New-York tribune., 1918-06-12
War Finance Board
Confers Here With
Utility Interests
Decision on B. r. T. Matur.
ity Expected; Will Ask
for Change in Policy

EoidtloIlS IOT more vigorous -iudLtlai
aid will be explained this morning Mt
Il special conference at the Sub
Treasury between spokesmen for the
industry, bankers and members of the
War Finance Corporation. AS a result
CT the meeting public utility men hope
system will be devised for relieving
the corporations from the impoverish
mcnt which in many cases is threat
ened by war conditions.
Eugene Meyer, ir., Clifford NJ. Leon
ard and Angus w. Mclean, directors,
and w. P. G. Harding, managing di-
rector Of the War Finance Corpora
tion, who are expected to be present,
will listen to full presentation of the
case of the public utility corporations
They have agreed to do this. it is said,
because of the dissatisfaction of pub
lie utilities over the policy Of the new
government agency with regard to aid
ing them.
Solvency Threatened
Representatives of the utility cor
porations contend that under the con-
struction that has been placed on the
War Finance Corporation act they are
unable to get any better terms from
the War Finance Corporation than
from banks, and this condition. they
assert, makes the new credit instru-
mentality practically of no value to
them. Moreover, they will stress at
the meeting to-day the fact that they
constitute essential industries. and
ttat without q broader recognition of
their claims for assistance their eff
ficiency and their solvency will be
threatened. IT is believed that the
conference will have an important
bearing on the pending applications of
the brooklyn and Interborough Rapid
, Transit companies for loans through
the War Finance Corporation.
Besides such concerns as the Elec-
URIC Bond and Share Company. Henry
L. Doherty & &C. and the Federal Light
and Traction Company, which are fiscal
agents, tinanciers and engineers in the
public utility field. representatives of
the purely banking interests will par
t'clpate in the discussion. The bank
ers VIII cal special attention to the
wording of Section 7 of the War
Finance Corporation act and will Rec
omrend changes.
Loans may be made to banks or trust
companies by the War Finance Corpo-
'atlon, according to Section 7 of the
act, tor not more than five years, in
| sums amounting TO rs per cent of the
lace value of loans made by banks to
any business "whose operations shall
De necessary or contributory to the
rosecutlon of the war;" taking the
banks, notes, secured by adequate col
lateral. One hundred per cent of the
corporation if the bank deposits 33 per
cent additional collateral.
bankers Loath to Make Loans
From the point of view of the
bankers, according to opinions ex-
pressed yesterday, it would be bad
banking for them to make loans on
this basis. They feel that by their
Endorsement of the obligation of any
corporation seeking loan they might
some time be in position where
their deposits would be jeopardized
They look upon such notes outstand-
ing as IN the nature of contingent
liabilities.
One of the specific reasons for the
calling of this meeting was said to
be the failure of bankers and the War
flnance Corporation to agree on a
plan Tor taking up the S57,735,00O
Brooklyn Rapid Transit six-year pe1
cent notes maturing July 1. In view
of the proximity of this maturity
however, it is believed that a special
case will have to be made if govern.
ment aid is forthcoming. The sug-
gestlon has been made that the War
flnance Corporation may take up the
no1es with the proviso that they may
De extended for another year at i
out, would afford bankers. the com.
pany and the War Finance Corpora.
ton an opportunity to formulate p
permanent plan.
Inc main purpose of to-day's inter.
change of views is to express the at.
tltude land the requirements of the
public utilities corporation as a whole
rather than Of particular cases. The
suggestion will be made that the War
FINANCE Corporation modify it's policy
ana grant easier terms TO perhaps
Inree or Tour of the public utilities
corporations, which, though solvent be-
a4ie ne me 'ne war, are IN very great need
OF hnanclal rescuing at this time he.
cause OF the rise in prices and the
partial monopolization of the fioatine
asserted that such l,,11EI; polisv ,uou1d W Is
change the whole atmosphere that s,,..
rounds public utilities cornorat;one
and would make banks and the peneral
Insestlhg pubic more willing to place
money IN such corporations. The
mere announcement that the govern.
ment is behind the public utilities cor.
porations, it is declared, viii o;u. oE,
them new and necessary prestiee e's
The conference will start ot :,
O'Clock and will probably last =,
least until late in the afte Thl
fullest opportunity for an exnress;n, ~,
or the varied reactions toward IN.
financial distress of the public util;+;a,
corporations will be given. The dc
cussion Is expected to be almost who'll,
eA parte. 1t IS not expected that w.
members OF the War Finance Cornora wy
tlon viii announce any chanSe or poa ,,,aa a
lticatlon of its policy at the raat;oa NO
but the public utilities men bnno .iIi .i & 3
visions. "oioal re
Conferences Elsewhere
Less formal conferences have bee,
held neld from time to time in New YorL
,IhicaSo and Philadelphia durine IN,
iasc lew weeks as result of the nre
car!ous condition of public util;t;e,
finances. The Chicago Clearing Hons
has appointed committee Of thras
leadlng bankers to study the puhli,
utilities situation and be ready to con.
Ter with members of that industr,
with regard to possible steps toware
financial relief.
Establishing a FOre;on Rsrk