Full text of G.20 Sales Finance Companies : October 12, 1949

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BOARD OF GOVERNORS
OF THE
FEDERAL RESERVE SYSTEM
October 12, 1949
SALES FINANCE COioiPANI!2

AUGUST 1949
Retail financing.--In August the reporting sales finance companies purchased a larger
volume of retail instalment paper than in July. A sharp increase in automobile transactions
during the month was accompanied by a further expansion in outstanding balances. Financing of
commodities other than automobiles was also up from the July level but balances outstanding on
these goods showed a slight decline during the month.
The 17 per cent gain in automobile paper acquired reflected increased instalment sales
of all types of vehicles. The largest percentage rise was reported in the dollar volume of new
passenger car financing.
Paper arising from sales of other consumer goods rose .3 per cent above the July volume.
The only class of paper which failed to increase was that based on sales of refrigerators and
other household appliances.
Retail Financing by Sales Finance Companies
cha.rute_.._ July 19u~ to AlWlst 19lt9
Volume of paper
Outstanding balances,
acauired durJ.ilg- month
end of month

Percen~e

Class of retail instalment paper
Automotive a Total retail

Number
of cars

!!2

ill

!:...2

Passenger carsa

New
Used

+24
+9

+24
+8

...
...

Commercial cars:

New
Used

+20
+24

+21
+22

...
...

.!.....1

.=....!

+20
- 2
+18
+8

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

Other consumer goods:

Total

Furniture, radios, DDlsical instruments
Refrigerators and other household appliances
Residential building repair and modernization
J4iscellaneous retail

Wholesale financing.-New and used vehicles financed on a wholesale basis were in much
larger volume in August than during the preceding month; and the outstanding balances in this
category increased. The volume of wholesale paper for other goods was also above the July amount
but outstanding balances continued to decline.
Ratio of paper acquired to balances outstanding.-The turnover rate of receivables as
measured by the ratio of paper purchased during the month to outstanding balances at the end of
the month increased 4 percentage points to 34 for August.

NOTE.--August data, based on returns from 120 sales finance companies, are compiled in
the same manner 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 collilarable with totals of preceding months.




Page 2
SALES FiliANCE COJIPANIES

Table I.--Automotive and Diversified Financing by Sales Finance Companies
Indexes of Outstanding Balances; December 31, 1939 • 100 !/

End of month
and year

Total
all
sales
financing

1939··················
1940 ••••••••••••••••••
1941 ••••••••••••••••••

Retail
automotiw

l'iholesale
automotive

Wholesale
other
than
automotive

Retail
other
consumers•
goods

Industrial,
commercial,
and farm
equipment

100
169
175
112
40
24
27
90
163
252

100
140
250
40
8
11
38
224
394
454

100
129
148
76
30
26
39
105
226
232

100
131
147
61
27
26
23
59
89
116

1948 •...•••..•.•••••••

100
136
152
53
20
18
22
59
119
174

1948-August •••••••••••
September ••••••••
October ••••••••••
November •••••••••
December •••••••••

155
157
163
167
174

136

165
154
191
211
252

396
362
389
418
454

249
247
243
238
232

119
119
118
116
116

1949-January••••••••••
February•••••••••

177
180
184
188
191
198
203
214

152

273
289
281
260
219
225
227
242

484
561
571
551
515
479
430
417

221
214
207
203
202
203
203
202

118
117
111

1942 •.•..•...•.....•.•
1943 ••••••••••••••••••
1944 ••••••••••••••••••
1945••••••••••••••••••
1946 ••••••••••••••••••
1947 ••••••••••••••••••

March ••••••••••••

April ••••••••••••
)5q' ••••••••••••••

June .............
July .............
August •••••••••••

100
132

149
37
13

15

18

42

88
151

142
145
148
151

155

164
175
188
197
2o6
219

ll2

112
111
lll
lll

Indexes as of .December 31 for the years of 1939, 1940, and 1941 are based on figures reported by
salea finance companies on a supplementary report form which accompanied the regular monthly 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 the indexes for the preceding month.

Table 2 .--Relative Importance of Loans Made by Sales Finance Companies
During August 1949 and Outstanding Balances at End of Month
Paper acquired
during month

Class of paper

Outstanding balances,
end of month

Amount

Percentage
of total

Amount

Percentage
of total

!/••••••••

$884,950,460

100

$2,647,443,844

100

Total loans ••.•..••••••••.••••••••••

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

40,359,128
10,221,190
30,137,938

4
1
3

1501 565 1 164
71,854,601
78,710,563

6
3
3

!/• •........••

844,591,332

96

2,496,878,680

94

Total, all classes of paper

Total sales financing

!(

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




Page 3
SALES FINANCE COMPANIES

Table 3.-~utamotive and Diversified Financing by Sales Finance Companies
Paper Acquired During August 1949
and Balances Outstanding at End of Month
Volume of paper acquired
during August 1949
Class of paper

By cmo.panie s

By all
companies
reporting

reporting

Ratio paper
ecquired to
outstandi,;,
balances b

Outstanding
balances
August

Jl•

1949 .!!:

outstandi~J

balances a

Total retail automotive,,,,,,,,,,,,,,,,,,, $296,959,644
Total wholesale automotive,,,,,,,,,,,,,,,,
5C19 ,967,492
Total wholesale- other than automotive,,,
14,924,564
Total retail- other consumers' goods., •••
29,494,063
Industrial, commercial, and faro equipment
5,434,177

$295,438,949
508,373,420
14,918,599
29,124,458
5,402l488

$1,742,765,684
378,653,359
31,605,028
306,363,118
83l213l174

17
134
47
10
6

Total sales financing ••••••••••• $856' 779,940

$853,257,914

$2,542,600,363

34

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

Table

of ~ars Financed and Volume of Paper Acquired
by Sales Finance Companies During August 1949

4,--~umber

Nwnber of cars
Class of paper
Number

Percentage
of total

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

254,906

100

New passenger cars •••••••••••••••••••
New commercial cars ••••••••••••••••••
Used passenger cars ••••••••••••••••••
Used c~~rcial oars •••••••••••••••••

96,949
16,893
129,311
11,753

38

7
51
4

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

312,527

100

liew cars {passenger and commercial) ..
Used cars {passenger and commercial),

296,479
16,048

95
5

!(

Paper
Dollar
volume

$264,640,768 .!!;/
142,738,192
22,012,595
92,050,433
7,839,548
$480,904,561 .!!;/
466,191,802
14,712,759

acquired
Percentage
of tot&l

100
54
8

35

3

100
97
3

Data are based on reports from sales finance compNties 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 August 1949

Class of paper
Retail - other consumers' goods:
Furniture, radios, pianos, and other musical instruments,,
Refrigerators and other household appliances, •••••••••••• ,
Residential building repairs and modernization,, ••••••••• ,
Miscellaneous retail., •....••••..••• ,,, .•.. , .••.••.. , ..•• ,
Total retail- other consumers• goods •••••••••••••••••••••••••

Total wholesale- other than automotive,,,,,,,,,,,,,,,,,,,,,,,
Industrial, commercial, and farm equipment,,,,,,,,,,,,,,,,,,,,
Total diversified financing ••••••••• ,,,,,,,,,,

of

Dollar volmne
paper acquired

Percentage
of total

$ 1,495,834
16,443,833
2,976,700
7.953.599

16

$28,869,966 .!!:1
14,924,564
5.434,177

59
30
11

$49,228,707

3

34
6

100

Data are based on reports from Gales finanoe 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 some data for Yhich breakdowns were not available,