View PDF

The full text on this page is automatically extracted from the file linked above and may contain errors and inconsistencies.

1
THIRTEENTH ANNUAL REPORT
of the

FEDERAL RESERVE AGENT
of the

NINTH FEDERAL
RESERVE DISTRICT
to the

FEDERAL RESERVE BOARD

Covering the Calendar Year
1927




Federal Reserve Bank of Minneapolis,
Office of the Federal Reserve Agent,
Minneapolis, Minn., February 17, 1928.
To Governor R. A. Young,
Federal Reserve Board,
Washington, D. C.
Sir:
In conformity with our custom, I have the honor to submit herewith the Thirteenth Annual Report of the Federal
Reserve Agent of the Federal Reserve Bank of Minneapolis,
relating to operations during the twelve months which ended
December 31,1927.




Respectfully submitted,
J. R. MITCHELL,
Federal Reserve Agent.

REPORT
OF THE

FEDERAL RESERVE AGENT
AT MINNEAPOLIS

1927
AGRICULTURAL AND BUSINESS CONDITIONS

The year 1927 was not a record year except in purchases
of securities by the general buying public other than banks
and insurance companies. The first part of the year, when
business was dull as a result of the poor crops in 1926, was in
decided contrast with the latter part of the year, when good
crop yields established a higher level of business. For the full
year, debits to individual accounts at representative cities were
four per cent larger than in 1926.
All of the important crops in 1927 were larger than the
crops of 1926 and every crop, except oats, was larger than the
ten-year average. The improvement in business conditions was
largely due to the great increase in the production of bread
wheat, durum wheat and rye, although bountiful yields of hay
and barley and fairly satisfactory crops of corn and oats made
possible an extensive livestock program. Comparison for all
the cash crops and feed crops with last year and with the tenyear average for the years 1918-1927, inclusive, follows:
Relative Size of 1927 Crops in Minnesota, North Dakota, South Dakota,
and Montana
Percent of the
Percent of Average Crop
Cash Crops:
1926 crop
1918-1927
Bread Wheat
171.6
131.7
Durum Wheat
173.1
134.2
Rye
208.3
110.1
Flax
138.6
158.7
Potatoes
132.2
104.3
Feed Crops:
Corn
115.9
109.4
Oats
129.1
91.4
Barley
194.2
154.7
Hay
181.7
124.9

Holdings of swine and sheep increased during 1927, while
beef cattle decreased and the number of dairy cows and heifers
remained unchanged.
Prices of farm products followed divergent trends during
the year. Among the cash grains, bread wheat, durum wheat
and flax exhibited some strength during the summer but closed
the year with prices lower than prices at the beginning of the
year. The decrease was especially noteworthy in durum wheat,
the October median price of which reached a lower level than
in any month since June 1924. The price of rye rose until mid


3

summer, dropped sharply during the months of heavy marketing and finally rose to a higher level than the price in December 1926. The prices of feed grains rose during the year,
although prices at the close of the year were not as high as
before the new crops began to reach the markets. Potato
prices for the 1927 crop are materially lower than for the 1926
or 1925 crops, but higher than for the 1923 or 1924 crops.
In the livestock group, cattle prices rose very sharply
both for feeder and killer classes. Hog prices declined seriously
and sheep and lamb prices remained practically unchanged.
Poultry and egg prices were lower in 1927 than in 1926, but
butter prices were higher.
The cash income of farmers, as a result of these changes
in production and price, was nine per cent larger in 1927 than
in 1926, but did not reach the volume of farm income during
1925. Our estimate of the cash income from the sale of leading products during 1927 is $764,004,000, using terminal
market prices. The products included in this estimate are
wheat, rye, flax, potatoes, dairy products and hogs. No precise
estimates have been made for the income from cattle, sheep
and poultry products but there was no great change in income
from these sources between 1926 and 1927.
Although the large income from cash crops did not affect
business until the last four or five months of the year, the total
volume of business in the district during 1927 was carried
above the volume of 1926 by the increases of these latter
months. Moderate increases were shown in sales of lumber by
country yards, in wholesale sales of agricultural implements
and groceries, in building permits in the smaller cities and in
debits to individual accounts in the smaller cities. Conditions
in the larger cities have a tendency to lag several months
behind the changes in farm income. Department store sales
and building permits in these larger centers were smaller in
1927 than in 1926. On the other hand, some lines of business
showed immediate improvement. Debits to individual accounts
in these cities and security sales were larger in 1927 than in
1926.
FINANCIAL CONDITIONS

The year 1927 opened with country banks experiencing
losses of deposits in all the agricultural regions of the district,
owing to the poor returns from the 1926 agricultural program.
These losses were most pronounced in Minnesota, North Dakota and South Dakota, and no improvement in this condition
was experienced until September, although the actual decline
in deposits at country banks ceased in June. In the last four
months of the year, deposits at country banks increased rapidly and at the close of the year were two per cent larger than
at the close of 1926. These increases were most pronounced
in Montana, North Dakota and South Dakota. Minnesota and
the portions of Wisconsin and Michigan contained in this district experienced only a very small increase in deposits during
the fall months.



Borrowings by country member banks from this Federal
Reserve Bank during- the final weeks of 1927 reached the lowest level in a number of years.
In the large cities, the banks were somewhat affected by
the changes in country banking conditions. Although time
deposits continued to increase, following the trend which has
been almost uninterrupted since the war, demand deposits at
city member banks were smaller in 1927 than in 1926 until
mid-year. As soon as the country banks began to experience
the rapid increase in deposits noted above, their balances with
city correspondent banks were increased and total demand deposits in city member banks in this district, as a result of this
fact, rose far above the 1926 autumn level but did not reach the
high level of the latter months of 1919 and 1924. The assets
of city member banks reflected these changes in deposits.
Commercial loans and balances with correspondent banks were
about the same at the close of the year as at the beginning,
but holdings of investments and loans secured by stocks and
bonds exhibited pronounced! increases. These banks did not
borrow heavily from the Federal Reserve Bank at any time
during the year.
OPERATIONS OF MINNEAPOLIS FEDERAL RESERVE
BANK IN 1927
A. General Survey

The operation of the bank during 1927, as reflected in
the items of the weekly published balance sheet covering
rediscounts for member banks, exhibited marked seasonal
fluctuations. The first few weeks of the year were unimportant except for continued liquidation of the usual borrowings
during the preceding autumn. This movement ceased in the
week ending March 16. The week beginning March 23 saw
the beginning of the usual spring borrowing, and the movement continued until it reached a high point of over eight
million dollars in the week ending May 18. This high point
was the peak for the year, except the week ending July 6
in which Twin City member banks borrowed heavily for a few
days. This spring increase in borrowing was almost entirely
repaid by the week ending June 29. Borrowing caused by the
harvest season began the week of July 13 and reached a peak
in the week ending August 81.
From this time borrowings declined sharply and the week
ending October 19 marked the entire liquidation of the expansion. On this date it is important to note that rediscounts
dropped to two million dollars, the lowest level in several
years. Due to the very early marketing of the crop in 1927,
rediscounts remained at a low level until the week ending
November 30, when the usual December expansion began.
Our total earning assets were affected periodically by
the extensive government financing which was carried on during the year. During the first ten weeks, the total earning
assets declined steadily, due principally to a reduction of bills



bought in the open market. There was an increase in April
and May, owing to increased buying of bills in the open market
and in June, due to enlarged government bond and note holdings. In July and August, the level of bills bought in the open
market was low, but due to increased discounts by member
banks and an increase in bond holdings the total earning assets
continued at a high level. On September 1, the total earning assets began to rise, owing to increased buying of bills in the
open market, and enlarged bond holdings, reaching the high
point of the year in the middle of November of over fiftythree million dollars. During the latter part of November
and the month of December total earning assets declined slowly, owing to a decrease in bond holdings and in bills bought in
the open market.
The net effect of these changes upon our balance sheet for
the year ending December 31, 1927, as compared with December 31, 1926, was as follows: Bills discounted for member
banks decreased from four millions to two millions; bills
bought in the open market increased from twelve and a half
millions to more than eighteen millions; and holdings of United
States securities increased from seventeen millions to twentyfour millions. Total bills and securities at the end of the year
were forty-five million dollars, as compared with thirty-four
millions at the close of 1926. Member bank reserve deposits
increased from fifty-one millions to fifty-five millions. Federal reserve notes in circulation decreased from sixty-nine
millions to sixty-one millions, and cash reserves decreased
from ninety-three millions to seventy-seven millions.
This bank did not borrow from or lend to any other Federal reserve bank during 1927.
The discount rate of the bank remained at four per cent
until September 13, 1927, when it was lowered to three and
one-half per cent.
B. Earnings and Expenses

The gross earnings of this bank during 1927 were $1,390,000, as compared with $1,622,000 in 1926. Current expenses
during 1927 were $1,049,000, as compared with $1,064,000 in
1926. The current net earnings during 1927 were $341,000,
as compared with $558,000 in 1926. Miscellaneous additions
to current net earnings in 1927 amounted to $49,000, and
deductions from current net earnings amounted to $94,000,
leaving final net earnings available for dividends, surplus and
franchise tax of $296,000, as compared with $448,000 in 1926.
In 1927, dividends totaling $180,726 were declared at the rate
of 6 per cent per annum on our paid-in capital stock, and paid
to member banks. There was transferred to surplus account
$11,535. The remainder amounting to $103,816, was paid to
the United States Government as a franchise tax. On December 31, 1927, the book value of the head office building at
Minneapolis was reduced $500,000 by reducing surplus a like
amount.



C. Departmental Statistics of Volume Including the Helena
Branch
The Transit, or Check Collection Department handled
24,238,000 items during 1927, amounting1 to $4,277,152,000, as
compared with 25,286,000 items during 1926, amounting to
$4,336,450,000.
The Collection Department received 263,000 items during 1927, amounting to $127,400,000, as compared with 320,000 items during 1926, amounting to $151,328,000.
The Currency Department received and counted 39,970,000 bills, amounting to $213,292,000 in 1927, as compared
with 37,254,000 bills, amounting to $207,329,000 in 1926. This
department also received and counted 11,794,000 coins,
amounting to $3,852,000 in 1927, as compared with 11,633,000
coins, amounting to $4,059,000 in 1926.
The Vault Custody Department, in its service of safekeeping of securities, handled 113,782 bonds during 1927, as
compared with 48,649 bonds in 1926. This department cut
and forwarded to the owners of the securities, or turned over
to other departments for collection or credit 154,771 coupons
during 1927, as compared with 73,703 coupons during 1926.
The volume of securities in the Vault Custody Department increased rapidly in 1927. On December 31, this department
was holding for member banks $117,000,000 of securities for
safekeeping, pledged against government deposits, or as collateral to bills payable. This sum is 33 per cent of the $350,000,000 of securities owned by member banks on that date.
Wire transfers of funds made for member banks, including those made for the 5 per cent Gold Redemption Fund,
numbered 62,000, totaling $2,734,981,000 during 1927, as compared with 64,000, totaling $2,593,972,000 during 1926.
The Discount Department received 2,201 applications for
loans during 1927 and served 275 member banks. In 1926, 2,735
applications were received and 270 banks served. During
1927,10,027 notes were discounted, amounting to $141,031,000,
as compared with 12,515 notes, amounting to $221,889,000 in
1926.
Of the total bills discounted for all member banks, the
percentages in amount divided by state lines during the last
five years were as follows:
Minnesota
South Dakota
North Dakota
Montana
Wisconsin
Michigan

1927
88.3%
3.3
4.3
1.3
1.5
1.3

1926
91.9%
2.9
2.2
1.0
1.1
.9

1925
80.0%
9.0
3.7
1.9
2.4
3.0

1924
63.9%
13.4
12.0
7.4
2.1
1.2

1923
80.0%
6.9
4.9
6.2
1.2
.8

Bills drawn in dollars and foreign currencies which were
purchased by this bank in the open market during 1927 numbered 6,514, amounting to $75,219,000, as compared with
4,986, amounting to $63,057,000 in 1926. Bills purchased from
other Federal Reserve Banks during 1927 numbered 1,121,



7

amounting- to $22,921,000, as compared with 1,100, amounting to $20,600,000 in 1926.
FISCAL AGENCY FUNCTIONS

The Fiscal Agency operated by us for the United States
Government redeemed 1,009,976 Government coupons amounting to $9,919,000 during-1927 as compared with 1,025,496 coupons amounting to $11,016,000 in 1926.
Other operations consisting- of issues, redemptions or exchanges of various Government securities, including, Treasury
Savings Securities, redeemed at this office, or received from
Postmasters after redemption by them, numbered 181,529
pieces and amounted to $170,657,000 as compared with 85,568 pieces amounting to $80,771,000, in 1926. Included in the
figures for 1927 are the Second Liberty Loan Bonds which
were called for redemption on November 15. Of these, 24,539 pieces totaling $36,199,650 submitted in 3,785 applications, were exchanged for other isues offered by the Government prior to November 15. The greater part of the Seconds,
numbering 59,699 in coupon form, amounting to $14,679,250
and 17,939 in registered form amounting to $4,966,350, were
submitted in 11,851 applications for redemption.
In June, the Treasury Department made public announcement of its willingness to purchase Second Liberty Loan bonds
direct from individual holders. Thirteen proposals from holders in this district offering $19,550 of this issuie at not exceeding 100-16/32 were finally accepted and paid for. Again
in October and November, additional purchases amounting to
$1,176,500 submitted in 409 applications, were made at prices
not exceeding 100-3/32.
This Agency also handled during 1927, 5,267 orders for
the purchase of Government securities and 6,971 resales of
Government securities totaling $92,746,110. In addition, either
delivery or payment, or both, was handled for banks and trust
companies on 833 transactions in Government securities
amounting to $58,555,050. There were also 697 transactions
of miscellaneous general market securities aggregating $3,928,000, Altogether, of these various transactions, there were 13,768 totaling $155,229,160 as compared with 10,905 transactions
totaling $129,682,2010 in 1926, or an increase of 26% over
1926 in the number of transactions handled.
Including short term Government securities which were
transferred by wire, delivery of 38,308 pieces totaling $80,432,050 was made on purchase and resale transactions for
other than our own account as compared with 32,277 pieces
totaling $67,027,350 in 1926. In addition, on exchange transactions such as denominational exchange, the exchange of
coupon for registered securities, etc., 30,999 pieces were delivered amounting to $23,961,550.
This Agency assisted in the allotment of eight offerings of
United States Government issues during 1927 as compared
with three offerings during the preceding year. In such opera


8

tions during 1927, 15,572 individual subscriptions contained in
4,166 different applications were received. The amount allotted
on these subscriptions was $61,578,100. During: 1926, 7,966
individual subscriptions contained in 492 applications were received and $26,831,700 was allotted.
ACTIVITIES OF THE FEDERAL RESERVE AGENTS
OFFICE
A. Federal Reserve Note Issues

Since the organization of this Federal Reserve Bank there
have been received by the Federal Reserve Agent from the
Comptroller of the Currency $405,220,000 of new Federal reserve notes, and during this same period there has been issued by the Federal Reserve Agent to the Bank $395,046,000
of new Federal reserve notes. Meanwhile, the Federal Reserve
Bank "retired," or returned to the Federal Reserve Agent
$117,583,000 of currency fit for reissue, and such reissues of
fit-for-use notes totaled $110,233,000. Federal reserve notes
were redeemed and destroyed at Washington since the organization of this Bank totaling $320,785,445. The total of such
notes issued by the Federal Reserve Agent to the Bank, as
shown above, less the amount returned to the Agent and the
amount returned1 to Washington for destruction, are designated as "outstanding."
From the foregoing it is apparent that on December 31,
1927 the amount of notes outstanding was $66,910,555, and
the Federal Reserve Agent held $17,524,000 of new and fitfor-use notes.
Of this total outstanding ($66,910,555) there was "in
circulation" $61,224,165, and the amount of notes held by our
paying tellers here and in the Branch Office at Helena combined and the amount of mutilated Federal reserve notes forwarded for redemption totaled $5,686,390.
During 1927 the Federal Reserve Agent and his assistants received $19,080,000 of new Federal reserve notes from
the Comptroller of the Currency at Washington and $20,876,500 offit-for-uisenotes from our paying tellers. The issues
of new and fit-for-use notes totaled $36,694,500, as compared
with $46,702,000 during the preceding year. The amount of
Federal reserve notes outstanding with this Federal Reserve
Bank decreased from $75,062,890 to $66,910,555 between December 31, 1926 and December 31, 1927.
Federal reserve notes in actual circulation declined from
$68,891,000 at the beginning of the year to $56,839,865 on
August 31, which was the lowest point shown in the published
weekly statements, and increased thereafter to a high point of
$63,804,435 on November 2. The amount in actual circulation on December 31,1927, was $61,224,165.
Unissued Federal reserve notes on hand held by the Federal Reserve Agent and his assistants amounted to $17,524,000
on December 31, 1927, as compared with $14,262,000 on December 31, 1926.



As collateral security for the Federal reserve notes outstanding with the Federal Reserve Bank, there was held by the
agent on December 31, 1927, $49,728,000 in the form of gold
coin and gold certificates, in vault or on deposit with the Federal Reserve Board, and $19,944,000 in eligible paper, compared with $60,539,000 in gold and $16,341,000 in eligible
paper on December 31, 1926.
B. Membership
At the close of the year, there were 735 member banks
operating in this, district, as compared with 764 member
banks at the beginning of the year. There was a net loss of
18 national banks and 11 state banks. The total membership
(banks in operation only) at the close of 1927 was divided into
674 national banks and 61 state banks. The new members
are:
Name of Bank

No. of Shares
Town
Subscribed
Columbia National Bank of
Columbia Heights, Minn. . 18
Becker County National Bank of
Detroit Lakes, Minn
33
Pioneer National Bank of
Duluth, Minn
72
Western National Bank of
Duluth, Minn
72
First National Bank in
Jackson, Minn
24
Central National Bank of
Minneapolis, Minn
90
Fifth Northwestern National Bank of.. .Minneapolis, Minn
66
Fourth Northwestern National Bank of .Minneapolis, Minn
90
Minnehaha National Bank of
Minneapolis, Minn
72
Third Northwestern National Bank of.. .Minneapolis, Minn
132
Security National Bank of
Montevideo, Minn
36
Citizens National Bank of
Olivia, Minn
21
Midway National Bank of
St. Paul, Minn
90
Security National Bank of
Hope, N. D
18
First National Bank in
Langdon, N. D
36
First National Bank of
Ree Heights, S. D
21

NUMBER OF BANKS IN OPERATION IN THE NINTH
FEDERAL RESERVE DISTRICT
December 31, 1926, and December 31, 1927
National
State Members Non-Members
Total
1926 1927 1926 1927 1926 1927 1926 1927
Michigan
39
79
78
9
31
30
9
39
874 1,251 1,170
944
281
21
15
Minnesota
286
111
27
24
112
72
Montana
75
214
207
North Dakota.. 146
378
563
521
2
2
415
141
9
310
308
9
South Dakota.. 100
419
96
413
204
2
4
Wisconsin
46
197
254
244
45
Ninth Federal
Reserve Dist....692
674
72
61 2,016 1,898 2,780 2,633

C. Examination of Banks
During 1927, 70 examinations and credit investigations
were made by the Federal Reserve Agent's Examiners, of
which 68 were made in conjunction with state banking department examiners and 2 were made independently. In the
examination work this year, three examiners were used
throughout the year, who with their assistants traveled in
the aggregate 28,850 miles and examined banks with total resources of $74,483,094. In addition to the foregoing examina


10

tions and credit investigations, special visits were made to 5
banks for the purpose of obtaining credit information, or in
connection with rediscounts or collections, or to give general
assistance to member banks.
In addition to the information obtained from the Federal
Reserve Examiners, 1,355 reports of examination of national
banks were received from the Chief National Bank Examiner
of this district, and 21 reports of examination of state member banks were received from the various state banking departments. There were four calls for reports of condition of
national banks and four calls for state member banks during
the year. Also two semi-annual statements of earnings and
dividends were required from all member banks. Reports of
condition and of earnings and dividends totaling approximately 4,500 were received, verified and filed.
D. Applications for Fiduciary Powers
National banks have continued to apply for trust powers
under Section 11-K of the Federal Reserve Act. Applications
received and approved by the Federal Reserve Board during
1927 include the following:
Name of Bank
First National Bank
Iron National Bank.
Miners National Bank
First National Bank
First National Bank
„
First National Bank
First National Bank in
Grafton National Bank
Citizens Nat'l Bank in
Union National Bank

Location
Lake Linden, Mich
Ironwood, Mich
Ishpeming, Mich
Calumet, Mich
Laurium, Mich
Fairmont, Minn
Minneapolis, Minn
Grafton, N. D
Sioux Falls, S. D
Eau Claire. Wis

Date
Approved
3-17-27
4- 6-27
5- 5-27
9-27-27
10- 5-27
„ 1-19-27
10-12-27
5- 3-27
5-10-27
7-28-27

Capital

Powers

$100,000
100,000
100,000
200,000
100,000
100,000
5,500,000
100,000
100,000
200,000

Limited
Limited
Limited
Full
Limited
Full
Full
Full
Full
Full

E. Reviews of Agricultural and Business Conditions

During the year, twelve monthly reviews were prepared
for the Federal Reserve Board and later published, containing
a total of 99 pages of printed material. The number printed
in December, 1927, was 6,425, as compared with 5,975 in
December, 1926.
A summary of national business conditions prepared by
the Federal Reserve Board was included in each issue.
A number of special studies were published in the monthly reviews during the year as follows:
Country Bank Balances with Correspondent Banks, 19201927. (January 28).
Smut Infection in Spring Wheat, 1925-1926. (February
28).
Building Conditions in Minneapolis and St. Paul, with
Special reference to residential building supply and demand.
(February 28).
Analysis of Farmers' Intentions to Plant Wheat and
Flax. (March 28).
Banking in 1926. A General Survey of the Year. (March
28).
Crop Acreages and Production, and The Farm Value of
Cash Crops, 1910-1926. (Supplement to March 28 issue).
Estimated Cash Value of Grain Marketed in Minnesota,
North Dakota, South Dakota and Montana, by Months, Janu


ll

ary 1923 to March 1927, an Improved Method of Measuring
Farm Income from Grains in this District. (April 29).
Moisture and Seed Survey. (May 31).
Estimated Cash Value of Potatoes sold by Farmers in
Minnesota, Montana, North Dakota and South Dakota, by
Months, January 1923-April 1927. (May 31).
Motor Vehicle Registrations in Minnesota, North Dakota,
South Dakota and Montana, and for the Entire United States,
1915-1926. (June 27).
Estimated Cash Value of Butter Production for Sale in
Minnesota, North Dakota, South Dakota and Montana, by
Months, January 1923-May 1927. (June 27).
Estimated Cash Value of Milk Sold by Farmers in Minnesota, North Dakota, South Dakota and Montana, by Months,
January 1923-June 1927. (July 28).
Northwest Farm Product Prices. A chart showing changes
in the course of 19 price series during the post war period.
This is mainly a summary of price tabulations made in this
office and charted together for convenient reference. (July 28).
Summary of Country Banking Conditions in the Ninth
Federal Reserve District Based on Call Reports of 117 Selected
Country Member Banks on June 30, 1926 and June 30, 1927.
This series of figures was inaugurated to make possible analysis of conditions in the various economic regions of the district, and also to provide a means of estimating changes in
banking conditions immediately after each call date, thus
eliminating a delay of sixty days in ascertaining the facts.
(August 29).
Estimated Cash Value of Hogs Sold by Farmers in the
Ninth Federal Reserve District, by months, January 1923July 1927. (August 29).
Complete Mid-Year Banking Returns from the Ninth Federal Reserve District as of June 30, 1927. (September 29).
Estimated Cash Value, of Dairy Products Sold by Farmers of the Ninth Federal Reserve District, by months, January
1923-July 1927. (September 29).
The Trend of Rural Business 1924-1927 Compared with
the Trend of Farm Income in the Ninth Federal Reserve District. (October 28).
Country Bank Conditions in the Fall of 1927 and A Survey of Country Bank Conditions of 1920-1927. (October 28).
1927 Crop Income and Bank Deposits: Being a map and
description of the seasonal change in country member bank
deposits by counties from August 1927 to November 1927.
(December 29).
Currency Flow, a New Index of Business. Consisting of
the movement of paper currency into the Federal Reserve
Bank of Minneapolis or out of this bank in accordance with
the needs of commercial banks. (December 29).
F. General Service

There is a demand that this Federal Reserve Bank furnish speakers for various public meetings, and that they describe the operations of the Federal Reserve System and its



12

relation to agriculture, commerce, industry and finance. In
response to this demand during the year 1927, officials and
representatives of this Bank addressed 55 different groups,
with a total attendance of 8,646 persons, as compared with
71 addresses and an attendance of 9,629 in 1926. In addition, many requests were received through personal calls or
letters for specific information regarding1 the banking system, all of which have been met with such information as
could be obtained from our library and office files. During the
year 1927, the number of volumes in our library increased
from 1,158 to 1,266, not including pamphlets, bound periodicals or annual reports. The number of newspapers and periodicals received was practically unchanged and was comprised
chiefly of those having current interest and permanent value
for reference purposes.
CHANGES IN PERSONNEL

In the annual fall elections Mr. John S. Owen of Eau
Claire, Wisconsin, was reflected a Class "B" Director to succeed himself, Mr. Karl J. Farup of Park River, North Dakota,
was elected a Class "A" Director, succeeding Mr. Wesley C.
McDowell of Marion, North Dakota, whose term expired at
the end of the year. The Federal Reserve Board reappointed
Mr. J. R. Mitchell as Chairman of the Board and reappointed
Mr. Homer P. Clark as Class "C" Director for a term of three
years beginning January 1, 1928, and redesignated him
Deputy Chairman. The Federal Reserve Board also reappointed Mr. Curtis L. Mosher, Assistant Federal Reserve Agent
and reappointed Mr. Henry Sieben Director of the Helena
Branch for a term of two years beginning January 1, 1928.
On June 15 Mr. J. F. Ebersole, Assistant Federal Reserve
Agent, resigned to become Chief of the Section of Financial
and Economic Research of the United States Treasury at
Washington, D. C.
Upon September 26, Governor R. A. Young presented his
resignation to become Governor of the Federal Reserve Board
at Washington. Upon the same date Mr. W. B. Geery, Deputy
Governor was elected as Governor of the bank. Mr. Harry
Yaeger, Assistant Deputy Governor, was elected Deputy
Governor, Mr. B. V. Moore becoming the senior Deputy Governor and Secretary of the bank.
On the retirement of Mr. Ebersole, Mr. 0. S. Powell was
appointed Statistician, and with the approval of the Federal
Reserve Board was assigned certain duties as assistant to the
Federal Reserve Agent. At the close of the year the Federal
Reserve Board appointed Mr. F. M. Bailey, Manager of the
Examination Department, as Assistant Federal Reserve
Agent. The Board of Directors at its December meeting elected
Mr. T. A. Marlow as a Director of the Helena Branch.
The complete staff of the Federal Reserve Bank of Minneapolis and its Helena Branch, including officers, employees
and building employees, but excluding temporary help, numbered 340 persons on December 31, 1927, as compared with
346 at the close of the previous year.



13

Resources and Liabilities of the Federal Reserve Bank
of Minneapolis
(In Thousands of Dollars)
RESOURCES
Dec. 31,
1927
$ 49,729
1,423

Dec. 31,
1926
$ 60,539
2,074

Dec. 31,
1925
$ 57,420
2,059

Gold held exclusively against Federal reserve notes..$ 51,152
Gold settlement fund with Federal Reserve Board
16,830
Gold and gold certificates held by bank.
_
5,052

$ 62,613
20,483
6,873

$ 59,479
18,760
6,905

$ 73.034

$ 89,969

$ 85,144

4,029

3,152

2,200

$ 77,063

$ 93,121

$ 87,344

1,223

903

1,145'

329
1,576

658
3,380

551
2,870

Gold -with Federal reserve agent
Gold redemption fund with United States Treasury

Total gold reserves...-

~

Reserves other than gold

,

Total reserves
Non-reserve cash
_
Bills discounted:
Secured by United States Government obligations
Other bills discounted
Total bills discounted

„_

$

Bills bought in open market
United States Government securities:
Bonds
Treasury notes
_
Certificates of indebtedness.

$

4,038

$

3,421

12,615

18,741

11,678
4,411
7,811

7,569
1,841
7,629

7,665
7,094
4,319

$ 23,900

$ 17,039

$ 19,078

620

621

$ 44,744

$ 34,313

55
257
$ 41,552

15,162
2,202
1,791

13,543
2,774
2,159

14,199
2,943
2,670

$ 142,185

$ 146,813

$ 149,853

$ 61,224

$ 68,891

$ 70,161

54,836
1,874
139
274

50,946
1,567
901
152

53,071
1,263
272
362

—$ 57,123

$ 53,566

$ 54,968

13,010
3,009
7,039'
780

12,858
3,064
7,527
907

13,149
3,183
7,501
891

$ 142,185

$ 146,813

$ 149,853

76.0

69.8

Total United States Government securities
Other securities
~
Foreign loans on gold
Total bills and securities

1,905
18,319

_

~

Uncollected items
Bank premises
All other resources

-

Total resources

„

LIABILITIES
Federal reserve notes in actual circulation
Deposits:
Member bank reserve account
Government
Foreign bank
Other deposits
Total deposits
Deferred availability
.Capital paid in
Surplus
All other liabilities

items
_

Total liabilities

Ratio of total reserves to deposit and Federal reserve note liabilities combined (per cent)
Contingent liability on bills purchased for
correspondents




14

foreign
$

65.1
6,863

$

1,806

$

2,321

Earnings and Expenses of Federal Reserve Bank of Minneapolis
EARNINGS
Dec. 31,
1927
$ 192,216
360,293
707,599
13.404
116,519

Dec. 31,
1926
$ 310,424
405,511
723,348
16.473
166,577

Dec. 31,
1925
$ 231,342
440,784
676,696
17,414
72.105

$1,890,031
1,048.746

$1,622,333
1.063,757

$1,438,341
1,097,829

$ 341,285
48,509

$ 558,576
79,773

$ 340,512
39,367

71,982
10,784
10,951

166.272
20,870
3.174

126,411
10,347
8,167

Total deductions
_
$ 93,717
earnings available for dividends, surplus
and franchise tax
296,077
Distribution of net earnings:
Dividends paid
180,726
Transferred to surplus account
11,535
Franchise tax paid U. S. Government
103,816
CURRENT EXPENSES
Salaries:
Bank officers
$ 129,360
Special officers and watchmen
28,624
Clerical staff
357.849
All other
79,065i
Governors' conferences
444
Federal Reserve Agent's conferences
210
Federal Advisory Council
1.112
Directors' meetings
7,446
Traveling expenses*
28,058
Assessment for Federal Reserve Board expenses....
23,137
Legal fees
_
27,494
Insurance (other than on currency and security
shipments
_
29,102
Taxes on banking house
85,643
Repairs and alterations, banking house
9,391
Light, heat and power
_
19,562
Rent
Telephone
5,304
Telegraph
19,972
Postage
61.876
Expressage
,
8,415
Insurance on currency and security shipments
13,391
Printing and stationery
25,322
Office and other supplies
19,901
All other expenses
32,468

$ 190.316

$ 144,925

448,033

234,954

187,609
26,043
234,381

193,560
4,139
37,255

$ 135,681
25,958
357.223
80,091
568
288
824
7,289
35,222
22,596
30,701

$ 125.552
25,568
375.112
93.344
645
300
991
8,256
45,723
23,006
29,884

28,246
82,713
4,540
19,762
5,816
23,277
64.373
8,437
14,091
25,568
19,725
34,810

31,793
80,031
7,931
19,757
7,889
5,769
21,975
61,597
9,553
14,424
22,035
22,891
32,094

$1,013,146

$1,027,799

$1,066,120

34,117
1,483

33,597
2,361

28.255
3,454

$1,048,746

$1,063,757

$1,097,829

Discounted bills
Purchased bills
U. S. Securities
Deficient reserve penalties
Miscellaneous
Total earnings
Current expenses

~

-

-

_..

Current net earnings
Additions to current net earnings
Deductions from current net earnings:
Bank premises—depreciation
Furniture and equipment
All Other
„
„
_
,Net

Total exclusive of cost of currency
Federal reserve currency (including
charges):
Original cost
Cost of redemption
-

shipping

Total current expenses

REIMBURSABLE EXPENSES OF FISCAL AGENCY DEPARTMENT
Salaries
$ 13.038
$ 12.270
$
All other expenses
6,911
5,270

15.290
6,123

Total
$ 19,949
$ 17,540
$ 21,413
•Other than those connected with governors' and agents' conferences and meetings
of the directors and of the Advisory Council.




15

DIRECTORS AND OFFICERS
FEDERAL RESERVE BANK OF MINNEAPOLIS
JANUARY 1, 1928
DIRECTORS
Class A
1928
1929
1930

Minneapolis, Minn.
Aberdeen, S. Dak.
Park River, N. Dak.

1928
1929
1930

-

St. Paul, Minn.
Helena, Mont.
Eau Claire, Wis.

1928
1929
1930

Menominee, Mich.
Minneapolis, Minn.
St. Paul, Minn.

PAUL J. LEEMAN
J. C. BASSETT KARL J. FARUP

Class B
PAUL N. MYERS
N. B. HOLTER JOHN S OWEN .

Class C
GEO. W. McCORMICK
J. R. MITCHELL
HOMER P. CLARK

OFFICERS
J. R. MITCHELL, Chairman and Federal
Reserve Agent.
HOMER P. CLARK, Deputy Chairman.
CURTIS L. MOSHER, Secretary, Board of
Directors and Assistant Federal Reserve
Agent.
FRED M. BAILEY, Assistant Federal Reserve Agent.
OLIVER S. POWELL, Statistician.
ANDREAS UELAND, Legal Counsel.
SIGURD UELAND, Assistant Counsel.

W. B. GEERY - B. V. MOORE
- •
HARRY YAEGER
FRANK C. DUNLOP
GRAY WARREN
L. E. RAST
H. C. CORE HARRY I. ZIEMER •
A. R. LARSON
-

- Governor
Deputy Governor
Deputy Governor
Controller
Cashier
- Asst. Cashier
Asst. Cashier
Asst. Cashier
Asst. Cashier

MEMBER OF FEDERAL ADVISORY COUNCIL
THEODORE WOLD, Vice President, Northwestern National Bank,
Minneapolis, Minn.

HELENA BRANCH—(MONTANA)
DIRECTORS
c. J. KELLY, Chairman
HENRY SIEBEN, Vice Chairman
R. O. KAUFMAN
R. E. TOWLE
T. A. MARLOW -

.
-

R. E. TOWLE
- H. L. Zimmermann

Managing Director
_
Cashier

.

Butte,
Helena,
Helena,
Helena,
Helena,

1928
1929
1928
1928
1929

.

Mont.
Mont.
Mont.
Mont.
Mont.

OFFICERS




W. tA. CUTLER, JR.
T. B

-

Asst. Cashier
Legal Counsel


Federal Reserve Bank of St. Louis, One Federal Reserve Bank Plaza, St. Louis, MO 63102