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Eleventh Annual Report

Federal Reserve Bank
of New York
For the Year Ended December 31, 1925

®
Federal Reserve Agent
Second Federal Reserve District




Eleventh Annual Report

Federal Reserve Bank
of New York
For the Year Ended December 31, 1925

Federal Reserve Agent
Second Federal Reserve District




Contents
PAGE

Letter of Transmittal

2

Business Conditions in 1925

3

Banking Conditions

4

Gold Movement

6

Improyement in European Monetary Conditions

7

Foreign Financing

8

Gold Credit to Bank of England

9

Arrangements with Poland and Belgium

11

Reports of Operation

12

Statement of Condition

12

Discount Rate

14

Income and Disbursements

14

Volume of Operations

15

Election of Directors

16

Member of Advisory Council

17

Officers and Staff

17

Building and Annex

18

Conferences with Bankers
Directors and Officers

18
20




FEDERAL RESERVE BANK
OF N EW YORK

New York, January SO, 1926.

SIRS:

I have the honor to submit herewith the eleventh annual report of the
Federal Reserve Bank of New York,
covering the year 1925.
Respectfully,
PIERRE JAY,

Chairman and Federal Reserve Agent.

FEDERAL RESERVE BOARD,

Washington, D. C.




Business Conditions in 1925
The tendencies in business and credit in the Second District
during the past year have generally reflected conditions in the country as a whole. Nineteen twenty-five was a year of exceptional
business activity. An index of the total volume of trade throughout the country, shown in diagram 1, indicates a larger volume of
business than in any other recent year. It was a year of good business profits, as a result partly of the large volume of business and
partly of the rapid introduction into business in the past few years
of various economies in operation. Industrial employment increased
during the year and earnings of factory workers were at a high
level. Commodity prices remained with some fluctuations at a
level between 55 and 60 per cent, above the 1913 average.
PER CENT
175

PER CENT.
115

1923

192,4

1925

1. The Volume of Trade was maintained at a high level during 1925 and prices after some
fluctuations showed little net change for the year.

While business was largely free from speculative tendencies the
volume of trading in the stock market reached new high levels and
the prices of stocks rose to new high points, under the impetus of
wide participation in the market and a large flow of funds from outof-town to New York for employment in the stock exchange money



3

4

ELEVENTH ANNUAL REPORT

market. During the summer there was heavy trading in grain, but
with that exception speculation was not unusually active in the
commodity markets. There was, however, evidence of large speculative undertakings in real estate in various parts of the country.

Banking Conditions
The large volume of business in 1925 was carried forward with a
somewhat smaller additional extension of bank credit than in 1924
when business was less active. The figures now available indicate
an increase during the year of about 1% billion dollars, or 6 per cent.,
in the loans and investments of all member banks throughout the
country, as compared with an increase in 1924 of about 2K billion
dollars, or 9 per cent.
The increase in bank credit in 1925 may be largely ascribed to a
growth of about one billion dollars in time deposits, which reflects
the normal accumulation of funds from year to year, rather than the
extension of additional credit for business use. The funds received
by banks as time deposits were largely employed by banks in loans
on stocks and bonds. There were much smaller increases in demand
deposits and in loans directly for commercial purposes.
In the Second Federal Reserve District, in contrast with the rest
of the country, bank loans and deposits showed no increase until
the last few weeks of the year. Early in the year, accompanying
gold exports, banks lost about 400 million dollars of deposits and
liquidated a substantial amount of their investments. An additional factor in this reduction of bank deposits was a reduction of
about 200 million dollars in balances of out-of-town banks in New
York City.

1924

1925

2. Bank loans and investments and deposits in the Second District showed little net
change during 1925, but in other districts continued to increase.
(Reporting member banks in principal cities)



FEDERAL RESERVE BANK OF NEW YORK
There was an interesting contrast during 1925 in the growth of
bank credit in cities of different sizes. In general, smaller towns
and cities showed a more rapid increase in deposits than did the
larger centers. Changes during the year through November in total
time and demand deposits of all member banks were as follows:
Deposits in all member banks (In millions of dollars)
SECOND DISTRICT

DATE

OTHER 11 DISTRICTS TOTAL UNITED STATES

Cities and Cities and Cities and Cities and Cities and Cities and
Towns
Towns
Towns
Towns
Towns
Towns
Under
Over
Over
Under
Over
Under
100,000
100,000
100,000
100,000
100,000
100,000
Population Population Population Population Population Population

Dec. 24, 1924
Nov. 25, 1925

1,391
1,537

7,155
7,054

8,160
8,805

10,977
11,658

9,551
10,342

18,132
18,712

Change

+146

—101

+645

+681

+791

+580

The comparative stability of demand deposits during the year
in the face of active business may be partly accounted for by the
fact that the increase in deposits in 1924 had been larger than usual.
During the year 1925, moreover, there was a steadily more active
utilization of the available deposits, as is indicated by the following diagram showing the velocity, or rate of turnover, of bank
PERCENT

125

NORMAL

100

1923

1924

192,5

3. The velocity, or rate of turnover, of bank deposits was more rapid in 1925 than for
some years previous. (Estimated normal equals 100 per cent.)




6

ELEVENTH ANNUAL REPORT

deposits. Velocity is computed by finding the ratio between the
amount of checks drawn each month and average demand deposits.
The figures are shown in the diagram as percentages of an estimated
normal velocity determined from past experience.
In New York City there was a greater increase in velocity of
deposits than in the rest of the country, probably reflecting activity
in the security markets.
GOLD MOVEMENT

An important influence in the credit situation in 1925 was the
reversal of the gold movement from an import movement in 1924 to
an export movement in 1925. The total figures for the year show a
net export movement of about 135 million dollars, the major part
of which was exported from New York. The largest amount of
the exported gold went to Germany, representing part of the proceeds of the $110,000,000 German loan provided for in the Dawes
Plan, together with gold which had been held under earmark in this
bank. This gold was transferred to the vaults of the Reichsbank to
serve as reserve for the reestablished currency of Germany. Considerable amounts were also exported to India and Australia,
reflecting a position of the exchanges of those countries which made
gold imports profitable. Most of this gold export movement took
place in the early months of the year.
MILLIONS
OF DOLLARS

1 i

+100

EXC ESSOF

,
l

+ 50

i

X)RTS

>ll F

u
1
lEXCE

55 OF

w

FEXP<DRTS

-1.00
1914 1915 1916 1917 1918 1919 1920 1921 192.2 1923

1925

4. The gold movement in 1925 resulted in a net export total for the first year since 1919.




FEDERAL RESERVE BANK OF NEW YORK

7

After the return of Great Britain to the gold standard, gold
movements to and from this country began to reflect much more
nearly than for some years past the readjustments of exchange positions which were usual prior to the European war. In October sterling exchange dropped below the British gold export point and more
than 40 million dollars of gold was shipped to this country, a movement somewhat similar in time and amount to the seasonal movement in many years prior to the war. This import movement,
however, was offset by a movement of gold from this country to
Canada, which resulted from a rise in Canadian exchange above
their import point at the time when considerable shipments of
wheat were being received in this country from Canada.
Gold Movement, 1925 (In thousands)

Country

Imports

Exports

Excess of
Imports

France
Germany
Netherlands
England
Canada
Mexico
Argentina
Australia
Straits Settlements
Japan
China and Hong Kong.
British India
All other
Total.

$ 6,606
2
10,085
49,294
32,833
5,387
2
2
14
11,008
120

1,339
68,270
4,318
6,160
45,658
8,810
7,573
26,925
7,377

Exports

$ 5,267

5I767

$ 68,268

43,134
12,825
3,423
7,571
26,923
7,363
11,008

12,920

i'3,478
58,775
13,957

13,358
58,775
1,037

$128,273

$262,640

$ 134,367

Improvement in European Monetary Conditions
The year 1925 was a year of notable progress in the recovery of
the nations of Europe to monetary stability. The inauguration of
the Dawes Plan in the autumn of 1924 paved the way for the restoration of Germany to a gold basis, and the program laid down at that
time for 1925 was successfully carried through. In January 1925,
South Africa announced the intention to resume gold payments;
in March Austria adopted a new currency; and on April 28 Great
Britain reestablished a free gold market and its action was accompanied by similar action on the part of Holland, Australia, New
Zealand, and the Dutch East Indies. Eighteen countries, constituting a considerable proportion of Europe, have now taken definite



8

ELEVENTH ANNUAL REPORT

action to return to the gold standard or a gold exchange standard,
or have reached substantial stability. Important steps taken in
these directions by European countries are shown in the following
calendar.
1922
September Bank of Lithuania established and new currency unit adopted,
based upon gold.
Oetober
Russian Soviet State Bank authorized to issue the chervonetz,
based upon gold.
November Bank of Latvia established and new currency created, to become
convertible into gold one year after the resumption of gold payments by the Bank of England.
1923
January
Austrian National Bank established.
October
German Rentenbank established, and currency stabilized.
1924
January
Bank of Danzig established and currency stabilized with reference
to sterling.
April
Sweden removes restrictions upon gold exports and resumes specie
payments.
Bank of Poland established, and new currency introduced, based
on gold.
June
Hungarian National Bank established and currency stabilized with
reference to sterling.
October
German Reichsbank reorganized under the Dawes Plan and new
reichsmark introduced.
December Germany removes restrictions on the export and import of gold
and silver.
1925
January
South Africa announces intention to resume gold payments July 1,
1925.
March
Austria announces adoption of new currency.
April
Great Britain reestablishes free gold market. Holland, Australia,
New Zealand, and Dutch East Indies withdraw embargo on gold
exports.
Czecho-Slovakia passes act providing for a new currency unit based
on gold and the establishment of the National Bank of Czechoslovakia to open in January 1926 to replace the Banking Office of
the Ministry of Finance under whose operations substantial monetary stability had been secured.
July
Albania passes laws providing for a national currency based upon
the gold franc and a central bank to open in January 1926.
November Hungary adopts new currency unit.
December Finland passes law providing for revalorization of the currency
on gold basis, effective January 1, 1926.

These formal steps which have been taken by different countries
to restore their monetary positions do not mark a complete return
to monetary stability. Certain of the countries have had difficulty
in maintaining the programs which they had laid down. Many of
the countries are short of liquid capital and will require additional
extension of credit by other countries.

Foreign Financing
A continued large volume of foreign financing in the United
States has undoubtedly been an important factor in the improvement in financial conditions abroad and has facilitated the marketing



FEDERAL RESERVE BANK OF NEW YORK

»

abroad of American exports. During the year 1925 a total of
$1,326,900,000 of new foreign securities was sold in this country,
as compared with about $1,250,000,000 in 1924, which had up to
that time been the largest amount of new foreign financing ever
placed in this country, if we except the war issues of 1916. A classification of the 1925 issues by countries is shown in the following
table.
FOREIGN LOANS ISSUED IN THE UNITED STATES
GOVERNMENT AND
MUNICIPAL AND
GUARANTEED BT
THE GOVERNMENT

COUNTRY

1925

CORPORATE

TOTAL

EUROPE

Austria
Belgium
Czecho-Slovakia
Denmark
Germany
Italy
Norway
Poland
Other

$10,500,000
50,000,000
21,500,000
38,500,000
162,700,000
100,000,000
40,100,000
35,000,000
46,000,000
$504,400,000

4,000,000
4,000,000
70,500,000
19,600,000
5,800,000
15,800,000
19,100,000
$146,200,000

$17,900,000
50,000,000
25,500,000
42,500,000
233,200,000
119,600,000
45,900,000
50,800,000
65,100,000
$650,600,000

$184,500,000

$82,000,000

$266,500,000

Total

$121,400,000
20,000,000
33,100,000
$174,500,000

$16,500,000
50,000,000
$66,500,000

$121,400,000
36,500,000
83,100,000
$241,000,000

Total

75,000,000
6,400,000
$81,400,000

Total
CANADA AND NEWFOUNDLAND

$7,400,000

LATIN AMERICA

Argentina
Chile...
Other
ASIA AND AUSTRALIA

Japan
Australia
Other

$20,700,000

INTERNATIONAL

Grand Total

$944,800,000

200,000
$66,700,000

$66,500,000
75,000,000
6,600,000
$148,100,000
$20,700,000

$382,100,000

$1,326,900,000

$66,500,000

In addition to purchasing long term securities the United States
has provided a certain amount of short term credit through the medium of bankers acceptances and other temporary credits, and by
maintaining balances abroad. The amount of such extensions of
credit cannot be estimated with any degree of accuracy.

Gold Credit to the Bank of England
In April 1925, this bank, in association with all other Federal
Reserve Banks, entered into an agreement to place $200,000,000 of
gold at the disposal of the Bank of England for a period of two
years, in connection with England's return to gold payments.



40

ELEVENTH ANNUAL REPORT

The exact provisions of the arrangement were described as follows
in the Federal Reserve Bulletin for June 1925:
"Under its arrangement with the Bank of England the Federal
Reserve Bank of New York undertakes to sell gold on credit to the
Bank of England from time to time during the next two years, but
not to exceed $200,000,000 outstanding at any one time. The credit
is to bear interest to the extent that it is actually used at a rate
1 per cent, above the New York Reserve Bank's discount rate, with
a minimum of 4 per cent, and a maximum of 6 per cent., or, if the
Federal Reserve discount rate exceeds 6 per cent., then at the rediscount rate of the bank. . . . Upon the purchase of gold the Bank of
England will place on its books to the credit of the Federal Reserve
Bank of New York an equivalent deposit in pounds sterling. This
deposit may be used from time to time by arrangement with the
Bank of England in the purchase of eligible sterling commercial
bills which shall be guaranteed by the Bank of England, and in that
case discount earned on the bills will be applied to the payment of
interest.
"If occasion arises for the use of this credit, support can be given
to sterling exchange either through the purchase of sterling bills
in New York or abroad, or gold can be shipped to other countries on
British account. Thus the Bank of England could meet a foreign
demand for gold without reducing its own reserves, or it could replenish its reserves by withdrawing gold from this country or by
earmarking it in New York. The form in which the credit would
be used would depend upon the circumstances at the time."
The repayment, within a period of two years, of such portion of
the credit as may be used by the Bank of England is guaranteed by
the British Treasury under the terms of the Gold Standard Act
passed by Parliament early in May 1925. This guarantee protects
the Federal Reserve Banks against any governmental act which
might operate to restrain the Bank of England from meeting its obligation, by the shipment of gold or otherwise. The
transaction, however, is not with the British Government, but is
solely with the Bank of England. In this respect it differs from the
contemporaneous 100 million dollar credit which Messrs. J. P.
Morgan & Company arranged for the British Government with
commercial banks in the United States, which is solely a Government credit.
The arrangements between the Bank of England and the
Federal Reserve Bank of New York involve no commitment as to
the policies to be pursued by this bank in dealing with domestic
credit conditions. While it is the intention of this bank to exchange
information fully with the Bank of England and to avoid any un


FEDERAL RESERVE BANK OF NEW YORK

11

necessary action which would be detrimental to the maintenance of a
free gold market, the Federal Reserve Bank of New York and the
Bank of England are both absolutely free and uncommitted as to
any action whatever relative to discount rates.
Thus far no use of the credit has been made by the Bank of
England.
PER CENT.
DEPRECIATION

Aer^n

PAR

/

450

J

V

-15

/
350

-178

-28.1

v

1

300

-384

1919

1920

1921

1922

1923

1924

1925

S. Fluctuations in Sterling Exchange

Arrangements with Poland and Belgium
Arrangements have been made during the past year in which
all other Federal Reserve Banks have participated, to make loans
secured by gold to the Bank of Poland and to buy prime commercial Belgian bills from the National Bank of Belgium, if desired.
These arrangements were for the purpose of facilitating efforts
which were being made to stabilize the currency or improve the
monetary position of the countries involved.




1*

ELEVENTH ANNUAL REPORT

Reports of Operation
As complete statistics of the operations of each Reserve Bank are
published in the annual report of the Federal Reserve Board, detailed figures of the operations of this bank are omitted from this
report, with the exception of the following pages showing the statement of condition at the beginning and end of the year, the income
and disbursements during the year, and a table on the volume of
operations in principal departments.
RESOURCES

CASH RESERVES held by this bank against its
deposits and note circulation:
Gold held by the Federal Reserve Agent as
part of the collateral deposited by the
bank when it obtains Federal Reserve
notes. This gold is lodged partly in the
vaults of the bank and partly with the
Treasurer of the United States
Gold redemption fund in the hands of the
Treasurer of the United States to be used to
redeem such Federal Reserve notes as are
presented to the Treasury for redemption
Gold and gold certificates in vault
Gold in the gold settlement fund lodged
with the Treasurer of the United States
for the purpose of settling current transactions between Federal Reserve districts
Legal tender notes, silver, and silver certificates in the vaults of the bank (available
as reserve only against deposits)
Total cash reserves
NON-RESERVE CASH,

Dec. 31, 1924

Dec. 31,1925

$384,306,965.61

$329,996,016.59

11,557,070.44
277,262,589.82

13,516,129.74
331,225,694.40

286,475,438.52

254,226,803.87

21,867,394.00

27,256,282.00

$981,469,458.39

$956,220,926.60

$18,517,186.90

$16,966,978.42

$68,744,642.50

$197,709,000.00

12,577,441.02
101,823,154.40

35,234,620.12
42,019,937.59

169,898,350.00
1,746,000.00

57,199,050.00
2,106,000.00

$354,789,587.92

$334,268,607.71

$16,242,897.76

$16,617,060.69

156,377,299.73
8,656,803.63

170,992,612.34
4,162,451.27

$181,277,001.12

$191,772,124.30

$1,536,053,234.33

$1,499,228,637.03

consisting largely of

National Bank notes and minor coin
LOANS AND INVESTMENTS:

Loans to member banks:
On the security of obligations of the
United States
By the discount of commercial or agricultural paper or acceptances
Acceptances bought in the open market...
United States Government bonds, notes,
and certificates of indebtedness
Foreign loans on gold
Total loans and investments
MISCELLANEOUS RESOURCES :

Bank premises
Checks and other items in process of collection
All other miscellaneous resources
Total miscellaneous resources
Total resources



FEDERAL RESERVE BANK OF NEW YORK
LIABILITIES

Dec. 31,1924

Dec. 31,1925

CtTORENCY IN ClBCULATION:

Federal Reserve notes in actual circulation,
payable on demand. These notes are
secured in full by gold and discounted
and purchased paper
Total currency in circulation

$387,352,885.00

$393,036,812.50

$387,352,885.00

$393,036,812.50

$883,861,349.67

$847,248,505.07

16,904,418.11

3,183,106.57

28,194,141.08

11,282,630.44

$928,959,908.86

$861,714,242.08

$129,054,958.09
1,769,392.67

$150,262,580.52
1,856,109.53

$130,824,350.76

$152,118,690.05

$30,166,800.00

$32,394,500.00

58,749,289.71

59,964,392.40

DEPOSITS:

Reserve deposits maintained by member
banks as legal reserves against the deposits of their customers
United States Government deposits carried
at the Reserve Bank for current requirements of the Treasury
Other deposits including foreign deposits,
deposits of non-member banks, etc
Total deposits
MISCELLANEOUS LIABILITIES:

Deferred items, composed mostly of uncollected checks on banks in all parts of the
country. Such items are credited as deposits after the average time needed to
collect them elapses, ranging from 1 to 8
days
All other miscellaneous liabilities
Total miscellaneous liabilities
CAPITAL AND SURPLUS:

Capital paid in, equal to 3 per cent, of the
capital and surplus of member banks
Surplus—that portion of accumulated net
earnings which the bank is legally permitted to retain
Total capital and surplus
Total liabilities

$88,916,089.71

$92,358,892.40

$1,536,053,234.33

$1,499,228,637.03

The principal changes between December 31,1924 and December
31, 1925 were as follows:
A decrease of 25 millions in cash reserves
An increase of 152 millions in loans to member banks
A decrease of 60 millions in holdings of acceptances bought in
the open market
A decrease of 113 millions in holdings of Government securities
A decrease of 37 millions in the reserve deposits maintained by
member banks
Practically no change in the volume of notes in circulation



14

ELEVENTH ANNUAL REPORT

The decrease in gold holdings reflects gold exports and the payment of gold certificates into circulation, partly offset by a considerable transfer of gold from other districts to New York.
The changes in loans to member banks and in holdings of bills
and securities reflect in part the sale by the Federal Reserve Banks
of about 200 millions of Government securities between January
1 and March 31. The participation of the Federal Reserve Bank
of New York in this sale is represented by the decrease in its holdings
of U. S. Government securities. The sale of securities had the result
of increasing the direct borrowing by member banks at the Reserve
Bank, a tendency which was further advanced by active business
conditions and gold exports.
The decrease shown by the statement in the amount of holdings
of acceptances bought in the open market is not significant of any
marked change in the acceptance market, since acceptance holdings
by all the Reserve Banks were only slightly less than a year ago.
It rather represents a more widespread distribution of acceptance
holdings among the Reserve Banks.
The decrease in reserve deposits reflects a decrease in the deposits
of member banks, as commented upon earlier in this report.
DISCOUNT RATE

Accompanying an increase in loans to member banks and an
increase in open market money rates, the discount rate of the bank
for all discounts and advances was increased from 3 to 3 ^ per cent,
on February 27. The 3}^ per cent, rate was maintained throughout
the balance of the year.
INCOME AND DISBURSEMENTS

The following table shows the income and disbursements for the
years 1924 and 1925. Total earnings in 1925 were over a million
dollars larger than in the preceding year, due largely to increased
borrowing by member banks. Expenses of current bank operations
were slightly smaller than in 1924, notwithstanding the fact that
1925 was the first full year in the new building and that there was
also a continued increase in the volume of operations of the bank.
Earnings for the year were sufficient to pay the 6 per cent, dividend
on capital stock provided by the Federal Reserve Act, and to add
$1,200,000 to surplus.



FEDERAL RESERVE BANK OF NEW YORK
1924

EARNINGS

From loans to member banks and paper
discounted for them
From acceptances owned
From United States Government obligations owned
Other earnings

15

1925
$5,188,505.53
1,469,858.04

4,165,856.35
343,234.80

2,984,698.11
574,111.85

$8,569,350.36

Total earnings

$2,613,565.96
1,446,693.25

$10,217,173.53

$6,155,270.43

$6,044,925.67

195,550.43

280,276.07

1,601,677.18

788,673.37

$7,952,498.04

$7,113,875.11

$616,852.32

$3,103,298.42

$1,796,529.82

$1,888,195.73

DEDUCTIONS PROM EARNINGS

For current bank operation. These figures
include most of the expenses incurred as
fiscal agent of the United States
For Federal Reserve currency, mainly the
cost of printing new notes to replace
worn notes in circulation, and to maintain supplies unissued and on hand
For depreciation, self-insurance, and other
reserves, etc
Total deductions from earnings
Net income available for dividends, additions to surplus, and payment to the
United States Government
DISTRIBUTION OF NET INCOME

In dividends paid to member banks, at the
rate of 6 per cent, on paid-in capital....
In additions to surplus—The bank is permitted by law to accumulate out of net
earnings, after payment of dividends, a
surplus amounting to 100 per cent, of the
subscribed capital; and after such surplus has been accumulated to pay into
surplus each year 10 percent, of the net
income remaining after paying dividends.
Any net income remaining after paying dividends and making additions to surplus
(as above) is paid to the United States
Government as a franchise tax. No balance remained for such payments in
1924 and 1925
Deficit of net income after dividend payments, which has been charged to surplus account
Total net income distributed

1,215,102.69

1,179,677.50
$616,852.32

$3,103,298.42

VOLUME OP OPERATIONS

The table on page 16 gives the average daily transactions during the year in the principal departments and indicates that the
bank's transactions have continued to increase in volume. Aside
from its credit operations, the transactions of the bank tend to show
a steady increase from year to year.



ELEVENTH ANNUAL REPORT

16

DAILY AVERAGES

NUMBER OF PIECES HANDLED

Bills discounted:
Applications
Notes discounted
Bills purchased for own account
Currency received and counted
Coin received and counted....
Telegraphic transfers of funds.
Checks handled
Collection items handled:
U. S. Government coupons
paid
All other
U. S. securities—issues, redemptions, and exchanges by
Fiscal Agency department...

1923

1924

1925

58
239
251
1,580,320
2,702,412
939
425,151

41
130
203
1,684,529
3,017,043
942
447,914

51
120
209
1,828,790
3,239,783
971
470,369

58,555
7,208

46,235
7,990

40,118
6,733

27,307

9,826

7,586

$59,443,190
3,899,494
9,954,580
415,583
92,819,536
216,947,121

$23,127,772
3,553,236
10,450,748
375,926
115,269,461
224,992,547

$56,329,370
3,848,107
11,682,250
884,915
128,123,044
290,473,130

1,117,032
6,359,997

1,093,319
6,163,628

1,028,536
6,881,294

10,426,723

11,587,125

13,231,618

AMOUNTS HANDLED

Bills discounted
Bills purchased for own account
Currency received and counted
Coin received and counted.. ..
Telegraphic transfers of funds.
Checks handled
Collection items handled:
U. S. Government coupons
paid
All other
U. S. securities—issues, redemptions, and exchanges by
Fiscal Agency department...

ELECTION OF DIRECTORS

In October and November an election was held for two directors
to succeed Gates W. McGarrah, of Class A, and Owen D. Young,
of Class B, whose terms expired at the end of 1925. Mr. McGarrah,
believing that a Class A director should serve but one term, asked
that his name should not be considered for reelection. Only the
banks in Group 1, that is, banks having a capital and surplus in
excess of $1,999,000, participated in the election.
On December 3 the election was announced of:
Jackson E. Reynolds, Class A director, President of the First
National Bank of the City of New York
Owen D. Young, Class B director, Chairman of the Board of
the General Electric Company



FEDERAL RESERVE BANK OF NEW YORK

17

Each is to serve for a term of three years from January 1, 1926.
Of the 67 banks in Group 1, 60 cast votes for Mr. Reynolds and
59 for Mr. Young. No other votes were cast. The Federal Reserve
Board has reappointed Pierre Jay as Class C director, for a term of
three years, beginning January 1, 1926, and has also redesignated
him for the year 1926 as Chairman of the Board and Federal Reserve
Agent. The Federal Reserve Board has also redesignated W. L.
Saunders as Deputy Chairman of the Board.
MEMBER OF ADVISORY COUNCIL

At a meeting of the board of directors held on January 8, 1925,
Paul M. Warburg of New York City, was reelected a member of the
Federal Advisory Council from the Second Federal Reserve District
for the year 1925.
OFFICERS AND STAFF

During the year 1925 the following members of the official staff
resigned to accept other positions:
January 31—William H. Dillistin, Manager, Bank Examinations
Department
April 30—Alan K. Lauckner, Manager, Methods and Supplies
Department
December 31—Gilbert E. Chapin, Controller of Loans
December 31—Joseph L. Morris, Manager, Credit and Discount
Department
George B. Roberts, Manager of the Reports Department, has
tendered his resignation, effective February 1, 1926.
Readjustments in departmental organization have made it
possible to carry forward the work of the bank without as yet replacing these officers, and the number of officers in the New York
office therefore shows a reduction from 32 to 27.
Howard M. Jefferson, Manager of the Personnel Department,
was granted leave of absence from the bank from July 1, 1925 to
March 1, 1926 to be a member of a mission to study the banking
and financial system of Chile, make recommendations, and supervise
the installation of a new monetary system.
The total staff of the bank was reduced from 2,653 on December
31, 1924, to 2,447 on December 31, 1925, and the annual salary



18

ELEVENTH ANNUAL REPORT

liability from $4,380,711 to $4,045,919. These figures include the
staff of the Buffalo Branch and the officers. This reduction of more
than 200 workers is largely a consequence of the greater ease and
safety of operations in the new building.
BUILDING AND ANNEX

The bank moved into its new building during the summer and
fall of 1924. Therefore 1925 has been the first full year of operations in the new building, which has proved itself well adapted to the
business of the bank. The additional cost of maintaining and operating the building has been more than absorbed by the economies in
operation which it has made possible. In addition the major part
of one floor of the building has been leased to tenants, thus providing an income pending the time when the bank may need this
space for its own use.
In 1921 the bank erected an annex building primarily for the
storage of records and other bank property. The building was used
during the construction of the main bank building for the housing
of many of the departments of the bank. Following the transfer of
all departments of the bank into the new building, practically all of
the space in the annex building has been leased to tenants. The
bank has reserved certain space in the basement for storage purposes
and has arranged its leases in such a way that the building will be
available for storage or other purposes when it may be needed by
the bank.
CONFERENCES WITH BANKERS

In the spring of 1925 a series of conferences with the officers of
member and nonmember banks in the Second District outside of
New York City was held, for the purpose of discussing with them
their relations with the Federal Reserve Bank and some of their own
problems, and of giving them an opportunity to see the bank in
operation in its new building. In all, 26 conferences were held, from
March 31 to June 12. The average attendance at each conference
was 28, and the number of banks represented at the conferences was
703, out of a total of about 1,100 banks in the district outside of New
York City. Representatives of 71 per cent, of the member banks and
40 per cent, of the nonmember banks attended the conferences,
which lasted the major part of the day.



FEDERAL RESERVE BANK OF NEW YORK

19

In addition, conferences to serve a similar purpose were arranged
for the senior officers of nearby banks in New York City. These
were attended by 270 officers, representing 42 member and 9 nonmember banks.
These gatherings not only gave visiting bankers an opportunity
to become better acquainted with the work of the Federal Reserve
Bank, but afforded the officers of the Reserve Bank a means for
renewing their personal acquaintance with many of the bankers
in the district and for becoming more familiar with their problems.




20

ELEVENTH ANNUAL REPORT
DIRECTORS AND OFFICERS
Term
Expires
Dec. SI

DIRECTORS
Class Group
A

1 JACKSON E. REYNOLDS, New York City

1928

President, First National Bank
A

2

ROBERT H. TREMAN, Ithaca, N. Y

1926

President, The Tompkins County National Bank
A

3

DELMER RUNKLE, Hoosick Falls, N. Y

1927

President, Peoples National Bank
B

1 OWEN D. YOUNG, New York City

1928

Chairman, General Electric Company
B

2

THEODORE F. WHITMARSH, New York City

1926

President, Francis H. Leggett & Company
B

C
C
C

3

SAMUEL W. REYBURN, New York City

1927

President, Associated Dry Goods Corporation
and Lord & Taylor
PIERRE JAY, New York City, Chairman
W. L. SAUNDERS, Plainfield, N. J., Deputy Chairman
Chairman, Ingersoll-Rand Company

.

.

.

1928
. 1926

CLARENCE M. WOOLLEY, New York City

1927

Chairman, American Radiator Company

MEMBER OF FEDERAL ADVISORY COUNCIL
JAMES S. ALEXANDER, New York City

OFFICERS
General Officers
BENJ. STRONG, Governor

J. HERBERT CASE, Deputy Governor

GEORGE L. HARRISON, Deputy Governor

Louis F. SAILER, Deputy Governor

EDWIN R. KENZEL, Deputy Governor

JESSE HOLLADAY PHILBIN, Secretary

JAY E. CRANE, Assistant Secretary

L. RANDOLPH MASON, General Counsel
JESSE HOLLADAY PHILBIN, Assistant General Counsel

Senior Officers
RAY M. GIDNEY,

Controller of Loans
ARTHUR W. GILBART,

Controller of Cash and
Controller of Collections



LAURENCE H. HENDRICKS,

Controller of Fiscal Agency Function
J. WILSON JONES,

Controller of Administration
LESLIE R. ROUNDS,

Controller of Accounts

FEDERAL RESERVE BANK OF N E WYORK

21

DIRECTORS AND OFFICERS—(Continued)
Junior Officers
DUDLEY H. BARROWS,

WALTER B. MATTESON,

Manager, Administration Department
CHARLES H. COE,

Manager, Securities Department
ROBERT M. O'HARA,

Manager, Check Department

Manager, Bill Department

JAY E. CRANE,

JAMES M. RICE,

Manager, Foreign Department

Manager, Accounting Department

EDWIN C. FRENCH,

STEPHEN S. VANSANT,

Manager, Cash Department

Manager, Safekeeping Department

HOWARD M. JEFFERSON,

I. WARD WATERS,

Manager, Personnel Department

Manager, Collection Department

ADOLPH J. LINS,

Manager, Credit and Discount Department

EDWARD L. DODGE, General Auditor

FEDERAL RESERVE AGENT
PIERRE JAY, Federal Reserve Agent
W. RANDOLPH BURGESS,

CARL SNYDER

Assistant Federal Reserve Agent

General Statistician

BUFFALO BRANCH
Term
Expires
Dec. SI

DIRECTORS
FRANK W. CRANDALL

.

.

.

.

1928

President, National Bank of Westfield, Westfield, N. Y.
ARTHUR HOUGH, Batavia, N. Y

1927

President, Wiard Plow Company
JOHN A. KLOEPFER, Buffalo

1928

President, Liberty Bank of Buffalo
ELLIOTT C. MCDOUGAL, Buffalo

1927

President, Marine Trust Company
JAMES H. MCNULTY, Chairman

1926

President, Pratt and Lambert, Inc., Buffalo
HARRY T. RAMSDELL, Buffalo

1926

Chairman, Manufacturers and Traders Trust Company
WALTER W. SCHNECKENBURGER, Managing Director

1926

OFFICERS
WALTER W. SCHNECKENBURGER,

CLIFFORD L. BLAKESLEE,

Managing Director

Assistant Cashier

HALSEY W. SNOW, JR.,

ELMER L. THEOBALD,

Cashier



Assistant Cashier

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