The full text on this page is automatically extracted from the file linked above and may contain errors and inconsistencies.
67TH CONGRESS \
1st Session
)
Q 1 ? 1 S j A m-™
J DOCUMENT
SENATE
j
No< ?5
EXPENSES OF
FEDERAL RESERVE BANKS
LETTER
FROM THE
GOVERNOR OF THE FEDERAL RESERVE BOARD
TRANSMITTING
IN RESPONSE TO A SENATE RESOLUTION OP
OCTOBER 14, 1921, CERTAIN INFORMATION RELATIVE TO THE NUMBER AND SALARIES OF EMPLOYEES OF THE FEDERAL RESERVE BANKS;
EXPENDITURES IN THE ERECTION OF BUILDINGS; EXPENSES OF GENERAL ADMINISTRATION,
AND THE AMOUNT OF NET EARNINGS PAID TO
THE GOVERNMENT AS FRANCHISE TAX
OCTOBER 20 (Calendar day, NOVEMBER 1), 1921.—Referred to the
Committee on Banking and Currency and ordered
to be printed with illustrations
WASHINGTON
GOVERNMENT PRINTING OFFICE
1921
EXPENSES OF FEDERAL RESERVE BANKS.
FEDERAL RESERVE BOARD,
OFFICE OF THE GOVERNOR,
Washington, October 31, 1921.
Subject: Response to S. Res. 153.
SIR: On October 18, 1921, the Federal Reserve Board received
from the Secretary of the Senate a resolution of the Senate (S. Res.
153), dated October 14, 1921, reading as follows:
Whereas, it is charged in the public press of the country and upon the floor of the
Senate that the Federal Reserve Board has been guilty of an amazing waste of public
money in increase of salaries to officers and employees of the New York Federal
Reserve Bank; and
Whereas, since 1918 in the New York branch alone they have increased the number
of officers and employees 279, or about 10 per cent, while they have increased the
salaries about 50 per cent, paying its officers and employees all the way from $10,000
$12,000, $25,000, $30,000 and one as high as $50,000, and that prior to 1918, 60 per
cent of these officers never received over $1,500 to $2,500, but are now drawing
salaries as high as $10,000; and
Whereas, the official reports of the Federal Reserve Board show that in the calendar
year of 1920 the Federal Reserve Bank of New York's pay roll amounted to $4,639,273, and for the calendar year 1918 the pay roll was $3,104,830, showing an actual
increase in pay roll since the close of the war of $1,534,443; and
Whereas, it is charged that the governor of the Federal Reserve Board has stated
that the employees of the Federal reserve banks are not paid by the Government
nor paid out of revenue derived from taxation, but are private business men and in
the banking business to make money; and
Whereas, under the provisions of section 7 of the Federal reserve act a large per cent
of the net receipts made and saved by the Federal board shall be paid into the
Federal Treasury, and if the allegations herein made are true the Treasury of the
United States has been deprived of a vast sum of money; Therefore be it
Resolved, That the Federal Reserve Board, as early as practicable, be, and it is
hereby, directed to furnish to the Senate the number of employees, together with
their respective salaries, employed by the Federal Reserve Bank in New York, as
well as in the other Federal reserve banks in the country, and the expenditures made
by each branch bank in the erection of public buildings and the general expenses in
the administration of each Federal reserve bank, and how much of the net earnings
have been paid to the United States as a franchise tax.
The board begs leave to call attention to a clause in section 10 of
the Federal reserve act, which reads: "The Federal Reserve Board
shall annually make a full report of its operations to the Speaker of
the House of Representatives, who shall cause the same to be printed
for the information of the Congress/7
In compliance with the law the Federal Reserve Board has submitted reports for the years 1914 to 1920, both inclusive. These
reports have described in detail and at great length the operations of
the Federal reserve banks, and there have been transmitted with
them exhibits showing the salaries paid by the several Federal
reserve banks to officers and employees, except that the report for
1914 shows the salaries paid senior officers only. In that report
3
4
EXPENSES OF FEDERAL RESERVE BANKS.
(p. 190) the board stated that while it had in a few cases approved the
salaries fixed by banks for officers other than the governor, as the
banks in several districts had not yet completed their organizations,
it was "not deemed advisable to give, at this time, a list, which
would necessarily be incomplete
of the salaries paid to the subordinate
officials of all the banks.77
In the report for the year 1915 a detailed list of the salaries of all
officers and employees, names omitted, is given for each of the Federal
reserve banks as Exhibit J on pages 97 to 99. In the report for the
year 1916 this information appears as Exhibit N on pages 182 to 184.
In the report for 1917 it appears as Exhibit N on pages 194 to 196.
It appears in the report for 1918 as Exhibit N on pages 244 to 246.
In the text of the report for that year (p. 29) attention was called to
the great expansion of the business of the Federal reserve banks with
the consequent necessity of making large additions to their working
forces. The number of officers and employees in all departments at
each of the Federal reserve banks at the close of the year was summarized on the same page. In the report for the year 1919 a statement of personnel and salaries at all Federal reserve banks appeared
as Exhibit M on pages 274 to 277. In the text of that report, on
page 34, a table was given showing the number of officers and employees at each Federal reserve bank at the close of the year 1919 as
compared with the number at the end of the previous year, and
attention was called also to the average salary paid officers and
employees by each Federal reserve bank (p. 35). The report for
the year 1920 shows the salaries of officers and employees of the
Federal reserve banks, as of December 31, 1920, on pages 272 to 274.
These tables have, in each instance, since the establishment of
branches of Federal reserve banks, included the salaries paid at the
branches.
In its annual report for the year 1918 (p. 30-31), the board called
attention to the fact that the great increase in volume of business
had rendered it necessary for all Federal reserve banks to arrange for
the acquisition of permanent quarters and gave in detail the expenditures that had been made by several of the banks for building sites
and the erection of buildings. Similar information was given in the
report for 1919 (pp. 37-38) and in the report for 1920 (pp. 93-96).
In addition to this the sum total of these investments, as carried on
the books of all Federal reserve banks, covering both their head
offices and their branches, appears in the statement which the Federal Reserve Boardpublishes each week for the 12 Federal reserve
banks combined. This item appears also each week in the separate
statements published by each Federal reserve bank.
AUTHORITY OF DIRECTORS OF FEDERAL RESERVE BANKS AND SUPERVISORY POWERS OF FEDERAL RESERVE BOARD.
Inasmuch as the resolution of the Senate refers to the "New York
Branch77 and to "the expenditures made by each branch bank in
the erection of public buildings," the board respectfully submits a
brief statement regarding the character of the Federal reserve banks.
In doing so the board disclaims any intention of seeking to evade
responsibility in the matters referred to in the resolution of the Senate,
EXPENSES OF FEDERAL RESERVE BANKS.
5
but merely desires to avoid any possible grounds for misunderstanding the nature of its responsibility.
The Federal reserve act did not establish a central bank. On the
contrary, it made possible the establishment of as many as 12 Federal
reserve banks, each almost wholly independent of the others in operation as well as in local policies. From a legal standpoint these banks
are private corporations organized under a special act of Congress,
namely, the Federal reserve act. They are not in a strict sense of
the word Government banks, but are only quasi governmental institutions in that they are under the general supervision of the Federal
Reserve Board and have on their boards of directors three men
representing the Government, who are appointed by the Federal
Reserve Board.
Each bank has nine directors, and the other six are chosen by the
member banks, which are the sole stockholders of the Federal reserve
bank. Section 4 of the Federal reserve act provides that each Federal reserve bank after receiving its charter from the Comptroller of
the Currency " shall become a body corporate and as such * * *
shall have power—
First. To adopt and use a corporate seal.
Second. To have succession for a period of 20 years from its organization unless it is
sooner dissolved by an act of Congress or unless its franchise becomes forfeited by some
violation of law.
Third. To make contracts.
Fourth. To sue and be sued, complain and defend in any court of law or equity.
Fifth. To appoint by its board of directors such officers and employees as are not
otherwise provided for in this act, to define their duties, require bonds of them and
fix the penalty thereof, and to dismiss at pleasure such officers or employees.
Sixth. To prescribe by its board of directors by-laws not inconsistent with law,
regulating the manner in which its general business may be conducted and the privileges granted to it by law may be exercised and enjoyed.
Seventh. To exercise by its board of directors or duly authorized officers or agents
all powers specifically granted by the provisions of this act and such incidental powers
as shall be necessary to carry on the business of banking within the limitations prescribed by this act.
Section 4 further provides that " every Federal reserve bank shall
be conducted under the supervision and control of a board of directors. The board of directors shall perform the duties usually appertaining to the office of directors of banking associations and all such
duties as are prescribed by law." It is also provided in section 4
that "any compensation that may be provided by boards of directors of Federal reserve banks for directors, officers, or employees shall
be subject to the approval of the Federal Reserve Board."
Section 11 of the Federal reserve act authorizes and empowers the
Federal Reserve Board—
(/) To suspend or remove any officer or director of any^ Federal reserve bank, the
cause of such removal to be forthwith communicated in writing by the Federal
Reserve Board to the removed officer or director and to said bank.
(g) To require the writing off of doubtful or worthless assets upon the books and
balance sheets of Federal reserve banks.
(h) To suspend, for the violation of any of the provisions of this act, the operations
of any Federal reserve bank, to take possession thereof, administer the same during
the period of suspension, and, when deemed advisable, to liquidate or reorganize
such bank.
(j) To exercise general supervision over said Federal reserve banks.
Section 21 of the Federal reserve act prescribes that "the Federal
Reserve Board shall, at least once each year, order an examination
6
EXPENSES OF FEDEEAL RESERVE BANKS.
of each Federal reserve bank, and upon joint application of 10 member banks the Federal Reserve Board shall order a special examination and report of the condition of any Federal reserve bank."
Other sections of the act empower the Federal Reserve Board to
prescribe rules and regulations governing various transactions which
may be engaged in by Federal reserve banks, but the foregoing quotations embody all the authority which has been given the board over
the routine business and the administration of the banks. The board
is not empowered to select the officers and employees of the Federal
reserve banks, for it can appoint only the Federal reserve agent and
his assistants, nor does it initiate the salaries paid the officers and
employees of the Federal reserve banks. These are matters which
come within the scope of the authority delegated to the directors of
the Federal reserve banks in section 4 of the act.
The law makes it clear that in approving compensation proposed
by the directors the board must necessarily be governed in large
measure by their representations. The directors are immediately
responsible for the administration of the bank and are familiar with
the requirements for its efficient operation, with the qualifications of
the officers and employees, with local conditions, such as cost of living, competition for services by member and other banks of the community, and the fair value of the services rendered. The duty of the
directors as to the management of a Federal reserve bank is quite
analogous to that of directors of national banks with respect to those
institutions. The Federal Reserve Board has not approved in a perfunctory way salaries proposed by Federal reserve bank directors,
but has always called for full information before taking action. In
some cases it has withheld approval pending the personal presentation of the matter by a committee of the directors, and in other
instances it has declined to approve compensation proposed. But
the board has taken the position generally that as the directors are
primarily responsible for the operation of the banks, great weight
must be given to their representations. There is appended, as
Exhibit A, a list of the directors of all Federal reserve banks and
branches.
FEDERAL RESERVE BANK BUILDINGS.
The buildings owned by the Federal reserve banks, or which are
now in course of construction, are not, in the view of the board,
"public buildings." They constitute a part of the invested assets of
the respective banks, the funds for their acquisition or construction
were not provided by a congressional appropriation, the title is vested
in the Federal reserve bank and not in the United States, and they
are subjct to State and local taxation. ("Federal reserve banks,
including the capital stock and surplus therein, and the income
derived therefrom shall be exempt from Federal, State, and local
taxation, except taxes upon real estate." Sec. 7.)
At the instance of the Federal Reserve Board a bill was introduced
during the third session of the Sixty-fifth Congress to amend section
7 of the Federal reserve act by permitting Federal reserve banks to
create a maximum suplus out of earnings equal to 100 per cent of
their paid-in capital, instead of 40 per cent, as originally provided.
When the Committees on Banking and Currency of the Senate and
House of Representatives were considering this bill early in the year
EXPENSES OF FEDERAL RESERVE BANKS.
7
1919; the governor of the Federal Reserve Board called the attention
of the committees to the fact that all Federal reserve banks would be
obliged to acquire or construct their own buildings as it was not practicable to lease adequate quarters and otherwise provide suitable
vaults for the custody of the large amounts of cash and securities held
by the banks. Especial attention was called to the large expenditures which would have to be made in providing buildings, and one
argument made in favor of the bill was that the banks should be permitted to 7increase their surplus in order to reduce the proportion to
the banks capital account of the fixed assets represented by the
buildings. The committees were so impressed with this argument
that the bill as reported, which became the act of March 3. 1919,
amending section 7, went beyond the board's recommendations and
provided that Federal reserve banks might create a surplus out of
earnings equal to 100 per cent of their subscribed capital, plus 10 per
cent of the net earnings annually, after such a surplus had been created.
There does not appear to be any specific requirement anywhere in
the Federal reserve act that the board should approve the expenditures made by the Federal reserve banks in their building operations,
but under its power of general supervision the board informed the
banks that they would be required to submit for the consideration of
the board all options for the purchase of real estate, all plans and
specifications for buildings and vaults, and that they should not enter
into any contracts involving expenditures for these purposes until
authorized to do so by the board.
In order that the board might be in position more intelligently to
pass upon these various matters, it decided to employ a consulting
architect who should devote his entire time to Federal reserve building projects. In the interest of economy it was determined to engage
as consultant the same architect who had already been employed in a
similar capacity by the Federal Reserve Bank of New York. Mr.
Alexander B. Trowbridge, of the firm of Trowbridge & Ackerman,
architects, of New York City, was induced to sever his connection
with his firm and to enter into the employ of the Federal Reserve
Board as consulting architect, at an annual salary of $6,666.66, which
has not been increased. This is one-third of his total salary of
$20,000, the other two-thirds being paid by the Federal Reserve
Bank of New York.
He began his work in April, 1919. At that time only one Federal
reserve bank building—that at Atlanta—had been completed (p. 38,
annual report for 1919) and the working plans and specifications for
the Richmond and Dallas buildings were finished. Since then, the
consulting architect has appeared as consultant in connection with
the projects for New York, Boston, Chicago, Kansas City, Cleveland,
San Francisco, Minneapolis, and St. Louis, and with the new vault
at Philadelphia, the bank there being the only one which is housed
in a purchased building. He has also been consulted in connection
with the additions to the Atlanta bank, the annex buildings in
Richmond and New York, and with branch banks in Buffalo, New
Orleans, El Paso, Houston, Louisville, Nashville, and Oklahoma
City.
As consulting architect he has—
(1) Discussed with bank officers the property under consideration
for purchase, and advised as to its advantages and disadvantages.
8
EXPENSES OF FEDERAL RESERVE BANKS.
(2) Advised bank officers in the matter of selecting an architect.
(3) Consulted with the banks and their architects as to the size,
design, and planning of the proposed buildings, during the preliminary stages.
(4) When working drawings and specifications were completed,
examined them for the purpose of detecting and having eliminated
any wasteful or extravagant features.
(5) Advised the banks and their architects as to the best methods
of vault construction, so as to obtain the maximum amount of protection for the money expended.
(6) Consulted with and advised the banks in connection with the
selection of contractors.
(7) Assisted the banks in drawing up contracts, both by preparing contracts and by studying and analyzing contracts prepared by
others for the signatures of the banks.
(8) Acted as arbiter in case of disputes where contractors claimed
extras which the banks did not consider justified.
(9) Advised as to the necessity for changes, additions, and omissions during the course of construction of the buildings.
(10) Reported to the Federal Reserve Board from time to time
in connection with the above activities.
There has been no attempt to exercise centralized control. The
services have been advisory and not mandatory in character. It
has been possible, through a tactful presentation, to apprise bank
officers and their architects of the wishes of the Federal Reserve
Board to keep designs simple and to avoid the use of meaningless
ornament and costly material. Good material simply designed and
detailed has been recommended. The underlying purpose of the
board in the employment of a consulting architect has been to
secure well constructed, serviceable buildings of dignified aspect
but without any display of costly finish which is unnecessary and in
questionable taste.
The board has recognized the necessity of adequate provision for
future growth and can cite numerous instances in growing cities
where great expense has been incurred because of shortsightedness
in omitting preparation of this kind. The office of the consulting
architect has at all times been open to bank officers and their architects. A great many conferences of importance have taken place
there and the consulting architect has personally visited a number
of the banks and has conferred with building committees in their
own cities.
All of this has been done at a very small expense to the Federal
Reserve System. The consulting architect has given up his private
practice and has devoted all of nis time to the work of the board.
His staff consists of one assistant, his secretary and stenographer,
with occasional help from a draftsman who is in the employ of
the Federal Reserve Bank of New York. It is estimated that the
total sum paid in salaries to the consulting architect and his staff
during the two and one-half years he has been in the board's service
amounts to one-twentieth of 1 per cent of the approximate amount
of all sums set apart for Federal reserve bank buildings during that
period.
There are attached hereto (Exhibit B) tables relating to the real
estate purchased by the Federal reserve banks and the building
EXPENSES OF FEDERAL RESERVE BANKS.
9
operations which have been engaged in. These tables show for each
Federal reserve bank the original investment in property purchased,
the amount expended in remodeling and in the construction of new
buildings, the amounts charged off on account of depreciation and
amortization, and the book value of bank premises accounts as of
September 30, 1921. Explanatory data have also been added showing the dates on which real estate was purchased by each Federal
reserve bank, the number of square feet of ground purchased, amounts
paid therefor, the cost of building operations to date, and the estimated cost to complete buildings in course of construction. It will
be noted from these tables that the total amount expended for
banking houses by all Federal reserve banks and branches to the
end of September, 1921, was $36,158,000, or about 60 per cent of
the amount of franchise taxes paid to the Government at the end
of 1920 and about the same proportion of the amount which it is
estimated will be paid to the Government at tne end of the year 1921.
It should be borne in mind, however, in considering building operations that the Federal reserve banks in acquiring building sites and
constructing bank buildings are making capital expenditures and
consequently these operations de not diminish in any way the
amount of franchise taxes payable to the United States Government.
The amount of the franchise tax is adversely affected only to the
extent that the Federal reserve banks are authorized to charge
depreciation and amortization allowances on their bank premises to
current net earnings.
As the Federal Reserve Bank of New York has engaged in the
largest and most expensive of all the building projects, and as it has
been made the subject of especial criticism, the board submits herewith (Exhibit C) copy of a statement which has already been submitted by the governor of that bank to the Joint Commission of
Agricultural Inquiry of Congress. This statement sets forth in
minute detail all facts regarding the acquisition of the real estate,
employment of architects, preparation of plans and specifications,
letting of contracts, and scope of the building. There are appended
also tables showing the large volume of routine operations of the
bank, which call for the employment of a large force of employees,,
whose number in turn renders a large building necessary.
The board wishes to add that like care has been taken in the preparation of plans and specifications for all other Federal reserve bank
buildings, but elaborate statements giving details of all Federal
reserve bank buildings are not included in this response to the Senate
because of the added length such statements would give to this
communication.
SALARY POLICY OF FEDERAL RESERVE BANKS.
There have been prepared for use in this communication certain
tables which appear as Exhibit D. These tables show the number
of officers and employees of all Federal reserve banks, with officers'
salaries in detail and employees' salaries in the aggregate, and, in
addition, the general expenses in the administration of each Federal
reserve bank. They also give for purposes of comparison data as',
to the increase in the routine operations of the banks. In connection
with these tables, the board begs to remark that the officers of Fed-
10
EXPENSES OF FEDERAL RESERVE BANKS.
eral reserve banks are not officers of the United States Government
or of any of its departments. Each Federal reserve bank is now the
largest banking institution in its district and the conduct of the
business of a Federal reserve bank, which has transactions many
times greater than those of the largest of its member banks, with
great responsibilities to the member banks, to the public, and to the
Treasury of the United States, requires the services in executive and
other capacities of .trained and competent officials, who will devote
all of their time to the work of the bank, not only in the ordinary
routine but in the study of a great variety of technical subjects. It
is essential that the services be obtained of men who can be relied
upon to measure up to their duties and responsibilities.
The officers and employees of Federal reserve banks are not permitted to engage in any other business, to take part in political activities, nor to hold public office. Their service in the Federal reserve
bank is not a stepping-stone to a political career nor does it afford
means of outside financial profit. The directors of Federal reserve
banks have repeatedly pointed out to the board that it would be '
impossible to secure the services of competent and efficient officials
for the Federal reserve banks were their salaries to be measured by
the salaries paid to the political officers of the Government.
With few exceptions, all officers and employees of the Federal
reserve banks are dependent upon their salaries for livelihood. During the year 1919 the rate of compensation at Federal reserve banks
was generally advanced, both as to officers and employees. This was
due to greater competition for services, increased cost of living,
and to a very great increase in the volume of transactions. In its
annual report for 1918 (p. 29) the board discussed the necessity,
particularly with respect to junior officers and employees, of paying salaries approximating the salaries paid by the large member
banks in the cities where the Federal reserve bank are located.
Experience has shown that many of the larger members banks are
disposed to draw upon the Federal reserve banks for men to fill
high official positions. During the past six years five governors of
Federal reserve banks have resigned in order to accept executive
positions with other banking institutions at much higher salaries
than they were receiving at the Federal reserve banks, and the same
is true with respect to a considerable number of deputy governors and
junior officers. In order to retain the services of officers who are
constantly being tempted with outside offers at high salaries, it has
become necessary to recognize this competition, and while the board
has in no case approved salaries for senior officers of Federal reserve
banks as high as those paid officers of similar rank by the larger
member banks in the principal cities of the country, it has recognized
from the outset that the salaries paid junior officers, heads of departments, and clerks must be in line with those paid by the larger
member banks in the various Federal reserve cities. If, in order to
reduce expenses, the policy should be adopted of making the Federal
reserve banks mere training schools for bank officers, it does not
seem possible, because of the frequent changes involved, that the
banks would have the degree of efficiency in administration and
smoothness of operation which they would have if the compensation
paid be sufficiently liberal to retain the services of trained and capable
men.
EXPENSES OF FEDERAL RESERVE BANKS.
11
The board does not for a moment believe that the directors of anyFederal reserve bank, in fixing salaries or in authorizing expenditures
in developing the business, have been actuated by the slightest
desire to deprive the Government of the revenue which it is entitled
to receive under the terms of section 7 of the Federal reserve act,
and most assuredly the Federal Reserve Board would not be a party
to such undertaking.
In this connection the board invites attention to the views of a
former Secretary of the Treasury, and ex officio chairman-of the
Federal Reserve Board, Hon. W. G. McAdoo. At a meeting of the
Federal Reserve Board on December 14, 1918, he advocated approval
of a salary of $50,000 per annum, which the directors of the Federal •
Reserve Bank of New York had voted for the governor of that
institution, and stated that his attitude had been that during the
formative period of the Federal reserve system comparatively low
salaries should be paid until the business of the banks could be
established and a fair measure obtained of their operations and a more
accurate realization reached of the dimensions of the problems and
responsibilities of the banks7 officers, stating that previously he had
opposed an increase in the salary under consideration only because
the country was at war." He said, now that the business of the banks
had been well established and they were making large earnings for
the Government, the time had come when the office of governor of a
Federal reserve bank should command on its merits a fair and just
compensation, and that he would vote to fix the salary of the governor
of the Federal Reserve Bank of New York at the amount proposed
by the directors of the bank, to wit, $50,000 per annum. He stated
it as his view that the principle governing the fixing of salaries of
officers of Federal reserve banks should be that the salary be made
sufficiently attractive to make a man willing to adopt the Federal
reserve system as a permanent career, having its rewards in the way
of promotion like any other institution. He opposed the view that the
office of head of a Federal reserve bank should be considered on a parity
with high Government office, stating that heads of Federal reserve
banks could not be said to enjoy that magnitude of power and prestige
pertaining to high Government office, while the bank officers were yet
placed in a different position from those engaged in private institutions in that they were affected by the mutations of public life and
controlled by a changing public board.
There is transmitted herewith as Exhibit E copy of a letter, dated
October 11, 1921, touching upon the subject of salaries, which was
addressed by the governor of the Federal Reserve Board to the chairman of the Joint Commission of Agricultural Inquiry of the United
States Congress.
Since the close of the year 1918 three other distinguished men have
filled the office of Secretary of the Treasury. In view of their votes
and expressed opinions on questions relating to the salaries paid
officers of Federal reserve banks the board has no reason to believe
that they take the view that there has been " an amazing waste of
public money" in the increase of salaries to officers and employees of
Federal reserve banks or that by reason of such increases "the
Treasury of the United States has been deprived of a vast sum of
money."
It will be noted from the tables above referred to (Exhibit D) that
the salaries of the presidents of the larger banks in New York City
12
EXPENSES OF FEDERAL RESERVE BANKS.
are in several cases from 50 per cent to 100 per cent in excess of the
salary paid the governor of the Federal reserve bank and that in the
case of three of these banks there is a vice president whose salaryexceeds that of the governor of the Federal Reserve Bank of New
York. It is proper to state that while the senior officers of the
Federal reserve bank have never received any extra compensation
or bonuses, very substantial bonuses have been paid to the higher
officers by some of the national banks in various parts of the country.
For example, the examination report for 1920 of Bank A of New
York City shows that the chairman of the board received a bonus of
$35,000, the president a bonus of $30,000, one of the vice presidents a
•bonus of $25,000, and other officers received smaller amounts in
proportion to salaries paid, while all the senior officers of Bank F
received a bonus equal to 25 per cent of their annual salaries.
The salaries paid vice presidents of the larger national banks and
trust companies in New York City are much in excess of those paid
to the deputy governors and controllers of the Federal Reserve Bank
of New York, the highest salary paid to a deputy governor of the
Federal Reserve Bank of New York being $30,000, while the salaries
of vice presidents of the six New York City b.anks listed in Exhibit D
range from $30,000 to $75,000 per annum.
If the average annual salaries paid are considered, it. will be found
that the Federal Reserve Bank of New York, with 40 officers and with
a total official pay roll as of October 1, 1921, of $509,800 per annum,
paid its officers an average annual salary of $12,745, while the
average annual salary paid to officers of the six national banks listed
in Exhibit D, some, with a larger and others with a smaller number
of officers than the Federal reserve bank, ranged from $11,466 to
$28,792, the average annual salary paid by Bank E being considerably
more than twice that paid by the Federal Reserve Bank of New York.
While the average annual salary paid by Bank A appears as $11,466,
or slightly less than that paid by the Federal reserve bank, it will be
found, as above stated, that the chairman of the board of that bank
received a bonus of $35,000, bringing his total compensation for the
year up to $100,000; the president a bonus of $30,000, one vice
president a bonus of $25,000, and other officers smaller amounts in
proportion to their salaries. If bonus payments were included in
arriving at average annual salaries, the average salary paid by Bank
A would be materially in excess of that paid by the Federal Reserve
Bank of New York.
As will be seen from the tables included in Exhibit D, extra compensation or bonus payments made by the Federal reserve banks
have in most cases been limited to officers and employees receiving
$5,000 per annum or less. In a few cases bonuses have been paid to
officers receiving somewhat higher salaries, but in only two instances
have bonuses been paid to officers receiving more than $7,500 per
annum. It is proper to state that the bonuses which have been paid
to junior officers and employees have been approved by the board upon
representations from the respective boards of directors of Federal
reserve banks that their object in recommending the bonuses was to
enable the recipients to meet abnormal costs of living without making
specific increases in salary. Bonuses have been paid with the understanding that such policy was temporary only and that the payment
of bonuses would eventually be discontinued. During the present
13
EXPENSES OF FEDERAL RESERVE BANKS.
year they have all been materially reduced and in some cases abolished entirely.
The following table brings out clearly the difference in the average
salaries, exclusive of bonuses, paid by the Federal reserve banks and
by the larger member banks in the Federal reserve bank cities:
Average annual salaries paid to officers by each Federal reserve bank and by three of the
larger member banks in each Federal reserve bank city as of October, 1921,
[Bonus excluded.]
Federal reserve district.
Member
bank.
t9,679
12,745
10,125
7,792
6,696
5,677
7,946
$14,745
117,331
15,733
10,061
6,473
7,828
15,440
bank.
Boston
,
New York...
Philadelphia
Cleveland...
Richmond...
Atlanta
Chicago
1
Federal
reserve
Federal reserve district.
Federal Member
reserve bank.
bank.
St. Louis
Minneapolis..
Kansas City..
Dallas
San Francisco
$7,078
6,478
6,147
5,512
6,459
$11,675
10,621
10,313
8,767
11,409
System.
7,743
13,092
Six national banks.
It will be seen from this table that the average salary of officers in
all Federal reserve banks is $7,743, while the average salary paid by
the larger member banks in Federal reserve bank cities is $13,092, or
69 per cent in excess of that paid by the Federal reserve banks.
With reference to the statement frequently made that salaries
paid by the Federal reserve bank of New York increased 50 per cent
between the years 1918 and 1920, while at the same time the number
of officers and employees increased only 10 per cent, the board would
state that during this period the total salaries of officers and employees
increased by $1,534,443, of which amount $1,336,443 represented the
increase in salaries paid to employees and only $198,000 the increase
in salaries paid to officers. In explanation of the higher aggregate
salaries paid to employees of the Federal Reserve Bank of New York,
which increased 47 per cent during the two years as compared with an
increase in number of only 10 per cent, there is given below a table showing the average annual salary paid to employees by that bank, as of the
last day of December of each year from 1915 to 1920, both inclusive,
and as of July 1, 1921, as well as by each other Federal reserve bank.
Average salaries payable to employees of each Federal reserve bank {including branches).
[Bonus excluded.]
Dec. 31.
J u l y 1,
1921.
Bank.
1915
Boston
New York .
Philadelphia
Cleveland
Richmond
Atlanta .
St Louis
Minneapolis
Kansas City
Dallas..
San Francisco
System
*.
. .
$1,086
1,152
1,000
1,242
1 044
1,005
1,142
1,068
1,289
936
1,382
1,496
1,128
1916
$985
934
838
883
691
869
949
986
881
961
1,017
925
912
1917
1918
1919
1920
$991
1,003
796
1,020
794
1,053
1,120
953
942
1,063
919'
1,144 x
$929
1,095
983
1,183
996
998
1,094
1,028
646
1,024
1,110
1,227
$1,184
1,206
1,133
1,206
1,030
1,054
1,115
1,051
1,091
1,194
1,168
1,268
$1,271
1,456
1,258
L360
1,190
1,149
1,310
1,214
1 262
1,209
1,270
1,366
$1,401
1,471
1,266
1 383
1 233
1 281
1,408
1 326
1,288
1 442
1,447
1,521
1,004
1,062
1,163
1,319
1,402
14
EXPENSES OF FEDEKAL RESERVE BANKS.
It will be observed that the average salary paid to employees by
the Federal reserve banks was very low in 1918, being practically
on a level with salaries paid bank employees prior to the war, when
prices were about one-half of what they were in 1919 and 1920, when
the increase in the average salary paid to employees took place.
An investigation made by the Federal Reserve Bank of New York
in 1919 showed that the average annual salary, including bonus,
paid to employees by the bank was $1,440, while the average annual
salary, including bonus, paid to employees by 10 of the large New
York City banks ranged from $1,620 to $2,265. In fact, it was
found that in 6 of the banks the average salary paid employees was
in excess of $2,100. It was represented to the board that if the Federal Reserve Bank of New York was to retain* its employees it would
have to increase salaries to a level more nearly approaching salaries
paid for similar work by other banks in New York City. The fact
that the average salary paid employees by the Federal reserve bank
at the end of 1918 was only $1,095, when the cost of living index as
ublished by the Bureau of Labor Statistics of the Department of
labor was 77 per cent above the prewar level, gradually increasing
to 119 per cent in December, 1920, would seem to justify the increase
in salaries granted employees during the years 1919 and 1920.
In order that the Senate may be informed as to whether the number of officers of Federal reserve banks has increased relatively more
than the number of employees, and whether the number and salaries
of officers and employees of the Federal reserve banks have increased
more rapidly than the volume of business and routine operations of
those banks, the following table is submitted showing the changes
in personnel and salaries, the growth in the principal items of assets
and liabilities of the banks, and the increase in the volume of their
operations by years from 1915 to 1920:
E
Index of growth, 1915-1920, in number and salaries of officers and employees, and in business transacted, for each Federal reserve bank.
[1915-l.J
Officers and employees.
Officers.
Assets and liabilities.
Number. Salaries. Number. Salaries. Earning
assets.
Federal
reserve
notes in
circula- ;
tion.
Federal reserve bank.
Boston
New York . . .
Philadelphia.
Cleveland
Richmond
Atlanta . . . .
Chicago
St Louis
Minneapolis...
Kansas City
Dallas
San Francisco
. .
System
Volume Transof disactions
count
through,
and open
gold
market
settlement
operafund*
. tions.
3
5
3
5
5
4
9
5
3
7
5
8
4
5
3
4
5
4
5
3
3
5
4
5
39
40
19
31
22
11
35
22
23
22
20
51
21
29
15
21
16
9
25
14
13
20
13
26
20
95
35
39
17
18
47
42
23
21
14
93
31
12
32
33
10
10
203
17
6
11
5
53
225
989
281
244
77
66
281
224
107
113
53
263
37
88
38
238
60
41
45
36
111
70
63
74
5
4
28
20
39
18
314
50*
15
EXPENSES OF FEDERAL RESERVE BANKS.
From this table it will be seen that while both the number and salaries of officers of the New York Federal Reserve Bank were five
times as large in 1920 as they were in 1915, the number of officers
and employees combined was 40 times as large and the aggregate
salaries paid officers and employees 29 times as large in 1920 as they
were in 1915, thus indicating that the number of officers increased
relatively much less than the number of employees, and that in consequence of the decrease in the ratio of officers to employees the aggregate salaries paid to officers and employees increased much less relatively than their number.
The table below shows the gradual increase in the average number
of employees per officer for each Federal reserve bank.
Average number of employees per officer for each Federal reserve bank, including branches.
December 31—
July l,
1921.
Bank.
1916
1915
Boston
New York.
Philadelphia
Cleveland
Richmond..
Atlanta
Chicago
St. Lonis
Minneapolis
Kansas City. .
Dallas
San Francisco....
. .
...
System
1917
1918
1919
1920
4
10
14
7
6
6
12
9
6
12
7
5
13
18
21
12
15
10
21
12
17
12
12
11
34
68
31
25
17
25
39
17
24
24
27
22
52
115
46
44
31
19
40
25
32
33
39
26
62
92
58
41
30
18
44
33
40
33
29
22
59
78
83
47
36
18
47
42
45
38
31
36
51
76
85
39
36
23
39
38
38
36
27
38
8
15
31
45
44
47
44
The earning assets of the Federal Reserve Bank of New York, composed largely of bills discounted for member banks, were 95 times as
large in 1920 as in 1915; Federal reserve circulation 12 times as large;
the volume of discount and open-market operations, which were very
heavy in 1919 and 1920, 989 times as large; and transactions through
the gold settlement fund, maintained in Washington by the Federal
Reserve Board for the purpose of settling interbank transactions, 88
times as large. For all Federal reserve banks combined, total earning assets were 39 times as large in 1920 as in 1915; Federal Reserve
Circulation 18 times as large; total discount and open-market operations, 314 times as large; and transactions through the gold settlement fund, 50 times as large, while the number of officers was 5
times and their aggregate salaries 4 times as large at the close of 1920
as they were at the end of 1915; and the number of officers and employees combined, 28 times, and the salaries of all officers and employees combined, 20 times as large.
The table given below shows that the average number of employees per officer in 6 New York City banks ranged from 14 to 57,.
while the number of employees per officer in the Federal Reserve
Bank of New York, exclusive of the Buffalo branch, was 80. The
proportion of the total pay roll represented by officers7 salaries in
the 6 member banks ranged from 20 to 38 per cent, while the proportion obtaining at the Federal Reserve Bank of New York was 10
per cent. It will be noted also from this table that if officers' salaries
are related to total resources, the proportion for the larger New York
16
EXPENSES OF FEDERAL RESERVE BANKS.
City member banks ranges from about 3 to 15 times as high as that
obtaining at the Federal reserve bank.
Comparison
of personnel of Federal Reserve Bank of New York with personnel of six of
the large New York City member banks about the end of 1920.
cent of Per cent of
Average Per
pay
of total
officers'
Number of Number of number
roll
repsalaries to
employees. employees
resented
officers.
per
total
by officers' resources.
officer.
salaries.
Federal reserve bank (excluding
branch)
Bank 1
JBank 2 .
Bank 3
Bank 4 . .
Bank5
Bank 6 . .
Buffalo
34
74
122
32
14
37
73
2,734
4,259
3,222
946
726
1,093
1,054
80
57
26
29
51
29
14
10
25
21
38
20
30
32
0.024
.36
.22
.27
.068
.15
.29
If the ratio of total salary payments to total resources of each
Federal reserve bank be compared with corresponding percentages
for all national banks in each Federal reserve district it will be found
that the percentages for the Federal reserve banks are materially less
than those for the national banks, as will be seen from the following
table:
Ratio of total salary payments
Federal reserve district.
Boston
,
New York...,
Philadelphia.
Cleveland
Richmond....
Atlanta
,
Chicago
,
to total resources at Federal reserve banks and at all
national banks.
Federal
reserve
bank.
National
banks.
Per cent.
0.19
.23
.24
.21
.31
.26
.23
Per cent.
0.71
.59
.67
.72
.82
1.00
.77
Federal reserve district.
St. Louis
Minneapolis..
Kansas City..
Dallas..
San Francisco
Total...
Federal
reserve
bank.
National
banks.
Per cent. Per cent.
0.37
0.90
.30
1.08
.36
1.08
.47
1.18
.31
1.00
.25
.79
NOTE.—Based on salaries paid by Federal reserve banks during 1920 as related to their condition on
June 25, 1920, and on salaries paid by national banks during the year ended June 30, 1920, as related to
their resources on June 30, 1920. Figures for Federal reserve banks include head office and branches.
The fiscal agency work of the Federal reserve banks assumed very
large proportions during the war and has continued on a large scale
since. As an example of the volume of such transactions by the
Federal reserve banks, it may be stated that during the four years
ended December, 1920, the Federal Reserve Bank of New York
alone paid 37,816,000 Government checks and warrants, handled
159,530,000 pieces of Liberty bonds, coupons, and thrift securities
in its Government bond department, received over 90,000,000 payments on Liberty bonds sold, issued and redeemed $27,238,000,000
of certificates of indebtedness, and handled $49,394,000,000 of
deposits and withdrawals of collateral pledged as security for Government war loan deposits with depositary banks. The statement
given below, which is taken from the records of the Treasury Department, shows that for the period beginning with the first Liberty loan
EXPENSES OF FEDERAL RESERVE BANKS.
17
in 1917 and ending June 30, 1921, the 12 Federal reserve banks, in
the discharge of their fiscal agency functions, handled nearly
1,000,000,000 pieces of Government securities valued at more than
$286,000,000,000.
Liberty bonds, Victory notes, certificates of indebtedness, Treasury notes, and war savings
securities handled by the 12 Federal reserve banks, April, 1917, to June 30, 1921.
Number of
pieces.
Stock shipped to Federal reserve banks by Treasury Department
Stock returned by Federal reserve banks unissued
Delivered to public
Received frompublic for exchange, conversion, redemption, etc
,
Returned to Treasury Department canceled, account exchanges, conversions
Total
332,492,222
39,404,439
285,946,770
144,202,924
Amount.
$86,864,790,706
7,117,492,880
79,594,958,704
57,494,860,598
133,602,847
55,041,636,342
935,649,202
286,113,739,230
The board transmits herewith as Exhibit F copy of a letter addressed to it by the governor of the Federal Reserve Bank of New
York, under date of October 6, 1921, in which he discusses in detail
some of the operations of the bank and the reasons which actuated
the directors in voting the increases in salary for officers and employees which have been approved by the board. Much publicity
has been given recently to a statement purporting to show the present
salaries of certain officers of the Federal Reserve Bank of New York
as compared with their initial salaries at .the time of employment
and with salaries obtained by them previous to their engagement by
the Federal reserve bank.
The board invites particular attention to the discussion of this
matter in Exhibit F and desires to point out that in the case of nine
of these officers whose salaries have been especially criticized their
connection with the Federal Reserve Bank of New York has extended
over a period of seven years, 2 of them have been with the bank six
years, 6 four years, 1 three years, 4 two years, and 2 for one year.
Seven of these men who entered the service of the bank seven years
ago at salaries ranging from $1,500 to $6,000 per annum have been
advanced from time to time on their merits and are now receiving
salaries ranging from $8,000 to $22,000 per annum.
In all other Federal reserve banks there have been similar instances
of deserved promotion. It seems to the board that the directors of
the Federal reserve banks should be commended rather than condemned for a policy which recognizes merit and promotes loyal and
efficient employees.
There is also transmitted, as Exhibit G, copy of a letter, dated
October 26, 1921, signed by each of the nine directors of the Federal
Reserve Bank of-New York which presents the views of these directors
as to their duties and responsibilities and reviews the salary policy
of that bank.
FRANCHISE TAXES PAID TO THE UNITED STATES.
In reply to that part of the resolution of the Senate which calls for
information as to "how much of the net earnings have been paid
S. Doc. 75, 67-1
2
18
EXPENSES OF FEDERAL RESERVE BANKS.
to the United States as a franchise tax/ 7 the board would state that
until March 3, 1919, section 7 of the Federal reserve act provided
that "after all necessary expenses of a Federal reserve bank have
been paid or provided for, the stockholders shall be entitled to
receive an annual dividend of six per centum on the paid-in capital
stock, which dividend shall be cumulative. After the aforesaid
dividend claims have been fully met, all the net earnings shall be
paid to the United States as a franchise tax, except that one-half of
such net earnings shall be paid into a surplus fund until it shall amount
to forty per centum of the paid-in capital stock of such bank."
Until the year 1917 the earnings of the Federal reserve banks
were comparatively small and it was not until June 30, 1918, that
all accrued dividends had been paid by all banks. As the net earnings of the Federal reserve banks were not sufficient during 1914,
1915, and 1916 to enable them to pay all accrued dividends no franchise taxes were paid to the United States for those years. During
the year 1917, however, six of the Federal reserve banks had earnings
sufficient to pay all accrued dividends and they paid a franchise tax
to the Government at the end of the year amounting to $1,134,234
and carried a like amount to their surplus accounts (annual report
for 1917, p. 28). At the end of the year 1918, all accrued dividends
having been paid, all the Federal reserve banks were prepared to
pay franchise taxes to the United States amounting in the aggregate
to $26,728,440 (annual report for 1918, p. 29) but in view of legislation then pending the Treasury Department agreed to withhold
demand for these franchise taxes until the adjournment of Congress
on March 4. The act of March 3, 1919, amended section 7 of the
Federal reserve act so that it now reads: "After the aforesaid dividend claims have been fully met, the net earnings shall be paid to
the United States as a franchise tax except that the whole of such
net earnings, including those for the year ending December thirtyfirst, nineteen hundred and eighteen, shall be paid into a surplus
fund until it shall amount to one hundred per centum of the subscribed capital stock of such bank, and that thereafter ten per centum
of such net earnings shall be paid into the surplus." In conformity
with the law as thus amended, the Federal Reserve Bank of New
York paid into the Treasury at the end of the year 1919 as its franchise tax the sum of $2,703,894 (annual report for 1919, p. 37).
The other Federal reserve banks paid no tax as they had not then
accumulated the maximum surplus allowed by law. At the end
of the year 1920 nine Federal reserve banks paid to the United
States as a franchise tax the sum of $60,724,742 (annual report for
1920, p. 90). The Federal reserve banks of Cleveland, St. Louis,
and Dallas paid no tax as they had not yet accumulated the maximum
surplus.
The following table shows the amount of franchise taxes paid to
the United States by each Federal reserve bank as of December 31,
1917, 1919, and 1920.
EXPENSES OF FEDERAL RESERVE BANKS.
19
Franchise taxes paid to the United States Government.
Federal reserve bank.
1917
Boston
1919
$75,000
649,363 $2,703,894
New York
Philadelphia...
Richmond
Atlanta
Chicago
Minneapolis
Kansas City....
San Francisco..
116.472
40,000
215,799
37,500
1,134,234
Total..
2,703,894
1920
Total.
$2,473,499
39,318,511
363,662
204,585
2,136,288
10,394,480
524,234
2,240,228
3.069,255
$2,548,599
42,671,768
363,662
321,057
2,176,288
10,610,279
561,734
2,240,228
3,069,255
60,724,742
64,562,870
During the past year the Federal reserve banks have set up a reserve
for franchise tax, the total of which was on October 27, 1921,
$53,938,000 (weekly statement Federal reserve banks combined,
Oct. 27, 1921). This tax reserve is adjusted weekly and the total
amount shown to be due the Government at the close of business
December 31, 1921, will be paid to the Treasury on January 3, 1922.
The board trusts that this communication contains the information
desired and will cheerfully furnish at any time any additional facts
which may be called for by the Senate.
Respectfully submitted.
W. P. G. HARDING, Governor.
The PRESIDENT OF THE SENATE.
EXHIBIT A.
LIST OF DIRECTORS OF FEDERAL RESERVE BANKS AND BRANCHES.
District No. 1, Federal Reserve Bank of Boston.—Edward S. Kennard, Rumford,
Me.; Frederick S. Chamberlain, New Britain, Conn.; Thomas P. Beal, Boston,
Mass.; Charles G. Washburn, Worcester, Mass.; E. R. Morse, Proctor, Vt.; Philip R.
Allen, East Walpole, Mass.; Allen Hollis, Concord, N. EL; Jesse H. Metcalf, Providence, R. I.; Frederic H. Curtiss, Boston, Mass.
District No. 2, Federal Reserve Bank of New York.—Charles Smith, Oneonta, N. Y.;
Jas. S. Alexander, New York City; R. H. Treman, Ithaca, N. Y.; Leslie R. Palmer,
Croton-on-Hudson; Chas. A. Stone, New York City; Richard H. Williams, Madison,
N. J.; Geo. Foster Peabody, Lake George,_N. Y.; Wm. L. Saunders, New York
City; Pierre Jay, New York City.
Buffalo Branch: Clifford Hubbell, Buffalo, N. Y.; Elliott C. McDougal, Buffalo,
N Y ; Harry T. Ramsdell, Buffalo, N. Y.; Frank L. Bartlett, Olean, N. Y.; E. J.
Barcalo, Buffalo, N. Y.; Thos. E. Lannin, Rochester, N. Y.; R. M. Gidney, Buffalo,
N. Y.
District No. 3, Federal Reserve Bank of Philadelphia.—Francis Douglas, WilkesBarre, Pa.; M. J. Murphy, Clarks Green, Pa.; Jos. Wayne, jr., Philadelphia, Pa.;
Charles K. Haddon, Camden, N. J.; Alba B. Johnson, Philadelphia, Pa.; Edwin S.
Stuart, Philadelphia, Pa.; Chas. C. Harrison, Philadelphia, Pa.; H. B. Thompson,
Wilmington, Del.; R. L. Austin, Philadelphia, Pa.
District No. 4, Federal Reserve Bank of Cleveland.—O. N. Sams, Hillsboro, Ohio;
Chess Lamberton, Franklin, Pa.; Robert Wardrop, Pittsburgh, Pa.; John Stambaugh, Youngstown, Ohio; R. P. Wright, Erie, Pa.; Thomas A. Combs, Lexington,
Ky.; H. P. Wolfe, Columbus, Ohio; L. B. Williams, Cleveland, Ohio; D. C. Wills,
Cleveland, Ohio.
Cincinnati branch: Judson Harmon, Cincinnati, Ohio; Chas. A. Hinsch, Cincinnati, Ohio; W. S. Rowe, Cincinnati, Ohio; Geo. D. Crabbe, Cincinnati, Ohio;
L. W. Manning, Cincinnati, Ohio.
Pittsburgh branch: Chas. W. Brown, Pittsburgh, Pa.; Jas. D. Callery, Pittsburgh,
Pa.; Harrison Nesbit, Pittsburgh, Pa.; R. B. Mellon, Pittsburgh, Pa.; Geo. De Camp,
Pittsburgh, Pa.
20
EXPENSES OF FEDERAL RESERVE BANKS.
District No. 5, Federal Reserve Bank of Richmond.—Charles E. Rieman, Baltimore,
Md.; John F. Bruton, Wilson, N. 0.; L. E. Johnson, Alderson, W. Va.; Edmund
Strudwick, Richmond, Va.; Edwin 0. Graham, Washington, D. C; D. R. Coker,
Hartsville, S. C.; Frederic A. Delano, Washington, D. C; James A. Moncure. Richmond, Va.; Caldwell Hardy. Richmond, Va.
Baltimore branch: Chas. C. Homer, jr., Baltimore, Md.; Wm. Ingle, Baltimore,
Md.; Waldo Newcomer, Baltimore, Md.; Henry B. Wilcox, Baltimore, Md.; M. M.
Prentis, Baltimore, Md.
District No. 6, Federal Reserve Bank of Atlanta.—John K. Ottley, Atlanta, Ga.;
Oscar Newton, Jackson, Miss.; P. R. Kittles, Sylvania, Ga.; J. A. McCrary, Decatur,
Ga.; W. H. Hartford, Nashville, Tenn.; Leon C. Simon, New Orleans, La.; Edward
T. Brown, Atlanta, Ga.; W. H. Kettig, Birmingham, Ala.; Joseph A. McGord, Atlanta,
Ga.
New Orleans branch: P. H. Saunders, New Orleans, La.; A. P. Bush, Mobile, Ala.;
R. S. Hecht, New Orleans, La.; John E. Bouden, jr., New Orleans, La.; F. W. Foote,
Hattiesburg, Miss.; H. B. Lightcap, Jackson, Miss.; Leon C. Simon, New Orleans, La.
Birmingham branch: W. H. Kettig, Birmingham, Ala.; Oscar Wells, Birmingham,
Ala.; T. O. Smith, Birmingham, Ala.; W. W. Crawford, Birmingham, Ala.; John H.
Frye, Birmingham, Ala.
Jacksonville branchj John C. Cooper, Jacksonville, Fla.; Edward W. Lane, Jacksonville, Fla.; Bion H. Barnett, Jacksonville, Fla.; Giles L. Wilson, Jacksonville, Fla.;
Fulton Saussy, Jacksonville, Fla.
Nashville branch: W. H. Hartford, Nashville, Tenn.; Jas. E. Caldwell, Nashville,
Tenn.; E. A. Lindsey, Nashville, Tenn.; T. A. Embry, Winchester, Tenn.; Paul M.
Davis, Nashville, Tenn.
District No. 7, Federal Reserve Bank of Chicago.—George M. Reynolds, Chicago, 111.;
. Chas. H. McNider, Mason City, Iowa; E. L. Johnson, Waterloo., Iowa; A. H. Vogel,
Milwaukee, Wis.; J. W. Blodgett, Grand Rapids, Mich.; A. R. Erskine, South Bend,
Ind.; Wm. A. Heath, Chicago, 111.; F. C. Ball, Muncie, Ind.; James Simpson, Chicago,
111.
Detroit branch: John Ballantyne, Detroit, Mich.; Emory W. Clark, Detroit, Mich.;
Julius H. Haas, Detroit, Mich.; Charles H. Hodges, Detroit, Mich.; Robert B. Locke,
Detroit, Mich.
District No. 8, Federal Reserve Bank of St. Louis.—J. C. Utterback, Paducah, Ky.;
Sam A. Ziegler, Albion, 111.; John G. Lonsdale, St. Louis, Mo.; Rolla Wells, St. Louis
Mo.; W. B. Plunkett, Little Rock, Ark.; Le Roy Percy, Greenville, Miss.; C. P. J.
Mooney, Memphis, Tenn.; John W. Boehne, Evansville, Ind.; Wm. McC. Martin,
St. Louis, Mo.
Louisville Branch: Geo. W. Norton, Louisville, Ky.; F. M. Sackett, Louisville,
Ky.; W. C. Montgomery, Elizabeth town, Ky.; Embry L. Swearingen, Louisville,
Ky.; W. P. Kincheloe, Louisville, Ky.
Memphis branch: R. B. Snowden, Memphis, Tenn.; John D. McDowell, Memphis,
Tenn.; T. K. Riddick, Memphis, Tenn.; S. E. Ragland, Memphis, Tenn.; John J.
Heflin, Memphis, Tenn.
Little Rock branch: J. E. England, jr., Little Rock, Ark.; Moorhead Wright, Little
Rock, Ark.; Geo. W. Rogers, Little Rock, Ark.; C. A. Pratt, Little Rock, Ark.;
A. F. Bailey, Little Rock, Ark.
District No. 9, Federal Reserve Bank of Minneapolis.—Wesley C. McDowell, Marion,
N. Dak.; Theodore Wold, Minneapolis, Minn.; J. C. Bassett, Aberdeen, S. Dak.'
F. P. Hixon, La Crosse, Wis.; F. R. Bigelow, St. Paul, Minn.; N. B. Holter, Helena,
Mont.; Wm. H. Lightner, St. Paul, Minn.; C. Harry Benedict, Lake Linden, Mich.';
John H. Rich, Minneapolis, Minn.
Helena branch: R. 0. Kaufman, Helena, Mont.; Chas. J. Kelly, Butte, Mont.;
H. W. Rowley, Billings, Mont.; L. M. Ford, Great Falls, Mont.; Thomas Marlow,'
Helena, Mont.
District No. 10, Federal Reserve Bank of Kansas City.—J. C. Mitchell, Denver, Colo.;
W. J. Bailey, Atchison, Kans.; E. E. Mullaney, Hill City, Kans.; T. C. Byrne,
Omaha, Nebr.; M. L. McClure, Kansas City, Mo.; Harry W. Gibson, Muskogee, OkV;
R. H. Malone, Denver, Colo.; F. W. Fleming, Kansas City, Mo.; Asa E. Ramsay,
Kansas City, Mo.
Denver branch: John Evans, Denver, Colo.; Alva B. Adams, Pueblo, Colo.; C. C.
Parks, Denver, Colo.; A. C. Foster, Denver, Colo.; C. A. Burkhardt, Denver, Colo.
Omaha branch: P. L. Hall, Lincoln, Nebr.; R. O. Marnell, Nebraska City, Nebr.;
W. J. Coad, Omaha, Nebr.; Geo. E. Abbott, Cheyenne, Wyo.; L. H. Earhart, Omaha,
Nebr.
21
EXPENSES OF FEDERAL RESERVE BANKS.
Oklahoma City branch: Wro. Mee, Oklahoma City, Okla.; E. K. Thurmond, Oklahoma City, Okla.; Dorset Carter, Oklahoma City, Okla.; T. P. Martin, jr., Oklahoma
City, Okla.; C. E. Daniel, Oklahoma City, Okla.
District No. 11, Federal Reserve Bank of Dallas.—John T. Scott, Houston, Tex.;
B. A. McKinney, Dallas, Tex.; Howell E. Smith, McKinney, Tex.; Frank Kell,
Wichita Falls, Tex.; Marion Sansom, Fort Worth, Tex.; J. J. Culbertson, Paris, Tex.;
W. B. Newsome, Dallas, Tex.; H. 0. Wooten, Abilene, Tex.; Wm. F. Ramsey,
Dallas, Tex.
El Paso branch: W. W. Turney, El Paso, Tex.; A. P. Coles, El Paso, Tex.; A. F.
Kerr, El Paso, Tex.; U. S. Stewart, El Paso, Tex.; W. C. Weiss, El Paso, Tex.
Houston branch: R. M. Farrar, Houston, Tex.; J. J. Davis, Galveston, Tex.; Frank
Andrews, Houston, Tex.; Guy M. Bryan, Houston, Tex.; E F. Gossett, Houston, Tex.
District No. 12, Federal Reserve Bank of San Francisco.—M. A. Buchan, Palo Alto,
Calif.; C. K. Mclntosh, San Francisco, Calif.; John W. Baer, Pasadena, Calif.; J. A.
McGregor, San Francisco, Calif.; E. H. Cox, Madera, Calif.; A. B. Dohrmann, San
Francisco, Calif.; Walton N. Moore, San Francisco, Calif.; Wm. Sproule, San Francisco, Calif.; John Perrin, San Francisco, Calif.
Portland branch: Edward Cookingham, Portland, Oreg.; J. C. Ainsworth, Port
land, Oreg.; Nathan Strauss, Portland, Oreg.; Jos. N. Teal, Portland, Oreg.; F. Greenwood, Portland, Oreg.
Seattle branch: M. F. Backus, Seattle, Wash.; M. A. Arnold, Seattle, Wash.; Chas.
H. Clarke, Seattle, Wash.; Chas. E. Peabody, Seattle, Wash.; C. R. Shaw, Seattle,
Wash.
Spokane branch: D. W. Twohy, Spokane, Wash.; R. L. Rutter, Spokane, Wash.;
Peter McGregor, Hooper, Wash.; G. I. Toevs, Spokane, Wash.; W. L. Partner, Spokane, Wash.
Salt Lake branch: L. H. Farnsworth, Salt Lake City, Utah; Chapin A. Day, Ogden,
Utah; G. G. Wright, Salt Lake City, Utah; Lafayette Hanchett, Salt Lake City,
Utah; R. B. Motherwell, Salt Lake City, Utah.
Los Angeles branch: A. J. Waters, Los Angeles, Calif.; J. F. Sartori, Los Angeles;
Calif.; Henry M. Robinson, Pasadena, Calif.; I. B. Newton, Los Angele3, Calif.,
C. J. Shepherd, Los Angeles, Calif.
EXHIBIT B.
Cost of hank premises of Federal reserve banks to September 30, 1921.
[Figures include cost at head office and branches.]
Federal reserve banks.
Boston.
New York:
Banking house
Annex building
Philadelphia
Cleveland
Richmond
Atlanta
Chicago
St. Louis
Minneapolis
Kansas City
Dallas
San Francisco
Total.,
Cost of Cost of new
in Total cost Depreciavalue
Original remodeling buildings
allow- Book
course of to Sept. 30, tionances
Sept. 30,
investment.
bank
construc1921.
1921.
buildings.
charged
off.
tion.
$1,296,380
$3,160,183 $4,456,563
4,797,882
681,531
600,000 $1,099,638
1,806,235
406,150
659,922
i 568,750
2,936,149
560
i 1,311,197
615,000
730,000
32,974
399,749
39,246
520,785
232,895
16,923,580
1,811,463
$200,000
$4,256,563
5,555,954
2,210,456
1,699,638
3,410,257
2,762,936
1,074,493
5,836,684
1,311,757
867,886
3,554,801
2,214,175
1,202,456
1,841,618
147,891
1,166,848
384,235
228,434
213,248
849,062
685,000
177,738
100,000
159,344
530,795
3,714,336
2,062,565
532,790
3,026,022
2,534,502
861,245
4,987,622
626,757
690,148
3,454,801
2,054,831
671,661
17,423,013 36,158,056
6,684,213
29,473,843
758,072
1,528,925
1,197,872
2,103,014
505,743
2,900,535
252,886
2,791,827
1,775,180
448,776
22
EXPENSES OF FEDEKAL RESERVE BANKS.
Cost of bank premises of branches of Federal reserve banks to Sept. 80, 1921.
Branches.
Cost of Cost of new
in Total cost Depreciavalue
allow- Book
Original remodeling buildings
course of to Sept. 30, tion
Sept. 30,
bank
ances
investment.
construc1921.
1921.
buildings.
charged off.
tion.
Buffalo
Cincinnati
Pittsburgh
Baltimore
Birmingham
Jacksonville
Nashvillo
New Orleans
Detroit
Little Rock
Louisville
Memphis
Helena
Denver
Oklahoma City
Omaha
El Paso
Houston
Los Angeles
Portland
Salt Lake City
Seattle
Spokane
None.
$380,744
515,000
451,193
None.
None.
85,000
i 201,250
None.
85,008
175,275
None.
15,000
None.
65 000
165,000
39 004
65,843
None.
None.
115,080
None.
None
2,358,397
Total
iNet.
$380,744
921 150
451,193
$267,666
921,150
381,193
85 000
202,960
44,887
85,000
158,073
85,008
175,835
40,000
85,008
135,835
a 161,438
176,438
77,738
2107,796
143,323
65,000
197 975
146,800
209,166
65,000
197,975
146,800
209,166
115,080
115,080
$1,710
560
32,975
439,685
414,267
2
$113,744
70,000
$406,150
3,212,349
346,369
98,700
2,865,980
Completed buildings.
BOSTON.
July, 1918: Purchased property at Pearl and Milk Streets, covering 14,333 square
feet, for $1,000,000. Property sold in November, .1919, for $1,150,000.
August, 1919: Purchased property bounded by Pearl, Franklin, and Oliver Streets,
covering 40,330 square feet (on which stood old buildings razed in 1920), for $1,411,500.
The net cost of property to the bank, after paying preliminary expenses connected
with purchase and deducting profits on property at Pearl and Milk Streets, was
$1,296,379.78.
Total cost to September 30, 1921, of building in course of construction, $3,160,182.79;
estimated additional cost to complete building, $900,000.
NEW YORK.
June, 1918: Purchased property for banking house site at corner of Liberty, Nassau,
and Maiden Lane.
February-June, 1919: Purchased adjoining properties running through from Liberty
Street to Maiden Lane. Total cost of property purchased in 1918 and 1919, which
covers 45,950 square feet, was $4,797,881.72.
Total cost to September 30, 1921, of new building in course of construction is $758,071.97; estimated additional cost to complete, including vault equipment, $17,880,000.
April-July, 1920: Purchased, for annex building site, properties at corner of Gold
Street and Maiden Lane and at 10 Gold Street and at 89 Maiden Lane at a total cost of
$681,531.17. Construction of annex building started in fall of 1920; total cost,
$1,528,925.
PHILADELPHIA.
December, 1917: Purchased Horner Building on Chestnut Street, covering 19,205
square feet, which is now occupied as banking house, for $600,000.
Cost of remodeling and building vault to September 30, $1,099,637.92. Estimated
cost to complete vault in course of construction, $115,000.
CLEVELAND.
February, 1919: Purchased Masonic Temple property at Superior and Rockwell
Streets, consisting of one five-story and two four-story buildings and covering 29,763
square feet, for $910,491, including preliminary expenses connected with purchase.
EXPENSES OF FEDERAL RESERVE BANKS.
23
Total cost to September 30, 1921, of new building in course of construction was
$1,197,871.95. Estimated additional cost to complete building in course of construction, approximately, $5,000,000.
July, 1920: Bank contracted for purchase of adjoining property, covering 13,000
square feet, for $375,000.
CINCINNATI.
October, 1920: Purchased property at Fourth and Race Streets, covering 13,172
square feet, for $380,744, including preliminary expenses connected with purchase.
Building operations not begun.
PITTSBURGH.
February, 1920: Purchased property at Ninth and Liberty Avenue, covering 4,144
square feet, for $515,000, on which is a 10-story building now occupied by the branch
as a banking house. Total cost to September 30, 1920, of remodeling, $406,150.19.
RICHMOND.
July, 1916: Purchased property at Ninth and Franklin Streets, covering 11,444
square feet, for $128,435, including preliminary expenses connected with purchase.
May, 1919: Purchased Virginia Hotel property at Eighth and Franklin Streets,
covering 4,455 square feet, and separated from above property by a 20-foot alley, for
$80,293.90.
Total cost to September 30,1921, of building in course of construction, $2,103,014.19.
Estimated cost to complete building in course of construction, $260,000.
BALTIMORE.
Fall of 1917: Purchased the National Mechanics Bank building, covering 4,840
square feet, for $200,000, which is now occupied as banking house.
June, 1920: Purchased property, covering 12,500 square feet, at corner of Calvert
and Lexington Streets, for $251,192.90. This consists of three pieces of property
rented to various tenants, possession to be had at end of 1921, except from one tenant
whose lease runs to October, 1924.
Branch will probably sell the National Mechanics Bank building after building
proposed banking house on the Calvert Street property.
ATLANTA.
October, 1916: Purchased the First Presbyterian Church property, covering 18,180
square feet, on Marietta Street, for $102,500. The old church building on back of lot
was utilized in new bank building, which was constructed at a cost of $417,400.
January, 1921: Purchased the adjoining ground, covering 18,000 square feet, for
$180,000. Cost to September 30 of addition to building in course of construction,
$86,632.04. Estimated additional cost to complete building in course of construction,
$923,000.
JACKSONVILLE.
October, 1921: Federal Beserve Board authorized bank to purchase property
covering 4,770 square feet at corner of Hogan and Church Streets for $45,000.
NASHVILLE.
July, 1921: Purchased two-story building and lot on Third Avenue, covering 5,267
square feet, for $85,000, possession to be had in January, 1922. It is intended to
remodel present building for branch banking house.
NEW ORLEANS.
July, 1919: Purchased the Commercial National Bank building, on lot covering
8,475 square feet, for $238,750, including preliminary expenses connected with purchase. Old building on property was sold by branch for $37,500 to dismantle and
remove. Preliminary expenses in connection with new building contracts, $1,710.
Building operations not begun.
CHICAGO.
December, 1918: Purchased the Shedd property, covering 26,400 square feet,
bounded by La Salle, Jackson, and Quincy Streets, for $2,936,149.26.
24
EXPENSES OF FEDERAL RESERVE BANKS.
Total cost to September 30, 1921, of new building in course of construction, $2,900,534.70; estimated additional coat to complete building $4,629,000.
ST. LOUIS.
January, 1919: Purchased property occupied by the St. Louis Union Trust Co.,
corner Locust and Fourth Streets, and three adjoining properties on Fourth Street,
covering 20,367 square feet, for $540,461.50.
January, 1920: Purchased adjoining property, covering 8,274 square feet, on Locust
Street, running north from alley to Broadway, for $510,678.50; purpose being to build
on this site an addition to the banking house on the above property or to sell this
second property if found that a larger building is not required. Old elevator parts
were sold for $225.
LITTLE ROCK.
January, 1921: Purchased vacant lot covering 8,000 square feet at corner of Third
and Louisiana Streets, for $85,007.50. Building "operations not begun.
LOUISVILLE.
May, 1919: Purchased National Bank of Commerce Building, Fifth and Market
Streets (5,550 square feet), including vaults, furniture, and fixtures, for $150,275,
which is now occupied by branch as banking house.
August, 1920: Purchased adjoining vacant lot, covering 2,340 square feet, for
$25,000, for purpose of building addition to above banking house. Building operations not begun.
MINNEAPOLIS.
November, 1919: Purchased property, covering 25,575 square feet, at corner of
Marquette Avenue and Fifth Streets, for $600,000. Expenses to September 30,1921,
in connection with construction of foundation for building started in July, $91,448.23.
Final plans for new building not completed.
HELENA.
January, 1920: Purchased property of Independent Telephone Co., covering 2,475
scfuare feet, including modern, fireproof one-story building, for $15,000. Cost of
remodeling building and constructing vault, $161,437.64.
KANSAS CITY.
July, 1918: Purchased property, covering 16,675 square feet, at corner Tenth Street
and Grand Avenue, for $500,000. Cost to September 30, 1921, of banking house in
course of construction, $2,791,826.69. Estimated additional cost to complete building,
$1,280,000.
DENVER.
September, 1921: Federal Reserve Board authorized bank to purchase property covering 25,785 square feet at corner Eighteenth and Curtiss Streets, for $100,000.
OKLAHOMA CITY.
August, 1921: Purchased property, covering 10,500 square feet, at corner of Third
and Harvey Streets, for $65,000. Building operations not begun.
OMAHA.
May, 1920: Purchased the Farnum Building, a five-story and basement stone and
brick building, covering 8,712 square feet, then leased by branch as banking quarters,
for $165,000. Cost of remodeling to September 30, 1921, $32,974.50.
DALLAS.
August, 1915: Purchased for $112,500 five-story and basement fireproof building
at Commerce and Martin Streets, covering 2,500 square feet, which had been leased
by the bank since April, 1915. Cost of remodeling building, $39,246.
EXPENSES OF FEDERAL RESERVE BANKS.
25
November, 1918: Purchased property at corner of Wood and Akard Streets, covering
29,233 square feet, for $145,783.39.
August: Federal Reserve Board approved purchase of Thomas property, adjoining
above, on Wood Street and covering 4,500 square feet, for $36,619.40.
Cost to September 30 of new building in course of construction, $1,524,060.26.
Estimated additional cost to complete, $30,000.
July, 1919: Purchased lot, covering 6,000 square feet, on Myrtle Avenue, for $39,003.50, on which a two-story building, costing to September 30, 1921, $107,796.03 was
erected as permanent banking house and occupied by branch in August, 1920.
HOUSTON.
October, 1920: Purchased site covering 10,000 square feet at Fannin Street and
Prairie Avenue, for $65,842.74. Cost to September 30, 1921, of buildings in course of
construction, $143,323.60. Estimated cost to complete building, $195,000.
SAN FRANCISCO.
Summer of 1917: Purchased end of block bounded by Commercial, Sansome, and
Sacramento Streets, and in Spring of 1918 purchased remainder of block to Battery
Street. Total property purchased covers 32,863 square feet and cost, $405,705.37.
Remodeled and occupied part of property as banking house. Cost to September 30,
1921, of new building in course of construction, $448,775.85. Estimated additional
cost to complete, $3,100,000.
SALT LAKE CITY.
January, 1921: Purchased for $115,080.36 property covering 27,225 square feet at
corner of South Temple and State Streets. Building operations not begun.
EXHIBIT C.
NEW BANK BUILDING, FEDERAL RESERVE BANK OF NEW YORK.
The criticism of the building operation now being conducted by the Federal Reserve
Bank of New York is contained in the following paragraph of an address made by
John Skelton Williams in Augusta, Ga., on July 14, 1921, which appears in the record
of the hearings of the Joint Commission of Agricultural Inquiry.
"These high-salaried officials of the reserve bank, men not particularly conspicuous
either for talent or constructive achievement, have luxurious tastes. You probably
saw in the newspapers that plans were filed in New York by the reserve bank there
last Thursday for a temple of banking in New York City to cost, including land, it is
estimated, $16,000,000, probably more than t"he combined cost of the White House
and Treasury Buildings at Washington and the State capitals of a dozen States of the
Union. This building, with its luxurious and lavish appointments of marble and
brass, its auditoriums, gymnasium, club quarters, restaurant de luxe, and objects of
art, will make Solomon's Temple of old seem quite cheap by comparison."
Since April 1, 1919, the Federal Reserve Board has shared the employment of our
advising architect, who makes his office in New York, but who reports regularly to the
Federal Reserve Board in regard to the building operations of all Federal reserve banks.
Early in 1918 it became obvious to the officers and directors of the Federal reserve
bank that a bank building was essential to the safe, economical, and efficient operation of the bank. It.could not perform the important services required of it by the
Government of the United States, by the member banks, and by the public generally, .
unless it secured adequate and safe accommodations.
It appeared that the time was opportune to acquire the real estate. Real estate
conditions in New York had become greatly depressed, even demoralized, as a result
of the war. After examining all possible sites, and taking the advice of experts, it was
decided to acquire the property, or such portion as could be acquired, bounded by
Nassau, Liberty, and Williams Streets and by Maiden Lane. Purchases were gradually made until the entire block, with the exception of one small building at the
eastern end of the property, which is not essential, was purchased, at a total cost, including all fees and incidental payments, of $4,797,381.72, a little over $100 a square
26
EXPENSES OF FEDERAL RESERVE BANKS.
ioot for a total of 45,950 square feet. The value of all the buildings acquired, after
careful appraisal by experts, was written off, as the buildings would have to come
down to make way for the new structure. This resulted in charging down the real
estate by $1,703,831.72, leaving the present book value $3,094,050.
As to the care and wisdom with which this real estate was acquired, one of the owners from whom a large portion of the block was purchased told me some months ago
that we had made a remarkably advantageous purchase, as he had recently sold an
exactly similar but smaller piece of land across the street from ours at about double
the price per square foot which we had paid for our property.
As to the cost of the building, various estimates have been made. By a rigid and
exacting reduction of everything in the nature of unnecessary ornament or adornment
for the building (which always had been planned to serve utilitarian purposes only),
more expensive types of material, or more expensive forms of construction, estimates
which were made in the winter of 1920-21 have been reduced something like $4,000,000
in the most recent estimate made last March. This March estimate—the most
recent—indicated a possible outside cost for the entire building, equipment, all fees
and incidental costs, solely excepting vault equipment, which will be gradually
installed over a period of years, of $17,990,347. Deducting equipment, which should
not be charged as a part of the building cost, such as vaults, fixtures, wiring systems,
furniture, equipment, etc., makes the cost of the building proper $14,855,705, as estimated last March, an average cost per cubic foot of $1.08 for a building of about
14,000,000 cubic feet, which we are advised by architects and contractors is a moderate cost at this time for a building such as we require for the bank.
It will take at least two years to complete the construction, and probably longer.
It will be sufficiently large to cover from 50 per cent to 75 per cent expansion over
our present requirements.
The commission is first asked to consider the facts in regard to the character of the
building in contrast with the fantastic language quoted above, namely, that highsalaried officials of the bank have luxurious tastes; .that they have filed plans for a
temple of banking to cost $16,000,000, probably more than the combined cost of the
White House, the Treasury Building, and a dozen State capitols. (Observe that
there is no reference to the differences in costs of to-day and those which prevailed
when such buildings were erected.) This building, it is asserted, with its luxurious
and lavish appointments of marble and brass, its auditorium, gymnasium, club quarters, restaurant de luxe, and objects of art, will make Solomon's Temple of old seem
quite cheap by comparison.
There will be no marble and brass in this building, except the very moderate
amount of ordinary grades of marble required for floors, toilets, wainscots, and possibly marble with some kind of metal to be used for the bank screen on the first floor
of the building only, where transactions are conducted with the public. There will
be no great marble banking room; the officers' quarters will be on the tenth floor and
be plain plaster or wood rooms. The bank does not require an ornate and monumental building; it requires a building especially constructed to meet the peculiar
.and unusual character of the business which it conducts, and especially a building
which will meet the permanent needs of the bank and can be maintained in upkeep
at a minimum cost.
The " auditoriums" consist, in fact, of one assembly room of 4,600 square feet,
which will accommodate about 1,000 people out of a force of 3,000, and it is to be
built in order that the bank may continue to conduct educational work now in progress for the betterment of the service by the employees to the bank, and to enable
them to gain promotion. Many of our clerks take extension courses in universities
in New York, and it is intended to conduct regular lectures at the bank, where necessary, illustrated by charts and other graphic means upon a screen. A suitable room
such as this is also needed in which to hold meetings of the officers of the member
banks of the district, to which reference has already been made. In addition to large
meetings, this room will be capable of being divided into smaller rooms by the use
of movable partitions, for the various uses of the bank, when needed.
As to the gymnasium, the bank maintains a medical department for the benefit
of the health and morale of the force, with service alternating between three doctors
and several nurses, and a small dispensary. About a thousand cases a month are
treated. The confining character of the work of the bank is liable to be detrimental
to the health of the employees. Some part of this may be described as occupational
defectiveness. Three thousand six hundred square feet have been set aside on
the top of the building, where the medical department at their recommendation
can conduct certain simple corrective exercises to overcome the consequences, for
instance, of all day operation of an adding machine, which sometimes results in
neuritis. This is the only "gymnasium."
EXPENSES OF FEDERAL, RESERVE BANKS.
27
The club quarters consist of two rooms, one for men and one for women, each with
an area of 2,200 square feet. These rooms will be plainly furnished and maintained
in connection with the bank's library, which will enable those who desire a brief
period of rest after luncheon, or to pursue their studies, to have a satisfactory place
for the purpose. These are the "extravagant club quarters."
The restaurant de luxe, in fact, is a cafeteria. Experience in our present quarters
has shown that the employees of the bank, possibly because they are rushed with their
work, or possibly because they have not the means, get inadequate and frequently
unwholesome lunches in restaurants. To overcome this a small cafeteria has been
operated for some years in which the clerks serve themselves with a simple but
thoroughly wholesome luncheon, with one hot course. The space occupied, 1,492
square feet, is too small now to permit of serving any but the women employees.
For the first six months of this year the cost of operating this cafeteria was $53,210.54.
Of this amount, the rental of the space furnished by the bank, plus the wages of servants, was $5,722.32. The balance of the cost, $48,132.22, was paid by the employees
for their luncheons, which averaged in cost 32 cents. It is now only possible to serve
less than one-quarter of the force, but those who are served get a well-prepared luncheon
at from one-half to one-third of what it would cost in a restaurant. In the new building
two cafeterias will be provided, one for men and one for women, each with an area of
8,000 square feet, including kitchen and service, that will be operated upon the
self-service plan. Meals will be served exactly at cost, and in this space 550 people
can be served at one time in each room. It will enable all employees to lunch in the
building at moderate cost. It is the least amount of space which can be employed
to cover the possible capacity of the building, which is about 5,000 people. There
will be one or two small rooms where luncheon may be served to the officers of the
bank, or for officers of member banks, either when attending meetings at the bank,
or when visiting the bank from out of town to transact necessary business. This is
the "restaurant de luxe."
There are no objects of art to be provided for this building.
The commission's attention is called to the fact that in the opinion of the officers
of the bank and in the opinion of those who are at work on this problem, no large
building operation in New York has been conducted upon the basis of a more scientific
study of the subject than has ouis. The bank has had a consulting architect, under
salary, working upon the problem, since September, 1918, and an efficiency engineer
since August, 1918. The architects' competition was started in July, 1919. During
the year 1919 engineers to study vaults, foundations, power plant, heating, electricity,
ventilation, and plumbing were all started at work. The general contractor was
selected in December, 1919. These men have been, ever since, devoting themselves
to a thorough study of the problem. The result will show the care with which the
work has been done.
In order to obtain for the information of the commission an unprejudiced expression
of views as to the general character of the organization and the work which it is performing, a letter was sent on September 30, 1921, to the six principal architects, engineers, and contractors to whom this work was intrusted, making such inquiry as would
bring forth a frank expression of their views without disclosing the purpose for which
the report was desired. A copy of the letter asking for the reports, together with the
original letters received in reply, are herewith submitted to the commission for their
information, with the request, however, that they be not printed in the record because
of their rather confidential nature. If these letters can be returned to the bank,
copies will be substituted for the records of the commission.
The bank was unwilling to let the contract for this building at a fixed sum to one
contractor in a market where all building costs were declining. The possibility of
profit to a contractor on such a large building, containing nearly 14,000,000 cubic
feet, under present conditions would be considerable. The general contractors,
Messrs. Marc Eidlitz & Son, are undertaking the work for a very moderate fixed fee,
and all savings in declining costs will accrue to the benefit of the bank. The same
is true of the foundations, which are a costly and difficult job, the contract for which
has been let to a leading contractor in the country for a fixed fee. All subcontracts
on the building will be let by competition, subject to approval by the directors of
the bank. Large savings have already been effected due to the care and foresight
with which these arrangements were made.
In the case of the security vaults, which will be the largest ever constructed in the
United States, and the most secure, it some time ago appeared possible that the development of vault construction had proceeded upon a wrong theory in view of the
discovery of new processes for attacking and destroying steel. Last year arrangements
were made with the Bureau of Standards, through the Federal Reserve Board, to conduct an experimental test in Washington. A great variety of sample vaults of all types
28
EXPENSES OF FEDERAL RESERVE BANKS.
of construction were built at a cost of $75,000, and they were attacked by every known
means of breaking down concrete and steel, such as cutter burners, explosives, etc..
This test was for the benefit of, and the cost was borne by all reserve banks, in proportion to their resources. The estimate of the cost of the vault, prior to this test, was
$3,272,000. The plans now developed, as the result of the test, will produce a larger
vault than we had planned, probably 5 to 10 times as secure as any previously constructed, at a cost of about $1,500,000, or a saying of over $1,700,000.
As an indication of the wisdom of the decision to commence building in a declining
market, I wish to submit the following list of savings over the costs estimated as of last
March upon the contracts already let:
Wrecking old buildings
$135, 997
Steel (exclusive of vault protection)
372, 300
Steel (for vault protection, estimated)
350, 000
Cartage (for excavation work)
45, 000
Foundation subcontracts so far as let
9, 886
Stone work, estimated (by reason of certain rearrangement of construction). 300, 000
Those reductions being actual savings over estimated costs, principally due to
price reductions, relate to only a few of the contracts, but considerable further reductions in actual cost over estimated cost are anticipated.
No part of the building will be erected without competition. No extravagant
materials will be used for the facade or interior of the building. It is proposed to
obtain competitive bids for a great variety of materials, including brick, limestone,
sandstone, and other materials which can be obtained in sufficient quantity. There
is no thought of employing marble or even granite for the facade, which would be too
costly.
My statement in regard to this building would not be complete without reference to
its necessity. The motives actuating the directors of the bank (with the Federal
Reserve Board's approval) in commencing building operations are principally the
following:
The bank now occupies offices and vaults in six separate buildings in New York
City, scattered all the way from Wall Street to Forty-fourth Street, with a warehouse
formerly in Brooklyn, but now on Maiden Lane, New York City. This destroys efficiency and economy in operation. The force being so scattered causes serious inconvenience to the member banks and to the public. The cost of building is declining, and the
most advantageous time to build is on a declining market. The health and morale of
the clerks is in danger of being impaired by overcrowding, insufficient light and ventilation. And not least is the fact that there is just now considerable unemployment, and
the erection of this building will give employment to some thousands of workmen who
are badly in need of work.
A brief description of certain practical reasons for immediate construction will serve
to make clear why it can not be deferred. The bank's offices and vaults are now
located in six different buildings. Employees and officers make an average of 368
visits a month to vaults outside of the main office, which consumes the equivalent of
2,366 working days per year. Members of the auditing department, located two
blocks from the main office, make an average of 57 trips daily, consuming time equivalent to 814 working days a year. The distribution of material from the main vaults
in the Equitable Building to the nine floors occupied in that building consume time
equivalent to 15,000 hours per year. Examples of costly inefficiency of this character
could be multiplied without number.
As to the inconvenience to banks and the public, this scattered location makes it
difficult for those doing business with the bank to ascertain where they should go. Toillustrate an instance of this inconvenience, the average number of people who call
at the Government bond department, located on the twenty-fourth floor of the Equitable Building, during periods of activity is 9,963 a day. The maximum number who
have called at the partial payment department of the Government bond section of
the bank, which was until recently at Forty-fourth Street, was 17,516 in one day. The
member banks are called upon to do business at the bank on six or seven different
floors of the Equitable Building, as well as with departments located in other buildings
and at the Subtreasury.
As to the health of the force and the morale of the organization the building code
of New York sets a minimum of 50 square feet in a room with a 10-foot ceiling for
clerical workers. The bank has been so overcrowded that practically all departments
of the bank violate this provision of the code. The average area per employee in
the Equitable Building is now only 38 square feet. In certain divisions it is much
less. In the transit department, employing 300 people, it averages 29.2 square feet.
In the stenographic department, with 56 people, it averages 21.7 square feet. The
EXPENSES OF FEDERAL RESERVE BANKS.
29
money department, with 198 people, averages 32 square feet. The country collection
department, with 153 employees, averages 31.4 square feet. The Equitable Building
was designed as an office building and not to be used in large areas for large organizations. Ventilation is inadequate for the purposes of the bank, and it is believed that
this is a cause of illness among the employees. Of the total force, 700 employees, are
crowded into 30 square feet per person. The amount of light available is insufficient
and can not be increased with the building's present equipment. The bank has over
1,000 machines in use in various departments, a large number of which are adding
machines, which should be operated electrically in order to protect the clerks from
occupational disorders. This can not be done without added electrical equipment.
Since the medical department has kept a record of employees we have diagnosed 31
cases of tuberculosis in the force.
As to unemployment in New York City, this has been markedly the case in the
building trade. Certain labor organizations with which our contractors are now dealing in connection with our building have shown a disposition to cooperate in adjusting
wages where definite wage agreements do not exist. I have been advised that on
foundation work alone, in which at the peak about 2,500 men will be engaged, substantial reductions in wages have been agreed upon. The contractors of the building
have estimated that an average of 2,000 workmen per day, for a period of three years,
will be employed at the building and in the mills, quarries, and shops fabricating
the material required for the building. It is estimated that the amount of wages paid
for labor, not only in the actual construction work at the building, but in the mills
and plants where materials are fabricated, will total over $11,000,000. The work will
be actively prosecuted throughout the winter, when the problem of unemployment
is most serious. There is attached to this report a separate communication giving
various statistical material relating to the need for the bank building.
The bank is also fortunately in position to conduct this building operation with
respect to present leases. During a period of great depression in renting in the lower
part of New York favorable leases for space were made in the Equitable Building,
taking only small quarters at first in 1916, but obtaining options on further very large
areas in the building. The bank now occupies 117,907 square feet, scattered over
nine floors, the annual rental of which is $305,959, an average of $2.60 per square
foot. The estimated annual rental, on the basis of existing rental values, would be
$739,334, an average of $6.27 per square foot. In other words, this space costs the
bank $435,000 less than it would pay at present rental rates. Most of the leases extend
for some years and contain clauses which give the bank the right to cancel (upon
making a moderate payment, which decreases each year), in the event (1) that it
moves into the Subtreasury, (2) that it is dissolved by act of Congress, and (3) that
it erects its own building.
It can hardly be considered that this record gives evidence of want of forethought
or of laxness and extravagance in the management of the Federal Reserve Bank of
New York.
The data submitted in support of these general statements on the subject of our
building was not especially prepared as a reply to criticism. Most of it was already
in existence and simply represents the studies which have been made as the basis
of the decision to start building operations and consists principally of material which
has, from time to time, been submitted to the Federal Reserve Board.
The detailed records of all of these matters, together with tables and charts showing
the growth of the business of the bank which necessitated constructing this building,
are herewith submitted to the commission. They include:
1. A blue print giving diagram of the organization for directing the building
operation.
2. A statement of the method employed in the direction and control of the construction of the bank.
3. A description of the method employed in the matter of audit and control of all
expenditures.
4. A table analyzing the cost of all real estate purchased.
5. A summary of the estimated cost, as of March, 1921, including all construction
and equipment; of the net cost, deducting equipment; and the same reduced to
cubic foot basis.
6. A detailed analysis of operating conditions in various of the departments of the
bank.
7. A report of the American Institute of Banking upon the work of clerks of the
bank who take extension courses in banking. (This does not include work conducted at the bank-or in other extension courses in New York educational institutions.)
30
EXPENSES OF FEDERAL RESERVE BANKS.
8. A statement of the dates of engagement of architects, engineers, and contractors.
9. A statement of sj)ace occupied by the bank.
10. A statement to indicate the growth in the volume of the business of the bank.
11. A chart showing the relation between the total number of employees, total
pay roll, and volume of work covering the year 1920 and the first six months of 1921.
The acquisition of all real estate purchased by the bank was under the supervision
of a committee appointed by the directors, and all building operations have been
conducted under the supervision of another subcommittee of the board of directors.
BUILDING
COMMITTEE.
GOVERNOR,
CONSULTING
ARCHITECT
DEPUTY
GOVERNOR.
OWNERS
REPRESENTATIVE
COMMISSIONED
ARCHITECTS
AUDITING
-
ACCOUNTING
-
LEGAL
p
i
ENQINfEE^
,'
ARCHITECTS' 1
REPRESENTATIVE!
GENERAL
CONTRACTOR.
SUPT- OF 1
CONSTRUCTION |
C0NTRACTOR.5
DI AGR.AM - OF - THE- DIRECTION
OF-THE'NEW-BUILPlNd-OPERATION
FEDERAL-RESERVE-BANK- OF-NEW-YORK
F--R.B-OF.N-Y-
These committees, together with a committee consisting of an officer or officers of the
bank, with the architects, engineers, and contractors, met regularly, and minutes and
careful records of their proceedings are contained in the records of the bank, as are
also audited vouchers covering all expenditures made. They are at the disposal of
the commission if it is desired to examine them.
B E N J . STRONG,
Governor, Federal Reserve Bank of New
York.
EXPENSES OF FEDERAL RESERVE BANKS.
31
DIRECTION AND CONTROL OF THE CONSTRUCTION OF THE NEW BANK BUILDING.
SEPTEMBER 14,
1921.
Building committee.—All policies, plans, and proposals are subject to the approval
of a building committee of the board of directors, five in number. This committee
controls the letting of contracts.
Commissioned architects and officers' group.—The work of the commissioned architects in designing and planning the building is done subject to the immediate direction of a small group consisting of the governor of the bank; a deputy governor, who
has been specifically assigned to the work; and the consulting architect, who is also
the consulting architect of the Federal Reserve Board. Conferences are had with
controllers and managers relative to the space requirements and the detail arrangements in the various departments.
Direction of the work, supervision, and inspection.—Under their contract with the
bank the responsibility for the direction of the whole operation is, as shown on the attached chart, vested in the commissioned architects. All instructions to the general
contractor are issued by or through the office of the commissioned architects. They
are responsible for adequate supervision and inspection of the work; to see that the
work is performed in a workmanlike manner and that labor and materials are of proper
quantity and quality.
General contractor.—Under its contract with the bank, the general contractor is ta
provide all labor and material and to do all things necessary for the proper and economical construction of the building. It is to furnish efficient business administration
and adequate superintendence. All portions of the work which the general contractor's organization has not been accustomed to perform are to be executed under
separate subcontracts, the award of which is determined by the building committee.
Job meetings.—Weekly meetings are held at the office of the commissioned architects for the purpose of discussing and deciding the construction problems, receiving
bids, and determining the recommendations to be made to the building committee
a&to contract awards and other matters requiring decision. Arrangements are made
at the meeting for emergency or minor contracts and purchases. The meetings are
attended by the following persons: The governor of the bank, or, in his absence, the
designated deputy governor; the consulting architect and his assistant; two or threerepresentatives of the general contractor s office; two or three representatives of the
commissioned architects; and such consulting engineers and subcontractors as may be
required for the discussion of specific questions.
Decisions confirmed.—All actions taken by the job meetings are reported to the
building committee, and when approved are confirmed in writing by the deputy
governor or the secretary of the bank upon special serial forms addressed to the commissioned architects. Copies are issued to the auditing and accounting departments
and to the consulting architect.
Securing of bids and the award of contract—Control of estimates and securing of competition.—All plans and specifications are issued to the consulting architect at the time
they are sent to the contractors; and in case the work called for is more elaborate in
design or more costly in material than in the opinion of the consulting architect is
justified, a request is made for revised figures. The general contractor endeavors ta
secure wide competition among subcontractors in all trades, but it is the policy to
invite only bidders of such character as would be acceptable in the event that they
submitted the lowest bids. In cases such as that of the general contractor and of the
Foundation Co., where the contracts are on a cost-plus basis, wide competition is
secured in the purchase of all supplies, building materials, and tools.
Action on bids.—The general contractor submits to the commissioned archite ts a
schedule of dates on which he proposes to call for bids on all subcontracts. Before
inviting tenders he submits a tentative list of subcontractors for the approval of the
commissioned architects. When bids have been received from the approved bidders,
they are opened by the general contractor at the job meetings, are tabulated, and
copies are furnished the owner and the commissioned architects. When bids for the
work in charge of the engineers are received, such as foundations., steelwork, heating
and ventilating, vaults, etc., the several consulting engineers are present. All.bids
are analyzed at the job meetings and an agreement reached covering the recommendations to be made to the building committee. Before action by that committee, the
general contractor certifies in a written statement whether in his opinion the bid of
the subcontractor under consideration is bona fide, fair, and reasonable. Awards
are made to the low bidder, except in cases (which so far have been rare) where the
conditions imposed by the bidder are of a character to make the acceptance of his bid
undesirable.
32
EXPENSES OF FEDERAL RESERVE BANKS.
Extra work, change orders, etc.—Extras are not allowed unless authorized in writing
by a duly authorized representative of the bank. Change orders covering additions
or deductions are issued only by the commissioned architects. When in an emergency
a special order for an addition or deduction is required and prompt action is imperative, the question is presented by the commissioned architects to the owner (the designated deputy governor or the consulting architect) for approval and the action taken
is submitted to the building committee at its next meeting.
Payments—Control, inspection, and audit.—Requisitions for payments are prepared
periodically by the general contractor and submitted with vouchers to the commissioned architects who examine them and, if they find them correct, issue certificates
which are presented to the owner for payment. Certificates are made on the basis of
expenditures only when approved in writing. After presentation to the owner the
certificates are checked with the vouchers by the consulting architect. They are
then submitted to the auditor of the bank, whose approval is required before a payment is made; (The procedure followed and the files maintained by the auditor's
office is indicated by the attached memorandum.) As far as possible all checking
of bills and pay rolls is completed day by day as they are received, in order to avoid
delays at the regular periods when the general contractor presents certificates for
payments.
Supervision at the building.—In addition to the supervisors and inspectors of the
commissioned architects, the consulting architect has representatives on the job,
namely, his assistant and three timekeepers or checkers. It is the duty of the representatives of the commissioned architects and of this latter group to keep track of the
delivery of materials and supplies and to check the payrolls, and in general to observe
whether or not the decisions and desires of the building committee are being carried
out. Material and labor records are inspected, so that there may be assurance that
the bills presented for payment are correct and in proper form.
History.—A complete record is maintained by the consulting architect's office
showing the budget allowance for each trade, the amount of each contract let, the
savings and excesses, and the costs to date. This record, which is intended as a
history of the operations, also shows the dates of the start and finish of the various
subcontracts and contains a tabulation of all estimates received for subcontracts,
together with a notation of the action at the job meeting in each case.
AUDIT OF CONSTRUCTION, NEW BANK BUILDING, OFFICE ORGANIZATION AND
PROCEDURE.
Organization.—The personnel of the office is as follows: Mr. Gleason, in charge;
Mr. Knight, assistant; Mr. Roberts, representative "on the job."
Records maintained.—1. Furnished by contractor, currently: (a) Daily check list
of labor, showing employee's number, time, rate, and amount earned each day;
(6) copy of bills of material; (c) blue prints requested; (d) copy of field requisition;
(e) copy of purchase orders; (/) copy of receiving tickets; (g) copy of shipping tickets;
(h) daily progress reports; (i) advice of pay-roll changes.
2. Compiled by this office: (a) Register of authorities and contracts; (b) index of
authorities and contracts; (c) register of invoices; (d) register of requisitions for payment on contracts; (e) distribution of requisition amounts: (1) to budget account, (2)
to cost and expense account, (3) to contractor account.
3. Files maintained: (a) Purchase orders: (1) awaiting invoices; (2) cleared (receiving tickets attached); (6) receiving tickets: (1) awaiting invoices; (c) contracts; (d)
"instructions;" (e) "official actions;" (/) Marc Eidlitz "orders."
Procedure—Authorities.—(1) The minutes of the building committee are read, notes
taken, and indexed; (2) "Instructions" registered, filed numerically, and indexed;
(3) "official action" registered, filed numerically, and indexed; (4) "order" (Marc
Eidlitz <°z Son) registered, filed in order of registration, and indexed.
The index card not only directs to the desired authority, but shows whether or not
all the required steps have been taken.
Preliminary verification.—At the job office (51 Maiden Lane) by Mr. Roberts: (1)
Labor check lists a*s to number of men working; (2) receiving tickets as to material
received on job, calculations, weights of steel, board measure of lumber, etc.; (3)
shipping tickets for material sent from the "job;" (4) purchase orders; (a) that they
are properly approved as to the requirements and prices by Marc Eidlitz & Son;
(6) that they call for material or service specified on drawings or on bills of material,
or, if made from a field requisition, that the latter is properly approved; (c) that
prices are in agreement with authorized price schedule, or are equal to best bids and
quotations, if there are no price schedules.
EXPENSES OF FEDERAL RESERVE BANKS.
33
Audits of pay rolls and invoices, general office.—Invoices and pay rolls pass through
the hands of Marc Eidlitz & Son and the office of the consulting architect, by whom
they are examined and approved in accordance with procedure previously determined upon.
They are then delivered to this office, where they are verified in detail with "authorities," purchase order, receiving ticket, and other data, etc., on file; all of which
have been verified. The invoices are then marked for identification, registered (pay
rolls included), and returned to Marc Eidlitz & Son for inclusion in the regular requisition certified by the architect. Purchase orders and receiving tickets cleared are
transferred to a permanent record file.
Labor.—A skeleton pay roll is produced from the daily check list of time furnished
by Foundation Co. The total of the pay roll is known before the actual pay roll is
received. The actual pay roll is verified in its extensions, footing, and signatures.
Material end service.—Invoices are verified as to quantities and prices, by check to
the "authorities," purchase orders, and receiving tickets, etc., on file, and previously verified as to prices, necessity, compliance with specifications, etc.
Register of invoice and pay roll.—All invoices and pay rolls for which the chain of
evidence is complete are marked for identification (numbered), registered, and
returned-to Marc Eidlitz & Son. Any invoice for which the evidence is incomplete
or not satisfactory is returned without registration, to come through again after the
lacking support is supplied.
Certified requisitions for payment.—As the result of the above-described procedure,
the certified requisition contains only invoices and pav rolls previously audited
and identified. Upon receipt its items are checked to the register of invoices and
approved for payment. The requisition as a whole is then registered and distribution of its items is made to the ledger accounts, after which it passes to the expense
division for payment. Provision has also been made that should items appear in
any requisition that had not been previously passed upon and are not satisfactorily
supported, to throw them out and pass the requisition without the excepted items;
that is, the amount of the requisition will be reduced and the corrected amount
approved.
Auditing of contractor's account.—Examinations of the books and records of the
contractor will be made periodically, including such records as are maintained at
yards and shops under the control of the contractor.
Unused material and scrap.—Material recovered and scrap can only be disposed of
after listing by the general contractor and upon his authority. The procedure set up
for controlling charges for labor and material will apply in all such cases.
Small tools.—Tools not designated in contract as part of the plant will be subject
to store records and periodical inventory appraisals by the general contractor and
the bank's representatives.
Charge for plant.—The amount is specified specifically in the foundation company's
contract, and the general contractor is required to certify that the plant was furnished
during the rental period. If, subsequently, cases occur where the charge for use of
plant is not a stated amount, procedure will be established to verify the charge made
by the contractor for its use.
Payments and receipts.—All requisitions for payments must be certified by the architect and the owner's representative. Each contractor is required to execute receipts
on each payment made to him, and at the time of final payment will state specifically
that the payment is in full of all demands and (except in special cases) guarantee
the owner against any claims. Where the guaranty is not customary because of the
nature of the work a specially worded receipt has been provided in accordance with
the recommendation of the bank's legal department.
COST AND NEED OF NEW BUILDING.
Analysis of real estate purchased and cost thereof: Total amount paid to date for
"real estate to provide a site for the new building is $4,797,891.72. The following
schedule shows the parcels purchased and cost thereof:
S. Doc. 75, 67-1
3
34
EXPENSES OF FEDERAL RESERVE BANKS.
Property purchased prior to Dec. 31, 1918.
Square
feet.
Date.
June 1,1918:
33-35 Liberty Street.
41-49 Liberty Street.
48-50 Nassau Street.
30-40 Maiden Lane.
44 Maiden Lane.
48-50 Maiden Lane.
Lawyers Title
37-39 Liberty Street.
44i-46 Maiden Lane.
Zie^ler
51 Liberty Street.
42-46 Nassau Street.
Ruhnstruck
52-54 Nassau Street.
Delafield
42 Maiden Lane.
Purchase
price.
Cost per
square
foot.
Appraised
value of buildings a n d foundations
written off
Dec. 31,1918.
Present
book value.
23,000 $1,600,000.00
$69.57
$249,000.00
$1,351,000.00
5,600
610,000.00
108.92
458,000.00
152,000.00
2,700
575,000.00
212.97
67,000.00
508,000.00
580
180,000.00
310.34
20,800.00
159,200.00
1,300
121,500.00
94.23
9,000.00
112,500.00
33,180
3,086,500.00
803, SOO. 00
2,282,700.00
Property purchased since Dec. 31, 1918.
Date.
Square
feet.
Purchase
price.
Appraised
of buildCost per value
ings
and foun- Present
square dations,
etc., book value.
foot.
written off
Dec. 31,1919.
Feb. 10.1919:
Fahys
29-31 Liberty Street.
52-^54 Maiden Lane.
Mar. 1,1919:
Penfield
25-27 Liberty Street.
56-58 Maiden Lane.
Apr. 1,1919:
Bishop
23 Liberty Street.
June 26,1919:
Ely
21 Liberty Street.
Total
Total of incidental payments made in
connection with the purchase of the
above property, including $24,268.67
accrued taxes. The balance is made
up entirely of title and other fees
,
Total
Grand total
5,260
$715,000.00
$135.93
$466,000.00
$249,000.00
4,530
663,000.00
146.36
309,000.00
354,000.00
920
76,350.00
82.92
22,500.00
53,850.00
1,860
200,000.00
107.53
45,500.00
154,500.00
12,770
1,654,350.00-
843,000.00
811,350.00
57,031.72
57,031.72
45,950
1,711,381.72
4,797,881.72
900,031.72
1,703,831.72
104.00
3,094,050.00
Estimated cost of new building, submitted Mar. 22, 1921.
Foundation
Building (including builder's fee).
Vault.
Equipment.
1
Total
Architect's and engineers' fees.
16,884, 347
1,106,000
Total
1
Does not include vault equipment, estimated at $650,000.
$1, 838,000
12,170,528
1, 556, 550
1, 319, 269
17, 99Q, 347
35
EXPENSES OF FEDERAL RESERVE BANKS.
Cost, less vault and equipment, not strictly building.
Total estimated cost, as above
$17, 990, 347
is:
Vault
Equipment—
Accoustic treatment
Book-vault doors, etc
Lighting fixtures and reflectors
Low tension
Toilet accessories
Sprinkler system
Refrigerating plant
Dumb waiters and directional signal
Letters conveyor
Hospital equipment
Kitchen equipment
Furniture, etc
Fireplace and mantels
Shades
$1, 556, 550
$67, 619
16,-500
94,000
150,000
33, 500
750
20,000
14, 900
37,000
15, 000
50,000
800, 000
5,000
15,000
1,319,269
Total
2,875,819
Proportionate part of contractor's, engineers', and architect's fees
258,823
3,134,642
14,855,705
Cubic-foot contents of building, 13,870,000; average cost per cubic foot, $1.08.
Thirty and odd departments of the bank are scattered in six separate buildings. The
departments in the Equitable are on ninefloorsfrom the basement to the twenty-fifth.
These conditions result in lost motion; in some departments 30 per cent of operating
effort could be saved if proper working space were available; it is estimated that 5
per cent of the present operating effort of the bank as a whole could be saved, which
if spelled in dollars would amount to $200,000 per annum.
THE RESPONSIBILITY OP THE BANK IN CONNECTION WITH HEALTH OF EMPLOYEES.
The building code of New York sets as a minimum 50 square feet per person for
clerical workers. Because of the impossibility of obtaining additional space in this
building, we have been forced to overcrowd practically all of our departments, thereby
violating the building code. The average area per employee in this building is only
38 square feet and is even less in certain of our larger divisions, namely the following:
Name of division.
Transit.:
Stenographic
Money
Country collection
Number
of employees.
300
56
198
153
Area occupied in
square feet.
8,730
1,216
6,332
4,812
Square
feet per
person.
29.2
21.7
32.0
31.4
The conditions under which many of the employees must work in our main vault
and in the small space adjacent to the vault are dangerous to health.
The Equitable Building was designed purely as an office building, and the upper
floors were never intended to be used for banking quarters. Consequently, no provisions were made for properly ventilating large areas occupied by numbers of people.
It has therefore been necessary for us to install a limited system of ventilation which
is not and can not be entirely satisfactory. We feel that much of the illness among
our employees is directly due to poor ventilation.
Many of our divisions are insufficiently illuminated but this condition can not be
corrected because the fixture layout was originally designed for private offices, and the
current consumption of the building has now reached the peak load.
36
EXPENSES OF FEDERAL RESERVE BANKS.
GENERAL FACTORS.
The following are general factors which have an important bearing on the erection
of the new building:
(1) The tenants in the buildings on the property which the bank now owns are in
an unsettled state of mind regarding their leases. This condition has resulted in a
number of vacancies, and on May 1 there will be a general exodus. It will be practically impossible to procure new tenants due to the fact that we are not able to grant
leases for any definite periods.
(2) Our member banks are greatly inconvenienced in their business transactions
with us because of the widely scattered locations of our various departments.
(3) The constant changing and shifting of departments and divisions involves frequent expensive alterations, the amount expended for these changes to date being in
excess of $120,000.
Congestion.—The average area for an employee is 30 square feet. Seven hundred
employees are crowded into 30 square feet per person.
New York building code requires 50 square feet per person.
The Equitable Building is designed as an office building and not for the use of
persons working in large areas; the light and ventilating system is unsuited to such use.
Since the medical department have kept record of employees 31 cases of tuberculosis alone have been detected.
Inconvenience to 'public.—Scattered location and necessary constant shifting of
departments greatly inconveniences everybody dealing with the bank.
As illustration of the necessity for providing ample facilities for handling the public
the following figures are given:
Average number of people who called at the Government bond department daily
(twenty-fourth floor, Equitable Building) during the maximum periods, 9,963.
Maximum number of people who called at the partial payment department in one
day, 17,516.
Cost of present space occupied.—Total space occupied in Equitable Buliding 117,907
square feet, scattered on 9 floors.
Annual rental $305,959, average cost per square foot $2.60.
Estimated annual rental on basis of existing values $739,334, estimated average cost
per square foot, existing rates $6.27.
Options.—No option on any additional space in this building.
All space occupied except 11,300 square feet (Morris Plan space 8,000 square feet)
may be held under present leases until 1933 or 1934.
Buildings occupied since the organization of the bank.—62 Cedar Street, 120 Broadway,1
50 Wall Street, 35 Liberty Street, 37 Liberty Street, 43 Liberty Street,
19 West Forty-1
1
fourth Street, Pioneer Warehouse, 39 Whitehall
Street, Subtreasury,
Clearing
House,
1
1
Guaranty Trust (Forty-fourth Street), 91 Maiden Lane, 10 Gold Street.1
VAULTS IN NEW BUILDING.
Vault test.—Experiments conducted in Washington last year cost $75,000, borne
by all the Federal reserve banks.
Test demonstrating vault construction, lining, etc., obsolete.
Vault test to be conducted this fall at Sandy Hook on new aggregates will cost about
$25,000, to be borne by the Federal reserve banks of New York, Cleveland, Chicago,
St. Louis, Minneapolis, and Richmond, pro rata on the basis of total resources.
Cost of proposed vaults.—The vaults required, if constructed in accordance with the
plan of existing practice and methods, would cost $3,272,000. If constructed in accordance with our plan arrived at as a result of the vault test, the proposed vaults would
cost $1,500,000, which means that the tests proved that $1,700,000 could be saved in
vault construction.
This saving of $1,700,000 consists of two parts, namely: $1,250,000 on account of
eliminating linings, $450,000 by using foundation walls on three sides of the vault.
CAFETERIA.
Present facilities.—1. Provision now only for women. 2. Space occupied 1,493
square feet. 3. Cost of operation $53,210.54 for 6 months ending June 30, 1921, of
which $5,722.32 was paid by the bank, $48,138.22 was paid by employees. Total,
$53,210.54. 4. Average price per meal paid by employees, $0.32; average number of
persons served daily in June, 658.
1
At present being occupied.
EXPENSES OP FEDERAL RESERVE BANKS.
37
Proposed facilities of new building.—T^vo cafeterias would be provided, one for men
and one for women, each with an area of 8,000 square feet.
Service.—To be operated self-service plan. Proposed plan is to serve meals at cost.
Seating capacity 550 *or each.
RECREATION ROOM.
Proposed facilities for recreation—Reading room.—Two rooms set aside, one for men
and one for women. Area of each 2,200 square feet. These rooms are to be plainly
furnished.
GYMNASIUM.
The area set aside, 3,600 square feet for simple corrective exercises. No expensive
equipment.
ASSEMBLY ROOM.
Area set aside, 4,600 square feet to accommodate 1,000 people. Arranged for
educational purposes.
New York Chapter, Incorporated, American Institute of Banking (Section American Bankers Associa-
tion), 138 East Thirty-fifth Street.]
NEW YORK, July 14, 1921.
Mr. BENJAMIN STRONG, Governor,
Federal Reserve Bank, 120 Broadway, New York, N. Y.
DEAR MR. STRONG: I believe you will be interested to learn of the successful
records made by our student members from your bank in the educational courses
in the year just ended.
Mr. John J. Golden, a student in the second year, standard course, was awarded
the prize for the highest average in the course for the year.
Mr. D. E. Gillmore has satisfactorily completed the work of the preparatory course,
and thereby has qualified for entrance into the standard course.
The following were "Honor Students" in the courses mentioned: Robert S. Carnahan, elementary Spanish; John S. Creighton, credits; John J. Golden, money and
banking; Elizabeth Hicks, economic history; R. L. Smith, credits, reserves and
rediscounts; Russell Tweed, money and banking; Maude Voris, bank bookkeeping.
In addition, membes from the Federal reserve bank completed courses listed opposite their names as follows: Margaret S. Bleecker, principles of economics; Wilbur D. Browne, economic history; Henry M. Burnett, second year, standard course;
Marguerite Burnett, money and banking; Robert S. Carnahan, elementary Spanish;
Norman C. Cooper, first year, standard course; Robert J. Dickey, second year, standard course; John C. Dieckert, second year, standard course; Albert P. Fallon, first
year, standard course; Fred J. Fox, banking organization; John J. Golden, second
year, standard course; Phyllis Hall, bank bookkeeping; Clifford H. Hawkins, first
year, standard course; Elizabeth Hicks, banking practice, economic history; Rebecca Holmes, principles of economics; Alfred It. Kirkpatrick, first year, standard
course; Anna Reis, business English; Charles F. Rourke, second year, standard
course; George A. Shannon, economic history; Marion Schultes, bank accounting;
Russell Tweed, second year, standard course.
Very truly, yours,
WILLIAM FEICK,
President, New York Chapter, American Institute of Banking.
DATES OP ENGAGEMENT OF ARCHITECTS, ENGINEERS, AND CONTRACTORS.
1. Consulting architect: A. B. Trowbridge. Employed by the bank September
1, 1918. Employed by the Federal Reserve Board April 1, 1919. Salary, one-third
charged to Federal Reserve Board and two-thirds to bank.
2. Industrial engineer: H. A. Hopf. Employed, part time, August 1, 1918. Whole
time April 1, 1919. Appointed organization counsel September 1, 1919.
3. Architects competition: Specifications for competition issued July 23, 1919.
Drawings received October 9, 1919. Award made to York & Sawyer, November 5,
1919. Final contract with York & Sawyer, October 21, 1920.
4. Engineers (fees paid by architect): Vault engineer, Frederick Holmes employed
March 12, 1919, 3 per cent. Foundation engineer, Daniel C. Moran, employed De-
38
EXPENSES OF FEDERAL RESERVE BANKS.
cember 27, 1919, $25,000 plus 1 per cent on cost. Heating and electrical engineer,
Henry C. Meyer, employed December 27, 1919, 5 per cent. Equipment engineer,
Abell, Smalley & Meyers, employed December 31, 1919, 6 per cent.
5. General contractor: Marc Eidlitz. Informal arrangement December 22, 1919.
Formal contract executed January 25, 1921.
6. Preliminary examination for foundation work: Borings and test started by
Phillips & Worthington April 4, 1919. Informal negotiations with Foundation Co.
May 26, 1921. Contract with them July 1, 1921.
Statement of space occupied by bank.
Bank.
Year.
Square feet.
14,855
14,855
17,109
28,424
124,153
116,625
139,130
1914
1915
1916
1917
1918
1919
1920
Government
loan organization.-
Total.
Square feel.
Square feet.
31,749
94,450
86,060
54,352
60,173
218,603
202,685
193,482
Percentage of increase in volume of business, in the number of employees, and in expenses.
Volume of business.
Period.
Check collections
Noncash collections
Telegraphic transfers
Gold settlement fund transfers (including telegraphic)
Federal reserve notes paid out by bank
Federal reserve notes redeemed
Pieces of money counted (money division)
Money shipments
Discounts and advances
Open market purchases:
(a) For New York
(&) For other Federal reserve banks
Increase volume of business in those departments of the bank in which it is
possible to establish a unit of measurement for work done
Increase in number of employees in bank exclusive of fiscal agency departments..
Increase in expenses of bank
1915-1920
1915-1920
1916-1920
1915-1920
1915-1920
1916-1920
1916-1920
1916-1920
1915-1920
Per cent.
6,851
14,546
4,85S
8,676
1,760
407
3,868
2,462
7,881
1915-1920
1915-1920
5,560
2,122
1.
2.
3.
4.
5.
6.
7.
8.
9.
10.
Increase.
6,475
3,058
1,601
Number of employees in bank.
Employees.
Jan.
Jan.
Jan.
Jan.
Jan.
Jan.
1,1916
1,1917
1,1918
1,1919
1, 1920
1,1921
71
164
547
1,414
2,222
2,426
Officers.
7
9
16
27
32
37
Bank total.
78
173
563
1,441
2,254
2,463
Fiscal.
267
1,216
636
433
Grand
total.
78
173
830
2,657
2,890
2,896
Per cent.
Increase in number of bank employees
3,058
Increase in number of fiscal agency employees
62
NOTE BY FEDERAL RESERVE BOARD.—Figures given in the above table are based on the bank's records as of January 1 of each year and include the changes in the number of officers and employees
effective as of the first of the year, whereas figures given in the Federal Reserve Board's statement
repre ent the number of officers and employees as of Dec. 31 of each year before the above changes took
place.
39
EXPENSES OF FEDERAL RESERVE BANKS.
Growth of business in bank.
COLLECTION
SYSTEM.
Check collection.
Year.
Number of
items.
1915
1916
1917.
1918
1919
1920
. . .
Amount.
1,262,211
6,841,364
19,408,179
46,458,000
74,463,917
87,727,000
Amount of
coupon collection
$1,334,015,772
5,160,192,000
20,104,527,000
47,518,425,000
56,540,748,116
55,729,013,000
4,417
23.617
54; 153
229,548
309,362
646,942
$39,748,000
60,115,335
4,077
14,546
51
6,851 1
Increase for period (per cent)
Noncash collections, number of items.
TRANSFER OF FUNDS.
Telegraphic transfers.
Year.
Amount.
Number.
1915
1916
1917
1918
1919
1920
Increase for period (per cent)
1
Amount of gold
settlement,
including
telegraphic
transfers.
2,971
10,302
39,099
82,321
147,302
$484,500,000
6,768,400,000
19,384,371,849
18,245,250,181
17,021,509,374
1 $556,432,000
2,335,225,000
17,118,917,000
32,935,576.000
41,932,723; 000
48,840,900,000
4,858
3,413
8,676
1915 figures include period from May 20 to Dec. 31 only.
CURRENCY.
Federal reserve notes.
Amount issued
to bank by
agent.
Year.
1915
1916
1917.
1918
1919
1920
Increase for period (per cent)
Amount paid
out by bank.
Amount redeemed.
Number of
pieces of money
counted.
$89,440,000
71,273,000
415,000,000
589,400,000
753,120,000
373,080,000
$96,133,200
117,985,800
479,934,550
930,168,000
1,134,822,000
1,788,222,000
$54,509,235
65,665,200
26,722,730
632,419,880
276,441,725
14,070,188
53,051,334
206,902,600
477,476,000
558,397,400
317
1,760
407
3,868
COIN.
Year.
1920 (March to Dec. 31).
1921 (6 months)
Disbursements.
$24,753,632
Received.
$46,346,232
Counted and
wrapped.
$2,450,113
45,681,497
S H I P M E N T S ( C U R R E N C Y AND COIN).
Year:
1916
1917
1918
1919
1920
Increase during period (per cent)
Number.
. . . 2,631
34!937
63,194
67,405
2,462
40
EXPENSES OF FEDERAL RESERVE BANKS.
Growth oj business in bank—Continued.
REDISCOUNTS, INVESTMENTS, ETC.
Discounts and advances.
For other Federal
reserve banks.
For New York bank.
Year.
Number
of items.
1915
1916. .
1917
1918..
1919
1920
Open-market acceptances purchased.
. . ..
Amount.
Number
of items.
Number
of items.
Amount.
Amount.
2,261
2,505
22,484
129,038
127,721
180,462
$4,820,000
22,329,582
6,511,274,921
24,535,538,458
42,449,491,133
50,539,428,847
1,236
6,296
23,876
37,161
43,572
69,961
$25,838,632
123,406,550
464,965,601
945,497,424
1,211,000,000
1,697,000,000
1,632
8,667
10,895
8,142
28,584
36,276
$22,312,094
126,487,939
152,919,831
174,864,545
740,000,000
731,000,000
7,881
1,048,400
5,560
6,467
2,122
3,176
Increase during period (per
cent)
PRINCIPAL RESOURCE AND LIABILITY ITEMS AND DISTRIBUTION OF N E T INCOME.
1915
1916
1917
1918...
1919
1920
Total circulation Federal
reserve notes
and Federal
reserve bank
notes.
Total earning
assets.
Total
resources.
$270,121,914
302,410,497
649,944,656
672,528,785
595,355,279
618,170,690
$10,981,069
51,748,204
424,251,433
905,216,289
1,062,734,198
1,046,362,877
$211,328,388
393,862,040
1,208,924,654
1,871,806,077
1,915,864,187
1,814,170,174
$200,093,110
274,679,705
731,458,687
975,219,452
976,066,177
819,181,412
$73,300,000
93,426,000
397,354,000
762,858,000
862,288,970
906,313,830
129
9,430
758
309
1,136
Total
reserves.
Year.
Increase during period
(per cent)
Total
deposits.
Government
Total income. Total expense. franchise
tax.
Year.
1915
1916
1917
1918
1919
1920
$331.108
971,026
4,929,214
25,314,736
35,332,412
60,525,321
$411,510
556,962
1,655,507
2,680,703
5,734,345
6,999,255
18,179
1,601
Increase during period (per cent)
$649,364
2,703,894
39,318,511
Addition to
surplus.
$649,364
20,467,891
23,964,678
12,332,523
SECURITIES—PURCHASES AND SALES FOR ACCOUNT OF GOVERNMENT AND MEMBER
BANKS.
Yeaj:
1917
1918
1919
1920
$320,000,000
3,133,000,000
2,605,500,000
3,835,500,000
Increase during period (per cent)
1,098
TREASURER'S GENERAL ACCOUNT.
GOVERNMENT CHECKS AND WARRANTS PAID.
Year.
1916
1917.
1918
1919
1920
.
.
.
.
.
Number.
.
.
.
.
..
Amount.
1,356,265
3,029,189
11,107,981
12,967,138
10,712,243
$220,476,739
1,099,458,000
4,936,592,000
6,805,805,746
2,437,759,148
689
1,005
EXPENSES OF FEDERAL RESERVE BANKS.
41
Growth of business in bank—Continued.
TOTAL ANNUAL TURNOVER IN TREASURER'S GENERAL ACCOUNT.
Year:
1916
1917
1918
1919
1920
$518,313,000
23,790,869,000
52,570,509,000
38; 398,501,000
23,808,383,000
Total for period
139,086,575,000
Increase (per cent)
4,493
FISCAL AGENCY OPERATIONS.
GOVERNMENT BOND DEPARTMENT.
Number of
pieces handled.
Year.
1917
1918
1919
1920
1921 (6 months)
Total
Amount.
5,599,917
54,226,055
51,906,278
47,797,417
21,470,001
$4,374,285,000
9,522,954,000
7,873,914,000
6,955,101,000
4,168,044,000
180,999,668
32,894,298,000
CERTIFICATES OF INDEBTEDNESS DEPARTMENT—TOTAL TRANSACTIONS, INCLUDING ISSUES AND REDEMPTIONS.
Year:
1917
1918
1919
1920
1921 (6 months)
$4,371,387,000
7,993,048,000
9,975,306,000
4,897,941,000
1,922,592,000
:
Total
29,160,274,003
WAR LOAN DEPOSIT DEPARTMENT—DEPOSITS, WITHDRAWALS, COLLATERAL PLEDGED—RELEASED.
Year:
1917
$7,431,515,000
1918
17,486,634,000
1919
18,143,540,000
1920
6,332,248,000
1921 (6 months)
2,981,147,000
Total.
, 52,375,084,000
PARTIAL PAYMENT DEPARTMENT.
P a r value bonds sold
Number of accounts
Number of-separate p a y m e n t s (over)
$144,798,050
2,432,441
90,000,000
Number of
payments
received
(approximate).
Year.
1918
1919
1920
1921 (6 months)
..
Total.
Bonds
delivered
(pieces).
Bonds
redeemed
(pieces).
41,000,000
42,544,500
6,473,000
32,500
398,036
1,396,068
293,000
1,508
13,085
47,695
6,730
1,181
90,050,000
2,088,612
68,691
Certificates of indebtedness transactions.
Certificates of indebtedness and treasury notes
issued:
1917
$2, 422, 075, 500
1918
4,091,260,000
1919
4,506,155,500
1920
1,716,680,500
1921 (6 months)
865, 824, 200
$13, 601, 995, 700
42
EXPENSES OF FEDERAL RESERVE BANKS.
Certificates of indebtedness redeemed:
1917
1918
1919
1920
1921 (6 months)
$1,949,311,768
3,423,903,000
4,337,017,000
2,115,600,000
655, 042, 000
$12, 480, 873, 768
Purchases of Liberty bonds and Victory notes from
War Finance Corporation, account Treasury Department:
1918
477, 885, 000
1919
1,132,001,000
1920
279,236,000
Receipt of Liberty loan bonds and notes in payment
of estate and inheritance taxes:
1919
133,000
1920
2,955,950
1921 (6 months)
4, 954, 850
1, 889,122, 000
8, 043, 800
Miscellaneous purchases of Liberty loan bonds,
Victory notes, and certificates of indebtedness,
account Treasury Department:
1920
1921 (6 months)
183,469,050
396, 772, 050
580, 241,100
Miscellaneous safe-keepings on account of Treasury
Department:
1920
600, 000, 000
29,160, 276, 368
Government bond department transactions.
1. PAYMENTS RECEIVED.
1917
1918
$618,654,795.20
1,109,510,870.00
First Liberty loan
Second Liberty loan..
Third Liberty l o a n . . .
Fourth Liberty l o a n . .
Victory Liberty loan.
1,728,165,665.20
Total.
1919
$55,683,720.88
1,117,291,815.46
1,854,710,725.00
3,027,686,261.34
$193,845,591.02
1,321,140,846.95
1,514,986,437.97
Grand total, $6,270,838,364.51.
2. BONDS DELIVERED ON ALLOTMENT.
3£ per cent interim certificates.
Second Liberty loan.
Third Liberty loan.
Year.
1917
1918
Total
Pieces.
Amount.
1,621,516
1,621,516
Pice 33.
Amount.
Pieces.
$617,831,650
2,836,932
423,910
$1,027,226,750
137,140,200
4,220,777
$1,115,243,650
617,831,650
3,260,842
1,164,366,950
4,220,777
1,115,243,650
Fourth Liberty loan.
Vea,
1918
1919
1920
Total
Pieces.
Amount.
3,995,492
1,825,816
$1,400,172,950
545,7 8,800
5,821,308
2,044,901,750
Grand total, pieces, 18,189,862; amount, $6,260,385,150.
Amount.
Victory Liberty loan.
Pieces.
Amount.
3,259,364
6,055
$1,316,198 250
1,842,900
3,265,419
1,318,041,150
43
EXPENSES OE FEDERAL RESERVE BANKS.
Government bond department transactions—Continued.
3. T E M P O R A R Y — P E R M A N E N T
EXCHANGE.
Year.
Pieces.
1917
1918
1919
1920
1921 (6 months)
Total
Amount.
1,141,469
151,363
12,199
7,424 426
5., 792,930
$1,001,060,900
76,978,700
1,548 700
3,363 193 900
2,828,818^700
14,522,387
7,271,600,900
4. CONVERSIONS.
Year.
1918
1919
1920
1921 (6 months)
Total
Pieces.
Amount.
5,775,517
796,426
1,915,003
187,005
$2,474,839,700
727,628 400
726,059,000
154,669,600
8,673,951
4,083,196,700
5. E X C H A N G E O F D E N O M I N A T I O N S .
Year.
1918
1919
1920
1921 (6 months)
Total
Pieces.
Amount.
5,382,529
13,682,900
4,772,787
1,368,421
SI, 077,444,900
2 887,689 100
1,574,803,200
553,112,200
25,206,637
6,093,049,400
Pieces.
Amount.
6. U N I T E D S T A T E S COUPONS P A I D .
Year.
14,670,383
1918
1919
1920
1921 (6 months)
Total
27,834,731
31,301,783
13,134,971
$93,736 327 80
187,516 023 37
305,033,953.18
145,418,052.11
86,941,868
731,704,356.46
7. R E G I S T E R E D E X C H A N G E , COUPON E X C H A N G E A N D T R A N S F E R .
Year.
1919
1920
1921 (6 months)
Total
Pieces.
Amount.
617,625
803,332
330,746
1681,554,600
980,272 850
479,638,300
1,751,703
2,141,465,750
8. T H R I F T S E C U R I T I E S D E L I V E R E D .
Year.
1918
1919
1920
1921 (6 months)
. .
Total
Pieces.
Amount.
19,608,084
2,295,408
938,690
129,248
$20,711,254.75
4,625,634.50
1 542,682.75
270,421.25
22,969,430
27,149,993.25
44
EXPENSES OF FEDERAL RESERVE BANKS.
Government bond department transactions—Continued.
9. T H R I F T S E C U R I T I E S R E D E E M E D .
Year.
Amount.
Pieces.
1919
1920.
1921 (6 m o n t h s )
Total
287,745
164,332
419,144
$1,262,066.22
468,347.00
5,686,299.31
871,222
' 7,416,712. 53
10. T H R I F T C A R D S R E C E I V E D A N D D E S T R O Y E D .
Amount.
Pieces.
Year.
1919.
1920
1921 (6 m o n t h s ) . . .
Total
1,294, 063
471, 009
107, 536
$5,176,252.00
1,884,036.00
430,144.00
1,872, 608
7,490,432.00
Grand total for department, pieces, 180,999,668; amount, $32,894,298,000.
Purchases and sales of Liberty bonds, Victory notes, and other miscellaneous securities for
the year 1920 and six months ending June 30, 1921, for the account of other than the
Treasury Department.
Firm A.
1920
563,110
537,100
627,760
822,220
399,740
479,190
186,380
88,170
120,370
66,240
51,310
Jaituary
February
March
April
May
June
July
August
September
October
November
December
F i r m C.
Firm B.
1921
1920
991,550
927,000
1,248,450
2,056,900
1, Oil, 600
995,050
1921
1,077,250
1,481,900
834,950
2,227,950
1,271,250
3,155,760
Total..
2,151,000
1,374,500
18,000
80*666
1,142,600
918,635
1,551,550
2,110,604
1,017,000
2,723,700
""418," 350'
978,200
481,300
925,200
791,150
2,668,160
292,260
4,233,850
1920
10,049,030
7,230,550
Firm D.
Firm E.
9,885,860
9,464,089
All others.
Total.
1920
January
February
March
April
May
June
July
August
September
October
November
December
Total
1921
1920
1921
1920
187,500
167,500
1,234,000
1,953,630
1,298,150
1,201,800
972,650
1,053,250
1,517,000
1,067,550
1,465,800
2,447,000
2,249,400
5,580,490
530,000
554,000
7,000
15,000
798,700
382,000
200,000
5,000
355,000
22,040, 740
2,491,700
1921
877,010
914,285
585,860
434,474
550,940
788,950
321,730
138,920
067,470
438,440
091,860
540,910
65,750,849
Purchases and sales, 1920
$39,007,150
Purchases and sales, 6 months 1921
26,743,699
Total
65,750,849
These figures do not include purchases or sales of certificates of indebtedness or Treasury notes.
NOTE.—In addition to the above, the bank purchased upon orders of the United States Government during
1920 Liberty bonds and Victory notes aggregating $23,760,000 and for the first six months of 1921 $349,392,000.
45
EXPENSES OF FEDERAL RESERVE BANKS.
NEW YOG*
EMPLOYEES
5,000
M N FC% HAft API) nkV JUM -]VL AU6 i
ocr MOW oec. r*»i CBB M «
L * f OR >
VVOI
4,000
$3 87
{,&
£, 3T7 ,82 5
.-^
_1
$4,000,000
0
Vo
rl9 1 •t or
on
er
In
nj
1 oi l<
^/
(Di i l j A en «e 195 ) )
3,000
2,500
a;
g' 1 90"
0
$3,000,000
)8
- . . To U l En DIO fee
...
1
$2,500,000
$1,500
CSill
. A re r
a«e -Sa lar i e e
-$:
---
74 )5
$1,400 fri"
125
100
75
50 - 1 oni «
j
Aven
-^
loy
Ov t 6
flni loy see
-n-57
EBI
WCl ««•
M01
-R
y / ver
M01
1 ont hly
yet
B In
thl y ; ver age -E
tpl<
"id —t
ipl<
an
ipl^ ye< B I 1
ye« 8
C ut
7
45
25
$1,600
$1,500
$1,400
$1,300
$1,200
$1,100
Av »™ S?. Sal " 2 -En Bio Xfift ?
Av ara
Sal
-En
1
0
Ti
..A e r j
^l?
:erf
Mi ft.
Rfll
s0
&1* 83
Ml 78
ivooo
EXHIBIT D, PART 1.
FEDERAL RESERVE BANK OF BOSTON.
Comparison of salaries paid to officers of the Federal reserve bank as of Oct. 1, 1921, with
salaries paid to officers of three of the large national banks in Boston as of Sept. 6,1921.
Annual salary.
Governor
Chairman and Federal reserve agent
Deputy governor
Do
Cashier
Assistant Federal reserve agent
Secretary
Auditor
•
*.
$25. 000
18, 000
16. 000
12, 000
10, 000
6, 500
6, 000
6, 000
46
EXPENSES OF FEDERAL RESERVE BANKS.
Annual salary.
$6, 000
6, 000
6, 000
6, 000
6, 000
6, 000
Assistant cashier
Do
Do
Do
Do
Do
Total
135, 500
National banks in Boston.
Annual salary.
Position.
Bank A. Bank B. Bank C.
Chairman
President
Vice president
Do .
. .
Do
Do
Do
Do
Do
Do
Do
Do
Do
Do
Do
Other officers
Total
.
...
.
.
.
$25,000
50,000
- 25,000
25,000
25,000
20,000
15,000
15 000
13,000
$75,666
$40,000
17,500
9,500
85,000
42,000
32,000
30,000
27,500
25,000
20,000
18,000
18,000
12,500
12,000
12,000
9,000
9,000
69,200
298,000
411,200
101,750
34,750
SUMMARY.
Annual salaries.
Number
of officers.
Federal reserve bank
Bank A
.
Bank B
Bank C
Total.
14 $135,500
21 298,000
25 411,200
9 101,750
.
Average.
$9,679
14,190
16,448
11,306
Index of growth in number of officers and employees, in their aggregate salaries, and in
business of the bank.
[1915=1.]
Assets and
liabilities.
Personnel.
Year.
1915
1916
1917
1918
1919
1920
Volume of
business.
Officers and
employees.
Federal Discount
open- Gold setEarning reserve and
tlement
note cir- market
assets. culation.
operafund.
Number. Salaries. Number. Salaries.
tions.
Officers.
•
1
1
2
3
3
3
1
1
1
2
3
4
k
1
4
12
29
38
39
1
2
6
12
19
21
1
2
7
15
21
20
1
1
8
17
26
31
1
4
17
80
200
225
1
2
9
18
27
37
47
EXPENSES OF FEDERAL RESERVE BANKS.
Number of officers and employees.
Dec. 31—
Officers:
Chairman and Federal reserve agent
Governor
Deputv governor
Other officers.
1
1
1
1
1
1
2
3
4
5
4
3
3
2
1919
1920
5
1
1
2
8
1
1
2
9
1
1
2
10
7
11
12
13
14
13
12
25
3
55
17
30
4
160
29
126
15'
223
32
187
14
4
is
112
23
211
33
262
25
241
40
214
22
18
179
49
237
45
214
29
19
130
46
16
66
241
574
743
703
720
20
4
71
13
248
34
585
52
755
62
776
59
734
51
Employees:
Banking department
Bookkeeping department
Transit department
Federal reserve agent's department
Auditing department
Fiscal agency department
General
Total employees
1918
1917
1
1
1
8
Total officers
Total officers and emplovees
Average number of employees per officer
J u l y 1,
1921.
1916
1915
Salaries of officers and employees.
Dec. 31—
J u l y 1,
1921.
Officers:
Chairman and Federal reserve agent
Governor
Deputy governors
Other officers
Total (bonus excluded)... I
Employees:
Banking department
Bookkeeping department...
Transit department
Federal reserve agent's department
Auditing department
Fiscal agency department..
General
Total (bonus excluded)...
Total officers and emAverage salary payable to—
All officers...."
Officers other than chairman and Federal reserve
agent, governor, and
deputy governors
Employees
1
Two deputy governors.
1915
1916
1917
1918
$10,000
15,000
$10,000
20,000
$12,000
20,000
1919
1920
10,900
17,500
$12,000
20,000
11,000
32,975
40,900 |
49,500
75,975
102,500
120,500
135,500
15,260
11,360
24,460
57,700
16,530
24,961
134,283
27,343
75,635
265,200
33,240
188,240
299,600
50,000
248,240
3^0,980
63,300
277,040
46,180
34,200
227,100
64,500
57,000
29,820
184,880
65,660
238,872 | 533,103 j 879,900 j 989,820
1,008,680
50,880 ! 105,940 j 288,372 | 609,081 I 982,400 |1,090,320
1,144,180
8,500
33,500
6,100
3,100
2,100
3,680
3,580 I
"i6,~280"
17,380 !
65,040
$15,000
25,000
24,000
38,500
1
7,100
17,400
21,7S0
106,200
26,378
252,873
25,572
347,980
23,460
$18,000
25,000
1
27,000
50,500
$18,000
25,000
28,000
64,500
1
8,375
8,180
7,071
6,907
8,542
9,269
9,678
4,250
1,086
3,633
985
3,500
991
4,122
929
4,812
1,184
5,611
1,271
6,450
1,401
48
EXPENSES OF FEDERAL RESERVE BANKS.
Extra compensation paid by the Federal Reserve Bank of Boston for the years 1916-1921.
|Salaries shown are annual salaries. Per cent of extra compensation based on actual salary received during
period.]
Per cent.
40
30
20
July 1 to Dec. 31, 1919:
Jan. 1 to Dec. 31, 1916:
" Less than $1,000
To persons in the employ of
$1,000 to $1,999
the bank prior to July 1,
$2,000 to $4,999
1916, receiving an anm al
Jan. 1 to June 30, 1920:
salary of—
Less than $1,000
Less than $1,000
$50. CO
'
$1,000 to $1,999
$1,000 to $2.500
100.00
$2,000 to $4,999
To persons in the employ of
July 1 to Dec. 31, 1920:
the bank after July 1, 1916,
Less than $1,000
receiving an annual salary
$1,000 to $1,999
of—
$2,000 to $4,999
Less* than $1,000
25. 00
$1,000 to $2,500
50. 00 Jan. 1 to June 30, 1921:
Less than $1,000
Percent.
Jan. 1 to Dec. 31, 1917:
$1,000 to $1,999
10
Up to $5,000 ]
$2,000 to $4,999
Jan. 1 to Dec. 31, 1918:
Up to $5,000
10
Jan. 1 to June 30, 1919:
Less than $1,000...
20
15
$l,0CO to $1,999....
$2,000 to $4,999....
10
i Maximum bonus paid, $300.
20
15
10
40
30
20
10
Principal asset and liability items at end of year.
1915
1916
1917
1918
1919
1920
.
.
.
$28,760,000
40,458,000
85,814,000
110,851,000
155,786,000
217 516 000
.
Jndex of growth, 1915-1920 (1915= 1)
$6,493,000
12,725,000
9,037,000
15,084,000
18,649,000
20.678.000
$10,755,000
19,693,000
77,724,000
156,G13,000
229,032,000
216,109,000
738
3
20
8
.
Total earning assets.
$235,000
3,746,000
65,882,000
133,575,000
188,039,000
173.368.000
Capital and
surplus.
1915
1916
1917
1918
1919
1920
Bills
bought.
Bills
discounted.
Total cash
reserves.
Federal reserve notes in
circulation.
Gross
deposits.
$5,158,000
4,990,000
5,933,000
8,228,000
15,467,000
23,429,000
$28,352,000
68,810,000
102,933,000
160,153,000
191,454,000
161,828,000
$9,311,000
12,896,000
73,199,000
160,726,000
244,093,000
288,780,000
5
6
31
Index of growth, 1915-1920(1915-1)
Volume of business transacted during the year.
Bills discounted.
1915
1916
1917
1918
1919
1920
$14,105,000
52, 378,000
86, 482,000
194,158,000
360,784,000
304,445,000
$1,000,000
2,332,000
M,418,000
85,149,000
60,702,000
553,163,000
$25,452,000
96,254,000
438,946,000
2,039,592,000
5,096,884,000
5,734,164,000
2,337
22
553
225
Exclusive of certificates of indebtedness.
discount
United States Total
and opensecurities
market
bought.
operations.
$2,087,000
33, 922,000
350,919,000
1,760,285,000
4,675,398,000
4,876,556,000
Index of growth 1915-1920 (1915=1)
1
Bills bought.
49
EXPENSES OF FEDERAL RESERVE BANKS.
Volume of business transacted during the year—Continued.
Federal
reserve notes
issued
by agent.
1915
1916
1917
1918
1919
1920
Federal
reserve notes
redeemed
by agent.
Currency
paid out
to member
and other
banks.
2
2 $10,520,000
10,425,000
75,720,000
130,080,000
225,500,000
225,680,000
$500,000
6,926,000
11,942,000
38,390,000
139, 768,000
178, 844,000
21
358
I n d e x of g r o w t h 1915-1920 (1915=1)
Currency
received from
member
and other
banks.
$402,341,000
688,624,000
$505,853,000
698,979, 000
Number of
Amount of
checks cleared. checks cleared.
1915..
1916
13,482,000
18,783,000
36, 234,000
43, 821,000
1918
1919
1920
$6,951,311,000
12,778,762,000
13,054, 799,000
14,727,346,000
Transactions
through gold
settlement
fund.
s$440,259,000
1,022,016,000
4,118,966,000
7,941,426,000
12,102,189,000
16,203,081,000
I n d e x of g r o w t h 1915-1920 (1915= 1)
37
2 Nov. 16, 1914, to Dec. 31, 1915.
3
Represents daily average for the period May 20, 1915 (date of first settlement) to Dec. 31, 1915, multiplied by 365.
Expenses of the Federal Reserve Bank of Boston.
Nov. 16
t o Dec.
31, 1914.
Expenses of operation:
SalariesBank officers
$3,217
Clerical staff
3,136
Special officers and
watchmen
All other
Federal advisory council,
governors' and Federal reserve agents' conferences.
59
Directors' meetings, legal
fees, officers' and clerks'
traveling expenses, life
insurance and fidelity
bond premiums
2,987
Assessments for Federal
Reserve Board expenses..
Taxes and fire insurance
81
Telephone and telegraph
583
Rent, light, heat and power.
2,499
Printing and stationery
All other, including postage
and insurance on mail,
security and currency
shipments, repairs and
214,147
alterations, etc.
Total expenses of op26,709
eration
Federal reserve currency (original cost, including shipping
charges)
Miscellaneous charges, account
note issues
Taxes on Federal reserve bank
note circulation...
Furniture and equipment
'- Total expenses
26, 709
1
1915
1916
1917
1918
1919
$32,050
18,641
$33,916
43,169
$43, 550
100, 893
$75,975
264,942
$105,097
606,345
$116,600
781,904
604
9,115
12,278
12, 111
20,988
7,207
992
744
853
1,123
322
1,177
1,648
12,680
11,631
12,643
24,144
38,980
45,785
i 26, 876
17,704
1,142
14, 371
2,788
1,678
16,629
8,480
21,226
495
5,131
25, 523
13, 354
32,190
25,035
10, 729
38, 444
39, 348
45,619
3,554
19,813
75,138
41,478
52,584
1,180
22,606
78,287
63,667
9,652
22,430
65,252
170,446
259,698
253,788
119,699
157, 285
289,663
691,112 1,220,964
1,445,719
11,902
15,141
102,621
167, 828
285,917
345,151
7,558
31, 774
112,162
89,422
43, 748
82,000
24,585
28,673
970,015 1,671, 825
2,038,290
675
1,752
21, 852
14,974
133, 353
194,953
407, 258
Total assessment for Federal Reserve Board expenses to Dec. 31,1915.
2 Includes $12,999 expenses prior to Nov. 16, 1914.
S. Doc. 75, 67-1
4
1920
41,622
61, 895
50
EXPENSES OF FEDERAL RESERVE BANKS.
EXHIBIT D, PART 2.
FEDERAL RESERVE BANK OF NEW YORK.
Comparison of salaries paid to officers of the Federal reserve bank as of Oct. 1} 1921,
with salaries paid to officers of six of the large national banks in New York City as oj
Sept. 6, 1921.
Annual salary.
Governor
$50,000
Chairman a n d Federal reserve agent
30,000
D e p u t y governor
30,000
Do
30,000
Do.....
25,000
Do
22,000
Acting general auditor
20,000
Organization counsel
18, 000
Controller at large
18,000
Do
15,000
Assistant Federal reserve agent
15,000
General counsel
15,000
Controller of administration
12, 500
Controller of accounts
12, 500
Controller of cash and custodies
12, 000
Manager credit d e p a r t m e n t
12, 000
Controller of fiscal agency
10,000
Manager loan d e p a r t m e n t
10,000
Manager at large
10, 000
Manager certificates of indebtedness and securities departments
10,000
Manager statistics department
10, 000
Manager bill department
8,400
Manager personnel development d e p a r t m e n t
8,000
Secretary
7, 500
Manager foreign d e p a r t m e n t
7, 500
Manager personnel service d e p a r t m e n t
7, 200
Manager check d e p a r t m e n t
7, 200
Manager cash d e p a r t m e n t
7,000
Manager b a n k examinations d e p a r t m e n t
6, 600
Assistant general counsel
6, 500
Manager auditing d e p a r t m e n t
6, 500
Manager methods and supplies d e p a r t m e n t
6,000
Manager collection department.
6,000
Manager Government securities sales d e p a r t m e n t
6,000
Manager custody d e p a r t m e n t
•.
6> 000
Manager Government bond d e p a r t m e n t
5, 500
Manager discount d e p a r t m e n t
5,000
Manager Buffalo branch
7, 500
Cashier Buffalo branch
4, 800
Assistant cashier Buffalo branch
3, TOO
Total
509,800
51
EXPENSES OF FEDERAL RESERVE BANKS.
National banks in New York City.
Annual salary.
Position.
Bank A.
Chairman of board
Vice chairman of board
Do
Do
President
Vice president
Do.
Do
Do
Do.
Do
Do
Do.
Do
Do
Do.
Do
Do. . . .
Do
Do
Do.
Do
Do
Do.
Do
Do
Do.
Do
Do. . . .
Do
Do
Do.
Do
Other officers
.
. . .
.
.
:
Total
$65,000
20,000
32,000
40,000
40,000
30,000
24,000
20,000
20,000
20,000
20,000
18,000
15,000
15,000
15,000
15,000
13,000
12,000
12,000
12,000
10,000
10,000
10,000
10,000
10,000
10,000
10,000
10,000
10,000
9 000
8,500
8,000
5,500
189,200
BankB.
Bank C.
BankD.
BankE.
Bank F.
$75 000
$75,000
75,000
50,000
50, 000
50,000
50,000
45,000
40,000
35,000
35,000
35,000
35,000
35, 000
35,000
30,000
30, 000
30,000
25,000
25,000
25,000
25, 000
25,000
12,500
$100, 000
54, 500
38,000
38,000
23,000
702,000
132,700
59, 880
51, 500
121, 500
768,200 1, 574, 500
386,200
318, 880
345, 500
627,500
$100, 000
75, 000
23, 000
21, 000
20,000
20, 000
75, 000
36, 000
36, 000
36,000
36,000
$75,000
45,000
40, 000
40,000
40,000
40,000
30,000
25,000
25,000
25,000
20,000
15,000
15,000
15,000
12,000
12,000
11,000
11,000
10,000
SUMMARY.
Number
of
officers.
Federal reserve bank.
Bank A
Bank B
BankC
Bank D
BankE
Bank F
."
. .
40
67
82
23
12
12
36
Annual salaries.
Total.
$509,800
768, 200
1,574, 500
386, 200
318,880
345,500
627, 500
Average.
$12,745
11,466
19,201
16,791
26,573
28,792
17,431
52
EXPENSES OF FEDERAL RESERVE BANKS.
Index of growth in number of officers and employees, in their aggregate salaries, and in
business of the bank.
[1915=1.]
Assets and liabil- Volume of business.
ities.
Personnel.
Officers and employees.
Federal
reserve
notes Discount
and
and
Earning Federal
openassets. reserve market
operabank
Number. Salaries. Number. Salaries.
tions.
notes
m circulation.
Officers.
Year
1
1
2
3
5
5
1915
1916
1917
1918
1919
1920
1
1
2
3
4
5
1
2
11
36
40
40
1
2
6
19
24
29
1
1
5
39
82
97
95
Gold -
settlement
fund.
1
3
122
534
819
989
1
5
10
12
12
1
4
31
59
75
88
Number of officers and employees
Dec 31—
1915
Officers:
Chairman and Federal reserve agent
G overnor
Deputy governor
Other officers
Average number of employees per officer
...
'
1917
1918
1923
1919
5
l
l
l
6
1
1
2
8
1
1
4
17
1
1
2
28
1
1
4
31
1
1
4
34
7
9
12
23
32
37
40
47
5
9
88
10
57
287
15
168
6
892
42
446
8
1,297
79
614
30
6
9
299
42
1,219
27
741
170
1,075
126
522
74
109
461
532
1,113
173
613
106
115
343
584
1
1
Total officers
Employees:
Banking department
Bookkeeping department
Transit department
Federal reserve agent's department
Auditing department
Fiscal agency department
G eneral.
Total employees
Total officers and employees
July 1,
1921.
1916
67
164
817
2,634
2,931
2,899
3,047
74
173
829
2,657
2,963
2,936
3,087
10
18
68
115
92
78
76
Salaries of officert and employees.
Dec. 31—
Julv 1,
1921.
1915
1916
1917
1918
1919
1920
Chairman and Federal reserve agent . .
. . .
Governor
Deputy governor
Other officers
$16,000
30,000
37,000
$16,000
15,000
120,000
42,000
$20,000
30,000
2 45,000
56,200
$20,000
30,000
3 81,000
89,400
$30,000
50,000
* 51,000
219,200
$30,000
5 25,000
3 95,000
268,400
$30,000
50,000
3 107,000
317,600
Total (bonus excluded)...
83,000
93,000
151,200
220,400
350,200
418,400
504,600
Officers:
1
Governor ad interim.
s8 Governor ad interim and one deputy governor.
Four deputy governors.
<
Two deputy governors.
6
Half pay account leave of absence.
53
EXPENSES OF FEDERAL RESERVE BANKS.
Salaries of officers and employees—Continued.
Dec. 31—
Employees:
Banking department
Bookkeeping d e p a r t m e n t . . .
Transit department
Federal reserve agent's department
Auditing department
Fiscal agency d e p a r t m e n t . .
General
1915
1916
60,588
4,620
6,430
97,552
10,700
36,480
1917
301,648
15,360
94,480
9,520
July 1,
1921.
1918
1919
1920
945,360 1,608,220 1,609,610
47,680
101,766
202,320
338,430
580,700
590,700
17,860
54,804
360,932 1,501,840
37,440
33,260
989,656
200,118
1,660,590
282,420
714,040
145,120
210,650
723,680
738,793
201,800
225,540
557,560
842,153
5,540
8,460
Total (bonus excluded)...
77,178
153,192
819,380 2,884,430 3,535,264 4,220,873
4,484,103
Total, officers and employees
160,178
246,192
970,580 3,104,830 3,885,464 4,639,273
4,988,703
11,857
10,333
12,600
9,582
10,944
11,308
12,615
7,400
1,152
7,000
7,025
1,003
5,259
1,095
7,830
1,206
8,658
1,456
9,341
1,471
Average salary payable t o All officers
Officers other t h a n chairm a n and Federal reserve
agent,
governor,
and
deputy governors
Employees
Extra compensation paid by the Federal Reserve Bank of New York for the years
1916-1921.
[Salaries shown are annual salaries.
Per cent of extra compensation based on actual salary received during
period.]
Per cent.
Jan. 1 to Dec. 31, 1916:
Up to $1,200
$1,201 to $3,000
$3,001 to $12,000
Jan. 1 to June 30, 1917:
Up to $1,200
$1,201 to $3,000
$3,001 to $7,200
July 1 to Dec. 31, 1917:
Less than $1,500
$1,500 to $5,000
Jan. 1 to June 30, 1918:
Less than $1,500
$1,500 to $5,000
July 1 to Dec. 31, 1918:
Up to $1,500
$1,501 to $3,000
$3,001 to $5,000
Jan. 1 to June 30, 1919:
Up to $1,500
$1,501 to $3,000
$3,001 to $5,000
July 1 to Sept. 30, 1919:
Upto$l,500
$1,501 to $3,000
$3,001 to $5,000
1
10
7J
5
20
15
10
15
10
15
10
25
20
15
25
20
15
25
20
15
Extra compensation applies only to salaries or portions of salaries up to $2,500.
Per cent.
Oct. 1 to Dec. 31, 1919:
Up to $1,500
$1,501 to $3,000
$3,001 to $6,000
Jan. 1 to Dec. 31, 1920: 1
On first $1,500 or part thereof.
On next $500 or part thereof..
On next $500 or part thereof..
No additional per cent on
amounts between $2,501 and
$5,000.
Jan. 1 to Mar. 31, 1921: *
On first $1,500 or part thereof..
On next $500 or part thereof..
On next $500 or part thereof..
No additional per cent on
amounts between $2,501 and
$5,000.
Apr. 1 to June 30, 1921: 1
On the first $1,500 or part
thereof
On the next $500 or part
thereof
On the next $500 or part
thereof
No additional per cent on
amounts between $2,501 and
$5,000.
50
40
25
20
15
10
20
15
10
10
1\
5
54
EXPENSES OF FEDERAL RESERVE BANKS.
Principal asset and liability items at end of year.
1915
1916
1917
1918
1919
1920
..
Total cash
reserves.
Bills discounted.
$270,122,000
302,410,000
649,945,000
672,528,000
595,355,000
618,171,000
$238,000
7,071,000
250,309,000
697,342,000
790,803,000
871,439,000
$8,715,000
41,457,000
. 148,770,000
77,577,000
202,903,000
113,740,000
$10,981,000
51,748,000
424,251,000
905,216,000
1,062,734,000
1,046,363,000
2
3,662
13
95
Index of growth, 1915-1920 (1915= 1)
Bills bought.
Capital and
surplus.
1915
1916
1917
1918
1919
1920
:
Gross deposits.
Total earning
assets.
Total circulation, Federal
reserve notes
and Federal
reserve b a n k
notes.
$11,063,000
11,866,000
19,345,000
29,142,000
67,473,000
82,787,000
$200,093,000
274,680,000
731,459,000
975,219,000
976,066,000
819,181,000
$73,306,000
93,426,000
397,354,000
762,858,000
862,289,000
906,314,000
7
4
12
Index of growth, 1915 1920(1915-1)
Volume of business transacted during the year.
1915
1916
1917
1918
1919
1920
.
Index of growth, 19151920(1915=1)
Bills discounted.
Bills bought.
$4,820,000
22,330,000
6,511,275,000
24,535,538,000
42,449,491,000
50,539,429,000
$25,839,000
123,406,000
464,965,000
945,497,000
1,211,399,000
1,697,330,000
10,485
66
discount Federal reserve
United States Total
and opensecurities
paid out
market opera- notes
bought.
by bank.
tions.
$7,819,000
10,884,000
5,028,024,000
3,132,983,000
4,281,561,000
1
$57,119,000
191,986,000
6,973,790,000
30,509,110,000
46,793,873,000
56,518,320,000
$96,133,000
117,986,000
479,935,000
930,168,000
1,134,822,000
1,788,222,000
989
19
Transactions
Federal reserve Money counted, Number of
Amount of
through goldnotes redeemed number of checks
cleared. checks cleared. settlement
pieces.
by bank.
fund.
1915
1916
1917
1918
1919
1920
.
.
$54,509,000
65,665,000
26,723,000
632,420,000
276,442,000
14,070,000
53,051,000
206,903,000
477,476,000
' 558,397,000
Index of growth, 19151920(1915=1)
1
Exclusive of certificates of indebtedness,
a May 20,1915, to Dec. 31,1915.
2
1,262,000
6,841,000
19,408,000
46,458,000
74,464,000
87,727,000
$1,334,016,000
5,160,192,000
20 104,527 000
47,518,425,000
56,540,748,000
55,729,013,000
$556,432,000
2,335,225,000
17,118,917,000
32,935,576,000
41,932,723,000
48,840,900,000
70
42
88
55
EXPENSES OF FEDERAL RESERVE BANKS.
Expenses of the Federal Reserve Bank of New York.
Nov. 16
to Dec. 31,
1914.
Expenses of operation:
SalariesBank officers
Clerical staff
Special officers and
watchmen
All other
Federal advisory council,
governors' and Federal
reserve agents' conferences
Directors' meetings, legal
fees, officers' and clerks'
traveling expenses, life insurance, and fidelity bond
premiums
Assessments for Federal
Reserve Board expenses..
Taxes and fire insurance—
Telephone and telegraph...
Rent, light, heat, and power.
Printing and stationery
All other, including postage
and insurance on mail,
security and currency
shipments, repairs and
alterations, etc
Total expenses of operation
Federal reserve currency (original cost, including shipping
charges)
Miscellaneous charges, account
note issues
Taxes on Federal reserve bank
note circulation
Furniture and equipment
Bank premises
Total expenses..
1917
$68,033
66,708
$10,367
3,636
90
$92,650
103,699
7,248
11,737
2,707
2,306
2
1918
1919
$129,247 $189,901 $302,030
287,356 1,082,719 2,555,388
1920
$383,760
3,479,270
11,017
29,534
25,854
82,110
180,579
166,449
199,213
1,312
1,791
1,605
1,558
17,272
9,999
23,494
61,234
166,812
110,821
163,209
39,029
50,252
181,875
91
6,500
686
2,024
39,497
10,782
2,751
45,810
20,067
10,082
62,141
46,009
100,876
2,423
33,054
146,005
137,960
65,725
293,102
236,653
221,868
3,328
81,979
304,874
270,383
33,736
24,618
40,391
201,040
364,988
547,341
558,701
57,412
297,710
378,077
851,484 2,146,805 4,613,220
5,782,204
113,800
95,240
789,013
335,044
642,430
648,392
12,938
15,010
27,921
105,167
159,767 *
170,933
169,514
204,014
207,401
201,491
556,962 1,655,507 2,680,703 5,734,345
6,999,255
70,707
57,412
411,510
* Total assessment for Federal Reserve Board expenses to Dec. 31, 1915.
Includes $32,408 expenses prior to Nov. 16, 1914.
2
Current expenses of the Buffalo branch of the Federal Reserve Bank of New York.
Salaries:
Bank officers
Clerical staff
Special officers and watchmen
All other
Directors' meetings, legal fees, officers' and clerks' traveling expenses, life insurance
and fidelity bond premiums
.•.
Taxes and fire insurance
Telephone and telegraph
Rent, light, heat, and power
•
Printing and stationery
Furniture and equipment
All other, including postage and insurance on mail, security and currency shipments,
repairs and alterations, etc
Total current expenses.
* Branch opened for business May 15,1919.
19191
1920
$8,600
68,213
5,418
4,085
$17^ 544!
123,028
11,334
14,275
12,741
3,937
418
11,006
18,024
13,277
19,486
4,186
10,457
8,399
33,518
52,615
42,102
208,232
274,431
56
EXPENSES OF FEDERAL RESERVE BANKS.
EXHIBIT D, PART 3.
FEDERAL RESERVE BANK OF PHILADELPHIA.
Comparison of salaries paid to officers of the Federal Reserve Bank as of Oct. 1, 1921,
wiOi salaries paid to officers of three of the large national banks in Philadelphia as of
Sept. 6, 1921.
Annual salary.
Governor
$25, 000
Deputy governor
15, 000
Chairman and Federal reserve agent
15, 000
Cashier and secretary
12,000
Assistant Federal reserve agent
'.
8, 000
Assistant cashier
8, 000
Do
8,000
Do
7,000
Do
6, 500
Do
6, 500
Do
6, 500
Acting comptroller,
4, 000
Total
121. 500
National banks in Philadelphia.
Annual salary.
Position.
Bank A. BankB. Bank C.
Chairman . .
President
Vice president
Do
Do .
Do
Do . .
Other officers
,
$80,000
40,000
25,000
20,000
15,000
15,000
56,500
Total
251,500
$6,000
36,000
20,000
12,500
12,000
$12,000
45,000
25,000
13,500
18,000
20,500
104,500
116,000
SUMMARY.
Number
of officers.
Annual salaries.
Total.
12. $121,500
15 251,500
8 104,500
7 116,000
Federal reserve bank.
Bank A
BankB
BankC
Average.
$10,125
16,767
13,063
16,571
Index of growth in number of officers and employees, in their aggregate salaries, and in
business of the bank.
(1915=1 )
Assets and
liabilities.
Personnel.
Date.
1915
1916
1917
1918
1919
1920...
Volume of
business.
Officers and
employees.
Federal Discount
open Gold setEarning reserve and
tlement
assets. note cir- market
operafund.
culation.
Number. Salaries. Number. Salaries.
tions.
Officers.
1
1
2
3
4
3
1
1
1
2
3
3
1
2
4
9
14
19
1
1
3
6
11
15
1
3
10
31
40
35
1
2
11
26
27
32
1
4
14
90
4S9
281
1
3
14
23
32
38
57
EXPENSES OF FEDERAL RESERVE BANKS.
Number of officers and employees.
Dec. 31—
1915
Officers:
Chairman and Federal reserve agent
G overnor
.
.
Deputy governor
Other officers
Total employees
Total officers and employees
Average number of employees per officer
1917
1
1
1
1
1918
1919
1920
July 1,
1921.
1
2
1
1
1
3
3
4
6
9
11
10
11
8
4
6
5
12
10
35
5
38
17
74
6
143
36
98
6
134
26
186
11
19
23
26
25
98
33
63
216
126
25
211
22
26
105
316
236
27
252
40
27
94
264
42
85
186
414
636
831
940
45
14
89
21
192
31
423
46
647
58
841
83
951
85
Total officers
Employees:
Banking department
Bookkeeping department
Transit department
Federal reserve agents' department
Auditing department
Fiscal agency department
General...
1916
1
1
1
6
1
1
1
8
1
1
1
7
1
1
1
8
Salaries of officers and employees.
Dec. 31—
Officers:
Chairman and Federal reserve agent
Governor.
Deputy governor.
Other officers
Total (bonus excluded)...
Employees:
Banking department.Bookkeeping department...
Transit department
Federal reserve agents' department
Auditing department
Fiscal agency department..
General
Total (bonus excluded)...
Total officers and employees
Average salary payable to—
All officers
Officers other than chairman and Federal reserve
agent, governor, and
deputy governors
Employees
July 1,
1921.
1915
1916
1917
1918
$10,000
20,000
$10,000
20,000
$10,000
20,000
9,000
28,000
$15,000
25,000
12,000
39,500
$15,000
25,000
15,000
57,000
$15,000
25,000
15,000
62,500
5,000
10,200
$10,000
20,000
12,000
9,250
35,000
40,200
51,250
67,000
91,500
112,000
117,500
14,400
3,300
5,880
15,940
9,360
24,180
34,084
18,080
47,790
137,740
47,540
79,560
173,060
29,700
176,904
176,420
34,520
244,240
319,610
38,920
286,220
5,976
7,140
8,060
7,880
27,130
102,240
32,080
76,640
237,440
47,900
48,190
132,950
361,868
85,418
52,440
118,530
289,190
407,040
720,874 1,046,088 1,190,328
812,374 1,158,088 1,307,828
12,480
14,672
42,036
71,292
23,160
16,848
148,022
77,036
111, 492
199,272
474,040
11,666
10,050
8,541
7,444
8,318
11,200
10,682
5,000
1,000
5,100
838
3,083
796
4,667
4,938
1,133
8,142
1,258
7,812
1,266
58
EXPENSES OF FEDERAL RESERVE BANKS.
Extra compensation paid by the Federal Reserve Bank of Philadelphia for the years
1917-1921.
[Salaries shown are annual salaries. Per cent of extra compensation based on actual salary received during
period.]
Per cent.
Per cent. Jan. 1 to June 30, 1920:
Jan. 1 to Dec. 31, 1917:
20
Up to $1,500
$3,500 or less
10
15
$1,501 to $3,000.....
Jan. 1 to June 30, 1918:
20
$3,001 to $4,000....
10
Up to $4,500
July 1 to Dec. 31, 1920:
July 1 to Dec. 31, 1918:
20
Up to $1,500
20
Up to $5,000
15
$1,501 to $3,000....
Jan. 1 to June 30, 1919:
10
20
$3,001 to $4,000....
Up to $1,500
15 Jan. 1 to June 30, 1921:
$1,501 to $2,500
10
10
Up to $1,500
$2,501 to $4,000
$1,501 to $3,000....
July 1 to Dec. 31, 1919:
30
$3,001 to $4,000....
Up to $1,500
20
$1,501 to $3,000
10
$3,001 to $4,000
Principal asset and liability items at end of year.
Total cash
reserves.
$172,000
$27,392,000
1,563,000
41,367,000
121,476,000 35,912,000
134,022,000 178,820,000
141,364,000 209,855,000
205,390,000 172,383,000
1915
1916
1917
1918
1919
1920
1915
1916 . .
1917
1918
1919
1920
.
$2,543,000
$6,226,000
13,656,000
18,509,000
18,390,000
63,962,000
3,011,000 193,249,000
5,177,000 '247,104,000
12,689,000 216,967,000
5
35
Capital
and
surplus.
Gross
deposits.
Federal
reserve
notes in
circulation.
$5,270,000
5,228,000
6,142,0008,866,000
16,689,000
25,495,000
$26,371,000
66,202,000
121,855,000
171,500,000
200,721,000
165,007,000
$8,759,000
16,906,000
92,977,000
229,112,000
237,051,000
278,321,000
6
32
1,002
7
I n d e x of growth 1915-1920 (1915=1)
Total earning assets.
Bills
bought.
Bills discounted.
I n d e x of growth 1915-1920 (1915— 1)
5
Volume of business transacted during the year.
Bills
discounted.
1915
1916
1917
1918
1919
1920
Index of growth 1915-1920 (1915=1)
Bills bought.
$5,137,000
22,328,000
223,416,000
1,833,598,000
10,736,435,000
5,820,258,000
$7,565,000
53,122,000
70,710,000
77,687,000
14,048,000
41,232,000
1,133
5
United States Total discount
securities
and open-marbought.
ket operations.
$2,000,000
2,500,000
12,274,000
67,172, 000
52,922,000
357,432,000
$22,102,000
85.772,000
308,022,000
1,978,467,000
10,803,405,000
6,218,922,000
179
281
1
59
EXPENSES OF FEDERAL RESERVE BANKS.
Volume of business transacted during the
year—Continued.
Currency
paid out to
member and
other banks.
Currency
Federal reserve Federal reserve received
notes issued notes redeemed member from
and
by agent.
by agent.
other banks.
2
1915
1916
1917
1918
1919
1920
2
$9,800,000
14,158,000
93,600,000
191,460,000
195,660,000
177,420,000
$640,000
6,248,000
13,344,000
46,915,000
189,635,000
134,017,000
18
209
Index-of growth 1915-1920 (1915=1)
$389,239,000
643,235,000
$444,475,000
570,094,000
Number of
Amount ol
checks cleared. checks cleared.
1915
1916.. . .
1917
1918
1919
1920
...
11,728,000
17,134,000
37,004,000
49,217,000
.-
$7,3S3,090,000
11,292,410,000
14,766,937,000
16,855,904,000
Transactions
through gold
settlement
fund.
'$472,389,000
1,580,311,000
6,676,287,000
10,885,905,000
15,267,158,000
17,880,707,000
Index of growth 1915-1920 (1915—1)
38
1 Exclusive of certificates of indebtedness.
2 Nov. 16, 1914, to Dec. 31, 1915.
s
Represents daily average for the period May 20, 1915 (date of first settlement), to Dec. 31, 1915, multiplied by 365.
Expenses of the Federal Reserve Bank of Philadelphia.
Nov. 16
to Dec. 31,
1915
1916
1917
1918
1919
$32,580
31,309
$39,100
52,398
$46,206
97,749
$64,288
283,624
$95,929
577,104
$123,338
799,385
5,384
6,012
8,311
14,976
44,688
59,228
70,921
80,412
1,473
1,335
524
512
591
714
26,582
59,197
03,588
49,059
15,775
22,001
56,804
20,033
26,057
1914.
Expenses of operation:
Salaries$3,461
Bank officers
2,777
Clerical staff
Special officers and
667
watchmen
All other .
. .
Federal advisory council,
governors' and Federal
31
reserve agents' conferences
Directors' meetings, legal
fees, officers' and clerks'
traveling expenses, life
insurance and
fideity
bond premiums
1,160
Assessments for Federal Reserve Board expenses
Taxes and fire insurance
70
Telephone and telegraph
Rent, light, heat, and
1,294
power.
Printing and stationery
730
All other, including postage
and insurance on mail,
security and currency
shipments, repairs and
alterations, etc
;, 213,871
Total expenses of op24,061
eration
Federal reserve currency (original cost, including shipping
10,342
10,908
14,198
i 28,919
18,362
33,929
22,057
48
3,128 """9*949"
1,022
1,243
8,858
3,291
10,397
6,648
12,361
11,091
9,851
34,366
19,116
78,477
40,671
113,644
6,153
18,580
45,165
115,387
238,078
224,570
129,331
164,983
260,838
593,464
1,260,243
1,620,167
12,600
16,600
70,340
243,857
209,419
292,540
1,003
1,887
3,081
45,411
77,508
98,132
100,868
61,112
110,904
75,065
90
Miscellaneous charges, account
Taxes on Federal reserve banknote circulation
Furniture and equipment
Bank premises
Total expenses
1
15,653
24,061
141,931
198,239
8,600
215,043
31,471
341,605 1,086,916 1,775,185
Total assessment for Federal Reserve Board expenses to Dec. 31, 1915.
-Includes $13,305 expenses prior to Nov. 16, 1914.
1920
2,176,274
60
EXPENSES OF FEDERAL RESERVE BANKS.
EXHIBIT D, PART 4.
FEDERAL RESERVE BANK OF CLEVELAND.
Comparison of salaries paid to officers of the Federal reserve bank as of Oct. 1, 1921, with
salaries paid to officers of three of the large member banks in Cleveland.
Annual salary.
Governor
Chairman ard Federal reserve agent
Deputy governor
Do
Cashier
Secretary
Assistant cashier
Do
Do
Do
Auditor
Chief bank examiner
Manager bank relations
Assistant cashier
Do
Assistant secretary
Manager Pittsburgh branch
Cashier Fittsburgh branch
Assistant Federal reserve agent, Pittsburgh branch
Assistant cashier, Pittsburgh branch
Do
Manager Cincinnati branch
Cashier Cincinnati branch
Assistant Federal reserve agent, Cincinnati branch
Assistant cashier, Cincinnati branch
Do
,
Total
$30, 000
25, 000
12, 000
12, 000
9, 000
9, 000
6, 500
6, 500
6,000
5,400
5, 400
5, 000
4, 800
4, 500
4,200
3, 900
11, 000
7, 500
4, 300
4, 200
3,300
8, 500
5, 000
3, 300
3, 300
3,000
202, 600
Member banks in Cleveland.
Annual salary.
Position.
Bank A. Bank B. Bank C.
Chairman
President
Vice president .
Do
Do
Do..
Do
Do
...
Do
Do
Do
Do
Do
Do
Do
.
Do
Do
Do."
Do
Do
...
Other officers
Total
.
.
.
.
.
. . .
.
. .
«
$35,000
35,000
35,0(30
30,000
30,0(30
30,0(30
25,0(30
25,0(30
24,000
24,0(30
24,0(30
24,0(30
22,0(30
22,0(30
22,0(30
20,0(30
20,000
20,000
20,000
20,0(30
200,0(30
$20,000
50,000
36,000
25,000
24,000
15,000
15,000
15,000
12,000
12,000
12,000
12,000
10,000
10,000
9,000
7,000
6,000
5,000
97,600
33,000
707, 0(30
392,600
148,000
$25,000
18,000
16,000
14,000
12,000
12,000
12,000
6,000
61
EXPENSES OF FEDERAL RESERVE BANKS.
Member banks in
Cleveland—Continued.
SUMMARY.
A n n u a l salaries.
Number
of officers.
Federal reserve bank
Bank A
.
Bank B
BankC.
26
70
40
14
..
Total.
Average.
$202,600
707,000
392,600
148,000
$7,792
10,100
9, 815
10,571
Index of growth in number of officers and employees, in their aggregate salaries, and in
business of the bank.
[1915=1.]
Assets and liabilities.
Personnel.
Year.
Officers a n d employees.
Officers.
Number.
Salaries. Number. Salaries.
1
2
7
19
20
31
1
1
2
2
3
4
1
1
2
3
4
5
1915
1916
1917
1918
1919
1920
Earning
assets.
Discount
Federal and
open Gold setreserve market
tlement
note cir- operafund.
culation. tions.
1
1
10
24
25
33
1
3
16
27
36
39
1
1
4
11
12
21
Volume of business.
1
3
16
103
221
244
1
8
59
118
156
238
Number of officers and employees.
Dec. 31—
July 1,
1921.
1916
1915
Officers:
Chairman and Federal reserve agent
G overnor
Deputy governor
Other officers
Total officers
Employees:
Banking department
Bookkeeping department
Transit department
Federal reserve agent's department
Auditing department
Fiscal agency department
General
Total emplovees
Total officers and employees
Average number of employees per officer
%
. .
1917
1919
1918
1920
1
1
1
1
1
1
1
1
1
1
2
3
6
11
4
5
8
9
4
2
2
7*
4
361
2
10
13
1
1
2
16
1
2
22
13
15
20
26
21
15
73
5
129
39
169
10
175
38
211
17
10
70
19
203
26
105
65
262
50
353
22
30
141
91
343
79
285
29
26
165
93
27
60
203
576
611
949
1,023
31
7
65
12
211
25
589
44
626
41
969
47
1,049
39
EXPENSES OF FEDERAL RESERVE BANKS.
Salaries of officers and employees.
Dec. 31—
1916
1917
1918
1919
$10,000
20,000
$12,000
20,000
$15,000
20,000
$20,000
25,000
Officers:
Chairman and Federal reserve agent
Governor
Deputy governors
Other officers
$10,000
18,000
7,000
10,750
21,050
48,850
Total (bonus excluded)..
35,000
40,750
53,050
83,850
16,900
5,160
1,080
13,430
4,380
23,370
23,800
19,080
52,710
155,418
35,280
130,150
3,500
3,780
Employees:
Banking department
Bookkeeping department..
Transit department
Federal reserve agent's department
Auditing department
Fiscal agency department..
General
Total (bonus excluded)..
Total officers and employAverage salary payable t o All officers
Officers other than chairman and Federal reserve
agent,
governor and
deputy governors
Employees
1
July 1,
1921.
1920
1
65,199
$23,250
30,000
18,000
83,500
$25,000
30,00')
124,003
123,600
110,199
154,750
202,600
232,819
41,580
179,620
404,268
74,772
386,532
495,472
120,789
305,596
16,080
32,480
321,884
22,800
184,589
66,045
43,992
60,872
200,156
120,447
63,072
52,068
242,732
135,553
6,900
8,040
87,180
16,440
33,540
53,000
207,030
681,612
737,133 1,291,039
1,415,273
68,540
93,750
260,080
765,462
847,332 1,445,78.1
1,617,873
8,750
8,150
6,631
6,450
7,346
7,737
7,792
3,500
1,242
3,583
3,508
1,020
4,441
1,183
5,015
1.206
5,219
1,360
5,618
1,383
2 deputy governors.
Extra compensation paid by the Federal Reserve Bank of Cleveland for the years 1916-1921.
[Salaries sho ,vn are annual salaries. Per cent of extra compensation based on actual salary received during
period.]
Per cent. July 1 to Sept. 30, 1920:
Per cent.
Jan. 1 to Dec. 31, 1916:
Up to $3,250
Up to $1,500
20
10
$1,501 to $3,000
Jan. 1 to Dec. 31, 1918:
15
20
Up to $1,500
$3,001 to $5,500
10
15 Oct. 1 to Dec. 31, 1920:
$1,501 to $3,000
10
$3,001 to $5,000
Up to $1,500
20
Jan. 1 to Dec. 31, 1919:
15
$1,501 to $3,000
20
Up to $1,500
10
$3,001 to $5,500
15 Jan. 1 to Mar. 31, 1921:
$1,501 to $3,000
10
$3,001 to $5,500
16
Up to $1,500
Jan. 1 to Mar. 31, 1920:
12
$1,501 to $3,000
20
Up to $1,500
$3,001 to $5,500
15 Apr. 1 to June 30, 1921:
$1,501 to $3,000
$3,001 to $5,500
10
Up to $1,500....
12
$1,501 to $3,000
Apr. 1 to June 30, 1920:
9
20
$3,001 to $5,500
Up to $1,500
6
15 July 1 to Sept. 30, 1921:
$1,501 to $3,000
10
Up to $1,500
$3,001 to $6,000
10
$1,501 to $3,000
7
$3,001 to $5,500
4
Principal asset and liability items at end of year.
Total cash
reserves.
1915
1916
1917
1918
1919
1920
I n d e x of growth 1915-1920 (1915=1)
Bills
discounted.
Bills bought.
Total earning
assets.
$32,812,000
44,114,000
127,249,000
206,679,000
191,342,000
283,679,000
$539,000
1,007,000
42,896,000
127,334,000
164,517,000
201,343,000
$804,000
10,153,000
21,112,000
37,445,000
48,607,000
27,211,000
$6,546,000
21,825, 000
103,554,000
177,590,000
237, 551,000
253,197,000
9
374
34
39
63
EXPENSES OF FEDERAL RESERVE BANKS.
Principal asset and liability items at end of year—Continusd.
Capital and
surplus.
1915
1916
1917 .
1918
1919
1920. .
•
.
Index of growth 1915-1920 (1915= 1)
Federal reserve
notes in circulation.
Gross
deposits.
$5,941,000
6,022,000
8,026,000
10,849,000
18,622,000
31, 008,000
$25,366,000
75,442,000
156, 980,000
173,951,000
208, 822,000
209,916,000
5
o
$10,708,000
10,272,000
101,883, 003
251,782, 000
264,73S, 000
348,951,000
33
Volume of business transacted during the year.
Bills discounted.
1915
1916
1917
1918
1919
1920
$4,526,000
6,793,000
211,176,000
1,386,118,000
3,125, 856,000
2,895,670,000
.
Index of growth 1915-1920 (1915-1)
640
United States
securities
bought.
$2,963,000
27,542,000
51,007,000
122,800,000
261,751,000
294,602,000
$2,357,000
8,403,000
6,786, 000
257,547,000
284,617,000
878,589,000
$16,651,000
53,398,000
271, 918,000
1, 766, 465,000
3,672,224,000
4,068,861,000
373
244
99 I
Federal reserve Federal reserve
notes issued
notes redeemed
by agent.
by agent.
1915
1916
1917
1918
1919
1920
-
I n d e x of growth 1915-1920 (1915=1)
2 $11,080,000
3,480,000
100,100,000
190,220,000
163, 565,000
249,000,000
2$80,000
3,648,000
5,262,000
29,370,000
146,283,000
154,109,000
22
1,926
1
Currency received from
member and
other banks.
$383,296,000
579,048,000
Number of
Amount of
checks cleared. checks cleared.
1915
1916
1917
1918
1919
1920
.
Index of growth 1915-1920 (1915=1)
1
Total discount
and open
market operations.
Bills bought.
5,901,666
14,008,000
29,789, 000
43,213,000
$3,932,057,000
9,422,430, 000
12,456, 799,000
15,517,119,000
Currency paid
out to
member and
other banks.
$362,123,000
657,982,000
Transactions
through gold
settlement
fund.
a $74,245,000
623,229,000
4,359,064,003
8,794,203,000
11,555,908,000
17, 700,473,000
238
Exclusive of certificates of indebtedness.
2 Nov. 16, 1914, to Dec. 31, 1915.
3
Represents daily average for t h e period May 20, 1915 (date of first settlement), to Dec. 31, 1915, multiplied b y 365.
64
EXPENSES OF FEDERAL RESERVE BANKS.
Expenses of the Federal Reserve Bank of Cleveland.
N o v . 16 t o
Dec. 31,
1914.
Expenses of operation:
SalariesBank officers
Clerical staff....
Special officers and
watchmen
Allother
Federal advisory council,
governors' and Federal
reserve agents' conferences
Directors' meetings, legal
fees, officers' and clerks'
traveling expenses, life
insurance and fidelity
bond premiums
Assessments for Federal
Reserve Board expenses
Taxes and fire insurance
Telephone and telegraph...
Rent, light, heat, and power
Printing and stationery
All other, including postage
and insurance on mail,
security and currency
shipments, repairs and
alterations, etc
Totai expenses of operation
Federal reserve currency (original cost, including shipping
charges)
Miscellaneous charges, account
note issues
Taxes on Federal reserve bank
note circulation
Furniture and equipment
Bank premises
T o t a l expenses
1
2
$3, 750
4,443
1915
1916
1917
1918
1919
$30, 083
36, 089
$39, 767
39, 044
$50, 241
84, 811
$81,307
297, 579
$99, 815
494,639
$143,171
872,339
716
176
4,357
2,769
16,901
9,049
17, 444
71,687
35,149
112, 492
2,660
1,071
1,117
1,789
1,384
917
200
1920
1,133
325
1,404
9,994
16, 070
43,467
57, 911
61,725
33, 412
20, 825
337
538
172
1,084
6,398
1,375
1,313
7,243
12,246
25, 783
204
2,598
19, 720
13,334
43,073
1,939
12,169
40, 016
46,566
58,676
533
21,529
57,462
46,952
63, 246
3,183
35,656
84,093
120, 652
17,361
6,990
10,370
42,795
124, 557
147,841
259, 901
31, 014
129, 561
144, 354
263, 753
717, 740 1,076, 278
1,792, 991
3,738
91,256
182, 092
168, 867
334,679
2,132
3,069
6,569
16,981
63, 519
85, 784
80,491
53, 414
93, 322
141,008
45,166
992,185 1, 396, 031
2, 470,685
2,971
• 11, 593
1
2
9,014
31,014
138, 575
8,097
45,986
158, 321
404,064
Total assessment for Federal Reserve Board expenses to Dec. 31, 1915.
Includes $15,866 expenses prior to Nov. 16, 1914.
Current expenses of the Cincinnati branch of the Federal Reserve Bank of Cleveland.
19181
Salaries:
Bank officers
Clerical staff
#
Special officers and watchmen
Allother
Directors' meetings, legal fees, officers' and clerks' traveling expenses, life
insurance and fidelity bond premiums
Taxes and fire insurance
Telephone and telegraph
Rent, light, heat, and power
,
Printing and stationery
Furniture and equipment
All other, including postage and insurance on mail, security and currency
shipments, repairs and alterations, etc
Total current expenses
b r a n c h opened for business Jan. 10, 1918.
1919
$10, 533
39, 507
234
467
$13, 303
75,211
1,006
6,883
$15,931
110,730
4,192
12,162
4,003
53
1,838
4,902
9,152
6,466
118
2,337
6,955
8,066
7,470
2,864
234
6,611
9,106
17,064
12,297
18,569
27,655
35,736
118, 106
155, 470
226,927
EXPENSES OF FEDEKAL RESERVE BANKS.
65
Current expenses of the Pittsburgh branch of the Federal Reserve Bank of Cleveland.
Salaries:
Bank officers
Clerical staff
Special officers and watchmen
All other
Director' meetings, legal fees, officers' and clerks' traveling expenses, life
insurance and fidelity bond premiums
Taxes and fire insurance
Telephone and telegraph
Rent, light, heat, and power
Printing and stationery
Furniture and equipment
All other, including postage and insurance on mail, security and currency
shipments, repairs and alterations, etc
Total current expenses
1
19181
1919
$10,368
46,824
1,835
362
$14,578
91, 288
3,715
9,194
$19,550
168,171
11,216
18,813
7,978
245
1,336
7,539
11,940
18,805
6,155
724
2,634
10,097
10,217
1920
2,149
23,173
34,811
19,485
40,428
65,849
121,635
199,732
357,577
Branch opened for business Apr. 22,1918.
EXHIBIT D, PART 5.
FEDERAL RESERVE BANK OF RICHMOND.
Comparison of salaries paid to officers of the Federal reserve bank as of Oct. 1, 1921, with
salaries paid to officers of three of the large national banks in Richmond as of Sept.
6, 1921.
Annual salary.
Governor
Chairman and Federal reserve agent
Deputy governor
Do
Assistant to governor
Do:
Assistant Federal reserve agent
Do
Cashier
Counsel
Auditor
Assistant cashier
Do
Do
Do
Assistant auditor
Manager, Baltimore branch
Cashier, Baltimore branch
•
Assistant cashier, Baltimore branch
Assistant Federal reserve agent, Baltimore branch
Assistant cashier, Baltimore branch
Do
Do
Assistant Federal reserve agent, Baltimore branch
Auditor, Baltimore branch
Total
S. Doc. 75, 67-1
$18,000
15,000
15,000
10,000
7, 500
7, 500
7,000
7,000
7, 500
5, 000
5, 000
4, 500
4, 500
4, 500
4,500
3, 600
10, 000
5, 400
4, 500
4, 200
4,000
3,600
3, 600
3,000
3, 000
167,400
5
66
EXPENSES OF FEDERAL RESERVE BANKS.
National banks in Richmond.
Annual salary.
Position.
Bank A. Bank B . BankC.
Chairman
President
Vice president
Do
Do
Do
Do .
Other officers
$15,000
20,000
6,500
6,500
6,000
600
...
..I
Total
11,400
$15,000
7,500
6,500
6,000
3,000
5,000
15,000
$25,000
12,000
8,000
8,000
5,500
5,000
26,100
66,000
58,000
89,600
SUMMARY.
Annual salaries.
Number
of
officers.
Federal reserve bank
Bank A
BankB
BankC
Total.
Average.
25 $167,400
10
66,000
10
58,000
13
89,600
..
$6 696
6^600
5,800
6 892
Index of growth in number of officers and employees, in their aggregate salaries, and in
business of the bank.
[1915=1.]
Assets and liabiliVolume of business.
ties.
Personnel.
1915
1916
1917
1918
1919
1920
Officers and employ Qes.
Officers.
Year.
Number. Salaries. Number.
Salaries.
1
2
4
8
13
22
1
1
2
5
9
16
1
1
1
2
3
5
1
1
2
2
3
5
..
Earning
assets.
Discount
Federal and
open Gold setreserve
tlement
note cir- market
operafund.
culation. tions.
1
1
6
13
17
17
1
1
10
50
93
77
1
1
4
9
10
10
1
4
11
19
48
60
Number of officers and employees.
Dec. 31—
Total officers
Employees: ^
^
^
PookkpwiTiK department
Transit department
Federal reserve agent's department .
Auditing department;
Fiscal agency department
General
Total employees
Total officers and employees
Average number of employees per officer
1917
1916
1915
Officers:
Chairman and Federal reserve agent
Governor
Deputy governor
Other officers
4
l
l
l
l
4
6
10
3
7
1
11
5
36
1
18
6
43
2
5
6
26
30
6
59
63
15
1
1
1
1
1
1
1
3
1918
1
1
1
5
8
1919
1920
1
1
2
9
1
1
2
14
1
1
2
16
13
18
20
82
13
157
9
20
14
63
12
79
4
40
48
169
30
292
33
23
48
115
103
109
17
246
254
31
388
401
30
146
30
276
15
24
71
87
649
667
36
54
73
710
730
36
67
EXPENSES OE FEDERAL RESERVE BANKS.
Salaries of officers and employees.
Dec. 31.
Officers:
Chairman and Federal reserve agent
G overnor
Deputy governor
Other officers
Total (bonus excluded)...
Employees:
Banking department
Bookkeeping department...
Transit department
Federal reserve agent's department
Auditing department
Fiscal agency department..
General
Total (bonus excluded)...
Total officers and employees
Average salary payable to—
All officers
Officers other than chairman and Federal reserve
agent, governor, and
deputy governor
Employees
July 1,
1921.
1915
1916
1917
1918
1919
$10,000
10,000
4,000
3,500
$10,000
12,000
5,000
3,500
$10,000
15,000
6,000
8,550
$10,000
15,000
7,500
14,000
$12,000
18,000
27,500
30,500
39,550
46,500
12,742
4,748
2,278
13,9.56
5,520
11,599
22,880
4,980
21,954
76,953
9,640
59,485
945
916
2,400
21,024
8,540
81,778 I 245,020
1920
$15,000
18,000
25,000
85,200
1
$15,000
18,000
24,000
69,250
1
80,800
126,250
143,200
93,410
14,540
125,228
185,900
37,410
266,848
221,760
38,160
288,090
7,202
19,900
54,930
36,810
63,330
83,560
38,860
46,050
85,726
110,932
82,640
43,770
60,4i0
140,900
399,968
—
771,726
-875,760
117,000
33,800
6,439
8,819
27,152
40,810
54,652
71,310
121,328
291,520
480,768
897,976
1,018,960
6,875
7,625
6,592
5,812
6,215
7,014
7,160
3,500
1,044
3,500
2,850
794
2,800
3,756
1,030
4,946
1,190
5,325
1,233
i Two deputy governors.
Extra compensation paid by the Federal Reserve Bank of Richmond for the years 1917-1921.
{Salaries shown are annual salaries. Per cent of extra compensation based on actual salary received during
period.]
Jan. 1 to Dec. 31, 1917:
Less than $1,500
$1,500 to $3,600
Jan. 1 to Dec. 31, 1918:
Less than $1,500
$1,500 to $5,000
Jan. 1 o Dec. 31, 1919:
Up to $1,500
$1,501 to $3,000
$3,001 to $7,500
Per cent.
15
10
15
10
25
20
15
Jan. 1 to June 30, 1920:
Less than $1,500
$1,501 to $3,000
$3,001 to $7,500
July 1 to Dec. 31, 1920: l
On the first $1,500 or part
On the next $500 or part
On the next $500 or part
On the next $500 or part
Per cent.
25
20
15
thereof.
thereof.
thereof.
thereof.
25
20
15
10
Principal asset and liability items at end of year.
Total cash
reserves.
1915
X916
1917
1918
1919
1920
.
Index of growth 1915-1920 (1915=1)....
Bills discounted.
$25,049,000
41,198,000
62,506,000
85,399,000
81 442,000
87,152,000
3
$7,507,000
2,880,000
29,657,000
86,242,000
105,002,000
115,473,000
—
Bills bought.
Total earning
assets.
$150,000
4,334,000
13,156,000
5,465,000
16,405,000
5,048,000
$7,739,000
10,537,000
46,018,000
97,725,000
134,902,000
134,017,000
34
17
This payment to apply to officers and employees receiving up to $5,000 per annum. No extra
compensation to apply on that portion of salaries in excess of $3,000. Extra compensation not paid to
war loan organization.
68
EXPENSES OF FEDERAL RESERVE BANKS.
Principal asset and liability items at end of year—Continued.
Gross deposits.
Federal Reserve
notes in
circulation.
$3,354,000
3,346,000
3,780,000
5,218,000
10,213,000
15,830,000
$16,830,000
44,833,000
66,781,000
93,972,000
144,490,000
100,474,000
$14,816,000
19,293,000
56,564,000
137,478,000
145,765,000
155,169,000
5
6
10
Capital and
surplus.
1915
1916
1917
1918
1919
1920
•
. .
Index of growth 1915-1920 (1915=1)
Volume of business transacted during the year.
Bills discounted.
1915 .
1916
1917
1918
1919
1920
Index of growth 1915-1920 (1915=1)
Bills bought.
$44,891,000
34,377,000
401,221,000
2,159,845,000
4,130,943,000
3,346,322,000
$250,000
11,313,000
53,098,000
70,766,000
52,977,000
51,712,000
75
207
Federal reserve Federal reserve
notes issued notes redeemed
by agent.
by agent.
1915
1916
1917
1918 . .
1919
1920
.
..
-
Index of growth 1915-1920 (1915-1)
....
* $16,680,000
14,336,000
51,770,000
125,365,000
162,777,000
179,004,000
11
United States Total discount
and open marsecurities
ket operations.
bought.
$4,335,000
* 1,593,000
32,723,000
40,441,000
"84,002,000
77
Currency received from
member and
other banks.
Index of growth 1915-1920 (1915=1)
Currency paid
out to member
and other
banks.
8
$1,050,000
9,535,000
11,430,000
35,138,000
162,070,000
169,675,000
$169,276,000
194,500,000
$177,321,000
243,979,000
162
Number of
Amount of
checks cleared. checks cleared.
1915....
1916
1917....
1918
1919
1920
$45,262,000
50,555,000
456,027,000
2,263,334,000
4,224,361,000
3,482,036,000
5,688,000
11,519,000
20,934,000
33,732 000
$3,403,950,000
6,983,383,000
9,304,180,000
11,505,945,000
Transactions
through gold
settlement
fund.
»$269,636,000
1,027,139,000
2,968,692,000
5,069,655,000
13,032,545,000
16,157,994,000
60
1 Exclusive of certificates of indebtedness.
2 Nov. 16,1914, to Dec. 31,1915.
' Represents daily average for the period May 20,1915 (date of first settlement), to Dec. 31, 1915, multiplied by 365.
69
EXPENSES OF FEDERAL RESERVE BANKS.
Expenses of the Federal Reserve Bank of Richmond.
N o v . 16
t o Dec.
31, 1914.
Expenses of operation:
SalariesBank officers
$4,783
Clerical staff
2,592
Special officers and
watchmen
20
All other
181
Federal advisory council,
governors' and Federal
reserve agents' conferences . . .
75
Directors' meetings, legal
fees, officers' and clerks'
traveling expenses, life insurance, and fidelity bond
premiums
>•
2,567
Assessments for Federal
Reserve Board expenses
Taxes and fire insurance
Telephone and telegraph
114
Rent, light, heat, and power.
964
Printing and stationery
312
All other, including postage and insurance on
mail, security and currency shipments, repairs
and alterations, etc
«13,195
Total expenses of
operation
Federal reserve currency (original cost including shipping
charges)
Miscellaneous charges, account
note issues
Taxes on Federal reserve bank
note circulation
Furniture and equipment
Bank premises
Total expenses
24,803
24,803
1915
1916
1917
1918
1919
$25,978
24,736
$31,428
38,388
$36,200
64,557
$48,455
173,118
$74,796
326,746
$105,945
617,525
1,026
1,389
648
1,774
700
1,882
4,868
5,008
7,497
16,283
15,068
34,749
1,140
1,916
701
681
1,033
1,072
1920
10,349
11,578
9,427
17,819
25,196
49,368
118,266
11,743
577
6,495
4,039
617
7,300
6,852
14,256
2,629
1,343
8,574
11,994
19,814
1,823
5,070
11,854
36,516
29,535
11,452
12,479
13,034
39,083
34,555
9,699
31,019
17,599
84,345
9,080
12,525
37,330
83,241
124,976
143,552
103,075
124,769
189,593
408,267
682,110
1,144,494
14,398
18,248
58,903
118,822
119,347
170,101
3,626
6,700
28,582
46,749
32,468
49,420
52,605
103,126
911,927
1,516,075
2,349
4,514
28,414
91,786
18,245
119,822
147,531
280,536
643,820
1
Total assessment for Federal Reserve Board expenses to Dec. 31,1915.
* Includes $12,012 expenses prior to Nov. 16,1914.
Current expenses of the Baltimore branch of the Federal Reserve Bank of Richmond.
19181
Salaries:
Bank officers
Clerical staff
Special officers and watchmen
All other
Directors' meetings, legal fees, officers' and clerks' traveling expenses, life
insurance and fidelity bond premiums
Taxes and fire insurance
Telephone and telegraph
,
Rent, light, heat, and power
Printing and stationery
Furniture and equipment
All other, including postage and insurance on mail, security and currency
shipments, repairs and alterations, etc
Total current expenses
1 Branch opened for business Mar. 1,1918.
1919
1920
$6,659
41,830
2,891
1,655
$13,490
90,833
5,742
4j 121
$21,770
173,606
10,122
5,558
3,210
94
1,051
1,607
8,649
27,181
5,511
10,098
1,331
2,788
12,202
21,472
5,645
6,878
4,948
3,378
22,316
34,129
21,876
29,547
35,910
116,703
197,135
324,260
70
EXPENSES OF FEDEKAL, RESERVE BANKS.
EXHIBIT D, PART 6.
FEDERAL RESERVE BANK OP ATLANTA.
Comparison of salaries paid to officers of the Federal reserve bank as of Oct. 1, 1921, with
salaries paid to officers of three of the large national banks in Atlanta as of Sept. 6,1921.
Annual salary.
Governor
Chairman and Federal reserve agent
Deputy governor
Do...
Cashier
Secretary
General auditor
Assistant Federal reserve agent
Assistant cashier
Assistant Federal reserve agent
Assistant cashier
Do
Do
Do
Manager, Birmingham branch
Cashier, Birmingham branch
Assistant Federal reserve agent and auditor, Birmingham branch
Manager, Jacksonville branch
Cashier, Jacksonville branch
Assistant Federal reserve agent and auditor, Jacksonville branch
Manager, Nashville branch
Cashier, Nashville branch
Assistant Federal reserve agent and auditor, Nashville branch
Manager, New Orleans branch
Assistant manager, New Orleans branch
Cashier, New Orleans branch
Assistant cashier, New Orleans branch
Do
Assistant Federal reserve agent and auditor, New Orleans bran eh
Manager, Savannah agency
Assistant manager, Savannah agency
$18, 000
12,000
12, 000
7,500
6,900
6,900
6, 000
6, 000
5, 000
4, 500
4, 200
4,200
4, 200
4, 000
6,000
4,200
2, 700
5,500
3, 600
2, 700
4, 800
3,200
2, 700
11, 000
5, 000
4, 500
4, 000
3,000
4, 000
4, 000
3,700
Total
176, 000
National banks in Atlanta.
Annual salary.
Position.
Bank A. BankB.
Chairman
President
Vice president
Do
Do
Other officers..
$17,500
17,500
14,500
10,000
7,500
28,900
Total...,
95,900
$20,000
18,000
15,000
6,250
39,550
BankC.
$15,000
12,500
6,300
29,820
63,620
SUMMARY.
Annual salaries.
to
Federal reserve bank
Bank A
BankB
BankC
Number
of officers.
Total.
31 $176,000
95,900
98,800
63,620
12
10
11
Average.
$5,677
7,992
9,880
5,784
71
EXPENSES OF FEDERAL RESERVE BANKS.
Index of growth in number of officers and employees, in their aggregate salaries, and in
business of the bank.
[1915=1.]
Assets and liabilities.
Personnel.
Year.
Volume of
business.
Officers and employees.
Federal Discount
Gold
open- settleEarning reserve and
assets. note cir- market
ment
culation. operafund.
tions.
Number. Salaries. Number. Salaries.
Officers.
1
1
1
3
3
4
1915
1916
1917
1918
1919
1920
1
2
3
8
9
11
1
1
1
2
3
4
1
1
3
6
8
9
1
1
3
12
15
18
1
1
4
29
60
66
1
1
4
7
9
10
1
3
10
21
29
41
Number of officers and employees.
Dec. 31—
1915
Officers:
Chairman and Federal reserve agent
Other officers
Total officers
1916
1
1
1917
1918
1
1
1
1
1
1
1919
1920
4
4
3
14
1
1
1
17
6
6
5
16
20
23
23
21
35
85
98
149
47
102
16
25
72
89
.*.
1
1
1
20
18
22
=
Employees:
Banking department
Bookkeeping department
Transit department...
Federal reserve agent's department
Auditing denartment
.a
5
24
3
6
28
3
15
68
5
32
109
10
5
6
51
4
93
35
71
46
112
44
104
17
22
60
64
35
59
127
301
366
423
500
41
6
65
10
132
25
317
19
386
18
446
18
522
23
3
2
2
Genaral
Total employees
Total officers and emolovees
Average number of employees per officer
1
1
2
Salaries of officers and employees.
Dec. 31—
Officers:
Chairman a n d Federal re-
1915
1916
$7,500
9,000
$9,000
9,000
1917
1918
1919
1920
$10,000
10,000
$10,000
10,000
$12,000
18,000
10,000
84,800
$12,000
18,000
119,500
78,800
13,100
12,060
11,380
53,400
$10,000
15,000
7,500
69,100
Total (bonus excluded)...
29,600
30,060
31,380
73,400
101,600
124,800
128,300
Employees:
Banking department
Bookkeeping d e p a r t m e n t . . .
Transit department
23,928
3,600
1,260
21,828
5,100
15,900
37,690
6,480
20,180
92,770
17,100
53,79\)
113,850
33,000
98,400
125,568
45,600
106,010
195,370
57,420
111,530
Governor
Other officers
12 deputy governors.
72
EXPENSES OF FEDERAL RESERVE BANKS.
Salaries of officers and employees—Continued.
Dec. 31--1915
1916
1917
Employees—Continued.
Federal reserve agent's department
Auditing department
Fiscal agency department.,
General
$3,200
$4,380
$5,220
61,010
3,120
Total (bonus excluded)...
35,168
Total officers and employees
,
Average salary pay able to:
All officers
Officers other than chairman and Federal reserve
agent, governor, and deputy governors
Employees
,
4,0
3,180
•
51,288
133,700
...
=
July 1,
1921.
1918
=
1919
1920
$9,180
$21,250
102,240
25,598
82,980
36,288
$30,277
34,080
79,820
64,568
$39,120
44,860
100,700
91,996
385,768
485,923
640,996
487,368
610,723
769,296
5,080
5,426
5,832
4,065
1,054
4,240
1,149
4,378
1,281
300,678
, . _
,.
,
.
•
81,348
64,768
165,080
5,010
4,933
3,275
1,005
3,015
869
=
374,078
6,276
4,587
3,793
1,053
3,814
998
Extra compensation paid by the Federal Reserve Bank of Atlanta for the years 1918-1921,
[Salaries shown are annual salaries. Per cent of extra compensation based on actual salary received during
period.]
Per cent. July 1 to Dec. 31, 1920:
Per cent.
Jan. 1 to Dec. 31, 1918:
Up to $1,500
$1,501 to $3,000....
$3,001 to $5,000....
Jan. 1 to Dec. 31, 1919:
Up to $1,500
$1,501 to $3,000....
$3,001 to $5,000....
Jan. 1 to June 30, 1920:
Up to $1,500
$1,501 to $3,000....
$3,001 to $6,000....
20
15
10
25
20
15
Up to $1,500
$1,501 to $3,000....
$3,001 to $6,000....
Jan. 1 to June 30, 1921:
25
Up to $1,500
$1,501 to $3,000....
20
15
$3,001 to $6,000....
10
25
20
15
Principal asset and liability items at end of year.
Total cash
reserves.
1915
1916
1917
1918
1919
1920
Index of growth, 1915-1920 (1915=1)....
Bills
discounted.
.
..
Index of growth, 1915-1920 (1915=1)
Total earning
assets.
$23,282,000
34,766,000
72,010,000
63,839,000
104,908,000
89,340,000
$8,131,000
2,964,000
15,028,000
84,035,000
93,052,000
132,600,000
$72,000
4,448,000
6,497,000
12,515,000
16,639,000
3,571,000
$8,533,000
10,348,000
25,697,000
103,183,000
125,736,000
152,961,000
4
16
50
13
Gross deposits.
Federal reserve
notes in
circulation.
$13,702,000
31,509,000
51,776,000
72,586,000
101,005,000
73,551,000
$17,656,000
24,869,000
64,915,000
120,672,000
155,511,000
173,406,000
•
1915
1916
1917
1918
1919
1920...
Bills bought.
Capital and
surplus.
$2,422,000
2,450,000
2,853,000
3,966,000
8,123,000
12,396,000
5
if
10
73
EXPENSES OF FEDERAL RESERVE BANKS.
Volume of business transacted during the year.
Bills discounted.
1915
1916
1917
1918
1919
1920
. ..
. .
...
.
Bills bought.
$34,209,000
22,324,000
95,115,000
930,130,000
2,005,778,000
2,231,946,000
$72,000
12,544,000
25,387,000
45,478,000
51,661,000
39,577,000
65
550
Index of growth 1915-1920 (1915=1)
Total discount
a n d openmarket operations.
United States
securities
bought.
$34,611,000
37,884,000
129,193,000
1,016,113,000
2,086,263,000
2,290,420,000
$2,596,000
8,275,000
40,238,000
28,823,000
18,897,000
1
66
Currency
Federal reserve Federal reserve
notes issued
notes redeemed received from
member
and
by agent.
by agent.
other banks.
1915
1916
1917
1918
1919
1920
.
»$21,226,000
17,705,000
54,893,000
117,510,000
183,598,000
196,035,000
s $2,276,000
10,736,000
13,945,000
60,757,000
147,110,000
176,383,000
9
77
Index of growth 1915-1920 (1915=1)
Currency
paid out to
member and
other banks.
$219,365,000
335,485,000
.$175,453,000
288,976,000
Number of
Amount of
checks cleared. checks cleared.
Transactions
through gold
settlement
fund.
8
1915
1916
1917
1918
1919 . . . .
1920
4,031,000
7,449,000
14,256,000
17,884,000
$153,964,000
433,980,000
1,585,108,000
3,292,553,000
4,418,973,000
6,322,511,000
$1,636,315,000
3,588,293,000
5,487,105,000
6,131,660,000
Index of growth 1915-1920 (1915—1)
41
1
Exclusive of certificates of indebtedness,
a Nov. 16,1914, to Dec. 31,1915.
« Represents daily average for the period May 20, 1915 (date of first settlement), to Dec. 31,1915, multiplied by 365.
Expenses of the Federal Reserve Bank of Atlanta.
Nov. 16
to Dec.
31, 1914.
Expenses of operation:
SalariesBank officers
Clerical staff
Special officers and
watchmen
All other
Federal advisory council,
governors' and Federal
reserve agents' conferences
Directors' meetings, legal
fees, officers' and clerks'
traveling expenses, life
insurance, and fidelity
bond premiums
Assessments for Federal
Reserve Board expenses..
Taxes and fire insurance....
Telephone and telegraph...*
1
1915
1916
1917
1918
1919
$2,663
1,872
$26,444
24,674
$31,867
39,738
$36,940
58,172
$70,643
124,938
$116,952
289,855
$156,996
433,196
170
2,484
3,258
3,424
5,280
3,060
10,037
12,934
15,631
24,502
63
1,522
1,637
779
667
1,178
1,771
948
67
15,641
11,517
11,083
16,075
32,612
57,310
U3,174
8,547
795
935
10,154
1,211
1,429
15,369
3,276
5,796
22,391
8,268
27,314
27,882
10,774
54,335
Total assessment for Federal Reserve Board expenses to Dec. 31,1915.
1920
74
EXPENSES OF FEDERAL RESERVE BANKS.
Expenses of the Federal Reserve Bank of Atlanta—Continued.
Nov. 16
to Dec.
31,1914.
Expenses of operation—Contd.
Rent, light, heat, and power.
Printing and stationery
All other, including postage
and insurance on mail, security and currency shipments, repairs and alterations, etc
Total expenses of
operation
Federal Reserve currency (original cost, including shipping
charges)
Miscellaneous charges, account
Taxes on Federal Reserve bank
note circulation.
. .
Furniture and equipment
Bank premises
Total expenses
1915
1916
1917
1918
1919
1920
$813
74
$7,943
4,729
$13,005
5,473
$15,226
9,357
$19,484
23,782
$17,907
46,294
$25,528
80,240
* 15,709
7,252
17,627
38,471
90,553
137,341
158,444
22,379
104,658
133,604
186,246
378,923
723,083
1,046,609
24,574
12,167
69,128
149,390
148,735
126,009
9,314
11,536
72,808
63,958
76,057
1,385,441
22,379
2,317
4,442
18,923
89,846
41,561
46,844
458
131,549
150,213
274,297
627,473
972,217
* Includes $15,255, expenses prior to Nov. 16,1914.
Current expenses of the Jacksonville branch of the Federal Reserve Bank of Atlanta.
Salaries:
Bank officers
Clerical staff
, Special officers and watchmen
All other
Directors' meetings, legal fees, officers' and clerks' traveling expenses, life
insurance andfidelitybond premiums
Taxes andfireinsurance
Telephone and telegraph
Rent, light, heat, and power
Printing and stationery
Furniture and equipment
All other, including postage and insurance on mail, security and currency
shipments, repairs and alterations, etc
Total current expenses..
1
19181
1919
$5,545
6,270
37
$10,920
19,963
304
203
$13,369
32,760
1,200
2,423
2,411
1,606
22
7,989
6,431
6,254
5,686
1920
24
261
1,039
2,598
5,300
4,162
4,831
3,239
4,482
12,852
18,199
26,423
59,780
95,939
i Branch opened for business Aug. 5, 1918.
Current expenses of the Nashville branch of the Federal Reserve Bank of Atlanta.
1920
Salaries:
Bank officers
Clerical staff
Special officers and watchmen
All other
Directors' meetings, legal fees, officers' and clerks' traveling expenses, life insurance
andfidelitybond premium
Taxes andfireinsurance
Telephone and telegraph
Rent, light, heat, and power
Printing and stationery
Furniture and equipment
All other, including postage and insurance on mail, security and currency shipments,
repairs and alterations, etc.
Total current expenses
1
Branch opened for business Oct. 21,1919.
$11,267
30,986
376
431
82,464
EXPENSES OF FEDERAL RESERVE BANKS.
75
Current expenses of the New Orleans branch of the Federal Reserve Bank of Atlanta.
19151
Salaries:
Bank officers
Clerical staff
Special officers and watchmen
All other
Directors' meetings, legal fees, officers' and clerks'
traveling expenses, life insurance, and fidelity bond
premiums
Taxes and fire insurance
^Telephone and telegraph
Rent, light, heat, and power
printing and stationery
Furniture and equipment
Bank premises
All other, including postage and insurance on mail,
security and currency shipments, repairs and alterations, etc
Total current expenses.
$2,139
2,572
434
1916
1917
1918
1919
$7,108 $10,566 $20,426 $26,530
7,237 9,630 20,072 46,807
1,411
1,476
1,845
687 1,823
1,365
1,349
2,118
97
953
732
2,279
396
3,093
547
1,947
449
3,171
1,184
2,524
712
3,122
6,001
11,283
26,210
37,119
1920
$28,439
66,956
4; 759
3,685
9,064
4,738
4,190
598
1,219
3,746
6,138
5,741
4,532
4,078
4,721
9,468
7,748
116
17,508
21,833
31,705
76,429 136,466
190,587
5,994
16,283
10,726
* Branch opened for business Sept. 10,1915.
Current expenses of the Birmingham
branch of the Federal Reserve Bank of
19181
Salaries:
Bank officers
Clerical staff
Special officers and watchmen
Allother
Directors' meetings, legal fees, officers' and clerks' traveling expenses, life
insurance, and fidelity bond premiums
Telephone and telegraph
Rent, light, heat, and power
Printing and stationery
Furniture and equipment
All other—including postage and insurance on mail, security and currency
shipments, repairs and alterations, etc
Total current expenses.
Atlanta.
1919
1920
$5,350
5,913
300
$11,698
16,320
1,165
418
$13, 878
23,155
1,041
612
400
2,400
1,894
682
1,155
3,328
5,295
2,405
2,846
630
6,344
6,657
3,386
3,003
4,316
10,728
16,310
21,867
55,358
76,290
i Branch opened for business Aug. 1,1918.
Current expenses of the Savannah agency of the Federal Reserve Bank of
Atlanta.
1920
Salaries:
Bank officers
Clerical staff
All other
Directors' meetings, legal fees, officers' and clerks' traveling expenses, life insurance
and fidelity bond premiums
_
,
Telephone and telegraph
,
Rent, light, heat, and power
,
Printing and stationery
,
Furniture and equipment
All other, including postage and insurance on mail, security and currency shipments,
repairs and alterations, etc
Total current expenses.
* Agency opened for business Feb. 4,1919.
12, 443
76
EXPENSES OF FEDERAL RESERVE BANKS.
EXHIBIT D, PART 7.
FEDERAL RESERVE BANK OF CHICAGO.
Comparison of salaries paid to officers of the Federal reserve bank as of Oct. 1, 1921]
with salaries paid to officers of three of the large national banks in Chicago as of Sept.
6, 1921'.
Annual salary
Governor
$35, 000
Chairman and Federal reserve agent
24. 000
Deputy Governor
20, 000
Do
18, 000
Do
13, 800
Controller, loans and credits
.
10, 000
Assistant Federal reserve agent and secretary
10,^000
Assistant Federal reserve agent
9, 000
Counsel
8, 000
Auditor
7, 000
Controller, fiscal agency
7, 000
Controller, investments
6, 500
Controller, collections
6, 500
Controller, cash and custodies
6, 500
Controller, accounting
6, 500
Controller, administration
6, 500
Controller, member bank accounts.
.....
6, 500
Manager, bank relations department
6, 000
Manager, loans (Illinois and Indiana)
5, 500
Manager, securities department.
5, 500
Manager, cash department
5, 500
Manager, Government bond department
5, 500
Manager, personnel department.
5, 500
Manager, statistical department
5, 500
Assistant auditor
5, 000
Manager, service department
5, 000
Manager, disbursing department
5, 000
Manager, cash custody department
5, 000
Manager, credit department
5, 000
Manager, loans (Michigan and Wisconsin)
4, 500
Manager, member bank accounts
4, 500
Manager, accounting department
4, 500
Manager, investment department
4, 000
Manager, collection department
4, 000
Manager, planning department
4, 000
Manager, Detroit branch
11, 000
Cashier, Detroit branch
6, 000
Assistant cashier, Detroit branch
5, 500
Assistant Federal reserve agent, Detroit branch.
5, 500
Assistant cashier, Detroit branch
4, 500
Acting assistant Federal reserve agent, Detroit branch
3, 000
Total
325,800
National banks in Chicago.
Annual salary.
Position.
Bank A. Bank B. BankC.
Chairman.....
President
Vicepresident.
Do
Do
Do
Do
Do
Do
$36,000
25,000
20,000
18,000
15,000
12,000
9,000
9,000
37,500
37,500
37,500
26,000
26,000.
15,000
15,000
$60,000
8,33320,000
18,000
18,000
14,000
12,000
EXPENSES OF FEDERAL RESERVE BANKS.
National banks in Chicago—Continued.
Annual salary.
Position.
Bank A. Bank B. Bank C.
Vice President—Continued.
Do. ..
$9,000
8,000
7,500
6 000
34,500
Do
Do
Do
Other officers
Total
$15,000
12,000
9,00Q-
209,000
65,000
$38,500
420,500
188,833
SUMMARY.
Annual salaries.
Number
of
officers.
Federal reserve bank
Bank A
Bank B
Bank C .
41
19
22
12
Total.
Average.
$325,800
209,000
420,500
188,833
$7,946
11,000
19 114
15,736
Index of growth in number of officers and employees, in their aggregate salaries, and in
business of the bank.
[1915=1.1
Personnel.
Year.
Assetsand liabilities. Volume of business.
Officers and employees.
Federal Discount
and open
Earning reserve
note
market
assets. circulaopertion.
Number. Salaries. Number. Salaries.
ations.
Officers.
1
1
2
5
7
9
1915
1916
1917
1918
1919
1920
1
1
2
3
4
5
1
2
7
16
24
35
1
2
11
21
37
47
1
2
5
10
15
25
1
2
67
160
186
203
1
3
23
132
213
281
Goldsettlement
fund.
1
3
15
27
39
45
Number of officers and employees.
Dec. 31—
1915
Officers:
Chairman and Federal reserve agent
Deputy governor
Other officers
Total officers
Employees:
Banking department
Bookkeeping department
Transit department
Federal reserve agent's department
Auditing deoartment
Fiscal agency department
General
$otal employees
Total officers and employees
Average number of employees per officer
.
1916
1917
July 1,
1921.
1918
1919
1920
1
1
1
1
1
1
1
2
1
1
1
6
1
1
1
17
1
1
1
24
1
1
2
32
1
1
3
39
4
5
9
20
27
36
44
18
4
9
2
33
9
40
2
36
10
61
5
155
24
124
11
13
21
166
77
292
189
274
31
299
17
27
277
247
370
40
458
37
32
300
458
455
72
444
71
34
257
404
46
105
355
795
1,172
1,695
1,737
50
12
110
21
364
39
815
40
1,199
44
1,731
47
1,781
39
78
EXPENSES OF FEDEKAL KESERVE BANKS.
Salaries of officers and employees.
Dec. 31—
July 1,
1921.
1915
1916
1917
1918
1919
1920
Officers:
Chairman and Federal reserve agent
Governor
Deputy governor
Other officers
$10,000
20,000
10,000
4,000
$10,000
20,000
10,000
7,500
$10,000
24,000
11,000
22,500
$12,000
24,000
12,000
67,000
$18,000
30,000
15,COO
117,000
$24,000
35,000
126,000
141,950
$24,000
35,000
2 51,8G0
222,600
Total (bonus excluded)...
44,000
47,500
67,500
115,0C0
180,000
226,950
333,400
21,426
4,100
8,700
31,880
8,700
30,240
47,880
9,520
49,280
180,910
25,100
109,160
352,782
38;580
207,236
561,180
54,620
510,460
673,400
105,480
557,620
7,2C0
7,8C0
13,800
17,120
215,930
61,130
354,370
183,800
33,460
34,900
365,538
274,091
72,560
48,080
432,200
541,400
138,450
58,280
388,880
522,820
397,540
870,460 1,306,587 2,220,500 2,444,8
—
985,460 1,486,587 2,447,450 2,778,330
Employees:
Banking department
Bookkeeping department...
Transit department
Federal reserve agents' dement
Auditing department
Fiscal agency department..
General
11,134
20,985
Total (bonus excluded)...
52,560
99,605
—
Total officers and employees
Average salary payable to—
All officers
Officers other than chairman and Federal reserve
agent, governor, and deputy governors
Employees
96,560
147,105
11,000
9,500
4,000
1,142
= = =
465,040
7,500
3,750
949
3,750
1,120
5,750
6,666
6,304
7,577
3,941
1,094
4,875
1,115
4,436
1,310
5,708
1,4C8
1 Two deputy governors.
2 Three deputy governors.
Extra compensation paid by the Federal Reserve Bank of Chicago for the years 1916-1921,
[Salaries shown are annual salaries. Per cent of extra compensation based on actual salary received
during period.]
Percent.
Jan. 1 to Sept. 30, 19l9:
Percent.
Jan. 1 to Dec. 31, 1916:
Up to $3,500
Jan. 1 to Dec. 31, 1917:
Up to $6,000
Jan. 1 to Dec. 31, 1918:
Up to $1,500
$1,501 to $3,000
$3,001 to $5,000
5
10
20
15
10
Up to $1,500
$1,501 to $3,000
$,^,001 to$5,000
Jan. 1 to Dec. 31, 1920:
Up to $1,500
$1,501 to $3,000
$3,001 to $6,500 l
20
15
10
20
15
10
Principal asset and liability items at end of.year.
Total cash
reserves.
1915
1916
1917
1918
1919
1920
Index of growth 1915-1920 (1915= 1)
Bills discounted.
Bills bought.
Total earning
assets.
$41,428,000
61,563,000
230,834,000
423,574,000
381,345,000
311,520,000
$4,005,000
4,438,000
105,119,000
164,090,000
286,909,000
475,563,000
$2,016,000
10,337,000
9,182,000
62,880,000
92,650,000
25,741,000
$11,495,000
26,476,000
124,686,000
247,091,000
423,824,000
545,406,000
8
119
13
47
* Only 1 officer received more than $6,000, his compensation being at the rate of $6,500 per annum.
79
EXPENSES OF FEDERAL RESERVE BANKS.
Principal asset and liability items at end of year—Continued.
Gross deposits.
Federal reserve
notes in circulation.
$6,645,000
6,684,000
9,308,000
14,501,000
26,639,000
42,893,000
$55,067,000
111,987,000
201,245,000
289,488,000
369,130,000
320,081,000
$2,685,000
4,536,000
180,628,000
428,820,000
500,139,000
545,395,000
6
6
203
Capital and
surplus.
1915
1916
1917
1918.. .
1919
1920
Index of growth 1915-1920 (1915-1)
Volume of business transacted during the year.
Bills discounted.
1915
1916
1917
1918
1919
1920
Index of growth 1915-1920 (1915= 1)
Bills bought.
$9,239,000
23,178,000
521,872,000
3,265,850,000
4,556,312,000
6,305,492,000
$5,782,000
27,061,000
61,143,000
122,787,000
292,012,000
345,021,000
$4,026,000
8,644,000
141,379,000
146,389,000
848,524,000
847,954,000
$26,731,000
68,616,000
626,558,000
3,536,026,000
5,696,848,000
7,498,467,000
682
60
211
281
Federal reserve Federal reserve
notes issued
notes redeemed
by agent.
by agent.
1915
1916
1917
1918
1919
1920
Index of growth 1915-1920 (1915= 1)
United States Total discount
securities
and open marbought.
ket operations.
2 $5,140,000
4,381,000
188,600,000
305,840,000
324,320,000
345,330,000
2$760,000
1,578,000
4,994,000
45,691,000
239,799,000
246,552,000
67
324
Currency received from
member and
other banks.
Currency paid
out to member
and other
banks.
$648,102,000
971,684,000
$614,188,000
1,037,095,000
Number of
Amount of
checks cleared. checks cleared.
1915
1916
1917
1918 . .
1919
1920
Index of growth 1915-1920 (1915= 1)
7,532,000
17,845,000
37,592,000
60,520,000
$5,363,610,000
10,957,230,000
14,125,543,000
18,793,460,000
Transactions
through gold
settlement
fund.
3$526,575,000
1,573,807,000
7,661,187,000
13,993,659,000
20,733,397,000
23,714,809,000
45
1 Exclusive of certificates of indebtedness.
2 Nov. 16, 1914, to Dec. 31, 1915.
Represents daily average for the period May 20,1915 (date of first settlement), to Dec. 31.1915, multiplied by 365.
3
80
EXPENSES OF FEDERAL RESERVE BANKS.
Expenses of the Federal Reserve Bank of Chicago.
Nov. 16
to Dec.
31,1914.
Expenses of operation:
Salaries—
Bank officers
Clerical staff
Special officers and
watchmen
Allother
Federal advisory council,
governors' and Federal
reserve agents' conferences - .
Directors' meetings, legal
fees, officers' and clerks'
traveling expenses, life
insurance and fidelity
bond premiums
Assessments for Federal
Reserve Board expenses..
Taxes andfireinsurance
Telephone and telegraph...
Rent, light, heat, and
power.
Printing and stationery
All other, including postage
and insurance on mail,
security and currency
shipments, repairs, and
alterations, etc
Total expenses of
operation
Federal reserve currency (original cost, including snipping
charges)
Miscellaneous charges, account
note issues
Taxes on Federal reserve bank
note circulation
Furniture and equipment . . .
Bank premises
Total expenses
.
1915
1916
1917
1918
1919
1920
$6,200
5,027
$50,000
42,225
$52,385
65,311
$63,761
120,907
$105,819
405,610
$158,083
881,142
$216,541
1,672,550
414
588
4,777
3,434
5,846
4,198
10,289
5,138
32,550
11,958
64,752
80,785
94,494
123,324
414
2,004
2,022
1,502
1,468
1,423
2,079
13,846
12,748
13,621
42,144
49,137
102,368
136,565
23,329
30,021
62
1,793
1,780
3,087
49,378
513
19,092
80,170
253
34,009
101,568
4,535
83,158
2,894
2,849
26,470
7,507
28,830
9,964
30,925
24,159
57,977
75,877
105,564
101,466
163,950
219,420
9 20,929
11,651
25,683
75,519
274,238
296,514
477,514
39,983
200,272
232,096
378,929 1,076,624 1,853,298
3,261,501
5,329
5,113
202,826
388,682
400,418
550,291
522
2,314
13,004
62,558
102,672
172,365
133,970
98,080
174,252
289,064
75,460
616,294 1,650,675 2,548,324
4,453,240
606
39,983
3,210
25,000
208,811
262,731
32,225
1
Total assessment for Federal Reserve Board expenses to Dec. 31,1915.
»Includes $16,641 expenses prior to Nov. 16,1914.
Current expenses of the Detroit branch of the Federal Reserve Bank of Chicago.
Bank officers
Clerical staff
Special officers and watchmen
All other
Directors' meetings, legal fees, officers' and clerks' traveling expenses, life
insurance andfidelitybond premiums
Taxes andfireinsurance
Telephone and telegraph
Rent, light, heat, and power
^
Printing and stationery
Furniture and equipment
All other, including postage and insurance on mail, security and currency
shipments, repairs and alterations, etc
Total current expenses.
i Branch opened for business Mar. 18,1918.
1918 1
1919
$11,250
21,334
4,446
1,089
$18,750
40,660
7,516
5,804
$26,966
178,707
13,563
14,807
4,707
231
2,427
6,610
2,278
4,102
190
3,819
9,153
3,882
6,079
12,123
1,375
14,666
14,718
26,767
44,881
1920
44,987
24,585
58,849
99,359
124,540
407,422
81
EXPENSES OF FEDERAL RESERVE BANKS.
EXHIBIT D, PART 8.
FEDERAL RESERVE BANK OF ST. LOUIS.
Comparison of salaries paid to officers of the Federal reserve bank as of Oct. 1, 1921, with
salaries paid to officers of three of the large national banks in St. Louis as of Sevt. 6
1921.
Annual salary.
Governor
Chairman and Federal reserve agent
Deputy governor
Counsel and secretary
Cashier
Auditor
Assistant Federal reserve agent
Assistant cashier
r>o
Do
Do
Do
Do
Manager Little Rock branch
Cashier Little Rock branch
Assistant cashier Little Rock branch
Manager Louisville branch
Cashier Louisville branch
Assistant cashier Louisville branch
Manager Memphis branch
Cashier Memphis branch
Assistant cashier Memphis branch
$25,000
18,000
12,000
;...
8,500
7;' 000
7 ? 000
7? 000
6,000
*.".".".".".".".".".*.". b, 400
4, 500
4,000
3, 750
3, 500.
6,000
45 000
3,000
7, 500
5,000
2, 750
75 500
5,000
3,300
•
Total
155,700
National banks in St. Louis.
Annual salary.
Position.
Bank A. Bank B. Bank C.
President
Executive manager
Do
ViceDo
president
-
$50 000 $45 000
40,000
35,000
20,000i
25,000
18,000)
25,000
18,0001 16,500
18 000f
12 ooTr
11,500
lG',000
10 000
15 000
M ooo
15 000
15,000
9,000,,
15 000
12 500
12,000
12,000
12,000
7,000
46,000
114,500
Do
Do
Do
Do
Do
Do
Do
Do
...
Do
Do
Do
Do
Other officers
Total
. .
457,000
198,000
$25 000
15,000
12,000
7,500
21,000
80,500
SUMMARY.
Annual salaries.
Number
of officers.
Federal reserve bank
Bank A
Bank B
Bank C
. . . .
.
S. Doc. 75, 67-1
-6
Total.
22 $155,700
37 457,000
18 198,000
8
80,500
Average.
$7,078
12,351
11,000
10,063
82
EXPENSES OF FEDERAL RESERVE BANKS.
Index of growth in number of officers and employees, in their aggregate salaries, and in
business of the bank.
[1915=1.]
Assets and liabili- Volume of business.
ties.
Personnel.
Year.
Officers and
employees.
Officers.
Earning
assets.
Number. Salaries. Number. Salaries.
1
1
3
4
4
5
1915
1916
1917
1918
1919
1920
1
1
2
2
2
3
1
1
5
10
14
22
Federal Discount
reserve and opennote
market
circulaoperation.
tions.
1
2
7
15
18
17
1
4
14
27
41
42
1
1
3
6
8
14
1
3
18
98
194
224
Gold
settlement
fund.
1
3
1C
17
3C
36
Number of officers and employees.
Dec. 31—
July 1,
1921.
1916
1915
Officers:
Chairman and Federal reserve agent
Governor
Deputy governor
Other officers
1918
1917
1920
1919
1
1
1
1
1
1
1
1
1
7
1
1
12
1
1
13
1
1
17
1
1
1
18
4
4
10
15
16
20
21
8
5
14
3
12
6
24
3
43
7
50
2
117
11
60
5
225
23
114
8
5
4
59
6
126
51
104
51
284
54
265
10
30
136
52
256
59
243
11
- 21
116
84
Total employees
35
49
167
370
525
831
790
Total officers and employees
39
53
177
38-5
541
861"
811
Average number of employees per officer
9
12
17
25
33
42
38
Total officers
Employees:
Banking department
Bookkeeping department
Transit department
Federal reserve agent's department
Auditing department
Fiscal agency department
General
Salaries of officers and employees.
Dec. 31—
Julyl,
1921.
1915
1916
1917
1918
1919
1920
$10,000
20,000
7,500
6,000
$10,000
20,000
7,500
6,000
$10,000
20,000
7,500
28,000
$10,000
20,000
9,000
46,500
$15,000
20,000
8,400
57,900
$16,000
20,000
10,800
83,400
$18,000
25,000
12,000
93,700
Total (bonus excluded)...
43,500
43,500
65,500
85,500
101,300
130,200
148,700
Employees:
Banking department
Bookkeeping department...
Transit department
Federal reserve agents' department
12,820
6,200
9,660
17,180
6,260
16,140
44,500
5,900
34,620
123,292
12,000
57,540
261,850
25,650
72,350
423,270
67,420
227,230
364,370
87,960
269,760
5,900
5,900
3,340
7,920
10,950
25,980
31,060
Officers:
Chairman and Federal reserve agent
Governor
Deputy governor
Other officers
83
EXPENSES OF FEDERAL RESERVE BANKS.
Salaries of officers and employees—Continued.
Dec. 31—
1915
1916
Employees—Continued.
Auditing department
Fiscal agency department...
General
12,820
Total (bonus excluded)...
Total officers and employees
Average salary payable to—
All officers
Officers other than Federal
reserve agent and chairman, governor and deputy governors
Employees
July 1,
1921.
1917
1918
1919
1920
12,820
f65,840
4,920
1132,620
47,000
$156,700
24,100
*48,560
163,380
53,380
$36,180
157,600
100,764
37,400
48,300
159,120
380,372
551,600 1,009,220
1,047,694
80,900
91,800
224,620
465,872
652,900 1,139,420
1,196,394
10,875
10,875
6,550
5,700
6,331
6,510
7,081
6,000
1,068
6,000
985
4,000
953
3,875
1,028
4,454
1,051
4,906
1,214
5,206
1,326
Extra compensation paid by the Federal Reserve Bank of St.
1917-1921.
[Salaries shown are annual salaries.
Louis for the years
Per cent of extra compensation based on actual salary received during
period.]
Per
cent.
15
10
Jan. 1 to Dec. 31, 1917:
Up to $1,500
$1,501 to $6,000
Jan. 1 to Dec. 31,1918:
Up to $1,500
$1,501 to $3,000
$3,001 to $5,000
20
15
10
Jan. 1 to Dec. 31, 1919:
Up to $1,500
$1,501 to $3,000
$3,001 to $5,000
Jan. 1 to Dec. 31, 1920:
Up to $1,500
$1,501 to $3,000
$3,001 to $5,000
,
Per
cent.
20
15
10
20
15
10
Principal asset and liability items at end of year.
Total cash
reserves.
1915
1916
1917
1918
1919
1920
.
..
Bills discounted.
Bills bought.
$18,108,000
28,730,000
59,136,000
89,257,000
96,928,000
88,876,000
$1,255,000
1,301,000
34,027,000
70,703,000
77,680,000
114,932,000
$661,000
7,037,000
7,363,000
7,293,000
32,804,000
1,200,000
$3,178,000
12,008,000
45,067,000
85,717,000
128,875,000
133,308,000
5
92
2
42
I n d e x of growth 1915-1920 (1915=1)
Gross deposits.
Federal reserve
notes in circulation.
$2,781,000
2,800,000
3,475,000
4,601,000
7,788,000
12,711,000
$14,105,000
45,855,000
97,677,000
103,251,000
131,964,000
104,269,000
$8,133,000
16,459,000
59,923,000
120,037,000
145,298,000
135,785,000
5
7
17
Capital and
surplus.
1915
1916
1917
1918..
1919
1920
. . . .
.
I n d e x of growth 1915-1920 (1915—1)
. .
.
..
Total earning
assets.
84
EXPENSES OF FEDERAL RESERVE BANKS.
Volume of business transacted during the year.
1915
1916
1917
1918
1919
1920
.
.
.
.
Total discount
and open
market
operations.
BiUs bought.
United States
securities
bought.
$6,317,000
8,843,000
181,118,000
1,085,137,000
2,100,631,000
2,438,041,000
$1,801,000
20,681,000
22,788,000
26,096,000
87,503,000
36,019,000
$970,000
2,419,000
i 650,000
6,568,000
18,788,000
74,488,000
$11,353,000
35,562,000
205,574; 000
1,117,801,000
2,206,922,000
2,548,548,000
386
20
77
224
Bills
discounted.
I n d e x of g r o w t h 1915-1920 (1915=1)
Currency
Federal reserve Federal reserve received
from
notes issued notes redeemed member and
by agent.
by agent.
other banks.
1915
1916
1917
1918
1919
1920
2 $9,197,000
11,811,000
55,260,000
102,605,000
134,025,000
106,470,000
a $247,000
3,871,000
10,287,000
35,348,000
98,426,000
115,798,000
12
469
I n d e x of g r o w t h 1915-1920 ( 1 9 1 5 - D
Currency
paid out to
member and
other banks.
$288,738,000
443,427,000
$205,447,000
370,335,000
N u m b e r of
Amount of
checks cleared. checks cleared.
Transactions
through gold
settlement
fund.
3
1915
1916
1917
1918
1919
1920
2,648,000
6,105,000
19,414,000
31,691,000
$1,20(5,631,000
1, 799,306,000
6,110,660,000
7,644,600,000
$360,325,000
1,124,901,000
3,620,747,000
6,109,256,000
10, 847,104,000
13,094,883,000
I n d e x of g r o w t h 1915-1920 (1915—1)
36
1
Exclusive of certificates of indebtedness,
a Nov. 16, 1914, to Dec. 31, 1915.
Represents daily average for the period May 20, 1915 (date of first settlement), to Dec. 31, 1915, multiplied by 365.
8
Expenses of the Federal Reserve Bank of St. Louis.
Nov. 16
to Dec.
31, 1914.
1915
1916
1917
Expenses of operation:
Salaries$51, 858
$46,699
$6,687
$49,413
Bank officers
4,056
35,164
37,264
71,104
Clerical staff
Special officers and
148
1,650
1,620
2,127
watchmen
158
1,200
1,185
2,095
All other
Federal advisory council,
governors' and Federal
1,503
1,998
1,116
reserve agents' conferences
Directors' meetings, legal
fees, officers' and clerks'
traveling expenses, life
insurance and fidelity
9,352
2,006
9,767
12,493
bond premiums
Assessments for Federal
1
15,426
12, 733
9,750
Reserve Board expenses
Taxes and fire insurance..
1,430
1,132
75
1,831
Telephone and telegraph
1
Total assessment for Federal Reserve Board expenses to Dec. 31,1915.
1918
1919
$72, 573
206,763
$95,040
400,860
$126,916
747,312
7,218
5,212
13,408
20,289
22,984
30,693
1,134
1,932
1,759
21,737
53,541
65,986
18,397
24,981
701
19,157
26,618
3,220
51,429
7,098
1920
85
EXPENSES OF FEDERAL RESERVE BANKS.
Expenses of the Federal Reserve Bank of St. Louis—Continued.
Nov. 16
to Dec.
31, 1914.
Expenses of operation—Contd.
Rent, light, heat and power.
Printing and stationery
All other, including postage
and insurance on mail,
security and currency
shipments, repairs and alterations, etc
Total expenses of operation
Federal Reserve currency (original cost including shipping
charges)
Miscellaneous charges, account
note issues
Taxes on Federal reserve bank
note circulation
Furniture and equipment....
Bank premises
Total expenses
1
1915
1916
1917
1918
1919
$16,725
4,833
$14,900
5,278
$19,640
4,945
$25,739
25,386
$37,965
34,676
$55,885
76,743
7,026
6,621
12,007
35,133
80,789
131,215
209,770
25,720
146,162
141,200
212,630
472,046
833,765
1,419,315
12,120
10,720
49,363
147,347
188,617
238,051
1,656
1,229
4,597
20,313
32,988
102, 031
58,300
73,798
58,000
176,102
726,021 1,174,793
1,924,453
$1, 784
3,780
1
25,720
158,282
3,355
7,728
156,931
270,950
1920
Includes $5,854 expenses prior to Nov. 16, 1914.
Current expenses of the Little Rock branch of the Federal Reserve Bank of St. Louis.
Salaries:
Bank officers
Clerical staff
,
Special officers and watchmen
All other
Directors' meetings, legal Tees, officers' and clerks' traveling expenses, life-insurance
and fidelity-bond premiums
Taxes and fire insurance.
Telephone and telegraph
Rent, light, heat, and power
Printing and stationery
Furniture and equipment
All other, including postage and insurance on mail, security arid currency shipments,
repairs and alterations, etc
Total current expenses.
1
19191
1920
$10,719
29,256
2,022
2,493
$10,796
65,858
3,324
3,915
5,200
145
1,469
3,721
6,674
23,488
6,178
263
7,420
4,648
11,051
19,510
13,776
24,497
98,963
157,460
Branch opened for business Jan. 0, 1919.
Current expenses of the Louisville branch of the Federal Reserve Bank of St. Louis.
Salaries:
Bank officers
Clerical staff
Special officers and watchmen
All other
Directors' meetings, legal fees, officers' and clerks' traveling expenses, lifeinsurance and fidelity-bond premiums
Taxes and fire insurance
Telephone and telegraph
Rent, light, heat, and power
Printing and stationery
Furniture and equipment
All other, including postage and insurance on mail, security and currency
shipments, repairs and alterations, etc
Total current expenses..
1
Branch opened for business Dec. 3, 1917.
1918 i
1919
1920
$8,190
16,151
$9,960
40,482
1,316
1,379
$14,125
82,307
3,279
3,498
1,333
5,292
168
2,101
2,599
3,728
5,691
8,365
2,335
7,104
4,297
11,310
22,178
1,383
2,109
2,727
11,628
9,692
19,991
28,553
53,799
92,707
187,351
86
EXPENSES OF FEDERAL RESERVE BANKS.
Current expenses of the Memphis branch of the Federal Reserve Bank of St. Louis.
19181
•Salaries:
Bank officers
Clerical staff
Special officers and watchmen
All other
Directors' meetings, legal fees, officers' and clerks'traveling expenses, lifeinsurance andfidelity-bondpremiums
Taxes and fire insurance
Telephone and telegraph
.-.
Rent, light, heat, and power
Printing and stationery
Furniture and equipment
All other, including postage and insurance on mail, security and currency
shipments, repairs and alterations, etc
Total current expenses..
1
1919
1920
$2,983
13,337
772
496
$11,687
57,882
3,441
3,642
$14,025
102,683
4,423
6,854
1,093
7,166
184
2,413
8,453
7,441
11,534
9,118
225
8,645
13,689
11,564
52,975
216
1,964
4,681
7,380
14,562
23,062
51,374
47,484
136,905
275,575
Branch opened for business Sept. 3, 1918.
EXHIBIT D, PART 9.
FEDERAL RESERVE BANK OF MINNEAPOLIS.
Comparison of salaries paid to officers of the Federal reserve bank as of Oct. 1, 1921, with
salaries paid to officers of three of the large national banks in Minneapolis as of Sept. 6,
1921.
Annual salary.
Governor
'
$16,000
Chairman and Federal reserve agent
15, 000
Deputy governor
13, 000
Do
6, 000
Assistant Federal reserve agent
6, 000
Controller
."
6,000
Cashier
5, 000
Assistant cashier
•
4,800
Assistant Federal reserve agent
4, 500
Assistant cashier
4, 000
Do
3,250
Do
3, 000
Manager, Helena branch
6, 000
Cashier, Helena branch
4,000
Assistant Federal reserve agent, Helena branch
3, 600
Assistant cashier, Helena branch
3, 500
Total
103,650
N
National banks in Minneapolis.
Annual salary.
Position.
Bank A. BankB. Bank C.
Chairman executive committee
Chairman board of directors
President..
Vice president
Do
Do
Do
Do
Do
Do
Do . . .
Do
Other officers
Total
.
$25,000
25,000
40,000
19,000
17,000
16,000
13,000
10,500
10,500
9,000
6,800
2,000
35,000
228, 800
$45,000
25,000
21,500
16,000
16,000
13,000
$21,000
16,000
6,500
60,700
29,700
197, 200
73,200
OF FEDERAL HESEUVE
National bank in Minneapolis—Continued.
SUMMARY.
Annual salaries.
Number
of officers.
Federal reserve bank
Bank A
BankB
BankC.
Total.
Average.
16 $103,650
18 228, 800
18 197,200
11
73,200
$6,478
12,711
10,955
6,654
Index of growth in number of officers and employees in their aggregate salaries, and in
business of the bank.
[1915=1.]
Assets and
liabilities.
Personnel.
Year.
1915
1916
1917
1918
1919
1920
Volume of business.
Officers and
employees.
Federal Discount
open- Gold setEarning reserve and
tlement
note
cir- market
assets. culation.
operafund.
Number. Salaries. Number. Salaries.
tions.
Officers.
1
1
2
2
2
3
1
1
2
3
2
3
1
3
6
13
14
23
1
2
3
5
7
13
1
3
6
15
24
23
1
1
4
7
7
6
1
3
9
52
84
107
1919
1920
1
6
37
78
103
111
Number of officers and employees.
Dec. 31—
1915
Officers:
Chairman and Federal reserve agent
Governor
Deputy governor... .
. . . .
Other officers
Total officers
Employees:
Banking department
Bookkeeping department.
Transit department
*
Federal reserve agents' department
Auditing department
Fiscal agency department
General
Total employees
Total officers and employees
. . .
Average number of employees per officer
1
1
.
1916
1917
1
1
1
1
1918
.
1
1
1
5
1
1
1
1
1
2
July 1,
1921.
1
1
2
1
1
3
4
6
9
3
3
5
8
7
10
13
10
3
1
3
14
6
29
2
30
6
37
2
71
12
78
3
38
13
101
14
128
13
192
18
11
47
95
64
87
168
20
181
19
13
65
27
17
51
122
259
280
449
493
20
54
17
127
24
267
32
287
40
459
45
506
38
6
OF FEDERAL RESERVE BAKKS.
Salaries of officers and employees.
Dec. 31—
July 1,
1921.
1917
1918
1919
1920
$12,000
12,000
7,500
10,400
$15,000
16,000
117,500
23,900
$15,000
16,000
118,000
39,550
1915
1916
Officers:
Chairman and Federal reserve agent
Governor
Deputy governors
,
Other officers
$7,500
15,000
$9,000
15,000
$10,000
18,000
3,000
3,500
12,500
$10,000
18,000
6,000
16,210
Total (bonus excluded)...
25,500
27,500
40,500
50,210
41,900
72,400
88,550
11,940
2,460
2,000
15,850
5,540
19,460
29,120
6,040
24,040
56,629
6,078
33,243
104,380
14,560
85,860
166,880
18,600
202,836
207,308
28,244
199,408
5,520
4,080
4,580
28,300
46,860
20,900
91,336
40,724
Employees:
Banking department
Bookkeeping department...
Transit department
Federal reserve agent's department
Auditing department
Fiscal agency department..
General
Total (bonus excluded)...
Total officers and employees:
Average salary payable to:
All officers
Officers other than chairman and Federal reserve
agent, governor, and
deputy governors
Employees
1
51,180
65,721
72,360
40,320
16,020
121,816
21,920
44,939
114,960
167,307
305,460
566,472
634,780
47," 420
72,430
155,460
217, 517
347,360
638, 872
723,330
8,500
9,166
8,100
6,275
5,986
7,240
&,812
3,000
1,289
3,500
4,167
942
3,242
646
2,600
1,091
3,983
1,262
4,394
1,288
Two deputy governors.
Extra compensation paid by the Federal Reserve Bank of Minneapolis for the years 19191921.
[Salaries shown are annual salaries. Per cent of extra compensation based on actual salary received during
period.]
Jan. 1 to Dec. 31, 1919:
Up to $1,500
$1,501 to $3,000
$3,001 to $5,000
Jan. 1 to Dec. 31, 1920:
Up to $1,500
$1,501 to $3,000
$3,001 to $6,000
Jan. 1 to June 30, 1921: .
Up to $1,500
$1,501 to $6,000
Per cent.
20
15
10
25
20
15
15
10
Principal asset and liability items at end of year.
Total cash
reserves.
1915
1916
1917
1918
1919
1920
. . .
Index ol growth 1915-1920 (1915=1)
Bills discounted.
Bills bought.
Total earning
assets.
$21,104,000
36,503,000
70,748,000
93,220,000
52,811,000
46,928,000
$1,299,000
1,985,000
14,031,000
36,672,000
73,857,000
81,654,000
$478,000
6,200,000
7,167,000
17,994,000
12,599,000
1,313,000
$3,942,000
11,896,000
24,451,000
59,933,000
95,052,000
91,563,000
2
63
3
23
89
EXPENSES OF FEDERAL RESERVE BANKS.
Principal asset and liability items at end of year—Continued.
1915
1916
1917
1918 .
1919
1920
.
Federal reserve
notes in circulation.
Gross
deposits.
Capital and
surplus.
$2,547,000
2,609,000
2,658,000
3,657,000
6,643,000
10,441,000
$13,867,000
34,716,000
59,946,000
61,384,000
70,865,000
63,100,000
$13,182,000
18,296,000
49,414,000
96,571,000
87,187,000
79,498,000
4
5
6
Index of growth 1915-1920 (1315-1)
Volume of busiyiess transacted during the year.
Bills
discounted.
1915
1916
1917
1918
1919
1920
.
.
.
Index of growth 1915-1920 (1915=1)
United States
securities
bought.
Bills
bought.
$5,207,000
6,474,000
80,155,000
433,793,000
661,521,000
953,392,000
$1,455,000
13,539,000
16,397,000
13,902,000
108,714,000
18,059,000
$1,329,000
2,553,000
1616,000
96,090,000
102,215,000
141,696,000
$10,387,000
26,301,000
97,345,000
543,785,000
872,450,000
1,113,147,000
183
12
107
107
Currency
Federal reserve Federal reserve received
notes issued
notes redeemed member from
and
by agent.
by agent.
other banks.
1915
1916
1917
1918
1919
1920
Index of growth 1915-1920 (1915=1)....
2
$14,002,000
9,880,000
42,230,000
57,140,000
39,990,000
39,450,000
2
$2,000
3,398,000
11,708,000
9,422,000
50,272,000
46,507,000
3
23,254
Number
of checks
cleared.
1915
1916
1917
1918
1919
1920
Index oi growth 1915-1920 (1915= 1)
1
Total discount
and openmarket
operations.
Currency paid
out to
member and
other banks.
$57,347,000
64,8JO, 000
Amount
of checks
cleared.
$52,8 2 J, 00 J
78, 995,000
Transactions
through gold
settlement fund
3
c
4,3S y, 000
6,048,000
10,748,000
21,589,000
$1,097,635,000
2,112,894,000
2,770,009,000
3,908,858,000
$39,789,003
238,091,000
1,476,679,000
3,114,805,000
4,083,210,000
4,413,640,000
111
Exclusive of certificates of indebtedness.
a Nov. 16, 1914, to Dec. 31, 1915.
s Represents daily average for the period May 20,1915 (date of first settlement) to Dec. 31,1915, multiplied
EXPENSES OF FEDERAL RESERVE BAlSTKS.
Expenses of the Federal Reserve Bank of
Nov. 16
to Pec.
31, 1914.
Expenses of operation:
SalariesBank officers
Clerical staff
Special officers and
watchmen
All other
Federal advisory council,
governors' and Federal
reserve agents' conferences
Directors' meetings, legal
foes, officers' and clerks'
traveling expenses, lifeinsurance and fidelitybond premiums
Assessments for Federal
Reserve Board expenses..
Telephone and telegraph
Rent, light, heat,and power.
Printing and stationery
All other, including postage
and insurance on mail,
security and currency
shipments, repairs and
alterations, etc
Total expenses of
operation
Federal reserve currency (.original cost including shipping
$3,419
1,182
1915
1916
1917
1918
1919
$27,542
20,745
$26,625
29,277
$37,101
55,725
$49.125
123,402
$61.014
208^ 171
$77,637
363,724
1,311
78
1,667
816
120
8,726
3,530
10,766
23,686
2,552
888
1,608
1,698
1,372
197
53
1,799
329
1920
2,089
9,045
9,952
10,773
17,512
24, 418
47,285
113,286
8,962
119
780
901
817
5,068
3,808
867
6,955
f,198
10,196
134
1,778
8,660
11,596
14,117
167
•5,406
11,298
IS, 361
20,209
851
4,975
14,295
25,228
22,520
1,186
16,612
21,760
62,488
14,874
4,751
12,578
27,128
67,794
61,263
149,967
24,852
88,900
105,355
166,462
308,910
434,378
799,003
18,701
9,S66
42,381
114,287
56,273
62,627
1,355
10,734
17,002
15,959
36,792
100,817
1,015,198
2,998
2
Miscellaneous charges, account
Taxes on Federal reserve bank
5,353
44,464
59,977
24,912
23,926
120,574
254,662
493,908
556, 4.91
r
Fu niture and equipment. .
Bank premises
Total expenses
Minneapolis,
24,852
107,601
1
Total assessment for Federal Reserve Board expenses to Dec. 31, 1915.
2 Includes $13,205 expenses prior to Nov. 16, 1914.
EXHIBIT D, PART 10.
FEDERAL RESERVE BANK OP KANSAS CITY.
Comparison of salaries paid to officers of the Federal reserve bank as of Oct. 1, 1921, with
salaries paid to officers of three large national banks in Kansas City as of Sept. 6,1921.
Governor
Chairman and Federal reserve agent
Deputy governor
Cashier
Auditor
Assistant Federal reserve agent and secretary
Assistant cashier
.*
Do
Do
Do
Assistant auditor
Assistant cashier
'
Do
Do
Assistant auditor
Manager Omaha branch
Cashier Omaha branch
;
Annual salary.
$20,000
15, 000
12, 000
8, 000
7, 200
6, 600
6, 300
5,400
4, 800
4, 800
4,500
4, 200
4,000
4, 000
3, 600
7,500
5,400
91
EXPENSES OF FEDERAL RESERVE BANKS.
Annual salary.
Assistant cashier Omaha branch
Do
Do
Manager Denver branch
Cashier Denver branch
Assistant cashier Denver branch
Assistant Federal reserve agent Denver branch
Manager Oklahoma City branch.
Cashier Oklahoma City branch
$3, 720
3, 600
3,300
7, 500
4, 000
3, 300
2, 400
5, 400
3, 300
Total
159,820
National banks in Kansas City.
Annual salary.
Position.
Bank A.
President
Vice president
Do
Do
Do
Do
Other officer^
• .
. . . . . . . .
Bank B .
$25,000
326,000
15,000
15,000
15,000
7,500
10,000
7,500
10,000
10,000
16,600™ " 17,800
. . .
Totai
101,600
73,800
Bank C.
$25,000
15.000
5,500
16,300
61,800
SUMMARY.
Number
Annual salaries.
Ol
officers.
Bank A.
Bank B
Bank C
26
9
8
6
.
Total.
$159,820
101,600
73,800
61,800
Average.
#6,147
11,289
9,225
10,300
Index of growth in number of officers and employee?, in their aggregate salaries, and in
business of the bank.
[1915=1.1
Assets a n d liabilities.
Personnel.
Year.
Officers and employees.
Officers.
Earning
assets.
Number. Salaries. N u m b e r . Salaries.
1915
1916
1917
1918
1919
1920
1
1
2
5
6
7
1
1
2
4
4
5
1
1
4
12
15
22
1
1
3
10
14
20
1
2
7
13
21
21
Volume of business.
Federal Discount
reserve and open- Gold settlement
note cir- market
operafund.
culation.
tions.
1
2
5
11
10
11
1
2
16
53
100
113
1
5
17
32
50
70
92
EXPENSES OF FEDERAL RESERVE BANKS.
Number of officers and employees.
Dec. 31—
1915
Officers:
Chairman and Federal reserve agent
Governor
Deputy governor
Other officers.
Total employees
Total officers and employees
Average number of employees per officer
1917
1
1
1
1918
1919
1
1
1
11
1920
1
2
1
1
1
3
15
1
1
1
19
3
4
6
14
17
22
24
6
16
3
4
26
3
4
26
5
16
139
5
18
199
6
12
15
85
27
201
105
157
186
33
315
13
33
206
241
36
333
15
44
171
274
37
48
147
466
566
841
873
40
12
52
12
153
24
480
33
583
33
863
38
897
36
Total officers
Employees:
Bookkeeping department
Transit department
Federal-reserve agent's department
Auditing departmentFiscal agency department
General
July 1,
1921.
»16
1
1
1
1
1
21
Salaries oj officers and employees.
Dec. 31—
Officers:
Chairman and Federal reserve agent
Governor
Deputy governor
Other officers.
1915
1916
1917
1918
87,500
7,500
$7,500
10,000
July 1,
1921.
1919
1920
$9,000
15,000
9,000
51,000
$12,000
18,000
64,400
$15, 000
20,000
10,000
68,473
$15,000
20,000
12,000
103,820
94,400
113,473
150, 820
206,160
44,321
330,153
58,560
415,540
6,000
8,800
$7,500
12,500
6,000
11,400
Total (bonus excluded)...
Employees:
Bookkeeping department...
Transit department
Federal reserve agent department
Auditing department
Fiscal agency department..
General
21,000
26,300
37,400
84,000
6,120
10,980
4,500
18,780
5,340
22,960
20,180
108,360
4,C80
4,380
5,760
9,100
13,460
18,460
93,190
27,020
219,810
122,880
194, 890
239,060
28,140
46,442
277,140
290> 318
35,280
81, 080
254,580
413,440
Total (bonus excluded)...
Total officers and employees
Average salary payable to—
All officers
Officers other than chairman
and Federal reserve agent,
governor, and deputy
governor
Employees
34,640
46,120
156,190
476,990
676,070 1,016,514
1,258,480
55,640
72,420
193,590
560,990
770,470 1,129,987
1,409,300
7,000
6,575
6,233
6,000
5,553
5,158
6,284
6,000
4,400
961
3,800
1,C63
4,636
1,024
4.293
1', 194
3,604
1,209
4,944
1,442
Extra compensation paid by the Federal Reserve Bank oj Kansas City for the years 19171921.
[Salaries shown are annual salaries. Per cent of extra compensation based on actual salary received during
period.]
Per cent.
Percent. Jan. 1 to Dec. 31, 1920:
Jan. 1 to Dec. 31, 1917:
20
Up to $1,500
Up to $6,000
10
15
$1,501 to $3,000....
Jan. 1 to Dec. 31, 1918:
$3,001 to $5,000....
10
20
Up to $1,500
15 Jan. 1 to June 30, 1921:
$1,501 to $3,000
Up to $1,500
10
16.
$3,001 to $5,000
$1,501 to $3,000....
12
Jan. 1 to Dec. 31, 1919:
20
$3,001 to $5,000....
Up to $1,500
15
$1,501 to $3,000
10
$3,001 to $5,000
93
EXPENSES OF FEDERAL RESERVE BANKS.
Principal asset and liability items at end of year.
Total cash
reserves.
1915
1916
1917
1918
1919
1920
....
.
.
.
Bills discounted.
Bills bought.
$20,071,000
47,391,000
84,189,000
81,858,000
76, 576,000
76,497,000
$3,581,000
515,000
35,055,000
57,454,000
93,380,000
110,341,000
$429,000
3,945,000
1,338,000
14, 203,000
18,692,000
2,171,000
$6,418,000
14,080,000
47,026,000
84,901,000
136,007,000
134,201,000
4
31
5
21
Index of growth, 1915-1920 ( 1 9 1 5 = 1 ) . . . .
Federal reserve
Gross deposits. notes in circulation.
Capital and
surplus.
1915..
1916
1917..
1918
1919
1920
Tndex of growth, 1915-1920 (1915=1)
Total earning
assets.
f
$3,038,000
3,074,000
3,397,000
4, 870,000
10,132, 000
13,614,000
$14,788,000
54,808,000
92,458,000
102,680,000
163,678,000
127, 536,000
$10,478,000
21,735,000
55,373,000
112,445,000
104,089,000
111,578,000
4
9
11
Volume of business transacted during the year.
1915
1916
1917
1918
1919
1920
.
.
United States
securities
bought.
$10,875,000
6,817,000
237,691,000
833, 521, 000
1, 555, 597, 000
1,667,943,000
$1,788,000
8,191,000
17, 561,000
14,690,000
26,086,000
17,174,000
$2,152,000
8, 362,000
1,187,000
11,131,000
31, 792,000
128,079,000
$16,065,000
25,367,000
256,870,000
859,342,000
1,613,475,000
1,813,196,000
153
10
60
113
Index of growth, 1915-1920 (1915=1)
Federal reserve
notes redeemed by
agent.
Currency received from
member a n d
other banks.
2 $11,330,000
16,090,000
56,008, 000
79,900,000
57,900,000
72, 570,000
2 $330,000
4,855,000
20, 360,000
17,466,000
67,662,000
65,000,000
$133,234,000
184,098,000
6
197
Index of growth, 1915-1920 (1915=1)..
1915
1916
1917
1918
1919
1920
1
Federal reserve
notes issued
by agent.
1915
1916
1917
1918
1919
1920
Total discount
and
open-market
operations.
Bills bought.
Bills discounted.
Number
of checks
cleared.
Amount
of checks
cleared.
4,559,000
12,055,000
30, 801,000
54, 755, 000
$3, 537, 781, 000
7, 552, 840,000
10,112,923,000
12,669,535,000
Currency paid
out to member and
other banks.
$103,168,000
165,849,000
Transactions
throug'i gold
settlement
fund.
3
.
..
.
.
Index of growth, 1915-1920 (1915=1)...1
$147,960,000
676,433,000
2,574, 700,000
4,699,478,000
7, 387,308,000
10,429,318,000
70
Exclusive of certificates of indebtedness.
2 Nov. 16, 1914, to Dec. 31, 1915.
Represents daily average for the period May 20,1915 (date of first settlement), to Dec. 31, 1915, multiplied by 365.
8
94
EXPENSES OF FEDERAL RESERVE BANKS.
Expenses of the Federal Reserve Bank of Kansas City.
Nov. 16
to Dec.
1915
1916
1917
$3,321
3,234
$25,500
31,681
$25,973
40,223
$37,782
67,404
$68,045
188 680
$91,604
453 258
$116,274
794 286
135
138
2,319
805
1,599
1,419
1 068
5,609
784
14,423
11 698
25 275
35 694
256
1,742
1,974
1,035
1,028
1,159
1,077
1918
1919
1920
31,1914.
Expenses of operation:
Salaries—
• Bank officers
Clerical staff.
Special officers and
watchmen
All other
Federal advisory council,
governors' and Federal
reserve agents' conferences.
Directors' meetings, legal
fees, officers' and clerks'
traveling expenses, lifeinsurance and fidelitybond premiums
Assessments for Federal Reserve Board expenses
Taxes and fire insurance
Telephone and telegraph...
Rent, light, heat, and power.
Printing and stationery
All other, including postage
• and insurance on mail,
security and currency
shipments, repairs and
alterations, etc
Total expenses of operation
Federal reserve currency (original cost, including shipping
charges)..
Miscellaneous charges, account
note issues
Taxes on Federal reserve bank
note circulation..
Furniture and equipment
Bank premises
Total expenses
2,056
13,773
12,257
16,202
28,144
54,865
79,367
15,808
10,575
13,118
283
1,294
1,451
896
9,486
7,721
858
9,618
4,361
1,401
11,939
10,447
17,998
169
6,936
23,786
25,370
28 151
646
15,967
36,366
49,782
34 221
4 217
42,937
47,046
94,787
15,996
13,355
16,399
45,987
120,410
160,701
238,935
28 164
122,281
124 642
207 802
486 959
918 620
1 514 116
13,805
20,436
91,187
98,542
131 339
97 477
20,886
57,017
16,493
33,905
46 710
65,327
54 290
83 422
126 707
2,333
689,228 1,186,069
1,857,960
1
2
28,164
5 000
5,791
4,350
40,794
141,086
155,219
360,669
1
Total assessment for Federal Reserve Board expenses to Dec. 31, 1915.
includes $14,612 expenses prior to Nov. 16, 1914.
Current expenses of the Denver branch of the Federal Reserve Bank of Kansas
Salaries:
Bank officers
Clerical staff
Special officers and watchmen
Allother
Directors' meetings, legal fees, officers' and clerks' traveling expenses, li einsurance and fidelity-bond premiums
Taxes and fire insurance
Telephone and telegraph
Rent, light, heat, and power
Printing and stationery
Furniture and equipment
All other, including postage and insurance on mail, security and currency
shipments, repairs and alterations, etc
Total current expenses..
1
Branch opened for business Jan 14, 1918.
City.
1918 1
1919
1920
16,671
20,766
2,236
$9,135
53,546
3,283
1,323
$12,282
93,560
5,370
3,147
3,914
77
810
2,700
4,825
11,430
6,726
83
1,266
4,800
7,132
8,238
1,642
233
2,335
5,592
12,618
8,719
11,633
23,024
27,043
65,062
118,556
180,541
95
EXPENSES OF FEDERAL RESERVE BANKS.
Current expenses of the Oklahoma City branch of the Federal Reserve Bank of Kamas City,
1920.l
Salaries:
Bank officers
$5, 077
Clerical staff
52, 048
Special officers and watchmen
388
A11 other
2, 931
Directors' meetings, legal fees, officers' and clerks' traveling expenses, life
insurance, and fidelity bond premiums
9> 907
Taxes and fire insurance
242
Telephone and telegraph
4, 712
Rent, light, heat, and power
3, 050
Printing and stationery
9, 361
Furniture and equipment
52, 487
All other, including postage and insurance on mail, security and currency
shipments, repairs, and alterations, etc
16, 330
Total current expenses
1
156, 533
Branch opened for business Aug. 2, 1920.
Current expenses of the Omaha Branch of the Federal Reserve Bank of Kansas City.
Salaries;
Bank officers.
Clerical staff
Special officers and watchmen
Allother
Directors' meetings, legal fees, officers' and clerks' traveling
expenses, life insurance andfidelitybond premiums
Taxes and. fire insurance
Telephone and telegraph
Rent, light, heat, and power
Printing and stationery
•
Furniture and equipment
Bank premises
All other, including postage and insurance on mail, security an J.
currency shipments, repairs and alterations, etc
Total current expenses.
19171
1918
$2,567
4,395
260
233
$9, 800
25,088
814
3,294
$13, 781
83, 756
3,559
2,577
$16,333
179,452
6,257
8,221
3,183
92
1,036
9,545
284
1,
10, 084
12,925
17,698
14,973
2,979
9,747
4,549
21,312
28,267
683
190
2,001
1,054
104
1919
1920
3,955
13,004
29,444
53, 702
15,443 I
78,847
182, 468
345,792
i Branch opened for business Sept. 4,1917.
EXHIBIT D, PART 11.
FEDERAL RESERVE BANK OF DALLAS.
Comparison of salaries paid to officers of the Federal reserve bank as of Oct. 1, 1921, with
salaries paid to officers of three of the large national banks in Dallas as of Sept. 6,1921.
Governor
Chairman and Federal reserve agent
Acting d e p u t y governor
Cashier
Assistant Federal reserve agent
Assistant cashier
'.
General auditor
Assistant cashier
Legal counsel
Assistant cashier
Do
Assistant general auditor
Assistant cashier
Do
Do
Legal counsel
r
Annual salary.
$18, 000
18, 000
7, 500
9,000
6, 000
6^ 000
5, 000
4, 500
4, 200
4, 200
4, 200
3, 600
3, 600
3, 600
3, 300
1,, 2QQ
96
EXPENSES OF FEDERAL RESERVE BANKS.
Annual salary.
Manager, El Paso branch
Cashier, El Paso branch
Assistant cashier, El Paso branch
Assistant Federal reserve agent and auditor, El Paso branch —
Manager, Houston branch
Cashier, Houston branch
Assistant cashier, Houston branch
Assistant Federal reserve agent and auditor, Houston branch
$6, 000
3, 600
2,400
2, 700
6,000
4,000
2, 400
3, 300
Total
132, 300
National banks in Dallas.
Annual salary.
Position.
Bank A. B a n k B . Bank C.
Chairman
President
Vice president
Do
Do
Do
Do .
. .
Do
Do.
Other officers
Total
.
* ..
.
. .
.
.
.
.
.
,
$6,000
20,000
12,500
10,000
9,000
$15,000
25,000
15,000
15,000
12,500
6,000
6,000
6,000
52,800
$25,000
12,500
7,000
7,000
6,000
6,000
40,000
27,600
153, 300
103, 500
85,100
SUMMARY.
Number
of
officers.
Federal reserve bank..
Bank A
BankB.
BankC.
.
.
24
16
14
9
.
Annual salaries.
Total.
$132,300
153,300
103,500
85,100
Average.
$5,512
9,581
7,393
9,456
Index of growth in number of officers and employees, in their aggregate salaries, and in
business of the bank.
[1915=1.]
Assets and
liabilities.
Personnel.
Year.
Officers and
employees.
Officers.
Number. Salaries. Number.
1915
1916
1917
1918
1919
1920
1
1
2
3
4
5
Volume of business.
1
1
1
2
3
4
1
2
5
13
16
20
Federal Discount
Gold
open- settleEarning reserve and
assets. note cir- market
ment
operaculation. tions.
fund.
Salaries.
1
1
3
8
10
13
1
1
5
10
13
14
1
2
3
4
5
5
1
1
2
23
45
53
1
3
12
20
44
63
97
EXPENSES OF FEDERAL RESERVE BANKS.
Number of officers and employees.
Dec. 31—
July l,
1921.
1915
Officers:
Chairman and Federal reserve agent
Governor
. . .
Deputy governor
Other officers
Total employees
Total officers and employees
Average number of employees per officer
1917
1919
1918
1920
1
1
1
1
1
1
1
2
1
1
1
3
1
1
1
7
1
1
1
14
1
1
1
16
21
4
5
6
10
17
19
23
11
2
2
2
12
5
27
2
31
7
39
2
113
13
86
5
165
23
173
16
10
12
75
10
162
14
89
22
120
32
189
20
36
78
119
124
27
168
21
34
58
200
27
58
164
393
488
594
632
31
7
63
12
170
27
403
39
505
29
613
31
655
27
Total officers
Employees:
Banking department
Bookkeeping department.
Transit department
Federal reserve agent's department
Auditing department .
Fiscal agency department
General
1916
1
1
Salaries of officers and employees.
Dec. 31—
Officers:
Chairman and Federal
reserve agent...
Governor
Deputy governor.
Other officers
Total (bonus excluded)...
Employees:
Banking department
Bookkeeping department...
Transit department
Federal reserve agent's department
Auditing department
Fiscal agency department..
General
Total (bonus excluded)...
Total officers and employees
Average salary payable to—
All officers
Officers other than chairman and Federal reserve
agent, governor, and deputy governor
Employees
July 1,
1921.
1915
1916
$7,500
10,000
6,000
5,000
$9,000
10,000
6,000
9,000
28.500
1917
1918
1919
$10,000
12,000
7,500
12,200
$10,000
12,000
8,400
29,800
$14,000
15,000
10,000
52,800
$18,000
18,000
12,000
64,000
$18,000
18,000
34,000 I
41,700
60,200
91,800
112,000
124,800
17,140
1,620
2,100
17,760
5,100
20, 760
39,300
6,360
33,140
136,200
12,840
74,400
202,460
24,780
178,000
151,018
36,370
226,973
195,700
38,550
222,490
7,400
3,700
88,800
3,700
10,860
60,690
7,580
25,260
50,342
45,908
118,260 120,475
21,000 123,704
569,760 I 754,790
52,980
63,060
90,480
251,330
914,590
9,060
37,320
11,6
59,000 | 150,770
191,104
10,900
436,364
65,820
93, 000
192, 470
496,564
661, 560
866, 790
1,039,390
7,125
6, 800
950
6,020
5, 400
5, 895
5,426
5,000
1,382
4, 500
1, 017
4, 066
919
4,256
1,110
3, 771
1, 168
4, 000
1, 270
4,229
1,447
Extra compensation paid by the Federal Reserve Bank of Dallas for the years 1917-1921.
[Salaries shown are annual salaries. Per cent of extra compensation based on actual salary received during
period.]
Per
Per
Jan. 1 to Dec. 31, 1917:
Less than $1,500
$1,500 to $4,000
Jan. 1 to Dec. 31, 1918:
Up to $1,500
$1,501 to $3,000
$3,001 to $5,000
S, Doc, 75, 67-1
cent.
15
10
:
7
20
15
10
Jan. 1 to Dec. 31, 1919:
Up to $1,500
$1,501 to $3,000
$3,001 to $5,400
Jan. 1 to June 30, 1920:
Up to $1,500.
$1,501 to $3,000
$3,001 to $5,000
cent.
20
15
10
20
15
10
98
EXPENSES OF FEDERAL RESERVE BANKS.
Principal asset and liability items at end of year.
Total cash
reserves.
1915
1916
1917
1918
1919
1920
....
.
.
.
Bills discounted.
Bills bought.
$24,875,000
42,717,000
65,292,000
38,768,000
59,411,000
45, 538, 000
$4,957,000
831,000
8,740,000
45,525,000
58,316,000
70,696,000
2
14
I n d e x of g r o w t h 1915-1920 (1915= 1)
Total earning
assets.
$5,899,000
8,193,000
29,638,000
56,363,000
77,768,000
83,222, 000
$2,202,000
14,140,000
2, 148,000
b, 121,000
247,000
14
Gross deposits.
Federal reserve
notes in
circulation.
$2,753,000
2,696,000
2,795,000
3, 746, 000
6, 451,000
10,132, 000
$14,975,000
33,528,000
60, 530,000
50,204,000
107,662,000
76,460,000
$14,726,000
23,589,000
46,788,000
59, 239,000
74, 930,000
79, 453, 000
4
5
5
Bills bought.
United States
securities
bought.
Total discount
and open market operations.
$3,543,000
9,744,000
25,024,000
12, 415,000
8,348,000
$870,000
4,163,000
1 , 395,000
22,663,000
19, 413,000
176,704,000
$27,703,000
26, 371,000
63,883,000
635,747,000
1,256,774,000
1, 465, 230,000
203
53
Capital and
surplus.
1915
1916
1917
1918
.
1919
1920. . .
I n d e x of g r o w t h 1915-1920 (1915— 1)
Volume of business transacted during the year.
Bills discounted.
$26,757,000
18,512,000
52,052,000
587,678,000
1,224,946,000
1,280,178,000
1915
1916
1917
1918
1919
1920
48
I n d e x of g r o w t h 1915-1920 (1915= 1 ) . . , . .
Federal
reserve notes
issued byagents.
2
1915
1916
1917
1918
1919
1920
I n d e x of growth 1915-1920 (1915=1)
$16,180,000
22,079,000
40,086,000
40,795,000
55, 730, 000
69,245,000
4
Federal
reserve notes
redeemed by
agents.
2
$1,035,000
13,461,000
16,132,000
28,017,000
37, 581,000
63,135,000
1
Currency
received from
member and
other banks.
$75,788,000
159,382,000
$94,718,000
126, 741,000
61
N u m b e r of
Amount of
checks cleared. checks cleared.
1915
1916
1917
1918
1919
1920
Currency
paid out to
member and
other banks.
Transactions
through gold
settlement
fund.
3
.
I n d e x of g r o w t h 1915-1920 (1915= 1)
1
3,717,000
6,323,000
14,149,000
29, 360,000
$990,202,000
2, 741, 224,000
4, 865,992,000
7,307, 341,000
$112,672,000
345, 940, 000
1,300,820,000
2,267, 990,000
4,922,618,000
7,101,179, 000
63
Exclusive of certificates of indebtedness.
Nov. 16, 1914 to Dec. 31, 1915.
Represents daily average for the.period May 20, 1915 (date of first settlement), to Dec. 31,1915, multi
plied by 365.
2
3
99
EXPENSES OF FEDERAL RESERVE BANKS.
Expenses of the Federal Reserve Bank of Dallas.
Nov. 16
t o Dec.
31,1914.
Expenses of operation:
SalariesBank officers
$4,125
Clerical staff
2,897
Special officers and
1
watchmen
Allother
116
Federal advisory council,
governors' and Federal reserve agents' conferences
Directors' meetings, legal
fees, officers' and clerks'
traveling expenses, lifeinsurance and fidelitybond premiums
1,952
Assessments for Federal Reserve Board expenses
Taxes and fire insurance
Telephone and telegraph...
97
Rent, light, heat, and power.
1,258
Printing and stationery
4,296
All other, including postage
and insurance on mail, security, and currency shipments, repairs and alterations, etc
215,577
Total expenses of operation
Federal reserve currency (original cost, including snipping
charges)
Miscellaneous charges, account
note issues
Taxes on Federal reserve bank
note circulation
Furniture and equipment
Bank premises
*
Total expenses
1915
1916
1917
1918
1919
$32,373
26,255
$33,942
37,885
$43,220
67,232
$68,544
170,134
$87,212
390,993
$117,768
649,100
1,146
1,806
1,771
2,835
2,762
3,636
4,314
5,464
6,363
11,883
20,177
39,458
2,080
2,668
756
2,548
1,889
1,115
14,292
8,514
11,727
25,188
34,733
71,070
15,675
9,665
927
8,583
5,116
1,629
1,378
2,900
11,439
1,212
1,606
1,708
17,104
15,223
1,211
11,551
3,072
25,072
20,362
1,746
24,961
8,891
41,009
21,695
3,476
60,838
21,800
67,998
11,786
24,102
32,512
73,809
145,500
236,735
120,039
127,289
194,914
406,130
775,542
1,311,228
18,920
14,443
30,911
82,730
85,719
86,514
8,028
22,825
42,829
70,718
46,397
82,88'i
982,836
1,549,847
1
30,319
30,319
1920
138,959
1 566
9,528
35,171
52,758
4,806
152,826
260,996
546,424
1
Total assessment for Federal Reserve Board expenses to Dec. 31,1915.
2 Includes $14,556 expenses prior to Nov. 16, 1914.
Current expenses of the El Paso branch of the Federal Reserve Bank of Dallas.
19181
Salaries:
Bank officers
Clerical staff
Special officers and watchmen
All other
Directors' meetings, legal fees, officers' and clerks' traveling expense-;, lifeinsurance and fidelity-bond premiums
Taxes and fire insurance
f
Telephone and telegraph
Rent, light, heat, and power
Printing and stationery
Furniture and equipment
All other—including postage and insurance on mail, security, and currency
shipments, repairs and alterations, etc
Total current expenses
1
Branch opened for business June 17,1918.
1919
1920
$6,650
16,098
670
393
$12,338
49,494
191
732
$15,904
65,183
3,810
4,456
2,599
61
470
188
5,072
20,163
4,692
61
1,726
1,226
6,064
3,793
8,200
1,292
16,141
1,877
8,403
15,385
9,108
19,776
33,009
61,472
100,093
173,660
100
EXPENSES OF FEDERAL RESERVE BANKS.
Current expenses of the Houston branch of the Federal Reserve Bank of Dallas.
19191
Salaries:
Bank officers
Clerical staff
Special officers and watchmen
All other
Directors'-meetings, legal fees, officers' and clerks' traveling expenses, life-insurance
and fidelity-bond premiums
Taxes and fire insurance
Telephone and telegraph
Rent, light, heat, and power
•»
:
Printing and stationery
Furniture and equipment
All other, including postage and insurance on mail, security, and currency shipments,
repairs and alterations, etc
*.
Total current expenses.
1920
$9,338
28.545
966
778
$13,651
95,270
5,324
5,457
6,835
13,34$
46'0
8,047
6,474
13,829
1«316
536
1,002
10,182
42,832
20,153
47,012
121,167
228,183
i Branch opened for business Aug. 4,1919.
EXHIBIT D, PART 12.
FEDERAL RESERVE BANK OP SAN FRANCISCO.
Comparison, of salaries paid to officers of the Federal reserve bank os of Oct. 1, 1921, with
salaries paid to officers of three of the large national banks in San Francisco as of Sept. 6,
1921.
Annual salary.
Governor
Chairman and Federal reserve agent
Deputy governor
Assistant Federal reserve agent and chief examiner
Assistant deputy governor
Do
Cashier
Assistant cashier
Assistant Federal reserve agent
Assistant cashier
Do
Do
Do
Do
Do
Do
Do
Manager, Los Angeles branch
Assistant manager, Los Angeles branch
Assistant cashier, Los Angeles branch
Acting assistant cashier, Los Angeles branch
Manager, Portland branch
Assistant manager, Portland branch
Assistant cashier, Portland branch
Manager, Salt Lake City branch
Assistant manager, Salt Lake City branch
Assistant cashier, Salt Lake City branch
Do
•
Manager, Seattle branch
Assistant manager, Seattle branch
Acting assistant cashier, Seattle branch
Manager, Spokane branch
Assistant manager, Spokane branch
Assistant cashier, Spokane branch
Acting assistant cashier, Spokane branch
Total
'
,
$24, 000
24, 000
15, 000
12, 000
12, 000
10, 000
7, 000
5, 500
5,100
4, 800
4, 800
4, 500
4, 500
4, 000
3, 600
3, 300
3, 300
8, 000
4, 200
4, 000
2, 700
6, 000
4, 000
2, 880
8, 000
4, 500
3,600
3,300
6, 000
3, 300
3, 000
5, 000
4, 500
3, 300
2, 400
226, 080
101
EXPENSES OF FEDERAL RESERVE BANKS.
National banks in San Francisco.
A n n u a l salary.
Position.
Bank C.
B a n k A. B a n k B .
Chairman of board and president
$50,000
President .
Vice p r e s i d e n t
Do
.
$50,000
18,000
18,000
12,000
12,000
12,000
Do
Do
Do
Do
.
Do. ..
O t h e r officers
Total .
.
.
.
...
64,800
$36,000
15,000
15,000
11,000
9,000
9,000
9,000
7 200
36,900
186,800
148,100
30,000
15,000
13,200
12,400
35,100
155,700
SUMMARY.
Annual salaries.
Number
of officers.
Federal reserve b a n k .
Bank A
.
35
17
15
11
.
Bank B
Bank C
Average.
Total.
$226,080
186,800
148,100
155,700
$6,459
10,988
9 873
14,155
Index of growth in number of officers and employees, in their aggregate salaries, and in
business of the bank.
[1915=1.]
Assets and liabili- Volume of business.
ties.
Personnel.
Year.
Officers and
employees.
Officers.
Earning
assets.
Number. Salaries. Number. Salaries.
1
1
2
3
4
5
1
1
3
5
6
8
1915
1916
1917 .
1918
1919
1920
1
3
11
80
168
263
1
3
13
41
47
53
1
7
19
50
78
93
1
1
6
11
13
26
1
3
12
24
26
51
Federal Discount
reserve and opennote
market
circulaoperation.
tions.
Gold
settlement
fund.
1
3
26
42
60
74
Number of officers and employees.
Dec. 31—
Julvl,
1921.
1915
Officers:
Chairman and Federal reserve agent
Governor.
..
Deputy governor
Other officers.
Total officers... .
1917
1916
1918
1919
1920
1
1
1
1
1
1
1
2
1
1
1
9
1
1
1
17
1
1
1
22
1
1
1
28
1
1
1
31
4
5
12
20
25
31
34
102
EXPENSES OF FEDERAL RESERVE BANKS.
Number of officers and
employees—Continued.
Dec. 31—
July 1,
1921.
1915
Employees:
Banking department
Bookkeeping department.
Transit department
Federal reserve agent's department
Auditing department
Fiscal agency department....
General .
Total employees
Total officers and employees
Average number of employees per officer
1916
1917
1918
1919
10
2
1
3
31
5
15
2
77
17
31
3
157
27
64
10
2
4
122
11
18
57
22
5
62
11
1920
207
40
176
33
100
18
33
129
53
429
54
250
23
53
183
109
579
52
246
38
61
206
122
261
511
542
1,101
1,304
273
22
531
26
567
22
1,132
36
1,338
38
Salaries of officers and employees.
Dec. 31—
July 1,
1921
1915
Officers:
Chairman and Federal reserve agent
Governor
Deputy governor
Other officers
Total (bonus excluded)...
Employees:
Banking department
Bookkeeping department...
Transit department
Federal reserve agent's department
Auditing department
Fiscal agency department..
General
Total (bonus excluded)...
Total, officers and employees
Average salary payable to—
All officers
Officers other than ohairman and Federal reserve
agent, governor, and
deputy governors
Employees
1916
1917
1918
1919
1920
$12,000
15,000
6,000
4,200
$12,000
15,000
5,000
7,200
$14,000
18,000
10,000
29,500
$14,000
18,000
10,000
58,280
$18,000
18,000
10,000
98,000
$24,000
24,000
12,000
113,020
$24,000
24,000
15,000
151,480
37,200
39,200
71,500
100,280
144,000
173,020
214,480
14,820
2,520
780
30,230
4,620
11,640
101,046
18,240
28,740
190,560
30,960
62,940
237,380
40,740
108,720
581,592
71,340
305,760
887,060
76,260
326,100
7,000
1,620
59,780
88,380
245,280
152,100
112,800
288,740
195,600
3,420
16,224
146,100
253,140
72,920
43,460
49,900
128,340
' 79,000
1,800
4,620
26,920
52,730
298,526
626,744
687,540 1,504,232 1,982,940
64,120
91,930
370,026
727,024
831,540 1,677,252 2,197,420
9,300
7,840
5,958
5,014
5,760
5,581
6,308
4,200
1,496
3,600
925
3,278
1,144
3,428
1,227
4,455
1,268
4,036
1,366
4,886
1,521
Extra compensation paid by the Federal Reserve Bank of San Francisco for the years
1916-1921.
[Salaries shown are annual salaries. Per cent of extra compensation based on actual salary received
during period.]
Jan. 1 to Dec. 31, 1916:
One-half of 1 month's salary to all officers and employees up to deputy
governor, who have been in service 1 year or more; one-fourth of 1 month's
salary to those employed 6 months but less than a year; one-eighth of 1
month's salary to those in service over 3 months but less than 6 months.
Minimum payment to any employee
$10
Jan. 1 to Dec. 31, 1917:
Percent.
Less than $1,500
15
$1,500 to $6,000
10
103
EXPENSES OF FEDERAL RESERVE BANKS.
Jan. 1 to Dec. 31, 1918:
Up to $1,500
$1,501 to $3,000
$3,001 to $5,000
Jan. 1 to June 30, 1918:
Up to $1,500
$1,501 to $3,000
$3,001 to $5,000
July 1 to Dec. 31, 1919:
Up to $1,800
$1,801 to $3,000
$3,001 to $5,000
Jan. 1 to June 30, ?920:
Up to $1,800
$1,801 to $3,000
$3,001 to $5,000
July 1 to Dec. 31, 1920:
Up to $1,800
$1,801 to $3,000
$3,001 to $5,000
Jan. 1 to June 30, 1921:
Up to $1,800
Per cent.
20
15
10
„
20
15
10
25
20
15
25
20
15
20
15
10
^
15
Principal asset and liability items at end of year.
Bills discounted.
Total cash
reserves.
1915
1916
1917
1918
1919
1920
. .:
Bills bought.
Total earning
assets.
$20,540,000
35, 894,000
94,427,000
151, 491,000
184, 539,000
183,095,000
$450,000
251,000
25,780,000
78, 759,000
73, 896,000
167, 598,000
$652,000
12,462,000
17,082,000
36, 280,000
102, 558, 000
46,798,000
$2,448,000
16, 584,000
46, 818,000
123,224,000
190, 930,000
227, 5i4,000
9
372
72
93
Index of growth 1915-1920 (1915= 1)
Gross deposits.
Federal reserve
notes in
circulation.
$3,942,000
3, 929,000
4,162,000
5,861,000
13,289,000
21,121,000
$17,568,000
44,506,000
88,650,000
95,366,000
162, 446, 000
157, 955,000
$5,149,000
13,137,000
67, 744, 000
212,245, 000
242,462,000
272, 463,000
5
9
53
Capital and
surplus.
1915
1916
1917
1918
1919
1920
Index of growth 1915-1920 (1915= 1).
Volume of business transacted during the year.
Bills discounted.
1915
1916
1917
1918 .
1919
1920
$3,230,000
32,776,000
48,017,000
150,654,000
345,827,000
364,845,000
$1,010,000
2,624,000
2,143,000
56,654,000
116,699,000
445,745,000
$14,335,000
43,336,000
153,927,000
1,148,749,000
2,413,588,000
3,776,237,000
407
113
441
263
Exclusive of certificates of indebtedness.
Total discount
U. S. securities and
open-marbought.
ket operations.
$7,288,000
1,973,000
102,?81,000
941,441,000
1,951,062,000
2,965,647,000
Index of growth, 1915-1920 (1915=1)....
1
Bills bought.
1
104
EXPENSES OF FEDERAL BESEKVE BANKS.
Volume of business transacted during the year—Continued.
Federal reserve Federal reserve
notes issued notes redeemed
by agent.
by agent.
1915
1916
1917
1918
1919
1920
.
. . .
i $6,760,000
12,840,000
66,820,000
165,380,000
186,330,000
181,970,000
i $310,000
4,509,000
4,503,000
13,240,000
135,544,000
148,850,000
27
480
Index of growth, 1915-1920 (1915=1)....
Number of
checks cleared.
1915
1916
1917
1918
1919
1920
Currency received from
member and
other banks.
Currency paid
out to member
a n d other
banks.
$225,094,666
378,750,000
Amount of
checks cleared.
$215,581,000
498,819,000
Transactions
through gold
settlement
fund.
2 $90,029,000
245,511,000
2,339,177,000
3,746,196,000
5,366,032,000
6,703,541,000
3,047,666 $2,059,361,000
9,116,000
16,209,000
30,218,000
4,763,955,000
7,305,341,000
8,668,570,000
v
Index of growth, 1915-1920 (1915= 1)
74
i Nov. 16,1914, to Dec. 31, 1915.
a Represents daily average for the period May 20, 1915 (date of first settlement), to Dec. 31, 1915, multiplied by 365.
Expenses of the Federal Reserve Bank of San Francisco.
Nov. 16 to
Dec. 31,
1914.
Expenses of operation:
SalariesBank officers
Clerical staff
Special officers
watchmen
and
Federal advisory council,
governors' and Federal
»reserve agents' conferences
Directors' meetings, legal
fees, officers' and clerks'
traveling expenses, lifeinsurance and fidelitybond premiums.
Assessments for Federal Reserve Board expenses
Taxes and fire insurance..
Telephone and telegraph
Rent, light, heat, and power
Printing and stationery
All other, including postage
and insurance on mail,
security and currency
shipments, repairs and
alterations, etc
Total expenses of operation
Federal reserve currency (original cost, including snipping
charges)
Miscellaneous charges, account
note issues
Taxes on Federal reserve bank
note circulation
Furniture and equipment
Bank premises
Total expenses.
1
1915
1916
1917
1918
*1919
1920
$5,133
5,543
$40,750
24,032
$41,208
33,553
$56,657
85,813
$94,605
287,608
$136,807
491,627
$188,017
1,018,812
7
113
123
434
160
1,595
1,117
13,757
19,005
33,150
38,691
301
4,267
4,160
1,309
3,998
6,197
4,372
3,791
7,062
12,553
32,242
47,787
84,034
21,688
13,786
186
2,460
879
610
15,916
4,875
973
12,164
8,472
16,560
104
4,996
15,249
23,484
22,277
7,768
16,575
21,266
50,933
33,790
5,672
32,841
9,108
88,080
45,964
8,222
81,030
30,409
178,489
21,723
6,988
20,837
50,222
236,993
163,022
282,364
38,016
123,030
142,338
267,541
776,977 1,047,693
1,993,554
7,273
49,031
34,998
238,746
187,486
219,398
981
8,077
9,678
28,411
40,600
45,169
35,400"
119,671
13,094
46,283
202,751
1,784
1
2
12,589
38,016
130,303
204,939
28,142
338,758 1,070,570 1,431,755
Total assessmant for Federal Resfrve Board expenses to Dec. 31, 1915.
a Includes $19,809 expenses prior to Nov. 16, 1914.
2,502,586
105
EXPENSES OF FEDERAL RESERVE BANKS.
Current expenses of the Los Angeles Branch of the Federal Reserve Bank of San Francisco,
1920*
Salaries:
Bank officers
$12,133
Clerical staff
207,102
Special officers and watchmen
7, 450
All other
2,518
Directors' meetings, legal fees, officers' and clerks' traveling expenses, life
insurance and fidelity bond premiums
6,874
Taxes aud fire insurance
557
Telephone and telegraph
10, 485
Rent, light, heat, and power
12, 954
Printing and stationery
28,118
Furniture and equipment
68,962
Bank premises
All other, including postage and insurance on mail, security and currency
shipments, repairs and alterations, etc
68,581
Total current expenses
425,734
Current expenses of the Portland branch of the Federal Reserve Bank of San Francisco.
19171
Salaries:
Bank officers
Clerical staff
Special fficers and watchmen
All other.
Directors' meetings, legal fees, officers' and clerks' traveling
expenses, life-insurance and fidelity-bond premiums
Taxes and fire insurance
Telephone and telegraph
Rent, light, heat, and power
Printing and stationery
Furniture and equipment
All other, including postage and insurance on mail, security and
currency shipments, repairs and alterations, etc
Total current expenses
1918
1919
1920
$6,246
21,887
62
38
$9,037
40,155
1,343
1,335
$11,542
71,498
1,761
2,990
2 16
1,739
2,089
3,638
4,154
2,570
2,500
23
3,409
3,781
7,885
3,990
2,715
186
903
2,352
1,664
13,055
13,937
17,635
10,292
55,478
87,395
143,687
$1,617
3,544
10
8,525
3,845
9,374
13,802
i Branch opened for business Cct. 1,1917.
«Credit.
Current expenses of the Salt Lake City branch of the Federal Reserve Bank of San Francisco.
19181
Salaries:
Bank officers
Clerical staff
Special officers and watchmen
. All other
Directors' meetings, legal fees, officers' and clerks' traveling expenses, lifeinsurance and fidelity-bond premiums
Taxes and fire insurance
Telephone and telegraph
Rent, light, heat, and power
Printing and stationery
Furniture and equipment
All other, including postage and insurance on mail, security and currency
shipments, repairs and alterations, etc
-.
Total current expenses
1
Branch open for business Apr. 1, 1918.
a Branch opened for business Jan. 2,1920.
1919
1920
$4,986
34,056
907
317
$10,745
74,403
826
1,595
$16,335
151,023
3,584
4,736
1,572
44
811
3,580
5,942
20,237
2,373
5,081
56
11,920
9,798
23,892
33,581
4,874
7,337
10,489
9,666
12,984
17,874
20,694
85,436
140,182
280,700
106
EXPENSES OF FEDERAL RESERVE BANKS.
Current expenses of the Seattle branch of the Federal Reserve Bank of San
Salaries:
Bank officers
Clerical staff
Special officers and watchmen
All other
Directors' meetings, legal fees, officers' and clerks' traveling
expenses, life-insurance and fidelity-bond premiums
Taxes and fire insurance
Telephone and telegraph
Rent, light, heat, and power
Printing and stationery
Furniture and equipment
All other, including postage and insurance on mail, security and
currency shipments, repairs and alterations, etc
Total current expenses
Francisco.
19171
1918
1919
$1,882
5,207
77
$7,002
24,388
157
72
$10,290
46,416
1,640
771
$12,895
8'\983
3,759
1,729
222
3,832
?,607
367
1,129
1,927
2,109
3,900
3,421
3,859
3,453
4,099
7,218
8,360
3,663
94
7,420
5,044
12,500
19,040
1920
3,457
14,552
23,699
15,439
14,268
64,192
107,553
171,566
i Branch opened for business Sept. 19,1917.
Current expenses of the Spokane branch of the Federal Reserve Bank of San
Salaries:
Bank officers
Clerical staff
Special officers and watchmen
All other
Directors' meetings, legal fees, officers' and clerks' traveling
expenses, life-insurance and fidelity-bond premiums
Taxes and fire insurance
Telephone and telegraph
Rent, light, heat, and power
Printing and stationery
Furniture and equipment
All other, including postage and insurance on mail, security
and currency shipments, repairs and alterations, etc
Total current expenses
1
Francisco.
1917 i
1918
$2,694
7,011
224
160
$6,412
25,474
120
300
$11,249
46, 540
681
1,050
$12,519
78,971
2,093
2,177
1,549
64
559
2,116
2,299
1,729
2,537
2,238
4,169
3,807
3,540
3,624
5,637
7,024
19,749
3,005
269
7,788
6,036
10,076
11,147
2,989
19,665
54,775
1919
1920
14,130
14,000
112,221
148,081
Branch opened for business July 26,1917.
EXHIBIT E.
OCTOBER 11,
Hon.
1921.
SYDNEY ANDERSON,
Chairman Joint Commission of Agricultural Inquiry,
United States Congress.
DEAR MR. CHAIRMAN: In the record of the statements made by a former Comptroller of the Currency and ex officio member of the Federal Reserve Board to the
commission on August 2 and 3, there are included two addresses made by him, one
in Washington on April 15, 1921, and the other in Augusta, Ga., on July 14, 1921, in
which certain allegations are made reflecting upon the intelligence and efficiency,
and, by innuendo, upon the probity of members of the Federal Reserve Board. Other
statements with which the board takes issue appear in various communications to
the board which the former comptroller introduced in his testimony.
Many of these allegations are so trivial and irrelevant as to be unworthy of notice,
and others, particularly those which relate to credit policies, it is believed have been
fully answered in the statements made by Gov. Strong and myself before your commission on August 4 and subsequent days, and in letters which have been introduced
in the record. Having in mind the desire of the commission to assemble as promptly
as possible facts'more directly related to the purposes for which it was organized, I
did not deem it opportune when I was before the commission to take up its time in
answering the general charges made by the former comptroller that the board had
approved or permitted reckless waste of money in the operations of the Federal
reserve banks, particularly with respect to the building of the Federal Reserve Bank
of New York, now in course of construction, and to the salaries paid to the officers
of the Federal Reserve Bank of New York.
EXPENSES OF FEDERAL RESERVE BANKS.
107
In each annual report of the Federal Reserve Board to Congress an exhibit has been
made of the number of officers and employees of all Federal reserve banks and of
their salaries.
In its annual report for the year 1918, the board called the attention of Congress
to the necessity of providing adequate quarters for the Federal reserve banks and
reported purchases of building sites which had been made by 10 of the 12 banks. In
each subsequent report a frank statement has been made to Congress of the progress
of the building operations by the respective banks.
When the Committees on Banking and Currency of the Senate and House of Representatives were considering, early in the year 1919, the board's recommendation that
section 7 of the Federal reserve act be amended by permitting the banks to create a
maximum surplus out of earnings equal to 100 per cent of their paid-in capital, instead
of 40 per cent as previously provided, I called the attention of the committees to the
fact that all Federal reserve banks would be obliged to construct their own buildings,
as it was not practicable to lease adequate quarters and otherwise to provide suitable
vaults for the custody of the large amounts of cash and securities held by the banks.
I called attention also to the large expenditures which would have to be made in these
building operations, and urged that the banks be permitted to increase their surplus
in order to reduce the proportion of fixed assets represented by the buildings to their '
capital account. The committees appeared to be impressed with this argument, for
the act of March 3, 1919, went beyond the board's recommendations and provided that
Federal reserve banks might create a surplus out of earnings equal to 100 per cent of
their subscribed capital, plus 10 per cent of net earnings annually, after such a surplus
had been created.
As no criticism has been made to the commission by the former comptroller, however,
of any of the Federal reserve bank buildings except that of the Federal Reserve Bank
of New York, it seems unnecessary at this time to present further data relating to any
of them except the one in New York. The board understands that the governor of
the Federal Reserve Bank of New York has submitted to the commission a full statement regarding the building operations of that bank, every important detail of which
has been submitted from time to time to the Federal Reserve Board.
Since he appeared before the commission, the former comptroller has given to the
press a letter directing his criticism especially to the salaries paid to officers and
employees of the Federal Reserve Bank of New York, and this letter has recently
been inserted in the Congressional Record.
Each Federal reserve bank is by law placed under the supervision and control of a
board of directors who are authorized to appoint such officers and employees as are
not otherwise provided for in the Federal reserve act and to define their duties.
The law also requires that any compensation that may be provided by the board of
directors of a Federal reserve bank for directors, officers, or employees shall be subject
to the approval of the Federal Reserve Board.
I transmit herewith copy of a letter, dated October 6, 1921, from the governor of
the Federal Reserve Bank of New York, in which he discusses not only the salaries of
officers which have been specifically criticised by the former comptroller, with the
exception of his own and that of the Federal reserve agent, but also the increase in
the number of employees and in their compensation. The board has, in approving
salaries and increases in salaries from time to time, been advised of all the facts set
forth in this letter, and its approval of the salaries proposed by the directors has been
based upon an appreciation of these facts. This letter contains a detailed review of
the principles governing the salary policies of the Federal Reserve Bank of New York,
the approval of which by the members of the Federal Reserve Board is evidenced by
their action in approving from time to time specific salaries and increases voted by
the bank's directors. Inasmuch as Governor Strong's sense of propriety does not
permit him to discuss in his letter the salaries paid the Federal reserve agent and
himself, particular reference will be made to these salaries in this communication.
The Federal reserve agent is appointed by the Federal Reserve Board and his
salary is fixed by the board. All other officers and employees of the Federal reserve
bank, except those in the Federal reserve agent's department, are appointed by tiie
board of directors and the salaries fixed by them, subject to the approval of the Federal
Reserve Board.
The officers of Federal reserve banks are not officers of the United States. They
are private citizens, just as officers of national banks, which are, like Federal reserve
banks, chartered under an act of Congress, are private citizens.
The conduct of the business of a Federal reserve bank, and of the Federal Reserve
Bank of New York especially, which is now the largest banking institution in the
country, with transactions many times greater than those of the largest member banks,
with great responsibilities to its member banks, to the public, and to the Treasury
108
EXPENSES OF FEDERAL RESERVE BANKS.
of the United States, requires the services in executive and other capacities of trained
officials and experts who will devote all of their time to the work of the bank, not only
in the ordinary routine but in the study of a great variety of technical subjects, and
it is highly desirable that men be obtained who can always be relied upon to show
good judgment and all other necessary qualifications.
These officers are not permitted to engage in any other business or in political
activities or to hold public office. Their service in the Federal reserve bank is not
a stepping stone to a political career nor does it afford means of outside financial profit.
It would be impossible to secure the services of competent and efficient officials for
the Federal reserve banks were their salaries to be measured by the salaries paid to
the political officers of the Government.
In the former comptroller's letter, above referred to, and in his Augusta speech,
which is a part of the record of the commission, he appears to take the position that the
salary of a United States Senator is the standard upon which salaries of Federal reserve
bank officials should be based. He did not himself, however, while he was in office,
observe this principle, but on the contrary recognized the fact that in order to obtain
competent national bank examiners, who, by the way, are officers of the Government,
he would be obliged to pay regard to the technical skill and ability of these men and
to what they could earn in the employ of private banking institutions and corporations.
These examiners are appointed by the Comptroller of the Currency, with the
approval of the Secretary of the Treasury, and their salaries are fixed by the Federal
Reserve Board "upon the recommendations of the Comptroller of the Currency."
The board does not regard these salaries as excessive, and in what follows no such
inference should be drawn.
The report of the Comptroller of the Currency for 1920 gives in one item (page 22,
second volume) jthe total of the "expenses on account of the national bank examining service," which includes salaries and other expenses incurred in making examinations, including traveling expenses, but does not give any statement, either in
detail or in the aggregate, of salaries paid national-bank examiners. The report of the
Federal Reserve Board for the same year, however, gives a complete detailed list of
salaries paid national-bank examiners (pages 278-280). These salaries were initiated
and recommended, in each instance, by the Comptroller of the Currency, just as
salaries of Federal reserve bank officers and employees are initiated by the directors
of the Federal reserve banks.
The report shows that 10 examiners are paid salaries equal to or in excess of that of
a United States Senator; that 1 examiner is paid a salary in excess of that of 2 United
States Senators; and that the aggregate of salaries paid these 10 examiners is more than
the salaries paid 13 United States Senators. It shows also that the total salaries of all
national-bank examiners on the pay roll as of December 31, 1920, aggregate $637,900,
an amount equal to the salaries of 85 United States Senators. In addition to this,
during the year 1920, two national-bank examiners were, for a time, each paid a salary
at the rate of $30,000 per annum, an amount equal to that paid 4 United States Senators, but it is only fair to state that these examiners were detailed to examine foreign
branches of national banks and that these salaries were designed to cover ocean
transportation and all traveling and living expenses while they were engaged in making these examinations abroad.
The foregoing comparisons are made merely to show the absurdity of attempting to
draw conclusions from totally unrelated facts.
In its annual report for 1918 the board said:
" I t is evident that the Federal reserve banks, in order to insure the proper conduct
of their business and to protect the interests of the Government, the member banks,
and the public, must employ men of exceptional experience and ability. Experience has-shown that the larger member banks are disposed to draw upon the Federal
reserve banks for men to fill high official positions, and in order to retain the services
of officers who are constantly being tempted with outside offers at high salaries it has
become necessary to recognize this competition. While the board has in no case
approved salaries for Federal reserve bank officers as high as those paid officers of similar rank by the larger member banks in the various Federal reserve cities, it has
approved salaries approximating the average salaries paid by the larger local banks.
In the case of junior officers, heads of divisions, and clerks, the board has recognized
from the outset that the compensation paid them must be in line with that paid by
the larger member banks. The board does not believe that the Federal reserve banks
should become training schools for future officers of member banks. It feels, on the
contrary, that sufficient inducements should be offered by the Federal reserve banks
to make service with them attractive as a career."
During the past seven years four governors of Federal reserve banks have resigned
in order to accept executive positions with other banking institutions at much higher
EXPENSES OF FEDERAL RESERVE BANKS.
109
salaries, and the same is true with respect to a considerable number of deputy governors
and junior officers.
The board does not regard the salaries paid the governor of the Federal Reserve
Bank of New York and the Federal reserve agent as being excessive. No one who is
familiar with the qualifications of these gentlemen, their long experience in banking, ,their established position in the banking community before the Federal reserve
bank was organized, the magnitude of their responsibilities, and the opportunities
which are constantly afforded them to make other and more profitable engagements,
would assert for a moment that they are being paid more than they are worth.
The only question, therefore, to be considered is: Does the business of the Federal
Reserve Bank of New York require the services, as its two senior officers, of men of
their type? The board believes that it does, and it believes, furthermore, that it
would be false economy to depend upon less able and experienced men.
I am inclosing for the information of the commission copy of a letter from Governor
Strong, which outlines the history of his connection with the Federal Reserve Bank
of New York. The statements made therein were already familiar to some members
of the board who have served continuously since 1914.
The directors of the Federal Reserve Bank of New York voted in September, 1917,
to increase the governor's salary from $30,000 to $50,000 per annum, and the question
of approval was considered by the Federal Reserve Board. Upon being informed,
however, that Mr. Strong would not then accept this increase, and in view of the fact
that the country was at war, the board took no action. The records of the Treasury
Department will show what was done by the Liberty loan organization of the Federal
Reserve Bank of New York, under the leadership and supervision of Gov. Strong, in
the placing of Government securities during and after the war. In the prosecution
of this work, in connection with his other duties, his health broke down and necessitated his absence from the bank during the year 1920, to which reference is made in
his letter.
In December, 1918, the directors of the Federal Reserve Bank of New York again
voted to increase the salary of Gov. Strong to $50,000 per annum. The following is
an extract from the minutes of the meeting of the Federal Reserve Board on December
14, 1918:
"Present: The chairman (Mr. McAdoo), the governor, Mr. Strauss, Mr. Miller, Mr.
Hamlin, Mr. Williams, Mr. Broderick, secretary.
"Mr. Strauss stated that he had reviewed the recommendations of the Federal
Reserve Bank of New York of increases in salaries of and bonuses to its officers and
employees, and submitted the following report, which was ordered spread upon the
minutes of the meeting:
(Here follows report of Mr. Strauss on a letter from Mr. George F. Peabody, deputy
chairman of the board of directors of the Federal Reserve Bank of New York, on the
subject of increased compensation for employees of the bank.)
"The chairman expressed himself as heartily in accord with the principles propounded by Mr. Strauss. He then explained to the board his views as to the principles that should be observed in determining compensation to officers of Federal
reserve banks. He stated that his attitude had been that in the beginning and during
the formative period of the system he advocated comparatively low salaries until the
business of the banks could be established, and a fair measure obtained of their operations and a more accurate realization reached of the dimensions of the problems and
responsibilities of the banks' officers, adding that last year he had opposed an increase
in the salary of the governor of the Federal Reserve Bank of New York only because
the country was at war. He said, now that the business of the banks had been well
established and they were making large earnings for the Government, the time had
come when the office of governor of a Federal reserve bank should command on its
merits a fair and just compensation, and that he would vote to fix the salary of the
governor of the Federal Reserve Bank of New York at $50,000 per annum, this salary
to prevail not only for the present incumbent, but for his successors. The chairman
stated it as his view that the principle governing the fixing of salaries of officers of
Federal reserve banks should be that the salary be made sufficiently attractive to
make a man willing to adopt the Federal reserve system as a permanent career having
its rewards in the way of promotion like any other institution. He opposed the view
that the office of head of a Federal reserve bank should be considered on a parity with
high Government office, stating that heads of Federal reserve banks could not be said
to enjoy that magnitude of power and prestige pertaining to high Government office,
while the bank officers were yet placed in a different position from those engaged in
private institutions in that they were affected by the mutations of public life and
controlled by a changing public board.
110
EXPENSES OF FEDERAL RESERVE
"The chairman stated that he had conferred with the Secretary of the Treasuryelect, Mr. Carter Glass, who concurred in the substance of the principles recited by
him, leaving it to the board, of course, to make, under such principles, reasonable
adjustments
of salaries throughout the system in its discretion.
4
'The chairman stated as a further principle that the salary of a Federal reserve
agent should be at least as high as that of any deputy governor of the Federal reserve
bank of which such agent may be chairman.
"Mr. Miller pointed out that the tremendous earnings of the Federal reserve banks
had accrued this year largely out of Government business, and asked the chairman if
he had that factor in mind in expressing his opinion on the question.
"The chairman replied that he did not think the percentage basis of earnings of
banks is a fair guide for the measure of compensation to-be paid, stating it as his judgment that the questions of salaries at the several banks should be dealt with each on
its own merits with respect to the responsibility assumed by the governor when
taking office.
"Mr. Strauss stated that the board should not consider the earnings of a bank in
fixing compensation; that at future periods it might well be the business of the banks
not to make money.
"The chairman concurred in this view, stating that it might be necessary to operate
a bank at a loss as a result of a general plan of combining the resources of all banks as a
common fund, in which event, the responsibilities of the governor of a bank forced to
operate at a loss would be even greater than when large earnings were accruing. He
said the problem was to ascertain what is a just compensation, taking into consideration all the elements of the problem—the size of the bank, the cost of living in the
community, and the responsibility assumed by the chief executive officer of the
bank.
"Mr. Williams pointed out that there were certain governors of Federal reserve
banks whom the board felt were not the strongest men for their positions.
"The chairman stated that if the board undertook the responsibility of keeping in
office incompetent men as governors of Federal reserve banks the salaries of such
governors should nevertheless have a relation to the responsibility assumed.
'' On motion, duly seconded, it was voted unanimously that the salary of the governor
of the Federal Reserve Bank of New York for the ensuing year be approved if fixed at
$50,000 per annum, and that the recommendations of the board of directors of the Federal Reserve Bank of New York, as submitted by Deputy Chairman Peabody in his letter
of December 11,1918, as modified in principles by the memorandum submitted by Mr.
Strauss, above, be approved with the understanding that the board will review same
in detail and make such adjustments as may be necessary at its meeting on Monday,
December 16.
'•At this point the chairman (Mr. McAdoo) stated that it was necessary for him to
withdraw from this, the last meeting of the Federal Reserve Board which he would
attend, and expressed to the members of the board his appreciation of the work they
had done during his incumbency of the office of chairman, stating that he would
always have a keen interest in the personal welfare of members of the board, as well
as in their official work."
For the further information of the commission, and in order that it may better determine what weight, if any, should be given to the criticisms made by the former
comptroller of the salaries paid by the Federal Reserve Bank of New York, I transmit a
memorandum made up from the minutes of the Federal Reserve Board showing the
dates of the various meetings at which increases in salaries of officers and employees
of the Fedeml Reserve Bank of New York were considered, and the vote of the comptroller on these proposals. It will be noted that the minutes show that he voted
affirmatively on 80 per cent of the salary increases, including those which he now
criticizes, that he did not vote against any of them, but was absent from meetings at
which the other 20 per cent were considered.
The board requests that this letter and the memorandum attached be made a part
of the record of the commission. If the commission desires any further statement
regarding any other allegation made by the former comptroller, which appears in the
record, the board will be pleased to furnish it without delay.
In view of the fact that the allegations made by the former comptroller are a part of
the official record of the commission and are being constantly reiterated by him, the
board respectfully requests that the commission make public its findings regarding
them.
Very truly, yours,
W. P. G. HARDING, Governor.
EXPENSES OF FEDERAL RESERVE BANKS.
Ill
EXHIBIT F.
OCTOBER 6, 1921.
DEAR GOV. HARDING: Mr. John Skelton Williams, former Comptroller of the Currency, in an address made in Augusta on July 14, 1921, printed in the Congressional
Record under date of July 20, 1921, and printed on pages 36-48 of part 13 of the hearings before the Joint Commission of Agricultural Inquiry, has made certain charges
involving the salary policy of the Federal Reserve Bank of New York. In an open
letter dated September 12, 1921, published on the cover page of the Manufacturers'
Record of September 22, 1921, he has enlarged upon those charges and has made certain statements that are wholly inaccurate or purposely misleading. In a speech
before the United States Senate on October 1, 1921, Senator Heflin introduced into
the Congressional Record (see p. 6645 of the Oct. 3, 1921, issue) a complete copy of
that letter, suggesting "a clean-up of the high salary scandal at the reserve bank in
New York," ,and intimating that the Republican Party should ask for "an immed ate
investigation of this whole disgraceful affair," which he states was "permitted" by
the Federal Reserve Board without protest by the Senate.
All of the present salaries in effect at the Federal Reserve Bank of New York were
approved by the Federal Reserve Board under the terms of the Federal reserve act,
and in a general way they are, of course, familiar with the necessities for those increases.
But for the convenience of the board, and for such disposition as it might deem proper,
I wish to submit herewith a complete review of the conditions and circumstances
upon which the salary policy of the bank has been based and to answer concretely
the charges which have been made against increases heretofore granted.
In brief, the criticisms may be summarized in these two statements appearing in
the Augusta speech just referred to, one, that "the total pay roll of the Federal Reserve
Bank of New York in the period of acute deflation from 1919 to 1920 actually increased
$778,000 in that one year" and, two, that the salaries paid to all officers of the Federal
Reserve Bank of New York in 1916 "aggregated $93,000, while the amount paid for
officers' salaries for the same bank in 1920 was over $400,000."
The letter appearing in the Manufacturers' Record, which is an elaboration of previous critical statements, is printed on the cover page of that paper and is directed
solely as an attack against the Federal reserve bank in the matter of salaries. This
letter has been distributed widely throughout the country. It is obviously ^designed
to create a most incomplete and misleading picture, presenting in absolute terms the
amounts of increase in the pay roll to officers and employees of the Federal reserve
bank without relating those increases to the growth in the volume of work performed
by that institution and without referring in any way to the general average of individual salaiies or to other pertinent factors. I would like to discuss these matters
in detail and on their merits.
The statement is made that the Federal Reserve Bank of New York has been
"distinctly extravagant" and that "despite the reticence of the officials" he can give
some facts and figures of interest to the readers of the periodical to which his letter
was addressed. This inference that the Federal reserve bank has attempted improperly to conceal anything is wholly unfounded. There is not now, and never has been,
any undue "reticence" on the part of the Federal Reserve Bank of New York concerning any of the details of its expense account, whether salaries or other items of
expense. So far as salaries are concerned, and that seems to be the chief item on
which his charge of extravagance is based, section 4 of the Federal reserve act provides that "any compensation that may be provided by boards of directors of Federal
reserve banks for directors, officers, or employees shall be subject to the approval of
the Federal Reserve Board." Every increase in the salary of any officer or employee
of the Federal Reserve Bank of New York has been approved by the Federal Reserve
Board, and it, in its annual report to Congress, under the caption "Personnel and Salaries," reviews the number of officers and employees of every Federal reserve bank
for each year, reciting the amount of the salary received by the "chairman and Federal reserve agent," the "governor," the "deputy governor," and "other officers,"
stating how many there are in each group where there are more than one, and giving
the aggregate for each group.
Under these circumstances, it is difficult to understand how Mr. Williams, an
ex officio member of the Federal Reserve Board, whose duty it was to approve of
salaries of all officers of all Federal reserve I anks, and who, himself, approved of
several different annual reports of the Federal ReEerve Board to Congress, including
the present form and method of reporting the salaries of the Federal reserve banks,
can now with honesty or fairness make the statement that there is "any secrecy as
to the salaries or compensation paid to the officers and other employees of the Federal
reserve banks." If he believed that there is any "secrecy" in the reports of the
112
EXPENSES OF FEDERAL RESERVE BANKS.
Federal Reserve Board, it must be because he now regards as inadequate for his own
private purposes reports which he himself approved when he was a member of the
Federal Reserve Board, and which he apparently at that time thought were sufficiently frank and explicit for the purposes of Congress and the public. While it
is true that the annual reports of the board to Congress do not now mention the names
of the individual officers of the various Federal reserve banks, it is obvious that the
reason for that is solely one of convenience and economy. There is sufficient data
given in each annual report with respect to the salaries of those banks not only to
furnish a ver> definite picture of salary payments as a whole, but also to form the
basis of an intelligent request for more detailed information on the part of any Member
of Congress who may be interested in learning further details. The charge that there
is any "secrecy" must, therefore, be disregarded both as an inaccurate criticism of a
practice which Mr. Williams himself was a party to for several years. It would be
interesting to know how far as a member of the board he actually approved of the
salary increases in the Federal reserve bank of New York which he now flaunts before
the public as an example of extravagance and waste in the expenditure of what he
erroneously terms "public money."
But independently of his own action in all of these matters, it is the belief of the
officers of the bank that the salaries paid by it have not been and are not now in
excess of the value of the services rendered, and an examination of the records and
statistics which have been prepared for and considered b> the officers will, I believe,
be determinative of the fact that the salaries of both officers and employees of the
Federal reserve bank have, on the whole, been much lower, rather than higher, than
the market for such services in the city of New York. What are the facts?
Employees' salaries.—Mr. Williams has said that the total payroll of the Federal
Reserve Bank of New York "in the period of acute deflation from 1919 to 1920 actually
increased $778,000 in that one year.
It is needless to comment upon the inaccuracy
of the statement that the period from 1919 to 1920, when the increase of $778,000 in the
salary roll of the Federal Reserve Bank took place, was a period of "acute deflation, "
since it was at that time, in January of 1920, that prices were rising at their most rapid
rate. An inspection of the chart hereto attached, indicating the trend of wholesale
commodity prices in four countries, shows graphically how rapid was the rise in these
prices in the winter of 1919-20, when the increase in the salary roll to which Mr.
Williams refers took place. The general index shows an increase from 207 per cent
to 238 per cent of the prewar level between June, 1919, and December, 1919. So,
also, the report of the National Industrial Conference Board on the cost of living in
the United States, and particularly the report of the Department of Labor showing
the cost of living in the city of New York, which are attached hereto, show conclusively that the greatest increase in living costs took place in the fall of 1919, when
the index shows an increase in the city of New York of 17 per cent from 176 per cent
in July, 1919, to 206 per cent on January 1,1920. Furthermore, from the 1st of January,
1920, to the high point, in May, 1920, living costs increased still further by 7 per cent.
It seems, therefore, that the statement that has been made on numerous occasions, •
and which even as late as September 12, 1921, was presented to the public in an open
letter to the Manufacturers Record, concerning the great increase in the salary roll
of the bank during what is called "the years of acute deflation from 1919 to 1^20,"
is wholly misleading and obviously calculated to deceive the public as to the true
state of facts.
Furthermore, in all of the criticisms with reference to the increase in the bank's
salary roll, no mention is made of the tremendous growth in the work of the bank
during the period referred to. In considering the propriety of salary expenditures
it is necessary to bear in mind these two factors, first, the relation of the number of
employees to the volume of business done, and second, the general average salary for
eacn individual. If it can be demonstrated, as I believe the statistics and charts
submitted herewith do demonstrate, that the bank's force has not increased out of
proportion to the volume of work done, the only other question for consideration is
whether the general average salary has increased out of proportion to the general wage
scale in the same vicinity.
The Federal Reserve Bank of New York was organized in November, 1914. On
January 1, 1915, the total number of employees (exclusive of officers) was 36; the total
annual payroll (exclusive of officers) was $48,014; and the general average of all salaries
paid was $1,334. Following is submitted a table showing the change in the number
of employees at the bank, the total annual payroll, and the general average salary
for the first of each year from 1915 to 1921, inclusive.
EXPENSES OF FEDERAL RESERVE BANKS.
Number of
employees.
%
January 1—
1915
1916
1917.....
1918r
1919
1920
1921
.
. . .
-
....
36
71
164
814
2,630
2,768
2,734
113
Average
Total an- salary,
nual pay clusive exof
roll.
any bonus.
$48,014
85,987
160,460
853,256
3,007,550
3,965,660
4,056,783
$1,334
1,211
978
1,048
1,144
1,433
1,484
NOTE BY FEDERAL RESERVE BOARD.—Figures given in the above table are based on the bank's records
as of January 1 of each year and include the salary increases effective as of January 1 and the changes in
the number of employees effective as of the first of the year, whereas figures given in the Federal Reserve
Board's statement represent the number of employees and their aggregate annual salaries as of December
31 of each year before the above changes took place. Employees of the Buffalo branch are included in the
board's figures but not in the bank's figures.
It will be observed from this table that while the salary roll as a whole has increased
rapidly the increase is due principally to the large increase in the number of employees on the bank's pay roll, an increase necessitated by the very rapid growth in
the bank's business from the shell of an organization in 1914 to what is now the largest
bank in the United States, with over $1,500,000,000 in resources, doing billions of
dollars of business a year, and frequently $1,000,000,000 in transactions in one day.
I am submitting herewith for the information of the board a table showing the growth
in the bank's work during this period. Summarized, this table shows that the volume
of work done by the bank during the year 1920 was over 64 times what it was during
the calendar year 1915. In spite, however, of this extraordinary increase in the
volume of the work done by those departments of the bank in which it is possible to
measure the volume of work, nevertheless the number of employees in those same
departments increased only 31 times between December 31, 1915, and December 31,
1920, and only 38 times for the entire bank during the same period. Admitting that
the total pay roll has not increased out of proportion to the work performed by the
employees (in fact it is relatively many times less), the next question is whether the
average individual salary is consistent with the general wage scale in the 1community.
The figures heretofore presented indicate that the general average salary on January
1, 1915, was $1,334; on January 1, 1916, $1,211; on January 1, 1917, $978; on January
1, 1918, $1,048; on January 1, 1919, $1,144; on January 1, 1920, $1,433; and on January
1, 1921, $1,484. The figures covering the general average salary, graphically por-l
trayed in a chart submitted herewith, indicate that the increase in the average salary
of the bank's employees was 8 per cent from January 1,1915, to and including January
1, 1920, when the increase of $665,321 in the employees' salary roll, to which Mr.
Williams refers, was made. It was then that the first large increase ($240) in the
average salaries of the Federal reserve bank employees took place.
What was the justification for this increase? It became apparent to the officers
of the bank during the latter part of 1919 that the financial distress of many of the
clerks was very acute. Many requests had been received from the employees for
salary increases and, upon investigation, it was found that in most cases accumulated savings had been exhausted; many employees had contracted necessary debts
and were unable to pay them; and some could not afford to buy requisite clothing
and food. The conditions disclosed by this investigation were such as to constitute
a source of real danger to the bank in the handling of cash and securities, and demanded that a general salary increase be made. Before that increase was recommended, however, the Federal reserve bank officials made a thorough and careful
analysis of the conditions of the employees, not only in their relation to the increased
cost of living, but also in their relation to other bank employees in New York City.
A very lengthy and careful report was prepared and submitted to the Federal Reserve
Board. It contained an analysis of the salaries paid to employees of 10 other banks
located in the city of New York, itemizing not only the general average salary but
the amount of extra bonus and high cost of living bonus paid by each bank. It
showed that while the average salary paid at that time, that is, in 1919, to the employees of the Federal Reserve Bank of New York, including the bonus of 20 per
cent was $1,440, nevertheless the average salary paid to the employees of each of the
other 10 banks, including the bonus, ranged from a minimum of $1,620 in the case
i Exclusive of bonus.
S. Doc. 75, 67-1
8
114
EXPENSES OF FEDERAL RESERVE BANKS.
of one bank to $2,265 in the case of another. In fact, the average salary of 6 of theae
banks, including the bonus, was over $2,100. Independently of bonuses, it was seen
that our average salary was only $1,200 which was lower than that of all the other
banks except one which paid a bonus of 70 per cent.
It was also found that the United States Bureau of Labor Statistics for September,
1919, showed that food prices for the city of New York increased 75 per cent over
1914, and that from 1914 to June, 1919, clothing had increased 152 per cent; housing
13 per cent; fuel and light 45 per cent; furniture, household goods, etc., 137 per
cent; and miscellaneous or sundry items 75 per cent. While the United States
Bureau of Labor reports show that food prices for New York City had increased only
75 per cent, and while the Federal Reserve Bank of New York in its own report on
business conditions dated October 20, 1919, stated that the expenditures for food
for a typical family in New York City had increased 70.7 per cent since 1914, nevertheless figures published by the State Industrial Commission on September 23, 1919,
showed that food prices averaged 90 per cent higher than in June, 1914, and the
investigation of the conditions of our own employees revealed the fact that their
rents had increased on the average about 30.6 per cent for the year 1919.
The results of these conditions were obvious. The high wages that were being
paid at that time to skilled and unskilled mechanics, longshoremen, truck drivers,
common laborers, and other workers were given much publicity in the press and
caused our employees to compare their salaries with the salaries received by those
of other classes of wage earners. Much dissatisfaction resulted among the clerical
force generally, and this prompted several attempts to organize the bank clerks and
other employees into unions for the purpose of correcting the unfavorable scale of
wages which they were being paid
[ Under all these circumstances and conditions the directors were forced to the
conclusion that a very substantial revision in the salary scale was imperative in
order to maintain the morale and necessities of the force and a continuance of the
successful operation of the bank. The recommendations made by the directors for
salary increases on January 1, 1920, amounted to $665,321. These increases which
were approved by the Federal Reserve Board on December 19, 1919, increased the
""average salary, independent of bonus, from $1,193 to $1,433, and since that time
the average has varied between $1,424 and a high of $1,491 in February of 1921. At
the present time (Sept. 15, 1921) it is $1,489, but the bonus of 20 per cent which
was being paid for the first quarter of 1921 was reduced to 10 per cent in the second
quarter and has since been entirely eliminated.
It may be well at this time briefly to refer to the fact that in 1916 owing to increases
in the cost of living which took place during that year (see chart on cost of living
attached hereto) the directors of the bank recommended the payment of a bonus of
extra compensation on a graded scale of 10 per cent, 7^ per cent, and 5 per cent. The
purpose of this action was to enable the bank's employees to meet rapidly increasing
living costs without at the same time adding to their salaries a permanent increase.
There is inclosed herewith a table showing the amount of annual salary roll and extra
compensation payments from 1915 to July 1, 1921, when the last extra compensation
was paid. As previously remarked, it has now been omitted entirely. The figures,
charts, and tables already submitted have made appropriate references to the so-called
bonus or extra compensation payments, and clearly indicate how relatively low has
been the average salary of the bank's employees even including the extra compensation.
Official salaries.—The next charge which Mr. Williams makes concerning the administration of salaries by the Federal Reserve Bank is that with respect to the salaries
of the bank's officers. The comparisons which have already been made of the employees' salaries, and the necessity for increases in those salaries, are pertinent to a
-consideration of the changes in the salaries of the officers of the bank, although there
are other considerations perhaps even more so.
In his letter of September 12,1921, appearing in the Manufacturers' Record, h^ lays
particular stress upon the increases in the salaries paid to certain officers of the bank
"indicating increases in salaries from the time of their employment to 1920-21."
While he qualifies the figures which he gives by the statement that he believes they
are substantially correct, he adds that he believes that they probably understate,
rather than overstate, the salaries paid at the time. This list of figures is inaccurate
in part, and misleading in whole. It refers to the salaries of only a few more than
half of the entire list of officers and is inaccurate even in many of those which it does
recite.
There follows a revised list of the salaries paid to those officers selected by Mr.
Williams, together with a correct statement of the initial salary paid to each of them
115
EXPENSES OF FEDERAL RESERVE BANKS.
by the bank. For the sake of convenience the percentage of increase has also been
given, together with the number of years over which that increase is spread. Inasmuch as Mr. Williams makes the charge that 60 per cent of the 24 officers mentioned
by him never received over* $1,500 to $2,500 before they came to the reserve bank,
there is another column indicating the salary of each officer received prior to his employment by the bank, whether as an officer or an employee. This particular reference
will be discussed later.
Officer.
Benjamin Strong.
Pierre Jay
J. H. Case
E. R. Kenzel
L. F. Sailer
G. L. Harrison...
Francis Oakey...
L. H. Hendricks.
H. A. Hopf
Shepard Morgan.
E.H. Hart
A.W. Gilbart....
J. D. Higgins
J.W.Jones
L. R. Rounds
J.L.Morris
Carl Snyder
W. B. Matteson..
A. J. Lins
G. E. Chapin
H. M. Jefferson...
J. E. Crane
W.A.Hamilton.
R. M. O'Hara....
Salary prior
to Federal
reserve
bank employment.
i $60,000
116,500
20,000
3,000
6,500
210,000
20,000
9,500
20,000
7,500
2 4,800
3,000
3,000
2,600
2,800
12,500
10,000
2,200
1,320
3,000
3,000
1,320
4,000
3,500
Initial
salary.
$30,000
16,000
25,000
4,200
10,000
22,000
20,000
6,000
3 7,000
11,000
12,000
2,400
3,000
4,800
2,400
9,000
10,000
2,400
1,500
3,600
3,500
1,080
2,400
3,000
Present
salary.
$50,000
30,000
30,000
22,000
30,000
25,000
20,000
18,000
18,000
15,000
15,000
12,500
12,000
10,000
12,500
12,000
10,000
10,000
10,000
10,000
8,000
7,500
7,000
8,400
Increase
Increase
since em- since made
ployment. officer.
Per cent.
66.0
87.5
20.0
423.8
200.0
13.6
Per cent.
66.0
87.5
20.0
423.8
200.0
13.6
200.0
200.0
36.4
25.0
420. 8
300.0
108.3
420.8
33.3
247.2
140.0
108.3
247.2
316.6
566.6
177.7
128.5
594.5
191.6
180.0
150.0
316.6
108.3
128.5
108.3
75.0
40.0
Years in
Federal
reserve
bank.
1
Includes bonus and directors' and committee fees.
«Federal Government service.
»Half time.
This table illustrates the cases of those officers of the bank whose salaries are specifically criticized by Mr. Williams, and accounts in part for the increase in the total
official salary roll from $93,000 in 1916 to $400,000 in 1920. But the real explanation
of that increase is attributed, not so much to individual increases as to the extraordinary growth in the work of the bank, resulting in consequent additions both to the
number of employees and officers. It has always been the policy of the bank wherever
possible to fill new offices or vacancies by promoting those in its service, whether
they be employees or officers. Thirteen of the 24 men listed above entered the employ
of the bank as clerks and at relatively small salaries, so that their present salaries as
responsible officers of the largest bank in the country may seem large as compared
with their initial salary in a newly organized institution with relatively little business.
Owing, however, to the rapid increases in the bank's business and the increasing
necessity for additional employees and officers, the promotion of those in the service
was at times rapid, but it is believed that no promotion was ever made that was not
fully merited in the circumstances. An examination of the percentage of increase
in individual salaries will show that the greatest increase was in those cases where
the officers started in the employment of the bank as clerks. The percentage of
increase in official salaries as such is relatively much less, and in those cases where it
seems large by way of percentage, it will be seen to have been spread over a number
of years. In order more clearly to explain these individual increases, it may be well
to read a chart by years showing the number of officers in the service of the bank on
the first of each year, their aggregate salaries, and the general average of all official
salaries, together with the proportion of officers to employees in each year.
116
EXPENSES OF FEDERAL RESERVE BANKS.
Number of Aggregate
official
officers.
salaries.
Jan.
Jan.
Jan.
Jan.
Jan.
Jan.
Jan,
Oct.
1,1915
1,1916 .
1,1917
1,1918
1,1919
1,1920
1, 1921
1, 1921
*
5
7
9
16
27
30
34
37
$65,700
83,000
116,200
185,200
303,700
387,100
456,400
493,900
Average
official
salaries.
$13,140
11,857
12,911
11,575
11,248
12,903
13 423
13,349
Ratio of
officers to
employees.
lto 7
1 to 10
l t o 18
l t o 51
l t o 97
l t o 92
1 to 80
l t o 75
NOTE BY FEDERAL RESERVE BOARD.—Figures given in the above table are based on the bank's records
as of January 1 of each year and include the salary increases effective as of January 1 and the changes in
the number of officers effective as of the first of the year, whereas figures given in the Federal Reserve
Board's statement represent the number of officers and their aggregate annual salaries as of December
31 of each year before the above changes took place. Officers of the Buffalo branch are included in the
board's figures but not in the bank's figures.
This table speaks for itself. As already pointed out, the work of the bank from the
year 1915 through the year 1920 increased 64 times; the number of employees increased
31 times; the number of officers increased 6 times; but during the same period the
employees' salary roll has increased 49 times and the officers' salary roll 5 times—n«o. where near in proportion to the growth of the work in the bank. Furthermore, in
spite of the necessary increase in the aggregate of the bank's official pay roll, it should
be pointed out in this case, as in the case of employees, how relatively steady has
been the average official salary except for the increase heretofore discussed that took
place in 1920. Since January, 1920, the average salary has remained fairly constant at
a little over $13,000.
The last column of the table submitted above also bears an important relation to
this discussion; that is, the number of employees as compared to the number of officers in the bank. Our investigations have shown that, based upon figures compiled as
of October 1,1920, the Federal Reserve Bank of New York had fewer officers in comparison to the number of employees than any of the other Federal reserve banks;
that is, 1 officer to each 80 employees. In the case of the other reserve banks the
proportion ranges from 1 officer to 65 employees all the way down to 1 officer for each
21 employees. From the tables submitted herewith it will also be seen that while the
Federal Reserve Bank of New York has only 1 officer to 80 employees, the other
New York City banks which were investigated ranged from 1 officer to 57 employees,
the smallest percentage, to 1 officer for each 14 employees, the largest percentage.
The records submitted will also, upon examination, disclose the fact that while
the officers' salaries in the Federal Reserve Bank of New York is 0.024 per cent of the
total resources of the bank only one other Federal reserve bank has a lower ratio \>i officers' salaries to total resources, and that is in the case of the Federal Reserve Bank of
Boston, where it is 0.023 per cent. The ratio in the case of the Federal Reserve Bank
of Chicago is the same as that in New York, and in all other Federal reserve banks it is
higher, running up to a percentage of 0.074 per cent in the case of one reserve bank.
In other.words, the percentage of officers' salaries to total resources of the Federal
Reserve Bank of New York is not only next to the lowest in the whole system, but is
only about one-third of the highest of the system. A similar comparison with seven
of the largest New York City banks and trust companies is even more favorable to
the reserve bank, since the percentages of salaries to total resources in the case of
those city banks range from 0.07 per cent, the lowest (which is about three times our
percentage) to a maximum of 0.36 per cent, which is approximately 15 times that of the
Federal Reserve Bank of New York. The chart showing the percentage of total pay
roll represented by the officers' salaries is also most favorable to the New York bank.
The Federal Reserve Banks of New York and Kansas City pay 9.5 per cent of their
total pay roll to officers. These are the lowest percentages in the Federal reserve
system; the others range from 10.5 per cent to as high as 19.1 per cent, or twice the
proportion that is paid in New York. In the case of the New York City banks the
officers' salaries range from 20 per cent to 38 per cent of the total pay roll; that is,
from twice as much to over four times as much as the percentage in the case of the
Federal Reserve Bank of New York.
While it is not practicable to attempt to review the reasons for the increase in the
individual salaries for each of the officers on the pay roll, I shall discuss some of those
salaries in detail, inasmuch as they are repeatedly compared with the salaries of the
President of the United States, the Vice President, Senators, and members of the
Cabinet.
EXPENSES OF FEDERAL RESERVE BANKS.
117
Mr. Jay, Federal reserve agent and chairman of the board of directors, receives
$30,000 a year; but as his salary is fixed by the Federal Reserve Board and not by the
directors of the bank, I shall make no further mention of it at this time.
The salary of one of our four deputy governors is now $30,000. Our directors
recommended that it be increased to $40,000 on January 1, 1921, but the recommendation was not approved by the Federal Reserve Board. The officer of the bank to
whom I refer, within the past six months, has declined an offer of $55,000 a year to
become vice president of one of the largest national banks in New York City. He
has had other offers almost, if not quite, as attractive, which he has likewise declined.
Another deputy governor, who has been with the bank since its organization,
receives $30,000, recently increased from $25,000. He has declined an offer of
$38,500 a year from one of the largest national banks in New York City, and has
received other offers, but states that he prefers for the present to remain in the service
of the bank.
Another deputy governor of the bank whose salary was increased within the last
few months from $22,000 to $25,000 has a position awaiting him in New York at any
time he cares to take it with one of the largest and most prosperous national banks,
and at a larger salary than he now receives from the Federal reserve bank.
Another of the deputy governors, who receives a salary of $22,000 (increased last
January from $18,000), has declined at least one offer of an important position at a
salary of $25,000, and with a brilliant prospect of advancement.
I have mentioned these few instances to illustrate what has taken place with respect
to almost every important officer of the bank and to emphasize the fact that we are
laboring in a competitive market in which the demand for services of men of exceptional ability is intense. In fact, most of the important officers of the bank have
received and declined attractive offers at salaries in excess of those which they now
receive from the bank. It is necessary, therefore, that the bank, in order to retain
the services of men of ability, essential to the successful conduct of the business of
a bank with resources exceeding $1,500,000,000 and doing a business of many billions
of dollars a year, pay salaries somewhat commensurate with, even if not equal, to the
market value of their services. These men have devoted themselves without reservation, without sparing their health, frequently without vacation, and without
regard to hours of service or compensation, to the service of their Government during
the war and to the service of their country in building up the Federal reserve system
since the war ended. The charge that they are overpaid is wholly unfounded and
ill-becoming one who it is understood has himself approved of a great percentage of
the increases which he now attacks. The board is, of course, familiar with and
might deem it proper in view of this letter to furnish a summary of the votes cast
by Mr. Williams with respect to these increases.
In summarizing this discussion of the question of officers' salaries it appears—
(1) That while the bank's volume of work from the year 1915 through 1920 has
increased 64 times, and the number of employees has increased 38 times, nevertheless, the number of officers has increased only 6 times.
(2) That the average salary of all officers has remained extraordinarily constant
around $13,000.
(3) That the proportion of officers to employees (1 to 80) is less than that obtaining
in any of the other Federal reserve banks, which range from 1 to 65, the lowest, to
1 to 21, the highest, and smaller than the proportion of officers to employees in eight
of the largest commercial banks in New York City, which range from 1 to 57 to 1 to 14.
(4) That the proportion of officers' salaries to total resources in the Federal Reserve
Bank of New York (0.024 per cent) is smaller than in any of the other Federal reserve
banks except one, which is 0.023 per cent, the others running as high as 0.074 per
cent, and it is also smaller than the proportion of officers' salaries to total resources
in seven of the largest commercial banks in New York City, which range from 0.07
per cent, the lowest, to 0.36 per cent, the highest.
(5) That the proportion of officers' salaries to the total pay roll of the Federal Reserve
Bank of New York (9.5 per cent) is smaller than that in any of the other Federal
reserve banks except one, which is precisely the same, the others ranging from 10.5
per cent to as high as 19.1 per cent, and it is also smaller than the proportion of officers' salaries to the total pay roll of seven of the largest commercial banks in New
York City, wnich range from 20 per cent to 38 per cent.
Before finally passing from this subject there are several incidental points emphasized at much length in public discussions by Mr. Williams, to which reference might
be made.
First. Mr. Williams sa>s that he had "been told " that 60 per cent of the 24 officers
to whom he referred never received over $1,500 to $2,500 before thev came to the
reserve bank and stated that they are now receiving salaries as high as Cabinet officers.
118
EXPENSES OF FEDERAL RESERVE BANKS.
An examination of the table heretofore submitted will indicate that of the officers
mentioned precisely three received less than $2,500 prior to their employment by
the Federal reserve bank—that is, one-eighth, or 12£ per cent, and not 60 per cent—
and of those three not one is receiving a salary as high as a cabinet officer. This is
simply another instance where Mr. Williams, either through a lack of information
or through intentional deception, distorts the facts to suit his own purposes. While
it may be that he "had been told" that 60 per cent of these officers never received
over $1,500 to $2,500 before they came to the Federal reserve bank, he must have
known that his informant lacked, that authoritative knowledge that is usually an
essential prerequisite to such a public statement of abuse.
Second. A majority of Mr. Williams's criticisms of the salary policy of the bank
take the form of comparisons between the official salaries at the bank and the salaries
of certain governmental officers, such as the President, the Vice President, members
of the cabinet, and Senators. As has been ably stated by a prominent ex-member
of the Federal Reserve Board, salaries of officers of Federal reserve banks should not
be considered in relation to the salaries of high Government officials, since the "heads
of Federal reserve banks could not be said to enjoy that magnitude of power and
prestige pertaining to high Government office," and since the reserve officers are also
"placed in a different position from those engaged in prrvate institutions in that they
were affected by the mutations of public life and controlled by a changing public
board."
The fact that the Government can not for various reasons pay to its higher executive officers salaries comparable to the executive salaries of private corporations is
no£ $ sound logical argument against the payment of proper salaries to the officers of
banking corporations chartered under Federal law, which have to compete for personal services in a market with other private banking institutions.
Third. So far as the particular charge that employes of the reserve bank receive
more than $5 a day while traveling on official business of the bank is concerned, I can
only say that the expenses of any person traveling for the bank or anyone else in these
days are often in excess of $5 per day, and that there is no reason in justice that they
should not be reimbursed for their actual and reasonable traveling expenses. It is
unnecessary, however, to state that a careful watch is kept over the individual expense
accounts of employees and officers by the officers themselves, by the auditing department of the bank, and by the examiners of the Federal Reserve Board in order that
items not reasonably a part of one's traveling expenses might not be contained in any
expense voucher.
Fourth. Mr. Williams comments that "it also seems to me ridiculous for a reserve
bank to employ at a salary exceeding that paid to a United States Senator or the
editor-in-chief of many important newspapers in big cities, a man for whose employment an urgent argument was made by the reserve bank employing him that he was
needed to touch up and give literary style to the press statements which the bank
had occasion to give out from time to time, although high-priced men were already
employed in the bank's publicity department who were supposed to be fully competent for such work."
NOTE BY FEDERAL RESERVE BOARD.—On page 45 of part 13 of the hearings before the Joint Com-
mission of Agricultural Inquiry, Mr. Williams stated: "It also seems to me ridiculous for a reserve bank
to employ at a salary exceeding that paid to an United States Senator or to the editor-in-chief of many
important newspapers in big cities, a man for whose employment an urgent argument was made by the
reserve bank employing him that he was needed to touch up and give literary style to the press statements which the bank had occasion to give out from time to time, although high-priced men were already
employed in the bank's publicity department who were supposed to be fully competent for such work."
In a letter addressed by him to Chairman Anderson of the commission, under date of October 17,1921, he
says: " I do not think—and so expressed myself at the time—that it is in accord with the principle of administration of government at the lowest possible cost to the people to pay a man with no claim to banking
knowledge $12,000 a year, the salary of a Cabinet officer, to put literary finish on the public outgivings of
the New York Reserve Bank."
On November 16,1920, the Federal Reserve Board received a letter, dated November 15, from the chairman of the board of directors of the Federal Reserve Bank of New York requesting its approval of the employment of Mr. W. Randolph Burgess as chief of the division of reports, statistical department of the
Federal Reserve Bank of New York, at an annual salary of $4,500. In the letter referred to the chairman
stated: "I have felt for some time that we needed the right sort of man to study the texts of our reports,
particularly the monthly report and the annual report, so that the conditions of good English and conservative and consistent statement could be met. We have found a man who seems admirably fitted by experience and temperament to comply with these qualifications, and at a salary which is by no means excessive. The managing committee and the executive committee both acted favorably upon the recommendationapproved by me, for the employment of W. Randolph Burgess as chief of the division of reports,
statistics department, at $4,500 a year/'
I deny categorically that the Federal Reserve Bank of New York has now, or ever
has had, a publicity department. There is issued once a month a " Monthly review
of credit and business conditions in the second Federal reserve district" under the
direction of Mr. Jay, chairman of the board of directors and Federal reserve agent.
This review is a pamphlet of about 10 or 12 pages and is reputed to be one of the most
EXPENSES OF FEDERAL RESERVE BANKS.
119
valuable compilations of current business conditions that is prepared for the use of
manufacturers, business men and bankers within the district. I submit that the
effort and expense incident to its preparation and issue can not be charged "unjustified" or "extravagant."
The bank engages in no other form of publicity and can not be subjected to a charge
of indulging in any kind of propaganda. Such a statement is wholly unfounded and
the author knows it to be so. It might even be commented that the bank has at times
been severly critized because it has failed to take steps to educate the public by circulars, articles, or even "propaganda, " if that is the proper word; to "advise the public
of the scope and purpose of the system in order that a more complete knowledge of
functions on the part of the public might itself be the best answer to the vicious and
false criticism of such opponents as Mr. Williams has himself proved to be.
Fifth. The charge is also made that "the expense allowance of officers and employees,
including bank examiners, of the Federal reserve banks are practically unlimited,"
although cabinet officers and other high officials of the Government, and national
bank examiners, are limited in their expenses to $5 per day," and that "an inspection
of some of the expense accounts of the Federal reserve banks would be decidedly
edifying to a congressional committee if they should be looked into."
For the information of the board, I wish to say that at the time of my appearance
before the Joint Commission of Agricultural Inquiry, I showed to the chairman of
that commission a copy of the complete expense account of the Federal Reserve Bank
of New York since its organization, and, as I stated to him then, I am prepared and
anxious at any time to present it to the commission or, in fact, to any committee of
Congress which may see fit to interest itself in the matter, with the assurance that a
careful and critical inspection of it will only be conclusive of the care and conservatism with which it is administered, It is, of course, available at any time for the
inspection of the Federal Reserve Board. For the further information of the board,
I wish briefly to review the steps which have been taken at various times by the bank
officers with a view to maintaining a careful and effective control over the expense
account.
Shortly after the war it was realized that the work of the bank had developed more
rapidly than its organization, and after a careful study by the officers and directors a
new plan of organization was made effective on September 1, 1919, definitely fixing
the responsibility of each officer of the bank and placing each department of the bank's
activity under the direct charge of an officer responsible for its efficient operation.
A monthly record was established for each department of the bank, showing the
number of employees engaged and the expense incurred. These figures have been
carefully analyzed to ascertain whether the increased expenses were warranted.
Coincident with the development of the new organization there was created the
administration function which was charged with the responsibility of engaging all
new employees, after fully satisfying itself that such employees were actually required
because of increased work. This department is also charged with the responsibility
of properly placing the employees and of shifting them from one department to
another as the occasion may require.
Under the new plan of organization there was also created the methods and supplies
department for the purpose of more efficiently controlling expenses by the establishment of a centralized authority over the ordering of all supplies and equipment and
also over changes in the mechanical operation of the various departments. No purchases are made by the purchasing agent unless the requisition bears the vise of this
department. Many economies resulted from the establishment of this department
such as: First, the installation of air-drying equipment in wash rooms replacing the
linen and paper towels formerly used; second, the establishment of the post-office
station and elimination of the express charges on shipments of currency and securities.
The printed forms have been standardized as to size and style and the number of
forms in use reduced, effecting very considerable savings in the use of paper. The
work of this department has resulted in a large number of other economies of this
character.
It was deemed advisable in the latter part of 1920 to make a more intensive study
of each department in the bank and the managing committee therefore established
the procedure committee for this purpose, composed of three of the senior officers of
the bank, to actively engage in this work for the purpose of simplifying the operations
of each department, eliminating unnecessary effort and expense, so that the work of
the bank will be accomplished at the lowest cost consistent with safety and efficiency
of operation. This committee has already completed the study of some three or four
departments, and it is expected that a very considerable saving in operation will result
from the recommendations made by the committee.
120
EXPENSES OF FEDERAL RESERVE BANKS.
The current expense account has been constantly under close scrutiny by the
directors and senior officers of the bank. Department heads and chiefs have been
cautioned that no expenses are to be incurred except for the purpose of securing
greater efficiency of operation. Department heads have been called together in
meetings, the situation thoroughly canvassed, and managers and controllers were
requested by the governor to advise him what economies have been effected in their
respective departments. In this way the necessity of economical and efficient operation of the bank has been impressed upon those in charge of operations.
Every purchase* requisition or current-expense voucher requires the approval of an
officer of the bank, and if the amount is more than $100 the approval must be that of
a senior or general officer
Any division requiring equipment, printed forms, supplies, or services of any kind
is required to prepare a purchase-order requisition. All requisitions, regardless of
prior approval, are routed to the planning division of the methods and supplies
department for vise*:
First, as to the necessity of the purchase. Second, as to the standard. Third, as
to the quantity. Fourth, in the case of "rush " requisitions, whether or not the necessity warrants the incurring of any additional expense.
Such requisitions as are approved are then routed to the purchasing division where
actual purchase is negotiated. In the case of all purchases of any consequence, bids
are secured from several different suppliers or manufacturers, after which orders are
placed based upon bids received.
The expense division receives all invoices and makes a complete examination to
determine that the bill is regular in every way, that the material or service invoiced
has been received, that the price appears to be reasonable, and that the charge is a
proper one for the bank to pay. In this way there is secured first, a vise of all requisitions before purchase, and, second, a review of all bills rendered before payment,
this review acting as a check upon the first vise as well as upon the purchasing agent.
No member of the organization is permitted to make any purchase or incur any expense except through the regular channels specified above.
All divisions are supplied with stationery and supply cabinets in charge of a supply
clerk who is permitted to requisition only such supplies as are actuajly necessary for
the work of the bank.
Monthly departmental expense reports are prepared giving a comparison of the
expe/nses for the month and the period this year with last, and all officers have been
urged to do everything possible to hold down the expense account, not only in the
usage of equipment, supplies, etc., but also in the use of the labor element, so that the
expansion of the force may be held at the lowest possible minimum.
- Special meetings of all of the officers of the bank were called on June 13 and
September 16, 1921, particularly to review the expense of each department of the
bank and to have each officer report all actions taken and proposed by his department
to effect further ecomomies in operation. For the information of the board I am
inclosing a copy of a report of those meetings which is in itself illuminative not only
of the care with which all of the officers watch the expense account, but also of the
actual reduction in the cost of operation in proportion to the volume of work done.
Before concluding, it seems necessary briefly to comment upon the limitations and
character of the the service and compensation of an officer of a Federal reserve bank.
As is well known, the salaries of all officers and employees of Federal reserve banks
(with the exception of the Federal reserve agent) are fixed by the directors of each
bank, subject to the approval of the Federal Reserve Board as required by the Federal
reserve act. Every salary now paid by the Federal Reserve Bank of New York has
been passed upon by a committee of the directors, approved by the directors of the
bank, submitted to the Federal Reserve Board for approval, and all approved salaries
finally reported to Congress. The assertion that the salaries paid are too large has
already been discussed in detail, but it may be proper to mention our understanding
of the principles which underlie the salary policy of the bank. It is, I believe, no
different from that prevailing in the system as a whole.
When the present officers of the Federal reserve bank were engaged, and all of them
have been engaged since I became the governor of the bank, they were told that their
sole ©pportunities in the bank were for advancement in the service of the bank, for
earning larger salaries, and for making successful banking careers, and that if they
displayed satisfactory ability it would be the policy of the bank to enlarge the staff
as the business grew by promotion rather than by getting men from outside. This
policy has been pursued as fully as possible, although not in every instance, because
the growth of the bank has been so rapid as to make it necessary at times to draw men
from other sources than our own organization.
EXPENSES OF FEDERAL RESERVE BANKS.
121
The conduct of the business of a bank such as the Federal Reserve Bank of New
York, with transactions man^ times exceeding those of the largest banks in the country,
with great responsibilities to its member banks, to the public, and to the Treasury of
the United States, requires services of men of a high degree of skill who are willing to
devote all of their time to the bank not only in the ordinary routine in the day's work
but in study and acquiring knowledge of a great variety of technical subjects, and who
•can be relied upon at all times to show breadth of judgment, untiring effort, and
unselfish loyalty.
They are not permitted to engage in any kind of commercial or political activities,
to hold public office, or to make their service in the Federal reserve bank a stepping
stone to a political career or a means of financial profit. In short, they are bank
officers like the officers of any other banking institution whose duty it is to serve the
bank wholeheartedly and singly for a salary, but who, unlike the officers in other
banking institutions, must do so without the possibility of any other profit in either
a commercial or political sense. In fact, the regulations of the Federal Reserve Board
expressly provide that no officer of a Federal reserve bank shall hold any public or
political office during his term of service with the bank, and the rules of the Federal
Reserve Bank of New York itself prohibit any officer or employee from engaging in
any kind of business or commercial enterprise for profit.
It is apparent, therefore, that comparison of the salaries paid to these officers with
those received by public officials is not only misleading but calculated to obscure the
real problem with which the management of the reserve banks are faced. Men who
-enter public life do so with the knowledge that they abandon the rewards of business
for the rewards and prestige afforded by a political career, although it is true that
Members of Congress and many other political officers are not necessarily denied the
pursuit of other business occupations for profit.
Under all these conditions it would be impossible to procure services of men of the
ability required by the Federal reserve banks, men precluded from the possibility of
profit other than their salaries, if their salaries are to be limited or measured by the
salaries paid to the political officers of the Government. In order to retain such men
in the service of the Federal reserve system it is essential that the Federal reserve
banks be able to pay salaries fairly commensurate with, though not necessarily as
high as, the standard of salaries fixed by the competitive demands of other private
banking institutions located in the same vicinity.
It has been the purpose of this letter to submit facts and figures which it is believed
will be convincing that the salaries in the Federal Reserve Bank of New York are
not only not extravagantly high, as has been asserted, but are much lower than the
general level of salaries for similar services in the community.
Very truly, yours,
BENJ. STRONG, Governor.
LIST OF INCLOSTJRES CONTAINED IN LETTER OF OCTOBER 6, 1921, GOV.
STRONG TO GOV. HARDING.
1. A chart of wholesale commodity prices in four countries.
2. A chart comparing wholesale commodity prices and the cost of
living.
3. A chart comparing New York factory workers' earnings,
Federal reserve bank employees7 salaries (with and without bonus),
cost of living in New York, and cost of living in the United States.
4. A table showing the number of employees, amount of pay roll;
average salary, and extra compensation.
5. A list of all officers showing initial salary, present salary, number of years with bank, and other data.
6. Tables comparing—
(a) Percentage of officers7 salaries to total resources in New
York Reserve Bank with other reserve banks and certain
New York City banks.
(6) Percentage of officers7 salaries to total pay roll in New York
Reserve Bank with other reserve banks and with certain
New York City banks.
122
EXPENSES OF FEDERAL RESERVE BANKS.
(c) Number of officers to employees in the New York Reserve
Bank with other reserve banks and with certain New
York City banks.
7. A report of a meeting of the officers of the Federal Reserve Bank
of New York concerning the control of expense.
8. A table showing the percentage of increase in volume of business, in the number of employees, and in expense (with supporting
tables). 1
50
1915
19)6
1917
1918
1919
1920
1921
Earnings of factory workers in New York State, the cost of living, and average salaries of employees
of the Federal Reserve Bank of New York. (Figures for December, 1914=100 per cent.)
1
Printed as part of Exhibit C (pages 38-44).
EXPENSES OF FEDERAL RESERVE BANKS.
123
WHOLESALE PRICES
PERCENT
FOUR COUNTRIES
700
124
EXPENSES OF FEDERAL. RESERVE BANKS.
PER CENT.
300
\
WH )LE: >AL
PR CE
\ ^> ^
200
{
—**>
r
/
r
\
/
/
/
CO 3T OF LI riN 3
100
1916
1917
1918
1919
1920
1921
Wholesale prices and the cost of living expressed as percentages of figures July, 1914.
Table showing the number of employees, amount of pay roll, average salary, and extra compensation of the Federal Reserve Bank of New York (exclusive
of Buffalo branch).
Number of employees.
Men.
Jan.
Women.
Amount of
increase.
Total.
1,1915
36
Jan. 1,1916
June 1,1916
71
85
Jan.
1,1917
164
July
Jan.
July
Jan.
1,1917
1,1918
1,1918
1,1919
$1,334.00
1,211.00
1,125.00
7,268.00
160,460.00
978.00
8,640.00
53,876.00
70,218.00
143,720.00
242,244.00
844.00
1,281
1,391
1,312
1,356
Jan. 1,1920
Jan. 31,1920
Feb. 29,1920
Mar. 31,1920
1,437
1,464
1,483
1,486
1,331
1,326
1,332
1,325
2,768
2,790
2,815
2,811
665,321.00
Apr.
May
June
July
Aug.
Sept.
Oct.
Nov.
Dec.
Jan.
Feb.
Mar.
Apr.
May
June
July
1,479
1,463
1,478
1,490
1,462
1,440
1,440
1,450
1,511
1,490
1,494
1,505
1,568
1,610
1,645
1,666
1,303
1,283
1,264
1,260
1,241
1,244
1,241
1,249
1,263
1,244
1,231
1,228
1,254
1,246
1,261
1,250
2,782
2,746
2,742
2,750
2,703
2,684
2,681
2,699
2,774
2,734
2,725
2,732
2,822
2,856
2,906
2,916
4,420.00
3,760.00
3,540.00
17,240.00
13,760.00
11,700.00
29,500.00
19,360.00
16,460.00
23,840.00
10,790.00
16,320.00
15,280.00
21,400.00
20,120.00
22,420.00
Average salaries (not
including extra compensation).
Men.
85,987.00
95,640.00
$7,437.00
15,120.00
July 31,1919
Oct. 31,1919
General
average
salary.
$48,014.00
287
814
1,339
2,630
2,593 254,440.00
2,747 17,700.00
30,1920
31,1920
30,1920
31,1920
31,1920
30,1920
31,1920
30,1920
31,1920
1,1921
1,1921
1,1921
1,1921
1,1921
1,1921
1,1921
Total annual
pay roll
(exclusive
of officers).
Women.
Amount.
Per cent.
f 10 per cent on salaries up to and including $1,200; 1\ per
on salaries from $1,200 up to and including
$9,387.50 II cent
$3,000; 5 per cent on salaries over $3,000, except govl ernor, deputy governors, and Federal reserve agent.
20 per cent up to $1,200; 15 per cent, $1,201 to $3,000; 10
47,489.05 \ per cent, $3,001 to $7,200.
115 per cent less than $1,500; 10 per cent, $1,500 to $5,000.
|
Do.
} 423,075.81 -{25 per cent up to $1,500; 20 per cent, $1,501 to $3,000; 15
I per cent, $3,001 to $5,000.
853,256.00
1,290,944.00
3,007,550.00
1,048. 00
964.00
1,144.00
3,069,233.00
3,306,511.00
1,184.00
1,204.00
$1,474.00
1,479.00
$900.00
924.00
3,965,660.00
3,972,240.00
3,986,080.00
3,988,480.00
1,433. 00
1,424.00
1,416.00
1,418.00
1,690.00
1,678.00
1,681.00
1,129.00
1,124.00
1,123.00
3,963,220.00
3,926,360.00
3,913,920.00
3,941,510.00
3,906,670.00
3,893,590.00
3,908,390.00
3,943,770.00
4,083,723.00
4,056,783.00
4,063,393.00
4,068,823.00
4,172,063.00
4,230,343.00
4,296,623.00
4,331,143.00
1,425.00
1,429. 00
1,427.00
1,433.00
1,445. 00
1,452.00
1,457.00
1,461. 00
1,472.00
1,484.00
1,491.00
1,490.00
1,478.00
1,481.00
1,479.00
1,485. 00
1,688.00
1,696.00
1,683.00
1,701.00
1,720.00
1,737.00
1,747.00
1,750.00
1,758.00
1,768.00
1,783.00
1,773.00
1,744.00
1,740.00
1,733.00
1,733.00
1,125.00
1,126.00
1,126.00
1,117.00
1,122.00
1,121.00
1,121.00
1,125.00
1,129.00
1,133.00
1,137.00
1,222.00
1,139.00
1,146.00
1,147.00
1,156.00
i Effective July 1,1916.
Extra compensation.
per cent up to $1,500; 20 per cent, $1,501 to $3,000; 15
248,072.00 25per
$3,001 to $5,000.
186,824.00 2 50 percent
cent up t J $1,500; 40 per cent, $1,501 to $3,000;
2 392,362.00
25 per cent, $3,001 to $6,000.
184,648.00
20 per cent on first $1,500; 15 per cent on next $500; 10
per cent on next $500. No additional per cent on
amounts between $2,501 and $5,000.
182,140.00
Do.
179,451.00
Do.
184,532.00
Do.
187,290.00
Do.
" 97* 743." 66" 10 per cent on first $1,500; 1\ per cent on next $500; 5 pel
cent on next $500. No additional per cent on
amounts between $2,501 and $5,000.
a Dec. 31,1919.
fcO
List of officers, showing initial salary, present salary, number of years with bank, and other data—Federal Reserve Bank of New York.
Name and official title.
Previous experience.
Benjamin Strong,governor.
J. Herbert Case, deputy
governor.
Louis F. Sailer, deputy
governor.
Geo. L. Harrison, deputy
governor.
E. R. Kenzel, deputy governor.
D. H. Barrows, secretary..
President Bankers Trust Co
7 years vice president, Farmers Loan & Trust
"Co.
24 years with National Park Bank, New York,
assistant cashier.
26 years with Chemical National Bank (auditor).
2 years with Farmers Loan & Trust Co. (chief
clerk, corporate trust department).
E. H Hart, general counsel 2 vears attorney for Associated Railway and
Steamship Cos. in the South; 2 years in
United States Army (captain); 4 months
with American relief administration (American secretary to supreme economic council at
Paris); 7 months member war loan staff
Treasury Department, attached to office of
Assistant Secretary of Treasury Leffingwell.
Lucius R. Mason, assistant 6 years practicing attorney; 2 years special
attorney, Department of Justice, Washinggeneral counsel
ton, D. C. (salary and fees from private
pfactice).
Francis Oakey, acting gen- 12 years public accountant (income from practice).
eral auditor.
Harry A. Hopf, organiza- 15 years in life insurance (chief underwriter);
3 years industrial engineer (annual income).
tion counsel.
L. H. Hendricks, controller 19 years with Commercial National Bank of
Albany, assistant cashier; 10 years with
at large.
National State Bank of Albany (cashier);
2 years with National Nassau Bank of New
York (vice president).
Ray M. Gidney, controller 7 years' bank experience in California* 3 years
secretary to member of Federal Reserve
at large.
Board.
10
years with National Nassau Bank of New
A. W. Gilbart, controller of
York (cashier); 8 months with Irving Naadministration.
tional Bank of New York (assistant cashier).
Salary
previous
to entering employ
of bank.
$20,000
6,500
3,000
Initial
salary
with
bank.
$30,000
25,000
Salary
when
Present
appointed salary.
officer.
$30,000
25,000
$50,000
30,000
Increase
since,
entering
bank.
Time.
Per cent.
66.0 7years
20.0 4 years
Increase
since
appointment as
officer.
Per cent.
66.0 7 years.
20.0 4 years
10,000
10,000
30,000
200.0
6 years, 3 months.,
200.0
22,000
22,000
25,000
13.6
lyear, 3 m o n t h s . .
13.6
4,200
4,200
22,000
423.8
7years
Time.
423.8
6 years, 3 months.
1 year, 3 months.
7 years.
3,000
4,000
4,000
7,500
87.5
3 years, 7 months .
87.5
3 years, 7 months.
4,800
12,000
12,000
15,000
25.0
1 year, 6 m o n t h s . .
25.0
1 year, 6 months.
6,000
6,500
6,500
6,500
20,000
20,000
20,000
20,000
1 year, 10 months.
lyear, 10 months.
20,000
18,000
18,000
18,000
2 years, 5 months
2 years, 5 months.
9,500
6,000
6,000
18,000
200.0
7 years
200.0
2,500
4,000
4,500
15,000
275.0
4 years, 5 months..
233.33 3 years, 6 months.
3,000
2,400
3,600
12,500
420.8
7years
247.2
8 months.
9 months
7 years.
4 years, 3 months.
to
L. R. Rounds, controller of
accounts.
Jos. D. Higgins, controller
of cash and custodies.
J. W. Jones, controller of
fiscal agency function.
Jos. L. Morris, manager
credit department.
G. E. Chapin, manager
loan department.
2,800
2,400
3,600
12,500
420.8
4 years
247.2
3 years, 9 months.
3,000
3,000
5,000
12,000
300.0
7 years
140.0
2,600
4,800
4,800
10,000
108.3
3 years, 9months..
108.3
12,500
9,000
12,000
12,000
33.3
3,000
3,600
4,800
10,000
177.7
4 years,5months..
5 years.
3 years, 9 months.
6 months.
3 years, 9 months.
1,320
1,500
2,400
10,000
566.6
7 years.
4 years, 3 months.
2,200
2,400
4,000
10,000
316.6
10,000
10,000
10,000
10,000
3,500
3,000
6,000
8,400
180.0
4 years..
40.0
2 years.
3,000
3,500
3,500
8,000
128.5
7 years.,
128.5
7 years.
1,320
1,080
3,600
7,500
594.5
6 years.
108.3
1,800
2,250
4,000
7,200
220.0
7 years.
80.0
2 years, 9months.
3 years, 2 months.
2 years, 9 months.
9 months
do.
EXPE
7 yer.rs with Hiram Ricker & Sons, Portland,
"Me (accountant and office manager).
23 years with American Exchange National
Bank of New York (assistant to officers).
4 years manager Long Island City branch of
Broadway Trust Co.
9 years with Farmers Loan & Trust Co. (loaning officer and credit manager).
20 years with Westinghouse Electric & Manufacturing Co. (treasury accounting representative in charge of credits and collections; also
acting assistant treasurer Westinghouse Electric Export Co.)
Adolph J. Lins, manager at 9^ years with Bankers Trust Co. (assistant
large.
^manager, transfer and registration department).
W. B. Matteson, manager 15 years with National City Bank of New York
securities and certificates
(acting head securities department).
of indebtedness departments.
Carl Snyder, manager sta- 2 years with International Co. (business mantistics department.
ager, $15,000 plus royalties); 1 year with Encyclopedia Britannica (advertising manager,
$25,000); 1 year with Harper Bros, (editorial
director, $10,000 plus royalties).
R. M. O'Hara, manager 14 years with Canadian Bank of Commerce (acbill department.
countant); 5 years with Farmers Loan &
Trust Co. (auditor); 5 years with Chubb &
Sons (office superintendent).
H. M. Jefferson, manager 7 years with Chase National Bank; 1J years
personnel development
bank examiner State of New York; 3 |
department.
years with Bank of Coney Island (vice president and cashier); 1J years with Windsor
Trust Co. (secretary and treasurer).
Jay Crane, manager foreign 1 year on staff of editor of Commercial and Fidepartment.
nancial Chronicle.
I. W. Waters, manager per- 8 years with Gallatin National Bank, New
sonnel service departYork; 3 years with Hanover National Bank,
ment.
New York.
Chas. H. Coe, manager 20 years with National Nassau Bank (chief
check department.
clerk); 2 years with Irving National Bank.
Win. A. Hamilton, man- 6 years with J. P. Morgan & Co.; 3 years with
ager cash department.
Studebaker Corporation.
W. H. Dillistin, manager, 10 years with Silk City Trust Co., Paterson,
bank examinations deN. J.; 5 years with State of New Jersey (bank
partment.
examiner).
John Raasch, manager, 5 years with Liberty National Bank, New
methods and supplies de- York.
partment.
H. R. Murray
24 years with American Exchange National
bank.
3 years, 9 months.
Ul
1 year, 7 months.
o
Ul
1 year, 7 months.
2,200
1,500
4,000
7,200
380.0
5 years, 2 months..
80.0
4,000
2,400
4,000
7,000
191.6
4 years
75.0
Do.
3,800
4,500
5,000
6,600
46.6
3 years, 2 months..
32.0
2 years.
1,000
1,000
3,000
6,000
500.0
7 years
1,600
2,400
3,400
6,000
150.0
4 years, 2 months..
100.0
76.5
i
I
i
w
W
•
3 years, 2 months.
2 years.
to
List of officers, showing initial salary, present salary, number of years with bank, and other data—Federal Reserve Bank of New York.
00
Salary
previous
to entering employ
of bank.
Initial
salary
with
bank.
Salary
when
Present
appointed salary.
officer.
Increase
since
entering
bank.
Increase
appointment as
officer.
Time.
Name and official title.
Previous experience.
B. M. Grant, manager Government securities sales
department.
E. C. French, manager
custody department.
James Rice, manager Government-bond department.
S. S. Vansant, manager
discount department.
E. L. Dodge, manager auditing department.
Pierre Jay, Federal reserve
agent.
1 year with Alexander Brown & Co., Baltimore, Md.; 1 year with Liberty loan committee for Maryland.
16 years with National Nassau Bank; 3 years
with Irving National Bank (paying teller).
7 years with Ward Line (accountant)
2,400
2,700
3,000
6,000
2,500
3,000
4,800
6,000
100.0
4 years
25.0
1 year, 9 months.
1,700
1,800
4,500
5,500
205.5
do
22.2
1 year, 4 months.
11 years with Chemical National Bank
1,100
1,500
5,000
5,000
233.3 5 years, 7 months .
Shepard Morgan, assistant
Federal reserve agent.
16 years examiner and special deputy, New
York State banking department.
Commissioner of banking, State of Massachusetts; Bank of the Manhattan Co. (vice
president).
2£ years secretary to department of finance,
city of New York, $6,000; 14 months deputy
controller, city of New York.
Time.
Per cent.
122.2 3 years
Per cent.
100.0 2 year.
7 months.
4,200
5,000
6,500
6,500
30.0
1 year, 4 months.
16,500
16,000
16,000
30,000
87.5
7 years
87.5
7 years.
7,500
11,000
11,000
15,000
36.4
2 years, 2 months..
36.4
2 years, 2 months.
4,000
4,800
4,800
7,500
56.3
2 years
56.3
2 years.
2 years, 7 months..
41.2
9 months.
BUFFALO BRANCH.
W. W. Schneckenburger, 5 years with Wyoming County National Bank;
manager Buffalo branch.
5 years with Wyoming County Banking Co.;
and Pavilion Bamking Co. (cashier and
manager).
Halsey W. Snow, cashier 17 years with National Commercial Bank, Al(, assistant transit managerj.
Clifford Blakeslee, assist- 10 Dany
years with National Bank of Commerce,
ant cashier
Buffalo
Rochester (assistant cashier).
branch.
1,800
2,400
3,400
4,800
100.0
2,800
2,400
3,600
3,600
50.0
2 years, 4 months
1 year, 4 months.
4 months.
X
i
o
129
EXPENSES OF FEDERAL RESERVE BANKS.
' Percentage of officers1 salaries to total resources, Federal reserve banks (including branches).
Per cent.
Boston
0. 023
New York
024
Philadelphia
027
Cleveland
025
Richmond
046
Atlanta
047
Chicago
024
St. Louis
051
Minneapolis
050
Kansas City
042
Dallas
074
San Francisco
036
Officers' salaries for Philadelphia, St. Louis, and San Francisco are as of June 30,
1920, and were obtained from the cards sent in by the banks in connection with the
pension study.
The resource figures for these three banks are as of June 25, 1920, the nearest weekly
report date.
All other figures are as of December 30, 1920.
New York City banks.
Per cent.
Bank
Bank
Bank
Bank
Bank
Bank
Bank
1
2
3
4
5
6
7
0. 36
22
27
068
15
13
29
Percentage of total pay roll represented by officers' salaries.
Federal reserve banks.
Boston....
New York
Philadelphia i
Cleveland.
Richmond
Atlanta...
Chicago 1
St Louis
Minneapolis
Kansas City
Dallas
San Francisco1
Exclud- Including
ing
branches. branches.
11.0
9.5
10.9
11.7
15.5
19.1
10.5
12.8
9.5
14.9
11.1
. .
9 6
10.7
14.6
21.2
9.8
12.2
9.3
14.9
11.0
1
Total salaries for these banks were obtained from statements (as of Oct. 1, 1920, in the case of Philadelphia and St. Louis, and as of June 30.1920, in the case of San Francisco) sent in by the hanks in connection
with the pension study. Officers' salaries for these banks were obtained from the pension record cards and
are as of June 30,1920. Figures for the St. Louis bank, exclusive of branches, are not available.
Figures for all banks except those marked i are as of December 31,1920.
New York City banks.2
Per cent.
Bank
Bank
Bank
Bank
Bank
Bank
Bank
2
1
2
3
4
5
6
7
25
21$
38
20
30
33J
32
Figures as of Jan. 1,1921.
S. Doc. 75, 67-1
9
130
EXPENSES OF FEDERAL, RESERVE BANKS.
Comparative statement showing ratio of officers to employees in Federal reserve bank.
Bank.
B oston
New York
Philadelphia 1
Cleveland
Richmond
Atlanta
Chicago
St. Louis**
Minneapolis
Kansas City
Dallas
San Francisco 12
Representative New York City banks: 3
Bankl
Bank2
Bank3
Bank4
Bank5
B ank 6
Bank7
Bank8
Number Number
of emof
ployees. officers.
763
2,734
851
628
474
273
1,262
877
447
529
460
1,015
13
34
13
14
13
13
36
22
12
12
15
34
4,259
3 222
'946
726
1,093
490
1,054
938
74
122
32
14
37
20
73
26
Ratio of officers to
employees.
1 officer
1 officer
1 officer
1 officer
1 officer
1 officer
1 officer
1 officer
1 officer
1 officer
1 officer
1 officer
to
to
to
to
to
to
to
to
to
to
to
to
58 employees.
80 employees.
65 employees.
44 employees.
36 employees.
21 employees.
35 employees.
39 employees.
37 employees.
44 employees.
30 employees.
29 employees.
1
1
1
1
1
1
1
1
to
to
to
to
to
to
to
to
57 employees.
26 employees.
29 employees.
51 employees.
29 employees.
24 employees.
14 employees.
36 employees.
officer
officer
officer
officer
officer
officer
officer
officer
1 Figures for these banks were obtained either from (a) figures compiled by the several banks as of Oct.
1,1920, for the pension study or (6) figures sent in by the banks in connection with the personnel study.
In all cases the larger of these two figures has been used.
2 Figures for St. Louis and San Francisco include branches. Branches are not included in the case of
other
banks.
8
Figures as of last week of December, 1920, or first week of January, 1921.
MEETING OF OFFICERS IN RESPECT TO CONTROL OF EXPENSES.
On June 13 a special meeting of officers was held, called by Gov. Strong, at which
the subject of controlling the expenses of the bank was discussed and certain instructions and suggestions were given by Gov. Strong to those present.
On September 16 a second special meeting of officers was held, called by Gov. Strong,
for the purpose of giving the officers an opportunity to report the progress made and
the plans formulated pursuant to carrying out the instructions given at the first
meeting.
Every department of the bank was represented and each officer made a report
stating the methods followed in controlling expenditures and specifying economies
that had been effected as compared with the expenses for the years 1919 and 1920
and outlining the plans that had been formulated toward further economies that
might be effected without sacrificing safety, efficiency, and service to member banks.
Special consideration was given to the following subjects:
(a) Controlling expenditures for supplies, material, and equipments; first, through
the authority oi approval or disapproval of requisitions vested in controllers and
managers, and, second, by the final examination given to all requisitions by the
department of methods and supplies.
(6) Controlling expenditures for salaries; first, by the consideration of work requirements on the part of managers and, second, by the transfer of employees from departments from which they can be spared to departments in which the volume of work
has increased, thereby avoiding additions to the total force of the bank, and, third,
by surveys of departments by the committee on procedure, in order to obtain an,
independent opinion as to the number of persons required.
(c) The making of a special study of statements and reports prepared, with a view
to reducing to a minimum the number prepared; first, by eliminating those which do
not contain information of vital importance and, second, by consolidating and standardizing those which are deemed to be essential.
(d) Controlling the cost of electric light by constant care on the part of the operating
officers and chiefs of divisions and also by independent inspection of the bank's
premises.
At the close of the meeting Gov. Strong informed the officers that a subsequent
meeting would be held, approximately three months from September 16, for reconsidering the subject of controlling the expense account of the bank, with particular
reference to the progress made in carrying out plans for effecting further economies.
EXPENSES OF FEDERAL RESERVE BANKS.
131
A schedule based on the reports made is attached hereto, showing the economies
effected by certain departments during the first six months of 1921, as compared with
the expenses of operation for the years 1919 and 1920. The departments that do not
appear in the schedule are those which did not report specific savings; in some of
these, such as the legal, foreign, and investment departments, material savings probably can not be made; in others, such as the cash department, the volume ofcwork
has greatly increased.
Plans for effecting economies in the near future are outlined in several of the reports.
Discount department—Loan function.
Salaries, month of December, 1920
Salaries, month of August, 1921
$14,344. 02
11,828. 88
Monthly savings
Annual saving
2,515.14
30,181. 68
Check department—Collection
function.
Transit division.—While the total cost of the transit division has increased each
year, the unit cost has decreased as follows:
Number
. of items
handled.
Year.
1919
1920
6 months 1921
48,778,466
55,839,481
30,756,324
Total cost.
$602,704.08
616,908.45
306,801. 99
Unit cost
per 1,000
items.
Cents.
12.36
11.05
9.98
At the unit cost of 1919 (12.36 cents), the total cost for the first six months of 1921
would have been $380,148.16, or $73,346.17 more than the actual cost.
At the unit cost of 1920 (11.05 cents), the total cost for the first six months of 1921
would have been $339,857.38, or $33,055.39 more than the actual cost.
Incoming mail division.—While the total cost of this division has increased each
year, the unit cost has decreased as follows:
Year.
Number
of items
handled.
Total cost.
7,387,43311,961,039
7,537,966
$114,405.23
167,509.48
87,618.03
1919
1920
. . . .
6 m o n t h s 1921
Unit cost
per 1,000
items.
Cents.
15.49
14,00
11.62
At the unit cost of 1919 (15.49 cents), the total cost for the first six months of 1921
would have been $116,763.09, or $29,145.06 more than the actual cost.
At the unit cost of 1920 (14 cents), the total cost for the first six months of 1921
would have been $105,531.52, or $17,913.49 more than the actual cost.
Collection department.
Division.
Government check
Coupon collection.
City collection
Country collection.
1
Increase.
Number
of items,
1921.
6,521,348
17«,132
1,962,506
423,948
Cost
on basis of
1920.
$20,998.74
78,762. 85
75,262.11
154,516. 33
Total
actual
cost.
$24,758.49
37,714. 65
59,615.92
148,120.91
Saving.
i $3,759. 75
41,048. 20
15,646.. 19
6,395!'42
132
EXPENSES OF FEDERAL RESERVE BANKS.
Auditing department.
On January 1, 1921, the number of employees was 124 and the salaries in effect
amounted to $204,940 per annum.
On September 15, 1921, the number of employees was 92 and the salaries in effect
amounted to $176,580 per annum. In order to perform the balance sheet examinations the regular force of 92 people will have to be temporarily increased twice a
year, at an estimated cost of $8,200 per annum, making the total estimated annual
salary cost $184,780, or $20,000 less than the salaries in effect January 1, 1920.
Government securities sales department.
Estimated cost:
First six months, 1921
Last six months, 1921
Reduction
$70, 000
14, 000
56,000
Reduction on annual basis
112,000
Government bond department.
Since July 1 the number of clerks in the department has been reduced
by 66, whose salaries amounted annually to
$95, 299. 68
Floor space has been released, costing annually
Total saving
5, 914.00
101, 213. 68
Methods and supplies department.
Purchasing division and expense division.—The force of the purchasing division
has been reduced by three people and that of the expense division increased by one
person during the last few months.
EXHIBIT G.
FEDERAL RESERVE BANK OF NEW YORK,
October 26, 1921.
Hon. W. P. G. HARDING,
Governor ^Federal Reserve Board, Washington, D. C.
SIR: The board of directors of the Federal Reserve Bank of New York, having been
requested by the Federal Reserve Board to present to it a statement setting forth the
basis upon which the scale of salaries of the bank has been determined, hereby respectfully submits the following:
Nature and organization of the Federal reserve banks.—The 12 Federal reserve banks
are separate and distinct corporations chartered under the provisions of an act of
Congress. Their stock is owned not by the Government or the public but by national
banking associations, State banks, and trust companies, all of which are private
corporations owned by private citizens. With the exception of a few specified and
optional open-market purchases, the Federal reserve banks are not permitted to have
direct transactions with the public; they may deal only with their stockholding
member banks and with the Government of the United States, for which they act as
fiscal agents. Consequently the great majority of the transactions of the Federal
Reserve Bank of New York are with its member banks, which contribute the entire
capital stock of the bank, provide about 95 per cent of its total deposits, and to which
about 80 per cent of its loans or discounts are made. It is apparent, then, that the
member banks have a very real and direct interest in the efficient and safe management of the Federal reserve bank of which they are stockholders. Congress recognized this interest and provided in the act that of the nine directors of each reserve
bank six should be elected by the member banks, the other three being appointed
by the Federal Reserve Board. Of the six elected by the member banks, three must
be bankers and the other three must be engaged in commerce, agriculture, or some
other industrial pursuit, representing the interest which business and agriculture also
have in the effective management of the reserve bank.
Responsibilities of directors.—The act provides that the reserve bank "shall be conducted under the supervision and control of a boaixi of directors." It requires the
directors "to perform the duties usually appertaining to the office of directors of
banking associations.7' It gives them all powers necessary "to carry on the business
of banking," including the power "to appoint * * * such officers and employees
EXPENSES OF FEDERAL RESERVE BANKS.
133
as are not otherwise provided for in this act." It is quite evident from the provisions
of the act and the discussions in Congress at the time of its passage that the Federal
reserve banks were expected to be conducted not merely as mechanical agencies for
the dispensing of credit, but as banking institutions exercising wide powers and discretion and intrusted with large responsibilities. Besides making loans to their
member banks they were expected to furnish the country with an elastic currency, a
matter of vital importance to every individual and every business undertaking in the
country. They were expected to develop more scientific and economical methods of
collecting checks, notes, and drafts, of transferring funds throughout the country, and
of clearing the balances resulting from these transactions. They were expected to
develop and support a discount market through which bankers' acceptances drawn to
facilitate our foreign and domestic trade would find a ready sale and through which, at
times of heavy credit requirements, foreign banking funds would readily flow to this
country. They are given broad powers to deal in gold at home or abroad, and to
appoint agents and maintain accounts in foreign countries in order that they may have
a steadying influence on the periodical movements of gold to and from the United
States. As fiscal agents for the Treasury Department they have been able to assist
the Treasury in conducting the finances, managing the public debt, and maintaining
the credit of the United States, and have been instrumental in creating an open
market for Treasury certificates of indebtedness, thereby greatly facilitating their
sale. Finally, as custodians of the gold reserves and the ultimate credit power of
the country, they are expected at all times, and particularly in sudden emergencies,
to administer their trust in such a manner as to insure the maintenance of the gold
standard in the United States and to prevent the periodical panics from which the
country has suffered so severely in the past.
The development and management of such an institution, haying responsibilities
of a much wider nature than those of the member banks, requires the selection as
officers of men trained in banking, with imagination, constructive ability, and sound
judgment, courageous and able to lead; men capable not only of administering the
routine functions of the bank, involving frequently a turnover of a billion dollars in a
single day, and of safeguarding its many billions of dollars in cash and securities, but
capable also of the difficult task of formulating and carrying out policies affecting both
national and international finance.
Appended to this letter is a brief summary showing the enormous volume of some of
the routine transactions of the bank, but it may be mentioned here that the total loans
and discounts made by the bank since its organization aggregated about $159,000,000,000.
Policy in appointing officers.—It was recognized by the directors of the Federal
Reserve Bank of New York from the outset that the effective organization and development of the bank depended largely upon the character of its personnel, and they
have selected as its officers men of banking experience with a view to the assumption
and exercise of the wide responsibilities with which it is charged. These officers
have organized and are administering a bank with a staff of 2,896, a bank whose
resources and transactions are far larger than those of any other bank in the United
States.
The directors have also from the outset followed the policy of filling vacancies,
both official and clerical, as far as possible by promotions from within the staff as the
only sound method of developing and maintaining a high esprit de corps throughout
the organization. This has been markedly successful, and the rapid growth of the
institution during the past lew years has afforded unusual opportunities for the display of individual initiative and ability, which have been recognized by promotion
in rank and salary.
Tne period of seven years during which the bank has been in existence has been
probably the most difficult period in the history of banking in the United States.
It has been no time for experimenting with inexperienced officers or with men who
had not demonstrated their ability to command the normal salaries of bank officers.
Errors of judgment or defects in the organization might easily have resulted in losses
far exceeding any savings that might have been made through the payment of lower
salaries to less competent men to manage the affairs of the bank.
Besides carrying on immense routine transactions the officers of the Federal reserve
bank of New York have also shown themselves able to grasp and deal with the larger
functions and responsibilities of the bank. They have devoted themselves with
enthusiasm and single mindedness to their work, have gained the confidence of the
member banks and the public, have recommended wise measures and policies, and
have shown themselves resourceful in meeting the many new and unexpected situations which have arisen during the past seven years.
134
EXPENSES OF FEDERAL RESERVE BANKS.
Salary policy.—In order to procure and retain officers capable of discharging these
responsibilities the directors from the outset have followed the policy of fixing salaries
at a level fairly commensurate with the salaries paid to officers of corresponding rank
in the larger member banks in New York City. The range of salaries paid is frequently tested, (a) by comparison with the salaries actually paid by the larger New
"York City member banks, and (&) by invitations extended to the officers to join the
staffs of other banks at higher salaries.
Many of the officers have had opportunities to go to other institutions at higher
salaries than they receive from the Federal reserve bank and the directors are convinced that the range of officers' salaries is generally below what might be considered
their earning power and below the average salaries paid to officers of similar rank
in the larger New York City member banks. Many of the officers whose promotion
has been the most rapid have been among those most sought after by other institutions at higher salaries. The officers of Federal reserve banks are not engaged in
public or governmental service, but, like the officers of national, banks, they are
private citizens engaged in banking as a means of making a livelihood. They are
forbidden to engage in other business, and their only remuneration is the salary paid
them by the Federal reserve bank. As long as they serve the bank they have a
right to expect remuneration for their services in accordance with the local value of
such services.
The details of the circumstances and conditions governing the increases in the
salary roll of the bank, both official and clerical, and the proportion of officers' salaries
to the total salary roll and to the total resources of the bank, which is much less than
in the larger commercial banks in New York City, are dealt with very fully in the
letter addressed by the governor of the bank to the Federal Reserve Board under date
of October 6, 1921, copy of which is attached hereto.
The undersigned directors of the Federal Reserve Bank of New York fully appreciate the responsibilities which the law imposes upon them for the successful operation of the bank, for the safe custody of its immense resources, and for the fulfillment
of its obligations to the Treasury, to the member banks, and to the public. In addition
to carrying on the routine work we must look ahead and prepare for the discharge of
the new obligations which are falling upon the Federal Reserve System as a result of
our larger participation in world finance. The directors are unanimously of the
opinion that the only sound policy for the bank to pursue is to procure and retain men
capable of discharging these obligations in the most complete and effective manner,
and that to carry out such a policy it is necessary to pay salaries, both official and
clerical, which are fairly commensurate with those paid by the larger member banks
in the city of New York. Under any other policy the present type of officers could not
be retained and the spirit and work of the organization would degenerate. Nothing
could be more dangerous to the permanence of the system than to have the Treasury,
the member banks, or the public lose confidence in its management.
This statement is submitted merely as a brief review of the salary policy of the bank.
If at any time information is desired regarding duties, responsibilities, and salaries of
individual officers and employees, the directors will be very glad to furnish it either
to the Federal Reserve Board or to some appropriate committee of Congress.
Respectfully submitted.
JAMES S. ALEXANDER.
PIERRE JAY.
LESLIE R. PALMER.
GEORGE FOSTER PEABODY.
CHARLES SMITH.
WM. L. SAUNDERS.
CHARLES A. STONE.
ROBERT H. TREMAN.
RICHARD H. WILLIAMS.
VOLUME OF SOME OF THE TRANSACTIONS OF THE FEDERAL RESERVE BANK OF NEW
YORK DURING 1920.
Discounts and advances, 180,462 items, aggregating $50,539,423,847.
Acceptances purchased for New York and other Federal reserve banks, 106,237 items,
aggregating $2,428,000,000.
Federal reserve notes and other paper money handled and counted, 558,397,400
pieces, aggregating $2,291,785,688.
Shipments of currency and coin, 67,405
shipments.
Checks collected, 87,727,000 items,1 aggregating $55,729,013,000.
,
i
1
Includes items sent between Buffalo branch and main bank at New York;figures«hownin our annual
report for 1920 excludes these items.
EXPENSES OF FEDERAL RESERVE BANKS.
135
Notes and drafts collected, 563,814 items, aggregating $1,994,713,245.
Telegraphic transfers of funds, 147,302 transfers, aggregating $17,021,509,734.
Balances settled through gold settlement fund, $48,840,900,000.
United States Government checks and warrants paid, 10,712,243 items, aggregating
$2,437,759,148.
Government bond department transactions, 47,797,417 pieces, aggregating $6,955,101,000.
Total certificates of indebtedness department transactions, including issues and
redemptions, $4,897,941,000.
Securities handled in custody department for United States Treasury and member
banks, $100,759,404,785.
O
@FedFRASER