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Twenty-fourth o/tnnual ‘‘Report
of the
FEDERAL RESERVE BANK
OF PHILADELPHIA
1938
Third Federal Reserve District
CONTENTS
Page
Letter to stockholders.....................
4
Business conditions...............
Industry ...........
Income .............
Distribution ...............................
Prices .............
Survey of credit and capital requirements
Banking and credit conditions..................
Bank reserves...........
Federal Reserve Bank.............
Member banks.....................
Condition of member banks..................
Deposits .................
Loans and discounts....................
Investments .................
Earnings and expenses............
Capital funds .................
Money rates...................
federal Reserve Bank..............
Reserve bank credit...............
Industrial loans........
Volume of work............
Earnings and expenses.....................
Membership ..
Changes in officers and directors. ...
5
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FEDERAL RESERVE BANK
OF PHILADELPHIA
June 10, 1999.
'1 o the Stockholders of the
Federal Reserve Bank of Philadelphia:
There is presented herewith the twenty-fourth
iinnual report of this bank containing a review
of business, banking and credit conditions in the
Third Federal Reserve District, together with an
account of the operations of this bank during
1938.
John S. Sinclair
President.
Business conditions
Business activity in the Third Federal Reserve District de
CllDed preciPitously from the middle of 1937 until the late
J’ling o 1938 but showed marked improvement throughout the rethe f L1(/ t?le year- As the demand for goods and services expanded and
iquir ation of inventories became more effective, general sentiment
w optimistic with respect to business prospects.
s )!■'
,
f
imt
conditions at the close of the year showed a substantial
mci .°VfIne,.lt' over a year earlier. Inventories were reduced, the moveothc ° pr'ces .exh’bited firmness, the demand for metal products and
, / SP,CC1 lc hnes of capital goods was increasing slightly, and retail
how ■ S.U T "6re be^er than a year before. After the turn of the year,
foru^r
slackened and a new hesitation appeared with respect to
lv n *1* ' 0Inni’tinents, reflecting the influence of the uncertain outlook in
l"'"1 domestic and foreign affairs.
follow!", t/jllS-ed 'ndex °f industrial production in the twelve months
cent ar
P°'nt reached in April 1937 declined more than 33 per
carried^°W
August 1938, when an advance set in which
in fourt
"" °X "P 17 per cent' Py December 1938 to the highest level
■ndustri T" ly.('nt'is- Despite the gains in the latter part of the year,
spring of 1937^ecember was still well below the peak in the
II
•
‘’Iruction -hb’111 I'1 general business was led by increased residential congains begin ' I?1trade and freight-car loadings followed with
and wholpsnm + .'"i ,Un.e’
Production, employment, wage payments,
general and o !•" C !l< vanced thereafter. Subsequently, the gains were
ditions reach.?!' lnUOUS’ and aP of the major indicators of business conoi approximated the year’s highest levels in December.
was substanHn'iiv1!'111’ ,'pward trend, the total volume of business in 1938
wa« >n manuf'aclurhm T".'" \93?' T1‘C sharpest decline for the year
g, where activity showed an average contraction of
s
I wt nty-Jourth Annual Report, Federal Reserve Bank of Philadelphia
PRODUCTION AND PRICES
PERCENT
1923-23 AVG.IOO
INDUSTRIAL PRODUCTION
(pmila. rco ncs.
oist.)|
100
COMMODITY PRICES-US.
(other than farm products
AMD FOODS)
PRICES or RAW MATERIALS
40
1932
1933
1934
1935
1936
1937
1938
5ourc< for Pnc - U.5Bur«au o| tabor Slab.ljc.
24 per cent. Wholesale trade sales followed with a decline of 16 per cent
‘ ,i'ning W“" d0Wn 15 pcr cent- retail trade sales and the output of crude
. H "T
P7 CCnt re9Pectivcly. fa™ cash income 8 per cent, and
total building activity 5 per cent.
The drop in business in 1937 and 1938, which was much sharper
mug i ,tiefer, than that eight years earlier, has been attributed for the
nost part to accumulation of excessive inventories. Stocks of goods in
producing anti distributing channels are estimated to have increased from
to 40 per cent in 1936 and 1937 compared with an improvement of less
than 20 per cent in industry, trade, and income, so that at the end of the
period the supply of goods was out of line with consumption.
Business activity was restrained well into the third quarter of 1938
by the necessity for liquidating these surplus inventories and, even when
Stocks finally were substantially reduced, new purchases were limited
and business establishments generally resorted to hand-to-mouth buyim
intensified form. Buying continued on a restricted basis well h «
1939. Tendencies toward increased forward orders, which appeared shortly
fi
luenty-fourth, Annual Report, Federal Reserve Bank of Philadelphia
Index: 1935 Average = 100
■ n ErnP,Hycc-h«urs
in J cnnsylvania factories
'll manufacturing
•* irst quarter........
jjecond quarter
Hurd quarter
I’ourth quarter.
Average
'^•tnl products
Nrst quarter....
•joepnd quarter ..
* nird quarter...
I’ourth quarter..
Average....
products
Jirtt quarter....
Second quarter..
Nurd quarter
fourth quarter..
A verage
a;<
of the year, faile
• I aced the earlier optimism.
1936
1937
1938
108.4
124.0
131.9
144.8
149.2
153.3
144.7
119.3
90.7
84.9
87.2
100.7
127.3
141.6
90.9
112.7
137.2
144.8
160.5
170.1
178.0
169.6
130.3
93.8
86.0
83.7
100.0
138.8
162.0
90.9
100.6
97.7
107.6
118.4
121.6
112.0
101.6
85.6
79.8
75.2
87.8
97.3
106.1
105.2
85.0
materialize as current uncertainty
of 1937 to'tl'*"'-'n act'v^y declined nearly 35 per cent from the spring
heavy goods'Vl11 -C
owing principally to the reduced output of
variation r
lc lntcx °f factory production, after allowing for seasonal
'hereafter in' W..per cent °f the 1923-25 average in June but
“hove the ve-'^T* Steaddy and hy December was nearly 20 per cent
pan8i°n in the‘LZ
durin<? the summer was led by an ex
type of aetivH°U |'"d
consuraers’ goods but in subsequent months this
''“I’ital BQnrk y 10Wed a tendency to level off, while the production of
fe Jods improved substantially.
dmrpest cains 't,'1’1,1' dn.es’ t'le outpnt of shoes and textiles showed the
than doubled dnrin "aaving of carPcts and rugs, for example, was more
Upended over 50 n • ? yGai &nd tlle output of hosiery and silk goods
traction was in the * ?Cn^' P'°1 ^lc year as a wh°lc, the greatest con'•'Ptflly to the low tveiU f10n Of “etals and mctal products, owing prin''reasc was shown in t
°rP
exPenditures hy industry. Some in
outlook for 1939 was JjTd
the Cnd °f the year’ and the
‘ ■ egarded favorably because of the accumulated de
7
Twenty-fourth Annual Report, Federal Reserve Bank of Philadelphia
preciation in plants and equipment. By the end of the first quarter of
1939, railroad buying was well ahead of the year before and there were
Bigns of improvement in purchases of equipment by selected textile lines,
but the output of capital goods in general had failed to measure up to
earlier expectations.
1 he output of mines in this district was also sharply reduced in
1938. Only 45,000,000 tons of anthracite, excluding the so-called “boot
leg coal, were mined during the year, the smallest amount on record.
1 his volume compared with 52,000,000 tons in the preceding year and
the post-war high of over 93,000,000 in 1923. The reduced demand in
1938 wus due in large part to unfavorable business conditions, but an
important factor in the downward trend since 1923 has been the com
petition of other fuels.
1 reduction of bituminous coal in the State of Pennsylvania also
reached a record low of 77,000,000 tons compared with 110,000,000 in the
preceding year. The principal demand for this fuel comes from industry
inc tiding public utilities, and the decline in 1938 resulted from reduced
industrial activity.
s
twenty-fourth Annual Report, Federal Reserve Bank of Philadelphia
Building activity in this district in 1938 was only slightly less than
u-,, l'C yey ^e,f°re’ °Wlng to a sma11 gain in the construction of public
r 811 r" 1 dleS- Construction of both residential and nonresidential
n the year as a whole was below 1937- Activity in the resi
gn la- c turned UP first> advancing sharply in April and during the
tl,(."i'’ niS. 7tmOntllS' The erection of family houses was stimulated by
11 i '*.' T o- Housing Administration which, according to the records of
c oca o ice, accepted mortgages for new construction in eastern PennSil 500 nun• DelaWare totaling $17,500,000 in 1938 compared with only
j'.’’ tnJ? 1937' Mortsages covering existing construction declined
In nr' ■ ',
$H>000>000. The erection of commercial and factory
i'("Lc'l'nkh 6’’°"ed ^le sharpest decrease in the year, the adjusted index
stpi, i'1.1'^ 1 "" P°*nb ’n July- From then until January 1939 there was
'i > Hnpiovcment, but this gain was less marked than in other types
ot construction.
hnii
than intliq?-’Ut|)1m
sa^es
e^ecfr'c power were only 2 per cent less
cent
’ " ”'e Sa'6S
P°wer 1° industry showed a decline of 9 per
ni'-i'**jc,livc act‘vity
I’hiludelphin Federal
(192S « FVe District
average = 100)
h«lu»trial producti,,,,
Manufacturing
Ourublu goods... '
Nondurable goods.
Coal mining..............
Anthracite..........
bituminous....
I 'rude oil.......
Electric
power output.
Annual averages of monthly
indexes
Monthly
1929 1932 1935 1936 1937 1938
Dec.
1937
Dec.
1938
110
63
76
86
91
70
76
78
111
no
112
61
39
77
73
56
87
84
77
91
89
91
91
68
58
77
71
71
74
76
65
86
92
91
98
60
62
51
65
64
63
69
68
74
65
64
76
56
56
53
68
70
56
66
66
62
230
293
392
433
498
445
531
437
191
177
202
228
242
238
228
248
132
10t
160
146
34
17
41
66
31
18
33
65
56
36
59
108
57
38
70
83
54
35
65
86
66*
30*
102*
73*
181
100
138
149
166
152
153
I,;<,ntracts awarded
Residential..
Nonresidential
1 ublic works & utilities.
A CaCsh1in“rUl “arketing
income f!932 avg8
moving averages.
9
73*
44*
86*
98*
141
Twenty-fourth Annual Report, Federal Reserve Bank of Philadelphia
io
Twenty-fourth Annual Report, Federal Reserve Bank of Philadelphia
Consumer incomes and purchases in 1938 showed a large
1 eduction from the previous year, reflecting the influence of
ui avorable industrial conditions. A large body of unemployed continued
in existence; the index of employment in twelve lines of trade and in1 ustry m Pennsylvania decreased 16 per cent from 1937 to 1938. Wage
payments declined by nearly 25 per cent from 1937.
Index of general em Kelative
ployment and payrolls impor
noon 1 cnnsylvania.
U932avg. = 100; indexes tance.
%of
ore annual averages.)
total
General index*
100.0
Manufacturing...
411.9
Anthracite..........
'
6.9
Bituminous coal.
5.7
Quarrying................. ‘
0.6
'r”de petroleum...
0.2
ublic utilities.........
4.4
‘J^oil trade.. ..
15.8
’’ holesale trade
4.7
I lotels................
1.1
foundries....
0.7
Dyeing and cleaning ..
0.2
‘Includes building
Employment
Payrolls
1935 1936 1937 1938
1935 1936 1937 1938
108
121
86
120
97
193
89
no
106
104
95
94
127
155
89
161
128
170
91
108
100
103
95
101
114
130
84
121
107
178
91
113
111
106
99
100
123
142
81
123
119
161
96
119
118
112
105
105
103
115
70
102
94
145
95
107
113
no
100
104
151
189
85
199
184
160
97
117
107
111
105
108
179
232
81
217
228
171
101
130
119
123
119
120
135
165
66
158
154
165
103
igg
lit
123
121
126
and construction.
low " |01^ emPloyment and payrolls in Pennsylvania reached the year’s
(•ri" I
S 10 dune and
respectively. The index of employment de70 i)0'
Per cent
the 1923-25 average at the end of 1937 to
December 'iqqo ^mi middle of the ensuing year, rising again to 76 by
by Dc i
10 'ndex
wages paid was as low as 61 in July but
higher Yl”* >C'i
made up ad
^le year’s loss, closing at 76, slightly
tory e ' 1 *'
'6V<d Preva'ling a year earlier. For 1938 as a whole, faccent Th'?10011^ Sh°wecl a decline of 19 per cent and payrolls 29 per
Previous 'e . °SS
wagcs on acc°unt of strikes was less than in the two
liosierv o'*!
moa^ seldous difficulties being in the construction and
■ c us ties, where settlements were reached during the spring.
from SV() <HC "C|l y earnings of Pennsylvania factory workers increased
meat was due l anuary 1938 to $24.53 in February 1939. This improveweek by eml ° "i lncrease *n the average number of hours worked per
tills Period' fro™™7®!’ SinCC aVerage hourly earaings declined during
i “wi irom 70 cents to 69 cents.
11
Twenty-fourth Annual Report, Federal Reserve Bank of Philadelphia
Consumers’ purchasing power declined somewhat less than cash in
comes, since the average cost of living was reduced. The index of cost
of goods purchased by wage earners and lower-salaried workers receded
from 84.5 to 82.9 per cent of the 1923-25 average in the country as a
whole and from 83.7 to 82.5 in Philadelphia.
Farm cash income in Pennsylvania, New Jersey, and Delaware in
1938 was approximately 8376,600,000 or 7 per cent less than the year
before, the adjusted index reaching a low in October. In the final two
months of the year, adjusted receipts were increased principally by sales
of dairy and poultry products. Agricultural income was reduced in 1938
by substantial declines in prices as well as by smaller sales. The decrease
in farm purchasing power was slightly less since prices of non-agricul
tural commodities also declined in the year.
Farm cuxli income—
I’ci.n.. New Jersey, Delaware
(In millions of dollars)
1929 .
i‘i:io
1931
1932
1933 .
1984
1935 .
1986 .............
1937. ..
1988.
Crops
Livestock
products
8153.5
132.9
101.7
110.2
103.6
96.6
111.3
123.6
137.7
116.3
8266.4
241.11
194.0
152.4
151.0
176.4
214.2
221.1
263.9
256.2
Government
rental and
benefit
payments
.11
2.3
1.11
3.0
3.2
3.9
Total
8419.9
377.8
295.7
232.6
257.5
275.4
327.3
350.7
404.8
376.6
.
oS Bencrnl rehef a881stance in Pennsylvania amountec
to $7a,979,000 in 1938 as against $57,813,000 in the preceding year, an.
the other principal types of relief expenditures were also larger
Average number
of persons
Public assistance
in Pennsylvania
by type
Amount spent
1937
1938
.
463,000
700.000
86,000
10,000
37,000
612.000
897.000
91,000
12,000
41,000
857,813,200
131,136,000
22,639,500
3,749,000
6,091,000
Total..........................
$75,979,000
166,671,000
23,477,000
4,178,500
7,265,200
1,296,000
1,686,000
8224,428,700
8277,570,700
Direct relief.
Federal work relief.......
Old age assistance .........
Pensions for the blind
Aid to dependent children
12
1937
1938
'Twenty-fourth Annual Report, Federal Reserve Bank of Philadelphia
1
Emergency expenditures by the Federal Government continued
as shown in the following table:
Expenditures in Pent
I infer"R.’/l.'.-Ti" * vnna9> Ncw Jersey and Delaware
i a Emergency Relief Appropriation Aets*
t In thousands of dollars)
' 'cpartmenl of Agriculture..
.''.’T executive departments.
."'"' -'inservation Corps.
. ’ " \\orks Administration (housing, loans and grants
to states, etc.,
VNorkx I’rturpn.... A<ll,,inislrnUon
^110^0,?®^
.......................
util r independent establishments!............ i i
\
i/
Total
1935-1937
1938
$34,386
24,893
43,561
$19,208
10,572
29
20,557
470,253
128,167
6,894
222,644
770
Total..........
$260,117
.''n,,s>l\ ania. .
/‘•w Jersey
Delaware...
$525.581
188.877
7,656
$184,325
73,770
2,022
-• ,
1 oi tne President of the I
l.v I9:!!"ts h) 8tatcs by the Federal Emer.r...wd States to the Confess, January 10, 1939.
•geney Relief Administration were discontinued
'■onipeir -'c1'1"'1^ ^lr<5U^ taxes on employers to provide unemployment
- lOSOOii'tion1-111 1 ennsy^van’a, New Jersey, and Delaware amounted to
Penned,’ J “LJ938 comPared with $99,000,000 in 1937. In the case of
I'l'oxii ■ i ,l|lll l'--'/9’999’999 was codected in each year, and in 193S apdnewplov ?i ’ z“’()09’099 °f the accumulated fund was distributed among
Jersey ■
n'?' '<1S’ '>a^ment °f unemployment compensation in New
three slm , ■ f 7T WaB n°fc started until 1939• Taxes collected in the
iipprcivin,.'? i "L°
a^C Pensi°ns under the Social Security Act totaled
year.
‘‘ '7 ?65’000>000
1938 as against $71,000,000 in the previous
*lai’e S.a’' ' ’n J<J33 Were 10 Per cent less than a year
a. otc, lcllectii.g industrial conditions and reduced incomes,
ever 20 ner
l( lldiusted index of retail trade in this district declined
Subsequently +7 d™ & Wg''
SePteniber 1937 to the 1938 low in May.
Uhusuallv lmJ " C lmPro'ed al»iost steadily, the gains culminating in an
,h'Ht two\n(mU,/°r io,n ’" Christmas business. Sales leveled off in the
o months of 1939 hut improved in March.
bution
I 'r U
nnd reached a\m\j)-llt \'\aitiennt° accumulate in the late summer of 1936
Wuses in ln.m " j-'1' U y 1'.,3z- Almost a year was required to liquidate
many lutes, and new buying was restricted. In December
13
I wcnty-fourth Annual Report, Fedcral Reserve Bank of Philadelphia
1938, after some accumulation in the fall, inventories were 6 per cent
below a year earlier.
t\ holesale trade reached the year’s lowest level in J uly and subse
quently increased sharply. Sales for the entire twelve months averaged
14 per cent less than in 1937. As in retail stores, inventories at wholesale
establishments were sharply curtailed and in December were 24 per cent,
below a year earlier.
Registrations of new passenger automobiles in this district were 46
per cent less in 1938 than in 1937. Following the introduction of new
14
1 wenty-fourth Annual Report, Federal Reserve Bank of Philadelphia
models in the fall, registrations increased sharply and by December exee< d t ie corresponding month of the previous year.
Railroad freight shipments, after allowing for seasonal changes, deioo°St Steadily from March 1937, when the index was 83 per cent
how'6' ■
avera8ei
a low of 49 in May 1938. From that time on,
11 t ieie was consistent improvement, and since December ship
ments have exceeded those of a year earlier.
nfT6
were
I]‘e value of merchandise exported through the Port of Philadelphia
•, i '0I|n $97,002,000 in 1937 to $88,321,000 in 1938, and imports
reduced from $205,949,000 to $104,848,000.
,,, ..Ui8lr>bution
I hladelphia Federal
R^erve District
'1 -'-3-25 average
100)
Annual averages of monthly
indexes
1929 1933
Monthly
1935 1936 1937
1938
Dee.
1937
Dee.
1938
78*
82*
80*
77*
'‘" •ail trade
Sales
—Stocks,..','' " '
"h<de»„ |,.
Sales.
Stocks
Nc
'
i’r ““"""obiles
0"Xey'‘OlVlK(,y31 = 1,K’)
Income—totaY..
Tift car '"“dings
P 7 r?7. district ....
■ml :ylpWii,,,in,(l,r,riHl“™> ■
Ex.K.rL' ,a“, I,,,,ia
'mporlst.. .
/.....................
100
94
59
59
69
66
80
83
83
75
78
98
102
131
63
59
62
79
66
99
86
68
121
97
76
136
84
60
72
97
69
102
86
82
106
107
119
121
123
129
117
122
109
137
106
107
55
62
59
62
70
68
74
70
54
61
78
115
51
108
49
109
41
122
59
136
42
102
C,1»lotnJ|IonSc°r SCUSOnal variation. fIndex
"'ices
58*
63*
89
52
122
101
125
62*
61*
based on tonnage reported by U. S.
Dees declined in 1938, particularly in the case of agriculpriccs, comnil .l'i' ? ta’ll"n(’dit’cs- The index of 813 wholesale commodity
of 88 per
r
’C Bureau of Labor Statistics, declined from a high
spring of 1938° ,
1926 average in July 1937 to less than 78 in the late
Proved, but bv tu 10 sunimer tliere was some recovery as business im
itations on ■„ r T* °,f the yCar the price index had receded to 77.
”f June 1938
1Cldtural stuPles declined irregularly to a low the first
anti, alter a temporary increase in the early part of the
15
Twenty-fourth Annual Report, Federal Reserve Bank of Philadelphia
summer, receded again a August. Since then quotations have fluctuated
narrowly, Prices of industrial staples, after declining sharply until June
1938, increased steadily, until November and have since shown little
change.
Wholesale
commodity prices
(Bureau of Labor Statistics
index. 1926 ■= 100)
Annual averages of monthly
indexes
Monthly
1929
1932
1936
1937
1938
Dec.
1937
Dec.
1938
All commodities (813)
95
65
111
86
79
82
77
Haw materials............
Semi-finished articles
Finished Roods..
9H
91
95
55
59
70
80
76
82
85
85
87
72
75
82
75
78
85
71
75
80
105
100
92
18
61
70
81
82
80
86
86
85
69
74
82
73
68
73
80
Farm products
Foods...............
.
Other commodities.
80
81
Prices of both raw and finished goods during 1938 were disturbed by
widespread cutting to meet competitive conditions, particularly in cer
tain types o steel and textile industries. Wide fluctuations in foreign ex
changes and market conditions, reflecting unsettlement in Europe, also
were a d.sturb.ng factor in the ease of many important raw materials,
such as rubber, lead, and zinc.
Survey of -redit and capital requirements
ascertaining the existence, nature and scope o
■d capital by business establishments of smal
and medium size ...
. bird Federal Reserve District, this bank made
aurvey in Novemb,
„d December 1938, comprising analyses of dat
obtained iron, representative business concerns and banks throughou
this district, an.l rom records of this bank in connection with industri,
advances for working capital to established business enterprises Conic
of this survey are being mailed to the banks in this district Addition,
copies may be obtained upon request.
I or the purpo
16
'I wenty-fourth Annual Report, Federal Reserve Bank of Philadelphia
n
Banking and credit conditions
Bank reserves
Reserves of this bank, consisting of gold certificates and
other cash, increased substantially in the first half of 1938,
reaching a high of 8591,756,000 on June 8. Subsequently,
they declined to 8483,569,000 on September 12, the low for
1 >e \ car, but rose again in the closing months of 1938. On December 31,
total reserves aggregated 8576,918,000 as compared with 8502,331,000 on
December 31,1937.
I ederal
Heserve
t lie following data measure the reserve position of the Federal Re
el ve Bank of Philadelphia and that of all Federal Reserve banks at the
Beginning and at the end of 1938:
•i
^ash reserves of
h/n n,ler.al Rc8crvc banks
lUoIlar figures in millions
as of end of year)
1937
1 otal required .. .
127.2
8576.9
128.2
1,713.4
1,780.7
2,651.8
3,530.8
$4,365.2
85,311.5
,115.8
86,854,3
160.6
$262.1
8288.8
8288.1
191.7%
1938
812,165.8
89,481.0
134.9
Excess reserves
Pr°Portion of total to required....
1937
1938
1 “tai reserves
•Inquired reserves:
Tine!' Fc<teralReserve notes..
K",t* certificates)
AkA'?2>1 ^Posits...........................
, /o in gold certificates or
•awful money)
All Federal
Heserve banks
Pliilndelphiu
199.8%,
j
117.2%
229.0%
atno J°Sf llgUres S'1OW that this bank at the eno
>38 held a sufficient
nn('l' d\ ° ., eserves t° support twice the volume oi
notes in circulation
ell ReUI)°SltS com')*ned' the proportionate amount of reserves held by
• his b' L'|-'U ?>dn^S at
sanie time was even greater than in the case of
Was lA1'
U
'nstances the percentage of total to required reserves
the Re^-/V'10
^lan a year ^et°re- The reserve position of
■ erve banks has shown increasing strength in the past five years.
17
Twenty-fourth Annual Report, Federal Reserve Bank of Philadelphia
RESERVE POSITION OF MEMBER BANKS
PHILADELPHIA FEDERAL RESERVE DISTRICT
percentage of excess to required reserves
PERCENT
IOO
so H
23
1932
1933
is
Twenty-fourth Annual Report, Federal Reserve Bank of Philadelphia
The total reserves of the member banks held at the Federal
Reserve Bank of Philadelphia shortly after the close of
1938 aggregated $391,900,000 as compared with $382,900,
* 0 a year before. But the amount of reserves required to be held
deP08^ decreased from $301,600,000 at the opening of the year
o $270,800,000. This decline was due principally to the release of
■-11,000,000 by a reduction, effective April 16, in the percentage of reencs lequired against deposits. In the case of demand deposits the re
' uction was from 26 per cent to 22% per cent for banks in central reserve
ll't8'
PCr CGn^
Per cen^ f°r reserve city banks, and from
o 12 per cent for country banks; reserves required against time de
posits of all member banks were reduced from 6 per cent to 5 per cent.
Member
s a lesult, the volume of excess reserves expanded substantially beUCCb ?IU'-V ™ Januai-y °f 1938 and the same time in 1939. This was
specia ly true in the case of member banks outside Philadelphia. In a
in ?J<,,nhcr hanks
Hes- D»st.
' Dollar figures
• in millions)
|,|,,h'<h4|>hiu banks (23)
1938— Jan.; 2nd week
mid
. ne: lst
1939— Jan.;
1st 1,ulf
half
Reserves with Federal
Reserve Rank
Held
Required Excess
Due
from
domestic
hanks
Per cent of
required reserves
Excess Due from
reserves hanks
$238.3
261.1
243.8
$187.4
165.2
171.3
$50.9
95.9
69.5
$120.7
130.1
110.1
33.3
34.0
40.4
27.7
21.7
23.5
5.6
12.3
16.9
33.2
44.5
52.7
20“
57 “
72“
120“
205 “
224 “
49.5
44.9
47.4
37.1
29.6
31.6
12.4
15.3
15.8
26.8
34.7
35.4
33 “
52 “
50“
72“
117 “
112 “
61.8
57.7
60.3
19.4
39.8
41.4
12.4
17.9
18.9
47.8
53.9
58.0
25“
45 “
45 “
97 “
135“
140 “
$382.9
397.7
391.9
$301.6
256.3
270.8
$81.3
141.4
121.1
$228.5
263.2
286.2
27%
55 “
45 “
103 “
106“
27%
58 “
40 “
64%
79 “
80 “
' •Jinilrj banks (631)
li i linn "h P°Pulat'on of
>; an’
mor« (20)
1938—Jan.; 2nd week
1(J3O I nC! lst half
*939—Jan.; 1st half
ii'<SHi'1;,i?,p,ilatio" of
’i,!.1” ,100,000 (89)
1938—Jan,; 2nd week
1930
,lne: 1st half
IJ39-,Ian.: 1st half
Inai^T'iV'Popo'ation
' n. >
(322)
'938—Jan.; 2nd week
1930
I'ne: lsl half
*939—Jan.; ist half
A"
bunks (65R
*938-Jan ; 2nd week
1939
half
-Jan.; lst half
19
76%
Twenty-fourth Annual Report, Federal Reserve Bank of Philadelphia
great many instances the proportion of total to required reserves ranged
from 125 per cent to 200 per cent and higher. Country banks reported
large expansion during 1938 in their deposits with correspondent banks.
Half of these banks carried balances with their correspondents at the end
of 1938 which were as large as, or larger than, required reserves. These
balances held for country banks aggregated $146,100,000 as compared
with required reserves of $96,500,000. Correspondent balances due to
member banks in Philadelphia at the same time totaled $140,100,000 as
against required reserves of $174,300,000.
I he foregoing table and chart show changes in the reserve position
of member banks in this district. For easy reference the figures arc given
in dollars and in percentages.
1 he large expansion in excess reserves and in correspondent balances
of member banks in this district clearly demonstrates the great amount
ol unds available as a basis for credit extension to industry, commerce
ami agriculture. But the demand for this type of credit actually declined
rom 193/ to 1938, and the use of private deposits continued at a low rate.
As a result of decreased borrowing by business and under the pressure for
«arnings banks have increased their investments considerably since the
sni-int! of 19.28
•
*
•, ln<^or8 which influenced changes in total reserves of member banks
in this district are summarized in the following table:
Ml I. I.. r hank reserves and related it.-.
I hiladelphia ledt-ral Reserve District
(Millions of dollars)
Sources of funds:
ItcsiTvc hank credit extended in district
interdistrict commercial transfers
Mint gold purchases, net
Treasury operations...................
Total......... . ..................11..........
I scs of funds:
Currency demand...........
Member bank reserve deposits.
"Other deposits*’ at Reserve bank
Ollier Federal Reserve accounts..
Total
20
1936
1937
1938
- 3
+ 47
+ II
+101
+ 2
+ 1111
+ ft
-131
— 5
- 39
4- 5
4~ 74
+ 153
-
5
+ 35
+ 51
+ 107
- (I
+ 3
+ 12
- 16
-
1
+ 22
+ 9
+ 5
- 1
+ 153
-
5
+ 35
7 wenty-Jourth Annual Report, Federal Reserve Bank oj Philadelphia
Expenditures by the United States Treasury during 1938, resulting
m lansfers of funds from ofher fjjgti-ictg f0 member banks in the Phila' i P ua district, constituted the most important factor in the expansion
ol member bank reserves in this district. The net addition from this
source amounted to $79,000,000 as against the net withdrawal of $125,
, )00 in 1937. This reversal was due partly (a) to a substantial amount
■ unemployment trust funds returned to this district for distribution to
11 i igible unemployed, and (b) to increased expenditure for relief pur
I'° 'c, as indicated by the volume of work relief checks cleared through
this bank.
ie principal developments that tended to reduce member bank re
serves included a net loss of $39,000,000 to other districts through the
a ei< istiict settlements, reflecting largely security purchases by banks,
as against the sale of securities in 1937. The demand for currency also
by 522,000,000, as a result of expanding trade and payrolls in
c,L ’ C<oni' half the year and to some extent because of hoarding which
pint k ci with renewed disturbances abroad. Among minor changes was
Hcu/'f '^’000,000 in Reserve bank credit and an increase of $5,000,000
,n Other deposits”.
Condition of member banks
(•vid • !lS1C J'1^n<t8 'n hanking and credit conditions, which have been in
cri'He ' ' l!r’ng.recent years, continued in 1938. There was a large iniiiemb'-'i 1 eh°s'ts, a considerable expansion in the excess reserves of
a risp1' 'ln'vS’ continued declines in commercial and security loans, and
With , ln investments under the persistent pressure for bank earnings,
from t|U^c lesources on hand and with shrinking demand for bank credit
, 10 usual sources, banks have been searching for new outlets for the
employment of their idle funds.
5
here was a sharp upward trend in the supply of funds
which the l, IOm
m’ddlc
I933 to the close of 1936, a period in
hillion dolb
member banks in this district increased nearly a
quarter of Tfvis temporary reversal of this trend, lasting into the first
(luction in e • • " HS ''UC
to withdrawals of interbank funds, reSecuritv •,n,?HlnmCnt balances> and payments in connection with Social
recovered b “1K”lploy’ncnt trust fund. Most of this loss, however,
,0 52,861 000 000 o' aSt * ’JCe quarters of 1938> deposits rising sharply
’ -W0,000, the second largest volume on record. This expansion
21
I
I went y-fourth Annual Report, Federal Reserve Bank of Philadelphia
22
Twenty-fourth Annual Report, Federal Reserve Bank of Philadelphia
reflected principally substantial local disbursements by the Treasury and
the country-wide increase in funds resulting from heavy inflow of gold to
this country from abroad on capital account or in payment of merchandi'C balances. Deposits of the United States Treasury were increased by
eiedits lor securities, and heavier balances were held for other banks.
Deposits at member banks in Philadelphia on December 31 aggre
gated $1,376,000,000, an increase of $92,000,000 over the previous year
nit a decrease of $71,000,000 from the record high reached in 1936. At
country banks total deposits of $1,485,000,000 were $20,000,000 larger
’ ion in 1937 and were in about the same volume as in 1936. The fol°"mg data show changes in the various types of deposits:
Deposits
in“,1 ”*e«nber hanks
Pps' District
(Millions of dollars)
l,,,liv;<luaiMwiwr.sbips~
mill corporations:
Demand..............
Pavings.............
I ' e* ,9"‘r Ohio..........
J,?-Government........
* o«tal savings............
I»tefil0Calg°Vernment
'Ml other....
I olal deposits.......
Philadelphia banks
December 31
1936
1937
1938
Country banks
December 31
1936
1937
1938
761
121
75
67
3
54
353
10
716
123
116
24
3
47
279
6
731
119
104
52
2
38
325
5
506
724
82
28
15
105
10
19
489
743
85
11
13
98
8
18
501
745
78
25
10
101
9
16
1,447
1,284
1,376
1,489
1,465
1,485
hiand"!^0 lSCS <'Ur’n® 4P38 were largely in several classifications of deinenibe •
A'1 cxpans'on °f over 16 per cent in interbank deposits at
of onn' ,,,4n?b ’n Philadelphia was the most pronounced, indicating lack
'■rensc n,Uni4y ^or fhe employment of these funds in the interior. Inbnlnnce.-1 r’ •" G rcpoided hy both city and country banks, in demand
the Pel. ° 1ladiv'duals, Partnerships and corporations, and in deposits of
'"I'Poi-ii14 . °veiyment- "lime deposits of individuals, partnerships and
*rig the t
f S° *ncreased at Philadelphia banks, apparently representdeclined ' UIS 01 °* business funds to a time basis, but savings deposits
accounted ?me_dcposits- amounting to $1,105,000,000 at the end of 1938,
43 Per cent' ' lth
°f total deposits- The proportion in 1929 was
in dollar amount "18' tlmB deposits in that year were somewhat smaller
23
J wenty-fourth Annual Report, Federal Reserve Rank of Philadelphia
1' rom a seasonal peak in the autumn of 1937 the loans of
member banks declined through the first three quarters of
193,3 to the lowest point since March 1919. There was
only a small recovery in the last three months, and total loans of
$906,000,000 at thc turn of the year were less than half of the average
amount outstanding in 1929.
Loans and
discounts
Thc decrease of approximately $40,000,000 during 1938 was due
principally to a contraction in commercial loans, reflecting reduced busi
ness activity and declining prices over the first half of the year and thc
ability of business to handle increased volume in the second half of 1938
with little additional borrowing. Close buying and rigid control of costs
minimized the demand for credit. Continued repayments on old obliga
tions in the late summer and autumn apparently offset new borrowing, so
that there was virtually no sign of the usual seasonal expansion in comIn, M,nn-y lntllYdual banks have endeavored to maintain the volume of
I IS iy ie extension of personal loans, automobile financing, the pur-
24
I ii enty-fourth Annual Report, Federal Reserve Bank of Philadelphia
'hase of insured mortgages, and other types of loans which are some
" i.it different from those handled formerly. Others have extended credit
under more liberal terms than heretofore and have made advances on ac
counts receivable where collateral of other types could not be obtained.
tIm loans also have become more common, with provision for amortizalon over the life of the loan and maturities of three years or even longer
periods in exceptional cases.
,' I 'le ^eC^ne 'n l°ans during 1938 was greatest at Philadelphia banks,
' ut i reported a substantial decrease in commercial accommodation. At
n G /Wl|I1?^r^ banks the contraction in loans was much smaller, as a
u 'ci increase in advances on real estate largely offset declines in other
classifications.
In- « lnntnciRial loans at the end of 1938 made up nearly half of the total
loan8 °t *7ein^er banks in Philadelphia and less than a quarter of the
Phil I i \'C Country banks. The proportions of real estate loans held by
and'l l' 11 "a aiRl out®ide banks, on the other hand, were respectively 11
u„ ,
Cent' ^be analysis of loans given in the following table is
■ ( ue y on the use to be made of the proceeds:
Millions of dollars
111 In. Fed. ncs. District
December 31, 1933
“tf-K'te’’
11 fnrrn land...........
On other ?tiul P^Perties ■ i
jrSsar*...
'uhw loans........ ;......................
lotal loans..
Percentage
Philadel
phia banks
Country
banks
174
17
17
00
131
16
4
44
■19%
5“
5“
6“
17
23
2
83
18
125
45
1
166
5“
6“
1 “
23 “
355
550
100%
Philadel
phia banks
Country
banks
24%
3“
1 “
B“
3“
23 “
B“
30 “
100%
,<S ZnvesbPents of member banks in this district increased
record volui ' ^’J^OOO during 1938 to $1,421,500,000, approaching the
*79,400,GOo''0* 7 tW°-years a*=0- Tllis increase was due to expansion of
holdings by $12
"" •Phila^Phia» as country banks reduced their
•>1 Per cent of tb ,
At the close of the year investments comprised
e credit outstanding, as compared with 59 per cent at the
25
Philadelphia Federal Reserve District
Figures as of end of year
(000,000's omitted in dollar figures)
Obligations guaranteed by U. S.
Government.......................................
Reconstruction Finance Corp........
Federal Farm Mortgage Corp.......
Home Owners' Loan Corp...........
All other............................................
Other securities...............................................
Obligations of—
States and political subdivisions.............
Pubb'c utilities.............................................
Railroads.......................................................
Federal Land and Federal Intermediate
Credit Banks.............................................
All other.........................................................
Stocks of domestic corporations....................
Foreign securities.............................................
Grand Totals.
'Central reserve dty banks excluded.
Investment distribution: 1938
Reserve city
banks
Country
banks
All member
banks
Philadel
phia banks
1937
1938
1937
1938
1937
1938
Philn.
district
United
States*
Phila.
district
United
States
$511
115
128
I
$62
526
$268
201
64
$334
$276
212
63
$291
50.7%
44.8 “
5.9 “
63.9%
41.8 “
18.3 “
.8 “
38.6%
30.5 “
33.4 “
8.1 “
12.9 “
11.1%
1.0 “
2 5“
9.2%
.3 “
101
0
39
0
$78
$79
$119
4
33
109
3
' 21
$660
$615
135
155
170
148
146
167
18
99
54
29
$151
295
232
62
I
$73
$70
9
9
12.0%
.3 “
2.0“
9.6“
.1 “
2.6 “
6.0“
.3“
25.0%
52.2%
43.0%
12.1 “
2.6 “
2.8 “
8.9 “
13.9 “
15.5“
17.3 “
7.5 “
8.0 “
1.1 “
8.9 “
2.1 “
1.1
6.1
1.8
1.2
54
$234
$246
$426
$398
37.3%
68
37
46
81
40
49
67
118
124
68
106
118
12.3“
6.1 “
7.4“
15
102
39
28
7
28
36
12
7
33
23
13
11
71
18
1.0“
5.0“
3.5“
2.0“
1.0 “
17
8
68
16
14
2.3 “
.8 “
$1,355 $1,421
$580
$659
$775
$762
57
20
46
100.0%
9 «
10.5%
.8“
2.9 “
6.3“
.5 “
13
63
1
39
111
19
.0 “
16.5%
<L7 “
.9 “
3.4“
100.0%
L8 “
100.0%
“
“
“
“
100.09
Annua l Report, Federal Reserve Bank of Phila delphia
Direct obligations: (J. S. Government..
Bonds............................................................
Treasury notes..............................................
Treasury bills................................................
Country
banks
7 wen ty-jo urth
Analysis of Member Bank Investments
Twenty-fourth Annual Report, Federal Reserve Bank of Philadelphia
end of 1937, about 47 per cent in the middle of 1933, and an average of
but 32 per cent in 1929.
Nearly 55 per cent of the investments of member banks at the close
ie year was in direct and guaranteed obligations of the United States
foldings °f direct issues reached the record volume of
’-7,600,000, having increased $83,800,000 during 1938. The expansion
pp. <ii’pccially 'arge 'n h°ldingS
longer maturities, particularly at the
n a e phia banks, owing in part to bonds taken in exchange for Treasny notes. On December 31 bonds maturing in ten years or more made
Up 56 per cent of direct governments at Philadelphia banks and 53 per
11' at country banks. Figures in detail for both classes of banks are
shown below.
n
L- S. Government
•ecuritics held by
member banks
December 31, 19311
rensury bills
1 f„sury nolt9)
»H»nds maturing1939-43
1944-48
..................
1949-58..................................
Total. .
Philadelphia hanks
Amount
Per cent
Country banks
Amount
0
$39,439,000
0
11.8%
$60,000
61,976,000
13,156,000
95,047,000
114,167,000
72,394,000
3.9“
28.4 “
34.2 “
21.7 “
23,761,000
53,072,000
104,719,000
49,1118,000
$334,203,000
100.0%
$293,406,000
Per cent
21.1%
8.1
18.1
35.7
17.0
“
“
“
“
100.0%
consist
s.ecur^’es guaranteed by the United States Government
1'edci" l' p' y
*ssues
^le Home Owners’ Loan Corporation and the
port a 1 arm M°rtgage Corporation. Member banks in this district re<d ^’400,000 in guaranteed securities during 1938 to
bv ndriit’
though the amount available in the market was increased
y additional issues during the year.
Ill
I
•
Fcdep0? r« In‘lpn category of investments other than direct issues of
nations of* t (J''crnment which showed an increase during 1938 was oblicxpanded
Political subdivisions. Holdings of these securities
1 ,uea 812,800,000 to $148,200,000.
the
banks in ,|
piincipally corporate obligations, held by member
owing chiX 7
, deCrea8ed $28-000>000 during 1938 to $496,000,000,
«15,000,000 -n , adecline of $10,000,000 in utility obligations and of
arious stocks. The decline in stocks is accounted for
27
I wenty-fourth Annual Report, Federal Reserve Bank of Philadelphia
utiliU and“S
;hi’,district held unusually large quantities of public
-
ft*--;
"I the total investments of §1,421,500,000, approximately 20 nor
1 ■
“l’I«oximatciy _u per
rent will mature in the venrs viao aa
!h'(.
fnr,’POrtfiOn °f Carning assets °f member banks held in
r™
......
«,u™. «.!»While
28
*",zi“L lo“y,
f™" »i-»l'ane°u.
'I "'enty-fourth Annual Report, Federal Reserve Bank of Philadelphia
The following data indicate the trend in loans and investments, to
gether with earnings therefrom:
i>k’i 1 1 . .Member banks
1 adelphia Federal Reserve District
1927-29
(average)
Deposits..
I^oans.
■■'•ruing!, therefrom
investments.
Warnings therefrom
1938
Per cent
change
$2,764,000,000
+ H%
1,718,000,000
95,501,000
917,000,000
41,501,000
-47 “
-56“
924,000,000
46,773,000
1,390,000,000
46,007,000
+50 “
— 2“
16,007,000
20,884,000
+ 30 “
Warnings from other sources
,
Following a sharp decline between 1929 and 1933, net earnings of
piJ1-" banks from current operations have shown little variation. In
net earnings approximated $34,000,000, and in 1936 and 1937
*n Hinted to $35,000,000 and $34,500,000 respectively. According to a
m t made by this bank and furnished to member banks in this district,
earninE8 from current operations in 1938 were $35,300,000.
vc- •
i’1’01 il^ng results during 1938, compared with the two preceding
' 'tni with the high levels in 1929, are summarized on page 30.
*108400 o''1"6
tOtal GarningS fr°m about $110’900>000 in 1937 to
and ' , ’. " 'n l^33 was due principally to reduced income from loans
Inciii ",.s*Inoi'tsi reflecting in part a lower rate of return on securities.
° rom other sources increased further by about 2 per cent.
100 ()oo'- (!nt expenses were reduced from $76,400,000 in 1937 to $73,decline U1.
^le ^wo principal items in this reduction were: first, a
from 2 I” 'ntcrest Payments on time deposits, the average rate dropping
stantiai d*'0'
1937
1-9 Per cen^ ’n 193^’ anl^’ second, a sub0,1 loan/ aC1?a.8e 'n ^ax Payments, resulting from losses and depreciation
offset a ' U1( *nvcs^menl,s' These declines were more than sufficient to
n increase of about 1 per cent in salaries and wages.
sidcrabiv'/' "/u
loans a”d sceur*t‘es previously charged off were conin 1937 'r*/ \ wbde Profits on securities sold were larger in 1938 than
as ' onimit/n ' 'iTI™ fr°m Profits antl recoveries declined to $16,700,000
""Pared with $17,400,000 in 1937 and $30,700,000 in 1936.
WoKTn loaT8 jndr depreciation increased to $42,000,000 from
’ ” m 1937 and about $37,000,000 in 1936. The most important
29
7 wenty-fourth Annual Report, Federal Reserve Bank oj Philadelphia
Earnings and expenses
of member banks
Philadelphia Federal Reserve District
(000’s omitted)
Current earnings
Interest and discount on loans..
Interest and dividends on securities*
Trust department ............
Service charges on deposits
Ml other..........................
Total..........................
Current expenses
Salaries and wages........
Interest on deposits. . .
Interest on borrowed money
Hixes—real estate....
I axes—other................
All other.............. ...
1936
1937
1938
1929
$42,736
47,542
8,120
1,768
8,753
$42,790
47,680
8,943
2,031
9,508
$44,501
46,007
9,168
2.317
9,399
$106,616
45,4711
7,596
j 10,532
SI OK 010
$110,955
$108,392
$170,222
$26,219
21,161
51
2,862
3,464
19.828
$27,207
20,339
50
2,737
6,166
19,910
$27,498
18,171
40
2,738
4,754
19,572
$30,766
52,726
7,031
j 8,543
$76,409
$73,076
$116,901
$35,001
$34,516
$35,316
$53,321
$3,592
5,818
19,818
1,404
$3,139
3,293
9,270
1,696
$1,449
3,097
10,631
1,509
$782
783
8,071
463
$17,398
$16,686
$10,102
$17,233
11.542
2.777
5,435
$10,523
1 1.917
2,981
2,995
$10,625
22,067
2,705
6,631
$6,365
5,670
2,028
2,718
$28,416
$42,028
$16,781
$28,679
18,588
$23,4911
19,597
$9,971
17,982
$16,612
33,070
Total....................
Net earnings from current operations .
Recoveries and profits on sales
Recoveries on loans
Profits on security sales.
All other...
Total..........
Losses mid depreciation
On loans............................
On investments........
On bulking house and equipment
All other .
Total..............
Net addition to profits. .
Cash dividends declared
17,835
Z V
C0te«0ry.Co0n8,8ted of charge-offs on securities, which in< reused to more than 822,000,000, or 20 per cent of current earnings ns
compared with 811,900,000 in 1937 and 811,500,000 in 1930
...... 8lZoXCC
ese CllangCS’the net addition t0 Profits was only
' 11 1J »10 001,000 as compared with 823,500,000 in 1937 and 828,700 000
•■s.ooo.ooo, ,,„X"
846,600,000.
exceeded 833,000,000 as against net profits of
30
Tuenty-fowth Annual Report, Federal Reserve Rank of Philadelphia
Capital
funds
The capital funds of member banks in this district, com
prising stock, surplus, undivided profits, and reserves, de
creased $8,400,000 during 1938 to $4S7,100,000 at the end
0 il year, this decline was due principally to losses on investments
an to the fact that many banks paid dividends in excess of their net
pro ts foi the year. To some extent it also reflected the retirement of
preferred stock.
As a result of the decrease in capital funds in 1938 and growth in
‘posits, the number of dollars of deposits per dollar of capital funds
’“crcased t0 S5-87> compared with $5.55 at the end of 1937 and $5.95 on
ecem rei 31, 1936. Figures for all member banks of the System likewise
s ‘aw a rise in this proportion from $7.60 to $7.99 during 1938.
io"0wing dnta have been computed to show the relation of
lPi a hinds to deposits, loans and investments, and fixed assets:
Member banks
Phila. Fed.
lies. District
December 31, 193(1
United States
All member
banks
Nonmember in
sured banks*
'nvMtmentH other "than U." S.'
17.0%
20.9 “
31,3 “
12.5%
16.9 “
28.8 “
15.8%
18.7 “
39.1 “
“Wifiationsnrect und guaranteed..........
75.6 “
96.2 “
77.6 “
12.8 “
20.9 “
9.4 “
16.0 “
8.0 “
16.7 “
46.1 “
53.5 “
33.2 “
37.1 “
26.1 “
35.0 “
epOSlts. .
^nlagc of-
InXmX""** inVC8tn,ents......
nerves’. /J’,<liProfits and
TnlnU * urccntagc of—
lament0"'1 ,rlveslmcnts......
investments other" "than' U " S '
ft^nmeni obligation- S"
Ulrtct und guaranteed........
,‘lb<Ur"rv,1,|">U“c’ equipment, anil
C«Pital fund3UlC.t! 1 ercentaBe °f’Commercial bunks.
tIneludes
assets indirectly representing such items.
Money rates
riic i
and earlv
•
1™e.rest rates and bond yields was downward in 1938
• • his easy condition in the money market reflected an
31
'I wenty-fourth Annual Report, Federal Reserve Bank of Philadelphia
indeiisingly large supply of funds seeking employment and an absence of
any substantial demand for funds by business or the capital market. The
/, 'n ' '* '
fnnds was due principally to the inflow of gold
> n a onio and the reduction in reserve requirements in April. The most
m ortant 1 actor on the demand side consisted of security issues by
eueral, state and local governments, as flotations of corporate securities
<> > ain new capital were in smaller volume during 1938 than in either
i '<> piue< ing years. Corporate refunding at lower rates continued
m substantial volume and to that extent affected income of financial
institutions in this district as elsewhere.
,. B°jd- 7 ™d8 I°r th,e year as a whole declined. Such disturbances as
occurred in March and September reflected international tension, while
Mu nitions early in the year in corporate bonds of lower ratings were duo
pnmanly to domestic uncertainties with reBpeet to business activity and
earnings.
J U1U
The downward movement in yields on Treasury bonds continued al
most without interruption, reaching in the first quarter of 1939 the lowest
32
Twenty-fourth Annual Report, Federal Reserve Bank of Philadelphia
rate on record. The return on Treasury notes maturing in from 3 to 5
>ears also declined to a new low level, and in the case of several issues
of earlier maturity the yield was negative because such notes served as
rights in tendering subscriptions to government refunding obligations,
lieasury bills continued to be quoted in the market at lower rates than
in 1.137 and bids on new issues over the turn of the year were at par or a
no yield basis as a result of special demand for them in the money
centers.
Bankers acceptances and call money in New York were quoted nomi''i b at unchanged rates throughout 1938, but prime commercial paper
med in the open market to a record low of % per cent.
Money rates un.l yields
L"('r.c,ul r>“l«r, prime..............
H kn ucccptances’ 90 days....
;'■» money renewals, New York
. . easary bills, 91-day (dealers)
Tre « y50te?' 3-5 Dear......... ..
I' usury bonds, over 12 vears
Kss''a>>s“i,,w
|
Aa........
A...
......................
Baa.. .
Jl«— Industrials.
J uhlic utilities. .
Kails..
Annual averages
December 31
1936
1937
1938
1937
1938
.75%
.15 “
.91 “
.17 “
1.11 “
2.65 “
3.07 “
•95%
.43 “
1.00 “
.28 “
1.40 “
2.68 “
3.10 “
•81%
.44 “
1.00 “
.07 “
.83 “
2.56 “
2.91 “
1.00%
.44 “
1.00 “
.12 “
1.23 “
2.68 “
3.12 “
-62%
.44 “
1.00 “
.05 “
.69 “
2.48 “
2.71 “
3.26
3.46
4.01
5.03
3.55
3.93
4.34
3.19
3.56
4.22
5.80
3.50
3.87
5.21
3.18
3.47
4.18
5.77
3.64
4.04
4.78
4.02 “
4.77 “
3.88 “
4.24 “
“
“
“
“
“
“
“
“
“
“
“
“
“
“
“
“
“
“
“
“
“
3.05
3.39
3.99
5.17
3.36
3.61
4.73
“
“
“
“
“
“
“
Contin"S ,°mC1S rates c^arSed by banks in this district for the most part
i'hil-l,|'”i< | ■ '°S<! t0
levels. Reports from several leading banks in
loans i ,')]lla- sh°wed that the average rate of interest on commercial
eordin r °
September was 3.7 per cent, weighted acioans wer°
d°'lar vo^ume of loans. In number 2.8 per cent of the
ene-quart
at 2 per cen^ or less> biifc they accounted for nearly
at 6 per
t thC tOtal amount- Approximately half of the loans were
total anum t
111 •
n
V°ll’me at thi® rate was °nly 15 per cent of thc
Details are given in the table on the next page.
33
I ii i nlij-fourth Annual Report, Federal Reserve Bank of Philadelphia
New commercial uml industrial loans
made by seven Philadelphia banks
September 1-15, 1938
Number
Actual
Hate
1 per cent................................
Between 1 and 2 per cent .
2 per cent................................
Between 2 and 3 per cent..........
3 per cent................................ ..... ..........
Between 3 and 1 per cent................
4 per cent..................................................
Between 4 and 5 per cent...........
5 per cent.............................. '
...........
Between 5 and 6 per cent
6 per cent.............................. " . ..............
Total......................
Dollar volume
Per cent
Actual
Per cent
0
13
15
6
46
23
145
68
195
32
474
0
1.3%
1.5 “
.6 “
4.5 “
2.3 “
14.2 “
6.7 “
19.2 “
3.1 “
46.6 “
0
$1,690,000
263,000
428,000
734,000
453,000
1,383,000
543,000
1.120,000
80,000
1,159,000
0
21.5%
3.3 “
5.5 “
9.3 “
5.8 “
17.6 “
6.9 “
14.3 “
1.0 “
14.8 “
1,017
100.0%
$7,853,000
100.0%
<lurirw°iQ'i8nK'ri "it/ ma<lc ’D th’8 banks rates of discount or rediscount
,,'u, J ,
„ V~ per C6nt rate charged on rediscounts and advances
1937 31 :nd 13* °f thc Federal Rcserve Act> established in
hist,,iv f n
t I contmued in effect and is the lowest rate in the
were made -T o’ *"
Advan“s to member banks under section 10(b)
, , ,‘
“ 2 per cent’ as in the last quarter of 1937. A complete
schedule oi rates al the end of 1938 follows:
1
December 31,
1938
____________
vhhials, pmtnerahlp' and SrwrT"1 ''T* !>bliPati°ns
indi
.................. d'Astri™l advances—§©cth>nni3badCr
...............
t
organisations............
>n portion for which institution is obligated
On remaining portion
oongaica................................
Commitments to make advances'.............................................
O
II
4
“
4-6
“
2JdS“
*
J^-2
“
•Same os to borrower; minimum of 4%.
Federal Reserve Bank
B.„k
34
ehilad,
I wenty-fourth Annual Report, Federal Reserve Bank oj Philadelphia
States securities. While cash reserves fluctuated widely throughout the
>car, they were greatly in excess of statutory requirements. Total re
sources of this bank increased to $870,000,000 at the end of 1938 from
$791,000,000 a year earlier.
Total earnings declined principally as a result of lower rates of re
turn on investments. But this was more than offset by increased profits
realized on the sale of securities, so that the net amount available for
distribution increased somewhat over 1937.
Annual averages of the earning assets and of the factors used in the
calculation of reserve position are given below. Statements of condition
as of the close of the past three years are shown on page 36.
I < <l< ral lleserve Ba„,
Annual averages of daily figures
li ii° e'*‘'a<lclphia
I’olliir figures in millior
!r!!s discounted.
1 "lb bought..
"‘bwtriul advances
State'Xitiesxitier securities
Total bills and
securities ....
lleserve note
. circulation.
'leu,her bank reserve'
....... .
llher deposits.
‘,"'“1 cash reserves
• ‘htvc ratio.
1935
$
0.6
0.5
4.4
172.7
1937
1936
$
0.4
0.4
5.4
193.8
0
$
1.4
0.3
4.0
208.9
0
$
1938
1929
1.6
$ 88.9
13.1
.0
20.4
0.5
3.2
219.1
0
$178 *>
$122 9
244.4
289.4
313.1
308.3
147.0
235.3
21.5
345.0
68.8%
324.6
27.1
464.0
72.4%
381.2
32.6
534.4
73.5%
375.1
48.2
530.5
72.5%
191.8
67.6%
1
Reserve
bank
credit
Outstanding credit of this bank increased from an average
of $214,700,000 in 1937 to $223,900,000 in 1938, a new
high for the past eighteen years. This expansion in 1938 was
due to larger holdings of government securities.
r,-ninine<l>U^l'r)Ut
^ie System’s portfolio of United States securities
Oiillv red C'>n.Stant
volume. Holdings of Treasury bills were substani,ry note •• lWd n°teS ac1uired in their place, while part of the Treaslcngthen tl"' ^llln’ was exchanged for Treasury bonds. The effect was to
falling d„o! a.Vlerage matur‘ty of the investment account. The proportion
witlnn one year declined from nearly 39 to 32 per cent, while
35
Twenty-fourth Annual Report, Federal Reserve Rank of Philadelphia
Statement of Condition
December 31
Federal Reserve Hunk of Philadelphia
(000 B omitted in dollar figures)
1936
1937
1938
$495,308
194
25,458
$174,891
500
26,940
$546,461
1,236
29,221
'I'otuI reserves.
Bills discounted:
fchi!kyta^crninentol,,igalion8
$520,960
$502,331
$576,918
285
28
1,498
655
704
473
.
Total lulls discounted
Hills bought in open market.......
Industrial advances................
1 Initcd States Government securities.
$
Total hills und securities
One from foreign hanks .
" '
Federal Reserve notes of other F. R banks
Uncollected items...........
oanas
Rank premises................. \\............................
All other resources..........
RESOURCES
Gold certificates on hand and due from U S
Treasury.............................
Redemption fund—Federal Reserve notes
Other cash.............. ...
Iolul resources.
DeS:
LIABILITIES
M r'C nO,CS in
Mcmlier hank reserve account ...
F^JrCtw7reral8cconnt:::;
Other deposits................. .....................
,, ,
Total deposits.........
deferred availabihty items.
"
Other liabilities........
Total liabilities
,, •. I (.'}*,|taL ACCOUNTS
Capital paid in ..
Surplus—Section 7..
Surplus—Section 13b....... \
Other capital accounts ..
Total liabilities and capital
uccountM ... .
Ra tio of total reserves to deposit and Federal
Reserve note liabilities combined
Contingent liability on bills purchased "for
foreign correspondents...........
Commitments to make industrial advance-
313
317
4,686
208,989
$
$
$214,305
21
1,736
58,663
4,952
3,122
$222,926
18
1,662
54,588
4,826
5,067
$227,11t
17
2,081
54,506
4,699
4,637
$803,759
$791,418
$869,972
$312,078
$318,036
$320,562
381,210
6,258
9,209
2,219
365,046
1,092
17,002
2,269
374,231
58,155
19,545
6,899
$398,896
58,926
961
$385,409
53,747
1,092
$458,830
57,591
664
$770,861
$758,284
$837,647
12,211
13,362
4,325
3,000
12,258
13,466
4,411
2,999
12,213
13,696
4,116
2,000
$803,759
$791,418
$869,972
73.3%
2,153
293
3,627
216,853
1,177
56
3,120
222,761
71.4%
74.0%
0
$
166
*
7
$
247
173
•Includes bills secured by obligations fully ------------------------------ —_______ 1,525
guaranteed by United States Government.
36
I wenty-fourth Annual Report, Federal Reserve Bank of Philadelphia
one to five year maturities increased from 34 to 38 per cent, and those
due in over five years from 27 to 30 per cent. This bank was allotted an
increased proportion of the System total, so that its holdings rose from
5216,900,000 on January 1 to $222,800,000 on December 31. A distribu
tion according to type as of the year-end follows:
'v‘ .Goyc*;“nient securities held
1 cderal Reserve Bank of Phila.
December 31
Bonds
Notes
Bills
Total
16,848
42,193
63,561
73,037
120,857
115,317
97,685
100,515
39,415
51,479
55,607
49,189
177,120
208,989
216,853
222,761
9-5%
20.2 “
29.3 “
32.8 “
68.2%
55.2 “
45.0 “
45.1 “
22.3%
24.6 “
23.7 “
22.1 “
100.0%
100.0 “
100.0 “
100.0 “
Dolhirs (000’s omitted):
1936........................................................
1938 . " ...................................................
P,',r“ntage distribution:
1936 .......................................................
1938......................................................
" as 8110 aV 61 a®e v°lume °f discounts on the books of this bank in 1938
hi't '•
an am°unt larger than in each of the three previous years,
lnr’"?8 °nly 2 P6r C6nt
^1C averaSc volume in the years 1927-29. The
• Vo^ume of discounts and advances outstanding was $2,887,000
'|iie'Vt|ln JanUary’ while the smallest was $934,000 in September. Subseiin * V ’scoun^8 increased seasonally and at the close of the year
!l(,$1,177,000. There were 143 individual banks which received
tlici U1Inor a*'*on from this bank during 1938, primarily to take care of
iT'il ,.ein')01ary requirements. Advances under section 10(b) of the Fed53‘’i(inn "e
^actuated between a high of $1,010,000 and a low of
’
i the average volume outstanding was larger than in 1937.
"'id of
hidings of bills bought, amounting to $56,000 at the
of fov • J j8, rcPresented participation by this bank in System holdings
1 mreign currency bills.
Advances by this bank under section 13b to supply work
ing capital to established business declined from $3,627,000
type of • •. i-t0 $3,120)000 in the course of the year. Demand for this
(lie end oHl'^ COn^nue<^ Quiet, although it increased somewhat toward
proved f°
^Car' ^°r
ycar as a wllole 19 applications were ap5(140 000°in
am°Unt °f $4’500’750- as aga>nst 9 applications for
n 1937, and 27 applications for $1,017,900 in 1936.
/OaflJ r‘a
37
I wcnty-jowth Annual Report, Federal Reserve Bank of Philadelphia
During the period of four and one-half years, from June 30, 1934 to
December 31, 1938, this bank received 2,497 inquiries from banks and
business concerns with regard to industrial loans. Out of these inquiries
theie icsulted 652 formal applications, of which 191, or about 29 per cent
were approved, while 414, or 64 per cent were rejected, and 46 applica
tions, or 7 per cent, were withdrawn before action was taken. The amount
(if credit sought by the approved applications aggregated $28,815,000, or
(>2.5 per cent of the total indicated by the applications filed.
A large number of inquiring concerns showed no further interest
after receiving information. Many others could not meet requirements
because they were seeking proprietary or refunding capital rather than
working capital as provided in the Act. Apart from ineligibility, the past
earning records, current financial position, and future prospects of many
inquirers were found to be unsatisfactory.
Loans aggregating $19,408,000 were actually disbursed either directly
>. ns bank or in participation with other banks to 127 borrowers, while
Jen oTTT
,
V their aPPlicati°™ after approval. About 72 per
X
100118
t0 ma™facturers, 18 per cent to coal operstruction, tradeandscXic^.
WaS dividcd amonS
sized eonceL AJ°?«r8 UDder SeCti°n 13b were 8ma11 and niediumSTOOOO and -1
35 PCr Cent °f the borrowers had
worth under
loans theZelv
T "CrC bctWeen S100>000 and
000,000. The
f°Ur-fiftbs in
number being under $1M^O
tunties tc‘xtcmd«ranrn|ber °f ’°anS disburscd’ 34 had to have original ma
i ms extended and, owing to underestimated requirements or to on
foreseen developments, additional advances had to be made to 22 bor‘
nearly «G 500^000 or
reCciving Credit Thes« additions totaled
rowers I™?’™ °T 160 >’er cent of the original extensions to these bor■. n 5 cases more than one additional advance was needed.
Despite the unusual care exercised
«.— ............. id
nt the
,
2? .*at, xxr;"1'’
rowc who .vailed tbemeelve,
the
", feln 77B o, n '
bankruptcy law at,,.,- the i„ail. werc ma[lc to ,
fe?ctlon 77B » '>>'■
standing at the end of
in +bc n +
he amount outg at me mu of 1938 in the first case was $462,845, while in the
38
I wenty-fourth Annual Report., Federal Reserve Rank of Philadelphia
Hecoiid instance it was only $153,972. The principal reasons for the diffiu tics among these less satisfactory borrowers were inadequate manage
"" nt, unfavorable competitive positions, heavy burdens of debt, and
disturbed buying and selling prices.
_ Of the 127 borrowers, 60 repaid their loans and are continuing in
nisiness. In these cases the loans were beneficial as they helped to mainain employment and to rehabilitate the credit standing of the concerns.
1 he daily volume of outstanding loans and commitments from the
" . le of 1934 to the end of 1938 averaged $4,185,000. The experience of
us an in servicing such loans so far has been rather satisfactory, al
t '("nVi ’ "S*S aQd l°sses ’n handling this type of credit are neither con'iil 'i'1 ’ * 1101 ?rct^e^ahle' Largely by reason of experienced personnel and
ex'i'U lle/aC''^'CS a'ready ’n existence when the law went into effect,
• pcnses iavc been relatively low and excessive losses have been avoided.
°f work
triol 1,.- .
As borrowings by member banks continued very light
throughout 1938, the principal operations of the discount
department were in connection with the handling of indus-
of ll ' \Cni,"?ber °f O1’dinary checks handled by the transit department
mite tl ”i lncrcased from 86,058,000 in 1937 to 91,762,000 in 1938, deaveri IU °WC1 avera^e ^eve' °f business activity in the latter year. The
't) ‘ge |,cr w°rking day was 307,000, but there were peak days on which
excccdcd 600,000. In addition, thc automobile run service
me m /
^'’’SOOjOOO checks in packages among the local banks which
nut Inembei's Of the Philadelphia Clearing House.
•ned by tY 'Unie °*.cbecks required to be handled by this bank is lcssHic dist ■■ .|'l'0|)< Ii‘tion 01
county clearings systems, covering most of
iiistitutio' ■’ ln dlc.°Pera^on
which banks mail checks directly to the
kooks of tT °p
tlicy are drawn, settlement being effected on the
die arranJ0
^eserve Bank, This method of clearance, as well as
uiices of .,(J l,lan. S enfc.red into for the settlement of clearing house bal
ing of cliecL-l< i"^ <d*cs °f this district by wire and for the direct send'luiekly available "Vn
°thcr districts’ makes funds more
'«'d iS7genc£,mkPti?rS’^nd exchan6es of securities of the United States
s by the fiscal agency department of this bank declined
39
Twenty-fourth Annual Report, Federal Reserve Bank of Philadelphia
(somewhat ill 1938, but the number of work relief ehecks handled in(leased fioin 5,660,000 to 6,971,000 and other government cheeks in(ieased fiom -,700,000 to 3,055,000. There also was a slight increase in
I ie number of government coupons received for collection, while the
vo ume ol commercial collections showed a small decline, as did transfers
of funds.
A decrease fiom 1937 to 1938 in the number of pieces of currency
received and counted was due in part to the cooperation of member banks
in In owing t ie suggestion made to them last spring that they sort out
and retain hl currency for further use, rather than ship all receipts to this
bank and immediately draw upon it to replenish their tills.
1 Ins bank held an average volume of 8641,000,000 of securities in
\ tin it. member banks during 1938. Additional service rendered
to $405 000 000
1
>f) purc'lase8 and sa^es °f securities amounting
Volume of work
federal Reserve Bank
of Philadelphia
Discounts uud advances
Currency counted.............. .
Coins counted................
(Irdinary checks..................
cius ks handled in packages i,v auUw
mobile run service..............'
JJ. S. Government checks
’’ ork relief checks................
Collection items:
Coupons of U. 8. Government and
agencies....................
All other...................... * ..................
I runsfers of funds..........
Issues redemptions and exchanges by
Pieces or trans
actions bundled
(000’s omitted)
1937
1938
2
203,132
301,684
86,058
2
171,726
280,1(76
91,762
16,253
2,700
5,660
15,819
3,055
6,971
465
189
554
213
1,193
366
66
1,233
350
61
48
248
3,137
49
189
2,813
201
27
182
18
394
45
469
47
fiscal agency department:
Ail tl”'<'ra",cnt diroclobligations
Earnmgt
expert
f
Dollur amounts
(000,000’s
omitted)
1937
$
59
869
28
23,714
1938
$
43
698
26
21,666
A declining rate of return on holdings of United Sta
Principal’y responsible ‘for
W37 S ^15°iTS °fCtiS brk fr°m ®3’559’000
slightly from $2,412,000 to $2,398,000.
40
' ’cnt eXpcnscs decl,ned 1
Twenty-fourth Annual Report, Federal Reserve Bank of Philadelphia
While net earnings from current operations decreased from $1,147,000
in 1937 to $753,000 in 1938, additions thereto, chiefly from profits on
sales of securities, increased from $201,000 to $721,000. Deductions
amounted to $421,000 as compared with $339,000 in 1937, the principal
item being prior service contributions to thc retirement system for 1938
and 1939, which completed the payments on this account. As a result of
Profit und loss account
Federal Reserve Bank of Philadelphia
(000’s omitted)
1937
1938
$
$
Earnings from:
Bills discounted..........................
Bills bought.........................\ \
Industrial advances.......... ................. .. ........'
I Inited States Government securities
<)ther sources ............
26
2
223
3,257
51
26
168
2,936
21
Total earnings........................................
$3,559
$3,151
Expenses:
Operating expenses*.........................
Cost of Federal Heserve currency....
Assessment for expenses of Board of Governors.
$2,099
141
172
$2,078
152
168
I otal net expenses......................
$2,412
$2,398
Current net eurnings...................
$1,147
$ 753
Additions t„ curront nct earnings!
other ’addiuins01 U; S’ Government securities.
$ 201
$ 697
24
$ 201
$ 721
$ 140
193
6
0
$ 387’*
34
$ 339
$ 421
-$ 138
+$ 300
$1,009
$1,053
Deduction,, from current net earnings:
A Governors1*’ "P1>ly °" C°St °f buildi»8 for B«ard <>f
Nre.U n^X^.°r d<!duCti°U8
—
Net earnings available for distribution.......................
Distribut
P a i I*'!,"" ”f not ««nings«
V .lkl rcasu,ry ot United Stales, Sec. 131.
I ra if"‘o i’'.1'11 to ,ile,nb<'r banks.
"'
(Sec. 13b).
Tran«to’8Ur
“P}ua
^^/.3b).
7).
$
84
735
86
104
$
84
734
5
230
received for certain fiscal agency und other ex41
I wenty-fourth Annual Report, Federal Reserve Bank of Philadelphia
these changes, the net amount available for distribution increased to
$1,053,000 as compared with §1,009,000 in 1937.
Dividend disbursements to member banks amounted to §734,000.
1 he sum of $84,000 was paid to the Treasury under section 13b, which
requires that up to 2 per cent, if earned, shall be paid to the government
on funds turned over to this bank by the Treasury for the purpose of
making industrial loans. Of the remaining earnings, §5,000 was added to
the surplus designated as “Section 13b” and §230,000 to the regul ar sur
plus account of this bank,
1 he number of member banks in this district at the end of
1938 was 655, the same as at the beginning of thc year.
State bank members increased from 65 to 66, but the number of national
banks decreased from 590 to 589, owing to the liquidation of one bank
it was succeeded b\ a nonmember. At the close of the year member
banks accounted for 69 per cent of the number and 71 per cent of the
assets of all banks in this district.
Membership
lotal assets of the 914 banking institutions in operation on Dcccm,7 ' urn81,8"!**1! S4’784’000’000- showing an increase of §105,000,000
over 1937, of which all but $10,000,000 was at member banks.
rati0S °f “ember
to
llanlta in Philadelphia
t'cdi-rnl Iteservc District
(Dollar figures in millions)
Niimliir of hunkH
Total....
Member banks........
Proportion member of total
Total JIMMCtH
Total..........
Member lianks
Proportion member of total...
Pennsyl
vania*
New
Jersey*
Delaware
District
Totals
- ------ •--- —t;
772
550
71%
115
85
74%
57#
20
35%
944
655
69%
2,944
71%
$392
276
70%
$254
153
60%
$4,784
3,373
71%
•Portion of thc state in Philadelphia Federal Reserve ni«ir(,.i
* Includes 9 branches of nonmeinber banks.
42
Twenty-fourth Annual Report, Federal Reserve Bank of Philadelphia
J he number of national banks in this district having fiduciary
powers was unchanged at 255.
Changes in
officers and
In the elections held last November Joseph Wayne, Jr. was
reelected by the banks of Group 1 to serve as their Class A
representative on this bank’s Board of Directors, and
Ilarry L. Cannon, a Class C director up to the close of
1C7, was elected by the banks of Group 2 to serve as a Class B director.
■ i. Cannon replaced Mr. Sewall, a director of this bank since 1927,
' lose tenn expired and who had become ineligible for reelection because
0 retirement from active business.
Kichanl L. Austin, Chairman of the Board of Directors and Federal
11 lv Agent since the establishment of this bank in 1914, retired at the
imi 1,1 ' *wben 'ds term as a Class C director expired. By appointB M
^°ard Governors of the Federal Reserve System, Thomas
Bin / l*'t ’ deputy Chairman, succeeded Mr. Austin as Chairman of the
in A '1' lllnc's C- Biddle, who had been appointed a Class C director
" ' I,ri1 1938, became Deputy Chairman. Early in 1939 Mr. Biddle was
4 Jiuige of |jle u g Circuit Court of Appeals for the Third
* ,U11' lcs’gned as a director of this bank in April 1939. In March
and (• 1 A'flcd 11- Williams, Dean of the Wharton School of Finance
Cl
^le University of Pennsylvania, was appointed a
K« - director for a term expiring December 31, 1941.
tional
A' Boeb, Chairman of the Board of the Tradesmens Natliis ba k" in ‘ ^FUS^ Company of Philadelphia, continued to represent
for the - "n
' C^cra^ Advisory Council during 1938 and was reelected
• l‘ii 1939. Mr. Loeb was reelected Vice President of the Council.
',ol\n S' Sinclair served throughout the year as the reprei'r ' edcrid Reserve Banks of Philadelphia and Cleveland
( li vcland n Gpcn Market Committee. M. J. Fleming, President of the
Hand Bank, served as alternate.
'•'•ntative
”o the Fed
'■!> M. I oorman was made Auditor of this bank in March 1939.
officers nsL^10'^
1938 thlS bank bad 772 emP'oyees, exclusive of
’ ngllln8t 780 at, the end of 1937.
43
Directors
as of May 1, 1939
Group
CIiihh A:
Joseph Wayne, Jr.......................
President, Philadelphia National Bank ,
I hiludelphia, Pennsylvania.
Term expire
Dec. 31
1
1911
2
1939
3
1940
1
1940
Harry L. Cannon............................
II. P. Cannon & Son, Inc.,
Bridgeville, Delaware.
2
1941
J. Carl De La Cour..........................
Vice President, Wm. S. Scull Company,
Camden, New Jersey.
3
1939
.
George W. Reily...........................
President, Harrisburg National Bank.
Harrisburg, Pennsylvania.
J. B. Henning..........................
President. Wyoming National Bunk,
I unkhannock, Pennsylvania.
Class II:
C. Frederick C. Stout....................
John 11. Evans and Company,
Camden, New Jersey.
I lioinas II. MeCalie, Chairman and Federal
Reserve Agent.
President, Scott Paper Company,
Chester, Pennsylvania.
"
Alfred 11. Williams............
Dean, W harton School, University of
Pennsylvania, Philadelphia.
Vacancy............................
1939
1941
1910
Officers
John S. Sinclair, President
Frank J. Drinnen,
L. E. Donaldson,
First Vice President
Assistant Vice President
C. A. McIlhenny,
Vice President and Cashier
W. J. Davis,
Vice President
Ernest C. Hill,
Vice President
William G. McCreedy,
Assistant Vice President
Philip
C. A. Sienkiewicz
Assistant Vice President
James M. Toy,
Assistant Cashier
Glenn K. Morris,
Assistant Cashier
Arthur E. Post,
Secretary
M, Poorman, Auditor
@FedFRASER