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Annual Report 1974 Comptroller of the Currency The Administrator of National Banks James E. Smith Comptroller of the Currency Letter of Transmittal TREASURY DEPARTMENT, OFFICE OF THE COMPTROLLER OF THE CURRENCY, WASHINGTON, D.C., OCTOBER 1, 1975 SlRS: Pursuant to the provisions of Section 333 of the United States Revised Statutes, I am pleased to submit the 1974 Annual Report of the Comptroller of the Currency. Respectfully, JAMES E. SMITH, Comptroller of the Currency. THE PRESIDENT OF THE SENATE THE SPEAKER OF THE HOUSE OF REPRESENTATIVES HI Contents Title of Section I. II. III. IV. V. VI. VII. VIII. IX. X. Condition of the National Banking System Income and Expenses of National Banks Structural Changes in the National Banking System Bank Examinations and Related Activities Law Department Fiduciary Activities of National Banks International Banking and Finance Administrative and Management Developments Other Activities Financial Operations of the Office of the Comptroller of the Currency Page 1 3 5 13 15 19 21 23 27 29 Appendices A. B. C. D. Merger Decisions, 1974 Statistical Tables Addresses and Selected Congressional Testimony Selected Rulings and Correspondence of the Comptroller of the Currency Index 35 175 251 299 327 Statistical Tables Table No. 1 2 3 4 5 6 Title Assets, liabilities, and capital accounts of National banks, 1973 and 1974 Income and expenses of National banks, 1973 and 1974 National banks and banking offices, by States, Dec. 31, 1974 Applications for National bank charters, and charters issued, by States, calendar 1974 Applications for National bank charters issued pursuant to corporate reorganizations, and charters issued, by States, calendar 1974 Applications for conversion to National bank charters, and charters issued, by States, calendar 1974 VI Page Table No. 7 2 8 4 9 6 7 10 11 8 12 9 13 Title Branches of National banks, by States, calendar 1974 De novo branch applications of National banks, by States, calendar 1974 De novo branches of National banks opened for business, by community size and by size of bank, calendar 1974 Mergers, calendar 1974 Office of the Comptroller of the Currency: balance sheets Office of the Comptroller of the Currency: statements of revenue, expenses, and Comptroller's equity... Office of the Comptroller of the Currency: statements of changes in financial position Page 1( 1] IS IS 3( 31 31 I. Condition of the National Banking System Recessionary and inflationary factors in the economy during 1974 exerted an important influence on the operations of National banks. In contrast to a 17.8 percent rise in total loans in 1973, the increase registered during 1974 was 9.7 percent. Total securities held, which had grown only 0.9 percent during 1973's strong loan demand, edged upward 2.2 percent in 1974. The major source of new funds for the system during 1974 was a 15.7 percent increase in time and savings deposits, an increase nearly as great as the 16.0 percent figure for 1973. Demand deposits continued to show relatively small increases; 1973's growth rate of 3.8 percent eased to a minuscule 0.8 percent in 1974. In consequence, by the end of 1974, total time and savings deposits accounted for 58.2 percent of total deposits, a proportion that has climbed from 52.0 percent at the end of 1972 and 54.8 percent at the end of 1973. Within the securities category, the 1974 decline of 6.1 percent in Treasuries held was more than offset by increases of 11.4 percent in securities of Government agencies and corporations and of 3.7 percent in municipals. Federal funds purchased and securities sold under agreement to repurchase grew only a nominal 1.0 percent as a source of funds. Among the relatively smaller accounts, acceptances outstanding increased sharply, from $2.9 billion at the end of 1973 to $7.1 billion at year-end 1974. For the second consecutive year, the rate of growth in total assets was less than that of the prior year. At year-end 1974, total assets of National banks reached $534.4 billion, a figure 9.2 percent above the December 1973 amount. The two previous years' rates were 15.5 percent in 1972 and 12.6 percent in 1973. In the composition of National bank assets, the proportion accounted for by loans increased very slightly in 1974, from 55.5 percent to 55.7 percent, while the proportion represented by securities dropped slightly, from 21.4 percent to 20.0 percent. Total reserves on loans rose by 10.5 percent, from $4.6 billion to $5.1 billion, a slightly higher rate of increase than the 9.7 percent shown by total loans. Total capital of National banks reached $35.8 billion at year-end 1974, reflecting an 8.1 percent increase over the prior year figure of $33.1 billion. As in 1973, the capital markets were relatively unreceptive to bank debenture issues during 1974, and the total outstanding only inched upward, from $2.2 billion to $2.3 billion. TABLE 1 Assets, liabilities, and capital accounts of National banks, 1973 and 1974 [Dollar amounts in millions] Amount Change, 1973-1974 Dec. 31, 1974 4,708 banks Dec. 31, 1973 4,661 banks Percent distribution Amount Percent distribution Amount Percent ASSETS Cash and due from banks U.S. Treasury securities Obligations of other U.S. Government agencies and corporations Obligations of States and political subdivisions Other securities Total securities. Federal funds sold and securities purchased under agreements to resell Direct lease financing Loans. Fixed assets Customers' liability on acceptances outstanding . Other assets Total assets . $70,724 14.45 $76,557 14.33 $5,833 30,966 6.32 29,081 5.44 -1,885 15,072 55,236 3,411 3.08 11.28 .70 16,788 57,2% 3,835 3.14 10.72 .72 1,716 2,060 424 104,685 21.38 107,000 20.02 2,315 22,091 1,573 271,572 8,144 2,847 7,965 4.51 .32 55.47 1.66 .58 1.63 23,751 2,426 297,852 9,052 7,037 10,747 4.44 .45 55.73 1.69 1.32 2.02 1,660 853 26,280 908 4,190 2,782 489,600 100.00 534,422 100.00 44,822 136,056 27.79 137,829 25.79 1,773 181,215 6,193 37,072 37.01 1.26 7.57 207,794 2,711 40,206 38.88 .51 7.52 26,579 -3,482 3,134 6,030 23,379 5,935 1.23 4.78 1.21 7,472 29,552 5,662 1.40 5.53 1.06 1,442 6,173 -273 395,881 80.86 431,225 80.69 35,344 179,046 216,835 36.57 44.29 180,391 250,834 33.75 46.94 1,345 33,999 35,975 3,722 7.35 .76 36,323 3,286 6.80 .61 348 -436 2,921 13,251 .60 2.71 7,142 15,424 1.34 2.89 4,221 2,173 451,749 92.27 493,400 92.32 41,651 LIABILITIES Demand deposits of individuals, partnerships and corporations Time and savings deposits of individuals, partnerships and corporations Deposits of U.S. Government Deposits of States and political subdivisions Deposits of foreign governments and official institutions, central banks, and international institutions Deposits of commercial banks Certified and officers' checks, etc Total deposits . Demand deposits Time and savings deposits Federal funds purchased and securities sold under agreements to repurchase Liabilities for borrowed money Acceptances executed by or for account of reporting banks and outstanding Other liabilities Total liabilities Minority interest in consolidated subsidiaries -1 RESERVES ON LOANS AND SECURITIES Reserves on loans Reserves on securities 4,634 79 .95 .02 5,119 70 .96 .01 485 -9 2,200 37 7,904 13,513 8,998 484 .45 .01 1.61 2.76 1.84 .10 2,258 13 8,336 14,067 10,652 503 .42 1.56 2.63 1.99 .09 58 -24 432 554 1,654 19 33,135 6.77 35,830 6.70 2,695 489,600 100.00 534,422 100.00 44,822 CAPITAL ACCOUNTS Capital notes and debentures Preferred stock Common stock Surplus Undivided profits Reserves Total capital accounts Total liabilities and capital accounts NOTE: Data may not add to totals because of rounding. Dashes indicate amounts less than .01 percent. The 1973 and 1974 data reflect consolidation of all majority-owned bank premises subsidiaries, and all significant domestic major owned subsidiaries, with the exception of Edge Act subsidiaries. II. Income and Expenses of National Banks The combination of real growth in the National Banking System and strong inflationary pressures led to steep increases in both total operating income and total operating expense in 1974; 29.6 percent for the former and 34.3 percent for the latter. Those high rates of increase were, however, slightly less than the comparable rates in 1973 of 32.6 percent and 35.9 percent, respectively. The figures for both 1973 and 1974 are in sharp contrast to those of 1972, when operating income rose by 10.5 percent and operating expense by 10.8 percent. Applicable income taxes decreased slightly in 1974 compared to 1973, from $1.2 billion to $1.1 billion. With net security losses totalling $42.4 million in 1974, net income reached $4.0 billion for all National banks, a 7.4 percent increase over 1973. That rate of increase in net income compares with 13.9 percent in 1973 and 8.8 percent in 1972. Since the rate of growth of net income was slightly less than the 9.2 percent rate of growth in total assets, the rate of return on assets fell slightly in 1974 compared to 1973. Interest and fees on loans totalled $28.4 billion in 1974, a 35.0 percent increase over 1973. Loanrelated income accounted for 70.3 percent of total operating income, an increase from the 67.5 percent figure for 1973. Total revenues from securities holdings were $5.6 billion in 1974, an increase over 1973 of 11.6 percent. The proportion of operating income accounted for by income from securities continued to slip, from 16.0 percent in 1973 to 13.8 percent in 1974. As dollar volume of Treasuries held declined for the third straight year, revenues from Federal funds sales and purchases of securities under agreement to resell surpassed revenues from Treasury holdings in 1974, $2.2 billion to $1.8 billion. Revenues from municipals held totalled $2.5 billion, a 13.5 percent increase over 1973, and holdings of securities of agencies and government corporations accounted for $1.0 billion in revenues, an increase of 40.3 percent over 1973. On the expense side, the total cost of funds continued to burgeon, reflecting the growth in the proportion of time deposits to total deposits and evergreater reliance on purchased non-deposit funds. Total interest on deposits reached $16.6 billion, an increase of 42.2 percent over 1973. The proportion of total operating expense accounted for by interest on deposits continued to increase, from 44.5 percent in 1973 to 47.1 percent in 1974. Similarly, the expense of Federal funds purchased and securities sold under agreements to repurchase spurted from $2.7 billion to $4.3 billion, a 59.5 percent increase. As a result, the proportion of operating expense accounted for by the cost of those purchased funds moved from 10.2 percent in 1973 to 12.1 percent in 1974. Salaries and wages of officers and employees increased by 13.6 percent, but the proportion of operating expense represented by salaries and wages continued its decline. The figure has dropped from 23.8 percent in 1971 to 23.1 percent in 1972, to 18.8 percent in 1973, to 15.9 percent in 1974. Occupancy expense has shown a similar decline in relative importance, as the cost of funds has continued to jump upward. Total cash dividends of $1.7 billion were declared by National banks in 1974, a 15.3 percent increase over 1973's $1.4 billion. The 1974 dividends reflected a payout ratio of 41.3 percent. TABLE 2 Income and expenses of National banks*, 1973 and 1974 [Dollair amounts in millions] 1973 Amount Number of banks 4,661 Operating income: Interest and fees on loans $21,054.5 Income on Federal funds sold and securities purchased under agreements to resell 1,454.7 Interest and dividends on investments: U.S. Treasury securities 1,821.8 Obligations of other U.S. Government agencies and corporations 725.7 Obligations of States and political subdivisions... 2,230.8 Other securities 203.7 Trust department income 820.4 Service charges on deposit accounts 752.7 Other service charges, collection and exchange charges, commissions, and fees 815.7 Other operating income 1,334.3 Total operating income Operating expense: Salaries and wages of officers and employees Pensions and other employee benefits Interest on deposits Expense of Federal funds purchased and securities sold under agreements to repurchase Interest on borrowed money Interest on capital notes and debentures Occupancy expense of bank premises, net Furniture and equipment, depreciation, rental costs, servicing, etc Provision for loan losses (or actual net loan losses) . . . Other operating expenses Total operating expense Change, 1973-1974 1974 Percent distribution Amount Amount Percent 47 1.01 70.26 $7,364.1 34.98 Percent distribution 4,708 67.45 $28,418.6 4.66 2,173.1 5.37 718.4 49.38 5.84 1,752.7 4.33 -69.1 -3.79 2.32 7.15 .65 2.63 2.41 1,018.4 2,531.3 258.9 853.7 827.2 2.52 6.26 .64 2.11 2.05 292.7 300.5 55.2 33.3 74.5 40.33 13.47 27.10 4.06 9.90 2.61 4.27 938.5 1,676.0 2.32 4.14 122.8 341.7 15.05 25.61 31,214.2 100.00 40,448.3 100.00 9,234.1 29.58 4,922.0 905.3 11,666.0 18.75 3.45 44.45 5,593.0 1,034.0 16,585.0 15.87 2.94 47.06 671.0 128.7 4,919.0 13.63 14.22 42.17 2,681.2 304.0 130.4 999.2 10.22 1.16 .50 3.81 4,277.2 519.3 147.8 1,146.6 12.14 1.47 .42 3.25 1,596.0 215.3 17.4 147.4 59.53 70.82 13.34 14.75 718.7 758.1 3,161.9 2.74 2.89 12.05 811.9 1,391.8 3,734.9 2.30 3.95 10.60 93.2 633.7 573.0 12.97 83.5S 18.12 26,246.9 100.00 35,241.4 100.00 8,994.5 34.21 Income before income taxes and securities gains or losses Applicable income taxes Income before securities gains or losses Net securities gains (after tax effect) Net income before extraordinary items Extraordinary charges or credits Minority interest in consolidated subsidiaries 4,967.3 1,194.9 3,772.5 -13.5 3,758.9 9.0 5,206.9 1,122.6 4,084.3 -42.4 4,041.9 2.8 239.6 -72.3 311.8 -28.9 283.0 -6.2 4.85 -6.0! 8.2' -214.0' 7.5,' -68.8! Net income 3,767.7 4,044.5 276.8 7.3! Cash dividends declared: On common stock On preferred stock 1,447.0 2.4 1 670 2 1.0 223 2 -1.4 15.4 -58.3 1,449.4 1,671.2- 221.8 15.3 Total cash dividends declared Ratio to income before income taxes and securities: Applicable income taxes Net securities gains Extraordinary charges or credits 24.06 -.27 .18 21.56 -.81 .05 Ratio to total operating income: Salaries and wages Interest on deposits All other operating expenses 15.77 37.37 10.13 13.83 41.00 9.23 84.09 87.13 12.07 10.00 Total operating expenses Met income * Includes all banks operating as National banks at year-end, and full year data for those State banks converting to National ban during the year. NOTE: Dashes indicate amounts of less than $500,000. Data may not add to totals because of rounding. III. Structural Changes in the National Banking System The total number of National banks increased from 4,661 to 4,708 during 1974. Of those, 2,756 were unit banks and the remaining 1,952 operated 15,565 branches at year-end: a grand total of 20,273 National banking offices. The numbers of branches increased during the year by 5.5 percent and the total number of offices by 4.4 percent. Three unit banking states, Texas, Illinois, and Florida, led in total number of National banks with 569, 420, and 282, respectively. The largest number of branches per state are located in California, with 2,662, New York, with 1,544, and Pennsylvania, with 1,320. National banks opened 939 de novo branches in 1974. Mergers and conversions led to the entry into the National Banking System of 246 additional preexisting branches, while 378 branches left the system through closings, mergers, and conversions. Of the 939 de novo branches, 742 or 79 percent, were located in communities with populations of less than 100,000. Only 33, or less than 4 percent, were located in cities with 1 million or more people. Banks with total assets under $100 million established 470 of the de novo branches, or slightly over 50 percent of the total. Billion-dollar banks opened 204 de novo branches, about 22 percent of the total. New York led all states in de novo branches with 130, followed by Pennsylvania with 83 and California with 75. Charters were issued for 92 newly organized National banks during 1974, compared with 94 in 1973. Texas, with 23, and Florida, with 19, were far ahead of other states in the number of new National banks, with third-place Missouri accounting for six. Sixty additional charters were issued pursuant to corporate reorganizations and 12 for banks converting from State systems to the National system. Preliminary approval was granted to 92 de novo charter applications, compared to 134 in 1973. Florida and Texas led all other states, with 21 and 17 respectively, while Illinois ranked third with seven preliminary approvals. During 1974, 66 merger, consolidation or purchase transactions involving two or more operating banks, and in which the resulting bank was a National bank, were completed. In 1973, there were 53 such transactions. In addition, 62 transactions were completed that involved only one operating bank, to effectuate corporate reorganizations. TABLE 3 National banks and banking offices, by States, Dec,31, 1974 National banks Total With branches Unit Number of branches Number of offices United States 4,708 2,756 1,952 15,565 20,273 Alabama Alaska Arizona Arkansas California Colorado Connecticut Delaware District of Columbia Florida 93 5 3 74 55 127 24 5 13 282 36 0 1 20 9 106 3 3 2 257 57 5 2 54 46 21 21 2 11 25 267 65 265 144 2,662 21 251 4 86 25 360 70 268 218 2,717 148 275 9 99 307 Georgia Hawaii Idaho Illinois Indiana Iowa Kansas Kentucky Louisiana Maine 64 2 6 420 121 99 171 80 52 20 17 1 1 326 38 52 129 29 13 4 47 1 5 94 83 47 42 51 39 16 311 10 154 93 441 76 52 192 227 124 375 12 160 513 562 175 223 272 279 144 Maryland Massachusetts Michigan Minnesota Mississippi Missouri Montana Nebraska Nevada New Hampshire 40 78 117 202 39 110 55 121 4 47 8 13 25 189 6 68 52 87 1 16 32 65 92 13 33 42 3 34 3 31 336 492 696 17 212 51 3 45 74 78 376 570 813 219 253 161 58 166 78 125 New Jersey New Mexico New York North Carolina North Dakota . Ohio Oklahoma Oregon Pennsylvania Rhode Island 122 34 154 26 43 217 193 8 250 5 20 5 38 4 28 53 142 1 94 0 102 29 116 22 15 164 51 7 156 5 917 101 1,544 761 16 904 51 289 1,320 113 1,039 135 1,698 787 59 1,121 244 297 1,570 118 South Carolina South Dakota Tennessee Texas Utah Vermont Virginia Washington West Virginia Wisconsin Wyoming Virgin Islands Puerto Rico 18 31 75 569 11 17 109 23 100 128 44 1 1 3 20 13 569 6 5 17 7 89 85 44 0 1 15 11 62 0 5 12 92 16 11 43 0 1 0 289 69 353 0 93 46 625 501 11 81 0 7 0 307 100 428 569 104 63 734 524 111 209 44 8 1 16 2 14 124 140 District of Columbia — all* ... * Includes National and non-National banks in the District of Columbia, all of which are supervised by the Comptroller of the Currency. TABLE 4 Applications for National bank charters*, and charters issued*, by States, calendar 1974 Withdrawn Disapproved Approved Received^ Pending Dec. 31, 1974 United States 313 92 70 Alabama Alaska Arizona Arkansas California Colorado Connecticut Delaware District of Columbia Florida 9 1 0 2 12 8 0 0 1 89 1 1 0 0 4 4 0 0 0 21 2 0 0 1 4 1 0 0 0 28 141 6 0 0 1 4 3 0 0 1 39 Georgia .. Hawaii . . . Idaho . . . . Illinois . . . Indiana .. Iowa Kansas... Kentucky. Louisiana Maine 3 0 0 23 2 0 1 1 3 0 2 0 0 7 0 0 0 0 0 1 0 0 3 0 0 0 0 0 0 0 0 0 13 1 0 1 1 2 0 Maryland Massachusetts .. Michigan Minnesota Mississippi Missouri Montana Nebraska Nevada New Hampshire. 4 1 11 6 4 7 1 1 0 0 3 0 3 1 0 1 0 1 0 0 1 0 0 1 3 1 0 0 0 0 0 0 7 3 1 4 1 0 0 0 New Jersey New Mexico . . . New York North Carolina . North Dakota .. Ohio Oklahoma Oregon Pennsylvania .. Rhode Island .. 10 9 6 1 1 1 3 0 0 0 4 3 2 0 0 0 1 0 0 0 2 4 0 1 0 0 0 0 0 0 2 2 4 0 1 1 1 0 0 0 South Carolina . South Dakota .. Tennessee Texas Utah Vermont Virginia Washington West Virginia .. Wisconsin . . . >. Wyoming Virgin Islands.. Puerto Rico . . . 3 0 3 60 2 0 9 2 2 6 3 0 2 2 0 1 17 0 0 4 2 2 2 2 0 0 0 0 0 * Excludes conversions and corporate reo t Includes 151 applications pending as of itions. ember 31, 1973. 1 11 2 0 3 0 0 0 0 0 1 10 1 0 1 31 0 0 2 0 0 4 1 0 1 Chartered TABLE 5 Applications for National bank charters issued pursuant to corporate reorganizations, and charters issued, by States, calendar 1974 Received* Disapproved Approved United States 65 62 Alabama Alaska Arizona Arkansas California Colorado Connecticut Delaware District of Columbia Florida 6 0 0 1 1 0 0 0 0 0 6 0 0 1 1 0 0 0 0 0 Georgia . . Hawaii . . . Idaho Illinois . . . Indiana . . Iowa . . . . . . Kansas . . . Kentucky. Louisiana Maine 0 0 0 7 0 0 0 1 0 0 0 0 0 7 0 0 0 1 0 0 Maryland Massachusetts .. Michigan Minnesota Mississippi Missouri Montana Nebraska Nevada New Hampshire . 0 6 5 0 1 0 0 0 0 0 0 6 5 0 1 0 0 0 0 0 New Jersey New Mexico . . . New York North Carolina . North Dakota ., Ohio Oklahoma Oregon , Pennsylvania .. Rhode Island .. 1 0 2 0 0 5 2 0 1 0 1 0 2 0 0 5 2 0 1 0 South Carolina . South Dakota .. Tennessee Texas Utah Vermont Virginia Washington West Virginia .. Wisconsin Wyoming Virgin Islands.. Puerto Rico . . . 2 0 1 17 0 0 3 0 2 0 1 0 0 0 0 0 17 0 0 3 0 2 0 1 0 0 : 8 Includes 6 applications pending as of December 31, 1973. Withdrawn Pending Dec. 31, 1974 Chartered TABLE 6 Applications for conversion to National bank charter and charters issued, by States, calendar 1974 Received United States Alabama Alaska Arizona Arkansas California Colorado Connecticut Delaware District of Columbia Florida Georgia Hawaii Idaho Illinois Indiana Iowa Kansas Kentucky Louisiana Maine Maryland Massachusetts Michigan Minnesota Mississippi Missouri Montana Nebraska Nevada New Hampshire New Jersey New Mexico New York North Carolina North Dakota Ohio Oklahoma Oregon Pennsylvania Rhode Island South Carolina South Dakota Tennessee Texas Utah Vermont Virginia Washington West Virginia Wisconsin Wyoming Virgin Islands Approved 13 Disapproved 11 Withdrawn Pending Dec. 31, 1974 Chartered TABLE 7 Branches of National banks by States, calendar 1974 Branches in operation Dec. 31, 1973 United States. De novo branches opened for business Jan. 1 to Dec. 31, 1974 Branches acquired through merger or conversion Jan. 1 to Dec. 31, 1974 Existing branches discontinued or consolidated Jan. 1 to Dec. 31, 1974 378t 939 246 2,603 15 243 4 78 0 23 5 13 27 75 6 12 0 8 25 1 0 0 1 9 0 0 0 0 0 2 0 1 0 25 0 4 0 0 0 Georgia.. Hawaii . . Idaho.... Illinois... Indiana .. Iowa . . . . Kansas .. Kentucky Louisiana Maine . . . 283 10 147 87 408 70 40 174 215 116 30 0 7 8 33 4 11 20 12 8 0 0 0 0 2 4 1 0 0 0 2 0 0 2 2 2 0 2 0 0 Maryland Massachusetts.. Michigan . . . . . . Minnesota Mississippi Missouri Montana . . . Nebraska Nevada New Hampshire 306 473 657 11 182 45 3 32 68 73 20 18 37 6 22 7 0 13 6 4 10 7 8 0 15 0 0 0 0 1 0 6 6 0 7 1 0 0 0 0 New Jersey . . . New Mexico... New York North Carolina North Dakota.. Ohio Oklahoma Oregon Pennsylvania .. Rhode Island .. 857 96 1,518 724 12 856 49 281 1,206 113 39 6 130 41 6 45 3 8 83 0 22 0 24 5 0 3 0 0 93 0 1 1 128 9 2 0 1 0 62 0 South Carolina South Dakota.. Tennessee Texas Utah Vermont Virginia Washington . . . West Virginia . Wisconsin Wyoming Virgin Islands . 345 65 329 0 89 43 578 493 2 77 0 8 21 3 23 0 4 10 36 8 9 4 0 0 12 1 1 0 0 3 18 3 0 2 0 0 89 0 0 0 0 10 7 3 0 2 0 1 0 0 Alabama Alaska Arizona Arkansas California Colorado Connecticut Delaware District of Columbia. Florida District of Columbia - allt 14,758* 245 60 253 116 115 Branches in operation Dec. 31, 1974 * 1973 totals adjusted in New York and Washington. f Includes 1 adjustment made in Michigan. $ Includes National and non-National banks in the District of Columbia, all of which are supervised by the Comptroller of the Currency. 10 TABLE 8 De novo branch applications of National banks, by States, calendar 1974 Approved Received* Withdrawn Disapproved Pending Dec. 31, 1974 42 United States. 1,246 924 Alabama Alaska Arizona Arkansas California Colorado Connecticut Delaware District of Columbia. Florida 26 8 17 22 120 6 9 1 10 64 18 4 12 21 86 5 7 1 6 52 1 0 2 0 18 0 0 0 0 1 7 2 3 1 13 1 1 0 2 7 34 1 7 11 41 4 10 22 19 5 26 1 5 8 28 4 9 17 13 4 1 0 0 0 2 0 0 0 2 0 6 0 0 2 9 0 0 5 4 1 Maryland Massachusetts.. Michigan Minnesota Mississippi Missouri Montana Nebraska Nevada New Hampshire 31 23 123 9 18 15 2 9 3 7 27 19 47 6 16 14 2 8 2 5 2 1 20 0 2 0 0 0 0 0 2 2 49 2 0 0 0 1 1 2 New Jersey . . . New Mexico... New York North Carolina North Dakota.. Ohio Oklahoma Oregon Pennsylvania .. Rhode Island .. 110 9 143 34 8 40 3 15 69 0 74 8 117 30 5 32 2 13 62 0 10 0 9 2 1 2 0 0 1 0 22 1 16 2 2 5 0 2 4 0 South Carolina South Dakota.. Tennessee Texas Jtah /ermont Virginia Washington . . . Vest Virginia . Wisconsin . . . . Wyoming irgin Islands . 'uerto Rico . . . 23 4 26 1 9 2 42 18 5 6 0 0 2 21 3 23 1 7 2 33 10 4 4 0 0 0 2 0 0 0 1 0 5 0 0 1 0 0 2 0 1 2 0 0 0 3 8 0 1 0 0 0 Georgia .. Hawaii .. Idaho Illinois... Indiana .. Iowa Kansas .. Kentucky Louisiana Maine . . . District of Columbia - allt 11 192 0 * Includes 370 applications pending as of December 31, 1973. t Includes National and non-National banks in the District of Columbia, all of which are supervised by the Comptroller of the urrency. n TABLE 9 De novo branches of National banks opened for business, by community size and by size of bank, calendar 1974 Population of cities Less than 5,000 5,000 to 24,999 25,000 to 49,999 50,000 to 99,999 100,000 to 249,999 250,000 to 499,999 500,000 to 1,000,000 Over 1,000,000 Total Total resources of banks (millions of dollars) Branches Branches 34 168 150 118 265 204 Less than 10.0. 10.0 to 24.9 . . . 25.0 to 49.9 . . . 50.0 to 99.9 . . . 100.0 to 999.9 . 1,000 and over. 190 315 134 103 74 40 50 33 939* Total 939* * Includes six automated teller machines beginning operation during 1974. TABLE 10 Mergers,* calendar 1974 Transactions involving two or more operating banks Total 45 5 11 54 0 0 99 5 11 61 54 115 42 7 14 60 0 0 102 7 14 63 60 123 6 1 0 oooo Applications received, 1974: Mergers Consolidations Purchases and Assumptions Others pursuant to corporate reorganization 14 1 0 7 8 15 Consummated, 1974: Mergers Consolidations Purchases and Assumptions 43 8 15 62 0 0 105 8 15 Total consummated 66 62 128 Total received Approvals issued, 1974: Mergers Consolidations Purchases and Assumptions Total decisions Abandoned, 1974: Mergers Consolidations Purchases and Assumptions Total abandoned * Includes mergers, consolidations and purchases and assumptions where the resulting bank is a National bank. 12 IV. Bank Examinations and Related Activities The National Bank Act requires that all National )anks be examined twice in each calendar year, but the Comptroller, in the exercise of his discretion, may waive one such examination in a 2-year period, 3r may cause such examinations to be made more Frequently, if considered necessary. In addition, the District Code authorizes the Comptroller to examine each non-National bank and trust company in the District of Columbia. For the year ended December 31, 1974, the Office examined 6,436 banks, 18,063 branches and facilities, 1,701 trust departments, and 250 affiliates and subsidiaries, as well as conducting 648 special examinations and visitations. In addition, the Office received 221 applications to establish new banks; those included 59 corporate reorganizations. The Office also received 876 applications to establish ie novo branches, and 13 applications to convert State banks to National banking associations. National bank examinations are designed to determine the condition and performance of banks, the quality of their operations, the capacity of management, and whether the banks are complying with federal laws. All facets of an examination have, as heir end result, the determination of liquidity and solvency, present and prospective, and the determilation of whether the bank is operating within the ramework of applicable banking laws and regulaions. The appraisal of a bank's loans and lending olicies, investments and investment policies, and ie ability and capacity of its management constitute ie most exacting phases of the examination proess. As of December 31, 1974, the Office employed 152 examining personnel: 2,009 commercial examers and 143 trust examiners. The Office is constantly trying to improve the lality and efficiency of examinations and this year augurated a comprehensive review of examination actices and procedures. The review is being conicted by a consortium headed by the firm of Hasns and Sells. New examination methods are being rmulated to effectively deal with the changing face of the banking industry. The career development program for examining personnel is placing increased emphasis on various schools for all personnel, from the newly appointed Assistant National Bank Examiner to the experienced National Bank Examiner. The National Bank Examiner's school occupies a key role in that program; it is attended by all recently commissioned National Bank Examiners and is very important in the development of our examining personnel. The curriculum covers all aspects of commercial examinations. Loan and investment analysis, determination of asset quality, and evaluation of bank management receive the greatest emphasis. Time is also devoted to diversification of risk, liquidity, capital adequacy, earnings, bank operations, investment in fixed assets, borrowings, future prospects, and review of the various laws and regulations affecting National banks. There are also lectures on trust and international examining and enforcement responsibilities for various types of consumer legislation. Instruction is provided by Washington Office personnel and several experienced National Bank Examiners. Knowledgeable bankers serve as guest speakers on topics in their fields of specialization. All newly appointed Assistant National Bank Examiners are now assigned to a training crew for 6 months. The training crew is composed of a National Bank Examiner, two experienced Assistant National Bank Examiners and four new employees. The training crew performs examinations of the smaller National banks. Additional examination time is provided so that the new Assistants can be thoroughly trained in all phases of the examination. Assignments are arranged so that each Assistant performs a particular task in several successive examinations in order to assure that he is familiar with the procedure. It is anticipated that that new training approach will result in the Assistant being able to perform most tasks independently after the initial 6 months of training. Following 6 months on a training crew, all newly appointed Assistant National Bank Examiners 13 attend a special school held on the regional level. A new curriculum has been developed for that school, and all phases of the examination are covered with emphasis on those areas of the examination in which the Assistants will be performing most of their work. The material for that school has been improved and is now uniform throughout the country. Instruction is provided by experienced Assistants and commissioned examiners from the region. All training programs of the Office are presently being studied to determine how they can be improved. An additional school is being planned for Senior Assistant National Bank Examiners. A curriculum is being planned that will help the Senior Assistant prepare for his increased responsibilities. Training is a very important part of any organization and increased emphasis is being placed on that area. Ninety-seven National banks with 650 foreign branches require examiners with additional training to examine their international activities. That training is being provided through week-long seminars held quarterly in Washington, D.C., and through frequent, but temporary, international examining assignments at interregional and overseas locations. 14 In 1970, the Office inaugurated a 5-day EDP seminar to be held in the regions and to continue until all examining personnel have received the necessary training. In 1974, the Office conducted 11 of those regional EDP seminars. Instruction covers the capabilities and limitations of EDP systems in commercial banks. In addition, examiners from each region have been selected for specialized instruction in advanced electronic data processing. Those examiners generally work independently of the commercial or trust examiner and prepare the EDP Report of Examination, copies of which are sent to the banks examined. During 1974, a trust school was held in Washington, D.C., in addition to regional schools for trust personnel. Finally, and in keeping with past practices, the Office encourages its examiners to attend the various graduate schools of banking and to participate in the host of courses offered by the American Institute of Banking and Dun and Bradstreet. We will continue to review and update training programs and examining techniques and to keep abreast of the ever-changing world of banking. V. Law Department The Law Department is charged with providing legal counsel to the Comptroller, with interpreting and enforcing banking laws and regulations, and with responding to litigation concerning the Office. Some of the major activities are described below. A. Litigation On January 1, 1974, 42 cases were pending in which the Comptroller was defendant. During the year, 24 of these cases reached disposition: 12 by stipulation of the parties, and 12 upon the merits. Of those cases decided on the merits, a preponderance, 10, represented challenges to the Comptroller's decisions upon new bank charters and branch bank applications. The most significant of these was the decision of the United States Court of Appeals for the Eighth Circuit in First National Bank ofFayetteville v. Smith, 508 F.2d 1371, upholding the Comptroller's arguments as to the limited scope of judicial review of the Comptroller's chartering decisions. None of those cases was decided adversely to the Office. The remaining two cases decided upon the merits litigated issues arising under the Currency and Foreign Transactions Reporting Act. In June 1974, the Supreme Court decided two cases to which the Comptroller was a party involving the Bank Merger Act of 1966. United States v. Marine Bancorporation, 418 U.S. 602; and United States v. Connecticut National Bank, 418 U.S. 656. Each case involved allegations that a merger of two banks would eliminate potential future competition between the banks in violation of §7 of the Clayton Act. The Supreme Court's opinions made clear that the application of potential competition theories to banking must take into account the extensive Federal and State regulatory barriers to entry into banking, and that such barriers make it difficult to invalidate a bank merger on the basis of alleged future potential competition between the merging banks. At year's end, 30 cases were pending, either in trial courts or upon appeal. Of special interest, three pending cases concerned issues springing from the receivership of United States National Bank, San Diego, Calif. B. Enforcement On the administrative side, the procedures of the Financial Institutions Supervisory Act of 1966 were used 20 times to rectify operations and improve administration of National banks. Those proceedings involved written agreements with this Office or orders to cease and desist enforceable through the injunctive powers of United States district courts. Such proceedings commonly involved a coordinated effort among examining personnel, regional authorities, and the Law Department. The Law Department supervised investigation of a large number of suspected bank crimes and the preparation of reports for referral to the several United States Attorneys for possible prosecution. Those referrals represented the full gamut of bankrelated crimes, ranging from common embezzlement to complex, nationwide fraud schemes. C. Securities Disclosure Considerable Law Department activity involved securities laws. The Department reviewed approximately 400 annual reports, 550 proxy statements, 1,100 quarterly reports, 1,000 current reports, and 9,600 ownership reports, filed by banks pursuant to the Securities and Exchange Act of 1934. In addition, numerous registration statements filed with the Securities and Exchange Commission by bank holding companies were reviewed at the SEC's request. In October, the Congress amended Section 12(i) of the 1934 Act, to require that Part 11 of the Comptroller's regulations be rendered substantially similar to the comparable regulations of the Securities and Exchange Commission, or that any divergencies be explained. Accordingly, a survey of National banks was undertaken to determine the contours of trading markets for their shares, preparatory to revising Part 11. The Law Department continued to cooperate with the Securities and Exchange Commission in areas of overlapping jurisdiction or common concern, including questions arising under the Glass-Steagall Act, reorganizations of banks into bank holding com- 15 panies, disclosures, accounting policy, gold sales, automatic investment services for small investors, and financial consulting services for corporate customers. D. Interpretations and Regulations The Law Department received over 2,000 requests from other members of Comptroller's staff, from banks, from attorneys, from bank customers, and from members of Congress for interpretations of banking laws and regulations. Additionally, rulings and circulars were promulgated announcing new policies or revision of standing regulations. The following represents a digest of that activity. L Banking Circular No. 58. By the end of 1974, the ban on private ownership of gold by United States citizens was removed. Since the National Bank Act authorizes National banks to deal in "exchange, coin and bullion," National banks were permitted to participate in the developing market. Banking Circular No. 58, issued in December, 1974, cautioned about the volatility of the gold market, reminded that an investment in gold provides no yield or interest, and discussed insurance needs, accounting procedure, collateralizing loans, amount of inventory, and public relations. 2. Fair Housing Lending Practices Pilot Project. The Comptroller, in conjunction with the Board of Governors of the Federal Reserve System, the Federal Deposit Insurance Corporation, and the Federal Home Loan Bank Board, undertook a Fair Housing Lending Practices Pilot Project, to test the relative effectiveness of three different approaches designed to collect information relating to the directive of the Civil Rights Act of 1968 that no Federally regulated lending institution discriminate on the basis of race, color, religion, sex, or National origin in making residential real estate loans. The pilot project ran from June 1, 1974, to November 30, 1974, in 18 selected Standard Metropolitan Statistical Areas throughout the Nation. Each participating institution was required to request loan applicants to indicate their race and other characteristics, depending on the approach being tested, and to maintain a record of all applications for review by the appropriate regulatory agency. Results of the pilot project are being evaluated, in order to determine the feasibility of a uniform, nation-wide recordkeeping and reporting program. 3. Regulations: a. 12 C.F.R., Part 22—Flood Insurance Regulations. Pursuant to the Flood Disaster Protection Act of 1973, the Comptroller issued regulations (12 C.F.R., Part 22), effective March 2, 16 1974, requiring a National bank to make no loan secured by improved real estate or a mobile home located in a special flood hazard area, unless the borrower purchased flood insurance on the securing property. The regulations further required that a National bank make no such loans after July 1,1975, or 1 year after notification to the community in which the securing property is located that it has been identified by the Secretary of Housing and Urban Development as a special flood hazard area, whichever is later, unless that community is participating in the National Flood Insurance Program. A pamphlet, entitled "Flood Insurance Guidelines," was published by the Comptroller, and distributed to all National banks in an effort to simplify the legal and technical aspects of those regulations. b. 12 C.F.R., Part 23—Statements of Business Interests. The Comptroller added a new Part 23 to Title 12 of the Code of Federal Regulations, to be effective May 1, 1975, requiring directors and principal officers of National banks to maintain on file at the banks, by July 1, 1975, statements of their outside business interests. Those regulations were issued in order to monitor more closely self-dealing transactions which may lead to unsafe and unsound banking practices. Specifically, directors and principal officers must list all business enterprises over which they or their immediate families hold some significant influence, and all transactions between their National bank and those enterprises, which transactions are not evident from the bank's books. Form CC-9030-29 (Rev. 4/75) was designed for compliance with those requirements. 4. Rulings: a. Customer-Bank Communications Terminals (CBCT). On December 12, 1974, the Comptroller announced an interpretation of the National Bank Act stating that National banks could make available, without geographic restriction, foi use by their customers one or more electronic devices or machines, through which an existing banl customer may communicate to the bank a request t< withdraw money either from his account or from < previously authorized line of credit, or an instructioi to receive or transfer funds for the customer' benefit. Examples of such electronic devices o machines are point-of-sale terminals, automati teller machines, and the touch-tone telephone, whe it is possible to use such a telephone to communicat directly with a bank's computer. The interpretiv ruling also stated that use of such devices at locf tions other than the main office or a branch office c the banks does not constitute branch banking Accordingly, National banks were permitted 1 establish such customer-bank communicatio terminals without filing formal applications, provided that prior written notice, including descriptive information with regard to the device or machine prescribed in the ruling, was given to the Comptroller's Office. The ruling imposes few limitations on the establishment and use of CBCT's in order that sellers and users of the service may be given the widest latitude in determining how, when, and where such devices can be used efficiently. In conjunction with the issuance of the ruling, the Comptroller has given public notice that the Office will continually review developments arising from this interpretive ruling, and that he will exercise his regulatory authority to modify the ruling should developments warrant such action. b. Standby Letter of Credit and Ineligible Acceptances. On August 12, 1974, the Office announced the adoption of interpretive rulings on the subject of standby letters of credit and ineligible acceptances. The rulings require that standby letters of credit and ineligible acceptances be treated as ordinary loans for the purpose of statutory limits on loans to a single borrower, and loans to borrowers affiliated with the lending bank. Under the rulings, National banks must disclose, in a footnote to annual financial statements, the aggregate amount of outstanding standby letters of credit. Similar regulations were issued by the Board of Governors of the Federal Reserve System, and the Federal Deposit Insurance Corporation. E. Legislative The Law Department also responded to numerous requests for comments on assistance with various legislative proposals. Prominent among those was the proposed Financial Institutions Act, the legislative proposal based upon recommendations of the President's Commission on Financial Structure and Regulation. The Comptroller strongly supports that legislation. 17 VI. Fiduciary Activities of National Banks Enactment of the Employee Retirement Income Security Act of 1974 had a great impact on trust department administration yet, in 1974, the number of trust departments administered by National banks continued to increase. Fifty-six applications for permits to exercise fiduciary powers were received during the year of which 38, or 68 percent, were approved. Among those were nine conversions from State banks, two of them major, and two de novo trust companies organized as National banks solely to exercise fiduciary powers and administer fiduciary business. It is contemplated that the trust companies will engage in commercial banking business only in connection with the exercise of their fiduciary powers and related activities. A total of four trust companies now operate under such charters. At year-end, trust examining personnel in the 14 National bank regions consisted of 52 Representatives-in-Trusts, eight of whom were commissioned during 1974; 24 Associates-in-Trusts; and 59 Assistant s-in-Trusts, a total of 135. Regulation 9 was amended in 1974 to provide for the collection and public dissemination of information concerning the holdings of and transactions in equity securities held in a fiduciary capacity by National banks and their non-bank subsidiaries or affiliates. Those banks with total equity securities holdings of $75 million or more, as reflected in the Trust Department Annual Report for the preceding year, were requested to file certain information with the Comptroller of the Currency. All holdings over 10,000 shares, their fair market value, and the degree of investment authority and voting control being exercised is to be reported annually. A quarterly report of all purchases or sales of any equity security with a total fair market value of $500,000 or nore, or involving 10,000 shares or more effected luring that quarter is also requested. Those reports ire to be available for public inspection. A further imendment to Regulation 9 is in process with repect to the authorization of variable amount notes. Legislation pertaining to employee benefit plans was enacted by Congress during 1974. The Employee Retirement Income Security Act, the socalled Pension Reform Act, is the most comprehensive and sweeping law concerning the administration of one type of fiduciary activity ever passed by legislators of the United States. Its enforcement in trust departments of National banks will cause examiners to review and re-evaluate employee benefit plans from the standpoint of a new set of rules, some embodying old principles, some completely new. Bank and non-bank fiduciaries alike will have to review and re-evaluate the employee benefit plans they administer, not only because of their duties and responsibilities but also because of the new penalty provisions in the Act. The Comptroller's Manual for Representatives in Trusts is in process of extensive revision, especially on the scope of audits performed in trust departments. It is contemplated that several existing requirements will be modified, particularly to require test-checking instead of 100 percent verification for a number of audit functions. On the other hand, requiring administrative audits of selected accounts as well as the reconcilement of corporate trust issues as a matter of audit procedure are also under consideration. In addition, a program of required minimum standards of output for electronic processing of bookkeeping records is in process of completion and will apply to all National banks. It is anticipated that some former standard bookkeeping requirements, such as the classification of investments by type of assets, will be eliminated in order to make the program realistically minimal. In order to standardize the scope of examination and the manner of reporting on a nationwide basis, questionnaires are being prepared for the trust officer in charge at each bank and for banks' auditors. Another questionnaire is designed for use and application by the examiner in conducting his examination. 19 VII. International Banking and Finance 1974 proved to be a chastening experience for most international bankers. Quadrupled energy costs, inflation, balance of payments deficits, and recycling of OPEC surpluses seemed to be the major challenges when the year began. As months passed, however, massive foreign exchange losses, significant bank failures, and market tiers appeared. Those elements, together, shook confidence in international financial markets, humbling even the most prestigious institutions. Calm was restored slowly as central banks and bank supervisors reacted with lender of last resort policies and with closer controls on lending in foreign exchange activities. The year finished with the international financial system intact and with a more seasoned international banking community. International bankers, during 1974, became reacquainted with the need for effective credit supervision and operating controls. While there is little doubt that certain international banks experienced losses from outright foreign exchange speculation, the problems most institutions encountered arose from speculating with inadequate personnel resources, credit procedures, and operating controls relative to the volume of international activity being conducted. The suddenness of negative events during 1974 caused international banks to contract their exchange and lending business to more moderate levels. At year-end, National banks had reduced their foreign exchange dealings and overall positions. Conservative credit policies were instituted requiring realistic spreads and short-term maturities. Inter-bank activities declined sharply as counerparty analysis became more thorough. Balance of jayment lending ceased as banks narrowed their country exposure limits in recognition of the mountng deficits of most oil importing countries. In the midst of all that activity, National banks ontinued to service their multinational relationships fhile also adjusting their operational strategies. National banks opened 51 foreign branches and losed 21 during 1974. Twenty-two foreign branches rere approved but unopened at year-end. A good eal of that branch activity represented relocations ) the Cayman Islands from the Bahamas, as well as recognition of Tokyo, Singapore, and the Middle East as more important financial areas. Total foreign assets stood at $99.8 billion on December 31, 1974, a 19.8 percent increase over 1973. Forty-eight National banks continued to hold investments in foreign banks or bank-related organizations at year-end. There was a general trend toward investment in OPEC areas during 1974. Many investments were made with OPEC partners. The International Division is charged with the responsibility of supervising those activities. That supervision is effected through examinations of head offices, foreign branches, and foreign affiliates. In addition to reviewing asset quality and internal controls, international examinations place special emphasis on foreign exchange dealings and the accuracy of reports submitted by the foreign units to their head offices. The always sensitive and difficult quality determination of loans to countries is another area of supervision, and one in which the International Division became deeply involved during 1974, as industrial nations and lesser developed countries struggled to adjust to new terms of trade brought about by increased energy costs. During the year, the International Division assigned 96 National bank examiners to 26 countries to conduct routine examinations of 114 foreign branches and/or subsidiaries of National banks. Examinations of four foreign computer functions were also performed. On every assignment, examiners visited with host country banking supervisors for mutually beneficial discussions. In certain cases, our personnel conducted examining seminars for the local central bank examining staff. Such cooperation and communication with foreign bank supervisors is a continuing program for the International Division. During August, approval was granted to increase the International Division's London Embassy staff to six examiners. Those examiners are responsible for supervising the activities of the 23 National banks operating in the United Kingdom, the location of National banks9 largest concentration of foreign assets and foreign exchange activities. During November, the International Division began requiring weekly and monthly foreign exchange reports 21 from National banks active in foreign exchange dealings. The International Division, during 1974, continued to improve its educational and training responsibilities. A weekly newsletter of pertinent and financial media articles now reaches 220 examining personnel, the 14 regional offices, and the staffs of Treasury, the Federal Reserve Board of Governors, and the Congress. During the year, 120 examiners attended quarterly seminars on all aspects of international banking supervision. Thirteen examiners received 1-month foreign exchange training in London. Four examining personnel attended the school for International Banking at the University of 22 Colorado; a Division staff member also instructs ai the school. As in the past, this Office cooperatec fully with the staffs of Congress, the Board of Gov ernors of the Federal Reserve, FDIC, the Bankers Association For Foreign Trade, and the Conference of State Banks Supervisors toward the mutual goa of better banking supervision. Finally, the events o: 1974 have led to the development of an interna tional correspondent relationship among foreigi bank supervisors who now recognize the interde pendence of multinational banking. The Office looks forward to working with its international colleagues in order to maintain confidence in internatioiia banking systems. VIII. Administrative and Management Developments During 1974, Administrative Operations increased ubstantially in breadth and depth to guide impletientation of the Comptroller's many varied pro;rams. The skills required to complete these projcts ranged from coordinating establishment of omplete National headquarters facilities to preparaion of weekly accounts detailing the status of oreign currency transactions from banks having aore than a $1 million net position in any foreign urrency. Such expansive activity was accompanied >y significant changes in the Bureau's administrative rganization. Relocation of the Comptroller's Washington, D.C. >ffices to 490 L'Enfant Plaza East was completed he weekend of September 7-8, 1974. Consolidation it the new headquarters was facilitated by preparaion of an information packet containing a brochure let ailing transportation routes, nearby businesses nd shops, and maps showing the location of offices or all employees. Other items in the packet included elephone listings of fellow employees, directories of hops in L'Enfant Plaza, bus route maps for access :> downtown Washington, and locator cards. Carool assistance was provided where possible. Immeiately after relocation, work was started toward squiring and planning use of additional space on le second and eighth floors to accommodate fore;eable staff expansion. One result of the consolidation of offices has been broadening of administrative responsibilities in the ea of facilities management. An example of such Iministrative involvement in directing facilities use establishment of a complete library whose opera>ns are placed under the supervision of the Dictor, Administrative Operations. The library occues 8,000 feet of core space adjacent to the Law and inking and Economic Research Departments. Cre?d as a research facility, it was designed to house ,000 volumes, most related to banking, economics, d law. Current and past issues of periodicals are salable to readers, who may use them either at nished carrels or in the general reading area. Services offered readers include a microfilm library, microfilm reader printer, a cassette series on bankrelated subjects, and interlibrary loan facilities. Other space management activities carried out during the year included: (1) relocation of regional headquarters offices in Richmond and Denver; (2) preliminary planning for relocation of offices in Chicago and San Francisco; (3) expansion of offices in Portland, Memphis, Minneapolis, and Atlanta; (4) establishment of three additional subregional offices; and, (5) expansion or relocation of others. Procurement activity multiplied due to preparation of the new offices. Procurement officers ordered all equipment used in finishing the space and all furniture and accessories acquired. Efficient management of bank records was assisted by electronic retrieval files obtained for the Records Management Branch. Printing operations were enhanced by the acquisition of advanced equipment including a 24 station collator, double sided printing press, and a 1500 Copy System which makes its own electrostatic plates. Spacious work and storage facilities combined with better machinery improved services of the Supply, Printing & Services Branch. Other branches of the Administrative Operations Division increased both in staff proficiency and equipment sophistication to meet the growing requirements of the Bureau. While there were no major changes made to the financial reporting system during the year, the Fiscal Management Division continued to review its operations and implemented a number of changes to provide more efficient processing of voucher payments. One such change in travel voucher processing substantially reduced keypunch and machine time required to prepare reimbursement checks. A significantly greater volume of vendor payments was processed during 1974. A large part of that increased workload was attributable to the move to new space in Washington. Preliminary discussions began with regard to converting the present EAM accounting system to a 23 computer operation. The computer system will provide more timely and detailed data than are available under the present system. The Bureau's travel regulations are administered by the Fiscal Management Division. During 1974, per diem and mileage allowances were increased after extensive analysis disclosed such increases were warranted to adequately compensate employees. Additionally, the Fiscal Management Division analyzed and reviewed regional requests for additional subregional offices. Establishment of those offices reduced travel costs and permitted examiners to spend less time away from home. The investment portfolio contributed $3.5 million to the Bureau's operating funds in 1974, an increase of 19 percent over the previous year. The interest earned on investments over the past several years by virtue of the policy of keeping all available funds fully invested to maximize interest revenue has contributed substantially to financing the Bureau's operating costs. In late 1974, the Personnel Management Division was reorganized into five branches: employee relations, position management and classification, placement, training, and personnel operations. The reorganization was planned first to provide qualified applicants for positions and to furnish information to assist officials making decisions affecting employees. Second, it was designed to establish a career ladder to facilitate progression of employees into more responsible positions. The reorganization completed, attention was focused on evaluating the existing position classification program to determine improvements required to develop a viable, management-oriented position management classification program. Other improvements in daily operations included more timely service in processing personnel action requests, assurance of compliance with position management objectives prior to undertaking classification actions, assurance position descriptions reflected duties actually performed, and creation of an effective follow-up system of projected positions established to permit expedient recruitment. During 1974, a pilot program based on training crew concepts was devised for Assistant National Bank Examiners and is scheduled for implementation in 1975. The training crew concept involves a 6-month program of planned rotating assignments in various phases of the bank examination process. A second program was initiated to establish on-going training programs for examiners and support staff. 24 A comprehensive supervisory-management training program was developed and implementation set for 1975. The executive development program received special attention as Regional Administrators, department and division heads nominated 32 candidates from a total of 78 applicants. Six employees were selected to participate in the program. At the end of 1974 there were 256 financial interns enrolled in the cooperative education program, a 70 percent increase over 1973. Approximately 35 percent of the financial interns are members of minority groups and 27 percent are women. Increased program activity and intensified examination functions resulted in an increase in the number of examiners and support staff from 2,366 to 2,505. Special progress was made in hiring members of minority groups and women for the examining force. Of a total of 541 minority employees in the regions, 505 are in examination, 278 of whom are women. Evaluations were conducted in six regions to assess the effectiveness of regional personnel management programs. Those evaluations helped resolve individual and regional problems and assisted institution of new practices. The incentive awards program produced 14 awards for adopted suggestions and superior achievements. One hundred thirty-three employees were recognized with high quality increase awards for their superior performance. Awards distributed totalled $75,105 for the year. Changes in laws affecting maternity and annual leave carry-over were implemented during 1974, in addition to pay adjustments for all employees. During the past year, the Management Services Division substantially increased its activities in support of Bureau programs and organizations. That increase in support resulted partly through the utilization of large-scale computers, including an IBM 370/168 and 370/158, and two Univac 1108's. This was accomplished through the installation of both high and low speed remote access terminals. Major systems developed during the year included: (1) bi-monthly reports from all National banks outlining the status of past due loans; (2) quarterly reports from large National banks detailing the schedule of maturities; (3) weekly accounts from banks with a $1 million or more net position in any foreign currency, detailing the status of foreign currency transactions; (4) computer generated mailing lists, labels, and addressed documents; and (5) com- mter-generated microfilm containing National bank eports of condition and income, stored on an inlexed microfilm retrieval system. Interdisciplinary project teams were established o conduct a number of special studies. Among those vas the fair housing lending practices pilot project n which the mortgage lending practices of banks in .8 Standard Metropolitan Statistical Areas were surr eyed. The study was carried out in cooperation vith the Federal Reserve Board, the Federal Deposit nsurance Corporation, and the Federal Home Loan Jank Board. Management analysts investigated the qualities ind disadvantages of various word processing sysems to evaluate the feasibility of utilizing them vithin the Bureau. Other special studies carried out >y the Division included automation of personnel tatistics reporting, evaluation of examination soft- ware, automation of fixed assets inventory and call reports, processing of data on direct lease financing, and development of data base management systems. The staff has been instrumental in Bicentennial planning at both the Bureau and Departmental levels. Throughout 1974 the Division actively supported several on-going programs. Included were management by objectives, emergency planning (including vital records preservation), energy conservation, rechartering and use of advisory committees, maintenance and operation of 53 data processing systems applications, and conduct of functional and procedural reviews. In order to provide more comprehensive support to the Bureau, the Division was restructured into four operating entities: systems and programming; data operations; management analysis; and technical analysis. 25 IX. Other Activities In September, 1974, a Strategic Policy Planning Group was established at the National Office. The new unit reports directly to the Comptroller. Broadly defined, its mission is to assist the Comptroller and his senior associates in strategic policy planning. One of the principle objectives of this unit is to track the developing financial functions of the larger National banks. Such a mission requires individuals in the Group with expertise in such key functional areas as liability management, financial analysis, electronic funds transfers, leasing and so on. The Group is expected to play a major role in identifying problem areas and developing conditions which require attention of the Office. In recognition of growing consumer awareness in this country, the Comptroller of the Currency announced the establishment of the Consumer Affairs Division in March 1974. The Division became operational in September 1974, when the Office moved into new quarters. Concern has been expressed in Congress and by public interest groups that bank regulatory agencies have not always given bank customers the same consideration they give banks. It was to alleviate that concern and to coordinate the activities that this Office has traditionally undertaken on behalf of consumers that the Comptroller created the Division. 1974 was very significant in the area of consumer legislation. This Office, for the past few years, has been involved in the enforcement of the Truth-inLending and Fair Credit Reporting acts, which have had direct bearing and considerable impact on protecting consumers' interests. The Federal thrust of such legislation was expanded with the enactment of the Fair Credit Billing Act, the Equal Credit Opportunity Act, the Federal Trade Commission Improvement Act, and the Real Estate Settlement Procedures Act. The first two of those new acts become effective October 28, 1975. The first provides for the correction of billing errors and protects the customer from the creditor during the procedural process, and the second forbids a creditor from discriminating against any applicant on the basis of sex or marital status. Interestingly, the latter act is not limited to consumer credit, but applies to all credit. The third piece of legislation, the Improvement Act, attempts to provide sanctions against unfair or deceptive acts or practices by banks. For the first time, banks have been made subject to the prohibitions contained in the Federal Trade Commission Act. The term "unfair or deceptive acts or practices" is broad and flexible and as yet there is no determination as to how this will be applied to the banking industry. The Real Estate Settlement Procedures Act becomes effective June 20, 1975, and will provide reforms in the complex real estate settlement process. Its basic thrust is that customers are provided with greater and more timely information regarding settlement costs. National bank examiners continue to be trained to administer, enforce, and interpret consumer laws and regulations as they apply to banks and their customers. The various complaints lodged against National banks because of their consumer activity are investigated by the Division, as well as by the regional offices. Current and proposed consumer banking practices are studied to determine if they contain abuses. The Consumer Affairs Division has maintained close contact with State banking commissioners, other Federal regulatory agencies, and consumer interest groups in order that there might be an interchange of ideas and mutual assistance in the field of banking consumer protection. The Department of Banking and Economic Research, coupled with the Statistics Division, has oversight responsibility for most of the data sources currently available to the Office, except for examination reports. Those sources include the Report of Condition and the Report of Income, the basic interagency statistical reports submitted by all insured banks. Other report series include the Bank Liquidity Analysis form, initiated on a quarterly basis in December 1966 and modified from time to time since then; trust department annual reports and common 27 trust fund annual reports; the Maturity Schedule of Assets and Liabilities; and the Past-Due Loans Report. In addition, one-time surveys are conducted as required, such as the comprehensive leasing survey of 1974. The Maturity Schedule of Assets and Liabilities was developed during 1974 with the aid of valuable advice from other staff members and from the banking industry. The 200-plus largest National banks completed that report for the first time as of October 31, and the plan is to collect those data every 3 months. The basic approach of the Schedule is to secure a multiperiod maturity breakdown for each asset and liability account for which the concept of 28 maturity has meaning. A large number of ratios have been computed from the Schedule data, and reporting banks are receiving summary information allowing them to compare their positions with that of fellow respondents. The Past-Due Loans report was also developed during 1974, with November 30 the first report date. That report, which secures the ratios of past-due loans to total loans for four loan categories, is being submitted by all National banks every 2 months. Indispensable programming and processing support has been provided for all these reporting systems by the Management Services Division. X. Financial Operations of the Office of the Comptroller of the Currency Total revenue for the year was $56.8 million, an increase of 10.86 percent over 1973. However, that represents a decrease of 3.2 percent when compared to the 14.06 percent revenue growth rate experienced in 1973. Assessment receipts, which account for 86 percent of total revenue, amounted to $48.7 million, an increase of $5.6 million. That resulted from a $54.7 billion rise in National bank assets. National bank assets affecting 1974 assessment receipts rose 12.57 percent, compared to an increase of 15.54 percent in the previous year. Thus, the decline in bank asset growth was the prime factor in the decrease in total revenue growth. Revenue from trust examinations totaled $2,585,000, an increase of $83,000. There were approximately 1,630 trust examinations made in 1974, compared to 1,668 in 1973. Revenue from branch investigation applications was down sharply, decreasing $237,000. Eight hundred and thirty-nine branch applications were received in 1974, compared to 1,284 in 1973. Revenue from new bank charter and merger and consolidation fees decreased by $206,000 and $86,000, respectively. There were 216 new bank charter applications in 1974, compared to 299 in 1973, and the number of bank merger applications dropped to 110, compared to 142 in 1973. Revenue from the sale of bank examination reports decreased $291,000, owing to a reduction in the charge made for such reports provided to the Federal Reserve. Interest on investments increased $544,000, a rise of 19 percent, for a total of $3,481,000. That rise was due to combination of a larger amount of funds available for investment and a full year's revenue from higher interest bearing securities acquired in the latter part of 1973. The other revenue categories remained at substantially the same levels when compared to 1973. Total expenses amounted to $55.5 million, compared to $45.8 million for 1973, an increase of $9.7 million. That amounts to a 21.14 percent increase for 1974, compared to 13.20 percent for 1973. Salaries, personnel benefits and travel expenses amounted to $50.1 million, or 90.3 percent of the total expenses for the year. Those three expenses amounted to $43.3 million in 1973. Salary increases were caused by (1) a full year under the governmentwide general pay increase of 4.77 percent, effective October 1973, and another general pay increase of 5.5 percent, effective October 1974, (2) a 3-month retroactive pay increase for October 1972 to January 1973, resulting from a judicial decision in 1974, and (3) an increase in our examining staff and support personnel. Travel expenses totaled $8.1 million, a rise of $1.6 million over 1973. That rise was caused by higher per diem and mileage allowances as well as the increase in the examining staff. The remaining expenses totaled $5.4 million, an increase of $2.8 million over the previous year. The most significant increases occurred in rent, consultants, education, remodeling and moving, and shipping. The increase in rent results from leasing commercial space for the purpose of consolidating the Washington staff at one location and from rent payments for previously rent-free space in government buildings. Remodeling and moving and shipping costs were also up because of the moves to commercial space. Another factor in the rise in moving and shipping was the increased costs associated with employee transfers. Consulting services were up because of the study of examination procedures by a consulting firm and the increased use of consultants in other matters. The equity account is, in reality, a reserve for contingencies. Transfers of $1.3 million increased the equity to $33.7 million at year-end. That represents a 6.3 months' reserve for operating expenses, based on the level of expenses over the last 3 months of 1974. The equity account has been administratively restricted in the amount of $2.0 million as explained in Note 2 of the financial statements. 29 TABLE 11 OFFICE OF THE COMPTROLLER OF THE CURRENCY BALANCE SHEETS December 31 Assets Current assets: Cash Obligations of U.S. Government, at amortized cost (approximates market value) Accrued interest on investments Accounts receivable Travel advances Prepaid expenses and other assets Total current assets Long-term obligations of U.S. Government, at amortized cost (approximates market value) Fixed assets and leasehold improvements, at cost (Note 1): Furniture and fixtures Office machinery and equipment Leasehold improvements Less accumulated depreciation and amortization Total assets 1974 $121,237 8,970,646 699,359 252,243 536,885 198,552 1973 $1,620,642 3,749,000 738,230 245,010 483,440 105,329 10,778,922 6,941,651 27,069,661 33,256,668 1,632,599 645,857 2,655,248 886,466 509,110 4,933,704 1,395,576 719,026 798,609 4,214,678 596,967 $42,063,261 $40,795,286 $923,858 178,650 1,636,130 $343,459 155,372 2,604,320 2,738,638 3,103,151 2,917,160 2,706,932 2,581,794 2,706,492 8,362,730 8,391,437 2,000,000 31,700,531 32,403,849 Liabilities and Comptroller's Equity Current liabilities: Accounts payable and accrued expenses Taxes and other payroll deductions Accrued travel and salaries Total current liabilities Long-term liabilities: Accumulated annual leave Closed Receivership Funds (Note 2) Total liabilities Comptroller's equity: Administratively restricted (Note 2) Unrestricted Total liabilities and Comptroller's equity See Notes at end of section. 30 33,700,531 32,403,849 $42,063,261 $40,795,286 TABLE 12 OFFICE OF THE COMPTROLLER OF THE CURRENCY STATEMENTS OF REVENUE, EXPENSES AND COMPTROLLER'S EQUITY Year ended December 31 1974 1973 Revenue (Note 1): Semiannual assessments Examinations and investigations Investment income Examination reports sold Other $48,749,470 4,271,273 3,481,139 216,279 83,998 $43,178,771 4,520,905 2,936,677 507,080 92,353 56,802,159 51,235,786 Expenses: Salaries Retirement and other employee benefits (Note 3) Per diem Travel Rent and maintenance (Note 3) Communications Moving and shipping Employee education and training Printing, reproduction and subscriptions Office machine repairs and rentals Depreciation and amortization Supplies Consulting services Conferences Remodeling Other 38,550,745 3,493,216 5,244,786 2,861,221 1,522,938 567,172 548,531 401,686 355,609 193,866 228,139 182,602 841,122 152,328 147,426 214,090 33,985,944 2,854,360 4,195,473 2,263,484 629,907 495,468 181,498 244,917 256,977 155,204 121,418 111,890 128,590 37,954 20,248 134,844 Excess of revenue over expenses Comptroller's equity at beginning of year 55,505,477 1,296,682 32,403,849 45,818,176 5,417,610 26,986,239 $33,700,531 $32,403,849 Comptroller's equity at end of year See Notes at end of section. 31 TABLE 13 OFFICE OF THE COMPTROLLER OF THE CURRENCY STATEMENTS OF CHANGES IN FINANCIAL POSITION Year ended December 31 1974 1973 Financial resources were provided by: Excess of revenue over expenses Add charges and credits not affecting working capital in the period: Additions to accumulated annual leave Depreciation and amortization Amortization of premium and accretion of discount on long-term U.S. Government, obligations (net) Net (gain) loss on sale of fixed assets Working capital provided by operations for the period Long-term U.S. Government obligations transferred to current assets Proceeds received from sales of fixed assets Net Closed Receivership Funds' receipts Total Financial resources were used for: Purchases of long-term U.S. Government obligations Payments of accrued annual leave Purchase of furniture, fixtures, machinery and equipment Purchase of leasehold improvements Total $1,296,682 $5,417,610 592,548 228,139 666,850 121,418 (4,340) (18,326) (5,753) 2,613 2,094,703 9,188,347 119,794 440 6,202,738 1,350,000 9,971 134 11,403,284 7,562,843 2,997,000 257,182 1,292,070 2,655,248 12,932,950 293,202 137,863 7,201,500 13,364,015 Increase (decrease) in working capital $4,201,784 $(5,801,172) Analysis of Changes in Working Capital Increase (decrease) in current assets: Cash Obligations of U.S. Government Accrued interest Accounts receivable Travel advances Prepaid expenses and other assets $(1,499,405) 5,221,646 (38,871) 7,233 53,445 93,223 $1,457,879 (5,340,412) 175,943 (254,129) 47,623 30,507 3,837,271 (3,882,589) Decrease (increase) in current liabilities: Accounts payable and other accruals Taxes and other payroll deductions Accrued travel and salaries Increase (decrease) in working capital See Notes at end of section. 32 (580,399) (23,278) 968,190 (150,265) (21,836) (1,746,482) 364,513 (1,918,583) $4,201,784 $(5,801,172) OPINION OF INDEPENDENT ACCOUNTANT To the Comptroller of the Currency Office of the Comptroller of the Currency In our opinion, the accompanying balance sheets, the related statements of revenue, expenses and Comptroller's equity and the statements of changes in financial position present fairly the financial position of the Office of the Comptroller of the Currency at December 31, 1974 and 1973, the results of its operations and the changes in financial position for the years then ended, in conformity with generally accepted accounting principles consistently applied. Our examinations of these statements were made in accordance with generally accepted auditing standards and accordingly included such tests of the accounting records and such other auditing procedures as we considered necessary in the circumstances, including confirmation of securities owned by correspondence with the depositary. PRICE WATERHOUSE & CO. WASHINGTON, D.C. April 15, 1975. 33 NOTES TO FINANCIAL STATEMENTS Note 1 — Organization and Accounting Policies The Office of the Comptroller of the Currency was created for the purpose of establishing and regulating a National Banking System. The National Currency Act of 1863, rewritten and reenacted as the National Banking Act of 1864, created the Comptroller's Office, provided for its supervisory functions and the chartering of banks. The revenue of the Comptroller's Office is derived principally from assessments and fees paid by the National banks and interest on investments in U.S. Government obligations. Assessments paid by National banks are not construed to be government funds. No funds derived from taxes or federal appropriations are allocated to or used by the Comptroller's Office in any of its operations. However, since the Comptroller's Office was created by an Act of Congress, its operations are not subject to federal income taxes. The accounts of the Comptroller's Office are maintained on the accrual basis. Furniture, fixtures, office machinery and equipment are depreciated on the straight-line basis principally over an estimated useful life of 10 years. Leasehold improvements are amortized over the terms of the related leases (including renewal options) or the estimated useful lives, whichever is less* Premiums and discounts on investments in U.S. Government obligations are amortized or accreted ratably over the terms of the obligations. U.S. Government obligations having a maturity date more than 12 months from the date of the financial statements are classified as long-term investments. Note 2 - Closed Receivership Funds Prior to the assumption of closed National bank receivership functions by the Federal Deposit Insurance Corporation in 1936, the Comptroller of the Currency appointed individual receivers for all closed National banks. After settling the affairs of the closed banks and issuing final distributions to the creditors of the banks, principally depositors, the receivers transfered to the custody of the Comptroller's Office all remaining funds which represented distributions which were undeliverable or had not been presented for payment. Closed Receivership Funds in the accompanying balance sheets represent the potential claims for such funds by the original creditors of the receiverships. Since inception of the receivership function, unclaimed funds have been invested in U.S. Government securities. The income from investments has been applied as an offset to expenses incurred by the Comptroller's Office in performing this function and accordingly has been recorded as revenue in its statements of revenue expenses and Comptroller's equity. Through December 31, 1974, income has exceeded direct expenses by approximately $2,000,000 (including $155,000 and $156,000 in 1974 and 1973, respectively), which excess amount is included in the Comptroller's equity. An analysis of allocable indirect expenses has not been made. In a recent reexamination of the legal status of Closed Receivership Funds and related excess income earned thereon, the 34 Comptroller's legal staff has been unable to locate any definitive statutory or case law which specifies the ultimate disposition of such funds. In the absence of legal precedent, the legal staff is unable to currently give a definitive opinion as to the appropriate disposition of either the unclaimed receivership funds or the excess income from investment of such funds. Accordingly, the Comptroller intends to seek legislative resolution of those matters. Pending a resolution of the legal uncertainties surrounding those funds, the Comptroller's Office has continued to include a liability for Closed Receivership Funds in its balance sheet and continued to recognize income from investment of such funds as revenue in its statements of revenue, expenses, and Comptroller's equity. However, in recognition of those uncertainties, the Comptroller has administratively restricted a portion of the Comptroller's equity in an amount that approximates the excess income earned from investment of Closed Receivership Funds since custody of the funds commenced. Note 3 - Commitments and Contingencies Regional and sub-regional offices of the Comptroller of the Currency lease office space under agreements which expire at varying dates through 1984. In addition, the Comptroller's Office occupied new office space in Washington, D.C. during 1974 under a lease agreement providing for an initial 5-year term with five consecutive 5-year renewal options. The options provide for renegotiation of the rental at each renewal. Prior to July 1, 1974, the Washington, D.C. office and certain regional offices, located in Federal Government facilities were occupied on a rentfree basis. Minimum rental commitments under 80 leases in effect at December 31, 1974 aggregate approximately $1,800,000 for 1975 and varying lesser amounts each year thereafter, to approximately $1,400,000 for 1979 and insignificant amounts thereafter through 1984. The Comptroller's Office contributes to the Civil Service Retirement plan for the benefit of all its eligible employees. Contributions aggregated $2,628,454 and $2,311,708 in 1974 and 1973, respectively. The plan is participatory, with 7 percent of salary being contributed by each party. The accompanying balance sheets include a liability for annual leave, accumulated within specified limits, which if not taken by employees prior to retirement is paid at that date. Various banks in the District of Columbia have deposited securities with the Comptroller's Office as collateral for those banks entering into and administering trust activities. Those securities, having a par or stated value of $11,991,000, are not assets of the Comptroller's Office and, accordingly, are not included in the accompanying financial statements. The Comptroller is a defendant, together with other bank supervisory agencies and other persons, in litigation generally related to the closing of certain National banks in 1974 and 1973. In the opinion of the Comptroller's legal staff, the Comptroller will be able to defend successfully against those complaints and no liability to the Comptroller is expected to result therefrom. APPENDIX A Merger Decisions, 1974 Merger* Decisions, 1974 /. Mergers consummated, involving two or more operating banks Jan. 1, 1974: Page First National Bank and Trust Company, Ontario, Calif. Palm Springs National Bank, Palm Springs, Calif. 43 Merger Jan. 1, 1974: The United National Bank & Trust Company, Canton, Ohio Beach City Banking Company, Beach City, Ohio 44 Merger Jan. 2, 1974: United Virginia Bank/First & Citizens National, Alexandria, Va. United Virginia Zirginia Bank of Fairfax, Vienna (Fairfax Count nty), r)9 Va. Consolidation. 45 Jan. 4, 1974: Maryland National Bank, Baltimore, Md. Sykesville State Bank, Sykesville, Md. 46 Merger Jan. 22, 1974: Wells Fargo Bank, National Association, San Francisco, Calif. Beverly Hills National Bank, Beverly Hills, Calif. 47 Purchase Feb. 11, 1974: The Shelby National Bank of Shelbyville, Shelbyville, Ind. The Union State Bank, Morristown, Ind. 48 Purchase Feb. 26, 1974: People's National Bank of Georgetown, Georgetown, Ohio Citizens Bank Co., Hamersville, Ohio 49 Purchase Feb. 28, 1974: The American National Bank in Battle Creek, Battle Creek, Mich. The Athens Branch of The American National Bank and Trust Company of Michigan, Kalamazoo, Mich. 50 Purchase Mar. 1, 1974: First National Bank of Monroe County, Aberdeen, Miss. Peoples Bank, Starkville, Miss. 51 Consolidation Mar. 29, 1974: The First National Bank of Hancock, Hancock, N.Y. The First National Bank of Hamden, Hamden, N.Y. 52 Purchase Mar. 31, 1974: Midlantic National Bank, Newark, N.J. Millburn-Short Hills Bank, Millburn, N.J. 53 Merger Mar. 31, 1974: Midlantic National Bank/Morris, Morristown, N.J. Midlantic National Bank/Parsippany, ParsippanyTroy Hills, N.J. 54 Merger * Includes mergers, consolidations, and purchase and sale transactions where the emerging bank is a National bank. Decisions are arranged chronologically by effective date. Page Apr. 1, 1974: Dominion National Bank, Baileys Cross Roads, Va. Peoples Bank and Trust Company of Fairfax, Fairfax County, Va. 55 Merger Apr. 1, 1974: The First National Bank of Versailles, Versailles, Ohio The Peoples Bank Company, Versailles, Ohio 56 Consolidation Apr. 11, 1974: Maryland National Bank, Baltimore, Md. Eutaw Savings Bank of Baltimore, Baltimore, Md. 59 Purchase Apr. 12, 1974: The Baraboo National Bank, Baraboo, Wis. Farmers State Bank, Rock Springs, Wis. 59 Purchase Apr. 22, 1974: Bankers Trust of South Carolina, N.A., Columbia, S.C. The Peoples Bank, Beaufort, S.C. 60 Merger Apr. 30, 1974: The First National Bank of Jasper, Jasper, Ala. Dora Banking and Trust Company, Dora, Ala. 61 Consolidation Apr. 30, 1974: The Peoples National Bank and Trust Company of Washington, Washington, Ind. Farmers State Bank, Plainville, Ind. 62 Merger May 1, 1974: Fidelity National Bank, Halifax County, Va. The Halifax Branch of The Fidelity National Bank, Lynchburg, Va. 63 Purchase May 10, 1974: The Fulton National Bank of Lancaster, Lancaster, Pa. The Hummelstown National Bank, Hummelstown, Pa. 64 Merger May 17, 1974: North Carolina National Bank, Charlotte, N.C. The First National Bank of Mount Airy, Mount Airy, N.C. 65 Merger May 17, 1974: The St. Lawrence National Bank, Canton, N.Y. Lewis County Trust Company, Lowville, N.Y. 66 Merger May 31, 1974: Pennsylvania National Bank and Trust Company, Pottsville, Pa. The Dime Bank of Lansford, Lansford, Pa. 67 Merger May 31, 1974: Peoples National Bank of Monmouth County, Hazlet Township, N.J. Madison State Bank, Madison Township, N.J. 68 Merger May 31, 1974: The National Bank of Jackson, Jackson, Mich. Farmers State Bank of Concord, Concord, Mich. 69 Merger 37 June 7, 1974: Page First National Bank of Ocean County, Lakewood, N.J. First National State Bank of the Jersey Coast, Spring Lake, N.J. Merger 70 June 10, 1974: The National Bank of South Carolina of Sumter, Sumter, S.C. The Farmers Bank, Loris, S.C. Merger 71 June 10, 1974: The Wyoming National Bank of Wilkes-Barre, WilkesBarre, Pa. The First National Bank of Factoryville, Factoryville, Pa. Merger 72 June 28, 1974: Deposit Guaranty National Bank, Jackson, Miss. Leflore Bank & Trust Company, Greenwood, Miss. Merger 73 June 28, 1974: The National Bank and Trust Company of Norwich, Norwich, N.Y. The National Bank of Hobart, Hobart, N.Y. Merger 74 July 1, 1974: Republic National Bank of New York, New York, N.Y. Kings Lafayette Bank, New York, N.Y. Republic Bank, National Association, New York, N.Y. Merger 75 July 1, 1974: The Okey-Vernon National Bank of Corning, Corning, Iowa First State Bank, Prescott, Iowa Purchase 77 July 15, 1974: The First National Bank of the City of Superior, Superior, Wis. Wisconsin State Bank, Superior, Wis. Purchase 78 July 29, 1974: First National Bank of Somerset County, Berlin, Pa. The First National Bank of Confluence, Confluence, Pa. Consolidation 79 July 31, 1974: The First National Bank of San Jose, San Jose, Calif. Hayward National Bank, Hayward, Calif. Merger 80 Aug. 2, 1974: The First Jersey National Bank, Jersey City, N.J. Belmar-Wall National Bank, Wall Township, N.J. Merger 81 Aug. 16, 1974: The County Bank, N.A., Cambridge, Mass. Lexington Trust Company, Lexington, Mass. Consolidation 82 Aug. 23, 1974: Wells Fargo Bank, National Association, San Francisco, Calif. Commercial National Bank, Orange County (P.O. Buena Park), Calif. Merger 83 Sept. 16, 1974: The Toy National Bank of Sioux City, Sioux City, Iowa Farmers Loan & Trust Company, Sioux City, Iowa Merger 84 Sept. 28, 1974: Michigan National Bank of Macomb, Warren, Mich. Tri-City Bank, Warren, Mich. Purchase 85 Sept. 30, 1974: Cumberland County National Bank and Trust Company, New Cumberland, Pa. The Duncannon National Bank, Duncannon, Pa. Merger 86 38 Oct. 1, 1974: Page First National Bank of Aberdeen, Aberdeen, S. Dak. The First National Bank in Bristol, Bristol, S.Dak. Merger 87 Oct. 1, 1974: National Bank of Mississippi, Starkville, Miss. The National Bank of Commerce of Columbus, Columbus, Miss. Consolidation 88 Oct. 29, 1974: Citizens Bank of Marlton, National Association, Marlton, N.J. Citizens State Bank, Vineland, N.J. Citizens National Bank of South Jersey, Bridgeton, Bridgeton, N.J. Continental Bank of New Jersey, Maple Shade, N.J. Merger 89 Oct. 31, 1974: Citizens First National Bank of New Jersey, Ridgewood, N.J. Oakland State Bank, Oakland, N.J. Merger 91 Oct. 31, 1974: New Jersey Bank (National Association), Clifton, N.J. Fairneld National Bank, Fairfield, N.J. Merger Nov. 14, 1974: First Mississippi National Bank, Hattiesburg, Miss. Citizens National Bank, Jackson, Miss. Purchase Nov. 15, 1974: Pittsburgh National Bank, Jeanette, Pa. Blairsville National Bank, Blairsville, Pa. Purchase Nov. 15, 1974: The First National Bank of Eastern Pennsylvania, Wilkes-Barre, Pa. The Berwick National Bank, Berwick, Pa. Merger Nov. 18, 1974: National Bank of the Commonwealth, Indiana, Pa. The Houtzdale Bank, Houtzdale, Pa. Purchase Nov. 29, 1974: Bankers Trust Company of Albany, National Association, Albany, N.Y. The First National Bank of Cooperstown, Cooperstown, N.Y. Merger Nov. 29, 1974: Indian Head National Bank of Nashua, Nashua, N.H. Indian Head National Bank of Manchester, Manchester, N.H. Consolidation Nov. 29, 1974: Mechanics National Bank of Delaware Valley, Burlington Township, N.J. Egg Harbor Bank and Trust Company, Egg Harbor City, N.J. Merger Nov. 29, 1974: Security National Bank of Kansas City, Kansas City, Kans. The Victory State Bank, Kansas City, Kans. Merger Nov. 29, 1974: Vermont National Bank, Brattleboro, Vt. Montpelier National Bank, Montpelier, Vt. Merger Dec. 2, 1974: Old National Bank of Washington, Spokane, Wash. Guaranty National Bank of White Center, Seattle, Wash. Purchase Dec. 2, 1974: Third National Bank of New Jersey, Camden, N.J. United Jersey National Bank of Cherry Hill, Cherry Hill, N.J. Merger 92 93 93 94 95 96 97 98 100 101 102 103 Dec. 21, 1974: Harrison County National Bank, Hopedale, Ohio The Freeport State Bank, Freeport, Ohio Merger Dec. 30, 1974: First National Bank of Springfield, Springfield, Vt. The First National Bank of Fair Haven, Fair Haven, Vt. The Northfield National Bank, Northfield, Vt. Merger Dec. 30, 1974: New Jersey Bank (National Association), Clifton, N.J. The First National Bank of Westwood, Westwood, Page 104 105 N.J. Merger Dec. 30, 1974: Wachovia Bank and Trust Company, N.A., WinstonSalem, N.C. Citizens Bank, Marshall, N.C. Merger 106 Dec. 31, 1974: First National Bank of South Carolina, Columbia, S.C. Palmetto Bank & Trust Company, Lake City, S.C. Merger Dec. 31, 1974: First National Bank of South Carolina, Columbia, S.C. The Bank of Walterboro, Walterboro, S.C. Merger Dec. 31, 1974: The Central Trust Company of Montgomery County, National Association, Dayton, Ohio The Farmers and Merchants Bank of Englewood, Englewood, Ohio Merger Dec. 31, 1974: The National Bank of Richmond, Richmond, Mich. New Haven Savings Bank, New Haven, Mich. Merger Page 109 HO HI 112 107 //. Mergers consummated, pursuant to corporate reorganization Jan. 1, 1974: Page The Farmers National Bank of Salem, Salem, Ohio Northern Columbiana County National Bank, Salem, Ohio Merger 114 Jan. 2, 1974: Fidelity Bank, National Association, Oklahoma City, Okla. Fidelity National Bank, Oklahoma City, Okla. Merger 115 Jan. 2, 1974: The First National Bank of Cincinnati, Cincinnati, Ohio FN National Bank, Cincinnati, Ohio Merger 115 Jan. 18, 1974: First National Bank in Grand Prairie, Grand Prairie, Tex. Second National Bank in Grand Prairie, Grand Prairie, Tex. Merger 116 Jan. 18, 1974: Texas National Bank of Dallas, Dallas, Tex. Stemmons National Bank, Dallas, Tex. Merger 117 Jan. 28, 1974: Hamilton National Bank of Loudon, Loudon, Tenn. Loudon Bank, N.A., Loudon, Tenn. Merger 118 Jan. 28, 1974: The Farmers Bank of Winchester, Winchester, Tenn. Winchester Bank, N.A., Winchester, Tenn. Merger 119 Feb. 1, 1974: The First National Bank in Onancock, Onancock, Va. Onancock Bank, N.A., Onancock, Va. Merger 119 Feb. 4, 1974: The Homer National Bank, Homer, N.Y. Homer Bank, N.A., Homer, N.Y. Merger 120 Feb. 28, 1974: National Bank and Trust Company of Ann Arbor, Ann Arbor, Mich. National Bank of Ann Arbor, Ann Arbor, Mich. Merger 121 Feb. 28, 1974: National Bank of Murfreesboro, Murfreesboro, Tenn. The Second National Bank of Murfreesboro, Murfreesboro, Tenn. Merger 122 Feb. 28, 1974: Page The First National Bank of Canton, Canton, N.Y. Chase Manhattan Bank of Northern New York (National Association), Canton, N.Y. Merger 123 Mar. 8, 1974: First National Bank of Lake City, Lake City, Mich. LCM National Bank, Lake City, Mich. Merger 124 Mar. 8, 1974: National Bank of Rochester, Rochester, Mich. NBR National Bank, Rochester, Mich. Merger 125 Mar. 18, 1974: The First National Bank of Crockett, Crockett, Tex. The New National Bank of Crockett, Crockett, Tex. Merger 126 Mar. 27, 1974: The Selma National Bank, Selma, Ala. Selma Bank, N.A., Selma, Ala. Merger 127 Mar. 29, 1974: First National Bank of Athens, Athens, Ala. First Bank of Athens, N.A., Athens, Ala. Merger 128 Mar. 29, 1974: The First National Bank of Hancock, Hancock, N.Y. Hancock National Bank, Hancock, N. Y. Merger 129 Apr. 1, 1974: The First National Bank of Nordheim, Nordheim, Tex. The New National Bank of Nordheim, Nordheim, Tex. Merger 130 Apr. 29, 1974: First National Bank in Aspen, Aspen, Colo. Second National Bank in Aspen, Aspen, Colo. Merger 130 Apr. 29, 1974: The First National Bank of Glenwood Springs, Glenwood Springs, Colo. Second National Bank in Glenwood Springs, Glenwood Springs, Colo. Merger 131 Apr. 29, 1974: First National Bank in Grand Junction, Grand Junction, Colo. Second National Bank in Grand Junction, Grand Junction, Colo. Merger 132 39 Apr. 29, 1974: Page First National Bank-North in Grand Junction, Grand Junction, Colo. Second National Bank-North, Grand Junction, Grand Junction, Colo. Merger 133 Apr. 30, 1974: Concord National Bank, Concord, N.H. The Concord Bank, National Association, Concord, N.H. Merger 134 Apr. 30, 1974: Laconia Peoples National Bank & Trust Company, Laconia, N.H. The Laconia Bank, National Association, Laconia, N.H. Merger 135 Apr. 30, 1974: The City National Bank of Selma, Selma, Ala. Dallas County National Bank, Selma, Ala. Merger 136 Apr. 30, 1974: The Merchants National Bank of Manchester, Manchester, N.H. The Merchants Bank, National Association, Manchester, N.H. Merger 137 May 8, 1974: The First National Bank of Sault Ste. Marie, Sault Ste. Marie, Mich. Sault National Bank, Sault Ste. Marie, Mich. Merger 138 May 9, 1974: Old & Third National Bank of Union City, Union City, Tenn. The National Bank of Union City, Union City, Tenn. Merger 139 May 9, 1974: Republic National Bank of Dallas, Dallas, Tex. Ervay Bank, National Association, Dallas, Tex. Merger 140 May 10, 1974: The First National Bank of New Bedford, New Bedford, Mass. Second National Bank of New Bedford, New Bedford, Mass. Merger 140 May 20, 1974: The Union National Bank and Trust Company of Marquette, Marquette, Mich. UNB National Bank, Marquette, Mich. Merger 141 May 31, 1974: Baldwin National Bank of Robertsdale, Robertsdale, Ala. Gulf Coast National Bank of Robertsdale, Robertsdale, Ala. Merger 142 May 31, 1974: Delaware Valley National Bank, Cherry Hill, N.J. New Jersey National Bank-South, Cherry Hill, N.J. Merger 143 June 4, 1974: First Safety Fund National Bank, Fitchburg, Mass. Montachusett National Bank, Fitchburg, Mass. Merger 144 June 28, 1974: Colonial First National Bank, Red Bank, N.J. New Colonial First National Bank, Red Bank, N.J. Merger 145 June 28, 1974: Glen National Bank and Trust Company, Watkins Glen, N.Y. Bank of Watkins Glen, National Association, Watkins Glen, N.Y. Merger 146 40 June 28, 1974: Page The First National Bank of Easthampton, Easthampton, Mass. Easthampton Bank (National Associaton), Easthampton, Mass. Merger 147 June 30, 1974: The First National Bank of Cranbury, Cranbury, N.J. Midlantic National Bank/Cranbury, Cranbury, N.J. Merger 148 July 1, 1974: First National Bank & Trust Company in Alton, Alton, 111. First National Bank & Trust Company, Alton, 111. Merger 149 July 1, 1974: Seattle-First National Bank, Seattle, Wash. SeaFirst National Bank, Seattle, Wash. Merger 149 July 8, 1974: The First National Bank of Maryland, Baltimore, Md. Charles Street National Bank, Baltimore, Md. Merger 150 July 18, 1974: The Cleveland National Bank, Cleveland, Tenn. Cleveland Interim Bank, N.A., Cleveland, Tenn. Merger 151 July 26, 1974: Guaranty National Bank and Trust of Corpus Christi, Corpus Christi, Tex. Guaranty Commerce National Bank, Corpus Christi, Tex. Merger 152 Aug. 1, 1974: The Prospect Park National Bank, Wayne, N.J. First Prospect Park National Bank, Wayne, N.J. Merger 153 Aug. 2, 1974: First National Bank of Hurst, Hurst, Tex. Hurst Commerce National Bank, Hurst, Tex. Merger 154 Aug. 7, 1974: First City National Bank of Gadsden, Gadsden, Ala. Bank of Gadsden, N.A., Gadsden, Ala. Merger 155 Aug. 19, 1974: Lafayette National Bank, Lafayette, Ind. Tippecanoe National Bank, Lafayette, Ind. Merger 156 Aug. 26, 1974: Farmers-First National Bank of Stephenville, Stephenville, Tex. Stephen ville National Bank, Stephen ville, Tex. Merger 157 Aug. 30, 1974: Plaza National Bank, Secaucus, N.J. Second Plaza National Bank, Secaucus, N.J. Merger 158 Sept. 16, 1974: The Athens National Bank, Athens, Ohio The F.B.G. National Bank of Athens, Athens, Ohio Merger 159 Sept. 30, 1974: The Citizens Baughman National Bank, Sidney, Ohio The C.B. National Bank of Sidney, Sidney, Ohio Merger 160 Oct. 10, 1974: The First National Bank of Evart, Evart, Mich. Evart Bank, N.A., Evart, Mich. Merger 161 Oct. 31, 1974: The Colonial-American National Bank of Roanoke, Roanoke, Va. Colonial Bank, N.A., Roanoke, Va. Merger 162 Nov. 1, 1974: The First National Bank in Cleburne, Cleburne, Tex. Johnson County National Bank, Cleburne, Tex. Merger Nov. 14, 1974: Phenix National Bank, Phenix City, Ala. Bank of Phenix, N.A., Phenix City, Ala. Merger Nov. 18, 1974: Virginia National Bank/Fairfax, Springfield, Va. Community Bank and Trust Company, Springfield, Va. Merger Dec. 9, 1974: Central Bank, National Association, Grand Rapids, Mich. C. Bank, National Association, Grand Rapids, Mich. Merger Page 162 163 164 165 Dec. 9, 1974: Page Valley National Bank of S agin aw, Saginaw, Mich. V. National Bank, Saginaw, Mich. Merger 166 Dec. 13, 1974: The Gogebic National Bank of Ironwood, Ironwood, Mich. GNB National Bank, Ironwood, Mich. Merger 167 Dec. 30, 1974: First National Bank of Ironwood, Ironwood, Mich. The Second National Bank of Ironwood, Ironwood, Mich. Merger 168 Dec. 31, 1974: National Bank of Commerce of Pine Bluff, Pine Bluff, Ark. Jefferson National Bank, Pine Bluff, Ark. Merger 169 777. Additional Approvals A. Approved, but abandoned, no ligitation Page May 8, 1974: The First National Bank of Paris, Paris, Tex. New National Bank of Paris, Paris, Tex. Merger 170 May 8, 1974: The First National Bank of San Angelo, San Angelo, Tex. New National Bank, San Angelo, Tex. Merger 171 Nov. 12, 1974: First Mississippi National Bank, Hattiesburg, Miss. Citizens National Bank, Jackson, Miss. Merger 172 B. Approved, but abandoned, due to litigation Page July 9, 1974: The Merchants National Bank of Burlington, Burlington, Vt. Montpelier National Bank, Montpelier, Vt. Merger 173 Aug. 22, 1974: The Connecticut National Bank, Bridgeport, Conn. The First New Haven National Bank, New Haven, Conn. Consolidation 173 Oct. 3, 1974: The National Bank of Commerce of Seattle, Seattle, Wash. Washington Trust Bank, Spokane, Wash. Merger 173 41 /. Mergers consummated, involving two or more operating banks FIRST NATIONAL BANK AND TRUST COMPANY, ONTARIO, CALIF., AND PALM SPRINGS NATIONAL BANK, PALM SPRINGS, CALIF. Banking offices Total assets Name of bank and type of transaction In operation Palm Springs National Bank, Palm Springs, Calif. (15276), with and First National Bank and Trust Company, Ontario, Calif. (6268), which had merged Jan. 1, 1974, under charter and title of the latter bank (6268). The merged bank at date of merger had COMPTROLLER S DECISION On May 17, 1973, Palm Springs National Bank, Palm Springs, Calif., and First National Bank and Trust Company, Ontario, Calif., applied to the Comptroller of the Currency for permission to merge under the charter and with the title of the latter. First National Bank and Trust Company, the charter bank, was organized in 1887, and possesses total assets of $113.9 million and IPC deposits of $84.6 million. It is headquartered in Ontario, Calif., and operates 14 branch offices in San Bernardino and Riverside counties. It has received authorization to establish two additional branches in the cities of Upland and Riverside. The service area of the charter bank encompasses the "West End" of San Bernardino County and the western portion of Riverside County. That area, which has a population of approximately 350,000 people, is economically dependent on industry and agriculture. Competitors for the charter bank include Bank of America National Trust and Savings Association, with deposits of $33.3 billion; Security Pacific National Bank, with deposits of $10 billion; and Crocker National Bank, with deposits of $6.2 billion. Palm Springs National Bank, the merging bank, was organized in 1964, and has total assets of $24.2 million and IPC deposits of $19.9 million. Headquartered in Palm Springs, it operates five branches in Riverside County and has received approval to open another branch in Palm Springs. The merging bank has been beset by management and asset problems. The merging bank's service area is the central portion of Riverside County around Palm Springs. The population of that area is approximately 130,000, and the economy is based on agriculture, recreation, and retirement facilities. Palm Springs National Bank competes with Bank of America National Trust and Savings Association, Security $ 24,710,462 128,773,855 To be operated 6 15 153,484,317 21 Pacific National Bank, United California Bank, Crocker National Bank, City National Bank, with deposits of $498 million, and First National Bank in Coachella, with deposits of $8.8 million. Competition between the subject banks is virtually nonexistent as their closest offices are separated by a distance of 30 miles. Consummation of the proposed merger will enhance rather than diminish competition. Expanded and improved services such as trust services, electronic data processing, and an increased lending limit, will be offered by the resulting bank. In addition, the management and loss problems of the merging bank will be resolved. Applying the statutory criteria, it is the conclusion of this Office that the proposed merger is in the public interest and will result in no adverse competitive effects. The application is, therefore, approved. OCTOBER 10, 1973. SUMMARY OF REPORT BY ATTORNEY GENERAL First National Bank and Trust Company of Ontario ("Ontario Bank") operates 16 banking offices in San Bernadino and Riverside counties in Southern California. As of March 31, 1973, Ontario Bank held total deposits of $103.6 million (including IPC demand deposits of $34.5 million) and total loans of $57 million. Palm Springs National Bank ("Palm Springs Bank") operates six banking offices in Palm Springs and nearby communities in Central Riverside County. An additional branch in Palm Springs has been approved but has not been opened. As of March 31, 1973, Palm Springs Bank held total deposits of $22.3 million (including IPC demand deposits of $10 million) and total loans of $13 million. Although Palm Springs Bank has enjoyed substantial growth since its formation in 1964, it has recently experienced substantial operating losses. 43 The parties to this merger are headquartered about 70 miles apart, and the nearest offices are located about 25 miles apart with the San Jacinto Mountains situated in the intervening area. It appears that the proposed transaction would eliminate no substantial existing competition. Nor, because of the relatively modest size of the bank to be acquirec and the existence of other significant potential en trants, does it appear that the proposed merger wil eliminate substantial potential competition. Therefore, we conclude that the proposed transac tion will not have a substantial competitive impact THE UNITED NATIONAL BANK & TRUST COMPANY, CANTON, OHIO, AND BEACH CITY BANKING COMPANY, BEACH CITY, OHIO Banking offices Name of bank and type of transaction Total assets In operation Beach City Banking Company, Beach City, Ohio, with and The United National Bank & Trust Company, Canton, Ohio (14501), which had merged Jan. 1, 1974, under charter and title of the latter bank (14501). The merged bank at date of merger had COMPTROLLER'S DECISION On June 15, 1973, Beach City Banking Company, Beach City, Ohio, and The United National Bank & Trust Company, Canton, Ohio, applied to the Comptroller of the Currency for permission to merge under the charter and with the title of the latter. The United National Bank & Trust Company, the charter bank, was organized in September 1972 by the merger of Canton National Bank, Canton, Ohio, organized in 1854, and Mount Union Bank, Alliance, Ohio, organized in 1930. The bank, with assets of $93 million and IPC deposits of $73.9 million, is headquartered in Stark County, Ohio, and through seven branches, serves Canton, Plain Township, Jackson Township, and Alliance. The charter bank is the fourth largest of five banks headquartered in Canton and also the fourth largest of the 13 banks in Stark County. Competition for the charter bank is provided by The Harter Bank and Trust Company, Canton, with deposits of $242 million; First National Bank of Canton, with deposits of $177 million; and Peoples-Merchants Trust Company, Canton, with deposits of $120 million. Beach City Banking Company, the merging bank, was chartered in 1898 and, with assets of $10 million and IPC deposits of $8 million, has operated as a unit bank since its inception. The active management of this bank is supervised by its president, who is 72 years old. There is, at present, no middle level management personnel who can take control of the daily functions of the bank when the president retires. Beach City is located in the extreme southwest corner of Stark County. 44 $ 10,286,299 100,413,248 109,383,244 To be operated 1 8 9 Beach City Banking Company is the 10th largest of the 13 commercial banks in Stark County. Competition for this bank comes from the Brewster branch office of Peoples-Merchant Trust Company, which has total deposits of $120 million, and from Navarre Deposit Bank Company, with deposits of $8.8 million. The primary service area of the merging bank is limited to Beach City, with a population of 1,151, and its immediate environs including Sugar Creek Township and a small portion of both Tuscarawas County and Holmes County. That area is almost entirely devoted to small farms and has no other significant employers. Many residents of this area commute to Canton, Dover, or other cities for employment. The service area of the charter bank is central and northeast Stark County including Canton, its environs, and Alliance. Canton's economy is concentrated in the basic steel and fabricated metal fields and in machine production. Competition between The United National Bank & Trust Company and Beach City Banking Company is insignificant. The main office of the charter bank is 16 miles from Beach City and the charter bank's nearest branch is 15 miles from the merging bank. Those distances, and the numerous financial institutions located in the intervening area, confirm that very little competition exists between the charter and merging banks. Consummation of the proposed merger will stimulate competition in the service area of the merging bank. The resulting bank will offer improved and expanded services to the residents of Beach City including a larger lending limit, expansion of lending ervices, and the introduction of trust services, ^hile the merger will solve the problem of managenent succession at Beach City Banking Company, he resulting bank will neither increase its ranking imong competing banks nor will it significantly increase its position among other commercial banks operating in Stark County. Applying the statutory criteria, it is concluded that the proposed merger is in the public interest. The application is, therefore, approved. NOVEMBER 29, 1973. SUMMARY OF REPORT BY ATTORNEY GENERAL Union National Bank and Trust Company ("Union Bank") operates its head office and seven branches in and around Canton in Stark County, Ohio. On June 30, 1972, Union Bank held total deposits of $80.9 million (including IPC demand deposits of $24.5 million) and had total loans outstanding of approximately $51 million. Beach City Banking Company ("Beach City Bank") operates its only office in Beach City, Stark County, Ohio. On June 30, 1972, Beach City Bank held total deposits of $8.2 million (including IPC demand deposits of $1.3 million) and had total loans outstanding of approximately $5.2 million. Though both Union Bank and Beach City Bank operate in Stark County, Ohio, their nearest offices are about 16 miles apart, with several other banking offices intervening. Thus, while the proposed transaction may eliminate a limited amount of existing competition, it does not appear that banking concentration would be substantially increased in any relevant market. Therefore, we conclude that the proposed acquisition would not have a substantial competitive impact. UNITED VIRGINIA BANK/FIRST & CITIZENS NATIONAL, ALEXANDRIA, VA., AND UNITED VIRGINIA BANK OF FAIRFAX, VIENNA (FAIRFAX COUNTY), VA. Banking offices Total assets Name of bank and type of transaction In operation United Virginia Bank of Fairfax, Vienna (Fairfax County), Va., with and United Virginia Bank/First & Citizens National, Alexandria, Va. (651), which had consolidated Jan. 2, 1974, under charter of the latter bank (651) and title "United Virginia Bank/ National." The consolidated bank at date of consolidation had COMPTROLLER'S DECISION On June 5, 1973, United Virginia Bank/First & Citizens National, Alexandria, Va., and United Virginia Bank of Fairfax, Vienna (Fairfax County), Va., applied to the Comptroller of the Currency for permission to consolidate under the charter of the former and with the title "United Virginia Bank/ National," with headquarters in Vienna, Va. United Virginia Bank/First & Citizens National, the charter bank, was organized in 1864 and, with assets of $266 million and IPC deposits of $216.7 million, operates 20 offices and has 6 approved but unopened branches. Its service area includes the city of Alexandria and adjacent sections of Arlington and Fairfax counties. United Virginia Bank of Fairfax, Vienna, Va., the consolidating bank, was chartered in 1929 and, with assets of $99.5 million and IPC deposits of $73.2 million, operates 10 offices in Fairfax County, its service area. $108,584,051 302,480,978 411,065,029 To be operated 10 22 32 While both banks serve adjacent areas in Northern Virginia, there is very little competition between the banks. The Alexandria bank can legally branch no more than 5 miles into Fairfax County and has no office closer than 5 miles from an office of the Fairfax bank. Furthermore, both the charter and consolidating banks are wholly-owned subsidiaries of United Virginia Bankshares, Inc., a registered bank holding company and the proposed transaction is, therefore, a corporate reorganization and will have no effect on competition. Consummation of the consolidation will allow an improvement in operating and administrative efficiencies and provide a larger lending limit for customers. Applying the statutory criteria, it is the conclusion of this Office that the proposed consolidation will result in no adverse competitive effects and will benefit the public interest. This application is, therefore, approved. NOVEMBER 30, 1973. 45 SUMMARY OF REPORT BY ATTORNEY GENERAL Both of the consolidating banks are essentially wholly-owned subsidiaries of United Virginia Bank- shares, Inc., a registered bank holding company. Thus, the proposed transaction is essentially a corporate reorganization and will have no effect on competition. MARYLAND NATIONAL BANK, BALTIMORE, MD., AND SYKESVILLE STATE BANK, SYKESVILLE, MD. Banking offices Name of bank and type of transaction Total assets $ 14,481,227 Sykesville State Bank, Sykesville, Md., with 1,732,138,222 and Maryland National Bank, Baltimore, Md. (13745), which had merged Jan. 4, 1974, under charter and title of the latter bank (13745). The merged bank at date 1,745,392,289 of merger had COMPTROLLER S DECISION On September 24, 1973, Maryland National Bank, Baltimore, Md., and Sykesville State Bank, Sykesville, Md., applied to the Comptroller of the Currency for permission to merge under the charter and with the title of the former. Maryland National Bank, the charter bank, was organized in 1933 and now, with assets of $1.6 billion and IPC deposits of $1 billion, is the largest commercial bank in Maryland. The charter bank operates 118 banking offices throughout the State, 56 of which serve the Baltimore Metropolitan Area. Since 1969, Maryland National Bank has been the principal subsidiary of Maryland National Corporation, a one-bank holding company headquartered in Baltimore. The retail service area of the charter bank includes portions of the Eastern Shore, Harford County, western Maryland, Montgomery and Prince Georges counties, southern Maryland, and metropolitan Baltimore. The bank's specialized departments enable it to compete on a statewide basis for large commercial customers and National concerns. In Maryland, competition for the charter bank is provided by Equitable Bancorporation, whose four subsidiary banks have aggregate deposits of $986 million; The First National Bank of Maryland, Baltimore, with deposits of $802 million; Suburban Trust Company, Hyattsville, with deposits of $684 million; and Union Trust Company of Maryland, with deposits of $611 million. Sykesville State Bank, the merging bank, was chartered in 1934, and is now the sixth in deposit size of banks headquartered in Carroll County and 64th of the 114 commercial banks in the State of Maryland. The merging bank has assets of $14.4 46 In To be operation operated 3 120 123 million and IPC deposits of $12.5 million and operates two branches, one each in Eldersburg and Friendship. Both of those branches are within 4 miles of the bank's main office. The service area of the merging bank consists of the southern portion of Carroll County and the northern portion of adjoining Howard County where its Friendship branch is situated. The economy of that area is traditionally primarily agricultural but is now becoming more industrialized. The only direct competition in the area is provided by the Eldersburg branch of The Woodline National Bank, which has total deposits of $8.7 million. Carroll County Bank and Trust Company, Westminister, with deposits of $65 million, has, however, received permission to open a new branch office in Eldersburg. Competition between the charter and merging banks is nominal because of the distance which separates their closest two offices. The branches of the charter bank nearest to those of the merging bank are in Randalls town and O wings Mills which are 11 miles and 13 miles northeast of Sykesville, in Baltimore County. Maryland National Bank does not operate any branches in Carroll County. Consummation of the proposed merger will allow the resulting branches in Carroll County to provide new and improved services to customers in its service area, particularly in the areas of business financing, accounts receivable financing, and international banking. Because of the small size of the merging bank, this merger will not significantly affect the statewide size of Maryland National Bank. Applying the statutory criteria, it is concluded that the proposed merger is in the public interest and this application is, therefore, approved. NOVEMBER 30, 1973. SUMMARY OF REPORT BY ATTORNEY GENERAL The nearest offices of the parties are separated by a distance of approximately 9 miles with five competitive alternatives in the intervening area. Although the proposed acquisition will eliminate some existing competition, it does not appear that banking concentration would be substantially increased in any relevant banking market. While Maryland Na- tional Bank could expand de novo into the communities presently served by State Bank, the latter's relatively small absolute size and the nature of the communities which it serves diminish the effect of this transaction on potential competition. Therefore, we conclude that this proposed acquisition would not have a substantial competitive impact. WELLS FARGO BANK, NATIONAL ASSOCIATION, SAN FRANCISCO, CALIF., AND BEVERLY HILLS NATIONAL BANK, BEVERLY HILLS, CALIF. Banking offices Name of bank and type of transaction Total assets In operation Beverly Hills National Bank, Beverly Hills, Calif. (13348), with was purchased Jan. 22, 1974, by Wells Fargo Bank, National Association, San Francisco, Calif. (15660), which had After the purchase was effected, the receiving bank had COMPTROLLER'S DECISION On January 22, 1974, application was made to the Comptroller of the Currency for permission for Wells Fargo Bank, National Association, San Francisco, Calif., to purchase certain of the assets and assume certain of the liabilities of Beverly Hills National Bank, Beverly Hills, Calif. Wells Fargo Bank, National Association, also applied pursuant to 12 U.S.C. 36(c) to establish branches at the banking locations now occupied by Beverly Hills National Bank. In accordance with the provisions of 12 U.S.C. 181 and 12 U.S.C. 1828(c), it is found that an emergency exists and that this Office must act immediately to prevent the probable failure of Beverly Hills National Bank, Beverly Hills, Calif., and to protect its depositors, creditors, and shareholders. Accordingly, approval by the shareholders of Beverly Hills National Bank of the Agreement to As- % 140,714,528 3 10,658,110,142 9,013,936,840 305 To be operated 308 sume Liabilities and to Acquire Assets executed between Wells Fargo Bank, National Association, and Beverly Hills National Bank is hereby waived; the purchase of certain assets and assumption of certain liabilities as contemplated by that Agreement is approved; and Wells Fargo Bank, National Association, is authorized to consummate the transaction immediately. Wells Fargo Bank, National Association, is hereby given permission to establish and operate branches at 9600 Santa Monica Boulevard, Beverly Hills, Calif.; 9101 Wilshire Boulevard, Beverly Hills, Calif.; and at 143 Barrington Place, Los Angeles, Calif. JANUARY 22, 1974. NOTE: Due to the emergency nature of the situation, no report on competitive factors was requested. 47 THE SHELBY NATIONAL BANK OF SHELBYVHLLE, SHELBYVILLE, IND., AND THE UNION STATE BANK, MORRISTOWN, IND. Banking offices Total assets Name of bank and type of transaction In operation The Union State Bank, Morristown, Ind., with was purchased Feb. 11, 1974, by The Shelby National Bank of Shelbyville, Shelbyville, Ind. (7946), which had After the purchase was effected, the receiving bank had COMPTROLLER'S DECISION On September 20, 1973, The Shelby National Bank of Shelbyville, Shelbyville, Ind., applied to the Comptroller of the Currency for permission to purchase the assets and assume the liabilities of The Union State Bank, Morristown, Ind. The Shelby National Bank of Shelbyville, the purchasing bank, was organized in 1955 and operates two branch offices. With total assets of $41.2 million and IPC deposits of $33.5 million, the bank is the largest bank operating in Shelby County. The service area of the purchasing bank encompasses Addison Township, an industrial area which has a population of approximately 18,000 people. Competitors of the purchasing bank include Farmers National Bank, with deposits of $28.3 million; The State Bank of Waldron, with deposits of $11.4 million; and Fairland National Bank, with deposits of $11.3 million. The Union State Bank, the selling bank, was organized in 1894, and operates as a unit institution. With total assets of $4 million and IPC deposits $3.2 million, it is the smallest bank in Shelby County. The service area of the bank encompasses Hanover Township, an agricultural area which has a population of approximately 2,350 people. Competitors of the selling bank include The Greenfield Banking Company, with deposits of $37.9 million; Rushville National Bank, with deposits of $25 million; and Hancock County Bank, with deposits of $19 million. Competition between the subject banks is minimal because they are separated by a distance of 48 To be operated $ 4,208,362 45,215,863 47,339,182 approximately 19 miles and because an inconvenient highway system exists between them. Consummation of the proposed transaction will result in no significant adverse competitive effects. The resulting bank will better serve the Morristown area by offering an increased lending limit and by the influx of a more aggressive managerial staff. Applying the statutory criteria, it is the opinion of this Office that the proposed transaction is in the public interest and will result in no adverse competitive effects. This application is, therefore, approved. JANUARY 10, 1974. SUMMARY OF REPORT BY ATTORNEY GENERAL Both Shelby Bank and Union Bank operate in Shelby County, Ind., with their nearest offices separated by a distance of about 13 miles. There are no competitive alternatives in the intervening area. Thus, it appears that the proposed acquisition may eliminate some existing competition. Commercial banking in Shelby County is highly concentrated. Shelby Bank, with approximately 41 percent of county deposits, ranks first among the county's five banks, while the three largest banks hold approximately 84 percent of total county deposits. The proposed acquisition will increase Shelby Bank's share of the Shelby County market to 45 percent and increase the share of the top three banks from 84 percent to 88 percent. The proposed transaction would eliminate some existing competition and increase banking concentration in Shelby County. PEOPLE'S NATIONAL BANK OF GEORGETOWN, GEORGETOWN, OHIO, AND CITIZENS BANK CO., HAMERSVILLE, OHIO Banking offices Total assets Name of bank and type of transaction In operation Citizens Bank Co., Hamersville, Ohio, with was purchased Feb. 26, 1974, by The People's National Bank of Georgetown, Georgetown, Ohio (5996), which had After the purchase was effected, the receiving bank had COMPTROLLER'S DECISION On August 23, 1973, The People's National Bank of Georgetown, Georgetown, Ohio, applied to the Comptroller of the Currency for permission to purchase the assets and assume the liabilities of the Citizens Bank Co., Hamersville, Ohio. The People's National Bank of Georgetown, the applicant, was organized in 1901 and operates as a unit institution. It possesses total assets of $8.1 million and IPC deposits of $6.2 million. The service area of the applicant, which, with an estimated population of 7,500 people, is agricultural in nature, encompasses the area surrounding Georgetown. Competitors for the applicant include The Bank of Russellville, with deposits of $18.9 million; The Citizens National Bank of Ripley, with deposits of $6.5 million; The First National Bank of Georgetown, with deposits of $6.4 million; and The Ripley National Bank, with deposits of $6 million. Citizens Bank Co., the selling bank, was organized in 1906 and operates as a unit institution. With total assets of $2 million and IPC deposits of $1.8 million, it is the smallest bank in Brown County. Its service area encompasses Hamersville and its environs, an area with a population of 2,500 people which is economically dependent on agriculture. The only significant competitor of the selling bank is The First National Bank of Bethel in Clermont County, which has deposits of $4.4 million. The selling bank is unable to compete effectively with the larger banks in Brown County because of its small size, inadequate lending limit, lack of service, and ineffective management. Consequently, even though the service areas of the subject banks do overlap, competition between them is minimal. In fact, most of the applicant's business in the Hamersville area is generated from loans which the selling $ 2,123,355 1 9,388,332 10,826,132 1 To be operated 2 bank is too small to accommodate and which it refers to the applicant. In addition, the applicant is already furnishing personnel to assist the selling bank in its daily operations; an interlocking directorate relationship exists between the two banks; and they have a number of common shareholders. Consummation of the proposed transaction will result in no adverse competitive effects. Competition in the Hamersville area will be increased through the introduction by the resulting bank of new and expanded services such as an increased lending capacity, money orders, travelers checks, a night depository, Christmas and vacation club accounts, drive-up window facilities, and the monthly mailing of checking account statements. In addition, the Hamersville office will be operated by experienced banking personnel. Applying the statutory criteria, it is the opinion of this Office that the proposed transaction is in the public interest and will result in no adverse competitive effects. This application is, therefore, approved. JANUARY 21, 1974. SUMMARY OF REPORT BY ATTORNEY GENERAL People's Bank and Citizens Bank are located about 10 miles apart with several competing banking offices in the intervening area. It appears that the proposed acquisition would eliminate only a limited amount of existing competition. And in view of the modest size of the parties and the existence of other potential entrants into their respective markets, we conclude that the proposed transaction would not eliminate substantial potential competition. Therefore, we conclude that the proposed transaction would not have a substantial competitive impact. 49 THE AMERICAN NATIONAL BANK IN BATTLE CREEK, BATTLE CREEK, MICH., AND THE ATHENS BRANCH OF THE AMERICAN NATIONAL BANK AND TRUST COMPANY OF MICHIGAN, KALAMAZOO, MICH. Banking offices Name of bank and type of transaction Total assets In operation The Athens Branch of The American National Bank and Trust Company of Michigan, Kalamazoo, Mich. (13820), with was purchased Feb. 28, 1974, by The American National Bank in Battle Creek, Battle Creek, Mich. (16185), which had After the purchase was effected, the receiving bank had COMPTROLLER'S DECISION On October 12, 1973, The American National Bank in Battle Creek, Battle Creek, Mich., applied to the Office of the Comptroller of the Currency for permission to purchase the assets and assume the deposit liabilities of the Athens Branch of The American National Bank and Trust Company of Michigan, Kalamazoo, Mich. The American National Bank in Battle Creek, the purchasing bank, was chartered on October 1, 1973, and now operates one banking office. The bank is a wholly-owned subsidiary of American National Holding Company, Kalamazoo, Mich., a multi-bank holding company, and currently has total assets of $3.5 million and IPC deposits of $1.8 million. Competition for the purchasing bank is provided by The First National Bank and Trust Company of Michigan, Kalamazoo, with deposits of $298.4 million; Michigan National Bank, Battle Creek, with deposits of $1.3 billion; and Security National Bank of Battle Creek, with deposits of $91.6 million. The American National Bank and Trust Company of Michigan, the selling bank, was organized in 1933 and is now the second largest of three commercial banks headquartered in Kalamazoo with total assets of $232.1 million and IPC deposits of $171.6 million. The bank currently operates 16 branch offices and is also a wholly-owned subsidiary of American National Holding Company. Competition for the selling bank is provided by The First National Bank and Trust Company of Michigan, Kalamazoo, with deposits of $298.4 million, and Industrial State Bank and Trust Company, Kalamazoo, with deposits of $104.5 million. The Athens branch office of The American National Bank and Trust Company of Michigan, the subject of the proposed transaction, holds deposits of $3.3 million and is the only bank operating in the village of Athens. Competition for the branch office is provided primarily by banks headquartered in Coldwater, including Branch County Bank with de50 $3,294,000 1 9,102,721 9,721,838 1 To be operated 2 posits of $31.1 million, and Southern Michigan National Bank with deposits of $39.5 million. The principal service area of the Athens branch includes the village of Athens, with an estimated population of 996 persons, and small portions of Calhoun, Kalamazoo, St. Joseph, and Branch counties. The economy of Calhoun County, where the subject branch office is located, is primarily supported by a major cereal manufacturer in Battle Creek which employs nearly half the work force of the area. Rural farmland predominates in the area surrounding Athens, but diversified manufacturing enterprises in nearby Battle Creek insure a balanced employment pattern. At present there is no competition between the purchasing and selling banks. The Athens branch of the selling bank is the closest office of that bank to Battle Creek, located 18 miles distant, with an adequate number of alternative banking facilities operating in the intervening distance. In addition, American National Holding Company controls both the purchasing and selling banks. In view of that close affiliation, the subject application represents a corporate reorganization of commonly owned assets, primarily for the convenience of the two banks, and will not adversely effect competition. More efficient operations and more personalized service to customers of the resulting bank will come from consummation of the proposed transaction. Accordingly, it is the view of this Office that the proposed transaction is in the public interest and will not result in any adverse competitive effects. The application is, therefore, approved. JANUARY 10, 1974. SUMMARY OF REPORT BY ATTORNEY GENERAL The proposed transaction is part of a plan through which the Athens office of The American National Bank and Trust Company of Michigan would be transferred to a newly organized bank. Since both the transferring bank and the acquiring bank are subsidiaries of American National Holding Company, a bank holding company, the proposed trans- action is simply a corporate reorganization and would have no competitive effect. FIRST NATIONAL BANK OF MONROE COUNTY, ABERDEEN, MISS., AND PEOPLES BANK, STARKVILLE, MISS. Banking offices Total assets Name of bank and type of transaction In operation Peoples Bank, Starkville, Miss., with and First National Bank of Monroe County, Aberdeen, Miss. (3656), which had consolidated Mar. 1, 1974, under charter of the latter bank (3656) and title "First United National Bank." The consolidated bank at date of consolidation had COMPTROLLER'S DECISION On November 1, 1973, First National Bank of Monroe County, Aberdeen, Miss., and Peoples Bank, Starkville, Miss., applied to the Comptroller of the Currency for permission to consolidate under the charter of the former and the title, "First United National Bank," and with its main office in Starkville. First National Bank of Monroe County, the charter bank, was organized in 1887 and now, with three branch offices, has assets of $16.8 million and IPC deposits of $10.6 million. The service area of the bank includes Monroe County, which has a population of 34,043. The area is mainly agricultural with an increasing amount of commercial and industrial development near Aberdeen and Amory. Competition for the charter bank is provided by Monroe Banking and Trust Company, Aberdeen, with deposits of $12 million; Bank of Amory, with deposits of $17.5 million; and Security Bank of Amory, with deposits of $11.8 million. The Nettleton, Lee County, branch of the Bank of Mississippi, with deposits of $101.8 million, provides additional competition on the outer fringe of the service area. Peoples Bank, the consolidating bank, was organized in 1889 and presently, with assets of $33.2 million and IPC deposits of $26.1 million, operates three branches at Starkville and Maben. Its service area includes all of Oktibbeha County which has a population of 28,752, western Webster County, northeastern Choctaw County, and southwestern Clay County. The economy of that service area is primarily agricultural with minor commercial and industrial activity in Maben and Starkville where the area's largest employer, Mississippi State University, is located. Competition for the consolidating bank is provided by Security State Bank, Starkville, with deposits of $37,504,693 21,453,037 To be operated 4 4 58,957,729 8 $33.4 million; Bank of Mantee, with deposits of $5 million; and Grenada Bank, with deposits of $121.9 million. There is minimal competition between the charter and consolidating banks because of the great distance between them and because an adequate number of alternative banking facilities exist in the area. The nearest offices of the charter and consolidating banks are 35 miles apart. Consummation of the proposed consolidation will resolve a managerial succession problem at First National Bank of Monroe County and will offer the residents and businesses of its service area new and sophisticated services such as trust services. The consolidation will also result in a higher lending limit to satisfy the increasing needs of the farming and business communities. Applying the statutory criteria, it is concluded that the proposed consolidation is in the public interest and this application is, therefore, approved. JANUARY 25, 1974. SUMMARY OF REPORT BY ATTORNEY GENERAL The head offices of the two banks are approximately 36 miles apart, and the closest offices are more than 30 miles apart. In view of the distance between the two banks and the fact that they operate in different counties, it does not appear that the merger would eliminate significant existing competition. Both banks, however, could branch de novo into the area served by the other. Peoples Bank is the smaller of the two banks operating in Oktibbeha County, holding 46.5 percent of total county deposits as of December 31, 1972. Monroe Bank is the largest of four banks operating in Monroe County, holding 30.5 percent of total county deposits. Several other 51 larger banks, however, may also be considered to be potential entrants into these areas. In view of the existence of other significant potential entrants into the areas served by the parties to this transaction, we conclude that the merger will not eliminate substantial potential competition. THE FIRST NATIONAL BANK OF HANCOCK, HANCOCK, N.Y., HAMDEN, AND THE FIRST NATIONAL BANK OF HAMDEN, N.Y. Banking offices Total assets Name of bank and type of transaction In operation The First National Bank of Hamden, Hamden, N.Y. (12017), with was purchased Mar. 29, 1974, by The First National Bank of Hancock, Hancock, N.Y. (8613) which had After the purchase was effected, the receiving bank had COMPTROLLER'S DECISION On September 14,1973, Hancock National Bank*, Delaware County, Hancock, N.Y., applied to the Comptroller of the Currency for permission to purchase the assets and assume the liabilities of The First National Bank of Hamden, Hamden, N.Y. The First National Bank of Hamden, the selling bank, with approximately $4 million in deposits, was chartered in 1921. It is headquartered in the hamlet of Hamden in the central portion of Delaware County. The selling bank's primary service area consists of the townships of Hamden and Walton which have an approximate population of 7,000. The selling bank ranks eighth in deposit size of the 10 commercial banks headquartered in Delaware County. Financial institutions in direct competition with the selling bank include The National Bank of Delaware County, Walton, with approximately $17.3 million in deposits; The Delaware National Bank of Delhi, Delhi, with approximately $14.1 million in deposits; and Delaware County Federal Savings and Loan Association, Walton, with approximately $33.8 million in assets. Hancock National Bank, the purchasing bank, was organized by Charter New York Corporation, a multi-bank holding company, to effectuate its purchase of The First National Bank of Hamden. Charter New York Corporation proposes to operate The First National Bank of Hamden as a branch of the bank resulting from its merger of Hancock National Bank with The First National Bank of Hancock, N.Y. Charter New York Corporation, with total assets * Hancock National Bank was a non-operating bank merged with The First National Bank of Hancock under the title of the latter, just prior to this purchase. 52 $ 3,572,245 1 10,363,718 14,164,799 1 To be operated 2 of approximately $7.8 billion, ranks seventh in size of the 14 multi-bank holding companies in New York. The largest of its 10 subsidiary banks is Irving Trust Company, New York City, N.Y., with approximately $5 billion in total assets as of June 30, 1973. The larger New York multi-bank holding companies which compete with Charter New York Corporation include First National City Corporation, with total assets of approximately $34.3 billion; Chase Manhattan Corporation, with assets of $28.8 billion; Manufacturers Hanover Corporation, with total assets of approximately $16.3 billion; Chemical New York Corporation and Bankers Trust New York Corporation, each with total assets of approximately $13.4 billion. The proposed purchase will not adversely affect competition. The nearest subsidiary office of Charter New York Corporation to The First National Bank of Hampden is the Binghampton office of Endicott Trust Company which is 60 miles distant. Furthermore, there is no competition between The First National Bank of Hamden and The First National Bank of Hancock. Neither bank has any loans or deposits which have originated from each other's service area. The Binghampton subsidiary office is 43 miles distant from The First National Bank of Hancock. The proposed purchase will not change the relative position of Charter New York Corporation with regard to the other New York bank holding companies. The resulting bank would only rank fifth in deposit size of the 10 banks in Delaware County. Consummation of the proposed purchase will enhance competition. The proposed purchase will remove head office protection in Hamden and open that community to de novo branching of other banks, thereby assuring adequate banking services to the Hamden community. The First National Bank of Hamden presently provides inadequate services to area residents due to limited resources and decreasing capital position. As a result of the proposed transaction, the bank could provide continuing and expanding banking services including a credit card, complete trust department services, and agricultural loan expertise. Accordingly, applying the statutory criteria, it is concluded that the proposed transaction is in the public interest. This application is, therefore, approved. FEBRUARY 21, 1974. NOTE: NO Attorney General's report received. MIDLANTIC NATIONAL BANK, NEWARK, N.J., AND MILLBURN-SHORT HILLS BANK, MILLBURN, N.J. Banking offices Total assets Name of bank and type of transaction In operation Millburn-Short Hills Bank, Millburn, N.J., with and Midlantic National Bank, Newark, N.J. (1316), which had merged Mar. 31, 1974, under charter and title of the latter bank (1316). The merged bank at date of merger had COMPTROLLER'S DECISION On August 10, 1973, Millburn-Short Hills Bank, Millburn, N.J., and Midlantic National Bank, Newark, N.J., applied to the Comptroller of the Currency for permission to merge under the charter and title of the latter. Midlantic National Bank, the charter bank, was organized in 1804 and operates 37 offices with assets of $968.9 million and IPC deposits of $681.6 million. The charter bank is the lead bank in Midlantic Banks, Inc., a multi-bank holding company with deposits of $1.5 billion. The service area of this bank includes all of Essex and Warren counties with a total estimated population of 1.02 million persons. The charter bank is the second largest bank among Essex County-based commercial banks and the third largest bank in deposit size in the State of New Jersey. Competition is provided by First National State Bank of New Jersey, Newark, with deposits of $1.03 billion, which is the lead bank in First National State Bancorporation, a multi-bank holding company; and Peoples Trust of New Jersey, Hackensack, with deposits of $976.6 million, which is a member of United Jersey Banks, a multi-bank holding company. Further competition is provided by all of the State's multi-bank holding companies with statewide affiliations and by the multi-billion dollar banks based in nearby New York City. Millburn-Short Hills Bank, the merging bank, was chartered in 1960 as a State bank and has operated $ 49,402,960 1,004,152,034 1,053,554,995 To be operated 1 38 39 since that time as a unit institution. It presently has assets of $18.7 million and IPC deposits of $16.5 million. The service area of the merging bank encompasses Millburn Township which has an estimated population of 21,140 persons. The merging bank ranks 13th in deposit size among the 18 commercial banks headquartered in Essex County and competes primarily with First National State Bank of New Jersey, Newark, also a competitor of the charter bank; and American National Bank & Trust of New Jersey, Montclair, with deposits of $369 million, which is the lead bank in Princeton American Bancorporation, a multi-bank holding company. Further competition is provided by The National State Bank, Elizabeth, with deposits of $628 million; Summit and Elizabeth Trust Company, with deposits of $189 million; United Counties Trust Company, Elizabeth, with deposits of $323 million; and Springfield State Bank, Springfield, with deposits of $11 million. There is minimal competition between the charter and merging banks because their closest two offices are separated by a distance of 5 miles with an adequate number of alternative banking facilities operating in the intervening distance. The South Orange office of the charter bank is also the closest branch office of any Midlantic Banks, Inc. affiliate. Consummation of the proposed merger will stimulate competition in the service area of the merging bank because the resulting branch in Millburn will be able to offer a larger lending limit, student loans, 53 overdraft checking accounts, a wider range of savings plans, installment loan services, and trust services. That will make the resulting branch a far more viable competitor in the Millburn service area. Furthermore, the competitive hierarchy in the banking industry in New Jersey will not be significantly altered as Midlantic Banks, Inc. will move from third to second fn ranking of size among multi-bank holding companies in the State. Applying the statutory criteria it is concluded that the proposed merger is in the public interest, and this application is, therefore, approved. FEBRUARY 20, 1974 SUMMARY OF REPORT BY ATTORNEY GENERAL The impact of this proposed acquisition will be felt largely in Millburn Township, situated about 8 miles from Newark in the sprawling New York-Newark urban complex. Applicant's nearest offices are located about 5 and 8 miles, respectively, from Bank's Millburn headquarters, and it appears that Applicant derives a significant volume of business from Bank's service area. Thus, the proposed acquisition will eliminate some existing competition in the Millburn Township area. It does not, however, appear that the proposed merger will substantially increase concentration in any relevant banking market. MIDLANTIC NATIONAL BANK/MORRIS, MORRISTOWN, N.J., AND MIDLANTIC NATIONAL BANK/PARSIPPANY, PARSIPPANY-TROY HILLS, N.J. Banking offices Total assets Name of bank and type of transaction In operation Midlantic National Bank/Parsippany, Parsippany-Troy Hills, N.J. (15975), with and Midlantic National Bank/Morris, Morristown, N.J. (15360), which had merged Mar. 31, 1974, under charter and title of the latter bank (15360). The merged bank at date of merger had COMPTROLLER S DECISION On October 4, 1973, Midlantic National Bank/ Morris, Morristown, N.J., and Midlantic National Bank/Parsippany, Parsippany-Troy Hills, N.J., applied to the Comptroller of the Currency for permission to merge under the charter and with the title of the former. Midlantic National Bank/Morris, the charter bank, was organized in 1964 as Madison National Bank. The bank, with assets of $12.1 million and IPC deposits of $4.4 million, presently operates three branches in Morris County. Midlantic National Bank/Parsippany, the merging bank, was chartered in 1972 as Midlantic National Bank. The bank, with assets of $5.3 million and IPC deposits of $2.9 million, operates one branch in its home office community. Both the charter and merging banks are subsidiaries of Midlantic Banks, Inc., a registered bank holding company which controls aggregate deposits of $1.4 billion from its eight member banks. Because the proposed merger is between banks which are totally owned by Midlantic Banks, Inc., this proposal will have no effect on this bank holding company's 54 $ 8,997,817 12,315,879 21,313,697 To be operated 2 4 6 present competitive position as third among New Jersey's bank holding companies and will not eliminate any competition. The primary service area of these two banks is Morris County. That county, with a population of 383,000 people has shown a steady rate of growth with considerable industrial development. There are seven major employers in Morris County, numerous major highways, and four commercial airports. Banking competition is adequate because 21 commercial banks are represented in Morris County, 12 of which are headquartered there. The resulting bank will have total deposits of $14.8 million, and will rank 18th among commercial banks in the county. Nine of the competing banks are members of multi-bank holding companies, those include subsidiaries of First National State Bancorporation and United Jersey Banks, New Jersey's two largest bank holding companies. Consummation of the proposed merger will help to eliminate earnings problems at both the charter and merging banks by allowing the resulting bank to achieve significant operating efficiencies. The two Midlantic National Bank/Parsippany facilities will be operated as branches of the Midlantic National Bank/Morris. There is no present competition between these two banks as they are separated by 6 miles and adequate banking alternatives intervene. Applying the statutory criteria, it is concluded that the proposed merger is in the public interest and this application is, therefore, approved. FEBRUARY 19, 1974. SUMMARY OF REPORT BY ATTORNEY GENERAL Both banks are wholly-owned subsidiaries (except for directors' qualifying shares) of Midlantic Banks, Inc., a multi-bank holding company controlling eight banks holding total deposits of $1.4 billion on December 31, 1972. Morris Bank was acquired by Midlantic Banks in 1972, and Parsippany Bank was organized de novo by Midlantic Banks in 1972. In view of the common ownership of the two banks, and also because the two banks do not hold significant market shares in the area in which they compete (1.8 percent combined of total Morris County commercial bank deposits), we conclude that the proposed transaction would not have a substantial competitive impact. DOMINION NATIONAL BANK, BAILEYS CROSS ROADS, VA., AND PEOPLES BANK AND TRUST COMPANY OF FAIRFAX, FAIRFAX COUNTY, VA. Banking offices Name of bank and type of transaction Total assets In operation Peoples Bank and Trust Company of Fairfax, Fairfax Countv. Alexandria, Va., with and Dominion National Bank, Baileys Cross Roads, Va. (14904), which had merged Apr. 1, 1974, under charter and title of the latter bank (14904). The merged bank at date of merger had COMPTROLLER'S DECISION On October 26, 1973, Dominion National Bank, Fairfax County, Va., and Peoples Bank and Trust Company of Fairfax, Fairfax County, Va., applied to the Comptroller of the Currency for permission to merge under the charter and with the title of the former. Dominion National Bank, the charter bank, was organized in 1960 and now has assets of $78.5 million and IPC deposits of $64 million. The charter bank operates 11 offices in Fairfax County and in the cities of Alexandria and Falls Church. Since December 1971, Dominion National Bank has been a wholly-owned subsidiary of Dominion Bankshares Corporation, Roanoke, Va., the fifth largest banking organization in Virginia, controlling assets of $969.1 million. That holding company controls eight subsidiary banks with 71 banking offices in the State of Virginia; the largest of its subsidiaries is The First National Exchange Bank of Virginia, Roanoke, with deposits of $597 million. Peoples Bank and Trust Company of Fairfax, the merging bank, was organized in 1963 and now has assets of $19 million and IPC deposits of $15.6 $ 19,496,742 94,885,747 112,274,685 To be operated 5 12 17 million. The merging bank operates five offices in Fairfax County. Competition in Fairfax County is provided by 23 banks operating 217 banking offices. Twelve of those banks, with 169 offices, are affiliated with bank holding companies. The largest of those competitors include First Virginia Bank, Falls Church, with deposits of $371 million; United Virginia Bank/First & Citizens National, Alexandria, with deposits of $244.6 million; Arlington Trust Company, Arlington, with deposits of $198 million; and Clarendon Bank and Trust Company, Arlington, with deposits of $200 million. The main offices of the charter and merging banks are approximately 10 miles apart with all of the offices of the two banks separated or circumscribed by numerous competing banks and savings and loan associations. In general, each bank serves a separate and distinct area because the offices of Dominion National Bank are concentrated in the northern and central portions of Fairfax County and the city of Alexandria, and those of Peoples Bank and Trust Company are concentrated in the south-central and southeastern portions of Fairfax County. The closest offices of the 55 two banks are the Lincolnia Branch of Dominion National Bank, located in the Virginia Plaza Shopping Center on the north side of Little River Turnpike, and the Brighton Mall Branch of the merging bank, located in the Brighton Mall Shopping Center on the south side of the Little River Turnpike. Although those two branches are located approximately 0.5 mile apart, the heavily-travelled highway which separates them serves as a geographic barrier. As shopping center branches, each derives a substantial portion of their business from the retail establishments in their respective shopping centers as well as regular shoppers and residents of the areas adjacent to each shopping center. Thus, while some overlap in the service areas of the two banks does exist, it is minimal. Consummation of the proposed merger will allow the present branches of the merging bank to become effective competitors in the area which they now serve. The growth of Peoples Bank and Trust Company has not kept pace with that of other banks in Northern Virginia due to its limited capital base and its restricted lending limit, both of which will be expanded as a result of this merger. Those branches will be able to offer a greater variety of sophisticated banking services which, with added management depth, will further increase their ability to compete. The resulting bank will serve an expanded trade area and will be a more viable competitor for the 21 other banks serving the area. Applying the statutory criteria, it is concluded that the proposed merger is in the public interest and this application is, therefore, approved. FEBRUARY 28, 1974. SUMMARY OF REPORT BY ATTORNEY GENERAL Dominion Bank's offices are centered in northern Fairfax County and in Alexandria, while Peoples Bank's offices are centered in southern Fairfax County. There is some existing competition between the two banks, however. Each bank operates one office in the busy commercial area near the intersection of Virginia Route 236 and Interstate Highway 95. Three other offices of Peoples Bank are located within 4 miles of one or more offices of Dominion Bank. Neither bank, however, is a major factor in Northern Virginia. Dominion Bank and Peoples Bank control, respectively, 6.3 percent and 1.5 percent of total commercial bank deposits in Fairfax County, Falls Church, and Alexandria. There are approximately eight banks larger than Dominion Bank serving this area. Accordingly, we conclude that the effect of the merger on competition would not be significantly adverse. THE FIRST NATIONAL BANK OF VERSAILLES, VERSAILLES, OHIO, AND THE PEOPLES BANK CO., VERSAILLES, OHIO Banking offices Total assets Name of bank and type of transaction In operation The Peoples Bank Co., Versailles, Ohio, with and The First National Bank of Versailles, Versailles, Ohio (9336), which had consolidated Apr. 1, 1974, under charter of the latter bank (9336) and title "Peoples National Bank." The consolidated bank at date of consolidation had COMPTROLLER'S DECISION On August 28, 1973, The First National Bank of Versailles, Versailles, Ohio, and The Peoples Bank Co., Versailles, Ohio, applied to the Comptroller of the Currency for permission to consolidate under the charter of the former and with the title "Peoples National Bank." The First National Bank of Versailles, the charter bank, was originally chartered in 1891 and has operated as a unit institution since that time with 56 $ 7,274,631 9,719,392 16,994,023 To be operated 1 1 1 present assets of $8.1 million and IPC deposits of $6.3 million. The service area of the charter bank encompasses the northeastern section of Darke County, of which Versailles is the principal city with an estimated population of 2,441 persons, and extends to Shelby and Miami counties to include the rural communities of Russia and Bradford. Of the 10 banks headquartered in Darke County, the charter bank ranks sixth in deposit size and ranks 15th in size among the 18 banks in its service area. Principal competitors for the bank in- elude The Citizens Baughman National Bank, Sidney, with deposits of $35.4 million and The Miami Citizens National Bank and Trust Company, Piqua, with deposits of $44.8 million. Further competition is provided by The Citizens Bank Company, Ansonia, with deposits of $5.4 million; The Osgood State Bank, Osgood, with deposits of $5.8 million; The Citizens State Bank of Greenville, Ohio, with deposits of $8.7 million; Greenville National Bank, Greenville, with deposits of $26.3 million; and The Second National Bank of Greenville, Ohio, with deposits of $27.4 million. The Peoples Bank Co., the consolidating bank, was chartered in 1905 and has operated as a unit institution since that time with present assets of $6.7 million and IPC deposits of $5.7 million. The service area of the consolidating bank is identical to that of the charter bank. The consolidating bank ranks eighth in deposit size of the 10 banks headquartered in Darke County, and 16th in size among the 18 banks in its service area. The bank competes directly with the charter bank and all competitors of the charter bank since it is physically adjacent to that institution and is the only other commercial bank in Versailles. The resulting bank would rank fourth in deposit size among Darke County banks and 10th among service area banks. The charter bank is by far the more aggressive of the two subject institutions; it is larger in size, has a greater lending limit, and a considerably greater loan-to-deposit ratio. Still, both are small, conservative institutions and neither has kept pace with the growth of the Versailles economy. Although the two subject institutions are the only commercial banks in the town of Versailles, keen competition for services such as real estate mortgage loans, time and savings deposits, and instalment credit is provided by Versailles Savings and Loan Company and American Budget Company. Thus, consummation of the proposed consolidation will not eliminate alternative sources of financial services. In addition to those non-bank competitors, there are sufficient banking offices located within the service area of the charter and consolidating banks and within reasonable distance over good roads to allow the public several competitive alternatives for the services they offer. For example, the Russia, Ohio, branch office of The Citizens Baughman National Bank is located 3 miles east of Versailles and actively solicits business and services the small Versailles community. With approximately 35 percent of the Darke County labor force commuting outside the county for employment, banks located along major arteries in the communities of Piqua, Celina, Covington, and Greenville are also important competitors for the Versailles banks. The significance of the competition between the two subject banks is reduced considerably by the extremely conservative lending policy of the consolidating bank. The absence of an active instalment loan program at that institution also contributes to the fact that the consolidating bank makes loans at an overall rate only one-half that of the charter bank. Consolidation will result in a lessening of that restrictive attitude. Effectuation of the proposed consolidation will result in a much needed increase in management depth and a better utilization of management expertise. Management at the consolidating bank is aging with no replacements presently being trained and management at the charter bank is considerably younger and more aggressive. Combining those management teams will enable competent personnel to devote more time to the solicitation of business and to serving the banking needs of the resulting bank's customers. The outgrowth of that greater expertise will be an improvement in the personal financial leadership by commercial bankers within the community and an increase in the public benefits of such leadership. Physical facilities at both banks have been remodeled recently but remain cramped and overcrowded, creating poor working conditions. Both managements and boards of directors have been aware of the problems for several years but recent earnings have precluded financing any solution. Upon consummation of the proposed consolidation, the resulting bank will have the capacity to modernize its offices and to begin construction of a new, customer-oriented commercial bank in downtown Versailles. Consolidation of the charter and consolidating banks will result in the offering of several improved and expanded services including higher interest rates on savings accounts, more frequent compounding of savings interest, fully automated processing of all types of accounts, and additional drive-in facilities. Further, improvements in operational standards will free employees to deal with customers on a more personal level, resulting in heightened customer satisfaction. Consummation of the proposed transaction appears likely to have a pro-competitive effect by stimulating larger commercial banks in the area to apply for branch offices in Versailles. While the major banks located in the relevant service area 57 present a competitive threat at present, permission to branch inside Versailles under current conditions would not likely be granted. Consolidation will convert a small, two-bank town, which is unable to support a new entrant, into a town with one stronger commercial bank able to tolerate intensified competition. Regulatory authorities will be more favorably disposed to entertain applications for new branch banking offices in such a community. Because both the charter and consolidating banks are located in a small community, a significant percentage of the local population holds stock in these institutions. Few of those stockholders own shares in both banks and none holds a majority in either. Thus, any improvement in the financial condition of the two subject banks is a boon to the inhabitants of the community, not only as customers, but also as interested investors in the institutions. Consummation of the proposed consolidation will result in further benefit by allowing an increased lending limit more in keeping with the needs of the community. In recent years both banks have been unable to service the financial requirements of the large agricultural segment of the area economy, thus forcing local businessmen and farmers to turn to other financial institutions in- and outside of Darke County. Also, consolidation will enable the stronger resulting bank to hold itself available for participations with other banks on local business, an opportunity it is presently denied. At the same time, the consolidation will create the capacity in the resulting bank to service other community businesses on a strictly local basis. Finally, significant ramifications of a larger lending limit include the attraction of new 58 businesses to the Versailles area and the presence of the heretofore lacking capability to loan funds to the town government for municipal improvements. On balance, this transaction will result in better banking for the area. Applying the statutory criteria, it is concluded that the proposed consolidation is in the public interest, and this application is, therefore, approved. JANUARY 17, 1974. SUMMARY OF REPORT BY ATTORNEY GENERAL First Bank and Peoples Bank are located next door to each other in Versailles, and are the only two banks in that community. The closest banking office to Versailles is The Citizens Baughman National Bank, Sidney, Ohio which operates a branch in Russia, about 5 miles east of Versailles, in Mercer County. About 10 banks operate offices within 15 miles of Versailles, among them two banks in Greenville, each holding total deposits in excess of $25 million. There is probably some competition between the Versailles banks and these other nearby banks. The application does not make clear the extent to which other banks in the general vicinity draw deposits from, or make loans to, customers in the immediate Versailles area. However, in view of the importance of customer convenience in commercial banking, we conclude that the proposed merger would have significantly adverse competitive effects in the Versailles area. To the extent that the application argues that the merger will bring competitive and other benefits to the communities to be served, comparable benefits might be achieved by affiliation with a bank holding company not already competing in Darke County. MARYLAND NATIONAL BANK, BALTIMORE, MD., AND EUTAW SAVINGS BANK OF BALTIMORE, BALTIMORE, MD. Banking offices Total assets Name of bank and type of transaction In operation Eutaw Savings Bank of Baltimore, Baltimore, Md., with was purchased Apr. 11, 1974, by Maryland National Bank, Baltimore, Md. (13746), which had After the purchase was effected, the receiving bank had COMPTROLLER S DECISION On April 11, 1974, application was made to the Comptroller of the Currency by the Maryland National Bank, Baltimore, Md., for permission to purchase the assets and assume deposit liabilities of the Eutaw Savings Bank of Baltimore, Baltimore, Md. In accordance with the provisions of 12 U.S.C. 1828(c)(6), it is found that an emergency exists and that this Office must act immediately to prevent the $ 128,826,293 1,810,246,603 1,938,200,461 To be operated 7 123 130 probable failure of the Eutaw Savings Bank of Baltimore, and to protect its depositors and creditors. Accordingly, the application of the Maryland National Bank to purchase the assets and assume the deposit liability of the Eutaw Savings Bank of Baltimore, is approved. APRIL 11, 1974. NOTE: Due to the emergency nature of the situation, no report on competitive factors was requested. THE BARABOO NATIONAL BANK, BARABOO, WIS., AND FARMERS STATE BANK, ROCK SPRINGS, WIS. Banking offices Name of bank and type of transaction Total assets In operation Farmers State Bank, Rock Springs, Wis., with was purchased Apr. 12, 1974, by The Baraboo National Bank, Baraboo, Wis. (14397), which had After the purchase was effected, the receiving bank had COMPTROLLER'S DECISION On November 1, 1973, The Baraboo National Bank, Baraboo, Wis., applied to the Comptroller of the Currency for permission to purchase the assets and assume the liabilities of Farmers State Bank, Rock Springs, Wis. The Baraboo National Bank, Baraboo, Wis., the purchasing bank, was organized in 1857 and now, with assets of $30.9 million and IPC deposits of $25.6 million, operates one branch office. The service area of the bank includes the town of Baraboo and peripheral rural areas with an estimated total population of 8,000 persons. The economy of Baraboo is supported by a mixture of light and heavy industry, retail commerce, tourism, and agriculture. The purchasing bank is now the larger of two banks located in the town of Baraboo. It competes directly with The First National Bank and Trust $ 2,061,633 1 35,032,916 34,974,525 2 To be operated 3 Company of Baraboo, which has deposits of $12.2 million. Farmers State Bank, Rock Springs, Wis., the selling bank, was organized in 1912 and has operated since that time as a unit institution. It currently has assets of $1.9 million and IPC deposits of $1.7 million. The service area of the selling bank includes the community of Rock Springs and surrounding areas within a 3- to 8-mile radius, including the towns of Reedsburg, Loganville, and North Freedom. Economic activity in the Rock Springs area is centered primarily on dairy farming and such other agricultural pursuits as cash cropping and feed lot operations. Principal competitors of the selling bank are The Reedsburg Bank and its branch at North Freedom, with total deposits of $22.2 million, and Farmers and Merchants Bank of Reedsburg and its branch at Loganville, with total deposits of $17 million. 59 There is minimal competition between the purchasing and selling institutions because their two closest offices are separated by a distance of 8 miles and because the small size of the geographical area served by the selling bank prevents it from being a significant competitor for the purchasing bank. Also, an adequate number of alternative banking facilities operate in the area. Consummation of the proposed purchase would provide the area now served by Farmers State Bank with expanded banking services, including an increased lending limit, trust department services, consumer installment loans, family financial counseling, and a specialized farm loan officer. In addition, plans include the building of a new banking facility in Rock Springs which would be more convenient for customers than the existing antiquated structure. Accordingly, it is the conclusion of this Office that the proposed transaction is in the public interest and this application is, therefore, approved. MARCH 11, 1974. SUMMARY OF REPORT BY ATTORNEY GENERAL The offices of the parties to the instant transaction are approximately 8 miles apart with one competitive alternative in the intervening community of North Freedom. According to the application, neither bank draws substantial deposit or loan business from the immediate service area of the other. It does not appear that the proposed transaction would eliminate substantial existing competition. Restrictions on branching and the nature of the community in which Bank is located indicate that the prospects for additional branching in that area by Applicant are not great. Thus, although the proposed transaction would slightly increase concentration in commercial banking in Sauk County, we do not believe that its overall competitive effect would be significantly adverse. BANKERS TRUST OF SOUTH CAROLINA, N.A., COLUMBIA, S.C., AND THE PEOPLES BANK, BEAUFORT, S.C. Banking offices Name of bank and type of transaction Total assets In operation The Peoples Bank, Beaufort, S . C , with and Bankers Trust of South Carolina, N.A., Columbia, S.C. (10635), which had merged Apr. 22, 1974, under charter and title of the latter bank (10635). The merged bank at date of merger had COMPTROLLER'S DECISION On November 8, 1973, The Peoples Bank, Beaufort, S . C , and Bankers Trust of South Carolina, N.A., Columbia, S . C , applied to the Comptroller of the Currency for permission to merge under the charter and with the title of the latter. Bankers Trust of South Carolina, the charter bank, was organized in 1886 and now, with assets of $479.6 million and IPC deposits of $342.2 million, operates 78 branch offices. The service area of the bank includes 35 communities throughout the State, with the heaviest concentration in the central, westcentral, and northwestern sections of the State. Operating a statewide system of branch offices, Bankers Trust of South Carolina serves a complete cross-section of the State's economic strata. The charter bank is now the third largest commercial bank in the State and competes primarily 60 $ 33,698,335 519,892,860 553,591,195 To be operated 6 83 89 with The South Carolina National Bank, Charleston, with deposits of $702.6 million; The Citizens and Southern National Bank of South Carolina, Charleston, with deposits of $418 million; First National Bank of South Carolina, Columbia, with deposits of $335.6 million; and First-Citizens Bank and Trust Company of South Carolina, Columbia, with deposits of $135 million. The Peoples Bank, the merging bank, was organized in 1902 and now, with assets of $34.6 million and IPC deposits of $27.8 million, operates five branch offices. The merging bank is located in Beaufort County and its service area includes the city of Beaufort, Parris Island, and Hilton Head Island, all of which are located within Beaufort County. The Beaufort County economy has, for many years, been heavily dependent upon extensive military operations; limited light industry, truck farming, commercial fishing, tourism, and residen- tial resort development comprise the remaining economic base. The merging bank is the largest of three commercial banks headquartered in Beaufort County and competes primarily with the Bank of Beaufort, with deposits of $23.4 million, and The First Carolina Bank, Yemassee, with deposits of $4.8 million. There is no competition between the charter and merging banks because their closest two offices are separated by relatively large distances and an adequate number of alternative banking facilities operate in the intervening distance. The closest offices of the two banks are approximately 69 miles apart, and the small size of the merging bank prevents it from being a significant competitor for the charter bank. Consummation of the proposed merger will stimulate competition in the service area of the merging bank because the resulting branch in Beaufort will offer a more complete line of banking services and facilities to include expanded lending limits and improved trust services. That will generally improve the bank's quality of operation and contribute to the area's appeal for increased and diversified industrial development. In addition, the proposed merger will favorably resolve a number of serious management problems experienced by the merging bank. The resulting bank will remain the third largest commercial bank in South Carolina. Applying the statutory criteria it is concluded that the proposed merger is in the public interest and this application is, therefore, approved. MARCH 19, 1974. SUMMARY OF REPORT BY ATTORNEY GENERAL The head offices of the respective banks are about 112 miles from each other. The nearest offices of Bankers Trust—in the Charleston area—are approximately 70 miles from the nearest office of Peoples Bank. The amount of direct competition that would be eliminated by the proposed acquisition would be de minimis. Beaufort County is served by three local independent banks of which Peoples Bank is the largest. Total deposits in the county as of December 31, 1972 were $57.4 million. Peoples Bank held total deposits of $29.2 million, or 50.7 percent of county deposits. Of the some 95 banking organizations in South Carolina, the five largest currently hold 60.1 percent of the total deposits in the State. Consummation of the proposed acquisition would raise this ratio to 60.9 percent. There are at present seven banks in the State with deposits in excess of $100 million. Five of these operate offices throughout the major portions of the State and may be considered significant potential entrants into Beaufort County to the extent its present rate of economic expansion would support such new entry. Bankers Trust, as the third largest bank in the State, with approximately 11.6 percent of total State deposits, is among the significant potential entrants into Beaufort County. Its entry into the county through the acquisition of Peoples Bank, the largest in the county and also relatively prosperous, will have some adverse effects on potential competition. THE FIRST NATIONAL BANK OF JASPER, JASPER, ALA., AND DORA BANKING AND TRUST COMPANY, DORA, ALA. Banking offices Name of bank and type of transaction Total assets In operation Dora Banking and Trust Company, Dora, Ala., with and The First National Bank of Jasper, Jasper, Ala. (7746), which had consolidated Apr. 30, 1974, under charter and title of the latter bank (7746). The consolidated bank at date of consolidation had COMPTROLLER'S DECISION On November 9, 1973, The First National Bank of Jasper, Jasper, Ala., and Dora Banking and Trust Company, Dora, Ala., applied to the Comptroller of the Currency for permission to consolidate under the charter and with the title of the former. $ 7,334,748 52,221,754 59,584,573 To be operated 1 3 4 The First National Bank of Jasper, the charter bank, was organized in 1905, and operates two branch offices. It possesses total assets of $46.1 million and IPC deposits of $33.7 million. The service area of the bank encompasses western Walker County, an industrial and rural area. Local competitors of the charter bank include Walker 61 County Bank, with deposits of $13.5 million; Bank of Carbon Hill, with deposits of $5.5 million; Bank of Parrish, with deposits of $5.3 million; and Cordova Citizens Bank, with deposits of $4.1 million. Dora Banking and Trust Company, the consolidating bank, was organized in 1906 and operates as a unit institution. It has total assets of $6.5 million and IPC deposits of $5.3 million. The consolidating bank serves the eastern section of Walker County and a small portion of Jefferson County, an economically depressed rural area where many of the residents commute to employment in Birmingham. Local competitors of the consolidating bank include a branch of The First National Bank of Birmingham, with branch deposits of $8.5 million, and Sumiton Bank, with deposits of $4.3 million. While competition between the subject banks is minimal because the eastern and western portions of Walker County are divided by the Warrior River, they both feel the competitive impact of the large Birmingham banks which canvass their area. Consummation of the proposed transaction will result in no adverse competitive effects. Rather, competition will be enhanced in eastern Walker County because the management succession problems of the consolidating bank will be resolved and because increased and more efficient services will be offered, for example, a larger lending limit, expanded loan policies, and higher interest rates on time and savings deposits. Applying the statutory criteria, it is the opinion of this Office that the proposed transaction is in the public interest and will result in no adverse competitive effects. This application is, therefore, approved. MARCH 6, 1974. SUMMARY OF REPORT BY ATTORNEY GENERAL The communities of Jasper and Dora are both located in Walker County, at a distance of approximately 15 miles. According to the application, First National, the largest bank in the county, draws a minor percentage of its deposit and loan business from the eastern part of the county where Dora Bank's service area is located. However, these deposits appear more substantial when compared to the total banking business done by Dora Bank. Thus, the proposed transaction would eliminate some existing competition and increase concentration in commercial banking in Walker County. These effects may be lessened by the fact that Dora is approximately as close to the city of Birmingham and its environs as it is to Jasper, and the Warrior River provides a natural barrier, which, according to the application, limits commercial intercourse between the eastern and western sections of the county. THE PEOPLES NATIONAL BANK AND TRUST COMPANY OF WASHINGTON, WASHINGTON, IND., AND FARMERS STATE BANK, PLAINVILLE, IND. Banking offices Total assets Name of bank and type of transaction In operation Farmers State Bank, Plainville, Ind., with and The Peoples National Bank and Trust Company of Washington, Washington, Ind. (3842), which had . . . . . . . . . . . . . . _ . merged Apr. 30, 1974, under charter and title of the latter bank (3842). The merged bank at date of merger had COMPTROLLER'S DECISION On January 3, 1974, The Peoples National Bank and Trust Company of Washington, Washington, Ind., and Farmers State Bank, Plainville, Ind., applied to the Comptroller of the Currency for permission to merge under the charter and with the title of the former. The Peoples National Bank and Trust Company of Washington, the charter bank, was organized in 62 To be operated % 1,876,645 24,867,345 26,682,905 1888 and presently, with total assets of $23.1 million and IPC deposits of $19.5 million, operates one drive-in branch. It is the largest of six banks in Daviess County, the service area of the charter bank. Agriculture comprises the basis for the economy of the service area. Direct competition for the charter bank is provided by the three other banks located in Washington: Citizens Bank and Trust Company, with deposits of $19.3 million; State Bank of Washington, with deposits of $12.3 million; and Washington National Bank, with deposits of $12.3 million. Farmers State Bank, the merging bank, was organized in 1908 and presently operates a single office with total assets of $2.1 million and IPC deposits of $1.7 million. Because of its relatively small size and scope of operations, the merging bank's service area is limited to the immediate vicinity of Plainville where it is the only bank. The economy of this service area is based on agriculture. There is only minimal competition between the charter and merging banks because of the distance between them. The charter and merging banks are located 11 miles apart. Even though the small service area of the merging bank comprises a minor portion of the service area of the charter bank, the merging bank is not an effective competitor for the charter bank because of its size, lack of aggressiveness, and isolated location. Consummation of the proposed merger will resolve the acute management succession problem of the merging bank and enable the resulting bank to provide new and improved services to the residents of Plainville such as a larger lending limit, a greater variety of time deposits, trust services, real estate mortgage loans, and automated bookkeeping for demand deposits including monthly statements. The resulting bank will remain the largest bank in Daviess County but only by a small margin. Therefore, the resulting bank will have little, if any, advantage over its nearest competition in economy of operation and scope of services. Applying the statutory criteria, it is concluded that the proposed merger is in the public interest and this application is, therefore, approved. MARCH 29, 1974. SUMMARY OF REPORT BY ATTORNEY GENERAL The banks are located 10 miles apart, with no banking offices intervening. Thus, there is probably some competition between the two which would be eliminated by the merger. Six commercial banks presently operate in Daviess County. Peoples Bank is the largest of these, holding 28.3 percent of total county commercial bank deposits. Farmers Bank is the smallest bank in the county, holding 2.5 percent. Thus, the resulting bank would increase its leading share of Daviess County deposits to 30.8 percent. Competition between these two banks may be limited by the distance which separates them and by Farmers Bank's small size; however, the proposed merger would probably have some adverse competitive effect. FIDELITY NATIONAL BANK, HALIFAX COUNTY, VA., AND THE HALIFAX BRANCH OF THE FIDELITY NATIONAL BANK, LYNCHBURG, VA. Banking offices Total assets Name of bank and type of transaction In operation Halifax Branch of The Fidelity National Bank, Lynchburg, Va. (1522), with was purchased May 1, 1974, by Fidelity National Bank, Halifax County, Va. (16313), which had. After the purchase was effected, the receiving bank had COMPTROLLER'S DECISION On December 7, 1973, Fidelity National Bank, Halifax County, Va., applied to the Comptroller of the Currency for permission to purchase the assets and assume the liabilities of the Halifax Branch of The Fidelity National Bank, Lynchburg, Va. Fidelity National Bank, Halifax County, Va., the purchasing bank, is a new National banking association in the process of organization. The proposed location of the main office of the purchasing bank is the Centerville area of Halifax County, midway be $20,681,724 2,000,000 22,681,724 To be operated 1 0 2 tween South Boston and Halifax. Fidelity American Bankshares. Inc., Lynchburg, a registered multibank holding company, has submitted an application to the Board of Governors of the Federal Reserve System for permission to acquire all the voting shares, except for directors' qualifying shares, of the purchasing bank. The Board of Governors of the Federal Reserve System announced its approval of that application on September 24, 1973. The Fidelity National Bank, Lynchburg, the selling bank, with assets of $20.6 million and IPC deposits of $19.9 million, desires to sell its existing 63 Halifax branch to the purchasing bank. Fidelity American Bankshares, Inc., presently owns a controlling interest in the selling bank. Since both the purchasing and selling banks are owned by the same bank holding company, Fidelity American Bankshares, Inc., the proposed transaction essentially constitutes an internal corporate reorganization. As a wholly-owned subsidiary of Fidelity American Bankshares, Inc., the purchasing bank would be able to establish branch offices throughout Halifax County under Virginia law. The purchasing bank will conduct the same banking business at the same location as presently used by the selling bank. Applying the statutory criteria, it is concluded that the proposed transaction is in the public interest and this application is, therefore, approved. MARCH 11, 1974. SUMMARY OF REPORT BY ATTORNEY GENERAL The proposed transaction is part of a plan through which the Halifax Branch of The Fidelity National Bank would be transferred to a newly organized bank. Since both the transferring bank and the acquiring bank are subsidiaries of Fidelity American Bankshares, Inc., a bank holding company, the proposed transaction is simply a corporate reorganization and would have no competitive effect. THE FULTON NATIONAL BANK OF LANCASTER, P A . , AND THE HUMMELSTOWN NATIONAL BANK, HUMMELSTOWN, P A . Banking offices Total assets Name of bank and type of transaction In operation The Hummelstown National Bank, Hummelstown, Pa. (2822), with and The Fulton National Bank of Lancaster, Lancaster, Pa. (2634), which had merged May 10,1974, under charter and title of the latter bank (2634). The merged bank at date of merger had COMPTROLLER'S DECISION On November 28, 1973, The Hummelstown National Bank, Hummelstown, Pa., and The Fulton National Bank of Lancaster, Lancaster, Pa., applied to the Comptroller of the Currency for permission to merge under the charter and title of the latter. The Fulton National Bank of Lancaster, the charter bank, was organized in 1882 and, with assets of $224 million and IPC deposits of $178 million, operates 13 branch offices. The service area of the bank consists of the northern three-quarters of Lancaster County and southwestern Dauphin County, including the city of Harrisburg. The strong economy of that service area is supported by a wide array of industry and commerce combined with the agricultural activities in Lancaster County. The charter bank ranks fifth in size in the very active banking community of Lancaster and the surrounding counties. Competition is provided by the $745 million deposit American Bank and Trust Company, Reading, Pa.; the $684 million deposit National Central Bank, Lancaster, Pa.; the $455 million deposit Commonwealth National Bank, Harrisburg, Pa.; the $300 million deposit Dauphin Deposit Trust 64 $ 19,652,739 255,255,958 274,908,698 To be operated 2 15 17 Company, Harrisburg, Pa.; and 20 other commercial banks. The Hummelstown National Bank, the merging bank, was organized in 1868 and, with assets of almost $19 million and IPC deposits of over $16 million, operates one branch office. The bank has placed emphasis on serving the local community of Hummelstown, a residential and farming area, located on the fringe of Harrisburg, Pa. The merging bank ranks 20th among the 25 banks competing in this area. Although growth has been slow, the bank has continued to operate profitably and is in sound condition. A key figure in the bank's management, however, is in ill health and is expected to retire in the near future. Competition in the service areas of the two banks involved will not be detrimentally affected by this proposal despite the fact that they operate in an area dominated by the same group of commercial banks. The resulting bank will be more able to compete with the four larger banks in this service area and the merging bank, which will become a branch of the charter bank, will be able to draw from the managerial resources of the charter bank. Applying the statutory criteria, it is the conclusion of this Office that the proposed merger will result in no adverse competitive effects and will benefit the public interest. This application is, therefore, approved. APRIL 9, 1974. SUMMARY OF REPORT BY ATTORNEY GENERAL While the main offices of Fulton Bank and Hummelstown Bank are over 25 miles apart, both banks operate offices in the Greater Harrisburg Area. Thus, the proposed merger would eliminate at least some existing competition. However, it does not appear that the proposed merger would substantially increase concentration in any relevant geographic market. Fulton Bank is one of the larger banks legally capable of expanding its operations in Dauphin County, but its acquisition of the relatively small Hummelstown Bank would not appear to eliminate substantial potential competition. NORTH CAROLINA NATIONAL BANK, CHARLOTTE, N.C., AND THE FIRST NATIONAL BANK OF MOUNT AIRY, MOUNT AIRY, N.C. Banking offices Name of bank and type of transaction Total assets In operation $ 19,174,569 The First National Bank of Mount Airy, Mount Airy, N.C. (4896), with and North Carolina National Bank, Charlotte, N.C. (13761), which had 3,109,145,446 merged May 17, 1974, under charter and title of the latter bank (13761). The merged bank at 3,128,334,357 date of merger had COMPTROLLER'S DECISION On September 17, 1973, North Carolina National Bank, Charlotte, N . C , and The First National Bank of Mount Airy, Mount Airy, N . C , applied to the Comptroller of the Currency for permission to merge under the charter and with the title of the former. The First National Bank of Mount Airy, the merging bank, was organized in 1893, and operates two branch offices and one seasonal facility. With total assets of $21 million and IPC deposits of $16.7 million, it ranks 37th among the 87 banks located in North Carolina. The service area of the bank encompasses the eastern and northern portions of Surry County, a marketing and agricultural area, and a small portion of mountainous southern Virginia. Approximately 50,000 people reside in that area. The primary competitors of the merging bank include branches of The Northwestern Bank, which has deposits of $791 million, and a branch of Planters National Bank and Trust Company, which has deposits of $176.8 million. In addition, First Citizens Bank and Trust Company, which has deposits of $867 million, has received approval to open a branch in Mount Airy. North Carolina National Bank, the charter bank, was organized in 1933 and operates 148 domestic branches and two foreign branches. With total To be operated 4 149 153 assets of $3 billion and IPC deposits of $1.5 billion, it is the second largest bank in North Carolina. Its service area encompasses portions of the entire State of North Carolina. Competitors for the charter bank include Wachovia Bank and Trust Company, N.A., with deposits of $2 billion; First Union National Bank of North Carolina, with deposits of $1.3 billion; First Citizens Bank and Trust Company; and the Northwestern Bank. Direct competition between the subject banks is minimal since their closest offices are separated by a distance of approximately 36 miles. Few common customers exist and the bulk of the charter bank's business from the service area of the merging bank is of "National account" character or is generated through a dealer relationship. Consummation of the proposed transaction will result in no adverse competitive effects. Competition within the service area of the merging bank will be enhanced through the input of aggressive management personnel and policies and through the establishment of new and expanded services such as accounts receivable loans, an agricultural business department, certificates of deposit, correspondent bank facilities, equipment loans, estate planning, an international department, letters of credit, and trust services. 65 Applying the statutory criteria, it is the opinion of this Office that the proposed transaction is in the public interest and will result in no adverse competitive effects. This application is, therefore, approved. MARCH 5, 1974. SUMMARY OF REPORT BY ATTORNEY GENERAL The nearest offices of the parties are located about 36 road miles apart with several banking offices in the intervening area. Thus, it appears that the proposed transaction would eliminate only a limited amount of existing competition. Although NCNB could legally establish de novo offices in Surry County, the effects of this transaction on potential competition are diminished somewhat by the existence of other significant potential entrants. The proposed merger would also slightly increase statewide concentration of commercial banking in North Carolina, where the four largest banks, as of December 31, 1972, held more than 60 percent of statewide deposits. THE ST. LAWRENCE NATIONAL BANK, CANTON, N.Y., AND LEWIS COUNTY TRUST COMPANY, LOWVILLE, N.Y. Banking offices Name of bank and type of transaction Total assets In operation Lewis County Trust Company, Lowville, N.Y., with and The St. Lawrence National Bank, Canton, N.Y. (8531), which had merged May 17,1974, under charter and title of the latter bank (8531). The merged bank at date of merger had COMPTROLLER'S DECISION On January 23, 1974, Lewis County Trust Company, Lowville, N.Y., and The St. Lawrence National Bank, Canton, N.Y., applied to the Comptroller of the Currency for permission to merge under the charter and with the title of the latter. Lewis County Trust Company, the merging bank, was established in 1863 and operates one branch office in Lewis County and one on the eastern border of Jefferson County. With total assets of $24.2 million and IPC deposits of $17.3 million, it ranks sixth in size among the 19 commercial banks headquartered in the Fifth Banking District. The economy of the service area is dependent on a variety of influences including mining, manufacturing, agriculture, and retailing. Competitors for the merging bank include Marine Midland Bank-Northern, with deposits of $168 million, a member of Marine Midland Banks, Inc.; The National Bank of Northern New York, with deposits of $118 million; Seaway National Bank, with deposits of $11.3 million; and The Lyons Falls National Bank, with deposits of $3.7 million. The St. Lawrence National Bank, the charter bank, was established in 1866 and operates 10 branch offices in St. Lawrence County and one branch office each in Lewis and Jefferson counties. 66 $ 26,017,160 79,901,518 107,033,826 To be operated 3 13 16 With total assets of $73.8 million and IPC deposits of $53.9 million, it ranks third in size among the 19 commercial banks headquartered in the Fifth Banking District. The economy of the service area is diversified and includes mining, higher education, agriculture, and retailing. Competitors for the charter bank include Marine Midland Bank-Northern, The National Bank of Northern New York, and Farmers National Bank of Malone which, with deposits of $41 million, is a member of Bankers Trust New York Corporation. Competition between the subject banks is negligible since their closest offices are separated by a distance of approximately 12 miles and their other offices are separated by a distance of at least 20 miles. Consummation of the proposed transaction will result in no adverse competitive effects. Rather, the resulting bank will provide more effective competition for the larger banks in the area by providing improved and expanded services such as a larger lending limit, more competitive interest rates on time deposits, expanded trust department, investment advisory services, and data processing services. In addition, the "head office protection" that exists in Lowville will be removed thus allowing de novo branching into that community by other banks. Applying the statutory criteria, it is the conclusion of this Office that the proposed transaction is in the public interest and will result in no adverse competitive effects. This application is, therefore, approved. APRIL 1, 1974. SUMMARY OF REPORT BY ATTORNEY GENERAL St. Lawrence Bank's newly opened (December 1973) de novo branch in Black River is located about 13 miles from the nearest Lewis Trust office. No other St. Lawrence Bank offices are situated within 25 miles of Lewis Trust. Thus, it does not appear that the proposed transaction will eliminate substantial existing competition between the parties or significantly increase concentration in any relevant banking market. St. Lawrence Bank is one of the larger banks in New York's Fifth Banking District, and already serves many of its local markets. Although the proposed transaction may eliminate some potential for increased competition between the parties, the existence of other significant potential entrants into the areas served by these banks indicates that the overall competitive effect of this transaction would not be significantly adverse. PENNSYLVANIA NATIONAL BANK AND TRUST COMPANY, POTTSVILLE PA., AND THE DIME BANK OF LANSFORD, LANSFORD, PA. Banking offices Total assets Name of bank and type of transaction In operation The Dime Bank of Lansford, Lansford, Pa., with and Pennsylvania National Bank and Trust Company, Pottsville, Pa. (1663), which had merged May 31, 1974, under charter and title of the latter bank (1663). The merged bank at date of merger had COMPTROLLER'S DECISION On December 3, 1973, The Dime Bank of Lansford, Lansford, Pa., and Pennsylvania National Bank and Trust Company, Pottsville, Pa., applied to the Comptroller of the Currency for permission to merge under the charter and with the title of the latter. Pennsylvania National Bank and Trust Company, the charter bank, was organized in 1866 and presently operates 17 branches. It has total assets of $182 million and IPC deposits of $160 million. The service area of the charter bank encompasses all of Schuylkill County, south-central Northumberland County, southwestern Dauphin County, and the extreme southern tip of Columbia County. The economy of that area depends upon a variety of light and medium industries. The charter bank ranks 10th in size among the banks in its service area and competes primarily with American Bank and Trust Company, Reading, with deposits of $717 million; National Central Bank, Lancaster, with deposits of $684 million; Northeastern National Bank of Pennsylvania, Scranton, with deposits of $383 million; First Valley Bank, Lansford, with deposits of $320 million; First National $ 10,719,813 206,100,697 216,877,111 To be operated 1 18 19 Bank of Eastern Pennsylvania, Wilkes-Barre, with deposits of $304 million; Commonwealth National Bank, Harrisburg, with deposits of $300 million; Merchants National Bank of Allentown, with deposits of $272 million; Fulton National Bank, Lancaster, with deposits of $199 million; and Cumberland County National Bank, New Cumberland, with deposits of $155 million. The Dime Bank of Lansford, the merging bank, was organized in 1912 and presently operates a single office. It has total assets of $9.9 million and IPC deposits of $8.8 million. The service area of the merging bank is confined to a region known as Panther Creek Valley, a long narrow valley including the communities of Coaldale, Lansford, Nesquehoning, and Summit Hill. The economy of that area is based upon a wide array of light manufacturing and textiles. Direct competition for the merging bank in Panther Creek Valley is provided by American Bank and Trust Company of Pennsylvania, Reading, with deposits of $717 million, and First Valley Bank, Lansford, with deposits of $320 million. There is only minimal competition between the charter and merging banks. Although the nearest office of the charter bank is located in Tamaqua, 5 67 miles west of Lansford, because of its limited resources and unaggressive management, the merging bank has confined its limited services to Panther Creek Valley. Consummation of the proposed merger will stimulate competition in the service area of the merging bank because the branch in Lansford will offer new and improved services such as a substantially increased lending limit, increased rates on time deposits, 90-day passbook savings, a credit card plan, and trust services. The merging bank will also be able to alleviate its acute management succession problem by availing itself of the charter bank's management expertise. Applying the statutory criteria, it is concluded that the proposed merger is in the public interest and this application is, therefore, approved. APRIL 23, 1974. SUMMARY OF REPORT BY ATTORNEY GENERAL Pennsylvania Bank's office nearest Dime Bank is located in Tamaqua, Schuylkill County, about 5 miles southwest of Lansford. There is one competitive alternative in the intervening community of Coaldale. Thus, some existing competition will be eliminated as a result of the proposed merger. However, it does not appear that the proposed transaction would substantially increase concentration in any relevant banking market. Although Pennsylvania Bank could legally establish de novo offices in Carbon County, the relatively small absolute size of Dime Bank and the existence of other potential entrants diminish the effect of the proposed merger on potential competition. Therefore, we conclude that the proposed transaction would not have a substantial competitive impact. PEOPLES NATIONAL BANK OF MONMOUTH COUNTY, HAZLET TOWNSHIP, N.J., MADISON TOWNSHIP, AND MADISON STATE BANK, N.J. Banking offices Name of bank and type of transaction Total assets In operation Madison State Bank, Madison Township, N.J., with and Peoples National Bank of Monmouth County, Hazlet Township, N.J. (4147), which had . . merged May 31, 1974, under charter of the latter bank (4147), and title "United Jersey Bank/ Mid State, National Association." The merged bank at date of merger had COMPTROLLER'S DECISION On January 22, 1974, Madison State Bank, Madison Township, N.J., and Peoples National Bank of Monmouth County, Hazlet Township, N.J., applied to the Comptroller of the Currency for permission to merge under the charter of the latter and with the title "United Jersey Bank/Mid State, National Association." Peoples National Bank of Monmouth County, the charter bank, was organized in 1889 and presently is a member of United Jersey Banks, Princeton, a registered bank holding company. With total assets of $66.6 million and IPC deposits of $41.1 million, the charter bank operates 11 branches from which it serves the northern portion of Monmouth County. The economy of that area is based on agriculture and recreational activity. Competition for the charter bank is provided by New Jersey National Bank, Trenton, with deposits of $485 million, which is a member of New Jersey 68 $ 9,895,881 72,047,509 83,449,286 To be operated 3 12 15 National Corporation; The Central Jersey Bank and Trust Company, Freehold Township, with deposits of $360 million; United Counties Trust Company, Elizabeth, with deposits of $329 million; Colonial First National Bank, Red Bank, with deposits of $294 million; Franklin State Bank, Franklin Township, with deposits of $202 million; and Community State Bank and Trust Company, Linden, with deposits of $103 million. Madison State Bank, the merging bank, was organized in 1968, became a member of United Jersey Banks in 1972, and presently, with total assets of $10.9 million and IPC deposits of $7.2 million, operates one branch office. The primary service area of the merging bank encompasses all of Madison Township, a largely residential area in which industrial development has not been encouraged. Competition for the merging bank is provided by The Central Jersey Bank and Trust Company, Freehold Township, with deposits of $360 million; Frank- lin State Bank, Franklin Township, with deposits of $202 million; The National Bank of New Jersey, New Brunswick, with deposits of $177 million, which is a member of Fidelity Union Bancorporation; First Charter National Bank, Monroe Township, with deposits of $129 million, which is a member of Heritage Bancorporation; Amboy-Madison National Bank, Madison Township, with deposits of $66 million; and Midlantic National Bank/Raritan Valley, Edison, with deposits of $51 million, which is a member of Midlantic Banks, Inc. Although the primary service areas of the charter and merging banks are adjacent, competition between the two banks is insignificant because of the distance between them and the existence of an adequate number of alternative banking facilities in the intervening area. The nearest offices of the two banks are located 7 miles apart. Consummation of the proposed merger will stimu- late competition in the service area of the merging bank because the resulting branches in Madison Township will offer new and improved services such as an increased lending limit and commercial and municipal loans. The resulting bank will remain the fourth largest of the nine banks headquartered in Monmouth County. Applying the statutory criteria, it is concluded that the proposed merger is in the public interest and this application is, therefore, approved. APRIL 25, 1974. SUMMARY OF REPORT BY ATTORNEY GENERAL The merging banks are both majority-owned subsidiaries of the same registered bank holding company. As such, their proposed merger is essentially a corporate reorganization and would have no effect on competition. THE NATIONAL BANK OF JACKSON, JACKSON, MICH., AND THE FARMERS STATE BANK OF CONCORD, CONCORD, MICH. Banking offices Total assets Name of bank and type of transaction In operation The Farmers State Bank of Concord, Concord, Mich., with and The National Bank of Jackson, Jackson, Mich. (13741), which had merged May 31, 1974, under charter and title of the latter bank (13741). The merged bank at date of merger had COMPTROLLER'S DECISION On January 27, 1974, The Farmers State Bank of Concord, Concord, Mich., and The National Bank of Jackson, Jackson, Mich., applied to the Comptroller of the Currency for permission to merge under the charter and with the title of the latter. The Farmers State Bank of Concord, the merging bank, was chartered in 1884 and operates as a unit institution. It has total assets of $7.1 million and IPC deposits of $6 million. The service area of the bank encompasses Concord and Pulaski townships and the western portions of Spring Arbor and Hanover townships, which are changing in nature from agricultural to rural-residential. Competitors of the merging bank include branches of City Bank and Trust Company, N.A., Jackson, with deposits of $171.3 million; several branches of Litchfield State Savings Bank, with deposits of $18.5 million; and Bank of Albion, with deposits of $9.1 million. % 7,553,765 172,221,639 179,775,404 To be operated 1 13 14 The National Bank of Jackson, the charter bank, was organized in 1933 and operates 12 branch offices with total assets of $166.9 million and IPC deposits of $119.3 million. The city of Jackson and the eastern and southeastern portions of Jackson County, which are becoming rural-residential in character, comprise the service area of the charter bank. The bank's major competitors include City Bank and Trust Company, Jackson, and The Midwest Bank, Jackson, with deposits of $23.5 million. Competition between the subject banks is minimal because their closest offices are separated by a distance of approximately 12 miles and their customer overlap is insignificant. Consummation of the proposed transaction will result in no adverse competitive effects. Rather, competition in the service area of the merging bank will be enhanced because improved and expanded services will be offered such as a larger lending limit, expertise in installment and mortgage lending, 69 and a credit card service. In addition, the merging bank's management succession problem will be resolved and the resulting bank will become a more effective competitor against the larger banks within its service area. Applying the statutory criteria, it is the opinion of this Office that the proposed transaction is in the public interest and will result in no adverse competitive effects. This application is, therefore, approved. APRIL 30, 1974. SUMMARY OF REPORT BY ATTORNEY GENERAL Bank is situated in the village of Concord (population 983) about 15 miles southwest of Applicant's nearest office. There is one competitive alternative in the intervening area. Thus, it appears that the proposed acquisition would eliminate some existing competition. Commercial banking in Jackson County is highly concentrated. Applicant, with approximately 43.4 percent of county deposits, ranks first among the county's eight commercial banks, while the two largest banks hold approximately 86.4 percent of total county deposits. The proposed acquisition will increase Applicant's share of county deposits to 45.4 percent and increase the share of the two largest banks from 86.4 percent to 88.4 percent. Thus, we conclude that the proposed transaction would eliminate some existing competition and increase banking concentration in Jackson County. FIRST NATIONAL STATE BANK OF OCEAN COUNTY, LAKEWOOD, N.J., OF THE JERSEY COAST, SPRING LAKE, AND FIRST NATIONAL STATE BANK N.J. Banking offices Name of bank and type of transaction Total assets In operation First National State Bank of Ocean County, Lakewood, N.J. (16035), with and First National State Bank of the Jersey Coast, Spring Lake, N.J. (13898), which had merged June 7, 1974, under charter and title of the latter bank (13898). The merged bank at date of merger had COMPTROLLER'S DECISION On November 13, 1973, First National State Bank of the Jersey Coast, Spring Lake, N.J., and First National State Bank of Ocean County, Lakewood, N.J., applied to the Comptroller of the Currency for permission to merge under the charter and title of the former. First National State Bank of the Jersey Coast, the charter bank, was organized in 1933, and presently, with assets of $34.9 million and IPC deposits of $28.1 million, operates two offices. It is a member of First National State Bancorporation, Newark, the third largest bank holding company in New Jersey. The charter bank is located in the Asbury Park market area of Monmouth County with its primary service area consisting of the municipalities of Spring Lake, Sea Girt, and Spring Lake Heights, a total population of 11,000. Twelve other banks compete with First National State Bank of the Jersey Coast in the Asbury Park market area. The most direct competition is provided by Central Jersey Bank and Trust, Freehold Township, with deposits of $354 million which is a 70 $44,837,737 37,317,025 82,605,008 To be operated 7 2 9 member of Central Bancorporation, and by First Merchants National Bank, Neptune Township, with deposits of $191 million. First National State Bank of Ocean County, the merging bank, was organized in 1934 and, with assets of $42.6 million and IPC deposits of $33.1 million, operates six offices in Ocean County. It is also affiliated with First National State Bancorporation, Newark. The merging bank is located in the Toms River market area of Ocean County and its primary service area includes a number of small municipalities with a total population of 170,000. Competition for the merging bank is provided by The First National Bank of Toms River, Toms River, with deposits of $111 million, which is a member of American Bancorporation; Ocean County National Bank, Point Pleasant, with deposits of $63 million; The Bank of Mid Jersey, Bordentown, with deposits of $54 million; Pineland State Bank, Bricktown, with deposits of $50 million; and three other smaller banks. There is minimal competition between the charter and merging banks because of the distance between them and the existence of four other banks in the intervening area. The closest offices of the charter and merging banks are 12 miles apart. Additionally, both First National State Bank of the Jersey Coast, and First National State Bank of Ocean County are wholly-owned subsidiaries of First National State Bancorporation, Newark. Applying the statutory criteria, it is concluded that the proposed merger is in the public interest and represents a reorganization of commonly-owned assets. This application is, therefore, approved. MARCH 6, SUMMARY OF REPORT BY ATTORNEY GENERAL Both First National State Bank of the Jersey Coast and First National State Bank of Ocean County are wholly-owned subsidiaries (except for directors' qualifying shares) of First National State Bancorporation, New Jersey's second largest multi-bank holding company. As such, their proposed merger is essentially a corporate reorganization and would have no effect on competition. 1974. THE NATIONAL BANK OF SOUTH CAROLINA OF SUMTER, SUMTER, S.C., AND THE FARMERS BANK, LORIS, S.C. Banking offices Total assets Name of bank and type of transaction In To be operation operated The Farmers Bank, Loris, S.C, with and The National Bank of South Carolina of Sumter, Sumter, S.C. (10660), which had merged June 10, 1974, under charter of the latter bank (10660) and title "The National Bank of South Carolina." The merged bank at date of merger had COMPTROLLER S DECISION On February 25, 1974, The Farmers Bank, Loris, S.C, and The National Bank of South Carolina of Sumter, Sumter, S.C, applied to the Comptroller of the Currency for permission to merge under the charter of the latter and with the title "The National Bank of South Carolina." The National Bank of South Carolina of Sumter, the charter bank, was organized in 1905 and presently operates nine branches. It has total assets of $87 million and IPC deposits of $67 million. The primary service area of the charter bank encompasses the central and east-central portions of South Carolina. The economic character of the area varies from predominantly agricultural in the Bishopville and Manning areas, to commercial, industrial, and governmental activities in Columbia, the State capital. Competition for the charter bank is provided by 17 other banks, the largest of which are South Carolina National Bank, Columbia, with deposits of $703 million; Citizens and Southern National Bank of South Carolina, Columbia, with deposits of $418 million; and First National Bank of South Carolina, Columbia, with deposits of $336 million. The Farmers Bank, Loris, S.C, the merging bank, was organized in 1919 and presently operates three branches. It has total assets of $18.1 million $ 16,784,082 97,918,723 114,702,805 4 10 14 and IPC deposits of $15.1 million. The primary service area of the merging bank encompasses northern Horry County. The economic character of that area ranges from predominantly agricultural, near Loris, to tourist and retirement oriented pursuits, in North Myrtle Beach. Competition for the merging bank is provided by many of the same large banks that compete with the acquiring bank. There is no competition between the charter and merging banks because a large distance separates them and an adequate number of alternative banking facilities operate in the intervening area. The closest offices of the two banks are 90 miles apart. Consummation of the proposed merger will stimulate competition in the service area of the merging bank because the resulting branches in Horry County will offer new and improved services such as a larger lending limit, commercial loans, payroll service, foreign credit information, a trust department, and a package of consumer services known as the Gold Key Account. In addition, consummation of the proposed merger will alleviate the management succession problem at The Farmers Bank. Applying the statutory criteria, it is concluded that the proposed merger is in the public interest and this application is, therefore, approved. MAY 6, 1974. 71 SUMMARY OF REPORT BY ATTORNEY GENERAL Neither bank operates an office in the areas served by the other. The nearest offices of the banks are separated by a distance of more than 80 miles. Therefore, the proposed transaction would not appear to eliminate substantial existing competition. Bank accounts for the third largest share of deposits (13.1 percent) held by the six banks operat- ing in Horry County. The State's largest and second largest banks rank first and second, respectively, in the county and account for over 54 percent of deposits. Under South Carolina law NBSC could branch de novo into Loris and Horry County; however, in view of the existence of a number of other potential entrants larger than NBSC, the proposed transaction would not appear to have a significantly adverse effect on potential competition. THE WYOMING NATIONAL BANK OF WILKES-BARRE, WILKES-BARRE, P A . , AND THE FIRST NATIONAL BANK OF FACTORYVILLE, FACTORYVILLE, PA. Banking offices Total assets Name of bank and type of transaction In To be operation operated The First National Bank of Factoryville, Factoryville, Pa. (9130), with and The Wyoming National Bank of Wilkes-Barre, Wilkes-Barre, Pa. (732), which had merged June 10, 1974, under charter and title of the latter bank (732). The merged bank at date of merger had COMPTROLLER'S DECISION On January 2, 1974, The First National Bank of Factoryville, Factoryville, Pa., and The Wyoming National Bank of Wilkes-Barre, Wilkes-Barre, Pa., applied to the Comptroller of the Currency for permission to merge under the charter and with the title of the latter. The First National Bank of Factoryville, the merging bank, was organized in 1908 and operates as a unit institution. It has total assets of $5.6 million and IPC deposits of $4.7 million. The service area of the bank encompasses Factoryville and the surrounding area within a 3-mile radius. The economy of the service area, which has a population of approximately 4,300, is dependent on agriculture and the Keystone Junior College. Competitors of the merging bank include a branch of First National Bank, Carbondale, which has deposits of $40.6 million and The First National Bank of Nicholson which has deposits of $14.6 million. The Wyoming National Bank of Wilkes-Barre, the charter bank, was established in 1829 and operates six branch offices. It has total assets of $128.3 million and IPC deposits of $109 million. The service area of the charter bank encompasses the northern two-thirds of Luzerne County, central Wyoming County, and Lackawanna County, an area which is dependent on industry and agriculture. Competitors of the charter bank include North- 72 $ 5,750,662 134,948,599 1 7 140,735,261 8 eastern Bank of Pennsylvania, with deposits of $383 million; First Valley Bank, with deposits of $320 million; United Penn Bank, with deposits of $318 million; and The First National Bank of Eastern Pennsylvania, with deposits of $304 million. Competition between the subject banks is insignificant since their closest offices are separated by a distance of approximately 10 miles and neither bank generates many accounts from the service area of the other. Consummation of the proposed transaction will result in no adverse competitive effects. Competition in the Factoryville area will be increased because the resulting bank will offer new and improved services, such as a larger lending limit, trust services, credit card services, automation services, free checking accounts, and higher interest rates on certificates of deposit. In addition, the management succession problem of the merging bank will be resolved. Applying the statutory criteria, it is the opinion of this Office that the proposed transaction is in the public interest and will result in no adverse competitive effects. This application is, therefore, approved. MAY 7, 1974. SUMMARY OF REPORT BY ATTORNEY GENERAL Wyoming Bank, with one office in Tunkhannock, Wyoming County, ranks second among the five banks with offices in that county. Factoryville Bank, located in Wyoming County on the Wyoming-Lackawanna County line in a community with a population of about 950, is situated 10 miles east of Wyoming Bank's Tunkhannock office and about 10 miles northwest of Scranton. Factoryville Bank ranks fifth among the five banks with offices in Wyoming County. Although the application indicates that neither bank draws substantial deposit or loan busi- ness from the immediate service area of the other, the Tunkhannock office of Wyoming Bank is one of the closest banking alternatives for customers in the service area of Factoryville Bank. Other alternatives are provided by banks to the southeast, toward the city of Scranton. We conclude that the proposed merger may eliminate some competition. DEPOSIT GUARANTY NATIONAL BANK, JACKSON, MISS., AND LEFLORE BANK & TRUST COMPANY, GREENWOOD, MISS. Banking offices Total assets Name of bank and type of transaction In operation Leflore Bank & Trust Company, Greenwood, Miss., with and Deposit Guaranty National Bank, Jackson, Miss. (15548), which had merged June 28, 1974, under charter and title of the latter bank (15548). The merged bank at date of merger had COMPTROLLER'S DECISION On December 13, 1973, Deposit Guaranty National Bank, Jackson, Miss., and Leflore Bank & Trust Company, Greenwood, Miss., applied to the Comptroller of the Currency for permission to merge under the charter and with the title of the former. Leflore Bank & Trust Company, Greenwood, Miss., the merging bank, was organized in 1944 and operates two branch offices in Greenwood. It has total assets of $16.7 million and IPC deposits of $12.9 million. The merging bank ranks next to last in size among the four banks headquartered in Greenwood and third among the five banks operating in Leflore County. Its growth has been slowed in recent years and it is in danger of being overtaken in size by what is now the smallest bank headquartered in Greenwood. Leflore Bank & Trust Company does not operate as a full-service bank and has a restricted lending limit which retards the banks efforts to obtain new business. The senior management of the merging bank is in poor health and past retirement age and the bank has been unable to attract competent successor management. In addition, the bank needs new or remodeled banking facilities. The service area of the merging bank encompasses Leflore County, a primarily agricultural area which has experienced a decline in population in recent years. The competitors for the bank include The Bank of Greenwood, with deposits of $32.5 million which is a branch of the $521 million First $ 17,544,879 775,645,596 789,457,648 To be operated 3 34 37 National Bank of Jackson; Bank of Commerce, with deposits of $15 million; and First National Bank of Greenwood, with deposits of $12.9 million. Deposit Guaranty National Bank, Jackson, Miss., the charter bank, was organized in 1925 and operates 30 branch offices within 100 miles of Jackson. With total assets of $691 million and IPC deposits of $392 million, the charter bank is the largest commercial bank in Mississippi. Deposit Guaranty National Bank operates as a full-service bank, employs an excellent management team, and conducts personnel programs to attract, train, and retain management personnel. The charter bank operates in the southern portion of Mississippi, the poorest State in the Nation. Competitors within its service area include First National Bank of Jackson, with deposits of $521.2 million; Hancock Bank, Gulfport, with deposits of $120.3 million; and First Mississippi National Bank, Hattiesburg, with deposits of $119.8 million. In addition, because the charter bank serves as a regional financial institution, it also competes with the largest banks located in Memphis, New Orleans, Baton Rouge, Mobile, Birmingham, and other cities in the South. Direct competition between the charter and merging banks is insignificant because their closest offices are separated by a distance of approximately 50 miles and each maintains only a minimal number of accounts in the service area of the other. De novo entry by the charter bank into Leflore 73 County is not an attractive alternative as Greenwood presently has an adequate number of banks. The only feasible means of entry into Leflore County by the charter bank is through merger. Leflore Bank & Trust Company is clearly an acceptable and legally available merger partner1 and its merger with Deposit Guaranty National Bank will allow the charter bank to begin operations in Leflore County with an unobjectionable volume of deposits and banking assets. When the subject merger is consummated, the charter bank's share of commercial bank deposits attributable to the State of Mississippi will not be increased to any significant degree. Accordingly, consummation of the proposed transaction will not result in any adverse competitive effects in any area. Rather, the entrance of the charter bank into Leflore County will increase competition because 1 United States v. Deposit Guaranty National Bank et al., (Civil No. 4311, March 21, 1974) new and expanded services will be offered by the resulting bank such as a larger lending capacity, emphasis on consumer loans, trust department services, increased expertise in agricultural financing, foreign department services, and petroleum department services. In addition, competent management personnel will be placed in the resulting branch office. Finally, in light of present operating difficulties of the merging bank, Deposit Guaranty National Bank will be able to expend the necessary time, manpower, and money to make its resulting branch in Greenwood a viable banking facility again. Applying the statutory criteria, it is the opinion of this Office that the proposed transaction is in the public interest and will result in no adverse competitive effects. This application is, therefore, approved. MAY 21, 1974. NOTE: NO Attorney General's Report received. THE NATIONAL BANK AND TRUST COMPANY OF NORWICH, NORWICH, N.Y., AND THE NATIONAL BANK OF HOBART, HOBART, N.Y. Banking offices Name of bank and type of Total assets transaction In operation The National Bank of Hobart, Hobart, N . Y . (4497), with and The National Bank and Trust Company of Norwich, Norwich, N . Y . (1354), which had . . . merged June 28, 1974, under charter and title of the latter bank (1354). The merged bank at date of merger had COMPTROLLER'S DECISION On March 26, 1974, The National Bank of Hobart, Hobart, N.Y., and The National Bank and Trust Company of Norwich, Norwich, N.Y., applied to the Comptroller of the Currency for permission to merge under the charter and with the title of the latter. The National Bank and Trust Company of Norwich, the charter bank, with assets of $139 million and IPC deposits of $111 million, was organized in 1856 and now operates 14 branch offices. The service area of the bank is primarily rural and extends throughout Chenango County, and portions of Tioga, Broome, Delaware, and Otsego counties. The charter bank is now the largest of the three banks headquartered in Chenango County. Competition is provided by numerous banks including offices of Marine Midland Bank-Southern, Elmira, with deposits of $295 million, which is a member of 74 $ 6,251,306 143,864,859 150,157,667 To be operated 1 14 15 Marine Midland Banks, Inc., a multi-bank holding company with total deposits of $6.6 billion; FirstCity National Bank of Binghamton, N.Y., with deposits of $206 million, which is a member of Lincoln First Banks, Inc., a multi-bank holding company with total deposits of $2.1 billion; Bankers Trust of Binghamton, with deposits of $25 million, which is a member of Bankers Trust New York Corporation, a multi-bank holding company with total deposits of $8.0 billion; and Endicott Bank of New York, with deposits of $51 million, which is a member of The Bank of New York Company, Inc., a multi-bank holding company with total deposits of $4.2 billion. The National Bank of Hobart, was organized in 1891 and still, with assets of $6 million and IPC deposits of $4.7 million, operates as a unit bank. The merging bank is located in Delaware County and its service area contains an estimated population of 5,000 persons. This bank ranks seventh of the 10 commercial banks headquartered in Delaware County. Competition is provided by The National Bank of Stamford with deposits of $16 million; The National Bank of Roxbury with deposits of $3 million; Deak National Bank, Fleischmanns, with deposits of $8 million, and The Delaware National Bank of Delhi, with deposits of $14 million. There is minimal competition between the charter and merging banks because their closest two offices are 14 miles apart and an adequate number of alternative banking facilities operate in this area. Consummation of the proposed merger will stimulate competition in the service area of the merging bank because the resulting branch in Hobart will provide residents and businesses, especially farmers, with new and improved services including a larger lending limit, an agricultural credit department, data processing and trust services, and a wider variety of mortgage and consumer loans, including a charge card. That will make the resulting branch in Hobart a more viable competitor within its service area. The resulting bank will remain the third largest commercial bank in the Seventh Banking District of New York. Applying the statutory criteria it is concluded that the proposed merger is in the public interest and this application is, therefore, approved. MAY 28, 1974. SUMMARY OF REPORT BY ATTORNEY GENERAL Eleven banks operate 15 offices in Delaware County (population 45,000). National Bank of Hobart is located in Hobart (population 531) in the eastern part of the county in an agricultural area. Norwich Bank also operates two offices in the eastern part of the county; one in Grand Gorge (population 600) about 12 road miles east of Hobart and one in Margaretville (population 816) about 31 road miles south of Hobart. In addition to the three offices of the merging banks, there are only three other competitive offices in the eastern part of the county. The proposed merger would thus appear to eliminate existing competition. Norwich Bank is the fourth largest bank in Delaware County, holding 13.2 percent of county deposits on June 30, 1973. The three largest banks held 44.6 percent of such deposits. National Bank of Hobart, the eighth largest bank, held 4.7 percent of such deposits. The proposed merger would give Norwich Bank the largest share, 17.9 percent, of county deposits, and 42.0 percent of deposits in the six banking offices in the eastern part of Delaware County. Although one office of a competing bank intervenes between the immediate service area of National Bank of Hobart and the closest office of Norwich Bank, we conclude that the proposed transaction would have an adverse competitive effect. REPUBLIC NATIONAL BANK OF NEW YORK, NEW YORK, N.Y., AND KINGS LAFAYETTE BANK, NEW YORK, N.Y., AND REPUBLIC BANK, NATIONAL ASSOCIATION, NEW YORK, N.Y. Name of bank and type of transaction Total assets Kings Lafayette Bank, New York, N.Y., with Republic National Bank of New York, New York, N.Y. (15569), with and Republic Bank, National Association, New York, N.Y. (15569), which had merged July 1, 1974, under charter of the latter bank (15569) and title "Republic National Bank of New York." The merged bank at date of merger had $224,190,575 565,630,656 965,000 COMPTROLLER'S DECISION On December 18, 1973, Kings Lafayette Bank, New York, N.Y., Republic National Bank of New York, New York, N.Y., and Republic Bank, National Association (organizing), New York, N.Y., applied to the Comptroller of the Currency for permission to merge under the charter of Republic Bank, National Association, and with the title "Republic National Bank of New York." 782,781,076 Banking offices In To be operation operated 19 2 0 19 Republic National Bank of New York, the first merging bank, was organized in 1966 and operates one branch in mid-Manhattan and one in London, England. It also owns and operates Republic National Bank of New York (International), Limited, a Nassau, Bahamas-based subsidiary. With total assets of $827.3 million and IPC deposits of $328 million, it ranks 14th among the 42 commercial banks headquartered in the Second Banking District. The service area of the bank includes the 75 Greater New York Metropolitan Area. International banking is the primary concern of Republic National Bank of New York. Competition for Republic National Bank of New York is principally provided by the multi-billion dollar New York banks, including the Chase Manhattan Bank (National Association), with deposits of $29.9 billion; First National City Bank, with deposits of $29.6 billion; Manufacturers Hanover Trust Company, with deposits of $15.2 billion; and Chemical Bank, with deposits of $12.9 billion. Kings Lafayette Bank, the second merging bank, was chartered in 1899 and operates 18 branch offices. With total assets of $231.4 million and IPC deposits of $173.3 million, it ranks fifth among the 32 commercial banks headquartered in the First Banking District. The service area of the bank is comprised of 14 separate segments of New York, Kings, Queens, and Suffolk County communities. Kings Lafayette Bank operates principally as a retail bank with emphasis on individual borrowers, real estate mortgages, and small businesses. Kings Lafayette Corporation, New York, N.Y., a one-bank holding company, owns controlling interest in the second merging bank. Competitors of Kings Lafayette Bank include the large banks located in New York City and also Marine Midland Tinker National Bank, East Setauket, which has deposits of $183 million and is a member of Marine Midland Banks, Inc.; Bankers Trust of Suffolk, N.A., Patchogue, which has deposits of $83 million and is a member of Bankers Trust New York Corporation; and Chemical Bank of Suffolk, National Association, Smithtown, which has deposits of $79 million and is a member of Chemical New York Corporation. Republic Bank, National Association, the charter bank, has been organized by Republic National Bank of New York and will be established as a wholly-owned subsidiary of Republic New York Corporation, a proposed bank holding company which was also organized by Republic National Bank 76 of New York. The charter bank will be used to provide a vehicle by which to transfer ownership of the merging banks to Republic New York Corporation. Prior to consummation of the proposed transaction, Republic New York Corporation, an organization incorporated under the laws of Maryland, will merge with Kings Lafayette Corporation. The charter bank will not be operating as a commercial bank prior to the proposed mergers. Although the service areas of the merging banks do overlap, in some degree competition between them is insignificant since they serve different segments of the banking community. In addition, the two banks are commonly controlled since the same shareholders own a controlling interest in each. Consummation of the proposed transaction will result in no adverse competitive effects. Rather, the resulting bank will be a stronger competitor because it will offer new and improved services such as a larger lending limit, consumer credit and mortgage lending, and international and trust department services. In addition, the management succession problem of Kings Lafayette Bank will be resolved. Applying the statutory criteria, it is the opinion of this Office that the proposed transaction is in the public interest and will result in no adverse competitive effects. This application is, therefore, approved. MAY 30, 1974. SUMMARY OF REPORT BY ATTORNEY GENERAL With the exception of its four offices in Suffolk County, all of Kings Bank's offices are located within 25 miles of Republic. The nearest branch is only a few blocks from Republic's headquarters. Thus, the proposed merger will eliminate existing competition between the parties in the New York City area. However, it does not appear that the transaction will substantially increase concentration in commercial banking in that area. Therefore, we conclude that the proposed merger would not have a substantial competitive impact. THE OKEY-VERNON NATIONAL BANK OF CORNING, CORNING, IOWA, AND FIRST STATE BANK, PRESCOTT, IOWA Banking offices Name of bank and type of transaction Total assets In To be operation operated First State Bank, Prescott, Iowa, with was purchased July 1, 1974, by The Okey-Vernon National Bank of Corning, Corning, Iowa (8725), which had After the purchase was effected, the receiving bank had COMPTROLLER S DECISION On October 19, 1973, The Okey-Vernon National Bank of Corning, Corning, Iowa, applied to the Comptroller of the Currency for permission to purchase the assets and assume the liabilities of The First National Bank of Prescott, Prescott, Iowa.* The Okey-Vernon National Bank of Corning, the purchasing bank, was organized in 1907 and since that time has operated as a unit institution. The bank has assets of $20.1 million and IPC deposits of $16.4 million. The service area of the bank includes the town of Corning and surrounding Adams County which has an estimated population of 6,300 persons. The economy of Corning and the peripheral rural area is predominantly agricultural where most of the available farmland is devoted to the raising of corn, soybeans, and hay. The purchasing bank is now the largest of two banks located in the town of Corning; it is in direct competition with The Bank of Brooks, a private bank, which has deposits of $2.5 million. The First National Bank of Prescott*, Prescott, Iowa, the selling bank, was organized in 1901 and since that time has operated as a unit institution. The bank now has assets of $3.4 million and IPC deposits of $2.5 million. The relevant service area of the selling bank is also Adams County and includes mainly the town of Prescott which has a population of 300 persons. Agriculture is the primary source of economic activity within the service area. Like the purchasing bank, the selling bank competes with The Bank of Brooks in Corning. It is also in competition with eight other banks located in communities around the perimeter of Adams County; the largest competitor is The First National Bank, Creston, with deposits of $20.9 million. There is no competition between the purchasing and selling institutions because their closest two offices are separated by a distance of 7 miles. Traditionally each bank has been content to limit banking * The First National Bank of Prescott, Prescott, Iowa, charter number 5912, converted to First State Bank, Prescott, Iowa, on June 28, 1974. $. 3,507,214 1 19,226,345 22,358,930 1 2 services to customers exclusively within their own territories. In addition, there are an adequate number of alternative banking facilities operating in the area. Consummation of the proposed purchase will provide the area now served by The First National Bank of Prescott with improved and expanded banking services, including an increased lending limit on farm loans to match the growth of consolidated farms in the area, access to computerized services, daily interest on savings accounts, tighter security for protection of banking records, and incorporation of younger management personnel to resolve the selling bank's succession problem. Also, the resulting bank would maintain the Prescott location as a branch, thereby affording existing customers the continuance of convenient banking service in that locale. Accordingly, it is the conclusion of this Office that the proposed transaction is in the public interest and this application is, therefore, approved. MARCH 5, 1974. SUMMARY OF REPORT BY ATTORNEY GENERAL Corning Bank operates its single office in Corning (population 2,095), the county seat of Adams County (population 6,332). On June 30, 1973, it held total deposits of $18.7 million (including IPC demand deposits of $8.5 million) and had loans amounting to $4.3 million. Prescott Bank, which, as of June 30, 1973, held total deposits of $3.1 million (including IPC demand deposits of $1.1 million) and had loans of $543,000 operates one office in Prescott (population 305), also in Adams County. Corning Bank and Prescott Bank are two of three banks in Adams County, Corning Bank being by far the largest. Significant competition probably does not exist between the two banks, in part due to extensive common ownership stemming from stock purchases in 1967. In view of the proximity of Corning and Prescott, it is likely that the instant transaction would permanently eliminate any independent competitive prospects of Prescott Bank. 77 THE FIRST NATIONAL BANK OF THE CITY OF SUPERIOR, SUPERIOR, W I S . , AND WISCONSIN STATE BANK, SUPERIOR, W I S . Total assets Name of bank and type of transaction Wisconsin State Bank, Superior, Wis., with was purchased July 15, 1974, by The First National Bank of the City of Superior, Superior, Wis. (3926), which had /•.•••• After the purchase was effected, the receiving bank had COMPTROLLER'S DECISION On April 9, 1973, The First National Bank of the City of Superior, Superior, Wis., applied to the Comptroller of the Currency for permission to purchase the assets and assume the liabilities of Wisconsin State Bank, Superior, Wis. The First National Bank of the City of Superior, the purchasing bank, was organized in 1887 and now, with assets of $25 million and IPC deposits of $21.7 million, operates as a unit bank. Marshall and Ilsley Bank Stock Corporation, Milwaukee, a multibank holding company, acquired the purchasing bank as a subsidiary in September 1970. The purchasing bank is located in the DuluthSuperior Metropolitan Area which has a population of approximately 265,000 persons. The economy of that area is based upon commercial and recreational activities with shipbuilding and the railroad industry comprising the most important sources of employment. Commercial banking in the Duluth-Superior Metropolitan Area is dominated by First American National Bank of Duluth and Northern City National Bank of Duluth, each of which is a subsidiary of a large Minneapolis-based holding company. The purchasing bank is the second largest commercial bank headquartered in Superior and competes directly with National Bank of Commerce in Superior, with total deposits of $34 million. Wisconsin State Bank, the selling bank, was organized in 1911 and now, with assets of $2.7 million and IPC deposits of $2.3 million, operates as a unit bank. The bank is a non-competitive institution as a result of ultra conservative policies imposed by the founding and controlling family. The selling bank is located in the small, primarily residential community known as South Superior adjacent to the city of Superior. The service area of the bank contains a population of approximately 3,100 persons and includes the small communities of Foxboro and Patzau. Although there is a slight overlap in the service areas of the purchasing and selling banks, there is 78 Banking offices In To be operation operated $ 2,826,119 1 29,355,056 32,215,967 1 2 little direct competition between the two banking institutions. Because of its very small size, the selling bank primarily deals in the personal accounts of the residents within its immediate service area. With a lending limit of only $28,000, the selling bank is unable to compete for large commercial loans. Consequently, substantial commercial accounts generrated from within the service area of Wisconsin State Bank are maintained with the larger downtown commercial banks which are capable of accommodating the credit needs of those businesses. Furthermore, the remaining subsidiaries of Marshall and Ilsely Bank Stock Corporation do not compete with Wisconsin State Bank because its next closest subsidiary bank is located in the city of Merrill, Wis., approximately 200 miles southeast of Superior. Consummation of the captioned proposal will allow the resulting branch in South Superior to become more responsive to the needs of its community by increasing the range of service it will offer including the introduction of trust services, international banking, automated accounting, personal investment and tax services, an expansion of consumer loan activity, and increased availability of real estate mortgage loans. The resulting bank will remain the second largest commercial bank in Superior with total deposits of approximately $27 million which will not cause an imbalance in the competitive banking structure in that city. Applying the statutory criteria, it is the conclusion of this Office that the proposed transaction is in the public interest and this application is, therefore, approved. AUGUST 2, 1974. SUMMARY OF REPORT BY ATTORNEY GENERAL First National Bank of the City of Superior ("FNB") is the second largest of five banks in Superior, Wis. As of December 31, 1972, FNB held total deposits of $23.2 million (including IPC demand deposits of $6.3 million) and total loans of $12.7 million. FNB, a unit bank, is a subsidiary of Marshall & Ilsley Corporation, a bank holding company with 15 banking subsidiaries which hold total deposits in excess of $764 million. Wisconsin State Bank ("WSB") is a unit bank also located in Superior, Wis. As of December 31, 1972, WSB held total deposits of $2.3 million (including IPC demand deposits of $1.1 million) and total loans of $420 thousand. The parties to this acquisition are situated about 4 miles apart with only one competitive alternative (situated one block from FNB) in the intervening area. Thus, it appears that the proposed acquisition would eliminate some existing competition in the highly concentrated Superior market. However, in view of the modest size of the bank to be acquired we conclude that the effect of the transaction on existing competition will not be significantly adverse. FIRST NATIONAL BANK OF SOMERSET COUNTY, BERLIN, PA., AND THE FIRST NATIONAL BANK OF CONFLUENCE, CONFLUENCE, PA. Banking offices Name of bank and type of transaction Total assets In operation First National Bank of Somerset County, Berlin, Pa. (5823), with and The First National Bank of Confluence, Confluence, Pa. (5307), which had consolidated July 29, 1974, under charter of the latter bank (5307) and title "National Bank of Western Pennsylvania." The consolidated bank at date of consolidation had COMPTROLLER S DECISION On January 21, 1974, The First National Bank of Confluence, Confluence, Pa., and First National Bank of Somerset County, Berlin, Pa., applied to the Comptroller of the Currency for permission to consolidate under the charter of the former and with the title "National Bank of Western Pennsylvania." First National Bank of Somerset County, the consolidating bank, was organized in 1901 and operates four branch offices in Somerset County. It has total assets of $13.8 million and IPC deposits of $12.3 million. The economy of Somerset County is dependent on agriculture, industry, coal mining, and recreation. Competitors of the consolidating bank include the Meyersdale branch of Gallatin National Bank, with total deposits of $206.2 million; the Somerset branch of State National Bank, with total deposits of $185.8 million; several branches of Johnstown Bank and Trust Company, with total deposits of $83.3 million; and Somerset Trust Company, with total deposits of $26.3 million. The First National Bank of Confluence, the charter bank, was organized in 1900 and operates two branch offices in the south and southeastern parts of Fayette County. It has total assets of $19.4 million and IPC deposits of $15.6 million. Mining, agriculture, lumbering, and recreation support the economy of its service area. The closest competitors $22,416,787 15,188,669 To be operated 5 3 37,605,457 8 of the charter bank are branches of Gallatin National Bank and the Donegal branch of County Trust Company, which has deposits of $19.2 million. Competition between the subject banks is minimal since their closest offices are separated by a distance of approximately 20 miles; the intervening mountainous area forms a natural boundary separating the service areas of the two banks. Consummation of the proposed transaction will result in no adverse competitive effects. Rather, the resulting bank will become a stronger competitor by offering new and expanded services such as an increased lending limit, trust department services, and automated bookkeeping. In addition, the management succession problems of the charter bank will be resolved. Applying the statutory criteria, it is the opinion of this Office that the proposed transaction is in the public interest and will result in no adverse competitive effects. This application is, therefore, approved. JUNE 14, 1974. SUMMARY OF REPORT BY ATTORNEY GENERAL Somerset Bank and Confluence Bank are headquartered about 33 miles apart and the nearest offices of the two banks are about 20 miles apart with no banking offices intervening. Thus, it appears that 79 the proposed acquisition would eliminate only a limited amount of existing competition. And in view of the modest size of the parties and the existence of several significant potential entrants into their markets, we conclude that the proposed transaction would not eliminate substantial potential competition. Therefore, we conclude that the proposed transaction would not have a substantial competitive impact. THE FIRST NATIONAL BANK OF SAN JOSE, SAN JOSE, CALIF., AND HAYWARD NATIONAL BANK, HAYWARD, CALIF. Banking offices Total assets Name of bank and type of transaction In operation Hayward National Bank, Hayward, Calif. (15343), with and The First National Bank of San Jose, San Jose, Calif. (2158), which had merged July 31, 1974, under charter and title of the latter bank (2158). The merged bank at date of merger had COMPTROLLER S DECISION On February 13, 1974, Hayward National Bank, Hayward, Calif., and The First National Bank of San Jose, San Jose, Calif., applied to the Comptroller of the Currency for permission to merge under the charter and with the title of the latter. Hayward National Bank, the merging bank, with total assets of $15.4 million and IPC deposits of $11.1 million, was organized in 1964 and operates as a unit institution. The service area of the bank encompasses the city of Hayward and a small portion of the city of Castro Valley. The area is primarily residential in nature but does contain some commercial activity and light industry. Competitors of the merging bank include branches of Bank of America, National Trust and Savings Association, with deposits of $35.6 billion; branches of Security Pacific National Bank, with deposits of $11.3 billion; and branches of Crocker Bank, N.A., with deposits of $6.5 billion. The First National Bank of San Jose, the charter bank, was organized in 1874, operates 29 branch offices, and has an application pending for one additional branch. It has total assets of $270 million and IPC deposits of $225.4 million. The service area of the bank encompasses Santa Clara County, a small portion of San Mateo County, and a portion of southwestern Alameda County. That area, which is experiencing rapid residential and commercial development, is primarily dependent on industry, agriculture, food processing, and related agricultural businesses. Competitors of the charter bank include branches of the Bank of America, National Trust and Savings Association; Crocker Bank, N.A.; and Bank of 80 $ 16,876,039 283,984,707 To be operated 1 33 300,860,747 34 California, National Association, with deposits of $2.1 billion. While the service areas of the subject banks do overlap to a small degree, competition between them is insignificant as their service areas are generally considered separate and distinct banking communities. Several large banks have established branches that provide adequate banking alternatives in both areas. In addition, access between the service areas of the two banks is limited by the Nimitz Freeway. Consummation of the proposed transaction will result in no adverse competitive effects. Rather, competition will be enhanced, particularly in the service area of the merging bank, by the existence of a stronger management and by the establishment of new and expanded services such as a greater lending limit, trust department services, retail banking services, electronic data processing services, and commodity loans and warehouse receipt financing. Applying the statutory criteria, it is the opinion of this Office that the proposed transaction is in the public interest and will result in no adverse competitive effects. This application is, therefore, approved. JUNE 20, 1974. SUMMARY OF REPORT BY ATTORNEY GENERAL Hayward is located in western Alameda County about 17 miles southeast of Oakland. Applicant's two Alameda County branches, located in San Leandro and San Lorenzo, lie northwest of Hayward between Hayward and Oakland about 8 and 2.5 miles, respectively, from Bank. Thus, it appears that the proposed acquisition may eliminate some existing competition between the parties. However, it does not appear that the transaction would substantially increase concentration in any relevant banking market. Accordingly, we conclude that the proposed merger would not have a substantial competitive impact. THE FIRST JERSEY NATIONAL BANK, JERSEY CITY, N.J., AND BELMAR-WALL NATIONAL BANK, WALL TOWNSHIP, N.J. Banking offices Total assets Name of bank and type of transaction In operation Belmar-Wall National Bank, Wall Township, N.J. (13848), with and The First Jersey National Bank, Jersey City, N.J. (374), which had merged Aug. 2, 1974, under charter and title of the latter bank (374). The merged bank at date of merger had COMPTROLLER'S DECISION On April 8, 1974, Belmar-Wall National Bank, Wall Township, N.J., and The First Jersey National Bank, Jersey City, N.J., applied to the Comptroller of the Currency for permission to merge under the charter and with the title of the latter. Belmar-Wall National Bank, the merging bank, was organized in 1933. It now operates four branch offices and has received approval to open an additional branch. With total assets of $56 million and IPC deposits of $40.8 million, the bank ranks fifth in size among the nine commercial banks headquartered in Monmouth County. The service area of the bank encompasses portions of Monmouth and Ocean counties, a residential area with a population of at least 26,000 persons. Competitors of the merging bank include The Central Jersey Bank and Trust Co., Freehold, with deposits of $360 million; Colonial First National Bank, Red Bank, with deposits of $294 million; First Merchants National Bank, Neptune, with deposits of $197 million; and Peoples National Bank of Monmouth County, Hazlet, with deposits of $57 million, which is a member of United Jersey Banks. The First Jersey National Bank, the charter bank, was organized in 1894. This bank operates 22 branch offices and has received approval to operate a branch in Cliffside Park. It has applied for approval to open a branch in Union Township. With total assets of $534.5 million and IPC deposits of $399.5 million, the bank ranks first in size among the 11 commercial banks headquartered in Hudson County. The service area of the charter bank encompasses Hudson County, the southern portion of Bergen County, the city of Newark, and the town $ 56,959,716 486,446,643 To be operated 5 20 543,281,539 25 ship of Millburn, an area which is industrial in nature. The major competitors of the charter bank include Commercial Trust Co., Jersey City, with deposits of $224 million; The Trust Co. of New Jersey, Jersey City, with deposits of $233 million; and Garden State National Bank, Hackensack, with deposits of $426 million. Competition between the subject banks is insignificant as they are separated by a distance of more than 50 miles and each serves separate and distinct areas. Consummation of the proposed transaction will result in no adverse competitive effects. The resulting bank will better serve the needs of the customers of the merging bank by providing expanded and improved services, such as accounts receivable financing, trust department services, data processing services, and international services. Applying the statutory criteria, it is the opinion of this Office that the proposed transaction is in the public interest and will result in no adverse competitive effects. This application is, therefore, approved. JULY 1, 1974. SUMMARY OF REPORT BY ATTORNEY GENERAL The nearest offices of the parties are separated by approximately 40 miles, with a number of competitive alternatives in the intervening area. Thus, while First Jersey may derive some deposits and loans from Monmouth County, it does not appear that the proposed merger would eliminate substantial existing competition. And although First Jersey could legally expand de novo into the area served by Bank, the existence of other potential entrants and the 81 latter's relatively modest market position diminish the effect of the proposed merger on potential competition. THE COUNTY BANK, N.A., Therefore, we conclude that this proposed transaction would not have a substantial competitive impact. CAMBRIDGE, MASS., AND LEXINGTON TRUST COMPANY, LEXINGTON, MASS. Banking offices Total assets Name of bank and type of transaction In operation Lexington Trust Company, Lexington, Mass., with and The County Bank, N.A., Cambridge, Mass. (4771), which had consolidated Aug. 16, 1974, under charter and title of the latter bank (4771). The consolidated bank at date of consolidation had COMPTROLLER'S DECISION On April 8, 1974, Lexington Trust Company, Lexington, Mass., and The County Bank, N.A., Cambridge, Mass., applied to the Comptroller of the Currency for permission to consolidate under the charter and with the title of the latter. Lexington Trust Company, the consolidating bank, was organized in 1914 and now operates six branch offices. It has total assets of $49.8 million and IPC deposits of $37 million. The communities of Lexington, Bellerica, Chelmsford, Westford, Acton, Burlington, and Bedford comprise the service area of the consolidating bank. That area, which has a population of approximately 156,000, is primarily residential. Competitors of the consolidating bank in Lexington include Harvard Trust Company, with deposits of $210.8 million; Coolidge Bank and Trust Company, with deposits of $94.9 million; and Lexington Savings Bank, with deposits of $52.8 million. The County Bank, N.A., Cambridge, Mass., the charter bank, was organized in 1933 and now operates eight branch offices. It has total assets of $121.8 million and IPC deposits of $91.2 million. The service area of the charter bank includes the communities of Cambridge, Everett, Somerville, Maiden, and Belmont. That area, which has a population of 82 To be operated $ 45,408,250 111,756,697 157,164,947 16 approximately 316,000, is residential and industrial in nature. Competitors of the charter bank include Cambridge Savings Bank, with deposits of $262.9 million; Harvard Trust Company; Cambridgeport Savings Bank, with deposits of $174.9 million; and Coolidge Bank and Trust Company. Competition between the subject banks is minimal since they are both majority-owned subsidiaries of Shawmut Association, Inc., Boston, Mass. Consummation of the proposed transaction will result in no adverse competitive effects rather, the resulting bank will become a stronger competitor because of its increased lending limit, capable personnel, credit department services, and aggressive policies in the areas of loans and deposits. Applying the statutory criteria, it is the conclusion of this Office that the proposed transaction is in the public interest and will result in no adverse competitive effects. This application is, therefore, approved. JUNE 27, 1974. SUMMARY OF REPORT BY ATTORNEY GENERAL County Bank and Lexington Trust are both subsidiaries of Shawmut Association, Inc., a registered bank holding company. As such, their proposed consolidation is essentially a corporate reorganization and would have no competitive impact. WELLS FARGO BANK, NATIONAL ASSOCIATION, SAN FRANCISCO, CALIF., AND COMMERCIAL NATIONAL BANK, ORANGE COUNTY (P.O. BUENA PARK), CALIF. Banking offices Total assets Name of bank and type of transaction In operation Commercial National Bank, Orange County (P.O. Buena Park), Calif. (15434), with $ 33,069,076 9,819,837,927 and Wells Fargo Bank, National Association, San Francisco, Calif. (15660), which had merged Aug. 23,1974, under charter and title of the latter bank (15660). The merged bank at date of merger had 9,852,907,003 COMPTROLLER'S DECISION On April 10, 1974, Wells Fargo Bank, National Association, San Francisco, Calif., and Commercial National Bank, Orange County, Calif., applied to the Comptroller of the Currency for permission to merge under charter and title of the former. Wells Fargo Bank, National Association, the charter bank, was founded in 1862 and now has assets of $11.6 billion and IPC deposits of $6 billion. It operates 303 offices throughout the State of California, four of which are located in Orange County and account for $40.9 million of the bank's total deposits. Commercial National Bank, Orange County, the merging bank, organized in 1964, has $31.6 million in assets and IPC deposits of $24.1 million. It operates seven offices in Orange County, an area with an estimated population of 1.6 million. Competition in Orange County is provided by branches of eight major banks and numerous smaller banks. The largest banks include Bank of America, N.T. & S.A., with total deposits of $1 billion in Orange County, and Security Pacific National Bank, with total Orange County deposits of $567.5 million. Those two banks dominate the banking industry in Orange County. There is minimal competition between the merging bank and the charter bank. The merging bank is primarily retail with a heavy emphasis on consumer credit loans while the charter bank has more of a commercial emphasis. Both banks operate branches in Santa Ana and Anaheim, but competition is minimal due to other factors. In Santa Ana, the offices are 5 miles apart, separated by a business district containing 12 other banking offices. In Anaheim, although the branches are 2 miles apart, direct competition is provided by two offices of Bank of America, one located in the same shopping center as Commercial National Bank, the other To be operated 7 311 318 directly across the street from the Wells Fargo branch. Consummation of the proposed transaction will not result in a decrease of banking alternatives in the service area nor will it result in an undue increase in size of the charter bank. Competition in the area will be stimulated by assuring a succession of capable management in the merging bank. The resulting bank will offer improved services, such as escrow and trust services, international banking, electronic data processing services, a credit card, and an expansion of real estate and commercial loans. Applying the statutory criteria, it is concluded that the proposed merger is in the public interest and the application is, therefore, approved. JULY 8, 1974. SUMMARY OF REPORT BY ATTORNEY GENERAL The effects of this proposed merger will be felt primarily in Orange County in Southern California. Wells Fargo operates four branches in Orange County and, with total deposits of $29.6 million, accounts for less than 1 percent of total deposits held by Orange County banking offices. CNB, with all seven of its banking offices located in that county, also accounts for less than 1 percent of total county deposits. In view of the relatively close proximity of the parties' offices, particularly in Santa Ana and Anaheim, it appears that the proposed merger may eliminate some existing competition in Orange County. However, it does not appear that concentration in commercial banking would be substantially increased in any relevant banking market. Although Wells Fargo possesses the capability to expand its present Orange County operations de novo, the modest market position held by CNB in Orange County diminishes the effects of this proposed transaction on potential competition. Therefore, we conclude that the proposed merger would not have a substantial competitive impact. 83 THE TOY NATIONAL BANK OF SIOUX CITY, SIOUX CITY, IOWA, AND FARMERS LOAN & TRUST COMPANY, SIOUX CITY, IOWA Banking offices Total assets Name of bank and type of transaction In operation Farmers Loan & Trust Company, Sioux City, Iowa, with and The Toy National Bank of Sioux City, Sioux City, Iowa (10139), which had merged Sept. 16, 1974, under charter of the latter bank (10139) and title "The Toy National Bank." The merged bank at date of merger had COMPTROLLER'S DECISION On April 22, 1974, Farmers Loan & Trust Company, Sioux City, Iowa, and The Toy National Bank of Sioux City, Sioux City, Iowa, applied to the Comptroller of the Currency for permission to merge under the charter of the latter and with the title of "The Toy National Bank." Farmers Loan & Trust Company, the merging bank, is a noninsured institution which was chartered in 1883 as an Iowa trust company. It has total assets of $841 thousand and IPC deposits of $542 thousand. The service area of the merging bank encompasses Sioux City; Sergeant Bluff, Iowa; North Sioux City, S. Dak.; and South Sioux City, Nebr. That area, which has a population of 96,915, is industrial, agricultural, and residential in nature. Competitors for the charter bank include Security National Bank, Sioux City, with deposits of $106.9 million, and First National Bank in Sioux City, with deposits of $86.7 million. The Toy National Bank of Sioux City, the charter bank, was organized in 1912 and now operates three walk-in, drive-in facilities. The bank has total assets of $90.1 million and IPC deposits of $55.4 million. The service area of the merging bank is identical to that of the charter bank. Competitors of the merging bank include Security National Bank; First National Bank in Sioux City; and Northwestern National Bank of Sioux City, with deposits of $56.3 million. Competition between the subject banks is minimal as, in many respects, they have been operating as one institution. They share common stockholders, many of whom are grandchildren of the founder of the banks; common directors, officers, and employees; and have always been located in the same building. In addition, in 1952 the desire to obtain new trust business led to the decision to expand the trust department of the charter bank, rather than 84 $ 375,066 95,337,656 To be operated 1 3 93,805,519 3 that of the merging bank, because the former bank was deemed to be more familiar to the general public. The consequent advertising campaign was apparently successful, as seen in the decline in assets of the merging bank and the increase in trust assets of the charter bank. The merging bank has since been used principally to administer family trusts. Consummation of the proposed transaction will result in no adverse competitive effects. Under Iowa law, the charter of the merging bank, which expires in 1983, cannot be renewed. This merger, therefore, represents a more convenient and efficient manner than liquidation by which to eliminate the merging bank. In addition, the public will be benefitted by the increased operating efficiency of the resulting bank and by its increased lending limit. Applying the statutory criteria, it is the opinion of this Office that the proposed transaction is in the public interest and will result in no adverse competitive effects. This application is, therefore, approved. AUGUST 12, 1974. SUMMARY OF REPORT BY ATTORNEY GENERAL According to the application, both institutions share the same quarters, and employees and officers of one have simultaneously done work as employees and officers of the other. The application also states that since a 1952 decision to enlarge the trust department of Bank, the principal use of Farmers Trust has been to administer family trusts. Under Iowa law, the charter of Farmers Trust, one of two remaining trust companies in Iowa, will expire in 1983, and cannot be renewed. We do not believe that the proposed transaction would have any significant adverse competitive effects. MICHIGAN NATIONAL BANK OF MACOMB, WARREN, MICH., AND TRI-CITY BANK, WARREN, MICH. Banking' offices Name of bank and type of transaction Tri-City Bank, Warren, Mich., with was purchased Sept. 28, 1974, by Michigan National which had After the purchase was effected t h e receiving b a n k . Bank of M a c o m b , W a r r e n , Mich. (16387), had. COMPTROLLER S DECISION On September 27, 1974, request was made to the Comptroller of the Currency for prior written approval for The Michigan National Bank of Macomb, Warren, Mich. ("Assuming Bank"), to purchase certain of the assets and assume certain of the liabilities of the Tri-City Bank, Warren, Mich. ("Tri-City"). As of business on September 27, 1974, Tri-City was a State bank with one office and deposits of approximately $14 million. On September 27, 1974, the Federal Deposit Insurance Corporation ("FDIC") was appointed as receiver of Tri-City. The present application is based upon an agreement, which is incorporated herein by reference, by which the FDIC as receiver has agreed to transfer certain TriCity assets and liabilities to the Assuming Bank. For the reasons stated hereafter, the Assuming Bank's application is approved, and the purchase and assumption transaction may be consummated immediately. Tri-City was organized in 1958, and has total book resources of approximately $17 million. It operated one office in Warren, Mich. Under the Bank Merger Act, 12 U.S.C. 1828(c), the Comptroller cannot approve a purchase and assumption transaction which would have certain proscribed anticompetitive effects unless he finds those anticompetitive effects to be clearly outweighed in the public interest by the probable effect of the transaction in meeting the convenience and needs of the community to be served. Additionally, the Comptroller is directed to consider the financial and managerial resources and future prospects of the existing and proposed institution, and the convenience and needs of the community to be served. When necessary, however, to prevent the evils attendant upon the failure of a bank, the Comptroller can dispense with the uniform standards applicable to usual acquisition transactions, and Total assets . ... In To be operation operated $16,634,720 1 1,500,000 16,349,403 0 . 1 need not consider reports on the competitive consequences of the transaction ordinarily solicited from the Department of Justice and other banking agencies. He is authorized in such circumstances to act immediately in his sole discretion, to approve an acquisition, and to authorize the immediate consummation of the transaction. The proposed acquisition will prevent a disruption to the community and potential losses to a number of uninsured depositors. The Assuming Bank is supported by strong financial and managerial resources. Thus, the approval of this transaction will help to avert a loss of public confidence in the banking system, and may actually improve the services offered to the banking public. The Comptroller thus finds that the proposed transaction will not result in a monopoly, be in furtherance of any combination or conspiracy to monopolize or attempt to monopolize the business of banking in any part of the United States; and that the anticompetitive effects of the proposed transaction, if any, are clearly outweighed in the public interest by the probable effect of the proposed transaction in meeting the convenience and needs of the community to be served. For those reasons, the Assuming Bank's application to assume certain liabilities and purchase certain assets of Tri-City as set forth in the agreement executed with the FDIC as receiver, is approved. The Comptroller further finds that the failure of Tri-City requires him to act immediately, as contemplated by the Bank Merger Act, to prevent disruption of banking services to the community; and the Comptroller thus waives publication of notice, dispenses with the soli citation of competitive reports from other agencies, and authorizes the transaction to be consummated immediately. SEPTEMBER 28, 1974. NOTE: Due to the emergency nature of the situation, no report on competitive factors was requested. 85 CUMBERLAND COUNTY NATIONAL BANK AND TRUST COMPANY, N E W CUMBERLAND, PA., AND THE DUNCANNON NATIONAL BANK, DUNCANNON, PA. Banking offices Total assets Name of bank and type of transaction In operation The Duncannon National Bank, Duncannon, Pa. (4142), with and Cumberland County National Bank and Trust Company, New Cumberland, Pa. (14542), which had merged Sept. 30, 1974, under charter and title of the latter bank (14542). The merged bank at date of merger had COMPTROLLER'S DECISION On May 7, 1974, the Duncannon National Bank, Duncannon, Pa., and Cumberland County National Bank and Trust Company, New Cumberland, Pa., applied to the Comptroller of the Currency for permission to merge under the charter and title of the latter. Cumberland County National Bank and Trust Company, the charter bank, is headquartered in New Cumberland, Cumberland County, Pa. With 17 operating offices and assets of $196.5 million and $143 million in IPC deposits, the charter bank is the sixth largest bank in its service area. That service area consists of the eastern half of Cumberland County, southwestern Dauphin County, east-central Adams County, northern York County, and a small part of northeastern Perry County. The economy of that area is supported by a wide variety of medium and light industry, governmental bodies, military installations, service organizations, and agriculture. The unemployment rate in the area is low. Principal competitors for charter bank include National Central Bank, Lancaster, with $763 million in deposits; The Commonwealth National Bank, Harrisburg, with $489 million in deposits; Dauphin Deposit Trust Company, Harrisburg, with $335 million in deposits, The Fulton National Bank, Lancaster, with $206 million in deposits; and Pennsylvania National Bank and Trust Co., Pottsville, with $183 million in deposits. The Duncannon National Bank, the merging bank, is a small unit bank with assets of $10.9 million and IPC deposits of $8.4 million. The bank is situated in Duncannon, Pa., about 15 miles north of New Cumberland. Its service area, which includes a very small portion of eastern Perry County and extreme western Dauphin County, has an economy completely dependent upon agriculture. Primary competitors of merging bank are the First National Bank of Marysville, Marysville, with $7 million in deposits and a branch of Commonwealth 86 $ 10,887,945 1 225,799,364 17 To be operated 236,687,309 18 National Bank located in New Bloomfield. The merging bank is a small unaggressive institution lacking in managerial depth. The nearest offices of the charter bank to the merging bank are 9 miles north, in Newport, and 10 miles south, in Enola, with an adequate number of alternate institutions in the intervening areas. While distance alone precludes any competition between the applicant banks, the nonaggressive nature of the merging bank further reduces the possibility of competition between the two banks. As a result of the merger, customers in the merging bank's service area will benefit from more efficient banking services and larger loan limits which will serve to stimulate competition in that area. Applying the statutory criteria, it is concluded that the proposed merger is in the public interest and this application is, therefore, approved. AUGUST 22, 1974. SUMMARY OF REPORT BY ATTORNEY GENERAL Applicant and Bank are headquartered about 18 miles apart, and their nearest offices are separated by about 10 miles. Applicant's Perry County office, located on the eastern border of the county along the Susquehanna River, is about 10 miles northwest of Bank, with no competitive alternatives in the intervening area. Applicant's Enola office, in the northeastern corner of Cumberland County, is located about 10 miles south of Bank, just below the Perry County line. Thus, it appears that the proposed transaction would eliminate existing competition between the parties, particularly in eastern Perry County. Bank, with approximately 17 percent of Perry County deposits, is the second largest of the nine banks with offices in the county. Applicant, with approximately 7.2 percent of Perry County deposits, ranks seventh. If consummated, this transaction will rank Applicant first among Perry County banks with nearly 25 percent of total county deposits, with an even greater share of deposits in the eastern portion of the county. We conclude that the proposed merger would eliminate substantial existing competition and significantly increase concentration in commercial banking in Perry County. FIRST NATIONAL BANK OF ABERDEEN, ABERDEEN, S. DAK., AND THE FIRST NATIONAL BANK IN BRISTOL, BRISTOL, S. DAK. Banking offices Name of bank and type of transaction Total assets To be In operation operated The First National Bank in Bristol, Bristol, S. Dak. (10868), with and First National Bank of Aberdeen, Aberdeen, S. Dak. (2980), which had merged Oct. 1, 1974, under charter and title of the latter bank (2980). The merged bank at date of merger had COMPTROLLER'S DECISION On May 23, 1974, The First National Bank in Bristol, Bristol, S. Dak., and First National Bank of Aberdeen, Aberdeen, S. Dak., applied to the Comptroller of the Currency for permission to merge under the charter and with the title of the latter. The First National Bank in Bristol, the merging bank, was organized in 1916 and now operates only one banking office with assets of $5.8 million and IPC deposits of $4.8 million. The merging bank is located in Day County which encompasses virtually all of the bank's service area. Day County, with an estimated population of 9,000 persons, is supported largely by diversified farming, livestock, and some milk production. The bank has no local competition and very little competition is provided by the other three banks and two branches within the county. Whatever marginal competition it does experience is provided by Security Bank and Trust Company, Webster, with deposits of $13.7 million, which is a member of Dacotah Bank Holding Company; State Bank of Waubay, with deposits of $4.3 million; and First State Bank of Pierpont, with deposits of $3.2 million. First National Bank of Aberdeen, the charter bank, was organized in 1881 and now operates seven branch offices with total assets of $171.1 million and IPC deposits of $135.2 million. The service area of the bank is also localized and consists almost exclusively of Brown County, which has approximately 37,000 inhabitants, and, more specifically, the city of Aberdeen, which contains approximately 26,000 persons. The service area of the charter bank is $ 6,430,772 180,284,114 186,714,886 1 8 9 located in the northeast corner of South Dakota and, like Day County, it relies heavily upon diversified agriculture for its economic base. Up to this time industrial development has been minimal. The charter bank is offered competition on a local level by two other banks and one branch including the main office and a local branch of Aberdeen National Bank, with deposits of $45.8 million, and Farmers and Merchants Bank and Trust Company, Aberdeen, with deposits of $21.9 million. Three other banks and two branch offices of Aberdeen National Bank provide nominal competition in the surrounding county. The major owner of the charter bank is Northwest Bancorporation, with total deposits of $5.2 billion, a large regional bank holding company based in Minneapolis. The banking facility closest to the merging bank owned by that holding company is the branch of the charter bank located at Groton, 22 miles west of Bristol. The applicant banks do not compete. A survey of customer accounts in April 1974 revealed that there was virtually no geographical overlap between the service areas of the two banks and that there exists only an insignificant number of common customers. No imbalance in the existing banking structure will result from this merger in the area surrounding the merging bank because of the small size of the merging bank, as well as the extremely small size of its service area. The proposed merger is quite possibly the only solution to a crisis in management succession at the merging bank. Moreover, consummation of the proposed merger will stimulate competition and foster 87 economic growth within the service area of the merging bank because that bank has heretofore been conservative in its loan policy while the charter bank is considered to be very aggressive in that phase of banking. It will also bring a significantly larger lending limit to a region where the size of farm debt has been rapidly increasing. Other benefits that will accrue to customers of the resulting bank in Bristol are a full line of trust services, the availability of expert agricultural advice, student loans, and special checking accounts. Applying the statutory criteria it is concluded that the proposed merger is in the public interest and this application is, therefore, approved. AUGUST 20, 1974. SUMMARY OF REPORT BY ATTORNEY GENERAL Bristol is located some 42 miles east of Aberdeen. The office of Aberdeen Bank nearest Bristol Bank is in Groton, Brown County, about 22 miles west of Bristol, with no banking offices directly intervening. The application indicates that the service areas of the banks adjoin and to some extent overlap in the areas nearest the Brown-Day County boundary. The proposed merger would, therefore, eliminate a limited amount of existing competition but would not appear to significantly increase concentration in banking in any relevant geographic area. We conclude that the competitive effect of this transaction would not be significantly adverse. NATIONAL BANK OF MISSISSIPPI, STARKVILLE, MISS., AND THE NATIONAL BANK OF COMMERCE OF COLUMBUS, COLUMBUS, MISS. Banking offices Name of bank and type of transaction Total assets In operation The National Bank of Commerce of Columbus, Columbus, Miss. (10361), with and National Bank of Mississippi, Starkville, Miss. (3656), which had consolidated Oct. 1, 1974, under charter of the latter bank (3656) and title "National Bank of Commerce of Mississippi." The consolidated bank at date of consolidation had COMPTROLLER'S DECISION On July 1, 1974, National Bank of Mississippi, Starkville, Miss., and The National Bank of Commerce of Columbus, Columbus, Miss., applied to the Comptroller of the Currency for permission to consolidate under the charter of the former and with the title of "National Bank of Commerce of Mississippi." National Bank of Mississippi, the charter bank, was organized in 1889 and is headquartered in Starkville in Oktibbeha County which is in northeastern Mississippi. With IPC deposits of $41 million, the charter bank operates two branches in Starkville and operates offices in Maben, Aberdeen, Amory, and Hamilton. Charter bank serves two distinct service areas, Oktibbeha County along with small portions of eastern Webster, northeastern Choctaw, and southwestern Clay counties, and Monroe County. Direct competitors of the charter bank in the Oktibbeha County service area include Security State Bank, Starkville, with deposits of $36 million; Merchants and Farmers Bank, Kosciusko, with deposits of $36 million; Bank of Mantee, Mantee, 88 $38,611,251 57,810,852 96,422,102 To be operated 6 8 14 with deposits of $6 million; and Grenada Bank, Grenada, located in Eupora and Ackerman, with deposits of $149 million. There is additional competition provided by other banks in peripheral areas. Competitors of the charter bank in the Monroe County service area include Monroe Banking and Trust Company, Aberdeen, with deposits of $15 million; Bank of Amory, Amory, with deposits of $19 million; and Bank of Mississippi, Tupelo, with deposits of $145 million. The National Bank of Commerce of Columbus, the consolidating bank, was organized in 1913 and is headquartered in Columbus in Lowndes County, Miss. With IPC deposits of $27 million, the consolidating bank operates two branches in Columbus as well as offices in Artesia, Lowndes County, and Brooksville, Noxubee County. The service area of the consolidating bank is defined as Lowndes and Noxubee counties. Direct competition is afforded the consolidating bank by First-Columbus National Bank, Columbus, with deposits of $45 million; Merchants and Farmers Bank, Columbus, with deposits of $26 million; Citizens National Bank of Meridian, Meridian, Miss., with deposits of $53 million; and Merchants and Farmers Bank, Macon, with $17 million in deposits. There is minimal competition between National Bank of Mississippi and Bank of Commerce of Columbus as the banks serve separate areas and do not have a significant number of common customers. Consummation of the proposed consolidation will allow the resulting bank to have a higher lending limit and a larger capital base. New services will be offered including in-house automation facilities, specialized assistance to farm customers, and business development and consumer advisory services. Applying the statutory criteria it is concluded that the proposed consolidation is in the public interest and this application is, therefore, approved. AUGUST 29, 1974. SUMMARY OF REPORT BY ATTORNEY GENERAL The main offices of the parties are located about 21 miles apart with the nearest offices (Applicant's Starkville branches and Bank's Artesia office) separated by a distance of about 13 miles. Thus, it appears that the proposed consolidation will eliminate some existing competition in the StarkvilleColumbus-Artesia area. However, it does not appear that concentration will be substantially increased in any relevant banking markets. Applicant may legally branch de novo into Columbus and surrounding Lowndes County. Bank is the second largest among three commercial banks with offices in the city of Columbus and Lowndes County, and holds approximately 27 percent of total Lowndes County deposits. Applicant appears to possess both the capability and incentive to expand de novo into Lowndes County, an area which has experienced relatively strong economic growth. Thus, the proposed consolidation would eliminate Applicant as a significant potential entrant into the markets presently served by Bank. The effects of this transaction on potential competition are, however, diminished somewhat by the existence of other significant potential de novo entrants into Bank's service area, including Grenada Bank and Bank of Mississippi. CITIZENS BANK OF MARLTON, NATIONAL ASSOCIATION, MARLTON, N.J., AND CITIZENS STATE BANK, VlNELAND, N . J . , AND CITIZENS NATIONAL BANK OF SOUTH JERSEY, BRIDGETON, N . J . , AND CONTINENTAL BANK OF NEW JERSEY, MAPLE SHADE, N J . Banking offices Name of bank and type of transaction Total assets In operation Citizens National Bank of South Jersey, Bridge ton, N. J. (2999), with Citizens State Bank, Vineland, N. J., with Continental Bank of New Jersey, Maple Shade, N.J., with and Citizens Bank of Marlton, National Association, Marlton, N. J. (13125), which had merged Oct. 29, 1974, under charter of the latter bank (13125) and title "Citizens United Bank, N.A." The merged bank at date of merger had COMPTROLLER'S DECISION On May 23, 1974, the above banks applied to the Comptroller of the Currency for permission to merge under the charter of Citizens Bank of Marlton, National Association, with the title of "Citizens United Bank, N.A.," and with the head office in Vineland, N.J. The charter bank and the three merging banks are all subsidiaries of Citizens Bancorp, a multi-bank holding company. Citizens Bank of Marlton, the charter bank, was organized in 1927. In addition to the head office in Marlton, it operates two branches in Evesham Township, and has two unopened but approved To be operated $ 26,441,564 50,685,279 20,129,415 33,498,441 130,754,699 13 branch locations in Mount Laurel Township. The charter bank has assets of $32.1 million and IPC deposits of $23.8 million and its service area is essentially the southwest quadrant of Burlington County. The charter bank competes primarily with an office of Heritage Bank, Cherry Hill, with deposits of $466.6 million. Additional competition is also provided by six nearby offices of Burlington County Trust Company, Moorestown, with deposits of $126 million; an office of Bank of West Jersey, Delran, with deposits of $34.4 million, which is a member of Fidelity Union Bancorporation, Newark; an office of Third National Bank of New Jersey, Camden, with 89 deposits of $50.5 million, which is a member of United Jersey Banks, Hackensack; and an office of Delaware Valley National Bank, Cherry Hill, with deposits of $20.6 million. Citizens National Bank of South Jersey, the first merging bank, with assets of $30.4 million and IPC deposits of $20.2 million, was organized in 1883 and now has three branches. The service area of the bank consists of Cumberland and Cape May counties. Its competitors include nine nearby offices of Farmers and Mechanics National Bank, Bridgeton, which has deposits of $47.7 million; three nearby offices of Cumberland National Bank, Bridgeton, which has deposits of $36.2 million, and is a member of United Jersey Bancorp; two nearby offices of Cape May County National Bank, Ocean City, which has deposits of $62.7 million; Marine National Bank, Wildwood, which has assets of $49.6 million; and others. Citizens State Bank, the second merging bank, was organized in 1967. In addition to the head office in Vineland, it operates two branches and has one branch application pending. The bank, whose service area is essentially Cumberland County, has assets of $51.5 million and IPC deposits of $36.8 million. There are two banks, with an aggregate of eight branch offices, that operate within the service area of Citizens State Bank and provide substantial competition for that merging bank. The first is Bank of New Jersey, Camden, with four branch offices, and deposits of $452.5 million. The second competing bank is Peoples National Bank of South Jersey, Westmont, which has four branches within the area and deposits of $310.4 million. The deposits of each of those two banks are significantly larger than the combined deposits of all four banks proposed to be merged. The resulting bank will have assets of only $134.5 million and IPC deposits of $97.7 million. Other competition, but to a lesser degree, is provided by two offices of Heritage Bank, with deposits of $466.6 million; City National Bank of Millville, with deposits of $18.5 million; and Minotola National Bank, Minotola, with deposits of $20.6 million. The third merging bank, Continental Bank of New Jersey, Maple Shade, Burlington County, was organized in 1968. It now has assets of $19.9 million and IPC deposits of $16.9 million. The service area of the bank is the area surrounding Maple Shade. The only other bank operating in that area is the $126 million deposit Burlington County Trust Company, Moorestown, which operates one office in 90 Maple Shade and two offices in the vicinity of, but outside, Maple Shade. The degree of competition among the merging banks, including the charter bank, is minimal as they currently comprise the membership of Citizens Bancorp. In fact, a criterion for approving the acquisition of the institutions by the holding company was that they did not compete inter sese. Additionally, there are at least 7 miles between the nearest offices of any two of the banks involved in the proposed merger. Consummation of the merger would also eliminate head office protection from Maple Shade and open that community to de novo branching by other banks. As indicated above, each bank involved in the proposed transaction has numerous competitors, many of which are significantly larger than the merging banks. Some of those competing banks will remain larger than the resulting bank when the proposed merger is consummated. The resulting bank will become the sixth largest bank operating within its service area and will have total IPC deposits of $97.7 million and assets of $134.5 million. Accordingly, the resulting bank will provide more effective competition for the larger banks and subsidiaries of bank holding companies operating throughout the area. The resulting bank will increase competition by offering improved and expanded services including a larger lending limit, a wider variety of loans, overdraft banking, data processing services, and trust department services. The bank would benefit from economies of combined operations and more efficient use of management personnel. Because the area to be served by the resulting bank is undergoing rapid growth and development in both population and industry, the improved and expanded services that will be provided by an additional bank that is competitive with the larger banks operating in the area is very much in the public interest. Applying the statutory criteria, it is concluded that the proposed transaction is in the public interest and will not result in any adverse competitive effects. This application is, therefore, approved. SEPTEMBER 20, 1974. SUMMARY OF REPORT BY ATTORNEY GENERAL The merging banks are all majority-owned subsidiaries of the same registered bank holding company. As such, their proposed merger is essentially a corporate reorganization and would have no effect on competition. CITIZENS FIRST NATIONAL BANK OF NEW JERSEY, RIDGEWOOD, N.J., AND OAKLAND STATE BANK, OAKLAND, N.J. Banking offices Name of bank and type of transaction Total assets Oakland State Bank, Oakland, N.J., with and Citizens First National Bank of New Jersey, Ridgewood, N.J. (11759), which had merged Oct. 31, 1974, under charter and title of the latter bank (11759). The merged bank at date of merger had COMPTROLLER S DECISION On June 14, 1974, Oakland State Bank, Oakland, N.J., and Citizens First National Bank of New Jersey, Ridgewood, N.J., applied to the Comptroller of the Currency for permission to merge under the charter and with the title of the latter. Citizens First National Bank of New Jersey, the charter bank, was organized in 1920 as Citizens National Bank and now operates 14 offices with assets of $241.3 million and IPC deposits of $183.9 million. The service area of the bank has a population of approximately 220,000 persons and includes northwest Bergen County and portions of adjacent Passaic County, in the northeast sector of the State, a prosperous, rapidly growing commuting and residential area which is increasingly becoming residential-industrial. Among 26 commercial banks currently headquartered in Bergen County, the charter bank ranks fifth in deposit size. Its larger competitors include Peoples Trust of New Jersey, Hackensack, with deposits of $957.3 million; National Community Bank of Rutherford, with deposits of $638.4 million; Garden State National Bank, Hackensack, with deposits of $466.6 million; and Midlantic National Bank/Citizens, Tenafly, with deposits of $263.3 million. Oakland State Bank, Oakland, N.J., the merging bank, was organized in 1969 and has operated from a single office since its inception. It has recently received approval to open a branch office in Oakland. The merging bank has assets of $9 million and IPC deposits of $6.6 million. The bank is located in Bergen County and ranks 25th in deposit size of the 26 banks headquartered there. Like the charter bank, it competes with Peoples Trust of New Jersey, National Community Bank of Rutherford, and Garden State National Bank, but it must also contend with several other banks including Urban National Bank, Franklin Lakes, with deposits of $28.6 million, and the even larger First National Bank of New Jersey, Totowa, with deposits of $493.8 $ 8,566,397 241,475,526 In To be operation operated 2 16 249,151,711 18 million. The municipalities of Oakland, Franklin Lakes, and Mahwah in Bergen County and Wanaque, Pompton Lakes, and Wayne in Passaic County, with a combined population of nearly 100,000 people, comprise the service area of the merging bank. That service area is predominantly residential-commuter mixed with some recently injected industry. Although the nearest offices of the merging and charter banks are 4.2 miles apart and the service areas of the banks overlap, the substantial difference in the size of the two institutions and the numerous banking alternatives found in their area make any competition between them insignificant. After consummation of the proposed merger the resulting bank will remain the fifth largest within its service area. Moreover, competition within the former service area of the merging bank will be stimulated because ineffectual management at that bank will be replaced by strong, innovative management and its customers will derive benefit from the introduction of trust department services, the availability of data processing, and an expanded lending capability. Home office protection will also be removed from Oakland as a result of the merger. Applying the statutory criteria it is, therefore, concluded that the proposed merger is in the public interest and this application is approved. SEPTEMBER 26, 1974. SUMMARY OF REPORT BY ATTORNEY GENERAL Citizens First National Bank of New Jersey operates a branch office in Wyckoff, which is only 4.2 miles from Oakland. Thus, it appears that the proposed acquisition would eliminate some existing competition between Citizens and Oakland State. However, it does not appear that the acquisition would substantially increase concentration in any relevant market. Citizens' share of Bergen County deposits would increase from 6.61 percent to 6.83 percent, increasing concentration by only 0.22 percent. 91 NEW JERSEY BANK (NATIONAL ASSOCIATION), CLIFTON, N.J., FAIRFIELD, AND FAIRFIELD NATIONAL BANK, N.J. Banking offices Total assets Name of bank and type of transaction In operation Fairfield National Bank, Fairfield, N.J. (15857), with and New Jersey Bank (National Association), Clifton, N.J. (15709), which had merged Oct. 31, 1974, under charter and title of the latter bank (15709). The merged bank at date of merger had COMPTROLLER'S DECISION On May 28, 1974, Fairfield National Bank, Fairfield, N.J., and New Jersey Bank (National Association), Clifton, N.J., applied to the Comptroller of the Currency for permission to merge under the charter and with the title of the latter. New Jersey Bank (National Association), Clifton, N.J., the charter bank, was organized as a State bank in 1869 and converted to the National system in 1969. It now operates 32 offices with assets of $695.9 million and IPC deposits of $523.6 million. The service area of the bank consists primarily of Passaic and Bergen counties with a concentration of activity in the cities of Paterson, Passaic, and Clifton and some activity also in portions of Morris, Sussex, and Warren counties. The combined estimated population of municipalities in which New Jersey Bank has offices is 467,080. The charter bank is the second largest of the 11 banks headquartered in Passaic County and competes primarily with National Community Bank of Rutherford, with deposits of $638 million. Additional competition is provided by offices of First National Bank of New Jersey, Totowa, with deposits of $494 million; Bank of Passaic and Clifton, National Association, Passaic, with deposits of $203 million; Prospect Park National Bank, Wayne, with deposits of $175 million; and Broadway Bank and Trust Company, Paterson, with deposits of $99 million. Fairfield National Bank, Fairfield, N.J., the merging bank, was organized in 1971 as an affiliate of New Jersey Bank (National Association), Clifton, and operates solely from its Essex County head office with assets of $8.8 million and IPC deposits of $7.3 million. The merging bank's service area is centered in the boroughs of Fairfield, Caldwell, West Caldwell, and North Caldwell, a combined estimated population of 34,855. The merging bank ranks 17th among 19 commercial banks headquartered in Essex County and competes with First National State Bank of New Jersey, 92 $ 8,095,383 758,661,811 764,858,801 To be operated 1 32 33 Newark, with deposits of $1.1 billion, which is the lead bank in First National State Bancorporation, a multi-bank holding company with total deposits of $1.7 billion; Midlantic National Bank, Newark, with deposits of $860 million, which is the principal subsidiary of Midlantic Banks, Inc., a multi-bank holding company with total deposits of $1.4 billion; American National Bank and Trust of New Jersey, Montclair, with deposits of $396 million, which is the lead bank in Horizon Bancorp, a multi-bank holding company with total deposits of $506 million; Fidelity Union Trust Company, Newark, with deposits of $820 million, which is the principal subsidiary of Fidelity Union Bancorporation, a multi-bank holding company with total deposits of $1.0 billion; and Peoples Trust of New Jersey, Hackensack, with deposits of $957.3 million, which is the lead bank in United Jersey Banks, a multi-bank holding company with total deposits of $1.5 billion. There is minimal competition between the charter and merging banks because the two banks are commonly owned and the nearest offices are at least 2.5 miles apart. Additionally, the small size of the merging bank and the local nature of its service area prevent it from being a significant competitor of the charter bank. The resulting bank would have IPC deposits of approximately $530.9 million and assets of $703.6 million. Consummation of the proposed merger would afford expanded and improved services including a larger lending limit, 24-hour banking with automated teller machines, overdraft banking, data processing services, a wider variety of loans, and international services. The resulting bank will be a more viable competitor with the much larger holding company affiliated banks in the area. Also, consummation of the proposed merger will eliminate head office protection and open Fairfield to de novo branching by other banks. Based on the foregoing, it appears that this transaction will stimulate competition in the service area of the merging and charter banks. Applying the statutory criteria it is concluded that the proposed merger is in the public interest and this application is, therefore, approved. SEPTEMBER 25, 1974. SUMMARY OF REPORT BY ATTORNEY GENERAL We have reviewed this proposed transaction and conclude that it would not have a substantial competitive impact. FIRST MISSISSIPPI NATIONAL BANK, HATTIESBURG, MISS., AND CITIZENS NATIONAL BANK, JACKSON, MISS. Banking offices Total assets Name of bank and type of transaction In operation Citizens National Bank, Jackson, Miss. (15516), with was purchased Nov. 14, 1974, by First Mississippi National Bank, Hattiesburg, Miss. (5176), which had After the purchase was effected, the receiving bank had COMPTROLLER S DECISION On November 12, 1974, an application was made to the Comptroller of the Currency by the First Mississippi National Bank, Hattiesburg, Miss., for permission to purchase assets and assume deposit liabilities of the Citizens National Bank, Jackson, Miss. Pursuant to the provisions of 12 U.S.C. 181 and 12 U.S.C. 1828(c), it is found that an emergency exists and that this Office must act immediately to prevent the probable failure of the Citizens National $161,540,607 7 38,404,720 199,939,304 18 To be operated 25 Bank, Jackson, Miss., and to protect its depositors, creditors, and shareholders. Accordingly, approval by the shareholders of the Citizens National Bank of the purchase and sale agreement is waived and the First Mississippi National Bank is authorized to proceed with the purchase and assumption transaction. NOVEMBER 14, 1974. NOTE: Due to the emergency nature of the situation, no report on competitive factors was requested. * * * PITTSBURGH NATIONAL BANK, JEANETTE, PA., AND BLAIRSVILLE NATIONAL BANK, BLAIRSVILLE, PA. Banking offices Name of bank and type of transaction Total assets In operation Blairsville National Bank, Blairsville, Pa. (13868), with $ 26,794,514 was purchased Nov. 15, 1974, by Pittsburgh National Bank, Jeannette, Pa. (252), which h a d . . 2,753,171,005 After the purchase was effected, the receiving bank had 2,779,308,557 COMPTROLLER'S DECISION On July 8, 1974, Pittsburgh National Bank, Jeannette, Pa., applied to the Comptroller of the Currency for permission to purchase the assets and assume the liabilities of Blairsville National Bank, Blairsville, Pa. Pittsburgh National Bank, the purchasing bank, was founded in 1864 and now has assets of $2.5 billion and IPC deposits of $1.2 billion. The bank is headquartered in Westmoreland County and oper To be operated 2 94 96 ates 92 offices serving all of Allegheny, Westmoreland, Butler, and Washington counties. As a result of relocation of its headquarters in 1973, the purchasing bank can legally expand in four additional counties: Indiana, Cambria, Somerset, and Fayette. Indiana County is the only one of the four into which the bank has expanded since the head office relocation. Two offices are operated in the borough of Indiana, 15 miles north of Blairsville. Principal competitors of purchasing bank include, Mellon Bank, N.A., Pittsburgh, with deposits of $7.4 93 billion; Equibank, N.A., Pittsburgh, with deposits of $1.4 billion; Union National Bank of Pittsburgh with deposits of $768 million; Iron and Glass Bank, Pittsburgh, with deposits of $28 million; Commercial Bank and Trust Co., Pittsburgh, with deposits of $65 million; and Allegheny Valley Bank of Pittsburgh with deposits of $27 million. Blairsville National Bank, the selling bank, was founded in 1933 and operates a main office and drive-in facility in Blairsville. With assets of $25.5 million and IPC deposits of $20 million, the selling bank primarily serves Blairsville. The selling bank ranks third in size among the banks serving Blairsville and fourth in size among the six banks headquartered in Indiana County. Primary competitors for the selling bank are The Savings and Trust Company of Indiana, with deposits of $77 million; National Bank of the Commonwealth, Indiana, with deposits of $105 million; and Homer City State Bank, Homer City, with deposits of $28 million. There is no competition between the buying and selling banks. The nearest office of Pittsburgh National Bank is 15 miles from the selling bank. Both the National Bank of the Commonwealth and the Homer City State Bank are established viable competitors. Consummation of the proposed transaction will result in no adverse competitive effects and the resulting bank will be an aggressive competitor in the Blairsville service area. A small unaggressive bank with aged management will be replaced by a sophisticated metropolitan bank capable of providing better and more efficient banking services to the customers of selling bank. Applying the statutory criteria it is concluded that the proposed transaction is in the public interest and this application is, therefore, approved. OCTOBER 10, 1974. SUMMARY OF REPORT BY ATTORNEY GENERAL The nearest offices of the parties are located about 15 miles apart in Indiana County with several competitive alternatives in the intervening area. It appears that the proposed acquisition would eliminate some existing competition. However, it does not appear that the proposed transaction would substantially increase banking concentration in any relevant market. And in view of the modest size of Blairsville Bank and the nature of the community which it serves, we conclude that the proposed transaction will not eliminate substantial potential competition. Therefore, we conclude that the proposed transaction would not have a substantial competitive impact. THE FIRST NATIONAL BANK OF EASTERN PENNSYLVANIA, WILKES-BARRE, PA., AND THE BERWICK NATIONAL BANK, BERWICK, PA. Banking offices Total assets Name of bank and type of transaction The Berwick National Bank, Berwick, Pa. (6162), with and The First National Bank of Eastern Pennsylvania, Wilkes-Barre, Pa. (30), which had merged Nov. 15, 1974, under charter of the latter bank (30) and title "First Eastern Bank, National Association." The merged bank at date of merger had COMPTROLLER S DECISION On July 3, 1974, Berwick National Bank, Berwick, Pa., and The First National Bank of Eastern Pennsylvania, Wilkes-Barre, Pa., applied to the Comptroller of the Currency for permission to merge under the charter of the latter and with the title, "First Eastern Bank, National Association." First National Bank of Eastern Pennsylvania, the charter bank, was organized in 1863 and now has 94 $ 22,048,850 381,565,461 403,091,570 In To be operation operated 2 21 23 assets of $364 million and IPC deposits of $259 million. Headquartered in Wilkes-Barre, Pa., the charter bank through its main office and 20 branches serves all of Luzerne County, the northern 80 percent of Monroe County, and west-central Columbia County. The bank's influence is felt in Lackawanna and Carbon counties although it has no offices in either. The charter bank is the fourth largest bank in Wilkes-Barre. The principal competitors of charter bank include Northeastern Bank of Pennsylvania, Scranton, with current deposits of $422 million; First Valley Bank, Lansford, with deposits of $417 million; United Penn Bank, Wilkes-Barre, with deposits of $377 million; The Wyoming National Bank of Wilkes-Barre, with deposits of $123 million; and Hanover National Bank of Wilkes-Barre with deposits of $54 million. The Berwick National Bank, the merging bank, was organized in 1902 and is headquartered in Berwick, Pa., about 28 miles southwest of WilkesBarre. With assets of $22.3 million and IPC deposits of $19 million, the merging bank operates one branch in Mifflinville, about 5 miles southwest of Wilkes-Barre. Its service area is confined to Berwick and its immediate environs. The principal competitors in the merging bank's service area include United Penn Bank, WilkesBarre, with deposits of $377 million; The First National Bank of Berwick, with deposits of $30 million; The Columbia County Farmers National Bank of Orangeville, with deposits of $20 million; and The First National Bank of Mocanaqua, with deposits of $14.5 million. The charter bank's East End Office in Bloomsburg and the merging bank's Mifflinville Office are their closest offices and are 8 miles apart. Geographic barriers which consist of hills, farmland, and the Susquehanna River prevent those two offices from significantly competing with each other. Consummation of the proposed merger will stimulate competition as merging bank will be better able to compete with the larger United Penn Bank. The resulting bank will offer new and improved services in Berwick such as specialized lending services and trust services. The bank will also offer a considerably larger lending limit. Applying the statutory criteria it is concluded that the proposed merger is in the public interest and this application is, therefore, approved. OCTOBER 9, 1974. SUMMARY OF REPORT BY ATTORNEY GENERAL Although the main offices of the parties are separated by a distance of about 30 miles, First National's Conyngham (Luzerne County) office is situated about 9 miles east, and its Bloomsburg (Columbia County) office about 9 miles west, of Berwick Bank's nearest office. Although there are competitive alternatives in the intervening areas, it nevertheless appears that the proposed merger would eliminate some existing competition between the parties. Moreover, First National could legally establish de novo offices in the Berwick area in east-central Columbia County. Therefore, we conclude that some existing competition, as well as the potential for increased competition, will be eliminated by this proposed transaction. NATIONAL BANK OF THE COMMONWEALTH, INDIANA, PA., AND THE HOUTZDALE BANK, HOUTZDALE, PA. Banking offices Name of bank and type of transaction Total assets The Houtzdale Bank, Houtzdale, Pa., with was purchased Nov. 18, 1974, by National Bank of the Commonwealth, Indiana, Pa. (14098), which had After the purchase was effected, the receiving bank had $ 10,707,621 1 121,653,773 128,460,082 13 COMPTROLLER'S DECISION On July 15, 1974, National Bank of the Commonwealth, Indiana, Pa., applied to the Comptroller of the Currency for permission to purchase the assets and assume the liabilities of The Houtzdale Bank, Houtzdale, Pa. National Bank of the Commonwealth, the purchasing bank, was chartered in 1934 and currently has assets of $118.7 million and IPC deposits of In To be operation operated 14 $104.6 million. The bank, headquartered in Indiana County, operates 11 branches and serves portions of Indiana, Jefferson, Cambria, Armstrong, and Westmoreland counties. The economy of the service area is supported by soft coal production, farming, and a variety of light industries. National Bank of the Commonwealth is the eighth largest bank operating in the Pittsburgh area and all the large Pittsburgh banks are, in effect, its competitors. If the proposed transaction is approved, the 95 purchasing bank will remain eighth in size and still be considerably smaller than number seven. The Houtzdale Bank, Houtzdale, Pa., the selling bank, was organized in 1918 and operates as a unit bank about 66 miles northeast of Indiana, Pa. The bank, with total assets of $9.8 million and IPC deposits of $7.8 million, is fourth in size among four banks in its service area which includes the area surrounding Houtzdale, north to Philipsburg and south to Coalport. Competition for the selling bank is provided by the three larger banks operating in the selling bank's service area. They are County National Bank, Clearfield, with $54 million in deposits; Clearfield Bank and Trust Co., Clearfield, with $32 million in deposits; and First National Bank of Philipsburg with $27 million in deposits. Upon consummation of the proposed transaction, the resulting bank will become the largest in the area. However, if the pending merger of First National Bank of Philipsburg and Mid-State Bank and Trust Company, Altoona, is consummated, the bank resulting from that transaction will be the largest in the area. Approval of the subject transaction will not diminish competition in the selling bank's service area. There is no competition between the purchasing and selling banks, as their nearest offices are about 26 miles apart. The sparsely inhabited and densely forested intervening area precludes possibility of competition between the two banks. The insignificant amount of business conducted by the purchasing bank in the selling bank's service area results from the selling bank's inability to grant and service the type loans demanded by local industries. Consummation of the proposed transaction will result in no adverse competitive effects. Additionally, the resulting bank will provide an expanded range of services to the residents and businesses of the Houtzdale area such as larger lending limits and other services afforded by larger commercial banks. Applying the statutory criteria, it is concluded that the proposed transaction is in the public interest and this application is, therefore, approved. OCTOBER 16, 1974. SUMMARY OF REPORT BY ATTORNEY GENERAL We have reviewed this proposed transaction and conclude that it would not have a substantial competitive impact. BANKERS TRUST COMPANY OF ALBANY, NATIONAL ASSOCIATION, ALBANY, N.Y., NATIONAL BANK OF COOPERSTOWN, COOPERSTOWN, AND THE FIRST N.Y. Banking offices Total assets Name of bank and type of transaction In operation First National Bank of Cooperstown, Cooperstown, N.Y. (280), with and Bankers Trust Company of Albany, National Association, Albany, N.Y. (15758), which had.. merged Nov. 29, 1974, under charter and title of the latter bank (15758). The merged bank at date of merger had COMPTROLLER'S DECISION On July 10, 1974, The First National Bank of Cooperstown, Cooperstown, N.Y., and Bankers Trust Company of Albany, National Association, Albany, N.Y., applied to the Comptroller of the Currency for permission to merge under the charter and with the title of the latter. Bankers Trust Company of Albany, National Association, the charter bank, was organized in 1838 and now operates 25 branch offices with assets of $270.9 million and IPC deposits of $161.2 million. In addition to the 25 operating branch offices, Bankers Trust Company of Albany has approval to open branches at three new locations. The charter bank 96 % 17,791,081 266,520,970 284,312,051 To be operated 1 26 27 is a member of Bankers Trust New York Corporation, a multi-bank holding company with nine member banks and total deposits of $14.0 billion. Its service area includes the central and eastern portion of the Fourth Banking District of New York, with an estimated population of 505,300. The charter bank is ranked third in deposit size among the eight commercial banks headquartered in Albany County and among the 30 commercial banks headquartered in the Fourth Banking District of New York. Competition for the bank is provided by National Commercial Bank and Trust Company, Albany, with deposits of $796 million, which is a member of United Bank Corporation of New York; Citibank (Eastern), National Association, Castleton- Consummation of the proposed merger will stimulate competition in the service area of the merging bank. In Cooperstown the merger will eliminate head office protection afforded by New York State law and open the community to de novo branching by other banks. Additionally, a branch office of the resulting bank will provide the banking public in Cooperstown with improved and expanded services including a larger lending limit, a wider variety of loans, a credit card program, expanded personal and corporate trust services, investment services, and international banking services. The deposit size of the resulting bank relative to commercial banks headquartered in Albany County in the Fourth Banking District will not be changed by consummation of the merger. The resulting bank will have total deposits of $249 million. Applying the statutory criteria, it is concluded that the proposed merger is in the public interest and this application is, therefore, approved. on-Hudson, with deposits of $23 million, which is a member of Citicorp; and Marine Midland BankEastern, National Association, Troy, with deposits of $189.7 million, which is a member of Marine Midland Banks, Inc. The First National Bank of Cooperstown, the merging bank, with assets of $17.2 million and IPC deposits of $14.0 million, was organized in 1830 and has operated as a unit institution since that time. Its service area includes the northern portion of Otsego County in the Fourth Banking District of the State of New York and has an estimated population of 39,000. The merging bank is the smaller of the two commercial banks headquartered in Otsego County and ranks 24th in deposit size among the 30 commercial banks headquartered in the Fourth Banking District of New York State. In addition to in-county competition provided by Wilber National Bank of Oneonta, with deposits of $55.6 million, competition is provided by State Bank of Albany; National Commercial Bank and Trust Company; and Central National Bank, Canajoharie, with deposits of $69 million. There is no significant competition between the charter and merging banks. Bankers Trust Company of Albany, National Association has no offices in Otsego County and the closest offices of the charter and merging banks are approximately 50 miles apart. Accordingly, the two banks do not provide services to a common area. The small size of the merging bank and its conservative nature also preclude the possibility of significant competition with the charter bank. INDIAN HEAD NATIONAL BANK OF NASHUA, N.H., OCTOBER 23, 1974. SUMMARY OF REPORT BY ATTORNEY GENERAL Applicant's office nearest Bank is located in Johnstown, Fulton County, about 50 miles northeast of Cooperstown. Thus, it appears that the proposed transaction would not eliminate substantial existing competition. And in view of the existence of other significant potential entrants and Bank's modest market position in the Coopers to wn-Otsego County area, we conclude that the proposed merger will not eliminate substantial potential competition. AND INDIAN HEAD NATIONAL BANK OF MANCHESTER, MANCHESTER, N.H. Banking offices Name of bank and type of transaction Total assets In operation Indian Head National Bank of Nashua, Nashua, N.H. (1310), with and Indian Head National Bank of Manchester, Manchester, N.H. (15563), which had consolidated Nov. 29, 1974, under charter of the latter bank (15563) and title "Indian Head National Bank of Nashua." The consolidated bank at date of consolidation had COMPTROLLER'S DECISION On July 8, 1974, Indian Head National Bank of Manchester, Manchester, N.H., and Indian Head National Bank of Nashua, Nashua, N.H., applied to the Comptroller of the Currency for permission to $105,753,788 11,817,634 117,571,421 To be operated 6 2 8 consolidate under charter of the former and title of the latter with the main office in Nashua. Indian Head National Bank of Manchester, the charter bank, was organized in 1921 but did not convert to National bank status until 1965. In addition to its main office, the bank presently operates a 97 branch office in Goffstown, 4 miles west of Manchester. The charter bank holds assets of $11.9 million and IPC deposits of $9.5 million. The service area of the bank is southern New Hampshire, and consists of the city of Manchester, with a population of 97,000 persons, which is currently undergoing an economic revival, and portions of surrounding Hillsborough County, a rapidly growing region which is the center of an electronics industry. The charter bank encounters vigorous competition from several of the State's largest commercial institutions. Among the larger are The Manchester Bank with deposits of $145 million; Bank of New Hampshire, N.A., Manchester, with deposits of $121 million; The Merchants National Bank, Manchester, with deposits of $36.9 million, which is an affiliate of First New Hampshire Bancorp, Inc.; and Amoskeag National Bank and Trust Company, Manchester, with deposits of $39.7 million. Indian Head National Bank of Nashua, the consolidating bank, was chartered in 1851 and converted to National bank status in 1865. The bank operates five branches, four of which are located in the nearby towns of Hudson, Merrimack, Salem, and Wilton, and maintains total assets of $107.4 million and IPC deposits of $75.9 million. The service area of the consolidating bank is situated on New Hampshire's southern border and consists of the thriving retail trade center of Nashua, one of the State's major cities, with an estimated population of 63,000 people, as well as portions of Hillsborough County, the State's fastest growing county with a population of approximately 256,000. Branches of New Hampshire's second-largest banking institution, Bank of New Hampshire, N.A.; Nashua Trust Company, with deposits of $68.5 million; and Colonial Trust Company, with deposits of $14.5 million, provide significant competition for the consolidating bank. Between the charter and consolidating banks there is only minimal competition because they serve distinct service areas. Their closest two offices are separated by a relatively large distance and an adequate number of banking facilities operate as alternatives in eastern Hillsborough County. The closest offices of the two banks are approximately 15 miles apart, and the small size of the charter bank prevents it from being a significant competitor for the consolidating bank. The fact that both banks are owned by the same holding company, Indian Head Banks, Inc., Nashua, N.H., further eliminates the possibility of meaningful competition. Within its service area the charter bank has ceased to be a viable competitor because any sizable or sophisticated lending request must be forwarded to the consolidating bank due to the size and management limitations of the charter bank. Consummation of the proposed consolidation will infuse increased competition into the present service area of Indian Head National Bank of Manchester. To that area the resulting bank will bring an increased lending limit, specialized trust and investment departments, and various types of lending expertise heretofore unavailable directly from the charter bank. Those changes will make the resulting branch in Manchester a more vital participant in the economic life of the city. Applying the statutory criteria it is concluded that the proposed merger is in the public interest and this application is, therefore, approved. OCTOBER 15, 1974. SUMMARY OF REPORT BY ATTORNEY GENERAL The consolidating banks are both majority-owned subsidiaries of the same bank holding company. As such, their proposed consolidation is essentially a corporate reorganization and would have no effect on competition. MECHANICS NATIONAL BANK OF DELAWARE VALLEY, BURLINGTON TOWNSHIP, N.J., BANK AND TRUST COMPANY, EGG HARBOR CITY, AND EGG HARBOR NJ. Banking offices Name of bank and type of transaction Total assets In operation Egg Harbor Bank and Trust Company, Egg Harbor City, N.J., with and Mechanics National Bank of Delaware Valley, Burlington Township, N.J. (1222), which had merged Nov. 29, 1974, under charter of the latter bank (1222) and title "First National State Bank/Mechanics." The merged bank at date of merger had 98 $ 24,280,566 3 109,646,386 12 133,926,951 To be operated 15 COMPTROLLER'S DECISION On July 9, 1974, Egg Harbor Bank and Trust Company, Egg Harbor City, N.J., and Mechanics National Bank of Delaware Valley, Burlington Township, N.J., applied to the Comptroller of the Currency for permission to merge under the charter of the latter and with the title, "First National State Bank/Mechanics.'' Mechanics National Bank of Delaware Valley, the charter bank, was organized in 1839 and is a subsidiary of First National State Bancorporation, Newark, N.J. The bank has assets of $106.7 million and IPC deposits of $76 million and operates 13 branch offices and three facilities in Burlington County. Ten of the branches are in the Trenton service area and three are in the Camden service area. Competitors of charter bank in Burlington County include Burlington County Trust Company, Moorestown, with total deposits of $126 million; Bank of Mid-Jersey, Bordentown Township, with total deposits of $59 million; Provident Bank of New Jersey, Willingboro, with total deposits of $405 million, which is a member of Greater Jersey Bancorp, a multi-bank holding company with total deposits of $711 million; The Burlington County National Bank, Medford, with total deposits of $35 million; Bank of West Jersey, Delran, with total deposits of $34.4 million, which is a member of Fidelity Union Bancorporation, a multi-bank holding company with total deposits of $1 billion; and Continental Bank of New Jersey, Maple Shade, with total deposits of $18 million. Egg Harbor Bank and Trust Company, the merging bank, was organized in 1925. The bank is headquartered in Egg Harbor City and operates branches in the townships of Mullica and Galloway. With assets of $24.5 million and IPC deposits of $18 million, the merging bank is fifth in deposit size among the seven commercial banks headquartered in Atlantic County. Competition from banks headquartered in Atlantic County is provided by First National Bank of South Jersey, Pleasantville, with deposits of $403 million; Guarantee Bank, Atlantic City, with deposits of $120 million; Atlantic National Bank, Atlantic City, with deposits of $41 million; First National Bank of Absecon, Absecon, with deposits of $25 million; Minotola National Bank, with deposits of $21 million; and The Mainland Bank, Linwood, with deposits of $16 million. There is minimal competition between the charter and merging banks as their closest offices are more than 30 miles apart. Moreover, the banks' present service areas are separated by a sparsely populated area known as the Pine Barrens. The nearest office of another subsidiary bank of First National State Bancorporation is located some 37 miles from the Pomona office of the merging bank. Consummation of the proposed merger will stimulate competition in the service area of the merging bank because the resulting bank will offer improved services such as an expanded trust department, lease financing facilities, international bank services, and an increased lending limit. The resulting bank will remain the second largest commercial bank headquartered in Burlington County. Applying the statutory criteria it is concluded that the proposed merger is in the public interest and this application is, therefore, approved. OCTOBER 9, 1974. SUMMARY OF REPORT BY ATTORNEY GENERAL The nearest offices of the parties are separated by a distance of approximately 30 miles, with the New Jersey "Pine Barrens" lying in the intervening area. Thus, we conclude that the proposed transaction would not eliminate substantial existing competition. Commercial banking in Atlantic County is highly concentrated, with the four largest institutions controlling approximately 88 percent of total county deposits. Applicant's parent, First National State Bancorporation, is the largest commercial banking organization in the State of New Jersey. As such, it has the capability and incentive to expand de novo into Atlantic County and elsewhere in southeastern New Jersey. However, in view of the existence of other significant potential entrants and Bank's modest (approximately 4.1 percent of Atlantic County deposits) market position, we conclude that the proposed merger would not eliminate substantial potential competition. 99 SECURITY NATIONAL BANK OF KANSAS CITY, KANSAS CITY, KANS., AND THE VICTORY STATE BANK, KANSAS CITY, KANS. Banking offices Total assets Name of bank and type of transaction In operation The Victory State Bank, Kansas City, Kans., with and Security National Bank of Kansas City, Kansas City, Kans. (13801), which had merged Nov. 29, 1974, under charter and title of the latter bank (13801). The merged bank at date of merger had COMPTROLLER S DECISION On June 10, 1974, Security National Bank of Kansas City, Kansas City, Kans., applied to the Comptroller of the Currency for permission to merge with The Victory State Bank, Kansas City, Kans., under the charter and title of the former. Security National Bank of Kansas City, Kansas City, Kans., the charter bank, was chartered in 1933 and currently has assets of $151.3 million and IPC deposits of $67 million. The bank is located in the 2-state Kansas City Metropolitan Area, and is the sixth largest bank in that area. It is the second largest of the 19 banks in the Kansas sector of the metropolitan area. Competition for the charter bank is provided by Commercial National Bank of Kansas City, Kans., with total deposits of $154.4 million; The Brotherhood State Bank, Kansas City, Kans., with total deposits of $44.5 million; and The First State Bank of Kansas City, Kans., with total deposits of $23.3 million. Additional competition is provided by the larger Kansas City, Mo., banks including Commerce Bank of Kansas City, N.A., with deposits of $583.4 million, and United Missouri Bank of Kansas City, N.A., with deposits of $461.4 million. The Victory State Bank, Kansas City, Kans., the merging bank, was chartered in 1929 and currently has assets of $9.2 million and IPC deposits of $6.5 million. The merging bank is the 92nd largest of the 107 banks in the Kansas City Metropolitan Area. Victory State Bank is controlled by the same family group that controls the charter bank, and, in the past, has been considered an affiliate of the charter bank. Competition between the charter bank and the merging bank is almost nonexistent, despite the fact that their offices are located 1 mile apart. That is because of the nature of the respective banks' 100 $ To be operated 9,128,913 169,462,647 178,591,559 business. The merging bank is a small retail bank serving a local neighborhood. The charter bank is primarily a wholesale and correspondent bank serving the metropolitan area. The proposed merger will not significantly increase the charter bank's size and share of deposits. Consummation of the proposed transaction will result in no adverse competitive effects. The merger will formalize an already strong affiliation between the two banks and it will resolve the management succession and staffing problems confronting Victory State Bank. The merger will also enable the merging bank to provide additional services such as data processing facilities and an improved trust department. Applying the statutory criteria, it is concluded that the proposed transaction is in the public interest and is, therefore, approved. OCTOBER 24, 1974. SUMMARY OF REPORT BY ATTORNEY GENERAL Applicant is headquartered in downtown Kansas City with Bank's headquarters situated about 1 mile to the west. Accordingly, the proposed merger would apparently eliminate competition between the parties and slightly increase concentration in commercial banking in the Kansas City area. The application indicates that the parties are commonly owned by a group of individuals which collectively hold 52.5 percent of Applicant's stock and 81.4 percent of the stock of Bank. The application does not, however, contain sufficient information to evaluate the effects, if any, of this common ownership on the competitive effects of the proposed merger. Thus, we express no opinion on the effect of common stock ownership and management on the foregoing competitive report. VERMONT NATIONAL BANK, BRATTLEBORO, V T . , AND MONTPELIER NATIONAL BANK, MONTPELIER, V T . Banking offices Total assets Name of bank and type of transaction In operation Montpelier National Bank, Montpelier, Vt. (13915), with and Vermont National Bank, Brattleboro, Vt. (1430), which had merged Nov. 29, 1974, under charter and title of the latter bank (1430). The merged bank at date of merger had COMPTROLLER'S DECISION On July 19, 1974, Montpelier National Bank, Montpelier, Vt., and Vermont National Bank, Brattleboro, Vt., applied to the Comptroller of the Currency for permission to merge under the charter and with the title of the latter. Vermont National Bank, the charter bank, was organized in 1821 and now operates 14 branches. It has assets of $111.5 million and IPC deposits of $92 million. The service area of the bank constitutes southern Vermont which is primarily rural with population centered around the towns of Bennington, Brattleboro, Rutland, and Springfield. The charter bank is presently the fifth largest bank in Vermont and competes primarily with the four larger banks. Those competitors are Chittendon Trust Company, Burlington, with deposits of $216 million; Burlington Savings Bank, Burlington, with deposits of $207 million; The Howard Bank, Burlington, with deposits of $169 million; and First Vermont Bank and Trust Company, Brattleboro, with deposits of $143 million. Montpelier National Bank, the merging bank, was organized in 1824 and operates one branch 3.5 miles from its main office in Montpelier. The branch is halfway between the cities of Montpelier and Barre. The service area of the merging bank, which has assets of $34.4 million and IPC deposits of $28 million, includes both Barre and Montpelier. The merging bank's principal competitors in the Montpelier-Barre service area are Chittendon Trust Company, Burlington, with deposits of $216 million; The Howard Bank, Burlington, with deposits of $169 million; and The First Vermont Bank and Trust Company, Brattleboro, with deposits of $143 million. There is no competition between the charter and merging banks because their closest offices are 55 $ 34,785,131 154,110,108 To be operated 2 15 17 154,110,108 miles apart. Consummation of the proposed merger will stimulate competition in the service area of the merging bank as the resulting bank will offer new and improved services such as more varied deposit and loan options. The merger will also solve Montpelier National Bank's management succession problem. The resulting bank will remain the fifth largest in Vermont. Applying the statutory criteria it is concluded that the proposed merger is in the public interest and the application is, therefore, approved. OCTOBER 22, 1974. SUMMARY OF REPORT BY ATTORNEY GENERAL The nearest offices of the parties are separated by a distance of more than 50 miles. Thus, it does not appear that the proposed transaction will eliminate substantial existing competition. Montpelier National is presently the second largest bank in the Montpelier-Barre area with approximately 20 percent of total deposits. The three largest banks in the Montpelier-Barre market hold about 66 percent of total deposits. Vermont National, the fourth largest bank in Vermont, is currently the largest bank in the State not yet represented in the Montpelier-Barre area; clearly, it has the capability and resources for de novo entry rather than through acquisition as here proposed. However, while the economy of the Montpelier-Barre area is basically sound, its growth rate appears somewhat limited. Furthermore, there are at present at least two approved charters for new (but not yet opened) offices in the area by banks already located there. Under the circumstances, the proposed acquisition of Montpelier National by Vermont National would not have a significantly adverse effect on potential competition. 101 OLD NATIONAL BANK OF WASHINGTON, SPOKANE, WASH., AND GUARANTY NATIONAL BANK OF WHITE CENTER, SEATTLE, WASH. Banking offices Total assets Name of bank and type of transaction In operation Guaranty National Bank of White Center, Seattle, Wash. (14502), with was purchased Dec. 2, 1974, by Old National Bank of Washington, Spokane, Wash. (4668), which had After the purchase was effected, the receiving bank had COMPTROLLER'S DECISION On August 8, 1974, Old National Bank of Washington, Spokane, Wash., applied to the Comptroller of the Currency for permission to purchase the assets and assume the liabilities of Guaranty National Bank of White Center, Seattle, Wash. Old National Bank of Washington, the purchasing bank, was organized in 1891 and presently has total assets of $478 million and IPC deposits of $383 million. The purchasing bank is headquartered in Spokane in eastern Washington and 46 of its 54 branches are located east of the Cascade Mountains. Its eight other branches are located in western Washington, with one in Ferndale, five in Lynnwood, and two in downtown Seattle. The economy of the area served by the purchasing bank in the eastern part of the State is based on agriculture; that of the area served in the western part of the State is supported by the aerospace industry and forestry. The purchasing bank is a subsidiary of Washington Baneshares, Inc., a registered bank holding company. Competition for the purchasing bank in western Washington is provided by Seattle-First National Bank, Seattle, with deposits of $2.9 billion; National Bank of Commerce of Seattle with deposits of $1.9 billion; Pacific National Bank of Washington, Seattle, with deposits of $727 million; and Peoples National Bank of Washington, Seattle, with deposits of $565 million; and, in eastern Washington, is provided by Fidelity Mutual Savings Bank, Spokane, with deposits of $329 million; and branches of the larger Seattle-based banks. Guaranty National Bank of White Center, the selling bank, was organized in 1945 and presently operates two branches. It has total assets of $22.6 million and IPC deposits of $19.8 million. The primary service area of the selling bank encompasses the western portion of central King County, a residential area with little industry. Competition for the selling bank is provided by Seattle-First National Bank, Seattle, with deposits of $2.9 billion; National Bank of Commerce of 102 $ 23,353,005 3 516,351,980 564,941,922 57 To be operated 60 Seattle, with deposits of $1.9 billion; Pacific National Bank of Washington, Seattle, with deposits of $727 million; and Continental Bank of Burien, with deposits of $11.8 million. There is little, if any, competition between the purchasing and selling banks because relatively large distances separate their closest offices and an adequate number of alternative banking facilities operate in the intervening area. The nearest branch of the purchasing bank is located in downtown Seattle, 8 miles from Guaranty National Bank of White Center. In addition, the selling bank is situated west of the Cascade Mountains, where the purchasing bank derives a small minority of its total business. The head offices of the two banks are 283 miles apart. Consummation of the proposed transaction will result in no adverse competitive effects. The purchasing bank will remain the sixth largest bank in the State. The transaction will have a favorable effect upon competition by enabling the purchasing bank to achieve further penetration into the western part of the State and strengthen its competitive position among the larger banks in Washington. In addition, the purchasing bank will introduce new and improved services to the residents of the service area of the selling bank such as an increased lending limit and trust services. Furthermore, consummation of the proposed transaction will alleviate the management succession problem of Guaranty National Bank of White Center. Applying the statutory criteria, it is concluded that the proposed transaction is in the public interest and this application is, therefore, approved. OCTOBER 30, 1974. SUMMARY OF REPORT BY ATTORNEY GENERAL ONB's headquarters and the bulk of its operations lie east of the Cascade Mountains. It does, however, operate two branch offices in Seattle, King County. As of June 30, 1973, ONB's two Seattle offices held total deposits of $16.5 million. Guaranty's main office is located over 8 miles south of downtown Seattle in the residential community of White Center; its two remaining offices are located 3 and 13 miles southeast of the headquarters office in Boulevard Park and Renton. The proposed transaction appears to represent the consolidation of a downtown Seattle bank which holds a small share of the area's deposits with a small suburban community bank. Although the proposal will eliminate some existing competition as well as the potential for increased future competition, we conclude that, overall, the proposal would not have a significantly adverse effect on competition. THIRD NATIONAL BANK OF NEW JERSEY, CAMDEN, N.J., AND UNITED JERSEY NATIONAL BANK OF CHERRY HILL, CHERRY HILL, N J . Banking offices Name of bank and type of transaction Total assets In operation United Jersey National Bank of Cherry Hill, Cherry Hill, N J . (15971), with and Third National Bank of New Jersey, Camden, N. J. (13203), which had merged Dec. 2, 1974, under charter of the latter bank (13203) and title "United Jersey Bank/ Third National." The merged bank at date of merger had COMPTROLLER'S DECISION On August 16, 1974, United Jersey National Bank of Cherry HiU, Cherry Hill, N.J., and Third National Bank of New Jersey, Camden, N.J., applied to the Comptroller of the Currency for permission to merge under the charter of the latter and title of "United Jersey Bank/Third National." Third National Bank of New Jersey, the charter bank, was organized in 1928 and currently operates 11 banking offices with assets of $58.2 million and IPC deposits of $46 million. It is a member of United Jersey Banks, a multi-bank holding company. The charter bank's service area includes portions of Camden, Burlington, and Gloucester counties, an urban and suburban area with an estimated population of 224,000. The charter bank ranks sixth in size among the 12 commercial banks headquartered in Camden, and 10th among the 20 banks in its service area. Competition is provided by Heritage Bank National Association, Cherry Hill, with deposits of $467 million, which is a member of Heritage Bancorporation, a multi-bank holding company; The Bank of New Jersey, Camden, with total deposits of $452 million, which is a member of Bancshares of New Jersey; Peoples National Bank of New Jersey, Westmont, N.J., with deposits of $310 million; and Midlantic National Bank/South, Haddonfield, with deposits of $195 million, which is a member of Midlantic Banks, Inc. Competition is also provided by Burlington County-based banks including Mechanics National Bank of Delaware Valley, $10,836,278 64,102,809 74,939,087 To be operated 2 11 13 Burlington Township, with deposits of $97 million, which is a member of First National State Bancorporation, and Burlington County Trust Company, Moorestown, with deposits of $126 million. United Jersey National Bank of Cherry Hill, the merging bank, was organized in 1972 and currently has two offices with assets of $10.4 million and IPC deposits of $8.7 million. The merging bank is a member of United Jersey Banks, the same multi-bank holding company that owns the charter bank. The service area of the merging bank is the residential suburb of Cherry Hill, a rapidly-growing community with an estimated population of 67,000. The same banks that are headquartered in Camden and compete with the charter bank also compete with the merging bank. Competition between the merging bank and the charter bank is minimal. The charter bank has only a small percentage of deposits from the merging bank's service area. The closest offices of the two banks are 4 miles apart, in a developed area. The fact that both banks are members of the same holding company also has minimized meaningful competition. Consummation of the proposed transaction will result in no adverse competitive effects. The resulting bank will remain the sixth largest bank headquartered in Camden County. The proposed merger will enable the banks to compete more effectively with the larger banks in the area. The resulting bank will have a larger lending limit and will be able to offer its customers more convenience in the form of 103 an increased number of banking offices. Customers of the resulting bank will be able to make use of trust services not previously offered by the merging bank. The proposed merger will also benefit both banks in achieving certain economies of scale by combining administrative and advertising services and eliminating duplication in other areas. Applying the statutory criteria, it is concluded that the proposed transaction is in the public interest and will result in no adverse competitive effects. This application is, therefore, approved. NOVEMBER 1, 1974. SUMMARY OF REPORT BY ATTORNEY GENERAL The merging banks are both wholly-owned subsidiaries of the same bank holding company. As such, their proposed merger is essentially a corporate reorganization and would have no effect on competition. HARRISON COUNTY NATIONAL BANK, HOPEDALE, OHIO, AND THE FREEPORT STATE BANK, FREEPORT, OHIO Banking offices Name of bank and type of transaction Total assets In operation The Freeport State Bank, Freeport, Ohio, with and Harrison County National Bank, Hopedale, Ohio (6938), which had merged Dec. 21, 1974, under charter and title of the latter bank (6938). The merged bank at date of merger had COMPTROLLER S DECISION On August 21, 1974, Harrison County National Bank, Hopedale, Ohio and The Freeport State Bank, Freeport, Ohio applied to the Comptroller of the Currency for permission to merge under the charter and title of the former. Harrison County National Bank, the charter bank, was organized in 1903 and currently has assets of $9 million and IPC deposits of $7.7 million. It is a member of First Steuben Bancorp, Inc., Steubenville, Ohio, the 12th largest of 16 multi-bank holding companies in the State, which controls three banks with aggregate deposits of $145.3 million. The charter bank serves a predominantly coal mining and industrial area with a total population of 7,900. In October 1974, the charter bank will open its first branch 4 miles from its Hopewell office in Cadiz, Ohio, the county seat of Harrison County, which has an estimated population of 3,200. Competition is provided by First National Bank of Cadiz, with total deposits of $15.6 million, which is a member of BancOhio Corporation, the largest multi-bank holding company in the State, and Scio Bank Company, Scio, with deposits of $9.3 million. Freeport State Bank, the merging bank, is a unit institution chartered in 1915 and currently has assets of $2.5 million and IPC deposits of $2.1 million. 104 To be operated $' 2,866,775 9,505,483 12,372,258 The merging bank serves the village of Freeport and the surrounding area. Major competitors are First National Bank of Cadiz; Citizens National Bank of Flushing, with deposits of $10.7 million; and The Community National Bank, Flushing, with deposits of $9.6 million. Competition between the merging bank and the charter bank is minimal. The two banks are located 23 miles apart and direct competition is minimized by the intervening First National Bank of Cadiz. Geographical barriers effectively split Harrison County into two parts with the merging and charter banks situated in separate halves. Consummation of the proposed transaction will have no adverse effect on competition. Competition in the merging bank's service area will be stimulated because the resulting bank will be able to compete more effectively in this area by offering a significantly higher lending limit, automated accounting to provide monthly statements on demand accounts, other electronic data processing services, and trust services through affiliation with the holding company. The proposed merger will also make available specialized management expertise in such areas as farm and commercial loans, bond portfolio management, interest control and audit procedures, and other areas of banking not developed by the merging bank in the past. Applying the statutory criteria, it is concluded that the proposed transaction is in the public interest and this application is, therefore, approved. NOVEMBER 21, 1974. SUMMARY OF REPORT BY ATTORNEY GENERAL We have reviewed this proposed transaction and conclude that it would not have a substantial competitive impact. FIRST NATIONAL BANK OF SPRINGFIELD, SPRINGFIELD, V T . , AND THE FIRST NATIONAL BANK OF FAIR HAVEN, FAIR HAVEN, V T . , AND THE NORTHFIELD NATIONAL BANK, NORTHFIELD, VT. Banking offices Total assets Name of bank and type of transaction In operation The Northfield National Bank, Northfield, Vt. (1638), with and The First National Bank of Fair Haven, Fair Haven, Vt. (344), with and First National Bank of Springfield, Springfield, Vt. (122), which had merged Dec. 30, 1974, under charter and title of the latter bank (122). The merged bank at date of merger had COMPTROLLER'S DECISION On August 29, 1974, The Northfield National Bank, Northfield, Vt., The First National Bank of Fair Haven, Fair Haven, Vt., and First National Bank of Springfield, Springfield, Vt., applied to the Comptroller of the Currency for permission to merge under the charter and with the title of the latter. First National Bank of Springfield, the charter bank, was organized in 1863 and presently operates three branches. It has total assets of $28 million and IPC deposits of $22.8 million. The primary service area of the charter bank encompasses the southcentral section of the eastern border of Vermont. The economy of this service area is supported by the precision tool industry and agriculture. Competition for the charter bank is provided by Vermont National Bank, Brattleboro, Vt., with deposits of $91.8 million and Connecticut River National Bank, Charlestown, N.H., with deposits of $9.4 million. The Northfield National Bank, one of the two merging banks, was organized in 1866 and presently operates as a unit bank with total assets of $4.9 million and IPC deposits of $4.3 million. The primary service area of this merging bank encompasses the town of Northfield and the immediately surrounding area. Northfield is a bedroom community for commuters employed in Barre and Montpelier. Competition for The Northfield National Bank is provided by The Merchants National Bank, Bur % 4,560,089 5,726,429 30,688,474 39,836,587 To be operated 1 1 4 6 lington, with deposits of $67.6 million and Northfield Savings Bank, Northfield, with deposits of $40.1 million. The First National Bank of Fair Haven, the second merging bank, was organized in 1864 and presently operates as a unit bank with total assets of $5.7 million and IPC deposits of $5.2 million. The primary service area of this merging bank encompasses the west-central section of Vermont along the New York border. While there exists some agricul*tural and commercial activity within this service area, most of its residents are employed in nearby Rutland, Vt., and Whitehall, N.Y. Competition for The First National Bank of Fair Haven is provided by The First Vermont Bank and Trust Company, Brattleboro, with deposits of $143 million; Vermont National Bank, Brattleboro, with deposits of $91.8 million; and Proctor Trust Company, Proctor, with deposits of $44.8 million. There is no competition among the three banks involved in the proposed merger because their nearest two offices are separated by a distance of 40 miles and an adequate number of alternative banking facilities operate in the intervening area. Consummation of the proposed merger will have little effect in the service area of the charter bank. However, in the service areas of the two merging banks, the increased lending limit of the resulting bank will enable it to satisfy the ever growing demand of the residents and businesses of Fair Haven and Northfield for a broader range of credit. In addition, consummation of the proposed merger 105 will alleviate the managerial problems of The Northfield National Bank and The First National Bank of Fair Haven. Applying the statutory criteria, it is concluded that the proposed merger is in the public interest and this application is, therefore, approved. NOVEMBER 11, 1974. SUMMARY OF REPORT BY ATTORNEY GENERAL The city of Northfield is located some 80 miles north, and Fair Haven some 60 miles northwest, of Springfield. Northfield and Fair Haven are about 65 miles from each other; no office of the three banks is closer than 40 miles. The proposed consolidation will not eliminate significant existing competition. The economies of the respective areas served by the three banks are basically sound; over all growth in each is, however, limited. Springfield Bank, largest of the three, is only the 10th largest bank in the State with 2.3 percent of total deposits as compared to 16.2 percent, 13.5 percent and 11.5 percent held by the three largest banks in the State. None of the applicant banks is a particularly likely de novo entrant into the areas served by the others. The proposed consolidation of the three would not have a significantly adverse effect on potential competition. NEW JERSEY BANK (NATIONAL ASSOCIATION), CLIFTON, N.J., WESTWOOD, WESTWOOD, AND THE FIRST NATIONAL BANK OF N.J. Banking offices Total assets Name of bank and type of transaction In operation The First National Bank of Westwood, Westwood, N.J. (8777), with and New Jersey Bank (National Association), Clifton, N.J. (15709), which had merged Dec. 30, 1974, under charter and title of the latter bank (15709). The merged bank at date of merger had COMPTROLLER'S DECISION On August 8, 1974, The First National Bank of Westwood, Westwood, N.J., and New Jersey Bank (National Association), Clifton, N.J., applied to the Comptroller of the Currency for permission to merge under the charter and with the title of the latter. New Jersey Bank (National Association), the charter bank, was organized in 1869 and presently operates 31 branches. It has total assets of $745 million and IPC deposits of $543 million. The charter bank is the principal subsidiary of Greater Jersey Bancorp, Clifton, N.J., the sixth largest bank holding company in the State. The primary service area of the charter bank encompasses the cities of Passaic and Paterson together with their surrounding areas. The economy of the service area is supported by a wide array of commercial and industrial activity. New Jersey Bank (National Association) also has an application pending to merge with Fairfield National Bank, Fairfield, N.J. Competition for the charter bank is provided by 11 commercial banks headquartered in Passaic County, the largest of which are First National State Bank of New Jersey, Newark, with deposits of $1.1 bil- 106 $ 37,882,853 752,139,150 783,462,337 To be operated 2 33 35 lion, which is a member of First National State Bancorporation; Peoples Trust of New Jersey, Hackensack, with deposits of $957 million, which is a member of United Jersey Banks; and Midlantic National Bank, Newark, with deposits of $860 million, which is a member of Midlantic Banks, Inc. Additional competition is provided by the multibillion dollar banks headquartered in nearby New York City. The First National Bank of Westwood, the merging bank, was organized in 1907 and presently operates one branch. It has total assets of $38.2 million and IPC deposits of $31.9 million. The primary service area of the merging bank consists of the borough of Westwood and Washington Township. That area serves as a bedroom community for those employed in Newark and New York City. Competition for The First National Bank of Westwood is provided by Peoples Trust of New Jersey, Hackensack, with deposits of $957 million, which is a member of United Jersey Banks; National Community Bank of Rutherford, with deposits of $638 million; Garden State National Bank, Hackensack, with deposits of $467 million; and Citizens First National Bank of New Jersey, Ridgewood, with deposits of $207 million. Additional competition is provided by the multi-billion dollar banks headquartered in New York City. Although the closest offices of the charter and merging banks are separated by a distance of only 1.3 miles, there is minimal competition between them. The relatively small size of the merging bank and the limited nature of its services prevent it from being a significant competitor for the charter bank. In addition, an adequate number of alternative banking facilities operate in the intervening area. Furthermore, no other subsidiary of Greater Jersey Bancorp is located within 13 miles of The First National Bank of West wood. Consummation of the proposed merger will stimulate competition in the service area of the merging bank because the resulting branches in the borough of Westwood and Washington Township will offer new and improved services such as a larger lending limit, overdraft banking, automatic teller machines, a wider variety of loans, international banking, trust department services, and electronic data processing services. Consummation of the proposed merger will also remove head office protection from the borough of Westwood and open that community to de novo branching by other banks. The resulting bank will become the fifth largest bank in the State and Greater Jersey Bancorp will continue to rank sixth in size among the bank holding companies in the State. Applying the statutory criteria, it is concluded that the proposed merger is in the public interest and this application is, therefore, approved. NOVEMBER 29, 1974. SUMMARY OF REPORT BY ATTORNEY GENERAL Applicant operates four branch offices in eastcentral Bergen County in northern New Jersey in close proximity to Bank's two locations, as well as a fifth office in the western portion of the county and sixth office in the county's southeastern corner. Four of Applicant's branches are clustered within about 7 miles of Bank's two locations, and their nearest offices are separated by only about 2 miles. Thus, it appears that the proposed merger would eliminate existing competition. While each party to the proposed transaction holds only a small percentage of Bergen County's commercial bank deposits, it appears that these deposits are to a large extent derived from the northcentral portion of the county denominated in the application as the Pascack Valley. The proposed merger would increase concentration in commercial banking in this area, and would have at least some adverse effect on competition. WACHOVIA BANK AND TRUST COMPANY, N.A., WINSTON-SALEM, N.C., MARSHALL, N.C. AND CITIZENS BANK, Banking offices Name of bank and type of transaction Total assets Citizens Bank, Marshall, N . C , with and Wachovia Bank and Trust Company, N.A., Winston-Salem, N.C. (15673), which had merged Dec. 30, 1974, under charter and title of the latter bank (15673). The merged bank at date of merger had COMPTROLLER'S DECISION On May 16, 1974, Wachovia Bank and Trust Company, N.A., Winston-Salem, N . C , and Citizens Bank, Marshall, N . C , applied to the Comptroller of the Currency for permission to merge under the charter and with the title of the former. Wachovia Bank and Trust Company, N.A., the charter bank, was organized in 1879 and now, with total assets of $3.2 billion and IPC deposits of $2 $ 16,584,986 2,975,719,479 2,992,304,465 In To be operation operated 4 192 196 billion, is the second largest bank in North Carolina. The charter bank, a subsidiary of Wachovia Corporation, a one-bank holding company, operates 172 offices throughout the State of North Carolina. Citizens Bank, the merging bank, was established in 1910 and now operates two offices in Mars Hill and one office at Hot Springs. The merging bank's service area is Madison County, which is located in the extreme northwestern portion of the State adjacent to the Tennessee State line. Citizens Bank has 107 total assets of $16.3 million and IPC deposits of $13 million. The merging bank competes with offices of First Union National Bank, Charlotte, the third largest bank in the State with deposits of $1.5 billion, and Northwestern Bank, North Wilkesboro, the fifth largest bank in the State with deposits of $880 million. The charter bank is a vigorous competitor and competes with every major bank in the southeast. In North Carolina its primary competitors are North Carolina National Bank, Charlotte, with 148 offices and $3 billion in deposits; First Union National Bank of North Carolina, Charlotte, with 181 banking offices and $1.5 billion in deposits; First Citizens Bank and Trust, Smithfield, with 193 offices and $1 billion in deposits; and Northwestern Bank with 151 offices and $880 million in deposits. Competition between the charter and merging banks is minimal, if any exists at all, since Wachovia Bank and Trust Company's closest office is located in Asheville, 22 miles south of Marshall. Although charter bank could branch de novo into the Madison County service area, there is little economic incentive for such a move since the area is experiencing a decline in both population and economic growth. Citizens Bank, like many small town institutions in similar circumstances, has aging management and offers limited services. Consummation of the subject merger will replace this small and struggling bank with the resources of a well-managed larger bank. The public will benefit from the availability of a wider range of banking services including a significantly larger lending limit which may serve to stimulate the economic environment in Madison 108 County. The resulting bank will remain the second largest in North Carolina. Applying the statutory criteria, it is concluded that the proposed merger is in the public interest and this application is, therefore, approved. NOVEMBER 26, 1974. SUMMARY OF REPORT BY ATTORNEY GENERAL Wachovia's offices nearest to Citizens are located in Asheville (population 57,681), Buncombe County, which is about 25 miles from Citizens' main office in Marshall and about 21 miles and 37 miles from its branches in Mars Hill and Hot Springs, respectively. The application indicates that Wachovia draws some $1.2 million in deposits (excluding correspondent balances from Citizens) and $269,000 in loans from the three towns in which Citizens has offices. The application also indicates that many workers in Madison County travel to Asheville for employment. Accordingly, the proposed transaction would eliminate some existing competition. Citizens accounts for the largest share of deposits (about 51 percent) held in banking offices in Madison County. The Marshall branch of First Union National Bank, the State's third largest bank, accounts for the second largest share. In addition, The Northwestern Bank, the fifth largest bank in the State, recently opened an office in Marshall, and has approval to open an office in Mars Hill. In view of below average economic growth in Madison County, the recent entry of other banks and the existence of other potential entrants, this proposed transaction would not appear to have a substantial effect on potential competition. FIRST NATIONAL BANK OF SOUTH CAROLINA, COLUMBIA, S.C., LAKE CITY, S.C. AND PALMETTO BANK & TRUST COMPANY, Banking offices Name of bank and type of transaction Total assets Palmetto Bank & Trust Company, Lake City, S.C, with and First National Bank of South Carolina, Columbia, S.C. (13720), which had merged Dec. 31, 1974, under charter and title of the latter bank (13720). The merged bank at date of merger had COMPTROLLER'S DECISION On May 10, 1974, Palmetto Bank & Trust Company, Lake City, S . C , and First National Bank of South Carolina, Columbia, S . C , applied to the Comptroller of the Currency for permission to merge under the charter and with the title of the latter. First National Bank of South Carolina, the charter bank, was organized in 1933 and now has assets of $474 million and IPC deposits of $316 million. It operates 62 branches in 21 of South Carolina's 46 counties which include the most heavily populated counties in the State. The retail service area of this bank includes the areas immediately surrounding its numerous branches but, for wholesale banking services, the charter bank serves the entire State of South Carolina as well as the southeast region of the United States. Competition for the charter bank is provided by offices of South Carolina National Bank, Columbia, with deposits of $786 million; Citizens and Southern National Bank of South Carolina, Columbia, with deposits of $468 million; and Bankers Trust of South Carolina, Columbia, with deposits of $421 million. Palmetto Bank and Trust Company, the merging bank, was organized in 1935 and currently has one branch. The bank's assets are $12.6 million with IPC deposits of $10 million. Both the merging bank's main office and branch are located in Lake City, Florence County, and its service area extends into * These figures represent the standing at the start of a business day on which two mergers were effected, and after those actions had occurred, and so reflect both this merger and that of The Bank of Walterboro, following. $ 14,351,449 511,034,589* In To be operation operated 2 60 532,638,256* 62 Williamsburg County and Clarendon County. The entire service area of the bank contains an estimated population of 23,000 persons. The merging bank is slightly larger than the only other commercial bank operating in its service area. That competitor, Lake City State Bank, has deposits of $9.8 million. There is minimal competition between the charter and merging banks because their closest two offices are separated by 24 miles and by natural barriers such as the Lynches River, which is situated in the intervening area. There are also other alternative banking facilities operating in the area. Consummation of the proposed merger should stimulate competition in the service area of the merging bank because the resulting branch in Lake City will offer new and improved services that have not previously been offered in Lake City. This should induce Lake City State Bank to develop additional services to offer to the public. The merger will also resolve the acute management succession problem at the merging bank. The resulting bank will remain the fourth largest commercial bank in South Carolina. Applying the statutory criteria, it is concluded that the proposed merger is in the public interest and this application, is, therefore, approved. NOVEMBER 4, 1974. SUMMARY OF REPORT BY ATTORNEY GENERAL We have reviewed this proposed transaction and conclude that it would not have a substantial competitive impact. 109 FIRST NATIONAL BANK OF SOUTH CAROLINA, COLUMBIA, S.C., WALTERBORO, AND THE BANK OF WALTERBORO, S.C. Banking offices Total assets Name of bank and type of transaction In operation The Bank of Walterboro, Walterboro, S . C , with and First National Bank of South Carolina, Columbia, S.C. (13720), which had merged Dec. 31, 1974, under charter and title of the latter bank (13720). The merged bank at date of merger had COMPTROLLER'S DECISION On November 16, 1973, First National Bank of South Carolina, Columbia, S . C , and The Bank of Walterboro, Walterboro, S . C , applied to the Comptroller of the Currency for permission to merge under the charter and with the title of the former. First National Bank of South Carolina, the charter bank, was organized in 1933 and presently operates 56 branches throughout the State with total assets of $415 million and IPC deposits of $337 million. The charter bank is owned by First Bankshares Corporation of South Carolina, a holding company which also owns one other subsidiary, First National Properties, Inc., Charleston, a real estate holding company for properties utilized by the charter bank. The charter bank has also filed an application to merge into itself The Security Bank, Edgefield, S.C. Since the charter bank offers a full range of services in 23 communities throughout the State, it is in competition with most of the State's largest banks. The major direct competition for the charter bank is provided by South Carolina National Bank, with deposits of $664 million; Citizens and Southern National Bank, with deposits of $430 million; Bankers Trust of South Carolina, with deposits of $399 million; First Citizens Bank and Trust Company, with deposits of $131 million; Southern Bank and Trust Company, with deposits of $118 million; and American Bank and Trust, with deposits of $110 million. All of those competing banks have offices throughout the State. The Bank of Walterboro, the merging bank, was organized in 1923 and presently operates a single office with assets of $12.7 million and IPC deposits of $11.5 million. The primary service area of the merging bank extends for a radius of approximately 10 miles from Walterboro, into the predominantly * These figures represent the standing at the start of a business day on which two mergers were effected, and after those actions had occurred, and so reflect both this merger and that of Palmetto Bank & Trust Company, preceeding. 110 $ 12,621,018 511,034,589* To be operated 2 62 532,638,256* 64 rural low country of Colleton County. The principal economic activity in its service area is agriculture. Competition in the service area of the merging bank is provided by Farmers and Merchants Bank, Walterboro, with deposits of $36 million, and by the Walterboro branch of the $42 million deposit First National Bank in Orangeburg. There is no direct competition between the charter and merging banks because of the distance that separates the two banks. The nearest office of the charter bank is located in Summerville, 31 miles from Walterboro. There is no significant commercial activity between Walterboro and Summerville, and the intervening area is almost entirely forest and marshland. Consummation of the proposed merger will stimulate competition in the service area of the merging bank because the resulting branch in Walterboro will be able to offer new and improved services to the community such as a trust and travel department, real estate loans, a larger lending limit, mortgage banking, and computer services. In addition, the proposed merger will alleviate the merging bank's management deficiencies because of the availability of the charter bank's well-rounded training program and management depth. Applying the statutory criteria, it is concluded that the proposed merger is in the public interest and this application is, therefore, approved. NOVEMBER 4, 1974. SUMMARY OF REPORT BY ATTORNEY GENERAL The nearest branch of FNB-SC is located in contiguous Dorchester County in the city of Summerville, some 30 miles northeast of Walterboro. The amount of direct competition which might be eliminated by the proposed acquisition would be limited. Colleton County is served by only three banks, all located in Walterboro. Walterboro Bank is the second largest of the three banks and holds 35.5 percent of the county's total deposits of $32.5 million. There are at present seven banks in South Carolina with deposits in excess of $100 million; five of these, including FNB-SC, operate offices throughout the major portions of the State and could legally establish de novo offices in the general Walterboro/ Colleton County area. However, because of limited economic growth in the area and the number of other potential entrants, the proposed acquisition of Walterboro Bank would not, in our view, eliminate substantial potential competition. THE CENTRAL TRUST COMPANY OF MONTGOMERY COUNTY, NATIONAL ASSOCIATION, DAYTON, OHIO, AND THE FARMERS AND MERCHANTS BANK OF ENGLEWOOD, ENGLEWOOD, OHIO Banking offices Name of bank and type of transaction Total assets In operation The Farmers and Merchants Bank of Englewood, Englewood, Ohio, with and The Central Trust Company of Montgomery County, National Association, Dayton, Ohio (16330), which had merged Dec. 31, 1974, under charter and title of the latter bank (16330). The merged bank at date of merger had COMPTROLLER'S DECISION On August 28, 1974, The Farmers and Merchants Bank of Englewood, Englewood, Ohio, and The Central Trust Company of Montgomery County, National Association, Dayton, Ohio, applied to the Comptroller of the Currency for permission to merge under the charter and with the title of the latter. The Central Trust Company of Montgomery County, the charter bank, commenced operations in May 1974, and presently operates as a unit bank with total assets of $3.8 million and IPC deposits of $1.7 million. The charter bank is a subsidiary of Central Bancorporation, Cincinnati, Ohio, the eighth largest bank holding company in the State. The primary service area of the charter bank encompasses the downtown area of Dayton. The economy of that service area is supported by a wide array of commercial, financial, and industrial activity. Competition for The Central Trust Company of Montgomery County, National Association, is provided by Winters National Bank and Trust Company, Dayton, with deposits of $554 million; The Third National Bank and Trust Company, Dayton, with deposits of $287 million; The First National Bank, Dayton, with deposits of $282 million; and The Unity State Bank, Dayton, with deposits of $7.3 million. The Farmers and Merchants Bank of Englewood, Englewood, Ohio, the merging bank, was organized in 1969 and presently operates one branch. It has total assets of $8.2 million and IPC deposits of $5.9 million. The primary service area of the merging bank encompasses the towns of Englewood and To be operated $ 7,473,617 8,631,213 16,104,831 Brookville and their immediately surrounding areas. While there is significant agricultural activity in this service area, most of its residents are employed in Dayton. Competition for The Farmers and Merchants Bank of Englewood is provided by The First National Bank, Dayton, with deposits of $282 million and Brookville National Bank, Brookville, with deposits of $12.2 million. There is only minimal competition between the charter and merging banks because they are separated by a distance of 10 miles and an adequate number of alternative banking facilities operate in the intervening area. In addition, the relatively small size and limited scope of operations of the charter and merging banks prevent them from effectively competing with each other. The closest existing subsidiary of The Central Bancorporation is Central Trust Company, Cincinnati, which is approximately 50 miles from Englewood. Consummation of the proposed merger will stimulate competition in Montgomery County because the resulting branch in Englewood will be able to offer new and improved services such as expanded mortgage lending, credit card loans, overdraft checking, single statement banking, and trust services. In addition, the merging bank will benefit from the managerial assistance provided by the charter bank's experienced lending officers and from the expertise of other lending specialists employed by Central Bancorporation's other subsidiaries. Furthermore, the resulting bank would continue to rank among the smallest banks in Montgomery County. Ill Applying the statutory criteria, it is concluded that the proposed merger is in the public interest and this application is, therefore, approved. NOVEMBER 4, 1974. SUMMARY OF REPORT BY ATTORNEY GENERAL We have reviewed this proposed transaction and conclude that it would not have a substantial competitive impact. THE NATIONAL BANK OF RICHMOND, RICHMOND, MICH., AND N E W HAVEN SAVINGS BANK, NEW HAVEN, MICH. Name of bank and type of transaction Total assets Banking offices In operation New Haven Savings Bank, New Haven, Mich., with and The National Bank of Richmond, Richmond, Mich. (13793), which had merged Dec. 31, 1974, under charter and title of the latter bank (13793). The merged bank at date of merger had COMPTROLLER'S DECISION On July 5, 1974, New Haven Savings Bank, New Haven, Mich., and The National Bank of Richmond, Richmond, Mich., applied to the Comptroller of the Currency for permission to merge under the charter and with the title of the latter. The National Bank of Richmond, the charter bank, was organized in 1915 and now, with assets of $33.2 million and IPC deposits of $27.9 million, operates one branch office in Memphis, Mich. The charter bank has pending two applications for permission to establish new branches. The service area of the bank is essentially Richmond and its environs, a rapidly developing area northeast of Detroit that is currently industrial and agricultural in character, with an estimated population in excess of 22,685. The charter bank ranks fourth in size among the seven banks operating within a 15-mile radius of the applicant banks. Competition is provided by Macomb County Bank, Richmond, with deposits of $9.8 million; the Armanda branch of First National Bank in Mt. Clemens, with deposits of $125.4 million; and the Emmett branch of Commercial and Savings Bank of St. Clair County, St. Clair, with deposits of $58.2 million. New Haven Savings Bank, the merging bank, was organized in 1901 and now, with assets of $6.2 million and IPC deposits of $4.9 million, operates one branch office in Meade, Mich. The merging bank, also located in Macomb County, has a service area that includes the village of New Haven and its environs. The economy of the New Haven Savings Bank's service area is essentially the same as the 112 To be operated $ 5,474,903 33,622,896 39,097,799 National Bank of Richmond's service area in character except there has been greater residential development and a greater change from rural to suburban. The population of the merging bank's service area is an estimated 13,280. The merging bank is the smallest of the seven commercial banking institutions operating in the vicinity of the Richmond and New Haven communities. It competes primarily with First National Bank in Mt. Clemens and Mt. Clemens Bank, Mt. Clemens, with deposits of $91.5 million. Competition is also provided the merging bank by Citizens State Savings Bank in nearby New Baltimore, with deposits of $11.8 million; and Macomb County Bank. There is no significant competition between the closest offices of the charter and merging banks. Although the two banks are only separated by a distance of 7.5 miles, a branch office of a competitor located in the intervening area and the poor quality of direct roads between the communities in which each bank has offices precludes the possibility of significant competition. The small size and unaggressive nature of the merging bank also deters competition with the charter bank. Consummation of the proposed merger will not diminish competition in the service area of the merging bank. On the contrary, the branches of the resulting bank in New Haven and Meade will offer new and improved services including a significantly larger lending limit and the payment of competitive rates on time and saving deposits. This will make the branches of the resulting bank more viable competitors within what is now the merging bank's service area. Additionally, the merger will provide an institution capable of accommodating the increasing demand for banking services in this developing area and an opportunity to expand its services even though its location prevents attraction of new youthful management to supplement the current staff. The resulting bank, with IPC deposits of $32.8 million, will remain the fourth largest of the remaining six commercial banks operating in the vicinity of Richmond and New Haven. Applying the statutory criteria, it is concluded that the proposed merger is in the public interest and this application is, therefore, approved. NOVEMBER 18, 1974. SUMMARY OF REPORT BY ATTORNEY GENERAL The main offices of the parties (their closest) are separated by a distance of about 7 miles, with the offices of another bank roughly intervening between them. The proposed transaction would appear to eliminate some existing competition between the banks as well as the potential for increased future competition. However, in view of New Haven Bank's modest size and the presence of several convenient banking alternatives in the area immediately surrounding New Haven, we conclude that, overall, the proposed merger would not have a significantly adverse effect on competition. 113 //. Mergers consummated, pursuant to corporate reorganization THE FARMERS NATIONAL BANK OF SALEM, SALEM, OHIO, AND NORTHERN COLUMBIANA COUNTY NATIONAL BANK, SALEM, OHIO Banking offices Total assets Name of bank and type of transaction In operation On August 3, 1973, The Farmers National Bank of Salem, Salem, Ohio, and the Northern Columbiana County National Bank (organizing), Salem, Ohio, applied to the Comptroller of the Currency for permission to merge under the charter of the latter and title of the former. The Farmers National Bank of Salem, the merging bank, is headquartered in Salem, Columbiana County, and has seven offices in the county. The bank, with total deposits of approximately $52 million, was chartered originally in 1846. It competes directly with First National Bank of Salem, which has total deposits of approximately $36 million. Northern Columbiana County National Bank, the charter bank, is being organized to provide a vehicle by which to transfer ownership of the merging bank to First Steuben Bancorp, Inc., a registered bank holding company in Ohio. The charter bank will not be operating as a commercial bank prior to the merger. First Steuben Bancorp, Inc., with total assets of approximately $95 million was organized in 1969. The holding company is headquartered in Steubenville, Jefferson County, Ohio, and has two subsidiaries, The First National Bank and Trust Company in Steubenville, with total deposits of approximately $88 million, and The First National Bank of Hopedale, Ohio, with total deposits of approximately $9 million. First Steuben Bancorp ranks ninth in size of 10 leading holding companies in Ohio. The proposed merger will not adversely affect 114 60,043,372 • COMPTROLLER S DECISION $59,923,858 119,515 OOO The Farmers National Bank of Salem, Salem, Ohio (973), with and Northern Columbiana County National Bank, Salem, Ohio (973), which had merged Jan. 1, 1974, under charter of the latter bank (973) and title "The Farmers National Bank of Salem." The merged bank at date of merger had To be operated 8 competition due to the distance and intervening banking facilities involved. First Steuben Bancorp's closest subsidiary office to the merging bank is the Toronto office of The First National Bank and Trust Company in Steubenville, which is 30 miles distant from the merging bank's Lisbon office. Furthermore, the proposed merger will not significantly change the relative position of First Steuben Bancorp with regard to other multi-bank holding companies in Ohio. Consummation of the merger will, however, significantly enhance the resulting bank's ability to compete in its service area. Affiliation with First Steuben Bancorp will enable the resulting bank to offer more diversified and specialized services to area customers through the holding company's expertise. Accordingly, applying the statutory criteria, it is concluded that the proposed merger is in the public interest. The application is, therefore, approved. NOVEMBER 30, 1973. SUMMARY OF REPORT BY ATTORNEY GENERAL The proposed merger is part of a plan through which Farmers National Bank of Salem would become a subsidiary of First Steuben Bancorp, Inc., a bank holding company. The instant merger, however, would merely combine an existing bank with a non-operating institution; as such, and without regard to the acquisition of the surviving bank by First Steuben Bancorp, Inc., it would have no effect on competition. FIDELITY BANK, NATIONAL ASSOCIATION, OKLAHOMA CITY, OKLA., AND FIDELITY NATIONAL BANK, OKLAHOMA CITY, OKLA. Banking offices Total assets Name of bank and type of transaction In operation $279,726,714 249,583 Fidelity Bank, National Association, Oklahoma City, Okla. (12016), with and Fidelity National Bank, Oklahoma City, Okla. (12016), which had merged Jan. 2, 1974, under charter of the latter bank (12016) and title "Fidelity Bank, N.A." The merged bank at date of merger had COMPTROLLER S DECISION On May 30, 1973, the Fidelity Bank, National Association, Oklahoma City, Okla., and the Fidelity National Bank (organizing), Oklahoma City, Okla., applied to the Comptroller of the Currency for permission to merge under the charter of the latter and with the title "Fidelity Bank, N.A." Fidelity Bank, National Association, the merging bank, is headquartered in Oklahoma City, and operates as a unit institution. The bank, with total resources of $208.1 million and IPC deposits of $151.5 million was chartered originally in 1908. The merging bank has one affiliate, Capitol Hill State Bank and Trust, Oklahoma City. Affiliation occurred in 1960, when shareholders owning a majority of the stock of Capitol Hill State Bank and Trust purchased a majority of the outstanding shares of the merging bank. Fidelity National Bank, the charter bank, is being organized to provide a vehicle to transfer ownership of the merging bank to the Fidelity Corporation of Oklahoma, Oklahoma City, Okla. The charter bank will not be operating as a commercial bank prior to To be operated 2 0 2 279,733,914 the merger. Because the merging bank is the only operating bank involved in the proposed transaction, there can be no adverse effect on competition resulting from consummation of the proposed merger. The resulting bank will conduct the same banking business at the same location and with the same name as presently used by the merging bank. Applying the statutory criteria, it is concluded that the proposed merger is in the public interest and the application is, therefore, approved. OCTOBER 31, 1973. SUMMARY OF REPORT BY ATTORNEY GENERAL The proposed merger is part of a plan through which Fidelity Bank, National Association would become a subsidiary of Fidelity Corporation of Oklahoma, a bank holding company. The instant merger, however, would merely combine an existing bank with a non-operating institution; as such, and without regard to the acquisition of the surviving bank by Fidelity Corporation of Oklahoma, it would have no effect on competition. THE FIRST NATIONAL BANK OF CINCINNATI, CINCINNATI, OHIO, AND FN NATIONAL BANK, CINCINNATI, OHIO Banking offices Name of bank and type of transaction Total assets In operation The First National Bank of Cincinnati, Cincinnati, Ohio (24), with and FN National Bank, Cincinnati, Ohio (24), which had merged Jan. 2, 1974, under charter of the latter bank (24) and title "The First National Bank of Cincinnati." The merged bank at date of merger had COMPTROLLER S DECISION On October 12, 1973, FN National Bank (organizing), Cincinnati, Ohio, and The First National Bank of Cincinnati, Cincinnati, Ohio, applied to the $1,062,401,438 243,500 1,147,601,909 To be operated 24 0 24 Comptroller of the Currency for permission to merge under the charter of the former and with the title of the latter. The First National Bank of Cincinnati, the existing bank, was organized in 1863 and now, with deposits 115 of $719.5 million, is the largest of the six banks headquartered in Cincinnati. The two largest competitors for the bank are The Central Trust Company, with deposits of $592 million, which is a member of The Central Bancorporation, and The Fifth Third Bank, with deposits of $554.9 million. FN National Bank, is being organized to provide a vehicle by which to transfer ownership of the existing bank to First National Cincinnati Corporation, Cincinnati, Ohio, which will become a one-bank holding company. FN National Bank will not be operating as a commercial bank prior to this merger. Because The First National Bank of Cincinnati is the only operating bank involved in the proposed transaction, there can be no adverse effect on competition resulting from consummation of the proposed merger. The resulting bank will conduct the same banking business at the same locations and with the same name as presently used by the existing bank. Applying the statutory criteria, it is concluded that the proposed merger is in the public interest, and this application is, therefore, approved. NOVEMBER 29, 1973. SUMMARY OF REPORT BY ATTORNEY GENERAL The proposed merger is part of a plan through which First National Bank of Cincinnati would become a subsidiary of First National Cincinnati Corporation, a bank holding company. The instant merger, however, would merely combine an existing bank with a non-operating institution; as such, and without regard to the acquisition of the surviving bank by First National Cincinnati Corporation, it would have no effect on competition. FIRST NATIONAL BANK IN GRAND PRAIRIE, GRAND PRAIRIE, T E X . , AND SECOND NATIONAL BANK IN GRAND PRAIRIE, GRAND PRAIRIE, TEX. Banking offices Name of bank and type of transaction Total assets In operation First National Bank in Grand Prairie, Grand Prairie, Tex. (14576), with and Second National Bank in Grand Prairie, Grand Prairie, Tex. (14576), which had merged Jan. 18, 1974, under charter of the latter bank (14576) and title "First National Bank in Grand Prairie." The merged bank at date of merger had COMPTROLLER'S DECISION On September 20, 1973, First National Bank in Grand Prairie, Grand Prairie, Tex., and Second National Bank in Grand Prairie (organizing), Grand Prairie, Tex., applied to the Comptroller of the Currency for permission to merge under the charter of the latter and with the title of the former. First National Bank in Grand Prairie, the existing bank, was organized in 1947 and has operated as a unit institution since that time, as required under Texas law. The bank currently has deposits of $20.5 million. The primary service area of the bank consists of the city of Grand Prairie with an estimated population of 50,904 persons. First National Bank in Grand Prairie is the second largest of three banks headquartered in Grand Prairie and ranks 41st in deposit size among all banks in the Dallas area. Competition for the bank is provided by Grand Prairie State Bank, with deposits of $25.2 million, and by Midway National 116 $27,596,826 250,000 28,271,365 To be operated 1 0 1 Bank, Grand Prairie, with deposits of $16.1 million. Additional competition will soon be provided by a recently chartered bank, National Bank of Grand Prairie, which has not yet opened for business. Second National Bank in Grand Prairie, the receiving bank, is being organized to provide a vehicle by which to transfer ownership of First National Bank in Grand Prairie to First Security National Corporation. The new bank will not be operating as a commercial bank prior to this merger. First Security National Corporation, the bank holding company which will acquire the resulting bank, was organized in June 1969 and now controls eight banks with aggregate deposits of approximately $230.4 million. The holding company also controls Security First Mortgage Company, its principal non-banking subsidiary, and has submitted an application to acquire Texas National Bank, Dallas, with deposits of $7.6 million. There is minimal competition between the applicant or its subsidiaries and First National Bank in Grand Prairie because of the distances that separate their closest two offices and because an adequate number of alternative banking facilities operate in the intervening area. The nearest office of an existing subsidiary of the applicant is in Lancaster, Tex., approximately 20 miles from the main office of the resulting subsidiary. Further, if the applicant receives approval of its pending application to acquire Texas National Bank of Dallas, Dallas, that bank will become the nearest subsidiary to First National Bank in Grand Prairie. It is located 13 miles to the east. Consummation of the proposed merger will stimulate competition in Grand Prairie because the resulting subsidiary will be able to offer expanded expertise in all banking services, especially in the field of development, construction, and real estate loans. Additionally, the resulting subsidiary will gain stability and continuity of ownership along with greater depth and continuity of management. Applying the statutory criteria, it is concluded that the proposed merger is in the public interest and this application is, therefore, approved. DECEMBER 18, 1973. SUMMARY OF REPORT BY ATTORNEY GENERAL [This merger is a part] * * * of plans through which the existing banks will become subsidiaries of First Security National Corporation. [It] * * *, however, will merely combine an existing bank with a nonoperating institution and without regard to the acquisition of the surviving banks by First Security National Corporation, will have no effect on competition. TEXAS NATIONAL BANK OF DALLAS, DALLAS, TEX., AND STEMMONS NATIONAL BANK, DALLAS, TEX. Banking offices Total assets Name of bank and type of transaction In operation Texas National Bank of Dallas, Dallas, Tex. (15501), with and Stemmons National Bank, Dallas, Tex. (15501), which had merged Jan. 18, 1974, under charter of the latter bank (15501) and title "Texas National Bank of Dallas." The merged bank at date of merger had COMPTROLLER'S DECISION On September 19, 1973, Texas National Bank of Dallas, Dallas, Tex., and Stemmons National Bank (organizing), Dallas, Tex., applied to the Comptroller of the Currency for permission to merge under the charter of the latter and with the title of the former. Texas National Bank of Dallas, the merging bank, was organized in 1964 and operates as a unit institution. It possesses total assets of $8.7 million and IPC deposits of $6.8 million. The service area of the bank encompasses a portion of suburban Dallas. Competitors of Texas National Bank of Dallas include Republic National Bank of Dallas, with deposits of $2.8 billion; First National Bank of Dallas, with deposits of $2.5 billion, which is a member of International Bancshares, Inc.; and Texas Bank and Trust Company of Dallas, with deposits of $255.2 million. Stemmons National Bank, the charter bank, is being organized to provide a vehicle by which to transfer ownership of the merging bank to First Security National Corporation, Beaumont, Tex., a $10,347,615 250,000 10,597,615 To be operated 1 0 1 registered bank holding company 14th in size in the State. It controls eight subsidiary banks with aggregate deposits of $230.4 million and has applied for approval to acquire one additional bank. First Security National Bank of Beaumont, with deposits of $180 million, is the applicant's lead subsidiary. Competition for First Security National Corporation is provided by the banks located in the Beaumont-Port Arthur-Orange area including The American National Bank which has deposits of $116.1 million and is a member of Texas Commerce Bancshares, Inc.; The First National Bank which has deposits of $83.3 million and is a member of Southwest Bancshares, Inc.; and Merchants Bank which has deposits of $68.8 million and is a member of Allied Bancshares, Inc. Additional competition is generated from the banks located in the Fort Worth and Dallas markets. Competition between the subsidiaries of First Security Corporation and Texas National Bank of Dallas is minimal as their closest offices are separated by a distance of 19 miles and they operate in distinct service areas. 117 Consummation of the proposed transaction will result in no adverse competitive effects. Affiliation with the holding company will allow the resulting bank to offer improved and expanded services, such as an increased lending capacity through loan participations, construction and mortgage lending expertise, improved physical facilities, and data processing services. In addition, the resulting bank will benefit from the improved management expertise which will be provided. Applying the statutory criteria, it is the opinion of this Office that the proposed transaction is in the public interest and will result in no adverse com- petitive effects. This application is, therefore, approved. DECEMBER 18, 1973. SUMMARY OF REPORT BY ATTORNEY GENERAL [This merger is a part] * * * of plans through which the existing banks will become subsidiaries of First Security National Corporation. [It] * * *, however, will merely combine an existing bank with a non-operating institution and without regard to the acquisition of the surviving banks by First Security National Corporation, will have no effect on competition. HAMILTON NATIONAL BANK OF LOUDON, LOUDON, TENN., AND LOUDON BANK, N.A., LOUDON, TENN. Banking offices Name of bank and type of transaction Total assets In operation Hamilton National Bank of Loudon, Loudon, Tenn. (12080), with and Loudon Bank, N.A., Loudon, Tenn. (12080), which had merged Jan. 28,1974, under charter of the latter bank (12080) and title "Hamilton National Bank of Loudon." The merged bank at date of merger had COMPTROLLER'S DECISION On September 12, 1973, Hamilton National Bank of Loudon, Loudon, Tenn., and Loudon Bank, N.A. (organizing), Loudon, Tenn., applied to the Comptroller of the Currency for permission to merge under the charter of the latter and with the title of the former. Hamilton National Bank of Loudon, the existing bank, was organized in 1922 and now has assets of $17 million and IPC deposits of $13 million. The bank operates two branch offices in Loudon County and competes directly with a branch of Bank of Loudon County which is situated in the city of Loudon. The majority of the outstanding shares of the existing bank are owned by Hamilton Bancshares, Inc. Loudon Bank, N.A., the new bank, is being organized to provide a vehicle by which to transfer ownership of the remaining shares of the existing bank to Hamilton Bancshares, Inc. The new bank will not be operating as a commercial bank prior to this merger. 118 $18,662,535 240,000 To be operated 3 0 19,029,193 3 The proposed merger will have no effect on the banking structure in Tennessee and will merely allow Hamilton Bancshares to acquire the remaining shares of the existing bank which it does not presently own. Applying the statutory criteria, it is the conclusion of this Office that the proposed merger is in the public interest and this application is, therefore, approved. DECEMBER 28, 1973. SUMMARY OF REPORT BY ATTORNEY GENERAL The proposed merger is part of a plan through which Hamilton National Bank of Loudon would become a subsidiary of Hamilton Bancshares, Inc., a bank holding company. The instant merger, however, would merely combine an existing bank with a non-operating institution; as such, and without regard to the acquisition of the surviving bank by Hamilton Bancshares, Inc., it would have no effect on competition. THE FARMERS NATIONAL BANK OF WINCHESTER, WINCHESTER, TENN., AND WINCHESTER BANK, WINCHESTER, TENN. N.A., Banking offices Total assets Name of bank and type of transaction In operation $24,413,971 240,000 The Farmers National Bank of Winchester, Winchester, Tenn. (8640), with and Winchester Bank, N.A., Winchester, Tenn. (8640), which had merged Jan. 28, 1974, under charter of the latter bank (8640) and title "Farmers National Bank." The merged bank at date of merger had COMPTROLLER'S DECISION On September 12, 1973, The Farmers National Bank of Winchester, Winchester, Tenn., and Winchester Bank, N.A. (organizing), Winchester, Tenn., applied to the Comptroller of the Currency for permission to merge under the charter of the latter and with the title "Farmers National Bank." The Farmers National Bank of Winchester, the existing bank, was organized in 1907 and now has assets of $21.3 million and IPC deposits of $16 million. The bank operates two branches and competes with a branch of The First National Bank of Franklin County which is located in Winchester. The majority of the outstanding shares of the existing bank are owned by Hamilton Bancshares, Inc. Winchester Bank, N.A., the new bank, is being organized to provide a vehicle by which to transfer ownership of the remaining shares of the existing bank to Hamilton Bancshares, Inc. The new bank will not be operating as a commercial bank prior to this merger. To be operated 3 0 25,401,014 3 The proposed merger will have no effect on the banking structure in Tennessee and will merely allow Hamilton Bancshares to acquire the remaining shares of the existing bank which it does not presently own. Applying the statutory criteria, it is the conclusion of this Office that the proposed merger is in the public interest and this application is, therefore, approved. DECEMBER 28, 1973. SUMMARY OF REPORT BY ATTORNEY GENERAL The proposed merger is part of a plan through which The Farmers National Bank of Winchester would become a subsidiary of Hamilton Bancshares, Inc., a bank holding company. The instant merger, however, would merely combine an existing bank with a non-operating institution; as such, and without regard to the acquisition of the surviving bank by Hamilton Bancshares, Inc., it would have no effect on competition. THE FIRST NATIONAL BANK IN ONANCOCK, ONANCOCK, VA., AND ONANCOCK BANK, N.A., ONANCOCK, VA. Banking offices Name of bank and type of transaction Total assets In operation The First National Bank in Onancock, Onancock, Va. (13878), with and Onancock Bank, N.A., Onancock, Va. (13878), which had merged Feb. 1, 1974, under charter of the latter bank (13878) and title "The First National Bank in Onancock." The merged bank at date of merger had COMPTROLLER'S DECISION On August 20, 1973, The First National Bank in Onancock, Onancock, Va., and Onancock Bank, N.A. (organizing), Onancock, Va., applied to the Comptroller of the Currency for permission to merge under the charter of the latter and with the title of the former. $14,718,734 240,000 14,716,635 To be operated 1 0 1 The First National Bank of Onancock, the existing bank, was organized in 1893 and, with total deposits of $12.2 million, operates as a unit bank. Its service area, Accomack County, is one of two Virginia counties located on the State's Eastern Shore, separated from the remainder of Virginia by Chesapeake Bay. It has an estimated population of 29,000. The economy of the service area is supported pri- 119 marily by the seafood industry, agriculture, lumber manufacturing, forest products, food processing plants, poultry processing plants, small textile plants, and tourism. Competition for The First National Bank in Onancock is provided by 11 offices of five commercial banks including United Virginia Bank/Seaboard National, with deposits of $215 million, which is a member of United Virginia Bancshares, Inc.; Farmers and Merchants National Bank, with deposits of $12.8 million; Metompkin Bank & Trust Company, with deposits of $7.3 million, which is a member of Fidelity American Bankshares, Inc.; and Bank of Chincoteague, Inc., with deposits of $5 million. Onancock Bank, N.A., the new bank, is being organized to provide a vehicle by which to transfer ownership of The First National Bank of Onancock to First Virginia Bankshares Corporation. The new bank will not be operating as a commercial bank prior to this merger. First Virginia Bankshares Corporation, Falls Church, Va., the bank holding company which will acquire the resulting bank, controls 21 affiliated banks with aggregate deposits of $706 million. The subsidiaries of that bank holding company operate 140 banking offices in various parts of Virginia including locations in Northern Virginia, Northern Neck, Richmond, the tidewater area, Danville, southwest Virginia, the Shenandoah Valley, and north-central Virginia. Of the 13 bank holding companies operating in the State, First Virginia Bankshares Corporation ranks sixth in deposit size. There is no competition between the holding com* pany or its subsidiaries and The First National Bank in Onancock because large distances separate their closest offices and an adequate number of alternative banking facilities operate in the intervening distances. The nearest subsidiary of First Virginia Bankshares Corporation is First Virginia Bank of Tidewater which is located 60 miles south of Onancock. That large distance effectively precludes any competition between these banks. Consummation of the proposed transaction will stimulate competition in Accomack County because the resulting subsidiary will be able to offer new and improved services by its access to the specialized service departments of the holding company, including trust and investment services, and data processing. This will be to the direct benefit of residents and businessmen who are within the service area of the resulting subsidiary. Applying the statutory criteria, it is concluded that the proposed merger is in the public interest and this application is, therefore, approved. DECEMBER 26, 1973. SUMMARY OF REPORT BY ATTORNEY GENERAL The proposed merger is part of a plan through which The First National Bank in Onancock would become a subsidiary of First Virginia Bankshares Corporation, a bank holding company. The instant merger, however, would merely combine an existing bank with a non-operating institution; as such, and without regard to the acquisition of the surviving bank by First Virginia Bankshares Corporation, it would have no effect on competition. * * THE HOMER NATIONAL BANK, HOMER, N.Y., AND HOMER BANK, N.A., HOMER, N.Y. Banking offices Name of bank and type of transaction Total assets In operation The Homer National Bank, Homer, N.Y. (3186), with and Homer Bank, N.A., Homer, N.Y. (3186), which had merged Feb. 4, 1974, under charter of the latter bank (3186) and title "The Homer National Bank." The merged bank at date of merger had COMPTROLLER'S DECISION On October 18, 1973, The Homer National Bank, Homer, N.Y., and Homer Bank, N.A., (organizing), Homer, N.Y., applied to the Comptroller of the Currency for permission to merge under the charter of the latter and with the title of the former. 120 $19,233,986 60,000 19,293,986 To be operated 2 0 2 The Homer National Bank, the merging bank, is headquartered in Homer, Cortland County, and has one branch office in Cortlandville. The bank, with total deposits of $17 million, was chartered originally in 1884. Homer Bank, N.A., the charter bank, is being organized to provide a vehicle to transfer ownership of the merging bank to First Commercial Banks, Inc. The charter bank will not be operating as a commercial bank prior to the merger. First Commercial Banks, Inc. is a multi-bank holding company headquartered in Albany, N.Y. It controls three banks: National Commercial Bank and Trust Company, Albany, with $947 million in deposits; First Trust and Deposit Company, Syracuse, with $355 million in deposits; and Kingston Trust Company, Kingston, with $68 million in deposits. With aggregate deposits of $1.4 billion, First Commercial Banks, Inc. ranks 10th in deposit structure among the 20 New York bank holding companies. Competition will not be adversely affected by the proposed merger. Competition between the merging bank and subsidiaries of First Commercial Banks, Inc. is negligible because their nearest offices are approximately 19 miles apart and are located in different banking districts. Furthermore, the proposed acquisition would not alter First Commercial Bank's rank among the State's bank holding companies. Consummation of the proposed merger would en- hance competition by removing home office protection from Homer thereby opening that community to de novo branching by other banks. Affiliation with First Commercial Banks, Inc. will enable the resulting bank to provide residents of Homer with additional services such as credit card, investment advisory, computer, and trust services. Applying the statutory criteria, it is concluded that the proposed merger is in the public interest. This application is, therefore, approved. JANUARY 4, 1974. SUMMARY OF REPORT BY ATTORNEY GENERAL The proposed merger is part of a plan through which The Homer National Bank would become a subsidiary of First Commercial Banks, Inc., a bank holding company. The instant merger, however, would merely combine an existing bank with a nonoperating institution; as such, and without regard to the acquisition of the surviving bank by First Commercial Banks, Inc., it would have no effect on competition. NATIONAL BANK AND TRUST COMPANY OF ANN ARBOR, ANN ARBOR, MICH., AND NATIONAL BANK OF ANN ARBOR, ANN ARBOR, MICH. Banking offices Total assets Name of bank and type of transaction In operation National Bank and Trust Company of Ann Arbor, Ann Arbor, Mich. (14933), with and National Bank of Ann Arbor, Ann Arbor, Mich. (14933), which had merged Feb. 28, 1974, under charter of the latter bank (14933) and title "National Bank and Trust Company of Ann Arbor." The merged bank at date of merger had COMPTROLLER S DECISION On September 26, 1973, National Bank and Trust Company of Ann Arbor, Ann Arbor, Mich., and National Bank of Ann Arbor (organizing), Ann Arbor, Mich., applied to the Comptroller of the Currency for permission to merge under the charter of the latter and with the title of the former. National Bank and Trust Company of Ann Arbor, the merging bank, is headquartered in Ann Arbor, Washtenaw County, Mich., and has nine branch offices. The bank, with total deposits of $159.7 million, was chartered originally in 1892. $165,639,365 240,000 165,879,365 To be operated 11 0 11 National Bank of Ann Arbor, the charter bank, is being organized to provide a vehicle to transfer ownership of the merging bank to National Ann Arbor Corporation, a newly created holding company. The charter bank will not be operating as a commercial bank prior to the merger. Because the merging bank is the only operating bank involved in the proposed transaction, there can be no adverse effect on competition resulting from consummation of the proposed merger. The resulting bank will conduct the same banking business at the same locations and with the same name as presently used by the merging bank. 121 Applying the statutory criteria, it is concluded that the proposed merger is in the public interest and this application is, therefore, approved. JANUARY 8, 1974. SUMMARY OF REPORT BY ATTORNEY GENERAL The proposed merger is part of a plan through which National Bank and Trust Company of Ann Arbor would become a subsidiary of National Ann Arbor Corporation, a bank holding company. The instant merger, however, would merely combine an existing bank with a non-operating institution; as such, and without regard to the acquisition of the surviving bank by National Ann Arbor Corporation, it would have no effect on competition. NATIONAL BANK OF MURFREESBORO, MURFREESBORO, TENN., AND THE SECOND NATIONAL BANK OF MURFREESBORO, MURFREESBORO, TENN. Banking offices Total assets Name of bank and type of transaction In operation National Bank of Murfreesboro, Murfreesboro, Tenn. (14736), with and The Second National Bank of Murfreesboro, Murfreesboro, Tenn. (14736), which had merged Feb. 28, 1974, under charter of the latter bank (14736) and title "The National Bank of Murfreesboro." The merged bank at date of merger had COMPTROLLER'S DECISION On October 8, 1973, National Bank of Murfreesboro, Murfreesboro, Tenn. and The Second National Bank of Murfreesboro (organizing), Murfreesboro, Tenn., applied to the Comptroller of the Currency for permission to merge under the charter of the latter and with the title "The National Bank of Murfreesboro." National Bank of Murfreesboro, the merging bank, was organized in 1955, operates two branch offices, and has received approval to open one additional branch. This bank has total assets of $19.4 million and IPC deposits of $12.5 million. The service area of the bank encompasses Rutherford County, an industrial area which has a population of approximately 59,428 people. Competitors of the merging bank include a branch of Commerce Union Bank, which has deposits of $608.1 million and is the lead subsidiary of Tennessee Valley Bancorp., Inc.; Murfreesboro Bank and Trust Company, which has deposits of $49.6 million; and First National Bank of Smyrna, which has deposits of $5.8 million. The Second National Bank of Murfreesboro, the charter bank, is being organized to provide a vehicle by which to transfer ownership of the merging bank to First Tennessee National Corporation, Memphis, Tenn. The charter bank will not be operating as a commercial bank prior to the merger. First Tennessee National Corporation, the multibank holding company that will acquire the resulting 122 $21,983,902 120,000 21,983,902 To be operated 3 0 3 bank, was organized in 1968, and is the largest bank holding company in Tennessee. It controls seven banking subsidiaries and holds aggregate deposits of $1.2 billion. The lead subsidiary, the First National Bank of Memphis, has deposits of $1 billion. The applicant has also received approval to acquire two additional banks and has applications pending to acquire two other banks. First Tennessee National Corporation experiences competition from the six other bank holding companies operating in Tennessee, including Union Planters Corporation, with deposits of $1 billion; First Amtenn Corporation, with aggregate deposits of $855.9 million; Third National Corporation, with aggregate deposits of $784.7 million; and Hamilton Bancshares, with aggregate deposits of $688.2 million. Competition between the merging bank and the subsidiaries of First Tennessee National Corporation is minimal since their closest offices are separated by a distance of approximately 25 miles and because Nashville, Tenn., is located in the intervening area. Consummation of the proposed transaction will result in no adverse competitive effects. Affiliation with First Tennessee National Corporation will allow the resulting bank to offer new and expanded services, such as trust services, international services, data processing, and money management services. Applying the statutory criteria, it is the conclusion of this Office that the proposed merger is in the public interest and will result in no adverse competitive effects. This application is, therefore, approved. JANUARY 21, 1974. SUMMARY OF REPORT BY ATTORNEY GENERAL The proposed merger is part of a plan through which National Bank of Murfreesboro would become a subsidiary of First Tennessee National Corporation, a bank holding company. The instant merger, however, would merely combine an existing bank with a non-operating institution; as such, and without regard to the acquisition of the surviving bank by First Tennessee National Corporation, it would have no effect on competition. THE FIRST NATIONAL BANK OF CANTON, CANTON, N.Y., AND CHASE MANHATTAN BANK OF NORTHERN NEW YORK (NATIONAL ASSOCIATION), CANTON, N.Y. Banking offices Total assets Name of bank and type of transaction In operation The First National Bank of Canton, Canton, N.Y. (3696), with and Chase Manhattan Bank of Northern New York (National Association), Canton, N.Y. (3696), which had merged Feb. 28, 1974, under charter and title of the latter bank (3696). The merged bank at date of merger had COMPTROLLER'S DECISION On August 20, 1973, The First National Bank of Canton, Canton, N.Y., and Chase Manhattan Bank of Northern New York (National Association) (organizing), Canton, N.Y., applied to the Comptroller of the Currency for permission to merge under the charter and title of the latter. The First National Bank of Canton, the existing bank, was organized in 1887 and has operated as a unit institution since that time with current deposits of $12.1 million. The bank ranks third in size among the eight commercial banks headquartered in St. Lawrence County. Competition for the existing bank is provided by Marine Midland Bank-Northern, Watertown, with deposits of $168 million, which is a member of Marine Midland Banks, Inc., a multi-bank holding company with aggregate deposits of $6.4 billion; and St. Lawrence National Bank, Canton, with deposits of $61 million. Chase Manhatten Bank of Northern New York (National Association), the new bank, is being organized to provide a vehicle by which to transfer ownership of The First National Bank of Canton to The Chase Manhattan Corporation. The new bank will not be operating as a commercial bank prior to this merger. The Chase Manhattan Corporation, New York, N.Y., the bank holding company which will acquire the resulting bank, was organized in December 1970 $15,711,446 1 166,860 0 To be operated 1 15,878,306 and now owns six subsidiary banks with aggregate domestic deposits of $16.9 billion. There is no competition between The Chase Manhattan Corporation or its subsidiaries and The First National Bank of Canton because very large distances separate their closest two offices and an adequate number of alternative banking facilities operate in the intervening area. The closest subsidiary of The Chase Manhattan Corporation is Chase Manhattan Bank of Central New York (National Association) which is located approximately 150 miles southwest of Canton. Consummation of the proposed merger will stimulate competition in the service area of the resulting subsidiary which will be able to offer its customers improved and expanded banking facilities including "One Statement Banking," overdraft checking, Chase Manhattan BankAm eric ard, computer services, international financing, and loan expertise in all types of financing. Applying the statutory criteria, it is concluded that the proposed merger is in the public interest and this application is, therefore, approved. JANUARY 22, 1974. SUMMARY OF REPORT BY ATTORNEY GENERAL The proposed merger is part of a plan through which The First National Bank of Canton would become a subsidiary of The Chase Manhattan Cor- 123 poration, a bank holding company. The instant merger, however, would merely combine an existing bank with a non-operating institution; as such, and without regard to the acquisition of the surviving bank by The Chase Manhattan Corporation, it would have no effect on competition. FIRST NATIONAL BANK OF LAKE CITY, LAKE CITY, MICH., AND LCM NATIONAL BANK, LAKE CITY, MICH. Banking offices Total assets Name of bank and type of transaction In operation First National Bank of Lake City, Lake City, Mich. (15234), with and LCM National Bank, Lake City, Mich. (15234), which had merged Mar. 8, 1974, under charter of the latter bank (15234) and title "First National Bank of Lake City." The merged bank at date of merger had COMPTROLLER'S DECISION On November 8, 1973, First National Bank of Lake City, Lake City, Mich., and LCM National Bank (organizing), Lake City, Mich., applied to the Comptroller of the Currency for permission to merge under the charter of the latter and with the title of the former. First National Bank of Lake City, the merging bank, was organized in 1909 and operates three branch offices. It possesses total assets of $22.4 million and IPC deposits of $18.8 million. The merging bank operates in the Lake City-Cadillac banking market and in the Roscommon banking market. Its competitors include The Cadillac State Bank, with deposits of $80.3 million; The Roscommon State Bank, with deposits of $42.5 million; and First National Bank of Cadillac, with deposits of $17 million. LCM National Bank (organizing), the charter bank, is being organized to provide a vehicle by which to transfer ownership of the merging bank to Northern State Bancorporation, Inc., a bank holding company. The charter bank will not be operating as a commercial bank prior to this merger. Northern States Bancorporation, Inc., the multibank holding company that will acquire the resulting bank, is the sixth largest banking organization in Michigan. This corporation controls City National Bank of Detroit, with deposits of $768.7 million; Bank of Lansing, with deposits of $150.5 million; and has received approval from the Federal Reserve Bank of Chicago to acquire the resulting bank. In 124 $24,664,874 60,000 To be operated 4 0 24,664,874 4 addition, it has applications pending to acquire three other banks. Northern States Bancorporation, Inc., and its subsidiaries possess total assets of $1.1 billion. Competition between the merging bank and the subsidiaries of Northern States Bancorporation, Inc., is virtually nonexistent as they operate in different sections of Michigan. Affiliation with Northern States Bancorporation, Inc., will allow the resulting bank to offer improved and expanded services such as greater lending expertise, international services, and improved managerial resources. Applying the statutory criteria, it is the opinion of this Office that the proposed transaction is in the public interest and will result in no adverse competitive effects. This application is, therefore, approved. FEBRUARY 6, 1974. SUMMARY OF REPORT BY ATTORNEY GENERAL The proposed merger is part of a plan through which First National Bank of Lake City would become a subsidiary of Northern States Bancorporation, Inc., a bank holding company. The instant merger, however, would merely combine an existing bank with a non-operating institution; as such, and without regard to the acquisition of the surviving bank by Northern States Bancorporation, Inc., it would have no effect on competition. NATIONAL BANK OF ROCHESTER, ROCHESTER, MICH., AND NBR NATIONAL BANK, ROCHESTER, MICH. Banking offices Total assets Name of bank and type of transaction In operation National Bank of Rochester, Rochester, Mich. (15274), with and NBR National Bank, Rochester, Mich. (15274), which had merged Mar. 8, 1974, under charter of the latter bank (15274) and title "National Bank of Rochester." The merged bank at date of merger had COMPTROLLER'S DECISION On October 4, 1973, National Bank of Rochester, Rochester, Mich., and NBR National Bank (organizing), Rochester, Mich., applied to the Comptroller of the Currency for permission to merge under the charter of the latter and with the title of the former. National Bank of Rochester, the merging bank, was organized in 1964, operates one branch office, and has an application pending for an additional branch. It possesses total assets of $16.6 million and IPC deposits of $12.1 million. Its major competitors include branches of National Bank of Detroit, with deposits of $5.4 billion, and Community National Bank of Pontiac, with deposits of $302.2 million. NBR National Bank, the charter bank, is being organized to provide a vehicle by which to transfer ownership of the merging bank to Northern States Corporation, Inc., and Twin Gates Corporation, registered bank holding companies. The charter bank will not be operating as a commercial bank prior to consummation of the proposed transaction. Northern States Corporation, Inc., Detroit, Mich., the first registered bank holding company which will acquire the resulting bank, has total consolidated assets of $1.1 billion. It controls two subsidiary banks, has applications pending to acquire three other banks, and also has applications pending for two de novo National bank charters. City National Bank of Detroit, with deposits of $768.7 million, is its lead subsidiary. The profit sharing trust for the employees of City National Bank of Detroit holds 13.2 percent of the outstanding capital stock of the merging bank. Competitors of Northern States Corporation, Inc., include National Bank of Detroit, with deposits of $5.4 billion; Detroit Bank and Trust, with deposits of $2.3 billion, which is a member of Detroitbank Corporation; and Manufacturers National Bank of Detroit, with deposits of $2.2 billion. Twin Gates Corporation, Wilmington, Del., the $18,604,148 120,000 To be operated 2 0 18,604,148 2 second registered bank holding company which will acquire the resulting bank, has total assets of $4.9 million. It owns 14.2 percent of the outstanding common shares of Northern States Corporation, Inc., and 20 percent of the outstanding common capital stock of the merging bank. Direct competition between the merging bank and the subsidiaries of Northern States Corporation, Inc., and Twin Gates Corporation is insignificant. Even though a branch of City National Bank of Detroit is located only 3.3 miles south of the merging bank, a minimal number of accounts are generated from each other's service area. In addition, the two banks experience a close working association and common ownership. Consummation of the proposed transaction will result in no adverse competitive effects. Rather, affiliation with the holding companies will enhance the competitive position of National Bank of Rochester by allowing it to offer new and expanded services such as a larger lending capacity through loan participations, lending expertise, management expertise, and international services. Applying the statutory criteria, it is the opinion of this Office that the proposed transaction is in the public interest and will result in no adverse competitive effects. This application is, therefore, approved. FEBRUARY 6, 1974. SUMMARY OF REPORT BY ATTORNEY GENERAL The proposed merger is part of a plan through which National Bank of Rochester would become a subsidiary of Northern States Bancorporation, a bank holding company. The instant merger, however, would merely combine an existing bank with a non-operating institution; as such, and without regard to the acquisition of the surviving bank by Northern States Bancorporation, it would have no effect on competition. 125 THE FIRST NATIONAL BANK OF CROCKETT, CROCKETT, TEX., AND THE N E W NATIONAL BANK OF CROCKETT, CROCKETT, TEX. Banking offices Name of bank and type of transaction Total assets In operation The First National Bank of Crockett, Crockett, Tex. (4684), with and The New National Bank of Crockett, Crockett, Tex. (4684), which had merged Mar. 18,1974, under charter of the latter bank (4684) and title "The First National Bank of Crockett." The merged bank at date of merger had COMPTROLLER'S DECISION On November 1, 1973, The First National Bank of Crockett, Crockett, Tex., and The New National Bank of Crockett (organizing), Crockett, Tex., applied to the Comptroller of the Currency for permission to merge under the charter of the latter and with the title of the former. The First National Bank of Crockett, the existing bank, was organized in 1892 and has operated since that time as a unit institution in compliance with Texas State law. It now has assets of $21.4 million and IPC deposits of $16 million. The service area of the bank includes the city of Crockett and the surrounding county, in a 12-mile radius. The economy of the service area consists of light manufacturing, several retail businesses, and regional shopping centers serving the 7,300 member community of Crockett, much of which is made up of retired individuals. Competition for The First National Bank of Crockett is provided by the only other bank located in Crockett, The Crockett State Bank, with deposits of $7.9 million. The New National Bank of Crockett, is being organized to provide a vehicle by which to transfer ownership of The National Bank of Crockett to Allied Bancshares, Inc. The new bank will not be operating as a commercial bank prior to this merger. Allied Bancshares, Inc., Houston, Tex., the bank holding company which will acquire the resulting bank, is presently the 11th largest bank holding company in Texas and owns three banking subsidiaries, the largest of which is Continental Bank of 126 $23,958,730 120,000 To be operated 1 0 23,776,436 1 Texas, Houston, with total deposits of $167.7 million. There is no competition between Allied Bancshares, Inc., or its subsidiaries and The First National Bank of Crockett because the closest subsidiary bank of the holding company is located in Conroe, Tex., which is 79 miles from the existing bank in Crockett. Also, an adequate number of alternative banking facilities operate in the intervening distances. Consummation of the proposed transaction will stimulate competition in Crockett because the resulting subsidiary will be able to offer the residents of that community new and more sophisticated banking services such as a full-service trust department, investment counseling, computer facilities, and international banking. Also, the resulting subsidiary will be able to handle larger loan requests because of the convenient availability of participation sources. Applying the statutory criteria, it is concluded that the proposed merger is in the public interest and this application is, therefore, approved. FEBRUARY 15, 1974. SUMMARY OF REPORT BY ATTORNEY GENERAL The proposed merger is part of a plan through which First National Bank of Crockett would become a subsidiary of Allied Bancshares, Inc., a bank holding company. The instant merger, however, would merely combine an existing bank with a nonoperating institution; as such, and without regard to the acquisition of the surviving bank by Allied Bancshares, Inc., it would have no effect on competition. THE SELMA NATIONAL BANK, SELMA, ALA., AND SELMA BANK, N.A., SELMA, ALA. Banking f Total assets Name of bank and type of transaction In operation The Selma National Bank, Selma, Ala. (7084), with and Selma Bank, N.A., Selma, Ala. (7084), which had merged Mar. 27, 1974, under charter of the latter bank (7084) and title "The Selma National Bank." The merged bank at date of merger had COMPTROLLER'S DECISION On November 16, 1973, The Selma National Bank, Selma, Ala., and Selma Bank, N.A. (organizing), Selma, Ala., applied to the Comptroller of the Currency for permission to merge under the charter of the latter and with the title of the former. The Selma National Bank, Selma, Ala., the merging bank, was organized in 1904 and operates one facility at Craig Air Force Base. It possesses total assets of $37.2 million and IPC deposits of $30 million. The service area of the bank is Dallas County, which has a population of 55,000 and is economically dependent on agriculture, industry, and business from Craig Air Force Base. Competition for the merging bank is provided in Selma by Peoples Bank and Trust Company, with deposits of $39.7 million; City National Bank of Selma, with deposits of $29.4 million; and Citizens Bank and Trust Company, with deposits of $15.8 million. Selma Bank, N.A., the charter bank, is being organized to provide a vehicle by which to transfer ownership of the merging bank to First Alabama Bancshares, Inc., Birmingham, Ala., a registered bank holding company. The charter bank will not be operating as a commercial bank prior to this merger. First Alabama Bancshares, Inc., the bank holding company that will acquire the resulting bank, was incorporated in 1971 and is the second largest banking organization in Alabama. It controls eight banks, with aggregate deposits of $741.6 million. Its largest subsidiary is the First National Bank of Montgomery, which has deposits of $280.3 million. $39,967,671 120,000 offices To be operated 1 0 1 39,971,271 Competitors of First Alabama Bancshares, Inc., include Alabama Bancorporation, with aggregate deposits of $872.7 million; Central Bancshares of the South, with aggregate deposits of $674.3 million; and Alabama Financial Group, Inc., with aggregate deposits of $600.4 million. Direct competition between the merging bank and the subsidiaries of First Alabama Bancshares, Inc., is minimal as their closest offices are separated by a distance of approximately 45 miles. Consummation of the proposed transaction will result in no adverse competitive effects. Affiliation with First Alabama Bancshares, Inc., will allow the resulting bank to offer a wider range of more sophisticated banking services such as larger commercial and industrial loans, competitive mortgage lending, and lease financing. Applying the statutory criteria, it is the opinion of this Office that the proposed transaction is in the public interest and will result in no adverse competitive effects. This application is, therefore, approved. FEBRUARY 25, 1974. SUMMARY OF REPORT BY ATTORNEY GENERAL The proposed merger is part of a plan through which The Selma National Bank would become a subsidiary of First Alabama Bancshares, Inc., a bank holding company. The instant merger, however, would merely combine an existing bank with a non-operating institution; as such, and without regard to the acquisition of the surviving bank by First Alabama Bancshares, Inc., it would have no effect on competition. 127 FIRST NATIONAL BANK OF ATHENS, ATHENS, ALA., AND FIRST BANK OF ATHENS, N.A., ATHENS, ALA. Banking offices Total assets Name of bank and type of transaction In operation First National Bank of Athens, Athens, Ala. (15073), with and First Bank of Athens, N. A., Athens, Ala. (15073), which had merged Mar. 29, 1974, under charter of the latter bank (15073) and title "First National Bank of Athens." The merged bank at date of merger had COMPTROLLER'S DECISION On December 13, 1974, First National Bank of Athens, Athens, Ala., and First Bank of Athens, N.A. (organizing), Athens, Ala., applied to the Comptroller of the Currency for permission to merge under the charter of the latter and with the title of the former. First National Bank of Athens, the existing bank, was organized in 1927 and presently operates two branches in Athens and one branch in Elkmont. It has total assets of $28.9 million and IPC deposits of $23 million. The service area of the existing bank includes all of Limestone County, in the northcentral part of Alabama adjacent to the Tennessee border, which has a population of 41,000. The economy of the service area is supported mainly by agriculture. Competition for First National Bank of Athens is provided by a branch of State National Bank of Alabama, Decatur, with deposits of $333.2 million, as well as by two banks which are located in Ardmore, Tenn., 16 miles north of Athens. Direct competition will be provided by Citizens National Bank of Limestone County, Athens, a newly organizing bank which will begin operations in the near future. First Bank of Athens, N.A., the new bank, is being organized to provide a vehicle by which to transfer ownership of First National Bank of Athens to First Alabama Bancshares, Inc. The new bank will not be operating as a commercial bank prior to this merger. First Alabama Bancshares, Inc., Birmingham, the holding company which will acquire the resulting bank, was organized in 1971 and currently is the second largest multi-bank holding company in the State with aggregate deposits of $620 million. First Alabama Bancshares controls four subsidiary banks, one located in each of the cities of Birmingham, Montgomery, Huntsville, and Dothan. In addition, First Alabama Bancshares has received approval to 128 $32,035,189 120,000 To be operated 4 0 32,031,589 4 acquire the First National Bank of Bay Minette and has submitted applications to acquire three other banks, one each in Guntersville, Selma, and Tuscaloosa. There is no competition between the holding company or its subsidiaries and First National Bank of Athens because of the distance separating their closest offices and because an adequate number of alternative banking facilities operate in the intervening area. The nearest subsidiary of the holding company is First National Bank of Huntsville, 28 miles southeast of Athens. Consummation of the proposed merger will enable the resulting bank to provide residents and businessmen in Limestone County with a wider range of more sophisticated banking services including the ability to offer commercial and industrial loans of sufficient size to encourage growth in the area, specialized trust services, data processing, lease financing, and competitive mortgage lending. The resulting subsidiary in Limestone County will also gain the availability of added management depth. As a result of this application, First Alabama Bancshares will remain the second largest bank holding company in Alabama. Applying the statutory criteria, it is concluded that the proposed merger is in the public interest and this application is, therefore, approved. FEBRUARY 27, 1974. SUMMARY OF REPORT BY ATTORNEY GENERAL The proposed merger is part of a plan through which First National Bank of Athens would become a subsidiary of First Alabama Bancshares, Inc., a bank holding company. The instant merger, however, would merely combine an existing bank with a non-operating institution; as such, and without regard to the acquisition of the surviving bank by First Alabama Bancshares, Inc., it would have no effect on competition. THE FIRST NATIONAL BANK OF HANCOCK, HANCOCK, N.Y., AND HANCOCK NATIONAL BANK, HANCOCK, N.Y. Banking offices Total assets Name of bank and type of transaction In operation The First National Bank of Hancock, Hancock, N.Y. (8613), with and Hancock National Bank, Hancock, N.Y. (8613), which had merged Mar. 29, 1974, under charter of the latter bank (8613) and title "The First National Bank of Hancock." The merged bank at date of merger had COMPTROLLER'S DECISION On September 14, 1973, The First National Bank of Hancock, Hancock, N.Y., and Hancock National Bank (organizing), Hancock, N.Y., applied to the Comptroller of the Currency for permission to merge under the charter of the latter and title of the former. The First National Bank of Hancock, the merging bank, was chartered in 1907 and operates as a unit bank. The bank has total assets of $9.8 million and IPC deposits of $7.8 million. Hancock National Bank, the charter bank, is being organized to provide a vehicle to transfer ownership of the merging bank to Charter New York Corporation. The charter bank will not be operating as a commercial bank prior to this merger. Charter New York Corporation, New York, N.Y., the holding company which will acquire the resulting bank, is the seventh largest bank holding company in New York State, with total deposits of $5.2 billion and assets of $7.8 billion in its 14 banks throughout the State. Its largest subsidiary is Irving Trust Company, New York, N.Y., with $5 billion in total assets. The applicant competes with such other bank holding companies in New York as First National City Corporation, with assets of $34.3 billion; Chase Manhattan Corporation, with assets of $28.8 billion; Manufacturers Hanover Corporation, with assets of $16.3 billion; Chemical New York Corporation, and Bankers Trust New York Corporation, each with assets of $13.4 billion. Tied in with this merger is the proposed purchase of assets and assumption of liabilities of The First National Bank of Hamden, Hamden, N.Y., by the Hancock National Bank. The Hamden bank, which has total deposits of $4.1 million and is eighth in size of the 10 Delaware County-based banks, has experienced serious capital, loan, and management problems to the extent that without additional capital and experienced management it is improbable that this bank can continue to operate. The Hamden bank will operate as a branch of the Hancock bank under $10,368,754 65,000 To be operated 1 0 1 14,164,799 the proposal which will allow the Hamden facility to continue in operation and also remove head office protection from Hamden allowing further branching competition by other banks. There is no competition between any of Charter New York Corporation's subsidiaries and The First National Bank of Hancock or The First National Bank of Hamden because the nearest subsidiary is 43 miles from Hancock with sufficient competition within the intervening distance. The proposed transaction will have a negligible effect on the statewide competitive position of Charter New York Corporation because of the relatively small size of the merging bank but it will increase competition in Delaware County where The First National Bank of Hancock and The First National Bank of Hamden are both headquartered by enabling the Hamden bank to remain in business and by removing head office protection from both Hancock and Hamden which will allow de novo branching by other banks. It will also allow these banks to offer expanded services to the people of Delaware County including larger loans, a wider variety of time and demand deposits, credit cards, complete trust services, and the expertise available through the holding company. Applying the statutory criteria, it is concluded that the proposed merger is in the public interest and this application is, therefore, approved. FEBRUARY 21, 1974. SUMMARY OF REPORT BY ATTORNEY GENERAL The proposed merger is part of a plan through which The First National Bank of Hancock would become a subsidiary of Charter New York Corporation, a bank holding company. The instant merger, however, would merely combine an existing bank with a non-operating institution; as such, and without regard to the acquisition of the surviving bank by Charter New York Corporation, it would have no effect on competition. 129 THE FIRST NATIONAL BANK OF NORDHEIM, NORDHEIM, TEX., AND THE NEW NATIONAL BANK OF NORDHEIM, NORDHEIM, TEX. Banking offices Total assets Name of bank and type of transaction In operation The First National Bank of Nordheim, Nordheim, Tex. (12390), with and The New National Bank of Nordheim, Nordheim, Tex. (12390), which had merged Apr. 1, 1974, under charter of the latter bank (12390) and title "The First National Bank of Nordheim." The merged bank at date of merger had COMPTROLLER S DECISION On October 26, 1973, The First National Bank of Nordheim, Nordheim, Tex., and The New National Bank of Nordheim (organizing), Nordheim, Tex., applied to the Comptroller of the Currency for permission to merge under the charter of the latter and with the title of the former. The First National Bank of Nordheim, the merging bank, was organized in 1910 and has total assets of $1.5 million and IPC deposits of $1.1 million. The area surrounding Nordheim and Yorktown in western DeWitt County constitutes the service area of the bank. Its competitors include First National Bank, Yorktown, with deposits of $96 million, and Yorktown Community Bank, with deposits of $4.9 million. The New National Bank of Nordheim (organizing), Nordheim, Tex., the charter bank, is being organized to provide a vehicle by which to transfer ownership of the merging bank to Victoria Bankshares, Inc., Victoria, Tex. The charter bank will not be operating as a commercial bank prior to the merger. Victoria Bankshares, Inc., the organization which will acquire the resulting bank, has applied for permission to become a bank holding company and to acquire five banks in addition to the resulting bank. Upon consummation of these transactions, it will be the 18th largest bank holding company in Texas. $1,855,142 60,000 To be operated 1 0 1 2,001,160 Since the merging bank is the only operating bank involved in the proposed transaction, there can be no adverse effect on competition resulting from consummation of the proposed merger. Nor will competition be adversely affected if the other five acquisitions proposed by Victoria Bankshares, Inc., are approved since all of the proposed subsidiaries operate in separate and distinct service areas which have a sufficient number of alternate banking choices. Affiliation with Victoria Bankshares, Inc., will allow the resulting bank to offer new services such as a trust department, oil and gas department, and investment counsel. Applying the statutory criteria, it is the opinion of this Office that the proposed transaction is in the public interest and will result in no adverse competitive effects. This application is, therefore, approved. FEBRUARY 5, 1974. SUMMARY OF REPORT BY ATTORNEY GENERAL The proposed merger is part of a plan through which The First National Bank of Nordheim would become a subsidiary of Victoria Bankshares, Inc., a bank holding company. The instant merger, however, would merely combine an existing bank with a non-operating institution; as such, and without regard to the acquisition of the surviving bank by Victoria Bankshares, Inc., it would have no effect on competition. FIRST NATIONAL BANK IN ASPEN, ASPEN, COLO., AND SECOND NATIONAL BANK IN ASPEN, ASPEN, COLO. Banking offices Name of bank and type of transaction Total assets In operation First National Bank in Aspen, Aspen, Colo. (15815), with and Second National Bank in Aspen, Aspen, Colo. (15815), which had merged Apr. 29, 1974, under charter of the latter bank (15815) and title "First National Bank in Aspen." The merged bank at date of merger had 130 $14,638,104 60,000 14,698,104 To be operated 1 0 1 COMPTROLLER S DECISION On November 1, 1973, First National Bank in Aspen, Aspen, Colo., and Second National Bank in Aspen (organizing), Aspen, Colo., applied to the Comptroller of the Currency for permission to merge under the charter of the latter and with the title of the former. First National Bank in Aspen, the merging bank, was organized in 1970 and operates as a unit institution. With total assets of $13.2 million and IPC deposits of $10 million, it is the smaller of two banks serving the Aspen Metropolitan Area. It competes directly with Bank of Aspen, with deposits of $20.3 million. Second National Bank in Aspen, the charter bank, is being organized to provide a vehicle by which to transfer ownership of the merging bank to D. H. Baldwin Company, Cincinnati, Ohio, a registered bank holding company. The charter bank will not be operating as a commercial bank prior to this merger. D. H. Baldwin Company, the holding company which will acquire the resulting bank, engages in the manufacture and sale of musical instruments as well as their electronic components, and provides financial services to dealers in its products. It now controls Central Bank and Trust Company, Denver, with deposits of $331.5 million, and the North Denver Bank, with deposits of $27 million. In addition, it controls four organizing banks including Second National Bank of Aspen, which it wishes to merge with four existing banks. Competition between the operating subsidiaries of D. H. Baldwin Company and the merging bank is virtually nonexistent since they are separated by a distance of more than 150 road miles. Affiliation of the resulting bank with D. H. Baldwin Company will enhance the competitive situation in Aspen since the resulting bank will be provided with increased capital, improved lending expertise, and trust services. Applying the statutory criteria, it is the opinion of this Office that the proposed transaction is in the public interest and will result in no adverse competitive effects. This application is, therefore, approved. MARCH 28, 1974. SUMMARY OF REPORT BY ATTORNEY GENERAL [This merger is a part] * * * of plans through which the existing banks will become subsidiaries of D. H. Baldwin Company. [It] * * *, however, will merely combine an existing bank with a non-operating institution and without regard to the acquisition of the surviving banks by D. H. Baldwin Company, will have no effect on competition. THE FIRST NATIONAL BANK OF GLENWOOD SPRINGS, GLENWOOD SPRINGS, COLO., AND SECOND NATIONAL BANK IN GLENWOOD SPRINGS, GLENWOOD SPRINGS, COLO. Banking offices Name of bank and type of transaction Total assets The First National Bank of Glenwood Springs, Glenwood Springs, Colo. (3661), with and Second National Bank in Glenwood Springs, Glenwood Springs, Colo. (3661), which had . merged Apr. 29, 1974, under charter of the latter bank (3661) and title "First National Bank of Glenwood Springs." The merged bank at date of merger had COMPTROLLER'S DECISION On November 1, 1973, First National Bank of Glenwood Springs, Glenwood Springs, Colo., and Second National Bank in Glenwood Springs (organizing), Glenwood Springs, Colo., applied to the Comptroller of the Currency for permission to merge under the charter of the latter and title of the former. The First National Bank of Glenwood Springs, the merging bank, was organized in 1887 and operates as a unit institution. It possesses total assets of $36.5 $40,455,126 60,000 40,515,126 In To be operation operated 1 0 1 million and IPC deposits of $29.2 million. The service area of the bank encompasses the southeastern section of Barfield County and an adjoining portion of western Pitkin County. Competition in that area is afforded by Bank of Glenwood, which has deposits of $11.7 million and is a subsidiary of Colorado National Bankshares, Inc.; First National Bank in Rifle, which has deposits of $9.3 million; and Roaring Fork Bank, which was opened in 1973. Second National Bank in Glenwood Springs, the charter bank, is being organized to provide a vehicle 131 to transfer ownership of the merging bank to D. H. Baldwin Company, Cincinnati, Ohio. The charter bank will not be operating as a commercial bank prior to this merger. D. H. Baldwin Company, Cincinnati, Ohio, the holding company which will acquire the resulting bank, operates primarily in Colorado and deals in banking, savings and loan, insurance, and other financial services. Its wholly-owned subsidiary, Baldwin-Central, Inc., is a one-bank holding company which controls Central Bank and Trust Company, Denver, Colo., which has deposits of $331.5 million. The acquiring bank holding company has made application to acquire several other Colorado banks. No competition exists between those banks and Central Bank and Trust Company, the present subsidiary, since their closest offices are separated by a distance of approximately 169 miles. Because the merging bank and the other banks to be acquired by D. H. Baldwin Company are substantially owned by the McKinley family and because policies of the banks are dominated by their president, George B. McKinley, no adverse competitive effects will result from consummation of this and the other pending actions. The economies of the areas under consideration are expected to expand rapidly in the near future through increased tourism and skiing activity, development of an oil shale industry, renewed activity in uranium and coal mining, and oil and gas exploration and development. Consummation of the proposed transaction will afford the resulting bank the increased capital, lending expertise, and trust services which the areas will soon require, thus enhancing competition. D. H. Baldwin Company will become the fourth largest bank holding company in Colorado upon consummation of this and the other pending transactions. Applying the statutory criteria, it is the conclusion of this Office that the proposed merger is in the public interest and this application is, therefore, approved. MARCH 28, 1974. SUMMARY OF REPORT BY ATTORNEY GENERAL [This merger is a part] * * * of plans through which the existing banks will become subsidiaries of D. H. Baldwin Company. [It] * * *, however, will merely combine an existing bank with a non-operating institution and without regard to the acquisition of the surviving banks by D. H. Baldwin Company, will have no effect on competition. FIRST NATIONAL BANK IN GRAND JUNCTION, GRAND JUNCTION, COLO., AND SECOND NATIONAL BANK IN GRAND JUNCTION, GRAND JUNCTION, COLO. Banking offices Name of bank and type of transaction Total assets In operation First National Bank in Grand Junction, Grand Junction, Colo. (13902), with and Second National Bank in Grand Junction, Grand Junction, Colo. (13902), which had merged Apr. 29, 1974, under charter of the latter bank (13902) and title "First National Bank in Grand Junction." The merged bank at date of merger had COMPTROLLER'S DECISION On November 1, 1973, First National Bank in Grand Junction, Grand Junction, Colo., and Second National Bank in Grand Junction (organizing), Grand Junction, Colo., applied to the Comptroller of the Currency for permission to merge under the charter of the latter and title of the former. First National Bank in Grand Junction, Grand Junction, Colo., the merging bank, was organized in 1933 and operates as a unit institution. With total assets of $46.1 million and IPC deposits of $37 million, it is the largest of the four banks located in Grand Junction. Its service area encompasses Mesa 132 $51,045,708 120,000 51,165,708 To be operated 1 0 1 County wherein it competes with United States Bank of Grand Junction, with deposits of $38.2 million; Mesa United Bank of Grand Junction, N.A., with deposits of $13.6 million; First National Bank-North in Grand Junction, with deposits of $1 million; Fuita State Bank, with deposits of $6.4 million; and Palisades National Bank, with deposits of $3.8 million. Second National Bank in Grand Junction, the charter bank, is being organized to provide a vehicle to transfer ownership of the merging bank to D. H. Baldwin Company, Cincinnati, Ohio. The charter bank will not be operating as a commercial bank prior to this merger. D. H. Baldwin Company, Cincinnati, Ohio, the holding company which will acquire the resulting bank, operates primarily in Colorado and deals in banking, savings and loan, insurance, and other financial services. Its wholly-owned subsidiary, Baldwin-Central, Inc., is a one-bank holding company which controls Central Bank and Trust Company, Denver, Colo., with deposits of $331.5 million. The acquiring bank holding company has made application to acquire several other Colorado banks. No competition occurs between those banks and Central Bank and Trust Company, the present subsidiary, as their closest offices are separated by a distance of approximately 169 miles. Because First National Bank in Grand Junction and the other banks to be acquired by D. H. Baldwin Company, including First National Bank - North in Grand Junction, are substantially owned by the McKinley family and because policies of the banks are dominated by their president, George B. McKinley, no adverse competitive effects will result from consummation of this and the other pending transactions even though First National Bank in Grand Junction and First National Bank - North in Grand Junction are separated by only 2.2 miles. The economies of the areas under consideration are expected to expand rapidly in the near future through in- creased tourism and skiing activity, development of an oil shale industry, renewed activity in uranium and coal mining, and oil and gas exploration and development. Consummation of the proposed transaction will afford the resulting bank the increased capital, lending expertise, and trust services which the areas will soon require, thus enhancing competition. D. H. Baldwin Company will become the fourth largest bank holding company in Colorado upon consummation of this and the other pending transactions. Applying the statutory criteria, it is the conclusion of this Office that the proposed merger is in the public interest and this application is, therefore, approved. MARCH 28, 1974. SUMMARY OF REPORT BY ATTORNEY GENERAL [This merger is a part] * * * of plans through which the existing banks will become subsidiaries of D. H. Baldwin Company. [It] * * *, however, will merely combine an existing bank with a non-operating institution and without regard to the acquisition of the surviving banks by D. H. Baldwin Company, will have no effect on competition. FIRST NATIONAL BANK - NORTH IN GRAND JUNCTION, GRAND JUNCTION, COLO., AND SECOND NATIONAL BANK - NORTH, GRAND JUNCTION, GRAND JUNCTION, COLO. Banking offices Total assets Name of bank and type of transaction In operation First National Bank - North in Grand Junction, Grand Junction, Colo. (16054), with and Second National Bank - North, Grand Junction, Grand Junction, Colo. (16054), which h a d . . . merged Apr. 29, 1974, under charter of the latter bank (16054) and title "First National Bank North in Grand Junction." The merged bank at date of merger had COMPTROLLER'S DECISION On November 1, 1973, First National Bank - North in Grand Junction, Grand Junction, Colo., and Second National Bank - North, Grand Junction (organizing), Grand Junction, Colo., applied to the Comptroller of the Currency for permission to merge under the charter of the latter and with the title of the former. First National Bank - North in Grand Junction, the merging bank, was organized in 1972 and now has total assets of $2.5 million and IPC deposits of $1.5 million. The merging bank presently operates two walk-up windows and three drive-in units and its $3,966,041 120,000 4,086,041 To be operated 1 0 1 service area consists of a portion of eastern Grand Junction and environs. The bank is the smallest of the four banks located in Grand Junction and competes with United States Bank in Grand Junction, with deposits of $38.2 million, and Mesa United Bank of Grand Junction, with deposits of $13.6 million. Second National Bank - North, Grand Junction, the charter bank, is being organized to provide a vehicle by which to transfer ownership of the merging bank to D. H. Baldwin Company, Cincinnati, Ohio, a registered bank holding company. The charter bank will not be operating as a commercial bank prior to this merger. 133 D. H. Baldwin Company, the holding company which will acquire the resulting bank, engages in the manufacture and sale of musical instruments as well as their electronic components and provides financial services to dealers in its products. It now controls Central Bank and Trust Company, Denver, with deposits of $331.5 million, and The North Denver Bank, with deposits of $27 million. In addition, it controls four organizing banks, including Second National Bank - North, Grand Junction, which it wishes to merge with four existing banks. Competition between the operating subsidiaries of D. H. Baldwin Company and the merging bank is virtually nonexistent since they are separated by a distance of more than 200 road miles. Affiliation of the resulting bank with D. H. Baldwin Company will enhance the competitive situation in Grand Junction as the resulting bank will be provided with increased capital, improved lending expertise, and trust services. Applying the statutory criteria, it is the opinion of this Office that the proposed transaction is in the public interest and will result in no adverse competitive effects. This application is, therefore, approved. MARCH 28, 1974. SUMMARY OF REPORT BY ATTORNEY GENERAL [This merger is a part] * * * of plans through which the existing banks will become subsidiaries of D. H. Baldwin Company. [It] * * *, however, will merely combine an existing bank with a non-operating institution and without regard to the acquisition of the surviving banks by D. H. Baldwin Company, will have no effect on competition. CONCORD NATIONAL BANK, CONCORD, N.H., AND THE CONCORD BANK, NATIONAL ASSOCIATION, CONCORD, N.H. Banking offices Name of bank and type of transaction Total assets In operation Concord National Bank, Concord, N.H. (318), with and The Concord Bank, National Association, Concord, N.H. (318), which had merged Apr. 30, 1974, under charter of the latter bank (318) and title "Concord National Bank." The merged bank at date of merger had COMPTROLLER'S DECISION On October 31, 1973, Concord National Bank, Concord, N.H., and The Concord Bank, National Association (organizing), Concord, N.H., applied to the Comptroller of the Currency for permission to merge under the charter of the latter and with the title of the former. Concord National Bank, the merging bank, was organized in 1864 and now operates two branch offices. With total assets of $46.3 million and IPC deposits of $31.5 million, it ranks as sixth largest among the commercial banks in New Hampshire. The service area of the bank includes Concord and the towns contiguous to it. Competitors for the merging bank include branches of Bank of New Hampshire, National Association, with deposits of $121 million; The New Hampshire Savings Bank, with deposits of $115 million; Concord Savings Bank, with deposits of $50.6 million; and Merrimack County Savings Bank, with deposits of $36 million. The Concord Bank, National Association, the charter bank, is being organized to provide a vehicle 134 To be operated $49,518,116 120,000 49,638,116 by which to transfer ownership of the merging bank to First Bancorporation of New Hampshire, Inc., Exeter, N.H. The charter bank will not be operating as a commercial bank prior to the merger. First Bancorp of N.H., Inc., the registered bank holding company which will acquire the resulting bank, was incorporated in 1971. It possesses total assets of $37.6 million and controls one banking subsidiary, Exeter Banking Company, with deposits of $31.6 million. Competitors for that subsidiary include Indian Head National Bank of Exeter, which has deposits of $34 million and is a member of Indian Head Banks, Inc., and Hampton National Bank, which has deposits of $13 million. Consummation of the proposed transaction will result in no adverse competitive effects. Competition between the merging bank and Exeter Banking Company is minimal because their closest offices are separated by a distance of 28 miles and because they serve distinct areas. Rather, competition will be increased because affiliation with First Bancorp of N.H., Inc., will allow the resulting bank to offer improved and expanded services such as easier access to loan participation, leasing, real estate financing, and revolving accounts receivable financing. The resulting bank will utilize the same name and offices as presently used by the merging bank. Applying the statutory criteria, it is the opinion of this Office that the proposed transaction is in the public interest and will result in no adverse competitive effects. This application is, therefore, approved. MARCH 12, 1974. SUMMARY OF REPORT BY ATTORNEY GENERAL [This merger is a part] * * * of plans through which the existing banks will become subsidiaries of First Bancorp of N.H., Inc. [It] * * *, however, will merely combine an existing bank with a non-operating institution and without regard to the acquisition of the surviving banks by First Bancorp of N.H., Inc., will have no effect on competition. LACONIA PEOPLES NATIONAL BANK & TRUST COMPANY, LACONIA, N.H., NATIONAL ASSOCIATION, LACONIA, AND THE LACONIA BANK, N.H. Banking offices Total assets Name of bank and type of transaction In operation Laconia Peoples National Bank & Trust Company, Laconia, N.H. (4037), with and The Laconia Bank, National Association, Laconia, N.H. (4037), which had merged Apr. 30, 1974, under charter of the latter bank (4037) and title "Laconia Peoples National Bank and Trust Company." The merged bank at date of merger had COMPTROLLER'S DECISION On October 28, 1973, Laconia Peoples National Bank & Trust Company, Laconia, N.H., and The Laconia Bank, National Association (organizing), Laconia, N.H., applied to the Comptroller of the Currency for permission to merge under the charter of the latter and with the title "Laconia Peoples National Bank and Trust Company." Laconia Peoples National Bank & Trust Company, Laconia, N.H., the merging bank, was organized in 1969, now operates one drive-up branch and one walk-up branch during the summer months. With total assets of $26 million and IPC deposits of $19.3 million, it is the largest commercial bank in Belknap County. Because the service area of the bank encompasses Laconia and the towns contiguous to it, a summer resort area, it experiences its strongest competition from Laconia Savings Bank, with deposits of $44.5 million, and Meredith Village Savings Bank, with deposits of $23.7 million. The Laconia Bank, National Association, the charter bank, is being organized to provide a vehicle by which to transfer ownership of the merging bank to First Bancorp of New Hampshire, Inc., Exeter, N.H., a bank holding company. The charter bank will not be operating as a commercial bank prior to consummation of the proposed transaction. $27,687,575 120,000 27,691,175 To be operated 4 0 4 First Bancorp of New Hampshire, Inc., the bank holding company that will acquire the resulting bank, was organized in 1971. It controls one subsidiary bank, Exeter Banking Company, which has deposits of $31 million. This bank derives its major competition from Indian Head National Bank of Exeter, which has deposits of $33.5 million and is a member of Indian Head Banks, Inc., and from the banks located in the nearby city of Portsmouth. Competition between the merging bank and the existing subsidiary of First Bancorp of New Hampshire, Inc., is virtually nonexistent since they are separated by a distance of 60 miles. In addition, the president and a director of the holding company is also a director of the merging bank. Consummation of the proposed transaction will result in no adverse competitive effects. Affiliation with First Bancorp of New Hampshire, Inc., will enable the resulting bank to offer improved and expanded services including a larger loan capacity through loan participations and data processing services. Applying the statutory criteria, it is the opinion of this Office that the proposed transaction is in the public interest and will result in no adverse competitive effects. This application is, therefore, approved. MARCH 12, 1974. 135 SUMMARY OF REPORT BY ATTORNEY GENERAL [This merger is a part] * * * of plans through which the existing banks will become subsidiaries of First Bancorp of N.H., Inc. [It] * * *, however, will merely combine an existing bank with a non-operating institution and without regard to the acquisition of the surviving banks by First Bancorp of N.H., Inc., will have no effect on competition. THE CITY NATIONAL BANK OF SELMA, SELMA, ALA., AND DALLAS COUNTY NATIONAL BANK, SELMA, ALA. Banking offices Name of bank and type of transaction Total assets In operation The City National Bank of Selma, Selma, Ala. (1736), with and Dallas County National Bank, Selma, Ala. (1736), which had merged Apr. 30, 1974, under charter of the latter bank (1736) and title "The City National Bank of Selma." The merged bank at date of merger had COMPTROLLER'S DECISION On October 23, 1973, The City National Bank of Selma, Selma, Ala., and Dallas County National Bank (organizing), Selma, Ala., applied to the Comptroller of the Currency for permission to merge under the charter of the latter and with the title of the former. The City National Bank of Selma, the existing bank, was organized in 1870 and presently operates a single office with assets of $33.3 million and IPC deposits of $24.2 million from which it serves the city of Selma and the area within a 10-mile radius of the bank. The existing bank has been granted approval to open a branch office in northwest Selma. Competition for the existing bank is provided by The Peoples Bank and Trust Company, Selma, with deposits of $41.5 million; The Selma National Bank, with deposits of $31 million; Citizens Bank and Trust Company, Selma, with deposits of $16.7 million; and The Peoples Bank at Selma Mall, National Association, with deposits of $1.3 million. Dallas County National Bank, the new bank, is being organized to provide a vehicle by which to transfer ownership of The City National Bank of Selma to Alabama Bancorporation, Birmingham, the largest bank holding company in the State. The new bank will not be operating as a commercial bank prior to this merger. Alabama Bancorporation, the bank holding company which will acquire the resulting bank was organized in 1970 and presently controls seven banks throughout the State with aggregate deposits of $1.1 billion. The largest of those subsidiary banks is The First National Bank of Birmingham, with 136 $38,037,630 120,000 38,157,630 To be operated 2 0 2 deposits of $806 million. The remaining subsidiaries are located in Decatur, Mobile, Sulligent, Anniston, Montgomery, and Huntsville. In addition, Alabama Bancorporation has approval to acquire J. C. Jacobs Banking Company, Inc., Scottsboro, with deposits of $17.7 million; Baldwin National Bank, Robertsdale, with deposits of $8.7 million; and Fort Payne Bank, Fort Payne, with deposits of $14.3 million. The bank holding company also controls six nonbanking subsidiaries which specialize in mortgage servicing and financial data operations. There is no competition between Alabama Bancorporation or its subsidiaries and The City National Bank of Selma because of the distance that separates their closest two offices and the adequate number of alternative banking facilities which operate in the intervening area. The closest office of a subsidiary bank of Alabama Bancorporation to The City National Bank of Selma is 50 miles away in Montgomery. Consummation of the proposed merger will stimulate competition in Dallas County because the resulting subsidiary in Selma will be able to offer new and improved services such as FHA and VA long-term mortgage loans, a wider range of trust services, an investment bond department, and international banking. In addition, consummation of the proposal will enable the resulting bank to serve larger credit lines and to provide increased services for local representatives of National accounts. Furthermore, the acquisition of the resulting bank by Alabama Bancorporation will not significantly change its size in relation to that of the other multi-bank holding companies in Alabama. Applying the statutory criteria, it is concluded that the proposed merger is in the public interest and this application is, therefore, approved. MARCH 27, 1974. SUMMARY OF REPORT BY ATTORNEY GENERAL The proposed merger is part of a plan through which The City National Bank of Selma would become a subsidiary of Alabama Bancorporation, a bank holding company. The instant merger, however, would merely combine an existing bank with a non-operating institution; as such, and without regard to the acquisition of the surviving bank by Alabama Bancorporation, it would have no effect on competition. THE MERCHANTS NATIONAL BANK OF MANCHESTER, MANCHESTER, N.H., NATIONAL ASSOCIATION, MANCHESTER, AND THE MERCHANTS BANK, N.H. Banking offices Name of bank and type of transaction Total assets In operation The Merchants National Bank of Manchester, Manchester, N.H. (1520), with and The Merchants Bank, National Association, Manchester, N.H. (1520), which had merged Apr. 30, 1974, under charter of the latter bank (1520) and title "The Merchants National Bank of Manchester." The merged bank at date of merger had COMPTROLLER'S DECISION On October 31, 1973, The Merchants Bank, National Association (organizing), Manchester, N.H., applied to the Comptroller of the Currency for permission to merge with The Merchants National Bank of Manchester, Manchester, N.H., under the charter of the former and with the title of the latter. The Merchants National Bank, the merging bank, was organized in 1853 and now holds total deposits of approximately $37.5 million. The bank is headquartered in Manchester, Hillsboro County, N.H., and maintains three branch offices. Its primary service area consists of the city of Manchester and contiguous towns. Manchester, the largest city in New Hampshire, has an approximate population of 87,754. The merging bank, ranking third of six commercial banks located in Manchester, competes primarily with The Manchester Bank, with $135.3 million in deposits, and Bank of New Hampshire, with $120.8 million in deposits. Those banks are, respectively, the second and third largest banks in New Hampshire. Other competitors include Amoskeag National Bank and Trust Company, with total deposits of $36.6 million; Amoskeag Savings Bank, with total deposits of $250 million; and The Merchants Savings Bank of Manchester, with total deposits of $143.2 million. The Merchants Bank, National Association, Manchester, N.H., the charter bank, is being organized to provide a vehicle by which to transfer ownership of the merging bank to First Bancorp of New Hampshire, Inc. The charter bank will not be operating as $48,482,913 240,000 To be operated 4 0 4 48,722,913 a commercial bank prior to the proposed merger. First Bancorp of New Hampshire, Inc., the holding company which will acquire the resulting bank, is headquartered in Exeter, Rockingham County, N.H. The holding company's only subsidiary is The Exeter Banking Company, a trust company with total deposits of approximately $30.9 million. As there is no overlap in the service area of the present subsidiary of First Bancorp of New Hampshire, Inc. and The Merchants National Bank, the proposed acquisition will not adversely affect competition. The closest office of the Exeter Banking Company is in Raymond, 18 miles from the nearest branch of The Merchants National Bank. The proposed transaction will enable the resulting bank to offer more complete and sophisticated services enhancing its ability to compete with its larger competitors. Applying the statutory criteria, it is concluded that the proposed merger is in the public interest. The application is, therefore, approved. MARCH 12, 1974. SUMMARY OF REPORT BY ATTORNEY GENERAL [This merger is a part] * * * of plans through which the existing banks will become subsidiaries of First Bancorp of N.H., Inc. [It] * * *, however, will merely combine an existing bank with a non-operating institution and without regard to the acquisition of the surviving banks by First Bancorp of N.H., Inc., will have no effect on competition. 137 THE FIRST NATIONAL BANK OF SAULT STE. MARIE, SAULT STE. MARIE, MICH., AND SAULT NATIONAL BANK, SAULT STE. MARIE, MICH. Banking offices Total assets Name of bank and type of transaction In operation The First National Bank of Sault Ste. Marie, Sault Ste. Marie, Mich. (3547), with and Sault National Bank, Sault Ste. Marie, Mich. (3547), which had merged May 8, 1974, under charter of the latter bank (3547) and title "The First National Bank of Sault Ste. Marie." The merged bank at date of merger had COMPTROLLER'S DECISION On October 12, 1973, Sault National Bank (organizing), Sault Ste. Marie, Mich., and The First National Bank of Sault Ste. Marie, Sault Ste. Marie, Mich., applied to the Comptroller of the Currency for permission to merge under the charter of the former and with the title of the latter. The First National Bank of Sault Ste. Marie, the existing bank, was organized in 1886 and presently operates two branches with total assets of $25.9 million and IPC deposits of $18.9 million. The existing bank serves Sault Ste. Marie and the northeastern corner of the upper peninsula of Michigan. Competition for The First National Bank of Sault Ste. Marie is provided by Sault Savings Bank, Sault Ste. Marie, which has deposits of $33 million; The First National Bank of St. Ignace, which has deposits of $17.1 million; Central Savings Bank, Sault Ste. Marie, which has deposits of $18 million; and The Citizens State Bank of Rudyard, which has deposits of $5.2 million. Sault National Bank is being organized to provide a vehicle by which to transfer ownership of The First National Bank of Sault Ste. Marie to First National Financial Corporation, Kalamazoo, Mich. The new bank will not be operating as a commercial bank prior to this merger. First National Financial Corporation, the holding company which will acquire the resulting bank, is currently the 11th largest multi-bank holding company in Michigan. The holding company controls eight banks with aggregate deposits of $420.2 million. Its lead bank is The First National Bank and Trust Company of Michigan, Kalamazoo, which has deposits of $375 million. First National Financial 138 $24,723,196 120,000 To be operated 2 0 24,954,611 2 Corporation also controls Great Lakes Computer Service which furnishes automated services to the subsidiary banks. There is no competition between First National Financial Corporation or its subsidiaries and The First National Bank of Sault Ste. Marie because large distances separate their closest two offices and an adequate number of alternative banking facilities operate in the intervening area. The closest existing subsidiary of First National Financial Corporation is located 45 miles to the south in Mackinaw City. Consummation of the proposed merger will stimulate competition in the upper peninsula of Michigan because the resulting subsidiary in Sault Ste. Marie will be able to ofifer new and improved services such as an in-plant payroll deduction plan, a Master Charge credit card program, a trust department, a Christmas Club, and agricultural services. In addition, the holding company will furnish an experienced commercial loan officer for the resulting bank. Applying the statutory criteria, it is concluded that the proposed merger is in the public interest and this application is, therefore, approved. APRIL 8, 1974. SUMMARY OF REPORT BY ATTORNEY GENERAL The proposed merger is part of a plan through which The First National Bank of Sault Ste. Marie would become a subsidiary of First National Financial Corporation, a bank holding company. The instant merger, however, would merely combine an existing bank with a non-operating institution; as such, and without regard to the acquisition of the surviving bank by First National Financial Corporation, it would have no effect on competition. OLD & THIRD NATIONAL BANK OF UNION CITY, UNION CITY, TENN., AND THE NATIONAL BANK OF UNION CITY, UNION CITY, TENN. Banking offices Total assets Name of bank and type of transaction In operation Old & Third National Bank of Union City, Union City, Tenn. (9629), with and The National Bank of Union City, Union City, Tenn. (9629), which had merged May 9, 1974, under charter of the latter bank (9629) and title "Old & Third National Bank of Union City." The merged bank at date of merger had COMPTROLLER'S DECISION On December 27, 1973, The National Bank of Union City (organizing), Union City, Tenn., and Old & Third National Bank of Union City, Union City, Tenn., applied to the Comptroller of the Currency for permission to merge under the charter of the former and with the title of the latter. Old & Third National Bank of Union City, the existing bank, was organized in 1910, and presently operates two branches with total assets of $40.1 million and IPC deposits of $27.5 million. The service area of the existing bank consists of Obion County, Tenn., which has a population of 29,936. The economy of the service area is based on agriculture and manufacturing. Competition for Old & Third National Bank of Union City is provided by Farmers Exchange Bank, Union City, which has deposits of $22 million and is a member of First Amtenn Corporation, Nashville; First State Bank, Kenton, which has deposits of $6.6 million; The Commercial Bank, Obion, which has deposits of $6.0 million; Bank of Troy, which has deposits of $5.2 million; Reelfoot Bank, Union City, which has deposits of $4.9 million; Bank of Elbridge, which has deposits of $4.1 million; and Farmers Bank, Woodland Mills, which has deposits of $3.2 million. The National Bank of Union City, is being organized to provide a vehicle by which to transfer ownership of Old & Third National Bank of Union City to Tennessee Valley Bancorporation, Inc. The new bank will not be operating as a commercial bank prior to this merger. Tennessee Valley Bancorporation, Inc., Nashville, Tenn., the bank holding company which will acquire the resulting bank, is the fourth largest multi-bank holding company in the State and presently controls two banks, Commerce Union Bank, Nashville, which has deposits of $705 million, and $42,758,868 120,000 To be operated 3 0 3 42,762,468 Citizens Bank, Elizabethton, which has deposits of $23.3 million. There is no competition between the subsidiaries of Tennessee Valley Bancorporation, Inc., and Old & Third National Bank of Union City because a large distance separates their closest two offices and an adequate number of alternative banking facilities operate in the intervening area. The nearest subsidiary of the holding company is the branch of Commerce Union Bank in Camden, 63 miles southeast of Union City. Consummation of the proposed merger will stimulate competition in Obion County because the resulting subsidiary in Union City will be able to offer new and improved services such as equipment leasing, mortgage banking, international banking, investment management, corporate trust services, commercial data processing, and 24-hour electronic tellers. In addition, the resulting bank will have access to the extensive management training and recruitment program of Tennessee Valley Bancorporation, Inc. Consummation of the proposed merger will not significantly affect the size of Tennessee Valley Bancorporation, Inc., in relation to that of the other multi-bank holding companies in the State. Applying the statutory criteria, it is concluded that the proposed merger is in the public interest and this application is, therefore, approved. APRIL 9, 1974. SUMMARY OF REPORT BY ATTORNEY GENERAL The proposed merger is part of a plan through which Old & Third National Bank of Union City would become a subsidiary of Tennessee Valley Bancorp, Inc., a bank holding company. The instant merger, however, would merely combine an existing bank with a non-operating institution; as such, and without regard to the acquisition of the surviving bank by Tennessee Valley Bancorp, Inc., it would have no effect on competition. 139 REPUBLIC NATIONAL BANK OF DALLAS, DALLAS, TEX., AND ERVAY BANK, NATIONAL ASSOCIATION, DALLAS, TEX. Banking offices Name of bank and type of transaction Total assets In operation Republic National Bank of Dallas, Dallas, Tex. (12186), with and Ervay Bank, National Association, Dallas, Tex. (12186), which had merged May 9, 1974, under charter of the latter bank (12186) and title "Republic National Bank of Dallas." The merged bank at date of merger had COMPTROLLER'S DECISION On February 25, 1974, Ervay Bank, National Association (organizing), Dallas, Tex., and Republic National Bank of Dallas, Dallas, Tex., applied to the Comptroller of the Currency for permission to merge under the charter of the former and with the title of the latter. Republic National Bank of Dallas, the existing bank, was organized in 1920 and presently operates as a unit bank with total assets of $2.4 billion and IPC deposits of $1.3 billion. The existing bank is currently the largest bank in Texas. Ervay Bank, the new bank, is being organized to provide a vehicle by which to transfer ownership of the existing bank to Republic of Texas Corporation, Dallas, Tex., which will become a one-bank holding company upon its acquisition of the resulting bank. Ervay Bank, National Association, will not be operating as a commercial bank prior to this merger. Because Republic National Bank of Dallas is the only operating bank involved in the proposed trans- $2,862,368,727 248,444 To be operated 1 0 2,862,376,077 1 action, there can be no adverse effect on competition resulting from consummation of the proposed merger. The resulting bank will conduct the same business, at the same location and with the same name as presently used by Republic National Bank of Dallas. Applying the statutory criteria, it is concluded that the proposed merger is in the public interest and this application is, therefore, approved. APRIL 8, 1974. SUMMARY OF REPORT BY ATTORNEY GENERAL The proposed merger is part of a plan through which Republic National Bank of Dallas would become a subsidiary of Republic of Texas Corporation, a bank holding company. The instant merger, however, would merely combine an existing bank with a non-operating institution; as such, and without regard to the acquisition of the surviving bank by Republic of Texas Corporation, it would have no effect on competition. THE FIRST NATIONAL BANK OF N E W BEDFORD, N E W BEDFORD, MASS., AND SECOND NATIONAL BANK OF N E W BEDFORD, N E W BEDFORD, MASS. Banking offices Total assets Name of bank and type of transaction In operation The First National Bank of New Bedford, New Bedford, Mass. (261), with and Second National Bank of New Bedford, New Bedford, Mass. (261), which had merged May 10, 1974, under charter of the latter bank (261) and title "The First National Bank of New Bedford." The merged bank at date of merger had COMPTROLLER S DECISION On January 2, 1974, The First National Bank of New Bedford, New Bedford, Mass., and Second National Bank of New Bedford (organizing), New Bedford, Mass., applied to the Comptroller of the 140 $75,629,994 240,000 75,637,193 To be operated 6 0 6 Currency for permission to merge under the charter of the latter and with the title of the former. The First National Bank of New Bedford, the existing bank, was organized in 1832 and presently operates five branches with total assets of $73.4 million and IPC deposits of $51.4 million. The pri- mary service area of the existing bank encompasses the towns of New Bedford and Dartmouth along with their immediately surrounding areas in southeastern Bristol County. Direct competition for the existing bank is provided by New Bedford Institute for Savings, New Bedford, with deposits of $220 million; New Bedford Five Cents Savings Bank, New Bedford, with deposits of $151 million; Fairhaven Savings Bank, Fairhaven, with deposits of $93 million; B.M.C. Durfee Trust Company, Fall River, with deposits of $63 million; The Merchants National Bank of New Bedford, with deposits of $51.7 million; and Southeastern Bank and Trust Company, New Bedford, with deposits of $42.2 million. Second National Bank of New Bedford is being organized to provide a vehicle by which to transfer ownership of The First National Bank of New Bedford to First Melville Bancorp, Inc., New Bedford, Mass., which will become a one-bank holding company upon its acquisition of the resulting bank. Second National Bank of New Bedford will not be operating as a commercial bank prior to this merger. Because The First National Bank of New Bedford is the only operating bank involved in the proposed transaction, there can be no adverse effect on competition resulting from consummation of the proposed merger. The resulting bank will conduct the same banking business at the same locations and with the same name as presently used by the existing bank. Applying the statutory criteria, it is concluded that the proposed merger is in the public interest and this application is, therefore, approved. APRIL 8, 1974. SUMMARY OF REPORT BY ATTORNEY GENERAL The proposed merger is part of a plan through which The First National Bank of New Bedford would become a subsidiary of First Melville Bancorp, Inc., a bank holding company. The instant merger, however, would merely combine an existing bank with a non-operating institution; as such, and without regard to the acquisition of the surviving bank by First Melville Bancorp, Inc., it would have no effect on competition. THE UNION NATIONAL BANK AND TRUST COMPANY OF MARQUETTE, MARQUETTE, MICH., AND UNB NATIONAL BANK, MARQUETTE, MICH. Banking offices Total assets Name of bank and type of transaction In To be operation operated The Union National Bank and Trust Company of Marquette, Marquette, Mich. (12027), with . . and UNB National Bank, Marquette, Mich. (12027), which had merged May 20, 1974, under charter of the latter bank (12027) and title "The Union National Bank and Trust Company of Marquette." The merged bank at date of merger had COMPTROLLER'S DECISION On November 1, 1973, The Union National Bank and Trust Company of Marquette, Marquette, Mich., and UNB National Bank (organizing), Marquette, Mich., applied to the Comptroller of the Currency for permission to merge under the charter of the latter and with the title of the former. The Union National Bank and Trust Company of Marquette, the merging bank, was organized in 1921 and now operates three branch offices. It possesses total assets of $39.7 million and IPC deposits of $27.9 million. The merging bank experiences its major competition from the only other bank located in Marquette, The First National Bank and Trust Company, which has deposits of $57.8 million and $44,992,581 120,000 44,992,581 4 0 4 is a member of Michigan National Bank and Trust Company. UNB National Bank, the charter bank, is being organized to provide a vehicle by which to transfer ownership of the merging bank to Northern States Bancorporation, Inc., a bank holding company. The charter bank will not be operating as a commercial bank prior to this merger. Northern States Bancorporation, Inc., is the multi-bank holding company which now controls City National Bank of Detroit, with deposits of $768.7 million, and Bank of Lansing, with deposits of $150.5 million. In addition, it has received approval to acquire First National Bank of Lake City, with deposits of $20 million, and has applications pending to acquire three other banks. Northern 141 States Bancorporation, Inc., and its subsidiaries have total assets of $1.1 billion. Competition between the merging bank and the subsidiaries of Northern States Bancorporation, Inc., is nonexistent since they operate in different sections of Michigan. Affiliation with Northern States Bancorporation, Inc., will allow the resulting bank to offer improved and expanded services, such as a larger lending limit through increased capital funds, international services, and improved managerial resources. Applying the statutory criteria, it is the opinion of this Office that the proposed transaction is in the public interest and will result in no adverse com- petitive effects. This application is, therefore, approved. APRIL 10, 1974. SUMMARY OF REPORT BY ATTORNEY GENERAL The proposed merger is part of a plan through which The Union National Bank and Trust Company of Marquette would become a subsidiary of Northern States Bancorporation, Inc., a bank holding company. The instant merger, however, would merely combine an existing bank with a non-operating institution; as such, and without regard to the acquisition of the surviving bank by Northern States Bancorporation, Inc., it wouid have no effect on competition. BALDWIN NATIONAL BANK OF ROBERTSDALE, ROBERTSDALE, ALA., AND GULF COAST NATIONAL BANK OF ROBERTSDALE, ROBERTSDALE, ALA. Banking offices Name of bank and type of transaction Total assets In operation Baldwin National Bank of Robertsdale, Robertsdale, Ala. (15402), with and Gulf Coast National Bank of Robertsdale, Robertsdale, Ala. (15402), which had merged May 31, 1974, under charter of the latter bank (15402) and title "Baldwin National Bank of Robertsdale." The merged bank at date of merger had COMPTROLLER S DECISION On November 14, 1973, Baldwin National Bank of Robertsdale, Robertsdale, Ala., and Gulf Coast National Bank of Robertsdale (organizing), Robertsdale, Ala., applied to the Comptroller of the Currency for permission to merge under the charter of the latter and with the title of the former. Baldwin National Bank of Robertsdale, Robertsdale, Ala., the merging bank, was converted from the former State-chartered Central Baldwin Bank of Robertsdale in 1964 and now, with total deposits of $8.7 million, operates two branches, one each in the towns of Fairhope and Loxley. The bank's service area is a section of south-central Baldwin County extending from Mobile Bay on the west of the Florida State line on the east and a distance of some 7 miles north and 11 miles south of Robertsdale, to include the towns of Daphne, Fairhope, Foley, and Loxley. The service area, with a population estimated at 25,000, has a moderately growing economy based primarily on agriculture and to a lesser degree on tourism and light industry. Competition for Baldwin National Bank of Robertsdale is provided by the $22.8 million-deposit 142 $11,168,649 60,000 11,289,219 To be operated 3 0 3 First National Bank of Fairhope; the $15.9 milliondeposit Farmers and Merchants Bank, Foley; the $15.1 million-deposit Baldwin County Bank, Bay Minette; the $13.7 million-deposit First National Bank of Bay Minette; and the $11.1 million-deposit South Baldwin Bank, Foley. Gulf Coast National Bank of Robertsdale, the charter bank, is being organized to provide a vehicle by which to transfer ownership of the merging bank to Alabama Bancorporation, Inc., Birmingham, Ala., a registered bank holding company. The charter bank will not be operating as a commercial bank prior to consummation of the proposed transaction. Alabama Bancorporation, Inc., Birmingham, Ala., the bank holding company which will acquire the resulting bank, was incorporated in 1970 and now, controlling eight banks with aggregate deposits of $1.1 billion, it is the largest multi-bank holding company in the State. The principal subsidiary of the holding company is The First National Bank of Birmingham, with deposits of approximately $806 million. There is no significant competition between the merging bank and the subsidiaries of Alabama Bancorporation, Inc., because 17 miles separate their closest offices and because Mobile Bay, which is in the intervening distance, constitutes an effective geographic barrier. Consummation of the proposed transaction will result in no adverse competitive effects. Affiliation with the holding company will allow the resulting subsidiary to compete more effectively with the larger banks in its service area because it will be able to offer a wider range of more sophisticated banking services to the residents and businesses located therein. Applying the statutory criteria, it is the opinion of this Office that the proposed transaction is in the public interest and will result in no adverse competi- tive effects. This application is, therefore, approved. FEBRUARY 5, 1974. SUMMARY OF REPORT BY ATTORNEY GENERAL The proposed merger is part of a plan through which Baldwin National Bank of Robertsdale would become a subsidiary of Alabama Bancorporation, a bank holding company. The instant merger, however, would merely combine an existing bank with a non-operating institution; as such, and without regard to the acquisition of the surviving bank by Alabama Bancorporation, it would have no effect on competition. DELAWARE VALLEY NATIONAL BANK, CHERRY HILL, N.J., AND NEW JERSEY NATIONAL BANK - SOUTH, CHERRY HILL, N.J. Banking offices Name of bank and type of transaction Total assets In operation Delaware Valley National Bank, Cherry Hill, N.J. (14975), with and New Jersey National Bank - South, Cherry Hill, N.J. (14975), which had merged May 31, 1974, under charter of the latter bank (14975) and title "New Jersey National Bank - Delaware Valley." The merged bank at date of merger had COMPTROLLER'S DECISION On February 4, 1974, Delaware Valley National Bank, Cherry Hill, N.J., and New Jersey National Bank - South (organizing), Cherry Hill, N.J., applied to the Comptroller of the Currency for permission to merge under the charter of the latter and with the title "New Jersey National Bank - Delaware Valley." Delaware Valley National Bank, the merging bank, was chartered in 1961 and now operates one branch office. With total assets of $23.2 million and IPC deposits of $19.2 million, it ranks 120th in deposit size among the 176 banks in New Jersey. The service area of this bank encompasses Cherry Hill Township, a residential suburban community with a population of 67,000. Competitors for the merging bank include banks located in Philadelphia and Camden and, also, South Jersey National Bank, a member of Heritage Bancorporation; and United Jersey National Bank of Cherry Hill, with deposits of $8.1 million, a member of United Jersey Banks. New Jersey National Bank - South, the charter bank, is being organized to provide a vehicle by which to transfer ownership of the merging bank to $22,544,003 247,438 22,791,440 To be operated 2 0 2 New Jersey National Corporation, Trenton, N.J. The charter bank will not be operating as a commercial bank prior to consummation of the proposed transaction. New Jersey National Corporation, the registered bank holding company that will acquire the resulting bank, was chartered in 1971 and now has two banking subsidiaries. New Jersey National Bank, Trenton, its lead subsidiary, has deposits of $652 million. Competition between the merging bank and the existing subsidiaries of New Jersey National Corporation is minimal as their closest offices are separated by a distance of approximately 32 miles and the intervening area contains more than 40 offices of other banks. Consummation of the proposed transaction will result in no adverse competitive effects. Rather, affiliation with New Jersey National Corporation will allow the resulting bank to utilize the services, facilities, management skills, and experience of the holding company's subsidiaries thus making it a stronger competitive institution. Applying the statutory criteria, it is the opinion of this Office that the proposed transaction is in the public interest and will result in no adverse competi- 143 tive effects. The application, therefore, is approved. MAY 1, 1974. SUMMARY OF REPORT BY ATTORNEY GENERAL The proposed merger is part of a plan through which Delaware Valley National Bank would become a subsidiary of New Jersey National Corporation, a bank holding company. The instant merger, however, would merely combine an existing bank with a non-operating institution; as such, and without regard to the acquisition of the surviving bank by New Jersey National Corporation, it would have no effect on competition. FIRST SAFETY FUND NATIONAL BANK, FITCHBURG, MASS., AND MONTACHUSETT NATIONAL BANK, FITCHBURG, MASS. Banking offices Name of bank and type of transaction Total assets In operation First Safety Fund National Bank, Fitchburg, Mass. (2153), with and Montachusett National Bank, Fitchburg, Mass. (2153), which had merged June 4, 1974, under charter of the latter bank (2153) and title "First Safety Fund National Bank." The merged bank at date of merger had COMPTROLLER'S DECISION On November 21, 1973, Montachusett National Bank (organizing), Fitchburg, Mass., and First Safety Fund National Bank, Fitchburg, Mass., applied to the Comptroller of the Currency for permission to merge under the charter of the former and with the title of the latter. First Safety Fund National Bank, the existing bank, was organized in 1874 and now operates five branches serving Worcester County with assets of $55 million and IPC deposits of $37.2 million. Montachusett National Bank is being organized to provide a vehicle by which to transfer total ownership of First Safety Fund National Bank to The Safety Fund Corporation. The new bank will not be operating as a commercial bank prior to this merger. Because First Safety Fund National Bank is the only operating bank involved in the proposed transaction, there can be no adverse effect on competi- 144 $54,663,070 120,000 To be operated 6 0 57,414,272 6 tion resulting from consummation of the proposed merger. The resulting bank will conduct the same banking business at the same locations and with the same name as presently used by the existing bank. Applying the statutory criteria, it is concluded that the proposed merger is in the public interest and this application is, therefore, approved. MAY 3, 1974. SUMMARY OF REPORT BY ATTORNEY GENERAL The proposed merger is part of a plan through which First Safety Fund National Bank would become a subsidiary of The Safety Fund Corporation, a bank holding company. The instant merger, however, would merely combine an existing bank with a non-operating institution; as such, and without regard to the acquisition of the surviving bank by The Safety Fund Corporation, it would have no effect on competition. COLONIAL FIRST NATIONAL BANK, RED BANK, N.J., AND NEW COLONIAL FIRST NATIONAL BANK, RED BANK, N.J. Banking offices Total assets Name of bank and type of transaction In operation Colonial First National Bank, Red Bank, N.J. (2257), with and New Colonial First National Bank, Red Bank, N.J. (2257), which had merged June 28, 1974, under charter of the latter bank (2257) and title "Colonial First National Bank." The merged bank at date of merger had COMPTROLLER'S DECISION On December 26, 1973, Colonial First National Bank, Red Bank, N.J., and New Colonial First National Bank (organizing), Red Bank, N.J., applied to the Comptroller of the Currency for permission to merge under the charter of the latter and with the title of the former. Colonial First National Bank, the merging bank, was chartered in 1875, and now operates 18 branch offices and has received approval to open four additional branches. It has total assets of $325.7 million and IPC deposits of $256 million. The service area of the bank encompasses Monmouth County and a small section of northeastern Mercer County. Competitors of the merging bank include The Central Jersey Bank and Trust Company, with deposits of $360 million; First Merchants National Bank, with deposits of $197 million; Peoples National Bank of Monmouth County, with deposits of $57 million, a member of United Jersey Banks; and First National State Bank of the Jersey Coast, with deposits of $31 million, a member of First National State Bancorporation. New Colonial First National Bank, the charter bank, is being organized to provide a vehicle by which to transfer ownership of the merging bank to Fidelity Union Bancorporation, Newark, N.J. The charter bank will not be operating as a commercial bank prior to consummation of the proposed transaction. Fidelity Union Bancorporation, the registered bank holding company that will acquire the resulting bank, has assets of $1.1 billion and deposits of $1 billion. It wholly owns four subsidiary banks and owns 21 percent of the Latin American Bank, located in Costa Rica. Its lead subsidiary, Fidelity Union Trust Company, with deposits of $727.7 million, has an investment in Allied Bank International. Competitors of Fidelity Union Trust Company $319,943,314 125,000 To be operated 18 0 319,943,314 18 include The Howard Savings Bank, with deposits of $1.3 billion; First National State Bank of New Jersey, with deposits of $943 million, a member of First National State Bancorporation; and Midlantic National Bank, with deposits of $809.2 million, an affiliate of Midlantic Banks Inc. Competition between the merging bank and the subsidiaries of Fidelity Union Bancorporation is minimal. While the closest subsidiary of Fidelity Union Bancorporation, the Spotswood office of The National Bank of New Jersey, is located only 8 miles from the merging bank, neither bank generates a significant volume of loans from the service area of the other. Consummation of the proposed transaction will result in no adverse competitive effects. Rather, the affiliation of the resulting bank with Fidelity Union Bancorporation will enhance competition because improved and expanded services will be offered, such as the availability of funds for larger loans, expertise in trust services, computer services, an international department, credit cards, overdraft banking, and a more competitive rate on time deposits. Applying the statutory criteria, it is the opinion of this Office that the proposed transaction is in the public interest and will result in no adverse competitive effects. This application is, therefore, approved. MAY 29, 1974. SUMMARY OF REPORT BY ATTORNEY GENERAL The proposed merger is part of a plan through which Colonial First National Bank would become a subsidiary of Fidelity Union Bancorporation, a bank holding company. The instant merger, however, would merely combine an existing bank with a nonoperating institution; as such, and without regard to the acquisition of the surviving bank by Fidelity Union Bancorporation, it would have no effect on competition. 145 GLEN NATIONAL BANK AND TRUST COMPANY, WATKINS GLEN, N.Y., AND BANK OF WATKINS GLEN, NATIONAL ASSOCIATION, WATKINS GLEN, N.Y. Banking offices Total assets Name of bank and type of transaction In operation Glen National Bank and Trust Company, Watkins Glen, N.Y. (9977), with and Bank of Watkins Glen, National Association, Watkins Glen, N.Y. (9977), which had merged June 28, 1974, under charter of the latter bank (9977) and title "Glen National Bank and Trust Company." The merged bank at date of merger had COMPTROLLER'S DECISION On October 9, 1973, Bank of Watkins Glen, National Association (organizing), Watkins Glen, N.Y., and Glen National Bank and Trust Company, Watkins Glen, N.Y., applied to the Comptroller of the Currency for permission to merge under the charter of the former and with the title of the latter. Glen National Bank and Trust Company, the existing bank, was organized in 1911 and now operates one branch office. It has assets of $16.4 million and IPC deposits of $13.1 million. The service area of the bank includes the village of Watkins Glen and all of Schuyler County which has an estimated population of 18,000. The economy of the service area is dependent mainly upon the tourism generated by international auto racing events which take place there, dairy farming, and the manufacture of salt, crane equipment, and lumber products. Competition for Glen National Bank and Trust Company, which is ranked 19th in size among the 33 banks headquartered in New York's Seventh Banking District, is provided by Marine Midland BankSouthern, Elmira, with deposits of $295 million; Finger Lakes National Bank, Odessa, with deposits of $8 million; and Montour National Bank in Montour Falls, with deposits of $7 million. Bank of Watkins Glen, National Association, the new bank, is being organized to provide a vehicle by which to transfer ownership of Glen National Bank and Trust Company to Security New York State Corporation. The new bank will not be operating as a commercial bank prior to this merger. Security New York State Corporation, the bank holding company which will acquire the resulting bank, was organized in 1966 and now ranks 13th in size among the 15 multi-bank holding companies located in New York State. The holding company 146 $17,425,365 60,000 To be operated 2 0 17,485,364 2 now owns eight banking subsidiaries in upstate New York, the largest of which is Security Trust Company, Rochester, with deposits of $438.4 million. There is minimal competition between the subsidiaries of Security New York State Corporation and Glen National Bank and Trust Company because their two closest offices are separated by a distance of 21 miles and an adequate number of alternative banking facilities operate in the intervening distances. Consummation of the proposed merger will both stimulate competition in Schuyler County and further economic development in the area because the resulting subsidiary in Watkins Glen will be able to offer new and improved services such as an increased lending limit, credit cards, cash reserve checking, payroll service and salary deposit plans, equipment leasing, and expanded trust services. Acquisition of the existing bank by Security New York State Corporation would also remove head office protection in Watkins Glen and open that community to de novo branching by other banks. Applying the statutory criteria, it is concluded that the proposed merger is in the public interest and this application is, therefore, approved. MAY 6, 1974. SUMMARY OF REPORT BY ATTORNEY GENERAL The proposed merger is part of a plan through which Glen National Bank and Trust Company would become a subsidiary of Security New York State Corporation, a bank holding company. The instant merger, however, would merely combine an existing bank with a non-operating institution; as such, and without regard to the acquisition of the surviving bank by Security New York State Corporation, it would have no effect on competition. THE FIRST NATIONAL BANK OF EASTHAMPTON, EASTHAMPTON, MASS., AND EASTHAMPTON BANK (NATIONAL ASSOCIATION), EASTHAMPTON MASS. Banking offices Name of bank and type of transaction Total assets The First National Bank of Easthampton, Easthampton, Mass. (428), with and Easthampton Bank (National Association), Easthampton, Mass. (428), which had merged June 28, 1974, under charter of the latter bank (428) and title "The First National Bank of Easthampton." The merged bank at date of merger had COMPTROLLER S DECISION On February 28, 1974, The First National Bank of Easthampton, Easthampton, Mass., and Easthampton Bank (National Association) (organizing), Easthampton, Mass., applied to the Comptroller of the Currency for permission to merge under the charter of the latter and with the title of the former. The First National Bank of Easthampton, the merging bank, was organized in 1864 and operates as a unit institution. It has total assets of $11.4 million and IPC deposits of $8 million. Easthampton, which has a population of 13,018, and its neighboring communities comprise the service area of the bank. The major competitor of the merging bank is Easthampton Savings Bank with deposits of $60.2 million. Easthampton Bank (National Association), the charter bank, is being organized to provide a vehicle by which to transfer ownership of the merging bank to Baystate Corporation, Boston, Mass. The charter bank will not be operating as a commercial bank prior to consummation of the proposed transaction. Baystate Corporation, Boston, Mass., the registered bank holding company which will acquire the resulting bank, controls 10 banking subsidiaries. It has total consolidated assets of $1.7 billion and total deposits of $1.4 billion. Norfolk County Trust Company, Brookline, its lead subsidiary, has deposits of $286.7 million. Competitors for Baystate Corporation include the larger Boston banks and also Cambridge Savings Bank, with deposits of $262.9 million; Third National Bank of Hampden County, with deposits of $210.8 million; Brookline Savings Bank, with deposits of $133.8 million; and Waltham Savings Bank, with $12,412,230 120,000 In To be operation operated 1 0 1 12,532,230 deposits of $102.2 million. Competition between the merging bank and the existing subsidiaries of Baystate Corporation is insignificant. Even though one existing subsidiary, Valley Bank and Trust Company, Springfield, has a number of banking offices located 8 to 22 miles from the proposed subsidiary, only a limited amount of competition exists between them. Consummation of the proposed transaction will result in no adverse competitive effects. Rather, application of Baystate Corporation will allow the resulting subsidiary to expand its service area to enhance competition, and will allow it to offer new and improved services such as a drive-up and walk-up teller facility, credit card services, a larger lending capacity through loan participations, and expertise in accounts receivable and inventory financing, auditing, real estate, and commercial and installment lending. Applying the statutory criteria, it is concluded that the proposed transaction is in the public interest and will result in no adverse competitive effects. This application is, therefore, approved. MAY 29, 1974. SUMMARY OF REPORT BY ATTORNEY GENERAL The proposed merger is part of a plan through which The First National Bank of Easthampton would become a subsidiary of Baystate Corporation, a bank holding company. The instant merger, however, would merely combine an existing bank with a non-operating institution; as such, and without regard to the acquisition of the surviving bank by Baystate Corporation, it would have no effect on competition. 147 THE FIRST NATIONAL BANK OF CRANBURY, CRANBURY, N J., AND MIDLANTIC NATIONAL BANK/CRANBURY, CRANBURY, N.J. Banking offices Total assets Name of bank and type of transaction In operation The First National Bank of Cranbury, Cranbury, N.J. (3168), with and Midlantic National Bank/Cranbury, Cranbury, N.J. (3168), which had merged June 30, 1974, under charter of the latter bank (3168) and title "The First National Bank of Cranbury." The merged bank at date of merger had COMPTROLLER'S DECISION On January 2, 1974, The First National Bank of Cranbury, Cranbury, N.J., and Midlantic National Bank/Cranbury (organizing), Cranbury, N.J., applied to the Comptroller of the Currency for permission to merge under the charter of the latter and with the title of the former. The First National Bank of Cranbury, Cranbury, N.J., the merging bank, was organized in 1884 and now has total assets of $43 million and IPC deposits of $33.8 million. It operates two branch offices, and has received approval to open a third branch. The service area of the merging bank encompasses the southern third of Middlesex County, a small portion of northern Monmouth County, and most of Mercer County. Competitors of the merging bank include The National Bank of Jersey, New Brunswick, which has deposits of $178 million and is a member of Fidelity Union Bancorporation; First Charter National Bank, which has deposits of $129 million and is a member of Heritage Bancorporation; and The Edison Bank, National Association, South Plainfield, which has deposits of $75 million and is a member of First National State Bancorporation. Midlantic National Bank/Cranbury, Cranbury, N.J., the charter bank, is being organized to provide a vehicle by which to transfer ownership of the merging bank to Midlantic Banks, Inc., Newark, N.J. It will not be operating as a commercial bank prior to consummation of the proposed transaction. Midlantic Banks, Inc., Newark, N.J., the corporation that will acquire the resulting bank, is the third largest bank holding company in New Jersey. It controls eight subsidiary banks with aggregate 148 $42,021,786 126,321 To be operated 3 0 42,146,786 3 deposits of $1.4 billion. Midlantic National Bank, Newark, with deposits of $809.2 million, is its lead subsidiary. Competitors for Midlantic Banks, Inc., include First National State Bancorporation, with aggregate deposits of $1.7 billion, and United Jersey Banks, with aggregate deposits of $1.5 billion. Competition between the merging bank and the existing subsidiaries of Midlantic Banks, Inc., is minimal because the closest existing subsidiary is located approximately 14 miles from the merging bank and each holds only nominal deposits from the service area of the other. Consummation of the proposed transaction will result in no adverse competitive effects. Rather, affiliation with Midlantic Banks, Inc., will allow the resulting bank to offer improved and expanded services in the areas of commercial loans, trust services, automated services, international financing, and management support. Applying the statutory criteria, it is the opinion of this Office that the proposed transaction is in the public interest and will result in no adverse competitive effects. This application is, therefore, approved. MAY 31, 1974. SUMMARY OF REPORT BY ATTORNEY GENERAL The proposed merger is part of a plan through which The First National Bank of Cranbury would become a subsidiary of Midlantic Banks Inc., a bank holding company. The instant merger, however, would merely combine an existing bank with a nonoperating institution; as such, and without regard to the acquisition of the surviving bank by Midlantic Banks Inc., it would have no effect on competition. FIRST NATIONAL BANK & TRUST COMPANY IN ALTON, ALTON, I I I . , AND FIRST NATIONAL BANK & TRUST COMPANY, ALTON, I I I . Banking offices Total assets Name of bank and type of transaction In operation First National Bank & Trust Company in Alton, Alton, 111. (13464), with and First National Bank & Trust Company, Alton, 111. (13464), which had merged July 1, 1974, under charter and title of the latter bank (13464). The merged bank at date of merger had COMPTROLLER S DECISION On February 4, 1974, First National Bank & Trust Company in Alton, Alton, 111., and First National Bank & Trust Company (organizing), Alton, 111., applied to the Comptroller of the Currency for permission to merge under the charter and title of the latter. First National Bank & Trust Company in Alton, the merging bank, is a unit institution located in Alton. The bank has assets of $63.3 million and IPC deposits of $51.9 million. First National Bank & Trust Company, the charter bank, is being organized as a vehicle by which to transfer ownership of the merging bank to First Illinois Bancshares, Wilmington, Del., which will become a one-bank holding company upon its acquisition of the resulting bank. The charter bank will not be operating as a commercial bank prior to the merger. Because the merging bank is the only operating bank involved in the proposed transaction, there can $68,012,524 122,017 To be operated 1 0 1 68,134,540 be no adverse effect on competition resulting from consummation of the proposed merger. The resulting bank will conduct the same banking business at the same location presently used by the merging bank. Applying the statutory criteria, it is concluded that the proposed merger is in the public interest and this application is, therefore, approved. MAY 17, 1974. SUMMARY OF REPORT BY ATTORNEY GENERAL The proposed merger is part of a plan through which First National Bank & Trust Company in Alton would become a subsidiary of First Illinois Bancshares Corporation, a bank holding company. The instant merger, however, would merely combine an existing bank with a non-operating institution; as such, and without regard to the acquisition of the surviving bank by First Illinois Bancshares Corporation, it would have no effect on competition. SEATTLE-FIRST NATIONAL BANK, SEATTLE, WASH., AND SEAFIRST NATIONAL BANK, SEATTLE, WASH. Banking offices Name of bank and type of transaction Total assets In operation Seattle-First National Bank, Seattle, Wash. (11280), with $3,804,266,937 240,000 and SeaFirst National Bank, Seattle, Wash. (11280), which had merged July 1, 1974, under charter of the latter bank (11280) and title "Seattle-First National Bank." The merged bank at date of merger had 3,804,277,833 COMPTROLLER S DECISION On February 12, 1974, SeaFirst National Bank (organizing), Seattle, Wash., and Seattle-First National Bank, Seattle, Wash., applied to the Comptroller of the Currency for permission to merge under the charter of the former and with the title of the latter. To be operated 148 0 Seattle-First National Bank, the existing bank, was organized in 1870 and now, with total assets of $4 billion and IPC deposits of $2.6 billion, is the largest bank in Washington. With 146 branches Seattle-First National Bank serves the entire State of Washington where it competes with five bank branching systems ranging in size from $250 million to $2 billion. 149 SeaFirst National Bank, the new bank, is being organized to provide a vehicle by which to transfer ownership of the existing bank to SeaFirst Corporation, Seattle, Wash., which will become a one-bank holding company upon its acquisition of the resulting bank. SeaFirst National Bank will not be operating as a commercial bank prior to this merger. Because Seattle-First National Bank is the only operating bank involved in the proposed transaction, there can be no adverse effect on competition resulting from consummation of the proposed merger. The resulting bank will conduct the same banking business at the same locations and with the same name as presently used by the existing bank. Applying the statutory criteria, it is concluded that the proposed merger is in the public interest and this application is, therefore, approved. MAY 16, 1974. SUMMARY OF REPORT BY ATTORNEY GENERAL The proposed merger is part of a plan through which Seattle-First National Bank would become a subsidiary of SeaFirst Corporation, a bank holding company. The instant merger, however, would merely combine an existing bank with a non-operating institution; as such, and without regard to the acquisition of the surviving bank by SeaFirst Corporation, it would have no effect on competition. THE FIRST NATIONAL BANK OF MARYLAND, BALTIMORE, MD., AND CHARLES STREET NATIONAL BANK, BALTIMORE, MD. Banking offices Total assets Name of bank and type of transaction In operation The First National Bank of Maryland, Baltimore, Md. (1413), with and Charles Street National Bank, Baltimore, Md. (1413), which had merged July 8, 1974, under charter of the latter bank (1413) and title "The First National Bank of Maryland." The merged bank at date of merger had COMPTROLLER'S DECISION On April 8, 1974, Charles Street National Bank (organizing), Baltimore, Md., and The First National Bank of Maryland, Baltimore, Md., applied to the Comptroller of the Currency for permission to merge under the charter of the former and with the title of the latter. The First National Bank of Baltimore, the existing bank, was organized in 1806 and presently has total assets of $1.1 billion and IPC deposits of $697 million. With 59 branches, the existing bank serves the city of Baltimore and Anne Arundel, Baltimore, Harford, Howard, Montgomery, Washington, and Wicomico counties. The economy of that area is based upon a wide array of commercial and industrial activity. Competition for The First National Bank of Maryland is provided by Maryland National Bank, Baltimore, with deposits of $1.3 billion; Equitable Trust Bank, Baltimore, with deposits of $846 million, which is a member of Equitable Bancorporation; Suburban Trust Company, Hyattsville, with deposits 150 $1,051,922,932 252,802 1,070,965,761 To be operated 63 0 63 of $684 million; Union Trust Company of Maryland, Baltimore, with deposits of $611 million; Citizens Bank and Trust Company of Maryland, Riverdale, with deposits of $331 million; and Mercantile-Safe Deposit & Trust Company, Baltimore, with deposits of $244 million, which is a member of Mercantile Bankshares Corporation. Charles Street National Bank, the new bank, is being organized to provide a vehicle by which to transfer ownership of The First National Bank of Maryland to First Maryland Bancorp, Baltimore, Md., which will become a one-bank holding company upon its acquisition of the resulting bank. Charles Street National Bank will not be operating as a commercial bank prior to this merger. Since The First National Bank of Maryland is the only operating bank involved in the proposed transaction, there can be no adverse effect on competition resulting from consummation of the proposed merger. The resulting bank will conduct the same banking business at the same locations and with the same name as presently used by The First National Bank of Maryland. Applying the statutory criteria, it is concluded that the proposed merger is in the public interest and this application is, therefore, approved. JUNE 6, 1974. SUMMARY OF REPORT BY ATTORNEY GENERAL The proposed merger is part of a plan through which The First National Bank of Maryland would become a subsidiary of First Maryland Bancorp., a bank holding company. The instant merger, however, would merely combine an existing bank with a non-operating institution; as such, and without regard to the acquisition of the surviving bank by First Maryland Bancorp., it would have no effect on competition. THE CLEVELAND NATIONAL BANK, CLEVELAND, TENN., AND CLEVELAND INTERIM BANK, N.A., CLEVELAND, TENN. Banking offices Name of bank and type of transaction Total assets In operation The Cleveland National Bank, Cleveland, Tenn. (1666), with and Cleveland Interim Bank, N.A., Cleveland, Tenn. (1666), which had merged July 18, 1974, under charter of the latter bank (1666) and title "The Cleveland National Bank." The merged bank at date of merger had COMPTROLLER'S DECISION On February 19, 1974, The Cleveland National Bank, Cleveland, Tenn., and Cleveland Interim Bank, N.A. (organizing), Cleveland, Tenn., applied to the Comptroller of the Currency for permission to merge under the charter of the latter and with the title of the former. The Cleveland National Bank, the existing bank, was organized in 1867 and presently operates four branches with total assets of $46.4 million and IPC deposits of $37.2 million. The primary service area of the existing bank encompasses all of Bradley County which has a population of 51,000. The economy of that area is based on a wide array of industry. Direct competition for The Cleveland National Bank is provided by Merchants Bank, Cleveland, which has deposits of $35.4 million and is a member of Third National Corporation, and by Cleveland Bank and Trust Company, Cleveland, which has deposits of $31.1 million and has reached an agreement-in-principle to be acquired by First Tennessee National Corporation. In addition, First Citizens Bank of Cleveland has been issued a new charter and will soon open. Cleveland Interim Bank, N.A., the new bank, is being organized to provide a vehicle by which to $44,689,570 125,000 45,890,248 To be operated 5 0 5 transfer ownership of The Cleveland National Bank to First Amtenn Corporation, Nashville, Tenn. The new bank will not be operating as a commercial bank prior to this merger. First Amtenn Corporation, the bank holding company which will acquire the resulting bank, is the second largest multi-bank holding company in Tennessee and presently controls six banks with aggregate deposits of $904 million. Its lead bank is First American National Bank of Nashville, with deposits of $786 million. There is no competition between the subsidiaries of First Amtenn Corporation and The Cleveland National Bank because of the distance which separates their nearest two offices and the adequate number of alternative banking facilities operating in the intervening area. The nearest subsidiary of the holding company is Volunteer-State Bank which is located in Knoxville, 76 miles northeast of Cleveland. Consummation of the proposed merger will stimulate competition in Bradley County because the resulting subsidiary in Cleveland will be able to offer new and improved services such as corporate trust and investment management services, data processing services, accounts receivable financing, international banking, and leasing services. In addition, 151 the resulting bank will have access to First Amtenn Corporation's managerial expertise and training program. Consummation of the proposed merger will not significantly affect the size of First Amtenn Corporation in relation to that of the other multibank holding companies in the State. Applying the statutory criteria, it is concluded that the proposed merger is in the public interest and this application is, therefore, approved. JUNE 18, 1974. SUMMARY OF REPORT BY ATTORNEY GENERAL The proposed merger is part of a plan through which The Cleveland National Bank would become a subsidiary of First Amtenn Corporation, a bank holding company. The instant merger, however, would merely combine an existing bank with a nonoperating institution; as such, and without regard to the acquisition of the surviving bank by First Amtenn Corporation, it would have no effect on competition. GUARANTY NATIONAL BANK AND TRUST OF CORPUS CHRISTI, CORPUS CHRISTI, TEX., AND GUARANTY COMMERCE NATIONAL BANK, CORPUS CHRISTI, TEX. Banking offices Total assets Name of bank and type of transaction In operation Guaranty National Bank and Trust of Corpus Christi, Corpus Christi, Tex. (14988), with and Guaranty Commerce National Bank, Corpus Christi, Tex. (14988), which had merged July 26, 1974, under charter of the latter bank (14988) and title "Guaranty National Bank & Trust of Corpus Christi." The merged bank at date of merger had COMPTROLLER'S DECISION On December 12, 1974, Guaranty National Bank and Trust of Corpus Christi, Corpus Christi, Tex., and Guaranty Commerce National Bank (organizing), Corpus Christi, Tex., applied to the Comptroller of the Currency for permission to merge under the charter of the latter and with the title of "Guaranty National Bank & Trust of Corpus Christi." Guaranty National Bank and Trust of Corpus Christi, the merging bank, was organized in 1962 and operates as a unit institution. It has total assets of $32 million and IPC deposits of $25.6 million. The service area of the bank is the Corpus Christi Standard Metropolitan Statistical Area which is comprised of Nueces and San Patricio counties. Competitors for the merging bank include Corpus Christi State National Bank, which has deposits of $193.3 million and is a subsidiary of Federated Capital Corporation; Corpus Christi Bank and Trust, which has deposits of $117 million and is a subsidiary of First City Bancorporation of Texas, Inc.; and Parkdale State Bank, which has deposits of $26.3 million and has received permission to become affiliated with Frost Bank Corporation. Guaranty Commerce National Bank, Corpus Christi, Tex., the charter bank, is being organized to provide a vehicle by which to transfer ownership of the merging bank to Texas Commerce Banc152 $30,937,598 240,000 31,822,439 To be operated 1 0 1 shares, Inc., Houston, Tex. The charter bank will not be operating as a commercial bank prior to consummation of the proposed merger. Texas Commerce Bancshares, Inc., the bank holding company that will acquire the resulting bank, controls 15 banking subsidiaries with aggregate deposits of $1.8 billion and is the fourth largest bank holding company in Texas. The corporation also has applications to acquire 10 additional banks announced or pending. Texas Commerce Bank, National Association, with deposits of $1.2 billion, is its lead subsidiary. Competitors of Texas Commerce Bank, National Association, include First City National Bank of Houston, which has deposits of $1.8 billion and is a subsidiary of First City Bancorporation of Texas, Inc.; Bank of the Southwest, National Association, which has deposits of $774.5 million and is a member of Southwest Bancshares, Inc.; and Houston Citizens Bank and Trust, which has deposits of $237 million. In addition, competition is provided by the local banks operating in the service areas of Texas Commerce Bancshares, Inc.'s remaining subsidiaries. Direct competition between the merging bank and the existing subsidiaries of Texas Commerce Bancshares, Inc., is nonexistent as their closest offices are separated by a distance of approximately 210 miles and as Texas Commerce Bank, National Asso- ciation, has been providing management assistance to the merging bank. Consummation of the proposed transaction will result in no adverse competitive effects. Rather, affiliation with Texas Commerce Bancshares, Inc., will allow the resulting bank to become a stronger competitor by offering improved and expanded services such as a larger lending capacity through loan participation, large real estate financing, leasing services, accounting services to small businesses, a new oil and gas department, and expanded trust and investment services. Applying the statutory criteria, it is the view of this Office that the proposed transaction is in the public interest and will result in no adverse competitive effects. This application is, therefore, approved. JUNE 25, 1974. SUMMARY OF REPORT BY ATTORNEY GENERAL The proposed merger is part of a plan through which Guaranty National Bank and Trust of Corpus Christi would become a subsidiary of Texas Commerce Bancshares, Inc., a bank holding company. The instant merger, however, would merely combine an existing bank with a non-operating institution; as such, and without regard to the acquisition of the surviving bank by Texas Commerce Bancshares, Inc., it would have no effect on competition. THE PROSPECT PARK NATIONAL BANK, WAYNE, N.J., AND FIRST PROSPECT PARK NATIONAL BANK, WAYNE, N.J. Banking offices Total assets Name of bank and type of transaction In operation The Prospect Park National Bank, Wayne, N.J. (12861), with and First Prospect Park National Bank, Wayne, N.J. (12861), which had merged Aug. 1, 1974, under charter of the latter bank (12861) and title "Prospect Park National Bank." The merged bank at date of merger had COMPTROLLER'S DECISION On February 25, 1974, The Prospect Park National Bank, Wayne, N.J., and First Prospect Park National Bank (organizing), Wayne, N.J., applied to the Comptroller of the Currency for permission to merge under the charter of the latter and with the title "Prospect Park National Bank." The Prospect Park National Bank, the merging bank, was organized in 1925 and now operates four branch offices. It has total assets of $200.2 million and IPC deposits of $167.2 million. The service area of the bank encompasses the eastern sector of Passaic county and a portion of western Bergen County. Competitors of the merging bank include National Community Bank, Rutherford, with deposits of $610 million; New Jersey Bank (National Association), Clifton, which has deposits of $598 million and is a member of Greater Jersey Bancorporation; and First National Bank of New Jersey, Totowa, which has deposits of $452 million. First Prospect Park National Bank, the charter bank, is being organized to provide a vehicle by $202,844,663 250,000 203,094,663 To be operated 5 0 5 which to transfer ownership of the merging bank to Bancshares of New Jersey, Moorestown, N.J. The charter bank will not be operating as a commercial bank prior to consummation of the proposed merger. Bancshares of New Jersey, Moorestown, N.J., is the registered bank holding company which will acquire the resulting bank. It ranks 13th in deposit size among the commercial banking corporations in New Jersey. It operates one banking subsidiary, The Bank of New Jersey, Camden, with deposits of $460 million. Competitors of Bancshares of New Jersey include United Jersey Banks, with aggregate deposits of $1.4 billion; Midlantic Banks, Inc., with aggregate deposits of $1.4 billion; and First National State Bancorporation, with aggregate deposits of $1.4 billion. Direct competition between the merging bank and the subsidiary of Bancshares of New Jersey is nonexistent as their closest offices are separated by a distance of approximately 100 miles and an adequate number of banking alternatives operate in the intervening distance. Consummation of the proposed transaction will 153 result in no adverse competitive effects. Affiliation with Bancshares of New Jersey will allow the resulting bank to offer expanded and improved services such as an automatic teller system, municipal bond bidding, construction loans, consumer loans, computer services, and trust services. Applying the statutory criteria, it is the opinion of this Office that the proposed transaction is in the public interest and will result in no adverse competitive effects. This application is, therefore, approved. JUNE 14, 1974. SUMMARY OF REPORT BY ATTORNEY GENERAL The proposed merger is part of a plan through which The Prospect Park National Bank would become a subsidiary of Bancshares of New Jersey, a bank holding company. The instant merger, however, would merely combine an existing bank with a non-operating institution; as such, and without regard to the acquisition of the surviving bank by Bancshares of New Jersey, it would have no effect on competition. * * * FIRST NATIONAL BANK OF HURST, HURST, TEX., AND HURST COMMERCE NATIONAL BANK, HURST, TEX. Banking offices Name of bank and type of transaction Total assets In operation First National Bank of Hurst, Hurst, Tex. (15072), with and Hurst Commerce National Bank, Hurst, Tex. (15072), which had merged Aug. 2, 1974, under charter of the latter bank (15072) and title "First National Bank of Hurst." The merged bank at date of merger had COMPTROLLER'S DECISION On August 2, 1973, First National Bank of Hurst, Hurst, Tex., and Hurst Commerce National Bank (organizing), Hurst, Tex., applied to the Comptroller of the Currency for permission to merge under the charter of the latter and with the title of the former. First National Bank of Hurst, Hurst, Tex., the merging bank was established in 1956 and operates as a unit institution. With total assets of $31.1 million and IPC deposits of $22 million, it ranks 17th in size among the 45 banks in the Fort Worth area. Its service area encompasses a group of suburban cities in northwest Tarrant County, which includes Hurst, Bedford, Euless, Richland Hills, North Richland Hills, Colleyville, and the extreme northeastern portion of Fort Worth. The major competitors of First National Bank of Hurst include Northeast National Bank, Fort Worth, with deposits of $34.3 million; First State Bank, Bedford, with deposits of $13.4 million; and First National Bank of Euless, with deposits of $11.7 million. Hurst Commerce National Bank, Hurst, Tex., the charter bank, is being organized to provide a vehicle by which to transfer ownership of the merging bank to Texas Commerce Bancshares, Inc., Houston, Tex. It will not be operating as a commercial bank prior to consummation of the proposed merger. Texas Commerce Bancshares, Inc., Houston, Tex., the organization that will acquire the resulting 154 $34,699,809 120,000 35,155,066 To be operated 1 0 1 bank, is the fourth largest bank holding company in Texas. It controls 15 banking subsidiaries with aggregate deposits of $1.8 billion, and has applications pending or announced to acquire 10 additional banks. Texas Commerce Bank, National Association, with deposits of $1.2 billion, is the applicant's principal subsidiary. Competitors of Texas Commerce Bancshares, Inc.'s lead subsidiary include First City National Bank of Houston, which has deposits of $1.8 billion and is a subsidiary of First City Bancorporation of Texas, Inc.; Bank of Southwest, National Association, which has deposits of $774.5 million and is a member of Southwest Bancshares, Inc.; and Houston National Bank, which has deposits of $366.5 million. Additional competition is provided by the banks operating in the service areas of the applicant's remaining subsidiaries. Direct competition between First National Bank of Hurst and the subsidiaries of Texas Commerce Bancshares, Inc., is nonexistent since their closest offices are separated by a distance of approximately 235 miles. Consummation of the proposed transaction will result in no adverse competitive effects. Affiliation with a holding company will allow First National Bank of Hurst to offer new and expanded services, such as investment services, trust services, real estate financing, and international banking. Applying the statutory criteria, it is the opinion of this Office that the proposed transaction is in the public interest and will result in no adverse competitive effects. This application is, therefore, approved. JUNE 19, 1974. SUMMARY OF REPORT BY ATTORNEY GENERAL The proposed merger is part of a plan through which First National Bank of Hurst would become a subsidiary of Texas Commerce Bancshares, Inc., a bank holding company. The instant merger, however, would merely combine an existing bank with a non-operating institution; as such, and without regard to the acquisition of the surviving bank by Texas Commerce Bancshares, Inc., it would have no effect on competition. * * * FIRST CITY NATIONAL BANK OF GADSDEN, GADSDEN, ALA., AND BANK OF GADSDEN, N.A., GADSDEN, ALA. Banking offices Total assets Name of bank and type of transaction In operation First City National Bank of Gadsden, Gadsden, Ala. (15481), with and Bank of Gadsden, N.A., Gadsden, Ala. (15481), which had merged Aug. 7, 1974, under charter of the latter bank (15481) and title "First City National Bank of Gadsden." The merged bank at date of merger had COMPTROLLER'S DECISION On March 8, 1974, First City National Bank of Gadsden, Gadsden, Ala., and Bank of Gadsden, N.A. (organizing), Gadsden, Ala., applied to the Comptroller of the Currency for permission to merge under the charter of the latter and with the title of the former. First City National Bank of Gadsden, the merging bank, was organized in 1965, and now has assets of $40.2 million and IPC deposits of approximately $28 million. The bank operates no branches since branch banking is not permitted in the county. The economy of the service area of First City National Bank of Gadsden is aided by the presence of the Coosa River which provides the area with excellent waterway transportation. By virtue of its location as county seat of Etowah County, Gadsden serves as a center of commerce, industry, and finance. Competition for First City National Bank of Gadsden is provided by Alabama City Bank of Gadsden, with deposits of $24.8 million; The American National Bank, Gadsden, with deposits of $40.7 million; Central Bank of Alabama, N.A., with deposits of $351.4 million; the Coosa Valley Bank, Gadsden, with deposits of $9.1 million; and East Gadsden Bank, Gadsden, with deposits of $15.8 million. Bank of Gadsden, N.A., the new bank, is being organized to provide a vehicle by which to transfer ownership of First City National Bank of Gadsden to First Alabama Bancshares, Inc. Bank of Gadsden, N.A., will not be operating as a commercial bank prior to this merger. $39,865,899 240,000 39,873,099 To be operated 1 0 1 First Alabama Bancshares, Inc., Birmingham, Ala., the bank holding company which will acquire the resulting bank, was organized in April 1971 and is now the second largest banking organization in Alabama and the second largest of the seven multibank holding companies in the State. The bank holding company, with aggregate deposits of $774.4 million, presently controls six banks located in various cities throughout the State. The largest subsidiary bank is The First National Bank of Montgomery, Montgomery, Ala., with deposits of $280.3 million. The remaining five subsidiaries are located in Birmingham, Huntsville, Dothan, Bay Minette, and Tuscaloosa. This holding company also controls two non-banking subsidiaries which sell credit life, health, and accident insurance, and engage in the leasing of personal property and business equipment. There is no competition between the bank holding company or its subsidiaries and First City National Bank of Gadsden because large distances separate their closest two offices and an adequate number of alternative banking facilities operate in the intervening distances. The holding company's nearest subsidiary is Exchange Security Bank, Birmingham, located approximately 61 miles from Gadsden, which operates in an area that is separate and distinct from that served by the merging bank. Consummation of the proposed transaction will not adversely affect competition in Etowah County, the primary service area of First City National Bank of Gadsden. Affiliation of First City National Bank of Gadsden with First Alabama Bancshares, Inc. will 155 enable the merging bank to increase the range of banking services available to the customers in its service area, particularly in the fields of lease financing, trust services, and corporate financing. In addition, approval of this transaction will provide First National City Bank of Gadsden with the opportunity to strengthen its internal operations and staff through the expertise that would be available from holding company. The bank's ability to satisfy large lines of credit would also be expanded through its ability to sell participations to the holding company's other subsidiaries. Applying the statutory criteria it is the conclusion of this Office that the proposed merger is in the public interest and will not result in any adverse competitive effects. This application is, therefore, approved. JULY 8, 1974. SUMMARY OF REPORT BY ATTORNEY GENERAL The proposed merger is part of a plan through which First City National Bank of Gadsden would become a subsidiary of First Alabama Bancshares, Inc., a bank holding company. The instant merger, however, would merely combine an existing bank with a non-operating institution; as such, and without regard to the acquisition of the surviving bank by First Alabama Bancshares, Inc., it would have no effect on competition. LAFAYETTE NATIONAL BANK, LAFAYETTE, IND., AND TIPPECANOE NATIONAL BANK, LAFAYETTE, IND. Banking offices Name of bank and type of transaction Total assets In operation On May 3, 1973, Lafayette National Bank, Lafayette, Ind., and Tippecanoe National Bank (organizing), Lafayette, Ind., applied to the Comptroller of the Currency for permission to merge under the charter of the latter and with the title of the former. Lafayette National Bank, the existing bank, was organized in 1934 and presently operates seven branches through which it serves the city of Lafayette. It has total assets of $110 million and IPC deposits of $85 million. The economy of the existing bank's service area is based on a wide array of industrial activity. Competition for Lafayette National Bank is provided by Purdue National Bank of Lafayette, with deposits of $105 million; Lafayette Bank and Trust, with deposits of $53 million; and Lafayette Savings Bank, with deposits of $42 million. Tippecanoe National Bank, the new bank, is being organized to provide a vehicle by which to transfer ownership of Lafayette National Bank to Lafayette National Corporation, Lafayette, Ind., which will become a one-bank holding company upon its acquisition of the resulting bank. Tippecanoe National 156 119,487,343 ; COMPTROLLER'S DECISION $119,363,743 123,600 COO Lafayette National Bank, Lafayette, Ind. (14175), with and Tippecanoe National Bank, Lafayette, Ind. (14175), which had merged Aug. 19, 1974, under charter of the latter bank (14175) and title "Lafayette National Bank." The merged bank at date of merger had To be operated 8 Bank will not be operating as a commercial bank prior to this merger. Since Lafayette National Bank is the only operating bank involved in the proposed transaction, there can be no adverse effect on competition resulting from consummation of the proposed merger. The resulting bank will conduct the same banking business at the same locations and with the same name as presently used by Lafayette National Bank. Applying the statutory criteria, it is concluded that the proposed merger is in the public interest and this application is, therefore, approved. JULY 2, 1974. SUMMARY OF REPORT BY ATTORNEY GENERAL The proposed merger is part of a plan through which Lafayette National Bank would become a subsidiary of Lafayette National Corporation, a bank holding company. The instant merger, however, would merely combine an existing bank with a nonoperating institution; as such, and without regard to the acquisition of the surviving bank by Lafayette National Corporation, it would have no effect on competition. FARMERS-FIRST NATIONAL BANK OF STEPHENVILLE, STEPHENVILLE, TEX., AND STEPHENVILLE NATIONAL BANK, STEPHENVILLE, TEX. Banking offices Total assets Name of bank and type of transaction In operation Farmers-First National Bank of Stephenville, Stephenville, Tex. (12730), with and Stephenville National Bank, Stephenville, Tex. (12730), which had merged Aug. 26, 1974, under charter of the latter bank (12730) and title "Farmers-First National Bank of Stephenville." The merged bank at date of merger had COMPTROLLER'S DECISION On January 29, 1974, Farmers-First National Bank of Stephenville, Stephenville, Tex., and Stephenville National Bank (organizing), Stephenville, Tex., applied to the Comptroller of the Currency for permission to merge under the charter of the latter and with the title of the former. Farmers-First National Bank of Stephenville, the existing bank, was organized in 1906 and now has total assets of $31.1 million and IPC deposits of $23.5 million. The primary service area of the bank consists of Stephenville and the surrounding area of Erath County. The economy of that area is based on agriculture and livestock production. Direct competition for Farmers-First National Bank of Stephenville is provided by Stephenville Bank and Trust Company, Stephenville, with deposits of $14.5 million. Additional minor competition in the outlying areas of Erath County is provided by The Dublin National Bank, Dublin, with deposits of $12.8 million; First National Bank, Hico, with deposits of $5.7 million; Citizens State Bank, Somerville, with deposits of $6.5 million; First National Bank of Granbury, with deposits of $8.7 million; and Granbury State Bank, with deposits of $4.1 million. Stephenville National Bank, is being organized to provide a vehicle by which to transfer ownership of Farmers-First National Bank of Stephenville to First United Bancorporation, Inc., Fort Worth. The new bank will not be operating as a commercial bank prior to this merger. First United Bancorporation, Inc., the bank holding company which will acquire the resulting bank, $31,259,735 120,000 To be operated 1 0 1 31,379,735 controls eight subsidiary banks, the largest of which is The First National Bank of Fort Worth, with deposits of $590 million. There is no significant competition between the subsidiaries of First United Bancorporation, Inc., and Farmers-First National Bank of Stephenville because a large distance separates their two closest offices and an adequate number of alternative banking facilities operate in the intervening area. The nearest subsidiary of the holding company is Cleburne National Bank, located over 50 miles away. Consummation of the proposed merger will stimulate competition in Stephenville because the resulting subsidiary bank will be able to offer new and improved services to the community such as agricultural credit, long term real estate loans, educational loans, trust services, letters of credit, and securities appraisal, custody, and transfer. Applying the statutory criteria, it is concluded that the proposed merger is in the public interest and this application is, therefore, approved. JULY 22, 1974. SUMMARY OF REPORT BY ATTORNEY GENERAL The proposed merger is part of a plan through which Farmers-First National Bank of Stephenville would become a subsidiary of First United Bancorporation, Inc., a bank holding company. The instant merger, however, would merely combine an existing bank with a non-operating institution; as such, and without regard to the acquisition of the surviving bank by First United Bancorporation, Inc., it would have no effect on competition. 157 PLAZA NATIONAL BANK, SECAUCUS, N.J., AND SECOND PLAZA NATIONAL BANK, SECAUCUS, NJ. Banking offices Name of bank and type of transaction Total assets In operation Plaza National Bank, Secaucus, N.J. (15228), with and Second Plaza National Bank, Secaucus, N.J. (15228), which had merged Aug. 30, 1974, under charter of the latter bank (15228) and title "Plaza National Bank. The merged bank at date of merger had COMPTROLLER'S DECISION On May 3, 1974, Plaza National Bank, Secaucus, N.J., and Second Plaza National Bank (organizing), Secaucus, N.J., applied to the Comptroller of the Currency for permission to merge under the charter of the latter and with the title of "Plaza National Bank." The Plaza National Bank, the merging bank, was established in January 1964, and presently operates three offices in Hudson County. The head office and one branch are located in Secaucus, the second branch is in West New York, N.J. The bank's primary service area includes the communities of Secaucus, West New York, and Union City. On June 30, 1973, the Plaza National Bank, with $28.6 million in total assets and $23.5 million in IPC deposits, ranked eighth among the 11 commercial banks headquartered in Hudson County. Competition is provided by The First Jersey National Bank, Jersey City, with deposits of $447 million, which is a member of First Jersey National Corporation, a registered bank holding company with total deposits of $447 million; The Trust Company of New Jersey, Jersey City, with deposits of $233 million, which is a member of Wilshire Oil Company of Texas, a registered bank holding company with deposits of $233 million; Commercial Trust Company of New Jersey, Jersey City, with deposits of $224 million; Hudson United Bank, Union City, with deposits of $166 million; The First National Bank and Trust Company of Kearny, with deposits of $59 million; Meadowlands National Bank, North Bergen, with deposits of $34 million; Broadway National Bank of Bayonne, with deposits of $25 million; and Garden State National Bank, Hackensack, with deposits of $426 million, which is a member of Warner Communications, Inc., a registered bank holding company with deposits of $426 million. In addition, Arcadia National Bank opened for business in Secaucus on January 25, 1974. Arcadia is an affiliate of National Community Bank of Rutherford, which holds deposits of $610 million. 158 To be operated $28,612,000 120,000 27,341,608 Second Plaza National Bank, the charter bank, was organized in December 1973 to provide a vehicle by which to transfer ownership of the merging bank to the Greater Jersey Bancorp., a registered bank holding company. The charter bank will not be operating prior to this merger. The effect of the proposed merger on competition must be measured with regard to the two existing banking subsidiaries of Greater Jersey Bancorp. Greater Jersey Bancorp., Clifton, N.J., the bank holding company which will acquire the resulting bank, was organized by its lead subsidiary bank, New Jersey Bank (National Association), Clifton, in April 1972. Provident Bank of New Jersey, Willingboro, with deposits of $40 million, is the only other bank presently owned by Greater Jersey Bancorp. On December 31, 1973, with $711 million in deposits, it ranked sixth in size among the 20 registered bank holding companies in New Jersey. The larger holding companies are First National State Bancorporation, with nine member banks and total deposits of $1.7 billion; United Jersey Banks, with 17 member banks and total deposits of $1.4 billion; Midlantic Banks, Inc., with eight member banks and total deposits of $1.4 billion; Fidelity Union Bancorporation, with four member banks and total deposits of $1 billion; and Heritage Bancorporation, with three member banks and total deposits of $814 million. Acquisition of Plaza National Bank would result in Greater Jersey Bancorp, holding $735 million in deposits and continuing as the sixth largest holding company in the State. Competition between the Plaza National Bank and either subsidiary of Greater Jersey Bancorp, is insignificant. The closest offices are approximately 4 miles apart and are separated by densely populated communities with numerous banking alternatives. Consummation of the proposed merger will result in no adverse competitive effects. Affiliation with the applicant will allow the proposed subsidiary to compete more effectively with the larger banks located in its service area by offering improved and expanded services such as trust and data processing services, an international banking department, line of credit checking, and automated teller machines. In addition, the physical facilities of the proposed subsidiary will be improved. Applying the statutory criteria, it is concluded that the proposed merger is in the public interest and the application is, therefore, approved. JULY 23, 1974. SUMMARY OF REPORT BY ATTORNEY GENERAL The proposed merger is part of a plan through which Plaza National Bank would become a subsidiary of Greater Jersey Bancorp., a bank holding company. The instant merger, however, would merely combine an existing bank with a non-operating institution; as such, and without regard to the acquisition of the surviving bank by Greater Jersey Bancorp., it would have no effect on competition. THE ATHENS NATIONAL BANK, ATHENS, OHIO, AND THE ATHENS, OHIO F.B.G. NATIONAL BANK OF ATHENS, Banking offices Total assets Name of bank and type of transaction In operation The Athens National Bank, Athens, Ohio (7744), with and The F.B.G. National Bank of Athens, Athens, Ohio (7744), which had merged Sept. 16, 1974, under charter of the latter bank (7744) and title "The Athens National Bank." The merged bank at date of merger had COMPTROLLER'S DECISION On July 11, 1974, The Athens National Bank, Athens, Ohio, and The F.B.G. National Bank of Athens (organizing), Athens, Ohio, applied to the Comptroller of the Currency for permission to merge under the charter of the latter and with the title of the former. The Athens National Bank, the existing bank, was organized in 1905 and now operates four branch offices with total assets of $47.9 million and IPC deposits of $32.8 million. It ranks as the largest bank among the eight banks in Athens County, its service area. The Athens National Bank is now owned by United Dairy Farmers Investment Company, a registered bank holding company which has agreed to divest itself of ownership of the bank by 1981. Competitors of The Athens National Bank include Peoples Bank in Nelsonville, with deposits of $16.7 million; Hockins Valley Bank of Athens Company, with deposits of $15 million; and First National Bank of Nelsonville, with deposits of $6.5 million. The F.B.G. National Bank of Athens, the charter bank, is being organized to provide a vehicle by which to transfer ownership of the merging bank to First Bane Group of Ohio, Inc., Columbus, Ohio, a registered bank holding company. The charter bank will not be operating as a commercial bank prior to this merger. $47,557,941 120,000 To be operated 5 0 47,767,192 5 First Bane Group of Ohio, Inc., is the fifth largest bank holding company in Ohio, controlling 14 banking subsidiaries with aggregate deposits of $1 billion. That holding company has an application pending to acquire a bank in Sidney and has also announced plans to acquire a bank in Toledo. Among competitors of the applicant are BancOhio Corporation, with total deposits of $2.3 billion; Centran Corporation, with total deposits of $1.6 billion; and Union Commerce Corporation, with total deposits of $1.1 billion. Direct competition between the proposed subsidiary and the existing subsidiaries of the applicant is insignificant since their closest offices are separated by a distance of approximately 70 miles. Consummation of the proposed transaction will result in no adverse competitive effects. Affiliation with the applicant will allow the resulting bank to offer improved and expanded services in such areas as commercial and educational lending, trust services, and international services. Applying the statutory criteria, it is concluded that the proposed merger is in the public interest and the application is, therefore, approved. AUGUST 15, 1974. SUMMARY OF REPORT BY ATTORNEY GENERAL The proposed merger is part of a plan through 159 which The Athens National Bank would become a subsidiary of First Bane Group of Ohio, Inc., a bank holding company. The instant merger, however, would merely combine an existing bank with a non- operating institution; as such, and without regard to the acquisition of the surviving bank by First Bane Group of Ohio, Inc., it would have no effect on competition. THE CITIZENS BAUGHMAN NATIONAL BANK, SIDNEY, OHIO, AND THE C.B. NATIONAL BANK OF SIDNEY, SIDNEY, OHIO Banking offices Total assets Name of bank and type of transaction In operation The Citizens Baughman National Bank, Sidney, Ohio (7862), with and The C.B. National Bank of Sidney, Sidney, Ohio (7862), which had merged Sept. 30,1974, under charter of the latter bank (7862) and title "The Citizens Baughman National Bank." The merged bank at date of merger had COMPTROLLER'S DECISION On March 26, 1974, The Citizens Baughman National Bank, Sidney, Ohio, and The C.B. National Bank of Sidney (organizing), Sidney, Ohio, applied to the Comptroller of the Currency for permission to merge under the charter of the latter and the title of the former. The Citizens Baughman National Bank, the existing bank, was organized in 1870 and now has assets of $46.6 million and IPC deposits of $33.9 million. It has six offices in Shelby County, a rural area with an estimated population of 40,500, and is the largest of four banks headquartered in the county. The C.B. National Bank of Sidney, the charter bank, is being organized to provide a vehicle by which to transfer ownership of the existing bank to First Bane Group of Ohio, Inc., a multi-bank holding company. The charter bank will not be operating as a commercial bank prior to this merger. First Bane Group of Ohio, Inc., the sixth largest of 12 multi-bank holding companies in Ohio, controls 14 banks with $948 million in deposits. The subsidiary closest to the existing bank is located 10 miles away in Auglaize County. There is no existing competition between those banks due to the lack of 160 $48,629,073 120,000 To be operated 6 0 48,629,073 6 major social orientation or economic links between the communities in which the two banks are located, and the projected growth patterns of those counties are not expected to create new links. Consummation of the proposed transaction will result in no adverse competitive effects. The resulting bank will conduct the same banking business at the same location and with the same name as presently used by the existing bank. Applying the statutory criteria, it is concluded that the proposed merger is in the public interest and is, therefore, approved. AUGUST 7, 1974. SUMMARY OF REPORT BY ATTORNEY GENERAL The proposed merger is part of a plan through which The Citizens Baughman National Bank would become a subsidiary of First Bane Group of Ohio, Inc., a bank holding company. The instant merger, however, would merely combine an existing bank with a non-operating institution; as such, and without regard to the acquisition of the surviving bank by First Bane Group of Ohio, Inc., it would have no effect on competition. THE FIRST NATIONAL BANK OF EVART, EVART, MICH., AND EVART BANK, N.A., EVART, MICH. Banking offices Total assets Name of bank and type of transaction In operation $8,766,912 60,000 The First National Bank of Evart, Evart, Mich. (12561), with and Evart Bank, N.A., Evart, Mich. (12561), which had merged Oct. 10, 1974, under charter of the latter bank (12561) and title "The First National Bank of Evart." The merged bank at date of merger had COMPTROLLER S DECISION On May 13, 1974, The First National Bank of Evart, Evart, Mich., and Evart Bank, N.A. (organizing), Evart, Mich., applied to the Comptroller of the Currency for permission to merge under the charter of the latter and with the title of the former. The First National Bank of Evart, the merging bank, was organized in 1924 and operates as a unit institution. It has total assets of $7.4 million and IPC deposits of $6 million. Evart and the surrounding area comprise the service area of the merging bank. Its competitors include Central Michigan Bank and Trust Company, Barryton, with deposits of $28.4 million; Mid-Michigan Bank, Farwell, with deposits of $26.8 million; The Reed City State Bank, Reed City, with deposits of $12.8 million; and LakeOsceola State Bank, Tustin, with deposits of $10.9 million. Evart Bank, N.A., the charter bank, is being organized to provide a vehicle by which to transfer ownership of the merging bank to West Michigan Financial Corporation, Cadillac, Mich. The charter bank will not be operating as a commercial bank prior to consummation of the proposed transaction. West Michigan Financial Corporation is the bank holding company that will acquire the resulting bank. It was organized in 1973 and controls one banking subsidiary, The Cadillac State Bank, Cadillac, with deposits of $81.2 million. Competitors for this subsidiary include First National Bank of Lake City, with deposits of $19.9 million, and First National Bank of Cadillac, with deposits of $17 million. To be operated 1 0 1 8,749,913 Direct competition between the merging bank and the subsidiary of West Michigan Financial Corporation is minimal since their closest offices are separated by a distance of 19 miles. Consummation of the proposed transaction will result in no adverse competitive effects. Affiliation with West Michigan Financial Corporation will allow the resulting bank to become a stronger competitor by offering a wider range of more sophisticated banking services, such as free checking account plans, larger commercial and industrial loans through participations, trust services, higher interest rates on time and savings deposits, commercial data processing, physical improvements, and extended banking hours. Applying the statutory criteria, it is the opinion of this Office that the proposed transaction is in the public interest and will result in no adverse competitive effects. This application is, therefore, approved. SEPTEMBER 10, 1974. SUMMARY OF REPORT BY ATTORNEY GENERAL The proposed merger is part of a plan through which The First National Bank of Evart would become a subsidiary of West Michigan Financial Corporation, a bank holding company. The instant merger, however, would merely combine an existing bank with a non-operating institution; as such, and without regard to the acquisition of the surviving bank by West Michigan Financial Corporation, it would have no effect on competition. 161 THE COLONIAL-AMERICAN NATIONAL BANK OF ROANOKE, ROANOKE, VA., AND COLONIAL BANK, N.A., ROANOKE, VA. Banking offices Total assets Name of bank and type of transaction In operation The Colonial-American National Bank of Roanoke, Roanoke, Va. (11817), with and Colonial Bank, N.A., Roanoke, Va. (11817), which had merged Oct. 31, 1974, under charter of the latter bank (11817) and title "Colonial-American National Bank." The merged bank at date of merger had COMPTROLLER'S DECISION On August 15, 1974, The Colonial-American National Bank of Roanoke, Roanoke, Va., and Colonial Bank, N.A. (organizing), Roanoke, Va., applied to the Comptroller of the Currency for permission to merge under the charter of the latter and with the title "Colonial-American National Bank," with its main office in Roanoke County, Va. The Colonial-American National Bank of Roanoke, the merging bank, is headquartered in Roanoke, Va., and has 11 branch offices located throughout Roanoke County. The bank, with total assets of $148.5 million and IPC deposits of $113.6 million, was chartered originally in 1929. Colonial Bank, N.A., the charter bank, is being organized to provide a vehicle by which to transfer ownership of the merging bank to Colonial-American Bankshares Corporation, Roanoke, Va., which will become a registered one-bank holding company upon acquisition of the resulting bank. The charter bank will not be operating as a commercial bank prior to this merger. Because the merging bank is the only operating $166,217,889 238,500 To be operated 11 0 166,236,629 11 bank involved in the proposed transaction, there can be no adverse effect on competition resulting from consummation of the proposed merger. The resulting bank will conduct the same banking business at the same locations as presently used by the merging bank. Applying the statutory criteria, it is concluded that the proposed merger is in the public interest and this application is, therefore, approved. SEPTEMBER 30, 1974. SUMMARY OF REPORT BY ATTORNEY GENERAL The proposed merger is part of a plan through which The Colonial-American National Bank of Roanoke would become a subsidiary of ColonialAmerican Bankshares Corporation, a bank holding company. The instant merger, however, would merely combine an existing bank with a non-operating institution; as such, and without regard to the acquisition of the surviving bank by Colonial-American Bankshares Corporation, it would have no effect on competition. THE FIRST NATIONAL BANK IN CLEBURNE, CLEBURNE, TEX., AND JOHNSON COUNTY NATIONAL BANK, CLEBURNE, TEX. Banking offices Total assets Name of bank and type of transaction In operation The First National Bank in Cleburne, Cleburne, Tex. (13107), with and Johnson County National Bank, Cleburne, Tex. (13107), which had merged Nov. 1, 1974, under charter of the latter bank (13107) and title "The First National Bank in Cleburne." The merged bank at date of merger had COMPTROLLER'S DECISION On July 15, 1974, The First National Bank in Cleburne, Cleburne, Tex., and Johnson County National Bank (organizing), Cleburne, Tex., applied 162 $35,545,084 125,000 35,670,084 To be operated 1 0 1 to the Comptroller of the Currency for permission to merge under the charter of the latter and with the title of the former. The First National Bank in Cleburne, the existing bank, was organized in 1927 and operates as a unit institution. It has total assets of $32.4 million and IPC deposits of $28.6 million. The service area of First National Bank in Cleburne is Johnson County where its competitors include Cleburne National Bank which has deposits of $17.5 million and is a member of First United Bancorporation, Inc.; First State Bank, Rio Vista, which has deposits of $20 million; and Farmers and Merchants State Bank, Burleson, which has deposits of $11 million. Johnson County National Bank, the new bank, is being organized to provide a vehicle by which to transfer ownership of the existing bank to First International Bancshares, Inc., Dallas, Tex., a registered bank holding company. The new bank will not be operating as a commercial bank prior to this merger. First International Bancshares, Inc., is the largest bank holding company in Texas, controlling 16 banking subsidiaries with aggregate deposits of $2.6 billion. It has applied for approval to acquire five additional banks. First National Bank in Dallas, with deposits of $2.4 billion, is its lead subsidiary. Competitors for First National Bank in Dallas include Republic National Bank of Dallas, with deposits of $3 billion; Mercantile National Bank of Dallas, with deposits of $746 million; and National Bank of Commerce, with deposits of $296 million. Competition between the existing bank and subsidiaries of First United Bancorporation, Inc., is minimal since their closest offices are 49 miles apart. Thus, consummation of the proposed transaction will result in no adverse competitive effects. The merger will allow The First National Bank in Cleburne to offer new and expanded services such as a larger lending capacity, trust department services, investment counseling, and international services. Applying the statutory criteria, it is concluded that the proposed merger is in the public interest and this application is, therefore, approved. OCTOBER 2, 1974. SUMMARY OF REPORT BY ATTORNEY GENERAL The proposed merger is part of a plan through which The First National Bank in Cleburne would become a subsidiary of First International Bancshares, Inc., a bank holding company. The instant merger, however, would merely combine an existing bank with a non-operating institution; as such, and without regard to the acquisition of the surviving bank by First International Bancshares, Inc., it would have no effect on competition. PHENIX NATIONAL BANK, PHENIX CITY, ALA., AND BANK OF PHENIX, N.A., PHENIX CITY, ALA. Banking offices Total assets Name of bank and type of transaction In operation Phenix National Bank, Phenix City, Ala. (15053), with and Bank of Phenix, N.A., Phenix City, Ala. (15053), which had merged Nov. 14, 1974, under charter of the latter bank (15053) and title "Phenix National Bank." The merged bank at date of merger had COMPTROLLER S DECISION On July 4, 1974, the Phenix National Bank, Phenix City, Ala., and the Bank of Phenix, N.A. (organizing), Phenix City, Ala., applied to the Comptroller of the Currency for permission to merge under the charter of the latter and with the title of the former. Phenix National Bank, the merging bank, was organized in 1963 and now has IPC deposits of $12 million. The service area of the bank is metropolitan Phenix City, Ala., and Columbus, Ga., as well as the remaining parts of Russell County and the southeast tip of Lee County. $16,302,578 120,000 16,306,178 To be operated 3 0 3 Primary competitors of Phenix National Bank include Columbus Bank and Trust Co., with deposits of $141 million; First National Bank of Columbus, with deposits of $138 million; Fourth National Bank of Columbus, with deposits of $65 million; Trust Company of Georgia, with deposits of $26 million; Farmers and Merchants Bank of Russell County, Phenix City, with deposits of $17 million; First Bank of Russell County, Phenix City, with deposits of $2 million; and Phenix Girard Bank, with deposits of $17 million. Bank of Phenix, N.A., the charter bank, is being organized to provide a vehicle by which to transfer ownership of the merging bank to First Alabama 163 Bancshares, Inc., a registered bank holding company. The charter bank will not be operating prior to the merger. First Alabama Bancshares, Inc., Birmingham, Ala., was organized in 1971 and now is the second largest bank holding company in Alabama with aggregate deposits of $900 million. It controls nine banking subsidiaries located in various cities throughout the State. Its largest subsidiary is The First National Bank of Montgomery, Montgomery, Ala., with deposits of $282 million. The remaining subsidiaries are located in Birmingham, Huntsville, Dothan, Bay Minette, Tuscaloosa, Selma, Athens, and Guntersville. In addition, the holding company has received approval to acquire banks in Hartselle and Gadsden and has an additional application pending to acquire a bank in Bayou La Batre. Direct competition between Phenix National Bank and the subsidiaries of First Alabama Bancshares, Inc., is minimal since the closest subsidiary of the holding company, First National Bank of Montgomery, is 80 miles west of Phenix City. Consummation of the proposed transaction will result in no adverse competitive effects. Affiliation with the holding company will enable Phenix National Bank to offer an expanded range of services such as lease financing, corporate financing, corporate trust, and money market operations. Affiliation will also strengthen the bank's staff and internal operations. Applying the statutory criteria, it is concluded that the proposed merger is in the public interest and this application is, therefore, approved. OCTOBER 15, 1974. SUMMARY OF REPORT BY ATTORNEY GENERAL The proposed merger is part of a plan through which Phenix National Bank would become a subsidiary of First Alabama Bancshares, Inc., a bank holding company. The instant merger, however, would merely combine an existing bank with a nonoperating institution; as such, and without regard to the acquisition of the surviving bank by First Alabama Bancshares, Inc., it would have no effect on competition. VIRGINIA NATIONAL BANK/FAIRFAX, SPRINGFIELD, VA., AND COMMUNITY BANK AND TRUST COMPANY, SPRINGFIELD, VA. Banking offices Name of bank and type of transaction Total assets In operation Community Bank and Trust Company, Springfield, Va., with and Virginia National Bank/Fairfax, Springfield, Va. (16398), which had merged Nov. 18, 1974, under charter and title of the latter bank (16398). The merged bank at date of merger had COMPTROLLER S DECISION On June 25, 1974, Community Bank and Trust Company, Springfield, Va., and Virginia National Bank/Fairfax (organizing), Springfield, Va., applied to the Comptroller of the Currency for permission to merge under the charter of and with the title of the latter. The Community Bank and Trust Company, Springfield, Va., the merging bank, was organized in 1970 and operates from a single office. With assets of $5.7 million and IPC deposits of $3.7 million, the merging bank ranks as the smallest bank in Fairfax County. Competitors of the merging bank include Bank of Virginia-Potomac, Falls Church, with deposits of $147 million; Fairfax County National Bank, Seven 164 $6,686,779 240,000 6,926,779 To be operated 1 0 1 Corners, with deposits of $46 million; Peoples Bank and Trust Company of Fairfax, with deposits of $16 million; United Virginia Bank/First & Citizens National, with deposits of $348 million; and Northern Virginia Bank, with deposits of $96 million. Virginia National Bank/Fairfax, the new bank, is being organized to provide a vehicle by which to transfer ownership of Community Bank and Trust Company to Virginia National Bancshares, Incorporated. The new bank will not be operating as a commercial bank prior to this merger. Virginia National Bancshares, Incorporated, Norfolk, Va., a registered bank holding company, is Virginia's second largest banking organization. The holding company's subsidiary banks are Virginia National Bank/Norfolk; Virginia National Bank/ Lynchburg; Virginia National Bank/Henry County, Martinsville; and Virginia Trust Company, Richmond. Those affiliated banks have aggregate deposits of $1.4 billion and operate 121 banking offices. Direct competition between the Community Bank and Trust Company and the subsidiaries of Virginia National Bancshares, Incorporated, is minimal as the closest subsidiary, Virginia National Bank/Norfolk, has an office 6 miles north of the merging bank in a highly competitive region. Consummation of the proposed merger will stimulate competition in the Springfield service area because the resulting bank will be able to offer new and improved services to customers as a result of its affiliation with Virginia National Bancshares, Incorporated. Applying the statutory criteria, it is concluded that the proposed merger is in the public interest and this application is, therefore, approved. OCTOBER 16, 1974. SUMMARY OF REPORT BY ATTORNEY GENERAL The proposed merger is part of a plan through which Community Bank and Trust Company would become a subsidiary of Virginia National Bankshares, Inc., a bank holding company. The instant merger, however, would merely combine an existing bank with a non-operating institution; as such, and without regard to the acquisition of the surviving bank by Virginia National Bankshares, Inc., it would have no effect on competition. CENTRAL BANK, NATIONAL ASSOCIATION, GRAND RAPIDS, MICH., AND C. BANK, NATIONAL ASSOCIATION, GRAND RAPIDS, MICH. Banking offices Name of bank and type of transaction Total assets In operation Central Bank, National Association, Grand Rapids, Mich. (16037), with and C. Bank, National Association, Grand Rapids, Mich. (16037), which had merged Dec. 9, 1974, under charter of the latter bank (16037) and title "Central Bank, National Association." The merged bank at date of merger had COMPTROLLER'S DECISION On December 29, 1972, C. Bank, National Association (organizing), Grand Rapids, Mich., and Central Bank, National Association, Grand Rapids, Mich., applied to the Comptroller of the Currency for permission to merge under the charter of the former and with the title of the latter. Central Bank, National Association, the existing bank, was organized in 1934 and now has deposits of $43 million. At the present time, 22.4 percent of the common stock of this bank is owned by Michigan National Corporation and a majority of the remaining shares are owned by persons closely associated with that holding company. Competition for the bank is provided by Old Kent Bank and Trust Company, with deposits of $681 million; Union Bank and Trust Company, National Association, with deposits of $309 million; and an office of Michigan National Bank, Lansing, which is a subsidiary of Michigan National Corporation. $49,500,402 240,000 49,740,402 To be operated 9 0 9 C. Bank, National Association (organizing), the new bank, is being organized to provide a vehicle by which to transfer ownership of Central Bank, National Association, to Michigan National Corporation, Bloomfield Hills, Mich. C. Bank will not be operating as a commercial bank prior to this merger. Michigan National Corporation, the bank holding company which will acquire the resulting bank, is a recently organized corporation which controls several subsidiary banks with aggregate assets of $2.5 billion. All of those subsidiaries had been closely associated through common stock ownership prior to their acquisition by Michigan National Corporation. As already indicated, 22.4 percent of the stock of Central Bank is now owned by Michigan National Corporation and a majority of the remaining shares are owned by persons closely associated with that holding company. The proposed transaction is, therefore, merely part of an internal corporate reorganization which will not adversely affect the banking structure in Michigan. 165 Applying the statutory criteria, it is concluded that the proposed merger is in the public interest and is, therefore, approved. MAY 16, 1974. SUMMARY OF REPORT BY ATTORNEY GENERAL The proposed merger is part of a plan through which Central Bank, National Association, would become a subsidiary of Michigan National Corporation, a bank holding company. The instant merger, however, would merely combine an existing bank with a non-operating institution; as such, and without regard to the acquisition of the surviving bank by Michigan National Corporation, it would have no effect on competition. VALLEY NATIONAL BANK OF SAGINAW, SAGINAW, MICH., AND V. NATIONAL BANK, SAGINAW, MICH. Banking offices Name of bank and type of transaction Total assets In operation Valley National Bank of Saginaw, Saginaw, Mich. (15403), with and V. National Bank, Saginaw, Mich. (15403), which had merged Dec. 9, 1974, under charter of the latter bank (15403) and title "Valley National Bank of Saginaw." The merged bank at date of merger had COMPTROLLER'S DECISION On October 28, 1973, Valley National Bank of Saginaw, Saginaw, Mich., and V. National Bank (organizing), Saginaw, Mich., applied to the Comptroller of the Currency for permission to merge under the charter of the latter and with the title of the former. Valley National Bank of Saginaw, the existing bank, was organized in 1959 and currently operates five branch offices with total deposits of $43 million. Direct competition for the bank is provided by Second National Bank of Saginaw, with deposits of $247 million; First State Bank of Saginaw, with deposits of $15.9 million; and an office of Michigan National Bank, Lansing. V. National Bank, the new bank, is being organized to provide a vehicle by which to transfer ownership of Valley National Bank of Saginaw to Michigan National Corporation, Bloomfield Hills, Mich. The new bank will not be operating as a commercial bank prior to this merger. Michigan National Corporation, the bank holding company which will acquire the resulting bank, is headquartered in Bloomfield Hills and controls four subsidiary banks with aggregate deposits of $2.5 billion. The principal subsidiary of the holding company is Michigan National Bank of Detroit, with 166 $54,197,141 240,000 To be operated 6 0 54,437,141 6 deposits of $823 million. The remaining subsidiaries of this holding company are located in the cities of Livonia, Southfield, and Troy. The existing bank is, at the present time, indirectly controlled by Michigan National Corporation which owns a significant amount of the outstanding stock of Valley National Bank of Saginaw. This transaction is, therefore, merely part of an internal corporate reorganization which will solidify the operational relationship between Valley National Bank of Saginaw and Michigan National Corporation without altering the competitive banking structure in Michigan. Applying the statutory criteria, it is concluded that the proposed merger is in the public interest and this application is, therefore, approved. MAY 16, 1974. SUMMARY OF REPORT BY ATTORNEY GENERAL [This merger is a part] * * * of plans through which the existing banks will become subsidiaries of Michigan National Corporation. [It] * * *, however, will merely combine an existing bank with a nonoperating institution and without regard to the acquisition of the surviving banks by Michigan National Corporation, will have no effect on competition. THE GOGEBIC NATIONAL BANK OF IRONWOOD, IRONWOOD, MICH., AND GNB NATIONAL BANK, IRONWOOD, MICH. Banking offices Total assets Name of bank and type of transaction In operation The Gogebic National Bank of Ironwood, Ironwood, Mich. (9517), with and GNB National Bank, Ironwood, Mich. (9517), which had merged Dec. 13, 1974, under charter of the latter bank (9517) and title "Gogebic National Bank." The merged bank at date of merger had COMPTROLLER S DECISION On July 15, 1974, The Gogebic National Bank of Ironwood, Ironwood, Mich., and GNB National Bank (organizing), Ironwood, Mich., applied to the Comptroller of the Currency for permission to merge under the charter of the latter and with the title, "Gogebic National Bank." The Gogebic National Bank of Ironwood, Ironwood, Mich., the existing bank, was organized in 1909 and now has total deposits of $19 million. The bank operates solely from its head office in Ironwood and has an application pending to establish a branch in the unincorporated village of Watersmeet, Mich. The bank's principal competitor is First National Bank of Ironwood, with deposits of $19 million. Michigan Financial Corporation, Marquette, Mich., a registered bank holding company, with assets of $150 million, has applied for permission to acquire control of First National Bank of Ironwood. Additional competition in bank's service area is furnished by the Bessemer National Bank, Bessemer, Mich., with deposits of $10 million, and The Iron Exchange Bank, Hurley, Wis., with deposits of $9 million. GNB National Bank, the new bank, is being organized to provide a vehicle by which to transfer ownership of The Gogebic National Bank of Ironwood to First National Financial Corporation, Kalamazoo, Mich. The new bank will not be operating as a commercial bank prior to this merger. First National Financial Corporation, Kalamazoo, Mich., the bank holding company which will acquire the resulting bank, is the fourth largest bank holding company in Michigan and controls nine banking subsidiaries with aggregate deposits in excess of $21,624,600 120,000 To be operated 1 0 21,744,600 1 $450 million and total resources in excess of $505 million. First National Bank and Trust Company of Michigan, Kalamazoo, Mich., its largest subsidiary, has deposits of $321 million. Direct competition between Gogebic National Bank of Ironwood and the subsidiaries of the applicant is nonexistent since the nearest subsidiary of the applicant is located 83 miles southeast of Ironwood, Mich., and over 30 miles from the location of the bank's proposed branch. Consummation of the proposed merger will stimulate competition in Ironwood because the resulting subsidiary will expand the services it offers and will become more effective in its competition with the First National Bank of Ironwood. The proposed transaction will enable the resulting subsidiary to provide trust services, place overlines through the holding company system, and offer improved and more efficient banking services. Applying the statutory criteria, it is concluded that the proposed merger is in the public interest and this application is, therefore, approved. NOVEMBER 12, 1974. SUMMARY OF REPORT BY ATTORNEY GENERAL The proposed merger is part of a plan through which The Gogebic National Bank of Ironwood would become a subsidiary of First National Financial Corporation, a bank holding company. The instant merger, however, would merely combine an existing bank with a non-operating institution; as such, and without regard to the acquisition of the surviving bank by First National Financial Corporation, it would have no effect on competition. 167 FIRST NATIONAL BANK OF IRONWOOD, IRONWOOD, MICH., AND THE SECOND NATIONAL BANK OF IRONWOOD, IRONWOOD, MICH. Banking offices Total assets Name of bank and type of transaction In operation First National Bank of Ironwood, Ironwood, Mich. (14456), with and The Second National Bank of Ironwood, Ironwood, Mich. (14456), which had merged Dec. 30, 1974, under charter of the latter bank (14456) and title "First National Bank of Ironwood." The merged bank at date of merger had COMPTROLLER S DECISION On August 23, 1974, The Second National Bank of Ironwood (organizing), Ironwood, Mich., and First National Bank of Ironwood, Ironwood, Mich., applied to the Comptroller of the Currency for permission to merge under the charter of the former and with the title of the latter. First National Bank of Ironwood, the existing bank, was organized in 1941 and presently operates as a unit bank with total assets of $22 million and IPC deposits of $18.4 million. It now has an application pending for a branch office in Ironwood. The primary service area of the bank encompasses Ironwood and the surrounding area in the western portion of Michigan's upper peninsula. The principal economic activity in the service area is winter tourism. Competition for First National Bank of Ironwood is provided by Gogebic National Bank, Ironwood, with deposits of $18.6 million; The Bessemer National Bank, Bessemer, with deposits of $10 million; and The First National Bank, Wakefield, with deposits of $7.5 million. The Second National Bank of Ironwood, the new bank, is being organized to provide a vehicle by which to transfer ownership of the existing bank to Michigan Financial Corporation, Marquette, Mich. The new bank will not be operating as a commercial bank prior to this merger. Michigan Financial Corporation, the bank holding company which will acquire the resulting bank, is the 21st largest of the 38 bank holding companies in Michigan. It presently controls six banks, with aggregate deposits of $150 million. There is no competition between Michigan Finan- 168 $23,732,247 125,000 To be operated 1 0 23,294,692 1 cial Corporation or its subsidiaries and First National Bank of Ironwood because of the great distance between the banks. The nearest subsidiary of Michigan Financial Corporation, The Miners' First National Bank and Trust Company, is located in Ishpeming, 130 miles east of Ironwood. Much of the intervening land consists of public forests. Consummation of the proposed merger will stimulate competition in Michigan's upper peninsula because the resulting subsidiary in Ironwood will be able to offer new and improved services such as trust services, business development loans, Master Charge, minimum balance-no service charge checking accounts, and an increased rate of interest on statement savings accounts. In addition, the acquisition of the resulting bank by Michigan Financial Corporation will not significantly affect its size in relation to the other bank holding companies in Michigan. Applying the statutory criteria, it is concluded that the proposed merger is in the public interest and this application is, therefore, approved. NOVEMBER 13, 1974. SUMMARY OF REPORT BY ATTORNEY GENERAL The proposed merger is part of a plan through which First National Bank of Ironwood would become a subsidiary of Michigan Financial Corporation, a bank holding company. The instant merger, however, would merely combine an existing bank with a non-operating institution; as such, and without regard to the acquisition of the surviving bank by Michigan Financial Corporation, it would have no effect on competition. NATIONAL BANK OF COMMERCE OF PINE BLUFF, PINE BLUFF, ARK., AND JEFFERSON NATIONAL BANK, PINE BLUFF, ARK. Banking offices Total assets Name of bank and type of transaction In operation National Bank of Commerce of Pine Bluff, Pine Bluff, Ark. (14056), with and Jefferson National Bank, Pine Bluff, Ark. (14056), which had merged Dec. 31, 1974, under charter of the latter bank (14056) and title "National Bank of Commerce of Pine Bluff." The merged bank at date of merger had COMPTROLLER'S DECISION On July 2, 1974, National Bank of Commerce of Pine Bluff, Pine Bluff, Ark., and Jefferson National Bank (organizing), Pine Bluff, Ark., applied to the Comptroller of the Currency for permission to merge under the charter of the latter and with the title of the former. National Bank of Commerce of Pine Bluff, the existing bank, was organized in 1934 and presently operates five branches. It has total assets of $97 million and IPC deposits of $68 million. The primary service area of the existing bank encompasses all of Jefferson County. The economy of this service area is supported by a mixture of light industry and agriculturally related pursuits. Competition for National Bank of Commerce of Pine Bluff is provided by Simmons First National Bank of Pine Bluff, with deposits of $131 million; and Pine Bluff National Bank, Pine Bluff, with deposits of $8.6 million. Jefferson National Bank is being organized to provide a vehicle by which to transfer ownership of National Bank of Commerce of Pine Bluff to National Bancshares Corp., Pine Bluff, Ark., which will become a one-bank holding company upon its acquisition of the resulting bank. Jefferson National $106,827,438 250,000 To be operated 6 0 6 107,077,438 Bank will not be operating as a commercial bank prior to this merger. Because National Bank of Commerce of Pine Bluff is the only operating bank involved in the proposed transaction, there can be no adverse effect on competition resulting from consummation of the proposed merger. The resulting bank will conduct the same banking business at the same locations and with the same name as presently used by the existing bank. Applying the statutory criteria, it is concluded that the proposed merger is in the public interest and this application is, therefore, approved. NOVEMBER 29, 1974. SUMMARY OF REPORT BY ATTORNEY GENERAL The proposed merger is part of a plan through which National Bank of Commerce of Pine Bluff would become a subsidiary of National Bancshares Corp., a bank holding company. The instant merger, however, would merely combine an existing bank with a non-operating institution; as such, and without regard to the acquisition of the surviving bank by National Bancshares Corp., it would have no effect on competition. 169 ///. Additional Approvals A. Approved, but abandoned, no litigation THE FIRST NATIONAL BANK OF PARIS, PARIS, TEX., AND NEW NATIONAL BANK OF PARIS, PARIS, TEX. Banking offices Total assets Name of bank and type of transaction In operation The First National Bank of Paris, Paris, Tex. (3638), with and New National Bank of Paris, Paris, Tex. (3638), which had applied for permission to merge Oct. 24, 1973, under charter of the latter bank (3638) and title "The First National Bank of Paris." The application was approved Jan. 15, 1974, but was abandoned by the banks May 8, 1974 COMPTROLLER S DECISION On October 24, 1973, New National Bank of Paris (organizing), Paris, Tex., and First National Bank of Paris, Paris, Tex., applied to the Comptroller of the Currency for permission to merge under the charter of the former and with the title of the latter. First National Bank of Paris, the existing bank, was organized in 1886 and has operated since that time as a unit institution pursuant to State law. The bank now has deposits of $32 million. The service area of the bank consists of the whole of Lamar County, which has an estimated population of 36,062 persons. First National Bank of Paris is the largest of the five banks headquartered in Lamar County. Principal competitors for the bank include Liberty National Bank, Paris, with deposits of $26 million, and Citizens State Bank, Paris, with deposits of $13.6 million. Additional competition is provided by The First National Bank, Deport, with deposits of $4.1 million, and First National Bank, Roxton, with deposits of $1.1 million. New National Bank of Paris, the new bank, is being organized to provide a vehicle by which to transfer ownership of First National Bank of Paris to First City Bancorporation of Texas, Inc. The new bank will not be operating as a commercial bank prior to this merger. First City Bancorporation of Texas, Inc., the bank holding company which will acquire the resulting bank, is the second largest bank holding company in Texas and controls 25 banks with aggregate deposits of $2.3 billion. The applicant's principal subsidiary is First City National Bank of Houston, Houston, Tex., with deposits of $1.5 billion. 170 $36,766,293 0 To be operated 1 0 There is minimal competition between First City Bancorporation of Texas, Inc., or its subsidiaries and First National Bank of Paris because large distances separate their closest two offices and an adequate number of alternative banking facilities operate in the intervening area. The nearest office of a subsidiary of the applicant is approximately 104 miles from Paris in Dallas, Tex. Consummation of the proposed merger will stimulate competition in Lamar County because the resulting subsidiary will be able to offer new and improved services including greater depth and expertise of management, an extensive business development program, a broader loan policy, a larger trust department, expanded credit investigation services, real estate loan and appraisal services, and international banking services. The acquisition of the resulting bank by First City Bancorporation of Texas, Inc., will result in modernization of operational procedures which should be reflected in increased profits for that bank. Applying the statutory criteria, it is concluded that the proposed merger is in the public interest, and this application is, therefore, approved. JANUARY 15, 1974. SUMMARY OF REPORT BY ATTORNEY GENERAL The proposed merger is part of a plan through which The First National Bank of Paris would become a subsidiary of First City Bancorporation of Texas, Inc., a bank holding company. The instant merger, however, would merely combine an existing bank with a non-operating institution; as such, and without regard to the acquisition of the surviving bank by First City Bancorporation of Texas, Inc., it would have no effect on competition. THE FIRST NATIONAL BANK OF SAN ANGELO, SAN ANGELO, TEX., AND NEW NATIONAL BANK, SAN ANGELO, TEX. Banking offices Total assets Name of bank and type of transaction In operation The First National Bank of San Angelo, San Angelo, Tex. (2767), with and New National Bank, San Angelo, Tex. (2767), which had applied for permission to merge Oct. 30, 1973, under charter of the latter bank (2767) and title "The First National Bank of San Angelo." The application was approved Jan. 10, 1974, but was abandoned by the banks May 8, 1974 COMPTROLLER'S DECISION On October 30, 1973, New National Bank (organizing), San Angelo, Tex., and The First National Bank of San Angelo, San Angelo, Tex., applied to the Comptroller of the Currency for permission to merge under the charter of the former and with the title of the latter. The First National Bank of San Angelo, the existing bank, was organized in 1882 and now has deposits of $50.5 million. The service area of the bank consists of the whole of Tom Green County which has an estimated population of 71,047 persons. The First National Bank of San Angelo is the third largest of five banks headquartered in its service area. Competition for the bank is provided by San Angelo National Bank, with deposits of $82.2 million, which is a subsidiary of Texas Commerce Bancshares, Inc., Houston, the State's third largest multi-bank holding company; The Central National Bank of San Angelo, with deposits of $72 million; West Side National Bank of San Angelo, with deposits of $12.9 million; and Texas State Bank, San Angelo, with deposits of $11.3 million. New National Bank, the new bank, is being organized to provide a vehicle by which to transfer ownership of The First National Bank of San Angelo to First City Bancorporation of Texas, Inc. The new bank will not be operating as a commercial bank prior to this merger. First City Bancorporation of Texas, Inc., the bank holding company which will acquire the resulting bank, is the second largest bank holding company in Texas and controls 25 banks with aggregate deposits of $2.3 billion. The applicant's principal subsidiary is First City National Bank of Houston, Houston, Tex., with deposits of $1.5 billion. $59,245,185 0 To be operated 1 0 There is minimal competition between First City Bancorporation of Texas, Inc., or its subsidiaries and The First National Bank of San Angelo, because large distances separate their closest two offices and an adequate number of alternative banking facilities operate in the intervening area. The nearest office of a subsidiary of the applicant is approximately 110 miles from San Angelo in Midland, Tex. Consummation of the proposed merger will stimulate competition in Tom Green County because the resulting subsidiary will be able to offer new and improved services including greater depth and experience of management, an extensive business development program, a broader loan policy, a larger trust department, expanded credit investigation services, real estate loan and appraisal services, and international banking services. The acquisition of the resulting bank by First City Bancorporation of Texas, Inc., will also help to alleviate a strained capital situation at The First National Bank of San Angelo. Applying the statutory criteria, it is concluded that the proposed merger is in the public interest and this application is, therefore, approved. JANUARY 10, 1974. SUMMARY OF REPORT BY ATTORNEY GENERAL The proposed merger is part of a plan through which The First National Bank of San Angelo would become a subsidiary of First City Bancorporation of Texas, Inc., a bank holding company. The instant merger, however, would merely combine an existing bank with a non-operating institution; as such, and without regard to the acquisition of the surviving bank by First City Bancorporation of Texas, Inc., it would have no effect on competition. 171 FIRST MISSISSIPPI NATIONAL BANK, HATTIESBURG, MISS., AND CITIZENS NATIONAL BANK, JACKSON, MISS. Banking offices Total assets Name of bank and type of transaction In operation $161,540,607 Citizens National Bank, Jackson, Miss. (15516), with 38,404,720 and First Mississippi National Bank, Hattiesburg, Miss. (5176), which had applied for permission to merge Aug. 5, 1974, under charter and title of the latter bank (5176). The application was approved Sept. 24, 1974, but was abandoned by the banks Nov. 12, 1974 COMPTROLLER S DECISION On August 5, 1974, Citizens National Bank, Jackson, Miss., and First Mississippi National Bank, Hattiesburg, Miss., applied to the Comptroller of the Currency for permission to merge under the charter and the title of the latter. First Mississippi National Bank, the charter bank, was organized in 1899, and now has assets of $166.2 million and IPC deposits of $111.2 million. It operates 19 branch offices to serve those parts of Forrest, Harrison, Jackson, Jefferson Davis, Lamar, and Rankin counties within 100 miles of Hattiesburg. The economy of that area is diversified, with manufacturing, seafood processing and agriculture. The charter bank is the largest of the three banks headquartered in Hattiesburg. The other two are Citizens Bank of Hattiesburg, with $31.7 million in deposits, and Southern National Bank of Hattiesburg, with deposits of $21.9 million. The service area is also served by 24 other banking offices with aggregate deposits of $1.8 billion. Citizens National Bank, the merging bank, with assets of $51.1 million and IPC deposits of $24.7 million operates six branches. It is the smallest of the four banks headquartered in Jackson with competition provided by the $645.7 million deposit Deposit Guaranty National Bank, the $591.6 million deposit First National Bank of Jackson and the $60.9 million deposit Mississippi Bank and Trust Company. Jackson is the financial, commercial, and industrial center of Mississippi. There is little competition between the charter and merging banks because of the distance separating their service areas. First Mississippi National Bank recently opened a de novo branch in Pearl, within the service area of Citizens National Bank, but that branch only held deposits as of June 30, 1974. Consummation of the proposed merger will have no adverse effect on competition. The resulting bank 172 To be operated 7 18 will be in a better position to compete effectively in the Jackson area, which the merging bank is presently unable to do because of management problems and the small size of the bank. The two largest banks have dominated the financial field in Jackson and the proposed merger will give potential customers a viable third choice. Applying the statutory criteria, it is concluded that the proposed merger is in the public interest and this application is, therefore, approved. SEPTEMBER 24, 1974. SUMMARY OF REPORT BY ATTORNEY GENERAL Applicant operates one branch office in close proximity to Bank's main and branch offices. That office, located in the Jackson SMSA in the community of Pearl, Rankin County, was opened in April 1974, and currently holds total deposits of less than $1 million. Applicant's other offices are located 60 or more miles south of Bank's service area. The Jackson Mississippi banking market is highly concentrated, with the State's two largest banks eontrolling approximately 85 percent of total deposits in the Jackson SMSA. Bank, with approximately 3.6 percent of SMSA deposits ranks fourth, while Applicant's single office ranks 13th in the Jackson SMSA with less than 1 percent of total deposits. Thus, while the proposed merger may eliminate some existing competition and the potential for increased competition between the parties in the Jackson area, concentration in commercial banking in that market would not be substantially increased. And in view of the relatively modest market position of Bank in the Jackson market, it does not appear that the proposed merger would eliminate substantial potential competition. Therefore, we conclude that the proposed transaction would not have significantly adverse competitive effects. B. Approved, but abandoned, due to litigation THE MERCHANTS NATIONAL BANK OF BURLINGTON, BURLINGTON, V T . , AND MONTPELIER NATIONAL BANK, MONTPELIER, VT. Banking offices Name of bank and type of transaction Total assets In operation Montpelier National Bank, Montpelier, Vt. (13915), with and The Merchants National Bank of Burlington, Burlington, Vt. (1197), which had applied for permission to merge June 29, 1973, under charter of the latter bank (1197) and title "The Merchants National Bank of Burlington, Vermont." The application was approved Nov. 1, 1973. The pending merger was challenged by Justice Department Nov. 29, 1973, and was abandoned by the banks July 9, 1974 $35,738,000 64,638,000 To be operated 2 7 The "Comptroller's Decision" and "Summary of Report by Attorney General" for this case appeared in the 1973 Annual Report under the heading "Approved, but in litigation." * * * THE CONNECTICUT NATIONAL BANK, BRIDGEPORT, CONN., AND THE FIRST NEW HAVEN NATIONAL BANK, N E W HAVEN, CONN. Banking offices Total assets Name of bank and type of transaction In operation $398,313,449 315,269,949 The Connecticut National Bank, Bridgeport, Conn. (335), with and The First New Haven National Bank, New Haven, Conn. (2), which had applied for permission to consolidate Feb. 2, 1971, under charter of the latter bank (2) and title "The First Connecticut National Bank." The application was approved July 26, 1971. The pending consolidation was challenged by Justice Department Aug. 23, 1971, and was abandoned by the banks Aug. 22, 1974 To be operated 51 21 The "Comptroller's Decision" and "Summary of Report by Attorney General" for this case appeared in the 1971 Annual Report under the heading "Approved, but in litigation." * * * THE NATIONAL BANK OF COMMERCE OF SEATTLE, SEATTLE, WASH., AND WASHINGTON TRUST BANK, SPOKANE, WASH. Banking offices Name of bank and type of transaction Total assets In operation Washington Trust Bank, Spokane, Wash., with and The National Bank of Commerce of Seattle, Seattle, Wash. (4375), which had applied for permission to merge Mar. 9, 1971, under charter and title of the latter bank (4375). The application was approved Sept. 24, 1971. The pending merger was challenged by Justice Department Oct. 21, 1971, and was abandoned by the banks Oct. 3, 1974 $ 102,633,000 1,320,714,000 To be operated 1 106 The "Comptroller's Decision" and "Summary of Report by Attorney General" for this case appeared in the 1971 Annual Report under the heading "Approved, but in litigation." * * * 173 APPENDIX B Statistical Tables Statistical Tables Table No. B-l B-2 B-3 B-4 Title Page Comptrollers of the Currency, 1863 to the present 177 Deputy Comptrollers of the Currency 178 Regional Administrators of National banks 178 Changes in the structure of the National Banking System, by States, 1863-1974 179 B-5 Charters, liquidations, and changes in issued capital stock of National banks, calendar 1974 180 B-6 Applications for National bank charters, approved and rejected, by States, calendar 1974 181 B-7 Applications for National bank charters, by States, pursuant to corporate reorganizations, calendar 1974 183 B-8 Newly organized National banks, by States, calendar 1974 184 B-9 National bank charters issued and mergers consummated pursuant to corporate reorganizations, by States, calendar 1974 187 B-10 State-chartered banks converted to National banks, by States, calendar 1974 192 B - l l National bank charters issued pursuant to corporate reorganizations, by States, calendar 1974.. 193 B-12 National banks reported in voluntary liquidation, by States, calendar 1974 194 B-13 National banks merged or consolidated with State banks, by States, calendar 1974 195 B-14 National banks converted into State banks, by States, calendar 1974 196 B-15 Purchases of State banks by National banks, by States, calendar 1974 197 B-16 Consolidations of National banks, or National and State banks, by States, calendar 1974 198 B-17 Mergers of National banks, or National and State banks, by States, calendar 1974 199 B-18 Mergers resulting in National banks, by assets of acquiring and acquired banks, 1960-1974 202 B-19 Domestic branches entering the National Banking System, by de novo opening, merger, or conversion, by States, calendar 1974 202 B-20 Domestic branches of National banks closed, by States, calendar 1974 214 B—21 Principal assets, liabilities, and capital accounts of National banks, by deposit size, year-end 1973 and 1974 216 B-22 Dates of reports of condition of National banks, 1914-1974 217 176 Table No. Title Total and principal assets of National banks, by States, June 30, 1974 Total and principal liabilities of National banks, by B-24 States, June 30, 1974 Capital accounts of National banks, by States, June B-25 30, 1974 Total and principal assets of National banks, by B-26 States, Dec. 31, 1974 Total and principal liabilities of National banks, by B-27 States, Dec. 31, 1974 Capital accounts of National banks, by States, Dec. B-28 31, 1974 B-29 Loans of National banks, by States, Dec. 31, 1974 B-30 Outstanding balances, credit cards and related plans of National banks, Dec. 31, 1974 B-31 National banks engaged in direct lease financing, Dec. 31, 1974 B-32 Income and expenses of National banks, by States, year ended Dec. 31, 1974 B-33 Income and expenses of National banks, by deposit size, year ended Dec. 31, 1974 B-34 Capital accounts, net income, and dividends of National banks, 1944-1974 B-35 Loan losses and recoveries of National banks, 1945-1974 B-36 Securities losses and recoveries of National banks, 1945-1974 Ratios of classified assets to total loans for National banks, deposit size category under $100 million B-38 Ratios of classified assets to total loans for National banks, deposit size category $100 million and over B-n39 Assets and liabilities of National banks, date of last report of condition, 1950-1974 B-40 Foreign branches of National banks, by region and country, Dec. 31, 1974 B-41 Total assets of foreign branches of National banks, year-end 1953-1974 B-42 Foreign branches of National banks, 1960-1974 . . B—43 Assets and liabilities of foreign branches of National banks, Dec. 31, 1974: consolidated statement Trust assets and income of National banks, by States, calendar 1974 B-23 Page 219 220 221 222 223 224 225 226 227 228 242 244 245 245 246 246 247 248 249 249 249 250 TABLE B-l Comptrollers of the Currency, 1863 to the present No. 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 Name McCulloch, Hugh Clarke, Freeman Hulburd, Hiland R . . . Knox, John Jay Cannon, Henry W Trenholm, William L ., Lacey, Edward S Hepburn, A. Barton . . , Eckels, James H Dawes, Charles G Ridgely, William Barret Murray, Lawrence O . Williams, John Skelton, Crissinger, D. R Dawes, Henry M Mclntosh, Joseph W . . , Pole, John W O'Connor, J. F. T Delano, Preston Gidney, Ray M Saxon, James J Camp, William B Smith, James E Date of appointment May Mar. Feb. Apr. May Apr. May Aug. Apr. Jan. Oct. Apr. Feb. Mar. May Dec. Nov. May Oct. Apr. Nov. Nov. July 9, 21, 1, 25, 12, 20, 1, 2, 26, 1, 1, 27, 2, 17, 1, 20, 21, 11, 24, 16, 16, 16, 5, 1863 1865 1867 1872 1884 1886 1889 1892 1893 1898 1901 1908 1914 1921 1923 1924 1928 1933 1938 1953 1961 1966 1973 Date of resignation Mar. 8, July 24, Apr. 3, Apr. 30, Mar. 1, Apr. 30, June 30, Apr. 25, Dec. 31, Sept. 30, Mar. 28, Apr. 27, Mar. 2, Apr. 30, Dec. 17, Nov. 20, Sept. 20, Apr. 16, Feb. 15, Nov. 15, Nov. 15, Mar. 23, 1865 1866 1872 1884 1886 1889 1892 1893 1897 1901 1908 1913 1921 1923 1924 1928 1932 1938 1953 1961 1966 1973 State Indiana. New York. Ohio. Minnesota. Minnesota. South Carolina. Michigan. New York. Illinois. Illinois. Illinois. New York. Virginia. Ohio. Illinois. Illinois. Ohio. California. Massachusetts. Ohio. Illinois. Texas. South Dakota. 177 TABLE B-2 Deputy Comptrollers of the Currency No. Dates of tenure Name 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 May 9, 1863 Aug. 1, 1865 Mar. 12, 1867 Aug. 8, 1872 Jan. 5, 1886 Jan. 27, 1887 Aug. 11, 1890 Apr. 7, 1893 Mar. 12, 1 8 % Sept. 1, 1898 June 29, 1899 July 1, 1908 May 21, 1923 July 1, 1923 Jan. 6, 1925 July 1, 1927 July 6, 1927 __.. 1,1928 Dec. Jan. 24, 1933 Feb. 24, 1936 Jan. 16, 1938 Jan. 16, 1938 Oct. 1, 1938 May 1, 1939 July 7, 1941 Sept. 1, 1941 Oct. 1, 1944 Jan. 1, 1949 Sept. 1, 1950 Mar. 1, 1951 Feb. 18, 1952 Sept. 15, 1959 May 16, 1960 Apr. 2, 1962 Aug. 4, 1962 Sept. 3, 1962 Dec. 23, 1962 Jan. 1, 1963 July 13, 1964 Sept. 1, 1964 Sept. 1, 1964 July 19, 1965 July 1, 1966 Feb. 21, 1967 July 5, 1973 July 5, 1973 Feb. 2, 1975 Howard, Samuel T . . . Hulburd, Hiland R . . . Knox, John Jay Langworthy, John S .. Snyder, V. P Abrahams, J. D Nixon, R. M Tucker, Oliver P Coffin, George M Murray, Lawrence O . Kane, Thomas P Fowler, Willis J Mclntosh, Joseph W .. Collins, Charles W . . . Stearns, E. W Await, F. G Gough, E. H Proctor, John L Lyons, Gibbs Prentiss, Jr., William . Diggs, Marshall R Oppegard, G. J Upham, C. B Mulroney, A. J McCandless, R. B . . . . Sedlacek, L. H Robertson, J. L Hudspeth, j . W Jennings, L. A Taylor, W. M Garwood, G. W Fleming, Chapman C . Haggard, Holus S Camp, William B Redman, Clarence B . . Watson, Justin T Miller, Dean E DeShazo, Thomas G .. Egertson, R. Coleman Blanc hard, Richard J . Park, Radcliffe . . . . . . . Faulstich, Albert J . . . . Motter, David C Gwin, John D Howland, Jr., W. A . . . Mullin, Robert A Ream, Joseph M State Aug. 1, 1865 Jan. 31, 1867 Apr. 24, 1872 Jan. 3, 1886 Jan. 3, 1887 May 25, 1890 Mar. 16, 1893 Mar. 11, 1896 Aug. 31, 1898 June 27, 1899 Mar. 2, 1923 Feb. 14, 1927 Dec. 19, 1924 June 30, 1927 Nov. 30, 1928 Feb. 15, 1936 Oct. 16, 1941 Jan. 23, 1933 Jan. 15, 1938 Jan. 15, 1938 Sept. 30, 1938 Sept. 30, 1938 Dec. 31, 1948 Aug. 31, 1941 Mar. 1, 1951 Sept. 30, 1944 Feb. 17, 1952 Aug. 31, 1950 May 16, 1960 Apr. 1, 1962 Dec. 31, 1962 Aug. 31, 1962 Aug. 3, 1962 Nov. 15, 1966 Oct. 26, 1963 New York. Ohio. Minnesota. New York. New York. Virginia. Indiana. Kentucky. South Carolina. New York. Dist. of Columbia. Indiana. Illinois. Illinois. Virginia. Maryland. Indiana. Washington. Georgia. California. Texas. California. Iowa. Iowa. Iowa. Nebraska. Nebraska. Texas. New York. Virginia. Colorado. Ohio. Missouri. Texas. Connecticut. Ohio. Iowa. Virginia. June 30, 1966 Iowa. Massachusetts. June 1, 1967 Wisconsin. Oct. 26, 1974 Louisiana. Ohio. Mississippi. Georgia. Kansas. Pennsylvania. TABLE B-3 Regional Administrators of National banks Region Name Headquarters 1 Charles H. Paterson . . . . . . . . . Boston, Mass 2 Charles M. Van Horn 3 4 R. Coleman Egertson Larry T. Gerzema 5 John G. Hensel 6 7 8 9 10 11 12 13 14 178 Billy C. Wood Charles B. Hall John W. Schaffer, Jr Donald B. Smith John R. Burt Michael Doman John R. Thomas M. B. Adams H. Joe Selby . . . . New York, N.Y : Philadelphia, Pa Cleveland, Ohio Richmond, Va Atlanta, Ga Chicago, 111 Memphis, Tenn Minneapolis, Minn Kansas City, Mo Dallas, Tex Denver, Colo Portland, Oreg San Francisco, Calif States Connecticut, Maine, Massachusetts, New Hampshire, Rhode island, Vermont. New Jersey, New York, Puerto Rico, Virgin Islands. Pennsylvania, Delaware. Indiana, Kentucky, Ohio. District of Columbia, Maryland, North Carolina, Virginia, West Virginia. Florida, Georgia, South Carolina. Illinois, Michigan. Alabama, Arkansas, Louisiana, Mississippi, Tennessee. Minnesota, North Dakota, South Dakota, Wisconsin. Iowa, Kansas, Missouri, Nebraska. Oklahoma, Texas. Arizona, Colorado, New Mexico, Utah, Wyoming. Alaska, Idaho, Montana, Oregon, Washington. California, Guam, Hawaii, Nevada. TABLE B-4 Changes in the structure of the National Banking System, by States, 1863-1974 Organized and opened for business 1863— 1974 Consolidated and merged under 12 U.S.C. 215 12 U.S.C. 214 Insol- Liquidated Merged or Converted to consolidated State banks with State banks Merged Consolidated United States 16,423 727 802 2,825 6,761 243 357 Alabama Alaska , Arizona , Arkansas California , Colorado Connecticut Delaware District of Columbia 229 8 33 172 619 283 141 32 41 371 4 0 1 21 5 11 0 8 2 23 0 0 3 55 4 9 0 0 2 45 0 6 39 67 58 7 1 7 43 64 2 21 55 397 86 69 18 13 42 0 0 1 0 4 3 5 0 0 0 0 1 1 0 20 0 16 8 0 0 214 8 113 1,000 455 568 463 250 127 131 8 1 0 20 14 4 6 11 4 8 4 0 2 14 8 2 4 2 2 10 42 0 35 227 98 206 77 37 16 13 87 4 65 299 205 243 198 110 53 79 9 1 2 18 5 12 7 8 0 0 0 0 3 2 4 2 0 2 0 1 159 398 396 523 104 346 212 416 18 91 3 44 11 8 6 13 4 2 1 4 18 25 28 0 4 12 1 3 0 11 17 28 77 116 16 58 76 83 4 5 69 208 157 193 36 148 76 199 8 23 1 1 1 4 3 4 0 8 0 1 11 14 5 0 0 1 0 0 1 0 502 98 1,062 168 264 746 788 154 1,301 70 56 1 127 8 3 33 12 2 112 3 82 1 113 23 0 40 9 4 117 2 60 25 131 44 100 112 85 31 211 2 154 37 442 58 118 336 454 103 495 58 1 0 13 0 0 2 35 0 14 0 27 0 82 9 0 6 0 6 102 0 138 224 238 1,447 51 85 307 248 217 309 82 1 2 8 14 9 45 4 3 23 19 11 9 0 0 0 14 3 14 56 2 7 58 10 0 1 0 0 0 43 93 36 142 6 17 28 51 38 54 12 0 0 49 81 94 574 23 29 74 144 68 116 26 0 1 2 2 8 57 3 3 4 0 0 1 0 0 0 4 0 2 4 2 9 11 1 0 0 0 0 0 Florida Georgia Hawaii Idaho Illinois Indiana Iowa Kansas Kentucky Louisiana Maine Maryland Massachusetts Michigan Minnesota Mississippi Missouri Montana Nebraska Nevada New Hampshire New Jersey New Mexico New York North Carolina . North Dakota Ohio Oklahoma Oregon Pennsylvania Rhode Island South Carolina . South Dakota Tennessee Texas Utah Vermont Virginia Washington West Virginia Wisconsin Wyoming Virgin Island Puerto Rico , , , , , , , 1 In operation Dec. 31, 1974 179 TABLE B-5 Charters, liquidations, and changes in issued capital stock of National banks, calendar 1974 Capital stock Number of banks Increases: Banks newly chartered: Primary organization Conversion of State banks Capital stock: Preferred: 1 case by new issue Common: 545 cases by statutory sale 602 cases by statutory stock dividends 5 cases by statutory consolidation 29 cases by statutory merger 15 cases by conversion of preferred stock 32 cases by conversion of capital notes Capital notes and debentures: 111 cases by new issue .. Total increases Decreases: Banks ceasing operations: Voluntary liquidations: Succeeded by National banks Succeeded by State banks Statutory consolidations Statutory mergers Converted into State banks Merged or consolidated into State banks Insolvent Capital stock: Preferred: 32 Retired Common: 7 cases by statutory reduction 2 cases by statutory consolidation 6 cases by statutory merger Capital notes and debentures: 44 retirements 32 converted to common stock 152* 12 Common $ Preferred 66,310,125 99,933,100 Capital notes and debentures $ 95,755,000 $ 1,000,800 128,273,898 194,944,347 6,245,850 22,459,091 1,270,478 1,142,319 108,767,360 164 520,579,208 5 1 3 1,400,405 200,000 1,000,000 45,703,335 9,062,140 39,323,320 14,060,000 83t 19 13 1 1,000,800 17,711,900 204,522,360 28,500,000 3,085,760 1,787,998 599,825 2,380,140 42,557,984 4,025,560 125 100,457,163 20,797,660 90,143,544 +39 Total decreases Net change Charters in force Dec. 31, 1973, and issued capital 4,669 420,122,045 7,914,886,509 -19,796,860 33,189,560 114,378,816 2,378,059,050 Charters in force Dec. 31, 1974, and issued capital 4,708 8,335,008,554 13,392,700 2,492,437,866 * Includes 60 reorganized banks with capital stock of $7,524,000. t Includes 61 reorganized banks. NOTE: Premium on sale of common stock Premium on sale of convertible notes Total 180 $209,147,454 (533 cases) $ 2,883,246 ( 32 cases) $212,030,700 (565 cases) TABLE B-6 Applications for National bank charters, approved and rejected, by States, calendar 1974 ALABAMA Southern National Bank, Birmingham Chatom Tallassee Approved Rejected Oct. 17 Nov. 13 July 9 ALASKA Security National Bank, Anchorage July 1 ARKANSAS North Little Rock June 10 CALIFORNIA Los Angeles Los Angeles Oxnard Capistrano Valley National Bank, San Juan Capistrano San Leandro South Coast National Bank, Santa Ana . . . . El Capitan National Bank, Sonora Azteca National Bank, Stockton Mar. 25 Mar. 30 Dec. 31 Mar. 25 June Oct. Mar. 8 30 25 July 12 GEORGIA COLORADO Mountain National Bank of Aurora, Aurora Gunbarrel National Bank, Unincorporated area of Boulder County Castle Rock National Bank, Castle Rock .. Craig United Bank of Monaco National Association, Denver Boca Raton Boca Raton Coastal National Bank, Boynton Beach Charlotte Harbor Coral Springs National Bank, Coral Springs Citizens First National Bank of Crystal River, Crystal River First American National Bank of Dania, Dania City National Bank of South Dade, Unincorporated area of South Dade Pan American Bank of Kendale Lakes, National Association, Unincorporated area of Dade County Southeast National Bank of North Dade, Unincorporated area of Dade County . . . . Deerfield Beach First National Bank of Destin, Destin East Naples Fort Myers Fort Pierce Hialeah Jacksonville Jacksonville Barnett Bank Trust Company, National Association, Jacksonville Century National Bank, Jacksonville Jupiter-Tequesta National Bank, Jupiter . . . Second National Bank of Lakeland, Lakeland Southern National Bank of Palm Beach County, Florida, Lake Worth Unincorporated area of Lee County Unincorporated area of Lee County Unincorporated area of Martin County Marco Island Southeast Banks Trust Company, National Association, Miami Okeechobee Unincorporated area of Orange County Orlando Pembroke Pines Unincorporated Area of Pinellas County Jan. 26 June Mar. 8 30 Approved Rejected Mar. 25 Aug. 25 Jan. 27 Dec. 31 Sewall's Point National Bank, Sewall's Point Jan. 27 Southeast National Bank of Sweetwater, Sweetwater Mar. 25 Stuart Jan. 27 Tamarac Jan. 26 Tampa Jan. 16 Citizens National Bank, Tampa Jan. 16 Islands National Bank, Tampa Jan. 16 Landmark National Bank of Tarpon Springs, Tarpon Springs Jan. 27 Venice Oct. 30 Vero Beach National Bank, Vero Beach . . . Aug. 25 Flagler National Bank of the Palm Beaches, West Palm Beach Feb. 7 West Palm Beach Feb. " 7 FLORIDA—Continued Punta Gorda St. Cloud St. Petersburg Sanford The First National Bank of Chatsworth, Chatsworth Mar. Clayton First National Bank of Douglasville, Douglasville Jan. Jan. 27 Mar. 30 Mar. 30 Jan. 26 Mar. 30 Jan. 27 Nov. 13 Jan*. 26 Nov. 13 Mar. 25 June 10 Mar. Dec. 30 Aug. 22 July 27 Feb. 9 Jan. 26 June 10 Jan. 26 Jan. 26 Jan. 27 June 8 June 8 June 8 Jan. Mar. Aug. 27 25 25 June 10 July 12 Feb.* 9 Harbor National Bank, Baltimore . . . . County National Bank, Bethesda Fidelity National Bank, Cockeysville ., St. Charles Mar. Apr. Dec. 4 13 3 23 Mar. 25 Jan. National Bank of Dearborn, Dearborn First National Bank of Plymouth, Plymouth June Michigan National Bank of Macomb, Warren Sept. 26 8 28 MINNESOTA Burnsville National City Bank of Burnsville, Burnsville July July 27 27 MISSISSIPPI Jan. Jan. Dec. Jan. July Buffalo Grove National Bank, Buffalo Grove Chicago Washington National Bank of Chicago, Chicago Galesburg First National Bank of Lake Zurich, Lake Zurich First National Bank of Marengo, Marengo.. Northbrook National Bank, Northbrook North Riverside Butterfield National Bank, Wheaton First National Bank of Wonder Lake, Wonder Lake MARYLAND 12 25 25 27 27 ILLINOIS First National Bank of St. Charles Parish, Boutte April Mar. Sept. July Nov.'i3 LOUISIANA Aug. Jan. 30 26 26 12 27 27 Jan. 27 Aug. 6 Dec. 31 Mar. 30 June 8 Dec. 31 Mar. 30 Mar. 30 Brookhaven . Starkville . . . Tylertown .. MISSOURI First National Bank of Arnold, Arnold Kansas City Mar. 25 Jan. 27 NEBRASKA Old Mill National Bank, Unincorporated area of Douglas County June 8 181 TABLE B-6—Continued Applications for National bank charters, approved and rejected, by States, calendar 1974 NEW JERSEY Barnegat Bay National Bank, Brick Princeton American National Bank, Dover Evesham The Montgomery National Bank, Township of Montgomery Lenape National Bank, Moorestown Wildwood Approved May Jan. 15 26 Jan. 27 Dec. Mar. 31 1 Jan. 2 NEW MEXICO Alamogordo Plaza Del Sol National Bank, Albuquerque Jan. Southeast National Bank, Albuquerque . . . . June Deming San Juan National Bank, Farmington Dec. Los Lunas Silver City Oct. 30 26 10 Oct. 30 12 Mar. 30 July 27 NEW YORK Capital National Bank of New York, New York June Alliance National Bank, New York Mar. July 2 OKLAHOMA 30 PUERTO RICO Rio Grande Oct. 30 SOUTH CAROLINA Republic National Bank, Columbia Mar. Hilton Head National Bank, Hilton Head Island Apr. 30 19 TENNESSEE 15 TEXAS 182 8 8 8 8 June 8 June 8 July Apr. Apr. May 27 27 27 15 Mar. 25 Mar. 25 Mar. 30 Mar. 30 Mar. 30 Dec. 30 July 8 VIRGINIA Bassett First & Merchants National Bank of Fairfax, Unincorporated area of Fairfax County . . Gloucester First & Merchants National Bank of Loudoun, Leesburg Martinsville First & Merchants National Bank of Prince William, Unincorporated area of Prince William County The First National Bank of Rocky Mount, Rocky Mount June 8 Mar. 25 Aug. 19 Mar. 30 June 8 June 10 Mar. 30 Ben Franklin National Bank, Pasco June Jefferson National Bank, Port Townsend .. . Jan. 10 12 WASHINGTON Third National Bank in Memphis, Memphis May Alpine Austin Austin Austin Austin National Bank of Commerce, Austin United National Bank, Dallas National Bank of Commerce, Edinburg El Paso First International Bank in El Paso, National Association, El Paso West Ten National Bank, El Paso Summit National Bank, Fort Worth June 8 June June June June Orem Richfield NORTH CAROLINA Citizens National Bank of Lawton, Lawton Mar. Houston Colonial National Bank, Houston Gulf Southern National Bank, Houston National Standard Bank, Houston Parkway National Bank, Houston League City First National Bank of League City, League City New Braunfels National Bank, New Braunfels Continental National Bank, San Antonio . . . Plaza National Bank, San Antonio South Park National Bank, San Antonio . . . Seven Points Seven Points Citizens National Bank of Temple, Temple Waxahachie Ellis National Bank, Waxahachie Approved Rejected UTAH 8 25 Rocky Mount TEXAS—Continued Rejected Aug. 23 Dec. 31 Dec. 31 Dec. 31 Dec. 31 Dec. Apr. July 31 17 25 30 30 30 31 25 WISCONSIN Ozaukee First National Bank, Cedarburg . . Aug. First National Bank of Oregon, Oregon . . . . Mar. Dec. 30 Dec. Dec. Mar. WEST VIRGINIA Gulf National Bank, Sophia Dec. First National Bank of Weston, Weston . . . . Nov. 19 30 WYOMING Wyoming National Bank of Gillette, Gillette Mar. Bank of Wyoming, National AssociationRock Springs, Rock Springs Jan. 30 26 TABLE B-7 Applications for National bank charters, by States, pursuant to corporate reorganizations, calendar 1974 ALABAMA Southland National Bank of Birmingham, Birmingham Southland National Bank of Fairhope, Fairhope Shoals Bank, N.A., Florence Bank of Gadsden, N.A., Gadsden Southland National Bank of Mobile, Mobile Bank of Phenix, N.A., Phenix City Approved Rejected Mar. 3 Mar. 5 June 27 Jan. 18 Mar. 5 May 6 ARKANSAS Jefferson National Bank, Pine Bluff Apr. 18 CALIFORNIA SN National Bank, Walnut Creek Dec. 17 ILLINOIS FoPark National Bank, Village of Forest Park Melrose National Bank, Melrose Park Second National Bank of Mount Prospect, Village of Mount Prospect Oak Brook National Bank, Village of Oak Brook HNB Bank, N.A., Pekin INB National Bank, Springfield Second National Bank of Springfield, Springfield Nov. 12 July 19 Aug. 28 Dec. Oct. Oct. 5 21 2 July 16 KENTUCKY FSNB National Bank and Trust Company, Lexington Dec. 11 MASSACHUSETTS Fall River Bank, National Association, Fall River The Ipswich Bank, National Association, Ipswich The Blackstone Valley Bank, National Association, Town of Northbridge Second National Bank of Cape Cod, Town of Orleans The Yarmouth Bank, National Association, Yarmouth June 25 Mar. 28 Apr. 18 Aug. 15 Mar. 28 MICHIGAN C National Bank, Cassoplis Sept. National Bank of Howell, Howell Jan. GNB National Bank, Iron wood May The Second National Bank of Ironwood, Ironwood May SWM National Bank, Niles Feb. 26 12 14 23 19 MISSISSIPPI Hattiesburg Bank, N.A., Hattiesburg Jan. 18 NEW JERSEY Second City National Bank of Salem, Salem Oct. 7 NEW YORK American National Bank, New York Aug. First Seaway Bank, National Association, Watertown June 6 11 OHIO Approved Rejected Mar. June Aug. Jan. May 7 28 7 5 30 Mar. May 12 24 Mercer County Interim Bank, N.A., Borough of Greenville Apr. 18 The F.B.G. National Bank of Athens, Athens The Farmers National Bank, Canfield The G. C. National Bank, Village of Chardon The C. B. National Bank of Sidney, Sidney The F. N. National Bank of Toledo, Toledo OKLAHOMA National Bank of Stillwater, Stillwater Mingo Valley National Bank, Tulsa PENNSYLVANIA TEXAS Commercial Bank National Association, Brady Johnson County National Bank, Cleburne . . Casa Linda Commerce Bank National Association, Dallas Fidelity Commerce Bank National Association, Dallas Mercantile Bank, National Association, Dallas New Citizens National Bank of Dallas, Dallas Northwest Commerce Bank National Association, Dallas Royal Commerce Bank National Association, Dallas Village Commerce Bank National Association, Dallas Circle National Bank of Fort Worth, Fort Worth Glenbrook & Avenue A National Bank, Garland South Main & Richardson National Bank, Henderson Gulf Bank, National Association, Houston . First Montgomery County National Bank, Unincorporated area of Montgomery County Nassau Bank, National Association, Nassau Bay Rogers Street Bank, National Association, San Antonio Texarkana Bank, National Association, Texarkana Feb. Apr. 19 18 May 23 May 24 Mar. 5 Sept. 13 May 23 May 24 May 23 Jan. 18 June 11 June July 26 11 Nov. 19 June 11 Oct. 1 Sept. 25 VIRGINIA Colonial Bank, N.A., Unincorporated area Mar. of Roanoke County Feb. Peoples Bank, N.A., Rocky Mount Virginia National Bank/Fairfax, Springfield May 21 4 9 WEST VIRGINIA Second Bank of Warwood, National AssociaJune tion, Wheeling Second Community Savings Bank, National Association, Wheeling June 19 19 WYOMING Western National Bank at Casper, Casper July 8 183 TABLE B-8 Newly organized National banks, by States, calendar 1974 Charter No. Title and location of bank Total capital accounts $123,017,675 Total, United States: 92 banks ALABAMA 16291 Citizens National Bank of Limestone County, Athens 16285 Eastern Shore National Bank, Daphne 500,000 1,000,000 1,500,000 Total: 2 banks CALIFORNIA 1,000,000 1,500,000 1,300,000 16278 Citizen's National Bank, Hanford 16407 Far East National Bank, Los Angeles 16305 Mexican American National Bank, San Diego 3,800,000 Total: 3 banks j COLORADO 400,000 16392 Empire National Bank, Canon City CONNECTICUT 2,500,000 16290 Citizen's National Bank of Fairfield, Fairfield DISTRICT OF COLUMBIA 1,500,000 16338 Hemisphere National Bank, Washington FLORIDA 16415 16293 16266 16321 16386 16401 16295 16367 16281 16276 16325 16399 16335 16268 16263 16292 16403 16391 16409 Broward National Bank of Boynton Beach, Boynton Beach Southern National Bank of Broward County, Unincorporated area of Broward County The National Bank of Cape Coral, Cape Coral Clewiston National Bank, Clewiston Florida Coast Bank of Coral Springs, National Association, Coral Springs Southeast National Bank of North Dade, Unincorporated area of Dade County Palmer Bank of Fort Myers, National Association, Fort Myers Barnett Banks Trust Company, National Association, Jacksonville The Exchange National Bank of Largo, Largo Palmer Bank of Bradenton, National Association, Unincorporated area of Manatee County Continental National Bank of Miami, Miami Southeast Banks Trust Company, National Association, Miami First National Bank of Moore Haven, Moore Haven Palmer Bank and Trust Company of Naples, National Association, Naples Panama City National Bank, Panama City First National Bank of Sunrise, Sunrise City National Bank, Tallahassee Landmark Bank of Tarpon Springs, National Association, Tarpon Springs Flagler National Bank of the Palm Beaches, West Palm Beach Total: 19 banks 1,250,000 1,500,000 2,000,000 1,200,000 2,000,000 1,000,000 1,500,000 2,000,000 1,000,000 1,000,000 2,000,000 4,000,000 1,000,000 1,500,000 1,000,000 1,000,000 1,500,000 1,000,000 2,000,000 29,450,000 GEORGIA 16275 Fidelity National Bank, Decatur 16280 First National Bank of Thomasville-Thomas County, Thomasville 2,500,000 1,300,000 3,800,000 Total: 2 banks ILLINOIS 16377 Lake Shore National Bank, Danville 16413 American National Bank, Village of Downers Grove 16260 Suburban National Bank of Woodfield, Village of Schaumburg 1,000,000 500,000 1,000,000 2,500,000 Total: 3 banks KANSAS 16286 First National Bank of Derby, Derby 1,000,000 LOUISIANA 16339 184 Republic National Bank of Louisiana, New Orleans 1,000,000 TABLE B-8—Continued Newly organized National banks, by States, calendar 1974 Title and location of bank Charter No. Total capital accounts MAINE 16382 Casco-Northern National Bank, Augusta $1,200,000 MARYLAND 16337 Atlantic National Bank, Ocean City 16378 16296 16274 16393 16387 National Bank of Dearborn, Dearborn Grand Rapids Bank, National Association, Grand Rapids . Michigan National Bank-West, Kalamazoo First National Bank of Plymouth, Plymouth Michigan National Bank of Macomb, Warren 1,000,000 MICHIGAN Total: 5 banks 3,000,000 2,000,250 1,500,000 1,500,175 1,500,000 9,500,425 MINNESOTA 16308 National Bank of Minnetonka, Minnetonka 1,015,000 MISSOURI 16306 16368 16351 16383 16262 16360 United Missouri Bank of Blue Springs, National Association, Blue Springs Commerce Bank of Independence, National Association, Independence United Missouri Bank of Jefferson City, National Association, Jefferson City Harvester National Bank, Unincorporated area of St. Charles County Boatmen's National Bank of North St. Louis County, Unincorporated area of St. Louis County Mercantile National Bank of St. Louis County, Unincorporated area of St. Louis County Total: 6 banks 1,000,000 1,500,000 1,000,000 1,000,000 1,000,000 1,300,000 6,800,000 NEW JERSEY 16397 Lenape National Bank, Moorestown 16267 Arcadia National Bank, Secaucus .. 1,000,000 3,352,250 Total: 2 banks 4,352,250 NEW YORK 16379 Chase Manhattan Bank of the Southern Tier (National Association), Binghamton . 16417 Bessemer Trust Company, National Association, New York City 16319 Peoples National Bank of Rockland County, Ramapo Total: 3 banks 2,000,000 2,000,000 1,500,000 5,500,000 NORTH CAROLINA 16356 Metrolina National Bank, Charlotte . 16361 Peoples National Bank, Smithfield .. 1,750,000 1,000,000 Total: 2 banks 2,750,000 OHIO 16330 The Central Trust Company of Montgomery County, National Association, Dayton 2,000,000 OKLAHOMA 16405 Quail Creek Bank, National Association, Oklahoma City 1,650,000 TENNESSEE 16307 First National Bank of Lebanon, Lebanon . 16302 City National Bank of Memphis, Memphis . Total: 2 banks 750,000 5,000,000 5,750,000 185 TABLE R-8—Continued Newly organized National banks, by States, calendar 1914 Charter No. Total capital accounts Title and location of bank TEXAS 16355 16374 16320 16304 16381 16354 16369 16329 16297 16279 16420 16340 16388 16259 16358 16408 16282 16395 16357 16343 16336 16314 16404 Union National Bank, Austin Brownsville National Bank, Brownsville Pan American National Bank of Dallas, Dallas Western National Bank, Duncanville Continental National Bank, El Paso Franklin National Bank, El Paso Montwood National Bank, El Paso Meadowbrook National Bank, Fort Worth American National Bank of Garland, Garland Plaza National Bank, IJarlingen First Professional Bank, National Association, Houston Plaza Commerce Bank, National Association, Houston West Loop National Bank, Houston Kingwoocl Commerce Bank, N.A., Humble The First National Bank in Joshua, Joshua Commercial National Bank of Longview, Longview Oak HiU National Bank, Oak Hill Richardson National Bank, Richardson , Lakeside National Bank, Rockwall Churchill National Bank, San Antonio Colonial National Bank, San Antonio Peoples National Bank of San Antonio, San Antonio Citizens National Bank of Temple, Temple , , , , $900,000 1,100,000 750,000 1,000,000 1,000,000 800,000 1,000,000 1,000,000 900,000 1,000,000 2,000,000 2,000,000 1,500,000 1,000,000 500,000 1,400,000 750,000 1,250,000 800,000 750,000 750,000 750,000 1,000,000 23,900,000 Total: 23 banks VIRGINIA 16277 16313 16402 16406 The Services National Bank, Arlington Fidelity National Bank, Unincorporated area of Halifax County First & Merchants National Bank of Prince William, Unincorporated area of Prince William County The First National Bank of Rocky Mount, Rocky Mount 2,500,000 2,000,000 1,000,000 1,200,000 6,700,000 Total: 4 banks WEST VIRGINIA 16344 First National Bank, Beckley 16385 Guyan National Bank, Unincorporated area of Cabell County 16341 South Berkeley National Bank, Inwood 600,000 500,000 450,000 1,550,000 Total: 3 banks WISCONSIN 16353 Tri City National Bank of West Allis, West Allis 1,000,000 WYOMING 16390 Wyoming National Bank of Gillette, Gillette 16365 Bank of Wyoming, National Association, Sheridan Total: 2 banks 186 500,000 400,000 900,000 TABLE B-9 National bank charters issued* and mergers consummated pursuant to corporate reorganizations, by States, calendar 1974 Effective date of merger Operating bank New bank Resulting bank Total capital accounts Total assets ALABAMA Mar. 27, 1974 Mar. 29, 1974 Apr. 30, 1974 May Aug. 31, 1974 7, 1974 Nov. 14, 1974 The Selma National Bank, Selma Selma Bank, N.A., Selma Charter issued March 27, 1974 The Selma National Bank, Selma First National Bank of Athens, Athens First Bank of Athens, N.A., Athens Charter issued March 27, 1974 First National Bank of Athens, Athens The City National Bank of Selma, Selma Dallas County National Bank, Selma Charter issued April 29, 1974 The City National Bank of Selma, Selma Baldwin National Bank of Robertsdale, Robertsdale Gulf Coast National Bank of Robertsdale, Robertsdale Charter issued May 30, 1974 Baldwin National Bank of Robertsdale, Robertsdale First City National Bank of Gadsden, Gadsden Bank of Gadsden, N.A., Gadsden Charter issued August 5, 1974 First City National Bank of Gadsden, Gadsden Phenix National Bank of Phenix City, Phenix City Bank of Phenix, N.A., Phenix City Charter issued November 13, 1974 Phenix National Bank, Phenix City $4,073,260 $39,971,271 2,402,439 32,035,189 3,539,483 38,157,630 856,335 11,289,219 2,914,679 39,873,099 1,583,546 16,306,178 7,502,679 107,077,438 755,403 14,698,104 3,026,299 40,515,126 3,325,197 51,165,708 507,746 4,086,041 6,369,755 68,134,540 8,035,702 119,487,343 75,642,361 1,051,922,932 ARKANSAS National Bank of Commerce of Pine Bluff, Pine Bluff Jefferson National Bank, Pine Bluff Charter issued December 27, 1974 Dec. 31, 1974 National Bank of Commerce of Pine Bluff, Pine Bluff COLORADO First National Bank in Aspen, Aspen Second National Bank in Aspen, Aspen Charter issued April 26, 1974 Apr. 29, 1974 First National Bank in Aspen, Aspen First National Bank in Glenwood Springs, Glenwood Springs Second National Bank in Glenwood Springs, Glenwood Springs Charter issued April 26, 1974 Apr. 29, 1974 First National Bank in Glenwood Springs, Glenwood Springs .. First National Bank in Grand Junction, Grand Junction Second National Bank in Grand Junction, Grand Junction Charter issued April 26, 1974 Apr. 29, 1974 First National Bank in Grand Junction, Grand Junction First National Bank-North, Grand Junction, Grand Junction Second National Bank-North, Grand Junction, Grand Junction Charter issued April 26, 1974 First National Bank-North, Grand Junction, Grand Junction . . . ILLINOIS Apr. 29, 1974 First National Bank & Trust Company in Alton, Alton First National Bank & Trust Company, Alton Charter issued June 26, 1974 First National Bank & Trust Company, Alton July INDIANA 1, 1974 Lafayette National Bank, Lafayette Tippecanoe National Bank, Lafayette Charter issued August 16, 1974 Lafayette National Bank, Lafayette MARYLAND Aug. 19, 1974 The First National Bank, Baltimore Charles Street National Bank, Baltimore Charter issued June 28, 1974 The First National Bank of Maryland, Baltimore July 8, 1974 See footnote at end of table. 187 TABLE B-9—Continued National bank charters issued* and mergers consummated pursuant to corporate reorganizations, by States, calendar 1974 Operating bank New bank Resulting bank Effective date of merger Total capital accounts Total assets MASSACHUSETTS The First National Bank of New Bedford, New Bedford Second National Bank of New Bedford, New Bedford Charter issued May 8, 1974 May 10, 1974 The First National Bank of New Bedford, New Bedford First Safety Fund National Bank, Fitchburg Montachusett National Bank, Fitchburg Charter issued May 30, 1974 June 4, 1974 First Safety Fund National Bank, Fitchburg The First National Bank of Easthampton, Easthampton Easthampton Bank (National Association), Easthampton Charter issued June 24, 1974 June 28, 1974 The First National Bank of Easthampton, Easthampton $6,991,238 $75,637,194 6,208,415 57,414,272 1,444,644 12,532,230 13,369,023 165,879,365 1,883,135 24,664,874 787,594 18,604,148 2,041,291 24,954,611 2,396,575 44,992,581 934,254 8,749,913 4,875,970 49,740,402 4,207,665 54,437,141 1,577,385 21,744,600 1,691,000 23,294,692 5,072,490 49,638,116 2,724,094 27,691,175 MICHIGAN Feb. 28, 1974 Mar. 8, 1974 Mar. 8, 1974 May 8, 1974 May 20, 1974 Oct. 10, 1974 Dec. 9, 1974 Dec. 9, 1974 Dec. 13, 1974 Dec. 30, 1974 National Bank and Trust Company of Ann Arbor, Ann Arbor National Bank of Ann Arbor, Ann Arbor Charter issued February 25, 1974 National Bank and Trust Company of Ann Arbor, Ann Arbor First National Bank of Lake City, Lake City LCM National Bank, Lake City Charter issued March 4, 1974 First National Bank of Lake City, Lake City National Bank of Rochester, Rochester NBR National Bank, Rochester Charter issued March 4, 1974 National Bank of Rochester, Rochester The First National Bank of Sault Ste. Marie, Sault Ste. Marie Sault National Bank, Sault Ste. Marie Charter issued May 7, 1974 The First National Bank of Sault Ste. Marie, Sault Ste. Marie The Union National Bank and Trust Company of Marquette, Marquette UNB National Bank, Marquette Charter issued May 10, 1974 The Union National Bank and Trust Company of Marquette, Marquette The First National Bank of Evart, Evart Evart Bank, N.A., Evart Charter issued October 8, 1974 The First National Bank of Evart, Evart Central Bank, National Association, Grand Rapids C. Bank, National Association, Grand Rapids Charter issued December 9, 1974 Central Bank, National Association, Grand Rapids Valley National Bank of Saginaw, Township of Saginaw V. National Bank, Township of Saginaw Charter issued December 9, 1974 Valley National Bank of Saginaw, Township of Saginaw The Gogebic National Bank of Ironwood, Ironwood GNB National Bank, Ironwood Charter issued December 12, 1974 The Gogebic National Bank, Ironwood First National Bank of Ironwood, Ironwood Second National Bank of Ironwood, Ironwood Charter issued December 23, 1974 First National Bank of Ironwood, Ironwood NEW HAMPSHIRE Concord National Bank, Concord The Concord Bank, National Association, Concord Charter issued April 26, 1974 Apr. 30, 1974 Concord National Bank, Concord Laconia Peoples National Bank & Trust Company, Laconia The Laconia Bank, National Association, Laconia Charter issued April 26, 1974 Apr. 30, 1974 Laconia Peoples National Bank & Trust Company, Laconia See footnote at end of table. 188 TABLE B-9—Continued National bank charters issued* and mergers consummated pursuant to corporate reorganizations, by States, calendar 1974 Effective date of merger Operating bank New bank Resulting bank Total capital accounts Total assets NEW HAMPSHIRE—Continued Merchants National Bank of Manchester, Manchester The Merchants Bank, National Association, Manchester Charter issued April 26, 1974 Apr. 30, 1974 Merchants National Bank of Manchester, Manchester $6,127,279 $48,722,913 2,444,365 22,791,440 25,105,699 319,943,314 3,032,884 42,146,786 20,716,456 203,094,663 1,840,100 28,119,943 1,399,853 19,293,986 1,676,401 15,878,306 1,089,489 14,164,799 1,278,281 17,485,364 4,439,505 60,043,372 89,178,311 1,147,601,909 4,777,445 47,767,192 3,725,488 48,629,073 NEW JERSEY May 31, 1974 June 28, 1974 June 30, 1974 Aug. 1, 1974 Aug. 30, 1974 Delaware Valley National Bank, Cherry Hill New Jersey National Bank-South, Township of Cherry Hill Charter issued May 22, 1974 New Jersey National Bank-Delaware Valley, Cherry Hill Colonial First National Bank, Borough of Red Bank New Colonial First National Bank, Borough of Red Bank Charter issued June 25, 1974 Colonial First National Bank, Borough of Red Bank The First National Bank of Cranbury, Cranbury Midlantic National Bank/Cranbury, Township of Cranbury Charter issued June 25, 1974 The First National Bank of Cranbury, Cranbury The Prospect Park National Bank, Township of Wayne First Prospect Park National Bank, Township of Wayne Charter issued July 24, 1974 The Prospect Park National Bank, Township of Wayne Plaza National Bank, Secaucus Second Plaza National Bank, Secaucus Charter issued August 28, 1974 Plaza National Bank, Secaucus NEW YORK Feb. 4, 1974 Feb. 28, 1974 Mar. 29, 1974 June 28, 1974 The Homer National Bank, Homer Homer Bank, N.A., Homer Charter issued January 31, 1974 The Homer National Bank, Homer The First National Bank of Canton, Canton Chase Manhattan Bank of Northern New York (National Association), Canton Charter issued February 26, 1974 Chase Manhattan Bank of Northern New York (National Association), Canton The First National Bank of Hancock, Hancock Hancock National Bank, Hancock Charter issued March 25, 1974 The First National Bank of Hancock, Hancock Glen National Bank and Trust Company, Watkins Glen Bank of Watkins Glen, National Association, Watkins Glen Charter issued June 24, 1974 Glen National Bank and Trust Company, Watkins Glen OHIO Jan. 1, 1974 Jan. 2, 1974 Sept. 16, 1974 Sept. 30, 1974 The Farmers National Bank of Salem, Salem Northern Columbiana County National Bank, Salem Charter issued December 21, 1973 The Farmers National Bank of Salem, Salem The First National Bank of Cincinnati, Cincinnati FN National Bank, Cincinnati Charter issued December 21, 1973 The First National Bank of Cincinnati, Cincinnati The Athens National Bank, Athens The F.B.G. National Bank of Athens, Athens Charter issued September 12, 1974 The Athens National Bank, Athens The Citizens Baughman National Bank, Sidney The C.B. National Bank of Sidney, Sidney Charter issued September 27, 1974 The Citizens Baugham National Bank, Sidney See footnote at end of table. 189 TABLE B-9—Continued National bank charters issued* and mergers consummated pursuant to corporate reorganizations, by States, calendar 1974 Effective date of merger Operating bank New bank Resulting bank Total capital accounts Total assets OKLAHOMA Jan. Fidelity Bank, National Association, Oklahoma City Fidelity National Bank, Oklahoma City Charter issued December 19, 1973 2, 1974 Fidelity Bank, National Association, Oklahoma City $12,787,897 $279,733,914 1,573,251 19,029,193 2,326,289 25,401,014 1,998,274 21,983,902 3,611,976 42,762,468 3,373,668 44,689,570 1,916,522 28,271,365 1,179,812 10,597,615 1,995,536 23,776,436 263,417 2,001,160 173,725,584 2,862,368,727 3,871,418 31,822,439 2,614,514 35,155,066 2,284,262 31,379,735 2,984,620 35,670,084 TENNESSEE Jan. Jan. Feb. May July Hamilton National Bank of Loudon, Loudon Loudon Bank, N.A., Loudon Charter issued January 25, 1974 28, 1974 Hamilton National Bank of Loudon, Loudon The Farmers National Bank of Winchester, Winchester Winchester Bank, N.A., Winchester Charter issued January 25, 1974 28, 1974 The Farmers National Bank, Winchester National Bank of Murfreesboro, Murfreesboro The Second National Bank of Murfreesboro, Murfreesboro Charter issued February 26, 1974 28, 1974 The National Bank of Murfreesboro, Murfreesboro Old & Third National Bank of Union City, Union City The National Bank of Union City, Union City Charter issued May 8, 1974 9, 1974 Old & Third National Bank of Union City, Union City The Cleveland National Bank, Cleveland Cleveland Interim Bank, N.A., Cleveland Charter issued July 15, 1974 18, 1974The Cleveland National Bank, Cleveland TEXAS First National Bank in Grand Prairie, Grand Prairie Second National Bank in Grand Prairie, Grand Prairie Charter issued January 14, 1974 Jan. 18, 1974 First National Bank in Grand Prairie, Grand Prairie Texas National Bank of Dallas, Dallas Stemmons National Bank, Dallas Charter issued January 14, 1974 Jan. 18, 1974 Texas National Bank of Dallas, Dallas The First National Bank of Crockett, Crockett The New National Bank of Crockett, Crockett Charter issued March 14, 1974 Mar. 18, 1974 The First National Bank of Crockett, Crockett The First National Bank of Nordheim, Nordheim The New National Bank of Nordheim, Nordheim Charter issued March 29, 1974 Apr. 1, 1974The First National Bank of Nordheim, Nordheim Republic National Bank of Dallas, Dallas Ervay Bank, National Association, Dallas Charter issued May 7, 1974 May 9, 1974 Republic National Bank of Dallas, Dallas Guaranty National Bank and Trust of Corpus Christi, Corpus Christi Guaranty Commerce National Bank, Corpus Christi Charter issued July 24, 1974 July 26, 1974Guaranty National Bank and Trust of Corpus Christi, Corpus Christi First National Bank of Hurst, Hurst Hurst Commerce National Bank, Hurst Charter issued July 24, 1974 Aug. 2, 1974 First National Bank of Hurst, Hurst Farmers-First National Bank of Stephenville, Stephenville Stephenville National Bank, Stephenville Charter issued August 21, 1974 Aug. 26, 1974 Farmers-First National Bank of Stephenville, Stephenville The First National Bank in Cleburne, Cleburne Johnson County National Bank, Cleburne Charter issued October 31, 1974 Nov. 1, 1974 The First National Bank in Cleburne, Cleburne See footnote at end of table. 190 TABLE B-9—Continued National bank charters issued* and mergers consummated pursuant to corporate reorganizations, by States, calendar 1974 Effective date of merger Operating bank New bank Resulting bank Total capital accounts Total assets VIRGINIA The First National Bank in Onancock, Onancock Onancock Bank, N.A., Onancock Charter issued January 23, 1974 Feb. 1, 1974 The First National Bank in Onancock, Onancock The Colonial-American National Bank of Roanoke, Roanoke Colonial Bank, N.A., Roanoke Charter issued October 29, 1974 Oct. 31, 1974 The Colonial-American National Bank, Roanoke Community Bank and Trust Company, Springfield Virginia National Bank/Fairfax, Springfield Charter issued November 15, 1974 Nov. 18, 1974 Virginia National Bank/Fairfax, Springfield $1,254,878 $14,716,635 11,570,760 166,236,629 1,030,597 6,926,779 191,507,756 3,804,277,833 WASHINGTON July Seattle-First National Bank, Seattle SeaFirst National Bank, Seattle Charter issued June 20, 1974 1, 1974 Seattle-First National Bank, Seattle * Includes only charter issuances related to mergers consummated during 1974. Does not include Republic Bank, N. A., New York, N.Y., for which a charter was issued pursuant to corporate reorganization because it was merged with two operating banks. For that action see Table B-17. For a full listing of all charters issued pursuant to corporate reorganizations during the year, see Table B—11. 191 TABLE B-10 State-chartered banks converted* to National banks, by States, calendar 1974 Charter No. Title and location of bank Outstanding capital stock Effective date of charter $99,933,100 Total: 12 banks Surplus, undivided profits and reserves Total assets $178,279,667 $5,593,399,146 ARKANSAS 16272 First National Bank of Russellville, Russellville Conversion of The Bank of Russellville Jan. 28 450,000 1,850,601 33,103,535 Jan. 11 465,000 1,043,985 23,784,969 Jan. 2 300,000 369,328 8,714,721 Dec. 19, 1973 500,000 1,311,310 29,649,528 FLORIDA 16261 The First National Bank of Winter Haven, Winter Haven Conversion of Lake Region Bank of Commerce GEORGIA 16258 The First National Bank of Alma, Alma Conversion of Citizens State Bank ILLINOIS 16249 American National Bank, South Chicago Conversion of American Savings Bank IOWA 16324 Valley National Bank, Des Moines Conversion of Valley Bank and Trust Company May 10 1,250,000 3,879,463 64,324,067 Aug. 13 810,000 2,763,913 53,573,189 Aug. 1 3,500,000 7,564,304 164,375,684 1 First Pennsylvania Bank, National Association, Bala Cynwyd Conversion of the First Pennsylvania Banking & Trust Company . . . May 22 91,616,100 158,136,842 5,164,150,852 10 200,000 1,033,354 12,183,011 22 300,000 1,297,351 13,641,675 Dec. 19, 1973 242,000 780,124 17,762,228 May 300,000 572,766 7,656,268 MICHIGAN 16371 Commercial National Bank, Cassopolis Conversion of First Commercial Savings Bank MONTANA 16362 Security Bank, National Association, Billings Conversion of Security Trust & Savings Bank PENNSYLVANIA TENNESSEE 16410 First Tennessee National Bank, Unincorporated area of Davidson County Conversion of White's Creek Bank & Trust Company . . . . Dec. WEST VIRGINIA 16298 Western Greenbrier National Bank, Rainelle Conversion of The Western Greenbrier Bank 16248 The Bank of Warwood, National Association, Wheeling Conversion of The Bank of Warwood 16332 Community Savings Bank, National Association, Wheeling Conversion of Community Savings Bank Mar. 28 * Includes only conversions not pursuant to corporate reorganizations. In 1974, there was one such conversion, Community Bank and Trust Company, Springfield, Va., converted to Virginia National Bank/Fairfax, Springfield, Va., completed on Nov. 18, 1974. For complete information on that transaction see Table B—9. 192 TABLE B-ll National bank charters issued pursuant to corporate reorganizations, by States, calendar 1974 Charter No. Title and location of bank Date of issuance Total: 60 banks ALABAMA 15073 15481 15053 15402 1736 7084 First Bank of Athens, N.A., Athens Bank of Gadsden, N.A., Gadsden Bank of Phenix, N.A., Phenix City Gulf Coast National Bank of Robertsdale, Robertsdale Dallas County National Bank, Selma Selma Bank, N.A., Selma Total: 6 banks Mar. Aug. Nov. May Apr. Mar. 27 5 13 30 29 27 Dec. 27 Apr. Apr. Apr. Apr. 26 26 26 26 June 26 Aug. 16 June 28 June May May 24 30 8 Feb. Oct. Dec. Dec. Dec. Mar. May Mar. Dec. May 25 8 9 12 23 4 10 4 9 7 Apr. Apr. Apr. 26 26 26 May June June Aug. July 22 25 25 28 24 Feb. Mar. Jan. June June 26 25 31 28 24 ARKANSAS 14056 Jefferson National Bank, Pine Bluff COLORADO 15815 3661 13902 16054 Second National Bank in Aspen, Aspen Second National Bank in Glenwood Springs, Glenwood Springs Second National Bank in Grand Junction, Grand Junction Second National Bank-North, Grand Junction, Grand Junction Total: 4 banks ILLINOIS 13464 First National Bank & Trust Company, Alton INDIANA 14175 Tippecanoe National Bank, Lafayette MARYLAND 1413 Charles Street National Bank, Baltimore MASSACHUSETTS 428 Easthampton Bank (National Association), Easthampton 2153 Montachusett National Bank, Fitchburg 261 Second National Bank of New Bedford, New Bedford Total: 3 banks MICHIGAN 14933 12561 16037 9517 14456 15234 12027 15274 15403 3547 National Bank of Ann Arbor, Ann Arbor Evart Bank, N.A., Evart C. Bank, National Association, Grand Rapids GNB National Bank, Ironwood The Second National Bank of Ironwood, Ironwood LCM National Bank, Lake City UNB National Bank, Marquette NBR National Bank, Rochester V. National Bank, Township of Saginaw Sault National Bank, Sault Ste. Marie Total: 10 banks NEW HAMPSHIRE 318 The Concord Bank, National Association, Concord 4037 The Laconia Bank, National Association, Laconia 1520 The Merchants Bank, National Association, Manchester Total: 3 banks NEW JERSEY 14975 3168 2257 15228 12861 New Jersey National Bank-South, Township of Cherry Hill Midlantic National Bank/Cranbury, Township of Cranbury New Colonial First National Bank, Borough of Red Bank Second Plaza National Bank, Secaucus First Prospect Park National Bank, Township of Wayne Total: 5 banks 3696 8613 3186 15569 9977 Chase Manhattan Bank of Northern New York (National Association), Canton Hancock National Bank, Hancock Homer Bank, N.A., Homer Republic Bank, National Association, New York Bank of Watkins Glen, National Association, Watkins Glen .. Total: 5 banks NEW YORK 193 B-ll—Continued TABLE National bank charters issued pursuant to corporate reorganizations, by States, calendar 1974 Charter No. Title and location of bank Date of issuance OHIO 7744 The F.B.G. National Bank of Athens, Athens 7862 The C.B. National Bank of Sidney, Sidney Sept. Sept. 12 27 July 15 25 26 8 25 Total: 2 banks TENNESSEE 1666 12080 14736 9629 8640 Cleveland Interim Bank, N.A., Cleveland Loudon Bank, N.A., Loudon The Second National Bank of Murfreesboro, Murfreesboro . . . The National Bank of Union City, Union City Winchester Bank, N.A., Winchester Total: 5 banks 13107 14988 4684 12186 15501 14576 15072 12390 12730 Johnson County National Bank, Cleburne Guaranty Commerce National Bank, Corpus Christi The New National Bank of Crockett, Crockett Ervay Bank, National Association, Dallas Stemmons National Bank, Dallas Second National Bank in Grand Prairie, Grand Prairie Hurst Commerce National Bank, Hurst The New National Bank of Nordheim, Nordheim Stephenville National Bank, Stephenville Total: 9 banks Jan. Feb. May Jan. TEXAS Oct. July Mar. May Jan. Jan. July Mar. Aug. 31 24 14 7 14 14 24 29 21 VIRGINIA Jan. 13878 Onancock Bank, N.A., Onancock 11817 Colonial Bank, N.A., Unincorporated area of Roanoke County 16398 Virginia National Bank/Fairfax, Springfield Oct. Nov. 23 29 15 June 20 Total: 3 banks WASHINGTON 11280 SeaFirst National Bank, Seattle TABLE B-12 National banks reported in voluntary liquidation, by States, calendar 1974 Title and location of bank Total capital accounts of liquidated banks Date of liquidation Total: 6 National banks $15,107,691 ALABAMA The Peoples Bank at Selma Mall, National Association (15995), absorbed by The Peoples Bank & Trust Jan. Company, Selma 1 511,879 22 7,585,458 14 2,903,390 Mar 29 128,554 Nov. 15 2,674,610 Dec. 2 1,303,800 CALIFORNIA Beverly Hills National Bank, Beverly Hills (13348), absorbed by Wells Fargo Bank, National Association, San Francisco (15660) Jan. MISSISSIPPI Citizens National Bank, Jackson (15516), absorbed by First Mississippi National Bank, Hattiesburg (5176) Nov. NEW YORK The First National Bank of Hamden, Hamden (12017), absorbed by The First National Bank of Hancock, Hancock (8613) PENNSYLVANIA Blairsville National Bank, Blairsville (13868), absorbed by Pittsburgh National Bank, Jeannette (252) WASHINGTON Guaranty National Bank of White Center, Seattle (14502), absorbed by Old National Bank of Washington, Spokane (4668) 194 TABLE B-13 National banks merged or consolidated with State banks, by States, calendar 1974 Title and location of bank Total capital accounts of National banks Effective date $51,599,783 Total: 13 banks CALIFORNIA Liberty National Bank, San Francisco (13178), merged into The Chartered Bank of London, San Francisco, under title of "The Chartered Bank of London" July 1 5,135,683 May 14 2,119,095 Jan. 2 399,905 May 16 1,217,743 1 3,060,498 31 993,950 30 604,764 31 24,611,668 CONNECTICUT The Clinton National Bank, Clinton (1314), merged into The Connecticut Bank and Trust Company, Hartford, under title of 'The Connecticut Bank and Trust Company" IOWA The First National Bank of Klemme, Klemme (6659), merged into State Savings Bank, Goodell, under title of "North Iowa State Bank" MASSACHUSETTS The Buzzards Bay National Bank, Buzzards Bay (13222), merged into Cape Cod Bank and Trust Company, Barnstable, under title of "Cape Cod Bank and Trust Company" NEW YORK United National Bank of Long Island in New York, Forest Hills (13242), merged into Valley Bank of New Apr. York, Valley Stream, under title of "Valley Bank of New York" The First National Bank of Marion, Marion (10546), merged into Central Trust Company Rochester, New York, Rochester, under title of "Central Trust Company Rochester, New York" May Montour National Bank in Montour Falls, Montour Falls (13583), merged into Chemung Canal Trust Company, Elmira, under title of "Chemung Canal Trust Company" Apr. First Westchester National Bank, New Rochelle (13955), merged into Barclays Bank of New York, New York, under title of "Barclays Bank of New York" May PENNSYLVANIA The First National Bank of Altoona, Altoona (247), merged into Central Counties Bank, State College, Dec. 31 under title of "Central Counties Bank" The Loganton National Bank in Loganton, Loganton (9345), merged into The State Bank of Avis, Avis, Nov. 11 under title of "The State Bank of Avis" The First National Bank of Montoursville, Montoursville (6997), consolidated with Bank of South WilliamsDec. 31, 1973 port, South Williamsport, under title of "Bank of Central Pennsylvania" The Plymouth National Bank, Plymouth (6881), merged into Northeastern Bank of Pennsylvania, ScranSept. 30 ton, under title of "Northeastern Bank of Pennsylvania" 7,185,490 285,568 2,372,960 2,785,968 VERMONT National White River Bank in Bethel, Bethel (13755), merged into Proctor Trust Company, Proctor, under title of "Proctor Trust Company" Jan. 12 826,491 195 TABLE B-14 National banks converted into State banks, by States, calendar 1974 Charter No. Title and location of bank Total capital accounts of National banks Effective date $146,728,590 Total: 19 banks ILLINOIS 5638 The First National Bank of Dundee, Dundee, converted into The First Bank of Dundee 14 1,337,028 75 1,046,730 June 28 342,370 Oct. 1 1,157,756 June 11 1,180,653 May 1 1,172,217 10 10 1,632,100 2,720,803 July July Mar. 1 1 18 20,896,196 11,585,244 2,238,064 Jan. July 2 15 32,994,842 10,371,925 Bankers Trust of South Carolina, National Association, Columbia, converted into Bankers Trust of South Carolina Dec. Q 39,443,129 1 9 11 1,141,199 1,356,964 10,064,639 ?4 1,547,473 6 4,499,258 Sept. INDIANA 9077 The Farmers and Merchants National Bank, Fort Branch, converted into The Farmer's and Merchants Bank of Fort Branch AOT. IOWA 5912 The First National Bank of Prescott, Prescott, converted into First State Bank MISSISSIPPI 15559 First National Bank of Greenwood, Greenwood, converted into First Greenwood Bank NEBRASKA 15376 City National Bank and Trust Company of Lincoln, Lincoln, converted into Citibank and Trust Company of Lincoln . . . . . NEW HAMPSHIRE 14100 Berlin City National Bank, Berlin, converted into The Berlin City Bank OKLAHOMA 10286 The Madill National Bank, Madill, converted into The Madill Bank and Trust Company Sept. 15350 Republic National Bank of Tulsa, Tulsa, converted into Republic Bank and Trust Company . . . May PENNSYLVANIA 2634 5773 478 77 The Fulton National Bank of Lancaster, Lancaster, converted into Fulton Bank Farmers First National Bank, Lititz, converted into Farmers First Bank The First National Bank of Pittston, Pittston, converted into The First Bank of Greater Pittston . Northeastern National Bank of Pennsylvania, Scranton, converted into Northeastern Bank of Pennsylvania .. 5184 Southern Pennsylvania National Bank, York, converted into Southern Pennsylvania Bank SOUTH CAROLINA 10635 TEXAS 8156 15833 14S30 12789 Apr. The Elgin National Bank Elgin converted into Elgin Bank of Texas July People's National Bank of Spring Branch, Houston, converted into Peoples Bank Western National Bank of Houston, Houston, converted into Western Bank July The First National Bank of Raymondville, Raymondville, converted into Raymondville Bank of Texas June VERMONT 1197 The Merchants National Bank, Burlington, converted into The Merchants Bank 196 Sept. TABLE B-15 Purchases of State banks by National banks, by States, calendar 1974 Title and location of bank Effective date Total: 8 banks Total capital accounts of State banks $3,483,272 IOWA The Okey-Vernon National Bank of Corning, Corning (8725), purchased First State Bank, Prescott July 1 342,370 The Shelby National Bank of Shelbyville, Shelbyville (7946), purchased The Union State Bank, Morristown Feb. 11 323,256 11 0 Sept. 28 938,000 INDIANA MARYLAND Maryland National Bank, Baltimore (13745), purchased Eutaw Savings Bank of Baltimore, Baltimore Apr. MICHIGAN Michigan National Bank of Macomb, Warren (16387), purchased The Tri-City Bank, Warren OHIO The People's National Bank of Georgetown, Georgetown (5996), purchased Citizens Bank Co., Hamersville Feb. 26 203,671 Nov. 18 1,209,372 Apr. The Baraboo National Bank, Baraboo (14397), purchased Farmers State Bank, Rock Springs The First National Bank of the City of Superior, Superior (3926), purchased Wisconsin State Bank, Superior July 12 15 162,603 304,000 PENNSYLVANIA National Bank of the Commonwealth, Indiana (14098), purchased The Houtzdale Bank, Houtzdale WISCONSIN 197 TABLE B-16 Consolidations* of National banks, or National and State banks, by States, calendar 1974 Consolidating banks Resulting bank Effective date Outstanding capital stock Surplus Undivided profits and reserves Total assets Total: 8 consolidations ALABAMA The First National Bank of Jasper, Jasper (7746) Dora Banking and Trust Company, Dora Apr. 30 The First National Bank of Jasper, Jasper (7746) $1,000,000 200,000 2,280,000 $2,000,000 200,000 2,280,000 $2,426,004 331,060 1,604,610 $52,221,754 7,334,748 59,584,573 2,266,640 500,000 3,356,640 4,223,360 2,100,000 6,343,360 1,640,223 526,120 1,556,342 111,756,697 45,408,250 157,164,947 263,900 508,980 659,750 950,000 2,600,000 3,663,130 659,750 3,663,130 162,620 105,721 278,375 328,664 21,453,037 37,504,693 58,957,729 57,810,852 797,500 1,650,000 402,383 38,611,251 1,082,425 5,687,955 731,047 96,422,102 869,028 1,104,900 1,179,900 250,000 5,800,000 6,275,000 19,028 1,282,705 1,301,733 11,817,634 105,753,788 117,571,421 250,000 240,000 490,000 300,000 260,000 560,000 243,200 138,606 381,806 9,719,392 7,274,631 16,994,023 165,000 250,000 415,000 220,000 415,000 635,000 506,402 518,215 1,024,617 15,188,669 22,416,787 37,605,457 4,760,000 1,250,000 8,000,000 6,240,000 2,500,000 8,000,000 5,660,730 964,857 5,375,586 302,480,978 108,584,051 411,065,029 MASSACHUSETTS Aug. 16 The County Bank, N.A., Cambridge (4771) Lexington Trust Company, Lexington The County Bank, National Association (4771) MISSISSIPPI Mar. Oct. First National Bank of Monroe County, Aberdeen (3656) . Peoples Bank Starkville 1 First United National Bank, Starkville (3656) National Bank of Mississippi, Starkville (3656) The National Bank of Commerce of Columbus, Columbus (10361) 1 National Bank of Commerce of Mississippi, Starkville (3656) NEW HAMPSHIRE Indian Head National Bank of Manchester, Manchester (15563) Indian Head National Bank of Nashua, Nashua (1310) . . . Nov. 29 Indian Head National Bank of Nashua, Nashua (15563) .. OHIO Apr. The First National Bank of Versailles, Versailles (9336) .. The Peoples Bank Company, Versailles 1 Peoples National Bank, Versailles (9336) July The First National Bank of Confluence, Confluence (5307) First National Bank of Somerset County, Berlin (5823) . . . 29 National Bank of Western Pennsylvania, Berlin (5307) . . . Jan. United Virginia Bank/First & Citizens National, Alexandria (651) United Virginia Bank of Fairfax, Vienna 2 United Virginia Bank/National, Alexandria (651) PENNSYLVANIA VIRGINIA Excludes consolidations involving only one operating bank, effected pursuant to corporate reorganization. 198 TABLE B-17 Mergers* of National banks, or National and State banks, by States, calendar 1974 Effective date Merging banks Resulting bank Outstanding capital stock Surplus Undivided profits and Total assets reserves Total: 43 merger actions CALIFORNIA Palm Springs National Bank, Palm Springs (15276) First National Bank and Trust Company, Ontario (6268) Jan. 1 First National Bank and Trust Company, Ontario (6268) Hayward National Bank, Hayward (15343) The First National Bank of San Jose, San Jose (2158) July 31 The First National Bank of San Jose, San Jose (2158) Commercial National Bank, Buena Park (15434) Wells Fargo Bank, National Association, San Francisco (15660) .. . Aug. 23 Wells Fargo Bank, National Association, San Francisco (15660) . . . $181,113 $859,365 2,349,950 1,840,080 2,985,308 2,245,200 425,900 705,020 7,600,000 5,603,690 6,308,710 8,025,900 483,724 1,355,865 93,010,320 260,664,910 94,461,100 261,053,719 $195,366 $24,710,462 2,155,404 128,773,855 1,960,038 153,484,317 608,877 16,876,039 4,444,381 283,984,707 5,053,258 300,860,747 512,854 33,069,076 78,416,062 9,819,837,927 78,928,916 9,852,907,003 INDIANA Farmers State Bank, Plainville The Peoples National Bank and Trust Company of Washington, Washington (3842) Apr. 30 The Peoples National Bank and Trust Company of Washington, Washington (3842) 25,000 50,000 137,576 1,876,645 300,000 400,000 562,737 24,867,345 346,250 450,000 679,063 26,682,905 100,000 1,500,000 1,589,000 100,000 2,000,000 2,111,000 96,000 1,502,605 1,596,437 375,066 95,337,656 93,805,519 271,000 5,500,000 5,771,000 229,000 6,000,000 6,229,000 769,000 9,134,904 9,903,905 9,128,913 169,462,647 178,591,559 300,000 17,000,000 17,000,000 600,000 38,000,000 38,000,000 97,500 3,159,160 3,256,660 125,000 246,905 303,155 52,500 7,899,880 7,952,380 105,000 263,000 436,750 361,006 3,999,780 4,360,786 200,817 1,362,606 1,563,423 7,553,765 172,221,639 179,775,404 5,474,903 33,622,896 39,097,799 300,000 10,481,625 10,808,625 1,200,000 37,018,375 39,191,375 130,787 2,527,709 1,661,844 17,544,879 775,645,596 789,457,648 400,000 400,000 800,000 250,000 16,725,870 16,975,570 400,000 265,000 665,000 250,000 33,467,013 33,717,013 630,000 590,305 900,000 1,762,000 906,027 72,047,509 1,125,000 1,000,000 1,000,000 2,000,000 899,890 7,836,000 7,836,000 4,417,000 1,500,000 1,000,000 2,500,000 1,000,000 14,501,375 14,501,375 906,027 428,639 712,705 1,279,292 2,096,470 7,608,908 7,423,768 83,449,286 44,837,737 37,317,025 82,605,008 56,959,716 486,446,643 543,281,539 IOWA Farmers Loan and Trust Company, Sioux City The Toy National Bank of Sioux City, Sioux City (10139). Sept. 16 The Toy National Bank, Sioux City (10139) KANSAS The Victory State Bank, Kansas City Security National Bank of Kansas City, Kansas City (13801) Nov. 29 Security National Bank of Kansas City, Kansas City (13801) MARYLAND Jan. Sykesville State Bank, Sykesville Maryland National Bank, Baltimore (13745). 4 Maryland National Bank, Baltimore (13745). 455,185 14,481,227 61,523,378 1,732,138,222 62,878,563 1,745,392,289 MICHIGAN The Farmers State Bank of Concord, Concord The National Bank of Jackson, Jackson (13741) May 31 The National Bank of Jackson, Jackson (13741) New Haven Savings Bank, New Haven The National Bank of Richmond, Richmond (13793) Dec. 31 The National Bank of Richmond, Richmond (13793) MISSISSIPPI Leflore Bank and Trust Company, Greenwood Deposit Guaranty National Bank, Jackson (15548) June 28 Deposit Guaranty National Bank, Jackson (15548) NEW JERSEY Mar. 31 Mar. 31 May 31 June 7 Aug. 2 Midlantic National Bank/Parsippany, Parsippany-Troy Hills (15975) Midlantic National Bank/Morris, Morristown (15360) Midlantic National Bank/Morris, Morristown (15360) Millburn-Short Hills Bank, Millburn Midlantic National Bank, Newark (1316) Midlantic National Bank, Newark (1316) Madison State Bank, Madison Township Peoples National Bank of Monmouth County, Hazlet Township (4147) United Jersey Bank/Mid State, National Association, Hazlet Township (4147) First National State Bank of Ocean County, Lakewood (16035) First National State Bank of the Jersey Coast, Spring Lake (13898) First National State Bank of the Jersey Coast, Spring Lake (13898) Belmar-Wall National Bank, Wall Township (13848) The First Jersey National Bank, Jersey City (374) The First Jersey National Bank, Jersey City (374) 93,129 8,997,817 107,135 12,315,879 200,265 21,313,697 903,425 49,402,960 25,648,937 1,004,152,034 26,552,362 1,053,554,995 9,895,881 0 See footnote at end of table. 199 TABLE B-17—Continued Mergers* of National banks, or National and State banks, by States, calendar 1974 Effective date Oct. 29 Oct. 31 Oct. 31 Nov. 29 Dec. 2 Dec. 30 Merging banks Resulting bank NEW JERSEY—Continued Citizens State Bank, Vineland Citizens Bank of Maple Shade, Maple Shade Citizens National Bank of South Jersey, Bridgeton (2999) Citizens Bank of Marlton, National Association, Marlton (13125) . . . Citizens United Bank, National Association, Vineland (13125) Oakland State Bank, Oakland Citizens First National Bank of New Jersey, Ridgewood (11759) Citizens First National Bank of New Jersey, Ridgewood (11759) Fairneld National Bank, Fairfield (15857) New Jersey Bank (National Association), Clifton (15709) New Jersey Bank (National Association), Clifton (15709) Egg Harbor Bank and Trust Company, Egg Harbor City Mechanics National Bank of Delaware Valley, Burlington Township (1222) First National State Bank/Mechanics, Burlington (1222) United Jersey National Bank of Cherry Hill, Cherry Hill (15971) Third National Bank of New Jersey, Camden (13203) United Jersey Bank/Third National, Camden (13203) The First National Bank of Westwood, Westwood (8777) New Jersey Bank (National Association), Clifton (15709) New Jersey Bank (National Association), Clifton (15709) Outstanding capital stock Surplus $1,250,000 500,000 460,005 675,568 2,885,573 500,000 5,239,760 5,614,760 500,000 9,693,096 9,693,096 900,000 $750,000 473,013 670,001 1,036,562 2,929,576 387,538 5,388,230 5,913,230 500,000 24,921,108 23,639,069 900,000 2,750,000 3,650,000 500,000 1,062,500 1,562,500 425,250 9,693,096 9,693,096 2,750,000 3,650,000 250,000 724,706 1,098,869 1,074,750 23,639,069 19,856,010 350,000 789,669 1,090,450 100,000 3,876,720 4,156,720 1,000,000 2,470,324 3,519,543 Undivided profits and reserves $543,711 291,295 389,833 212,575 1,437,414 70,000 10,136,247 10,113,449 167,731 9,563,098 9,563,098 673,003 929,771 1,602,774 124,163 0 0 1,147,693 9,105,272 9,105,272 Total assets $50,685,279 20,129,415 26,441,564 33,498,441 130,754,699 8,566,397 241,475,526 249,151,711 8,095,383 758,661,811 764,858,801 24,280,566 109,646,386 133,926,951 10,836,278 64,102,809 74,939,087 37,882,853 752,139,150 783,462,337 NEW YORK May June July Nov. 17 28 1 29 Lewis County Trust Company, Lowville The St. Lawrence National Bank, Canton (8531) The St. Lawrence National Bank, Canton (8531) The National Bank of Hobart, Hobart (4497) The National Bank and Trust Company of Norwich, Norwich (1354) The National Bank and Trust Company of Norwich, Norwich (1354) Republic Bank, National Association, New York Kings Lafayette Bank, New York Republic National Bank of New York, New York (15569) Republic National Bank of New York, New York (15569) The First National Bank of Cooperstown, Cooperstown (280) Bankers Trust Company of Albany, National Association, Albany (15758) Bankers Trust Company of Albany, National Association, Albany (15758) 26,017,160 79,901,518 107,033,826 6,251,306 143,864,859 150,157,667 200,000 10,000,000 11,282,080 21,482,080 150,000 3,876,720 4,156,720 40,000 6,500,000 14,841,090 22,466,261 783,069 2,242,466 3,027,974 351,968 3,815,580 3,864,191 0 6,315,363 29,484,282 29,484,282 965,000 224,190,575 565,630,656 782,781,076 250,000 400,000 992,860 17,791,081 4,400,000 8,000,000 11,662,879 266,520,970 4,400,000 8,650,000 12,655,739 284,312,051 300,000 46,171,968 46,471,968 700,000 52,180,946 52,880,945 100,000 1,100,000 19,174,569 716,020 31,633,945 3,109,145,446 32,374,378 3,128,334,357 334,578 16,584,986 51,360,070 70,800,000 57,842,297 2,975,719,479 51,360,070 72,000,000 58,176,876 2,992,304,465 150,000 2,200,000 2,560,000 40,000 150,000 190,000 500,000 2,560,000 3,060,000 100,000 210,000 310,000 369,106 3,060,953 3,290,098 66,599 405,906 462,548 10,286,299 100,413,248 109,383,244 250,000 246,148 0 7,473,617 1,000,000 500,000 461,093 8,631,213 1,250,000 746,148 461,093 16,104,831 NORTH CAROLINA May Dec. The First National Bank of Mount Airy, Mount Airy (4896) North Carolina National Bank, Charlotte (13761) 17 North Carolina National Bank, Charlotte (13761) Citizens Bank, Marshall Wachovia Bank and Trust Company, National Association, Winston-Salem (15673) 30 Wachovia Bank and Trust Company, National Association, Winston-Salem (15673) OHIO Jan. Dec. Dec. Beach City Banking Company, Beach City The United National Bank and Trust Company, Canton (14501) 1 The United National Bank and Trust Company, Canton (14501) The Freeport State Bank, Freeport Harrison County National Bank, Hopedale (6938) 21 Harrison County National Bank, Hopedale (6938) The Farmers and Merchants Bank of Englewood, Englewood The Central Trust Company of Montgomery County, National Association, Dayton (16330) 31 The Central Trust Company of Montgomery County, National Association, Dayton (16330) See footnote at end of table. 200 2,866,775 9,505,483 12,372,258 TABLE B-17—Continued Mergers* of National banks, or National and State banks, by States, calendar 1974 Merging banks Resulting bank Effective date Outstanding capital stock Surplus Undivided profits and reserves Total assets PENNSYLVANIA May May 10 31 June 10 Sept. .30 Nov. 15 The Hummelstown National Bank, Hummelstown (2822) The Fulton National Bank of Lancaster, Lancaster (2634) The Fulton National Bank of Lancaster, Lancaster (2634) The Dime Bank of Lansford, Lansford Pennsylvania National Bank and Trust Company, Pottsville (1663) Pennsylvania National Bank and Trust Company, Pottsville (1663) The First National Bank of Factoryville, Factoryville (9130) The Wyoming National Bank of Wilkes-Barre, Wilkes-Barre (732) . The Wyoming National Bank of Wilkes-Barre, Wilkes-Barre (732) . The Duncannon National Bank, Duncannon (4142) Cumberland County National Bank and Trust Company, New Cumberland (14542) Cumberland County National Bank and Trust Company, New Cumberland (14542) The Berwick National Bank, Berwick (6162) The First National Bank of Eastern Pennsylvania, Wilkes-Barre (30) First Eastern Bank, National Association, Wilkes-Barre (30) $250,000 2,485,875 2,767,125 50,000 1,737,500 1,837,500 75,000 1,300,600 1,431,850 $1,250,000 5,652,350 6,902,350 350,000 8,150,000 8,500,000 250,000 3,381,560 3,722,810 278,435 3,127,937 3,241,091 254,555 3,302,133 3,409,188 $19,652,739 255,255,958 274,908,698 10,719,813 206,100,697 216,877,111 5,750,662 134,984,599 140,735,261 130,000 235,000 490,713 10,887,945 1,845,620 5,129,380 3,969,460 225,799,364 1,845,620 174,000 4,926,800 5,579,300 5,494,380 976,000 8,286,400 9,262,400 4,460,173 412,392 7,678,690 7,960,810 236,687,309 22,048,850 381,565,461 403,091,570 800,000 1,048,306 815,681 33,698,335 16,329,490 5,686,005 7,389,821 519,892,860 18,196,160 300,000 2,000,000 2,430,000 5,667,641 500,000 3,000,000 3,320,000 1,000,000 15,000,000 17,000,000 8,205,502 334,635 2,753,489 3,088,124 697,749 17,025,395 16,930,530 475,000 15,000,000 17,000,000 240,371 17,025,395 16,930,530 553,591,195 16,784,082 97,918,723 114,702,805 14,351,449 511,034,589 532,638,256 12,621,018 511,034,589 532,638,256 25,000 3,000,000 3,025,000 350,000 3,000,000 3,350,000 298,025 2,945,444 3,243,469 6,430,772 180,284,114 186,714,886 499,600 1,802,875 3,051,875 50,000 125,000 800,000 800,000 787,320 2,556,545 3,343,865 100,000 160,000 800,000 800,000 1,180,986 2,938,677 3,370,263 335,481 14,900 1,015,377 1,015,377 34,785,131 121,496,942 154,110,108 4,560,089 5,726,429 30,688,474 39,836,587 709,030 1,875,970 2,506,350 523,562 2,924,481 3,305,742 243,687 1,200,183 1,664,821 19,496,742 94,885,747 112,274,685 $434,496 8,049,268 8,452,514 SOUTH CAROLINA The Peoples Bank, Beaufort Bankers Trust of South Carolina, National Association, Columbia (10635) Apr. 22 Bankers Trust of South Carolina, National Association, Columbia (10635) The Farmers Bank, Loris The National Bank of South Carolina of Sumter, Sumter (10660) June 10 The National Bank of South Carolina, Sumter (10660) Palmetto Bank and Trust Company, Lake City First National Bank of South Carolina, Columbia (13720) Dec. 31 First National Bank of South Carolina, Columbia (13720) The Bank of Walterboro, Walterboro First National Bank of South Carolina, Columbia (13720) Dec. 31 First National Bank of South Carolina, Columbia (13720) 220,000 5,000,000 6,000,000 275,000 5,000,000 6,000,000 SOUTH DAKOTA Oct. The First National Bank in Bristol, Bristol (10868) First National Bank of Aberdeen, Aberdeen (2980) 1 First National Bank of Aberdeen, Aberdeen (2980) VERMONT Montpelier National Bank, Montpelier (13915) Vermont National Bank, Brattleboro (1430) Nov. 29 Vermont National Bank, Brattleboro (1430) The Northfield National Bank, Northfield (1638) The First National Bank of Fair Haven, Fair Haven (344). First National Bank of Springfield, Springfield (122) Dec. 30 First National Bank of Springfield, Springfield (122) VIRGINIA Apr. Peoples Bank and Trust Company of Fairfax, Fairfax County, Alexandria Dominion National Bank, Baileys Cross Roads (14904) 1 Dominion National Bank, Baileys Cross Roads (14904) * Excludes mergers involving only one operating bank, effected pursuant to corporate reorganization. 201 TABLE B-18 Mergers resulting inNational banks, by assets of acquiring and acquired banks, 1960—74* Assets of acquired bank— Assets of acquiring bankst Under $10 million $10 million to $24 9 million $25 million to $49.9 million $50 million to $99.9 million $100 million and over Total Acquired banks 1960-74 Under $10 million $10 million to $25 million to $50 million to $100 million and over $99.9 $49.9 $24.9 million million million 92 144 164 181 564 92 126 109 110 231 0 18 43 44 200 0 0 12 24 73 0 0 0 3 26 0 0 0 0 34 1,145* 668 305 109 29 34 * Includes all forms of acquisitions involving two or more banks from May 13, 1960 through December 31, 1974. t In each transaction, the bank with larger total assets was considered to be the acquiring bank. t Comprises 1,101 transactions, 25 involving three banks, eight involving four banks, and one involving five banks. TABLE B-19 Domestic branches entering the National Banking System, by de novo opening, merger, or conversion, by States, calendar 1974 Charter No. Branches opened for business Title and location of bank Local 392 Total 11820 15339 15473 3185 15342 14638 14414 6380 14664 5249 14614 8765 15267 7746 1595 9550 3452 15604 7558 1853 ALABAMA T h e Albertville National Bank, Albertville Auburn National Bank of Auburn, Auburn , City National Bank of Birmingham, Birmingham The First National Bank of Birmingham, Birmingham . . . First National Bank of Butler, Butler First National Bank of Childersburg, Childersburg Central Bank of Alabama, National Association, Decatur First National Bank of Decatur, Decatur City National Bank of Dothan, Dothan The First National Bank of Dothan, Dothan , First National Bank of Eufaula, Eufaula The Henderson National Bank of Huntsville, Huntsville , Peoples National Bank of Huntsville, Huntsville The First National Bank of Jasper, Jasper , The First National Bank of Mobile, Mobile The Farmers National Bank of Opelika, Opelika , The First National Bank of Opelika, Opelika Central Bank of Mobile National Association, Prichard ., The Talladega National Bank, Talladega The First National Bank of Tuscaloosa, Tuscaloosa 12072 14651 14747 12578 The First National Bank of Anchorage, Anchorage National Bank of Alaska, Anchorage Alaska National Bank, Fairbanks The First National Bank of Ketchikan, Ketchikan ALASKA , ARIZONA 3728 First National Bank of Arizona, Phoenix 14324 The Valley National Bank of Arizona, Phoenix * Includes 6 automated teller machines beginning operations in 1974. 202 Outside branches 794 Total 1,186* TABLE B-19—Continued Domestic branches entering the National Banking System, by de novo opening, merger, or conversion, by States, calendar 1974 Charter No. Branches opened for business Title and location of bank Total Outside branches Local ARKANSAS 10087 16173 14493 13719 15504 7046 12424 9501 1950 15039 2832 14000 13949 13958 13693 16272 15665 12156 15257 12914 14631 11312 15608 Citizens First National Bank of Arkadelphia, Arkadelphia First National Bank of Sharp County, Ashflat First National Bank, Batesville The First National Bank of Conway, Conway First National Bank of Crossett, Crossett The First National Bank of El Dorado, El Dorado National Bank of Commerce of El Dorado El Dorado The First National Bank of Fordyce Fordyce The First National Bank of Fort Smith Fort Smith ... ... . The First National Bank in Harrison, Harrison First National Bank of Hot Springs, Hot Springs The Commercial National Bank of Little Rock, Little Rock The First National Bank in Little Rock, Little Rock Union National Bank of Little Rock Little Rock First National Bank in Mena, Mena First National Bank of Russellville, Russellville First National Bank, Siloam Springs First National Bank in Stuttgart, Stuttgart Commercial National Bank of Texarkana, Texarkana Jackson County National Bank in Tuckerman, Tuckerman Citizens National Bank of Walnut Ridge, Walnut Ridge The First National Bank of Lawrence County at Walnut Ridge, Walnut Ridge Fidelity National Bank of West Memphis West Memphis 14695 15434 11282 15453 14823 16139 15305 2491 6919 6268 15532 16154 15349 3050 13044 9655 1741 15660 2158 15217 15180 City National Bank, Beverly Hills Commercial National Bank, Buena Park The First National Bank of Cloverdale, Cloverdale . . Escondido National Bank, Escondido ... Valley National Bank, Glendale, Glendale Foothill National Bank, Glendora Valley Bank, National Association, Livermore Security Pacific National Bank, Los Angeles Central Bank, National Association, Oakland First National Bank and Trust Company, Ontario Commercial and Farmers National Bank, Oxnard Delta National Bank, Riverbank Valley National Bank, Salinas Southern California First National Bank, San Diego ... Bank of America National Trust and Savings Association, San Francisco The Bank of California, National Association, San Francisco ... Crocker National Bank, San Francisco Wells Fargo Bank, National Association San Francisco The First National Bank of San Jose, San Jose Tahoe National Bank, South Lake Tahoe Security National Bank, Walnut Creek 7904 2355 3879 15332 14384 13624 The First National Bank in Alamosa, Alamosa The National State Bank of Boulder, Boulder The First National Bank, Canon City Colorado, Canon City The First National Bank of Bear Valley, Denver The First National Bank in Golden, Golden .. First National Bank in Loveland, Loveland 780 335 14750 1338 16125 2 15549 16006 497 The City National Bank of Connecticut, Bridgeport The Connecticut National Bank, Bridgeport First National Bank of Enfield, Enfield Hartford National Bank and Trust Company, Hartford National Industrial Bank of Connecticut, Meriden The First New Haven National Bank, New Haven Citizens National Bank of Southington, Southington Liberty National Bank, Stamford The First National Bank of Suffield, Suffield 1 0 1 0 0 1 1 1 1 1 0 3 1 3 1 1 1 1 0 0 0 1 1 0 1 0 1 1 0 0 0 0 0 1 0 0 0 0 0 0 1 1 1 1 0 0 1 1 1 1 1 1 1 1 1 1 1 3 1 3 1 1 1 2 1 1 1 1 1 0 0 0 0 0 0 0 1 1 1 1 1 1 1 1 14 1 2 1 1 1 1 27 1 9 8 3 1 1 1 15 1 2 2 1 1 1 27 1 10 9 4 1 2 0 0 0 0 0 0 1 1 1 1 1 1 2 2 0 1 1 2 0 0 1 2 2 1 1 1 2 1 1 1 CALIFORNIA .... o 0 1 ... o o o 0 ... o1 1 1 0 1 COLORADO CONNECTICUT 0 0 1 0 0 o 1 1 0 203 TABLE B-19—Continued Domestic branches entering the National Banking System, by de novo opening, merger, or conversion, by States, calendar 1974 Charter No. Title and location of bank Local DISTRICT OF COLUMBIAt 15656 15208 3425 15605 5046 3275 McLachlen National Bank, District of Columbia Madison National Bank, District of Columbia The National Bank of Washington, District of Columbia National Savings and Trust Company, District of Columbia The Riggs National Bank of Washington, D.C., District of Columbia . . . Union Trust Company of the District of Columbia, District of Columbia 15425 14556 15050 16008 15878 6888 14923 11038 14845 15103 14639 15043 15062 9007 14902 15107 14«44 13352 14714 14897 14827 15071 15270 13437 14767 Second National Bank of Clearwater, Clearwater Sun First National Bank of Delray Beach, Delray Beach Barnett Bank of Fort Myers, National Association, Fort Myers Hollywood National Bank, Hollywood Citizens First National Bank of Citrus County, Inverness The Atlantic National Bank of Jacksonville, Jacksonville Sun First National Bank of Lake Wales, Lake Wales Sun First National Bank of Leesburg, Leesburg Sun First National Bank of Melbourne, Melbourne First National Bank of Merritt Island, Merritt Island Peoples First National Bank of Miami Shores, Miami Shores First National Bank of New Port Richey, New Port Richey Sun Bank of East Orlando, National Association, Orlando The Citizens and Peoples National Bank of Pensacola, Pensacola Florida First National Bank at Port St. Joe, Port St. Joe National Bank Gulf Gate, Sarasota National Bank of Sarasota, Sarasota Palmer First National Bank and Trust Company of Sarasota, Sarasota . Barnett Bank of St. Petersburg, National Association, St. Petersburg .. The National Bank of St. Petersburg, St. Petersburg Pan American Bank of Tampa, National Association, Tampa First National Bank of Venice, Venice Barnett Bank of Cypress Gardens National Association, Winter Haven . The Exchange National Bank of Winter Haven, Winter Haven Barnett Bank of Winter Park, National Association, Winter Park 1559 9617 15789 15541 14499 4691 15148 14817 7616 11936 15373 10302 13068 15616 9302 The First National Bank of Atlanta, Atlanta The Fulton National Bank of Atlanta, Atlanta Mercantile National Bank, Atlanta The National Bank of Georgia, Atlanta The Commercial National Bank, Cedartown The National Bank and Trust Company of Columbus, Ga., Columbus .. First National Bank of Newton County, Covington National Bank of Fort Benning, Fort Benning The Gainesville National Bank, Gainesville First National Bank of Gwinnett County, Lawrenceville First National Bank of Houston County, Perry The National City Bank of Rome, Rome The Citizens and Southern National Bank, Savannah The Security National Bank, Smyrna The First National Bank of Thomson, Thomson FLORIDA GEORGIA IDAHO 16237 Bank of Idaho, N.A., Boise 14444 First Security Bank of Idaho, National Association, Boise . 1668 The Idaho First National Bank, Boise ILLINOIS 12779 15459 4735 14752 14463 14416 15458 14346 First National Bank of Blue Island, Blue Island Seaway National Bank of Chicago, Chicago The Elgin National Bank, Elgin The First National Bank of Lincolnwood, Lincoln wood First National Bank, Marshall Central National Bank of Mattoon, Mattoon Midwest National Bank of Moline, Moline The Ogle County National Bank of Oregon, Oregon . . . t Includes 1 non-National bank in Washington, D.C. 204 Branches opened for business Outside branches Total TABLE B-19—Continued Domestic branches entering the National Banking System, by de novo opening, merger, or conversion, by States, calendar 1974 Charter No. Title and location of bank Branches opened for business Local Outside branches Total INDIANA 4675 14515 206 12132 12444 14468 13759 984 869 16018 2612 15784 13717 14921 9756 4678 4800 7946 13987 12028 47 13888 3842 First National Bank of Madison County, Anderson First National Bank of Angola, Angola First National Bank, Elkhart The National City Bank of Evansville, Evansville Old National Bank in Evansville, Evansville Gary National Bank, Gary American Fletcher National Bank and Trust Company, Indianapolis The Indiana National Bank, Indianapolis Merchants National Bank & Trust Company of Indianapolis, Indianapolis Midwest National Bank, Indianapolis The Peoples National Bank of Lawrenceburg, Lawrenceburg Citizens National Bank of Grant County, Marion First National Bank in Marion, Marion American National Bank and Trust Company of Muncie, Muncie The American National Bank of Noblesville, Noblesville The First National Bank of North Vernon, North Vernon The Farmers National Bank of Shelby ville, Shelby ville The Shelby National Bank, Shelbyville The National Bank and Trust Company of South Bend, South Bend The First National Bank of Spurgeon, Spurgeon Terre Haute First National Bank, Terre Haute The First National Bank in Wabash, Wabash The Peoples National Bank and Trust Company, Washington 8603 8725 13321 14746 16324 16197 3420 The Peoples National Bank of Albia, Albia Okey-Vernon First National Bank, Corning Central National Bank & Trust Company of Des Moines, Des Moines National Bank of Des Moines, Des Moines Valley National Bank, Des Moines Second National Bank, Eldora The Farmers National Bank of Webster City, Webster City 2758 11056 7285 6494 3885 13801 3849 15503 3475 4742 12490 The Exchange National Bank and Trust Company of Atchison, Atchison The American National Bank of Baxter Springs, Baxter Springs First National Bank in Dodge City, Dodge City First National Bank & Trust Company, El Dorado The First National Bank of Hays City, Hays Security National Bank of Kansas City, Kansas City The Lawrence National Bank and Trust Company, Lawrence City National Bank of Pittsburg, Pittsburg The National Bank of Pittsburg, Pittsburg The First National Bank and Trust Company of Salina, Salina The Fourth National Bank and Trust Company, Wichita, Wichita 9365 4260 6028 14894 2927 4271 2901 10254 109 14320 1831 14138 12961 The American National Bank and Trust Company of Bowling Green, Bowling Green The Citizens National Bank of Covington, Covington The First-Hardin National Bank of Elizabethtown, Elizabethtown Fort Knox National Bank, Fort Knox First National Bank and Trust Company, Georgetown The Farmers National Bank of Lebanon, Lebanon The Second National Bank and Trust Company of Lexington, Lexington Cumberland Valley National Bank & Trust Company, London First National Bank of Louisville, Louisville , Liberty National Bank and Trust Company of Louisville, Louisville The First National Bank and Trust Company, Nicholasville The Owensboro National Bank, Owensboro The Peoples First National Bank & Trust Company of Paducah, Paducah 5807 15338 14989 13732 14503 The First National Bank of Abbeville, Abbeville First National Bank of St. Bernard Parish, Arabi First National Bank, Covington First National Bank of Jefferson Parish, Gretna First National Bank of Houma, Houma IOWA KANSAS KENTUCKY LOUISIANA 205 TABLE B-19—Continued Domestic branches entering the National Banking System, by de novo opening, merger, or conversion, by States, calendar 1974 Charter No. Branches opened for business Title and location of bank Outside branches LOUISIANA—Continued 13851 13689 14477 14977 14685 First National Bank in St. Mary Parish, Morgan First National Bank of Commerce, New Orleans National American Bank of New Orleans, New Orleans Whitney National Bank of New Orleans, New Orleans First National Bank of West Monroe, West Monroe 498 1254 2260 941 4128 13768 Bank of Maine, N. A., Augusta The Ocean National Bank of Kennebunk, Kennebunk Northeast Bank N.A. of Lewiston and Auburn, Lewiston Canal National Bank, Portland Maine National Bank, Portland Northern National Bank, Presque Isle 15314 1244 1413 13745 381 15051 8606 13840 14564 15365 14937 15154 Aberdeen National Bank, Aberdeen The Farmers National Bank of Annapolis, Annapolis , The First National Bank of Maryland, Baltimore Maryland National Bank, Baltimore The First National Bank and Trust Company of Western Maryland, Cumberland The Central National Bank of Maryland, Hillandale The First National Bank of St. Mary's at Leonardtown, Leonardtown The Cecil National Bank at Port Deposit, Port Deposit State National Bank of Maryland, Rockville University National Bank, Rockville , American National Bank of Maryland, Silver Spring Peoples National Bank of Maryland, Suitland 1049 200 15509 4771 590 1320 2153 474 10059 7452 13241 383 1194 726 308 15005 79 Northeast National Bank, Amesbury The First National Bank of Boston, Boston The National Shawmut Bank of Boston, Boston The County Bank, N.A., Cambridge The Fall River National Bank, Fall River The Falmouth National Bank, Falmouth First Safety Fund National Bank, Fitchburg First National Bank of Franklin County, Greenfield Merchants National Bank of Leominster, Leominster Security National Bank, Lynn Needham National Bank, Needham Pioneer National Bank-Hampshire, Northampton Rockport National Bank, Rockport Merchants-Warren National Bank of Salem, Salem Third National Bank of Hampden County, Springfield Hampshire National Bank of South Hadley, South Hadley Worcester County National Bank, Worcester 15164 16185 14185 14641 16371 1924 16157 15801 14948 13671 15446 15575 15392 14062 14560 7676 14187 13741 Huron Valley National Bank, Ann Arbor The American National Bank in Battle Creek, Battle Creek Security National Bank of Battle Creek, Battle Creek Peoples National Bank & Trust Company of Bay City, Bay City Commercial National Bank, Cassopolis The Southern Michigan National Bank of Coldwater, Coldwater Michigan National Bank-Dearborn, Dearborn First Independence National Bank of Detroit, Detroit Michigan National Bank of Detroit, Detroit National Bank of Detroit, Detroit First National Bank of Fenton, Fenton Union Bank and Trust Company, National Association, Grand Rapids Grand Valley National Bank, Grandville Hillsdale County National Bank, Hillsdale First National Bank and Trust Company of Holland, Holland Houghton National Bank, Houghton The Ionia County National Bank of Ionia, Ionia The National Bank of Jackson, Jackson MAINE MARYLAND MASSACHUSETTS , MICHIGAN 206 , , , Total TABLE B-19—Continued Domestic branches entering the National Banking System, by de novo opening, merger, or conversion, by States, calendar 1974 Charter No. Title and location of bank Branches opened for business Local Outside branches Total MICHIGAN—Continued 13820 15444 14280 390 12697 3256 15899 13739 15274 3886 3378 15527 15167 15611 13807 The American National Bank and Trust Company of Michigan, Kalamazoo Michigan National Bank-West Metro, Livonia The First National Bank at Manistique, Manistique First National Bank & Trust Company of Marquette, Marquette The Dart National Bank of Mason, Mason The First National Bank of Menominee, Menominee West Oakland Bank, National Association, Novi Community National Bank of Pontiac, Pontiac National Bank of Rochester, Rochester The First National Bank of St. Ignace, St. Ignace Clinton National Bank and Trust Company, St. Johns, St. Johns Michigan National Bank-Oakland, Southfield National Bank of Southfield, Southfield First National Bank of Warren, Warren The National Bank of Ypsilanti, Ypsilanti 14949 11861 14805 16128 203 15659 Franklin National Bank of Minneapolis, Minneapolis The Marquette National Bank of Minneapolis, Minneapolis Zapp National Bank of St. Cloud, St. Cloud Shelard National Bank, St. Louis Park The First National Bank of Saint Paul, Saint Paul First National Bank of Wayzata, Wayzata 14487 5176 15539 15661 15516 15548 10523 11898 13551 13722 15672 9865 3656 16194 3430 12587 MISSISSIPPI Gulf National Bank, Gulfport First Mississippi National Bank, Hattiesburg Southern National Bank of Hattiesburg, Hattiesburg First National Bank, Hernando, Mississippi, Hernando Citizens National Bank, Jackson Deposit Guaranty National Bank, Jackson First National Bank of Jackson, Jackson The Commercial National Bank and Trust Company of Laurel, Laurel First National Bank in Meridian, Meridian Britton & Koontz First National Bank, Natchez First National Bank of Jackson County, Ocean Springs The First National Bank of Oxford, Oxford National Bank of Commerce of Mississippi, Starkville Peoples Bank of Mississippi, National Association, Union Merchants National Bank, Vicksburg, Mississippi, Vicksburg The Delta National Bank of Yazoo City, Yazoo City 4611 13162 11472 5973 6272 15176 4933 The First National Bank of Cape Girardeau, Cape Girardeau First National Bank and Trust Company of Joplin, Joplin Columbia Union National Bank and Trust Company, Kansas City. The First National Bank of Monett, Monett The American National Bank of St. Joseph, St. Joseph Belt National Bank of St. Joseph, St. Joseph The Trenton National Bank, Trenton 2357 8328 13408 2848 14340 The First National Bank & Trust Company of Beatrice, Beatrice First National Bank and Trust Company of Columbus, Columbus First National Bank & Trust Company of Fremont, Fremont The Fremont National Bank, Fremont The Commercial National Bank & Trust Company, Grand Island, Nebraska, Grand Island The First National Bank of Grand Island, Grand Island The Overland National Bank of Grand Island, Grand Island . First National Bank, Hastings, Hastings First National Bank & Trust Company of Lincoln, Lincoln .. The Delay First National Bank & Trust Company, Norfolk.. Northwestern National Bank of Norfolk, Norfolk The First National Bank of Omaha, Omaha The United States National Bank of Omaha, Omaha MINNESOTA MISSOURI NEBRASKA 2779 14018 13515 1798 13582 14339 209 2978 207 TABLE B-19—Continued Domestic branches entering the National Banking System, by de novo opening, merger, or conversion, by States, calendar 1974 Charter No. Title and location of bank Branches opened for business Local NEVADA 7038 First National Bank of Nevada, Reno, Nevada, Reno 15645 Nevada National Bank, Reno 14406 Security National Bank of Nevada, Reno NEW HAMPSHIRE 2443 4037 1070 15563 1179 The Franklin National Bank, Franklin Laconia Peoples National Bank and Trust Company, Laconia The Souhegan National Bank of Milford, Milford Indian Head National Bank of Nashua, Nashua First National Bank of Peterborough, Peterborough 12617 15913 9498 1222 13203 1209 12984 15709 15430 1326 1436 15570 399 16169 4147 374 16035 13127 1191 1113 15360 1452 1316 587 14240 12732 15835 11759 5005 12917 16129 13898 4365 329 1327 13125 14673 10440 12606 The Atco National Bank, Atco Shore National Bank, Brick Township The Farmers and Merchants National Bank of Bridgeton, Bridgeton First National State Bank/Mechanics, Burlington Township Third National Bank of New Jersey, Camden Heritage Bank National Association, Cherry Hill Friendly National Bank of New Jersey, Cinnaminson New Jersey Bank (National Association), Clifton Midlantic National Bank/Raritan Valley, Edison First National Bank of South Jersey, Egg Harbor Township The National State Bank, Elizabeth, N.J., Elizabeth Garden State National Bank, Hackensack First Peoples National Bank of New Jersey, Haddon Township The Hamilton Bank, National Association, Hamilton Township United Jersey Bank/Mid State, National Association, Hazlet The First Jersey National Bank, Jersey City First National State Bank of Ocean County, Lakewood Township Citizens Bank of Marlton, National Association, Marlton The Burlington County National Bank, Medford Heritage Bank National Association-Iron, Morristown Midlantic National Bank/Morris, Morristown First National State Bank of New Jersey, Newark Midlantic National Bank, Newark The National Bank of New Jersey, New Brunswick First National Bank in Newfield, Newfield Meadowlands National Bank, North Bergen Jefferson National Bank, Passaic Citizens First National Bank of New Jersey, Ridgewood National Community Bank of Rutherford, Rutherford The National Bank of Mantua, Sewell Suburban National/A United Jersey Bank, South Plainfield First National State Bank of the Jersey Coast, Spring Lake Midlantic National Bank/Citizens, Tenafly First National Bank of New Jersey, Totowa New Jersey National Bank, Trenton Citizens United Bank, N.A., Vineland City National Bank, Vineland Minotola National Bank, Vineland The Yardville National Bank, Yardville 12485 12924 8132 13438 Albuquerque National Bank, Albuquerque First National Bank in Raton, Raton The American National Bank of Silver City, Silver City Hot Springs National Bank, Truth or Consequences 5178 15758 16203 1301 963 1253 Community National Bank, Addison Bankers Trust Company of Albany, National Association, Albany Chase Manhattan Bank of Eastern New York (National Association), Albany National Commercial Bank and Trust Company, Albany Union National Bank, Albany Ballston Spa National Bank, Ballston Spa NEW JERSEY NEW MEXICO NEW YORK 208 Outside branches Total TABLE B-19—Continued Domestic branches entering the National Banking System, by de novo opening, merger, or conversion, by States, calendar 1974 Charter No. Title and location of bank Branches opened for business Outside branches 15917 10029 9669 13952 10258 15080 1122 8531 5816 11511 8847 13825 13126 2517 8613 6587 11087 15976 15626 13121 11897 598 15922 13956 13314 1106 2370 15558 1461 7703 15569 1354 14734 1887 1090 2151 16089 15641 10781 4230 16050 1040 1226 10258 14763 16047 721 8158 10525 9990 15968 NEW YORK—Continued Citibank (Suffolk), National Association, Bay Shore Manufacturers Hanover Trust Company/Suffolk, National Association, Bay Shore . . . The Bridgehampton National Bank, Bridgehampton Chase Manhattan Bank of Western New York (National Association), Buffalo Citibank (Western), National Association, Buffalo Liberty National Bank and Trust Company, Buffalo Central National Bank, Canajoharie, Canajoharie The St. Lawrence National Bank, Canton Citibank (Eastern), National Association, Castleton-on-Hudson Marine Midland Tinker National Bank, East Setauket Deak National Bank, Fleischmanns The National Bank of Florida, Florida The First National Bank of Glen Head, Glen Head Chemical Bank-Eastern, National Association, Greenwich The First National Bank of Hancock, Hancock Security National Bank, Hempstead Long Island National Bank, Hicksville Citibank (Mid-Western), National Association, Honeoye Falls The First National Bank of Jamestown, Jamestown The Mahopac National Bank, Mahopac The Citizens National Bank of Malone, Malone The Farmers National Bank of Malone, Malone Chase Manhattan Bank of Long Island (National Association), Melville Empire National Bank, Middletown Nanute National Bank, Nanute Highland National Bank of Newburgh, Newburgh The Chase Manhattan Bank (National Association), New York Community National Bank and Trust Company of New York, New York (Staten Island) First National City Bank, New York National Bank of North America, New York Republic National Bank of New York, New York The National Bank and Trust Company of Norwich, Norwich Chemical Bank Hudson Valley, N.A., Nyack The First National Bank of Olean, Olean The Oneida Valley National Bank of Oneida, Oneida Wilber National Bank, Oneonta Citibank (Central), National Association, Oriskany Falls Bankers Trust Hudson Valley, National Association, Poughkeepsie The Red Creek National Bank, Red Creek The Suffolk County National Bank of Riverhead, Riverhead Chase Manhattan Bank of Greater Rochester, National Association, Rochester Chase Manhattan Bank of Mid-Hudson (National Association), Saugerties The Mohawk National Bank of Schenectady, Schenectady Citibank (Western), National Association, Silver Creek Chemical Bank of Suffolk, National Association, Smithtown Chase Manhattan Bank of Central New York, National Association, Syracuse Marine Midland Bank-Eastern National Association, Troy Seaway National Bank, Watertown National Bank of Westchester, White Plains Citibank (Mid-Hudson), National Association, Woodbury Hudson Valley National Bank, Yonkers 11091 15650 13761 14481 13779 4597 14676 6744 10610 13859 10608 16114 15673 The First National Bank of Albermarle, Albemarle First Union National Bank of North Carolina, Charlotte North Carolina National Bank, Charlotte Citizens National Bank of Concord, Concord The Citizens National Bank in Gastonia, Gastonia First National Bank of Catawba County, Hickory Bank of North Carolina, National Association, Jacksonville Carolina First National Bank, Lincolnton Southern National Bank of North Carolina, Lumberton The Union National Bank of Oxford, Oxford The Planters National Bank and Trust Company, Rocky Mount Columbus National Bank, Whiteville Wachovia Bank and Trust Company, N.A., Winston-Salem 0 0 1 0 0 0 0 0 0 0 0 0 0 0 0 1 0 0 1 0 1 0 0 0 0 1 5 0 11 2 14 0 0 1 0 1 0 1 0 1 0 0 0 0 0 1 1 0 0 0 1 2 5 0 3 3 4 1 3 3 2 1 1 1 1 1 4 1 4 0 1 0 2 2 1 1 0 4 1 3 10 4 1 1 0 1 0 3 2 1 0 2 4 1 1 2 1 1 1 2 6 0 1 1 2 0 1 1 1 0 0 1 0 1 1 0 5 8 1 1 0 1 1 2 0 3 0 14 Total NORTH CAROLINA 209 TABLE B-19—Continued Domestic branches entering the National Banking System, by de novo opening, merger, or conversion, by States, calendar 1974 Charter No. Branches opened for business Title and location of bank Total Outside branches NORTH DAKOTA 2434 5087 2377 13790 13357 6429 The First National Bank and Trust Company of Bismarck, Bismarck The Fargo National Bank & Trust Company, Fargo The First National Bank and Trust Company of Fargo, Fargo First National Bank in Grand Forks, Grand Forks Red River National Bank and Trust Company of Grand Forks, Grand Forks First National Bank in Minot, Minot 15609 14579 5075 3274 6249 14501 15423 4318 786 7621 7745 5065 13923 10 2604 14968 15591 5996 56 829 6938 2360 1064 15456 2036 2577 4^42 3234 9179 15416 14686 13832 1989 14105 5828 3157 2479 Akron National Bank and Trust Company, Akron First National Bank of Akron, Akron The Northeastern Ohio National Bank, Ashtabula The Second National Bank of Bucyrus, Bucyrus The First National Bank of Burton, Burton The United National Bank & Trust Company, Canton The Capital National Bank, Cleveland Central National Bank of Cleveland, Cleveland National City Bank, Cleveland The City National Bank & Trust Company of Columbus, Columbus The Huntington National Bank of Columbus, Columbus The Ohio National Bank of Columbus, Columbus Coshocton National Bank, Coshocton Third National Bank and Trust Company of Dayton, Ohio, Dayton Winters National Bank and Trust Co., Dayton First National Bank of Elyria, Elyria Tri-County National Bank, Fostoria People's National Bank, Georgetown The First National Bank and Trust Company of Hamilton, Hamilton The Second National Bank of Hamilton, Hamilton Harrison County National Bank, Hopedale The Lebanon-Citizens National Bank, Lebanon The First National Bank of London, London The Central Security National Bank of Lorain County, Lorain The Vinton County National Bank of McArthur, McArthur First National Bank of Mansfield, Mansfield The Old Phoenix National Bank of Medina, Medina Clermont National Bank, Milford The Park National Bank, Newark Mid-American National Bank and Trust Company, North Wood The Lake County National Bank of Painesville, Painesville The National Bank of Portsmouth, Portsmouth The Quaker City National Bank, Quaker City Lagonda National Bank of Springfield, Springfield The First National Bank of Wadsworth, Wadsworth The First National Bank of Wapakoneta, Wapakoneta The Second National Bank of Warren, Warren , 1 0 1 1 1 1 0 1 0 0 0 0 3 1 0 1 0 0 0 0 0 2 2 1 1 0 1 1 1 0 0 0 0 1 0 0 0 0 0 0 0 0 0 0 0 1 0 1 0 1 0 1 0 1 1 1 1 3 0 2 1 0 1 0 0 0 1 1 1 2 0 1 1 1 1 1 1 1 1 1 1 1 0 1 0 1 1 1 1 0 0 0 0 0 2 6 1 2 0 0 0 0 0 0 0 2 0 4 2 84 1 1 1 1 OHIO , , , OKLAHOMA 6258 First National Bank in Bartlesville, Bartlesville 13751 The Citizens National Bank & Trust Company, Okmulgee, Oklahoma, Okmulgee 15750 National Bank of Sallisaw, Sallisaw OREGON 1553 First National Bank of Oregon, Portland 4514 United States National Bank of Oregon, Portland PENNSYLVANIA 373 6645 539 723 1 10128 5307 8421 2137 210 The First National Bank of Allentown, Allentown The Merchants National Bank of Allentown, Allentown The Philadelphia National Bank, Ardmore Central Penn National Bank, Bala-Cynwyd First Pennsylvania Bank N.A., Bala-Cynwyd The Kishacquillas Valley National Bank of Belleville, Belleville First National Bank of Western Pennsylvania, Berlin The Blue Ball National Bank, Blue Ball The National Bank of Boyertown, Boyertown TABLE B-19—Continued Domestic branches entering the National Banking System, by de novo opening, merger, or conversion, by States, calendar 1974 Charter No. Title and location of bank Branches opened for business Local Outside branches Total PENNSYLVANIA—Continued 15422 355 661 5019 9868 1233 5118 2515 8854 7702 580 644 31 4965 14098 252 6158 13781 2634 694 680 3147 912 11244 5599 12 870 9511 562 14542 2222 6301 252 649 1663 2366 13947 6483 2333 12261 1237 4984 4355 5034 30 14344 732 175 14082 5184 Provident National Bank, Bryn Mawr Southeast National Bank of Pennsylvania, Chester The Downingtown National Bank, Downingtown Deposit National Bank, DuBois The First National Bank of Dunmore, Dunmore Easton National Bank and Trust Company, Easton The Northampton National Bank of Easton, Easton The Ephrata National Bank, Ephrata The Citizens National Bank of Evans City, Evans City Peoples National Bank of Susquehanna County, Hallstead The Commonwealth National Bank, Harrisburg The Honesdale National Bank, Honesdale Penn Central National Bank, Huntingdon Union National Bank & Trust Company of Huntingdon, Huntingdon National Bank of the Commonwealth, Indiana Pittsburgh National Bank, Jeannette The First National Bank of Jermyn, Jermyn United States National Bank in Johnstown, Johnstown The Fulton National Bank of Lancaster, Lancaster National Central Bank, Lancaster Lebanon Valley National Bank, Lebanon The National Bank of Malvern, Malvern The Manheim National Bank, Manheim The First National Bank of Mapleton, Mapleton The Mars National Bank, Mars The First National Bank of Pennsylvania, Meadville Marine National Bank, Meadville The Farmers National Bank and Trust Company of Millheim, Millheim . . . . First National Bank of Lawrence County at New Castle, New Castle Cumberland County National Bank and Trust Company, New Cumberland Equibank N.A., Pittsburgh Mellon Bank, N.A., Pittsburgh Pittsburgh National Bank, Pittsburgh The Miners National Bank of Pottsville, Pottsville Pennsylvania National Bank and Trust Company, Pottsville The Quakertown National Bank, Quakertown Scranton National Bank, Scranton The First National Bank of Slippery Rock, Slippery Rock Union National Bank and Trust Company of Souderton, Souderton The Peoples National Bank of Central Pennsylvania, State College First National Trust Bank, Sunbury The First National Bank of Troy, Troy First Blair County National Bank of Tyrone, Tyrone Gallatin National Bank, Uniontown First Eastern Bank, National Association, Wilkes-Barre The Hanover National Bank of Wilkes-Barre, Wilkes-Barre The Wyoming National Bank of Wilkes-Barre, Wilkes-Barre Fidelity National Bank of Pa., Williamsport Citizens National Bank in Windber, Windber Southern Pennsylvania National Bank, York 14425 2044 10635 13720 15134 10085 13918 10660 The Citizens and Southern National Bank of South Carolina, Charleston The South Carolina National Bank, Charleston Bankers Trust of South Carolina, N.A., Columbia First National Bank of South Carolina, Columbia Horry County National Bank, Loris Marion National Bank, Marion First National Bank in Orangeburg, Orangeburg The National Bank of South Carolina, Sumter 3326 2980 15639 10592 Aberdeen National Bank, Aberdeen First National Bank of Aberdeen, Aberdeen United National Bank, Rapid City Northwestern National Bank of Sioux Falls, Sioux Falls 0 0 0 0 1 0 0 0 1 0 0 1 0 0 1 0 0 0 1 1 0 0 0 0 0 0 0 0 0 0 0 0 0 1 0 1 1 0 0 0 0 0 1 0 0 0 0 1 0 3 1 1 1 0 1 1 1 1 1 6 0 1 1 2 5 1 1 1 2 1 1 1 1 1 2 1 1 1 3 1 2 2 0 3 0 0 1 1 0 2 1 1 0 1 1 1 3 0 1 0 1 0 0 0 1 0 0 7 3 8 7 1 0 1 4 1 0 0 1 0 1 1 0 1 SOUTH CAROLINA SOUTH DAKOTA 211 TABLE B-19—Continued Domestic branches entering the National Banking System, by de novo opening, merger, or conversion, by States, calendar 1974 Charter No. Title and location of bank TENNESSEE 14611 9027 6930 13948 8443 14657 2049 12080 336 13681 14736 3032 13103 14828 16076 3530 16410 American National Bank and Trust Company of Chattanooga, Chattanooga . Hamilton National Bank of Polk County, Copperhill The First National Bank of Dickson, Dickson Union National Bank of Fayetteville, Fayetteville The Harpeth National Bank of Franklin, Franklin First Tennessee National Bank, Kingsport Park National Bank of Knoxville, Knoxville Hamilton National Bank of Loudon, Loudon The First National Bank of Memphis, Memphis National Bank of Commerce, Memphis The National Bank of Murfreesboro, Murfreesboro First American National Bank of Nashville, Nashville Third National Bank in Nashville, Nashville National Bank of Newport, Newport Citizens National Bank, Sevierville The Peoples National Bank of Shelbyville, Shelbyville First Tennessee National Bank, White's Creek UTAH 2597 First Security Bank of Utah, National Association, Ogden 4341 Zions First National Bank, Salt Lake City VERMONT 7267 1430 1197 3080 1195 194 2274 122 3484 1133 The Bradford National Bank, Bradford Vermont National Bank, Brattleboro The Merchants National Bank of Burlington, Burlington The Factory Point National Bank of Manchester Center, Manchester Center The National Bank of Middlebury, Middlebury Catamount National Bank, North Bennington The Randolph National Bank, Randolph First National Bank of Springfield, Springfield The First National Bank of White River Junction, White River Junction The Woodstock National Bank, Woodstock VIRGINIA 14904 11976 16246 12229 16184 6389 1582 16313 12267 11694 15315 6206 1558 15819 14904 5032 7026 15139 10524 10194 9885 11381 6782 1111 15530 15027 11817 2737 11569 1824 14824 10973 212 Branches opened for business Local Dominion National Bank, Baileys Cross Roads The First National Bank of Bassett, Bassett The First National Exchange Bank of Montgomery County, Blacksburg The National Bank of Blacksburg, Blacksburg First & Merchants National Bank of Tidewater, Chesapeake The National Bank of Fairfax, Fairfax County The National Bank of Fredericksburg, Fredericksburg Fidelity National Bank, Halifax County The Old Point National Bank of Phoebus, Hampton Valley National Bank, Harrisonburg Fairfield National Bank, Highland Springs The Page Valley National Bank of Luray, Luray United Virginia Bank/First National, Lynchburg Virginia National Bank/Lynchburg, Lynchburg Dominion National Bank, P.O. McLean First Virginia Bank-Manassas National, Manassas The First National Bank of Martinsville and Henry County, Martinsville The First National Bank, Narrows Citizens National Bank, New Market United Virginia Bank/Seaboard National, Norfolk Virginia National Bank, Norfolk American National Bank, Portsmouth The First and Merchants National Bank of Radford, Radford First & Merchants National Bank, Richmond Metropolitan National Bank, Richmond Richmond National Bank, Richmond Colonial-American National Bank, Roanoke The First National Exchange Bank of Virginia, Roanoke The Round Hill National Bank, Round Hill The Farmers National Bank of Salem, Salem Fairfax County National Bank, Seven Corners The Farmers & Merchants National Bank of Stanley, Stanley Outside branches Total TABLE B-19—Continued Domestic branches entering the National Banking System, by de novo opening, merger, or conversion, by States, calendar 1974 Charter No. Title and location of bank Branches opened for business Outside Total Local branches VIRGINIA—Continued 1620 United Virginia Bank/National Valley, Staunton 651 United Virginia Bank/National, Vienna 6084 Farmers and Merchants National Bank, Winchester 15984 First & Merchants National Bank of the Peninsula, York County 0 10 1 1 1 10 1 1 WASHINGTON 13351 3417 11280 4668 The First American National Bank of Port Townsend, Port Townsend Pacific National Bank of Washington, Seattle Seattle-First National Bank, Seattle Old National Bank of Washington, Spokane 16002 4643 7681 13811 16097 7998 10480 15406 8983 Raleigh County National Bank, Beckley The First National Bank of Bluefield, Bluefield The Union National Bank of Clarksburg, Clarksburg First National Bank in Fairmont, Fairmont Citizens National Bank of Follansbee, Follansbee The National Bank of Summers of Hinton, Hinton Albright National Bank of Kingwood, Kingwood First National Bank of West Hamlin, West Hamlin The First National Bank and Trust Company of Wheeling, Wheeling . 14397 2125 12124 1602 13086 3936 The The The The The The WEST VIRGINIA WISCONSIN Baraboo National Bank, Baraboo First National Bank of Chippewa Falls, Chippewa Falls First National Bank of Eagle River, Eagle River First National Bank of Neenah, Neenah Oshkosh National Bank, Oshkosh First National Bank of the City of Superior, Superior 213 TABLE B-20 Domestic branches of National banks closed, by States, calendar 1974 Charter No. Branches closed Title and location of bank Outside branches Local Total Total 60 317 377 1 0 1 1 1 0 1 1 1 0 0 0 0 1 0 0 1 2 3 2 1 0 4 9 1 2 2 3 2 1 1 4 9 1 o 4 4 1 1 0 0 1 1 1 1 0 1 1 0 0 1 1 1 1 o 2 2 o 1 0 1 1 1 1 0 0 0 1 0 1 2 1 0 1 1 2 1 1 2 0 1 1 1 0 3 1 1 o 1 0 6 1 6 1 0 1 o 1 1 1 0 1 ALABAMA 3041 The First National Bank of Anniston Anniston 11846 The First National Bank of Russellville Russellville o ARIZONA 3728 First National Bank of Arizona, Phoenix CALIFORNIA 13348 15557 2491 15174 15349 3050 13044 1741 15660 Beverly Hills National Bank, Beverly Hills Imperial Valley National Bank, El Centro Security Pacific National Bank, Los Angeles Sierra National Bank, Petaluma Valley National Bank, Salinas First National Bank, San Diego Bank of America National Trust and Savings Association, San Francisco Crocker National Bank, San Francisco Wells Fargo Bank, National Association, San Francisco o CONNECTICUT 1314 The Clinton National Bank, Clinton GEORGIA 9617 The Fulton National Bank of Atlanta, Atlanta 15148 First National Bank of Newton County, Covington . . . . .. ILLINOIS 5638 The First National Bank of Dundee Dundee 14372 First National Bank in Harvey Harvey . . o INDIANA 206 The First National Bank, Elkhart 869 Merchants National Bank and Trust Company of Indianapolis, Indianapolis IOWA 15524 First National Bank of Eldora Eldora KENTUCKY 718 The First National Bank and Trust Company of Covington, Covington 14320 Liberty National Bank and Trust Company of Louisville Louisville MASSACHUSETTS 15509 2504 13222 5944 2108 The National Shawmut Bank of Boston, Boston First County National Bank, Brockton . . . . The Buzzards Bay National Bank, Buzzards Bay United National Bank, North Attleboro The Union Market National Bank of Watertown, Watertown . MICHIGAN 13671 National Bank of Detroit, Detroit 13820 The American National Bank and Trust Company of Michigan, Kalamazoo 15167 National Bank of Southfield, Southfield MISSISSIPPI 15559 First National Bank of Greenwood Greenwood 5176 First Mississippi National Bank Hattiesburg MISSOURI 6272 The American National Bank of St. Joseph, St. Joseph NEW JERSEY 4365 Midlantic National Bank/Citizens, Tenafly NEW MEXICO 14081 The First National Bank in Tucumcari, Tucumcari 214 TABLE B-20—Continued Domestic branches of National banks closed, by States, calendar 1974 Charter No. Branches closed Title and location of bank Local Outside branches Total NEW YORK 12997 13956 13955 2370 1461 7703 465 Franklin National Bank, Brooklyn Empire National Bank, Middletown First Westchester National Bank, New Rochelle The Chase Manhattan Bank (National Association), New York First National City Bank, New York National Bank of North America, New York Marine Midland Bank of Southeastern New York, N.A., Poughkeepsie .. 15650 13761 14676 10610 10608 15673 First Union National Bank of North Carolina, Charlotte North Carolina National Bank, Charlotte Bank of North Carolina, National Association, Jacksonville Southern National Bank of North Carolina, Lumberton The Planters National Bank and Trust Company, Rocky Mount Wachovia Bank and Trust Company, N.A., Winston-Salem 100 1 11 0 0 2 1 NORTH CAROLINA NORTH DAKOTA 2377 The First National Bank and Trust Company, Fargo 13790 First National Bank in Grand Forks, Grand Forks OKLAHOMA 15350 Republic National Bank of Tulsa, Tulsa 247 1 13868 15422 4923 2634 5773 2222 6301 705 478 77 5184 The First National Bank of Altoona, Altoona First Pennsylvania Bank N.A., Bala-Cynwyd Blairsville National Bank, Blairsville Provident National Bank, Bryn Mawr The Farmers National Bank of Ephrata, Ephrata The Fulton National Bank of Lancaster, Lancaster Farmers First National Bank, Lititz Equibank N.A., Pittsburgh Mellon Bank, N.A., Pittsburgh The Union National Bank of Pittsburgh, Pittsburgh The First National Bank of Pittston, Pittston Northeastern Pennsylvania National Bank and Trust Company, Scranton Southern Pennsylvania National Bank, York PENNSYLVANIA 5 1 0 1 0 15 9 2 0 1 1 10 6 SOUTH CAROLINA 10635 Bankers Trust of South Carolina, N.A., Columbia 13720 First National Bank of South Carolina, Columbia 80 0 VERMONT 13755 National White River Bank in Bethel, Bethel 1197 The Merchants National Bank of Burlington, Burlington VIRGINIA 14904 1522 Dominion National Bank, Baileys Cross Roads 15315 The Fidelity National Bank, Lynchburg 11817 Fairfield National Bank of Highland Springs, Richmond 2737 Colonial-American National Bank, Roanoke The First National Exchange Bank of Virginia, Roanoke VIRGIN ISLANDS 14335 Virgin Islands National Bank, St. Thomas WASHINGTON 15223 Valley National Bank of Auburn, Auburn 14502 Guaranty National Bank of White Center, White Center WISCONSIN 2125 The First National Bank of Chippewa Falls, Chippewa Falls 6604 First Wisconsin National Bank of Oshkosh, Oshkosh 215 to TABLE B-21 Principal assets, liabilities, and capital accounts of National banks, by deposit size, year-end 1973 and 1974 [Dollar amounts in millions] Deposits Securities* Number of banks Total assets Cash and cash items Loans * Total U.S. Treasury securities Fixed assets Total Demand Time and savings Capital stock Capital notes and debentures Surplus, undivided profits, and 1974 Deposit size Less than $1.0.. $1.0 to $1.9 . . . . $2.0 to $4.9 . . . . $5.0 to $9.9 . . . . $10.0 to $24.9 .. $25.0 to $49.9 .. $50.0 to $99.9 .. $100.0 to $499.9 $500.0 and over. Total 20 54 360 743 1,666 888 490 369 118 35 120 1,575 6,387 30,980 35,590 38,858 91,221 329,656 5 18 212 776 3,563 4,158 4,981 13,758 49,086 6 42 693 3,052 15,626 18,584 20,619 48,426 190,803 8 27 448 1,922 9,248 10,022 10,383 21,045 53,898 7 16 201 689 2,784 2,622 2,550 5,164 13,408 3 6 39 115 550 678 785 1,827 5,048 13 84 1,344 5,640 27,466 31,177 33,767 76,712 255,022 8 49 625 2,403 10,793 12,066 13,162 33,171 108,114 5 35 719 3,238 16,673 19,111 20,605 43,541 146,907 11 15 61 138 525 641 669 1,584 4,706 0 0 1 7 53 85 126 369 1,618 10 19 133 426 1,829 1,944 1,996 4,449 14,419 4,708 534,422 76,557 297,851 107,001 27,441 9,051 431,225 180,391 250,834 8,350 2,259 25,225 15 51 371 799 1,659 847 457 348 114 20 104 1,572 6,743 30,249 33,865 36,140 87,337 293,570 4 17 201 826 3,571 4,054 4,648 12,977 44,426 3 34 686 3,192 15,060 17,750 19,041 46,568 169,238 5 26 468 2,090 9,359 9,792 9,874 20,454 52,616 4 17 242 864 3,243 2,948 2,801 5,659 13,119 1 4 31 106 503 598 699 1,580 4,621 9 81 1,360 5,997 26,985 29,830 31,637 73,692 226,289 6 50 645 2,726 11,168 12,133 13,111 33,476 105,731 3 32 715 3,271 15,817 17,697 18,526 40,216 120,558 5 8 52 131 506 590 627 1,502 4,519 0 0 1 6 45 86 111 420 1,531 5 13 124 427 1,713 1,770 1,805 4,087 13,051 4,661 489,600 70,724 271,572 104,684 28,897 8,143 395,880 179,046 216,835 7,940 2,200 22,995 1973 Deposit size Less than $1.0.. $1.0 to $1.9 . . . . $2.0 to $4.9 . . . . $5.0 to $9.9 . . . . $10.0 to $24.9 .. $25.0 to $49.9 .. $50.0 to $99.9 .. $100.0 to $499.9 $500.0 and over. Total * Loans and securities figures are shown gross, that is, reserves are not deducted from the respective assets. NOTE: Data may not add to totals because of rounding. TABLE B-22 Dates of reports of condition of National banks, 1914—1974 [For dates of previous calls see Annual Report for 1920, vol. 2, Table no. 42, p. 150] Year Jan. 1914 1915 1916 1917 1918 1919 1920 1921 1922 1923 1924 1925 1926 1927 1928 1929 1930 1931 1932 1933 1934 1935 1936 1937 1938 1939 1940 1941 1942 1943 1944 1945 1946 1947 1948 1949 1950 1951 1952 1953 1954 1955 1956 1957 1958 1959 I960 1961 1962 1963 1964 .... 1965 1966 1967 1968 1969 1970 1971 1972 1973 1974 Feb. Mar. Apr. 4 4 7 5 4 4 13 28 21 June 1 1 1 10 12 4 28 10 May 3 31 6 12 23 28 27 27 25 5 4 4 31 7 29 26 4 4 13 20 12 11 24 9 31 20 15 11 10 14 4 12 15 12 26 18 15 26 5 25 18 30 30 20 18 28 24 5 30 23 30 20 29 30 30 30 30 30 30 30 30 30 30 29 30 30 30 30 30 29 30 30 30 30 29 30 30 30 30 30 29 30 30 30 30 30 30 30 30 30 30 6 23 10 15 30 30 29 30 30 30 30 29 30 30 30 30 30 30 July Aug. Sept. 12 2 12 11 Oct. Nov. Dec. 31 10 17 20 1 17 15 31 12 8 6 15 14 10 28 10 3 4 24 29 30 25 17 1 28 2 24 18 30 6 1 5 30 26 4 10 7 5 11 24 6 3 27 28 30 1 13 20 4 30 21 28 30 10 17 15 31 31 27 31 31 31 29 31 29 31 31 31 31 31 31 31 31 31 31 30 31 31 31 31 31 30 31 31 31 31 30 31 31 31 31 31 30 31 31 31 31 31 31 31 31 31 31 30 28 20 31 31 31 30 31 31 31 31 31 31 31 See notes on next page. 217 NOTES Act of Feb. 25, 1863, provided for reports of condition on the 1st of each quarter before commencement of business. Act of June 3, 1864—1st Monday of January, April, July, and October, before commencement of business, on form prescribed by Comptroller (in addition to reports on 1st Tuesday of each month showing condition at commencement of business in respect to certain items; i.e., loans, specie, deposits, and circulation). Act of Mar. 3, 1869, not less than 5 reports per year, on form prescribed by Comptroller, at close of business on any past date by him specified. Act of Dec. 28, 1922, minimum number of calls reduced from 5 to 3 per year. Act of Feb. 25, 1927, authorized a vice president or an assistant cashier designated by the board of directors to verify reports of condition in absence of president and cashier. Act of June 16, 1933, requires each National bank to furnish and publish not less than 3 reports each year of affiliates other than member banks, as of dates identical with those for which the Comptroller shall during such year require reports of condition of the bank. The report of each affiliate shall contain such information as in the judgment of the Comptroller shall be necessary to disclose fully the relations between the affiliate and the bank and to enable the Comptroller to inform himself as to the effect of such relations upon the affairs of the bank. Sec. 21 (a) of the Banking Act of 1933 provided, in part, that after June 16, 1934, it would he unlawful for any private bank not 218 under State supervision to continue the transaction of business unless it submitted to periodic examination by the Comptroller of the Currency or the Federal Reserve bank of the district, and made and published periodic reports of condition the same as required of National banks under sec. 5211, ILS.R.S. Sec. 21(a) of the Banking Act of 1933, however, was amended by sec. 303 of the Banking Act of 1935, approved Aug. 23, 1935, under the provisions of which private banks are no longer required to submit to examination by the Comptroller or Federal Reserve bank, nor are they required to make to the Comptroller and to publish periodic reports of condition. (Five calls for reports of condition of private banks were made by the Comptroller, the first one for June 30, 1934, and the last one for June 29, 1935.) Sec. 7(a)(3) of the Federal Deposit Insurance Act (Title 12, U.S.C., sec. 1817(a)) of July 14, 1960, provides, in part that, effective Jan. 1, 1961, each insured National bank shall make to the Comptroller of the Currency 4 reports of condition annually upon dates to be selected by the Comptroller, the Chairman of the Board of Governors of the Federal Reserve System, and the Chairman of the Board of Directors of the Federal Deposit Insurance Corporation, or a majority thereof. Two dates shall be selected within the semiannual period of January to June, inclusive, and 2 within the semiannual period of July to December, inclusive. Sec. 161 of Title 12 also provides that the Comptroller of the Currency may call for additional reports of condition, in such form and containing such information as he may prescribe, on dates to be fixed by him, and may call for special reports from any particular association whenever in his judgment the same are necessary for use in the performance of his supervisory duties. TABLE B-23 Total and principal assets of National banks, by States, June 30, 1974 [Dollar amounts in millions] Number of banks Total assets Cash assets* Securities, gross"t U.S. Government obligations^ State and local Other Loans, gross Federal funds sold§ United States 4,695 $516,770 $73,719 $43,843 $57,396 $3,437 $293,362 $20,408 Alabama Alaska Arizona Arkansas California Colorado Connecticut Delaware District of Columbia Florida Georgia Hawaii Idaho Illinois Indiana Iowa Kansas Kentucky Louisiana Maine Maryland Massachusetts Michigan Minnesota Mississippi Missouri Montana Nebraska Nevada New Hampshire New Jersey New Mexico New York North Carolina North Dakota Ohio Oklahoma Oregon Pennsylvania Rhode Island South Carolina South Dakota Tennessee Texas Utah Vermont Virginia Washington West Virginia Wisconsin Wyoming Virgin Islands Puerto Rico 93 5 3 74 57 126 24 5 13 274 5,855 800 4,822 3,300 71,654 748 110 555 457 10,037 875 603 75 383 353 908 146 444 413 5,432 21 3 13 13 163 24 114 250 2,771 202 68 3 170 823 64 2 6 7,766 3,215 405 3,042 1,702 42,854 3,213 2,178 31 1,535 8,248 4,712 77 1,270 28,129 5,953 1,901 1,973 2,091 3,221 District of Columbia - allf . . . 5,632 3,723 54 2,765 16,470 139 726 4 409 2,250 1,232 21 2,066 263 46,069 11,349 5,177 1,649 537 419 121 99 171 80 52 19 40 78 113 202 42 106 54 122 4 48 126 34 154 24 43 217 193 8 259 5 19 32 74 560 11 21 106 24 98 127 42 1 1 16 4,123 3,633 4,166 3,968 567 6,645 867 1,031 4,342 12,269 18,795 10,612 2,853 8,809 1,490 3,937 1,270 1,002 15,671 1,864 73,917 9,380 1,244 19,457 7,111 5,186 35,947 2,632 3,008 1,606 8,574 32,910 1,566 455 8,710 114 494 8,644 3,138 7,282 1,046 113 25 514 2,056 3,069 1,267 414 1,413 142 513 141 113 1,725 228 14,657 1,371 127 2,154 1,022 761 4,192 258 477 159 1,182 5,010 257 38 970 1,073 317 878 110 10 5,958 398 199 11 253 1,641 268 25 154 4,621 1,238 450 578 462 863 55 320 732 1,549 1,169 279 690 165 380 128 105 1,580 195 4,433 591 186 2,101 739 377 2,928 176 218 170 831 678 374 2 282 2,810 690 6 239 4,676 1,335 427 547 455 847 159 493 1,149 2,167 1,193 362 6 126 1 2 1,219 224 477 156 106 2,495 242 5,557 1,235 183 2,927 1,199 660 4,246 227 322 237 936 4,997 135 59 1,075 855 489 745 155 1 1 614 432 447 2,653 111 30 651 536 469 636 267 19 22 19 130 92 5 463 135 12 15 9 22 4 24 66 156 91 12 21 4 13 6 2 262 4 580 34 2 220 37 12 252 8 6 5 66 149 4 3 27 24 18 56 5 26 638 2,687 7,098 10,742 6,117 1,596 4,437 890 2,216 769 619 8,571 1,022 42,676 5,516 704 10,536 3,380 2,889 20,525 1,846 1,700 971 4,959 16,406 956 302 5,438 4,992 1,459 4,258 587 93 15 2,254 Direct lease financing 280 5 68 1,237 608 195 351 271 572 25 180 411 512 402 92 734 21 225 14 27 413 112 828 217 8 731 497 144 2,212 1 180 16 195 2,436 44 12 201 653 287 375 26 3 1 216 * Cash, balances with other banks, and cash items in process of collection. t Includes investment securities and securities held in trading accounts. $ Includes U.S. Treasury securities and obligations of other U.S. Government agencies. § Also includes securities purchased under agreements to resell. \\ Includes national and non-National banks in the District of Columbia, all of which are supervised by the Comptroller of the Currency. NOTE: Data may not add to totals because of rounding. Dashes indicate amounts of less than $500,000. 219 TABLE B-24 Total and principal liabilities of National banks, by States, June 30, 1974 [Dollar amounts in millions ] Deposits Total liabilities Total deposits Demand deposits, total Time and Demand deposits savings IPC* deposits, total Time deposits IPC* Reserves Federal on loans funds and purchased^ securities United States $476,967 $408,035 $171,102 $236,933 $128,221 $199,005 $41,808 Alabama Alaska Arizona Arkansas California Colorado Connecticut Delaware District of Columbia Florida Georgia Hawaii Idaho Illinois Indiana Iowa Kansas Kentucky Louisiana Maine Maryland Massachusetts Michigan Minnesota Mississippi Missouri Montana Nebraska Nevada New Hampshire New Jersey New Mexico New York North Carolina North Dakota Ohio Oklahoma Oregon Pennsylvania Rhode Island South Carolina South Dakota Tennessee Texas Utah Vermont Virginia Washington West Virginia Wisconsin Wyoming Virgin Islands Puerto Rico 5,353 741 4,499 3,026 67,215 5,198 3,441 49 2,518 15,130 7,115 130 1,920 42,746 10,543 3,353 3,781 3,662 6,106 947 3,993 11,255 17,341 9,799 2,628 8,087 1,381 3,616 1,168 899 14,396 1,718 67,786 8,638 1,147 17,806 6,504 4,755 33,029 2,431 2,765 1,481 7,926 30,297 1,442 417 8,008 8,084 2,874 6,737 959 104 23 4,932 695 3,859 2,732 57,246 4,580 3,120 47 2,319 13,661 5,628 128 1,767 34,924 8,849 3,014 3,418 3,369 5,253 872 3,526 9,778 15,612 7,898 2,463 6,487 1,274 3,245 1,114 832 13,492 1,610 55,263 7,170 1,051 15,700 5,887 4,169 27,156 2,152 2,433 1,411 6,744 26,218 1,275 405 7,269 6,588 2,528 5,845 905 98 22 2,149 350 1,406 1,284 19,943 2,144 1,655 18 1,327 6,076 2,913 54 674 12,186 3,670 1,311 1,589 1,596 2,358 359 1,610 5,012 5,780 3,030 1,118 3,259 433 1,442 463 424 5,189 678 28,011 3,076 386 6,095 2,668 1,769 9,979 685 1,479 470 2,817 12,797 505 122 2,688 2,692 981 2,021 339 20 4 2,783 344 2,452 1,44S 37,302 2,436 1,465 30 992 7,585 2,715 74 1,093 22,738 5,179 1,703 1,829 1,773 2,894 513 1,916 4,767 9,833 4,869 1,345 3,229 841 1,803 651 407 8,303 932 27,252 4,094 666 9,605 3,219 2,400 17,177 1,467 954 941 3,927 13,422 771 283 4,581 3,896 1,548 3,825 566 78 18 1,647 295 1,209 993 16,303 1,660 1,235 16 1,121 4,833 2,214 45 560 9,634 2,650 919 1,131 1,261 1,829 306 1,325 3,548 4,059 2,216 803 2,387 361 1,064 379 340 4,168 531 16,322 2,450 329 4,893 2,030 1,506 8,024 531 1,231 392 2,087 9,758 410 105 2,233 2,269 731 1,593 268 12 3 2,428 183 2,214 1,255 30,500 2,026 1,284 29 976 6,010 2,256 50 962 19,077 4,595 1,577 1,495 1,572 2,202 457 1,788 4,006 8,317 4,418 1,072 2,761 747 1,631 519 376 7,576 704 21,443 3,526 631 8,559 2,531 2,135 15,011 1,359 884 835 3,162 10,138 654 270 4,049 3,573 1,459 3,213 460 34 14 210 26 426 195 6,585 416 185 0 94 1,015 630 0 78 5,110 1,173 24£ 274 183 622 41 315 919 1,223 1,377 83 1,384 50 246 0 27 418 51 5,735 874 47 1,133 466 363 2,958 196 216 8 704 3,000 111 2 335 1,174 243 625 14 0 0 3,750 3,417 1,957 1,460 1,650 1,439 197 District of Columbia - allt * IPC deposits are those of individuals, partnerships, and corporations. t Also includes securities sold under agreements to repurchase. $ Includes National and non-National banks in the District of Columbia, all of which are supervised by the Comptroller of the Currency. NOTE: Data may not add to totals because of rounding. Dashes indicate amounts less than $500,000. 220 TABLE B-25 Capital accounts of National banks, by States, June 30, 1974 [Dollar amounts in millions ] United States Alabama Alaska Arizona Arkansas California Colorado Connecticut Delaware District of Columbia Florida Georgia Hawaii Idaho Illinois Indiana Iowa Kansas Kentucky Louisiana Maine Maryland Massachusetts Michigan Minnesota Mississippi Missouri Montana Nebraska Nevada New Hampshire New Jersey New Mexico New York North Carolina North Dakota Ohio Oklahoma Oregon Pennsylvania Rhode Island South Carolina South Dakota Tennessee Texas Utah Vermont Virginia Washington West Virginia Wisconsin Wyoming Virgin Islands Puerto Rico District of Columbia - all* .... Debentures Preferred stock Common stock $34,966 $2,301 $31 $8,295 $13,678 $10,186 $476 454 53 283 247 3,751 386 247 24 1 74 23 435 30 12 0 1 40 64 2 8 67 4 12 19 5 18 1 0 104 18 37 60 785 88 62 1 44 322 131 3 35 714 161 57 85 65 95 22 177 21 91 77 1,562 141 124 2 100 503 163 2 59 1,401 287 76 126 107 210 24 4 1 0 6 105 1 60 170 268 173 45 146 35 65 27 16 285 38 144 12 82 82 863 127 50 2 76 340 179 2 27 601 255 99 124 87 152 26 123 266 336 247 12 243 15 108 35 31 322 34 1,788 144 25 416 229 90 699 58 75 28 194 755 22 13 184 139 81 113 35 3 5 223 1,225 587 8 128 2,822 715 248 356 268 482 73 ... Capital reserves Total capital accounts 4 49 94 98 9 29 9 22 0 1 306 891 1,280 721 201 646 96 284 90 93 1,137 133 5,323 654 85 1,483 557 384 2,611 177 214 109 577 2,323 111 33 614 473 242 476 79 8 2 65 12 242 134 5 36 45 101 238 5 12 11 27 105 15 1 28 5 7 43 7 0 0 336 13 0o 0 0 o o 0 1 0 0 o 2 0 0 0 2 0 Surplus 0 0 0 148 25 336 121 94 502 30 52 32 135 627 30 7 153 134 46 118 7 o0 1 117 404 569 195 134 222 35 85 28 45 449 46 1,794 223 28 693 159 100 1,117 84 74 36 211 766 43 10 247 184 102 197 29 4 1 1 58 134 0 o0 o 0 5 o o 0 18 0 0 0 o 0 2 0 0 o o 0 0 Undivided profits 1 19 50 0 0 37 8 5 2 4 4 1 3 2 13 8 1 1 1 4 1 15 3 2 4 2 2 3 0 53 0 1 10 70 0 1 2 12 5 5 1 0 129 1 * Includes National and non-National banks in the District of Columbia, all of which are supervised by the Comptroller of the Currency. NOTE: Data may not add to totals because of rounding. Dashes indicate amounts less than $500,000. 221 TABLE B-26 Total and principal assets of National banks, by States, Dec. 31, 1974 [Dollar amounts in millions] Securities, gross' Number of banks 4,708 United States Alabama . . .. Alaska . . . . ... Arizona Arkansas California . Colorado Connecticut Delaware District of Columbia Florida Georgia Hawaii Idaho . Illinois Indiana Iowa Kansas . Kentucky Louisiana Maine Maryland Massachusetts Michigan Minnesota Mississippi Missouri Montana Nebraska Nevada New Hampshire New Jersey New Mexico New York North Carolina North Dakota Ohio Oklahoma Oregon . Pennsylvania Rhode Island South Carolina South Dakota Tennessee . .... Texas Utah Vermont Virginia Washington West Virginia Wisconsin Wyoming Virgin Islands Puerto Rico .... .... .. ... .. ... .. .. District of Columbia - all II Total assets $534,422 Cash assets* $76,557 U.S. Government obligations^ $45,870 93 5 3 74 55 127 24 5 13 282 64 2 6 420 121 99 171 80 52 20 40 78 117 202 39 110 55 121 4 47 122 34 154 26 43 217 193 8 250 5 18 31 75 569 11 17 109 23 100 128 44 1 1 6,295 901 4,875 3,509 75 414 5 908 3,889 56 2,958^ 17,138 7,995 141 2 166 47,526 11,841 3 940 4,527 4,436 7,325 1,018 4,559 12,516 18,776 11,285 2,899 9,896 1,750 4 266 1,283 1,030 16,148 1 924 72,336 9,326 1,293 20,418 7,684 5,563 36,474 2,641 2,517 1,691 8,784 35,079 1,634 390 8,987 9,436 3,359 7,318 1,150 124 31 855 162 591 596 9,933 1,071 755 5 451 2,798 1,106 20 270 5,736 1,669 694 724 566 1,088 131 553 1,666 2,931 1,643 445 1,840 214 679 177 152 1,868 273 11,835 1,429 152 2,455 1,316 881 3,999 257 392 199 1,400 6,365 284 44 1,065 1,336 362 955 150 14 8 568 81 393 340 7,310 402 206 10 245 1,617 267 24 175 4,998 1,286 446 569 473 854 56 302 917 1,559 1,153 268 796 164 388 137 99 1,579 188 4,180 636 161 2,200 738 334 3,157 174 216 148 795 2,727 106 27 640 547 480 589 143 1 2 16 4,304 664 414 State and local $57,296 Loans, gross Other $3,835 918 142 462 439 5,114 672 423 3 265 2,630 659 6 272 4,454 1,293 434 573 516 920 138 536 1,505 2,164 1,230 377 1,248 241 494 143 95 2,542 251 5,104 1,229 184 2,899 1,247 747 4,266 219 271 244 894 5,209 147 46 1,147 841 522 753 166 1 3 32 4 15 13 319 32 37 418 25 $297,852 17 146 85 11 479 123 17 14 9 23 3 15 72 141 94 12 24 5 16 6 3 303 5 464 35 2 243 43 18 568 9 5 6 62 163 4 3 31 35 15 40 12 Federal funds sold§ $23,751 Direct lease financing $2,414 3,341 441 3,005 1,751 44,116 3,233 2,138 33 1,562 8,186 4,637 87 1,293 28,865 6,146 1,936 2,032 2,214 3,408 634 2,727 7,123 10,934 6,186 1,601 4,577 1,012 2,171 755 615 8,632 1,039 43,386 5,352 738 10,642 3,490 3,006 20,795 1,797 1,304 1,004 4,758 16,826 970 251 5,386 5,280 1,519 4,222 592 91 16 338 33 173 251 2,910 243 141 4 329 1,161 708 0 74 1,011 744 296 468 457 790 19 225 447 277 562 90 1,103 63 388 11 36 521 99 662 149 22 1,200 603 190 1,793 42 238 42 433 2,424 62 9 330 800 347 371 50 10 2 20 2 4 5 922 19 15 0 2 16 31 0 7 78 113 1 3 39 26 0 28 74 32 39 2,273 375 14 39 1 23 10 74 177 31 0 82 31 19 201 8 1 39 72 9 11 80 2 25 2 0 0 * Cash, balances with other banks, and cash items in process of collection. t Includes investment securities and securities held in trading accounts. $ Includes U.S. Treasury securities and obligations of other U.S. Government agencies. § Also includes securities purchased under agreement to resell. II Includes National and non-National banks in the District of Columbia, all of which are supervised by the Comptroller of the Currency. NOTE: Data may not add to totals because of rounding. Dashes indicate amounts less than $500,000. 222 TABLE B-27 Total and principal liabilities of National banks, by States, Dec. 31, 1974 [Dollar amounts in millions] Deposits United States . Alabama Alaska Arizona Arkansas California Colorado Connecticut Delaware District of Columbia. Florida Georgia Hawaii Idaho Illinois Indiana Iowa Kansas Kentucky Louisiana Maine Maryland Massachusetts .. Michigan Minnesota Mississippi Missouri Montana Nebraska Nevada New Hampshire New Jersey . . . . New M e x i c o . . . . New York North Carolina . North Dakota . . . Ohio Oklahoma Oregon Pennsylvania . . . Rhode Island . . . South Carolina . South Dakota . . . Tennessee Texas Utah Vermont Virginia Washington West Virginia .. Wisconsin Wyoming Virgin Islands . . Puerto Rico . . . . District of Columbia - allt Federal funds purchased^ Demand deposits, total Time and savings deposits, total Demand deposits, IPC* Time deposits, 1PC* $493,400 $431,225 $180,391 $250,834 $137,829 $207,794 $36,323 5,772 837 4,548 3,224 70,778 5,447 3,598 51 2,700 15,735 7,341 131 2,014 44,065 10,967 3,650 4,130 4,107 6,766 930 4,205 11,469 17,271 10,439 2,668 9,151 1,620 3,934 1,178 925 14,843 1,773 66,257 8,545 1,192 18,699 7,053 5,111 33,505 2,435 2,306 1,561 8,125 32,343 1,506 357 8,254 8,847 3,080 6,759 1,057 114 29 5,286 763 3,862 2,956 62,004 4,900 3,339 49 2,464 14,421 6,072 125 1,913 38,170 9,372 3,322 3,765 3,708 5,873 877 3,684 9,792 15,660 8,779 2,502 7,255 1,513 3,512 1,141 869 2,923 364 2,428 1,529 41,288 2,486 1,503 31 1,048 7,808 2,908 74 1,136 24,005 5,548 1,823 1,892 1,947 3,123 502 2,062 4,882 9,860 5,167 1,356 3,336 960 1,858 665 431 8,445 969 30,328 4,073 663 9,905 3,478 2,554 17,594 1,505 779 990 4,071 14,412 820 242 4,681 4,330 1.681 3,668 595 84 22 1,807 34« 1,273 1,080 17,626 1,826 1,379 16 1,141 5,032 2,387 44 647 10,330 2,760 1,072 1,325 1,420 2,075 317 2,565 216 2,195 1,317 33,190 2,087 1,289 30 1,000 6,165 2,360 50 996 20,086 4,781 1,645 1,570 1,728 2,377 457 13,997 1,650 55,503 7,544 1,112 16,473 6,457 4,367 28,018 2,192 2,063 1,502 7,153 28,772 1,408 347 7,545 7,329 2,743 5,971 994 109 28 2,363 400 1,433 1,427 20,716 2,415 1,835 18 1,416 6,613 3,164 50 111 14,165 3,824 1,499 1,873 1,761 2,750 375 1,622 4,910 5,799 3,612 1,146 3,919 553 1,654 476 439 5,552 680 25,175 3,471 449 6,569 2,978 1,813 10,424 687 1,284 512 3,082 14,360 588 105 2,864 2,998 1,062 2,303 399 26 7 1,410 3,674 4,116 2,586 855 2,649 452 1,189 392 347 4,471 557 16,877 2,724 390 5,362 2,225 1,566 8,513 571 1,086 437 2,291 10,720 466 90 2,409 2,540 823 1,812 311 12 4 1,866 4,011 8,363 4,536 1,109 2,911 850 1,660 520 392 7,630 736 23,055 3,442 632 8,823 2,746 2,126 15,178 1,386 681 885 3,376 10,819 667 230 4,145 3,641 1,565 3,176 481 38 15 257 52 455 184 4,551 313 117 0 175 900 720 0 25 3,885 1,062 247 277 282 622 27 346 984 1,044 1,109 89 1,558 44 332 0 25 348 66 4,435 508 42 1,426 449 481 3,024 160 165 13 622 2,587 51 1 359 1,117 238 528 24 0 0 3,916 3,586 2,069 1,517 1,674 1,460 234 Total liabilities Total deposits Reserves on loans and securities * IPC deposits are those of individuals, partnerships, and corporations. t Also includes securities sold under agreements to repurchase. $ Includes National and non-National banks in the District of Columbia, all of which are supervised by the Comptroller of the Currency. NOTE: Data may not add to totals because of rounding. Dashes indicate amounts less than $500,000. 223 TABLE B-28 Capital accounts of National banks, by States, Dec. 31, 1974 [Dollar amounts in millions] Undivided profits Capital reserves Total capital accounts Debentures Preferred stock Common stock United States $35,830 $2,258 $13 $8,336 $14,067 $10,652 $503 Alabama Alaska Arizona Arkansas California Colorado Connecticut Delaware District of Columbia Florida Georgia Hawaii Idaho Illinois [ndiana Iowa Kansas Kentucky Louisiana Maine Maryland Massachusetts Michigan Minnesota Mississippi Missouri Montana Nebraska Nevada New Hampshire New Jersey New Mexico New York North Carolina North Dakota Ohio Oklahoma Oregon Pennsylvania Rhode Island South Carolina South Dakota Tennessee Texas Utah Vermont Virginia Washington West Virginia Wisconsin Wyoming Virgin Islands Puerto Rico 469 57 288 259 3,821 409 255 5 231 1,282 24 1 74 23 432 30 12 0 1 40 0 0 0 0 0 0 0 0 1 1 104 18 37 60 787 91 62 1 45 336 180 26 91 80 1,567 148 127 2 100 521 157 12 86 89 924 139 54 2 84 365 4 1 0 7 111 1 586 10 134 2,894 781 256 367 287 496 77 310 914 1,318 749 205 667 114 294 94 95 1,162 137 5,257 690 89 1,542 578 403 2,641 181 189 113 585 2,421 115 29 645 493 254 487 84 8 2 64 2 8 72 4 13 18 6 18 1 0 0 133 1 31 646 272 104 130 100 164 28 .... . ... ... 0 0 0 o0 1 203 3 61 1,418 332 77 129 111 212 25 117 412 573 202 148 225 40 86 27 47 448 49 1,909 231 29 706 162 99 1,133 83 71 37 214 778 43 9 254 185 106 199 30 4 1 13 1 58 134 6 44 93 99 9 29 10 22 0 1 0 0 o 0 0 0 OCMC 65 13 189 141 6 36 46 101 238 5 7 11 29 106 15 0 0 0 OO 349 32 5 7 44 7 0 0 131 4 35 719 163 57 86 65 96 23 61 171 278 175 44 150 40 66 27 15 290 39 1,453 149 26 338 123 94 496 30 35 33 136 643 30 7 156 134 48 120 8 0 0 0 0 0 122 285 363 263 3 256 24 117 39 32 344 34 1,705 165 26 459 245 109 717 63 74 31 197 813 26 12 202 157 88 118 38 4 1 19 55 0 0 37 8 6 2 5 5 1 3 2 12 9 1 1 1 3 1 15 3 1 4 bototo .. otoo .... o 1 oenoo o .. .. CM O District of Columbia — all* . Surplus 0 56 0 2 1 10 81 0 1 12 5 5 2 0 141 1 * Includes National and non-National banks in the District of Columbia, all of which are supervised by the Comptroller. NOTE: Data may not add to totals because of rounding. Dashes indicate amounts less than $500,000. 224 TABLE B-29 Loans of National banks, by States, Dec, 31, 1974 [Dollar amounts in millions] Loans Loans secured by real estate Loans to financial institutions Loans to purchase or carry securities Loans to farmers Commercial and industrial loans Personal loans to individuals United States. $297,852 $73,739 $27,505 $4,475 $9,120 $114,825 $59,451 Alabama Alaska Arizona Arkansas California Colorado Connecticut Delaware District of Columbia. Florida Georgia Hawaii Idaho Illinois Indiana Iowa Kansas Kentucky Louisiana Maine Maryland Massachusetts.. Michigan Minnesota Mississippi Missouri Montana Nebraska Nevada New Hampshire New Jersey . . . . New Mexico New York North Carolina . North Dakota... Ohio Oklahoma Oregon Pennsylvania . . . Rhode Island . . . South Carolina . South Dakota... Tennessee Texas Utah Vermont Virginia Washington . . . . West Virginia .. Wisconsin Wyoming Virgin Islands .. Puerto Rico . . . . 3,341 441 3,005 1,751 44,116 3,233 2,138 33 1,562 8,186 4,637 87 1,293 28,865 6,146 1,936 2,032 2,214 3,408 635 650 174 981 467 12,788 747 742 17 487 2,473 1,018 46 368 3,871 2,230 509 286 677 850 247 1,081 1,046 4,252 1,575 401 845 283 257 340 192 128 34 67 157 30 4,507 181 49 0 267 314 258 13 57 350 37 3 0 8 66 44 0 4 754 50 44 60 11 65 255 98 1,424 316 2 1 0 68 37 23 36 128 179 24 115 1 99 3 1 22 8 1,004 39 1 82 103 18 141 2 7 1 45 660 4 25 5 80 312 50 201 187 657 13 3 9 105 192 44 144 130 433 130 175 1 16 301 77 912 39 6 97 229 11 104 122 0 0 1,112 148 813 502 16,718 955 723 3 319 2,605 1,646 32 326 13,705 1,636 524 612 610 1,301 185 669 3,917 2,868 2,292 458 1,911 245 548 169 203 2,309 366 22,890 2,274 212 3,193 1,194 1,230 7,613 589 435 236 1,701 7,101 278 47 1,577 1,968 313 1,348 169 12 12 1,200 112 738 572 7,102 930 547 11 349 2,521 1,480 9 380 3,401 1,755 442 539 648 850 180 715 1,146 2,196 1,176 527 995 285 507 211 209 2,007 314 4,428 1,787 160 3,303 766 520 4,060 263 500 211 1,424 3,474 232 60 1,661 1,042 601 748 144 13 2 0 448 486 District of Columbia - all* 2,727 7,123 10,934 6,186 1,601 4,577 1,012 2,171 755 615 8,632 1,039 43,386 5,352 738 10,642 3,490 3,006 20,795 1,797 1,304 1,004 4,758 16,826 970 251 5,386 5,280 1,519 4,222 592 91 16 2,273 3,730 198 7,036 875 213 3,202 709 853 5,833 759 297 243 1,203 2,709 359 134 1,636 1,457 544 1,636 147 64 1 760 16 5,245 224 27 35 93 210 5 154 833 888 573 71 378 6 61 14 2 374 22 6,624 235 1 518 188 232 2,268 116 9 5 231 1,032 36 185 471 25 201 2 0 16 36 5 67 4 386 19 182 711 140 364 479 113 44 7 * Includes National and non-National banks in the District of Columbia, all of which are supervised by the Comptroller of the Currency. NOTE: Data may not add to totals because of rounding. Dashes indicate amounts of less than $500,000. 225 TABLE B-30 Outstanding balances, credit cards and related plans of National banks, Dec. 31, 1974 Credit cards Number of banks Outstanding volume (dollars in thousands) Other related credit plans Number of banks Outstanding volume (dollars in thousands) United States* 861 $6,052,634 1,040 $1,397,922 Alabama Arizona Arkansas California Colorado Connecticut Delaware District of Columbia* Florida Georgia Idaho Illinois Indiana Iowa Kansas Kentucky Louisiana Maine Maryland Massachusetts Michigan Minnesota Mississippi Missouri Montana Nebraska Nevada New Hampshire New Jersey New Mexico New York North Carolina North Dakota Ohio Oklahoma Oregon Pennsylvania Rhode Island South Carolina South Dakota Tennessee Texas Utah Vermont Virginia Washington West Virginia Wisconsin Wyoming Alaska Hawaii Virgin Islands Puerto Rico 18 2 6 25 48 5 0 1 64 75 647 91,245 23,050 1,281,463 139 282 84,225 0 68,863 179,207 218,017 25,622 339,283 102,647 34 297 45,157 49,571 57,236 13,298 90,821 110,378 268,915 12,383 26,686 184,362 2 966 99,458 19,494 14,166 78,396 20,663 482,187 124,657 713 323,707 83,079 90,001 224,674 33,945 41,233 0 119,671 283,525 31,780 2,436 160,399 154,839 15,775 105 309 1,543 16,363 0 0 0 7 2 6 30 51 10 0 8 50 8 2 103 17 17 16 5 9 11 12 43 38 102 1 25 15 18 1 13 51 4 49 16 13 52 20 0 38 2 4 5 11 44 I 1 21 6 8 57 16 0 1 0 0 2,660 20,628 560 207,286 18,847 24,018 0 30,343 63,970 24,054 9,389 51,036 13,730 1,988 1,787 3,754 8,368 4,684 21,648 108,233 48,615 50,866 811 13,781 1,344 3,106 4,955 2,804 70,657 2,060 222,599 51,776 1,736 35,077 3,272 0 186,487 16,418 1,775 332 7,077 13,933 359 15 10,868 13,171 933 13,471 2,109 0 532 0 0 .... .... ... .... f .... ... ... .. ... . . .. ... .... 26 3 33 58 8 5 33 6 15 2 40 30 3 2 9 6 5 3 21 20 5 31 9 5 105 7 3 17 4 4 0 13 57 3 4 22 5 10 47 10 3 0 0 0 * Includes National and non-National banks in the District of Columbia, all of which are supervised by the Comptroller of the Currency. 226 TABLE B-31 National banks engaged in direct lease financing, Dec. 31, 1974 Total number of banks Number of banks engaged in direct lease financing Amount of direct lease financing (dollars in thousands) United States. 4,708 679 $2,414,038 Alabama Alaska Arizona Arkansas California Colorado Connecticut Delaware District of Columbia. Florida Georgia Hawaii Idaho Illinois Indiana Iowa Kansas Kentucky Louisiana Maine Maryland Massachusetts .. Michigan Minnesota Mississippi Missouri Montana Nebraska Nevada New Hampshire New Jersey New Mexico New York North Carolina . North Dakota . . . Ohio Oklahoma Oregon Pennsylvania . . . Rhode Island . . . South Carolina . South Dakota . . . Tennessee Texas Utah Vermont Virginia Washington West Virginia .. Wisconsin Wyoming Virgin Islands .. Puerto Rico 93 5 3 74 55 127 24 5 13 282 12 2 2 7 19 30 3 0 3 43 13 0 2 54 21 13 21 9 8 0 4 8 23 18 7 25 12 12 3 2 9 2 15 6 0 39 73 3 16 2 3 2 15 48 3 2 9 6 10 23 17 0 0 20,150 1,908 4,118 4,862 921,740 19,470 15,471 0 2,462 15,996 30,569 0 7,398 77,897 113,494 1,455 2,934 38,812 26,237 0 27,669 74,022 32,006 39,360 297 39,364 1,047 22,839 9,632 5 74,288 58 176,647 30,701 0 81,726 30,610 19,279 District of Columbia - all* 64 2 6 420 121 99 171 80 52 20 40 78 117 202 39 110 55 121 4 47 122 34 154 26 43 217 193 8 250 5 18 31 75 569 11 17 109 23 100 128 44 1 1 16 200,966 8,431 849 4fi 38,541 71,550 9,081 219 10,750 79,706 2,138 25,042 2,194 0 0 14,290 * Includes National and non-National banks in the District of Columbia, all of which are supervised by the Comptroller of the Currency. 227 TABLE B-32 Income and expenses of National banks,* by States, year ended Dec. 31, 1974 [Dollar amounts in thousands] United States Number of banks 4708 Operating income: Interest and fees on loans $28,418,563 Income on Federal funds sold and securities purchased under 2,173,089 agreements to resell Interest and dividends on investments: 1,752,716 U.S. Treasury securities Obligations of other U.S. Government agencies and corporations 1,018,360 Obligations of States and political subdivisions 2,531,299 Other securities 258,901 Trust department income 853,728 Service charges on deposit accounts 827,191 Other service charges, collection and exchange charges, commissions, 938,515 and fees 1,675,980 Other operating income Total operating income Operating expense: Salaries and wages of officers and employees Pensions and other employee benefits Interest on deposits Expense of Federal funds purchased and securities sold under agreements to repurchase Interest on borrowed money Interest on capital notes and debentures Occupancy expense of bank premises, net Furniture and equipment, depreciation, rental costs, servicing, etc Provision for loan losses (or actual net loan losses) Other operating expenses Total operating expense Income before income taxes and securities gains or losses Applicable income taxes Income before securities gains or losses Net securities gains or losses (after tax effect) Net income before extraordinary items Extraordinary charges or credits Minority interest in consolidated subsidiaries Net income Alabama Alaska Arizona 93 Arkansas California Colorado Connecticut 74 55 127 24 $306,203 $41,582 $299,601 $150,886 $4,346,195 $330,525 $214,588 28,270 3,909 7,835 27,347 223,834 21,838 7,589 24,989 1,614 14,226 13,061 209,416 19,425 6,730 14,041 42,064 1,864 8,577 14,914 3,834 7,169 763 662 3,466 10,922 21,580 305 7,406 11,648 10,403 18,970 775 2,567 7,511 141,658 219,849 41,638 99,097 144,599 8,282 31,690 1,299 15,739 16,668 6,762 18,208 2,736 15,861 6,310 10,612 9,242 3,329 945 5,610 7,036 6,017 4,067 180,179 383,363 14,701 8,810 8,690 8,633 40,448,342 460,776 67,273 386,169 241,604 5,989,828 468,977 296,107 5,593,025 1,033,991 16,584,980 71,897 14,102 177,668 15,434 2,162 23,395 70,615 12,033 160,606 38,341 6,027 87,472 864,968 149,630 2,802,292 79,966 12,887 162,729 61,687 10,387 95,801 4,277,220 519,256 147,782 1,146,564 23,536 5,032 2,025 11,767 2,352 46 50 2,544 44,433 1,068 4,463 15,633 21,713 745 1,585 8,095 518,992 68,516 26,588 192,390 38,141 2,665 2,319 12,949 24,513 4,021 589 14,270 811,897 1,391,805 3,734,922 11,991 12,787 52,123 2,315 1,102 6,774 11,350 9,843 33,303 7,704 4,389 27,142 94,492 215,218 448,893 12,645 15,478 69,139 9,581 9,154 32,594 35,241,442 382,928 56,174 363,347 203,213 5,381,979 408,918 262,597 5,206,900 1,122,623 4,084,277 - 42,420 4,041,857 + 2,758 - 141 77,848 16,832 61,016 - 43 60,983 + 87 0 11,099 1,929 9,170 - 181 8,989 0 0 22,822 - 493 23,315 - 305 23,010 0 0 38,391 8,553 29,838 - 129 29,709 -82 0 607,849 192,356 415,493 - 3,376 412,117 + 621 0 60,059 12,173 47,886 - 71 47,815 + 3,451 0 33,510 8,667 24,843 - 100 24,743 - 264 0 4,044,474 61,060 8,989 23,010 29,627 412,738 51,266 24,479 Changes in capital accounts: Increases: Net income transferred to undivided profits Capital stock, notes and debentures sold or issued including premium received Addition to surplus, undivided profits and reserves incident to mergers and consolidations Transfers from reserves on loans and securities All other increases Total increases Decreases: Cash dividends declared: On common stock On preferred stock Capital stock, notes and debentures, retired including premium paid Reduction in surplus, undivided profits and reserves incident to mergers and consolidations Transfers to reserves on loans and securities All other decreases Total decreases Net change in capital accounts Capital accounts! Ratios: Net income before dividends to capital accounts (percent) .. Total operating expense to total operating revenue (percent) See footnotes at end of table. to to FRASER Digitized for 4,044,474 61,060 8,989 23,010 29,627 412,738 51,266 24,479 570,368 5,600 25 227 2,600 66,462 10,734 1,533 117,912 65,420 229,833 983,533 1,214 320 14,884 22,018 0 161 51 0 0 0 76 1,288 2,945 237 227 6,909 3,516 1,843 10,224 82,045 1,165 524 2,373 14,796 0 61 1,278 2,872 1,670,232 977 22,148 0 1,089 0 11,016 0 6,717 0 202,841 0 17,928 0 13,260 0 87,768 0 20 146 129 4,404 683 32,298 216,362 212,413 1,902 2,688 13,081 0 474 217 0 77 501 7 1,270 1,515 9,117 51,814 22,549 0 1,016 1,156 0 - 269 179 2,220,050 39,819 1,800 11,740 9,638 290,725 20,783 13,177 2,807,957 43,259 7,426 11,497 26,898 204,058 45,279 14,174 34,646,893 450,027 53,260 282,710 245,322 3,735,620 386,518 248,465 11.67 13.57 16.88 8.14 12.08 11.05 13.26 9.85 87.13 83.11 83.50 94.09 84.11 89.85 87.19 88.68 to TABLE B-32—Continued Income and expenses of National banks,* by States, year ended Dec. 31, 1974 [Dollar amounts in thousands] Delaware Total operating income Operating expense: Salaries and wages of officers and employees Pensions and other employee benefits Interest on deposits Expense of Federal funds purchased and securities sold under agreements to repurchase Interest on borrowed money Interest on capital notes and debentures Occupancy expense of bank premises, net Furniture and equipment, depreciation, rental costs, servicing, etc Provision for loan losses (or actual net loan losses) Other operating expenses Total operating expense Income before income taxes and securities gains or losses Applicable income taxes Income before securities gains or losses Net securities gains or losses (after tax effect) Net income before extraordinary items Extraordinary charges or credits Minority interest in consolidated subsidiaries Net income Florida Georgia Hawaii 13 282 64 $2,674 $144,877 $800,811 $517,572 $8,900 424 17,361 102,933 47,585 483 13,175 62,084 174 94 4 0 106 2,866 11,538 1,035 6,727 6,144 60 46 Idaho Illinois Indiana 420 121 $115,827 $2,810,847 $550,228 302 8,512 150,384 69,407 12,448 926 8,014 169,299 53,127 46,078 129,275 8,597 28,658 32,195 5,385 33,346 3,522 17,118 23,568 826 261 10 0 66 2,948 11,507 479 998 5,898 140,755 210,293 34,920 87,965 43,523 28,137 61,731 23,659 17,524 18,202 2,527 4,061 30,932 25,793 18,177 32,272 391 128 3,673 848 60,304 113,784 23,308 16,972 4,065 210,311 1,267,356 710,993 11,810 158,704 3,822,074 862,295 749 140 1,470 40,433 7,067 66,540 186,468 30,483 512,969 121,467 22,144 191,771 2,661 352 5,171 27,569 4,807 68,701 371,473 68,364 1,722,441 118,098 19,961 338,327 1 0 0 134 11,049 1,905 85 7,506 99,760 5,634 2,675 30,444 100,381 48,089 3,988 21,927 36 4 75 741 3,274 1,171 500 3,733 620,166 23,405 5,217 73,274 114,068 6,504 308 24,562 157 21 539 4,925 4,475 21,758 28,044 50,685 174,947 19,193 51,661 83,316 328 302 1,830 4,000 3,065 15,354 55,135 93,713 278,316 20,560 22,844 85,075 3,211 165,743 1,122,109 663,937 11,500 132,174 3,311,504 750,307 854 318 536 - 7 529 0 0 44,568 15,965 28,603 + 70 28,673 + 325 0 145,247 9,406 135,841 - 1,191 134,650 + 69 0 47,056 1,450 45,606 - 546 45,060 + 39 0 310 37 273 + 22 295 - 4 0 26,530 7,354 19,176 - 79 19,097 + 43 0 510,570 131,343 379,227 - 783 378,444 + 923 - 2 111,988 23,092 88,896 - 803 88,093 + 135 0 529 28,998 134,719 45,099 291 19,140 379,365 88,228 Number of banks Operating income: Interest and fees on loans Income on Federal funds sold and securities purchased under agreements to resell Interest and dividends on investments: U.S. Treasury securities Obligations of other U.S. Government agencies and corporations Obligations of States and political subdivisions Other securities Trust department income Service charges on deposit accounts Other service charges, collection and exchange charges, commissions, and fees Other operating income District of Columbia Changes in capital accounts: Increases: Net income transferred to undivided profits .. Capital stock, notes and debentures sold or issued including 529 28,998 134,719 45,099 291 19,140 379,365 88,228 0 2,252 65,435 10,031 1,572 3,812 23,094 1,780 0 0 82 900 202 52 8,194 4,562 7,563 561 922 8,880 0 0 54 0 0 248 1,395 12,071 11,865 344 2,375 37,743 82 3,406 85,754 20,394 1,626 4,060 48,425 42,242 123 0 10,602 356 62,144 0 23,967 0 175 0 6,976 0 169,395 88 29,237 0 0 953 2,785 7,968 0 0 6,847 23 0 18 97 0 1,808 356 200 4,416 3,978 325 2,035 3,881 0 235 0 0 1,445 110 112 39,970 7,415 234 3,354 1,944 238 14,075 73,523 38,176 410 8,531 223,827 34,792 373 18,329 146,950 27,317 1,507 14,669 203,963 95,678 4,600 222,595 1,211,903 575,319 8,588 127,042 2,802,509 727,598 Ratios: Net income before dividends to capital accounts (percent) . . . 11.50 13.03 11.12 7.84 3.39 15.07 13.54 12.13 Total operating expense to total operating revenue (percent) . 78.99 83.28 86.64 87.01 Addition to surplus, undivided profits and reserves incident to mercers and consolidations ... Transfers from reserves on loans and securities Total increases Decreases: Cash dividends declared: On common stock On preferred stock Capital stock, notes and debentures, retired including preReduction in surplus, undivided profits and reserves incident Transfers to reserves on loans and securities All other decreases Total decreases Net change in capital accounts See footnotes at end of table. 78.81 88.54 93.38 97.38 to to TABLE B-32—Continued Income and expenses of National banks,* by States, year ended Dec. 31, 1974 [Dollar amounts in thousands] Iowa Number of banks Operating income: Interest and fees on loans Income on Federal funds sold and securities purchased under agreements to resell Interest and dividends on investments: U.S. Treasury securities Obligations of other U.S. Government agencies and corporations Obligations of States and political subdivisions Other securities Trust department income Service charges on deposit accounts Other service charges, collection and exchange charges, commissions, and fees Other operating income Total operating income Operating expense: Salaries and wages of officers and employees Pensions and other employee benefits Interest on deposits Expense of Federal funds purchased and securities sold under agreements to repurchase Interest on borrowed money Interest on capital notes and debentures Occupancy expense of bank premises, net Furniture and equipment, depreciation, rental costs, servicing, etc Provision for loan losses (or actual net loan losses) Other operating expenses Total operating expense Income before income taxes and securities gains or losses Applicable income taxes Income before securities gains or losses Net securities gains or losses (after tax effect) Net income before extraordinary items Extraordinary charges or credits Minority interest in consolidated subsidiaries Net income Kansas Kentucky Louisiana Maine Maryland Massachusetts Michigan 99 171 80 52 20 40 78 117 $164,343 $179,377 $191,235 $316,773 $60,931 $252,104 $743,200 $1,001,290 28,698 34,545 27,211 55,962 2,718 19,993 43,763 65,114 17,802 25,847 22,908 40,469 2,611 15,569 37,830 74,016 10,862 18,516 1,013 5,465 5,340 12,804 23,998 914 4,378 7,343 7,953 22,416 647 3,441 5,679 14,640 39,495 2,742 4,617 12,360 1,181 6,830 211 2,314 1,966 6,060 22,454 1,518 4,537 10,381 14,948 54,835 3,715 45,509 17,221 27,270 98,002 10,407 29,255 28,081 7,818 2,618 10,032 3,645 5,993 8,754 13,307 11,009 2,121 903 6,604 5,335 33,299 59,732 22,255 23,257 262,475 302,883 296,237 511,374 81,786 344,555 1,054,052 1,378,947 37,252 5,904 101,888 45,230 7,537 113,849 44,657 7,313 104,822 63,417 10,754 202,786 15,534 3,155 29,391 59,976 9,94fi 108,452 166,097 33,591 367,093 198,146 35,853 635,863 27,067 907 900 7,240 23,511 2,761 1,288 7,652 20,652 3,488 417 9,577 57,088 11,556 1,582 14,080 3,408 175 96 3,650 38,118 1,913 289 12,846 124,952 9,429 3,226 35,250 124,043 4,066 6,121 40,167 9,185 2,683 25,453 8,310 6,757 29,845 8,198 5,602 33,162 14,080 11,482 51,339 2,534 1,940 10,898 8,502 11,487 46,802 20,957 58,869 115,230 28,759 22,317 113,605 218,479 246,740 237,888 438,164 70,781 298,333 934,694 1,208,940 43,996 12,297 31,699 - 284 31,415 - 20 - 11 56,143 15,660 40,483 - 506 39,977 - 92 0 58,349 15,885 42,464 - 886 41,578 - 5 0 73,210 16,850 56,360 - 1,513 54,847 - 126 0 11,005 1,835 9,170 + 108 9,278 + 99 0 46,222 11,751 34,471 - 492 33,979 + 35 0 119,358 31,539 87,819 - 3,038 84,781 + 102 0 170,007 34,378 135,629 - 2,201 133,428 + 1,629 -6 31,384 39,885 41,573 54,721 9,377 34,014 84,883 135,051 Changes in capital accounts: Increases: Net income transferred to undivided profits Capital stock, notes and debentures sold or issued including premium received Addition to surplus, undivided profits and reserves incident to mergers and consolidations Transfers from reserves on loans and securities All other increases Total increases Decreases: Cash dividends declared: On common stock On preferred stock Capital stock, notes and debentures, retired including premium paid Reduction in surplus, undivided profits and reserves incident to mergers and consolidations Transfers to reserves on loans and securities All other decreases Total decreases Net change in capital accounts Capital accountst 31,384 39,885 41,573 54,721 9,377 34,014 84,883 135,051 1,470 2,532 1,849 7,384 500 5,745 16,830 13,273 207 155 1,504 3,336 1,041 470 1,888 5,931 102 1,980 1,992 135 1,756 1,648 700 228 228 2,850 1,021 6,127 5,923 10,923 1,656 2,666 674 1,190 10,275 26,828 3,830 399 4,911 22,413 11,032 0 11,583 0 8,929 0 15,925 0 4,537 0 14,466 0 42,476 0 55,719 0 371 53 308 0 233 10,044 2,624 2 1,106 2,327 50 1,425 2,735 0 4,088 1,166 0 5,270 4,435 8 337 133 0 2,557 6,875 1,385 2,481 933 279 6,259 1,365 14,473 16,164 14,236 26,048 5,015 24,131 57,319 66,246 20,247 29,652 33,260 39,596 6,018 20,158 54,392 91,218 245,136 353,129 269,830 478,410 73,909 301,842 887,775 1,274,116 12.80 11.29 15.41 11.44 12.69 11.27 9.56 10.60 83.24 81.46 80.30 85.68 86.54 86.59 88.68 87.67 Ratios: Net income before dividends to capital accounts (percent) . . Total operating expense to total operating revenue (percent) See footnotes at end of table. Oo to 00 TABLE B-32—Continued Income and expenses of National banks,* by States, year ended Dec. 31, 1974 [Dollar amounts in thousands] Minnesota Number of banks Operating income: Interest and fees on loans Income on Federal funds sold and securities purchased under agreements to resell Interest and dividends on investments: U.S. Treasury securities Obligations of other U.S. Government agencies and corporations Obligations of States and political subdivisions Other securities Trust department income Service charges on deposit accounts Other service charges, collection and exchange charges, commissions, and fees Other operating income Total operating income Operating expense: Salaries and wages of officers and employees Pensions and other employee benefits Interest on deposits Expense of Federal funds purchased and securities sold under agreements to repurchase Interest on borrowed money Interest on capital notes and debentures Occupancy expense of bank premises, net Furniture and equipment, depreciation, rental costs, servicing, etc Provision for loan losses (or actual net loan losses) Other operating expenses Total operating expense Income before income taxes and securities gains or losses Applicable income taxes Income before securities gains or losses Net securities gains or losses (after tax effect) Net income before extraordinary items Extraordinary charges or credits Minority interest in consolidated subsidiaries Net income , Mississippi Missouri Montana Nebraska 202 39 110 55 121 $567,688 $141,835 $440,955 $86,614 $202,897 43,575 12,578 80,335 4,750 36,043 10,710 25,363 26,887 48,973 2,558 19,865 14,189 6,241 16,501 1,031 2,155 7,835 25,409 42,219 Nevada New Hampshire New Jersey 47 122 $68,841 $58,322 $748,406 26,993 2,751 4,495 51,296 8,036 15,025 6,664 5,681 64,943 16,876 49,477 1,254 20,504 7,978 3,096 11,005 339 804 3,574 9,695 21,916 867 6,871 5,588 2,179 6,836 380 1,963 4,824 997 4,912 152 1,655 3,147 38,569 115,136 19,158 22,383 27,662 7,455 3,677 17,378 41,338 3,54£ 1,798 10,360 6,114 2,493 1,171 972 1,675 17,788 22,180 827,406 210,018 701,458 123,564 306,326 98,102 82,008 1,127,521 95,297 17,252 335,318 31,874 5,328 85,164 84,753 15,365 236,693 16,686 2,919 57,701 43,448 7,440 114,052 18,806 3,220 39,497 15,648 3,043 25,241 196,989 36,923 476,090 122,509 22,768 6,668 15,543 11,503 392 485 5,768 145,345 3,394 1,414 14,129 4,151 475 677 2,950 26,582 4,054 1,493 8,766 29 113 0 4,074 2,795 366 65 3,882 41,750 7,465 4,490 45,742 14,638 15,076 69,868 6,453 7,909 24,685 14,819 21,954 70,666 2,977 2,637 14,102 7,795 7,804 31,318 2,443 2,070 9,971 2,391 1,833 13,314 33,268 24,481 118,915 714,937 179,561 608,532 105,275 252,752 80,223 68,578 986,113 112,469 32,286 80,183 - 806 79,377 + 261 0 30,457 6,285 24,172 + 213 24,385 + 13 0 92,926 18,701 74,225 - 527 73,698 + 90 0 18,289 3,543 14,746 - 127 14,619 + 417 0 53,574 12,575 40,999 - 59 40,940 - 104 0 17,879 5,258 12,621 + 50 12,671 0 0 13,430 3,967 9,463 - 346 9,117 + 212 0 141,408 10,535 130,873 - 206 130,667 - 84 0 79,638 24,398 73,788 15,036 40,836 12,671 9,329 130,583 Changes in capital accounts: Increases: Net income transferred to undivided profits Capital stock, notes and debentures sold or issued including premium received Addition to surplus, undivided profits and reserves incident to mergers and consolidations Transfers from reserves on loans and securities All other increases Total increases Decreases: Cash dividends declared: On common stock On preferred stock Capital stock, notes and debentures, retired including premium paid Reduction in surplus, undivided profits and reserves incident to mergers and consolidations Transfers to reserves on loans and securities All other decreases Total decreases Net change in capital accounts Capital accountst 79,638 24,398 73,788 15,036 40,836 12,671 9,329 130,583 8,280 3,120 7,446 1,215 98 0 993 14,896 180 871 4,103 13,434 9,247 229 632 0 510 2,495 589 90 941 2,613 9,838 3,535 3,405 4,220 100 481 1,943 2,622 0 0 0 13,228 1,021 620 4,651 13,738 31,674 29,177 0 9,643 0 42,847 289 4,439 0 15,166 6 4,845 0 4,370 0 65,750 3 185 120 15 0 10 200 4,431 364 5,531 1,807 27 114 338 0 2,366 1,610 0 1,061 328 0 641 1,531 0 540 811 11,732 4,600 2,204 37,064 10,242 47,127 5,828 17,354 4,853 5,921 88,720 56,008 27,384 40,399 13,428 26,104 7,818 6,021 73,537 720,889 196,554 646,350 100,895 282,486 89,830 93,245 1,129,992 11.05 12.41 11.42 14.90 14.46 14.11 10.00 11.56 86.41 85.50 86.75 85.20 82.51 81.78 83.62 87.46 Ratios: Net income before dividends to capital accounts (percent) . . Total operating expense to total operating revenue (percent) See footnotes at end of table. to as TABLE B-32—Continued Income and expenses of National banks,* by States, year ended Dec, 31, 1974 [Dollar amounts in thousands] New York New Mexico Number of banks Operating income: Interest and fees on loans Income on Federal funds sold and securities purchased under agreements to resell Interest and dividends on investments: U.S. Treasury securities Obligations of other U.S. Government agencies and corporations Obligations of States and political subdivisions Other securities Trust department income Service charges on deposit accounts Other service charges, collection and exchange charges, commissions, and fees Other operating income Total operating income Operating expense: Salaries and wages of officers and employees Pensions and other employee benefits Interest on deposits Expense of Federal funds purchased and securities sold under agreements to repurchase Interest on borrowed money Interest on capital notes and debentures Occupancy expense of bank premises, net Furniture and equipment, depreciation, rental costs, servicing, etc Provision for loan losses (or actual net loan losses) Other operating expenses Total operating expense Income before income taxes and securities gains or losses Applicable income taxes Income before securities gains or losses Net securities gains or losses (after tax effect) Net income before extraordinary items Extraordinary charges or credits Minority interest in consolidated subsidiaries Net income North Carolina North Dakota Ohio Oklahoma Oregon Pennsylvania 34 154 26 43 217 193 8 250 $97,747 $4,125,144 $549,658 $58,129 $975,896 $335,845 $278,568 $1,906,075 9,918 67,171 27,031 2,837 96,693 52,934 21,208 173,640 7,581 175,489 14,164 7,473 99,122 39,102 12,783 111,043 4,730 11,922 260 1,525 4,836 69,867 222,010 32,132 111,289 69,117 27,613 57,101 1,970 18,420 19,401 4,692 8,151 206 1,347 2,183 35,761 134,456 11,642 31,472 35,720 6,786 50,900 2,184 8,089 12,856 12,714 32,681 464 8,053 16,876 67,624 177,299 16,210 69,979 25,471 4,704 1,691 109,156 475,051 20,686 19,604 2,576 740 36,133 31,931 11,211 14,071 37,817 132,427 144,914 5,456,426 755,643 88,334 1,488,826 533,978 9,910 7,274 400,531 2,717,585 23,540 3,558 63,082 658,530 163,839 2,242,121 124,102 18,499 287,179 11,907 2,311 37,247 213,013 33,787 597,372 69,455 11,000 225,002 79,392 12,588 142,887 344,303 70,770 1,098,368 6,128 367 1,042 3,645 564,831 86,447 10,346 171,032 84,162 8,461 9,715 24,564 3,362 919 450 2,055 132,332 7,192 2,257 40,413 50,374 3,554 2,821 10,753 29,178 2,494 6,377 14,739 307,598 100,773 16,705 75,863 3,814 4,950 15,250 75,426 323,535 419,421 16,153 19,964 75,432 2,062 921 8,609 34,337 40,137 160,004 10,219 16,747 52,873 9,491 7,421 32,158 50,011 75,349 214,712 125,376 4,715,528 668,231 69,843 1,260,844 452,798 336,725 2,354,452 19,538 3,571 15,967 - 57 15,910 - 10 0 740,898 137,711 603,187 - 1,901 601,286 - 51 - 4 87,417 15,559 71,858 - 3,462 68,396 + 63 0 18,491 5,086 13,405 - 123 13,282 + 3 0 227,982 42,309 185,673 - 3,706 181,967 + 357 - 14 81,180 12,014 69,166 - 1,211 67,955 + 2,407 -1 63,806 17,060 46,746 - 604 46,142 - 16 0 363,133 58,040 305,093 - 5,262 299,831 + 612 - 107 15,900 601,231 68,459 13,285 182,310 70,361 46,126 300,336 Changes in capital accounts: Increases: Net income transferred to undivided profits Capital stock, notes and debentures sold or issued including premium received Addition to surplus, undivided profits and reserves incident to mergers and consolidations Transfers from reserves on loans and securities All other increases Total increases Decreases: Cash dividends declared: On common stock On preferred stock Capital stock, notes and debentures, retired including premium paid Reduction in surplus, undivided profits and reserves incident to mergers and consolidations Transfers to reserves on loans and securities All other decreases Total decreases Net change in capital accounts Capital accounts! 15,900 601,231 68,459 13,285 182,310 70,361 46,126 300,336 300 24,101 43,093 1,775 6,073 14,169 557 61,022 0 0 1,700 2,000 13,398 8,356 23,102 68,957 7,978 190 1,042 52,303 400 81 478 2,734 2,214 2,198 10,858 21,343 42 276 4,136 18,623 0 0 147 704 3,54fi 3,371 8,030 75,971 5,460 0 243,578 5 26,176 0 3,718 0 74,421 0 20,535 0 10,056 0 147,260 98 89 33,010 2,862 0 433 131 0 1,836 0 946 1,561 718 5,759 55,530 0 4,109 1,012 850 744 565 920 5,298 2,821 109 2,219 4,029 0 1,100 14,007 652 11,490 8,845 8,056 338,600 34,159 5,877 83,893 27,023 25,163 170,181 9,844 331,588 86,603 10,142 119,760 61,961 21,667 206,126 132,564 5,254,131 650,218 84,453 1,432,327 551,562 389,457 2,492,900 11.99 11.44 10.53 15.73 12.30 12.76 11.84 12.05 86.52 86.42 88.43 79.07 84.69 84.80 84.07 86.64 Ratios: Net income before dividends to capital accounts (percent) .. Total operating expense to total operating revenue (percent) See footnotes at end of table. N3 Digitized for Co FRASER 8 00 TABLE B-32—Continued Income and expenses of National banks,* by States, year ended Dec. 31, 1974 [Dollar amounts in thousands] Rhode Island Number of banks Operating income: Interest and fees on loans Income on Federal funds sold and securities purchased under agreements to resell Interest and dividends on investments: U.S. Treasury securities Obligations of other U.S. Government agencies and corporations Obligations of States and political subdivisions Other securities Trust department income Service charges on deposit accounts Other service charges, collection and exchange charges, commissions, and fees Other operating income Total operating income Operating expense: Salaries and wages of officers and employees Pensions and other employee benefits Interest on deposits Expense of Federal funds purchased and securities sold under agreements to repurchase Interest on borrowed money Interest on capital notes and debentures Occupancy expense of bank premises, net Furniture and equipment, depreciation, rental costs, servicing, etc Provision for loan losses (or actual net loan losses) Other operating expenses Total operating expense Income before income taxes and securities gains or losses Applicable income taxes Income before securities gains or losses Net securities gains or losses (after tax effect) Net income before extraordinary items Extraordinary charges or credits Minority interest in consolidated subsidiaries Net income South Carolina South Dakota Tennessee Texas Utah Vermont Virginia 18 31 75 569 11 17 109 $175,762 $133,092 $82,833 $476,607 $1,647,180 $93,941 $20,483 $531,908 4,555 16,152 3,035 33,720 254,258 7,368 1,688 26,402 4,908 7,660 6,849 30,652 110,962 5,576 1,228 27,041 6,037 9,344 494 8,922 3,158 4,754 12,009 287 4,112 9,078 4,502 10,924 680 1,304 3,804 21,115 44,048 4,528 11,603 15,849 64,664 220,313 10,915 50,220 52,812 1,526 6,854 332 1,799 4,645 432 2,273 196 226 874 18,100 50,698 1,622 13,471 11,465 4,358 8,526 3,601 5,037 3,527 860 17,745 21,964 53,198 54,081 5,436 706 298 326 15,948 10,800 226,064 195,782 118,318 677,831 2,518,603 128,183 28,024 707,455 27,904 6,752 102,764 44,853 7,876 47,116 15,251 3,090 57,515 99,111 15,976 273,870 305,243 51,804 968,176 20,150 3,061 52,641 5,140 920 12,764 103,656 18,598 291,980 21,798 3,391 313 6,236 13,478 285 774 5,782 1,193 448 834 2,620 83,331 11,076 1,420 19,037 327,614 33,464 6,851 45,823 7,982 2,366 1,285 2,611 58 27 34 993 42,017 5,134 2,240 19,041 2,988 6,864 24,033 7,098 5,534 24,998 2,950 3,136 10,207 21,891 52,076 68,436 49,328 67,589 254,875 3,335 2,151 13,025 827 394 3,141 15,616 24,006 95,780 203,043 157,794 97,244 646,224 2,110,767 108,607 24,298 618,068 23,021 6,177 16,844 - 304 16,540 0 0 37,988 12,314 25,674 - 40 25,634 + 38 0 21,074 5,172 15,902 -259 15,643 + 1 0 31,607 2,384 29,223 - 1,227 27,996 + 285 + 11 407,836 87,028 320,808 - 2,158 318,650 + 971 - 7 19,576 5,890 13,686 - 27 13,659 0 0 3,726 647 3,079 + 13 3,092 + 26 0 89,387 17,748 71,639 - 2,697 68,942 - 21 0 16,540 25,672 15,644 28,292 319,614 13,659 3,118 68,921 Changes in capital accounts: Increases: Net income transferred to undivided profits Capital stock, notes and debentures sold or issued including premium received Addition to surplus, undivided profits and reserves incident to mergers and consolidations Transfers from reserves on loans and securities All other increases 16,540 25,672 15,644 28,292 319,614 13,659 3,118 68,921 0 1,867 858 17,599 51,479 0 1,935 36,933 0 820 429 3,284 527 77 594 0 579 1,322 2,666 5,679 14,415 4,146 22,369 5 0 44 1,824 2 353 6,840 4,058 10,491 1,249 5,755 2,031 27,266 92,409 49 4,114 58,322 7,984 0 8,309 0 5,175 0 21,332 0 87,232 0 6,370 0 1,211 21 33,212 0 0 0 40 65 6,239 0 45 105 0 1,064 948 1,000 292 314 0 613 645 125 1,617 3,585 1,217 19,580 25,334 0 796 168 749 236 329 155 1,841 2,515 9,996 9,915 6,473 26,724 139,602 7,334 2,591 37,828 7,793 21,512 11,202 28,834 272,421 6,374 4,641 89,415 76,825 201,123 108,448 572,768 2,301,373 111,223 31,515 604,406 Ratios: Net income before dividends to capital accounts (percent) . . . 9.35 12.76 14.43 4.94 13.89 12.28 9.89 11.40 Total operating expense to total operating revenue (percent) . 89.82 80.60 82.19 95.34 83.81 84.73 86.70 87.36 Total increases Decreases: Cash dividends declared: On common stock On preferred stock Capital stock, notes and debentures, retired including premium paid Reduction in surplus, undivided profits and reserves incident to mergers and consolidations Transfers to reserves on loans and securities All other decreases Total decreases Net change in capital accounts Capital accountst See footnotes at end of table. to Digitized 00 for FRASER N3 TABLE B-32—Continued Income and expenses of National banks,* by States, year ended Dec. 31, 1974 [Dollar amounts in thousands] Washington Number of banks Operating income: Interest and fees on loans Income on Federal funds sold and securities purchased under agreements to resell Interest and dividends on investments: U.S. Treasury securities Obligations of other U.S. Government agencies and corporations Obligations of States and political subdivisions Other securities Trust department income Service charges on deposit accounts Other service charges, collection and exchange charges, commissions, and fees Other operating income Total operating income Operating expense: Salaries and wages of officers and employees Pensions and other employee benefits Interest on deposits Expense of Federal funds purchased and securities sold under agreements to repurchase Interest on borrowed money Interest on capital notes and debentures Occupancy expense of bank premises, net Furniture and equipment, depreciation, rental costs, servicing, etc Provision for loan losses (or actual net loan losses) Other operating expenses Total operating expense Income before income taxes and securities gains or losses Applicable income taxes Income before securities gains or losses Net securities gains or losses (after tax effect) Net income before extraordinary items Extraordinary charges or credits Minority interest in consolidated subsidiaries Net income West Virginia Wisconsin Wyoming Virgin Islands Puerto Rico District of Columbia — allt 23 100 128 44 1 1 16 $484,652 $120,542 $392,651 $55,055 $1,807 $8,861 $208,807 75,774 31,380 40,775 3,507 198 538 19,397 23,446 18,665 24,231 5,942 174 91 23,611 10,675 38,335 1,523 13,973 28,238 12,570 21,994 912 2,881 2,345 17,470 33,818 2,976 9,792 7,982 3,399 7,223 352 636 2,319 0 20 493 0 91 0 49 11 0 85 4,049 18,092 1,482 11,712 8,754 24,214 23,901 2,698 3,442 17,941 10,654 1,740 1,058 6 37 270 374 5,298 6,074 724,731 217,429 558,290 81,231 2,826 10,279 307,276 128,383 22,727 249,718 27,269 4,011 88,727 72,479 14,617 251,196 11,540 1,798 36,772 305 40 1,571 1,863 278 5,659 55,386 9,952 96,102 111,810 5,717 413 25,056 24,494 305 442 4,627 67,383 3,787 3,249 17,999 2,047 919 536 1,826 0 3 0 102 132 0 0 462 17,833 3,142 658 11,714 17,566 15,286 73,548 5,001 4,777 22,679 14,243 19,086 45,888 1,516 1,738 8,509 23 124 454 273 382 614 6,754 5,865 30,553 650,224 182,332 509,927 67,201 2,622 9,663 237,959 74,507 13,170 61,337 - 126 61,211 11,659 0 35,097 5,555 29,542 + 66 29,608 - 103 0 48,363 9,471 38,892 - 1,042 37,850 + 2,008 0 14,030 3,033 10,997 - 176 10,821 + 38 0 204 98 106 0 106 + 39 0 616 259 357 + 25 382 0 0 69,317 25,451 43,866 + 89 43,955 + 325 0 49,552 29,505 39,858 10,859 145 382 44,280 Changes in capital accounts: Increases: Net income transferred to undivided profits Capital stock, notes and debentures sold or issued including premium received Addition to surplus, undivided profits and reserves incident to mergers and consolidations Transfers from reserves on loans and securities All other increases Total increases 49,552 29,505 39,858 10,859 145 382 44,280 598 10,047 16,189 985 0 0 2,252 1,104 516 51 14 622 1,486 11,059 70 1,410 0 154 1,373 0 0 0 0 19 99 202 56 2,269 12,169 28,728 2,512 0 118 3,410 17,729 1 7,606 0 20,858 0 3,488 0 0 0 0 0 17,242 356 0 30 202 116 0 0 1,473 0 5,593 896 0 1,419 1,615 59 2,201 1,008 0 710 1,075 0 0 29 0 0 5 0 1,972 356 24,219 10,670 24,328 5,389 29 5 21,399 27,602 31,004 44,258 7,982 116 495 26,291 477,485 238,402 469,554 79,642 2,007 8,045 336,034 Ratios: Net income before dividends to capital accounts (percent) . .. 10.38 12.38 8.49 13.63 7.22 4.75 13.18 Total operating expense to total operating revenue (percent). . 89.72 83.86 91.34 82.73 92.78 94.01 77.44 Decreases: Cash dividends declared: On common stock On preferred stock .. .... .... Capital stock, notes and debentures, retired including premium paid Reduction in surplus, undivided profits and reserves incident to mergers and consolidations Transfers to reserves on loans and securities All other decreases Total decreases Net change in capital accounts Capital accounts! 900 * Includes all banks operating as National banks at year-end and full-year data for those State banks converting to National banks during the year. t Includes aggregate book value of debentures, preferred stock, common stock, surplus, undivided profits, and reserves. Excepting Puerto Rico, these are averages from the June and December call dates in the year indicated and the previous December call date. X Includes National and non-National banks in the District of Columbia, all of which are supervised by the Comptroller of the Currency. NOTE: Data may not add to totals because of rounding. to TABLE B-33 Income and expenses of National banks,* by deposit size, year ended Dec. 31, 1974 [Dollar amounts in thousands] Total Number of banks 4708 Operating income: $28,418,563 Interest and fees on loans Income on Federal funds sold and securities purchased 2,173,089 under agreements to resell Interest and dividends on investments: 1,752,716 U.S. Treasury securities Obligations of other U.S. Government agencies 1,018,360 and corporations Obligations of States and political subdivisions . . 2,531,299 Other securities 258,901 Trust department income 853,728 Service charges on deposit accounts 827,191 Other service charges, collection and exchange charges, 938,515 commissions, and fees 1,675,980 Other operating income Total operating income 40,448,342 Banks operating full year with deposits in December 1974, of — Over $2,000.0 $5,000.1 $10,000.1 $25,000.1 $50,000.1 $100,000.1 $2,000.1 and under to $5,000.0 to $10,000.0 to $25,000.0 to $50,000.0 to $100,000.0 o $500,000.0 $500,000.0 74 360 743 1,666 888 490 369 118 $2,538 $54,816 $251,007 $1,296,464 $1,596,627 $1,795,940 $4,484,143 $18,937,028 2,111 18,425 55,003 185,185 166,104 163,730 442,797 1,139,734 1,307 14,756 49,202 197,123 181,618 173,953 344,415 790,342 384 78 137 182 7,443 4,170 1,102 907 3,927 30,292 30,455 2,828 1,746 15,411 122,731 192,529 15,527 4,828 75,424 117,897 241,996 19,469 17,621 79,567 121,344 258,937 23,412 42,442 79,687 202,127 542,039 53,553 165,059 161,529 416,142 1,261,095 142,873 621,125 411,464 89 204 2,303 1,359 7,402 4,828 36,137 24,954 43,110 30,284 49,731 34,871 180,052 126,533 619,691 1,452,947 7,030 109,208 448,174 2,150,902 2,494,293 2,744,047 6,702,247 25,792,441 Operating expense: Salaries and wages of officers and employees Pensions and other employee benefits Interest on deposits Expense of Federal funds purchased and securities sold under agreements to repurchase Interest on borrowed money Interest on capital notes and debentures Occupancy expense of bank premises, net Furniture and equipment, depreciation, rental costs, servicing, etc Provision for loan losses (or actual net loan losses) .. Other operating expenses 2,294 238 1,270 24,949 2,949 35,179 83,595 11,373 171,385 352,844 55,604 909,736 392,382 65,658 1,094,369 432,658 74,398 1,222,181 1,053,775 186,908 2,737,496 10,413,364 4,277,220 519,256 147,782 1,146,564 60 244 188 56 4,145 1,563 717 387 13,527 11,896 4,459 3,719 62,690 36,699 6,416 6,045 76,538 71,704 11,531 9,331 90,337 513,842 42,074 27,058 224,799 3,641,272 453,811 101,186 674,061 467 636,863 300 139 2,047 6,815 3,421 3,335 17,945 11,106 12,850 58,239 51,896 58,591 255,623 61,306 68,654 290,568 68,807 65,298 309,987 186,667 187,467 726,842 428,394 995,471 2,073,671 92,411 364,742 1,767,058 2,098,635 2,356,232 5,886,928 22,668,621 5,206,900 1,122,623 4,084,277 - 42,420 4,041,857 + 2,758 - 141 215 222 -7 - 25 - 32 + 26 16,797 5,161 11,636 -3 11,633 + 29 83,432 22,326 61,106 - 546 60,560 + 199 383,844 88,550 295,294 - 2,651 292,643 4- 1,745 - 11 395,658 77,945 317,713 - 2,060 315,653 + 710 -1 387,815 66,108 321,707 - 2,658 319,049 + 1,567 - 16 815,319 134,937 680,382 - 5,020 675,362 + 3,226 - 13 3,123,820 727,374 2,396,446 - 29,457 2,366,989 - 4,744 - 100 Net income 4,044,474 -6 11,662 60,759 294,377 316,362 320,600 678,575 2,362,145 Cash dividends declared: On common stock On preferred stock 1,670,232 977 166 3,260 15,067 75,982 11 101,268 103 115,072 25 295,582 481 1,063,835 357 1,671,209 166 3,260 15,067 75,993 101,371 115,097 296,063 1,064,192 Total operating expense Income before income taxes and securities gains or losses Applicable income taxes Income before securities gains or losses Net securities gains or losses (after tax effect) Net income before extraordinary items Extraordinary charges or credits Minority interest in consolidated subsidiaries . Total cash dividends declared 811,897 1,391,805 3,734,922 35,241,442 * Includes all banks operating as National banks at year-end, and full-year data for those State banks converting to National banks during the year. NOTE: Data may not add to totals because of rounding. Dashes indicate amounts less than $500. ISO 3,250,528 5,593,025 1,033,991 16,584,980 to TABLE B-34 Capital accounts, net income, and dividends of National banks, 1944-1974 [Dollar amounts in thousands] Year (last call) 1944 1945 1946 1947 1948 1949 1950 1951 1952 1953 1954 1955 1956 1957 1958 1959 I960 1961 1962 1963 1964 1965 1966 1967 1968 1969 1970 1971 1972 1973 1974 5,031 5,023 4,013 5,011 4,997 4,981 4,965 4,946 4,916 4,864 4,796 4,700 4,659 4,627 4,585 4,542 4,530 4,513 4,503 4,615 4,773 4,815 4,799 4,758 4,716 4,669 4,621 4,600 4,614 4,661 4,708 Preferred $110,597 80,672 53,202 32,529 25,128 20,979 16,079 12,032 6,862 5,512 4,797 4,167 3,944 3,786 3,332 3,225 2,050 2,040 9,852 24,304 27,281 28,697 29,120 38,081 57,704 62,453 62,572 56,761 42,627 38,660 26,705 Common $1,440,519 1,536,212 1,646,631 1,736,676 1,779,362 1,863,373 1,949,898 2,046,018 2,171,026 2,258,234 2,381,429 2,456,454 2,558,111 2,713,145 2,871,785 3,063,407 3,257,208 3,464,126 3,662,603 3,861,738 4,135,789 4,600,390 5,035,685 5,224,214 5,503,820 6,165,757 6,326,508 6,640,849 7,132,092 7,676,452 8,178,696 Total $1,551,116 1,616,884 1,699,833 1,769,205 1,804,490 1,884,352 1,965,977 2,058,050 2,177,888 2,263,746 2,386,226 2,460,621 2,562,055 2,716,931 2,875,117 3,066,632 3,259,258 3,466,166 3,672,455 3,886,042 4,163,070 4,629,087 5,064,805 5,262,295 5,561,524 6,228,210 6,389,080 6,697,610 7,174,719 7,715,112 8,205,401 Ratios (percent) Cash dividends Capital stock (par value)* Number of banks Total capital accounts* $4,114,972 4,467,618 4,893,038 5,293,267 5,545,993 5,811,044 6,152,799 6,506,378 6,875,134 7,235,820 7,739,553 7,924,719 8,220,620 8,769,839 9,412,557 10,003,852 10,695,539 11,470,899 12,289,305 13,102,085 14,297,834 16,111,704 17,971,372 19,095,324 20,585,402 22,158,066 24,080,719 25,986,802 28,714,775 31,787,879 34,646,893 Net income before dividends $411,844 490,133 494,898 452,983 423,757 474,881 537,610 506,695 561,481 573,287 741,065 643,149 647,141 729,857 889,120 800,311 1,046,419 1,042,201 1,068,843 1,205,917 1,213,284 1,387,228 1,582,535 1,757,491 1,931,556 2,534,029 2,829,334 3,041,122 3,307,906 3,767,667 4,044,474 On preferred stock $5,926 4,131 2,427 1,372 1,304 1,100 712 615 400 332 264 203 177 171 169 165 99 119 202 1,126 1,319 1,453 l,34fl 2,124 4,344 4,428 4,677 4,011 2,703 2,398 977 On common stock $139,012 151,525 167,702 182,147 192,603 203,644 228,792 247,230 258,663 274,884 299,841 309,532 329,777 363,699 392,822 422,703 450,830 485,960 517,546 547,060 591,491 681,802 736,591 794,056 892,934 1,063,647 1,273,039 1,386,166 1,307,628 1,446,994 1,670,232 Net income before dividends to total capital accounts Cash dividends to net income before dividends Cash dividends on preferred stock to preferred capital 10.01 10.97 10.11 8.56 7.64 8.17 8.74 7.79 8.17 7.92 9.58 8.12 7.87 8.32 9.45 8.00 9.78 9.09 8.70 9.20 8.49 8.61 8.81 9.20 9.38 11.44 11.75 11.70 11.52 11.85 11.67 35.04 31.76 34.38 40.51 45.76 43.11 42.69 49.04 46.14 48.01 40.50 48.16 50.99 49.85 44.20 52.84 43.09 46.64 48.44 45.46 48.86 49.25 46.63 45.30 46.45 42.15 45.16 45.71 39.61 38.47 41.32 4.79 5.12 4.56 4.22 5.19 5.24 4.43 5.11 5.83 6.02 5.50 4.87 4.49 4.52 5.07 5.12 4.83 5.83 2.05 4.63 4.83 5.06 4.63 5.58 7.53 7.09 7.46 7.07 6.34 6.20 3.66 * These are averages of data from the reports of condition of the previous December, and June and December of the respective years. t Ratios for years 1963 through 1973 inclusive have been restated to reflect removal of capital notes and debentures. NOTE: For earlier data, see Annual Reports of the Comptroller of the Currency, 1938, p. 115, and 1963, p. 306. Cash dividends to total equity capital^ 3.53 3.48 3.4£ 3.47 3.50 3.52 3.73 3.81 3.77 3.80 3.88 3.91 4.01 4.15 4.18 4.23 4.22 4.24 4.21 4.19 4.22 4.46 4.38 4.45 4.65 5.09 5.57 5.63 4.87 4.89 5.16 TABLE B-35 Loan losses and recoveries of National banks, 1945-1974 [Dollar amounts in thousands] Year 1945 1946 1947 1948 1949 1950 1951 1952 1953 1954 1955 1956 1957 1958 1959 I960 Total loans, end of year, net $13,94«,042 17,309,767 21,480,457 23,818,513 23,928,293 29,277,480 32,423,777 36,119,673 37,944,146 39,827,678 43,559,726 48,24#,332 50,502,277 52,796,224 59,961,989 63,693,668 Ratio of net Net losses or losses or net recoveries (+) recoveries (+) to loans +$7,740 3,207 29,913 19,349 33,199 14,445 22,108 19,326 32,201 25,674 29,478 41,006 35,428 38,173 25,767 130,177 Percent +0.06 .02 .14 .08 .14 .05 .07 .05 .08 .06 .07 .08 .07 .07 .04 .20 Year Total loans, end of year, net Ratio of net Net losses or losses or net recoveries (+) recoveries (+) to loans Percent 1961 1962 1963 1964 1965 1966 1967 1968 1969 1970 1971 1972 1973 1974 Average for 1945-74 $67,308,734 75,548,316 83,388,446 95,577,392 116,833,479 126,881,261 136,752,887 154,862,018 168,004,686 173,456,091 190,308,412 226,354,896 266,937,532 292,732,965 $112,412 97,617 121,724 125,684 189,826 240,880 279,257 257,280 303,357 601,734 666,190 545,473 731,633 1,193,730 0.17 .13 .15 .13 .16 .19 .20 .17 .18 .35 .35 .24 .27 .41 92,326,239 198,617 .22 NOTE: For earlier data, including figures on gross losses and chargeoffs and gross recoveries, see Annual Reports of the Comptroller of the Currency, 1947, p. 100 and 1968, p. 233. TABLE B-36 Securities losses and recoveries of National banks, 1945-1974 [Dollar amounts in thousands] Year 1945 1946 1947 1948 1949 1950 1951 1952 1953 1954 1955 1956 1957 1958 1959 1960 Total securities, end of year, net $55,611,609 46,642,816 44,009,966 40,228,353 44,207,750 43,022,623 43,043,617 44,292,285 44,210,233 48,932,258 42,857,330 40,503,392 40,981,709 46,788,224 42,652,855 43,852,194 Losses and chargeoffs* $74,627 74,620 69,785 55,369 23,595 26,825 57,546 76,524 119,124 49,469 152,858 238,997 151,152 67,455 4^3,526 154,372 Ratio of net losses to securities Percent 0.04 .09 .10 .07 .04 .04 .12 .15 .25 .08 .32 .56 .35 .12 1.09 .30 Year Total securities, end of year, net Losses and chargeoffs* Ratio of net losses to securities Percent 1961 1962 1963 1964 1965 1966 1967 1968 1969 1970 1971 1972 1973 1974 Average for 1945-74 $49,093,539 51,705,503 52,601,949 54,366,781 57,309,892 57,667,429 69,656,371 76,871,528 70,216,983 84,157,505 95,948,647 103,658,543 104,606,665 106,930,804 $51,236 47,949 45,923 86,500 67,898 302,656 149,545 344,068 286,215 137,704 + 189,347 +94,506 36,738 43,469 0.08 .08 .07 .15 .11 .52 .21 .44 .41 .16 + .20 + .09 .04 .04 58,220,978 106,396 .18 * Excludes transfers to and from valuation reserves beginning in 1948. NOTE: For earner data, including figures on gross losses and chargeoffs and gross recoveries, see Annual Reports of the Comptroller of the Currency, 1947, p. 100 and 1968, p. 234. 245 TABLE B-37 Ratios of classified assets to total loans for National banks, deposit size category under $100 million Latest examination in — Classified assets as a percent of total loans 1968 Number of banks Percent Number of banks Percent Number of banks Percent Number of banks Percent Number of banks 1974 1973 1972 1971 1970 1969 Percent Number of banks Percent Number of banks Percent 2,124 0-.9 899 1-1.9 518 2-2.9 303 3-3.9 186 4-4.9 126 5-5.9 75 6-6.9 50 7-7.9 151 8.0 and over .. 47.9 20.3 11.7 6.8 4.2 2.8 1.7 1.1 3.4 2,099 953 488 321 180 108 65 48 118 47.9 21.8 11.1 7.3 4.1 2.5 1.5 1.1 2.7 1,779 971 560 354 219 135 89 62 143 41.3 22.5 13.0 8.2 5.1 3.1 2.1 1.4 3.3 1,716 945 599 364 235 118 77 50 138 40.5 22.3 14.1 8.6 5.5 2.8 1.8 1.2 3.3 1,839 1,006 608 314 182 97 59 45 80 43.5 23.8 14.4 7.4 4.3 2.3 1.4 1.1 1.9 2,005 958 578 287 161 79 47 28 73 47.5 22.7 13.7 6.8 3.8 1.9 1.1 0.7 1.7 1,741 961 603 363 183 128 66 45 118 41.4 22.8 14.3 8.6 4.3 3.0 1.6 1.1 2.8 Total . . . . 4,432 100.0 4,380 100.0 4,312 100.0 4,242 100.0 4,230 100.0 4,217 100.0 4,208 100.0 TABLE R-38 Ratios of classified assets to total loans for National banks, deposit size category $100 million and over Latest examination in — Classified assets as a percent of total loans 1968 Number of banks 1969 Percent Number of banks 1970 Percent Number of banks Percent Number of banks Percent Number of banks 1974 1973 1972 1971 Percent Number of banks Percent Number of banks Percent 0-.9 1-1.9 2-2.9 3-3.9 4-4.9 5-5.9 6-6.9 7-7.9 8.0 and over .. 146 74 44 12 9 6 3 2 4 48.7 24.7 14.7 4.0 3.0 2.0 1.0 0.7 1.3 159 76 49 9 7 5 2 1 3 51.1 24.4 15.8 2.9 2.3 1.6 0.6 0.3 1.0 98 84 65 26 16 14 8 1 8 30.6 26.3 20.3 8.1 5.0 4.4 2.5 0.3 2.5 119 90 67 37 21 10 6 4 10 32.7 24.7 18.4 10.2 5.8 2.7 1.6 1.1 2.7 151 88 81 29 12 13 5 3 6 38.9 22.7 20.9 7.5 3.1 3.4 1.3 0.8 1.5 161 130 77 30 16 8 4 2 6 37.1 30.0 17.7 6.9 3.7 1.8 0.9 0.5 1.4 118 103 88 57 27 18 6 4 18 26.9 23.5 20.0 13.0 6.2 4.1 1.4 0.9 4.1 Total . . . . 300 100.0 311 100.0 320 100.0 364 100.0 388 100.0 434 100.0 439 100.0 246 TABLE B-39 Assets and liabilities of National banks, date of last report of condition, 1950-1974 [Dollar amounts in thousands] Year Number of banks 1950 1951 1952 1953 1954 1955 1956 1957 1958 1959 1960 1961 1962 1963 1964 1965 1966 1967 1968 1969 1970 1971 1972 1973 1974 . . . . . . . . . . . . . . . . . . . . . . . . . 4,965 4,946 4,916 4,864 4,796 4,700 4,659 4,627 4,585 4,542 4,530 4,513 4,505 4,615 4,773 4,815 4,799 4,758 4,716 4,669 4,621 4,600 4,614 4,661 4,708 Total assets * $97,240,093 102,738,560 108,132,743 110,116,699 116,150,569 113,750,287 117,701,982 120,522,640 128,796,966 132,636,113 139,260,867 150,809,052 160,657,006 170,233,363 190,112,705 219,102,608 235,996,034 263,374,709 296,593,618 310,263,170 337,070,049 372,538,487 430,768,064 484,887,096 529,232,286 Cash and due from banks Total securities, Loans, net $23,813,435 26,012,158 26,399,403 26,545,518 25,721,897 25,763,440 27,082,497 26,865,134 26,864,820 27,464,245 28,674,506 31,078,445 29,683,580 28,634,500 34,065,854 36,880,248 41,689,580 46,633,658 50,952,691 54,727,953 56,040,460 59,200,995 67,401,118 70,723,613 76,556,699 $43,022,623 43,043,617 44,292,285 44,210,233 48,932,258 42,857,330 40,503,392 40,981,709 46,788,224 42,652,855 43,852,194 49,093,539 51,705,503 52,601,949 54,366,781 57,309,892 57,667,429 69,656,371 76,871,528 70,030,342 84,157,465 95,948,647 103,658,543 104,606,665 106,930,804 net Other assets Total deposits $29,277,480 32,423,777 36,119,673 37,944,146 39,827,678 43,559,726 48,248,332 50,502,277 52,796,224 59,961,989 63,693,668 67,308,734 75,548,316 83,388,446 95,577,392 116,833,479 127,453,846 136,752,887 154,862,018 168,004,686 173,455,791 190,308,412 226,354,896 266,937,532 292,732,965 $1,126,555 1,259,008 1,321,382 1,416,802 1,668,736 1,569,791 1,867,761 2,173,520 2,347,698 2,557,024 3,040,499 3,328,334 3,719,607 5,608,468 6,102,678 8,078,989 9,185,179 10,331,793 13,907,381 17,500,189 23,416,333 27,080,433 33,353,507 42,619,286 53,011,818 $89,529,632 94,431,561 99,257,776 100,947,233 106,145,813 104,217,989 107,494,823 109,436,311 117,086,128 119,637,677 124,910,851 135,510,617 142,824,891 150,823,412 169,616,780 193,859,973 206,456,287 231,374,420 257,883,926 256,426,791 283,784,496 314,211,616 359,427,154 395,880,964 431,225,358 Liabilities for borrowed money $76,644 15,484 75,921 14,851 11,098 107,796 18,654 38,324 43,035 340,362 110,590 224,615 1,635,593 395,201 299,308 172,087 1,015,147 296,821 689,087 2,283,717 1,280,365 866,103 2,370,204 3,721,870 3,285,509 Other liabilities^ Capital $1,304,828 1,621,397 1,739,825 1,754,099 1,889,416 1,488,573 1,716,373 1,954,788 1,999,002 2,355,957 3,141,088 3,198,514 3,446,772 5,466,572 5,148,422 7,636,524 9,975,692 11,973,852 16,496,707 28,284,638 27,130,131 30,387,265 38,616,017 52,149,689 58,891,284 $2,001,650 2,105,345 2,224,852 2,301,757 2,485,844 2,472,624 2,638,108 2,806,213 2,951,279 3,169,742 3,342,850 3,577,244 3,757,646 4,029,243 4,789,943 6,089,792 6,299,133 6,602,519 7,008,482 7,347,948 7,680,597 8,277,752 9,629,168 10,140,173 10,607,205 Surplus, undivided profits and reserves $4,327,339 4,564,773 4,884,369 5,107,759 5,618,398 5,463,305 5,834,024 6,278,004 6,717,522 7,132,375 7,755,488 8,298,062 8,992,104 9,518,935 10,258,252 11,334,232 12,159,775 13,127,097 14,515,416 15,906,249 17,194,460 18,794,699 20,722,810 22,994,400 25,222,930 * After deduction of securities and loan reserves. t Beginning in 1973, includes minority interest in consolidated subsidiaries. NOTE: For earlier data, revised for certain years and made comparable to those in this table, references should be made as follows: years 1863 to 1913, inclusive Annual Report of the Comptroller of the Currency, 1913; figures 1914 to 1919, inclusive, report for 1936; figures 1920 to 1939, inclusive, report for 1939; and figures 1936 to 1949, inclusive, report for 1966. TABLE B-40 Foreign branches of National banks, by region and country, Dec. 31, 1974 Region and country Number Central America 48 El Salvador Guatemala Honduras Mexico Nicaragua Panama 1 3 3 5 4 32 South America 131 Argentina Bolivia Brazil Colombia Ecuador Guyana Paraguay Peru Uruguay Venezuela 37 3 19 36 15 1 5 6 5 4 West Indies (Caribbean) Antigua Bahamas Barbados British Virgin Islands Cayman Islands Dominican Republic French West Indies Grenada Haiti Jamaica Montserrat Netherlands Antilles St. Lucia Trinidad and Tobago West Indies Federation of States Europe Austria Belgium England France Germany Greece Ireland Italy Luxembourg Region and country Europe - Continued Monaco Netherlands Northern Ireland Scotland Switzerland Africa Kenya Liberia Mauritius Middle East 248 17 Bahrain Israel Jordan Lebanon Qatar Saudi Arabia Trucial States 156 1 64 6 3 33 18 3 1 4 8 1 4 1 6 3 129 1 6 33 13 24 18 4 8 6 Asia and Pacific Brunei Fiji Islands Hong Kong India Indonesia Japan Korea Malaysia Pakistan Philippines Republic of China Singapore Thailand Vietnam U.S. overseas areas and trust territories American Samoa Canal Zone (Panama) Caroline Islands Guam Marianas Islands Marshall Islands Puerto Rico Virgin Islands Total Number 110 3 5 24 11 6 23 3 5 4 4 4 13 2 3 53 1 2 1 7 1 1 22 18 649 TABLE B-41 Total assets of foreign branches* of National banks, year-end 1953-1974 [Dollar amounts in thousands] 1953 1954. 1955. 1956. 1957. 1958. 1959. 1960. 1961. 1962. 1963. $1,682,919 1,556,326 1,116,003 1,301,883 1,342,616 1,405,020 1,543,985 1,628,510 1,780,926 2,008,478 2,678,717 1964 1965 1966 1967 1968 1969 1970 1971 1972 1973 1974 $3,319,879 7,241,068 9,364,278 11,856,316 16,021,617 28,217,139 38,877,627 50,550,727 54,720,405 83,304,441 99,810,999 Includes military facilities operated abroad by National banks from 1966 through 1971. TABLE B-42 Foreign branches of National banks, 1960-1974 End of year National bank Number of branches branches as a operated by percentage of total National banks foreign branches of U.S. banks 1960 1961 1962 1963 1964 1965 1966 1967 93 102 111 124 138 196 230 278 75.0 75.6 76.6 77.5 76.7 93.5 94.3 95.5 TABLE End of year National bank branches as a Number of branches percentage of total operated by foreign branches National banks of U.S. banks 1968 1969 1970 1971 1972 1973 1974 355 428 497 528 566 621 649 95.0 93.0 92.7 91.5 90 2 89.5 89.4 B-43 Assets and liabilities of foreign branches of National banks, Dec. 31, 1974: consolidated statement [Dollar amounts in thousands] Assets Cash and cash items in process of collection Demand balances with other banks Time balances with other banks Securities Loans, discounts and overdrafts, etc Customers' liability on acceptances outstanding . . Customers' liability on deferred payment letters of credit Premises, furniture and fixtures Accruals—interest earned, foreign exchange profits, etc Due from other foreign branches of this bank . . . . Due from head office and its domestic branches . . Other assets Total assets Liabilities $453,251 2,335,036 32,778,114 1,106,170 42,383,397 3,735,743 70,607 241,447 2,098,678 10,514,795 3,378,116 715,645 $99,810,999 Demand deposits Time deposits Liabilities for borrowed money Acceptances executed Deferred payment letters of credit outstanding . . . Reserve for interest, taxes and other accrued expenses Other liabilities Due to other foreign branches of this bank Due to head office and its domestic branches . . . . Total liabilities $7,479,349 71,319,752 2,019,570 3,773,765 56,917 2,130,848 488,743 9,922,867 2,619,188 $99,810,999 Memoranda Letters of credit outstanding $4,086,326 Future contracts to buy foreign exchange and bullion $41,564,993 Future contracts to sell foreign exchange and bullion $50,601,286 249 TABLE B-44 Trust assets* and income of National banks, by States, calendar 1974 [Dollar amounts in millions] Number of banks United States II Alabama Alaska Arizona Arkansas California Colorado Connecticut , Delaware District of Columbia || Florida Georgia Hawaii Idaho Illinois , Indiana Iowa Kansas Kentucky , Louisiana Maine Maryland Massachusetts Michigan Minnesota Mississippi Missouri Montana Nebraska Nevada New Hampshire New Jersey New Mexico New York North Carolina North Dakota Ohio Oklahoma Oregon Pennsylvania Rhode Island ., South Carolina South Dakota Tennessee Texas Utah Vermont Virginia Washington West Virginia Wisconsin Wyoming Puerto Rico , Virgin Islands Other Employee benefit trust account st accounts^ Total trust accounts Total Agency trust and accounts^ agency accounts Trust department income (Dollar amounts in thousands) 1,795 $57,253 $84,653 $141,906 $40,919 $182,824 $858,713 31 4 2 37 13 32 9 0 6 98 31 0 3 177 98 53 55 53 23 16 11 56 42 23 23 42 15 22 3 22 66 19 76 15 12 67 46 2 113 4 7 11 30 157 2 7 51 10 37 46 17 0 0 364 40 245 75 7,139 711 4SS 0 443 358 756 0 63 6,215 593 156 131 76 278 42 148 3,303 4,773 1,253 70 961 15 237 24 12 373 34 14,203 1,172 42 2,121 629 296 4,830 352 145 33 334 2,434 107 2 313 477 42 341 7 0 0 1,062 46 718 300 8,522 1,322 1,572 0 1,209 3,845 1,147 0 128 6,403 2,425 628 597 421 341 226 638 3,383 2,631 1,702 245 2,544 87 653 325 223 1,736 229 8,705 1,732 145 4,934 1,003 662 8,139 1,032 408 127 1,432 5,399 200 22 1,272 1,598 450 1,993 89 0 0 1,426 86 963 375 15,661 2,033 2,055 0 1,652 4,203 1,903 0 192 12,617 3,017 783 728 497 619 268 786 6,686 7,404 2,955 315 3,505 103 890 348 235 2,110 264 22,908 2,905 187 7,055 1,632 958 12,970 1,384 553 160 1,766 7,833 307 24 1,586 2,076 492 2,334 97 0 0 221 47 79 53 1,971 376 795 0 1,296 727 1,387 0 16 4,126 1,097 378 322 110 119 118 176 1,066 1,977 658 14 1,428 19 321 25 90 862 36 6,950 665 73 1,713 573 319 6,176 270 133 50 545 2,000 20 4 744 296 65 394 19 0 0 1,647 133 1,042 429 17,632 2,409 2,850 0 2,948 4,929 3,290 0 208 16,743 4,114 1,162 1,050 606 738 386 962 7,752 9,381 3,614 330 4,933 122 1,211 374 326 2,972 300 29,858 3,569 260 8,768 2,205 1,277 19,145 1,654 686 210 2,311 9,833 327 27 2,330 2,372 556 2,727 115 0 0 8,577 662 7,406 2,567 99,097 15,739 15,861 0 11,712 28,658 17,118 0 998 87,965 17,524 5,465 4,378 3,441 4,617 2,314 4,537 45,509 29,255 19,865 2,155 20,504 804 6,871 1,963 1,655 22,383 1,525 111,289 18,420 1,347 31,472 8,089 8,053 69,979 8,922 4,112 1,304 11,603 50,220 1,799 226 13,471 13,973 2,881 9,792 636 0 0 * As of December 31, 1974. t Employee benefit accounts include all accounts for which the bank acts as trustee, regardless of whether investments are partially, or wholly, directed by others. Insured plans or portions of plans funded by insurance are omitted, as are employee benefit accounts held as agent. $ Includes all accounts, except employee benefit accounts and corporate accounts, for which the bank acts in the following, or similar capacities: trustee (regardless of whether investments are directed by others), executor, administrator, guardian; omits all agency accounts and accounts for which the bank acts as registrar of stock and bonds, assignee, receiver, safekeeping agent, custodian, escrow agent, or similar capacities. § Includes both managing agency and advisory agency accounts. II Includes National and non-National banks in the District of Columbia, all of which are supervised by the Comptroller of the Currency. NOTE: Data may not add to totals because of rounding. Digitized250 for FRASER APPENDIX C Addresses and Selected Congressional Testimony Addresses and Selected Congressional Testimony Date and Topic Feb. 5, 1974, Remarks of James E. Smith, Comptroller of the Currency, before the American Bankers Association National Trust Conference, San Francisco, Calif May 8, 1974, Testimony by James E. Smith, Comptroller of the Currency, before the Subcommittee on Securities of the Senate Committee on Banking, Housing, and Urban Affairs, Washington, D.C May 8, 1974, Testimony by James E. Smith, Comptroller of the Currency, before the Subcommittee on Securities of the Senate Committee on Banking, Housing, and Urban Affairs, Washington, D.C June 27, 1974, Statement of James E. Smith, Comptroller of the Currency, before the Subcommittee on Budgeting, Management, and Expenditures and the Subcommittee on Inter-Governmental Relations of the Senate Committee on Government Operations, Washington, D.C July 31, 1974, Testimony by James E. Smith, Comptroller of the Currency, before the Subcommittee on Financial Institutions of the Senate Committee on Banking, Housing, and Urban Affairs, Washington, D.C Aug. 13, 1974, Testimony of James E. Smith, Comptroller of the Currency, before the Subcommittee on Securities of the Senate Committee on Banking, Housing, and Urban Affairs, Washington, D.C Nov. 11, 1974, Remarks of James E. Smith, Comptroller of the Currency, before the Robert Morris Associates Fall Business Conference Session, Atlanta, Ga Dec. 11, 1974, Testimony by James E. Smith, Comptroller of the Currency, before the Subcommittee on Bank Supervision and Insurance of the House Banking and Currency Committee, Washington, D.C Apr. 9, 1974, Remarks of Robert A. Mullin, Deputy Comptroller of the Currency, before the Bankers Association for Foreign Trade, San Diego, Calif May 13, 1974, and May 23, 1974, Remarks of David C. Motter, Deputy Comptroller of the Currency (Economics), before the Dun & Bradstreet Seminar for Bank Executives, Chicago, 111., and New York, N.Y Aug. 16, 1974, Remarks of Justin T. Watson, First Deputy Comptroller of the Currency, at the Graduation Ceremonies of the School of Banking of the University of Florida, Gainesville, Fla Sept. 12, 1974, Remarks of Justin T. Watson, First Deputy Comptroller of the Currency, before the Alabama Bankers Association, Gulf Shores, Ala Oct. 24, 1974, Remarks of Justin T. Watson, First Deputy Comptroller of the Currency, before a Symposium of the World Trade Institute, New York, N.Y Nov. 8, 1974, Remarks of Justin T. Watson, First Deputy Comptroller of the Currency, before the First Gold, Silver, and Foreign Exchange Seminar, Amsterdam, Netherlands Nov. 9, 1974, Remarks of David H. Jones, Special Assistant to the Comptroller (Strategic Policy Planning), before the Annual Homecoming Luncheon of the University of Texas at El Paso College of Business Administration, El Paso, Tex 252 Page 253 256 258 260 262 263 264 268 274 275 279 283 287 289 296 REMARKS OF JAMES E. SMITH, COMPTROLLER OF THE CURRENCY, BEFORE THE AMERICAN BANKERS ASSOCIATION NATIONAL TRUST CONFERENCE, SAN FRANCISCO, CALIF., FEB. 5, 1974 The leading public policy issue relating to the operation of trust departments by commercial banks concerns that conjunction itself. Vocal critics of bank trust operations have generated a rising chorus of demands that trust activity be divested completely from the commercial banking industry. That is not a new challenge, certainly, but it must be viewed by us from the new perspectives that have been created by a public that has become much more analytical in its approach to our institutions. It is no longer an academic exercise; it is a serious threat. Therefore, we must face this issue squarely. We begin with the observation that the relationship between banks and their trust departments is one which has endured for many generations. It should be severed only if there develop demonstrated abuses which can't be dealt with otherwise. The disadvantages to the public resulting from separation are many. Let me touch upon some of these. The first relates to the number of sources of trust services available to the public. At this time, commercial banks represent the most important corporate fiduciary. There are some 3,800 banks with trust powers. Were public policy to require commercial banks to leave the trust field, the number of corporate fiduciaries would decline drastically as that policy was effected. The trust business would then be handled entirely by individuals and by nonbank corporate fiduciaries. The inherent problems associated with individuals acting in a fiduciary capacity are well known. No individual enjoys the perpetual life of a corporation. No individual can possibly possess the comprehensive investing and management skills available in a large trust department. Individuals are not subject to any counterpart of bank trust department regulation. As to non-bank corporate fiduciaries, it appears not unlikely that, over time, with the disappearance of banks from the fiduciary area, the total number of corporate fiduciaries offering trust services would decline substantially. It is unrealistic to assume that one independent trust company would replace each bank department which is divested. An aggregation or conglomeration of several such units is much more apt to result because of capital requirements and the economies of scale that are inherent in the investment function of trust departments. Thus we see that the public would suffer a decline in the number of alternative sources of trust services, a probable decline in the average quality of services available, and a probable decline in competition in the offering of trust services. The second major disadvantage for the public in the separation of trust operations from commercial banks relates to capitalization. Currently, total bank capital of about $50 billion is available as a protection or cushion for trust beneficiaries. Non-bank corporate fiduciaries have a much smaller ratio of capital to the total trust assets managed. However a spinoff of trust operations from commercial banks were to be handled, there does not appear to be a conceivable way, let alone a practical way, of maintaining a capital cushion of the same magnitude now enjoyed by trust accounts. The third disadvantage to the public is a nonquantifiable one. It relates to the utility, that is, the degree of satisfaction, enjoyed by an individual establishing a trust when he is able, if he wishes, to utilize the services of one of many of well established commercial banks that enjoy a reputation for stability, continuity, and financial expertise. To remove the option of establishing a trust under the aegis of one of those institutions would appear to create a disutility that many critics of bank trust operations fail completely to take into consideration. On the other side of the coin, I think a bank benefits from having a trust department in a nonmaterial but very real manner. The trust department, with its strict adherence to sound fiduciary principles constitutes the pulse beat of conscience for a bank. By its very existence within the corporate structure of a bank, it radiates responsibility—a standard of duty for the entire operation to follow. That pulse beat hopefully resonates even through the "Chinese Wall" which now must exist between commercial and trust departments. I must point out here that I also do not find any compelling merit in the suggestions that trust depart253 ments should be spun off as affiliates in a bank holding company. The change effected by a spinoff to an affiliate would be slight indeed—only cosmetic at best. That is not to say that I object to spinoff of a trust department if a bank finds valid business reasons for such corporate restructuring; that is a matter of the bank's management judgment. But do not expect that such a separation will answer the call for divestiture. Let me emphasize that our Office is aware of the necessity of vigilant regulation of trust departments of National banks, so that we are able to give appropriate and soundly based rebuttals to the arguments of bank trust critics. It is also incumbent upon all of you, as trust officers, and upon us, as regulatory officials, to provide greater publicity concerning the comprehensiveness of bank regulatory procedures in the trust area. Too often we hear statements —and occasionally they even emanate from Congress—that would lead the listener to believe that trust departments are totally unregulated. You obviously know better, but we must strive to make the public aware of the situation. We need to point out, over and over again if necessary, the advantages that we see for the public in the continued operation of trust departments by commercial banks. At the same time we must recognize that if banks are to continue to have trust departments, several principles must be observed, some old, some new. Let me first deal with the old. It is no surprise to us that there are conflicts of interest between a bank's commercial operations and its trust department. It is a fact of life with which you have lived for years. In the process, banks have acquired a very real awareness of the precautions which must be taken so as to prevent the conflict from prejudicing the interests of the trust department customers, the commercial customers, the public, or the bank. Thus, it is not news to a banker that the business of the bank cannot be mixed with that of the trust department—that one cannot be used to serve the other to the disadvantage of the first. In addition, the monitoring of those conflicts of interest has been the primary target of trust department supervision by the banking agencies. It has been what the trust department examiner looks for. That is the primary concern of the regulations concerning trust departments. While those things are old hat to you and me, they are not always appreciated by the outsider. Yet, we cannot remain static in our mutual awareness of the problems which the conflicts of interest between a bank and its trust department pose. That 254 is because we do not live in a static society or economy. As various types of trust activity expand, as new adaptations of traditional trust services are adopted, as banks themselves similarly adapt to the emerging developments and financial needs of our nation, it is inevitable that there will result the need to apply established fiduciary and regulatory principles in new contexts. You, as bankers, have been doing that, as have we regulators. One example is our increased awareness of the problems inherent in the selection of brokers; another is the need to insulate trust investment decisions from non-public information possessed by the commercial side. Banks have established policies and procedures to deal with those matters, and we have made them a subject of scrutiny in examinations. We are now considering the adoption of amendments to Regulation 9 and to our instructions to examiners which will further strengthen our inquiry here, and perhaps add some clarity to the legal framework in the process. Those amendments would deny trust department investment decision-makers access to commercial credit files. Also, the changes would articulate the necessity that trust department investment decisions cannot be based upon non-public information obtained, even by accident, from any source. Examiners would make specific checks to verify that those limitations are observed. However, it is now apparent that we are in an era when the adaptation of preexisting regulatory principles and procedures is not sufficient. New principles and procedures are required in some areas. That, I think, results primarily from the fact that there have occurred some striking changes in the character of the American public. They no longer accept things on faith, but demand to be informed— to make their own judgments. And, as much as possible, it is necessary, therefore, that they be informed as to the operation of bank trust departments, and the extent of the relationships with the bank's commercial customers. Disclosure of the stock holdings—indeed, of all the assets held—in trust departments is essential to enable banks to continue to hold the confidence of the public. Knowing what assets an institution possesses and what it has done with those assets by way of purchases and sales may well counter much of the criticism that has been made of bank trust departments. Few actual abuses of the bank-trust department relationship have occurred; most of the criticism is based upon supposition, upon conjecture—in a word, upon ignorance. Dispelling that ignorance, even if it doesn't end the criticism, may make it more constructive and lessen the opportunities for other interests to play upon it for their own selfish objectives. I note that Jay Hambleton and I are in agreement here. With those ends in mind, this Office is considering the issuance of regulations requiring National banks to disclose their asset holdings, and their transactions in securities to this Office and to the public. I hope that we may be able to publish those proposals for comment in the near future. We would hope to be able to develop regulations which would apply to all National banks of a significant size—say with trust assets of over $100 million; and all transactions over a certain aggregate amount—possibly $500,000 which have occurred in a quarter would be disclosed. We shall also seek a uniformity of regulation among the three banking agencies. They now have a uniform annual report. The proposed reports could be adopted in lieu of the present reports for banks above the requisite size, for example. According to our figures, if the $100 million cutoff is used, it would affect some 200 National banks and 100 State banks. I am satisfied that we have the statutory authority to require reports of that nature. I would hope that any legislation which might be considered in that area would be drafted so as not to restrict the flexibility of present authority; it is very important that we be in a position to respond to changing circumstances. It may be that there is no need for a statutory requirement. Possibly the appropriate regulatory agencies, including the SEC, might cause the institutions under their jurisdiction in this matter to report the information necessary for each agency to carry out its functions, and make that information available to each other, and to the public. Thus, I hope the SEC, and all other affected regulatory bodies, will view the proposal with favor. We will work with them to meet any problems they might have with our proposals. Knowing the character and ability of the Commissioners and the staff of the SEC as I do, I am optimistic that we can achieve a mutually satisfactory result to the benefit of all concerned, including the public. There are other areas of reform which we must recognize. It comes as no surprise to trustmen that the bottom line of most trust operations appears in red. Fee schedules often appear designed only to cover expenses, and even then liberal exceptions are made when a community need or a commercial customer is to be served—particularly the latter. Neither is it surprising, as has been recently reported, that some bank critics have concluded that, because bank fiduciary operations are not profitable, corners have been cut in the services provided in order to effect economies. I feel that banks have left themselves open to that criticism. That, I understand, is one basis of the reported conclusion of Ralph Nader's Center for Corporate Responsibility in its study of the trust operation of First National City Bank, that banks, in general, do not provide individual service, as they claim, but use the assembly line approach. No sophisticated trustman would deny that uniform agreements are promoted and collective investment funds are utilized in our banks. However, the use of those tools is easily defended, and cannot fairly be characterized as "assembly line." Economies of scale may be a more descriptive and more realistic definition. Not only have most trust departments been unprofitable in the past, but management in a number of banks seems to be content to let them remain so in the future. The sinister conclusion might be drawn that banks are willing to operate an apparently unprofitable trust department because their greatest rewards exist in undisclosed form. What were acceptable practices in the past may be viewed with the suspicion that they are lurking evils. Indeed, the very fact that banks hold a vast amount of stocks of certain corporations is being questioned this very day before a subcommittee of the United States Senate. In previous hearings before this same subcommittee, it was suggested that banks were wrecking the stock market and might even be guilty of manipulation of the market—the reward there being the concentration of economic power that banks control through their trust departments. Others have pointed an accusing finger at banks for abuses in the authorized practice of maintaining uninvested trust cash balances in the bank's commercial department. The claim is made that these balances are excessive, resulting in unjustified profits for the bank. That claim is given more creditability, in the eyes of the public, by statements of trust officers that their department would only be profitable if credit is given for trust balances. Checking for excessive trust cash balances has been given high priority by our trust examiners for many years. It has been our experience that there are very few abuses in that area in National banks. In recent years, trust balances have been significantly reduced through the use of short-term collective investment funds and variable amount notes which provide for investment of cash for periods as short as one day. But the questions will continue to arise as long as trust departments are not profitable on the basis of fee income. The continuation of an unprofitable trust department is subject to even more legitimate criticism, I believe. Probably most damning is the attitude toward the department that this naturally tends to 255 create on the part of a bank's management. New resources, both human and material, may appear better allocated to the profit centers. The result will be a decline in the efficiency of the department and of the quality of its product, which only tends to heighten its unprofitability. The personnel of the trust department may be less apt to be promoted within the bank—their motivation suffers, and once again the quality of their product. If necessary to provide a reasonable margin of profit, banks should give serious consideration to revising their fee schedules to reflect the true value of the services which they are providing. Furthermore, the established fee schedule should be followed even if the prospective customer has a substantial commercial relationship with the bank. I suggest that if the separate identities of commercial and trust departments are not observed by bank managements in the pricing of their products, they are permitting a group of potentially damaging conflicts of interest to continue—conflicts which we may no longer be able to tolerate. This may be viewed as an extension of the Chinese Wall; I feel it is necessary if banks' managements are to make a serious commitment to their continuation of the trust business. Just as we tend to blunt the instrument with which we write, so also can we dull and blur the true meanings of our most familiar words with constant repetition. Reflect, if you will, on what the words "fiduciary" and "trust" really mean. If "duty" is the most sublime word in the English language—and many have lived and died in that belief—then the assumption of a fiduciary duty must be the highest calling to which a conscientious banker can respond. If "trust" is that degree of earned respect and confidence without which no bank can adequately serve its customers, then no effort should be spared to keep it inviolate. If periodic disclosure of aggregate holdings and transactions made in bank trust departments can strengthen public confidence in the soundness of a system working for the general good, we should welcome it. I have full confidence in the high ethical standards that characterize bank trust activities. Given a fuller understanding, I am sure that the public will share that confidence. I count on the banking industry for full cooperation to that end. TESTIMONY BY JAMES E. SMITH, COMPTROLLER OF THE CURRENCY, BEFORE THE SUBCOMMITTEE ON SECURITIES OF THE SENATE COMMITTEE ON 256 BANKING, HOUSING, AND URBAN WASHINGTON, D.C., MAY 8, 1974 AFFAIRS, Mr. Chairman and members of the Subcommittee, I appreciate the opportunity to appear before you today to support S. 1933, which would permit National banks to underwrite and deal in revenue bonds. I am the latest in a line of Comptrollers of the Currency who have come to the Congress to urge that National banks be at last permitted to serve the public interest by underwriting and dealing in nongeneral obligation securities issued by State and local governments. My distinguished predecessors, in testimony before committees of previous Congresses, have perceived and articulated the tremendous public needs of State and local governments, and the unutilized resources of National banks which could be employed in meeting these needs. In 1965, then Comptroller Saxon told the House Banking Committee: "We must help our cities develop the transportation, housing and other facilities which they need." Now, 9 years later, the urban and State problems are even greater, and National banks are still hobbled by archaic underwriting and dealing restrictions. Now is the time for Congress to show the American public that those problems are being addressed in Washington. S. 1933 is an excellent vehicle for action in this area. It would amend the National Banking Act to permit National banks to underwrite and deal in all types of revenue bonds, except special assessment obligations and industrial revenue bonds, while imposing certain conditions to assure prudence. Briefly, those limitations would require that: 1. Banks underwrite and deal only in those revenue bonds which are eligible for purchase by National banks; 2. Bank investment in revenue bonds of any one obligor in all of its accounts be limited to 10 percent of the bank's capital and surplus; 3. A bank acting as an underwriter or dealer not sell revenue bonds to any of its trust accounts unless lawfully directed by court order; 4. No member of an underwriting syndicate sell bonds to the trust department of any other bank which is a member of the syndicate until the syndicate has closed; 5. Sales of revenue bonds by a bank to its depositors, borrowers or correspondent banks be accompanied by a statement disclosing the fact that the bank is acting as an underwriter or dealer; and 6. Banks not transfer revenue bonds which they purchased as an underwriter to their investment account during the underwriting period, with certain exceptions. In addition, the bill would require the Secretary of the Treasury to submit an annual report to the Congress showing the extent to which the business of underwriting and dealing in State and local obligations is being carried on by commercial banks as compared with other institutions in order to determine the effect of the enabling amendment on the institutional distribution of this business. Revenue bonds have for many years been important in financing vital public projects. They gain public support by making those who benefit from a specific project pay for it. Also, communities faced with a statutory debt limit may find revenue bonds the only means of raising the money to provide needed facilities and services. It is highly significant that from a negligible amount of revenue bonds issued during the 1930's, the amount of revenue bonds issued in 1973 was $10,632,000,000, 44.5 percent of all municipal bond sales for that year. While popular, revenue bonds have suffered the disadvantage of not being eligible for underwriting by commercial banks. Studies have shown that the average number of bids for revenue bonds has been below those for general obligation bonds. Consequently, net interest costs on revenue issues has been greater than that on general obligations. The end result has been that the taxpayer paid more than he should have. Our studies show that significant interest savings would accrue to the public if, in accordance with our free enterprise philosophy and practical business experience, commercial banks were allowed to compete in the revenue bond underwriting field. In brief, I believe that National banks should serve the public interest and, whenever possible, use their resources to respond to public needs. If S. 1933 is enacted, commercial bank entry will increase competition in the bidding for, and distribution of, revenue bonds. That will broaden and strengthen the market for revenue bonds by improving their marketability and character as liquid investments suitable for bank portfolios and fiduciaries generally. State and local governments should be able to make needed public improvements more readily, and at a smaller cost to the taxpayer. Despite those obvious advantages, those who have a privileged competitive position under the status quo oppose S. 1933. Let me examine briefly their arguments. The first argument relates to the Congressional policy of separating commercial banking from investment banking. While Congress did act in the extraordinary circumstances of the early 1930's to make such a separation in the Glass-Steagall Act, it reaffirmed the earlier authority in the McFadden Act of 1927 to permit National banks to underwrite general obligations of States and their subdivisions. Throughout the Depression and until the present time, that authority has remained as a recognition that debt obligations of State and local governments have a special status. In 1968, Congress even broadened the authority to include revenue bonds issued by State and local governments for housing, university, or dormitory purposes. The extension of underwriting and dealing authority to all revenue bonds would simply be a logical and belated acknowledgement that modern financing techniques of State and local governments fall into the same category of special and privileged securities as more traditional methods. In this connection, Congress has frequently recognized the desirability of permitting commercial banks to underwrite and deal in securities which it authorizes and considers socially worthy. Examples are obligations of the Federal National Mortgage Association, the Government National Mortgage Association, and even the Inter-American Development Bank and the Asian Development Bank. The public needs of our own citizens should certainly be accorded at least as favorable a Congressional preference. Another argument against S. 1933 is that the underwriting of revenue bonds entails too much risk for commercial banks. The conditions in the bill which I have previously discussed make clear to me that the financial condition of National banks will not be adversely affected by the granting of this authority. Specifically, a bank would be limited to holding at one time in all its accounts the securities of any one issuer only in an amount up to 10 percent of the bank's capital and surplus. In addition, the bank could only underwrite and deal in securities of at least as high quality as those which it is now permitted to hold in its investment portfolio. It is interesting to note that the default record for revenue bonds and the ratings they receive from bond rating services compare very favorably with general obligation bonds. In fact, some general obligation bonds are definitely riskier than many revenue bonds. I think it is time to change the situation in which National banks may underwrite the less desirable general obligation bonds while being prohibited from underwriting the better revenue bonds. Another argument against the authority concerns possible conflicts of interest. There are those who raise the sinister specter of bankers selling undesir257 able revenue bonds they have underwritten to unsuspecting depositors and correspondents or putting them in trust accounts. S. 1933 provides, by its conditions, safeguards against such abuses. Under the bill, a bank acting as an underwriter or dealer may not sell revenue bonds to any of its trust accounts unless lawfully directed by court order. No member of an underwriting syndicate may sell bonds to the trust department of another bank which is a member of the syndicate until the syndicate has closed. Furthermore, sales of revenue bonds by a bank to its depositors, borrowers or correspondent banks must be accompanied by a statement disclosing the fact that the bank is acting as an underwriter or dealer. Thus, the customers are on notice and can take appropriate action to protect their interests. It is unrealistic to say that a bank would jeopardize its customer relations in order to sell bonds. After all, this is but a small portion of a bank's business. A more likely result is that increased knowledge concerning the revenue bond issue would permit banks to give more accurate and useful investment advice. At any rate, a bank would not keep a correspondent very long by palming off inferior securities on it. Finally, the experience of my Office in regard to National banks that underwrite other government obligations is that conflict of interest does not seem to be a problem. I do not think the underwriting of revenue bonds will create a sudden dilemma in this respect. The Senate has previously recognized the wisdom of permitting commercial banks to underwrite and deal in revenue bonds. In 1967, a bill similar to S. 1933 was passed by the Senate. At that time, the Senate Banking Committee considered in detail the benefits to local governments which would result from bank competition in revenue bond underwriting. I think it would be appropriate to quote the wellconsidered conclusions of the Committee: In addition to a higher incidence of negotiated sales, revenue bonds also enjoy fewer bids, even when they are issued through competitive bidding. . . . The number of bidders is extremely important to a hard-pressed municipality since the figures show the interest paid is inversely related to the number of bidders. In other words, the greater the number of bidders the lower the rate of interest which the city will have to pay on its bonds. (S. Rept. No. 713, 90th Cong.) S. 1933 is good for the American people, good for 258 the local governments and good for the National banks. I hope that I will be the last Comptroller of the Currency to come to the Congress to urge passage of a revenue bond underwriting bill. TESTIMONY BY JAMES E. SMITH, COMPTROLLER OF THE CURRENCY, BEFORE THE SUBCOMMITTEE ON SECURITIES OF THE SENATE COMMITTEE ON BANKING, HOUSING, AND URBAN AFFAIRS, WASHINGTON, D.C., MAY 8, 1974 S. 2474 is designed to establish a system of Federal supervision of parties trading in the municipal securities market. That market has, in the main, performed its debt financing function for State and local governments and other public agencies over the years with commendable efficiency and integrity. That has occurred in a setting largely free from Federal supervision, although the anti-fraud provisions of the securities laws have been applicable. However, there have been a number of isolated cases of abuses in recent years which we believe may justify consideration of adoption of some degree of Federal regulation and enforcement supervision of certain aspects of the municipal securities business. This Office has been working with the Securities and Exchange Commission in an attempt to arrive at a legislative approach which both our agencies would be able to support. Although we have not at this point reached such an agreement, I am optimistic that it is still within the bounds of possibility that we do so. For that reason, I shall confine my testimony to a few general observations covering the subject of S. 2474. We do not believe that the evidence at hand respecting abusive practices supports such a sweeping and undefined regulatory power as S. 2474 would establish. It should be noted that nearly all of the abuses of which we are aware have been subject to the SEC anti-fraud powers. We believe that the historic concept of this nation, of a government of limited powers, imposes a heavy obligation on those of us in the regulatory agencies to spell out with reasonable clarity the business practices or activities which justifiably should be regulated to protect legitimate public interests. The carte blanche delegation of regulatory powers which S. 2474 would entail seems to us contrary to the fundamental philosophies of our government and in excess of what the situation requires. S. 2474 contemplates the creation of another selfregulatory agency with rule-making and enforcement powers, similar to the National Association of Securities Dealers. For the reasons I have just stated, we do not believe that the establishment of another such self-regulatory body is warranted. While the establishment of a rule-making board composed of segments of the municipal securities industry plus representatives of the public interest may be of benefit, existing enforcement mechanisms contain the potential to carry out the rules and policies which legislation in this area would provide for. The NASD and/or the SEC could perform that enforcement function for non-bank dealers. The banking agencies are ready, willing, and able to perform a similar function for bank municipal bond dealers. Such a solution was wisely adopted by the Committee on the regulation of stock transfer agencies and depositories in S. 2058, which passed the Senate. That is a more desirable solution on enforcement, we believe, because it makes allowance for the preservation of bank soundness while still accomplishing the purposes of the bill. In addition, utilization of those existing enforcement mechanisms will avoid the increased expense and bureaucracy which the creation of a full-blown self-regulatory body would entail. After all, it is the result which is important. Rather than a simplistic identicalness of enforcement mechanisms which makes no allowance for bank solvency, we believe that investor protection can best be achieved through a coordinated enforcement endeavor, with the banking agencies expressly having the first opportunity to correct an abuse, and the SEC having a residual authority which it should exercise only after consultation with the appropriate banking agency. In addition, it would appear that the banking agencies should have the right to request that the Commission take action against a nonbank municipal securities dealer. The enforcement provisions of legislation in this field should make those principles explicit. At the same time, they should make clear that the banking agencies can use their present powers, including Section 8 of the Federal Deposit Insurance Act, to enforce the requirements of the legislation, and any rules promulgated thereunder. Similar comments might be made with respect to inspections of bank municipal securities dealers. Inspections for information purposes, such as S. 2058 contemplates, should be differentiated from those for enforcement. As to the former, we recommend that authority be made subject to similar constraints as S. 2058 contains, basically that the Commission coordinate its inspections with the examinations of the appropriate banking agency. As to the latter, the same safeguards as we have recommended for enforcement actions should apply. We also believe that the principles of limited gov ernmental interference with legitimate business practices which we mentioned a moment ago dictate that the powers of any agency which is given the authority to issue rules and regulations governing municipal securities dealers should be carefully circumscribed and defined. It would appear desirable that it be required that all government agencies involved in the regulatory process be consulted at some stage in the establishment of such rules. We have included in an appendix to this statement a list of the powers which we believe should be the limit of authority given the rule-makers under this legislation. Those subjects are reasonably related, we believe, to the undesirable practices which have been observed in the industry. We believe it far better for the agencies involved to return to Congress for additional powers if experience develops that those given are insufficient. We have no doubt that this body would respond promptly and responsibly to such a request. We also have a number of suggestions on technical points. Those points are also contained in the appendix to this statement. APPENDIX List of Subjects of Authority for Rulemakers 1. 2. 3. 4. 5. 6. 7. 8. 9. Fraudulent, manipulative or deceptive practices Suitability Markups Excessive transactions Trading by members of syndicates Authorization and acceptance of accounts Approval and review of transactions Voluntary arbitration procedures Accounts, correspondence, memoranda, papers, books, records and other data which must be maintained. 10. Procedures for periodic inspections Section 2(23). Section 2(25). Add "subsidiary" before "department" wherever it appears. This is consistent with the treatment accorded bank operating subsidiaries in S. 2058 and recognizes that such entities are subject to many of the same considerations as apply to parent banks. Section 2(24). Preserve "actively." Delete "including any employee of such dealer. The Commission may by rules and regulations classify, for the purposes of any portion of this title, persons, including employees, controlled by a municipal securities dealer." 259 The requirement that a person within this definition must be "actively engaged" in dealer activities is desirable—any broadening of this group to persons "directly or indirectly" engaged in these activities is too broad, especially when viewed in the context of a large bank affiliated with a bank holding company. It would impose unnecessary burdens upon persons and entities whose functions are largely unrelated to a bank's conduct of municipal bond dealer operations. Section 7. Revise to read: "The Commission and the bank regulatory agencies shall include in their annual reports to Congress a summary of their regulatory activities with respect to municipal securities dealers." We see no reason for singling out banks for special treatment, and believe that such reports regarding banks could best be made by the appropriate banking agency. It is possible that such reports could be potentially damaging to existing banks; the banking agency could best apprise Congress of the sensitivity of such information and in appropriate cases make recommendations for its safeguarding. STATEMENT OF JAMES E. SMITH, COMPTROLLER OF THE CURRENCY, BEFORE THE SUBCOMMITTEE ON BUDGETING, MANAGEMENT, AND EXPENDITURES AND THE SUBCOMMITTEE ON INTERGOVERNMENTAL RELATIONS OF THE SENATE COMMITTEE ON GOVERNMENT OPERATIONS, WASHINGTON, D.C., JUNE 27, 1974 "Disclosure of Corporate Ownership" We appreciate having the opportunity to testify here today. The area of your inquiry is a very vital one; one in which our Office has for years been concerned. It has been a matter of some surprise to us in the past few years to observe that much of the public discussion of bank trust departments and their supervision has not taken cognizance of the role of the bank regulators in this area, both present and potential. So it is that we welcome this invitation here this morning, hopefully, to add some perspective to this subject. Some background of the activities of the Office of the Comptroller of the Currency might be useful. This Office has the primary regulatory authority over the National banks of this country. However, until 1962, that authority was shared with the Federal Reserve Board with respect to the trust departments of National banks. National banks had to obtain the approval of the Federal Reserve before they could establish such a department, and to con260 form to the Federal Reserve's rules, then Regulation F, in the operation of that department. At the same time, they were examined and otherwise supervised by this Office. In 1962, Congress corrected that anomaly and transferred the licensing and regulation-making authority over National bank trust departments to this Office. In the same act, the regulation-making authority over common trust funds of all banks and pooled pension and profit sharing trusts of National banks was also placed in the Comptroller. The trust departments of all National banks have been regularly examined by this Office since the mid-1930's. In addition to the examinations which we conduct at least three times each 2 years of the National banks' commercial operations, a specialized examination is conducted annually of their trust departments. Those examinations are performed by trust specialists. Neither the examinations of the banks nor of the trust departments are rigidly compartmentalized, so that examiners of either function may and do obtain the necessary information through reference to the records found in either section of the bank. In the course of their examination of a bank's trust department, our representatives scrutinize very carefully the investments of the trust portfolios. They look for conflicts of interest, self dealing, or other violations of the law of trusts, as well as applicable State and Federal laws. In the performance of that examination they, as a matter of course, ascertain which securities are owned by each account and who the beneficial owners of those securities are. The fact that the trustee bank holds entrusted securities in the name of a nominee does not conceal the beneficial ownership of each trust asset. Violations of law, regulation or sound fiduciary principles discovered by the examiner are criticized in the report of examination. Such criticisms are followed up by this Office until satisfactory correction is made. In addition, all trust holdings of stock of the trustee bank and affiliated companies are reported to this Office in the report of examination. Thus, over the years there has been no lack of knowledge on the part of this Office as to what was held by National bank trust departments, or identity of the beneficiaries of each account being administered. What I have discussed thus far indicates that the report of examination deals with specific criticisms and with trust holdings of securities of the bank and its affiliates. Where additional information has been needed, it has been obtained by requiring the filing of other reports. Thus, National banks have, since the 1930's, been required to file annual reports with this Office, setting forth the amounts of trust department assets held by category—stocks, bonds, real estate, etc. In 1963, this Office amended that system of reports to require market value figures, rather than the often inaccurate book values which had prevailed theretofore. The other banking agencies followed our lead in this revision a couple of years later, and it was this method of reporting which was adopted by Chairman Patman's Subcommittee in its report on commercial banks and their trust activities, published in 1968. Since 1963, this Office has also required all banks operating common trust funds and National banks operating pooled trusts for the collective investment of pension and profit sharing funds to file their annual reports for such funds with us, and to make them available upon request to anyone. Previously, under the regulations of the Federal Reserve Board, banks were prohibited from disseminating information regarding common trust funds. The 1963 amendments of this Office required the disclosure by National banks of the assets held in all collective funds. As you know, those funds are used by banks collectively to invest the assets of separate trusts. As such, the funds represent the largest asset pools within banks and, thus, are the most relevant sources of information for one who is interested in ascertaining what the investment policies and holdings of given banks may be. At the same time the reports do not reflect the individual accounts which are invested in the collective funds or their beneficiaries, thus their disclosure does not interfere with the confidentiality of individual holdings. In an effort to provide further information on bank fund holdings, this Office, in 1965, initiated an annual questionnaire to all banks operating common trust funds. That questionnaire elicits information as to common fund holdings as of a given date, thus furnishing a basis of comparison for such holdings. Those data have been assembled annually in tabular form and made available to the public by this Office, occasionally accompanied by analyses of their investment composition and performance as against other types of funds, prepared by members of our Department of Economics. In April of this year, this Office published for comment proposed regulations requiring National banks to make disclosures of trust department holdings of individual securities. Under those proposals, National banks having trust assets of $100 million or more would be required to file this additional report with this Office. Holdings in excess of 10,000 shares of any one company will be reported. This report would require disclosure of the degree of investment responsibility and voting power over the shares held. In addition, the proposed rules would require National banks tofilereports quarterly on all transactions which have occurred during that period which are in excess of 10,000 shares of $500,000 in value. That additional reporting system, we believe, is desirable in view of the increased awareness and interest of the public in this subject. As I stated in announcing those proposals in February of this year: They no longer accept things on faith, but demand to be informed—to make their own judgments. And, as much as possible, it is necessary, therefore, that they be informed as to the operation of bank trust departments, and the extent of the relationships with the bank's commercial customers. Disclosure of the stock holdings—indeed, of all the assets held—in trust departments is essential to enable banks to continue to hold the confidence of the public. Knowing what assets an institution possesses and what it has done with those assets by way of purchases and sales may well counter much of the criticism that has been made of bank trust departments. Few actual abuses of the banktrust department relationship have occurred; most of the criticism is based upon supposition, upon conjecture—in a word, upon ignorance. Dispelling that ignorance, even if it doesn't end the criticism, may make it more constructive and lessen the opportunities for other interests to play upon it for their own selfish objectives. It is our understanding that the other banking agencies are preparing similar reporting requirements. At present, 224 National banks would be covered by the proposal. If the Federal Reserve were to adopt a similar requirement, 80 State member banks would be affected. If the FDIC were to do likewise, another 39 State banks would be subject to the rules. Our Office plans to make the information contained in the reports available to other government agencies, and the public. The period for comment on the proposed rules has just expired, and we are in the process of analyzing the comments we have received. We hope to be able to make the regulations final in the near future and to receive the first annual report of holdings as of December 31, 1974, along with the initial quarterly report of transactions, covering the last quarter of this year. We believe that between the requirements of disclosure which we are going to impose, and the supervision of trust departments which we are per261 forming through the examination function, the necessary protection to the public can be achieved with the minimum interference with business, while similarly keeping the expansion of the federal bureaucracy under restraint. Our philosophy throughout the period which I have just reviewed, has been one of requiring increased disclosure by bank trust departments. We have endeavored to provide the maximum of meaningful disclosure while imposing a minimum of burdensome reporting requirements, and also avoiding any unwarranted governmental intrusion into the privacy of individual estates. We have not, and we do not intend, to require public disclosure of the holdings of individual accounts, or of the persons holding beneficial interests in them. Frankly, we can see no justification for proceeding so far into the private financial affairs of individuals. Adequate authority exists for the respective agencies of government to obtain such information where it is relevant for legitimate government purposes. TESTIMONY BY JAMES E. SMITH, COMPTROLLER OF THE CURRENCY, BEFORE THE SUBCOMMITTEE ON FINANCIAL INSTITUTIONS OF THE SENATE COMMITTEE ON BANKING, HOUSING, AND URBAN AFFAIRS, WASHINGTON, D.C., JULY 31, 1974 It is a pleasure to appear today in support of S. 3817, a bill to amend the National Bank Act and certain other acts to permit federally insured financial institutions to charge 5 percent above the Federal Reserve discount rate on loans to corporate borrowers. As the regulator of National banks, our Office is well aware of the reasons for this bill. In a number of states, usury laws limiting the amount of interest that National banks may charge on loans apply to corporate loans as well as to personal, consumer loans. In Tennessee, Arkansas, and Montana, for example, the maximum loan contract rate for corporations is 10 percent, a figure below the prime rate and the Federal funds rate. The inevitable result of that condition is the lack of funds available for the normal and productive conduct of the banking business as it relates to the corporate sector. Let me give you some examples. A National bank in Tennessee has had a restrictive policy on loans for the past 4 months. Its senior loan officer has told us that $22 million of creditworthy loans had to be refused. Although the stringent money market conditions have been partially responsible, the rate limit factor has been present in every case. The bank estimates that around 50 percent of those loan applications would have been 262 approved if the bank had the ability to price the loan terms competitively. Examining the situation on a case-by-case basis, another National bank in Tennessee had to turn down an otherwise creditworthy loan of about $1 million to a new company in the furniture manufacturing field. That new operation would have added new jobs to the Tennessee economy but has not been able to commence operations because of the lending restrictions in Tennessee. The same bank had another application for a $400,000 loan from a coal company for the purchase of coal mining equipment. Despite the offer of personal endorsements on the loan and good equipment collateral, the loan was turned down because of the credit restrictions in Tennessee. Certainly that loss to the energy resources of the country is a very undesirable consequence of the special problems National banks face in states which extend usury laws to corporate borrowers. In addition to those instances I have seen copies of letters from businessmen in the affected states that reflect their deep concern about the restriction of available funds. A food company executive says: "Our business is hurt by this restriction." A small businessman cites the possibility that his company might "run short in relation to current payables, payroll, capital expenditures and expansion." Yet another letter, this one from a shopping center development company executive, states: Because of the 10 percent usury law, we are being slowed up and find it very difficult to continue to develop in our State. Most of the other areas we are operating in are not handicapped by this law. In the vital area of health products, officials of a company supplying drug prescription products states: "Our ability to meet these needs is being seriously impaired due to the critical shortage of corporate money in Tennessee." Of course, those examples illustrate the more fundamental question of usury laws and their social utility. Usury laws have always been presented by their proponents as offering protection against unreasonably high or unfair rates of interest. As long as the legal rate ceiling is above the going market rates, it is obvious that the law has no effect. During those periods the existence of usury statutes is widely ignored. When the level of interest rates moves upward, and the going market rates for particular types of loans would, in the absence of restrictions, exceed the legal maximum, the funds funnelled by lending institutions to those types of loans dwindles over time and eventually disappears. While banks certainly attempt to meet the needs of their long-time customers, they are not charitable institutions. Therefore, they cannot indefinitely channel funds to uses yielding rates of return well below rates available on alternative uses or at rates below the bank's marginal cost for funds. It is cold comfort to a prospective borrower to be aware that he is "protected" from "usurious" rates of interest when no funds are available to him at the legal rates. While the most desirable solution to this problem would be remedial action at the State level, we must confront the reality that in some affected states there is scant chance of such action, at least in the near term. In a State such as Tennessee, where the rate limit is a constitutional provision, the elaborate machinery simply cannot be cranked up in time to solve the very immediate dilemma. That, of course, mandates Federal attention to an economic problem which is regional in scope and National in effect. There is adequate precedent for Federal action in this area. In 1933, the National Bank Act (12 U.S.C. 85) was amended to permit National banks to charge 1 percent above the discount rate on 90-day commercial paper in effect at the local Federal Reserve Bank. Senator Glass, who introduced the amendment, perceived that when such a rate exceeded the State interest rate ceilings, National banks had to be the instrumentalities to permit businesses to borrow money, or face possible collapse. Although the Federal Reserve discount rate no longer reflects market rates and the 5 percent above discount rate provision is a necessary amendment, I think that precedent has some value in itself. It has been suggested that the Congress select an index, such as the 90-day Treasury bill rate, that would be more responsive to market conditions. As the need is for immediate remedial action, the most effective procedure would be a modification of the existing law, referring to the discount rate, in the manner of the bill introduced by Senator Brock. In this connection, the 5 percent leeway will give a sufficient margin of return to reopen the channels of credit to many deserving corporate borrowers in states such as Arkansas, Montana, and Tennessee. I am pleased to note that S. 3817 extends the coverage of the proposed amendment to all federally insured banks and savings and loan associations. This is in line with a recommendation transmitted to Senator Brock by our Office. National banks in those states need the additional authority granted in S. 3817 in order to serve adequately the financial needs of businesses, on which payrolls and economic development depend. Swift passage of the bill would be a service to the public in those states. TESTIMONY BY JAMES E. SMITH, COMPTROLLER OF THE CURRENCY, BEFORE THE SUBCOMMITTEE ON SECURITIES OF THE SENATE COMMITTEE ON BANKING, HOUSING, AND URBAN AFFAIRS, WASHINGTON, D.C., AUG. 13, 1974 We are pleased to testify here this morning on S. 2234 and S. 2683. While they have individual variations, they also have in common certain features upon which my comments today will primarily focus. These bills would establish a comprehensive system of disclosure of securities held by institutional investors. Also required would be the reporting of securities transactions by those investors. These reports would be filed with the Securities and Exchange Commission. We believe that the objectives sought to be accomplished by the bills have desirable aspects. The need for public disclosure of what is held by institutions, and what they are doing with those holdings, has been shown. The Comptroller's Office has recognized this by imposing additional disclosure requirements upon National bank trust departments which by the end of the year will be providing much of the information called for by these bills. Both bills, however, would impose disclosure requirements which go beyond what appears to be justifiable for regulatory objectives. In the process they would impose unjustified cost and administrative burdens upon banks. We do not believe reports of bank holdings of securities need be made more frequently than once a year. Neither do we believe that reports of debt securities are necessary. There would also be added cost to banks in providing such reports on a more frequent and comprehensive basis. If the purpose of the legislation is only to enable all agencies of government and the public to be informed of the power wielded by institutions, and the effect their securities transactions have on the market, that can be accomplished by requiring annual reports of equity holdings, and quarterly reports of transactions in those securities. The information which an annual report reveals, supplemented by information revealed in quarterly reports of transactions, will provide a reasonably accurate source of information on the potential influence which a single or any several institutions might have over particular companies or industries. Reports of 263 trading in debt securities are not very necessary or helpful to these purposes. On the other hand, if increased disclosure is also desired to enable persons to measure the performance of institutions, it is not accomplished by requiring banks to give quarterly reports of securities held in all types of accounts. The total securities holdings in a bank trust department will be a reflection of the varying restrictions which a myriad of governing instruments impose both on retention of assets received with various estates, and on the permissible range of investments to be made by the bank. That can be no basis for any intelligent or accurate measurement of performance. The best, perhaps the only, reliable basis for measuring bank performance is the thorough analysis of asset composition of bank collective investment fund portfolios. Current regulations already require the annual disclosure of the holdings of those funds, plus all transactions which have occurred in that period. Another possible index of performance would be the holdings of individual pension funds. That information would not be brought forth by the reports required by these bills. It is, of course, already available in the reports required under the Welfare and Pension Plans Disclosure Act, as amended. In any event, we believe that the foregoing shows that quarterly reporting of holdings of all securities held by banks cannot be justified by the performance data which those reports would yield. As indicated previously, the Office of the Comptroller has imposed on National banks a system of disclosure which is consistent with the foregoing principles. It requires what is needed for all legitimate needs, and no more. It can be effectuated within a reasonable period. Best of all, it is flexible. It can be readily amended to provide any additional disclosure which the Congress believes appropriate. It coincides with the existing bank supervisory framework, and will cover the bulk of the bank institutional investors. The information will be available to the SEC and all other agencies, as well as Congress and the public. Given this set of circumstances, we respectfully ask this Subcommittee to consider carefully whether legislation placing an across-the-board reporting requirement with the SEC is warranted. We suggest that consideration be given instead to the enactment of authority in the SEC to compel the production of reports from any institution which is not already providing reports which conform to certain set standards—which standards we hope would be along the lines of our present reporting system. We submit that that would satisfy the essential public concerns, 264 while at the same time avoiding an unnecessary expansion of the Federal bureaucracy through a duplication of regulatory efforts. REMARKS OF JAMES E. SMITH, COMPTROLLER OF THE CURRENCY, BEFORE THE ROBERT MORRIS ASSOCIATES FALL BUSINESS SESSION, ATLANTA, GA., NOV. 11, CONFERENCE 1974 Although the title of my address appears in your program as "Famous Banking Wrecks", it should be more discreetly and appropriately described as "The Advancing Art of Bank Regulation" or "Some Lessons from Recent Bank Failures". As a compromise I am entitling this speech "Address by James E. Smith". Actually, I am not here today simply to rehash some old war stories for the sake of their entertainment and dramatic value, to which it would take a Shakespeare to do full justice, but rather to extract the lessons from recent bank problems for instruction in desirable directions for regulation in the future. Some of those lessons have already found form in new regulations, and others are now being evaluated with better informational and analytical tools. These matters are of substantial import to our industry, and it is appropriate that I bring them to the attention of those bank officials most directly affecting the safety and soundness of our banking system in their daily decisions—the men who determine the nature of the loan portfolios of our banks. Let me start out with a couple of lessons that we learned in the failure of United States National Bank of San Diego. This was a case, as you know, of a total corruption of sound and honest credit administration principles that ultimately brought about the bankruptcy of a major institution and economic injury to many innocent people, though thankfully to no depositors. Upon being sworn in as the 23rd Comptroller of the Currency in the summer of 1973, I immediately joined my new colleagues in the salvage effort being directed toward USNB, an effort which culminated in the failure and sale of that bank to Crocker National in October of the same year. Our post-mortem analysis certified that which we already knew; that USNB was the victim of what I have characterized on more than one occasion as "self-dealing lending run riot." The interrelationship between C. Arnholt Smith, USNB, Westgate California Corporation, British Columbia Investment Company, and other affiliated interests has been detailed previously in major news publications. Moreover, I believe that between Frank Wille and me, the USNB story has been recounted at least once during the past year to every individual even remotely connected with the banking industry. I will try to hold repetition to a minimum but, in order to give you some perspective on the scope of the self-dealing involved, let me throw out a few numbers. Our examination of USNB, completed in March 1973, showed credit extensions of about $340 million to affiliated interests of Arnholt Smith, roughly 38 percent of the loans of the bank. An additional $42 million had been indirectly channeled to associated companies through standby letters of credit. We were clearly not dealing with a small time operation. Within the realm of failed banks, self-dealing is not an uncommon causal factor. In fact, 11 of the 31 bank failures since 1968 may be primarily attributed to insider transactions and that same factor was significantly present in 16 others. The FDIC reports that 75 percent of the banks appearing on the "Serious-Problem-Potential Pay-out" list and 54 percent of those listed as "Serious Problems" involve excessive insider dealing. Almost a year ago I testified on the USNB receivership before the House Subcommittee on Bank Supervision and Insurance. At the conclusion of that testimony, I indicated that we had tentatively identified some potential problem areas which would be reviewed with the goal in mind of developing regulations to curtail future USNB-type abuses. The first regulatory response directly associated with USNB's impact came last August when the three Federal regulatory agencies adopted rules making the single borrower lending limit and the restrictions on lending to affiliates applicable to standby letters of credit. There is a statutory limit of 10 percent of capital funds allowed for the extensions of credit to any one borrower. The effect of the new regulation will be to require the aggregation of direct loans and standby letters of credit when extended for the benefit of the same borrower. The rationale of that rule is that under a standby letter of credit the bank is undertaking a legally enforceable commitment that resources will be available to support a particular borrower if funds are subsequently needed and the concept of concentration of risk is every bit as present in this device as it is in a straight loan. From the standpoint of administering the law aimed at preventing undue concentration of risk by a bank as to any one borrower, the greatly increased use of standby letters of credit in recent years has made it imperative that the loan limit be applied to those instruments. We will also now be in a better position under that regulation to prevent imprudent use of the standby facility, such as occurred in the United States National Bank case, for the benefit of the controlling interests. The other major regulatory development thus far to have been spun-out of the USNB case is the regulation we have proposed to require the identification of officer and director business interests so that bank examiners can properly review the appropriateness of extensions of credit to affiliated interests of those individuals. That was a major element in the USNB problem. Arnholt Smith was able through numerous business entities in which he had undisclosed interests to subvert bank loans to his own use, greatly in excess of the legal maximum to one party. The core of that problem was that the examiners had no records within the bank to turn to that would identify all of the various business interests of Smith so that they could properly police the loan limit. The new regulation, which I am publishing in final form this week with an effective date of January 31, 1975, will substantially reduce the likelihood of massive self-dealing occurring again in a National bank. The new regulation will provide that directors and principal officers of National banks will be required to keep on file at the bank, for review by our examiners, by the bank's board of directors, management, and appropriate lending officers, auditors, and attorneys, a statement identifying any business enterprise in which the reporting officer or director, his spouse, or his minor children have an interest, and any relationship such an enterprise might have with the bank. In order to assure completeness and truthfulness in answers, the statements filed are made subject to the penalty provisions of the Federal criminal statutes. With that comprehensive treatment of the business interests of bank officers and directors in hand, bank examiners will be able to identify all credit relationships of the bank to affiliated interests of those officials, and determine whether such relationships are within the statutory limits in amount and whether they are fair from the standpoint of the bank. One of the primary benefits of that regulation will be that, from the standpoint of a responsible bank president or credit officer, there will be a strong regulatory policy behind that regulation for him to rely upon in requiring that any extensions of credit to officers and directors and their affiliated interests must meet the toughest standards applicable to any non-affiliated customer. The bank's best interests, not those of the officer or director seeking the loan, will be the criterion in such loans. The types of business interests to be covered by 265 that regulation include the ownership of stock, or other legal or beneficial interest in a business enterprise, which amounts to 10 percent or more of the outstanding equity interests in the enterprise or any class of stock therein. Included also will be any indebtedness owed to another enterprise in the amount of $100,000 or more, and certain holdings of indebtedness of other enterprises. Additionally, all instances of an authority in a director or officer to direct the management or the policies of another enterprise, whether through the ownership of securities, by contract, by intercompany relationships, or otherwise, will be reported. Any positions in an enterprise, including those of employment, trusteeship, beneficiary, or partnership, will be reported. For the purposes of determining the "interests and positions" in an enterprise, a director or officer's immediate family's interests or positions will be included, the family being defined as his spouse and minor children. Our expectation is that the new regulation should prevent much of the abusive self-dealing practices in the relatively small portion of the National Banking System where they exist. The banking industry will do credit to itself in the eyes of the regulators, the Congress, and the banking public by affirmatively implementing both the letter and the spirit of the regulation. Out of our general experiences with troubled banks in recent years we are also moving in several other areas where problems for banks can appear. One of our recent efforts to strengthen regulatory oversight capabilities in the bank lending area includes a past-due loan report series. Soon all National banks will be submitting to us, on a regular basis, a summary of their past-due loans as a porportion of their total loans. We plan to require submission of those reports every 2 months, with the report date falling on the last business day of the cycle's second month. The first such date is the last business day of November, with submission due on December 10. Data on four loan categories, including real estate, commercial and industrial, personal, and "all other'^_are__rejjuired. We believe that the report will furnish our Office with a useful regulatory tool. Our Regional Administrators will receive a copy of those reports and thus will be able to follow loan delinquencies for each individual bank on a more frequent basis than our present examination cycle allows. We will subject the data to intensive computer analysis. The results will allow us to distinguish regional differences, sizeof-bank differences, and differences by type of loan. Over time we will be able to make valuable year-to266 year comparisons. We plan to return to every National bank a summary of the results so that the individual bank can comparatively place itself within the spectrum of banks of its own size and region, and generally structure its loan and past-due policies from a more informed position. I think that the ultimate result of this better information will be a lower proportion of past-due to total loans, which naturally improves the safety of the system, and will probably improve bank profitability as well. From the 200 largest National banks, we have also requested a new report, entitled the "Maturity Schedule of Assets and Liabilities", to be completed as of the last business day of October 1974 and due by November 15, and thereafter every three months. We have felt for some time that the "Bank Liquidity Analysis" (BLA) form, which every National bank has been submitting with the Report of Condition since December 1966, has imperfectly measured the liquidity of the larger National banks. Perhaps the principal weakness of the BLA form is that it does not measure access to market funds possessed by those banks. We give less credence to another criticism of it from bankers, that it does not take into account the liquidity entailed in a loan runoff. It is our observation that an ongoing bank that plans to be a continuing institution can not rely upon its ability to cut back the extension of loans, and that such new extensions typically match or more than match funds received in the runoff. Ideally, in any attempt to analyze the matching of maturities of assets and liabilities, one would want access to a maturity breakdown for all those assets and liabilities for which the maturity concept has meaning. In our discussions with the banking industry during the spring and summer, however, it became apparent that at this time we could not secure comprehensive maturity data on loan portfolios from even the larger National banks. Consequently, our initial Maturity Schedule does not require loan maturity data. I have urged the larger National banks, however, to pursue the task of computerizing loan records as rapidly as possible. We believe that for both our purposes and the purposes of bank management, such information is invaluable. We are aware of the argument that loan maturity data would tend to overstate liquidity, because there are often unwritten commitments to rollover C&I loans. We recognize the existence of such commitments. However, we also tend toward the view that the contractual terms of a loan agreement provide the best base from which to begin the process of estimating the effective maturities of loan portfolios, an element which will be important to a fully satisfactory data base. With the data we develop from the Maturity Schedule, we will be able to run analytical programs on individual banks and on the aggregate. We believe that can provide us with a comprehensive picture of the true liquidity situation of each bank and of the industry as a whole. Projections might be able to be made of what the impact on each bank might be of changes in certain major variable factors such as interest rates, aggregate deposits in the system, increases in loan demand, and so forth. Significant findings will be made available to the individual bank and/or to the industry as a whole, as may be appropriate. The end result of the Maturity Schedule project should be a much better informed banking system where banks can properly plan future actions with an understanding of what changes in their true liquidity situation may develop as a result. At some point it may be possible to carry this system on an individual bank basis to the smaller banks as well, although they will also benefit with the initial program in knowing more about the general liquidity situation in their industry. Another current endeavor of our Office relates to our examination treatment of loans to large national corporations in which two or more banks provide the loan proceeds. Our Office has arrived at the fairly logical conclusion that we cannot justify divergent treatment of the same loan among participating banks. To achieve uniform treatment calls for new procedures. We have taken steps to set up a procedure under which a team of senior examiners from various regions will go to the "lead" banks for all loans totaling $20 million or more in which two or more banks are participating. The examiner team will decide upon the appropriate classification of the national credit during the visit to the lead bank. That will continue to be the sole classification in all participating banks until the next examination of the credit in the lead banks. Additional reviews of such credits may be made on an unscheduled basis when there are significant developments that have affected, or would be likely to affect, the quality of the credit. Each of our Regional Administrators will receive a copy of the classifications of national credits and we also plan to furnish a copy to the Conference of State Bank Supervisors (CSBS). We have worked closely with the Conference and with the American Bankers Association in developing the nuts and bolts of this program. According to our latest information, it appears likely that CSBS will begin a similar program. If that is the case, CSBS will furnish us those classifications made for national credits in which State banks take the lead position. Not only will this program eliminate the obvious inequities of divergent classifications, but will also improve the efficiency of our examination procedure. We are instituting a similar program to secure uniform classification of foreign credits in our examination of the international operations of National banks. Despite our regulatory activities in the lending area, we all know that the real responsibility for maintaining high loan policy standards and, among other things, thwarting self-dealing, rests with individual banks. The fundamental element of a bank's efforts to assure quality in its loans is a written loan policy. Unfortunately not every bank has a good policy or, for that matter, any formal policy at all and even some who have good written loan policies do not observe them. From time to time, our Office gets inquiries on how to formulate or strengthen a loan policy and we generally recommend a nine point program which is not far different from that proposed in a number of banking publications. One point which we emphasize in our recommendations and one which becomes increasingly important in today's economy concerns loan review. The importance of periodic loan review and of increasing the frequency of that review when economic conditions dictate cannot be stressed too much. Our examination records show that many of today's criticized loans result from failure to establish a firm loan review procedure. We are seeing a good example of the importance of loan policy and loan review in the construction and the housing industries. The energy crisis, rising building material costs, high interest rates, and general inflationary pressures have caused some builders to default on their loans. While banks should continue to support the mortgage market to the maximum extent feasible, they also need to be wary of acting too casually in this area, particularly in the construction field. I am speaking specifically of so-called "front-end loans" or "front money loans". As you know, that type of loan is short-term, unsecured, and typically used to cover such preliminary building costs as architect fees, feasibility studies, or picking up land options. It is also the mechanism that provides the builder with the front money equity which is required by the financial institution providing the construction loan. Thus, the promoter of a construction project may reach the construction loan stage without involving any of his own funds. When the project 267 shows signs of weakness and either construction loan funds or sales funds do not show up, the frontend lender may be left with little or no prospect of repayment. The bank with a solid written loan policy that is enforced would probably be insistent on obtaining a better secured position with respect to such loans to begin with, and probably in a systematic loan review procedure would have identified the developing problem in that area in time to retrench such lending activities. But, as I said earlier, some banks do not apply a rigorous written loan policy or review procedure and are learning the costs of that lack of proper internal control the hard way. The lesson for all of us in the front-end loan experience is that the developing and maintaining of a firm written loan policy and loan review procedure is an essential factor in the maintenance of high quality assets in our system. This has been a brief review of some of the new regulations, new information systems, and improved concepts that we will be using in the future to help assure that banks maintain asset quality in the National Banking System. The primary motivation for high quality in our system, however, must come from bankers themselves. Regulators can only facilitate and encourage careful and reasoned credit extension, they cannot make the actual credit judgments for a bank. Our regulations can help focus proper attention on systems and procedures, but they cannot substitute for good judgment and good faith on the part of the Nation's bankers. My experience with bankers has shown me that these virtues are vastly predominant, and that this Nation can continue to rely upon the banking system to perform its essential economic functions in a sound, efficient, and fair manner. TESTIMONY BY JAMES E. SMITH, COMPTROLLER OF THE CURRENCY, BEFORE THE SUBCOMMITTEE ON BANK SUPERVISION AND INSURANCE OF THE HOUSE BANKING AND CURRENCY COMMITTEE, WASHINGTON, D.C., DEC. 11, 1974 "United States National Bank Insolvency" On October 18, 1973, I declared United States National Bank of San Diego, Calif., to be insolvent and appointed the Federal Deposit Insurance Corporation as receiver. In testimony before this Subcommittee on November 27, 1973, FDIC Chairman Wille and I recounted the events leading up to this action, and described the overnight transaction by which Crocker National Bank took over certain of 268 the assets and most of the liabilities of USNB, thus preventing any loss to depositors. I stated then that the Comptroller's Office still was studying the causes of the failure and the means of diminishing the chances of a recurrence of similar problems at another bank. In the course of that evaluation, my staff" and I reviewed the examination reports of USNB for the last 15 years. Additionally, two seasoned National bank examiners reviewed the loan slips relating to credits of C. Arnholt Smith, Westgate California Corporation, British Columbia Investment Company, Hollis Roberts, and any related companies or individuals which were prepared during the examinations of USNB commenced on August 11, 1969, April 15, 1970, December 11, 1970, and September 10, 1971. We investigated any suggested possibilities of malfeasance on the part of employees of the Comptroller's Office. On the basis of that review I offer to the Subcommittee the following comments and recommendations. First, there is no basis to conclude that there was malfeasance on the part of any person in the Comptroller's Office. There is no basis for newspaper speculation that examiners were bought off or that various reports prepared by examiners at USNB were stopped at the regional level. We reviewed the records of the bank looking for evidence of gifts or loans to our examiners. We made inquiries of each senior officer of USNB and interviewed at length the bank's vice president for public relations, Mr. Lipton. All information we developed was made available to the Department of Justice, which is conducting its own investigation. As a result of the investigations, we discovered that some Comptroller of the Currency employees received from the bank a baseball ticket to the San Diego Padres, a half-dozen cans of tuna fish at Christmas, a lunch or dinner, or a Magic Kingdom discount card to Disneyland. Mr. Lipton apparently was an insistent gift giver, and some of our employees may not have reacted to his insistence as well as they should have. I find no evidence, however, that any gift other than of nominal value was ever given, and no evidence that the judgment of any examiner ever was influenced. In short, there is no evidence that any employee of the Comptroller's Office was bought off. If anyone has such evidence, I wish he would make it available to me so that I may evaluate it and take remedial action and, if warranted, refer the facts to the Justice Department. Similarly, there is no evidence that reports were stopped at the regional office. Various newspaper stories have suggested that, somehow, our then Regional Administrator, Mr. A. E. Larsen, failed to call to the attention of the Washington Office serious problems reported to him about USNB. I know of no foundation for that charge. All important information concerning USNB promptly was sent to the Comptroller's Washington Office, particularly during the critical years of 1962, 1972, and 1973. Indeed, I should point out that the June 1973 complaint filed against Westgate California Corporation and Mr. C. Arnholt Smith by the Securities and Exchange Commission and the July 1974 indictment against Mr. Smith both are largely based on information originally supplied by the Comptroller's Office. Second, the self-dealing loans which led to the downfall of USNB were not unusual for that bank. It should be remembered in this connection that C. Arnholt Smith acquired control of this bank in the early 1930's, when its deposits were approximately $1.8 million. During his 40 years of leadership, the bank grew to the 86th largest bank in the United States with over $1 billion in deposits. The Comptroller's Office thus was dealing with a banker with a proven track record. Part of that track record included a continuing substantial volume of loans from the bank to Westgate California Corporation and other entities associated with Mr. Smith. Mr. Smith and his related companies also had substantial borrowing relationships with other banks. Our examination reports for 195&-1963 and 1968-1973 show a pattern of heavy loans to Westgate which frequently were criticized by the examiner as being in excess of the bank's legal lending limit under 12 U.S.C. 84. Whenever such a violation was found, USNB immediately cured it by selling some of the loans to other banks. A recurring problem also existed concerning inadequate credit files on some of these loans. The following chart, compiled from the Comptroller's examination reports, shows for each of the dates on which the bank was examined during the years 1958-1973, the deposits on those dates, the total loans, and the total loans involving Smith-related companies. Overline loans and incomplete credit files are frequently encountered by National bank examiners. Those problems usually are written up by the examiner, corrected by the bank, and not repeated. The unusual part of the picture at USNB was the recurring nature of the violations. In general, those recurring violations did not cause too much alarm because the Smith-related loans, both at USNB and at other banks, had not resulted in losses, and the companies which were using the funds seemed prosperous. Third, the Office did become alarmed about some of the problems discovered during an examination of TABLE A Date of Exam Jan. 1958 Dec. 1958 Apr. 1959 Dec. 1959 Sept. 1960 May 1961 Dec. 1961 Sept. 1962 Feb. 1963 Sept. 1963 Apr. 1964 Nov. 1964 June 1965 Feb. 1966 July 1967 Feb. 1968 Oct. 1968 Sept. 1969 Apr. 1970 Dec. 1970 Sept. 1971 June 1972 Jan. 1973 Deposits Total Loans 97.0 103.3 122.7 130.7 137.0 131.4 153.6 179.9 192.9 212.3 224.4 223.9 238.2 267.3 354.2 366.2 406.4 409.1 437.0 4S0.9 600.0 779.9 896.7 41.3 42.1 56.0 66.7 71.8 73.9 80.3 98.1 113.0 114.8 122.0 141.8 150.4 187.0 225.0 223.7 265.9 288.7 299.4 332.8 363.2 431.1 539.2 Total SmithRelated Loans 8.9 3.7 8.0 a b 13.0 13.5 20.0 17.0 c d d d d d d 60.0 55.5 57.1 74. lf 69.0f 254.0gg 340.0 a Not reported. $12 million in Smith-related loans participated bybUSNB to other banks. No numbers given. Examiner described USNB as having "usual quantity" of Smith-related loans. c Not reported. $11.1 million in loans to Westgate California Corporation and Southern Mortgage Company has been sold to other banks. Mr. Smith listed borrowings from other banks of $2dmillion. No mention of loans to Mr. Smith or any of his interests. e Not reported. Loans by USNB to Westgate California Corporation and related interests were $10.2 million. Mr. Smith listed borrowings of $7 million from other banks. f Excludes letters of credit. g Includes extension of credit to British Columbia Investment Company. Includes letters of credit. the bank begun on September 11, 1962. Loans whose creditworthiness was criticized by the examiner rose to $9.6 million, or 72 percent of the bank's capital. Of that $9.6 million, $3.2 million were in loans to Westgate California Corporation. Loans to Smithrelated interests totalled $20 million, or 152 percent of the bank's capital, and $13.6 million of those loans were found to be in violation of the statutory limits on loans by a National bank to its affiliates. The affiliate relationship existed because of Westgate's ownership of 50.53 percent of the bank's outstanding shares. Section 23A of the Federal Reserve Act limits aggregate affiliate loans to 20 percent of a bank's capital stock and surplus, and requires all such loans to be secured fully. The loans to Mr. Smith's enterprises exceeded that 20 percent figure and were not secured in the manner required by the statute. In addition, a number of irregularities were discovered in the treatment on the books of the bank and of borrowers concerning loans from the bank to Smith-related companies. Those irregularities were the subject of a draft report of possible criminal 269 violations written by the examiner and forwarded by Regional Administrator Larsen to the Washington Office for disposition. Apparently because of substantial doubts among Washington staff members as to whether the facts amounted to criminal conduct, the report was not forwarded to the Criminal Division of Justice. Deputy Comptroller Justin Watson met with Mr. Smith in San Diego in December of 1962 to discuss the bank's condition. Mr. Smith reported that 42,696 of the USNB shares held by Westgate had been transferred to Mr. Smith, thus apparently ending the affiliate relationship between the bank and Westgate. A $10 million reduction had been achieved in the Smith-related loans since the starting date of the September examination. The Deputy Comptroller and Mr. Smith agreed, inter alia, that Mr. Smith would supply the Comptroller's Office with a list of all companies in which he and his family were interested; that all loans to Smith-related companies would have the prior approval of the bank's board, either on an individual or a line of credit basis; that the books of the bank and of the borrowing corporation should at all times show the true use of proceeds for any loan involving a Smith-related company; and that any unsecured loan to a Smith-related company would be supported by an audited financial statement. Those agreements were confirmed by a letter to Mr. Smith from Comptroller Saxon dated December 11, 1962, and that letter was read to and discussed by the bank's board of directors on December 20, 1962. In the next few years, the loans to Smith-related companies diminished to the point that they were not even mentioned in the bank examination reports. Additionally, Mr. Smith began to relax his domination of the bank, and turn the management of its affairs over to younger officers, including his son. Mr. Smith's son died in 1965 and Mr. Smith again took over full time active control of the bank. No significant amount of loans to Smith-related companies appeared, however, until 1968. Fourth, in 1967 construction was begun by Westgate California Corporation on two hotels adjoining the bank in downtown San Diego. Additionally, Smith-related companies began to make heavy investments in real estate. Those projects created a need for cash. It has been learned since the bank was closed, for example, that Westgate California Corporation's borrowings from its subsidiaries and its investment in the two hotel properties both totalled about $50 million. In other words, Westgate drained about $50 million from its operating companies to finance its real estate investments. The 270 ultimate supplier of those funds was USNB, although the USNB records did not always accurately reflect that ultimate use of the proceeds of the loans. Those big investments in non-income producing real estate may have been a large contributing factor to the inability of the Smith-related companies to meet their maturing debts, and that inability in turn resulted in the rollover of loans; that is, repaying a loan to one of the Smith-related companies when it became due at the bank with funds borrowed by another company in an amount sufficient to cover the original principal plus interest. Such transactions always were disguised so that the true purpose of the loan and the use of its proceeds were not reflected on the bank's books. Fifth, the previously mentioned review of the examination reports and underlying work papers for that period, 1969, 1970, and 1971, shows that our examination team was not as thorough as it should have been in evaluating the loans to Smith-related companies. Information from Westgate's public financial statements does not seem to have been used to any great extent in judging loans at USNB. Records of loan performance, i.e., current payments of interest and principal, were relied upon to evaluate a loan as sound, in spite of the absence of complete financial data. Without going into detail of individual credits, the credits found by the review examiners to have insufficient supporting credit information on the August 11, 1969 examination totalled about $56 million, or 22 percent of total loans. The review examiners classified an additional $17 million of loans as substandard. In the April 15, 1970 examination, the two review examiners listed an additional $70 million of credits which lacked supporting credit information, or 28 percent of total loans. That examination was the first instance in which the review examiners noted letters of credit to Smith. Also, the review examiners classified as substandard an additional $16 million of loans. Classified loans on that examination, as listed by the review examiners, were 75 percent of gross capital funds, as compared to a 37 percent ratio in the original report. As regards the December 11, 1970 examination, the review examiners again noted that the examiners failed to list many loans which lacked supporting credit information. Additionally, the review examiners increased the substandard classification by $73 million. Consequently, classified loans to gross capital funds were estimated at 190 percent, rather than the report figure of 20 percent. In the last report reviewed, September 10, 1971, the review examiners listed an additional $133 million which lacked supporting credit information. They classified an additional $214 million in loans as substandard. Classified loans to gross capital funds were estimated to be 486 percent, instead of the original report figure of 25 percent. I would like to say in defense of those who performed earlier examinations that the classification of credits is not an exact science, and each examiner's judgment of a particular credit might be different. In addition, the two examiners who performed this task of reclassifying USNB's credits had the hindsight benefit of knowing the fate of the bank. A major factor in the substantial increase in classified loans for the review examiners was their classification of loans which lacked adequate credit information. In fairness to the examiners who conducted the original examinations of USNB, it should be noted that Office policy concerning classification of loans solely because of a lack of credit information has been somewhat equivocal. Some discretion must be left to the examiner not to classify loans which are obviously good because of supporting collateral or otherwise, even though the loans may lack complete credit information. During the past 7 months I have participated in staff conferences in most of the 14 regions of the Comptroller's Office and at each such conference I have emphasized the importance of a National bank maintaining adequate credit files on its loans. Sixth, the report of September 1971 contained some items which, with 20/20 hindsight, should have been a red flag to the Comptroller's Office. Direct loans to interests of the Smith family totalled $62 million. Loans secured by stock or debentures of Westgate California Corporation totalled $7 million. Ninety-five million dollars in letters of credit had been issued by USNB to support Smith-related enterprises. Loans requiring unusual attention, although not classified substandard from a credit standpoint, increased from $9 million to $19 million, with approximately $8 million of that total in loans to Smith-related enterprises. Eighty-nine million dollars in Smith-related loans were found to be supported by inadequate credit data. Mr. Smith had promised correction of many of the problems, and there seemed no reason to disagree with the examiner's statement that the Smith family for many years had used the bank as a vehicle to expand the family's financial empire, but that no loss had been incurred by the bank because of those activities. Similarly, the Comptroller's Office may not have acted as vigorously as it should in following up on the June 1972 report of Examiner Martin. The steps taken are outlined at pp. 41-42 of the printed record of this Subcommittee's November 27, 1973, hearings. Here again, the Comptroller's Office can be criticized in relying too heavily on the past record of performance by Mr. Smith at USNB and for not digging hard enough to get the facts and making an independent judgment based on those facts. Seventh, to some extent our examiners and the entire Office seemed to have been deceived by outright fraud. Examiner Martin traced, often through a half-dozen or more accounts, the ultimate use of the proceeds of many loans. Such tracing is not a routine part of the examination procedure. The tracing of those funds showed that they frequently were used for purposes other than those stated on the bank's records. Whether or not any violations of the Federal criminal laws were committed has yet to be determined, but it seems clear that the bank records were kept in a way deliberately designed to mislead our examiners, and the examiners in fact were mislead. Eighth, as the Subcommittee knows, C. Arnholt Smith was indicted in June 1974 for alleged actions involving USNB. That indictment resulted from criminal referrals made by our Office in the fall of 1972 and spring of 1973. The indictment is 44 pages long and contains 25 counts. I would like to submit a copy for the record. We have cooperated fully with the Department of Justice in its investigation and preparation of this matter and several examiners, including Mr. Martin, have been made available to the U.S. Attorney's Office. We also have made available to the U.S. Attorney's staff all records of our Office relating to USNB. Ninth, I understand from Chairman St. Germain's letter that the Subcommittee is interested in my view of the similarities or differences between the record failure of Franklin National Bank and the 1973 failure of USNB. There are two superficial similarities. First, each bank was much larger than the previous experience of any Federal banking agency with a bank which became insolvent. Second, cooperation among the banking agencies enabled a takeover procedure in each case which completely protected all depositors, and held to a minimum disruption of the financial markets. Otherwise, the two situations are dissimilar. The failure of USNB resulted from massive fraud. At Franklin, while there were some fraudulent transactions in the bank's foreign currency operations, fraud was not the principal cause of the bank's downfall. Franklin National Bank was caught in a liquidity bind resulting from a downturn in the economy coupled with incredibly poor management. Franklin was a peculiar situation in that it is only the second National 271 bank within the memory of the present staff of the Comptroller's Office to fail as a result of something other than fraud. Finally, the Comptroller's Office is taking several steps which should diminish the possibility of a recurrence of the events leading to the downfall of USNB. 1. On November 21, 1974, I issued regulations requiring that each director and principal officer of a National bank keep on file at the bank, for review by bank lending officers and our examiners, a current statement of the business ventures with which he is associated either as an officer or director or in significant ownership capacity, and of the relationships between those enterprises and the bank. Those regulations had been published in proposed form on June 20, 1974. The Comptroller's legal staff believes that the filing of false information or deliberate omissions on that statement would violate existing felony statutes. Thus, National bank examiners should be provided with a reliable source of information as to loans and other financial transactions between the National bank and its directors and principal officers. That information was not readily available at USNB and was ascertained in some instances only by the tedious tracing of loan proceeds through many checking accounts. I would like now to submit for the record a copy of those regulations together with the accompanying statement as sent to the Federal Register for publication. 2. Our examiners have been instructed to prepare at each examination a schedule of violations of law, such as the statutory lending limitation (12 U.S.C. 84) or the limitation on loans to affiliates (12 U.S.C. 371c), for comparison to previous examinations whether or not these violations are cured during the examination. Recurrent violations will become the subject of cease and desist proceedings by the Comptroller's Office. 3. A regulation including letters of credit within obligations subject to the lending limits of 12 U.S.C. 84 was published in the Federal Register on August 9, 1974. That regulation had been in the drafting stage prior to the closing of USNB, but had been delayed due to the problems of achieving uniform treatment of State and National banks. The final regulation was published in similar form by the Federal Reserve and the FDIC this past summer. The misuse of letters of credit at USNB was thoroughly explored at this Subcommittee's hearing of November 27, 1973. That regulation, if in effect during the last 4 years, might have eliminated one way in which the Smith-related companies obtained funds from 272 USNB. I would like to submit for the record a copy of this regulation as published in the Federal Register. 4. Our examiners have been reminded of the importance of satisfactory credit information about borrowers being retained in the bank files. The lack of such information was chronic at USNB. I personally have mentioned this subject at many staff conferences throughout the country. Large commercial loans of the sort involved at USNB should be supported by audited financial statements for the last 3 years, including profit and loss figures, and by information about the officers and owners of the company. When a borrower is a public company, its public filings with the SEC for the last 3 years should be retained in the bank's loan files and reviewed by our examiners. Those procedures are not new, but they are being reemphasized. 5. The Comptroller's Office has taken a number of steps to improve coordination within the Office when a situation appears to call for special oversight of a particular bank. Systems have been devised to speed up communication and to assure that the Comptroller and his top staff work with the examiners and the regional staff to develop and present to each bank an appropriate program to deal with that bank's problems. 6. In response to requests from members of the House Banking and Currency Committee my immediate predecessor as Comptroller, Mr. Camp, twice recommended amendments to the Financial Institutions Supervisory Act of 1966. Mr. Camp's proposals included: (a) Under the present statute an officer or director may not be removed from a National bank for repeated violations of law unless personal dishonesty and damage to the bank or another institution are provable. Under that statute, the repeated violations of the statutes regarding lending limits and loans to affiliates by Mr. C. Arnholt Smith would not of themselves have been grounds for removal. Not until fraud was discovered in the June 1972 examination could any action appropriately have been commenced against Mr. Smith. Even then, there is some doubt as to whether such a removal action would have been successful. Mr. Camp thus recommended, and I support the recommendation, that the Financial Institutions Supervisory Act, 12 U.S.C. 1818, be amended to eliminate the need for showing personal dishonesty and loss or damage as predicates for removal from a National bank of an officer or director who has violated a statute. (b) Under the present Act, unless a person has been convicted or indicted for a felony involving breach of trust, we may prevent his participation in the affairs of a National bank only after a cumbersome certification procedure involving the Federal Reserve Board. The Board of Governors, on receiving such a certification, must meet with the Comptroller and determine whether it wishes to serve a notice of charges and conduct a hearing. Mr. Camp suggested eliminating that cumbersome procedure by giving to the Comptroller's Office the same removal powers vested in the Federal Reserve, as to officers of State member banks, and in the FDIC, as to officers of State nonmember banks. However, I do not believe that the solution is to vest full removal power in the Comptroller as suggested by Mr. Camp. I believe that may be too much authority to be placed in any one individual. I do think, however, that the statute should be amended to give the Comptroller authority to issue a formal notice starting the removal proceedings, which will then be adjudicated before the Board. I recommend that the prosecutorial function now vested in the Board be given to the Comptroller, and that the Federal Reserve Board be left solely with the adjudicatory function. The Comptroller, since he will in effect be a prosecutor, should not sit as a member of the Board to judge the case. The power to initiate such a proceeding, without waiting for action by the Board, will in itself be a useful regulatory tool. Consideration is also warranted as to whether the Comptroller should be given the power to suspend someone in an appropriate situation pending adjudication by the Board. 7. The definition of affiliate contained in Section 2a of the Banking Act of 1933, 12 U.S.C. 221a should be broadened so that an affiliate relationship could be established by showing actual control of the bank, without the need to find 50 percent control of the bank's shares. That amendment would prevent evasion of the intention of the affiliate statute by juggling the number of shares around while retaining effective control in some other manner. Once an entity is determined to be an affiliate, its loans must be fully collateralled by marketable securities, and the total loans to all affiliates of any one bank cannot exceed 20 percent of that bank's capital and surplus. Had this proposed amendment to Section 2a been in effect, the situation at USNB could not have developed in the way that it did. 8. I understand from staff discussions that the Subcommittee is particularly interested in the number of times the Comptroller has exercised his power under the cease and desist procedures of the Financial Institutions Supervisory Act of 1966. That Act, of course, was not available when the Comptroller's Office encountered difficulties with USNB in 1962. It was available and was used in 1973. My predecessor Mr. Camp started an Enforcement and Compliance Division in the Law Department of the Comptroller's Office. In one form or another that Division has used the enforcement powers of the 1966 Act in each of the past 3 years as indicated below: 1971—3 1972—5 1973—9 1974—15 to date 9. Some courts have held that an officer making a loan for his own benefit and concealing that fact from the board of directors does not constitute a false statement on the books and records of the bank even though the loan is really only a sham transaction. Likewise some courts have held that where the debtors turned over the proceeds of loans to a bank official for his own personal use, that would not constitute a misapplication of funds of the bank unless the debtor was fictitious, financially irresponsible, or assured by the bank official that he would not be looked to for repayment. Title 18, sections 656 and 1005 should be amended to make clear that those interpretations are erroneous. 10. The Comptroller's Office is undertaking a complete review of the manner in which it exercises its statutory functions. Fifteen different formal bids were submitted to the Office by management consulting firms and others for conducting that review. We selected the firm of Haskins and Sells to undertake the study. They are being assisted by the firm of Carter H. Golembe Associates, Inc., and by Dr. Jack Guttentag and Dr. Samuel Sapienza who are associated with the Wharton Graduate School, University of Pennsylvania. The Haskins and Sells study has been divided into several phases and will be completed by June of next year. The study has been in progress for approximately 5V2 months. The Washington Office has been canvassed, approximately half of the regional offices have been studied in depth, a survey questionnaire has been mailed to the chief executive officers of all 4,600 National banks, and a survey questionnaire is prepared for mailing to all 2,000 National bank examiners. In addition, interviews with other regulators, members of Congress, and representatives of industry are in progress. This will be a sweeping review of all aspects of the agency. Special emphasis will be placed upon the 273 examination process, examination techniques, and the organizational structure of the Office. In addition, the study will deal with the evaluation of the banking industry in the years ahead, all support functions in the Office, recruiting and training operations, and automation improvements. The Haskins and Sells recommendations are expected to include goals for improved performance and guidelines for achieving them. There is no procedure, or group of procedures, which could completely eliminate the chances of a bank becoming insolvent because of self-dealing by the bank's management. Banks are run by human beings who may be clever and deceitful enough to defeat the restraints built into any system. The Comptroller's Office is run by human beings who may be deceived and who occasionally may make mistakes in judgment. Nevertheless, it is hoped that the new procedures and actions outlined here will do much to eliminate the possible recurrence of a situation such as that that caused the downfall of USNB. REMARKS OF ROBERT A. MULLIN, DEPUTY COMPTROLLER OF THE CURRENCY, BEFORE THE BANKERS ASSOCIATION FOR FOREIGN TRADE, SAN DIEGO, CALIF., APR. 9, 1974 "Country Credit Exposure" You may be assured that I do not disagree with the remarks of the other members of this panel. The fact that they have independent methods of evaluating the degree of country risks deemed appropriate for their banks confirms my faith in an independent banking system, with a minimum of governmental controls. Bank supervision, international in scope, is the business of the Comptroller of the Currency, and as required by the laws of this country, bank supervision includes regular examinations of our privately owned, National banks. Our examinations do include an evaluation of the country risks taken by each National bank, and we also consider a number of other related factors. The foremost of those factors is the overall soundness and solvency of the bank and the bank's ability to serve its community. Liquidity is a major factor we consider in determining the solvency of a bank. Country credits are a major factor in determining a bank's liquidity. The liquidity of country credits or in any bank asset depends largely on two basic factors: When will the asset be paid and/or when can the asset be sold. A country credit with a 4-year grace period followed by semiannual payments for 6 years and end274 ing, hopefully, with a balloon payment, has no liquidity in its first 4 years and, indeed, can be considered as a fixed asset except for its marketability. When I first commenced examining banks, more than 26 years ago, our three adverse classifications of bank assets bore the Roman numerals of II, III, and IV and represented the captions Slow, Doubtful, and Loss. The caption of "Substandard" has replaced number II, but the element of slow, that is, lack of liquidity, is still included in an examiner's decision to classify a country credit as "Substandard." You may have noted that we have been tolerant of country credits lacking liquidity only by their terms. If you have no concentration of such credits in your portfolio or by obligors they are usually free of criticism. However, such credits are highly vulnerable to adverse criticism, either as Other Loans Especially Mentioned or as Substandard, in periods of tight money when their marketability declines or when current information indicates the borrower may be unable to service the debt as agreed. I find current estimates of an obligor's inability to service his future debts as previously agreed, to be the principal cause of examiners' criticism of country credits. The examiner is, in effect, saying this asset appears to lack liquidity and the bank's solvency is jeopardized to that extent. I seldom, if ever, except in the case of Cuba, see country credits classified as "Doubtful" or "Loss" assets. Except for those, the examiner is not contending that the bank will experience a loss, he is contending the asset lacks liquidity. In today's banking, when we see your substantial liability totals in accounts captioned "Fed Funds Purchased," "Eurodollar Placements," "Security Repos," "Finance Acceptances," and "Stand-by Letters of Credit," you may be assured that we will take a serious look at the liquidity factors involved in country credits. Unlike countries, banks can disappear when they become insolvent. We often include, as country credits, those loans to separate entities which are in reality a part of a government's operations or are dependent upon the resources of that government for the servicing of their debts. Under those circumstances, the examiner may list all of those credits of one country, not as assets subject to criticism, but as a concentration of credit. To qualify for such a listing, the total of such credits must be 20 percent or more of the bank's gross capital funds. The examiner may also combine such credits and consider them to be in violation of the law, 12 U.S.C. 84, if they are dependent upon the government for their payment, or if they are for the general use of the government, or if the government is also borrowing. The examiners will use discretion in making such listings and they will be guided by factors which could affect the soundness and solvency of the bank. We will expect your lending officers to know their borrowers, their country credits, and, I do not mean that we will simply expect to find some financial data on file. I will expect your lending officers to have been in the country and to intimately know its characteristics. I also expect my examiners to be knowledgeable in that field. This month, I have some 40 examiners in Europe, Latin America, and the Far East. That is part of a crew of some 150 men and women examiners who have their official passports and are subject to foreign examination assignments. I am also, since the first of this year, making the direct assignments for the examinations of the international departments of our 100 largest banks. The examiners on those examinations may come from your head office city or they may come from New York, San Francisco, Chicago, or elsewhere, but they will be capable and they will render a separate report on your bank's international activities. We are also conducting quarterly seminars for our international examiners and some of you have assisted on this project by providing speakers on the subject of country credits. Our examiners must render a service to National banks. We have no funds allocated by Congress; we cannot ask you for sterile reserves to invest and we have not included your foreign office assets in your examination fee. Our progress in attempting to keep pace with your rapidly expanding activities is due largely to your assistance and cooperation and I am most appreciative. REMARKS OF DAVID C. MOTTER, DEPUTY COMPTROLLER OF THE CURRENCY (ECONOMICS), BEFORE THE DUN & BRADSTREET SEMINAR FOR BANK EXECUTIVES, CHICAGO, I I I . , MAY 13,1974, AND NEW YORK, N.Y., MAY 23, 1974 "Bank Capital Adequacy" The rather nebulous nature of the topic before us today offers a mixed blessing to both panelists and members of the audience. Presumably, no one here seriously expects this discussion to lay the capital adequacy issue to rest. Therefore, no one has great hopes and expectations for the results. On the negative side, it is somewhat frustrating for all concerned to have to wrestle with a problem, which, although perhaps soluble, promises to remain with us for the indefinite future. As an economist, there is a special frustration in this topic, we like to think that economic analysis can usually provide solutions to problems in the economic sphere. But the notion of "adequacy" itself is not an economic or market concept per se; it is, rather, a loose regulatory construction that sometimes appears to mean all things to all people. There are several reasons why bank capital questions are receiving so much attention today. First, a number of far-reaching changes have been and are occurring in the banking industry. A sharp expansion in the product and service mix of banking organizations has taken place. That expansion has been facilitated by the rapid growth of bank holding companies. The bulk of bank assets have moved under holding company umbrellas thus creating a new picture which still holds many uncertainties for both the industry and its regulators. The expansion of foreign banking activity by U.S. banks has proceeded rapidly, again generating new relationships whose full ramifications will not soon be known. The liability structure of the larger U.S. banks has been altered dramatically. Non-deposit short-term liabilities have grown in importance, while money market CD's have become a key element in liability management. Those changes have led to expressions of concern about the adequacy of banking's capital cushion. Whatever else may be said, it seems clear that each of the indicated changes—international expansion, broadening of product-service mix, creation of the holding company overlay, and increasing reliance on short-term money market sources of funds—has reinforced the importance of the capital structure of banks. Another reason for the increased attention being given to bank capital is the recognition that the expected continued growth of commercial banking will generate a need for a substantial inflow of new capital over the next few years. One authority estimates that the industry will need to double its existing capital of over $60 billion during the next 6 years. Only about half of that increase, it is estimated, will be available from retained earnings. If that prediction is borne out, the industry would have to tap the capital market for over $5 billion per year for each of the next 6 years, about twice the amount raised in 1972, the record calendar year to date. Doubt that the banking industry can successfully raise amounts of that magnitude has heightened the interest in the concept of capital adequacy. A third factor, and the proximate one, that has focussed attention on capital adequacy is the over275 lapping jurisdiction among the banking agencies. Many National banks, and most of the larger ones, are now subsidiaries of bank holding companies. Bank holding companies, of course, are under the direct jurisdiction of the Federal Reserve. Instances have occurred in which approval by the Fed of holding company acquisitions has been made contingent upon the raising of more equity capital by one or more subsidiary banks. Quite understandably, in its role as the regulator of bank holding companies, the Federal Reserve has taken a strong interest in the capital structure of both holding companies and subsidiary banks. In our Office, we look with favor upon the affiliation of a National bank with a parent holding company only when the net effect is to strengthen the position of the bank. We would not favor, and indeed would attempt to disallow, any affiliation in which it appears that the relationship with the parent holding company would weaken the position of the bank. We also believe that in all those instances in which the holding company is fully identified in the public mind with the bank, and that same identification exists for other subsidiaries of the holding company, that there is no realistic way to avoid bank association with any difficulties experienced by the affiliates. In other words, since banking is built upon public confidence, it is unrealistic to assume that a bank could stand idly by and allow the insolvency of a related affiliate. In consequence, we are aware that a realistic assessment of bank capital needs within a holding company structure must take account of that entire structure. In his November address, the Comptroller took note of the difficulties experienced by National banks when they wind up in the middle in an argument between regulatory authorities. The Comptroller offered a proposal that the Federal Reserve accept our position on the capital adequacy of National banks as a "rebuttable presumption." In other words, the Federal Reserve would accept our assessment except in those cases where it had what it considered to be good reason to differ. In the latter cases, interagency discussion would ensue with the purpose of attaining a regulatory agreement. In response to that initiative by the Comptroller, discussions at the staff level have been initiated between the Federal Reserve Board and our Office. Interchanges of relevant documents have occurred, and it is expected that the discussions will continue for some time. It is too early to indicate any resolution. With that introduction, let us look briefly at what the functions of bank capital are. In line with the traditional stance of bank regulators, it seems appro- 276 priate to call for capital as depositor protection. Such protection serves best when it allows a bank to absorb unexpected losses, and thus continue as a strong viable institution. A solid capital cushion allows bank regulators to sleep better at night. Coming close to the heart of any controversy concerning capital adequacy is another function of capital that has been advanced; that of a brake on undue or unwise bank growth stretching beyond the capabilities of management. That role may occur as a result of a conscious decision by bank officials, or it may stem from a regulatory directive. The former has been termed "conscious moderation of growth," the latter has been referred to many ways, often unprintable. One way to get a handle on the slippery concept of "adequacy" may be to look at certain historical relationships between losses and capital. Brent Leavitt, whose name is not unknown to many bankers who have recently given more than passing attention to bank capital, has noted that in 1934, the worst year for loan losses in the Great Depression, losses were equal to about 8 percent of total capital. In 1971, the aftermath of Penn Central led to loan losses equalling 2 percent of total equity capital. The 1971 losses exceeded those of any other year since 1939. At first glance, that relationship appears to demonstrate the "adequacy" of bank capital in some sense. However, we have already noted several banking developments of recent years that have added new and uncertain dimensions to the "adequacy" concept. Those developments have occurred while the capital ratios of the banking industry have fallen sharply. The decline of those ratios is not new. Comptroller of the Currency John Skelton Williams in 1914 suggested a statutory limit for deposits of eight times capital. At that time, the average for the National Banking System was 4.2 times capital. At a recent date, the aggregate figure for the system was 11.3 times capital. After some recovery during World War II and the next 15 years, a sharp decline in capital ratios has taken place since 1960. Assets have tripled while the growth of capital has been only half as great. Total capital as a percent of total assets has fallen from about 9 percent to about 7 percent, and the decline for the largest banks has been even larger. It is probable that the juxtaposition of falling capital ratios and developments generating new demands of unknown dimensions on capital structure would have focussed a good deal of attention on bank capital even in the absence of overlapping regulatory jurisdictions. In effect, the question for the banking industry and for bank regulators is this: Is there some minimum capital ratio below which the banking system is endangered? I do not pretend to have the answer to that question. Those who claim to have the answer usually maintain that the existing capital ratios represent rock bottom from the standpoint of banking solvency, and that from here on out, banks should be forced to add to capital in the same proportion that they add to total footings. That approach would necessitate spelling out minimum capital ratios. By the nature of things, those minima would have to be set at some sort of average level for the banking system today. One can easily see that if a minimum were announced at the average level of capital ratios for the industry, there would be a tendency for the management of all banks with ratios above the average to gravitate toward the minimum. That is the strongest single argument, I believe, for avoiding a hard and fast regulatory position tied to a particular ratio. Studies that have attempted to isolate the relationship between capital ratios and bank failure have not found a significant correlation. The difficulty in making such studies is that a given capital structure, as stated on the balance sheet, assumes that assets are worth their book value. An apparently strong capital structure can be wiped out by loan chargeoffs. The tautology that all insolvent banks have negative capital doesn't shed much light on the basic issue. The question of the status of capital notes and debentures arises in most discussions of capital adequacy. You are aware that there are some differences among the agencies as to the proper role of capital notes and debentures. Our Office encouraged the issuance of notes by a ruling in the early 60's that removed the stigma from them. We applied a rule-of-thumb that total capital notes and debentures could not exceed 50 percent of total equity capital. In point of fact, few banks have come close to that rule-of-thumb limit. For the National Banking System as a whole, capital notes and debentures make up about 7 percent of total capital. Our Office carefully reviews every application to issue notes, requiring evidence that the fixed charges can be met without weakening the bank. It is our view that the availability of note issuance provides a needed flexibility to bank management. In some market situations, it would be highly disadvantageous for banks to endeavor to sell equity capital. The basic premise behind our ruling on capital notes was that they provide depositor protection. We do not claim that they can fully serve the function of equity capital; it is obvious that notes cannot provide a cushion to cover losses as long as the issuing bank is a going institution. A subsidiary issue in connection with capital notes relates to interbank transactions, i.e., the sale of the notes of one bank to a second bank. Our Office prefers to hold such transactions to a minimum. Our basic reason for that position is that such transactions do not result in any net inflow of capital funds into the banking industry. In consequence, to the extent that such transactions become widespread, there is, in effect, a watering-down of capital requirements. We do not favor totally disallowing the use of interbank transactions, however, as, on occasion, that avenue can provide room to maneuver for the bank and for the bank regulator. Mr. George Vojta of Citibank has articulated in its most complete form a view of bank capital adequacy that I will call the market test approach. It rests on the basic premise, as I see it, that banks and bank holding companies must continuously subject themselves to a capital market test. Banking organizations must at all times compete for scarce capital with firms from every other industry in the economy. It is held that, if "unrealistic" and "artificial" requirements for additional capital are imposed by bank regulators, above and beyond those the market would require, banking organizations will be unable to compete effectively for capital funds. The rate of return on capital is the key factor in determining whether or not a firm can continue to "go to the well." Unrealistically large capital bases will lead to lower net yields on capital for a given level of net income. I must say, in all candor, that we have a considerable empathy for that "market view" of capital adequacy. We are aware that it would be unwise, from the standpoint of bank soundness and solvency, to force unrealistically high levels of capital upon banks, even were the market willing to make available such funds. It would lead to mounting pressures for ever higher rates of return on earning assets. Further, our Office has been in the forefront in the movement, during the past 12 years, to increase the responsiveness of bank organizations to the emerging financial needs of businesses and individuals. As banking organizations have expanded their product and service mix, they have improved their performance from the standpoint of the public, i.e., users of financial services and products. That expansion has cut two ways in terms of the impact on capital requirements. To the extent that bank managers foresaw correctly an emerging need for certain financial services, such foresight was likely to be rewarded with a good rate of return. Since even the 277 best managers are not omnisicient, however, on occasion there was a negative impact on earnings from new operations with an accompanying capital drain. Even those operations that prove to be quite successful over the years, e.g., credit cards, often generate substantial losses during the early operations. A forward looking regulator tries to encourage the institutions under his jurisdiction to be responsive and innovative. He recognizes the need for an adequate capital cushion to provide the necessary depositor protection as entry into new areas occurs. Yet there must also be recognition that imposition of unrealistically high capital requirements may, over time, be counter-productive. The "market test" approach to capital adequacy assumes a considerable degree of knowledge on the part of the investors in our capital markets. How good is the information held by, or available to, investors concerning banks? We believe that during the past 10 years, there have been significant improvements in the quality of information available to the public, both for depositors and investors. The annual reports to shareholders are more comprehensive and more meaningful than before. For banks with a relatively large number of shareholders, and for registered bank holding companies, additional reports are made available during the year. Beginning in 1972, the three Federal banking agencies began to make available upon request the statistical reports of income of commercial banks. In addition, for the first time the supporting schedules on the back side of the Report of Condition were made available. One may now request, and receive, from our Office, the statistical reports of income for 1971, 1972, and 1973 for any National bank. The supporting schedules for the Report of Condition for National banks are being made available upon request from 1960 forward. In general, then, despite some admitted gaps and imperfections, prospective investors can secure reasonably good income and expense and balance sheet data for commercial banks. From those figures, rates of return on capital and rates of growth may be computed and compared. It is clear that the regulatory agencies have an additional type of information concerning individual commercial banks that is not available at this time to the general public. I refer to the quality of assets, as determined in the bank examination process. In that connection, I would like simply to advance two points today, neither of which has moved very far as yet, as grist for the mill. 278 First, as most of you have noted from the Comptroller's speech on capital adequacy given in San Francisco in November, one of the exercises we have been carrying forward in the Office concerns the possibility of requiring higher capital ratios for banks with relatively poorer asset quality and allowing somewhat lower ratios for banks with higher quality assets. ("Higher/lower" adjectives would apply to the basic ratios between total capital and total assets. The adjectives are, of course, just reversed where the reference is to "asset to capital" ratios.) We have computed, for example, frequency distributions that show how many National banks would be required to add to their capital structure if banks with the highest quality of assets were allowed to reach, say, a ratio of total loans to total capital of 8.5, while those banks with the poorest quality of assets would be allowed to reach, say, a ratio of only 6.5. We find, of course, that some banks, were these standards to be applied, would need to add to their total capital, while many banks would not. Second, a valid question may be asked concerning whether the market should have additional information concerning the asset quality of banks. A large proportion of bank assets are in loans of various types, and loan quality varies substantially. Aside from chargeoff records after the fact, investors do not have a basis for comparing asset quality among banks. No one is seriously considering taking the step of nailing examination reports to the front door of banks, as has been facetiously suggested. However, it is conceivable that some additional information on asset quality could be made available. The purpose, of course, would be to bring some market pressure to bear upon banking institutions to maintain high quality loan portfolios. It is likely that our Office will carry out further computations relating to capital of National banks. We like to think that the more information we have, the more informed our judgment can be. However, such computations do not signal a departure from our basic Office position that in the final analysis, a reasoned and informed regulatory judgment must be made. We do not think that a purely mechanistic formula can ever be developed that will remove the necessity of such informed judgments. You are aware of the eight factors relating to capital adequacy which were inserted in the Comptroller s Manual in the early 1960's. Though these were deleted from a later edition, the current Comptroller emphasized in his San Francisco remarks that the factors still remained paramount in our Office con- sideration of capital adequacy. The eight factors are as follows: 1. The quality of management; 2. The liquidity of assets; 3. The history of earnings and of the retention thereof; 4. The quality and character of ownership; 5. The burden of meeting occupancy expenses; 6. The potential volatility of deposit structure; 7. The quality of operating procedures; and 8. The bank's capacity to meet present and future financial needs of its trade area, considering the competition it faces. You will note that the "quality of management" is listed as the first and foremost factor. In a very real sense, we believe our concern needs to be even more with "managerial adequacy" than with capital adequacy. We would like better touchstones against which to measure the quality of management. We are directing serious efforts toward this end within our Office. It is also certain that the contractor engaged to carry out a complete evaluation of our Office will devote a good deal of eflFort to the goal of securing better measures of managerial adequacy. There are some obvious criteria. In large part, these duplicate the market tests that are applied as banks seek additional capital funds. Certainly, the historical record of earnings, the rates of return on capital, the rates of overall growth, and the record of expansion into new and promising areas of financial service are all relevant. Again, the factor of asset quality is crucially important, and we are able to make some continuing judgment on that score. However, I think it is fair to state that, just as is the case with capital adequacy, we shall never be willing to live with a completely mechanistic formula in measuring managerial adequacy. At the margin, the element of reasoned judgment must take over. REMARKS OF JUSTIN T. WATSON, FIRST DEPUTY COMPTROLLER OF THE CURRENCY, AT THE GRADUATION CEREMONIES OF THE SCHOOL OF BANKING OF THE UNIVERSITY OF FLORIDA, GAINESVILLE, FLA., AUG. 16, 1974 "Bank Capital and Liquidity" Today perhaps the two most discussed topics relating to banking are bank capital and liquidity. Those topics come to the forefront when there is an erosion of public confidence. Bank stocks have fallen off sharply. The stability of our Nation's financial system, even the international financial system, has suffered severe shocks in the past few years. It started about 4 years ago with the Penn Central bankruptcy. That was followed by Equity Funding, the failure of the United States National Bank of San Diego, the Beverly Hills Bancorporation and the problem with its commercial paper, and now "serious trouble" in the Franklin National Bank of New York. In the international area, a prominent German bank recently failed. Other West European banks have suffered sizable losses in foreign exchange, and it is common knowledge that many of the so-called fringe banks in London are in trouble and, at the urging of the Bank of England, are being supported by the London clearing banks. I suppose the prime function of bank capital is to radiate confidence in the banking system. One banker said, "Capital begets courage, courage begets credit, and credit overcomes depression." Another banker said, "To move against the ebbtide of depression takes courage; it also takes capital." The commercial banking system relies on confidence for its continued successful operation to a greater extent than any other business. Adequate bank capital contributes to that confidence by placing a bank in position to absorb normal, and even unusual, losses as they occur. Adequate capital also gives confidence to the regulatory authorities as they have a comfortable feeling that the banking system will be able to absorb losses without impairing its capability to serve the credit needs of the economy. The problem is determining what is adequate capital. There can be no precise answer since we do not know what losses a bank will encounter in the future. A mathematical formula can be devised to obtain an answer but it has to be based on a set of hypothetical assumptions and can only be as valid as the assumptions. In much of the study devoted to capital adequacy, great emphasis has been placed upon various capital ratios. If those ratios show declining trends, it is often hurriedly concluded that bank capital is less than adequate and the strength of the commercial banking system is deteriorating. That is faulty reasoning. Perhaps an example can best illustrate. In 1893, the ratio of capital to assets was 30 percent. In 1945, the ratio was only 6 percent. Based on those ratios, the commercial banking system would seem to have been much stronger in 1893 than in 1945. Yet, there were 491 bank failures in 1893 and only one in 1945. Nevertheless, one should recognize there has been a historical decline in capital ratios. In 1875, the ratio of capital to total assets was 36 percent. In 279 1973, it fell to less than 7 percent. Today, the capital to assets ratio of the 10 largest banks in the Nation is 5 percent. That means capital is leveraged 20 to 1. Among the 30 largest banks in the Nation, the best capitalized bank has double the capital per asset dollar of the thinnest capitalized institution. While one should not make a fetish out of ratios, nevertheless, there appears to be a need for some guidelines so that everybody is playing in the same ballpark. Prior to World War II, the measurement of capital adequacy was the capital to deposit ratio. If deposits did not exceed 10 times capital funds, the regulatory authorities felt the bank was adequately capitalized. One regulator stated it was immoral for a bank to go over the one-to-10 ratio. In fact, former Comptroller John Skelton Williams considered issuing a regulation which would prohibit a National bank from accepting deposits if its ratio was over one-to-8. While the capital to deposit ratio had some validity, it gave no weight to the quality of assets or the capability of bank management. During and after World War II, the capital to deposit ratio got considerably out of line, principally due to large deposit increases which were invested primarily in government bonds as loan demands at that time were not particularly heavy. A new, arbitrary formula known as the risk assets ratio was devised by the agencies. Cash and Governments, which were considered riskless assets, were deducted from total assets, and capital was related to the remainder, all of which were considered risk assets. If a bank had more than $6 in risk assets for every dollar of capital, management could expect to be hearing from the regulatory agencies. Later, the formula was refined and the same standards maintained. Other formulas were also devised. One of the more prominent ones was the so-called A B C formula. That was an allocation of capital against assets. It was arbitrarily concluded that bank assets have varying degrees of risk. Those assets were lined up and a certain percentage of capital was allocated against them. The allocated capital was then totaled, and if the bank's existing capital structure was less than the total of the allocated capital, the difference was the amount that the bank was considered undercapitalized. In 1962, the Comptroller's Office abandoned the risk asset ratio and determined capital adequacy on such factors as asset quality, liquidity, management, etc. We are currently using that subjective test. There are other theories on capital adequacy. Perhaps the most prominent one now being discussed is the study made by George Vojta of the Citibank on 280 capital adequacy. Basically, Vojta's theory is that current earnings should be two times the average annual loss over the past 5-year period, and, that capital funds should be at least 20 times the average annual loss over the past 5 years. That formula does not provide for catastrophic losses. As Vojta emphasizes, if such losses occur, it is the responsibility of the Federal Reserve to support the banking system. Another theory is that capital should be sufficient to cover the three following conditions: • Absorb losses on the sale of unpledged liquid assets to meet approximately 20 percent of the unsecured deposits and short-term liabilities; • To cover substandard and doubtful assets by 20 and 50 percent, respectively; • To cover all fixed assets on the books. The problem of capital adequacy became more pronounced with the amendments to the Bank Holding Company Act several years ago. In many cases, the Comptroller felt a National bank which was a subsidiary of a bank holding company was adequately capitalized. However, when the holding company made application to the Federal Reserve for permission to make a non-bank acquisition, in many cases the Federal Reserve felt the bank was undercapitalized and required an injection of additional capital funds as a condition for approval of the acquisition. That left the bank squarely in the middle as here was one regulatory agency advising the bank it was adequately capitalized and another regulatory agency saying it was undercapitalized. At the suggestion of the Comptroller, discussions have been held between the Comptroller's Office and the Federal Reserve regarding capital guidelines. The fundamental disagreement between the two offices is the matter of subordinated capital debentures. The Board in Washington is presently using a ratio of equity capital to total liabilities. Subordinated capital debentures are included in liabilities and, therefore, a bank that has issued such obligations is penalized. The Comptroller's Office maintains that subordinated capital debentures are a part of capital as they afford depositor protection. For example, in the United States National Bank of San Diego failure, the subordinated debentures remained in the receivership while all the deposit liabilities were assumed by the Crocker National Bank. I believe the Federal Reserve had been under the impression that the Comptroller's Office was approving subordinated capital debentures without much of an investigation. However, the Comp- troller's Office has been quite meticulous in reviewing capital note agreements to make certain that such things as acceleration do not come into play at the drop of a hat. I hope we have reassured the Fed. Also, the Federal Reserve dislikes short maturities apparently feeling that a 7- to 10-year obligation is nothing more than a time certificate of deposit. In order to reach an agreement, the Comptroller's Office has proposed more stringent standards. For example, we indicated a willingness to lengthen maturities out to a minimum of 20 to 25 years with a sinking fund coming into play during the latter life of the obligations. Also, we would probably be receptive to requiring that subordinated debentures be convertible. In retrospect, I believe it would have been wise had we made the convertibility feature mandatory 10 years ago on the theory that we would only approve subordinated capital debentures for an institution we felt was viable. If the institution continued to operate successfully, the attractiveness of the convertibility feature would have come into play and those subordinated debentures would then move down into the equity capital base. The Comptroller's Office does not want to be wedded to any inflexible mathematical computations. We believe management is the key to a well run institution. Therefore, we believe a well-managed bank, free of asset problems, is entitled to operate on a higher leveraged capital base than one which has asset problems. Some of you may be aware of the rating system which is used by the Federal Reserve and this Office. Generally speaking, banks rated "A" have classified assets not exceeding 20 percent of capital funds, "B" 20 to 40 percent, "C" 40 to 80 percent, and "D" over 80 percent. We proposed to the Federal Reserve that "A" banks' loan portfolios not exceed 8V2 to 9 times capital funds; "B" banks, 7Vfc to SV2; "C" banks, 6V2 to 71/2; and "D" banks, no higher than 6V2 times. The Federal Reserve thought that proposition had merit but preferred a ratio of capital to total assets with allowances being given for highly liquid unpledged assets. We cannot disagree with that suggestion and we are hopeful that some guidelines can be worked out which will be beneficial for the industry. We would hope those guidelines are not rigid but flexible. Even if suitable guidelines can be developed, the present climate for raising capital is bleak. It is virtually impossible to sell common stock today because of investor disenchantment with the market generally. Most banks' price-earnings ratios have fallen considerably in the past year. Capital debentures are not attractive because of high interest rates. However, an interesting source of capital has recently come to light, and its immediate acceptance by the investment community seems to assure it a prominent place in the market of finance. It is the floating or variable interest rate note. Citicorporation was the first to enter those uncharted waters. It announced a $250 million dollar issue but, when prospects for success were so overwhelming, the offer was increased to $850 million. Several other bank holding companies have followed suit, and Standard Oil of Indiana has recently announced plans to market a similar issue. Floating or variable interest rate notes are not attractive to banks because present regulations require a minimum maturity or redemption period of at least 7 years. However, it seems feasible to explore the suitability of that instrument's use by banks on a subordinated basis. It seems to me that it would be quite attractive to certain investors who are interested in safety and are satisfied with a rate slightly higher than the market rate for a prime security such as Treasury bills. If the average investor is willing to forego the protection offered by Federal Deposit Insurance, and it seems many of them at the present time are, perhaps that could be a new source of capital for banks. If that type of instrument catches on, and it seems that it will, serious imbalances in the banking system could occur. Funds could flow from the smaller banks to the large holding companies if the saver believed it was imprudent to keep his funds in time or savings accounts. Floating notes appear to appeal to savers with balances in the $5 to 25 thousand range, probably the most desirable and profitable of all retail time accounts. Non-holding company banks could very well be left with an ever-increasing volume of small, low profit savings accounts. Bank liquidity already stretched could come under further strain as the competitive advantages passed to the holding companies. One shudders to think what could happen if large corporations make a massive move into the market with floating rate notes. So, therefore, I believe serious exploration should be given to the matter, in order that banks, particularly the small and medium-sized ones can remain competitive. Some people may claim that those instruments could be a step towards indexing the economy and bowing to inflation. However, that is already happening now that many labor contracts have cost of living escalation clauses. Regulation Q is the culprit causing disintermediation by the small saver. The overwhelming success of the recent offering of the "Nifty Nines" by the U.S. Treasury indicates that the small saver is no 281 longer satisfied with the artificial ceilings imposed by that regulation. The artificial ceilings on interest that banks could pay on time deposits was one of the more important causes of the credit crunches of 1966 and 1969. The shift of funds from financial institutions into direct investments in both those years strained the liquidity of the banking system. We are witnessing that again today. It seems patently unfair that ceilings be imposed on the small saver while rates on prime loans, Federal funds, and CD's over $100,000 can go through the roof. Even though those loan rates today are hitting their historical highs, they would be even higher were it not for the fact that the small saver has been subsidizing them by foregoing a fair return on his funds. Some people can justify low rates as a way to preserve an adequate supply of mortgage money. Interest ceilings are not attracting funds for the mortgage market. Those ceilings that were designed to provide mortgage money are the very instruments that are drying up the pool. Clearly, the ceilings are not accomplishing the only purpose that can justify them. Consumer activists are running around the country literally trying to tear down banks and business. Those activists have, for the most part, maintained complete silence on the loss of purchasing power experienced by the small saver who, by the way, also is a consumer. It seems to me that those activists define a consumer as a borrower and a saver as a capitalist. Now I'll get back to the second part of my topic, bank liquidity. In many respects, bank liquidity is more important than capital adequacy. Bank regulatory agencies cannot pay cash letters. Furthermore, there is some flexibility in asset evaluation and the regulatory agencies can stretch a little in a touch and go situation. The Comptroller's Office has been carefully following the liquidity positions of National banks for over 10 years. We have devised a liquidity formula which, although not perfect, had worked reasonably well until the Nation's larger banks began extensive money market operations. The present liquidity formula appears adequate for non-money market banks. Its reliability diminishes when used for money market banks. A bank can acquire shortterm liabilities and place $1 in liquid assets for every $5 or $6 it places in long-term assets and retain what appears to be on the surface a reasonable liquidity ratio. In fact, there was an article recently published entitled, "Let the Comptroller's formula work for you," and the article advocated precisely that. 282 Perhaps there has been some abuse, but that is a rather futile way to windowdress liquidity. Bank liquidity has been significantly reduced over the past several years. For example, we have seen situations where the net borrowed Federal funds position, securities sold under agreements to repurchase, and due to banks—time, primarily foreign, represent as much as 40 percent of total balance sheet footings. If negotiable CD's and CD's over $100,000 are added to the above figures, the percentage shoots up to 50 and 60 percent. Another disturbing observation is the habitual heavy use of Federal funds by certain banks. We recently reviewed a selected group of 30 banks which have been heavy in a net borrowed Federal funds position. Their Federal funds borrowed positions as of March 31, 1974 ranged from a low of 63 percent to a high of 482 percent of capital funds, including loan loss reserve. It also ranged from 3 to 22.8 percent of total balance sheet footings. For the period ending March 31, 1974, the 331 large Federal Reserve reporting banks had 106 percent of their capital funds and loan loss reserves in a net borrowed Federal funds position. We also analyzed the 30 largest National banks on a little diflFerent basis to determine what percent of short-term liabilities were being used to support a loan portfolio. We took total deposits and deducted secured deposit liabilities, due to banks—time, and CD's over $100,000 to arrive at an adjusted deposit figure. In some cases, loans to adjusted deposits ran as high as 150 percent. From that analysis, it appears quite obvious that many banks are borrowing short and lending long. Their ability to maintain liquidity depends upon the buying of funds and that depends upon market confidence. If confidence is lost, a bank has a liquidity problem of almost unmanageable proportions. Therefore, I cannot overemphasize the need to match asset maturities and liability maturities in such a manner that assets can be liquidated, if necessary, at a minimum loss. At the present time, this Office is devising a more sophisticated liquidity analysis for money market banks. Basically, it will match asset and liability maturities. Of significance, it will not consider the general loan portfolio as a source of liquidity. Our experience has taught us that over-reliance on the loan portfolio for liquidity is a fatal mistake. In a critical situation, loan liquidation never comes up to expectations. That is even more so today, when many banks have strayed from sound credit standards and many industries which, a few years ago, appeared to be acceptable credit risks are now experiencing financial difficulties. Those credit problems are also compounded in some cases by sizable market depreciation in the investment portfolio. When interest rates ease, banks seem to stretch their investment maturity positions. They then become locked in when the credit crunch comes and liquidity in the portfolio evaporates. I think the time is ripe for bank management to review capital and liquidity positions. Efforts should be made to upgrade loan portfolios. Speculative loans should be shut off and those on the books should be weeded out. A heavy loan portfolio should be offset by unpledged high-grade short-term securities. I think we are in an era where the banking business will face its severest test since the 30's. It behooves us to reassess our operations and then ask ourselves, "Do we feel comfortable?" REMARKS OF JUSTIN T. WATSON, FIRST DEPUTY COMPTROLLER OF THE CURRENCY, BEFORE THE ALABAMA BANKERS ASSOCIATION, GULF SHORES, ALA., SEPT. 12, 1974 "Changes in National Bank Examinations" Our country, its society, and the economy are always on the move. The business of banking has not taken a back seat and, in fact, it has been at the forefront and provided leadership in our changing times. New banking services, new ideas, and new methods are constantly being offered to the public. Competition triggers such action. The Office of the Comptroller of the Currency is giving a great deal of attention to the environment in which National banks operate so that we will be abreast, if not ahead, of changes in order for us to function in a constructive manner. By way of background, let me say that when the government feels it necessary to have administrative regulation for an industry, as it has for banking for more than a century, it almost always does so by assigning such responsibility to a particular agency or group of agencies. The purpose of regulation by independent agencies such as we have in banking is to insure that the performance of that industry is consistent with the National interest and the individual needs of the public. Surveillance may be directed mainly toward the prevention of abuses which, in banking, will injure the public through bank failures. Regulation, however, may go beyond monitoring and may establish minimum standards for performance. The reason for the use of independent regulatory agencies is that the necessary degree of regulation involves close supervision of the management of the industry. Standards of performance are too complex and too changeable to be prescribed by statute. Considerable judgment is required in the assessment of performance. The strength of the independent regulatory agency is the combination of the executive, legislative, and judicial powers it holds. Its actions and decisions are usually not subject to review by another office or agency in the executive branch of government. The Comptroller's Office was the first independent regulatory agency established by the Congress; the first Federal agency to which the Congress made a broad delegation of executive, legislative and judicial powers; and the first on which it conferred an independent status within the executive branch. Examinations and special reports are used as a regulatory tool by the Comptroller's Office and, I am sure, by all bank regulators. The severity and scope of an examination may vary depending upon the condition of the bank in relation to the economy. However, there is usually no disagreement between bankers and the regulatory authority about its ultimate objective, sound and safe banks. Managing liabilities is a highly important banking function. It relates to the source of funds for meeting loan requests and commitments, and depositor demands. Often today, liability management means to locate, accept, and purchase additional liabilities to meet those requests and demands. The manner in which that is accomplished ties to the liquidity, and perhaps the solvency, of the individual bank, if not the banking system. Successful liability management in the sense that it is generally referred to in banking today, demands full recognition that certain basic rules must not be violated. That is, we should recognize the difference between daily excess cash on deposit and hot money in search of a home at the highest price. Second, restrictions are necessary on the maturities of assets which are to offset hot money purchased. That, I feel, is a pressing issue in view of the proportions of large CD's, Federal funds, securities sold subject to repurchase, and other forms of day-to-day and shortterm borrowing, including foreign transactions. The latter have been used freely in some liability management concepts and in the quest for a better bottom line. Further, in that regard, we cannot overlook loan commitments, letters of credit, and ineligible acceptances. With respect to the nature of commitments to lend, you may recall that the Federal Reserve Board, the Federal Deposit Insur283 ance Corporation, and the Comptroller of the Currency, on April 6, 1973, addressed letters to the chief executive officer of any bank with deposits exceeding $100 million, asking for careful judgment on the appropriateness of the bank's credit risks and the source of funds for the take-down, based on a consideration of economic conditions. In summary, dangers associated with the practice of liability management are borrowing short to lend long, excessive interest rate competition, and reverse fund flows resulting from confidence crises or for other reasons. I hasten to add that the risk of borrowing short to lend long is not uncommon to banking, in a sense it is what banking is all about. But the assumption of such risks, while necessary in banking, must be kept within reasonable limits. The practice of liability management, as it has evolved, has permitted the creation of a large volume of interest sensitive and potentially confidence sensitive short-term liabilities. In addition, a fundamental theory of traditional banking states that risk assumption in assets will vary in proportion to cost of liabilities to carry those assets. The fundamentals should not be forgotten. Our new "Maturity Schedule of Assets and Liabilities", which at outset will be requested from only the 200 largest National banks, is the outgrowth of the considerable attention in our Office recently to our need for more comprehensive liquidity data. That schedule has been discussed with officers from a number of banks, and the BAI has also been most helpful and constructive to us in our deliberations. Another area that we are looking into is the matter of the loan evaluation on large national credits which are held by two or more banks under a master loan agreement. We are of the strong opinion that identical loans to national concerns by banks in various parts of the country should be treated uniformly by our examiners. That has not always been the case, and it has created problems for bank management where a line is classified at their bank, but has been passed elsewhere. We know bankers exchange such information. Also, lack of uniformity has created some problems with the Internal Revenue Service in their acceptance of loss classifications in National banks. Accordingly, the Comptroller's Office is taking steps to initiate a program whereby a team, probably three, of select examiners from various regions will visit lead banks for the purpose of classifying or passing lines of credit totaling $20 million or more, in which participations have been sold to various banks throughout the country. 284 That classification would then apply to all National banks sharing in the credit until the next review at the lead bank. Interim reviews would not occur unless there were significant changes in the credit. Each participating bank, Regional Administrator of National Banks, and the Conference of State Bank Supervisors would receive a copy of the classification. Incidentally, the American Bankers Association and the Conference of State Bank Supervisors have worked closely with us in formulating this program and it appears likely that the Conference of State Bank Supervisors will initiate a similar arrangement. When that happens, classifications arrived at in State banks that are lead banks will be made available to us. We believe this program will eliminate the existing inconsistencies and, more important, will lead to a more thorough and more constructive evaluation of the particular credits under consideration. In the long run there should be a time savings because it will not be necessary to repeat a thorough evaluation of each and every one of the participating banks. In our examination of foreign departments, we have already initiated a similar program concerning the treatment of country credits. Our Office is establishing a Consumer Affairs Division to work in a broad area affecting consumerism as it relates to banking. Those areas of concern include the refusal to grant credit on the basis of sex or race, violations by banks of various statutes designed to protect consumers' interests, improvement of banking public relations in helping individual borrowers understand extensions of credit and encouragment to banks to establish systems to answer customers' questions about credit. We also want banks to educate their officers and employees about consumer laws and regulations so that they do not give the public erroneous, or unlawful, information. It is probably relatively rare that a bank deliberately attempts to take advantage of a customer, but it is not rare for a bank or loan officer to act in ignorance of pertinent laws. The examining function of the Comptroller's Office must be prepared to anticipate such problems. The Division will be prepared to advise the Comptroller on policy matters, for example, the repossession procedures of banks. The Division's director, who has experience in bank examination, will be responsible for implementing the program and will be assisted by a staff consisting of consumer affairs specialists and National bank examiners who are knowledgeable about consumer banking. Because of their familiarity with the examination process, those examiners should be able to develop examination procedures dealing with consumer affairs and statutes and to coordinate the necessary training of regional staff and field examiners. Legal counsel will also be available to the staff in order to keep abreast of various Federal and State consumer protection laws and to give advice on the Division's response to specific complaints. The purpose of establishing a consumer affairs division stems from the commitment by the Comptroller's Office to uniformly enforce both Federal and State consumer protection laws as they relate to National banks. That commitment extends beyond answering Congressional criticism of our past endeavors and should also consist of more than courteous cooperation with various State enforcement agencies. National banks must understand that it is our policy to enforce those laws and to encourage their cooperation in executing the spirit of the law. A worthwhile result will be increased confidence in the banking system and the Office of the Comptroller. Earlier I mentioned that the banking industry is experiencing rapid and profound changes. The barriers to statewide and even nationwide banking are falling. Commercial banks are becoming financial conglomerates, and are spreading out both geographically and in terms of services provided to their customers. Tremendous asset growth, centralization or decentralization of various banking functions, greater sophistication in asset and liability management and the development of new and specialized services are part of the challenge before the Office of the Comptroller of the Currency and the individual National bank examiner. Accordingly, a thorough and all-encompassing review of the Office and bank examination practices and procedures is underway by Haskins and Sells. That project is our effort to ensure that the services provided by our Office are relevant to today's needs. The Office must be capable of not only participating in, but leading the rapid evolution of dramatic change which the banking industry is currently undergoing. The project will help to determine and improve the quantity and the quality of services provided to the public and to the National banks. The major objective is to attain the highest possible level of professionalism and expertise in the Office of the Comptroller of the Currency. The evaluation will be a review of the objectives, scope, and resulting examination report of the work done by the examiners, with the idea of determining whether the objectives of the Office are properly stated in view of the Comptroller's responsibilities as established by law. The study will review the impact of expanded computer capabilities on the total operation of the Office. We will try to determine what National bankers would like from the Comptroller's Office that they do not get at present. We want to establish a comprehensive early warning system so that we will be able to act instead of reacting. The study is scheduled to be completed during the summer of 1975. Perhaps some of the more significant changes to take place in banking over the past 10 to 15 years have been in the area of automation. As a result, we have had to change some of our examination procedures and that has affected banks, their operating policies and procedures, their internal audit programs, and their reporting. The most obvious change in examination was the initiation of the EDP examination back in 1967-68. We now have select examiners, trained in data processing, located in all regions. Their responsibility is the annual examination of data processing operations in banks, bank service corporations, and private companies performing automated services for banks. As a result, banks have had new standards and procedures for EDP operation, auditing and output. Before the days of automation, when our field representatives went into a bank to conduct an examination they were instructed to take control of various ledgers (demand, savings, installment, etc.) and run up the individual ledger sheets on an adding machine to prove totals to the bank's general ledger controls. Then came automation. Suddenly, we found ourselves unable to make an independent proof of automated applications. Instead, we accepted printed trial balance reports generated by a computer. In our original procedure that would be analogous to asking the bank's various posting clerks to run up individual ledger sheets on an adding machine after posting and then to present the tape to us as a trial balance. In other words, as we accept computer output not produced under our control, the integrity of the information declines. Often the format of data contained on computer output is not easy to follow and transcribing to work papers is difficult and time consuming. With that in mind, our Office is currently testing an automated retrieval system to be used in conjunction with commercial and trust examinations. Basically, the system will give us the capability to extract selected data from individual bank magnetic files and print reports designed to our specifications. Not only will that restore data integrity to former levels 285 but it should also improve examiner efficiency and effectiveness by: • Standardizing the output an examiner must use; • Eliminating much of the laborious and time consuming task of transcribing data from the bank's output media to work papers; • Performing some analysis on the data which would aid the examiner in his evaluation of the condition of the bank; • Assisting the training of new examiners by making output reports consistent and identical no matter what bank is being examined. Let me hasten to add that such a retrieval system is by no means a reality. We are only in the testing stages of a pilot program. If the results of our tests indicate that the automated retrieval examination system is unworkable, we will have to explore alternative methods. The biggest problem we foresee is operational. It is very difficult to develop a retrieval system with enoughflexibilityto be used in the wide variety of computer system environments existing in the country's 4,700 National banks. Another area relating to data processing is our minimum standards of output. Those standards simply outline the information our Office deems necessary to effectively examine and regulate the bank. In most instances the bank should already have all of that data and more, so there should be little effect on banks. The minimum standards of output are being revised and will soon be reissued. Any new requirements we come up with would certainly directly affect only new systems under development. During the examination a great deal of time is spent on the loan portfolio. Many banks have, or are in the process of, automating commercial loans. The computer output that replaces the manually posted liability ledger has not always proven adequate for our needs, or even for the bank's needs. The history of the loan and any indirect liability are often missing or are very difficult to get. Therefore, in many parts of the country, our examiners have taken the initiative and have discussed our data requirements with the systems design people to make sure those requirements are incorporated into systems before they become fixed. In the past those efforts have not always proven successful, but our Office's emphasis on cooperation and involvement will continue. In many instances the banks have actually developed specialized reports for examiners, including automated line sheets. Some of the very large banks have what is referred to as the "examiner's package" which kicks out pre-defined reports specifically for 286 use by the examiner. A request to have the package run may be made directly or through the audit department. We recognize that increased complexity of bank operations, tightly scheduled computer usage, and delayed posting, make it imperative that our Office request only reports that are needed. Another significant change in recent years has been the closer look at bank audit departments, their levels of competence, and the completeness of the internal audit program. To a large extent, that is a result of the EDP examination. Initial reviews found audit department quality poor and audit coverage inadequate. Traditional audit techniques were found to be ineffective in an automated environment. We feel our EDP examination has highlighted the audit weakness, not only to the Comptroller, but also to the bank and particularly to the bank auditor. The tremendous increase in volume and the advent of computerized bookkeeping has made the proof and balancing of trial balance totals to the bank's general ledger increasingly complex and difficult to accomplish. That is particularly true for such applications as demand deposits and credit card operations. Perhaps our examiners have not kept pace with developments and, therefore, find it increasingly difficult to understand the entire operation, the handling of unposted and rejected items, and the final settlement to preestablished totals. We hope to improve that phase of the examination through better training of new examining personnel and closer supervision by the examiner-in-charge. The curriculum of our new assistant examiner's school will have a large section on the settlement of automated applications. With the widespread use of computer output microfilm, our Office for the first time is confronted with the problems of examining an application without the benefit of printed hard copy output. Up to this point we have always insisted on hard copy output. How much longer can we insist on printed hard copy? The rising cost of printing and other complications may force us to reconsider and accept other forms of output. That may require new methods of examination. The last matter I would like to comment upon is our concern over self-dealing. The experience of the Comptroller's Office indicates that unsafe and unsound banking practices are frequently associated with self-dealing by the bank's managing officials. Thus, the identification and scrutiny of self-dealing transactions is important both to the bank and to the Comptroller's Office. One of the most common manifestations of self-dealing is the extension of credit on an unsound basis. Other examples include various types of contracts negotiated between the bank and a business enterprise of a bank official on other than an "at arms length" basis which sometimes benefit those individuals improperly on their interests, to the detriment of the bank. This past summer we solicited in the Federal Register, comments concerning a proposed regulation to deal with that problem. Many constructive suggestions were received and the regulation in its final form will be published before year-end. The purpose of the regulation, which will require principal officers and directors of National banks to keep on file with the bank a report relating to their business interests, is to establish an informational base upon which bank management and the Comptroller's Office may more accurately assess the extent to which and manner that a National bank may be engaging in transactions with its own directors and senior officers. I believe that sums up the major changes in the Comptroller's Office recently. We hope these changes will be constructive, not only for ourselves, but the National Banking System as well. REMARKS OF JUSTIN T. WATSON, FIRST DEPUTY COMPTROLLER OF THE CURRENCY, BEFORE A SYMPOSIUM OF THE WORLD TRADE INSTITUTE, NEW YORK, N.Y., OCT. 24, 1974 "Identifying Legitimate Off-Shore Investors" I am honored to participate in this symposium and to be among such distinguished guests. The topic suggested to me is, "Identifying Legitimate OffShore Investors." In view of the rather narrow range of that topic, I thought perhaps that I would first endeavor to introduce you to the Office of the Comptroller of the Currency and comment briefly on the bank regulatory setup in the United States. The Office of the Comptroller of the Currency is the oldest regulatory agency in the United States Government. It was organized in 1863. The Comptroller of the Currency is a one-man bank regulator who is appointed by the President and confirmed by the Senate for a 5-year term. All other regulatory agencies are boards or commissions of from 3 to 7 members. The Comptroller is also a director of the Federal Deposit Insurance Corporation. The primary responsibility of the Comptroller's Office is the supervision of the National Banking System. That is done through the examination process. The purposes of bank examinations are to determine solvency of the particular institution under examination and to ascertain whether it is operating within the framework of applicable bank ing laws. The existing law requires that the Comptroller examine each National bank four times every 2 years, however, he may waive one examination during this period. The Comptroller also has the authority to examine any National bank as frequently as he deems advisable. A report of examination is prepared by the field examiner in charge and a copy is submitted to the Comptroller and one to the bank. The Office of the Comptroller of the Currency has several divisions. They are examining, legal, economic, organization, and administrative. We have are approximately 2,550 employees. The examining division is by far the largest, with over 2,000 people in the field in addition to Washington personnel. The examining division is in a constant state of travel, moving from one National bank to another conducting field examinations. The principal function of the examining process is the evaluation of bank assets for collectibility. The examiner has the authority to chargeoff assets which he believes are uncollectable. Those chargeoffs diminish capital funds and if they exceed a bank's capital structure the Comptroller has no choice but to put the bank into receivership or attempt to merge it with a stronger institution. Other functions of the Comptroller's Office are the chartering of new National banks, granting permission to existing National banks to branch within the geographic limitations imposed by State law, and permitting mergers to take place where the resulting bank will be a National bank. There are approximately 4,650 National banks. Those banks have approximately 15,000 domestic branches and 600 foreign branches. Total resources in the National Banking System are $490 billion, outstanding loans $272 billion, deposits $395 billion, and capital funds $38 billion. Last year National banks had net income of $3.8 billion. Although National banks represent approximately one-third of banking institutions in the United States, they hold approximately 60 percent of the Nation's banking resources. There are approximately 13,500 commercial banks operating in the United States; 9,000 are Statechartered banks which are under the supervision of the 50 State banking authorities. Those that are members of the Federal Reserve System are also supervised by the Federal Reserve. State-chartered, federally insured banks that are not members of the Federal Reserve System are also supervised by the Federal Deposit Insurance Corporation. All National banks are required by law to be members of the Federal Reserve System. That membership is optional for State banks, and only approximately 1,000 287 are members. Those members are, however, generally the larger State-chartered institutions. The banking industry has expanded rapidly in the past 15 years. New banking services have been initiated and competition has become much more fierce. The scramble for deposits and non-deposit funds has continued at an accelerated pace. Funds to meet loan demands have out-stripped the normal deposit growth and that has created an active and aggressive money market and the development of new money market instruments. Along with that development came the money brokerage business. That business not only deals with the brokerage of negotiable certificates of deposit, security repurchase transactions, and Federal funds, but also with deposit placements. Most such operations are conducted on a highly ethical basis, however, as in any field of endeavor, unethical operators creep into the picture. With most banks aggressively seeking additional loanable and investable funds, they can become victims of unethical operators, commonly known as confidence men. Banks have always been plagued with external and internal crimes. In the days gone by, it seemed the classic crimes were bank robberies and embezzlements. However, in the 60's, confidence men were able to get into the banks through fraudulent loan schemes. That continues; however banks are much more vigilant. In the late 60's, groups of banks sprang up in the Channel and Guernsey Islands and in some of the Carribbean Islands. Those banks were nominally capitalized and solicited funds in the United States offering high interest rates. Most of the depositors' funds were placed in insider loans and the banks subsequently failed with the American investors losing sizable amounts of money. Several banks in the United States were also victims of those institutions. In some cases banks made loans against their worthless certificates of deposit, granted immediate credit on drafts drawn upon those institutions, and, in some cases, even made direct deposit placements. The Comptroller's Office endeavored to warn National banks when that situation came to our attention. The classic case of fraud was perhaps the Bank of Sark, which operated on the Isle of Guernsey in a rented, one-room, third floor office staffed by an ex-barmaid. In another case, a bank was operated out of a gasoline station in Nassau, Bahamas. In April 1972, a new scheme came to the attention of the Comptroller's Office through inquiries by a number of financial institutions in Florida and Ohio. We learned that individuals were approaching banks and indicating to them that they represented for288 eign interests, primarily from the Middle East, who desired to place millions of dollars with them for a long period of time at rates very favorable to the banks. The typical offer was that many millions of dollars would be delivered to a bank in exchange for a 20-year maturity certificate of deposit at a rate approximately 4 percent below the market. The interest would be compounded over a 20-year period. None of the depositors' names were revealed to the banks. When interest rates fell in the United States those propositions slowed down; however, they picked up again at the beginning of 1974. Mysterious money brokers began making the rounds of U.S. banks offering to deposit millions of dollars of Middle East wealth at terms that seemed too good to be true. Although most banks were wary, some were sufficiently enticed that they began negotiating with those brokers. Thus far, we know of no banks receiving deposits under that scheme. We did closely follow one transaction in which a bank agreed to accept such deposits, but to date, the funds have not arrived. We fear the letter could be used to swindle another financial institution. We believe the real aim of the suspected confidence men is to get a bank letter signed by the chief executive officer agreeing to accept a huge deposit. That letter, perhaps altered, could then be used as a reference to get a loan somewhere else or as an inducement to get another bank to pay a finder's fee in advance for promised big deposits that would never materialize. One banker reported he was approached by a man offering $20 million to be deposited in the form of a certificate of deposit with a 20-year maturity at a rate approximately 4 points below the current market rate. He practically lived at the bank for 3 months. Details of the proposed transaction kept changing, telexes flew back and forth between Switzerland and the United States. Finally, everything was agreed upon; however, the funds failed to show up. The man the bank had been dealing with went to Switzerland and only postcards have been arriving since. Another banker informed this Office that his bank was offered a multi-million dollar deposit in exchange for certificates of deposit by a money broker. The banker indicated interest. The money broker said he knew of $300 million in foreign funds which certain unnamed depositors wanted to place in American banks for a long period of time. Names of the prospective certificate holders were indefinite; however, two organizations were mentioned which have international business interests. The banker subsequently informed the broker he was not interested in the proposition due to lack of information as to the source of funds and the principals involved. He also questioned why the large money center banks were not approached and why an investor would want to freeze funds for 15 years or more at fixed low interest rates. He also was unable to obtain any information on the financial responsibility of the broker. Overall, approximately 100 National banks reported to us that they had been approached with virtually identical propositions. To the best of our knowledge no bank has received funds through such an arrangement, and none have lost funds through the payment of advanced brokerage fees. Thus, we have no basis on which to report those transactions to the Department of Justice. In addition to approaches to commercial banks, solicitations have also been made to corporations operating in this country. Basically, a money broker offers to lend a company several millions of dollars again at a rate approximately 4 percent below the current prime. A fiduciary bank will supposedly handle the loan for the unnamed lender and confirmation will come within 15 days. All the corporation has to do is produce a letterhead application agreeing to the loan and a separate letterhead agreeing to the payment of 4 to 5 points to the money broker. Here again we have no knowledge of funds actually being delivered to make the loan and, we believe in some cases the corporation paid the points and thus was bilked. We have endeavored to obtain information on several of the firms and individuals to determine their types of business, methods of operation, and business connections. One firm operating in Georgia was not listed as a Georgia corporation or as a foreign corporation authorized to do business in Georgia. The Securities Division of the Secretary of State of the State of Georgia did not list the firm as a broker in securities. Local banks had no credit information on the firm and the firm did not have a listed telephone number in the Atlanta, Ga. telephone directory. Although the firm's letterhead contained an address, the management of the building where the firm was supposedly located stated that no such tenant existed. They also reported they had received numerous inquiries about the firm. Another broker whom we checked had a very checkered career. He was promoting stock of the company and managed to unload that stock on various insurance companies over which he and some other disreputable associates had working control. He was also involved with an infamous land swindler who was under indictment. There is an old principle in banking which states, "know your customer." That is applicable not only to borrowing customers but depositing customers as well. Dealing with strangers can be hazardous and identifying legitimate domestic and off-shore investors is of the utmost importance. Fortunately, the American banking system has a very good record in that respect. REMARKS OF JUSTIN T. WATSON, FIRST DEPUTY COMPTROLLER OF THE CURRENCY, BEFORE THE FIRST GOLD, SILVER, AND FOREIGN EXCHANGE SEMINAR, AMSTERDAM, NETHERLANDS, NOV. 8, 1974 "How Inflation is Affecting and Will Affect American Banking" I am honored to participate in this Seminar and to be among such distinguished guests. My subject is "How Inflation is Affecting and Will Affect American Banking." Inflation is the most important thing on the minds of the American public today. Although the inflation rate is higher in many other countries, the American economic and financial community agree that the continuation of the present high rate of inflation in the United States will wreak havoc on the country. The U.S. economy has been in an inflationary spiral for the past 40 years. At times the rate has been negligible, but during the past few years it has been accelerating to reach the present level of about 12 percent. During the Great Depression of the 30's, which was accompanied by 8,800 bank failures, the price level in the United States dropped dramatically. The Roosevelt Administration undertook a set of economic policies designed to maintain and even to increase existing price levels. Certain legislation such as the National Recovery Act and the Fair Trade Act was passed. That was nothing more than legalized pricefixingin an attempt to eliminate price competition and was ultimately ruled unconstitutional. After the Depression and through the early 60's the American banking system operated in an ultraconservative manner. President Kennedy came into office in early 1961 at a time the economy of the Nation was almost at a standstill. He was persuaded that a slowing rate of economic growth was in the large part a consequence of unduly restrictive monetary policy. For the previous 10 years, the money supply had been increasing at an annual rate of 2.1 percent, which was less than many economists and bankers thought necessary to support a real growth of the economy on the order of 4 percent a 289 year. President Kennedy expressed the view that a tight monetary policy could not be allowed to induce a recession and a marked change in monetary policy ensued. From 1961 to 1967, a period of sustained high performance by the economy, the money supply increased at a rate of 3.3 percent per annum, well above the average rate of increase in the 50's. President Kennedy appointed James J. Saxon as Comptroller of the Currency. A cordial, vigorous extrovert, Saxon brought many changes in bank regulation to the Office of the Comptroller of the Currency. Those changes were followed by many of the State banking authorities. Mr. Saxon encouraged vigorous bank expansion, more liberal powers, and innovative ideas to make the banking industry not only more competitive but to serve the public interest as well. With dramatic changes in mind, Saxon requested each National bank to give its judgment concerning needed changes in the laws, policies, and regulations affecting operations. At the same time, he appointed a committee of 24 bankers and lawyers to review the National bank responses and to report their conclusions and recommendations. The committee published a document entitled, "National Banks and the Future." In general, the committee recommended many changes that would broaden the lending and investing powers of National banks and that would enable many of them to expand the scope of their activities. From 1962 to date, the banking system of the United States has experienced unprecedented expansion. Annual Federal expenditures during that period have increased from $100 billion to $300 billion. Government deficits and rapid credit expansion are the two principal causes for inflation in the United States. The Federal Reserve System has been applying monetary brakes on the economy. That has resulted in high interest rates but has had little effect on dampening the ardor of bank borrowers. In fact, soaring interest rates have placed an additional burden upon the United States banking system. For all practical purposes the equity market in the U.S. is closed. The long-term bond markets are very thin. The commercial paper market has become very restrictive with only the largest high-grade corporations able to use that avenue of finance. The banking system has been accommodating those borrowers who, under ordinary conditions, would be going to the marketplace. The economic psychology of the average American individual and the business community seems to be, "it is cheaper to buy today than to buy tomorrow, and what is borrowed today can be paid 290 back tomorrow in depreciated currency." That attitude has placed increasingly heavy demands upon the credit facilities of U.S. banks. The rate of savings in the United States has slowed down. Many depositors are drawing down deposit funds to place them in U.S. Government bonds or money market instruments where the rates are substantially more attractive. Loan demand has far outstripped deposit growth in the past decade. That has resulted in a new technique called "Liability Management." That is simply buying money on a short-term basis by selling large certificates of deposit, obtaining time deposits from other banks, buying Federal funds, and selling securities under agreements to repurchase. Those transactions are engaged in to support and expand loan portfolios. We have seen cases where such items make up as much as 50 to 60 percent of a bank's balance sheet footings. It is, in essence, borrowing short and lending long. The ability to continue that practice depends on market confidence. If confidence is lost, a bank has a liquidity problem of unmanageable proportions. Inflation and high interest rates have resulted in distortions in credit markets. Housing is a classic example. Banks have diverted funds from the housing market because more attractive rates could be found elsewhere. Thrift institutions which are limited in interest payment to depositors have also experienced deposit run-offs. That has resulted in a substantial decrease in home building. Home building is highly sensitive to money market developments. Soaring interest rates and reduced availability of mortgage credit have greatly aggravated the poor condition of that industry which is already suffering from sharply higher land and construction costs and from the erosion of the consumer's purchasing power. A few benchmark indicators of the level of inflation in the United States may be useful. Between 1971 and 1972, consumer prices in the United States rose 3.3 percent, a level which we regarded as uncomfortable at the time because consumer prices had risen about 1.6 percent a year from 1960 to 1965. Now, an annual rate of growth for prices of 3.3 percent would be considered a desirable and difficult goal to achieve. Between 1972 and 1973, price increases accelerated to a rate of 6.2 percent. In 1973, from January to December, prices rose about 8.5 percent. That price acceleration has continued, with the consumer price index up 8 percent between January and August of 1974. If the rate of inflation continues at the pace of TABLE 1 Rate of Change of Prices and Money Supply as Compared to Federal Budget Surplus or Deficit, Selected Postwar Years Year Percent change, year to year in consumer prices Percent change in the money supply1 1944 1945 1946 1947 1948 1949 1950 1951 1952 1953 1954 1955 1956 1957 1958 1959 1960 1961 1962 1963 1964 1965 1966 1967 1968 1969 1970 1971 1972 1973 1.7 2.3 8.5 14.4 7.8 -1.0 1.0 7.9 2.2 0.8 0.5 -0.4 1.5 3.6 2.7 0.8 1.6 1.0 1.1 1.2 1.3 1.7 2.9 2.9 4.2 5.4 5.9 4.3 3.3 6.2 -1.0 -0.3 4.5 5.6 3.8 1.1 2.7 2.2 1.3 -0.7 3.8 1.6 0.6 3.1 1.5 3.7 4.6 4.6 2.4 6.6 7.8 3.5 6.0 6.3 8.7 5.7 Surplus or deficit in Federal Gov't budget (National Income Accounts) as a percent ofG.N.P. 3.3 -0.9 3.2 1.9 -1.1 -1.9 -1.6 1.0 1.4 0.5 -2.3 -0.2 0.7 -0.7 -0.7 0.1 -0.5 0.2 0.0 -1.6 -0.8 0.9 -1.2 -2.1 -1.4 0.0 Dashes indicate information not available. 1 Money supply is defined here as private demand deposits plus all currency outside the Treasury, the Federal Reserve Banks, and the vaults of all commercial banks. SOURCE: Economic Report of the President, Feb. 1974, pages 249, 300, 310, and 328. TABLE 2 Percent Change in Consumer Price Index for Selected Countries, 1963-1974 Year 1963 1964 1965 1966 1967 1968 1969 1970 1971 1972 1973 19741 United States United Kingdom 1.2 1.3 1.7 2.9 2.9 4.2 5.4 5.9 4.3 3.3 6.2 12.4 1.9 3.2 4.8 3.9 2.5 4.7 5.4 6.4 9.4 7.1 9.2 21.6 France 4.8 3.4 2.5 2.7 2.6 4.6 6.4 5.3 5.5 5.9 7.3 16.8 Germany 3.0 2.3 3.4 3.5 1.4 1.5 2.7 3.7 5.2 5.7 6.9 7.0 Italy 7.4 6.0 4.5 2.4 3.2 1.3 2.6 5.0 4.8 5.7 10.8 21.4 Netherlands 3.8 5.5 5.2 5.8 3.2 3.6 7.5 4.4 7.6 7.8 8.0 10.8 1 1974 figures are based on trends in price index from December 1973 to June 1974. SOURCE: Economic Report of the President, Feb. 1974, page 359. International Financial Statistics, 146-147, 202-203, 264-265, 368-369, and 374^375. Oct. 1974, pages 140-141, 291 recent months, the United States will experience a gain of better than 12 percent for the year, the first time the United States will have experienced such a rate of price increases since 1947. The shock and dismay we in the United States presently feel concerning rapid price increases arises from our history of rather modest inflation, even during the turbulent times of World War II. By way of comparison with the experience of other countries, United States prices rose approximately 6 percent between January and July of 1974. During the same period, Canada experienced a gain of 7 percent, the United Kingdom an increase of 9 percent, West Germany 3 percent, France 7 percent, Japan 10 percent, and Italy 12 percent. As you can immediately see, the German experience is considerably better than that of the United States, but, some other European countries are experiencing rates of inflation even more troublesome than that felt in the United States. Expressed as an annual rate, some European countries will see price increases near 20 percent this year, and others will have figures closer to 6 percent. Naturally, we know not all countries