The sun. [volume] (New York [N.Y.]) 1916-1920, 1919-06-18
OFFER $54,OOO,OOO
LAND BANK BONDS
Syndicate of Bankers With
Many Agencies. to Place
Issue on Sale.
CARRIES TAX EXEMPTION
Bear 4 1-2 Per Cent. and Are
to Be Only Farm Loan Offer
ing Before December.

A nationwide syndicate of bankers
with $50 to 400 distributing agencies in
conjunction with the twelve Federal
land banks will offer to-day $4,000, 900
Federal Land Bank u per cent. farm loan
tax exempt bonds. The same syndicate.
without the active work of the Federal
land banks, about a year ago offered and
sold within forty-eight hours $4,000. 900
per cent. farm loan bonds quick
sale of the present offering is antici-
pated, the price being 1001a and inter-
est less u to dealers, brokers and banks
with selling departments and the yield
about 4.3S per cent.
The syndicate is headed by the Ma
tional City CouNany. Brown Brothers &
Co.. Alexander Brown &c Sons of Baltl-
more, Harris, Forbes & Co.. and Lee,
Higginson & Co. Between the present
offering and December I there will be no
additional public Offering OF Federal farm
loan bonds. The present issue runs for
twenty years and 1t II authorized by
direction and control OF the Federal
Farm Loan Board. The bonds are ex-
empt from Federal. State municipal and
local taxation, having as complete ex-
emption as the first Liberty Loan Sh
per cent. bonds or the more recent is
sue of az per cent. Victory notes.
According to a circular issued yester-
day by the bankers. who say that at
1904 and interest the bonds net more
than 4.3S per cent TO the redeemable
date, 1924. and AZ per cent thereafter
up to redemption or maturity. the condi-
| tons surrounding the bonds were de-
scribed as follows:
THE twelve Federal land banks were
organized by the United States Govern
.
stock. which has since been increased
through operations OF the system to over
s1s.500.000 The Federal land banks
were created to meet the agricultural
needs OF the Cnited States as the Federal
| reserve banks were designed to meet the
mercantile and manufacturing needs.
TN order to avoid confusion 1t should
be noted that the bonds OF the Federal
land banks are issued by banks created
by the United States Government in
which banks the Government owns a
substantial amount of the stock. All
twelve Federal land banks are liable for
the ultimate payment of all bonds issued
! by each and every Federal land bank.
Joint stock land banks are organized
under the same act OF Congress-. but are
| owned by private interests, the United
States Government holding none of the
| stock and there is no liability on the part
cation Of the others.
Federal land bank bonds are secured
ty deposit OF an equal amount OF United
States Government bonds or first mort
ga ges on farm lands cultivated by the
| owner. which mortgages are appraised
and guaranteed by the local National
Farm Loan Association. of which the
borrower Is member and stakeholder
Each stakeholder is liable for twice the
I..2 Ill
Is made the property must be examined
end a separate appraisal and written rs-
| port made by an appraiser or appraisers
appointed by the Federal Farm Loan
Board. This appraisal must be finally
confirmed by the directors OF the fed
eral land bank of the district and
before a bond issue is allowed the
original application and appraisers
| report on which each loan is based
| mrst be examined and passed upon by
the Securities Department of the Fed
eral Farm Loan Board in Washington.
No mortgage loan may be made in ex-
cess OF $40 1000 nor may It exceed one
half the appraised value of the land
| mortgaged and 20 per cent OF the APP
pi aised value OF permanent insured i'm
provements thereon. The mortgagor con-
tracts to reduce tho amount of his loan
| by annual and semi-annual payments
OF principal with payments of interest,
| thereby constantly increasing the margin
Of security.
THE bonds are acceptable by the
United States Treasury at par as secur-
| lily for Government deposits. including
Postal Savings funds. They are lawful
investments for all fiduciary and trust
funds under the Jurisdiction and controi
OF the Federal Government. They are
eligible under the laws of many OF the
States for investment of all public and
private funds and are eligible for in
vestment by savings banks in the follow
ing States: Arkansas. California. Colo
| RADIO, Delaware, Florida, Georgia, Idaho,
Indiana, Kentucky. Louisiana, Maine,
Maryland. Minnesota, Massa chusetts,
Mississippi, Nebraska, New Hampshire.
New Jersey. North Carolina. Ohio, Okla
homa, Oregon, Pennsylvania, Rhode
Island. South Carolina. South Dakota.
+, Tennessee, Texas, Utah, Vermont, Vir-
ginia, Washington. West Virginia, Wis
consin, Wyoming.