The Indianapolis journal. [volume] (Indianapolis [Ind.]) 1867-1904, 1897-07-03
WORLDS BIGGEST BANK
CREDIT FoNCIER OF FRANCE HAS
LOANS OF 1920, 100000 Francs.
Great Paris Institution for AccommO-
Duplicated i'm New York.

Buffalo Times
| The proposition recently made by New
York capitalists TO organize a financial in
stitution for the ultimate control of the
farm mortgages of the Nation. at about half
| the rate of interest now charged TO the
| agriculturists of the West and South, at
tracts attention anew to the famous Credit
Foncier of France. which the New York
men have taken as their model. Judged
by the record of the Credit Foncier, if
smaller bank could be successfully organ
lied and operated in this country. it would
be a tremendous boon to both the small
investor and the small borrower. The aver
age bank depends on the operations of
large capitalists for success. but the Credit
Foncier depends on the multitude and as a
| result it's resources are more significant
than those of any other bank in the world.
1t has outstanding loans aggregating about
5000, 100000 francs. or $4,000 900. Its re-
serve fund is close to 150000.000 francs and
its capital of more than 100000 900 francs is
intact It's great strength rests in the fact
that its loans of 1920. 100000 francs are all
fixed al long terms some of them for sew
enty-tYe' years, thus assuring an ever
growing yearly profit. No scandal of i'm
portance has ever besmirched the fame OF
the bank, a fact due in part to the strict
governmental supervision exercised over its
affairs
The system followed by the Credit Fon-
cier makes it actually nothing more than
a financial agent of the people. 1t has two
classes of clients-the borrower and the
lender On the property of the former it
advances loans and then it issues bonds,
which it offers for sale to the other. The
loans are made for periods varying from
tan five nd
terest to be paid up IN regular INSTALL
ments. The bonds representing the loans
are eagerly sought by the thrifty French
people, and by the wealthiest classes too,
but the small investor holds the bulk of
| them. 1t is said that there are few families
of the humber class in France which do
! not possess one or more of the bonds. They
| are regarded as absolutely safe. and the
| fact that the stability of the Credit Fon-
cier was not in the least staggered by the
! two or three revolutions 1t has passed
| through is one of the best evidences of it's
financial strength.
The system of loaning sums on realty for
! long term of years is not original with
France. Back in the time of Frederick II
it flourished in Germany, and the financial
genius of the great Wolowsk the first
to appreciate its immense power. He it
was who introduced it in France, and. like
| other radical innovations, it took con-
| siderable time to prepare the people and
| the government for its reception.
In a series of publications, in. 1893, he
| first began to exploit the theory of a Credit
Foncier, but it was not until 1845 that he
obtained from the government call for
| congress of juriStS, investors and agrfcul-
turists to study the proposition. The first
| deliberations of the congress were on the
| questions Of assuring the credit of the loan
| er and giving to this credit such a mObil
| ity that it could easily be subdivded and
| transmitted without risk or expense. These
| being found thoroughly feasible. the inter-
| est of the public was slowly aroused in the
project, and the new bank was about to
become a reality when the revolution of
| 184S upset. everything for the time being.
This revolution was peculiar from all
| others because of the numerous sham
| financial schemes advanced by visionary re-
| formers, who promised TO make the whole
nation revel in wealth at one sweep. For
tunateIy, at the head of French finances
was M. GoudchauX, man of exceptional
| intelligence and clear medicines. He OPP
posed all of the silly projects with rare
| wisdom and saved the nation from financial
Meanwhile NJ. Woowsk never allowed
his project to drop out of the public sight,
and when governmental affairs had again
settled he secured the appointment OF
commission for the collection of fnforma-
ton on the administration of the credit
banks of Germany. The result was emf
nently satisfactory and on Feb. IS, 1852, the
minister OF agriculture, NJ. j. B. Dumas,
passed decree. authorizing the reation
| of societies of the Credit Foncier. Imme-
| dately the Bank Fonciere de Paris was
founded, with a capital of 25'0OO,0OO francs.
1t was the original intention to establish
branch societies in different cities, and two
of these were found&l at NeVers ana Mar
settles.
d
cred that a plural system of credit banks
would be a disadvantage. and by decree
of Dec. 10, 1852 the Paris INSTITUTION an
sorbed those at Nevers and Marseilles, thus
becoming a truly national bank. AT this
time the Credit Foncier was under the
supervision of two ministers, the n mister
of agriculture and the minister q finance,
but it was deemed advisable 10 un!te IT
more directly with the stat. and in July o.
1854 it was recognized on the m"u". OF the
Bank of France thus beng p.1ced under
the supreme authority OF the minister or
finance
The Credit Foncier is housed in trinity
Of historical buildings, the public entrance
being near the angle formed by the boule-
wards of the Rue de Luxembourg ana the
the magnificent gardens OF the sp!enuld
mansion of the Marechal de Luxembourg
occupied the site, and when he died his es
tate was so badly involved that his widow
forced to sell the ground. the buyer
being a director of the Company of the In
dies. In 1926 he erected fine mansion.
which, with its stately court, to-day forms
the entrance to the greatest banking insti-
In 1858 the business of the Credit Foncier
had expanded to such degree that it was
necessary to secure additional room, the
Hotel Septueil built in 1922 by NJ. DesvieuX,
advocate to the Kings Council: was pur-
chased. 1t adjoins the first building, and
to-day is occupied almost entirely by the
bookkeeping department.
A third building became necessary in
May of 1862 and the great mansion of the
Crozat family, facing on the Place Ven
dome, was purchased for 2600,O00 francs
This structure was built in 1907, but it
passed out of the hands of the Crozats in
1877. It now contains the offices of the
council of administration. the library and
the apartments of the governor and the
two under governors.
1t is such a bank this that the New
York capitalists hope to establish, and
where farmers now pay 10 and u per cent.
interest on mortgage loans it is the inten-
ton to offer money for not more than per
cent and by judicious management, open
up a market for the millions of idle dollars
living in the vaults of the New York banks