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Federal Reserve Bank of Cleveland 1926 TWELFTH ANNUAL REPORT TO THE FEDERAL RESERVE BOARD ANNUAL REPORT of the Federal Reserve Agent of the Fourth Federal Reserve District to the Federal Reserve Board Covering Operations for the Calendar Year 1926 FEDERAL RESERVE BANK OF CLEVELAND LETTER OF TRANSMITTAL February 10, 1927. SIR: I have the honor to transmit to you herewith the twelfth annual report of the Federal Reserve Bank of Cleveland, covering operations for the calendar year 1926. Respectfully, GEORGE D E C A M P , Federal Reserve Agent. HON. D. R. CRISSINGER, Governor, Federal Reserve Board, Washington, D. C. Directors and Officers, 1927 DIRECTORS CLASS A O. N. SAMS, Hillsboro, Ohio, 1927 CHESS LAMBERTON, Franklin, Pa., 1928 ROBERT WARDROP, Pittsburgh, Pa., 1929 CLASS B JOHN STAMBAUGH, Youngstown, Ohio, 1927 R. P. WRIGHT, Erie, Pa., 1928 G. D. CRABBS, Cincinnati, Ohio, 1929 CLASS C W. W. KNIGHT, Toledo, Ohio, 1927 L. B. WILLIAMS (Deputy Chairman), Cleveland, Ohio, 1928 GEO. DECAMP (Chairman), Cleveland, Ohio, 1929 OFFICERS GEO. DECAMP, Chairman of the Board E. R. FANCHER, Governor and Federal Reserve Agent M. J. FLEMING, Deputy Governor w tr u A • * * T? J i F - J- ZURLINDEN, Deputy Governor W H. FLETCHER, Assistant Federal H R STRATER, Cashier and Secretary Reserve Agent and Manager, Ex- w < F TAYLOR, Assistant Cashier amination Department c w . ARNOLD, Assistant Cashier J. B. ANDERSON, Assistant Federal ft H. WAGNER, Assistant, Cashier Reserve Agent and Manager, Sta- c LB. CLOUSER, Assistant Cashier D tktiral DenartrnMit- - BICKFORD, Assistant Cashier tistical Department G A S T E P H E N S O N > Manager, DepartF. V. GRAYSON, Auditor ment of Bank Relations CINCINNATI BRANCH DIRECTORS OFFICERS CHAS. W. DUPUIS ~ ~. , FRED A. GEIER B ^. F H. KROGER r ~ , , ~. - MCCOMBS, Managing Director B. J. LAZAR, Cashier E. S. LEE C. F. MCCOMBS H. N. OTT, Assistant Cashier JOHN OMWAKE _ GEO. M. VERITY , _ ., BRUCE KENNELLY, Assistant Cashier PITTSBURGH BRANCH DIRECTORS A. E. BRAUN OFFICERS . J. C NEVIN, Managing Director CHARLES W. BROWN J ^SSS T. C. GRIGGS, Cashier R. B. MELLON JOSEPH R. NAYLOR - F - COBUN, Assistant Cashier T. M. JONES, Assistant Federal J. C. NEVIN Reserve Agent F TWELFTH ANNUAL REPORT FEDERAL RESERVE BANK OF CLEVELAND Despite a considerable degree of irregularity in certain of the significant items in the condition reports of both the Federal Reserve Bank of Cleveland and the member banks in this district, the year 1926 has been one of relative stability. Gold reserves and bills discounted have been subject to wide and somewhat violent fluctuations, while the movements of deposits in member banks, both demand and time, have exhibited somewhat unusual characteristics. The demand for accommodations at the Federal Reserve Bank of Cleveland was normal during the first nine months of the year, following which, partly to offset heavy withdrawals at member banks, there occurred a sharp increase in the volume of bills discounted. From a low point of $30,000,000 in late July, discounts rose to approximately $100,000,000 in late December. The increase was particularly noticeable in the months of October and December. The peak reached in the latter month was the highest since early in the year 1922 with the exception of one point in December, 1925. Quite contrary to the experience of this bank in previous years, there was a sharp decline in gold reserves between March and June, followed by an almost equally sharp recovery in the following two months. From this point on there was an almost continuous decline for the balance of the year, apparently caused by an unusual excess of transfers of funds out of the district which accounts in part for the sharp increase in discounts that occurred in the late months of the year. (Chart I.) RESULTS OF OPERATIONS The seasonal reduction in borrowings at the Federal Reserve Bank of Cleveland which occurred in the first two months of the year was much sharper than that of any previous year since 1922, discounts falling from $71,000,000 in early January to $38,000,000 in early February. The customary spring demand carried discounts nearly to the $70,000,000 mark in March, after which a practically continuous decline set in, culminating in a low of $30,000,000 in late July. From this point on, they increase seasonally to a high point of $100,000,000 on December 22. Holdings of bankers acceptances showed a continuous increase throughout the year, from $5,000,000 in January to a peak 7 of $36,000,000 in December. The movement in this particular item was almost exactly the reverse of that of the previous year, in which the high point was reached in early January and the low in late December. Total bills and securities fluctuated within a somewhat wide range, from a low of $87,000,000 in early February to a high of more than $170,000,000 in late December. The reserve ratio fluctuated within a narrow range throughout the year until early October, when, following the increase in discounts, it dropped rather sharply from about 75 per cent to a low of 61 per cent in December. The discount rate of this bank for all classes of paper and for all maturities remained unchanged at 4 per cent throughout the year. The tabulation below gives in comparative form a statement of the various classes of rediscounts and loans in 1925 and 1926. More detailed statistics concerning the activities of the discount and other departments of this bank may be found in the Annual Report of the Federal Reserve Board. Comparison of various classes of rediscounts and loans—1926 and 1925 (Amounts in thousands) 1926 Secured by U. S. Government obligations Commercial and industrial Bankers' acceptances Trade acceptances Agricultural and live stock Demand and sight drafts $3,052,549 643,451 " 4*723 3,655 Total $3,704,378 1925 $2,426,270 720,129 5 7,826 4,480 108 $3,158,818 MEMBER BANK CREDIT The outstanding feature of credits extended by member banks is a continuation of the quite marked increase in loans secured by stocks and bonds which occurred in the year 1925. At the close of the year under review, this figure for 74 reporting member banks in the Fourth Federal Reserve District was approximately $155,000,000 in excess of January, 1925. This has not been accompanied by a corresponding increase in commercial loans, which in the same period increased approximately $80,000,000. Investments of these same banks have been slightly reduced, so that of the increase of approximately $235,000,000 in total loans, discounts, and investments of reporting member banks in the principal cities of this district, approximately twothirds is accounted for by the increase in collateral loans. Demand deposits in reporting member banks in this district, after remaining unchanged for a period of about twenty months, showed a quite sharp increase (about $70,000,000) from April 8 to August of 1926. At this point occurred a gradual decrease carrying the total at the end of the year to approximately the previous level. Time deposits show a much sharper increase in the first seven months of the year from a low point of $748,000,000 in January to a high of $836,000,000 in July, which was followed by a slight but almost continuous decline to the end of the year. This latter movement is contrary to that which occurred in the United States as a whole, where time deposits show a continuous but moderate increase throughout the year. EARNINGS AND EXPENSES OF MEMBER BANKS An analysis of earnings and expenses of Fourth District member banks for the years ended June 30, 1925 and 1926, shows a rather sizeable increase in the percentage of losses, and a substantial decrease in the percentage of earnings carried to undivided profits. Salaries and wages are practically unchanged, while interest on borrowed money shows an increase of approximately 50 per cent. Interest paid to depositors consumes 51.3 per cent of expenses, this figure remaining unchanged from that of the year before. A distribution of losses shows a very decided increase in the percentage losses on loans, the figures being 45.4 per cent of total losses for 1925 and 58.2 per cent for 1926. The percentage loss on securities was reduced from 33 to 25.3 in 1926. "Other" losses show a decrease from 21.6 to 16.5. For the fiscal year ended June 30, 1926, the distribution of gross income was as follows: Expenses 71.5 per cent Losses 7.9 per cent Dividends 13.6 per cent Undivided Profits 7.0 per cent Chart II shows in graphic form the distribution of income and the distribution of expenses and losses for the year. MOVEMENT OF MEMBERSHIP During the year under review there were admitted to membership in the System from this district seven new banks, six of them national banks and one a state bank. One of the national banks thus admitted merged with another national bank within two months of being admitted. Withdrawals from membership numbered twelve, seven national banks and five state banks being affected. Of these twelve withdrawals, two, both national banks, were voluntary liquidations, and three, all state banks, were voluntary withdrawals. The seven remaining withdrawals are accounted for by mergers with existing institutions. One state bank was absorbed by a na- tional bank while a second state bank merged with another state bank member. Three national banks merged with other national banks, while two other national banks merged with non-member state banks. The total number of members in this district on December 31, 1926 was 858, of which 746 were national and 112 were state banks. This compared with 863 members on December 31, 1925, of which 747 were national and 116 state bank members. The total resources of the new state bank and the six new national banks at date of admission approximated $8,000,000. The capital stock of this bank on December 31, 1926 was $13,617,750 as compared with $13,175,800 a year ago and the surplus account totaled $23,745,855 on December 31, 1926 as compared with $22,893,598 on December 31, 1925. Member bank reserves have increased nearly 6.5 million in the same period. Fourth District members Dec. 31. 1925 Withdrawn National banks State banks. Total membership Admitted Dec. 31, 1926 747 116 7 5 6 1 746 112 863 12 7 858 RELATIONS WITH MEMBER BANKS During the calendar year 1926, more than 1600 banks were visited by members of the bank relations staff. Of this number 1526 were member banks, and 83 were non-members. Eight special visits on matters of more than routine importance were also made. Representatives of this department attended 3 bank conventions and 16 group meetings. Members of the official staff or of this department also attended the opening of new member bank buildings on 19 occasions. During the year more than 3,000 visitors were conducted through the main office building. In January, the territory covered by travelling representatives of this bank was redistricted, and three field men are now covering the entire district which formerly required the services of four men. BANK EXAMINATION The examination department of this bank has continued to act in close cooperation with and to enjoy cordial relations with the office of the Comptroller of the Currency and the banking departments of the four states included in this district. It has also continued to carry out the broader program of investigation inaugurated last year. 10 During the year this department conducted 68 examinations, three of which were investigations of national banks and made in conjunction with the national bank examiners, and 64 were investigations of state banks made in conjunction with the examiners of the several states. In one instance, that of a state bank, our examiners conducted an examination independently. During 1926, members of the staff investigated one application for membership, and investigated and made recommendations with respect to the establishment of branches in nine instances. There were 13 instances of investigation and recommendation regarding the granting of fiduciary powers to national banks and 14 instances of investigation and recommendation regarding interlocking directorates. FEDERAL RESERVE NOTES The volume of Federal Reserve notes issued by this bank showed a very marked decline during the entire first half of the year reaching a low point of $187,000,000 in early August. From that date on the upward trend was quite rapid reaching a high point in December, about $10,000,000 less than the December peak of a year ago. This movement resembles that of no other year in the history of this bank. The movement of Federal Reserve notes in this district offers also a marked contrast to the trend of notes in circulation of the entire System. Following the usual seasonal decline in January, the note circulation of all twelve Federal Reserve banks shows a gradual and continuous increase from the low point in February to a December peak that was $20,000,000 above the December high of the year previous. On December 31, 1926 the volume of notes of this bank in circulation was $219,960,625 as compared with $232,614,585 on December 31, 1925. During the year the Federal Reserve Agent received from the Comptroller of the Currency $155,940,000 in new notes as compared with $175,940,000 during 1925. The total of new notes issued to the bank and of fit notes reissued to the bank was $189,020,000 compared with $212,640,000 of similar issues and reissues during the previous year. Fit notes redeemed by the Federal Reserve Agent totaled $34,500,000, and unfit notes returned to Washington for destruction totaled $161,233,150, as compared with $26,550,000 and $153,861,810, respectively, a year ago. The total currency receipts of this bank for 1926 exceeded the total currency disbursements by nearly 9l/2 million dollars, and the combined currency receipts and disbursements for the year 1926 were 132 million in excess of the figures reported last year. Currency receipts from members and non-members and currency disbursements to the same are both larger than the figures reported in 1925. Total currency operations with members and non-members for the year just passed were $1,771,046,674 as compared with $1,653,167,713 for 1925. 11 The tabulation below compares the principal operations of the money department of this bank and its branches. Federal Reserve notes 1926 Outstanding December 31 I n actual circulation December 31 New notes received from Comptroller Notes issued and reissued to bank Fit notes redeemed by Federal Reserve Agent Unfit notes returned for destruction 1925 $256,123,715 219,960,625 155,940,000 189,020,000 34,500,000 161,233,150 $262,836,865 232,614,585 175,940,000 212,640,000 26,550,000 153,861,810 Currency operations—Total receipts and disbursements Receipts Cleveland Pittsburgh Cincinnati Disbursements $492,447,026 585,089,177 207,067,234 $1,284,603,437 Total $485,119,062 586,859,755 203,357,980 $1,275,336,797 Currency operations wtth members and non-members Receipts Cleveland Pittsburgh Cincinnati Total Disbursements $314,880,926 439,255,246 132,978,945 $302,108,015 449,625,192 132,198,350 $887,115,117 $883,931,557 CHECK COLLECTION AND CLEARING OPERATIONS The amount of work handled by the transit department of this bank during 1926 shows a decided increase over the amount of work handled during the year previous. The total number of items which this department handled during the year was 72,194,006 which figure is 4,488,682 items in excess of the 1925 figure, or an increase of 6.6 per cent. The amount represented by these items shows approximately the same rate of increase. The total amount of check collections in 1926 was $28,297,848,000 as compared with $26,363,252,000 in 1925, or an increase of 7.3 per cent. These figures do not include duplications, that is, items handled by both the main office and branches to the number of 1,296,395 and to the amount of $316,385,000. Of the 72,194,006 items handled 7,707,245 were drawn on Cleveland banks, 6,101,851 on Pittsburgh banks and 3,387,729 on Cincinnati banks. The items drawn on other banks in this district totaled 49,963,019, those drawn on banks in other districts totalled 2,692,652 and those drawn on the Treasurer of the United States 2,341,500. The number of items handled by each of the three offices, Cleveland, Pittsburgh and Cincinnati was 31,439,940, 23,400,454 and 17,353,612 respectively. 12 Transit department check clearings and collections for year 1926 Cleveland No. of Items On On On On Amounts 7.707,245 22,057.001 713,024 962,670 31,439,940 $10,151,298,798.77 $128,810,811.76 $5,029,798,019.64 1,152.105.986.02 92.316,641.78 110,287,265.32 17,353.612 $6,384,507,912.76 237,161 $55,469,059.61 6,101,851 15.397,124 1,281,520 619,959 $9,568,486,065.31 1,507,872,578.24 618.374.718.73 67,307,813.99 23,400,454 Total. Items sent to Cincinnati and Pittsburgh branches 493,486 3,387,729 12,508,904 698,108 758.871 Cleveland banks other banks in District No. 4 banks in other districts Treasurer of United States $7,473,296,382.08 2,453,858,217.38 136,003,909.77 88,140,289.54 $11,762,041,176.27 565,748 $132,005,059.12 Cincinnati On Cincinnati banks. On other banks in District No. 4 On Treasurer of United States . . Total Items sent to Main Office and Pittsburgh branch. Pittsburgh On On On On Pittsburgh banks other banks in District No. 4 banks in other districts Treasurer of United States Total Items sent to Main Office and Cincinnati branch Recapitulation Total number of items handled Total amount of items handled . Items and amounts handled by both parent bank and branches and not duplicated in above figures 72 ,194,006 1,296,395 $28,297,847,887.80 $316,384,930.49 COLLECTION DEPARTMENT During the year under review 373,453 items amounting to $502,476,366.19 were handled through the non-cash collection department of this bank. This was a decrease of two per cent in the number of items handled and an increase in the amount of items handled as compared with 1925. Of this total 269,567 items aggregating $267,022,921.16 were paid through the three offices of this bank. Approximately 84 per cent of the items handled was collected which percentage is somewhat smaller than that of last year when 88 per cent of the items handled was collected. Collecting banks made charges on 32,243 items which aggregated $14,938,620.53. The collection charge amounted to $13,565.28 which was at a rate of slightly less than one-tenth of one per cent. There were collected without cost 237,324 items amounting to $252,084,300.63. 13 Member banks in this district continue to take advantage of the direct routing plan and forwarded to other Federal reserve banks and branches for collection during the past year 60,599 items of which 53,408 items amounting to $71,158,254.54 were paid, and 7,191 items totaling $4,675,782.48 were returned unpaid. Collections No. of Items Cleveland Cincinnati Pittsburgh.. . . . Total Amount 329,952 18,490* 25,011* $404,578,736.53 49,900,028.78* 47,997,600.88* 373,453 $502,476,366.19 •Represent collections payable only in cities of Pittsburgh and Cincinnati. FISCAL AGENCY OPERATIONS Two series of Treasury certificates of indebtedness and an issue of Treasury bonds of 1946-56 were offered for subscription during 1926. The certificates in each case were offered at par and the amount of the September 15 offering alloted in the Fourth District was $25,953,000 while the amount of the December 15 offering alloted was $9,064,500. The Treasury bonds, bearing 3^4 per cent interest, were offered at 100*/? and the amount allotted in this district was $51,090,000. On March 1 the Secretary of the Treasury invited holders of Third Liberty loan bonds to submit proposals for the sale of such bonds to the Treasury, purchases to be made at the lowest prices offered. The offers accepted and purchases made in this district aggregated $1,737,600 face amount. Government securities received for exchange consisted of 141,019 pieces in coupon form and 19,235 pieces in registered form, aggregating $86,579,500. Against such receipts there were delivered 41,318 obligations in coupon form and 16,105 in registered form. Government coupons redeemed during 1926 totaled 4,806,022, aggregating $62,848,706. Government obligations presented for redemption numbered 287,208 and had a value of $108,556,266.25. Included in these figures are 70 pieces of Intermediate Credit Bank debentures having a value of $700,000 and 335 pieces of Federal Land Bank bonds valued at $3,326,000. PERSONNEL In the election of directors which occurred in 1926, Mr. Robert Wardrop of Pittsburgh, and Mr. George D. Crabbs of Cincinnati, were reelected as Class A and B directors, respectively, for terms of three years beginning January 1, 1927. Mr. George DeCamp was reappointed by the Federal Reserve Board as Class C director for a term of three years, and redesignated Chairman of the Board and Federal Reserve Agent. 14 At the Cincinnati branch, Mr. A. Clifford Shinkle resigned as a director in May, and in his place this bank apponted Mr. B. H. Kroger, President of the Provident Savings Bank and Trust Company of Cincinnati. In September, Mr. A. E. Anderson also resigned, and in his place the Federal Reserve Board appointed Mr. Fred A. Geier, President of the Cincinnati Milling Machine Company. At Pittsburgh, Mr. A. L. Humphrey, President of the Westinghouse Air Brake Company, was appointed a director of the Pittsburgh branch by the Federal Reserve Board, for a term of three years beginning January 1, 1927, succeeding Mr. J. D. Callery. To fill the vacancy created at the Pittsburgh branch by the appointment of Mr. George DeCamp (formerly Managing Director) as Chairman of the Board and Federal Reserve Agent, Mr. J. C. Nevin, formerly Cashier and Secretary, was appointed Managing Director, effective January 16th. Mr. Herman F. Strater, formerly Assistant Cashier, was appointed Cashier and Secretary to succeed Mr. Nevin. On April 1, Mr. C. F. McCombs of the Department of Bank Relations was appointed Managing Director at the Cincinnati branch to succeed Mr. L. W. Manning, resigned. There has been no material change in the number of employees of this bank and its branches during the past year. On December 31, 1926 the entire personnel numbered 954 as compared with 941 a year ago. GENERAL BUSINESS CONDITIONS Prosperous conditions prevailed throughout 1926 in the Fourth Federal Reserve District. The upswing in business which commenced about the middle of 1925 continued into 1926, and business remained at high levels until the fourth quarter, when a moderate recession set in as a result of a sharp drop in automobile production and declining iron and steel operations. The most important single industry in the district is iron and steel, and numerous other lines are dependent upon it. During most of the year, operations in this industry were at record levels, particularly in the summer when a slackening ordinarily occurs. Toward the end of 1926, however, a marked recession took place, operations falling to 70 per cent of capacity or less. As pointed out above, this may be largely accounted for by lower automobile production. The coal trade in the district started the year in the throes of a depression of long standing, caused by excess productive capacity. After the British coal strike had been going on for some time, however, the export demand strengthened, and by the end of October soft coal exports were nearly three times the usual figure at that period. This, coupled with the normal winter increase in householders' demand and the laying-in of supplies in 15 anticipation of a possible strike in April, 1927, caused a short "boom" period in which production figures made a new record for all time. Many union mines reopened, prices at the mine soared to nearly double their previous figure, and wages were increased in some non-union fields. With the cessation of the British strike, however, prices slumped quickly, although production continued high. Tire manufacturers in the Akron territory experienced a rather poor first half-year, but conditions improved in the latter half. The rapid decline in crude rubber prices early in the year, following their erratic course in 1925, was the main depressing factor. Manufacturers found themselves burdened wth stocks of rubber purchased at high prices on the one hand, while on the other, public demand was at a minimum, awaiting tire price cuts following the fall in crude rubber prices. Stocks in manufacturers' hands became abnormally large, and production schedules were then reduced. An improvement began early in July, when tire prices were cut generally; public buying picked up considerably and continued high throughout the summer, so that factories were again working at capacity. Operations in the fourth quarter fell off somewhat, owing partly to seasonal factors and partly to decreased automobile output, but even so, they were approximately as large in the last half of the year as in the first. In building, the record of this district was less satisfactory than in the country as a whole. Very bad weather during the first quarter hampered outside work, and a loss of 15 per cent from last year in the value of building permits in this period was shown by 28 large cities in the district. Conditions improved somewhat with the coming of better weather, but the remainder of the year was just about able to hold its own with 1925, and for the first 11 months of 1926 the 28 cities showed a loss of 13 per cent, while the loss for the United States was only 6 per cent, according to Bradstreet's. Agricultural conditions were only fair on the whole. The crops started well, but corn and tobacco were both caught by the excessive rains in the fall months. Corn production in the district was 14 per cent under last year, and the burley tobacco crop in Kentucky was inferior to normal, both in production and quality. Wheat made a better showing, as the season was pretty well over before the heavy rains set in. Fruits of all kinds did unusually well. Department store sales for the year were between 1 and 2 per cent larger than in 1925 . The holiday trade was at a high level, as sales in both November and December were ahead of last year. Wholesale sales compared unfavorably with 1925 except in the case of drugs and shoes. The latter made a really notable gain of about 11 per cent over 1925, as a result of the marked revival which took place in the district's shoe industry about the middle of the year. 16 Volume of operations in principal departments No. of pieces handled 1922 1923 1924 1925 1926 117,437,000 139,105,000 58,143,000 12,092 34,932 16,021 128,085,000 161,788,000 67.433,000 11,036 28,427 10,059 135,693,000 176,965,000 68,039,000 13,177 29,668 8,672 145,093,000 183,291,000 68,888,000 12,530 26,547 11,616 151,404,000 184,583,000 73,487,000 7,921.000 350,000 3,007,000 68,000 2,905,000 6,434,000 390,000 17,228,000 88,000 3,611,000 5,475,000 442,000 2,483,000 90,000 3,530,000 5,066,000 381,000 819,000 95,000 3,355,000 4,806,000 373,000 459,000 89,000 1.523,346,000 95,551,000 653,478,000 12,269,000 11,956,422,000 Bills discounted: Applications .. Notes discounted Bills purchased Currency counted Coin counted Checks handled Collection items: U. S. coupons paid All other i_i Fiscal agency operations -3Transfers of funds Envelopes handled 2,436,808,000 196,774,000 821,051,000 12,499,000 24,354,352,000 1,348,025,000 116,070,000 833,126,000 14,419,000 23,874,737,000 3.158,818,000 115,583,000 874,797,000 16,519,000 26,652,412,000 3,704,378,000 153,571,000 939,106,000 16,309,000 28,614,232,000 62,051,000 405,362,000 1,002,514,000 3,098,602,000 63,857,000 469,979,000 900,529,000 3,649,583,000 64.778,000 427,264,000 348,600,000 4,752,346,000 64,834,000 476,805,000 324,788,000 5,333,830.000 62 849,000 502,476,000 273,650,000 4,460,935,000 13,139 36,444 Amounts handled Bills discounted Bills pu rchased Currency counted Coin counted Checks handled Collection items: U. S. coupons paid All other Fiscal agency operations Transfers of funds . Principal assets and liabilities of Federal Reserve Bank of Cleveland by weeks—1926 Amounts in thousands of dollars Bills discounted for member banks 1925 Jan. t Total bills and securities Total Secured by U. S. Government obligations Other bills discounted Bills bought in open market United States securities Foreign loans on gold Total cash reserves Member banks' reserve deposits Total deposits Federal Reserve Reserve notes in percentages circulation 20 17 113.434 110,845 106,594 92.734 71,012 65.954 58,067 43,880 36.187 40.053 33.662 26,286 34.825 25,901 24,405 17,594 5,210 7,657 11,347 12,171 36,409 36.485 36,485 35.987 803 749 695 696 299,566 303,588 293,717 314.953 173.130 176,920 170,771 179,900 177,535 179,830 174.467 183,401 223,792 218,925 207.951 205,468 74.6 76.1 76.8 81.0 3 10 17 24 87.349 97,671 93,359 93,081 38,158 49,658 43.149 42,737 19.105 25,443 20,016 22,586 19,053 24,215 23,133 20,151 14,800 15,326 16,702 18,025 33,706 31,906 32,759 31,559 685 781 749 760 313.058 313,812 308,102 312,790 177,343 185,646 183,862 172,405 181,137 189,147 187,250 172,179 199,588 204,466 199,579 208,223 82.2 79.7 79.6 81.6 3 10 17 24 31 100,234 107,453 95,433 118,312 116,345 48.620 52.007 48,232 68.192 64,183 27,618 24,643 29.008 44,107 44,439 21,002 27.364 19.224 24,085 19,744 19,124 21,009 20,883 20,893 21,023 31,559 33,496 25,494 28,371 30,229 931 941 824 856 910 305,224 299,226 299,302 283.924 286,880 179,034 177.130 174,542 171,466 170,688 184.180 182.124 177,245 176,166 181,188 203,448 204.189 199,058 203.339 201,458 78.7 77.5 79.5 74.8 75 0 Apr. 7 14 21 28 115,233 122,366 109,428 107,515 59,770 64,384 51,262 50,836 39,653 44.495 32.039 34.259 20,117 19,889 19.223 16.577 22,326 21,076 20.125 18,702 32,195 35,975 37,110 37,110 942 931 931 867 286,776 285,896 283,350 291,970 173,601 180.482 173,701 174,345 181,397 185.332 176,791 176,139 199,948 201,678 194,206 201.413 75.2 73.9 76.4 77.3 May 5 12 19 26 101.452 123.012 110.583 106,489 47,056 69,384 56,965 47,465 29,834 51.128 42,142 32,412 17,222 18.256 14,823 15.053 16,477 15.718 15,643 21,009 37,116 37,118 37,183 37,223 803 792 792 792 294,404 279,823 289,445 290,486 176,005 179,547 185,756 176,995 179,729 183,300 188,644 179,714 196,303 198,854 190,708 194,795 78.3 73.2 76.3 77.6 June 2 9 16 23 30 109.432 106.481 116,397 111.436 108,014 46,757 43,765 44,359 48,851 47,413 33,444 30,276 32,014 32.919 34.572 13,313 13,489 12,345 15,932 12.841 23,994 23,263 22,328 24,515 22.599 37.729 38.554 48,907 37,353 37,414 952 899 803 717 588 284,463 286,665 275,010 284.947 284,543 174,709 177,925 183,755 183,664 177.756 177.662 180.173 185.628 185,219 179,748 194.353 193,368 188,898 189,058 191,712 76.5 76.7 73.4 76.1 76.6 Feb. OoMar. 21 28... 101.681 98.809 94,714 89.359 40,271 40,058 34,655 30,456 24,142 26,810 24,868 22,563 16,129 13,248 9,787 7,893 23,587 20.995 22,320 21.346 37,299 37,414 37,418 37,418 4 11 18. 25 98.298 104,005 102.925 99,803 36,547 42.890 39,717 38.105 21.871 25.185 28.455 27,186 14,676 17,705 11,262 10,919 23,334 23,014 25,391 26.484 38.417 38,101 37,817 35,214 Sept. 1 8 15 22 29 95.851 98.031 112,127 111,200 110.442 33,467 37,505 43.996 50.353 50,736 21.212 25.250 28.827 28.547 32.973 12,255 12.255 15,169 21.806 17,763 27.398 26,200 25.463 27,102 26,610 34,986 34,326 42.668 33,745 33,096 Oct. 6 13 20 27 1 .. 120.698 135,115 136,604 136,960 58,916 74,187 75,139 74,122 30,591 42,176 40.681 43,865 28,325 32.011 34,458 30,257 28,092 27,238 26,775 28,148 33,690 33.690 34,690 34,690 .... 134,826 149,172 143,939 141.246 69,260 82,050 75,981 74,835 38,865 52.416 48,950 44,865 30,395 29,634 27.031 29,970 30,024 31,580 32.416 30,903 35.542 35,542 35,542 35,508 I. 8 15 22 29 Daily Average: 1926 1925 1924 1923 141.808 152.932 158.769 171.670 167,378 114,140 111.919 95.286 106.765 75,890 83.930 88.742 99.744 97,147 55,323 53,024 32.679 51,717 50.155 49,695 54.363 63.767 68.240 25,735 34,235 34.379 35,977 28,907 30,669 33,100 35,354 36.184 34,488 22,997 22.496 19.055 36,380 35.249 35.902 34.673 35,742 35.743 35.381 35.387 43.494 18.668 Aug. ° Nov. 3 10 17 24.. J Dec. 524 342 321 139 287,179 306,737 300,780 305,518 170,654 189.634 185,092 181,077 173,325 193.011 190.108 186,062 194,552 194,541 186.922 189,315 78.1 79.1 79.8 81.4 300,200 305,803 305,497 316,349 189,291 190,045 190,102 192,181 192.586 193,433 195,501 194,611 186,508 196,276 194,693 200,879 79.2 78.5 78.3 80.0 313.122 314,250 303.009 301,361 300.766 184.012 180.413 191,121 183.678 180,138 188,233 182,593 192.531 191.206 184,915 199,263 207,065 206.515 204.290 207.053 80.8 80.6 75.9 76.2 76.7 II I 289.756 288,929 275,240 282.526 186,067 183,882 188,283 183,030 188.640 187.513 191,030 186,015 203,548 211,033 203,207 209,346 73.9 72.5 69.8 71.5 .. . 280,157 263.582 268,992 279,140 181,867 177.070 187.133 178.705 186,705 183.606 192.908 185,173 205.309 208.625 204,072 213,432 71.5 67.2 67.8 70.0 277,088 269,229 268.884 254,150 259,310 294,183 294,410 312,337 312,132 179.552 177.147 185.333 175.513 180.034 179.202 174.737 166.194 158.370 185,502 182.896 187,789 180,756 183,524 183,181 178,206 170.793 162,723 213,228 218,949 224.448 235.614 225.601 203,893 208.181 216.380 237.238 69.5 67.0 65.2 61.0 63.4 76.0 76.2 80.7 78.0 ... 439 1.012 Statement of the condition of the Federal Reserve Bank of Cleveland December 31, 1926 and December 31, 1925 RESOURCES Dec. 31, 1926 $303,855,157.09 9,550,701.00 $275,046,988.04 $313,405,858.09 5.5O8.5OO.OO 14,445.00 611,068.79 . $192,604,320.00 62,915.704.02 994.632.14 47.340,500.63 263,646.856.04 11,400,132.00 Total gold reserves Legal tender notes, silver coin and certificates-. Total cash reserves Non-Reserve Cash: National bank notes . . Federal Reserve bank notes Subsidiary silver, nickels and cents Total non-reserve cash Bills and Securities: Member bank collateral notes Bills discounted for member banks Bills bought in open market U. S. Government securities: U. S. 4 \ i % Liberty Loan b o n d s . . . . U. S. bonds issued since 1921 Other U. S. bonds . Treasury notes . . . . . . . . . Treasury certificates of indebtedness Participation in Special InvestmentForeign loans on gold Dec. 31. 1925 $153,371,170.00 56,281.555.12 7,461,587.37 46,532.543.55 Cash Reserves: Gold with Federal Reserve Agent Gold settlement fund—Federal Reserve B o a r d . . Gold redemption fund—Federal Reserve n o t e s . . Gold bullion, coin and certificates . . 4,626,000.00 13,315.00 429,730.05 $6,134,013.79 $5,069,045.05 $57,875,507.77 21,566,386.84 33,217,340.50 $42,959,221.79 23,169,124.19 4,989,615.36 547,330.00 205,300.00 414,800.00 15,540,700.00 5.431,500.00 14,015,000.00 7,354.900.00 195,000.00 414,800.00 10,293,700.00 499,500.00 17,651.500.00 834,600.00 $148,813,885.11 66.323,749.52 $108,361,961.34 68,554,299.52 6,906,245.11 898,373.59 6,998,796.28 928,202.76 7,804,618.70 686,033.25 7,926,999.04 517,999.80 . $7,118,585.45 886,756.51 $7,408,999.24 1,031.120.32 . $504,323,978.42 $503,831,283.56 $219,960,625.00 $232,614,585.00 178,471,876.37 1,260,328.50 3,012,715.04 816.812.53 161,570.53 171,928,292.76 983,276.06 883.193.99 986,490.10 372.107.63 $183,723,302.97 62,307,999.61 $175,153,360.54 59,105,427.58 13,617,750.00 23,745,854.58 968,446.26 13,175,800.00 22,893,597.54 888,512.90 $504,323,978.42 $503,831,283.56 . . . Par value of bills and securities Uncollected Items Bank Premises: Banking house and land—Cleveland Banking house and land—Pittsburgh. Total bank premises Less reserves for depreciation Bank premises—net Total miscellaneous assets Total Resources . LIABILITIES Federal Reserve notes (in actual circulation). Deposits: Members—Reserve account U. S. Treasurer—General account Foreign banks . Non-members—Clearing account Official checks and drafts outstanding Total deposits Deferred Availability Items Other Liabilities: Capital stock paid in. Surplus fund' Miscellaneous liabilities ] __ Total Liabilities . . 20 Profit and loss account—1926 Total gross earnings Current expenses $4,517,884.04 2,531,746.02 Current net earnings Net deductions from current net earnings $1,986,138.02 325,376.31 $1,660,761.71 Net earnings available for dividends and surplus Dividends Nos. 20 and 21 Transferred to surplus $808,504.67 852,257.04 $1,660,761.71 21 GOLD RESERVES END OF MONTH flGURCS DOLLARS 2 II ALL FEO BES: BANKS ^ ^ CHART I ANALYSIS OF EARNINGS & EXPENSES FOURTH DISTRICT MEMBER 8ANKS rSAH ENOIHG JUNE 30 1926 DISTRIBUTION OF DISTRIBUTION OF EXPENSES EARNINGS tm UNOIVIOCO pnoriT$ rax CHART II 22 « 149.059.000 a 2