Full text of G.20 Sales Finance Companies : July 5, 1946
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BOARD OF GOVERNORS OF THE FEDERAL RESERVE SYSTEM July 6, 1946 G.20 SALIS :rilWICB COIIP.ABDS YAY 1946 Retail financing.--The volume of automotive and other retail financing in ~y was higher than in April, and outstanding balances on both classes of paper continued to increase. The rise of 10 per cent in total automotive financing, shown in the table below, reflected gains in the volume of all classes of retail automotive paper purchased, except used car paper. New passenger car financing continued to rise sharply, and constituted about 20 per cent of the dollar volume of aut0111.otive paper acquired in May compared with 16 per cent in April. Retail financing of consumers' goods other than automotive was 9 per cent higher than that of the preceding month. The decrease in volume of paper arising from n1iscellaneous retail sales was more than offset by substantial increases in all other types of diversified financing. Retail Financing by Sales FiDanoe Companies .llat Percentage cham;e. April 1946 to 1946 Number volume of paper Oufstanding balances, end of month acquired during month of cars Class of retail instalment paper Automotive ' + 7 -+54 - 4 Passenger oars: Commercial oars: Other consumers' goods: New Used New Used Total retail I + 10 -- +102 Total retail + 94 + 17 + 6 Furniture, radios, musical instruments Refrigerators and other household appliances Residential building repair and modernization Kisoellaneous retail + 10 + 40 - 4 + -9 + 12 + 16 + 13 - 4 I ... ... ... ... + 12 ... ... ... ... Wholesale finanoing.--The volume of wholesale automotive financin~ in May was more than one-fourth larger than ti1at of a month earlier, but outstanding balances showed only a small rise. The decline of 2 per cent in wholesale .financing other than automotive was accompanied by a small increase in outstanding balances. Ratio of paper ao~uired to balances outstanding.--With reference to total sales financing, the rise in kay from 40 to 43 per cent in the ratio of paper acquired during the month to balances outstanding at the end oflthe month reflected the increased ratio for wholesale automotive credit. The volume of wholessle automotive psper acquired during the month averaged about 168 per cent of ,the corresponding amount outstanding at the end of the month. The ratio for other wholesale finan' cing was only 42 per cent, indicating a much more rapid rate of turnover for wholesale automotive credit than for the nonautomotive type. Note: Indexes of automotive and diversified financing forn~rly shown as Table 3 of this report have been discontinued until they can be revised to a new base representative of postwar conditions. The base fonnerly used (January 1942) is unsatisfsctory for measuring current trends. Page 2 SALES FINANCE COJIPA:tliES Table I.--Automotive 'and Di va'rsif'ied Financin:g· by Sales Finance Companies Indexes of Outstanding Bale.noes1 · December 31, 1939 • 100 !/ Wholesale other than automotive Retail other COnS\UII8rS 1 goods Industrial, commercial, and farm equipment End of month and ~ar Total all sales financing 1939 •. ...•.••.•••••••• 100 100 100 100 100 100 1940 •••••••••••••••••• 136 132 169 140 129 131 1941 •••••••••••••••••• 152 149 175 250 148 147 1942 •••••••••••••••••• 53 37 ll2 40 76 61 1943 •••.•••••••••••••• 20 13 40 8 30 27 1944 •••••••••••••••••• 18 15 24 ll 26 26 1946 •••••••••••••••••• 22 18 27 38 39 23 1946- Kay •••••••••••• 18 18 18 18 18 19 21 22 14 14 15 15 15 16 17 18 25 24 20 18 17 18 24 27 16 16 16 19 21 28 32 38 28 29 30 31 33 35 37 39 28 27 27 25 24 24 24 23 44 49 56 68 41 44 46 51 June ••••••••••• July •••••••••· •• J.ugust ••••••••• September •••••• October •••••••• November ........ December ••••••• Retail automotive Wholesale automotive 25 27 32 March·•••••••••• 35 April ••••• ·•••• f>7 bv, 37 71 31 24 36 Indexes as of December 31 for the years of 1939, 1940, and 1941 are based on figures reported by sales finance companies on a supplementary report form which accompanied the regular montllly report form for January 1942. Succeeding indexes are derived by calculating the percentage changes of the outstanding balances reported by sales finance companies for each month from those reported by the same companies for the preceding month, and by linking these percentages to. i±e indexes for the preceding month. 1946 - January •••••••• February ••••••• 23 25 26 29 18 19 20 22 28 36 36 35 Table 2.--Relative Importance of Loans Made by Sales Finance Companies During Kay 1946 and Outstanding Balances at End c£ llonth Paper acquired during month Clau of paper Outstanding balances, end oi' month Percentage of total Amount Percentage of total Total, all classes of paper !/•••••••• $199,517,654 100 '' .469,920,565 100 Total loans ••.• •·•••••• .••.•••••••.•• Small (personal) loans •••••••••••• Buaineea loans •••.•••••••••••.•••• 381672.269 107~5'73.345 27 ,484~492 19 5 14 54,832,960 62,740,385 23 12 ll 160,845,385 81 362,347,220 77 11,187~777 \ Total sa lee tinan oing !:J'•••••••••••• I . Amount Included ·in this clasdfication. are only those firma which, in addltion to their aalee financing. . . operations, reported loan acti v1 Ue.i • ' · Pap I SALES FIMANCB COIIPAliiBS Table 3,--Autamoti~ and Diversified Financing by Salee Finance Companiee and Balancee Outstanding at End of Jlonth Paper Acquired During 11ay 1946 Volume of paper acquired during May 1946 Claea of paper By all companiee reporting By companies reporting outetandi~j Outstanding balances May 31, 1946 !I Ratio paper acquired to out standi,;, balanon b balances a Total retail aut~otive ••••••••••••••••••• Total wholesale automotive,, •••••••••••••• Total wholesale- other than automotive,,, Total retail- other consumers' goods ••••• Industrial, commercial, and fare equipment 149,906,242 93,405,650 2,270,268 19,051,121 931,044 149,182,988 93,248,282 2,244,058 18,000,820 907,313 $199,836,818 59,106,075 5,309,031 106,244,929 6,204,277 25 158 42 17 15 Total sales financing.,,,,,,,,,, U65,564,316 $163,583,461 1375,701,130 44 !f ~ Data are baaed on figures from sales finance companies able to report both their paper ao~uired and their outstanding balances. Ratio& obtained by dividing paper acquired (column 2) by outstanding balances (column 3), Table 4,--:tlumber of can Financed and Volume of Paper Acquired by Sales Finance Companies During May 1946 Number of oar a Clau of paper Number Paper acquired Peroentap of total Dollar volume Total retail automotive •••••••••••••••• 100 5ww paaaen~r oars ••••••••••••.•••••• New commercial oars •••••••••••••••••• Uaed paaae~r cara •••••••••••••••••• Used commercial oars ••••••••••••••••• ll,759 6,040 44,230 2,838 18 9 68 6 8,309,965 7,008,830 25,ll7,441 2,225,732 Total wholesale automotive,,,,,,,,,,,,, 91,891 100 $8416391466 Eew oars (passenger and commercial),, , 641867 78,642 13,249 86 14 73,679,660 ll,069,806 Percentage of total Used oars (paaaen~r and commercial), 142,661,958 a/ - 100 20 16 59 6 a( 100 87 13 !/ Data are baaed on reports from sales finance compRniea providing a breakdown of their retail and wholesale automotive financing, These amounts are leas than those reported in table 4 due to the exclusion of some data for which breakdowns were not available, Table 6,~-Volume of Diversified Sales Financing During11ay 1946 Claea of paper Retail - other consumer•' goodlt Furniture, radioa, pianoa, and .other JIIUSioal inatrumenta .. Refrigerators and other houaehold.applianoee,,,,,,,,,,,,,, Reeidential building repairs and modernisation,,,,,,,,,,,, Miaoellaneoua ret-.tl •. , .••••••••• .-.......................... . Total retail ... , ,o;tb•r o~a.umersi of Dollar volume paper acquired $1,072,069 1,528,307 ll,448,893 4,894,995 goode ••••••••••••.•.•••••••••••• U8,944,~64 Total wholeee,le - :Other. than automoti w •• , , •••••• • •·• • •• , • , •••• Industrial, ooillleroial,. and farm equipaent ... , •••:.. ,. ...... , •• 2,270,258 931,044 Total divareified finanoing ••••••••••••••••••• $22,146,666 !f Percentage of total 6 7 62 22 86 10 4 100 Data are baaed on reportl frOID sales finance companiea providing a breakd01111 o~ their retail finllnoing bf other oolisumera• goods. Thia amount ::h .le.. than that reported in tab.le 4 due .to th• ezolulion of 1011111 data for which breakdown• ware not availabl!'o , ,, ,,, ,.
