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☆
☆
☆

Annual Report
☆
☆

to the Directors
☆
☆

1952
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☆
☆

FEDERAL RESERVE B A N K OF M I N N E A P O L I S




I N D E X

Directors and Officers.............. ....... .. .. .......... ....1
.
Changes of Directors and Officers....... ....
................... 6
Economic Developments... ......... ..... .......... ........ —.. 8
As s e t s .

.. ..... ..
.

Liabilities ............... ... .....

...... 16
..18

Departmental and Other Comments •
’
Check Collection .....................

............. 22

Currency and Coir#.. ... .................................. 26
Discount and C r e d i t ......................................30
Duplicating.. ...............
.
....
. 31
Examination ......... ..................................... 32
Fiscal Agency............................................. 34Noncash Collection ...................................... 4-2
Personnel ................................................ 4-3
Planning.... ........................................
.4-7
Protection-................................................ 4-9
Public Services' .....................................
50
Purchasing-............................................... 59
Research.................................................. 60
Reserves (Member Bank)................................... 62
Safekeeping .... .......................................
64Wire Transfers-........................................... 65
Capital Accounts.
Dividends..
Bank Premises ___ _________ ______
Earnings ..
Expenses




.. 67
..
70
.. 71
.
73
.. 79

HEAD OFFICE DIRECTORS
AND MEMBER OF FEDERAL ADVISORY COUNCIL

Directors
Roger B. Shepard, Chairman, and Federal Reserve Agent
Paul E. Miller, Deputy Chairman
Term Expires
December 31
Class A
H. N. Thomson, Vice President, The Farmers and Merchants
Bank, Presho, South Dakota

1953

Charles W. Burges, Vice President and Cashier, Security
National Bank of Edgeley, Edgeley, North Dakota

1954-

Edgar F. Zelle, Chairman of the Board, First National
Bank, Minneapolis, Minnesota

1955

Class B
William A. Denecke, Livestock Rancher,
Bozeman, Montana

1953

Ray C. Lange, President, Chippewa Canning Company,
Chippewa Falls, Wisconsin

1954-

Homer P. Clark, Honorary Chairman of the Board, West
Publishing Company, St. Paul, Minnesota

1955

Class C
Roger B. Shepard, 322 Endicott Building,
St. Paul, Minnesota

1953

Paul E. Miller, Director, University of Minnesota
Agricultural Extension Division, St. Paul,
Minnesota

1954-

F. A. Flodin, President, Lake Shore Engineering Company,
Iron Mountain, Michigan

1955

Member of Federal Advisory Council
Joseph F. Ringland, President, Northwestern National Bank,
Minneapolis, Minnesota



1953
-1-

OFFICERS

0. S. Powell, President
A. W. Mills, First Vice President
H. C. Core, Vice President in Charge of Personnel
Personnel:
Cafeteria
Education & Welfare
Medical
Personnel Maintenance
Retirement System
Social Security
Office Boys & Pages
C. W. Groth, Vice President
H. A. Berglund, Assistant Cashier
Assigned to Helena Branch
E. B. Larson, Vice President
*M. B. Holmgren, Assistant Cashier
Fiscal Agency
Securities:
Purchase and Sale
Federal Taxes
Commodity Credit Corporation
H. G. McConnell, Vice President
Bank Examination
Securities Exchange Act
*J. Marvin Peterson, Vice President and Director
of Research
F. L. Parsons, Associate Director of Research
Library
Publications
Research
Statistics

'"Effective January 23, 1953



-2-

OFFICERS (Contd.)
Otis R. Preston, Vice President
*Christian Ries, Assistant Vice President
Public and Bank Relations
Announcements
Circulars
Correspondence
Press Relations
M. H. Strothman, Jr., Vice President
George M. Rockwell, Assistant Cashier
Industrial Loans
Loans & Discounts
Regulation V Loans
Sigurd Ueland, Vice President, Counsel, & Secretary
Legal
*A. W. Johnson, Assistant Vice President
*John Gillette, Assistant Cashier
Check Collection
Equipment Repairs
Ordinary Mail
A. R. Larson, Assistant Vice President
Noncash Collection
Registered Mail
Routing Symbol
Securities:
Safekeeping
Vault
0. W. Ohnstad, Assistant Vice President
Accounting:
Expenditures
Monthly and Annual Directors1 Reports
Building
Duplicating
Protection
Purchasing
Security Files
Telephone
* Effective January 23, 1953






OFFICERS (Contd.)
M. 0. Sather, Assistant Cashier
Accounting:
General Books and Bank Accounts
Transfer of Funds
Foreign Exchange Reports
Files & Old Records
M. E. Lysen, Operating Research Officer
Operating Letters
Operating Manuals
Planning:
Efficiency Studies
Equipment
Office Forms
Suggestions

Kyle K. Fossum, Auditor

Clement Van Nice, Assistant Vice President
Currency and Coin

HELENA BRANCH DIRECTORS

John E. Corette
Chairman

Term Expires
December 31
G. R. wilburn, Livestock Rancher,
Grass Range, Montana

1953

A. W. Heidel, Vice President, Powder River County Bank,
Broadus, Montana

1953

John E. Corette, President and General Manager, Montana
Power Company, Butte, Montana

1954-

J. Willard Johnson, Financial Vice President, Western
Life Insurance Company, Helena, Montana

1954-

George N. Lund, Vice President and Cashier, First
National Bank, Reserve, Montana

1954-




-5-

CHANGES
DIRECTORS AND OFFICERS

The regular November election resulted in the re-election of
Edgar F. Zelle, Chairman of the Board, First National Bank of Minneapolis,
as Class A director, and Homer P. Clark, Honorary Chairman of the Board,
West Publishing Company, St. Paul, as Class B director.

F. A. Flodin,

President of the Lake Shore Engineering Company, Iron Mountain, Michigan,
was reappointed by the Board of Governors as Class C director.

All terms

expire December 31, 1955.
The Board of Governors reappointed Roger B. Shepard as Chairman
and Federal Reserve Agent.

Paul E. Miller was reassigned as Deputy Chair­

man.
The Board of Governors redesignated John E. Corette, Butte,
Montana, as a director of our Helena Branch for a two-year term beginning
January 1, 1953.
Our Board of Directors appointed J. Willard Johnson, Financial
Vice President of the Western Life Insurance Company, Helena, Montana, and
George N. Lund, Vice President and Cashier of the First National Bank,
Reserve, Montana, to succeed former directors Theodore Jacobs, Missoula,
Montana, and E. D, MacHaffie, Helena, Montana.

These terms expire Decem­

ber 31, 1954-.

Wm. E. Peterson, Assistant Cashier, retired on April 30 after
3U years of service at the bank.




-6-

J. N. Peyton, after serving as Chairman of our Board for 3 years
and as President for 16 years, retired as of July 1.

As of the same date,

Oliver S. Powell returned from the Board of Governors, where he served
approximately two years as a member, to assume the presidency of the
Minneapolis Federal Reserve Bank.
On November 25 our Board of Directors advanced Kyle K. Fossum
to Auditor and 0. W. Ohnstad to Assistant Vice President.
On January 23, 1953, our Board of Directors advanced J. Marvin
Peterson to Vice President and Director of Research, Christian Ries and
A. W. Johnson to Assistant Vice Presidents, and elected M. B. Holmgren
and John Gillette as Assistant Cashiers.




-7-

ECONOMIC DEVELOPMENTS
AND U.S. DEBT OPERATIONS IN 1352

The ultimate measure of an economy's performance is its output.
By this standard, and others, the American economy performed admirably in
1952.

Record levels of production and employment were achieved during the

year in spite of predictions by some that the restrictive monetary policy
adopted earlier would generate unemployment with its consequent lower level
of activity.

Even the prolonged shutdown of the basic steel industry was

not sufficient (seriously) to disturb business operations.
The Federal government which had financed military operations in
World Wars I and II with large borrowings from both the banking system and
the public, managed from mid-1950 to mid-1952 to finance almost all its
total expenditures with tax receipts.
In the last half of 1952 the public debt rose by $3 billion.
The bulk of this increase represents higher investments by government
agencies and trust accounts and a net increase in the general fund balance.
On a cash basis, the government incurred a deficit of $1.6 bil­
lion in calendar 1952 compared to cash surpluses of $.4 billion and $1.2
billion in 1950 and 1951, respectively.
This splendid budget record,together with the high production
and the better control of the monetary system, contributed importantly to
the large degree of price stability enjoyed throughout the year.
Wholesale prices continued the decline originated in the Spring
of 1951 while consumer prices edged slightly upward.

In contrast to 1951

when it rose 8 points, the consumer's price index was up 2 points in 1952.



-8-

The relative stability in the purchasing power of the dollar
meant that the higher consumer expenditures which characterized 1952
represented additions to the physical amount of goods and services taken
by consumers rather than higher prices paid.

This contrasts with the

previous year when a large part of the additional consumption expenditures
represented higher prices paid.
In spite of their higher expenditures in 1952, larger incomes
permitted Americans to save at approximately the same high rate as in the
latter part of 1951.

These large savings were reflected in the statements

of all types of financial institutions.

Assets of life insurance companies,

savings banks, and savings and loan associations increased at a higher rate
than in previous years.

Commercial banks reported sharp additions to time

deposit accounts.
To the extent that savings satisfy the demand for funds from
borrowers, pressure on the banking system to expand credit is diminished.
Such pressure became increasingly strong during the year.
Despite funds supplied to borrowers from large savings and credit
expansion, the demand for credit remained sufficiently strong to induce
interest rates higher than at any time in nearly two decades.

At the end

of 1952 three-month Treasury bills were yielding as much as long-term govern­
ment bonds had yielded less than three years earlier.
The rate of return on the shortest government obligations, the
bill rate, has been climbing, except for brief intervals, since mid-194-9.
The yield on long-term governments has climbed too, although not so much
and not so soon.
Early in 1950 long-term government bond prices began a decline
which was accelerated in the Spring of 1951 when the Federal Reserve System



abandoned policies intended to support the prices of these securities.
Contrary to the expectations of some pessimists the withdrawal
of support from the government security market has not resulted in serious
declines or panics.
At no time since the Treasury—Federal Reserve "Accord" which
gave birth to the withdrawal of support purchases of government bonds
has any U.S. government issue traded at less than 95.

In terms of histori­

cal precedent this is an extremely favorable record.
The decline was orderly.

At no stage was there a dumping of

government securities on the market by holders who feared a collapse;
instead the decline encouraged the retention of those securities, this
being a prime objective of the new open market policy.
Previously, banks, as well as some nonbank investors, had almost
continuously reduced their holdings since 194-5.

During that time com­

mercial banks liquidated government securities worth $32 billion.

These

banks have added $6 billion to their government portfolios since the ac­
cord.

It would seem that the coincidence of the reversal of the liquidation

trend and the date of the accord were more than accidental.

Obviously,

higher yields and lower prices for government securities induce their
purchase while the threat of capital loss deters their sale.
Even the greater attraction afforded the obligations of state
and local governments by the interplay between their tax exempt feature
and the higher income taxes levied after Korea was not strong enough to
overcome the repercussions of the decline in U.S. government securities.
The yield on a sample of municipal bonds was 1.98%, 2.00$, and
2.17$ in 1950, 1951, and 1952, respectively.




-10-

The changed situation in the market for U.S. government credit
was not without its effect on the market for private credit.

This was

to be expected since the return on Federal government securities represents
the pure rate of interest—no risk premium—while the return on private
loans includes both pure interest and risk premium.
The average return on a sample of the best quality corporate
bonds was
tively.

2, 62%,

2.86%, and 2.95% in the three years ended with 1952 respec­

Most commercial banks have announced more than once since early

1951 higher charges on loans of all kinds.
Of course, lenders have benefited frcm these higher charges.
The benefits can be measured partly by the change in gross earnings reported
for all member banks.

In 1951 these banks reported gross earnings more

than 12 per cent higher than in the previous year.
not by so much.

Expenses rose too, but

The greater increase in earnings than in expenses is re­

flected by the 15 per cent rise in net current earnings before taxes
between 1950 and 1951.

Data for 1952 are not yet complete but such fragmen­

tary data as have been made available indicate the continuation of these
trends after 1951.
Benefits have not been confined to commercial bank lenders.

Life

insurance companies, for example, report that earnings on invested funds
amounted to 3*18% in 1951 compared with 3-09% in 1950 and 3.06% in 1949.
In part these improved earnings reflect a shift to higher yielding assets,
but in part they reflect higher yields on all types of earning assets.

Life

insurance policy holders, savers, are the ultimate recipients of these
higher earnings.




-11-

Once again the forces of supply and demand have been permitted
to assert themselves in the market for funds.

The resultant higher interest

rates have served a dual role of discouraging borrowers and encouraging
savers, thus equating the supply and demand for funds without undue genera­
tion of more credit.
This is not to say that credit expansion did not occur in 1952—
it did.

But our economy was growing and such an economy needs more credit.

The expansion would doubtless have been much greater if the Federal Reserve
System had not stopped feeding reserves to the banking system by engaging
in support purchases of government securities.

Evidence that the expansion

which did occur was not excessive can be found in the record of stable
prices throughout the year.
The composition of the new credit which was extended last year,
with respect to the type of borrower, was not as favorable as it might
have been.

The removal of consumer credit controls in May was accompanied

by a reversal of the decline which had been in progress in the amount of
consumer credit outstanding.

Subsequently, consumers added $3 billion to

their indebtedness bringing such borrowings to an all time high.
In one sense consumers are out of the reach of general credit
controls which operate through changes in the interest rate.

This is be­

cause consumers as a group are less sensitive to changes in interest rates
than are business borrowers.
Under these circumstances a general tightening of credit might
easily cause an undesirable shift in the composition of credit—more for
consumers and less for business.
In ordinary times this shift might not be considered undesirable.
But with the defense program growing in an economy already fully employed,



-12-

it seems the interests of defense would best be served if more funds
were made available to the productive elements of the economy while less
funds were made available to finance consumption.
Also,

in the event of any future possible economic decline,

the repayment of these debts by consumers can only serve to accelerate
the fall in demand for the economy's products.

Such a fall is at the heart

of any recession.
Although the Board of Governors suspended Regulation W on May 7
"....after careful review of developments in the economy generally and in
the markets directly affected by the regulation", they recommended to the
Congress that authority for regulation of consumer credit be continued
after June 30, 1952, in order that it could be reinstated should subsequent
developments warrant such action.

The authority was not extended.

Less than a week after suspension of Regulation W the Board of
Governors in effect ended the Voluntary Credit Restraint Program when they
withdrew requests for compliance with the provisions of the program.
Another important selective credit control, Regulation X, was
suspended on September 16.

Under the 1952 amendments to the Defense Pro­

duction Act no minimum down payment requirement in excess of 5 per cent
could be imposed on the purchase of residential properties if the season­
ally adjusted annual rate of housing starts fell below 1.2 million units
for three successive months.
When the Bureau of Labor Statistics found that housing starts
had fallen below the 1.2 million annual rate, the Board of Governors sus­
pended Regulation X which had provided for restriction of nonresidential
loans as well as residential.




-13-

Actually, many prospective borrowers who could not meet the terms
of the regulation found that, even after suspension, lenders were not willing
to accommodate them.

This is particularly true of borrowers who had hoped

to obtain FHA or GI loans.

Lenders had more attractive alternative in­

vestments .
Thus, last year witnessed the suspension of three important sup­
plements to indirect controls, namely, Regulations W and X, and voluntary
credit restraint.
These essentially qualitative controls are powerful tools that
should be employed by the Federal Reserve System in conjunction with the
essentially quantitative indirect controls at times when the threat of
inflation warrants their use.

The absence of any alarming developments

after the removal of selective controls last year is a tribute to the ef­
fectiveness of indirect controls.
Although the use of indirect controls has raised the cost of
borrowing to the U.S. Treasury, Treasury debt instruments have become more
attractive at the same time.
For the first time since the Victory Loan of 194-5 the Treasury
issued marketable bonds last year.

The first issue was offered in exchange

for maturing securities; the other was an issue for new money.
More attractive provisions for owners of Savings bonds, announced
in May, failed to cause these obligations to become an important source of
new money for the Treasury.

A slight increase in the amount outstanding

occurred during the year, however, in contrast to the previous year when a
slight decrease occurred.




-U -

One curious aspect of the changing structure of interest rates
in recent months has been a flatening of the yield curve.

That is, the

difference between the yield on short-term obligations and the yield on
long-term obligations has been diminished.

Long-term securities have

declined in price proportionately less than short-term securities.
In the last few days of 1952, 90-day Treasury bills were yielding
more than the longer Treasury certificates.

Although this was a temporary

condition associated with the great stringency in the money markets at the
time, it illustrates the nature of the fundamental changes which have re­
sulted from the operation of free markets.
In contrast to the previous year when the Federal Reserve System
added, net, government securities worth $3.1 billion to its portfolio,
Reserve bank assistance to Treasury financing in 1952 was of a magnitude
which required a net addition of less than a billion dollars.
The reserves provided to the commercial banks by these purchases
were less than the amount necessary to replace the reserves lost during
the year because of higher currency circulation.
Thanks mostly to expanded borrowing from the Federal Reserve
banks and to a gold inflow, commercial banks obtained sufficient reserves
to support their higher deposit liabilities.
Required reserve balances would have risen more rapidly except that
a substantial part of last year's deposit increase was in the form of time
deposits which require less reserves than do demand deposits.




-15-

MILLION DOLLARS

M ILLIO N DOLLARS

1600

1600

1400

1400

1200

1200

1000

1000

800

800

600

600

400

400

200

l
M
O
t

200

-

1917




23

25

27

29

31

33

35

37

39

41

43

45

47

49

51

53

COMPARATIVE STATEMENT OF ASSETS

MINNEAPOLIS AND HELENA BRANCH COMBINED
(Thousands of Dollars)
12-31-52
Assets:
Cash Reserves:
Interdistrict Settlement Fund
Gold Certificates with F.R.Agent
Redemption Fund - F.R.Notes
Total Gold Certificate Reserves
Total Other Cash
Bills Discounted
Foreign Loans on Gold
Industrial Loans
IT. S. Government Securities:
Bills
Certificates of Indebtedness
Notes
Bonds
Total U. S. Government Securities
Due From Foreign Banks
F.R. Notes of other F.R. Banks
Uncollected Items:
Transit Items
Exchanges for Clearinghouse
Other Cash Items
Due From Branches or Head Office
Total Uncollected Items

12-31-51

Change from
12-31-51

157,606
170,000
25,549
353,155

175,261
150,000
25,018
350,279

- 17,655
20,000
+
531
+ 2,876

5,879

7,056

-

1,177

_
_

+
+
+

500
767
1

500
767
135

134

23,013
159,018
438,430
143,939
764,400

14,852
403,955
160,891
169,655
749,353

1
10,298

1
7,727

99,119
3,013
1,004

85,754
9,037
1,998

+ 13,365
- 6,024
994

-

-

-

8,161
244,937
+;277,539
- 25,716
+ 15,047

+

+

2,571

103,136

96,789

+

6,347

Bank Premises
Less Reserve
Bank Premises - Net

2,493
1,442
1,051

2,493
1,410
1,083

+
-

32
32

Miscellaneous Assets:
Fiscal Agency expense, reimbursable
Interest Accrued
Premium on Securities
Deferred Charges
All Other Assets
Total Miscellaneous Assets

135
4,414
367
47
15
4,978

90
3,392
487
54
13
4,036

+
+

45
1,022
120
7
2
942

1,244,300

1,216,458

Total Assets




-

+
+

27,842

-17-

MILLION DOLLARS




M ILLION

DOLLARS

COMPARATIVE STATEMENT OF L I A B I L I T I E S

MINNEAPOLIS AND HELENA BRANCH COMBINED
(Thousands of Dollars)
12-31-52

12-31-51

Change from
12-31-51

Liabilities:
Federal Reserve Notes in Circulation

650,889

632,029

+ 18,860

Deposits:
Member Bank - Reserve Accounts
U.S. Treasurer - General Account
Foreign
Nonmember Bank - Clearing Accounts
Officers' Checks
Due to Other F.R.Banks - Collected Funds
Other Deposits
Total Deposits

437,867
26,412
13,611
819
224
3,U7
482,080

464,389
8,309
13,013
1,561
124
2,749
490,145

- 26,522
+ 18,103
+
598
742
+
100
+
398
- 8,065

4,333
80,429
84,762

3,363
65,754
69,117

+
970
+ 14,675
+ 15,645

252
124
79
455

270
125
96
491

18
1
17
36

1,218,186

1,191,782

+ 26,404

5,719
15,131
1,073
4,191
26,114

5,363
14,063
1,073
4,177
24,676

1,244,300

1,216,458

Deferred Availability Items:
U.S.Treasurer - General Account
All Other
Total Deferred Availability Items
Miscellaneous Liabilities:
Discount on Securities
Sundry Items Payable
Suspended Credits
Total Miscellaneous Liabilities
Total Liabilities

Capital Accounts:
Capital Stock Paid in
Surplus Fund - Section 7
Surplus Fund - Section 13B
Reserve for Contingencies
Total Capital Accounts
Total Liabilities & Capital Accounts




-

+
+

356
1,068
-

+
+

14
1,438

+ 27,842

-19-

Probably the most significant development in the banking com­
munity last year was the growing importance of borrowing by member banks
from the Federal Reserve banks.

This form of extending credit by the

Reserve banks is much less inflationary than is the purchase of government
securities by the Reserve banks.
This is true because prudence requires that banks in debt to
the Federal reduce that debt at the earliest opportunity, either by liquidat­
ing assets or by utilizing the proceeds of a deposit increase for this
purpose.
Reserves provided by borrowing are, therefore, temporary in
character while reserves provided when government securities are purchased
by the Reserve banks are more likely to be regarded as permanent, and to be
used as the basis for extension of additional credit by the commercial
banks.
The growing importance of borrowing by the commercial banks has
been accompanied by a growth in the effectiveness of the discount rate as
an instrument of control.
FEDERAL RESERVE BANK OF MINNEAPOLIS
STATEMENT CHANGES
Although earnings on loans to member banks are still a relatively
unimportant part of total earnings at the Federal Reserve Bank of Minneapolis,
it is still possible to obtain an idea of how the volume of borrowing has
changed by comparing such earnings for 1952 with 1951.

The comparison shows

an increase of more than 50 per cent.




-20-

Most of the higher earnings which sent gross revenue at the
Minneapolis Federal Reserve Bank to the highest level in history came
from earnings on investments—U.S. government securities.

This increase

of almost 15 per cent came partly from larger holdings and partly from
higher yields.
The comparative balance sheet shows that investment in govern­
ment securities was up from $74-9.3 million at the end of 1951 to $764.4million at the end of 1952, an increase of $15.1 million.
Inspection of the other asset accounts shows that the larger
investment in governments accounted for the largest part of the increase
in total assets.
The national trend towards higher currency circulation is re­
flected on the liability side of this bank's statement.

Federal Reserve

notes outstanding at the end of 1952 amounted to $18.8 million more than a
year earlier.

The Christmas increase in demand for currency brought money

in circulation to an all time high for the nation.
Member bank reserve accounts show a decline of $26.5 million
from the year ago level but this decline is within the range of random
fluctuation and does not indicate any basic changes in the condition of
Ninth District member banks.
The net worth of the bank was enlarged during the year by reason
of the sale of more stock, the retention of earnings and the provision of
reserves for contingency.
There was no change in this bank's reserve ratio as the pro­
portionate addition to our gold certificate reserves was equal to the
proportionate addition to our note and deposit liabilities.



-21-

DEPARTMENTAL AND OTHER COMMEN TS

CHECK COLLECTION
The volume and dollar amount of checks handled during 1952 in
the Check Collection Department surpassed all records as reflected in the
following tables:

1952
City Checks
Country Checks
Govt. Checks
Paper
Card-Other Feds
Card-Our District
Returned Items
Postal Money Orders

Volume
(000 Gnitted)
No. of Items
Increase____
1951

Percent
Increase

12,728
49,006

11,584
42,605

1,144
6,401

9.8
15.0

1,171
2,925
9,234
657
10.097
85,818

1,151
2,492
7,084
627
4.711*
70,254

20
433
2,150
30
5,386
15,564

1.7
17.3
30.3
4.7
114.3
22.1

Dollar Amount
(000 Omitted)
1952.
City Checks
#12,967,251
8,226,278
Country Checks
Govt. Checks
Paper
1,139,903
Card-Other Feds
200,924
Card-Our District
809,065
296,570
Returned Items
Postal Money Orders
162,565
$23,802,556

mi

Dollar Amount
Increase

Percent
Increa:

$12,870,201
7,908,974

$ 97,050
317,304

.7
4.0

1,058,061
167,377
664,087
282,581
75,220*
$23,026,511

81,842
33,547
144,978
13,989

7.7
20.0
21.8
4.9
116.0
3.4

...87.ai£
^776,045

*This bank became paying agent for postal money orders effective July 1, 1951.
The previous highest single day's record (August 9, 1951) of
347,947 checks handled was surpassed on 48 different occasions during 1952.




-22-

The new single day's volume record of 444,583 items processed was established
on December 8, 1952.
New single day's volume records were also set during 1952 in
processing country and city checks of 227,456 on December 17 and 103,294
on November 17, respectively.
Due to the availability of a larger volume of items the two late
shifts totaling approximately 50 clerks sort and list from 100 thousand to
150 thousand checks each night, Monday through Friday.
The majority of all items are completely handled on the 80 proof
machines or tabulating equipment maintained in the department.
The total staff in the Check Collection Department was approxi­
mately the same at the close of 1952 as it was at the close of 1951.
Check Routing Symbol
During the year, we have continued to gain in our efforts toward
having the check routing symbol properly placed on cash items.
The officer and bank representatives assigned to promote the rout­
ing symbol directed their efforts mainly to problem banks.

Calls were made

at these banks and lists furnished them of their customers whose checks did
not carry the symbol.

On their bank calls, our Public Services men con­

tinued to call the matter to the attention of the par banks.
The State of South Dakota, Department of Public Instruction, was
considering revising its school accounting system and was approached with
recommendations to permit using a uniform and standard type of check with
the routing symbol.




-23-

As of December 1, 1952, a survey showed the average use of the
routing symbol in the Ninth District by states was as follows:

Michigan 83%|

Minnesota 90$; Montana 91%? North Dakota 90%; South Dakota 91%’ and Wis­
,
consin 86%.

Our Ninth District average of 90% (an increase of 10% for the

year) now equals the System average of 90% (an increase of 5% for the year).
Because the use of the check routing symbol has now reached the
point where it is workable in check collection operations, our efforts the
latter part of the year were directed to calling the attention of the banks
in our district to its use.
Check Standardization Program
A program was inaugurated at the beginning of 1952 for the pro­
motion of check uniformity and standardization.

It was found in changing

over to machine operation in our check collection department that poorly
designed checks and drafts and noncash items being handled as cash items
were responsible for considerable time loss in departmental operations.
Two senior representatives were assigned to promote this program.
During the year, some 4-00 direct calls were made on business, industrial
firms, printers, and banks.

When firms felt they could not properly redesign

their own checks, the work was done at our bank and the firm was sent photo­
static copies of suggested changes.

Talks were given and slides shown to

several organizations in the Twin Cities and Duluth.

Letters were written

to all member and par banks where their noncash items were being handled
as cash items through the check collection department asking for their
assistance in eliminating this noncash form of customers' drafts.




Our

Public Services men, on their bank calls, followed through on these letters
with further discussion as to the need in correcting this situation.
Checks of national corporations operating in this district were
scrutinized and if a poorly designed check was being used the Federal Reserve
Bank of the district in which the corporation was located was asked to con­
sult with them with the idea of making a change in the form of their check.
Legislation was initiated through the Bankers Association of
Minnesota, North and South Dakota, for presentation to the 1953 legislature
for the substitution of checks for warrants in disbursing municipal sub­
divisions funds in those states.

Wisconsin passed similar legislation in

1951 and Michigan and Montana are on a pending basis at present.

CREDIT CONTROL
Regulation W
This regulation, which had been reinstituted in September 1950,
was suspended on May 7, 1952.

During the life of the regulation, repre­

sentatives from our Credit Control Department visited 12,362 concerns sub­
ject to the regulation.

Less than i& of those visited were found to have

violated the regulation in such a manner as to warrant revisits or compliance
conferences at our bank.

At the suspension of the regulation nine men were

devoting their entire time to investigations of concerns operating within
the scope of the regulation.




-25-

Regulation X
This regulation, applicable to real estate credit, was instituted
in October 1950 and suspended effective September 16 , 1952, under statu­
tory provisions.

During the life of the regulation our representatives

called on 387 concerns subject to the regulation
compliance with its terms.

and found substantial

Activity during 1952 to the end of the regula­

tion covered visits to 208 real estate financing organizations, less than
5% of which had transactions in violation of its terms.

Nearly all of

such "violations" related to technical rather than substantive matters.

At

the time of the suspension of the regulation six full time investigators
were engaged in investigative duties.

These men were either absorbed in

other departments or resigned to accept employment elsewhere.

CURRENCY AND COIN
The volume of work involved in the various operations of the
Currency and Coin Department in 1952 ranges from slightly above to sub­
stantially greater, in some cases, than the record volume of 1951.
During 1952 wrapped coin showed an increase of almost 9% in
the number of pieces wrapped.

Two new automatic coin counting and wrapping

machines have been ordered and are expected to be received early in 1953.
These machines will eliminate the hand wrapping operation and are expected
to give us a substantial increase in the potential production of wrapped
coin, particularly in nickels and cents.




-26-

Four new currency sorting machines were received in late 1952.
A rearrangement of the departmental space was made necessary by the acqui­
sition of the new sorting machines and by the removal of the elevator which
formerly linked the Currency Department with the bank floor.

The space

formerly occupied by the elevator is now being used for a new teller's
cage, and the partitions which formed another cage have been removed so
that there will be sufficient room for the new sorting machines.
Our currency sorters discovered 82 counterfeits ostensibly worth
§
>
1,055 during the year as compared with 126 picked up in 1951.




-27-

Outgoing Shipments
for Account of Member Banks
1951

1952
Currency paid out
Currency shipped to Helena Branch
and for other F.R. Banks
Coin paid out

Number
20,926

Amount
$359,931,000

Number
21,831

Amount
$356,332,500

664
12*022
36,662

48.764.000
12.032.000
$420,727,000

509
14.496
36,836

49,583,500
10 .946.000
$416 ,862,000

Incoming Shipments
for Account of Member Banks
1952
Number
22,041
-2*212
25,954

Currency
Coin

1951
Number
22,816
-4.i220
27,106

Amount
$397,286,000
9,399,000
$406,685,000

Amount
$383,495,000
9.009.000
$392,504,000

Number and Amount of Fieces Handled
Currency

Bills received and counted
Bills rehandled
Hand verification of bills

.1252.
Number
Amount
$436,089,000
65,883,703
77,483,470
6,367,024
21.493.369
251.707.250
5*765,279,720
93,744,096

,

Number

1951

64 983,663

5 ,620,427
24.041.991
94,646,081

Amount

$ ,
420 409,560
67,751,600
287.758.790
$775,919,950

Coin

Coins received and counted
Coins rehandled
Coins wrapped




,

1952 _
Number
Amount
102 222,422
$ 8,887,532
3,011,385
471,775
___ AJ£2*Z25
$ 13, 8a , 582
160,849,537

Number
104,789,880

,

3 610,122

51.186.000
159,586,002

1251-

Amount
8,823,987
523,378
4.309.400
13,656,765

-23-

Amount of Coin Received from
U. S. Mints
1952
$2,957,000

1951
$2,310,200

Number of Unfit Bills Forwarded to Treasurer
of the United States for Redemption

mz

mi

33 ,342,863

26 ,182,316

Return of Federal Reserve Notes
to Bank of Issue
Fit-for-use Federal Reserve Notes
returned to other F. R. banks
Our fit-for-use Federal Reserve
Notes received from other F. R.
banks




m i

1951

$52,321,300

$37,907,000

$42,474,000

^40,485,750

-29-

DISCOUNT AND CREDIT
A total of 54 banks in Head Office territory borrowed an aggregate
of $1,949,055,000 during 1952, all of which was secured by United States
government obligations.
Twin City banks.
to 41 banks.

All but $72,205,000 of this amount was borrowed by

Advances on governments in 1951 aggregated $1,715,790,000

Seven banks in Montana borrowed $65,275,000 through the Helena

Branch in 1952, $40,085,000 more than in 1951«
There were no borrowings made under Section 10b in 1952.

One non­

member bank borrowed $500,000 secured by United States government obligations.
Such loans are authorized under the last paragraph of Section 13 of the Fed­
eral Reserve Act and carry a rate 1% above the discount rate.
Our bank's participation in foreign loans on gold during the year
totaled $1,976,000.

At year's end there was $767,000.

Only five applications for industrial loans under Section 13b of
the Federal Reserve Act were received during the year.
aggregated $507,000.

These applications

Four of the applications were declined and one was

approved and disbursed.

No applications were pending at the year's end.

An industrial loan disbursement for $56,250 was made.

The total

amount of industrial advances outstanding on our bank's books on December 31,
1952, was $134>883.34*

These funds were being utilized by (l) a wholesale

and retail grocery business, (2 ) a paint manufacturer, (3) a creamery,
(4 ) a builder's hardware and appliance dealer, (5) a soft water service
company, and (6) a feed manufacturer.




-30-

In 1952, advances amounting to $13 ,064.,741.27 were made by
financing institutions under Regulation V.

$9,318,243.94 advanced was

guaranteed by the Department of the Army; $377,000.00 by the Department
of the Navy; and $3*369,497.33 by the Department of the Air Force.
As of December 31, 1952, the amount of loans outstanding
guaranteed by the Department of the Army was $13,527,073.41, portion
guaranteed $>11,070,403.79J the Department of the Air Force, $7,437,326.96,
portion guaranteed $6,693,594.31; and the Department of the Navy
$418,710.59, portion guaranteed $349,477.41.
Twenty applications for guaranteed loans totaling $12,393,450
were received during 1952 and one application for $125,000 was pending
at the beginning of the year.

Ten applications were authorized, five

were disapproved, five were withdrawn and one is under consideration.
The total amount of guarantee agreements executed in 1952 was
$3 ,430 ,000 .
The approvals of applications for guaranteed loans ranged from
$15,000 to $800,000, all of which are in the form of revolving credits.

DUPLICATING
During 1952, the department turned out 5.9 million pieces of
duplicated matter on 5,516 separate production runs.

This volume repre­

sents an approximate decrease of 8% compared with total production for 1951
and is largely due to the suspension of Credit Controls, Regulation W on




-31-

May 7 and Regulation X on September 15.
four different machines, namely:
and the multilith.

The total is a combined output of

the uitto, the mimeograph, the multigraph

The addressograph section of the department addressed

a daily average of approximately 4>600 envelopes and 4,500 miscellaneous
forms.
Photostatic reproduction of various documents declined slightly
for the year.

We v.*ere reimbursed for the cost of about 50% of our 1952

photostat work.

EXAMINATION
At the close of the year there were 4.76 state and national member
banks in the Ninth District.

The number of national banks decreased one,

and the number of state member banks increased one.

The banks are geographi­

cally distributed as follows:
National
Banks
Michigan
Minnesota
Montana
North Dakota
South Dakota
Wisconsin

State
Banks

Total

26
178
38
40
35
27
3U

14
28
45
2
28
JLi
132

40
206
83
42
63
_A2
476

A regular examination of each of the state member banks was made
except that the Rapid City Trust Company, Rapid City, South Dakota, which
opened for business September 15, 1952, was not examined, and one Montana
state member bank was examined twice.




-32-

At the close of the year, eleven state member banks were exercising
trust powers.
powers.

Ten other state member banks are not exercising their trust

Sixty-five national banks held permits to exercise full or limited

trust powers.
Two applications for membership in the Federal Reserve System were
received from state banks during the year.
During the year we received 687 examination reports from the Chief
National Bank Examiner's office at a cost of $6,870.

In addition, six

sep­

arate reports of examination of trust departments were received at a cost
of $30 .
The number of reports of examination received from the various
state banking departments in this district of state member banks examined
independently by them was as follows:
Minnesota
South Dakota
Wisconsin
North Dakota

27
4
3
2

Four calls for a report of condition of each member bank were issued,
and, in addition, all member banks submitted semiannual reports of earnings
and dividends.




-33-

FISCAL AGENCY
During the year 1952s the Treasury Department each week made the
usual offering of Treasury Bills, and in addition two special offerings of
Treasury Bills labeled "Tax Anticipation Series".

An additional issue of

the 2 3/4$ Treasury Bonds, Investment Series B-1975-80, was also offered
for cash and in exchange for any of the following four outstanding restricted
Treasury Bonds:
1.

2 \/2% Bonds of 1965-70, dated Feb. 1, 1944, due March 15, 1970.

2.

2 1/256 Bonds of 1966-71, dated Dec. 1, 1944, due March 15, 1971.

3.

2 1/2$ Bonds of 1967-72, dated June 1, 1945, due June 15, 1972.

4.

2 1/2% Bonds of 1967-72, dated Nor. 15, 1945, due Dec. 15, 1972.

Commercial banks could only subscribe to this offering to the extent that they
presented restricted bonds of the eligible issues acquired before December 31,
1945, in payment of 75 percent of their subscription and cash for the remain­
ing 25 percent.

We received and allotted 34 applications, totaling

$11,568,000 for this offering.

Six of these applications were for the account

of banks and 28 for the account of others; 08,450,000 were exchange subscrip­
tions and $3,118,000 were for cash,

Nationwide, exchange subscriptions

totaling $1,307,359,500 and cash subscriptions totaling $450,399,500 were
received.
Also offered for cash were 2 3/8$ Treasury Bonds of 1958.

Com­

mercial banks could subscribe for this issue for their own account to an
amount not exceeding the combined capital, surplus and undivided profits,
or 5 percent of the total deposits as of December 31, 1951, whichever was
greater.

We received 600 applications totaling $263,922,500 for this issue,

of which $107,547,000 was allotted.



These appl ica.tions represented 726

-34-

subscribers - 531 being banks.

Nationwide, subscriptions totaling $11,693,-

351,000 were received and $4,24.8,4.37,500 allotted.
There were six exchange offerings during the year, as follows:
1.

2 3/8$ Treasury Bonds of 1957-59 for 2 l/2$ Treasury Bonds of
1952-54.

2.

1 7/8$ Certificates of Indebtedness, Series A-1953, for 1 7/8$
Certificates of Indebtedness, Series A-1952.

3.

1 7/8$ Certificates of Indebtedness, Series B-1953, for 1 7/8$
Certificates of Indebtedness, Series B-1952.

4.

2$ Certificates of Indebtedness, Series C-1953 for 1 7/8$
Certificates of Indebtedness, Series C-1952, and 1 7/8$
Certificates of Indebtedness, Series D-1952.

5.

2 1/8$ Treasury Notes, Series A-1953, for 1 7/8$ Certificates
of Indebtedness, Series E-1952.

6.

An additional issue of 2$ Certificates of Indebtedness, Series
C-1953, for 1 7/8$ Certificates of Indebtedness, Series F-1952.

We received 1,512 applications, totaling $445,629,000 for these exchange
offerings, which were allotted in full.

These applications represented

3,904 subscriptions, of which 2,981 were for the account of banks.
During the year, we received 4,661 tenders for the weekly Treasury
Bills, totaling $706,036,000, and $635,938,000 were accepted.
represented 5,276 subscribers.

These tenders

In 1951, we received 2,665 tenders, totaling

$363,505,000, and $350,377,000 were accepted.

The average equivalent rate of

discount on Treasury Bills increased from 1.883 percent for the Bills dated
January 3, 1952, to 2.228 percent for the Bills dated December 26, 1952.
On October 3, 1952, tenders were received for bids to an issue of
161-day Treasury Bills dated October 8, 1952, due March 18, 1953.
were labeled "Tax Anticipation Series".

These Bills

We received 126 tenders, totaling

$82,995,000, and $75,595,000 were accepted.

These Bills may be used to pay

income and profits taxes due March 15, 1953.




On November 13, 1952, tenders were received for bids to an issue
-35-

of 210-day Treasury Bills, dated November 21, 1952, due June 19, 1953, also
labeled "Tax Anticipation Series".

We received 111 tenders, totaling

$101,765,000, and $56,034,000 were accepted.

These Bills may be used to pay

income and profits taxes due on June 15, 1953.
Banks that were qualified as "Special Depositaries for Public
Honeys" were permitted to make payment for accepted tenders for these Tax
Anticipation Treasury Bills by deposit in their Treasury Tax and Loan Account
On April 29, 1952, the Treasury Department announced a number of
changes in United States Savings Bonds.




1.

Briefly, the changes are as follows:

The issuance of a new design Series E bond, effective as of
May 1, 1952, which matures nine years and eight months after
the issue date.

The new "E" bonds yield a higher rate of

return, if redeemed during the early years, than the old bonds.
They also increase in redemption value at the end of six months
after the issue date; whereas "E" bonds issued prior to May 1,
1952, do not increase in redemption value until one year after
the issue date.

The over-all interest rate was also increased

from 2.9 percent to 3 percent compounded semi-annually, by
shortening the term of the bonds from ten years to nine years
and eight months.
2.

The interest rate on the "E" bonds, during the extension period,
was also raised for all such bonds that mature after May 1, 1952,
so that the return will be 3 percent compounded semi-annually on
the issue price, if such bonds are retained for an additional ten
years after the original maturity date.

The new rates during the

extension period do not apply to the "E" bonds which matured
before May 1, 1952.
3.

The annual limitation on the purchase of Series E bonds was also




raised from $10,000 (maturity value) to $20,000 (maturity value).
Since the new design "E" bonds were not physically available on
May 1, 1952, the stock of the old design bonds was used until the
new design bonds were available.

Such old style bonds bearing

issue dates of May 1, 1952, or thereafter, nevertheless, entitled
the owner to the benefits of the revised terms.

The new design

Series E bonds became available early in August 1952.

On August 8,

we began to ship the new bonds to the issuing agents in our
district with instructions to return the unissued stock of the
old style "E" bonds.

By the end of October 1952, the agents in

our district had accounted for and returned all of the old design
Series E bonds, amounting to 175,569 pieces, totaling $34,990,275
(maturity value).

It is interesting to note that only two issuing

agents in this district were unable to account for all bonds con­
signed to them.

One agent could not account for one bond at $25

and another could not account for two bonds at $25 and two bonds
at $50.

Under Treasury Department provisions, these agents re­

imbursed the Department for the issue price of these five un­
accounted for bonds.

The unissued "E" bond stock has been

audited by us and sorted in serial number order by denomina­
tions.

This stock will be retained by us and will be used for

reissue cases involving bonds bearing issue dates prior to May 1,
1952,
4.

The Treasury Department discontinued the sale of Series F and G
United States Savings Bonds as of the close of business April 30,
1952, and offered in their place Series J and K bonds.

The Series J

bond, which replaces the "F" bond, will yield 2,76 percent interest

-37-

if held to maturity, which is twelve years after the issue date;
whereas the "F" bonds only yielded 2.53 percent if held twelve
years.

The redemption values on the new bonds if redeemed prior

to maturity are also higher.
Series G bonds.

The Series K bonds replaced the

The "K" bond is a current income bond and it will

yield 2.76 percent if held to maturity, twelve years after the
issue date; whereas, the "G" bond only yields 2 1/2 percent if
held twelve years.

This bond also has the same par payment pro­

vision as the "G" bond.

The amount of bonds of Series J or

Series K, or the combined aggregate amount of bonds of both series
originally issued during any one calendar year to any one owner
that may be held by that owner at any one time, including those
registered in the name of an individual and another person as co­
owner, is limited to $200,000 (issue price).

Bonds of Series K

issued in exchange for matured bonds of Series E are not included
in computing the owner's holdings for the purpose of applying the
limitation on holdings.

Series J and K United States Savings Bonds

may be registered in the names of individuals as well as organiza­
tions,

However, up to the present time, commercial banks have not

been permitted to subscribe for either Series J or K United States
Savings Bonds.
5.




As of June 1, 1952, a new current income bond, known as Series H,
also became available.

This bond matures nine years and eight

months after the issue date, and will yield 3 percent if held to
maturity.

They are sold at par and the interest is paid by check

semi-annually on a graduated scale of rates.

The bond is redeem­

able at par at any time six months after the issue date as of the

-38-

first day of the month on one full calendar month's notice.

It

may only be registered in the names of individuals and the annual
purchase limitation is $20,000 (maturity value).
There were 1,4-09 qualified issuing agents for Series E savings bonds
in this district as of December 31, 1952, which is the same net number of
qualified issuing agents as of December 31, 1951.

These agents, during 1952,

sent us 21,453 sales reports covering 991,908 pieces of Series E bonds, total­
ing $95,457,355 (issue price) as compared with 931,016 pieces aggregating
$93,287,829 (issue price) issued during 1951.

During the year 1952, we made

9,442 shipments of unissued stock of Series E bonds to issuing agents in our
district, involving 1,187,165 pieces as compared with 980,255 pieces shipped in
1951.
United States Savings Bonds of Series E, F, G, H, J and K amounting
to $48,684,487 (issue price), involving 214,956 applications and 244,987 pieces,
were issued by our bank during 1952.

This compares with $41,285,375 (issue

price), involving 227,638 pieces of Series E, F and G issued in 1951.
On December 31, 1952, 1,251 banks with 110 branches and 38 other
organizations in our district were qualified to act as paying agents for Series
A through E savings bonds and Armed Forces Leave Bonds.

The daily average of

all savings bonds paid by our bank and the paying agents in our district during
1952 was 8,101 pieces as compared with a daily average of 8,573 in 1951.
Paying agents in our district were reimbursed for paying savings
bonds and Armed Forces Leave Bonds during the first three quarters in 1952 in
the amount of $205,821 for 1,513,123 pieces as compared with $227,922.20 for
1,703,698 pieces during the first three quarters of 1951.
We received a monthly average of 1,597 pieces of savings bonds for
safekeeping during the year 1952 as compared with 1,166 pieces per month during



-39-

the year 1951.

Savings bonds released from safekeeping during 1952 averaged

2,083 pieces monthly as compared with 2,342 per month during 1951.

As of

December 31, 1952, we were holding in safekeeping for individuals, fiduciaries
and organizations other than banks 229,837 savings bonds as compared with 235,666
bonds held on December 31, 1951.
During the year 1952, we reissued for all purposes 133,162 savings
bonds with a maturity value of $27,407,550 as compared with 109,018 pieces,
totaling $22,008,895 (maturity value) reissued in 1951.
The total public debt as of December 31, 1952, was $267,445,125,000,
as compared with $259,445,000,000 on December 31, 1951.
In this district, 1,171 banks are now qualified as "Depositaries for
Public Moneys" and 988 of

them had active Treasury Tax and Loan Accounts.

As

of December 31, 1952, the total deposits in the Treasury Tax and Loan Accounts
were $107,475,150.28.

The aggregate of all amounts deposited in the accounts

during 1952 were $982,323,888.49 as compared with $294,648,656.51 for 1951.
As it did last year, the Treasury Department permitted Special
Depositaries to accept for deposit in their Treasury Tax and Loan Accounts,
special drafts prepared by us representing checks of $10,000 or over drawn
on such depositaries in payment of quarterly installments of income and excess
profits taxes remitted to Directors of Internal Revenue.

This provision was

made effective for the following periods:
March 1, 1952 through April 5, 1952
June 2, 1952 through July 3, 1952
Sept. 1, 1952 through Oct. 3, 1952
Dec. 1, 1952 through Jan. 5, 1953
For the tax payment period December 1, 1952, through January 5, 1953, only 50
percent of the amount of such checks could be deposited in the Treasury Tax



-40-

and Loan Account by a Special Depositary.
On December 31, 1952, 680 banks in this district were qualified to
act as Depositaries for Withheld Income Taxes, Federal Insurance Contribution
Act Taxes and Railroad Retirement Taxes, and as such could accept deposits of
those taxes from employers, and deposit the funds in their Treasury Tax and
Loan Accounts.

During the year, we received from qualified Depositaries and

direct from employers 186,278 Depositary Receipts for withheld tax payments,
totaling '$360,352,296.35.

In addition, we also received from qualified De­

positaries and direct from employers 507 Depositary Receipts for $23,252,457.90,
representing Railroad Retirement Taxes.

In 1951,634 banks were qualified as

Depositaries for Federal Taxes and we received a total of 155,710 Depositary
Receipts for such taxes, amounting to $295,978,315.96.
The Fiscal Agency now occupies space on the Bank Floor, the Green
Room in the Subbasement and the Annex.

On December 31, 1952, there were 106

employees in the Fiscal Agency Division, as compared with 112 on December 31,
1951.
Commodity Credit Corporation
This year, in our district, new agreements with the Production
Marketing Administration were executed by 846 lending agencies.
forty of these agencies also qualified as servicing agents.

Two hundred

Ninety-one percent

of the servicing agencies are banks.
The number of items handled as cash items this year was approximately
57 thousand, as compared with 90 thousand last year.

The dollar volume was

$116.5 million as compared with $147 million last year.

We paid approximately

32 thousand sight drafts drawn on the Commodity Credit Corporation by the
Production Marketing Administration State Committees, of which there are 337
in this district, as compared with 41 thousand paid in 1951.



These drafts
-41-

totaled $25.5 million as compared with $22.5 million in 1951.
Approximately 3,200 sight drafts, drawn on the Commodity Credit
Corporation and payable through the Federal Reserve bank, were paid by us in
1952.

These drafts totaled $ 64. million.

In 1951 we paid 2,100 such drafts,

totaling approximately $60 million.
On behalf of the Minneapolis Office of the Commodity Credit Corpo­
ration, during the year we issued 15 thousand checks drawn on the Treasurer
of the United States, totaling approximately $221 million as compared with
20 thousand checks for $176 million in 1951.
There were two full-time employees in this division as of Decem­
ber 31, 1952.

NONCASH COLLECTION
During 1952 this department handled 885,674. grain drafts totaling
$787,002,803.28.

This was a decrease of 37,110 in the

number

of items handled

and a decrease in dollar value of $76 million under that of 1951.
There was an increase of 3,338 items in city collections and a de­
crease of 584. items in country collections compared with 1951.

The dollar

value of city collections increased $10,188,000 and the dollar value of
country items increased $1,4-99,000.
Coupon and country security collections showed a decrease of 61,599
items and a dollar value decrease of $967 thousand.
Our member banks forwarded 2,832 direct-sent collections to other
Federal Reserve banks as compared to 2,539 in 1951.

The dollar value of these

collections totaled $23 million for 1952 as compared to $25 million for 1951.




Exclusive of direct-sent collections, this department handled during

-4-2-

1952 a total of 1,169,4-86 items with a dollar value of $914 million.

This is

a decrease of 95,955 in number of items handled and in dollar value, a decrease
of $66 million.
During the year we redeemed 307,123 Government coupons aggregating
$17 million, which is a decrease of 30,000 items and $12 million as compared
with 1951.

We also redeemed 12,092 Governmental agency coupons amounting to

$588,000 during 1952, as compared to 11,810 coupons totaling $436,000 in 1951.

PERSONNEL
During the early part of 1952, after discussions with our Placement
Director friends and a survey of current literature concerning employment, it
appeared that there would be an extremely tight labor market during the year.
Several reasons were in evidence.
Census figures show that while demand for employment of young women
between the ages of 18 and 35 has been increasing, the supply has dropped off
since 1940.

The latter was caused by the low birth rate during the depression

years, sharp increases in early marriage, and a rising birth rate in the post
war years.

Census figures also show a gradual increase in the number of girls

attaining the age of 18 after 1952, but not before I960 will the number of 18
and 19 year-olds exceed the 1940 level.
Firms employing clerical women have experienced increased difficulty
because of the higher rates paid by production type industries.

Many young

women who in the past would have taken clerical positions have preferred a
higher paying factory job since they plan to be a part of the labor force
only for a relatively short period of time.




-43-

Armed with this information and anticipating difficulty in filling
orders for new employees, we discussed with department managers the need for
longer term planning concerning operating personnel and the importance of
ordering new employees well in advance.

By so doing, we finished the year

almost 100$ staffed, but it is already evident that we are starting the new
year in an extremely tight labor market.
During the past year we found it most difficult to fill jobs re­
quiring special skills, such as stenographers.

We have continued our

practice of placing older women on jobs where pressure deadlines are not re­
quired.

The number of night shift employees was also increased to tap a

source of labor that is not available for day work.

On December 31, 1952, we

had 24 women IBM operators working on the night shift.
On December 31, 1952, the head office staff consisted of 638 em­
ployees, 4-06 women and 232 men.
separations totaled 328.

Accessions for the year totaled 308 and

One hundred and five employees were hired during

June for the largest June placement since 194-3.

This large number, consist­

ing mostly of junior clerical employees, was necessary because the staff had
decreased during the last two months of 1951 and the first five months of 1952.
The staff fluctuated from a low of 624- on May 21 to a high of 694on June 26.

Since 194-7

it has also been necessary to build up the staff for

vacation relief because the local high schools now have only one graduating
class each year and that during the spring.
At the end of the year, 213 employees were members of the local
chapter of the American Institute of Banking.
and 115 women.

Of this number, 98 were men

Sixty employees enrolled in 13 classes in order to further

their education and better prepare themselves for their work.

An employee of

the bank is president of the AIB, and many others were appointed to work on



-44-

various committees.
The contract with the Minda Anderson Lunchroom was terminated in
February, and a new agreement was made with Nationwide Food Service, Inc.,
which assumed management of the cafeteria.
During the year, 116 suggestions were submitted and 32 suggestions
were approved with awards totaling 0192 .
During January, the Welfare Division, in conjunction with the Federal
Reserve Club, made arrangements for the Red Cross Mobile Blood Unit to visit
the bank.

One hundred and sixty employees volunteered to give, and 105 were

accepted and gave donations of blood to be used for Armed Forces personnel.
The Welfare Division also made arrangements to have the Mobile X-ray Unit of
the Hennepin County Tuberculosis Association come to the bank to give free
X-rays to employees and their dependents or relatives.
ployees were X-rayed.

Over 15% of the em­

Sixty-eight relatives or dependents also were X-rayed

and were taken on tours of the bank and served refreshments in the employees'
cafeteria if they so wished.
Eleven employees completed a 24-week instructors' course in first
aid which was taught by a representative from the local Red Cross office.

A

number of women employees attended a class in swimming which was taught by a
local Red Cross instructor.
We have continued the policy of offering polio insurance to
interested employees through the Connecticut Casualty Company.
38 single and 59 family applications were made.

A total of

Our policy carried with the

Connecticut General Life Insurance Company covering hospitalization and surgi­
cal benefits has continued to give assistance to employees in case of illness.
The following tabulation shows the costs incurred by employees for surgery




-45-

and hospitalization and the portions thereof paid by the insurance company:
Services

Claims

Surgical
Hospital

138
128
2^6

Total Cost
$17,232.30
8.802.20
$26,034.50

Amount Recovered

% of Recovery

$14,406.28
6.295.00
$20,701.28

84
71
77.5

In September the position of Job Analyst was created in the depart­
ment.

An employee who has worked in several of the large departments of the

bank over a period of many years was selected to conduct a review of all
active jobs in order to determine whether the description of the duties on
file in the Personnel Department adequately describes the tasks performed by
the individual assigned to each job.

Information for the review is obtained

by interview with department heads and supervisors.

Minor or inconsequential

job changes are made without re-evaluation, but if it is felt that major
changes have occurred, the Job Analyst presents the job to the Employee
Evaluation Committee, consisting of three members of the Personnel Department,
for preliminary evaluation.

The job is then evaluated by a Junior Officer

Committee composed of three members, and final evaluation is made by the
Personnel Committee after giving consideration to evaluations by the Employee
and Junior Officer Committees.

The Job Analyst is also responsible for the

writeup of descriptions of new jobs as they occur.

It is believed a constant

review will help us insure a fair and just classification of jobs in all de­
partments based on specific job requirements.
The Personnel Development Program continued its long-range plan aimed
at broadening the bank experience of our employees and developing manpower for
promotions within the bank.

In the fall a Personnel Development Committee was

formed, consisting of two officers, two department managers from large de­
partments, and a representative from the Personnel Department.




-46—

PUNNING
As a result of the changes in postal rates and the size and weight
limitations which became effective January 1, 1952, a complete review of our
methods of forwarding checks, currency, coin, securities, etc., was made in
order to minimize the resulting increase in our postage expenses and to
assure that our shipments would comply with the new regulations.

The regula­

tions issued by the Post Office Department permit the Reserve banks to exceed
the reduced weight limitations under certain circumstances provided that such
shipments are "pouched" and we are using this authority extensively on ship­
ments of coin, redeemed currency and United States Savings Bonds, etc.
As we assume the shipping charges on currency from member banks, we
advised all member banks of the new postal rates and regulations and requested
their cooperation in minimizing such expense by reducing the number of ship­
ments forwarded by including deposits of fit and unfit currency in the same
shipments and by increasing the size of shipments where more than one ship­
ment was being forwarded to us on the same day.

Test checks of all shipments

received were made for a period of months to correct misunderstandings of the
new postal rates and regulations by member banks and postmasters and to obtain
the cooperation of the banks in effecting feasible savings in postage expense.
A survey of all phases of Check Collection Department operations
was completed early in the year and assistance given to the Check Collection
Department in the installation of the recommended changes which were adopted.
Arrangements were made with a number of member banks in this district to
forward checks to us by air mail or air express so as to permit receipt of the
items for handling by our night force.




1Te reimburse such banks for the addi­

-47-

tional shipping charges incurred in excess of the cost of forwarding such de­
posits by first class mail or railway express.

As a result of the absorption

of the activities of the Chicago and Seattle offices of the Veterans Admini­
stration by the Fort Snelling Veterans Administration office, there was a
substantial increase in the volume of items received from that office.

The

Fort Snelling office previously deposited items at approximately 10:30 A.M.
daily.

Arrangements were made to obtain a portion of these items for handling

by our night force after the consolidation and effective January 2, 1953,
checks deposited as late as 5:00 P.M. permit the handling of all such items
by our night force.
A Security Files Program, under the supervision of the Planning De­
partment has been in continuous operation during the year.

Current informa­

tion is being maintained of our essential records in space in the basement of
the Wayzata State Bank, Wayzata, Minnesota.
Several surveys were made during the year of facilities for the
storage of emergency currency reserves.

A plan for converting space in two

grilles in our main vault formerly used for the storage of coin, for the
storage of currency or coin on a basis which will permit joint audit and
officers control of individual compartments was adopted and the necessary steel
for this installation has been ordered and will be installed shortly.
An exhaustive study is being made of our previous, present and
estimated future space requirements with a view to determining the amount of
additional space which should be provided for in any ultimately adopted build­
ing plans.
The Planning Department considers employees' suggestions and makes
recommendations to the Personnel Committee for the acceptance or rejection of
such suggestions and in certain instances alternate methods of accomplishing



-48-

the objectives of the suggester.
During the year several changes were made in the locations of de­
partments in the bank and Syndicate building and the Planning Department
assisted in making such moves by furnishing suggested office layouts for
efficient space utilization, flow of work, etc.
The Planning Department made studies of various operations in a
number of departments and recommended changes ia forms, equipment used, in­
formation recorded, etc., to improve operations.
Several operating letters and supplements were revised and dis­
tributed to all member banks during the year.
A considerable amount of research for System committees was con­
ducted during the year.

Included in these surveys were several question­

naires on check collection, currency and coin and leased wire activities.
Our first class mail and valuable registered mail schedules were
reviewed during the year and our records brought up to date.

The coopera­

tion of the Railway Mail Service was solicited in order to obtain improved
service to a number of points and information furnished on the necessity
for retaining the service in effect in several instances where reductions in
service were under consideration.

PROTECTION
Four guards left the employ of the bank during 1952, and one of
these guards was rehired.
cies.

Three new guards were hired to fill these vacan­

As of December 31, 1952, the personnel of the protection department

was as follows:




-4-9-

1 Superintendent
U Sergeants
24 Guards (one acting as chauffeur)
Ammunition for all weapons was renewed, and old ammunition was
fired on the range by guards in their weekly practices.
All guards were given training on all arms, as well as their side
arms.
All alarms were tested monthly by the Superintendent of Protection.
All inside alarms were tested weekly by the sergeant in charge.
The information clerk issued 2,503 passes to outsiders who wished
to visit upper floors of the bank — 1,733 work cards were issued to outside
workmen, canteen employees, etc.
At the request of the Bond Department, 575 guard escorts (4-76
singles and 99 doubles) were furnished.
One hundred and five employees were admitted by memorandum and
after-hour passes turned in to the guard office after hours.
All applicants for employment were investigated at the Identifi­
cation Bureau of the Minneapolis Police Department by the Superintendent
of Protection.

PUBLIC SERVICES
A summary of the Public Services activities of our bank for 1952 is
the best medium for comparison of our work with the objectives of a bank and
public relations program formulated by the subcommittee on bank and public
relations for the System.

The objectives agreed on by that committee axe as

follows:



-50-

I.

II.

To bring about public understanding of the System's
statutory purposes, responsibilities, and ooerations,
and of their part in the economy of the United States.
To provide opportunity for mutual exchange of ideas
among the Federal Reserve System, bankers, and the
public at large, in order:
(a)
(b)

To keep bankers and the general public
informed of developments, policies,
regulations, and operations of the
System and each Federal Reserve Bank;

(c)

III.

To keep the System currently informed
of economic and business developments;

To keep the System aware of public
attitudes toward the System's policies
and regulations and toward individual
Reserve Bank operations and practices.

To provide media for study of banking problems and
techniques, and economic developments, with a view
toward improvements that will contribute to the
strength of the banking system as a whole.

The broad objectives are not expected to be achieved in any one
year, nor can a description of any one activity of an individual Reserve Bank
be expected to coincide exactly with any one of the objectives.

For purposes

of comparison of our program with the broad objectives, we will take each
objective and list below it the activities of our bank which relate to it.
Relative to Objective No. I, TO BRING ABOUT PUBLIC UNDERSTANDING
OF THE SYSTEM'S STATUTORY PURPOSES, RESPONSIBILITIES, AND OPERATION, AND OF
THEIR PART IN THE ECONOMY OF THE UNITED STATES, our bank engaged in the
following:




I.

In the fall of 1952, we introduced a new type of meeting to the
Ninth District.

Now known as the Assembly, this meeting held

on November 24. and 25 included the directors as well as the
senior officers of our member banks.

The announced program

theme, WHAT'S AHEAD FOR YOU AND YOUR BANK, sought to interest
-51-




particularly those directors of our member banks who play
an active part in the business life of their communities
rather than in the banks.

The program included tours of

the Federal Reserve Bank, talks devoted largely to Federal
Reserve policy by Governor R. M. Evans, President Powell,
and Director of Research, J. M. Peterson.

Credit problems

and other bank matters were discussed by qualified speakers.
The number of directors included in the audience total of
562 was very encouraging. Unsolicited comment received
indicates that future meetings of this type will attract
an even greater number of directors.

The continuing effort

to better acquaint the directors' group with the Reserve
Bank and its direct connection with the local bank and the
economic welfare of the community should certainly qualify
this activity under Objective No. 1.
On May 3 our bank sponsored the fourth in a series of Money
and Banking Workshops.

As in previous years, this meeting

was open to the instructors of economics and money and
banking from Ninth District colleges.

Continuing the theme

originally announced in 1949, this meeting offered its
audience discussions on monetary and economic subjects
which could be used as supplementary material in teaching.
The 1952 major topic was inflation and the role of the Re­
serve Bank was discussed in detail.

Teachers play an im­

portant part in the development of public understanding.
Our Workshop attempts to broaden the source of information
of the teachers.




III.

The Federal Reserve Bank of Minneapolis' widest contact with
the general public continues to be our movie, THE FEDERAL
RESERVE BANK AND YOU, shown to school classes and other
interested groups. During 1952 it was shown to Ninth
District audiences totaling 4-2,267 persons bringing its
cumulative Ninth District audience total (since its intro­
duction in 1950) to 195,470.

In addition, our bank circulated

the movie, THE FEDERAL RESERVE SYSTEM, produced by the Encyclo­
pedia Brittanica.

This film was shown to audiences totaling

5,616 persons.
IV.

Our publication, YOUR MONEY AND THE FEDERAL RESERVE SYSTEM,
continued to be very popular with teachers in the eighth grade
and junior high schools. During the year, we filled 779 re­
quests for 8,135 copies.

These requests came from all parts

of the country.
V.

Another direct contact of our bank with the public was
through tours made of our bank.

The total number to be

shown the work of the Federal Reserve Bank in 1952 did not
reach the record total of 2,920 achieved in 1951, but during
the year 101 groups totaling 2,773 people visited our bank.
As in previous years, the greatest number of people visited
our bank during the months of April and May, when an average
of one high school group a day was shown through.
VI.

To encourage a favorable press, three avenues of approach
are used:

The newspapers in the district, the financial

press outside of the district, and banking periodicals are
provided news releases and feature story material.

Repre-

-53-

sentatives of the press are invited to attend meetings
sponsored by this bank.

Personal calls are made on

editors by representatives of our bank.
VII.

Not directly under the supervision of the Public Services
Department, but an essential part of the program, is the
work of the Research Department whose various publica­
tions have a wide mailing list including bankers, business
and professional men, teachers, students, and others
interested throughout the district.

In addition, our

economists delivered 115 addresses to audiences totaling

, .

12 640

Objective No. II is stated:

TO PROVIDE OPPORTUNITY FOR MUTUAL EX­

CHANGE OF IDEAS AMONG THE FEDERAL RESERVE SYSTEM, BANKERS, AND THE PUBLIC
AT LARGE, IN ORDER, and our bank attempted to work along the following lines




I.

The Assembly, held November 2U and 25} had as the bulk
of its audience the executive officers of our member
banks.

In addition to the program offered the audience,

the meeting gave the bankers and directors assembled an
opportunity to exchange opinions and ideas among them­
selves, the directors of other banks, and the representa­
tives of our bank.
II.

The Money and Banking Workshop described under Objective
No. 1 would qualify under Objective No. II since the
program content serves to keep the colleges and the
general public informed of developments, policies, and
so forth of the System.

III.

Visits to banks in the District would probably be the




activity of our bank which would come closest to working
toward Objective No. II.

During 1952, our officers and

senior staff members visited every bank in the District
at least once.

Originally the plan of the Public Services

Department was to make calls on every bank twice during
the year.

A review of the program (after the spring

visits in 1952) resulted in a decision to reduce the
number of calls made to one a year, thereby allowing more
time for each visit.

To supplement the one visit, the de­

partment now has a young man designated as a full-time
field representative.

The specific purpose of his visits

is to become acquainted with the younger bankers in the
District.

It is hoped that visits to banks in the Dis­

trict will accomplish two things.

First, that the

opportunity for our representatives to become personally
acquainted with commercial bankers will lead to friend­
ships which in turn will lead to a more amicable approach
to common problems.

Second,

that a firsthand appraisal

of economic and social conditions of an area visited will
broaden the background of our men which in turn will lead
to a better understanding of the problems of commercial
bankers.
Our bank was represented at all the State bankers' con­
ventions in the District and at as many group meetings
and other bankers' gatherings as could be scheduled
without undue expense.

To give the directors of our

bank an opportunity to meet bankers in the District,

for several years the department has arranged for their
attendance at one of the State conventions.

In 1952

conflicts in dates made it impossible to repeat this
program.

Two of our directors, however, toured the

North Dakota oil fields enroute to the Montana con­
vention.

We also arranged for the directors to hold

their August meeting in Duluth, to meet Duluth and Iron
Range bankers, and to view the developments on the Range
for the processing of low-grade ore.

While in Duluth,

the directors visited a refinery in Superior which at
present is processing oil delivered by pipeline from
Canada.
V.

Our Research Department, previously mentioned, is most
active in the work under Objective No. II.

Objective No. Ill, TO PROVIDE MEDIA FOR STUDY OF BANKING PROBLEMS
AND TECHNIQUES, AND ECONOMIC DEVELOPMENTS. WITH A VIEW TOWARD IMPROVEMENTS
THAT WILL CONTRIBUTE TO THE STRENGTH OF THE BANKING SYSTEM AS A WHOLE, was
represented by:




I.

The Assembly which also qualified under Objective No. 1
and II most certainly qualifies under No. Ill, since the
program provided a medium outlined in the objective.

II.

The program of our Money and Banking Workshop in 1952
qualifies this meeting under Objective No. III.

III.

In addition to the large group meetings previously
described, for nine years our bank has conducted a
meeting for the working members of the examining force
of the F.D.I.C., the national bank examiners, Federal




Reserve examiners, and the State banking departments
of the District.

The program of the meeting (held this

year on November 29) again included current economic and
banking topics.
IV.

Continuing the program which began in 194-8, the Federal
Reserve Bank of Minneapolis in 1952 offered to repre­
sentatives of our member banks the opportunity to attend
our Short Course in Central Banking.

The groups attend­

ing (as in previous years) had an opportunity to study
at firsthand the work of the Federal Reserve Bank as
it applies to our member banks, to discuss current
economic and monetary developments with our economists,
and to discuss banking problems and techniques with
representatives of other banks from other parts of the
District.

A recent canvass of our member banks indi­

cates a continued interest in our Short Course.

The

groups recently attending the Short Course have been
drawn mostly from the younger men and women in our
member banks.
V.

In 1949, at the suggestion of one of our member bankers
whose bank had been represented at our Short Course,
our bank started and has continued a program of sending
our senior men for a week's study at a commercial bank.
Details of this program have been handled by our
personnel department, but the Public Services Depart­
ment has solicited the banks which have taken our men
for training.

-57-

Some of the activities of our Public Services Department cannot
be readily catalogued, but in a sense supplement the efforts of other
functions.




I.

Our bank has a display of currency which it offers to
member banks for exhibit in their lobbies during
anniversary celebrations or open houses marking the
completion of a remodeling project.

II.

In 1950, in cooperation with the Secret Service, we
prepared a series of slides showing the features of
counterfeit currency.

These slides have been used in

the conduct of so-called counterfeit clinics for bank
employees, school groups, and other interested
organizations.

During 1952, we conducted three such

clinics.
III.

The department stands ready and willing to extend
services requested by bankers.

As an illustration,

we receive requests for information on plans for
anniversaries and other celebrations; to line up out­
side speakers for bankers' programs (if none of our
men are available); to obtain tickets for entertain­
ment events in the Twin Cities; and to assist in making
transportation reservations.
IV.

For several years the department has maintained an in­
formal clearinghouse for bankers requesting additional
personnel and bank employees seeking to change jobs.

V.

In addition to circulating to our own employees changes
in the Ninth District Bank Directory, the department

sends these changes to 55 holders of the directory in
other banks and business firms.
VI.

On the occasion of the celebration of a bank's or
banker's anniversary, the department prepares a
special citation.

Again, the broad objectives of a bank and public relations program
cannot be expected to be achieved in any one year.

Indeed it would be

difficult at any time to determine whether any one objective had been
achieved.
Fortunately, the objectives outlined by the system committee
direct rather than limit the scope of the activities of the Public Services
Department.

Functions which have been found acceptable are being repeated

and possibilities for new or improved methods are constantly being con­
sidered.

PPBCHASING
In 1952 purchase orders were placed with various firms for 2,851
items, a decrease of 286 items from 1951.

This reduction is largely due to

the increased use of our multilith duplicator for making bank forms which
were formerly purchased from outside suppliers.
During the year the departments of the bank requisitioned from the
stockroom a total of 10,309 items, listed on 4,151 requisitions.

Although

our stockroom inventory is kept at a minimum consistent with good operating
efficiency, the total value of supplies on hand is usually above $40 thousand.
The market for office supplies was very competitive during 1952, the
more intense competition causing suppliers to absorb increases in operating



-59-

costs to a large extent.

RESEARCH
Near the end of 1952 the research department and the library were
moved from the ground floor of the bank building to new quarters in the
Syndicate building.

This move provided the department with additional space

to accommodate an enlarged staff.

Since 1941, the number of research employees

has increased from 9 to 2 3 .
The work program of the department during 1952 was little changed
from that prevailing during 1951.
special regional research projects.

Again, considerable effort was devoted to
These supplemented the department's

regular research program which included many regular and special analyses of
economic conditions.
Four major regional projects were started during the year.

These

dealt with the district's manganese supplies, the Missouri River Basin De­
velopment, the processing of taconite, and Williston Basin oil developments.
Of these, two were completed and published during the year, and the other
two will be finished early in 1953.

The published reports were distributed

to the regular Monthly Review mailing list — one, "Meeting the Supply Problem
of Manganese - Vital Ingredient in Steelmaking" was published as a supplement
to the May 1952 Monthly Review; the other, "Williston Basin Progress Suggests
District Will Have Major Oil Producing Area" was carried as an article in the
July Review.
Speaking engagements, attendance at meetings, committee assignments,
and requests for special statistical and analytical reports continued to occupy
much of the department's time during 1952.



In addition to various bank com­

-60-

mittees, representatives of the department served on 12 Federal Reserve
System committees during the year.

Professional and educational organiza­

tions, such as the Minneapolis Economic Roundtable and the Minnesota Economics
Club were served by employees of the department in capacities ranging from
officers to committee members.

Speeches were delivered by the department's

economists at the Federal Reserve Assembly, the Examiners Conference, the
Money and Banking Workshop, and at other bank functions.

They also delivered

speeches before bankers' conventions and group meetings, service clubs, meet­
ings of farm groups, etc.

Ninety-nine such talks were given outside the bank

before a combined audience of more than 12,000 people.
It is estimated that from 10 to 12 per cent of the time of senior
members of the department was spent in answering the wide variety of special
requests which were received from businessmen, students, and others through­
out the district.

Many of these requests also required a degree of clerical

work in compiling basic statistical data.
Numerous statistical series designed to provide adequate factual
information regarding current agricultural, business, and financial condi­
tions were compiled throughout the year.

Much of this information was dis­

tributed to interested persons and to newspapers through the medium of
periodic statistical releases.
pared at the present time.

Twelve different types of releases are pre­

These are mailed to approximately 3,500 users

throughout the country.
Publications issued by the department - the Farm News and the Monthly
Review - continued to increase in circulation.

The Farm News, which is the

more widely distributed of the two, increased its circulation by 1,700 during
the year.

About 11,700 copies of this pamphlet are now sent out each month to

individuals, either directly or through bankers and school teachers.



At

-61-

year-end, the Monthly Review was being mailed to 8,927 people - this is an
increase of over 500 during the year.
In addition to special articles devoted to major regional research
projects, other Review articles featured during the year include "Arrested
Inflation Characterized 1951" in the January Review; "Recovery in the Hous­
ing Market Has Continued" in the September Review; and "Drouth, Production
Costs, Cloud Farm Outlook" in the November Review.
During the year the facilities of the library were used by approxi­
mately 6,600 people.

Most of these were research department employees, the

remainder being made up of 1,900 service calls from other departments of the
bank, and 500 persons from outside the bank.
crease of 1,000 patrons from 1951.

This represents an overall in­

As in previous years, most of the demand

for library material was for current publications such as newspapers,
periodicals, and statistical releases.

These types of material accounted

for 35,000 out of a total of 39,000 pieces of library material used.

MEMBER BANK RESERVES
Reserve requirements for all member banks remained unchanged dur­
ing the year 1952 as shown by the table below:
Bank Classification
Country Banks
Reserve City Banks
Central Reserve City Banks

Net Demand Deposits

Time Deposits

14$
20$
24$

6$
6$
6$

The number and amount of penalties assessed during 1952 decreased
over the previous year; however, the dollar amount of penalties waived in­
creased substantially although there was a slight decrease in the number
waived.



Penalties assessed at the head office decreased 38.6% in number
and 38.9% in dollar amount, and at the Helena 3ranch 15.5% in number and
32.9% in amount.

Penalties assessed for head office and Helena Branch com­

bined decreased 31.5% in number and 36.7% in amount.
Penalties waived at the head office decreased 20% in number but
increased 13.5% in amount and at the Helena Branch, increased 8.8% in number
and 85.2% in amount.
This increase in the dollar amount of penalties waived is the re­
sult of the Reserve City Banks in the Twin Cities and Helena, with their
large reserve requirements, taking advantage of the opportunity to use the
rule under which a deficiency in one period may be offset by excess reserves
in the following period, provided that such deficiency does not exceed 2%
of a bank's reserve.

Out of 36% of the number and 77.7% of the dollar

amount of all penalties waived under this rule for all banks, 4-0,3% of the
number and 86.3% of the dollar amount were waived for deficiencies of Reserve
City Banks,
There was a decrease also in the number of penalties waived under
the rule which permits a penalty to be waived on a deficiency of not more
than 5% of the member bank's required reserve, provided that a penalty has
not been waived under this rule within a two year period.

Fifteen per cent

of all penalties waived and 17.8% of the dollar amount were in this classifi­
cation.
Forty-nine per cent of the number of all penalties waived with only
4.5% in dollar amount were waived under the rule which applies to penalties
not in excess of $5.00.




During 1952, 73 banks were penalized for a total of 124 times,

-63-

compared with 104 banks for 181 times in 1951.

The following is a compara­

tive report by states of penalties for deficiencies in reserves during 1952
and 1951:
Penalties Waived

Penalties Assessed
1952
No. Amount
Michigan
Minnesota
North Dak.
South Dak.
Wisconsin
Head Off.
Totals
Helena
Branch
Combined

1951
No. Amount

19 $ 879.64
47 1331.06
7
278.46
10
303.97
3
63.03

17 $ 604.28
64 2637.23
20
601.11
18
469.05
17
363.08

86 $2856.16

136 $4674.75

38

1850,65___ 4 5

124 $4706.81

1952
No, Amount

'52 '51 152 Jjjl
No. N o . No. N o .

24 $ 240.48 32 $ 204.04 6
139 6323.52 179 5371.15 28
21
154-28 25
398.07 5
41
332.41 36
547.53 10
28
116.96 46
185.96 3

8 14 21
35 66 90
11 13 16
13 27 25
12 15 22

253 $7167,65 318 $6706.75 52

79 135 174

2758.06

181 $7432.81

1951
No. Amount

Banks Affected
Assessed Waived

74

2226.37

68

1202.27 21

25

36

31

327 $9394.02 386 $7909.02 73 104 171 205

SAFEKEEPING
Securities held for safekeeping

and collateral purposes as of

December 31, 1952, were $1,484 million, an increase of $113 million compared
with the $1,371 million held a year ago, as reflected by the comparative
figures for 1952 and 1951 shown below:
12-31-52
Inc. or Dec
12-31-51
(In thousands of dollars)
Accounts
Securities held in safekeeping
(Not pledged)
Securities pledged to secure
public deposits
^Securities pledged to secure
Government deposits
**Securities pledged to secure
Treasury Tax and Loan Account
■^Securities held as collateral
for Discounts and Advances



877,993

829,44-9

+ 48,544

327,685

295,762

+ 31,923

11,683

10,064

234,809

203,424

30,250

30,242

+

1,619

+ 31,835
+

8

-64-

12-31-52
Accounts

(continued)

Securities held as collateral to
Consignment Account - U.S.Savings
Bonds, Series E
Securities held for Public Housing
Administration

12-31-51
Inc. or Dec.
(in thousands of dollars)

4-5

4-5

0

____ 1,704________ 1.712_______ -______ 8
$1,484,169
$1,370,698
+113,471

* Includes $2,815}000 held by commercial banks.
** Includes $20,4305000 held by commercial banks and other Federal
Reserve banks„
**# Includes $25,300,000 held by commercial banks.
The safekeeping department received 53,584 pieces of securities,
issued 7,336 receipts, and delivered 49,334 pieces in 8,752 transactions,
resulting in a net increase of 4,250 pieces of securities held during the
year.
This department also made 5,828 transfers of securities from one
account to another, and clipped 273 thousand coupons from securities held
during 1952.
The table below shows comparative volume figures for 1952 and 1951s
19.52
Receipts issued
Pieces received
Withdrawals handled
Pieces delivered
Transfers from one account to another
Coupons clipped
Custodian receipts issued

7,336
53,584
8,752
49,334
5,828
273,629
1,053

1951
5,228
44,^97
6,442
47,359
6,198
263 <662
1,021

Inc. or ]
+
+
+
+

2,108
9,087
2,310
1,975
370
+ 4,967
+
32

WIRE TRANSFERS
During 1952 the Wire Transfer Division handled a total of $13.1
billion in wire transfers.



This figure is approximately $500 million lower
-65-

than 1951.

Of this $13.1 billion, $4.5 billion (or 34$) were transfers to

other Federal Reserve districts, $6.1 billion (or 47$) were transfers re­
ceived from other Federal Reserve districts, and the remaining $2.5 billion
(or 19$) were transfers within our own district.
The total number of transfers handled in 1952 was 43,319, which
is an increase of 663 over the 1951 figure.
The average dollar amount of transfers decreased to $303.6 thou­
sand in 1952 from $319 thousand in 1951.
A total of 73,688 telegrams was handled - an increase of 5,524
over 1951.

Of this number, 59,918 were transmitted over our leased private

wire system - an increase of 4,283 over 1951.
split between commercial wire and TWX.
totaled 7,005 and TWX 6,765.

The remaining 13,770 were

Commercial wire (Western Union)

The combination of commercial and TWX (total

of 13,770) was 1,241 over commercial last year.

Our TWX system was not

installed until November 1951; therefore, no comparative figures are avail­
able ,




-66-

MILLION DOLLARS

i
0
<2
1



M ILLIO N DOLLARS

CAPITAL ACCOUNTS

CAPITAL STOCK paid in totaled §
5,719 thousand on December 31,
1952, an increase of $356 thousand during the year.
SURPLUS ACCOUNTS.

Surplus (Section 7) was increased $1,068 thou­

sand on December 31, 1952, which brings the total to $15,131 thousand, Sur­
plus (Section 13b) remained unchanged at $1,073 thousand.
RESERVES FOR CONTINGENCIES.

No change was made in the reserve

of $1 million set aside for losses in excess of the blanket bond coverage;
the reserve of $500 thousand earmarked for losses not covered by the Loss
Sharing Agreement; or the special reserve for contingencies of $2,4-76
thousand.
The reserve for registered mail losses totaled $215 thousand as
of December 31, 1952.

This is an increase of $14 thousand during the year.

A loss of $199.72 was charged against this reserve.
The table below reflects the changes made in this account during
1952.
Reserve for registered mail losses
beginning of year 1952
Debit:
Our pro rata share of loss sustained by
the Federal Reserve Bank of Philadelphia
Credit:
Annual addition based on 2^ per $1000 of
total shipments of $713,358,440 for 12-month
period Dec. 1, 1951 through Nov. 30, 1952
Net additions during year
Reserve for Registered Mail Losses, Dec. 31, 1952




$200,883.70

$

199.72

14.267.17
14.067.45
$214,951.15

-68-

The following table shows currency and coin shipments made during
the fiscal year December 1, 1951 to November 30, 1952, which were the basis
for the addition to the registered mail loss reserve.
1952
(000 Omitted)

1951
(000 Omitted)

$151,260
60,569

$176,520
46,582

Registered Mail
New F.R. currency from Washington
Fit F.R. notes to bank of issue
Currency and coin between Minneapolis
and Helena
Other currency and coin outgoing Minneapolis and Helena
Other currency and coin incoming Minneapolis and Helena

1,920*

8,290

216,746
276,4P5

251,885

2,433
8.430
$717,763

Railway Express and Truck Delivery
All Other:
Other currency and coin outgoing
Other currency and coin incoming

211,607

3,059
8.605
$706,548

^Whenever notes are available in Washington, shipments are made
direct to the Helena Branch from that source.
The disposition of 1952 net earnings and the changes made in the
surplus accounts are shown below:
Net Earnings
Dividends Paid
Paid U.S. Treasury (interest on
F.R. Notes)
Transferred to Surplus (Section 7)

Surplus (Section 7) December 31, 1951
Transferred from Earnings 1952
Surplus (Section 7) December 31, 1952




$11,013,615.81
$

327,905.73
9,617,021.12

9.944.926.35
$ 1,068,688.96

$L4,062,607.68
1.068.688.96
$15,131,296.64

-69-

DIVIDENDS

As of December 31, 1952, capital stock held by member banks totaled
$5,719,300, on which accrued dividends totaling $327,906 were paid.
year's dividend payment is the largest for any single year in the

This
history

of the bank and when combined with previous years' payments, bring the ag­
gregate total to $7,638,071.
Distribution of 1952 and 1951 Dividends
1252_________
Dividend
No. of Banks
Paid

State
Michigan
Minnesota
Montana
North Dakota
South Dakota
Wisconsin

40
206
83
42
63
42
476

___________1251.
No. of Banks

$ 17,996.05
209,882.87
35,091.94
19,873.72
27,052.68
18.008.47
$327,905.73

41
206
84
42
62
41
476

Dividend
Paid

$ 17,122.73
205,180.24
32,040.71
18,598.58
24,934.37
17.057.60
$314,934.23

Change
$+
873.32
+ 4,702.63
+ 3,051.23
+ 1,275.14
+ 2,118.31
+
950.87
$+12,971.50

TABLE OF DIVIDENDS PAID SINCE ORGANIZATION
1914
1915
1916
1917
1918
1919
1920
1921
1922
1923
1924
1925
1926
1927
1928
1929
1930
1931
1932
1933

$ 57,719.87 ft
363,894.19 W
168,102.97
180,186.21
195,870.65
211,657.03
213,774.01
212,732.68
202,827.98
193,559.46
187,609.25
180,726.51
181,202.86
184,029.92
184,4-4-5.39 ,
180,454- 53 2J
175,4-94-. 80
171,568.89

1934
1935
1936
1937
1938
1939
1940
1941
194-2
1943
1944
1945
1946
1947
1948
1949
1950
1951
1952

$

181,117.51
185,448.45
179,052.04
174,057.31
174,231.27
174,905.39
177,400.58
179,789.68
183,336.33
190,924.19
206,158.74
221 ,686.96
238,372.30
253,251.30
262,776.22
272,831.22
294,034.00
314,934.23
327,905.73
$7,638,070.65

a/ For period November 1, 1914- through June 30, 1915.
b/ For period July 1, 1915 through December 31, 1917.
c/ $134,649.67 withdrawn from Surplus to pay dividend.




-70-

BANK PREMISES

Improvements made during 1952 to the Head Office building were
charged to Repairs and Alterations.

A depreciation of 2% was taken on both

the Helena and Minneapolis buildings while no additions to the book value of
either building were made during the year.

Inasmuch as a full reserve had

already been established, the reserve for depreciation on fixed machinery and
equipment of the Head Office was not increased.

The Helena Branch took a

normal depreciation of 10% on fixed machinery and equipment.
Below are listed the principal repairs or alterations to the Head
Office building during 1952 and projects near completion at year's end.




1.

Additional space was acquired in the Currency Department and
the bank floor by removal of number 7 elevator located in front
of the vault.

2.

Projects near completion a.

Installation of three windows in the front wall of the

reception room between the president's and chairman of the
board's offices.

This space is to be occupied by the Public

Services Department.
b.

Conversion from a single phase lighting service to a three

phase four-wire service to take care of any emergency.
c.

Converting space in two grilles on the ground floor of the

main vault for storage of currency.

-71-

BANK PREMISES
Head
Office

Total
BANK PREMISES:
Gross Book Value:
Beginning of 1952 (no change during
year) ........... . 01,384,281.50

Helena
Branch

$1,283,281.50

#101,000.00

Allowance for Depreciation:
Beginning of 1952 ..................
Normal depreciation ............. . •

715,821.36
27,685.56

$

692,971.56
25.665.60

$ 22,849.80
2,019.96

End of Year .........................

. $

743,506.92

$

718,637.16

$ 24,869.76

Net book value December 31, 1952 . . . . $

640,774.58

e

564,644.34

$ 76,130.24

FIXED MACHINERY AND EQUIPMENT:
Gross Book Value:
Beginning of 1952 (no change during
year) ...........

698,171.34

$

660,969.35

$ 37,201.99

694,336.46
3.720.24

$

660,969.35

$ 33,367.11
3,720.24

698,056.70

$

660,969.35

$ 37,087.35

114.64

$

-

410,520.66

$

400,520.66

$ 10,000.00

$1,051,4-09.88

$

965,165.00

$ 86,244-.88

. e

Allowance for Depreciation:
Normal depreciation

...............

Net book value December 31, 1952 . . . . $

$

114.64

LAND:
.

TOTAL BANK PREMISES:
Net book value December 31, 1952 . . . .




$




NET EARNINGS & PROFITS

Net earnings and profits for the year 1952 totaled $11,014 thou­
sand.

This figure established a new all-time high and exceeds the 1951 total

by $1,754- thousand.
A statement of net earnings and profits is shown below:
Change
from 1951

1952
Current Earnings
Current Expenses
Current Net Earnings
Additions to Current Net Earnings:
Profit on U.S. Government
Securities sold, net
All Other
Total Additions

$14-,300,838
3.291.556
$11,009,282

$62,4-31
79
$62,510

$+1,835,939
+ 153.511
$+1,682,4-28

$+
62,4-31
+________f>7
$+
62,488

Deductions from Current Net Earnings:
Loss on U.S. Government Securities
sold, net
Fees paid to architect for project
not carried out
$4-2,517
Reserve for Registered Mail Losses 14-,267
All Other
1.392
Total Deductions
$58,176

$-

51,867

+
4-2,517
+
136
+______ 171
$9,04-3

Net Additions to Current Net Earnings

$_____ 4 .334.
-

$+

71.531

Net Earnings and Profits

$11,013,616*

$+1,753,959

*For disposition of profits see page No. 69 .




-74-

The table below gives a breakdown of Profit and Loss during 1952.
Head
Office

Total

Helena
Branch

Additions to Current Net Earnings;
Profit on U. S. Govt, securities sold, net
Overage in uncurrent coin shipments to U. S.
Mint, Denver, on 1-23-52
Extra dividend on our cash letter claim for
$98.85 sent to F.R.B. Chicago on closed
bank, First National Bank, Georgia, Iowa

$62,431.28
3.36

$62,431.28

$

-

3.36

3.36

.68

.68

$62,435.32

$62,431.96

$

$14,267.17

$14,267.17

$

.62

.62

-

Loss on counterfeits

275.61

275.61

-

Difference account

275.52

303.51

-27.99

5.18

12.07

- 6.89

692.69

692.69

Silver certificate altered to $50.00. Bill
found in Receiving Teller's cash 6-27-52.
Source unknown.

49.00

49.00

Silver certificate altered to $20.00. Bill
found in currency sorted by I. Iverson.
Source unknown.

19.00

19.00

Fees paid to architect for project not carriedi
out
42.517.00

42.517.00

Total Additions

Deductions from Current Net Earnings:
Reserve for Registered Mail losses
Discount on foreign currency and coin

Loss on mutilated currency and coin
Difference between the estimated and actual
expense for Fiscal Agency for December 1951

-

Total Deductions

$58,101.79

$58,136.67

$ -•34.88

Net Additions to Current Net Earnings

$ 4,333.53

$ 4,295.29

$




38.24

-75-

I
O'
'
I



EARNINGS

An increase during the year of $20 million in our average daily
holdings of U.S. Government securities, together with a rise in the average
yield from 1.71$ to 1.91$, reflect the major increase in our earnings over
1951.

The table below shows changes in the various earning accounts:
1952

Discounts and Advances
Foreign Loans on Gold
Industrial Loans
U.S. Govt. Securities-System Account
Deficient Reserve Penalties
Commission Earned on Bankers' Acceptances
purchased for foreign correspondents
Interest on Personal Loans to Employees
Clearinghouse Fines

$

Change
from 1951

277,228
9,567
5,515
14 j,003,295
4,694

$+
+

370
33
126
$14,300,838

+

87,094
9,381
2,269
+1,744,925
2,752

464
33

$+1,835,939

The average daily holding of bills discounted for the year 1952
was $15,785 thousand and resulted in earnings of $277,228 as compared with
last year's average of $10,853 thousand and earnings of $190,134-.
return for the year was 1.75$.

The average

For ten months during 1952 our bank partici­

pated in foreign loans on gold as compared with only two months in 1951.
This resulted in an increase of $533 thousand over 1951 in our daily average.
Earnings were $9,567 during 1952 as compared with $186 for the year 1951 at
the average yield of 1.76$.

Our 1952 daily average holding of industrial

loans decreased to $110 thousand from $156 thousand in 1951, and, as a
result, earnings from that source were $ 2,269 less than for the previous year.
The average yield was 5.01$.

For the year 1952, the average yield from loans

to Ninth District banks, foreign loans on gold, U.S. Government securities,
and industrial loans was 1.9126$.




During 1951 the average yield on these

-77-

combined holdings was 1.7127$.

Our average daily participation in Open

Market securities was $731 million, whereas one year ago the daily average
was $716 million.
1951.

The average yield was 1.91$ for 1952 against 1.71$ for

Earnings from these securities were $L4,003 thousand compared with

$12,258 thousand one year ago.
As of December 31, 1952, the bank's total participation in U.S.
Government securities held increased $15 million.

The following table

indicates the bank's holdings as of December 31, 1952, and shows the dollar
increase or decrease in comparison with December 31, 1951.




Change
12-31-52
from 1951
(In thousands of dollars)
Bonds
Notes
Bills
Certificates

$14-3,939
4-38,430
23,013
159.018
$764,400

$- 25,716
+277,539
+ 8,161
-24.4.937
$+ 15,047

-78-

MILLION DOLLARS




MILLION DOLLARS

COMPARATIVE STATEMENT OF NET CURRENT EXPENSES
Head
Office
1952
Salaries:
Officers
Employees
Fe es :
Directors
Federal Advisory Council
Other
Retirement Contributions:
F.R. Retirement System
Supplemental Death Benefit
Social Security
Traveling Expenses:
Directors
Federal Advisory Council
Other
Postage and Expressage:
Original Shipments of F.R. Currency
Redemption of F.R. Currency
Other
Telephone and Telegraph
Printing, Stationery & Supplies
Insurance
Taxes on Real Estate
Depreciation
Light, Heat, Power & Water
Repairs & Alterations
Rent
Furniture & Equipment:
Purchases
Rentals
Assessment for expenses of Bd. of Gov.
Federal Reserve Currency:
Original Cost
Cost of Redemption
All Other
Total Expense
Miscellaneous Recoveries:
Coin Wrapping
Rental of Furniture & Equipment
Rental of Space
Postal Money Orders
Other
Total Recoveries
Total Net Current Expenses



199,384
1,458,276

$ 19,872
144,719

5,775
1,125
3,490

$

Helena
Branch
1952

3,820

Combined
$

219,256
1,602,995

Combined
1951
$

215,304
1,484,718

690

9,595
1,125
4,180

8,375
1,050
5,773

110,334
4,289
21,208

10,804
565
2,185

121,138
4,854
23,393

123,124
2,896
21,952

4,561
715
57,794

2,352

6,913
715
62,801

6,698
725
77,855

41,030
17,313
377,181
29,067
115,496
13,394
96,824
31,406
31,939
20,648
48,241

35,903
13,182
333,970
27,438
118,895
18,644
97,164
31,406
27,125
93,392
48,618

47,762
121,576
105,000

28,574
63,144
103,700

140,559
5,988
79,802
$3,380,191

127,550
7,695
81.649
$3,206,519

9,327
2,887
33,938
39,621
2.862
88,635

8,570
3,030
37,703
15,374
3.797
68,474

—

-

5,007

41,030
14,674
317,066
19,582
105,982
11,533
92,224
25,666
29,484
18,972
48,218

-

2,639
60,115
9,485
9,514
1,861
4,600
5,740
2,455
1,676
23
2,631
15,959

45,131
105,617
105,000
140,559
5,988
76.096
$3,069,773

$

8,155
2,887
33,434
36,658
2.862
83,996

$2,985,777

-

-

3,706
$310,418
1,172
-

504
2,963
$

4,639

$305,779

$

$3,291,556

$

$3,138,045
-80-

NONREIMBURSABLE EXPENSE

1952
$2,985,777
305.779
$3,291,556

Head Office
Helena Branch

Change
from 1951
$+129,4-75
+ 2L .036
$+153,511

Head Office expense, after deduction of reimbursable expense,
increased $129 thousand compared with the year 1951.

Principal increases

over last year were in salaries; postage and expressagej telephone and
telegraph; light, heat, power and water; furniture and equipment-purchases
and rentals; Federal Reserve currency-original cost and cost of redemption.
Principal decreases were in traveling expenses-other, insurance, and repairs
and alterations.
Helena Branch expense increased $24- thousand over last year.
The larger increases were in salaries, postage and expressage, and furni­
ture and equipment-rentals.

SALARIES

1952
Head Office
Helena Branch

Change
from 1951

$1,657,660
164..591
$1,822,251

$+104,182
+ 18.04.8
$+122,230

Head Office salaries for 1952 totaled $1,657 thousand, an increase
of $104- thousand over last year.

This increase is due to merit and salary

adjustments as the average number (623) of employees for the year was the
same as in 1951.




-81-

FEES _ DIRECTORS

1952
Head Office
Helena Branch

$5,775
3.820
$9,595

Change
from 1951
$+ 4-25
+ 795
$+1,220

Increased attendance in the eleven meetings held in 1952 account
for this increase.

FEES _ FEDERAL ADVISORY COUNCIL

1952
$1,125

Head Office

Change
from 1951
$+75

In 1952, our Council member attended seven local and four out-oftown meetings; in 1951 he attended four local and four out-of-town meetings.

FEES _ OTHER

Head Office
Helena Branch

1952
$3,490
690
$4,180

Change
from 1951
$-1,728
+__ 13j5
$-1,593

In 1951 this bank paid honorarium fees of approximately $1,100
to speakers in connection with the Member Bank Conference and Forum, whereas
in 1952 these two meetings were not held.




-82-

RETIREMENT CONTRIBUTIONS

F.R. RETIREMENT SYSTEM
1952
$110,33410.804

$-2,015
+
29

$ 121,138

Head Office
Helena Branch

Change
from 1951

$ - 1,986

The retirement rate was reduced from 7.22 to 7.20 on July 1,
1952.
SUPPLEMENTAL DEATH BENEFIT
1952
$4,289
565
$4,854

Head Office
Helena Branch

Change
from 1951
$+1,623
+ 335
$+1,958

Contributions to Supplemental Death Benefit began on November 1,
1951.

The $4,289 represents the first complete year's net expense to the

bank for this coverage.
SOCIAL SECURITY
1952
Head Office
Helena Branch

Change
from 1951

$21,208
2.185
$23,393

$+1,230
+__ 211
$+1,441

Larger salary costs account for the increase in Social Security tax
payment during 1952.




-83-

TRAVEL _ DIRECTORS

1952
Head Office
Helena Branch

$4-,561
2.352
$6,913

Change
from 1951
$-608
+823
$+215

Eleven meetings were held during the year as compared with twelve
in 1951.

TRAVEL _ FEDERAL ADVISORY COUNCIL

1952
$715

Head Office

Change
from 1951
$-9

In 1952 our council member attended four out-of-town meetings.

TRAVEL _ OTHER

1952
Head Office
Helena Branch

Change
from 1951

$57,794
5.007
$ 62,801

$-34-, 895
167
$ - 15,062

The decrease of $14,895 in Head Office travel is primarily due
to the termination of credit controls - Regulation W on May 7 and Regula­
tion X on September 16.




POSTAGE & EXPRESSAGE
Original Shipments
F. R. Currency

1952
$41,030

Head Office

Change
from 1951
$+5,127

Higher postal rates were the chief cause of this increase.

POSTAGE & EXPRESSAGE
Redemption
F. R. Currency

1952.
Head Office
Helena Branch

$14,6742.639
$17,313

Change
from 1951
$+4-,694- 563
$+4-, 131

The large increase in the number of bills forwarded for redemption i 3 the principal reason for this increase.

POSTAGE & EXPRESSAGE
Other
Change
from 1951
Head Office
Helena Branch

$317,066
60.115
$377,181

$+31,952
+11.377
$+43,329

Increased postage and expressage costs, together with greater
volume, account




for this increase.

TELEPHONE & TELEGRAPH

1952
$19,582
9.485
$29,067

Head Office
Helena Branch

Change
from 1951
$+ 1,062
+ 567
$+1,629

Increases were $600 in toll calls, $1,500 in telephone equipment
rental due to increased rates, and $250 in leased wire costs.

There was a

decrease of $1,300 in commercial messages.

PRINTING, STATIONERY & SUPPLIES

m 2

$105,982
9.514
$115,496

Head Office
Helena Branch

Change
from 1951
$-3,845
+ A4.6
$-3,399

This decrease is largely due to the increased use of our multilith
duplicator for making bank forms which were formerly purchased from outside
suppliers,

INSURANCE

1952
Head Office
Helena Branch

Change
from 1951

$11,533
1.861
$13,394

$-5,408
+ 158
$-5,250

As of April 1, 1952, this bank terminated its group insurance
contracts with the Equitable Life Assurance Society.



This accounts for
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the decrease of $5,4-08.

TAXES ON REAL ESTATE

1952
Head Office
Helena Branch

Change
from 1951

$92,224
4-.600
$96,824-

$-592
+252
$-340

The tax rate was reduced from 14-5 mills to 14-4 mills.

DEPRECIATION ON BANK BUILDING
& FIXED MACHINERY & EQUIPMENT

1952
Head Office
Helena Branch

Change
from 1951

$25,666
5.740
$31,406

Depreciation on buildings, including vaults, is at the rate of
2 % per annum, and on fixed machinery and equipment at 10$ per annum of the
gross book value.




LIGHT, HEAT, POWER & WATER

1952
Head Office
Helena Branch

Change
from 1951

$29,484
2.455
$31,939

$+4,835
21
$+4,814

The Head Office total of $29,484 covers -

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Light & Power
Heat
Water
Sewage
Gas

$22,751
4,520
1,4-12
589
212

Higher light and power rates, together with much larger IBM
equipment operations, account




for the increase of $4-,835 during 1952.

REPAIRS & ALTERATIONS

1952
$18,972
1.676
$20,64.8

Head Office
Helena Branch

Change
from 1951
$-62,580
-10.164$-72,744-

The larger items of expense at Head Office during 1952 were:
1.

Painting, plastering, and washing walls and ceilings for
general maintenance of building, $4,700.

2.

Maintenance of elevators, $4,400.

3.

Removal of elevator and shaft from Currency Department to
Bank floor, $2,300.

4.

Sinking two test holes beside concrete caissons, $1,350.

5.

Repair of water and gas main outside of building, $1,000,

RENT

1952
Head Office

$48,218

Change
from 1951
$-380

The 1952 figure includes rental of space in an adjacent building

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totaling approximately $4-7,000 and space leased in the Wayzata State Bank
in connection with the Security Files program at an annual rental cost of

$1 ,200 .

FURNITURE & EQUIPMENT
Purchases

1952
Head Office
Helena Branch

$45,131
2.631
$47,762

Change
from 1951
$+19,908
720
$+19,188

The larger purchases during 1952 were:
Bookkeeping machines
Chairs
Desks
Carpeting of executive offices
Plymouth Club coupe
Chevrolet Sedan delivery truck
Adding machines
Typewriters
Time Card machine
Files

$10,228
5,952
3,398
2,900
2,240
1,940
1,877
1,436
1,214
1,077

FURNITURE & EQUIPMENT
Rentals

1952
Head Office
Helena Branch

$105,617
15.959
$121,576

Change
from 1951
$+53,832
+ 4.600
$+58,432

The 1952 figure reflects a full year's rental cost of IBM equip­
ment in the Check Collection Department whereas the 1951 figure reflects




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only a partial year's rental due to the installation of the major portion
of this equipment during that year.

BOARD ASSESSMENT

1252

$105,000

Head Office

Change
from 1951
$+1,300

The Board of Governors early in each semiannual period, levies
upon the Federal Reserve banks in proportion to the capital stock and surplus
of each, an assessment sufficient to pay the estimated expenses and salaries
of its members and employees for the period, plus any deficit carried for­
ward from the preceding period.
The basis for our assessments for the years 1952 and 1951 are
shown below:




First Half
Capital Stock
Surplus (Section 7)
Surplus (Section 13b)

1952

,

$ 5,362,650
1.072.621
$20,497,879

$ 5,073,700
13 168,052
1.072.621
$19,314,373

.00265

.00291

14 062,608

Assessment Rate
Total Assessment for
First Half

$

54,300

,

$

56,200

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1952

1951

$ 5 ,466,400
14,062,608
1.072.621
$20,601,629

$ 5,235,450
13,168,052
1.072.621
$19,476,123

.00246

.00244

Second Half
Capital Stock
Surplus (Section 7)
Surplus (Section 13b)
Assessment Rate
Total Assessment for
Second Half

$

50,700

$

47,500

Total Assessment for Year

$

105,000

$

103,700

FEDERAL RESERVE CURRENCY

1952
Original Cost
Cost of Redemption

$140,559
5.988
$146,547

Change
from 1951
$+13,009
- 1.707
$+11,302

Higher printing costs, together with greater volume, account for
this increase.

ALL OTHER

1952
Head Office
Helena Branch

Change
from 1951

$76,096
3.706
$79,802

$-1,438
- 409
C l , 847

All Other expense during 1952 reflects a slight increase over
1951.




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MISCELLANEOUS r e c o v e r i e s

1952
Head Office
Helena Branch

Change
from 1951

$83,996
4. 639
$88,635

$+18,4-63
+ 1.698
$+20,161

Itemization i s :
Head Office
Coin Wrapping
Rental of Furn. & Equip.
Rental of Space
Postal Money Orders
Other

$ 8,155
2,887
33,43436,658
2.862
$83,996

Helena Branch
$1,172
5042,963
$4,639

This bank became paying agent for postal money orders on July 1,
1951, and for the last half of that year was reimbursed $14,181 for its
services.

For the full year 1952 we received $ 36 ,658, an increase of

$22,477.
Rent received from government agencies for space, furniture, and
equipment (deducted from total expense) totaled $36,321 during 1952 for the
Head Office, a decrease of $4,044 compared with the previous year.

The

chief cause of this decrease was due to a reduction in space required for
Fiscal Agency operations.




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REIMBURSABLE EXPENDITURES

Account of
Public Debt
Federal Taxes
Currency Reports
Reconstruction Finance Corporation
Federal Farm Mortgage Corporation
Federal Land Banks
Federal Intermediate Credit Banks
Public Housing Administration
Commodity Credit Corporation
War Department
Central Bank for Cooperatives
Federal Home Loan Banks
Home Owners' Loan Corporation

1952

Change
from 1951

$506,343
23,347
221
87
68
487
88
24
11,571
5,682
30
51
62
$548,066

$-4,239
-1,276
+ 183
- 941
+
7
+ 339
+
58
16
+2,233
-3,156
+
30
79
18
$-6,875

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