The Reconstruction Finance Corporation was established by an act of Congress in 1932 as an independent agency of the United States government. Herbert Hoover modeled the organization after the War Finance Corporation which had been previously established during World War I.
The RFC supported state and local governments, and made loans to banks, railroads, mortgage associations and other businesses. The agency gave $2 billion in loans which were almost entirely repaid. In 1933 the RFC was furthered in its activities by the New Deal policies of Franklin Delano Roosevelt, playing a key function in the government’s dealings with the problems associated with the Great Depression.
The RFC functioned throughout World War II and was finally disbanded in 1953 by another act of Congress. In 1954 the RFC was transferred to the Department of the Treasury so that its affairs could be successfully concluded, and by 1957 the agency no longer existed.
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Jesse H. Jones