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JUL ^ RESEARCH U B M t t BAMING AID MONETAE! HTVELOPMEHTS Bf JURE 1959 Summary. Total credit at commercial banks showed little further change in June, Loans continued to increase rapidly while holdings of United States Government and other securities declined. The seasonally adjusted active money supply declined slightly. Time deposits increased moderately. United States Government deposits declined. Net borrowed reserves of member banks rose further. Bank credit. Loans and investments at all commercial banks increased only slightly in June, much less than usual, as shown in Table 1. Loans rose $2.1 billion further, slightly less than in 1958 (when there was a large increase in security loans associated with Treasury financing) but about the same as in 1955 and 1957• Holdings of United States Government securities declined $1.8 billion, somewhat more than in June of any other recent year. Sales were substantial over the month and, in addition, commercial banks held about $500 million of the $3 billion tax anticipation bills redeemed on June 22. Holdings of securities other than those of the United States Government declined whereas they usually increase in June. At weekly reporting banks in leading cities, credit declined in June, in contrast with the usual seasonal increase. Loan growth was less than in June of the proceeding four years and the reduction in holdings of United States Government securities was larger than in any recent year. At country member banks, on the other hand, total credit increased in June whereas it had declined during this month in the 1955-57 period« Loan growth was considerably larger than in June of any other year (including 1958) while the decline in holdings of United States Government securities was smaller than the 1955-57 average. Over the January-June 1959 period, total credit at commercial banks declined about $1,3 billion (after adjustment for bank structure changes), roughly in line with the usual seasonal reduction. Loans increased almost $5 billion, slightly more than in the comparable period of any other postwar year. In meeting heavy loan demands, banks reduced their holdings of U. S„ Government securities by about $6 billion, considerably more than the Wot for publication L.ii.3 -2- Table 1 Estimated Changes in Loans and Investments at All Commercial Banks (In billions of dollars) Last Wednesday in May to end of June 2/ Item 1959 Total loans (excluding interbank) " 1958 1957 1956 1955 1951 + 2.1 + 2.3 + 2.1 + + + + + + 1.1 0.3 0.1 0.1 O.li 0.3 + + + + + + 0.7 0.2 1.0 0.2 0.1 0.2 + + + + + 1.6 0.1 0.1 0.1 0.3 0.1 + 1.3 + 0.2 — 0.1 - 0.1 + 0.3 + 0.1 + 0.1* + 0.1 + + + + + + U. S. Government securities - 1.8 + 1.5 — 1*6 - 0.7 1.7 + 0.2 Other securities — 0.2 + 0.6 y - + 0.1 + 0.1 + 0.2 + 0.2 + h.h+ Business Real estate Security Agricultural Consumer All other + 0.9 + 0.3 + 0.2 y # + 0.9 2.0 o o.5 + + Total loans and investments (less interbank) 1.5 + 1.0 + 0.1 0.2 0.2 0.1 0.2 0.1 l.It Last Wednesday lin May to end of June 2/ Item Total loans (excluding interbank) 1953 1952 1950 1919 + 0.3 + - 0.2 + 0.1 + 0.1 1/ + 0.1 + 0.1 + o.U U. S. Government securities + 0.3 + 0.5 + Other securities — 0.1 + 0.2 + 0.2 + 0.2 + . 0.2 + 0.6 + 1.7 + + 0.7 + 0.6 Business Real estate Security Agricultural Consumer All other Total loans and investments (less interbank) 1.1 1951 + 0.1 + -0.2 + O.lt y + 0.6 + + + + + + 0.2 + 0.2 — 0.1 1/ + 0.2 + 0.2 0.2 0.1 0.2 0.1 1/ - 0.1 O.h1.2 0.8 0.3 + 0.3 1948 + O.lt n.a. n« 2io He ct# n+a* !!• cl* n»a, 11® 3,0 n.a* + 0.1 + 0.1 3,# ii* a* y - i.i y - 0.7 1/ Less than $50 million. n.a. Not available 2/ Dates are for June 30 for all years except 1959, 1958, and 1957 which are for last Wednesday Note: Data for June 2h» 1959, are preliminary estimates based on data reported by a ^ sample of member banks. Revised data will be available at end of July. Not for publication L.lt.3 -3Table 1 (continued) Estimated Changes in Loans and Investments at All Commercial Banks (In billions of dollars) Item Total loans (excluding interbank} Business Real estate Security Agricultural Consumer All other U. S. Government securities December 31 to end of June 2/ 1959 3/ + 5.1 O.lt + 1.7 1.7 + 1.6 - 0.6 ¥.h - 5.8 + 1/ — 0.6 0.1 0.2 0.8 li.lt 0.2 0.1 1953 - 0.3 + 0.9 2.0 — 1.1 — 0.5 2.9 1.0 0.6 0.6 O.li 1951* l.li + 0.5 + 0.5 + 0.2 — O.li ¥.s + 0.2 — 0.2 1.2 — 0.1 + 1.2 0.9 0.3 0.6 + 0.1 + 0.2 3.1 5.0 5.7 + 0.1 - + 2.1 + 0.5 0.2 0.5 + 0.9 + — 6.k 8.9 - 0.2 - 1.0 — 0.8 li.7 + 0.1 + 0.7 - 3.7 December 31 to end of June 2/ Item 1952 Total loans (excluding interbank) 1.8 0.6 1.2 1955 1.2 2.1t 0.1 + 0.9 1956 1957 0.5 + Other securities Total loans and investments (less interbank) 1958 1951 1950 19h9 . 1918 19lt7 19Zt6 + 1.5 + 2.5 + 1.8 - l.li + 1.8 + 2.6 + 0.9 — + + + + + 0.6 O.li 0.5 0.2 0.8 0.1 + + + + + 1.7 0.6 0.2 0.2 0.1 0.2 + + + + 0.1 0.9 0.2 0.2 0.8 0.3 + * + 2.5 0.2 0,6 0.1 0.3 I / + + + + + 0.2 0.8 0.2 O.li 0.6 0.2 + + * + + + U. S. Government securities - 0.3 - 3.5 - 1.3 + o.6 - li.lt — It.2 — 6.1 Other securities + 0.7 + 0.3 + 1.0 + 0.3 + 0.2 + O.li + o.5 + 1.8 - + - - — 1.2 — li.7 Business Real estate Security Agricultural Consumer All other Total loans and investments (less interbank) 0.7 1.6 0.5 2.5 0.7 1.1 0.3 0.2 0.7 0.2 + 0.8 + 1.1 - 1.7 1/ + 5.5 + 0.3 1/ Less than $50 million. *2/ Data are for June 30 for all years except 1959, 1958, and 1957 which are for last Wednesday. 3/ Structure changes increased total credit about $6U0 million; loans about $370 million; Government securities, about $200 million; and other securities about $70 million. http://fraser.stlouisfed.org/ Not for publication Federal Reserve Bank of St. Louis # —4— L.4.3 Table 1 (continued) Changes in Loans and Investments and Deposits at City and Country Banks (In millions of dollars) • Last Wednesday in May to last Wednesday in June Item 1959 1958 1956 1955 1954 +1,698 - 961 7 + 730 +1,244 - 291 55 + 898 +1,411 -1,220 + 1 n ? ? + 381 + 684 + 182 +1,247 281 -1,038 + 446 591 47 97 . + + + 321 320 57 58 + 268 + 361 \ Weekly reporting banks • 1957 Total loans U. S. Government securities Other securities Total loans and investments +1,314 -1,234 — 146 66 - Demand deposits adjusted - +1,733 +1,522 + 478 +3,733 170 - 168 + 580 + + 520 + 41 + 121 + 682 + + 669 492 19 196 359 585 68 158 •f 225 467 + 73 168 + 66 + 191 148 210 689 - ^jountry member banks Total loans U. S. Government securities Other securities Total loans and investments ^ Demand deposits adjusted + + + Last Wednesday in May to last Wednesday in June Item 1953 1952 1951 62 436 152 + M + 547 + 760 + 96 +1,403 + 449 + 733 + 84 +1,266 + + + + 551 182 124 857 - 435 + 10 - 118 + + + + + 240 272 53 21 48 300 57 195> + + 132 341 51 1^7 + 149 + 182 # 1950 1949 1948 Weekly reporting banks Total loans U. S. Government securities Other securities • Total loans and investments Demand deposits adjusted + + + + 183 33 112 328 + 106 - 571 + 41 - 424 439 - 290 - + + + 236 214 59 82 + 49 256 32 174 + 146 - 332 + 21 - 165 - 97 - 128 + + 443 Country member banks W Total loans tf, S. Government securities Other securities Total loans and investments ^ Demand deposits adjusted + + - 265 291 Note: Data for country banks include interbank loans, but interbank loans outstanding at these banks have generally been less than $100 million although on March 12, 1959, they were close to $200 million. Data for weekly reporting banks include interbank loans prior to 1952. ^>t for publication Lelu3 # -5Table 1 (continued) Changes in Loans and Investments and Deposits at City and Country Banks (In millions of dollars) End of December to last Wednesday in June 1/ Item 1959 2/ # 1958 1957 1956 1955 1954 +2,381 -4,410 7 -2,036 - 857 +6,192 *1,511 +6,846 + 677 -1,737 * 107 - 953 +2,754 -3,540 - .328 -1,114 +2,694 -4,826 * 98 -2,034 -1,424 + 925 + 739 + 240 -2,505 -1,621 -2,485 -2,672 -2,289 -2,898 +2,049 -1,219 + 55 + 885 + 738 + 2k6 + 487 +1,471 +1,208 -1,039 + 388 + 557 +1,337 -1,494 + '133 23 +1,357 -1,308 + 291 + 340 + + + -1,703 -1,962 -1,988 -1,687 - -1,460 Weekly reporting banks Total loans U. S. Government securities Other securities S Total loans and investments Demand deposits adjusted Country member banks $ Total loans U. S. Government securities Other securities Total loans and investments Demand deposits adjusted 943 603 644 111 70 End of December to last Wednesday in June 1/ Item 1953 1952 1951 1950 1949 : 1948 iStekly reporting banks ( Total loans - 220 U. S. Government securities -3,756 Other securities it Total loans and investments -3,980 + 366 + 252 + 528 +1,146 +1,278 -2,498 + 66 Demand deposits adjusted -1,919 - + 815 -1,155 + 104 - 235 + + + - -1,380 -1,154 + 690 - 831 + 680, + 539 -1,677 +1,X£L + 344 - 142 + 412 -2,561 20 -2,169 523 -1,726 - -1,701 -2,271 837 381 137 593 + 870 -1,130 + 15b - 110 + 818 32 + 239 +1,026 + - +1,035 - 965 + 229 + 299 -1,177 55 281 Country member banks Total loans ® U. S. Government securities Other securities Total loans and investments Demand deposits adjusted 315 23 389 24 386 -1,301 - 785 Country bank data are for June and December call dates. ?/ Country bank assets and liabilities were increased about $350 million in April as a result of inclusion of a national bank in Hawaii and the shifting of six national banks in Alaska from nonmeniber banks. (Loans +200; U.S. Govt. +100; other sec.+50; dem.dep.adj.+200; time +150) Note; Data for country banks include interbank loans, but interbank loans outstanding at these banks have generally been less than $100 million although on March 12, 1959, they were close to # 0 0 million. Data for weekly reporting banks include interbank loans prior to 1952. http://fraser.stlouisfed.org/ Not for publication Federal Reserve Bank of St. Louis -6- L.U.3 Table 2 Changes in Commercial and Industrial Loans l/ (In millions of dollars) Last Wednesday of May to last Wednesday of June Business of Borrower 1959 1958 1957 1956 19$h 19# Food processors Commodity dealers Trade concerns Total - U8 + h6 - - 59 + + 19 + 25 5 — 66 - 96 n + 1*8 - % 6 + 1 - 106 Sales finance + 336 + 58 + 315 + 59 + 239 + - All other - total + Metals and products Textiles, apparel and leather + Petroleum, coal, etc Other manufacturing and mining • Public utilities + Construction + All other types of business + Classified Unclassified Total change 1/ 57 581t 39 27 kh 180 5k + - 29 61 + h3 + - h7 - 31 36 2 65 - 65 - 35 91 - 53 + 2 + 5 - 15U •• 8 3 8 + 70 67 + + 111 +1,098 +1,066 + 5k9 - 33 + 1 2 8 + 2 6 3 + Tff - 306 + 72 + n "rm + + 6 + Uo + 62 31 + 201 + 170 + 57 + 97 + 106 + iOt + 22 + tiO + 16 73 + 351 + 222 + 2lt3 + 183 + 5 + 59 30 + 29 * 2h + 6U + 18 + 1 0 + 1 5 + * 133 78 + 85 + 86 + + W 36 52 + 5 + 18 - 63 + 2 ill + 66 + w* 26 + 3h • 872* + 70 + h7k +I,bl5 +1,019 + 739 - 30 + 60 - 1 8 + 2it9 9 21 + + 9bh + 538 +I,b36 +1,082: >/+860 + 30 - 39 + 258 + 614 + 21 + 63 y+121 Prior to week ending January 11, 1956, included changes in agricultural loans< 2/ Includes CCC certificates of interest which are estimated and have declined #55 million. Note: Classified data are for a sample of about 210 banks reporting changes in their larger loans} these banks hold over 95 per cent of total commercial and industrial loans of all weekly reporting banks and about 75 per cent of those of all commercial banks. Not for publication -7- L.U.3 Table 2 (con't) Changes in Commercial and Industrial Loans 1/ (In - millions of dollars) Business of Borrower End of December to end of June: 19 59 1958 1957 1956 1955 1951* Food processors Commodity dealers Trade concerns Total + - 1*59 355 307 507 Sales finance + 321 - All other - total Metals and products Textiles, apparel and leather Petroleum, coal, etc. Other manufacturing and mining Public utilities Construction All other types of business +1,192 + 195 +2,035 +2,961 +1,521* - 230 + Qhh + 11*6 + 935 7TTW +~T77 r-377 Classified Unclassified Total change + - - 658 - 283 - 158 -1,099 - 213 + 11*2 - 853 + 130 + 366 - 81* + 11*8 + 11*0 + 291 + + 199 + 157 + — 156 - 177 + + 101* + 56, + 1*56 - 302 539 - 3 8 6 1 + 171 996 - 517 69 1953 1952 + - 51*0 1*61 11*6 855 - 505 657 - 868 363 - 61*1* - 6 3 I * 1*1 + 215 - 105 909 —1,086 -1,607 322 + 589 - 175 238 + 1*21* + 220 + 313 - 55 10 211* + 513 + 12 • 369 + 365 + 51* + 153 381* + 131* + 1 126 71 51* + 11*9 + 11*3 + 106 - 91 - 217 + + 61*0 +1,278 1*20 +l,lll + 156 73 1*5 + 176 • + + + 90 + 12 18 + 76 2 18 - 11 - 28 +1,008 -1,758 +1,1*01* +2,121* +1,257 -1,311* + 185 - 180 - 155 + 119 2/-179 y-182 - 536 — 51*6 269 91 +1,192 -1,938 +1,21*9 +2,21*3 ?/+1078 ^-11*96 — 805 1- 637 1/ Prior to week ending January 11, 1956, included changes in agricultural loans. 2/ CCC certificates of interest which are included in data are estimated to have declined #520 million. 3/ CCC certifiactes of interest which are included in data, are estimated to have increased $65 million. Notes Classified data are for a sample of about 210 banks reporting changes in their larger loans; these banks hold over 95 per cent of total commercial and industrial loans of all weekly reporting banks and about 70 per cent of those of all commercial banks. Not for publication usual amount for this time of year. Holdings of other securities showed little over-all change. Banks added somewhat to their holdings of State and local government issues but reduced their holdings of non-guaranteed Federal agency debt. The total credit decline in the first half of 1959 was somewhat larger than usual at city banks while at country banks, the total credit increase was somewhat larger than usual. Loan growth at country banks substantially exceeded that of any other year, while at city banks, loan growth was large but less than in 1955 and 1956. The reduction in holdings of U. S. Government securities was considerably larger than usual at city banks and slightly larger than usual at countiy banks. Business loans at city banks increased $9^5 million in June, accounting for about three-quarters of the total loan growth at these banks. An increase of $1 billion in the tax payment period (two weeks ending June 1 7 ) was offset in small part by prior and subsequent reductions. The expansion in business loans during the month of June was considerably larger than in 1958, about the same as in 1955, but less than in 1956 and 1957. Borrowing by sales finance companies totaled $335 million at city banks during June, over one-third of total business borrowing. As is usual in a quarterly tax month,tillsborrowing reflected in part a shift In financing from open market paper held by corporations to direct bank borrowing rather than an Increase in total borrowing by finance companies. Metals manufacturers increased their borrowing by $175 million, less than in 1 9 5 6 and 1 9 5 7 , but more than in 1955* Public utilities, which had been reducing their outstanding loans most of the year, increased their borrowing in June, but not as much as In the 1955-57 period. Petroleum and chemicals concerns reduced their bank loans further. During the first half of 1959, business loans at city banks increased $1.2 billion, somewhat less than the record increases in the 1955-57 period. Growth in the second quarter alone, however, exceeded that in the same quarter of any other year 5 if sales finance company borrowing is excluded the increase was above that of every year except 1956„ Loans to metals manufacturers accounted for two-thirds of the growth in business loans at city banks during the first half of I 9 5 9 . This reflected in part inventory accumulation by these businesses In anticipation of the possibility of a steel strike after midyear. The increase was smaller than in 1956, however, when a strike had also been anticipated. Loans to trade concerns rose by a record amount In the first half of 1959 and loans to textile manufacturers by a near-record amount. Seductions in loans Wot for publication -9- L.4.3 Table 3 Estimated Changes in Deposits and Currency (in billions of dollars) Item Seasonally adjusted data 1/ Demand deposits adjusted" Currency outside banks Total Seasonally unadjusted data 1/ Demand deposits adjusted ~" Currency outside banks Total Time deposits Commercial banks Mutual savings banks U. S. Government deposits Total Factors affecting deposits and currency Bank loans and investments other then U. S. Govt. sec.3/ Commercial ™* Mutual savings Bank holdings of U. S. Government securities: Federal Reserve Commercial Mutual saving and other Gold stock and foreign deposits at F. R. Banks Other factors V 1958 1959 1959 May \ 2ti May 29 Jan.l June 2b June 25 June 2 ¥ — 0.2 — 0.2 - 0.1 — 0.1 - 0.1 - 0.1 + 0.6 + 1.0 + 0.L + 0.2 + 0.1 + 0.1). + 0.2 — O.I4 +""5711 + 0.1 2/ + 0.9 + 0.1 + lt.1 73% +1.1 + 0.3 ouH - 1^.9 » o.U -T73 + 2.7 + 2.1 + 0.6 + 0.1* 1958 Jan. I June 25 + 2.3 - 0.1 + 2.2 Tear Ending June 2h 'June 25 1959 k/ 1958 5.o O.ii - k.6 r 0.5 + b.9 + 0.5 + 5.5 + 6.5 + 5.1* + 3.7 + 5.5 +"73 - a.9 ^33 + 1.2 + 1.8 + 0.1 + 0.1 + 0.2 0,1 2/„ 0.1 + 9.2 + 7.6 + 1.9 + 5.0 sum + (signs indicate!effect oh. deposit? and currency) + 1.8 + 3.3 + 5.0 + 0.2. + 0.2 + 0.8 - 1.9 + 2.3 + 0.9 .+ l.U - 0.1 — 6.2 — 5.8 2/ - 0.3 - 0.3 — 0.8 - 0.3 TT& T E 5/ - 0.5 + 1.0 +~"S79 + lt.l + 2.5 + 1.6 +10.7 + 7.8 + 2.1 + 2.7 6.9 "CT +10.5 6.U - 3.3 + 0.9 - ii.O 1.3 2.7 + 0.1 0.3 - 0.1 - 1.6 + 9.1 - 0.9 - 1.1 - 2.8 Seasonally adjusted data are for last Wednesday throughout; unadjusted data are for last Wednesday except in case of June and December call dates, when available. Data for 1959, and 1958, are for last Wednesday of June throughout. Less than $50 million. Total includes foreign loans on gold, holdings of bankers' acceptances at the H, Federal Reserve, and loans to foreign banks; changes in these items are generally relatively small. In addition even if there were no changes in these items, changes at commercial and mutual savings banks would not add to total change which is "net" because commercial banks exclude all interbank loans, domestic and foreign. In April 1959 as a result of the addition of a bank in Hawaii, demand deposits adjusted increased about #100 million and time deposits increased about $100 million. In January 1959 as a result of the addition of all banks in Alaska, time deposits at commercial banks increased almost $100 million and demand deposits adjusted increased about $100 million. As the result of the absorption of a mutual savings bank, time deposits at commercial banks increased $300 million, and those at mutual savings banks declined $300 million. Hot for publication http://fraser.stlouisfed.org/ V Federal Reserve Bank of St. Louis L.lt.3 —10— Table 3 (continued) Estimated Changes in Deposits and Currency (in billions of dollars) December 31 to end of June 1/ 1957 1956 1955 1954 1953 1952 Seasonally adjusted data 1/ Demand deposits adjusted" Currency outside banks Total + 0.6 + 0.2 + 0.8 + 0.9 + 0.2 + 1.1 + 2.1 + 0.2 + 2.3 + 0.2 - 0.3 — 0.1 + 1.0 + 0.3 + 1.3 + 2.9 + 0.6 + 3.5 Seasonally unadjusted data 1/ bemand deposits adjusted Currency outside banks Total Time deposits Commercial banks Mutual savings banks U. S. Government deposits Total — + + + + - t + + + + - + + + + - — + + + + - — + + + - + + + + + + 5.8 o.5 6.3 U. 2 3.1 0.9 0.7 1.5 5.2 2.2 1.3 1.0 1.6 1*3 3.3 0.5 3.8 1.8 1.0 1.0 0.7 1.2 U.3 1.0 £-3 2.9 2.0 1.0 2.0 O.It It.6 0.1 it. 7 2.5 1.6 1.0 1.6 3.8 3.5 0.2 3.3 2.2 l.lt 0.9 2.6 1.5 December 31 to end of June 1/ 1951 1950 19h9 Seasonally adjusted data 1/ Demand deposits adjusted Currency outside banks Total + 1.2 + 0.6 + 1.8 + 2.5 — 0*1 + 2.1 2/ - 0.3 — 0.3 - 1.2 — O.It - 1.6 + 1.3 n.a. n* si * n* &* ^^ua* n. a* Seasonally unadjusted data 1/ Demand deposits adjusted Currency outside banks Total Time deposits Commercial banks Mutual savings banks U. S. Government deposits Total + + + + + + + + + + + - 3.6 • — 0.8 - Zt.lt + 1.0 + 0.5 + o.5 - 0.8 - lt.3 -lt.lt — 0.8 - 5.3 + 0.9 + o.5 + O.It + 1.8 - 2.5 - i.i -o.lt - 1.6 + 1.7 + 1.0 + 0.6 — l.lt - 1.2 + 3.6 3.3 o.b 2.9 0.7 0.5 oA 3.0 0.8 0.7 0*2 o.9 l.i 0.6 0.7 0.7 0.9 191*8. 191*7 , 1916 + 3.It + 2.3 + 0.9 -11.2 - It. 3 l/ Seasonally adjusted data are for last Wednesday throughout; unad;usted da-:a are for last Wednesday except in case of June and December call dates, when available. Data for 1957 are for last Wednesday throughout. 2/ Less than $50 million. Not available Not for publication —11— L.4.3 to food processors and commodity dealers were smaller than usual. Public utilities and petroleum and chemical concerns reduced their outstanding loans in contrast with substantial increases in the 1955-57 period. Beal estate loans at all commercial banks are estimated to have increased $300 million further in June, bringing the growth over the first half of 1959 to about $1.4 billion (after adjustment for bank structure changes), about the same as the first-half 1955 record rise. Consumer loans are estimated to have increased $400 million further in June and about $1.4 billion over the JanuaryJune period. First-half expansion slightly exceeded that of any other year. Security loans declined slightly in June and $600 million over the first half of 1959. Agricultural loans showed little further change over the six-month period. Deposits and currency. Seasonally adjusted demand deposit and currency holdings of businesses and individuals declined $100 million in June following moderate growth in April and May and sharp expansion in February and March. So far this year, the money supply has increased at an annual rate of about 2 per cent compared with 3-1/2 per cent in the same months of 1955> a comparable period in the previous economic upswing. At the end of June, the money supply was about 4 per cent above the year-ago level. United States Government deposits at commercial banks declined $500 million in June. Over the first half of 1959, they increased only slightly compared with substantial expansion in the first half of most other recent years. Time deposits at commercial banks increased $400 million in June bringing expansion so far this year to $1.6 billion (exclusive of deposits in new reporting banks). Growth was at an annual rate of about 5 per cent, somewhat below the postwar average prior to the sharp increases in 1957 and 1958. Deposits in mutual savings banks rose $200 million further in June bringing expansion (after adjustment for bank structure changes) to $900 million compared with $1.2 billion last year. The 1959 rate of growth was also somewhat less than in most earlier years. Deposit turnover. The seasonally adjusted annual rate of turnover of demand deposits in leading cities outside Hew York and other financial centers rose to a postwar high of 24.8 times in the second quarter of 1959. This was about 9 per cent above the level of the second quarter of 1 9 5 8 and 5 - 1 / 2 per cent above the peak in the previous upswing in the third quarter of 1957. Turnover also rose at banks in Hew York City but in the second quarter of 1 9 5 9 the rate was still below the previous peak in the second quarter of 1 9 5 8 , when the volume of financial transactions in that city had been unusually large. Hot for publication -12- Table h Free Reserves (excess reserves minus member bank borrowings; based on average of daily figures; in millions of dollars) All member New York Chicago Reserve City Quarterly averages 1958: First Second Third Fourth 508 1959: First Second 1958: 1959: January February March April May June July August September October November December January February March April May June Ma} 27 June 3 10 17 2h July 1 31U a 28 it l 17 27 63 55 192t 82 363 25 52 67 56 215 393 122 321* lt95 li93 51*7 U6 lbh 516 383 95 96 20 ia 16 25 6 18 7 7 12 It 79 3 U3 80 i? 32 201 198 189 197 59 65 28 53 26 122 61i 111 63 223 195 228 28Z* 360 535 314 25 hQh hi litO 258 Not for publication 25 h2 3 51 7 22 8 16 318 513 89 51 15 329 51i5 55o 519 ti.9 15 3 9 600 Note: Data for July are preliminary, 10 18 k9 h6 12 • 16 15 38 73 88 56 39 1 62 itlt 89 57 56 22 310 ii67 600 559 519 It 93 Bank reserves* Net borrowed reserves of member banks averaged $515 million in June compared with $315 million in May, as shown in Table 4. Borrowings rose to an average level of $920 million and excess reserves to $410 million. Most of the tightening in June occurred at reserve city banks. Over June, as shown in Table 5, reserves were absorbed principally by a larger-than-seasonal currency outflow of $325 million and a reduction in gold stock of $ 1 9 0 million. In late June (reflected only in small part in monthly average data) gold stock was reduced by $3^4 million in payment of the gold portion of the increased U. S. subscription to the International Monetary Fund. The remainder of the payment, $1,031 million (75 per cent of the total) was paid in non-interest bearing demand notes of the Treasury. Free gold was used to meet $300 million of the payment, and Treasury cash was reduced $300 million, offsetting to that extent the effect of the transaction on member bank reserve balances. Reserves were supplied in June by Treasury operations, a contra-seasonal reduction in required reserves, an increase in Beserve Bank float, and small System purchases of United States Government securities. Increases in required reserves in midJune associated with bank credit expansion during the tax period were more than offset by prior and subsequent declines. Banks met the remainder of their reserve needs by increasing their borrowings with the Federal Beserve and reducing their excess reserves. Hot for publication —1U— I««Zie3 Table 5 Changes in Member Bank Reserves, with Relevant Factors ^Monthly average of daily figures; in millions of dollars) June Item Jan. - June 1958 1959 1959 Tear ending June 1958 1958 1959 Member bank reserve balances Total Required reserves Effect of reduction in requirements Effect of deposit change Excess reserves - 129 - - 377 — kk& - 820 - 119 - 382 89 + 147 - 339 - 869 + 69 - 511 89 + - 339 109 + - 69 218 ho Principal factors Currency in circulation Gold stock and foreign accounts Treasury operations Federal Reserve float Other factors Effect of above Factors on reserves + — U7 ko -i,UiO + 571 + k9 -1,240 + 929 + 129 (signs indicate effect on reserves - 326 - 190 + 130 - 2I4.2 + 55b + 306 57 75 k6 + - 5U8 87 W7 67 -1,215 + 69 - 527 * 233 —1,1*56 + 95 • 93 — 96 -1,019 + 226 - 25L - 115 -1,013 -2,141 -1,299 + 193 +1,993 + + 767 +T7JB5 - 315 +1.21& +1,760 +1,701 - 7k + + 12 - 32k - 1*62 - 1*61 + 195 + 837 + 11 + Ii3 + 810 - 3k9 - 2k + 52 - 82 13 + + 363 10 + 893 - 777 - 137 Federal Reserve loans and investments s Total U. S. Gov't, securities Outright Repurchase agreements Acceptances Discounts and advances t To member banks To others Hot for publication + 2 15U + + k 23 - 568 6 916 - 38 17 - + 23 + + 779 17 - 863 1* 20 Tear or month End of Dec. 191*7 191*8 191*9 190 1951 1952 1953 1951* 1955 1956 1957 Deposits (In billions of dollars) (8) (2) (1*) (5) (6) (7) (10) (1) (9) (3) Seasonally ad;justed Seasonally Time deposits money suppl] 1/ adjusted U. S. money Demand CurGov't, Total Demand rency supply and deposits Total Commer- Mutual Postal deposits (2+3) deposits outside time dep. adjusted (7+8+9) cial savings savings Z/ adjusted banks at com'1. banks(1+7) f. 111.1 85.2 11*6.3 25.9 87.1 56.1* 3.1* 35.2 17.7 2.3 108.8 ll*l*.6 83.5 25.3 3.6 85.5 35.8 18.1* 57.5 3.3 109.0 81*. 3 21*. 7 11*5.1 85.8 58.6 i*.i 36.1 19.3 3.2 111*.3 89.8 150.6 20.0 2l*,5 92.3 36.3 2.9 59.2 3.7 120.1 158.0 25.6 98.2 9l*.5 20.9 61.5 1 37.9 2.7 3.9 12l*.7 26.9 165.1* 101.5 97.8 65.8 1*0.7 22.6 2.5 5.6 126.8 102.5 70.1* I*.8 170.5 2.1* 27.3 99.5 1*3.7 2l*.l* 102.8 106.6 129.7 26.9 1*6.8 26.3 176.5 2.1 5.1 75.3 105.8 181.6 27.1* 1*8.1* 28.1 133.2 i*.l* 109.9 78.1* 1.9 13U.1* 106.7 185.0 111.1* 82.2 50.6 30.0 1.6 27.7 1*.5 28.1 133.2 1 0 5 . 1 110.3 189.3 89.1 56.1 31.7 1.3 1*.7 (11) (12) Total deposits Curand rency outside currency banks (5+6+10 +11) 26.5 26.1 25.1* 25.1* 26.3 27.5 28.1 27.9 28.3 28.3 28.3 172.3 172.7 173.9 180.6 189.9 200.1* 205.7 211*.8 221.0 226.1* 232.3 19581 May 28 107.6 196.2 105.8 60.7 1.2 6.1 135.5 27.9 9U.6 27.8 32.7 23U.3 28.0 June 23 106.2 10.0 135.1* 107.1* 196.9 1.2 61.5 27.8 32.8 239.5 95.5 July 30 28.1 108.1 137.6 109.5 1*.8 96.1* 199.9 62.3 1.2 237.2 32.9 27.9 Aug. 27 200.0 28.1 109.2 28.0 137.3 107.5 6.2 1.2 62.7 97.0 238.7 33.1 Sept.2l* 108.9 108.1 136.7 27.8 199.1* 1.2 62.7 238.1 97.2 5.0 27.9 33.3 Oct. 29 201.0 138.1 110.2 111.0 28.0 21*0.6 27.9 1.2 1*.2 62.9 97.1* 33.1* Nov. 26 110.6 28.2 138.8 200.9 311.9 62.1 33.5 28.8 1.1 96.7 6.3 21*3.7 Dec. 31 28.1 202.6 139.lt 111.3 63.2 1.1 115.5 98.3 28.7 3U.0 21*7.5 1*.9 1959: Jan. 28 110.7 138.5 201.9 27.8 113.8 98.1* 63.1* 33.8 1.1 21*5.1 27.6 5.3 Feb. 25 202.8 H1.2 139.1 27.9 111.3 1.1 21*2.7 98.7 63.7 3U.0 5.0 27.7 Mar. 25 11*0,3 112.2 28.1 20li.li 61*.1 31*. 3 110.3 21*2.0 l*.l* 1.1 99.5 27.9 11*0.7 112.5 Apr. 29p h/ 28.2 205.2 112.5 1.1 61*. 5 3U.3 21*5.1* 99.9 5.1 27.9 May 27p 11*0.9 112.6 28.3 205.8 110.7 100.U 2l*l*.8 28.1 61*. 9 3l*.l* 1.1 5.7 11*0.8 112.1* June 2l*p 28.1* 206.1 110.6 101.0 1.1_ 28.3 21*5.2 3U.6 65.3 5.3 Preliminary. ist Wednesday of the month. _2/ At commercial, savings, and Federal Reserve Banks. "ij As a result of the addition of fen banks in Alaska, time deposits at commercial banks increased almost $100 million and demand deposits adjusted increased about $100 million. As a result of the absorption of a mutual savings bank, time deposits at commercial b&nks increased $300 million and those at mutual savings banks declined $300 million. h/ As a result of inclusion of a national bank in Hawaii, Digitized for demand FRASER deposits adjusted increased about $100 million and time deposits at commercial banks about $100 million. http://fraser.stlouisfed.org/ HotBank fo# publication Federal Reserve of St. Louis # # # # # # # • -16- L.4.3 Loans and Investments at All Commercial Banks " (In billions of dollars) u. s. Loans and Govt, Other Total Real SecuConinvest- secur- secur- loans Business estate rity Farm sumer ments ities ities Date 1947: *1948: *1949: 1950: 1951: 1952: 1953: *1954: 1955: 1956: 1957: Dec. 31 Dec. 31 Dec. 31 Dec..31 Dec. 31 Dec. 31 Dec. 31 Dec. 31 Dec. 31 Dec. 31 Dec. 31 116.2 lilt. 2 120.1 126.6 132.5 ilti.5 11*5.5 155.7 1958: Jan. 29 Feb. 26 Mar. 26 Apr. 30 May 28 June 23 July 30 Aug. 27 Sept 24 Oct. 29 Nov. 26 Dec. 31 166.2 167.1 169.9 171.0 173.8 178.2 . 176.2 178.3 177.9 180.1 182.7 I81t.lt 6U.1 66.1 61i.7 66.2 67.7 66.lt 183.8 181.9 181.1 183.7 183.6 183.8 67.5 65.5 63.2 63.5 62.lt 60.6 a W 0 *2-959: l/ Jan. Feb. Mar. 2/ Apr. May June 160.3 I61t.5 169.3 28 25 25 29p 27p 2Up 69.2 62.6 67.0 62.0 61.5 63.3 63.lt 69.0 61.6 58.6 58.2 9.0 9.2 10.2 12.lt 13.3 llt.l lit. 7 16.3 16.7 16.3 17.9 57.7 58.3 59.6 62.8 63.1 61t.2 1 37.9 li2.lt 42.9 52.2 57.6 64.0 67.lt 70.lt 82.0 89.7 93.2 18.2 18.9 17.1 21.9 25.9 27.9 27.2 26.9 33.2 38.7 40.5 17.9 18.2 18.9 19.3 19.lt 20.1 19.9 20.2 20.6 20.5 20.3 20.6 90.5 90.6 91.5 91.9 91.3 93.9 92.2 92.1 92.6 93.lt 94.7 ' 97.5 38.8 38.6 39.2 38.lt 38.1 38.9 37.9 38.3 38.7 38.9 39.3 ltO.lt 20.lt 20.lt 20.6 20.9 20.8 20.6 95.9 96.0 97.lt 99.3 100.5 102.6 39.2 39.2 lt0.2 ltO.lt ltl.0 42.1 2.1 9.4 10.8 II.5 13.5 III. 6 15.7 16.7 18.lt 20.8 22.5 23.1 23.1 23.2 23.2 23.3 23.5 23.7 23.9 24. 1 24.3 21.7 25.0 25.3 25.6 25.7 25.9 26.3 26.6 2 6.9 3.2 3.6 4.5 5.0 4.3 It. 2 1.7 2.9 3.1 2.9 3.It 3.9 5.0 5.2 lt.5 It.2 4.1 13. lit. 15 3.6 3.9 It.2 5.0 lt.lt 5.6 lt.5 3.6 3.7 3.6 3.9 It. 7 it.2 lf.lt lt.lt lt.lt lt.lt It. 6 It. 6 It. 6 It. 7 It. 8 1.9 5.0 15. 15. 15 15 15 15, 15. 15, 15. 15 15, 15. it.2 5.0 15.9 5.0 16.0 2.3 2.6 2.9 2.6 lt.0 3.9 lt.lt It. 2 4.1 lt.8 3. 4 5. 7. 7 9 10. 10, 16.1 It. 9 16,5 4.9 16.8 5.0 17.2 1/ Total credit increased over |lt00 million in January as a result of bank structure changes. 2/ Total credit increased about $200 million as a result of bank structure changes. Jfote: Data exclude interbank loans. Total loans are after and types of loans before deductions for valuation reserves. Consumer and "other loans" are partly estimated for all dates. Other data are partly estimated on all but June and December call dates. Data for June 2lt, 1959 are preliminary estimates based on data reported by a sample of member banks. Not for publication July 21, 1959
@FedFRASER