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, ,» /• B U S & ECCS'- * BOARD OF GOVERNORS OF THE FEDERAL RESERVE SYSTEM E»5> (For Immediate Release) August 10, 1955 MEMBER BARK EAMmiQS, FIRST HALF OF PRATT f lt C " ! LIBRARY ! v Preliminary figures on member bank earnings in i i c a t ^ ^ a t ^ n ^ ^ profits, after taxes for the first six months of 19$$ wer 3 S M d t e : f i® . 3 I compares with §$$9 million and $1(38 million in the corresponcdbg ^ePYUUD 19$b and 1953, respectively. The ratio of net profits on an annual basis to average total capital accounts was 7.8 per cent compared to 9*7 and 8.0 per cent for the first six months of 195 U and 1953 . Net current earnings before income taxes were $998 million, an in crease of $70 million over the first six months of last year. Earnings on loans rose $108 million and earnings on United States Government securities rose $33 million. The increases resulted from larger holdings as the average rates of return on both loans and Government securities for the first half of 19$$ were, practically unchanged from the corresponding period last year0 Percentagewise, expenses increased somewhat more than earnings. The net of recoveries, profits, losses, etc., during the period resulted in a loss of $83 million, compared to a gain of $10 ii million in the first six months of 1 9$h* For 1 9 $ $ , this represents the usual relation ship among these items, in contrast to the net gains reported in 195 U and 19U6. The return to a net loss position resulted from a decline in profits on sales of securities. Taxes on net income for the first half of 1955 were reported as $li30 million. Although this was a $U3 million decline from the first half of 195U, taxes represented about the same percentage of profits before in come taxes as in corresponding periods of 195U and 1953. Taxes on net income reported by country banks were higher than in either half of 195li* Cash dividends declared amounted to $232 million in the first six months of 1955. This was a U8 per cent distribution of net profits after taxes and an approximate annual yield of 3.8 per cent on average total capital accounts, compared to 38 per cent and 3.7 per cent, respectively, in the first half of 1951u (Over) MEMBER BANK EARNINGS, BY CLASS OF BANK, FIRST AND SECOND HALVES OF 1954 AND FIRST HALF OF 1955 Item Earnings: On U. S. Government securities On loans l/ All other Expenses Net current earnings before income taxes Recoveries, profits, and transfers from valuation reserves 2 / Losses, charge-offs, and transfers to valuation reserves 3/ Profits before income taxes Taxes on net income (In millions of dollars; first half 1955 preliminary) Central Reserve City Banks All MciryTKeav* Doyilro .New Yorlz Chicago First Second First1 First Second First First Second First Half Half Half Half Half Half Half Half Half 1954 1954 :1954 1954 1954 1954 1955 1955 1955 First Half 1954 Second Half 1954 First Half 1955 First Half 1954 Second Half 1954 First Half 1955 962 202 1,001 211 1,010 1,039 548 213 574 959 224 543 191 233 576 201 233 599 207 662 2,3 66 522 1,336 508 1,438 928 96 , 96 100 926 82 .222 110 28 47 29 46 29 49 22 21 21 197 535 194 217 175 225 189 52 44 54 42 55 45 564 605 6ll :■ 356 •613 387 684 362 348 326 60 26 16 9 5 139 108 32 100 69 59 42 173 9 51 6 104 397 111 43 19 192 353 155 64 355 157 62 386 169 298 88 343 175 2,460 2,554 384 393 414 545 1,375 541 555 1,444 554 72 211 101 81 206 106 173 52 1,56 1 1,555 900 998 211 216 377 307 245 203 1,032 473 277 180 27 869 198 176 332 915 430 89 72 80 22 9 42 17 Net Profits 559 537 484 109 104 93 28 25 25 205 198 199 217 210 169 Cash dividends declared 211 245 232 51 62 ~ 58 12 8 13 86 95 94 6l 81 67 Ratios - annual basis (in per cent): Net current earnings before income taxes to average total capital accounts Net profits to average total capital accounts Average return on U. S. Govt, securities Average return on loans 16 .1 •9.7 2.00 4.68 15.1 9.0 1.93 4.75 97 16.2 7.8 2.01 4.67 13.3 8.4 1.84 3.57 13.0 7.7 1.76 3.53 1/ Includes charges on loans other than interest; these charges are estimated for 1955« 2/ Does not include recoveries credited to valuation reserves. 3/ Does not include losses charged to valuation reserves. (Over) 13.7 6.8 1-95 3.52 15.4 a. 01 14.3 8.5 li88 3.60 3.60 10.0 15.0 17.9 1.98 10.1 2.02 3.64 4.75 8.3 16.9 9.4 l.'9l 4.79 17.6 9.1 2.04 4.66 16.3 10.2 2.03 5.39 97 14.6 9.4 35 68 16.4 7.4 2.02 2.02 5.55 5.47
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