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AoRDAt DRSRDfR BANK

Of CtRfRUNo

1955 Annual

THE

FOURTH

FEDERAL

RESERVE

Report

DISTRICT

CLE.VE.LAND

I,OHIO

January 20, 1956

To the Banks in the
Fourth Federal Reserve District:

e
It may be <hat at ,ome time in the future, today" bank r<
ia
will look back on the year i.55 with =,talg .
~be demand for
banking servi " hM been great.
Loan portfolio' are bulging,
delinquencie<c low, and earning' are at a new high.
100"" in
assets are not now apparent.
With high employment, relative ,tability of price', enand a
lv
seemingly =boun
optimi,m about the future, bu,ine"m
ded
and con,umer< generallY seem more willing to extend them se "
creditwi

than is usual with a less ebullient economy.
se
en
Recognizing that banker' and bu>ine"m
are import=ed
to gr=t credit to a greater array of cu,tomero than ever before
and that each requ •• ,.., merit, it i' perhap' appropriate that a
t
~rd of caution be voiced about credit polic",and term' of repayment.

Concern h" been e""r •••• d by a number of leadero of the
vario ' segm " of the finandal community about deteriorating
credit term' en rel""ed criteria.
and
Such observation, are ,ound
u
and ,hou
be beed
in these day' of exuberance le,t an overed
burden of rapidly created debt r eeuit in 10" both to tbe lender
ld
and to the borrower.
con,tant and alert attention to each crodit
gr=ted"
a re,pon,ibility of every loan officer and credit man.
We are pleased to present this report of Federal Reserve
Bank of Cleveland for 1955. ~he report thi' year contain' a sec
tion on the Cind
br=ch and the area which it serve'.
~be
unati
officer' and ,taff of thi' bank appredate the cooperation ,0 cordially
given us by banker' and bu,ine"men.
Such cooperation h"
materially aided US in carrying out our responsibilities.
r

president
Chairman of the Board

Economic Review of 1955
Monetary

Policy for Sustainable Growth

Banking in the Fourth District

4

9

.

Upsurge in Industry

12

Agricultural

15

Income Declines

Operations
Three Major Instruments

of Federal Reserve Policy

Volume of Service Operations.
The Pittsburgh

. . . . . . . . .

Branch Begins a Building Program

The Cincinnati Branch and the Area it Serves

. .

16
18

20
21

Financial Report
Statement of Condition

28

Earnings and Expenses

29

Directors and Officers

30

Promotions and Retirements

. . . . . . . . . . . . . . . . . 32

for sustainable growth

The sequel during 1955, however, was quite the
opposite, although by no means unprecedented.
Prices of many raw materials and manufactured
products promptly began to go up-not
down.
Capacity production itself, despite the slow-butcontinuing application of labor-saving equipment
and technology, was generating a record stream of
purchasing power, week by week. Moreover, by
midsummer, inventories throughout every phase
of production and distribution had declined to
almost record peacetime lows in relation to sales.
To put it another way, in April, after eight months
of rapidly increasing production, business inventories were not any larger than they had been at
the beginning of the industrial recovery in late
1954, whereas sales had improved substantially.
Sellers could not meet the additional demand merely by drawing down stocks. Instead, the demand
for stock-piling throughout trade and industry was
superimposed upon the already growing rate of
takings by fabricators and consumers.
An important source of purchasing power behind this resurgence of demand is described below,
but the fact remains that the consummation of capacity operations, together with virtually full employment, triggered an inflationary advance in the
price index of nonagricultural products. Given a
volume of demand which was still in excess of current supply, no other outcome was possible in an
economy where a free price mechanism is functioning. Any remaining illusion that full employ.
ment and capacity operations constitute no threat
to price stability has been seriously challenged by
the sequence of the past year.
In passing, a third disillusionment
may be
noted. It has been demonstrated once more that
general prosperity can be attained without equal
participation by all major industries. The producers of raw food and natural fibers, for example,
as well as some lines of manufacture, failed by a
considerable margin to share in the gains experienced by nearly all others. If agricultural prosperity is not the sine qua non of general prosperity
it was thought to be, certain other industries, conventionally described as being of a bellwether na-

The past year may be aptly described as one of
disillusionment-using
that word in its original
and most constructive sense-but
the ultimate
benefits to be derived therefrom are not visible at
present in concrete form. They are almost completely overshadowed
by the immediate and
tangible economic accomplishments
of a truly
cornucopian
year.
In emphasizing the revelatory aspects of 1955,
it is not intended to detract in any way from the
scores of new high records established in industrial
output and productivity, in business sales and retail trade, in employment, and in living standards.
To the contrary, it is actually because of these
very achievements that certain confusing illusions
and inhibitions have been at least partially dispelled.

Pattern

of the Year

First of all, it was forcefully demonstrated during 1955 that a vigorous economic expansion can
materialize without the stimulus of a war-deferred
civilian demand, such as existed in the early postwar years, and without being accompanied by an
inflationary fiscal program on the part of the Federal government. The strong year-long upward
trend of industrial production into record high
ground, without special or outside help, may have
dissipated some misconceptions as to the essence
of a free enterprise economy, taking the form especially of an underestimation
of its vitality. Disillusionment of that sort represents a net addition
to the stock of economic knowledge.
Another development during 1955 which contained the seeds of disillusionment was the upturn
of prices which emerged during midsummer, ostensibly from nowhere. The upturn developed
along about the time when the economy was approaching practically full employment and essentially full utilization of industrial capacity. On
some occasions in American economic history, the
outpouring of goods and commodities on such an
enlarged scale shortly would have produced a glut
in the markets and would have precipitated price
concessions all along the selling front.

4

I

I

II

ture, also may long have been overrated with respect to their importance in steering the economy.
Conceivably then, should one of this year's front
runners lag during 1956, such faltering may not
necessarily have an adverse effect upon the general level of activity.

Commercial

Bank Lending

Although the break-away of prices (on the upside) during the summer was not a foredrawn conclusion, the backbone of the demand which precipitated an inflationary climate had been under
observation for some time. It was the persistent
rise in the growth of all kinds of loans, by all kinds
of lenders, and for all kinds of purposes.
Borrowing is not necessarily inflationary per se.
So long as the amounts borrowed are in harmony
with the rate of real savings, the inflationary influence is held to a minimum. When home building is financed, for example, out of insurance-company premium income (which in turn was saved
out of current income by the policy holder) no new
purchasing power is created. But loans by commercial banks represent newly-created purchasing

INDUSTRIAL
INDEX

power which, when advanced to the construction
industry, either directly or indirectly, will supplement the existing demand for lumber, cement,
steel, and other building materials, all of which
were in relatively short supply throughout much
of last year. By the same token, loans by commercial banks, whether directly to the would-be
purchaser of a motor vehicle, or indirectly to him
through the channels of a sales finance company,
have a similarly expansionary effect upon the demand for automobiles, and for the raw materials
used by the industry.
A chart on the next page suggests the rate at
which private investments out of real savings have
been supplemented by the creation of commercial
bank credit over the past eight years. It is significant that the expansion in commercial bank loans
since late 1954 has been more rapid than at any
other time in the entire period.
In its earlier stages, the expansion in commercial
bank credit was the occasion of no particular concern to the monetary authorities, provided that
the lenders were adhering to time-tested principles
of credit extension. The outright creation of new

PRODUCTION

AND

(1947.49=JOO)

160.---------------,---------------~------ISO

By mid-1955, industrial
recovery had retraced all
of the preceding decline
and production was approaching capacity operations in many lines.
Commodity prices (nonagricultural)
had been
comparatively
stable up
to this point in the cycle,
but then began to advance
(into record high ground)
at a rate which was symptomatic of an inflationary
climate.

110

COMMODITY

PRICES

( Nonagricultural)

IOOr----------------r---------------f-------

5

PRICES

ALL
Loans

COMMERCIAL

Outstanding

and

Holdings

BANKS

(U. S.)

of U. S. Govt.

Securities

Bllhons of Dollors

Bllhons of Dol/ors

-------

90 ,----------------

-,90

80

80

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

70

70

60

6U

50

50

40-

40

30

30

20

20

10

10

1948

1949

1951

1952

1954

1955

The latest expansion in commercial bank loans, which began in late 1954, has been the
largest on record in peace time. In order to meet the prodigious demand for loans, the
lending banks in the aggregate disposed of substantial quantities of government securities,

purchasing power, in addition to the current
stream, causes no problems under conditions when
additional manpower, raw materials, and idle
plant capacity can readily be brought into production to fulfill the increased demand. At a time,
however, when scarcely any leeway remains, as
was the case by last midsummer, the creation of
supplementary
purchasing power through commercial bank credit truly upsets the applecart of
price stability.
The mitigating aspect of the 1955 bank loan expansion was the fact that it was accompanied by a
substantial liquidation-almost
dollar for dollarof Government securities. In a sense, therefore,
the loan expansion was financed to a great extent
by the owners of existing deposits, who exchanged
their deposits, so to speak, for Government securities; the deposits were then, in essence, conveyed
to the various borrowers.
The tendency for commercial banks to dispose
of Government securities almost pari passu with

commercial loan expansion was not an accidental
development, nor does it imply that the securities
were sold at advantageous prices. Actually, the
selling banks had scarcely any alternative (if they
wished to accommodate the persistent demand for
credit) because of the fact that the unused lending
power of commercial banks as a whole was slowly
diminishing. The gradual tightening in the reserve position of member banks was consistent
with Federal Reserve monetary policy, one of the
major objectives of which was that the return of
prosperity should not be accompanied by such
over-commitments
and speculative excesses as
inevitably lead to trouble.
Member Bank Borrowing
Ordinarily a member bank may borrow from
its Federal Reserve bank to replenish its reserves.
Such borrowing did, in fact, increase during the
past year, particularly through the second half.
The $700-million increase in borrowings between

6

out most of 1954, to 2Y2 percent. [On August 4,
this bank went directly from 1% percent to 2;l4'
percent; the other eleven banks (rate shown in
chart) increased their rates only to 2 percent, and
then moved upward to 2;l4' percent in early
September.]

May and November was capable of supporting,
theoretically at least, an increase of more than
$4 billion in deposit liabilities which concurrently
were rising because of bank credit expansion.
The aggregate of such advances to member
banks, however, was considerably smaller than
during the last preceding cycle of credit expansion
which occurred in 1952-3, even though the volume of activity in such credit-using industries as
automobiles and house construction 'has been
markedly higher this time than in the earlier
period. From all indications, existing funds and
savings have been employed much more promptly
and effectively in the current boom than for many
years past.
In order to discourage member banks from
patronizing the discount window too freely, and
in order that the cost of such borrowing should be
in line with the general rise in the cost of money
which was taking place, the discount rate of the
Federal Reserve banks was raised in a series of
steps from 1Y2 percent, which prevailed through-

BORROWINGS
at Federal

BillJon$ of Dollars

Open Market

Operations

Open market operations throughout 1955 were
used in what may be termed a stabilizing role. The
net change for the year in holdings of U. S. Government securities and bankers acceptances was
comparatively small. Purchases or sales were made
in most instances merely to offset the normal
swings of float during each calendar month, to
mitigate the effects of the ebb and flow of the currency needs of the public and of the Treasury's deposits at the Federal Reserve banks-movements
which could be quite disruptive to the banking
system unless anticipated-and
in the latter
months of the year, to provide for an estimated
seasonal rise in bank loans and currency outflow.

BY MEMBER
Reserve

Billions

of

BANKS

Banks

Dollars

2.0

Two Phases

1952

1953

1954

of Rapid

Expansion

1955

Despite the record volume of new loans made, member bank borrowings from the Federal Reserve
Banks expanded less rapidly during 1955 than during the 1952 wave of credit expansion. The discount
rate was increased four times during 1955, whereas during 1952 it remained unchanged at 1%%.

7

For the year as a whole, the net outflow of currency into circulation, which represents a direct
drain on member bank reserves, was on the order
of $500 million. The movement of gold into or out
of the country during 1955 was so small as to pose
no problem with respect to member bank reserves.
In short, monetary policy was aimed at permitting only the normal seasonal expansion of production, marketing, and distribution to take place
during the second half of 1955. In the face of inflationary tendencies in the realm of nonagricultural
prices, it was deemed unwise to expand central
bank credit so that every borrowing desire could
be accommodated. To have permitted the business boom itself to dictate the degree of credit expansion at such a time would have heen to induce

MONEY
(Yields

on Selected

the gravest
stability.

Interest

RATES
Pernmf

4

m-

Rates

Before ending this review, one more disillusionment might be mentioned-again
in the sense that
the dispelling of anything resembling an illusion
is a net contribution to the art of economic analysis. Measuring the degree of tightness in the
money market, or the effects of higher interest
rates, has once more been shown to be an inexact
science. As indicated on an accompanying chart,
the gradual decline in the liquidity of money market institutions was not reflected in the same degree, nor wholly in accordance with precedent,
through every segment of the market.
Short-term rates, as typified by the market
yield on 3-month Treasury bills, rose much more
rapidly than longer-term interest rates. Although,
as was indicated earlier, member bank borrowings
did not parallel the 1952-3 phase, the cost of borrowing money at short term rose measurably
above the 1952-3 peak.
On the other hand, longer-term rates seem to
have shown much greater immunity from tightening credit conditions. The decline in the prices
of long-term U. S. Government securities or of
corporate and municipal securities has been much
more moderate than during the 1952-3 cycle. This
relative immunity raises the question of whether
restraint was of the degree desired, and, secondly,
the question of the extent to which market psychology offsets-or accentuates-monetary
policy
from time to time. In any event, the illusion has
been dispelled that any given volume of borrowings, of net borrowed reserves, or of excess reserves,
or any stated discount rate will create a precisely
predictable and measurable degree of monetary
restraint.
The past year was a highly satisfactory one. It
was prolific not only with respect to the production of economic wealth but also in terms of educational content and provocative challenges. The
nation has been enriched both materially and intellectually as a consequence of the economic developments of 1955.

Types of Securities)

Percent

kind of price and employment

4

CORPORATES

Aaa

Doily Average. by Months

-1955-

The continuing demand for credit during 1955 produced a sharp
increase in money rates in the short-term sector of the market.
The market yield on 3-month
Treasury bills advanced from
around 174:% to well over 2%.
The cost of borrowing in the longer-term capital markets also
increased during /955, but by relatisely moderate proportions.

8

.,<

'"
_

:f :.

.,...."

~~

'iIJ

.•.

•

x

•• "'""
:

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!f."
-""«

>£,,;:

"" ~.

<
.~

"

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ff,

~

M

the Fourth District

The broad expansion of expenditures by consumers and business during the year brought
heavy credit demands to financial markets. Rising
outlays on goods and services were made possible
not only by the high levels of income, but by a
substantial expansion in credit of all types.
In the Fourth Federal Reserve District, as in
the nation, the resurgence of demand for loans at
member banks marked a sharp change from the
preceding year. It was a profitable year for District banks, even though the rate of expansion in
their total of loans and investments was moderated by Federal Reserve policy aimed at promoting sustainable economic growth by restraining
inflationary pressures.
Total loans and investments held by Fourth
District banks rose by less than 3Y2 percent in
1955-the smallest relative growth in the past five
years. The moderate net growth of member bank
credit in 1955 resulted from two sharply differing
forces: a vigorous upsurge in loans that was offset
in large part by a decline in bank holdings of U.
Government securities. In order to finance one of
the heaviest totals of loan demand of recent years
at a time when loanable funds were tight, banks
in this District as well as elsewhere found it necessary to dispose of a large volume of Government
securities.

s.

LOANS
Fourth
Millions

District,

Weekly

Reporting

Member

01 Dollars

Banks
Millions 01

o

(Del:. '55 Partly Estimated)

1950

1951

1952

1953

1954

1955

of District member banks, amounting to over $500
million, occurred at reserve city banks; country
bank holdings of Treasury securities showed virtually no change for 1955 as a whole. Country banks,
however, expanded their portfolios of corporate
and municipal securities, as compared with a decline in 1954; reserve city banks reduced their
holdings of such securities.
Business loans accounted for about 40 percent of
total loan growth at weekly reporting banks in the
Fourth District during the year. Mainly because
of the importance of heavy industry in the District, the previous year's decline in business loans
had started earlier, had lasted longer, and had
gone further than in the nation as a whole. By the
end of 1955, however, about three-fourths of the
lost ground had been recovered.
As a reflection of the high level of building activity, business loans to construction firms rose
steadily throughout the year. In addition, real
estate loans showed a strong trend at District

Loans
At Fourth District banks, loans rose by nearly
$900 million, or about 20 percent. One outcome of
such a development was that by mid-1955, total
loans of District member banks had risen above
their holdings of Treasury securities for the first
time in many years.
Loan expansion at member banks in the five
reserve cities in the District was about 2Y2 times as
large as that of all country banks. (The reserve
cities are Cincinnati, Cleveland, Columbus, Pittsburgh and Toledo. The 22 reserve city banks hold
over half of the total resources of all District member banks.) At the same time, the entire year-toyear reduction in Government security holdings

[Continued

9

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1750

1750

on Page 11]

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FEDERAL RESERVE DISTRICT

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NOVEMBER

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member banks
and
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• MEMBER
• BRANCH

10

BANK

[Continued

from

Page 9)

Not only did the volume of demand deposits at
District member banks rise substantially above
that of the previous year, but the rate of spending
of such accounts also increased. For the three
months ended in November 1955, for example, the
volume of checks written against privately-held
demand deposits was 17 percent larger than in the
year-ago period.
Since about 90 percent of all expenditures are
made by means of checking accounts, the combination of larger demand deposits and a higher
rate of turnover was a significant factor in the
rising volume of consumer and business expenditures during the year. Both nationally and in the
Fourth District, idle funds were transferred to
spenders, and the available money supply was
more fully utilized.

DEPOSITS
Fourth
Billions o(

District

Member

Banks

Dollars

Billions of DollorS'

14

14

12

10

6

--

/

V

.:»

TOTAL LpOSITS

./ ~

~

f'7

~

1

"'"

o

1

,,--'

DEMAND

DEPOSITS

L'J-.. .~

~

~

8

6

TIME DEPOSITS

4

Reserves
(Oer. '55 Porlly Estimoted)

o
1950

1951

1952

1953

1954

1955

o

Free reserves of District member banks became
negative in the fourth quarter of the year (as
shown by the chart) while for all member banks in
the nation, that situation had developed as early
as August. With total member bank borrowing exceeding excess reserves, the volume of member
bank deposits was being supported by net borrowed reserve funds, which is the main significance of "negative free reserves." Such a situation
tends to militate against overly-rapid further expansion in bank credit at a time when the demand
for goods and services is pushing hard against the
productive capacity of the economy.

banks, rising even more sharply than the large expansion last year. Consumers have been buying
houses-both
old and new-at a record rate, with
a greatly enlarged volume of mortgage credit.
The rise in consumer expenditures during 1955
on durable goods other than houses was also financed by heavy borrowing. Such credit demands
were reflected in a record extension of business
loans to sales finance companies by District member banks, and also in a sharp growth of consumer loans.

MEMBER

BORROWINGS,
AND

FREE

Fourth

Deposits
The expansion in total deposits at Fourth District member banks amounted to about 4 percent,
a somewhat greater rate of increase than in the
previous year. The pattern of demand and time
deposits differed from that of 1954, however. As
might be expected in a period of high-level business activity, about four-fifths of the deposit
growth during 1955 occurred in demand deposits.
In 1954, by way of contrast, most of the expansion took place in time deposits-which
are relatively inactive funds.
As in the case of total loans and investments,
country banks accounted for ever two-thirds of the
expansion in total deposit accounts. Their share
of the demand deposit growth was even larger.

BANK

RESERVES,

District

Member

EXCESS

RESERVES
Banks

Millions of Dollars

Mdliom of Dollars

200

200
(Daily Average,

150

Months)

~----+-------t-----+------j

150

-----1100

50

1952

11

•
upsurge In

Steel

It was a cornucopian year, as mentioned previously in the discussion of monetary policy. Almost every major business or economic indicator,
with the exception of farm income, set a new
record high for the year, and by a substantial
margm.
As the year was approaching its end, the nation's
industrial machine was showing signs of strain.
The shortage of various steel products-particularly structurals, plate, sheet, strip, and barswas hampering a variety of industries and forcing
a few to curtail production. Virtually every kind
of nonferrous metal at times appeared to be in
short supply. Other materials whose supply was
less than current demand in varying degrees included glass, cement, and paperboard. A shortage
of freight cars persisted through the fourth
quarter.
The employment situation likewise reflected
the upward surge of production and high activity
in the trade and service industries. Total employment was at record levels and unemployment
hardly more than 3 percent of the civilian labor
force (about the practical minimum in a peacetime economy) in the early part of the fourth
quarter. Shortages of skilled labor of various kinds
were growing more serious and forcing many companies to work their employees overtime to obtain
desired output.
Thus, with production in many industries being
pushed to capacity, or to the maximum permitted
by the supply of raw materials, with a shortage of
transportation equipment hampering the free flow
of goods, and with a labor force nearly fully employed, it appeared at year end that not much
further expansion in output could be achieved
until new production facilities were activated.
The continued rise of durable goods production
in the second half of 1955 had a particularly strong
impact upon the Fourth Federal Reserve District,
whose economy is dominated by heavy industry.

Steel mills of the District, which have about
40 percent of the nation's total steel ingot capacity, pushed production steadily upward through
the first half of the year to nearly 100 percent of
capacity by mid-June. Production was then interrupted by preparation for a labor dispute which
lasted less than 24 hours as final negotiations for
a new wage contract were concluded.
Steel production in the District, despite the
heavy pressure for deliveries, did not return to
near-capacity levels until late September. Mill
operators were hampered by the hot weather, by
the damage caused by the temporary shutdown,
and by the need to make repairs that had been
postponed earlier in the drive to produce all
possible tonnage. By October, four of the five
major steel producing areas in the District were
operating at 100 percent or more of theoretical
capacity.
Nevertheless, output was unequal to demand
of consuming industries and order backlogs continued to mount. By December 1, it appeared that
orders already booked, and inquiries for future
tonnage, would assure near-capacity
operation
through the first half of 1956.
The unexpectedly large demand for steel that
persisted through the normally dull summer
months caused District producers-as
well as
steel companies located elsewhere in the nationto reappraise the long-term demand for steel.
Within less than a year, excess capacity, which
had been thought sufficient to meet expected
growth in the rest of the decade, had given way to
a recognized state of serious shortage.
Thus, as a result of long-term studies of the
potential demand for steel, the industry has already begun its third large postwar expansion
program. To date, 12 major steel companies of
the District have publicly announced new expan-

12

STEEL PRODUCTION,
'ngoll

ond Sleel

Autos

U. S.

for Ca.ling.

The record-smashing production performance
of the automobile industry in 1955 in turning out
about 8 million passenger cars (an increase of 45
percent over 1954, and 20 percent above the previous 1950 record) had a heavy impact upon
District industrial activity.
A large part of the nation's automotive steel
requirements is produced in the Fourth Federal
Reserve District. The District's importance as a
source of automotive steel, parts, and skilled labor
became more evident during 1955 as car builders
pushed ahead with expansion programs. During
the past twelve months, very large parts plants
of various descriptions have been proposed, put
under construction,
or purchased in Toledo,
Sandusky,
Cleveland,
Cincinnati,
Mansfield,
Columbus, and Twinsburg, Ohio.
Automotive demand has also stimulated a major
expansion of plate glass making facilities in the
Toledo area, in order to increase the output of the
complicated curved safety glass demanded by
current styles. Other industries
which have
spurted under the stimulus of automotive demand include rubber, paint, gray iron foundries,
aluminum,
zmc die casting,
and electrical
equipment.

Millions of Net Tons

MiIIiOf)$ of Net Tons

125

125

100

100

75

75

50

50

25

25

o

1947

1949

1951

1953

1955

sion programs that will take from one to three
years to complete. The new investment will increase steel ingot capacity in the District by about
2,800,000 tons, to bring the District total to
roughly 53,250,000 tons. In addition, large increases in steel finishing and supporting facilities
will be made. The emphasis appears to be toward
increasing capacity for the hot and cold rolling of
sheet and strip. Substantial increases will also be
made for the production of galvanized steel, tinplate, pipe, wire products, electrical steels, and
alloys-chiefly
stainless products.

Iron Ore
Lake ore carriers worked the latter part of the
shipping season at near capacity, trying to bring
enough ore down the lakes to supply steel mills
and to build up adequate stockpiles of ore for the
winter months. At mid-November,
250 boats
were listed as still active in the ore trade, as compared with only 69 active boats a year ago.
About 87 million tons of ore moved down the
lakes during 1955, making the year's total the
fourth best on record.

o

AUTO

PRODUCTION,

U. S.
Millions

Millions of CO"

of Ctm

10

10

8

8

6

6

4

4

2

o

13

1947

1949

1951

1953

1955

e

MANUFACTURING
Fourth
INDEX (1950=

EMPLOYMENT
District
INDEX (1950=100)

100)

130

130

steadily. The largest pile-up of orders has probably
occurred in heavy steel mill equipment.
New orders for machine tools also improved
substantially. Although the new order intake for
machine tools ran well above 1954 levels, tool
shipments lagged far behind, at least until the
final quarter of the year. Builders have been unable to rebuild depleted skilled labor forces as
rapidly as they would like, and often have had
to resort to heavy overtime schedules.

Employment
100

100

90

Total manufacturing employment in the Fourth
District by year end had advanced nearly 10 percent from the low point of the 1954 recession, but
it was still below the peak of 1953.

90

Coal
The three-year decline in bituminous coal production was arrested during the year. District
coal production rose along with national production to register a 20-percent gain over 1954 output.
A number of factors have improved the long-term
future for coal, especially in this District.

80

80
1952

1953

1954

1955

Rubber
Booming auto production kept tire manufacturers on an overtime basis through much of 1955.
Production for the year was up about 25 percent.
Tire producers continued their rapid shift to the
tubeless tire, which is now standard equipment
on all new cars, and strove to make the new tire
predominant in the large replacement market.
The scarcity and high cost of natural rubber
have stimulated a further shift to synthetic rubber. Nearly 60 percent of all new rubber consumed
was synthetic as compared with a 51-percent proportion in 1954.

Construction
Construction activity in the Fourth District
roughly paralleled that of the nation during 1955.
As measured by construction contract awards,
District activity was about one-fifth above 1954
levels and, if allowance is made for the large contracts for the Portsmouth atomic energy plant
awarded in 1953, the 1955 construction volume
was at a new peak.
Some easing of the rapid pace of homebuilding
activity became evident in this District, and across
the country, in September and October when the
volume of residential contracts fell below the unusually high year-ago totals. By any other comparison, however, the level of residential awards
toward the end of the year was exceptionally high,
running a third or more above comparable totals
for all years prior to 1954. Paced by awards for
commercial and manufacturing buildings, District
activity in the nonresidential building category
was about one-sixth above that of the previous
year.
Material shortages-particularly
of cementplagued builders throughout most of the year.
Rising materials prices and wage increases in the
building trades pushed construction costs up by
3 to 5 percent during the year.

Machinery
The District's
complex machinery industry
generally surged forward in 1955 under the dual
impact of high-level consumer spending for all
sorts of home appliances and the sharp turnabout
of business expenditures
for new plant and
equipment.
The largest increases in both production and
employment took place among producers of major
household appliances, with output up by more
than 20 percent from 1954. Producers of general
industrial machinery, both electrical and nonelectrical,
reported
an order inflow well in
excess of sales, and order backlogs increased

14

income declines

real-estate market. The trend toward larger-size
units to permit more efficient use of machinery
may have been a contributing factor.

Under the burden of heavy surplus, agricultural
prices continued to decline during 1955; at the
same time, farm output for the year was boosted
to record heights. Demand for farm products
during the year was greater in magnitude than
ever before, but it was not adequate to clear the
excessive stocks.
Gross returns from farming in 1955 averaged
about 3 percent below the previous year for all
farms in the nation. Net returns dipped about 10
percent. Production costs moved up slightly, despite lower prices on goods of farm origin.
The decline in farm income was far from uniform for the various types of agricultural enterprises or for the various geographic areas of the
country. Differences are illustrated by the accompanying chart which shows the average decline
in gross farm income in each of the states which is
included (or partly included) within the Fourth
Federal Reserve District. Thus, percentage declines were more marked in Kentucky and Ohio
than in Pennsylvania or West Virginia. In Ohio,
the sharp decline in hog prices was an especially
important factor. Farm income in Kentucky was
affected particularly by a 23 percent cut in burley
tobacco acreage. The importance of dairy products and poultry in Pennsylvania's agriculture was
probably an important factor in limiting the income decline in that state, insofar as prices of
such products showed an improvement during
1955.

Farm Credit
Outstanding credit in use by farmers was substantially greater in 1955 than in 1954, both nationally and in the Fourth Federal Reserve District. Increased use of credit for feeder cattle was
one of the major factors in this District. Furthermore, in an effort to cut costs per unit of production, farmers generally continued
to find
necessary a heavy investment in farm enlargement, machinery, fertilizer, insecticides and other
goods. With reduced incomes in 1955, farmers
were less able to cover such costs on a cash basis.
Collections on farm loans during the year were
a bit slower than in the previous year, but were
not so slow as to create any widespread delinquency problem.

Land Values
Values of farm real estate advanced to record
levels in 1955, suggesting one of the perplexing
aspects of the year's developments. Traditionally,
land values are thought to follow the trends of income derived from the land or of prices of farm
products. The contradictory
movement in 1955
has called for more searching explanations of the

15

THREE MAJ(

and th
The Federal Reser
other eleven Reserthe Federal Reserv.

BOARD OF
GOVERNORS

of the

Making a change, either upward or downward, in the interest rate charged on loans
to member banks is the historic prototype
of central-banking
instruments.
Such
changes usually signalize or confirm some variation
in the System's monetary
and credit policy.
In initiating action in this sphere, a Reserve Bank takes into account national
well as local conditions. Such steps are frequently, although not always, taken
about the same time by all twelve Reserve Banks.

as
at

The Federal Open Market Committee
meets at regular and frequent intervals to review and to discuss the
System's credit and monetary policy.
At such meetings the broad objective
is redefined in the light of latest developments, and a general directive is
agreed upon with respect
to open
market operations
in U. S. Government securities. Proceeding under such direction, the Federal Reserve
Bank of New York acts for the account of all twelve Reserve Banks
in carrying out the purchase-or-sale
transactions
through dealers in
Government
securities.

16

When an all-i
of credit con
Governors rna
which each 0
against its de
under an arnr
the amend mel
which the Bo
action.

)R INSTRUMENTS OF FEDERAL RESERVE CREDIT POLICY

is bank's share in the responsibility

for their use

JI

ve Bank of Cleveland participates with the
Banks and with the Board of Governors of
e System in the use of the three major instru-

re

nclusive action toward the easing or tightening
ditions seems to be called for, the Board of
y reduce, or increase, the percentage of reserves
f the 6,600 member banks is required to hold
posit liabilities. The Board has this authority
!nd~ent
to the original Federal Reserve Act;
it prescribes upper and lower limitations
within
ard may exercise its discretion in this t:ype of

ments of credit control. As depicted below, varying roles are played
by the Reserve Banks and the Board of Governors, respectively,
in the use of the different instruments.
Changes in the discount rate are initiated by the Reserve Banks,
while the Board of Governors' part is one of approval or disapproval. In the case of open market policy, the Reserve Banks'
part in policy determination
is exercised through five of the
Reserve Bank presidents who, in rotation, share with the Board
of Governors in membership in the Federal Open Market Committee. On the less frequent occasions when changes are made
in the reserve requirements of member banks (within statutory
limits) the primary responsibility and final decision rest solely
upon the Board of Governors. The views of the Reserve Bank
presidents, however, may be solicited from time to time.

change.,
if any,

crnd

three offices combined

Whether measured in physical units of work
load or in the dollar volume of transactions, most
phases of the bank's service operations increased
during 1955. At the same time, the number of
employees showed a slight decline.
Continuing an outstanding
growth trend, the
number of checks handled at the three offices rose to
about 322 million for the year, or 6 percent above
the large volume of 1954. Each of the postwar
years,without
exception, has seen a rise in the
load of check clearance. Since 1950, as visible on
the chart, the rise has been rapid.
Post office money orders, which are included
within the figures for total checks handled, represent one type of instrument
whose use has declined somewhat in recent years. Nonetheless, 26
million of such items were handled by this bank
during 1955.

throughout the year. Issues of notes and certificates were, as usual, less regular than sales of
bills, but there were
four months of especially heavy volume
in notes and certificates - namely,
April, May, October
and December. Altogether, sales of $4.7
billion in Treasur y
issues of the various
types were handled
by this bank during
the year;-a
volume
larger than in anv
postwa r year except
1954.

The demand for coin by business and consumers
during 1955 was unusually large. About $93 million in coin was paid out by the three offices of
this bank, in order that commercial banks might
meet the public demand. That represented a rise
of 18;percent from the previous year's total. As
shown by the chart, the marked trend toward use
of wrapped coin was continued during the year.
Currency payments also increased. Slightly over
$2 billion in currency was paid out by the three
offices, amounting to an 11 percent increase for the
year.
Sales of Treasury issues, handled by this bank
as fiscal agent of the United States, increased during the year in each of the major categories except
bond issues. Sales of Treasury bills were at a fairly
steady pace, averaging $242 million per month

18
<.

COIN

PAYMENTS

Millions of Dollo"

100r-~------------~~------------~~

25

Savings bond sales handled for the United States

chart

Treasury by the three offices totaled more than 13
million pieces, or within one-half percent of the
large number
year.

of bonds handled

was carried

see

by a slightly

reduced

staff of emat

mid-year was 1615, or 28 below the number of em-

a cen-

ployees at the three

function somewhat distinct from the

service operations under consideration

of such lending,

ployees. As shown by the chart, the number

The increased volume of lending to member banks
tral-banking

the extent

The generally increased work load during 1955

in the previous

which occurred during the year represents

showing

page 1I.

offices in mid-1954.

That

represents the third year of moderate reduction.

here. For a

"TIttw$ond.

2.5

r'----------

--~--

__;

2.0---------------------------1
t

19

the Pittsburgh Branch begins a building program
next door and 8,000 square feet in another nearby
building.
The main banking room on the first floor will
be remodeled and modernized. The large 2Yz-story
windows will be removed and the openings
blocked in.
There will be three new passenger elevators, one
freight elevator and one coin elevator, all automatically operated. The two present passenger
elevators and the security elevator will be modernized. The new coin vault in the basement of the"
large addition will provide ample accommodations
for the storage of wrapped and loose coin.
The entire new additions will be fully air conditioned to tie in to the existing air-conditioning
installation.

Construction of additions to the Pittsburgh
Branch building totaling 79,000 square feet of
floor space was begun September 1, 1955, following authorization by the bank's Board of Directors and by the Board of Governors of the Federal
Reserve System at Washington, D. C. Completion
is scheduled for the summer of 1957.

The present Pittsburgh Branch building (without the present front
entrances) is shown on the left. At the right is the architect's drawing of the ten-story addition which will include the new main
entrance.

The additions, first to be made since the present
structure with its 49,000 square feet of floor space,
was completed in 1930, will comprise two sections:
One will be a rectangular 10-story building fronting 50 feet on Grant Street, adjoining the present
building on the north and extending 140 feet to a
westerly frontage on William Penn Way. The
other will be a six-story rear section of the present
building, bringing that part to the eight-story
height of the existing structure. When the new
additions are completed, the present entrance will
be closed off and the main entrance will be on the
Grant Street front of the ten-story addition.
The additions will enable the Branch to vacate
13,000 square feet it now uses in the Gulf Building

Breaking ground for the new Pittsburgh Branch addition are, foreground,
left to right: John W. Kossin, vice president in charge of the Branch; E. P.
Mellon I I, board chairman, Mellon-Stuart
Company, contracting-engineering firm; President Wilbur D. Fulton; Mayor David L. Lawrence of Pittsburgh; Henry A. Roemer [r., chairman of the Pittsburgh Branch board. In
background, from left are:
Donald S. Thompson, first vice president of the bank; Dr. John C. Warner,
Branch director; Lawrence N. Murray, president, Mellon National Bank
and Trust Company, Pittsburgh, and former director of the bank; Douglas
M. Moorhead of North East, Penna., Branch director; Albert H. Burchfield [r., president, Joseph Horne Company, Pittsburgh, and former Branch
director; Thomas C. Swarts, president, Woodlawn Trust Company, Aliquippa, Penna., and former Branch director; Arthur C. Foster, cashier
of the Branch.

20

\Troy•

- - - T- -

,,

:

,,

-L-J._~pri:9field
'-

I

" Dayton·
I

•

--- F-'---T----,
,
,

Xenia',

• Middletow1
I
,
• Hammeln
I

--

_...L{-

L

,

I

~orwood

'

/

l l
I

I
---,

~

''r------i

OH I (!)

,
,,,

_

--

,_
, L.

I
L~
I
I

--I.,

~_,

I

I

I
I

industry and agriculture

in the
area served by the Cincinnati Branch

Diversification
of industry
in the territory
served by the Cincinnati Branch is a fact rather
than a slogan. Manufacturing
of a wide variety of
products in both the hard-goods and soft-goods
lines is supported by strength in transportation
facilities, in the extractive
industries
and in
agriculture.

Leading Machine

Tool Area

Cincinnati continues to be a leading center for
the production
of machine tools-an
industry
which dates back to 1817 when it began as a byproduct of the steamboat-building
industry. Other
types of machinery, as well as a wide variety of
primary and fabricated metal products, are produced in quantity in the area. Important manufacturing centers for metal products in general
include: Cincinnati, Dayton, Hamilton, Middletown,
Springfield,
Portsmouth,
Chillicothe,
Marietta,
Ironton,
and Troy-all
in southern
Ohio; also, Covington,
Newport,
Lexington,
Winchester, Ashland, and Richmond, in eastern
Kentucky.
Aircraft

engines and parts are manufactured

Jet engine manufactured

in

Die sinking

~

I

~

Cincinnati

sky line

22

near Cincinnati

machine produced in Cincinnati

Paper making in the Miami

One of world's largest soap-making

Cutting coal in a Kentucky

valley

Oil refinery in Ashland,

plants

Kentucky

The river towboat links the early history of the
Cincinnati area with its modern network of transportation facilities.
Millions of tons
of products
are
shipped annually
to or from the Cincinna ti river port;
also, eight trunk
line railroads, five
airlines, and 128
common-carner
truck lines serve
the center.

Cincinnati, Evendale, and Dayton, as well as in
several other centers. Computing machines, cash
registers, and household appliances are outstanding products of Dayton. The office-furniture
industry is important
in Mariet ta and Norwood,
Ohio.

Nondurable

mine

Goods

Soft-goods manufacturing
lines are represented
in the area by numerous enterprises
(some of
which are among the world's largest) for the manufacture of soaps, chemicals, paper, petroleum
products, shoes, textiles, and apparel. The Miami
River valley and Chillicothe, for example, are
historic centers of paper manufacturing;
large
new chemical plants have been built in recent
years at various sites along the Ohio River. Meat
packing, once a leading industry in Cincinnati, is
still an important
factor; large food processing
plants also are located in Dayton, Piqua, and
Troy.

23

Coal Mining
Coal mining has played a large part in the economic life of 27 counties in eastern Kentucky and
7 counties in southeastern Ohio. The troubles of
the industry, stemming in part from the inroads
of competitive fuels, have been reflected in the
employment patterns of such areas, as in other
coal sections of the nation. However, 1955 was a
much better year for coal mining than its predecessor, and in some respects the general outlook
for the industry is considered to be improved. In
eastern Kentucky, for example, the tonnage for
the year 1955 is estimated at about 20 percent
above the 1954 output. The recent industrial expansion of the entire Ohio Valley has come about
partly through the availability of coal as a source
of power.

Burley tobacco in a Lexington

warehouse

Corn and small grains are important crops
grown on the farms of the area. Production of
hogs, cattle, and sheep, as well as dairying enterprises, is common. In southeastern Ohio can be
found a thriving broiler industry and the area is
strong in truck gardens producing fresh market
vegetables.
The bluegrass area around Lexington, Kentucky, is famous as a breeding place for thoroughbred race horses.

Sheep raising in south central Ohio

Large atomic energy plants, operated by private
industry for the Atomic Energy Commission, are
located in Pike County, near Waverly, Ohio,
and in Hamilton County, near Cincinnati.

Agriculture
In the area served by the Cincinnati Branch
may be found many types of agricultural endeavor.
One of the principal items produced is burley
tobacco, which provides a large portion of the
cash income on many of the smaller farms located
in the burley belt of Kentucky and Ohio. The
market at Lexington, Kentucky, is the largest in
the world. Cigar leaf tobacco is produced In
several counties of southwestern Ohio.

24

from the

LOG BOOK

of the Cincinnati Branch

1917

1943

November 21. First meeting of the board of directors held in
the offices of the First National Bank of Cincinnati.
December 4. Decision made to lease quarters for the Branch
in the Union Savings Bank and Trust Company Building.
December 14. Manager 1. W. Manning announces plans for
employmen t of necessary office force.

March 10. B. ]. Lazar appointed vice president.
April 26. Inscription
division is added to fiscal agency
function.
April 21. Reissue division of fiscal agency function is opened.
May 1. Entire fourth floor of the Chamber of Commerce
Building leased to be used by the expanded fiscal agency
departmen t.

1918

1944

January 2. Opening date for the Branch definitely fixed by
the Federal Reserve Bank of Cleveland to be January 10, 1918.
January 10. The Cincinnati
Branch formally opened for
business with twenty-five
employees. The Federal Reserve
Bank of Cleveland advises that there be designated
for the
Branch an additional officer who might perform the duties of
cashier, or such other duties as might be prescribed by the
board or required by the manager, pending the appointment
of
a cashier by the Federal Reserve Bank of Cleveland.
February 19. First examination
of the Branch made by the
auditor ofthe Federal Reserve Bank of Cleveland.

January 1. Department
of general accounting opened at the
Branch.
April 1. Functioning
of registered bonds assumed by fiscal
agency department.
Bestowal of full fiscal agency powers on
the Branch.
August 18. Increased volume of savings bond redemptions
requires
leasing of additional
lobby space in the Neave
Building.
November 1. War Loan Accounts unit established
in the
Branch.

1920

1945

November 20. Option closed for the purchase
at Fourth and Race Streets.

of the property

June 4. Number
number of 503.

1921

January 20. Structural
changes and relocation of departments begun in the quarters of the Branch, including the installation of a coin vault in the basement.

Bank Building
of war savings

1949

March 1. Wilbur D. Fulton, former vice president in charge
of bank examination
at main office, becomes vice president in
charge of the Cincinnati Branch. He succeeds B.]. Lazar, who
retires after 31 years of service.

Director
resigned.
of Post

1950

AprilS.
The Cincinnati Clearing House Association
into new quarters in the building.
July 24. Employees' cafeteria opened.

1928
3. Branch
building.

moves into new quarters

in Chamber

the record

1948

1926

January
Commerce

reaches

September 2. Announcement
of purchase of the fifteen-story
Chamber of Commerce Building, to be renamed the "Federal
Reserve Bank Building."
September 15. Employees of the Branch begin working on a
five-day week.
December 16. The first order for wrapped coin filled as Branch
ships $100 in wrapped cents to a state member bank in Richmond, Kentucky.

1923

April 1. Clifford F. McCombs appointed Managing
of the Cincinnati Branch to succeed 1. W. Manning,
September 8. Application
made for establishment
Office sub-station.

employees

1947

February 11. The United States sub-Treasury
of Cincinnati
discontinued
and its functions
assumed by the Cincinnati
Branch. Operations of cash and bond exchange departments
transferred
to Federal Building in space previously occupied
by the sub-Treasury.
March 6. First examination of the Cincinnati Branch by examiners from the Federal Reserve Board.
July 6. Due to overload of vaults in Federal Building, arrangements made to lease vault in St. Paul Building for storage
of coin.
January 3. Fifth Floor of the Atlas National
procured for use in connection with redemption
stamps.

of Branch

of

1951

July 1. Beginning of new operation of processing
money orders by punched-card
system.

1935
February 28. Clifford F. McCombs, Managing Director, retires at age 73-the
first officer of the Cincinnati
Branch to
be retired.
March 1. Following appointments
made, effective immediately: B. J. Lazar, Managing
Director; H. N. Ott, Cashier;
R. G. Johnson, Assistant Cashier; Clyde Harrell, Acting Assistant Federal Reserve Agent.

moves

Post Office

1953

January 1. Wilbur T. Blair becomes vice president in charge
of the Cincinnati Branch. He succeeds Wilbur D. Fulton, who
moves to the main office as First Vice President of the Federal
Reserve Bank of Cleveland.
April 16. Work started
on air conditioning
the Branch
Building.
July 15. Richard G. Johnson succeeds Wilbur T. Blair as
vice president in charge of the Cincinnati Branch.

1937
January 25. Currency in the vaults of some member banks
under water from the flood condition of the Ohio River. Cleaning, drying, and pressing of currency undertaken
at the Branch.

1954

May 1. Branch designated as depository
posits in the Fourth District.

1942
December 4. Board' of Directors of the Branch approves procedure in regard to "Evacuation
of Valuables and Records in
the Event of an Air Raid."
October 1. The fiscal agency department
begins work of bond
redemptions.

for Post

Office de-

1955

January 31. Work started on security court.
November 21. Security court first used for receipt
livery of shipments of money and valuables.

25

and de-

I

past directors

WILLIAM

C. PROCTER

WILLIAM

S. ROWE

CHARLES

A.

JUDSON

HINSCH

HARMON

GEORGE

D.

THOMAS

J . DAVIS

CHARLES
E.

W.

LEE

OMWAKE

CLIFFORD

GEORGE
A.

DUPUIS

SHACKLEFORD

JOHN
A.

CRABBS

E.

SHINKLE

M.

VERITY

ANDERSON

BERNARD

FRED

H.

A.

KROGER

GEIER

THOMAS

J.

DAVIS

CHARLES

·

I
I
i

i

N.

MANNING

\VILLIAM

H.

COURTNEY

STUART

B.

JOHN

ROWE

J.

SUTPHIN

ALEXANDER
FRANK

A.

THOMSON
BROWN

BUCKNER

WOODFORD

1

FRANCIS

H.

BIRD

JOHN

GUTTING

'~

I

i

G.

FREDERICK
WALDO

V. GEIER

E.

PIERSON

S. HEADLEY

SHOUSE

WALTER

H.

PAUL

G.

BLAZER

NEIL

McELROY

SPEARS

J.

BEHM

TURLEY

ERNEST

H.

JOSEPH

B. HALL

STERLING
HENRY

HAHNE

B.

C.

GRANVILLE

CRAMER

BESUDEN
R.

LOHNES

of the Cincinnati Branch •

Procter & Gamble Company, Cincinnati, Ohio
President, The First National Bank of Cincinnati, Cincinnati, Ohio
President, The Fifth Third National Bank, Cincinnati, Ohio
Atterney, Cincinnati, Ohio
President, The Philip Carey Company, Cincinnati, Ohio
Chairman of the Board, The First National Bank of Cincinnati, Cincinnati, Ohio
President, The Citizens National Bank & Trust Company, Cincinnati, Ohio
President, The First National Bank and Trust Company of Covington,
Covington, Kentucky
President, U. S. Playing Card Company, Cincinnati, Ohio
President, The Fourth & Central Trust Company, Cincinnati, Ohio
President, American Rolling Mill Company, Middletown, Ohio
Moores-Cooney Company, Cincinnati, Ohio
Chairman of the Board, The Provident Savings Bank and Trust Company,
Cincinnati, Ohio
President, Cincinnati Milling Machine Company, Cincinnati. Ohio
Chairman of the Board, The First National Bank of Cincinnati, Cincinnati, Ohio
President, Security Trust Company, Lexington, Kentucky
President, The First National Bank and Trust Company of Lexington,
Lexington, Kentucky
President, 1. V. Sutphin Company, Cincinnati, Ohio
President, The Fifth Third Union Trust Company, Cincinnati, Ohio
Chairman of the Board, Champion Paper & Fibre Company, Hamilton, Ohio

President,

Farmer, Clarksburg, Ohio

Bank & Trust Company,
Paris, Kentucky
Dean, College of Business Administration, University of Cincinnati,
Cincinnati, Ohio
President, The Second National Bank of Cincinnati, Cincinnati, Ohio
President, Cincinnati Milling Machine Company, Cincinnati, Ohio
President, The First National Bank of Cincinnati, Cincinnati, Ohio
Tobacco and livestock raiser, Lexington, Kentucky
President, The Winters National Bank and Trust Company of Dayton,
Dayton, Ohio
Chairman of the Board, Ashland Oil & Refining Company, Ashland, Kentucky
President, Procter & Gamble Company, Cincinnati, Ohio
Vice President and Trust Officer, State Bank and Trust Company of Richmond,
Richmond, Kentucky
President, Miami University, Oxford, Ohio
President, The Kroger Company, Cincinnati, Ohio
First Vice President, The Fifth Third Union Trust Company, Cincinnati, Ohio
Vice President

and Cashier, Bourbon-Agricultural

Sheep raiser, Winchester, Kentucky
Treasurer, National Cash Register Company, Dayton, Ohio

Security Trust Company, Lexington, Kentucky
Ohio University, Athens, Ohio
President, The First National Bank of Cincinnati, Cincinnati, Ohio

EDWARD

S. DABNEY

President,

JOHN

C.

BAKER

President,

FRED

A.

DOWD

26

1917-1920
1917-1922
1917-1923
19l7-1925
1920-1923
1923
1924-1929
1924-1932
1924-1935
1925-1926
1925-1936
1926
1926-1936
1927-1934
1930-1935
1933
1934-1940
1934-1941
1936-1942
1937-1939
1939-1944
1940-1945
1942-1948
1943-1945
1943-1946
1945-1949
1945-1949
1945-1950
1945-1950
1946-1948
1946-1951
1949-1952
1949-1954
1950-1952
1950-1955
1951-1953
1952-1954
1952-1954
1953-1955

guiding

the Cincinnati Branch

today

DIRECTORS

ANTHONY HASWELL (Chairman)
President, The Dayton Malleable
Iron Company, Dayton, Ohio

LEONARD M. CAMPBELL,
President, The Second
National Bank of Ashland
Ashland, Kentucky

W. BAY IRVINE,
President, Marietta College
Marietta, Ohio

IVAN JETT,

ROGER DUCKETT,
President, The Drackett
Company
Cincinnati, Ohio

Farmer,

Georgetown, Kentucky

WILLIAM A. MITCHELL,
President, The Central
Trust Company
Cincinnati, Ohio

BERNARD H. GEYER,
President, The Second
National Bank of Hamilton
Hamilton, Ohio

RICHARD

PHIL J. GEERS,

G. JOHNSON,

Cashier of
the Cincinnati Branch

Vice President of the
Federal Reserve Bank of
Cleveland, in charge of
the Cincinnati Branch

27

Comparative statement of condition
December 30,1955 and December 31,1954

assets

Dec. 30, 1955

TOTAL

Federal Reserve
Other cash

GOLD

1,780,563,728

1,794,477,052

17,923,050
27,269,610

16,882,000
37,499,357
1,848,858,409
14,636,667

129,146,000
508,843,000
1,217,461,000
240,791,000

CERTIFICATE

185,727,000
1,189,814,000,
517,436,000
240,130,000

2,096,241,000

2,133,107,000

2,096,857,000

notes .....

$1,717,478,423
76,998,629

616,000

Reserve

$1,702,370,444
78,193,284

1,825,756,388

Gold certificates.
Redemption
fund for Federal

Dec. 31, 1954

2,147,743,667

RESERVES.

notes of other banks.
.

TOTAL

CASH

Discounts and advances ..
U. S. Government
securities:
Bills.
Certifica tes
.
Notes
.
Bonds
.
TOTAL

U.

TOTAL

LOANS

S. GOVERNMENT

SECURITIES.

AND SECURITIES.

Uncollected cash items.
Bank premises ..
Other assets ....
TOTAL

653,563,169
5,905,373
13,552,762

371,458,534
5,260,131
11,329,889

$4,595,634,692

$4,384,650,630

$2,492,709,245

ASSETS.

$2,417,960,675

liabilities
Federal

Reserve

notes.

Deposits:
Member bank-reserve
U. S. Treasurer--general
Foreign ....
Other deposits
TOTAL

1,492,811,500
26,036,179
35,126,000
12,883,559

cash items

.
.

1,567,514,249

432,140,750
1,184.439

.

1,467,287,399
42,858,260
44,344,000
13,024,590

1,566;857,238

.

DEPOSITS

Deferred availability
Other liabilities
TOTAL

accounts.
account ...

299,651,925
1,120,605

4,492,891,672

LIABILITIES.

4,286,247,454

capital accounts
Capital paid in ...
Surplus (Section 7) ..
Surplus (Section 13b).
Other capital accounts.
TOTAL

LIABILITIES

29,295,950
62,563,178
1,005,665
9,878,227
AND CAPITAL

Contingent
liability on acceptances
Industrial loan commitments.

purchased

27,318,050
60,222,039
1,005,665
9,857,422

$4,595,634,692

ACCOUNTS ...

for foreign correspondents.

~,650,630

s

s
s

$

28

3,048,500
321,632

1,766,400
598,300

Comparison of earnings and expenses
FOR THE YEARS 1955 AND 1954
1954

1955
1>

Total current earnings.
Net expenses .........

27,290,869

-{l16,316

(net) .

TOTAL DEDUCTIONS.
...

Net earnings before payments to U. S. Treasury.
Paid U. S. Treasury (interest on F. R. notes).
Dividends ..
to surplus

(Section

s

7).

30,171

5,945

securities

28,716
1,455

-{l-

. ........

56,844

74
20,806
1,381

(net).

45,288
11,556

22,261

Deductions from current net earnings:
Loss on sales of U. S. Government
Reserves for contingencies
All other ...

Transferred

37,422,140
10,131,271

16,316

securities

TOTAL ADDITIONS.

Net additions.
Net deductions

s

25,101,843

CURRENT NET EARNINGS..
Additions to current net earnings:
Profit on sales of U. S. Government
All other .......

35,055,198
9,953,355

26,673
-0-

25,095,898
21,070,509
1,684,251

27,317,542
23,166,338
1,577,114

2,341,138

TO U. S. TREASURY

Disposition of Gross Earnings, 1955
29

-{)-

1>

2,574,090

DIRECTORS
JOHN C. VIRDEN (Chairman)
Chairman of the Board, John C. Virden Company, Cleveland, Ohio
ARTHUR B. VAN BUSKIRK (Deputy Chairman)
Vice President and Governor, T. Mellon and Sons, Pittsburgh, Pennsylvania
KING E. FAUVER, Director
The Savings Deposit Bank and Trust Company
Elyria, Ohio

J. BRENNER ROOT, President
The Harter Bank & Trust Company
Canton, Ohio

JOSEPH B. HALL, President
The Kroger Company
Cincinnati, Ohio

ALEXANDER E. WALKER, Chairman
of the Board
The National Supply Company
Pittsburgh, Pennsylvania

CHARLES Z. HARDWICK,
President
The Ohio Oil Company
Findlay, Ohio

Executive Vice

FRANK J. WELCH, Dean and Director
College of Agriculture and Home Economics
University of Kentucky
Lexington, Kentucky

EDISON HOB STETTER, President and
Chairman of the Board
The Pomeroy National Bank
Pomeroy, Ohio

MEMBER OF FEDERAL ADVISORY COUNCIL
(From the Fourth

Federal Reserve District)

FRANK R. DENTON
Vice Chairman of the Board
Mellon National Bank and Trust Company
Pittsburgh, Pennsylvania

CINCINN ATI BRANCH
DIRECTORS
ANTHONY HASWELL (Chairman)
President, The Dayton Malleable Iron Company, Dayton, Ohio
LEONARD M. CAMPBELL, President
The Second National Bank of Ashland
Ashland, Kentucky

W. BAY IRVINE, President
Marietta College
Marietta, Ohio

ROGER DRACKETT, President
The Drackett Company
Cincinnati, Ohio

IVAN JETT, Farmer
Georgetown, Kentucky

BERNARD H. GEYER, President
The Second National Bank of Hamilton
Hamilton, Ohio

WILLIAM A. MITCHELL, President
The Central Trust Company
Cincinnati, Ohio

OFFICERS
RICHARD G. JOHNSON, Vice President
PHIL J. GEERS, Cashier
JOHN BIERMANN, JR., Assistant Cashier
GEORGE W. HURST, Assistant Cashier

30

WALTER H. MacDONALD, Assistant

Cashier

OFFICERS
WILBUR D. FULTON, President
DONALD S. THOMPSON, First Vice President
PHILLIP B. DIDHAM, Assistant Vice President
DWIGHT L. ALLEN, Vice President
CLYDE HARRELL, Assistant Vice President
ROGER R. CLOUSE, Vice President
and Secretary
JOSEPH M. MILLER, Assistant Vice President
GEORGE H. EMDE, Cashier
HUGH M. BOYD, Chief Examiner
L. MERLE HOSTETLER, Director of Research
GEORGE T. QUAST, Assistant Chief Examiner
RICHARD G. JOHNSON, Vice President
CHARLES J. BOLTHOUSE, Assistant Cashier
JOHN W. KOSSIN, Vice President
CHARLES E. CRAWFORD, Assistant Cashier
ALFRED H. LANING, Vice President
ELWOOD V. DENTON, Assistant Cashier
:VIARTIN MORRISON, Vice President
EDWARD A. FINK, Assistant Cashier
HAROLD E. J. SMITH, Vice President
ELMER F. FRICEK, Assistant Cashier
PAUL C. STETZELBERGER, Vice President
HARMEN B. FLINKERS, Assistant Secretary
CARL F. EHNINGER, General Auditor

INDUSTRIAL ADVISORY COMMITTEE
HERMAN R. NEFF (Chairman)
Chairman of the Board, The George S. Rider Company-Engineers,

Cleveland, Ohio

HERBERT P. LADDS (Vice Chairman)
President, National Screw and Manufacturing
Company
Cleveland, Ohio

JOHN P. McWILLIAMS, President and
Chairman of the Board
Youngstown Steel Door Company
Cleveland, Ohio

SAM W. EMERSON, President and Treasurer
The Sam W. Emerson Company
Cleveland, Ohio

ARTHUR W. STEUDEL, President
Sherwin-Williams Company
Cleveland, Ohio

PITTSBURGH

BRANCH

DIRECTORS
HENRY A. ROEMER, JR. (Chairman)
President, Forbes Steel Corporation, Canonsburg, Pennsylvania
JOHN H. LUCAS, Chairman of the Board
Peoples First National Bank & Trust
Company
Pittsburgh, Pennsylvania

ALBERT L. RASMUSSEN, President
The Warren National Bank
Warren, Pennsylvania

DOUGLAS M. MOORHEAD, Farmer
North East, Pennsylvania

JOHN C. WARNER, President
Carnegie Institute of Technology
Pittsburgh, Pennsylvania

SUMNER E. NICHOLS, President
Security-Peoples Trust Company
Erie, Pennsylvania

IRVING W. WILSON, President
Aluminum Company of America
Pittsburgh, Pennsylvania

OFFICERS
JOHN W. KOSSIN, Vice President
ARTHUR G. FOSTER, Cashier
W. HUNTER NOLTE, Assistant Cashier
JOHN R. PRICE, Assistant Cashier

JOHN A. SCHMIDT, Assistant Cashier
ROY J. STEINBRINK, Assistant Cashier

31

Promotions and Retirements

The following promotions,
changes or retirements of officers of the bank became effective
during 1955:
Retirement. JAMES R. LOWE, Assistant
President, retired as of June 30.

Vice

Changes and Promotions. EDWARD A. FINK became Assistant Cashier as of January 1.
ALFRED H. LANING, Vice President and Cashier,
relinquished duties of Cashier on July 1.
The following
July 1:

promotions

GEORGE H. EMDE, formerly
President, became Cashier.

became

effective

Assistant

Vice

CLYDE HARRELL, formerly Assistant
Cashier
of the Cincinnati Branch, became Assistant Vice
President of the bank.
WALTER H. MACDONALD, formerly Assistant
Examiner, became Assistant Cashier of the Cincinnati Branch.
GEORGE T. QUAST, formerly Senior Examiner,
became Assistant Chief Examiner.

32

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