New-York tribune., 1918-04-30
Wilson Appoints
War Finance Board
And Committee on
Capital Issues
Will Provide for Credit
Needs of War Businesses
and Check Loans to
Non-Essentials

WASHINGTON, April 29.--President
Wilson to-day appointed four directors
of the new $5O0,OOO,OOO War Finance
Corporation, and the new Capital Issues
committee provided for in the war
finance corporation act.
Directors of the Finance Corporation
are William P. G. Harding, of Al-
both appointed to serve two years; Eu
gene Meyer, jr., Of New York, ana
Angus w. Mclean, Of North Carolina,
each to serve four years.
Members of the Capital Issues Com
mittee are Charles S. Hamlin, of Mas
sachusetts; John Skclton Williams, of
Virginia; Frederic A.. Delano, of Illi-
nois; James B. Brown, of Kentucky;
John S. Drum, of California; Henry C.
Flower, of Missouri, and Frederick H.
Golf, of Ohio.
System Already Perfected
The new capital issues committee
will use the machinery already created
by the Federal Reserve Boards capital
issues committee. For many weeks the
reserve boards committee has been
perfecting a nationwide system for
examining the merit of proposed Sc
curities issues and recently has re-
vised it's rules to conform with the
war finance corporation act.
The four directors of the finance
oorroro+;op +oro4oor with Socratarv
McAdoo as chairman cx-officio. are eX-
pected to organize and prepare to make
loans to banks and necessary war bus
inesses at once.
Paul M. Warburg, member of the
Federal Reserve Board and chairman
of the existing capital issues commit
tee of the board, was not nominated
on the new committee because Cover
nor Harding's nomination as director
of the war finance corporation will
throw heavy duties on Mr.. Warburg,
who is vice-governor of the board.
The corporation will start business
with capital stock of $500000,0O0 sub
scrbed entirely by the government,
and with authority to issue up to $3,-
000,000,000 bonds with which to finance
its operations. Loans may be made
to banks or trust companies for not
ing to rs per cent of the face value
of loans made by the banks to any
business "whose operations shall be
necessary or contributory to the prose-
cution of the war;" taking the banks
notes secured by adequate collateral.
This applies also to banks purchases
of bonds of essential war businesses.
One hundred per cent of the face value
of banks loan may be made if the
l. n,,1, t.I no}
collateral.
Savings banks and building and loan
associations may borrow from the cor
poration for not more than one year
| under certain circumstances.
Direct Loans Permitted
Direct loans to essential industries
or businesses may be made by the COR
poration if the directors find that the
advance is necessary to maintain the
business and if it has been unable to
obtain q loan from banks. In these
cases 125 per cent collateral is re-
CURED
The total amount loaned by the cor
poration direct to business is limited
to 1914 per cent of the corporation s
total capital stock and outstanding
bonds.
The new capital issues committee
will not have power to forbid issuance
of securities not approved by it, but
under the system built up by the Fed.
eral Reserve Board it is virtually i'm
possible for corporations or states and
local sub divisions to float issues with
out first obtaining the committees
consent. It's authority is limited tc
passing on issues of 100000 or more.
The present capital issues commit
tee consists of Paul M. Warburg, Fred
eric A. Delano and Charles S. Hamlin
member of the Federal Reserve Board
The advisory commi ttee, which proba-
bly, will be retained, consists of Allen
3. Forbes, Of New York, chairman, and
F. II. Golf, of Cleveland, and Henry c.
Flower, of Kansas City.
The salary of war finance corpora
tion directors will he $4,000 and of
the capital issues committee members