Evening star., 1926-02-07
REPORT ON LOANS
. GREAT SURPRISE
Figures Are S1,O0O,0OO, 900
Above Standardization
on Markets Awaited.
BY the Associated Press.

VII Widi kClS AWdltCu.
by the Associated Press.
NEW YORK, February 6.-Chief
financial interest this week centered
IN the announcement by the New
York Stock Exchange. after the close
or business today, that stock and bond
collateral loans of members totaled
S3,5l3,114, ,194, or about 81 900 600, 900
above conservative estimates. It's eff
1ect on securities prices will be
awaited with widespread interest at
the opening of Mondays markets.
Loans to the extent of 50 ,043 044 .3O9
were obtained from New York banks
and trust companies. while the re
mainder of $40, 129,S45 We're obtained
from private bankers, brokers, for
eign bank agencies and other lenders
In New York City.
Outside Loans Unknown.
How far the rest of the country con
trlbuted TO the huge reservoir of funds
available for brokerage loans was not
tully revealed in the Stock Exchange
hSures, since the institution did not
require its members TO list loans car
rled outside New York. OF the total
however, approximately Sl,31O,729, ,O12
was borrowed through out -of-town
branch and correspondent offices. but
iheSe fEureS do not include Il large
aggregate of loans contracted for out
of-toWn customers who dealt through
New York offices directly.
Figures on brokerage loans assem-
hled by the Federal Reserve Bank of
New ork FOR the four weekly pc
RODS last month beginning January
will not be made public until next
week.
Simmons Explains Data
In making public the loan figures,
r.. IL. Ii. Simmons, president of the
New York Stock Exchange. issued
the following statement: Since the
war there has been a marked tend
ency for partnership enterprises to
convert into corporate form and to
list their securities on the exchange.
Many of the local authorities have
likewise called attention TO still an
other interesting and recent tendency
IN the security loan markets which
the present figures perhaps reflect,
namely, the increasing corporate prac-
tice since 1921 of obtaining working
capital by the sale of securities
rather than through recourse to
banking loans and advances
THE loans contracted upon stock
exchange collateral have thus come
10 possess both a more completely
national usefulness to business and
wider variety of important economic
and financial functions The collat-
eral of loans by exchange members
IS above reported includes securities
not listed on the New York Stock
Exchange. but in what proportion it
is impossible exactly to determine.
Since the war. however, the securi-
ties listed on the New York Stock
Exchange have experienced a notable
increase. Listed stock issues on
January /, 1919, numbered only 612
as against 1915 on January /, 1926,
an increase of 433 issues, or 20 per
cent.
Bonds Also Increase.
Similarly, listed bond issues have
increased between these same two
dates from 1131 to 1868 'issues-an
increase of 90 per cent. At the be-
ginning of this year the market value
Of issues listed on the New York
Stock Exchange totaled approximately
so 600, 900 900, exclusive of United
Sta a-es Government bonds twhoSe out
standing amounts on January |, 1926,
have not yet been reported by the
United States Treasury. The mar
ket value ofslisted issues amounted
TO S52.11S,S77, 1899. consisting of S34.-
$50 0.257.125 stocks and S17,63s, ,874
bonds.
Per Cent of Market Value.
In consequence. Stock Exchange
member loans in New York, as cur
rently reported, constitute less than
. per cent of the total market value
"f securities listed on the exchange,
about : per cent of the market value
Of listing exclusive of United States
Government bonds and about 10 per
cent of listed stock issues alone-a
significant indication of the efficiency
and economy with which credit is en-
ployed TO facilitate the ordinary
merchandising of securities through
the New York Stock Exchange mar
ket. If American business continues
TO prosper as 1t has in the past few
years, not only the market value of
exchange istings, but also the loans
extended on their collateral must in
evitably continue to show a proper
fiOr3te pYnancinTl