Delaware gazette and state journal. (Wilmington, Del.) 1883-1902, 1901-07-04
GUARANTEE LOANS STATEMENT.

Claim that Association is Able 70 Meet
Every Obligation Detnandabie.
The Guarantee Building and Loan
Association gave out the following
statement Friday afternoon concerning
Insurance Commissioner Marshall's
report OF Thursday: n
1.-The insurance commissioner q report
shows that the Guarantee Building and
Loan Association has received from all
sources Of whatever character the sum
of $4,000 which we shall not attempt
to deny. But no sane man will presume
that the association stands liable to the
stockholders for this amount, as many
thousands q dollars therein represents
earnings and 50 expenses. The bylaws
OF the association provide that all
moneys Of the association snail consti
tute general fund which shall be
divided into reserve fund and loan
fund. The reserve fund is for the
purpose of defraying the expenses of
the association, and an cunts to the
present time IN S26, coo, which the
auditors refused TO allow on the ground
that these funds had not been deposited
separately in bank, The counsels of
the association believed aud still believe
that the amalgamation of these two
funds in bank makes no material differ
encf so long Us their proper separation
was made in the office books, How the
auditors could ignore the expense ao-
count we are at loss to explain. They,
as well MS every other man believe
that the association could not do bust
ness without mourning expenses and
that these expenses must be met from
the receipts 10 the reserve fund. The
association has been doing business
Just about three years, and no man of
common intelligence will olsuy the fact
that the expenses for the first two years
were necessarily large, decreasing very
materially as the ASSOCIATION grew in
months. To subatantiate this fact we
ask that the expense account OF last
year be compared with the five months
of the present year. However, the
80, OC0 item in the expense account for
last year is not quite correct as at least
one amount Is included that should
not have been placed there. But, not
withstanding this amount, it will be
seen that the expenses for the present
year nave been decreased more than
four-foid over the corresponding months
OF last year, clearly demonstrating the
diminution of the expenses OF the
association as it grows 10 years.
Hence it will be clearly seen that
should the S26, 0T0, which belongs to
the reserve or expense fund be allowed,
which no doubt should be-, the assets
OF the ASSOCIATION would be s., o70 over
the liabilities.
The report is also misleading.
While it arranges certain matters in
the column under liabilities, it does
not state the fact that not scarcely one
of these liabilities are due &C the
present time, and from so to 90 per cent
of them will not be due under two or
three years from the present time. This
being the fact, the report should state
the earning rate of the association
during the time these liabilities are in
force and to the date when they become
due. This amount il properly calculated
would amount up into the thousands of
dollars, as the auditors themselves well
know, and we are sure will readily CON
oeiye. However, We are not surprised
at the inaccuracies Of the report and
the way and manner in which it IS cal
oulated to mislead the reader. as every
one of the auditors, including the IN
surance commissioner, acknowledged
the day they entered the home office 10
audit the books and examine the affairs
Of the association, that they did not
know anything about the plan OF busi-
ness of the Guarantee Building and
Loan Association.
The association has always been
ablo and IL today, to meet every fnan
cial obligation demandable, and We can
not SEQ the slightest reason for allowing
report to be issued which would carry
with it insolvency.