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L*lu3
FEDERAL RESERVE BANK
of KANSAS CITY
M A Y 1 0 1957
BANKING R j
IN APRIL 1957
Summaryo Total loans and investments at all commercial
banks rose substantially in April largely reflecting increased
holdings of U 0 So Government securities but loans and holdings of
other securities also rose* Demand deposit and currency holdings
of businesses and individuals increased considerably more than the
usual seasonal amount® Time deposits rose further» Net borrowed
reserves of member banks increased sharply early in April but
declined somewhat in the latter part of the month*
Bank credit* Preliminary estimates indicate that total
loans and investments at all commercial banks rose about $1*8
billion in the April reporting period (from March 27 through
April 2k) with increased holdings of U* S» Government securities
accounting for about three-quarters of the rise, as shown in
Table 1* Commercial banks initially took most of the #3*1* billion
of certificates and notea offered for cash on March 28# but subsequently reduced their holdings substantially* In addition, loans
increased $300 million and holdings of other securities about
$200 million* Holdings of other securities have been increasing
since January, when the general downtrend prevailing since early
1956 was reversed* In April last year; which included no new
Treasury financing, total credit increased $200 million# Loans
increased about twice as much as this year, but U» S. Government
security holdings declined, and holdings of other securities
were unchanged* In April 1955, which also included a new cash
offering, total credit increased $2 billion*
Business loans at all commercial banks were probably
unchanged in April as a small reduction at city banks was about
offset by the usual second quarter seasonal expansion at banks
outside the weekly reporting group. Business loans had increased
^Somewhat in April of both 1956 and 1955 but in most previous
years had declined® Net loan repayments by food processors and
commodity dealers continued at a substantial rate but only
slightly above last year's level, as shown in Table 5» Loans to
sales finance companies increased further, bringing outstanding
loans of these concerns about $U00 million above the level in
late February and over $200 million, above the level at tjaa end
of Decembero Loans to trade and petroleum and chemical concerns
also rose, but at a substantially slower rate than last year#
Loans to metals manufacturers, after rising rapidly during most
of the year, declined slightly, and those to public utilities
also fell*
f
Not for publication
- 2 -
L.U.3
Table 1
Estimated Changes in Loans and Investments at All Commercial Banks
tin billions of dollars)
Item
Total loans (excluding
interbank
Business
Real estate
Security
Agricultural
Consumer
I All other
Mar* 28, Mar, 29)
1956 1957 Apr, 2hi Apr. 25,
1956
1957
+ 0.3
+ 5o6
+12.1
+ 0»3
+ 0.3
+ 1.6
+ U.3
+ 1.2
2/+ 7.2
!/+ 2,2
K.s
+ 0.6
- 0.6
— 0*6
+ 0.5
+ 1.1
+ 0.2
+ 0.1
*K.i
•• o.U
-1=5
•* 3®U
- l.U
- 7.U
+ 0.5
- 0.1
+ 0,1
- o.U
«p l.U
—
+ U«3
+ U*3
+ 0*2
Business
Real estate
Security
Agricultural
Consumer
All other
+ 1.9
+ 0.1
+ 0.1
- 0,1
Other securities
Total loans (excluding
interbank
- 0oU
Hi
+ 0*2
+ 1*3
Item
+ 0«6
+ 0.2
- 0,1
U, 8* Government securities
Total loans and investments
(less interbank)
Dec* 27# Jan* 1,
Year ending t
1956 1956 Apr. 2U# Apr. 25, Apr. 2kt Apr* 25j
1956
1957
1956
1957
+ I08
- 0.1
y
+ 0,2
— 0.2
- 0.2
+ 0.1
Ic6
- 0.1
1/
* + 0.1
- 0.1
+ 2*2
+ 0,8
Jan© 1^ J an 0 1 # Jan9 1, Jan. 1, Jan. 1, Jan. 1,
1950 1951 1952 1953 195U 1955 Apr,
26#
Apr.
25,
Apr.
30
Apr* 27, Apr. 28, Apr. 29s
s
1950
1951
1952
1953
195k
1955
l.U
- 1.1
+ 0.7
+ 0.2
* 1,7
+ 0,6
+ 0.7
- 1.0
- 0,1
- 0.7
0.3
«* 0.2
— 0.8
- 0.6
+ 1.7
+ o.U
+ 0.3
— 0*6
0,3
+ 0.8
+ 0©2
+ 0.5
+
+
+
0.3
0.5
0.1
0.9
0,2
+ 0.2
+ 0.1
+ 0.2
1/
+ 0.1
0.6
0.2
0,3
0.1
+ 0.6
— 0.3
U. S. Government securities
- 3.U
* 1*3
- U.U
•» 1*0
- 3*5
• 1.5
Other securities
+ 0.7
+ 0.5
+ 0.3
+ o.U
+ 0.2
+ 0.8
+ 0.2
1/
Total loans and investments
m 0.1
- 1*7
- 1.2 - 1,9 • 3*6 — 0.6
(less interbank)
1/ Less than $$0 million.
2/ Level of business loans increased by# and real estate loans decreased by#
"" $300 million at end of October 1955 to correct classification errors, No^
back figures revised? most of the misclassification probably occurred during
1955.
Note*
Data for April 1957 are estimates and subject to change. Preliminary
data for April will be shown in the Board's statement, "Assets and
Liabilities of All Banks in the United States" available at the end of May.
Not for publication
L.l*.3
- 3 Table 2
Changes in Commercial and Industrial Loans
(IrTlnlllions of dollars]
Business of Borrower
MarI28) Mar,29,
19561957Apr.2l*g Apr,25,
1956
1957
Total change
1/
1956
1955
-2l*6
- 81*
+ 61*
- 80
+ 91
THE
-183
+186
4*09
-369
+ 1*9
-729
+ 92
+ 1*1
+227
-280
+301*
Sales finance
Classified
Unclassified
1957
-378
-337
— 60
- 75
All other - total
Metals and products
Textiles, apparel
and leather
Petroleum, coal, etc®
Other manufacturing
and mining
Public utilities
Construction
All other types of
business
First seventeen weeks
- 55
Food processors
Commodity dealers
Trade concerns
Total
+801 +1,690
rli
+
6
1953
1952
-397 -1*53
-302 -1*17
— 60 +182
"-7!?9
-653
-1+38
-111
195U
-230 -
1
-328
+ 620 +1,030
"mi
7913
-ryg
+7L-6
-103
-=iW
+11*3
+ 83
+139
+261
+185
+271
+ 60
- 52
+232
- 7 + 26
- 19 + 100
5
+ 25 +
+ 67
- 87
+ 38
30
- 72
T&9
+ 1
1/
+ 129
+ 50
-
1
+ 30
+ 57
+ 11
- 35
+ 2
+ 18
.118
+ 28
+123
+105
— itl
+187
- 2
+ 59
+ 98
+ 31
- 19
- 21
-151
- 1*0
+ 30
- 28
— 56
+ 18
+ 50
+252
-172
+322 -1,092 - 70
+1,167
3/ -106 - 187
2/-200
+ 51
-5oi
- 1*7
- 8k
+ 98
+ 80
+1,218 2/+122|2/:1,197 - 257
-51*8
-
+155
- 26
Prior to week ending January 11, 1956, included changes in agricultural loans.
2/ CCC certificates of interest, which are included in data, may have declined
*™ $300 million,
3/ CCC certificates of interest, which are included in data, may have increased
*™ $125 million.
Notes
Classified data are for a sample of about 210 banks reporting changes in
their larger loans; these banks hold over 90 per cent of total commercial
and industrial loans of all weekly reporting banks and nearly 70 per cent
of those of all commercial banks. Data are preliminary for week of
April 21*, 1957.
Not for publication
— ii. -*
Not for publication
So far this year, business loans at all commercial
banks have increased $300 million compared with $1.6 billion in
1956 and $700 million in 1955® In many previous years, however,
these loans showed a net decline for the first four months of
the year. Half of this year's growth was at banks in New York
City in contrast with less than a quarter in the comparable
period last year* This shift was due in part to the fact that
sales finance companies, whose borrowings recently have been
concentrated in New York, increased their borrowings this year
whereas last year they paid off bank debt. Following the
exceptionally large expansion in the second half of 1956, net
loan repayments by food processors and commodity dealers were
considerably larger than a year ago but the decline in 1956 was
much less than the usual seasonal reduction. Net borrowing by
other businesses was about half as large as last year, but, in
general, not unlike other recent years.
Real estate loans declined further at city banks in
April but probably increased at other bankse So far this year,
these loans have shown little change at all commercial banks
compared with last year's $600 million rise* Consumer loans at
all commercial banks, which had changed little during the first
quarter, probably increased about $100 million in April$ in the
January—April 1956 period they had increased $500 million.
Agricultural loans declined slightly in April, but on balance
have shown little change thus far this year compared with a
small decline last year. Security loans increased somewhat reflecting expansion around the time of the Treasury financing in
late March®
So far this year, total credit at commercial banks has
declined $1„U billion, slightly less than last year, and ©lightly
S o r e than in 1955. Expansion in April offset more than half
the $3«2 billion cumulative decline since the end of December,
most of which occurred in January* Total loans declined about
IU00 million whereas they rose about $2 billion in 1956 and Sle5
billion in 1955. Loan liquidation was unusually large in January
this year, but subsequent expansion, while smaller than in 1956
or 1955, has been substantial. Holdings of Ue S* Government
securities, however, declined much less than in earlier years,
reflecting in part acquisitions in late March* Prior to that,
this year's decline had been about the same as a year ago*
Holdings of other securities increased #500 million, comparable
with most other recent years except 1956 when they had declined.
Deposits and currency. Preliminary estimates indicate
that demand deposits and currency held by businesses and individuals increased about $1 billion more than the usual seasonal
amount in April, as shown in Table 3» This more than offset the
decline in the money supply on a seasonally adjusted basis, which
had occurred during the first quarter. At the month-end, the
seasonally adjusted money supply was slightly less than one-half
per cent above the year-ago level. This is about the same yearto-year change as at the end of March, there having been a large
rise in April last year as well.
L.iu3
•* 5 -•
Table 3
Estimated Changes in Deposits and Currency
(In billions of dollars]
Ear7"5r, Ear. 29, Dec, 27, Jan, 1,
Item
Seasonally adjusted data* 1/
Demand deposits adjusted
Currency outside banks
Total
Unadjusted data
l/
Demand deposits adjusted
Currency outside banks
Total
Time deposits
U, S, Government deposits
Total
Year ending:
1956 19561956 1957 Apr• 2h> Apr, 25, Apr, 2U, Apr, 25, Apr, 2U, Apr, 25,
1956
1956
1957
1956
1957
1957
+ 1*2
- 0,1
+XT
+ 1.3
+ 1.6
z
+ 1,7
- 0*2
+ 0,5
+ 0*3
+ 0.8
- 0,3
T${
3/- Itelt
m
1/- o i l
+ l.U
— 0»3
+ ioi
+ 0,2
+ 0*3
+ 0.5
+ 1@6
+ 0,2
+ l«b
—
~
+
+
—
3o8
1„3
+ 0,2
+ 0< 3
0.9
0,6
3«6
+ 5*8
* Oeh
+ 5.8
+
+
+
+
—
+
5a
'+ o*5
1.6
0,3
l j
3*1
0o6
ti.i;
(signs indicate effect on depositsand currency)
Factors affecting deposits
and currency
Bank loans and investments
other than United States
+ 8,0
+1L,1
+ 0,6
+ 0,9
+ 0o7
Government securities hf
+ 5.7
+11.7
+ 6,1
+ 0,15
+ 0«5
Commercial
+ 0.8
+ 0.9
+ 2»U
+ 2.5
+ 0,2
+ 0,2
Mutual savings
Bank holdings of U, S.
— 8,ij.
- 2,0
- 5«o
Government securities:
+ lclt
- 0.9
— 3,2
- 0,1
+"0.1
— o,u
— lob
Federal Reserve
- 1.5
— o.u
- l.h
o,U
Commercial
— 7.U
—
— 1.5
- 3.U
+
m 0,6
+ 0,1
- 0,1
— 0,5
2/
Mutual saving and other
2/'3
Gold stock and foreign
+ 0,5
+ 0.1
+ o.U + 0,1
deposits at F, R, Banks
2/
2/.
+ 0.1
- 1.2
- 0.7
- leti
- o,U
- 0o3
Other factors
Seasonally adjusted data are for last Wednesday throughout; unadjusted data are
V
for last Wednesday except in case of June and December call dates, when
available.
Less than $50 million.
Changes between December 26 and December 31, 1956, are estimated as follows:
Demand deposits adjusted, +#700 million; currency outside banks, -$100$ time
deposits, +$300 million; and U, S. Government deposits, -$300 million*
Total includes foreign loans on gold, holdings of bankers' acceptances at the
Federal Reserve, and loans to foreign banksj changes in these items are
generally relatively small. In addition even if there were no changes in
these items, changes at commercial and mutual savings banks would not add to
total change which is "net" because commercial banks exclude all interbank
loans, domestic and foreign; in addition, there are probably some bookkeeping
discrepancies among various banking records.
H,
y
Note: Data for April 1957 are estimates and subject to change• Preliminary
data for April will be shown in the Board's statement, "Assets and Liabilities
of All Banks in the United States" available at the end of May,
Not for publication
Ue S, Government deposits at commercial banks increased
sharply on March 28, when payments were made for the $3eh- billion
of new certificates and notes* Subsequently# however# they declined steadily, and on April 2k were only $500 million above the
level a month earlier#
Time deposits at commercial banks may have increased
about SUOO million further in April compared with little change
in the same month last year* Although this rise was considerably
smaller than in March, time deposits usually increase less in
April than in March* During the first quarter of the year, time
deposits at all commercial banks had increased about $2 billion,
considerably more than in any other year on record. At mutual
savings banks, deposit growth in January and February was generally less than in other years, but in March and April probably
equaled that of a year ago*
On balance, total deposits and currency increased about
$2 billion in Aprila As noted above, commercial bank credit increased substantially and mutual savings banks and the Federal
Reserve Banks also added to their loans and investments. Last
year in April, while the increase in demand deposits adjusted and
currency was about the same as this year, U» S, Government deposits
declined sharply and time deposits were unchanged, and, on
balance, total deposits and currency declined about SUOO million.
Bank reserves. Net borrowed reserves of all member
banks averaged $U90 million in April, about $175 million higher
than in March, as shown in Table ha Central reserve city banks
in New York accounted for most of the increase* Borrowings at
all member banks averaged over $1 billion, the first month they
have been that high since April a year ago, but excess reserves
continued at about $500 million. The effective trading rate on
Federal funds was consistently at 3 per cent.
Reserve positions fluctuated widely during the month.
They tightened substantially early in April, particularly at
banks in New York City, with net borrowed reserves averaging
$6?0 million during the three weeks ending April 17, In the two
following weeks ending May 1> net borrowed reserves declined to
B315 million, with most of the reduction at central reserve city
banks in New York and Chicago
Over April, as shown in Table 5> more reserves were
absorbed principally through increases in required reserves,
currency outflows, and increases in nonmeniber deposits and other
Federal Reserve accounts than were supplied through System purchases of U, S, Government securities and increases in Federal
Reserve float. Most of the increase in required reserves occurred
during the week of April 3 when bank credit expanded sharply as
banks purchased new Treasury issues. In addition, during the
Not
for publication
E«Uo3
•* 7 Table b
Free Reserves
(Excess reserves minus member bank borrowings;
based on average of daily figures; in millions of dollars)
Period
All
member
New York
Chicago
Reserve
City
Country
M 26
- 338
550
338
-
353
336
298
b29
b68
356
•
-
382
296
2b6
193
203
379
310
319
32b
205
305
360
27b
380
358
393
195b $ December
1955$ December
b59
- 2b5
- 50
- 161
~
-
16
83
19 £6 j
January
February
March
April
May
June
July
August
September
October
November
December
-
255
266
b08
533
«
«
-
195
139
339
213
195
15b
36
- 198
- 138
- 17b
« 167
- 88
- 33
- 108
«• 158
- 20b
- 192
- 21b
- 91
.
~
-
83
103
256
262
153
111
U8
72
93
lib
-
86
January
February
March
April
117
- 126
- 316
- 1*89
- Ll
- 123
- 101
- 300
- bo
- 53
- 253
- 210
-
172
2b9
2b2
263
369
299
280
28b
Quarterly averages
1955: First
Second
Third
Fourth
25b
158
- 127
- 365
- 29
1
- 112
- 192
-
- 99
- 150
- 323
- bl8
b57
37b
375
3bl
-
- 170
- 96
- 157
- 166
- Ib7
- 175
- 71
- 113
-
329
bl8
3bl
2lb
336
278
338
365
- 108
-
- 115
- 221
316
»
•»
-
- 78
- 169
- b82
— I4.26
- 236
- 82
-
*
-
369
133
301
298
383
173
1957*
1956:
First
Second
Third
Fourth
1957: First
- 5ob
310
101
230
128
210
707
6bl
660
333
298
88
- lbo
75
6b
67
95
3b2
bib
212
229
21b
123
- 3bb
1957*
Marsh 27
April 3
10
17
2b
May
1
Note?
Data for second half of April and May are preliminary.
Not for publication
159
257
2b8
303
266
263
3bb
Lelu3
first half of April# currency in circulation increased and Treasury
and other deposits at the Reserve Banks were built up# System
holdings of U» S* Government securities increased $190 million#
on the average# during the three weeks ending April 17* During
the two following weeks ending May 1# however# a considerably
larger volume of reserves was supplied to banks through the intramonthly seasonal increase in Reserve Bank float# currency inflows#
reductions in Treasury deposits at the Reserve Banks# and declines
in nonmeniber deposits and other Federal Reserve accounts than was
absorbed through reductions in System holdings of U. S. Government
securities and small increases in required reserves.
During the first quarter of 1957# net borrowed reserves
of member banks had averaged $110 million# little different from
the $130 million average in the fourth quarter of 1956. The volume
of reserves supplied to banks during the first quarter of 1957
(based on three month averages of daily figures) principally through
currency inflows# foreign transactions# and reductions in required
reserves was about the same as the volume absorbed mainly through
reductions in holdings of U„ S, Government securities and in Reserve
Bank float*
System holdings of U, S. Government securities increased
slightly between March 31 and April 30. Repurchase contracts#
which had totaled $110 million on March 31 and which rose to $230
million on April 3 when reserve pressures were heavy, were gradually
eliminated over the remainder of the month* In mid-April# however#
the System purchased $130 million of bills outright. During the
first quarter of 1957# holdings had declined $1#770 million reflecting reductions of $2,030 million in January and February and
net acquisitions of $260 million in March.
Not for publication
•w 9 •*
L»U,3
Table 5
Changes in Member Bank Reserves, with Relevant Factors
(Monthly average of daily figuresj in millions of dollars)
Jan* - April
"April
Item
1956
1957
Year ending ApriT
1957
1956
1957
1956
Member bank reserve balances
Total
Required reserves
Excess reserves
+ 203
-
77
- UU8
- 393
+ 2U0
+ 199
+
U
-
20
57
- 318
» 326
+ 21*5
Effect of above
factors on reserves
-
67
-
5
+ 110
-
63
(signs indicate effect on reserves)
Principal factors
Currency in circulation
Gold stock and foreign
accounts
Treasury operations
Federal Reserve float
Other factors
- 130
k7
-
15
+
11
+1,162
+1,020
- 368
- U38
—
+
2 It
12
35
8
62
7
• 395
+ 29
- 523
- 289
+ 167
- 107
- U6it
+ 568
- 183
+
-
28
+ 185
- 129
+
+
+
+
- 151
-
31
+ 77-U
+ 588
+ U2lt
- 205
+ 356
-
h6
-1,221
- 977
I - 181
+ 252
+ 178
TIE
+ 5U
+
l
- 112
-
56
56
1
-1,526
-1,377
- 1U9
- 25
-1,192
-955
- 171
~57?
+ 101
+ 11
- 222
-""211
- 11
1
+ 177
+
67
+ 323
+ 221
**
«
+
+ 565
+
+
86
-
+ 168
87
10
87
1x9
Federal Reserve loans and
investments:
Total
U e S. Govt* securities
Outright
Repurchase agreements
Acceptances
Discounts and advances:
To member banks
To others
1/ Data for April 1957 are preliminary.
Not for publication
7
- 267
-
5
1
U9
25
-
90
w
L*U.3t
10 —
Loans and Investments at All Commercial Banks
(in billions of dollars)
Loans
and
investments
Date
Other
Gov't® secur- Total
secur- ities loans
ities
Uo So
ConReal SecuAll
Business estate rity Farm sumer other
9.U
2.1
19U7*
19U8:
19U9s
1950$
1951$
1952$
1953$
195U$
Dec.
Dec,
Dec.
Dec.
Dec*
Dec.
Dec.
Dec,
31
31
31
31
31
31
31
31
116.2
11U.2
120.1
126*6
132.5
1U1»5
1U5.5
155.7
69,2
62*6
67,0
62.0
61,5
63*3
63.U
69.0
9.0
9.2
10.2
12.U
13.3
iua
1U.7
16,3
37.9
U2.U
U2.9
52.2
57.6
6U.0
67 »U
70.U
18*3
18.9
17.1
21.9
25.9
27.9
1955$
Mar. 30
June 30
Sept.28
Dec. 31
152 .U
15U.8
156.U
160.3
6U»2
63*3
62.0
61.6
17.0
16.8
16.9
16.7
71.2
7U.8
77.5
82.0
27.U
28.9
30.5
1/33.2
Jan, 25
Feb. 29
Mar. 28
Apr. 25
May 30
Jyne 30
July 25p
Aug, 29p
Sept.26p
Oct. 31p
Nov. 28p
Dec. 26p
Dec. 31e
158,3
157.1
158.5
158.7
158.U
159.3
158.3
159.8
160.7
161.3
162,6
16U.U
16U.U
60.9
59.2
58.6
58.2
57.3
56*6
56.2
57.2
57.0
57.U
58.1
58.3
58.U
16*5
16,6
16.6
16.6
16.U
16.5
16,3
16.U
16.5
16.3
16.3
16.2
16.3
80.9
81.2
83.3
83.9
8U.7
86.2
85.8
86.3
87,2
87.6
88.3
89,9
89.7
32*7
32,9
3k. 5
3U.8
3U.8
20.9
35.8
36.U
36.9
37*2
37*8
38.8
38.7
21.9 U.3
22,1 U.O
22*3 U.I
22. U U.l
22.5 U.o
Jan.
Feb.
Mar.
Apr.
161.5
161.0
161.2
163.0
57.5
56.6
55.5
56.8
16.2
16*3
16.5
16.7
87.8
88.0
89.2
89.5
37.6
37*8
39.1
39.1
22.6
3.7
22.6
22.6
3.6
3.8
1956$
1957$
p e 1/
~
30p
27p
27p
2Ue
27.2
26,9
36.1
10.8
11.5
13.5
1U.6
15.7
16.7
l8oU
2.3
2.6
2.9
2.6
3.2
3.6
U«5
1.7
2.9
3.1
2.9
3.U
3.9
5,0
5c2
3.8
U.8
5.8
7 eU
7.5
9.U
10.9
10.9
19.0 U.i
19.8 U.5
20.6 U.2
U.9
u»u
з.9
U.5
11.2
U.6
U.U
U.5
U.U
U.3
U.U
14.3
U.2
U,0
U.2
ii.O
U.l
U.2
U.2
13.3
13.3
1/20.8 5.0
21.0 It.5
21.2 U.5
U.U
21.6 U.5
21.8 U.U
21.U
22.6 U.3
22.6 1.3
22.6 3.7
U.3
и.u
U.3
U.2
12.1
12,7
13,2
13.5
13.7
13.9
1U.3
1U.U
1U.U
1U.5
1U.5
1U.5
1U.7
1U.7
1U.6
1U.6
1U.7
1U.8
Preliminary
Estimated
Level of business loans increased by, and real estate loans decreased by >300
million at the end of October 1955 to correct classification errors. No back
figures revised; most of the misclassification probably occurred during 1955#
Note*
"""""""
Data exclude interbank loans. Total loans are after and types of loans
before deductions for valuation reserves. Consumer and "other loans" are
partly estimated for all dates. Other data are partly estimated on all
but June and December dates. Data for December 31# 1956, and April 2U#
1957, are estimates and subject to change. All data for December 31*
1956 are based on preliminary member bank call report data.
http://fraser.stlouisfed.org/
Not for publication
Federal Reserve Bank of St. Louis
Banking Section, Board of Governors
May 7, 1957 .
@FedFRASER