Evening star., 1934-01-20
BOSTON BANK JOINS.
HOME LOAN SYSTEM
Fahey Says Entrance OF
Provident Firm Is Sig.
nificant Step.

Entrance this week of the oldest and
One of the largest mutual savings banks
Home Loan Bank system was pointed
out by John H. Fahey, chairman of the
Federal Home Loan Bank Board, as a
significant step in the development Of
the system as a national reserve fDr
home loan finance.
In announcing that the Provident In
stitution for Savings of Boston has be-
come a member of the Federal Home
Loan Bank of Boston, Fahey stated:
The Provident Institution for Saw
ings, founded in 1916, has the Oldest
mutual savings bank charter in the
United States. and, with total resources
of S112,204772 on October 81. 1888, it
ranks among the Is largest mutual saw
ings banks in this country. 1t is the
second largest in Massachusetts, and
has more than 100000 depositors. 1t
has taken the leadership in MaSSachu-
setts in becoming member of the
Home Loan Bank system. This step is
directly in line with report recently
made by the Savings Banks Association
OF Massachusetts, which definitely ad-
vised the 1913 mutual savings banks of
that State to apply for membership in
the Federal Home Loan Bank system.
Splendid Cooperation.
THAT recommendation is a step to-
ward the development of even greater
public confidence in the safety of saw
lngS bank deposits and indicates the
splendid cooperation which the MaSsa
chuSetts mutual savings banks are Civ
ing to one of the most constructive
measures so far undertaken by the Fed
eral Government in behalf of privately
managed thrift institutions The report
likewise emphasizes that the procedure
III obtaining membership presents no
difficulties for savings banks in New
England or New York or New Jersey.
This forceful Endorsement of the
system by savings bank executives is
based on the fact that the Federal Home
Loan Bank system is the first Nation
wide effort to organize mortgage re-
serve system, involving over S20000,
100000 of funds. The system therefore
deserves careful study by executives and
depositors of all institutions holding a
substantial volume of home mortgages.
1t was created to give mutual savings
banks, building and loan associations
and insurance companies handling home
loans a service similar to the redis
count privileges supplied through the
Federal Reserve system in the field of
commercial credits.
Furtner Advantage.
"A further advantage of membership
In the Federal Home Loan Bank sys-
tenn is that it extends beyond local or
State boundaries, to embrace all sound
institutions in this country lending upon
home mortgages under approved, con-
seryative practices. Its resources should
therefore be sufficiently large and f1eX
ible, even in periods of acute credit
strain, to permit its member savings
banks and building and loan associa
tions to render uniform. dependable
service to the public without restricting
their normal deposit. investment and
home financing activities"
simultaneously with this announce
ment, the Federal Home Loan Bank
Board made public the fact that the
first member Of the Federal Home Loan
Bank system beyond the continental
boundaries of the United States has just
been added to the system in the men,
bershlp Of the Mutual Savings and Loan
Society of Hawaii. Ltd, of Honolulu. an
established building and loan associa
ton with total resources Of Sl.250,000.