year.
Although there was a slight increase in the real
estate owned by insurance companies during 1938,
their other assets increased so substantially that the
ratio of real estate owned to total assets was lowered
for the second successive year.
Any reduction in the volume of this residential
"overhang" is an encouraging factor in general real
estate conditions. The existence of a large amount
of real estate awaiting sale has a depressing effect
upon the general market for houses, as well as the
construction of new homes. Also, it is influential in
causing a price differentiation between used houses
and new ones, which according to the National
Association of Real Estate Boards is now larger than
we have ever seen.
The story of five consecutive years of declining
foreclosure rates on nonfarm dwellings is probably
the brightest spot in the real estate picture. Foreclosures during 1938 were 22 percent less than 1937
TREND OF NON-FARM FORECLOSURE BY SIZE OF COMMUNITY
Real estate owned by an identical group of associations
[Amounts are shown in thousands of dollars]
LEGEND
Type of association
Federal-_•
State-chartered
Total
Number
of associations
June
1938
Decem- Percent
ber
change
1937
1,298 $91, 236 $91, 680
438 65, 853 67, 649
-0.5
-2.7
1,736 157, 089 159, 329
-1.4
OWNED REAL ESTATE
AS A PERCENT OF TOTAL ASSETS; 1930-1937
(BASED ON A L L S. S L. ASSOCIATIONS)
140
I Metropolitan Area
I Heavily Urban
ESS3 Lightly
EHIJ Rural
Urban
and 50 percent under 1934. In fact, every month
in 1938 was an improvement over the previous year.
Geographically, every Federal Home Loan Bank
District and all but seven States bettered their
1937 nonfarm foreclosure rates. Distribution of
the percentage of total foreclosures, and the rate
of cases per 1,000 dwellings varied in direct proportion to the number of nonfarm dwellings in each
county: the larger the county, the higher percentage
of total cases, and higher the rate per 1,000 dwellings.
Two interrelated factors of importance when considering general real estate conditions are the level
of rents and the number of vacancies in existing properties. The chart of occupied dwelling rentals as
compared with the N. I. C. B. index (which is more
sensitive to the effect of rental levels of newly
tenanted structures) appears on the facing page and
pictures the steady downward trend of the latter
during 1938.
Federal Home Loan Bank Review
INDEXES
OF RESIDENTIAL
1926 = 100
Comparisons of 1988 and 1987 average adjusted tax rates of 2^8
American cities
RENTALS
[Source: National Municipal Review, December 1938, p . 5971
***•• *••.,
""•••jN
V. LCt
^X
U.S.
^DEPT. OF LABOR
'v\
-••—
/
1927
1929
1930
1931
1932
1933
1934
1935
1936
J~~~. V W - W
1937
1938
Keeping in mind that vacancies are peculiarly
subject to local conditions, the Department of Commerce estimated that residential vacancies increased
slightly during the first half of 1938, reversing a
5-year trend. Figures of the National Association
of Real Estate Boards indicate that there is an undersupply of 1-family dwellings in 34 percent of 274
reporting cities, despite the revival of home building,
and the doubling-up of families during the recession.
December real estate bond prices were 1.8 percent
above the corresponding month of 1937. This compares favorably with a decline of 26.4 percent between
the Decembers of 1936 and 1937.
Stressed in the annual report of the Board as one
of the chief obstacles to a spirited construction recovery, some progress was made in 1938 toward a more
equitable taxation of real estate. November elections revealed concerted efforts on the part of voters
to resist further tax-rate increases. At least nine
States are now using an over-all limit on the levy to
spread the tax base, and to restrict easy sources of
taxable funds for unlimited spending.
Progress in the spread of homestead tax exemption
received somewhat of a setback in the States of
Arizona, California, and Missouri when voters
rejected various proposals of this nature. The
movement continues to grow, however, and there
are now 14 States which have provided for the
exemption of homesteads under varying limitations.
During 1938, homestead tax exemption laws became
effective in five States: Alabama, Arkansas, Georgia,
Minnesota, and Mississippi. I n addition, the electorate of the State of Louisiana, as an inducement
to new construction, adopted a constitutional
amendment exempting from all taxes for three years
new homes built since January 1, 1938.
The following table shows that the average tax
February 1939
1938
1937
500,000 and over
300,000 to 500,000
100,000 to 300,000
50,000 to 100,000
30,000 to 50,000
$28. 67
29.68
27.22
25.83
25.75
$28. 39
27.98
26.50
25.06
25.31
$0. 28
1. 70
.72
.77
.44
Total
26.49
25.84
. 65
M
^o>n ..»*'
1926
Population group
Average adjusted rates per
$1,000 assessed value
Increase
rates (adjusted to be comparable) of 248 cities increased slightly during 1938. A nominal rise in
assessed valuations marked the third year urban
property values have remained virtually unchanged.
Private Savings in 1938
•
T H E financing of the homes in this country has
always been carried on primarily as the result of a
flow of savings from individuals to institutions and
then to other individuals needing the loan of funds
upon mortgage security. In 1938 the rate of flow of
individual savings into the various types of institutions and investments varied greatly, as Table A on
the following page indicates.
A most pronounced increase in savings during 1938
was shown by the cash value of sales of United
States Savings Bonds. The increase in the demand
for Baby Bonds is evidenced by their resistance to
redemption and by the $72,000,000 increase in the
volume of actual sales in 1938 as compared to 1937.
The 48-percent increase (see Table A) in the savings
represented by Baby Bonds during 1938 was by far
the largest percentage increase recorded in any of
these media of long-term savings. Time deposits of
individuals, partnerships, and corporations in all
member banks of the Federal Reserve System showed
a decline of $17,000,000 during the first nine months
of 1938, which is in direct contrast to the trend shown
by time deposits during 1937. Demand deposits in
Federal Reserve Bank members during the first nine
months of 1938 increased 3.5 percent ($691,000,000).
Postal Savings have shown relatively little change
during the past three years and at the end of 1938
showed a decrease of $18,000,000 in the outstanding
total from December 31, 1937.
I4I
Table A.—Trend of selected individual long-term savings, 1938
[Amounts are shown in millions of dollars]
Latest
available
date in
1938
U. S. Savings Bonds *
Postal Savings
Mutual savings banks
All member banks of Federal Reserve 3System 2
Federal savings and loan associations
__.
1
2
8
$1, 404
1,252
10, 235
10, 789
860
Dec. 31,
1937
$948
1,270
10, 126
10, 806
674
Increase
or decrease
(-)
$456
-18
109
-17
186
Percentage increase or
decrease (—) during
1938
Percent
48.0
-1.4
1. 1
-0.2
28.0
1937
Percent
81.0
0.8
1.1
3.6
41.0
Cumulative cash value, less redemptions.
Time deposits evidenced by savings passbooks, certificates of deposit, open accounts, and Christmas savings or similar accounts.
Private repurchasable capital: Includes growth due to net gain of 43 in number of Federal associations.
From the point of view of savings and loan operation, an outstanding feature of 1938 was the continued high rate of increase in the private repurchasable capital of Federal savings and loan associations.
During 1938 private repurchasable capital in all
Federal associations increased 28 percent, from
$674,000,000 to $860,000,000. This growth, however, includes that private capital which was gained
through conversion of State-chartered associations.
Eliminating the effect of changes in the membership
list by studying a comparable group of Federal
associations from month to month, it was found that
the increase in private repurchasable capital was 20
percent for 1938—a rate of increase greater than the
1937 rate. The rate of increase slowed down slightly
in the second half of 1937, but during the first six
months of 1938 private investments increased
rapidly at a rate exceeding that of the corresponding
period of 1937, despite the unfavorable economic
conditions and the reduced family income in 1938.
During the past eight years there has been a substantial growth in the amount of money in circulation,
in contrast to the tendency during the decade ending
in 1930 when the general level of currency in circulation showed little change, since in this period there
was a growth in the use of bank checks for making
payments. From 1936 up to the present time we
have been maintaining currency in circulation at a
level over $2,000,000,000 above the $4,476,000,000
level of 1929. The increase in the amount of large
bills in circulation reflects in part "the holding of
savings in the form of currency rather than in bank
deposits,securities, or other property", according to the
Federal Reserve Bulletin which believes that the banking difficulties in the early 1930's are partly responsible and that another factor is the reduction in interest
142
rates paid on savings and other time deposits.
Whatever the causes, the facts are t h a t money in
circulation has increased nearly 50 percent since
1930, and that large denomination currency in circulation has more than doubled. There was a pronounced increase in the amount of large bills outstanding in 1935 and 1936 but very little change in
1937. During 1938, however, the amount of large
denomination currency in circulation increased by
$172,000,000.
One reason for increased holdings of large denomination currency as savings is that the determining
factor in the money market at the present time is the
pressure of surplus funds, and individuals, like
financial institutions, find it hard to obtain a safe
investment at a rate of return at all comparable to
investment yields of earlier years. Since February 1,
1935, the maximum rate of interest which member
banks of the Federal Reserve System have been permitted to pay on savings deposits has been 2% percent, and in many sections of the country commercial
banks are paying an interest rate substantially below
the maximum authorized level. United States Savings Bonds, if held for 10 years to maturity, return
a maximum of 2.9 percent. The interest paid on
Postal Savings deposits is a flat 2 percent. Many
legal reserve life insurance companies have already
announced that effective in the early months of 1939
there will be a reduction in the return guaranteed on
new policies from 3 percent to 2.5 percent. Dividend rates of savings and loan associations have been
affected by these general influences on the money
market. A study of the average annual weighted
dividend rates of Federal savings and loan associations shows a reduction from 3.69 percent to 3.48
percent during the years 1935 through 1937.
Federal Home Loan Bank Review
Savings and Loan Associations Place
Increased Emphasis Upon Public
Relations Durins 1938
•
W I T H the passing of each year it is more evident
that the business and commercial world is
becoming "consumer-conscious". The principle of
public relations is being widely accepted by savings
and loan associations as a factor in successful business
operation. Virtually every gathering of institutional
officialdom during 1938 discussed some of its phases:
the association's office building, popular presentation
of its balance sheet, and its budget for advertising.
Constant personal contact with investor and borrower is an important part of the routine in savings
and loan associations. The psychological effect of
the surroundings in which these transactions take
place has too frequently been overlooked, for the
office of an association is in itself an advertisement
of the organization's character. To be located near
a center of commercial activity is a desirable requisite.
Where feasible, the consensus holds that it should be
situated on the ground floor for the convenience of
its patrons. An attractive interior and exterior add
to its favorable impression upon the public mind.
Consistent with the experience of other types of
corporate enterprise which have revised the form of
their reports to the public is that of savings and loan
associations which have re-written their statements
of condition in understandable terms and found that
the confidence of their investors has been increased.
The extension of this practice has been clearly demonstrated in 1938 year-end statements which have
reached the office of the R E V I E W .
Four trends are indicated in their preparation, in
addition to the revision in terminology: (1) a more
complete analysis of mortgage loans; (2) additional
emphasis upon the "community-cooperation" aspect
of the savings and loan industry, and the mutuality
under which each investor shares equally in resources
and earnings; (3) supplemental year-to-year comparisons of major balance sheet items as an indication of the progress of the association; and (4) use
of a simplified statement of income and expense,
together with a reconcilement of the undivided
profits account to show the distribution of earnings.
"Convention Spotlights Advertising" is the headline of the article in the official publication of the
United States Building and Loan League recording
its annual convention in Chicago. I t is indicative
February 1939
of the thought of leaders in the savings and loan
field throughout the year. Advertising is one of the
prime factors in promoting public relations, and
aggresive associations are vitally interested in using
the most productive advertising media and in measuring accurately the effectiveness of their campaigns.
"How much should our association spend for advertising?" is a query which may be answered only
through a careful study of the financial condition
and possibilities for growth of every institution. An
important study by the Federal Home Loan Bank
Board's Department of Public Relations showed that
271 of the most successful insured associations
actually spent an average of 2.8 percent of their gross
income for advertising. Their favorite media in
order of preference were newspapers first, followed
by printed material, radio, billboards, and window
displays.
A provocative question raised by the survey: If
the often suggested norm of one-quarter of 1 percent
had been applied to the average assets of the 271
associations studied by the Board, what would their
advertising expenditures have been during 1937?
The result would have been advertising expenditures
of 5 percent of the gross income of these associations,
practically doubling their actual aggregate advertising expenditures for that year.
Cooperative advertising programs were numerous
throughout the year and culminated in the "Middlemen's Campaign" sponsored by the United
States Building and Loan League and directed
toward the building industry trade journals. Important proposals by many associations for the year
1939 included a study of the market in their communities, a definite place allotted to advertising in
the association's budget, and initiation or expansion
of a plan of tracing and recording results from the
association's various advertising activities.
HOW THE ADVERTISING DOLLAR WAS SPENT IN 1937
<EACH
OJSC
REPRESENTS
ONE
CENT)
Forecast for 1939
•
T H E year 1939—a decade following the peak
of our previous period of prosperity—dawns with
possibilities for a far better year than we have
experienced recently. The upward trend of the
last half of 1938 is perhaps the best indication of
this, for recoveries, like depressions, have a cumulative nature which accelerate their movement when
once started.
In the Presidential message on the State of the
Union addressed to the opening session of Congress,
predictions were made to include a national income
in the neighborhood of 80 billion dollars. " T h a t is
by no means an excessive aspiration", according to
the January 15, Cleveland Trust Bulletin which is
generally conceded to express the views of Col.
Leonard P. Ayres, Vice-President, and noted American economist. "We had a national income of about
80 billions in 1929, and now we have nine million
more people in our population than we had then.
In order to have a national income of 80 billion
dollars we should have to do about five-fourths as
much business as we did in 1937, and that ought not
to be too difficult an achievement."
Other forecasters, however, agree that a national
income about equal to that of 1937 ($69,000,000,000)
is highly probable. I t is quite likely that a new high
for the recovery period will be established.
Any improvement in general business conditions
will be reflected in increased national income.
There are several favorable signs which foretell a
continued revival of economic activity. The excess
reserves of commercial banks are more than adequate
to meet business needs, and interest rates are at unprecedented low levels. The inventories of current
goods are considerably lower than they were at the
beginning of 1938, and wholesale prices have been
relatively stable during the last half of the year.
Retail sales, shown to be above 1937 levels at the
close of the year, are expected to benefit from any
increase in national income.
Savings and loan associations will take particular
interest in a statement by Mr. A. D . Whiteside,
president of Dun & Bradstreet, Inc., who has this to
say about the opening of 1939, ". . . but probably
the most important single factor which may serve
as the broad supporting base for a period of prosperity
is the evidence that construction throughout this
country of every nature, including the renovation of
urban structures, is shaping up as it has not done
for more than a decade".
144
Although we have discussed the prospects for residential building during 1939 at some length earlier
in this article, its significance from the standpoint of
the likely effect upon home-financing institutions is
worthy of added emphasis. A prominent increase in
construction activity will result in a corresponding
larger amount of home-mortgage lending. In view
of the fact that construction loans made by savings
and loans declined approximately 6 percent in 1938,
if home building lives up to expectations, the coming
year should witness a sharp increase in this, an
important phase of savings and loan operations.
Sectional opinion as to the percentage increases of
1939 residential building volume compared with 1938
has been gathered by Architectural Forum, as follows:
Boston (up), Chicago (45), Cleveland (35), Detroit
(40), Houston (15), Kansas City (20), Los Angeles
(20), Louisville (15), Miami (10), New Orleans (85),
New York (15), Philadelphia (35), San Francisco
(15), Seattle (35), and Washington (20). Twothirds of the 212 cities surveyed by the National
Association of Real Estate Boards expected a greater
volume of home building in the new year, indicating
the universality of the anticipated increases.
Improvement in business conditions will also enlarge the demand for home purchase and reconditioning loans. Opportunities for an increased volume
of mortgage lending, however, have emphasized fundamental changes in loan policies and have made it
increasingly evident to savings and loan managers
that a more analytical approach is necessary for
sound lending today.
We have seen a very substantial extension of the
periods for which loans are made, a marked increase
in the percentage of the loans to assessed valuation
and in many instances, due to the lowering of interest
rates, a very marked reduction of the spread between
cost of money plus overhead, and interest charged.
All of these factors have required and will continue
to require improved technique and better management if mortgage-lending institutions are to meet the
mortgage requirements of the next few years at
a profit.
Best indications are that mortgage lenders in 1939
will pay increasing attention to the need for better
information. Extension of the mortgage-recording
data coverage by the Division of Research and Statistics of the Federal Home Loan Bank Board with the
cooperation of mortgage lenders is one example of
this development. Another indication is the growing recognition of the value of "security area maps",
(Continued on p. 167)
Federal Home Loan Bank Review
« « « FROM THE MONTH'S NEWS » » »
Real estate in the average American city during 1939
Building forecast: 1939.
Median City's volume of sales decidedly higher than in 1938, about 10
percent. Prices for residential property—some of it—15 percent higher.
But a price differential beginning to be very visible between used houses
and new. . . . Apartment situation beginning to be affected by
private building under F. H. A. rental housing and large-scale housing
insurance. Biggest single influence on construction totals and rent
levels, however, is the local U. S. H. A. building scheduled to become
reality this year. . . . Vacant lots in greatest demand since 1929. . . .
Home building really beginning to go places. Definitely better than
last year. . . . Liquidation of repossessed properties passed beyond
the center of the stage. . . . Mortgage money plentiful. Interest
rates low. The low rates a shade more generally available. A feeling
in Median City that rates are beginning to be pretty well stabilized. . . .
Taxes actually about the same as in 1938, but a fear in the air that they
are going higher. Worry over unequitable assessments, especially for
downtown properties.
With the possible exception of
material costs and labor wages, all
of the factors are presently bullish
for building. . . . There is,
however, one factor which tends
to tone down this optimism—the
possibility of another large-scale
war threat such as gripped the
world last fall. . . . Actual war
or the threat of it would overnight
change public opinion, kick all
forecasts for 1939 into a cocked
hat. . . . The Architectural Forum
concludes residential construction
will advance 30 percent over 1938;
total construction, over 20 percent.
First forecast by real estate boards ever made.
Survey of 274. cities by National Association of
Real Estate Boards. Freehold, Jan. 1, 1939.
Each January I have selected
the industry I felt had the most
promising outlook for the coming
12 months. . . . Building creates
jobs in 26 separate businesses, and
indirectly it makes work in hundreds of others. . . . A heavy
volume of building is the keystone
of general prosperity. . . . Today
for the first time in 20 years, the
building cycle and the business
cycle are moving ahead together.
This is why I am bullish on 1939
building and why I am picking
building as the "industry of the
year".
Roger W. Babson, noted statistician
and financial adviser.
A definitely bright prospect for
all building fields during 1939.
. . . An increase of 40 to 60 percent in residential building during
1939 as compared with 1938. . . .
An increase of 25 to 50 percent in
all types of building for the country at large.
Roy T. Wenzlick, President, Real
Estate Analysts.
1939 looks good. . . . The nearest thing we have had to the
1920's. . . . More money invested and more calls for loans will combine to make the associations grow. . . . There will be a definitely
decreased percentage of real estate owned. . . . As I see it, probably
a third more dwelling units will be^built this year than last. . . .
There will be more small, unpretentious new houses than America has
ever built before. . . . This is likely to be an advertising year of great
moment.
Clarence T. Rice, President, United States
Building and Loan League.
It appears likely that residential building in 1939 will be substantially
larger than it has been during the past^three^years, possibly by as much
as 40 percent. This appears to be likely in view of the low vacancies,
recent increases in family income, and the substantial increments in
the number of families each year.
Lowell J. Chawner, Chief, Division of Economic Research, U. S. Department of Commerce.
It now seems wholly probable that unless some international calamity
intervenes, 1939 will be a definitely better business year than 1938
has been. . . . The coming year now promises to be a period of better
employment, rising national income, and increased volume of industrial
production. . . . Building construction is advancing, and the volume
of privately financed building will almost surely be greater next year
than it has been in this one.
The Cleveland Trust Company, Business
Bulletin, Dec. 15,1938.
145
February 1939
122746—39
Architectural Forum, January 19S9.
3
SUMMARY OF RESIDENTIAL CONSTRUCTION
AND HOME-FINANCING ACTIVITY
I. December was the only month during 193S in which the mortgage-lending activity of savings and loan associations exceeded the
corresponding perio d of 1937.
A. Total loan volume was almost unchanged from November in contrast to usual downward movement during winter months.
B. Districts in Southwest and Far West—Little Rock, Topeka, Portland, and Los Angeles,—together with the Indianapolis District
showed improvement over the November volume of loans.
II. Foreclosure rates resumed their 5-year downward trend after November interruption. Volume of cases only one-third that of December
1934.
III. Wholesale and dealer prices for building materials showed mixed trend.
A. Combined wholesale building material price index increased slightly in December.
B. Dealers' prices for materials in the standard house declined fractionally during December, although the tendency for these
prices to level off will bear watching.
C. Labor costs were unchanged for the second successive month.
IV. The seasonally adjusted index of residential construction climbed to the highest levels since 1929, although the total construction in
December was less than November totals.
A. Six Federal Home Loan Bank Districts more than doubled their building-permit activity as compared with the closing month
of 1937.
B. All Bank Districts, with the exception of New York, reported less construction activity per 100,000 population than in November—a usual seasonal reaction.
V. Purchasing power, as indicated by industrial production, pay rolls, and employment, continued to reflect the improvement of general
business conditions.
RESIDENTIAL BUILDING ACTIVITY AND SELECTED INFLUENCING FACTORS
1926 « 100
146
Federal Home Loan Bank Review
RESIDENTIAL CONSTRUCTION and HOME-FINANCING ACTIVITY
•
DECEMBER 1938 was in general a favorable
month insofar as real estate and home-financing
conditions were concerned. Although a decline in
the total volume of residential building was recorded
from November, this decline was not as great as is
normally reflected during the early winier months.
The index of residential construction, which has
been adjusted for usual seasonal variation, increased
in December to the highest level of any month since
1929. Rising trends in residential construction during the 1938 months brought the index at the end
of the year to more than double the December 1937
index.
Foreclosure activity in metropolitan centers eased
off in December after a temporary November interruption of the 5-year downward trend. Foreclosures
for 1938 in those counties in which at least one city
of 100,000 population or over is located were 20 percent below those of 1937 and were about 10 percent
below those for 1928. In the later months of 1938
foreclosures averaged only about one-third the vol-
ume recorded during the closing months of 1934. Of
the 82 reporting communities, 39 showed decreases
and 39 increases, while 4 indicated no change in
foreclosure activity.
The United States Department of Labor reported
increases in the wholesale price of lumber and paint
materials in December compared with November;
both of these groups have risen fairly consistently
from the June 1938 low level. Combined wholesale
building material prices increased slightly in December.
Dealers' prices for materials used in constructing
a standard 6-room frame house continued in December the downward trend of the past 16 months,
although the tendency during the later months of
the year was for material costs to level off. December labor costs were unchanged from November.
Purchasing power of factory workers, as indicated
by indexes of industrial production, pay rolls, and employment, increased in December, thus continuing the
favorable trends described on page 133 of this issue.
ESTIMATED NUMBER AND COST OF FAMILY DWELLING UNITS PROVIDED
IN ALL CITIES OF 10,000 OR MORE POPULATION
(Source: Federal Home Loan Bank Board. Compiled from residential building permits reported to U. S. Dept. of Labor)
NUMBER OF UNITS PROVIDED
COST OF UNITS
30:
30
28
28
26
26
2 4]
24
1
ff38
22
22
20
(20
110
110
100
100
90
90
1937
rf
20
18
18
1937
16
16
14
14
12
12
80
7T
v>
1 1
1
10
10
50
40
1 7J/-J5 AVG.
"t
8
+ *"
6
•
2
•
~\j
T
8
•"•••
70
1
/l
50
m£
40
30
20
N
0
February 1939
r^~
1931-31 \AVG.
4
2
60
^S
6
- - - - - " ^**
X
80
70
60
4
PROVIDED
120
10
*^ — /
/
^
— . ^
^
J 1
. M l ~N
30
20
Federail- tame I.oon Bank Bo-ord
0
1
J.....J
147
[1926=100]
Residential construction *
Foreclosures (metro, cities)
Rental index (N. I. C. B.)
Building material prices
Manufacturing employment
Manufacturing pay rolls
Average wage per employee
Dec.
1938
Nov.
1938
43.2
151.0
85.1
89.4
89.6
83.1
92.7
35.5
155.0
85.3
89.2
89.0
80.7
90.7
Percent] Dec.
change 1937
+21.7
-2.6
-0.2
+0.2
+0.7
+3.0
+2.2
20.6
182.0
87.5
92.5
93.0
80.8
86.9
Percent
change
+109.7
-17.0
-2.7
-3.4
-3.7
+2.8
+6.7
i Corrected for normal seasonal variations.
December was the first month in 1938 to show
greater mortgage-lending activity by savings and loan
associations than the corresponding 1937 month, and
continued the increasingly favorable trend recorded
during each month in the latter half of 1938. The
volume of loans made in December was practically
unchanged from November, although there is usually
a downward movement at the beginning of winter.
Resistance to normal seasonal declines in lending
activity at the close of 1938 was due largely to
improved real estate conditions which raised construction loan volume substantially above that of
late 1937. Home purchase and refinancing loans
increased somewhat in December over the same
month of the preceding year. Federals and Statechartered members have each shared in the current
rise in lending volume, with Federals making the
better showing.
December improvement over November in lending
activity was concentrated in Districts located in the
Southwest and Far West—Little Rock (No. 9),
Topeka (No. 10), Portland (No. 11) and Los Angeles
(No. 12)—with the Indianapolis District (No. 6) also
showing a slight increase over the total for November.
Lending activity for December was higher than in the
same month of 1937 in 8 of the 12 Federal Home
Loan Bank Districts.
Current operating statistics of comparable reporting Federal and insured State-chartered institutions
revealed similar November to December trends:
unusual gains in private capital, increased borrowings,
and accelerated lending activity in construction, purchase, and refinancing loans.
Residential Construction
CONSTRUCTION of single-family homes in all
communities of 10,000 population or over was
substantially greater in December 1938 than in the
same month of 1937, while the building of apartment
units declined. Table 1, on page 154, indicates that
for every 10 single-family units constructed in December 1937, 14 were built during the closing month of
1938, although similar comparisons showed only four
2-family and eight multifamily units were provided
for every 10 in 1937.
Table 2, page 154, presents a comparison of
December 1938 and December 1937 building activity
as indicated by the number and estimated cost of
new family dwelling units, by States within their
respective Federal Home Loan Bank Districts.
In New York where the inception of a new building
code inflated the December 1937 building-permit
data, a sharp drop occurred to the same month of
1938; only five other States registered declines in
construction totals over this period. The Pittsburgh, Winston-Salem, Indianapolis, Chicago, Des
Moines, and Los Angeles Districts more than doubled
their volume of building-permit activity in December
1938 as compared with the corresponding month of
1937.
Rates of residential construction, as shown in the
chart on page 157, declined from November in each
of the Federal Home Loan Bank Districts with the
exception of New York, where a fractional increase
was recorded. The Los Angeles District had the
highest rate of any of the areas, and was followed by
the New York, Little Rock, and Winston-Salem
Districts. The rate in the Chicago District, which
has almost consistently built fewer residential units
per 100,000 population than any other area, continued down in December to a rate of only 6 as compared with the high rate of 66 in the Los Angeles
District; Boston and Cincinnati Districts also had
rates indicating less than 10 dwelling units per
100,000 population.
Small-House Building Costs
[Table 8]
•
E A C H of the five reporting cities in the Indianapolis District (Evansville, Indianapolis, South
Bend, Detroit, and Grand Rapids) reported increases
in building costs from the third-quarter to the end
of the year (Table 3, page 156). This group of cities
had leveled off in the preceding quarter from the
downward trend started in 1937. Of the total 23
•
148
Construction costs for the standard house
[1936=100]
Material
Labor
Total
Dec.
1938
Nov. 1938
Percent
change
Dec. 1937
Percent
change
103. 1
112.1
103. 2
112.1
- 0. 1
0.0
108. 1
111.0
- 4. 6
+1.0
106. 1
106. 1
0. 0
109. 1
- 2. 7
Federal Home Loan Bank Review
cities reporting in January 1939 as well as in October
1938, only 5 showed declines of over $100 and 3 remained practically stationary.
Mortgage-Lending Activity of Savings
and Loan Associations
[Tables 4 and 5]
•
TOTAL loans for the year declined in every Bank
District with the exception of Little Rock where
Federals and State members registered significant
rises. Greatest percentage decline in loan volume
occurred in the Cincinnati District (27 percent)
followed by Portland with a drop of 17 percent. For
the United States as a whole, loan volume of each
class of institution (Federal, State-member, and
nonmember) declined, as indicated by yearly totals
in Table 4, page 158. Federal associations increased
in annual volume of lending activity in the New
York, Pittsburgh, and Little Rock Districts; loan
volume of State members increased in the Des
Moines, Little Rock, and Los Angeles Districts; nonmembers had greater 1938 activity in the WinstonSalem, Portland, and Los Angeles Districts.
TOTAL LOANS MADE BY ALL SAVINGS AND LOAN ASSOCIATIONS
UNITED STATES -
BY TYPE OF ASSOCIATION
MILLIONS
Federal Savings and Loan System
[Table 7]
•
FEDERAL savings and loan associations effected
several consolidations in December—reducing
the total number of new associations by two and
the number of converted Federals by four; assets
grew, however, in both of these classifications as
indicated in the accompanying table.
A group of Federal associations which presented
statements for both November and December of
1938 reported a considerable growth in private
capital, largely due to the crediting of dividends to
individual accounts at the year-end (Table 7,
page 160). Book closing adjustments in December
altered total resources and tended to check the
usual monthly growth in assets of reporting institutions.
Rather heavy borrowing on a short-term basis
from Federal Home Loan Banks occurred in December. All Federals are required to close their
books at the end of the year, and many associations
prefer to use their credit in the Banks temporarily,
rather than curtail lending activity or disturb their
investment portfolio to raise funds to meet yearend withdrawal requirements.
Unusually favorable December lending activity
was recorded by reporting Federals, although there
is normally a seasonal recession at the end of the
year. Rising trends in building activity, which
continued into December, were responsible for increased construction loans for Federals in that
month; accelerated refinancing operations and a
slight rise in home purchase loan volume also
contributed to increased total mortgage-loan commitments made by Federal savings and loan associations in December.
Progress in number and assets of Federal savings
and loan associations
Number
Dec.
31,
1938
IIIIIIIH
111II111II
February 1939
New _ _
Converted. _
JUM SEP
1938
JUtt
1939
637
729
Nov.
30,
1938
Approximate assets
Dec. 31, 1938 Nov. 30, 1938
639 $343, 946, 000 $335, 827, 000
733 968, 639, 000 961, 695, 000
Total. __ 1,366 1,372 1, 312, 585, 000 1, 297, 522, 000
149
Federal Savings and Loan Insurance Corporation
[Tables 7 and 8]
Private repurchasable capital of 1,786 identical insured
• CONTINUED sound, steady growth was typical
associations
of insured associations during 1938. Despite the
[Amounts are shown in thousands of dollars]
fact that economic activity was low during the first
six months, 1,736 identical insured institutions inFederal Home Number
Percent
Dec. 31,
30,
creased their private capital $69,390,000—13 percent
inof asso- June
Loan Bank
1937
1938
crease
ciations
Districts
on an annual basis.
Every Bank District reflected increases in private
repurchasable capital. During the first six months
Percent
Boston
8.2
51 $74, 387. 4 $68, 743. 8
of the year, Winston-Salem had the largest percentNew York
7.8
112 119, 013. 3 110,382. 8
age rise (19), followed by Pittsburgh (16). WinstonPittsburgh
15.9
16, 379. 2
18, 976. 3
75
Winston-Salem _
19.2
62, 538. 6
74, 539. 5
217
Salem showed the most increase in dollar volume
Cincinnati
2.8
282 322, 386. 6 313, 621. 9
($12,000,000), followed by Cincinnati and New York
2.4
93, 603. 1
95, 863. 5
Indianapolis
144
10.8
56, 201. 7
62, 261. 9
Chicago
142
with over $8,600,000.
9.2
58, 256. 9
63, 614. 2
Des Moines
129
During 1938, 244 associations with assets of
Little Rock
5.6
249 108, 987. 3 103, 191. 9
62, 998. 2
Topeka
65, 074. 8
128
3.3
$186,429,000 were insured. Of these, 192 were State47, 361. 8
Portland
51, 179. 1
109
8. 1
chartered institutions, and 52 were Federal savings
81, 301. 7
87, 687. 9
7.9
98
Los Angeles
and loan associations. The chart below shows the
Total. _. 1,736 1,143,971.8 1,074,581.6
6.5
distribution of assets of all insured associations.
The largest proportion (45.4 percent) is held by those
institutions which have converted to Federal charters.
bonds. There were 2,097 insured associations with
assets of $2,129,000,000 and 2,100,000 protected
The Insurance Corporation settled all loss and
savers, at the close of 1938.
liquidation cases placed in its custody during 1938.
During December applications for insurance were
Of the four insured institutions which were taken over
received from 26 associations, of which 19 were Statelast year, two were reorganized and are now operating
chartered institutions. Identical insured associaon a solvent basis, and two were Uquidated and all
tions (1,897) reporting in November and December
investors paid in full with cash.
showed a $26,000,000 increase in private repurchasAssets of the Corporation on December 31, 1938,
able capital. New mortgage loans were $1,384,000
totaled $116,878,103 of which $116,196,261 was in
cash and Government or Government-guaranteed
higher than November.
PROGRESS OF FEDERAL SAVINGS AND LOAN INSURANCE CORPORATION
2,200
ASSETS
— LEGEND
20OO
TOTAL NUMBER OF
INSURED I N S T I T U T I O N S \ J \
[%&- 2,000
(NEW
!
FEDERAL INSTITUTIONS^
[CONVERTED...
1,800 I-STATE CHARTERED INSTITUTIONS...
co ijBOO
1,600
O
^
1,400
»-
|
1,400
5 £oo|
1,200
z
u. 1,000
1,000
5 8001
800
o
INSURED
CD
2
600
=
600
400
400
200
I I I I I I I I I II I I I I I
DEC MAR
1934
150
JUN. SEP. DEC. MAR. JUN, SEP.
1938
I93t
JUN. SEP. DEC. MAR. JUN. SEP. DEC.
1937
1938
200
DEC 31
1938
Federal Home Loan Bank Review
Federal Home Loan Bank System: Progress in 1938
[Table 9; Supplemental Tables A, B]
•
THE membership growth in the year 1938, while
not numerically impressive, was most encouraging from the standpoint of a strengthening of the
Federal Home Loan Bank System. In addition to
the admission of new members, the fact that numerous mergers and consolidations were effected
should prove beneficial. The net increase in members during the year was 19 which brought the total
to 3,951 as of December 31, 1938 with estimated
assets in excess of 4.4 billions of dollars.
From an all-time high of $200,095,000 in advances
outstanding on December 31, 1937, the Banks report
a reduction of $1,253,000 to a figure of $198,842,000
as of the close of 1938. Advances during the year
amounted to $81,958,000 and repayments totaled
$83,211,000. Although it was the first time in six
years of operation that the Banks have failed to reflect an increase in the total advances outstanding
over the close of the prior year's balance, the average
monthly balance of advances outstanding in 1938 was
some 26 million dollars higher than in 1937, as is
clear from the bar chart on this page.
Since the inception of the Banks, 487 million dollars have been advanced to member institutions and
repayments on these advances have amounted to 288
million dollars.
Dividends ranging from 1 to 2 percent were declared by the 12 Federal Home Loan Banks during
the year 1938 in a total amount of $2,405,622.44, as
tabulated at the bottom of the page. The United
States Treasury received $1,845,635 in 1938 on its
capital stock investments in the Banks, which brings
AVERAGE MONTHLY BALANCE OF
ADVANCES OUTSTANDING
$ 43,963,619
86,851,652
84,591,856
118,620,301
164,301,899
190,490,036
the cumulative total received during the past six
years to $9,161,768.59. Members were paid $559,987.44 in dividends during 1938 to bring the amounts
received from this source since the inception of the
Banks to a total of $2,416,959.14. The rates of
dividends declared in 1938 by the Banks were the
same as those declared in 1937 with the exception of
the Portland Bank, where the rate was reduced from
Supplemental Table A — F . H. L. B. System—Dividends paid or declared through Dec- 3 1 , 1938
Total for 1938
Federal Home Loan
Bank
Rate
per
annum
Percent
No.
No.
No.
No.
No.
No.
No.
No.
No.
No.
No.
No.
1—Boston
2—New York
3—Pittsburgh »
4—Winston-Salem *
5—Cincinnati
6—Indianapolis
7—Chicago
8—Des Moines
__
9—Little Rock
10—Topeka
11—Portland
-..
12—Los AngeJes— _Total
1
1
.--
f
Cumulative through Dec. 31, 1938
Government
Members
Total
$52, 305. 17
$187, 012. 50
284, 448. 00
111,463.00
92, 082. 00
255, 514. 00
98, 661. 00
283, 478. 00
147, 898. 00
87, 724. 00
73, 336. 00
74, 500. 00
149, 518. 50
$239, 317. 67
345, 971. 89
135, 415. 05
127, 500. 12
394, 541. 85
136, 553. 04
369, 017. 64
186, 917. 14
107, 301. 12
88, 746. 00
87, 659. 65
186, 681. 27
ltf 61, 523. 89
Government
Members
$172, 423. 84 $658, 454. 61
336, 964. 23 1, 401, 036. 75
834, 111. 39
160, 915. 95
603, 825. 29
184, 291. 96
606, 907. 22 1, 435, 749. 79
574, 986. 59
192, 637. 01
315, 085. 57 1, 378, 209. 45
634, 313. 31
131, 031. 74
551, 304. 62
105, 566. 96
313, 252. 56
60, 040. 82
349, 790. 88
49, 579. 66
426, 733. 35
101, 514. 18
Total
$830, 878. 45
1, 738, 000. 98
995, 127. 34
788, 117. 25
2,042, 657. 01
767, 623. 60
1, 693, 295. 02
765, 345. 05
656, 871. 58
373, 293. 38
399, 370. 54
528, 247. 53
1 23, 952. 05
1 35, 418. 12
2 139, 027. 85
37, 892. 04
lji 85, 539. 64
2 39, 019. 14
2
19, 577. 12
1 15, 410. 00
1 13, 159. 65
Vfi 37, 162. 77
1)4
559, 987. 44 1, 845, 635. 00 2, 405, 622. 44 2, 416, 959. 14 9, 161, 768. 59 11, 578, 727. 73
Dividends declared as of Dec. 31, 1938, for the calendar year 1938; other Banks declared semiannual dividends.
Annual rate 2 percent for first six months, 1 percent for last six months.
February 1939
I5I
Condensed consolidated statement of condition of the Federal Home Loan Banks as of Dec. 3 1 , 1 9 3 8
ASSETS
CASH
Cash on hand and on deposit in the U.S. Treasury
and commercial banks.
INVESTMENTS
Book value of obligations of the U. S. Government
and securities fully guaranteed by it.
ADVANCES OUTSTANDING
Advances to members total $198,839,803.15, and to
nonmember mortgagee $2,635.00, made under provisions of the Federal Home Loan Bank Act.
ACCRUED I N T E R E S T RECEIVABLE
Interest accrued but not due on investments and
advances outstanding.
DEFERRED CHARGES..
Prepaid expense items applicable to future operations.
O T H E R ASSETS
Accounts receivable and miscellaneous assets. Of
this amount, $75,000 represents a refund credit on
Federal Home Loan Bank Board assessments applicable to the assessments for the first half of 1939.
TOTAL ASSETS
LIABILITIES AND CAPITAL
(13.33%)
$37,849,688.54
(16.35%)
46,404,368.99
(70.04%)
198,842,438.15
(0.21%)
601,536.10
(0.04%)
118,063.17
(0.03%)
80,098.42
(100.00%)
$283,896,193.37
LIABILITIES
DEPOSITS
_
$21,975,062.42
Demand and time deposits of members totaled $21,900,108.81,
and the deposits of applicants on stock subscribed in connection
with membership applications $74,953.61.
ACCRUED I N T E R E S T PAYABLE
398,845.23
Interest accrued, but not due on members' time deposits
$32,178.65 and on consolidated debentures $366,666.58.
DIVIDENDS PAYABLE
1,027,560.34
Portion of 1938 dividends declared payable in January 1939.
ACCOUNTS PAYABLE
27,288.77
Debentures matured and interest accrued on certificates not
presented for payment totals $21,185 while $5,000 was held for
stock certificates canceled but not presented by former member
institutions for refund. Miscellaneous items are in an amount
of $1,103.77.
D E B E N T U R E S OUTSTANDING
90,000,000.00
Consolidated debentures issued which are the joint and several
obligations of the Federal Home Loan Banks.
Series C—2%—12-1-40—$25,000,000.
Series D—2%— 4-1-43—$23,500,000.
Scries E—1%— 7-1-39—$41,500,000.
P R E M I U M S ON D E B E N T U R E S
176,615.34
Unamortized premiums received on sales of consolidated debentures.
TOTAL LIABILITIES.
$113,605,372.10
CAPITAL
CAPITAL STOCK:
Fully paid issued and outstanding
$162,622,900.00
Subscribed and partially paid
$144,100.00
Less unpaid balance
54,875.00
89,225.00
As of December 31, 1938, the U. S. Treasury held 76.6 percent of the
total capital stock in the Federal Home Loan Banks which represented
an investmentof $124,741,000. The capital stock of the Banks owned
by members totaled $38,026,000 on which there was an unpaid balance of
$54,875. This amount represents an increase of 8.6 percent over December 31, 1937, or $3,008,700.
The surplus, reserve, and undivided profits accounts of the several
Banks reflect an increase from $5,204,423 at the close of 1937 to $7,578,696
on December 31,1938, which is a gain of 45.6 percent.
iy2 percent to 1% percent, and the New York Bank
where the rate was reduced from 2 percent to 1
percent for the second half of 1938. The Los
Angeles Bank rate was K percent higher in the first
half of 1938 than the rate declared for the first half
of 1937.
From the comparative consolidated statement of
condition of the Federal Home Loan Banks at the
close of the years 1938, 1937, and 1936 on the opposite page, it is to be noted that total resources of
the Banks increased from $161,935,296 to $256,877,295 and to $283,896,193 representing a change of
58.6 percent from 1936 to 1937 and of 10.5 percent
from 1937 to 1938. The issuance of consolidated
debentures in M a y 1937 reflected a change in the
financing policy of the Banks and is the main factor
in the growth of resources. Of the 95 million dollar
increase in resources in 1937, 77.7 millions are directly
attributable to debentures, while of the 27 million
dollar increase in 1938 additional debentures issued
accounted for 12.3 millions. The fact that cash and
investment items now constitute 29.7 percent of the
resources as compared to 9.9 percent on December 31,
152
Total paid in
$162,712,125.00
SURPLUS:
Legal reserve (20% of net earnings to date)
3,832,798.73
Reserve for contingencies (future investment
transactions)
262,021.01
Total surplus.
$4,094,819.74
U N D I V I D E D PROFITS
3,483,876.53
TOTAL CAPITAL
$170,290,821.27
TOTAL LIABILITIES AND CAPITAL
$283,896,193.37
1936, and that advances outstanding represent
only 70 percent of the resources as against 90 percent
on December 31, 1936 is indicative of the influence
the debenture issues have had on the financial structures of the Banks.
Consolidated debentures outstanding amounted to
90 million dollars on December 31, 1938, compared
to 77.7 million dollars at the end of 1937. There
were two series, D and E , issued during 1938 in
amounts of 23.5 and 41.5 million dollars respectively.
The proceeds of these issues were used primarily to
retire series A and B which were 1-year debentures
maturing during the past year.
Detailed statements of condition and of profit and
loss for the 12 Federal Home Loan Banks will be
found in Supplemental Tables A and B on pages 162
and 164.
C U R R E N T OPERATIONS
Although the usual semiannual increase in lending
activities of the Banks in December proved insufficient to return the balance of advances outstanding
(Continued on p. 168)
Federal Home Loan Bank Review
Consolidated statements of condition of the Federal Home Loan Banks compared for the
years 1 9 3 8 , 1 9 3 7 , and 1936
December 3 1 , 1937 (Revised)
December 3 1 , 1938
Percentage
Distribution
Amounts
December 3 1 , 1936 (Revised)
Percentage
Distribution
Amounts
Amounts
Percentage
[Distribution
6,513,650.44
4.02
ASSETS
CASH:
$
37,849,688.54
13.33
46,404,368.99
23,203,071.96
9.03
16.35
32,620,157.86
12.70
9,479,973.70
5.86
70.04
200,091,653.48
2,975.00
0
200,094,628.48
77.90
145,393,904.37
3,315.00
3 f 510.58
: 145.400.729.95
89.79
.21
218,592.18
470,254.37
26.24
0
688,872.79
.27
83,980.41
361,790.44
29.17
1.16
445,801.18
.28
.04
97,291.87
0
15,645.96
9.50
112,947.33
.04
0
72,631.25
14,458.48
401.90
87,491.63
75,000.00
3,927.17
1,171.25
80,098.42
.03
152,439.70
4,302.14
874.97
157,616.81
.06
0
6,844.85
804.44
7,649.29
$ 283,896,193.37
100.00
$ 256,877,295.23
100.00
$161,935,296.19
INVESTMENTS:
U. S . Government o b l i g a t i o n s and s e c u r i t i e s
ADVANCES OUTSTANDING:
198,839,803.15
2,635.00
0
198,842,438.15
ACCRUED INTEREST RECEIVABLE:
210,887.15
390,625.71
23.24
0
601,536.10
$
;
$
DEFERRED CHARGES:
102,837.73
0
15,101.94
123.50
118,063.17
P r e p a i d s u r e t y bond and i n s u r a n c e premiums . . . .
T o t a l D e f e r r e d Charges
OTHER. ASSETS:
Accounts r e c e i v a b l e - F. H. L. B . B. assessment
1
1
j
.05
100.00
L I A B I L I T I E S AND CAPITAL
LIABILITIES:
DEPOSITS:
$
Total Deposits
19,801,365.98
2,098,742.83
74,953.61
0
21,975,062.42
$
7.74
11,372,635.28
1,193,167.53
149,125.00
56.932.50
12,771,860.31
4.97
9,355,575.18
1,390,017.68
226,850.00
173,708.75
11,146,151.61
32,178.65
366,666.58
398,845.23
.14
16,536.19
309,291.65
325,827.84
.13
14,744.49
0
14,744.49
770,938.75
256,621.59
1,027,560.34
.36
914,864.05
262,514.15
1,177.378.20
.46
933,348.58
239,241.83
1,172,590.41
.73
27,288.77
.01
3,035.21
0
472.82
0
$
6.88
ACCRUED INTEREST PAYABLE:
,
.01
DIVIDENDS PAYABLE:
Total
ACCOUNTS PAYABLE;
ACCOUNTS PAYABLE ( I n t e r e s t refund)
**CONSOLIDATED DEBENTURES OUTSTANDING
0
0
0
90,000,000.00
31.70
77,700,000.00
30.24
0
0
PREMIUMS ON DEBENTURES
176,615.34
.07
120,045.74
.05
0
0
Total L i a b i l i t i e s
113,605,372.10
40.02
92,098,147.30
35.85
12,333,959.33
7.62
CAPITAL:
CAPITAL STOCK (Par) :
Total
T o t a l p a i d i n on C a p i t a l S t o c k
SURPLUS:
R e s e r v e a s r e q u i r e d u n d e r S e c . 16 o f Act
37,881,900.00
144,100.00
38,026,000.00
54,875.00
37,971,125.00
124,741,000.00
0
124,741,000.00
162,712,125.00
13.37
13.56
O
43.94
57.31
3,832,798.73
262,021.01
4,094,819.74
124,741j000.00
159,574,725,00
48.56
62.12
2,876,819.56
0
0
3,483,876.53
T o t a l S u r p l u s and U n d i v i d e d P r o f i t s
34,577,000.00
440.300.00
35,017,300.00
183.575.00
34.833,725.00
124,741,000.00
28,126,200.00
365.300.00
28,491,500.00
175.925.00
28.315,575.00
124,741,000.00
17.48
j
117,869.400.00
146,184,975*00
2,045,336.23
Q
72.79
90.27
|
_
2,327,603.37
1.371,025.63
I
7,578,696.27
2.67
5,204,422.93
2.03
3,416.361.86
"" 2.11
170,290,821.27
59.98
164,779,147.93
64.15
149,601,336.86
92.38
$ 283,896,193.37
100.00
TOTAL, LIABILITIES AND CAPITAL
i 256,877,295.23
100.00
1$161,935,296.19
[ 100.00
**Consolidated Federal Home Loan Bank debentures issued by the Federal Home Loan Bank Board and now outstanding are the Joint and several
obligations of all Federal Home Loan Banks.
February 1939
153
Table 1.—Number and estimated cost of new family dwelling units provided in all cities of 10,000
population or over, in the United States l
[Source: Federal Home Loan Bank Board.
Compiled from residential building permits reported to U. S. Department of Labor]
[Amounts are shown in thousands of dollars]
Number of family units provided
Year
Monthly totals
Dec.
1938
Nov.
1938
Total cost of units
Dec.
1937
1938
Monthly totals
Dec.
1938
1937
Nov.
1938
Year
Dec.
1937
1938
1937
8,924 11, 479 6,444 127, 052 108, 601 $36, 178. 9 $49, 897. 4 $24, 252. 5 $501, 083. 0 $465,
1-family dwellings
782 1,386 10, 340 10, 126 1, 551. 4 2, 299. 9 4, 630. 0 26,651. 4 28,
600
2-family dwellings
2
53
906 1,031
34
172.3
47
120. 2
261. 2
3, 194. 4
Joint home and business
3,
3- and more-family dwellings._. 6,020 5,998 7,503 76, 435 48, 275 20, 463. 1 16, 236. 2 31, 400. 8 248, 874. 0 171,
Total residential _ .
223. 4
280. 2
692. 0
977. 9
15, 591 18, 312 15, 367 214, 733 168, 033 58, 365. 7 68, 694. 7 60, 403. 5 779, 802. 8 669, 173. 5
1
Estimate is based on reports from communities having approximately 95 percent of the population of all cities with population2 of 10,000 or over.
Includes 1- and 2-family dwellings with business property attached.
Table 2.—Number and estimated cost of new family dwelling units provided in all cities of 10,000
population or over, in December 1938, by Federal Home Loan Bank Districts and by States
[Source: Federal Home Loan Bank Board.
Compiled from residential building permits reported to U. S. Department of Labor]
[Amounts are shown in thousands of dollars]
All residential dwellings
Federal Home Loan Bank Districts
and States
Number of family
dwelling units
Dec.
1938
UNITED STATES. _.
No. 1—Boston
Connecticut
Maine
Massachusetts
New Hampshire
Rhode Island
15, 591
Dec.
1937
Estimated cost
Dec. 1938 Dec. 1937
15, 367 $58, 365. 7 $60, 403. 5
Number of family
dwelling units
Estimated cost
Dec.
1938
Dec.
1937
9,571
7,864 $37, 902. 6
Dec. 1938 Dec. 1937
$29, 002. 7
500
533
2, 399. 8
3, 838. 6
432
428
2, 177. 1
2, 198. 6
121
16
270
17
73
3
123
11
334
13
49
3
609.2
54. 1
1, 374. 8
38.9
308.2
14. 6
586.3
45.2
2, 952. 2
47.0
199.0
8.9
109
16
214
17
73
3
123
11
229
13
49
3
601. 7
54. 1
1, 159. 6
38. 9
308.2
14. 6
586.3
45. 2
1,312. 2
47. 0
199.0
8.9
10, 223 20, 962. 4
40, 176. 1
1, 135
3,248
5, 050. 7
11, 681. 0
Vermont
No. 2—New York
All 1- and 2-family dwellings
5,654
189
5,465
229
9,994
995.8
19, 966. 6
1, 039. 5
39, 136. 6
189
946
127
3, 121
995.8
4, 054. 9
723.5
10, 957. 5
New York
679
285
3, 756. 4
1, 371. 9
462
274
2, 579. 7
1, 335. 9
No. 3—Pittsburgh
3
620
56
250
35
26.0
3, 528. 1
202.3
1, 213. 0
158.9
3
413
46
247
27
26.0
2, 372. 4
181.3
1, 203. 0
132.9
1,780
832
5, 774. 7
2, 765. 0
1,253
734
4, 285. 3
2, 525. 0
123
418
681
58
119
281
232.8
1, 754. 5
2, 243. 5
122. 6
594.7
828.0
123
188
420
50
79
261
232. 8
1. 074. 5
1, 478. 9
109. 1
498.7
767.5
New Jersey
Delaware
Pennsylvania
West Virginia
No. 4—Winston-Salem._.
Alabama
District of Columbia
Florida
154
Federal Home Loan Bank Review
Table 2.—Number and estimated cost of new family dwelling units provided in all cities of 10,000
population or over, in December 1938, by Federal Home Loan Bank Districts and by States—Contd,
[Amounts are shown in thousands of dollars]
All 1- and 2-family dwellings
All residential dwellings
N u m b e r of family
dwelling units
Federal H o m e Loan B a n k Districts
a n d States
Dec.
1938
N o . 4—Winston-Salem—Continued.
Georgia
Maryland
N o r t h C a r o l i n a - - -_
South Carolina
Virginia
-N o . 5—Cincinnati
Indiana
Michigan
- __
Dec. 1937
Dec.
1938
E s t i m a t e d cost
Dec.
1937
Dec. 1938 Dec. 1937
59
71
133
40
71
$290. 4
379.8
375.4
150.9
347.4
$148. 2
361.9
321.3
104.0
284.3
110
118
140
66
88
55
71
117
36
65
$290. 4
373.8
342.6
150. 9
341.4
$145.
361.
271.
96.
275.
512
263
2, 239. 6
1, 260. 5
414
225
1, 960. 1
1, 127. 5
36
408
68
40
190
33
119. 1
1, 922. 8
197. 7
104.6
1, 101. 9
54.0
36
310
68
40
152
33
119. 1
1, 643. 3
197.7
104. 6
968. 9
54. 0
_ _
863
257
4, 208. 2
1, 300. 9
863
257
4, 208. 2
1, 087. 0
-_
131
732
34
223
504.6
3, 703. 6
113. 1
1, 187. 8
131
732
34
223
504. 6 i
3, 703. 6
387
177
2, 176. 4
1, 228. 4
379
177~
2, 157. 1
1, 228. 4
-
-
N o . 6—Indianapolis
Dec. 1938
N u m b e r of family
dwelling units
110
123
167
66
92
- -
Kentucky
Ohio
Tennessee.
Dec.
1937
E s t i m a t e d cost
2
9
3
0
3
113. 1
973. 9
IllinoisWisconsin.
--
270
117
103
74
1, 669. 6
506.8
873.3
355. 1
265
114
103
74
1, 658. 3
498. 8
873 3
355. 1
No. 8—Des Moines
____
398
179
1, 533. 6
649.4
389
155 I
1, 502. 6
606. 9
89
146
145
0
18
37
91
39
2
10
316.0
652. 8
526. 9
0.0
37.9
145.8
357.9
118. 8
5.0
21.9
84
146
141
0
18
37 |
76
35
2
5
302. 0
652. 8
509. 9
0.0
37.9
1,207
780
3, 309. 6
1, 808. 3
1, 173
716
75
135
77
34
886
20
86
50
13
611
129.4
397.2
129. 6
102. 7
2, 550. 7
32.8
260.5
70. 2
29.8
1, 415. 0
75
135
77
34
852
20
86
50
13
547
410
217
1, 209. 0
693.6
362
217
.
103
84
42
181
41
53
21
102
318.3
196.4
136.4
557.9
160. 1
124.0
66. 3
343.2
71
72
42
177
41
53
21
102
257.
173.
136.
552.
Nofll—Portland.-.
311
176
1,011. 1
504.5
311
176
1,011. 1
4
21
90
40
146
10
4
12
47
31
78
4
12.7
45. 5
345.0
111.7
460.4
35.8
12.0
37.7
139.7
65.4
236. 7
13.0
4
21
90
40
146
10
4
12
47
31
78
4
12.7
45. 5
345.0
111. 7
460. 4
35. 8
12
37
139
65
236
13
2,890
1,445
9, 784. 9
4, 806. 3
2,398
1,257
8, 615. 8 i
4, 302. 9
56
2,798
36
17
1,421
7
160.4
9, 481. 2
143. 3
52. 6
4, 738. 7
15. 0
40
2,341
17
17
1,233
7
123. 4
8, 409. 1
83 3
52. 6
4, 235. 3
15 0
Iowa
Minnesota
Missouri
North Dakota
South D a k o t a
.
. .
_ _
N o . 9—Little Rock
._
Arkansas
Louisiana
Mississippi
New Mexico
Texas
_ ..
.
N o . 10—Topeka
Colorado
Kansas
Nebraska
Oklahoma
. _.
Idaho
Montana
Oregon
Utah
Washington
Wyoming
N o . 12—Los Angeles
Arizona
California
Nevada.
February 1939
.
.._
-_
._ _
__
.
3, 235. 1
1
1
|
129.
397.
129.
102.
1 2, 476.
4
2
6
7
2
1,119.8 |
3
2 '
4
9
145
330.
110
5
14.
8
9
8
0
4
1, 711. 4
32
260.
70
29
1, 318
8
5
2
8
1
693 6
160
124
66
343
1
0
3
2
504 5
0
7
7
4
7
0
155
Table 3.—Cost of building the same standard house in representative cities in specific months1
NOTE.—These figures are subject to correction
[Source: Federal Home Loan Bank Board]
Cubic-foot cost
Federal Home Loan Bank Districts
and cities
No. 2—New York:
Atlantic City, N. J__.
Camden, N. J
Newark, N. J
Albany, N. Y
Buffalo, N. Y
Utica, N. Y
White Plains, N. Y__
1939
Jan.
0.241
.233
.231
.242
.255
.239
.258
1938
Jan.
2
Total cost
1937
Jan.
$0,247
.238
.223
.258
.261
$0. 256
.230
.223
.233
.243
.262
,249
$5, 790
5,581
5,539
5,800
6,115
5,726
6, 180
Oct.
July
2
$5,907
2
2
$5,932
2
2
5, 559
5,537
5,847
6,303
5, 660
6,236
No. 6—Indianapolis:
Evansville, Ind
Indianapolis, Ind
South Bend, Ind
Detroit, Mich
Grand Rapids, Mich-
.244
.243
. 243
.258
.246
240
238
258
254
246
.230
.229
.256
.229
.219
5,854
5,831
5,821
No. 8—Des Moines:
Des Moines, I o w a —
Duluth, Minn
St. Paul, Minn
Kansas City, Mo
St. Louis, Mo
Fargo, N. D
Sioux Falls, S. D_._.
.262
.249
.272
.242
.253
.236
.271
261
260
6,279
5,975
6,529
5,808
6,078
5,658
6,515
6,164
6, 186
6,532
243
259
248
264
256
237
249
227
259
239
243
No. 11—Portland:
Boise, Idaho
Great Falls, Mont-_.
Portland, Oreg
Salt Lake City, Utah
Seattle, Wash
Spokane, Wash
.253
.291
. 229
.245
. 261
.250
.247
.292
.232
. 252
. 271
.273
249
274
222
237
255
266
6,078
6,996
5,495
5,880
6,272
6,001
6,002
6, 181
5,900
1937
Jan.
1938
1939
Jan.
5,742
5,765
5,750
6,166
5,871
5,989
5,832
6,436
5,455
5,880
6,259
6,286
2
Apr.
Jan.
2
6,073
$5,934
5,710
5,363
6,200
6,260
$6, 138
5,529
5,346
5,590
5,833
~6,~198~
6,291
5,966
5,770
5,812
5,964
6,026
5,911
5,769
5,711
6,193
6,108
5,908
5,518
5,505
6,138
5,494
5,257
6, 199
6,546
5,751
6,027
5,843
6,374
6,139
6, 195
6, 539
5,730
6, 122
5,868
6, 196
6,264
6,248
5,840
6,207
5,957
6,339
6,139
5,697
5,973
5,444
6,224
5,732
5,837
5,860
7, 109
5,397
5,911
6,256
6,620
5,848
7,137
5,391
5,961
6,428
6,545
5,934
7,004
5,563
6,039
6,503
6,548
5,972
6,582
5,322
5,692
6,114
6,375
5, 705
5,479
5,957
6, 149
5, 524
5,806
5,739
6,142
5,914
6, 117
$5, 688
5,427
1
The house on which costs are reported is a detached 6-room home of 24,000 cubic feet volume. Living room, dining
room, kitchen, and lavatory on first floor; 3 bedrooms and bath on second floor. Exterior is wide-board siding with brick and
stucco as features of design. Best quality materials and workmanship are used throughout.
The house is not completed ready for occupancy. It includes all fundamental structural elements, an attached 1-car garage,
an unfinished cellar, an unfinished attic, a fireplace, essential heating, plumbing, and electric wiring equipment and complete
insulation. It does not include wall-paper nor other wall nor ceiling finish on interior plastered surface, lighting fixtures, refrigerators, water heaters, ranges, screens, weather stripping, nor window shades.
Reported costs include, in addition to material and labor costs, compensation insurance, an allowance for contractor's
overhead and transportation of materials, plus 10 percent for builder's profit.
Reported costs do not include the cost of land nor of surveying the land, the cost of planting the lot, nor of providing walks
and driveways; they do not include architect's fee, cost of building permit, financing charges, nor sales cokfcs.
In figuring costs, current prices on the same building materials list are obtained every 3 months from the same dealers,
and current wage rates are obtained from the same reputable contractors and operative builders.
2
Revised.
NOTE FOR CHART ON FACING PAGE:
A new building code in New York City, effective January 1938, caused an unusual spurt of applications for permits which
threw the United States total out of balance. The dotted line shows that total excluding New York City for December 1937
and January and February 1938.
156
Federal Home Loan Bank Review
RATE OF RESIDENTIAL BUILDING IN ALL CITIES OF 10,000 OR MORE POPULATION
REPRESENTS
THE ESTIMATED
NUMBER
OF PRIVATELY
Source: Federal Home Loon Bank Board.
/«S.&?«""""|
DISTRICT
FEDERAL
HOME
DISTRICT
I
1
BOSTON
FAMILY
DWELLING
UNITS
PROVIDED
LOAN
BANK
PER 100,000
POPULATION
of t
DISTRICTS
2
NEW YORK
Lf
L-/«55
50
-
FINANCED
Compiled from Building Permits reported to US. Department
i r-i
40
30
.l_||
1
'
•
b-~i
r—
^m/ss
AVC
L—
_ AUG SEP OCX NOV DEC
. AUG. SER OCX NOW OEC.
DISTRICT
DISTRICT 5.
CINCINNATI
6
INDIANAPOLIS
JAN. FEE MAR. APR MAY JUt JUL. AUG. SER OCX NOV. DEC.
DISTRICT 10
TOPEKA
S
1
j
r^L
n-J^=Cik_
l
~
L
^ —
T_
~t 1931-33 AVG.
«
•.
JAN. FEB MAR. APR MAY JUN. JUL. AUG. SEP. OCX NOV. OEC.
UNITED
STATES AVERAGE
1930-1938
nJ
EXCLUDING MEW romc arr^,
see note on facing page
\r\
r
OWISKM VflCSEAflCHAM STATISTIC*
PE08RAL HOME LOAN BANK BOARD
l . , t . i . . t « . i .
February 1939
1 1 1 M
1 1 1 1 1, i
i i I I i i i i i i I
i i i i i i I t I i i
i i I i i l i i i i i
_ l .-L_I—1—1—1 L-l-1 1-1
1 1 1 1 1 1 1 1 1 1 1
157
Percent
increase
rH
CCOONrH
OiOi'tfrH
1 t^^CD^
CM* O N
O
H
1 I CO
CD* C> Oi* «tf'
t^rJ*CD*CM*
!
I '
I ' l l
I
I + I 7 14-17
938
~oo
S2© M
CO
03 r H
*-• *-• <.; 0
0
CD
D C *
<A . 2 J3
00*;'0
* £ Q
> 2
1—1
1938
M+
c
o
o
r H H ^ O N
rHCM 0 0 O
CMCMOiO
H C D O « C
00 00 v O ^
O r - . O i O i
CDOir-cD
1>I^CM!>
^ O i r ^ O
O i t o CO 0 0
CO t O C O r H
O 0 N C M O 0
C O T * C O C O
C0r>OiCD
O ^ r H C O
« D N O O
© O N H
0 0 CM CO CM
tdo~oTto~
COOCMO
OOCMCMr^
NCMOiCO
CD 1-1 r H CO
CMOCMOi
H T ^ l O H
CDI>O00
CO i O 0 0 CM
r-^
rHOOOO"^
TJH r-i J-4
COOOiCOi
OiCMT^rH
OirHlCCM
^ C M r H r H
1 0 CD i C C M
^ r H C M
CO 0 0 CM t o
"H/l r H r H r H
CO O i CM r H
COrH rH
CM CM C O " ^
N C O C O
r H r H r H O0
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CD CM » 0 0 0
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l O O O
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r H r H C M t ^
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l > r f Tin 00
r H O i CM O i
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rt^CMrHrH
0 0 0 0 l > CM
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r H Q O C M O
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co' t o i > 0 0
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to
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1
1
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CQ
03
*
•aS
fe
TJ
di
1 £
i-H
0
ates: Total
Federal—.
State mem
Nonmemb
Home Loan
rict and type
sociati<
d
0
-r»
QQ
"0
0
•+*
d
P
CATTH
0 0 CO CO rH
OiCO^
COrH rH
CD CM CM r H
CO r H
^ H ( N
CO'rH r H
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1
1 ©
«J
1
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g
1
1
1
1
1
1 1 1
t
1 1
1 1 1
1 1 •
1 *-t
1
'-~ a
• ;; a-S •! J! §Ba
s
! sa
1
t
1
a
s
s
1
1
1 I*
\
1
i»c
^
!• J! da^
a
1
1
1
i
1
1
1
1
1
l
l
1
t 1
1
1 l
1
*H
1
I
1
1
1
1
1
I
1 1
1 1
» U
1 O
1
>
]
'
1
I
1
1
!! 1 S-9
i ; a-a
M » a
1
1 1
I I '
1 rH
1
^
&
! ! SJ2
1
t
1
1
i
t
1
1 1
*
J_l
;; | s
! ! a-P
1
1
I
I
1
1
1
I
1
1
I *
l U
1 0
1
1
1
1
1
1
1
1
J
»
1
1
1 r-l
'
1 ® «J
! i a^
i•is! a
2 aa?
! i a^
CD
i>
00
oi
6
•*»
•+»
0
'S
-M
CQ
s
•H
'u
-r»
QQ
5
J§S
•-a as
T-*
.°
*E
s->
as
5
-4*
#o
*n
-fi
to
S
^»
0
•f»
0
X
•+»
'C
QQ
s
QQ
-*»
P
-r3
P
*c
•+3
SQ
P
1
1
1
1
iH
•+»
eo
l
^
•+»
'C
•+J
1
CO
«
.8
"C
•+J
i
1
1
1 1
l '
^ !
i ! a^
rH
•+3
O
1
rH
Total.
Feder;
State
Nonm
Dec
CO t O CO CM
CD CM CM r H
ocococo
Total.
Feder
State
Nonn
H
Total—.
Federal-.
State me
Nonmem
O
Total—.
Federal..
State me:
Nonmem
H
O i O t O r *
1—t
O
iS
M 1+
N^"*Oi
1
1
IO
1 rH4-*~l
1
CMOCDCD
C O O C M O
O O i O r H
o3
1
M M
Total.
Feder;
State
Nonm
525
o
E
+ 1
O i r H W O l
CO rH* O
0
v
o
E
o
>
M M
+
CMOiNtO
N ' H H C O
rHCM CM CD
O 0 0 CD CD
l>l>OiOi
CMCMO00
CO CM O i CM
T ^ N - O N
CMNNcO
.
sw loans
* 2
M M
+
tOtOrHt"*
r H TH* rH* 0 0
rH
,
1 CM
t^t^COI>
O t ^ i > i O
CO CO CD CM
0
*-Sp
—
M M
1 l+l
CO O i
Total.
Feder;
State
Nonm
•? & a
111 +
O
Total.
Feder;
State
Nonm
** ° S
°*6 §
00* CD* CD O*
rH
Total—.
Federal-.
State me:
Nonmem
•• 8 g
O
CM* ^ * O
P
N
CO
c
O C D 0 0 O
I O CD i O CO
H | N |
rHOOCMrH
OOCOO^
N ^ r ^ C M
Total.
Feder;
State
Nonm
2
2
ercent
crease, J New
c. 1938 1 loans
over
1 Dec
v.1938
c
CMOi-^OO
I O r H CM CM
C 0 C D I > O
C O N O t O
Total.
Feder;
State
Nonm
~
CMCQrHrH
CO C 4 l - l I O
r H r H r H CM
NCMCOCM
( N O H H
CD O i 1-1 CD
NCMCOrH
-o
0 0 CD CD CO
CDl^Ort'
CM r H CO CO
o
?-t
O
rHCMOiOO
rHCOOCM
O O O CD i O
t » l > 00 iH
*OCM ( N O
00 cocoes
o
D
O
\
i
1
1
i i i 11
i
1
1
1
1
1
•
l *
1 rH >
1 ®
J
1 1 11
1 1 * 1
1 rH
'
1 0
'
. r g [5
! ! B&\
r-^
r-i
<N
• * »
-f»
p
'u
QQ
.9
P
i
1
•| J i da^
a
JO
'u
-*J
0 0 CO
tO~CM~CM~
1
1
l
l O ^
oocoTf
0
5 O N 0 0 H
Total.
Feder;
State
Nonm
c
o
i H O * CM* lO*
H
1 H H
Total.
Feder;
State
Nonm
O
937
Total new loans
-X>
-r»
P
! ' <& a
I'S
rH
-r>
O
"E
a ^
11
I
-r 9
1
P
1
QQ
I
00
Table 5.—Estimated volume of new loans by all savings and loan associations, classified according to
purpose and type of association
[Amounts are shown in thousands of dollars]
Purpose of loans
Type of association
Mortgage loans on homes
Period
1937.
December
1938.
January
February. _
March
April
May
June
July
August
September,
October
November.
December..
Reconditioning
Construction
Home
purchase
Refinancing
$234, 102
$326, 629
$180, 804
15, 281
20, 167
12, 677
220, 458
265, 485
160, 167
12, 572
11,669
16, 648
17, 710
19, 400
19, 892
19, 096
22, 575
21,018
22, 099
18, 627
19, 152
14, 896
16, 117
21,056
25, 494
24, 123
25, 636
21, 924
23, 833
25, 698
24, 677
21, 205
20, 826
$62, 143
11, 334
11, 293
14, 391
15, 772
15, 281
13, 885
13, 194
14, 701
12,416
12, 913
12, 182
12, 805
Loans for
all other
purposes
Total
loans
Federals
State
members
Nonmembers
$307, 278 $379, 286 $210, 015
$92, 901
$896, 579
4,175
7,796
60, 096
20, 038
24, 522
15, 536
58, 623
93, 263
797, 996
286, 899
333, 470
177, 627
3,409
3,662
4,953
5,683
5,416
5,211
5,397
5,528
4,791
5,727
4,821
4,025
6,891
7,352
8,170
8,648
8,059
8,443
8,028
8,072
7,724
7,515
7,235
7,126
49,
50,
65,
73,
72,
73,
67,
74,
71,
72,
64,
63,
102
093
218
307
279
067
639
709
647
931
070
934
16,
17,
23,
26,
24,
26,
23,
26,
25,
26,
24,
25,
781
520
356
107
721
310
823
858
650
534
220
019
20,
22,
27,
30,
31,
30,
28,
29,
29,
30,
26,
26,
879
073
835
238
196
350
973
506
255
546
115
504
11,442
10, 500
14, 027
16, 962
16, 362
16, 407
14, 843
18, 345
16, 742
15, 851
13, 735
12, 411
Table 6.—Index of wholesale price of building materials in the United States
[1926=100]
[Source: U. S. Department of Labor]
All build- Brick and
ing matile
terials
January
February...
March
April
May
June
July
August
September.
October
November.
December..
January
February __
March
April
May
June
July
August
September.
October
November..
December..
1937
1938
Change:
Dec. 1938-Nov. 1938Dec. 1938-Dec. 1937-
February 1939
Paint and Plumbing Structural
'
paint ma- and heating
terials
Cement
Lumber
89.7
91.0
91.8
94.9
95.0
95.0
95. 4
95. 5
95.0
93.4
92.9 i
92.0 j
95.5
95.5
95.5
95.5
95.5
95. 5
95. 5
95. 5
95.5
95.5
95.5
95.5
93.0
99.0
102. 1
103. 0
103. 0
102. 2
101.3
99.5
99.0
97.3
94.8
93.8
83.7
83.4
83. 9
83.9
83.7
83.6
83.9
84. 1
84.6
84. 2
81.5
80.2
91.8
91. 1
91.5
91.2
90.4
89.7
89.2
89.4
89.5
89.8
89.2
89.4
91.8
91.5
91. 1
90.4
90.5
90.6
90.7
90. 6
90.9
91. 1
91.5
91.5
95.5
95.5
95.5
95.5
95.5
95.5
95.5
95.5
95.5
95.5
95.5
95.5
92.6
91.0
91.3
91. 1
89.3
88.7
88.8
90.2
90.4
90.3
90.2
90.9
80. 1
79. 2
82.2
81.4
80.9
80. 1
80.5
80.5
80.4
81. 1
80.9
81.0
+0.2%
-3.4%
0.0%
-0.5%
+0. 8%
-3.1%
+ 0.1%
+ 1.0%
91.3
93.3
95.9
96.7
97.2
96.9
96. 7
96.3
96. 2
95. 4
93.7
92.5
!
!
0.0 %j
0.0%
1
77. 1
77.4
77.6
78.7
78.7
78.7
78.7
78.8
80.6
80. 6
79.6
79.6
104.7
104.7
112.9
114.9
114.9
114.9
114. 9
114. 9
114.9
114. 9
114.9
114.9
79.6
79.6
78.9
77.2
77.2
77.2
79.5
79.2
78.5
78.5
78.7
78.7 i
114.9
114.9
114.9
114.9
114.9
113.0
107.3
107. 3
107. 3 1
107. 3
107. 3
107. 3
0.0%
-1.1%
0.0%
-6.6%
Other
92.9
95.0
98.9
99.9
101.3
101. 1
101.0
101.0
100.8
100.2
98.7
96.9
95.8
95.3
94.8
94.8
94. 1
93.3
91.2
91.3
91.3
91.7
89.7
89.7
0.0%
- 7 . 4%
159
Table 7.—Monthly operations of 1,278 Federal savings and loan associations and 619 identical
insured State-chartered savings and loan associations reporting during November and December 1938
[Amounts are shown in thousands of dollars]
619 insured State members
1,278 Federals
November
December
Share liability at end of month:
Private share accounts (number)
Paid on private subscriptions
Treasury and H. 0. L. C. subscriptions
_
Change
November
to December
Percent
+ 1.9
773, 614
769, 277
Percent
+ 0.6
$824, 267. 3
$805, 135. 9
+ 2.4
$522, 213. 6
$515, 572. 1
+ 1.3
2
+ 0.8
560, 708. 3
553, 758. 0
+ 1.3
+ 19.7
-15.0
10, 595. 1
6, 147. 1
8, 649. 9
6, 300. 1
+ 22.5
-2.4
8, 465. 6
6, 385. 4
4, 751. 4
1, 402. 6
2, 251. 8
+ 8.5
+ 0.3
+ 7.2
-16.0
-13.9
3, 275. 0
3, 502. 2
2, 015. 0
510. 3
1, 138. 7
2, 966. 1
3, 166. 3
1, 803. 5
525. 0
1, 142. 2
+ 10.4
+ 10.6
+ 11.7
-2.8
-0.3
23, 802. 6
988, 931. 8
23, 256. 8
979, 188. 4
+ 2.3
+ 1.0
10, 441. 2
509, 440. 7
9, 603. 1
506, 577. 0
+ 8. 7
+0.6
100, 786. 5
3, 039. 7
93, 680. 1
2, 884. 2
+ 7.6
+ 5.4
37, 000. 5
3, 739. 9
35, 772. 4
3, 377. 4
+ 3.4
+ 10.7
103, 826. 2
96, 564. 3
+ 7.5
40, 740. 4
39, 149. 8
+4. 1
715, 767. 8
719, 176. 7
-0.5
1, 012, 999. 7
+ 1.9
22, 830. 9
6, 449. 6
19, 074. 8
7, 586. 5
9, 186. 9
6, 405. 7
5, 092. 9
1, 178. 1
1, 939. 0
Total
Mortgage loans outstanding end of month_
Borrowed money as of end of month:
From Federal Home Loan Banks
From other sources
Total
3
Total assets, end of month
38, 494. 7
2
38, 185. 9
1, 032, 222. 2
Mortgage loans made during month:
a. New construction _
_
b. Purchase of homes
_
_
c. Refinancing. _ _
_
d. Reconditioning _
__
e. Other purposes
Change
November
to December
1, 093, 623
207, 863. 8
Private share investments during month _
Repurchases during month
November
1, 114,251
207, 954. 9
Total
December
+ 1.0
1, 244, 373. 4
1 , 256, 299. 5
3
1
Less than 0.1 percent.
*8 Includes only H. O. L. C. subscriptions.
Cumulated operating expense for period is deducted from reported December assets.
Table 8.—Institutions insured by the Federal Savings and Loan Insurance Corporation 1
[Amounts are shown in thousands of dollars]
Cumulative number at specified dates
Number
of investors
Assets
Private
repurchasable
capital
Dec. 31, Dec. 31, Dec. 31, Dec. 31, Nov. 30, Dec. 31,
1937
1938
1936
1938
1934
1935
Dec. 31,
1938
Dec. 31,
1938
Dec. 31,
1938
936, 100
865, 200
297, 500
$817, 626
967, 134
343, 946
$596, 490
677, 860
181, 406
2,097 2, 125, 800 2, 128, 706
1, 455, 756
Type of "association
State-chartered associations
Converted F. S. and L. A
New F. S. and L. A
Total
. _
4
108
339
136
406
572
382
560
634
566
672
641
451
1,114
1,576
1,879
2
725
721
639
2,085
3
737
723
637
1
Beginning Dec. 31, 1936, figures on number of associations insured include only those associations which have remitted
premiums.
Earlier figures include all associations approved by the Board for insurance.
2
In addition, 12 Federals with assets of $2,483,000 had been approved for conversion but had not been insured as of
November 30.
* In addition, 6 Federals with assets of $1,505,000 had been approved for conversion but had not been insured as of December 31.
160
Federal Home Loan Bank Review
Table
9.—Lending operations of the Federal
Home Loan Banks
[Thousands of dollars]
November
1938
Advances
outstanding at
Federal Home Loan
end of
Banks
ReReAdAd- pay- Decempay- vances
ber
vances ments
ments
December 1938
Boston
New York
Pittsburgh
Winston-Salem _
Cin cinnati
Indianapolis. _
Chicago
Des Moines
_
Little Rock
Topeka
Portland
Los Angeles_
Total
Jan.-Dec.
December
Jan.-Dec.
December
Jan.-Dec.
1938_ _
1937
1937
1936
1936_
$156 $245
1,327
445
718
463
2,193 ; 733
575
959
585
2,095
986
1,028
422
1,179
141
921
534
817
130
647
582
2,956
$586
888
324
675
524
372
328
499
328
125
48
550
$236
726|1
684
747!
462
32
257
140
831
237
340
87
$8, 566
18, 255
17, 390
19, 700
25, 918
14, 303
31, 804
17, 094
10, 518
11, 608
6, 484
17, 202
14, 996 5, 841 5,247 4, 779 198,842
81, 958 83,211
17, 591 i 4, 832
123, 251 168, 557
13, 473 5,333
93, 257 50, 651
200,095
145,401
Table 11.—H. O . L. C subscriptions to shares of
savings and loan associations1
[Amounts are shown in thousands of dollars]
Federal
savings
Unin- Insured and loan
sured
associaF.H.L.B. associations
members tions
Total
2
78
5,414
4,495
841
4,401 $52, 968 $195, 710 $253, 079
1
$100
12
$695
6
$433
19
$1, 228
2 21
682
4,812
4, 109
$951 $41, 576 $173, 014 $215, 541
15
$895
6
$128
21
$1, 023
1
Refers to number of separate investments, not to number
of 2associations in which investments are made.
Reduction due to insurance or federalization of associations.
February 1939
June 1, 1934
through
Nov. 30,
1938
Cases received 2
Dec. 1,
1938
through
Dec. 31,
1938
1, 004, 198
9, 819
Cumulative
through
Dec. 31,
1938
1, 014, 017
Contracts awarded:
632, 235
8, 916
641, 151
$123, 005, 9801$1, 923, 669 $124, 929, 64$
Number
Amount
Jobs completed:
10, 726|
622, 276
633, 002
$118, 896, 054 $2, 420, 291 $121, 316, 345
Number
Amount
1
All figures are subject to adjustment. Figures do not
include 52,269 reconditioning jobs, amounting to approximately $6,800,000, completed by the Corporation prior to
the organization of the Reconditioning Division on June 1,
1934.
2
Includes all property management, advance, insurance,
and loan cases referred to the Reconditioning Division which
were not withdrawn prior to preliminary inspection or cost
estimate prior to Apr. 15, 1937.
Table 12.—Properties acquired by H . O . L. C
through foreclosure and voluntary deed *
Period
State-chartered
Requests:
Oct.1935-Dec.1938
Number
Amount
December 1938:
Number
Amount
Subscriptions:
Oct.1935-Dec.1938
Number
Amount
December 1938:
Number
Amount
Table 10.—Reconditionins Division — Summary
of all reconditioning operations of H . O . L. C.
throush Dec. 3 1 , 1938 *
Prior to 1935
1935: Jan. 1 through
July 1 through
1936: Jan. 1 through
July 1 through
1937: Jan. 1 through
July 1 through
1938: January
February
March
April
May
June
July
August
September
October
November
December
June
Dec.
June
Dec.
June
Dec.
Number
30
31
30
31
30
31
Grand total to Dec. 31, 1938
9
114
983
4,449
15, 875
23, 225
26, 981
4,807
4,339
4,961
4,851
4,695
4,733
4,056
3,886
3, 856
3,616
3,534
3,585
122, 555
1
Does not include 11,286 properties bought in by H. O. L. C.
at foreclosure sale but awaiting expiration of the redemption
period before title in absolute fee can be obtained.
In addition to the 122,555 completed cases, 662 properties
were sold at foreclosure sale to parties other than the H. O.
L. C. and 16,266 cases have been withdrawn due to payment
of delinquencies by borrowers after foreclosure proceedings
were authorized.
I6I
Supplemental Table A—Statement of condition of
New Y o r k
Boston
Combined
Consolidated
Pittsburgh
j
ASSETS
$
On d e p o s i t
*U.
21,164.22
$
21,164.22
$
500.00
$
500.00
$
1,200.00
with:
S. Treasurer
-
Special
T o t a l Cash
.
D e p o s i t w i t h U. S . T r e a s u r e r
INVESTMENTS:
U. S . Government o b l i g a t i o n s
Account No. 17-678
. . . .
f o r matured o b l i g a t i o n s .
and s e c u r i t i e s
.
22,822,073.26
207,500.00
14,762,766.06
15,000.00
0
37,828,503.54
21,185.00
22,822,073.26
207,500.00
14,762,766.06
15,000.00
1.000.000.00
38,828,503.54
0
1,504,382.90
0
2,737,286.53
1,250.00
0
4,243,419.43
0
4,107,136.69
0
189,679.16a
1,250.00
0
4,298,565.85a
0
323,320.73
15,000.00
665,866.03
1,250.00
0
1,006,636.76
46,404,368.99
46,404,368.99
5,636,022.56
4,472,397.86
5,010,114.76(
198,839,803.15
2.635.00
198,842,438.15
198,839,803.15
2.635.00
198,842,438.15
8,566,355.99
0
8,566,355.99
18,254,855.72
0
18,254,855.72
17,389,608.12
0
17,389,608.12
0
210,887.15
390,625.71
23.24
601,536.10
82.19
210,887.15
390,625.71
23.24
601,618.29
0
27,659.05
13,355.15
0
41,014.20
0
21,978.70
58,344.37
0
80,323.07
24,452.21
69,114.52
9 3 , 5 6 6 . ? 30
102,837.73
15,101.94
123.50
118,063.17
102,837.73
15,101.94
123.50
118,063.17
0
1,312.50
0
1,312.50
0
2,099.36
0
2,099.36
11,833.30
1,756.93
0
13,590.23 1
75,000.00
3,927.17
1.171.25
80,098.42
75,000.00
3,927.17
1,171.25
80,098.42
4,807.50
149.00
0
4,956.50-
8,625.00
250.00
0
8,875.00
6,615.00
2,033.90
°
fully
ADVANCES OUTSTANDING:
ACCRUED INTEREST RECEIVABLE:
o
DEFERRED CHARGES:
OTHER ASSETS:
Accounts Receivable:
TOTAL ASSETS
LIABILITIES
0
8,648.90}
$283,896,193.37
$
284,875,090.56
$ 18,493,081.18 $
27,117,116.86
$ 23,522,165.50
$
$
19,801,365.98
2,098,742.83
74,953.61
1.000,000.00
22,975,062.42
$
$
2,721,176.13
380,500.00
6,350.00
0
3,108,026.13
$
AND C A P I T A L
LIABILITIES:
DEPOSITS:
Total
Deposits
19,801,365.98
2,098,742.83
74,953.61
0
21,975,062.42
1,858,957.95
50,000.00
500.00
0
1,909,457.95
333,212.30
0
13,478.61
0
346,690.91 1
ACCRUED INTEREST PAYABLE:
32,178.65
0
366.666.58
398,845.23
32,178.65
82.19
366,666.58
398,927.42
8,197.92
0
0
8,197.92
77.95
0
0
77.95
1,830.21
0
37,499.98
39,330.19
770,938.75
256,621.59
1,027,560.34
770,938.75
256,621.59
1,027,560.34
93,506.25
26,512.32
120,018.57
0
0
0
111,463.00
23,952.05
135,415.05
DIVIDENDS PAYABLE:
Total
Dividends Payable
PREMIUMS ON DEBENTURES
6,103.77
6,103.77
0
0
5,000.0X3
176,615.34
176,615.34
0
0
12,031.25
41,500,000.00
25,000,000.00
23j500,000.00
90,000,000.00
41,500,000.00
25,000,000.00
23,500,000.00
90,000,000.00
0
0
0
0
0
0
0
0
3,000,000.00
1,500,000.00
4,000,000.00
8,500,000.00
15,000.00
6.185.00
21,185.00
113,605,372.10
0
0
0
114,584,269.29
0
0
0
2,037,674.44
0
0
0
3,108,104.08
0
0
37,881,900.00
144,100.00
38,028,000.00
54.875.00
37,971,125.00
124,741,000.00
162,712,125.00
37,881,900.00
144,100.00
38,026,000.00
54.875.00
37,971,125.00
124,741,000.00
162,712,125.00
3,631,400.00
4,900.00
3,636,300.00
2.450.00
3,633,850.00
12,467j500.00
16,101,350.00
4,231,000.00
16,500.00
4,247,500.00
8.750.00
4,238,750.00
18,963,200.00
23,201,950.00
3,832,798.73
262.021.01
4,094,819.74
3.483.876.53
7,578,696.27
170,290,821.27
3,832,798.73
262,021.01
4,094,819.74
3.483,876.53
7,578^696.27
170,290,821.27
237,024.03
0
237,024.03
117.032.71
354,056.74
16,455,406.74
509,060.40
20,235,01
529,295.41
277.767.37
807,062.78
24,009,012.78
$283,896,193.37
$284,875,090.56
$18,493,081.18
$27,117,116.86
^CONSOLIDATED DEBENTURES:
2% S e r i e s
D. d u e A p r i l
1, 1943
MATURED OBLIGATIONS:
CAPITAL:
CAPITAL STOCK (PAR) :
U.
S. Government
(fully
paid)
0
9,038,467.40]
2,508,500.00
20,000.00
2,528,500.00
8,250.00
2,520,250.00
11,146.300.00
13,66.6,550.00
SURPLUS:
Total
Surplus
and Undivided P r o f i t s
TOTAL L I A B I L I T I E S AND CAPITAL
362,435.08
3 6 2 , 4 3 5 . 0 801 1
454.713.02!
R17 14R.1H
14,483,698.10
$23,522,165.50
As of December 3 1 , 1938 the New York Bank also held as Agent for the 12 Banks an imprest fund of $15,000, from which expenses of i s s u i n g
debentures, other than brokerage commissions, are to be paid.
Funds deposited with the U. S. Treasurer as Special Agent for the purpose of maturing i n t e r e s t coupons due and payable January 1, 1939 on
S e r i e s E 1% Consolidated Federal Home Loan Bank Debentures dated 7-1-38.
162
Federal Home Loan Bank Review
the Federal Home Loan Banks as of Dec. 3 1 , 1938
$
$
10.00
510.00 $
Des Moines
Chicago
Indianapolis
Cincinnati
Winston-Salem
5,845.61
$
300.00
$
12,013.61
$
25.00
$
25.00
243,538.67
10,000.00
80,887.82
1,250.00
0
347,690.10
0
2,512,190.61
10,000.00
0
1,250.00
0
2,523,465.61
0
1,522,848.53
10,000.00
5,197.39
1,250.00
0
1,539,320.92
0
3,550,000.00
2,878,631.48
2,490,000.00
1,698,750.00
14,303,163.44
0
14,303,163.44
31,803,704.54
0
31,803,704.54
17,094,463.05
0
17,094,463.05
10,518,026.85
0
10,518,026.85
11,608,197.63
0
11,608,197.63
0
38,756.55
91,456.41
0
130,212.96
0
13,497.41
4,090.26
0
17,587.67
0
11,127.99
6,815.55
0
17,943.54
23,915.07 !
10,121.84 i
0
34,036.91
i
11,198.09
715.92
9.50
11,923.51
12,548.74
1,400.76
96.00
14,045.50
9,053.88
1,137.62
0
10,191.50
22,043.56
578.71
0
22,622.27
14,979.26
1,145.07
0
16,124.33
4,611.19
1,522.32
0
6,133.51
10,830.00
249.18
0
11,079.18
4,627.50
149.95
100.00
4,877.45
11,107.50
225.00
0
11,332.50
5,865.00
0
0
1
6,585.00
135.05
625.00
7,345.05
4,417.50
113.90
0
4,531.40
3,470,456.87
45,500.00
866,334.48
1,250.00
0
4,384,051.35
0
1,377,956.97
8,750.00
710,303.67
1,250.00
0
2,104,106.25
0
1,476,561.48
46,250.00
7,980,281.22
1,250.00
0
9,504,642.70 1
0 I
10,001,080.16
3,993,000.00
25,918,225.14
19,699,472.77
0
0
1 19,699,472.77 1 25,918,225.14
1
0
9,308.79
75,889.12
0
85,197.91
1,716,026.57
17,500.00
682,052.94
1,250.00
0
2,416,839.51
0
1
1
1
!
i
1,896,052.41
1 Los Angeles
Portland
Topeka
L i t t l e Rock
$
o
$
0
563,578.22
10,125.00 1
40,000.00
1,250.00
0
614,953.22
0
2,283,632.26
235.00
4,004,075.02
34,375.00
804,876.82
1,250.00
1,000,000.00
5,844,811.84
0
2,494,687.50
6,483,922.08 1
0
6,483,922-08 j
17,199,807.82
2,635.00
17,202,442.82
6,156.00
20,550.26
0
26,706.26
82.19
5,692.96
9,221.24
23.24
15,019.63
6,073.01
1,126.65
18.00
7,217.66 !
632.87
1,191.67
0
1,824.54
9,863.83
1,114.43
0
10,978.26
3,412.50
0 1
0
3,412.50 |
2,977.50
150.00
0
3,127.50
5,130.00
471.19
446.25
6,047.44
|$ 2 4 , 1 1 6 , 8 3 1 . 1 6 |$ 4 0 , 4 5 8 , 6 9 4 . 2 9 $ 2 0 , 4 3 2 , 9 2 6 . 3 1 $ 4 4 , 9 1 0 , 2 4 5 . 5 5 $ 2 0 , 3 7 6 , 8 1 0 . 8 7 $ 1 5 , 5 8 3 , 9 4 0 . 5 1 $ 1 4 , 8 7 5 , 1 2 4 . 9 8 $ 9 , 4 1 4 , 1 6 5 . 8 6
& 25,573,987.49
$
4,010,200.00 $
744,625.46
29,650.00
0
4,784,475.46
3,112,430.75 $
295,570.86
2,750.00
1,000,000.00
4,410,751.61
4,675,607.17 $
0
9,925.00
0
4,685,532.17
751,000.00 $
40,000.00
2,000.00
0
793,000.00
4,290.62
0
35,000.00
39,290.62
2,177.28
0
62,583.33
64,760.61
7,625.50
82.19
24,583.30
32,290.99
5,925.70
0
74,583.32
80,509.02
332.03
0
37,500.00
37,832.03
0
0
18,333.33
18,333.33
92,082.00
35.418.12
127,500.12
127,757.00
70.652.31
198,409.31
49,330.50
19,234.74
68,565.24
141,739.00
43,960.00
185,699.00
73,949.00
20,125.54
94,074.54
43,862.00
10,043.56
53,905.56
1,148,406.68
0
4,475.00
0
1,152,881.68
1
5,865.00
0
17,095.20
24,687.94
0
4 1 , 7 8 3 . 1 4 j1
$
0 $
83,254.83
0
0
83,254.83
11,247.22
6,979.05
1 8 , 2 2 6 . 2 7o
685,375.00 $
143.39
2,075.00
0
687,593.39
0
5,000.00
0
0
5,000.00
1,721.44
0
21,250.00
22,971.44 j
0
10,125.00
10,125.00
0
0
45,208.32
45,208.32
37,250.00
6,722.95
43,972.95
0
0
0
0
0
0
$
505,000.00
499,648.29
3,750.00
0
1,008,398.29
0
0
0
0
351.00
0
0
0
752.77
17,031.33
32,182.42
9,713.60
45,182.45
12,812.53
6,823.03
7,421.85
5,695.37
27,721.51
3,500,000.00
3,000,000.00
2,500.000.00
9,000,000.00
9,100,000.00
2,750,000.00
2.500,000.00
14,350,000.00
1,750,000.00
2,000,000.00
2,500,000.00
6,250,000.00
9,250,000.00
8,000,000.00
3,000,000.00
20,250,000.00
2,000,000.00
3,000,000.00
4,500,000.00
9,500,000.00
2,000,000.00
500,000.00
1,500,000.00
4,000,000.00
2,000,000.00
750,000.00
2,000,000.00
4,750,000.00
2,025,000.00
0
0
2,025,000.00
6,875,000.00
3,500,000.00
1,000,000.00
11,375,000.00
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
10,336,703.75
19,429,827.80
10,771,321.44
25,246,922.64
10,438,070.10
4,162,316.75
5,467,986.68
2,089,793.32
12,457,080.89
3,747,700.00
4.100.00
3,751,800.00
1.550.00
3,750,250.00
9.208.200.00
j 12,958,450.00
7,115,000.00
36,900.00
7,151,900.00
16.150.00
7,135,750.00
12.775.700.00
19,911,450.00
2,633,500.00
7.500.00
2,641,000.00
1,875.00
2,639,125.00
6.577.400.00
9,216,525.00
4,473,800.00
26.600.00
4,500,400.00
7,175.00
4,493,225.00
14,173,900.00
18,667,125.00
2,124,800.00
11,800.00
2,136,600.00
4,025.00
2,132,575.00
7,394,900.00
9,527,475.00
2,023,400.00
7,700.00
2,031,100.00
1,925.00
2,029,175.00
8,772,400.00
10,801,575.00
1,651,400.00
8.100.00
1,659,500.00
2,725.00
1,656,775.00
7,333,600.00
8,990,375.00
1,083,500.00
0
1,083,500.00
0
1,083,500.00
5,960,000.00
7,043,500.00
2,657,900.00
0
2,657,900.00
0
2,657,900.00
9,967^900.00
12,625,800.00
321,958.92
44.474.22
366,433.14
455.244.27
821.677.41
13,780,127.41
632,195.26
97,311.78
729,507.04
387.909.45
1.117.416.49
21,028,866.49
242,550.08
0
242,550.38
202.529.49
445.079.87
9,661,604.87
537,898.58
0
537,898.58
458,299.33
996,197.91
19,663,322.91
235,382.28
0
235,382.28
175,883.49
411,265.771
9,938,740.77
255,396.10
0
255,396.10
364,652.66
620.048.76
11,421,623.76
158,712.55
0
158,712.55
258,050.75
416,763.30
9,407,138.30
136,055.38
0
136,055.38
144,817.16
280.872.54
7,324,372.54
204,129.77
100,000.00
304,129.77
186,976.83
491,106.60
13,116,906.60
15,583,940.51 $
14,875,124.98 $
9,414,165.86 $
25,573,987.49
1
$24,116,831.16
**
$ 40,458,694.29 $
20,432,926.31 $
44,910,245.55 $
0
20,376,810.87 $
Consolidated Federal Home Loan Bank Debentures issued by the Federal Home Loan Bank Board and now outstanding are the j o i n t and several
obligations of a l l Federal Home Loan Banks.
February 1939
163
Supplemental Table B.—Statement cf profit and loss for the Federal
New Y o r k
Boston
Combined
Consolidated
Pittsburgh
GROSS OPERATING INCOME:
$
Interest
e a r n e d on d e p o s i t s
-
other
F.H.L.
Banks
. . . .
Gross O p e r a t i n g Income
LESS -
OPERATING CHARGES:
Interest
on d e p o s i t s
-
other
F.H.L.
6,108,288.42
802,068.61
0
$
251,838.85
58,079.99
32,260.27
$
619,049.39
56,564.83
8,798.62
$
593,342.68
84,248.99
0
6,952,957.02
342,179.11
684,412.84
677,591.67
906,745.73
906,745.76
1,150,723.89
79,143.06
39,114.66
201,140.15
42,599.96
302,439.70
60,429.87
0
0
1,736.76
16,540.77
0
21,897.53
122,357.94
0
0
1,736.77
34,903.43
0
31,200.21
111,730.71
113,866.57
6,831.54
3,997.85
3,733.94
123.29
26,026.51
2,721,907.18
2,679,307.19
ADD -
$
6,910,357.03
79,143.06
39,114.66
201,140.15
0
302,439.70
Banks
6,108,288.42
802,068.61
42,599.99
100,604.93
190,198.35
266,310.41
$
4,231,049.84
$
241,574.18
$
494,214.49
$
411,281.26
$
556,428.37
75,000.00
555.62
$
90,768.22
4,807.50
0
$
25,293.77
8,625.00
0
$
75,000.00
555.62
0
6,615.00
0
631,983.99
631,983.99
95,575.72
33,918.77
6,615.00
82,419.29
718.76
82,419.29
718.76
0
0
0
0
159.81
0
NONOPERATING INCOME:
LESS -
NONOPERATING CHARGES:
Loss
on s a l e
of
investments
83,138.05
NET INCOME
DETAIL OF COMPENSATION,
0
0
83,138.05
159.81
H 4,779,895.78
$
4,779,895.78
$
337,149.90
$
528,133.26
$
417,736.45
$
*
36,635.00
261,713.14
43,810.92
251,001.75
$
2,500.00
25,750.00
3,200.00
8,840.00
$
5,130.00
24,200.04
6,000.00
42,099.84
9
3,250.00
30,100.00
5,300.00
49,047.34
TRAVEL AND OTHER EXPENSES:
COMPENSATION:
Directors' fees
Officers* salaries
36,635.00
261,713.14
43,810.92
251,001.75
593,160.81
593,160.81
40,290.00
77,429.88
77,697.34
28,261.22
34,459.66
17,118.24
28,261.22
34,459.66
17,118.24
1,161.81
3,400.85
19.50
2,266.06
4,148.71
3,907.51
3,398.85
3,499.20
1,844.15
79,839.12
79,839.12
4,582.16
10,322.28
8,742.20
20,625.30
20,151.66
7,298.93
26,597.76
21,268.16
16,457.89
20,625.30
20,151.66
7,298.93
26,597.76
21,268.16
16,457.89
1,032.92
714.15
348.68
1,000.79
1,619.18
225.09
2,533.58
2,894.10
2,482.52
4,277.47
2,675.85
3,068.33
2,799.98
2,274.01
198.88
2,190.64
2,345.03
707.27
49,736.70
37,256.52
34,352.88
49,736.70
37,256.52
34,352.91
3,200.04
2,391.19
5,025.67
7,649.96
6,222.52
2,801.45
6,506.08
5,027.71
3,241.57
TRAVEL EXPENSE:
Officers
Other
OTHER EXPENSES:
Heat,
Rent -
light»
less
power,
rental
ice,
etc.
. . ,
charged Examining D i v i s i o n
-
Federal
233,745.80
TOTAL
-
. $
906,745.73
233,745.83
$
906,745.76
15,557.71
$
60,429.87
25,291.17
34,605.78
$
122,357.94
$
111,730.71
_ _
Analysi s of
SURPLUS - RESERVE SECTION 1 6 OF ACT:
C r e d i t B a l a n c e - December 3 1 , 1937
Add:. 2 0 # N e t E a r n i n g s Y e a r 1 9 3 8
C r e d i t Balance - December 3 1 , 1938
SURPLUS Credit
RESERVE FOR CONTINGENCIES:
B a l a n c e - D e c e n b e r 3 1 , 1937
Credit Balance -
December 3 1 ,
1938
UNDIVIDED PROFITS:
C r e d i t B a l a n c e - December 3 1 ,
Add: P r o f i t - Y e a r 1938
1937
Deduct:
$
Dividends
Adjustment
declared year
Dividends
-
$
0
262,021.01
262,021.01
1938
1937
$
164
2,876,819.56
955,979.17
3,832,798.73
2,327,598.00
4,779,895.78
6.61
4,779,902.3.9
2,405,622.44
955,979.17
262,021.01
1.24
3.623.623.86
3,483,876.53
2,876,819.56
955,979.17
3,832,798.73
$
0
262,021.01
262,021.01
S
2,327,598.00
4,779,895.78
6.61
4,779,902.39
2,405,622.44
955,979.17
262,021.01
1.24
3,623,623.86
3,483,876.53
9
169,594.05
67,429.98
237,024.03
$
•
403,433.74
105,626.66
509,060.40
$
"
278,887.79
83,547.29
362,435.08
I ,
|
0
0
0
0
0
20,235.01
20,235.01
b
86,630.46
337,149.90
0
337,149.90
239,317.67
67,429.98
0
0
306,747.65
117,032.71
221,467.67
528,133.26
0
528,133.26
345,971.89
105,626.66
20,235.01
0
471.833.56
27?,7Q1.37
255,932.30
417,736.45
0
417,743.06
135,415.05
83,547.29
0
0
218.962.34
454,713.02
$
_^
Surplus
o 1
$
Federal Home Loan Bank Review
Home Loan Banks for the period Jan. 1 , 1 9 3 8 , through Dec. 3 1 , 1 9 3 8
Cincinnati
Indianapolis
ft 624,423.67
40,887.10
0
665,310.77
ft 837,368.33
122,837.03
0
960,205.36
ft 370,785.61
80,326.99
160.27
451,272.87
74,414-39
125,500.29
8,016.04
3,593.34
7,655.77
197,26
26,561,68
104,680.43
167,307.17
14,790.66
4,340.64
32,889.33
739.72
39,276.49
57,734.92
95,012.69
5,592.75
3,252.11
23,952.03
7,602.70
20,419.71
Winston-Salem
$ 1,038,144.37 ft 489,096.49
79,735.18
56,824.27
16.44
135.62
568,848.11
1,095,104.26
845,938.77
364,024.44
494,290.37
256,478.67
419,372.00
ft 596,180.92
$
237,705.96
ft
600,813.89
ft 312,369.44
ft
44,474.22
6,585.00
0
ft 121,639.72
10,830.00
0
ft
29,944.31
4,627.50
119.75
$
111,277.33 ft.
11,107.50
8.20
|
51,059.22
132,469.72
34,691.56
122,393.03
0
5,865.00
0
5,865.00
0
0
0
45,494.38
718.76
3,233.85
0
o
0
46,213.14
ft 470,431.22
$ 728,650.64
$
226,184.38
ft
b
1,925.00
18,800.00
2,800.00
23,724.18
ft
&
2,020.00
14,520.00
3,010.00
18,011.67
$
1
47,249.18
69,590.27
2,698.01
4,309.34
4,101.89
f
$
213,566.91
Los Angeles
l
320,348.25
68,073.61
0
388,421.86
ft 323,125.57
35,819.43
0
358,945.00
ft 210,637.50
48,500.49
0
259,137.39
ft 430,127.71
70,170.70
1,228.77
501,527.18
|
75,435.41
47,159.84
3,350.16
2,696.06
0
850.68
18,584.74
148,076.89
53,170.72
54,827.93
3,047.71
2,924.74
6,490.73
1,097.26
16,081.61
40,808.55
14,979.28
2,024.11
2,007.95
0
131.52
13,934.08
137,640.70
73,885.49
$
240,344.97
ft 221,304.30
ft 185,252.50
71,223.36
119,757.36
8,925.04
3,449.69
4,987.65
0
22,548.15
230,891.25
ft 270,635.93
ft
0
4,417.50
302,67
ft
$
$
$
56,465.41
153,702.09
9,004.78
4,255.07
9,471.80
0
23,579.52
78,294.05
258,610.67
17,560.27
5,123.68
60,514.70
31,857.53
42,329.47
Portland
Topeka
Little Rock
Des Moines
Chicago
0
3,412.50
0
0
2,977.50
0
133,030.80
5,130.00
125.00
4,720.17
3,412.50
2,977.50
138,285.80
0
0
0
0
12,500.00
0
0
0
21,031.25
0
3,233.85
0
0
12,500.00
0
21,031.25
719,973.07
ft 318,234.44
ft 188,230.00
ft 387,890.48
ft
$
$
245,065.14
$
212,216.80
ft
3,145.00
27,799.96
3,300.00
16,542.50
$
3,900.00
15,100.00
1,800.00
13,054.93
1,660.00
14,630.00
2,400.00
8,324.54
2,975.00
22,471.66
4,200.00
18,191.32
3,280.00 ft
26,091.48
3,799.92
15,866.16
2,850.00
22,000.00
3,000.00
6,960.00
37,561.67
49,037.56
34,810.00
50,787.48
33,854.93
•27,014.54
47,837.98
2,395.95
2,534.61
1,436.94
1,599.34
1,567.55
2,666.93
1,807.33
1,329.23
132.06
2,860.44
2,605.32
125.82
3,290.84
3,614.23
693.76
3,277.64
1,497.75
751.80
1,579.90
1,829.48
1,397.08
1,925.05
4,123.39
41.00
11,109.04
6,367.50
5,833.82
3,268.62
5,591.58
7,598.83
5,527.19
4,806.46
6,089.44
1,719.96
2,023.21
251.46
2,695.11
1,012.77
349.78
2,171.22
2,082.18
867.23
3,591.19
2,196.10
1,171.34
1,484.46
1,307.27
436.02
1,157.27
1,582.81
440.01
1,493.95
2,374.99
1,331.12
2,373.67
1,916.48
2,127.87
823.48
750.91
298.30
2,019.15
1,437.62
1,625.75
3,058.93
1,593.20
731.18
2,018.09
2,243.02
1,960.36
955.51
889.35
0
1,488.77
1,331.13
2,243.63
901.20
636.48
0
1,000.97
1,396.89
500.25
1,650.11
2,611.81
353.54
2,784.64
1,511.28
2,038.21
2,865.00
3,384.07
1,754.81
7,200.04
5,693.13
3,750.23
3,180.00
2,232.44
2,519;15
5,034.62.
5,004.13
4,331.04
3,999.96
1,621.13
3,487.53
1,800.00
1,463.03
2,181.31
4,200.00
1,532.90
1,147.31
2,721.00
688.64
1,142.12
1,380.00
1,995.63
2,970.72
4,000.00
30,250.00
5,001.00
30,339.27
16,056.17
28,722.66
74,414.39
ft 104,680.43
and Undivided
1
!
|
13,788.60
25,987.87
16,063.83
$
57,734.92
ft
78,294.05 $
56,465.41
ft
75,435.41
ft
53,170.72
ft
40,803.55
$
71,223.36
$
197,313.50
45,236.88
242,550.38
ft
393,903.96 $
143,994.62
537,898.58
171,735.39
63,646.89
235,382*28
ft
206,383.08
49,013.02
255,396.10
ft
116,269.19
42.443.36
158,712.55
ft
98,409.38
37,646.00
136,055.38
ft
126,551.67
77,578.10
204,129.7?
14,339.43
17,049.12
17,295.94
8,987.55
Profits
ft 227,872.68
94.086.24
321,958.92
ft 486,465.13
145,730.13
632,195.26
0
44,474.22
44,474.22
0
97,311.78
97,311.78
0
0
0
0
0
0
0
0
0
0
0
0
250,874.87
470,431.22
0
j 470,431.22
127,500.12
94,086.24
44,474.22
1.24
268.061.82
$ 455,244.27
296,842.57
728,650.64
0
728,650.64
394,541.85
145,730.13
97,311.78
0
637.583.76
$ 387,909.45
158,135.03
226,184.38
0
226,184.38
136,553.04
45,236.88
0
0
181,789.92
202,529.49
251,338.52
719,975.07
108,213.08
318,234.44
0
318,234.44
186,917.14
63,646.89
0
0
250,564.03
175,883.49
February 1939
$
o
$
719,973.07
369,017.64
143,994.62
0
0
513,012.26
458,299.33 $
S
275,901.66
245,065.14
0
245,065.14
107,301.12
49,013.02
0
0
156,314.14
364,652.66 ft
0
0
0
0
177,023.31
212,216.80
0
212,216.80
88,746.00
42,443.36
0
0
131,189.36
258,0*0.75
81,892.81
188,230.00
0
188,230.00
87,659.65
37,646.00
0
0
125,305.65
144;817.16
0
0
100,000.00
100,000.00
0
8
ft
163,345.72
387,890.48
0
387,890.48
166,681.27
77,578.10
100,000.00
0
364,259.37
186,976.83 ""
165
Counsel's Opinions and Board Resolutions
D I G E S T OF A - B - C
BOOK O P I N I O N
l
AMORTIZED LOANS—Definition
of. Char. E , Sec.
12; Char. K, Sec. 14.
Under the provisions of Charter E, Section 12, an amortized loan must be payable in equal monthly installments
sufficient to retire the indebtedness, interest and principal,
in not less than five nor more than 20 years. The only
justifiable difference in the amount of monthly payments is
such slight variations of the first or last payment as may be
necessary to adjust the loan plan to a regular periodic monthly
basis.
Section 14 (a) of Charter K describes an amortized loan
within the meaning of that charter. Under this section,
monthly payments may be either equal or unequal but must
be sufficient to retire the debt, interest and principal, within
20 years. No loan contract under this section can provide
for any subsequent monthly installment in an amount larger
than any previous monthly installment.
The amortization payments required by both Charter E
and Charter K must be applied monthly, first to interest on
the unpaid balance of the debt and the remainder to the reduction of the debt until the same is paid in full. These
provisions require monthly application of such payments,
and ''interest on the unpaid balance", as used therein, means
interest on the unpaid balance during the preceding month,
thus requiring monthly computation of interest on the unpaid
balance in all such cases.
As stated above, no amortized loan made under either
Charter E or Charter K may provide for a subsequent
monthly payment in excess of any previous monthly installment. Similarly, no amortized loan under either charter
can require an additional payment on principal at any time
during the life of the loan regardless of whether such extra
payment takes the place of, or is in addition to, the regular
monthly installment.
This opinion replaces A-B-C Book Opinion, C-051.
(A-B-C Book, C-051, May 27, 1938)
ASSOCIATIONS—Dividend credit or payment and bonus credit on share account transferred.
Char. K, Sees. 7, 9, 10; Char. E , Sees. 6, 7.
Savings and Loan Insurance Corporation adopted
resolutions approving Standard Form No. 22 of
Savings and Loan Blanket Bond as an acceptable
form of Fidelity bond for use by Federals in complying with Section 102.012 of the Rules and Regulations for the Federal Savings and Loan System
and by member insured institutions in complying
with Section 201.016 of the Rules and Regulations
for Insurance of Accounts.
PROPOSED AMENDMENTS TO RULES AND REGULATIONS
FOR
FEDERAL SAVINGS AND LOAN SYSTEM AND FOR
INSURANCE
OF
ACCOUNTS,
RELATIVE
TO
LOANS
BEYOND THE 50-MILE AREA.
The Federal Home Loan Bank Board on January
31 passed a resolution proposing to amend subparagraph (1) of paragraph c of Section 103.012 (old
Section 41 (c) (1) ) of the Rules and Regulations for
the Federal Savings and Loan System to read as
follows:
(1) The real estate security for any such loans shall be
appraised as directed by the charter; and the compensation of
the appraisers shall not be affected by the granting or declining
of the loan.
A similar resolution proposing to amend subparagraph (2) of paragraph d of Section 201.011 (old
Section 10 (d) (2) ) of the Rules and Regulations for
Insurance of Accounts as follows, was adopted by
the Board of Trustees of the Federal Savings and
Loan Insurance Corporation on the same date.
FEDERAL
A transferee of a share account in either a Charter
E or Charter K Federal association has the same rights as to
dividend credits or payments and bonus credits as the transferor would have had if such transfer had not been made.
Under the provisions of Sections 6 and 7 of Charter E and
Sections 7, 9, and 10 of Charter K no cessation of dividend
credits or payments or bonus continuity may be effected by
a Federal association because of a transfer of a share account.
(A-B-C Book, C-016, April 7, 1938)
BOARD
RESOLUTIONS
On January 12,1939, the Federal Home Loan Bank
Board and the Board of Trustees of the Federal
» In requesting copy of digests, their A-B-C Book reference number and date
should be cited.
166
(2) It must be appraised by at least two qualified persons
and the compensation of such persons shall not be affected in
any way by the granting or declining of the loan.
A recently adopted regulation 1 of the Board provided for the publication in the earliest possible issue
of the R E V I E W of all proposed amendments affecting
a matter of general principle or policy and not of an
emergency character. The amendments listed above
which will affect the regulations relative to loans by
Federals and insured institutions beyond the 50-mile
lending limit are presented in accordance with this
provision. They will not be approved by the Board
until at least 30 days after the mailing date to the
Advisory Council (Feb. 3, 1939).
» See December 1938 REVIEW, pp. 85-87.
Federal Home Loan Bank Review
Directory of Member,
Federal, and Insured Institutions
Added during December-January
CANCELATIONS OF FEDERAL SAVINGS AND LOAN ASSOCIATION CHARTERS BETWEEN DECEMBER 16, 1938,
AND
JANUARY 15,
1939
COLORADO:
Glenwood Springs:
First Federal Savings & Loan Association of Glenwood Springs (voluntary dissolution).
ILLINOIS:
I. INSTITUTIONS ADMITTED TO MEMBERSHIP IN
THE FEDERAL HOME LOAN BANK SYSTEM BETWEEN DECEMBER 16, 1938, AND JANUARY 15,
1939 *
[Listed by Federal Home Loan Bank Districts, States, and cities]
DISTRICT NO. 3
PENNSYLVANIA:
Philadelphia:
Burton C. Simon Building & Loan Association, Corner Twentieth Street
& Passyunk Avenue.
E. F. Houghton Building & Loan Association, 240 West Somerset Street.
D I S T R I C T NO. 4
MARYLAND:
Baltimore:
Bond Street Perpetual Building Association of Baltimore City, Corner
Broadway & Gay Streets.
DISTRICT NO. 5
OHIO:
Millersburg:
Holmes County Savings & Loan Company, West Jackson Street.
WITHDRAWALS FROM THE FEDERAL HOME LOAN BANK SYSTEM BETWEEN DECEMBER 16, 1938, AND JANUARY 15, 1939
CALIFORNIA:
Inglewood:
People's Building & Loan Association, 150 South Market Street (voluntary withdrawal and cancelation of insurance).
ILLINOIS:
Chicago:
Lithuanian Building, Loan & Homestead Association (voluntary withdrawal).
MARYL AN D.-
Baltimore:
New Baltimore Loan & Savings Association of Baltimore City (voluntary withdrawal).
MASSACHUSETTS:
Boston:
Federal Cooperative Bank (voluntary withdrawal).
N E W JERSEY:
Hoboken:
American Homes Building & Loan Association of Hoboken, N . J. (voluntary withdrawal).
Dormont:
Dormont Building & Loan Association (voluntary withdrawal).
Shamokin:
Black Diamond Building & Loan Association of Shamokin (merger with
West Ward Building & Loan Association of Shamokin, Shamokin,
Pennsylvania).
II. FEDERAL SAVINGS AND LOAN ASSOCIATIONS
CHARTERED BETWEEN DECEMBER 16, 1938,
AND JANUARY 15, 1939
D I S T R I C T NO. 2
N E W YORK:
Brooklyn:
Mutual Federal Savings & Loan Association of Brooklyn, 312 Ashland
Place (converted from Brooklyn Mutual Building & Loan Association).
DISTRICT NO. 3
PENNSYLVANIA:
Carnegie:
First Federal Savings & Loan Association of Carnegie, 242 East Main
Street (converted from Fidelity Building & Loan Association of Carnegie).
DISTRICT NO. 10
KANSAS:
Wichita:
Sedgwick County Federal Savings & Loan Association of Wichita, 207
South Broadway (converted from National Savings and Loan Association).
i During this period 2 Federal savings and loan associations were admitted to
membership in the System.
MINNESOTA:
Hibbing:
Hibbing Federal Savings & Loan Association (voluntary dissolution).
PENNSYLVANIA:
Cynwyd:
Bala-Cynwyd Federal Savings & Loan Association (merger with Ben*
jamin Franklin Federal Savings & Loan Association, Philadelphia,
Pennsylvania).
Philadelphia:
Anchor Federal Savings & Loan Association (merger with Benjamin
Franklin Federal Savings <fr Loan Association, Philadelphia, Pennsylvania).
City of Penn Federal Savings & Loan Association (merger with Benjamin Franklin Federal Savings & Loan Association, Philadelphia,
Pennsylvania).
Householders' Federal Savings & Loan Association (merger with
Benjamin Franklin Federal Savings & Loan Association, Philadelphia,
Pennsylvania).
III. INSTITUTIONS INSURED BY THE FEDERAL
SAVINGS AND LOAN INSURANCE CORPORATION
BETWEEN DECEMBER 16, 1938, AND JANUARY
15, 1939
DISTRICT NO. 2
N E W JERSEY:
Hoboken:
Haven Building & Loan Association of Hoboken, New Jersey, 41 Newark
Street.
Westfield:
Mutual Building & Loan Association of Westfield, N. J.. 112 Elm Street.
DISTRICT NO. 3
P E N N SYLV ANT A.-
Philadelphia:
Holmesburg Building Association, 7930 Frankford Avenue.
North East Federal Savings & Loan Association, 1847 East Allegheny
Avenue.
D I S T R I C T NO. 4
GEORGIA:
Rome:
Rome Building & Loan Association, 201 Broad Street.
DISTRICT NO. 5
OHIO:
PENNSYLVANIA:
February 1939
Monmouth:
Security Federal Savings & Loan Association of Monmouth (voluntary
dissolution by sale of assets to Fidelity Federal Savings & Loan Association, Galesburg, Illinois).
Xenia:
Peoples Building & Savings Company. 11 Green Street.
TENNESSEE:
Chattanooga:
Chattanooga Federal Savings & Loan Association, 117 East Eighth
Street.
DISTRICT NO. 7
ILLINOIS:
Chicago:
Chicago Lithuanian Savings & Loan Association, 2502 West Sixty-ninth
Street.
Deerfield:
Deerfield Building & Loan Association, 841 Waukegan Road.
Watseka:
Watseka Building & Loan Association, 109 South Second Street.
DISTRICT NO. 8
NORTH DAKOTA:
Grand Forks:
First Federal Savings & Loan Association of Grand Forks.
DISTRICT NO. 10
OKLAHOMA:
Duncan:
Duncan Building & Loan Association, 906 Main Street.
DISTRICT NO. 12
CALIFORNIA:
Inglewood:
Peoples' Federal Savings & Loan Association, 150 South Market Street„
Santa Rosa:
Santa Rosa Building & Loan Association, 629 Fourth Street.
167
Review of 1938
F. H. L. B. System
(Continued from p. 144)
(Continued from p. 152)
which reflect graphically the trend of security for
long-term mortgages, based on the theory that
desirability in neighborhoods is a predominant factor
in sound residential lending.
The most useful surveys break down pertinent information obtained for a city as a whole and correlate it to various geographic areas within the city.
Such area surveys include analyses of the volume
and type of lending, the distribution of the business
among the different lenders, population trends, real
estate conditions, transportation, utility rates, taxation, and other factors affecting mortgage security.
I t is this trend on the part of management to analyze
the basic economic elements of the community which
support, influence, and forecast probable conditions
in the mortgage field which constitutes an outstanding challenge to lenders during 1939.
Savings and loan executives cannot afford to
overlook the factors which may alter the present
outlook completely. There is still considerable
uncertainty with regard to the status and outcome
of international differences. The effect of world
affairs upon general business conditions is evident
from the experience preceding and immediately
following the Munich conference last September.
The momentary pause, then, which checked commercial activity if only for a short time, is an indication of the influence of world conditions upon
public opinion.
Further, unpredictable increases in building costs
would undoubtedly undermine the rise in construction activity. Because the economic structure is
depending upon the housing revival and the expansion of the heavy industries, disruption of these
might readily jeopardize the upward trend of the
entire statistical pattern.
Serious though these obstacles may be, it must be
remembered that they are for the moment, hypothetical. If they remain possibilities and do not
become actualities, the savings and loan industry
may well mark 1939 as an even more eventful and
prosperous year than 1938.
to the 200 million dollar mark reached on December
31, 1937, the balance of $198,842,000 at the close
the year was slightly more than $9,000,000 higher
than the amount reported on November 30 (Table 9).
Nearly twice as many advances were made in
December as in November, and all Banks except
the Boston Bank reported increases in advances outstanding. The Banks of Pittsburgh, Indianapolis,
Des Moines, Topeka, and Los Angeles reported a
larger balance of advances outstanding on December
31, 1938 than on December 31, 1937, while the
remaining seven Banks reflected lower balances.
168
INTEKEST R A T E S
The following table lists the interest rates in effect
on advances to members of the Federal Home Loan
Banks as of January 1, 1939. In the case of five of
the Banks, the effective interest rates are lower than
on January 1, 1938.
Interest rates on advances to membersl
Federal Home Loan
Bank
No. 1- -Boston
No. 2- -New York.
No.
No.
No.
No.
3—Pittsburgh
4—Winston-Salem_
5—Cincinnati
6—Indianapolis
No. 7—Chicago.
No.
No.
No.
No.
No.
8—Des Moines
9—Little Rock
10—Topeka
11—Portland
12—Los Angeles..
Rate in
effect
on Dec.
31, 1938
Type of loan
Percent
3 All advances.
2#l All short-term advances
amortized within one
year.
3 All other advances.
3M All advances.
3/ 2 All advances.
3 All advances.
3 All secured advances.
3H| All unsecured advances.
3Ji All secured advances.
3 « All unsecured advances.
3 All advances.
3 All advances.
3 All advances.
3/ 2 All advances.
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 per centum in excess of the current rates of interest prevailing for member institutions."
Federal Home Loan Bank Review
U. S. GOVERNMENT PRINTING OFFICE: I9S9
FEDERAL HOME LOAN BANK DISTRICTS
\OW
•—BOUNDARIES OF FEDERAL HOME LOAN SANK DISTRICTS
Q
FEDERAL HOME LOAN BANK CITIES.
OFFICERS OF FEDERAL HOME LOAN BANKS
CHICAGO
BOSTON
B.
J. ROTHWELL, Chairman; £ . H . W E E K S , Vice Chairman; W. H .
C. E . BROUGHTON, Chairman; H . G. ZANDER, JR., Vice Chairman; A. R.
FREDERICK
G A R D N E R , President; JOHN BARDWICK, J R . , Vice President-Treasurer;
W I N A N T , J R . , Treasurer; L. E . D O N O V A N , Secretary; P . A. H E N D R I C K ,
CONSTANCE M . W R I G H T , Secretary; LAURETTA Q U A M , Assistant Treas-
Counsel.
urer; UNGARO & SHERWOOD, Counsel.
NEAVES,
President;
H.
N.
FAULKNER,
NEW
Vice
President;
DES
YORK
C. B . B O B B I N S , Chairman; E . J. R U S S E L L , Vice Chairman; R. J. RICHARD-
G. L . BLISS, President; F . G. STICKEL, J R . , Vice President-General
SON, President-Secretary; W . H . LOHMAN, Vice President-Treasurer;
J. M . MARTIN, Assistant Secretary; A. E . MUELLER, Assistant
Treasurer; E . S. TESDELL, Counsel.
MACDONALD,
Counsel;
Chairman;
F.
R O B E R T G. CLARKSON,
V.
Vice
D.
LLOYD,
Vice
President-Secretary;
DENTON
C. L Y O N , Treasurer.
PITTSBURGH
E.
MOINES
Chairman;
GEORGE
LITTLE ROCK
T. TRIGG, Chairman; C. S. T I P P E T T S , Vice Chairman; R. H . R I C H ARDS,
President;
G.
R.
PARKER,
Vice
President;
H.
H.
G A R B EH,
J. G I L B E R T L E I G H , Chairman; W . C. J O N E S , J R . , Vice Chairman; B . H .
W O O T E N , President; H . D . W A L L A C E , Vice President; W . F . T A R V I N ,
Secretary-Treasurer; R. A. CUNNINGHAM, Counsel.
Treasurer; J. C. CONWAY, Secretary; W. H. CLARK, JR., Counsel.
WINSTON-SALEM
TOPEKA
G. W. W E S T , Chairman; E . C . BALTZ, Vice Chairman; O. K . L A R O Q U E ,
President-Secretary; G. E . WALSTON, Vice President-Treasurer; Jos. W.
HOLT, Assistant Secretary; RATCLIFFE, H U D S O N & FERRELL, Counsel.
G. E . M C K I N N I S , Chairman; P . F . G O O D , Vice Chairman; C . A. STERLING,
President-Secretary; R. H . BURTON, Vice President-Treasurer; JOHN
S. D E A N , JR., General Counsel.
CINCINNATI
PORTLAND
T H E O . H. T A N G E M A N , Chairman; W M . M E G R U E BROCK, Vice Chairman;
F. S. MCWILLIAMS, Chairman; B . H . HAZEN, Vice Chairman; F . H .
WALTER D . SHULTX, President; W. E . J U L I U S , Vice President;
DWIGHT
W E B B , J R . , Secretary; A. L. M A D D O X , Treasurer; T A F T , STETTINIUS &
JOHNSON,
President-Secretary;
IRVING
BOGARDUS,
Vice
President-
Treasurer; Mrs. E . M . SOOYSMITH, Assistant Secretary.
HOLLISTER, General Counsel; R. B . JACOBY, Assigned Attorney.
Los ANGELES
INDIANAPOLIS
F. S. CANNON, Chairman-Vice President; S. R. LIGHT, Vice Chairman;
FRED T.
GREENE,
President; B .
F. B U R T L E S S ,
JONES, HAMMOND, BUSCHMANN & G A R D N E R ,
Secretary-Treasurer;
Counsel.
C. H . W A D E , Chairman; D . G. D A V I S , Vice Chairman; M . M . H U R FORD, President; C. E . B E R R Y , Vice President; F . C. N O O N , SecretaryTreasurer;
VIVIAN
SIMPSON,
PATRICK, General Counsel.
Assistant
Secretary;
RICHARD
FITZ-
@FedFRASER