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OWNERSHIP OF
AT ALL
INSURED
SIXTH
FEDERAL
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Federal Reserve Bank of St. Louis
DEMAND
DEPOSITS
COMMERCIAL BANKS
RESERVE
DISTRICT
AND
UNITED STATES
ON
JANUARY
27, I960
Federal Reserve Bank of Atlanta
Research Department
May 13, I960
I960 SURVEY OF THE OWNERSHIP OF DEMAND DEPOSITS
Individuals, partnerships, and corporations held about $8.2
billion demand deposits at all Sixth District banks in 5«6 million
separate Recounts on January 27, i960, according to a survey recently
completed by the Federal Reserve Bank of Atlanta.
The results of the
annual survey of the ownership of demand deposits showed that on
January 27, i960 there were about one-half million more accounts than
a year earlier, and that the dollar total of these accounts was about
$1 billion greater.
The average size of the account, however, declined
from $1550 to $lUOO.
The recent estimates are based upon reports received by the
Federal Reserve Bank of Atlanta from a representative sample of member
and nonmember banks in Alabama, Florida, Georgia, the southern halves
of Louisiana and Mississippi, and the eastern two-thirds of Tennessee,
the area included in the Sixth Federal Reserve District.
The survey
conducted by the Atlanta Bank was part of a nationwide survey carried
out every year by the Federal Reserve System.
Information secured in
the survey is used extensively by the Federal Reserve System, Govern
ment agencies, and private organizations in analyzing the condition
of the nation's financial structure.
Summary tables showing the principle findings for the Sixth
District and a discussion of the survey results for the United States
are attached.
Table I shows the percentage distribution of the accounts by type
of owner.
The table shows that so far as their number of accounts is
concerned, the banks deal overwhelmingly with individuals.
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Over 80
percent of all accounts are personal accounts although their dollar
total was only about one-third of the dollar amount for all types of
accounts.
On the other hand, the accounts of incorporated businesses,
making up only 3 percent of the number, constituted over 32 percent of
the dollar total.
The importance of the accounts held by farmers
declined between 1959 and i960 as it has for the preceding two years.
The deposit accounts of unincorporated businesses, however, continued
to become more important.
Table II lists the proportion of accounts and demand deposits
held by various groups and individuals at small, medium-sized and
large banks.
Over 5° percent of the demand deposits of banks with
total deposits of less than two million dollars were held by individuals.
This proportion declined sharply at larger banks, and amounted to less
than 30 percent at banks with deposits over 50 million dollars.
Demand
deposits of corporate businesses accounted for less than 8 percent of
the total at the small banks, while the proportion increased to over
36 percent at the large banks.
The percentage distribution of demand deposit accounts by size of
account is listed on Table III.
Almost UO percent of all accounts had
balances of less than $100 on January 27, i960.
The total dollar
amount of these accounts amounted to less than 1 percent of demand
deposits, however.
At the other end of the scale, accounts with
balances in excess of $100,000 accounted for over one-fourth of demand
deposits, but only two-tenths of one percent of the number of accounts.
Corporate financial holders accounted for the greatest percentage of
large accounts, while personal accounts of individuals dominated the
small accounts.
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TABLE I
SIXTH FEDERAL RESERVE DISTRICT
PERCENTAGE DISTRIBUTION OF DEMAND DEPOSIT ACCOUNTS
OF
INDIVIDUALS, PARTNERSHIPS, AND CORPORATIONS, 1957 - I960
(At all Insured Commercial Banks)
Number of Accounts, Percent of Total
1957
1258
1222
1260
Corporate Financial
1.3
.8
.5
.5
Non-Corporate Financial
1.0
1.0
.4
.4
Corporate Non-Financial
2.2
2.5
2.9
3.0
Non-Corporate Non-Financial
5.1
5.7
6.4
6.3
Non-Profit Organizations
4.9
4.9
5.3
5.0
Farmers
6.9
5.4
4.7
4.2
78.5
79.3
79.8
80.4
«
.1
.1
.1
.1
.3
•
.2
Domestic Business
Individuals
Trust Funds of Banks
Foreigners
Dollar Amount of Accounts, Percent of
1251
1258
1252
1260
14.5
10.3
8.1
7.8
Non-Corporate Financial
2.0
2.5
1.5
1.7
Corporate Non-Financial
28.8
31.3
33.1
32.1
Non-Corporate Non-Financial
11.4
13.8
14.0
15.1
Non-Profit Organizations
3.7
3.8
6.1
4.0
Farmers
4.6
3.7
3.5
3.3
33.2
32.2
31.8
33.8
1.5
1.5
1.6
1.9
.3
.9
.2
.2
Domestic Business
Corporate Financial
Individuals
Trust Funds of Banks
Foreigners
* Less than 5/100 of 1%
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Federal Reserve Bank of St. Louis
TABLE II
SIXTH FEDERAL RESERVE DISTRICT
OWNERSHIP OF DEMAND DEPOSITS
RELATED TO SIZE OF BANK, JANUARY 27. I960
(Percent Distribution Within Size Group)
TYPE OF HOLDER
SIZE OF BANK (Total Deposits in Millions of $)
Under 2
2-10
10-50
Over 50
Number of Accounts
Domestic Business
Corporate Financial
•5
.4
.3
.5
Non-Corporate Financial
.8
.3
.3
.3
Corporate Non-Flnanclal
1.4
2.2
3.3
3.4
Non-Corporate Non-Flnanclal
4.3
6.4
6.4
6.6
Non-Profit Organizations
7.5
5.5
3.5
4.9
Farm Operators
9.3
6.0
1.0
3.7
76.1
79.1
84.7
80.4
.1
.1
*
.1
•
•
.5
.1
Individuals - Personal
Trust Funds of Banks
Foreigners
Amount of Deposits
Domestic Business
Corporate Financial
4.8
4.9
6.5
8.7
Non-Corporate Financial
2.5
1.4
3.6
1.4
Corporate Non-Flnanclal
7*9
19.5
28.1
36.4
14.3
16.1
14.1
15.2
4.9
5.0
3.6
3.9
Farm Operators
12.4
8.1
.6
2.4
Individuals - Personal
53.0
42.8
41.4
29.8
Trust Funds of Banks
.1
2.1
1.6
2.0
Foreigners
.1
.1
.5
.2
Non-Corporate Non-Flnanclal
Non-Profit Organizations
♦Less Than 5/100 of 1%
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Federal Reserve Bank of St. Louis
TABLE III
SIXTH FEDERAL RESERVE DISTRICT
OWNERSHIP OF DEMAND DEPOSIT ACCOUNTS
RELATED TO SIZE OF ACCOUNT, JANUARY 27, i960
(Percent Distribution Within Size Group)
Size of Account, Dollars
TYPE OF HOLDER
Unclassified!
Number
Amount Number
1,000-9,999
100-999
0-99
Amount Number
Amount Number
10,000-24,999
25,000-99,999
Amount
Number
Amount
Number
Amount
Over 100,000
Number
Amount
Domestic Business
Corporate Financial
0
0
11.0
*
19.4
.4
36.5
5.7
14.9
8.5
12.6
25.2
5.6
60.2
Non-Corporate Financial
0
0
21.4
.1
33.6
2.1
37.0
17.0
5.2
12.3
1.5
11.5
1.3
57.0
Corporate Non-Financial
0
0
12.9
«
25.0
.7
39.2
9.9
11.8
11.6
8.4
26.1
2.7
51.7
Non-Corporate Non-Financial
0
0
23.5
.2
36.6
4.5
33.2
31.7
4.5
19.7
1.9
23.9
.3
20.0
Non-Profit Organizations
0
0
44.6
1.3
40.4
12.2
13.5
32.8
.9
12.4
.5
20.3
.1
21.0
Farmers
0
0
35.1
.8
41.4
15.1
22.1
51.8
1.1
14.9
.3
14.9
#
2.5
3.7
Individuals
Trust Funds of Banks
Foreigners
Total
♦Less Than 5/100 of 1%
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11.9
3.6
40.2
1.8
36.1
21.7
11.2
47.6
.5
12.8
.1
8.8
«
9.3
93.8
18.8
«
40.6
.3
28.1
1.7
1.6
.4
0
0
1.6
3.8
.2
1.0
39.9
.7
31.8
6.7
24.0
43.5
3.6
30.2
.5
17.9
0
0
9.5
3.0
38.1
.7
36.1
9.3
14.2
27.9
1.3
13.0
.6
18.5
.2
27.6
Ownership of Demand Deposits
Demand deposits of individuals, partner
ships, and corporations at insured commer
cial banks rose an estimated $2.2 billion, or
2 per cent, in the year ending January 27,
1960. According to the Federal Reserve
System’s most recent Survey of Demand De
posit Ownership, demand deposits of nonfinancial businesses increased by the same
dollar amount as the total, but the relative
increase was 4 per cent. Personal demand
accounts of individuals increased $600 mil
lion, or 2 per cent, while demand balances of
farmers declined $500 million, or 11 per
cent.
As in the past several years the number of
demand deposit accounts held by individ
uals, partnerships, and corporations rose fur
ther. The 2.7 million increase in the current
year was nearly one-fourth larger than in the
two previous years combined.
OWNERSHIP GROUPS
Note.—This article was prepared by Edward P.
Snyder of the Board’s Division of Research and Statis
tics. For results of the January 1959 Survey see the
Federal Reserve Bulletin for April 1959.
Holdings of nonfinancial businesses account
for about one-half of total demand deposits
Table 1
Demand Deposit Accounts
of
Individuals, Partnerships,
and
Corporations
January 27, 1960
[Estimates for insured commercial banks]
Number
Amount
Increase, or
decrease (—),
from Jan. 28, 1959
Jan. 27. 1960
Type of holder
Millions
Percentage distribution
Jan. 27, 1960
Increase, or
decrease ( — ),
from Jan. 28, 1959
Millions
Per cent
Billions
of
dollars
Percentage distribution
Billions
of
dollars
Per cent
2.0
A1I holders......................................
57.1
100.0
2.7
5.0
109.5
100.0
2.2
Domestic business.............................
6.1
10.6
0.3
5.6
64.5
58.9
2.2
3.5
Corporate....................................
Noncorporate.............................
2.1
3.9
3.8
6.9
0.3
(')
15.0
1.0
49.5
15.0
45.2
13.7
2.0
0.1
4.3
0.9
Financial business...............................
Corporate....................................
Noncorporate.............................
0.4
0.2
0.2
0.8
0.4
0.4
<•)
(')
G)
1.2
8.3
-5.9
9.6
7.7
1.9
8.7
7.0
1.7
-0.1
0.1
-0.1
—0.6
0.8
-6.0
Nonfinancial business.............
Corporate....................................
Noncorporate.............................
5.6
1.9
3.7
9.9
3.4
6.5
0.3
0.3
0.1
5.9
15.9
1.4
54.9
41.8
13.1
50.1
38.2
11.9
2.2
2.0
0.3
4.2
4.9
2.0
Nonprofit organizations...................
Farm operators..................................
Individuals—personal.......................
All other...............................................
Trust departments of banks........
Foreigners........................................
2.9
3.0
44.9
0.1
(J)
0.1
5.1
5.3
78.7
0.2
0.1
0.1
0.1
-0.1
2.4
0)
3.6
-4.6
5.7
3.8
-1.7
7.3
5.2
4.4
32.3
3.2
2.2
1.0
4.8
4.0
29.5
2.9
2.0
0.9
0.2
-0.5
0.6
—0.3
-0.3
(*)
4.9
-10.9
2.0
— 8.2
-10.9
-2.0
G)
0)
> Increase of less than 50,000 accounts.
2 Decrease of less than 50,000 accounts.
2 Less than 50,000 accounts.
* Decrease of less than $50 million.
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Note.—Corporate farming enterprises are classified as corporate
nonfinancial business. Details may not add to totals because of
rounding.
367
REPRINTED FROM
FEDERAL RESERVE BULLETIN
FOR APRIL 1960
368
FEDERAL RESERVE BULLETIN • APRIL 1960
of individuals, partnerships, and corpora
tions. The 4 per cent increase in the balances
of these businesses in the 12 months ending
January 27, 1960, appears to have reflected
a continued growth in need for cash. How
ever, the increase in their balances was evi
dently less than the increase in their use of
cash. In January 1960 demand deposits at
337 centers outside New York City and six
other leading centers were turning over 6 per
cent faster than they were a year earlier, and
industrial production was up 10 per cent.
Nonfinancial businesses also expanded their
holdings of liquid assets during the year, as
interest rates moved upward. A large part
of these assets were invested in short-term
U. S. Government securities.1
Personal deposits of individuals, which ac
count for about 30 per cent of the total, in
creased by $600 million in the year ending
January 27, 1960, two-fifths as much as
the exceptionally large growth of the preced
ing 12 months. The past year’s increase ac
companied a continued growth in disposable
personal income, but its pace was slower
than that in income. The slower growth in
deposits probably reflects continued prefer
ence by individuals, as well as other holder
groups, for interest-bearing types of liquid
assets when interest rates are relatively high.
Balances of farm operators declined
nearly 11 per cent this year to the lowest
levels reported since the Survey was under
taken on the new basis in January 1957.
The decline more than offset last year’s in
crease and appears to reflect the sharp reduc
tion in net farm income during the year.
Increased production expenses and a decline
in prices received by farmers more than
offset the gains in income from larger output.
The relatively large decline in deposits of
trust departments of banks this year offset
1 See also article “Money and Bank Credit in 1959“
in the Bulletin for February 1960, pp. 119-25.
Table 2
Demand Deposits of Individuals, Partnerships,
and
By Federal Reserve District and
by
Corporations, January 27, 1960
Type of Holdfr
Amount (in billions of dollars)
Number (in millions)
Type of holder
Federal Reserve
district
All
holders
Finan
cial
busi
ness
Nonfinan-
Farm
busi-
ators
Type of holder
Individ
uals—
per
sonal
All
other1
All
holders
Finan
cial
busi-
Nonfinancial
busi-
Farm
Individ-
ators
personal
All
other*
All districts......................
57.1
0.4
5.6
3.0
44.9
3.1
109.5
9.6
54.9
4.4
32.3
8.4
Boston...................................
New York............................
Philadelphia.........................
2.7
5.8
2.9
0. 1
0.1
P)
2.2
4.6
2.3
0.1
0.3
0.2
6.1
21.2
6.5
0.6
1.9
0.7
3.5
12.6
3.2
0.1
0.1
(9
1.5
4.3
1.9
0.5
2.3
0.6
Cleveland..............................
Richmond.............................
Atlanta..................................
4.3
5.2
5.6
P)
P)
P)
P)
P)
0.4
0.8
0.3
0.4
0.4
0.5
0. 1
0.3
0.2
3.5
4.1
4.5
0.3
0.3
0.3
8.7
6.7
8.1
0.8
0.6
0.8
4.5
2.9
3.8
0.1
0.3
0.3
2.6
2.1
2.7
0.7
0.8
0.5
Chicago.................................
St. Louis................................
Minneapolis..........................
7.5
4.2
2.5
0.1
0.8
0.3
0.2
0.6
0.5
0.4
5.7
3.2
1.7
0.4
0.2
0.2
16.9
5.0
2.9
1.4
0.3
0.2
9.0
1.9
1.1
0.8
0.5
0.5
4.5
2.0
1.0
1.2
0.3
0.2
Kansas City..........................
Dallas....................................
San Francisco......................
4.4
4.3
7.7
0.4
0.4
0.8
0.4
0.3
0.2
3.3
3.4
6.4
0.3
0.2
0.3
7.2
7.8
12.5
0.6
0.7
1.2
3.2
3.2
6.0
0.7
0.6
0.5
2.4
3.0
4.2
0.3
0.3
0.7
0. 1
p)
P)
P)
P)
0. 1
> Nonprofit organizations, trust departments of banks, and for
eigners.
2 Less than 5(1,000 accounts.
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2 Less than $50 million.
Note.—Details may not add to totals because of rounding.
369
OWNERSHIP OF DEMAND DEPOSITS
a part of the increase reported a year ear
lier. As indicated at that time, there are few
of these accounts and changes in their bal
ances do not affect the total importantly.
Deposit balances held by trust departments
are influenced by interest rates, the condition
of the stock market and capital markets gen
erally, and other financial factors. De
posits of foreign holders, which may also be
influenced by these factors, changed little.
Deposits of financial businesses, too, were
almost unchanged in the year ending January
27, I960. A small reduction for noncorpo
rate firms more than offset a slight increase
for corporations. The degree of change
in their holdings during this period reflects
their sensitivity to trends in interest rates.
After the reduction in their demand deposits
last year, a development attributed in part to
their purchases of long-term Treasury bonds
offered in late January 1959, financial busi
nesses appear to have kept new funds in
vested as interest rates moved upward.
The rise in balances of nonprofit organiza
tions in the current year was about in line
with the usual expectation for this holder
group. The rise this year more than offset a
slight decline in these balances in the year
ending January 28, 1959.
NUMBER OF ACCOUNTS
Continued growth in the number of per
sonal accounts of individuals and an increase
in the number of accounts of corporate busi
ness firms accounted for the over-all in
crease in the number of accounts of individ
uals, partnerships, and corporations in the
year ending January 27, 1960. A small de
cline in the number of accounts of farm
operators, possibly associated with a con
tinued reduction in the number of independ
ent farm operators, was offset by a small in
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crease in the number of accounts of nonprofit
organizations. The number of accounts of
other ownership groups changed very little
during the year.
Except in the case of corporate businesses,
the relative change in number of accounts
held by each of the more important owner
ship groups was roughly proportional to the
change in total deposits held by the group.
Multiple-account holding by corporate busi
ness firms is common and the decision to
open an account may be related to many
factors including the desire to establish a
credit line at a particular bank and internal
cash-management practices. Thus, shortTable 3
Ownership
to Size
of
of
Demand Deposits Related
Bank, January 27, I960
[Percentage distribution within size group]
Size of bank (total deposits, in
millions of dollars)
Type of holder
Un
der
2
210
1050
50- 250- 1,000
and
250 1,000 over
Number of accounts
All holders.............................. 100.0 100.0 100.0 100.0 100.0 100.0
Domestic business.....................
8.2
9.3 10.7 12.6 13.9
Corporate............................
Noncorporate......................
1.7
6.4
2.5
6.8
Financial..............................
Nonfinancial.......................
0.6
7.6
0. 7 0.8 0.9 1.2 0.9
8.6 10.0 11.8 12.7 11.8
Nonprofit organizations...........
Farm operators..........................
Individuals—personal...............
All other1....................................
3.9
6.8
5.6
7.0
6.4
7.4
12.6
5.4
7.3
7.6 5.7 4.4 4.2 4.1
3.0
14.7 7.3 2.1
1.0 1.2
1.0
69.3 77.6 82.6 82.0 80.5 82.6
0.1 0.1 0.2 0.1 0.3 0.9
Amount of deposits
All holders..................
100.0 100.0 100.0 100.0 100.0 100.0
Domestic business.........
30.5 40.2 52.3 66.5 69.5 71.4
Corporate...............
Noncorporate........
13.6 22.5 34.4 54.1 58.1 62.2
16.9 17.6 17.9 12.4 11.4 9.3
Financial.................
Nonfinancial...........
3.4 5.0 8.0 10.1 12.3 9.2
27.1 35.2 44.3 56.4 57.2 62.2
Nonprofit organizations
Farm operators.............
Individuals—personal..
All other1........................
5.2 4.8 5.5 4.1 4.2
5.1
1.0 0.7
20.7 10.5
1.8 0.8
43.3 43.1 38.0 24.5 22.0 18.7
0.4 1.0 3.0 2.7 3.4 5.0
1 Trust departments of banks and foreigners.
Note.—Details may not add to totals because of rounding.
370
term changes in the number of accounts held
by these firms are probably not very sig
nificant.
OTHER CLASSIFICATIONS
Data on the ownership of demand deposits
by Federal Reserve districts are shown in
Table 2. District comparisons should be
made with care since the statistics not only
reflect regional differences but also are af
fected by sampling errors.
Table 3 shows the distribution of deposits
by ownership groups within bank-size
classes. A similar table, based on the 1957
Survey, was published in the Bulletin for
May 1957, page 514. Comparison of the
data for the two Surveys indicates that no
important changes have occurred in this
over-all distribution.
STATISTICAL NOTE
Estimates of sampling errors for various
Survey statistics are shown in Table 4. These
estimates are based on the 1959 and 1960
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Federal Reserve Bank of St. Louis
FEDERAL RESERVE BULLETIN • APRIL 1960
Survey results. Additional computations of
sampling errors for the estimates of deposit
holdings and of changes in deposit holdings
of the various combinations of ownership
groups, such as all nonfinancial business,
will be made later this year in order to pro
vide measures of reliability for all Survey
statistics.
Table 4
Estimated Sampling Errors for Survey
of Demand Deposit Ownership
Standard deviations
(in millions of dollars)
Type of holder
Deposits
outstanding
Jan. 28, 1959
Change in
deposits,
Jan. 28, 1959 to
Jan. 27, 1960
Financial business:
Corporate................................
Noncorporate.........................
Nonfinancial business:
Corporate................................
Noncorporate.........................
450
175
400
200
2,000
350
1,125
375
Nonprofit organizations...............
Farm operators................................
Individuals—personal....................
Trust departments of banks.........
Foreign holders...............................
250
175
550
275
50
225
175
575
275
50
Note.—All estimates rounded to nearest $25 million.
@FedFRASER