Full text of Annual Report of the Federal Reserve Bank of New York : Fourth Annual Report of the Federal Reserve Bank of New York for the Year Ended December 31, 1918

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FOURTH ANNUAL REPORT
OF THE

FEDERAL RESERVE BANK
OF NEW YORK
FOR THE TEAR ENDED DECEMBER 31, 1918

WASHINGTON
GOyttNMBNT PUNTING OFFICB
1919

LETTER OF T R A N SM IT T A L .

F ederal R eserve B a n k ,

New York, January 15, 1919.
Sra: I have the honor to submit herewith the fourth annual report
of the Federal Reserve Bank of New York, covering the year 1918.
Respectfully,
P i e r r e Jay,

Chairman and Federal Reserve Agent

Hon, W. P. G. H arding,
Governor, Federal Reserve Board,
Washington, D. C.

TABLE OF C O N T E N T S.
Page.

Officers and directors of the bank.............................................. .....................
5
Results of operation..........................................................................................
Balance sheet.............................................................................................
7
Income and expense..................................................................................
7-8
Discount rates............................................................................................
8-9
Investments during 1918................................................................................. 9-18
Discounts, advances, and purchases, and reserves..................................... 9-13
Bankers’ acceptances and the discount market......................................... 14-17
Trade acceptances..................................................................................... 17-18
United States bond operations...................................................................
18
Municipal warrants....................................................................................
18
Maturities of discounts and advances.........................................................
18
Note issues and the accumulation of gold......................................................... 19-20
Collections and clearings.................................................................................. 20-24
The collection system......................................................................... .
20-22
Gold settlement fund................................................................................. 22-23
Telegraphic transfer system....................................................................... 23-24
Relations with banks in district....................................................................... 24-27
Relations with member banks.................................. ................................24-25
Fiduciary powers for national banks..........................................................
25
Changes in reserve requirements...............................................................
26
Reserve penalties......................................................................................
26
Relations with nonmember banks............................................................. 26-27
Relations with New York Clearing House Association.................................. 27-28
Relations with foreign banks and progress of foreign banking..........................28-31
Bank of England........................................................................................
29
Bank of France..........................................................................................
29
Bank of Italy.............................................................................................
29
Bank of Japan.......................................................... - ..............................
29
Philippine National Bank..........................................................................
29
De Nederlandsche Bank............................................................................
29
Sveriges Riksbank and Norges Bank.........................................................
30
Argentina...................................................................................................
30
Bolivia.......................................................................................................
30
Peru...........................................................................................................
30
Indian Government................................................................................... 30-31
Registration of dealers in foreign exchange................................- .....................
32
Organization of the b an k .................................................... *.......................... 32-37
Int?mal management................................................................................. 32-35
Bank premisas......................... . - ..............................................................
3
(5
Election of directors............................................................................... . - 36-37
Member of Advisory Council......................................................................
37
Fiscal agency operations...................................................................................37-59
Certificates of indebtedness........................................................................ 38-39
The Liberty loans...................................................................................... 40-41

7
-9

TABLE OF CONTENTS.

Fiscal agency operations—Continued.
Fixed organization established...................*...........................................
The Central liberty Loan Committee......................................................
43
The sales organization.............................................................................
^
Organization outside Metropolitan district.......................... ..................... 43-44
Organization in Metropolitan district....................................................... 44-46
Woman’s committee................................................................................
^
Partial payments....................................................................................
Publicity......... ...................................................................................... J*
Publicity organization and results............................................................ 49-51
Receipts, deliveries, exchanges, and conversions...................................... 51-52
Government deposits............................................................................... 52-53
Government disbursements......................................................................
54
Expenses of loans....................................................................................
New Government loan organization.........................................................
^5
War savings and thrift stamps..................................................................
^5
Stabilization of the money market............................................................ 55-57
Capital Issues Committee......................................................................... 57-59
Financial conditions...................................................................................... 59-70
Banking in the Second Federal Reserve District.........*............................59-61
General business conditions............................................................................ 61-63
Labor...................................................................................................... 63-64
Industries and staples.............................................................................. 64-65
Local crops..............................................................................................
®
5
Merchandizing........................................................................................
Money rates............................................................................................ 65-66
The securities market.............................................................................. 67-68
Foreign trade..........................................................................................
69
EXHIBITS.

A. Movement of earning assets during calendar year....................................... 70-71
B. Movement of cash reserves, net deposits, etc.............................................. 72-73
SCHEDULES.

1.
2.
3.
4.
5.
6.
7.
8.
9.
10.
11.
12.
13.
14.
15.
16.
17.
18.
19.
20.

Balance sheet...........................................................................................
74
Income and expense statement.................................................................
75
Discount rates..........................................................................................
75
State banks admitted to system during 1918..............................................
76
Foreign branches of American banks......................................................... 76-77
American branches of foreign banks..........................................................
78
Employees of the bank.............................................................................
79
Certificates of indebtedness.......................................................................
80
Liberty loan subscriptions........................................................................
80
Ratio of subscriptions received........ ........................................................
81
Subscriptions, third and fourth loans, by geographic divisions...................81-82
Expenses of third and fourth loans............................................................82-83
Capital account reconciliation...................................................................
83
Summary of Federal Reserve notes...........................................................
83
Total of Federal Reserve notes paid out by federal Reserve Bank............
84
Movement of Federal Reserve notes............... ; .........................................
84
Summary of gold settlement fund operations.............................................
84
Fiduciary powers granted national banks..................................................
85
Honor roll of employees in military service................................ *............86-87
When proceeds of items will become available..........................................

8-8
78

FEDERAL RESERVE B A N K OF N E W Y O R K .

Officers.
B e n ja m in S t r o n g ,
R obert

T r e m a n , .Deputy

Wm. W oodw ard,

Governor.
Deputy Governor (in

active).

Governor.

J. L in s , Assistant Cashier.
B. M a t t e s o n , Assistant Cashier.
L e s l i e R . R o u n d s , Assistant Cashier.
I . W a r d W a t e r s , Assistant Cashier.
J o h n E. R a a s c h , Assistant Cashier.
C. H. Coe, Assistant Cashier.
J. E. C r a n e , Assistant Cashier.
W . A. H a m i lt o n , Assistant Cashier.
D u d l e y H . B a r r o w s , Secretary.
H o w a r d M , J e f f e r s o n , Auditor.
J. E m is o n , Assistant Auditor.
G. M. Hayward, Assistant Auditor.
W. G. Sim pson , Assistant Auditor.
A d o lp h

W a lte r

Deputy Governor.
F. C u r t is , Deputy Governor and
Counsel.
Louis F. S a i l e r , Deputy Governor.
L a u r e n c e H . H e n d r i c k s , Cashier.
E d w in R. K e n z e l , Manager of Invest
ments.
J o s e p h D. H i g g i n s , Assistant Cashier.
A r t h u r W. G i l b a r t , Assistant Cashier.
G i l b e r t E . C h ap in , Assistant Cashier.
J. W i l s o n J o n e s , Assistant Cashier.
P i e r r e J a y , Federal Reserve Agent.
R. M. G id n e y , Assistant Federal Reserve Agent.
J. H e r b e r t C a s e ,
J am e s

Class A :

Directors.
Term expires.

New York City.................................... December 31, 1919
R o b e r t H. T r e m a n , Ithaca, N. Y ................ ....................... December 31, 1920
C h a r l e s S m ith , Oneonta, N. Y ............................................. December 31* 1921
Class B:
H e n r y R. T o w n e , New York City........................................ December 31, 1919
W i l l i a m B. T h o m p so n , Yonkers, N. Y .................................. December 31, 1920
L e s l i e R. P a l m e r , Croton on Hudson, N. Y ......................... December 31, 1921
Class C:
P i e r r e J a y , Chairman, New York City................................. December 31, 1919
W . L . S a u n d e r s , New York City...........................................December 31, 1920
G e o r g e F o s t e r P e a b o d y , Deputy Chairman, Saratoga
Springs, N. Y ....................................................... .............. December 31, 1921
W illia m W o o d w a r d ,

FOURTH ANNUAL REPORT OF THE FEDERAL
RESERVE BANK OF NEW YORK.
R

esu lts

p e r a t io n

BALANCE SHEET

Schedule 1 shows the condition of the Federal Reserve Bank of
New York on December 31, 1918, 1917, and 1916.
The increase in nearly every item in the balance sheet for 1918 is
an indication of the increased use by member banks of the facilities
of the Federal Reserve Bank in order to maintain their reserves
and to provide the loan expansion which the financing of the war
has necessitated. The various items will be commented on in
detail under the appropriate headings. A table and chart showing*
by weeks the volume of notes and deposits, together with the course
of the reserve percentage, are given on pages 72 and 73.
INCOME AND EXPEN SE .

The income and expenses of the bank during the years 1918 and
1917 are shown in Schedule 2.
The great expansion in the business of the bank during 1918 has
been reflected not only in increased income, but also in increased
expenses, although earnings naturally increased far more than
expenses. Most of the items of income are self-explanatory. The
amount of service charges received decreased because these charges,
imposed to cover the cost of collecting checks, were abandoned on
June 15.
The items of expense have been further subdivided during 1918,
many items heretofore included under general expense having
been placed under separate headings. Almost every item reflects
the expansion in staff, space and equipment which the immense
volume of business transacted during the year has necessitated.
At the close of the year, with the approval of the Federal Reserve
Board, a further amount of $299,375 was set aside in the deprecia
tion reserve account to provide against certain penalties for cancel
ing leases in the Equitable Building should the bank erect its own
building, and to provide against possible unascertained losses.
Also, under the same approval, $803,800 was charged off, represent
ing the estimated value of buildings now standing on the site pur-

ANNUAL. REPORT OF FEDERAL RESERVE B AN K OF N E W YORK,

chased during the year. Dividends at the rate of 6 per cent for the
year were paid; $7,672,676.44 was carried to surplus, bringing the
surplus up to the 40 per cent of paid-in capital which the present
law permits; and $12,795,214.57, being the balance of the net earn
ings, was set aside as a franchise tax payment subject to the call
of the Treasury Department, pending the consideration by Congress
of a bill recommended by the Federal Reserve Board which would
permit larger amounts of the net earnings of Federal Reserve Banks
to be retained as surplus.
The expenses shown in the foregoing statement do not include
the expenses of the departments of the bank performing its fiscal
agency functions or the expenses of the Liberty loan and certifi
cate of indebtedness selling and publicity organizations, all of which
are reimbursed directly by the Treasury Department.
DISCOUNT RATES.

The discount rates established by the bank during the year and
the rates at which bankers’ acceptances have been purchased in the
open market are shown in Schedule 3.
Throughout the year the rate policy of the bank has been necessarily
influenced by the policy of the Treasury Department with respect to
the interest rates on the bonds and certificates of indebtedness which
it has sold. The only change occurred on April 6, when an under
standing was reached, with the approval of the Federal Reserve Board,
under which all of the Federal Reserve Banks established a rate of
4i per cent for discounting 90-day paper secured by United States
Government obligations. This rate, conforming to the coupon rate
of the third and fourth Liberty bonds, was continued for the balance
of the year. At the same time the rate of this bank on 90-day com
mercial paper was advanced to 4f per cent, at which level it was still
below the market rate for such paper, as it has been ever since the
United States entered the war. While the rates of the Federal
Reserve Bank normally should remain at or above the market rate,
wider prevailing abnormal conditions this was impracticable, since
it was felt that a further advance in the 90-day rate on commercial
paper might affect unfavorably the rates at which the Government
was financing and that, in view of the Government’s policy of financing
at low rates of interest, the Federal Reserve Bank should maintain
steady and correspondingly low discount rates and endeavor in indi
vidual cases to check any tendency toward taking advantage of the
low rates for the mere purpose of profit making.
Owing to the differential of one-half of 1 per cent between the rate
on commercial paper and the rate on Government-secured paper,
the bulk of the paper held by the bank has been of the latter class,
which was natural in any event, since it was primarily the Govern-

A N N U A L REPORT OF FEDERAL RESERVE B A N K OF N E W YORK.

ment borrowings which compelled the banks to discount so heavily
at the Federal Reserve Bank.
Since early in 1915 the bank has established maximum and minimum
rates within which it has purchased bankers7 acceptances. This
policy was adopted at the inauguration of open-market transactions,
as it did not seem wise at that time to establish a fixed discount rate
on these bills. During the past year, however, the development of
the market has reached a point at which a stabilizing influence was
necessary and fixed rediscount rates as shown in the table for bankers'
acceptances were accordingly established on October 1, under authority
of section 13 of the Federal Reserve Act. While the banks have not
yet needed to exercise their rediscounting privilege under this rate, as
the market rate has been steadily lower, its establishment has
undoubtedly exercised a beneficial influence on the stability of openmarket operations.
During the year member banks, especially those in New York City,
have continued to use the 15-day rate very extensively. In fact, the
great bulk of their accommodations has been for periods of 15 days or
less and many of the largest banks borrow for from one to three days
only. By providing for these “ day-to-day ’ ’ loans, the Federal Reserve
Bank has furnished its members a recourse as quick and flexible
as the call-money market, which, in view of the wide fluctuations in
their liabilities caused by Government financing, has been of great
service to them and enabled them not merely to secure promptly
such large accommodations as they have required from time to time,
but to pay them off with equal promptness and facility. The arrange
ments made permitted these short discounts and advances to be
effected on either commercial or Government-secured paper and at the
same rate.
In vestm ents

the

F ederal
D u r in g

DISCOUNTS,

ADVANCES, AND

eserve

Bank

N ew

ork

1918.

PURCHASES,

AND

THEIR

RELATION

RESERVES.

As the war progressed it became increasingly necessary for the
banks to have recourse to the Federal Reserve Bank. The following
figures show the maximum use of its credit facilities in each of the
Liberty loan financing periods to date:

(Maximum discounts,advances,
j
and investments.
Financing period.
| Amount,
j
Date.
j
1
1
........................i $278,649,000 j June 19,1917
........................!
522,363,000 ! Nov. 30,1917
........................|

968,293,000 ! Dec. 30,1918

ANNUAL REPORT 0 T FEDERAL RESERVE BA N K OF N E W YOR&.

Each of these high points was followed by a period of contraction
which, however, never reached the preceding base, so that the
expansion was progressive, though not continuous.
While this heavy borrowing from the Federal Reserve Bank was
caused fundamentally by Government financing, its direct relation
was to the condition of the reserves of member banks rather than to
the sales of Government securities. As the Government deposits
created by the sales of securities and not requiring reserves to be
maintained against them were transformed through Government
disbursement into private deposits upon which reserves had to be
maintained, the banks had to borrow to create these additional
reserves. Furthermore, interior banks throughout the year con
tinued to meet withdrawals of Government deposits by drafts on
their New York correspondents, thereby causing a constant flow of
funds from New York to the interior and requiring the New York
banks to replenish their reserves at the Federal Reserve Bank until
the funds thus withdrawn were returned again through Govern
ment transfers.
The following chart shows the gold holdings of the bank during the
year and the aggregate amount of its loans and discounts. Aside
from the gradual but steady increase of the gold held by the system,
the fluctuations in the amount of gold held by this bank represent
its gains or losses through the settlement of balances with other
Federal Reserve Banks. The closeness with which the borrowings of
member banks follow the fluctuations in the gold holdings of this
bank clearly substantiates the views expressed in the foregoing
paragraph*

A N N U A L REPORT OP FEDERAL RESERVE B A N K OP N E W YORK.

£ /U ?M t§ AS5£TS \ $012) X £3 £ *K £ S
reO SM L X£SCXV£ SANK O f A f£W YO/f/C

ANNUAL REPORT OF FEDERAL RESERVE B A N K OF N E W YORK.

The increase in the note and deposit credits granted by the Federal
Reserve Bank of New York during the year has at times reduced the
reserve of the bank very materially. At the close of 1917 the average
reserve against all liabilities was 61.7 per cent. At the close of 1918
this had fallen to 44.5 per cent. The corresponding figures for the
entire Federal Reserve system are 61.8 per cent and 50.6 per cent.
These figures are far more significant than those of any individual
Federal Reserve Bank, since through rediscounting or the sale of
bills or other securities, the reserves of the various Fedeial Reserve
Banks are so readily equalized. Twice during the year, in order to
strengthen its reserve position, this bank sold bills, aggregating in all
$97,274,364.32, to other Federal Reserve Banks. At other times
during the year it rediscounted paper totaling $67,680,848.93 for
other Federal Reserve Banks in order to strengthen their reserves.
These transactions indicate the effectiveness of the transfer of re
serves through the Federal Reserve system as a whole concurrently
with the operation of the system as twelve separate units, each
especially equipped to understand and care for the needs of its own
district.
The figures of the reserves of this bank and of the Federal Reserve
system when the United States entered the war and at the close of
1918 are as follows:
Apr. 6, 1917.

Dec. 27,1918.
Cash reserves of—
Per cent.
Federal Reserve Bank of New York............
All Federal Reserve Banks...............

42.5
50.6

Amount.

Per cent.

Amount.
$637,295,000
91Q (*V\

$426,814,000
962,662,000

92.9
QA 1
Or* 7

. .. . -

The following is a statement of member bank discounts and
advances during 1& and 1917:
18
1918
Number
of items.
January.......
February...

Total..

Number
of items.

Amount.

5,552
7,441
7,882
6,446
10,802
11,653
11,323
15,016
11,993
13,498
15,457
8,975

$299,141,079.59
267,801,380.25
321,342,092.09
1,460,681,317.41
2,181,143,351.44
2,290,684,904.35
1,935,041,787.56
2,306,086,869.85
2,893,616,075.93
3,713,305,674.14
2,948,291,085.09
3,918,402,840.07

148
171
237
267
523
2,034
1,346
1,254
1,625
2,544
3,213
9,122

$598,162.06
1,925,351.05
3,062,583.13
2,439,223 25
6,545,273.25
552,976,458.11
262,366,105.28
53,024,394.21
319,543,993.34
2,382,893,110.97
2,663,667,291.90
262,232,974.93

129,038 .

24,535,538,457.77

22,484

6,511,274,921.48

M arch ........
A p ril..........

May.............
Juno............
July.............
August.........
September..
October.......
November..
December...

Amount.

1917

A N N U A L REPORT OF FEDERAL RESERVE B A N K OF N E W YO R K.

The immense volume of discounts and advances shown arises
from the practice which many member banks pursue of borrowing
for a few days, often only one day, with renewals, as required, for
varying amounts.
On several occasions the bank has purchased from the Treasury
special certificates of indebtedness payable within a few days, aggre
gating in all $3,133,000,000, in order to supply the special needs
of the Treasury pending the transfer of funds from other Federal
Reserve 4Banks or the withdrawal of funds from depositary banks.
The largest amount thus held at any one time was $195,000,000.
In order to facilitate the purchase of certificates of indebtedness
by nonmember banks, the bank has been ready to purchase such cer
tificates, with an agreement on the part of the nonmember Bank to
repurchase within 15 days. The largest amount thus held at any
one time was $12,313,500 on November 19.
In order to assist in making a more stable carrying market for
bankers’ acceptances for houses which deal in such bills, the bank
has from time to time during the year purchased bills at slightly
above current rates from such houses with an agreement on their
part to repurchase within 15 days, the largest amount of such pur
chases at any one time having been $8,222,000, on October 9. This,
however, has been considered as a purely temporary policy during
the development period of the discount market.
The following figures give certain data concerning the discounts
and advances of 1918 and 1917:
1913
14,831
Number of applications received .. .. ...............*............................
Amount of applications received.................... ..................................... $24,552,063,650.44
Amount of applications accepted and discounted or advanced upon $24,.535,538,457.77
$135,000,000.00
Largest application
. .. ................................
$5.02
Smallest application
. .. . . . . . . . . . . . . ........................ . ........ .
129,038
"Number of pieces of paper discounted or advanced upon.. . . . . . . . . .
$135,000,000.00
Largest piece of paper discounted or advanced upon. . . . . . . . . . . . . . .
$5.02
Smallest piece of paper discounted or advanced upon.. . . . . . . . . . . . .
$190,141.96
Average site of notes discounted or advanced upon.. . . . . . . . . . . . . . .
522

1917
2,513
$6,528,455,050.30
$6,513,225,285.60
$167,000,000.00
$50.00
22,484
$147,000,000.00
$25.00
$289,682.67
322

ANNUAL REPORT OP FEDERAL RESERVE B A N K OF N E W YORK.
BANKERS’ ACCEPTANCES AND THE DISCOUNT MARKET.

The monthly purchases of bankers’ acceptances and indorsed
trade bills by this bank for itself and other Federal Reserve Banks
during 1918 have been as follows:
For account of Federal R e
serve B a n k of N e w Y o rk .

F o r account of other Fed
eral Reserve B a n ks.

Num ber
of items.

N u m b er
of items.

Month.

January...................................................... I
February....................................................
M arch....................... : .............................. j
i

M a y ................. ......................................... 1
!
A u gu st.......................................................
September...........................................
October.................. ............................
!
Novem ber................................ . .
!
December.......................................
T o ta l.........................................

A m ount.

$80,010, 607.18
91,970,834 83
75, 850, 840.39
57,952,753 91
61,379, 509.85
39,567,561.89
62, 862,728 69
91, 862,018 00
115,774, 488.26
105, 567,788.66
100, 177, 148.45
fi2 U2L) 141 •40
?
U *} *1 1 1*10 43
+
t

4,154
3,910
3,175
2,775
2,866
1,573
2,172
3,190
4,211
3,414
3,519
2 202

j
1
1
i
i
!

Q 4Q7 493 ^4 1
45

37,161

Am ou n t.

819
540
447
286
320
442
430
[
574 i
849
1 605
L 018
812

$13, 133,089.64
11, 618,304.90
8,294,522.94
3, 175,214.24
4,024,431.26
7,540,528.48
11, 714, 855.80
14,002, 126.66
18, 735, 191.24
42,5S6,604.09
21,587, 604.22
18, 454,071.11

8 142

174,864,544.58

CLASSIFICATION.
Import and export.................
Domestic...............................
Indorsed trade bills of foreign origin*
Bills drawn to furnish dollar exchange
Domestic trade acceptances...........
Repurchase agreement___.... .. .
T otal.......................
.

609, 705,533.69
246, 957, 105.74
16,224,317.49
5,452,702.24
3,543, 134.62
63,614, 629.76
I

113,870,892.74
59, 318,612.76
1,391, 552.93
246,400.00
7, 086.15

945,497,423.54

174,864,544.58

....

Increased and more general use of the bankers’ acceptance has been
a striking development of the past year, especially in financing domes
tic transactions and in the storage and movements of the grain and
cotton crops. The volume of foreign drawn bills appearing in this
market, while reflecting the increased trade with the Orient, has not
increased proportionately with the volume of domestic bills, due in
part to shipping difficulties and in part to the settlement of a greater
volume of both imports and exports by cash rather than by drawing
bills.
As compared with estimates of $400,000,000 to $500,000,000 of
ankers acceptanccs and foreign trade bills on American merchants
outstanding at the end of 1917, it is now believed that there are
etween $<0),000,000 to $800,000,000 of bankers’ acceptances alone
outstanding in the United States.
*
fi&urcs, taken from published reports of institutions
C
(]era^
dstr.ct, show the amounts of acceptance
liabilities of national banks, trust companies, and State banks on the
dates indicated:

A N N U A L REPORT OF FEDERAL RESERVE B A N K OF N E W Y O R K .

September, 1918.

National banks................................................................
Trust companies..............................................................
State banks.......................................................................
Total......................................................................

September,
1917.

September,
1916.

*141,934,391.42
124,038,547.88
9,841,533.62

$73,717,000
91,424,509
7,355,910

$44,300,877
68,588,658
2,787,995

275,814,472.92

172,497,419

115,677,430

These figures, however, do not indicate the full measure of increase
for the country. The number of well-known banks located in other
cities that are now accepting is greatly increased and much of their
paper comes to New York for discount.
With the increase in number of accepting banks and volume of
bills circulating, the number of bill buyers has likewise increased.
Out-of-town banks are buying more freely, and many of those which
are now acceptors have also become buyers. Dealers report in
creased activity and interest in almost all parts of the country. The
turnover of some houses has more than doubled that of last year.
One house reports sales of $720,000,000 for this year as against
$358,000,000 in 1917.
During the year there have been accessions to the number of houses
that specialize as dealers in bankers' acceptances. Also several cor
porations organized to operate as discount houses have been formed.
Some of them are in operation and others are still in process of organi
zation. Also several important foreign trade banks have come into
existence and are operating. Perhaps, however, more significant of
the trend of intelligent opinion as to the future of New York as an
international financial center is the number of foreign banks and
bankers lhat have already established or are about to establish
branches or relations here.
The outstanding development of the year 1918 toward the firmer
establishment of an open discount market in America was recognition
of the fundamental necessity for a stable volume of call and short
time money available to dealers and discount houses at rates related
to the open-market rates for bills as distinguished from rates for loans
against investment securities or so-called brokers’ loans. While
money of this character has occasionally been available, it was not
until a leading banking house publicly announced its policy of lending
freely on bills at preferred rates—a policy subsequently adopted by
several other institutions and houses—that money in sufficient
volume was available to enable dealers to carry portfolios of bills
without the risk of such interest losses as to render it impracticable
for them to operate other than as mere traders. As has already been
stated, the Federal Reserve Bank has from time to time purchased
bills from dealers, under their agreement to repurchase within short
periods, at a rate of 4 f per cent per annum. Their recourse to this

ANNUAL REPORT OF FEDERAL RESERVE B AN K OF N E W YORK.

aid has been moderate and not continuous. It is hoped that more
and more banks, recognizing the advantages to the country and to
themselves of a broad and active open market, and the important
relation of dealers in bills to the development of such a market, will
add their support by providing dealers normally with the necessary
funds at rates closely related to the current bill rates, as is customary
in foreign markets.
Bill rates in the open market have been the most stable and the
lowest of all money rates. As compared with short-time United
States certificates of indebtedness bearing interest at from 4 per cent
to 4£ per cent, the primary market discount rates on bills of the bestknown names has not exceeded 4J per cent for the 90-day maturity
and has ranged down to 3J per cent. The ruling rates were, during
January and February, 4 per cent; from February to July, 4£ per cent
to 4} per cent, the higher rate being reached during the period of
Federal income tax payments; after slight recessions rates advanced
gradually to from 4| per cent to 4£ per cent in October when fourth
Liberty loan financing was at the peak; later, rates declined, on easier
money conditions, to 4J per cent at the year’s end. Generally speak
ing, the rates referred to were those quoted for unindorsed bills which
are offered for resale to investors at slightly lower rates of yield.
The Federal Reserve Bank has maintained its policy, established
last year, of buying practically only indorsed bills and at rates related
to those established by competition and supply and demand in the
open market. In purchasing it has continued to emphasize its pref
erence for short bills by paying rates graduated down to published
minima, according to maturities. While its purchases have sup
ported and stabilized the market, its rates have been generally above
the market for maturities other than the shortest period. Consequently
the average maturity of bills held by the bank has been reduced and
a wider distribution of bills to an increased number of buyers has been
effected, with a correspondingly increased diversification of indorsers
on bills held by the bank.
The Federal Reserve Bank as a further stabilizing step, and in
addition to its open-market purchases, established special rediscount
rates for the rediscount of bankers' acceptances under section 13 of
the act. These rates, established October 1, remain unchanged and
are: Maturities up to 15 days, 4 per cent; maturities 16 to 60 days,
inclusive, 4} per cent; maturities 61 to 90 days, inclusive, 4£ per cent.
During the year other Federal Reserve Banks did not participate
as freely as heretofore in the open-market purchases of the New York
bank, owing to increased demands in their respective districts and
also to the greater activity of their own member banks in both accept
ing and buying bills, many of which found their way to their district
bankg. Nevertheless there have been many transactions between

A N N U A L REPORT OF FEDERAL RESERVE B A N K OF N E W YO R K,

Federal Reserve Banks, the Federal Reserve Bank of New York
having bought from and sold to other Federal Reserve Banks, as well
as having bought in the market for their account.
During the year the banking laws of the State of New York were
modified to permit savings banks to invest in bankers' acceptances.
While a few of them have purchased from time to time in the open
market, the volume of their purchases has not been in proportion to
their indicated desire to carry portfolios of bills, as funds which
otherwise would have been employed in this way have been largely
invested in United States Treasury certificates of indebtedness.
TRADE

ACC EPTANCES.

The increased number of domestic trade acceptances offered for
rediscount at the Federal Reserve Bank not only is evidence of the
progress of the movement, but indicates also that commercial banks
are discounting them for customers more freely and are purchasing
them in the open market. The amount rediscounted and purchased
by the Federal Reserve Bank during 1918 was $31,903,092.74.
Much progress has been made during the year in the development
of the trade acceptance plan of closing accounts in domestic mer
chandise transactions. Under the direction of the American Trade
Acceptance Council many informal meetings were held at which
plans for adapting the system to particular lines of trade were dis
cussed and developed. Much was also accomplished through
economic discussions at more formal gatherings.
Trade associations, chambers of commerce, and credit associations
have formally recommended the use of the trade acceptance and
emphasized the importance of the movement. Many trade and
business associations have formally recommended that their mem
bers adopt the system, and in some lines selling terms have been
modified to include settlement by trade acceptances in all trans
actions not settled by spot cash or short discounts. In others
modified terms, attractive to the buyer, have been offered as induce
ments to their use. It has been estimated that more than 4,000
representative concerns now use the system.
Domestic trade acceptances have appeared in the open discount
market more generally this year than before, and where the names
are well known they find ready sales at favorable rates. These bills
usually come m fair-sized pieces—say, from $5,000 up—and to avoid
too large pieces several bills of marketable size are often drawn to
cover in their aggregate larger transactions. A new development
this year has been the offering in the open market of trade accept
ances bearing banking indorsements. This class of bill resembles
more nearly the bankers* acceptance as to the credit involved and
commands a lower rate than those not so indorsed.
116015—19----- 2

ANNUAL REPOET OP FEDERAL RESERVE B A N K OF N E W YORK,

The character, form, and manner of execution of bills offered as
trade acceptances for rediscount at the Federal Reserve Bank indi
cate that merchants and bankers would do well to give more careful
consideration both to the inherent limitation of the instrument to
current bona fide transactions between buyer and seller and to
technical details, such as legal or official signatures of -drawers,
acceptors, and indorsers, and the avoidance of change or alteration
in date, domicile, or any other of the terms of the bill as drawn.
Any such irregularities render the paper practically unsalable in
the open market and ineligible for rediscount at Federal Reserve
Banks. It is perhaps not unnatural that with many presentations
from different points of view of the theories and practices involved
in the establishment of the trade acceptance system some misinfor
mation and misunderstanding has developed, but it is expected that
with continued study of its problems these will be overcome and
disappear.
The American Trade Acceptance Council is in process of reorgani
zation into The Acceptance Council, and in its new organization will
combine trade acceptances and bankers’ acceptances as the dual
subject of its activities.
UNITED STATES BOND OPERATIONS.

In 1917 the Federal Reserve Board did not require Federal Reserve
Banks to purchase United States 2 per cent bonds bearing the cir
culation privilege from member banks. This policy has been con
tinued during 1918. During the year the Treasury has paid off
$4,492,000 of 1-year 3 per cent notes previously received by the
bank in exchange for United States 2 per cent bonds. The Federal
Reserve Bank has purchased $34,955,000 United States 2 per cent
certificates of indebtedness of a special character which it has
hypothecated as security for Federal Reserve bank notes.
MUNICIPAL WARRANTS.

During 1918 only one purchase of a municipal warrant was made,
the amount being $50,000.
MATURITIES.

The following statement shows the maturities of discounts and
advances held by the bank on December 31, 1918:
Discounts or
Discounts or
advances based advances based
on commercial on United States
paper.
securities.
Within 15 days....................
18-30 d a y s ........................
.......
31-60 days...........................
61-90 days......................................”
Over90days........................
Total....................................

Bankers*
acceptances.

Totai.

$32,801,406.83
4,168,348.13
5,866,121.59
1,934,028.42
876.00

$498,635,511.87
106,051,692.49
34,093,216.75
13,787,253.61

132,258,211.94
13,011,993.37
27,073,860.31
5,232,567.32

*563,698,13a 64
123,232,033.99
67,033,198.65
20,953,849.35
876.00

44,773,780.97

652,567,674.72

77,576,632.94

774,918,088.63

A N N U A L REPORT OF FEDERAL RESERVE B A N K OF N E W YORK.

NOTE ISSUES AND THE ACCUMULATION OF GOLD.

Throughout the year Federal Reserve notes have been freely
issued, as required by member banks, and the interchangeability of
Federal Reserve bank deposits and notes has been maintained as
heretofore.
The net circulation of Federal Reserve notes of this bank rose
during the year from $397,000,000 to $729,000,000, an increase of
$332,000,000. While some part of the increase is due to the policy
of exchanging Federal Reserve notes for gold or* gold certificates,
which has been consistently pursued since the bank began business,
the chief cause of the expansion was the demand for more notes with
which to carry on the constantly increasing volume of trade at
rising price levels. Higher prices and higher wages, with the larger
pay rolls and larger amounts of till and pocket money which they
necessitate, inevitably cause a large demand for circulating media,
and during the war this phenomenon has been common to all the
belligerent countries, even in Great Britain, where, as in the United
States, settlements are made mainly by checks. A considerable
quantity of Federal Reserve notes has been shipped during the year
to Central American and West Indian countries for circulation
purposes, and since the signing of the armistice the War Department
has sent considerable amounts of Federal Reserve notes to France,
in order that our returning soldiers may be supplied with American
instead of French currency. The note expansion has been perfectly
natural and not in any way forced; the notes have been redeemable
at all times in gold; and the aggregate increase in the amount of
Federal Reserve notes outstanding does not represent a net addition
to our circulating media, since a large part of the increase represents
merely an exchange of Federal Reserve notes for gold.
The amendment of September 26, 1918, now permits the issue of
Federal Reserve notes in denominations of $500, $1,000, $5,000, and
$10,000. These notes, of which a supply of the $1,000 denomination
has already been received, will be of service in enabling the banks
to avoid the necessity of paying out gold certificates of large
denominations.
The redemption of Federal Reserve notes of this bank unfit for
circulation during 1918 amounted to $226,722,730.
Since August, in order to cooperate with the Treasury Department
in its desire to secure silver certificates and break up the silver which
they represent for export to India and other countries, the bank,
by authority of the Federal Reserve Board, has issued Federal
Reserve bank notes in denominations of $1, $2, $5, and $10.
These notes, which are similar to national-bank notes, are secured
by special 1-year 2 per cent certificates of indebtedness issued for the
purpose to the Federal Reserve banks by the Treasury and held by it

ANNUAL REPORT OF FEDERAL .RESERVE BANK OF. N E W YORK.

as security for the notes. The amount of Federal Eeserve bank notes
of this bank issued and outstanding on December 31 was $33,034,000,
of which $10,585,000 were fives, $1,434,800 tens, and the balance
ones and twos. The total amount of silver notes shipped by this
bank to the Treasury Department during the same period was
$21,528,000. Both member and nonmember banks have cordially
cooperated bv sending in silver certificates for exchange into Federal
Reserve bank notes at the expense of this bank.
In order to assist in accumulating gold, since America entered the
war this bank has asked its member banks to sort out gold certificates
from incoming cash and send them to the Federal Reserve Bank in
exchange for Federal Reserve notes. In this w this bank and its
~ay
member banks have been able to contribute their share to the in
creased gold holdings of the Federal Reserve System. Furthermore,
the United States Treasury has continued its policy of returning
Federal Reserve notes to banks forwarding gold certificates for
redemption.
No premium has arisen on gold in tliis district, and this bank has
at all times been ready to pay out gold to its member banks as
required by them for purposes consistent with the policy of the
Government.
Lnder the provisions of the President’s embargo proclamation of
December 7, 1917, the Federal Reserve Bank of New York during
1918 forwarded to the Federal Reserve Board 1,163 applications
for permission to export gold, silver, or currency aggregating
$295,000,000, of which it recommended that 349 applications aggre
gating $26,000,000 should be granted.
C o l l e c t io n s

C l e a r in g s .

and

THE COLLECTION SYSTEM.

The following table shows the various classes and amounts of checks
handled during 1918 by this bank and its check-collection department:
[000's omitted in columns headed "amount.” ]
Items on other Items on bants in
Federal Re
other Federal Re
serve Banks.
serve districts.
Num
ber. Amount. Number.
January___
February..

388
314
557
513
419
330
286

September.
October___
November.
December..

Total

Items on banks in dis
trict No. 2.

Amount.

216
191
240
165

$4,111
4,543
5,460
6,394
6,636
3,706
2,016
1,500
1,277
203
177
376

551,505
490,797
614,882
687,963
686,939
704,897
867,169
891,802
910,132
941.333
810,338
849,563

36,399

9,007,320

4,869,273

Marrh.......
April........
May..........
June.........
July..........
August___

Amount.

1,037,390
910,890
1,144,571
1,266,645
1,336,806
1,520,043
1,907,089
2,059,871
1,985,111
3,086,818
3,335,218
3,560,669

1360,051
288,902
384,365
411,076
421,714
414,156
438,666
443,513
484,428
426,656
394,011
401,835

3,859

Number.

$843,307
736,730
935,942
1,026,071
1,085,440
1,110,744
1,227,186
1,286,131
1,256,126
1,900,815
1,620,297
1,263,356

23,151,121

Items on New York
Clearing House.

Number.

Amount.

144,012
136,040
173,025
202,939
240,871
350.557
295,222
254,256
267,919
363,935
349.557
408,968

$1,614,331
1,484,633
1,617,768
1 927,746
1,894,694
1,849,555
1,903,747
1,952,715
2,092,561
2,593,787
2,214,451
2,238,028

14,292,145 . 3,187,301

23,384,016

ANNUAL. REPORT OF FEDERAL RESERVE BANK OF N E W YORK.

The growth of the check-collection department may best be illus
trated by the following figures;
Period.

1915 (Juno 1-Dec. 31).......
191G......................................
1917......................................
1918......................................

! Number of
|
items handled.

...........................i
1

19,408,179

Amount.

$1,334,015,772
5,160,192,000
20,104,527, C00
42,581,833,000

The development of the collection department showed greater
progress in 1918 than any preceding year. This was due to several
reasons: (a) The elimination on June 15 of the service charge of
1 cent per item for collecting checks and cash items; (b) the rule
adopted by the New York Clearing House, effective October 1, pro
viding that its members should neither pay a higher charge for the
collection of checks on banks on the Federal Reserve par list than
would be incurred in collecting such items through the Federal
Reserve Bank, nor allow the paying bank to hold back the remittance
beyond the day on which the item is received; (c) the abandonment
by the New York Clearing House on November 15 of its out-of-town
collection system; (d) the increase in the number of banks through
out the United States on which checks could be collected by the Fed
eral Reserve banks at par, from 17,144 in January, to 18,997 in
December.
The Federal Reserve Bank of New York has continued to accept
at par checks on every national bank, State bank, and trust com
pany in the district, although, as stated in the last report, a few of
the banks are not yet willing to remit at par and the Federal Reserve
Bank has been obliged to collect checks drawn upon them either
through express companies or by the establishment of local collecting
agencies. The number of these banks on January 1 was 76; on
December 31 it had been reduced to 42.
The result of the change in the constitution of the New York
Clearing House, above referred to, was to make it advantageous
to the members of the association to send to the Federal Reserve
Bank their out-of-town items on banks that were on its par list.
This caused the number of checks handled on banks outside of New
York City to increase from 2,895,243 in September to 4,028,151 in
October. The prevalence of the influenza epidemic during those
months made it impossible to augment the staff of the transit depart
ment, even with inexperienced clerks, sufficiently to handle this
imnense volume of items with promptness and efficiency, and for
a few weeks the work fell below the normal standard. Contem
poraneously with the great increase during October in the volume
of checks actually handled by the department, a large volume o

ANNUAL REPORT OF FEDERAL RESERVE BANK OF N E W YORK.

checks began to be sent by New York City banks direct to other
Federal Reserve Banks for their credit with this bank. While this
saved one handling, it complicated the accounting considerably,
especially with respect to “ returned items/' and for a time added
to the difficulties caused by the increased volume. To meet this
situation, a staff of about 60 clerks was engaged to begin work at
5 p. m. and to continue until midnight in addition to the normal
staff working from midnight to 8 a. m., and the main day staff.
These three shifts, together with further subdivision of the work
of the department, have solved the main difficulties encountered,
and the increased volume of checks, averaging in December 186,706
per day, is now being handled in a satisfactory manner. The staff
of the department increased from 152 in January to 445 in December.
The facilities of the Federal Reserve Bank are also being increas
ingly used for the collection of notes and drafts, both in and out of
New York City, the number of such items having increased from
6/201 in January to 13,695 in December. The machinery of the
New York Clearing House has1facilitated the collection of these
items in certain parts of the city, and plans are under consideration
which will enable the bank to collect more satisfactorily in other
parts of the city. The volume of noncash items, payable in New
York City, to be collected by presentation, has been greatly reduced
by the action of the New York Clearing House on August 1, which
permitted bankers' acceptances and notes to be cleared on the morn
ing of the maturity date.
The two rules of the New York Clearing House above referred to,
effective August 1 and October 1, respectively, had the effect of
reducing substantially the “ float” carried by the banks and trust
companies, as well as that which the Federal Reserve Bank had
been compelled to carry. The action of the New York Clearing
House on August 12, further reducing the charges which its mem
bers are required to impose for the collection of out-of-town checks
for their customers, is evidence that the commercial and industrial
interests of the country are receiving the benefit of the par collec
tion system. Charges on most items which were receivable formerly
at a charge of one-tenth of 1 per cent are now discretionary, and on
items formerly subject to a charge of one-fourth of 1 per cent the
present charges vary from one-fortieth to one-eighth of 1 per cent.
GOLD SE T T L E M E N T F U N D .

Transactions through the gold settlement fund have naturally
grown in volume as Government fiscal operations increased and
general business expanded. Banks in other Federal Reserve dis
tricts have continued to make their payments on account of deposits

A N N U A L REPORT OF FEDERAL RESERVE BANK OF N E W YORK.

arising from subscriptions to certificates of indebtedness and Liberty
loan, bonds to a very large extent by drawing upon their New York
correspondents, thus temporarily drawing funds away from New
York. On the other hand, the Treasury has transferred enormous
amounts to this bank, which, together with the natural return of
funds for redeposit, has substantially balanced the outward flow just
mentioned. Payments by this bank to other Federal Reserve Banks
through the gold settlement fund amounted to $16,438,319,755.03
during 1918, as compared with $8,692,024,000 during 1917, and pay
ments received from other reserve banks totaled $16,499,256,210.79,
as compared with 88,426,893,000 the previous year, a net gain by this
bank during the year of $60,936,455.76.
Instead of weekly settlements, which had previously sufficed, daily
?ettlements were inaugurated July 1, 1918, and these have practically
eliminated interim telegraphic settlements through the gold settle
ment fund except transfers made for Government account* A sum
mary of gold settlement fund operations is given in the appendix
(Schedule 17). *
The importance of this fund, not only for the immense transfers
which Government operations have necessitated, but for the daily
settlement at par of all interdistrict balances, can not be over
emphasized.
THE

T E L E G R A P H IC

TRANSFER

SYSTEM .

Telegraphic transfers of available funds have been made for mem
ber banks without limit as to amount, and no charge whatever has
been made for the service since the installation of private telegraph
wires connecting the Federal Reserve Board, the Treasuiy Depart
ment, and every head office and branch of a Federal Reserve Bank.
The volume of these transfers has been as follows:
Dally average.
Number
of
transfers.
January...
February.
March.......
April.........
May...........
June..........
July...........
.
September
October...
November.
December.

Augusts

65
80

8
8
11
0
12
1
10
1

135
142
168
188
187
209

Amount.

$49,137,729.59
50,063,542.32
42,693,293.87
54,739,515.64
55,045,75S.84
70,647,040.30
67,710,105.00
54,046,227.58
55,639,814.09
98,785,077.26
68,017,973. 77
86,148,696.73

ANNUAL REPORT OF FEDERAL RESERVE BANK OF N EW YORK.

The transfers handled include not only transactions between banks,
but also payments through member banks to individuals. With tele
graphic facilities thus made available without charge of private
wires, mail transfers have been greatly lessened. The telegraphic
transfer system has greatly reduced the buying and selling of domes
tic exchange, since funds actually available are transferable at par
by telegraph.
R

e l a t io n s

it h

B anks

the

is t r ic t .

RELATIONS WITH MEMBER BANKS.

In Federal Reserve District No. 2 the number of member banks
during the year has increased from 667 to 723, the location and char
acter of the members being as follows:
Location.

National
banks.

Connecticut...................
New Jersey................... .

448

152

622

14 j
16 !

62
493

30 |

New York, total...........
Tota*...................

Total.

1
0

128

New York (Manhattan)
New York (elsewhere)..

Trust
companies.

State
banks.

555

32 I

723

During the year 59 State banks and trust companies were admitted
to membership, a list of these members being shown in Schedule 4.
Four national institutions in the district were liquidated, all for
the purpose of combining with other institutions, which either were
or became members of the Federal Reserve Bank.
Relations with member banks have been necessarily close and con
stant. The selling of two issues of Liberty bonds, the num erous
sales of certificates of indebtedness, together with the payments by
book credit, the withdrawals of these credits, the custody of securities,
the correspondence, the accounting and the deliveries in con n ection
therewith, all have served to bring the Federal Reserve Bank into
intimate touch with every banking institution in the district, member
and nonmembcr alike. In all of these dealings for account o f tho
Treasury Department there has been no distinction whatever between
member banks and nonmember banks j all have been on exactly tho
same footing. While the Federal Reserve Bank could not discount
directly for nonmember banks, it has freely purchased from them
whenever necessary, at the same rate at which it was discounting
for its member banks, certificates of indebtedness with an agreem ent
on their part to repurchase within 15 days, and under authority of
the Federal Reserve Board has offered to rediscount their paper
when secured by Government obligations, with the indorsement of

AN NU AL REPORT OF FEDERAL RESERVE BANK OF N E W YORK.

a member bank. The response of the banks throughout the district
to the requests of the Treasury Department for the purchase of cer
tificates and for assistance in selling and financing Liberty loans has
been almost without exception of the most generous and enthusiastic
nature. The distribution of Liberty bonds effected during 1918 was
more general throughout the country than during 1917. The sale of
certificates in other districts was markedly better, as the Second
Federal Reserve District was called upon during 1918 to take only
38 per cent of the certificates issued, whereas in 1917 it absorbed
64 per cent of the total issued, and the burden on the banks of this
district, especially on those in New York City, has been lightened
proportionately. There has been no diminution in the patriotic
readiness of the banks in New York City during 1918 as during 1917
to do everything in their power to assist the financing of the war.
Member banks in New York City and certain other cities have also
cooperated with the Federal Reserve Board by sending to this bank
weekly reports of condition and of checks paid by them, to form part
of the statistics published by the board each week upon banking
conditions and transactions.
The banking facilities of the Federal Reserve Bank were used very
freely by member banks during 1918. More banks rediscounted,
used the collection system, transferred funds by wire, and relied on
this bank for supplies of currency than ever before. In order to
equalize the service given to all member banks and to give all banks
in the district facilities as nearly as possible equal to those enjoyed
by banks in the same city with the Federal Reserve Bank, this bank
on October 8, under authorization from the Federal Reserve Board,
paid the cost of shipping currency to and from member banks and
undertook to pay charges on all telegrams received from or sent to
member banks in connection with currency, exchange transfers, and
deposit transactions. There are still many member banks, how
ever, who have never used any of the facilities of this bank and do
not appear to understand the advantages of so doing.
F ID U C IA R Y

POW ERS

FOR

N A T IO N A L

BANKS.

Following the amendment to the Federal Reserve Act, cnacted
September 26, a considerable number of national banks in this distiict
filed applications for authority to exercise fiduciary powers. The
number of applications received to the end of the year was 54, of
which 34 were approved, 1 disapproved, and 19 were pending. The
list of banks which have been granted authority during 1918 to ex
ercise fiduciary powers will be found in the appendix (Schedule 18).

ANNUAL REPORT OF FEDERAL RESERVE BANK OF N E W YORK.
C H A N G E S IN R E S E R V E R E Q U IR E M E N T S .

Under the provisions of the amendment of September 26 to section
19 of the Federal Reserve Act, the Federal Reserve Board in October
reduced the reserves of member banks in the boroughs of Brooklyn
and Bronx to 10 per cent of demand and 3 per cent of time deposits;
and the reserves of member banks in the boroughs of Richmond and
Queens to 7 per cent of demand and 3 per cent of time deposits; but
an institution having branches in a more populous borough is obliged
to carry the reserves required for institutions in such borough.
R E S E R V E P E N A L T IE S .

Throughout the year, under regulations of the Federal Reserve
Board, member banks which have failed properly to maintain their
reserve deposits with this bank have been required to pay a penalty
upon the amount of the deficiency. The penalty rate, fixed by the
Federal Reserve Board at 2 per cent in excess of the 90-day discount
rate has been as follows: January, 6 per cent; February to April,
inclusive, 6J per cent; May to November, inclusive, 6| per cent.
The amount collected was $27,191.89, as compared with $18,585.29
during 1917, and the average number of banks penalized each month
has been 21, as compared with 12 during the preceding year. The
increase in the number of banks penalized is due to the increased
number of members, to mail and clerical difficulties, and to the
general preoccupation of the banks with Government work.
The Federal Reserve Bank has recently adopted the practice of
sending a representative to visit banks which do not appear to under
stand completely the requirement for the maintenance of reserves,
and it is expected that this will result in smaller deficiencies in the
future.
R E L A T IO N S W IT H N O N M E M B E R

BANKS.

As the war progressed and its financial burdens increased, with a
corresponding decline in the reserve percentage of the Federal Reserve
system, the officers of the Federal Reserve Bank felt it their duty to
call to the attention of the nonmember banks the importance of their
contributing their strength to the system which was compelled to
furnish the entire amount of additional credit required to carry on
the war. Accordingly, during the spring and summer a series of
conferences were held at the Federal Reserve Bank, attended in all
by officers of 134 out-of-town nonmember institutions, at which the
operations of the Federal Reserve Bank were explained and the needs
of the Government emphasized. These conferences permitted the
establishment of personal relations with the officers of the banks in
attendance, and resulted in a considerable number of applications
for membership.

AN N U AL REPORT OF FEDERAL RESERVE BANK OF N E W YORK.

The State institutions which became members of this bank during
1918 are given in Schedule 4.
At the close of the year, the Federal Reserve Bank of New York
had 101 State bank and trust company members, with total re
sources of $3,488,611,000; or 28.4 per cent in number and over 75 per
cent in resources of the eligible State banks and trust companies in
the district. Figures which have recently been published in the
Federal Reserve Bulletin indicate that with regard to the percentage
of both the number and the total resources of its eligible State
institutions now included within its membership, the New York
Reserve District leads all the other districts.
As already indicated, the fiscal agency functions of the Federal
Reserve Bank have brought it into relationship with all nonmember
banks, and their readiness to cooperate in assisting Government
financing has been in continuous evidence throughout the year.
The cordial relations which have hitherto prevailed have continued
throughout the year with the chiefs of the banking departments of
the States within the district, who have given many evidences of
their desire to assist in the development of the system and to recom
mend legislation for the purpose when necessary.
RELATIONS WITH NEW YORK CLEARING HOUSE ASSOCIATION.

In respect to both measures which would assist Government
financing and measures which would make for progress in banking
conditions, the relationship of the New York Clearing House Asso
ciation with the Federal Reserve Bank has continued to be of a
most cooperative nature.
During the early months of the year, it became evident that the
increasing pressure for credit was leading in some directions toward
competitive bidding for deposits which might become injurious to
Government financing and to the general banking situation. The
New York Clearing House Association invited the Governor of the
Federal Reserve Board to address its members upon the subject,
and after considerable study, it adopted, effective October 1, the fol
lowing schedule of maximum rates which members of the clearing
house might pay upon deposits, which were also concurred in by the
important institutions not members of the clearing house:
(а) On deposits of all banks, trust companies, and private bankers
(except mutual savings banks in this district), a rate not in excess
of one-half of the 90-day rate of the Federal Reserve Bank of New
York;
(б) On other demand deposits, not in excess of 3 per cent;
(c) On time deposits, not in excess of 3£ per cent.

ANNUAL REPORT OF FEDERAL RESERVE BANK OF N EW YORK.

Similar action was subsequently taken by a number of other im
portant clearing house associations throughout the country, resulting
in tho curbing of practices undesirable at any time, and peculiarly
unsettling under war conditions.
During the summer the Federal Reserve Bank discussed with the
Now York Clearing House Association the desirability of the pay
ment of bankers' acceptances in cash on the day of maturity instead
of by check collectible through the clearing house on tho following
day. After due consideration the association adopted a ruling,
effective August 1, permitting members to clear on the morning of
the maturity date not only bankers’ acceptances, but notes payable
at clearing banks. This action saved an immense amount of labor
heretofore expended in obtaining checks for accepted drafts and certi
fications of notes, and eliminated from banking statements a con
siderable volume of one day “ float.”
On August 12 the New York Clearing House Association reduced
substantially the exchange charges which its rules compelled its
members to impose for collecting out-of-town checks, and on
October 1 made effective a rule in substance limiting in accordance
with the time schedule of the Federal Reserve collection system the
maximum compensation its members might pay out-of-town banks
for collecting checks on banks on the Federal Reserve par list. The
effect of these rules has already been commented upon on pages
20- 22.

On November l5, by agreement between the Federal Reserve
Bank and the New York Clearing House, the latter abandoned its
out-of-town collection department and the former its collection by
messenger of items on bankers and firms, not members of the associa
tion, who were willing to settle daily for items drawn upon them,
through machinery established by the association. This eliminated
duplication of services by the two institutions and tended toward
consolidation of effort in spheres for which each of the two institutions
was respectively especially equipped.
Throughout the year there have been a number of joint meetings
between the clearing house committee and the executive committee
of this bank, and at several other meetings of the clearirg house
committee the governor or a deputy governor of this bank has been
present by invitation.
RELATIONS WITH FOREIGN BANKS AND THE PROGRESS OF FOREIGN
BANKING.

With the prospect during 1919 of a return to more natural and
normal conditions in international commerce and exchange, it scerrs
appropriate to outline briefly (a) the arrangements which the Federal
Reserve Bank of New York has entered into with foreign banks or

AN N U AL REPORT OF FEDERAL RESERVE BANK OF N EW YORK.

Governments; and (b) the progress which America has made, since
the beginning of the European War, in the establishment of inter
national banking relations.
The following relationships, with the approval of the Federal
Reserve Board, have been concluded between the Federal Reserve
Bank of New York and foreign banks or Governments:
Bank of England.—This is an arrangement of a formal character,
covered by written agreement, ratified by the directors of the two
institutions, covering in detail the basis of the principal operations
and making a close, effective, and complete agency. The business
thus far transacted has been very limited, but under the agreement
can he extended whenever the need arises. In June, 1917, the
Federal Reserve Bank of New York, acting for itself and other Federal
Reserve Banks, paid for account of certain English banks a loan of
852,500,000 with interest, maturing in New York, and accepted in
return earmarked sovereigns of equivalent value in the Bank of
England. During 1918 all but a small amount of this gold was either
shipped to New York or furnished to the Treasury Department for
the use of the United States Government or its allies in Europe.
Bank of France.—A somewhat limited agreement has been effected
with the Bank of France which it is hoped and expected by both
institutions will soon ripen into a closer relationship.
Bank of Italy.—A mutual arrangement has been entered into
between this institution and the Federal Reserve Bank of New York,
whereby each has appointed the other its correspondent* No business
has been or is likely to be transacted between the two institutions as
long as arrangements for dealing with exchange problems growing out
of the war are dealt with by the Governments of the two nations.
Bank of Japan.—Mutual arrangements, similar to those established
with the Bank of Italy, have been concluded with the Bank of Japan,
and although no active business has yet been transacted, it is hoped
that, as in the case of other foreign agents and correspondents, a more
active relationship will develop when international commerce resumes
its natural course.
Philippine National Bank.—In May, 1917, mutual agency appointments were effected between the Philippine National Bank and this
bank, but as the former has an active branch of its own in New York,
the relationship, while ready for operations at any time, is likely to be
largely of an emergency character.
De Nederlandsche Bank.—During 1918, at the request of the
Treasury Department, this bank opened a current account with
de Nederlandsche Bank for the purpose of receiving therein, for the
use of the Treasury Department, the proceeds in guilders of wheat and
other commodities.

ANNUAL REPORT OF FEDERAL RESERVE BANK OF N E W YORK.

Sveriges Riksbank and Norges Bank.—During 1918 accounts were
also opened with the Sveriges Riksbank of Stockholm and the Norges
Bank of Christiania for purposes analogous to those mentioned in the
foregoing paragraph.
Argentina.—Early in 1918 an important arrangement was entered
into between the United States and the Argentine Governments
whereby the Federal Reserve Bank of New York and the Banco de la
Nacion appointed each other as correspondents, and the former
undertook to receive deposits not exceeding $100,000,000 exportable
in gold coin after the proclamation of peace and the deposit of over
$16,000,000 of gold coin then on deposit, earmarked, in New York
and since then withdrawn and exported. The purpose of this agree
ment, which has proved successful in operation, was to stabilize the
badly demoralized exchange situation between the two countries.
Bolivia.—A somewhat similar agreement has been entered into
between the Governments of the United States and of Bolivia
whereby this bank agrees to receive not exceeding $5,000,000 on
deposit which may be exported in gold six months after the
proclamation of peace.
Pern.—Another similar agreement for the stabilization of exchange
has been entered into between the Governments of the United States
and of Peru with this bank as banker, and with a maximum of
$15,000,000 to be received on deposit subject to export at the termina
tion of the present embargo. The agreement is not yet in actual
operation pending the conclusion of certain minor details.
Indian Government.—A very comprehensive arrangement has been
made between the United States and the British Government
whereby the latter supplies the Federal Reserve Bank of New York,
acting for all Federal Reserve Banks, with sufficient rupee exchange
each month to enable importers in the United States to piiy for
necessary imports from India. Up to December 31 the Federal
Reserve Bank of New York had received credits aggregating Rs. 192,500,000, of which Rs. 187,476,132 have been sold and transferred,
with a most satisfactory result in the stabilization of exchange
between the United States and the East.
Prior to the passage of the Federal Reserve Act, national banks
were not permitted to establish branches or agencies abroad, although
some of the State institutions had enjoyed this privilege. During
the past four years some of the State institutions have extended their
foreign branches. The National City Bank of New York with its
affiliated institution, the International Banking Corporation, has
established many branches abroad, and two banking corporations
organized in the United States to carry on banking in foreign countries
have established a large number of branches and relations, par
ticularly with Latin-American countries. It is probable that further
development along these lines will occur during the coming year.

AN N U AL REPORT OF FEDERAL RESERVE BANK OF N E W YORK.

A list of these institutions with their foreign branches and affilia
tions is given in Schedule 5, those marked with a footnote reference
being branches which were established prior to the outbreak of the
European War.
It has been estimated that m July, 1914, not less than 150 foreign
banking institutions maintained branches or agencies in London in
addition to the home offices of many British banks doing business in
all parts of the world. The closest kind of banking contact was
thus maintained between London and foreign countries, and con
duits were established through which money flowed into and out of
London in accordance with the movements of trade and the relation
of London rates to those prevailing in other centers. The number
of such branches and agencies of foreign banks in New York and other
American cities has increased considerably during the European
War, but the limited nature of the business which the law of New
York State permits branches or agencies of foreign institutions to
transact, undoubtedly acts as a deterrent to the progress of the
movement. A branch of a foreign bank may receive no deposits in
New York State, and several foreign institutions, in order to obtain
broader banking privileges than the New York law would permit
their branches to exercise have acquired substantial ownership or
control of American institutions conducting business in New York
City. Among these may be mentioned the Royal Bank of Canada
with its interest in the Merchants National Bank of New York; the
Banca Commerciale Italiana of Milan with a branch of its own in
New York and control of the Lincoln Trust Company of New York,
and The Banco di Sconto del Circondario, owning jointly with the
Guaranty Trust Company the Italian Discount & Trust Company
of New York.
A list of the foreign banking institutions having branches or
agencies in New York and other American cities at the close of
1918 is given in Schedule 6, those established before the outbreak of
the European War being indicated by a footnote.
Many of these banks are large lenders of money and purchasers
of bills in the United States. Many others are large buyers of bills
drawn in foreign countries on American banks, the market for which
in such countries is doubtless much facilitated by the existence of
branches of local institutions in the United States through which
such bills can be readily negotiated. While it may be said that the
establishment of such branches or agencies of foreign banks in the
United States constitutes competition of a certain kind with Ameri
can banks, nevertheless the undoubted widening of banking contact
between the United States and foreign countries which they bring,
and the beneficial effect of such contact upon the development of
dollar exchange and of our discount market, would seem to justify

ANNUAL REPORT OP FEDERAL RESERVE BANK OF N EW YORK.

a reconsideration of the situation from a broad point of view and
possibly some liberalization of the operations which such institu
tions may conduct in New York State.
R EGISTRATION OF D E A L E R S IN

F O R E IG N

EXCHANGE.

Under the operation of the Executive order of the President, dated
January 26, 1918, all dealers in foreign exchange, including bankers,
brokers, and exporters and importers who carry accounts in foreign
countries or carry accounts in the United States for foreign corres
pondents, are required to register with the Division of Foreign
Exchange of the Federal Reserve Board through the Federal Reserve
Banks of their respective districts. Two thousand six hundred and
sixteen such dealers registered through this bank. These dealers were
required to apply through this bank for permission to carry out a
number of classes of operations and to file weekly or monthly re
ports with this bank covering their foreign business. •Passing upon
these applications and recording these reports has required a large
amount of consideration and work.
O

r g a n iz a t io n

th e

a n k

IN T E R N A L M A N A G E M E N T .

The problems of management and operation of the Federal Reserve
Bank have become increasingly complex and difficult during the past
year by reason of the many and important problems arising in con
nection with war finance. The directors have given close attention
and study to these problems, meeting 53 times during the year. The
executive committee, consisting of the governor or deputy governor,
the chairman and four directors (all the directors serving in turn),
held 246 meetings, and other committees held 57 meetings.
The directors, at their first meeting held in 1918, reelected the
officers of the bank for the ensuing year. With the increased activi
ties of the bank, many additions to and promotions in the staff, both
official and clerical, have become necessary. The following officers
have been appointed during the year:
Officer.

Elected.

L. F. Sailer.............

Deputy governor (in addition
to cashier).
Deputy governor (in addition
to secretary1and counsel).
Assistant socretary. .
Cashier.......................
Manager of investments
Assistant cashier.........
Assistant cashier . . .
Assistant cashier...........
Assistant auditor.
Assistant auditor.. .
Assistant auditor........

J. F. Curtis............
D. H. Barrows........
L. H. Hendricks___
E, R. Kenxel..........
L. R. Rounds.........
I. W . Waters..........
J. E. Raasch...........
J. Emison..............
0 . M. Hayward___
W , G. Simpson

Date.
Jan.

Formerly—
3

Jan. 23

Cashier.
Secretary and counsel.

Feb. 6 With Farmers Loan & Trust Co.
June 26 Assistant cashier.
June 26 Assistant cashier.
June 26 Acting assistant cashier.
June 26 Chief clerk.
June 26 Manager of partial payment division.
Sept. 12 Hoad of division, auditing department.
Sept. 12 Head of division, auditing department.
Sept. 12 Head of division, auditing department.

1 Resigned as secretary to take effect Dec. 31,1918.

A N N U AL REPORT OF FEDERAL, RESERVE BANK OF N E W YORK.

On December 31, 1917, the bank, including the fiscal agency
departments, had 16 officers and 829 clerks, 351 of the clerks being
women; at the end of 1918 the staff consisted of 23 officers and 2,630
clerks, and 1,495 of the clerks were women. To maintain theefficiency
of its organization as a necessary war instrumentality of the Govern
ment the directors of the bank took the steps contemplated under
the regulations of the selective service act to have deferred classi
fication on industrial grounds granted those of its employees whose
services were regarded as essential to the adequate and effective
operation of the bank.
A list of the departments of the bank and the number of employees,
in each is given in Schedule 7.
The employees have responded effectively and in fine spirit to the
extraordinary demands upon their time and energy during the year.
In spite of heavy tasks, inadequate, crowded, and scattered quarters,
and the large number of inexperienced clerks, the work of the bank
has been kept up, and in the departments handling Liberty-bond
work the apparently impossible has often been accomplished. Owing
to the very long hours imposed upon many departments, the earlier
practice of allowing supper money to employees working into the
evening was discontinued in February, and a fixed allowance for
overtime substituted.
Living costs having continued to increase because of war conditions,
the directors at the end of June and at the close of the year, with the
approval of the Federal Reserve Board, supplemented the normal
compensation of employees by additional payments as follows:
Period January 1 to June 30: 15 per cent on salaries up to and in
cluding $1,500; 10 per cent on salaries of more than $1,500, up to and
including $5,000. Period July 1 to December 31: 25 per cent on
salaries up to and including $1,500; 20 per cent on salaries of more
than $1,500 and up to and including $3,000; 15 per cent on salaries
of more than $3,000 up to and including $5,000.
To keep pace with the growth of the bank and to meet changing
conditions, several new departments have been organized and exist
ing departments subdivided, as will be noted from the foregoing list.
The growing work of the transit department has already been
described, and the activities of the discount and other departments
may be inferred from the figures which have been given to show the
volume of the bank’s business.
The money department, which handles all currency received on
deposit, now has 74 regular employees, of whom 39 are women, and
in addition receives assistance from some 60 other employees from
this and other banks when overtime work is necessary. Federal
Reserve notes handled in this department during the year and paid
out again as fit for use have amounted to about $423,816,000, while
116015—19----- 3

ANNUAL REPORT OF FEDERAL RESERVE BANK OF N E W YORK.

unfit notes shipped to Washington for cancellation were 23,164,000
in number and $204,160,000 in amount.
The activity of the money-shipping department during the year
may also be taken as a fair indication of the enormous increase-’ in
the volume of transactions of purely banking character. In the
month of January, 1918, the department handled 1,760 shipments,
which included currency shipments amounting to $13,091,655, secu
rity shipments amounting to $22,342,499, and notes shipped to
Washington for cancellation amounting to $11,420,000. In Decem
ber the number of shipments was 5,227, which included currency
shipments amounting to $34,391,694, security shipments amounting
to $41,576,948, and notes shipped to Washington for cancellation
amounting to $19,260,000.
The Federal Reserve agent’s department has been enlarged to
include a Federal Reserve examiner, whose duties will include the
custody of examination reports and reports of condition of all mem
ber banks; investigation and recommendation in connection with
applications of national banks for permission to exercise fiduciary
powers, or of member banks to accept drafts and bills of ex ch an ge
up to 100 per cent of capital and surplus; investigation of reports
and data submitted with applications made by State bunks for
membership; examinations, in cooperation with State authorities, of
State member banks or banks applying for membership; and special
credit investigations of either national or State member banks. An
assistant has also been employed to develop work of statistical char
acter in the bank, and to report on business and economic condi
tions.
The duties of the auditing department have been increased, both
in importance and extent, by the rapid expansion of the bank’s
activities. The number of employees in the department has increased
from 29 to 106, though some portion of this increase is no doubt tem
porary, having been necessary to bring up to date work which had
fallen behind during the influenza epidemic in October.
The custody department was inaugurated at the close of 1917 to
take custody of all securities held for the securities department,
including the securities of this bank and those held for other Federal
Reserve Banks, for member banks, for the Government deposit
department, for the bond issue division, and for the third and fourth
Liberty loan partial payment associations of New York City banks
and trust companies. The department also has custody of the col
lateral to loans and discounts held by the bank’s discount depart
ment. The securities received by the department during the year
totaled about $28,000,000,000, deliveries about $26,000,000,000, and
the balance held December 31, almost $2,000,000,000.

A N N U A L REPORT OF FEDERAL RESERVE BANK OF N EW YORK.

A department has been organized to control all purchases of sup'
plies and the payment of all bills and salaries, and to make reports
upon and analyze all expenses for the directors and officers of the
bank and the Federal Reserve Board. By the organization of this
department substantial economies in buying have been effected, and
unnecessary expenditures avoided.
A complaint and fraud department, organized in June, has handled
several hundred cases of complaint or fraud, principally in connection with Liberty loan campaigns and other war-time matters.
An employment department, in charge of an assistant cashier, has
been created. All applicants for clerical positions are interviewed,
and their qualifications and records carefully inquired into, as ap
pointments are made entirely upon the basis of merit and no effort
is spared to insure the best selections possible. About 100 appli
cants for positions, many of whom have called in response to adver
tisements inserted from time to time, have been interviewed daily.
An efficiency engineer w as employed by the bank during the latter
^
part of the year to study the office methods of the larger departments
of the bank, and suggest changes where needed.
On March 1 a department was organized at the 50 Wall Street
office to promote the welfare of the women employees of the bank.
Early in September the department was moved to attractive quar
ters in the main office at 15 Nassau Street, and enlarged to include
a welfare office and a rest room and library. A medical department
was established, with a visiting woman physician, a head nurse and
two assistants. A cafeteria has also been opened in which about 750
women lunch daily. Well-balanced menus of first quality food are
supplied at prices based on actual cost of food plus the cost of service,
without allowance for overhead charges. The checks average 24 cents
and the cafeteria is proving an unqualified success. Official visitors
from the welfare department call upon all absent employees, both
men and women, who fail to communicate their reasons for absence
from the bank, and this practice has appreciably reduced the num
ber of absentees.
The Federal Reserve Club, which was originally organized among
the employees of the bank in 1914, has grown in membership and
the scope of its activities. Its objects have been the promotion of
social relations, of good fellowship among the employees of the bank,
and educational advancement. The membership now numbers 1,400,
including many of the women employees of the bank. The first
issue of a monthly magazine, to be called Federal Reserve Club
Magazine,” will appear early in January, 1919.

ANNUAL REPORT OF FEDERAL RESERVE BANK OF N E W YORK.
B A N K PR E M ISE S.

The great expansion of the staff during 1918 has made necessary
the occupation of additional space. The bank, including the
Liberty loan organization, has occupied not only its office on the
ground floor, portions of the third, fourth, fifth, eleventh, twentythird, and thirty-first floors, and the entire twenty-fourth and
twenty*fifth floors of the Equitable Building, but the entire
building at 50 Wall Street, six floors at 37 Liberty Street, and space
at 39 and 41 Liberty Street and 19 West Forty-fourth Street, amount
ing altogether to 203,258 square feet, as compared with 65,000 at
the closo of 1917 and 21,625 at the close of 1916.
The most unsatisfactory working conditions under which the bank
has been operated led the directors of the bank in May, with the
approval of the Federal Reserve Board, to purchase a plot of land
extending from Liberty Street to Maiden Lane and running eastward
from Nassau Street, covering 33,509 square feet, at a cost of
$3,121,492.39, upon which the bank will erect its own building in
due time.
On September 3 a consulting architect was engaged to study the
special requirements of the various departments of the bank, in order
to obtain data for the preparation of a basis for a competition among
architects when the bank is ready to ask for plans for a building.
This preliminary work is expected to require almost a year of study.
ELECTION OF DIRECTORS.

The amendment to section 4 of the Federal Reserve Act, approved
September 26, 1918, provided that for the purpose of the election of
directors the Federal Reserve Board should classify the member banks
of the district into three groups, each group to consist as nearly as
may be of banks of similar capitalization, the earlier requirement that
the groups should be of approximately equal numbers having been
eliminated. The Federal Reserve Board classified the banks of this
district as follows: Group 1, banks having capital and surplus in
excess of $1,999,000; group 2, banks having capital and surplus not
exceeding $1,999,000 and not below $201,000; group 3, banks having
capital and surplus below $201,000.
The result of this classification was to place in group 1, which will
elect directors at the end of 1919, 55 banks, of which all but 5 are in
New York City or adjacent territory. Group 2, which will eleot
directors at the end of 1920, includes 180 banks located in the larger
and medium-sized cities of the district, and group 3, which partici
pated in the 1918 election, includes 479 banks located for the most
part in the smaller towns and villages.

AN N U AL REPORT OF FEDERAL RESERVE BANK OF N E W YORK.

To fill the vacancies caused by the expiration on December 31,
1918, of the terms of Franklin D. Locke and Leslie R. Palmer, as
directors of class A and class B, respectively, an election was held
from November 19 to December 10. Of the 479 banks in the
group which were entitled to vote this year 337, or 70 per cent, voted,
a much higher percentage than in any previous election. The follow
ing candidates were nominated:
For class A director: William S. Gavitt, of Lyons, N. Y.; Robert J.
Gross, of Dunkirk, N. Y .; Charles Smith, of Oneonta, N. Y.
For class B director: George Alfred Cluett, Troy, N. Y.; Manton B.
Metcalf, of Orange, N. J.; Leslie R. Palmer, of Croton-on-Hudson,
N. Y.
At the closing of the polls it appeared that the following votes had
been cast in the column of first choice: For class A director: William
S. Gavitt, 109; Robert J. Gross, 21; Charles Smith, 197. For class B
director: George Alfred Cluett, 65; Manton B. Metcalf, 71; Leslie R.
Palmer, 195. Mr. Smith was declared elected class A director and
Mr. Palmer class B director, each for a term of three years, beginning
January 1, 1919.
George Foster Peabody, class C director, whose term expired Decem
ber 31, 1918, has been reappointed by the Federal Reserve Board for
a three-year term ending December 31, 1921, and designated deputy
chairman of the board for 1919. On December 11 the Federal Re
serve Board designated Pierre Jay as chairman of the board and Fed
eral Reserve agent for 1919.
MEMBER OF ADVISORY COUNCIL.

On January 9 the directors reelected J. P. Morgan, of New York
City, a member of the Federal Advisory Council from Federal Reserve
District No. 2 for the year 1918.
F is c a l A

gency

O p e r a t io n s .

The major financial undertaking of the war was the floating of
Liberty loans. The problem was not limited to selling bonds; it in
volved the creation of a new public state of mind toward investments.
The Federal Reserve Banks of the country were the chief agencies
through which the Secretary of the Treasury operated in meeting this
problem. To them at all times and in all circumstances the Treasury
Department gave the fullest support within its power, thereby lighten
ing materially the burden of their obligations. They were the adminis
trative centers for the work of numberless local Liberty loan commit
tees^which, under the leadership of the director of war loan organization
in Washington, formed the greatest bond selling organization ever
created. To the Second Federal Reserve District fell the necessity of

ANNUAL EEPOET OF FEDERAL RESERVE BANK OF N EW YORK.

absorbing nearly a third of all the bonds and nearly one-half of all
the certificates of indebtedness issued by the Treasury. In the 19
months of our participation in the war the banks and organizations
working witli the Federal Reserve Bank of New York sold
$4,942,374,000 of Liberty bonds, and up to December 31, 1918, cer
tificates of indebtedness amounting to $6,512,835,500.
On the Federal Reserve Banks, also, rested the responsibility of so
administering the financing of the loans that the expansion of credits
should be no greater than necessary to insure successful flotation and
that the money markets of the country should not suffer dislocation.
These problems have been met with measurable success. In the main
the Liberty loans have been sold to investors, thus sparing bank
funds for commercial and other Government necessities.
CERTIFICATES OF INDEBTEDNESS.

The sale of certificates of indebtedness in anticipation of the
Liberty loans provided the Treasury with funds to meet the current
requirements of the war. The Liberty loans converted these short
credits into long-time credits and spread them among individual
investors.
In the 12 months of 1918 the Federal Reserve Bank of New York
sold a total of $4,091,260,000 of these certificates of indebtedness.
This total includes both the issues made in anticipation of Liberty
loans and the issues of tax certificates. On February 8, in anticipa
tion of the third loan, the Secretary of the Treasury notified the
banks that its requirements probably would be $3,000,000,000,
and therefore requested every bank and trust company to set aside
each week 1 per cent of its total resources for investment in certifi
cates. The plan, as he then outlined it, was to continue for 10 weeks.
On June 12, in anticipation of the fourth loan, the weekly quota was
fixed at
per cent of the total resources of each bank and trust
company. The anticipated requirements were $6,000,000,000. The
same rate of subscription was requested during the month of Decem
ber in anticipation of the fifth loan.
The record of subscriptions in the Second Federal Reserve District
during 1918 is given in Schedule 8.
The largest volume of these loan certificates outstanding at any
one time in this district in the third Liberty loan financing period
was $835,938,000. In the fourth Liberty loan financing period the
corresponding figure was $1,680,989,000.
The banks of the district gave the heartiest response to the call of
the Secretary of the Treasury. Of the 1,234 banks, all but 45 sub
scribed to the issues. The list of subscribers included even a great
majority of the savings banks. Further, the sales were far more

AN N U AL REPORT OF FEDERAL RESERVE BANK OF N E W YORK.

general throughout the district and the country than in 1917, when
the New York City banks subscribed far in excess of their quota.
The satisfactory change to a wider distribution of the fourth loan
certificates was the result of intensive work by a newly developed
sales organization established along county lines, with a county
director as supervisor of sales in his neighborhood. The county
directors, each of whom was a representative banker in his own
community, met in New York and received the details of the plan from
the deputy governor of the bank and the director of sales. Similar
meetings were held in the local communities at the call of the county
directors, who prosecuted their work with the greatest energy, and
in many cases organized county bankers’ associations.
In addition to discussing with the banks the Government’s necessi
ties, and the fairness of the plan by which its temporary credit should
be supplied by the banks ratably in proportion to their resources,
the organization explained to the bankers the method of paying by
book credit and of obtaining advances from the Federal Reserve
Bank, which many of them had not understood.
Stated in tabulated form, the subscriptions allotted to the various
classes of banks were as follows:
Class of bank.

; Number Number
j m second subscrib -1
| district.
ing.

____
________
St at, p._____
j
Trust com panies. . . . - ........*. - .......................................... .

625
229
202
178

616
225
195
153

1,234

1,139

Individuals and firm s..... ............. . . ........ _ .......... .......
Tntal

_____

. ____ ____

!
i
'
!

i
Allotment.

Percent of
total al
lotment.

$2,429,518,000
272,319,500 j
1,222,246,500 !
40,529,000
126,647,000

59.4
6. 6
29.9
1.0
3.1

4,091,260,000

100.0

The amounts showr as purchased by individuals and firms are
n
very largel}’ tax certificates purchased in anticipation of the pay*
ment of income taxes.
The banks outside New York City subscribed to fourth loan
certificates 10S per cent of their total quota, as against 53 per
cent to third loan certificates; the New York City banks subscribed
139 per ccnt of their quota to fourth loan certificates as against
129 per cent to third loan certificates, despite the fact that the quotas
assigned were materially increased.
Although advances against certificates purchased by both member
and nonmember banks were made, the volume which the Federal
Reserve Bank was called upon to carry was comparatively moderate.
On October 23, for example, when the certificates preceding the fourth
loan were at their maximum $1,681,000,000, the amount carried by
the Federal Reserve Bank was $424,000,000, or about 26 per cent of
the total.

ANNUAL REPORT OF FEDERAL RESERVE BANK OF N EW YORK.

THE LIBERTY LOANS.

The record of sales of Liberty bonds in the Second Federal Reserve
District shows, in common with other districts, that quotas assigned
have been generally exceeded. In the report of the Federal Re
serve Bank of New York for last year it was shown that the sub
scriptions received far exceeded the informal apportionments made
by the Treasury Department, and were also in excess of the amounts
ultimately allotted. Subscriptions made in 1918 were accepted in full.
The comparative statement showing the results of all loans reflects
a remarkable increase in amounts, as well as in the number of indi
vidual subscribers. The second district’s total sales in the fourth
loan were greater than the entire sum accepted by the Treasury from
all districts in the first loan. Further, and of greater importance to
the financial position of the country is the fact that the subscribers
to the third loan were 50 per cent more numerous than in the second.
By this fact it is possible to measure the success with which the third
loan, as compared with previous loans, was sold to individual investors.
The more widely extended sale is also indicated in the reduction of
the size of the average subscription of $1,212.29 in the first loan to
$366.47 in the third, a figure which, however, was increased in the
fourth loan, when the quotas for the country and district were twice
as great.
The record of the Second Federal Reserve District is as follows:
Quota.

First loan..............
Second loan..........
Third loan............
Fourth loan...........

Amount sub
scribed.

Amount al
lotted.

9600,000,000
900.000.000
900.000.000
1,800,000,000

$1,186,788,400
1,550,453,450
1,115,243,650
2,044*901,750

1617,831,650
1,164,366,950
1,115,243,650
2,044,901,750

Number of
subscribers.

Average
subscrip
tion.

978,959
2,182,017
3,043,123
3,604,101

$1,212.29
710.55
366.47
567.39

Amount
per
capita.
$94.67
123.69
88.98
163.14

Hardly less significant than the great growth of the individual sub
scriptions from loan to loan is the increase in the number of large
subscriptions in the fourth Liberty loan as compared with the third.
The number of subscriptions in excess of $10,000 more than doubled,
and the number of subscribers in amounts exceeding $200,000 in
creased from 430 to 967. Part of this great increase is attributable to
the willingness of the banks to extend generous credits to subscribers.
The borrow and buy’1campaign, adopted from necessity, was very pro
ductive of large subscriptions. The terms made by New York banks
allowed the investor to borrow at 4J per cent for 90 days; thereafter
t e banks made varying agreements with subscribers, some to carry
on successive renewals for a year at the coupon rate; others at onehalf of 1 per cent above the Federal Reserve Bank rate. The figures

A N N U A L REPORT OF FEDERAL RESERVE BANK OF N E W YORK.

for the third and fourth loans are given in Schedule 9 for purposes of
comparison.
The work of the banks of the district in the loan campaigns was
most enthusiastic. The tabulation of results shows a very even
ratio of subscriptions received through the several classes of banks
in the two loans. In Schedule 10 are stated in tabulated form the
subscriptions, classified accordingly to the kind of bank through
which they were made.
The record made by the different geographic subdivisions of the
district is given in Schedule 11. It should be understood in con
sidering the figures for the city of New York, that many persons
living in other parts of New York have subscribed in Manhattan
and have paid for their subscriptions with funds drawn from
Manhattan banks; hence the low apparent per capita subscriptions
in certain of the other boroughs. Further, the per capita for Man
hattan is materially increased because of the immense corporation
subscriptions placed with Manhattan banks.
FIXED ORGANIZATION ESTABLISHED.

The progression of the Liberty loans forced this bank to modify
radically its plan of administration. In the first loan, so rapid were
the steps from the announcement to the close of the sale that the
Federal Reserve Bank of New York depended almost exclusively
upon volunteers whom bond houses, banks, and corporations could
spare for the emergency. This plan of organization applied not
only to the selling force but to that division of the bank which
received subscriptions and made deliveries of bonds. It became
apparent very soon that a closer organization was necessary, and
the bond-issue division was created accordingly, with its staff of fixed
employees.
During the second Liberty loan the principal responsibility for
selling bonds in this district again rested upon volunteers, who served
with unabated industry during the period of the campaign and for
some time before it. But with the mapping out of plans for the
third loan, it was seen that there was little or no interval between
the close of one loan and the preparation for the next. Condi
tions were changing. In the earlier loans the patriotism of the
T
country carried the campaign through successfully. But with the
diminution of surpluses and the necessity of striking deeper, of
enlisting the support of every American, a more intensive cam
paign was requisite, and for it a more closely knit organization. A
fixed establishment of paid employees was therefore built up, which
enlarges and contracts as the demands of the campaign prescribe.
At the close of 1918 the paid personnel of the Liberty loan organiza
tion in this district numbered 1,210 persons, including the employees

ANNUAL. REPORT OF FEDERAL RESERVE BANK OF NEW YORK.

in the fiscal-agency departments of the bank working on the Liberty
loan and certificates of indebtedness activities.
A great many volunteers nevertheless remain, but save for a few
executives permanently associated with the central organization,
they are engaged in the work of the loan only during the campaign
and the period just before it. Among them are not only those who
act as chief advisers in framing and carrying out the policies of the
campaign but a great number of chairmen and members of Liberty
loan committees, who have the hard task of carrying to a successful
finish the loan campaigns in the local communities.
In the early loans local committees assumed many of the expenses
of their work, but because of the succession of campaigns and the
recognition of Liberty loan activities as a continuous operation of
the Government, these expenses have become more and more a charge
upon the Treasury. Further, because of the very fact that Liberty
loan campaigns by their repetition have ceased to be novelties, it
has been necessary to carry on at once a more extensive and a more
intensive canvass. The results have been apparent in the vastly
increased volume of individual subscriptions and also in the amount
of bonds sold. But the expenses, especially as between the second
and third loans, have increased materially.
To administer the disbursement of funds in more systematic
fashion, the comptroller’s department early in 1918 became a part
of the continuing organization. It purchases all equipment and
supplies, pays all salaries, reimburses local committees for their
expenses, maintains all accounts and is the custodian for the com
mittee’s property. Its disbursements in 1918, including the costs
of the fiscal agency divisions of the bank, amounted to about
$4,250,000, all of which it paid with Federal Reserve Bank funds.
These expenditures in turn are revouchered to the Treasury Depart
ment, by which the bank is repaid. A closely segregated budget for
the regular organization and separate budgets for the campaign activi
ties have been framed. Through a system of weekly reports of lia
bilities registered the comptroller is advised at all times whethei
the various branches of the organization are living within their
appropriations.
The federal Reserve Bank of New York wishes here to record
and acknowledge the services rendered to the Government by all
those who labored for the success of Government financing in its
fixed and its volunteer organizations. Regardless of their own con
venience, interests and health, they worked for the successful per
formance of whatever tasks were assigned to them with the utmost
devotion and patriotism.

A N N U AL REPORT OF FEDERAL RESERVE BAN K OF N E W YORK.
THE

CENTRAL

L IB E R T Y

LOAN

C O M M IT T E E .

The central Liberty loan committee in this district is the dynamic
center of the whole organization. It was established at the opening
of the first Liberty loan campaign, was enlarged prior to the second,
and is now composed of 15 bankers, with the governor of the
Federal Reserve Bank of New York as chairman. Its membership
includes the responsible heads of many of the largest banks and
banking houses in New York. The committee meets frequently
during the progress of the loans and at such other times as business
of importance develops. It is far more than an advisory committee;
it is the body which determines the policies to be followed in selling
the loan, the nature of the appeal to be made to the buyers, and the
financial measures of an extraordinary nature to be taken for insuring
the success of the loan. The attitude of these bankers has at all
times been of the most patriotic nature and their services have been
of inestimable value to the success of the Government’s financial
programme.
THE

SALES

O R G A N IZ A T IO N .

Immediately in charge of sales is the distribution organization,
of which a member of the central Liberty loan committee has been
chairman. Its members are bankers or partners in bond houses.
Eight of their number act as chairmen, respectively, of the eight
subdistricts into which the Second Federal Reserve District (with
the exception of three boroughs of the City of New York) is divided.
Working at headquarters is the permanent staff of the distribution
committee, at the head of which is the director of distribution, whose
function is that of a responsible executive in charge of an immense
and very active bond-selling organization. The headquarters’
business of the distribution committee is handled by a staff which
numbers 99 persons, including the executive secretaries who act as
assistants to the subdistrict chairmen.
O R G A N IZ A T IO N

O U T S ID E

M E T R O P O L IT A N

D IS T R IC T .

The subdistrict chairmen establish the connection between the
central organization and the local Liberty loan committees. Each
is the adviser of the local chairmen within his subdistrict, and is
responsible for the success of the loan within its limits. He transmits
and adapts to the requirement of local communities the plans pre
pared at headquarters, and sees that the local committees make
full use of material prepared there, in so far as it is fitted to local
requirements. The local committees develop ideas and plans of
their own with the greatest ingenuity, making their campaigns per
sonal and direct to their own citizens.

ANNUAL REPORT OF FEDERAL RESERVE BANK OF N EW YORK.

The highly creditable showing made in the subdistricts is directly
attributable to the energy and capacity of the chairmen of the local
committees, who have served with a high sense of patriotism, en
tirely forgetting their personal affairs during the loan campaigns and
devoting themselves to their success. In the small towns the local
chairman has worked with limited resources, but has covered his
territory personally and with his committee, soliciting subscriptions
and arousing people to a full sense of their obligation.
In the larger towns the methods have been similar to those employed
in the metropolitan district. Many of the chairmen responsible
for large or populous areas have made card indexes of all possible
subscribers, working out in detail the plan of assigning quotas to
component communities. Subscriptions have been sought, howeverr
on a purely voluntary basis.
In the third loan campaign there were 1,425 local men’s com
mittees, each with its chairman and members drawn from the leading
citizens of the neighborhood, numbering in all 21,200. The number
of men’s committees in the fourth loan rose to 2,075, with a total
membership of 30,800, to which should be added a vast army of
volunteers composed of associate members, members of allied organ
izations, canvassers, speakers and workers, all serving with the
single purpose of achieving this district’s share of the Liberty loan.
O R G A N IZA T IO N

IN M E T R O P O L IT A N

D IS T R IC T .

Only two of the five boroughs of the city of New York were
included in the subdistrict organization. These were Queens and
Richmond, which were regarded as parts of the Long Island subdistrict. The other three boroughs, Manhattan, Brooklyn, and The
Bronx, because of their immense population and special character,
were treated separately as constituting the Metropolitan District.
Brooklyn and TTie Bronx each had its own borough organization.
Manhattan was covered by many organizations, some of which
inevitably overlapped, and was in many ways the center for the whole
campaign in the Second Federal Reserve District.
The organizations which concentrated on the Borough of Man
hattan were not for the most part limited by geographic lines, but
Manhattan was the chief field of activity. These organizations
included an advisory trades committee, which alone accounted for
half of the subscriptions secured in the Second Federal Reserve
Distiict; a metropolitan canvass committee, composed of 90,000
workers, which devoted itself to the house-to-house and man-toman campaign; the commercial banks and trust companies commit
tee, which was organized for the first time shortly before the third
loan for the purpose of coordinating the Liberty loan work of the
financial institutions of the city ; the municipal employees committee,

AN N U AL REPORT OF FEDERAL RESERVE BANK OF N EW YORK.

which canvassed the 100,000 employees of the city of New York; the
insurance committee; the New York Stock Exchange committee; the
Consolidated Stock Exchange committee; the public utilities commit
tee; the New York Cotton Exchange committee, and the religious
organizations committee. Of these, the two largest in point of mem
bership were the advisory trades committee and the Metropolitan
canvass committee.
The advisory trades committee.—This committee, composed of 14
executive members, each of whom in turn was responsible for the
campaign among five to twelve groups of trades, aimed to secure
corporation and firm subscriptions, and the subscriptions of employes.
In the fourth loan every effort was made to have the employees of
large concerns control their own Liberty loan committees, thereby
removing the element of employer’s compulsion in securing sub
scriptions. The quota assigned to the advisory trades committee
in the third loan was arbitrarily fixed at half the total quota for the
Second Federal Reserve District. A week before the end of the
campaign the committee passed its second loan total, and on the day
before the close exceeded its quota. Over 5,000 industrial honor
flags were awarded to individual firms or plants where 60 per cent
or more of the employees subscribed. In the fourth loan a com
plete card index of all industrial concerns was prepared, forming a
list of prospects which was allotted among 85 subcommittees, having
an aggregate membership of 3,485 and an organization of 18,000
volunteer workers, which canvassed approximately 125,000 con
cerns in the greater city. The quota, fixed at 90 per cent above the
quota assigned for the third loan, was greatly exceeded. The com
mittee’s record was:
Quota.
i
i
Third loan.
Fourth loan.

.
-.

................................ *........ *............
......................... - ..............*...................

....

Amount of
subscriptions.

s m ooo, ooo
865,205,000

$564,767,950
1,083,801,000

The metropolitan canvass committee.—This committee undertook
the house-to-house canvass in the Boroughs of Manhattan, Brooklyn,
and The Bronx. ' It was organized according to the precincts of the
municipal police department, with a borough chairman, and a cap
tain and lieutenants in each precinct. Aside from the intensive
work within the precincts it carried on a campaign through the
public schools, held innumerable street meetings, many large mass
meetings in public halls and armories, and supervised a flying squad
ron of “ traveling banks7 which took subscriptions in many parts of
'
the city. In the fourth loan it augmented its plan of organization by
making use of the extraordinary ability of the police and fire depart

ANNUAL REPORT OF FEDERAL RESERVE BANK OF N EW YORK.

ments to soil bonds. The total number of subscriptions received
through the committee was:
Number of
subscribers.
1,099,367
1,296,511

Third loan...
Fourth loan.

Amount of
subscriptions.
$145,475,609
378,480,059

W O M A N S C O M M IT T E E .

This committee was developed from the comparatively haphazard
association of workers in the first Liberty loan to a closely knit
well-administered organization in the fourth Liberty loan. The
activity of women in support of the Liberty loan has been one of the
particular features of the campaigns in this district. They have
shown an increasing desire to work for the loans and in many cases
have regarded it as a privilege.
In preparation for the third loan campaign 1,310 local committees
were organized in 70 counties, with about 18,500 volunteer workers—
a threefold increase from the second loan. The returns indicate that
the woman's committee procured at least $110,000,000 of sub
scriptions. This figure is probably considerably less than the actual
total secured, because in many cases the results were merged with
reports of the men’s local committees.
In the fourth loan campaign they were still more intensively
organized, with commensurate results. There were 1,861 local com
mittees in 72 counties, and about 35,000 workers. The subscriptions
secured amounted to $203,383,850, almost all in small amounts.
More than 562,000 individual subscriptions were in amounts of less
than $500. In other words, the woman’s organization was responsible
for 16 per cent of the number of subscriptions, and 10 per cent of the
amount of bonds sold in this district.
P A R T IA L

PAYM ENTS.

I rom the first of the Liberty loans there was a very general demand
*
throughout the country for installment purchases on an easier basis
than that provided in the Government plan. Various expedients
were resorted to. In many cases employers carried the bonds for
their employees. In others, banks agreed to carry bonds for sub
scribers in their neighborhoods on the basis of weekly or monthly
payments. A duplicate card system, enabling banks by a single
punch to record payments made by subscribers, was made available
for free distribution to the banks generally in this district, besides
which a number of banks developed their own plans. In the first
campaign, in so far as figures are available, the number of partial

AN NU AL REPORT OF FEDERAL RESERVE BANK OF N EW YORK.

payment subscribers was comparatively small. But as greater efforts
were made in the second campaign, a large number of small sub
scribers was secured, the estimated number for Greater New York
being 318,000, with an aggregate subscription of $29,500,000. The
result, from the standpoint of both banks and subscribers, was
far from satisfactory. Subscribers found that paying week after
week at the same bank during the usual banking hours cost them time
and carfare equal perhaps to the value of the bonds which they were
purchasing. Further, banks and branches of banks in outlying
districts and in centers of dense population carried by far the greatest
part of the burden, while the large banks in the financial district
whose resources and staff were best able to take care of the work had
comparatively little to do.
With the approach of the third loan, the Liberty loan organization
had to choose between discontinuing partial payments in the Metro
politan district or providing a mechanism whereby the operation
could be handled under the supervision of the Federal Reserve
Bank. The latter alternative was taken and, with the approval
of the Treasury Department, the Liberty Loan Association of banks
and trust companies of New York City was formed. This was a syndi
cate of 130 banks, which agreed to subscribe for and carry a total of not
over $100,000,000 in bonds for the benefit of small subscribers. Coupon
books were sold at $2 each for $50 bonds and $4 each for $100 bonds with
the understanding that payments should be made once a week for 48
weeks. The subscriber presented his book at any one of the 680 banks
or payment stations throughout the greater city, which received the
payment, stamped a coupon, detached it, and sent it to the adminis
tration office of the Liberty loan association where the payment was
recorded, and through which, when the payments had been com
pleted, the bond was delivered. This undertaking involved the
handling of more than 800,000 active accounts, some of which are
constantly being closed out with adjustments of interest and the
return of the principal, and many of which are delinquent and
require a notification and adjustment. The staff required to handle
this operation is at present 317 persons. When the books were first
opened work went on in two shifts through most of the 24 hours of
the day.
In the fourth loan, the plan was again adopted, but with important
administrative changes reducing materially the cost of the operation.
Instead of the detachable coupon, the subscriber purchases gummed
receipts which are placed in the books as a record of payments. The
plan also provided for a follow-up method of reaching delinquent
subscribers. The cost of administration has been materially less and
the number of employees required to handle it is about 130.

ANNUAL REPORT OF FEDERAL RESERVE BANK OF N EW YORK.

The smaller number of subscriptions received in the fourth loan
plan is undoubtedly accounted for because the initial payment was
8 per cent., and because payments were to be completed in 23
instead of 48 weeks. The comparison is as follows:
Third loan.
Books sold........................ . ............. . . . .............................
V aluo of bonds.................. . .......................................

836,363
$46,700,000

Fourth loan.
786,000
$44,100,000

Total.
1,622,363
$90,800,000

The two plans require the handling of upward of 1,600,000 current
accounts. The number of persons calling, at the office of the asso
ciation to pay up in full and receive their bonds or to make inquiry
about their subscriptions has reached in a single day as high as 15,000.
P U B L IC IT Y .

Hand in hand with the sales organization, and as an essential
accompaniment to its purpose of selling bonds is the publicity organ
ization. But the publicity department has had before it a purpose
not limited to the sale of the Liberty loan, nor even limited to the
immensely greater object of producing in the minds of the American
people a desire to save and to invest. Liberty loan publicity has
consistently worked to spread the ideas America had in entering the
war and to declare the need for attaining a decisive victory. In
every newspaper and magazine, on every billboard, on every fence,
on almost every lamppost, vehicle, and flagstaff, and in almost every
store and householder's window the message of the Liberty loan and
of America has been carried.
The publicity of the first and second loans laid the groundwork of
a genuinely American appeal, showing the necessity for winning the
war and the obligation of every American to participate in its high
purposes. With the opening of the third loan our active part in the
armed conflict had begun. The German spring campaign was in its
full flood, and everywhere was a lurking fear as to how far it might
go. The note of danger, of the very serious menace confronting the
free nations of the world, together with the determination of the
I nited States to see it through, was the burden of the printed and
spoken word carried in the publicity material. The events in France
furnished the visible support to all that was said and written, and the
se ecti\ e service act had brought the fact of war to every neighborhood
in a most concrete way. These things, dwelt upon in pamphlet,
poster, and public speech, were reflected in the immensely increased
volume of popular subscriptions.
When the early preparations were under way for the fourth loan
it seemed likely that similar conditions would prevail and that the
ideas behind fourth loan publicity should be to the same effect as

AN N U AL REPORT OF FEDERAL RESERVE BANK OF N EW YORK.

before. The designs for posters selected in Washington in June for
the whole country depicted war in its grimmest aspects, and even
went to the point of warning America against German invasion of our
own shores. Some of the advertising and pamphlets prepared in that
early time reflected the same thought. But by the time the cam
paign had arrived the face of the war had completely changed—
to a degree far greater than the most optimistic in June had dared
to hope. Added to the tendency toward relaxation of concrete
efforts which victories on all fronts induced was the German peace pro
posal, launched in the midst of the loan campaign. The complete
shift in conditions forced a corresponding change of methods in the
very heat of the campaign. This district threw out a last-minute
appeal to “ Double the third,” the effect of which was to put the
campaign in competition with its forerunner, and on a domestic basis.
Special acknowledgment should be made of the invaluable services
rendered to this district by the publicity bureau of the Treasury
Department.
P U B L IC IT Y

O R G A N IZ A T IO N

AND

RESULTS.

The publicity department in this district carries on its work along
five lines, each administered by a separate bureau—press bureau,
feature bureau, advertising bureau, the bureau of speakers and
meetings, and the foreign language bureau.
The press bureau is established on the plan of a modern news
paper office with editors, editorial writers, writers of special articles,
and reporters. Prior to the campaign it supplies articles of a general
nature to magazines throughout the United States and prepares
special material for production in Sunday newspapers during the
period of the campaign. Included in this material are cartoons,
editorials, poems, articles for trade, technical, and financial maga
zines, farm periodicals, theater programs, and labor magazines.
During the campaign it gives daily news, not only of the results of
sales, but of the numerous activities carried on by various Liberty
loan organizations throughout the city and district, including a very
considerable amount of plate matter sent out to weekly newspapers.
All told, during the third loan the press bureau records show that
26,850 columns of matter was printed in the form furnished; in the
fourth loan the total rose by 7,000 columns. The total number of
Liberty loan articles printed in the district increased from 111,207
to 141,443, with a total of 59,932 columns.
The feature bureau, which has the work of preparing and producing
special Liberty loan features of a publicity nature, undertook the
direction of all parades, indoor and outdoor exhibits, the production
of moving pictures, and the supply of flags, banners, badges, and nov
elties. In the third loan it had as the principal feature of its New
116015—19----- 4

ANNUAL REPORT OF FEDERAL RESERVE BANK OF N E W YORK.

York City campaign, “ Liberty land,” a war exhibit in the Sixty-ninth
Regiment Armory, where the first veterans to return to this country
from Gen. Pershing’s forces and a detachment of French chasseurs,
the “ Blue Devils,” were presented in a dramatic way to audiences
aggregating 250,000 in 19 days. In the fourth loan it made the
“ Liberty altar” at Madison Square the center of Liberty loan activi
ties. It was at the foot of “ The Avenue of the Allies” into which
Fifth Avenue was transformed. This great center for Liberty loan
pageantry was an expression of the idea of unity among the free
nations of the world. Members of the French Foreign Legion, the
Italian Bersaglieri, the Alpini, the French Army Band, and the Italian
Grenadier Band participated in the campaign under the direction of
the bureau. Certain of them appeared in the Liberty day parade led
by President Wilson, in which 35,000 persons marched. Others served
throughout the district, singly and on special trains.
The advertising bureau, the largest branch of the publicity organi
zation, prepared all newspaper advertising put out from headquarters,
secured advertising space, and developed advertising printed matter
in great variety, which it distributed through the district. The value
of the advertising space obtained through the generosity of mer
chants, bankers, manufacturers, and private contributors for the third
loan between January 1 and June 1 was estimated at $1,750,000 ; in
the fourth loan at more than $2,000,000. For the third loan the
bureau distributed nearly 85,000,000 pieces of printed matter, of
which 47,000,000 were published in this district; in the fourth loan
96,000,000 pieces were distributed. In the fourth loan the services
of many artists known throughout the country were used in the pro
duction of special canvasses for window display and for billboard re
production.
In response to requests made to the speakers’ bureau, many mem
bers of the diplomatic corps and officers of the Federal and State
governments, as well as many hundred men and women of prominence,
spoke at Liberty loan meetings throughout the district. The chief
of these was held at the Metropolitan Opera House in New York City
just prior to the opening of the fourth loan campaign, when President
Wilson made his last public address before Germany entered upon the
discussion of peace.
The work of the foreign language bureau, coordinated with the
other bureaus of the publicity department and with the distribution
committee, carried the work of the Liberty loan among the foreignborn residents of the district. The increase of their interest is shown by
the fact that in the second loan about 25 per cent o f the foreign -b orn
residents subscribed to Liberty bonds, in the third 55 per cent, and
m the fourth 80 per cent.

AN NU AL REPORT OP FEDERAL RESERVE BANK OF N EW YORK.

The publicity department, in addition to many volunteers, had a
personnel of 664 paid employees in the fourth loan campaign, includ
ing 201 persons in its fixed organization.
R E C E IP T S ,

D E L IV E R IE S ,

EXCHANGES,

AND

C O N V E R S IO N S .

An index to the size of the Second Federal lieserve District’s par
ticipation in the Liberty loans appears in the record of transactions
of the bond issue division <f the Federal Reserve Bank; but to com
prehend their volume it is necessary to imagine a corporation with
over 3,000,000 bondholders, with bonds in many denominations, of
seven different issues, and distributed among holders unaccustomed
to financial practices. As a matter of fact the bond issue division,
which handles tins vast volume of business, deals also with bonds
sold in other districts which find their way t o New York for exchange
or conversion.
Through the ability of the Treasury Department to supply definitive
bonds early in each of the two campaigns of 1918, it has been possible
for the bond issue division to give far more prompt service than during
1917. In the case of bonds sold for cash during the campaign deliv
eries have been made immediately. In the third Liberty loan the
number of pieces so delivered was 999,378. This figure rose to
1,352,586 in the fourth Liberty loan. At the close of business Mon
day, November 4, the day on which payments and deliveries should
be made on coupon bonds of the fourth loan paid for in full, a total
of certificates of indebtedness, credits, and cash had been received
against subscriptions amounting to $1,484,329,895. On that day
also 2,560,473 pieces were available for delivery by banks throughout
the district and out-of-town banks were able, because of prior receipts
of bonds, to make deliveries to subscribers on exactly the same footing
as banks in New York City.
The following table shows the comparative transactions in the
third and fourth loans, the transactions in the latter running only to
December 31:
Third Liberty loan.
$144,276,250.00

$224,640,050.00

1,115,243,650.00
2,048,165.46

1,854,038,500.00
920,626.41

187,223,000.00
797,301,916.55
132,766,898.91

712,758,500.00
999,295,804.89
142,904,821.52
1,422,001, . m o o
151,405,500.00
91,112,400.00

. .......

796,88*', 900.00
58,266,650.00
78,823,300.00
181,266,800.00

........................*.................. **............

1,049,020,350.00

66,223,300.00

1.517,611,S00.00
5,201,150.00

4,149,163
71,614

4,145,150
8,721

Cash sales during campaign
*.............................- _ . . . ................
_
Total receipts, including cash sales:
Method of payment:
Certificates of indebtedness. ..................................... ..................
Bonds full-paid with:
Sccond installment date
Prtiirth inctallmnnt
liond deliveries:
Coupon bonds

........................*.......................**.....

Number of pieces delivered:

Fourth Liberty
loan.

ANNUAL REPORT OF FEDERAL RESERVE BANK OF N EW YORK.

Throughout tho year exchanges were freely made from one denomi
nation to another of the same issue, immediate deliveries being made
in every case. The exchanges indicate that a large number of small
denomination bonds which have been sold by subscribers are in
constant process of exchange into bonds of $1,000 denomination.
Tho total volume exchanged during 1918 was in excess of
$1,100,000,000. The number of pieces handled was: Received,
4,103,229 pieces; delivered, 1,637,490 pieces.
The conversion privilege attaching to the two earlier issues has also
resulted in large deliveries of new bonds. The bank made every
effort by repeated transmission of circulars to the banks of the dis
trict and by advertising in the newspapers to induce holders of the
earlier issues to convert within tho time prescribed by the Secretary
of the Treasury, which terminated on November 9, 1918. The
following is a statement of the conversions to December 31, a small
number of items still remaining unadjusted:
Converted from one interest rate to another:
First 3£ per cent bonds to 4 per cent (Nov. , 1017-May 15, 1918). $113, 385, 650
Number of deliveries, pieces.......................................................
737, 852
$ , 806, 600
First. 3 per cent l onds to 4} per cent.........................................
A
First 4 per cent bonds to 4{ per cent................. *........................
$74,117, 750
Number of deliveries, including deliveries made on converting
first 34 per cent to 4^ per cent, pieces......................................
262,173
Second 4 per cent bonds to 4£ per cent........................................ $1,045,931,500
Number of deliveries, pieces.......................................................
, 596, 990
Aggregate number of pieces handled, incoming and outgoing.......
4, 098, 205

Special provision was made for converting bonds without delay for
owners who called in person. The largest number of such applica
tions received in any one day was 2,161. In the last eleven days of the
conversion period approximately 25 per cent of the total number of
conversions handled in this way were made.
G O V E R N M E N T D E P O SIT S.

The depositing of the proceeds of sales of Liberty loans and cer
tificates of indebtedness was undertaken in accordance with law
at the request of the Secretary of the Treasury. Depositaries were
appointed by the Federal Reserve Bank, which had the responsibility
of receiving and approving collateral, depositing and withdrawing
funds and collecting interest on deposits, all under the instruction
and supervision of the Treasury Department. The duly qualified
depositary banks were permitted under the law to pay for certificates
of indebtedness and Liberty bonds by opening book credits in favor
o the Treasury. Because a large proportion of the deposits were
created in this way possible disturbances to the money market were
reduced to a minimum.

AN NU AL REPORT OF FEDERAL RESERVE BANK OF N EW YORK.

The withdrawal of deposits from depositary banks, created by the
opening of credits resulting from the sale of Liberty bonds or cer
tificates of indebtedness, has been uniformly made on instructions
from the Treasury Department on a pro rata basis which has been the
same for all banks in the district, and a notice of 48 hours has been
given whenever possible. In order to assist in stabilizing the money
market, funds transferred by the Treasury Department from other
Federal Reserve Banks to the Federal Reserve Bank of New York
in excess of the amounts needed for immediate disbursement have
on several occasions been redeposited at interest with qualified
depositaries in New York City, subject to withdrawal without notice,
and as far as possible have been placed in banks to which disburse
ments for account of loans to foreign Governments were likely soon
to be made.
In order to minimize disturbances due to the withdrawal of funds
representing payments of income and excess profit taxes during
June, 1918, arrangements were made whereby the seven collectors
of internal revenue in the district deposited their receipts of cash,
checks, and certificates of indebtedness with this bank and all checks
on banks which had been designated United States depositaries Were
forwarded to such banks for credit in the “ war loan deposit account”
of the Government, subject to withdrawal gradually in accordancewith the Government’s requirements. The number of such checks
received was about 300,000, aggregating about $600,000,000.
During the first loan 306 banks qualified as depositaries; in the
second 533, in the third 801, and in the fourth 867. In order to
facilitate the pledging of collateral, local custodians were appointed
in 49 cities, but the number was later reduced to 36.
The Government deposit division of the Federal Reserve Bank,
with a personnel of 63 employees, administered this function. The
following shows the magnitude of the deposits and the volume of
securities pledged against them:
LIBERTY LOAN FUNDS.

Third loan, largest amount on deposit, May 14................................ $517, 537, 883.00
Fourth loan, largest amount on deposit, Nov. 4............................... 609,182, 509. 63
CERTIFICATES OF INDEBTEDNESS FUNDS.

Third loan, largest amount on deposit, Apr. 4..................................
Fourth loan, largest amount on deposit, July ..............................

1
0

3<0, 500,
496, 300,

000
0. 0
00 0
0.0

SECURITIES IN VAULT.

Third loan, largest amount, May ] .................................................
Fourth loan, largest amount, Oct. 26................................................

'54, 230,106. 65
'51, 633, 510.49

SECURITIES WITH CUSTODIANS.

Third loan, largest amount, June 18.................................................
Fourth loan, largest amount, Oct . 26................................................

8
8

379, 241, 241.
309, 849, 331.41

ANNUAL REPORT OF FEDERAL RESERVE BANK OF N EW YORK.
GO VER N M EN T D IS B U R S E M E N T S .

Prior to America’s entry into the war the only function under
taken by the Federal Reserve Bank as fiscal agent for the Treasury
Department was the payment of Government checks. With the
coming of war this work has increased manyfold. Checks are of all
sorts and sizes, varying from checks of less than $1 for interest on $50
registered bonds to Treasury drafts for large sums on war contracts.
The growing volume of work handled in this department has neces
sitated the employment of an increasing number of clerks. The
following table shows the number of checks handled each month,
their amount and the average number of employees:
Number of
checks
handled.

Januarv......................................................................................
February...........................................................................................

September............................................................................
October..............................................................................
November.........................................................................
December.............................................................................
Total.........................................................................

Amount.

513,383
583,719
689,958
729,716
901,319
975,381
1,023,146
1,063 603
1*066*270
1 128* 706
*
1 il/l j U
101*626
aU
1 OOlj 1S4
■) 331 l^ri
L

$217,659,000
209.917.000
298.885.000
356.249.000
377,466,000
389 225 000
425^ 430* 000
561 * U Vj vvU
ftfiO 000
U
413 990 000
si k*VUPy Uvv
Oltjf qqq’ 000
£^2
vwj U 1j non
O vV /
A
filft 472 Uw
000
UlUj

11,107,981

Average
number
of em
ployees.
15
15
20
20
20
25
25
30
30
35
40
40

4,936,592,000

The record day was December 26, when 102,175 checks were
handled.
The payments of the Treasury through this bank, since April 1,
1917, exclusive of maturing certificates and coupons, have included
$7,400,000,000 of advances to foreign governments and $5 ,9 0 0 ,0 0 0 ,0 0 0
in miscellaneous Treasury checks, aggregating $13,300,000,000 in all,
or about one-half of the entire Treasury payments, exclusive of cer
tificates and coupons, during the 21 months.
EXPENSES OF LOANS.

The cost of conducting the two campaigns of 1918, of maintaining
the regular sales and publicity organizations of the Liberty loan, and
of carrying on the fiscal agency operations of the Federal Reserve
Bank, in so far as they relate to the third and fourth Liberty loans,
amounted on December 31 to $4,244,822.12. The detailed figures,
as reported by the comptroller of the Liberty loan organization, are
shown in Schedule 12. The cost of operating the two partial pay
ment p ans are included in the figures for the distribution organizar 0^ ^ iL t m°Unt t0 date f°r the third and fourth loans>respectively,
to 1460,076.18 and $205,817.21.

A N N U A L REPORT OF FEDERAL RESERVE BA N K OF N E W YORK.

NEW GOVERNMENT LOAN ORGANIZATION.

At the dose of the year, following instructions from the Secretary
of the Treasury, arrangements were made to consolidate the work of
the Liberty loan committee and the war savings organizations
within the district under the control of the governor of the Federal
Reserve Bank of New York as a unified Government loan organization.
The war savings staff lias been incorporated with the headquarters
departments of the Liberty loan committee with a prospect of
material reduction in administration costs, and with the expectation
of coordinating the activities of the two committees more closely
together than heretofore. The consolidated organization will have as
its head a director of Government loan organization for the district
with several vice directors. The operations of the new organization
begin on January 1, 1919.
WAR SAVINGS AND THRIFT STAMPS.

From December 7, 1917, to December 31, 1918, the Federal Re
serve Bank of New York sold war savings and thrift stamps as
follows:
War
savings
stamps
(pieces)*

Thrift.
stamps
(pieces).

2,043,486
929,208
335,305
11,394
5,000
12

Total............

10,992,771
2,682,448
2,570,566
31,734

3,324,405

Greater New York
New York S ta te ..
New Jersey............
Connecticut..........
Philippine Islands.
H aiti.................

16,277,719

200

STABILIZATION OF THE MONEY MARKET.

Before the close of the first Liberty loan campaign, in May, 1917, it
became apparent to the officers of the Federal Reserve Bank and to
the members of the Liberty loan committee that steps must be taken
to stabilize interest rates in the stock exchange loan market in order
that rates on such loans might not reach such levels as to embarrass
the Treasury. The natural result of the increasing volume of Gov
ernment borrowing from New York City and interior banks was the
calling of loans secured by stock exchange collateral, a tendency which
was increased by the desire of the banks of the country to accumulate
larger amounts of paper available for discount at the Federal Reserve
Bank.
For some months the institutions represented on the Liberty loan
committee undertook from day to day to find the large amounts of
money required to be loaned on the exchange in order to avoid dis
turbed conditions.

ANNUAL REPORT OF FEDERAL RESERVE BA N K OF N E W YORK.

By September, 1917, however, the amount had become too large
for these institutions to assume without injustice to themselves and
to their customers, and a subcommittee of the Liberty loan com
mittee was appointed, with the governor of the Federal Reserve
Bank as chairman, for the purpose of effecting a more equitable
distribution of the loans and devising plans for providing the funds
required for the needs of the stock exchange.
Under the general supervision of the Federal Reserve Bank this
so-called umoney committee” perfected an organization of 63 of
the banks and trust companies in New York City which agreeed to
place at the committee’s disposal a fund to be used when necessary
in making loans on stock exchange collateral, the participation of
each institution being determined according to its assets. This
arrangement, undertaken at first in consultation with the Secretary
of the Treasury, has been renewed from time to time at his request.
As experience was obtained changes were effected in the plan of
participation, and an arrangement was finally reached which reap
portioned among the participating banks, on the basis of their assets,
the aggregate volume of stock exchange call loans which they were
then carrying in the aggregate and provided for an additional loaning
fund of $200,000,000 to be used when necessary.
In October owing to military and political developments it became
evident that a large speculation in securities was developing, notwith
standing the fact that the fourth Liberty loan was in course of being
placed and the Government requirements for credit w
^ere at a maxi
mum. Under these circumstances the committee felt it necessary
to adopt some positive measures of restriction and arranged with the
banks participating in the fund to increase the margins required for
stock exchange loans from the customary minimum of 20 per cent to
a minimum of 30 per cent. At the same time, by arrangement with
the officers and a committee of the stock exchange, to which all
members of the exchange were reporting the total amount of their
boiTowings, such reports were made available to the money commit
tee. During this period the demands upon the additional loaning
fund were very heavy, due primarily to the calling of loans by outof-town institutions and by local lenders not in the group of partici
pant banks.
Upon the representation of the committee of the stock exchange
that the continued enforcement of the requirements for additional
margin might work hardship and in some cases even injustice, the
arrangement was withdrawn on December 5 upon the assurance of the
committee that the exchange would take steps to prevent any con
siderable increase in the total of the loan account of its members.
The activities of the money committee were undertaken solely to
insure the Government against developments in the money market

A N N U A L REPORT OF FEDERAL RESERVE B A N K

O NEW
F

YORK.

in New York which would in any way militate against the success of
its borrowing program. Its aims may be summarized as follows: ’
First. To maintain a free market for securities and thereby protect
the investment situation and the integrity of a great volume of bank
loans made upon stock-exchange collateral.
Second. To prevent high rates and wide fluctuations in the money
market.
Third. To prevent an increase in the total amount of credit em
ployed in stock-exchange transactions.
The records indicate that the work was successfully done after the
formation of the committee. The rates for call loans on stockexchange collateral, set forth in" full on page 376, have ranged prin
cipally between 4 per cent and 6 per cent, never exceeding the
latter figure; a free market for securities has been maintained and
the amount of stock-exchange loans has been held within reasonable
bounds. It seems clear that if some agency of this character had
not been functioning the Government’s financial plans might have
been seriously embarrassed. The New York banking institutions
participating in the arrangement, as well as the officers and members
of the stock exchange, have at all times accorded the money com
mittee their support and evidenced their readiness to cooperate in
rendering this important assistance to Government finance; while
the members of the money committee undertook a difficult and
responsible piece of work in a most public-spirited manner, and in
carrying it out gave generously of their time and consideration.
CAPITAL ISSUES COMMITTEE.

On January 11, 1918, the Secretary of the Treasury requested the
Federal Reserve Board, “ pending action by Congress/' to pass upon
capital expenditures and issues of new securities from the standpoint
of their necessity as compared with the Government's large needs
of capital, labor, material, and transportation facilities. The Board
accordingly appointed from its membership a Capital Issues Com
mittee, which secured the assistance of an advisory committee of
bankers and caused subcommittees to be organized in each of the
Federal Reserve districts.
In the War Finance Corporation Act, approved April 5, 1918,
Congress sanctioned by law the continuance of the w
^ork of the
committee, and pursuant to that act the President appointed a
permanent Capital Issues Committee, which in turn appointed per
manent district committees in each of the Federal Reserve districts.
The district committee for the Second Federal Reserve District,
of which, as in other districts, the chairman of the Federal Reserve
Bank was chairman and the governor vice chairman, consisted of
30 bankers, manufacturers, officers of public utilities, and others.

ANNUAL REPORT OF FEDERAL RESERVE BAN K OF N E W YORK.

It held regular meetings, usually twice and sometimes three times
weekly, usually lasting from three to five hours and attended by five
or more members, in rotation, from the date of its organization until
December 31, 1918, when by vote of the central committee, and with
the concurrence of the Secretary of the Treasury, the active work of
the committee was discontinued.
Nine hundred and seventy-two applications, totaling $2,069,613,048.66, have been formally considered by the district committee,
and in the majority of cases hearings were granted to applicants.
With respect to 181 of these applications the district committee
took final jurisdiction. Detailed reports were rendered to the
Capital Issues Committee at Washington with respect to 791 appli
cations, aggregating $1,875,123,043.80. Out of this total the dis
trict committee recommended approval of applications aggregating
$1,775,343,629.80, and recommended disapproval of $99,779,414.
The action of the central committee with respect to these applica
tions was as follows: It approved $1,722,404,611.50 and disapproved
$119,368,795.25, and on or about December 31, 1918, when the com
mittee discontinued its operations, it dismissed applications still
pending aggregating $33,349,637.05.
The various matters considered by the district committee have
covered every variety of security issue, including issues by States,
counties, and municipalities, by public utility companies, by indus
trial corporations, by banks, insurance and trust companies, by
syndicates and membership associations. Inasmuch as the funda
mental purpose of the committee was to conserve capital, labor,
materials, and transportation facilities for purposes contributing
directly to the prosecution of the war, the district committee asked
for and obtained from practically all public and private organiza
tions within the Second Federal Reserve District statements of
their construction programs prior to the letting of contracts for
such programs. By this means much construction work which
would ultimately have led to the issuance of securities was deferred,
labor and materials have been released for war purposes, and the
investment market has been relieved of the necessity of absorbing
large amounts of securities.
This committee has also obtained reports on private construc
tion as well as on public construction to be paid for by taxation
or assessment, as distinguished from the sale of securities. In this
connection the district committee reviewed the tax budgets of all
municipalities in the Federal Reserve District which had been pre
pared prior to the signing of the armistice. It also followed up all
a vertised construction of churches, clubs, private residences, etc.,
prior to the date when machinery was instituted by the War Indus
tries Board requiring the licensing of all nonwar construction costing
more than $2,500.

A N N U A L REPORT OF FEDERAL RESERVE B A N K OF N E W YORK.

The committee’s usefulness should not be measured only by the
applications formally presented to it and approved or disapproved
by it, since the mere fact of the committee’s existence in itself con
stituted a strong restraint upon the issuance of new securities, and
few, if any, applications were presented to the committee except by
those who believed that their applications would be approved.
The members of the committee gave most generously of their time
and enjoyed the heartiest cooperation from public and private
officials, from bankers, investment houses, lawyers, manufacturers,
and merchants, as well as from the Investment Bankers’ Association,
the American Bankers’ Association, the New York Stock Exchange,
and the New York Curb Market Association. Without the coopera
tion of these individuals and associations the work of the committee
would have been almost impossible.
F i n a n c ia l C o n d it io n s .
BANKING IN THE SECOND FEDERAL RESERVE DISTRICT.

The chart on the following page shows certain significant figures
from the weekly reports of 107 banks in this district, being all the
member banks in New York City, Brooklyn, Buffalo, Rochester,
Newark, Albany, and Syracuse, N. Y.; Jersey City, N. J.; and Bridge
port, Conn. This chart probably gives the best picture obtainable
of banking conditions in this district throughout the year. With the
exception of January and February when the reports did not distin
guish between Government bonds and certificates of indebtedness,
the chart shows, week by week, the volume of (a) United States
bonds owned, (b) certificates of indebtedness owned; (c) loans secured
by United States obligations; (d) all other loans and deposits. The
dotted line (e) indicates the volume of Government deposits in the
reporting banks throughout the year.
It will be noted that the volume of “ other loans and investments”
was almost exactly the same at the beginning of the year as at the
end; namely, $4,100,000,000. In fact the volume actually decreased
somewhat, as 11 institutions with resources of about $350,000,000
were added to the list of reporting banks during the year. The
expansion is entirely in Government securities and loans thereon.
The Government bonds owned rose substantially at the close of
both the third and fourth loan campaigns, with a tendency to de
crease slightly thereafter. The certificates of indebtedness show
the usual increases before bond sales and decreases thereafter; the
volume of loans on Liberty bonds was fairly steady up to the close
of the fourth loan campaign, when it increased sharply, indicating
clearly the heavy borrowing which had to be resorted to in order to
subscribe the quota assigned to this Federal reserve district.

ANNUAL REPORT OF FEDERAL RESERVE BA N K OF N E W YORK,

C A S IC T N O LO N A D 'NVESTW NTS'
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REPORTING M BER BANKS, SECOND FEDERAL RESERVE DISTRICT
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A N N U A L REPORT OF FEDERAL RESERVE B A N K OF N E W YORK.

In the following chart the two upper lines show the movements of
the loans and deposits of New York Clearing House banks, while the
lower line shows the course of the loans and investments of the
Federal Reserve Bank. The close relationship of the two is quite
apparent.
Government financing and the resulting expansion of banking
figures are so clearly portrayed in these two charts and have so com
pletely overshadowed all other banking developments as to make
further comment unnecessary.
The action of the New York Clearing House, however, in fixing
maximum rates of interest on deposits was a step of such importance
toward sounder banking that the extension of similar control to
other communities in the district is much to be desired.
The high interest rates prevailing in many parts of this district
are a constant element of danger in our banking situation. Often
the banks and trust companies, paying such rates, have felt impelled
to invest largely in bonds of high yield. The depreciation in the
market value of these securities has been so heavy during the past
two years that it is believed that the institutions in which high
interest rates prevail may be more ready now than in the past for a
reconsideration of this whole subject. It is hoped that some sub
stantial progress in this direction may be made during 1919.
GENERAL BUSINESS CONDITIONS.

During January and February business and industry in this dis
trict were hampered seriously by congestion in railroad transporta
tion and acute fuel shortage, a condition which was aggravated by
extremely severe weather. Conditions improved in March, traffic
began to move more freely, production increased, and, until October,
industry was at its maximum capacity, with civilian needs more and
more subordinated to the requirements of war. A steadily increas
ing proportion of manufacturing capacity was utilized for the pro
duction of war supplies, and Government supervision over industry
was constantly increased, especially through control of raw materials
and transportation. Of basic materials, such as iron and copper, only
a very small percentage was available for other than war needs. In
the textile trade, with almost no wool available for manufacture for
civilian use, approximately 50 per cent of knit goods, 75 per cent
of denim, and 100 per cent of cotton duck were being applied to
war purposes. In every line, similar developments occurred to a
greater or lesser extent.

ANNUAL REPORT OP FEDERAL RESERVE B AN K OF N E W YORK,

A N N U A L REPORT OF FEDERAL RESERVE B A N K OF N E W YORK.

An influenza epidemic swept over the district in October, keeping
many people from work and slowing up business in general. This
was fairly well checked by November, and business was proceeding
at top speed with most of the necessary adjustments to war condi
tions effected when, on November 11, the armistice was signed.
Then followed a period of uncertainty and hesitation with regard to
the steps necessary to readjust business to a peace basis. Gradually
Government restrictions, such as priority rules, were removed, and
many lines were able promptly to return to approximately their
prewar bases. Many other industries, however, felt obliged to
pursue a waiting policy pending announcement of the Government’s
program for cancellations and the disposal of Government-owned
stocks of raw materials. While the general attitude at the close of
the year is one of caution, with buying limited to immediate require
ments, jobbers and merchants are inclined to cooperate in effecting
a gradual rather than a sudden decline in prices, and many manufac
turers are disposed to retain their labor in spite of lessened output.
Prices, as indicated by Bradstreet's commodity index, rose from
$17.5996 on December 1, 1917, to $19.0376 on December 1, 1918, an
increase of 8 per cent, indicating the decline in the purchasing power
of the dollar during the period.
LABOR.

During the first 10 months of 1918 all lines of business and industry
experienced great difficulty in obtaining and holding a sufficient
supply of labor. The great scarcity of both skilled and unskilled
labor led to high competitive wage offers, resulting in a large turn
over. The increasing flow of women into industry helped somewhat
to supply the demand, but the shortage, nevertheless, was great.
The “ work or fight’ *order in July and Federal supervision of employ*
ment of unskilled labor helped the situation to some extent, but by
the time these measures had become really effective matters were
made worse again by the October influenza epidemic and the prospec
tive operation of the enlarged draft law.
Very soon after the armistice was signed the labor shortage practi
cally disappeared. Here and there unemployment became notice
able, especially where cancellation of Government contracts resulted
in closing down important plants. Unemployment was evidently
on the increase throughout the month of December, and some unrest
was apparent.
Reports of the New York State Department of Labor, based on
returns from 1,648 representative firms employing one-third of the
factory workers in New York State, show that while the number of
employees decreased 1 per cent during the year ending November,
1918, aggregate wages increased 21 per cent, and that for the two-year

ANNUAL REPORT OF FEDERAL RESERVE B A N K OF N E W YORK.

period ending November, 1918, aggregate wages increasd 43 per
cent, while the number of employees increased only 6 per cent.
INDUSTRIES AND STAPLES.

Although limited during the winter by bad traffic, fuel, and weather
conditions, and throughout the year by labor scarcity, the more
essential industries in general operated at their maximum capacity
up to the armistice. Less essential production was curtailed to a
considerable extent, but such plants were often able to produce
essential articles. The building trades were quieter than for many
years, little construction other than necessary alteration and repairs
being done, except for the Government or war industries.
Steel production lagged somewhat through the first months of the
year, due to the bitter weather and the fuel shortage. After that
it began to approach the standard set in 1917 and gained an impetus
which continued till well toward the end of the year. The present
situation in the steel industry, however, is in marked contrast with
that of a year ago. Then every effort was being made to meet war
requirements; now the Government has practically retired from the
market and steel makers face the necessity of readjusting to a peace
basis, with great dullness in the building trades and the expected
foreign demand not yet materializing. Maximum price-fixing by the
Government was stopped January 1, 1919; before that time steel
producers had made a reduction which averaged about $4 a ton on
the various grades quoted, yet prices were still about $30 above those
of 1907, the highest of recent prewar years. Pig-iron production
during 1918 is estimated at 38,506,249 tons, which is slightly above
that of 1917, and ingot production at 42,212,000 tons, which is sub
stantially above that of 1917.
For a variety of reasons the stock of copper in process was large at
the end of 1916, despite the heavy demand throughout the year.
The price was lowered from 26 cents to 23 cents in December, and at
the close of the year to 20 cents, though these prices were really
nominal and trading was at a standstill.
Cotton prices fluctuated widely during 1918, ranging from 23 cents
to 37.5 cents, the spot price at the year's end being 32.6 cents. The
crop was larger than that of either 1917 or 1916. Mills worked at
full capacity, largely on Government orders, and netted profits in
excess of expectations.
Woolen mill output was taken almost exclusively for Government
purposes until toward the end of November. A decided fall in prices
of woolen goods occurred during December.
The country’s wheat production for 1918 was 917,000,000 bushels,
as against 636,600,000 bushels in 1917, and the Government's guar
anteed pnce of $2.28 per bushel, which is to continue up to June,

A N N U A L REPORT OF FEDERAL, RESERVE B A N K OF N E W YORK.

1920, gave to the crop an extraordinarily high value. Corn pro
duction, on the other hand, was 2,582,814,000 bushels, as against
3,000,000,000 bushels in 1917, and prices rose from $1,279 per bushel
to $1,366. Other grains, with the exception1of barley and rye,
showed similar price tendencies.
LOCAL CROPS.

The total value of farm products, including milk, in New York
State is estimated at $801,840,360 for 1918, as compared with
$659,787,980 for 1917. In many crops the actual yield increased as
well as the value. The wheat crop, valued at $18,900,000, showed
a production of 9,000,000 bushels as compared with 8,286,000 bushels
in 1917. In corn the increase was nearly 10,000,000 bushels, the
production being 30,852,000 bushels, valued at $55,065,000. Other
crops showing a substantial increase in actual yield over 1917 were
oats, onions, and cabbage. Buckwheat, rye, potatoes, beans,
peaches, and grapes showed a decrease as compared with 1917, while
hay decreased in tonnage but increased $14,000,000 in value.
Similar data for northern New Jersey are not available.
MERCHANDISING.

Merchandising was fairly active throughout the year. During
the first ten months, retail sales of less essential articles were con
siderably curtailed due to war conditions, while demand for staples
continued strong. The influenza epidemic caused a very excessive
slackening in business during October. Following the signing of the
armistice, retail sales increased decidedly in nearly all lines, due
partly to the decrease of influenza, but principally to the relaxation
of the rigid economies practiced during the war. The result was a
holiday trade of record proportions. Up to the time of the armistice
the purchases of jobbers and retailers seemed limited only by ina
bility to obtain supplies. With the certainty of peace, however,
buying became extremely conservative because of large stocks on
hand and the belief that declining prices were to be anticipated.
MONEY RATES.

Money rates averaged firmer throughout the year than during 1917.
During the first half of the year the call loan rate was subject to
frequent fluctuations, ranging between 4 per cent and 6 per cent
from January to August. From the middle of August until the
beginning of November it remained steadily at 6 per cent and was
only prevented from going higher by the cooperation of the money
committee and its associated banks. After the armistice the rate
fluctuated, declining to 4 per cent at times, but returning to 6 per
cent at the close of the year.
116015-19------5

ANNUAL REPORT OF FEDERAL RESERVE B A N K OF N E W YORK.

Rates on time loans secured by stock exchange collateral were
somewhat nominal as demands for loans of this kind exceeded supply
during most of the year. The rates quoted in January were 5f per
cent to 6 per cent Tor two to four months7 maturities; from late
February to the middle of April 6 per cent#was the uniform quotation.
A slightly easier tendency then set in, which continued through
August, carrying rates as low as
per cent to 6 per cent. Rates
thenjrose again to 6 perlcent and continued so until the last week of

December, when distinctly easier conditions prevailed which carried
rates down to 5J per cent to 5J per cent.
The rate on commercial paper was consistently higher than during
1917, ranging from 5^ per cent to 6 per cent throughout the year.
The rates on bankers7 acceptances have already been referred to.
The chart above shows the rates on call money and commercial
paper during the years 1917 and 1918.

A N N U A L REPORT OF FEDERAL RESERVE B A N K OF N E W YORK.
THE

S E C U R IT IE S

M ARKET.

Following a sharp upward turn in stock prices in the closing week
of 1917, a fairly continuous rise continued throughout 1918, reach
ing its high point about the middle of November, since which time
prices have showed a declining tendency, although they retained at
the end of the year a very substantial gain from the low point of
December a year ago. In May and November there was trading
in very heavy volume and indication of a strong upward movement.
These movements, however, were not long continued, and the
general course of the market has been a moderate upward rise with
trading for the most part in moderate volume, the total number
of shares of stock sold during the year being approximately
141,000,000, as against 184,000,000 in 1917.
* Unlike stock prices, prices of bonds listed on the exchange showed
a declining tendency from January to April, a rather marked rise
during May, followed by a further downward movement until the
end of September, when apparently because of increased certainty
of early victory for the allies, prices began a strong upward move
ment which continued well into November. Though there was a
slight fall between that date and the end of the year, the level reached
was over three points above that of January, and about six points
above the low point reached in December, 1917. Over four-fifths
of the total volume of bond sales consisted of Liberty bonds.
With the improvement in bond prices toward the end of the year
it became possible in a limited way for railroad and other corporations
with good credit to place bond issues of fairly long maturity, instead
of borrowing on short term issues. Several important issues were
offered and oversubscribed during the closing weeks of the year.
The charts on the following page, reproduced from 1‘The Annalist/'
show the movement of average prices for 50 stocks, half industrials
and half railroads, and the trend of bond prices during 1917 and 1918.
Following are figures, also taken from “ The Annalist,” showing the
volume of stock and bond sales, by months, during the year.
Shares.

January
February
March

August
September
October
November . *
Total

................ *..............*
* .................... .......................
...................... ................... *

...............................
........... .................... .........
...............*..................*
......................................... *.........
...............................................

Government
bonds.

Total all bonds
(including
Government).

13,504,774
11,316,152
8,207,918
7,436,714
21,104,078
11,598,715
8,347,851
6,864,812
8,030,449
20,285,334
14,720,163
11,961,135

$73,928,500
61,281,500
99,552,500
110,783,000
135,966,500
120,382,000
102,688,500
147,339,000
156,175,000
176,390,500
202,558,500
310,056,000

$107,265,000
84,708,500
119,636,000
128,271,500
166,478,000
143,519,000
120,489,000
167,288,500
179,696,500
233,984,500
256,211,000
385,711,000

143,378,095

1,697,041,500

2,093,257,500

ANNUAL REPORT OF FEDERAL RESERVE B A N K OF N E W YORK*

The Tread of Bond Price*—Average of 40 Listed Issues
1

rftfc
,
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L

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--75

L iJ

The Movement of Stock Market Averages

A N N U A L REPORT OF FEDERAL RESERVE B A N K OF N E W YORK.

FOREIGN TRADE.

Total exports from the United States during 1918 are estimated
■ t $6,100,000,000, a decrease of about $100,000,000 from the pre
a
ceding year ; while imports are estimated at $3,100,000,000, an increase
of about $100,000,000 over 1917. Exports from this customs dis
trict, excluding Government shipments, aggregated $3,834,677,239,
a decrease of $432,727,353 from 1917, and imports were $1,296,345,823, a decrease of $66,081,165. If exports carried on Government
vessels, which did not clear at, or report to the customs house,
were included, exports through this port would doubtless exceed
those of 1917.
New York’s decrease in foreign trade was shared with other ports
on the Atlantic coast, this whole division showing a decrease of
14 per cent in exports and 7 per cent in imports, while the Pacific
coast gained 70 per cent in exports and 30 per cent in imports.
This shifting in trade is the result of the slight decrease in exports
to Europe, other than Government exports, coupled with the de
cided decrease in imports from that continent and on the other
hand, of the large gain in both exports to and imports from Asia
and Oceania. Total imports from Europe are estimated at $350,000,000, compared with $550,000,000 in 1917 and $900,000,000 in
1912, a representative prewar year. Imports from Asia are esti
mated at $900,000,000 against $758,000,000 in 1917 and from Oceania
$165,000,000 against $100,000,000 in 1917. Exports to Asia are
estimated at $450,000,000 as compared with $430,000,000 in 1917
and to Oceania $150,000,000 as compared with $117,000,000 in
1917. There was little change in the amount of either exports to
or imports from South America as a whole. Imports from Mexico
increased about 12 per cent while exports decreased slightly. There
was a considerable increase in trade with Canada.
Our excess of exports over imports during the European war
totaled about .$11,000,000,000.

ANNUAL REPORT OF FEDERAL RESERVE BANK OF N E W YORK.

E x h i b i t A . — Movement

o f principal earning assets o f the Federal Reserve Bank o f New
Yorh during the calendar year 1918.
[In thousands of dollars; i. e,, 000 omitted.]

^ ....
(1)

(2)

|Piscounti ed paper
Other
■ secured
: by United discount
|States war ed paper.
| obligaj tions.
Jan. 4................................. ! 150,325
11
.....152,525
.....157,625
18
25.....................................152,421
Feb. 1................................ .....138,450
S................................ .....117,450
15...............................
97,488
21....................................110,008
Mar. 1................................ .....129,739 ■
8................................ .....137,025 :
15....................................144,570 .
22....................................161,618
28-29...............................162,968 I
Apr. A................................ !.... 160.427 !
1 2
j.... 288; 119,
1 9
i.... 356,477 !
„
26...............................• 379,846 ,
M ays................................
348,867 !
10...............................
373,301
.
304,298
17
34...............................■ 380,004
.
31...............................:
340,803
June 7........................... .
395,970
H...............................
399,341
2 1
i
306,311
, . » ...............................
165,469
July*.................................
237,382
12
280,342
1®............................... j
261,718
...............................1 272,185
,
A«*-2.................................,
264,326
?■...............................« 285,454
16...............................:
315,593
23................................
405,029
. » ................................
415,221
Sept- «.................................
453,900
13
487,811
2 .............................. • 524,966
„ , » .............................. !
564,288
Oct. 4 .................................
546,522
J0-11..........................
589,817
1 8
547,420
v
2?............................... !
476,068
514,153
Nov. 1................................
? * * "...........................
574,655
15...............................i
580,548
22
!
555,534
t
.
® ...............................j
626,905
Dec- 6 - ...............................1 669,840
...............................j
624,953
2 ............................... !
o34,748
27...............................:
610,770

92,293
79,905
69,689
70,199
77,079
59,787
63,918
67,322
88,062
86,271
96,576
87,662
84,949
74,086
58,388
52,895
54,410
52,225
76,723
64,416
62,171
67,472
66,129
69,194
76,992
93,796
124,640
132,659
147,452
124,210
104,832
127,001
126,472
147,380
146,418
130,199
134,034
132,421
113,074
99,157
106,391
96,543
104,749
110,459
103,678
94,444
95,312
84,263
83,704
73,314
54,114
41,605

(3)

(4)

(1 2
+)

i0 gt
b Uh
inopen

Bills

152,377
150.982
155,570
168,278
177,407
166,237
170,760
176,737
165,545
178.256
182,116
179,905
130,887
127,743
123,108
117,406
121,027
124,463
126,650
130,439
138.983
133,420
130,580
127,966
123,458
115,S13
112,416
113.256
104,561
104,033
116,722
113,106
112,692
125,276
121,875
120,762
123,016
131,978
155,575
112,506
118,702
127,040
142,156
129,944
134,045
166,938
172,204
166,732
107,883
99,521
84,491

(7)

Total bills
discount- ! Per cent 1 Total
edand i (1+5) 1
bought. ;
; assets-

market.

242,618
232,430
227,314
222,620
215,529
177,237
161,396
177,330
217,801
223,296
241,146
249,280
247,917
234,513
346,507
409,372
434,256
401,092
; 450,024
i 368,714
! 442,175
; 408,275
| 462.099
468,535
- 383,303
259,265
' 362,022
t 413,001
i 409,170
i 396,395
I 369,158
412,455
442,065
552,409
561,639
584.099
621.845
657,387
677,362
645,679
606,208
643,963
580,817
624,612
678,333
674,992
650.846
711,168
753,544
698,267 I
588,862 I
652,375 I

(6
)

(5)

1
:
i

394,995
383,412
382,884
390,898
392.936
343,474
332,156
354,067
383,346
401,552
423,262
429.185
378,804
362.256
469,615
526,778
555,283
525.555
576,674
499,153
581,158
541,695
592,679
596,501
506,761
375,078
474,438
526.257
513,731
500,428
485,880
525,561
554,757
677,685
683,514
704.861
744.861
789,365
832.937
758.185
814,910
771,003
722,973
754.556
812,378
841.930
823,050
877,900
861,427
797,788
673,353
721,698

'
I
;
:
I
j
.
■
i
:
1
i
|

:
,
:
'
;
j
i
'
:
:
1

38.1
39.8
41.2
39.0
35.2
34.2
29.3
31.1
33.8
34.1
34.2
37.7
43.0
44.3
61.4
67.7
68.4
66.4
64.7
61.0
65.4
62.9
66.8
66.9
60.4
44.1

50.0
53.3
50.9
54.4
54.4
54.3
56.9
59.8
60.7
64.4
65.5
66.5
67.7
72.1
72.4
71.0
65.8
68.1
70.7
69.0
67.5
71.4
77.8
78.3
79.4
84.6

;
j
!
!
;
i
'
I
i

432,786
457,188
437,696
411,742
407,792
455,671
383,419
471,441
475.894
528,075
565,462
586,637
550,915
547,488
547,627
o32,803
559,196
529,660
655,586
544,20a
5S7,389
621,690
622,776603,324
512,797
574,590
478,623
546,062
518,519
505,584
491.445
530,650
574,996
689,29$
697,404
720,192
764,640
813,092
860.446
785,051
845,594
802,387
937,343
791.894
850,867
880,356
919,007
914,721
901,158
840,973
869,299'
925,424

A N N U A L REPORT OP FEDERAL RESERVE B A N K OF N E W YORK.

I
I
i

i
MOVEMENTOFEARNINGASSETS
i
DURINGTHECALENDAR Y£ARt918.
f
G&
rvelt Jlfa&anJPajier, Girvc2:3oto^ilte£)iscozmtccL.
Gxrye3:J tlL discounted ajid,3ough£.
B s
/
Curve4:joteU,€aj-rix>tgJ?33e£s, utcl- C .GovernjnenfrSBcuri&cs.
f.S
CurPcStjnafro ofWarZoanJhjtcr r\
i
toSfctzd3ills ZHscotatfed,<vt&3ougM. \ R t

FEDERAL RESERVEBANK OFNEWYORK.

s
1
Jo

ANN UAL REPORT OF FEDERAL RESERVE BANK OF N EW YORK.

E x h ib it B .-M o v e m e n t o f cash reserves, net deposits, Federal resene note liabilities
and the resen t percentage o f the Federal Reserve Bank o f New Yorh during the calendar
year 1918.

thousands of dollars; i. e., 000 omitted.]

(1
)

(2
)

Total cash > Net de
posits.
reserves.

Jan. 4...
11..
15..
Feb. 1..
s ..
15.
21.
Mar. t ..
5 ..
15.

■
jo

Apr.

b'.

1.
2

19.
26.
May 3 ..

1.
0

17.
34.
31.
June 7..
14.
21.
28.
July 5 ..
12 .
19.
26.
Aug. 2..
9..
16.
23.
30.
f^pt. 6.
13

2
0

27
Oct. 4 ..
10.
15.
25.
Nov. 1..
8..
15.
22.
29.
Dec, 6 ..
13.
20.
27.

*640,
647,
681,
716,
728,
716,
734,
694,
684,
678,
620,
650,
684,
703,
744,
71i;
711
735,
735,
708,
710,
652,
684,
705,
751,
853,
851,
768.
884,
896,
926,
876,
798,
728,
721,
755,
691,
662,
635,
700,
693,
672,
655,
730,
703,
667,
649,
726
709,

*649,728
689,642
699,814
709,060
715.718
745,540
682,224
716,017
695,370
730.452
699.005
741,594
732,152
739,605
774,289
720,948
742,478
731,063
852,880
717,333
763,313
736.719
749,376
745.005
690,637
837,944
711,714
689,972
768,761
755,235
762,001
740,875
704,423
738,765
726,035
761,648
730.560
740.561
753,465
721,785
762,126
696,141
819,690
746,415
768,139
769,217
805,863
783,288
767,534
784,023
781.452
763,230

(3)

Federal
Reserve
notes in
actual cir
culation.

(4)

(2+3)

Ratio of
cash re
serves to
not de
posits and
Federal
Reserve
note liabil
ities com
bined.

*402,900 *1,052,628
1,084,10S
394.466
1,097,924
398,610
1,106,522
397,462
1.114.651
398,933
1,149,671 I
404,131
1.094.673 |
412.449
1,142,574 i
426,557
1,136,395
441,025
1,182,233 |
451,781
1,160,724 j
461,719
1,211,346 1
469,752
1,209,750 I
477,598
1,224,838
485,233
1,266,065
491,776
1,217,584
496,636
1,243,118
500,640
1,239,623
508,560
1,363,884
511,004
1,225,159
507,826
1,269,655
506,342
1,253,827
517,108
1,286,140
536,764
1,282,923
537,918
1,237,344
546,707
1.400.792
562,848
:
1,303,505
591,791
|
1,287,979
598,007
i
1.376.651
607,890
!
1.375.674
•
620,439
1,390,403
628,402
;
1.379.792
638,917
1,345,302
!
640,879
1,388,415
649.650
1,385,801
659,766
1,439,946
678,298
1,416,959
686,399
1
1,433,644
i
693,083
1,453,115
699.650
1,441,102
I
719,317
1,489,510
!
727,384
1,425,000
!
728,859
1,541,629
721,939
1,468,482
I
722,067
1,498,622
730,483
1,492,572
J
723,355
1,524,647
718,784
1,503,582
720,294
!
1,489,078
721,544
1,502,541
718,518
1,515,517
734,065
1,499,782
736,552

A N N U A L REPORT OF FEDERAL RESERVE B A N K OF N E W YORK.

I
K ■8
§&

FEDERALRESERVEBANKOFNEWYORK.
DEPOSIT AND NOTE LIABILITIES,
ALSO CASH RESERVES,
DURING THE CALENDAR YEAR 1318.
C
urpcI: Jfetfiejwsvts. Curve2: Total CashReserves.
Curved;JlgqregateJ/ctDcjtosiland,fJZJYoteliabilities.
Curr&
4:StcU of CashJleserpcs B Aggregate
xso
o
J/e£ZteftositandJ MJVofe£ujubutfies.
F.

§
I

ANN UAL REPORT OF FEDERAL RESERVE BANK OF N EW YORK.

Shd le1 Balance sheet.
c e u .—
Dec. 31,1918.

Dec. 31, 1917.

$274,392,165.00

! Dec. 31, 1916.

$250,598,565.00

RESOURCES.

Reserves:
Gold with Federal Reserve agent......................
Gold redemption fund for Federal Reserve
notes..................................................................
Gold settlement fund..........................................
Gold bullion.........................................................
Gold coin and certificates....................................
Legal tender notes...............................................
Silver certificates and coin..................................
Total reserves.
Loans and discounts:
Bills discounted for member banks.................
Acceptances purchased.....................................
Rediscounts for other Federal Reserve Banks.
United States bonds..........................................
United States one-year Treasury notes............
United States certificates of indebtedness.......
United States securities held to secure Federal
Reserve bank notes.........................................
Municipal warrants.............................................
Total investments.
Other resources:
Federal Reserve notes and other cash...............
Federal Reserve bank notes................... '..........
Redemption fund Federal Reserve bank notes.
Items in process of collection..............................
Exchanges for clearing house and sundry cash
items..................................................................
Due from foreign banks.......................................
Interest accrued on United States bonds..........
Deferred charges and prepaid expenses.............
Advances made for Treasurer United States,
account expenses Liberty loan and war sav
ings committees................................................
Real estate........................................................
Cost of unissued Federal Reserve notes............
Total other resources.
Total resources...........
Capital:
Capita Ipaid in.
Surplus.............
Profit and loss. „
Total capital fund.
Deposits:
Due to United States Government...................
Due to foreign governments and banks......... !
Due to member banks, reserve balances. .
Due to member banks, uncollected funds........
Due to nonmember banks, deposit account. *.
Due to other Federal Reserve Banks, col
lected funds.
Due to other Federal Reserve Banks, uncoYlected funds.
Cashiers' checks outstanding .
Gross deposits......................
Notes:
Federal Reserve notes outstanding.. . .
Federal Reserve bank notes outstanding.!
Total.
Other liabilities:
Depreciation reserve account...........
Unearned discount and interest.......
Participation certificates Liberty loan bonds *
Reserve for franchise tax......... . ..............
Total other liabilities.
Total liabilities..........

$107,003,765.00

1 ,0 0 0 .0
0 0 ,0 0 0

250.
20,570

00 0
0.0
00 0
0.0

25.000,000.00 :
66,790,455.76 i
79,101,340.83
179,674,646.70 t
43,038,200.00 |
4,531,976.85

5,854,000.00
68.113,616.99
275,130,455.00
31,322,275.00
8,925,743.85

.
j
[
I

159,321, 257.50
11,188, 200.00
4,077, 274.80

672,528,785.14 i

649,944,655.84 1

302,410,497.30

697,341,455.69
77,576,632.94

225,117,913.30
7,071,158.55
148,770,185.44 1
41,457,184.04
25,191,033.66 ............................
5,168,599.64
1,042,550.00
4,493,000.00
1,205,000.00
15,000,000.00 ............................

1,447,700.00
521,000.00
93,374,500.00
34,955,000.00

510,701.32 !

972,311.62

424,251,433.36 !

51,748,204.21

97,048,219.95
751,000.00
1,689,250.00
145,736,177.53

59,752,685.24

13,865, S97. 1
6

48,091,790.20 :

23,077,418. &

36,401.491.78
6,770,374.11
172,878.27
150,194.29

26,429,660.74

2,503,168.21

73,620.28
20,458.22

12,501.88
8.753.52

905,216,288.63 .

3,023,724.56 !
2,317,692.39 j .
294,061,002.88 !

360,350.01
235,598.S6
134,728,564.69

39,703,338.57

1,871,806,076.65 | 1,208,924,653.89 :

20,820,100.00
8,322,040.00

18,695,950.00
649,363.56 j

393,862,040. O
S

11,865,750.00
" "i63,'063.98

29,142,140.00
5,705,629.16
95,976,172.85
706,062,061.27
72,173,899.90
5,382,207.29

11,870,767.74
3,335.930.00
652,791,80$. 26
35,553,478.43
10,317,630.16

3,571,391.94
j
!.
I '237,'907,'354*87
18,552,984.84
.

78,986,137.26

7,610,609.86:

12,373.721.91

6,934,425.41
4,998,919.04

5,156,779.75 i
4,821,683.09 j

2,085,975.49
188,275.81

975,219,452.18

731,458,687.29 I

274,679.704.86

819,015,835.00
33,785,000.00

456,338,565.00 ;

107,003,765.00

852,800,835.00

456,338,565.00

107,003,765.00

505,255.00
1,308,769.90
34 410.00
12,795,214.57

205.880.00
1,348,238.04
227.970.00

149,756.24

14,643,649.47

1,782,068.04

149,756.24

1,871,806,076.65

1,208,924,653.89

,862,040.08

A N N U A L REPORT OF FEDERAL RESERVE B A N K OF N E W YORK.
S c h e d u l e 2 . —Income

75’

and expense statement.
1918

INCOME.

$17,736,260.94
5,411,820.70
1,561,839.17
2,621.23
22,645.93
10,393.07
27,191.89
50,167.06
491,795.99

Total..

$2,455,532.87
1,843,324.87
378,668.40
66,470.41
14.335.50
38,537.54
8,077.03
18,565.29
80,922.53
24.779.51

25,314,735.98

Bills discounted for members..............
Acceptances bought.....................................
United States securities............................. .
Municipal warrants.................................... .
Profit realized on United States bonds. . .
Commissions received................................ .
Profit on bills sold ........................................
Penalties for deficient reserves..................
Service charges.............................................
Sundry p r o f it s ........................................... .

4,929,213.95

22,618.96
1,298,474.26
139,007.62
170,933.02
42.145.52
137,960.30
33,053.49
99,439.80
47,204.28
35,294.48
48.459.52
20,491.24
121,779.43
335,043.65
27,920.93
100,876.18

18,301.61
398,282.81
55,550.91

EXPENSE.

Directors’ fees, outside conferences, and Federal Advisory Council.,
Salaries........................................................................................................
R ent.............................................................................................................
Cost of furniture and equipment............................................................
Repairs and alterations...........................................................................
Stationery and printing...........................................................................
Telephone and telegraph.........................................................................
Postage........................................................................................................
Expressage..................................................................................................
Insurance.....................................................................................................
Employees’ supper allowance, due to late work...................................
Postage and insurance on our Federal Reserve notes returned.........
General expense..........................................................................................
Cost of Federal Reserve notes..................................................................
Cost of Federal Reserve bank note plates..............................................
Assessment for expenses of Federal Reserve B oard.............................
Total...................................................................................................
Net earnings................................................................................................
Net credits to profit and loss during year..............................................
Net debits to profit and loss during year...............................................
Total..........................................................................................................
Deductions D ecem ber31,1918:
Additional transfer to depreciation reserve account — 1299,375.00
Estimated value of buildings now standing on site,
charged off......................................................................... 803,800.00
Dividends paid during 1918:
Jan. 1 to June30 ...................................................................
July 1 to Dec. 31...................................................................

586,271.98
60S, 754.22

Reserve for franchise ta x ................................................................................
Carried to surplus.............................................................................................

329,096.98
343,764.88
50,252.09'

2,680,702.68
2276347033730” !
132,058.91 ;
............................ 1

1,195,249.28
3,733/964.67

22,766,092.21

3,892,673.44

158,708.77

1, 103,175.00

1,195,026.20
12,795,214.57
7,672,676.44

Total.
S c h e d u l e 3 . —Discount

rates.
Open-market
purchases,
bankers’
acceptances.

Months.

January.
February..
March___
April 1-5.
April 6-30.
May.
June..
July.
August.
September..
October___
November..
December.................
Special rate, Apr. 6-Dec. 31.—For rediscounting for member banks, for periods not exceeding 15 days,
eligible paper having a maturity at time of rediscount of more than 15 days, 4 per cent.

ANN UAL REPORT OF FEDERAL RESERVE B AN K OF N E W YORK.
S c h e d u l e 4 .—

Admitted to
membership,
1918.
January.

February.,

March.
April..

May..
June.
July.

August.

September..

October.

November..
December..

State banks admitted to system during 1918

Hank or trust company.

Location.

Resources.

$3,980,809.35
Bloomfield Trust Co........................................ Bloomfield, N. J............. j
1,096,337.04
Trust Company of Fulton County................. Gloversville, N. Y ..........|
Hudson Trust Co............................................. Hoboken, N. J ................| 24,834,270.11
22,716,183.28
Lincoln Trust Co............................................. New York, N. Y .............j
6,354,559.68
Peoples Bank <c Trust Co............................... Passaic, N. J ....................1
f
2,206,055.70
Peoples Bank & Trust Co............................... Westfield, N. J................!
195,244,763.59
Farmers Loan & Trust Co.............................. New York, N. Y .............!
6.178.884.38
Peoples Trust & Guaranty Co........................ Hackensack, N. J ........... 1
928.171.87
The Bank of Hammondsport......................... Hammondsport, N. Y . - j
1.467.624.92
Rutherford Trust Co....................................... Rutherford, N. J .............j
5,142,020.30
Peoples Trust Co.............................................. Binghamton, N. Y ......... :
32,340,202.34
Commercial Trust Co. of New Jersey............ Jersey City, N. J .............!
752,403.25
Trust Co. of Wyoming County....................... Warsaw, N. Y ................. !
1,176,459.86
Glen Ridge Trust Co....................................... Glen Riage, N. J............ ;
3,150,215.03
Ithaca Trust Co................................................ Ithaca, N. Y ....................j
1,923,885.43
Workers Trust Co............................................ Johnson Citv, N. Y ........
2.430.346.92
Nassau County Trust Co................................. Mineola, N. Y ................. j
3,960,638.14
Montclair Trust Co........................................... Montclair, N. J ............... ;
9,365,827.67
Power City Bank............................................. Niagara Falls, N. Y .......
6.956.030.22
Schenectady Trust Co...................................... Schenectady, N. Y ......... ;
9,894,876.94
Savings Investment & Trust Co..................... East Orange, N. J...........|
9.268.016.24
Fulton Trust Co............................................... New York, N. Y .............j
16,135,179.24
New Jersey Title Guarantee & Trust Co___ Jersey City, N. J ............ j
2,734,794.60
Montgomery County Trust Co....................... Amsterdam, N. Y ..........
552.322.09
First State Bank.......
Canisteo, N. Y ................ |
S, 920,147.25
Commercial Exchange Bank.......................... New York, N. Y .............!
Fifth Avenue Bank of New York.................. New York, N. Y .............I 25,436,952.05
7.031.510.21
New Netherland Bank.................................... New York, N. Y .............j
394.929.61
Bank of Suffolk County.................................. Stony Brook, N. Y ........ i
3.043.852.76
The County Trust Co....................................... White Plains, N. Y .......
599.358.88
Bank of Amityville.......................................... Amityville, N. Y ............
Cranford Trust Co............................................ Cranford, N. J .................j
1.489.602.24
1,092,579.59
Erie County Trust Co...................................... East Aurora, N. Y ......... j
4,363,259.33
Jefferson Trust Co............................................ Hoboken, N. J ................ i
1.270.314.21
Oyster Bay Bank............................................. Oyster Bay, N. Y ...........j
2,242,711.20
Mutual Trust Co. of Westchester County.. . . Port Chester, N. Y ......... |
Westfield Trust Co........................................... Westfield, N. J................ j
2,202,034.48
1,978,786.27
Seacoast Trust Co.................................” ” ” J Asbury Park, N. J .........j
4.159.396.89
Bayonne Trust Co................................. ” "**j Bayonne, N. J................. i
1,534,480.35
State Bank of Chatham............................... ill Chatham, N. Y ............... i
4.660.440.77
Herkimer County Trust Co..................
* 1 Little Falls, N. Y ...........j
677,703.27
Bank of Millbrook..............................i.llillll Millbrook, N. Y .............. !
Rockland County Trust Co............................ i Nyack, N. Y ....................j
2.124.275.39
South Norwalk Trust Co.............................
3.049.727.25
South Norwalk, Conn. . . '
368,934.77
The State Bank........................ ! ! ! ! ! ! ! ! ! ! ! ! ! " Trumansburg, N. Y ....... j
Bank of West bury............................. .........j Westburv, N. Y ............. ■
481,839.34
YorkviUe Bank.................................. ” ! ! ! ! ! ! ! New York, N. Y .............
10,885,255.90
Farmers <c Merchants Bank" 1
f
11'.
; Boonton, N. J ................. ■
480,869.99
Bank of Hicksville.......................... ............ : Hicksville, N. Y ............. i
986.407.62
Federal Trust Co................! ! ” ! ! ! .................. i Newark, N. J...................|
9.793.898.23
Columbia Bank........................
................. \ New York, N. Y .............j
18.293.353.40
Citizens Bank........................ .......................i Perry, N. Y ..................... i
1.330.203.89
Alliance Bank....................... ! " " ! ................. Rochester, N. Y .............
15,518,076.66
Floral Park Bank............
.......................... ; Floral Park, N. Y ...........j
706,034.53
Morristown Trust Co........." I ......................... ' Morristown, N. J............ I
9.225.186.77
Mutual Bank............................... [ ” *............. ; New York, N. Y .......
10,872,924.46
Trust Co. of Orange...!. 11.............................. Orange, N. J ..............
957.837.10
Syracuse Trust Co................
.................. Syracuse, N. Y ..........
17.821.127.40
Trust < Deposit Co. of Onondagalllll!!!!!! Syracuse, N. Y ...........
k
24,364,091.32

Schedule 5

—Foreign branches of American banks, December Slf 1918.

American Foreign Banking Corporation:
Branches—
Port au Prince, Haiti.
Panama City, Republic of Pana
ma.
Cristobal, Canal Zone.
Havana, Cuba.
Empire Trust Co.:
Branch—
London England.

Equitable Trust Co.:
Branches—
Paris France.
London England.
Farmers Loan and Trust Co.:
Branches—
London (
England.
Paris France.
Bordeaux, France.
St. Nazaire, France.
Neufchateau, France.

,1
,1

i Branches established before August, 1914.

2
),1

A N N U A L REPORT OF FEDERAL RESERVE B A N K OF N E W YORK.
S c h e d u l e 5 . — Foreign

branches of American banks, December SI,1918—Continued.

Guaranty Trust Co.:
Branches—
London England.
Paris, France.
Tours, France.
Brussels, Belgium.
Buenos Aires, Argentina.
International Banking Corporation:
Branches—
London England.
Yokohama Japan.
Kobe Japan.
Shanghai China.
Pekin China.
Hankow China.
Tientsin China.
Hong Kong China.
Canton China.
Manila Philippine Islands.
Cebu Philippine Islands.
Singapore Straits Settlements.
Batavia, East Indies.
Sourabaya, East Indies.
Calcutta India.
Bombay India.
Panama Republic of Panama.
Colon Republic of Panama.
Medellin, Colombia.
Santo Domingo, Dominican Re
public.
San Pedro de Macoris, Domin
ican Republic.
Santiago, Dominican Republic.
Puerto Plata, Dominican Re
public.
Mercantile Bank of the Americas (Inc.):
Branches—
Paris, France.
Barcelona, Spain.
Affiliated Institutions—
American Mercantile Bank of
Brazil—
Para, Brazil.
Pernambuco, Brazil.
Banco Mercantile Americana de
Caracas—
Caracas, Venezuela.
La Guayra, Venezuela.
Banco Mercantile Americano del
Peru—
Lima, Peru.

,1
,1
,1
,1
,1
,1
,1
,1
,1
,1
,1
,1
,1
,1
,1
,1

Mercantile Bank of the Americas—Con.
Affiliated Institutions—Continued.
Banco Mercantile Americano dell
Peru—Continued.
Arequipa, Peru.
Chiclayo, Peru.
Callao, Peru.
Banco Mercantile Americano deColombia—
Bogota, Colombia.
Barranquilla, Colombia.
Cartagena, Colombia.
Medellin, Colombia.
Cali, Colombia.
Manizales, Colombia.
Banco Mercantile Americano deCuba—
Havana, Cuba.
Mercantile Overseas Corpora^
tion—
Guayaquil, Ecuador.
Maracaibo, Venezuela.
National Bank of Nicaragua—
Managua, Nicaragua.
Bluefields, Nicaragua.
Leon, Nicaragua.
Granada, Nicaragua.
Panama Banking Corporation:
Branches:
Colon Republic of Panama.
Panama Republic of Panama,
National City Bank:
Branches—
Havana Cuba.
Cienfuegos, Cuba.
Matanzas, Cuba.
Santiago, Cuba.
Sagua la Grande, Cuba.
San Juan, Porto Rico.
Caracas, Venezuela.
Bahia, Brazil.
Rio de Janeiro, Brazil.
Sao Paulo, Brazil.
Santos, Brazil.
Santiago, Chile.
Valparaiso, Chile.
Buenos Aires Argentina^
Montevideo, Uruguay.
Genoa, Italy.
Moscow, Russia.
Petrograd, Russia.
Vladivostok, Russia*

,1
,1

i Branches established before August,. 1914.

ANNUAL REPORT OF FEDERAL RESERVE B AN K OF N E W YORK.
S c h e d u le

6 . —American

African Banking: Corporation:
New York
Anglo-South American Bank (Ltd.):
New York
Banca Commerciale Italiana:
New York.
Banca di Napoli:
New York
Chicago.
iBanco Nacional de Cuba:
New York
tBank of Montreal:
New York
San Francisco
Chicago
Spokane.
Bank of Nova Scotia:
New York
Boston
Chicago
Bank of British West Africa (Ltd.):
New York.
Bank of Taiwan (Ltd.):
New York (agency).
Banque Beige Pour PEtranger:
New York.
Banque Nationale de la Republique
d’Haiti:
New York.
Canadian Bank of Commerce:
New York
Portland, Oreg
San Francisco
Seattle, Wash
Chartered Bank of India, Australia, and
China:
New York
Colonial Bank of London:
New York

.1
.1

.1
.1
.1
.1

.1
.1
.1

.1
.1

.1
.1
.1

branches of foreign banks Decernber 31 1918.

Commercial Bank of Spanish America:
New York
San Francisco.
Credito Italiano:
New York (agency).
Hongkong & Shanghai Banking Corpora
tion:
New York
San Francisco
London & Brazilian Bank (Ltd.):
New York
London & River Plate Bank (Ltd.):
New York
Merchants Bank of Canada:
New York
National Bank of Santo Domingo:
New York
National Bank of India:
New York
National Bank of South Africa:
New York.
Philippine National Bank:
New York.
Royal Bank of Canada:
New York
Standard Bank of South Africa (Ltd.):
New York
Sumitomo Bank (Ltd.):
San Francisco.
Seattle.
New York (agency).
Union Bank of Canada:
New York
Yokohama Specie Bank (Ltd.):
San Francisco
Seattle.
Los Angeles
New York

.1
.1
.1
.1
.1

.1
.1

.1
.1
.1

1Branches established before August, 1914.

A N N U A L REPORT OF FEDERAL RESERVE B AN K OF N E W YORK.

Schedule 7.— Employees o f the bank.
Women.

Total,
1918.

Total,
1917.

B AN K DEPARTMENTS.

1
*!
‘‘4 '!
6

Accounting and reconciling.
Accounting reference files...
Adjustment.............................
Architectural..........................
A uditing..................................
Bookkeeping..........................
Cafeteria..................................
Chief clerk...............................
City collection........................
Code.........................................
Complaint and fraud.............
Comptroller.............................
Country collection.................
Coupon collection..................
Credit.......................................
C ustody...................................
Discount..................................
Distributing............................
Em ploym ent..........................
Federal Reserve agent. . . . . .
Filing and library..................
Float force......... .....................
Foreign exchange..................
Gold shipments......................
Mail—officers*.........................
Mail—outgoing.......................
Mail teller—d a y .....................
Mail teller—night...................
Miscellaneous..........................
M oney......................................
Money shipments..................
Note teller...............................
Officers’ assistants............... !

18
26 j
4 !

1
1
5
2

37
12

8!
2!

33
4
9
2
19

19
2

106
41
26
8
35
2

16
"7

48
24
33
13
83
13

.
1
;
;

11 i-

5 I
19

1i.

5
18

7 I.
3 !.

3
ii!

■
12 !.

36 '
13

17
13

74
7

28 i
13 ;

37
5

8
8

Paying teller...........................
Porters.....................................
Protection...............................
Protection—night..................
Purchasing..............................
Receiving teller......................
Reserve penalties...................
Return items..........................
Secretaries...............................
Signatures...............................
Spccial statements.................
Stenographers.........................
Supply.....................................
Telegraph................................
Telephone............................... .
Transit—day...........................
Transit (5 p. m. to 12 p. m.)..
Transit (12 p. m. to 8 a. m .) ..
Vault.........................................
Warehouse................................
Welfare......................................
Wire transfer............................

3 1

21
21

17
25

15
8
5
5
20

9
4
24
2

2
12
308
63

17
3

26
4
4

340
75
32
4
4
11

167

*
2
'**7

1.350

Total.
GOVERNMENT DEPARTMENTS.

Bond issue and exchange........................................
Capital issues committee.........................................
Coupon payment.......................................................
Custody.......................................................................
Government check....................................................
Government deposit.................................................
Certificate of indebtedness:
Clerical.................................................................
Sales......................................................................
Total.

115
4
4
40
31
44

105

1
2

loan

228

5
23
42
42
63

19
52

192

33
36
45
53
103

28
63
272
77

270
1,135

538
1.495

472

333

o r g a n iz a t io n .

Administration..........................................................
Distribution...............................................................
Partial payment—third...........................................
Partial payment—fourth.........................................
Publicity.....................................................................
Total............
Grand total.

220

73
4

38
4
280

l ib e r t y

496

317
130
201
SS
O

829

ANNUAL REPORT OF FEDERAL RESERVE B A N K OF N E W YORK.
S c h e d u l e 8 . —Certificates

Loan.

Date of
issue.

of indebtedness.

Maturity
date.

Rate.

P e r cent.

Total sale.

Total allot
ment, second
district.

Third.
Third.
Third.
Third.
Fourth.
Fourth.
Fourth.
Fourth.
Fourth.
Fourth.
Fourth.
Fifth.
Fifth.

1 Tax certificates.

Jan.
Jan.
Feb.
Fob.
Feb.
Mar.
Mar.
Apr.
Apr.
Apr.
May
June
July
July
Aug.
Aug.
Sept.
Sept.
j Oct.
Nov.
j Dec.
j Dec.

2.1918 June 25, 1918
22.1918 Apr. 22, 1918
8.1918 May 9, 1918
15.1918 June 25, 1918
27.1918 May 28, 1918
20.1918 June 18, 1918
15.1918 June 25, 1918
10.1918 July 9, 1918
22.1918 July 18, 1918
15.1918 June 25. 1918
15.1918 ___ do...
25.1918 Oct. 24,
9.1918 Nov. 7, 1918
23.1918 Nov. 21, 1918
6.1918 Dec. 5, 1918
20.1918 July 15, 1919
3.1918 Jan. 2, 1919
17.1918 Jan. 16, 1919
1.1918 Jan. 30, 1919
7.1918 Mar. 15, 1919
5.1918 May 6, 1919
19.1918 June 20. 1919

|
i
l
i
I

ms''

* Subscription of $239,017,000.
S c h e d u le 9 .— Liberty

i4
4
4
i4

4
*

i4
i4

4
*
4
4
4
4
4
4
i4
4^

4
4

144

. 4
i

4
1

$491,822,500
400.000.000
500.000.000
74.100.000
500.000.000
543.032.500
110.962.000
551.226.500
517.826.500
71.880.000
183.767.000
839.646.500
753.938.000
584.750.500
575.706.500
157.552.500
639.493.000
625.216.500
641.069.000
794.172.500
613:438,000
572.491.000

*239,954,000
2 209,685,000
241.322.000
14.007.500
3 172,666,500
193.700.500
10.252.500
215.448.000
222.486.000
12,000,500
61,188,000
312.844.500
273.219.500
211.714.000
207.287.000
44,766,000
210.068.500
216.264.500
249.591.000
350.847.500
222.830.000
199.117.000

10,742,094,000

Third.
Third.

1,091,260,000

* Subscription of * 107 , 715 ,000 .

loan subscriptions.

THIRD LOAN.
Amount of
Number of
subscriptions, subscribers.

Class.
*50....................

$96,284,350
57,711,700
69,651,100
46,789,500
3,072,300
106,447,000
35,509,650
38.175.000
9,533,050
60.060.000
127,456,850
68,557,600
50,145,050
345,850,500

Total..

1,925,687
577,117
298,921
93,579
4,417
106,447
15,800
7,635
1 371
6,006
4,628
763
322
430

1,115,243,650

S100.......................
1150 to $450.............
*500.........................
*550 to *950.............
*1,000.....................
*1,050 to *4,950
*5,000......................
15,050 to *9,950
*10,000......................
*10,050 to *50,000.
*50,050 to *100,000..
*100,050 to *200,000.
Over *200,000..........

3,043,123

*113,958,250
88,741,300
33,005,800
43.682.000
9,733,100
118.376.000
81,242,250
68.225.000
32,927,400
104.830.000
279,570,800
156.613.950
145.827.950
768.167.950

2,279,165
887,413
138,509
87,364
14.483
118,376
35,570
13,645
4 710
10.483
10,596
1,886
933
967

FOURTH LOAN.
*50..............

*100 ....................

*150 to *450........
*500.....................
*550 to *950........
1,000
*1,050 to *4,950
*5,000....... .
*5,050 to *9,950..
*10,000........
*10,050 to *50,000
150,050 to *100,000
*100,050 to *200,000
Over *200,000.

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

Total..

2,044,901,750 2,069,806.17

A N N U A L REPORT OF FEDERAL RESERVE B AN K OF N E W YORK.

S c h e d u l e 1 0 .— Ratio o f subscriptions received, third and fou rth loans.
THIRD LOAN.

Per cent
Number JNumber
Amount of
in second! subscribe subscriptions. of total
subscrip
district. I instion.

Hass of bank.

National banks..................................................................
State banks........................................................................
Trust companies...............................................................
Savings banks...................................................................
Individuals (including foreign and private bankers).

624
228
193
105

625
229
202
178

48. 6
13.2
35.2
2.0
1.0

.j................ j 1,115,213,650

Total..

5541,400,250
147,024,900
393,092,200
21,990,850
11,735,450

100.0

Quota, 5900,000,000.
FOURTH LOAN.
National banks..................................................................
State banks........................................................................
Trust companies...............................................................
Savings banks....................................................................
Individuals (including foreign and private bankers).

625 !
229
202
178

622
228
196
89

$962,662,650 :
272,686,300
759,660,100
26,440,250
23,452,450 •
| 2,044,901,750

47.1
13.3
37.2
1.3
1.1
100.0

Quota, $1,800,000,000.
S c h e d u l e 1 1 .— S u b scrip tion s, third and fou rth loans, by geographic subdivisions.
THIRD LOAN.

Division.

Quota.

Number of]| Average
Amount of
I
subscriptions. subserib- :j size.
ers.
•

!
j Subscrip!Itions per
: capita.

$43,626,500

*57,525,500

286,426

9201 ;

156.51

20,969,400

24,777,450

115,090

215 j

41.74

29,071,800

35,669,550

183,152

194 '

41. 66-

74,474

178 !

33.53

48,346,150
12,527,500
114,867,200

201,346
50,966
495,041

240 |
!
245 .
i
232 |

40.69
38.98
52.14

17,666,300

34,539,850

181,750

190

56.25

238,272,000

341,500,750

1,588,245

215

48.18

618,794,000
39,616,900
3,317,100
1,032,900
4,364,400

701,167,700
53,001,950
5,361,150
3,386,800
10,825,300

1,248,327
116,855
24,417
19,262
47,493

561
453
219
176
228

276. 42
29.46
8.70
34.33
27.29

Total, Greater New York.

661,728,000

773,742,900

1,456,354

531

142.07

Total for the district.........

900,000,000 1 1,115,243,650
>
>
j > f >

3,044,599

366

88.98

Subdistnct No. 2 (Rochester and vicin
i t y ) - . . ......................................................
Subdistrict No. 3 (Utica and Syracuse
and vicinity)............................. V ...........
Subdistrict No. 4 (Binghamton and vi
cinity) .....................................................
vicinity)
lbdistrict
Subdistrict No. 6 (Longisland)!
ibdistrict____ ________ _
,
Subdistrict No. 7 (Northern New Jersey)
Subdistrict No. 8 (Westchester County,
x Y ., and Fairfield County, Conn.)..
Total outside of Greater New York.
Manhattan..
Brooklyn___
Bronx...........
Richmond».
Queens 1
.......

9,449,900 |
34.691.000 !
10,872,100
71.925.000

13,248,550 1

1 Parts of, but not included in figures for subdistrict No. 6.
116015— 1 9 ------- 6

f
i

A N N U A L REPORT OF FED ER AL RESERVE B A N K OF N E W

S c h e d u le

YORK.

U — Subscriptions, third and fou rth loans, by geographic subdivisions— Con.
FOURTH LOAN.
nf

Number of

Division.

u .O ..,m <SubscripP

er:s.
324.310

$95,231,250

$87,253,400

flubdistrict No. 1 ( Buffalo and vicinity)..
Subdistrict No. 2 (Rochester and vicin
ity)...........................................................
Subdlstri'*t No. 3 (Utica and Syracuse
and vicinity)...........................................
Subdistrict No. 4 ( Binghamton and vi
cinity )......................................................
SubdistrL't No. 5 (Albany and Troy and
vicinity)...................................................
Subdistrict No. 6 H.ong Island)..............
Subdistriet No. 7 (Northern New Jersey).
Subdistrict No. 8 (Westchester County, :
N. Y ., and T-airfield County, Conn.)...

S293

$93.55
76.87

42,214,800

15.628.100 !

191,997

58,143,600

63,054,850 !

219, S33

286

73. tf4

18.900.000 I

22,225,900 i

100,851

220

56.25

69.382.000
10,841,400 *
143,850,000

77.653.100 i
19,228,950
199,131,150

224,847
62;077
607,089

345
309
327

J . 94
W
90. 39
86.37

0.3
36

35,332,400 !

53,029,700

215.310

246

465,917,600 ;

Toni outside of Greater New York.:

575,183,000

1,946,314

295

81.14

”1,168,270
290,453
34,140
33,660
131,203

1,146
347
170
152
136

1>28.17
56.17
9.44
51.80
45.25

236,605,800
79,233,800
6,634,200
2,173,900
9,434,700

M a n h a t t a n ..

Brook I; n___
M r o n x .............

Richmond 1
t/ueens *.......

Total, Creater New York................ 1,334,082,400

j 1,339,841,950
! 101,032,950
5,812,300
^
<
5,109,650
17,951,900

269. S6

1,469,748,150 j 1,657,786

Total for the district........................ < 1,800,000,000’j”2,044,901/750

163.14

3^6(^100

i Parts of, but not included in figures for subdistrict No. 6.
S c h e d u le 12.— Expenses o f third and fourth Liberty loans to December 81 , 191S.
THIRD LOAN.
Fiscal agency organization.
Expense classifi
cation.

Bond
issue.

Salaries, regular....... $144,649.81
8,202.31
Printing, stationery,
and forms..............
15,017.47
Prinrin? circulars and
deseripthe matter.
2,050.00
Traveling expenses..
1,106.54
Telephone and tele
graph......................
2,964.5$
Expressage..............
247.88
Postage....................
6,560.38
Equipment..............
23,736.48
Rent........................
12,687.43
Newspapers and di
1.50
rectories.................
Bands, music, and
speeches.................
Banners, booths,and
signs..................... .
Miscellaneouosupplies 11,705.31
General plant service 57,750.74

Salaries, overtime__

Total.

Liberty loan organization.

286,680.41

; Cortifi- i
cates of j Govern
, indebted- j ment
ness, i deposit.

Distribu- p ublieitv
tion.
! ruDncuy-

Administration.

$41,476.45 i?53,031.35 $396,974.97 £225,401.28 $25,159.65
2,284.64
5,560.62
-7,226.29
50.799.10
13,833.52
j 4,138.73
I

Total.

$886,693.51
87.906.45

' 1,627.75
i
22.26
10.00
4,038.25
: 2,585.13
I

2,391.77

189,640.02

16.331.22

24,365.57

251,884.7$

491.62

83,302.32
45,677.08

143,270.82
20.485.22

9, *59.80
24.14

239,731.14
67,295.38

792.11

17,009.65
8,239.03
4,542.26
40,871.03
42.628.30

8,357.85
! 14,030.73
■
357.06
| 18,226.33
1 8,774.74

747.55
2.984.47
S.77
8,372.75
10,778.60

31,499.47
25,524.37
11.549.55
97,258.03
80,626.53

276.50

3,533.11

7.00

18,932.63

756.58
2.40 j

21,617.83

71.08
2,013.19
3,172.33
103.65

34.993.31
31,250.95
70,708.28

75,781.86
17,017.01
34,534.56

63,197.94 j 70,499.05 1,035,845.43

621,553.14

1,648.32 j
1,331.45 I

395.42
810.24

3,921.76
40.550.46

174.25
11,359.12
1,113.67

110,949.42
73,376.13
166,248.94

97,239.98 2,175,015.95

A N N U A L REPORT OF FEDERAL RESERVE B A K K OF NEW YORK.
S c h e d u le

12.— Expenses of third andfourth Liberty loans to December 31, 1918—
Continued.
F O U R T H LO A N .

Fiscal agency organization.
Expense classifi
cation.

Bond
issue.

j Certifi
cates of
indebt edi ness.

Salaries, regular........ $107,606.02 $41,746.
Salaries, overtime___ 15,386.39 ; 5,925.
Printing, stationery,
and form s...........
11.048.08
3,758.39
Printinj circulars and
j
descriptive matter J
536.73 i 4,380.09
Traveling expenses, -j
11. 30 [..................
Telephone and tele^
18.28
197.77
graph.....................
204. 66
Expressage...............
Postage........................
5,023.17
Equipment.................
8,713.94
2,230. 73
‘ —
R en t............................
7,021.32 j lj 801 6 4
Newspapers and di,
53.25 :
rectories.........................................:
Bands, music, and !
speeches.............................................................
Banners, booths, and
35.00
signs..........................:.................... |
Miscellaneous supplies
3,262.76 !
388.69
General plant service
4,035.46' 1,215.44 j
Total..................I 162,868.11

61.732.68

Govern
ment
deposit.

Liberty loan organization.

Distribu
tion.

Publicity,

Adminis
tration.

Total.

033.57 ?217,384.11 $246,655. 45 ?37,626. 24
41,085.07
31,576.62
4,396.89
630.66

$685,051. 5
t>
100,001.14

1,163. 26

272,667.06

27,865.34 * 14,424. 71

332,926.84

135. 00

41,188.24
37,744.19

235.983.61 : 2,480.83
2(>;432.59,
97.91

284,704. 50
58,285.99

1,060.14
19,619.16
347. 59
21,347. 91
14,808. 59

1,851.27
4,233. 39
171. 50
7,374. 50
3,155.65

15,342. 71
31,940. 42
56,063. 60
•Jl, 509. 73
61,640.28

3,170.67

3.78

4,391.47

654. 00
248. 34
13. 65

12,215. 25
7,882.60
50,521.34
51,188. 65
33,604. 74
1,150.12
51,347.01

90.07
168.91
41,138.07

95,048.35 ................. | 146,395. 36
117,213.35
29, L *4 59
'v .
55,054.63

48,616.07 , 6S, 294.56 ;
267.72
9.892.19
8,440.52 : 7,210.36
36,084.45 1 12,133.52
1,416.85
912,571.09 j 806,784.62

M , 711.60 2,069,806.17

Schedule 13 .— Capital account reconciliation, Jan. 1 to Dec. 81, 1918.
Capital paid in Jan. 1, 1918..................................................................................................................... $18,684,850
Sundry increases:
Due to increase of capital and surplus of member banks....................................... $1,221,850
Due to organization of new national banks...............................................................
1,350
Due to admission of State banks and trust companies........................................... 1,071,350
—------------2,294,550
20,979,400
Sundry decreases:
Due to decrease in capital and surplus of member banks.......................................
300
Due to banks liquidated...............................................................................................
000
1
^---------------Paid in capital Dec. 31, 1918............................................................................................................

174,300
20,805,100

Schedule 14.— Summary o f Federal Reserve notes.
Total issued to bank:
1914, 1915, 1916, 1917..................................................................................................................'
191S....... ......... ...........................................................................................................................

,513,000
589,400,000
1,190,913,000

Less notes unfit for circulation retired 1914, 1915, 1916,1917...................... **145, 174,435
Less notes unfit for circulation retired 1918................................................... 226,722,730
-------------------

371,897,165

Amount outstanding Dec. 31,1918.......................................................... ..........................

819,015,835

As follows:
.f
In actual circulation.................................................................................................................
Held by Federal Reserve Bank Dec. 31,1918.....................................................................

*24, < *;
*3
89j 191, oOa
819,015,835

On Dec. 31,1918, the Federal Reserve agent held agauist Federal Reserve notes:
Gold certificates.........................................................................................................................
Commercial paper......................................................................................................................

___
392,165.00
^

Total......................................................................................................................................... 1,049,310,253.63
1 Includes $26,033,000 of notes fit for circulation returned by the bank and by the United States
Treasurer.

ANNUAL REPORT OF FEDERAL RESERVE BANK OF N EW YORK.

S c h e d u le

15 .— Total o f Federal Reserve notes paid out by the Federal Reserve Bank of
New York, by months, 1918.
T o nonmember banks

T o m ember
banks.
$41, 763.000
61, 278.000
386.000
67 543.000
55; 262.000
418.000
593.000
t2' 244.000
89,
88 573.000
86 150.000
73, 627.000
104, 185.000

S3, 129.000
2, 022.000
2 ,605,000
2 , 342.000
1 776.000
,
%983.000
1 413.000
755.000
1 019.000
203.000
i; 547.000
2, 352.000

907,022,000
23,146,000

23,146,000

Total paid to nonmember ban ks............
Total received from Federal Reserve agent..

930.168.000
589.400.000

Januan —
February...
M a rch .......
A p r il........

69j

M
ay.......

77j

June...........

J u ly .........
A u g u st .....
Septem ber.
O ctober----Novem ber.
December. *

S c h e d u le

,
,

16.— Movement of Federal Reserve notes between Federal Reserve Bank of
New York and other Federal Reserve Banks, Jan. 1 to Dec. 81, 1918.

From Federal Reserve B a n k of—

A tla n t a .......
Bo sto n .........

Notes of
Federal
Reserve
B a n k of
N e w Y o rk
received.

C leveland.....
D a lla s...........
K a n sa s City...
Minneapolis...
Philadelphia..
R ic h m o n d _
_
St. L o u is.......
San Francisco.

165,750
1,300
226,000
517,450
989.850
691.050
001,300
178,000
742,900
274.050
240,820

T o ta l...

Their
notes
shipped.

To Federal Reserve B a n k of—

300,050
415,400
085.950
639,700
977,800
406,000
312,750
085,350
519,100
013,150
873.950
5,8

118,050,470

C icag
h o......

Schedule

A tla n ta ........
Bo ston ..........
Ch icago........
Cleveland----D a lla s...........
K a n s a s City...
M inneapolis. -,
Philadelphia..
R ic h m o n d ___
St. L o u is.......
San Francisco.

118,629,200

17.— Summary o f gold settlementfund operations, Jan. 1 to Dec. 31, 1918.

From or to Federal Reserve
B a n k of—

A m ou n ts received and paid \ry the
N ew Y o r k Federal Reserve B a n k
in settlement of accounts due.
Received.

B i* J* _
o1
T ston ...........................
l
i
»
--P hila de lp h ia .................
C levelan d ....................
R ic h m o n d ...........................
A tla n t a ............................
C h ic ago... „....................
St. L o u is.....................
M in n eap olis..............

*2,653,341,793.38
3,120,296,067.46
2,170,184,540.50
1,221,227,283.37
501,450,567.96
2,700,218,462.26
791,185,425.53
631,171,389.45
763,295,709.41
D a lla s ...........................
433,858,198.13
Sa n Francisco..............
1,180,968,773.34
Federal Reserve agent..........
172.000.000.00
Treasurer of United States___
159.058.000.00
T o ta l..........................
G a in ...........................

16,498,256,210.79

N e t loss.

N e t gain.

Paid.

*2,677,384,815.43
2,981,806,142.38
1,836,466,723.75
1,364,498,260.70
752,163,009.71
3,248,800,605.65
582,125,736.46
725,818,906.49
594,527,787.62
448,527,571.69
1,071,180,195.15
101,000,000.00
53,020,000.00
16,437,319,755.03
60,936,455.76

$24,043,022.05
$i38,489,925.08
333,717,816.75

" ' "i43,*270,977.*33
250,712,441.75
548,582,143.39

209,059,689.07
168,767,921.79

*94,647,*5i7* 04
“

*i4,*669,'373*56

109,788,578.19
71,000,000.00
106,038,000.00
1,136,861,93a 88

1,075,925,475.12
60,930,455.7*

A N N U A L REPORT OF FEDERAL RESERVE BA N K OF N E W YORK.
S c h e d u le

18.— Fiduciary powers granted national banks during 1918 in Second District
by Federal Reserve Board.

Powers granted— Trustee, executor, administrator, registrar of stocks and bonds,
guardian of estates, assignee, receiver, committee of estates of lunatics:
Asbury Park, N . J . , Merchants National Bank.
Morristown, N . J., National Iron Bank.
Paterson, N . J . , Second National Bank.
Phillipsburg, N . J . , Phillipsburg National Bank.
A lb an y, N . Y ., National Commercial Bank.
Buffalo, N . Y ., Manufacturers

& Traders National Bank.

Canandaigua, N . Y ., Canandaigua National Bank.
Canton, N . Y ., St. Lawrence County National Bank.
Oatskill, N . Y ., Catekill National Bank.
Cooperstown, N . Y ., Second National Bank.
Dunkirk, N . Y ., Lake Shore National Bank.
Elmira, N . Y ., Second National Bank.
Geneva, N . Y ., First National Bank.
Glens Falls, N . Y ., Merchants National Bank.
Hudson, N . Y ., First National Bank.
Jamestown, N . Y ., National Chautauqua County Bank.
Lockport, N . Y ., Niagara County National Bank.
New York, N . Y ., American Exchange National Bank.
New York, N . Y ., Atlantic National Bank.
New Y ork, N . Y ., Chemical National Bank.
New York, N . Y ., Citizens National Bank.
New Y ork, N . Y ., First National Bank.
New Y ork, N . Y ., Hanover National Bank.
New Y ork, N . Y ., Irving National Bank.
New York, N . Y ., Lincoln National Bank.
New York, N . Y ., Mechanics & Metals National Bank.
New York, N . Y ., National Park Bank.
Nyack, N . Y ., Nyack National Bank.
Oneonta, N . Y ., Citizens National Bank.
Utica, N . Y ., Utica City National Bank.
Watertown, N . Y ., Watertown National Bank.
Powers granted— Trustee, executor, administrator, registrar of stocks and bonds,
guardian of estates, receiver:
Bridgeport, Conn., City National Bank.

Powers granted—Trustee, executor, administrator, registrar of stocks and bonds,
guardian of estates, assignee, receiver:
Elmira, N . Y ., Merchants National Bank.

Powers granted—Trustee, executor, administrator, registrar of stocks and bonds,
guardian of estates, receiver:
Greenwich, Conn., Greenwich National Bank.
PowerB granted — Trustee, registrar of stocks and bonds:
Frenchtown, N . J., Union National Bank.

Powers granted—Registrar of stocks and bonds:
Paterson, N , J., First National Bank.

ANNUAL REPORT

S c h e d u le

OF ^FEDERAL

RESERVE B A N K 01* N E W YORK.

19.— Honor roll of employees in the military or naval service of the United
States.
Name.

Entered serv-1
ice.
!

Apr. f», 19
Ait ken, Harold R .....................................
Mav 10,19
\nderson, Harry A ..................................
Mar. 9,19
\nderson, William C...............................
Apr. 5,19
Bedell, llenry M.......................................
Mar. 1,19
Behan, 'William F ....................................
Aug. 15,19
Berger, Harry A .......................................
Apr. 5,19
Black, Norman P .....................................
Jan. 15,19
Mack lord, Eupene O...............................
Dec. 15,19
Blackman, Harry 1!., jr ..........................
Sept. 21,19
Blumberg, Loo..........................................
Apr. 1^,19
Bowen, Harold J ......................................
Apr. 23,19
Brennan. Thomas S .................................
Apr. 12,19
Byrne, Kdmund J ....................................
Aug. 31,19
Cameron, Donald J ..................................
Carey. Jack H..................................................... ; July 15,19
Carnahan, Robert S ...........................................: Sept. 14,19
Cokelet, william V an....................................... i May 25,19
Conover, William I I .......................................... Juiie 22,19
Cook, James R .................................................... i July 19,19
Curtis, Frank M..................................................! Sept. 4,19
Cuvier, Theodore I*. . .*..................................... Dec. 15,19
Dackerman, Frank............................................ 1 Aug. 9,19
Dencker, Rudolph R .........................................1 Aug. 3,19
Denny, Daniel.................................................... May 24,19
Donaldson, Guy................................................. ! Dec. 15,1?
Doyle, Frank P .................................................. i July 20,19
Drew, Earl........................................................... I May 1,19
L
Dnnn, John A .....................................................I Apr. 27, M
Duvall, Steele......................................................i Apr. 23,1918
Khm, William A................................................ ! July 16.19
lily
Ermete, Martin C .........................................'. . . j Sept. 28,19
Emost, Frank, jr ................................................| Sept. 15.19
Farrell, Frank.....................................................! May 23,19
Felton, William..................................................! Mar. 1,19
Ferens, Albert W ...............................................j June 30,19
Flanagan, James K .......................................... Oct. 15,19
Fleming, John................................................... Mar. 19,19
Foulon, Clement............................................... July 27,19
Fumald, George............................................... Sept. 1,19
Gardner, Douglas F ......................................... May 22,19
Ghia, Arthur.....................................................
July 27,19
Gilchrist , William J ......................................... July 15, If
Gleason, Parker A ....................................
June 6,19
Goddard, L. W ................................................. Oct. 1,1918
Gorman, Wilbur B ........................................... Aug. 3,1918
Griffis, Frederick........................
Nov. 3 0 ,l»r
Griffiths, Wilbur C..................................... ! !
Mav 5,19
Guy, Earl...........................................................
Dec. 31,19
Hamilton, Charles C ...............................
July 12,19
Hannett, Arthur..................................... ” ’ ’ ’
Aug. 31,19
Hanson, Michael A..................................... ! ! !
June,
19
Hart, William.................................................... Nov. 30,19
Haviland, Roger M .......................................... Dec. 15,19
Helfrich, Henry W. A..............................’
July 15,19
Henry, Thomas.....................................
Sept. 4,19
Hughes, George Y ...................................’ ' " * Dec. 8,19
Jacobus, Joseph L .........................................
Sept. 3,19
O’Grady. Robert.........................................
Aug. 15,19
Lange, w illiam ......................................
Sept. 23,19
Steiger, Geo........................................................ July 31,19
Jcanson, Adolf....................................
July 24,19
Johnson, Frank............................
May 20,19
Judge, Joseph A .......................
Oct. 31,19
Judson, Henry........................
Aug. 24,19
Keeler, Charles J ............................................... Nov. 15,191.
Keyes, Howard E .................... !' ... ................
Nov. 4,1918
Sept. 4,19:
Mar. 31,191«
—, ___ lerick..........
Mar. 26,1918
Lackaye, George J.........
June 22,191“
Langan, William, jr.......
July 10,19
Leger, Louis W m ...........
Apr. 30,19
Leonard, William J.......
July 27,1
Lewis, Conrad B............
Dec. 15,19
Lewis, Donald J.............
....... d o ........
Lewis, Ernest E .............
Sept. 1,1918
Lord, Lyman C., jr........
May 23,19
Lowell, Charles...............
Nov. 21,19
McCormick, George J. . .
Dec. 1,1917
McPherson, William___
Apr. 15,1918
Maloney. Raymond.
Feb. 19,1918
Manee, Basil............
Feb. 28,1918

Branch of service.
Marines.
Navy.
Army.
Naval Reserve.
Do.
Signal Corps.
Armjr.
Do!
Student Army Training Corps, Harvard.
Navy.
Army.
Do.
Canadian Royal Flying Corps.
Student Army Training Corps, Columbia.
Army.
Do.
Do.
Do.
Navy.

t)o.

Signal Corps.
Army.
Navy.
Army.

f>
o.

Do.
Do.
National Guard.
^ T
,
Student Army Training Corps, St. John s.
Naval Reserve.
Army.

f>
o.

Do.
Do.
Navy.
Do.
Merchant Marine.
Army.

Do.

Do.
Naval Reserve.
Navy.
Naval Reserve.
Royal Flying Corps.
Army.

f>
o.
t)o.

Navy.

Do.
Army.
Navy.
National Guard.
Army.
Navy.
Army.
Do.
Student Army Training Corps.
Merchant Marine.
Armv.
Do.
Student Army Training Corps.
Army.
Navy.
Army.

i)o.

Do.
Do.
Do.
Navy.
Army.
Navy.
Da
Do.
Merchant Marine.
Army.
Navy.
Armv.
Do.
Do.
Do.

A N N U A L REPORT OF FEDERAL. RESERVE B A N K OF N E W YORK.

Schedule 19.— Honor roll of employees in the military or naval service of the United
S tates—Continued.
i Entered serv- j
ice.
j

Name.

Marcus, "Warren, jr........................................... Doc. 10, 1917
Markert, Russell E ............................................ Mar. 15, 1918
Mellor, Walter................................................... Nov. 30, 1917
Meyran, George D., jr......................................! Nov. 23, 1917
Miller, Edward A ............................................. Apr. 30, 1916
Moore, TV. B. J................................................. Julv 15, 1917
Muller, Carl........................................................ M
ai*. 14, 1918
North, James C ................................................. June 15, 1918
Pannick, Frank, jr........................................... Mar. 2, 1918
Peper, John L ................................................... Sept. 15, 1918
Prescott, Harvey B ......................................... : Dee. 31, 1917
Pronek, Lawrence T......................................... Oct. 24, 1918
Quirk, William A ............................................. Sept. 21, 1917
Reinhrecht, Downing A .................................. Dec. 1, 1917
Ross, Irwin G.................................................... Sept. 30, 191$
Schultz, George W ........................................... May
1917
Schwartz, Roland J.......................................... Sept. 7, 191$
Scott, Joseph D ................................................ June 3, 1915
Seifert, Louis J.................................................. May
1918
Senior, Charles, jr.............................................‘ Sept. 15, 1917
Simpson, James L ............................................. Feo. 27, 1918
Somers, Sutphen M .......................................... June 2, 1918
Stiess, Henry F ................................................ May 21, 1918
suker, George.................................................... Sept. 1, 1918
Tomkins, Edward J......................................... Nov. 24, 1917
1916
Weaver, Luther O ............................................ June
Wiese, Rudolph E ........................................... Dec. 15, 1916
Wightman, W alter H ...................................... May 15, 1918
Wills, Ralph G ................................................. July 27, 1918
Widget, Clifford................................................ July 21, 1917
Wise, John 13.................................................... : Oct. 1, 1918
W’ onsor, Edward.............................................. ; Dec. 28, 1917
York, Clarence S............................................... i Julv 20, 1918

_________ ________________ <

T
W
I s
W
Alcedo,

w
i
l

o
l

a
e

o
i

n
a
w

a
d
v

e
h

m
,

: Army.
:
Do.
Navv.
Army.
f)o.
National Guard.
; Armv.
Navy.
Army.
Student Army Training Corps, Columbia.
i Navv.
; Army.
Do.
Do.
Do.
• Navv.
Army.
* Navy.
1 Army.
;
Do.
:
Do.
Naval Reserve.
Armv.
Do.
Do.
Navv.
Army.
Marines.
; Navy.
New Jersey National Guaid.
: Navv.
bo.
( Army.

F
w
r

Branch of service.

a
w

a
s

s
a

i
a

a
w

l l
m
u

One day after receipt:
Boston.
|Baltimore.
Philadelphia.
tPitts^U
IKh.
Richmond.
Roanoke, Va. (see par
list).
Cleveland t
■(•Cincinnati.
Chicago.
fDetroit.
Atlanta.
Minneapolis.
St. Paul.
St. Louis.
Kansas City, Mo.
Kansas City, Kans.
tLouisville.
t Branch banks.

Banks In—

Connecticut.
Delaware.
District of Columbia.
Maine.
♦Maryland.
♦Massachusetts.
New Hampshire.

New Jersey.
♦New York.
♦Pennsylvania.
Rhode Island.
Vermont.
♦Virginia.

* Except banks in cities referred to in first column.

d
h

o
n

Schedule 20.—Schedule shoiving when the proceeds of items u ill become available.

Immediate creditt
New York (Manhattan); when received by 9. a. m.

Two days after receipt:

B
n
k

g
b

ANNUAL REPORT OF FEDERAL RESERVE BAN K OF N E W YORK.

Four days after receipt:
Dallas.
tNew Orleans.
tDenver.
fOmaha.
tSpokane.
fSalt Lake City,
f Portland, Oreg.
t Seattle.
San Francisco.

Hanks i n -

^Minnesota.

Alabama.
Arkansas.

Mississippi.

Florida.
*Georgia.
*Illinois.
Indiana.

^Missouri.
North Carolina.

Iowa.
* Kansas.

Tennessee.
W est Virginia.

^Kentucky.
^Michigan.

Wisconsin.

*Ohio.
South Carolina.

Eight days after receipt:
Ba n ks in —

North Dakota.
Oklahoma.
*Oregon.

Arizona.
^California.
^Colorado.
Idaho.
^Louisiana.
Montana.

South Dakota.
*Texas.

*Nebraska.
Nevada.
New Mexico.
t Branch banks.

*Utah.
* Washington.
W yom ing.

* Except banks in cities referred to in first column.

N ote.—T wo day items we forward on Saturday will be available Tuesday.
Four day items we forward Thursday will be available Tuesday and those forwarded Friday and Satur*
day on Wednesday.
To obtain quickest availability of funds, sort and list checks in accordance with above time schedule,
with a separate cash letter for each separate time group.
Banks desiring to send checks direct to other Reserve Banks or their branches will please secure from u»
the circulars showing the territory handled by the branches.
June l, 1918.

Full text of Annual Report of the Federal Reserve Bank of New York : Fourth Annual Report of the Federal Reserve Bank of New York for the Year Ended December 31, 1918

FRASER