View original document

The full text on this page is automatically extracted from the file linked above and may contain errors and inconsistencies.

FE D E R AL R ESER VE BAN K
OF DALLAS

Dallas, Texas, March 28, 1986

ANNUAL REPORT FEDERAL RESERVE AGENT, 1935

To the Member Bank Addressed:

For the information of your officers and directors, and in the hope that
it may be found of interest, there is enclosed a copy of the twenty-first
annual report of the Federal Reserve Bank of Dallas for the calendar year
ended December 31, 1935.
Detailed statistical schedules covering the operations of the bank in
1935 will be published in the annual report of the Board of Governors of
the Federal Reserve System, a copy of which will be furnished you.

Yours very truly,

Federal Reserve Agent

This publication was digitized and made available by the Federal Reserve Bank of Dallas' Historical Library (FedHistory@dal.frb.org)

T W E N T Y -F IR S T A N N U A L REPORT

of the
F E D E R A L R E S E R V E B A N K OF D A L L A S

1935

T W E N T Y -F IR ST
A N N U A L REPORT
of the

FEDERAL RESERVE BANK
OF D A L L A S

1935

LETTER OF TRANSMITTAL

February 4, 1936

Gentlemen:

I have the honor to submit herewith the twenty-first
annual report of the Federal Reserve Bank of Dallas covering
the year ended December 31, 1935.

Respectfully,
C. C. W ALSH
Federal Reserve Agent
Board of Governors of the
Federal Reserve System
Washington, D. C.

DIRECTORS AND OFFICERS
of the
FEDERAL RESERVE BAN K OF DALLAS
(As of March 1, 1936)

DIRECTORS
CLASS A

CLASS B

R. E. HARDING, Fort Worth, Texas

A. S. CLEVELAND, Houston, Texas

ALF MORRIS, Winnsboro, Texas

J. R. MILAM, Waco, Texas

PAT E. HOOKS, Itasca, Texas

JOHN D. MIDDLETON, Greenville,Texas
CLASS C

C. C. WALSH, Dallas, Texas
S. B. PERKINS, Dallas, Texas

MEMBER FEDERAL ADVISORY COUNCIL
J. H. FROST, San Antonio, Texas

ALTERNATE
W. W. WOODSON, Waco, Texas

OFFICERS
C. C. WALSH, Chairman, and Federal
Reserve Agent
S. B. PERKINS, Deputy Chairman
CHAS. C. HALL, Assistant Federal
Reserve Agent, and Secretary
W. J. EVANS, Assistant Federal Re­
serve Agent
W. P. CLARKE, General Auditor
C. C. TRUE, Assistant Auditor

B. A. McKINNEY, President
R. R. GILBERT, First Vice President
R. B. COLEMAN, Vice President and
Cashier
W. O. FORD, Assistant Vice President
E. B. AUSTIN, Assistant Cashier
L. G. PONDROM, Assistant Cashier
R. O. WEBB, Assistant Cashier

COUNSEL
C. C. HUFF, General Counsel
LOCKE, LOCKE, STROUD, & RANDOLPH, Counsel

EL PASO BRANCH
DIRECTORS
S. P. APPLEWHITE, Douglas, Arizona, Chairman
C. N. BASSETT, El Paso, Texas

J. L. HERMANN, El Paso, Texas

FRANK R. COON, Lordsburg, N. M.

SAM D. YOUNG, El Paso, Texas

OFFICERS
J. L. HERMANN, Managing Director
ALLEN SAYLES, Cashier

HOUSTON BRANCH
DIRECTORS
SAM TAUB, Houston, Texas, Chairman
W. D. GENTRY, Houston, Texas

SAM R. LAWDER, Houston, Texas

A. A. HORNE, Galveston, Texas

J. A. WILKINS, Houston, Texas

OFFICERS
W. D. GENTRY, Managing Director
H. R. DeMOSS, Cashier

SAN ANTONIO BRANCH
DIRECTORS
JOHN M. BENNETT. San Antonio. Texas, Chairman
J. K. BERETTA, San Antonio, Texas
M. CRUMP, San Antonio, Texas
GEORGE C. HOLLIS, Eagle Pass,
Texas

FRANK M. LEWIS, San Antonio,
Texas
WALTER P. NAPIER, San Antonio,
Texas

OFFICERS
M. CRUMP, Managing Director
W. E. EAGLE, Cashier

FEDERAL RESERVE BANK OF DALLAS
COMPARATIVE STATEMENT OF CONDITION
(In Thousands of Dollars)
RESOURCES
Dec. 31
1935

Dec. 31
1934

Gold certificates on hand and due from U. S. Treasury (including bal­
$128,870
ances in the gold fund maintained in Washington) ----------------Redemption fund—F. R. notes..............- .....................- ...........................- ......... ........
681
Other cash ..............- .... -........... - .......................................... - ................. - ......................
6,659

$106,021
328
8,739

Total reserves .................................

$136,210

Bills discounted:
Secured by U. S. Government obligations direct and/or fully guaranteed
Other bills discounted ............................................................................................
Total bills discounted ......................................
Bills bought in open market....... .....
Industrial advances ....................... — ................................... -......................................

$115,088
12

12
12

12

126
1,780

154
1,045

16,033
47,293
15,649

18,818
38,701
13,956

U. S. Government securities:
Bonds ............................................. —..... ............................... -................................
Treasury notes ........-................................................... -...................................... —
Treasury bills ............................... .................................. -.... -..................................
Total U. S. Government securities.................................................... - ..........

78,975

71,475

Total bills and securities..... -...........................................................................

80,893

72,686

Due from foreign banks.—........................ - ...................................... - ............ ..........
F. R. notes o f other banks.....................................................................
Uncollected items ..............- ............................ - ..................................................- ..........
Bank premises, net..............- ..............................................-............................................
All other resources..............- ...............................................-...........................................

17
608
19,607
1,524
761

22
421
15,451
1,684
856

Total resources .................................................................................................. $239,620

$206,208

LIABILITIES
F. R. notes in actual circulation.................................................................................. $ 76,064
Deposits:
Member bank—Reserve account............................
U. S. Treasurer— General account.....................
Foreign banks .........................
Other deposits ...................................

$ 53,845

123,816
4,856
757
2,234

121,135
2,578
587
1,143

Total deposits ........................................................_......................................... $131,663

$125,393

Deferred availability item s....................................
Capital paid in.......................................................................................
Surplus (Section 7 )....................................... ......................- .................... ....................
Surplus (Section 13b)................................................................... ................................
Reserve for contingencies......................
All other liabilities............................. ..................................................... ...... _..............
Total liabilities ................................................
Ratio of total reserves to deposit and F. R.
Note liabilities combined.......... ......... ..................................... ...................................
Contingent liability on bills purchased fo r foreign correspondents...... ... ........
Commitments to make industrial advances............................. .................. ...............

21,694
3,773
3,783
1,256
1,361
26

17,720
4,048
3,777

$239,620

$206,208

65.6

64.2
18

593

1,363
62

TWENTY-FIRST A N NU AL REPORT
of the
FEDERAL RESERVE BANK OF DALLAS

Resume of Business Conditions
Business and industrial activity in the Eleventh Federal
Reserve District increased further in 1935; conditions in agri­
culture and livestock raising improved; and the volume of
banking resources available for financing agriculture, com­
merce, and industry continued to increase. The sales of de­
partment stores in principal cities were maintained at a higher
level throughout the year, and the volume of business for the
twelve months was 6 per cent larger than in 1934. This bank’s
index of department store sales, which is adjusted for seasonal
variations, rose to 95 per cent of the 1923-25 average in De­
cember, which was the highest point reached in more than
four years. The distribution of merchandise at wholesale by
reporting firms during 1935 averaged 10 per cent above that
in the previous year. Collections on accounts at both whole­
sale and retail establishments compared favorably with those
a year earlier. Debits to individual accounts at banks in larger
cities in 1935, which were the largest reported in five years,
exceeded those in the previous year by 15 per cent. The num­
ber and liabilities of failures in this district, as compiled by
Dun & Bradstreets, Incorporated, were slightly larger than
the unusually small figures reported for 1934.
The volume of construction work, which turned upward
during the latter part of 1934, registered a marked gain in
1935. The valuation of building permits issued at principal
cities exceeded that of the previous year by 114 per cent.
Moderate increases over the previous year also occurred in
the production and shipments of cement. The production of
petroleum continued fairly steady throughout the year on a
moderately higher scale than in 1934. Posted prices for crude
oil at major fields showed little change during the year.
The physical volume of agricultural production was sub­
stantially larger than in the drought year of 1934. While the
continuance of drought in some sections during the early
spring delayed planting and greatly reduced the production
of wheat in the heavy producing area of northwest Texas,
the moisture situation was largely corrected by rains late in
April. The production of feed crops was unusually large and
has provided farmers with an ample supply of feed to make

m

1936 crops which will be an important factor in holding down
the cost of production. While the production of cotton fell
considerably under the early season expectations due to wide­
spread insect activity and adverse harvesting conditions, the
outturn was substantially larger than in the previous year.
Most minor crops also showed heavier yields. According to
the Department of Agriculture the unit price of most com­
modities was lower than in 1934, but the increased production
more than offset the lower prices on total values so that the
total value of all crops exceeded by a substantial margin that
in the previous year.
The past year also witnessed a marked recovery in the
physical condition of the district’s ranges and livestock. At
the opening of 1935 ranges and livestock were in very poor
condition as a result of the severe drought in 1934, but con­
ditions began to improve following the widespread rains in
February, and there was a sharp recovery during the late
spring and summer months. At the year-end conditions were
well above the average and there was an ample supply of range
and dry feed to carry stock through the winter. There was
a further decline in the production of wool due to the fewer
number of animals shorn. Wool prices, which reflected a
downward trend in the latter part of 1934 and the early months
of 1935, turned upward late in May and the rising trend con­
tinued during the remainder of the year. A sharp advance
also occurred in mohair prices. Livestock prices reflected a
sharp increase in January and, despite considerable fluctuation
in subsequent months, remained substantially higher than in
the previous year. During the latter half of the year range
trading was active at rising prices.
The banking situation was marked bj^ a rise in deposits of
member banks to a new high level and an increase in their
loans and investments. Member banks’ borrowings at the
Federal Reserve Bank continued at a low level throughout the
year, and the reserve deposits were maintained in a volume
greatly in excess of requirements.

[8]

FEATURES OF OPERATIONS, YEARS 1935 and 1934
1935

Number of
Items
LOANS, REDISCOUNTS, AND INVESTMENTS:
Discounts and advances .....................................................
Bills bought for own account..............................................
Purchase and sale of securities for own account_ __
_
Purchase and sale of securities other than own account
CURRENCY AND COIN:
Bills received and counted ................................................
Coin received and counted.......... ......... ............... ............
CHECK COLLECTIONS:
Checks collected................. ...................... ............................
Collection items handled...........
........... ...................
Return items...... ........ ............................................. ............
U. S. Government checks paid.................... .................. .
U. S. Government coupons paid ............................ .... .
Coupons of Government agencies paid...........................
TRANSFERS:
Transfers of funds for member banks....................... ......
FISCAL AGENCY:
U. S. securities issued, exchanged and redeemed.......
Securities of Government agencies issued, exchanged
and redeemed......................................................................

2,800 $

1934

Amount
5,230,081
817 ,5 86

Number of
Items

Amount

1,760 $

3 ,96 1 ,29 8

715

10,692,214

2

1,59 0 ,00 0

11

14,410,000

2,767

249 ,3 62 ,1 92

4,77 9

3 0 9 ,7 62 ,1 95

51,6 5 2,9 2 4

176,151,550

51,3 9 1,5 3 3

181,775,350

4 5 ,2 5 8,3 4 2

5,343,478

4 2 ,0 5 4,1 5 3

5,443,367

3 5,562,136

6 ,04 5 ,06 2 ,6 24

3 1,001,640

5,34 8 ,52 3 ,1 49

203,411

2 7 6 ,3 83 ,5 53

213,030

2 4 9 ,5 24 ,6 35

886,108

26,9 4 6,0 0 4

777,707

4,848,250

4 0 5 ,9 24 ,9 60

6,318,365

24,282,561
436 ,0 14 ,2 70

484 ,6 72

8,40 4 ,06 8

249,048

5 ,48 4 ,39 5

295,241

2 ,84 6 ,17 7

64,879

3 ,02 6 ,72 2 ,2 71

74,497

2,66 3 ,73 9 ,7 01

135,761

386 ,1 83 ,1 36

113,131

4 14 ,339,140

54,394

4 2 ,4 0 6,5 5 5

1,139

2,38 2 ,82 0

EARNINGS AND EXPENSES
The gross earnings of the bank in 1935 were $1,507,244, as
compared with $1,521,971 in 1934, a decrease of $14,727, or
.97 per cent. The principal sources of revenue during the year
were United States Government securities and industrial ad­
vances made under the provisions of Section 13b of the Federal
Reserve Act. Revenues derived from these sources amounted
to $1,382,121 and $97,424, respectively, as compared with
$1,449,799 and $8,405 during 1934.
Current expenses in 1935 were $1,229,168, as compared
with $1,161,111 in 1934, an increase of $68,057, or 5.9 per cent.
The increase in expenses was occasioned by a payment in ad­
vance, at a discount, of part of the accrued liability to the
Retirement System of the Federal Reserve Banks.
Current net earnings in 1935 were $278,076, as compared
with $360,860 in 1934, a decrease of $82,784. This figure was
augmented by $184,010, largely representing profit realized on
transactions in the System Investment Account of United
States Government securities. Deductions from current net
earnings, covering building reserve and other miscellaneous
deductions, aggregated $195,229, leaving net available earnings
of $266,857. This figure compares with net available earnings
for 1934 of $331,869. It should be noted, however, that in 1935
the bank set up additional special building deprecation re­
serves amounting to $76,000, and made a special write-down
of approximately $14,000 in connection with its fixed invest­
ment in real estate.
Semi-annual dividends aggregating $237,615 were paid to
stockholders and $19,120 was paid to the Secretary of the
Treasury as a 2 per cent dividend on amounts advanced this
bank under provisions of Section 13b of the Federal Reserve
Act. The remaining balance was transferred to surplus (Sec­
tion 7) and surplus (Section 13b) in amounts of $5,814 and
$4,308, respectively, leaving our surplus accounts at December
31, 1935, as follows: Section 7, $3,783,162; Section 13b,
$1,256,096.
OPEN MARKET OPERATIONS
On January 1, 1935, the bank’s total holdings of United
States Government securities amounted to $71,475,000. Of
this amount $10,000,000 represented its independent holdings
and $61,475,000 represented participation in the Federal Re­
serve Sytem’s Special Investment Account.
Independent holdings remained at $10,000,000 throughout
[10]

the year. Participation in the System’s purchases of Govern­
ment securities fluctuated at intervals during- the year, reach­
ing a high point of $71,475,000 on August 5. The account
decreased to $68,975,000 on November 6 and remained un­
changed at that figure throughout the remainder of the year.
A t the close of business December 31, 1935, the bank’s total
holdings of United States Government securities amounted to
$78,975,000.
The average yield on holdings of Government securities
was 1.84 per cent for the year.
INDUSTRIAL LOANS
On June 19, 1934, Section 13b was added to the Federal
Reserve Act. Under its terms the Federal reserve banks are
authorized to aid in providing working capital for established
industrial or commercial businesses, by making direct loans,
by making loans in participation with financing institutions,
and by the execution of commitments. In obtaining a commit­
ment from the Federal reserve bank, the financing institution
is assured that it can turn the designated portion of an advance
into cash at any time it desires, w ith in the terms of the
commitment.
The first loan made in the Eleventh Federal Reserve Dis­
trict under the provisions of this section was closed on August
10, 1934. The following schedule shows the volume of indus­
trial loans made from that date up to and including December
31, 1935, classified according to direct advances to borrowers
and loans made in conjunction with financing institutions:
ADVANCES AND COMMITMENTS MADE
Fc:deral Reserve
Bank
Participations
of
by financingNo.
Dallas
institutions

Total

Direct advances.............. 75
Commitments ____ ...... 6

$ 2 ,0 6 3 ,6 1 2
6 2 2 ,0 0 0

$ 2 4 0 ,7 5 0
1 7 1 ,0 0 0

$ 2 ,3 0 4 ,3 6 2
7 9 3 ,0 0 0

81

$ 2 ,6 8 5 ,6 1 2

$ 4 1 1 ,7 5 0

$ 3 ,0 9 7 ,3 6 2

Collections on loans and commitments amounted to $303,129.
To assist in carrying out the provisions of Section 13b of
the Federal Reserve Act, an Industrial Advisory Committee
considers applications for industrial loans and makes recom­
mendations to the Federal reserve bank in connection there­
with. The members of the committee for this district

[ii]

appointed by the directors of the Federal Reserve Bank, and
confirmed by the Board of Governors of the Federal Reserve
System, are as follows:
Clarence Ousley, (chairman), president, Globe Laboratories,
Fort Worth, Texas.
T. M. Cullum, president, Cullum and Boren Company, Dallas,
Texas.
Lewis R. Ferguson, vice-president and general manager, Lone
Star Cement Co., Dallas, Texas.
Will B. Marsh, president, Chronister Lumber Co., Dallas and
Forest, Texas.
Charles R. Moore, president, Austin Bridge Company, Dallas,
Texas.
DISCOUNT OPERATIONS
The volume of paper discounted and rediscounted during
1935, excluding foreign loans on gold, was $4,213,268. This
figure, compared with $2,914,498 in 1934, shows an increase
of $1,298,770, or 45 per cent.
At the beginning of the year outstanding loans amounted
to $12,000. This indebtedness was paid January 2, and shortly
thereafter member bank borrowings were resumed and grad­
ually increased until May 1, when discounts amounted to $551,540. They declined to $291,534 on July 5, but from this figure
they increased to $729,282 on August 23, which was the maxi­
mum for the year. At the close of the year outstanding loans
amounted to $2,721.
Of the total advances to member banks during the year,
96 per cent were made to national banks and 4 per cent to State
banks, which is approximately the same ratio as in 1934.
During 1935 notes secured by United States Government
obligations aggregated $2,962,150, or 70 per cent of the total
paper discounted, as compared with $1,099,400, or 38 per cent,
in 1934.
RESERVE POSITION
For the first six months of the year the reserve position
of the bank ranged between a maximum ratio of 68.2 per cent
(the highest of the year as of weekly reporting periods) on
February 13, when total reserves were $127,537,000, to a min­
imum of 58.0 per cent on April 24, when total reserves were
$96,843,000.

[12]

During the latter half of the year the ratio fluctuated be­
tween a maximum of 67.5 per cent on July 31, when total
reserves were $145,554,000, to a minimum of 57.5 per cent on
August 31, when total reserves were $101,929,000.
CLEARING OPERATIONS
It will be observed from statistics shown elsewhere in this
report that there has been an increase in both number and
amount of checks handled in the Transit Department in 1935
when compared with the preceding year. From 1929 through
1933 there was a continuous downward trend in these volume
figures. There was an increase of 11.5 per cent in amount and
8.3 per cent in number of checks handled in 1935 over 1934.
The volume usually reaches an annual peak during the fall
months. For 1935 the peak occurred on October 14 when the
bank handled 232,261 items. The daily average for the year
was 135,605 items, and the daily average in aggregate amount
was $21,647,609.
Statistics show that there was practically no increase in
the volume of city checks. The growth in the volume of coun­
try items, however, was very good and represented a gradual
upward trend throughout the whole year. It will be observed
from the comparative statistical figures in this report that
there was some reduction in both number and amount of
checks drawn on the Treasurer of the United States.
In 1934 there was received a considerable volume of Treas­
urer’s checks issued by the Civil Works Administration. These
payments were discontinued in 1935 and the volume was af­
fected accordingly. There were received during the last half
of the year checks drawn on the Treasurer of the United
States issued under the Emergency Relief Appropriation Act,
which, to a certain extent, offset the reduced volume just re­
ferred to.
Considering the volume figures for the comparative years,
work in the Non-Cash Collection Division reflected normal
activity.
CHANGES IN MEMBERSHIP
On January 1, 1935, the total number of national banks in
this district was 508. During the year 2 national banks were
chartered; 16 were dropped through liquidation, mergers, and
other causes, making a net decrease of 14, or a total on Decem­
ber 31, 1935, of 494.
On January 1, 1935, the total State bank membership was
60. During the year 3 State banks were admitted to member­

[ 13]

ship, and the membership of 3 State banks was terminated
through liquidation, consolidations and other causes, resulting
in no change in the number of State bank members at the end
of 1935.
The following table shows the total number of member
banks (national and State) in the district on December 31,
1935, by States:
National
8
9
16
10
.......456

Arizona ............
Louisiana ........
New Mexico ............
Oklahoma ........
Texas ______

Total ............. ........................ 494

State
2
2
3
—
53
60

Total
5
11
19
10
509
554

CASH DEPARTMENT
Throughout the past year the work performed in the
money department showed normal activity. This fact is re­
flected in statistical figures shown elsewhere in the report.
The average amount of Federal reserve notes in circulation
during 1935 showed an increase of $12,228,946 when com­
pared with 1934. This increase in average circulation, as well
as an increase in the maximum circulation, when compared
with the previous year, is largely the result of the termination
of national bank note circulation. Inasmuch as all national
bank notes received subsequent to August 1 were immediately
retired from circulation, the circulation of notes of this bank’s
own issue increased from this date to the end of the year. The
maximum circulation occurred on December 24, and was inci­
dental to Christmas trade occurring at that time.
There is submitted below table showing the average, max­
imum and minimum circulation in 1935 as compared with 1934
and 1933:
1935
Average ____
$57,120,381
Maximum ............. 77,818,845
Minimum ..........
46,458,075

1934
$44,891,435
55,428,090
38,417,775

1933
$37,965,000
62,996,000
31,282,000

BANK EXAMINATIONS
During the year 1935 the Examination Department con­
ducted 56 examinations of State member banks, of which 54
were made jointly with the State authorities, and 2 were made
independently. Three non-member banks were examined for

[14]

membership in the Federal Reserve System and subsequently
qualified and were admitted to membership in the Federal Re­
serve System.
Pursuant to the provisions of Section 21 of the Banking Act
of 1933, 27 private banks in the district submitted to examina­
tion by this bank’s examiners in 1935.
The department’s activities also included special visits to
2 member banks for the purpose of securing a classification of
certain assets. A total of 88 visits were made during the year,
as compared with 129 visits during the preceding year.
INSOLVENT BANKS DIVISION
During the year 1935 there were no member bank failures
in this district. Nine member banks in receivership were in­
debted to the Federal Reserve Bank at the beginning of the
year. The indebtedness of three of these banks has since been
paid in full and on December 81, 1935, the indebtedness of the
remaining six banks amounted to $52,024.78, against which a
reserve of approximately $33,000 is carried.
INTERNAL ORGANIZATION AND PERSONNEL
The board of directors held 11 meetings during 1935, with
an average attendance of 8.
There was no change in the personnel of the board in 1935.
The only change in the official staff was that caused by the
retirement of Cashier Harris on account of ill health on Janu­
ary 1. The office of cashier was combined with that of deputy
governor, and R. B. Coleman was elected to that position.
A t its meeting on January 7,1935, the board of directors re­
elected J. H. Frost, president of the Frost National Bank of San
Antonio, Texas, as the representative on the Federal Advisory
Council for the Eleventh district, and redesignated W . W .
Woodson, president of the First National Bank of Waco, Texas,
as alternate.
In the annual election in November, A lf Morris, president of
the First National Bank of Winnsboro, Texas, was reelected a
Class A director, representing banks in group 2, and John D.
Middleton, president of the Texas Refining Company of Green­
ville, Texas, was reelected a Class B director, representing
banks in group 3, for three-year terms beginning January 1,
1936.
On December 5, 1935, the Board of Governors of the Fed­
eral Reserve System announced that since it would be sue-

[15]

ceeded by a new board on February 1, 1936, it had been decided
to have the designations of all Chairmen and Federal Reserve
Agents expire on March 1, 1936. It therefore redesignated C.
C. Walsh as Chairman of the Board and Federal Reserve Agent
and S. B. Perkins of Dallas as Deputy Chairman of the Board
for the period from January 1 to February 29, 1936.
There were no changes in the officers and directors at the
branches during 1935.
A t the meeting of the board of directors of the head office
on December 13, 1935, Frank R. Coon, president of the Mimbres Valley Bank, Deming, New Mexico, was appointed a di­
rector of the El Paso Branch, succeeding Arthur F. Jones of
Portales, New Mexico, and Sam R. Lawder, vice president of
the First National Bank in Houston, Houston, Texas, was re­
appointed a director of the Houston Branch, for three years,
beginning January 1, 1936.
At the same meeting J. K. Beretta, president of the Na­
tional Bank of Commerce, San Antonio, Texas, was appointed
a director of the San Antonio Branch for three years, beginning
January 1, 1936, succeeding Franz C. Groos.
Early in 1935 the Board of Governors of the Federal Re­
serve System announced that it had reached the conclusion
that six years’ service represents the maximum period during
which a director should remain continuously in office; further,
that in the selection of branch directors the Board would fol­
low the policy of appointing individuals who are not officers
of banks. On December 5, 1935, the Board announced that in
conformity with that policy and since the new Board would
take office on February 1, 1936, vacancies occurring on Janu­
ary 1, 1936, in the office of its appointees would be filled by the
new Board.
On December 31, 1935, the total number of officers and em­
ployees at the head office and branches was 476, which includes
permanent and temporary personnel, the latter being 10.
On December 31, 1934, the total number of permanent and
temporary officers and employees was 468, of which the tem­
porary personnel was 43.
FISCAL AGENCY OPERATIONS
The volume of transactions handled as Fiscal Agency of the
United States during the year 1935 showed an increase over
the year 1934.
During the year 1935, 95 new issues of securities were

[16]

floated, as compared with 76 in 1934, and there were 71 matur­
ing issues handled, as compared with 56 in 1934.
The volume of interest coupons handled for payment during
the year 1935 shows a slight increase over 1934.
OPERATION OF BRANCHES
The volume of business handled at the El Paso Branch in
1935, compared with that handled in 1934, is reflected in the
following table:
Number
1935
1934
84
Discounts and advances___
Bills received and counted .3,213,098
Coin received and counted .1,511,499
4,259
Transfers of funds___ _____
....
2,550,472
Check collections
Treasury warrants ........
376,137
Non-cash collections . .
. 13,427
46,481
Return items . ............... . . . .

6
3,547,191
1,555,938
4,874
2,172,908
616,702
14,270
36,794

Amount
1935
1934
$

39,025
13,476,100
317,452
98,323,421
316,650,065
36,370,922
12,298,015
2,003,400

$
95,673
13,439,190
326,570
81,361,777
265,849,823
46,686,434
10,219,347
1,574,161

A t the beginning of the year 32 member banks (28 national
banks and 4 State banks) were attached to the branch. Dur­
ing the year the membership of 1 national bank was term­
inated, while the membership of 1 State bank was added,
leaving the total membership on December 31, 1935, at 32, con­
sisting of 27 national banks and 5 State banks.
The expense of operation, excluding furniture and equip­
ment, was $98,311 as compared with $93,623 in 1934.
The personnel of the branch at the close of December 31,
1935, comprised 2 officers and 37 employees (1 temporary),
compared with 2 officers and 39 employees on December 31,
1934.
The volume of business handled at the Houston Branch in
1935, compared with that handled in 1934, is reflected in the
following table:
Number
1935
1934

Amount
1935
1934

Discounts and advances
12
25 $
363,800
$538,473
Bills received and
counted
__________ 10,482,700 10,623,805
35,826,200
37,443,950
Coin received and
counted ......
11,606,898 11,365,314
1,177,031
1,234,946
Transfers of funds______
18,474
20,315 1,073,606,305 886,822,316
Check collections _______ 6,393,741 5,505,620 1,190,964,898 1,088,448,963
Treasury warrants _____
756,086 1,068,116
66,034,072
81,244,017
Non-cash collections ........
51,519
61,714
79,669,701
78,529,006
Return items ..... ..............
122,300 106,943
4,655,985
4,252,983

[17]

A t the beginning of the year 85 member banks (72 national
banks and 13 State banks) were attached to the branch. The
same membership prevailed at the close of the year, although
1 national bank (First National Bank of Alto, Texas) went into
voluntary liquidation at the close of December 21, 1935, and
its membership is in the process of being terminated.
The expense of operation, excluding furniture and equip­
ment, was $152,430, as compared with $140,630 in 1934.
The personnel of the branch on December 31, 1935, com­
prised 2 officers and 61 employees, compared with 2 officers
and 54 employees on December 31,1934.
The volume of business handled at the San Antonio Branch
in 1935, compared with that handled in 1934, is reflected in the
following table:
Number
1935
1934
Discounts and advances_______
67
28
Bills received and
counted ....................................9,233,345 8,706,626
Coin received and
counted ....................................6,797,083 5,275,821
10,410
11,094
Transfers of funds ....................
Check collections ........................5,730,057 5,032,824
Treasury warrants __
541,866
864,832
35,905
31,896
Non-cash collections ...............
Return items ..............
118,232
104,546

Amount
1935
1934
$

205,646

32,724,950

$154,660
32,648,410

823,718
705,823
338,956,044 285,700,473
860,088,294 736,974,871
51,756,435 56,552,144
46,751,934 38,734,017
4,068,437 4,208,614

A t the beginning of the year 73 member banks (65 national
banks and 8 State banks) were attached to the branch. During
the year the membership of 2 national banks was terminated,
while the membership of 1 national and 1 State bank was
added, leaving the total membership on December 31, 1935, at
73, consisting of 64 national banks and 9 State banks.
The expense of operation, excluding furniture and equip­
ment, was $136,721, as compared with $128,087 in 1934.
The personnel of the branch on December 31, 1935, com­
prised 2 officers and 54 employees (1 temporary), compared
with 2 officers and 51 employees on December 31 ,193 4; includ­
ing on December 31, 1935, 6 employees whose time is devoted
exclusively to our activities as Custodian and Fiscal Agent for
the Reconstruction Finance Corporation.

[18]

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