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BOARD OF GOVERNORS SYSTEM > . OF THE FEDERAL RESERVE' _r * „,„*,***'**'^ (For Immediate Release) E.$ | V ^♦C^ j 19^ J0i MEMBER BANK EARNINGS, 1956 « \ Net current earnings before income taxes airou^fid.^.to~^ ^3V^i7nl*• lion in 1956 , $31Ii million more than in 195$, according to preliminary tabulations of member bank earnings. Net profits after taxes, however, increased only $Ul million because of a substantial increase in net losses and charge-offs. The ratio of net profits to average total capital accounts decreased from 7«9 to 7.7 per cent. Gross current earnings were $722 million higher. An increase of $ 6U0 million- in earnings on loans was the major item, with average holdings of.loans increasing $9.7 billion and the rate of return from 1.77 to 5 .0L per cent. - Earnings on United States Government securities declined slightly, as a result.of a decrease in holdings of $$.9 billion and a rise in the average rate of return from 2.09 to 2.31 per cent. $102 million. Other earnings rose Gross current expenses increased $U08 million. The net of losses, recoveries, profits, etc., was a loss of $ 6U6 million, compared to S ^U01 million in 19$$. Profits before income taxes were reported $70 million higher, and taxes on net ircome increased $29 million. Dividends amounted to $$U6 million or $3 per cen1 of 1956 net profits; this represented a return on average total capital accounts of U,1 per cent,- compared with U.O per cent in 19$$* Retained earnings were $H8l million, approximately the same as in 19$$* (Gver) MEMBER BANK EARNINGS, BY CLASS OF BANK, 1956 AND 1955 Item (In millions of dollars, 1956 figures preliminary) ---- - m ----Central Reserve City Banks Member Banks Chicago New York 1956 1 1955 1956 | 1955 1956 | 1955 Reserve City Ba»itw 1956 | 1955 Earnings On TJ, S, Government securities On loansV A H mother 6,o6l* 5,31*3 1,118 3,085 1,11*1 1,011* 133 631* 21*8 867 156 1*81* 227 21*3 1*9 11*5 1*9 209 2,390 1,098 3.72U 1,21*3 57 1*02 Expenses 3,673 3,265 536 1*72 Net current earnings before income taxes 2,392 2,077 1*78 395 Recoveries, profits, and transfers from valuation reserves*-/ 255 213 75 1*8 Losses, charge-offs, and transfers to valuation reserves,?/ 881 611* 207 1,71*6 1,676 720 Profits before income taxes Taxes on net income Net profits Cash dividends declared Ratios (per cent); Net current earnings before income taxes to average total capital accounts Nbt profits to average total capital account^ Average return on U, S, Government’ securities Average return on loans l/ 2/ 5/ *956 T95 5 1*7 1,510 1*78 2,095 1*20 1,232 1*1*3 2,1*17 513 1,1*35 1*69 2,173 1*85 1,265 1*21* 123 111 1,1*35 1,271* 1,578 1,1*08 119 98 955 821 839 761* 11* 12 92 91 51* 62 121* 51 27 325 21*0 297 221* 31*6 319 82 83 722 671 596 603 691 157 133 30 31* 303 278 230 21*6 1,026 985 189 187 52 1*9 1*19 393 366 357 51*6 501 133 121* 23 21 222 202 168 151* 16; 6 ' 7.9 17.0 6.7 19.6 18.3 17.0 16.1* 7.J, 5.56 18.0 7.7 2.31 5.01 2.09 1*.77 2.22 i*.ll* 105 16.0 11*.1* 18.7 .6*8 “■ b.e ‘ 2.05 2,02 2.19 3.66 1*.19 , 3.681 Includes charges on loans other than interest; these charges are estimated for 1956* Does not inolude recoveries credited to valuation reserves, Does not inolude losses charged to valuation reserves. Country Banks 2.30 1 :8s 5*02 i*.76j U > 5. ®
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