Evening star., 1932-02-28
NEW TRAIL BLAZED
BY CREDIT BOARD
Reconstruction Loans Near
30-MiIIion Mark in Less
Than Month.

Working day and night, the Recon-
struction Finance Corporation has en-
barked upon its program for bolstering
the economic structure of the United
States with speed that in all likelihood
is without parallel in Government
annals.
This agency, which is charged with
the administration of a fund OF two
billion dollars to be turned into COM
mercial, industrial and agricultural
channels, came into existence on jan
uary %. The board of seven members
which directs its operations was sworn
in on February 2. With less than
month behind it, the corporation has
an organization extending throughout
the country and has made loans reach
ing into the millions.
The corporation is authorized to
make loans to banks, savings banks,
trust companies, building and loan as
soclations, insurance companies, mort
gage loan companies, Federal land
banks, joint-stock land banks, Federal
intermediate credit banks, credit unions,
agricultural credit corporations. live
stock credit corporations and railroads.
Advances thus far, as shown by the
daily Treasury statement yesterday,
total $29,65O, ,862.54. The board does
not make public the Identity of those
financial concerns which have applied
for or have obtained loans. In the
case of railroads, whose fiscal affairs
are supervised by the Interstate Com
merce Commission. loan negotiations
are being made public by the COM
mission. To date advances have been
authorized to two carriers, the Wabash,
which in Tp0piVfrc hin
l72,800, and the Missouri Pacific, ST.
100000.
The Finance Corporation will make
quarterly reports to Congress which will
show the amount of loans by classes
and by States.
Applications for loans are being re-
ceived by the corporation through
agencies set up over the country.
These agencies, located in cities where
there are Federal Reserve banks or Re
serve bank branches, were created to
facilitate the work of the corporation.
At present there are 80 of these, which
virtually completes this phase of Or
ganization.
At each of these agencies there is a
manager and advisory committee,
named by the board, to pass on all ap-
plications for loans and decide as to
the acceptability of the collateral Of
fered for the advances sought. The
manager and committee then forward
recommendations on each case to the
board for action.
For all but the railroad loans. the
board acts as sole judge. For the car
riers, however, the approval of the In
terstate Commerce Commission is a pre-
requisite
In this field the Finance Corporation
supplements the efforts of the agency
created by the lines themselves-the
Railroad Credit Corporation-which is
distributing the freight rate pool es-
tablished to assist weak carriers in
meeting their fixed charges
The Credit Corporation cannot, how
ever, make loans to roads in receiver
ship, and this class is dependent upon
the Finance Corporation for support.
While the Finance Corporation is say
ing nothing for the present concerning
the extent Of its operations, an idea of
the burden which has been thrown upon
it by the organizations needing funds
to carry on is gained from the activity
at headquarters in the old Department
of Commerce Building.