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THIRTEENTH ANNUAL REPORT TO THE FEDERAL RESERVE BOARD BY THE FEDERAL RESERVE AGENT FEDERAL RESERVE BANK SAN FRANCISCO FOR THE YEAR ENDED DECEMBER 31, 1927 THIRTEENTH ANNUAL REPORT TO THE FEDERAL RESERVE BOARD BY THE FEDERAL RESERVE AGENT FEDERAL RESERVE BANK SAN FRANCISCO FOR THE YEAR ENDED DECEMBER 31, 1927 DIRECTORS AND OFFICERS OF THE FEDERAL RESERVE BANK OF SAN FRANCISCO January 1, 1928 Class A B C DIRECTORS Group C. K. MCINTOSH, San Francisco, California President, Bank of California, N . A. THOMAS H . RAMSAY, R e d Bluff, California . . . President, Pacific National Agricultural Credit Corporation, San Francisco, California. *HOWARD W H I P P L E , Turlock, California _ _ _ _ _ President, First National Bank. A. B . C. DOHRMANN, San Francisco, California President, Dohrmann Commercial Company. WILLIAM T . SESNON, San Francisco and Soquel, California Agriculturist. E . H . C o x , San Francisco and Madera, California Vice-President a n d General Manager, Madera Sugar Pine Company, Madera, California. ISAAC B . N E W T O N , LOS Angeles, California Chairman of t h e Board. WALTON N . MOORE, San Francisco, California Deputy Chairman, Chairman of the Board, Walton N . Moore Dry Goods Co., Inc. W M . SPROTJLE, San Francisco, California President, Southern Pacific Company. Term Expires Dec. 31 1928 1929 1930 1929 1930 1928 1929 1930 1928 MEMBER FEDERAL ADVISORY COUNCIL F. L. LIPMAN, representing District No. 12 President, Wells Fargo Bank and Union Trust Co. San Francisco, California OFFICERS ISAAC B. NEWTON, Chairman of the Board and Federal Reserve Agent S. G. SARGENT, Assistant Federal Reserve Agent and Chief Examiner ALLAN SPROXJL, Assistant Federal Reserve Agent and Secretary F. H. HOLMAN, General Auditor R. T. HARDY, Auditor JNO. U. CALKINS, Governor WM. A. DAY, Deputy Governor IRA CLERK, Deputy Governor W. N. AMBROSE, Cashier CHESTER D. PHILLIPS, Assistant Cashier C. E. EARHART, Assistant Cashier H. N. MANGELS, Assistant Cashier E. C. MAILLIARD, Assistant Cashier F. C. BOLD, Assistant Cashier J. M. OSMER, Assistant Cashier *On February 16, 1928, Mr. Whipple resigned from the Board of Directors. A successor for his unexpired term will be elected by the member banks of Group Three. DIRECTORS AND OFFICERS OF BRANCHES January 1, 1928 SPOKANE BRANCH Term Expires Dec. 31 Directors . . . . . G. I . T O E V S , * Chairman PETER MCGREGOR* . R. L. R U T T E R I . G. E . McBROOMf . . D. L. DAVist . . . . 1929 1928 1928 1929 1928 Officers D. L. DAVIS, Managing Director J. M. LEISNER, Assistant Manager EVAN BERG, Assistant Cashier SEATTLE BRANCH CHAS. H.CLARKE,*Chairman H E N R Y A. RHODES* . . . M. F . BACKUsf . . . . M. A. ARNOLDf . . . . C. R. SHAwf 1929 1928 1928 1929 1928 C. R. SHAW, Managing Director B. A. RUSSELL, Assistant M a n a g e r G. W. R E L P , Assistant Cashier PORTLAND BRANCH NATHAN STRAUSS,* Chairman EDWARD C. PEASE* . . . JOHN F . DALYJ . . . . J. C. AINSWORTHI . . . R. B. WESTf 1929 1928 1928 1929 R. B. WEST, Managing Director S. A. MACEACHRON, Assistant Manager J. P. BLANCHARD, Assistant Cashier 1928 SALT LAKE CITY BRANCH LAFAYETTE HANCHETT,* Chairman . . F. J. HAGENBARTH* . L. H. FARNSWORTHf W. L. PARTNER, Managing Director . . . . 1929 . 1928 . 1928 CHAS. H. BARTONI . . . W. L. PARTNERf . . . . 1928 J J . M. CRAFT, Assistant Manager \y. M. Smoot, Assistant Cashier L . W. DALBY, Assistant Cashier 1929 LOS ANGELES BRANCH W . L . V A L E N T I N E , * Chairman J. B. ALEXANDER* . . . HENRY M. RoBiNSONf . . J. F . SARTORif . . . W. M. HALE 1929 1928 1928 . 1929 L. C. MEYER, Assistant Cashier 1928 * Appointed by Federal Reserve Board. W. M. HALE, Managing Director M. MCRITCHIE, Assistant Manager A. J. DUMM, Assistant Cashier fAppointed by Federal Reserve Bank. LETTER OF TRANSMITTAL Federal Reserve Bank, San Francisco, California, February 15, 1928. SIRS: I have the honor to submit the following report concerning conditions in the Twelfth Federal Reserve District and the operations of the Federal Reserve Bank of San Francisco, for the year ended December 31, 1927. Yours respectfully, Chairman of the Board and Federal Reserve Agent. Federal Reserve Board, Washington, D. C. ECONOMIC REVIEW OF THE YEAR 1927 IN THE TWELFTH FEDERAL RESERVE DISTRICT Business in the Twelfth Federal Reserve District proceeded at a slightly slower pace during 1927 than in either 1926 or 1925. Industrial production early showed signs of receding from the high levels of the two preceding years, and some curtailment of operations was evident from the second quarter of 1927 onward. No corresponding recession occurred in distribution and trade, but it is doubtful whether the increase in trade for 1927 was as large as has generally occurred in recent years. Agricultural production during 1927 is estimated to have been above the average of recent years, and improvement in the economic position of the industry is believed to have accompanied favorable changes in price levels of agricultural and non-agricultural commodities during the year. The available supply of credit has at all times been ample for the district's needs. Agriculture As a result of favorable physical conditions, agricultural production during 1927 was larger in the aggregate than in 1926 and above the average of recent years. The unit value of farm products during major crop moving periods also was generally higher in 1927 than in 1926, and this combination of abundant yields and higher prices indicates that gross farm income growing out of the year's agricultural operations was larger than in the previous season. Of the year's developments in agriculture, perhaps none was more important in its economic aspects, than the readjustment which took place in the relative price levels of agricultural and non-agricultural commodities. The extent of the readjustment is indicated by the RATIO INDEX NUMBERS 150 130 IIO 1923 1924 1925 1926 1927 PRICE TRENDS Prices, Non- Agricultural Commodities—Index of United States Bureau of Labor Statistics (1910-1914 prices = 100). Farm Prices—Index of prices of 30 farm products prepared by United States Department of Agriculture (1909-1914 prices = 100). Ratio—Ratio between the two index numbers, indicating general trends in purchasing power of (arm products. Digitized forabove FRASER THIRTEENTH ANNUAL REPORT movement of an index of the farmer's purchasing power, computed by dividing the United States Department of Agriculture's index number of farm products prices at the farm (August, 1909-July, 1914 prices=100) by the Bureau of Labor Statistics' index of wholesale prices of non-agricultural commodities (1910-1914 prices=100). Using average figures for the last six months of each year (months during which farmers sell the bulk of their products) this purchasing power index stood at 90.5 for 1927, 82.1 for 1926, 88.5 for 1925, 85.4 for 1924. Although not all of the important crops of this district are represented in the index, and although some crops are included which are not of great importance here, its major movements may reasonably be assumed to reflect district as well as national conditions. Index numbers prepared by this bank to show the trend of production and value of the principal crops of the district, together with the United States Department of Agriculture's index of purchasing power of farm products, are presented in the following table: Agricultural Production Twelfth Federal Reserve District (1919-1923 Averaee=100) 1927 Volume Value 1926 Volume Value Grains (wheat, barley, oats) 101.8 110.6 Field crops (beans, cotton, potatoes, rice, sugar beets) 127.7 92.0 Fruits (apples, peaches, pears, prunes, raisins, grapes, oranges) 127.9* 113.2* Purchasing power of farm productst (United States) S7 1925 Volume Value 92.7 82.S 94.5 116.7 94.1 110.3 114.0 320.9 106.4 .109.4 108.7 85 95.9 89 •Subject to revision. tfiatio of farm prices (August, 1909-July, 1914 prices=100) to wholesale prices of non-agricultural commodities (1910-1914 prices—100). INDEX NUMBERS INDEX NUMBERS 140 140 00 ^ V 60 1923 1924 1925 VOLUME 7 IOO 1 60 - GRAINS • HELD CROPS • FRUITS 20 - 20 1926 1927 GRAINS FELD CROPS •FRUITS • J J 1923 1924 1925 1926 1927 VALUE Volume and Value of Production of Fifteen Principal Crops in the Twelfth Federal Reserve District. The available statistical record of agricultural marketing activity during 1927 and the two preceding 3Tears reflects the increases and decreases in agricultural production which occurred during that Digitized forperiod. FRASER FEDEKAL RESERVE BANK OF SAN FRANCISCO 7 The major item in the record volume (90,110 carloads) of fresh deciduous fruits shipped from California, as shown in the table below, was 80,709 carloads of grapes. This unusually large movement was well distributed throughout a short marketing season and net financial returns to table and juice grape growers averaged slightly higher than in 1926 or other recent years. Agricultural Marketing Activity Twelfth Federal Reserve District Exports 1927 Wheat (bu.) (Portland and Puget Sound) 45,168,107 Barley (bu.) (San Francisco) 11,504,975 Carlot Shipments Apples (Twelfth District) 42,190 Oranges (California) 57,163 Lemons (California) 13,437 Deciduous Fruits* (California) 90,110 Livestock Receipts at Eight Markets in Twelfth Federal Reserve District Cattle and Calves 1,267,185 Hogs 2,146,659 Sheep 3,510,826 1926 1925 40,968,880 9,135,126 9,479,497 11,210,528 51,962 50,030 13,610 78,022 45,503 37,637 11,753 81,465 1,310,129 2,093,616 3,403,892 1,328,256 2,286,434 3,294,603 *Excluding apples. Note: All figures are for the calendar year, except those for oranges and lemons, which are for the 12 months period beginning November 1st of the preceding year. Continued improvement in the economic condition of cattle and sheep raisers has been a noteworthy feature of the general agricultural situation in this district during 1927. Attractive market prices, particularly for cattle, induced livestock men to finish and sell an unusually large proportion of their marketable stock, and fewer unfinished animals were sent to feedlots for fattening during the winter months of 1927 than was the case in 1926. The reported smaller volume of these so-called "feeder" operations may also be the result of a continuing tendency in the livestock industry to build up breeding herds, a tendency particularly noticeable among sheep raisers. Prices of wool at shearing time were lower in 1927 than in 1926. The year witnessed a change in the trend of wool prices, however, the downward movement which began early in 1925 giving way to an upward movement in the summer of 1927. Livestock on Farms and Ranges Jan. 1st 1928 1927 1926 1925 1924 1923 Twelfth Federal Reserve District Milch Cows Other Cattle 1,405,000 3,738,000 l,397,000t 3,908,000t 1,388,000 4,158,000 1,390,000 4,551,000 1,535,000 4,652,000 1,467,000 4,712,000 Sheep 13,621,000 13,217,000t 12,545,000 12,179,000 12,130,000 11,938,000 Hogs 1,641,000 l,465,000t 1,235,000 1,386,000 1,859,000 1,778,000 tEevised. The generally satisfactory outcome of the agricultural year was marred only by the marketing difficulties of certain groups of producers, notably some of the deciduous fruit growers of California, Oregon, and Washington. Rapid increases in yield, particularly of s THIRTEENTH ANNUAL REPORT prunes, raisins, and canning peaches, during recent years have presented serious marketing problems which are not yet satisfactorily solved. Industry Workers on payrolls of industrial concerns in the Twelfth Federal Reserve District averaged fewer in number and total wage payments were smaller during 1927 than during 1926, an indication that industry generally was not so active in the later as in the earlier year. The principal decreases were recorded in the building, lumbering, mining, and food packing industries. During the first quarter of 1927 there was a seasonal expansion in productive activity and volume of employment was greater than in the corresponding period of 1926. During the second quarter of the year some curtailment of operations was reported and this curtailment persisted to the year-end. Volume of employment in the latter part of the year was below the levels of 1926. Unemployment resulting from the slower pace of industry was aggravated by an unusually large winter influx of workers from other parts of the country. Particular difficulty has been experienced during 1927 in securing satisfactory statistical data concerning the lumber industry. Estimates made by this bank indicate that output of lumber in the Twelfth Federal Reserve District was smaller during 1927 than during 1926. Efforts to keep production within the limits of apparent demand at a price level profitable to producers, met with fair success during the early part of 1927, but during the summer and autumn months output tended to exceed shipments and orders received. This bank's estimates of changes in daily average production of lumber during the months of 1924, 1925, 1926, and 1927, are presented in index number form in the accompanying chart. INDEX NUMBERS 130 120 A no 100 90 80 Ivv 1924 1925 1926 1927 LUMBER PRODUCTION—TWELFTH DISTRICT Indexes of Daily Average Production Adjusted for Seasonal Variation. (1923-1925 Daily Average = 100) Value of building permits issued in 20 principal cities of the district during 1927 was smaller than in any year since 1922. A part of the decrease in value of building permits, as compared with earlier years, may be accounted for by declines in building costs, but, even though allowance be made for this factor, it is apparent that buildwas less active during 1927 than during the preceding four years. Digitized foring FRASER FEDERAL RESERVE BANK OF SAN FRANCISCO 9 A tabular statement of value of building permits issued in principal cities of the Twelfth Federal Reserve District and of construction costs in the United States during recent years follows: Building Activity Twelfth Federal Reserve District i Value of Permits Issued* ., Percentage Change from Value Previous Year Year 1927 1 920 $331,821,393 361 ,387,378 — 8.2 —14.3 /—-Construction Costst—> Percentage Change from Index Previous Year 189 194 — 2.6 0.5 1925 421,594,906 7.5 193 1.0 1924 392,182,245 — (i.(i 191 — 1.5 1923 419,720,721 35.1 194 11.5 1922 310,676,178 48.7 174 —0.3 "Twenty cities. tSource: Federal Reserve Bank of Now York. Annual averages of construction costs, including materials and wages, for the United States. 1913 costs=100. The mining industry was slightly less active during 15)27 than during 1926. Of the principal metals (gold, silver, copper, lead, and zinc) mined in the district, lead was the only one to show increased production over the year period. Prices of these metals have, on the average, been lower during 1927 than during 1926. In the fourth quarter of 1927, the market for silver and copper improved, however, and their December prices were higher than in the same month of 1926. Mineral Production Twelfth Federal Reserve District* Gold Silvert Coppert (oz.) (oz.) (lbs.) Leadt (lbs.) Zinct (tons) 1927 1,154,572 (53.0) 41,402 (69.7) 1,102,760 (66.1) 631,892 (49.0) S2,646 (11.5) .1926 1,200,484 43,039$ 1,119,041$ 626,528$ 96,518$ (51.4) 1,284,331 (53.2) 1,305,273 (51.6) 1,374,201 (54.9) (68.6) 46,338 (70.0) 44,914 (68.7) 48,652 (66.3) (64.9) 1,092,434 (65.1) 1,050,238 (65.4) 942,979 (63.8) (45.9)' 620,586 (45.3) 530,263 (44.4) 492,735 (45.0) (12.5) 48,544 (6.8) 23,643 (3.7) 28,237 (4.6) 1925 1924 1923 "Including all of Arizona, the live southeastern counties of which are in the Eleventh Federal Reserve District. tOOO omitted. +Xot including Arizona, Oregon and Washington. $Bevised. Figures in parentheses indicate percentage of Twelfth District production to that of United States. Production of Portland cement in Pacific Coast states has increased steadily during recent years. During 1927, the output was greater than in any year of record. Portland Cement California, Oregon, and Washington 1927 1926 1925 1924 1923 figures for Montana. Digitized *Includes for FRASER California Oregon and Washington Twelfth District (barrels in thousands) (barrels in thousands) (barrels in thousands) 14,105 13,842 13,098 11,615 11,002 3,508 3,197 3,868* 2,983* 3,105* 17,613 17,039 16,966* 14,598* 14,107* 10 THIRTEENTH ANNUAL REPORT During 1927, production of petroleum in California slightly exceeded production in 1924, 1925, and 1926, and was larger than in any other year, excepting the peak year of 1923. Output of refined oils was greater than in any other year of record. Consumption of crude oil was well maintained, exceeding output, so that stored stocks at the close of 1927 (113,281,630 barrels) were 5.2 per cent smaller than at the beginning of the year. Prices for petroleum and petroleum products were generally lower during 1927 than during 1926. Petroleum i Total (barrels) Production Per Cent California to United States California \ Daily Average (barrels) 1927 230,751,000 25.8 632,196 1926 224,117,000 29.2 614,019 1925 230,147,000 30.4 630,541 1924 230,064,000 32.1 728,590 1923 263,729,000 35.9 722,545 1922 139,671,000 24.8 382,660 1921 114,709,000 23.8 314,271 1920 105,668,000 23.3 288,710 1919 101,564,000 26.7 278,258 1918 97,532,000 27.4 267,211 tComparable figures not available. Source: American Petroleum Institute. Stored Stocks at End of Year (barrels) 113,281,630 119,542,556 127,194,894 97,829,374 89,274,244 t t t t t Average Producing Active Oil Wells Producing Completed Wells 901 913 948 1,238 980 837 704 572 559 586 11,278 11,288 11,393 10,903 8,928 9,410 9,425 9,299 t t More flour was produced in this district during 1927 than in any other year since 1923. Output, as reported by 14 large milling companies producing more than half of the district's total grindings, was 41 per cent larger than in 1926. The increase was a reflection not only of the larger supplies of wheat available in the Pacific Northwest, but also of an improved market demand, for millers' stocks of flour were but 12 per cent larger in volume at the close of the year than at its beginning. The actual amount of this increase in stocks was less than one per cent of total annual production, indicating that consumption or disappearance of flour approximated production during the year. Both flour and wheat prices averaged lower during 1927 than in 1926, and the extent of their declines was about equal to the drop of 5 per cent in the general wholesale price level. Flour Milling Twelfth Federal Reserve District t Flour Production* i Total Monthly Average (barrels) (barrels) 1927 6,010,249t 1926 4,961,319 1925 4,674,316 1924 5,907,329 1923 6,779,155 1922 5,944,977 1921 5,652,981 *14 mills reporting. t Figures for one mill partially estimated. 500,481 413,443 389,526 492,277 564,930 495,415 471,082 —Stocks at Close of Year 1 Wheat Flour (bushels) (barrels) 442,236 396,431 412,192 548,550 569,430 521,501 472,693 3,939,150 2,955,219 4,022,593 2,927,762 3,901,986 4,337,362 2,129,600 The pack of canned foods in the Twelfth District, including canned fruits, vegetables, and fish, although smaller during 1927 than dur1926, was above the average of recent years. Canned fruit packDigitized foring FRASER 11 FEDERAL RESERVE BANK OF SAN FRANCISCO ers entered the year 1927 with heavy stocks of the record 1926 pack still on hand. By means of energetic sales campaigns and substantial price reductions these stocks were disposed of, but the difficulty experienced in marketing them bred curtailment of production in 1927. The Pacific Coast canned salmon pack is estimated to have been smaller in 1927 than in any year since 1921, the size of the pack being largely a reflection of the restricted catch of fish in coast waters during the past year. Canned Fruits and Vegetables Combined Pack California, Oregon, Washington, and Idaho Fruits Vegetables (cases) (cases) 21,657,577 9,569,828 27,477,963 10,429,510 20,323,719 9,620,842 14,631,939 7,795,642 15,260,727 8,430,680 18,900,917 7,509,829 11,211,292 2,815,556 1927 1926 1925 1924 1923 1922 1921 Totals (cases) 31,227,405 37,907,479 29,944,561 22,427,581 23,691,407 26,410,746 14,026,848 Distribution and Trade The total volume of trade transacted in the district during 1927 probably exceeded that of 1926. Railway carloadings of merchandise and miscellaneous freight, an indication of the volume of goods moving through distributive channels, were larger than in 1926 as was the dollar value of sales at retail. Value of sales at wholesale and value of imports and exports, on the contrary, were smaller than in the previous year. Relative decreases in these dollar value figures were not so great, however, as were declines in prices of the principal commodities passing through wholesale and foreign trade channels, and it is estimated that the physical volume of such distribution was larger during 1927 than during 1926. INDEX NUMBERS 90 80 W JlaSf 1925 1926 1927 DISTRIBUTION AND TRADE—TWELFTH DISTRICT Indexes adjusted for seasonal variation. 1923-1925 average = 100. Daily average figures of department store sales and railway carloadings of merchandise and miscellaneous freight. Monthly figures of sales at wholesale. Trade was active at relatively high levels during the first six months of 1927. During the third quarter of the year, there was some contraction in carloadings and in sales at wholesale, a reflection, no doubt, of curtailment of industrial operations. During both the second and third quarters of the year jobbers reported greater difficulty in making collections on outstanding accounts than during the 12 THIRTEENTH ANNUAL REPORT same period of 1926. Toward the year's close, as reports of satisfactory harvesting returns were verified, wholesale trade activity increased and collection conditions improved. The decline in carloadings extended into the last quarter of the year, however, and during November and December, 1927, district loadings were smaller than in the corresponding months of 1926. The general trend of sales at retail was upward throughout the year. The rate of stock turnover of reporting retail stores amounted to 2.99 for 1927, a figure approximately the same as that computed for 1926 (2.96). Distribution and Trade Twelfth Federal Reserve District Index Numbers (1923-1425 annual averajfe = 100) 1927 1926 1925 1924 Carloadings, Total 112 113 108 97 Carloadings, Merchandise and Miscellaneous II1 r> 1 1 2 108 98 Imports* 114 118 104 100 Exports 124 127 102 108 Sales at Wholesale 97 100 101 98 Sales at Eetail 115 112 105 99 Stocks, Retail 108 101 102 103 Stock Turnover, Retailt , . 2.99 2.9(5 2.71 2.55 "Excluding silk, tActual turnover (times per year) at 27 department stores. Instalment sales were larger in amount during 1927 than during 1926. Instalment accounts outstanding at reporting stores increased more than 10 per cent during the later year, whereas total sales of these stores increased only three per cent. Collections on instalment accounts were generally slower than in 1926, particularly during the last half of the year. Collections on regular charge accounts at retail were maintained during 1927, at or above the level of 1926. Sales of new automobiles in the district were considerably smaller in number during 1927 than during 1926. The decrease, which was particularly marked during the last half of 1927, was probably due in large part to the discontinuance of production and partial discontinuance of distribution of Ford cars during the last eight months of the year. The decline in sales of new automobiles also may have reflected some reduction in consumer purchasing power and a tendency toward redistribution of expenditures from total annual income. Banking and Credit Changes in banking and credit conditions in the district during the year 1927 reflected, with considerable accuracy, seasonal and other changes in the general business situation. During the first half of the year, fluctuations in demand for credit accommodation at member banks and at the Federal Keserve Bank were largely seasonal in character. During the second half of the year the changing credit situation reflected a moderate recession in industry and in some lines of trade, as well as the usual seasonal influences. It was during this period of declining business activity that the rediscount rate of the Federal Keserve Bank of San Francisco was reduced from 4 to 3y* per cent, the lower rate becoming effective on September 10, 1927. The 4 per cent rate had been in effect since November 23, 1925. Following a seasonal decline at the beginning of the year, total Digitized forloans FRASER of reporting member banks of the district increased somewhat, 13 FEDERAL RESERVE BANK OF SAN FRANCISCO apparently reflecting the increased demand for credit to meet the requirements of more active trade and industry in the spring. Investments also increased during the period, and the growth in total loans and investments was accompanied by a temporary increase in the volume of member bank borrowing at the Federal Reserve Bank. The second quarter of the year 1927 witnessed a seasonal decline in the demand for credit which continued during the summer months, reflecting curtailment of industrial and trade activity and delay in harvesting the district's crops. Loans of member banks in leading cities declined throughout most of the period and, except for a temporary increase during June, investments also declined while deposits remained at a relatively high level. Thus with available funds abundant in relation to the demand for credit, member banks were enabled to reduce the volume of their borrowing at the Federal Reserve Bank, and in September daily average holdings of discounted bills at the Federal Reserve Bank of San Francisco, at $35,597,000, were smaller than at any time since February, 1926. MILLIONS OF DOLLARS 1500; *«*• ' •—»—»-g——— LOANS AND DISCOUNTS IOOO DEMAND TIME DEPOSITS DEPOSITS • «*" INVESTMENTS 500 - BOR ROWINGS FROM FEDERAL 1924 1925 1926 RESEFtVE BANK 1927 REPORTING MEMBER BANKS—TWELFTH DISTRICT Demand Deposits, Time Deposits, Loans and Discounts, Investments, and Borrowings from Federal Reserve Bank (as of the last Wednesday of each month) During the early autumn and in closing months of the year member banks in leading cities added considerable amounts to their investment holdings; in late September and in October while the bulk of the district's crops was being marketed there was also a temporary growth in the loans of these banks which reached a seasonal peak of $1,291,000,000 on October 11th. For the first time since 1921, and contrary to the experience of most previous years, the high point of the autumn borrowing at member banks in leading cities was below that of the previous spring ($1,317,000,000 on March 9, 1927). Increase in loans and investments was accompanied by continued growth in the volume of deposits at member banks. The seasonal increase in the demand for credit incident to the movement of the district's crops resulted in a temporary increase in the demand for member bank accommodation at the Reserve Bank. Discounts at the Federal Reserve Bank of San Francisco increased from $30,000,000 to more than $59,000,000 (the high point of the year) during the crop moving period. The latter figure, reached on October 11, 1927, -l-i THIRTEENTH ANNUAL REPORT was $9,000,000 (13.6 per cent) smaller and came two weeks later than the 1926 autumn peak ($68,694,000 on September 29, 1926). With the passing of the peak of the agricultural marketing season in late October and early November, reporting member bank loans again declined and discounts at the Federal Reserve Bank of San Francisco were again reduced. Toward the close of the year, the incidence of demand for credit tended to shift from industry and agriculture to trade, and loans at reporting member banks increased to a seasonal holiday peak of $1,306,000,000 on December 21, 1927. Heavier borrowing at the Reserve Bank during this period reflected chiefly the usual Christmas holiday demand for currency, and also the increase in the reserve requirements of member banks. From mid-December to the end of the year seasonal liquidation reduced the volume of loans at member banks and of member bank discounts at the Reserve Bank. MILLIONS OF DOLLARS FEDERAL RESERVE NOTE CIRCULATION U.S. SECURITIES AND BILLS BOUGHT 1924 1925 1926 1927 FEDERAL RESERVE BANK OF SAN FRANCISCO Total Reserves, Federal Reserve Note Circulation, Investments (U. S. Securities and Bills Bought), and Bills Discounted (as of the last Wednesday of each month) At no time during the year was there any lack of credit for agriculture, commerce and industry, and the amount of Federal reserve funds in use was at all times relatively small. FEDERAL RESERVE BANK OF SAN FRANCISCO 15 OPERATIONS OF THE FEDERAL RESERVE BANK OF SAN FRANCISCO DURING 1927 In the field of internal organization and operation, the thirteenth year of the Federal Reserve Bank of San Francisco differed little from those which immediately preceded it. A substantial gain in total volume of operations was recorded, but only moderate use was made of the bank's facilities having to do with grant of credit. Earnings of the bank, while smaller than in 1926, were sufficient to pay all expenses and the legally prescribed dividend, and to provide for an increase in surplus approximating half a million dollars. Some measure of the principal operations of the bank during the past three years is*afforded by the figures in the table on page 26. Although similar figures are not available for all of the thirteen years since the organization Tof the Federal Reserve Bank of San Francisco, an idea of the grow th in size and importance of its operations may be gained from the following comparisons of items taken from condition statements of the bank on corresponding dates in 1915 and 1927: _ Resources November 30, 1927 November 30 1915 Gold Eeserves Bills Discounted Bills Bought Securities All Other Eesources $264,157,000 41,254,000 7,622,000 45,797,000 58,622,000 $17,730,000 687,000 521,000 2,136,000 4,607,000 Total Eesources $417,452,000 $25,681,000 November30, 1927 November 30, 1915 $169,180,000 175,432,000 9,302,000 16,121,000 47,417,000 $ 4,370,000 17,327,000 3,941,000. $417,452,000 $25,681,000 w. ...... Liabilities Federal Eeserve Notes in Circulation Member Bank Deposits Capital Paid in Surplus All Other Liabilities Total Liabilities 43,000 Statement of Condition A comparative statement of condition of the Federal Reserve Bank of San Francisco as of December 31, 1927, and December 31, 1926, is presented below, with such explanatory remarks as will aid in its interpretation. Changes over the year period have been relatively unimportant and it is not necessary to call attention here to the movement of particular items. It should be pointed out, however, that the figures shown for reserves and for bills discounted at the year-end, and particularly as of December 31, 1927, are misleading to the extent that they represent a purely temporary movement of these items. Some member banks, for traditional reasons, prefer not to appear as debtors of the Federal Reserve Bank in their annual published statements of condition, and these banks liquidate their borrowings for a few days at the year-end. Some reference should also be made to the decline shown in holdings of acceptances bought in the open market over the year period. During the later months of for 1927 a considerable volume of acceptances was purchased in the Digitized FRASER 16 THIRTEENTH ANNUAL REPORT San Francisco market for the account of other Federal reserve banks, so that the decline in the San Francisco Reserve Bank's holdings does not represent a corresponding decline in Pacific Coast acceptance offerings. Statement of Condition—Federal Reserve Bank of San Francisco RESOURCES Cash Reserves held by this bank against its deposits and note circulation: Gold and Gold Certificates in vault Gold in the Gold Settlement Fund lodged with the Treasurer of the United States for the purpose of settling current transactions between Federal Reserve Districts Dec. 31,1927 Dec. 31,1926 $ 29,363,981.92 $ 39,942,315.21 55,318,623.69 29,760,448.59 Gold Held by the Federal Reserve Agent as part of the collateral deposited by the bank when it obtains Federal Reserve notes. This gold is lodged in his name partly in the vaults of the bank and partly with the Treasurer of the United States. .'. 1226,184,1)95.00 185,587,365.00 Gold Redemption Fund in the hands of the Treasurer of the United States to be used to redeem such Federal Reserve notes as are presented to the Treasurer for redemption 1,S74,596.23 2,959,626.62 Legal Tender Notes, Silver, and Silver Certificates in vaults of the bank (available as reserve against deposits only) 6,942,838.00 6,620,311.00 Total Cash Reserves $319,685,034.84 $264,870,066.42 Loans and Investments Loans to Member Banks: Secured by obligations of the United States $ 985,200.00 By the discount of commercial or agricultural paper or acceptances 4,234,629.79 $ 7,632,100.00 26,567,262.97 Acceptances bought in the open market 13,842,131.91 31,374,221.26 United States Government bonds, notes, etc. 46,075,350.00 40,667,200.00 $ 65,137,311.70 $106,240,784.23 Total Loans and Investments (or Earning Assets) Uncollected Items Checks and Other Items Not Yet Collected. . . $ 41,483,934.81 $ 45,766,738.37 Miscellaneous Resources Bank Premises Non-Reserve Cash, consisting largely of National Bank notes and minor coin All Other Miscellaneous Resources Total Miscellaneous Resources TOTAL RESOURCES $ 3,373,761.51 $ 3,397,325.49 4,456,751.99 3,760,840.65 834,339.51 1,191,642.67 $ 8,664,853.01 $ 8,349,808.81 $434,971,134.36 $425,227,397.83 FEDERAL RESERVE BANK OF SAN FRANCISCO LIABILITIES Currency in Circulation Dec. 31,1927 Federal Reserve Notes in actual circulation, payable on demand. These notes are secured in full by gold and discounted and purchased paper $176,399,835.00 Deposits Reserve Deposits maintained by member banks as legal reserves against the deposits of their customers $189,268,430.42 United States Government Deposits 1,704,276.87 Other Deposits, including foreign deposits, deposits of non-member clearing banks, etc. 5,000,925.27 Total Deposits 1 / Dec. 31,1926 $187,109,150.00 $163,332,389.62 532,150.54 7,797,104.69 $195,973,632.56 $171,661,644.85 Deferred Availability Items Deferred Items, composed mostly of uncollected checks on banks in all parts of the country $ 36,598,114.02 $ 41,511,112.79 Miscellaneous Liabilities Reserves and All Other Miscellaneous Liabilities 68,116.51 $ 168,615.77 Capital and Surplus Capital Paid In, equal to 3 per cent of the capital and surplus of member banks $ 9,302,150.00 Surplus as permitted by law 16,629,286.27 $ 8,655,950.00 16,120,924.42 $ Total Capital and Surplus TOTAL LIABILITIES $ 25,931,436.27 $ 24,776,874.42 $434,971,134.36 $425,227,397.83 Earnings and Expenses Average holdings of all classes of earning assets at the Federal Reserve Bank of JSan Francisco were smaller during 1927 than during 1926 and rates of discount averaged lower in the later than in U S TREASURY SURPLUS DIVIDENDS CHARGE-OFFS EXPENSES ERRED FROM SURPLUS 1922 1923 1924 1925 4.5 3.8 1926 1927 EARNINGS A N D EXPENSES Amount and Distribution of Earnings of the Federal Reserve Bank of San Francisco (in millions of dollars) Charge-offs represent chiefly depreciation allowances on bank premises, reserve for probable losses, and cost of furniDigitized ture for and FRASER equipment purchased. is THIRTEENTH ANNUAL REPORT the earlier year. As a result, gross earnings of the bank at $3,853,442 for the year 1927 were $701,000 or 15.4 per cent below the figure for 1926. Current expenses were approximately the same in 1927 as in 1926 despite a general increase in total volume of business transacted. Deductions from gross earnings, other than for current expenses declined during 1927 as compared with 1926, a large decrease in the amount set aside as reserve for probable losses more than offsetting moderate increases in reserves for depreciation of bank premises and in the furniture and equipment account. These latter increases were the result of the occupancy of the new Salt Lake City branch building early in 1927, while the decline in the amount allotted to reserve for probable losses reflects the clearing up of a difficult banking situation which had Its inception in 1919, 1920, and 1921. The principal sources of earnings of the Federal Reserve Bank of San Francisco during 1927 and 1926, with an enumeration of the major classifications of operating expenses and a statement of distribution of net income, are presented in the following table: INCOME AND DISBURSEMENTS Earnings 1927 1926 On Loans to Banks and Paper Discounted for Them $1,676,695.99 $1,867,134.26 630,905.95 896,498.22 1,395,670.89 1,586,101.39 150,168.90 205,126.16 $3,853,441.73 $4,554,860.03 $2,249,151.70 $2,232,925.71 For Assessments for Federal Reserve Board Expenses 54,788.66 49,630.19 For Federal Reserve Currency, mainly the cost of printing new notes to replace worn notes in circulation, and to replenish the stock unissued and on hand 157,006.58 136,829.77 For Furniture and Equipment 144,047.76 99,429.80 For Reserves for Depreciation 140,953.68 125,753.78 52,069.94 354,291.53 $2,798,018.32 $2,998,860.78 NET INCOME available for dividends, additions to surplus, and payment to the United States Government $1,055,423.41 $1,555,999.25 On Acceptances Purchased On United States Government Obligations Owned Other Earnings Total Earnings Deductions from Earnings For Current Bank Operation For Reserves for Probable Losses on advances to member banks Total Deductions from Earnings 19 FEDERAL RESERVE BANK OP SAN FRANCISCO INCOME AND DISBUBSEMENTS—Continued 1927 1926 Distribution of Net Income In Dividends Paid to Member Banks, at the rate of 6 per cent on paid-in capital $ 547,061.56 In Additions to Surplus—The bank is permitted by law to accumulate out of net earnings, after payment of dividends, a surplus amounting to 100 per cent of the subscribed capital; and after such surplus has been accumulated to pay into surplus each year 10 per cent of the net income remaining after paying dividends 508,361.85 $ 506,067.94 1,049,931.31 In Payment to the United States Government, as a franchise tax representing the entire net income of the bank after paying dividends and making additions to surplus (as above). No balance remained for such payments in 1926 and 1927 TOTAL NET INCOME DISTRIBUTED —0— —0— $1,055,423.41 $1,555,999.25 Federal Reserve Note Issues A marked change in the proportions of the two kinds of collateral held as security against outstanding Federal reserve notes (partly held by the Federal Reserve Bank and partly in actual circulation) is the most striking feature of the comparative statement of note accounts of the Federal Reserve Agent at San Francisco as of December 31, 1927 and 1926. The amount of gold pledged as collateral for the issuance of Federal reserve notes increased from $185,587,365 to $226,184,995 over the year period while the amount of eligible paper* pledged for the same purpose declined from $65,445,264 to $17,612,559. This movement is the result of the same temporary in^ fluence (see page 15) which caused reserves of the Federal Reserve Bank to increase and its holdings of discounted bills to decline at the close of 1927. The figures serve, nevertheless, to call attention to the relatively large gold cover behind Federal reserve notes during recent years. The following table shows the principal items of the Federal Reserve Agent's note accounts as of December 31, 1927 and 1926, Federal Reserve Agent's Note Account 1927 Federal reserve notes received from Comptroller of the Currency—Net figure as of December 31 $296,828,995 Federal reserve notes on hand—December 31 62,100,000 Federal reserve notes issued and outstanding— December 31 $234,728,995 Collateral pledged by Federal Eeserve Bank against outstanding Federal reserve notes—December 31: Gold and gold certificates $226,184,995 Eligible paper 17,612,559 Total collateral $243,797,554 1926 $284,891,365 53,300,000 $231,591,365 $185,587,365 65,445,264 $251,032,629 *Notes, drafts, bills of exchange, or acceptances acquired by discount under the provisions of Section 13 of the Federal Reserve Act, or bills of exchange, endorsed by a member bank, or banker's acceptances purchased under the provisions of Seetion 14 of that Act. 20 THIRTEENTH ANNUAL REPORT Member Bank and Public Relations The official staff of the Federal Reserve Bank of San Francisco has continued to conduct such member bank and public relations work as is deemed necessary and desirable. In 1927, as in previous years, many of the member banks and not a few non-member banks of the district were visited by one or more of the bank's officers. Frequent response was made to requests for speakers on the Federal Reserve System, and miscellaneous other activities which furthered the public relations of the bank were encouraged. Movement of membership was dominated during 1927, as in other recent years, by the spread of branch banking in California. ConChanges in Bank Membership During the Year 1927 (By Class of Bank) i Member Banks\ , Number -i •, Resources National State Total (in thousands) Active member banks—December 31,1926 568 153 721 $3,664,331) 10 ... 10 4,580 3 1 2* ... 3 ... ... 3 3 1 2* 1,80(5 12,57!) 70S (401,977)t 1* ... Is ( Additions to Membership: Organizations of National banks Conversion of non-member banks to National banks Admission of State banks Resumption following suspension . . . . Conversion within the System Succession between member banks of same class TOTAL ADDITIONS 17 3 l,935)t 20 $19,593 6 0 ... 41 S 1 15 ($219,002)t ( 242,510) t 86 7,678 1 13 Losses to Membership: Merger between member banks: Fntraclass Tnterclass Voluntary liquidations Suspension or insolvency Absorption of member by non-member banks Conversion of member to non-member banks Withdrawal of State banks Conversion within the System Succession between member banks of same class TOTAL LOSSES 35$ 2 1 8 12 1 1 2* 1* 59 Net Change —42 Active member banks—December 31,1927 526 ... 24 —21 132 12,768 1 1 2* 12,012 1,906 (461,977) t 1* ( 83 —63 658 1,935) t $34,450 —$14,857 $3,937,93911 "Changes not affecting total number of banks. tChanges not affecting total resources of member banks. ^Includes 26 banks which were absorbed by non-member banks and subsequently absorbed by a member State bank which converted into a National bank. IJShows a gain of $273,600,000 during 1927. Gain of $288,457,000 due to increases in resources of member banks in system throughout year, partially offset by loss of $14,857,000 shown in table due to changes in bank membership. 21 FEDERAL RESERVE BANK OF SAN FRANCISCO tinned absorption of so called unit member banks by large branch banking systems in that state resulted in a decline in the total number of member banks in the district from 721 on December 31, 1926, to 658 on December 31, 1927. This movement has been in progress, in approximately its present dimensions, since the close of 1921 when 837 national and State banks held stock in the Federal Reserve Bank of San Francisco. Loss in numerical strength under these circumstances has no significance insofar as the resources of member banks, or the proportion of those resources to the total banking resources of the district, are concerned. During 1927 total resources of all member banks increased from $3,664,339,000 to $3,937,939,000, a gain of $273,600,000, or 7.5 per cent. Legislative changes in the laws relating to the establishment and maintenance of branches of national and state member banks f ocussed attention on the branch banking situation in California during the early part of 1927. Amendment of that section of the Federal Reserve Act relating to branches of State member banks and of those sections of the revised statutes of the United States relating to branches of national banks was effected February 25, 1927, and matters which had previously been subject to administrative interpretation and regulation by the Federal Reserve Board and the Branch Banks in California Date Number of Banki Number of anches 10 58 355 230 $1,551,747,457 755,959,950 74 585 $2,307,707,407 16 85 449,361,819 90 670 $2,757,069,226 8 47 174 186 $ 859,438,000 666,191,000 55 360 $1,525,629,000 13 448 1,432,916,000 68 808 $2,958,545,000 Total Resources Dec. 31, 1020: State Banks—Member Non-Member Total number of State banks having branches *Total number of National banks having branches Total Dee, 31, 1927: State Banks—tMember Non-Member Total number of State banks having branches *Total number of National banks having branches Total * Includes Bank of California, N. A., San Francisco, California, with branches at Portland, Oregon, and Seattle and Tacoma, Washington. t Includes one foreign branch of the American Trust Company, San Francisco, California. 22 THIRTEENTH ANNUAL REPORT Comptroller of the Currency became subject to law. The amended paragraph of the Federal Reserve Act (paragraph two, Section nine) now reads as follows: "Any such State bank which, at the date of the approval of this Act, has established and is operating a branch or branches in conformity with the State law, may retain and operate the same while remaining or upon becoming a stockholder of such Federal reserve bank; but no such State bank may retain or acquire stock in a Federal reserve bank except upon relinquishment of any branch or branches established after the date of the approval of this Act beyond the limits of the city, town, or village in which the parent bank is situated." Immediately prior to the effective date of this amendment to the Act there was, for obvious reasons, a rapid increase in the establishment of additional branches of both member and non-member State banks. The branches then established by member State banks were qualified for retention within the Federal Reserve System. Similarly, many of the non-member State bank branches then established could later be brought into the System either directly, the parent bank obtaining membership, or indirectly by consolidation of the parent bank with a national bank, under the permissive features of the amended statutes governing branches of national banks. The last ten months of 1927 brought a further but less rapid development of branch banking in California, principally on the part of non-member State bank interests. On December 31, 1927, total resources of branch bank systems in California were approximately 74 per cent of total resources of all banks in the State. In order to establish a more intimate knowledge of the condition of member banks, the Federal Reserve Bank of San Francisco planned and carried out a heavier program of bank examination work in 1927 than in immediately preceding years. To care for the increased volume of work and to facilitate credit investigations of the large branch banking systems, three examiners were added to the bank's staff early in the year. Twenty-two independent credit investigations were made of national and State member banks as compared with three in 1926, and 97 credit investigations were carried on simultaneously with examinations made by national and State bank examiners, as compared with 87 in 1926. A tabular summary of examinations and credit investigations made by the Federal Reserve Bank of San Francisco during the year 1927 follows: Member Bank Examinations Independent examinations (for admission) 4 Examinations made concurrently with National and State Banking Departments 0 Independent credit investigations: State banks 16 National banks 6 Concurrent credit investigations: With State examiners 95 With National examiners 2 TOTAL NUMBER OF EXAMINATIONS AND INVESTIGATIONS MADE 123 FEDERAL RESERVE BANK OF SAN FRANCISCO 23 The two largest branch banking systems in California were converted from State to national banks during 1927 with a consequent shift in the examination burden from the State Banking Department to the office of the National Bank Examiner for the district. Examiners and other employees of the Federal Reserve Bank of San Francisco were loaned to the national authorities to assist in the examination of these banks, with their 317 branches and, continuing previous practice, assistance was given the State Banking Department in examining a large State member bank with 94 branches. The following quotation concerning the research and statistical work of the bank, taken from the Annual Report for the year 1926, will again serve to describe that phase of the bank's activities. "The Monthly Review of Business Conditions, prepared under the direction of the Chairman of the Board and Federal Reserve Agent at San Francisco was published throughout the year and distributed without charge to approximately 9,000 banks and interested individuals. The Division of Analysis and Research of the Federal Reserve Agent's office, which is currently engaged in the study of business and credit conditions, has distributed such of its findings as are of a public nature, both through the medium of the Monthly Review and by means of special reports and correspondence. In addition it has maintained files of statistical material, relating to the Twelfth Federal Reserve District and to the United States, which are becoming an increasingly important source of public information." Bank Organization and Personnel On December 31, 1927, the terms of three directors of the Federal Reserve Bank of San Francisco, Howard Whipple of Class A, William T. Sesnon of Class B, and Walton N. Moore of Class C, expired. Mr. Whipple, President of the First National Bank of Turlock, California, was re-elected as Class A director by the member banks of Group Three (those having a combined capital and surplus of less than $125,000) for a term of three years ending December 31, 1930.* Mr. Sesnon, agriculturist of San Francisco and Soquel, California, was re-elected by the banks of Group Two (those having a combined capital and surplus not exceeding $599,999 and not less than $125,000) for a similar three-year term as director of Class B. The Federal Reserve Board reappointed Mr. Moore of San Francisco, California, a Class C director for a term of three years ending December 31, 1930, and redesignated him Deputy Chairman of the Board for the year 1928. Isaac B. Newton of Los Angeles, a Class C director, whose term expires December 31, 1929, was likewise redesignated Chairman of the Board and Federal Reserve Agent for the year 1928. To represent the Twelfth Federal Reserve District on the Federal Advisory Council during the year 1927, the Board of Directors chose Henry S. McKee, President of Barker Brothers, Inc., Los Angeles, *On February 16, 1928, Mr. Whipple resigned from the Board of Directors. A successor for his unexpired term will be elected by the member banks of Group Three. 24 THIRTEENTH ANNUAL REPORT California, lie having served in that capacity during the two preceding years and it being the custom to elect such representatives for three successive terms, t In the appointment of directors of branches of the Federal Reserve Bank of San Francisco, it was decided during 1927 to revert to the practice of the years prior to 1925, namely, to have only five directors at each branch instead of, as in the past three years, having seven. To effect this reduction, no new appointments to the directorates of the five branches of the bank were made at the close of 1927, and nine directors who had served the three-year terms for which they were appointed, retired from office. (A tenth vacancy in the branch directorates had been in existence since January, 1927.) Otherwise the personnel and general organization of the branch boards of directors was unchanged. The following changes in the official staff of the bank took place during 1927: Resignations: June 30—R. B. Motherwell, Managing Director, Los Angeles Branch, resigned to accept position as Vice President, Wells Fargo Bank and Union Trust Company. December 31—L. C. Pontious, Deputy Governor, Head Office, resigned to accept position as Vice President, Anglo & London Paris National Bank, San Francisco. December 31—A. C. Agnew, Counsel, Head Office, resigned to return to private practice. Mr. Agnew has been retained as counsel by the bank. Appointments: June 1—L. W. Dal by, Chief Clerk of Salt Lake City Branch, was appointed Assistant Cashier, Salt Lake City Branch. July 1—W. M. Hale, Assistant Cashier, Head Office, was transferred to Los Angeles Branch as Managing Director of the branch. July 1—J. M. Osmer, formerly Auditor, Head Office, was appointed Assistant Cashier, Head Office. July 1—11. T. Hardy, formerly Chief Accountant, Head Office, was appointed Auditor, Head Office. Effective January 1, 1928—G. W. Relf, formerly accountant at Seattle Branch was appointed Assistant Cashier, Seattle Branch. tOn January 5, 1928, F. L. Lipman, President of the Wells Fargo Bank and Union Trust Company of San Francisco was elected to serve as the representative of the Twelfth Federal Reserve District on the Federal Advisory Council during the year 1928. FEDERAL RESERVE BANK OF SAN FRANCISCO 25 Following is a comparative summary of the number of officers and employees in the principal departments of the bank, with corresponding aggregate annual salaries paid on January 1, 1927, and January 1, 1928. (Figures are for Head Office and branches combined.) Personnel and Salaries Officers and Employees Number Annual Salaries Jan. 1, Jan. 1, Jan. 1, Jan. 1, 1928 1927 1928 1927 31 32 $ 241,000 $ 243,600 OFFICERS EMPLOYEES BY DEPARTMENTS: Banking Department Federal Eeserve Agent's Department Auditing Department Fiscal Agency Department TOTAL 758 29 7 16 747 25 8 21 1,177,417 77,180 15,180 29,580 1,150,885 60,180 17,340 37,260 841 833 $1,536,757 $1,508,765 2 2 4,200 4,080 25 23 27,923 25,735 $1,568,940 $1,538,580 FISCAL AGENCY DEPARTMENT EMPLOYEES (whose salaries are reimbursed by the Treasury Department) OTHER EMPLOYEES (whose salaries are reimbursed to the bank, including building employees in space rented to tenants) GRAND TOTALS TEMPORARY EMPLOYEES 868 858 1 8 (not included in above) 1,500 9,660 NOTE Detailed statistical tables pertaining to the Twelfth Federal Reserve District and the Federal Reserve Bank of San Francisco will appear in the Annual Report of the Federal Reserve Board. Copies of the Board's report may be obtained, when published, from the Federal Reserve Board at Washington, D. C. 26 THIRTEENTH ANNUAL REPORT PRINCIPAL OPERATIONS FEDERAL RESERVE BANK OF SAN FRANCISCO The following table presents in comparative form for the past three years the volume of the principal operations of the bank, which are of such character that they can be expressed in quantitative terms. 1927 Supplying- Currency and Coin Currency Received and Counted: Individual notes counted Dollar amount received and counted Coin Received and Counted, a service previously performed largely by the Subtreasury, but now entirely in the hands of the Federal Reserve Bank: Number of coins handled in receiving and counting Dollar amount received and counted. .. . Making: Loans and Investments Bills Discounted for Member Banks, either discounted customers' paper or advances against notes of member banks secured by collateral in the form of United States government securities or commercial or agricultural paper: Number of bills discounted Dollar amount* Bills Purchased for the Account of this Bank: Number. .. Dollar amount 1926 1925 124,442,000 111,583,000 98,574,000 $927,786,000 $881,019,000 $782,218,000 109,252,000 79,311,000 54,425,000 $46,482,000 $42,428,000 $31,063,000 30,136 28,264 21,044 $2,949,165,000 $2,418,031,000 $2,152,987,0001 29,601 $343 586 000 q i rrp-7 Ox ,OU / $321,122,000 26,983 $280,994,000 Collecting- Checks, Drafts, Notes, and Coupons Checks handled for collection for banks in all parts of the country: 73,062,000 74,822,000 77,395,000 Number of items $14,310,906,000 $15,627,527,000 $15,002,811,000 Dollar amount Collection Items handled, including drafts, notes, and coupons: 3,350,000 3,002,000 2,850,000 Number of items $344,932,000 $302,151,000 $369,624,000 Dollar amount Supplementary Services United States Government Securities issued, redeemed, or exchanged, including government bonds, notes, and certificates of indebtedness: 613,000 345,000 362,000 Number of items $218,985,000 $260,294,000$ Dollar amount $560,781,000 Funds Transferred by Telegraph to and from all parts of the country for the Treasury Department and for member banks: 145,000 140,000 128,000 Number of transfers $14,998,311,000 $12,268,428,000 $10,672,119,000 Dollar amount •Includes paper discounted for Federal Intermediate Credit Banks at Berkeley, California, and Washington, amounting to $9,197,000 in 1927; $7,264,000 in 1920, and $1,651,000 in 1925. Digitized forSpokane, FRASER tRevised figure; shown as $2,154,200,000 in Eleventh Annual Report. JRevised figure; shown as $260,304,000 in Eleventh Annual Report. TWELFTH FEDERAL RESERVE DISTRICT Includes the states of Arizona, except the five Southeastern Counties, California, Idaho, Nevada, Oregon, Utah and Washington Map showing territory of Head Office and Branches of the Federal Reserve Bank of San Francisco
@FedFRASER