Evening star., 1933-10-28
HOME LOAN BANKS
EFFECT REVIEWED
President of Building and
Loan League Cites Support
by Associations.

Reviewing the effect of the Federal
Home Loan Bank system upon the &C
tivities of the building and loan aSSo-
Citations in the country during the past
year, marking the completion of one
year since the official opening of the
II regional banks in the system was
rounded out on october IS, 1882, Phil
lip Lieber, president of the United
States Building and Loan League, an
nounced that l,700 associations have
invested more than S15,000,000 in part
nership with the Government to build
up the Home Loan Bank system.
This record during period OF finan-
cial STRESS" said Mr. Lieber, revealing
the ability and Willingness of so large a
number of loan associations to partlcl-
pate in the bank system. is a splendid
illustration of the stability and sound
ness of the individual organizations. 1t
is even more remarkable that 1,7O0
have already completed the necessary
stringent examinations for entrance
when it is realized that as late as last
May there were still States which had
not yet amended their statutes to per-
init associations to participate.
Cooperation Needed.
A year ago. when the Home Loan
was needed to start business activity
which is being asked for today namely,
the absolute cooperation of all private
business and finance with the Govern
mentS plan for reconstruction. Six or
seven months ago the building and loan
associations, by investing in the Fed
eral Home Loan Banks in order to eX-
pdnd their own credit facilities, were
out in the forefront of those who were
saying to the Federal Government. We
Do Our Part Their Blue Eagles should
be predated about Six months ahead OF
the others
The Hons ne Loan ss Bank rI..;;y: system has a.
the past year, giving the building and
loan bodies an opportunity to take care
OF thousands OF new loan applications,
for home modernization, taxes, pur-
chase and some construction, as well
as to refinance thousands of existing
loans
The - regional banks in the sys-
tenn are established on a basis of pay
ing not only all their expenses but also
the required return to the Government
for use of its funds.
Corrects Old Condition.
fCtSpOIlSIDIIlly lOI plONIUIIlS llUille-
owner credit for the country has been
definitely placed upon the building and
loan associations by their position as
participants in the bank system. This
definite ALLEGATION of responsibility to
one type of institution has fostered
public interest in correcting one of the
main defects of pre-depresSion days
that is, the highly miscellaneous ac-
tivitles of the average financial insti-
tuition"
Referring to foreclosure actions and
the responsibility of the various asso-
Citations to their members Mr.. Lieber
SAID that the great majority of fore
closures instituted By building and
loan associations have been against
spectators who borrowed not to live
in a home but to sell house for profit
against families who had already
abandoned their homes, and in cases
where domestic infelicity made it no
longer possible for the family to cling
together and keep title to their home.
There are always" he added. some
people who will not and do not wish to
pay their debts, and, of course, even
tually the mortgage institution must
protect its investors against such bor-
rowers.'