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FEDERAL RESERVE BANK OF CHICAGO

PRESIDENT’S REPORT TO DIRECTORS

ACTIVITIES
FOR THE YEAR 1944

3

• #

PRESIDENT'S REPORT TO DIRECTORS

ACTIVITIES OF THE- HEAD OFFICE AND DETROIT BRANCH
During the Year 1 9 ^

COMPARATIVE STATEMENT OF EARNINGS AND EXPENSES
Years 19kb-19k3

COMPARATIVE STATEMENT OF CONDITION
December
- December 31A9^3
and
STATEMENT OF EARNINGS AND EXPENSES - DISPOSITION OF NET EARNINGS
Years 191^-19^ Inclusive

m

- I N D

E X -

Page
ACCOUNTING DEPARTMENT:
Bookkeeping Division .......................................
Federal Reserve BooksDivision ...............................
General Books D i v i s i o n ........................

1
1
1

BANK EXAMINATION DEPARTMENT............................................
BANK RELATIONS DEPARTMENT..............................................
BINDERY AND OLD RECORDS DIVISION ......................................
BUILDING DEPARTMENT....................................................

1
5
5

CAFETERIA..............................................................
CASH D E P A R T M E N T ......................................................
CHECK DEPARTMENT......................................................
CODES AND TELEGRAMS DIVIS I O N ..........................................
COLLECTION DEPARTMENT.................. ' ..............................
CONSUMER CREDIT DEPARTMENT ............................................

7
7

6

8
9
9
9

DISBURSING DEPARTMENT................................................ .
10
DISCOUNT AND CREDIT DEPARTMENTS.......................................... 10
FEDERAL RESERVE NOTE ISSUE DEPARTMENT.................................... 12
FILES DEPARTMENT........................................................ 12
FOREIGN FUNDS CONTROL DIVISION ........................................
12
GOVERNMENT BOND DEPARTMENT.............................................. 13
INVESTMENT DEPARTMENT.................................................... 17
LEGAL DEPARTMENT........................................................ 17
MAIL DIVISION............................................................ 18
MEMBER BANK ACCOUNTS DIVISION............................................ 19
OFFICE MACHINE REPA I R S .................................................. 19
PERSONNEL DEPARTMENT . ,.................................................. 20
PLANNING DEPARTMENT. . ................................................... 21
PURCHASING DEPARTMENT.................................................... 22
RATION CHECK DEPARTMENT.................................................. 23
R.F.C. and C.C.C. CUSTODY DIVISIONS...................................... 23
RESEARCH DEPARTMENT...................................................... 2b
SAFEKEEPING DEPARTMENT.................................................. 25
TELEPHONE DIVISION...................................................... 25
WAR BOND CUSTODY DEPARTMENT.............................................. 25
WIRE TRANSFER D I V I S I O N .................................................. 26
WITHHELD TAX DEPARTMENT......................
26
DETROIT BRANCH ........................................................

27

COMPARATIVE STATEMENT OF EARNINGS AND EXPENSES - Years 19^-19^3 . . . .
COMPARATIVE STATEMENT OF CONDITION - December 31; 19^-December 31; 19^3.
STATEMENT OF EARNINGS AND EXPENSES - DISPOSITION OF NET EARNINGS
Years 191^ - 19^; Inclusive

3^
35
36

'

,

....

1 2 ....................

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

’

.

-1-

ACCOUNTING
DEPARTMENT:

Bookkeeping Division functioned 2,503,000 entries
during the year 1944 to the accounts of our member
banks. This compared with 2,371*000 entries during
the year 1943 and reflected an increase of 5*6$*
which, for the most part, was due to the handling
of transactions involving United States financing
and redemptions of War Savings Bonds.
The number
of active accounts at the end of the year 1944
stood at 802, representing 92$ of the total head
office territory membership as of that date. This
compared with 759* or 89$ of the active accounts
at the end of 1943•
Federal Reserve Books Division effected 1,919*700
entries during the year 1944 in maintaining ac­
counts with bther Federal Reserve Banks and Branches
and with our Detroit Branch.
This compared with
2 ,030,000 entries effected during 1943 and repre­
sented a decrease of 5.4$ over that year.
The decrease in actual number of entries functioned
was offset to a considerable degree by a continua­
tion of the conditions experienced in 1943 and 1942,
in which the investigation and adjustment of errors
in cash letters sent direct to other districts by
our member banks constituted a substantial part of
the work of the division.
General Books Division functioned 377,400 entries
during the year 19^*
compared with 334,700 during
the year 1943 - an increase of 12 .8$, the greater
part of which occurred in connection with activi­
ties in the account of the United States Treasurer.

BANK EXAMINATION
DEPARTMENT:
Record of Examinations
Number
of Banks
Regular - State member banks - Joint with StateExaminers
Regular - State member banks - Independent
Membership - Joint with State Examiners
Membership - Independent
Follow-up Investigations - Independent
Total
Trust Departments - State member banks - Joint with
State Examiners
'Trust Departments - Independent
Trust Departments - Membership - Joint with State Examiners
Trust Departments - Membership - Independent
Total

428
1
9
18
__2.
465
127
5
4
2
138

-2-

BANK EXAMINATION
DEPARTMENT:
(Continued)

All State member bankB and their trust departments
were examined during the calendar year of 19^4 with
the exception of the Harris Trust and Savings Bank,
Chicago, Illinois, and The Northern Trust Company,
Chicago, Illinois. Arrangements had "been made to con­
duct examinations of these two hanks hut were called
off because the State Department could not complete
their schedule in order to Join u s .

Applications for State Bank Membership
Acted upon or in Process
Applications
Applications
Applications
Applications
Applications

approved - Admitted to membership
approved - Incomplete
withdrawn
pending Washington
pending in Chicago on December 31, 1 9 ^

21
142

1
__jj

Changes in State Bank Membership during the Year
Number of State member banks as of December 31, 19^3
New State members
Withdrawn

21

k

Number of State member banks as of December 31, 19-h-h-

New State Members - 21
Illinois
Colfax
Galesburg
Mansfield
Saybrook
Windsor
Indiana
Hammond
Milford Junction
(P.0.Milford)
Pierceton

Peoples State Bank of Colfax
Bank of Galesburg
People 1s State Bank of Mansfield
State Bank of Saybrook
Windsor State Bank

Mercantile Bank
Citizens State Bank of Milford
Pierceton State Bank

Iowa
Belmond
Manchester
Pocahontas

hl6

First State Bank
Farmers & Merchants Savings Bank
The Commercial State Bank

*<•33

-3BANK EXAMINATION
DEPARTMENT:
(Continued)

Nev State Members
Michigan
The Peoples State Bank of East Tavas, Michigan
Fanners State Bank of Middleville, Michigan
Ypsilanti Savings Bank

East Tavas
Middleville
Ypsilanti
Wisconaln
Brillion
Cleveland
Delavan
Kiel
Orfordville
Racine
Spring Green

Calumet County Bank
Cleveland State Bank
Wisconsin State Bank
The Citizens State Bank
Farmers & Merchants Bank of Orfordville
American Bank and Trust Company
State Bank of Spring Green

Withdrawals - 4
Akron

Indiana

The State Bank of Akron
A voluntary liquidation effective
September 1, 1 9^.

Renwick

Iowa

Renwick Savings Bank
A voluntary withdrawal effective
October 20, 19^-. Objected to
reserve requirements and filing
reports.

Holly

Michigan

First State and Savings Bank of Holly
A voluntary withdrawal November 30,
19Mf. Withdrew from System in order
to establish a branch in neighboring
town.

Lincoln Park

&

4

Michigan

The State Savings Bank of Lincoln Park
Consolidated with Ecorse Savings Bank,
Ecorse, Michigan on June 3> 1 9 ^ > un­
der charter of the latter institution
and under title of Wayne County Bank,
which bank on June 12, 1 9 ^ changed
its title to Ecorse-Lincoln Park Bank.
Now operated as a branch of EcorseLincoln Park Bank.

-4BANK EXAMINATION
DEPARTMENT:
(Continued)

NATIONAL BANKS
Total number of National banks as of December 31> 19*0

538

Additions during the year
Withdrawals during the year

4
__4

Total number of National banks as of December 31> 1944

538

Additions - 4
Chicago

Illinois

Lincoln Security National Bank
A primary organization.

-

7- 1-44

Mason City

Illinois

Mason City National Bank
New organization.

-

10- 3-44

Oak Park

Illinois

Oak Park Nations! Bank
A conversion of Prairie State
Bank, Oak Park, Illinois (non­
member) .

-

12- 30-44

Palatine

Illinois

Palatine National Bank
A primary organization.

-

12 - 2-44

South Bend

Indiana

The City National Bank and Trust Company of
South Bend and The Merchants National Bank of
South Bend consolidated at the close of busi­
ness March 31 j 1944.
The consolidation was
effective under the charter of The City National
Bank and Trust Company of South Bend, and under
the title of "The National Bank and Trust Com­
pany of South Bend."

Keokuk

Iowa

Keokuk National Bank
A Voluntary liquidation.
Absorbed by Security State
Bank, Keokuk (nonmember).

Remsen

Iowa

The First National Bank of Remsen
A voluntary liquidation. Absorbed
by First Trust & Savings Bank,
Remsen (nonmember).

Stuart

Iowa

The First National Bank of Stuart
- 10- 5-44
A voluntary liquidation. Succeeded
by First State Bank,Stuart (nonmember).

Withdrawals - 4

'

- 10- 3-44

2-24-44

-5-

BANK RELATIONS
DEPARTMENT:

During the calendar year 19M+, calls, other than
scheduled examinations, were made on National
hanks, State member hanks, State nonmemher hanks
and group meetings, hy the Bank Relations Depart­
ment, examiners and assistant examiners, as fol­
lows National hanks
State member hanks
State nonmemher hanks
Group meetings
Conferences
Special investigations

178
113
286
25
8
16

626
During the year addresses were made before trade
associations, credit associations, hankers asso­
ciations, credit union associations, finance com­
panies, clubs and various other organizations, as
follows Credit Department - Regulation V
Consumer Credit Department - Regulation W

3
14

Research Department Addresses at bankers meetings

2k

Addresses at other meetings

63

Participation in meetings and
conferences

200

Calls on member hanks or visits
of hankers at the Bank

200

Several thousand inquiries from
hanks, business firms, Government
agencies, etc. were answered.

BINDERY AND OLD
RECORDS DIVISION:

The Bindery Section completed a total of 15>730
cloth bindings of magazines and pamphlets and
simple bindings during 1 9 ^ - a moderate increase
over the 15,000 jobs completed in 19*0• The Old
Records Section completed another extremely active
year, which found our archive space in this build­
ing and two outside warehouses 91$ absorbed. How­
ever, the acquisition of 16,000 square feet of
additional storage space at 326 South Wells Street.*^
will immediately relieve the congestion and is ex-'
pected to provide ample space until early 19^7
when all our leases expire and a clearer view of
the future may be possible.

BUILDING DEPARTMENT:

The need for additional space continued during 1944,
although not at the tempo of 1943 when fourteen sepa­
rate leases for about 62,000 square feet were entered
into. Only two leases, totalling 37>000 square feet,
were made during 1944. One, in the Insurance Exchange
Building, took approximately 21,000 square feet for
the use of the Issuing Agents and Sales Analysis Sec­
tions of the Government Bond Department. This lease,
like others made for the Government Bond Department,
has a clause permitting cancellation by six months'
prior notice on and after eighteen months. The other
lease involved around 16,000 square feet in a ware­
house at 326 South Wells Street for the storage of old
records. This additional storage capacity is designed
for estimated needs through early 1947/ at which time
the lease terminates. It is hoped there will then be
a clearer view on which to base plans for future old
record storage provision.
Tabulated below are owned and rented quarters as of
January 1, 1945:
Owned

Square Feet

230 South LaSalle Streec

243/963*

Rented
120 South LaSalle Street
83,246
166 West Jackson Boulevard
13,600
175 West Jackson Boulevard
20,945
(insurance Exchange Building,South)
725 South Wells Street (Warehouse)
6,000
523 South Plymouth Court (Warehouse)
7/191
326 South Wells Street
(Warehouse)
16,278
Security Trust Building,
Indianapolis, Indiana
198
Total

391.421

* The Federal Reserve Bank Building contains
307,138 square feet, the difference 63/175 /
being rented on term leases to four tenants.
War time restrictions/ as outlined in War Production
Board's Order L-41, continued to confine alterations
to those dictated by utility or improved working con­
ditions for employees. Of the-former, the only ex­
ample is the enlargement o f ‘the Directors' Room to a
capacity of one hundred people, and, of the latter,
the extending of floor covering and acoustical treat­
ment in limited amounts, the equipping of several
lounge rooms for women employees, and the installa­
tion of a music system - all in cooperation with the
departments concerned.

-7-

BUILDING DEPARTMENT:
(Continued)

Ideas for post war renovation are "being kept alive
"by informal conversations among officers and "build­
ing key men. As it becomes timely, the main out­
lines of a renovation plan can promptly be placed
in the hands of the architects and engineers.

CAFETERIA:

There were 687,051 meals served in our cafeteria
and dining rooms during 1944, against 660,433 in
1943. This was a daily average of 2,298 in 1944,
against 2,188 for the year 1943.
Included in
these figures are light lunches served in the late
afternoon and evening, which numbered 519 daily
during 1944, against 450 daily for 1943.
Total cafeteria receipts were $145,379.01. Meals
provided at the expense of the bank totaled 8,415,
of which 1,447 were served to business guests of
our officers, and 6,968 were served to bank em­
ployees on the occasions of our 30th Anniversary
Dinner on November 16, the annual complimentary
Christmas Dinner, and in connection with the spon­
sor program and departmental conferences.
In spite of the rise in prices, we continue to
serve the special cafeteria luncheon, which in­
cludes meat, potatoes, or other vegetable, bread,
butter, dessert, and beverage, for 25 cents. This
year we absorbed $38,868.20, or 21.1$, of the ex­
pense, against $25,629.91> or 15.9$> in. 1943.
To produce a restful atmosphere, the employees*
dining room was redecorated with wall paper and
Venetian blinds, and a contract has recently been
signed for the supplying of music by wire during
meads.

CASH DEPARTMENT:

The dollar value of currency paid out during the
year 1944 amounted to $2,428,013,000 as compared
with $2,183,623,500 during the year 1943 - an in­
crease of 11$.
The number of pieces of currency paid out during
the year 1944 amounted to 405,949,900 as compared
with 398,046,486 during 1943 - an increase of 2$.
The dollar value of currency received and counted
during the year 1944 amounted to $2,030,378,372 as
compared with $1,823,521,756 during 1943 - an in­
crease of 11$.
The number of pieces of currency received and
counted during the year 1944 amounted to 392,812,450
as compared with 381*221,759 during 1943 - an in­
crease of 3$.

-8-

CASH DEPARTMENT:
(Continued)

The dollar value of coin paid out during the year
1944 amounted to $ 50,555,062 as compared vith
$47,297,304 during 1943 - an increase of 7$.
The number of pieces of coin paid out during the
year 1944 amounted to 641,472,086 as compared with
534,033,255 during 1943 - an increase of 20$.
The dollar value of coin received and counted dur­
ing the year 1944 amounted to $36,043,315 as com­
pared with $34,690,327 during 1943 - an increase of
4$.
The number of pieces of coin received and counted
during the year 1944 amounted to 323>457*622 as
compared with 366,846,083 during 1943 - a decrease
of 12$.
The dollar value of coin received from the Mint dur­
ing the year 1944 was $16 ,250,000 as compared with
$12 ,827,000 during 1943 - an increase of 27$.
The number of pieces of coin received from the Mint
during the year 1944 amounted to 340,000,000 as
compared with 161,475,000 during 1943 - an increase
of 111$.

CHECK DEPARTMENT:

This department handled 37*724,128 City Checks dur­
ing the year 1944, with a dollar value amounting to
$33,523,104,000, which is an increase of 12.55$ in
City Checks handled and 10.97$ in the dollar value of
City Checks handled compared with the year 1943.
The number of Country Checks handled was 132,647,312,
with a dollar value of $20,277*356,000, which is an
increase of 5 .65$ in Country Checks handled and 11.36$
in the dollar value of Country Checks handled, com­
pared with the year 1943.
,
38,013,272 Government Checks were handled, with a
dollar value of $15,418,031,000, which is an increase
of 52.75$ in Government Checks handled and 13.37$ in
the dollar value of Government Checks handled compared
with the year 1943.
Total number of checks handled-for the year 1944 was
208,384,712, with a dollar value of $69,218,491,000,
which is an increase of 13.28$ in total checks han­
dled and 1 1 .61$ in dollar value of total checks han­
dled compared with the year 1943.

-9-

CODES AMD
TELEGRAMS DIVISION:

During 19kk, l,Olk,738 telegrams were handled
through the Chicago relay office of the Federal
Reserve Leased Vires System (the Chicago "Turret")
as against a total of 806,158 for the year 19k3 .an increase for 19kk of 17 .2$) over 19^3 .
During 19kk, 163,388 telegrams were handled by the
Codes and Telegrams Division of the Federal Reserve
Bank of Chicago, as against a total of 156,978 for
the year 19^3 - an increase of k.l$ for 19kk over

19^3.
COLLECTION DEPARTMENT:

The number of City items handled during the year
19kk was kl,210, compared with k7,925 during 19^3 a decrease of lk.01$.
The number of Country items handled during the year
19kk was 220,646, compared with 252,30k during the
year 19k3 - a decrease of 12 .55$.
The number of Coupon and Security transactions
handled during the year 19kk was 138,299, compared
with 1 ^9,325 during the year 19^3 - a decrease of
7.38$.

CONSUMER CREDIT
DEPARTMENT:

During 19kk the books and records of 3,k66 dealers
and vendors have been reviewed in order to determine
the extent of conformance of their credit transac­
tions to the provisions of Regulation V and approxi­
mately 8,200 inquiries concerning the Regulations
(through correspondence, telephone, and personal in­
terview) have been answered. In addition, 1,276 new
licenses were issued under the Regulation. The bank,
acting under the authority contained in Section 12(m)
of the Regulation, notified eight department store
Registrants that they were permitted to adopt systems
of cycle billing.
All communities in this District with a population
of 2,000 or over have been visited by an investigator
at least once since the inception of Regulation V and
the records of a representative number of merchants
have been reviewed. Out of 5,k66 investigations con­
ducted during the year 19kk (sales organizations for
the most part), 1,819 disclosed a total of 7 >035 vio- *
latione. A total of’288,195 credit transactions were
reviewed In the investigations. Detailed reports
covering each investigation or reinvestigation were
prepared and are kept on file.
Two hundred and seventy-three towns were visited by
Regulation W investigators during this past year, 57

-10-

COWSUMER CREDIT
DEPARTMENT:
(Continued)

for the first time, and a definite and accelerated
trend from credit to cash sales was noted in nearly
every instance. A large majority of Registrants have
urged that Regulation W "be continued in the post-war
period.
Disciplinary action taken in connection with 52 ap­
parently willful violators has "been confined to let­
ters to the Registrants involved but in 55 cases con­
ferences were held with the Registrants (21 at the
Head Office and 11 at the Detroit Branch); one con­
ference was held at a Registrant’s place of business
(Sheboygan, Wisconsin) since he pleaded that the trip
to Chicago would be of great inconvenience.
Thirteen talks on Regulation W were conducted by the
Consumer Credit Department; seven by the Head Office
and six by the Detroit Branch. The meetings were
arranged by various associations in order that their
members could have clarified any problems they might
have concerning the Regulation.
A part of the meet­
ings was generally devoted to a question and answer
period.
The number of Registrants as of December 51, 1944
was 55#074.

DISBURSING DEPARTMENT:

The operations of this department steadily increased
during the year due to a general, expansion of activi­
ties throughout the bank, particularly in connection
with Fiscal Agency work, and the added function of
prepaying emergency expenses incurred by the State War
Finance Committees in this district on account of War
Loan Drives.
Expense items covering bank operations, for a total
of $5 #904,757 .57, were functioned during the year, as
compared with $5 ,118 ,717*70 for the previous year an increase of 15.4$.
Fiscal Agency expense charges functioned, including
War Finance Committees, for which monthly vouchers
were submitted to 50 Governmental agencies or sub­
sidiaries, totaled $5,197,541.26, as compared with
$4,478,848.48 for the previous year - an increase of

16$.
DISCOUNT AND CREDIT
DEPARTMENTS:

Guarantees under Regulation 7.
Effective September 11, 1944, Regulation V was revised
so as to make available termination protection, pursu­
ant to the intent of the Contract Settlement Act of 1944,

-11-

DISCOUNT AND CREDIT
DEPARTMENTS:
(Continued)

approved July 1, 1 9 ^ • During the year 19^ , *+78 ap­
plications for guarantees were received at the Head
Office, amounting in the aggregate to $1+70,257 >323 >
of which 59 applications were for termination guar­
antees aggregating $37>913>08l.
1+50 guarantees were
issued during the year in connection with loans ag­
gregating $5^ , 676,081. Aside from the new applica­
tions functioned during the year 19^ > there were out­
standing, as of January 1, 1 9^> 1+19 guarantees ag­
gregating $501,559^1^9.
All outstanding guarantees
require periodic reviews, loth 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 agree­
ment.
Each new application required special study,
analysis, preparation of and recommendations with
respect to appropriate terms. In some instances, it
was necessary to make plant investigations. During
the year 587 guarantees were terminated as the result
of payment of loans guaranteed, development of new
guarantees to supersede the previous guarantees, or
because the guarantee was no longer necessary on ac­
count of completion of contracts.
Guarantee fees
collected during the year for credit to the Guaran­
tors aggregated $1,985,21+2, and commitment fees col­
lected aggregated $212,1+15, making total guarantee
and commitment fees collected $2,197>658.
Our ex­
penses incident to handling the Regulation V activi­
ties aggregated $191,809.

Advances to Member Banks
During the year 51 advances were made to member
banks on their own notes, aggregating $55>380,000,
secured by Government bonds.

Miscellaneous
Complete individual credit files are maintained with
respect to each guaranteed loan.
Interim financial
statements and operating figures arc made available
to us, all of which data is carefully analyzed with
a view to detecting any unfavorable trends. Appropri­
ate action is taken in all cases with a view to pro­
tecting the Guarantors and the financing institutions.
Credit files are also maintained on approximately 100
brokerage concerns to which our Collection Department
delivers securities from time to time under trust re­
ceipts. The Credit Department advises the Collection
Department as to the maximum trust receipt privileges
which should be accorded to the various concerns.

-12-

FEDERAL RESERVE
NOTE ISSUE DEPARTMENT:

Federal Reserve Notes received from. Washington by
the Federal Reserve Agent amounted to $1,552,300,000
during the year 1 9 ^ - an increase of 59.1*# compared
with the amount received in the year 19^3 .
Federal Reserve Notes issued to the Federal Reserve
Bank of Chicago, by the Federal Reserve Agent during
the year 1 9 ^ amounted to $1,098,570,000 - an increase
of 23# compared with the amount issued in the year
19*0.

CAPITAL STOCK

December 31, 1 9 ^
December 31 > 19^3
Increase

Paid-In
Capital

No. of
Members

$19,598,700
.17^915,750

971
95^

1 ,682,950

17

$

New members
Memberships terminated
Number of adjustments in stock holdings
due to increases in capital and surplus
Number of adjustments due to decreases
in capital and surplus

25
8

713

18

FILES DEPARTMENT:

In the General Files 1,800,000 pieces were received,
indexed, sorted, and filed. This material was re­
ceived from both bank and fiscal agency operations
conducted at the main bank building. A new sorting
method, which employs a large number of 'flat' sort­
ers, enables several times the previous number of
clerks to quickly put the day's volume of material
into such order that urgent needs for reference to
the previous day's work can be satisfied before the
final filing stage has been reached.

FOREIGN FUNDS
CONTROL DIVISION:

The following are details of fiscal agency operations
for the Treasury Department handled by the Foreign
Funds Control Division during 19^:

-13-

FOREIGN FUNDS
CONTROL DIVISION:
(Continued)
License applications received

^,920

oik

License applications forwarded to Washington
License applications acted on by the
Federal Reserve Bank of Chicago

k,3^>6

Reports on Form. IFR-300 of all foreignowned property subject to the jurisdiction
of the United States, received

lk9

Reports on Form TFR-300 forwarded to
Washington
Reports on Form TFR-500, relating to property
in foreign countries in which on May 31, 1943,
persons subject to the jurisdiction of the United
States had an interest, received

6,434

Reports on Form TFR-500 forwarded to Washington

6,434

Number of
Mailings

Mailing List

Total of Pieces

Public Documents

20

3,200

64,000

The Proclaimed List of
certain Blocked Nationals

15

3,250

48,750

Special Blocked Nationals
Miscellaneous

GOVERNMENT BOND
DEPARTMENT:

44

16

«
(84 pieces)

3,696
3,200

Operations for the year show an increase re­
fleeted in the handling of savings bonds for
redemption, the processing of subscriptions
and applications in connection with the sale
and issuance of securities covering the Fourth
Fifth and Sixth War Loan Drives, and the serv­
icing of 4,550 Issuing Agents in connection
with the sale of Series E War Savings bonds.
The dollar value of subscriptions and applica­
tions to the three War Loan Drives in 1944, ex

-14-

GOVERNMENT BOND
DEPARTMENT:
(Continued)

elusive of sales to commercial banks for their own
accounts, are as follows:

Sales
Fourth War Loan Drive
Fifth War Loan Drive
Sixth War Loan Drive
Totals

Quota

$ 2 ,652,000,000
3.207.600.000
3.241.400.000

$2 ,013,000,000
2.414.000. 000
2.176 .000. 000

$ 9,101 ,000,000

$ 6,603,000,000

(Figures indicated above represent sales covering the entire
states of the district, and are not merely the figures lit the
seventh district.)

To expedite the payment of savings bonds of Series A
through E presented for payment, incorporated banks
and trust companies numbering 2,294 have been quali­
fied for this service in the 7th district. This op­
eration was effective October 2, 1944.
Comparative figures for 1944 with the year 1943 fol­
low:
NEW ISSUES

1944
Number of subscription and
application forms received

1241

Percentage of
Change

993,000

1 ,200,000

-17*

1,540,500

1 ,682,500

-

Amount of subscriptions and
applications received

$27,875,765,000

$23,670,750,000

+1856

Amount of subscriptions and
applications allotted

$17,928,514,000

$12,904,640,000

+39*

4

Estimated number of subscrib­
ers involved

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

85c

SAT.FR

31,414,000

25,998,000

+21*

$1 ,751 ,271,000

$1,399,654,000

+25*

-15-

GOVERNMENT BOND
DEPARTMENT:
(Continued)

19hb

191+3

Percentage of
Change

u. S. SAVINGS BONDS REDEEMED
Number of Pieces
By Paying Agents
By F.R.B.
Total Pieces

5,200,000
10.679.000

-0­
7.878,000

+100$
+ 36$

15.879.000

7 ,878,000

+102/i

1J,282,000

6,811,000

+ 95$

$11+0,186,000
350,555,000

-0$229,857,000

+100$
+ l+l+$

$1+70,739,000

$229,857,000

+105$

3,1+1+3,000

3 ,51+0,000

$25 pieces (included in
above)
Redemption Value
By Paying Agents
By F.R.B.
Total Redemp­
tion Value
Number of
Checks Issued

-

3$

1+83,000

+

16$

$10,776,888,000 $7 ,90I+,687,000

+

36$

REDEEMED - OTHER BONDS/NOTES/
CERTIFICATES/BILLS
Number of Pieces
Maturity Value

562,000

COUPONS REDEEMED
Number of Pieces
Dollar Value

2 ,086,000

2 ,279,000

-

8$

$87,1+1+7,000

$118,161+, 000

-

26$

DENOMINATIONAL EXCHANGES
MARKETABLE ISSUES
Pieces Received

96,000

93,000

+

3$

Pieces Issued

90,000

88,000

+

2$

$1,158,299,000

$71+1 ,000,000

+

56$

Maturity Value

-16 -

GOVERNMENT BOND
DEPARTMENT:
(Continued)

19^5

Percentage of
Change

C.P.D. TRANSFERS
Pieces Received
Maturity Value
Pieces Issued
Maturity Value

40 ,600

36,000

+13#

$2,746,111,000

$ 1 ,909,605,000

+44#

26,200

21,000

+25$

$1,646,749,000

$1 ,194,676,000

+38'$

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

1,60 6

1,436

$2,457,642,000

$1 ,199,900,000

+12#

BOND CUSTODIAN
Number of Pieces Received
from Treasury Department

35,361,000

32,494,000

ON
+

Number of Pieces Prepared
for Delivery

32,810,000

28,365,000

+16#

INCOMING SECURITY MAIL
Number of Pieces of
Mail Received

2,651,500

2,674,000

- 1#

28,780,000

+15#

SHIPPING AND DELIVERY
Number of Pieces Shipped

33,119,000

-17-

INVESTMENT DEPARTMENT:
U. S. SECURITIES PURCHASED
A m o

Transactions

IJkk

1943

3662

3201
168

200
22
2082

u n t s
1943

1244
Member Banks and Others
Other Federal Reserve Banks
Retirement System
System Open Market Acct.
Repurchase Agreement

13
31
1476

3966

$

161 ,061,250

10,610,650
12 ,635,000
10,334,853,000
$10,719,161,900

$

83,704,170
3,538,025
19,850,000
122,026,000
7,396,884,000

$7,626,002,195

OTHER SECURITIES PURCHASED
23
1
24

Member Banks and Others
Retirement System

38
39

$
$

77

142,000
200.000
342,000

$
$

266,500
1,575,000
1,841,500

•

U. S. SECURITIES SOLD
5230
394
8
-

1357
_2§Z
7976

5356
194
3
-

949
_54Z

7049

$
84,339,400
Member BankB and Others
6,102,000
Other Federal Reserve Banks
7 ,310,000
Retirement System
System Open Market Account
7,452,878,000
Repurchase Agreement
Repurchase Agreement (Matured) -2i3S5qglq020
$10,506,180,400

$

64,988,225
1,789,875
7 ,300,000
-

5,278,589,000
1,645,567,000
$6,998,234,100

OTHER SECURITIES SOLD
68
54

129
1
11

122

l4l

-

Member Banks and Others
Other Federal Reserve Banks
Retirement System

LEGAL DEPARTMENT:

$

304,500

$

2,284,000
$ _

2,588,500

328,050
20,000
528,000

-

$

876,050

The activities of this Department hare continued
to expand during the past year, primarily as a
result of the large volume of Regulation V Loan
Agreements reviewed and Guarantee Agreements and
Supplements thereto prepared for this Bank as

-18 -

LEGAL DEPARTMENT:
(Continued)

Fiscal Agent for the War and Navy Departments; also,
ty reason of the increasing number of legal ques­
tions arising under the War Manpower, Selective Serv­
ice, Salary Stabilization, Fair Labor Standards, and
Withheld Tax Regulations. Moreover, the development
end establishment of the Federal Reserve Share-theLoss program, which has been centered at this Bank,
has entailed a considerable amount of additional
legal work.
Other legal matters handled by this Department in­
clude the following: examination and approval of
a.l1 applications for membership, applications of
national banks to exercise fiduciary powers and all
documents evidencing changes in the corporate status
of state bank and trust companies; extensive corres­
pondence with member banks concerning regulations
and rulings of the Board of Governors and other legal
matters; correspondence with and preparation of legal
memoranda for Board of Governors; examination and ap­
proval of leases for additional space in other build
ings; legal questions involved in purchase of site
for addition to the Detroit Branch; protesting of
real estate tax rates and quadrennial assessment on
our Bank building; negotiation of revised fiscal
agency contracts with Commodity Credit Corporation
and Reconstruction Finance Corporation; numerous
questions relating to our safekeeping and check
clearing operations, and to our fiscal agency func­
tions for the Treasury Department and RFC; questions
in connection with our administration of Regulation W
and Foreign Funds Control regulations; and, claims
arising under our Bankers Blanket Bond.
Several members of this Department are also engaged
in a variety of administrative activities in the Bank.
An Assistant Counsel has been assigned to the Detroit
Branch to take immediate charge of its extensive le­
gal matters.

MAIL DIVISION:

A slight recession in number of pieces of mail re­
ceived and dispatched took place this year to break
the run of increases to which we have become accus­
tomed in the past several years. Increase in post­
age and express company rates, forced substitution
of United States mail facilities for points no longer
reachable by express due to war time conditions, and
heavier pieces of outgoing mail caused the postage
and express expense to run counter to the piece trend.

-19-

MAIL DIVISION:
(Continued)

Reimbursable postage showed a sizable increase,
to reflect the increasing services being per­
formed for Governmental agencies.

19^4

12hi

Decrease

Percent

Total pieces
received

3,091,621+

3,276,7211

185,100

5.02

Total pieces
dispatched

8,778,106

9,224,033

1+45,927

5

MEMBER BANK
ACCOUNTS DIVISION:

Analyses reflected 267 assessable deficiencies
in reserves of 200 member banks (Head Office
territory) for computation periods ending in the
year 1944. Penalties covering these deficien­
cies amounted to $5 ,576.75 and were assessed in
accordance with regulations. Comparative fig­
ures for computation periods ending in the year
19)+3 reflected 192 deficiencies in the accounts
of 122 member banks, involving assessments to­
talling $3,349.66. The maximum number of penal­
ties assessed against any one bank during 1944
was 7 (la one instance) as against seven (in
one instance) for 1943•
The reserves of al1 member banks in the Seventh
District for the year 1944, adjusted on the basis
of semi-monthly periods, reflected a maximum ex­
cess over requirements of $188,000,000, or 10.1+8$
for the period July 1 - 1 5 , and a minimum excess
of $120,000,000, or 6.68$ for the period April 1 6 ­
30. Maximum and minirmnn excess reserves over re­
quirements for the year 1943 were $343,000,000,
or 22.67$, and $156,000,000, or 8.79$, and oc­
curred during the periods of April 16 - 30 and
December 1 - 15, respectively.

OFFICE MACHINE REPAIRS:

The usual service was maintained by this divi­
sion throughout the year on a substantially in­
creased amount of purchased and rented mechani­
cal equipment in use in the bank and fiscal
agency divisions. .This work was carried on under
conditions similar to those existing during 1943,
which included the improvising of parts by our
mechanics in instances where replacements could
not be secured from the suppliers.

-20-

PERSONNEL DEPARTMENT:

Since September 1, 1940, 351 employees have left to enter
military service - 318 men and 33 women.
During the year of 1944:

1,107 persons were hired and 1,264 left our employ, a
net decrease of 157 *
48 loans were granted to 45 employees totaling $5,008.50.
As of December 31, 1944, there were outstanding 35 loans
to 30 employees, totaling $2 ,760.67 .
129 students were enrolled in a typing class. Classes
were conducted for 4 hours each Saturday morning.
Arrangements were made to train pages in a similar
manner.
Training Within Industry
The following in-plant courses were conducted in 1944:
Job Instruction Training:
These classes were given in five sessions of two hours
each and covered the period January 3 to February 11,
1944, inclusive. One hundred thirty employees com­
pleted the course satisfactorily.
Job Relations Training:
These classes were given in five sessions of two hours
each and covered the period February 28 to April 14,
1944, inclusive. One hundred sixty nine employees com­
pleted the course satisfactorily.
Job Methods Training:
These classes were given in five sessions of two hours
each and covered the period July 24 to December 15, in­
clusive. Seventy two completed the course satisfactori­
ly-

American Institute of Banking
During 1944, there were 195 class (including January
and September enrollments) enrollments in A. I. B.
courses. Of this number, all but 43 of the courses
were taken by women of the Bank.

The Medical Department made 1,585 physical examinations and
administered approximately 38,000 treatments to employees.

The Education Program was established during the year; its
punpose is to encourage enrollment of employees in worth­
while study courses outside of business hours.

-21PERSONNEL DEPARTMENT:
(Continued)

Employees as of:
December 31, 1944
$ of Total
December 31, 1943

$ of Total

PLANNING- DEPARTMENT:

Men

Women

Total

Annual Salaries

862
29$

2,102
71$

2,964

$5,489,732.00

2,206 3,121
70.7$

$5 ,323,629.00

915
29.3 $

During the year this department made a survey of the
overall handling of redeemed War Bonds, both In the
Treasury Department and In the Federal Reserve Banks.
The result of this survey was the development of a
routine under which tabulating cards now being punched
in the Federal Reserve Banks would become the numeri­
cal registers of the Bureau of the Public Debt.
At
the present time, these cards are destroyed after the
Banks have used thenf to run their lists of redeemed
bonds as the registers of the Bureau are being post­
ed manually. Such a plan, if adopted, would result
in a substantial saving of manpower (several hundred
employees) in one of the Bureau's most critical rou­
tines; also a considerable saving in manpower in the
Federal Reserve Banks. Complete details were sub­
mitted to the Treasury, and are now being studied by
their technical staff.
A numerical control was devised and installed for use
in connection with redeemed War Bonds. This routine
permits the accurate listing of a month's redemptions
in one group. Because Treasury Department operations
are greatly facilitated by any reduction in the num­
ber of transmission groups; and because the probabili­
ties of mechanical performance alone make the accurate
listing of several million nine-digit bond serial num­
bers in one group difficult, this control scheme has
been reduced to printed specifications and made avail­
able to the Treasury Department and to all Federal Re­
serve Banks. Research work done in connection with
the foregoing revealed certain operational economies,
which were put into effect at this Bank and later wide­
ly adopted throughout the System at the recommendation
of the Treasury Department during the Fiscal Agency
Conference held in Cleveland, Ohio, in October, 1944.
This procedure enables the Federal Reserve Banks to
reduce the sorting of tabulating cards on this par­
ticular job by approximately 20$ or a total of
500,000,000 digits per year.
The accounting for the handling and sales of War Bonds
was transferred during the year to mechanical routines
developed by this department, and revision work was
also done in connectiop. with the analysis of War Bond
sales.

-22-

PLANNING DEPARTMENT:
(Continued)

The ledgers of the Accounts and Record Division of the
Government Bond Department were transferred to mechani­
cal equipment at the recommendation and under the super­
vision of the Planning Department.
A table indicating the overtime payments for each five
minutes of overtime worked, for each salary bracket,
was designed for use in figuring and checking overtime
payments in our Employment, Disbursing and Auditing
Departments.
As in previous war years, the operation of the Bank's
accounting systems was made progressively more diffi­
cult by shortages of mechanical equipment and trained
personnel; and these difficulties were accentuated by
unprecedented volumes of transactions and by the many
new operational demands made on the Federal Reserve
Banks by the wartime economy. As a result, a substan­
tial portion of this department's effort was directed
toward the deficiency servicing of existing systems.
In line with current national policy, every effort was
made to effect reductions of manpower requirements and
to avoid wherever reasonably possible the use of criti­
cal mechanical accounting equipment. Development and
systems research work continued throughout the year,
and substantial additions were made to the backlog of
systems revisions now held in abeyance pending the end
of the war and the availability of improved equipment
and methods.

PURCHASING DEPARTMENT:

During the year 19^- the Purchasing Department issued
10,171 purchase orders, totalling approximately
$861,000, for building and office supplies, printing
and stationery, furniture and equipment, and for such
other expenses as were necessary to the conduct of our
business. These figures compared with 10,353 orders
with a dollar value of $ 900,000 during 19^3 , and rep­
resent a decrease of 1.8$ in the number of orders and
h.b'fc in the dollar value over that year.
Inventories were maintained at about the same level as
in 19^3 and prices in general reflected a slight up­
ward trend during the year.
The activities of the related Stock Room, Print Shop,
and Addressograph Sections continued at a high level
and, as in the year 19^3 > were particularly affected
by Treasury financing and related transactions.

-23-

RATION CHECK
DEPARTMENT:

This department handled 8,798,778 ration checks dur­
ing the year 1944 compared vith 7,780.588 handled in
the eleven month period oi February to December,1943 an increase of 13 .09>.

R •F •C• and C•C •C •
CUSTODY DIVISIONS:

These divisions acting as Custodian and Fiscal Agent
of the Reconstruction Finance Corporation, its vari­
ous subsidiaries/ and for the Commodity Credit Cor­
poration, made disbursements during the year 1944
aggregating $2,208,000,000, compared vith disburse­
ments totaling $2,261,000,000 for the year 1943.
Receipts during 1944 aggregated $497,000,000, com­
pared vith $554,000,000 in 1943.
The aggregate num­
ber of transactions handled during the year 1944 vas
5,607,785 compared vith 2 ,898,789 in 1943.
In connection vith loans and investments of the Re­
construction Finance Corporation, total disbursements
for the year 1944 vere $28,992,000, compared vith
$18,396,000 for 1943. Receipts for the year 1944 to­
taled $57 ,255,000, compared vith $30,627,000 in 1943.
The increases vere largely attributable to transac­
tions on loans to business enterprises engaged in the
var effort and liquidation of collateral under the
Central Republic Trust Company loan.
Disbursements to encourage production or to provide
for stock piling of strategic materials under the
programs of Defense Supplies Corporation increased to
$ 597,603,000 during 1944 from a total of $330,209,000
luring 1943. An increased volume of disbursements
under the Alcohol Purchase Program and the Butter and
Meat Subsidy Programs accounted for most of the in­
crease.
Receipts under these programs totaled
$20,598,000 in 1944 and $25,778,000 in 1943.
Disbursements for purchases of plant sites, construc­
tion of plants, and purchases of equipment for ac­
count of Defense Plant Corporation decreased from
$302,454,000 in 1943 to $106,982,000 in 1944, vhereas
receipts representing rental collections and sales of
equipment, etc., increased from $25,024,000 in 1943
to $40,140,000 in 1944.
Transactions for Commodity Credit Corporation vere
handled under instructions of the Reconstruction Fi­
nance Corporation until the close of business August
31, 1944. Beginning September 1, 1944, the Federal
Reserve Banks handled these activities directly as
Fiscal Agents of Commodity Credit Corporation. Total
disbursevents for account of Commodity Credit Corpor-

-24-

B«P«C« Audi C.C.C.
CUSTODY DIVISIONS:
(Continued)

ation for the year 1944 amounted to $1,463,000,000
compared vith $1,594,000,000 for the year 1943. Re­
ceipts for the year 1944 vere $365,057,000 compared
vith $432,265,000 in 1943. Decreases in the aggregate
transactions under the several grain programs, the
dairy products purchase programs and lend lease pur­
chases, vere partly offset hy increased activities in
the Dairy Production Draft Program and the War Hemp
Industries program.
Activity under a new program of the Reconstruction
Finance Corporation covering the disposal of surplus
government property under the Surplus Property Admin­
istration vas started in the latter part of 1944.
This program is expected to he one of the major ac­
tivities of the Reconstruction Finance Corporation
and transactions during the last quarter of 1944
vere rapidly increasing in volume although the re­
ceipts under this program to the end of 1944 amounted
to hut $883,000.

RESEARCH DEPARTMENT:

During 1944 the Research Department continued to place
emphasis upon strengthening the vork of the Bank as a
regional center of economic information and leader­
ship and upon services rendered hy the research staff
to officers and departments vith in the Bank.
Issues of Business Conditions during the year con­
tained 48 special articles on industry, agriculture,
trade, labor, and finance. Press releases from many
of these articles have been used hy nevspapers and
periodicals throughout the country, and some articles
vere reprinted for mass distribution.
The regular hanking, retail trade, and consumer credit
statistical series vere continued. Pointing the vay
to greater use of collected data hy reporting firms
received much attention. Special series included the
retail credit survey, the survey of ownership of de­
mand deposits, and the survey of country hanker opin­
ion as to farm land values and farm credit conditions.
An inquiry into W
impact,of the war upon the Chicago
industrial area and its postwar problems and prospects
is being undertaken in collaboration vith the Chicago
Committee for Economic Development and the Chicago As­
sociation of Commerce.
The research staff made 24 addresses at hanker meetings
and 63 addresses at other meetings during the year. A
meeting of country hankers to discuss agricultural and

-25-

RESEARCH DEPARTMENT:
(Continued)

farm credit policies was held at the Bank. Sever­
al thousand inquiries for economic data and inter­
pretation from ‘banks, business firms, and Govern­
ment agencies were answered.

SAFEKEEPING DEPARTMENT:

The total amount of securities received during 1944
was $35>271,596,575 as compared with $24,629*101,344
during 1943, an increase of 43$.
Securities released during 1944 amounted to the sum
of $34,601,517*211 as compared with $23*228,354*261
during 1943* an increase of 49$.
Total securities held at close of business December
31 * 1944, amounted to $5,167,457*677* compared with
$4*497*378*314 as of December 31* 1943* an increase
of 15$.
Number of receipts outstanding at close of business
December 31* 1944, was 58,551 as compared' with
57,240 as of December 31* 1943* an increase of 2.3$.
Number of pieces held at close of business December
31 , 1944, was 379*066 as compared with 367*829 as
of December 31* 1943* an increase of 3.05$.
Number of coupons detached from securities on coupon
maturity dates was 860,288 as compared with 761,571
on December 31 of the respective years 1944 and 1943*
an increase of 13$.
Total amount of coupons detached and credited as of
December 31* 1944, amounted to $87,471,200 as com­
pared with $61,578,696 as of December 31* 1943* an
increase of 42$.

TELEPHONE DIVISION:

Outgoing calls increased from an average of 28,000
per month in 1943 to 28,800 in 1944. 449 terminals
were in operation in December, 1944, as compared
with 419 at the close of the year 1943. 19 public
telephones located in convenient places throughout
the bank's quarters materially reduced the traffic
of employees' personal calls and aided in keeping
our lines free for bank business.

WAR BOND CUSTODY
DEPARTMENT:

During 1944 United States Savings bonds received
for the men in service amounted to $25,713 *295* rep

-26-

WAR BOOT) CUSTODY
DEPARTMENT:
(Continued)

resenting 582,251 transactions. There vere released
from custody $4,573*110, representing 41,966 transac­
tions. Total amount held at close of "business Decem­
ber 31 , 1944, vas $34,168,085, represented by 784,370
safekeeping receipts outstanding.
United States Savings bonds received for custody from
the public during 1944 amounted to $9,450,900, repre­
senting 29,204 transactions. Withdrawals from public
custody during the year amounted to $3 ,125,000, rep­
resenting 8,112 transactions. Total amount held as
of December 31* 1944, was $39*303*^24, represented by
72,305 safekeeping receipts outstanding. The public
safekeeping division had a steady growth throughout
the year.
Thft number of receipts at the close of the year repre­
sented an increase of approximately 40 per cent over
the previous year.

WIRE TRANSFER
DIVISION:

152,228 transfers of funds were made during the year
1944, compared with 145,035 during the year 1943
an increase of 4. 96$.

-

The dollar value of the transfers made during the
year 1944 amounted to $35*232,170,000, compared with
$34,511,507,000 during the year 1943 - an increase of
2.09$.
.-

WITHHELD TAX
DEPARTMENT:

As at close of business December 31* 1944, there were
1658 banks in District No. 7 qualified as depositaries
for "Withheld Taxes".
1515 of these depositaries
were located in our head office territory and 143 in
the Detroit Branch territory. Here at the head office,
depositaries during the year 1944 paid to us 910 mil­
lions of dollars, represented by over 475*000 receipts,
which were issued by these depositaries to employers
for the 20$ Withheld Tax deducted from salaries and
wages paid to their employees. Offices of the Internal
Revenue Department deposited with us at the head office
their Certificates of Deposit amounting to approximate­
ly 898 millions of dollars, represented by over 472,000
receipts. 1811 receipts were reported by employers as
either lost or not received, necessitating the issu­
ance of duplicate receipts by the Withheld Tax Depart­
ment.

*

*

*

*

*

*

*

*

*

-27-

D E T R O I T
19

B R A N C H
4 4

Nineteen hundred, forty-four has "been generally one of increas­
ing volume in many departments of the Branch. It also saw the fur­
ther extension of activities performed in Detroit.

In June, the Branch established its own legal department by the
appointment of an assistant counsel assigned full time. The function
of issuing, adjusting and paying interest on 2# Depositary Bonds-Second
Series for the qualified holders in this territory was transferred from
Main Office on August 1. In March, bond stock was received in amount
and variety to enable the Branch to give full CED and DX service. This
completed plans made therefor in 1943.

Tn March, also, the publication of condition of weekly reporting
member banks in Detroit was begun. Beginning with the Fifth War Loan
•Drive in June and for the Sixth War Loan Drive in November and Decem­
ber, the Branch made the statistical compilations and reports for the
state of Michigan. This step seemed tb be of considerable value to
the Drive Chairman for this state.

To get ready to handle the volume expected when commercial banks
started cashing war savings bonds in the last quarter of the year, it
was necessary to rent approximately 13,000 square feet of additional
space in the Transportation Building.

In December, negotiations were completed and approval given for
the acquisition of the 90 feet frontage on West Fort Street immediately
adjoining the Branch on the east. This step was taken looking to the
time when it will be possible to construct a building of sufficient
size to house all activities of the Branch under one roof.

A lunch room has been installed on the fourth floor of the Annex
at 735 Griswold Street for the employees working there and in the bonnecting quarters in the Transportation Building. Approximately onehalf of our entire sta^f work in these two buildings.

By permission of the War Manpower Commission, the work week at the
Branch was reduced from 48 hours to 44- hours, effective September 29th.

ACCOUNTING-RESERVES
Excess reserves of city banks were maintained at mininum levels.

-28DETROIT
ACCOUNTING-RESERVES:
(Continued)

BRANCH

Country banks continued to maintain substantial excess
reserves, but the average percentage was reduced from
last year.
Per Cent of Excess
1?44
12hi

City Banks
High
Low
Average
Last period of year

2 .6*
0.5#

2 6 .0$

i.k*
i.k*

11.4#

3 1*

3 1*
2k*
3 1*
25 *

0.5*
1 .8*

Country Banks
High
Low
Average
Period ending Dec.15

17 *
22#
25%

CASH DEPARTMENT:
Percentage relation
to*1945 activity
Currency Deposits

-

Number of Notes
Amount

85,544,000
$ 548,761,000

No Change
Dec.

Currency Payments

-

Number of Notes
Amount

108,049,000
$ 815,187,000

3* Dec.
6* Dec.

Coin Deposits

-

Number of Coins
Amount

$

27,385,000
2,142,000

Number of Coins
Amount

$

135,785,000
9,198,000

Coin Payments

-

38#
4 6*

Inc.
Inc.

10* Inc.
2.5* Dec.

CHECK DEPARTMENT:
Number of Items City
Country
Government

10 ,729,000

Dec.

.6* Dec.
k2* Inc.
h* Inc.

$ 17,998,143,000

12* Dec.

Total
Dollar amount of checks handled

4.5*

15,098,000
6,140,000
51 ,967,000

Ration Checks O.P.A;
Items
Representing

1 ,226,000
7,351,836,000

(milts)

No Change

-29D E T R O I T

B R A N C H

COLLECTION DEPARTMENT:
Activity in this department shows a small decrease from 19^5s
Items handled:

I9I+3
194U

_

67,108
65,670

City, items decreased 4,600 and Country items increased U,800.

CONSUMER CREDIT:

689 investigations were made in 19^4.
were conducted.

Eight Disciplinary Conferences

DISCOUNT AND CREDIT:
Following several years of virtually no activity, last year several
member banks frequently made use of our credit facilities to adjust
their reserve positions. This trend to increased borrowing was ac­
celerated in the last quarter, loans in this period numbering 53 as
compared to 13 in the first three quarters.
Guaranteed loans were off approximately 30$ in number and were less
than half in dollar volume.
12U

I2i£

Loans to member banks:
No. of banks accommodated
No. of loans
Amount
Outstanding loans at close of year

8
k6
$35^,600,000 $
0

1
2
25,000
0

0
0 $
0

1
250,000
.
0

Industrial loans, Section 13b:
Number
Amount
Outstanding loans at close of year
Guarantee Agreements issued - Regulation V;
Number
Amount of loans

7^
$230,905,000

105
$529,861,500

-30-

D E T R O I T

B R A N C H

EXPENSE OF OPERATING DETROIT BRANCH:

Gross Expense
Reimbursable Expenses
Net (after adjustment of
notaryfees)

1944

1945

$2,208,128
1,355,488

$1,971,139
1,239,623

852,639

731,515

61.4#

62.9%

Percent of Gross Recovered

GOVERNMENT BOND DEPARTMENT:

1944

Percentage relation
to 1943 activity

Market Transactions
Purchases
Sales

40

26

628,500

23% Dec

376,300

20 %

Inc

7,644
$3,398,684,500

2 1%

Inc

38#

$

512,957
416,030,875

13%

Dec
Inc

$

15 ,666,578
499,568,182

1%
16 %

Inc,
Dec,

$

15,946,209
689,403,100

1 9 .6%

$

105,477
8,475,165

$

Subscriptions to Government Securities
(Marketable Issues)
Number
Amount
Savings Bonds & Tax Notes Issued
Number
Amount
Savings Bonds Issued by Agents
Number
Amount
Savings Bonds Shipped to Agents
Number
Amount

9% Inc,
Inc,

Reissues of Savings Bonds & Tax Notes
Number
Amount

30% Inc,
9% Inc,

-31-

D E T R O I T

B R A N C H

GOVERNMENT BOND DEPARTMENT:
(Continued)
194k

Percentage relation
to 1943 activity

Redemptions Series A to E War Savings Bonds
(paid "by us)
Pieces
Amount
$

4,583,153
117,035,475

Series E War Savings Bonds
(received from Banks - last
quarter)
Pieces
• Amount

$

2,609,87^
64,851,521

Total
Redemption Series A to E Inclusive
Pieces
7,193,027
Amount
$ 181,886,996

160$ Inc.
100$ Inc.

Redemption Series F and G
Pieces
Amount

$

3,435,000

Other Bonds, Tax Notes, Bills,
Notes and Certificates Amount

$

500,790.400

14$

Inc.

206,977

6$

Dec.

Coupons Paid

PERSONNEL:

Number

3,882

On December 31, 1944, personnel of the Branch wap
comprised of 7 officers and 708 employees. This was
an increase of 1 officer and 18 employees over the
end of the previous year. In order to hold our own
and accomplish this small increase, 508 vere hired
as 490 were released. Percentage of turnover was 15$
less than in the previous year - 1943, 83$ - 1944, 67$,
Annual Basic salaries increased $01,6*1-0. The Training
in Industry program was participated in By 77 persons
who are in supervisory capacities. 214 certificates
were issued on the satisfactory completion of courses.

-32-

DETROIT
R. F. C. AGENCIES:

BRANCH

Disbursements for the account of the Defense Plant Cor­
poration during 1944 amounted to $168,000,000.
This
represents a reduction of $194,800,000, or approximately
54$, from the amount disbursed during 19*0 • There was
a steady increase in the volume of sales and transfers
during the year.
During the year the surplus property disposal program was
inaugurated. While the sales to date total only a mil­
lion dollars, a large volume of transactions is contem­
plated when hostilities cease.
The last of the closed bank loans was paid in full during
the year. This marks the end of a function that began in
1932 and which for a long period represented the major ac­
tivity of the department.
There was no material change in the activities of the
other subsidiaries or affiliates of the Reconstruction
Finance Corporation during the year.

SAFEKEEPING DEPARTMENT:
Amount

Number

Percentage relation
to 1943 activity

Member Banks:
Receipts Issued
Receipts Released
Balance Dec. 31 , 1944

3,724

3,261

$1 ,211 ,500,000
856,918,000
519,564,000

11$
25$
215$

Inc.
Inc.
Inc.

War Savings Bonds:
Receipts Issued
Receipts Released
Balance Dec. 31, 1944

11,431
2,599

$

6,751,000
1,348,000
12 ,763,000

26$
101$
73$

Inc.
Inc.
Inc.

282
116

$

233,957,000
167,614,000
158,672,000

16$

13$

55$

Inc.
Inc.
Inc.

1,931,000
4,580,000
3,290,000

44$
25$
40$

Dec.
Dec.
Dec.

War Loan Collateral:
Receipts Issued
Receipts Released
Balance Dec. 31, 1944
Special Custodies:
Receipts Issued
Receipts Released
Balance Dec. 31, 1944

111
113

$

-33D E T E 0 I I

B R A N C H

WAR LOAN DEPOSITARY BANKS:

Deposits

$ 1,375,6*4-8,000

Withdrawals

1,170,088,000

Balance December 31# 1 9 ^

1462,977,000

WITHHELD TAX:
Number

Amount

Receipts issued by
Depositaries

120,391

$561,120,000

Receipts credited to U.S.
Treasurer as Income Tax

120,833

$577,375#000

Balance December 31# 19*+**

2h,988

$100,157,000

(Not compared to 19*0 as there was only 6 months’ activity in that
year.)

*

-»

vJ. ■

*

*

*

*

*

*

Sets

4k

-34-

FEDERAL RESERVE BANK OF CHICAGO
COMPARATIVE STATEMENT OF EARNINGS AND EXPENSES
Years 1944 and 1943
1944

1943

$14,204,919.31

$8,738,325.32

$ 5*518,956.74
285,802.95
952^17,5.8

$4,794,017.64
294,208.73
762.007.20

Total Net E x p e n s e s .................... ..

$ 6,757*377.27

$5*850,233.57

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

$ 7*447*542.04

$2,888,091.75

$

371*579.89
12,315.23

$4*135*903.91
1*430.59

$

383,895.12

$4*137*334.50

$ 7*831*437.16

$7,025,426.25

Retirement System (increased Benefits to Members)
Retirement System (interest Base Adjustment). . .

$

-

$

Total Deductions from Current Net Earnings

$

-

$1,266,073.18

EARNINGS ..........................................
EXPENSES:
Operating Expenses ............................
Assessment for Board of Governors ..............
Cost of Federal Reserve Currency................

ADDITIONS TO CURRENT NET EARNINGS:
Profit on Sales of U. S. Government Securities .
Other Additions ................................
Total Additions to Current Net Earnings

.

Total Current Net Earnings and
Additions to Current Net Earnings. . . .
DEDUCTIONS FROM CURRENT NET EARNINGS:

Net Earnings....................................

986,400.18
279*673.00

$ 7*831*437.16

$5*759*353.07

$

$

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

5*713.45
1,115*421.66
6.710.302.05

$ 7*831*437.16

50.21

993*684.20
4.765.618.66
$5*759*353.07

SURPLUS ACCOUNT (Section 7)
Surplus January 1 ................................
Transferred to Surplus ............................
Transferred from Surplus to Reserves for
Contingencies . . . . . . ......................

$26,490,370.72 $22,924,752.06
6,710,302.05 4 ,765,618.66

Surplus December 31

$33*200,672.77 $26,490,370.72

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

-

1,200,000.00

-35-

FEDERAL RESERVE BANK OF CHICAGO
COMPARATIVE STATEMENT OF CONDITION

A S S E T S

December 31, 1944

December 31, 1943

$ 3,236,811 ,089.87

$3 ,808,383,243.70

REDEMPTION FUND - FEDERAL RESERVE NOTES. .

97,906,719.42

19 ,758,171.97

OTHER C A S H .......... ................

29,840,551.40

40,409,037.39

Total Reserves ............

$3,364,558,360.69

$3,868,550,453.06

$

-

$

4.000.00

$

-

$

4,000.00

GOLD CERTIFICATES ON HAND AND
DUE FROM U. S. TREASURY..............

BILLS DISCOUNTED ....................
INDUSTRIAL ADVANCES.......... .. . . .
Total Bills

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

2,881,806,000.00

i7?9?/995jQ0P.-QP

$2,881,806,000.00

$i,393,997,o0o.oo

2,879,402.98

2 ,947,863.09

14,752,000.00

9,905,94o.oo
306,817,379.35

OTHER ASSETS ............................

361,578,547.39
10,170,872.22

Total Assets ..................

$6,635,745,183.28

$5,588,042,011.65

$3,978,834,945.00

$3,163,199,895.00

DEPOSITS:
Member Bank - Reserve Account ........ $2,169,949,572.21
U. S. Treasurer - General Account . . .
27,826,^51.39
148,148.173.06
Other Deposits........................
Total Deposits ................ $2 ,345,924,696.66

$1,943,250,348.39
56,515,396.47
158.000.534.61

245,947,244.42

210,687,250.22

927,759.75

671,301.56

$6,571,634,645.83

$5,532,324,726.25

U. S. GOVERNMENT SECURITIES

. . . . .

Total Bills and Securities .
BANK PREMISES........................
FEDERAL RESERVE NOTES OF OTHER BANES . . .
UNCOLLECTED ITEMS

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

L I A B I L I T I E S

.

FEDERAL RESERVE NOTES IN ACTUAL
CIRCULATION ..............

DEFERRED AVAILABILITY ITEMS
OTHER LIABILITIES........
Total Liabilities
C A P I T A L

5,823>376.15

$2,157,766,279.47

A C C O U N T S
$

17,915,750.00

CAPITAL PAID IN.......................... $

19,598,700.00

SURPLUS

(Section 7)......................

33,200,672.77

26,490,370.72

SURPLUS

(Section 15B)....................

1,429,383.78

1,429,383.78

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

9,881,780.90

9,881,780.90

Total Liabilities and
Capital Accounts ............

$6,635,745,183.28

$5,588,042,011.65

OTHER CAPITAL ACCOUNTS

'
,

.
'

.

■

ur

.
■

-36-

FEDERAL 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
E A R N I N G S

Current
Earnings

Year

Current
Net
Earnings

Current
Expenses

E X P E N S E
Additions
to
Current Net
Earnings

268,885
665,937
2,083,164
8,481,747
12,012,078
30,303,218
20,382,170
6,748,863
6,511,359
5,202,169
5,424,663
6,567,043
6,167,352
8,936,418
9,889,451
4,834,153
4,143,601
5,613,671
6,764,554
8,152,371
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
14,204,212

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
___6,757^77

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
2,910,545
4,600,533
2,480,075
970,096
1,376,025
636,024
938,250
1,360,053
861,561
1,413,105
2,888,092
___7,447,542

11,833
8,050
298,510
263,967
874,264
373,245
1,611,990
951,304
1 ,526,060
811,188
1,637,141
521,313
1,530,021
163,061
386,898
4,137,334
.-^85,895

Totals $221,992,233

$106,174,914

$115,817,319

$16,246,918

1914-15
1916
1917
1918
1919
1920
1921
1922
1923
1924
1925
1926
1927
1928
1929
1950
1931
1932
1933
1934
1935
1936
1937
1938
1939
1940
1941
1942
1*43
1944

$

$

and

$

$

Deductions
from
Current Net
Earnings
$

-

D I S P 0 S I T I 0 N

S

.

2,127
-

69,307
4,826
572,019
41,903
27,857
12,646

13,098
13,061

3,210
25,000
269,343
198,356
985,630
332,600
1,147,779
1,835,610
1,001,883
374,467
571,997
501,781
365,710
488,143
380,467
273,218
273,272
812,517
1,493,297
4,808,032
2,660,159
1,563,978
499,607
1 ,182,207
476,646

Net
Earnings

157
602,842
1,266,073
-

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
771,220
932,178
1,687,606
1,090,958
982,917
2,607,974
1,024,465
1,197,161
5,759,353
7,831,437

$24,676,081

$107,388,156

282,100

$

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
858,127
761,334
753,583
725,553
763,115791,007
819,532
826,919
896,766
955,508
993,684
1,115.422

$25,757,894

Transferred
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
121,279
932,366
669,479
153,241
883,370
279,031
158,265
1,770,131
100,484
237,632
4,765,619
6,710,302
$56,156,953

Transferred to Reserves
for Contingencies
Years 1940, 1942 and 1943

N E T

E A R N I N G S

Paid U.S.
Transferred
Treasury
to Surplus
(Section 13B)(Section 13B)
$

-

$

$
-

-

-

-

-

-

-

-

-

-

■

-

-

17,637
28,354
28,354
20,714

- 26,322
25,030
12,767
206
-

5,120
10,924
27,215
4,021
50
5,713
$ 148,102

-

_
$

Franchise
Tax
Paid U.S.

11,681

Balance
to
Profit & Loss
$

-■
215,799
-

-

-

10,394,480
11,576,009
1,186,301
246,586
602,838
1,091,513
-

-

-

__
$25,313,526

$

$19,748,517
* Payments from U. S. Treasury
Years 1934 and 1935.
3,207,763

22,956,280
$33,200,673

20,091
41,887
-61,978
-

-

1,417,702*
$ 1,429,38?

Deductions from Surplus (Section 7)
Purchase of F.D.I.C. Stock Year 1934

of

.
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1951
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