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F e d e r a l R e s e r v e Ba n k OF DALLAS Dallas, Texas, February 6, 1953 THE CONDITION AND EARNINGS OF MEMBER BANKS ELEVENTH FEDERAL RESERVE DISTRICT To the Member Banks of the Eleventh Federal Reserve District: Most of the principal categories of assets and liabilities of all member banks in the Eleventh Federal Reserve District showed further substantial expansion during 1952. Total resources, loans, investments, deposits, and capital accounts rose to record end-of-year totals. Net profits also rose during the year. These changes are reflected in the comparative statement of condition and the com parative statement of earnings and expenses presented on the inside pages of this letter. Loans of member banks rose $286,592,000, or 11.1 percent, during 1952, to a total of $2,857,021,000. This expansion compares with an increase of $164,241,000, or 6.8 percent, during 1951. Although a rather strong demand for bank loans prevailed generally over the District, reflecting continued high levels of business, industrial, and agricultural activity, the reserve city member banks accounted for 61.5 percent of the total loan expansion. Consumer-type lending of the District’s member banks showed a marked increase, especially after the suspension of consumer credit restrictions early in May. Consumer-type loans rose $134,283,000, or by almost one-fourth, with this increase accounting for 46.3 percent of the total loan expansion during the year. The principal changes in other categories of loans include increases of $87,774,000 in commercial and industrial loans, $23,835,000 in loans to farmers, and $22,605,000 in loans for financing security transactions. Real estate loans rose $17,049,000, or 6.8 percent. Investments of member banks rose $104,165,000, or 3.8 percent, during 1952 to a total of $2,872,845,000. Holdings of Government securities increased $83,353,000, or by a slightly smaller amount than in 1951, while investments in municipals and other securities rose $20,812,000. Country member banks accounted for approximately 56 percent of the increase in investment holdings. Reflecting principally the expansion of loans and investments and a net inflow of funds from outside the District, deposits of member banks increased $448,699,000, or 5.8 percent, to a total of $8,191,497,000. Most categories of deposits showed increases. Although a rise of $228,084,000, or 4.5 percent, in demand deposits of individuals and businesses accounted for approximately one-half of the total deposit expansion, the most notable trend in deposits was reflected in a sharp increase in time deposits of individuals, partnerships, and corporations. Member banks reported an increase of $84,080,000, or 14.2 percent, in this category, with reserve city and country banks sharing equally in the expansion. Attractive rates on savings accounts and the maintenance of general economic stability at high levels were factors conducive to this trend. Member banks increased total capital accounts $52,351,000, or 11.3 percent, reflecting favorable earnings, conservative dividend policies, and sale of new capital stock. On December 31, total capital accounts amounted to $516,378,000, or 5.9 percent of total assets and 15.1 percent of risk assets. Net profits of the District’s member banks in 1952 amounted to $40,988,000, an increase of $1,595,000, or 4.0 percent, over net profits in 1951. Earnings from current operations rose rather sharply, due principally to increased earnings from loans. Approximately 94 percent of the increase in operating earnings was absorbed, however, by increases in current operating expenses, noncurrent charges and transfers to valuation reserves, and taxes on net income. Yours very truly, R. R. GILBERT President This publication was digitized and made available by the Federal Reserve Bank of Dallas' Historical Library (FedHistory@dal.frb.org) COMPARATIVE STATEMENT OF CONDITION OF MEMBER BANKS ELEVENTH FEDERAL RESERVE DISTRICT (Amounts in thousands of dollars) December Item 31, 1952p Loans, including overdrafts_______________________ 2,857,021 U. S. Government obligations, direct and guaranteed.. 2,446,234 344,106 Obligations of states and political subdivisions______ 82,505 Other securities _________________________________ TOTAL LOANS AND INVESTMENTS_____________ 5,729,866 Cash and balances due from banks_________________ 2,901,165 TOTAL ASSETS ____________________________________ 8,777,563 Individual — Demand deposits____________________ 5,288,225 675,396 Individual — Time deposits ______________________ Deposits of U. S. Government, including postal 177,203 savings________________________________________ 630,878 Deposits of states and political subdivisions________ Deposits of banks________________________________ 1,275,769 144,026 Other deposits___________________________________ TOTAL DEPOSITS ______________________________ 8,191,497 516,378 TOTAL CAPITAL ACCOUNTS ___________________ 30 Borrowings from Federal Reserve Bank___________ 477 All other borrowings______________________________ 34.9% Ratio of loans to total deposits____________________ Ratio of cash and balances due from banks to total 35.4% deposits _______________________________________ Ratio of total capital accounts to risk assets (total 15.1% assets less Government securities and cash assets) 634 Number of banks_________________________________ September 5, December 31, 1952* 1951r 2,726,099 2,330,328 337,922 73,109 5,467,458 2,387,804 7,978,187 5,030,018 653,596 2,570,429 2,362,881 325,498 80,301 5,339,109 2,799,448 8,267,437 5,060,141 591,316 168,269 539,649 920,384 72,212 7,384,128 517,357 29,800 3,143 36.9% 128,940 588,836 1,219,326 154,239 7,742,798 464,027 — 0— 14 33.2% 32.3% 36.2% 15.9% 634 14.9% 633 p— Preliminary, r— Revised. PRINCIPAL ASSET AND LIABILITY ITEMS OF MEMBER BANKS, 1940,1945-52 ELEVENTH FEDERAL RESERVE DISTRICT (In thousands of dollars) December 31 1940 1945 1946 1947 1948 1949 1950 1951r 1952p r— Revised, p—Preliminary. Total Deposits Total Loans Total Investments Total Loans and Investments Total U. S. Gov. Secs. Total Capital Accounts 1,738,390 5,738,464 5,385,973 5,940,501 6,138,820 6,438,675 7,198,467 7,742,798 8,191,497 579,639 1,138,936 1,319,153 1,579,758 1,835,718 2,030,838 2,406,188 2,570,429 2,857,021 445,887 2,863,853 2,472,547 2,562,907 2,433,464 2,547,783 2,643,066 2,768,680 2,872,845 1,025,526 4,002,789 3,791,700 4,142,665 4,269,182 4,578,621 5,049,254 5,339,109 5,729,866 294,480 2,702,604 2,246,267 2,280,836 2,122,615 2,233,326 2,274,935 2,362,881 2,446,234 175,880 253,741 292,167 318,953 342,390 371,479 418,483 464,027 516,378 COMPARATIVE STATEMENT OF EARNINGS AND EXPENSES OF MEMBER BANKS ELEVENTH FEDERAL RESERVE DISTRICT (Amounts in thousands of dollars) Item Interest and dividends on securities___________________ 51,838 Interest and discount on loans________________________ 136,065 Service charges on deposit accounts___________________ 9,265 All other earnings___________________________________ 22,706 TOTAL EARNINGS FROM CURRENT OPERATIONS 219,874 Salaries and wages__________________________________ 65,202 Taxes other than net income_________________________ 11,960 All other expenses___________________________________ 54,036 TOTAL CURRENT OPERATING EXPENSES______ 131,198 NET EARNINGS FROM CURRENT OPERATIONS . 88,676 Total recoveries, transfers from valuation reserves, and profits ___________________________________________ 6,008 Total losses and charge-offs, and transfers to valuation reserves ________________________________________ 21,048 Profits before income taxes__________________________ 73,636 Taxes on net income_________________________________ 32,648 NET PROFITS ___________________________________ 40,988 Cash dividends declared1 _____________________________ 19,742 Number of banks___________________________________ 634 Net Change 1952 over 1951 1951r 1952p 45,307 118,925 8,743 20,035 193,010 57,977 10,441 44,415 112,833 80,177 6,531 17,140 522 2,671 26,864 7,225 1,519 9,621 18,365 8,499 6,172 — 164 20,191 66,158 26,765 39,393 17,531 633 857 7,478 5,883 1,595 2,211 1 1 Includes interest on capital notes and debentures, p— Preliminary, r— Revised. PRINCIPAL ITEMS OF EARNINGS AND EXPENSES OF MEMBER BANKS 1940, 1945-52 ELEVENTH FEDERAL RESERVE DISTRICT (Amounts in thousands of dollars) Year 1940 1945 1946 1947 1948 1949 1950 1951r 1952p Total Earnings from Current Operations Total Current Operating Expenses1 Net Earnings from Current Operations1 48,376 84,576 105,947 119,929 139,551 152,560 173,424 193,010 219,874 33,700 53,860 62,574 73,015 83,412 91,903 101,975 112,833 131,198 14,676 30,716 43,373 46,914 56,139 60,657 71,449 80,177 88,676 Total Total Losses Recoveries and and Profits2 Charge-Offs2 7,123 11,299 10,261 7,006 6,781 5,832 7,399 6,172 6,008 7,649 8,515 8,708 10,000 21,934 18,542 16,932 20,191 21,048 Net Profits Cash Dividends Declared3 Number of Member Banks 14,150 24,078 32,635 30,995 28,556 33,681 41,995 39,393 40,988 7,381 9,715 11,078 11,939 13,051 13,725 15,081 17,531 19,742 568 585 595 613 618 623 630 633 634 1 Taxes paid on net income were included in expenses prior to 1942 but for 1942 and subsequent years were treated as a deduction from total profits; hence, the data on current operating_expenses and net earnings from current operations after 1941 are not strictly comparable with those for prior years. 2 Beginning with 1948 includes transfers from and to reserves. 3 Includes interest on capital notes and debentures. r—Revised, p— Preliminary.
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