Full text of Review (Federal Reserve Bank of Dallas) : July 1967

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business
•
rev.elV

july 1967

fEmERAL RESERVE
BANK Of DAllAS

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

contents

bank earnings and
monetary policy . . . . . . . . . . . . . . . . . . . . . . . . . . . .

3

agricultural loans in
the eleventh district . . . . . . . . . . . . . . . . . . . . . . . . .

8

district highlights .... .. .. . . . ... . .. . . . . . . . . . 13

bank earnings and
IIIonetary policy
The primary purpose of monetary policy
involves the supplying of an adequate quantity of money and credit in order to foster full
employment of available resources, a stable
price level, economic growth, and balance in
international accounts. To achieve its goals,
the Federal Reserve System relies upon a number of tools and techniques, the most important
?f which are open market operations, changes
tn reserve requirements, and changes in the disCOUnt rate of the Reserve banks. While the
goals of monetary policy are quite broad, it
should be noted that the System's three basic
tools are very specific, operating through the
commercial banking system and financial markets. As a result, it may be expected that the
Bederal Reserve System, in conducting monetary policy, also has an impact on the level of
bank earnings.
At first glance, however, the effects of monetary policy on bank earnings are not entirely
clear. It is not at all certain whether "tight"
money, for example, is associated with high
prOfits Or low profits since credit restraint has
a number of diverse effects upon bank earnings.
Thus, in periods of tight money, profits tend
to increase because of higher interest rates on
loans and on newly purchased securities but
tend to decline because of the higher rates paid
on time and savings deposits, the slower growth
of earning assets, and losses on the sale of secUrities. Conversely, in periods of credit ease,
prOfits tend to rise as a result of the lower rates
on time and savings deposits, the more
Pld rate of growth of earning assets, and
on the sale of securities but tend to
i as a result of lower returns on loans and
nVestments.

The purpose of this article is to ascertain
whether, in the recent past, there has been a
relationship between the posture of monetary
policy and the level of member bank profits in
the Eleventh Federal Reserve District. However, it must be recognized that there are a
number of difficulties inherent in any such
study. In the first place, the impact of credit
restraint or credit ease need not necessarily
exhaust itself during the period of the posture
of monetary policy; that is, a particular stance
of monetary policy may have an impact on
bank profitability after the policy has changed.
In addition, it must be recognized that there
are substantial limitations involved in the measurement of bank profitability. For example,
the use of net profits after taxes may be biased
due to the range of discretion available to bank
management in deciding when to take profits
and losses on securities, which, in turn, reflects
the tax laws applicable to banks and, also,
variations in tax rates among different sizes
of banks.
To ascertain the relationship between monetary policy and bank earnings, the level of bank
earnings in periods of credit restraint is compared with the level of profits in periods of
credit ease over a 14-year period, 1952 through
1965. 1 Comparisons are made for the "average"
member banks in the District and for those
1 The methodology employed in this article is similar
to that used in a study related to monetary policy and
bank earnings for the Nation. See William J. Brown,
Tight Mon.ey and Bank Profits, Research Paper No.1 ,
Department of Economics and Research, The American Bankers Association, 1967. For another discussion
of this question, refer to Don L. Woodland, "Diagnosing the Deterioration of Bank Profits," Th e Bankers
Maga zine, Vol. 149, No.2 (Spring 1966), pp. 35-43.

business review/ july 1967

3

member banks with deposits of over $100 million. 2 The latter category is included since it
is the larger banks which, because of the careful management of their liquidity position, tend
to react more quickly to changes in monetary
policy. Since the modal deposit-size group of
banks (i.e., that size group which contains the
largest number of banks) is composed of banks
with deposits between $2 million and $5 million,
a comparison between the "average" bank in
the District and those banks with over $100
million in deposits may be thought of as a
comparison of the impact of monetary policy
on small banks and large banks.
From an analysis of these data, it is apparent
that net current operating earnings as a percentage of total capital accounts, on the average, are higher in periods of "tight" money than
in periods of "easy" money for both the average member bank in the District and the member banks with deposits of over $100 million.
In contrast, net profits after taxes (a measure
which is adjusted for gains and losses on securities and for charge-offs and recoveries on
loans, as well as taxes) for the larger banks
generally are lower in periods of tight money
than in periods of easy money. For the average
member bank, on the other hand, there seems
to be little difference in this measure of profitability between periods of easy money and tight
money. One of the most important reasons for
the divergent movement in these two measures
of profitability is that banks, particularly the
larger banks, usually sustain losses on their
securities during periods of tight money and
realize profits from the sale of their investments
during times of easy money.8
2 The data used in this study are taken from the
operating ratios published each year by the Federal
Bank of DalJas. These data are averages of
mdlVldual bank data and, thus, give equal weight to
each bank. As a result, they will not necessarily agree
with ratios computed from aggregate data.
8 These data are inherently biased by the fact that
banks, for Federal tax purposes, may deduct security
losses from income.

In addition, it is interesting to note that in
1966, a year of considerable restrictiveness in
monetary policy, bank earnings only partially
conformed to this pattern. As a percentage of
total capital accounts, net current earnings and
net profits after taxes both increased over
their 1965 levels for the "average" member
bank in the District; but at the large bankS,
while net current operating earnings as a percentage of total capital accounts increased, net
profits after taxes as a percentage of total capital accounts declined slightly.
In order to assess the association between
monetary policy and the level of bank earnings,
it is first necessary to select an appropriate
measure of each. While there are a number of
reasonable alternatives, each with its separate
limitations, the measure used in this study as
an indicator of the posture of monetary pollcy
is the average level of free reserves for aU
member banks in the Nation. (Free reserves
are defined as excess reserves of member banks
less borrowings from the Federal Reserve banks
and, thus, are a rough measure of the capacity
of banks to expand credit. It should be recognized, of course, that the relationship of theSe
two variables may change over time and, with
the development of the Euro-dollar and Federal
funds markets in recent years, may not be as
clear as previously.) If free reserves were positive during a particular period, this span is
characterized as one of "easy" money; if free
reserves were negative, the period is characterized as one of "tight" money.
As a measure of bank earnings, both net
current operating earnings and net profits after
taxes as a percentage of total capital accounts
are employed. Net current operating earnings
are the result of the deduction of current operating expenses (consisting principally of wages
and salaries and the interest paid on time and
savings deposits) from current operating revenue (primarily the interest received on
and investments). Net income after taxes IS

derived from net current operating income by
adding recoveries on loans and investments,
transfers from valuation reserves, and profits
on the sale of securities; subtracting losses on
securities sold, charge-offs on securities prior
to sale, and transfers to valuation reserves; and
then deducting income tax payments from the
remainder.
Both quantities are then divided by total
capital accounts in order to obtain the rate of
return on capital. In the business and investor
decision process whereby capital is allocated
among industries, it is the prospective return,
either short- or long-run, on capital which is
of primary importance. Net profits are measUred after taxes in order to allow for the growing sigruficance of tax-exempt municipal securities in the portfolios of the District's banks.
The use of after-tax profits does introduce a
slight bias, however, in that it fails to allow for
changes in tax laws over the period.
Through 1961, profits of District member
banks were reported semiannually; since then,
prOfits have only been reported annually. In
this discussion, a "period" covers a semiannual
span through 1961 and an annual span after
1961. To make the data comparable, the semiannual figures have been adjusted to annual
rates. It should be recogruzed, of course, that
the use of semiannual data may result in some
distortion due to seasonal factors. However, in
the semiannual periods, there were equal instances of credit restraint and of credit ease.
In the 14 years under consideration, there
Was a total of 24 periods, 20 semiannual
periods from 1952 through 1961 and 4 annual
periods from 1962 through 1965. Among these
24 periods, there were roughly equal numbers
of periods of easy and tight money: 13 periods
easy money and 11 periods of tight money.
it must be kept in mind that
penods of credit restraint and credit ease do
not necessarily correspond to semiannual or
annUal periods; thus, the characterization of

a particular period as one of easy money or
tight money is only an approximation.
When net current operating earnings as a
proportion of total capital accounts are averaged separately for the periods of easy and
tight money, it is found that the return on
capital for the average District bank in periods
of tight money exceeded the return in periods
of easy money by 1.2 percentage points -15.8
percent, as compared with 14.6 percent. However, when net profits after taxes are used as
the measure of profitability, the return on capital is identical between the periods of tight and
easy money, 8.4 percent in periods of tight
money and 8.4 percent in periods of easy
money.
The association between monetary policy and
the level of bank earnings is perhaps more
marked in the case of the larger banks. For
these banks, net current operating earrungs as
a proportion of total capital accounts averaged
18.2 percent in periods of tight money and
16.9 percent in periods of easy money. In contrast, the proportion for net income after taxes
averaged 8.6 percent in periods of tight money
and 9.1 percent in periods of easy money.
One of the principal reasons for the divergent
behavior of net current operating earnings and
net profits after taxes, particularly at the larger
banks, was the variation in security profits and
losses between the periods of tight and easy
money. Thus, in periods of tight money, banks
sold or redeemed securities in order to meet
their loan demands. Since interest rates were
high, the banks often had to - or, for tax purposes, chose to - sell these securities at a
loss; this loss is a deduction from net current
operating earnings and reduces net profits.
Similarly, in periods of easy money, with low
interest rates, banks were able to sell their
securities at a profit.
In periods of tight money, the average member bank in the District absorbed security

business review/july 1967

5

RELATIONSHIP BETWEEN FREE RESERVES AND GAINS OR LOSSES ON SECURITIES
NET GAINS OR LOSSES ON SECURITIES.
ELEVENTH FEDERAL RESERVE DISTRICT
LARGE MEMBER BANKS'
ALL MEMBER BANKS

FREE RESERVES.
ALL MEMBER BANKS
IN UNITED STATES

1952

1954

1956

1958

1960

1962

1964

1966
, ,

-400

,

I

-.60

,

-.30

MilliONS OF DOLLARS

o

,

,

+.30

1

I

I

,

+.60

,

J

+.90

•

-.20

0

+.20

PERCENT OFTOTAL SECURITIES

'Banks with average depoolts of over $100 million.
SOURCES: Board of Govornors. Fedoral Roservo System.
Fod.ral R••• rve Bank of Dallas.

I

losses of .10 percent of the value of its securities
but, in periods of easy money, obtained a profit
of .08 percent of the value of its securities.1
For the larger banks, the variation between the
periods of easy and tight money is even more
striking. Thus, in periods of tight money, these
banks absorbed security losses of .27 percent;
in periods of easy money, they obtained gains
on the sale of their investments equal to .32
percent of the dollar value of these securities.
It should be pointed out again, of course, that
these results are partially brought about by the
tax laws applicable to commercial banks.
'1 The
data available, from the operating ratios,
for secunty profits and losses are on an annual basis.

6.

The data discussed above suggest a number
of conclusions with regard to the association of
monetary policy and bank earnings. In periods
of tight money, net current operating earnings
expand, primarily because banks obtain a
larger return on their loans and investments.
This expansion occurs for both the average
bank in the District and the larger banks. These
earnings are reduced, however, chiefly by losses
the banks incur as they liquidate investments
in order to establish tax losses or to meet loan
demands. This process reduces net profits after
taxes as a percentage of total capital accounts
so that the proportion is roughly equal in periods
of tight and easy money for the average
bank in the District and is lower in periods 0

I
l
(

tight money than in periods of easy money for
the larger banks.
eviIn 1966, this pattern was only
dent. While net current operating earmngs as
a percentage of total capital accounts increased
and net profits after taxes as a percentage of
total capital accounts declined at the larger
banks, both measures of profitability rose at
the average District bank. It may be noted,
also, that both net current earnings and net
income after taxes as a proportion of total
capital accounts decreased at those banks with
Over $500 million in average deposits.
For the average member bank in the District,
the return on loans, surprisingly enough, did
not advance (7.31 percent in 1966 versus 7. 34
percent in 1965), but the bank apparently was
able to increase its earning assets and its return
on securities sufficiently to offset rising expenses,
particularly on time deposits (the average rate
paid on time and savings deposits advanced
from 3.63 percent in 1965 to 3.81 percent in
1966), and the losses on its security transactions (.12 percent in 1966 versus .03 percent
in 1965) . For the larger banks, while net current operating earnings expanded, the growth
Was not nearly as large as for the average bank
in the District.
In the case of the larger banks, the increase
in earnings reflected higher earnings on secur-

ities and on loans; the average interest received
on loans rose from 5.71 percent in 1965 to
6.01 percent in 1966. However, this
in earnings was more than offset by the rIse III
interest paid on time deposits (the average interest rate paid on time and savings deposits
rose from 3.79 percent in 1965 to 4.07 percent in 1966) and by losses on securities (.41
percent in 1966 versus .04 percent in 1965).
As a result, net profits after taxes as a percentage of total capital accounts declined between
1965 and 1966.
The inherent limitations of the method and
the data used in this study make it necessary
to generalize very cautiously. It may, nevertheless, be concluded that the often-held viewpoint that bank profits are substantially higher
in periods of credit restraint than in periods
of credit ease is not supported by the data presented for member banks in the Eleventh Federal Reserve District from 1952 through 1965.
While net current operating earnings were
somewhat higher in the periods of credit restraint than in the periods of credit ease, net
profits after taxes were unchanged or lower.
It may also be concluded that the association
between monetary policy and the level of bank
earnings varies considerably with the size of
bank involved.
DONALD R. FRASER

business review/july 1967

7

ag,·icultu,·al loans in
the eleventh dist,·ict
Agricultural loans made by banks in the
Eleventh Federal Reserve District increased
sharply during the past decade. As those
familiar with farm financing are aware, the
outstanding indebtedness of the average agricultural borrower at District banks also has
risen sharply. The increase in total lending and
the growth in the size of individual loans reflect the expansion of farm and ranch operations
and the uptrend in the cost of items used in
production and for family living. Various aspects of financing agricUlture in the Southwest
are revealed in the results of the farm loan
survey conducted by the Dallas Federal Reserve
Bank in mid-1966 among insured commercial
banks as a part of a nationwide study by the
Federal Reserve System. In the Eleventh District, the 156 banks requested to cooperate in
the survey all provided detailed information regarding their lending to farmers and ranchers. 1
As of June 30, 1966, banks in the District
had total outstanding farm loans of $899 mil1 The data were provided by a stratified random
sample consisting of 156 insured commercial banks.
Each bank provided detailed information on a sample
of its farm loans, together with certain other information. All insured commercial banks in the District
were stratified by size, as measured by the dollar
volume of farm loans outstanding, in order to select
the sample of banks. Included in the sample were all
banks with $3
or more in farm loans, 15 percent of the banks WIth $2,000,000 to $2,999,999 in
such loans, and smaller proportions of banks in seven
other loan-size groups. Each respondent bank reported
on all farm borrowers with $100,000 or more of debt
outstanding and on 20 to 50 additional farm borrowers having surnames within a designated alphabetical segment. The sample data were expanded on
the basis of the total of all farm loans outstanding
which was compiled from the reports of condition of
District commercial banks as of June 30, 1966.

8

lion, as compared with $407 million on the
same date in 1956. Despite the fact that the
loan volume more than doubled in the 10-year
period, the increase was somewhat less than
that for the Nation. The average indebtedness
of farm borrowers in the District during this
period, growing at a moderately faster rate
than that for the Nation, rose from $2,431 to
$6,696. The growth in farm lending results
from many factors, such as advances in the
size of farms, in prices paid, in land valueS,
and in purchases of production items.
Modern farming has required an increasing
volume of capital, and loan size has grown
rapidly. However, very few of the loans at the
banks, as of June 30, 1966, had required participation with other banks; legal loan limits
restrict the amount a bank can lend to anyone
borrower. Banks continue to enter into loan
participation agreements with other banks in
order to serve more completely the agricultural
credit needs of their community. Individual
notes of $25,000 and over accounted for about
two-fifths of the total amount of outstanding
farm debt, and most participation loans involve such large notes. About 1 percent of the
number of notes and almost 6 percent of the
dollar amount of debt outstanding at mid-196 6
were participated.
Also, the volume of purchased agricultural
notes in the District was modest. Only 3 percent of the total number of notes and of the
volume of indebtedness on June 30, 1966, represented purchased paper. The purchased
originated from sales by smaller banks to theIr
correspondent banks, from the acquisition of
notes guaranteed by the Farmers Home Administration, and from notes made by merchants

TOTAL BANK DEBT OUTSTANDING OF
FARM BORROWERS, JUNE 30, 1966
Eleventh Federal Reserve District

Amount of debt

__ per borrower

Under $500 ........
$500 to $999 .......
$1,000 to $1,999 .... .
$2,000 to $4,999 .. . ..
$5,000 to $9,999 .....
$10,000 to $24,999 ..
$25,000 to $49,999 ..
$50,000 to $99,999 . .
$100,000 and over . ..
Total .. . .........
NOTE. _

Number
Borrowers

19,023
18,534
2 1,351
32,997
18,740
16,582
4,858
1,770
445
134,299

Loans
21,570
26,674
33,224
64,502
47,822
51,865
20,475
6,323
274,196

Amount
outstanding
(In
thousands)

Average
effective
interest rate
(Percent)

5,116
12, 778
29,321
103,428
128,155
241 , 115
167,859
115,562
95,927
$899,259

9.2
8.9
8.3
8.0
7.4
7.2
6.9
6.4
6.0
7.1

$

Details may not add to totals because of rounding.

Or dealers with agricultural customers to cover
Credit sales of supplies and equipment. The
lllodest volume of purchased paper reflects the
traditionally personal nature of agricultural
lending.
While lines of credit are being established
by more banks, 31 percent of the total dollar
Volume of loans outstanding was extended on
this baSis, and 16 percent of the farm borrowers
had lines of credit as of mid-1966. Again, the
relatively small number of borrowers with lines
of credit probably reflects the long-standing
bank and farm client relationship that exists
with respect to the seasonal credit needs of
farm borrowers.

borrower characteristics
A.s would be expected, the higher the net
Worth of borrowers, the greater was their share
of the total agricultural debt outstanding. Farmers with a net worth of $25,000 and over repless than one-half of the number of
f onowers but accounted for about threeOUrths of the total loan volume. Farmers with
net Worth of $100,000 and over usually are
OSe haVing larger farm operations and, thereOre, require more farm credit. Although combrising only 14 percent of the number of
orrowers, farmers in this higher net worth
category owed about 46 percent of the total

debt outstanding. Farm borrowers with a higher net worth
often have specialized enterprises that require large
amounts of capital for full utilization of resources. Farm borrowers with a net worth of less
than $10,000 constituted a
large percentage of the number
of borrowers but accounted
for less than 10 percent of the
volume of bank credit.

The age of the borrower is
related to the amount of debt
incurred, net worth, and size
of operation. More than four-fifths of the loan
volume was granted to farmers over 35 years
of age. Farmers 45 years of age and older accounted for about 60 percent of the volume of
debt and of the number of borrowers. Furthermore, this age group had about three-fourths of
the total net worth. Since the average age of
farmers in the District is slightly over 50
years, the fact that a majority of the farm credit
was extended to relatively older farmers is to
be expected. Many of the younger farmers
(those under 35 years of age) have not been
farming long enough to amass the resources
necessary to support a large debt.

Among the tenure groups, owner-operators
constituted the largest number of farmers in
the District; therefore, it was expected that
this tenure group would have the greatest loan
volume outstanding. Tenant farmers, on the
other hand, are declining in number and accounted for a minor share of the farm debt.
Although farm corporations are relatively few
in number and had less than 5 percent of the
loan volume, the average amount of debt outstanding per corporation borrower was more
than seven times that of the owner-operator.
Many family farms have grown to such a large
size that incorporation becomes desirable because of risk, liability, and accounting procedures. Naturally, the financial requirements

business review/july 1967

9

CHARACTERISTICS OF FARM BORROWERS AT BANKS, JUNE 30, 1966
Eleventh Federal Reserve District
Fa rm borrowers
As percent
of tota l

De bt outstanding
Amount
As rerce nt
o total
(In thousa nds)

Ave rage
de bt pe r
borrower

Characteristic

Number

Net worth of borrower
Under $10,000 .. . ..... . ... .. .... . .
$10,000 to $24,999 . . . ... . ......... .
$25,000 to $99,999 . ... . . . ... .. . . . . .
$100,000 and over . . . . .. . .... .
Not reported
..... .. ... .. .
Total

31,544
34,306
34,973
18,740
14,736
134,299

23.5
25.5
26.0
14.0
11.0
100.0

$ 60,654
129,349
239,349
411,770
58,138
$899,259

6.7
14.4
26.6
45.8
6.5
100.0

$ 1,923
3,77 0
6,84 4
21,973
3,945
$ 6,696

Age of borrower
Under 35 ... . ... . . . .. ....... .
35 to 44 ....... .. .... . . . ... .. .
45 and over .. . . .. ... . . . . . ... ..
Total ............ . ... .. . . ..

... .
....
...•
....

21,902
31,597
77,720
131,219

16.7
24.1
59.2
100.0

$ 123,664
190,547
515,431
$829 ,642

14.9
23 .0
62 .1
100.0

$ 5,646
6,030
6,632
$ 6,323

Tenure of borrower
Owner·operators . . . . .
. .. ...... .
Tenants
.... .. ... . ... . .... .. . .
Landlords . . ... . ....... . ......... .
Corporations ... . ...... . . . .. . .. ... .
Not reported .. . ..... . ...... .
Total .. . ... .. .. . . . . ... . .. . . ... .

93,3 27
33 ,345
5,002
385
2,241
134,299

69.5
24 .8
3.7
.3
1.7
100.0

$709,147
136,798
19,732
22,809
10,774
$899,259

78.9
15.2
2.2
2. 5
1.2
100.0

$ 7,599
4,102
3,945
59,248
4,808
$ 6,696

NOTE. -

Details may not add to tota ls because of rounding.

increase as more resources are placed under
the direction of one management.
Farm borrowers with outstanding bank debts
of $10,000 to $24,999 accounted for more than
one-fourth of the agricultural loan volume.
Borrowers incurring a debt in this range generally represented the larger than average farm
unit. Indebtedness of less than $5,000 characterized more than two-thirds of the borrowers, but these debts represented less than 20
percent of the loan volume. The number of
notes per borrower increased in relation to the
dollar amount. Loans of less than $1,000 were
usually made on a single note, while debts
above $2,000 required from two to six notes.
The variation in the number of notes is related
to the purpose, maturity, and security of the
different loans, as well as the size of loans.
Farmers with meat animals as their major
enterprise led all other types of farm borrowers in the amount of outstanding debt, accounting for 36 percent of the total. The second
largest demand for farm credit came from

10

-

the farmers with several enterprises, none of
which was of dominant importance. Many
farmers find that diversification reduces risk
and, also, makes more complete use of their
resources. Producers who were operating cotton
farms ranked third in farm debt outstanding,
followed closely by producers of cash grain.
The four major types of farmers accounted for
over 90 percent of the total outstanding debt,
number of borrowers, and number of notes.

loan characteristics
Loans for paying current operating and
family living expenses represented a larger proportion of volume and numbers than loans for
any other purpose, accounting for about 43
percent of the total dollar volume and 56 percent of the number. This large percentage of
total volume is in keeping with the longtilll e
trend. The use of more purchased itemS of
production - such as fertilizers, insecticides,
and herbicides - and of more machinery baS
sharply increased current operating costs. Bank
loans for all intermediate-term investments (for

example, purchases of farm equipment and
consumer durables) represented almost 30 percent of the volume. When combined, loans for
these two major purposes accounted for over
70 percent of both the outstanding debt and
the number of notes.

comprised of loans of $10,000 and over. The
largest dollar amount of debt was accounted
for by loans in the $10,000-$24,999 category,
while the greatest numbers of loans were in the
$1,000-$5,000 range. In terms of dollar volume, about 70 percent of the loans were for
an original amount of more than $5,000.

Loans for the purchase of feeder cattle
ranked third in volume and considerably ahead
of borrowings for the purchase of real estate.
The expansion of feedlot facilities and the
tripling of the number of cattle fed in the District during the past 10 years have required a
tremendous increase in livestock financing. The
average size of loan was largest for the purchase
of farm real estate, and the smallest loans were
those made for buying automobiles and other
consumer durables.

Average effective interest rates decreased
as the amount of bank debt per borrower rose.
This relationship is expected since the larger
amounts are generally associated with increasing net worth, larger units, and older and more
established farmers and ranchers. A large proportion of the loans (85 percent of the dollar
volume and 82 percent of the number) had
interest rates ranging from 6.0 percent to 8.9
percent. There were relatively few loans that
had extremely low or high interest rates.
Slightly over 6 percent of the loan volume had
effective interest rates of 9 percent or more,

Based on survey information on the amounts
of original notes, over 50 percent of the District's outstanding farm debt at mid-1966 was

CHARACTERISTICS OF AGRICULTURAL LOANS AT BANKS, JUNE 30, 1966

-

Eleventh Federal Reserve District

-

Characteristic

Number
of
loans

As
percent
of tota l

28,327
30,605
45,227
60,718
60,990
26,366
15,817
4,260
1,395
491
274,196

10.3
11.2
16.5
22 .1
22.2
9.6
5.8
1.6
.5
.2
100.0

Amount
outstanding
(In
thousands)

As
percent
of total

4,030
10,125
28,196
72,901
160,687
151,301
199,732
115,788
80,075
76,424
$899,259

0.4
1.1
3.1
8.1
17.9
16.8
22.2
12.9
8.9
8.5
100.0

$

Average
original
amount

Average
effective
interest rate
(Percent)

Size of loan
Under $250 ...... . . ... .. ..
$250 to $499 . . ............ . . .. ....
$500 to $999 ... . ... .. . . ... . .......
$1,000 to $1,999 . .. .. . .............
to $4,999 . ........ . .. .. .... .
$5,000 to $9,999 . .. ... . . . .. . . . .. . ..
$ 10,000 to $24,999 . . . . .... . . . ... .. .
$25,000 to $49,999 ..... .. .. . ..... . .
$ 50,000 to $99,999 . .. .. . ....... . ...
100,000 and over .. . .... . .. . .. .. ..
Total

"

"

"

""

.

.. . .. .. ... .. . , .

MajOr Purpose of loan
feeder livestock .....
operating and family
AI IVlng expenses ... . .... .. ....... .
I Intermediate.term investments ... .
Other livestock . ..
EqUipment ......................
Automobiles and consumer durables
B Land and buildings .... .. .........
Cuy fa rm rea I estate .... , .. . .. . .. "
onso l idate or pay debts . . .. . .... . . .
Other .....
. , ... , . . ......... , ' , .
Total
. "
.......... , ... ....

---

NOTE. _

$

15,897

5.8

$121,812

13.5

153,692
85,275
35,882
34,130
12,360
2,903
10,232
3,216
5,883
274,196

56.1
31.1
13.1
12.4
4.5
1.1
3.7
1.2
2.1
100.0

382,492
265,086
141,652
90,560
14,758
18,116
77,829
18,764
33,275
$899,259

42.5
29.5
15.8
10.1
1.6
2.0
8.7
2.1
3.7
100.0

198
346
659
1,295
2,937
6,518
14,097
32,266
63,941
194,124
$ 3,717

8.6
8.5
8.3
7.9
7.6
7.2
7.0
6.8
6.3
5.9
7.1

$

8,371

6.5

$

2,759
3,585
4,368
3,085
1,527
8,549
9,602
6,372
6,380
3,717

7.2
7.5
7.1
7.7
9.6
7.3
6.5
7.2
6.4
7.1

Details may not add to totals because of rounding.

business review/july 1967

11

as contrasted to the 1 percent with rates below
the 5-percent level. Effective interest rates for
all agricultural loans at the District banks as
of June 30, 1966, averaged 7.1 percent.
The maturity of a loan is determined, to a
large extent, by its purpose. In the Eleventh
Federal Reserve District, loans with maturities
of 6 months or less comprised the largest proportion of both the debt outstanding and the
number of notes. Notes made to mature within
1 year accounted for 83 percent of the loan
volume and 88 percent of the total number of
loans. The preponderance of notes with maturities of less than a year reflects the large
proportion of debt incurred for current operating and family living expenses and for the purchase of feeder cattle. Loans for financing farm
equipment, automobiles, and other durable
goods had longer maturities - from 1 to 3
years - and represented the third largest volume. Loans to purchase and improve farm
real estate generally had maturities of 5 years
or more.
Security for any loan may take one of several
forms. The demonstrated ability of some borrowers to repay may be sufficient to make an
unsecured loan. Although the proportion of
unsecured farm notes was smaller than 1 years
ago, 13 percent of the total dollar volume was
made on this basis as of June 30, 1966. The
most prominent security for notes in both 1956
and 1966 was the chattel mortgage, and the
percentage of the dollar volume secured in this
manner increased from about 66 percent in
1956 to 70 percent in 1966. Mortgages on

°

12

farm real estate served as security for 11 percent of the total dollar amount of outstanding
farm debt.
The renewal of notes does not necessarily
indicate that the borrower is unable to meet
the original terms of the loan. This assertion
is borne out by the fact that 14 percent of
the notes were planned renewals, as compared
with 5 percent that were unplanned. Planned
renewals involve an understanding between the
borrower and the lender at the time the note
is drawn. A majority of the renewals not
planned resulted from unexpected declines in
farm income, which may, and often do, occur
because of natural hazards. As of June 30,
1966, over 80 percent of the notes (accounting
for about 70 percent of the total dollar volume)
had not been renewed. Further, there were no
notes that were overdue more than 32 dayS,
and those that were overdue represented lesS
than 1 percent of both the number and the
dollar volume.
Repayment of loans in the District is heavily
concentrated in the single-payment category·
The method of repayment is probably related
to the large volume of loans made for meeting
current operating expenses. Although about 16
percent of the loan volume and 13 percent of
the number of notes were for instalment loans,
the remainder were accounted for by singlepayment notes. Since income derived from farfIl
marketings is mostly seasonal, the singlepayment type of loan meets many of the requirements of agricultural lending.
J. C. GRADY, JR.

distleiet highlights
The seasonally adjusted Texas industrial production index advanced neady 2 percent in
May to 154.2 percent of its 1957-59 base. The
strength exhibited during May resulted primarily from a 7-percent rise over the preceding
month in crude petroleum mining. Durable
goods production maintained about the same
level as in the prior month, with moderate gains
in most of the sectors weighed down by substantial declines in the fabricated metal and
nonelectrical machinery industries. Increases in
several sectors in nondurable goods manufacturing somewhat more than offset very slight
output decreases in the textile and apparel
industries and in petroleum refining. Except
for crude petroleum mining, the production
levels of the nonmanufacturing industries
sCarcely differed from the levels of the previous
month.
Total industrial production in the State in
May was almost 6 percent ahead of the same
month last year. The production of durable
gOods exceeded that in May 1966 by 7 percent.
The supporting strength was diffused rather
evenly among most of the durable goods sectors. Notable strength was evident in the production of transportation equipment, but a
cOUnterbalancing weakness appeared in the output of stone, clay, and glass products. NondUrable goods manufacturing was 6 percent
above a year ago, and the expansion was spread
among the sectors. The output of utiligained substantially over the like month
1n 1966.

Prompted by the disruption in oil supplies
as a result of the Middle East conflict, the
Texas Railroad Commission in mid-June
boosted allowables in the State from 33.8 perCent of capacity to 35.9 percent and made the

increase retroactive to the first of the month.
On June 23, July allowables for Texas were
lifted to 42.9 percent - the highest rate since
March 1957, when the flow of oil from the
Mideast through the Suez Canal was disrupted.
The July rate increases permissible daily production to 3,512,042 barrels, compared with
2,992,236 barrels as of June 15. Daily allowabIes in Louisiana have been boosted from the
level of 1,718,048 barrels in effect for June
to 1,916,190 barrels for July. An increase in
June output from regulated wells also was permitted, but any rise will have to be offset by a
reduction of a like amount in JUly. Acting with
caution, regulatory authorities in New Mexico
have increased the July allowable only slightly
for the southeastern part of the State.
Advancing to a total of 5,647,300 persons,
nonagricultural employment in the five southwestern states during May recorded a more than
seasonal gain of 0.4 percent. Manufacturing
employment advanced slightly, with about onehalf of the gain over April due to settlements
of labor-management disputes. Nonmanufacturing employment increased very strongly on a
seasonally adjusted basis. This increase derived
substantial support from the greater than expected employment gains in transportation and
service industries and in government, mostly
011 the state level. Employment in mining and
construction activities was weaker than seasonally expected.
Nonagricultural employment in the five states
in May was nearly 5 percent above the like
month in 1966. Manufacturing employment was
4 percent ahead of May last year, and nonmanufacturing employment exceeded its yearearlier level by 5 percent. This latter increase
reflected, in particular, the above-average gains

business review/july 1967

13

in service and government employment. Mining employment eased fractionally from a year
ago.
A new high for May was established by registrations of new passenger automobiles in four
major areas in Texas. At 19,423, combined
registrations in the four markets - Dallas, Fort
Worth, Houston, and San Antonio - were 15
percent above April and 14 percent higher
than in May 1966. The month-to-month increases in the individual markets ranged from
a 29-percent rise in Dallas to an 8-percent gain
in Houston.
Eleventh District department store sales for
the 4 weeks ended June 17 were 1 percent
above the corresponding period a year ago.
Cumulative sales this year through the same
date were 3 percent more than in the comparable period in 1966.
Rains over much of the Eleventh District in
June were, for the most part, very beneficial
for crops, although hail, heavy rains, and
flooding necessitated the replanting of a large
acreage of cotton. Soil moisture ranges from
adequate to short, and more precipitation is
generally needed to maintain plant growth. The
output of winter wheat in the five District states
is estimated, as of June 1, to be 14 percent
smaller than that of last year. Harvesting of the

new
member

1967 wheat crop is nearing completion, and
yields per acre have varied widely. The first
bale of cotton from the 1967 crop was ginned
in the Rio Grande Valley on June 11 - considerably earlier than in 1966. Rice is making
good progress, and the first cutting is under way·
The condition of livestock in the District is
fair; supplemental feeding is increasing, since
the supply of range forages is declining. There
is a shortage of stock water in some areas, and
heavy rains are needed to replenish supplies.
Reflecting the relatively greater availability
of reserves and the existence of no more than
a moderate demand for loans, total investments at the Eleventh District's weekly reporting commercial banks have increased quite
rapidly thus far in 1967. Most of this growth
has been accounted for by gains in holdings
of non-U.S. Government securities, primarilY
municipal issues.
In the period from December 28, 1966, to
June 14, 1967, total investments of the DiStrict's weekly reporting commercial banks eXpanded $133 million, or at an unadjusted
annual rate of 12.9 percent. Of the total increase, $69 million, or roughly one-half, occurred in holdings of municipal securities. V.S.
Government securities rose $26 million, and
other bonds, corporate stocks, and securities
advanced $38 million.

The University National Bank, Galveston, Texas, a newly organized institution
located in the territory served by the Houston Branch of the Federal Reserve
Bank of Dallas, opened for business June 15, 1967, as a member of the Federal
Reserve System. The new member bank has capital of $200,000, surplus of
$100,000, and undivided profits of $90,625. The offi.cers are: Alvin N. Kelso,
Chairman of the Board; John C. Fawcett, President; and Gus J. C. Oppermann
IV, Vice President and Cashier.

STATISTICAL SUPPLEMENT
to the

BUSINESS REVIEW

July 1967

FEDERAL RESERVE BANK
OF DALLAS

CONDITION STATISTICS OF WEEKLY REPORTING
COMMERCIAL BANKS

RESERVE POSITIONS OF MEMBER BANKS
Eleventh Fe deral Reserve District

Eleventh Federal Reserve District

(Ave rag.s of daily flgur.s. In thou sands of dollars)

=

(In thousands of dollars)
June 28,

It.m

1967

May 31,
1967

June 29,

Net loans and discounts .••. ••.•• ..• •.. ••• •••••
Valuation resorves .•••.••.•••••.•..••..••.•.•
Gross loons and discounts •• • ..••.•....••••.•••

5,254,942
95,520
5,350,462

5,242,130
96,216
5,338,346

4,969,251
88,459
5,057,710

Commercial and Industrial loans • •••. • •. ••..••
Agriculturalloans 2 •••••••• ••• " • • • • • • • • • • • •

2,555,112
102,359

2,508,644
98,891

2,340,697
57,411

7,753
45,737

28,753
40,620

204
45,302

814
324,447

897
314,620

2,523
310,991

186,525
284,659
491,439
240,317
4,171
527,330

147,216
274,478
484,345
36 1,168
4,171

186,357 '
274,435
464,874
201,652
6,175

Other securities •••••••••••••••••••••••••
Other loons for p urchasing or ca rrying:

U.S. Government securities ••••••••••••.•••
Other securities •••••••.•••••.•••••••••••
loans to nonbank flnoncial institutions:
Sales finance, personal flnonce, factors,
and other business cred it companies •• •• •••
Oth.r ..•••••..•••••••••.•• • ..• •••• •• .•
Real estate loans •• •••.••••••••.• •.•• •••• .•
Loans to dom estic commercial banks ••••.••.•.•
Loans to foreign bonks •••••••••.•••••••.•.•
Consumer instalment loons •••••.•.•••••••••••
Loans to foreign governments, offlciol
institutions, e tc ...........................
Other loons' ••••••.• , .••••..•.•.•••• • •• • ••
Total investments ••••.•...•••.•••••••••••••••
Totol U.S. Government securities ••• .••.• •••• ••
Treasury bills •.. •.•••••••• , .••• •• •••• •••
Treasury certiflcotes of indebtedness ••••••••
Treosury notes and U.S. bonds moturing:
Within 1 yeor ••••. • •••• •• • • •••••••.••
1 year to 5 years •••••••••.• ••••••• •••
After 5 years • • ••• •••• • .••••.••.••••••
Obligations of state s and political subdivisions:
Tax warrants and short·term notes and bills • •
All oth.r .. .... . ............. ......... ••
Other bonds, corporate stocks, and securities:
Participation certiflcates in Federal
agency loans' ••••• ••• •• ....••••. . ••••
All oth.r (including corporate stocks) • • ..• • ••
Cash items in process of collection .•• • .•.••• • . ••
Reserves with Federal Reserve Bonk • • •••••••.•.•
Currency ond coin . ••.• .• • .•• •••• ••••••••••• •
Balances with banks in th e Unite d States • •••• •• ••
Balances with banks in foreign countries ••• • •••.•
Other a sse ts •• • • •••• •• • • • •••••••••••.••. • •• •

522,02:}
552,514
2,322,015
1,092,406
54,629
15,117

1,118,903
44,822
7,164

116,550
644,798
257,346

115,001
641,423
266,236

130,279
575,987
360,651

131,361
63,805
850,458
612,044
77,889
436,110
4,779
322,667

132,555
63,802
687,685
561,822
71,685
439,631
3,821
328,153

781,938
496,565
69,361
442,242
4,226
317,613

9,876.147

9,656,942

9,259,063

Total d eposits ••. • ••.• •••• ••..•.••••••• •••• .

8,416,524

8,324,061

7,936,569

Total d emand d . posits .....................
Individuals, partnershi ps, and corporations ••••
States and political su bdivisions •• • • ••••••••
U.S. Government • ••••• •••••••••• ••.••.••
Banks in the United States • •. ••••• •• .••••.•
Foreign:
Governments, offlcial institutions, etc .......
Commercia l banks . •...•.• ••• • •••••••••
Certif1ed and offlcers' checks, e tc .••••..••••
Total time and savings d e posits •• , .••••••..••
Individuals, partnerships, ond corporations:
Savings d e posits ••••••.... ••••••••••••
Other time deposits ••.•..•••...•.••..••
States and political subd ivis ions ••..••••••.•
U.S. Government (including postal savings) •••
Banks in the Unit e d States ................ .
Foreign:
Governments, official institutions, etc .. ... ..
Comm e rcia l banks •.•..••.•••.•••••..• •
Bills payable, rediscounts, and other
liabilities for borrowed money •..•••••••• .• . .
Other liabiliti es ••.. ••. • •••••••••••.•••••••..
CAPITAL ACCOUNTS .. ............ ......... .

5,055,661
3,410,831
289,421
118,436
1,122,503

4,949,392
3,399,930
364,360
88,524
1,002,010

4,794,947
3,155,250
325,008
240,768
977,069

4,431
23,346
86,693
3,360,863

2,530
20,961
71,077
3,374,669

3,035
19,553
74,264
3,141,622

1,134,251
1,602,409
591,637
10,955
20,111

1,118,592
1,613,177
609,919
11,044
20,407

1,309,670
1,292,141
517,486
3,359
16,226

800
700

800
730

360,721
220,183
878,719
9,876,147

"""}

1,058,964

636,101
590,200
45,901
631,521
4,580
14
4,566

637,777
591,975
45,802
633,627
4,150
589
3,561

601,093
556,859
44,234
597,387
3,706
24,124
-20,4 18

625,930
471,500
154,430
592,958
32,972
4,054
28,918

642,942
485,475
157,467
601,499
41,443
2,368
39,075

617,702
472,047
145,655
584,064
33,638
8,664
24,974

1,262,031
1,061,700
200,331
1,224,479
37,552
4,068
33,484

1,280,719
1,077,450
203,269
1,235,126
45,593
2,957
42,636

1,218,795
1,028,906
189,889
1,181,451
37,344
32,788
4,556

---

CONDITION OF THE FEDERAL RESERVE BANK OF DALLAS
(I n thousands of dollars)

Item
Total gold cer tiflcate reserves •••••.• • •..•...
Discounts for me mb er bonks •••..• • ••• • • •.••
Other discounts and advances ••••••••.•••.•
U.S. Government sec uri ti es •••..•••.••..••..
Total earning assets •. • •••. . •• . • ••. • •••••••
Member bonk reserve de posits • . • •..••••.• ••
Federal Reserve note s in actual circulation • • • ••

375,384
4,820
1,044
1,896,031
1,901,895
994,292
1,289,462

CONDITION STATISTICS OF ALL MEMBER BANKS
Eleventh Federal Reserve District

LIA81L1TIES

lin mil lions of dollars)
May 3 1,
April 26,
May 25,
________________m
It. __________________l_9_6_7________6_7_______
19
ASSETS
Loans and discounts 1 •••••• ••• • • •• • •• ••••
U.S. Gove rnment obligations • • ••.•••. •••• •
Other securities 1••• ••• • ••••• • •• •• ••• • •• •
Reserves with Fe d e ral Reserve Bank • ••• . .••
Cosh in vault ••. ••.. .••. . .•...•..•.•.••
Balances with bonks in th e Unite d Stotes ••••
Balances with bonks in foreign countriese ....
Cosh it e ms in process of collection • • .. • ••••
Other asse tsc .• • ..••..••.•.. . ••••.....•

9,039
2,270
2,397
947
219
1,031

6

8,792
2,311
2,373
1,095
237
1,127

7

786
492

1,146
523

TOTAL ASSETS ........ ............. .

17,187

17,6 1 1

1,300
1,440

L1A81L1T1ES AND CAPITAL ACCOUNTS
D. mand deposits of banks ••..•. • ...••••.
Oth.r d.mand d.posits ....... . ....... . . .
Time deposits ••..•••.••••..•••..•.•••.•

1,246
7,561
6,345

279,858
180,389
872,634

338,699
162,054
821,741

Total d.posits ••••••.••••..•.•• . .••••
Borrowings •....••.••. . .• • •.•• •. .•.• • ..
Other liabilities e . • .•...• •• ..••••••..•••
Total capital accounts e • •. •• •••. '" .••. "

15,152
296
245
1,494

9,259,063

TOTAL L1A81L1T1ES AND CAPITAL
ACCOUNTS· ..••.••••••.•••.••••••

-

15,431
439
247
1,494

9,656,942

8,57 4
2,339
2100
'829
211
984
6
821
444

1,3 84
7,741
6,306

1 Because of format ond coverage revisions os of July 6, 1966, earlier data are not
fully comparable.
=.! Certificates of participation in Federal agency loons inc/ude Commodity Credit
Corporation certificates of interest previously included in "Agricultural loons" and
Export-I mport Bonk participations previously included in • ' Other loans. "

2

RESERVE CITY BANKS
Total reserves he ld ••••• ..••..•
With F.d.ral R.s.rv. 8ank ....
Currenc y and coin . •• . ••.• ••.
Required reserves .•..•••..•.•.
Excess reserves ..••..... .. ....
Borrowing s ....•..•...••. •••••
Free reserve s •....••....••.•••
COUNTRY 8ANKS
Totol reserves hel d •......•...•
With Fe d erol Reserve Bank .. ..
Curre ncy
col" ..• • •.•••..
Re quired reserves ••.•••.••.. ••
Excess reserves ••••••......•••
Bo rrowing s •• . •.•••• .•••. • ••..
Free reserves •••..••••..•••••.
ALL MEMBER BANKS
Total re serves he ld .••.•...••..
With Federal Reserve Bank ... .
Currency and coin .••.. • ••..•
Re quired rese rve s • .••..•••• • •.
Excess reserves ••.•..•.•.....•
Borrowin gs ••. . . . •. .• •.• ...•..
Free reserves •••...•....••..••

2,177,867

1,076,207
42,346
15,167

1,017,213

TOTAL L1A8ILITIES AND CAPITAL ACCOUNTS

4 w•• ks ended
Jun. I,

1,1 '6 7,089

0
579,799
2,317,258

16,046
1,029,839

TOTAL ASSETS . ....... . ... ....... .... . .

4 weeks e nd e d
May 3, 1967

1966 1

ASSETS

loans to brokers and d eal ers for
purchasing or carrying:
U.S. Government securities ••••..••••••••.•

5 weeks . nd. d
Jun. 7, 1967

Ite m

17,611

n - :u n l :5 - -=:9-= 6-g- J - -e-:- , 1 6-= ,
-C -r- o ra-ti-o-n- ce ti- ca t-. - -o i-nte rest
-o p - - -r- fl- - s -fExport-Import Bonk participations are include d in "Other securities" rather
"Loons and di scounts. "
,
e - Estimated.

BANK DEBITS, END-OF-MONTH DEPOSITS, AND DEPOSIT TURNOVER
(Dollar amounts in thousands, seasonal ly adiusted)

=-

DEBITS TO DEMAND DEPOSIT ACCOUNTS'

DEMAND DEPOSITS '

Percent change

May
1967
ba sis)

Wichita Falls ••.. . •..•••.• • ••.. .••• ••• . •• •.• •

4,280,760
1,971,024
6,015,540
634,632
1,855,044
4,469,520
4,574,064
5,516,892
1,357,824
4,006,728
406,896
66,93 1,308
5,217,696
14,983,740
2,104, 128
64,464,168
653,928
3,753,936
1,380,792
1,635,600
1,186,980
867,840
11,924,472
1,279,272
1,570,644
2,047,764
1,949,064

-4
-1
-2
-2
11
-12
9
3
7
14
-9
-3
0
2
-5
9
7
8
7
-4
-5
0
3
-5
-6
-3

27 centers . .. ....•..•.....•.... . .. • ··•·· · ··· ·

$217,040,256

-4

ARIZONA: Tucson •••..••.. • ••.. • .•.•. • .••.••••.•••••
LOUISIANA: Monroe . •••.. ••• •••. ... . ...••..•...•.••
Shreveport ••.•. . ••.•..••..••••..••..•• • •
NEW MEXICO: Roswell ' ••..••..•••..•••••••...•••.••
TEXAS: Abilene . •• •..•••...•..•••...••..• , •...••••.•
Amarillo ... . .. .. ........... •........ .... .. · .
Austin .. .......... ... . .... . ........•....... .
Beaumont-Port Arthur-Orang e . ....•.....•.. . •..
Brownsvill e- Harlingen-San Benito . ..... . .... . ....
Corpu s Chri sti • •• .... •.... . ............• . . .. ..
Corsicana 2 •• ••••••••••••••••••••••••••••••••

Dallas • . • . . •••.• • •••••••••.. •••••.. ...•••.••
EI Paso • ... • •.••••.. • •.. ••••.•••. .•• . .••.••.
Fort Warth ••••..••.. • •...•••••••.• . •• •..•• · ·
Galveston -Tex a s City .. .. . . . ...... .•......•.. .
Houston . ...........•.......................
laredo .. ... . . ........ .. . .. .. . . ... .....• . ..•

LUbbock • .•••.•••...••..•••..••.•••...••.. . •
McAli en-Pharr-Edinburg •••• .. • •••..••• ..•••••••
Midland . . • . •••••••••...••••••.••.•• • ••• ·•· •
Odessa .•.•.. . ......• .•... . . ... . .•........ · .

::::::::::::::::::::::::::::::::
Texarkana (Texa s- Arkansa s) . • • . ... .... • .. ... ...

Tyler •••...••••••....• , •....•...... . ..• • •...

-

TO ol _
l

Waco • •..•. •.. ..... . ........ .......... .. ·· .

$

5 months,
19671ram
1966

May
1967

April
1967

May
1966

$ 164,003
76,709
219,589
34,609
97,161
139,115
208,458
215,787
61,006
190,202
28,311
1,734,833
198,201
494,785
92,722
2,012,335
32,065
140,599
74,810
122,355
63,139
55,869
517,879
59,699
82,893
111,719
109,604

26.0
26.2
26.5
18.7
19.3
32.2
23.3
25.4
22.6
21.8
14.2
38 .9
26.3
30.3
23.3
32.2
21.1
26.9
18.6
13.5
18.6
15.7
23.2
22.3
19.3
18.8
17.8

25.2
28.2
26.8
19.4
19.9
28.5
27.9
23.3
22 .3
21.1
12.4
43.2
26.7
30.0
23.3
34.7
18.9
25.5
17.6
12.8
19.2
16.5
23.4
22 .0
20.6
20.0
18.3

23 .6
26.7
25.6
18.5
19.6
31.6
22.3
25.1
22 .3
21.4
12.6
38.4
24.3
29.8
21.2
30.5
18.7
24.7
15.8
13.7
19.2
16.2
23.8
19.8
19.0
19.1
19.0

10

12
4
14
3
0
2
10
7
8
7
15
7
9
3
10
9
20
4
20
4
-3
-3
-1
21
-1
3
-9

May 31,
1967

6
8
11
9
7
8
10
12
-4
13
-1
-4
1
2
20
1
3
-8

May
1966

April
1967

(Annual -rate

Standard metropolitan
statistical area

Annual rate
of turnover

Ma y 1967 Iram

$7,338,457

29.8

31.4

28.8

9
4
13
-1
2
-2
12
7
-

7

I

Deposits of individuals, partnerships, and corporations and of states and political subdivi sion s.

County basis.
NOTE . _ Figures for 1966 have been revised due to the use of new seasonal adiustment factors.

GROSS DEMAND AND TIME DEPOSITS OF MEMBER BANKS
Eleventh Federal Reserve District
(Averagos 01 dal ly flgures. In millions 01 dollars)
GROSS DEMAND DEPOSITS

BUI LD ING PERMITS
Date
VALUATION (Dollar amounts in thousands)
Percent change

from

Moy
1967

May
1967

5 mos.
1967

575

2,710

80
419

367
1,665

1,223
2,129

16 0
47
409
167
66
399
2,166
562
66 1
105
2,460
33
141
122
126
107
85
1,377

268
724
1,909
720
309
1,823
9,626
2,385
3,102
496
10,299
168
669
420
5 10
399
365
5,953
206
1,255
356

1,793
1,291
13,398
1,114
154
2,020
15,148
5,114
4,625
2,094
27,9 15
307
2,329
1,757
675
319
678
9,655
288
2,789
3,034

1965: May •.•• ••
1966: May .•••••

8,484
8,669
9,098
9,352
8,902
8,95 1
9,140
8,833

4,055
4,019
4,202
4,226
4,020
4,106
4,245
4,089

Dece mb er . .

May 1967
NUMBER

Total

Reserve
city banks

1967: January •• •
February .. .
March •... .

5 months,
1967 Iram
1966

April
1967

May
1966

9,862

49

98

-64
52

-37
-36
- 14
-42
76
-58
59
-44

4,429
4,650
4,896
5,126
4,882
4,845
4,895
4,744

5,091
5,795
5,781
5,934
6,091
6,183
6,231
6,261

Reserve
city banks

2,455
2,743
2,575
2,645
2,721
2,738
2,723
2,716

Country
banks

2,636
3,052
3,206
3,289
3,370
3,445
3,508
3,545

34
-1 1

7 15
7,032
10,354 -73
56
61,267
o
6,279
944 - 18
11,878 -28
12
76,299
25,600 - 18
30,229 -24
348
4,018
24
141,712
1,784 -18
14277 -65
108
5,001
18
2,817
1,987 -26
65
2,663
46,250
67
107
1,719
428
5,888
117
6,546

Total

23

10,29 1
9,409

TIME DEPOSITS

Country
bonks

5 mos.
1967

April ••••••
May ..••••

ARIZONA
Tucsoll

$

2,011

$

Monroe_ West

Sh Monroe. • • • •
TEX
;;veport. • . •
Abilene

•• . • • •
AUIII
" " ••
8eo n ••• " . "
8 umont.....
rown lvi ll e
Corpus Ch:': '
Dalla s

mh . •

EI P ••••••.•
Fort
••
Houll
•••• •
Laredan ••.• "
Lubb o .. ' " . •
....•
Odessa·· · · .•
Par,
••. .
San A r... .
Son
••
T.'a k

°:';;" . " . .

"0...

alla. ' "

T
Olol

:

48

_ __
•• 10,742

46,704

$10 1,860

$494,106

13

-8

4

- 1

442
-28
124
-58
3
-28
-41
-59
77
-2 1
369
469

-5

VALUE OF CONSTRUCTION CONTRACTS

-8

-25
72
- 13
-44
-25
-14
-I
36
24

-8
79
-49
-50
-55
-29
- 33
2
- 61
12

(In millions of dolla rs)

Area and type
FIVE SOUTHWESTERN
STATES' • .••••.•••••.•••
Res idential building • ..... .
Nonresi d ential buildillg . . ..
NonbuHdlng construction . •.

UNITED STATES ••.. ••• •.•••
Resid ential building . ..... .

Nonresidential building ..• •
Nonbuildlng con struction . ..

January-May

May
1967

April
1967

March

1967

1967

1966

519
208
138
171
5,095
2,002
1,808
1,285

522
171
248
103
4,389
1,627
1,830
931

463
173
174
116
4,424
1,584
1,7 14
1,127

2,240
793
845
616
19,929
7,182
7,884
4,863

2, 180
918
675
586
21,871r
8,736r
7,965
5,171

-6

1

-4

NOTE . - Details may not add to tota ls because of rounding.
SOURCE: F. W. Dodge Company.

Arizona , loui siana, N ew Mexico, Oklahoma , and Texa s.
Revised .

r-

3

WINTER WHEAT

DAILY AVERAGE PRODUCTION OF CRUDE OIL
(In thousonds of barre ls)

ACREAGE
(In thousands of acres)
Perce nt change from

For
harvest

PRODUCTION
(In thousands of bushels)

Harvested

May
1967 p

Area

Area

Crop of
1967

Crop of
1966

Crops of
196 1-65

Crop of
1967 1

Crops of
1961-65

Crop of
1966

ELEVENTH DISTRICT. •••••.•
Texas ......•. ..........

Arizona ........
louisiana .. . ....
New Mexico .... .
Oklahoma ••••••
Texas ... .. .....

50
100
148
4,935
3,132

23
55
147
4,700
3,229

27
50
207
4, 180
3,119

2,300
2,700
3,552
88,830
56,376

920
1,540
4,704
98,700
72,652

1,21 4
1,1 72
4,752
97,372
63,065

East Texas (proper) •••••
Panhandle ••••.••.•.••
Rest of State ••......••

Total •••.•••.•

8,365

8,154

7,583

153,758

178,516

167,575

Southeastern New Mexico ..
Northern loui sia na • . • .....

Gulf Coast •.•• • •••••••
West Texas •..........

OUTSIDE ELEVENTH DISTRICT
UNITED STATES •• ••.•••••..

• Ind icated June 1.
SOURCE, U.S. Department of Agriculture.

p -

April
1967p

May
1966

3,460.0
2,982.4
561.6
1,354.3
125.4
95.4
845.8
308.9
168.7
5,076.0
8,536.0

3,497.9
3,006.2
563.0
1,370.9
128.1
95.7
848.5
320.5
171.2
5,099.9
8,597.8

-----------------May
April

3,432.3
2,979.3
559.7
1,393.2
128.4
96.9
801.1
307.9
145.1
4,947.7
8,380.0

-

1967

1966

-1.1
-.8
- .3
-1.2
-2.1
-.3
-.3
-3.6
-1.5
-.5
-.7

0.8
.1
.3
_2.8
_2.3
_1.6
5.6
.3
16.3
2.6
1.9

Pre liminary.

SOURCES, American Petroleum Institute .
U.S. Bureau of Mines .
Federal Reserve Bank of Dallas.

--

NONAGRICULTURAL EMPLOYMENT
INDUSTRIAL PRODUCTION

Five Southwestern States'

(Seasonally odiusted indexes, 1957·59

= 100)

Percent change

Ma y 1967 from

Number of persons

Type of em ployment
Total nonagricultural
wage and salary workers ••

Manufacturing ...........
Nonmanufacturing ........

Mining .... ...........
Construction ...........
Transportation and
public utilities •••.....

Trade •. •••• .• ••• •••••
Finance ••• •.•• .••.• •• •

Service ..... ........ ..
Governm ent • •• ...• ••. •
1

May
1967p

April
1967

May
1966r

April
1967

May
1966

5,647,300
1,023,200
4,624,100
231,200
375,300

5,627,400
1,020,800
4,606,600
231,200
371,700

5,397,400
983,000
4,414,400
231,700
364,600

0.4
.2
.4
.0
1.0

4.6
4.1
5.0
-.2
3.0

433,100
1,311,900
277,800
841,800
1,153,000

430,400
1,305,600
277,500
838,500
1,151,700

413,500
1,256,700
265,300
790,800
1,091,800

.6
.5
•1
.4
.1

4.7
4.4
4.7
6.4
5.6

Arizona, Louisiana , New Mexico, Oklahoma, and Texas.
Preliminary.

p r -

Revis ed.

SOURCE, Stata employment agencies.

4

Area and typo of index

May
1967p

April
1967

March
1967r

May

154.2
171.7
189.2
160.1
118.2
211.7

151.3
170.4
188.4
158.4
112.6
209.9

153.0
169.8
19Q.6
156.0
118.8
206.2

145.8
161.9
176. 6
152.1
115.5
183.3

155.5
157.4
162.5
150.9
120.9
179.5

156.0
157.8
162.5
152.0
122.1
179.5

156.4
158.1
162.9
152.1
122.5
18Q.6

155.3
157.6
164.2
149. 4
120.7
170.2

TEXAS
Total industrial production • . •.....
Manufacturing ......•.••.... •

Durable ••••.•••.••• • • •••• •
Nonduroble •••••••• ••• ..•••
Mining ••.......••..........

Utilities ••••••••••• ••• ••• .•• •
UNITED STATES
Total industrial production •••..•.•
Manufacturing •.•....••....•.

Durable ••••••• ••• •••••••. •
Nondurable ••• •• ••• ••••••••
Mining • •• . ..•.•. . ..... .. • ..
Utilities •.....••... ....•.. .• .

p -

r-

Preliminary.
Revised.

SOURCES, Board of Governors of the Federal Reserve System.
Federal Reserve Bank of Dallas.

----