PART III. CO-OPERATIVE BUILDING AND LOAN In reply to appropriate schedules forwarded by the Bureau, as required by law, returns have been received from all except one of the 272 building and loan associations known to be in operation in this State near the close of the calendar year. The exception is the "Progressive," a very small concern composed of few colored residents of Newark, last year but seventeen, holding twenty-three shares, aggregating in value $2,286. All these associations were incorporated in New Jersey. Neither this office nor the Banking Department has any positive information that outside corporations are transacting business in this State, several applications made under Chapter 251, Laws of 1890, to the latter office, for legal permission to act here not having, as yet, been perfected by furnishing the required deposit of securities. The returns furnished to the Bureau this year were, with exceptions, fairly satisfactory. While many of the statements were not verified, and a not inconsiderable portion of the officials neglected to send in the required information until after several notifications, in only three instances (out of the 271 associations) was there an absolute failure to fill out the schedule prepared by this office, copies of incomplete annual associational reports being returned instead. Explanations going to excuse their dereliction were made by two officials; and in but one case, that of the Cape May City Building and Loan Association, was there a curt refusal to comply with the legislative prescription of 1890.* *Chap. 261. Of the 254 associations incorporated before September, 1890, and in operation before the close of that year, five have dropped out: the "People's," of New Bruuswick, a terminating association, matured its shares in February, 1891, in 132 months; while the "Homestead," of Jersey City, after a few months' existence, the "Enterprise," South Amboy (incorporated in 1873), the "Mutual" (1869), Moorestown, and the Paisley Building and Loan Association (1888), Burlington county, all serial, liquidated their obligations and closed up their business. The "Glenwood" (1890), Jersey City, was also preparing to transfer its mortgages and cease operations in the early part of 1892. Its report, however, has been included in the returns below. The Bordentown Association, organized in 1880 as a terminating scheme, started a new series in October, 1890, and matured its old shares in March, 1891. Of the new organizations incorporated during the twelve months ending September 1st, 1891, in the several county clerks' offices, 23 were in operation in time to make returns to the Bureau, and are distributed as follows among the respective counties: Bergen, 2; Camden, 5; Essex, 5; Hudson, 5; Mercer, 2; Middlesex, 1; Monmouth, 1; Somerset, 1; Union, 1. These comprise 16 serial, 2 terminating and 5 so-called perpetual enterprises. Of the latter, 3 are "nationals," that is, they are not restricted to local or even State operations. Five nationals are known to have been incorporated in New Jersey, thus far. The net gain in the number of State building and loan associations since the last report of the Bureau (1890) thus has been 18, making the total 272. In this total are included one small association, already noticed, composed entirely of colored citizens of Newark; two whose membership is almost, if not entirely, Italian; and several where the German element largely, or exclusively, predominates. In at least one association in Newark and three in Elizabeth, the reports are only issued in the German language, and it is the general practice in the former city to print them in both German and English. This seems to indicate the popularity of these enterprises among the German citizens. The development of the building and loan movement in New Jersey during the past six years is shown by the following table: As will be noticed, the terminating associations have decreased from 30 to 27 since 1890, when they comprised 12 per cent. of the total number; now less than 10 per cent. The serials actually have increased by 16, or a little over 7 per cent. They constitute nearly 86 per cent. of all. The perpetuals show an absolute increase of 5, from 7 to 12, that is, 71 per cent. The latter plan of association is not to be commended. As was remarked in the previous Bureau report, it is nothing but the serial scheme, except that each share, or block of shares held by any one individual, is treated as a separate series. Besides other drawbacks, it requires a great amount of unnecessary labor on the part of the secretary to divide the profits, periodically, among the respective share accounts. That is difficult enough, when done fairly, in the serial association. Three of the five nationals organized in New Jersey, are conducted on the perpetual scheme. The main objection to the terminating plan the one-series association, where all stock is taken and matures at the same timeis, that after the first few years of its existence there is no further demand for loans by members. Hence, the money coming in must be placed outside of the association membership or remain idle, unless the course, most decidedly to be condemned, obtaining in a few Jersey City organizations is followed, of running the association heavily in debt to the banks for money to be loaned to borrowers during the earlier years of its life, trusting to repay the debt with the income received later from the members. There is no excuse for terminating associations in an urban locality, and when they are organized it almost invariably will be found that the same individual is secretary of two or more and is thus enabled to charge several salaries, office rents, &c., which would not be possible were the associations run as different series of the same organization. It costs no more to manage a serial than a terminating association; while the former has many advantages over the latter. Outside of the newly organized "homestead" association in Camden, the only urban neighborhood where the terminating enterprises flourish are Jersey City, 8; New Brunswick, 6; and Perth Amboy, 4. In the first city, one individual is secretary of four, and one of two of these enterprises. In the second, New Brunswick, there are four secretaries to the six associations, and in the third, one to four. The returns from the 271 associations tabulated below are based on their latest annual reports, made at the close of the respective associa |