SATISFACTION-Of morgages upon maturity of stock.. SCHEDULE OF PROPERTY...... SECRETARY-How elected... SECRETARY OF STATE-Certified copy of articles to be filed with.. Must issue certificate of incorporation... SECURITY ON MORTGAGES. Held by corporation, how disposed of.. Majority of subscribed stock must be represented at all elections.. 120 354 SUCCESSORS-Directors to serve until successors are elected and quali fied... 14 326 T TAX-None to be paid on the issue of certificates of stock.. TESTIFY-Refusal to appear and testify before Board of Commissioners of Building and Loan Associations TIME-Limit to existence of corporation ........... VACANCIES-Stockholders may till.. V Caused by removal of Directors, how filled VERIFICATION—Application for dissolution must be verified.. VOLUNTARY DISSOLUTION-Of corporation... VOTE OR ELECTION-May be set aside. In person or by proxy W WITHDRAWAL OF STOCKHOLDERS.. 132 359 WRITTEN ASSENT of two thirds of stock sufficient to adopt by-laws REPORT. OFFICE OF THE BOARD OF COMMISSIONERS OF THE SAN FRANCISCO, CAL., May 31, 1894. To his Excellency H. H. MARKHAM, Governor of the State of California: In accordance with the provisions of Chapter CLXXXVIII, Statutes of California, we submit herewith our First Annual Report, covering the work of this Commission for the fiscal year from June 1, 1893, to May 31, 1894, inclusive. It embodies the statements of 137 Building and Loan Associations, of which 127 are known as Locals, 8 Nationals, and 2 Coöperative Banks; together with a summary of all special lines of statistics drawn therefrom, and such observations concerning the status and management of Building and Loan Associations in this State as we deem of value to the general public and the organizations themselves. The Building and Loan Associations of California have gross assets amounting to $20,820,082 18. They hold capital invested by members, $13,843,986 61, and accrued earnings to the amount of $4,451,490 20. They have loans outstanding which aggregate $19,868,041 48, for which they hold real estate mortgages and bonds and hypothecated stock as security valued at $37,210,762 68. During the past fiscal year they have collected from members in dues $3,759,003 85, and from borrowers, in premiums and interest, $1,887,079 93. They have also received, on loans repaid, $2,195,939 08. In the same period they have disbursed in loans $4,651,389 64; have paid to retiring members on canceled and matured shares, $2,603,333 09 (refunded capital), and $641,089 22 as profits thereon. The aggregate profits of the associations for the fiscal year have been $1,448,920 97. Of the 137 Building and Loan Associations reported, all except three show a net profit on the year's business. We submit that it is a successful line of business that, in times like the present, and under so many different managements, maintains an investment of over twenty million dollars, and makes a net profit of 7.77 per cent on the entire working capital. Taking the total assets as a basis, the Building and Loan Association business of the State is divided among the three classes, as follows: Locals Cooperative Banks $7.99 per cent. 6.52 per cent. 5.49 per cent, 100.00 per cent. The total membership of Building and Loan Associations is reported as 34,169; the number of borrowers, 8,972. The average loan per borrower is $2,214 20. The average investment of stockholders in dues and accrued earnings, per capita, is $535 44. DESERVED POPULARITY OF THE BUILDING AND LOAN PLAN. It is apparent from these figures that the Building and Loan plan of investment is both popular and profitable, and it is of service to a large number of people by enabling them to acquire homes of their own, to be paid for out of their savings from month to month. Without doubt a Building and Loan Association organized on proper lines and honestly conducted, is one of the most beneficent institutions of our time. It encourages thrift and persistent effort on the part of wage earners and people with moderate incomes; it is a potent factor in building up towns and cities; it performs a valuable service for the commonwealth, by helping to establish a well-to-do population in homes of their own. People thus fixed in their habitat and having property interests to guard, make the best class of citizens. The Building and Loan plan of mutual investments addresses itself particularly to those who need encouragement in self-help, and it has been called, not improperly, the poor man's savings bank. That it is one of the safest, as well as one of the most remunerative forms of investment, is attested by the history of such institutions, not only in this State but in every State and Territory of the Union. STOOD THE TEST OF A FINANCIAL PANIC. We may point to a very forcible illustration of the safety of such investments, as shown in the financial panic which overspread the country during the summer of 1893. Not a single Building and Loan Association in California was forced to suspend operations by reason of the financial stringency. Upon none of them was precipitated such a trying ordeal as that sustained by many of the best banks in a "run" of depositors. The reason for this is found in the fact that Building and Loan Associations, as a rule, command the entire confidence of their stockholders, and the plan of organization is such as to render a panic among them, tending to a sudden withdrawal of the resources, an utter impossibility. A large number of investors in the stock of a Building and Loan Association might, under sudden impulse, present notices of withdrawal, but according to the laws of this State an association is not obliged to appropriate more than one half of its monthly income to the liquidation of such stock. Hence, there is abundant means for an association to protect itself without exhausting all of its cash assets, and a run would be rendered harmless. As a matter of fact, throughout the late financial flurry there was no general or extraordinary movement for the withdrawal of stock, although the percentage of withdrawals may have been somewhat increased in consequence of the general stringency. Many associations continued to retire stock in the usual way and to make loans to their members at a time when to obtain money from savings or commercial banks was an impossibility. This free movement of capital maintained by Building and Loan Associations undoubtedly had much to do in relieving the tension of the money panic and restoring confidence to the business community. The history of these institutions in California goes to confirm the world-wide verdict that this is the most successful form of financial cooperation ever devised for large classes of people. |