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FIFTH ANNUAL REPORT of the FEDERAL RESERVE BANK OF PHILADELPHIA FOR THE YEAR ENDING DECEMBER 31,1919 FIFTH ANNUAL REPORT of the FEDERAL RESERVE BANK OF PHILADELPHIA FOR THE YEAR ENDING DECEMBER 31, 1919 PUBLISHED BY THE BANK Table of Contents Reserve position Discount rates Loan and discount operations Bills discounted Open market operations Earnings and expenses Profit and loss account Statement of condition Federal reserve notes Federal reserve bank notes Coupon department Collection department Gold settlement fund Transit and clearings Internal organization General business conditions Banking conditions in district Resources of banks Fiduciary powers Acceptances up to 100 per cent State bank members Department of examination Fiscal agency operations Final payments on Fourth Liberty loan Victory Liberty loan Summary of Liberty loans Certificates of indebtedness Government deposits War savings division , 5 8 8 13 14 14 15 17 20 21 22 23 24 24 27 29 30 30 33 35 35 37 37 37 37 38 40 41 41 Charts Reserve position Earning assets Earnings and expenses 7 11 16 Assets Liabilities Federal reserve note circulation Transit department operations Fiduciary powers State bank members 18 19 20 26 34 36 Fifth Annual Report of the Federal Reserve Bank of Philadelphia The reserve ratio of this Bank hovered between 40 and 45 per cent all the year, the higher percentages being prevalent early in the year. The cash reserve in 1919 averaged approximately $130,000,000 as compared to $150,000,000 in 1918. Federal reserve note liabilities held fairly steady at levels considerably in excess of the average figures for 1918, and deposit liabilities were also larger. The demands on the Bank for loans and discounts to carry the large amount of subscriptions to Government bonds, notes and certificates received from this district, so reduced its reserve that it was compelled to rediscount constantly throughout the year. The table which appears below gives weekly figures showing items of interest in connection with the reserve position. An illustrative chart shows the reserve position during the past year. Reserve Position (000's omitted) 1919 Gold held Total cash Net deposits Federal reserve note circulation Net liability Reserve ratio Contingent liability Jan. 3 10 17 24 31 $126,545 144.860 138.877 125,847 134.823 $127,889 146.513 141.128 127.138 135.252 $72,661 91.171 89.604 99,205 91,818 $231,372 224.109 216.301 211.250 209.920 $304,033 315.280 305.905 310.455 301.738 42.1 46.5 46.1 41.0 44.8 $22,833 22.068 13,066 4.424 11.686 Feb. 7 14 21 28 135,316 132.371 128.593 129.448 135,695 132,670 128.979 129.751 102,530 105,315 99,441 103.283 208.865 214,301 213,258 210.768 311,395 319.616 312.699 314.051 43.6 41.5 41.2 41.3 6,122 10,000 14.600 19.700 Mar. 7 14 21 28 134,661 130.357 128,120 125.569 134.872 130.665 128,476 125.893 106.296 107,540 101.717 99.609 210.099 206,956 205.885 206.086 316,395 314,496 307,602 305,695 42.6 41.5 41.8 41.2 11.500 15.000 30.000 31.370 Apri. |} 18 25 128.701 129.980 126,010 125,952 128.930 130.256 126,331 126.595 100.383 104.593 92.683 104.601 206,696 206.336 208.296 206.594 307.079 310.929 300.979 311.195 42.0 41.9 42.0 40.7 43.250 45.950 36.330 29.496 2 9 16 23 29 125,699 126,489 130,575 123.831 127.340 126.521 126.907 130.967 124.402 127.643 108,078 106,401 114.441 99,165 111,132 204.468 203.709 204.912 201.362 205.734 312,454 310.110 319.353 300.527 316.866 40.5 40.9 41.0 41.4 40.3 35.216 31.685 25.315 27.341 35.533 June 6 131.239 135.777 132.637 124.622 131.514 136.051 132,887 124.873 96.831 130.457 120.262 104.414 207,352 203.710 200.619 203.703 304.183 334.167 320.881 308.117 43.2 40.7 41.4 40.5 35.281 36.366 56.966 57.966 127.492 127,448 144.514 131.305 127,740 127.813 144,755 131.461 105.339 105,259 118.872 111.864 203.310 204,046 201,957 201.693 308.649 309.305 320,829 313.557 41.4 41.3 45.1 41.9 35.983 39.875 38.845 34.900 May 20 27 Ju.y 3 18 25 FIFTH ANNUAL REPORT FEDERAL RESERVE BANK OF PHILADELPHIA Reserve Position (Continued) (OOO's omitted) 1919 Gold held Total cash Net deposits Federal reserve note circulation Net liability Reserve ratio Contingent liability Aug. 1 8 15 22 29 $124,870 126.123 131.430 127.717 128.288 $125,192 126.357 131,620 127,987 128,463 $103,994 109.575 107.905 107,897 105.542 $203,665 204.697 208.136 208.527 212.752 $307,659 314.272 316.041 316,424 318,294 40.7 40.2 41.6 40.4 40.4 $38,250 24,750 17,970 16.990 20.930 Sept. 5 12 19 26 129.823 128.306 126,553 129,732 130.006 128.542 126.861 130,007 101.764 102.378 102.690 110,400 212,863 213.103 211,378 212,579 314.627 315.481 314,068 322,979 41.3 40.7 40.4 40.3 21.811 7,000 23.627 18.295 Oct. 3 10 17 24 31 128.490 131.852 133.719 130,969 134.800 128.731 132,118 133,958 131.122 135.026 103.339 109,087 112,779 111.283 115.902 213.801 216.987 219.271 216.396 216.293 317.140 326.074 332.050 327.679 332.195 40.6 40.5 40.3 400 40.6 17,625 9.850 19.410 12.815 23,447 Nov. 7 14 21 28 136.152 131,989 133,610 128.222 136,342 132.150 134.055 128.699 116.139 107,846 112.384 97.128 219.870 220.593 219.689 223.051 336.009 328.439 332.073 320.179 40.6 40.2 40.4 40.2 16.025 21.155 20.370 23.500 Dec 5 12 19 26 131,010 134,185 137.093 138,341 131,487 134,734 137.637 138.880 101,747 107.674 107,906 99,840 222,612 229.076 233.241 240.273 324,359 336.750 341,147 340.113 40.5 40.0 40.3 40.8 24.350 14.900 21.100 27.615 FIFTH ANNUAL REPORT FEDERAL RESERVE BANK OF PHILADELPHIA rEDERALRESERVEBANKOFFMLADELPMIA NET DEPOSIT LIABILITY, fiR. NOTE CIRCULATION\ CASH RESERVES. AMD RESERVE RATIO. 1913. RESERVE RATIO, (PERCENTAGE OfC+L ) . DEPOSITAIWFR.riOTELIABILITIES,*, AND TOTAL RE5ERVES;C\ JAN. fTB. MCfi APRL\MAryumjULYAUG. SEPT, OCT. NOV. DEC. FIFTH ANNUAL REPORT FEDERAL, RESERVE BANK OF PHILADELPHIA Discount Rates The discount rates established early in 1918 were continued in force until November 6, 1919. In April of this year a rate was quoted on collateral notes of member banks and rediscounts secured by bonds of the War Finance Corporation. This latter rate was set at 1 per cent above the rate prevailing on commercial paper of the same maturity, as required by section 13 of the War Finance Corporation Act. On November 6 a schedule of rates was put into effect which, in the main, removed the differential in favor of collateral notes of member banks and paper of short maturities. Further advances were made on December 16, at which time the rates on loans secured by Government securities (with the exception of certificates of indebtedness) were advanced to the level of the rates on commercial paper. Discount Rates—Changes during 1919 RATES IN EFFECT Jan. 1.1919 Apr. 11.1919 Nov. 6. 1919 Dec. 16.1919 Jan. 1. 1920 Member banks' collateral notes: Secured by bonds or notes of the United States. Secured by AVl% certificates of indebtedness. .. Secured by 4%% certificates of indebtedness. . . Secured by War Finance Corporation bonds.... Secured by commercial paper Rediscounts: Secured by bonds or notes of the United States: 15 days and less 16 to 90 days Secured by 4%% certificates of indebtedness: 15 days and less 16 to 90 days Secured by 4'/*% certificates of indebtedness: 15 days and less 16 to 90 days. Secured by War Finance Corporation bonds: 15 days and le*» 16 to 90 days Commercial paper: 15 days and less 16 to 90 days , Agricultural or live-stock paper: 15 days and less 16 to 90 days 91 days to 6 months , Trade acceptances: 15 days and less 16 to 90 days 4'/2 41/4 53/4 43/4 4 4 4'4 4 4', 4 4 4'/4 4 41 4 5 5% 4 4 4»/ 4 4% b 4 4J,i i 4'4 4% 5 4 ,4 41 z 4VS 4JA 4V5 4/4 4V4 4'/2 5'4 V. 4 53,4 53,4 4^ 4'4 4<4 f> 4% 4% 4% 4K 4V2 4J4 4% 4 4'4 ?" 4 4»/J 4»/ 4 4'4 4'« Loan and Discount Operations The loan and discount operations were influenced chiefly by the fiscal operations of the Treasury. Including the Victory loan and the various issues of loan and tax certificates there was placed in the Third District more than $1,000,000,000 of Government securities during the year. The banks not only bought extensively of the certificates themselves, but they encouraged other purchasers and particularly so in the case of the Victory loan. They became well loaned-up and in order to meet commercial demands they made free use of the rediscounting privilege. FIFTH ANNUAL REPORT FEDERAL RESERVE BANK OF PHILADELPHIA The applications for loans received were far larger than in 1918 and increased steadily as the year progressed. Note obligations made up the bulk of the investments. Very little commercial paper was offered for rediscount to maturity till the last months of the year, the banks preferring to make use of the so-called "rediscount under agreement to repurchase," whereby they could secure advances for 15 days at the 15-day rate. The extensive use that was made of short-term borrowing served to swell the totals of these operations. The following table shows loan and discount operations with comparisons of the monthly figures for 1918: Loan and Discount Operations Bills Bills bought in open market QlStOUPlCQ 1919 member banks repurchase agreement certificates of indebtedness $2.600 $10,736,435,270 $ 14.048,447 $ 2.000 29.978,9 50 120.008,026 1.857.642.720 $52,919,500 37.193.100 $10,803,405,217 April May June July \ugust.. .. September. October. . . November December. $883,389 1.541,652 1.828,063 1,918,791 534.512 134.911 278.963 509.731 687,216 220,704 2,832.489 2.678.026 accommodated 1918 $686,466,137 643,150.003 839.369.743 920.617.048 947.513,540 1,088.293.030 1.034.505.183 925,992.017 1.020,490,694 1.155.157,238 689.812.281 852,038,303 $683,722,748 640.608.351 832.991.680 916.038.257 945,479.028 1.079.576,619 1.032,074.220 922.775.286 1.003.715,978 1.151,792,034 683,636.792 844.024.277 Member 1919 $1,860,000 1,000.000 4.550.000 2,660,000 1.500,000 8.579.500 2.152,000 2.707,000 16.087,500 3.144.500 3.343.000 5,336.000 January.-. February.. March 1919 1918 Totals United States Purchases of •$51,165,270 47.069.569 53,562.290 61.161.415 85,531,841 106.877.251 140,269,124 165,420.383 167.232.191 271.122.400 379.220,590 516,200.472 351 322 341 346 391 432 413 389 388 389 375 405 •$2,044,832,796 494 457 * Includes $10,000 of municipal warrants The average daily earning assets of the Bank advanced steadily up to the end of the year. In December the average was $243,809,000, as compared with $197,818,000 in December, 1918. The following tables show the average daily holdings of the several classes of earning assets for each month and for the year 1919, and their movement by weeks during the year. Earning Assets—Average Daily Amount Totals 1919 BiUs discounted Bills bought United States securities 1919 January February... March April May une uly August September. October November. December. , $177,059,450.14 185.697.841.68 187.159.834.64 188.689.151.27 192,374.941.88 192.524.439.20 188,589,796.09 193.261.631.98 196.612.073.97 204.075.940.90 205.069.357.06 206.825.891.82 $2,872,846.65 Average 1919. Average 1918. $193,194,965.26 75,556.041.00 J 632.484.23 1.394.053.71 4.442.339.33 $11,812,254.84 12,631.828.57 15.524.916.13 18.347.500.00 20.312.496.77 23.215.560.00 25.307.774.19 27.337,016.13 29.304,400.00 30.431,803.22 31,663.083.33 32.541.238.71 $191,744,551.63 200.562,223.49 204.604.528.82 208,440.030.89 213.595.405.82 216.680.799.42 214.600.141.74 221.288.397.80 226.759.699.84 235.140.228.35 238,126.494.10 243.809.469.86 $ 1.581.246.87 18,375,123.00 $23,262,739.72 7.135.005.00 $218,038,951.85 2.232.553.24 1,919.778.05 1.403.378.62 907.967.17 940.800.22 702.571.46 669.749.69 845.225.87 •Small amount of municipal warrants included 1918 '$56,592,574.00 53.576.334.00 58.196.659.00 63.680.78200 69.155.715.00 77.315.535.00 88,626.133.00 102.304.319.00 114.640.100.00 138.135.408.00 189.486.768,00 197.818.495.00 $101,067,237.00 FIFTH ANNUAL REPORT FEDERAL RESERVE BANK OF PHILADELPHIA Movement of Principal Earning Assets During the Calendar Year 1919 (In thousands of dollars; i. «., 000's omitted) Discounted paper secured by United States war obligations 1919 Pt *£f Bills b o u g h t in mtTet Total bills I T - , . discounted g t ' t boSt « « - Total earning assets $177,319 171.990 169.068 187.873 171.388 89.2 90.9 90.8 91.6 91.2 $3,401 3.072 2.770 2.571 2.133 $180,720 175.062 171.838 190.454 173.521 $11,418 11,243 11.243 12.211 12.185 $192,138 186,305 183.081 202.665 185.706 2\'.'.'.177.360 176.990 28... 13.175 14,291 12,168 13.081 181.361 191.913 189.528 190.071 92.7 92.6 93.6 93.1 2,153 2,274 2,116 1,987 183,514 194.187 191.644 192.058 12.165 12.665 12.665 13.166 195,679 206,852 204.309 203.118 178,463 178,171 169,255 172.914 9.331 11,536 13.620 12,375 187.794 189.707 182.875 185,289 95.0 93.9 92.5 93.3 1,658 1,332 2.291 2.270 189.452 191,039 185,166 187.559 13.666 15,165 16,665 16,715 203.118 201,831 201,831 204.274 25... 169,249 174.204 166,448 182.169 13.182 13.186 14.688 9.501 182,431 187,390 181.146 191.670 92.7 93.0 91.9 95.0 3.192 1.021 914 826 185.623 188.411 182.050 192.496 17.741 17.666 18.665 18.661 203.364 206,077 200,715 211.157 2... 9. .. 16... 23... 29... 180.939 178.113 182.468 170,315 183.577 11.759 12.240 13,408 12,378 13.012 192.698 190.353 195.876 182.693 196.589 93.9 93.6 93.2 93.2 93.4 691 930 922 918 1,113 193.389 191,283 196,798 183.611 197.702 19,645 20.075 20,075 21.075 21.075 213,034 211,358 216.873 204,686 218,777 • £ . .160.810 191.277 17!'.'. 24... 31... February 7.. . March 7. . . 14... 21... 28... 4... 18^! May^ June (1 + 2) $19,065 15,613 15,518 15.673 15.036 3... $158,254 January April Other discounted paper 156,377 153,550 172,210 156.352 168.186 177.622 20... 27.. 176,588 173,957 13.900 14.389 18.254 17.229 174,710 205.666 194.842 191.186 92.0 93.0 90.6 91.5 972 969 864 860 175,682 206.635 195.706 192.046 27.065 22,070 23.066 23.248 202.747 228.705 218.772 215.294 3... 18... 25... 170.753 173,697 165,015 170.366 17.852 15,679 19.557 19,881 188.505 189.376 184.572 190.247 91.0 91.7 89.4 89.5 711 631 759 719 189,216 190,007 185.331 190.966 24.236 25.231 25.178 26.198 213.552 215.238 210.509 217,164 1... 8... 15... 22... 29... 175,349 180,934 176.779 180,285 180.872 15.830 14.715 16,044 17.192 16,486 191.179 195.649 192.823 197.477 197.358 92.3 92.5 91.6 91.3 91.7 660 623 673 812 762 191.839 196,272 193,496 198,289 198,120 26,198 27.248 27.190 27.287 28.625 218.037 223.520 220.686 225.576 226.745 \9... 26... 175,974 179.199 173.229 180.151 16,830 15.985 21.528 21.705 192,804 195.184 194.757 201.856 91.3 91.8 88.9 89.2 843 1.061 811 735 193,647 196.245 195.563 202.591 28.566 28.616 30,054 29.567 222,213 224.861 225,622 232,158 October 3... 10... 17... 24.. 31... 175.243 182,038 181,508 182,789 181,590 21.290 21,418 25,061 23.252 25,580 196.533 203.456 206.569 206.041 207.170 89.2 89.5 87.9 88.7 87.6 645 645 618 601 656 197.178 204.101 207,187 206.642 207.826 30.067 30.178 30.567 30.573 30.687 227,245 234.279 237.754 237,215 238.513 November 7. .. 14... 21.. 28... 186,560 182,962 188,259 185.583 23.415 20.894 18.399 12,684 209,975 203,856 206.658 198,267 88.8 89.7 91.5 93.6 1.297 1.444 3,135 210,862 205.153 208.102 201.402 30.600 32.431 31,746 32.856 241,462 237,584 239.848 234.258 5. . . 12... 19 26... 184.407 193.337 177,655 178,648 15,028 14.673 27.154 29,492 199.435 208.010 204.809 208.140 92.5 92.9 86.7 85.8 3,649 4,705 4,704 4.698 203.084 212.715 209.513 212.838 33.145 32.303 32.519 31.914 236.229 245.018 242.032 244,752 July August September December 5.. . 10 FIFTH ANNUAL REPORT FEDERAL RESERVE BANK OF PHILADELPHIA JAN FE6 MAR APR MAY JUNE JULY AUG 5EPT OCT NOY DEC DOLLARS U.5.SECURITIES 40 20 40 10 DILLS BOUGHT 40 20 40 20 REDISCOUNTS OF COMMERCIAL PAPER 200 160 160 M0 120 100 80 60 40 20 .,•** \ * ^ 200 180 160 140 120 100 80 60 40 20 B I L L S DISCOUNTED SECURED BY U.5. GOVERNMENT OBLIGATIONS 260 240 220 200 180 160 HO 120 100 80 60 40 20 0 £60 8(0 220 200 160 160 140 120 100 60 60 40 eo 0 TOTAL EARNING ASSETS EARNING A 5 5 E T 5 AVERAGE DAILY AMOUNT ON HAND- i9is-T9i9 SECTIONED AREA = 1919 DOTTED LINE = 1918 11 J FIFTH ANNUAL REPORT FEDERAL RESERVE BANK OF PHILADELPHIA The earnings from loans and discounts were $8,550,000, as compared to $4,230,000 in 1918, though the average rate of return was only 3.9-1 per cent as compared to 4.19 per cent in 1918. United States securities afforded an average rate of return of only 2.13 per cent as compared to 3.27 per cent in 1918, but this is accounted for by the large proportion of one-year certificates of indebtedness of the United States, yielding 2 per cent, which were held to secure Federal reserve bank notes. Last year United States bonds formed a considerable percentage of the total amount of United States securities held. The following tables give the earnings and average annual rates of earnings from the various classes of earning assets: Earnings from Loans and Discounts for the Calendar Year 1919 1919 Bills discounted Bills bought in United States securities Total earnings 1919 1918 January February.... March April May June July August September.. October November.. December. . $620,820.01 584.112.76 652,763.12 635,409.30 663,748.96 646.815.40 647,164.44 660,546.70 651,312.33 698.352.36 727.252.52 799,565.64 $10,737.25 7,278.95 6,805.96 3,603.11 3,067.39 3,314.72 2,546.22 2.486.79 2.944.39 2,305.39 4.989.45 16.939.% $22,273.80 21.432.76 28,494.10 32,862.03 36,612.65 40,532.58 45.437.92 48.837.87 50,316.95 53,919.07 55,854.11 59.193.88 $653,831.06 612.824.47 688.063.18 671.874.44 703.429.00 690.662.70 695,148.58 711.871.36 704.573.67 754.576.82 788.096.08 875.699.48 Totals, 1919 Totals, 1918 $7,987,863.54 3.241.104.00 $67,019.58 756.313.00 $495,767.72 233.489.00 $8,550,650.84 $181,212.00 158.443.00 194.085.00 212,439.00 239,501.00 267.264.00 321.741.00 365,628.00 407,492.00 506.544.00 691,796.00 684,810.00 $4,230,955.00 Calculated Annual Rates of Earnings from Loans and Discounts 1919 January February March April May June July August September October November December Averages. 1919 Averages, 1918 Bills discounted Bills bought in United States securities Averages 1919 2.22* 2.21 2.18 2.17 4.01* 2.12 2.12 2.06 2.08 2.08 3.87 3.87 4X3 4O3 4.02 4.31 4.55 4.40* 4.25 4.17 4.07 3.97 4.28 4.26 4.24 4.24 4.29 4.35 4.48 4.13 4.29 4.23 4.12 2.13 3.27 4 12* 4.10 4.10 4J)9 4 Of, 4.U8 4-04 2.08 2.14 2.14 3.98 3.96 3.92 3.81 3.78 3.78 3.77 4.02 4.22 1918 3.77* 3.85 3.92 4.05 4.07 4.20 4.27 4.20 4.32 4.31 4.32 4.18 3.94 4.19 FIFTH ANNUAL REPORT FEDERAL RESERVE BANK OF PHILADELPHIA Bills Discounted Total bills discounted during the year amounted to $10,736,435,000; in 1918 this total was $1,857,642,000. The number of banks accommodated this year was 494. Notes secured by United States Government obligations formed a very large proportion of the investments of the Bank. On the last Friday of December the ratio of paper secured in this manner to total discounted paper was 86 per cent of the total paper under discount, as compared to 89 per cent on the corresponding Friday in 1918. The increase in discount rates on short term paper early in November caused many of the banks to decrease their presentations of collateral notes and substitute in their stead their customers' paper secured in like manner. Notes secured by War Finance Corporation bonds were discounted in small amount. Until the end of the year the commercial paper presented was inconsiderable, but the increased rates on Government-secured paper instituted in December resulted in larger offerings. Bankers' and trade acceptances played an unimportant part in the discount operations of the year and did not form a total at all comparable to that of 1918. Due to the industrial predominance of the district, agricultural paper was offered only in small amounts. Total discounted paper held at the end of the year was $209,854,000; at the end of 1918 the figure was $178,819,000, thus indicating an increase of 17 per cent during the year. Bills Discounted Held by Bank (Figures as of last Friday of each m o n t h ) Secured by United States war obligations 1919 Member banks' collateral notes January February March April May June July August September October November December $131,955,955.95 147.161,890.94 144.812,710.20 162.662.152.05 169,125,762.05 156.006.837.05 157,546.125.00 166.602,305.00 168.485,933.43 164.465.571.66 104,122.516.66 97,260.916.66 Non-member banks' paper endorsed by members $2,094,000.00 3.344,000.00 2,771.000.00 2.943,000.00 1.190.000.00 1.188.000.00 11.822,262.59 1,062,000.00 618.000.00 838,000.00 9.043.400.00 10,250.150.00 13 All other bills $22,302,026.85 26.483,817.20 25,329.861.25 16,563.699.34 13.261.579.39 16.761,988.44 998,000.00 13,206.530.75 11.047.639.43 16.286.545.59 72.417.423.17 71.137.244.35 Member banks' collateral notes secured by War Finance Corporation bonds $35,000.66 28.000.00 20.500.00 40,000.00 3.000.00 3,000.00 FIFTH ANNUAL REPORT FEDERAL RESERVE BANK OF PHILADELPHIA Bills Discounted Held by Bank (Continued) Otherwise secured and unsecured 1919 March . April May.... $384,739.97 345.182.35 438.046.85 450,931.65 368.894.09 344.076.99 266.024.90 303.349.13 407.100.93 598.681.73 1.102.630.13 1.172.317.97 $ 20.000.00 20.000.00 20.000.00 576 894 47 July August September October November December All other bills Trade acceptances Bankers' acceptances 18.869.75 18.869.75 18.869.75 $14,650,751.04 12.737.826.04 11.919.517.35 9.029.908.46 12,588,214.01 16,280.657.80 19.594.652.62 16.123.983.66 21,276,085.41 24.962,548.14 11,578,705.09 28.319.793.95 Totals 1919 $171,387,473.81 190.070.716.53 185.289.135.65 191,669.691.50 196,589.449.54 191,186.454.75 190.247.565.11 197.358.038.29 201.856.628.95 207.170.216.87 198.267.675.05 208.140.422.93 Open Market Operations The open market operations of this Bank during the past fiscal year were practically negligible. The demands on its resources through the discount of paper offered by member banks precluded the investment of large sums in paper to be purchased elsewhere. Bankers' acceptances in foreign transactions formed the major portion of such investments. Dollar exchange bills were bought only in the first two months. Total operations under this heading for the year were $14,048,000; in 1918 they were $120,008,000. The following table shows the bills purchased in the open market held by the bank on the last Friday of the months specified: Bills Bought in the Open Market (Figures as of last Friday of each month) Bankers' acceptances 1919 Foreign January.. February.. March. . . . April May June July August.... September October.. . November December. $1,022,257.07 826.629.03 817.348.66 525.023.25 727.523.61 600.571.84 620.142.72 572.619.02 452.549.81 429.434.05 2.296,210.44 3,575,043.21 Dollar exchange bills Trade acceptances $250,000.00 100.000.00 $20,526.00 20,526.00 Totals Domestic $ 840,300.78 1.040,449.57 1,452,310.45 301.447.72 381.598.77 255.668.48 95.040.21 189.464.36 282.290.85 226,295.67 838.507.67 1.122.711.63 3.485.16 3.485,16 3.485.16 $2,133,083.85 1.987.604.60 2,269.659.07 826.470.97 1.112.607.54 859.725.48 718.668.09 762.083.38 734.840.66 655,729.72 3,134,718.11 4.697,754.84 Earnings and Expenses As was to be anticipated from the reports made from time to time as to the activity of business, the operations of the Federal Reserve Bank of Philadelphia during the year 1919 were very much larger than for the previous year. Total earnings for 1919 were $8,609,000 and current expenses were $1,775,000, leaving net earnings of $6,834,000. The net earnings were 89 per cent of the average capital stock for the year, as compared to 46 per cent in 1918 and 12 per cent in 1917. 14 FIFTH ANNUAL, REPORT FEDERAL RESERVE BANK OF PHILADELPHIA After the deduction of the reserve for depreciation on United States securities and other sundry purposes, the net amount available for dividends and surplus was $6,659,000. Dividends at the rate of 6 per cent were paid for the year and $6,196,000 was transferred to surplus fund, bringing the total of that fund up to $8,805,000, or approximately 111 per cent of the paid-in capital stock at the end of the year. Schedules follow showing the profit and loss account and earnings and expenses by months : Profit and Loss Account Cross earnings for year 1919. Total of current expenses. . . Net earnings for year $8,609,879.77 1.775.184.67 $6,834,695.10 Net debit to profit and loss account Reserved for depreciation on United States securities and sundry purposes. 42,086.49 133,439.73 175,526.22 Net amount available for dividends and surplus $6,659,168.88 Dividends for period January I, 1919 to December 31, 1919. Transferred to surplus fund 462.380.31 6,196.788.57 $6,659,168.88 Surplus Account Balance at close of business December 31, 1918 Transferred March 4, 1919, from account "Reserved for Franchise Tax" Transferred from profit and loss account $1,304,171.92 1,304.171.92 6.196,788.57 $8,805,132.41 Earnings and Expenses EXPENSES EARNINGS From investments 1919 January... Februar) March. April . . Vlay... June... July... August. September. October... November. December. Totals: 1919... 1918... Deficient reserve Sundry penal- profits ties $653,831 612.824 688.063 671.874 703.429 690.663 695.149 711,871 704,574 754,577 788,096 875.699 $2,449 2,087 1.184 1,169 1,147 1,624 1,307 3.348 1.430 3.378 3.417 3.133 $8,550,650 4,230.955 $25,673 29.784 $1,890 1,534 1.725 1.772 1.685 10,409 6.228 3,739 1.222 •1.273 2,117 2,507 Total earnings $658,171 616.446 690.972 674,815 706,261 702,6% 702.684 718,959 707,226 756,681 793.629 881.339 Note Expenses issues Equipof opera- and ship- ment, etc. ments tion $63,887 $12,767 4,454 89.080 18.755 91.662 5.428 80.356 5.927 77.800 176.863 105,222 13.201 89,621 12.987 87,0% 11.995 89.427 13,440 87,140 11,540 89,726 220.916 153,914 $2,357 1.072 7.435 6.135 863 65.931 18,549 8.031 789 1.418 1.318 48.081 $33,555 $8,609,879 $1,243,574 $369,630 $161,979 628.016 243.857 215,042 97,000 4.357.740 Total current expenses Net earnings Annual rate of earnings $579,159 521.839 573.122 582.895 621.670 354.680 581.313 610,844 605,015 654,683 691,046 458.429 90.0 90.3 89.0 93.4 96.2 56.6 89.4 93.5 94.9 99.2 107.0 68.4 $1,775,184 $6,834,695 1.086.916 3.270.824 89.0 46.0 $79.011 94.606 117.851 91,920 84.591 348.016 121.370 108.115 102.211 101,998 102,584 422,911 •Loss. A chart of total earnings and expenses during the last three years is given below. It is apparent that the net earnings of the last fiscal year have been extraordinarily large. Total earnings show unusual increases, and total expenses have consumed only 21 per cent of them, as compared to 25 per cent in both 1918 and 1917. In viewing the earnings for the year, it should be borne in mind that a large part of the loaning power of the Bank is derived from its note issuing privilege, a function conferred by the Government. Had its power to extend credit depended entirely upon its deposits and 15 FIFTH ANNUAL REPORT FEDERAL RESERVE BANK OF PHILADELPHIA capital, the Bank would have been of comparatively* little aid to the business community, but through its note issues, which averaged $212,000,000 for the year and were approximately twice the average deposits of member banks, it was able to serve the community as it did. I EARNINGS AND EXPENSES-1917.1918,1919 >fe I^B1=TOTAL EXPENSES V///A = TOTAL EARNINGS 16 FIFTH ANNUAL REPORT FEDERAL RESERVE BANK OF PHILADELPHIA Comparative Statement of Condition RESOURCES Cold Cold Gold Cold Gold with Federal reserve agent redemption fund settlement fund coin and certificates with foreign agencies Collateral notes—members Bills discounted—members Bills bought in open market United States securities Total earning assets Federal reserve notes on hand Federal reserve bank notes on hand Mutilated Federal reserve notes Redemption fund—Federal reserve bank notes Due from depository banks—war loan account TOTAL RESOURCES LIABILITIES Capital Government deposits Due to member banks, reserve account Collection items, etc Federal reserve notes outstanding Federal reserve bank notes outstanding Government deposits—special account All other liabilities TOTAL LIABILITIES Dec. 31. 1919 Dec. 31, 1918 Dec. 31, 1917 $88,948,165.00 8,448,460.00 31,678.751.93 1,194,040.00 10,505.616.91 589,111.05 $85,583,245.00 7,900.000.00 37,412.406.54 1.459.351.21 1.667.646.00 $63,945,755.00 1.500.000.00 32,101,000.00 19,064,667.50 3,675.000.00 1.189.996.10 $141,364,144.89 $134,022,648.75 $121,476,418.60 87,908,591.66 121.946,370.40 5,177.538.86 32,071.900.00 135.032.810.41 43,787.151.29 3,011,280.08 11.417.900.00 4.008,400.00 31,903,836.94 18,390.067.91 9.649,950.00 10.000.00 $247,104,400.92 $193,249,141.78 $63,962,254.85 9,677,915.00 260,249.00 1,167.100.00 1,475,000.00 43.175.744.75 92.970.730.85 1.191,987.61 11,739,400.00 332.037.00 1,019.340.00 475.000.00 4.348.590.00 90.852.687.70 1.378.783.06 22.620,777.40 265.919.66 $538,387,273.02 $433,069,038.29 $212,674.169 60 Dec. 31. 1919 Dec. 31. 1918 Dec. 31. 1917 209.09 $7,884,150.00 8,805.132.41 $7,562,450.00 1.304,171.92 $6,142,150.00 5.188,851.06 110.541.160.68 79,115,484.23 5!039J28.i7 99,720,124.95 66,740.374.64 220,238.27 5.387.488.53 103.000,930.13 435,026.66 $194,845,495.97 $171,499,627.76 $108,823,445.32 247.895.665.00 29,052,000.00 49,051,497.75 853.331.89 241,870.745.00 9.258.200.00 97.325.755.00 1.573.843.61 162.581.01 $538,387,273.02 $433,069,038.29 $212,674,169.60 17 FIFTH ANNUAL REPORT FEDERAL RESERVE BANK OF PHILADELPHIA BILLS DISCOUNTED 4-1 % ASSETS \ UNCOLLECTEO 7% BILLS DISCOUNTED 39 % A55ET5 1918-*433.0fe9,000 1919-5533,387,000 IS FIFTH ANNUAL REPORT FEDERAL RESERVE BANK OF PHILADELPHIA FEDERAL "RESERV BANK NOTES COLLECTIO ITEM5 15 K FEDERAL RESERVE _ N0TE5 MEMBER BANK DEPOSITS CAPITAL ANO ^ SURPLUS -$* COLLECTION ITEMS 15% OTHER LIABILITIES 10 v. FEDERAL RESERVE AIOTES 4-6 MEMBER BANK DEPOSITS 21 % LIABILITIES I919~»538,387,000 !9i8-*433,069,000 19 FIFTH AXXUAL REPORT FEDERAL RESERVE BANK OF PHILADELPHIA Federal Reserve Notes The circulation of Federal reserve notes fell off very noticeably during the first few months of the year and attained a low point of $200,498,000 on June 21. The chart facing this page shows the general trend during the past three years. The decrease in the begining of 1919 can be traced to the falling off in business. The increased activity which began early in the year was reflected in larger circulation in August, and a steady increase in such issues continued until almost the end of the year. The maximum amount of notes ($241,348,000) was in circulation on December 24, as compared to the former high level of $235,586,000 on December 26, 1918. Immediately after Christmas the notes began to return in large amounts. A statement of the accounts of the Federal Reserve Agent at the close of the fiscal year 1919, with comparative figures for 1918 and 1917, follows: Comparative Statement of the Federal Reserve Agent's Accounts RESOURCES Dec. 31. 1919 Dec. 31. 1918 Dec. 31.1917 Federal reserve notes on hand Federal reserve notes outstanding Federal reserve notes sent to Comptroller of Currency for destruction Bills to secure Federal reserve notes Funds to redeem Federal reserve notes: Gold coin and certificates on hand Gold redemption fund Gold with Federal Reserve Board Total. Total resources. $ 21.340,000 $ 17,640.000 247,895.665 241,870,745 241,544.335 64,909,255 165,192.017 159,787.038 $10,160,000 97.325.755 17,994,245 34.855.506 14,558,905 74.389,260 13.296.465 72.286,780 4,220.000 4,966.755 54,759.000 88,948.165 85,583.245 63.945.755 $764,920,182 $569,790,283 $224,281,261 LIABILITIES Federal reserve notes received from Comptroller of Currency (gross) Collateral received from Federal Reserve Bank $510,780,000 $324,420,000 $125,480,000 254.140,182 245.370,283 98.801,261 $764,920,182 $569,790,283 $224,281,261 Total liabilities. Federal Reserve Notes Issued and in Actual Circulation 1919 Outstanding at beginning of month Issued during month Fit notes received Redeemed Outstanding Held by Bank at end of at end of month month In actual circulation at end of the month 1919 Jan... $241,870,745 Feb... 217,669,325 Mar.. 222.893,735 April. 214.491.300 May.. 214.345.050 June.. 215.791.395 July.. 213.247.745 Aug.. 215.657.960 Sept... 220.389.135 224.916,405 Oct... Nov.... 232,327.085 233.829.950 Dec.. $ 1.250.000 18.290.000 5.900,000 14,240.000 20.240.000 17,200.000 17,800.000 21,900.000 19.400.000 22,300.000 12.500.000 24,640.000 $13,000,000 $12,451,420 $217,669,325 13.065.590 222.893.735 14,302.435 214.491.300 14,386,250 214,345.050 18,793.655 215,791,395 19,743.650 213.247,745 15.389.785 215.657.960 17,168,825 220,389.135 14,872.730 224.916.405 14.889.320 232,327.085 10,997,135 233.829.950 10,574.285 247.895.665 20 1918 $ 7,748,765 $209,920,560 $ 92,003.655 12,125.815 210.767,920 104.219.060 8.582,550 205.908.750 115,311.370 10,451.002 203.894.048 121.814.448 9.520,990 206,270.405 134,459.425 9.690,620 203.557.125 147.646,035 12.336.825 203.321.135 164.747,585 6,832.005 213.557.130 185.594,395 12.071.570 212.844,835 200.426.030 16.034.490 216.292.595 216.125.610 10.303.865 223,526.085 226.690.915 10.845.015 237.050.650 229,112.005 J F / A A / A J J A S O N D l J F M A M J J A S O M D J F / A A M J J A S O N D FEDERAL RESERVE NOTES IN ACTUAL CIRCULATION FIFTH ANNUAL REPORT FEDERAL RESERVE BANK OF PHILADELPHIA Notes of the smaller denominations have been in greatest demand, with $10 and $20 notes forming the bulk of those issued to the Federal Reserve Bank. There has been very little call for notes of higher denominations than $100, though a reserve supply is maintained to care for any need that may arise. Fit notes returned by the Bank are not included in the table given below. Denominations of New Federal Reserve Notes Is«ued to Bank During 1919 Fives 1919 Twenties Tens Jan... Feb. . MarApril May. June. July. Aug. Sept. Oct.. Nov.. Dec $ 750.000 5,300.000 680,000 2.560.000 3,560,000 3,040,000 2.480,000 3.900,000 4,560,000 2,300.000 1,300,000 6.280.000 $2,610,000 2.120,000 4,200,000 5.520,000 3,800.000 6,680,000 7,760,000 4,880.000 7.760,000 2,960,000 8,160.000 $4,135,000 800,000 3.680.000 6,160,000 5.360.000 8,640,000 9.040,000 9.760.000 9,040.000 6.240,000 8,000.000 1919. Perct 1918. Prrrt $36,710,000 19.7 29,700,000 5.5 $56,450,000 30.3 53.960,000 28.2 $70,855,000 38.1 $89,600,000 46.8 Hundreds Fifties $1,200,666 1,200.000 1,800.000 600,000 $1,200,000 2,000,000 2.800,000 1,600.000 Five hundreds $200,000 Thousands $400,000 800,000 400.000 400.000 1.200.000 1,200.000 1.400.000 1,200,000 800.000 800,000 400.000 400,000 $ 8.600.000 4.7 12.600.000 6.6 $10,800,000 5.8 5.600,000 2.9 $600,000 .3 $2,000,000 1.1 Totals $750,000 12.045,000 4.8O0.0O0 14,240,000 19.240.000 16,400,000 18.400.000 21.500,000 19,200,000 22.300,000 12.500.000 24.640.000 $186,015,000 100.0 191.460.000 100.0 Interdistrict Movement of Notes Boston New York. . Cleveland Richmond Atlanta Chicago.... St. Louis Received from Returned to $ 4.370.700 47.221.750 10,451.000 7.180.750 1.874,200 3,906.900 1.123.805 $ 3.382.000 59.800.500 8.798.000 7,897.500 3.510.500 5,633.000 1.477.000 Received from Minneapolis Kansas City Dallas San Francisco Total. 1919 Total. 1918 Returned to 395,000 571.100 392,800 811.880 $ 1,068,500 1.452.500 512,500 993.050 $78,299,885 $39,501,305 $94,525,050 $62,354,660 $ 1 Federal Reserve Bank Notes Demand for notes of small denominations continued throughout he year, and was especially urgent in the month of December due to f he great activity in retail trade.The amount of notes in actual circulaion increased from $8,926,000 at the end of 1918 to $28,791,000 at ne end of 1919, or 223 per cent. Melting of silver dollars authorized v the Pittman Act was discontinued in May. Statistical tables on Federal reserve bank notes follow. FIFTH ANNUAL REPORT FEDERAL RESERVE BANK OF PHILADELPHIA Federal Reserve Bank Notes 1919 April . . . May July October December Outstanding at beginning of month $ 9.258.200 10.428.000 11 5% 000 14.944.000 16.928.000 19.068.000 21372.000 24 268 000 26,440.000 26 736.000 28.232.000 28.536.000 Issued during month $1,343,000 1.520.000 3,908.000 2.508.000 2.780.000 2.716.000 3.016.000 2 692 000 1.120.000 2.476.000 2.176.000 2.800.000 Redeemed $173,200 352.000 560.000 524.000 640.000 412.000 120.000 520.000 824,000 980.000 1.872.000 2.284.000 Outstanding at end of month $10,428,000 11.596.000 14.944.000 16.928.000 19.068.000 21.372.000 24.268.000 26.440.000 26.736.000 28.232.000 28.536.000 29.052.000 Held by Bank In actual circulation at end of at end of month month $ 110.750 285.237 379.507 414.104 432.548 452.405 356.444 1,157.648 378.249 478.848 589.234 260.249 $10,317,250 11.310.763 14.564.493 16.513.896 18.635.452 20.919.595 23.911.556 25.282.352 26.357.751 27.753,152 27.946.766 28.791.751 Federal Reserve Bank Notes Issued Or.? Twos Fives January.. . February.. March April May June July August September. October . . November. December. $ 564.000 1.208.000 1.728.000 1.900,000 2.120.000 1.848,000 1.224,000 1.892.000 836.000 1.996.000 1.800.000 2.128.000 $120,000 312.000 200.000 608.000 160.000 448.000 392.000 800.000 144.000 480.000 376.000 672.000 $ 659.000 Totals $19,244,000 $4,712.000 $5,099,000 1.980.666 500.606 420.000 1,400,000 140.000 Total $1,343,000 1.520.000 3.908.000 2.508.000 2.780.000 2.716.000 3.016.000 2.692.000 1,120.000 2,476.000 2.176.000 2.800.000 $29,055,000 Coupon Department The work of the coupon department has been more than triple that of 1918 in the number of items handled and their total amounts. Fourteen persons are now employed in this division. The number of items handled has run as high as 111,000 a day, and the amount has been in excess of $1,700,000. The distribution of the maturities of Government coupons over the various months of the year has created a steady demand on the services of this department. The total number of items handled during 1919 was 8,258,108, as compared to 2,728,361 in 1918. The value of these coupons during the last fiscal year was $47,063,622.79, in comparison to $11,736,022.64 in 1918. Monthly figures on the amount and number of coupons cancelled and shipped during 1919 are given herewith. FIFTH ANNUAL REPORT FEDERAL RESERVE BANK OF PHILADELPHIA Shipments of Cancelled United States Coupons Number Value 1919 1919 1919 January February March April May June J«ly August September. .. October November. . . December I Total.. 1919. Totals. 1918 341.208 101.277 793.130 1.136.616 973.181 572.025 301.186 155.076 638.086 $1,259,666.67 246.973.52 3.801,746.12 7,628,972.04 4.760,996.63 2.620,369.58 831.077.53 1,258.959 833.241 1.154,123 327.196.48 3.433.730.02 8,803.868.13 4,724.969.07 8.624.057.00 8,258,108 2,728.361 $47,063,622.79 11.735,022.00 Collection Department The work of the collection department was much larger than the previous year and increased during the year to a high point in December. No charges are made on items except the actual cost of postage, insurance, and registration on maturing coupons, bonds, and other securities attached to drafts sent for collection and 15 cents on items returned unpaid to member banks. A resume of the items handled during 1919 follows. A large portion of the collections is handled through the gold settlement fund, thus accounting for the differences between the total amounts of collections and the cash, checks and drafts received as shown in the following table: 1919 March April . . . May July October December Total* Number of items received for collection Number of items returned unpaid 211 185 168 179 167 250 158 246 362 484 438 2.607 1.851 1.882 2.181 2.322 2.409 2.763 2.918 3.485 4,059 3,734 5.081 615 35.292 3.463 Total amount of items received for collection Total amount of collections paid and credited Amount of actual cash handled in payment of collections Amount of checks and drafts handled in payment of collections No record No record No record No record $ 3.902,922.44 4,828.225.14 6.404.377.29 7.170.404.07 6.059.475.90 7.718.721.44 8.523.092.55 10,858.371.42 $3,313,908.52 2.252.319.53 3.751.735.29 2.375.840.51 3.440,087.72 2.774.844.87 3.119.066.31 4.235.229.44 5.478.612.78 6,600.510.70 6,094,393.85 8,253.581.88 $18,440.58 12,877.83 10.250.71 16.140.96 18.125.28 21.549.67 19.324.77 21.484.28 38.979.59 49.615.18 49.185.51 50.951.36 $1,588,241.82 489.342.41 1.244.561.99 351.457.14 930.979 92 735.138.18 1.135.577.58 1.954,186.32 1.578,675.22 1,991,739.20 2.363.104.30 2.792.531.00 Incomplete $53,690,331.40 $326,925.72 $17,155,535.08 23 FIFTH ANNUAL REPORT FEDERAL RESERVE BANK OF PHILADELPHIA Gold Settlement Fund The operations through the gold settlement fund were much larger than in 1918, record figures being reached in December of this year. Payments received through this fund totaled $7,630,713,000 in comparison to $5,440,137,000 in 1918, and the amounts paid to other Federal reserve banks were $7,636,447,000 as compared to $5,434,826,000 in the previous year. Monthly figures of total transactions and net gains and losses are given herewith. Gold Settlement Fund Operations 1919 January February.., March April May June July August September. October.... November. December.. Totals. Total receipts Total disbursements Net gain for month $540,841,853.46 442.545.830.12 552.989,646.51 588,564.726.77 586.259.043.37 663.859.290.47 749,478.311.91 629,054,373.65 689,470,979.68 725.326,327.67 684.462.903.98 783.594.223.03 $10,214,685.39 $7,630,713,856.01 $7,636,447,510.62 $25,341,652.55 $551,056,538.85 436,030.868.77 554.073.619 20 58o.400.307.17 583.586.131.08 673.526.475.96 741.545.305.75 629.658.805,30 681.569,283.81 727.159,603.27 678.574,592.09 785.532.324.76 Net loss for month $6,514,961.35 1.083.972.69 164.419.60 2.672,912.29 9.667.185.49 7i933.006.J6 604.431'.65 7i90l.695.87 r.833.275'60 5.888.311.89 1,938.101.73 Balances at close $47,627,091.93 41.112.130.58 42.196.103.27 42.031.683 67 39,358,771.38 49,025.956.87 41.092.950 71 41,697.382.36 33,795,686.49 35.628,962.09 29.740.650.20 31.678.751.93 $31,075,307.16 Transit and Clearings The transit department reports operations for the year on a much larger scale than in 1918. In dollars this increase is not so noticeable, the total value of all items handled this year being $13,843,000,000, as compared to $11,292,000,000 in 1918. In point of number of items handled, however, very large increases are reported, the number of items passing through the department being 34,886,768 as compared to 17,133,761 in 1918. This points to a considerable decline in the average amount of each item, and, as the tables which follow demonstrate, this is particularly true of such items as were drawn on Philadelphia banks. The department handled as many as 156,000 items in a day. The campaign to extend the par system to all banks in the district was rewarded with complete success. At the beginning of the year items were received without exchange charges by all member banks and all non-member banks with the exception of 115. Continual efforts were made to have these 115 institutions remit at par, and by July the number had been reduced to 46. Shortly before this time it was decided that, beginning July 1, this Bank would receive and collect all items at par, collections on institutions making exchange charges being handled through the express companies. Further efforts on the part of this Bank resulted in the bringing of all institutions into the collection system. The tables which follow show the total number and amounts of items handled and the daily averages by months. 24 FIFTH ANNUAL REPORT FEDERAL RESERVE BANK OF PHILADELPHIA Total Number and Amount of Checks Handled Monthly On Philadelphia banks On banks elsewhere in district On banks in other reserve districts Total 1919 Amount Number Jan.... Feb.... Mar... April.. May... June... July... Aug.... Sept... Oct.... Nov.... Dec.... 1919... 1918... 536.089 504,651 643.540 881,534 1.086.792 1,127.835 1.155,150 1,128,639 1.168,642 1,299,512 1,153,815 1,364.844 $704,657,161 583.438,785 717,606.959 638,917,287 695.116.725 730.558.427 757.265.867 704.683.625 845.110,979 850,916,400 779.371,298 900,028.864 Number 1,050,744 958,666 1,145.348 1.177,357 1,221,629 1,253,479 1.323,226 1,253,901 1,324.840 1,565,906 1,437,360 1.666.804 Amount Amount Number $142,887,606 118.609.517 150.109.944 153.582,154 156.985,289 174,188.000 187,674,318 176,602,670 210.203,714 216.385,122 201,888.858 240,083.975 12,051.043 $8,907,672,377 15.379.260 $2,129,201,167 6.655.028.275 8.569,393 1,263.933.879 4.256.167 532.101 514.178 585.568 603,235 549.510 567,320 614.513 596,547 635.602 739.9% 698.254 819.641 $251,170,421 199,052,797 220,261,439 220.084,737 211,690,433 229.640,928 248.584,951 228,493,695 238,436,056 252.443,980 252,068,043 254.943,339 Number Amount 2,118,934 $1,098,715,188 1,977.495 901,101.099 2,374,456 1.087,978,342 2.662,126 1,012,584.178 2,857,931 1.063.792.447 2,948,634 1,134.387,355 3,092.889 1,193,525,136 2.979.087 1,109,779,990 3.129.084 1.293.750,749 3,605,414 1.319,745,502 3,289,429 1.233,328,199 3,851,289 1.395.056,178 7.456.465 $2,806,870,819 34,886,768 $13,843,744,363 3.373,447.958 17,133.761 11.292,410.112 4.308,201 Average Daily Number and Amount of Checks Handled On Philadelphia banks On banks elsewhere in On banks in other reserve districts district Total 1919 No. Amount No. January February March April May June July August September.... October November December. . . . 20.618 20,186 25,743 35,262 43,472 45,113 46,206 45,145 46.745 49,980 46,152 54,594 $27,102,198 23,337,551 28.704.278 25.556,692 27.804,669 29.222.337 30.290,634 38,187,345 33,804.439 32,727,554 31,174,852 36.001,154 40.414 38.346 45.813 47,095 48.865 50,139 52,929 50,157 52.994 60.228 57,495 66,672 Average. 1919 Average. 1918 40.171 14.171 $29,692,241 22,095.528 51.264 28.458 25 No. No. Amount $5,495,677 4.744.380 6.004.397 6,143,286 6,279.411 6.967.520 7,506,972 7.064.106 8.408.148 8,322,505 8.075.554 9.603.359 20,465 20.567 23.422 24.128 21.980 22.693 24,580 23,861 25,424 28,461 27.930 32.785 $9,660,401 7.962,112 8,810,458 8,803,389 8.467.617 9.185.637 9,943,399 9,139,748 9.537,442 9.709.383 10.082.721 10.197.734 81,497 79,099 94,978 106.485 114,317 117.945 123,715 119,163 125,163 138,669 131,577 154,051 $42,258,276 36,044.043 43,519.133 40.503,367 42,551.697 45,375.494 47,741,005 54,391.199 51,750,029 50,759,442 49,333.127 55,802,247 $7,097,337 4.195.819 24.854 14.310 $ 9.356.236 11.208.640 116,289 56,939 $46,145,814 37.499.987 Amount Amount FIFTH ANNUAL REPORT FEDERAL RESERVE BANK OF PHILADELPHIA J FK A N J J AS OND J FMAM J J A 5 0 N D ITEMS ITEMS ITEMS ITEMS ON ON ON ON KEY ALL BANKS OTHER BANK5 IN PHILA DISTRICT PHILADELPHIA RANKS BANKS IN OTHER DISTRICTS TRANSIT DEPARTMENT OPERATIONS AVERAGE NUMBER OF 26 ITEMS HANOLEO DAILY FIFTH ANNUAL REPORT FEDERAL RESERVE BANK OF PHILADELPHIA Internal Organization Richard L. Austin, chairman and Federal reserve agent; Henry B. Thompson, deputy chairman; E. Pusey Passmore, governor; Edwin S. Stuart, deputy governor; William H. Hutt, deputy governor. Residence Name Class .1 Bank. Philadelphia, Pa. [Group I. A< Group 2. [Group 3. f Philadelphia, Pa. Dec. 31. 1920 Wilkes-Barre, Pa. Dec. 31, 1921 Clarks Green, Pa. Dec.31,1919 Group 1. Alba Johnson, vice-president, Southwark Foundry & Machine Co., PhilaRosemont, Pa. delphia, Pa. Group 2. Philadelphia, Pa. Edwin S. Stuart, merchant, Philadelphia, Pa. I Group 3. Charles K, Haddon, vice-president, Victor Talking Machine Co., Camden, Camden, N. J. N.j. Richard L. Austin. Henry B. Thompson, president, U. S. Finishing Co., New York City. Charles C. Harrison. Term expires Dec.31,1919 Dec. 31, 1920 Dec. 31. 1921 Philadelphia, Pa. Dec. 31.1920 Wilmington. Del. Dec. 31. 1919 Philadelphia, Pa. Dec. 31. 1921 Mr. R. M. Miller, jr., cashier of the Farmers and Mechanics National Bank of Phoenixville, Pa., and Mr. Frank W. Labold, of this bank, were elected assistant cashiers on May 1, and Mr. Samuel Earl, paying teller of the Bank, was elected an assistant cashier on December 18. Mr. R. D. Stockton was elected comptroller on January 2 and assumed office on February 1. The resignation of Mr. Thomas Gamon, jr., an assistant cashier of the Bank, was presented to the board of directors at the meeting of December 4 and the following resolution was adopted: "Whereas, Thomas Gamon, jr., an assistant cashier, since January 13, 1916, who came to this Bank as an employee in the early days of its establishment and therefore had an active part in the difficult task of organization, and the adoption of new methods for the proper handling of its business, has now tendered his resignation to accept an official position with the National Security Bank, in which he feels the opportunity will be broader and more remunerative; "Therefore, Be it Resolved, that his resignation be accepted as of December 31, 1919, with leave of absence during the interim, and with the assurance that he carries with him to his new work the cordial good wishes of the members of this Board." At the meeting of the board of directors on December 31, the officers were confirmed in their appointments for the coming year and Mr. Levi Rue, president of the Philadelphia National Bank, was again selected to represent the Third Federal Reserve District on the Federal Advisory Council. The terms of office of Mr. Michael J. Murphy, representing the group 3 banks as a class A director, and of Mr. Alba B. Johnson, rep 27 FIFTH ANNUAL REPORT FEDERAL RESERVE BANK OF PHILADELPHIA resenting the group 1 banks as a class B director, expired on December 31, and they were re-elected for terms of three years from January 1, 1920. The increase in the operations of the Bank has necessitated many additions to the clerical force. At the end of this year there were 627 employees and 15 officers, as compared to 419 employees and 11 officers at the end of 1918. The following table gives the number of persons in each department together with comparative figures for December 31, 1918: Department No. of No. of employees employees 1918 1919 Department No. of No. of employees employees 1918 1919 BANK BANK Telegraph Telephone Transit Vault Cafeteria Officers Analysis Auditing Bookkeeping Building (porters, charwomen) Chauffeurs Coupon Discount Federal reserve agent's Bank examination Filing Mail Miscellaneous Money Pages Printing Runners—guards Secretaries 3 3 186 7 15 3 3 103 3 0 554 335 GOVERNMENT Liberty Loan Government depository... Government check War loan organization War savings Capital Issues Committee 95 The increased operations of the Bank not only resulted in a larger personnel, but an increased need for space as well. About 75 per cent of the available room in its building is occupied by the Bank. The contemplated construction of a new vault in the basement of the main banking building made necessary the rental of the first floor of an adjoining building. The comfort and convenience of the clerical force has been considered as much as possible, and on July 8 a cafeteria was opened on the premises of the Bank with complete equipment furnished by the Bank. Meals are furnished at cost; its service has been satisfactory and has proved a physical and financial benefit to those connected with the institution. In connection with the Federal Reserve Club, a monthly magazine has been issued, and educational courses are being prepared. 28 FIFTH ANNUAL REPORT FEDERAL RESERVE BANK OF PHILADELPHIA General Business Conditions At the opening of the year the business outlook was uncertain and operations were still dominated by conditions incident to the ending of the World War. Cancellations of Government contracts and civilian orders, also, had a depressing effect. The inability of buyers and sellers to agree on prices resulted in a decrease in the volume of business and the appearance of some unemployment, which lasted for three or four months. However, the war had produced a shortage of many of the necessities of life and practically all of the luxuries. The people did not recognize the same necessity to curtail their purchases as in time of war and manifested a distinct tendency to buy clothing and other furnishings at any price which was requested. The comparatively low stocks of the retail establishments did not admit of sales in large volume without replenishment and manufacturers were given an increasing volume of orders. These conditions were particularly typical of the textile and house-furnishing lines. Personal wants were not the only needs that had not received full satisfaction during the period of active warfare. Manufacturing establishments had been compelled to forego many repairs and replacements which were urgently needed, and buildings of all types were scarce. The need for repairs, alterations, and new construction overcame the cautious purchasing policy which had been maintained early in the year and orders for iron and steel and their products, paints, building materials of all kinds, etc., increased very largely. The shipbuilding industries of the district were actively engaged during most of the year in completing the program of the Shipping Board. Toward the end there has been some slowing-up due to a lack of new business at prices which can be met here. The mining of anthracite coal, while not quite up to the levels of 1918, has been satisfactory and seems to be in ample volume to take care of the needs of domestic consumers. At the end of the year the majority of the business concerns of the district report orders on hand far in excess of the capacity to fill them. Business conditions generally, as far as demand and supply are concerned, are good almost beyond precedent. Skilled workers are scarce and the disinclination of operatives to do a full day's work is curtailing production. Prices of raw materials have kept pace with the extremely high prices demanded for manufactured goods, and the amount of capital required to conduct business has greatly increased, making necessary much larger lines of credit. 29 FIFTH ANNUAL REPORT FEDERAL RESERVE BANK OF PHILADELPHIA Banking Conditions in the District The boundaries of the district remain unchanged and include all of Delaware, that part of New Jersey south of the northern boundaries of Mercer, Burlington and Ocean counties, and that part of Pennsylvania east of the western boundaries of McKean, Elk, Clearfield, Cambria and Bedford counties. The total area is 36,844 square miles, making this the smallest of the Federal reserve districts territorially. The population at the last census was 6,632,611, or 6.4 per cent of the total population of the country at that time. At the end of the fiscal year our records show that there are 640 national banks and 453 state institutions, 38 of the latter class being members of this Federal Reserve Bank. The total net additions since January 1 to the list of national banks are 13, two of which are accounted for by the conversion of state banks into national banks. The total resources of all banks and trust companies in the district on November 15 was $3,011,090,000, of which the national banks totaled $1,741,542,000, or 58 per cent. Total resources in 1918 were $2,702,193,000, indicating an increase of 11 per cent during 1919. The table given below analyzes the figures compiled in greater detail by states. Banking Resources—District No. 3 (000's omitted) Capital Pennsylvania: National banks State institutions Total Surplus Undivided profits Individual deposits $966,054 806.804 546 371 $72,202 80.619 $104,433 119.354 $28,625 33.418 917 $152,821 $223,787 $62,043 $1,772,858 6,970 5,766 7.419 6.362 3.706 1,943 118 $12,736 $13,781 19 1.429 4.721 52 Bank deposits Total resources $112,398 $1,583,773 8.727 1,078,833 $121,125 $2,662,606 109.738 90.964 1.640 895 137.256 111.591 $5,649 $200,702 $2,535 $248,847 1,532 5.362 913 2,447 15,245 68.750 605 1,058 20.513 79.124 $6,150 $6,894 $3,360 $83,995 $1,663 $99,637 638 449 80.601 91.106 113.384 131.078 33,244 37.808 1.091.037 966.518 114.643 10.680 1.741.542 1.269.548 1.087 $171,707 $244,462 $71,052 $2,057,555 $125,323 $3,011,090 New Jersey: Total Delaware: National banks Total Total: National banks State institutions. .. Total FIFTH ANNUAL REPORT FEDERAL RESERVE BAXK OF PHILADELPHIA The capital and surplus of the member banks increased somewhat during the year. This increase amounted to $10,682,000 in the case of national banks in the district between the dates of August 31, 1918, and September 12, 1919. The borrowings of national banks on their bills payable increased very largely, and the percentage of these borrowings from the Federal Reserve Bank to total borrowings on such paper was 99 per cent in the fall of 1919, as compared to 95 per cent in the previous year. Comparative reports of the Comptroller of the Currency on the national banks of the district are as follows: Combined Statement of Condition of Member National Banks Date of Comptroller's call RESOURCES Sept. 12. 1916 Loans and discounts Liberty bonds and Victory notes. Other United States bonds Other bonds, securities, etc. AH other resources Totals. $597,371,000 Sept. I I . 1917 Aug. 31. 1918 Sept. 12. 1919 $647,542,000 23.903.000 67.804,000 283.356.000 316,206.000 $635,753,000 66.791.000 142,412,000 271,998.000 323,395.000 $843,965,000 58.812.000 244,462.000 295.338,000 $1,195,983,000 $1,338,811,000 $1,440,349,000 $1,808,247,000 $ 76,814.000 $ 76,708.000 99,037.000 28,766.000 25,071.000 $ 76.178.000 103,468.000 28,908.000 54.212,000 905.834,000 164.629,000 40.269.000 66.851.000 $ 79.368.000 110.960,000 33,960.000 54.561.000 1.043.787.000 161.220.000 165,694.000 158,697,000 $1,338,811,000 $1,440,349,000 $1,808,247,000 •327.390.000 289,274.000 347.618.000 LIABILITIES Capital stock Surplus Undivided profits National bank notes outstanding. Individual deposits Bank deposits Bills payable All other liabilities Totals. 97,304.000 24,460.000 56.291.000 759.894.000 166.926.000 1.042.000 13.252.000 $1,195,983,000 ' Includes all United States securities held 31 55.596.000 877.549.000 166.175,000 9.909,000 FIFTH ANNUAL REPORT FEDERAL RESERVE BANK OF PHILADELPHIA Member banks in Philadelphia, Scranton, Camden, and Wilmington for the past two years have been reporting to this Bank weekly some of the resource and liability items appearing in their statements. The figures given are for the last Friday in each month of 1918 and 1919. Member Banks in Camden, Scranton and Wilmington 1918 Loans Total A l l other United secured by loans and loans and States United investinvestsecurities States sements ments owned curities Reserve with Federal Reserve Bank Cash in vault Net demand deposits Time deposits Government deposits Number of banks reporting August. . . September October... November December. 34,882 53,890 74.820 96,634 77,459 66.427 77.633 89,504 114,169 153,014 114,415 106,426 25,560 22,527 21,488 21,213 35,849 38,543 42,571 44,245 45,796 160,091 170,278 157,618 615,270 603.004 600.504 611,090 633,752 630,130 601,371 609,794 620,941 621.928 620,611 619,529 675,712 679,421 696,812 728,937 747,060 735,100 721,575 743.543 780,906 935.033 905,304 883,573 59,446 58,607 53,562 57,349 54,591 53,300 50,060 55.311 65,596 68,969 66,412 58,120 22,490 21,974 19,771 20.419 20,469 19,841 18,974 18,617 19,479 20,867 21,053 25,612 567,847 569,913 566,712 587,163 575,703 564,865 553.158 584.633 628,748 606,679 615,753 629,478 15,506 15,876 15,578 14,965 13,796 14,427 15.246 14.311 16.391 15.987 15,801 18,972 28,585 40,099 34,863 43,756 70.865 76,313 17,359 32,066 25.742 30,179 27,910 31.235 46 47 47 49 49 49 49 50 52 53 54 5b 1919 January. . February. March.... April May une uly August. . . September October.. November December. 153.235 177,735 179,870 177.769 189,440 125,065 105,101 119,014 125,098 103,182 94,018 108.642 147,639 145.429 142,292 144.911 165.047 176.968 172.910 165,804 161,534 153,211 126,930 102,411 622,872 599,381 623.256 614,232 642,082 649,120 645,401 665,248 675,998 685.688 698,868 704,735 923,646 922,545 945,413 936,912 996,569 951,153 923.816 950,066 960,630 945,081 919,816 915,788 64.774 67,036 61.527 67,363 65.490 63,113 65,187 69,615 74,574 69,658 60,354 60,199 19.012 19.705 19,515 19,293 18,278 18,411 17,184 16,062 16,550 17,108 18,333 21,549 632,839 638,823 653.426 654,734 651.349 635.929 646,191 664,273 663.812 675.267 666,231 655,361 20,086 21.354 22.300 22,016 20,634 20.627 21.303 21.783 22.122 22,453 22,440 22,242 55,088 45,747 38,963 27.276 62,338 48,818 26.564 32,213 54.732 27.484 11,366 36.080 56 5b 5b 56 5b 56 5b 5b 56 56 56 5b January. . February. March April May June July J An analysis of the table discloses that the movements of the various classes of loans and investments reflect clearly the issuing of Government securities of various kinds. The peak of the United States securities owned was reached in May, 1919, while the high point in the loans secured by United States securities was reached in June. The reserves held with the Federal Reserve Bank averaged higher in 1919 than in 1918, but the amount of cash in vault was smaller. Deposits show a natural increase in keeping with the larger amounts of loans and investments. This table includes a larger number of banks in the year 1919 than in 1918, but the figures of the banks added to the list do not obscure the trends to any considerable extent. Toward the end of the period covered the banks reported their loans and investments in greater detail and these figures for December 26, 1919, are given herewith. 32 FIFTH ANNUAL REPORT FEDERAL RESERVE BANK OF PHILADELPHIA Amount United State* bond* to secure circulation Other United State* bonds, including Liberty bonds United States Victory notes United States certificates of indebtedness Total United States securities owned Loans secured by United States war obligations: (a) Liberty bonds (b) Victory notes (c) Certificates of indebtedness Loans secured by stocks and bonds other than United States securities All other loans and investments Total loans and investments Per cent $11,097,000 29.426,000 12,283,000 55,836,000 1.2 3.2 1.3 6.1 $108,642,000 11.8 $ 74.561.000 26.992,000 858.000 207,032,000 498.123,000 8.1 3.0 0.1 22.6 54.4 $915,351,000 100.0 Christmas savings funds have been conducted by many of the banks of the district. In response to a questionnaire sent out by this Bank, returns were received from 75 to 80 per cent of the banking institutions, and their reports indicate Christmas savings fund deposits of $9,789,000 in 1919, as compared to $8,174,000 in 1918. Increases in regular savings accounts were reported also. Fiduciary Powers Some of the national banks of the district appreciate the advantages of exercising fiduciary powers. The applications of 48 banks, permitting them to exercise full fiduciary powers, were approved during the year. The total number of banks in the district exercising full powers is now 59, and in addition, 38 others had been granted partial powers under the act as originally passed. The following table shows their distribution by states: Pennsylvania Totals 33 Full powers Partial powers Total 2 10 47 2 5 31 4 15 78 59 38 97 FIFTH ANNUAL REPORT FEDERAL, RESERVE BANK OF PHILADELPHIA The following map shows the locations of these banks in the district and emphasizes their wide distribution. National banks possessing such powers are located in 72 cities and towns of the district. Dots indicate the 72 towns and cities in which national banks possessing fiduciary powers are located. 34 FIFTH ANNUAL REPORT FEDERAL RESERVE BANK OF PHILADELPHIA Power to Accept up to 100 Per Cent No additions were made to the list of banks authorized to accept up to 100 per cent of capital and surplus during the past fiscal year. The following banks, all of which are located in Philadelphia, possess this power: Bank of North America First National Bank Girard National Bank Philadelphia National Bank Corn Exchange National Bank Fourth Street National Bank Market Street National Bank Tradesmens National Bank State Bank Members The pressure of other business has precluded the possibility of conducting an active campaign for the membership of state banks and trust companies during the last fiscal year. However, no opportunity has been neglected to bring to the attention of eligible non-member banks the advantages of membership in the system. The number of institutions which were admitted during the year was 11, the names and resources being as follows: Bank i Location Riverside, N. J. Hazleton. Pa. Milford. Del. DuBois. Pa. Reading. Pa. Atlantic City. N. J. Burlington. N. J. Atlantic City. N. J. Lewistown, Pa. Huntingdon. Pa. Schuylkill Haven. P« Riverside Trust Company Peoples Savings & Trust Co Milford Trust Company Union Banking & Trust Co Berks County Trust Co Equitable Trust Co Burlington City Loan & Trust Co. Bankers Trust Co Lewistown Trust Co Grange Trust Co Schuylkill Haven Trust Co Admitted Total resources Jan. 3. 1919 $2,039,889 Jan. 13. 1919 2.933.058 Mar. 27 1919 1.077.830 Mar. 28.1919 2.173.668 May 1.1919 3.917,503 June 20.1919 3.166.688 ~une 25. 1919 1.748,441 uly 11. 1919 676.035 iept.27. 1919 752.153 Oct. 7. 1919 706.752 Oct. 17. 1919 1.307.027 This list brings the number of state institutions which have entered the Federal Reserve system in this district up to 40, but, due to the conversion of the Bank of Commerce and the Drovers & Merchants Bank, both of Philadelphia, into national banks, the number now stands at 38. There are 270 eligible non-member state institutions in the district, having total resources of approximately $668,000,000. The member state institutions represent 41 per cent of the total resources of all eligible member and non-member state banks and trust companies. The table given below furnishes pertinent data relative to member state institutions as of November 17, 1919: Member State Institutions Number Capital Surplus Undivided profits Individual deposits Bank deposits Total resources 38 $23,225,000 47,102,000 8,997.877 241,650,071 7,699.936 460,980,948 35 FIFTH ANNUAL REPORT FEDERAL RESERVE BANK OF PHILADELPHIA DOT5 INDICATE LOCATION OF CITIE5 AND TOWNS IN WHICH THERE ARE MEMBER STATE IN5TITUTION5 5TATE BANK MEWBER5 3 8 AVEWBER5 IN 2 4 CITIES AND TOWNS FIFTH ANNUAL, REPORT FEDERAL RESERVE BANK OF PHILADELPHIA Department of Examination Examinations have been made in Delaware, New Jersey and Pennsylvania in co-operation with the state banking departments, which have resulted in more efficient results being obtained to the consequent benefit of all interested. Every effort has been made to keep in close touch with the condition of all member banks and reports of examinations are very carefully analyzed and valuable statistical records are compiled. Fiscal Agency Operations As fiscal agent for the United States the activities of the Federal Reserve Bank were again brought conspicuously to the public attention. The year saw the sale of the last popular loan, and with it a dissolution of the great army of loan workers through whose energetic efforts the five Liberty loans were so successfully distributed. With the war over and the necessity for great popular campaigns ended, the function of conducting the sales of Government securities is again in sole charge of officers of the Reserve Bank. At the beginning of the year, the activities of the Liberty Loan Committee, the War Savings Organization, and the Certificate of Indebtedness Division were consolidated within the district into the War Loan Organization. This organization had at its head a director with associate directors. In this way the fiscal operations were co-ordinated and made more effective. At the close of the Victory loan, this organization automatically dissolved and sales of certificates of indebtedness were handled directly by officers of this Bank. FINAL PAYMENTS ON FOURTH LIBERTY LOAN Final payments on the fourth Liberty loan were completed in January. According to the schedule of payments arranged by the Secretary of the Treasury two installments aggregating 50 per cent wrere due in that month. So many investors paid for their bonds in full during 1918, however, that at the end of that year payments approximated 88 per cent of the $598,763,650 allotted to this district. The remaining 12 per cent was paid in January without disturbance to the money market. VICTORY LIBERTY LOAN The Victory Liberty loan was a complete success, though it was floated at a time when the country was relaxing from the strain of war. Subscriptions in this district amounted to $422,756,100 on a quota given the district by the Secretary of the Treasury of $375,000,000. The allotment to the district was $376,290,100. 37 FIFTH ANNUAL REPORT FEDERAL RESERVE BANK OF PHILADELPHIA The banking institutions co-operated with the Federal Reserve Bank in every way, not only to insure the success of the loan, but also to secure the widest possible distribution of the notes. At the outset of the campaign the financial institutions of Philadelphia as a unit agreed to lend Victory loan subscribers 95 per cent of the face value of their subscriptions for 90 days at 4% per cent, being the coupon rate, with the privilege of renewing the loan for a similar period of 90 days at 4*^4 per cent interest. This offer of the banks was widely accepted. Details of the Victory Liberty loan follow: Philadelphia Totals Philadelphia Totals Population Total banking resources 237.973 666,775 3.793.211 1,800.000 Apportionment Subscription $ 90,769.857 210,214,658 1,023.308,193 1,074.488,676 $ 12,889,200 29,850,400 145,309.800 186.209.450 $ 13.807.650 33.368.850 167.097.400 208,482,200 6.497.959 $2,398,781,384 $374,258,850 $422,756,100 Allotment Number of subscribers Per cent of population subscribing Per capita subscription $ 12.784,450 30.479,200 158,435.100 174.591.350 25,979 93.096 512.683 350.903 10.91 % 13.% 13.52 $ 58.00 50.00 44.00 116.00 $376,290,100 982.661 15.12 $65.00 19.49 SUMMARY OF LIBERTY LOANS The results achieved in the Third Federal Reserve District in the five great war loans deserve recognition. The quotas assigned to this district on the five loans aggregated $1,515,000,000, against which total subscriptions were received of $1,996,142,750, or 132 per cent of the aggregate quota. Allotments to this district were $1,782,348,950. The relation of subscriptions to quotas in each of the loans is given herewith. Quota Totals . Subscription $140,000,000 250.000.000 250.000,000 500.000.000 375,000.000 $232,309,250 380.350.250 361,963.500 598,763,650 422,756,100 $1,515,000,000 $1,996,142,750 Percentage of subscription to quota 165.9% 152.1 144.7 119.7 112.7 131.7 Records of the five loans, tabulated by states, are shown in the following tables: 38 FIFTH ANNUAL REPORT FEDERAL RESERVE BANK OF PHILADELPHIA Record of the War Loans Delaware Victory loan Totals Apportionment Subscriptions $ 6.136,000 7,500.000 8,474.500 16,013.260 12,889.200 $11,917,850 8,314,200 25.391.400 22.621,300 13,807,650 $ 6.136,100 7.705.700 25,391.400 22.621,300 12.784.450 $51,012,960 $82,052,400 $74,638,950 Allotment N e w Jersey Victory loan Totals Apportionment Subscriptions $ 8.817.400 16.527,950 19.379,400 38.439,960 29,850,400 $11,702,700 18.188,150 42.990.850 24,363,450 33.368,850 $ 8,812,100 16,950,400 24,990,850 42,363,450 30,479.200 $113,015,110 $130,614,000 $123,596,000 Allotment Pennsylvania Apportionment Victory loan Total* Subscriptions Allotment $ 53,339,150 108,067,200 101.587,640 200.406.341 145.309.800 $ 63.515.750 118.946,900 142.230,650 222,472.650 167,097.400 $ 53.389.750 107.200,650 142,230.650 222,472.650 158.435.100 $608,710,131 $714,263,350 $683,728,800 Philadelphia Victory loan Total* Apportionment Subscriptions $ 94.964.750 139,499,950 136,499.950 259,198.000 186.209,450 $145,172,950 234,901,000 169,350,600 311.306,250 208.482.200 $ 96.809.650 148.327.350 169,350.600 311.306.250 174.591,350 $816,372,100 $1,069,213,000 $900,385,200 Subscriptions Allotment Allotment All L o a n s Apportionment Philadelphia Totals $ 51,012.960 113.015.110 608.710.131 816.372,100 $ 82.052,400 130,614.000 714.263.350 1.069.213.000 $ 74.638.950 123,596.000 683.728.800 900.385.200 $1,589,110,301 $1,996,142,750 $1,782,348,950 39 FIFTH ANNUAL REPORT FEDERAL RESERVE BANK OF PHILADELPHIA Number of Subscribers Philadelphia Totals First loan Second loan Third loan Fourth loan Victory loan No record 16,570 52.849 309.002 245.126 42.940 153.341 815.035 653.182 58.560 206.545 1.003.181 502.864 25.979 93.0% 512.683 350.903 476.000 623.547 1.664.498 1.771.151 982.661 CERTIFICATES OF INDEBTEDNESS Sales of Treasury certificates of indebtedness continued at intervals throughout the year. Every issue was oversubscribed where a quota was assigned. Sales of all issues during the year aggregated $681,511,500. The first issue of certificates in anticipation of the Victory loan was dated December 5, 1918, and series of certificates were issued at fortnightly intervals until near the end of the campaign. After the Victory loan, due to the stronger financial position of the Treasury, flotations were made at less frequent intervals. No loan certificates were issued between May 1 and August 1, and no certificates of any kind were issued between September 15 and December 1. An analysis of the subscriptions to the ten issues of certificates in anticipation of the Victory loan follows: State banks Savings banks Number subscribing Percentage of total in district Amount subscribed 598 200 133 92.71 86.58 78.70 100.00 $272,140,000 115,377.500 20,016,000 12.155.000 89.34 $419,688,500 646.000 24 955 38 Total banks Individuals Total sales of tax certificates with maturities extending into 1920 were $133,223,500. The amount of each maturity sold was as follows: March 15—$28,414,500; June 15—$50,222,500; September 15—$54,586,500. 40 FIFTH ANNUAL REPORT FEDERAL RESERVE BANK OF PHILADELPHIA Treasury Certificates Issued During 1919 T a x Certificates Issued Date of Issue Maturity June June Sept. Dec. Sept. Sept. Mar. Mar. Sept. Mar. June T-2.. T-3.. T-4.. T-5.. T-6.. T-7.. T-6\. T-9.. T-10. TM-3 TJ... 17. 16, 15. 15, 15, 15. 15. 15. 15, 15, 15. Rate 1919 1919 1919 1919 1919 1919 1920 1920 1920 1920 1920 4' 2 4:2 41 2 4'. 2 412 4'/4 4' 2 4'4 4'/2 Subscription $19,744,000 18,874.000 18,686,500 8,031.000 14,730.000 21.129,000 12.369,500 5.563.000 54.588.500 10.482.000 50.222.500 Treasury Certificates o f Indebtedness Issued in 1 9 1 9 i n anticipation of Victory Liberty Loan Date of Issue 5-C. 5-D 5-E. 5-F. 5-G 5-H Jan. Jan. Jan. Feb. Feb. Mar. Apr. May 2. 1919 16, 1919 30, 1919 13. 1919 27. 1919 13, 1919 10. 1919 I. 1919 Maturity une une uly uly uly Aug. Sept. Oct. 3. 1919 17. 1919 I. 1919 15. 1919 29, 1919 12. 1919 9. 1919 7. 1919 Rate 4'/? 4J/2 % r Quota Subscription $53,000,000 42.400.000 42,400.000 42.400.000 35.300,000 35,300.000 35.300,000 35.300.000 $53,300,000 43,533,500 46.173,000 43,323.500 38.247.000 36,758.000 39.160,500 35.301,500 Treasury Certificates o f Indebtedness Issued in 1 9 1 9 Subsequent to Victory Liberty Loan Date of Issue A-1920 B-1920. C-1920 D-1920 Aug. 1, 1919 Aug. 15. 1919 Sept. 2. 1919 Dec. 1. 1919 Maturity Jan. Jan. Feb. Feb. 2. 15. 2. 16. 1920 1920 1920 1920 Rate 4'/2% 4'/2 4'/2 4'/4 Quota Subscription $35,300,000 35.300.000 $36,264,500 36.276.000 27.155.000 11.601.000 GOVERNMENT DEPOSITS At the close of 1919 the total number of banks designated as United States depositaries was 666, as compared to 647 at the end of 1918. Of the $1,080,000,000 in securities handled during the year in connection with the securing of Government deposits, municipal bonds formed 10 per cent of the total; foreign government bonds, 10 per cent; railroad and utility bonds, 20 per cent; commercial paper, 30 per cent; and war-time obligations of the United States, 30 per cent. The Government deposits averaged about $66,000,000 during the year, with an average amount of collateral held to secure the same of $118,000,000. Custodians of collateral numbered 115 at the end of the year. WAR SAVINGS DIVISION Sales of stamps and Treasury savings certificates fell off markedly after the armistice was signed and the stimulus of war was removed. There was a smaller percentage of redemption, however. In 1918, a 41 FIFTH ANNUAL REPORT FEDERAL RESERVE BANK OF PHILADELPHIA year of intensified selling, the sum of $73,000,000 worth of stamps was sold in this district and approximately 10 per cent of this total was redeemed at post offices during the year. In 1919, when sales were only $8,000,000, it is estimated that less than 2 per cent of the total sales were redeemed. Stamps have been sold to 1,000,000 persons, and it is estimated that there are now 2,000,000 stamp-owners in this district. The average cost during 1919 was approximately 1.5 cents per dollar raised. Following the Victory loan and the dissolution of the War Loan Organization the direction of the savings movement was taken over by the Federal Reserve Bank and the work is now conducted as a departmental operation of the Bank. Sales of war savings and thrift stamps by this Bank during 1919 totaled $988,561, and of Treasury savings certificates $438,100. 42
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