Watauga Democrat. [volume] (Boone, Watauga County, N.C.) 1888-current, 1917-02-22
Opening Of the Farm Loan Banks.
Charlotte Observer,

Charlotte Observer.
A notable event this spring will
be the opening of the doors OF the
twelve Farm Loan Banks estab.
lished by the Government. The
books have been kept open. the
required thirty days for public
subscription to capital stock,
and the Government itself will
subscribe whatever amount may
be lacking. Shortly after the
banks have begun operations,
the mortgage bonds which the
act contemplates issuing will be
placed on the market. The
Washington correspondent Of
The New York Journal of Com
merce says ithas been prophesied
that these farm loan bonds will
be ready to market probably as
early as March. "Inasmuch,"
says the correspondent, "as the
administrators of the law look
upon these bond issues as afford
ing good Investments for the
public, it is expected that they
will be studied very carefully in
the bond market. As a matter
of fact, it is hoped and anticipa-
ted that the farm loan bonds will
be taken up largely by insurance
companies and other similar f.
nancial agencies which have am.
pie funds at their command to
make such Investments, although
it is maintained that the bonds
will afford an acceptable oppor-
tunity to individual investors"
The farm loan bonds will sell at
four per cent interest. The Farm
Loan Board says the bonds will
be issued in series ofnot less than
$4,000 each and probably not
more than $25O,OOO each, as and
when authorized and approved
by the Federal Farm Loan Board
after such investigation and ap-
praisement as it shall deem wise.
They will be tho obligations OF
the issuing bank. Under this ar
rangement it is entirely possible
to try out the marks cautiously
and to sell the bonds at the best
time and under the hest condi-
tions. An important feature is
that they will be exempt, both
as to principal and income, from
Federal, State, municipal and
local taxation. They will be is-
sued in denominations of $25,
$50, 500 and 81 900. They will
be in coupon form and may be
exchanged into registered. 1t
has been declared that they will
be issued for "a term of probably
thirty years, redeemable after
five years. The interest will be
payable semi-annually. The II
Federal land banks will be joint
ly liable for interestpaymentsu up
on the bonds issued by any one
OF their number, and for such
portion of the principal as shall
not be paid after the assets Of the
issuing bank have been liquida-
ted and distributed. The cores.
pondent quoted again points out
that each mortgage is to be
guaranteed by a Farm Loan
Association" OF which the bor-
rover is to be a member and a
On this stock will
be a double liability. Each as.
sociation will be required to pur-
chase stock in the farm land bank
to the amount OF five per cent OF
the loans to it's members, and this
stock is to be held by the bank
as security on the associations
guarantees. Each OF the twelve
land banks will start business
with assets OF $3.50, 900, derived
from the sale OF it's capital stock.
This stock will increase with each
loan made, to the amount OF five
per cent OF such loan, lit rea-
ches 81 500, 900, after which the
repayment OF the $750,0OO ori-
min llv cuhoor;ho1 will hoo,,