The Glenwood post., 1917-03-31
National Bank Head EIucidates
New System Of Farm Loans
by Federal Government
OUR BANK AT WICHITA

Callahan, president of the Wichita Fed
eral Land bank, has returned from
Washington, where he attended con-
ference of the presidents of the twelve
federal land banks with Secretary Of
the Treasury McAdoo and the members
of the federal loan board.
He expressed qualification over the
fact that this conference had fixed 4
flat interest rate of per cent, apply
ing to all parts of the United States
He declared that this interest rate
would prove a great boon to the farm
ers Of the middle west and predicted
that within a year the Wichita Federal
Land bank will have made loans aggrc-
eating from 6 to 10 million dollars.
Mr.. Callahan also announced that the
conference of bank presidents passed a
resolution requesting congress. to ir-
crease the limit of the loans permitted
to an individual borrower from $4,000
to $4,000. He expressed the hope that
the special session of congress, soon to
convene, would make this change TO.
the special benefit of the Wichita bank
district, where the average size of farm
loans is larger than in any other sec
tion of the United States.
In order that more funds may be
available for investment in farm loan
bonds and in turn smade available to
lend to farmers of this district. Mr..
Callahan urged that the legislatures of
Kansas, Colorado, Oklahoma and New
Mexico Immediately pass laws making
farm loan bonds approved investments
for trust funds, insurance companies
and savings banks.
Mr. Callahan announced that the
bonds issued by the twelve federal land
at AZ per cent, but would probably bn
sold at a premium. He expressed graf
ification over the fact that the federal
farm loan board has anticipated that mt
least 100 million dollars of these bonds
will be issued during the coming year
and is making arrangements which will
assure a ready market for them. All
of this money will be made available
to the farmers of the United States at
per cent.
To borrow from these federal land
banks, farmers are required to organ
ize themselves into groups containing
at least ten farmer-borrowers and each
group asking for at least $4,000 of
loans. Tho Wichita Federal Land bank
is now prepared to furnish blank
form of articles of association to make
the organization of these groups simple
aod easy. Other necessary blanks will
also be furnished on application.
Farmers are permitted to borrowIlp
to so per cent of the appraised value #
the land, plus 90 per cent of the value
of the permanent insured improvements.
Loans are to be made at per cent and
must be retired on the amortization
plan, which means a repayment by
fixed annual payments throughout the
period of the loan. The loans may run
from five to forty years at the option
of the borrower. The object of these
longtime loans is to enable the farmer
to meet. these small annual payments
out of the increased earnings Of the
land, made possible by the Investment
of the borrowed money.
This new banking system is purely
cooperative. It is for the sole use Of
farmers and prospective farmers. Farm.
ers will eventually own all Of the stock
of the federal land banks and they
will elect the officers Of these banks.
There is no opportunity for individual
profit in the entire system.
The preliminary organization Of na-
tional farm loan ASSOCIATIONS has pro-
eressed to degree far beyond the ex-
pectations Of the federal farm loan
board at Washington, and everything
points To- the unqualified success Of this
new enterprise.
Ths Wichita bank was the first bank
organized under the new system and Is
making fine progress. The first appli-
cations are in, and abstracts are being
examined, and in few days actual
loans will be made. Mr.. Callahan