The Indianapolis journal. [volume] (Indianapolis [Ind.]) 1867-1904, 1897-06-21
THE NEW B. AND L. LAW
EFFECT 1T WILL HAVE ON THE AS.
sOCTATIONs IN THE STATE.
Will Stop GO-as-YOu-PIease Methods
Some Associations May Go Into
Voluntary Liquidation.

The new building and loan law will go
into effect July l. and such associations as
do not care to do business under it can
go into liquidation, being amenabe during
the period of liquidation only to the laws at
present in force.
The new law puts quietus upon the go
as-you-please method of conducting the
building and loan business, if, indeed it
had not been already ended by the pressure
of public opinion. Nobody has ever doubt
ed the value of the building and loan asso
citation as SUCH and such institutions have
been peculiarly popular in Indianapolis. The
great majority of them are carried on now
as they were at firstly officers receiving
no salaries and loaning the funds of the
ISOLATION to the members upon unquestion-
able security But many bright people saw
in the popularity of the building associa-
ton opportunities to separate people from
their money and opportunities to make
large legitimate profits by the lapses of
members where there was very large and
widely scattered membership, and thus the
associations of national scope were con-
ceived in the Northwest. The idea was
quickly taken up here, and numerous as
sociations operating all over the State
were organized. Most of these were con-
servatively managed and have done well,
while others, by means of the Expense
fund" the Withdrawal fee" and various
bylaws set forth in very fine print have
made a good thing for the officers and
caused the stakeholder to come out loser.
1t was to remedy these abuses and weed
cut the wildcat institutions that the new
law was passed. It's main features are the
abolition of the expense fund, combining the
membership fee to one-haH of per cent,
circular statements OF condition TO stock
holders taxation of paid-up and prepaid
stock, full protection for the Withdrawing
stakeholder. In fact, the new law seeks
TO confine the building and loan business
to it's original purpoSe-that of providing
may combine their savings for the purpose
of building homes.
The advent of the new law will not af-
feet the business of the vast majority of
Those doing a purely local business will
operate under the new law without any
change whatever in their methods, and out
side of this city there are only q very few
concerns-in Evansville, Terre Haute, Fit.
Wayne and some of the larger towns-that
seek to do other than purely local bust
ness. In this city there are 161 associa-
tions, of which considerably more than
half are state associations. Most of these,
however abolished the expense fund over
year ago, and comparatively few OF them
still charge a withdrawal fee. Without
these prerequisites some of them have
found little profit in the business, and
number will take advantage of the new law
to go into liquidation. The estimates of
building and loan men as to how many as
socations will retire from business vary
all the way from fourteen to forty.
At the close of the last fiscal year the
reports to the auditor of state showed the
following figures on the building and loan
business in this State