Full text of G.20 Sales Finance Companies : November 15, 1950

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'~I
BOARD OF GOVERNORS
OF THE
FEDERAL RESERVE SYSTEM
November 15, 1950
SALES FINANCE COJIPANIES

SEPTEMBER 1950
Retail financing.--The volume of retail automotive paper acquired during September by
reporting sales finance companies was 6 per cent leas than the August volume. This marks the
second successive monthly decrease. However, September's month-to-month decline was less than
the 9 per cent reported for August. All components of the automotive segment showeddecreases in
the volume of paper purchased.
Despite the smaller September volume, outstanding balances of retail automotive paper
increased 2 per cent during the month.
Compared with the August volume of other consumer goods paper acquired, September volume was lower by 12 per cent. The only category within this segment which reflected increased
purchases by sales finance companies was that of furniture, radios, and musical instruments.
Outstanding bal~ces of other consumer goods paper were slightly higher at the end of
September than at the end of August.
Retail Financing by Sales Finance Companies
change, August 1950 to September 1950
Volume of paper
Outstanding balances,
acguired during month
end of month

Perce~tage

Class of retail paper

Number
of carlj

-11

-+ 2
...
...
...
...

Total

-12
--

-+ 2

Furniture, radios, musical instruments
Refrigerators and other household appliances
Residential building repair and modernization
Miscellaneous retail

+27
-23

Automotive:

Total retail

Passenger cars:
Commercial cars:

Other conswner goods:

New
Used
New
Used

:...l
-5
- 9

-15
- 8

--

6

- 4
- 6
-16

-14
- 7

....
...
...
...

Wholesale financing. --..<;eptember purchases of wholesale automotive paper were substantially
less than those of August, according to reports from the sample of sales finance companies, However,
outstanding balances again showed a moderate increase.
The amount of other wholesale paper acquired during September were much less than the
August volume. Outstanding balances remained about the same,
Ratio of paper acquired to balances outstanding.--The turnover rate of receivables as
measured by the ratio of paper acquired during the month to outstanding balances at the end of the
month fell by 4 points to 26 per cent.
NOTE.-September data, based on returns from 124 sales finance companies, are compiled
in the same rna: mer as those shown in earlier reports. Aggregates represent only the totals for
the reporting companies and, since the reporting sample is not identical from month to month, they
are not comparable with totals of preceding months.

Page 2

SALEs· FINANCE COUPANIES

Table 1.--Automoti.ve and Diversified Financing by Sales Finance Companies
Indexes of Outstanding Balances: December 31, 1939 • 100 !/

End of' month
and year

Total
all
sales
f'inancing

Retail
automotive

Wholesale
autanotive

Wholesale
other
than
automotive

Retail
other
consumers'
goods

Industrial,
commercial,
and f'arm
equipment

100
140
250
40
8
11
38
224
394
454
332

100
129
148
76
30
26

100
131
147
61
27
26
23

105
226
232
187

89
116
107

1939··················
1940••••••••••••••••••
1941 ••••••••••••••••••
1942 ..................
1943 ..................
1944 ••••••••••••••••••
1945 ••••••••••••••••••
1946 ••••••••••••••••••

100
136
152

1947 ••.•.••.•••••...•.
1948 ..................
1949 ••••••••••••••••••

119
174
228

88
151
249

100
169
175
112
40
24
27
90
163
252
216

1949- September ••••••
October ........
November •••••••
December •••••••

22$
232
233
228

228
237
245
249

279
294
267
216

400
371
361
332

199
195
190
187

111
110
107

1950- January ••••••••

234
234
237
240
250
263
266
274
282

252
258
265
274
284
298
314
322

250
223
204
186
202
228
163
179
192

329

180
176
172
172
174
179
185
189
192

110
109
111
112
117
120
123
124
127

53

20
18
22

59

February •••••••
Jlarch ••••••••••
April ...........

May •••••• ,'~· ••••

June ...........
Jlicy" ...........
August •••••••••
September ••••••

100
132
149
37
13

15

18

42

330

398
485

531
531
499

436
424
422

39

59

110

Indexes as of' December 31 f'or the years of' 1939, 1940, and 1941 are based on f'igures reported by
sales f'inance companies on a supplementary report f'orm which accompanied the regular monthly report form f'or January 1942. Succeeding indexes are derived by calculating the percentage
changes of the outstanding balances reported by sales f'inance companies f'or each month f'rom.
those reported by the same companies f'or the preceding month, and by linking these percentages
to the indexes f'or the preceding month,

Table 2.--Relative Importance of' Loaus Made by Sales Finance Companies
During September 1950 and Outstanding Balances at End of' Month
Paper acquired
during month
Class of' paper

Out&tanding balances,
end of' month

Amount

Percentage
of' total

Amount

Percentage
of total

!/••••••••

$909 033.664

100

$3,461,174.519

100

Total loans., ..... , •....... , .......•

2~~4112732

Small (personal) loans •••.••••••••
Business loans ••••••••••••••••••••

10,394.507
43,017,225

6
1

5

16323042663
70,387,255
92,917,408

2
3

!/•••••·····••

855,621,932

94

3,297,869,856

95

Total, all classes of paper

Total sales financing

c:

Included in this classification are only those firms which, in addition to their sales financing
operations, reported loan activities,

SALES FINANCE COIIPANIES

Table 3.--Automoti~ and Di~rs~fied Financing by Sales Finance Companiea
Paper Acquired During September 1950 and Balances OUtstanding at End of Month
Volume of paper acquired
during September 1950
Clau of pttper

Total retail automotive •••••••••••••••••••
Total wholesale automotive, ••.•••.••• , •• ,,
Total wholesale -other than automotive •••
Total retail- other consumers' goods •••••
Industrial, commercial, and fare equipment
Total
~

sa~es

financing •••••••••••

By all
companies
reporting

Ratio paper
acquired to
outstandi,;J
balances b

OUtstanding
balances
September 30,

By companies
reporting

195o !I

outstandi~J

balances a

$323,020,720
491,972,388
15,233,993
32,697,307
8,311,548

$320,652,749
489,878,263
15,132,599
32,338,627
8,303,723

$2,636,998,059
301,054,088
31,805,148
294,823,830
95,172,500

$811,235,956

$866,305,961

$3,359,853,625

12
163
48
ll

- - -9 - 26

Data are based on figures from sales finance companies able to report both their paper ao~uired and
their outstanding balances.
Ratios obtained by dividing paper acquired {column 2) by outstanding balances {column 3).

B(

Table 4,--:Number of -Cars Financed and Volume of Paper Acquired
by Sales Finance Companies During September 1950

Number of oars
Class of paper

Paper

acquired

Number

Percentage
of total

Total retail automotive ••••••••••••••••

276,815

100

$313l592l746!'

100

New passenger cara •••••••••••••••••••
tlew commercial oars ••••••••••••••••••
Used passenger cars ••••••••••••••••••
Used c~~roial cars •••••••••••••••••

107,081
13,459
144,427
11,848

39
5
52
4

164,986,062
18,290,672
122,600,202
7,715,810

53
6
39
2

Total wholesale automotive •••••••••••••

313,783

100

$484l9961882!!'

100

liew cars (passenger and cOilllllercial) ••
Used cars {passenger and commercial).

295,329
18,454

94
6

465,475,688
19,521,194

96
4

~

Dollar
volume

Percentage
of total

Data are based on reports from sales finance compNlies providing a breakdown of their retail and
wholesale automotive financing. These amounts are less than those reported in table 3 due to the
exclusion of some data for which breakdowns were not available.

Table 5.--Volume of Diversified Sales Financing During September 1950

Class of paper
Retail - other consumers' goods:
Furniture, radios, pianos, and other musical instruments ••
Refrigerators and other household appliances ••••••••••••••
Residential building repairs and moderni~ation ••••••••••••

of

Dollar volume
paper acquired

10
27

$ 5,855,867

Miscellaneous retail,,.,.,, ..... ,.,,,,,,, .. ,, •........... ,

14,821,855
3,314,821
7.574.474

Total retail- other consumers' goods •••••••••••••••••••••••••
Total wholesale- other than automotive •••••••••••••••••••••••
Industrial, commercial, and farm equipment ••••••••••••••••••••

$31,567,017
15,233,993
8,311,548

Total diversified financing •••••••••••••••••••

$55,112,558

Percentage
of total

6

14

y

57
28
15
100

Data are based on reports from sales finance companies providing a breakdown of their retail
financing of other consumers' goods. This amount is less than that reported in table 3 due to the
exclusion of same data for which breakdowns were not available.