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FEDERAL
HOME
LOAN
BANK
Vol.
13, No. 5
Washington, D. C.
FEBRUARY 1947
IN THIS ISSUE
Savings and Loan Assets Passed $10 Billion
Summary of Mortgage Financing Activity
Home Construction at Record Level
The Pattern of New Savings
Background of Business Conditions
The A N N U A L
SURVEY in Bmf
Savings and loan assets passed $10 billion
The net growth in assets, share capital and mortgage portfolios of
savings and loan associations each exceeded $1 billion. Total assets
of the industry were estimated a t $10,041,000,000—up 15 percent.
Share accounts increased $1.1 billion, showing strong resistance to the
general slow-down in savings. Loan portfolios rose $1.7 billion to
reach $7.2 billion. Liquid assets were down to a b o u t one-fourth of
total resources which, although below the 1945 ratio, was considerably
higher t h a n the prewar ratio. [Page 131.]
Summary of mortgage financing activity
Real estate financing activity exceeded $10 billion—up 85 percent
from 1945 a n d double t h e 1941 volume. Commercial and m u t u a l
savings banks reported the largest percentage gains b u t savings and
loan associations held first place in total volume. T h e value of the
average recording was $4,200 compared with $3,400 in 1945. GI home
loans from April through December were equal to more t h a n onefourth of all mortgage recording activity. T h e home mortgage debt
rose 15 percent to reach $23 billion. [Page 137.]
Home construction at record level
More new privately financed homes and a p a r t m e n t s were started last
year t h a n in a n y year since 1928. Real progress was m a d e in stepping
up building material production. Rising construction costs during
1946 cast a shadow over future home building. The index of costs for
the s t a n d a r d house was up 15 percent. Wholesale building material
prices jumped as m u c h in N o v e m b e r and December as in the preceding
2)/2 years. [Page 141.]
The pattern of new savings
Despite higher income p a y m e n t s to individuals t h a n during even
the war years, the volume of net additions to savings in all media last
year was the smallest since 1941. Higher prices and the availability
of more consumer goods were the answers. With a single exception—
Series E savings bonds—savings in the various media showed increases
although in most cases the percentage and dollar gains were less t h a n
in 1945. [Page 145.]
The background of business conditions
In spite of " s t o p and g o " operations, new records were set for peacetime production. National income was higher than during the war
years and "full e m p l o y m e n t " became a reality.
Looking ahead to '47, the economic situation is generally favorable
although there are a n u m b e r of balancing factors to be considered.
Reduced consumer purchasing power and the state of labor-managem e n t relations are i m p o r t a n t . New gains in home building are predicted b u t a continued high rate will depend on construction costs.
The volume of real estate financing m a y decline in 1947 because of
fewer sales of existing properties. New construction loans m a y help
boost t h e home mortgage d e b t next year to a record $25 billion.
[Page 14.8.]
December highlights
The net increase ($160 million) in
savings account balances in savings
and loan associations was the largest shown during 1946. Although
seasonal influences were an import a n t consideration, the gain was $30
million more t h a n in the same 1945
month.
New loans m a d e by these institutions were down 7 percent from t h e
November total, b u t were still substantially above t h e 1945 level.
Construction loans displayed some
resistance to the decline.
The mortgage recording summary
of real estate financing under $20,000
also showed a seasonal drop of 4 percent. Insurance companies and commercial banks and trust companies
were t h e only mortgagees to report
a m o n t h - t o - m o n t h increase.
Private residential construction
activity was 24 percent below November on the basis of building
permits issued for nonfarm homes.
The 35,000 units to be provided by
these authorizations were one-fifth
higher t h a n in the same m o n t h of
1945 or 1941.
Construction costs a s measured
by the s t a n d a r d house index and the
BLS series on wholesale prices of
building materials continued to show
sharp increases.
The BLS index
was up 8 percent on t o p of a similar
rise in November.
T h e coal strike was t h e principal
factor in a 3-point drop of the FRB
industrial production index to 179
percent of the 1935-1939 average.
Net gab* in Shars Capital
01
,4
\ 1 I I„ I I 1 I I I,
F M A M 4 4 A 8,0
I
N D.
P»*Ufc.%
729543—47-
FEDERAL HOME LOAN BANK
in1
Contents
Page
55 No. 5
S A V I N G S A N D L O A N ASSETS PASSED $10 B I L L I O N .
131
S U M M A R Y OF M O R T G A G E F I N A N C I N G ACTIVITY.
137
H O M E CONSTRUCTION A T RECORD LEVEL
141
THE PATTERN OF NEW S A V I N G S
145
BACKGROUND O F BUSINESS CONDITIONS
148
FEBRUARY 1947
The Federal Home Loan Bank
Review is published monthly by
the Federal Home Loan Bank
Administration under the direction of a staff editorial committee.
This committee is responsible for
interpretations, opinions, summaries and other text, except
that which appears in the form of
official statements and signed
articles.
Communications concerning material which has been printed or
which is desired for publication
should be sent to the Editor of
the Review, Federal Home Loan
Bank Building, Washington 25,
D. C.
*
*
*
The Federal Home Loan Bank
Administration assumes no responsibility for material obtained
from sources other than itself or
other instrumentalities of the Federal Government.
•
•
Administrator
FEDERAL H O M E L O A N BANK
ADMINISTRATION
John H. Fahey, Commissioner
New family dwelling units
Building costs
Savings and loan lending
Mortgage recordings
Gl lending
F H A activity
Federal Home Loan Banks
Insured savings and loan associations
Share investments and repurchases
158-159
159-160
160-161
161-162
162
162
162
163
163
SPECIAL FEATURES
News notes
Worth repeating
Directory changes of member, Federal and insured institutions
Monthly survey
Amendments to rules and regulations
Contents of this publication
136
140
147
155
164
are not copyrighted
•
NATIONAL HOUSING AGENCY
Raymond M. Foley,
STATISTICAL D A T A
SUBSCRIPTION P R I C E OF R E V I E W . — A copy of t h e R E V I E W is sent to each
member and insured institution 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 the United States, Canada, Mexico, a n d t h e insular possessions, subscription price is $1.60 ; single copies, 15 cents. Subscriptions and orders
for individual copies should be sent w i t h remittances to the Superintendent
of
Documents, Government Printing Office, Washington
25, D. C.
APPROVED BY THE BUREAU OF T H E BUDGET
Federal Home Loan Bank Review
SAVINGS AND LOAN ASSETS PASSED
$10 BILLION
Despite repercussions arising out of the transition from a wartime to
a peacetime economy which were felt in every sector of thrift and
home finance, the past year witnessed new records in savings and
loan operations. The economic outlook points to a continued
high level of activity during 1947.
•
T H E record of accomplishments last year is
without precedent in the 115-year history of
savings and loan associations. For the first time,
the combined assets of these institutions passed
the $10-billion mark. New mortgage lending by
all savings and loan associations exceeded $3.5
billion—almost double the previous year's volume.
On the savings side, the net inflow of funds into
these institutions showed strong resistance to the
general slow-down in savings. The net gain of
$1.1 billon in savings accounts was another new
record in this phase of their operation.
The spotlight was on home building
On the basis of data compiled by the Bureau of
Labor Statistics, the facts show that 454,000 permanent, privately financed homes and apartments
were actually completed during 1946. At the end
of the year an additional 336,000 units of this
type were under construction. Starting "from
scratch" without the usual carry-over from the
preceding year and without inventories to assure
a steady flow of materials, the production of even
this amount of housing was an achievement for
which industry, labor and Government may take
credit.
The effective demand for places to live, however,
far outstripped the ability to produce new homes
and apartments, and the result was one of the most
serious inflations of real estate prices in our history.
Veterans and nonveterans alike were forced to buy
homes at any price to obtain shelter. Prices rose
at an ever-increasing rate throughout the early
months of the year. By mid-summer, however,
the atmosphere in the real estate market began
to change. Buyer resistance to higher prices
increased, as family after family worked out
a make-shift solution to its own housing problem.
Many mortgage lending institutions, aware of their
February 1947
responsibility for controlling the financial checkreins, began to tighten lending policies. As the
prospects for new construction grew brighter, the
pressure on existing houses was lessened. The
combined result was at least a temporary halt in
the upward trend of prices, and by the end of the
year many communities reported actuakdeclines.
Looking ahead
Mortgage financing operations in the coming
months will be greatly affected by the 1947
Housing Program, as recently announced by the
President. The emphasis on rental housing during
the current year presents new opportunities for the
financing of rental projects whether of the 1- to
4-family variety or the large-scale community-type
units. Elimination of price controls on building
materials as well as on new homes will have
a significant effect on construction costs. Eligibility of both veterans and non-veterans for new
owner-occupied homes will broaden the market for
this type of building and add to the demand for
small-home financing.
On the other side of the operating picture, the
general slow-down in new savings by the public
presents a new problem to associations which have
enjoyed, along with other financial institutions,
a steady inflow of new money during recent years.
Yet the requirements for home financing in 1947
make it imperative that every sound means be
used to stimulate increased savings investments.
" A billion dollar year"
Last year was truly a "billion dollar year" in
savings and loan operations. For the first time
the net growth in assets, share capital and mortgage portfolios each exceeded a billion dollars.
New business in savings accounts and loans closed
were at all-time peak levels. And to top it all, the
131
aggregate resources of these mutual thrift and
home financing institutions reached $10 billion
for the first time in their history.
From the start of the GI home loan program two
years ago, savings and loan associations have
accounted for a major portion of loans of this
type. By the end of last year, nearly $3 billion
in GI home loans had been approved by the
Veterans Administration. On the basis of these
figures, it is possible that as much as $1 out of
every $5 in loans on the books of these institutions
has been advanced on the home of a veteran.
Beginning the year with a substantial accumulation of cash and Government bonds, these institutions were in a particularly favorable position
to provide their share of the financial requirements
involved in the postwar demand for homes.
That their position as leaders in the home financing
field was maintained during 1946 is demonstrated
by the fact that they accounted for one-third of all
real estate financing of $20,000 or less, although
their share of the total was somewhat smaller than
in 1945.
Growth in assets
The combined assets of all savings and loan
members of the Bank System were pushing the
$9-billion mark at the end of 1946. An estimate
based on the latest available report from each
association placed the figure at $8,990,000,000 but
this will undoubtedly be revised upward when all
year-end reports are in. This was a gain of just
over $1,300,000,000 during the 12-month period—
slightly higher than the rise during 1945. k On a
percentage basis, however, the 1946 gain (17 perGROWTH IN ASSETS OF MEMBER
SAVINGS AND LOAN ASSOCIATIONS
Dollar Increase
FHLB Dists (thousands) o %
, Little Rock
$
PERCENT INCREASE 1 9 4 6 OVER 1 9 4 5
5
10
15
20
•
74,415
4
196,549
in^HiZi
10
58,691
^ ^ ^ ^ M
7
Chicago
162,546
3
Pittsburgh
2
New York
97,312
S
6
Indianapolis
174,518
81,349
85,928
United States 1,308,900
San Francisco
5
Cincinnati
1
144,711
^
~~""^^^~
^ ^ ^ ^ 1
™"j"2"J^~
j"j"^^^"™
n^Hn
™"~
""~[^™"™™
U^^^H^^^U
WSSSSSSJ Y/A
vsssssss/sssssss/s*
^^^^^^
163,048
69,834
FEDERAL
132
25
'
OPERATING ANALYSIS DIVISION
SAVINGS AND LOAN INSURANCE CORPORATION
cent) was slightly smaller than the 20-percent
jump in assets registered during 1945.
The chart on this page shows a District breakdown of the asset growth of all savings and loan
members of the Bank System. The largest
increase (almost 23 percent) was shown by associations in the Little Rock area, while those in the
Winston-Salem, Topeka, Chicago, Pittsburgh and
New York regions also had gains of more than
20 percent. Total member association assets in
four Districts (Cincinnati, San Francisco, WinstonSalem and New York) are now above a billion
dollars.
There was a net addition of three to the savings
and loan membership of the Bank System during
the year, bringing the total to 3,661. The average
size of the member associations took another substantial jump, moving from $2,100,000 at the
beginning of the year to $2,456,000 on December
31. Approximately 89 percent of the assets of all
operating savings and loan associations are now
within the Bank System membership. Nonmember resources at the end of 1946, estimated at
$1,051,000,000, brought the total assets of the
savings and loan industry to $10,041,000,000—an
increase of 15 percent during the year.
Increased savings invested by the public in these
institutions during the year accounted for by far
the major share of the 1946 growth. Indications
are that the non-savings liabilities (borrowed
money, loans-in-process accounts and other miscellaneous liabilities) did not play as large a part
in the growth last year as they did in 1945. Although Federal Home Loan Bank advances were
in unprecedented volume, these additional borrowings were offset to some extent by repayments
of money obtained from other sources.
All-time record for new lending
The whirlwind pace of the market in existing
residential properties and the revival of home construction during 1946 were reflected in a succession
of new records for savings and loan lending activity. The high point of lending during the
twenties by these institutions was 1928 when almost $2 billion was loaned for home financing
purposes; and until 1946 that figure had not been
exceeded. The 1946 total of $3,584,000,000 was
more than 85 percent above this peak. Making
the comparison with more recent years, the total
Federal Home Loan Bank Review
of loans made last year was within a few million
dollars of equaling the three-year total for 1939,
1940 and 1941.
Home purchase loans, amounting to $2,350,000,000 accounted for two-thirds of the total
savings and loan lending last year. This was an
increase of approximately $1 billion—or 74 percent
over the 1945 activity. Loans for new construction exceeded $600,000,000 for the first time, and
showed the largest percentage gain (241 percent)
registered by any of the five loan purpose classifications. Significant is the fact that 1946 construction loans were 40 percent above the 1941
level. In spite of this, this purpose accounted
for only $17 out of every $100 in new loans
made during 1946, compared with a ratio of
nearly $32 out of every $100 in the last prewar
year.
cing loans making up a greater share of the
balance of the lending.
Looking at the data for individual Federal
Home Loan Bank Districts, there were two
regions in which 1946 lending activity was more
than double that of the preceding year. The
largest percentage increase was registered in the
Winston-Salem District (116 percent). Associations in the Little Rock area ranked second with
an increase of 107 percent; those in the Boston,
New York and Indianapolis Districts were over
the 90-percent mark.
Savings and loan members of the Bank System
accounted for $93 out of every $100 of lending
by all associations during 1946; and insured
associations, $78 out of every $100.
Big sain in outstanding loans
Construction loans have loomed in greater
importance with the passing of each month
during the past two years. As shown in the
accompanying chart, in January 1945 construction loans amounted to only 4 percent of the
total lending, with home purchase loans accounting for 75 percent. The situation has been
gradually changing, however, and by the end of
last year construction loans made up nearly 20
percent of the aggregate volume, with loans for
the purpose of buying existing houses down to 63
percent of the total. In prewar 1941, home
purchase loans accounted for only 40 percent, and
those for construction, 30 percent—with refinanFebruary 1947
The net increase in the balance of loans on the
books of all operating savings and loan associations during 1946 is estimated at $1,700,000,000.
This gain for the 12-month period w^as just about
equal to the combined gains for the entire decade
from 1936-1945. The mortgage portfolios of
these institutions totaled well over $7 billion at
the end of the year—but were still below the peak
levels reached during the twenties. I t is difficult,
of course, to make direct comparison with that
pre-depression period because of the prevalent
use of the mortgage pledged share account method
of home financing. This system of accounting
had the effect of over-stating loan balances. After
adjustment for this factor, the loan balance at the
133
end of last year was substantially above the 1929
peak, which on a "net" basis was just over $6.5
billion.
Aggregate loan repayments (reductions of principal) were up considerably during 1946, rising
from approximately $1.4 billion in 1945 to more
than $1.9 billion. This was due in part to larger
loan portfolios and also to a high rate of prepayments on loans on property which changed hands
during the year. Relating the loan repayments
to the average balance of loans outstanding
during the year, the resulting turnover ratio was
approximately 30 percent—or about once in
three and one-half years. This was the fifth consecutive yearly increase in the turnover rate of
loan portfolios and indicates that, in spite of the
lengthening of terms for which loans are being
made, the average loan is not staying on the books
as long a t the present time as in the prewar period.
In 1940, the turnover rate for the savings and
loan mortgage portifolio was approximately once
in five years (21 percent).
Relating loan repayments to the volume of new
lending also throws light on another important
phase of association operations—the source of
funds for lending purposes. Last year, repayments of principal on mortgages on association
books amounted to approximately half of the
volume of credit extended on new loans. In 1945,
they were equal to about 72 percent of the new
loans made.
During the war, of course, when loan volumes
were relatively low, money flowing back into associations from outstanding loans was almost sufficient to take care of the demand for new financing.
The situation has now reversed itself, and the role
of the share capital accounts in providing loanable
funds takes on added importance.
Share capital up $1.1 billion
The other principal source of loanable funds—•
incoming share capital—continued to show satisfactory gains in spite of the general slow-down in
the rate of savings by the general public. Funds
invested in all savings and loan associations
were estimated at approximately $8.5 billion at
the end of 1946—a gain of slightly over $1.1
billion, or 15 percent, during the 12-month period.
The 1946 increase was about $100 million greater
than during the preceding year; b u t on a per134
centage basis the balance was moving upward, a t
a slightly slower rate.
A 34-percent increase in total new investments
sent the gross amount of new savings flowing
into these institutions above $3 billion for the
first time. However, a 55-percent gain in withdrawals, which totaled $2 billion, reduced the
net increase to the $1.1 billion outlined above.
As had been expected, the postwar trend of t h e
ratio of withdrawals to total new investments
has been upward, although there are some signs
of a leveling-off at present rates. The withdrawal
ratio for the second half of 1946 was 66 percent
against 62 percent in the first six months, and 58
percent in the last half of 1945.
REPURCHASE RATIOS
ALL OPERATING SAVINGS AND LOAN ASSOCIATIONS
PERCENT
^SEMI-ANNUAL PERIODS
70
1
in
ni
60
50
40
30
20
10
1
1
OPERATINS ANALYSIS D I V I 8 I O N
FEDERAL SAVINGS AND LOAN INSURANCE CORPORATION
Effect on liquidity positions
Throughout the war years, savings and loan
associations were accumulating funds to meet t h e
postwar demands for home financing. Most
associations continued to accept share capital
and to re-invest the funds in Government bonds
until such time as the prospects for new lending
were more favorable. I n 1946, however, the
"prospects" became borrowers, with the result
that the net increase in the loan portfolios was
substantially above the net gains in share capital.
Consequently, associations began to dip into this
reservoir of liquid assets which by the end of 1945
amounted to approximately one-third of their
total resources.
While it is not possible to present estimates for
all operating associations, the reports for all
Federal Home Loan Bank Review
insured associations shed some important light on
how far this trend has progressed. At the end of
1946, the cash and Government bonds held by all
insured associations still amounted to one-fourth
of their total resources compared with 35 percent
at the peak—a year earlier.
Recognizing the weaknesses of over-all averages, a special study has recently been made to
provide a more detailed breakdown and to highlight the extent of variation in individual association policies. Using reports as of the end of
October 1946 for 2,460 insured institutions, it was
found that 28 out of every 100 associations had
liquidity ratios of 30 percent or better, with 5
having more than half their total resources in
LIQUIDITY RATIOS"
ALL INSURED SAVINGS AND LOAN ASSOCIATIONS
SEMI-ANNUAL PERIODS
"*Co»h ond government obligations os a
percent of totol o»set».
cash or Government obligations. At the other
extreme, there were 21 associations out of every
100 which had remained at, or already returned to,
a liquidity ratio below 10 percent.
The size of the institution seemed to have a
definite relationship to the degree of its liquidity,
with larger associations showing a greater proportion of liquid resources than the smaller ones. I n
the smaller size groups, 27 associations out of
every 100 had ratios of less than 10 percent, while
the proportion under 10 percent for the $10,000,000-or-over group was only 8 to 100. I t is
recognized that smaller associations, particularly
those in less densely populated communities may
not require as high a degree of liquidity as do large
associations in concentrated metropolitan areas
where turnover of funds is usually more rapid.
February 1947
The analysis does serve to point up the fact,
however, that liquidity is a matter of considerably
more concern to some associations than to others,
for the full effect of postwar lending may yet be
in the future.
Trends in reserve accounts
When the final figures are available, it is quite
possible that the gradual downward trend in the
ratio of reserve and undivided profits accounts to
total assets may have been halted during the past
year. While associations have been adding substantial amounts to these accounts, the rate of
asset growth in the past few years combined with
the current level of dividend rates has made it
difficult to keep reserve accounts at the same proportionate level. In 1945, approximately $72
million was added to these residual accounts, and
the 1946 figure should exceed this by a comfortable
margin. For one thing, the resumption of largescale mortgage lending activities should increase
the average rate of return on association investments as the proportion of low-yielding liquid
assets returns to more normal levels. Also, the
fact that the rate of asset growth was somewhat
slower in 1946 than in the preceding year will
make it easier for reserve accounts to "catch u p / '
The role of public service
Not all of the success of associations last year
could be measured in terms of dollars and percent
changes. Savings and loan managers were helping in whatever way they could in their own communities to solve the housing crisis which greeted
returning veterans as they poured out of the
armed forces at the beginning of last year. The
savings and loan industry was represented on
most of the 700 Mayors' Emergency Housing
Committees.
In some cities, savings and loan executives
headed the group, as in such scattered areas as
Worcester, Massachusetts, and Rocky Mount,
North Carolina. I n others, they participated
through the subcommittees which specialized in
the financial aspects of veterans housing. I n
Yakima, Washington, and Ann Arbor, Michigan,
they helped to increase the supply of apprentice
labor by sponsoring a supervised program for high
school students. These activities emphasize again
the important role of public service played by
these institutions.
135
^^""^ZP3^
liliiv^
Forum on housing
held in Atlanta
Last December the savings and
loan associations in Atlanta, Georgia,
joined with a group of local realtors,
home builders and building supply
dealers to sponsor the city's first
public forum on housing. During
the week preceding the meeting, the
savings and loan backers carried
notices about it in their regular advertising. A panel of experts described how the forum's supporters
had cooperated to produce a record
volume of new homes for Atlanta
during the past few months and outlined prospects for 1947.
The initial meeting attracted over
200 persons and proved so successful
that the original panel of experts
agreed to participate in similar future
discussions planned by the sponsors.
In addition, arrangements are beingmade for a series of local radio programs on the subject.
Communities act against
unauthorized construction
Community action as a weapon
against unauthorized construction is
now enforced in more than 235 cities
and towns, according to a recent
statement issued by the Office of the
Housing Expediter. These localities
now require prospective builders to
obtain Federal authorization before
a city building permit is issued, or
emphasize that the local permit is
not valid until a Federal permit is
obtained.
This type of action, which got
under way in many municipalities
last summer, is even more important
now that the construction industry
is operating under a system of permits rather than priorities, Mr.
Creedon said in stressing the fact
that the revised system of authorization has not affected the most
important governmental building regulation—VHP Order No. 1, the
construction limitation order. "The
136
continuation of this order is indispensable to getting a large volume of
housing under way this year."
New N H A Coordinating
Council created
The establishment of an NHA
Coordinating Council was announced
late in January by NHA Administrator Raymond M. Foley. Set up
to coordinate more closely the housing activities of those Federal agencies now working in the field, the new
Council includes representatives of
the Department of Agriculture, the
Veterans Administration, the Reconstruction Finance Corporation, the
Federal Deposit Insurance Corporation, the Federal Home Loan Bank
System, the Federal Housing Administrator, the Federal Public Housing
Authority and the Office of the
Housing Expediter.
The primary purpose of the group
is to develop a unified approach to
interpretation of broad policies of the
Government on matters related to
housing. It will explore, for example, such difficult questions as reconciliation of varying techniques in
residential appraisal, study of longrange improvements such as model
building codes, and uniform mortgage
foreclosure laws and examination of
the over-all effect of legislative proposals. The Council will also consider ways to eliminate overlapping
functions in such fields as research
and statistics through more effective
exchange of information and agreement on the division of such work as
has a common bearing on the activities of the different agencies.
World needs 1 0 0 million
new homes
Over 100 million houses are needed
to meet the current shortage of living
quarters throughout the world, the
social division of the United Nations
estimated recently.
Primarily a
result of the war, this huge deficit
represents one of the most urgent
problems facing many nations today.
To facilitate remedial action, the UN
social division suggested that minimum housing standards be fixed and
practical housing programs be established looking toward world-wide
"cheap building" policies.
PROGRESS O F THE V E H P — D E C E M B E R 3 1 , 1 9 4 6
1,003,600 units started account for 84 percent of 1946 goal of 1,200,000
Units
started
Program cc>mponent
Total i
New permanent 2
Conventional 34
Factory-built
5
Temporary re-use
__
6
Conversions
_
7
Trailers
Units
completed
1,003,600
661, 900
670, 900
453, 800
633, 700
37, 200
_
220, 200
64, 500
48, 000
114,800
45, 300
48, 000
1
2
December data preliminary.
Includes factory-built units; breakdown of conventional and factory-built completions not
available.
3
Adjusted to exclude factory-built units; includes approximately 8,000 permanent units
financed
by New York State.
4
Factory shipments.
* Family-equivalent units financed by Federal and non-Federal funds.
6
Estimates, adjusted for lag and attrition.
7
Factory shipments.
Fee/era/ Home Loan Bank Review
A SUMMARY OF MORTGAGE FINANCING
ACTIVITY
The more than $10 billion of mortgages under $20,000 recorded
last year reflected the pace of real estate financing activity. Gl
home loans accounted for somewhat more than one-fourth of the
total. As a result, the total nonfarm home mortgage debt
reached the highest levels on record.
•
AS 1946 records were added up on the country's biggest year in home mortgage finance,
the volume of nonfarm mortgages of $20,000 or
less took its place among the peaks for which
data are available (in this case since 1938). The
total of over $10 billion topped by 85 percent the
previous year's high of $5.6 billion and was more
than double the best prewar year—1941.
Because of the volume of business generated by
high construction and sales levels, the number of
such instruments also showed a substantial gain.
However, the 51-percent rise was not sufficient to
explain the increase in volume. The difference
was in large part the result of higher real estate
prices and the increasing number of high-percentage loans made with GI guaranties. The disparityin rates of gain showed up in the increased average
size of recordings, which rose to $4,206 last year
from $3,440 in 1945 and only $2,769 in 1940.
Although all types of mortgagees participated
in last year's gain, increases were not uniform.
Both mutual savings banks and commercial banks
and trust companies reported a 1946 volume approximately two and one-half times that of 1945
recordings. Life insurance companies (showing
the first increase in five years) and "other mortgagees" reported increases of over 90 percent,
while savings and loan associations showed the
relatively modest gain of 70 percent. Recordings
by individuals increased the least of any type.
Savings and loan associations, with recordings
exceeding $3 billion, continued as the leading type
of mortgagee, although their share of the total—
about a third—was less than in any year since
1943. In 1945 they had accounted for 36 percent,
and the year before for 34 percent of all recordings.
The $2.7 billion volume of mortgages recorded
by banks and trust companies was second to that
of savings and loan associations, representing just
February 1947
729543—47
2
over a quarter of the national total. This was aslightly higher proportion than in 1940, their best
previous year.
Individuals, for the first time since 1942,
dropped to third place as a source of mortgage
credit and although their total volume exceeded
$2 billion, their proportionate participation in the
field amounted to only 19 percent in contrast to a
fourth of the volume the year before. Mutual
savings banks and insurance companies showed
slightly higher shares of the 1946 recording total.
The former are, of course, concentrated largely in
the East, while the participation of life insurance
companies is never fully reflected because of their
reliance on the purchase of mortgages which in
recordings are credited to their originators.
137
Regional data
Mortgage financing activity boomed in all parts
of the country last year. The magnitude of the
increase is illustrated by an examination of the
range of regional gains which in 1946 varied
between 71 percent in the Chicago Bank District
and 115 percent in the Indianapolis region. Last
year the San Francisco and Boston regions almost
doubled their mortgage recording volume with
increases of 98 and 93 percent, respectively, while
the New York and Little Rock areas were also
above the 85-percent national increase. Thus, it
will be seen that there was no geographical
pattern in the expanding activity in 1946.
The increase in the average size of recordings was
nationwide; only four regions (Chicago, Cincinnati,
Pittsburgh and Winston-Salem) advanced less
than 20 percent over 1945. The greatest gain
(29 percent) occurred in the average size of
recordings in the San Francisco Bank District.
The highest average recording last year was
found in the New York region—$4,837—with
three other areas (Boston, Chicago and San
Francisco) also well above $4,000. At the other
end of the scale, the average mortgage recorded in
the Topeka District was valued at $3,221.
Since 1940, the range of increases in the average
size of mortgages recorded was between 37 percent
in the Pittsburgh region and 67 percent in the area
now served by the Federal Home Loan Bank of
San Francisco. In four Bank Districts (Des
Moines, Topeka, San Francisco and WinstonSalem) the average value of mortgages recorded
was more than half again as much in 1946 as it
had been in the prewar year of 1940.
The Gl influence
There are, as yet, no Veterans Administration
data indicating the extent of participation by
various types of lenders in the GI home loan
program. However, the over-all statistics of that
organization show the increasing magnitude of
this operation. The fact that the time limit for
use of the guaranty has been extended to 10 years
means that it will be a factor to be reckoned with
in mortgage finance for some time to come. The
terms, as well as the scope, of the program are
bound to have their influence, too. The 4-percent
interest rate, 25 years maximum maturity, and
appraisal on the basis of "reasonable value" rather
138
Federal Home Loan Bank Review
than "reasonable normal value" have already had
a marked effect on home financing activity.
Cumulative figures through December 1946
showed that in approximately two years almost
$3 billion in home loans had been processed for
closing, with approximately 45 percent of this
principal amount guaranteed by the Government.
Of the total approved, roughly $2.5 billion had
actually been closed—42 percent, or $1.2 billion,
was covered by guaranty or insurance.
It is not possible to state the principal amount of
loans closed during the entire year 1946 since
these data are not available prior to March 30.
In the last nine months of the year, however, the
volume of GI home loans reported closed and
disbursed was equal to over one-fourth of the
volume of all mortgages recorded under $20,000.
The number of GI loans skyrocketed during the
year from 45,000 processed through December
1945 to 523,000 by last year-end. Only recently
has there been any evidence of leveling off in
volume, but of course normal seasonal factors
must be recognized as contributing to this.
Spiraling prices and construction costs have
been no respecters of veterans, with the result
that the average valuation of loans processed has
mounted progressively. From $4,674 at the end
of March, the average has increased until at last
year-end I t was $5,566, a figure $1,360 higher than
the national average of mortgages recorded.
Because of this trend, but chiefly because the
amount of guaranty was doubled by amendment
of the GI Bill, the average guaranteed portion
of these loans rose from $2,027 to $2,599 during
the same period.
I t is interesting to note, as evidence of the good
faith of the veterans, that December 25 figures
showed almost 4,500 loans paid in full for a total
of $18 million, of which $8 million had been the
Government-guaranteed portion. Only 875 loans
had been reported in default, of which 124 resulted in claims totaling $108,000.
FHA activity
Several provisions liberalizing and extending
mortgage insurance coverage were adopted last
year under the VEHP. As home financing activity rose to new heights, a greater demand for
such protection developed, with the result that
FHA activity showed the first increase since 1943.
(Continued on p. 144)
February 1947
39
* * * WORTH REPEATING * * *
PROSPECTS: "I believe that the American people have the wisdom and the
will to use our abundant resources so
that all may prosper. I reject, and
I know the American people reject,
the notion that we must have
another depression. I am not referring to minor detours and bumps
in the road ahead—these we know
we shall have. I am referring to
economic collapse and stagnation
such as started in 1929. This need
not happen again, and must not
happen again."
• The Economic Report of the President,
transmitted to the Congress, Jan. 8,
1947.
OPPORTUNITY: "The best opportunity in 1947 will be open to those
concerns and industries that are able
to give better value of product or
service for the price they receive.
This applies to our savings and loan
business as it does to all others.
Our job is to help people obtain
homes they can afford to live in.
The association that can help materially in selling this great public
need should have no fear of the readjustment of 1947."
Raymond P. Harold, President,
Worcester Federal Savings and
Loan Association, The National
Savings and Loan Journal, December 1946.
PREDICTIONS; "The buyer's strike
which has caused the leveling off of
the used house market during the past
six months will begin to operate in
the new house field early in 1948.
In spite of the comparatively small
number of new dwelling units built
since VJ Day, we are rapidly exhausting the back-log of 'able-to-buy'
prospects in the price ranges in which
we are now building. This is true
even though the shortage of housing
is more acute now than it was at the
beginning of 1946."
James C. Downs, Jr., Real
Estate Research Corporation,
Savings and Loans News, December 1946.
THRIFT TODAY: " . . Thrift education, in its modern sense, is no longer
of concern only to thrift institutions.
As a result of the deficit financing
140
made necessary by the depression
and the war emergency that followed,
it has now become a matter of vital
concern to our national economy."
Robert L. Knight, The Howard Savings Institution, Newark, N. J.,
Savings Bank Journal, January 1947.
SERVICE: "We are now meeting the
challenge of making our institutions
large enough and efficient enough to
serve the public with a variety of
activities related to home financing
and to do things as a part of our
service which 20 years ago would
have been charged for on the dotted
line and done grudgingly at that.
The Avhole concept of what a savings
and loan institution - means by its
existence has been broadened to the
place where this city for the first
time in a great home building era is
equipped with a financial system
geared to the job and primarily interested in doing that particular job
of lending, safely and soundly."
Ben F. Bohac, President, Talman Federal Savings and Loan
Association, Chicago, 111., Realty
and Building (Annual Review)
Jan. 25, J947.
VETERANS' NEED: "A building boom
based on a scramble to produce
only high priced housing would
invite disaster. The production of
medium and low-cost homes will
produce a stable and continuing
housing prosperity and will meet our
veterans' need . . . We'know that
within the industry there is a sharp
awareness both of the need and the
obligation to meet the need. There
is also an unchanged determination
by the Government to exert every
effort toward practical solution of the
housing emergency."
Statement on the Housing Program for 1947 by Frank R. Creedon, Housing Expediter, and
Raymond M. Foley, NHA
Administrator, Jan. 26, 1947,
PARADOX: "The current situation
in real estate mortgage lending presents a strange paradox, to wit, rates
down—risks up. Yes, it is characterized by low rates of interest, long
periods of amortization, and thin
equities occasioned by abnormally
high values, all of which present a
real hazard. It is frequently desirable and necessary in mortgage lending to sacrifice something in the way
of performance when there is a substantial equity, or to loan somewhat
more liberally in relation to appraised
value when the indicated performance is good. To combine mediocre
performance with a thin equity is a
poor lending practice at any time,
however; and in periods such as this
it is nothing less than criminal."
Maple T. Harl, Chairman,
FDIC, before convention of
Savings Banks Association of
New York, Quebec, Canada.
TURN?: "Has the turn come? Or is
this merely a temporary adjustment
in a broad movement, the end of
which is nowhere in sight? Whatever the answer, there has been a
change. Higher-priced housing almost everywhere is being marked
down but that doesn't mean it's
cheap or represents anything like
'normal' value. And demand certainly has let up some, more in some
areas than others, which in some
respects is surprising because the
shortage of housing seems to be just
about as acute now as it ever was."
The Mortgage Banker, February 1947.
THE BOOKSHELF
Although inclusion of title does not
necessarily mean recommendation by
the REVIEW, the following recent publications will be of interest.
BUILD A HOME: By Paul Corey.
234 pp. $2.50. The Dial Press,
Inc., 432 Fourth Avenue, New York,
N. Y.
VETERANS
HOUSING
REFERRAL CENTERS:
V E H P Community Action Bulletin 6, September
1946. National Housing Agency,
Washington 25, D. C.
SUBDIVISION
CONTROL
AND
VETERANS
HOUSING:
VEHP
Community Action Bulletin 7, November 1946. N a t i o n a l H o u s i n g
Agency, Washington 25, D. C.
HOW TO BUY OR LEASE
SURPLUS REAL ESTATE: Office of
Real Property Disposal, War Assets
A d m i n i s t r a t i o n , Washington 25,
D. C.
Federal Home Loan Bank Review
HOME CONSTRUCTION AT RECORD LEVEL
More new privately financed homes and apartments were started
last year than in any year since 1928/ and real progress was made
in the production of building materials. The sharp increases in
construction costs in 1946 cast a shadow over the future outlook.
at. Never in our most lush industrial period
had we built anywhere near that many accommodations. The materials and labor necessary to
do the job were staggering, and complications
were compounded since, in order to meet the
needs of the majority of veterans, these houses
would have to be kept within a moderate price
range despite the tremendous inflationary pressures rampant in the country.
The fundamental answer to all these problems
was, of course, production—and more production
of building materials. Until it could be achieved
in sufficient volume, the most strategic use of
existing supplies had to be of equal importance.
At the turn of the year, after a trial of normal
peacetime operation in the construction field had
proved inadequate to the emergency, priority
controls were re-instituted to break bottlenecks in
materials production and to assure allocation of
the bulk of all critical supplies to homes for which
veterans were to be given preference. H H
priorities became the backbone of 1946 residential
construction. Under this system, supplies were
channeled into the construction of houses costing
•
AT the beginning of last year, as the stream
of returning veterans reached flood-tide, it
was a toss-up whether "welcome home" banners
or "no vacancy" signs were in the majority.
The plight of the homeless veteran and his family
focused the national spotlight on housing with an
effectiveness which could be matched in no other
way. It was difficult to persuade the average
citizen that this situation did not "happen overnight," but was the result of more than a decade
of deficiencies in home construction combined
with an economic condition of full employment
and high consumer incomes which brought about
the crisis in housing.
To cure such a long-standing ill on a shortterm basis was humanly impossible. So, putting
first things first, the Veterans Emergency Housing
Program was set up during 1946 to concentrate
on meeting the needs of these returned servicemen.
Program target
The Program target of starting 1.2 million
dwelling units in 1946, although modest enough
in terms of need, was really something to shoot
NONFARM
HOME CONSTRUCTION
OVER
TWO
WAR
PERIODS
1,000
1,000
800
800
600
600
400
400
200
200
1916
17
18
19
'20
SOURCE.- Buraau of Labor Statistics
'21
'22
'23
'24
'25
'26
"27
'28
'29
'30
'31
'32 '33 '34 '35 '36 '37
'38. '39
(Estimatsd starts)
FEDERAL
February 1947
'40
'41
'42
'43 '44 '45 '46
OPERATING ANALYSIS DIVISION
SAVINGS AND LOAN INSURANCE CORPORATION
141
$10,000 or less or renting at an $80-monthly
maximum. A conscious effort was made to keep at
least half of all priority-built houses priced below
the average for houses built in the preceding year.
A tightening of general construction standards
was also provided under this system, requiring
conformance to minimum space, arrangement and
building standards. Although difficult to enforce
and cumbersome in application, these H H standards—coupled with sales and rental price maximums and compliance inspections—were designed
to protect the interest of the veteran-occupant.
Early in 1946 a new version of the wartime
"Stop-Construction" Order was issued to divert
the major share of building materials to the V E H P .
This Order prohibited, with certain exceptions,
any construction or repair work not definitely
under way before March 26, unless it carried
specific Government authorization. Also, to relieve essential residential building of needless competition from other sources, the Government
deferred its own non-essential construction projects
and tightened standards of necessity for commercial and industrial building in order to speed
the veterans program.
Attacking the problem on a "grass roots" basis,
Mayors' Emergency Housing Committees were
sponsored in over 700 communities.
These
groups, by coordinating the efforts of local
builders, labor organizations, supply dealers and
financing institutions, achieved substantial results
throughout the country.
and draft deferment policies were revised to keep
current workers on the job. Several of the trade
unions entered into no-strike pledges in order to
insure uninterrupted construction of homes for
veterans.
Production of building materials rose at unprecedented rates last year. Although the chart
on this page does not reflect the progress of all
essential materials, it is indicative of the generally
improved situation. A number of vital construction components were substantially in balance by
the end of the year, and the prospects for others
during 1947 were good.
Results of the Program
By these and many related measures, the combined efforts of private enterprise and Government resulted in a million dwelling units being put
under construction during 1946. Over 670,000 of
these represented new permanent additions to
our housing stock, with more new privately
financed homes and apartments being started
than in any year since 1928.
The category of "new permanent units," as
estimated by the Bureau of Labor Statistics, inPRODUCTION OF SELECTED BUILDING MATERIALS
SINCE VJ-DAY
INDEX {AVERAGE MONTH 1939 • 100)
220
Materials production
In order to give allocation and construction
controls more than an academic meaning, it was
necessary to expand the building potential of the
country. By means of premium payment plans it
was possible to bring into production many plants
that had proved uneconomic in peacetime operation. Guaranteed market contracts, designed to
supplement the ordinary supply by encouraging
the production of new materials and prefabricated
houses, brought expanded production by assuring
Government purchase up to 90 percent of all
products that could not be sold on the open
market. Specific price and wage increases were
also obtained to overcome bottlenecks.
An expanded apprentice training program was
undertaken to build up a supply of skilled labor,
142
40 I
II I I I I 1 I I I I I I I I I I I I
40 L
1941
ASONDJFMAMJJASOND
MO. AV.
| 9 4 5
| 9 4 6
1941
MO.AV.
ASONDJFMAMJJASOND
| 9 4 5
|94g
1i
220
CAS T
IRON
SOIL PIPE
100 mm
40
1941
MO.AV.
ASONDJFMAMJJASOND
| 9 4 5
| 9 4 g
NOTE:-Not adjusted for seasonal variation
SOURCE- Dipt of Comirnrct
FEDERAL
\T\
1941
MO.AV.
I I
\ y
ASONDJFMAMJJASOND
| Q 4 5
| 9 4 g
OPERATING ANALYSIS DIVISION
SAVINGS AND LOAN INSURANCE
CORPORATION
Federal Home Loan Bank Review
VETERANS EMERGENCY HOUSING PROGRAM
1946
Units under way at the beginning of 1946
Started during 1946
Completed during 1946
Under way at the end of 1946
r t D I R A L ( A V I M S AND LOAN INtUHANOI OOftPONATION
eludes both conventional (94 percent of the total)
and factory-built houses. Although output of the
latter was not so great as had been hoped for, they
showed an almost steady month-to-month production gain.
The conversion program sponsored under the
V E H P as a quick and relatively cheap way of providing housing, accounted for 65,000 units.
Another time- and material-saving device was the
temporary re-use of old war housing facilities.
By this means, 220,000 family-equivalent units
were put under construction, including many
veterans' housing projects undertaken by educational institutions and local government groups.
Also, about 48,000 trailers were provided as temporary emergency accommodations.
A total of approximately 662,000 units reached
the "key in the door" stage by the end of 1946,
with new permanent dwellings making up the
greater part—69 percent. While it is recognized
that nobody can live in a " s t a r t / ' without them
there could be no completions and a year-end
date is an arbitrary limit to set in measuring
accomplishment over a period of time. The encouraging thing about the month-to-month record
of completions was the progressive rate of increase. The early part of this year should begin
to reflect added acceleration brought about by
the increasing flow and balance of essential
materials. Projects, which for the lack of one
or two items, have remained in the " starts"
column should rapidly appear as completed units.
Comparative data
It is admittedly difficult to make comparisons
between the 1946 construction record and those of
preceding years due to necessary differences in
February 1947
various statistical series. Last year, because of
the magnitude and immediacy of the crisis, the
problem was attacked from every angle with the
result that many emergency units were counted
which would not normally be included in housing
statistics. The most nearly valid measure of
comparison is the regular Bureau of Labor Statistics series of privately financed nonfarm construction, based on the number of building
permits issued.
For 1946, BLS reported a total of approximately
677,000 permits for privately financed nonfarm
construction—almost three times the number
issued in 1945 and 9 percent above the prewar
1941 total. Activity last year got off to a good
start, with permits considerably in excess of the
best 1945 month, building up rapidly to a peak
in March. This was done to get underway houses
in the over $10,000 class whose construction would
have been prohibited after March 26. Although
monthly permit figures fluctuated generally downward during the rest of the year, even in December
which usually brings a seasonal decline and lastyear was complicated by the coal strike, over
35,000 permits were issued, 21 percent more than
in the same month of 1945 before the Program
got underway.
Single-family units dominated the field last
year to an even greater extent than they had
previously. Permits were issued for almost
605,000 houses, or 89 percent of all private construction. In 1945 only 203,000 such permits
were granted, accounting for 88 percent of total
privately financed construction, and in 1941,
533,000 one-family dwellings constituted but 86
percent of the total. The relatively low level of
multi-family units last year (only 7 percent of
total private construction) which are primarily
for rental purposes, brought a shift in emphasis
in the 1947 housing program, inasmuch as so
many veterans have expressed themselves as
being in the market as renters rather than home
owners under present conditions.
Construction cost trends
The effects of mounting construction costs were
reflected in the fact that again building permit valuations of all privately financed nonfarm residential construction showed a greater proportionate
increase than did the number of permits issued.
143
The total, which was just over $3.0 billion, was
three and a half times the amount recorded in
1945 and 36 percent greater than the 1941 volume.
This raised the average permit valuation for these
structures to $4,388. In 1945 it had been $3,701
and in 1941, it was $3,520.
The story behind the rising permit valuations
is partially told in the index of the cost of building
a standard six-room frame house. From December 1945, when it stood at 139 (on a basis of 19351939=100), it rose each month until it reached
161—a gain of 15 percent in the 12-month period.
The greater part of this increase was in the materials component which rose 18 percent. During
December alone, the first full month of price
decontrol, materials rose over 3 percent compared
with a 1-percent gain for labor costs.
Wholesale prices provide a more sensitive
,measure of change since they are immediate reflectors while the building cost index tends to lag
behind and shows variations only as they reach
the retail level. For that reason, the BLS index
of wholesale building materials prices may provide
a clue to future cost trends. Price adjustments
during the first 10 months of the year produced a
steady advance but with the elimination of ceilings in November, the index bounded up 12 points
during that month and 14 points in December.
The gain in these two months was equal to that
recorded during the preceding two and one-half
years. Part of this gain may be attributed to a
recognition of black market prices which had prevailed during the period of price controls. Steady
increases in production during the comparatively
inactive building months of mid-winter may tend
to ease some of the pressure on prices between
now and the resumption of home building in the
spring construction season.
The new program
With the removal of all price ceilings and the
broader effects of relaxing wartime controls, it
was necessary to reconstitute the housing program
at the close of last year. A simplified system of
building authorizations was inaugurated under
which both veterans and non-veterans could build
homes for their own use. All priorities on construction were eliminated, limitations on size
replaced price ceilings, and primary emphasis was
shifted to rental properties.
144
Mortgage Financing
(Continued from p. 139)
A total of $798 million in premium paying loans
was made in 1946, up $115 million from the previous year.
Title I I home loans increased substantially and
totaled about 67,000 to amount to $347 million
with expanded construction activity showing up
in a decided shift to loans on new properties.
Conversely J Title VI activity, on 1- to 4-family
homes, dropped about 70 percent in both number
and amount with only 14,000 such loans insured
totaling $75 million.
Conversion activities incident to the housing
program helped to bring another large increase
in the volume of loans for modernization and repair insured under Title I. Insurance covering
799,000 such projects was provided, with an aggregate principal of $362,743,000.
Other measures of activity
Although it is too early to cite any firm 1946
year-end figures on the size of the home mortgage
debt, there is no doubt that it rose last year to an
all-time high. This assumption is predicated
chiefly on the hitherto-unmatched total of mortgage lending which more than offset the effect
of continued high rates of repayments. An estimated increase of 15 percent to $23 billion does
not seem out of line with real estate conditions.
Annual figures on nonfarm real estate foreclosures are also still in the stage of prediction.
The first nine months of last year brought only
8,600 actions, with the second- and third-quarter
rates lower than any others on record. The
annual rate per 1,000 structures for the 12 months
ending in September 1946 was 0.5 percent compared with 0.7 for the full year of 1945. In view
of these facts, it seems probable that even the
addition of the last three months' figures would
not raise the 1946 total to the 14,000 reported
in 1945.
In the absence of over-all figures on the value
of real estate owned by financial institutions, the
record for all insured savings and loan associations
provides an indication of the continued downward
trend. During 1946 that account in these institutions was cut in half, and at year-end totaled
only $6.6 million, or less than one-tenth of 1
percent of total assets.
Federal Home Loan Bank Review
THE PATTERN OF NEW SAVINGS
The net new savings accumulated by individuals last year were at
the lowest levels since 1 9 4 1 , as increased spending opportunities
and higher living costs cut into personal incomes. In spite of this,
the savings account balances in institutional media showed
substantial dollar gains over 1945.
•
ALTHOUGH the total amount of savings
held by individuals reached another new high
during 1946, the aggregate volume of net additions
to the various types of savings media during
the year was the smallest since 1941. The
reduced amount of new savings occurred in spite
of the fact that income payments to individuals
were even higher than during the peak war years.
People had less to save because they were able to
buy more and had to pay more for what they
bought. Substantial progress was made during
the year toward full peacetime production, thus
permitting consumer goods to flow in everincreasing quantities into normal distributive
channels. However, a huge pent-up demand in
relation to available supplies exerted insistent
pressure toward higher price levels. This rise,
retarded by price control early in the year, was
accelerated by the subsequent lifting of controls
in November.
Contrary to expectations early in the year,
income payments to individuals climbed to $164
billion in 1946 to top the previous year's $161
billion, the Department of Commerce estimated. 1
After payment of taxes, the amount of money
left in consumers' hands last year was $144.5
billion compared with $139.6 billion in 1945.
However, the American people saw the major share
of this spendable income—87.9 percent—slip
through their hands to buy consumer goods and
services as expenditures for these purposes rose
to a record $127 billion. This was almost a fifth
more than they spent in 1945 and over two-thirds
more than in 1941. Because of the huge expansion
of consumer spending, the amount available for
saving by individuals dropped to $17.5 billion in
1946 against $33.1 billion the year before.
Only about one-eighth of the money received by
individuals (after taxes were paid) was available
for saving compared to approximately one-fourth
during the war years 1942-1945. In light of the
strong competition for the consumer's dollars in the
past 12 months, it is significant that the amount
available for personal savings in 1946 was still
greater than for any year before 1942.
Savings in institutional media
In general, the concept of savings inherent in the
above calculations is based on an economic definition and therefore includes such factors as fluctuations in consumer instalment debt, home mortgage
debt and other related items. To bring the
current discussion of savings closer to the operations of thrift institutions, the question may be
raised as to what happened in individual savings
media such as share accounts in savings and loan
associations, time deposits in commercial banks,
accounts in mutual savings banks, postal savings
accounts, U. S. savings bonds and life insurance.
With the single exception of the outstanding value
1
The data for measuring income payments to individuals attempt to
measure the flow of money into the hands of individual consumers. They
form a part of the calculation of national income data and the determination
of so-called gross national product. It is purely coincidental that both net
national income and income payments to individuals last year were estimated
at $164 billion. In 1944, for example, the figures for the same series were
$160.7 billion and $156.8 billion, respectively.
February 1947
145
of Series E savings bonds, the amount of money
held in these various media in 1946 increased
during the year, although in a majority of cases,
both the percentage and the dollar gains were less
than in the preceding year.
Net new investments in all operating savings and
loan associations in 1946 were estimated at $1.1
billion, bringing their total savings accounts to
$8.5 billion. Slightly above the $1 billion added
in 1945, the dollar gain was more than in any year
to date. Percentagewise, however, the 1946 increment was only 15 percent against 17 percent the
previous year. By last year-end, total time
deposits in all commercial banks were estimated
by the Federal Reserve Board at $33.7 billion.
Although no breakdown on ownership is available,
it is assumed that most of these funds are held by
individuals. Despite a net gain of $3.6 billion in
this form of savings during 1946, the rate of growth
had declined to 12 percent compared to 25 percent
for the preceding 12 months.
Deposits in mutual savings banks increased
$1.5 billion during 1946 and on December 31
stood at $16.8 billion. In dollar amount, the
expansion of these accounts last year was somewhat less than the $2 billion added in 1945 and the
percent of increase followed the downward trend
evident in other savings media—dropping from
15 percent in 1945 to 10 percent last year. The
estimated year-end balance of postal savings accounts was $3.3 billion—an increase of $400
million compared with a $591-million gain in 1945.
Again, on a percentage basis, the 1946 gain was
only about half that recorded the previous year.
Savings bonds
Spurred by promotional campaigns in J u n e July and November-December, sales of E, F and
G bonds totaled almost $7.5 billion in 1946, the
Treasury Department reported. Although more
than 40 percent below the 1945 figure of $13 billion, last year's sales almost doubled predictions
made early in 1946. Over 60 percent of total
sales, or $4,465,000,000, represented " E " bonds.
Purchases of "F" bonds amounted to $324,641,000
and " G " bonds added $2,636,866,000 more. No
"goal" was set for sales in the first two postwar
campaigns sponsored by the Treasury; nevertheless they not only stimulated sales but appreciably
reduced the volume of redemptions.
146
Aggregate redemptions of all three series reached
$6,037,977,000, resulting in a net addition ol
$1,389,216,000 to E, F and G bonds outstanding
at the end of last year. Sales exceeded cash-ins
for both the F and G series but " E " - b o n d redemptions topped their sales by almost $1 billion.
Since the net shrinkage in the outstanding value
of this series amounted to only 1.1 percent during
the past 12 months, the balance of $30.2 billion
held on December 31 surpassed the most sanguine
forecast of a year ago.
The volume of " E " bond redemptions has been
dropping in recent months, despite smaller incomes, rapidly rising prices and an increasing flow
of consumer goods. In an analysis of this trend,
the Federal Reserve Bank of Cleveland found the
cash-in rate for " E " bonds is apparently more
sensitive to fluctuations of wage and salary payments than to the other two factors. According
to this study, continuously employed families have
generally been able to meet rising living costs
from current income and thus hang onto their
bonds, while families whose incomes were cut
sharply by strikes or lay-offs have had to cash their
bonds. In passing, it is interesting to note that
wages and salaries were the only major segments
of national income that failed to show increases
over their 1945 level.
This study included an analysis of redemptions
of " E " bonds on the basis of the year in which
they were originally issued. Of the " E " bonds
issued in 1942, only 30 percent had been redeemed
by December 1 of last year; of those issued in 1943
and 1944, 36 percent had been cashed. Cash-ins
for those issued in 1945 and 1946 were 30 and 13
percent, respectively, as of the same date. In
all, about one-third of the more than $45 billion
(cost price) of " E " bonds sold since they were
first offered in May 1941 had been turned in.
According to the study, this is regarded as a
favorable redemption rate especially "when it is
realized that savings bonds were sold to millions
of people unaccustomed to saving.' 7
Life insurance
Sometimes overlooked in the savings of individuals are funds accumulated in life insurance
policies. An estimated $3 billion was added last
year to the total of $37.4 billion in this type of
savings on policies in force at the end of 1945.
Federal Home Loan Bank Review
The total of these funds, as shown in the FHLBA
series, aggregated $40.4 billion by the end of
December 1946—a percentage increase about
equal to that in 1945.
By the end of 1946, some 73 million Americans
owned $174 billion in non-Governmental life
insurance, according to the Institute of Life Insurance. In one of its greatest years of expansion
in a 100-year history, life insurance in force jumped
nearly 12 percent over 1945 and almost 40 percent
above 1941.
About $23.5 billion in new life insurance was
bought during 1946, an amount unsurpassed in
any previous year. This volume of purchases was
47 percent above the 1945 total and also topped
by 30 percent the former peak of $17.9 billion in
1929. By last December 31, the average coverage of each policyholder had risen to $2,375.
In sharp contrast to the growth of private life
insurance during the year, ownership of National
Service Life Insurance dropped off sharply.
Despite a vigorous campaign throughout the year
to persuade veterans to retain or revive their
service insurance, many allowed it to lapse on
their return to civilian life. Out of the approximately 19 million policies worth about $149
billion applied for since the Government first
organized such insurance for World War I I
service personnel, the Veterans Administration
estimated only about 5.6 million policies with a
face value of $34.2 billion remained in force on
December 31. Only $2.8 billion of this was converted insurance on a permanent basis under
632,000 policies and the balance was term insurance as originally issued. Slightly more than
two-thirds of the converted policies were 20payment life contracts.
preceding year, 19 percent of the individuals interviewed expected to save less in 1946, while 26
percent either didn't know or wouldn't say.
About one-third thought they would save as much
and only 21 percent believed they would save
more than in 1945. The facts have borne out
the less optimistic expectations.
Liquid assets owned by the majority of the
population cannot be considered a sufficient reserve to sustain regular expenditures very long
in case there should be drastic reductions in their
income. Of the $130 billion in total savings accumulated by the end of 1945, over half was held
by just 10 percent of the population. Over onefourth of the people had no liquid assets while
another quarter owned only .3 percent of the total.
Although the majority of persons questioned had
no checking or savings accounts, two out of every
three did own some U. S. savings' bonds. However, the total asset holdings of three-fourths of
the people amounted to less than one-fifth of their
annual income.
i A DIRECTORY ||g||l
^ P > CHANGES ^ J P
December 1946
Key to changes
*Admission to membership in Bank System
**Termination of membership in Bank System
#Federal Charter granted
##Federal Charter canceled
001nsurance Certificate canceled
N E W YORK DISTRICT
N E W YORK:
Maspeth:
#Maspeth Federal Savings and Loan Association, 56-18 69th St.
Federal Reserve Board study of savings
An important contribution to general knowledge
about the characteristics and habits of people who
save was made during the year by the Federal
Reserve Board's National Survey of Liquid Assets.1
Conducted by the Division of Program Surveys of
the Department of Agriculture for the Federal Reserve Board, this study forecast the decline in the
total income available for individual savings in
1946. In predicting their 1946 potential savings
compared to what they had actually saved in the
i See FHLB REVIEW, July, August and September 1946.
February
1947
P I T T S B U R G H DISTRICT
PENNSYLVANIA:
Cornwells Heights:
** Corn wells Building and Loan Association.
Philadelphia:
*#Eastern Federal Savings and Loan Association, 2316* Orthodox St.
CINCINNATI DISTRICT
OHIO:
Cincinnati:
•Lincoln Building Association No. 1, 2969 River Rd.
*New Mohawk Building Association, 413 West McMicken Ave.
L I T T L E ROCK DISTRICT
TEXAS:
Dallas:
**##00Guardian Federal Savings and Loan Association, 1204 Main St.
*Guardian Savings and Loan Association, 1204 Main St.
147
BACKGROUND OF BUSINESS CONDITIONS
The past year saw many new peacetime records set in various
phases of our economic life. National income reached higher
levels than during any war year, and "full employment" became
a reality for the first time. Prospects for 1947 are encouraging
although there are several unresolved problems in the path.
•
C O N V E R T I N G the economic machinery
of the country from wartime to peacetime operations did not prove to be a quick nor
an easy job. Progress throughout 1946 was on a
"stop and go" basis. Early last year, the first
adjustments had been made and industrial production appeared ready to go into high gear.
However, "stop signs" began to show up with
c o n s i d e r a b l e f r e q u e n c y . Materials shortages
hampered production. Strikes in primary industries began to increase, with steel, automobile,
coal and railroad work stoppages making for
very jerky progress. As these tangles were being
unsnarled, a different form of slow-down resulted
from the uncertainties about price control. Then,
as the year drew to a close and production was
gaining a new postwar momentum, the second
coal strike for a time repeated the threat of complete industrial paralysis.
Despite these reconversion difficulties, however,
total production mounted to new peacetime
records. The effects of war contract terminations
by February of last year had brought the Federal
Reserve Board index to the lowest point since
early 1941. From 152 percent of the 1935-1939
average, in that month, the index see-sawed up to
179 at the end of the year, with non-durable
goods accounting for more than their normal
peacetime share of this activity.
The year also brought full employment. Even
as military discharges mounted, throughout the
first half of 1946, civilian employment continued
to rise to an all-time high of 58 million in July.
Since then it has declined to the neighborhood
of 57 million but at no time have there been more
than about 2.2 million people unemployed—a
figure which has come to be accepted as the practical minimum normal in a fluid economy such as
ours.
The high levels of production and employment
were reflected in a national income of unprecedented volume. The estimated total of $164
148
billion was $3 billion more than in 1945 and almost
70 percent greater than the 1941 amount. However, the components showed considerably different trends. While net corporate profits after
taxes were increasing by one-third, net income of
proprietors showed a 17-percent gain and compensation of employees declined 5 percent. The
decrease in total employee incomes resulted from
cutbacks in military and Federal civilian personnel
which more than offset the 7-percent gain in
private industry payrolls. Although wage rates
increased, the reduction in the average work week
for manufacturing industries brought an actual
decline in the take-home pay of many wage earners.
This, in addition to the rising cost of living, directly
influenced the reduced rate of savings discussed
on page 145.
As the nation returned to a peacetime economy
the expenditures of consumers and private business once more took the lead over the Government
which had recently been the number-one customer.
The Federal outlay last year was reduced more
than half, to $35 billion from the $84 billion spent
in 1945. At the same time, business found it
Federal Home Loan Bank Review
necessary and increasingly possible to rehabilitate
and expand facilities and stocks. Expenditures
for producer durable equipment reached nearly
$13 billion, almost double the 1945 amount.
Business inventories showed the largest increase
on record, rising over $9 billion from the end of
1945. Normally an increase of this size would
cause considerable concern, but last year it was
a matter of filling empty pipe lines. Inventories
in various stages of production were still unbalanced and inventories of finished goods remained
low in relation to sales. The fact that the rate of
accumulations was slowing down at the year-end
was an encouraging sign.
Prices
One of the major difficulties encountered on the
road to reconversion was the general price situation. Price controls continued to act as regulators
during the early part of the year, with gradual,
moderate increases granted to speed production
or offset higher wages. As the expiration date of
the Price Control Act approached, complications
began to pile up. Goods were held back from the
market in anticipation of higher prices, and these
were not long in coming.
The temporary period of decontrol between
June 30 and July 25 proved to be only a plateau
above which prices continued to rise during the
period when the modified system of selective
controls operated. Early in November all price
ceilings except those on rents, rice and sugar
were abandoned.
As a result, the over-all rise in prices during 1946
was greater than in any year since World War I.
Between June and the year-end, wholesale prices
rose 25 percent, following a rise of 5 percent in
the first half of the year, and the cost of living
increased almost 15 percent as against 3 percent in
the two comparable periods.
This, obviously, had serious repercussions on
the purchasing power of the dollar. On the basis
of the 1935-1939 average dollar being worth 100^,
the December 1945 index of wholesale prices
stood at 75. By June it was down to 71 percent
and the December 1946 figure was only 60. The
same 6-month measures of consumer prices, which
always lag behind wholesale prices, showed
the 1935-1939 dollar worth 77^, 75^ and 67f£,
respectively.
February 1947
Financial developments
One of the outstanding financial developments
of the year was, of course, the reduction in
Government debt. From an all-time high of $279
billion at the end of February, it dropped to
$262 billion at the close of last year. This debt
retirement has been almost entirely in securities
of the type held by commercial banks and Federal
Reserve Banks. This is in line with the antiinflationary policy pursued by the Treasury to
keep war financing as much as possible in nonbanking sources.
The firming of selected interest rates has been
another significant financial feature of the past
year. The average yield on long-term Government
bonds, which was 2.33 percent at the close of 1945,
dropped to an all-time low of 2.08 percent in April
but followed a zig-zag course upward during the
remainder of the year and closed slightly below the
previous year-end level. Yields on corporate
bonds showed a rather similar pattern. Another
evidence of this general trend of the firming of
interest rates is the fact that New York financial
papers have recently reported that as commercial
149
loans have matured, they have been renewed at
somewhat higher interest rates than in the near
past. There has been no indication of any change
in the level of mortgage lending interest rates,
however.
The break which occurred in stock prices last
year marked the end of a four-year bull market.
Quotations moved generally higher to reach a
16-year peak in May. The decline was gradual
until the sharp break after Labor Day. At the end
of December, stock indexes were only slightly
above the year's low.
The amount of money in circulation increased
again last year but at a considerably slower rate
than during the war. After showing a month-tomonth decline early in the year, it again turned
upward and at the end of the year amounted to
just over $29 billion. Although this was an
all-time high, the net gain between year-ends was
only $400 million compared with increases of $3-5
billion in the preceding three years.
Expanding commercial and consumer credit
also featured last year's financial developments.
Increased needs for funds on the part of both
business and individuals, coupled with the removal
of many wartime credit restrictions, brought this
reversal of recent trends. Commercial, consumer
and agricultural loans, which at the end of 1945
had totaled $7 billion, rose to $10 billion at the end
of the year; while consumer credit increased from
$6.7 billion to $9.8 billion during the same period.
Of this latter amount, instalment credit showed
a gain from $2.4 billion to $4 billion.
The *47 Forecast
B
T H E business of making economic forecasts
becomes more hazardous with the approach
of each new year. As the number of "unpredictables" increases, it is obvious that even these socalled "educated guesses" foretell of future trends
with diminishing accuracy. Yet, the consensus
of management holds that even a poor estimate
intelligently acted upon is likely to produce a greater
measure of success than depending solely on the
belief that next year will in all likelihood not be
too different from this year which was not too
different from last year, etc. . .
A few weeks ago, the executive officer of a large
eastern association was discussing the subject of
forward planning with a savings and loan group and
his thoughts clearly reflected the necessity for
such action. "You know," he said, "this business
of thrift and home financing gets more complicated
every year. I t used to be that changes were made
gradually; one year was just about like the next
one; and except for the worst depression years our
business would just about run itself. Today it's
an entirely different story. Even before the end
of one year, our Board is already at work formu150
lating and revising operating policies for the next
12-18 months. Every year now it's just like
starting all over because of the new angles which
are continually cropping up.
"Just look at the contrast between 1945 arid
1946," he went on. "Two years ago we were concerned about too much money and no lending
opportunities. Last year, almost over night the
situation changed so drastically that we began to
wonder if those surplus funds we'd been accumulating would be enough to satisfy the demand for
good sound loans coming our way. For the first
time since 1942, we began to really work at this
idea of selling the public on putting their savings
in our institution.
"This is the period when an association which
doesn't plan ahead and anticipate to the best of its
ability, through the combined efforts of its managing officer and directors, can without half trying lay
the foundation for real trouble in the years ahead."
The general economic outlook
As one cog in the American business machine,
the thrift and home financing industry will be
Federal Home Loan Bank Review
greatly influenced by the tempo at which the
entire economy moves. For this reason, it is well
first to survey the general prospects for the coming
year. In the Economic Report of the President
submitted to Congress early in January, it was
emphasized that on the plus side of the economic
ledger "our industrial plant is larger and, in many
cases, better than ever before. Funds for business expansion are ample and profit incentives are
high in most lines. Our labor force has greatly
increased its number of semi-skilled and skilled
workers. The spending power of consumers, as a
whole, is much higher than it ever was before the
war. Consumer desires are fortified by a backlog
of unsatisfied wants, particularly for housing, commercial construction, automobiles, household appliances, furnishings and other durable goods.
There are long-deferred and needed public works—
Federal, State, and local. There is a strong and
sustained foreign demand/'
The report, however, also called attention to a
number of unfavorable factors which must be
considered in analyzing 1947 trends. Chief
among these is the marked decline in real purchasing power of great numbers of consumers, resulting
from the large price increases in the second half of
1946. Maximum production and employment
this year would yield a substantial increase in
the supply of consumer goods, especially of the
durable variety, and it will require higher real
purchasing power to take the goods off the market.
If price and wage adjustments are not made,
the Report goes on—and made soon enough—there
is danger that consumer buying will falter, orders
to manufacturers will decline, production will drop
and unemployment will grow—unless consumers
resort to large additional borrowing and use of
past savings to buy the increased supply of goods.
These temporary expedients are limited in power,
and, even if available, would merely postpone the
day of reckoning.
A second and important contingency in the 1947
outlook is the condition of labor-management
relations. At the present moment, the business
economy is as free from strikes as it has been at
any point since the end of the war. A resumption
of widespread work stoppages would directly
interfere with production and employment by
creating or intensifying shortages of materials,
parts or equipment. Further, they would add to
Fzbruary 1947
uncertainties about demand or supply and the
costs of materials, which in turn might lead to
reductions in business outlays for plant, equipment
and inventories.
The Report concludes that the underlying favorable factors are strong enough to maintain high
prosperity. The maladjustments and unfavorable
possibilities, not corrected or prevented, could
cause a recession in production and employment.
Construction's biggest year ahead
In all likelihood, the volume of construction
expenditures during 1947 will be the greatest for
any peacetime year on record. I t will be close to
the all-time peak established in 1942 under the
influence of war plants, etc. The Department of
Commerce has stated that the outlook is favorable
for the construction of $15 billion in new buildings,
plus $6.5 to $7 billion to be spent in repair and
maintenance. For new construction this is a
50-percent increase above the 1946 volume of just
over $10 billion.
Continued gains in home building will account
for the major share of the 1947 increase. The
Commerce Department predicts that $6 billion
will be spent on private nonfarm residential construction. This should permit the starting of
approximately 1,000,000 private permanent dwelling units and the completion of 900,000. In 1946,
about 675,000 privately financed permanent units
were started and 450,000 completed. These
estimates are substantially agreed to by the
Bureau of Labor Statistics which also expects
about a million new permanent dwelling units to
be started, and 950,000 completed in 1947. It
adds that one-fifth of the dwellings started will
be in multi-family structures, which are usually
built to rent.
In a round-up of business economists and
building leaders, the Architectural Forum in its
annual "Building Forecast" is slightly more conservative in its estimates of private nonfarm
residential construction ($5.1 billion) and total
construction ($20.2 billion). However, it concludes that about 1,200,000 dwelling units will be
started with the private funds and an additional
$230 million of public funds.
All these predictions are hedged with careful
reservations of conditions which will after all be
the real determinants of the volume of construc151
tion. Commerce Department estimates, for example, are based on the assumption that increases
in the cost of construction will be moderate in
1947, and that any increases in the materials price
index and labor rates will be in part, at least,
offset by the increased volume of building materials
called for by the 1947 Government program and
the possibility of more normal operations; that
the remaining controls on non-residential will be
eased; and that there will be no general business recession in 1947 severe enough to impede
construction.
There is no question but that the most important bottleneck in 1946 construction—material
shortages—is becoming less and less of a problem.
The outlook now is for sufficient materials production, barring severe work-stoppages, to cover
1947 requirements for residential construction
even allowing for the projected increase. Except
for one or two items, the chief problem in the current year will be one of distribution to smooth out
the flow of materials which was one of last year's
big problems and played such an important part
in building costs.
What about building costs?
The " experts" are well divided about the trend
of building costs during 1947. One school holds
that the end of the upward trend in construction
costs is not yet in sight. As the volume of construction gains momentum the demand for both
skilled and unskilled workers is expected to keep
labor rates at peak levels throughout the year.
Likewise, in spite of the increased output, higher
production costs and an insatiable demand will
work toward maintaining building material prices.
On the other hand, there are those who believe
that there is a chance for the over-all costs of
building a home to show a decline. More efficient
methods of construction, large-scale operations,
shorter building time because of a smoother flow
of materials, will all operate to reduce buildingcosts next year. Increased supplies of materials
should also begin to have a dampening effect on at
least some of these prices before the year is out.
There is a significant factor which cannot be
overlooked in discussing future trends in buildingcosts. As a "buyers' " market gradually replaces
the recent "sellers' " paradise, there will be increasing pressure on high building costs and high
152
priced homes, for the supply of prospective home
owners at such levels is strictly limited. The
importance of costs in the continued high volume
of residential construction was emphasized in the
President7s Economic Report referred to previously.
" T h e price problem in housing is even more
serious than in other lines because the gap between consumer income and housing prices is so
great . . . Even if the backlog demand provides a ready market for all the housing which is
produced in 1947, this superficially satisfactory
situation would plant the seeds of a collapse in
residential construction within a few short years
because the number of families who can afford
high priced houses comprises only a small part
of the population."
Mortgage financing prospects
In view of the amount of private residential
construction scheduled for the coming months, it
should follow that the demand for mortgage funds
will continue throughout 1947. Economic trends,
however, are subject to unpredictable fluctuations.
Somewhat paradoxically, therefore, it may not be
surprising if mortgage lending activity in the
current year does not equal its record 1946 volume.
An important factor in this trend will be the
decline in the volume of financing required for the
sale of existing properties which formed such a
large part of last year's business. People are beginning to lose the war-acquired habit of being "on
the move." There is less transferring from one
section of the country to another as more permanent jobs are found. Also, as the prospects of
obtaining a new home or apartment become
brighter, many families will be willing to put up
with their temporary arrangements until these are
available. There is a definite possibility then that
the volume of mortgage recordings, using this as
a measure of real estate financing activity, will
not be so high in 1947 as it was last year. New
loans made by all savings and loan associations
will in all likelihood follow this trend, but the
combined 1946-1947 total should approach a
record $7 billion.
Because loans for new construction will play a
more important role in the total home financing
picture during the coming year, the outstanding
balance of loans on 1- to 4-family nonfarm homes
is expected to show a substantial increase next
Federal Home Loan Bank Review
year. Loans on new properties represent a gross
addition to the outstanding debt, in contrast to
transfers of existing properties which generally
result in an increase amounting to the difference
between the old and new mortgages on the properties, if they are re-cast. By the end of 1947,
the total nonfarm home mortgage debt should
have passed the $25-billion mark. The net increase
during the year may prove to be one of the largest
in recent years.
Savings must be emphasized
One of the big questions about 1947 is the volume of new savings which may be expected. By
the end of 1946 the rate of savings by consumers
had dropped to about 10 percent of their disposable income—or approximately equal to the 1940
rate and only slightly above the 1935-1939 average. The President's Economic Report hints that
the rate probably will not fall below this amount
unless forced down by adverse economic conditions. If the predictions for favorable trends in
consumer income during the coming year are realized, it is probable that the 1947 volume of savings
will not be greatly different from the amount
accumulated last year.
Competition for savings accumulated during
1947, however, will be even more keen, and demands for use of cash reserves will be at an all-time
high. Reservoirs of private savings will be tapped
to provide the funds needed for residential construction as well as for the expansion of industrial
and commercial plant facilities and equipment.
Only the consistent use during the coming months
of every sound means to stimulate savings will enable institutions to continue receiving their share
of the new savings funds.
For the individual institution
Against a background of these over-all estimates
of 1947 activity, the managing officer and board of
directors of each member institution can measure
the prospects for their own association. They
have the advantage of having particular knowledge
about the conditions in their own community
which may vary from the national pattern for
good and logical reasons. With such information
they can come up with the answer, which best fits
their own associations, to the problems which face
the savings and loan industry in 1947.
February 1947
The Housing Expediter's Report
•
T H E Housing Expediter's January Report
summarizes the outline for housing in the
coming year. Objectives of the 1947 housing
program are to obtain the greatest possible number of dwelling units at moderate cost and to
enable veterans to obtain housing that best meets
their needs, particularly homes for rent. Government assistance and controls, therefore, are being
continued wherever necessary. Controls are being
relaxed when such action will result in a greater
volume of housing.
There is every indication that 1947 will be a
big construction year. Industry and Government
spokesmen have estimated that a million homes
will be put under construction and about a million completed during 1947. But there are still
serious problems yet to be overcome. Although
the critical supply situation existing during much
of 1946 has been eased for a number of materials,
there are still some currently in short supply; for
these materials, production aids, such as premium
payments, allocation orders and priorities for producers, are being continued. This year should see continued improvement in the over-all supply picture.
Increasing production of materials will bring
about better distribution and should make possible the gradual relaxation of existing controls.
I t is expected that lower building costs will result from greater efficiency in construction and
production.
Labor supply—a key point
As construction expands, the demand for construction labor will increase. Vigorous effort in
the recruitment and training of workers by labor
and builders and communities will be required
during 1947 in order to avert labor shortages in
construction.
In conclusion, the report emphasized that industry and local communities must assume an
even greater responsibility than was required in
the initial stages of the veterans housing program.
More reliance is being placed on the over 700
Mayors' Emergency Housing Committees. With
materials more plentiful and Federal controls
relaxed, local solutions of problems, such as labor
supply, site development and stimulation of rental
housing and conversions, assume even more
importance.
153
(1935-1939=100)
Index
550
^
|
Index
'
1
500 !—
a LOAN
FHLBA)
1
INDUSTRIAL
©PRIVATE
CONSTRUCTION
Urban 1 & 2 - Family Dwelling Units
(LABOR DEPT.)
© S A > ZINGS
(1935-1939 = 100)
250 1
'
PRODUCTION /
(FED. RESERVE) y
200
L ENDING
(
450
150
r f<\\
too
400
1941
1943
1944
1945
1946
1943
1944
1945
1946
1942
Index (1935 -1939 » 100)
350
200
i
^.r
300
150
100
250
y"
200
\^l
150
V\ y
Index
A v QXy
250
50
150
Index
1943
1944
1945
(1935-1939*100)
INCOME PAYMENTS
(COMMERCE DEPT.)
200
1942
1942
300
100
1941
1941
100
1946
(1935-1939-100)
1941
1942
1943
1944
1945
1946
1942
1943
1944
1945
1946
Millions
$1,200 r
180,
BUILDING COST INDEX
Standard six-room house
INHA)
$300 1
120
1
FHLB
ADVANC
A
ES
OUTSTANDING
200
^
100
1941
u
-\/V
V
wv A/V \
1942
1943
1944
I
II
80
\
40
^
1945
1946
REPUI*CHASE RATIO
sured S 8 L Assns.
All in
K
U\HswAbhm
1
1
1941
1942
\
N
\1 ^ \
'
1943
1944
1945
1946
'
OPERATING ANALYSIS DIVISION
FEDERAL SAVINGS AND LOAN INSURANCE CORPORATION
((((((MONTHLY
Usual seasonal trends
apparent in business conditions
Temporary reduction of coal supplies due to the
November strike was the principal factor in a decline of 3 points in industrial production during
December. I n that month the Federal Reserve
Board's seasonally adjusted index stood at 179
percent of the 1935-1939 average. This was the
lowest point reached since August 1946, but 16
points above the December 1945 mark. The output of durable manufactures decreased somewhat
more than nondurables during the reporting month
but by early January steel operations were raised
to the peak rates achieved in mid-November. I n
general, the production of building materials during the month continued at or above November
levels.
Department store sales followed the usual yearend trend of a sharp increase in December, followed by a post-holiday decline in the first weeks
of January. The December volume, as measured
by the Federal Reserve Board's seasonally adjusted index (1935-1939 = 100) rose 2 points to 274
compared with 218 in the same 1945 month. Indicating the beginning of the end of the wartime
sellers' market was the reappearance of " bargain
sales," some even during the Christmas buying
rush. Total sales during 1946 were about a fourth
greater than in the previous year but a substantial
proportion of this increase undoubtedly reflects
higher prices of merchandise available. The general level of wholesale commodity prices advanced
slightly from the middle of December to the latter
part of January, reflecting chiefly higher prices of
industrial goods. The largest price increase in
commodities included in the BLS index was that
I n d e x ..
[1935-1939=100]
Dec.
1946
Nov.
1946
Percent
change
Dec.
1945
H o m e construction (private) L._
B u i l d i n g m a t e r i a l prices, _ Savings a n d loan lending i
Industrial production i
Manufacturing employment1._ _
I n c o m e p a y m e n t s i_._
191.4
176.2
430.0
179.0
153.1
260.5
' 215. 4
162.5
441.7
182.0
' 150. 6
' 259. 2
-11.1
+8.4
-2.6
-1.6
+1.7
+0.5
173.8
133.4
318.2
163.0
131.1
234.1
r
1
Revised.
Adjusted for normal seasonal variation.
February 1947
Percent
change
+10.1
+32.1
+35.1
+9.8
+16.8
+11.3
S URVEY » » »
shown by building material prices which rose 7
percent between the year-end and the week ending
January 25.
Non-agricultural employment in December remained a t about the November level after allowances for seasonal increases in trade and postoffice
workers and the usual decline in construction
employment. These offsetting factors increased
unemployment by about 200,000 which is a normal
mid-winter trend.
Currency in circulation was down somewhat
from the year-end high as is usual at the beginning
of the year b u t was still almost $450,000,000
higher than in mid-January of 1945. Commercial
and industrial loans, following the rapid expansion
of the summer and fall months, increased only
slightly during the final month of the year. The
Treasury retired an additional $3.3 billion of
notes during December bringing the outstanding
Government obligations to $262 billion at the end
of the year.
Building activity down
seasonally in December
Privately financed nonfarm residential construction dropped 24 percent from November
largely in response to seasonal influences. However, the 35,000 building permits issued in
December were approximately 20 percent more
than in the same month of 1945 or 1941.
Permits for the construction of single-family
units continued to dominate private construction,
with 88 percent of all December permits issued
for that purpose. This was about equal to the
November ratio but somewhat higher than was
shown in December 1945 and just under the proportion in that month of 1941. During the
reporting month, 3,000 permits were issued for
multi-family units—9 percent of the December
total. The ratio of 2-family dwellings to total
private construction declined slightly in the reporting month.
No publicly financed units in urban areas were
reported in December, culminating a decline evident since September for this type of project.
[TABLES 1 and 2.]
155
Dwelling Units -Thousands
1944
Millions
1945
1946
Percent
1944
1943
1946
1944
1945
1946
1
Cost indexes continued to
show accelerated gain
A 4-point jump in the ordinarily slow moving
index of costs for constructing a standard sixroom frame house indicated the pace at which
material prices and labor rates rose during the
closing months of 1946. The gain in home construction costs during the fourth quarter as
measured by this index was almost as much as
in the preceding nine months.
The combined index for the standard six-room
frame house rose to 161, an increase of more
than 2 percent over November. Material prices,
again in the limelight, gained 3 percent during the
reporting month. Labor costs moved upward
by 1 percent. The material and labor indexes
now stand at 159 and 165, respectively.
The story of wholesale building material prices
followed the same pattern. The BLS index was
up more than 8 percent in December alone, following an identical gain in November. At the
end of the year, this index stood at 176 percent
of the 1935-1939 average. Increases in the
lumber and plumbing and heating commodity
groups were the largest. [TABLES 3, 4 and 5.]
Savings and loan lending
showed slight decline
Approximately $254 million of new mortgage
loans were closed by all savings and loan associations during the final month of 1946. Although
this represented a decline of 7 percent from No156
vember, new lending during the reporting month
continued at a relatively high level, being over
one-third greater than in December 1945.
Loans for new home construction displayed
resistance to the year-end decline, and were
down only 2 percent. They totaled $50 million,
more than double the amount shown in the final
1945 month. Home purchase lending was down
11 percent in the reporting month but remained
17 percent higher than in December the year
before.
That the relative importance of these two types
of loans in total savings and loan lending is
gradually moving toward the prewar pattern is
evident from a comparison of recent December
figures. The ratio of construction loans to the
total rose to 20 percent from 12 percent in 1945,
while that of home purchase loans dropped to
60 percent from 69 percent. In December- 1941
the ratio was 30 percent for construction and 43
percent for home purchase loans. [TABLES 6
and 7.1
New mortgage loans distributed by purpose
[Dollar amounts are shown in thousands]
Purpose
December 1946
November 1946
Percent
change
December 1945
Construction
H o m e purchase
Refinancing
__ - R e c o n d i t i o n i n g - - - _._
O t h e r purposes
$50, 233
151,848
22,116
6,040
23,464
$51,187
170,162
21, 625
7,034
21,468
-1.9
-10.8
+2.3
-14.1
+9.3
$22,922
129, 557
17,848
3,958
13,425
+119.1
+17.2
+23.9
+52.6
+74. 8
253, 701
271,476
-6.5
187, 710
+35.2
Total
Percent
change
Mortgage recordings by type of mortgagee
[Dollar amounts are shown in thousands]
December
T y p e of lender
Savings a n d loan associations
I n s u r a n c e companies
_ __
B a n k s , t r u s t companies
__
M u t u a l savings b a n k s _ . _ _ _
Individuals
Others..
. _ __
Total
_.-
..
savings banks recorded 6 percent of the activity
and insurance companies, 5 percent. [TABLES 8
and 9.]
Cumulative
Percent
1946
amount
Percent
change
from 1945
1946 (12
months)
$254,477
44,548
232, 032
46, 941
147, 613
110, 793
+30.9
+101. 5
+109. 8
+85.8
+25.8
+92.2
$3,421,027
474, 852
2, 685, 061
547,977
2,023,015
1, 257, 899
32.9
4.5
25.8
5.3
19.4
12.1
836, 404
+58.6
10,409, 831
100.0
of total
December mortgage recordings
were down 4 percent
During December, the estimated volume of
financing of mortgages of $20,000 or less amounted
to $836 million—a drop of 4 percent for the month,
or about the normal seasonal decline. A 4-percent rise for insurance companies and a fractional
gain for banks and trust companies were exceptions to the smaller volumes reported by other
types of mortgagees in December. The recordings of individuals were down 10 percent, while
the volumes of mutual savings banks and miscellaneous lenders were off 5 percent and savings
and loan associations showed a 4-percent decline.
According to estimates for the month, savings
and loan associations had about 30 percent of the
mortgage business of loans of $20,000 or less,
while commercial banks ranked second with 28
percent. Individuals had an 18-percent share
and miscellaneous mortgagees, 13 percent; mutual
Outstanding FHLB advances
at all-time high
The net effect of financing operations of the
F H L Banks during 1946 left the balance of
advances outstanding on December 31 at $293
million, half again as much as at the same time
the year before. Following the usual seasonal
trend, the year-end balance was up from November, showing a gain of 14 percent during the reporting month.
F H L B advances to member institutions during
December were the largest for any 1946 month.
Totaling $51 million, they were one and a half
times greater than the amount borrowed by members during November. Aside from December
1945 advances, which were affected by financing
operations incident to the Victory Loan, the
volume of funds advanced in the final month of
1946 was the largest in any December since the
establishment of the Bank System.
During the reporting month, members repaid $16
million on their obligations to the Banks, effecting the largest monthly reduction since July of
last year. In conformance with the usual seasonal
pattern, December repayments were greater than
those received in November (up 14 percent)
although they remained somewhat below the
December 1945 amount. [TABLE 12.]
(Continued on p. 164)
Index (1935-1939 = 100)
Index ( 1 9 3 5 - 1 9 3 9 = 100)
Millions
200
$300
CONSUMER S'
PRICE IND EX
I PRIVATE SHARE CAPITAL
All Insured
Associations
BUILDING MATERIALS
Wholesale Price Index
(LABOR DEPT.)
(LABOR DEPT.
UH KM
\yr
\fmr
mFiam**
\
yf*.
s~
COMBINEDt
INDEX J*
J}
T 7
a-
f PLUMBING a HEATING
. . . « . - • ^BRICK
_300l I I 1 I I I I I 1 I I I I I 1 I I 1 I I I I I I I I 1 I I 1 I I I I I 1
1944
February 1947
1945
1946
1 1| 0I 01. L
I . ! I 1 1 1 <
1944
Mhllllhl
> < I M 1 I 1 1 I > I
100
F-S
d TILE
• I I I r 1 I . I i . I . • I .
I I I I I I I I I I
157
Table 1 . — B U I L D I N G A C T I V I T Y — E s t i m a t e d number of new family dwelling units provided
in all urban areas in December 1946, by Federal Home Loan Bank District and by state
[Source: IT. S. Department of Labor]
T o t a l u r b a n residential
construction
P r i v a t e residential c o n s t r u c t i o n
Federal Home Loan Bank
District and state
1- a n d 2-family dwellings
Dec
1946 P
U N I T E D STATES .
Boston
21,348 1 28,661 |
__ _ _
759 1
_
165 1
Connecticut
__ . _
Maine,
_. _ _ _.
Massachusetts
New Hampshire
Rhode I s l a n d
Vermont-
13
486
10
75
10
New York
2,096
N e w Jersey
New York
._
. . .
Pittsburgh _
_
Alabama
_.
D i s t r i c t of C o l u m b i a
Florida
. . . .__ __
Georcia _ _ __
Maryland
N o r t h Carolina S o u t h Carolina
Virginia
_. .
Cincinnati-
- _
.
.
.
Kentucky
. _ .
Ohio
. .
Tennessee
Indianapolis
Indiana
- _
Michigan
Chicago
Illinois
. . __
Wisconsin
Des Moines.
__
Iowa _
Minnesota.
___ _
Missouri
__
_
_
N o r t h D a k o t a __
South Dakota
Little Rock
Arkansas. _____
Louisiana__
Mississippi
N e w Mexico _ . _
Texas
Topeka . _ _
Colorado.
Kansas
Nebraska
Oklahoma
S a n Francisco
Arizona
California
Idaho
Montana
Nevada
Oregon
Utah
Washington
Wyoming _
.
_ _ __
. _ _-
2,888
Dec.
1945
Nov.
1946'
Dec.
1946 P
Dec.
1946 P
Dec.
1945
25,341
16,735
2,919
3,198
715
1,264
322
44
258
71
10
199
18
24
4
165
13
446
6
75
10
415
115
569
24
122
19
67
10
199
18
24
4
40
4
258
901
1,036
1,916
752
1,060
972
149
587
1,329
360
392
328
732
261
711
101
48
349
32
18
21
6
12
16
5
742
100
358
349
100
2,521 j
370
730
1,185
635
116
34
254
82
7
611
112
10
1,011
164
238
77
4
24
4
4,134
4,427
3,424
3,431
4,186
2,582
703
241
549
255
1,423
357
288
514
150
598
705
168
1,382
363
685
489
103
532
294
579
1,647
238
155
275
80
156
385
80
1,261
357
268
476
150
454
697
148
1,279
359
677
485
103
438
294
221
1,198
238
150
253
80
148 !
164
175
162
20
38
8
20
103
4
8
4
144
94
8
1,279
1,950
1,202
1,150
1,801
926
129
149
276
50
854
298
148
781
221
46
582
298
129
4
145
4
272
l706lT
223
845
17877"
1,690
187
72_r
116
305
252
19
30
37402~
183
394
196
65
2,564
790"
347
85
39
319
5782T
173
4,614
85
14
130
342
89
358
19
1,043"
390
653
1,070
853
217
796~" "
189
321
229
19
38
2,670
299
1,138
364
1,657
588
1,069
5,549
112
4,260
92
40
197
243
169
420
16
173
394
288
126
2, 548
1,073
242
383
150
298
7,317
149
6,180
105
53
15
224
159
387
45
140
314
219
26
1,971
824
230
209
126
259
17259"
901
358
T7T82"
232
561
307
25
57
3730T
173
366
208
126
2,427
4~96T
1,039
232
359
150
298
6,552
91
3,736
86
40
197
209
169
420
16
125
5,500
105
47
15
210
129
376
45
995"
223
772
17272"
1,105
167
621
66
302
207
19
27
3,160
133
394
185
65
2,383
682"
255
85
36
306
5,074
159
3,917
85
14
130
329
78
343
19
650
4 1
10
1,017
176
34 1
122
4
1,203
1,296
244
596
374
25
57
37529"
Dec.
1945
18,429
762
913
229
85T
189
337
268
19
38
2,810
146
350
237
26
2,051
888"
254
245
126
263
Nov.
1946'
326
461
440
303
1,283
364
T767T
588
1,085
1,783
1,362 j
421 j
)
19,906
p Preliminary.
158
Nov.
1946 r
848
2,040
1,078
405
673
1,142
__
415 1
115
827
24
122
19
Dec.
1946 P
3- a n d more-family dwellings
752
1,344
148
910
221
__
1,522
Dec.
1945
424
612
11
Delaware
Pennsylvania _ _ _
W e s t Virginia
Winston-Salem
Nov.
1946 '
P u b l i c residential c o n s t r u c t i o n
35~
15
20
72~
60
12
55~
16
39
5
22
16"
73",
73 1
16
414"
351
63
114"
12
35
67
l40~
6
36
18
2TT
80
64
24
36
109
T05~
85
20
5T
500
500
50
50
3
45
3
242"
12~
50
28
80
11
181
108"
92
34~
10
24
4
1
585"
21
524
6
110" 1"
110
765"
24
680
12
3
13
750"
14
697
6
34 1
14
30
11
13
11
15
«• Revised.
Federal Home Loan Bank Review
Tabic 2 . — B U I L D I N G ACTIVITY—Estimated number and valuation of new family dwelling units
[Source:
U. S. D e p a r t m e n t of L a b o r .
Dollar a m o u n t s are s h o w n in t h o u s a n d s ]
N u m b e r of family dwelling u n i t s p r o v i d e d
P e r m i t -\ valuation
Private construction
Period
Private construction
Public
Total
construc- construction
tion
Public
construction
Total
construction
Total
1-family
2-family
715,200
619,460
533,185
28,393
57, 882
32, 777
29,962
26,775
1,444
1,743
2,815
114, 733
104,442
96, 662
246, 739
229,157
202,592
9,966
16, 599
17,582
894,251
848,175
758,327
650
128,468
127,065
112,467
4,912
9,686
1,403
119,891 3,307,796 2, 970,442 2,684,882
105, 966
179, 594
337,354
147, 800
169, 037
316, 924
286, 437
265, 321
231, 938
235, 336
246, 251
224,140
233,066
188,830
139,802
5,222
6,969
12, 098
10, 991
13, 754
9,531
8,217
9,014
9,290
8,590
7,667
4,623
9,282
9,043
23, 934
13, 420
17, 063
14, 317
13, 269
17, 236
13, 833
19, 958
15,927
12,312
13, 981
16, 654
18,135
29, 766
51, 446
54, 919
59, 557
62, 573
20, 683
9,369
244
27
70,117 1,617,981 1,380,736 1,175,598
237,245
3- a n d
morefamily
1-family
2-family
3- a n d
morefamily
95,740 $2,502,818 $2,180,805 $1,952,003
$69,429
$159,373
3,468
4,312
10,291
33,696
56,152
46,076
Total
Nonfarm
1941
December
_.
1945
December
__
_. ._
_
r
29, 750
29,100
25,116
1,426
2,558
796,800
676,909
604.538
25,393
46,978
44,800
49, 500
84, 500
82, 900
88, 700
76,100
80, 400
82,100
65, 800
60. 200
46, 600
35, 200
39, 111
43, 342
77, 002
70, 478
68, 758
58, 340
60, 586
62, 090
57, 044
58, 492
46,478
35,188
34, 782
38, 689
68, 461
64,182
60, 549
52, 712
45, 462
55, 931
50, 945
51, 551
41,296
30, 978
1,395
1,889
2,783
2,671
3,417
2,264
2, 027
2,063
2,160
1,999
1,684
1,041
2,934
2,764
5,758
3,625
4,792
3,364
4,097
4.096
3,939
4,942
3, 498
3,169
439, 582
369, 465
295,024
22,752
51, 689
58,841
146,297
19,338
17,098
14, 514
1,169
1,415
2,240
70,863
62,788
56,295
2,957
3,536
8,075
162,039
150,712
125, 495
9,248
15,969
11,327
656,410
627,229
540,616
31,728
54,885
29,181
650
96,443
95,040
80,639
4,275
10,126
1,403
101,015 2,383,355 2,101,446 1,829,025
102,057
170,364
281,909
4,947
6,659
11, 749
10, 688
13, 304
9,171
7,842
8,654
8,960
8.290
7,397
4,396
8,941
8,659
23, 400
12, 755
16,109
13, 617
12, 489
16, 261
12, 923
18, 821
14,952
11,437
13, 981
15, 747
15, 996
26,153
43, 790
40, 992
42, 956
54, 347
19,148
8, 555
244
_
1946
January.
February.
_
._
March
April..
._
May
June.. _ .
July
August
__ __• _ . _
September.
October
November1
.
D e c e m b e r P _.
$322,013
_
_.
. .
__
..
5,689
6,158
7,498
12,422
19, 942
17, 760
19, 814
20, 010
8,756
1,708
122
12
176, 285
201, 703
371, 091
340, 614
347, 584
310, 705
316, 379
335, 074
267, 946
270, 983
212,668
156, 764
162, 304
185, 049
352, 956
310, 848
296,138
255, 786
256, 822
272, 501
247, 263
261, 614
212,424
156, 737
Urban
1941
December
_._ ._ __. __
1945
D e c e m b e r r_
. .
__
1946
January
... .
February.
_ __ .
March
April..
.
M a y ...
June.., _ . . . . .
.
July
A u g u s t _ . . . __ _
._
September
..
_.
October..
. ...
...
November1
._ . . .
_ __
December p .
r
19,906
19,256
15,494
1,241
2,521
527,229
426,214
357, 947
24,125
44,142
31, 607
34, 370
56, 503
55, 603
60,167
51, 270
52,131
55, 081
43,087
37, 401
28,661
21,348
25, 918
28, 503
50, 066
44, 996
43, 583
36, 660
36, 830
38, 660
35,044
36, 067
28,539
21,348
21, 786
24, 072
41, 785
39, 000
35, 824
31, 372
31, 071
32, 921
29, 335
29, 576
23, 747
17,458
1,309
1,792
2,683
2,571
3,267
2,144
1,902
1,943
2,050
1, 899
1,594
971
2,823
2,639
5, 598
3,425
4,492
3,144
3,857
3,796
3,659
4, 592
3,198
2,919
Revised.
5,689
5,867
6,437
10, 607
16, 584
14, 610
15, 301
16, 421
8,043
1, 334
122
132,967
147,633
268, 533
245, 565
255, 110
223, 734
220, 350
247, 818
191, 826
192,148
149, 541
108,130
118, 986
131, 886
252, 537
219, 412
211,320
182, 742
177, 394
193,471
172, 678
183. 593
149,297
108,130
105, 098
116, 568
217, 388
195, 969
181, 907
159, 954
157, 063
168, 556
150,795
156, 482
126,948
92,297
p Preliminary.
Table 3 . — B U I L D I N G COSTS—Index of wholesale prices of building materials
[Source: U. S. Department of Labor. 1935-1939=100; converted from 1926 base]
All b u i l d i n g
materials
Period
1944:.December
..
1945: D e c e m b e r
1946: J a n u a r y
February
March
April
May
June
July
August
September
October
November
December
...
. _ _
_
__
_
.
Percent change:
D e c e m b e r 1946-November 1946
D e c e m b e r 1946-December 1945
February 1947
Brick a n d
tile
Cement
Lumber
Paint and
paint materials
Plumbing
and heating
Structural
steel
Other
130.0
115.9
107.0
171.3
130. 7
121.4
103.5
111.7
133.4
128.4
110.3
175.7
132.5
124.8
103.5
114.5
134.0
135.0
139. 5
141.3
142. 7
145.1
147.5
148.2
149.2
150.5
162.5
176.2
128.7
128.7
129.2
132.0
132.6
133. 5
134.8
138.7
140. 5
140.7
142.1
143.1
111.0
111.4
112.3
112.4
112.6
112.6
114.1
116.1
116.9
116.9
117.4
117.3
176. 5
178.3
186.6
190.9
192.1
196.0
197.4
197.8
198.4
199.2
213.9
253.0
132.5
132.5
132.5
132.8
133.0
133. 5
141.3
140.0
143.5
146.6
186.0
191.1
124.8
124. 9
124.9
132.4
132.4
139.3
139.3
139.7
140.8
140.8
140.8
151.0
103.5
109.7
115.9
115.9
115.9
115.9
115.9
115.9
115.9
115.9
115.9
115.9
115.3
115.9
121.4
122.0
125.1
128.0
129.7
130.7
131. 3
132.5
135. 5
142.5
+8.4
+32.1
+0.7
+11.4
-0.1
+6.3
+18.3
+44.0
+2.7
+44.2
+7.2
+21.0
0.0
+12.0
+5.2
+24.5
159
Table 4 . — B U I L D I N G COSTS—Index of building costs for the standard house
Average m o n t h of 1935-1939=100]
Element
Material
Labor
D e c . 1946 N o v . 1946 O c t . 1946 S e p t . 1946 A u g . 1946 J u l y 1946 J u n e 1945 M a y 1943 A p r . 1946 M a r . 1946 F e b . 1946 J a n . 1946
_
Total
D e c . 1945
158.9
164.8
153.8
163.1
150. 5
161.6
148.3
159.3
146.1
157. 2
143.7
155.6
141.6
153.8
139.2
152.5
138.0
150.6
137.1
148.9
136. 3
148. 5
135.5
147.9
135.2
147.5
160.8
156.9
154. 2
151.9
149.8
147.7
145.7
143.6
142.1
141.0
140.3
139.7
139.3
Table 5 . — B U I L D I N G COSTS—Index of building costs in representative cities 1
[Source : N a t i o n a l H o u s i n g A g e n c y .
-
Average m o n t h of 1935-1939=1001
1946
1947
1945
1944
1943
1942
1941
Jan.
Jan.
Jan.
Jan.
Jan.
F e d e r a l H o m e L o a n B a n k D i s t r i c t a n d city
Jan.
New York:
Buffalo, N e w Y o r k
Indianapolis:
Indianapolis, Indiana
D e t r o i t , M i c h i g a n . . _.
_
__.
_
.
Des Moines:
Des Moines, Iowa.
St. L o u i s , M i s s o u r i
Fargo, North D a k o t a
Sioux F a l l s , S o u t h D a k o t a
_
_ __
__
__ ___ ...
_____
_
__ _
__
_ _
Apr.
Jan.
182.6
175.4
166.0
151.6
149.6
144.6
135.8
128.2
123.7
108.8
162.0
191.1
148.2
171.1
146.5
162.7
142.7
160.7
141.7
156.3
138.1
152.3
133.9
147. 7
121.2
126.5
114.0
119.6
102.0
112.0
151. 7
177.5
148.2
160.3
140.4
164. 9
137.8
148.7
124.9
161. 8
134.4
143.8
122.7
14*. 8
129.5
135.9
121.5
150.3
128.1
133.8
120.7
126.4
126.7
130.8
118.3
119.2
123.9
127.7
116.3
120.6
121.1
124.3
113. 8
120.2
111.5
117.4
105.2
108.5
102.6
105.5
138.8
188.9
166.9
147.1
154.3
181.7
150.9
156.5
128. 9
173.0
151.4
143.8
150.7
168.8
141.5
147.5
124.8
169. 3
147.0
141.2
143.0
159.7
138.2
142.9
122.9
161.4
141.1
138.9
133.9
151.5
132.0
137.9
12.1.9
153. 7
138.4
138.9
130. 8
142.5
130.5
135. 7
122. 3
150.9
135.8
138.1
133.0
143.4
129.7
138.9
118.5
146.5
128.4
133.1
124.6
138.5
123.3
131.9
111.4
130.9
110.3
114.9
119.0
121.2
116.1
113.6
118.3
122.7
103.9
101.6
103. 3
111. 6
109.0
102.2
1C3.8
107.0
.
___
San F r a n c i s c o :
P h o e n i x , Arizona
__.
L o s Angeles, California __ _.
S a n F r a n c i s c o , California
Boise, I d a h o
______
Reno, Nevada
___
P o r t l a n d , Oregon
__
Salt L a k e C i t y , U t a h
__ __
Seattle, W a s h i n g t o n _ . . .
1
_
July
Oct.
125.9
119.2
133.9
119.7
124.4
For complete explanation of these data, see Statistical Supplement to April 1946 REVIEW.
Table 6 . — M O R T G A G E LENDING—Estimated volume of new home mortgage loans by all
savings and loan associations, by purpose and class of association
[Thousands of dollars]
Class of association
P u r p o s e of loans
Period
1944
December
___
___
1945
December
1946
January
February
Mareh_
..__ _
April
.__ .
May
June _
_.
July
August
_
September
October.
November
December
160
__. _
__
_._
__
_ _ _
_,
__
. . .
_.
...
Reconditioning
L o a n s for
all o t h e r
purposes
Total
loans
State
members
Nonmembers
Construction
H o m e purchase
Refinancing
$95,243
$1,064,017
$163,813
$30,751
$100,228
$1,454,052
$669,433
$648,670
5,244
81,508
13,555
2,127
8,704
111,138
51,586
49,921
9,631
180, 550
1, 357, 555
196,011
40, 736
137, 826
1, 912,678
911,671
836, 874
164,133
Federals
$135,949
22, 922
129, 557
17,848
3,958
13, 425
187, 710
90,920
81, 891
14, 899
615,542
2,356, 630
270,235
80,563
261,522
3, 584, 492
1,810,374
1,511,507
262, 611
30,807
30,866
45, 391
53,202
62,189
56,297
59, 708
59, 377
55, 354
60,931
51,187
50,233
145, 342
154,219
202,995
235,877
243, 458
218, 575
216, 369
211, 804
198, 842
207,139
170,162
151,848
21, 372
19,801
24, 244
24,882
24,451
22,402
21, 388
22,032
21,546
24,376
21, 625
22,116
3,803
4,217
6,198
6,796
6,954
6,625
7,327
8,481
8,027
9.061
7,034
6,040
15, 518
16,416
21, 335
22, 242
24, 246
22,098
21, 256
22,765
26,022
24,692
21,468
23,464
216,842
225, 519
300,163
342,999
361,298
?25,997
326,048
324, 459
309, 791
326,199
271,476
253,701
109,146
111, 927
155, 960
174, 468
186, 282
107, 552
165,031
165,812
154,105
165, 742
131, 607
122, 742
92,103
97, 305
123, 945
143,114
150,161
136.296
136, 966
134, 624
133,758
136,660
'116, 780
109,795
15, 593
16, 287
20, 258
25, 417
24,855
22,149
24, 051
24, 023
21,928
23, 797
23,089
21,164
Federal Home Loan Bank Review
Table 7.—LENDING—Estimated volume of
new loans by savings and loan associations
Table 8.—RECORDINGS—Estimated nonfarm mortgage recordings, $20,000 and under
D E C E M B E R 1946
[Dollar amounts are shown in thousands]
Federal H o m e
Loan Bank
D i s t r i c t a n d class |
Dec.
of association
1946
C u m u l a t i v e n e w loans
(12 m o n t h s )
Nr ew loan?
Nov.
1946
[Thousands of dollars]
Dec.
1945
1946
1945
Percent
change
S a v i n g s Insurance
and
Federal H o m e Loan
comloan
Bank District
associa- p a and state
nies
tions
UNITED STATES.__
U N I T E D STATES
$253,701 $271,476 $187, 710 $3, 584,492 $1,912,678
+87.4
90,920 1,810, 374
81,891 s 1,511,507
262,611
14,899
911,67l|
836, 874
164,133
+98.6
+80.6
+60.0
122, 742 131,607
109, 795' 116, 780
21,164 23, 089
Federal
State member
Nonmember
Boston
Federal
State m e m b e r
Nonmember..
.
N e w York _ .
Federal
State member
Nonmember..
Pittsburgh
Federal..
State m e m b e r
Nonmember
Winston-Salem
Federal
State member
Nonmember
Cincinnati.-.
Federal-. _ _
State member
Nonmember..
I n d i a n a p o l i s _.
F e d e r a l _ _ __. _.
State m e m b e r
Nonmember
Chicago
_
8,193
4,752
66, 797
3,627 4,387
473 1,148
4,345 13, 504
291
643
874
1,059
143
431
2,677
475
3,865
460
494
222
1,704
87
2, 585
54
282
40
16, 579
2,904
40,027
1,904
4,274
1,109
24, 812
4,108
21,029 20, 912
22,557
9,653 103, 071
7,233
17, 579
1,603
2,505
7,718 1,947
13,311 18,965
6,518
16.039
3,701
5,952
28, 720
74, 351
6,311
9,164
2,078
8,151
10,552
3,084
4,968
4,856
1,444
102, 778
112, 425
24, 462
53, 840
56,991
15,165
+90.9
+97.3
+61.3
New York
26, 727
29,180
18, 259
372,091
187, 331
+98.6
Pittsburgh
10,171
12,123
4,433
11,609
12, 960
4,611
6,455
8,537
3,267
156, 530
162, 723
52,838
18, 939
19,854
14, 324
267,106
73, 534
53,400
27, 782
6,724
5,082
2,518
134,256
85,444
47, 406
40, 881
43,028
25, 628
525, 631
243, 851 +115.6
21,449
16,169
3,263
22, 559
17,067
3,402
13,606
10,456
1,566
296,700
191, 484
37,447
128,459 +131.0
99,687 + 9 2 . 1
15, 705 +138. 4
+82.6
4 60.0
+70.6
40,005
42, 332
29, 839
565, 535
313,820
+80.2
17,889
19,695
2,421
18, 873
20,758
2,701
12, 673
15, 862
1,304
256, 744
280,970
27,821
135,090
158,388
20, 342
+90.1
+77.4
+36.8
13,701
15,974
11,282
210, 942
108,216
+94.9
7, 557
5,756
388
8,893
6,615
466
6,213
4,654
415
122,867
82, 782
5,293
24,108
26,308
19, 599
367, 792
58,605 +109. 7
44,997 + 8 4 . 0
4,614 + 1 4 . 7
214, 528
N e w Jersey
N e w York .
8,641
9,661
1,297
170,143
180, 356
17, 293
91,988
106,893
15,647
+85. 0
+68.7
+10.5
- .
14,776
15, 377
11,908
216,485
116,997
+85.0
Federal..
_ ._
State m e m b e r
N o n m e m b e r . . ___
8,014
4, 713
2, 049
8,380
5,103
1,894
6,534
3,882
1,492
120,170
69, 793
26, 522
61,444
40, 375
15,178
+95.6
+ 72. 9
+74.7
18, 795
2,585
18,550
986
7,700
7,218
55, 814
296
16, 814
1,685
162
1,990
433
238
15, 999
2,313
144
822
336
6,559
805
102
6,807
309
1,278
48,991
5, 545
Winston-Salem--.
25,075
6, 221
11,055
496
21,151
10,667
74,665
Alabama. _
D i s t r i c t of C o l . .
Florida .
Georgia. _ ._
Maryland
North Carolina.
South CarolinaVirginia. --.
1,076
3,460
5,739
2,621
6,456
2,149
518
3, 056
583
415
2,884
217
405
800
273
644
1,005
603
1.772
1,975
2, 465
713
720
1,802
496
916
2,027
9,687
1,424
1,789
1,585
823
2,900
1,273
1,104
4,141
1,468
815
875
426
565
4,853
7,609
24, 223
7,705
12, 426
6,122
2,760
8, 967
_ .
45,199
3,970
24, 701
1,186
8,021
9,994
93, 071
Kentucky.
Ohio
Tennessee. . . .
4,613
38,894
1,692
688
2,146
1,136
2, 016
19, 548
3,137
1,186
471
6.393
1,157
324
4,119
5,551
8,112
72, 286
12, 673
17,141
4,338
21, 622
16
5,281
6,097
54,495
9,667
7,474
1,781
2,557
7,838
13, 794
16
1,735
3,546
1,160
4,937
22,187
32, 308
27, 577
2,238
13, 671
25
9,781
13, 860
67,152
20, 689
6,888
1,481
757
8,400
5,271
25
5,666
4,115
12,384
1,476
48, 620
18, 532
15, 613
4,361
14, 280
719
7,033
9,073
51,079
3,975
6,322
4,463
611
242
461
1,717
2,109
22
52
4,274
4,213
5,327
279
187
1,343
2,300
3,080
166
144
815
4,124
4,037
89
8
10,868
19, 395
19,016
1,167
633
Cincinnati.--
Indianapolis-.
...
Indiana . . . _
Michigan. .
Chicago...
... .
Illinois . -.. _ _
Wisconsin . . _
12, 667
13, 575
8,673
188,124
90,802 +107. 2
5,077
7,412
178
6,140
7,291
144
4,234
4,344
95
87,140
99,110
1,874
44, 942 + 9 3 . 9
44, 678 + 1 2 1 . 8
1,182
+58.5
10, 796
10,469
10,063
168, 555
96,974
+73.8
6, 204
3,272
1, 320
5, 705
3, 325
1, 439
5,761
3,042
1,260
97, 947
51, 556
19,052
53,683
28,144
15,147
+82.5
+83.2
+25. 8
33,548
33, 592
26, 867
462,566
259,447
+78. 3
19,794
13, 609
145
20, 078
13, 359
155
15,111
11,515
241
265,099
194,864
2, 603
143,510
113,350
2, 587
+84.7
+71.9
+0.6
Iowa
...
M i n n e s o t a , _. .
Missouri.
North Dakota...
South D a k o t a . . .
F e d e r a l - . ___ ._ _
State m e m b e r
Topeka
Federal..
_ __ _
State member
.
Nonmember..
San Francisco
Federal
State m e m b e r
Nonmember
February 1947
719
14,626
7,106
5,311
11,889
11,517
50, 449
_
1,025
5.038
705
316
7,542
824
558
472
39
5,213
789
418
602
189
3,313
694
2,560
541
397
7,697
100
1,245
461
49
9,662
3,432
9,819
2, 781
990
33,427
T o p e k a . . . .__ __
11,882
2,042
5,816
7,117
6,045
32, 902
Colorado..
Kansas
Nebraska
O k l a h o m a . __
1,762
4,290
1,623
4,207
151
901
398
592
1,183
2,226
648
1,759
3.201
1,196
711
2,009
1, 223
1,313
196
3, 313
7, 520
9, 926
3, 576
11, 880
31, 707
6,702
86,059
Little R o c k . . . _
Little Rock _.
12
Delaware.
Pennsylvania.-.
W e s t Virginia._
+71.4
11, 701
13,163
1,444
Des Moines
9,938 20, 987
663
25
177
+90.2
11,003
11, 786
1,319
Federal..
__
State m e m b e r
Nonmember
877
125,996
9,518
6,587
3,749
$254, 477 $44, 548 $232,032 $46, 941 $147, 613 $110, 793 $836,404
3,521
696
15, 551
456
1,553
273
239,665
9,273
6,096
3,570
Total
22, 050
11, 268
+72.6
Other
mortgagees
Connecticut
Maine
Massachusetts-.
New H a m p s h i r e .
Rhode Island..Vermont .. . _
21, 787
154,716
Individuals
-. . _.
Boston
17, 553
66, 576 + 1 3 5 . 1
89, 971 + 8 0 . 9
30,784 + 7 1 . 6
Banks Mutual
and
savtrust
ings
companies b a n k s
A r k a n s a s ._
Louisiana
Mississippi
N e w Mexico
Texas-.
S a n Francisco
Arizona.
1,474
220
1, 939
California
. 19, 388 4,822 72, 323
143
898
457
Idaho
Montana
_._ .
53
552
743
Nevada..
50
262
443
Oregon.
2,134
617
1, 696
Utah
774
228
1,902
Washington
5, 679
732
6,081
5461
371
475
Wyoming.. ... 1
1, 634
168
I, 466
38,890
21,917 186,909
2,168
6,033
232
30,311 14,523 141,167
668
234
2, 400
448
1,812
16
599
1 422
68
1,951
1, 373
7, 939
282
140
3, 326
2,137
5, 297 21,392
34!
326 1
1 418
161
Table 9 . — M O R T G A G E RECORDINGS—Estimated volume of nonfarm mortgages recorded
[Dollar a m o u n t s are s h o w n in t h o u s a n d s ]
Savings a n d loan
associations
Banks and trust
companies
Insurance
companies
M u t u a l savings
banks
O t h e r mortagees
Individuals
All mortgagees
Period
Total
Total
Percent
1945._.
$2,009,707
35.7
$244,432
December.
194,440
36.9
22,112
1946...
January...
February..
March
April
May
June
July
August
September.
October....
November.
December.
3,421,027
220,420
217, 621
277,408
315,471
333,192
308, 226
314, 779
310, 723
290, 547
312,055
266,108
254,477
32.9
34.8
35.2
36.2
35.6
34.6
33.6
32.1
31.1
31.3
31.0
30.6
30.4
474, 852
26, 936
26,099
31,083
33,974
38,862
39,890
48,101
46, 527
47, 424
48,429
42,979
44, 548
Percent
Total
J Percent
Total
Percent
Total
Percent
Total
Percent!
Total
Percent
4.4 $1,091,021
19.4
$216,982
$1,402,103
24.9
$658,945
$5,623,190
100.0
4.2
110,588
21.0
25, 264
117,383
22.2
57,637
10.9
527, 424
100.0
4.5 2, 685,061
139,126
4.2
140,890
4.2
180,656
4.1
213,878
3.8
241,330
4.0
245, 624
4.3
263, 669
4.9
273,093
4.7
248, 406
5.1
275,769
4.8
"230, 588
4.9
232, 032
5.3
25.8
21.9
22.8
23.6
24.1
25.0
26.8
26.9
27.3
26.7
27.4
26.5
27.8
547,977
24,401
24, 973
33,914
44,855
51,851
50,123
58,020
53,616
51,978
57. 971
49,334
46, 941
19.4 1, 257, 899
23.9
71,633
22.7
68, 703
21.3
79, 926
20.3
98,770
19.4
111,892
18.4
104, 662
18.1
118,490
18.4
131,257
18.7
117,213
18.3
127, 946
18.9
116,614
17.6
110,793
12.1
11.3
11.1
10.4
11.1
11.6
11.4
12.1
13.1
12.6
12.7
13.4
13.3
10,409, 831
634,117
618, 763
765, 973
887, 266
964,438
917,414
981,187
999, 221
928, 878
1,006,681
869,489
836,404
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100. 0
Table 1 0 . — G I L E N D I N G — H o m e loans
4.0
4.4
5.1
5.4
5.5
5.9
5.4
5.6
5.8
5.7
5.6
2,023,015
151,601
140, 477
162,986
180,318
187,311
168.889
178,128
184,005
173,310
184,511
163, 866
147, 613
Table 1 1 . — F H A — H o m e mortgages insured
[Dollar a m o u n t s are s h o w n i n t h o u s a n d s ]
[ P r e m i u m p a y i n g ; t h o u s a n d s of dollars]
Cumulative through
N o . of a p plications
a n d reports
Number 2
126, 249
156, 786
209,334
257,986
305, 503
371,142
420,960
473, 784
524, 428
570, 883
614, 323
105,990
118,143
133, 972
165, 737
200, 231
257, 471
303, 353
356. 804
409,112
455, 293
502, 510
A m o u n t of
guaranty
a n d insurance 2
Principal
a m o u n t of
loan 2
Title II
New
1946: M a r . 30
A p r . 26
M a y 31
J u n e 28--.
July26
A u g . 30
Sept. 27
Oct. 25
N o v . 25
Dec. 25
1947: J a n . 25„ .
$214, 869
245, 046
283, 948
364, 514
454, 709
610, 007
737, 342
886, 216
1, 032, 596
1,165,641
1, 301, 681
T i t l e V I (603)
Period
$495. 385
555, 541
634, 812
804,907
994, 778
1, 316, 554
1, 584, 444
1.906, 743
2, 217, 347
2, 494, 547
2, 782, 379
1
R e c o r d s of V e t e r a n s A d m i n i s t r a t i o n .
2 T o t a l loans r e p o r t e d closed a n d d i s b u r s e d . T o t a l s do n o t include 62,675
loans acted u p o n a n d a p p r o v e d for l o a n closing. T h e i r dollar v o l u m e ,
$391,130,000, b r o u g h t t h e aggregate p r i n c i p a l of G I h o m e loans to $3,173,509,000
o n J a n u a r y 25.
1945: D e c e m b e r . . . . .
1946: J a n u a r y . ___ _
F e b r u a r y ....
March
April
May
June
. _ _.
Julv
August _
September _
October
November _ _ _ _ _
D e c e m b e r . ___
_.
Existing
New
Existing
$1, 965
$18, 051
$10, 836
$547
3,095
3,728
3,760
3,570
4,406
5,573
6,374
5,668
5, 279
6,576
5,354
6,619
24, 275
20, 006
24, 346
24,160
26, 389
31, 551
26,956
20, 831
20, 713
26, 553
20,175
21, 314
9,617
6,267
5,122
6,870
5,988
3,678
4,020
2,959
2,084
2,475
2,679
5,401
1,676
1,241
1,152
983
3,712
1,012
572
960
613
1,335
1,164
2,592
Table 1 2 . — F H L B A N K S — L e n d i n g operations and principal assets and liabilities
[ T h o u s a n d s of dollars]
L e n d i n g operations, P r i n c i p a l assets, D e c e m b e r 31,
D e c e m b e r 1946
1946
Federal H o m e Loan B a n k
Advances
Boston
.
New York
Pittsburgh
Winston-Salem _
Cincinnati
_
Indianapolis
Chicago
Des Moines
Little Rock .
Topeka
. . .
San Francisco...
____..
-.
.
.
. . _
_____
_.
... _
.
_ __
_ _.
___
_ _ _ . . _
_ _..
________
.
_ _ _
.
. . .
__
__
_-__
.
_ _
_ __
__ _
D e c e m b e r 1946 ( c o m b i n e d total)
N o v e m b e r 1946
D e c e m b e r 1945. __
_.
_
_
_
.
_.
_ _
__
_ .
Repayments
Advances outstanding
Cash 1
C a p i t a l a n d principal liabilities,
D e c e m b e r 31, 1946
Governm e n t securities
Capital 2
Consolidated
F H L Bank
obligations
Member
deposits
T o t a l assets, D e cember
31, 1946 *
$2, 686
3,622
1,857
9,480
3,085
2,239
9,101
6,115
3,486
1, 532
8,038
$3,115
2,218
1,592
770
2,179
819
2,157
602
300
523
1,955
$12, 028
24, 316
29,137
39, 551
24,462
24,148
50, 063
26, 825
16, 606
12, 723
33,596
$2, 333
4,876
2,673
2,556
4,805
5,860
7,017
922
1,351
2,442
4,879
$16, 946
24,123
10,443
4,118
27, 208
14, 232
8,472
8,942
8,618
9,038
12, 952
$21, 337
30, 040
19, 772
20, 778
29, 385
16,181
25, 978
15,654
13, 378
11, 734
27, 738
$9,000
3, 500
21,000
17,500
12, 000
20,000
30,000
17, 500
13, 000
11, 500
14, 000
$938
19, 934
1,316
3,366
15,078
8,019
9,414
3,467
165
956
7,595
51, 241
16, 230
293, 455
39,714
145, 092
231, 975
169, 000
70, 248
479, 564
20, 451
14,525
258, 444
21, 919
144, 281
231, 575
140, 000
54,129
426, 532
116, 849
18, 908
194, 872
28, 572
118,392
219, 217
68, 500
45,697
342, 710
$31,407
53,481
42, 397
46, 364
56, 705
44, 356
65, 646
36,768
26,662
24,269
51, 509
1 I n c l u d e s i n t e r b a n k deposits.
2 C a p i t a l stock, s u r p l u s , a n d u n d i v i d e d profits.
162
Federal Home Loan Bank Review
Table 1 3 — I N S U R E D A S S O C I A T I O N S — P r o g r e s s of institutions insured by the FSLIC
[Dollar amounts are shown in thousands]
Number
of associations
P e r i o d a n d class
of association
Total
assets
N e t first
mortgages
held
Cash
$3,763,128
$307,712
Operations
Federal
Home
N e w priLoan
New
Private
B a n k ad- mortgage v a t e inrepurvestvances
chases
loans
ments
P r i v a t e reGovernm e n t b o n d purchasable
holdings
capital
Government
share
capital
$5, 219, 910
$23,366
$185, 210
$144,664
$180,352
$71, 777
39.8
20,165
19, 374
19, 373
19,373
19,358
19, 358
16,832
16,306
16, 306
16,305
16, 305
16, 305
163,559
154,835
144,111
145, 744
159, 546
189,908
187,401
196, 495
216, 573
233,503
238,907
272, 904
169,107
174,954
238,268
268, 706
285,613
257,175
254,858
255,273
240, 708
254, 626
205, 776
193,814
283,487
182,679
198,176
198, 896
196,973
219,825
296, 710
207, 782
185, 754
202,178
172, 886
223, 646
205, 537
122,099
129, 573
123, 265
116, 370
86,017
224,686
140,849
135,144
129,272
112,127
87, 736
72.5
66.8
65.4
62.0
59.1
39.1
75.7
67.8
72.7
63.9
64.9
39.2
Repurchase
ratio
ALL INSURED
1945: D e c e m b e r
2,475
$6,148, 230
1946: J a n u a r y February
March
April May
June..
July....
August . .
September
2,477
2,481
2,485
2,486
2,488
2,490
2,493
2, 495
2,497
2,496
2,495
2,496
6, 204, 954
6, 274,832
6.359,998
6,462, 376
6, 592, 552
6, 743,121
6, 810,626
6,916,472
7, 012, 249
7,114,023
7,183,179
7, 318, 604
1945: D e c e m b e r
1,467
3,923, 501
1946: J a n u a r y February
March
April..May.
June
Julv—.
August . . .
September
1,467
1,468
1,469
1,469
1,471
1,472
1,473
1,473
1,474
1,472
1,471
1,471
3,955, 391
3, 999,837
4,050,719
4,118,076
4, 204,057
4, 311, 747
4, 344,421
4,411, 389
4, 469, 937
4, 537,135
4, 580, 447
4, 671, 503
1945: D e c e m b e r
1,008
2, 224,729
1946: J a n u a r y February
March
April.._
May.
June
July
August
September
October
1,010
1,013
1,016
1,017
1,017
1,018
1,020
1.022
li023
1,024
1,024
1,025
2, 249, 563
2, 274,995
2, 309, 279
2, 344, 300
2,388,495
2,431, 374
2,466, 205
2, 505,083
2, 542, 312
2, 576,888
2, 602, 732
2, 647,101
December_..
...
$1,839,008
4,051, 583
279, 543
1, 792,418
4, 519, 248
347, 362
1,641,628
4,922,400
289, 903
1, 566,979
5, 237, 560
376, 872
1,458,741
5, 299,668
5, 361, 314
5,432,080
5, 507,923
5, 589, 795
5,724,893
5,798, 380
5,869,338
5,922,507
5,995,695
6, 056, 207
6,193, 342
2, 382,101
194,678
1, 213, 609
3, 348, 567
18,058
137,839
90,920
120,195
44, 352
36.9
15, 250
14,540
14, 539
14,539
14,539
14,539
12,380
11,956
11, 956
11,956
11, 956
11,956
124, 242
118,501
109, 213
106, 599
115,009
137,605
134, 376
142,018
153, 096
164,305
165, 077
190,579
109,146
111,927
155,960
174,468
186,282
167, 552
165,031
165,812
154,105
165, 742
131,607
122, 742
190,748
122,452
132,145
132,092
130,551
144,470
194,872
136,777
121,872
132,882
113, 504
148,106
144, 388
82,173
86,471
81, 241
78,013
55,038
156,734
95, 328
90, 296
84, 518
71, 952
55, 346
75.7
67.1
65.4
61.5
59.8
38.1
80.4
69.7
74.1
63.6
63.4
37.4
FEDERAL
December . . . .
2, 571,919
169,884
1,175, 285
2,886, 641
221,431
1,067,943
3,151, 813
180, 457
1, 004, 260
3,357, 582
921,421
921,421
3, 395,108
3,435,482
3,481,382
3, 532,406
3, 586, 501
3,677,643
3, 716,445
3, 758,827
3, 790, 634
3,839,002
3,880,142
3, 970, 772
1,381,027
113,034
625,399
1,871,343
5,308
47, 371
53, 744
60,157
27,425
45.6
1,904, 560
1,925,832
1,950,698
1,975,517
2,003, 294
2,047,250
2,081,935
2,110, 511
2,131,873
2,156,693
2,176, 065
2, 222, 570
4,915
4,834
4,834
4,834
4,819
4,819
4,452
4,350
4, 350
4,349
4,349
4,349
39,317
36, 334
34,898
39,145
44,537
52,303
53,025
54,477
63,477
69,198
73.830
82,325
59,961
63,027
82,308
94, 238
99, 331
89,623
89,827
89,461
86, 603
88,884
74,169
71,072
92,739
60,227
66,031
66,804
66,422
75,355
101,838
71,005
63,882
69, 296
59, 382
75, 540
61,149
39,926
43,102
42,024
38,357
30,979
67,952
45, 521
44,818
44,754
40,175
32, 390
65.9
66.3
65.3
62.9
57.7
41.1
66.7
64.1
70.2
64.6
67.7
42.9
STATE
_
_. _
...
D e c e m b e r . __ .
1,479, 664
109,659
617,133
1,632,607
125,931
573,685
1, 770, 587
109,446
562, 719
1,879, 978
537,320
537,320
Table 1 4 . — S A V I N G S — S a v i n g s and loan share investments and repurchases, December 1946
[Dollar amounts are shown in thousands]
All associations
.Period
New
investments
1946
February 1947
Net
inflow
$2,337,558 $1,296,953 $1,040,605
1945
December
January
February
March
April
May
.
June
_._ ___
July
._
August..
September
October
November
December
_
Repurchases
..
_
.
__
__
________
I n s u r e d associations
Repurchase
ratio
New
investments
Repurchases
55.5 $1,876,969 $1,005,719
Net
inflow
U n i n s u r e d associations
Repurchase
ratio
New
investments
Repurchases
Net
inflow
Repurchase
ratio
$871,250
53.6
$460, 589
$291, 234
$169,355
63.2
42.4
180, 352
71, 777
108,575
39.8
43, 533
23,193
20, 340
53.3
1,138,943
63.8
2,568,992
1,612,645
956, 347
62.8
574, 829
392, 233
182, 596
68.2
90, 342
69, 813
84, 736
92, 622
99, 038
157, 550
85, 368
78,431
60,160
88,160
72, 726
159,997
73.0
68.3
65.2
62.7
59.9
41.6
76.1
69.3
73.8
64.8
66.2
41.3
283, 487
182, 679
198,176
198,896
196,973
219,825
296, 710
207, 782
185, 754
202,178
172,886
223, 646
205, 537
122,099
129, 573
123, 265
116, 370
86,017
224, 686
140, 849
135,114
129, 272
112,127
87, 736
77, 950
60, 580
68,603
75,631
80,603
133, 808
72,024
66,933
50, 640
72,906
60,759
135, 910
72.5
66.8
65.4
62.0
59.1
39.1
75.7
67.8
72.7
63.9
64.9
3Q.2
51, 474
37, 790
45,187
49,181
49, 740
49,869
60, 226
47, 472
44, 269
48, 338
42, 285
48, 998
39, 082
28, 557
29,054
32,190
31,305
26,127
46,882
35, 974
34, 749
33.084
30,318
24,911
12, 392
9,233
16,133
16,991
18, 435
23, 742
13, 344
11, 498
9,520
15, 254
11,967
24,087
75.9
75.6
64.3
65.5
62.9
52.4
77. 8
75.8
78.5
68.4
71.7
50.8
223, 885
94, 970
128, 915
3,143,821
2,004,878
334, 961
220, 469
243, 363
248, 077
246, 713
269, 694
356, 936
255, 254
230,023
250, 516
215,171
272, 644
244,619
150, 656
158,627
155, 455
147, 675
112,144
271, 568
176.823
169. 863
162. 356
142,445
112, 647
163
Amendments to Regulations
FHLBA
Bulletin N o , 84
Amendment to Rules and Regulations for the Federal
Savings and Loan System relating to collection and payment
of sales commissions.
(Adopted January 27, 1947; effective upon
filing with The Federal Register on January 30,
1947.)
The Federal Home Loan Bank Administration
has added the following new Section 203.22, as
proposed in FHLBA Bulletin No. 80 published
The Federal Savings and Loan Insurance
Corporation has amended paragraph (d) of Section 301.7 by adding the following sentence:
" N o sales commissions shall be paid by a n y insured
institution to any of its officers or directors for t h e
sale of a withdrawable or repurchasable share,, investm e n t certificate, or deposit account issued b y such
institution."
This proposed change was covered in FSLIC
Bulletin No. 36, published in the December 1946
REVIEW.
Monthly Survey
in the December 1946 REVIEW:
"Sec. 203.22 Sales Commissions on Shares.
No sales
commission shall be paid by any Federal association
to any of its officers or directors for t h e sale of its
shares.''
FHLBA
Bulletin N o . 85
Amendment to Rules and Regulations for the Federal Savings
and Loan System relating to hearings in connection with removal
of members from the Bank System.
The Federal Home Loan Bank Administration
adopted an amendment to Section 3.7 (Title 24,
Code of Federal Regulations) by substituting the
following new paragraph (c):
11
Procedure for Removal.
Adjudications p u r s u a n t to
Section 6 (i) of t h e Federal H o m e Loan Bank Act,
in connection with the removal of B a n k members,
will be determined in accordance with, a n d follow
t h e requirements of, t h e provisions of t h e Administ r a t i v e Procedure Act, as now or hereafter amended.
All such hearings are determined u n d e r the provisions of t h e Administrative Procedure Act t o be of
such a character t h a t either t h e filing or publication
of notice of any such hearing would be in conflict
with t h e public interest since t h e y involve t h e operations of financial i n s t i t u t i o n s . "
This amendment was proposed on December
20, 1946, and published in the January 1947
K E V I E W (page 114). I t was adopted on February
14 and became effective upon publication in
The Federal Register on February 19, 1947.
FSLIC
Bulletin N o . 37
Amendment to Rules and Regulations for Insurance of
Accounts relating to collection and payment of sales commissions.
(Adopted January 27, 1947; effective upon
filing with The Federal Register on January 30,
1947.)
164
(Continued from p. 157)
Insured savings accounts
were up $136 million
The net gain in savings accounts of all insured
associations during December was almost $136
million—more than twice the November gain.
While the increase was largely seasonal, it was
$27 million larger than in the same 1945 month.
Funds invested in savings accounts insured by the
FSLIC totaled $6.2 billion at the end of the year.
Total assets of the 2,496 insured associations
amounted to $7,319,000,000 on December 31.
Comparable 1945 figures were: 2,475 institutions
with resources of $6,148,000,000. [TABLE 13.]
Increase in share capital
followed seasonal pattern
As is always the case in December, withdrawal,
of funds from savings and loan associations were
lower than in the previous month in anticipation
of semi-annual dividend declarations which are
made by most associations at the year-end.
With the assistance of these year-end dividend
credits, total new share investments increased
seasonally in December 1946, totaling approximately $273,000,000. This was accompanied by
$113,000,000 of withdrawals. The net growth in
share capital of all savings and loan associations
during the month was estimated at $160,000,000—
the largest dollar increase yet recorded in one
month by these institutions. Both new investments and withdrawals were roughly one-fifth
above December 1945 totals and the repurchase
ratio was 41 percent compared with 42 percent.
[TABLE
14.]
Federal Home Loan Bank Review
BRANCH CITIES
OFFICERS OF FEDERAL HOME LOAN BANKS
BOSTON
B. J. ROTHWELL, Chairman; E. H. WEEKS, Vice Chairman; W. H . N E A V E S ,
President; H. N. FAULKNER, Vice President and Assistant Treasurer; L. E .
DONOVAN, Secretary-Treasurer; BEATRICE E. HOLLAND, Assistant Secretary;
INDIANAPOLIS
H. B. WELLS, Chairman; FERMOR S. CANNON, Vice Chairman and Vice
President; FRED T . GREENE, President-Secretary; G. E . OHMART, Vice
President-Treasurer; SYLVIA F. BROWN, Assistant Secretary; CAROLINE F .
PHILIP A. HENDRICK, Counsel.
W H I T E , Assistant Treasurer; HAMMOND, BUSCHMANN & ROLL, Counsel.
NEW YORK
GEORGE MACDONALD, Chairman; FRANCIS V. D . LLOYD, Vice Chairman;
NUGENT FALLON, President; ROBERT G. CLARKSON, Senior Vice President;
DENTON C. LYON, Vice President and Secretary; HAROLD B . DIFFENDERFER,
Vice President and Treasurer; JOSEPH F . X. O'SULLIVAN, Assistant Secretary
and Office Attorney.
PITTSBURGH
E . T . TRIGG, Chairman; C. S. TIPPETTS, Vice Chairman; RALPH H . RICHARDS, President; G. R. PARKER, Vice President-Secretary; D A L E P A R K ,
Treasurer; WILLIAM S. BENDER, Counsel.
WINSTON-SALEM
H. S. H AWORTH, Chairman; E. C. BALTZ, Vice Chairman; O. K. LAROQUE,
President-Secretary; Jos. W. HOLT, Vice President-Treasurer; SPRUILL
THORNTON, Counsel.
CINCINNATI
HOWARD L. BEVIS, Chairman; W. MEGRUE BROCK, Vice Chairman; W. D .
SHULTZ, President; W. E. JULIUS, Vice President-Treasurer; J. W. WHITTAKER, Vice President; E . T . BERRY,
Secretary; TAFT,
STETTINIUS &
HOLLISTER, Counsel.
CHICAGO
C. E. BROUGHTON, Chairman; H. G. ZANDER, J R . , Vice Chairman; A. R .
GARDNER, President; J. P . DOMEIER, Vice President and Treasurer; CONSTANCE M . WRIGHT,
Secretary; LAURETTA
QUAM,
Assistant Treasurer;
GERARD M . UNGARO, Counsel.
D E S MOINES
ROBERT E. L E E HILL, Chairman; R. J. RICHARDSON, President and Secretary; W. H . LOHMAN, Vice President and TREASURER; A. E. MUELLER,
Assistant Treasurer; J. M. MARTIN, Assistant Secretary; ROBERT H. BUSH,
Counsel.
LITTLE ROCK
B. H. WOOTEN, Chairman; W. P . GULLEY, Vice Chairman; H. D. WALLACE,
President-Secretary; J. C. CONWAY, Vice President; W. F . TARVIN,
Treasurer.
TOPEKA
W M . M. JARDINE, Chairman; HENRY A. BUBB, Vice Chairman; O. A.
STERLING, President and Secretary; R. H . BURTON, Vice President and
Treasurer; JOHN S. DEAN, Counsel.
SAN FRANCISCO
B E N A. PERHAM, Chairman; W M . A. DAVIS, Vice Chairman; GERBIT
VANDER
ENDE,
President;
G U Y E . JAQUES,
Vice President;
IRVING
BOGARDUS, Vice President and Treasurer, Manager of Portland Branch;
A. C. NEWELL, Vice President, Manager of Los Angeles Branch; E . M.
JENNESS, Assistant Secretary; E . E . PEARSON, Assistant Secretary; KATHLEEN MCCLIMENT, Assistant Secretary; L. F . NOLAN, Assistant Treasurer;
G. H. MELANDER, Assistant Treasurer; VERNE DUSENBERY, Counsel.
0. S. GOVERNMENT FR1NTIN« OFFICE: 1947
@FedFRASER