Evening star., 1926-10-31

Continued from First Page)
bankers. unfamiliar with the terms
of the soldiers bonus act. are up in
the air over the policy connected with
these loans. That most of them re-
gard them as unfavorable is generally
conceded.
Speaking for the District Bankers
Association. of which he is secretary,
Wilmer j. Waller. vice president of
the Federal National Bank.
said the question Of issuing loans to
veterans was hardly a matter on
which the association should take
formal action, but was one for m
divdual bankers to determine for
themselves.
"Veterans can hardly expect to
walk into any bank, put down a GER
tiflcate and walk out with a loan he
said Few banks lend to any bu1
regular customers, he said. and can
hardly he expected to lend at ran
dom to any veteran who apphes.
This was an opinion voiced also
hy Robert n. Harper. president of
the District National Bank. who Is
clearly sympathetic. however. with
the position In which many veterans
undoubtedly will ind themselves. His
bank. he said, stands ready 10 lend to
veterans who are it's customers. based
on the loan value Of the certificate.
Only in exceptional cases, he believed.
should the bank lend to others who
are not customers, as 4 matter OF
policy.
Veteran Must he identified.
Another side If the problem which
MIR. Waller emphasized is the tact
that the veteran may or may not be q
good risk and the banks may find
themselves with conSlderable
amount of "fruZen' funds on their
hands. The veteran who goes to Dor
row money on his cer;if1cate must
come prepared to offer bona t1de proof
that he Is It's lawful holder. Nor
have banks the means of distinguish
-. go, ,'.~ vo.ornr' "hD intC Ids
IN take un his loan after its expiration.
he explained, and the man who as
collect N time fruii IL ''Dt e"fim mt
and simply defaults.
Due to a widespread impression over
the country that THESE lo>,ii.' are oo"S
atory on the banks. ths veterans
Rureau has requested the Federal Re
serve Board TO issue instructions ana
regulations to all bankers so there
need be no misunderstanding IN inter
preting the law. These Instructions
It was said. may be forthcoming
some time in November, since the! are
scheduled to be taken up at the next
meeting of the board on November
:. and 9. Along with the inStruc-
lions. il has been suggested that the
Federal reserve system issue stand
ard form of note IN order to Slmpll1y
,,,otta,.s not .,rl.- 60" -" banks hut
also for the Veterans Bureau. when
called upon to make gnhd on IG''HS
that have been defaulted.
The average amount which the vet
a,.an may obtain as q loan during the
YEAR 1927 on the security OF certi1i-
Gates that have been In force TWO
years is approximately a12 cents Tor
each dollar of the face value or the
certificate No bank is authorized to
make a lean to a holder until two
years have elapsed after the eHectlVe
date of the certificate.
Maximum sum Available, -
The maximum amount of the loan
available on the anniversary date dur
Ing 1917 on the security of the GER
tificate issued in 1925 is determined
by multiplying the face value OF the
certificate by the first factor shown
In the table on the face of the GER
tiflcate. For example, certificate is
sued January l. 1925, age 30 years,
face value 81 900, multiplied by $.OS7S6
equals $S7. Sc, the amount that may be
loaned to the veteran upon the
security.
While the banks are hedged about
by protection, it seems to be the
general attitude that they are not
eager to tackle the red tape" which
one is likely to encounter in present
ing a certificate for collection. But
there Is apparently less cause for this
anxiety than Is Indicated.
In the event Of default, the bank
NAV present the certificate for collec-
ton not earlier than six months from
the date the loan was made. This, OF
course. means delay Of three months
in the case of the usual 90-day note.
This appears to be one OF the chief
objections from the viewpoint of. bank
ers. On the other hand, the banks
holding certificates as collateral secur.
ity may sell the note to or rediscount
1t with any bank authorized to make
a loan to a veteran under the act and
transfer the title to such bank. The
law says:
Eligible for Discount.
upon the Endorsement of any bank,
which shall be deemed a waiver of de-
mand, notice, and protest by such
bank as to its own Endorsement ex-
clusively, ana subject to regulations
to be prescribed bx tha EedaraI Re-