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FOURTEENTH ANNUAL REPORT
of the

Federal Reserve Bank
of Dallas

FOR THE YEAR ENDED
DECEMBER 31,

1928

ELEVENTH FEDERAL RESERVE DISTRICT




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FOURTEENTH ANNUAL REPORT
of the

Federal Reserve Bank
of Dallas

FOR THE YEAR ENDED
DECEMBER 31,

1928

ELEVENTH FEDERAL RESERVE DISTRICT




LETTER OF TRANSMITTAL
January 22, 1929,
Gentlemen:
I have the honor to submit herewith the Fourteenth
Annual Report of the Federal Reserve Bank of Dallas coveringthe year ended December 31, 1928.
Respectfully,
C. C. WALSH,
Federal Reserve Agent.
Federal Reserve Board,
Washington, D. C.




DIRECTORS AND OFFICERS
of the
FEDERAL RESERVE BANK OF DALLAS
1929
DIRECTORS
CLASS A
CLASS B
T. H. FROST, San Antonio, Texas
A. S. CLEVELAND, Houston, Texas
HOWELL E. SMITH, McKinney, Texas
J. R. MILAM, Waco, Texas
VV. H. PATRICK, Clarendon, Texas
J. J. CULBERTSON, Paris, Texas
CLASS C
C. C. WALSH, Dallas, Texas
CLARENCE E. LINZ, Dallas, Texas
S. B. PERKINS, Dallas, Texas

MEMBER FEDERAL ADVISORY COUNCIL
B. A. McKINNEY, Dallas, Texas

OFFICERS
C. C. WALSH, Chairman and Federal Re- LYNN P. TALLEY, Governor
R R
rrSeAri<W^?^tTr T TXT7 ™
/-t. •
- - GILBERT, Deputy Governor
CLARENCE E. LINZ, Deputy Chairman
«„»„«»».». ~
„
R B
CHAS. C. HALL, Assistant Federal Re- - COLEMAN, Deputy Governor
serve Agent and Secretary
FRED HARRIS, Cashier
W. J. EVANS, Assistant Federal Reserve
W. D. GENTRY, Ass't. Deputy Governor
Agent
J. L. HERMANN, Assistant Cashier
W. P. CLARKE, General Auditor
E. B. AUSTIN, Assistant Cashier
C. C. TRUE, Assistant Auditor
R. O. WEBB, Assistant Cashier
CHAS. C. HUFF, General Counsel
LOCKE, LOCKE, STROUD & RANDOLPH, Counsel

EL PASO BRANCH
DIRECTORS
A. P. COLES, El Paso, Texas, Chairman
E. A. CAHOON, Roswell, N. M.
G. D. FLORY, El Paso, Texas
A. J. CRAWFORD, Carlsbad, N. M.
E. M. HURD, El Paso, Texas
W. O. FORD, El Paso, Texas
C. M. NEWMAN, El Paso, Texas

OFFICERS
W. O. FORD, Managing Director
ALLEN SAYLES, Cashier

HOUSTON BRANCH
DIRECTORS
J. C. WILSON, Beaumont, Texas, Chairman
GUY M. BRYAN, Houston Texas
E. F. GOSSETT, Houston, Texas
FRED W. CATTERALL, Galveston, Texas
E. A. PEDEN, Houston, Texas
R. M. FARRAR, Houston, Texas
DWIGHT P. REORDAN, Houston, Texas

OFFICERS
DWIGHT P. REORDAN, Managing Director
L. G. PONDROM, Cashier
H. R. DeMOSS, Assistant Cashier

SAN ANTONIO BRANCH
DIRECTORS
FRANK G. CROW, McAllen, Texas, Chairman
JOHN M. BENNETT, San Antonio, Texas
REAGAN HOUSTON, San Antonio, Texas
M. CRUMP, San Antonio, Texas
R. T. HUNNICUTT, Del Rio, Texas
FRANZ C. GROOS, San Antonio, Texas
ERNEST STEVES, San Antonio, Texas




OFFICERS
M. CRUMP, Managing Director
C. B. MENDEL, Cashier

FEDERAL RESERVE BANK OF DALLAS
COMPARATIVE STATEMENT OF CONDITION
(In Thousands of Dollars)
RESOURCES

Total bills discounted _
Bills bought in open market.
_
U. S. Government securities:
Bonds
Treasury Notes
Certificates of indebtedness _
Total U. S. Government securities.—
Other securities
_
Total bills and securities
Due from foreign banks
Uncollected items
Bank premises
All other resources _
Total resources

Total deposits
Deferred availability items
Capital paid in._
Surplus
All other liabilities

878
22,811

4,772
15,927

18,107
2,671
11,211

3,738
3,813
15,788

31,989

23,339

55,678

44,038

17
29,964
1,785
501

28,215
1,755
358

160,337

153,686

48,585

47,472

48,803

71,017
1,111
228
92

70,970
774
162
103

62,898
1,257
985
61

Dec. 31,
1926
38,488
2,609

72,448

—

_
—
_

—
-

_

Total liabilities
_
—
Ratio of total reserves to deposit and Federal reserve note
liabilities combined (per cent)
Contingent liability on bills purchased, for foreign correspondents
_
-'




1,594
3,178

25
27,587
1,920
427

LIABILITIES
F. R. notes in actual circulation
Deposits:
Member bank—reserve account
_.
Government
...
Foreign banks
_
Other deposits—.
—

611
267

53,089

_

76,772
2,548

10,008
6,500

_

69,203
3,189

7,813
2,175
20

_

68,635
8,137

9,001
2,160

_

59,812
9,391

11,161
25,420

Total reserves
Non-reserve cash
Bills discounted:
Secured by U. S. Government obligations.
Other bills discounted
_

41,097
19,090
8,448

76,604
3,410

_

37,643
14,742
7,427

163,062

Total gold reserves
Reserves other than gold..

30,265
33,518
7,284

_.

Dec. 31,
1927
35,804
1,839

71,067
5,537

Gold with Federal Reserve Agent
Gold redemption fund with U. S. Treasury
Gold held exclusively against F. R. Notes
Gold settlement fund with F. R. Board
Gold and gold certificates held by bank

Dec. 31,
1928
27,480
2,785

72,009

65,201

28,654
4,329
8,690
356

27,798
4,263
8,527
268

26,781
4,302
8,215
384

63,062

160,337

153,686

63.3

57.9

67.3

11,306

8,007

1,976

FOURTEENTH ANNUAL REPORT
OF THE

FEDERAL RESERVE BANK OF DALLAS

Business and industry in the Eleventh Federal Reserve
District during the year 1928 reflected a considerable improvement as compared to the year 1927. The distribution of
merchandise in both wholesale and retail channels was in a
larger volume than in the previous year and collections generally were good. The improvement in the financial status of
business was reflected in, the lower business mortality rate,
there being fewer commercial failures than in any year since
1924. Furthermore, the indebtedness of defaulting firms
showed a noticeable reduction from the previous year. Business in general was in a stronger financial condition than in
1927 and bank deposits were at record levels. Construction
activity as measured by the valuation of building permits
issued at principal cities exceeded that of the previous year
by a small margin. The production of petroleum in the district
again reached a new level due to the discovery of new and
prolific fields, and the operations in the industry were more
profitable as there was some recovery from the low level
reached in 1927 in the price of crude oil.
The volume of agricultural production was larger than in
1927 and the gross value of crops again showed a substantial
gain over the previous year. The farmers' net equity in 1923
crops was affected by higher production costs brought about
largely by the adverse weather conditions during the planting
season which entailed heavy expenditures for replanting and
cultivation of crops. The program of diversification which
gained impetus in 1927 was extended in many sections in 1928
and a larger percentage of farmers again made their living at
home. The heavy production of feed crops will be of considerable aid to the farmers in efforts to hold down the cost of
producing 1929 crops.
The year was a very profitable one for the livestock industry. Livestock and their ranges, with few exceptions, were
maintained in good physical condition throughout the year.
The calf and lamb crops were large and losses generally were
few. Cattle prices reflected a steady upward trend during the
first eight months of the year, reaching the highest levels
witnessed since the war period, and trading on the ranges
was active at the high prices. The market, however, reacted
somewhat during the closing months of the year.
The volume of transactions handled by the Federal
Reserve Bank of Dallas during 1928 showed a considerable
increase over that of the previous year, yet, due to a further
increase in the efficiency of the personnel, the departments
of the bank as a whole functioned with practically the same
number of employees as during 1927.




5

FEATURES OF OPERATIONS, YEARS 1928 AND 1927
Number
of Items Amount
26,094 $737,651,383
12,367
122,759,739
5,271
55,972,021
101,158,700
464
79,023,930
1,818

Loans, Rediscounts, and Investments:
Notes discounted and rediscounted for member banks
Bills bought for our own account
_.,
Bills bought for other than our own account
Purchase and sale of securities for own account.
Purchase and sale of securities other than own accountCurrency and Coin:
Bills received and counted
51,124,742
Coin received and counted
43,351,370
Check Collections:
Checks collected
38,761,035
Collection items handled
128,674
Return items
1,063,800
U. S. Government checks paid
1,038,308
U. S. Government coupons paid
492,956
Transfers:
Transfer of funds other than five per cent fund of national
banks
108,691
Transfer of funds for five per cent fund of national banks
17,957
Fiscal Agency:
U. S. Securities issued, converted, redeemed, canceled, and
126,680
exchanged
Custody of Securities:
Number of pieces received from outside sources
36,899
Number of pieces received inter-departmental transactions..
51,546
Number of pieces delivered other than inter-departmental
34,761
Number of pieces delivered inter-departmental transactions..
51,681



1927Number
of Items
Amount
19,275 $281,580,673
8,773
119,970,775
2,822
29,521,278
171,555,550
1,102
30,107,791
696

223,263,259 47,449,190
7,441,471 34,854,533

215,433,525
7,067,104

8,225,957,960 36,097,295
122,814
218,336,519
995,146
39,479,959
901,015
115,553,879
598,390
5,625,002

7,751,047,967
194,864,160
38,998,296
100,412,540
4,750,750

5,043,449,840
48,503,053

93,380
16,334

4,191,300,603
40,430,472

268,791,180

110,724

200,630,024

Not available
Not available
Not available
Not available

29,650
26,757
32,364
26,818

Not available
Not available
Not available
Not available

EARNINGS AND EXPENSES
The gross earnings of the bank in 1928 were $2,119,666,
as compared with $1,741,921 in. 1927, an increase of $377,745
or 21.7 per cent. Of this amount $680,663 or 32.1 per cent
resulted from the purchase of bills, as compared with $430,353
or 24.7 per cent in 1927; $669,514 or 31.6 per cent resulted
from the discount and rediscount of paper, as compared with
$254,984 or 14.6 per cent in 1927.
Current net earnings in 1928 were $874,187, as compared
with $474,584 in 1927, an increase of $399,603 or 84.2 per cent.
The average rate on bills discounted was 4.4 per cent, compared with 3.8 per cent in 1927; and on purchased paper 4.1
per cent, as compared with 3.5 per cent in 1927. The annual
rate of current net earnings to paid-in capital was 20.3 per
cent in 1928, compared with 11.1 per cent in 1927.
Current expenses in 1928 were $1,245,479, as compared
with $1,267,337 in 1927, a decrease of $21,858 or 1.7 per cent.
On December 31, 1927, after adjustments necessary in
closing the books for the year had been made, the bank's
capital was $4,263,450 and surplus $8,526,900. Semi-annual
dividends were paid to member banks on June 30 and December 31, 1928, at the rate of 6 per cent per annum. After
making provision for the usual depreciation allowances and
sundry adjustments $291,609.79 was paid to the United States
Government as a Franchise tax and $163,301.09 was transferred to surplus, making that account $8,690,201.09 on December 31, 1928.
OPEN MARKET OPERATIONS
At the beginning of the year 1928 holdings of United
States Government securities were $31,989,000, of which
$22,959,500 consisted of participation in purchases for the
System by the Open Market Investment Committee.
During the year United States Government securities,
exclusive of participation in System purchases, amounting to
$53,913,550, were purchased in the open market from member
banks and others, while securities aggregating $52,935,200
matured or were sold, representing an increase in our independent holdings of securities of $978,350 and leaving total
holdings of $10,007,850 on December 31, 1928. Our participation in the System's holdings was gradually reduced during
the year to $4,306,500 on December 17, and remained at this
figure until December 24, when the entire amount of our
participation was sold.




The yield on our holdings of Government securities
averaged about 3% P e r cent for the year.
At the beginning of the year holdings of bankers' acceptances amounted to $22,810,773. This amount was gradually
reduced to the minimum of $9,867,451 on July 27, due to
maturities during that period regularly exceeding purchases.
From this figure holdings were increased to $25,857,897 on
December 29, which was the maximum for the year.
Bankers' acceptances amounting to $122,759,739 were purchased in the open market from other Federal Reserve Banks
and member banks during the year, while bills amounting to
$120,150,947 matured or were sold. Holdings amounted to
$25,419,565 on December 31, 1928.
At the beginning of the year buying rates on bankers'
acceptances ranged from 3 per cent to 3% per cent, increasing
slightly from time to time, the range at the close of the year
being 4% per cent to 4% per cent. The average yield on our
holdings of bankers' acceptances for the year was 4.1 per cent.
During the year we purchased debentures of the Federal
Intermediate Credit Bank of Houston amounting to $9,500,000
and our holdings of such debentures at the close of business
December 31, 1928, were $6,500,000.
DISCOUNT OPERATIONS
The volume of paper discounted and rediscounted for
member banks in 1928 was $737,651,383, compared with
$281,580,000 in 1927, an increase of $456,071,883 or 162 per
cent.
Of the total advances to member banks in 1928, 99 per
cent was to national bank members and 1 per cent was to
state bank members, as compared with 96 per cent to national
bank members and 4 per cent to state bank members in 1927.
The minimum borrowings were $2,579,131.83 on February
28 and gradually increased from this figure to $33,794,111.09
on September 4, which was the maximum for the year, and
amounted to $11,161,445.48 on December 31.
Of the total paper discounted in 1928, $589,613,000 or
80 per cent consisted of notes secured by United States Government obligations, as compared with $201,798,000 or 72 per
cent in 1927, an increase in this class of borrowings of
$387,815,000 or 192 per cent.




8

CLASSIFICATION AND DISPOSITION OF NOTES
SUBMITTED BY MEMBER BANKS
DURING 1928
Number
30,165

Number and amount of items received

Amount
$91,162,384.88

CLASSIFICATION
Farming
Commercial
Miscellaneous

$17,447,407.52*
73,027,702.55
687,274.81 $91,162,384.88

REASONS FOR RETURN OF PAPER, SHOWING PERCENTAGE
RETURNED TO TOTAL RECEIVED
Ineligibility
!j
Technical Defects
Insufficient Cr. Information
Credit Showing
Miscellaneous
Total Returned
Total Accepted

..

Total

Percentage
Amount
.52
475,467.71
.33
305,094.90
.33
301.913.48
.83
758,122.56
.08
68,701.79

.$ 1,909,300.44
89,253,084.44
§91,162,384.88

2.09
97.91
100.00

Items Percentage
.43
130
.62
188
.60
179
2.97
896
.15
45
1,438
28,727

4.77
95.23

30,165

100.00

C O N T R I B U T I O N O F M E M B E R BANKS TO T H E CAPITAL STOCK
O F T H E F E D E R A L R E S E R V E BANK O F DALLAS A N D
B R A N C H E S , S E G R E G A T E D AS TO BANKS I N
G R O U P S 1, 2 A N D 3
Group 1
Group 2
Group 3

$2,161,350
1,446,900
720,650
Total

$4,328,900

P E R C E N T A G E S O F A V E R A G E DAILY BORROWINGS FROM T H E
F E D E R A L R E S E R V E BANK O F DALLAS A N D B R A N C H E S
O F E A C H G R O U P T O I T S C A P I T A L STOCK P A Y M E N T
Group 1
Group 2
Group 3

506 %
186%
293%

*Does n o t include $6,500,000 Debentures of t h e Federal Intermediate
Credit Bank of Houston.




RESERVE POSITION

For the first six months of the year the reserve position
of the bank ranged between a maximum ratio of 70.2 per
cent on February 29 (the highest of the year as of weekly
reporting periods) when total cash reserves were $74,902,000,
to a minimum of 54.4 per cent on January 18, when total cash
reserves were $60,618,000.
During the latter half of the year the ratio fluctuated
between a maximum of 68.5 per cent on July 11, when total
cash reserves were $66,696,000, to a minimum of 47.9 per
cent on August 22, when total cash reserves were $46,354,000.
CLEARING OPERATIONS

The volume of checks handled during the year 1928
totaled 39,799,000, amounting to $8,341,512,000, an increase of
2,801,000 in number and value of $490,052,000 over 1927. The
volume during the last three months of 1928 was exceptionally
heavy, which is the seasonal trend due to utilization of funds
realized through the marketing of fall crops. The daily average
number of checks handled during this period was 151,432, as
compared with 139,000 during 1927, and 125,000 during 1926.
The maximum number of items handled in any one day was
224,110 on October 15, 1928.
The privilege of routing checks direct to other Federal
Reserve Banks for credit on the books of this bank was availed
of by 147 member banks in 1928. Notwithstanding the number
of banks availing themselves of the direct routing privilege
which eliminates the handling of items in our office and in
many instances enables the direct sending member to receive
quicker credit, the year just ended witnessed a large increase
in the number of checks which actually passed through our
Transit Department.
During the year 1,063,800 checks were returned for
various reasons, a ratio of one check returned for every 37
items handled. During 1927 the ratio was one to 37.
Clearings through the Reserve City Clearing House during the year aggregated $1,216,222,111, as compared with
$1,146,943,900 in 1927.
Non-cash collection items handled in 1928 totaled 128,674
amounting to $218,336,000, as compared with 122,814, amounting to 194,864,000 in 1927.
The salary expense of the Transit Department was reduced 6 per cent in 1928 over 1927 at the Head Office.




10

MOVEMENT OF MEMBERSHIP

On January 1, 1928, the total number of national banks
in the district was 706. During the year 12 national banks
were chartered; 18 were dropped through liquidation, mergers
and other causes, making a net decrease of six, or a total on
December 31, 1928 of 700.
On January 1, 1928, the total state bank membership
was 101. During the year two state banks were admitted
to membership. The membership of eight state banks was
terminated through liquidation, consolidations and other
causes, making a net reduction of six, or a total state bank
membership on December 31, 1928 of 95.
The total membership, by states, on December 31, 1928,
was:
National State Total
Arizona
4
1 5
Louisiana
15
1
16
New Mexico
19
1
20
Oklahoma
18
1
19
Texas
644
91
735
Total....

700

95

795

DEMAND FOR CURRENCY

The average amount of Federal reserve notes in circulation during 1928 was approximately $4,000,000 less than in
1927. The following table shows the average, maximum and
minimum circulation for 1928, as compared with 1926 and
1927:
1928
1927
1926
Average ....
$38,418,000
$42,320,000
$42,128,000
Maximum
50,811,000
51,596,000
51,970,000
Minimum
29,498,000
34,194,000
34,981,000
The minimum circulation of $29,498,000 in 1928 was in
July, while the minimum in 1927 of $34,194,000 was in June.
In 1928 the maximum circulation of $50,811,000 was reached
December 24, while in 1927 the maximum of $51,596,000 was
on November 5. Money shipments in volume began and ended
a month later in 1928 than in 1927.
Although both the average and maximum Federal reserve
note circulation were less in 1928 than in 1927, there was
an increase from minimum circulation in 1928 of $21,000,000,




11

while the increase from minimum in 1927 was only
$17,000,000.
During1 the autumn shipping season of 1928, the most
important variation was an increased demand for all classes
of currency of approximately $4,900,000 more for the months
of September and October than for the same period last year.
This increase was partially offset by a decreased demand of
approximately $3,500,000 for a portion of the months of July
and November and the month of August in 1928, as compared
to same period in 1927, leaving a net increase of approximately
$1,400,000 for the shipping season of 1928 over season of
1927.
BANK EXAMINATIONS
The Examination Department conducted 94 credit investigations during the year. These visitations covered member
state banks and were made in connection with regular examinations conducted by the state authorities. Two non-member
banks were examined for membership in the System, and one
independent credit investigation of a national bank was made.
The total number of visitations made by the department during 1928 was 97, as compared with 108 in 1927.
BANK RELATIONS

The Bank Relations Department continued the policy of
visiting practically every member bank in the district at least
once during the year. The total number of visits in 1928 was
1,048, as compared, with 1,089 in the preceding year. In
addition to the usual field work carried on by the bank's
regular traveling representatives, a number of banks were
visited by our operating officers, including the branch managers. The field work in 1928 consisted of 770 regular visits
to member banks, 261 to non-member banks, and 17 special
missions handled for various departments of the bank. On
two occasions the department investigated applications for
the organization of new national banks. Speakers for 17
gatherings of various kinds were furnished during the year,
and approximately 1,200 visitors were conducted through the
head 1office and branch buildings. All bankers' conventions,
group meetings and a number of formal openings of new
bank buildings were attended by representatives of this bank.
STOCKHOLDERS MEETING

The second annual meeting of the bank's stockholders
was held in Dallas on July 12, 1928, attended by 154 delegates,
representing 128 member banks. While the attendance was




12

considerably smaller than that of the first stockholders' meeting in 1927, a most interesting program was carried out and
the bank's relations with its member banks were materially
benefited, it is) believed, by the discussions engaged in by
those present. One of the constructive steps undertaken at
the meeting was the appointment of special committees to
study various phases of the Federal Reserve Bank's functions
and operations and to submit recommendations at the next
annual meeting of the Stockholders Association as to ways
and means of improving the bank's service to the public and
to the member banks. To this end, committees were appointed
to make reports on such subjects as the following:
Reserve requirements.
Eligibility of paper for rediscount.
Collection system.
Cost of operation and disposition of earnings.
Stockholders' representation on the Federal Reserve
Board.
Qualifications, mode of election and tenure of office
of directors of Federal Reserve Banks.
Open market operations.
Rediscount rates; uniformity.
Membership requirements.

<

INSOLVENT BANKS DEPARTMENT

Five member banks (four national, one state) in this
district suspended business in 1928, of which one was indebted to this bank. During the year the indebtedness of
three was liquidated without any loss to this bank.
Before the closing of our books for the year ending
December 31, 1928, the indebtedness of all failed banks that
had not previously been charged to funds reserved for losses
was charged to this account, except one, which suspended on
the above date. While there are now fourteen failed banks
indebted to us, the liability of only one amounting to $6,562.52
is carried as an asset on our books.
The personnel of the department consists of two regular
employees.




13

INTERNAL ORGANIZATION AND PERSONNEL

The Board of Directors held twelve meetings in 1923,
with an average attendance of seven.
There was no change in the personnel of the board in
1928.
Mr. J. H. Nail, Class B Director, representing banks in
Group 1, died at his home in Fort Worth on August 2. While
Mr. Nail had been in poor health for a long period, and unable
to attend the board meetings since May, his death was a
shock to his associates on the board and officers of the bank.
At its meeting on September 7, the Board of Directors adopted
the following resolution:
"WHEREAS, The members of the Board of Directors of the Federal
Reserve Bank of Dallas have learned with profound sorrow and regret
of the death of their co-worker, James H. Nail, which occurred in Fort
Worth, Texas, on August 2, 1928; and
WHEREAS, The members of this Board of Directors wish to express
to Mrs. Nail and other members of the family their deepest sympathy
in the loss of their devoted husband and father, whose association was
such a happy feature of the daily life of our friend and business associate; and
WHEREAS, It was the pleasure and privilege of several members of
this Board to be associated with Mr. Nail during his entire official connection with this bank;
THEREFORE BE IT RESOLVED, That, in the death of Mr. Nail
the cattle industry has lost a leader, and the state and community one
whose high character, broad vision and sound judgment readily gained
for him the esteem and respect of those with whom he came in contact.
Mr. Nail's life is an example of rigid honesty, perseverance, unfailing
justice and unselfishness, and in his loss we mourn for one who did much
to forward the interests of this great Southwest.
His cooperation and sound judgment were unsparingly given in shaping the policies of the Federal Reserve Bank of Dallas, in accordance
with conservative and sound banking principles, and his associates on
this Board, and the officers of this Bank, felt honored in being associated
with him.
BE IT FURTHER RESOLVED, That these resolutions be spread
upon the minutes of this institution as an enduring memorial of our
affection for our friend and former associate, and that a copy of these
resolutions be furnished the family of the deceased and the Federal
Reserve Board."

Mr. Nail's term would have expired on December 31, and
with the approval of the Federal Reserve Board the vacanc}7
created by his death was not filled until the regular election
in November.
At its meeting on January 12, 1928, the board re-elected
B. A. McKinney, Vice President of the American Exchange
National Bank of Dallas, as the representative on the Federal




14

Advisory Council for the Eleventh District, and designated
W. E. Connell, President of the First National Bank of Fort
Worth, as alternate.
At the meeting of the directors on January 14, one of
the positions of assistant cashier was abolished and the position of assistant deputy governor created. W. D. Gentry,
senior Assistant Cashier, was elected to fill the position of
Assistant Deputy Governor.
At the same meeting, W. P. Clarke, who had been serving
as Acting General Auditor since the resignation of R. L. Foulks
in September, 1927, was elected General Auditor, and C. C.
True, who had been serving as Acting Assistant Auditor during the same period, was elected Assistant Auditor.
In the regular annual election in November, W. H.
Patrick was re-elected Class A director, Group 3, and A. S.
Cleveland, of Houston, was elected Class B director, Group 1,
to succeed Mr. Nail, for three-year terms, beginning January
1, 1929.
On December 17 the Federal Reserve Board announced
the re-appointment of C. C. Walsh as a Class C director for
the three-year term beginning January 1, 1929, and his redesignation as Chairman of the Board and Federal Reserve
Agent for 1929.
On December 20 the Federal Reserve Board announced
the re-designation of Clarence E. Linz as Deputy Chairman of
the Board for 1929.
There were no changes in the personnel of the directorates of the El Paso and Houston Branches during 1928. At
the San, Antonio Branch there were two changes. On April
3, H. H. Rogers resigned on account of removal from the district and the Federal Reserve Board appointed Frank G. Crow,
of McAllen, Texas, to succeed him. On July 9, F. E. Scobey
resigned on account of ill health and the Federal Reserve
Board appointed John M. Bennett of San Antonio to succeed
him.
On December 31, 1928, the total number of officers and
employees at the head office and branches was 433, a decrease
of five since December 31, 1927.
FISCAL AGENCY OPERATIONS

The volume of business handled as fiscal agent of the
United States in 1928 showed a substantial increase over the




15

year 1927. During the year ten issues of Government securities were floated, as compared with eight issues in 1927, and
there were seven maturing issues, as compared with six in
1927. The volume of interest coupons handled for payment
was slightly less than in 1927, while there was a substantial
increase in the number of Government checks and warrants.
On December 31, 1927, there were eighteen employees
in the department, at an annual salary rate of $35,700, while
on December 31, 1928, there were seventeen regular employees
at an annual salary rate of $34,800, and one temporary employee at an annual salary rate of $960.
OPERATION OF BRANCHES

The volume of business handled at the El Paso Branch
in 1928, compared with that handled in 1927, is reflected in
the following table:
Number
1928
1927
Notes discounted and
rediscounted
640
349
Bills received and
counted
4,292,550 4,368,108
Coin received and
counted
3,430,559 3,474,640
Transfer of funds
9,839
9,294
Check collections
2,752,084 2,488,592
Treasury warrants _ „
169,980
158,757
Non-cash collections...13,196
12,774
Return items
58,057
50,984

Amount
1928

1927

$ 11,976,903

$ 11,070.937

25,208,250

27,377,000

1,185,790
225,146,067
422,913,114
18,292,027
10,578,290
3,245,372

1,250,739
188,686,408
356,970,038
16,878,938
9,353,078
2,766,839

At the beginning of the year forty member banks (thirtyseven national and three state) were attached to the branch.
Included in this number, however, was one national bank
which closed in 1926, but its capital stock had not been surrendered.
During the year the memberships of one state bank and
one national bank were terminated by voluntary liquidation,
one new national bank opened for business and the stock of
the bank mentioned above was refunded, leaving total membership of thirty-eight on December 31, 1928.
The expense of operation, excluding furniture and equipment, was $110,677, as against $115,432 in 1927.
The personnel of the branch on December 31, 1928, comprised two officers and thirty-five employees, which was the
same number in service on December 31, 1927.




16

The volume of business handled at the Houston Branch
in 1928, compared with that handled in 1927, is reflected in
the following table:
1928

Number
1927

Amount
1928

1927

Notes discounted and
rediscounted
812
771 $146,774,494
Bills received and
counted
11,003,124 11,158,705
45,718,051
Coin received and
counted
14,569,378 11,319,894
1,438,404
Transfer of funds_.__
27,806
24,638 1,638,732,616
Check collections—. 6,251,590
6,654,526 1,659,729,632
Treasury warants....
185,329
171,991
22,454,401
Non-Cash Collections
37,441
35,442
58,700,349
Return items
156,317
156,113
6,202,204

$23,722,299
47,150,675
1,260,575
1,541,488,267
1,714,008,937
18,683,171
71,778,878
6,728,490

At the beginning of the year eighty-nine member banks
(seventy-eight national and eleven state) were attached to the
branch. During the year two national banks were added by the
transfer of Victoria County from the San Antonio Branch and
one national bank by conversion of a non-member state bank,
the membership of one state bank was terminated by withdrawal from the system and one national bank consolidated
with a non-member state bank, leaving total membership of
ninety on December 31, 1928.
The expense of operation, excluding furniture and equipment and repairs and alterations, was $149,896.97, as compared with $156,733.76 in 1927.
The personnel of the branch on December 31, 1928, comprised three officers and fifty-three employees, compared with
three officers and fifty-two employees on December 31, 1927.
The volume of business handled at the San Antonio
Branch in 1928, compared with that handled during the six
months the branch was in operation in 1927, is reflected in
the following table:
1928

Number
1927

Amount
1928

1927

Notes discounted and
rediscounted
843
313 $ 20,782,621 $ 7,606,196
Bills received and
counted
9,240,831 4,248,414
40,258,808
19,340,600
Coin received and
counted
4,820,730 2,381,664
1,310,526
766,966
Transfer of funds
14,373
6,371
421,228,447
190,879,634
Check collections
5,210,087 2,454,855
1,026,920,324
490,844,269
Treasury warrants..._.. 160,856
66,952
24,834,928
12,433,023
Non-Cash Collections
14,087
8,236
17,362,878
8,036,090
Return items
113,158
51,088
6,088,601
2,748,215




17

At the beginning of the year 100 member banks (88
national and 12 state) were attached to the branch. Included
in this number, however, was one national bank which consolidated with a state member bank in 1927, the capital stock
of which has not been surrendered. During the year two national banks were transferred to the Houston Branch, one
national bank consolidated with another national bank, one
national bank went into voluntary liquidation and one state
bank terminated its membership by withdrawal from the
system. During the same period one new national bank and
one state bank were admitted to membership, leaving total
membership of ninety-six active members and three members,
the capital stock of which had not been surrendered on December 31, 1928.
The expense of operation, excluding furniture and equipment, was $129,452.88, as compared with $79,015.34 for the
six months' operations of 1927.
The personnel of the branch on December 31, 1928, comprised two officers and forty-nine employees, compared with
two officers and forty-six employees on December 31, 1927.
In the latter part of January construction was begun on
a building consisting of two stories and basement, 80 x 60 in
dimensions, which was completed and occupied by the branch
on October 6, 1928.




18

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