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FEDERAL RESERVE BANK OF CHICAGO

PRESIDENT’S REPORT TO DIRECTORS
ACTIVITIES
FOR THE YEAR 1943

PRESIDENT'S REPORT TO DIRECTORS

ACTIVITIES OF THE HEAD OFFICE AND DETROIT BRANCH
During the Year 19^3

COMPARATIVE STATEMENT OF EARNINGS AND EXPENSES
Years 19^3-19^2

COMPARATIVE STATEMENT OF CONDITION
December 31>19^3 -December 31>19^2
and
STATEMENT OF EARNINGS AND EXPENSES - DISPOSITION OF NET EARNINGS
Years 191^— 19^-3 Inclusive

NEW FUNCTIONS ADDED DURING YEAR 194}

THREE NEW FUNCTIONS WERE ADDED TO THOSE ALREADY BEING
PERFORMED BY THE FEDERAL RESERVE BANK OF CHICAGO DURING
THE YEAR 1943.

RATION CHECK DEPARTMENT COMMENCED OPERATIONS IN THE
MONTH OF FEBRUARY,
MONTH OF APRIL,

WAR BOND CUSTODY DEPARTMENT IN THE

AND WITHHELD TAX DEPARTMENT IN

THE

MONTH OF JULY.

THE ACTIVITIES OF THESE NEW DEPARTMENTS ARE SHOWN UNDER
THEIR RESPECTIVE NAMES ELSEWHERE IN THIS REPORT.

* * I N D EX**
Page
ACCOUNTING DEPARTMENT:
Bookkeeping Division.............................................. 1
Federal Reserve Books Division ................................
1
General Books Division............................................ 1
BANK EXAMINATION DEPARTMENT ..............................................
BANK RELATIONS DEPARTMENT..................................................
BINDERY AND OLD RECORDS DIVISION............................................
BUILDING DEPARTMENT........................................................

1
5
6
6

CAFETERIA ................................................................
CASH DEPARTMENT............................................................
CHECK DEPARTMENT............................................................
CODES AND TELEGRAMS DIVISION................................................
COLLECTION DEPARTMENT.....................
CONSUMER CREDIT DEPARTMENT..................................................

7
7
8
8
8
9

DISBURSING DEPARTMENT..................................................... 11
DISCOUNT AND CREDIT DEPARTMENTS........................................... 11
FEDERAL RESERVE NOTE ISSUE DEPARTMENT..................................... 12
FILES DEPARTMENT........................................................... 12
FOREIGN FUNDS CONTROL DIVISION............................................. 13
GOVERNMENT BOND DEPARTMENT................................................. 13
INVESTMENT DEPARTMENT....................................

15

LEGAL DEPARTMENT........................................................... 17
MAIL D I V I S I O N ............................................................. 17
MEMBER BANK ACCOUNTS DIVISION . . '......................................... 17
OFFICE MACHINE REPAIRS..................................................... 18
PERSONNEL DEPARTMENT....................................................... 18
PLANNING DEPARTMENT....................................................... 20
PURCHASING DEPARTMENT..................................................... 21
RATION CHECK DEPARTMENT................................................... 21
R.F.C. CUSTODY DIVISION .................................................. 21
RESEARCH AND STATISTICS DEPARTMENT......................................... 22
SAFEKEEPING DEPARTMENT..................

23

TELEPHONE DIVISION.........................................................

2k

WAR BOND CUSTODY DEPARTMENT............................................... 2k
WIRE TRANSFER DIVISION..................................................... 25
WITHHELD TAX DEPARTMENT................................................... 25
DETROIT BRANCH............................................................. 26
COMPARATIVE STATEMENT OF EARNINGSAND EXPENSES - Years 19*0-19^2............ 31
COMPARATIVE STATEMENT OF CONDITION - December 31, 19^3-December 31> 19k2. . 32
STATEMENT OF EARNINGS AND EXPENSES - DISPOSITION OF NET EARNINGS
Years 191^ - 19^3, Inclusive. . ...................................... 33

*

*

- 1 -

ACCOUNTING DEPARTMENT:
bookkeeping Division
This division functioned 2,371*000 entries during
the year 19U3 to the accounts of our member hanks,
as compared with 2,379*000 entries during the year
19l - a decrease of approximately .3$. Hie number
*2
of active accounts at the end of the year 19^3 stood
at 759* representing 89% of the total head office
territory membership as of that date. This compared
with 733 active accounts at the end of 19^2 .
Federal Reserve Books Division
Effected 2,030,000 entries during the year 19^3 in
maintaining accounts with other Federal Reserve
banks and branches and with our Detroit Branch. This
compared with 2,082,000 entries effected during 19^2,
and represented a decrease of 2$ over that year.
The decrease in the actual number of entries func­
tioned, however, was more than offset by a continua­
tion of the conditions experienced in 19^2, involv­
ing the necessity of investigating and adjusting
errors due for the most part to inexperienced help
in the offices of banks originating cash letters
sent to us for credit in other districts.
General Books Division
Effected 33^*700 entries during the year 19^3* com­
pared with 278,900 during the year 19^2 - an increase
of 205t the greater part of which occurred in connec­
,
tion with activities in the account of U.S.Treasurer.
BANK EXAMINATION
DEPARTMENT:
Record of Examinations
Tfiim har

Of BftrikH
Regular - State member banks - Joint with State Examiners
Regular - State member banks - Independent
Membership - Joint with State Examiners
Membership - Independent
Follow-Up Investigations - Joint with State Examiners
Follow-Up Investigations - Independent
Nonmember banks - Independent
Total
Trust Departments - State member banks - Joint with
State Examiners
Trust Departments - State member banks - Independent
Trust Departments - Membership - Joint with State Examiners
Trust Departments - Membership - Independent
Total

377

2
12

16
2

lh
2
1*25
103

5
6

117

-2-

All State member banks and their trust departments
vere examined during the calendar year of 19^3 with
the exception of nineteen banks. Failure to examine
them was due to the fact that the State Departments
were unable to complete their schedules and we felt
it more practical to defer examining these banks until
after January 1, 1 9 ^ , when Joint examinations could
be made.

BANK EXAMINATION
DEPARTMENT:
(Continued)

Applications for State Bank Membership
Acted upon or in Process
Applications approved - Admitted to membership
Applications approved - Incomplete
Applications pending in Chicago on December 31, 19^3

32
1
_2
25

On the application "approved - incomplete" time for
admission has been extended to January 15, 1 9 ^ .
There should be no difficulty in completing the two
applications now pending in Chicago.

Changes in State Bank Membership during the Year
Number of State member banks as of December 31> 19^2
New State Members
Withdrawals

392
32
_8

Number of State member banks as of December 31> 19^3

Ul6

New State Members - 32
Illinois
Bloomington
Chicago
Forest Park
Grayslake
Hammond
Hartsburg
Knltf
Aff-l
Latham
Melvin
Newman
Sidell
Winnetka

American State Bank of Bloomington,Illinois
Austin State Bank
First State Bank of Forest Park
First State Bank of Grayslake
The State Bank of Hammond
Hartsburg State Bank
Kansas State Bank
State Bank of Latham
Commercial State Bank of Melvin
First State Bank of Newman
Sidell State Bank
Winnetka Trust and Savings Bank

-3BANK EXAMINATION
DEPARTMENT:
(Continued)

Nev State Members
Indiana
Akron
Clay City
Columbus
Fort Wayne
Medaryville
North Manchester
Sunman

The State Bank of Akron
Farmers and Merchants Bank
Irwin-Unlon Trust Company
Dime Trust and Savings Bank
The Medaryville State Bank
Indiana Lawrence Bank and Trust Company
Peoples Bank and Trust Company

Iowa
Columbus Junction
Des Moines
Farnhamville
Lake View
Renvick
Waterloo

Columbus Junction State Bank
Capital City State Bank
Security Savings Bank
Farmers State Bank
Renwick Savings Bank
The Waterloo Savings Bank

Michigan
Centreville
Leslie
Lincoln Park
Saline

The Wolf Bros. State Bank
Centreville, Michigan
The Peoples Bank of Leslie
The State Savings Bank of Lincoln Park,
Michigan
The Saline Savings Bank

Wisconsin
Brodhead
Greenwood
Howards Grove
Withdrawals -

The Bank of Brodhead
Farmers and Merchants Bank
State Bank of Howards Grove

8

Chicago

Illinois

Austin State Bank
Converted into a National bank on
November 27, 19^3

Chicago

Illinois

Lake Shore Trust and Savings Bank
Converted into a National, bank on
December 1, 19^3

-4BANK EXAMINATION
DEPARTMENT:
(Continued)

Withdrawals
Metamora

Illinois

Metamora State Bank
Converted into a National bank
on August 25, 19^3

Battle Ground

Indiana

The Battle Ground State Bank
Voluntary liquidation June 30, 19^3

Gary

Indiana

The Gary State Bank
Converted into a National bank
on August 17 ) 19^3

Maquoketa

Iowa

Jackson State Savings Bank
Voluntary withdrawal June 30, 1<43

Niles

Michigan

State Bank of Niles
Voluntary liquidation June 30, 19^3
Assets purchased by First National
Bank of Niles

South Haven

Michigan

The First State Bank of South Haven and
The Citizens State Bank of South
Haven merged June 1, 19^3* under
charter of The Citizens State Bank
of South Haven, and changed title
to Bank of South Haven.

NATIONAL

BANKS

Total number of National banks as of December 31> 19^2
Additions during the year
Withdrawals during the year
Total number of National banks as of December 31> 19^3

533
7
__2
538

Additions - 7
Chicago

Illinois

Lake Shore National Bank, December 1, 19^3
A conversion of Lake Shore Trust and
Savings Bank (member).

Chicago

Illinois

National Bank of Austin, November 27, I9U3
A conversion of Austin State Bank
(member).

Chicago

Illinois

University National Bank, April $0, 19^3
A conversion of University State Bank
(nonmember).

-5BANK EXAMINATION
DEPARTMENT:
(Continued)

Additions
Maywood

Illinois

First National Bank of Maywood
September 7> 19^3
New organization

Metamora

Illinois

Metamora National Bank, August 2k, 19^3
Conversion of Metamora State
Bank (member)

Riverside

Illinois

Riverside National Bank
September JO, 19^3
Conversion of Riverside State
Bank (nonmember)

Gary

Indiana

Gary National Bank, August 18, 19^3
Conversion of The Gary State Bank
(member)

Hume

Illinois

The First National Bank of Hume
April Ik, I9U5
Voluntary liquidation

Fennimore

Wisconsin

The First National Bank in Fennimore
December 21, 19^3
Voluntary liquidation. Succeeded by
The First State Bank (nonmember)

Withdrawals - 2

BANK RELATIONS
DEPARTMENT:

During the calendar year 19^3, calls, other than
scheduled examinations, Mere made on National banks,
State member banks, State nonmember banks and group
meetings by the Baiik Relations Department, and staff
of examiners and assistant examiners, as follows:
National banks
State member banks
State nonmember banks
Group meetings
Conferences
Special investigations

191

108
290
32

kl
■_k
666

During the year addresses were made before
trade associations, credit associations,
bankers associations, credit uni chi associa-

-6-

tions, finance companies, clubs and various other
organizations, as follows:

BANK RELATIONS
DEPARTMENT:
(Continued)

Credit Department - Regulation V
Consumer Credit Department - Regulation ¥
Research and Statistics Department

3
17
335
555

BINDERY AND OLD
RECORDS DIVISION:

In the Bindery section 15,500 Jobs involving several
hundred high-grade cloth-bindings of magazines and
pamphlets, repairs of Library books, and simple bind­
ings of bank records were completed during 19^3 , an
increase of 25$ over 19k2. As for Old Records, at the
end of 19k2 we had a storage capacity of 2k , 000 units,
(the unit equalling one ordinary file drawer), and dur­
ing the year this was increased to 31/500 units through
the acquisition of 7/200 sq. ft. of additional outside
storage space, in at least partial anticipation of the
enormous volume of storage in the making. At the end
of 19k3 our material in storage equaled 26,856 units.
Our Obstruction Schedule in peace time provided a turn­
over of stored bank records which left space require­
ments more or less static, but the Fiscal Agency records
arising out of war financing have created a problem, as
will be seen from the fact that though we have doubled
our storage capacity in the last two years it is already
85$ absorbed.

B U H D I N G DEPARTMENT:

The building organization has been most active in pro­
viding space for the expansion and changes incident to
Fiscal Agency and like operations. As will be seen
from the tabulation, 100,000 sq. ft., the equivalent
of nearly six floors of our building, are being rented
in four outside buildings. Reimbursement from the
Treasury and other government divisions is being re­
ceived for about 75$ of all space used, an indication
of the extent to which this bank is serving the war
effort.*

Sq. ft. Used
Owned
Rented

*

- 230 S. LaSalle
- 120 S. LaSalle
166 W. Jackson
725 S. Wells (Warehouse)
523 S. Plymouth Court
(Warehouse)
Security Trust Building
Indianapolis, Indiana

*

2k3,963

78,201
12 ,k0k
6,000

Reimbursed
by Agencies
ft.)
169/617

78,201
9/553

3/595

____m
3^k,36l

257/371

The Federal Reserve Building contains 307,138 sq. ft., the differ­
ence 63,175 sq. ft. being rented, mostly on long term leases, to
k tenants.

-7-

We are co-operating with government efforts to
preserve material and labor and have accordingly
restricted ourselves to necessary alterations
and to improvements calculated to Increase effi­
ciency by relieving eye-strain and reducing noise.

BUILDING DEPARTMENT:
(Continued)

Recommendations for post-var renovation,at pres­
ent necessarily broadly outlined, have been pre­
sented to our management and reserves have been
set aside from this year's earning to carry out
the program.

The Cafeteria and Dining Rooms served a daily
average of 2,187 meals during the year 19*43;
against 1,336 in 19* . Of this apparent increase
42
about *450 meals are accounted for daily by the
late afternoon light lunches inaugurated toward
the end of 19* . The average Cafeteria check
42
continued as in the past several years at about
23 cents. We have been able to continue the
service for 25 cents of full meals consisting of
meat and potatoes, bread and butter, dessert and
beverage. We absorbed $25;629.91 of the expenses
or 15.9# in 19^3> against $20,887.52 or 17.8* in
19*42. We served 660,^33-meals in 19*0; against
*401,000 in the previous year.

CAFETERIA:

CASH DEPARTMENT:

r

The dollar value of currency paid out during the
year 19*0 amounted to $ 2,183;623,500 as compared
with $1,933; 3^5; 000 during the year 19*42 - an
increase of 13*.

The number of pieces of currency paid out during
the year 19*0 amounted to 398,0*46,*486 as compared
with 385; 375;*^93 during 19*42 - an increase of 3*.
The dollar value of currency received and counted
during the year 19*0 amounted to $1 ;823,521,756 as
compared with $ 1 , * * ;616,013 during 19 4 2 - an in­
544
*crease of 18*.
The number of pieces of currency received and
counted during the year 19*4-3 amounted to 381,221,759
as compared with 35*4; 058,17*4 during 19*42 - an in­
crease of 8*.
The dollar value of coin paid out during the year
19*43 amounted to $*47;297;50*4 as compared with
$*41,052,*411 during 19*42 - an increase of 15*.
The number of pieces of coin paid out during the
year 19*43 amounted to 53*4,033;255 as compared with
512; 136;*4 *4 during 1 * - - an increase of *4*.
8
942

-8-

CASH DEPARTMENT:
(Continued)

The dollar value of coin received and counted during
the year 1943 amounted to $34*690,327 as compared
vith $30,729,690 during 1942 - an increase of 13%.
The number of pieces of coin received and counted
during the year 1943 amounted to 366,846,083 as com­
pared vith 361,731*29^ during 1942 - an increase of

1*.
CHECK DEPARTMENT:

This department handled 33*519*038 City Checks dur­
ing the year 1943* with a dollar value amounting to
$30*208*220,000, which Is an increase of 12.06$ in
City Checks handled and 23.08$ in the dollar value of
City Checks handled compared with the year 1942.
The number of Country Checks handled was 125*555*909*
vith a dollar value of $18*208,741*000* which is an
increase of 2.51$ in Country Checks handled and 17.45$
in the dollar value of Country Checks handled* com­
pared with the year 1942.
24,886,274 Government Checks were handled, with a
dollar value of $13*600,079*000, which is an increase
of 100.34$ in Government Checks handled and 77.16$
in the dollar value of Government Checks handled com­
pared with the year 1942.
Total number of checks handled for the year 1943 was
183,961,221, vith a dollar value of $62*017,040,000*
vhich Is an increase of 11.62$ in total checks
handled and 29.95$ in dollar value of total checks
handled compared with the year ‘1942.

CODES AND
TELEGRAMS DIVISION:

During 1943* 866,158 telegrams were handled through
the Chicago relay office of the Federal Reserve Leased
Wires System (the Chicago "turret") as against a total
of 765*15 ^ for the year 1942 - an Increase for 1943 of
13 over 1942.
During 1943* 156,978 telegrams were handled by the
Codes and Telegrams Division of the Federal Reserve
Bank of Chicago, as against a total of 145*775 for
the year 1942 - an increase of 7 .7$ for 1943
over
1942.

COLLECTION DEPARTMENT:

The number of City items handled during the year 1943
was h7 ,925* compared vith 1 9*8l 6 during 1942 - a de­
+
crease of 3 .80$.
The number of Country items handled during the year
191+3 was 252,304, compared with 305*377 during the year
1942 - a decrease of 17.38$.

-9COLLECTION DEPARTMENT:
(Continued)

The number of Coupon and Security transactions
handled during the year 19*0 wan 149,325, com­
pared vith 147,832 during the year 1942 - an
increase of 1.01$.

CONSUMER CREDIT
DEPARTMENT:

The activities of the Consumer Credit Department
during the year of 1943 included the answering of
about 9,000 inquiries regarding particular phases
of the regulation (through correspondence, tele­
phone and personal interview), addressing groups
of registrants on the subject of the regulation,
conducting investigations of the books and records
of approximately 3>467 dealers and vendors in or­
der to determine the extent of their compliance
with the provisions of the regulation and the
licensing of 1,580 registrants under Regulation W,
one-half of which were department stores and con­
tractors .
CORRESPONDENCE: During the year 2,171 letters
were received requiring a direct reply involving
an interpretation of the Regulation or an appli­
cation of interpretations to specific instances.
The 1,235 other written inquiries received were
answered with form letters in most canes. 2,668
letters were written regarding incorrect Registra­
tion Statements received and letters to Registrants
regarding violations disclosed in Investigators'
reports, as well as other letters such as follow­
ups.
Miscellaneous Form Mailings: On May 4, June 14,
and September 9, 1943, form letters were mailed to
credit and trade associations and daily and weekly
publications in connection with three disaster
areas pursuant to Section 8 (h) of Regulation W.
On April 21, June 25, and December 30, 1943, copies
of press releases were mailed to trade associations
and daily and weekly publications concerning the
voluntary surrender by a large loop Jewelry store
of their license under Regulation W, the one week
suspension of the license of the Mitchell Clothing
Company, St. Louis, Missouri, and the revocation
for one week of the license of the Consumers Home
Equipment Company, Detroit, Michigan, under Regu­
lation W, respectively.
In August, 1943, Amendment No. 10 to Regulation W
was forwarded to 35,120 Registrants and 1,292 Credit
Bureaus, Chambers of Commerce and others on our
special mailing list.

-10CONSUMER CREDIT
DEPARTMENT:
(Continued)

Miscellaneous Form M a i l i n g (Continued):
In November, 19^3 > Circular Letter #1183 concerning
the revision of the National Housing Administrator's
Order NHA 60-hB was mailed to 12,069 banks, bankers,
trust companies and others concerned in the Seventh
Federal Reserve District.
SPEAKERS FURNISHED:

During the year the Consumer
Credit Department conducted twenty talks on Regula­
tion W. The meetings were called by various trade
and credit associations for the purpose of enabling
members and other interested individuals to obtain
answers to their problems under Regulation W.
In
these meetings those in attendance were given the
opportunity to submit questions from the floor and
every effort was made to provide the questioner with
a complete and satisfactory answer.
INVESTIGATIVE ACTIVITY: Although there was less cor­
respondence and fewer personal interviews and tele­
phone calls pertaining to interpretations of the
Regulation than during the preceding year, the activ­
ity of the Consumer Credit Department has increased
greatly with respect to conducting investigations.
During the year 6f 19*0> approximately 3
investi­
gations were made, about 1,850 of which disclosed a
total of some 7>822 violations.
There are at the present time 9 men actively engaged
in conducting investigations in this District, 7
working out of the Head Office and 2 out of the De­
troit Branch. In most cases the investigations are
conducted by one investigator; however, where large
organizations are concerned, two or more investiga­
tors conduct the investigation, depending upon the
size of the Registrant. During the past year the ac­
tivities of the large mail order houses and department
stores were investigated by this department.
Over 320 towns were visited by Regulation W investi­
gators for the first time during this past year in
order to obtain almost complete coverage of communi­
ties with population of 2,000 or over.
The investigations disclosed that the violations were
in most cases inadvertent. Where it appeared that the
violations were apparently willful, reinvestigations
of the Registrants Involved were conducted and in most
cases disciplinary letters were written, or the Regis­
trant was called into the bank for a conference. Such
disciplinary action has in most cases been effective
in obtaining compliance.

-11CONSUMER CREDIT
DEPARTMENT:
(Continued)

V

ATTITUDE OF REGISTRANTS: The attitude of Regis­
trants towards investigations has in the most
part been favorable. In this connection 2^5
Registrants have urged the continuance of Regula­
tion V during the post-war period, and only four
have indicated that they would desire to have the
Regulation abolished as soon as conditions permit.
CONTACT WITH OTHER SUPERVISORY AGENCIES: Although
we have maintained continuous, contact with State
and Federal supervisory agencies co-operating in
the Enforcement Program, the activities of these
agencies are admittedly limited in this respect.

V

DISBURSING DEPARTMENT:

Due to a general expansion in activities through­
out the bant and particularly in the Fiscal. Agency
units, operations in this department showed an in­
crease of approximately 60$ in 19^3 over 19^2 .
During the year 19^3* monthly vouchers were sub­
mitted for a total of $^,^9^>500.00 to 37 Govern­
mental agencies or subsidiaries.

DISCOUNT AND CREDIT
DEPARTMENTS:

During 19^3 activities in connection with the
functioning of guarantees on behalf of the War
Department, Navy Department and Maritime Commis­
sion under the provisions of Regulation V con­
tinued in substantial volume. 595 applications
for guarantees were received at the Head Office,
amounting in the aggregate to $713*^2^,kbk. Each
application required special study and analysis.
In some instances it was necessary to make plant
investigations, following which analyses and recom­
mendations were prepared for submission to the
Board of Governors of the Federal Reserve System.
4-58 guarantees were issued during the year in con­
nection with loans aggregating $595>l8**->206. It
should be borne in mind that aside from the new
applications functioned during the year 19^3 there
were outstanding as of January 1, 19^3> 332 guar­
antees aggregating $269,250,973.63. All outstand­
ing guarantees require periodical reviews, both
from the standpoint of progress being made by the
borrower and to determine whether the financing
institution is conforming with the requirements
specified in the guarantee agreement. As the
volume of outstanding guarantees increased, the
burden of the servicing increased proportionately.
During the year 393 guarantees were terminated as
the result of payment of the loans guaranteed.
As of September 1, 19*+3> the latitude for Regula­
tion V guarantees was broadened so as to permit

-12DISCOUNT AND CREDIT
DEPARTMENTS:
(Continued)

entering into commitments for loans to manufactur­
ers who theretofore had "been considered ineligible
because they had adequate working capital of their
own. The purpose of this broadened latitude was to
enable such manufacturers to arrange for a credit
commitment which would enable them to release their
own investment of working capital from cancelled
contracts. This broadened latitude is generally re­
ferred to as the "7T" guarantee.
Advances to Member Banks: During the year five dif­
ferent member banks had occasion to borrow on their
own notes secured by Government bonds. These banks
borrowed on twenty different occasions in amounts
aggregating $22,332,000.

FEDERAL RESERVE
NOTE ISSUE DEPARTMENT:

Federal Reserve Notes received from Washington by
the Federal Reserve Agent amounted to $961,500,000,
an increase of 13 .7% compared with the amount re­
ceived in the year 19^2 .
Federal Reserve Notes issued to the Federal Reserve
Bank of Chicago by the Federal Reserve Agent amount­
ed to $893)010,000, an increase of 7 *5# compared with
the amount issued during the year 19^2 .

CAPITAL STOCK
Paid-In
Capital
$17,915,750

Increase
Number of adjustments
in stock holdings due
to increases in capital
and surplus
Number of adjustments
due to decrease in
capital and surplus

FILES DEPARTMENT:

95^
925

* 1.609.800

December 31, 19^3
December 31, 19^2

No. of
Members

M

6^5

20

This department was operating until April 1, 19^3,
as a general files, receiving from any division of
the bank papers which for efficiency were thus made
available in one place to auditors, checkers, and the
like. However, with the opening in another building
of our Fiscal Agency Annex and the enormous expansion

-13-

FILES DEPARTMENT:
(Continued.)

in security issues a separate Redemption File
Department was established at 120 South LaSalle
and another independent file department was es­
tablished for the Issuing Agents Division.

FOREIGN FUNDS
CONTROL DIVISION:
License Division
Received
Applications for license under Executive Order

8589

3»6l7

Acted on by Federal Reserve Bank of Chicago
Forwarded to Washington for action

Census Division
Reports on Form TFR-500, foreign-owned property
subject to the Jurisdiction of the U.S.
Processed and forwarded to Washington

Reports on Form TFR-500> relating to property
in foreign countries in which persons subject
to the Jurisdiction of the U.S. had an interest

27 .*644

Processed and forwarded to Washington

Other miscellaneous activities included distribu­
tion on behalf of the Treasury of over 700,000
copies of forms, circulars and other public docu­
ments relating to Foreign Funds Control.

GOVERNMENT BOND
DEPARTMENT:

The operations of the Government Bond Department
for the year 19*0 continued to show considerable
expansion, the larger portions of which are re­
flected in the handling of War Savings Bonds for
redemption, the processing of applications and
the issuance of securities in connection with the
Second and Third War Loan drives as well as the
continued servicing of 4,500 issuing agents in
connection with the sale of Series E War Savings
Bonds.
The dollar value of subscriptions to the Second
and Third War Loan drives, exclusive of sales to
commercial banks for their own account, amounted
to $1 ,772,000,000 and $2,485,000,000 respectively.

-l^-

G-OVERNMENT BOND
DEPARTMENT:
(Continued)

The comparative figures for 1943 with the year 194-2
follow:

U. S. SAVINGS BONDS REDEEMED
ALL SERIES

1942

1243.
Total number of Pieces
Maturity Value
Total Number of Checks Issued

$

7 ,878,000
301,805,000 $

1,375,000

88,230,000
807,000

3,540,000

$ of
Increase
473.£
242.$
339.$

aasiiHi
red:
OTHER BONDS/NOTES/CERT./BILLS
Maturity Value:
Coupon Form
Regis. Form

$
$

7,004,967,000 $
899,720,000 $

2,649,150,000
340,280,000

164.$
164.$

2 ,190,000
74,260,000

59.$

1 ,073,000

12 .$

$ 23,670,750,000 $

13 ,887,700,000

70.$

$ 12,904,640,000 $

9,384,000,000

38.$

14,419,000
873,695,000

80.$
60.$

136,000
81,000
583,067,000

- 32.$
9.$
27 .$

COUPONS REDEEMED
Number of Pieces
Dollar Value

$

2 ,279,000
118,164,000 $
NEW ISSUES

Number of Subscriptions
and Applications Received
Amount of Subscriptions
and Applications Received
Amount of Subscriptions
and Applications Allotted

1 ,200,000

SERIES E SAVINGS BONDS
SALES BY ISSUING AGENTS
Number of Pieces
Maturity Value

25,998,000
$

1,399,654,000 $

DENOMINATIONAL EXCHANGES
MARKETABLE ISSUES
Number of Pieces Received
Number of Pieces Issued
Maturity Value

93,000
88,000
$

741,900,000

$

-15-

GOVERNMENT BOND
DEPARTMENT:
(Continued)
1943

$ 0f
Increase

1942

C.P.D. TRANSACTIONS
Number of Pieces Received
for Transfer
Maturity Value
Number of Pieces Issued
on Transfer
Maturity Value

$

24,000
36,000
1 ,909,605,000 $ 1 ,122,766,000

$

21,000
1 ,19^ 676,000 $

16,100
655,953,000

50.$
70.$

30.5
6
82 .,
j

WAR LOAN DEPOSIT ACCOUNT
Number of Active Qualified
Depositaries
Depositary Bank Balances
(December 31)

450

198.56

1 ,199,900,000 $ 1 ,018,832,000

18.56

1,342
$

BOND CUSTODIAN
Number of Pieces Received
from Treasury Department
Number of Pieces Prepared
for Delivery

32,494,000

19 ,596,000

66.56

28,365,000

16 ,900,000

68.56

744,000

259.56

18 ,166,000

58.$

INCOMING REGISTERED MAIL
Number of Pieces of
Mail Received

2,674,000

SHIPPING AND DELIVERY
Number of Pieces Shipped

INVESTMENT DEPARTMENT:

28,780,000

The tremendous expansion in the total transac­
tions during the calendar year.1943 is obviously
due to the popularity with hanks in Chicago, De­
troit and elsewhere in the district of the ar­
rangement for the sale of Treasury hills to us
under repurchase agreement, which was instituted
in the latter part of 1942. In the early part of
the year, the privilege was availed of principally
hy a dozen or so large hanks here and in Detroit.
However, during the year more and more hanks in
other cities became familiar with the value to
them of the service offered, and transactions

-16-

INVESTMENT DEPARTMENT:
(Continued)

.

were executed for the account of many more member
banks.
It 1b expected that this trend will con­
tinue in 1944.
There was also a noticeable increase in the purchase
of other Government securities for member banks, par­
ticularly in the later months of the year, as banks
had recourse to the market for their investments in
Government securities due to their exclusion from
subscription privileges in the Treasury offerings.

U. S. SECURITIES PURCHASED
Transactions

ishi

121*2

3201
168

1550
89
15
36

A m o u n t

13
31
1478
4891

-21

1942

l2hl
Member Banks and Others
Other Federal Reserve Banks
Retirement System
System Open Market Account
Repurchase Agreement

1765

$

s

83,70^,170 $ 26,964,900
1,480,050
3,538,025
19 ,850,000
9,110,000
122,026,000 161 ,752,000

7,396,884,000
$7,626,002,195

751,620,000
$950,926,950

OTHER SECURITIES PURCHASED
38

49

-11

-21

77

Member Banks and Others
Retirement System

122

$
$

266,500 $
i/57^poo
1,841,500

186,500
1 ,283,000

$

1,469,500

$

18 ,205,230

U. S. SECURITIES SOLD
5356
194
3
949
547
7049

5485

290
16
5
74
a m

Member Banks and Others
$
64,988,225
Other Federal Reserve Banks
1,789,875
Retirement System
7 ,300,000
System Open Market Account
Repurchase Agreement
5,278,589,000
Repurchase Agreement (Matured) 1,645,567.000
$6,998,234,100

1,379,850
10,475,000
44,000,000
633,455,000

-

—

$707,515,080

OTHER SECURITIES SOLD
129
1
11
1^1

208
4
11

Member Banks and Others
Other Federal Reserve Banks
Retirement System

$

$

328,050
20,000
528,000
876,050

$

$

596,000
2,700
344,000
942,700

-17-

LEGAL DEPARTMENT:

There has been a substantial increase in the work
of this department during 1943 > primarily as a re­
sult of the leasing of additional office space,
the large volume of legal questions arising from
War Manpower, Selective Service and Salary Stabi­
lization regulations; also as a result of the
extension of Bank’s Fiscal Agency functions and
enforcement proceedings under Regulation W.
Numerous conferences with and written opinions
prepared for officers and heads of operating de­
partments concerning various legal problems.
Practically all of the legal work of the Detroit
Branch was handled by this department.
This department examined and approved applications
of national banks to exercise fiduciary powers and
all applications for membership and other documents
evidencing changes in corporate status of state
member banks and trust companies. Extensive cor­
respondence with member banks concerning regula­
tions and rulings of the Board of Governors and
other legal matters was carried on.
This department prepared about 450 Guarantee Agree­
ments involving nearly $400,000,000 and also a
large number of supplements to outstanding Guaran­
tee Agreements for this Bank as Fiscal Agent for
the War Department, Navy Department, and Maritime
Commission, pursuant to President's Executive Order
No. 9 H 2 and Regulation V. In this connection, nu­
merous loan agreements between banks and their bor­
rowers were examined by this department.

MAIL DIVISION:

Increases reported last year continued at an accel­
erated pace during 194-3 due to the servicing of
government securities, the circulating of advertis­
ing material in the War Loan Drives, and the opera­
tions of Foreign Funds Control, Regulation W, Army
Savings Bond Custodianship, Ration Banking, and
Withheld Tax. Incoming mail received during 1943
totaled about 3 f
> 300,000 pieces, an increase of 50$
over 1942; while outgoing mail dispatched totaled
9,200,000 pieces, an increase of ll4$. The outlay
for postage was $334,000 this year against $165,000
last year, with reimbursement by the Treasury of
about $206,000 of this year's postage against the
amount of $84,000 for last year.

MEMBER BANK
ACCOUNTS DIVISION:

Analyses reflected 192 deficiencies in reserves of
122 member banks (Head Office territory) for com­
putation periods ending in the year 194-3. Penalties

-18-

MEMBER BANK
ACCOUNTS DIVISION:
(continued)

covering these deficiencies amounted to $3>3*+9.66,
and were assessed in accordance with regulations.
Comparative figures for computation periods ending
in the year 19*+2 reflected 88 deficiencies in the
accounts of 65 member hanks and the amount involved
was $1,067.2*+. The maximum number of penalties
assessed against any one bank during 19*0 was seven
(in one instance), as against five (in one instance)
for 19*+2.
The reserves of all member banks in the Seventh Dis­
trict for the year 19* > adjusted on the basis of
0
semi-monthly periods, reflected a maximum excess over
requirements of $3*O>000,000 or 22.67$ for the period
April 16-30, and a minimum excess of $156,000,000 or
8.79$ for the period December 1-15. Maximum and mini­
mum excess reserves over requirements for the year
19*+2 were $ 527,000,000 or 37.82$, and $255,000,000 or
l6.8l$, and occurred during the periods January 16-31
and October 16-31 respectively.
There were no changes during 19*+3 in the per cent of
demand and time deposits of member banks constituting
their reserve requirements. A new law, however, be­
came effective April 13, 19*+3> providing that until
six months after the cessation of hostilities in the
present War as determined by Proclamation of the
President, or concurrent resolution of the Congress,
no deposit payable to the United States by any member
bank arising solely as the result of subscriptions
made by or through such member bank for United States
Government securities issued under authority of the
Second Liberty Bond Act as amended, shall be included
in net demand deposits or in time deposits which are
subject to reserve requirements.

OFFICE MACHINE
REPAIRS:

The work of this division increased substantially dur­
ing 19*+3 over 19*+2, due principally to a large in­
crease in the amount of purchased and rented mechani­
cal equipment in use which is maintained and serviced.
The skill of the employees of this division, and their
value to the bank, is further emphasized by the fact
that in order to keep important mechanical equipment In
continuous operation, it has been often necessary for
these men to improvise parts when replacements were not
available at the suppliers.

PERSONNEL DEPARTMENT:

Since September 1, 19*+0,
enter military service -

296 employees have left to
27* men and 22 women.
+

-19-

PERSONNEL DEPARTMENT:
(Continued)

During the year of 19*Q:
2,420 persons were hired and
ploy, a net increase of 699.
turnover 55 .1 $.

1,721 left our em­
The percentage of

71 loans were granted to 6l employees totaling
$8,881.74. As of December 31, 194-3, there were
outstanding 54 loans to 49 employees, totaling
$4,568.57.
203 students were enrolled in a typing class.
Classes were conducted for 4 hours each Satur­
day morning.
Arrangements were made to train
similar manner.

55 pages in a

93 students were enrolled in a typing class, and
were in training 5 days a week for a total of
35 hours.
There was instituted in the hank the Joh Instruc­
tion Program of the Training Within Industry Sec­
tion of the War Manpower Commission. This program
consists of a group of 12 employees participating
in 5 two-hour sessions on alternate week-days un­
der an instructor furnished without cost to the
hank hy the State Department of Education. We were
able to accommodate no more than two groups on
any one day and as a result, 48 employees finished
the Joh Instruction Program in the first two-weeks*
program designated for our purposes as Flight 1.
By the end of the year 8 additional groups (Flights
2 and 3 ) or a total of 134 employees had completed
the Joh Instruction Training. A follow-up session
for 4 employees was conducted in the hank hy the
War Manpower Commission on December 15th.
In addition twenty completed a course in Joh Re­
lations provided hy the Training Within Industry
Section of the War Manpower Commission. This in­
cluded officers, supervisors, and key men.
The Medical Department examined 2,755 prospective
employees, administered treatment to 26,864, and
visited 1,452 employees absent because of illness.
Men

Women

Total

Annual Salaries

901

1,556
63.3$

2,457

$3,959,191.00

2,206

3,121

$5,323,629.00

Employees as of:
December 31, 1942
$ of Total

56.7$

December 31, 1943
$ of Total

915
29.5$

70.7$

-20PLANNING DEPARTMENT:

During the early part of this year a recommendation
vas made by the Planning Department to change the
procedure used by our Government Bond Department in
handling Weir Savings Bonds received for redemption.
The recommended change vas made in the month of June
at the Chicago Office and in the month of August at
our Detroit Branch.
The actual saving in expense from the time this plan
vas placed in operation until December 31 of this year,
in both offices, is in excess of $300>000. Based on
our present volume of redemptions, the saving in ex­
pense on a yearly basis is estimated at over a million
dollars.
The nev system eliminated the typing, checking and
filing of redemption forms, and at the same time ex­
pedited the issuance of checks mailed in payment 6f
bonds redeemed. The personnel, space and equipment
problems vere relieved to a large extent, in our Re­
demption Unit, by the adoption of the nev plan.
The cost, at the Chicago Office, of handling War Sav­
ings Bonds received for redemption, shove a reduction
of $66.86 (or ^9.^$) per thousand in the month of De­
cember compared vith the cost for the month of May
(vhich vas the last month previous to adoption of the
nev procedure).
A plan vas vorked out, vith the co-operation of the
Assistant to the Register of the Treasury, vhereby the
vork of tventy-four clerks in our Numerical Sorting
Unit of the Government Bond Department vas eliminated.
In this connection a manual of operations vas prepared
by the Planning Department vhich received very favor­
able comment from the Assistant to the Register of the
Treasury, and a number of officials of other Federal
Reserve Banks vho requested copies of the Manual.
The Planning Department, for some time past, has been
developing jointly vith the Treasury Department an
overall system for the recording of redeemed War Sav­
ings Bond numbers. During the year a portion of this
plan vas put into operation and as a result a force of
300 employees vill be made available for use in other
divisions of the Treasury Department.
The payroll records and procedure of our Personnal De­
partment vere revised to provide for the nev vithholding tax vhich vas inaugurated during the year. Changes
vere also made in the methods of handling and computing
overtime payments and the payroll vas transferred from
a cash to a check distribution basis.
The construction of accounting systems capable of carry­
ing the hank's huge volume in the most efficient manner

-21-

PLANNING DEPARTMENT:
(Continued)

necessarily requires considerable development work,
and during the past year some time was spent on such
projects. Research was started along lines that will
yield results in the post-war period when new types
of equipment and new technique are available to us.
The routine work in the department, like most of the
work in the bank, increased considerably.

PURCHASING DEPARTMENT:

During the year 19^3> this department issued 10,353
purchase orders totaling approximately $900,000 for
building and office supplies, printing and station­
ery, furniture and equipment, and for such other
expenses as were necessary to the conduct of our
business. These figures compared with 8,455 orders
with a dollar value of $620,000 during 1942, and
represent an increase of 22$ in the number of or­
ders and 45$ in the dollar value over that year.
As in 19^2, this increase in the dollar ■value in ex­
penditures consisted mostly of the cost of furniture
and equipment, printing and other supplies used in
connection with the greatly expanded and new Fiscal
Agency functions. Building alterations, greater ac­
tivities in various departments of the bank, and a
moderate increase in inventories, also helped to ac­
count for a smaller portion of the increased cost.
Prices remained fairly stable throughout the year.
The expansion described above was reflected in great­
ly increased activities in the related Stock Room,
Print Shop, and Addressograph sections, which also
were particularly affected by Treasury financing and
related transactions.

RATION CHECK
DEPARTMENT:

This department was organized in the month of Febru­
ary, 1943, to function the clearance of ration checks
and handled 7 ,780,588 ration checks during the year.

R.F.C. CUSTODY
DIVISION:

The RFC Custody Division, acting as Custodian and
Fiscal Agent for the Reconstruction Finance Corpora­
tion and through it for various subsidiary and af­
filiated corporations, made disbursements during the
year 1943 aggregating $2 ,261,000,000, compared to
disbursements in 1942 of $1,274,000,000.
Receipts
in 1943 aggregated $554,000,000 or more than double
the receipts of $250,000,000 in 1942. The increased
volume of disbursements is accounted for largely by
increased activities for Defense Supplies Corpora­
tion in connection with their Alcohol Purchase Program
and payments made for their account in connection

-22-

R.F.C. CUSTODY
DIVISION:
(Continued)

with butter and meat subsidies. Activities of Com­
modity Credit Corporation also accounted for substan­
tial increase in volume. There are some 55 programs
maintained for Commodity Credit Corporation, but the
principal volume was in connection with Dairy Products
Purchase Program covering butter and cheese and the
Lend-Lease Program. The Soybean Program was also a
large factor in the increased activity.
A new unit, Defense Plant Corporation Analysis Section,
was formed in January 19^3 to take over certain work
which had previously been handled by the Washington
office of the Reconstruction Finance Corporation. This
work involved the analysis, preparation and mainten­
ance of accounting records and the establishing of an
inventory control in connection with all machinery
and equipment located in various plants of the Defense
Plant Corporation assigned to this Custodian. There
are 280 of these industrial plants on which these rec­
ords are being maintained.
Defense Supplies Corporation disbursements increased
approximately 950$. Some twenty programs were added
in connection with Defense Supplies Corporation. These
additional programs have substantially added to the
work of the Division because the nature of the pro­
grams required not only the work of making disburse^ments but required considerable additional work in the
nature of verification, audit, and maintenance of in­
ventory records.

RESEARCH AND
STATISTICS DEPARTMENT:

During 19^3 the Research and Statistics Department
stressed in its studies the impact of war upon the
Seventh District economy and probable post-war adjust­
ments. The personnel of the Department was further
strengthened through additions to the staff and through
training of employees.
A series of studies of leading industries in the Seventh
District received major attention. These studies cover
the structure of the given industry, the impact of the
war, prospects for post-war markets, financial position
of firms in the industry, reconversion problems, and
the role of the industry in the national economy, par­
ticularly from the standpoint of achievement and main­
tenance of a high volume of productive employment by
private enterprise. The first such study, the machine
tool industry survey, has been distributed to every
machine tool firm in the country at the request of the
National Machine Tool Builders Association.
Studies were made of wartime trends and post-war prob­
lems in the key cities of the Seventh District. This

-23-

RESEARCH AND
STATISTICS DEPARTMENT:
(Continued)

involves in a sense an integration of all our
research work which hears upon specific areas in
the District.
The survey of country hanker opinion as to farm land
values and farm credit conditions became known thruout the nation as the outstanding source of such in­
formation for this part of the country. The meeting
of country hankers to discuss food and agricultural
policies, held at the Bank, represented an important
first step in that field of regional leadership.
The Federal Reserve survey of the ownership of de­
mand deposits of individuals and businesses was
initiated as a Seventh District research project.
A thorough study was continued of the factors which
determine the amount and distribution of reserve
funds at Seventh District member banks.
Special emphasis has been placed upon continuing
close contacts by the Research staff as representa­
tives of the Federal Reserve Bank of Chicago with
leaders in industry, trade, agriculture, and bank­
ing. No better way exists for obtaining a thorough
understanding of the basic economic activities
which the banking system serves and upon which it
depends for its existence than establishing such
personal contacts.
No better way exists for
strengthening the work of the Bank an a regional
center of economic information and leadership.

SAFEKEEPING
DEPARTMENT:

The total amount of securities received during
19^3 was $21,625,471,814-4 as compared with a total
of $8,099>080,030 during 1942, an increase of 167%.
Securities released during 1943 amounted to the sum
of $20,228,354,261 as compared with $5,971,081,890
during 1942, an increase of 238. $.
8
Total securities held at close of business Decem­
ber 31* 1943* amounted to $4,497,378,31*4 compared
with $3,096,631,231 as of December 31* 1942, an
increase of 45.2$.
Number of receipts outstanding at close of business
December 31* 1943* was 57*240 as compared with 53*627
as of December 31* 1942, an increase of 6 .7$.
Number of pieces held at close of business Decem­
ber 31* 1943* was 367*829 as compared with 346,908
as of December 31* 1942, an increase of 6$.
Number of coupons detached from securities on cou­
pon maturity dates was 761,571 as compared with
611,918 on December 31 of the respective years 1943
and 1942, an increase of 24-1/2$.

-24-

SAFEKEEPING
DEPARTMENT:
(Continued)

Total amount of coupons detached and credited as of
December 31, 1943, amounted to $61,578*696 as compared
vith $32,063,737 as of December 31* 1942, an increase
of 92^.
War Loan Collateral:
Total amount held for 1*550 member and nonmember
banks participating in War Loan Credit vas the sum
of $1*255*705*575* as at close of business Decem­
ber 31* 1943.

TELEPHONE DIVISION:

Local telephone calls averaged 28,000 per month in
19^3 against 19,000 in 1942. In December, 19^3* 419
terminals vere in operation as compared with 338 in
December, 1942.

VAR BOND CUSTODY
DEPARTMENT:

A new department, designated War Bond Custody Depart­
ment, was organized in April, 1943. This department
provides custody for War Savings Bonds purchased by
the army personnel and issued by the finance officer
of the War Department located at Chicago.
In April we began to accept for safekeeping War Sav­
ings bonds issued by the Army War Bond Office in
Chicago.
During the year, War Savings bonds received from the
War Department amounted to $13*767*675, representing
3^4,642 transactions.
Total amount of War Savings bonds released to service
men during the year amounted to $739*775* representing
12,784 transactions.
Total amount held at close of business December 31,
1943* vas $13,027,900. Outstanding receipts - 322,862.
The custody of War Savings Bonds held by the public
was taken over from the Member Bank Safekeeping De­
partment in the middle of the year.
During the year there were received from individuals
and nonmember banks War Savings bonds in the amount of
$10,089,125 * representing 26,136 transactions.
During the year there were released to individuals and
nonmember banks War Savings bonds amounting to the sum
of $2,425,425, which represented 5*742 transactions.
Total amount of War Savings bonds held at close of
business December 31, 1943* vas $32,977,526. Outstand­
ing receipts - 51 ,213 .

-25-

145 #035 transfere of funds vere made during the
year 1943# compared vlth 144,257 during the year
1942 - an increase of 5 .39$•

WIRE TRANSFER
DIVISION:

The dollar value of the transfers made during the
year 1943 amounted to $34,511 #507>000# compared
with $27 ,011,317,000 during the year 1942 - an
increase of 27 .77$.

WITHHELD TAX
DEPARTMENT:

The Current Tax Payment Act of 1943# approved
June 9, 1943, created the "Withheld Tax" Depart­
ments in Federal Reserve Banks.
Shortly after
July 1, 1943, the Federal Reserve Bank of Chicago
"began to organize its "Withheld Tax" Department
and gradually added to its personnel, keeping
pace vith the Depositary Banks' volume of "With­
held Tax" deposits made with us.
I,6l8 hanks in District No. 7# up to the close of
business December 31# 1943# Lad qualified as De­
positaries for "Withheld Taxes". Remittances re­
ceived by the Federal Reserve Bank of Chicago from
its Depositary Banks, at the close of business
December 31# 1943# amounted to approximately 365
millions of dollars, represented by over 200,000
receipts issued in settlement of "Withheld Tax"
deposits made with them by employers.
A total of 473#200 receipt forms were shipped to
Depositary Banks during the year.

*

*

*

*

*

*

*

-26D E T R O I T

B R A N C H

The year 19^3 has "been significant in that the program to make Detroit a full
service Branch practically has teen completed. The announcement, at the first
of the year of the contemplated plan for Detroit to he a full service unit,was
acclaimed ty the press, on behalf of the community, and by the banks as a most
progressive move. On February 1, a Vice President vas assigned to the Branch.
Ration Check clearings began in February. In July functioning started on With­
held Taxes. In 19^3 these two services were new to other Federal Reserve Banks
as well as to the Detroit Branch.
On October 31 all War Loan Accounts for the district were transferred from
Chicago and since that time these accounts have been serviced in Detroit.
The establishment of an Examining staff in Detroit in April, for the examina­
tion of banks not only in this territory but for the entire southern peninsula
of Michigan, was a very constructive step.
It has given the Branch a much
closer public relations tie up with its member banks.
Detroit having been declared an "acute manpower shortage" area, this Branch
adopted the forty-eight hour work week on April 2, 19^3. On May 11, 19*0> by
its own petition, the Branch was declared an "essential activity.”
\

Additional space amounting to 12,000 sq.. ft., was acquired in May by the pur­
chase of the old Mortgage and Contract Building located at 150 West Fort Street.
This addition, adjoining the main office on the east, was made to relieve the
congested working conditions at 160 West Fort Street and to take care of the ex­
panding business of the Branch. Alterations and renovations were completed in
November, and the building is now in full use. To accommodate expanding Fiscal
Agency activities, six thousand feet of additional space has been rented in the
Transportation Building, adjacent to the Annex at 735 Griswold Street.
In October a Medical Unit was established and equipped. All physical examina­
tions are now made by a doctor on the premises, and a nurse is in attendan ce at
all times.
The following data indicates that, in general, nineteen hundred and forty-three
has been a year of increased activity for the Branch.
ACCOUNTING RESERVES
Considerable progress was made during the year in inducing Detroit city banks
to reduce their excess reserves through the purchase of Bills.
This became
evident after mid-year and the last four months indicated real progress. At the
end of the year excess reserves amounted to only 1.1$.

BANE EXAMINATION DEPARTMENT
This department was established at the Branch in April. In addition to the Branch
territory, coverage from Detroit extends to all the lower peninsula of Michigan,

-27D E T R O I T

B R A N C H

CASH DEPARTMENT
Percentage relation
to 1942 activity
Currency Deposits:

Number of Notes
Amount

85,158,000
$572,9^3,000

3/10 of 1% Dec.
IO5 Inc.
6

Currency Payments:

Number of Notes
Amount

111 ,722,000
$867,876,000

1# Dec.
7$ Inc.

Coin Deposits:

Number of Coins
Amount

$

Number of Coins
Amount

$

Coin Payments:

19 ,82k , 000
1,462,000

122,852,000
9,437,000

15* Inc*_
4-5$ ftec.
21$ Inc.
6$ Inc.

CHECK DEPARTMENT
Number of Items:
City
Country
Government
Total
Dollar amount of checks handled

1 1 ,235,000
15 ,189,000
4,300,000

17$ Inc.
3$ Inc.
98$ Inc.

30,724,000

17$ Inc.

$21,740,720,000

26$ Inc.

Ration Checks O.P.A.
(February-December, inclusive)
ItBms
Representing

V
J r

1 ,126,000
7,684,631,000 units

COLLECTION DEPARTMENT
During the past year the activity in this department has shown a
decrease.
Items handled:
1942
19^3

87,039

67,108

A substantial part of this reduction is in City items.

CONSUMER CREDIT

916 investigations were made during 1943.

-28-

DETROIT

BRANCH

DISCOUNT AMD CREDIT
Practically all efforts in this division vere absorbed in handling "V" and "VT"
loans. Only one industrial advance under 13B, for $250,000, was made, and two
loans to a member amounted to $25,000.
Guaranty Agreements issued under Regulation:
Iyl
tl

98

for

$271 ,661,500

_7

for

258,200,000

105

for

$529,861,500

GOVERNMENT BOND DEPARTMENT
Extensive borrowing by the Federal Government to finance the war has continued
to increase the volume of bond transactions which the Branch as Fiscal Agent,
handles for the Treasury Department.
A continuation of this trend is evident.

1943

Percentage relation
to 1942 activity"*

Market Transactions:
Purchases
Sales
Subscriptions to Government
Securities (Marketable Issues)

817,200
515,500

85$ Inc
83$ Inc

$2,839,511,900

102$ Inc

21$ Dec
42$ Inc

$

Savings Bonds and Tax Notes Issued:
Number
Amount

$

824,050
563,795,700

Savings Bonds Issued by Agents:
Number
Amount

$

596,150,500

N.A.
N.A.

Savings Bonds Shipped to Agents:
Number
Amount

$

15,555,700
655,654,900

N.A.
N.A.

$

7,752,000

$

2,760,300
90,853,000

$

585,489,900

25$ Inc

219,250

4$ Dec

Reissues of Savings Bonds
and Tax Notes:

Number
Amount

Redemptions:
Series E War Savings Bonis: Pieces
Amount
Other Bonds, Tax Notes, Bills,
Notes and Certificates:
Amount
Coupons Paid:
*

Number
N.A.

14,647,200

81,300

313$ Inc
119$ Inc

N.A.
N.A.

Indicates that comparison with year 1942 is not
available because this particular function was
carried on for only a part of that year.

-29D E T R O I T

B R A N C H

PERSONNEL
On December 31, 1943, the personnel of the Branch vas composed of 6 officers
and 690 clerks. This represented an Increase of 1 officer and 139 clerks
over December 1942. To obtain this additional, help, it was necessary to hire
699 persons as separations were 560. Seventy-five per cent of the total em­
ployees now are women.
R. E. C. AGENCIES
With the exception of Defense Plant Corporation, Fiscal Agency activities of
the Reconstruction Finance Corporation and its subsidiaries, or affiliates,
showed no material increases, and in some cases decreases were experienced
during the year.
The increase in activities of the Defense Plant Corporation was due to the
transfer to Detroit of several functions formerly handled by the Washington
office.
These augmented duties have made it necessary to increase the per­
sonnel of this section from 25 persons at the first of the year to 83 per­
sons at the present time.
During 1943, 128,000 checks, totaling $362,800,000 were issued in payment of
invoices tendered for the account of Defense Plant Corporation.

Number
Member Banks:
Receipts Issued
Receipts Released
Balance December 31,1943

Amount

3,350

$381,182,500
383,97^,700
165,080,700

168#
64736

$

4,736,500
547,800
7,360,500

5736
34356

13256

Inc.
Inc.
Inc.

$124,474,800
35,077,700
102,328,800

51936

Inc.

69156

Inc.

2536

Inc.

2,600

War Savings Bonds:
Receipts Issued
Receipts Released
Balance December 31,1943

9,090
1,293

War Loan Collateral:
Receipts Issued
Receipts Released
Balance December 31,1943

250
100

Special Custodies:
Receipts Issued
Receipts Released
Balance December 31,19^-3

200
150

$

6,381,500
4,946,500
5,452,100

to 1942 activity

26
3

Inc.
Inc.
Dec.

2636 Inc.

1836 Dec.
36$ Inc.
6

-30-

D E T R O I T

B R A N C H

WAR LOAM DEPOSITARY B A M S

Amount

Percentage relation
to 19^2 activity

$ 52,
983,300

N.A.

Withdrawals

202,886,700

N.A.

Balance December 31, 19^3

257,^17,^00

N.A.

Deposits

*

*

N.A. - Indicates that comparison with 19^2 is not available
because this particular function was carried on for
only a part of that year.

WITHFETD TAX
Number
Receipts issued by Depositaries

Amount

53,050

$ ^5, ,^ 0 0
2 ^

-31-

FEDERAL RESERVE BANK OF CHICAGO
COMPARATIVE STATEMENT OF EARNINGS AND EXPENSES
Years 1943 and. 1942
1942

19*0
EARNINGS ..........................................

$8,738,325.32

6 590, 508.20

$ *

EXPENSES:
Operating Expenses ............................
$4,794,017*64 .$4,186,455*57
Assessment for Board, ofGovernors ...............
294,208.73
213,773*02
Cost of Federal Reserve Currency ............ .
762,007.20
777*174*36
Total Net Expenses ......................

$5*850,233*57

$5*177,402.95

Current Net Earnings ..........

$2,888,091.75

$1,413*105.25

. . . . .

ADDITIONS TO CURRENT NET EARNINGS:
Profit on Sales of U. S. Government Securities . $4,135*903.91
Other Additions ................................
1*430.59
Total Additions to Current Net Earnings
Total Current Net Earnings and
Additions to Current Net Earnings

. $4,137>334.50

. . .

$

378,310.71
8*538.17

$

386,848.88

$7,025,426.25

$1*799,954.13

Retirement System (increased Benefits to Members) $ 986,400.18
Retirement System (interest Base Adjustment). . .
279*673*00
Reserves for Losses on Industrial Advances. . . . ______ -_____

592*793.00
10,000.00

DEDUCTIONS FROM CURRENT NET EARNINGS:

Total Deductions fromCurrent Net Earnings

$1,266,073*18

Net Earnings...................................... $3*739*333*07

$

602,793*00

$1,197*161.13

DISTRIBUTION OF NET EARNINGS:
Paid United States 'Treasury (Section 13B) . . . .
Dividends Paid ................................
Transferred to Surplus (Section 7)..............

$

50.21
993*684.20
4,765*618.66

$

$5*759*353*07

$1,197*161.13

4,021.06
955,507.94
237*652.15

SURPLUS ACCOUNT (Section 7)
Surplus January 1 .............................. $22,924,752.06 $22,924,752.06
Transferred to Surplus ........................
4 ,765,618.66
237,632.13
Transferred from Surplus to
Reserve for Contingencies....................
1,200,000.00
257,632.13
Surplus December 31

$26,490,370.72 $22,924,752.06

-32-

FEDERAL RESERVE BANK OF CHICAGO
COMPARATIVE STATEMENT OF CONDITION
December 31, 1943 December 31, 1942

A S S E T S

GOLD CERTIFICATES ON HAND AND
DUE FROM U. S. TREASURY ................................. $ 3 , 808 , 3 8 3 , 2 1 0 .7 0
REDEMPTION FUND - FEDERAL RESERVE NOTES. .
19,758,171.97
OTHER CASH ......................................................................
40,409,037-39
Total Reserves ................ $3,868,550,453.06
BILLS DISCOUNTED ........................ $
4,000.00
INDUSTRIAL ADVANCES ....................
4,000.00
Total Bills .................. $
1,393,993,000.00
U. S. GOVERNMENT SECURITIES ............
Total Bills and. Securities . . . $ i,3 9 3 ,9 9 7 ,o o o .o o
BANK PREMISES............................
2,9 4 7,8 63 .09
9,905,9^0.00
FEDERAL RESERVE NOTES OF OTHER BANKS . . .
UNCOLLECTED ITEMS........................
306,817,379.35
OTHER ASSETS ............................
5,823,376.15
Total Assets .................. $ 5 , 588 , 042 , 0 1 1 .6 5

$3,570,030,564.76
1,475,245.00
40,018,518.91
$3,611,524,328.67
$
3 0 5 , 000.00
110,164.66
$
415,164.66
8 7 6 , 894 , 500.00
$ 877,309,664.66
2 ,9 1 6,7 63 .48
6 ,415,500.00
244,938,202.40
10,864,571.65
$4,753,969,030.86

L I A B I L I T I E S
FEDERAL RESERVE NOTES IN ACTUAL
CIRCULATION ..........................
DEPOSITS:
Member Bank - Reserve Account ........
U. S. Treasurer - General Account . . .
Other Deposits ......................
Total Deposits ................
DEFERRED AVAILABILITY ITEMS..............
OTHER LIABILITIES........................
Total Liabilities
C A P I T A L

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

$ 3 , 1 6 3 , 1 9 9 , 8 95.0 0 $2,419,593,470.00
$1,9 43 ,25 0 ,3 4 8.3 9 $ 1,925,895,804.05
56,515,396.47
71,445,225.97
1 5 8 , 000 , 5 3 4 .6 1
89,583,328.63
$ 2 , 1 5 7 , 7 6 6 , 2 7 9 .4 7 $ 2 , 086 , 9 2 4 , 3 5 8 .6 5
2 1 0 , 6 8 7 , 2 5 0 .2 2
197,775,582.81
333,752.66
6 7 1 , 3 0 1 .5 6
$5,532,324,726.25 $4,704,627,164.12

A C C O U N T S

CAPITAL PAID IN..........................
SURPLUS (Section 7)......................
SURPLUS (Section 1JB)....................
OTHER CAPITAL ACCOUNTS ..................
Total Liabilities and.
Capital Accounts ............

$

17,915,750.00 $
2 6 , 490 , 3 7 0 .7 2
1 ,^ 2 9 , 3 8 3 .7 8
9 , 8 8 1 , 78 0 .90

16,305,950.00
2 2 , 9 24 , 7 5 2 .0 6
1 ,^ 2 9 , 3 8 3 .7 8
8 , 6 8 1 , 78 0 .9 0

$5,588,042,011.65 $ ^,7 5 3 ,9 6 9 ,0 3 0 .8 6

-33FEDERAL RESERVE BANK OF CHICAGO
CURRENT EARNINGS, CURRENT EXPENSES, CURRENT NET EARNINGS, ADDITIONS TO CURRENT NET EARNINGS,
DEDUCTIONS FROM CURRENT NET EARNINGS, NET EARNINGS AND DISPOSITION OF NET EARNINGS

EARSI NGS

and

1923
1924
1925
1926
1927
1928
1929
1930
1931
1932
1933
1934
1935
1936
1937
1938
1939
1940
1941
1942
19^3

Current
Earnings
$ 268,885
665,937
2,083,164
8,481,747
1 2 , 012,078
30,303,218
20 , 3 82,170
6 , 748,863
6,511,359
5,202,169
5,424,663
6,567,045
6,167,352
8,936,418
9,889,451
4,834,153
4,143,601
5 , 6 1 3 ,6 7 1
6,764,554
8 , 1 5 2 ,3 7 1
6,177,615
4,423,476
4,575,583
3,954,026
4,254,602
4,831,217
5,089,095
6,590,508
8,738,325

Current
Expenses
$ 245,584
237,731
584,069
1 , 478,310
2,450,244
4,164,176
4,734,100
4,080,057
4,373,024
3,946,436
3,744,039
3,824,437
3 , 887,058
3 , 696,679
4,092,369
3,805,117
3,524,401
3,432,693
3,854,009
3,551,838
3,697,540
3,453,380
3,199,558
3 , 318,002
3,316,352
3,471,164
4,227,534
5,177,403
5,850,233

Current
Net
Earnings
$
23,301
428,206
1,499,095
7,003,437
9,561,834
26,139,042
15,648,070
2 , 668,806
2,138,335
1,255,733
1,680,624
2,742,606
2,280,294
5,239,739
5,797,082
1 , 029,036
619,200
2,180,978
2,919,545
4,600,533
2,480,075
970,096
1,376,025
636,024
938,250
1,360,053
8 6 1 ,5 6 1
1,413,105
2 , 888,092

T otal

$207,787,314

$99,417,537

$108,369,777

Year
1914-15
19 16
1917
1918
1919
1920
19 2 1
1922

DI SP 0S I TI 0 N

EXPENSE S
Additions
to
Current Net
Earnings

Deductions
from
Current Net
Earnings
$
3 ,2 10
25,000
269,343
198,356
985,630

of

NET

E AR NI NGS

T ransferred
to Surplus
(Section 7)
$
215,799
6,200,446
7,875,397
14,688,500
2,075,323
- 657,289
27,398
187,257
1,267,964
897,655
3 , 663,668
3,651,464
- 157,090
- 560,738
1 2 1 ,2 7 9
932,366
669,479
153,241
883,370
279,031
158 ,26 5
1,770,131
100,484
237,632
4 , 7 6 5 ,6 19

17,637
28,354
28,354
20,714
5 ,12 0
10,924
27,215
4,021
50

$

4,137,334

Dividends
Paid
$
361,319
862,259
604,635
700,807
792,769
853,785
876,203
904,371
909.123
934,016
985,959
1,029,990
1,099,761
1,170,363
1,211,418
1,170,633
1,029,933
8 5 8 ,12 7
761,334
753,583
725,553
763,115
791,007
819,532
826,919
896,766
955,508
993,684

T ransferred
Paid U.S.
Treasury to Surplus
(Section 13B)(Section 13B)

157
602,842
1,266,073

Net
Earnings
$ 20,091
403,206
1,231,879
6 , 805,081
8,576,204
25,875,749
14,505,117
1,405,215
1,178,355
909,123
1,121,273
2,253,923
1,927,645
4,763,429
5,424,665
1,054,328
609,895
2,242,725
1,790,493
1,404,491
771,2 2 0
932,178
1 , 687,606
1,090,958
982,917
2,607,974
1,024,465
1,197,161
5,759,353

$15,863,023

$24,676,081

$99,556,719

$24,642,472

$49,446,651

$ 142,589

$

$

-

2,127
69,307
4,826
572,019
41,903
27,857
12,646
13,098
1 3 ,0 6 1
11,833
8,050
298,510
263,967
874,264
373,245
1,611,990
951,304
1 , 526,060
8 1 1 ,1 8 8
1,637,141
521,313
1 , 530 ,0 21
-

16 3 ,0 6 1
386,898

332,600

1,147,779
1 , 8 35,610
1 , 001,883
374,467
571,997
501,781
365,710
488,143
380,467
2 7 3 ,2 18
273,272
812,517
1,493,297
4,808,032
2,660,159
1,563,978
499,607
1 , 182,207
476,646
282,100

Deductions from S urplus(Section 7 )
Purchase of F .D .I.C . Stock Year 1934
T ransferred to Reserves fo r
Contingencies Years
1940, 1942 and 1943

-

$19,748,517
3,207,763

,956,280
$26,490,371
22

$

-

- 26,322
-

-

-

-

25,030

12,767

206

Franchise
Balance
Tax
to
Paid U.S. P ro f it & Loss
$ 20,091
$
41,887
-61,978
215,799
-

-

-

-

-

-

10,394,480
11,576,009
1 , 18 6 ,3 0 1
246,586
602,838
1,091,513
-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

1 1 ,6 8 1

1,417,702*
$ 1,429,383

$25,313,526

$

* Payments from U.S. Treasury
Years 1934 and 1935.

-

t

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