The Birmingham age-herald., 1921-07-20
RESERVE BANKS ID GIVE FURTHER AID ID COTTON GROWER
Governors of Southern Banks Decide to Grant Necessary Credit for Harvesting
 and Marketing Crop
By Associated Press

" "HH't x NVis July lJ.--t urtueF credit for harvesting and marketing the coming cotton crop will be ex- tended in whatever amount legiti- mately required, 1t was announced to- night by the federal reserve board and the governors of the reserve banks of Richmond, Atlanta, Kansas City and Dallas
 The announcement was made after a meeting of the governors of the reserve banks in the cotton growing sections to formulate uniform policy on cotton loans for the order ly marketing of the new crop. It was decided that credit would be ex- tended either directly to member banks by the reserve banks or in- directly to non-m member banks through the member banks
 Governor Strong of the New York reserve bank, and representatives of certain New York member banks attending the conference said 1t was their opinion the proposed establish ment of fund by various commer- cial banks for making loans on cot ton was neither necessary nor ad- visable' at this time
 The statement issued by the con ferees said:
 Statement Of Conferccs
 In view of the vital Importance of the problems incident to the har- vesting and marketing of the com ing cotton crop, the federal reserve board today held conferences with the governors of the federal reserve banks of Richmond, Atlanta. St. Louis, Kansas City and Dallas, the banks located in or brought in closest touch with the member banks tn the cotton states, for the purpose of re- viewing the credit situation in these states, and determining what further credit will be needed to facilitate the harvesting and orderly market ing of this crop.
 At the present time the five banks in question are leading to their members s457000,000, or more than 26 per cent of the loans of the en- tire system, the Richmond bank bor- rowing S16,000,000 for that purpose The total loans of tbese five reserve banks to their member banks exceed { their reserve deposiNs by sls2 .o00,- 900, whereas the tes2rve deposi1s or the other seven reserve banks ex- ceed their loans tc their members by st1S,000, 900.
 Greatest Loans In History
 The amount now loaned by these reserve banks to their members is Tour and e-half times the amount borrowed at any one time by all the national banks of the country prior to 1914, or before the establishment of the federal reserve system.
 The federal reserve board and the governors of federal reserve banks announce that the federal re- serve banks, In addition to credits already extended, are able to stand ready to extend further credit for the purpose of harvesting and mar keting the coming crop, in whatever amount may legitimately be re- quired either directly to their mem Der banks or, under q ruling now is- sued by the federal reserve board. Indirectly to nonmember banks act Ing through the agency and with the indorsement of a member bank These loans will be made by the federal re- serve banks upon notes. drafts and bills of exchange issued or drawn in accordance with the terms of the federal reserve act and the regula- tions of the federal reserve board for the harvesting or orderly marketing of the coming cotton crop.
 To Loan ErecIx
 "in order however. that these re- discounts facilities of the federal re- serve banks may be made fully ef- fective, it will be necessary that member banks in the cotton states place their loaning faciitles freely at the disposal of cotton producers and dealers in their respective lo- calities with the knowledge and as- , surance that the federal reserve board and the federal reserve banks recognize the urgency of rendering all proper assistance to these mpor- tant interests during such abnormal times.
 MT. Meyer, managing director CT the war finance corporation. who attended the conference. review ct the activities of the war finance cor poration in making loans for finance ing cotton for immediate and future export. tioNernOr strong or the teu- eral reserve bank of New York and representatives of certain New York member banks were also invited to the conference to discuss the neces- sity or advisablity of having various commercial banks throughout the country establish fund for the pur-s pose of making loans upon cotton. IE view of the conclusions reached by the conference as to the ability of the federal reserve banks effec- lively to take care of all of the legitimate requirements of the cotton interests. it was felt that the estab- lishment of such fund at this time is neither necessary nor available Governor Strong stated, however, that he had received assurances from a number of important banking insti- tutions in New York city that if the facilities now offered by the federal reserve banks and the war finance corporation should prove to be made, ouate, they will cooperate in the ea- tablishment of a cotton loan fund In whatever amount the situation might demand"
 RAIN SAVES MIL 1 IONS