St. Paul daily globe. [volume] (Saint Paul, Minn.) 1884-1896, 1889-12-25
IN TEN BRIEF MONTHS.
Not Yet a Yearly, and Paying Five PEI
Cent Dividends.
BRAINS MONEY! ENERGY.
These Made the Railway Building 8
Loan Association of Minneapolis
What II Is.

Building and loan affairs have held
peculiar interest Of late for the average
citizen of progressive ideas. And while
there have been no very startling facts
unearthed, more than ordinary interest
has been awakened, with result that
Is highly gratifying TO the officers Of at
least one c0ncern-the Railway Build
ing 81 Loan Association, of Minneap-
oils. This young and prosperous insti-
tuition seems to have enjoyed the nm
limited confidence of its stockholders,
almost from the very start, in February
last.
The plan of operation differs with
that of any building and loan company
in the United States. Strictly speak
ing, it is a cooperative bank. which
loans its money on the instalIment plan
to the stockholders. I'm this the
borrowers share in the profits, as
do the investors, in proportion to the
size of their deposits. The distribution
is made twice q year, or every six
months, when the gross profits are fig
ured up. From this amount is deducted
the total expense for the half year, and
the balance goes to the stockholders,
pro rata. TO illustrate, suppose the
gross profit for period of six months
TO be $4,000; the expenses are 5000 and
the total profit after paying expenses
for the six months, $1,000. Surprising
that the deposits are 100000, the rate OF
profit on each S1.00 would oe cents.
or per cent. Total deposit 100000. at
per cent equals 5000, the net profit.
Seven per cent being the rate OF profit,
we can readily ascertain what each
stakeholder is Untitled TO. Suppose A
has $1,000 on deposit for period of six
months at Z per cent; it would equal
$40. AS profit. B has 500 same time
as A; $500 at per cent would equal
s35. BIS profit. G has $50. on de-
pOsit same as A and b; his profit would
he $3.50. and so on. Each mans Sl.00
earns the same profit. DO difference
whether he is poor or rich; the profits
are the same on each dollar.
The dividends due the stakeholder
are entered in his individual pass-book
at the end OF each six months, and may
be withdrawn just the same as cash
deposit in savings bank.
Another. new and very important
feature OF their plan. which is to tie in
trDduced at once. is intended for persons
OF moderate income, who wish to make
deposits of irregular amounts. These
will be received, the depOSitOrS will get
the full benefit of their investment, aid
yet there will not be cent TO pay as
admission, or membership fees. CIhe
Railway" hOwev"r. has never charged
membership fees IN paid-up stock)
Moreover. all or any part of these de-
posts NAV at any time be withdrawn
upon presentation of paSs-bOOk and
certificate. This Is certainly most APP
probable feature. and one that cannot
fail to largely increase the Railways"
general business.
The assets of the association belong
to the stockholders. and are pledged in
payment of all deposits by being placed
with the Minnesota Loan and Trust
company as trustee. In accordance with
special contract made with that suit
slantial concern. All possible safe
guards We're placed around the FUNDS
of the association at the very Outset.and
the law which went into effect this year
found it amply practlced. One of the
several important resolutions provides
that the accumulated funds shall be de-
posted with the trustee as often as
they shall reach the sum OF Sl.OOa.
The general plan is not experimental
by any means. The famous "Birkbeck'
company, of England, the largest in the
world. and in operation for nearly forty
wears. is practically the same III prlll-
ciple. This concern laid the foundation
of its greatness by its ability and cheer
fulneSs and promptneSs IN meeting
Withdrawals of deposits at all times.
The Railway" proposes tOdo precisely
the same. j his years business, the
first in its history. has proved concIu-
sively that they can and will do it. And
this important fact will not be lost sight
Of
On the lst day of January the Asso-
citation will declare semi-annuai divi-
dend of per cent. The assets
amount now to about SIS, 000-ten
months work. This is a remarkably
good showing, and highly creditable to
the management. The officers, whose
salaries are paid directly from the earn
ings. are all welI-known business men
of Minneapolis. They are, respectively:
President, John 6. Taylor, general PAS
senger agent of the 500" railroad; vice
president, F. Fremont Reed; j. Il. Butin,
secretary, and Charles E. Cotton, treas
urer. The other offices are filed by
competent. energetic men. and the di-
rectory is an exceptionally good one in
many respects. ALTOGETHER, the Rail-
way Building and Loan Association may
be considered as one of the most pros
porous, ably managed and promising
financial concerns in the Northwest.