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FEDERAL
HOME
LOAN
BANK
Vol. II, No. 10
Washington, D. C.
JULY 1945
FEDERAL HOME LOAN BANK
Contents
A N A L Y S I S OF S A V I N G S A N D L O A N TRENDS IN THE
NEW YORK DISTRICT
By Robert G. Clarkson, Vice President, FHL Bank of New
York
Vol.11
2
No. 10
P
°S
27'
C O N D I T I O N O F MEMBER ASSOCIATIONS
An examination of changes in balance sheet items
28
THRIFT A N D REAL ESTATE OPERATIONS O F BANKS
A study of trends during 1944
JULY 1945
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.
Each issue is written for executives of
thrift and home financing institutions,
especially those whose organizations are
insured by the Federal Savings and
Loan Insurance Corporation and are
members of the Federal Home Loan
Bank System.
Communications
concerning
28
THE UPWARD TREND IN L O A N A M O U N T S
A n analysis of the size of average mortgage recordings,
1939-1944
29
STATISTICAL D A T A
New family-dwelling units
Building costs
Savings and loan lending
Mortgage recordings
Sales of U. S. war savings bonds
F H A activity
Federal Home Loan Banks
Insured savings and loan associations
302-30
303-30
304-30
305-30
30
30
30
30
REGULAR DEPARTMENTS
Home Front
Monthly Survey
Directory Changes of Member, Federal, and Insured Institutions
Worth Repeating
29
29
30
30
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,
Contents of this publication are not copyrighted and
may be printed freely
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.
278
SUBSCRIPTION PRICE OF REVIEW.—A copy of the REVIEW is sent to each member and
sured institution without charge. To others the annual subscription price, which covers the c(
of paper and printing, is $1. Single copies will be sold at 10 cents. Outside of the United Stat
Canada, Mexico and the insular possessions, subscription price is $1.60; single copies, 15 cen
Subscriptions and orders for individual copies should be sent with remittances to the Superintend
of Documents, Government Printing Office, Washington 25, D. C.
APPROVED BY THE BUREAU OF THE BUDGE
Federal Home Loan Bank Re
ANALYSIS OF SAVINGS AND LOAN TRENDS IN
THE NEW YORK DISTRICT
Trends in the operating statements and balance sheets of members in
the New York Federal Home Loan Bank District are of general interest
in that they reveal the effects of vigorous competition upon the
savings and loan industry. The following analysis traces the more
significant developments in operating ratios and balance sheet items.
By R O B E R T G. CLARKSON, Vice President
Federal Home Loan Bank oj New York
•
MOST annual reports of member savings a ad
loan associations for 1943 and 1944 indicate a
downward tendency in the ratio of gross operating
income to average assets. Reports received so far
in 1945 indicate that the operating income ratio can
be expected to decline again this year.
This trend prompted the Federal Home Loan
Bank of New York to conduct a study of the last six
years' operations of a representative group of its
savings and loan association members. Findings
are summarized in Chart A—" Consolidated Comparative Analysis of Operations."
The study emphasizes an earning problem already
recognized by competent managements. The problem apparently is of nationwide importance and
the New York Bank's study may be useful as a
guide to all associations in estimating their earning
capacity under prevailing conditions.
The Bank feels that the survey has produced an
accurate cross section of some of the operating problems facing member institutions at this time, which
problems may be expected to continue in greater or
lesser intensity for some time to come.
Method of Conducting Study
The individual savings and loan association members and the New York Bank joined in the preparation of the statistics needed.
As a first step, the New York Bank prepared a
form, "Comparative Analysis of Operations," and
mailed it in duplicate to members with a request
that one completed copy be forwarded to the Bank
and the suggestion that the other copy be submitted
to the association's directors early in the current
operating period. The form follows the layout of
Chart A. All of the data for completing the form
were readily obtained by the associations from their
file copies of the standard annual report made to the
Bank.
July 1945
Responses were received by the Bank from 75 of
its members having 41 percent of the total savings
and loan member assets in the New York District.
In sending the completed comparative analysis reports to the Bank, a number of the members stated
that the extra copy of the form which was furnished
for their files was being duplicated for distribution
to their directors as a basis for considering future
reserve and dividend policies. Some members considered the study so worthwhile that they recommended it be continued each annual period.
The individual analyses were consolidated by the
Bank and copies of the Consolidated Comparative
Analysis—Chart A—were furnished to all interested
associations together with consolidations by five different size groups of associations. The different size
groups produced some slight variations in the percentage ratios, but the general trends in all groups
are identical with those in the consolidated analysis.
Analysis of Operating Trends
The important and, in some instances, revolutionary changes within the last six years in the balance sheets of savings and loan association members
of the New York Bank are set out in Chart B.
The corresponding balance sheet items of the specific group of associations reported in Chart A are
included in the total reported for all associations in
Chart B. I t is fair to assume that the comparative
ratios reported for all associations apply uniformly
to the specific group.
The earning ability of associations has been influenced by these changes and the experiences of the
four years before 1943 are especially suitable for
comparisons with trends since that time because
the years 1939-1942 represent a period of more or
less stabilization. To a considerable extent, the
operations of those years reflect full recovery from
the serious economic upset of the early 1930's. Also,
these same years precede the period reflecting the
serious influence of war conditions on operating
income.
279
Between 1939 and 1942, the ratio of gross
operating income to average assets remained around
4.5 percent for the group of associations reported in
Chart A. The maximum variation in these four
years was only 0.12 percent despite certain significant changes in the balance sheet structure which
could be expected to affect income.
The proportion of mortgage assets to total assets
of all savings and loan association members of the
New York Bank gained in each of the four years
until they reached a peak of 78.1 percent in 1942.
However, this did not result in a proportionate increase each year in revenue from mortgage investments. Such income in total remained fairly constant
because most of the new mortgages were made at
lower rates of interest than were received on mortgages repaid or matured during the same period.
Also, income formerly received from premiums and
other charges commonly associated with the origination of loans, gradually disappeared as the
competition for mortgage business increased.
The holdings of low-yield Government bonds increased rapidly in each of these four years, and
during the same period real estate dropped to a
point where, at the end of 1942, it no longer seriously
influenced earnings.
Thus, by coincidence, the asset shifts during these
four years developed offsetting factors which resulted in a similar rate of income for all periods.
However, as the changes in the balance sheet structure became more pronounced in 1943 and 1944, they
finally started to seriously influence earnings.
Construction of homes dropped off sharply after
1942 and other types of desirable mortgage invest-
ments were not available in sufficient volume to
absorb the ever increasing amounts of capital funds
received by savings and loan associations from the
general public.
Employment in war industries at high wages encouraged borrowers to repay old mortgages in substantial volume in cooperation with the Government's
express wish to have individuals reduce personal indebtedness as a brake on inflationary trends.
Under such circumstances, the ratio of mortgage
loans to total assets dropped from the peak of 78.1
percent in 1942 to 67.8 percent at the end of 1944.
The ratios of net income to average assets and
average capital follow the pattern of the gross operating income ratio for the four years ending in
1942 and reflect a reasonable degree of stability.
Again, like the gross income ratio, the net income
ratio moved downward rapidly in 1943 and 1944.
The rapid expansion of assets, contraction in earning capacity, and increased operating costs have
combined to create a serious problem in the proper
distribution of reduced net income.
By gradually adjusting dividend rates downward,
many associations were able to increase the proportion of net income transferred to reserves and undivided profits in each of the four years before 1943.
During this time it was expected that such transfers
would result in higher reserve ratios and it is true
that the average ratio of reserves and undivided
profits to net assets increased from 5.04 percent in
1939 to a peak of 5.86 percent in 1942. This percentage increase is rather nominal and, to some
extent, is accounted for by the unusually rapid
growth in assets during the same period.
Federal Home Loan Bank of New York
Chart A—Consolidated comparative analysis of operations of a representative group of reporting
member institutions
1943
Year
N u m b e r of r e p o r t i n g i n s t i t u t i o n s
1942
1940
71
68
63
$287, 239, 447
269,141, 555
242, 086, 323
11,072,434
4.09
$244, 521,050
234, 813, 441
210,179, 041
10,035, 558
4.27
$220, 815, 404
214,172,135
193,058,106
9, 796. 237
4.57
$209, 437, 312
202,895, 572
181, 884, 583
$192,171,603
186, 767,008
168,875,169
8, 445, 383
4.52
$178, 877, 447
173, 412, 572
159,044,110
7, 829, 824
4.52
O p e r a t i n g expenses
% Average assets
% Gross o p e r a t i n g i n c o m e
$3, 483,155
1.29
31.60
$3,032,038
1.27
30.30
$2, 843, 524
1.33
29.00
$2, 569, 079
1.27
28.50
$2, 297, 417
1.23
27.10
$2,069,511
1.19
26.30
N e t income
% Average assets
% Average c a p i t a l
% Transferred t o reserves a n d u n d i v i d e d profits
$7, 727,034
2.87
3.19
30.85
$7,072, 556
3.01
3.35
34.05
$6, 673,044
3.11
3.46
34.67
$6, 390, 877
3.16
3.52
31.98
$6,002,018
3.23
3.57
28.22
$5, 604, 262
3.24
3.53
23.15
2.33
$16, 518, 214
5.75
2.43
$14, 229, 019
5.82
2.57
$12, 927, 456
5.86
2.68
$10, 929, 581
5.22
2.79
$9, 902, 566
5.16
2.92
$8, 976,068
5.04
N e t assets—end of y e a r
Average assets for y e a r
Average c a p i t a l for y e a r
Gross o p e r a t i n g i n c o m e
% A v e r a g e assets
D ividend rate
Reserves a n d u n d i v i d e d profits
% N e t assets
280
Federal Home Loan Bank Review
A rather general reluctance to face squarely the
dividend question precipitated by reduced income
in the last two years has resulted in a lesser portion of
net income being available for transfer to reserves and
undivided profits. It is not surprising, therefore, to
note that transfers have not been sufficient to maintain the rather modest average reserve ratio of 5.86
percent reached in 1942, and by 1944 this ratio had
dropped to 5.75 percent.
The reserve ratio takes on added importance for
associations currently active in making mortgage
loans. Due to accelerated repayment of the older
and well seasoned loans, the mortgage portfolios in
these instances develop an unusually high average
ratio of unpaid balance of loans to original amount.
In many cases it has been observed to be as high as
90 percent, while under normal circumstances it
would be somewhere in the neighborhood of 75
percent.
Considering also that loans are being made in an
inflated real estate market and with evidence that
association appraisals are to some extent following
the market, the importance of building and maintaining strong reserves becomes paramount. There
is clear evidence, in many cases, that current dividend rates cannot be maintained in face of existing
trends without weakening the reserve structure.
Future O u t l o o k
Results of operations for the last two years are important guideposts and stimulate a full study of all
factors affecting operating income and the general
stability of associations, not only for the immediate
future, but for some time ahead into the postwar
period.
Until reconversion trends are clearly defined,
associations undoubtedly will continue to maintain
the liquidity average of the present—approximately
30 percent of assets in cash and Government
securities.
In recent years, associations have generally accepted shareholder requests for withdrawal of funds
on a demand basis. While associations have not
promised to pay on demand, this practice has registered very deeply with the general public and is
responsible to a considerable extent for the increasing
flow of capital into associations. Thus, savings and
loan associations face a greater need for a generally
higher level of liquidity for operation during normal
periods.
Another situation immediately affecting earning
capacity is revealed in the 1943 and 1944 figures.
Although the dollar amounts of mortgage loans increased in each of these years, their percentages to
total assets decreased. This trend can be expected
to continue until a substantial volume of new construction is developed. Quality construction on a
large scale depends upon an even flow of all essential
materials into the housing market.
Improvised materials and techniques, applied to
overcome scarcities, not only slow up construction
volume but tend to increase costs and limit the
market for the resulting housing. Full-scale construction that will produce a first-class product can
hardly be expected to get under way until late in
1946. In the meantime, associations should be content to expand their investments in Government
securities rather than reach for marginal loans on
existing old construction in an inflated real estate
market.
Federal H o m e L o a n Bank of N e w Y o r k
Chart 8.—Selected b a l a n c e sheet items a n d ratios of a l l savings a n d loan association members
Date
D e c . 31, 1944
D e c . 31, 1943
D e c . 31, 1942 D e c . 31, 1941 D e c . 31, 1940
D e c . 31, 1939
401
N u m b e r of savings a n d loan m e m b e r s
$673,186,991
.73, 339, 276
$520,920, 587
$485,100,000
$463,894,000
$449,542,000
41, 530,960
131,188, 526
25.6
41,526,923
65,576,211
18.7
30,808,528
20,186,874
9.8
29, 981,000
6,412,000
7.5
22, 517,000
3,168,000
5.5
20, 644,000
2,856,000
5.2
$456,140,593
67.8
$418, 273, 441
73.1
$406,077,064
78.1
$376, 959,000
77.5
$342, 564,000
74.0
$322, 487,000
71.8
Borrowed money
% Borrowed m o n e y to assets
$18, 660, 583
2.8
$18,619,978
3.2
$25,638, 530
4.9
$30,371,000
6.3
$24,990,000
5.4
$25,039,000
5.6
Reserves a n d u n d i v i d e d profits
% Reserves a n d u n d i v i d e d profits to assets
$41, 479,153
6.1
$40,466,836
7.1
$39, 506, 779
7.6
$34, 532,000
7.1
$38,037,000
8.2
$38,462,000
8.6
$8,937,051
1.3
$15, 651, 671
2.7
$29, 521, 572
5.7
$37,093,000
7.6
$62,625,000
13.5
$72,128,000
16.1
TOTAL ASSETS
Cash
G o v e r n m e n t securities
% C a s h a n d G o v e r n m e n t s to assets
M o r t g a g e loans
% M o r t g a g e loans to assets
R e a l estate o w n e d
% R e a l estate to assets
July 1945
281
The problem is further complicated by the unprecedented flow of share capital into associations,
and until this abates or new construction resumes
on a substantial basis, associations will probably
continue to expand the ratio of Government securities and cash beyond the present average of approximately 30 percent.
Some letup in the inflow of savings may be expected during the reconversion period. There is
some evidence that the partial reconversion period
we are now in may, in the near future, slow up the
inflow of new money. Any breakdown or major dislocation of the rather finely balanced national machinery to stabilize the country's economy during
the reconversion period could readily result in demands upon member institutions which probably
would absorb present liquid assets quickly. Thus,
earnings must continue to be sacrificed for liquidity.
The increase in the operating expense ratio is of
major importance to management and yet is
one of the most difficult things to reduce in
a financial institution.
Legitimate overhead is
necessary to maintain sound operations during
periods of comparative inactivity and low productivity. To suggest reductions in personnel and in
salaries is seldom a constructive approach and may
indeed result in a completely penny-wise, poundfoolish operation. Some minor savings may be
worked out in some of the expense items, but by and
large the cost of doing business is dictated by features
of the business which do not vary materially from
year to year.
Interest Rates
The mortgage lending field has suffered a downward trend in interest rates on mortgage loans since
the recovery period after the serious real estate
upset in the early 1930's. Not only have interest
rates been reduced, but all of the other frills, including premium charges, which resulted in additional income to mortgage lenders, have been pretty
much eliminated by institutions active in today's
competitive mortgage field.
Keductions in interest rates are due to some extent
to Government activities in the housing field. These
activities are partly responsible for attracting large
aggregations of capital into the mortgage market
from institutions that previously had only a limited
interest in mortgage investments. The resulting
increase in the supply of mortgage money, plus
Government influence, has continued to push interest rates downward.
282
Important nationwide influences concerned with
social reform have been pressing and will continue
to press for lower cost housing and lower monthly
carrying charges. Interest costs have responded to
such pressure. The GI Bill, with its provision for
4-percent mortgages, has set the stage for further
reductions in interest rates on prime home lending
risks.
Refinements and safeguards, such as scientific
appraisals, complete credit information on borrowers,
definite term monthly direct reduction mortgages,
inclusion of taxes in the monthly mortgage payment,
improved loan servicing, insurance of mortgages by
FHA, and life insurance in connection with mortgages, all have a tendency to reduce the potential
risk in the mortgage business and make it possible
for more and more capital to approach the field and
work on a lower gross income.
Long and Short Term Factors
These many elements are of a permanent nature
and will have a particular influence upon the longrange earning prospects of savings and loan associations. In addition, there are certain other elements currently affecting the yield from mortgage
business which may continue for sometime into the
future, at least until there is sufficient construction
of new dwellings to absorb the excessive supply of
mortgage money now available. These elements
include the willingness of the associations to absorb
loan charges, to pay brokerage fees for loans, and in
instances where they purchase mortgages rather than
originate them, the willingness to pay a premium for
FHA insured loans and for uninsured loans which are
considered prime risks.
A completely realistic understanding of the limits
upon earning capacity in the years immediately ahead
is essential in the establishment of any sound dividend or reserve policy. A financial institution can
be expected to survive a troublesome period in direct
ratio to the strength of its reserves and its liquidity.
A serious weakness in either can be fatal, and they
are interrelated.
The public cannot be expected to stand by and
support savings and loans if mistakes of the 1920's
and 1930's are duplicated. There is no valid reason
why they need be duplicated if the trends, which are
so clearly revealed, are used as a basis for establishing
reserve, dividend and liquidity policies that will
withstand not only sudden and momentary shocks,
but the intensified and sustained shocks of a major
depression.
Federal Home Loan Bank Review
CONDITION OF MEMBER ASSOCIATIONS
The large inflow of new savings in 1944 resulted in the expansion of
liquid assets to record proportions. Despite the high volume of lending,
portfolios showed only a moderate dollar gain.
•
T H E changes which have occurred since the end
of 1939 in the volume and composition of the
combined resources of member savings and loan
associations are illustrative of the interrelationship
of all sectors of our national economy. From the
year-end statements of member institutions of the
Federal Home Loan Bank System there may be seen
a story of mushroom-like growth in individual earnings which poured into new savings and accelerated
debt retirement. These factors, coupled with curtailed building and increasing competition in the
mortgage market, in turn contributed to the rapid
growth in liquid assets which expanded to unprecedented proportions—from approximately one-sixteenth of Bank member resources in 1939 to more
than one-fourth by the end of 1944. Thus, the
period has witnessed an upward movement in invested savings which the mortgage portfolio was
unable to pace despite the growing volume of lending
throughout the past two years. The same forces
which were generating the inflow of new money into
savings accounts were likewise contributing to the
more rapid repayment of loans already carried on the
books.
Managers might well inquire as to what extent
these trends might be expected to be reversed when
the war is over. When munitions production ceases
and a number of war workers must live on their accumulated savings until they find peacetime jobs, will
there be a significant shrinkage in thrift account
balances? If associations are confronted with declining savings and increased mortgage lending
opportunities, will their liquid assets be sufficient to
meet, alike, repurchase requirements and the demand
for mortgage money? Will they be able to retain a
higher liquid ratio than before the war? For the
present, answers to these questions are indefinite and
qualified, since the final test must lie with the performance of the economy and the industry. However, the latest combined statement of condition for
member associations will assist in placing such forecasting on an informed basis.
Resources of member associations showed another
marked rise in 1944, and amounted to $6,423,000,000
at the end of that year—16 percent above the total
July 194S
reported 12 months earlier and about 59 percent
higher than at the end of 1939. This represents an
increase in the size of the average member association from $1,497,000 at the end of 1943 to $1,757,000
at the close of last year.
Since the end of 1939, total resources have shown
a rise of $2,375,000,000. This expansion which has
taken place during the period of preparation for and
prosecution of the war is the result of a net gain of
$2,266,000,000 in public and private investments
and an increase of $168,000,000 in reserves, permanent capital, undivided profits and deferred items,
offset by a net decline of $60,000,000 in non-savings
liabilities ( i n c l u d i n g m o r t g a g e pledged shares).
Throughout these years, Government shares have
been retired at a rate well in advance of legal requirements, while the large inflow of private capital
amply over-compensated such withdrawals.
For the single year 1944, the gain in assets totaled
$884,000,000 and was composed of increases in all
three groups on the credit side of the sheet. Investments (public and private) showed a net rise of
$778,000,000; other liability items, including mortgage pledged shares, were $56,000,000 higher than
they had been at the end of 1943; and capital items
grew by $49,000,000 during 1944. That the change
in non-savings liabilities showed an increase for the
year whereas the general trend in the two preceding
283
Combined statement of condition (or all savings and loan members
NOTE:
alance sheet item
Number o f menbers
Percentage figures show the r a t k
Combined
Pittsburgh
Winston-Salem
3,656
ASStTS
F i r s t mortgage l o a n s (include n , i n t e r e s t and a d v a n c e s ) O t h e r l o a n s ( i n c l u d i n g s h a r e loans)
Heal e s t a t e s o l d on c o n t r a c t
Ueal e s t a t e owned
F e d e r a l Home Loan Pan'f S t o c ^
U»So Government o b l i g a t i o n s
Other investments
(including accrued i n t e r ^ s t ) -
Cash on hand and i n banVs
O f f i c e b i n l d i n , , , (net)
F u r n i t u r e , f i x t u r e s , and equipment
(net)
Other assets
Total
assets-
$4 ,273,720,534
66.54%
: 501,806,748
72.78%
$459,425,379
07.71%
$292,974,935
75.54%
$527,024,505
70.57%
12,001,853
0.19%
116,747,144
1.82TS
3G,82G,91G
0.57%
G2,250,802
0.97%
,490,747,457
23.21%
22,975,090
0.3G%
347,347,932
5.41%
47,807,305
0.74%
4,890,599
0.08%
7,445,520
0oll%
2\ 2 6 2 , 0 5 8
0.33%
308,158
0.04%
2,913,778
0.42%
5,646,065 v
0.82%
133,975,924
19.43%
2,549,038
0.37%
34,193,890
4.96%
3,022,230
0o44%
520,504
0*07%
2,332,582
0.34%
1,405,069
0.21%
8,742,118
1.29%
9,550,019
1.41%
6,390,800
0.94%
142,327,219
20.97%
4,955,219
0.73%
39,508,510
5.82%
4,096,930
0.69%
809,851
0.12%
746,087
0.11%
1,818,108
0.46%
4,102,867
1.06%
2,702,160
0.70%
3,899,300
1.01%
56,662,507
14.61%
186,971
0.05%
22,214,805
5.73%
2,289,209
0.59%
307,976
0.09%
006,848
0.10%
1,500,112
0.20%
1,543,870
0.21%
1,313,797
0.17%
6,218,500
0.83%
169,650,103
22.72%
1,208,077
0.16%
33,174,063
4.44%
4,317,532
0.58%
423,659
0.00%
400,258
0.06%
$6. 4 2 2 , 7 6 1 , 8 1 2
100.00%
$089,591,581
100.00%
$678,557,201
100.00%
$ 387,825,686
100,00%
$746,840,482
100.00%
LIABILITIES ANC CAPITAL
U . S . Government i n v e s t m e n t (sliares and d e p o s i t s ) —
P r i v a t e repurchasable capital
Mortgage-p] edged s l i a r e s
Advances from Federal Home Loan P-anVs
O t h e r borrowed money
Loans i n p r o c e s s
Advance payments by b o r r o w e r s
Other l i a b i l i t i e s
Permanent r e s e r v e o r g u a r a n t y stocV
Deferred c r e d i t s to future operations
Sped f l c Reserves
General r e s e r v e s
Undivided p r o f i t s —
T o t a l l i a b i l i t i e s and c a p i t a l
284
35,528,850
0.55%
,500,971,987
85.05%
103,445,564
1.61%
126,882,373
1.97%
63,526,770
0.99%
35,134,189
0.55%
30,109,345
0.48%
22,109,587
0.34%
25,935,970
0.40%
10,311,012
0.10%
7,543,522
0.12%
313,609,698
4.88%
147,592,945
2.30%
:
75,127
0.01%
166,680
0.03%
29,116,982
4.22%
18,600,001
2.70%
1,043,384
0.15%
952,313
0.14%
27,147,124
4.00%
17,404,768
2.57%
436,800
0.11%
323,219,091
83.34%
14,579,933
3.76%
12,930,629
3.34%
1,140,950
0.29%
1,023,661
0.42
2,550,213
0.66%
1,634,793
0.43%
46,183
0.01%
315,361
.0.08%
934,505
0.24%
22,884,447
5.90%
5,523,120
1.42%
1,422,701,812
100 0 00??,
$689,591,581
100.00%
$078,557,201
100.00%
$387,825,680
100.00%
932,100
0.14%
570,35r,,314
83.58%
39,814,762
5.77%
6,298,195
0.91%
11,383,500
1.65%
1,089,279
0.16%
4,007,875
0.58%
1,751,760
0.25%
$
9,901,500
1.47%
579^039,092
85.33%
14,345,670
2.12%
12,020,406
1.77%
10,257,160
1.51%
1,504,375
0.22/o
3,129,014
0.46%
1,692,383
0.26%
$
2,278,800
0.31%
648,454,908
80.83%
11,102,108
1.49%
9,681,213
1.30%
13,394,050
1.79%
2,754,804
0.37%
2,088,309
0.28%
2,493,074
0.33%
7,317
0.00%
802,043
0.11%
804,997
0.11%
33,933,310
4.54$
18,984,949
2.54%
$746,840,482
100.00%
Federal Home Loan Bank Reviev,
of the Federal Home Loan Bank System, December 3 1 , 1944
of the items listed to total assets.
Indianapolis
Chicago
550
221
454
$740,687,000
61.39$
744,507
0.06%
11,525,641
0.96%
8,102,023
0.G7%
10,628,900
0.88%
342,819,041
28.41%
4,272,141
0.36%
72,315,335
5.99%
14,279,791
1.18%
441,325
0.04%
719,007
0.06%
$231,286,490
54.89%
717,179
0.17%
30,609,249
7.27°%
1,244,025
0.30%
7,007,000
1.66%
122,329,224
29.03%
741,591
0.18%
21,874,518
5.19%
4.^97,102
1.1G%
337,038
- 0.08%
284,305
0.07%
$1,206,535,917
100.00%
$
Cincinnati
Des Moines
235
. L i t t l e Rock
Topeka
269
207
Los Angeles
Portland
166
127
$413,932,049
00.84%
1,004,792
0.10%
28,372,435
4.58%
5,184,460
0.84%
0,809,217
1.10%
120,040,368
19.39%
2,014,799
0.42%
37,417,580
0.04%
2,045,737
0.43%
576,042
0.09%
670,089
0.11%
$233,021,877
00.35%
485,915
. 0.14%
5,478,758
1.50%
1,576,842
0.45%
4,282,700
1.22%
85,524,693
24.35%
1,251,206
0.30%
17,493,827
4.98
1,492,233
0.42%
202,213
0.06%
394,552
0.11%
$218,303,450
75.39%
853,322
0.30%
1,607,870
0.56%
895,411
0.31%
2,532,100
0.87%
47,379,559
16.30%
1,737,020
0.60%
13,907,209
4.80%
1,627,630
0.56%
197,831
O.OTfo
523,611
0.18%
$155,405,543
08.20%
245,997
0.11%
7,566,967
3.32%
1,607,753
0.71%
2,314,300
1.02%
47,495,945
20.84%
498,659
0.22%
9,741,727
4.27%
2,570,969
1.13%
270,794
0.12%
140,303
0.00%
$138,120,331
49.00%
380,804
0.14%
14,240,329
5.11%
270,058
0.10%
1,800,480
0.07%
102,748,323
30.90%
2,232,580
0.80%
15,914,730
5.72%
2,200,108
0.81%
312,297
0.11%
120,120
0.04%
$361,665,021
08.80%.
571,390
0.11%
2,048,870
0.50%
1,465,984
0.28%
4,001,500
0,89%
119,787,951
22.79%
727,777
0.14%
29,591,GOG
5.03%
3,707,774
0.70%
431,009
$421,327,781
100.00%
$019,274,780
100.00%
$351,204,810
100.00%
$289,565,679
100.00%
$227,859,017
100.00%
$ 278,472,766
100.00%
$525,700,100
100.00%
3,652,950
0.30%
1,056,265,581
87.55%
10,655,698
0.88%
7,766,963
0.04%
3,278,985
0.27%
3,938,114
0.33%
4,411,161
0.37%
2,996,491
0.25%
15,393,234
1.28%
2,645,627
0.22%
951,143
0.08%
00,984,054
5.05%
33,595,910
2.78%
$
$
$
$
$
$1,200,535,917
100.00%
$421,327,781
100.00%
1,270,000
0.30%
368,634,750
87.49%
992,810
0.24%
10,098,782
2.40%
1,547,551
0.37%
1,033,121
0.39%
1,197,953
0.28%.
1,085,984
0.20%
00,009
0.01%
1,059,015
0.39%
800,755
0.19%
20,858,130
4.95%
11,488,912
2.73%
July 1945
R591Q1—d.R
v
3,091,000
0.50%
520,200,312
84.00%
5,794,099
0.94%
19,542,893
3.10%
3,145,810
0.51%
8,845,592
* 1.43%
0,397,245
1.03%
3,292,330
0.53%
1,093,045
0.27%
581,021
0.09%
37,092,238
0.09%
8,998,595
1,45%
$619,274,780
100.00%
502,400
0.16%
310,944,252
88.54%
2,153,986
0.61%
11,747,388
3.35%
3,050,500
1.04%
1,843,269
0.52%
852,759
0.24%
1,089,079
0.32%
17,100
0.00%
396,053
0.11%
454,503
0.13%
13,336,408
3.80%
4,157,119
1.18%
$351,204,816
100.00%
$
1,413,200
0.49%
244,327,344
' 84.38%
1,075,434
0,37%
5,790,131
2,00%
1,558,995
0.54%
1,837,608
0,63%
1,766,309
0.01%
2,568,725
0.88
675,700
0.23%
223,562
0,08%
398,556
0.14
21,500,880
7.45%
0,303,229
2.20%*
$289,565,079
100.00%
953,300
0,42%
190,885,135
8G.41%
1,559,407
0,08%
1,492,325
0.65%
2,315,987
1.02%
1,816,957
0,80%
1,550,952
0.68%
904,344
0,40%
666,563
0.29%
394,406
0,17%
380,933
0.17%
14,153,752
6.21
4,784,950
2.10$
$227,859,017
100.00%
3,805,800
1.37%
245,850,446
88.28%
446,633
0,16%
3,420,024
1.23%
4,130,495
1.48%
2,085,248
0.75%
998,912
0.30%
1,395,166
0.50%
1,109,873
0.40
413,319
0,15%
341,749
0.12%
10,625,252
3.82%
3,849,849
1.38% .
$278,472,766
100.00%
0.08%
440,498
0.08%
I
$
7,170,400
t.30%
430,795,750
81.95%
805,012
0.17%
20,093,424
4.96%
7,722,781
1.47%
G,IG2,101
1.17%
1,152,043
0.22%
1,205,452
0.24%
7,900,000
1.52%
049,470
0.12%
770,3G7
0.15%
21,311,109
4.05%
13,781,531
2.02%
$525,70G,10G
100.00%
285
9
years had been downward is due primarily to increased borrowing to facilitate operations during the
Sixth War Loan which closed at the end of 1944.
The gain in borrowings last year ($63,000,000) was
greater than the net increase in non-savings liabilities,
declines in mortgage pledged shares and loans in
process being the offsetting items in this group.
Asset Trends in 1944
First mortgage loans held by member associations
at the close of 1944 were reported at a combined
outstanding balance of $4,274,000,000, about 6 percent above the balance reported at the end of the
preceding year.
The virtual extinction of the real estate account
over recent years has progressively narrowed the
base from which additions are usually made to contract sales. This, together with the increasing ease
with which purchasers have been able to meet contractual payments on or in advance of schedule, resalted in a 17-percent drop in the amounts due en
contracts which totaled $117,000,000 at the end of
last December.
Taken as a group, total loans and contracts accounted for but 68.6 percent of the resources of member associations at the close of the year, as compared
with 75.9 percent at the end of 1943 and the postdepression peak for this ratio, 86.0 percent recorded
in 1941. In 1939 the ratio of loans and contracts to
resources was 81.4 percent.
All Bank Districts reported increases in the volume
of loans and contracts held by members, gains ranging from 11.2 percent and 9.2 percent in the Pittsburgh and Los Angeles regions, respectively, to 0.05
percent in Portland, while Indianapolis had an 0.90
ratio. The greatest advance in dollar amount was
in the New York area where members showed loans
and contracts $38,000,000, or 8.9 percent, in excess of
the balance indicated at the end of 1943. Members
of the Chicago Bank reported a gain of $33,000,000,
the second largest for the country, placing balances
Trends of selected balance sheet items in relation
to total assets
Item
First mortgage loans
Real estate owned
Real estate contracts
Cash a n d U. S. Government
obligations
GO*
1944
1943
Percent
66. 54
0. 57
h 82
Percent
73.08
1. 26
2. 55
28. 62
20. 33
1942
1941
Percent Percent
79. 39 81. 68
2. 48
3.95
3. 23
3. 62
11. 86
7.38
held by these institutions 8 percent higher than the
figure reported 12 months earlier.
In proportion to total assets, the Pittsburgh District showed the highest ratio for loans and contracts,
77 percent, followed by the Little Rock area with
76 percent. The lowest ratio was in the Portland
region, 55 percent. This compares with 1943
when members of the Pittsburgh Bank indicated a
high of 81 and the Portland District had the
lowest regional ratio, 68 percent. The downward
movement of this ratio was common to all areas.
Liquid assets (cash and IT. S. Government securities) continued to show the most marked change,
with an increase of $712,000,000 during the year
which advanced the total 63 percent to $1,838,000,000
on December 31. This placed the ratio of liquid
items to total resources at 29 percent. The Cincinnati Bank members indicated the greatest gain, $142,000,000, while the Winston-Salem region showed the
second largest dollar rise in liquid assets—$91,000,000.
The proportionate rise was the most pronounced in
the Los Angeles area—up 96 percent. This, however,
is in part due to the fact that the largest proportionate gain in savings was concentrated on the West
Coast.
As in 1943, the Portland and Cincinnati Districts
showed the highest and second highest ratio of liquid
assets to resources, 43 and 34 percent, respectively.
These compare with 29 percent and 26 percent reported 12 months earlier. Also, as in the preceding
year, the Pittsburgh region indicated the lowest ratio
of liquid to total assets, 20 percent in 1944 whereas
it had been 15 percent at the end of 1943.
The Government bond portfolio represented the
overwhelming bulk of liquid assets, constituting 23
percent of total resources of members for the country
as a whole. Members of the Portland Bank showed
the largest ratio of U. S. security holdings to assets,
37 percent.
Cash on hand and in banks, however, showed a
decline, the $347,000,000 held at the end of 1944
being more than 10 percent less than the figure indicated at the close of the preceding year. In relation
to total assets, this depressed the ratio from 7 percent to 5.4 percent. While the decline in this ratio
was common to all Bank Districts except Boston,
10 regions reported smaller cash items, with dollar
increases being shown only in the Boston and Los
Angeles regions ($4,656,000 and $351,000, respectively). The decrease in the cash item was primarily due to association activity during the Sixth
War Loan which took place at the end of 1944.
h&ri&rnl
rlr\m&
I r\nn
Rrtnlt
P^i/i^u/
Private Savings
On the credit side of the balance sheet the greatest
change occurred in savings account liability which
went up 17 percent from the figure shown at the
end of the previous year. This gain of $812,000,000
in private repurchasable capital carried the total
liability on savings to $5,500,000,000. The West
Coast showed the greatest proportionate growth in
private investments, with an increase of 25.2 percent in the Los Angeles area and a gain of 24.6
percent in the Portland region. Members of the
Cincinnati Bank had the largest dollar increase in
savings, a rise of $145,000,000 being recorded in
that region. Members in the New York area
ranked second with an increase of $105,000,000.
The ratio of private savings to total resources has
risen steadily since 1937 and at the end of last year
stood at 86 percent. The Des Moines and Portland areas had the highest and second highest, respectively, 89 and 88 percent. The Los Angeles
region had the lowest ratio, 82 percent.
U. S. Government investments in member associations declined by almost one-half during the year.
On December 31 they stood at $35,500,000.
Borrowed Money
The $63,000,000 net increase in borrowed money
that occurred during 1944 resulted primarily from
credit advanced from sources other than the Federal
Home Loan Banks. Borrowings from the 12 Banks
were $19,000,000 higher than at the end of the preceding year, while borrowings from other financial
institutions were $44,000,000 above the figure shown
12 months earlier. Of the $190,000,000 outstanding,
two-thirds represented advances from the Federal
Home Loan Banks.
I t will be recalled that money borrowed by member associations reached a peak of $239,000,000 in
1941 and that the balance owed to the Federal Home
Loan Banks and other sources of credit declined by
47 percent during the two subsequent years. Increased borrowing during the past year, principally
to finance the acquisition of Government securities,
carried the balance owed to 80 percent of the 1941
figure. However, at the end of last year, the ratio
of borrowed money to total resources was but 3
percent compared with 5 at the end of 1941.
Reserve Position
The phenomenal rate of asset growth in 1944
reversed the upward movement which had been
noticeable during the two preceding years in the
ratio of general reserves and undivided profits to
July 194S
Percentage distribution of balance sheet items for
all savings and loan members of the Federal
Home Loan Bank System, 1944 and 1943
Balance sheet item
All savings
a n d loan
members
N u m b e r of m e m b e r institutions
Federal
1944
1943
Percent
Percent
3, 701
Percent
Percent
Insured
state
Uninsured
state
1944 ] 1943
1,466!
Percent
Percent
Percent
Percent
ASSETS
F i r s t mortgage loans
Other loans
(including
share loans)
Real e s t a t e sold on contract
R e a l estate o w n e d
Federal Home Loan Bank
stock
U . S. G o v e r n m e n t obligations
O t h e r i n v e s t m e n t s (including accrued interest)
C a s h on h a n d a n d in
banks
Office b u i l d i n g (net)
F u r n i t u r e , fixtures a n d
e q u i p m e n t (net)
Other assets
T o t a l assets
66. 54 73.
65.13| 73. 42| 66.14 71.16 70.1
0.19
0.26
1.82
0.5'
2. 551 1.40|
1.261 0.41
0.14
0.17!
0. 15| 0.26
2.00
2.38
0.62
3.30
1.40|
0.82
0.97;
1.01
0.93
1.03
0.99
22.51 13.29
14.34
.0.36
2.76
1.93
2.01
0.87
1. 08]
23.21 13.34 25.61
74. 60
0. 35] 0.43
0.91
M
11.48
0.89
18.79
0.451
0.10
0.65]
0.84
5.41
0.741
6.99|
0.85
0.13
5.271 7.02|
0.73 0.82
5.66
0.77
7.6'(
0.881
0.08|
0.11
0.09
0.12
0. 55;
0.08
0.11
6. 16
5.39! 0.85
0. 75]
0. 101 0.04 0.06
0.11 0. 19] 0.19
100. 00 100. 00 100. 00 100.001 100. 00
100. 00
o.io|
0.08
0.11
0.091
LIABILITIES AND CAPITAL
IT. S. G o v e r n m e n t investment
P r i v a t e repurchasable capital
M o r t g a g e pledged s h a r e s . .
A d v a n c e s from Federal
Home Loan Bank
Other borrowed m o n e y
L o a n s i n process
Advance payments by
borrowers
Other liabilities
Permanent,
reserve or
g u a r a n t y stock
Deferred credits to future
operations
Specific reserves
General reserves
U n d i v i d e d profits
T o t a l liabilities a n d
capital
0.55
85.65 84. 66 87.26 86. 39 85.08 84.24 82. 79] 81.84
1.61 2.02J 0.10| 0. 17| 1.17
1. 151 5.51 6.55
1.97
0.99
0.55
1.95
0.34
0.48!
0.341
0.40|
0.46
0.16
0.12
4.88
2.30
0.23
0. 141
4.94
2.461
«PI
0.681
2.
1.44|
0.59
2.84
0.46]
0.83
1.77'
0.55
0.71,
1.66 0. 35] 0.57
0.22 0.56] 0.26
0. 86] 0.23 0. 19
0.47
0.401
0.45
0.33
0.48|
0.38
0.51
0.46
0.52
0.49
0.47
0. 24
0.40
0.32
1.21]
1.381
0.27
0.30
0.14
0. 12
3.80
2.04
0.20]
0. 14
3.76]
2.27
0.18'
0.12
5.66
2.19
0.23]
0. 14
5. 821
2.33
0. 19]
0. 101
6.28
3.01
0.27
0. 12
6.20
2.98
100. 00 100.00 100.00
resources. Last December, it amounted to 7.18
percent of assets as compared with 7.40 percent at
the end of 1943. However, despite wartime conditions in the mortgage market, allocations to these
accounts have been steadily increasing. In 1944
the net growth in reserves and undivided profits
amounted to $51,000^000, one-fifth more than the
net transfer of $42,000,000 made in the preceding
year. As a result, these items totaled $461,000,000
at the end of last December. Since 1939, general
reserves and undivided profits have increased by
$176,500,000, or 62 percent. In view of the possibility of a recession of private savings during the
period of reconversion which would be met by the
necessary contraction of liquid assets, it is likely
that there may be a rise in the ratio of reserves
to assets.
287
THRIFT AND REAL ESTATE OPERATIONS OF
BANKS DURING THE PAST YEAR
Annual reports of insured commercial and mutual savings banks
showed that these types of institutions followed generally similar
trends in their thrift and home financing operations last year. The
pattern, for the most part, was similar to that of the previous year.
M
T H E greatly expanded wartime earnings of the
general public and the abnormal real estate
situation were reflected in the 1944 thrift and home
financing operations of insured commercial and
mutual savings banks. Savings entrusted to these
institutions rose to unprecedented heights, increasing
at an even more rapid rate than during the previous
record year of 1943. A slackening occurred in the
decline of residential mortgage holdings, based on
number and volume of transactions involving existing properties. Finally, as further evidence of the
critically tight housing situation, the amount of
institutionally owned real estate declined to virtually
insignificant proportions.
Although the study is confined to insured commercial banks, based on annual reports of the Federal
Deposit Insurance Corporation, this group represents 94 percent of all operating commercial banks.
The insured institutions have 97 percent of total
industry assets and 98 percent of the time deposits
of individuals, partnerships, and corporations. 1
Their real estate loans represent 98 percent of the
total for all banks, while 80 percent of real e&tate
owned, other than bank premises, is in the hands of
insured commercials.
showed the greatest percentage increase—35 percent.
The fact that this area previously attained top rank
on the basis of two annual gains of approximately
30 and 18 percent, respectively, shows the vastly expanded scale of savings activity last year. Another
indication is that in 1944 and 1943, the smallest gain,
recorded both times by banks in the Pittsburgh
District, was 18 percent last year compared with
9 percent the year before.
On a dollar volume basis, insured commercial
banks in the Los Angeles region again led with an
increase of $829,000,000 compared with $564,000,000
in 1943. Topeka remained last in the increase
column—up $88,000,000 in 1944 and only $37,000,000
in 1943.
Increased savings activity was characteristic of all
states, with the exception of New Hampshire which
alone reported less of an advance in 1944 than in
PERCENTAGE CHANGE .IN RESIDENTIAL MORTGAGE
LOANS AND TIME DEPOSITS
INSURED COMMERCIAL
BANKS
1943 OVER 1942 AND 1944 OVER 1943
By Federal Home Loan Bonk District
RESIDENTIAL MORTGAGE LOANS
PER
-10
UNITED
TIME DEPOSITS
PERCENT
CENT
+ 10
+20
STATES
Savings in Commercial Banks
During 1944, insured commercial banks reported
a 26-percent gain in time deposits of individuals,
partnerships and corporations, bringing the volume
of savings to a new peak of $23,363,000,000. The
dollar amount of this increase—$4,791,000,000—was
well over one-and-a-half times as great as the 1943
record. In that year, an advance of $2,866,000,000
represented a gain of 18 percent over like deposits
during the preceding 12 months.
Insured commercial banks in all F H L B regions
shared in last year's unprecedented volume of savings.
For the third successive year, the Portland District
1
This classification is more comprehensive than the prewar breakdown of
"savings evidenced by passbooks." However, it has been found that by far the
greater part of this total represents individual savings.
288
Federal Home Loan Bank Review
1943. Florida remained the leader, percentagewise,
with a 46-percent advance last year compared with
38 percent the year before. The smallest increase
(13 percent) occurred in Delaware. Dollar gains
ranged from $805,000,000 in California to $8,000,000
in New Hampshire. Oklahoma, the only state to
show a decline in 1943, came back with a $14,000,000
advance last year.
Residential mortgage holdings and time deposits
of insured commercial banks, 1944
[Thousands of dollars]
U N I T E D STATES
Residential Mortgage Loans
Building restrictions continued to affect mortgage
lending operations of insured commercial banks
during 1944. However, activity in other than new
construction lending was sufficient to arrest the
previous year's decline in total holdings. At the
year-end they aggregated $3,157,000,000 after a decline of $47,000,000. Percentagewise, this decrease
was practically the same as in 1943 but the dollar
volume drop was considerably less than the $60,000000 decline of the previous year.
Last year only five regions, in contrast to six the
year before, were able to show improvement in their
residential mortgage portfolios. Gains, which were
again concentrated in the same middle western,
western and southwestern Districts (except for the
Indianapolis area) ranged from 0.5 percent in Chicago
to 9 percent in Des Moines. The 1943 variation
was between 0.6 in Little Rock and 29 percent in
Topeka. In dollar volume, Des Moines again had
the largest increase in 1944—up $19,000,000—while
Topeka was last in the increase column. In 1943
the increase in Des Moines was $18,000,000 with
Little Rock at the other end of the scale—up only
$310,000.
For the second consecutive year Los Angeles was
the only area west of the Mississippi to report a
decline—down $5,751,000, or 0.7 percent. California, predominant among the states of this
District, recorded an infinitely smaller drop last
year ($5,000,000) than was made in 1943 when
mortgage lending activity in that state was down
$31,000,000.
No specific breakdown of residential property
owned has been contained in the last three annual
reports of the Federal Deposit Insurance Corporation. However, during the last year the over-all
figure for "real estate owned other than bank
premises" dropped $59,000,000 and on December 31,
1944 stood at $64,000,000. There seems ample
reason to believe that residential real estate owned by
all insured commercial banks has dropped proportionately.
July 1945
Residential mortgage
loans
Federal H o m e Loan Bank
District and state
_ __
N o . 1—Boston
D e c . 31,
1944
__ __
$3,156,607
_ .
207, 984
.
1
Connecticut
M a i n e , _.
M a s s a c h u s e t t s . __ ___ .
New Hampshire Rhode Island
_. ___ !
Vermont
__ _ _ -
56,552
12, 797
79, 548 !
8,155
20,261
30, 671
T i m e deposits
Change
Dec. 31,
d u r i n g 1944 1
1944
-$46,980 $23,362,909
-3,964
+35
+157
-5,221
+257
+70
+738 1
Increase
during 1944
$4, 790, 503
1, 325, 386
228,429
284, 111
144, 464
587, 671
49,469
154, 456
105,215
46,089
22, 266
107, 071
7, 614
29,956
15, 433
N o . 2—New Y o r k
460,964
- 3 8 , 431
4,082, 554
717, 584
N e w Jersey _ _
N e w Y o r k __
218, 510
242,454
- 1 5 , 4 1 5 1 1,397, 773
- 2 3 , 016 1 2,684, 781
273,959
443, 625
No. 3—Pittsburgh .
311,386
-16,810
2,235, 387
342, 216
10,883
270, 551
29, 952
+265
-17,126
+51
45,328
2,018,011
172,048
5,293
299, 595
37,328
207, 422
- 2 , 742
1, 707, 293
355, 586
13, 654
32, 315
13, 702
25, 560
37, 819
15, 093
6,106
63,173
-923
- 3 , 071
+ 2 , 205
-1,149
+297
+481
-424
-158
176, 826
166, 946
188, 289
212, 645
316,130
205, 241
56, 824
384,392
37, 993
25, 860
59,126
51,753
53,863
50,993
13,179
62,819
285,862
- 4 , 301
2, 125, 870
470,167
__
34,256
243, 863
17, 743
-209
- 4 , 416
+324
152, 681
1, 700,868
272, 321
26,179
382, 408
61, 580
__
250, 712
-3,444
2, 015,146
495,172
__
90, 769
159, 943
- 2 , 783
-661
555, 470
1, 459, 676
131,085
364, 087
216, 293
+977
2, 499, 713
562, 259
129,449
86, 844
-9
+986
1, 699, 868
799, 845
385, 232
177, 027
Delaware _ _ _ _ _ _ _ _ _
P e n n s y l v a n i a __ _ _ _ _ _ _
W e s t Virginia
_ __ __
N o . 4—Winston-Salem
A l a b a m a . __ __
D i s t r i c t of C o l u m b i a
F l o r i d a ___ _ _ _ _ _ ___
Georgia ___
__ ___
Maryland
__.'_ __
N o r t h Carolina _ __ ___
S o u t h Carolina
Virginia
._ _
N o . 5—Cincinnati
Kentucky
Ohio
Tennessee
N o . 6—Indianapolis
Indiana
Michigan
_ __
N o . 7—Chicago
Illinois _
Wisconsin
229, 023
+19, 453
1, 443, 214
304, 439
Iowa
Minnesota
Missouri
North Dakota
South D a k o t a
42, 598
63, 107
115, 807
3,147
4,364
+943
+ 7 , 736
+10, 448
+439
-113
348, 959
535, 684
451, 940
58, 352
48, 279
69,042
117, 745
91, 791
15, 563
10, 298
N o . 9—Little R o c k
57, 778
+2,068
657, 443
145, 728
6,013
12,230
7,076
4,219
28,240
+409
-1,807
+73
-89
+ 3 , 482
64,597
178,958
89,337
25,760 1
298,791
12, 525
43, 691
13, 929
5,940
69, 643
N o . 8—Des M o i n e s
Arkansas
Louisiana
Mississippi
N e w Mexico
Texas
__
N o . 10—Topeka
Colorado _
K a n s a s __
Nebraska
Oklahoma
__
No. 11—Portland..
Idaho _
Montana
Oregon
Utah
Washington,
Wyoming
_ __
_ __
__
N o . 12—Los Angeles
Arizona.
California
Nevada
Possessions
44,154
+373
428,854
87, 577
12,600
11,283
7,060
13,211
+1,077
+770
+911
-2,385
150,899
101,947
96,160
79,848
31,163
21, 679
20,495
14, 240
84,078
+5,460
966,763
248,177
8,448 1
3,610
11,419
23,681
32,554
4,366
-137
+214
+2,430
+2,155
+855
-57
61,814
61,880
280,292
125,216
406,637
30,925
16,256
14, 766
74, 102
27,212
109, 200
6,641
-5,751
3,859,761
828, 591
60,332 1
3,765,863
33,566 |
15, 730*
805, 354
7, 507"
15,525 1
4 578'
799,894
__
1
10,940 1
783,110
5,844
1,057 1
-843 1
-4,589
-319
+132 1
289
Mutual Savings Banks
Mutual savings banks set new records during 1944
in the volume of deposits received, the number of
accounts, and total assets. An unparalled gain of
$1,625,000,000 in savings brought the year-end total
to $13,323,000,000—an increase of 14 percent compared with a 10-percent rise in 1943. Again, over
half of this rise occurred in the July-December period.
There are only 17 states in which mutual savings
banks operate, chiefly concentrated in the East. All
of them participated in the growing volume of
savings. New York and Massachusetts, which
already led in dollar deposits, again showed the
most sizable increases—$948,700,000 and $224,800,000, respectively. Oregon, the least active
" m u t u a l " state, recorded the smallest advance—
$1,700,000.
Not only was more money saved last year than
ever before, but more people were participating in
this expression of thrift. Last year brought a net
increase of 609,000 accounts in mutual savings banks,
raising the total to 16,321,229. All states except
Minnesota reported gains, most of them exceeding
those of the previous year. New York and Massachusetts showed the largest increases in this respect.
The combined growth in volume of savings and
number of depositors resulted in an increase of $72
in the average account. At the close of 1944 the
average mutual savings bank account was $817 compared with $745 the year before.
tively. At the close of 1944, this account totaled
$99,440,000 and represented only 0.7 percent of
assets. At the same date the year before, mutual
savings banks showed $212,000,000 in the owned
real estate account—1.7 percent of the assets of these
associations.
I t would seem that the question of whether or
not there is an irreducible minimum in the real
estate owned account is largely academic. Mutual
savings banks in Oregon and Delaware reported
no institutionally owned property on the books at
the close of 1944. Even in those states where
previous lack of marketing opportunities had been
most apparent, real estate owned dropped to the
equivalent of less than 1 percent of assets. The
only state in which this account represented more
than that was Vermont, which reported a fractional
rise from 2.61 percent in 1943 to 2.62 percent last
year.
Investment Portfolio
The rise in assets of mutual savings banks in 1944
reflected in large part the unparalleled increase in
deposits. Mounting to a new high of $14,813,000,000, the gain in resources totaled $1,770,000,000,
{Continued on p. 301)
DISTRIBUTION OF
MUTUAL SAVINGS BANKS* ASSETS
1940-1944
GOVERI MMENT
BOAJDS
Real Estate Activity
Again during the past year, real estate mortgage
loans of mutual savings banks declined. The rate
of drop, which had increased from 3 percent in
1942 to 4 percent in 1943, was stabilized at the latter
rate last year. Loans secured by real estate totaled
$4,298,000,000 after a dollar decrease of $137,000,000
which was considerably less than the $207,000,000
decline in 1943. Last year this account represented
29.2 percent of total assets compared with 34.6
percent in 1943. This decline was general throughout the 17 " m u t u a l " states. At the year-end,
Maryland banks reported only 6.7 percent of total
assets represented by real estate mortgage loans
while, at the other end of the scale, Oregon showed
an amount equal to 43.0 percent.
The disposition of real estate owned proceeded at
an accelerated pace in 1944. The 53-percent drop
last year far outstripped the recent declines of 36
and 25 percent registered in 1943 and 1942, respec290
20
STATE S MUNICIPAL
BONDS
RAILROAD
AND
PUBLIC UTILITY
BONDS
1940
'41
*42
'43
'44 1940
*4I
'42
SOURCE: Nat'l. Ass'n. of. Mutual Savings Banks.
Federal Home Loan Bank Review
THE UPWARD TREND IN LOAN AMOUNTS
The size of the average mortgage recorded has been expanding rapidly.
The following article analyzes this movement by type of lender and by
Federal Home Loan Bank District.1
•
FOR more than two years lenders in the mortgage finance field have been calling attention to
an inflationary trend in real estate prices which has
been brought about partly by an unparalleled rise in
income and, in a great many areas, by a complete
dislocation of the factors of supply and demand. In
particular, an effort has been made to keep the spotlight on those dangers to the future health and
stability of mortgage financing institutions and to
the economy as a whole which are inherent in accepting for lending purposes, those increases in
property values which sound judgment and experience indicate cannot be expected to be maintained
after "normal" functioning of the market has been
restored.
Inflationary Potentials
Rises in the market value of residential property,
which constitutes the security for the great majority
of total mortgage loans, have been extremely large
and obviously inflationary in many areas. Increases
as great as 75 to 100 percent in the price of homes
have been reported in a number of localities, and in
some war crowded centers prices are well in excess
of reproduction costs, which for the country as a
whole have risen almost one-third since 1939.
Many pressures are being brought to bear on
lenders to continue liberal prewar lending policies
in the current market. These include a plethora
of investment funds, keen competition for the
limited amount of mortgage business, a high rate of
mortgage repayments, and the fact that despite the
vast amount of savings accumulated by individuals,
a great many buyers in today's market are pressing
for high percentage loans which are based on presentday values.
In view of these circumstances, which are "ideal"
for the making of an inflationary boom, it is obvious
that some lenders of all types have been yielding to
the pressures for larger loans based on these inflated
property values. Almost every lender in the country
can recite from recent memory dozens of instances
in which loans have been made on properties in excess of their market value of only a few years ago.
i Prepared by Oscar H. Smith, and John W. Neumann of the Federal
Home Loan Bank Administration.
July 1945
These instances are none the less only the most
flagrant cases and do not provide a suitable yardstick against which to measure the performance of all
types of lenders. Such a measure, however, is available in the mortgage recording statistics which have
been compiled monthly since 1939 by the Federal
Home Loan Bank Administration. The first chart
shows the average size mortgage recorded by all
types of lenders from 1939 through March 1945, by
quarters. Throughout this period, the average
mortgage loan has increased almost steadily in size,
moving from $2,679 in the opening months of 1939
to $3,338 in the first quarter of this year, a rise of
almost one-fourth. Since 1943 the average size loan
has risen sharply and the trend is still upward.
A few explanatory remarks regarding these data
will give them added meaning. Averages are computed from estimates of the total number and amount
of all recorded nonfarm mortgages of $20,000 or less.
The exclusion of recordings in excess of $20,000
automatically eliminates distortions arising from
the inclusion of large mortgages on commercial
properties or huge residential projects. Too, most of
these loans (about 1,500,000 mortgages were recorded
last year) are being made on the same housing stock
that existed in the prewar years, except that these
properties have grown older and in many cases are
now in need of extensive repair.
AVERAGE SIZE OF ALL NONFARM MORTGAGES RECORDED
DOLLARS
3,5001
UNITED STATES 1
1
1939 TO 1945, BY QUARTERS
1
1
1
1
1
3,000
2,500
2,000
NOTE:- EXCLUDES MORTGAGES IN EXCESS OF $20,000
291
The continual upward movement in the size of the
average mortgage recorded represents a composite
of the activities of all lenders, those whose lending
policies have been relatively conservative as well as
those who have followed the rise of the market. This
movement also reflects activities in those areas of the
country in which increases in property values have
been relatively small, as well as in those regions where
property values rose rapidly during the defense
preparation and war years.
Excepting those held by insurance companies, the
average size of mortgages recorded by each of the
types of lenders has tended upward. As is shown in
the table on page 293, the average size of mortgage loans made by individual lenders, whose
operations are not limited by law, has shown the
greatest rise during recent years. Averages for these
lenders rose from $1,851 in 1939 to $2,537 in 1944,
a 37-percent jump, and in the first quarter of 1945
amounted to $2,761, or 49 percent more than in 1939.
Savings and loan associations were second in increase
of average size recordings over this period, the $3,146
for 1944 representing a rise of 28 percent, and the
$3,311 for the first quarter of this year, a rise of 34
percent. In the table it will be noted that even
though these two types of lenders have shown the
greatest gains in average size recordings, such
averages are still below those of the remaining types
of mortgagees.
The average size of mortgages recorded by insurance companies, which since these data were first
compiled by the FHLBA has been considerably
higher than that of any other type of lender, has
shown very little change during recent years. Insurance company recordings during the first quarter
of this year averaged $5,257, or 4 percent more than
in 1939, wThile the average size of recordings during
1944 was 1 percent less than in the base year.
Lenders in the "other," or miscellaneous, category
increased their average size mortgage 18 percent
from 1939 to 1944; however, the average for the first
quarter of this year, $4,033, was 25 percent higher
than in 1939. I n these comparisons, banks and trust
companies and mutual savings banks show almost
parallel trends in the average size of recordings, the
1944 averages for the two types of mortgagees being
10 and 8 percent, respectively, above the level
shown in 1939.
PERCENT CHANGE IN AVERAGE SIZE MORTGAGES RECORDED - 1939 TO 1944
BY FEDERAL HOME LOAN BANK DISTRICTS AND TYPE OF LENDER
292
Federal Home Loan Bank Review
A glance at the map will show wide variations in
lending trends among the various regions and among
types of lenders. Gains from 1939 through 1944 in
the average size of all recorded nonfarm mortgages
of $20,000 or less vary from 4 percent in New York
and 8 percent in the Pittsburgh region to 28 and
31, respectively, in the Winston-Salem and Portland
regions. Among the classes of lenders, changes
ranged from increases of 49 and 53 percent, respectively, in the average size of mortgage loans made by
individuals in these latter regions to decreases of 21
percent in the average size of mutual savings bank
recordings in the Winston-Salem District and 9 percent in insurance company mortgages in the Pittsburgh, Winston-Salem, and Little Rock areas. I t
will be noted that in every District except Chicago
and Des Moines the average size of mortgages
recorded by individuals has shown the greatest percentage rise. In those two regions, savings and loan
associations showed the greatest percentage increase.
In six of the Bank Districts, savings and loan
associations evidenced increases second only to those
of individuals; in two regions, "other" lenders reported the second largest percentage rise; and in one
District, banks and trust companies reported the
second largest increase. In seven Districts, the
average size of mortgages recorded during 1944 by
insurance companies was lower than in 1939 and in
all but one of the remaining, percentage increases in
the size of insurance company mortgages were
relatively small. In the Los Angeles District,
insurance company recordings increased 25 percent
over this period as compared with a rise of 18 percent
in the average size of total nonfarm mortgages.
With few regional exceptions, percentage increases in
the average size of mortgages recorded by banks and
trust companies and mutual savings banks were
relatively low.
Dollar Amounts Up
Dollar increases in the average size of mortgages
recorded by some types of lenders have been extraordinary in several regions. The largest advance
in the average size of all mortgages was in the
Portland District, $715, followed by the WinstonSalem, Los Angeles and Chicago areas with gains
of $638, $586, and $544, respectively. By type of
lender, increases in the size of average recordings
have ranged as high as $1,516 for "other" lender
recordings in the Portland District and $1,530 in
insurance company mortgages in the Los Angeles
region. The largest dollar rise for savings and loan
July 1945
Average amount of nonfarm mortgages
recorded—United States, by type of lender 1
Average size mortgage
Percent change
1939 to—
Type of lender
quarYear 1939 Year 1944 1st
ter 1945
Savings and loan associationsInsurance companies. _ _ _ _
Banks, trust companies
Mutual savings banks
Individuals..
_._ - . .
Others
.__ Total
1944
1st quarter 1945
$2,467
5,076
3,201
3,622
1,851
3,231
$3,146
5,033
3,525
3,927
2,537
3, 823
$3, 311
5,257
3,605
4,134
2,761
4,033
28
—1
10
8
37
18
34
4
13
14
49
25
2,722
3,187
3,338
17
23
i Based on mortgages of $20,000 or under.
associations, $944, was reported in Winston-Salem.
The average recording by mutual savings banks
in the Cincinnati District was $1,329 larger in
1944 than in 1939. The steepest dollar rise in the
average size of mortgage loans reported by individual
lenders was the $935 increase reported in the WinstonSalem region, while the maximum bank and trust
company increase, $889, occurred in the Los Angeles
area.
This discussion indicates that all types of lenders
have, to greater or lesser degree, been " following"
the rise in property values. I t also supports the
contention of many that there are mortgagees of all
types who have been and are continuing to recognize,
for lending purposes, increases in values which have
been created under artificial circumstances and which,
if we can accept past experience as a guide, will
disappear in part upon the restoration of a balance
between supply and demand factors. The future
health and prosperity of mortgage financing institutions which let short run exigencies and demands dim
their long-term prospective may well be seriously
damaged should these trends continue.
The upward movement in average mortgage recordings may represent water already on the books.
Many mortgagees are attempting to compensate for
increased loan valuations through an acceleration in
the amortization of their loans. However, as was
learned from the last depression, loans placed on the
books increased in hazard with the downward swing
in values and in individual income payments. Correspondingly, lenders today must take into account
the contingency of a drop in economic activity. As
the time approaches when the level of individual
incomes must begin to diminish, so shortens the time
in which they may realistically expect accelerated
amortization to cover added risk from inflated
increment to loan values.
293
rum
Annual wage
spurs home ownership
The annual wage and profit-sharing
plan of Hormel & Co. has made
Austin, Minnesota, a city of home
owners, according to a recent report
carried in the Detroit (Michigan) Free
Press. Of the 4,275 homes in Austin,
3,125 come under the Minnesota
Homestead Tax Exemption Act, which
means that they are owner occupied.
"Seventy-five percent, at least, of
the members of our union own their
own homes. Families bought or built
houses since the annual wage came who
couldn't have purchased them otherwise . . . " stated the president of
the United Packinghouse Workers of
America Local. Although the annual
wage is not guaranteed, the company
expects to be able to continue on the
same basis that it has for 15 years.
Postwar plans for new business include
the expectation of providing yearround jobs for 1,643 employees now
in the armed forces.
Future building calls for
more trained workers
Prompt expansion of vocational programs to train new workers for the
building trades will sharply reduce the
time required to meet the most urgent
civilian construction needs after the
war, recently predicted James W.
Follin, Managing Director of the
Producers' Council. The Council is a
national organization of manufacturers of building materials and equipment.
Failure to set up such training programs may mean that building products may become plentiful before
there are enough skilled workmen to
assemble them. While the total supply of construction labor will undoubtedly be adequate, certain types
of trained and experienced craftsmen
needed for quality construction will
not be available until thousands of
new workers are taught.
Except for men who have acquired
building skills as part of their experience in the armed services, very
few apprentices have entered the
294
v III
Fill
construction industry in the past five
years. During the last two decades,
the labor supply in some lines has
shrunk at an alarming rate because
the rate of replacements has not
equaled the loss of craftsmen through
death, retirement or military service.
The decline of construction activity
during the depression accentuated the
downward trends which have been
evident in these fields.
Consumer credit
control modified
In a further effort to curb inflation,
the Federal Reserve Board last moifth
issued Amendment 16 to consumer
credit Regulation W. This amendment repeals the previous exemption
of extensions of credit secured by first
liens on improved real estate. In
addition, effective June 11, it prescribes a maximum maturity of 18
months for loans of not more than
$1500 for financing the purchase of
certain materials, articles and services
in connection with repair or improvement of residential property.
This limitation applies, as well, if
such a loan is added to the unpaid
balance of a previously existing mortgage loan and the two total $1500 or
less, regardless of how they were
merged or consolidated. Regulation
W does not cover extensions of credit
to finance or refinance the construction or purchase of an entire structure.
The new amendment also makes
some changes in the classification of
listed articles, downpayment and maturity limitations, and contains provisions relating to "summer plans" for
fuel conservation items and to exemptions for "disaster credits".
Postwar capital equipment need
set at $28 billion annually
If the need for nonfarm housing during the period 1946-1960 is to be met,
an average of $5,065,000,000 must be
spent yearly for this purpose, according to preliminary estimates released
in May by the Twentieth Century
Fund. Nonfarm housing is one of the
major items included in the Fund's
estimate that an average of about
$28,000,000,000 annually would be
necessary during the 15-year period to
fill all requirements for new capital
equipment—the country's relatively
permanent physical assets.
Stated in terms of 1940 price levels,
the preliminary report covers 24 specific fields grouped into four major
categories: urban development, commercial and industrial, transportation and rural development. Capital
outlays in fields not included in the
detailed estimates, it is assumed,
would maintain their past ratios to the
other groups. These estimated capital
needs, plus the postwar demand for
consumer goods and services, would
be more than enough to keep our
economic system operating at high
productive levels.
Along with the estimates of maximum outlays needed for capital equipment if our economic system does
operate at high levels, the report outlines a "minimum" program. This
program covers only capital outlays
necessary to care for normal growth
in population, to replace capital goods
actually worn out or used up, and to
provide for essential expansion of
capital facilities. Even such a "minimum" program in the 24 fields being
studied would require an annual
average expenditure of $8,000,000,000.
States liberalize
worker benefits
Unemployment benefits and "second
injury" compensation have been the
subject of legislative action in a number of states this year, the Council of
State Governments reports. Unemployment compensation laws have
been revised in a score of states to
increase weekly benefits for longer
periods, thus assuring workers and
their families an adequate standard of
living and minimizing the depressive
effects of unemployment during a
reasonable period of reconversion from
war production. The "second injury"
legislation is expected to encourage
the hiring of disabled war veterans,
Federal Home Loan Bank Review
ispecially in industries already covered by these laws.
So far, a t o t a l of 21 states has
>rovided m a x i m u m weekly benefits of
it least $20 for unemployed covered
workers. In most states, m i n i m u m
benefits were raised along with t h e
ncrease in m a x i m u m benefits.
The
-ange between the two limits in t h e
najority of states is about $10. In
some cases, t h e period between appli3ation a n d granting of benefits was
shortened.
Under "second i n j u r y " legislation
now in force in 25 states, should further
or permanent disability befall a previously disabled employee, t h e employer becomes legally responsible
only for t h e second injury. I n a d d i tion to the employer's compensation,
the employee will be paid out of t h e
second injury fund t h e remainder of
compensation due for permanent t o t a l
disability.
The public looks at
postwar housing
Houses built after t h e war will be
substantially different from prewar
dwellings in b o t h design and appearance, in t h e belief of 56 percent of t h e
n a t i o n ' s family heads. A survey conducted by t h e Curtis Publishing Co.
further reveals t h a t 44 percent of
these family heads will postpone either
building or buying a home until they
can get t h e housing features t h e y
want.
Most people, t h e s t u d y indicates,
a r e primarily concerned with developm e n t s in t h e housing field which are
b o t h practicable and structurally possible for t h e building industry t o acchieve. Gadgets and p u s h b u t t o n miracles still in t h e blueprint stages or
untried by actual use don't interest t h e
majority of potential home owners
who were questioned.
T h e reaction to prefabricated housing was varied: 17 percent of t h e
people interviewed would consider
prefab houses for fulltime homes while
58 percent would be interested in
ready-made vacation homes. T h e
prospects for economy a n d speed in
erecting such houses appeal to prospective buyers b u t t h e s t u d y points
o u t t h a t "continuous p r o d u c t improvem e n t " will be necessary t o spur and
m a i n t a i n high sales volume for t h e
manufacturer who plans to participate
in the p e r m a n e n t dwelling market.
July 1945
When asked to name t h e building
development in which they were most
interested, 19 percent of those interviewed chose new types of wall and
floor construction; 18 percent, glass
for structural purposes; 16 percent,
modern kitchens; a n d 13 percent,
plastics. As to style of architecture,
opinion was fairly evenly distributed.
Early American colonial was preferred
by 19 percent; " b u n g a l o w " style by 17
percent, a n d " m o d e r n " by 12 percent.
Lowell bank assists
local veterans
Embracing all its customers in t h e
a r m e d forces, t h e Middlesex Cooperative Bank of Lowell, Massachusetts, has extended t h e 4-percent
interest r a t e set b y t h e GI Bill of
Rights t o all existing mortgage loans
held by borrowers who now are or have
been in service any t i m e during t h e
present war. This b a n k is reported
t o be t h e first lending institution in
t h e country t o t a k e such a step.
Lowrell veterans can find out about
their rights and benefits under t h e GI
Bill at a forum sponsored by t h e bank.
Joining forces several nights a m o n t h
in space provided by t h e Middlesex
Bank, American Legion a n d b a n k
officials meet w r ith veterans t o assist
t h e m with financial a n d other readj u s t m e n t problems.
New priorities assistance
for home building
Additional priorities assistance in
t h e acquisition of a wider range of
materials for housing construction has
•recently been provided by t h e N H A
a n d W P B . T h e action was m a d e
effective b y an a m e n d m e n t to t h e War
Housing Critical List—Schedule I of
Preference R a t i n g Order P - 5 5 - c . T h e
shortened a n d simplified schedule is
based on t h e present critical position
of materials a n d equipment essential
to residential building. I t will be revised when changes in t h e supply
situation w a r r a n t .
Applications are to be m a d e to F H A
field offices and approval will constit u t e authorization to begin construction under Order L - 4 1 . T h e new
action permits t h e use of t h e A A - 3
rating a n d allotment symbols H - l ,
H - 2 or H - 3 assigned by t h e order for
materials to be used in N H A approved
projects, except as specifically prohibited or restricted by Schedules I
and I I of t h e order.
FOR THE FUTURE
In the midst of war, many towns and
communities are making their plans "For
the Future" in order to have healthier,
more attractive cities, and to provide employment for the returning
servicemen
and workers.
From time to time, as information becomes available, the R E V I E W
will publish accounts of some of these.
St. Louis gets a new
building code
After seven years of work St. Louis
has a new building code. T h e m a y o r
recently signed t h e new code p u t t i n g
into effect what is said to be one of t h e
most up-to-date set of regulations in
t h e country. More t h a n 200 members
of t h e building a n d associated industries have contributed t o t h e finished
product.
Providing for t h e use of modern
materials a n d more flexible building
regulations, t h e 1945 code is expected
to stimulate postwar construction in
St. Louis. One special feature of t h e
new charter is t h a t it does not n a m e
specific materials to be used b u t
instead sets fire resistance s t a n d a r d s
for materials as recommended b y t h e
National Board of Fire Underwriters,
American S t a n d a r d s Association a n d
similar national organizations.
Springfield looks
ahead
I n t h e course of the p a s t year, t h e
Greater Springfield a n d Clark County
Association, a civic public participation group, organized a t o t a l of 23
separate s t u d y projects, each under t h e
auspices of a committee, to arrive a t
practical solutions of some of t h e city
problems of Springfield, Ohio. F r o m
membership dues of $1 a year and s u b stantial contributions by p r i v a t e industry, t h e association reports t h a t
it has h a d no difficulty in financing
its undertakings and, as of J u n e 1,
1945, could show a n unobligated
balance of $15,000 in its treasury.
N o t only has the committee been
able t o furnish detailed reports on
water projects, sewerage, traffic congestion a n d other studies, some of
wThich now show tangible results, b u t
it has also organized a Demobilized
Veterans' Service. I n this l a t t e r p r o j ect, all groups in Springfield are p a r ticipating wdth t h e Association t o
provide t h e veteran with free legal,
medical, a n d insurance advice as well
as vocational training a n d help.
295
RESIDENTIAL BUILDING ACTIVITY AND SELECTED INFLUENCING FACTORS
1935-1939=100
BY MONTHS
BY YEARS
INDEX
220
ADJUSTED FOR SEASONAL VARIATION / k . /
PRIVATE
200
1 8 2 FAMILY DWELL.UNITS
j
(FED. HOME LOAN BANK A D M . ) X
U.S. C EPT DFLA B. RE CORD*3
180
i
CONSTRUCTION^
(
/
/
.AI
160
/
/
140
IV
\ /
120
.*^«
5S.6 LN LEN D.
V*sv<
FED. HOM ELN. BK.A
100
80
/
I
A
i
ifVl"
*..'*"x /
/
V
8 LN. LEWD.
/ —/
f
/r
\
V
60
>../*
/
/VsVGS.
I
/y
/
.*
.J
.PRIVATE CONSTRUCTION
r_j i a e FAMILY DWELL.UNITS
./
\
N.^
..«•'*
-^
40
[
ivu/vr«fTiw -^ 1 \ ^
FORECLOSURES 1
20
fNONFARM F'ORECLOSURES
(FFD wniuiF i M R K AnM^
1
0
140
-
1201-
¥r
l\yS.
tool
V
^
• i f "
ILDI M A
1 1
I 1
I
i i
i
-
r.trrr T-
T-
\AAT\ ~ P / /
-
I 1
1 1
I 1
1
1
1 1
1 1
1 1
r+r
,-»••'
PFWT.q
DEPT OF LABOR)
• ^ 5
80\
1
^ - O U / L D H V G IWMJ err/ML r r r i i / c o
*^
~"
1 1
1 h
M
— RENTS
^ —
1
L PP l ^ f -. Oe
(U. 5. DEF>T. OF LAB( DR)
1 1
60
280
1 I
I 1 1 1
l 1
1 1
1 l
ADJUSTED FOR SEASONAL
1 1
i
260
240
INDLISTRIAL PRODUC
;T/ON-*S
220
KFED.
rttat KVt
BUMfC 3)
r
l
1
1
VARIATION
1
fINDUSTRIAL
!• 1
l
1*RODlJCTK)N
^•*"N.
p».——s
^
-*""
*>
*Nfcj
.
,,— <
f
"
1 y
"V/M COME; PAYMENl S
i
200|
/ j
>
180
/
/J
160]
I00\
—
"*"••%.
••"••,..,
MF6. EIVIPLO^fMEN TS
/
INCOME PAYMENTS
v/ *r (U.S.
DEPT OF C O M M E R C E ) ^
>;-..
80
60
'*
t
140]
120
•••••••.,
•••**"
"...
"•\;
...••••
(&*'
^
j£
v _ V
^\
-MFG. EMPLOYMENT
(US.
DEPT OF LABOR)
11 1
1 I
WAR SAVINGS BONDS
, N D EXWHOLESALE
1 1
1
1
I
i
i i
1
1944
1943
1930 '31 '32 *33 *34 '35 '36 '37 *38 *39 '40 '41 '42 '43 '44
l
! 1
1
1
1 1 1 1 1 1
1945
DEPARTMENT STORE SALES
COMMODITY PRICES
180
1935-1939 = 100
A
\ ^
BUILDING MATERIALS-^
.
1<
J - / "
As^
^
A <
'I
^^r
ALL INDUSTRIAL'
IIIIIMIMIMIIIII
296
III l l l l M l M l
III.,
l i l t . .
nl.ilnlii
,,!,:!,,:,
ILli-JuJU-
Federal Home Loan Bank Review
« « «
MONTHLY
S U R V E Y
» > >
HIGHLIGHTS
/. Cutbacks resulted in a 4-point decline in the industrial production index which in May dropped to 227 percent of the
average,
1935-1939
II. Total building activity showed no change from April, on the basis of an 18-percent increase in private construction offset by a decline
in publicly financed building.
II. New loans of approximately $163,000,000
were made by all savings and loan associations during May—6 percent more than
April and 23 percent above May 1944.
A. Home purchase loans continued to account for three-fourths of total savings and loan activity.
B. Construction lending increased 37 percent above the April volume and was 78 percent more than in May 1944.
V. During May, nonfarm mortgage recordings of $20,000
or less reached a new peak of $487,435,000.
percent above the April volume and 20 percent more than the total in May of last year.
V. Repayments of $7,423,000
and advances of $6,307,000
the end of May to
$50,924,000.
in
This represented a gain of 7
dropped the total of Federal Home Loan Bank advances outstanding at
VI. Assets of all insured associations rose 2 percent to $5,292,000,000
at the end of May.
ft ft ft
BUSINESS CONDITIONS—Seventh
War Loan exceeds goal
Despite optimism generated by VE Day and
increasingly favorable news from the Pacific war
zones, sales in the Seventh War Loan had soared to
$26,313,000,000, or 88 percent above the goal of
$14,000,000,000, when the drive ended July 9. Although individuals invested a total of $8,681,000,000
(preliminary figure), or 24 percent over their original
quota, E bond sales lagged at $3,976,000,000—only
99 percent of the goal set for these purchasers.
During May the nation's expenditures for war
increased to $8,159,000,000 from the April figure of
$7,139,000,000. This was considerably more than
the $7,879,000,000 spent in May 1944, just before
our forces invaded Europe.
Industrial activity continued to decline slightly
in May, dropping to 227 percent of the 1935-1939
average shown by the Federal Reserve Board's
seasonally adjusted index, as compared with 231
percent in April. Manufactures fell 5 points from
the April figure of 247 percent. The change was
confined to durable goods, including war production, where the range was from 336 in April to 327
in May. Nondurable manufactures during May
remained stationary at 174 percent of the 19351939 average output. The production of minerals
also slackened, dropping from 140 percent in April
to 138 percent in May. Most of the decrease in
industrial production reflected cutbacks in procurement of military supplies.
July 1945
Toward the end of June, WPB announced it had
approved 754 applications for preference ratings for
reconversion equipment and construction. Nearly
one-fourth of the approvals went to the automotive
industry, followed in order by manufacturers of
domestic mechanical refrigerators, furniture and
finished lumber products.
In May the Federal Reserve Board's seasonally
adjusted index of department store sales rose to 187
percent of the 1935-1939 base, after a drop to 181 in
April. The trend in early June continued upward
as the index climbed from 169 for the week ending
June 2 to 196 in the week of June 9.
Although the size of the labor force in the United
States increased by 100,000 in May, the Bureau of
the Census reported that the 52,030,000 workers
potentially available during that month represented
a drop of 810,000 from May 1944. Non-agricultural
occupations in May claimed 43,350,000 workers, a
decrease of 60,000 from April. Unemployment slid
from a total of 770,000 in April to 730,000 persons
in May.
[1935-1939=100]
May
1945
65.1
108.3
131.0
215.7
227. 0
156.3
242.8
April
1945
Percent
change
48.9 + 3 3 . 1
108.3
0.0
130.8
+0.2
208.5
+3.5
231.0
-1.7
r 158. 2
-1.2
' 242. 3} + 0 . 2
May
1944
49.5
108.1
129.2
175.3
236.0
171.6
232.1
Percent
change
+31.5
+0.2
+1.4
+23.0
-3.8
-8.9
+4.6
r Revised.
Adjusted for normal seasonal variation.
1
297
BUILDING ACTIVITY—Continued
increase in private construction
Total residential construction activity in urban
areas of the United States continued in May at the
same level as in April. According to data compiled
by the Bureau of Labor Statistics, permits were issued or Federal contracts awarded during May for
the construction of 12,490 family dwelling units,
only one more than in the preceding month.
Privately financed construction, however, continued its recovery from the low level of less than
5,000 units reached in December 1944, permits
being issued during May for 11,207 units compared
with 9,530 in April—an increase of 18 percent. This
gain was offset by a drop from 2,959 in April to
1,283 during May in the number of publicly financed
units placed under contract.
During the first five months of this year a total
of 43,400 dwelling units were provided in all urban
areas: 39,100 by private funds and 4,300 by public
money. In total, this represented a drop of about
9,550 units, or 18 percent, from the 52,940 provided
in the same months of 1944. More than half of this
decline occurred in public construction. [TABLES
1 and 2.]
RESIDENTIAL CONSTRUCTION
THOUSNEW
and labor contributing to this increase with gains o
1.5 and 2.3 percent, respectively.
Of the 16 cities for which construction costs wer<
reported in June, 10 have increased, 4 showed n(
change, and 2 indicated slight declines from the las
reporting period.
According to Department of Labor data, wholesale
prices of building materials moved fractionally upward during May to 131.0 percent (1935-1939=100;
after a standstill in April. During the past 1^
months, the index has risen 1.4 percent, reflecting
the advance in all components except plumbing anc
heating and structural steel items which remainec
at the May 1944 level. [TABLES 3, 4, and 5.]
Construction costs for the standard house
[Average month of 1935-1939=100]
Element of cost
Material
Labor
Total
r
May
1945
April
1945
Percent
change
Mav
1944
Perceni
change
132. 3
140. 5
r
132. 1
140. 6
+ 0. 2
-0. 1
130. 3
137. 3
+ 1. 1
+ 2. 3
135. 0
'135. 0
0.0
132. 7
+ 1.7
Revised.
MORTGAGE LENDING—Volume
continued upward
URBAN AREAS - NO. OF DWELL. UNITS
1942
19*3
1944
1945
BUILDING COSTS—Total
unchanged in M a y
During May, the index of total construction costs
for the FHLBA standard house remained unchanged
from the revised April level of 135.0 (1935-1939 =
100). A small advance to 132.3 in material prices,
offset by a fractional decrease to 140.5 in labor costs,
accounted for this stability. I n comparison with
May 1944, total costs rose 1.7 percent, both materials
298
May was the third consecutive month in which the
dollar volume of new mortgage loans made by the
savings and loan industry has exceeded that made
in any other month since the twenties. On the basis
of monthly reports received, it is estimated that all
operating associations made about $163,000,000 of
new loans, an increase of 6 percent over the April
total of $154,000,000 and a gain of 23 percent above
the May 1944 volume. The largest amount of new
loans made by these institutions in any 1941 month
was $134,000,000.
The increase in May 1945 was almost universal,
only the Chicago District reporting a smaller volume
of new loans than in April. In the remaining areas,
gains ranged from as much as 17 percent in New
York to 2 percent in Cincinnati. The increase in
savings and loan lending from a year ago was general
in all parts of the country. Advances varied from as
high as 48 percent in the New York District to as
low as 7 percent in the Des Moines region.
The gradual rise in privately financed residential
construction activity from the extremely low levels
of last winter was reflected in a moderate increase in
Federal Home Loan Bank Review
N e w mortgage loans distributed b y purpose
[Dollar amounts are shown in thousands]
Construction.
H o m e purchase
Refinancing
Reconditioning
Other purposes
$13,
120,
15,
3,
10,
Percent
change
April
1945
May
1945
Purpose
032
244
887
396
520
$9, 541 + 36. 6 $7, 338 + 77. 6
+ 5. 8 98, 872 + 21. 6
113,684
- 5 . 4 14, 415 + 10.2
16, 800
2, 951 + 15. 1 2,967 + 14. 5
- 2 . 4 8,931 + 17. 8
10, 778
+ 6. 1 132, 523 + 23. 1
163, 079 153, 754
Total
Percent
change
Mav
1944
MORTGAGE RECORDINGS-May
the dollar volume of construction loans by savings and
loan associations. The $13,000,000 of such loans
made during May, although representing only 8
percent of total new loans during the month, exceeded the April volume of construction loans by 37
percent and was 78 percent above the May 1944
volume. However, loans for the purchase of existing
homes, which amounted to approximately $120,000,000 in May, continued to account for about threefourths of total savings and loan lending.
TOTAL LOANS MADE BY ALL SAVINGS AND LOAN ASSOCIATIONS
M
_
UNITED STATES-BY TYPE OF ASSOCIATION
|
1rOTAL
(ALL
»SSOCIAT
ONS)X
uFEDERALS
.
j *
s&
~S***
"\TE CHARTER• ^
MEMl 1ERS
s /
V
r
NONMEMBB7?S-^
, ,
1 1
DEC.
MAR.
JUN.
I
SEP.
1943
1
|
DEC.
1
MAR.
In the first five months of this year new loans
aggregating about $667,000,000 were made by all
associations, an increase of 21 percent over the
estimated $550,000,000 reported in the like period
of 1944. With the exception of construction loans,
which dropped 25 percent in this cumulative comparison, all types of loans contributed to the rise.
"Other" purpose loans gained 30 percent; home purchase, 27 percent; refinancing, 14 percent; and reconditioning, 12 percent. [TABLES 6 and 7.]
activity set new high for series
Nonfarm mortgages of $20,000 or less recorded
during May totaled $487,435,000. Thus, for the
second consecutive month, the dollar volume of these
recordings continued its rise to new heights for the
series (started in 1939). Recordings in May were
about 7 percent greater than those reported in April
and 20 percent above the total indicated for May of
last year.
Cumulative through the first five months of 1945,
more than $2,000,000,000 of mortgages were recorded by all lenders, a sum 18 percent greater than
that noted for the like period of 1944. The average
size of such mortgages recorded during the current
year was $3,360. For the month of May, the average
was $3,398, about 7 percent above the average of
$3,187 recorded in May 1944.
Again, all types of lenders with the exception of life
insurance companies recorded a greater volume of
mortgages during May 1945 than in the corresponding month of the previous year. Proportionately,
the largest percentage increase was shown by
M o r t g a g e recordings b y t y p e of mortgagee
1 1
1 1
JUN.
1
SEP.
1
DEC.
1 i
1
MAR.
1944
1
1 1
JUN.
1945
SEP.
DEC
[Dollar amounts are shown in thousands]
UNITED STATES-BY PURPOSE OF LOAN
BY MONTHS
T y p e of, lender
PerPerCumucent
cent
lative
of
change
recordM
a
y
from
ings (5
April
1945
months)
1945 a m o u n t
Savings a n d loan associations
+ 9. 7
+ 8. 8
Banks, t r u s t companies. _ + 2. 6
M u t u a l savings banks
+ 21. 1
Individuals
+ 6.0
Others
+ 3. 5
Total
July 1945
+ 6. 9
Percent
of
total
recordings
3 5 . 4 $703, 619
4. 4
95, 762
18.7
388, 814
71, 103
3.9
25. 8 551, 981
1 1 . 8 258, 558
34. 0
4. 6
18. 8
3.4
26. 7
12. 5
100.0 2,069,837
100. 0
299
individuals with recordings 31 percent higher than
May 1944. Mutual savings banks experienced the
second largest rise, up 28 percent. Recordings by
savings and loan associations were 23 percent higher
than in May of last year. [TABLES 8 and 9.]
FHLB SYSTEM—Advances doubled,
repayments dropped
Reaching the lowest point since June 1933, the
total balance of advances outstanding for all F H L
Banks at the close of May was $50,924,000. This
represented a drop of $1,116,000 from the April
balance of $52,040,000, shared in by 9 of the 12
Banks. Only Des Moines, Winston-Salem and Boston carried larger outstanding balances than they
had in April. The May balance fell 29 percent, or
$20,682,000, below that for the same month the
year before.
Current advances for the entire Bank System rose
to $6,307,000 in May, more than twice those of
$3,061,000 in April of this year, and 60 percent over
the $3,939,000 advanced in May 1944. Only three
Banks reported smaller advances during May than
in the preceding month. Portland made none at all
in May as compared with $130,000 in April, while
Topeka experienced an 82-percent drop to $20,000
from $113,000 in April. The Chicago advances fell
to $1,173,000 in May, or 17 percent beneath the
April total of $1,417,000.
For the fifth consecutive month, repayments declined during May to $7,423,000, or 39 percent
below those made by all Banks in April. The May
figure was slightly less than one-half as large as the
May 1944 total of $14,978,000. Only 2 of the 12
Banks in the System ran counter to the general
trend of smaller repayments during the month.
Member institutions in the Cincinnati District repaid
$877,000 in May, a 47-percent increase over the
April total of $595,000, while the Topeka Bank
received over five times the April repayments—
going from $86,000 to $441,000. [TABLE 12.]
F L O W OF PRIVATE REPTJRCHASABLE CAPITAL
During May, gross receipts of private savings by
all operating savings and loan associations approximated $162,000,000 and withdrawals, about $82,000,000. The resulting excess of savings receipts over
withdrawals by investors added about $80,000,000
to the private repurchasable capital of these institutions, compared with a net addition of about $75,000,000 during the preceding month. The greater net
300
inflow of savings during May came not from an
increase in gross receipts, which were only slightly
less than in April, but from a $5,000,000 decline in
withdrawals. The net inflow of private savings
during May—$80,000,000—was $3,000,000 greater
than in the same month of last year.
During the first five months of this year, approximately $888,000,000 of private savings was invested
in savings and loan associations, about 21 percent
more than in the same months of 1944. Withdrawals
through May of this year amounted to an estimated
$500,000,000, resulting in a net increase of $388,000,000 in the amount of private savings held by these
institutions. During the first five months of 1944,
savings receipts exceeded withdrawals by approximately $306,000,000.
Share investments and repurchases, May 1945
[Dollar amounts are shown in thousands]
All insured
associations
All associations
I t e m and period
Uninsured
members
Share investments:
1st 5 mos. 1945_ __ $887, 982 $723, 388 $103,
1st 5 mos. 1944
732, 932 565, 363 100,
Percent change
+ 21
+ 28
162, 084 130, 182 20,
M a y 1945
141, 024 109, 049
Mav 1944
19,
Percent change
+ 19
+ 15
Repurchases:
1st 5 mos. 1945
1st 5 mos. 1944
Percent change
May 1945
M a y 1944
Percent change
Nonmembers
769 $60, 825
029 67, 540
-10
+4
925 10, 977
623 12, 352
-11
+7
$500, 459 $387, 201 $69, 603 $43, 655
426, 517 314, 217 65, 920 46, 380
+ 23
+ 17
+6
-6
82, 091 62, 980 12, 883 6,228
_
63, 676 44, 403 10, 881 8,392
+ 42
+ 29
+ 18
-26
Repurchase ratio (percent) :
1st 5 mos. 1945
1st 5 mos. 1944
Mav 1945_
Mav 1944
56.
58.
50.
45.
4
2
6
2
53.
55.
48.
40.
5
6
4
7
67.
65.
61.
55.
1
9
6
5
71. 8
68.7
56. 7
67.9
INSURED ASSOCIATIONS—Total
resources showed moderate gain
The 2,469 insured savings and loan associations
had $5,292,000,000 in assets at the close of May.
Federals, numbering 1,466, held about $3,338,000,000
while the 1,003 insured state chartered associations
had approximately $1,954,000,000 in total resources.
The over-all increase for the month amounted to
$87,500,000.
For the third consecutive month the private capital
balance of insured associations went up approxiFederal Home Loan Bank Review
mately $70,000,000. Since the beginning of the year
private capital accounts have increased $345,000,000,
or 8 percent, bringing the balance at the end of M a y
to $4,678,000,000. On M a y 31,1945, private repurchasable capital made up over 88 percent of total
resources while a year before 86 percent of the total
represented private accounts. Insured associations
made new loans of $121,800,000 during the month,
a 25-percent increase over M a y 1944 when credit
amounting to $97,500,000 was extended for first
mortgage loans.
[TABLE 13.]
FEDERAL SAVINGS AND LOAN ASSOCIATIONS
At the end of May, Federally chartered associations
had $2,988,000,000 on their books in private capital
accounts, a $227,500,000 increase (or 8 percent) since
the beginning of the year. These accounts made up
89.5 percent of total resources compared with 87.5
percent a year ago. Federals extended $75,600,000
for new loans during May, while a year ago $59,200,000 of new money was loaned.
Progress in number and assets of Federals
[Dollar a m o u n t s are shown in thousands]
Number
Approximate assets
Class of association
M a y 31, April 30,
1945
1945
632
834
New
Converted
T o t a L _ _ __
1,466
May 31,
1945
April 30,
1945
632 $1, 134, 934 $1, 113,484
833 2, 202, 714 2, 167, 022
1,465
3, 337, 648
3, 280, 506
Banks
{Continued from p. 290)
or 14 percent, compared with a 9-percent advance
in 1943 and about 1 percent the prior year. Of the
$1,770,000,000 increase shown in 1944, approximately
$145,000,000 was not offset by gains in deposit
liability.
Mutual savings banks, like savings and loan associations, have shown an increasing emphasis on their
Government bond account. Last year the proportion of these obligations increased from 46 to 56
percent of total assets on the basis of a $2,400,000,000
gain which brought the total to $8,303,000,000.
According to the National Association of Mutual
Savings Banks, "besides direct distribution to the
public, mutual savings banks have diverted about 55
percent of deposits to standard Government issues/'
July 194S
Again following the pattern that has been characteristic of savings and loan associations, the cash
account of mutual savings banks declined in 1944
after remaining relatively stable from 1942 to 1943.
At last year-end the percentage of cash to assets was
down to 3.9 from 5.8 percent.
The surplus and undivided profits account increased $114,000,000 during 1944 and amounted to
$1,368,000,000 on December 31. However, the
large increase in assets meant that this account
represented fractionally less of total assets—9.3
percent in 1944 compared with 9.8 the year before.
Membership of Advisory Council
•
T H E Federal Home Loan Bank Administration
has recently announced the election and appointment of members of the Federal Savings and Loan
Advisory Council. These members will serve for
the period ending M a y 27, 1946.
Elected:
Boston: R a y m o n d P. Harold, Worcester Federal Savings a n d
Loan Association, Worcester, Massachusetts (re-elected).
New York: J. Alston Adams, Westfield Federal Savings a n d
Loan Association, Westfield, N e w Jersey (re-elected).
Pittsburgh: J a m e s J. O'Malley, First Federal Savings a n d
Loan Association of Wilkes-Barre, Wilkes-Barre, Pennsylvania (re-elected).
Winston-Salem:
F r a n k Muller, Jr., Liberty Federal Savings
a n d Loan Association, Baltimore, Maryland.
Cincinnati: W m . Megrue Brock, T h e Gem City Building a n d
Loan Association, D a y t o n , Ohio (re-elected).
Indianapolis:
Walter Gehrke, First Federal Savings a n d
Loan Association, Detroit, Michigan (re-elected).
Chicago: Earl S. Larson, First Federal Savings a n d Loan
Association, Moline, Illinois.
Des Moines: J o h n F . Scott, Minnesota Federal Savings a n d
Loan Association, St. Paul, Minnesota.
Little Rock: J. J. Miranne, Security Building a n d Loan Association, N e w Orleans, Louisiana (re-elected).
Topeka: R a y H . Babbitt, H o m e Building a n d Loan Association of Lawton, Lawton, Oklahoma (re-elected).
Portland: S. S. Selak, Prudential Savings a n d Loan Association, Seattle, Washington.
Los Angeles: Douglas H . Driggs, Western Savings a n d Loan
Association, Phoenix, Arizona.
Appointed:
Horace S. H a w o r t h , Roberson, H a w o r t h & Reese, High
Point, N o r t h Carolina.
H a r r y S. Kissell, Kissell Companies, Springfield, Ohio.
H e n r y G. Zander, Jr., H e n r y G. Zander & Company,
Chicago, Illinois.
Robert E. Lee Hill, Missouri Bankers Association,
Sedalia, Missouri.
Ben A. Perham, P e r h a m F r u i t Company, Yakima,
Washington.
301
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 and valuation of new family dwelling units
provided in all urban areas in M a y 1945, by Federal Home Loan Bank District and by State
[Source: C. S. Department of Labor]
[Dollar amounts are shown in thousands]
All p r i v a t e 1- a n d 2-family s t r u c t u r e s
All residential s t r u c t u n?s
N u m b e r of family
dwelling u n i t s
Federal Home Loan B a n k District and State
Permit valuation
N u m b e r of family
dwelling u n i t s
Permit valuation
May
1945
May
1944
10, 923
$46,313
$33,301
10,436
176
1,237
500
320
124 J
90
22
60
2
2
170
13
222
6
826
302
48
145
1
4
35
6
74
3
202
46 j
14
60
2 i
2
370
59
1, 557
190
285
39
1,333
140
94
276
42
17
383
1,174
130 1
90
195
22
17
378
955
80
60
N o . 3—Pittsburgh
123
457
352
1,473 1
97
445
303
1,458
Delaware
Pennsylvania
W e s t Virginia
2
85
36
16
424
17
3
288
61
481,414
2
59
36
16
412
17
3
239
61
48
1,399
11
1,289
1,379
3,580
89
165
1,149
800
65
22
1,843
1,282
103
59
509
145
8
154
49
149
818
82
23
256
261
18
40
18
120
3,779
86
58
424
348
22
40
18
383
4,156
146
328
1,783
422
21
497
92
867
1,176
107
83
540
161
8
162
49
179
137
268
1,673
376
21
481
92
731
78
95
630
522
56
22
8
432
1,149
52
826
271
£08
45
611
252
5,332
122
4,478
732
3,533
75
2,677
781
797
44
490
263
802
41
509
252
3, 951
96
3,146
709
3,130
63
2,286
781
1,085
253
832
1,109
266
843
6,309
1,139
5,170
4,202
1,014
3,188
1,025
229
796
753
266
487
6,214
1,094
5,120
3,279
1,014
2,265
N o . 7—Chicago
Illinois
Wisconsin
717
405
312
751
692
59
3,218
1,847
1,371
3,217
2,966
251
542
743
688
55
2, 558
1,624
934
3,190
358
184
N o . 8—Des M o i n e s
Iowa...
Minnesota. . . .
Missouri
North Dakota
South Dakota
412
25
266
62
23
36
87
18
21
32
6
10
1,716
90
1,297
152
102
145
32
45
57
8
3
396
25
250
62
23
36
67
18
21
12
6
10
1,673
90
1,254
152
75
102
94
32
43
8
8
3
2,202
2,686
34
971
121
22
1,538
5,012
137
1,661
159
84
2,971
5,976
44
2,867
53
8
3,004
2,155
1,405
34
239
121
22
989
4,905
88
618
128
56
1,265
137
1,661
158
84
2.865
2,382
44
575
53
8
1,702
751
415
137
53
146
367
78
68
63
158
2,402
1, 434
292
222
454
1, 052
229
210
262
351
687
351
137
53
146
343
62
68
55
158
2,220
1,252
292
222
454
998
195
210
242
351
734
599
3,177
2,143
706
47
25
151
161
214
1
241
149
811
147
1, 731
98
140
119
506
590
787
1
60
38
198
51
340
19
557
47~
25
139
131
214
1
3,108
241
132
811
145
1,691
88
1,955
60
50
198
55
348
23
2, 345
30 1
2, 312 |
3
11, 845
476 I
11,235
134
7, 290
62
7, 218
10
2,250
117
2,100
33
9,483
439 1
8,910
134
6,126
62
6,054
10
U N I T E D STATES
N o . 1—Boston
Connecticut,
Maine
Massachusetts
New Hampshire
R h o d e Island
Vermont
..
N o . 2—New r Y o r k
N e w Jersey
New York
...
-..
.
N o . 4—Winston-Salem
Alabama
D i s t r i c t of C o l u m b i a
Florida
Georgia
Maryland
I
N o r t h Carolina
S o u t h Carolina
Virginia
N o . 5—Cincinnati
Kentucky
Ohio
Tennessee
..
N o . 6—Indianapolis
Indiana,
Michigan
..
_
...
._
.
.
...
.
. _
....
N o . 9—Little R o c k
Arkansas
Louisiana
M i s s i s s i p p i . __
.
N e w Mexico
. . . .
Texas
._.___._
N o . 10—Topeka
Colorado
Kansas
Nebraska
Oklahoma
N o . 11—Portland
Idaho
Montana
Oregon
Utah
Washington
Wyoming
N o . 12—Los Angeles
Arizona
...
California
Nevada
302
May
1945
May
1944
12,490
338
35
6
86
3
208
88
618
132
56
1,308
.
..
_
..
.
.
. . . . .
.
. ...
.
...
_
. . .
...
...
3,320
132
3,155
33
60 1
11 1
8
May
1945
May
1944
May
1945
7,937
1,841
30
1,808 i
3
$40,731
1,204
170
13
214 I
6
801
May
1944
$24, 953
358
193
16
144
1
4
2,948
242
140
119
447
460
788
1
Federal Home Loan Bank Review
Table 2 . — 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 and valuation of new family dwelling units
provided in all urban areas of the United States
[Source: U. S, Department of Labor]
[Dollar amounts are shown in thousands]
N u m b e r ot family d w elling u n i t s
April
1945
May
1945
P r i v a t e construction
.
..
1-family dwellings
2-family d w e l l i n g s '
...
3- a n d more-familv dwellings
1
1945
1944
May
1945
April
1945
May
1944
1945
1944
11, 207
9,530
9,743
39, 074
43, 375
$42, 920
$32, 722
$29.791
$127, 066
$136,930
7,062
864
1,604
6,981
956
1,806
31, 336
3,275
4,463
32, 680
4,510
6,185
37, 583
3,148
2,189
25, 767
2,546
4,409
21, 801
3,152
4,838
104, 422
10, 724
11,920
103, 669
15, 272
17,989
_
....
. . .
1,283
2,959
1,180
4,314
9,567
3,393
7,080
3, 510
5,789
22, 344
._
_
12, 490
12, 489
10,923
43. 388
52, 942
46, 313
39, 802
33, 301
132, 855
159, 274
Public construction. _
2
May
1944
January-May
totals
M o n t h l y totals
9, 503
933
771
2
Total urban construction.
January-May
totals
M o n t h l y tot lis
T y p e of construction
Permit valuation
Includes 1- and 2-family dwellings combined with stores.
Includes multi-family dwellings combined with stores.
Table 3 , — B U I L D I N G COSTS—Index of building costs for the standard house in representative
cities in specific months 1
[Average month of 1935-1939=100]
1945
1944
1943
1942
1941
1940
1939
June
June
June
June
June
F e d e r a l H o m e Loan B a n k District a n d c i t y
June
N o . 1—Boston:
Hartford, Conn.*...
P o r t l a n d , M a i n e *..
B o s t o n , Mass.*
M a n c h e s t e r , X . H.*
.
. _.
.
. . . .
N o . 4—Winston-Salem:
B i r m i n g h a m , Ala.* . . .
__ . .
Washington, D . C *
..
A t l a n t a , Ga.*
.
Baltimore, Md.*
... ...
R i c h m o n d , Va.*
.. _
N o . 7—Chicago:
Chicago, 111.*
M i l w a u k e e , Wis.*
N o . 10—Topeka:
D e n v e r , Colo.*
W i c h i t a , Kans.*
O m a h a , Nebr.*
O k l a h o m a C i t y , Okla.*
. . .
...
.
..
._
_
...
. . . . .
.
.
_
.
_ _
.
_. _
.
__
__.
Mar.
Dec.
Sept.
June
136.8
152.5
133.6
127.1
141.9
136.8
152.5
133.4
127.1
141.8
136.5
152.4
133.2
124.4
141.4
135.2
151.4
133.2
124. 2
139.7
135.1
148.2
132.8
120.0
138.6
128.2
134.7
126.9
114.3
128.7
128. 6
122.9
123.9
108.4
120.7
114.4
109v4
112.4
101.5
111.8
103.1
98.9
104.0
98.1
105.2
100.1
99.6
100.9
98.8
104.0
128.6
153.7
145.7
150.5
133.5
128.5
153.9
145.8
150.2
133.5
128.5
153.6
146.4
150.1
133.1
128.4
153.6
143.8
148.8
130.2
126.5
152.2
142.5
148.8
130.2
118.8
143.3
130.1
141.3
120.7
115.8
136.5
122.7
128.7
115.1
107.1
119.4
113.9
114.5
106.5
r
98.1
104.3
96.5
'103.9
95.7
r
98.1
102.9
95.5
r
100.8
98.0
113.0
144.4
112.8
142.3
112.8
142.4
112.4
142.1
112.4
142.3
109.9
131.5
107.1
124.4
100.3
114.3
99.6
108.4
100.6
107.0
128.2
136.7
137.3
151.4
128.0
135. 9
136.3
151.3
125.3
135.9
134. 5
151. 3
122.8
135.7
134.0
149.4
122.5
134.4
133.3
149.4
112.9
129.0
126.3
133.3
112.2
125.5
125.5
127.7
103.5
114.7
111.8
119.4
96.8
105.9
106.4
108.8
101.4
108.0
100.3
104.3
r
*Indexes of June 1941 and thereafter have been revised in order to use retail material prices collected by the Bureau of Labor Statistics.
Revised.
This index is designed to measure the changes in the costs of constructing a standard frame house and to provide a basis for the study of the trend of costs within an
individual community or in different cities. The various units of materials and labor are selected in accordance with their contribution to the total cost of the completed
dwelling.
Material costs are based on prices for a limited bill of the more important items. Current prices are furnished by the Bureau of Labor Statistics and are based on
information from a group of dealers in each city who report on prices for material delivered to job site, in average quantities, for residential construction. Because of
wartime conditions, some of the regular items are not available at times and, therefore, substitutions must be made of similar products which are being sold in the
current market.
Labor costs are based on prevailing rates for residential construction and reflect total earnings, including overtime and bonus pay. Either union or nonunion rates
are used according to which prevails in the majority of cases within the community.
Figures presented in this table include all revisions up to the present time. Revisions are unavoidable, however, as more complete information is obtained and
becomes available for inclusion in this table.
Cities in FHLB Districts 2, 6, 8, and 11 report in January, April, July, and October of each year; those in Districts 3, 5, 9 and 12 report in February, May, August
and November; and those in Districts 1, 4, 7 and 10 report in March, June, September and December.
r
1
July 1945
303
Table 4 . — B U I L D I N G COSTS—Index of building costs (or the standard house
[Average month of 1935-1939=100]
M a y 1945 A p r . 1945 M a r . 1945 Feb.1945 J a n . 1945 D e c . 1944 N o v . 1944
E l e m e n t of cost
Material
Labor
__
Total
p
Oct. 1944 Sept. 1944 A u g . 1944 J u l y 1944 J u n e 1944 M a y 1944
132.3
140. 5
132.1
' 140. 6
r 132. 1
' 140.3
131.9
140.1
131.7
140.1
131.5
140.0
131.5
139.9
131.3
139.1
131.2
138.5
131.3
137.3
131.0
137.3
130.7
137.5
lc0.3
137.3
135.0
' 135.9
134.8
' 134.7
134.5
134.4
134.4
133.9
133.7
133.3
133.1
133.0
132.7
Revised.
Table 5 . — B U I L D I N G COSTS—Index of wholesale prices of building materials in the United States
[Source: U. S. Department of Labor]
[1935-1939=100; converted from 1926 base]
All b u i l d i n g
materials
Period
1943: M a y
1944: M a y
June
July
August
September
October
November
December..
.._
_
__
_
1945: J a n u a r y
February
March
April
May
.__
.
__.
_
. _
. .
Percent chance:
M a y 1945-April 1945
M a y 1945-May 1944
r
__
_
._..
.
Brick a n d
tile
Paint and
paint materials
Lumber
Cement
Plumbing
and heating
Structural
steel
Other
123.4
108.8
103.1
' 153.8
125.7
118.8
103.5
109.7
129.2
129.4
129.4
129.5
129.5
129.9
130.0
130.0
110.6
110.7
110.8
110.8
111.7
115.3
115.6
115.9
105.8
105.8
105.8
105.8
106.3
107.0
107.2
107.0
171.5
171.5
171.7
171.9
171.5
171.3
171.3
171.3
128.7
130.0
129.7
129.7
129.7
130.3
130.7
130.7
121.4
121.4
121.4
121.4
121.4
121.4
121.4
121.4
103.5
103.5
103.5
103.5
103.5
103.5
103.5
103.5
111.4
111.4
111.5
111.6
111.7
111.7
111.7
111.7
130.4
130.6
130.8
130.8
131.0
121.5
121.6
121.8
121.7
121.8
106.9
108.7
109.1
109.1
109.1
171.3
171.4
171.3
171.4
171.9
130.7
130.8
130.7
130.7
130.8
121.4
121.4
121.4
121.4
121.4
103.5
103.5
103.5
103. 5
103.5
111.9
112.0
112.3
112.3
112.6
+0.2
+1.4
+0.1
+10.1
0.0
+3.1
+0.3
+0.2
+0.1
+1.6
0.0
0.0
0.0
0.0
+0.3
+1.1
Revised.
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]
P u r p o s e of loans
Class of association
Period
1943
Home purchase
Refinancing
$106,497
$802,371
$167,254
$30,441
$77,398
$1,183,961
$511,757
$539,299
$132,905
39,231
260,053
68,675
11,087
28,544
407, 590
172, 358
185,959
49, 273
9,039
67,826
14, 843
2,606
6,176
100, 490
41, 835
47, 818
10,837
95,243
1,064,017
163,813
30,751
100,228
1,454,052
669,433
648,670
135,949
49,016
387, 424
64, 259
11, 393
38, 346
550,438
251, 377
244,634
54,427
.
7,338
9,663
7,078
7,589
5,923
6,095
4,635
5,244
98,872
103, 276
93,232
105,050
101,884
101,461
90,182
81,508
14,415
14,963
13,871
14,152
14,495
15,253
13,265
13,555
2,967
2,957
2,841
3,067
3,160
2,699
2,507
2,127
8,931
9,850
8,014
8,816
8,993
9,720
7,785
8,704
132,523
140,709
125,036
138,674
134,455
135,228
118,374
111,138
59,229
64,474
57,164
64,400
63,489
61,965
54,978
51,586
60,141
63,851
56,639
61,377
59,162
60,945
52,241
49,921
13,153
12,384
11,333
12,897
11,804
12,318
11,155
9,631
.._
36,832
493,870
73,300
12,768
49, 854
666,624
312, 751
293, 591
60, 282
3,772
3,081
,7,406
'9,541
13,032
76,495
78,140
105,307
113,684
120, 244
12,167
12,524
15,922
16,800
15,887
1,868
1,994
2,559
2,951
3,396
7,999
10,270
10,287
10, 778
10, 520
102,301
106,009
141,481
153, 754
163,079
46,439
49,900
69,430
71,375
75, 607
46,452
46,575
60,688
67,955
71,921
9,410
9,534
11,363
14,424
15,551
:
May
.- -
1944
. .
_.
January-May
May.
June
July..
August
September
October
November
December...
_
_
__
_
_
___
_
1945
J a n u a r y - M a y . .._ . January
February
March
April
May
304
._
_
_
L o a n s for
all o t h e r
purposes
Construction
_
January-May _
Reconditioning
Total
loans
Federals
State
members
Nonmembers
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
MAY 1945
[Thousands of dollars!
[Dollar amounts are shown in thousands]
C u m u l a t i v e n e w loans
(5 m o n t h s )
N e w loans
Federal H o m e Loan
B a n k District and
class of association
May
1945
fed
Federal
State m e m b e r . .
Nonmember
Boston
Federal-.
State m e m b e r
Nonmember
__
New York
Federal
State m e m b e r . . .
Nonmember
Pittsburgh..
Federal
State member
Nonmember
Winston-Salem
Federal
State member
Nonmember
Cincinnati
Federal .
State member
Nonmember..
. __
__
Federal
State member
Nonmember
Chicago
Federal..
State member
Nonmember..
.
Federal.. .
State m e m b e r . . Nonmember.Little Rock
F e d e r a l . . __ . . .
State member
Nonmember
...
._ _
Topeka Federal-.
State m e m b e r
Nonmember..
Portland
May
1944
1945
Percent
change
1944
+21.1
$163,079 $153, 754 $132, 523 $666, 624 $550,438
U N I T E D STATES
Indianapolis.
April
1945
.
.
Federal
.
State m e m b e r . _ _
Nonmember
___
Los Angeles
F e d e r a l __ . _.
_ __
State member. _ _
July 194S
75, 607
71, 921
15,551
71, 375
67,955
14, 424
59,229 312, 751 251, 377
60,141 293, 591 244, 634
13,153 60, 282 54, 427
+24.4
+20.0
+10.8
11,782
11, 384
10, 439
43. 434
36,880
+17.8
4,940
5,242
1,600
4,118
5,791
1,475
3,757
5,431
1, 251
17, 746
20, 524
5,164
12, 807
19,050
5,023
+38.6
+7.7
+2.8
17, 680
15, 062
11,964
63, 811
43, 490
+46.7
6,263
7,990
3,427
5, 491
6,913
2,658
3,551
6,115
2,298
22, 334
30,141
11, 336
12,134
23,292
8,064
+84.1
+29.4
+40.6
14, 989
13, 674
10, 534
56, 773
46, 290
+22.6
6,655
5,272
3,062
6,271
4,757
2,646
4,915
3,557
2,062
26,124
19, 911
10, 738
21, 253
15, 096
9,941
+22.9
+31.9
+8.0
19, 868
18, 721
14, 904
83, 227
66, 979
+24.3
10, 433
8,366
1,069
9,800
7,840
1,081
7,965
6,026
913
44, 450
34, 206
4,571
36, 348
26, 694
3,937
+22.3
+28.1
+16.1
27, 445
27, 011
24, 806 110, 245
93, 719
+17. 6
11, 963
13, 673
1,809
11, 576
13, 419
2,016
9,990
12, 520
2,296
47, 829
54,849
7,567
37, 723
47, 452
8,544
+26.8
+15.6
-11.4
9,475
8,530
7,387
38,116
30, 362
+25.5
5,149
3,860
466
4,553
3,478
499
3,509
3,496
382
20, 010
16,150
1,956
14, 559
14, 358
1,445
+37.4
+12.5
+35.4
17, 982
18, 555
15, 550
75, 474
61, 648
+22.4
7,555
9,124
1,303
7,949
8,984
1,622
6,315
7,922
1,313
31, 787
37, 535
6,152
25, 456
30, 595
5,597
+24.9
+22.7
+9.9
9,157
8,835
8,553
39,116
32, 923
+18.8
4,951
3,151
1,055
4,661
3,239
935
4,449
2,960
1,144
19, 784
14,183
5,149
16,156
12,162
4,605
+22. 5
+16.6
+11.8
7,276
6, 267
6,476
33,184
32, 203
+3.0
3,405
3,751
120
3,193
2,994
80
3,134
3,275
67
16,311
16, 423
450
12, 981
18, 862
360
+25.7
-12.9
+25.0
7,682
7,165
6,364
34,916
26, 787
+30. 3
4,050
2,257
1, 375
3,790
2,187
1,188
3,369
1,796
1,199
18, 543
10, 380
5, 993
13, 646
7,355
5,786
+35. 9
+41.1
+3.6
5,805
5,054
4,264
23, 761
17, 203
+38.1
2,987
2,648
170
3,077
1,857
120
2,805
1,309
150
14, 394
8,602
765
11, 781
4,740
682
+22. 2
+81. 5
+12. 2
13, 938
13, 496
11, 282
64, 567
61, 954
+4.2
i
7,256
6,587
95
6,896
6,496
104
5,470
5,734
78
33, 439
30, 687
441
36, 533
24,978
443
-8.5
+22.9
-0.5
Savings I n s u r - B a n k s M u tual
and
Federal H o m e Loan
and
ance
trust
savBank District
loan
comings
and State
associa- panies companies b a n k s
tions
Individuals
Other
mortgagees
Total
$172,421 $21, 459 $91,023 $18, 981 $125, 849 $57, 702 $487, 435
U N I T E D STATES
Boston
Connecticut.
Maine
Massachusetts
New Hampshire
Rhode Island
Vermont
New York
New Jersey.
N e w York
Pittsburgh—
14, 593
575
4,474 10, 074
7,125
2,832
39, 673
1,726
698
10,174
394
1,337
264
401
26
132
16
1,880
273
1,579
173
478
91
1,748
810
5,976
686
458
396
2,184
591
3,055
346
675
274
868
72
1,386
54
420
32
8,807
2,470
22, 302
1,669
3,368
1,057
15,113
1,958
7,731
6,478
19, 279
6,212
56, 771
4,262
10, 851
782
1,176
3,484
4,247
857
5,621
4,761
14, 518
2,120
4,092
16, 266
40, 505
14, 832
2,133
8,310
631
7,398
3,500
36,804
Delaware
Pennsylvania
W e s t Virginia
214
13, 524
1,094
142
1,799
192
175
6,710
1,425
31
600
252
6,360
786
91
3,233
176
905
32, 226
3,673
W i n s t o n - S a l e m _.
16, 694
2,883
5,746
120
17, 989
4,435
47,867
650
2,774
2,200
1,898
4,277
2,438
459
1,998
251
349
627
245
178
564
217
452
395
551
933
1,171
707
503
449
1,037
1,006
2,563
6,702
1,407
1,927
1,311
728
2,345
369
462
1,027
651
206
670
354
696
2,671
6,699
11, 489
5,372
7,415
5, 486
2,207
6,528
Alabama
D i s t r i c t of C o l u m b i a Florida - _.
._- .
Georgia
Maryland
N o r t h Carolina
~
- S o u t h Carolina
Virginia
_
120
Cincinnati-.
34, 420
627
7,294
5,072
61, 319
Kentucky
Ohio
Tennessee
3,189
30, 369
862
383
914
899
1,131
9,397
1,182
627
421
6,225
648
152
1,793
3,127
5,276
49, 325
6,718
Indianapolis
10,114
2,095
8,445
42
4,144
1,719
26, 559
Indiana.
Michigan.
6,353
3,761
810
1, 285
3, 231
5,214
42
1,491
2,653
777
942
12, 704
13,855
19,823
950
6, 616
14
8,263
9,434
45,100
15, 429
4, 394
697
253
4,052
2,564
14
4,944
3,319
8,792
642
33, 914
11,186
10,172
2,051
7,912
241
6,250
5,189
31,815
2, 530
3,628
3, 500
302
212
221
386
1,421
18
5
1,878
1,827
3,931
71
205
991
1,563
3,363
173
160
327
1,393
3,400
58
11
5, 947
9,038
15, 615
622
593
8,874
2,595
2,261
8,176
3,228
25,134
681
2,452
447
163
5,131
120
253
125
12
2,085
347
200
249
129
1,336
472
1,714
496
284
5, 210
68
435
147
11
2,567
1,688
5,054
1,464
599
16, 329
8,205
934
2,365
5, 869
2,408
19, 781
1,310
2,193
1,386
3,316
117
120
389
308
489
913
240
723
2,850
632
624
1,763
1,377
254
116
661
6 143
4,112
2,755
6, 771
5,214
562
3,914
4, 363
2,163
16, 970
395
329
1,257
513
2,596
124
60
21
291
123
66
1
254
97
419
609
2,272
263
490
358
1,637
358
1,211
309
83
20
219
153
1,673
15
1,282
825
3,851
1 756
8,544
712
Chicago _Illinois
Wisconsin.
Des M o i n e s
_
Iowa.
Minnesota
|
North Dakota
South D a k o t a
Little R o c k
A r k a n s a s . __
__
Louisiana ._
Mississippi
_ __ __
N e w Mexico
Texas.
_
Topeka.
Colorado
Kansas
N e b r a s k a ___ .
O k l a h o m a _ . . . ___
Portland
Idaho
_Montana
Oregon
Utah
Washington
Wyoming
Los Angeles
Arizona
__
California
N e v a d a ._ _ _.
_
2,196 11, 710
241
754
28
726
14, 367
2,527 21, 539
29, 699 11, 510
79, 642
509
13, 754
104
668
9
2,516 20, 715
156
2
1,379
48
27, 983 11, 450
337
12
2,613
76, 418
611
305
Table 9 — M O R T G A G E R E C O R D I N G S - E s t i m a t e d volume of nonfarm mortgages recorded
[Dollar amounts are shown in thousands]
Savings a n d loan
associations
Banks and trust
companies
Insurance
companies
M u t u a l savings
banks
Indivi iuals
O t h e r mortgagees
All mortgagees
Period
Total
1944
yanuary-May
May.._
June
July
August
September
October
November
December
Percent
Percent
Total
Total
Percent
Total
Percent
Total
Percent
Total
Percent
Total
Percent
$1,563,678
33.9
$256,173
5.6
$877, 762
19.0
$165,054
3.6 $1,134,054
24.6
$613,908
13.3
$4,610,629
100 0
579,979
139, 748
145,893
138, 762
149, 835
146,151
148,131
134, 359
120, 568
33.1
34.5
34.6
33.7
34.8
35.1
35.0
34.1
33.5
103,463
21, 794
22. 215
24,707
22,646
22,432
20,985
20, 543
19,182
5.9
5.4
5.3
6.0
5.2
5.4
5.0
5.2
5.3
344,617
79,083
79, 453
80, 858
83, 094
77,000
76,181
71, 752
64, 807
19.6
19.. 5
18.8
19.7
19.3
18.5
18.0
18.2
18.0
57,500
14, 882
15, 536
15, 261
15, 920
15, 447
16, 552
15,176
13,662
3.3
3.7
3.7
3.7
3.7
3.7
3.9
3.9
3.8
419,178
95, 730
99,140
98,194
104,215
104,479
109, 767
103,513
95, 568
23.9
23.6
23.5
23.9
24.2
25.1
26.0
26.3
26.5
249,459
53,858
59, 394
53,354
55, 066
50, 676
51, 223
48,296
46, 440
14.2
13.3
14.1
13.0
12.8
12.2
12.1
12.3
12.9
1, 754,196
405, 095
421, 631
411,136
430, 776
416,185
422, 839
393, 639
360, 227
100 0
100.0
100.0
100. 0
100.0
100 0
100 0
100.0
100.0
703,619
111,480
111, 176
151,361
157,181
172,421
34.0
31.4
32.8
34.9
34.5
35.4
95,762
17,882
16, 034
20, 669
19,718
21, 459
4.6
5.0
4.7
4.8
4.3
4.4
388,814
65,109
63, 933
80, 000
88, 749
91,023
18.8
18.4
18.9
18.5
19.5
18.7
71,103
12, 500
10, 343
13, 599
15,680
18, 981
3.4
3.5
3.1
3.1
3.4
3.9
551,981
99, 200
93, 248
114,971
118, 713
125, 849
26.7
28.0
27.5
26.5
26.1
25.8
258,558
48,407
43,963
52, 737
55, 749
57, 702
12.5
13.7
13.0
12.2
12.2
11.8
2,069,837
354, 578
338,697
433, 337
455, 790
487, 435
100.0
100.0
100.0
100.0
100.0
100.0
1945
J a n u a r y - M a y _.
January
February
March
April
._ _
May
-_
Table 1 0 — S A V I N G S — S a l e s of war bonds 1
Table 1 1 . — F H A — H o m e mortgages insured
[Thousands of dollars]
Series E
Period
[Premium paying; thousands of dollars]
Series G
Series F
Total
Redemptions
Title I I
Title V I
(603)
Period
1944
May
June
July
August
September
October _November
December
1945
January...
February
March
April
May
-
.
$2,891,427 $16,044,085
New
$13, 263,168
$12,379,891
$772,767
624,253
1, 349,794
1,686, 509
499,357
590, 827
598, 570
806,817
1, 855,300
15,287
115,119
101,082
17, 807
15,953
13,653
42,680
124,669
111, 088
377,284
337,459
85, 272
85, 286
82, 871
173, 858
405,880
750,628
1, 842,197
2,125,050
602, 436
692,066
695,094
1,023,355
2,385,849
271,597
241, 278
220,145
272,125
277,445
394, 846
376, 053
358, 572
803,819
653, 222
712,133
684,424
1,194, 712
42,034
30,695
26,487
23,112
62,940
228,327
164,073
150, 456
130,100
282, 437
1,074,180
847,990
889,076
837,636
1,540,089
333,443
317,083
437,892
381,198
404, 209
i U. S. Treasury War Savings Staff.
the TJ. S. Treasury.
l
Actual deposits made to the credit of
1944: May
June
J u l y . . . ....
August
September
October--.
November.
December.
$81
81
82
90
79
40
54
31
1945: J a n u a r y . . .
February..
March
April
May
Existing
Total
insured
at end of
period
$18,319
17,768
18,322
20, 256
19, 967
21, 941
21, 646
18, 269
$37, 739
34, 238
42,322
48,166
42, 592
43,354
38,053
36, 573
$5,600,636
5, 652, 723
5, 713,449
5,781,961
5, 844, 599
5, 909, 934
5, 969, 687
6, 024, 560
19,006
14,085
16,480
14,813
22,272
38, 640
31,417
29,886
26,885
23,707
6,082, 273
6,127, 802
6,174,205
6,215,966
6,262,025
i Figures represent gross insurance written during the period and do not take
account of principal repayments on previously insured loans.
Table 1 2 . — F H L B A N K S — L e n d i n g operations and principal assets and liabilities
[Thousands of dollars]
L e n d i n g operations,
M a y 1945
Federal H o m e Loan Bank
Advances
Boston
..
Pittsburgh
Winston-Salem
Little Rock
Portland
-
$653
180
659
988
249
290
1,173
775
160
20
0
1,160
Repayments
P r i n c i p a l assets, M a y 31, 1945
Advances
outstanding
Cash i
Governm e n t securities
C a p i t a l a n d p r i n c i p a l liabilities.
M a y 31, 1945
Capital 2
Debentures
Member
deposits
Total
assets,
M a y 31,
1945 1
$43
437
848
642
877
526
1,318
252
306
441
95
1,638
$7,029
3,168
6,253
3,587
1,936
4,473
9,357
2,178
3,051
2,481
10
7,401
$783
784
3,264
1,111
3,260
1,179
2,472
748
2,066
1,834
861
5,113
$16,035
54, 202
16, 875
14, 217
46, 806
22, 394
23,938
22, 855
10, 218
8,222
11, 462
24, 705
$20,294
28, 070
17, 076
18,069
27,240
14, 917
23,399
13, 540
12, 609
10,957
8,702
16, 430
$2, 000
5,000
5,500
0
2,500
5,000
6,000
8,500
2.000
1,000
2,000
10, 500
$1,609
25, 245
3,893
926
22, 576
8,281
6, 513
3,813
802
634
1,695
10, 372
$23, 947
58, 367
26, 504
18, 998
52,355
28, 223
35, 936
25, 885
15, 420
12, 595
12,405
37, 359
M a y 1945 (combined t o t a l ) .
6,307
7,423
50, 924
23, 475
271,929
211, 303
50,000
86, 359
347, 994
A p r i l 1945
M a y 1944
3,061
3,939
12,079
14, 978
52, 040
71, 606
18, 543
31,997
264,198
194, 845
210, 295
203, 214
50,000
64, 300
75, 465
29, 270
336,036
299, 623
i Includes interbank deposits.
306
!
Capital stock, surplus, and undivided profits.
Federal Home Loan Bank Review
Table 13.—INSURED
ASSOCIATIONS-
Progress of institutions insured by the FSLIC
[Dollar a m o u n t s are s h o w n in t h o u s a n d s ]
Opera tions
Number of
associations
P e r i o d a n d class
of association
Total
assets
New
New
private
m o r t g a g e investloans
ments
Private
repurchases
$97,454 $109,049
105, 245 127,945
93,305 , 155, 218
104, 008 126,641
101,658 122,016
100,642 129,938
88, 227 115,008
83, 408 142,291
$44,403
46, 560
120, 349
64,619
56,102
54, 719
52,378
45,985
40.7
36.4
77.5
51.0
46.0
42.1
45.5
32.3
Repurchase
ratio
75 percent of all non-agricultural employment other
than Government and railroads). However, the
end of the war is expected to bring a reversal of the
trend over this period, largely because a number of
small businesses (largely distributive) which disappeared after Pearl Harbor are planning to reopen.
k DIRECTORY
P CHANGES
ALL INSURED
1944: M a y
J u n e _.
July
August _
September
October
November.
December. _
2,459
2,461
2,463
2,461
2,460
2,462
2,462
2,466
$4,442,608
4, 583, 568
4,619, 867
4, 667, 060
4, 713,815
4, 774,160
4,867,068
5,012,662
1945: J a n u a r y
February
March
April
May
2,466
2,463
2,465
2,469
2,469
5,035, 626
5, 076, 554
5,136,903
5, 204, 641
5,292,169
76, 215
79,479
110, 287
113, 296
121, 808
195,077
125,769
138, 709
133,651
130,182
123,943
63,089
71,488
65, 701
62, 980
63.5
50.2
51.5
49.2
48.4
1,466
1,465
1,466
1,465
1,464
1,465
1,464
1,464
2,775,665
2,881,276
2,907,974
2,934, 647
2,961,860
3,000, 365
3, 059, 556
3,168, 731
59, 229
64,474
57,164
64,400
63,489
61, 965
54,978
51, 586
72,413
83,856
101, 500
82,105
79,126
85, 297
75,372
93,400
27, 676
25,969
79, 735
40, 825
35, 570
33, 746
32, 665
26,049
38.2
31.0
78.6
49.7
45.0
39.6
43.3
27.9
MAY 16—JUNE 15, 1945
K e y to C h a n g e s
*Admission to M e m b e r s h i p in B a n k S y s t e m
* t e r m i n a t i o n of M e m b e r s h i p in B a n k System
#Federal C h a r t e r G r a n t e d
##Federal C h a r t e r Canceled
01nsurance Certificate G r a n t e d
001nsurance Certificate Canceled
FEDERAL
1944: M a y
June
July
August
September
October
November
December
1945: J a n u a r y
February
March
April
May
_
-.
1,464
1,464
1,465
1,465
1,466
3,178,132
3,200,324
3.237.942
3, 280, 506
3,337,648
46,439
49,900
69,430
71,375
75,607
129, 640
82, 862
91, 627
88,356
85,977
84,624
41, 374
46, 574
41, 856
40,063
65.3
49.9
50.8
47.4
46.6
1945: J a n u a r y . .
February
March..
April.
May
Ware:
*Ware Savings B a n k , B a n k Street.
DISTRICT N O . 2
N E W JERSEY:
Camden:
#Union F e d e r a l Savings a n d L o a n Association, 107 N o r t h 6th S t r e e t .
Elizabeth:
**Security B u i l d i n g a n d L o a n Association of E l i z a b e t h , 715 E l i z a b e t h
Avenue.
NEW
YORK:
Ilion:
*Ilion Savings a n d L o a n Association, 10 E a s t M a i n Street.
STATE
1944: M a y
June
July
August-.
September
October
November
December
DISTRICT N O . 1
MASSACHUSETTS:
_.
_
_.
993
996
997
996
996
997
998
1,002
1.666.943
1,617,971
1, 711,893
1,732,413
1, 752,015
1, 773, 795
1, 807, 512
1,843,931
38, 225
33,280
36,141
39, 608
38,169
38, 677
33, 249
31,822
36,636
36,218
53, 718
44, 536
42,890
44, 641
39,636
48, 891
16, 727
20, 511
40, 614
23, 794
20, 532
20,973
19, 713
19,936
45.7
56.6
75.6
53.4
47.9
47.0
49.7
40.8
1,002
999
1,000
1,004
1,003
1,857,494
1, 876, 230
1, 898, 961
1,924,135
1,954, 521
29, 776
29, 579
40, 857
41, 921
46,201
65,437
42, 907
47, 082
45, 295
44,205
39, 319
21, 715
24, 914
23, 845
22,917
60.1
50.6
52.9
52.6
51.8
DISTRICT N O . 3
PENNSYLVANIA:
Philadelphia:
* * G e r m a n t o w n Building a n d L o a n Association, 5606 G e r m a n t o w n A v e n u e .
Pittsburgh:
**Kordecki B u i l d i n g a n d L o a n Association, 3101 B r e r e t o n A v e n u e .
*0Pennsylvania Savings a n d L o a n Association of P i t t s b u r g h , 860 Spring
Garden Avenue.
DISTRICT N O . 4
FLORIDA:
Melbourne:
# F i r s t F e d e r a l Savings a n d L o a n Association of B r e v a r d C o u n t y .
DISTRICT N O . 6
INDIANA:
Terre H a u t e :
00 T w e l v e P o i n t s Savings a n d L o a n Association, 1279 M a p l e A v e n u e .
Small Business and Employment
DISTRICT N O . 7
ILLINOIS:
•
I N 1939, the year war broke out in Europe,
small business—here arbitrarily set as those
establishments employing less than 50 people—accounted for the employment of approximately
8,000,000 persons and the livelihood of 2,000,000
business men, according to the Department of Commerce. In other words, they accounted for about
one-third of all wage and salary earners in all industries other than agriculture, Government and the
railroads. Firms employing from one to three
persons accounted for 7 percent of that figure.
Studies conducted by the Department show that
the war brought with it a shift in the concentration
of employment by business size group (large firms
percent in 1939 gained to
July 1945
E a s t St. L o u i s :
##00 St. Clair Federal Savings a n d L o a n Association, 517 Missouri A v e n u e .
DISTRICT N O . 9
TEXAS:
Corpus Christi:
**First F e d e r a l Savings a n d L o a n Association of C o r p u s C h r i s t i , M e s q u i t e
at Peoples Streets.
Corpus Christi:
*0 F i r s t Savings a n d L o a n Association of C o r p u s C h r i s t i , M e s q u i t e a t
Peoples Streets.
DISTRICT N O .
12
CALIFORNIA:
Richmond:
i n d u s t r i a l Savings a n d L o a n Association, 1301 M a c D o n a l d A v e n u e .
NATIONAL HOUSING AGENCY
John B. Blandford, Jr., Administrator
FEDERAL HOME LOAN BANK ADMINISTRATION,
John H. Fahey, Commissioner
307
•
CONSTRUCTION
AND
*
INCOME:
"Construction is dependent for its
markets on the incomes which go with
a high level of productive employment.
This can be strikingly illustrated in
housing. There were more nonfarm
households in 1940 than in 1930 and
total consumer income was slightly
smaller so that the average income per
family was substantially less. There
were many more families in lower income groups who could afford to pay
less for housing. The result was a
large increase in the families living in
houses with a rental value of $40 or
less and large decreases in those occupying a dwelling at more than $40 a
month. This downward shift in the
effective demand was a dominant influence limiting new residential construction between 1930 and 1940.
" Given somewhere near the present
family income after the war, or the
income which might be associated with
full employment, there would be an
€ven greater shift in the opposite
direction. The increased demand for
houses having a rental value of over
$40 per month would support a high
rate of new construction for some
years. At the same time the shrinkage in demand for dwellings with a
rental value of less than $30 would
force the retirement of many undesirable dwellings because they would
have no market."
Henry A. Wallace, Secretary
of Commerce, before Senate
Special Committee on Small
Business,
POTENTIAL
SPENDING
POWER:
"The first ten-year period of FHA
operations was one of gradually building up from a depressed market,
starting at a time when the timidity
of investment capital caused mortgage
funds to be even more scarce than the
product they financed.
"The coming period, on the other
hand—the one immediately f a c i n g
us—while low on available properties
will be characterized by an abundance
of funds seeking investment—funds in
the coffers of financial institutions,
funds represented by war bonds, funds
in the pockets of individuals, funds in
the form of Government-guaranteed
loans to discharged veterans.
"This generous supply of capital—
of potential spending power—and the
308
* Worth Repeating *
scantiness of purchasable real estate
creates an entirely new set of circumstances in the market to be faced by
the FHA and the financial institutions
operating under the program. Unless*
recognized and met wisely now, they
may presage another and worse
depression which could aggravate and
uselessly complicate the FHA's ability
to carry out the mandate of Congress
to stabilize the mortgage and real
estate markets."
Abner H. Ferguson in summary
of FHA operations for 1944.
RESEARCH: "The best promise of
better housing at less cost lies in largescale operation and in a coordinated
and imaginative job of research—not
jigsaw-puzzle research, but integrated
research that goes across the board.
"That is a big job, not a piecemeal
job. It is such a big job that it can be
done only if we all work together on it.
But it will have to be done if we are to
contribute the most we can to postwar
prosperity for everybody and to a
better way of life in postwar America.''
Senator Harley M. Kilgore,
Housing Progress, First Quarter
1945.
RESERVES: "In addition to the pursuance of realistic appraisal policies
and the making of all mortgage loans
within safe percentages of sound,
stabilized values, we should also be
thinking in terms of greatly strengthened reserves. In this connection, it
is recognized there has been a definite
trend toward reduction in the rate of
dividends paid by associations during
the past few years. However, due to
the growth of associations generally
such reductions have but little more
than kept pace with the declining
earning power of association assets
and increased operating costs, with the
result that reserve structures have not
been materially enhanced in relation
to acquisition of assets bearing the
element of loss risk."
Ralph H. Richards, Third District Quarterly, First Quarter
1945.
RESPONSIVE TAX SYSTEM: "Ease of
administration and compliance is a vital
consideration in devising postwar taxes.
Simple and uniform laws are the best
bulwark against expensive administration and costly and irritating compliance
*
•
burdens. Much progress has been made
in the direction of simplification, but
much remains to be done. In attempting simplification, however, one is
forcibly reminded that the demands of
equity in the tax system set a limit
beyond which simplification cannot go.
Thus, one criterion of a well-designed
tax system may clash with another,
and the tax designer is charged with
the task of reconciling the two.
"Stability in the postwar tax system
is another widely desired end. But
it is important to distinguish between
stability in structure and stability in
rates. The tax system should be
responsive to changes in economic
conditions. Taxation is an instrument
designed to serve organized society.
If it is to be of maximum service, it
must be adapted to the changing
economic and social needs of that
society."
Roy Blough, before the Buffalo
Chamber of Commerce, Buffalo,
New York, May 18, 1945.
POSTWAR BOOKSHELF
Although inclusion of title does not necessarily mean recommendation by the
REVIEW, the following recent publications
will be of interest.
THE AMERICAN
LEGION PROGRAM FOR MAXIMUM
EMPLOYMENT: Available from The National
Employment Committee, The American Legion, 1608 K Street, N. W.,
Washington, D. C.
INTERNATIONAL
MONETARY
COOPERATION:
By George N.
Halm. Available at $4 from University of North Carolina Press, Chapel
Hill, N. C.
PLANNING:
No. 230: Government
Information Services. Available at
250 from The New Republic, 40 East
49th Street, New York, 17 N. Y.
ORGANIZATION
AND
P R 0 GRAMS
FOR CITIZEN
PLANNING GROUPS: Bibliography issued
by the American Society of Planning
Officials, 1313 East 60th Street,
Chicago, 111. Available at 10c.
TOMORROW'S
BUSINESS:
By
Beardsley Ruml. Available at $2.50
from Farrar and Rinehart, 232 Madison Avenue, New York 16, N. Y.
U. S . GOVERNMENT PRINTING O F F I C E : 1 9 4 5
@FedFRASER