Annual Report of the Federal Reserve Board, 1917

FOURTH ANNUAL REPORT OF THE FEDERAL RESERVE BOARD COVERING OPERATIONS FOR THE YEAR 1917 WASHINGTON GOVERNMENT PRINTING OFFICE 1918 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

TABLE OF CONTENTS. Page. Fart I.—Report of the Federal Reserve Board 1-34 Text of report: Letter of transmittal 1 Federal Reserve Banks as fiscal agents of the United States 2 Discount policy of the Federal Reserve Board in connection with war financing 5 War finance and banking : 8 Discount rates and war financing. 10 Effect of amendments of June 21 to the Federal Reserve Act 11 Membership of State banks and trust companies 13 Curtailment of unnecessary credit 14 Private and corporate financing I4*- Conservation of gold 20 Check clearing and collection system 23 Operation of the gold settlement fund 24 Establishment of branches of Federal Reserve Banks 24 Enforcement of section 8 of the Clayton Act 25 Supreme Court decision in case brought to test constitutionality of section Ilk of the Federal Reserve Act 26 Earnings and expenses of the Federal Reserve Banks 27 Conferences of Board with Federal Reserve agents, governors, and advisory council 28 Reserve cities designated during the year 30 Amendments suggested to the Federal Reserve Act 31 Organization, staff, and expenditures of the Federal Reserve Board 34 EXHIBITS. Exhibit A.—Discount rates, movement of, during the year 37-43 Exhibit B.—Federal Reserve notes 44-59 Exhibit C.—Statements of condition of Federal Reserve Banks__ 60-95 Exhibit D.—Investment operations of the Federal Reserve Banks 96-132 Exhibit E.—Gold settlement fund operations 133-139 Exhibit F.—Clearing operations during the year 140 Exhibit G.—Receipts and disbursements of the Federal Reserve Board 141-144 Exhibit H.—Earnings and expenses of the Federal Reserve Banks 145-157 Exhibit I.—State banks and trust companies admitted to membership hi the Federal Reserve system 158-162 Exhibit J.—Circulars and regulations of the Federal Reserve Board 163-186 Regulations governing the exportation of coin, bullion, and currency 183-186 in Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

IV CONTENTS. Part I.—Report of the Federal Reserve Board—Continued. Page. Exhibit K.—Foreign branches of national banks authorized 187 Exhibit L.—List of national banks granted fiduciary powers during the year 188-190 Exhibit M.—List of member banks granted authority to accept drafts and bills up to 100 per cent of their capital and surplus 191-193 Exhibit N.—Personnel and salaries: Salaries of officers and employees of the Federal Reserve Banks 194-196 Salaries of officers and employees of Federal Reserve Board 196-197 Salaries of national bank examiners 198-200 Exhibit O.—Directory of the Federal Reserve Board, Federal Reserve Banks, and Federal Advisory Council 201-207 Exhibit P.—Description of Federal Reserve districts 208-213 Map showing 214 CHARTS. Federal Reserve notes outstanding and in circulation, also amounts of gold and required paper held by Federal Reserve agents 49 Movement of reserves of all Federal Reserve Banks during the year 65 Movement of earning assets of all Federal Reserve banks during the year 70 Net deposit and Federal Reserve note liabilities, total reserves, and ratio of total reserves to aggregate net deposit and Federal Reserve note liabilities 71 Cash reserves and excess reserves of Federal Reserve Banks 73 Weekly transactions through the gold settlement fund 139 Map showing Federal Reserve districts 214 Part IT.—Reports of Federal Reserve Agents to Federal Reserve Board 215-607 District No. 1—Boston 217-251 District No. 2—New York 253-306 District No. 3—Philadelphia 307-358 District No. 4—Cleveland 359-388 District No. 5—Richmond 389-411 District No. 6—Atlanta 413-432 District No. 7—Chicago . 433-454 District No. 8—St. Louis 455-4S3 District No. 9—Minneapolis 4S5-505 District No. 10—Kansas City 507-533 District No. 11—Dallas 535-571 District No. 12—San Francisco 573-607 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. FEDERAL RESERVE BOARD, Washington, January 15,1918. SIR : In conformity with the requirements of section 10 of the Federal Reserve Act, the fourth annual report of the operations of the Federal Reserve Board for the calendar year ended December 31, 1917, is submitted herewith. The outstanding feature of the year has been the entry of the United States into the war. The declaration by Congress of a state of war, on April 6, had been preceded by a period of unprecedented activity and expansion in practically all lines of business and industry, tempered, however, in the minds of thoughtful men, by uncertainty and apprehension as to ultimate adjustments. The feverish conditions brought about by an unparalleled increase in business activity, changing our position from a debtor to a creditor nation, the great influx of gold into the country, and the large foreign credits negotiated here, had convinced the Board that the time had come when the Federal Reserve system should be strengthened and brought to the highest state of efficiency, in order that it might perform the most effective service in either one of two events which seemed likely to take place—the conclusion of a general peace in Europe^ or the entry of the United States itself into the war. In the event of peace, a radical readjustment was to be expected, and there would have been a slowing down of those industries which were engaged in supplying war material, a consequent heavy falling off in our exports, accompanied, in all probability, by a strong demand upon us for credit and gold. On the other hand, in the case of our own belligerency, it was foreseen that there would be a greatly increased demand for all articles necessary for the equipment and maintenance of our own military and naval establishments, and much larger demands for the sale of goods and for credit to the countries associated with us in the war, for both of which large loans would be necessary. It was foreseen, in addition, that we should anticipate a cessation of gold shipments to us by the allied powers, as well as a contraction of our export trade to neutrals. For these reasons, the Board felt that it should in either event, during this period of uncertainty, adhere strictly to its policy of 1 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

2 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. maintaining the liquid character of the assets of the Federal Reserve Banks, of discouraging any unnecessary expansion of credits, and that it should also cause the reduction to very moderate proportions of the holdings of the Federal Reserve Banks of such investments as bonds and warrants which had heretofore been made primarily for the sake of income. Early in the year, therefore, the Board began to carry out these policies and the end of March found the Federal Reserve Banks in a very strong position. Holdings of municipal warrants, which at times had been freely purchased by some of the banks, had then been reduced to a comparatively small amount. In order better to provide for the strengthening of our banking structure, for the conservation and greater concentration of our gold supply, and for the more effective control of its outflow, the Board in January suggested some amendments to the Federal Reserve Act which were designed to make membership in the system more attractive to the State banks and trust companies, to modify reserve requirements in such a way as to increase the gold holdings of the Federal Reserve Banks and to make their gold more available as a basis for an elastic note issue. These amendments finally became law on June 21 and will be discussed more fully in other parts of this report. In anticipation of these changes and of future contingencies, the Board determined upon the preparation of a much larger supply of Federal Reserve notes. During the months of January and February it placed additional orders with the Bureau of Engraving and Printing, through the Comptroller of the Currency, for more than $900,000,000 of notes, and arranged also that the stock of notes on hand should no longer be reduced through withdrawals for current needs, but that as drawn upon by the Federal Reserve Banks new orders in equal amount should be placed automatically. In order to insure immediate availability, ample supplies of notes were placed at the subtreasuries for delivery to the Federal Reserve agents as required. The precautions taken have been justified by events, as there developed a strong demand for Federal Reserve notes throughout the year. When a state of war was declared on April 6, the reserve position of the Federal Reserve Banks was strong, and gold in the Federal Reserve Banks and with Federal Reserve agents amounted to $943,552,000, the combined reserve against deposits and notes averaging 84.7 per cent. FEDERAL RESERVE BANKS AS FISCAL AGENTS OF THE UNITED STATES. The entry of the country into war resulted almost immediately in the assignment to the Federal Reserve Banks of a new and important fiscal agency function. Under authority of section 15 of the Federal Reserve Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. 3 Act the banks when required by the Secretary of the Treasury shall act as fiscal agents of the United States. The Federal Reserve Banks were charged by the Secretary of the Treasury with the duty of placing issues of short-time Treasury certificates and redeeming them at maturity. During the latter part of April the Secretary of the Treasury made public the details of the first bond issue, known as the Liberty Loan of 1917, and at the same time announced that each Federal Reserve Bank would be constituted a central agency in its district for the organization of a bond campaign, for receiving subscriptions and payments, making deliveries, and managing the necessary details. These new duties have brought the banks into more intimate contact, both with the Treasury Department and with the banks of their districts, and have also increased their operating problems. It has been necessary for them to add to their working space and to more than double their clerical staffs. They have rendered especially valuable service in the prompt flotation of the various issues of Treasury certificates of indebtedness which, running for short periods only, in anticipation of receipts from the longterm bonds, were placed with banks to a greater extent than with the investing public. The initial offering of $50,000,000 of Treasury certificates, in anticipation of income-tax receipts accruing on June 30, was made before rates for money had advanced and before plans could be perfected for the subsequent larger operations. Accordingly, at the request of the Secretary of the Treasury, the Federal Reserve Banks themselves subscribed for the entire issue, at the rate of 2 per cent per annum. This constituted their first direct service to the Government in its war financing. This issue, however, was only a beginning. It was followed by an offering of $250,000,000, at 3 per cent, on April 25, which was quickly distributed by the Federal Reserve Banks among the member and nonmember banks of their respective districts. Since then these issues have been repeated on eleven subsequent occasions, four having been made in anticipation of the first Liberty loan of $2,000,000,000, which was closed on June 15, while six were anticipatory of the second Liberty loan, subscriptions to which closed on October 27. A later issue of approximately $700,000,000, in anticipation of taxes due next June, has a longer time to run than the others and was intended primarily for the convenience of those who will have taxes to pay on account of incomes and excess profits. Subscriptions were opened during the last days of December by the Federal Reserve Banks for a new offering of the same character. While the two classes of certificates appeal to banks and investors in varying degree, they serve similar purposes. The short-time certificates offered in anticipation of Liberty loan issues have in view the important object of enabling prospective investors, banks or Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

4 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. individuals, to anticipate their payments on account of their Liberty loan subscriptions. The Government in this manner absorbs accumulated savings as they become available and has thus been enabled to dispose of nearly $6,000,000,000 of long-term bonds without creating at any time disturbance of the money market. In like manner the certificates issued in anticipation of taxes will serve the purpose of avoiding stringency conditions during the second half of June, when it is expected that over $2,000,000,000 of'internal-revenue taxes will be paid. By placing these certificates of indebtedness with taxpayers, corporations, or individuals as they become prepared to set aside the amount of their tax liability, payments to the Government are distributed over several months, and approximately $1,000,000,000 of tax payments have thus been anticipated up to this time, and it may be expected, therefore, as was the case with the Liberty loan payments, that the entire payment on account of taxes due in June will be made without affecting the money market adversely. In his annual report to Congress the Secretary of the Treasury made acknowledgment of the services rendered by the Federal Reserve Banks as fiscal agents as follows: The Federal Reserve system has been of incalculable value during this period of war financing on the most extensive scale ever undertaken by any nation in the history of the world. It would have been impossible to carry through these unprecedented financing operations under our old banking system. The effective machinery afforded by the Federal Reserve Banks has permitted the Government to execute its plans without a tremor of disturbance. Great credit is due the 12 Federal Reserve Banks for their broad grasp of the situation and their intelligent and comprehensive cooperation. The Federal Reserve Banks have from the first met with a prompt and hearty response from the member and nonmember banks in their respective districts, both in the flotation of Treasury certificates and of the Liberty bonds. The Federal Reserve Banks have cooperated with the Treasury in every possible way to avoid and relieve pressure upon the money market. Under the direction of the Treasury, and for its account, they have redeposited funds with subscribing banks and have permitted payments by credit on account of subscriptions due, passing upon and receiving for the Treasury the securities given as collateral for these deposits and deferred payments. Funds accumulating with the Federal Reserve Banks for account of the Treasury have been returned to the market with as little delay as possible, whether funds were disbursed in settlement of purchases made by the United States or deposited with banks acting as agents for foreign Governments associated with us in the war; or whether they were redeposited with subscribing banks in order to remain Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. 5 available for the usual requirements of trade and commerce. So effectively and speedily have these funds been returned to the money market in the manner above described, that the average balances maintained by the Treasury with the Federal Keserve Banks, considering the volume of business transacted, have been low, the average of balances shown in the Board's weekly statements since April 6 being $145,268,000 for the whole system. Notwithstanding the facility wTith which the transactions have been conducted, it is obvious that the shifting of several billion dollars can not be effected without creating temporary demands for funds in various places, and wherever these have arisen an adequate measure of relief has been readily afforded by the Federal ^Reserve Banks through open-market transactions or by means of rediscounts for member banks. DISCOUNT POLICY. Upon the Federal Eeserve Board has fallen the responsibility of directing the policies of the system so as to insure prompt accommodation to banks whose customers required assistance either in providing for commercial demands caused by increased business activities, or in making their payments for bonds, as well as to banks which bought bonds for their own account. It was important that there be no disturbance in the money market and that interest rates should be normal and as1 free as possible from fluctuation. The Board accordingly, before the subscriptions to the first Liberty bond issue were closed, and in anticipation of the amendments which became law on June 21, established a preferential rate of discount for notes of member banks secured by Government obligations, whether certificates or bonds. As a further means of relief, the Board authorized Federal Eeserve Banks to discount for nonmember banks, upon the indorsement of a member bank, notes secured by Government obligations, whether made by the nonmember banks themselves or by their customers, when the proceeds had been or were to be used for carrying Treasury certificates or United States bonds. These measures involved modifications in discount schedules and rates, which may be enumerated as follows: (1) The establishment of a rate of 3 per cent per annum for the discount at Federal Eeserve Banks of notes of member banks running not longer than 15 days secured by Treasury certificates of indebtedness, which certificates had been issued at rates varying from 3 to 3£ per cent per annum. (2) The establishment of a rate of discount at Federal Eeserve Banks of 3£ per cent per annum for customers' notes running up to 90 days, secured by Government obligations and indorsed by mem- Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

6 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. ber banks, when such notes had been made for the purpose of obtaining funds for the purchase of Government obligations. (3) The authorization of Federal Reserve Banks to discount for member banks, on behalf of nonmember banks, notes of nonmember banks or their customers, secured by Government obligations, for the purpose of obtaining funds with which to purchase United States bonds or notes. (4) The establishment of a one-day rate of from 2 to 4 per cent at Xew York for the purpose of restoring to the market, funds temporarily withdrawn through Government loan operations. In addition, a general assurance was given savings banks and trust companies that the Board desired in every way to cooperate with them in avoiding stringency and that the Federal Reserve Banks were prepared to extend through member banks every reasonable accommodation not inconsistent with law for the purpose of relieving any strain which might result from withdrawals of deposits for purchases of Government securities. The rediscount policy of the Board, which was intended to assist those desiring to subscribe for the first Liberty loan by assuring banking accommodation pending the payment in full of their subscriptions, was amply justified by results. As nearly as can be ascertained, scarcely more than $300,000,000 of the loan was actually subscribed by banks for their own account, and of this amount a very large part was quickly transferred to private investors who had not originally subscribed for or been allotted all the bonds they desired to obtain. The amount of rediscounts at Federal Reserve Banks of notes secured by Government obligations reached its maximum of $83,185,000 on June 22, one week after the closing of subscriptions for the loan, but these notes were paid off so rapidly that the total of such rediscounts had on August 17 fallen to $11,051,000. Reports from all sections of the country indicate that only a comparatively small percentage of the first issue of Liberty bonds is now being carried upon a long-term installment basis, and that as a rule both banks and private investors were able, within a few weeks, to pay for the securities wThich they agreed to take. EFFECT OF ADDITIONAL LOANS. The services rendered by the Federal Reserve Banks during the second Liberty loan campaign, which began on October 1 and ended on October 27, were even more marked than in the first instance. The experience which had been gained on the former occasion, the fact that more time had been afforded for efficient organization, a better understanding by the people of the merits of Government bonds as an investment, and a general awakening of a sense of patri- Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. 7 otic duty all combined to bring about the vigorous cooperation of the public generally. The arrangements previously made to accommodate the banks and their customers who desired to subscribe to Government bonds remained effective, and there were no changes in discount rates, notwithstanding the advance of one-half of 1 per cent in the rate of interest carried by the bonds themselves, until the close of November and the middle of December, when general advances of from | to 1 per cent in rates of Federal Reserve Banks were made. The fact that the second loan, as offered to the public, was 50 per cent greater than the first, while actual subscriptions received were in an even greater proportion, naturally increased very substantially the operations of the Federal Reserve Banks in discounting paper secured by Government obligations. The total of such paper discounted at the Federal Reserve Banks reached a maximum on November 30, when the aggregate amount of notes under discount secured by Government obligations was $499,265,000. On December 28 the total amount of discounts of this character had been reduced to $283,421,000, but the greater part of this reduction was due to the payment of maturing Treasury certificates, and there is as yet nothing to indicate that transfers of bonds to investors have been made to so great an extent as was the case with the first Liberty loan. Experience during the year with these operations and an analysis of the consequent changes in the banking situation demonstrate how greatly the entry of the United States into the war has increased the responsibility of the Federal Reserve system in its relations to the Treasury and to the public. Not only have new duties devolved upon the Federal Reserve system, but it has been made more directly responsible for the banking situation as a whole. The Federal Reserve Board is not responsible for the financial policy of the Government, except in so far as the Secretary of the Treasury may choose to call upon its members for service in an advisory capacity. The Board, however, is charged by law with the exercise of a general supervision over the Federal Reserve Banks, both as to their ordinary business and with respect to their functions as fiscal agents of the Government. In the latter capacity they are undertaking grave duties and responsibilities, and their activities are of such scope that any administrative mistakes or errors of judgment might entail serious consequences. This responsibility is fully appreciated by the Board, which, while it has been actuated by a desire to do all in its power to give the country every advantage accruing from the financial resources of the Federal Reserve system, has constantly realized that its primary duty is to maintain the system in the strongest possible position. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

8 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. The discount policy of the Board has accordingly been governed by these two considerations. It was necessary, in order to facilitate the operations of the Treasury, that discount rates at the Federal Reserve Banks be maintained on a basis in harmony with the low interest rates borne by the Government loans during the period from the beginning of war down to the completion of the second Liberty loan. It was fortunate that this policy could be carried out without infringing too greatly upon the resources of the Federal Reserve Banks, for it is obvious that any advance in rates paid by the Government on its obligations was necessarily gradual, moving up from 3 per cent, the rate paid on the certificates issued in May, to 3J per cent and later to 4 per cent, the rate carried by the second Liberty loan issue. A more gradual advance might have endangered the success of the financial operations of the Treasury, while a more rapid movement might have brought about a convulsion in the securities market. As the rates on Government issues advanced it became feasible for the Federal Reserve Banks to raise their rates. These rates were advanced after the banks had responded fully to all calls made upon them during the period when the first and second installments were being paid in on account of subscriptions to the second Liberty loan. It is obvious, however, that it must now be the serious concern of the Board to strengthen the reserves of the Federal Reserve Banks by having them reduce their investments before the opening of the next Liberty loan campaign. WAR-TIME BANKING. Since the beginning of the war, and more especially since the entry of this country into the war, deposits in banks have increased enormously, but it should be remembered that loans and discounts and investments have increased in an even greater degree. The country's gold holdings in three years have increased more than a billion dollars and are now larger than those of any other country, but at the same time the percentage of gold reserve against deposits has decreased. These conditions are not unusual in times of war, and to a certain extent they can not be prevented, but the banks of the country should make it their business to keep these tendencies under control and to prevent too rapid an expansion of credits as far as possible without placing in jeopardy the supreme object of our national effort—the winning of the war. We should realize that in the accomplishment of this purpose the conservation of our economic and financial strength is just as important as the augmentation of our military power, and that upon this conservation our military strength depends. There must be a conservation of credit as well as of goods, and credit, generally speaking, should not be used except where it is required for the common welfare, as in planting Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. 9 crops, the manufacture of necessary articles, the extension of transportation facilities, or in such construction work as may be essential in bringing about increased production. Limitation in ordinary lines of credit is necessary to make room for the credits required by the Government for the purchase of supplies essential for war purposes. It must be expected that the war activities of the Government will bring about a further expansion of deposits and loans in banks, and in order to keep our credit structure strong it is necessary that the banks should exert their influence and lend their energies to a more general absorption of Government loans by savings, and to limitation of private credits wTherever practicable without causing hardship. We must look to the future and prepare unceasingly for further demands which may be made upon us. The products of the fields, the forests, the mines, and the manufacturing establishments of the country are not, generally speaking, in the nature of luxuries. They can, as a rule, be classed as necessaries, and with the outlook ahead of us there seems to be no possibility of overproduction. It seems, therefore, that the banks of the country, from the standpoint of good business as well as from patriotism, should lend their funds and credits freely to those engaged in these productive enterprises, and their power to serve the country in this way will be increased by the curtailment of unnecessary credits and by the adoption by the people generally of a policy of common sense practical economy. NEED OF COOPERATION. The Federal Reserve act as amended last June provides that State banks admitted to membership may retain substantially all of their statutory and charter powers. Thus State-bank members are governed by their own State laws and remain under the supervision of their State banking departments. Their interest rates and the limitations upon their loans are determined entirely by State law. There are hundreds of good banks throughout the country not yet members, but which are eligible for membership, and it seems proper to refer here to a statement issued by the President of the United States on October 13 last in which he called attention to the fact that " the extent to which our country can withstand the financial strains for which we must be prepared will depend very largely upon the strength and staying power of the Federal Reserve banks," and in which he urged the importance of developing our banking power to the maximum degree and of providing financial machinery adequate for the very great financial requirements imposed upon our country by reason of the war. He pointed out that all banks should cooperate in strengthening the position of the Federal Reserve system, thereby strengthening the Nation's banking power, and urged upon every bank officer and director to consider the question of membership in the Federal Reserve system as a " solemn obligation." Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

10 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. Since the date of the President's statement the banking departments of nearly all of the States have expressed approval of membership in the Federal Eeserve system on the part of the banks under their supervision, and the response of the banks has been most gratifying. However, the legal requirements in a number of States prohibit or militate against the cooperation of State banks and trust companies with the Federal Eeserve system, making it impossible or impracticable for them to become members or to exchange their gold for Federal Eeserve notes. The Board would suggest to the banks in these States that efforts be made to obtain such legislative action as may be necessary to enable them to cooperate with the system. DISCOUNT RATES. The discount rates of the Federal Eeserve Banks have an important bearing upon the problems of Government financing and upon the condition of the banks of the country as a whole. Since the first adjustment of discount rates, effective shortly after the organization of the Federal Eeserve Banks, changes have been comparatively infrequent and have been discussed in previous reports. At the beginning of the year 1917 money was in abundant supply and discount rates were low. The expectation of some that the entry of the United States into the war would cause an abrupt advance in rates was not realized. While market rates have advanced substantially, the process has been gradual, and there were no changes made in the rates of Federal Eeserve Banks until the flotation of the first Liberty Loan was well under way. Then, in order to facilitate the disposal of the bonds, the Board indicated to the Federal Eeserve Banks that it would be desirable to establish preferential rates in favor of notes secured by Government obligations. In the case of such paper, as with ordinary commercial paper, a distinction was made between short maturities and those running for a longer period. Accordingly, notes of member banks running not longer than 15 days and secured by Government obligations, were in general put upon a 3 per cent basis, while 90-day paper, secured in the same way, was given a rate of 3| per cent, which rates were about one-half of 1 per cent below the rates fixed for ordinary commercial paper of the same maturities. Because of the generous cooperation of many banks throughout the country in making advances to purchasers of Government bonds at the same rate of interest as that carried by the securities, these bond purchasers have had the full advantage of the facilities afforded by Federal Eeserve Banks in the rediscount of their notes. A firmer tendency became apparent during the summer at some of the financial centers, and the 4 per cent rate borne by the second Liberty Loan Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. 11 (one-half per cent more than the first) suggested the desirability of a general advance of one-half of 1 per cent in Federal Reserve discount rates. As already stated, this advance has been made, but the differential in favor of paper secured by Government obligations is still maintained. The discount schedules have been consolidated and simplified by reducing the number of separate classifications. In connection with the revision of rates, it was deemed proper to merge with the ordinary commercial rates the special rate which was made in the summer of 1915 for paper secured by warehouse receipts for staple and readily marketable products of a nonperishable character, known as commodity paper. The continuance of this rate, which had been made originally for the purpose of assisting the orderly marketing of crops in order to avoid speculation and violent fluctuations, had become unnecessary because of the great advance in the price of agricultural products, and because of the policy of price control adopted by the Government. Changed conditions made it desirable that these products should move steadily to market, and it seemed best in the circumstances not to encourage their unneeess^ry holding by producers or middle men. Complete tables showing these changes in discount rates, are appended to this report. EFFECT OF THE AMENDMENTS OF JUNE 21. The amendments to the Federal Reserve Act which became law on June 21 last, were most opportune, as they added greatly to the ability of the Federal Reserve system to assist in meeting the financial requirements of the Government, and to exercise a controlling influence in the money market, just at a time when much larger demands were being made upon it because of war financing. The amendments are substantially those recommended by the Board in its last annual report, and have brought about greatly increased holdings of gold in the Federal Reserve Banks, and more active cooperation on the part of State banks and trust companies, many of which, attracted by the more favorable conditions of membership, have now allied themselves with the system. The process of issuing notes has been simplified by permitting their issuance- against both gold alone and gold and eligible paper as security—the gold thus acquired being permitted to be counted as a part of the required gold reserve against notes. The effective gold holdings of the Federal Reserve Banks have thus been greatly augmented and their discount power commensurately increased, while the capacity of the system to adapt its operations more closely to the changing requirements of the public has been greatly enlarged. As a result of these changes the Federal Reserve note will more speedily attain the position originally intended for it; from being an occasional emergency currency used to supplement deficiencies in 34365°—18 2 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

12 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. the suppty of other existing forms of currency, it is becoming the most important constituent of our circulating medium responding promptly and naturally to currency requirements from whatever source proceeding, thus promising to give to our whole currency a kind and degree of elasticity it has never before possessed. When issued against gold the Federal Reserve note virtually functions as a gold certificate, taking the place in the circulating medium of the amount of gold for which it was exchanged. When issued against commercial paper it has more of the character of bank credit currency. In times when trade is active and the country needs increased currency the Federal Reserve note will be issued in increasing degree against commercial paper as collateral. In times of slackening demand for currency, commercial paper will be withdrawn and gold deposited in its place to provide for the redemption of notes which have been issued to the member banks. While giving greater flexibility to the Federal Reserve note, the recent amendments have not changed its security, for, as provided in the original act, the Federal Reserve note remains covered by an equivalent value in gold, or gold plus commercial paper held in trust for the public by the Federal Reserve agent as the representative of the Government. Amendments to the act have also changed the former reserve requirements for member banks by fixing them at 13 per cent, 10 per cent, and 7 per cent for central reserve city, reserve city, and country banks, respectively, and have, at the same time, strengthened the position of the Federal Reserve Banks themselves by requiring the maintenance with them of the member banks' entire reserves in collected funds, the amount and character of vault cash to be carried by a member bank being left to its discretion, as determined by actual needs. This change, together with the complete transfer of reserves prior to the expiration of the time limit set by the original act, involved the transfer of a large amount of actual money to the Federal Reserve Banks. The termination of the period when funds deposited with banks in reserve cities might be counted as reserve for country banks would not, for reasons explained in the Board's last annual report, have made necessary any material transfer in cash, but the new reserve requirements led to the shifting of about $250,000,000 and a corresponding increase in the cash holdings of Federal Reserve Banks. Another amendment included in the act of June 21 permits nonmember banks to open, for exchange or collection purposes, accounts with Federal Reserve Banks, thereby availing themselves of the facilities of the check clearing and collection system. This change, at the outset, increased still further the cash holdings of the Federal Reserve Banks, as several large nonmember institutions opened accounts of this kind with Federal Reserve Banks. Most of these Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. 13 institutions have since become members of the system, so that the balances now carried by nonmember banks are relatively small, amounting on December 31 to $16,480,000. The gain in actual cash by Federal Reserve Banks, following the amendments, may be best demonstrated by a comparison of their condition on June 1 (three weeks before the amendments were adopted), with their condition on August 3. On the earlier date the gold and lawful money held by Federal Reserve Banks and by Federal Reserve agents amounted to $933,427,000, while on the latter date the total was $1,421,382,000, and for the same period the free gold—that is, the surplus over required reserves—increased $300,000,000. MEMBERSHIP OF STATE BANKS. Second only in importance to the change in the reserve and note issue provisions of the law must be reckoned the amendment to section 9, under which State banks and trust companies may become members of the Federal Reserve system and retain at the same time their full charter and statutory privileges. The law as originally enacted gave the Federal Reserve Board discretionary powers as to the conditions under which State banks and trust companies might become members of the Federal Reserve system. In formulating regulations for the admission of State institutions the Board had to choose between two policies. It could stipulate that State banks in becoming members should conform to the requirements made upon national banks, or else it could admit them upon conditions which would leave them undisturbed in the free exercise of their charter rights and privileges as far as might be consistent with conservative banking. The Board chose to adopt a liberal policy in dealing with the State banks and trust companies, while committing itself to the principle that greater powers should be given national banks in order that there might be, as far as practicable, a basis of equality between all member banks. The Board accordingly issued regulations which were liberal in their terms, both as to the admission of State banks as members and as to their rights to withdraw at their discretion. But there had always been a question in the minds of many as to the permanence of these regulations in the absence of definite statutory guaranties. The action of Congress in confirming what the Board had attempted to accomplish by regulation has given State banking institutions firm assurance that they may continue to carry on their lawful banking business in substantially the same way as they have heretofore done, without fear of future changes in methods prescribed, and it has given them in addition the definite right to withdraw from the system upon six months' notice, subject to conditions which they regard as reasonable. The inducement to the State banks to become members of the system thus held out by the amendment to section 9 of the act was Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

14 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. further strengthened by an opinion of the Attorney General of the United States rendered on September 10, in which he expressed the view that this amendment, in reserving to the State banks as members their full statutory and charter powers, released them from the restrictions of section 8 of the Clayton Act, as to interlocking directors, to which they had been previously held to be subject, in common with the national banks. Just at a time when the principal obstacles which had previously stood in the way of the enlargement of the system by State bank membership were thus overcome by statute and by authoritative legal interpretation, an additional incentive was given the State banks and trust companies to apply for membership in the system by reason of the rapid development of the Government's requirements in war financing, the patriotic desire to assist in meeting and supplying these needs, and an appreciation of the added safety to themselves resulting from membership. Compelling reasons for membership in the system from a patriotic standpoint were brought to the attention of all the banks in a strong statement by the President on October 13, to which reference has already been made. Under all these influences many of the strongest State banks and trust companies in the United States have filed their applications and have been admitted to membership. At the time of the passage of the amendatory act 53 State banks and trust companies were members of the system, but on December 31 membership had been increased to 250. The aggregate capital and surplus of the member State banks and trust companies was on that date $525,205,530 and aggregate resources of about $5,000,000,000, as compared with $78,491,165, and $825,000,000 on June 21. It is estimated that the membership of the Federal Reserve system represents at this time about 75 per cent of the total commercial banking assets of the country. Thus it is evident that substantial progress has been made toward the complete unification of our banking system. A table showing the titles, dates of admission, capital and surplus, and aggregate resources of State bank members appears in the appendix. CREDIT EXPANSION. Great as is the admitted power of the Federal Reserve system, equipped with its new resources and supported by the greater part of the banking reserve of the country, there are, nevertheless, limits to its capacity. During the past year there have been, very naturally, some expressions of anxiety on the part of the financial community as to expansion of credits. The Board has fully recognized the dangers of overexpansion and has endeavored in every way not hurtful to war financing to prevent such a condition. The question as to how far expansion may drift toward the danger point, despite concentration and careful use of our banking resources, should be Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

ANNUAL BEPORT OF THE FEDERAL RESERVE BOARD. 15 carefully considered in the development of a sound policy for the future. The following tabulation of combined statements of the 12 Federal Reserve Banks shows the changes in the reserve position of the Federal Eeserve system during the year, the figures being as of December 30, 1916, March 30, June 29, August 3, November 2, and December 28, 1917, the four dates last named reflecting the changes directly attributable to the flotation of the Liberty loans: Combined resources and liabilities of the Federal Reserve system. [000 omitted.] Dec. 30, Mar. 30, June 29, Aug. 3, Nov. 2, Dec. 28, 1916. 1917. 1917. 1917. 1917. 1917. A.—KESOURCES. Gold coin and certificates in vault.. $283,091 $374,903 $484,264 $399,785 $501,311 $499,917 Settlement fund 170,470 200,061 345,845 438,153 378,514 317,520 Gold with foreign agencies 52,362 52,500 52,500 52,500 Total gold held by banks 453,561 574,964 882,471 890,438 932,325 869,937 Gold with Federal Reserve agents 282.522 360,668 402,693 467,845 602,433 781,851 Gold-redemption fund 1,703 2,414 9,402 9,390 11,317 19,345 Total gold reserves 737,786 938,046 1,294,566 1,367,673 1,546,075 1,671,133 Legal tender notes, silver, etc. 19,325 9,282 39,840 53,709 50,744 49,635 Total reserves. 757,111 947,328 1,334,406 1,421,382 1,596,819 1,720,768 Bills discounted—members and Federal Reserve banks 28,552 20,106 197,242 130,948 503,965 680,706 Bills bought in open market 128,956 84,473 202,270 174,183 186,012 275,366 Total bills on hand 157,508 104,579 399,512 305,131 689,977 956,072 United States Government long-time securities 44,247 29,275 36,426 42,422 53,851 48,350 United States Government short-time securities 11,167 18,425 34,302 25,464 45,211 58,883 Municipal warrants 8,974 15,715 2,446 1,249 1,267 1,005 Loans on gold coin and bullion. 21,850 Total earning assets. 221, g 167,994 494,536 374,266 790,306 1,064,310 Due from other Federal Reserve Banks, net. 44,543 2,275 1,448 4,746 14,383 11,976 Uncollected items 132,759 221,705 197,058 317,901 301,067 Total deductions from gross deposits. 44,543 135,034 223,153 201,804 332,284 313,043 Redemption fund against Federal Reserve bank notes 400 400 500 500 537 537 Other resources 6,544 5,393 799 492 1,588 2,813 Total resources. 1,030,494 1,256,149 2,053,394 1,998,444 2,721,534 3,101,471• B.—LIABILITIES. Capital paid in 55,694 56,075 57,176 57,881 64,291 70,442 Government deposits 27,662 20,567 300,966 56,765 175,912 108,213 Due to members—reserve account 720,411 1,033,460 1,192,887 1,372,023 1,453,166 Member bank deposits, net 671,793 Collection items 100,961 149,527 132,053 191,811 191,689 All other deposits, including foreign government credits 1,000 14,269 25,310 17,965 Total gross deposits. 9,455 841,939 1,484,953 1,395,974 1,765,056 1,771,037 Net deposits 654,912 706,905 1,261,800 1,194,170 1,432,772 1,457,994 Federal Reserve notes in actual circulation. 274,796 357,610 508,807 540,785 881,001 1,246,488 Federal Reserve Bank notes in circulation, net liability 934 2,828 8,000 8,000 All other liabilities 549 525 1,524 976 3,186 5,504 Total liabilities 1,030,494 1,256,149 2,053,394 1,998,444 2,721,534 3,101,471 Ratio of gold reserves to net deposit and Federal Reserve note liabilities combined 79.4 73.2 78.9 61.8 Ratio of total reserves to net deposit and Federal Reserve note liabilities combined 81.4 75.4 81.9 63.6 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

16 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. From the foregoing it will be noted that the increase in the total invested funds grouped as bills discounted and bought, during the months intervening between the beginning and the close of the year 1917, is about $798,564,000. Of this sum, $515,143,000 is represented by purchase or discount of commercial paper, the remaining $283,- 421,000 representing the discount by the banks of paper secured by Government obligations, for the purpose of enabling buyers of bonds and certificates to carry them during the period necessary for the liquidation of their own obligations thus incurred. The reduction in the reserve percentages of the Federal Reserve Banks against notes and deposits was most marked during the periods between March 30 and June 29 and between August 3 and November 2. During the month of July* there was a notable strengthening of the reserve position, but a similar recovery subsequent to the closing of the second Liberty loan had not taken place up to December 31. Taking the year as a whole, it will be noted that, although there has been a great increase in the total assets of the system, there has been a reduction of gold and lawful money reserves from 81.4 per cent at the beginning, to 63.6 per cent at the end of the year, but it should not be overlooked that the figures for December 28, 1917, represent the condition existing at a time when the process of distributing the second Liberty loan was still uncompleted. The question whether the final absorption by the ultimate investor of the second Liberty loan and the resulting financial adjustments would bring about as favorable a situation as that which existed at the closing of the first loan, is still an open one, but indications are that there will be a larger amount of bonds left in the hands of the banks and that a correspondingly greater volume of discounts secured by Government obligations may remain with the Federal Reserve Banks than was the case at the close of the first Liberty loan. The existing condition is susceptible of improvement and will be improved as the public performs its duty of absorbing the Government loans out of savings. The position of the banks with respect to credit expansion is indicated by the condensed statement of the deposits, loans, discounts, and investments of the national banks as reported to the Comptroller of the Currency on November 20, 1917, as compared with corresponding figures on December 31, 1914; November 10, 1915, and November 17, 1916. [In thousands of dollars;300 omitted.] Dec. 31,1914. Nov. 10,1915. Nov.17,1916. Nov. 20,1917. Deposits, net, on which reserve is computed. 6,668,325 8,256,662 9,976,980 10,348,800 Loans and discounts, including overdrafts. 6,363,435 7,241,140 8,355,101 9,550,571 United States bonds. . 791,995 777,765 7?4,473 22,354 183 Other stocks, bonds, and securities * 1,313,787 1,343,822 1,747,794 1,949,619 1 Exclusive of Federal Reserve Bank stock. 2 Includes United States certificates of indebtedness and payments on account of subscriptions for Liberty loan bonds. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

ANNUAL KEPOBT OF THE FEDERAL RESERVE BOARD. 17 It is proper to point out that while, during the year 1917, there has been a lessening of the fluidity and immediate availability of the country's banking resources, the change is not surprising when there is considered the extent of the requirements which have been made upon our banking system. It is evident also, from an analysis of the figures, that the decrease in reserve strength is attributable only in a minor degree to normal commercial discounts and that it is mainly the result of Government financing and the consequent demands upon our resources. What effect the credit expansion which has taken place in the United States during the past year and the years preceding—since the beginning of the European war—may have exerted on prices should not pass unnoted. Wholesale prices are estimated by the Bureau of Labor Statistics to have advanced during the year 1917 by about 24 per cent, which may be compared with an estimated advance of 47 per cent from July, 1914, to December 31, 1916. Eetail prices of principal articles of food are shown by the same office to have risen 23 per cent between July 15, 1914, and December 15, 1916, and 24 per cent between the latter date and December 15, 1917. The fact that there has been a rise of the general price level is incontestable. Indeed, it has recently become the subject of general observation and comment. There is, however, difference of opinion as to the precise degree of influence to be attributed to the several factors which have produced the result. The entire world is passing through a period of prof ound economic disturbance. In many of the richest producing countries a large part of the able-bodied population has been withdrawn from productive employment for service in the Army. Industry has suffered much dislocation and disorganization. Overseas trade has been suspended or interrupted. There has been much destruction of industrial capital and an enormous consumption of products by the armies. Inevitably, such a condition, involving either an absolute or relative shortage of many primary materials and necessaries, must have advanced values and prices to a very appreciable extent, even had there been no considerable change in the volume of credit and currency 0 In thus stating the influence upon prices of unprecedented industrial conditions the Board would not, however, convey the impression that it does not appreciate to its full importance the effect on recent price movements of the rapid and abnormal growth of the volume of credit created by all the warring nations. Indeed, so alive is the Board to the dangers that attend this phenomenon that it regards it as one of its most important duties to prevent, as far as practicable, expansion of banking credit from running an uncontrolled course. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

18 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. Banking expansion, it may be admitted, is an unavoidable incident of war finance, but every effort should nevertheless be made to counteract it as far as possible by limiting banking credit not clearly needed for the purpose of producing or carrying goods necessary for the life of a Nation at war. Goods and credit must be saved to the utmost of our ability in order to check the upward movement of prices and in order to free for the use of the Government the goods and savings required for the winning of the war. To encourage and to foster necessary business and to discourage and curtail unnecessary business must be our national endeavor, and will require the intelligent and zealous cooperation of the banking community. The problem of exercising an effective and proper control over credit involved in the public offering of securities does not present great difficulty. An effective and proper control over individual credits no doubt offers greater, though not insurmountable, difficulties. How to accomplish these results without bringing about unnecessary hardship or acute disturbance or injustice is a matter that will receive the close study and attention of the Federal Reserve Board. PRIVATE AND CORPORATE FINANCING. A feature of the banking and financial situation which has been developing during the past year, and to which the attention of the Board has been frequently directed, is the position of firms and private corporations having short-term obligations maturing in the near future, and which have been accustomed to procure accommodations upon terms not now obtainable. The action of the President in taking control of the railroads and the plans outlined by him for maintaining their revenues and their credit have disposed for the present of a most serious financial problem, but there remains to be considered the question of meeting the requirements of many corporations heretofore accustomed to appeal to the securities market for the purpose of providing themselves with necessary capital. The effect of the Government's borrowing on a very large scale has been to withdraw from the market a large proportion of the funds normally available for other short term or long term loans. The adverse influence thus exerted upon the loan and investment market is necessarily incidental to heavy Government operations of this kind. The resulting situation is more or less disturbing to all who have been accustomed to resort to banks for loans on collateral, but it is particularly distressing to the larger borrowers who rely upon the securities market. The situation has been further complicated by the continuous return of our securities from Europe, and by a comparatively large volume of obligations of foreign Governments carried by member and nonmember banks, resulting in a dimi- Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

ANNUAL REPORT'OF THE FEDERAL RESERVE BOARD. 19 nution of their percentage of liquid assets. These conditions are reflected in the requests which the Board has for some time past been receiving from many quarters that the rediscount privilege be extended to paper of a character and form which had never been regarded as eligible. Perhaps the most urgent appeal of this kind has been that the Board permit Federal Reserve Banks to discount notes which have been placed upon the market under an agreement between the borrowers and their bankers, providing for a considerable number of successive renewals, the advances having been made to the borrowers for a definite term of years. Had the Board permitted such paper to be rediscounted, Federal Reserve Banks would in a short time have been burdened with paper which the makers did not expect to liquidate at maturity. The discount of paper based upon such an agreement for repeated renewals is not consistent with the underlying principles of the Federal Reserve Act, and the Board had no hesitation in stating that it did not regard paper subject to such agreements as a proper investment for Federal Reserve Banks. The Board's attitude does not imply any question of the legitimacy of the purpose for which the funds were desired, or of the inherent soundness of the paper itself, but rather that such transactions are not of a kind which Federal Reserve Banks ought to facilitate, as they should never overlook their obligation to preserve the genuine and liquid character of their assets. Other propositions of a somewhat similar character were submitted to the Board for consideration, and their significance is that there is pressure on the part of commercial and manufacturing enterprises to gain access to the rediscount facilities of the Federal Reserve Banks and use the system to supply funds which, properly or in normal circumstances, should be provided by the securities market. The policy of the Board, however, has invariably been to interpret and apply the law in accordance with its manifest intent and underlying principles, with the end in view always of safeguarding and maintaining the liquid character of the assets /of the Federal Reserve Banks. This duty, always present, has become imperative because of the fact that the entire reserves of the member banks, so far as based upon legal requirements, are now, by the act of June 21, 1917, carried on the books of the Federal Reserve Banks. Upon these banks and upon the Federal Reserve Board, therefore, falls the responsibility for the maintenance of a liquid condition, and upon them will justly fall censure for any unauthorized use of these reserve funds which are held under a trusteeship of the highest character. Therefore, in no circumstances, can the Board admit the eligibility of paper, by whomsoever made, which in its essential character fails to conform to sound banking principles and to the provisions Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

20 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. of the Federal Reserve Act. In making this statement of its attitude, however, the Board does not ignore or overlook the very serious problems which now confront private enterprises in providing for their financial requirements both as to new money and maturing obligations. Eeference has already been made to the position of the savings banks and investment institutions in general. Undoubtedly some effective measure, not so much of actual relief as of organization to afford relief if required, is desirable, and if made available will be of great benefit to the banking situation. The resulting problem is one which does not come within the scope of the Federal Reserve system, but it is nevertheless one to which the Board can not be indifferent, because, until some satisfactory solution is found, it will be under pressure to sanction practices and to make rulings designed to open the resources of the system to uses manifestly foreign to the intent of the act. The Board therefore respectfully suggests early consideration by Congress of the problem of corporate financing in the belief that no satisfactory solution will be found that does not involve some degree of governmental intervention. The Board is of the opinion that some plan for governmental intervention or aid can be worked out which would meet the requirements of the situation satisfactorily. CONSERVATION OF GOLD. As a result of the entry of the country into the war and of the large credits given the allied Governments there was an almost complete cessation of the movement of gold to this country which had been continuous since the early months of the year 1915. In fact, the movement had begun to slacken as early as November, 1916. Foreign Governments had found it convenient to liquidate their obligations due in other countries by purchasing remittances in our own markets, frequently against credits opened by our banks or by our Government. The aggregate trade balance has continued in favor of this country, even though balances are against it in some cases. During the second quarter of the year there developed a strong tendency to withdraw gold by those neutrals whose supplies of raw materials had been drawn upon by our own Government and by other Governments associated with us in the war, and during the months of June, July, and August, our net loss of gold amounted to about $100,000,000. The movement of gold having already been restricted in all of the belligerent countries, demands for it in settling international accounts, in adjusting exchange rates, and in strengthening reserves, were naturally made in our own markets. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. 21 As the movement began to assume larger proportions, the President, on September 7, issued a proclamation to the effect that— " except at such time or times, and under such regulations and orders, and subject to such limitations and exceptions as the President shall prescribe, until otherwise ordered by the President or by Congress, the following articles, namely: Coin, bullion, and currency shall not, on and after the 10th day of September, in the year 1917, be exported from or shipped from or- taken out of the United States or its territorial possessions * * *." By Executive order of the same date the President directed that— " 1. Any individual, firm, or corporation desiring to export from the United States or any of its territorial possessions to any foreign country named in the proclamation dated September 7, 1917, any coin, bullion, or currency, shall first file an application in triplicate with the Federal reserve bank of the district in which such individual, firm, or corporation is located, such application to state under oath and in detail the nature of the transaction, the amount involved, the parties directly and indirectly interested, and such other information as may be of assistance to the proper authorities in determining whether the exportation for which a license is desired will be compatible with the public interest. " 2. Each Federal reserve bank shall keep a record copy of each application filed with it under the provisions of this regulation and shall forward the original application and a duplicate to the Federal Reserve Board at Washington together with such information or suggestions as it may believe proper in the circumstances and shall in addition make a formal recommendation as to whether or not in its opinion the exportation should be permitted. "3. The Federal Reserve Board, subject to the approval of the Secretary of the Treasury, is hereby authorized and empowered upon receipt of such application and the recommendation of the Federal reserve bank, to make such ruling as it may deem proper in the circumstances and if in its opinion the exportation in question be compatible with the public interest, to permit said exportation to be made; otherwise to refuse it." In pursuance of this order the Federal Eeserve Board, with the approval of the Secretary of the Treasury, issued regulations governing the administrative procedure with regard to the exportation of coin, bullion, and currency,1 and now considers and passes upon all applications for such shipments. Applications for permission to ship gold to European neutral countries have, except for a few days following the date of the order, been invariably declined. A different problem, however, presented itself in the case of applications for shipments of gold to the Orient, to Canada, to Mexico, and to South American countries, which had been furnishing necessary raw materials. It was 1 See page 183. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

22 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. deemed important to continue these trade relationships, while reducing shipments of gold to a minimum. For a short time gold shipments were permitted to go to India, in order to give importers reasonable time to adjust themselves to the new conditions. Silver has been permitted to flow freely to the Orient as a means of payment for Asiatic balances. In addition, as a result of negotiations between the Treasury Department and representatives of the Indian Government, provision has been made for rupee exchange to the extent of 10,000,000 rupees, which were allotted by Federal Reserve Banks to importers according to their necessities.1 In a few cases shipments of gold are being permitted to South American countries, although it is hoped that arrangements can be concluded at an early date which will facilitate exchanges with the.se countries and obviate the necessity of making further gold shipments in any considerable volume. Applications for shipments of gold into Mexico have been granted only for Government account and in cases where such shipments have been shown to be necessary to effect the importation into the United States of necessary products. The exportations have been limited, as far as possible, and the greater part of the gold which has been shipped has been applied to the payment of Mexican export duties and to meeting the requirements of Mexican law as to the return into Mexico of the value of the full gold content and 25 per cent of silver content of ores and bullion exported from Mexico. Each application has been considered upon its own merits, the Board having given notice in its regulations dated September 21, 1917, that the granting of any specific application would not constitute a precedent. In considering applications the Board has adhered strictly to the principle laid down in the Executive order that if, in its opinion, the exportation applied for was not compatible with the public interest it should be refused, and has acted also in close cooperation with the State and Treasury Departments and the War Trade Board. Foreign exchange rates have been abnormal throughout the year, and in many of the countries which send us necessary material, American bills are at a heavy discount due partly to the restrictions placed on our export trade and partly to the adverse trade balances of countries associated with us in the war. The Board is making a close study of our trade relationships with neutral countries and has secured the services of Mr. Frederick I. Kent, of New York, as its foreign exchange adviser. 1 Later an additional credit of 10,000,000 rupees was arranged, and since Jan. 1, 1918, an exchange agreement with the Government of Argentina was entered into. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

ANNUAL BEPOBT OF THE FEDERAL RESERVE BOARD. 23 CLEARING AND COLLECTION. The volume of checks handled by the Federal Reserve Banks during the year has increased enormously, although there have been no great additions to the number of nonmember banks which remit at par to Federal Reserve Banks. Section 13 of the act was amended last June as recommended by the Board, so as to allow Federal Reserve Banks to receive accounts for collection and exchange purposes from such nonmember banks and trust companies as may agree to remit to Federal Reserve Banks at par for checks drawn upon themselves and which will, in addition, maintain balances with the Federal Reserve Bank sufficient to offset the items in transit held for their account by the Federal Reserve Bank. Comparatively few nonmember banks have, however, availed themselves of this privilege, and the Federal Reserve Banks are still unable to collect checks drawn on many nonmember banks except at heavy expense. An effort was made, in the interest of some member and nonmember banks to amend the act by providing for a standardized exchange charge not to exceed onetenth of 1 per cent, to be made by member banks against Federal Reserve Banks for checks sent for collection. It was not successful, and the act as finally amended provides that a member or nonmember bank may make " reasonable charges, to be determined and regulated by the Federal Reserve Board, but in no case to exceed 10 cents per hundred dollars or fraction thereof, based on the total of checks and drafts presented at any one time, for collection or payment of checks and drafts and remission therefor by exchange or otherwise; but no such charges shall be made against the Federal Reserve Banks." The Attorney General has been requested to give his opinion as to whether this proviso applies to nonmember banks. An affirmative opinion will make possible the establishment of an universal par clearing system, but if, on the contrary, it should be held that the proviso applies to member banks only, the further development of the collection system will necessarily be slow, and in the absence of further legislation will depend upon the voluntary action of many small banks. In order to enlarge the facilities of the clearing and collection system, and to render greater service to the banks and to their customers, the Board authorized the Federal Reserve Banks on July 1 to receive for collection for account of member banks maturing notes and bills and miscellaneous drafts, subject to a moderate collection charge. Consequently, member banks which were obliged to rely upon other banks for service of this sort can now obtain it from the Federal Reserve Banks. There has also been put into operation by all Federal Reserve Banks a system of transfer drafts, which enables any member bank to have its draft drawn upon the Federal Reserve Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

24 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. Bank of its own district paid immediately without time allowance or deduction at any other Federal Reserve Bank, adjustments between the respective Federal Eeserve Banks being made through the gold-settlement fund. In this way any member bank has, under the proper and necessary restrictions provided, the same exchange facilities it would have by carrying accounts in each of the 12 Federal Reserve cities. GOLD-SETTLEMENT FUND. The operation of this fund has been described in former reports of the Board and no extended comments upon it seem necessary at this time. Under the act as amended additional safeguards have been thrown around the fund by permitting the Treasurer of the United States to carry a special account upon his books to the credit of the Federal Reserve Board as agent for the respective Federal Reserve Banks and Federal Reserve agents. Payments are now made by checks signed by officials of the Board. The practice of issuing gold-order certificates in denominations of $10,000, representing gold deposited with the Treasurer by Federal Reserve Banks, which were held in the custody of the Federal Reserve Board pending transfers between the banks and the Treasury, is no longer necessary and has been discontinued. The operation of this fund, which is in effect a clearing house for the 12 Federal Reserve Banks, has been particularly useful during the past year by reason of the continuous transfers of very large amounts which have grown out of the sale of Government bonds and Treasury certificates and the redistribution and disbursement of the funds realized. The total volume of clearings and transfers through the gold-settlement fund during the year amounted to $26,962,946,500, as compared with $5,757,836,000 during 1916. The net balances, representing the change of ownership between the Federal Reserve Banks, of gold held in the fund were $272,033,000. Without such an arrangement actual settlements between Federal Reserve Banks would have been accompanied with great expense and loss of time, but by its aid these enormous transfers have been automatic and instantaneous and have been made without the inconvenience and expense which would have been unavoidable had physical transfers or shipments of money been necessary. BRANCHES OF FEDERAL RESERVE BANKS, Questions relating to the establishment and operation of branch banks have been simplified by the amendment to section 3 of the Federal Reserve Act. As originally enacted, this section provided that each Federal Reserve Bank " shall establish branch banks " to Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. 25 be " operated by a board of directors under rules and regulations approved by the Federal Reserve Board," and provided also that there be seven directors having the same qualifications as directors of Federal Eeserve Banks. The section as now amended provides that the Federal Eeserve Board may permit or require any Federal Eeserve Bank to establish branches within its district, and that such branches, subject to such rules and regulations as the Federal Eeserve Board may prescribe, shall be operated under the supervision of a board of directors to consist of not more than seven or less than three directors, of whom a majority of one shall be appointed by the Federal Eeserve Bank of the district and the remaining directors by the Federal Eeserve Board. During the year branches have been established at Omaha by the Federal Eeserve Bank of Kansas City, at Louisville by the Federal Eeserve Bank of St. Louis, and at Portland, Seattle, and Spokane, by the Federal Eeserve Bank of San Francisco, and are now in operation. The Board has, in addition, authorized the establishment of branches at Pittsburgh and Cincinnati by the Federal Eeserve Bank of Cleveland, at Detroit by the Federal Eeserve Bank of Chicago, at Baltimore by the Federal Eeserve Bank of Eichmond, and at Denver by the Federal Eeserve Bank of Kansas City. It is expected that all of these branches will begin business at an early date. The policy of the Board in the establishment of these new branches has been to recognize the unity and paramount responsibility of the Federal Eeserve Bank, while extending full facilities to the banks in the territory served by the branch. By avoiding duplications in bookkeeping, and by a consolidated control of accounts at the Federal Eeserve Bank, it is expected that branches can be operated at a comparatively small expense. INTERLOCKING DIRECTORATES. In its report for the year 1916 the Board gave full details of its work in the application of the provisions of section 8 of the Clayton Act and the Kern amendment thereto. Under authority of the Kern amendment 186 officers or directors of member banks applied to the Board during the year 1917 for its.permission to serve at the same time as officers or directors of not more than two other banks or trust companies, coming within the prohibitions of the Clayton Act. In one case the permission applied for was refused on the ground that the banks involved were deemed to be in substantial competition. In three cases, where the applying member-bank director desired the permission of the Federal Eeserve Board to serve as a director of two other institutions, the Board determined that substantial competition existed between the member bank and one of Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

26 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. the other institutions. As a result it gave its consent to the applying director to serve on only one of those other institutions. In the remaining 182 cases the consent applied for was granted by the Board. In its annual report for 1916 the Board noted that "in a large number of other cases the directors affected recognized that substantial competition did unquestionably exist, and so withdrew voluntarily from one or more directorates, thereby bringing themselves into compliance with the act." This was doubtless true in 1917, as in the preceding year. FIDUCIARY POWERS. On June 11, 1917, the Supreme Court of the United States handed down its decision in the case of Bank v. Fellows,1 appealed from the Supreme Court of Michigan, which was referred to in the Board's last annual report to Congress. The lower court was reversed and the court sustained the constitutionality of section 11 (k) of the Federal Reserve Act, which authorizes the Federal Reserve Board "to grant by special permit to national banks applying therefor when not in contravention of State or local law the right to act as trustee, executor, administrator, and registrar of stocks and bonds under such rules and regulations as the said Board may prescribe." The decision in this case is of far-reaching and vital importance to the Federal Reserve system, in that it not only sustains the right of Congress to vest in national banks the powers enumerated in section 11 (k), but fully recognizes the right of Congress to grant to such banks any and all powers that are necessary to enable them to meet the competition of corporations organized under State law. Prior to this decision the Federal Reserve Board had granted permits to applicant banks except in those cases where the laws of the State in which the bank was located expressly or by necessary implication prohibited such banks from exercising these powers. The language of the court, in the decision handed down on June 11, seemed to be susceptible of the interpretation that these permits might be granted in any case in which the State laws permitted competing banks to exercise such powers. In view of its importance the matter was referred to the Attorney General, who reached the conclusion that while Congress is fully empowered to authorize the Board to grant permits under such circumstances, the act as it now stands does not vest this authority in the Board. There are some States which authorize banks or trust companies created and organized under their own laws to exercise such powers but which expressly prohibit any other corporations from doing so. In order to coordinate the powers 1 First National Bank of Bay City v. Grant Fellows, attorney general, and others. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. 27 of National with State banks it is recommended that section 11 (k) be amended so as to permit the granting of these powers to national banks in any case in which competing corporations organized under State laws are permitted to exercise such powers. By direction of the Board its counsel, with the consent of the court, took part in the proceedings both in the Supreme Court of Michigan and on appeal before the Supreme Court of the United States. The Board has granted during the year 1917, 112 permits for the exercise of fiduciary powers, making a total to date of 481, EARNINGS AND EXPENSES. The rediscount demands which have been made upon the Federal Reserve Banks during the past year, and the greater employment of their funds, have been reflected in very greatly increased earnings. The combined net earnings of the 12 banks for the year were $11,202,993, or at the rate of 18.9 per cent on an average aggregate capital for the year of $59,260,000. Section 7 of the Act provides that " after all necessary expenses of a Federal Reserve Bank have been paid or provided for, the stockholders shall be entitled to receive an annual dividend of 6 per cent on the paid-in capital stock, which dividend shall be cumulative. After the aforesaid dividend claims have been fully met, all the net earnings shall be paid to the United States as a franchise tax, except that one-half of such net earnings shall be paid into a surplus fund until it shall amount to 40 per cent of the paid-in capital stock of such bank." The Board construes the foregoing as meaning that no contingent fund may be set up against future expenditures or as a reserve for unforeseen losses, but that the surplus fund, which under the law can accumulate until it reaches 40 per cent of the capital of the Federal Reserve Bank, is intended to take care of all such contingencies as ordinarily would be provided for by a profit-and-loss account. The Board has advised the banks that in computing earnings available for dividends and surplus market values of securities held should be taken into account. It has also permitted banks to charge off furniture and fixtures accounts in full, and a reasonable proportion of the cost of vaults. It has authorized the writing off of the amounts actually paid for the printing of Federal Reserve notes, whether the notes have been put in circulation by the bank or held by the Federal Reserve Agent. It has also authorized those banks which own their premises to write off 5 per cent of the total cost per annum as a depreciation allowance. The gross and net earnings of all the banks for the calendar year 1917, and the divi- 34365°—18 3 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

28 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. dends declared by them during 1917, are shown in the following table: Federal reserve bank. Gross Net Amount of Fully paid earnings. earnings. dividends. to— Boston $1,198,009 $912,294 $597,829 Dec. 31,1917 New York 4,848,291 3,718,955 1,941,641 Do. Philadelphia.. 1,015,958 753,874 622,150 June 30,1917 Cleveland 1,297,244 963,152 715,615 Do. Richmond 770,009 512,223 240,945 Dec. 31,1917 Atlanta 541,823 327,313 215,972 Do. Chicago 2,022,278 1,509,871 860,057 Do. St. Louis 736,774 502,156 284,566 Dec. 31,1916 Minneapolis 628,338 418,137 363,876 Dec. 31,1917 Kansas City... 955,950 684,499 360,236 June 30,1917 Dallas 569,430 353,475 187,744 Do. San Francisco. 854,755 547,044 394,490 Dec. 31,1916 Total. 15,838,859 11,202,993 i 6,785,121 1 Exclusive of $16,603, representing dividends paid on surrendered stock and miscellaneous adjustments in dividend account. It will be seen from the foregoing that the Federal Reserve Banks of St. Louis and San Francisco have paid their accumulated dividends up to December 31, 1916, that four others—the Federal Reserve Banks of Philadelphia, Kansas City, Cleveland, and Dallas— have paid their accumulated dividends up to June 30, 1917, and that six banks, viz, those of Boston, New York, Richmond, Atlanta, Chicago, and Minneapolis, have paid all accumulated dividends to the end of 1917. These six banks, after charging off their expenses and making the depreciation allowances, which have been previously described, have set aside surplus funds and have paid equal amounts to the Government as a franchise tax, making the total payment to the Government $1,134,234. The Board wishes to repeat the statements made in previous reports that the banks are not operated primarily for profit, but in meeting the demands which are expected to be made upon them during the coming year their earnings will undoubtedly continue to be large. It is hoped that all accumulated dividends will be paid during the year, and that the excess to be paid to the Government as a franchise tax in future will be greater than the payment which has just been made. ADMINISTRATIVE POLICIES. During the period of organization and of development which extended over the first two years of the operation of the system, the Board deemed it advantageous to obtain frequent suggestions from the officials of the Federal Reserve Banks, and to have them confer with each other in order that definite understandings might be reached and uniform methods of operation determined upon. Many of the problems which had to be worked out were entirely new, and Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. 29 because of widely different conditions in the various districts frequent consultations seemed necessary to insure a better knowledge of administrative details. Thus periodical conferences with the Federal Reserve agents and with the governors of the banks were deemed advisable in order to secure more speedily an effective organization. The banks had, however, by the end of the year 1916 become well established and, having had two years of actual experience to guide them in the future conduct of their business, frequent conferences were found to be no longer necessary. Moreover, the activities of the year have been so groat as to require the constant presence of the executive officers at their banks. There have in consequence been no meetings of the Federal Keserve agents during the year, and but two meetings of the Board with the governors of the banks. The events of the past year have done much to bring into their proper relationship as parts of a working whole the several component elements of the Federal Reserve system. Experience has demonstrated that in all vital matters of general policy calling for prompt and decisive action concentration of responsibility without division of authority is indispensable. The position of the Federal Eeserve Board, as the coordinating agency for all of the 12 banks and as the governing body of the Federal Reserve system, is now well defined and the line of distinction between the local management of each one of the 12 banks as a district bank, and the operation of all of the 12 banks as a system, has become more marked. The Board has, from time to time, advised purchases of acceptances by Federal Reserve Banks from each other, and on two occasions during the year has exercised its powers of requiring Federal Reserve Banks to make rediscounts for other Federal Reserve Banks as provided in section 11 of the act. It is the policy of the Board to maintain an approximately uniform reserve position for all of the Federal Reserve Banks and to correct wherever necessary, by means of interbank rediscounts, the inequalities which result from seasonal movements of trade, or, more particularly, from the operations of Government financing. FEDERAL ADVISORY COUNCIL. The Federal Advisory Council, composed of 12 members, chosen by and representative of the Federal Reserve Banks, has held, in conformity with the requirements of section 4 of the Act, four meetings during the year, thus giving the Board, at frequent intervals, the benefit of its views as to the trend of the money market and the proper adjustment of discount rates. Members of the council have reported also upon the general financial, agricultural, commercial, and industrial conditions in their respective districts. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

30 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. RESERVE CITIES. The Federal Reserve Act confers authority upon the Federal Reserve Board to add to the number of cities classified as reserve and central reserve cities, or to reclassify existing reserve and central reserve cities, or to terminate their designation as such. As the reserves of member banks are now carried exclusively with the Federal Reserve Banks, the designation of any city as a reserve city relates only to the percentage of reserve which must be carried by the member banks located therein. The Board has retained the old classification of central reserve and reserve cities and has also designated as reserve cities, making the banks therein subject to increased reserve requirements, the cities of Buffalo, N. Y.; Grand Rapids, Mich.; Memphis, Tenn.; Oakland, Cal.; Ogden, Utah; Peoria, 111.; Toledo, Ohio; and Tulsa, Okla. Without this classification the banks in those cities would have continued to carry the reserve prescribed for country banks—7 per cent—and the Board deemed it equitable to bring their reserves up to the requirements of other cities of their class. The three central reserve cities under the old national banking laws—New York, Chicago, and St. Louis—have been continued in that classification, and the member banks of those cities are required to carry the maximum reserve of 13 per cent. Philadelphia and Boston, although important banking centers, each having a greater population than the city of St. Louis, continue to be classified as reserve cities, and reserves of 10 per cent only are required of the banks located therein. It is difficult to make an equitable and uniform adjustment of reserves under the present law, and the Board is making a careful study of the subject, with the view of considering a recommendation to Congress at a later date of a change in the law which would provide for a differential in reserves to be carried in all towns and cities alike upon certain classes of deposits, with a minimum for time deposits, a maximum for bank deposits, and an intermediate percentage for individual or commercial deposits subject to check. This is a matter, however, which will require careful study and analysis, and the Board is not prepared at the moment to make a recommendation for a change of the law in this respect. The Board desires, however, to call attention to the situation of many banks located in outlying districts of larger cities, or in boroughs, formerly independent municipalities, which are now parts of a greater city. The business of these banks is often local, and it is suggested that Congress authorize the Board to classify banks in outlying districts of large cities as though they were located in independent municipalities. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. 31 OTHER AMENDMENTS SUGGESTED. The Board sees no occasion at this time to recommend any material changes in the act. It would suggest, however, the following for the consideration of Congress: (1) An amendment of section 4 relating to the election of directors. The law provides that the member banks shall be classified into three general groups or divisions, each group to contain as nearly as may be one-third of the aggregate number of member banks of the district and to consist as nearly as possible of banks of similar capitalization, and that each member bank shall elect by ballot a district reserve elector, and it provides also that each director shall signify his first, second, and third choice, the second and third choice votes being counted in cases where no candidate has received a majority of first-choice votes. This system, which is designed to secure a representative board of directors, is complicated and has resulted in many cases in the choice of directors by a very small minority of the banks. Most of the banks since 1914 have neglected to choose district electors, and there seems to be no reason why the directors of each bank should not be permitted to authorize the president or cashier to cast the vote of the bank. The Board has ruled that electors once chosen may continue to serve until their successors are elected, but since the first year the banks have not as a rule participated fully in these elections. In the election held in December, 1917, by the various groups in the respective districts in nearly every case less than one-half of the banks participated. In the New York district 84 votes were cast out of a total of 224 in the group; in the Richmond district, 72 out of 172; in the Atlanta district, 66 out of 140; in the Chicago district, 86 out of 360; in the St. Louis district 35 out of 162; in the Minneapolis district, 45 out of 283; in the Dallas district, 15 out of 201; in the San Francisco district, 71 out of 178; and in one instance the successful candidate was chosen by 15 votes out of a possible total of 201, and in another by 26 votes out of 162. The Board would suggest, in order to simplify elections, that this section be amended by permitting each member bank, through its president or cashier, to cast a vote for director, and that there be no requirement that the groups be as nearly equal numerically as may be, but that the grouping be left to the discretion of the Federal Reserve Board. The average capitalization of the banks differs so greatly in the various districts that it is impossible to carry out the evident intent of Congress to give the large banks, the medium-size banks, and the small banks equal representation unless the banks can be Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

32 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. grouped more strictly with reference to their capitalization than is possible under the law as it now stands. (2) An amendment of section 16, which now permits Federal Reserve notes to be issued in denominations of $5, $10, $20, $50, and $100 only, so as to permit their issue in the larger denominations of $500, $1,000, $5,000, and $10,000. It is thought that such an amendment would tend to increase the gold holdings of the Federal Reserve Banks, particularly those in the larger financial centers. The Federal Reserve Banks receive gold at the present time chiefly from two sources—by registered mail or express from National or State banks, and over the counter in cases where new currency in convenient denominations is required for pay rolls or for other purposes. All avenues for loss of gold are now under control, except direct withdrawals over the counter, and an analysis of counter transactions at some of the Federal Reserve Banks discloses the fact that from $100,000 to $1,000,000 of gold certificates are paid out every business day mainly because many member banks prefer to keep as part of their vault money notes of large denominations, which can now be furnished only in the form of gold certificates. (3) An amendment of section 22. This is a penal section, not altogether definite in its terms, and the Board is constantly receiving requests for an authoritative construction. It has, however, uniformly adhered to the position that a section of this character can be construed only by the courts, and has declined in all cases to express any opinion as to the liability which might be incurred by any bank which acted upon an incorrect interpretation. As amended on June 21 this section permits transactions relating to the discount of notes, drafts, or bills of exchange by a director with his own bank, upon the affirmative vote or written consent of at least a majority of the board of directors of the bank; but there are other transactions, such as the purchase by directors of goods or property taken by the bank for debt, which might in some circumstances be permitted by affirmative vote of not less than three-fourths of its directors. There may be times when a bank can best save itself from loss by being permitted to have a transaction of this kind with one of its own directors. (4) An amendment of section 25 to provide for the Federal incorporation of banking associations whose stock is owned by national banks which operate under the control of the Federal Reserve Banks and which are engaged solely in international and foreign banking. The present law permits any national bank to invest an amount not exceeding in the aggregate 10 per cent of its paid in capital stock and surplus in the stock of one or more banks or corporations chartered or incorporated under the laws of the United States or any State thereof, and principally engaged in international or foreign banking, or banking in a dependency or insular possession of the Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. 33 United States. This language appears to indicate an intention by Congress to permit incorporation under the laws of the United States, and several national banks have become stockholders in banks which have been organized under State laws for the purpose of carrying on a foreign banking business in accordance with the terms of this section. The arguments in favor of Federal incorporation are: (a) The time will probably come when the conflict of the dual control exercised by the Federal Keserve Board and by the banking department of a State may be a matter of embarrassment or operate to restrict the activities of the banking corporation. (&) Such a banking corporation, being essentially a national enterprise, whose stock ownership by national banks was authorized by an act of Congress, would appear to be entitled to the benefits and protection of a Federal charter, which would be of great value in competing for business in foreign countries. (5) An amendment of sections 5208 and 5209 of the Eevised Statutes. These are penal sections relating to the overcertification of checks, to embezzlement, abstraction or willful misapplication of moneys, funds, or credits of national banks by officers, directors, agents, or employees of national banks, and to false entries in books, reports, or statements of national banks with intent to injure or defraud on the part of any officer, director, agent, or employee of a national bank. It is suggested that these sections be amended so as to apply to similar acts committed by officers, directors, agents, or employees of Federal Reserve Banks. (6) An amendment of section 25 to provide-that any national bank located in a city or incorporated town of more than 100,000 inhabitants, and possessing a capital and surplus of $1,000,000 or more, may, under such rules and regulations as the Federal Reserve Board may prescribe, establish branches, not to exceed 10 in number, within the corporate limits of the city or town in which it is located, provided that no such branch shall be established in any State in which neither State banks nor trust companies may lawfully establish branches. State banks which become members of the Federal Reserve system are allowed by law to retain any branches which may already be in existence and, with the approval of the Board, to establish new branches. National banks which have taken over State banks having branches are permitted to continue the operation of these branches. There seems to be no reason for such discrimination between members of the Federal Reserve system, and with the view of placing them more nearly upon terms of equality, besides affording in many cases better service to the public, it is recommended that provision be made for the establishment of branches by national banks, under proper limitations. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

34 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. ORGANIZATION, STAFF, AND EXPENDITURES. There have been no changes in the organization of the Board during the past year. The growth of the system and the expansion of the work of the Board have required some additions to its clerical and examining force. There have been some minor changes due mainly to the fact that several of the Board's staff have engaged in military service, but the Board has thus far been able to fill their places satisfactorily. There are now 76 persons on the staff of the Board. The total cost of conducting its work during the year 1917, including printing of the Bulletin and salaries of members, was $249,302,220. Two assessments totaling $237,776.82 were levied upon the Federal Reserve Banks for the year 1917. This amounts to 0.4 per cent of their average paid-in capital for the year. The cost of operating the gold-settlement fund for the year 1917 was $3,539.79, as compared with $1,343.37 in 1916, the net cost being 0.013 cents per $1,000, as against 0.025 cents the previous year. Further details relating to the operation of the Federal Reserve Board and of the system will appear as exhibits in the appendix of this report, as will the annual reports of the Federal Reserve agents. CONCLUSION. The Federal Reserve system is to-day the ultimate resource of the business and financial community, and its position as such is unquestioned. It is the Nation's banking reserve and through its control of discount rates its influence in the money market is paramount. The Federal Reserve Board, as the governing body of the system, is charged with the responsibility of so administering it as most effectively to aid the Government in its financial operations, while at the same time assuring beyond peradventure the maintenance of sound and solvent banking conditions. Every step taken and every policy decided upon must be with the view not only of maintaining and strengthening the financial position of the country in these critical times but also of providing for the readjustments which must follow the war. The Board has a profound appreciation of the serious nature of its responsibilities, and its purpose is to exercise its powers and direct the policies of the Federal Reserve system so that, while always rendering the fullest measure of patriotic service, the system shall never fail to arouse the confidence and sense of security which it now inspires as the country's great financial bulwark. By direction of the Federal Reserve Board. W. P. G. HARDING, Governor. The SPEAKER OF THE HOUSE OF REPRESENTATIVES. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

EXHIBITS. 35 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Exhibit A.—DISCOUNT RATES. Changes in discount rates during calendar year 1917. DISCOUNTS, INCLUDING MEMBER BANKS' COLLATERAL NOTES, MATURING WITHIN 15 DAYS. Mar.— Nov.— Dec— Bank. I J n 1 a 9 e n f 1 . f 7 e 1 . c , t J 2 a 4 n . . 1 15 21 A 2 p 3 r . . M 10 a . y Ju 11 n . e 26 30 1 5 10 11 21 In J 1 a 9 e n 1 f . f 8 e 1 . c , t Boston 14 S* A 4 New York 3 1 31 31 Philadelphia 3i 3 31 4 1 4 Cleveland.. 3i 4 4 Richmond 24 4 4 Atlanta 24 Si 4 4 Chicago 3i 4 4 St. Louis 31 4 4 Minneapolis 4 4 Kansas City 4 4 Dallas 24 31 4 4 San Francisco 34 3* 4 4 1 Discounts maturing within 10 days, 31 per cent. 2 Member banks' collateral notes maturing within 15 days, 3J per cent. 3 Discounts maturing within 10 days, 3 per cent, and from 11 to 30 days, 31 per cent. PAPER, INCLUDING MEMBER BANKS' COLLATERAL NOTES, SECURED BY UNITED STATES CERTIFICATES OF INDEBTEDNESS OR LIBERTY LOAN BONDS MATURING WITHIN 15 DAYS. May— June— Dec— Bank. S 2 e 5 p . t. N 3 o 0 v . . I J n 1 a 9 e n 1 f . f 8 e 1 . c , t .7 8 10 19 22 23 25 1 11 12 3 5 21 Boston.... 3* 31 New York 1 3 31 31 Philadelphia 3 31 31 Cleveland 3 31 3* Richmond 31 31 Atlanta . 31 31 Chicago 3 3| 31 St. Louis 34- 31 Minneapolis 3 31 Kansas City 3 3i 31 Dallas 3i 31 San Francisco 31 31 1 Rate of 2 to 4 per cent on member banks' 1-day collateral notes in connection with the loan operations of the Government established May 25,1917, and raised to 3-41 per cent Dec. 7,1917. 37 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

38 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. Changes in discount rates during calendar year 1917—Continued. PAPER SECURED BY UNITED STATES CERTIFICATES OF INDEBTEDNESS OR LIBERTY LOAN BONDS MATURING WITHIN 16 TO 90 DAYS. May— June— Nov.— Dec— In Bank. Sept. effect 25. Jan. 1, 22 23 24 25 28 1 4 12 15 25 26 30 1 3 5 11 21 1918. Boston 31 4 ! 4 New York 4 4 Philadelphia.. 4 4 Cleveland 3i 4 4 i Richmond 3\ 4 4 Atlanta 3i ' 4 1 4 Chicago 1 3£ 4 4 St. Louis 3*- 4 4 Minneapolis... 3?r | ; 4 4 Kansas City.. 3\ 4 i 4 Dallas 3-| i I 4 4 San Francisco. 3} i 4 4 i PAPER MATURING WITHIN 16 TO 60 DAYS, INCLUSIVE. In No^T.—- Dec— In Bank. effect Mar. effect Jan. 1, 1 Jan. 1, 1917. 26 30 1 ; 5 10 11 12 21 1918. Boston 4 4V 5 New York 4 4} Philadelphia 4 41 41 Cleveland 14 41 41 Richmond 4 41- 41 Atlanta 4 41 Chicago 4 41 41 St. Louis 4 41 41 Minneapolis 4 41 41 Kansas City Dallas 4 I Ah 41 San Francisco 4 4-1 41 | " 1 Rate of 41 per cent for paper maturing within 31 to 60 days. PAPER MATURING WITHIN 61 TO 90 DAYS. In Jar Nov.— Dec— In Bank. J e a ff n e . c 1 t , J e a f n fe . c 1 t , 1917. 15 24 I 7 26 ! 30 5 12 | 21 1918. Boston 4 41 5 5 New York 4 41 Philadelphia 4 41 41 Cleveland 41 1 41 R ich mond 4 41 41 | Atlanta 4 4* 41 Chicago 5 5 St Lonis 4 41 41 41 5 | 5 i TTfrncQc Cltv 41 41 Dallas 4 41 ; i 41 San Francisco 41 ' 41 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. 39 Changes in discount rates during calendar year 1917—Continued. AGRICULTURAL AND LIVE-STOCK-PAPER MATURING AFTER 90 DAYS. In Dec— In Bank. J e a f n fe . c 1 t , J 2 a 4 n . . F 9 e . b. N 3 o 0 v . . J e a ff n e . c t 1, 1917. 5 11 1918. Boston 5 5 New York 5 5 Philadelphia 5 5 Cleveland 5 5 Richmond Atlanta . .. 5 5 Chicago 5 5£ St Louis 5 51 51 Minneapolis 5 5j Kansas City 5 5 Dallas 41 5 5 San Francisco . . TRADE ACCEPTANCES MATURING WITHIN 1 TO 60 DAYS. In Dec— In Bank. effect Jan. Mar. Apr. June Nov. effect Jan. 1, 5 1 16 26 30 Jan. 1, 1917. 10 11 21 1918. 1 ! 7 Boston.. 31 4 4 New York 4 4 Philadelphia 31 ' 24 4 Cleveland 1 3J 31 i : 4 4 Richmond 31 4 4 A tlanta 31 4 : 4 Chicago 31 St Louis 3 31 4 4 Minneapolis 3: Kansas City 4 4 Dallas San Francisco 3 1 Sx ; 4 . 4 i 1 Rate of 3 per cent for paper maturing within 30 days. 2 Rate of 4 per cent for paper mauring 16-60 days effective Nov. 26. TRADE ACCEPTANCES MATURING WITHIN 61 TO 90 DAYS. In Nov.— Dec— In Bank. effect Apr. June Oct. effect Jan. 1, 4 26 20 Jan. 1, 1917. 26 30 1 5 11 21 1918. Boston 3i 4 4 New York... 31 4 4 Philadelphia Sh2 4 4 Cleveland 4 4 Richmond 3a 4 4 Atlanta . 3J 4 4 Chicago 31 4 4 St Louis 31 4 4 Minneapolis 31 4 4 Kansas City 4 4 Dallas 31 4 1 4 San Francisco.. 31 4 4 Digitized for FRASER j http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

40 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. Changes in discount rates during calendar year 1917—Continued. COMMODITY PAPER MATURING WITHIN 90 DAYS. In Jan.— Apr.— Bank. effect Mar. Oct. Dec. Jan. 1, 1 20 5 1917. 15 24 4 16 Boston 4 Dec. 5 New York. Philadelphia . 3* Nov. 2 Cleveland. 4 Do. Richmond 3J Nov. 5 Atlanta 3 Si Nov. 2 Chicago St Louis 3* Nov. 7 Minneapolis 4 4i Dec. 11 Kansas City . 4 Nov. 5 Dallas . . . 3 Nov. 2 San Francisco . (3) Do. 1 Rates for commodity paper merged with those for commercial paper of corresponding maturities on dates specified. 2 Commodity paper rates for bills maturing within 30 days, 3J per cent; 31 to 60 days, 4 per cent; 61 to 90 days, 4fc per cent; 91 days to 6 months, 5 per cent. 3 Rate of 3J per cent for paper maturing within 60 days and 4 per cent for paper maturing after 60 days 1 t within 90 days. NOTE.—Rates for acceptances purchased in open market, which ranged from 2 to 4 per cent for all deral Reserve Banks on January 1, had risen to 3 to 4J per cent by the end of the year at all Federal jserve Banks except Boston, Chicago, and Minneapolis, whose rates ranged from 3 to 5 per cent. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Discount rates (high and low) in force during the period from Nov. 16, 1914, to Dec. 31, 1917. MATURITIES. Within 10 days. High. Boston: Nov. 16,1914, to Dec. 31, 1915 6 Jan. 1,1916, to Dec. 31,1916 34 Jan. 1,1917, to Dec. 31,1917 New York: Nov. 16,1914, to Dec. 31,1915 54 Jan. 1,1916, to Dec. 31,1916 3 Jan. 1,1917, to Dec. 31,1917 Philadelphia: Nov. 16,1914, to Dec 31 1915 54- Jan. 1,1916, to Dec. 31,1916 34 Jan. 1,1917, to Dec. 31,1917 Cleveland: Nov. 16,1914, to Dec. 31, 1915 Jan. 1,1916, to Dec. 31,1916 Jan. 1,1917, to Dec. 31,1917 Kichmond: Nov. 16,1914, to Dec. 31, 1915 Tan 1 1916 to DPP ^1 lQlfi Jan. 1,1917, to Dec. 31,1917 CO CO Low. 3 3 3 3 6 4 OC OC CO CO Within 15 days, including Trade Trade ac- Commodity 11 to 30 member 16 to 30 31 to 60 61 to 90 Over 90 acceptances ceptances, paper days. co b l a la n t k e s r ' al days. days. days. days. wi d t a h y in s . 60 6 d 1 a t y o s . 90 w d it a h y in s. 1 90 notes. High. Low. High. Low. High. Low. High. Low. High. Low. High. Low. High. Low. High. Low. High. 6 4 6 4 6 4 6 5 34 34 34 34 34 4 34 4 4 4 4 5 5 34 3 34 3 4 4 34 5 4 5 4 5 4 5 5 4 34 4 34 4 54 4 6 4 6 4 6 5 34 34 34 34 4 4 4 4 4 4 5 5 34 34 34 34 34 3 44 4 44 4 44 4 5 5 4 34 4 34 54 4 6 4 6 4 6 44 3 3 3 3 4 4 4 4 4 4 44 44 34 3 34 3 4 3 44 4 44 4 44 4 5 44 4 34 4 34 6 4 6 4 6 44 6 5 34 34 4 4 4 4 44 4 44 44 5 5 34 3 4 34 4 34 44 4 44 4 44 44 5 5 4 3 4 4 4 6 4 6 4 6 4 6 5 34 34 4 4 4 4 4 44 34 34 4 34 4 34 44 4 44 4 44 4 44 44 4 34 4 34 CO CO CO Low. 34 34 4 3 3 34 I 4 4 3 - 3 34 3 34 34 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Discount rates (high and low) in force during the period from Nov. 16, 1914, to Dec. JJ, 1917—Continued. to MATURITIE S—Continued. Within 10 days. High. Low. Atlanta: Nov. 16,1914, to Dec. 31,1915 6 4 Jan. 1,1916, to Dec. 31,1916 . 4 4 Jan. 1,1917, to Dec. 31,1917 Chicago: Nov. 16,1914, to Dec. 31,1915 6 Jan. 1,1916, to Dec. 31,1916 Jan. 1,1917, to Dec. 31,1917 St. Louis: Nor. 16,1914, to Dec. 31,1915. 6 Jan. 1,1916, to Dec. 31,1916 3 Jan. 1,1917, to Dec. 31,1917 . Minneapolis: Nov. 16,1914, to Dec. 31,1915 6 Jan. 1,1916, to Dec. 31,1916.. 4 Jan 1 1917 to Dec 31 1917 Kansas City: Nov. 16,19i4, to Dec. 31,1915 6 Jan. 1,1916, to Dec. 31,1916 41 Tin 1 1917 to Dec 31 1917 OC OC CO CO Within 15 days, 1 d 1 a t y o s . 30 i m n b c e a l m u n d k b i s e n ' r g 1 d 6 a t y o s 3 . 0 3 d 1 a t y o s 6 . 0 6 d 1 a t y o s . 90 O d v a e y r s 9 . 0 ac w c T i d e t p r a h a y t i a n d s n e . 6 c 0 es c T e 6 r p d 1 a t a d a t y o e n s c a 9 . e c 0 s - , C w o d p i m t a a h m y p in s e o . r d 1 9 i 0 ty collateral notes. High. Low. High. Low. High. Low. High. Low. High. Low. High. Low. High. Low. High. Low. High. 6 4 4 61 61 41 31 31 31 31 4 4 4 4 4 4 5 5 31 31 31 3-J 4 31 4* 4 41 4 41 4 5 5 4 31 4 31 6 4 6 4 6 6 5 4 4 41 4 41 41 5 5 31 31 31 31 4 31 41 4 41 4 5 41 51 5 31 31 4 31 6 4 6 4 6 4 6 5 3a- 31 31 4 4 ' 4 4 4 4 5 41 3 31 3.1, 4 3* 41 4 4 41 4 41 4 3 4 3 V 4 6 4 4 41 61 5 4 4 4 4 4 41 41 5 5 31 31 31 31 4 i 41 4 41 4 5 41 51 5 31 31 4 31 31 6 4 4 4 61 5 31 31 31 4 41 4 41 4 5 5 4 31 4 4 4 41 41 4i 41 41 5 5 4 OC OC OC CO CO C' MM MM Low. 3 31 4* 3 4 OC OC OC CO CO CO CO CO C & a fed W o i 3 3 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Dallas: Nov. 16,1914, to Dec. 31,1915 64 4 64 4 64 44 34 1 4 3 Jan. l, 1916, to Dec. 31,1916 4 4 4 4 44 44 34 4 34 3 J£ Jan. 1,1917, to Dec. 31,1917 34 44 4 44 4 5 44 34 4 34 34 §§ San Francisco: Nov. 16,1914, to Dec. 31,1915 64 4 64 44 64 6 3 34 34 (2) Jan. 1,1916, to Dec. 31,1916 4 4 % 44 6 54 3 34 34 (2) Jan. l, 1917, to Dec. 31,1917 34 44 34 14 44 54 5 V 4 i 3 (2) w Commodity rates were established during September and October, 1915, and merged with those for commercial paper of corresponding maturities in November and December, 1917. 2 Commodity paper rates for bills maturing within 30 days, 34 per cent; 31 to 60 days, 4 per cent; 61 to 90 days, 44 per cent. o 3 Oct. 20,1917, rate of 3i per cent for commodity paper maturing within 60 days and 4 per cent for paper maturing after 60 days but within 90 days. w H o ft w r w w o Co Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Exhibit B.—FEDERAL RESERVE NOTES. Net amount of Federal Reserve notes received from the Comptroller of the Currency, issued to each Federal Reserve Bank, and in actual circulation; gold and eligible paper held by each Federal Reserve Agent, also amounts of Federal Reserve notes held by*each Federal Reserve Bank on the last Friday in each month during the calendar year 1917. [In thousands of dollars; i. e., 000's omitted.] Boston. Y N o e r w k. d P el h p i h la i - a. C la le n v d e . - m R o ic n h d - . Atlanta. Chicago. St. Louis. M ap i o n l n i e s. - K C a i n t s y a . s Dallas. Sa c n i s F co ra . n- Total. Federal Reserve notes received from the Comptroller of the Currency less returned for destruction: Jan. 26 21,108 125,510 24,140 13,614 22,098 31,291 10,161 19,803 25,506 25,807 30,257 15,727 365,022 Feb. 23 25,254 184,546 30,376 19,132 21,125 31,800 15,833 19,267 30,864 26,161 29,373 16,208 449,939 3 Mar.30 24,724 231,590 31,510 22,345 20,337 31,227 30,679 19,350 28,716 33,981 29,107 16,217 519,783 W Apr.27 30,133 261,494 35,273 26,859 19,722 30,791 49,003 20,422 29,013 35,762 29,049 18,954 586,475 May 25 29,390 310,620 48,713 29,974 19,694 30,335 62,816 20,668 29,205 34,295 28,405 21,854 665, 969 June 29 39,960 350,352 51,846 42,068 20,606 29,796 94,383 21,639 30,662 35,680 27,790 24,388 769,170 July 27 44,841 367,890 56,705 45,820 21,245 30,303 103,553 25,188 32,452 35,111 27,404 26,103 816,615 Aug. 31 50,296 377,492 60,472 57,464 25,094 30,621 113,788 27,194 31,660 37,105 32,815 28,435 872,436 Sept. 28 56,074 394,620 62,118 63,684 34,191 41,358 129,397 31,927 38,691 40,042 43,766 36,483 972,351 Oct. 26 64,651 426,744 78,360 75,155 45,993 50,179 146,532 48,372 48, 711 46,260 52,686 39,134 1,122,777 Nov.30 74,221 490,337 95,435 94,435 58,485 70,097 185,658 61,738 52,283 59,375 55,689 58,402 1,356,155 Dec. 28 83,817 553,939 107,486 119,650 62,680 78,757 226,080 64,153 55,606 66,862 56,242 73,905 1,549,177 Federal Reserve notes issued to Federal Reserve Banks (net amount): W Jan. 26 : 13,898 107,490 16,880 10,514 18,098 23,156 7,161 16, 763 19,886 20,849 22,271 14,727 291,693 O Feb. 23 14,694 134,546 21,136 13,232 17,225 21,415 13,333 16,227 20,344 22,623 20,486 16,208 331,469 Mar.30 17,124 165,910 25,710 15,645 16,737 20,422 25,139 15,010 20,271 23,223 21,156 16,217 382,564 Apr.27 21,383 193,594 30,433 21,919 16,522 19,836 40,303 15,482 22,563 24,992 20,563 18,954 446,544 May 25 22,640 208,620 33,373 27,334 17,014 19,130 52,476 16,408 23,365 25,955 19,919 21,854 488,088 June 29 27,460 229,252 41,906 34,428 17,496 19,391 67,763 17,979 24,772 26,140 19,529 24,388 550,504 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

July 27 31,891 240,170 42,205 39,880 18,155 21,563 73,653 20,368 25,862 25,671 18,943 26,103 584,464 Aug. 31 35,796 257,572 45,472 44,024 21,994 24,661 84,688 23,204 26,870 27,825 24,370 28,435 644,911 Sept. 28 40,674 282,300 53,318 52,244 31,871 34,428 99,497 28,317 32,761 30,162 35,021 36,483 757,076 Oct. 26 51.251 315, 224 63,320 64,215 44,313 47,069 116,632 41,322 40,421 37,580 42,906 39,134 903,387 Nov. 30 63.641 376,917 81,355 80,495 55,485 59,157 147,358 58,828 47,193 49,475 48,039 58,402 1,126,345 Bee. 28 74,297 456,339 97,326 105,710 60,840 66,887 187,780 61,863 51,016 58,062 47,727 73,905 1,341,752 Gold coin and certificates held by or to credit of Federal Reserve agent: Jan. 26 13,898 107,490 16,880 10,514 13,808 18,525 7,161 12,416 17,386 18,914 21,601 14,727 273,320 Feb. 23 14, 694 134,546 17,076 13,232 10,565 17,634 13,333 12,380 17,244 18,788 20,486 16,208 306,186 Mar. 30 17,124 165,910 22,360 15,645 10,209 17,591 25,139 11,663 16,971 21,818 20,019 16,219 360,668 Apr. 27 21,383 193,594 26,283 21,919 5,935 17,265 40,303 13,435 20,553 24,046 19,235 18,954 422,905 May 25 22,640 208,620 30,463 27,334 5,655 16,859 52,476 9,781 19,205 24,090 17,634 21,854 456,611 June 29 22,460 139,252 33,606 34,428 7,318 16,320 62,003 9,472 21,576 14,830 16,986 24,388 402,639 July 27 21,891 173,670 32,905 30,880 7,483 18,072 56,653 14,911 21,366 14,635 15,624 26,103 434,193 Aug. 31 25, 796 208,072' 32,072 33,024 8,714 20,650 70,568 16,537 16,274 17,428 15,615 28,435 493,185 Sept. 28 25,623 212,300 40,418 36,244 15,955 30,117 88,537 17,270 21,965 20,748 22,471 26,579 558,227 Oct. 26 35,371 187,224 48,220 47,715 28,729 40,058 81,372 27,075 35,625 30,620 26,303 26,380 614,692 Nov. 30 29,921 171,097 52,025 51,995 31,867 42,341 104,783 45,831 34,197 30,146 29,023 38,598 661.824 Dec. 28 37,897 250,599 56,946 55,410 31,602 49,821 124,400 32,366 31,920 42,052 25,037 43,801 781,851 Eligible paper held by Federal Reserve agent: Jan. 26 4,649 4,655 4,347 2,500 1,941 1,023 19.115 Feb. 23 4,062 8,119 3,809 3,850 3,100 3,836 1,842 28,618 Mar. 30 3,390 6,728 2,856 3,352 3,300 1,423 2,001 23.050 Apr. 27 4,186 11,285 2,575 2,053 2,010 1,114 2,758 25, May 25 2,917 11,987 2,279 6,635 4,160 1,892 2,815 32, June 29 5,026 90,523 8,306 14,134 3,078 5,876 8,513 3,196 11,528 3,218 153, July 27 10,116 77,860 9,301 9,069 18,389 3,498 17,199 5,462 4,496 11,099 4,175 170,664 Aug. 31 10,017 50,155 13,404 11,000 16,428 4,017 14,339 6,670 10,596 10,402 9,191 156,219 Sept. 28 15,069 70,822 12,906 16,012 19,182 4,329 11,178 11,054 11,139 9,992 12,647 10,137 204,467 Oct. 26 15,899 133,130 15,105 16,508 17,051 9,331 35,783 14,258 8,886 7,380 17,297 13,076 3033704 Nov. 30 33,758 207,362 29,359 29,558 30,147 16,875 43,186 13,012 13,392 19,777 20,000 34,506 490,932 Dec. 28 36,668 213,400 40,981 50,825 43,386 17,805 64,133 38,765 19,836 16,244 23,241 41,421 606,705 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Net amount of Federal Reserve notes received from the Comptroller of the Currency, issued to each Federal Reserve Bank, and in actual circulation; gold and eligible paper held by each Federal Reserve Agent, also amounts of Federal Reserve notes held by each Federal Reserve Bank on the last Friday in each month during the calendar year 1917—Continued. [In thousands of dollars; i. e., 000's omitted.] Boston. Y N o ew rk - . d P el h p i h la i - a. C la le n v d e . - m R o ic n h d - . Atlanta. Chicago. St. Louis. M ap i o n l n is e . - K C a i n ty sa . s Dallas. Sa c n is F co ra . n- Total. Federal Reserve notes held by banks: Jan. 26 ! 1; 069 18,927 1,342 541 734 1,695 702 2,642 Ill 276 2,993 31,925 Feb. 23 ! 839 14,958 974 859 620 846 2, 738 1,020 2,108 654 236 2,446 28,298 Mar. 30 ! 1,754 10,035 1,529 753 818 942 4,559 850 589 828 401 1,896 24,954 Apr. 27 | 2, 772 10,974 1,364 I 1,397 776 785 4,061 490 828 1,266 224 1,098 26,035 May 25 j 2,051 17, 225 729 I 1,699 965 502 5,425 928 974 932 246 2,010 33,686 June 29 j 2,930 22,080 2,202 I 1,512 712 544 6,029 742 1,060 797 429 2,660 41,697 July 27 5,407 26,988 780 2,398 609 1,65:5 4,841 1,966 1,593 726 482 3,006 50, 449 Aug. 31 5,381 27,948 2,269 1,642 635 1,559 5,930 1,510 2,385 3,665 398 3,674 56,996 Sept. 28 3,759 25,901 2,291 2, 754 2,714 1,910 4,664 1,846 1,872 2,231 212 6,710 56,864 Oct. 26 1 3,319 26,426 3,707 3,217 1,417 1,522 4,488 2,740 1,182 2,997 292 4,574 55, 8S1 Nov. 30 ...j 2,198 34,581 3,720 3,585 1,912 1,355 4, 795 4, 762 1,408 2,782 342 7,922 69,3H2 Dec. 28 ! 2,083 59,369 3,683 3,489 2,645 1,379 9,695 1,590 1,412 2,763 551 6,605 95,264 Federal Reservenotesissuedbyeach Federal I Reserve Bank and in actual circulation: Jan. 26 12,829 88,563 15,538 9,621 17,557 22,422 5,466 16,061 17,244 20, 738 21,995 11,734 259,768 Feb. 23 13,8.55 119,588 20,162 12,373 16,605 20,569 10,595 15,207 18,236 21,969 20,250 13,762 503,171 Mar. 30 15,370 155,875 24,181 14,892 15,919 19,480 20,580 14,160 19,682 22,395 20,755 14,321 357,610 Apr. 27 18,611 182,620 29,069 20,522 15, 746 19,051 36,242 14,992 21,735 23,726 20,339 17,856 420,509 May 25 20,589 191,395 32,644 25,635 16,049 18,628 47,051 15,480 22,391 25,023 19,673 19,844 454,402 June 29 24,530 207,172 39,704 32,916 16, 784 18,847 61, 734 17,237 23,712 25,343 19,100 21,728 508,807 July 27 26,484 213,182 41,425 37,482 17,546 19,910 68,812 18,402 24,269 24,945 18,461 23,097 534,015 Aug. 31 30,415 229,624 43, 203 42,382 21,359 23,102 78, 758 21,694 24,485 24,160 23,972 24, 761 587,915 Sept. 28 36,915 256,399 51,027 49,490 29,157 32,518 94,833 26,471 30,889 27,931 34,809 29,773 700,212 Oct. 26 47,932 288, 798 59, 613 60,998 42,896 45,547 112,144 38,582 39,239 34,583 42,614 34,560 847,506 Nov. 30 61,443 342,336 77,635 76,910 53,573 57,802 142,563 54,066 45,785 46,693 47,697 50,480 1,056,983 Dec. 28 72,214 396,970 93,643 102, 221 58,195 65,508 178, 085 60,273 49,604 55,299 47,176 67,300 1, 246,488 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

ANNUAL BEPOBT OF THE FEREBAL BESEKVE BOABD. 47 Federal Reserve notes outstanding (i. e. net amount issued to banks), in actual circula" t tion, and gold and paper collateral held by Federal Reserve Agents against outstanding notes. [In thousands of dollars; i. e., 000's omitted.] Paper collateral for notes Gold cover for notes issued. Federal i a R R s F B m s ne e e u a n os d s o e n e e e t e u d e k r t r r n vs v s a t t e e , o l . c c o v c G e i a a r n i o u t n t i e l a f l d s t i n . - d r I U e n T S f d t n u t i r g e a i n o e t o m t d a n e e l s d , d p s - - ' R I F B s f n m e e e u o d s t n g e a t e e l o d n r r e r d l v , t a - d . e l T go o l t d a . l r A e m qu o i u re n d t . a A m h c e o t l u u d a n . l t o E f h x p e c a l e d p s . e s r R F R F h B n e e e e e a d o s l d s n d e e e t e e r k r r r b v v s a a s y e e l . l a c n R F c u o t e e l u t a d s e a e t e s i l r r o v c i a n n i e l r . urer. 1917. Jan. 5 300,280 166,827 14,855 99,610 281,292 18,988 20,272 1,284 27,407 272,873 12 293,440 162,877 14,125 97,510 274,512 18,928 20,845 1,917 25,272 268,168 18-19.. 292,014 163,877 13,554 95,710 273,141 18,873 20,366 1,493 29,047 262,967 '26 291,693 166,174 13,436 93,710 273,320 18,373 19,115 742 31,925 259,768 Feb. 2 290,577 166,374 12,650 95,050 274,074 16,503 19,692 3,189 30,547 260,030 9 308,348 178,344 15,126 95,250 288,720 19,628 21,715 2,087 29,825 278,523 16 321,453 188,144 15,006 94,120 297,270 24,183 26,746 2,563 29,614 291,839 23 331,469 194,094 14,722 96,560 306,186 25,283 28,618 3,335 28,298 303,171 Mar. 2 343,847 204,194 15,587 97,800 317,581 26,266 28,700 2,424 29,589 314,258 9 355,263 212,094 14,959 101,380 328,433 26,830 29,686 2,856 28,651 326,612 16 363,278 218,609 15,379 104,620 338,608 24,670 26,189 1,519 27,217 336,061 23 372,244 219,836 14,353 115,330 349,519 22,725 24,386 1,661 25,440 346,804 30 382,564 222,377 17,631 120,660 360,668 21,898 23,050 1,152 24,799 357, 765 Apr. 5-6 400^ 698 234,573 17,697 126,180 $78,450 22,253 23,554 1,301 24,188 3fl6, 510 13 431,788 248,313 18,583 143,900 410,796 20,998 22,594 1,596 29,979 401,809 20 440, 539 252,194 18,644 147,700 418,538 22,001 23,826 1,825 26,182 414,357 27 446,544 253,944 20,931 148,030 422,905 23,639 25,981 2,342 26,035 420,509 May 4 458,874 258,885 20,634 153,570 433,089 25,785 27,343 1,558 30,372 428,502 11 470,401 261,025 21,028 156,270 438,323 32,078 32,776 698 32,183 438,218 18 . 478,906 264,635 20,596 163,080 448,311 30,595 32,421 1,826 32,405 446,501 25 488,088 264,468 23,233 168,910 456,611 31,477 32,685 1,208 33,686 454,402 June 1 499,844 271,365 23,314 172,290 466,969 32,875 34,441 1,566 34,979 464,865 8 512,527 273,682 24,339 177,180 475,201 37,326 37,930 606 31,058 481,469 15 527,971 255,674 24,538 1;79,730 459,942 68,029 69,151 1,122 36,356 491,615 22 539,976 187,667 24,268 178,830 390,765 149,211 153,136 3,925 40,255 499,721 29..-.'. 550,504 198,239 23,620 180,780 402,639 147,865 153,398 5,533 41,697 508,807 July '6 570, 725 203,120 22,805 187,790 413,715 157,010 162,733 5,723 43,266 527,459 "13 579,957 218,118 23,190 187,030 428,338 151,619 158,473 6,854 47,449 532,508 20 583,937 218,358 22,801 182,730 423,889 160,048 168,233 8,185 49,711 534,226 27 584,464 230,331 21,568 182,294 434,193 150,271 170,664 20,393 50,449 534,015 Aug. 3 590,389 262,328 22,864 182,653 467,845 122,544 133,478 10,934 49,604 540,785 10 601,227 277,698 24,676 183,093 485,467 115,760 125,588 9,828 51,983 549,244 17 613,646 287,793 25,051 189,744 502,588 111,058 120,711 9,653 54,864 558,782 24 627,307 269,015 25,780 193,741 488,536 138,771 146,664 7,893 54,258 573,049 31 644,911 269,170 24,974 199,041 493,185 151,726 156,219 4,493 56,996 587,915 Sept. 7 680,073 256,127 25,232 213,420 494,779 185,294 187,218 1,924 58,774 621,299 14 700,430 272,682 26,452 221,336 520,470 179,960 192,200 12,240 55,863 644,567 21.... 725,397 278,534 28,801 228,674 536,009 189,328 198,887 9,559 55,151 670,246 28.... 757,076 276,645 28,028 253,554 558,227 198,849 204,467 5,618 56,864 700,212 Oct. 5 797,630 269,471 29,097 261,543 560, 111 237,519 248,912 11,393 56,714 740,916 11-12.. 837,425 274,221 30,430 276,083 580,734 256,691 263,164 6,473 57,540 779,885 19 875,278 282,351 31,604 304,872 618,827 256,451 270,185 13, 734 60,068 815,210 26 903,387 267,166 33,204 314,322 614,692 288,695 303,704 15,009 55,881 847,506 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

48 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. Federal Reserve notes outstanding (i. e., net amount issued to banks), in actual circulation, and gold and paper collateral held by Federal Reserve Agents against outstanding notes—Continued. [In thousands of dollars; i. e., 000's omitted.] Paper collateral for notes Gold cover for notes issued. issued. Federal Reserve Federal i a R F s B s m n e e u a n o d s o n e e e t e d u e k t r r v s n s a t , e o l t. jo c v G c i e a n a i r o u n t t a i e l l f d t s n i . - d r I U e S T n f u d t u n t i r r g e a o n e i e m o t t a d n r e e l s . , p d s d - - R I F B s n m f e e e u o d s t g e n a t e e l n o r d r e r d v l t , a - d . e l T go o l t d a . l A re m qu o i u re n d t . a A m h c e o t l u u d a n . l t o E f h x p e c a l e d p s . e s r h R F R B e n e e e a l o d s d s n e t e e e k r b r r v s v s a y . e l e a c n F R c u o t e e u l t d s a e a e e t s l r i r c o v a i i n n l e r- . 1917. Nov. 2.. 941,284 249,495 32,111 320,827 602,433 338,851 365,107 26,256 60,283 881,001 9.. 995,384 250,689 32,187 333,378 616,254 379,130 439,202 60,072 62,872 932,512 16.. 1,038,620 243,030 31,843 355,033 629,906 408,714 431,182 22,468 66,035 972,585 23.. 1,102,287 243,111 32,524 348,313 623,948 478,339 532,411 54,072 86,395 1,015,892 30.. 1,126,345 242,985 33,714 385,125 661,824 464,521 490,932 26,411 69,362 1,056,983 Dec. 7... 1,184,667 240,351 35,773 407,815 683,939 500, 728 536,473 35,745 74,130 1,110,537 14... 1,229,007 239,833 39,471 404,074 683,378 545,629 602,967 57,338 75,622 1,153,385 21... 1,295,069 227,302 41,281 477,524 746,107 548,962 602,074 53,112 67,427 1,227,642 28... 1,341,752 250,423 41,479 489,949 781,851 559,901 606,705 46,804 95,264 1,246,488 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

ANNUAL REPOET OF THE FEDEEAL RESERVE BOARD. 49 FEDERAL RESERVE NOTES OUTSTANDING AND INCIRCULATION DURIN6 1917, ALSO AMOUNTS OF GOLD AND REQUIRED PAPER § HELD BY FR. AGENTS. j Curve /, JJmounJts of Cold Cover held against SJtMtes issued. Curve Z: JJmounts of '<£**%. JVotes outstanding, (-Cold Cover, filusJhfterCollateral requircjl). Curve 3. Amounts of£"M.JYotes OzJJctual Circulation,, (- Ji1 mounts Outstandingr> less Amounts field . by ^BanKs and in jtrocess of Redemption,). j j i i i i i I i i 1 i i i I l I I 1 1 1 1 1 1 1 1 1 1 1 II 1 1 II 1 M 1 1 H 1 1 1 1 1 1 1500 mo - — 1300 zoo IlOO \ • ^ ^.l / i/ 1000 i f " i' 900 __ ^^ ~N ^^ SOO ^^ N^^ \ ,S 700 x^ "<$ &#45;&#45;&#45; 600 SOO M ^. ^ ^'^^^ i ' S^.^ TI t 4v A \ bv 400 "*r^ ** 300 --<Tcr £\—Cr Vki%'~ 200 100 Q m m Wem 7ir/t )?/J*"~7iWk'f -\f j '/ j-; n? 7J ,1 K> ' p.? 1 1 B 9 E 2 R 6 2 \ M ,. 0 f ?33 \ SRALLOD FO SNOILLIM | -1400 -BOO -1200 -Km 900 -600 QY) 400 -300 9stn inn Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

50 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. Statement of Federal Reserve notes, by denominations, printed, shipped to Federal Reserve agents and United States subtreasnries. and on hand in reserve vault Dec. 31, 1917. Bank. Fives. Tens. Twenties. Fifties. Hundreds. Total. Boston: Printed $43,320,000 $49,080,000 $19,280,000 $12,800,000 $20,000,000 $144,480,000 Shipped 27,160,000 48,920,000 18,560,000 6,600,000 12,000,000 113,240,000 On hand 16,160,000 160,000 720,000 6,200,000 8,000,000 31,240,000 New York: Printed 332,600,000 339,280,000 168,080,000 47,400,000 126,800,000 1,014,160,000 Shipped 156,200,000 251., 160,000 155,520,000 46,200,000 95,600,000 704,680,000 On hand 176,400,000 88,120,000 12,560,000 1,200,000 31,200,000 309,480,000 Philadelphia: Printed 29,000,000 37., 960,000 44,560,000 16,000,000 20,400,000 147,920,000 Shipped 26,440,000 37,960,000 44,080,000 12,800,000 14,400,000 135,680,000 On hand 2.560,000 480,000 3,200,000 6,000,000 12,240,000 Cleveland: Printed . .. 27,160,000 43., 320,000 66,480,000 23,200,000 11,200,000 171,360,000 Shipped 15,040,000 32,040,000 60,400,000 19,400,000 9,600,000 136,480,000 12,120,000 11,280,000 6,080,000 3,800,000 1,600,000 34,880,000 Richmond: Printed 23,340,000 28,560,000 27,920,000 7,600,000 7,600,000 95,020,000 Shipped 16,940,000 25.640,000 26,720,000 5,200,000 3,600,000 78,100,000 On hand 0,400,000 2, 920,000 1,200,000 2,400,000 4,000,000 16,920,000 Atlanta: Printed 24,740,000 32,280,000 35,600,000 8,000, 000 10,400,000 111,020,000 Shipped 23,880,000 31,680,000 30,240,000 4,200,000 5,200,000 95,200,000 On hand 860,000 600,000 5,360,000 3,800,000 5,200,000 15,820,000 Chicago: Printed 64,080,000 87,080,000 103,120,000 32,400,000 30,000,000 316,680,000 Shipped 36,460,000 87,080,000 103,120,000 19,000,000 17,600,000 263,260,000 On hand 27,620,000 13,400,000 12,400,000 53,420,000 St. Louis: Printed 29,940,000 27,760,000 24,800,000 '), 000,000 4,800,000 92,300,000 Shipped 21,380,000 27,680,000 23,600,000 4,000,000 4,400,000 81,060,000 On hand 8,560,000 80,000 1,200,000 1,000,000 400,000 11,240,000 Minneapolis: Printed 29,900,000 27,520,000 24,880,000 3,400,000 4,400,000 90,100,000 Shipped 24,900,000 26,200,000 22,080,000 1,600,000 3,200,000 77,980,000 On hand 5,000,000 1,320,000 2,800,000 1,800,000 1,200,000 12,120,000 Kansas City: Printed 43,520,000 32,080,000 31,120,000 7,200,000 6,400,000 120,320,000 Shipped 29,180,000 26,560,000 28,560,000 4,600,000 3,600,000 92,500,000 On hand 14,340,000 5,520,000 2,560,000 2,600,000 2,800,000 27,820,000 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. 51 Statement of Federal Reserve notes, by denominations, printed, shipped to Federal Reserve agents and United States subtreasuries, and on hand in reserve vault Dec. 31, 1917— Continued. Bank. Fives. Tens. Twenties. Fifties. Hundreds. Total. Dallas: Printed 20,040,000 26,320,000 24,880,000 6,000,000 7,600,000 84,840,000 Shipped 17,720,000 24,000,000 23,920,000 2,800,000 4,000,000 72,440,000 On hand 2,320,000 2,320,000 960,000 3,200,000 3,600,000 . 12,400,000 San Francisco: Printed 20,640,000 29,320,000 30,480,000 14,000,000 16,400,000 110,840,000 Shipped 20,340,000 24,080,000 30,320,000 13,000,000 16,000,000 103,740,000 On hand 300,000 5,240,000 160,000 1,000,000 400,000 7,100,000 Vault balance: Total printed 688,280,000 760,560,000 601,200,000 183,000,000 266,000,000 2,499,040,000 Total shipped 415,640,000 643,000,000 567,120,000 139,400,000 189,200,000 1,954,360,000 Total on hand 272,640,000 117,560,000 34,080,000 43,600,000 76,800,000 544,680,000 Federal Reserve notes by denominations issued through the Federal Reserve agents to the banks, also amounts retired and outstanding Dec. 31, 1917. Bank. Fives. Tens. Twenties. Fifties. Hundreds. Total. Boston: Issued $22,546,600 .148,525,600 $14,488,200 $4,102,000 $7,002,300 $96,664,700 Retired 9,712,440 8,048,170 693,120 352,650 561,500 19,367,880 Outstanding 12,834,160 40,477,430 13,795,080 3,749,350 6,440,800 77,296,820 New York: Issued 133,290,350 213,247,800 133,958,400 37,002,450 84,014,000 601,513,000 Retired 55,390,660 49,191,995 13,228,530 882,750 26,480,500 145,174,435 Outstanding 77,899,690 164,055,805 120,729,870 36,119,700 57,533,500 456,338,565 Philadelphia: Issued 20,692,700 38,594,800 44,830,200 5,890,000 7,550,000 117,557,700 Retired 7,818,955 7, 644,000 4,302,290 106,400 360,300 20,231,945 Outstanding 12,873,745 30,950,800 40,527,910 5,783,600 7,189,700 97,325,755 Cleveland: Issued 11,620,000 26,640,000 54,800,000 16,000,000 5,600,000 114,660,000 Retired 2,672,250 2,931,940 2,934,860 299,250 152,000 8,990,300 Outstanding 8,947,750 23,708,060 51,865,140 15,700,750 5,448,000 105,669,700 Richmond: Issued 18,194,300 27,067,700 28,529,400 5,512,200 3,482,000 82,785,600 Retired 7,157,645 7,160,650 5,647,520 1,505,950 543,700 22,015,465 Outstanding 11,036,655 19,907,050 22,881,880 4,006,250 2, 938,300 60,770,135 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

52 ANNUAL REPORT1 OF THE FEDERAL RESERVE BOARD. Federal Reserve notes by denominations issued through the Federal Reserve agents to the banks, also amounts retired and outstanding Dec. 3, 1917—Continued. Bank. Fives. Tens. Twenties. Fifties. Hundreds. Total. Atlanta: Issued... „ 25,144,050 33,645,800 28,860,980 3,730,450 2,442,900 93,824,180 Retired 9,971,965 8,912,195 5,343,600 1,511,000 1,218,000 26,956,760 Outstanding 15,172,085 24,733,605 23,517,380 2,219,450 1,224,900 66,867,420 Chicago: Issued 22,920,050 70,000,000 82,800,600 11,600,250 10,800,100 198,121,000 Retired 3,775,000 1,560,730 1,727,840 221,900 47,000 7,332,470 Outstanding 19,145,050 68,439,270 81,072,760 11,378,350 10,753,100 190,788,530 St. Louis: Issued 18,632,950 28,672,940 23,452,160 2,960,050 2,550,000 76,268,100 Retired 6,073,900 4,439,950 2,248,670 740,550 901,600 14,404,670 Outstanding 12,559,050 24,232,990 21, 203,490 2,219,500 1,648,400 61,863,430 Minneapolis: Issued 21,082,000 22,695,000 19,655,000 1,010,000 1,670,000 66,112,000 Retired 8,151,565 3,998,565 2,604,420 148,900 202,600 15,106", 050 Outstanding 12,930,435 18,696,435 17,050,580 861,100 1,467,400 51,005,950 Kansas City: Issued 25,984,000 22,090,000 26,954,000 6,610,000 1,790,000 83,428,000 Retired 10,070,640 4,977,690 5,437,050 5,054,100 5,100 25,544,580 Outstanding 15,913,360 17,112,310 21,516,950 1,555,900 1,784,900 57,883, 420 Dallas: Issued 15,380,000 28,440,900 26,618,600 3,270,650 4,635,000 78,345,150 Retired 7,138,565 11,229,565 7,499,770 1,566,700 3,193,600 30,628,200 Outstanding 8,241,435 17,211,335 19,118,830 1,703,950 1,441,400 47,716,950 San Francisco: Issued 17,140,000 20,960,000 30,320,000 6,400,000 11,600,000 86,420,000 Retired 4,657,540 2,539,890 1,763,070 166,050 195,900 9,322,450 Outstanding 12,482,460 18,420,110 28,556,930 6,233,950 11,404,100 77,097,550 KECAPITULATION. Total issued 352,627,000 580,580,540 515,267,540 104,088,050 143,136,300 1,695,699,430 Total re tired 132,591,125 112,635,340 53,430,740 12,556,200 33,861,800 345,075,205 Total outstanding 220,035,875 467,945,200 461,836,800 91,531,850 109,274,500 1,350,624,225 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A-tfNUAL EEPOET OP THE FEDERAL RESERVE BOARD. 53 Statement of Federal Reserve notes, by denominations, received by agents, issued to the banks, returned to the Comptroller for destruction, since organization of banks, and on hand Dec. 31, 1917, as reported by Federal Reserve agents. RECEIVED FROM COMPTROLLER OF THE CURRENCY. Federal Reserve Fives. Tens. Twenties. Fifties. Hundreds. Total. agent at— Boston . $24,160,000 $48,920,000 $14,880,000 $5,600,000 $5,600,000 $103,160,000 New York 151,200,000 241,160,000 151,520,000 44,200,000 91,600,000 679,680,000 Philadelphia 22,440,000 37,960,000 44,080,000 9,800,000 11,200,000 125,480,000 Cleveland 13,040,000 29,640,000 59,840,000 18,400,000 7,600,000 128,520,000 Richmond 16,940,000 25,640,000 26,720,000 5,200,000 3,600,000 78,100,000 Atlanta 22,820,000 30,680,000 28,720,000 3,800,000 3,600,000 89,620,000 Chicago 28,460,000 77,600,000 97,120,000 16,600,000 15,200,000 234,980,000 St. Louis 16,580,000 27,520,000 23,600,000 3,000,000 2,400,000 73,100,000 Minneapolis 19,700,000 24,240,000 20,240,000 1,400,000 2,400,000 67,980,000 Kansas City 25,540,000 22,160,000 25,040,000 3,200,000 2,800,000 78,740,000 Dallas 15,140,000 23,280,000 23,280,000 2,800,000 4,000,000 68,500,000 San Francisco 15,340,000 19,880,000 30,320,000 6,400,000 11,600,000 83,540,000 Total 371,360,000 608,680,000 545,360,000 120,400,000 165,600,000 1,811,400,000 RETURNED BY FEDERAL RESERVE BANKS. Boston $9,712,440 $8,048,170 $693,120 $352,650 $561,500 $19,367,880 New York 55,390,660 49,191,995 13,228,530 882, 750 26,480,500 145,174,435 Philadelphia... 7,818,955 7,644,000 4,302,290 106,400 360,300 20,231,945 Cleveland 2,672,250 2,931,940 2,934,860 299,250 152,000 8,990,300 Richmond 7,157,645 7,160,650 5,647,520 1,505,950 543, 700 22,015,465 Atlanta 9,971,965 8,912,195 5,343,600 1,511,000 1,218,000 26,956, 760 Chicago 3,775,000 1,560,730 1,727,840 221,900 47,000 7,332,470 St. Louis 6,073,900 4,439,950 2,248,670 740,550 901,600 14,404,670 Minneapolis 8,151,565 3,998,565 2,604,420 148,900 202,600 15,106,050 Kansas City 10,070,640 4,977,690 5,437,050 5,054,100 5,100 25,544,580 Dallas 7,138,565 11,229,565 7,499,770 1,566,700 3,193,600 30,628,200 San Francisco.. 4,657,540 2,539,890 1,763,070 166,050 195,900 9,322,450 Total. 132,591,125 112,635,340 53,430, 740 12,556,200 33,861,800 345,075,205 TOTAL AMOUNTS FOR WHICH FEDERAL RESERVE AGENTS ARE ACCOUNTABLE. Boston $33,872,440 $56,968,170 $15,573,120 $5,952,650 $10,161,500 $122,527,880 New York , 206,590,600 290,351,995 164, 748,530 45,082, 750 118,080,500 824,854,435 Philadelphia.. 30,258,955 45,604,000 48,382,290 9,906, 400 11,560,300 145, 711, 945 Cleveland 15,712,250 32,571,940 62,774,860 18, 699,250 7, 752,000 137,510,300 Richmond 24,097,645 32,800,650 32,367,520 6, 705,950 4,143, 700 100,115,465 Atlanta 32,791,965 39,592,195 34,063,600 5,311,000 4,818,000 116,576, 760 Chicago , 32,235,000 79,160,730 98,847,840 16,821,900 15,247,000 242,312,470 St. Louis 22,653,900 31,959,950 25,848,670 3,740,550 3,301,600 87,504,670 Minneapolis 27,851,565 28,238,565 22,844,420 1,548,900 2,602,600 83,086,050 Kansas City..., 35,610,640 27,137,690 30,477,050 8,254,100 2,805,100 104,284,580 Dallas 22,278,565 34,509,565 30,779,770 4,366,700 7,193,600 99,128, 200 San Francisco. 19,997,540 22,419,890 32,083,070 6,566,050 11, 795,900 92,862,450 Total.... 503,951,125 721,315,340 598, 790, 740 132,956,200 199,461,800 2,156,475,205 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

54 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. Statement of Federal Reserve notes, by denominations, received by agents, issued to the banks, returned to the Comptroller for destruction, since organization of banks, and on hand Dec. 31, 1917, as reported by Federal Reserve agents—Continued. ISSUED TO FEDERAL RESERVE BANKS. Federal Reserve agent at— Fives. Tens. i Twenties. Fifties. Hundreds. Total. Boston $22,546,600 $48,525, 600 $14,488,200 $4,102,000 $7,002,300 $96,664, 700 New York 133,290,350 213,247,800 133,958,400 37,002,450 84,014,000 601,513,000 Philadelphia... 20,692, 700 38,594,800 44,830,200 5,890,000 7,550,000 117,557, 700 Cleveland 11,620,000 26,640,000 54,800,000 16,000,000 5,600,000 114,660,000 Richmond 18,194,300 27,067,700 28,529,400 5,512,200 3,482,000 82,785,600 Atlanta 25,144,050 33,645,800 28,860,980 3, 730,450 2,442,900 93,824,180 Chicago 22,920,050 70,000,000 82,800,600 11,600,250 10,800,100 198,121,000 St. Louis 18,632,950 28,672,940 23,452,160 2,960,050 2,550,000 76,268,100 Minneapolis... 21,082,000 22,695,000 19,655,000 1,010,000 1,670,000 66,112,000 Kansas City 25,984,000 22,090,000 26,954,000 6,610,000 1,790,000 83,428,000 Dallas 15,380,000 28,440,900 26,618,600 3,270,650 4,635,000 78,345,150 San Francisco.. 17,140,000 20,960,000 30,320,000 6,400,000 11,600,000 86,420,000 Total 352,627,000 ! 580,580,540 515,267,540 104,088,050 j 143,136,300 1,695,699,430 RETURNED TO COMPTROLLER FOR DESTRUCTION. Boston $9,705,840 $8,042,570 $684,920 $350,650 $559,200 $19,343,180 New York 55,300,310 49,104,195 12,390,130 680,300 1,666,500 119,141,435 Philadelphia.. 7,406,255 7,009,200 3,552,090 16,400 10,300 17,994,245 Cleveland 2,672,250 2,931,940 2,854,860 299,250 152,000 8,910,300 Richmond 5,743,345 5,012,950 3,678,120 793, 750 261,700 15,489,865 Atlanta 5,128,915 3, 609,895 1,928,120 90,550 125,100 10,882,580 Chicago 3,134,950 1,560, 730 1, 727,240 221,650 46,900 6,691,470 St. Louis 3,780,950 3,167,010 1,436,510 40,500 1,600 8,426,570 Minneapolis 5,269,565 3,223,565 1,349,420 18,900 22,600 9,884,050 Kansas City 7,706,640 3,167,690 1,123,050 54,100 5,100 12,056,580 Dallas 5,028,565 4,713,665 2,411,170 96,050 18,600 12,268,050 San Francisco 2,857,540 1,459,890 1,763,070 166,050 195,900 6,442,450 Total 113, 735,125 93,003,300 | 34,898,700 2,828,150 3,065,500 247,530,775 IN HANDS OF FEDERAL RESERVE AGENTS DEC. 31, 1917. Boston $1,620,000 $400,000 $400,000 $1,500,000 $2,600,000 $6,520,000 New York 18,000,000 28,000,000 18,400,000 7,400,000 32,400,000 104,200,000 Philadelphia 2,160,000 4,000,000 4,000,000 10,160,000 Cleveland 1,420,000 3,000,000 5,120,000 2,400,000 2,000,000 13,940,000 Richmond 160,000 720,000 160,000 400,000 400,000 1,840,000 Atlanta . . . . . 2,519,000 2,336,500 3,274,500 1,490,000 2,250,000 11,870,000 Chicago 6,180,000 7,600,000 14,320,000 5,000,000 4,400,000 37,500,000 St. Louis 240,000 120,000 960,000 740,000 750,000 2,810,000 Minneapolis 1,500,000 2,320,000 1,840,000 520,000 910,000 7,090,000 Kansas City 1,920,000 1,880,000 2,400,000 1,590,000 1,010,000 8,800,000 Dallas 1,870,000 1,355,000 1,750,000 1,000,000 2,540,000 8,515,000 San Francisco Total 37,589,000 47, 731,500 48,624,500 26,040,000 53,260,000 213,245,000 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. 55 Statement of Federal Reserve notes, by denominations, received by agents, issued to the banks, returned to the Comptroller for destruction, since organization of banks, and on hand Dec. 31, 1917, as reported by Federal Reserve agents—Continued. TOTAL AMOUNTS OF FEDERAL RESERVE NOTES ACCOUNTED FOR. Federal Reserve Agent Fives. Tens. Twenties. Fifties. Hundreds. Total. at— Boston $32,252,440 $56^568,170 $15,173,120 $4,452,650 $7,561,500 $116,007,880 New York 188,590,660 262,351,995 146,348,530 37,682, 750 85,680, 500 720,654, -ISo Philadelphia 28,098,955 45,604,000 48,382,290 5,906,400 7,560,300 135,551,945 Cleveland 14,292,250 29,571,940 57,654,860 16,299,250 5,752,000 123,570,300 Richmond 23,937,645 32,080,650 32,207,520 6,305,950 3,743,700 98,275,465 Vtlanta 30,272,965 37,255,695 30,789,100 3,821,000 2,568,000 104,706, 760 Chicago 26,055,000 71,560,730 84,527,840 11,821,900 10,847,000 204,812,470 St. Louis 22,413,900 31,839,950 24,888,670 3,000,550 2,551,600 84,694,670 Minneapolis 26,351,565 25,918,565 21,004,420 1,028,900 1,692, COO 75,996,050 Kansas City 33,690,640 25,257,690 28,077,050 6,664,100 1, 795,100 95,484,580 Dallas .". 20,408,565 33,154,565 29,029,770 3,366,700 4,653, COO 90,613,200 San Francisco 19,997,540 22,419,890 32,083,070 6,566,050 11,795,900 92,862,450 Total 466,362,125 673,583,840 550,166,240 106,916,200 146,201,800 1,943,230,205 RECAPITULATION. Received from Comptroller $371,360,000 $608,680,000 $545,360,000 $120,400,000 $165,600,000 $1,811,400,000 Returned by bank 132,591,125 112,635,340 53,430,740 12,556,200 33,861,800 345,075,205 Total ! 503,951,125 721,315,340 598,790,740 132,986,200 199,461,800 2,156,475,205 Issued to banks 352,627,000 580,580,540 515,267,540 104,088,050 143,136,300 1,695,699,430 Return for destruction.. 113,735,125 93,003,300 34,898,700 2,828,150 3,065,500 247,530,775 On hand. 37,589,000 47,731,500 48,624,500 26,040,000 53,260,000 213,245,000 Total 503,951,125 721,315,340 598,790,740 132,956,200 199,461,800 2,156,475,205 Mutilated Federal Reserve notes, by denominations, received and destroyed since organization of banks and on hand in vault Dec. 31, 1917. RECEIVED FOR DESTRUCTION. Bank. Fives. Tens. Twenties. Fifties. Hundreds. Total. Boston $9,635,840 $7,912,570 $664,920 $350,650 $559,200 $19,123,180 Nee York 55,300,855 49,106,405 12,390,310 680,300 1,666,600 119,144,470 Philadelphia 7,406,255 7,009,200 3,552,090 16,400 10,300 17,994,245 Cleveland 2,672,250 2,931,940 2,854,860 299,250 152,000 8,910,300 Richmond 5,743,345 5,012,950 3,678,120 793,750 261,700 15,489,865 Atlanta 5,128,915 3,609,895 1,928,120 90,550 125,100 10,882,580 Chicago 3,121,450 1,554,730 1,715,240 221,650 46,900 6,659,970 St. Louis 3,780,950 3,167,010 1,436,510 40,500 1,600 8,426,570 Minneapolis 5,269,565 3,223,565 1,349,420 18,900 22,600 9,884,050 Kansas City 7,706,640 3,167,690 1,123,050 54,100 5,100 12,056,580 Dallas 5,028,565 4,713,665 2,411,170 96,050 18, 600 12,268,050 San Francisco 2,857,540 1,469,890 1,763,070 166,050 195,900 6,452,450 Total received 113,652,170 92,879,510 34,866,880 2,828,150 3,065,600 247,292,310 Total destroyed.. 110,695,020 90, 408, 220 33,777,150 2,742,450 2,990, 700, 240,613,540 Balance on hand. 2,957,150 2, 471,290 1,089, 730 85, 700 74,900 6,678, 770 NOTE.—During the year burned, badly mutilated, and fractional parts of Federal Reserve notes amounting to $11,060 have been identified, valued, and the bank of issue determined. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

56 ANNUAL REPOBT OF THE FEDERAL RESERVE BOARD. Total amount of Federal Reserve bank currency received since organization of banks, by Comptroller of the Currency from Bureau of Engraving and Printing, issued and on hand, Dec. 31, 1917. Bank. Fives. Tens. Twenties. Fifties. Total. Philadelphia: Printed $320,000 $440,000 $240,000 0 SI, 000,000 Issued 0 0 0 0 0 On hand 320,000 440,000 240,000 0 1,000,000 Cleveland: Printed 1,000,000 2,000,000 2,000,000 0 5,000,000 Issued 0 0 0 0 0 On hand 1,000,000 2,000,000 2,000,000 0 5,000,000 Richmond: Printed 200,000 400,000 400,000 0 1,000,000 Issued • 0 0 0 0 ' 0 On hand 200,000 400,000 400,000 0 1,000,000 Atlanta: Printed . . . 640,000 480,000 480,000 400,000 2,000,000 Issued 0 0 0 0 0 On hand 640,000 480,000 480,000 400,000 2,000,000 Chicago: Printed 1,600,000 1,800,000 1,600,000 0 5,000,000 Issued 0 o 0 0 0 On hand 1,600,000 1,800,000 1,600,000 0 5,000,000 Minneapolis: Printed 1,320,000 2,680,000 0 0 4,000,000 Issued 0 0 0 0 0 On hand 1,320,000 2,680,000 0 0 4,000,000 Kansas City: Printed 4,360,000 5,040,000 3,600,000 0 13,000,000 Issued 3,414,980 4,000,000 2,640,000 0 10,054,980 On hand 945,020 1,040,000 960,000 0 2,945,020 Dallas: Printed 1,640,000 2,400,000 2,000,000 0 6,040,000 Issued 1,012,400 1,960,000 1,760,000 0 4, 732, 400 On hand 627,600 440,000 240,000 0 1,307,600 San Francisco: Printed 1,680,000 1,960,000 1,360,000 0 5,000,000 Issued 0 0 0 0 0 On hand 1,680,000 1,960,000 1,360,000 0 5,000,000 RECAPITULATION. Total printed 12,760,000 17,200,000 11,680,000 400,000 42,040,000 Total issued 4,427,380 5,960,000 4,400,000 0 14,787,380 Total on hand 8,332,620 11,240,000 7,280,000 400,000 27,252,620 NOTE.—Plates for fives,tens, twenties, fifties, and hundreds have been engraved for both Boston and New York, and fives, tens.and twenties for St. Louis, but no currency ordered printed. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. 57 Federal Reserve bank notes issued', redeemed, and outstanding, by denominations. Issued. Redeemed. Outstanding. Fives $4,427,380 $706,355 $3,721,025 Tens 5,960,000 1,014,820 4,945,180 Twenties 4,400,000 461,040 3,938,960 Total 14,787,380 2,182,215 12,605,165 COST OF FEDERAL RESERVE NOTES. The cost to each Federal Reserve Bank of Federal Reserve notes, including paper, preparing plates, and printing, but exclusive of cost of transmittal, for the calendar year 1917 was as follows: Boston $79, 552. 41 New York 548,146..61 Philadelphia 55,324. 87 Cleveland 71, 378. 22 Richmond 44, 072. 58 Atlanta 42, 020. 45 Chicago 171, 841.46 St. Louis 49, 879.01 Minneapolis 49,278. 45 Kansas City 64,147. 60 Dallas 34, 214. 69 San Francisco 35, 368.18 Total ; 1,245,224.53 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Amounts of Federal Reserve notes received from and returned to other Federal Reserve Banks for redemption or credit by each Federal Reserve Bank during Ox 00 the calendar year 1917. Boston. New York. Philadelphia. Cleveland. Richmond. Atlanta. Received. Returned, Received. Returned Received. Returned. Received. Returned. Received. Returned. Received. Returned > Boston S3,064,200 $9,552,800 $368,000 $634,700 $38,915 $352,900 $47,500 $263,900 $135,400 $193,200 r New York $9,482,800 $3,018,450 11,169,902 5,818,700 1,250,300 1,725,105 999,100 3,600,750 1,236,500 3,030,710 w w Philadelphia... 634,700 368,000 5,876,300 11,553,902 258,495 883,000 323,920 798,000 150,650 311,000 o Cleveland , 352,900 36,415 1,720,700 1,216,800 835,000 247,995 133,950 100,600 282,150 72,180 Richmond 263,900 50,500 3,680,305 993,100 798,005 336,670 101,100 145,200 862,450 268,520 w Atlanta 193,200 135,400 3,116,410 1,236,100 311,000 151,400 72,680 285,900 278,520 862,450 H Chicago 347,800 218,500 1,760,420 3,425,000 406,000 357,500 420,040 939,500 128,610 332,000 224,550 747,500 O St. Louis 99,700 53,450 664,500 878,700 113,000 90,600 176,520 226,705 34,250 122,080 424,450 820,635 H Minneapolis 142,200 16,000 844,375 390,500 122,000 17,000 77,030 53,000 44,390 17,000 95,900 29,000 Kansas City... 126,600 8,815 976,600 127,750 129,000 12,100 64,240 25,000 34,240 18,990 212,550 68,950 Dallas 141,400 283,695 1,014,415 566,920 101,000 312,450 36,410 295,390 33,500 91,980 960,500 525,830 San Francisco. 156,500 30,200 2,656,490 383,415 163,000 31,370 32,595 67,955 12, 700 184,485 69,245 50,450 Total 11,941,700 4,219,425 25,374,715 30,324,987 14,515,907 8,010,485 2,528,325 4,999,655 2,070,6 6,392,235 4,654,345 6,117,975 ft t/2 w o Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

343 Chicago. St. Louis. Minneapolis. Kansas City. Dallas. San Francisco. Total. Received.Returned.Received.Returned. Received. Returned. Received. Returned. Received. Returned. Received. Returned. Received. Returned. ° Boston..... $232,500 $347,800 $53,450 $100,900 $15,000 $142,200 $8,815 $126,600 $283,695 $141,400 $31,360 $156,500 $4,278,835 $12,012,900 J^ New York 3,425,000 1,698,920 922,200 661,150 390,500 792,325 127,750 929,160 599,420 964,265 393,580 2,560,440 29,997,052 24,799,975 Q° Philadelphia 357,500 419,000 90,600 113,000 17,000 12^,000 11,600 129,000 314,450 101,000 31,575 163,000 8,066,790 14,960,902 Cleveland 1,178,650 418,040 226,705 183,020 51,500 116,030 25,000 66,740 299,640 39,410 69,545 36,840 5,175,740 2,534,070 b Richmond 312,000 128,610 122,080 34,250 17,000 44,390 18,990 34,240 89,330 33,750 185,015 14,200 6,450,175 2,083,430 Atlanta.... 747,500 223,550 820,630 424,450 29,000 95,900 68,950 217,550 521,830 950,600 50,990 66,850 6,210,710 4,650,150 o Chicago 1,050,350 1,205,000 219,500 3,418,000 142,150 2,776,500 128,835 974,000 301,010 875,000 5,129,265 15,268,500 St. Louis 1,135,000 1,050,350 54,500 328,300 211,150 2,298,500 373,720 1,961,500 58,170 148,950 3,344,960 7,979,770 w Minneapolis 3,418,000 219,500 328,300 54,500 133,400 224,500 66,250 58,000 266,140 272,000 5,537,985 1,351,000 H Kansas City 2,652,500 145,550 2,298,000 211,150 215,000 133,400 754,820 310,950 319,635 56,100 7,783,185 1,118,755 O Dallas .. 921,000 129,335 1,961,500 373,720 58,000 66,250 310,950 754,820 226,605 106,560 5,765,280 3,506,950 San Francisco 700,000 225,460 148,950 57,540 260,000 249,295 52,100 337,765 104,060 225,145 4,355,640 1,843,080 Total 15,079,650 5,006,115 8,022,765 3,418,680 1,327,000 5,508,090 1,110,855 7,895,375 3,536,050 5,760,020 1,933,625 4,456,440 92,095,617 92,109,482 w w w. o en CO Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Exhibit C—STATEMENTS OF CONDITION OF FEDERAL RESERVE BANKS. Combined resources and liabilities of all Federal Reserve Banks as at close of business on the last Friday of each month during calendar year 1917. RESOURCES. [In thousands of dollars; i. e., OOCTs omitted.] Jan. 26. Feb. 23. Mar. 30. Apr. 27. May 25 June 29. July 27. Aug. 31. Sept. 28. Oct. 26. Nov. 30. Dec. 28. Gold coin and certificates in vault.. 302,341 281,355 | 374,903 311,798 334,265 484,126 460,704 416,797 445,597 461,113 499,887 499,917 Gold settlement fund 213,771 213,861 200,061 207,920 183,590 345,845 405,739 383,937 342,337 363,967 395^,236 317,520 © Gold with foreign agencies 52,500 52,500 52,500 52,500 52,500 52,500 52,500 H Total gold held by banks 516,112 495,216 574,964 519,718 517,855 882,471 919,003 853,234 840,434 877,580 947,623 869,937 O Gold wjjth Federal Reserve agents.. 273,320 306,186 360,668 422,905 456,611 402,639 434,193 493,185 558,227 614,692 661,824 781,S51. Gold redemption fund 1,813 1,922 2,414 2,518 2,905 9,402 9,067 7,079 9,809 11,164 12,278 19,345 Total gold reserve 791,245 803,324 938,046 945,141 977,371 1,294,512 1,302,263 1,353,498 1,408,470 1,503,436 1,621,725 1,671,133 Legal-tender notes, silver, etc. 17,579 15,249 9,282 30,340 36,892 39,840 51,789 52,010 49,089 49,506 54,486 49,635 Total reserves. 808,824 8,573 947,328 G75,481 1,014,263 1,334,352 1,414,052 1,406,108 1,457,559 1,552,942 1,676,211 1,720,768 Bills discounted—members and Federal Reserve banks1 15,711 20,266 20,106 35,043 47,587 197,242 138,459 147,315 233,539 397,094 756,398 680,706 Bills bought in open marketl 97,697 123,966 84,473 71,400 107,377 202,270 195,097 154,591 176,169 177,590 205,454 275,366 Loans on gold coin and bullion 21,850 United States Government long-term securities 36,122 29,471 29,275 36,223 36,513 36,426 41,135 45,406 55,129 54,166 47,304 48,350 United States Government short-term securities 19,617 18,647 18,425 81,595 81,145 34,302 35,818 32,521 39,876 55,876 41,792 58,883 td Municipal warrants , 12,249 17,124 15,715 14,999 14,675 2,446 1,469 1,230 224 233 1,429 1,005 o Total earning assets 181,426 209,474 167,994 239,260 287,297 494,536 411,978 381,003 504,937 684,959 ,052,377 1,064,310 from other Federal Reserve banks—net.. 2^4,123 732 2,275 132 10,641 1,448 -11,106 10,233 5,929 6,890 2-7,091 11,976 Uncollected items 126,437 136,940 132,759 204,842 328,779 221,705 204,756 260,184 234,361 281,677 373,160 301,067 Total deductions from gross deposits 122,314 137,672 135,034 204,974 339,420 223,153 193,650 270,417 240,290 288,573 366,069 313,043 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

5 per cent redemption fundagainst Federal Reserve bank notes 400 400 400 400 400 500 500 500 500 537 537 537 All other resources 13,609 8,271 5,393 5,757 6,424 799 1,057 293 387 1,354 2,499 2,813 Total resources 1,126,573 1,174,390 1,256,149 1,425,872 1,647,804 2,053,340 2,021,237 2,058,381 2,203,673 2,528,365 3,097,693 3,101,471 LIABILITIES. Capital paid in 55,694 •55,989 56,075 56,409 56,991 57,176 57,825 58,904 59,379 62,629 68,500 70,442 Government deposits 25,607 13,407 20,567 99,689 76,114 300,966 143,032 154,358 71,289 132,221 220,962 108,213 Due to members—reserve account 687,841 692,475 720,411 719,785 813,326 1,033,460 1,135,456 1,069,804 1,136,930 1,264,323 1,489,370 1,453,166 Collection items 97,374 108,826 100,961 129,032 170,151 149,527 137,815 140,278 157,524 174,492 231,776 191,689 Other deposits, including foreign Government credits. 76,000 1,000 9,547 39,903 68,433 36,335 19,473 17,969 Total gross deposits 810,822 814,708 841,939 948,506 1,135,591 1,484,053 1,425,850 1,404,343 1,434,176 1,607,371 1,961,581 1,771,037 Federal Reserve notes in actual circulation 259,768 303,171 357,610 420,509 454,402 508,753 534,015 587,915 700,212 847,506 1,056,983 1,246,488 Federal Reserve bank notes in circulation—net liability 934 2,459 6,023 8,000 8,000 8,000 8,000 All other liabilities 289 522 525 448 820 1,524 1,088 1,195 1,908 2,859 2,629 5,504 Total liabilities 11,126,573 1,174,390 1,256,149 1,425,872 1,647,804 2,053,340 2,021,237 2,058,381 2,203,673 2,528,365 3,097,693 3,101,471 i 2 MATURITIES OF BILLS ON HAND. Within 15 days 29,402 36,912 31,061 38,021 43,844 172,168 115,223 108,291 178,383 344,190 581,704 395,697 Over 15 but within 30 days.. IS,794 32,925 30,320 20,900 22,370 53,754 44,799 55,508 63,712 51,887 91,556 118,545 Over 30 but within 60 days.. 51,790 49,617 30,636 29,620 50,808 91,213 94,431 89,170 96,234 101,512 140,417 2S0,138 Over 60 but within 90 days.. 12,414 23,915 11,735 16,735 35,145 77,420 73,893 46,124 09,936 75,211 141,927 152,708 Over 90 days 1,008 863 827 1,167 2,797 4,957 5,210 2,813 1,443 1,884 6,248 8,986 Total.. 113,408 144,232 104,579 106,443 154,964 19,512 333,556 301,906 409, 70S 574,684 961,852 956,072 2 Net amounts due to other Federal Reserve Banks. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

62 ANNUAL EEPOET OF THE FEDERAL RESEKVE BOAEB. MOVEMENT OF RESERVES OF ALL FEDERAL RESERVE BANKS DURING THE CALENDAR YEAR 13(7, (N MILLIONS OF DOLLARS. Carvel: J8CLTIXS Gold Settlement fund. Curve2. > Jotal Cold held with t?ie 3\ft. $oard. inrt. Amounts standing to the credit of331 Joents. Carve J; JotaZ6oldSteserveagainstZtefwsits,nlu$ooulheid witfi tMjytJfoamto the credit cfJTJt. Agents. Curve S: JctaLfi&e-rpes.mjct. Silver, tf&Jfotes,etc. | —i—• _, tPOO 1 | «» 1600 ,_| 1 1 1500 > 1500 mo M— > wo M BOO —1 \ ~1 i ft—— / 1300 j J/ | -/ eoo ) 1 D / / JiOO | noo i#. > s IICO — — wo I 1 | 1000 1—' -4 -H 800 1 900 i 1 Isoo #00 , > / i ! . ZtO 1 700 i 1 wo -1-r- s 600 —_i— '—'—'—^~P* T so? ' f , ( 500 -4- 400 J z-f J/' Ck—I V 400 •r 300 kj 300 soo - M zoo too — \ r roo — H 0 —-f Hft IInh *<> cTg7 i r1 * r? $4^-; ) i Sr h w 0 JANUARY \ttBRUW M4HCH APRIL i MAY JLriE Jt'Z.K I AU6U5T WBT7Mm\ 0CVC6EP \NGW*Br*\D&:5MBER Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

ANNUAL EEPOET OF THE FEDEKAL KESEKVE BOAED. 63 MOVEMENTOFEARtimGASSETSOFALLFEDERALRESERVE BANKS DURING THE CALENDER YEAR 131?, IN MILLIONS OF DOLLARS. Curve / .• Member JSanKs 'Collateral J&fcs. Curve 2.- Total 3C3oouutts. Curve 31 Jotai JSULs JfeUi,ind. Cp4K?{ar?ec£jfaxte0». Curve4-.- JSiOs jtlus U.S. Jhnds. Curves. JtiUsnlus all US. Securities. \ , CUrvc&; JBiffl^!xrn^M^xeC?,ihcla4iui^JKtuuc^uU7i&rTVUits> HOC 1100 s /j\ 1000 1000 'rw r/k\T/ i3—• n 1 900 1 11J. 900 l\ f i\ 1 M \vt soo [/ If/I 800 H W n if\ A4JI Ifntu\ no 71 / ' VO in / //r fr±\ 600 600 \X \ \£ [ / ill/ / v / \ M/TT" SCO I \ \ 1 / j A!/1 A SOO L h /\ T \f\ \\ 11 t \ \\\L / h Ja 400 \ \i I i t/ Iv \\ r / \ V bIff" 1 400 it V s\ /s/ / j \ ill \ /\ j \ M s / i 300 f 1 \ \ \ s A h \ \ 300 11 \ / yl j 2O0 s S , ,N / / 35 ' 1 ( / / f 1 f \' /• Y 1 / i 1 j — 200 •/ > b A \ A -4 100 •/ -}fr I i —' 100 u-L1 / N s >Tr f± o o s & 9 i shr ft mat 5 / 6? !S c\y 101, ' A 12 3S>7/42/a JANUARY \mHUARA MARCH ! APRIL ~ MAY ij^UtW^ ./£/£/ 1 AU6UST \S£PT£MXH\ OCTOBER \^0ifM3£R\PEC£MBm\ Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Principal resources and liabilities of all Federal Reserve Banks at close of business on each Friday, Jan. 7 to Dec. 28, 1917. [In thousands of dollars; i. e., 000's omitted.] c G i e n r o t a l i v f d n a i c d c u a o l t t i e . n s set f t G u le o n m l d d . ent G a f g o o e l r d n e c i w g ie n i s th . G R F a o g e e ld s e d e n e w r t r v s a i . e t l h red f e G u m n ol d p d . tion T r o es ta e l r v g e o s l . d T s i r n i o t e l e c v s l t n l e a e e u g d l r r d v , a e c i e e l r a n s s t s g c , , h . d f b i R o F s b e c r e B e a r o d s s m n i u e e l k a l e r n r s n s v m a t . d e e l - d b m ou o B a p g r i e l k h l n e t s t i . n s lo e G U S n c m o g u n t v a e - r i t t e i t n e e t e r i t r n s d e m - s. s s h e G U o S c m o r u n t t v a e r i - e i t t t n t e e e r i t n d s e rm - s. Jan.5... 267,169 192,00?. 281,292 1,600 742,062 758,242 26,217 121,807 41,052 14,857 Jan.12.. 292,829 206,541 274,512 1,782 775,664 792,433 24,355 115,979 41,106 14,857 Jan.19.. 286,509 212,051 273,141 1,783 773,484 783,822 17,219 108,447 37,899 18,314 Jan.26.. 302,341 213,771 273,320 1,813 791,245 808,824 15,711 97,697 36,122 19,647 Feb. 2... 306,964 212,961 274,074 1,835 795,834 808,019 14,707 93,112 30,550 18,647 Feb. 9... 274,194 212,961 288,720 1,734 777,609 788,242 16,200 112,092 29.470 18,647 Feb. 16.. 274,367 216,221 297,270 1,804 789,662 797,271 19,553 126,054 29,471 18,647 Feb. 23.. 281,355 213,861 306,186 1,922 803,324 818,573 20,266 123,966 29.471 18,647 Mar. 2... 304,163 212,031 317,581 2,347 836,122 846,093 18,840 114,058 28,650 19,468 Mar. 9... 330,184 205,561 328,433 2,325 866,503 885,616 18,500 108,860 29,126 19,468 Mar. 16.. 355,318 201,661 338,608 2,339 897,920 914,102 17,234 97,002 29,155 19,3G8 Mar. 23.. 350,736 209,281 349,519 2,519 912,055 922,720 18,473 87,798 29,275 18,818 Mar. 30.. 374,903 200,061 360,668 2,414 938,040 947,328 20,106 84,473 29,275 18,425 Apr. 6... 362,472 200,125 378,450 2,505 943,552 902,062 17,928 82,735 30,629 23,042 Apr. 13.. 338,369 198,271 410,796 2,434 949,870 971,006 22,009 80,004 36,218 23,370 Apr. 20.. 330,152 20G, 830 418,538 2,651 958,171 982,633 29,737 72,925 36,215 23,360 Apr. 27.. 311,798 207,920 422,905 2,518 945,141 975,481 35,043 71,400 36,223 23,450 May 4... 336,138 218,910 433,089 2,669 990,786 1,030,201 35,916 83,871 36,222 23,450 May 11.. 336.841 221,759 438,323 2,687 999,610 1,035,759 39,534 97,155 36,222 23,450 May 18.. 350,269 187,969 448,311 2,754 989,303 1,016,745 44,846 100,177 36,3SC 23,33S May 25.. 334,265 183,590 456,611 2,905 977,371 1,014,263 47,587 107,377 36,513 23,338 June 1... 299,225 187,556 466,969 3,053 956,803 993,427 50,854 110,100 36,387 23,338 June 8.. 330,001 205,886 475,201 2,730 1,013,818 1,051,511 98,021 135,270 36,387 23,338 June 15. 365,020 221,970 459,942 3,958 1,050,890 1,075,408 202,824 .164,525 36,400 23,344 June 22. 492.842 267,910 52,500 390,765 8,001 1,212,018 1,247,698 240,981 194,303 36,427 78,491 June 29. 484,126 345,845 52,500 402,639 9,402 1,294,512 1,334,352 197,242 202,270 36,426 34,302 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

c G i e n r o t a l i v d f n a i c d c u a o l t t i e . n s| set f G t u le n o m l d d . ent G a f g o o e l r d n e c i w g ie n i s th . G R F o e e ld s d e e w r r v a i e l th red f e G u m o n l d p d . tion T r o es ta e l r v g e o s l . d s T i r i n t o e l e c v s t l n l a e e e u d l g r r d , e v a c i r e l e a n s t s s , g c , h . d f i b R o F s b e r c e e B a r o s d s m n i u e l e k a l e r n r s n s v m a t . d e e l - d b m ou o B a p g r il e k h l n t s e t i . n s lo e G U S n c m o u g n t v a e r - i e i t t t n t e e e r i t s n r d e m - s. s s h e G U o S c m o r u n t t v a e r i - t e i t n t e t e e r i t s n d e rm - s. July 6.. 470, 371. 52,500 413,715 9,748 1,317,703 1,356,017 129,853 201,664 42,935 28,659 July 13. 471 388, 52,500 428,338 12,687 1,353,371 1,400,916 140,163 194,937 43,961 30,359 July 20. 488, 403, 52,500 423,889 11,691 1,380,020 1,430,321 161,386 197,725 42,265 33,050 July 27. 460, 405, 52,500 434,193 9,067 1,362,263 1,414,052 138,459 195,097 41,135 35,818 oj w Aug. 3. 399, 438, 52,500 467,845 9,390 1,367,673 1,421,382 130,948 174,183 42,422 25,464 H Aug. 10. 413, 409, 52,500 485,467 9,274 1,370,942 1,424,059 134,229 149,790 41,276 32,604 o Aug. 17. 399, 410, 52,500 502,588 9,795 1,374,583 1,427,489 143,946 155,329 45,129 30,552 Aug. 24. 426, 397, 52,500 488,536 7,375 1,372,219 1,424,769 128,407 159,557 45,226 30,480 Aug. 31. 416, 383, 52,500 493,185 7,079 1,353,498 1,406,108 147,315 154,591 45,406 32,521 Sept. 7. 414, 395, 52,500 494,779 7,218 1,364,783 1,415,391 168,217 173,199 45,394 42,441 Sept. 14 408, 384, 52,500 520,470 9,127 1,374,949 1,426,034 167,333 168,445 45,358 42,366 Sept. 21 430, 373, 52,500 536,009 9,442 1,402,317 1,452,251 183,758 161,012 53,929 41,070 Sept. 28 445, 342, 52,500 558,227 9,809 1,408,470 1,457,821 233,539 176,169 55,129 39,870 Oct. 5.. 481, 334 52,500 560, 111 9,465 1,438,477 1,486,715 265,251 186,162 55,727 73,632 Oct. 12. 482, 321, 52,500 580,734 9,717 1,447,445 1,495,558 293,164 185,775 54,878 48,517 Oct. 19. 419, 369, 52,500 618,827 11,218 1,471,539 1,520,512 286,615 171,611 55,088 47,255 Oct. 26. 461, 363, 52,500 614,692 11,164 1,503,436 1,552,942 397,094 177,590 54,166 55,876 Nov. 2.. 501, 378, 52,500 602,433 11,317 1,546,075 1,596,819 503,965 186,012 53,851 45,211 Nov. 9.. 507, 385, 52,500 616,254 11,496 1,573,377 1,625,585 510,154 181,001 53,743 42,367 Nov. 16. 526, 363, 52,500 629,906 11,420 1,584,328 1,636,853 487,850 193,869 54,002 187,904 fej Nov. 23. 530, 386, 52,500 623,948 11.549 1,604,704 1,658,762 650,002 209,905 53,962 57,850 w Nov. 30. 499, 395, 52,500 061,824 12,278 1,621,725 1,676,211 756,398 205,454 47,304 41,792 ow Dec. 7.. 500, 376, 52,500 683,939 17,485 1,631,358 1,683,307 686,G02 190,682 49,198 50,424 to Dec. 14. 502, 393, 52,500 683,378 17,710 1,650,238 1,700,384 713,431 254,428 53,774 48,016 Dec. 21. 524, 304, 52,500 746,107 17,982 1,645,543 1,093,670 693,509 277,943 50,438 58,130 Dec. 28. 499, 317 52,500 781,851 19,345 1,071,133 1,720,768 (ISO, 706 275,366 48,350 58,883 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Principal resources and liabilities of all Federal Reserve Banks at close of business on each Friday, Jan. 7 to Dec. 28, 1917—Continued. [In thousands of dollars; i. e., 000's omitted.] Other se U S c T u n t o a r i t i t t a t e e i l d s es. M wa u r n r i a c n ip ts a . l e a T a s r o s n t e i a n t l s g . Un i c t o em lle s e . ted l r i e a T s b a o i o n u l t i d r a t c i l e e s s . C pa a i p d i i ta n l . d G e m o p v o e e s n r i t n ts - . m a r e D c e m u c s e o e b r u v e t n o e r t s . - Co it l e le m ct s i . on i d n G f e c o m o p l r v u e e o e d i n s g r i t i n n n ts - g , ci n R F r a c o e e c u t d s t e l e u e a s r a r t v i a i l n o e l n. B in l a t R F i i n a o c e e k b i n d s r i e , e c n l r i n u r o t v a e l y t e a l e t . - s 4 credits. > Jan. 5... 55,909 8,736 212,669 142,629 1,129,358 55,695 25,566 656,422 118,559 272,873 Jan. 12.. 55,963 9,859 206,156 120,846 1,143,728 55,706 27,759 680,586 111,238 268,168 Jan.19.. 56,213 10,596 192,475 132,416 1,126,896 55,642 28,410 669,874 109,734 262,967 o w Jan.26.. 55,769 12,249 181,426 126,437 1,126,573 55,694 25,607 687,841 97,374 259,768 H Feb. 2... 49,197 12,664 169,680 126,611 1,130,550 55,725 23,333 689,878 101,232 260,030 o Feb. 9... 48,117 14,833 191,242 121,225 1,125,442 55,713 15,525 678,170 97,207 278,523 Feb. 16.. 48,118 16,678 210.403 144,249 1,168,782 55,773 10,851 688,591 121,218 291,839 H Feb. 23.. 48,118 17,124 209,474 136,940 1,174,390 55,989 13,407 692,475 108,826 303,171 W Mar. 2... 48,118 16,798 197,814 154,026 1,210,177 56,045 14,162 708,893 116,330 314,258 Mar. 9... 48,594 16,932 192,886 130,411 1,218,857 56,028 12,401 720,488 102,824 328,433 Mar. 16.. 48,523 16,029 178,788 155,976 1,258,843 56,054 18,594 726,104 121,550 336,061 Mar. 23.. 48,093 15,761 170,125 145,757 1,247,980 56,057 19,702 711,117 113,784 346,804 Mar. 30.. 47,700 15,715 167,994 132,759 1,256,151 56,075 20,567 720,411 100,961 357,610 r Apr. 6... 59,671 15,207 225,541 146,422 1,343,346 56,100 46,461 758,219 105,436 376,510 w Apr. 13.. 59,588 15,212 227,413 169,184 1,373,684 56,408 42,247 741,542 131,064 401,809 Apr. 20.. 59,575 15,163 227,400 166,966 1,384,642 56,411 41,988 742,584 128,856 414,357 Apr.-27.. 59,673 14,999 239,260 204,842 1,425,872 56,409 99,689 719,785 129,032 420,509 May 4.. 59,672 14,755 258,811 184,639 1,484,706 56,859 107,868 743,143 122,761 25,000 428,502 May 11.. 59,672 14,688 269,138 310,685 1,623,405 56,859 242,421 740,726 134,447 10,000 438,218 o May 18., 59.724 14,639 274,052 192,830 1,577,526 56,868 187,127 748,499 136,750 1,000 448,311 > May 25. 59,851 14,675 287,297 328,779 1,647,804 56,991 76,114 813,326 170,151 1,000 454,402 Junel... 59.725 13,912 294,748 177,092 1,475,400 56,985 96,478 721,146 134,091 1,000 464,865 June 8... 59,725 5,524 358,500 304,730 1,725,540 57,000 228,125 775,771 181,321 1,000 481,469 June 15. 59,744 2,470 483,947 290,320 1,860,934 57,171 262,581 870,734 176,424 1,000 491,615 June 22., 114,918 2,444 552,649 195,826 1,999,642 57,171 495,807 806,209 137,581 1,000 499,721 776 June 29. 70,728 2,446 494,536 221,705 2,053,340 57,176 300,966 1,033,460 149,527 1,000 508,753 934 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Other se U S c T u n t o a r i t i t t a t e e i l s d es. M wa u r n r i a c n ip ts a . l e a T a s r o s n e t i a t n s l g . Un i c t o e l m le s c . ted l r i e a s T b a o i o n l u t i d r a t c i l e e s s . p C a a i p d it i a n l . d G e m o p v o e e s n r i t n ts - . m a e r D c e m c s u o b e e u r e v t n r o e s t , — i ! | Co it l e le m ct s i , on i d n G f e c o m o p l r u v o e e e d i s n g r i i t n n t n s - g , ci R n F r a c o e e c u t d s t e l e u e a s r r a t v i a i l n o e l n, B i t n a R F i n o c e e k n i d s r , e e c n r r n u o v a l e t e l a e t - s liability. credits. July 6... 71,594 2,442 405,553 251,334 2,033,760 57,657 143,626 1,112,347 164,588 6,000 527,459 1,175 July 13.. 74,320 2,441 411,861 253,722 2,074,790 57,681 300,872 1,019,672 153,363 7,847 532,508 1,960 July 20.. 75,315 2,186 436,612 242,967 2,116,124 57,723 184,631 1,164,995 165,284 5,767 534,226 2,306 July 27.. 76,953 1,469 411,978 204,756 2,021,237 57,825 143,032 1,135,456 137,815 9,547 534,015 2,459 Aug. 3.. 1,249 374,266 197,058 1,998,444 57,881 56,765 1,192,887 132,053 14,269 540,785 2,828 Aug. 10. 73,880 1,274 359,173 205,761 1,988,263 57,970 140,447 1,101,614 122,493 11,274 549,244 4,182 Aug. 17. 75,681 1,223 376,179 230,704 2,048,442 58,093 110,110 1,130,817 171,916 12,637 558,782 4,907 Aug. 24.. 75,706 1,232 364,902 210,387 2,001,140 58,484 59,972 1,121,129 137,955 43,933 573,049 5,473 Aug. 31. 77,927 1,230 381,063 260,184 2,058,381 58,904 154,358 1,069,804 140,278 39,903 587,915 6,023 Sept. 7.. 87,835 204 429,455 216,960 2,074,714 59,256 39,926 1,138,542 154,112 53,339 621,299 6,894 Sept. 14. 87,724 214 423,716 224,622 2,081,734 59,368 21,602 1,139,291 156,268 51,621 644,567 7,561 Sept. 21. 94,999 214 439,983 236,794 2,132,179 59,354 25,030 1,151,704 164,449 51,779 670,246 8,000 Sept. 28. 95,005 224 504,937 234,361 2,203,673 59,379 71,289 1,136,930 157,524 68,433 700,212 8,000 Oct. 5... 129,359 79 580,851 230,423 2,301,633 61,027 86,310 1,148,887 159,258 95,029 740,916 8,000 Oct. 12.. 103,395 101 582,435 321,205 2,417,845 61,104 74,167 1,265,309 173,825 52,377 779,885 8,000 Oct. 19.. 102,343 233 560,802 332,302 2,447,841 61,847 76,365 1,230,557 210,048 43,262 815,210 8,000 Oct. 26.. 110,042 233 6S4,959 281,677 2,528,365 62,629 132,221 1,264,323 174,492 36,335 847,506 8,000 Nov. 2... 99,062 1,267 790,306 317,901 2,721,534 64,291 175,912 1,372,023 191,811 25,310 881,001 8,000 Nov. 9... 96,110 1,273 788,538 271,796 2,697,170 65,345 59,198 1,406,982 187,022 34,866 932,512 8,000 Nov. 16.. 241,906 1,273 924,898 428,544 3,012,406 66,691 218,887 1,480,498 240,437 21,925 972,585 8,000 Nov. 23.. 111,812 17422 979,141 302,525 2,956,130 67,136 196,411 1,426,648 215,169 23,291 1,015,892 8,000 Nov. 30.. 89,096 1,429 1,052,377 373,160 3,104,784 68,500 220,962 1,489,370 231,776 19,473 1,056,983 8,000 Dec. 7... 99,622 914 978,120 310,572 3,001,836 69,048 168,568 1,437,174 189,861 15,586 1,110,537 8,000 Dec. 14.. 101,820 994 1,070,673 319,656 3,125,554 69,440 129,285 1,549,030 196,767 14,282 1,153,385 8,000 Dec. 21.. 108,568 1,102 1,081,122 323,574 3,142,956 69,852 221,761 1,389,434 205,819 14,258 1,227,642 8,000 Dec. 28.. 107,233 1,005 1,064,310 301,067 3,101,471 70,442 108,213 1,453,166 191,689 17,969 1,246,488 8,000 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

68 ANNUAL REPOET OF XlilS FEDERAL RESERVE BOARD. CASH RESERVES AND EXCESS RESERVES OF THE ER. BANKS 1917 Carve /. Cash S^eserves required against Jfet Sep-osic and J^.JYbte liabilities combined. Cbure 2.- Jotal Cash 3teserre$ of Che JTJl. 3anKs. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

ANNUAL EEPOET OF THE FEDERAL EESEBVE BOARD. NET DEPOSITS & FRNOTE LIABILITIES, TOTAL RESER VES, AND RA TIO OF TOTAL RESER VES TO A6GRE6ATE NET DEPOSITAHD FR.NOTE LIABILITIES, DURING CALENDAR YEAR 1917. Curve I: JfetZkjtosiia. Currc Z, Oznv J .-Jbtal (hsh fleaervea. .- Jtatio ofJatal Cash J&serves Co Jgcrtqate- JfetZ>c}wsifi4&3lJrGte&at>mie$ Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

70 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. Required reserves against net deposit and Federal Reserve note liabilities and amounts of gold held in excess of required reserves. [In thousands of dollars; i. e., 000's omitted.] Net deposits. Fede in ra c l i R rc e u s l e a r t v io e n n . otes Total Gold in amount of Total cash excess of 1917. Required Required required reserves required Amount. 3 r 5 e s p e e r r v c e e o n f t. Amount. | | 4 r 0 e s p e e r r v c e e o n f t. reserves. held. (f r re e e se g rv o e l s d). Jan. 5 S651, $227,938 $272,873 $109,149 $337,087 $758,242 $421,155 Jan. 12 68' 240,487 268,168 107,267 347,754 792,433 444,679 Jan. 18-19 670, 234,692 262,967 105,187 339,879 783,822 443,943 Jan. 2G 680, 238,092 259,768 103,907 341,999 808,824 466,825 Feb. 2 675, 236,301 260,030 104,012 340,313 808,019 467, 706 Feb. 9 656, 229,748 278,523 111,409 341,157 788,242 447.085 Feb. 16 234,000 291,839 116, 736 350, 736 797,271 446,535 Feb. 23 236,963 303,171 121,268 358,231 818,573 460,342 Mar. 2 681, 238,468 314,258 125,703 364,171 846,093 481,922 Mar. 9 702, 245,756 326,612 130,645 376,401 885,616 509,215 Mar. 16 708, 247,413 336,061 134,424 381,837 914,102 532,265 Mar. 23 695, 243,442 346,804 138,722 382,164 922,720 540,556 Mar. 30 7O6: 247,417 357,610 143,044 390,461 947,328 556,867 Apr. 5-6 760, 266,099 376,510 150,604 416,703 962,662 545,959 Apr. 13 744, 260,609 401,809 160,724 421,333 971,606 549,673 Apr. 20 743, 260,396 414,357 165,743 426,139 982,633 556,494 Apr. 27 743, 260,237 420,509 168,204 428,441 975,481 547,040 May4 808, 283,111 428,502 171,401 454, 512 1,030,201 575,689 May 11 815, 285,447 438,218 175,287 460, 734 1,035,759 575,025 May 18 793, 277,560 446,501 178,600 456,160 1,016,745 560,585 May 25 721, 252,409 454,402 181,761 434,170 1,014,263 580,093 Juno 1 771, 270,181 464,865 185,946 456,127 993,427 537, 300 Junes 876, 306,837 481,469 192, 588 499,425 1,051,511 552.086 Juno 15 1,014, 355,171 491,615 196,646 551,817 1,075,408 525,591 June 22 1,242, 434,774 499, 721 199,888 634,662 1,247,698 613,036 June 29 1,261, 441,630 508,753 203,501 645,131 1,334,352 689,221 July 6 1,155, 404,503 527,459 210,984 615,487 1,356,017 740,530 July 13 1,221, 427,359 532,508 213,003 640,362 1,400,916 760,554 July 20 1,273, 445,759 534,226 213,690 659,449 1,430,321 770,872 July 27 1,232, 431,270 534,015 213,606 644,876 1,414,052 769,176 Aug. 3 1.194, 417,960 540,785 216,314 634,274 1,421,382 787,108 Aug. 10 1,171, 410,103 549,244 219,698 629,801 1,424,059 794,258 Aug. 17 1,183, 414,081 558,782 223,513 637,594 1,427,489 789,895 Aug. 24 1.152, 403,326 573,049 229,220 632,546 1,424,769 792,223 Aug. 31 1,133, 396,874 587.915 235,166 632,040 1,406,108 774,068 Sept. 7 1,156, 404,923 621,299 248,520 653,443 1,415,391 761, 948 Sept. 14 1,137, 398,162 644,567 257 827 655,989 1,426,034 770,045 Sept. 21 1.153, 403,872 670,246 268,098 671,970 1,452,251 780,281 Sept. 28 1,193, 417,860 700,212 280,085 697,945 1,457,559 759,614 Oct. 5 1,255, 439,772 740.916 296,366 736,138 1,486, 715 750,577 Oct. 11-12 1, 429,564 779,885 311,954 741,518 1,495,558 754,040 Oct. 19 1.195, 418,387 815,210 326,084 744,471 1,520,512 776,041 Oct. 26 1,318, 461,579 847,506 339,002 800,581 1,552,942 752,361 Nov. 2 1,432, 501,470 881,001 352,400 853,870 1,596,819 742,949 Nov. 9 1,408, 492,991 932,512 373,005 865,996 1,625,585 759,589 D N N D D N e e e o o o c c c v v v . . . . . . 2 7 1 3 2 1 1 4 0 3 6 1 1 1 1 1 1 , , , , , , 4 4 5 5 5 5 3 7 6 1 9 4 8 4 5 5 6 7 , , , , , , 5 5 5 5 5 5 1 1 5 3 3 4 6 3 8 8 0 1 , , , , , , 0 2 3 4 4 3 0 1 7 9 2 7 0 3 8 3 9 5 1 1 1 1 1 , , , , , 0 1 2 1 0 9 1 5 2 5 1 7 0 6 7 3 5 2, , , , , , 5 6 3 8 9 5 3 4 8 9 8 8 7 2 5 2 3 5 4 4 4 3 4 4 4 6 9 9 0 8 4 2 1 1 6 9 8 4 2 , , , , , , , 3 3 0 0 2 5 7 5 5 3 5 1 9 9 7 4 4 7 5 5 3 1 1 , , 0 0 9 9 9 9 9 0 0 8 1 9 6 4 4 8 1 9 9 0 7 , , , , , , , 2 8 8 4 7 2 2 7 9 5 1 2 1 2 0 3 0 2 9 5 2 1 1 1 1 1 1 , , , , , , 6 7 6 6 6 6 8 0 9 3 7 5 3 0 3 6 6 8 , , , , , , 3 3 6 8 7 2 0 8 7 5 6 1 7 4 0 3 2 1 7 6 6 7 7 7 7 8 1 1 9 1 2 0 9 1 7 4 0 3 0 , , , , , , , 4 8 9 4 9 0 6 0 7 1 9 4 8 5 0 5 2 2 1 9 5 Digitized foDr eFcR. 2A8SER 1,457, 510,298 1,240,488 1, 720, 768 http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

ANNUAL, EEPOET OF THE FEDERAL RESERVE BOARD. 71 Commercial paper, exclusive of acceptances bought in open market, held by each Federal Reserve Bank on Dec. 28, 1917, distributed by maturities. MATURITIES. [In thousands of dollars; i. e., 000's omitted.] From From From Feder B al a n R k e . serve 1 W 5 i d t a h y in s. 1 d 6 a t y o s 3 . 0 3 d 1 a t y o s . 60 6 d 1 a t y o s . 90 O d v a e y r s 9 . 0 Total. Per cent. Boston 13,047 7,804 8,862 36,218 65,931 9.7 New York 141,907 10,804 78,859 23,415 254,985 37.5 Philadelphia 20,877 2,877 13,133 2,634 39,521 5.8 Cleveland 23,767 4,573 12,587 3,669 5 44,601 6.6 Richmond 21,232 1,902 5,342 1,619 12 30,107 4.4 Atlanta 10,374 1,932 2,728 1,179 47 16,260 2.4 Chicago 70,316 14,385 12,289 5,346 4,189 106, 525 15.6 St. Louis 21,710 4,681 10,753 2,592 76 39,812 5.8 Minneapolis 2,765 1,140 6,776 1,384 1,426 13,491 2.0 Kansas City 19,904 2,736 8,504 1,628 2,042 34,814 5.1 Dallas 1,665 105 5,774 439 890 8,873 1.3 San Francisco 7,809 4,428 9,399 3,851 299 25,786 3.8 Total 355,373 57,367 175,006 83,974 8,986 680, 706 Percent 52.3 8.4 25.7 12.3 1.3 100.0 Acceptances bought in open market, held by each Federal Reserve Bank on Dec. 28, 1917, distributed by maturities. MATURITIES. [In thousands of dollars; i. e., 000's omitted.] From From From Feder B al a n R k e . serve 1 W 5 i d th ay in s. 1 d 6 a t y o s 3 . 0 3 d 1 a t y o s . 60 6 d 1 a t y o s . 90 O d v a e y r s 9 . 0 Total. Per cent. Boston 981 1,204 715 5,441 8,341 3.0 New York 13,631 22,043 67,700 44,751 148,125 53.8 Philadelphia 2,135 6,823 5,019 4,440 18,417 6.7 Cleveland 5,177 6,812 7,126 2,911 22,026 8.0 Richmond...". 2,534 4,494 4,113 1,897 13,038 4.7 Atlanta 1,370 703 3,868 994 6,935 2.5 Chicago 1,493 1, 649 1,227 4, 293 8,662 3.2 St. Louis 819 1,809 3,076 1,676 7,380 2.7 Minneapolis 2,284 3,129 2,037 349 7,799 2.8 Kansas City 1,406 9 10 1,425 0.5 Dallas . . . 1,233 6,947 6,185 3 14,368 5.2 San Francisco 7,258 5,555 4,056 1,981 1 18, 850 6.9 Total 40,321 61,177 105,132 68, 736 275,366 Percent 14.6 22.2 38.2 25.0 100.0 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

72 ANXUAL REPORT OF THE FEDERAL RESERVE BOARD. Short-term investments (municipal warrants) held by each Federal Reserve Bank on Dec. 28, 1917, distributed by maturities. MATURITIES. [In thousands of dollars; i. e., 000rs omitted.] From From From Feder B al a n R k e . serve 1 W 5 i d th ay in s. 16 d a to y s 3 . 0 31 d a to y s 6 . 0 61 d a to y s 9 . 0 O d v a e y r s 9 . 0 Total. Per cent. Boston NGW York 511 511 50.9 Philadelphia 10 10 1.0 Cleveland... 7 7 0.7 Richmond . Atlanta 28 10 141 123 302 30.0 Chica ^o St Louis Minneapolis 25 25 2.5 Kansas Citv - Dallas 46 101 150 14.9 San Francisco Total 115 10 652 123 104 1,005 Per cent 11.6 1.0 64.9 12.2 10.3 100.0 United States securities held by each Federal Reserve Bank on Dec. 31, 1917, distributed by classes and maturities. Federal Reserve Bank. 2 c o p n 1 e s 9 r o 3 0 l c s . e o n f t P 2 1 a 9 p n 3 e a 6 r m - 1 c 9 a e 3 s n 3 o t . f 3 l p o 1 e a 9 r n 1 8 c o . e f nt 3 l p o 1 e a 9 r n 6 1 c o . e f nt c 3 o b 1 p n o 9 e v n 4 r e 6 d r - s c s 4 e o i 7 o n f . n t 3 p n 1 e o - r y t e e c a s e r . nt Boston $750 S529,000 19 i, 000 New York 50 $50,000 1,255, 500 493,000 Philadelphia... $100 549, 200 548,000 Cleveland 6,400 467,200 2,653, 660 414, 800 221,000 Richmond 915,100 237,000 969,000 Atlanta 640, 600 21,000 10,300 491,000 Chicago 1,862,500 367,300 2,581,000 $400 427, 400 378,000 St. Louis 100 1,0S0, 000 1,153,300 444,000 Minneapolis... 323,050 16,2G0 1,199,180 500 114,800 340,000 Kansas City.-.. 7,155,850 22,240 838, 500 784,000 Dallas 2,450,900 281,500 1,233,600 430,000 San Francisco. 2,428, 750 500,000 Total... 15, 784,050 1,412,600 7, 563,840 900 j 6,526,400 26, 792,000 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. 73 United States securities held by each Federal Reserve Bank on Dec. 31, 1917, distributed by classes and maturities—Continued. Federal .Reserve Bank. 3* L p ib er e r c t e y nt 4 L p i e b r e c rt e y nt 4 l p o e a r n c o e f nt T b o o t n al d s U a . n S d . t U if . i c S a . t e c s e r o - f Total U.S. loan of 1947. loan of 1925. notes. indebted- securities. 1942-47. ness. Boston $80,000 1 $118,992 $2 99<? 742 1 $2,922,742 New York 411,150 3,470,150 9,079, 850 $15,000,000 24, G79, 850 Philadelphia 249, 850 6,302, 800 9,649, 950 9,649,950 Cleveland 2, 027,000 320, 750 $2,378,200 11,489,010 28,050,000 39,539,010 Richmond 42,900 41,450 3 205 450 3,205,4,50 Atlanta - 290,900 1,434,200 3,888 000 3, Sm, 000 Chicago 1,708,000 10,384, GOO 10,384,GOO St. Louis 3,077, 400 3, 077, -100 Minneapolis 27,950 200,250 3,227,990 500 3, 228,490 Kansas Citv 7 500 825,000 10,633, 090 10,033,090 Dallas 477,100 53,000 5,92G, 100 5,920,100 San Francisco 20, 250 3,955, 000 3,955,000 Total 3,61? 650 11,769,292 5,177,450 78,039,182 43,050.500 121,089,632 1 Includes unpaid portion of 4 per cent Liberty loan bonds sold to individual subscribers. Amount of United States bonds with circulation Amount of United securities without privilege: circulation privilege: 2 per cent consols and panamas $17,196,650 3 per cent loan of 1961 $900 3 per cent loan of 1918 7,563,480 3 per cent conversion 6,526,40) 4 per cent loan of 1925 5,177,450 3 per cent 1-year notes 26,792,000 3£ per cent Liberty loan 3,012,650 Total. 29,937,940 4 per cent Liberty loan 11,769,292 U. S. certificates of indebtedness... 43,050,500 Total. 91,751,742 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Statement showing condition of each Federal Reserve Bank and of the system on Dec. 31, 1917. RESOURCES. [Detailed figures shown for each bank in first column represent items as reported to the board; figures in second column, printed in italics, indicate results of consolidation according to methods used in the compilation of the board's weekly statement.] Boston. New York. Philadelphia. Oold. bullion and United States coin $2,749,900.00 $68,178,991.99 $147.50 Ciiiteu States gold certificates (including clearing-house certificates) 15,941,000.00 256,952,580.00 19,064,520.00 Gold ZoitK CTid certificates in vault $18,691,000.00 $325,132,000.00 $19,064,000.00 j o Gold settlement fund, Federal Reserve Board 16,977,000.00 16,977,000.00 5,854,000.00 5,854,000.00 32,101,000.00 32,101,000.00 w Gold with foreign agencies 3,675,000.00 5,675,000.00 18,112,500.00 18,112,000.00 3,675,000.00 3,675,000.00 H Total gold held by hanks 39,343,000.00 349,098,000.00 54,840,000.00 O H Gold with Federal Reserve agents 40,896,820.00 40,897,000.00 250,598,565.00 250,599,000.00 63,945,755.00 63,946,000.00 K Gold redemption fund with United States Treasurer 2,000,000.00 2,000,000.00 10,000,000.00 10,000,000.00 1,500,000.00 1,500,000.00 Total gold reserves 82,240,000.00 609,697,000.00 120,286,000.00 d Legal tender notes (including clearing-house certificates) 988,536.00 31,322,275.00 671,100.00 w Silver certificates (including clearing-house certificates) 2,574,800.00 8,925,531.00 518,262.00 r Silver coin . . 11,230.00 212.85 634.10 Legal tender notes, silver, etc 3,574,000.00 40,248,000.00 1,190,000.00 w Total reserves 85,814,000.00 649,945,000.00 121,476,000.00 Member banks' collateral notes 7,349,338 00 111,248,943.00 4,008,400.00 All other bills discounted 58,533,021.35 139,060,003.96 31,903,836.94 w o Bills discounted for members and Federal Reserve Banks 65,882,000.00 250,309,000.00 35,912,000.00 > Bills bought in open market 9,037,506.04 9,038,000.00 148, 770,185.44 148,770,000.00 18,390,067.91 18,390,000.00 o Total bills on hand 74,920,000.00 399,079,000.00 54,302,000.00 United States bonds to secure circulation Other United States bonds owned 1728,742.41 15,168,599.64 7,101,950.00 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

United States Government long-term securities 728,000.00 5,169,000.00 7,102,000.00 One-year Treasury notes 2,194,000.00 4,493,000.00 2,548,000.00 United States certificates of indebtedness 15,000,000.00 CO United States Government short-term securities 2,194,000.00 19,493,000.00 ;ooo.oo & Municipal warrants 510,701.32 10,000.00 ° All other earning assets 511,000.00 10,000.00 Total earning assets. 77,842,000.00 424,252,000.00 63,962,000.00 Exchanges for clearing house 2,300,431.57 7,309,335.13 2,980,995.71 Checks and other cash items 916,166.13 19,120,325.61 4,397,568.98 National bank notes and notes of other Federal Reserve Banks 92,000.00 964,450.00 1,353,500.00 O Mutilated currency (other than own Federal Reserve notes) forwarded for redemption 469,400.00 476,535.00 56,000.00 H Check lost in transit 58.00 O Collection items—Debits: Federal Reserve Banks—Transfers bought 570,000.00 Federal Reserve Banks—Other items 4,006,463.76 29,982,193.73 19,767,938.39 Member and nonmember banks and bankers 10,430,919.68 18,109,596.47 7,144,756.58 Uncollected items 18,786,000.00 75,962,000.00 35,701,000.00 Total deductions from gross deposits 18,786,000.00 75,962,000.00 '5,701,000.00 Total resources 182,442,000.00 1,150,159,000.00 221,139,000.00 Cleveland. Richmond. Atlanta. Gold bullion and United States coin S3,365,975.00 $573,457.50 SI, 548,322.72 United States gold certificates (including clearing-house certificates) 25,787,300.00 5,728,000.00 4,169,000.00 W O Gold coin and certificates in vault $29,153,000.00 $6,302,000.00 $5,717,000.00 Gold settlement fund, Federal Reserve Board 37,664,000.00 37,664,000,00 22,116,200.00 22,116,000.00 12,482,000.00 12,482,000.00 y Gold with foreign agencies 4,725,000.00 4,725,000.00 1,837,500.00 1,837,000.00 1,575,000.00 1,575,000.00 Total gold held by banks. 71,542,000.00 30,255,000.00 19,774,000.00 1 Including unpaid portion of bonds sold to individual subscribers. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Statement showing condition of each Federal Reserve Bank and of the system on Dec. 31, 1917—Continued. OS RESOURCES—Continued. [Detailed figures shown for each bank in first column represent items as reported to the Board; figures in second column, printed in italics, indicate results of consolidation according to methods used in the compilation of the Board's weekly statement.] Cleveland. Richmond. Atlanta. Gold with Federal Reserve agents $55, 369, 700.00 $55,370,000.00 $31, 601,850.00 $31,602,000.00 $50,701,320.00 $50,701,000.00 Gold redemption fund with United States Treasurer 98, 800.00 99,000.00 485,087.15 485,000.00 1,119,140.98 1,119,000.00 Total gold reserves 127,011,000.00 62,342,000.00 71,594,000.00 Lesal tender notes (including clearing-house certificates} 188, 897.00 112,500.00 13,200.00 o w Silver certificates (including clearin£r-hou°e certificates') 49, 472.00 51,748.00 397,889.00 HI Silver c o i n . .. . 171.85 16.85 4,626.00 Legal tender notes, silver, etc 238,000.00 164,000.00 416,000.00 Total reserves 127,249,000.00 62,506,000.00 72,010,000.00 Member banks' collateral notes 150.00 4, 171,060.00 2,628,250.00 All other bills discounted V 1f.S027.27 25, 393,314.34 11,895,589.16 Hills discounted for members and Federal Reserve Banks 42,896,000.00 29,565,000.00 14,524,000.00 Bills bought in open market 21, 111, 990.95 21,112,000.00 13, 156,126.71 13,156,000.00 6,497,061.67 6,497,000.00 Total bills on hand 64,008,000.00 42,721,000.00 21,021,000.00 Other United States bonds owned .. 8,268, 010.00 1, 236,450.00 2,397,000.00 8,268,000.00 1,237,000.00 2,897,000.00 One-year Treasury notes x 3, 221, 000.00 1, 969,000.00 1,491,000.00 w United Statss certificates of indebtedness 28, 050, 000.00 o United States Government short-term securities 31,271,000.00 1,969,000.00 1,491,000.00 Municipal warrants 7, 233.38 284,372.00 92,344.97 503,831.60 All other earning assets 7,000.00 92,000.00 788,000.00 Total earnina assets 103,554,000.00 46,019,000.00 25,697,000.00 9 ! Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Due from other Federal Reserve Banks—Collected funds 11,206,205.39 2,477,038.78 Due to other Federal Reserve Banks—Collected funds 1,275,547.12 Due from other Federal Reserve Banks—Net 11,206,000.00 1,202,000.00 Exchanges for clearing house 924,753.63 161,213.03 2,552,616.60 Checks and other cash items 458.00 20,828.26 56,940.23 National bank notes and notes of other Federal Reserve Banks 1,080,260.00 415,565.00 2,395,950.00 Mutilated currency (other than own Federal Reserve notes) forwarded for redemption 494,265.00 232,250.00 Due from Assistant Treasurer of the United States 252,000.00 Collection items—Debits: Federal Reserve Banks—Transfers bought 1,164,000.00 803,000.00 o Federal Reserve Banks—Other items 8,869,384.45 6,858,948.47 3,6C8,787.35 w Branches and offices * 674,174.47 H Bond coupons 110,433.15 o Member and nonmember banks and bankers 12,633,421.50 10,720,627.38 8,865,130.93 Uncollccted items 25,529,000.00 18,177,000.00 19,249,000.00 H H Total deductions from gross deposits 36,735,000.00 18,177,000.00 SO, 461,000.00 All other resources: Interest accrued on United States securities 21,575.24 Expense current 133,315.47 Bank premises 300,000.00 Other deferred charges 9,065.24 Dividend account, including premium on surrendered stock 105,253.79 Disbursements, Liberty Loan No. 2 40,971.15 Disbursements, War-Savings Stamps 2,250.59 Overdrafts—Member banks 50,074.18 Nickels and cents 7. 43 Total all other resources.. 662,513.09 Less all other liabilities: Discount earned on bills discounted.. 306,848.85 Discount earned on bills bought 114,868.82 Interest earned—Municipal warrants. 164. 77 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Statement showing condition of each Federal Reserve Bank and of the system on Dec. 31, 1917—Continued. 00 RESOURCES—Continued. [Detailed figures shown for each bank in first column represent items as reported to the Board; figures in second column, printed in italics, indicate results of consolidation according to methods used in the compilation of the Board's weekly statement.] Cleveland. Richmond. Atlanta. Less all other liabilities—Continued. Interest earned—United States securities $46,492.23 Penalties on deficient reserves 19,585.89 Sundry profits.. 1,010.55 o w Unearned discount on bills discounted 58,610.33 H Unearned discount on bills bought 41,594.05 o Service charges net . . . . 4,386. 69 hrj Difference account 115.33 H Profit and loss 28,154.92 W Suspense account 20.00 hrj Total all other liabilities 621,852.43 A11 other resources, net $41, 000. GO Total resources $267,538,000.00 126,743,000.00 $118,158,000.00 Chicago. St. Louis. Minneapolis. Gold bullion and United States coin $78,345.00 SI, 447.50 SO, 688,900.00 United States gold certificates (including clearing-house certificates) 32,110,960.00 5,087,690.00 8,270,770.00 o Gold coin and certificates in vault $32,189,000.00 $5,089,000.00 $14,960,000.00 Gold settlement fund, Federal Reserve Board . . 58,960,460.00 68,961,000.00 17,884,000.00 17,884,000.00 19,486,500.00 19,487,000.00 Gold with foreign agencies 7,350,000.00 7,350,000.00 2,100,000.00 2,100.000.00 2,100,000.00 2,100,000.00 Total gold held by banks 98,500,000.00 25,073,000.00 36,547,000.00 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Gold with Federal Reserve agents f 130.723,530.00 150,723,000.00 32,366,430.00 32,366,000.00 32,909,950.00 32,910,000.00 Gold redemption fund with United States Treasurer. I 646,490.00 646,000.00 929,900.00 930,000.00 878,225.00 878,000.CO Total gold reserves 229,869,000.00 58,369,000.00 70,335,000.00 Legal tender notes (including clearing-house certificates). 611,500.00 395,480.00 179,105.00 Silver certificates (including clearing-house certificates)... 340,150.00 370,603.00 231,924.00 Silver coin 12,152.00 543.50 2,120.00 cj Legal tender notes, silver, etc 4,000.00 767,000.00 413,060.00 > Total reserves 230,833,000.00 59,136,000.00 70,748,000.00 Member banks' collateral notes. 57,742,749.95 7,905,420.00 1,059,992.00 d o All other bills discounted 47,375,871.75 25,554,815.60 12,010,457.01 w Bills discounted for members and Federal Reserve Banks 105,119,000.00 33,460,000.00 13,070,000.00 H Bills bought in open market 9,182,429.93 9,182,000.00 7,362,724.15 7,363,000.00 7,166,677.76 7,167,000.00 Total bills on hand 114,301,000.00 40,823,000.00 20,237,000.00 H W ft Other United States bonds owned 7,006,600.00 2,233,400.00 1,887,990.00 United States Government long-term securities 7,007,000.00 2,233,000.00 1,888,000.00 One-year Treasury notes 3,378,000.00 1,444,000.00 1,340,000.00 ft United States certificates of indebtedness. 500.00 to United States Government short-term securities 3,378,000.00 1,444,000.00 1,340,000.00 Municipal warrants. 25,380.00 w Bill of lading drafts 804,554.29 566,536.89 960,758.32 w AII other earning assets 805,000.00 567,000.00 986,000.00 w ft Total earning assets 125,491,000.00 45,067,000.00 24,451,000.00 % ft Due from other Federal Reserve banks—Collected funds 40,700,661.92 11,283,058.19 W c Due to other Federal Reserve Banks—Collected funds 34,205,435.85 8,449,634.85 > Due from other Federal Reserve Banks—Net 6,495,000.00 2,834,000.00 Exchanges for clearing house 1,517,549.12 514,252.43 Checks and other cash items 599,179,46 National bank notes and notes of other Federal Reserve Banks., 475,000.00 2,047,705.00 169,361.00 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Statement showing condition of each Federal Reserve Bank and of the system on Dec. SI, 1917—Continued. RESOURCES—Continued. [Detailed figures shown for each bank in first column represent items as reported to the Board; figures in second column, printed in italics, indicate results of consolidation according to methods used in the compilation of the Board's weekly statement.] Chicago. St. Louis. Minneapolis. Mutilated currency (other than own Federal Reserve notes) forwarded for redemption 840,000.00 Collection items—Debits- w nj Federal Reserve Banks—Transfers bought $8,178,412.26 1,465,000.00 SI, 235,000.00 o Federal Reserve Banks—Other items 8,435,661. 74 6,665,875.45 729,552.53 w Branches and offices . 9 915 446.23 310,077.65 H Member and nonmember banks and bankers 5 274 225.57 3,063,947.48 O Uncollected items §28,522,000.00 %1C, 317,000.00 %5,797,000.00 H H Total deductions from gross deposits 28,522,000.00 22,812,000.00 8,631,000.00 Total resources 384,846,000.00 127,015,000.00 ion,830,000.00 o Kansas City. Dallas. San Francisco. Total. Gold bullion and United States coin $118,742.50 $127,180.00 116,202,525.00 399,633,994.71 m United States gold certificates (including clear- W ing-house certificates) 1,591,780.00 11,773,000.00 10,238,560.00 396,715,160.00 Gold coin and certificates in vault $1,711,000.00 $11,900,000.00 $26,441,000.00 $496,349,000.00 Gold settlement fund, Federal Reserve Board 37,263,377.50 87,263,000.00 24,520,700.00 24,520,000.00 17,072,000.00 17,672,000.00 302,981,237.50 302,981,000.00 o Gold with foreign agencies 2,625,000.00 2,025,000.00 1,837,500.00 1,838,000.00 2,887,500.00 2,888,000.00 52,500,000.00 52,500,000.00 Tctal gold held by banks 41,599,000.00 88,258,000.00 47,001,000.00 851,830,000.00 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Gold with Federal Reserve Agents 42,025,170.00 42,025,000.00 25,036,675.00 25,037,000.00 46,993,550.00 46,993,000.00 803,169,315.00 803,169,000.00 Gold redemption fund with United States Treasurer 507,045.00 • 507,000.00 1,217,607.02 1,218,000.00 24,335.00 24,000.00 19,406,630.15 19,406,000.00 Total gold reserves 84,131,000.00 64,513,000.00 94,018,000.00 1,674,405,000X0 Legal tender notes (including clearing house certificates) 11,000.00 155,250.00 66,425.00 34, 715,268.00 cj Silver certificates (including clearing house > certificates) 45 810.00 487,436.00 279,284.00 14,272,909.00 Silver coin 843.00 136,020.89 63,113.55 231,684.59 Legal tender notes, silver, etc 58,000.00 779,000.00 409,000.00 49,220,000.00 o w Total reserves.... 84,189,000.00 65,292,000.00 94,427,000.00 1,723,625,000.00 H Member banks' collateral notes 17,277,467.89 940,000.00 2,316,688.32 222,381,459.16 O All other bills discounted 17,776,976.31 7,799,996.88 23,463,512.86 437 930 423.43 rrj Bills discounted for members and Federal Reserve Banks 35,055,000.00 8,740,000.00 25,780,000.00 660,311,000.00 Bills bought in open market 1,337,928.75 1,338,000.00 14,140,549.66 14,140, 000. 00 17,082,455.93 17,083,000.00 273,235,704.90 273,237,000.00 Total bills on hand 36,393,000.00 22,880,000.00 42,863,000.00 933,548,000.00 United States bonds to secure circulation 8,000,000.00 2,732,400.00 10,732,400.00 Other United States bonds owned 849,090.00 1,763,700.00 2,455,000.00 41,096,532.05 United States Government long-term securities.. 8,849,000.00 4,496,000.00 2,455,000.00 51,829,000.00 One-year Treasury notes 1,784,000.00 1 430 000.00 1 500 000.00 26 792 000.00 United States certificates of indebtedness 43 050 500.00 United States Government short-term securities.. 1 784 000.00 1,430,000 00 1,500,000.00 69,842,000.00 Municipal warrants 150,458.74 988,145 44 Bill of lading drafts 682,058.19 3,610,084.26 o All other earning assets 832,000.00 4,598,000.00 Total earning assets 47,026,000.00 29,639,000.00 46,818,000.00 1,059,817,000.00 GO Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Statement showing condition of each Federal Reserve Bank and of the system on Dec. 31, 1917—Continued. 00 to RESOURCES—Continued. [Detailed figures shown for each bank in first column represent items as reported to the Board; figures in second column, printed in italics, indicate results of consolidation according to methods used in the compilation of the Board's weekly statement.] Kansas City. Dallas. San Francisco. Total. > r Due from other Federal Reserve Banks- Collected funds $2,731,547.83 $5,908,933.84 $74,307,445.95 Due to other Federal Reserve Banks—Collected funds 768 876.52 44 699 494.34 O W Due from other Federal Reserve Banks—Net. ... $2 732,000.00 $5,140,000.00 $8,499,000.00 H Exchanges for clearing house 72,871.41 151,154.45 2 181 816.08 20,566,989.16 O Checks and other cash items... 160,809.46 4,598.63 25,276,874.76 hxj National Bank notes and notes of other Federal H Reserve Banks 216,300.00 3,780,011.00 877,826.00 13,867,928.00 Mutilated currency (other than own Federal Reserve notes) forwarded for redemption) 1 768,450.00 Checks lost in transit 58.00 Due from Assistant Treasurer of the United States 300,000.00 552,000.00 Collection items—Debits: Federal Reserve Banks—Transfers bought.. 5,683,982.31 4,372,699.26 1,954,715.68 25,426,809.51 Federal Reserve Banks—Other items 3, 466,329.80 827,144.24 1,744,714.82 95,022,994.73 Branches and offices 1 747 950.24 12 647 648.59 Bond coupons 110,433.15 Member and nonmember banks and bankers. 15,583,135.50 5,754,831. 71 4,295,012.50 101,875,605.30 w o Uncollccted items 25,184,000.00 $15,086,000.00 12,806,000.00 297,116,000.00 Total deductions from gross deposits 27,916,000.00 15,086,000.00 17,946,000.00 305,613,000.00 5 per cent redemption fund against Federal Reserve Bank notes 400,000.00 400,000.00 136,700.00 137,000.00 536, 700.00 537,000.00 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

All other resources: Interest accrued on United States securities. 23,449.37 45,024.61 Expense current 144,156.27 277,471.74 Bank premises 120,000.00 420,000.00 Furniture and equipment- 26,981.09 26,981.09 > Cost of unissued Federal Reserve currency. 13,232.19 13,232.19 "A Other deferred charges 9,065.24 yA d Dividend account, including premium on > surrendered stock 105, 253.79 Disbursements, transit department 35,961.05 35, 961.05 w Disbursements, Liberty Loan No. 1 24,429.49 24, 429.49 w Disbursements, Liberty Loan No. 2 222,607.05 263, 578.20 o w Disbursements, War-Savings Stamps 568.24 2,818.83 H Overdrafts—Member banks 523,843.20 573, 917.38 o Difference account 464. 72 464.72 Nickels and cents 2,740.82 2,748.25 hrj H Total all other resources 1,138,433.49 1,800,946.58 w Less all other liabilities: Discount earned on bills discounted 270,804.44 577,653.29 w Discount earned on bills bought 181,770.29 296,639.11 w Transfers bought and sold, net charges... 38,658.39 38,658.39 Interest earned—Municipal warrants 424.46 589.23 w Interest earned—United States securities. 79,416.50 125,908.73 w m Commissions earned 52.08 52.08 M Penalties on deficient reserves 17,297.67 36,883.56 W Sundry profits 1,010.55 Unearned discount on bills discounted 107,413.32 166,023.65 Wo Unearned discount on bills bought 46,222.18 87,816.23 > Reserved for sundry expenses 50,000.00 50,000.00 fcd Service charges, net 21,768.72 26,155.41 Difference account 115.33 00 CO Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Statement showing condition of each Federal Reserve Bank and of the system on Dec. 31, 1917—Continued. OO RESOURCES—Continued. [Detailed figures shown for each bank in first column represent items as reported to the Board; figures in second column, printed in italics, indicate results of consolidation according to methods used in the compilation of the Board's weekly statement.] Kansas City. Dallas. San Francisco. Total. Less all other liabilities—Continued. Profit and loss $14,475.91 $42,630.83 Suspense account 20.00 O Total all other liabilities 828,303.96 1,450,156.39 w All other resources, net $310,000.00 $.151,000.00 H O Total resources $159,531,000.00 $110,153,000.00 159,501,000.00 .1,089,945,000.00 M LIABILITIES. Boston. New York. Philadelphia. o Capital $5,858,450.00 $18,684,850.00 $6,141,850.00 Capital—suspense account 11,100.00 300.00 Capital paid in $5,858,000.00 $18,696,000.00 96,142,000.00 Government deposits 2,419,414.94 2,419,000.00 11,870,707.74 11,871,000.00 4,832,816.11 4,833,000.00 Due to members—reserve account 82,244,369.22 82,245,000.00 652,791,808.26 652,792,000.00 84,574,264.34 8/h574,000.00 Due to other Federal Reserve Banks, collected funds 3,870,139.46 7,610,609.86 4,296,240.29 Due from other Federal Reserve Banks, collected funds W Due to other Federal Reserve Banks, net 3,870,000.00 7,611,000.00 4,296,000.00 O P Cashier's expense, return item, and dividend checks 23,482.60 4,821,389.92 435,026.66 Federal Reserve bank drafts 147.34 Federal Reserve exchange drafts 25.15 9.00 Collection items—credits: Federal Reserve Banks—transfers sold 250,000.00 Federal Reserve Banks—other items 2,332,237.7 5,156,779.75 2,850,790.00 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Member and nonmember banks 11,445,199.35 35,553,478.43 24,061,904.97 Miscellaneous . 90.40 94.47 G ovemment account ..... 554,672.42 Collection items 13,801,000.00 45,532,000.00 28,152,000.00 Foreign government credits 3,335,930.00 Due to nonmember banks clearing account 10,317,630.16 Other deposits, including foreign government credits.. 13,653,000.00 Total gross deposits 102,335,000.00 | 731,693,000.00 I 121,855,000.00 > t-1 Federal Reserve notes outstanding 77,296,820.00 456,338,565.00 97,325,755.00 w Less: j O Federal Reserve notes on hand 4,097,520.00 55,844,760.00 4,348,590.00 W Mutilated Federal Reserve notes forwarded for redemption 3,140,000.00 27.50 H Total deductions 4,097,520.00 58,984,760.00 4,348,617.50 Federal Reserve notes in actual circulation 73,199,000.00 397,354,000.00 92,977,000.00 W All other liabilities: Discount earned on bills discounted 571,117.13 2,240,121.86 302,264.77 Discount earned en bills bought 502 397 30 1,304,701.11 300,529.44 Transfers bought and sold, net charges 107. 80 Interest earned—Municipal warrants 5,202.73 5,776.03 1,658.06 Interest earned—United States securities 94,784. 86 224,780.66 66,561.20 Profits realized on United States securities 11,101.60 Commissions earned 6,938.15 13 680 73 Penalties on deficient reserves 6,105,39 4,815.90 4,382.21 Sundry profits 253. 72 19,458.52 3 720 84 1 Discount on U nited States bonds 6,875. 00 3,833.13 Unearned discount on bills discounted 249 459 57 611,916.47 96,844.03 o Unearned discount on bills bought 74 220 29 635 158 66 64,057.37 Unearned interest on municipal warrants 2,366.S8 1.11 Reserved for sundry expenses 1,444.55 19.79 Liberty 1 oan bonds—$10 participation certificates 227,970.00 00 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Statement showing condition of each Federal Reserve Bank and of the system on Dec. 31, 1917—Continued. CO LIABILITIES—Continued. [Detailed figures shown for each bank in first column represent items as reported to the "Board; figures in second column, printed in italics, indicate results of consolidation according to methods used in the compilation of the Board's weekly statement.] Boston. New York. Philadelphia. All other liabilities—Continued. Contracts to deliver Liberty loan bonds sold.. $6,186.25 Service charges, net $37,876.35 80,922.53 S79,581.63 Difference account 41.51 o w Profit and loss 11,590.56 339,649.98 176,626.52 Discount on bills sold 8,077.03 H Interest on participation certificates 316.31 O Suspense account S9,981.08 1,275. 75 Total all other liabilities.. 1,628,036. 45 5,821,157.68 1,097,564.23 Less all other resources: Interest accrued on United States securities 21,958,75 73,620.28 58,906.44 Service charges accrued S, 238.21 Expense current 255,690.82 656,534.85 141,768.66 Exchange paid 69.10 4.85 Bank premises 10,000.00 Furniture and equipment 8,973.83 29,123.11 Cost of unissued Federal Reserve currency 33,666.91 445,248.14 511.99 Other deferred charges. .................: 1,462.24 15,380.02 2,055.51 Dividend account, including premium on surrendered stock.. 3,926.85 1,466,719.68 467,727.53 w o Disbursements, transit department 96,132.22 147,206.18 101,701.36 Disbursements, Liberty loan No. 1 48,041.40 Disbursements, Liberty loan No. 2 142,887.62 299,982.22 100,032.85 Disbursements, war saving stamps 12,326.39 Revenue stamps 5,078.20 Repairs and alterations, remodeling account 10,450.00 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Overdrafts, member banks. 12,804.81 Difference account 813.26 628.85 Nickels and cents 2,115.81 257. 26 209.09 Total all other resources 575,470.40 3,171,023.47 933,084.41 All other liabilities, net ' 1,050,000.00 2,650, 000. 00 165,000.00 Total liabilities 182,442,000.00 1,150,159,000.00 221,139,000.00 > tr1 Cleveland. Richmond. Atlanta. Ow Capital $8,026,100.00 $3,663,950.00 $2,812,750.00 Hi Capital paid in ! $8,026,000.00 $3,664,000.00 $2,813,000.00 Government deposits 30,578,247.23 30,578,000.00 2,253,761.15 2,254,000.00 4,476,782.74 4,477,000.00 Due to members—reserve account 109,724,561.05 109,725,000.00 45,356,855.67 45,357,000.00 36,849,923.90 36,850,000.00 Due to other Federal Reserve Banks, collected funds 3,644,461.78 M Due to other Federal Reserve Banks, net ' 3,644,000.00 Cashier's expense, return item, and dividend checks 30,574. € 75,649.91 15,978.73 Federal Reser\7e bank drafts 115,280.00 Federal Reserve exchange drafts Collection items—credits: r Federal Reserve Banks—other items 3,760,358.95 G, 457,014.59 3,094,279.83 w Branches and offices 222,655.30 ti Member and nonmember banks 12,720,415.44 8,726,400. 22 5,423,001.18 i i Miscellaneous. 72,739. 80 .33 Collection items 16,584,000.00 15,260,000.00 8,871,000.00 Due to nonmember banks clearing account 91,160.59 97,903.27 W Other deposits, including foreign government credits 94,000.00 98)000.00 O l Total gross deposits 156,981,000.00 66,515,000.00 50,296,000.00 Federal Reserve notes outstanding 105,669,700.00 60,770,135.00. 66,867,420.00 00 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Statement shoiving condition of each Federal Reserve Bank and of the system on Dec. 31, 1917—Continued. 00 00 LIABILITIES—Continued. [Detailed figures shown for each bank in first column represent items as reported to the Board; figures in the second column, printed in italics, indicate results of consolidation according to methods used in the compilation of the Board's weekly statement.] Cleveland. Richmond. Atlanta, Less: Federal Reserve notes on hand $3,666,525.00 $4,189,830.00 $1,909,030.00 Mutilated Federal Reserve notes forwarded for redemption 120,000.00 16,500.00 43,500.00 o Total deductions 3,786,525.00 4,200,330.00 1,952,530.00 w H Federal Reserve notes in actual circulation $101,883,000 00 $56,564 000 00 $64,915,000.00 All other liabilities: Discount earned on bills discounted 333,9C0.67 181,023.19 Discount earned on bills bought 309,205.71 53,291.98 Transfers bought and sold, net charges 9,305.10 14,177.99 Interest earned—Municipal warrants 7,399.92 1,903. 75 Interest earned—United States securities 198,350.57 98,038.45 Interest earned—Bill of lading drafts 1,436.95 r1 Penalties on deficient reserves 13,617.31 12,038.82 Sundry profits 2,804.95 2,348.03 Discount on United States bonds 437. 50 Unearned discount on bills discounted 116,570.72 37,292. 75 Unearned discount on bills bought .. - 62,600.28 26,635.01 Unearned interest on municipal warrants . 1,229.25 w Unearned interest on certificate of indebtedness 11,472.23 o Reserved for sundry expenses . * 309. 98 34,332.08 > Service charges net . - ... . 41,679.01 30,696.91 Difference account - . . .. 184. 66 Profit and loss 177,386.94 51,365.93 Total all other liabilities - 1,344,968.11 546,849.19 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Less all other resources: Premium on United States bonds 209,469.52 ! Interest accrued on United States securities 62,878.48 25,814.07 Expense current 215 264 85 101,837.42 Exchange paid .... 57.62 Sank premises 140,875.20 Cost of unissued Federal Reserve currency 588.24 Other deferred charges 2,237.36 Dividend account, including premium on surrendered stock 197. 40 1,650.27 Disbursements, transit department 56,722. 22 32,973.95 Disbursements, Liberty loan No. 1 6,260. 62 Disbursements, Liberty loan No. 2 131,404. 60 44,514.02 O w Disbursements, war saving stamps... . 1,582. 61 1,180.05 H Service charges paid—Collection department 119 10 O Overdrafts member banks 11,792.01 Difference account 272.01 Nickels and cents 870.35 407.51 Total all other resources 696,619.38 412,350.10 A U other liabilities, net 648,000.00 134,000.00 Total liabilities 267,538,000.00 126,7lfS, 000.00 118,158,000.00 Chicago. St. Louis. Minneapolis. Capital $9 091 700.00 $3 474 600.00 §2 612,450.00 Capital—suspense account 7,700.00 W Cd'pitdl paid in - $9 092 000.00 $3 475 000.00 $2,620,000.00 O Governvieni deposits. 3,052,436.84 3,052,000.00 5,430,359.99 5,430,000.00 8, 716,529.47 8,717,000.00 Due to members—reserve acSbunt 169,174,348.05 169,174,000.00 45,796,967.60 45,797,000.00 39,347,899.01 39,348,000.00 Due to other Federal Reserve Banks, collected funds 6,165,983.77 Due from other Federal Reserve Banks collected funds 5 992 720.41 Due to other Federal Reserve Baiiks net 173 000 00 Cashier's expense, return item, and dividend checks 244,404.64 197,223.90 31,488.47 00 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Statement showing condition of each Federal Reserve Bank and of the system on Dec. 31, 1917—Continued. LIABILITIES—Continued. [Detailed figures shown for each bank in first column represent items as reported to the Board; figures in the second column, printed in italics, indicate results of consolidatio: according to methods used in the compilation of the Board's weekly statement.] Chicago. St. Louis. Minneapolis. Federal Reserve bank drafts $5,096.06 Federal Reserve exchange drafts . 325.90 Collection items—credits: Federal Reserve Banks—'transfers sold $1,470,000.00 $820,000.00 O w Federal Reserve Banks—other items 3,619,175.99 1,468,334.24 2,069,429.73 Branches and offices 779,251.41 H Member and nonmember banks 14,639,568.31 8,843,947.26 1,125,226.30 O Miscellaneous 34,701.89 42,724.30 163,096.52 w Government account 22,465.94 7,228.62 Collection items. $19,438,000.00 $12,151,000.00 $S,395,000.00 Foreign government credits Due to nonmember banks—clearing account * 3,198,413.97 93,432.34 36,300.00 Other deposits, including foreign government credits 3,199,000.00 93,000.00 36,000.00 Total gross deposits 195,036,000.00 63,471,000.00 51,496,000.00 Federal Reserve notes outstanding . . 190,788,530.00 61,863,430.00 51,005,950.00 W Less: fed Federal Reserve notes on hand 9,727,000.00 1,940,400.00 1,420,8(55.00 Mutilated Federal Reserve notes forwarded for redemption 433,500.00 171,000.00 W o Total deductions 10,160,500.00 1,940,400.00 1,591,865.00 TPpdpTcil "RPVPTVP note? in actual circulation 180,628,000.00 59,923,000.00 49,414,000.00 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

All other liabilities: Discount earned on bills discounted 876,485.79 358,238.50 242,284.63 Discount earned on bills bought 230,213.05 170,233.26 72,476. 74 Transfers bought and sold, net charges 96,404.08 57,919. 95 35,117.63 Interest earned—Municipal warrants 334.32 13,691.40 254. 60 Interest earned—United States securities 291,651.33 110,300.98 49,184. 97 Interest earned—Bill of lading drafts 3,632.66 7,492.56 6,535.87 Penalties on deficient reserves 6,749.33 14,968.34 3,909. 94 Sundry profits 723.37 920.50 701.02 Collection department service charges 55.36 59.60 Discount on United States bonds 5,682.39 Unearned discount on bills discounted j 272,959.85 103,036.43 77,460.09 Unearned discount on bills bought ! 45,127.48 30,385.77 16,814.30 Unearned interest on municipal warrants ? 6.21 ' i* Eeserved for sundry expenses ! 4,833.62 853.65 Liberty loan bonds—$10 participation certificates ! 1(53,100.00 Federal Reserve Bank transfer drafts j 1,064.20 Federal Reserve Bank exchange drafts I 283.25 Service charges, net 34.075. 39,057.53 50,590.69 I Difference account 223.16 ! Profit and loss 122,690.76 12,748.15 49,383.55 | Total all other liabilities.. 2,150, 383. 93 920,129.78 610,402.63 I Less all other resources: Premium on United States bonds „, 106,474.74 6,353.15 Interest accrued on United States securities.., 63,695. 00 24.850.94 17,841.63 \ Expense current 314,834.15 236,477.15 112,686.71 I Exchange paid 223.97 80.19 Furniture and equipment 44,498.74 66,065.25 Cost of unissued Federal Reserve currency 43;001.01 16,166.61 32,915.48 Other deferred charges 784.07 1,626.51 2,127.12 Dividend account, including premium on surrendered stock.. 656,421.38 284,565.61 Disbursements, transit department 32,044.83 34,392.40 44,461.13 Disbursements, Liberty loan Ko. 2 284.904.44 124,849.47 53,797.73 Disbursements, United States certificate of indebtedness 2,523.49 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Statement showing condition of each Federal Reserve Bank and of the system on Dec. 31, 1917—Continued. o LIABILITIES—Continued. [Detailed figures shown for each bank in first column represent items as reported to the Board; figures in the second column, printed in italics, indicate results of consolidation according to methods used in the compilation of the Board's weekly statement.] Chicago. St. Louis. Minneapolis. Less all other resources—Continued. Disbursements, war savings stamps $329.16 Deferred charges, Liberty loan I $54.067.19 Revenue stamps ! 359.48 c Liberty loan bonds—$10 participation certificates j 183,100.00 H Overdrafts, member banks | 330,615. S3 o Difference account i 539.40 15.37 hj Nickels and cents I 70.27 S7S7. 24 16. 61 H M Total all other resources. 2,060,259.27 774,048.01 310,250.19 I H All other liabilities, net j I $90,000.00 $116,000.00 $.100, GOO. CO Total liabilities 384,846,000.00 127,01,5,000.00 ! 103,830,000.00 Kansas City. Dallas. San Francisco. Total. Capital j $3,395,750.00 $2,794,900.00 $4,141, 750.00 $70,699,100.00 Capital—suspense account 1,000.00 20,700.00 40,800.00 Capital paid in $3, S97,000.00 $2,795,000.00 $4,162,000.00 740,000. co Government deposits 7,860,957.17 7,801,000.00 6,609,284.55 6,609,000.00 12,353,938.63 12,354,000.00 100,455,296.56 100,455, wo. 00 Due to members—reserve account 72,976,491.13 72,976,000. GO 44,155,240.99 44,155,000.00 2,353,933.63 63,780,000.00 1,446,772,639.56 1,446,773,000.00 Due to other Federal Reserve banks, collected O funds 4,363,664.79 29,951,099.95 Due from other Federal Reserve Banks, collected funds 2,847,694.30 8,840,414.71 Due to other Federal Reserve Banks, net 1,516,000.00 Cashier's expense, return item, and dividend checks ...,,.., )7O,542.14 104,903.32 ] 2,062,479.92 j... 9,013,149.90 , Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Federal Reserve bank drafts 1 120,523.40 Federal Reserve exchange drafts 991.19 1,027.07 2,605.40 Federal Reserve transfer drafts 3,142.00 3,142.00 Collection items—credits: Federal Reserve Banks—-transfers sold 275,000.00 752,924.90 3,567,924.90 Federal Reserve Banks—other items 5,621,630.98 5,355,942.73 2,662,719.31 44,449,293.87 Branches and offices 741,049.45 1,742,956.16 Member and nonmember banks 4 726 170.00 2,033,496.85 3,291,101.68 131,989,909.69 Miscellaneous 81,803.71 395,251.42 Government account Suspense ' ' 7,228.62 Collection items 11,595.000. GO 8/250,000.00 9,403,000.00 191,869,000.00 O Foreign government credits 3 335 930.00 Due to nonmember banks clearing account 25,319.87 2,620,985.05 16,484,145.25 o Other deposits, including foreign government credits £6,000.00 2 621,000.00 19,820,000.00 fed H3 Total gross deposits 92,458,000.00 60,530,000.00 87,595,000.00 1,758,917,000.00 HH hH Federal Reserve notes outstanding 58,023,420.00 47,716,950.00 77,097,550.00 1,350,764,225.00 fed Less: Federal Reserve notes on hand 2,410,710.00 735,000.00 9,343,245.00 99,633,475.00 Mutilated Federal Reserve notes forwarded for redemption 240,000.00 194,500.00 10,000.00 4,369,027.50 Total deductions 2,650, 710.00 929,500.00 9,353,245.00 104,002,502.50 in Federal Reserve notes in actual circulation 55,373,000.00 46,788,000.00 67,744,000.00 1,246,762,000.00 Federal Reserve Bank notes in circulation, net liability 8,000,000.00 8,000,000.00 8,000,000.00 8, 000,000.00 All other liabilities: o Discount earned on bills discounted... . 438,831.43 160,869. SO 5 705 197.77 w Discount earned on bills bought 171,112.15 116,481. 74 3,290,702.37 Transfers bought and sold, net charges 45,569.84 32,476.91 291,079.36 Interest earned—Municipal warrants 5 136.63 1,068.29 42,425.73 Interest earned—United States securities... 256,792.18 SO, 743.84 1,471,189.04 CO CO Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Statement showing condition of each Federal Reserve Bank and of the system on Dec. SI, 1917—Continued. O' LIABILITIES—Continued. [Detailed figures shown for each bank in first column represent items as reported to the Board; figures in the second column, rrinted in italics, indicate resultscf consolidation according to methods used in the compilation of the Board's weekly statement.] Kansas City. Dallas. San Francisco. Total. ^ All other liabilities—Continued. > Interest earned—Bill of lading drafts $3 389. 20 $22,487.24 Profits realized on United States securities.. 11,101.60 h* Commissions earned. 20,618.8S Penalties on deficient reserves. $37 395 78 112,939.37 Sundry profits 5.00 7.05 31,003.60 H Collection department service charges 114.96 C Discount on United States bonds 16,828.02 Unearned discount on bills discounted 119,018. 52 50,145.39 1,734,703.82 H Unearned discount on bills bought 780. 53 35,54^. 03 991.323.72 U Unearned interest on municipal warrants 1,914.19 5,517.64 l-rj Unearned interest on certificates of indebt- t edness.. 11,472.23 Reserved for sundry expenses 1 262.25 42,055.92 w Liberty loan bonds—$10 participation cerw tificates 391,070.00 Federal Reserve Bank transfer drafts... 1,064.20 N Federal Reserve Bank exchange drafts 283.25 wTfl Contracts to deliver Liberty loan bonds sold 6,186.25 < Service charges, net 46, 710. 09 52 923 17 544.113.39 Difference account . 1,604.80 2,189.07 0 Profit and loss 67,025.17 1,008,473.56 Discount on bills sold 8,077.03 Interest on participation certificates. . 316.31 Susioense account 91,256. 83 Total all other liabilities 1,189 982 21 544,317.15 15 853 791 27 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Less all other resources: Premium on United States bonds ... 75 4h2 42 397, 759. S3 Interest accrued on United States securities. 60,504. £0 28,1SS. 78 438, 259.27 Service charges accrued 8,238.21 Expense current 237 377.98 109,502.80 | 2 441 975 39 Exchange paid 435.73 Proiit and loss 55,585.43 55 585 43 Bank premises 136,736.31 i 287,611.51 Furniture and equipment 32 97^ t:3 35,824. 77 217 458 33 Cost of unissued Federal Reserve currency. 42,507. 74 10,161.62 604,737.74 w Other deferred charges 5,766.89 8,579.61 46,019.33 w Dividend account, including premium on o surrendered stock 276,581.85 210.72 3,354,843.89 w Disbursements, transit department 54,906.18 52,540.15 653,080.62 H Disbursements, Liberty loan No. 1 .... 9, 795.22 64,097.24 C Disbursements, Liberty loan No. 2 86,449.96 54,153.44 1,322,976.35 Disbursements, United States certificates of indebtedness 2,523.49 Disbursements, war saving stamps . . . 1,057.33 16,798.53 Service charges paid—Collection department 119.10 Deferred charaes Liberty Joan 54,657.19 Revenue stamps 5,437. 8S Liberty loan bonds account—S10 participa- 1 j tion certificates i 163., 100.00 Repairs and alterations, remodeling account . 10,450. 00 Overdrafts member banks 355.212.07 Difference account 497.81 2 766 70 Nickels and cents 350.63 2 168 76 7,253. 53 Suspense account 13,958.35 13,958.35 Total all other resources 887,337. 34 504,504. 94 ! 10,327,553.51 All ofJier liabilitifs wt 303,000.00 f,n nnn on 5 5°G 000 00 Total liabilities 159,031,000.00 110,153,000.00 1 159,501,000.00 3,089,945,000.00 CO Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Exhibit D.—INVESTMENT OPERATIONS OF FEDERAL RESERVE BANKS. CO Commercial paper discounted for members and oilier Federal Reserve Banks during each month in 1917, distributed by maturities, and totals for 1917, 1916, and 1915. PAPER MATURING WITHIN 15 DAYS. Feder B a a l n R k e . serve January. February. March. April. May. June. July. August. Se b p e te r m . - October. November. December. Total. c P e e n r t. Boston $847,389 $1,882,783 $3,816,628 $9,118,269 $9,493.345 134,571,777 $35,,073,9601161.,902,573 $21,307. $6,770, $14,243,721 $20,137,602 $174,166,003 2.1 New York 279,272 1,502,805 ,801,099 ,316,507 6,201.947 547,878,686 254,,205,950 46,569,820 307,344. ,359,046, ,623,764,467 192,834, 0,344,746, 768 78.0 o w Philadelphia 247,937 1,149,757 ,667,902 ,164,269 18,545; 38,818,843 862,985 14,596, 17,174, 11,962, 17,402,072 32,1255,,650 175,777,337 2.3 H Cleveland 182,617 2,499,000 ,416,237 ,730,998 4,416. 7,072,863 315,850 9,981, 15,123, 22,775, 28,180,622 38,051,342 746,220 1.8 o Richmond 6,737,047 3,985,444 ,136,837 ,250,442 20,353. 25,174,706 559,333 25,063, 44,511, 21,490, 50,924,399 112,143,939 350,;331,151 4.2 Atlanta 963,075 384,855 448,953 833,649 1,392, 617,866 398,738 1,557, 5,358, 13,236, 18,868.473 18,660,329 721,356 0.8 Chicago 521,480 1,926,44! ,391,246 ,207,981 2,477. 18,656,376 612,209 12,901, 25,552, 80,684, 127,880,288 110,649.863 463,238 5.1 St. Louis. 400,500 384,908 ,670,566 ,713,018 2,243, 2,324,6626 080,61 12,181, 17,128, 18,419, 25,530,285 36,715, 131, '99,689 1.6 Minneapolis 376,428 577,600 102,081 252,628 1,011, 4,011,,0004 922,046 3,512, 1,953, 5,120, 14,904,674 3,890,'02 39,i634,387 0.5 Kansas City 75,606 10,000 60,223 29,510 2,931, 9,730,3334 555,970 17,259, 25,913, 41,639, 63,996,325 33,698L,605 209,'900,693 2.6 Dallas 162,630 316,500 182,886 224,414 841, 1,929,4400 330,400 1,630, 3,658, 10,682, 10,981,317 2,117,832 34,'057,779 0.4 San Francisco 4,514 25,931 126,302 50, 400,9935 392,721 2,482, 3,320, 9,609, 18,261,156 9,206, 45,941,273 0.6 Total .0,804,495 1,646,032 !, 694,658134,967,987 69,958,620!691,247,410403,310,779 164,039,110 4881.,347,2992,601,488,919•*, 014,997,799 016,232,7808,129,285,894 Percent 0.1 0.2 0. 2 0.4 0.9! ! 5. 0 2. 0 6.0 32.0 37.1 100.0 PAPER MATURING AFTER 15 DAYS BUT WITHIN 30 DAYS. o Boston $102,130SI, 015,170 $298,485 $180,269 $428,92! $6,106,821 $2,760,025 $2,179,412 $1,105,029 $770,204 $9,918,861 $14,922,953 $39,87S,294 21.8 New York 69,457 22,354 23,139 30,753 40,873 1,289,269 428,914 747,493 3,151,604 3,359,466 1,245,41' 9,777,321 20,ISO,0601 11.0 o Philadelphia 120,203 205,267 74,442 137,441 1,283,516 1,674,570 403,791 3D4,123 568,323 509,^ 708,9S: 6,206,425 12,280,573 6.7 Cleveland 271,658 9,748 572,856 125,824 175,775 1,090,043 275,794 3,338,040 974,081 949,270 5,174,169 13,084,185 26,101,443: 14.2 Richmond 3S2,399 373,112 430,766 509,808 935,616 897,750 800,459 837,981 1,272,245 713,285 663,990 1,852,203 9,669, CSOj 5.3 Atla-nta , 142,099 181,112 108,269 211,296, 421,469 324,1451 235,517 1,019,960 475,233 964,005, 1,328,520 1,333,061 6,745,886 3.7 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Chicago 337,583 23,962 552,993 451,247 258,174 2,234,454 5,183,125 1,585,208 3,016,285 3,841,465 5,105,413 3,737,096 26,327,005 14.4 St. Louis 73,000 87,317 8,061 724,023 691,898 486,417 615,065 823,017 2,689,767 3,486,396 1,423,566 3,927,090 15,030,217 8.2 Minneapolis... 179,316 396,500 13,024 982,267 220,678 900,098 329,286 1,566,541 136,377 617,798 520,369 440,027 0,308,2S1 3.4 Kansas City.. 5,738 15,050 142,74 88,985 344,136 279,022 183,357 648,012 496,S87 373,504 960,006 2,039,877 5,577,321 3.0 Dallas 11,630 16,143 87,179 178,608 64,580 236,006 195,304 101,493 135,632 66,742 387,235 144,133 1,624,685 0.9 San Francisco. 7,863 9,266 8,578 200,577 114,823 2,520,000 658,891 474,815 1,879,306 1,863,551 2,073,355 3,731,567 13,542,592 7.4 Total... 1,703,682 2,355,001 2,320,539 3,821,098 4,980,467 18,128,601 12,069,528 13,776,695 15,900,769 17,515,171 29,509,888 61,202,598 183,284,037 Percent 0.9 1.3, 1.3 2.1 2.7 9.9 6.6 8.7 9.5 16.1 33. 4 100.0 PAPER MATURING AFTER 30 DAYS BUT WITHIN 60 DAYS. o Boston... $120,008 $702,647 $574,161 $454,771 $445,623 $2,082,554 $1,583,857 $2,936,784 $1,567,284 $1,274,929 $4,086,615 $25,837,504 $41,072,737 15.3 H New York 123,129 184,002 144,973 39,924 164,070 1,826,898 1,682,261 1,638,995 3,575,917 5,802,649 6,708,561 40,785,107 62,070,486 18.1 O Philadelphia.. 184,102 234,028 234,570 53,762 338,565 1,640,491 940,462 256,472 717,629 716,249 1,575,537 2,897,808 9,789,075 3.6 Cleveland 103.128 7,490 9,249 67,460 161,618 2,058,820 1,052,308 769,585 840,816 1,407,251 0,340,481 5,913,400 18,873,618 6.9 Richmond 626.129 749,417 830,918 1,393,348 1,021,738 1.522,709 2,161, 1,783,789 2,405,684 1,606,785 1,520,664 2,444,608 18,673,' 6.8 Atlanta 479,583 177,403 352,060 420,936 753,648 1,127,223 1,602,495 1,422,901 1,420,993 1,596,045 1,886,530 2,850,888 14,090,705 5.2 Chicago 320,909 43, 704 147,414 1,408,387 199,024 2,753,808 3,805,235 3,354,411 4, 784,878 6,783,293 14,101,738 7,961,590 45,664,391 16. 8 St. Louis 31,546 84,994 71,133 188,549 1,423,881 622,850 1, 730,948 1,055,282 2,918,9.50 1,736,583 3,090,450 5,258,450 18,213,616 6.7 Minneapolis... 356,354 743,568 41,997 2,406,583 1,555,648 2,187,386 1,628,948 3,617,620 1,059,761 1,140,637 1,683,851 1,400,3S7 17,828,740 6.5 Kansas City... 38,780 23,452 39,378 20,137 352,915 763,251 574,514 828,020 864,681 826,044 1,709,514 2,634,597 8,735,283 3.2 Dallas 111,350 101,618 314,122 745,610 427,308 452,757 725,686 1,084,736 771,092 303,531 790,518 312,128 6,140,458 2.2 San Francisco. 25,509 34,705 46,790 216,360 132,380 2,883,932 1,176,061 879,106 2,762,084 1,923,762 3,803,274 9,718,05' 23,602,152 8.7 Total... 2,586,587 3,087,028 2,800,771 7,415,839 7,570,418 19,922,679 18,674,460 19,627, 701 23,695,709; 25,177, 758 47,309,733 108,020,530 2S5,967,339| Per cent 0.9 1.1 1.0 2.6 2.6 7.0 6.5 8.3| 16.6 37.8 37.8 100.0 W o cO Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Commercial paper discounted for members and other Federal Reserve Banks during each month in 1917, distributed by maturities, and totals for 1917O, 1916, and 1915—Continued. GO PAPER MATURING AFTER 60 DAYS BUT WITHIN 90 DAYS. Feder B a a l n R k e . serve January. February. March. April. May. June. July. August. Se b p e te r. m- October. November. December. Total. Per cent. Boston $122,929 8332,388 $409,489 $196,113 $934,332 $3,365,573 $3,012,317 U, 358,337 $1,768,744 $2,389,172 $32,169,170 $44,947,757 $94,006,321 20. 3 New York 126,304 211,842 92,305 52,039 138,383 1,981,604 6,048,980 4,060,991 5,471,685 14,684,329 31,948,847 44,020,836 108,838,145 27. S Philadelphia 12,080 88,294 30,769 2o,477 258,424 589, 704 1,966,750 2,923, 701 469,187 3,629,448 11,731,106 3, 795,492 25,531,432 Cleveland 16,690 26,105 16,611 37,016 170,213 960,985 1,212,024 650,069 760,418 1,100,987 7,857,827 6,577,943 19,386,888 Richmond 815,186 639,635 760,054 927,872 1,741,247 2,114,040 2,770,582 2,032,354 1,927,100 1,276,167 3,163,887 3,082, 713 21,250,837 6.0 Atlanta . 918,064 367,843 590,678 370,824 366,884 587,870 897,656 937,156 614,208 1,083,456 951,589 1,782,417 9,498,645 2.7 Chicago 47,659 19,696 141,88*7 92,881 149,513 1,357,3(>2 1,851,326 1,245,477 1,998,716 4,138,169 12,267,641 6,555,669 29,865,996 8.4 St. Louis 67,247 10,811 60,765 266,051 1,551,606 1,071,418 925,859 962,097 2,279,956 2,186,082 2,239,404 9,038,535 20,659,831 4.4 Minneapolis 197,410 19,706 20,193 258,107 466,491 1,690,522 1,748,877 1,837,722 1,106, 735 00!), 235 1,213,629 6,692,991 15,858,618 3.0 Kansas City 49,344 20,515 35,190 98,146 200,778 623,025 311,488 547,589 6(i5,261 1,200,034 2,071,544 6,993,324 12,876,238 Dallas 199,020 80,110 202,637 388,719 310,322 399,209 1,087,612 1,075,555 412,992 337,863 383,571 5,225,533 10,103,143 1.4 San Francisco 37, 707 32,344 74,157 139,828 125,995 3,089,878 1,534,758 654,651 1,344,130 1,971,127 2,655,771 6,981,795 18,642,141 5.2 Total 2,639,640 1,849,289 2,434,735 2,854,073 6,424,188 17,831,190 23,368,229 21,285,699 18,819,132 34,663,069 108,053,986 145,695,005 380,518,235 Per cent..... 0.7 0.5 0.6 0.7 1.7 4.6 6.0 5.5 4.9 9.0 28.1 37.7 100.0 AGRICULTURAL AND LIVE-STOCK PAPER MATURING AFTER 90 DAYS. Boston $200 $262,07 $580.860 $119,433 $233,060 $1,195,955 4.1 New York... $4,34<( SI, 067 $7,089 12,504...... Philadelphia. $800 4,876 1,610 $3,472 520l $1,295 1,870 4,214 2,425 900 30,991 0.1 Cleveland 10,878 2,667 10,108 2,279 6,897 4, 486 2,707 23,605 4,313 67,940 0.2 Richmond... 21,621 36,624 34,97 83,039 424,852 388,516 221,913 55,326 5,550 14, 722 350j 8,047 1,2S5,53 7J 4,5 Atlanta 28,651 41,813 41,158 131,117 208,036 173,976 113,537 77,639 35,524 93,572 14,257 32,842 1,052,152 3.6 Chicago 66,532 24,385 71,990 65,935 130,908 158,367 159,532 153,681 283,544 782,108 3,544,270 2,110,221 7,551,473 25.9 St- Louis 27,434 800 26,992 41,714 37,742 37,492 28,917 81,657 9,012 43,194 29,990 43,493 408,437 1.4 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Minneapolis 117,245 56,72-* 25, 796 202,912 53S,469 1,076,822 1,177,100 505,121 90,900 173,034 556,680 1,011,008 5,531,811 19.9 Kansas City 96,827 . 89,560 59,991 107,617 407,192 445,905 511,671 197,350 311,573 327,289 1,201,66C 1,847,892 5,604,527 19.3 Dallas 174,189 207,584 244,041 329,076 629,674 751,949 843,9C3 340,083 236,814 330,802 293,055 745,403 5,126,573 17.6 San Francisco 47,705 4,540 21,990 21,814 27,148 103,351 244,687 188,277 161,927 20,224 171,165 240,221 1,253,049 .4.3 Total 591,882 471,254 532,279 996,804 2, 473, 780 3,139,952 3,310,352 1,610, 709 1,401,135 2,370,937 5,955,355 6,276,500 29,130,949 Per cent 2.0 1.6 1.8 3.4 8.5 10.8 11.4 5.5 4.8 8.2 20.4 21.6 100.0 TOTx\L AMOUNT OF COMMERCIAL PAPER DISCOUNTED. w January. February. March. April. June. July. August. September. o Boston 51,198,462 S3,932,988 $5,098,763 $9,949,422 $11,302,429 $46,216,725 U2,430, 484 $20,377,106 $26,010,286 1-3 p New York 598,162 1,925,351 3,062,583 2,439,223 6,545,273 552,970,457 262,366,105 53,024,394 319,543,993 Philadelphia 565,122 1,682,222 3,009,293 2,385,421 20,445,040 42,724,903 22,175,858 18,170,441 18,934,001 Cleveland. 644,971 2,542,343 4,017,620 6,971,412 4,923,937 11,184,990 10,872,873 14,803,326 17,704,624 H W Richmond 8,582,382 5,784,232 4,193,552 12,164,509 25,070, 795 30,097,727 34,513,978 29,772,948 50,122,193 w Atlanta 2,562,072 1,153,026 1,541,118 1,967,822 3,202,925 2,831,080 4,247,943 5,015,168 7,904,732 Chicago 1,294,103 2,038,196 2,305,530 3,226,431 3,215,009 25,160,367 33,611,427 19,240,750 35,636,417 St. Louis 605,727 568,830 1,837,517 3,933,355 5,949,072 4,542,803 15,381,406 15,104,344 25,026,448 Minneapolis 1,226,753 1,794,098 203,091 4,102,497 3,792,396 9,865,832 8,806,257 11,039,240 4,347,036 Kansas City 260,295 158,577 337,529 344,395 4,236,848 11,841,537 16,137,000 19,480,868 28,251, 741 Dallas 658,819 • 721,955 1,030,865 1,800,427 2,273,089 3,769,321 4,182,905 4,231,867 5,215,021 9 San Francisco... 123,358 106,786 151,521 704,887 450,600 9, Q5S, 096 6,007,118 4,679,522 9, 467,612 in Total, 1917. 18,320,286 22,408,601 20, 788,982 50,055,801 91,413,473 750,2C9,838 400,733,354 220,939,974 518,164,104 Total, 1916. 11,115,000 7,664,600 9,387,300 11,521,500 11,195,500 11,600,000 20,183,000 17,351,800 14,308,800 Total, 1915. 10,712,800 12,530,300 13,399,700 10,549,300 12,145,700 13,406,000 13,238,000 12,233,700 14,405,000 Percent, 1917.... 0.2 0.3 0.3 0.0 1.0 8.4 5.1 2.5 0.1 o Percent, 1916 5.4 3.7 4.5 r r 5.4 5.6 9.7 S.3 0.9 Percent, 1915.... 6.7 7.8 8.3 6.5 7.5 8.3 8.2 7.6 8.9 CD Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Commercial paper discounted for members and other Federal Reserve Banks during each month in 1917, distributed by maturities, and totals for 1917, o 1916, and 1915—Continued. o TOTAL AMOUNT OF COMMERCIAL PAPER DISCOUNTED—Continued. October. November. December. Total, 1917. Total, 1916. Total, 1915. Per cent, Per cent, Per cent, 1917. 1916. 1915. Boston 785,9G9 $60537,800 $106,078 $350919,310 $33,921,900 •12,086,700 3.9 16.3 1.3 New York ,382,893,111 2,663 667,292 287,418 6,536 459,903 22,329,500 4,819,600 73.5 10.7 3.0 Philadelphia 16,819,730 31478,602 45,025 223416,008 22,328,400 5,137,100 2.5 10.7 3.2 W Cleveland 26,296,120 47582,704 63,631 211176,109 6,792,400 4,526,000 2.3 3.3 2.8 o Richmond 25,101,509 56279,290 119,531 401220,685 34,377,200 44,891,400 4.5 16. 5 27.8 Atlanta 16,973,352 23,049,3G9 24,666 95114,744 22,323,200 34,209,300 1.1 10.7 21.2 H Chicago 96,229,904 162899,350 137,014, 521872,103 23,178,100 9,238, 700 2.8 11.2 5.7 O St. Louis 25,871,747 32313.695 54,982, 186117,790 8,842,700 6,317,600 3.1 4.3 3.9 Minneapolis 7,658,319 18,879,203 13,447, 85,161,837 6,473,500 5,206,500 0.9 3.1 3.2 H tn Kansas City 44425,928 69,999,049 47,214, 242,694,062 6,817,700 10,875,500 2.7 3.3 6.8 Dallas 11,721,642 12,835.696 8,545, 57,052,636 18,512,500 26,756,900 0.6 8.9 10. G San Francisco 15,388,463 26,964,721 29,878, 102,981,207 1,973,400 7,287,700 1.1 1.0 4.5 Total, 1917. 2,681,165,854 3,206,486,771 937,433,413 9,014,186,454 Total, 1916. 11,862,900 17,904,100 63,716,000 207,870,500 Total, 1915. 15,050,800 18,269,700 15,412,000 161,353,000 Percent, 1917.... 29.9 35.7 9.9 100.0 Per cent, 1916.... 5.7 8.6 30.7 Percent, 1915.... 9.3 11.3 9.6 300.0 o Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Paper rediscounted for the Boston Federal Reserve Bank during the month of December, 1917, distributed by maturities. Maturities. Maturities. Rediscounted by Federal Rediscounted by Federal TV Total. Reserve Bank of— Reserve Bank of— 16 to 30 days. 31 to 60 days. 61 to 90 days. 16 to 30 days. 31 to 60 days. 61 to 90 days. New York ... $2,255,372 $13,468.132 $9,461,539 $25,185,043 Dallas $5,000,036 $5,000,036 St. Louis . . .. 5 000 138 5000138 > 5,007,121 5,007,121 Total $2,255,372 $13,4C8,132 29,472,128 i 45,195,632 I"1 Kansas City £,003,294 5,003,294 W W m 1 Figures included with other discounts shown above. o w Member banks' collateral notes discounted by Federal Reserve Banks during the calendar year 1917. H [(a) Secured by Liberty loan bonds or United States certificates of indebtedness; (b) Otherwise secured.] O H January. February. March. April. May. June. July. August. w Federal Reserve Banks. w (b) (b) (b) (b) (a) (b) (a) (b) (a) (b) (b) Boston $448,699 $387,730 $1,423,500 $2,024,000 $40,000 $2,990,000 $413,700 $26,277,500 $1,655,000 $33 150 985 i SM 573 500 $12,673,210 New York 270,000 1,437,000 287,000 1,027,000 40,000 2,037,000 336,696,500 204,393,534 175,869,630 76,785,175 5,011,500 40,053,045 Philadelphia 230,000 475,000 1,605,000 1,307,700 880,000 14,349,000 680,650 35,009,849 1,691,650 16,515,320 2,110,000 10,192,990 Cleveland 1,900,000 1,600,000 4,110,000 550,000 2,170,000 1,957,000 3,827,600 2,210,000 5,081,000 7,025,000 4,339,000 ft Richmond 6,667,000 3,870,000 2,075,000 8,936,000 50,000 19,289,550 66,500 23,938,750 1,379,525 25,534,637 1,926,682 22,428,660 22 Atlanta 769,000 242,356 266,000 735,000 10,000 914,000 35,000 346,000 642,000 632,500 1,006,000 250,000 2 Chicago 520,000 1,911,276 1,130,729 50,000 413,000 1,230,000 6,075,000 7,674,400 3,881,117 18,265,000 3,129,000 7,140,805 St Louis 375,000 365,000 1,670,000 1,377,879 1,520,000 60,000 2,055,000 350,000 10,820,000 1,155,000 8,625,000 Minneapolis 345,000 520,000 100,000 140,000 575,000 300,325 2,243,000 1,078,000 2,090,000 1, 714,151 1,384,640 1,345,804 Wo Kansas City 75,000 10,000 5,000 2,401,000 270,000 4,231,429 5,455,000 2,622,300 11,734,585 3,420,950 13,506,500 > Dallas 162,630 315,000 165,000 170,000 225,000 596,205 1,557,000 305,000 125,000 1,187,500 474,500 1,050,500 S^in Francisco 6 000 400,000 1,115,340 1,261,000 25,000 Total, 1917 9,862,329 11,433,362 10,327,229 19,883,579 5,184,000 45,666,080 354,015,779 310,360,633 192,916,222 202,536,193 30,477,772 121,630,514 Total, 1916 i Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Member banks' collateral notes discounted by the Federal Eeserve Banls during calendar year 1917—Continued, o [(a) Secured by Liberty loan bonds or United States certificates oi indebtedness: (b) Otherwise secured.] September. October. November. .December. Total. Total member banks' Federal Reserve collateral Banks. notes. (a) (b) (a) (b) (a) (b) (a) (b) (a) (b) discounted. > IT1 Boston $2,804,700 $18,193,650 $2,457,700 $3,586,840 $4,916,958 $15,535,000 $10,233,286 $1,134,315 $25,094,844 $117,825,429 $142,920,273 w New York 173,970,000 129,357,497 2,152,680,000 185,687,000 2,398,184,883 213,905,000 102,149, 997 45,637,140 5,344,602,510 900,876,391 6,245,478,901 Philadelphia 5,532,500 10,082,190 3,002,500 8,714,811 9,209,425 7, 755,505 9, 096,501 1,511,250 32,803,226 107, 748,615 140,551,841 O w Cleveland 9,018,000 6,085,000 12,885,000 9,331,500 13,574,250 13,862,000 18,870,300 1,138,000 66,089,550 53,444,100 119,533,650 H Richmond ., 1,952,290 41,738,500 1,449,500 19,745,000 15,280,366 35,195,902 8,209,060 5,291, 713 30,313,923 214, 710, 712 245,024,635 Atlanta 1,749,400 3,261,000 4,744,000 7,683,000 5,289,550 12,298,500 4,923,850 3,282,500 18,399,800 30,679,856 49,079,656 Chicago 7,951,900 16,078,000 44,592,000 31,889,462 78,537,698 45,798,250 45,769,000 59,940,560 190,348,715 191,628,482 381,977,197 H St. Louis 2,711,500 11,125,000 9,411,000 7,875,000 12,971,600 10,948,000 21, 727, 740 3,450,000 48,386,840 60,205,879 108,592,719 M Minneapolis 1,067,000 771,148 5,076,900 12,630,000 2,098,215 2,685,622 588,522 27,752,162 9,001,165 36,753,327 Kansas City 5,556,450 19,767,633 15,864,000 25,452,334 23,113,500. 40,273,404 6,984,350 24,730,287 64,193,979 141,279,743 205,473,722 Dallas 1,842,500 1,788,000 5, 750,250 4, 910,654 5,296,000 5,369,281 1,000,000 1,084,280 16,270,250 17,104,050 33,374,300 San Francisco 1,494,400 305,000 4,562,000 2,850,000 7,059,500 9,004,800 5,127,925 835,000 19,904,825 14,141,140 34,045,965 Total, 1917 215,650,640 25S,552,618 2,262,474,850 307,725,601 2,586,063,730 412,043,857 237,377,631 148,623,567 5,884,160,624 1,858,645,562 7,742,8O6,1S6 Tota^ 1916 . 1,410,850 2,076,302 5,587,895 29,892,400 38,967,447 38,967,447 m Trade acceptances discounted by Federal Reserve Banlcs during each month in 1917, and totals for 1917 and 1916. Fede B ra a l n R k e s s . erve January. February. March. April. May. June. July. August. Se b p e te r. m- October. No b v e e r. m- D b e e c r e . m- Total, 1917. T 1 o 9 t 1 a 6 l . , o w > w Boston $62,433 3410,173 §150,730 $69,926 $526,388 $334,442 $322,992 $638,303 $141,384 $333,710 $436,894 $2,687,752 $6,115,127 $429,200 New York 10,452 1.17,000 358,264 13,000 197,918 161,845 1,121,773 1,102,357 3,781,191 6,863,800 166,600 Philadelphia..... 15,104 21,721 29,730 24,199 25,758 78,343 36,874 94,159 16,289 184,701 100,139 99,001 726,078 74,800 Cleveland 1,797 823 28,564 499,473 66,956 13,332 70,508 601,687 819,959 2,297,491 4,400,590 175,200 Richmond 240,283 145,962 141,466 323,779 305,146 267,503 284,741 91,848 35,926 214,403 544,291 , 565,101 3,160,449 1,509,200 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Atlanta 75,157 227,392 3S8,355 195,600 195,334 | 260,903 61,345 124,285 102,954 417,228 1,350,141 1,163,800 4,562,494 1,591,000 Chicago 8,609 43,387 90,135 34,912 13,653 12,788 226,361 429,845 105'. 200 St. Louis 11,930 22,380 30,276 48,046 414,448 356,345 136,788 66,809 93,137 299,981 651,754 982,609 3,114,503 626,200 Minneapolis 55,678 10,263 49,204 12,238 42,549 1,000 59,819 35,679 97,243 363,, 673 41,700 Kansas City 86,126 305,610 40,990 344,017 442,795 420,776 378,141 627,867 2,6*6,322 190,900 Dallas 94,563 13,465 12,000 9,417 3,016 102 37,528 7,862 177,953 248,900 San Francisco. -. 8,850 14,985 5,197 16,134 8,271 11,446 19,931 46,343 700,669 1,490,099 2,888,373 5,210,298 53,400 % d Total, 1917. 574,464 856,078 762,820 678,022 1,767,702 2,521,374 1,077,607 1,608,063 1,125.834 4,354,747 6,959,770 15,424,651 37,771,132 Total, 1916. 444,400 246,100 298,700 210,000 298,300 275,700 199,000 245,400 593,500 414,900 853,300 1,103,000 5,212,300 o Commodity paper discounted by Federal Reserve Banks during 11 months in 1917,and totals for 1917 and 1916 w H Fede B ra a l n " k R s e . serve January. February. March. April. May. June. July. August. Se b p e te r. m- October. No b v e e r. m- De b c e e r m .! - Total, 1917. T 19 o 1 t 6 a . l, O Boston New York $25,000 $25 000 Philadelphia $25,000 26,200 $25,000 $29,000 105 200 Cleveland 131 360 131 360 Richmond $598,807 $551,076 $635,740 $611,609 $468,420 $209,649 159,289 94,042 $36,678 186,650 134,125 3,686,085 $7,025,800 Atlanta 961,746 249,461 227,190 243,833 249,034 458,873 72,505 11,829 463,463 1,146,633 1,354,252 5,438,819 7,500,400 Chicago St. Louis 15,000 19,000 82,589 310,689 427,278 1,534,000 Minneapolis 21,400 21,400 53,470 25,400 121,670 19.800 Kansas City 131,667 65,000 196,667 360,000 Dallas 4,100 4,775 152,700 104,400 23,921 289,896 225,200 San Francisco 13,569 12,048 1,363 2,180 6,008 218,619 568,509 822,296 148,000 w o Total, 1917.. 1,564,653 814,106 879,753 856,805 864,121 757,102 449,894 320,949 500,141 1,659,491 2,577,256 11,244,271 Total, 1916.. 1,863,600 1,794,700 1,719,000 1,370,700 899,400 712,000 1,525,200 507,500 1,636,300 2,921,100 1,047,000 $816,700 16,813,200 1 Special rate merged with regular discount rate on Dec. 3,1917, and separate classification discontinued. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

104 ANNUAL REPOET OF THE FEDEEAL RESERVE BOARD. Bills, including member banks1 collateral notes, but excluding rediscounts between Federal Reserve Banks, discounted by each Federal Reserve Bank during the calendar year 1917, distributed by States and maturities as of date of discount. Banks Maturities. Districts. o a b M q f t a b t u e e e e n e a a r m n k r c r . d - h s - c q a d o d n e u y u m a a a d a e r t c c i m r a e t - n h t h r d e o g e r - 1 W 5 d it a h y in s. 1 d F 6 a r o y to m s . 30 31 d F a r to o y m s 6 . 0 6 d F 1 a r t o y o m s . 90 90 O d v a e y r s. d T is o c t o al u n bi t l e l d s . 1917. District No. 1—Boston: Connecticut— - Jan.-Mar 55 3 $50,382 $111,790 S2tl,932 $389,773 $793,877 Apr.-June.. 53 6 873,011 345,981 289,084 882,31? 2,390,388 July-Sept... 54 8 2,653,874 578,463 377,300 6S8,397 4,298,024 Oct.-Dec... 55 22 3,547,191 2,878,597 1,734,931 5,420,345 $121,632 13,702,696 Total 7,124,458 3,914,831 2,643,247 7,380,827 121,632; 21,184,995 Maine- Jan.-Mar 66 Apr.-June.. 64 3 225,000 5,000 230,000 July-Sept... 64 84,131 89,488 108,739 88,890 325 371,573 Oct.-Dec... 63 14 226,822 212, 727 246,164 614,048 1,487 1,301,248 Total 535,953 307,215 354,903 702,938 1,812 1,902,811 Massachusetts— Jan.-Mar... 157 21 6,356,069 1,291,888 1,040,994 422,047 9,110,738 Apr.-June .. 154 46 50, 733,451 6,222,184 2,262,925 3,541,009 62, 759,569 July-Sept... 160 60 68,217,769 4, 707,923 5,176,2,50 8,035,478 282,077 86,399,497 Oct.-Dec... 163 87 33,964,96718,394,64625,946,86665,401,458 783,073 145,491,010 Total 159,272,25630,616,44134,427,03578,399,9921,045,150 303,760,874 New Hampshire— Jan.-Mar 56 3 85,000 48,230 18,021 151,251 Apr.-June.. 56 12 450,801 131,688 227,877 19,712 830,078 July-Sept... 55 13 1,100,600 109,883 262,991 181,825 1,655,209 Oct.-Dec... 55 16 944,488 1,064,730 558,259 720,284 13,430 3,301,191 Total 2,580,889 1,306', 3011,097,357 939,842 13, 430 5,937,8:9 Rhode Island— Jan.-Mar 17 1 15,000 15,000 Apr.-June.. 17 2 725,000 725,000 July-Sept... 17 4 510,000 400> 000 910,000 Oct.-Dec... 18 9 1,606,158 1,954,486 2,398,785 5,984,795 11,944,224 Total 2,841,158 2,354,486 2,413,785 5,984,795 13,594,224 Vermont—• Jan.-Mar.... 48 3 55,349 12,313 56,660 34,965 159,2S7 Apr.-Juno.. 48 11 176.128 101,166 203,082 52,985 200 533,541 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

ANNUAL KEPOBT OF THE FEDEBAL EESEBVE BOARD. 105 Bills, including member banks' collateral notes, but excluding rediscounts between Federal Reserve Banks, discounted by each Federal Reserve Bank during the calendar year 1917, distributed by States and maturities as of date of discount—Continued. Maturities. Banks Mem- acber commobanks dated Districts. o a q f t t u e e e a r a n r . c d - h a q d n u e u d a a r c r i t n h t h e g e r 1 W 5 i d t a h y in s. 1 F d 6 a r t o y o m s. 30 3 d F 1 a r o y to m s . 60 6 F d 1 a r o y to m s . 90 90 O d v a e y r s. d T is o c t o a u l n b t i e ll d s . year 1917. District No. 1—Bost on—C ontinue d. Vermont—Con. July-Sept... 48 11 $717,311 $158,710 $162,645 $144,808 $1,183,474 Oet.-Dec... 48 15 882,501 1,108,831 314,043 365,169 113,731 2,662,275 Total 1,811,289 1,379,020 736,410 597,927 13,931 4,538,577 Grand total for Boston 402 218 174,166,00339,878,29441,672,73794,006,3211,195,955 350,919,310 District No. 2—New York: New York- Jan.-Mar. .. 478 20 4,476,128 37,085 370,702 390,936 4,348 5,279,199 Apr.-June .. 477 86 555,447,122 804,386 1,666,814 1,517,885 559,438,207 July-Sept... 484 102 599,653,793 3,683,063 6,123,46114,033,353 7,089 623,500, 759 Oct.-Dec 519 2225,162,573,49811,377,43736,097,00475,908,463 5,285,956,402 Total 6,322,150,54115,901,97144,257, SSI91,850,637 11,4376,474,172,557 New Jersey— Jan.-Mar 132 7 31, 848 61,366 54,101 33,390 1,067 181,772 Apr.-June .. 133 20 800,018 551,010 334,378 619,741 2,305,147 July-Sept... 132 37 8,141,685 504,125 683,687 1,417,700 10,747,197 Oct.-Dec 136 51 11,813,991 598,659 2,466,159 3,553,489 18,430,293 Total 20, 787,542 1,713,160 3;538,325 5,624,320 1,067 31,684.414 Connecticut— Jan.-Mar 15 3 75,200 16,500 27,300 6,125 125,125 Apr.-June .. 15 2 150,000 5,500 29, 700 34,400 219,600 July-Sept... 15 325,085 140,824 90,025 130,602 683,535 Oct.-Dec.... 15 10 1,258,400 152, 733 1,265,023 1,730,522 4,406,678 Total 1,808,685 315,557 1,412,048 1,901,649 5,437,939 Grand total for New York.... 670 3226,344,746,76817,930,68849,208,35499,378,606 12,5046,511,274,920 District No. 3— Philadelphia: Delaware— Jan.-Mar 24 Apr.-June .. 22 July-Sept... 22 ! Oct-Dec..-- 23 1 50,000 50,000 Total 50; 000 50,000 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

106 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. Bills, including member banks' collateral notes, but excluding rediscounts betiveen Federal Reserve Banks, discounted by each Federal Reserve Bank during the calendar year 1917 ^ distributed by States and maturities as of date of discount—Continued. Banks Maturities. Mem- acber commobanks dated Districts. at end during Total bills o q f t u e e a r a . r c - h a q n e u d a a c r t h t h e e r 1 W 5 i d t a h y in s. 1 F d 6 a r t o y o m s 3 . 0 31 F d a r to o y m s 6 . 0 61 d F a r to o y m s 9 . 0 90 O d v a e y r s. discounted. year 1917. District No. 3—Philadelphia—Contd. New Jersey- Jan.-Mar 72 5 $22,927 $144,686 $298,495 $14,973 $511,081 Apr .-June .. 72 20 920,274 197,758 338,958 314,641 $7,500 1,779,131 July-Sept... 17 1,548,940 117,505 224,267 183,830 2,074,542 Oct.-Dec... 73 24 3,712,282 300,258 470,633 422,468 900 4,906,541 Total . 6,204,423 760,207 1,332,353 965,912 8,400 9,271,295 P ennsy 1 vania— Jan.-Mar. .. 53C 24 4,042.669 255,226 254,305 86,170 7,286 4,745,556 Apr.-June .. 534 74 58,607,844 2,897, 769 1,693,860 569,964 6, 796 63,776,233 July-Sept... 533 86 49,084,838 1,218,732 1,690,296 5,175,808 6,084 57,205,758 Oct.-Dec.... 542 152 57,787,563 7,124,639 4,718,96118,733,578 2,425 88,367,166 Total 169,522,914111 - 526.366! 8.457.32224,565,520 22,591 214,094,713 Grand total for Philadelphia. 638 201 175,777,33712,286,573 9, 789,67525,531,432 30,991 223,416,008 District No. 4— Cleveland: Kentucky— Jan.-Mar.. . 68 1 475 1,321 1,796 Apr .-June... 68 2 16,100 48,600 78,269 65,738 208,707 July-Sept... 68 4 49,613 2,000 3,756 50,000 105,369 Oct.-Dec... 70 7 991,472 292,799 232,454 700,636 2,217,361 Tota* 1,057,185 343,874 315,800 816,374 2,533,233 Ohio- i Jan.-Mar 373 12 6,097,854 853,787 173,546 59,406 13,545 7,198,133 Apr.-June... 374 54 16,177,210 1,120,680 1,630, 792 896,137 12,387 19,837,206 July-Sept... 374 39j 26,357,135 4,637,451 2,650,133 2,508,662 10,769 36,164,150 Oct.-Dec... 380 42 60,479,71013,254,74211,440,54713,200,975 10,625 98,386,599 To+al 109 111,90919,866,66015,895,01816,665,180 47,326 161,586,093 P enn syl vani a— Jan.-Mar 299 1 5,000 5,000 Apr.-June... 299 10j 2,026,882 222,362 578,842 206,340 3,034,426 JuJy-Sept... 299 8 7,013,557 8,465 13,819 53,849 614 7,090,304 Oct.-Dec... 301 29 27,011,687 5,510,082 2,053,136 1,630,070 36,204,975 Total 36,052,126 5, 740,909 2,650,797 1,890,259 614 46,334,705 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

ANNUAL KEFOKT OF THE FEDERAL EESERVE BOARD. 107 Bills, including member hanks1 collateral notes, but excluding rediscounts between Federal Reserve Banks, discounted by each Federal Reserve Bank during the calendar year 1917, distributed by States and maturities as of date of discount—Continued. Banks Maturities. Mem- acber commobanks dated Districts. at end during Total bills o q f t u e e a r a r . c - h a q n u e d a a c r t h t h e e r 1 W 5 i d t a h y in s. 1 F d G a r o y to m s . 30 3 F d 1 a r t o y o m s . 60 6 F 1 d a r t o o y m s 9 . 0 90 O d v a e y r s. discounted year 1917. District No. 4— Cleveland—Con. West Virginia— Jan.-Mar ... 13 Apr.-June... 13 July-Sept... 13 1 $11,000 $10,000 $21,000 Oct.-Dec... 13 1 $525,000 $150,000 1,000 5,075 $20,000 701,075 Total 525,000 150,000 12, OOol 15,075 20,000 722,075 Grand total for Cleveland 764 160 146,746,22026,101,44318,873,61519,386,888 67,940 211,176,106 District No. 5—Richmond: District of Columbia— Jan.-Mar 15 200,000 13,912 83,267 151,772 448,951 Apr.-June... 15 4 105,000 70,204 226,750 401,954 July-Sept... 15 3 721,886 100,171 22,000 22,000 866,057 Oct.-Dec... 15 6 376,709 204,056 121,347 133,020 835,132 Total. 1,403,595 388,343 226,614 533.542 2,552,094 Maryland— Jan.-Mar 96 9 1,285,000 32,984 181,051 132,602 1,631,637 Apr.-June... 96 16 13,108,653 245,022 922,054 561,914 400 14,838,043 July-Sept... 95 17 14,214,268 1,306,141 2,192,807 2,354,406 20,067,622 Oct.-Dec 97 31 21,160,115 1,269,064 1,734,053 2,294,309 10,155 26,467,696 Total.. 49,768,036 2,853,211 5,029,965 5,343,231 10,555 63,004,998 North Carolina- Jan.-Mar 81 1,069,040 386,893 507,846 783,539 1,775 2,749,093 Apr.-June... 80 48 1,353,161 418,962 1,272,338 1,533, 798 220,231 4,798,490 July-Sept... 80 47 3,247,231 238,020 1,078,462 1,574,840 99,196 6,297,749 Oct.-Dec.... 81 . 37 5,965,304 566,605 925,904 1,321,449 9,864 S, 789,126 Total 11,634,736 1,670,480 3,784,550 5,213,626 331,066 22,634,458 South Carolina— Jan.-Mar... 80 40 324,287 688,093 1,335,968 1,056,267 89,882 3,492,497 Apr.-June.. 82 53 1,288,085 562,968 1,190,851 1,179,250 586,082 4,807,236 July-Sept... 81 59 3,418,382 502,315 1,384,087 1,612,488 152,913 7,070,185 Oct.-Dec... 84 29 4,828,562 328,378 1,184,957 1,348,724 2,600 7,693,221 Total S,859,316 2,079,754 5,095,863 5,196, 729 831,477 23,063,139 34365°—IS- Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

108 REPORT OF THE FEDERAL RESERVE BOARD. Bills, including member hanks'1 collateral notes, but excluding rediscounts between Federal Reserve Banks, discounted by each Federal Reserve Bank during the calendar year 1917, distributed by States and maturities as of date of discount—Continued. Banks Maturities. ac- Mem- commober dated Districts. o a b q f t t a u e e n e a r a k n . r c d - s h a q d n e u y u d a e a r c i a r n t h t r h e g e r 1 W 5 i d th ay in s 1 F d 6 a r t o y o m s . 30 3 F d 1 a r t o y o m s . 60 6 F d 1 a r t o y o m s . 90 90 O d v a e y r s. d T is o c t o al u n b t i e ll d s . 1917. District No. 5—Richmond—Continued. Virginia- Jan.-Mar 144 16 $9,981,000 $66,395 $94,432 $90,695 $1, 565 $10,234,087 Apr .-June .. 145 46 38,923,591 1,041,024 1,147,352 1,281,447 89,694 42,483,103 July-Sept... 148 47 76,382,679 665,992 1,631,801 1,129,205 30; 680 79,840,357 Oct.-Dec... 151 54 151,292, 744 832,022 1,571,036 1,897,206 500 155,593,503 Total 276,580,014 2,605,433 4,444,621 4,398,553 122,439 28S, 151,060 West Virginia- Jan -Mar 102 1 3,900 3 900 Apr -June 102 1 5,000 5,200 10 200 July-Sept . 102 150,000 38,046 42,007 37,096 207 149 Oct.-Dec.... 102 9 935,454 29,413 40,760 528,060 1, 533, 087 Total 1,085,454 72,459 91,867 565,156 1,814,936 Grand total for Richmond. .. 530 246 350,331,151 9,669,68018,673,48021,250,8371,295,537 401,220,685 District No. G—Atlanta: Alabama— Jan.-Mar 93 20 329,669 37,977 192,207 452,147 22,605 1,034,605 Apr .-June .. 94 26 161,502 189,193 469,507 461,525 234,965 1,516,692 July-Sept... 94 32 602,067 207,787 371,891 402,708 58,256 1,642,709 Oct.-Dec... 95 37 2,559,445 672,465 722,341 920,299 30,989 4,911,539 Total 3,652,683 1,107,422 1,755,946 2,242,679 346,815 9,105,545 Florida— Jan.-Mar 55 9 175,639 46,420 73,874 63,420 5,250 304,603 Apr.-June .. 55 11 470,020 63,700 171,315 93,733 38,444 837,212 July-Sept... 54 19 1,361,755 251,228 452,699 144,258 4,796 2,214,736 Oct.-Dec... 57 30 2,318,194 358,039 940,307 193,104 48, 772 3,858,416 Total...... 4,325,608 719,387 1,638,195 494,515 97,262 7,274,967 Georgia— Jan.-Mar 102 31 528,125 269,243 635,532 942,400 35,749 2,411,049 Apr.-June .. 101 47 1,861,382 520,875 1,261,132 579,574 227,404 4,450,367 July-Sept... 100 54 3,985,049 373,230 1,808,203 801,411 36,216 7,004,109 Oct.-Dec... 107 56 16,585,914 1,843,439 2,956,993 2,084, 795 432 23,471,573 Total 22,9G0,470 3,008,787 6,661,860 4,408,180 299,801 37,337,093 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. 109 Bills, including member banks7 collateral notes, but excluding rediscounts between Federal Reserve Banks, discounted by each Federal Reserve Bank during the calendar year 1917, distributed by States and maturities as of date of discount—Continued. Banks Maturities. Mem- com ac m - ober dated banks during Total bills Districts. at end each From From From discounted. of each quarter Within 16 to 30 31 to 60 61 to 90 Over quar- and the 15 days. days. days. days. 90 days. ter. year 1917. District No. 6—Atlanta—Continued. Louisiana— Jan.-Mar 22 4 $613,350 $40,567 $15,579 $308,760 $10,229 $938,485 Apr.-June .. 22 4 6,500 6,628 8,570 39,647 61,345 July-Sept... 24 12 1,000,500 47,500 39,499 155,930 71,732 1,315,161 Oct.-Dec... 25 7 23, 745,852 174,400 754,185 47,133 24,721,570 Total 25,359,702 268,967 815,891 520,393 121,608 27,038,501 Mississippi— Jan.-Mar 18 1 50,000 50,000 Apr.-June .. 18 3 101,318 13,419 36,255 150,992 July-Sept... 17 7 389,000 31,770 139,137 42,333 4,000 606,240 Oct.-Dec... 18 6 1,307,756 240,437 262,598 17,898 1,828, C89 Total • 1 1,848,074 285,626 437,990 60,231 4,000 2,635,921 Tennessee— Jan.-Mar 92 14 100,100 37,873 91,852 139,860 37,789 407,474 Apr.-June .. 92 22 250,151 163,223 350,970 182,176 32,699 985,219 July-Sept... 92 33 976,653 819,195 1,634,960 902,380 51,700 4,384,833 Oct.-Dec... . 90 40 4,247,915 337,406 703,041 548,231 60,478 5,897,071 Total 5,574,819 1,357,697 2,786,823 1,772,647 182,666 11,674,652 Grand total for Atlanta 392 228 63,721,356 6,745,88614,098,705 9,498,6451,052,152 95,114,744 District No. 7—Chicago: Illinois— Jan.-Mar 316 15 270,517 725,837 335,395 91,318 23,804 1,446,871 Apr.-June .. 315 31 12,784,664 1,041,757 811,603 782,912 66,855 15,487, 791 July-Sept... 323 35 36,039,895 2,811,436 2,199,997 2,383,516 68,631 43,503,475 Oct.-Dec... 334 150 206,803,699 4,399,858 4,610,755 9,799,1341,541,180 227,154,620 Total . 255,898,775 8,978,888 7,957,75013,056,8801,700,470 287,592,703 Indiana— Jan.-Mar 195 12 1,018 19,061 49,142 31,233 48,413 148,807 Apr.-June .. 195 27 2,391,851 263,304 217,270 239,484 118,944 3,230,853 July-Sept... 197 33 1,825,920 517,901 547,990 275", 502 49,845 3,217,158 Oct.-Dec... 200 77 11,284,440 2,728,650 5,279,394 1,881,204 297,203 21,470,951 Total 15,503,229 3,528,916 6,093,798 2,427,423 514,465 23,067,829 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

110 ANNUAL REPORT OF IHE FEDERAL RESERVE BOARD. Bills, including member banks1 collateral notes, but excluding rediscounts between Federal Reserve Banks, discounted by each Federal Reserve Bank during the calendar year 1917, distributed by States and maturities as of date of discount—Continued. Banks Maturities. Mem- acber commobanks dated Districts. o a q f t t u e e e a r a n . r c d - h a q d n u e u d a a r c i r t n t h h e g e r 1 W 5 i d t a h y in s. 1 F d 6 a r t o y o m s . 30 3 F d 1 a r t o y o m s 6 . 0 6 F d 1 a r t o y o m s 9 . 0 90 O d v a e y r s. d T i o sc ta o l u b n i t l e ls d. 1917. District No. 7—Chicago—Continued. Iowa— Jan.-Mar 354 20 $21,480 $46,706 $62,806 $35,956 $69,247 $236,195 Apr.-June .. 354 23 949,596 155,765 205,921 108,287 74,133 1,491,702 July-Sept... 356 62 2,106,323 222,837 782,920 862,083 367,414 4,341,577 Oct.-Dec... 358 189 27,947,661 1,757,289 5,845,098 7,875,6154,428,854 47,854,517 Total 31,025,060 2,182,597 6,895,745 8,879,9414,939,648 53,923,991 Michigan- Jan.-Mar 76 10 3,546,160 117,934 62,584 5,000 15,000 3, 746,678 Apr.-June .. 76 23 5,025,646 432,349 732,366 285,452 62,297 6,533,110 July-Sept... 79 29 15,289,175 3,849,547 1,348,399 1,170,220 66,398 21,723,739 Oct.-Dec 99 44 51,689,363 1,103,494 2,165,665 2,417,608 102,155 57,478,315 Total. 75,550,344 5,503,324 4,309,014 3,878,340 245,850 89,486,872 Wisconsin— Jan Mar 105 2 5 000 2 100 45 735 6 443 59,278 Apr.-June.. 105 14 1,190,050 1,050,700 2,394,059 185,621 32,981 4,853,411 July-Sept... 108 22 5,704,830 2,382,897 7,065,217 404,199 44,469 15, C01,612 Oct.-Dec 109 44 27,489,917 2,694,68310,945,710 987,857 67,147 42,1S5,314 Total 34,384,797 6,133,28020,407,086 1,623,412 151,040 62,699,615 Grand total for Chicago. 1,100 541 412,362,20526,327,00545,664,39129,865,9907, 551,473 521, 771,070 District No. 8—St. Louis: Arkansas- Jan.-Mar 67 5 909,377 3,044 15,392 8,107 17,541 953,461 Apr.-June.. 66 7 33,762 10,307 27,007 77,889 29,362 178,327 July-Sept... 67 20 812,307 144,996 195,851 186,710 79,206 1,419,070 Oct.-Dec 67 13 5,612,229 423,138 981,875 456,610 30,296 7,504,148 Total 7,367,675 581,485, 1,220,125 729,316 156,405 10,055,006 Illinois— Jan.-Mar 157 9 2,500 2,250 27,208 15,768 5,000 52,726 Apr.-June... 157 7 98,179 9,825 89,694 61,225 9,060 267,983 July-Sept... 156 13 64,191 30,214 118, 702 121,398 3,854 338,359 Oct.-Dec 158 17 1,528,250 288,434 585,006 177,710 31,675 2,611,075 Total 1,693,120 330, 723 820,610 376,101 49,589 3, 270,143 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

ANNUAL REPORT OP THE FEDERAL RESERVE BOARD. Ill Bills, including member banks' collateral notes, but excluding rediscounts between Federal Reserve Banks, discounted by each Federal Reserve Bank during the calendar year 1917, distributed by States and maturities as of date of discount—Continued. Banks Maturities. Mem- acber commobanks dated Districts. o a q f t t u e e e a r a n r . c d - h a q d n e u u d a a r c i r n h t t e h g r e 1 W 5 i d th a i y n s. 1 F d 6 a r o t y o m s . 30 3 F d 1 a r o t y o m s . 60 6 F d 1 a r o t y o m s . 90 90 O d ve a r ys. d T i o sc ta o l u b n i t l e l d s . year 1917. District No. 8—St. Louis—Contd. Indiana- Jan.-Mar Cl Apr.-June... 61 3 $125,000 $6,849 $5,403 $.12,500 $149,752 July-Sept... C2 6 1,262,500 136,826 339,904 116,798 1,856,028 Oct.-Dec... 63 12 4,032,000 147,695 392,012 294, 540 4,866,247 Total 5,419,500 291,370 737,319 423.838 6,872,027 Kentucky- Jan. Mar 65 Apr .-June.. 65 4 222,-060 35,000 75,000 332,060 July-Sept... 66 8 1,691,070 433,579 737,668 212,778 3,075,095 Oct.-Dec... 66 17 4,282,941 561,087 1,486,536 933,094 7,263,658 Total.. 6,196,071 994,666 2,259,2041.220.872 10,670,813 Mississippi— Jan.-Mar IS 3 40,000 1,000 8,000 18,100 67,100 Apr .-June.. 17 4 900 4,150 24,650 60,490 $21,086 111,276 July-Sept... 18 6 18,300 7,100 23,430 71,374 2,075 122,279 Oct.-Dec... 18 4 59,600 19,850 97,142 125,062 6,000 307,654 Total.. 118,800 32,100 153,222 275,026 29,161 COS, 309 Missouri- Jan .-Mar W 11 1,125,000 11,119 35,366 96,848 32,685 1,301,018 Apr .-June.. 81 22 6,560,459 1,722,376 1,865,065 2,501,195 54,540 12,703,635 July-Sept... 84 14 37,025,896 3,045,422 3,632,939 3,210,091 28,451 46,942,799 Oct.-Dec... 87 23 58,449,796 6,324,198 4,855,571 4,448,358 48,706 74,126,629 Total.. 103,161,151 11,103,11510,388,94110,256,492 164,382 135,074,081 Tennessee— Jan.-Mar 20 3 385,099 150,967 101,706 637,772 Apr.-June... 20 5 241,230 148,830 188,461 100, 776 2,900 682,197 July-Sept... 20 12 516,807 330,312 656,686 248,763 6,000 1,758,568 Oct.-Dec... 20 6 6,700,236 1,072,649 1,687,342 2,028,509 11,488,736 Total.. 7,843,372 1,702,758 2,634,195 2,378,048 8,900 14,567,273 Grand to-. talforSt.. Louis 479 149 131,799,689 15,036,21718,213,61615,659,693 408,437 181,117,652 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

112 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. Bills, including member banks' collateral notes, but excluding rediscounts between Federal Reserve Banks, discounted by each Federal Reserve Bank during the calendar year 1917, distributed by States and maturities as of date of discount—Continued. Banks Maturities. Mem- acber commobanks dated Districts. o a q f t t u e e e a r a n . r c d - h a q d n e u u a d a r c i r n t h t h e g e r 1 W 5 i d t a h y in s. 1 F d 6 a r t o y o m s 3 . 0 3 F d 1 a r t o y o m s . 60 6 F d 1 a r t o y o m s . 90 90 O d v a e y r s. d T is o c t o al u n b t il e l d s . year i917. District No. 9— Minneapolis: Michigan— Jan.-Mar 32 2 $2,081 $2,388 $17,505 $3,289 825,203 Apr .-June.. 32 4 24,500 31,732 6,468 10,156 72,856 July-Sept... 33 3 39,639 15,000 29,639 5,082 89,3G0 Oct.-Dec... 34 8 85,301 30,301 114,098 04,643 294,343 Total . .. 151,521 79,421 167,710 83,170 4 V 822 Minnesota— Jan.-Mar 289 18 1,014,028 569,929 1,064,107 160,625 $36,050 2, 894, 739 Apr.-June.. 291 37 5,012,122 2,008,665 6,032,198 2, 239,835 46G, 198 15,759,013 July-Sept... 293 71 8,822,718 1,850,283 5,590,388 3, 730,887 999, 410 20,993,686 Oct.-Dec 295 92 22,895,550 1,274,862 3,309,507 2, 534,989 572,642 30, 587, 550 Total 37,744,418 5,703,73915,996,200 8,666,336 2,121,300 70,234,993 North Dakota— Jan.-Mar 156 11 35,000 14,525 18,061 44,490 24,302 136,37S Apr .-June.. 156 32 26,971 10,343 52,750 859,965 950,029 July-Sept... 157 51 106,207 59,460 342,492 359,716 261,188 1,129,033 Oct.-Dec... 162 40 144,651 57,501 53,772 229,415 359,804 845,143 Total 285,858 158,457 424,668 686,371'1,505,259 3,060,613 South Dakota— Jan.-Mar 125 8 1,998 26,550 20,118 70,625 119,291 Apr.-June.. 126 18 1,510 16,553 272,340 290,403 July-Sept... 127 26 37,475 10,516 52,511 93,514 121,023 315,039 Oct.-Dec... . 128 30 499,966 79,527 478,948 414,991 159,760 1, 633,192 Total 537,441 92,041 559,519 545.176 623, 748 2,357,925 i Montana- Jan.-Mar 86 3 14,295 8,787 18,788 41,870 Apr.-June.. 94 17 230,000 5,000 42,716 7,550 219,700 504,9C6 July-Sept... 108 33 355,000 7,943 71,373 245,073 369,347 1,018, 73G Oct.-Dec... 115 45 46,861 127,866 233,040 168,837 643,011 1,219,615 Total.. . 115 631,861 150,809 361,424 430,2471,250,846 2,815,187 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

ANNUAL EEPOBT OP THE FEKEKAL RESEBVE BOAEB. 113 Bills, including member banks' collateral notes, but excluding rediscounts betvjeen Federal Reserve Banks, discounted by each Federal Reserve Bank during the calendar year 1917 y distributed by States and maturities as of date of discount—Continued. Banks Maturities. Districts. o a b M q f t t a b u e e n e e e a r m a n k r r . c d - s - h a d q o d n e y u u m a a a d e r a c t c i e a r m - n t h t d r h e g o e r 1 W 5 i d th a i y n s. 1 F d 0 a r t o o y m s 3 . 0 3 F 1 d a r t o o y m s G . O 61 F d a r to o y m s 9 . 0 90 O d ve a r ys. d T is o c t o al u n b t i e ll d s . 1917. District No. 9— Minneapolis- Continued. Wisconsin— Jan.-Mar 37 2 $5,000 $1,401 $6,401 Apr.-June.. 37 8,120 $30,675 56,382 $88,276 1S3,453 July-Sept... 37 10 26,505 89,002 219,927 259,062 $22,153 616,649 Oct.-Dec... 38 10 243,663 14,137 41,509 92,859 5,505 397,673 Total 283,288 133,814 319,219 440,1^7 27,658 1,204,170 Grand total for Minneapolis... 773 284 39,634,387 6,308,28117,828,74010,851,4975,531,811 80,154,71(5 District No. 10— Kansas City: Colorado- Jan.-Mar... 122 1,621 1,439 1,768 4,823 Apr .-June.. 12 31,572 2,277 4,557 25,903 64,309 July-Sept.. 122 1 470,000 5,785 48,227 43,877 147,986 715,875 Oct.-Dec... 122 1 2,908,440 421,998 590,457 1,108,6721,165,645 6,195,212 Total 3,410,012 427,783 642,582 1,158,5451,341,302 6,980,224 Kansas— Jan.-Mar... 22- 60,223 139,102 28,742 6,977 58,280 293,324 Apr.-June. 226 2 484,691 152,138 81,948 94,79 269,472 1,083,046 July-Sept.. 23 3 1,057,878 483,448 361,850 97,02 81,878 2,082,075 Oct.-Dec... 23o 3 4,947,561 211,884 235,644 428,175 255,601 6,078,805 Total . . 6,550,353 986,572 708,184 626,970 665,231 9,537,310 Missouri- Jan.-Mar 5 3 606 1,282 4,552 8,40 28,225 43,073 Apr.-June.. 5 S 9,809,175 356,232 339,407 52,29 8,565 10,565,675 July-Sept... 5 14 43,685,575 130,00 183,235 67,01 575 44,066,397 Oct.-Dec.... 5 V, 79,386,283 381,695 505,390 416,02 38,936 80,728,331 Total 132,881,639 869,20 1,032,584 543,74 76,301 135,403,476 Nebraska- Jan.-Mar 19 2,95 10,264 30,60 8,258 52,080 Apr.-June.. 19 41 425,00C 15,00 18,851 7,51 7,082 473,448 July-Sept... 19 ) 6,708,30C 272,62 243,094 131,32 336,539 7,691,880 Oct.-Dec... 19 6 44,850,16. 1,542,21 2,396,145 1,993,23 1,121,021 51,902,781 Total 51,983,465 1,832,79 2,668,354 2,162,67 1,472,90C 60,120,189 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

114 ANNUAL EEPOKT OF THE FEDERAL RESERVE BOARD. Bills, including member banks' collateral notes, but excluding rediscounts between Federal Reserve Banks, discounted by each Federal Reserve Bank during the calendar year 1917, distributed by States and maturities as of date of discount—Continued. Banks Maturities. Mem- acber commobanks dated Districts. at end during Total bills o q f t u e e a r a . r c - h a q n e u d a a c r t h t h e e r 1 W 5 i d th a i y n s. 1 F d 6 a r t o o y m s 3 . 0 31 F d a r t o o y m s 6 . 0 61 F d a r t o o y m s 9 . 0 90 O d v a e y r s. discounted. year 1917. District No. 10— Kansas City- Continued. New Mexico— Jan .-Mar 9 1 $6,252 $13,877 $20,129 Apr.-June.. 9 4 $19,959 $9,262 78,681 79,865 187,767 July-Sept... 9 4 17, 711 31,067 70,685 119,463 Oct.-Dec.... 9 2 9,512 2,028 49,050 60,590 1 1 Total ... 19,959 36,485 118,028 217,977 387,949 Oklahoma- Jan.-Mar ,303 15 $85,000 20,199 56,431 51,367 135,970 348,967 Apr.-June.. 305 56 1,941,233 168,814 684,558 668,103 549,327 4,012,035 July-Sept... 308 89 5,795,452 434,196 1,401,599 1,148,191 359,521 9,138,959 Oct.-Dec-... 311 45 7,241,539 814,254 1,483,006 1,259,215 653,167 11,451,181 Total 15,063,224 1,437,463 3,625,594 3,126,8761,697,985 24,951,142 Wyoming— Jan .-Mar 36 Apr .-June -. 36 1 16,000 20,500 36,500 July-Sept... 36 3 12,000 2,200 11,500 5,850 23,410 54,960 Oct.-Dec 36 4 1,342 10,000 114,255 93,421 219,018 Total. . 12,000 3,542 21,500 136,105 137.331 310,478 Grand total for Kansas City... 958 209,900,693 5,577,321 8,735,283 7,872,9445,604,527 237,690, 768 District No. 11— Dallas: Arizona— Jan. -Mar... 6 Apr .-Jane.. 6 1 24,886 13,373 18,160 56,419 July-Sept.. Oct.-Dec... 1 998 8,745 14,855 82,539 107,137 Total 998 33,631 28,228 100,69S 163,556 Louisiana- 1*> Apr .-June... 15I 1 85c 3,02.: l,00C 17,07 21,958 July-Sept... 15I 1 6,75C 32,92- 10,53S 3,28 53,488 Oct.-Dec... . 15J 5 225, (XX 94,49C 319,493 Total 225, (MX) 102,09*I 35,94< 11,531) 20,35 394,939 i Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

ANNUAL EEPOET OF THE FEDERAL EESEEVE BOARD. 115 Bills, including member banks' collateral notes, but excluding rediscounts between Federal Reserve Banks, discounted by each Federal Reserve Bank during the calendar year 1917, distributed by States and maturities as of date of discount—Continued. Maturities. Banks Mem- ac- Districts. o a b f t a b e n e e a n r k c d s h c q d d o e u u a m a a r t c i r m e n h t d e g o r - Within 1 F 6 r t o o m 30 31 F r to o m 60 61 F r t o o m 90 Over d T is o c t o a u l b n i t l e l d s . q t u e a r. r- an y d e a t r he 15 days. days. days. days. 09 days. 1917. District No. 11— Dallas—Contd. New Mexico- Jan .-Mar 28 5 $43,810 $92,485 $27,517 $137,573 $301,385 Apr .-June. . 30 11 $102,673 30,990 322,653 134,779 214,295 805,390 July-Sept... 31 9 160,000 9,590 500,254 113,781 318,214 1,101,839 Oct.-Dec... 32 11 180,000 53,452 288,094 258,685 492,829 1,273,060 Total 442,673 137,842 1,203,486 534, 7621,162,911 3,481,674 Oklahoma— Jan.-Mar 32 1 1,373 3,230 4,603 Apr .-June... 32 8 30,000 21,000 32,140 9,033 154,816 246,989 July-Sept... 31 8 45,000 9,015 41,554 78,246 22,047 195,862 Oct. Dec... 30 4 295,000 295,000 Total 370,000 30,015 75,067 87,279 180,093 742,454 Texas- Jan .-Mar 541 50 662,016 71,142 433,232 454,250 485,011 2,105,651 Apr .-June... 546 105 2,862,346 426,349 1,242,971 940,0651,306,350 6,778,081 July-Sept... 551 151 6,413,891 407,0732,006,783 2,373,5991,077,258 12,278,604 Oct.-Dec... 551 88 23,081,853 449,168 1,109,337 673,391 793,892 26,107,641 Total. 33,020,106 1,353,732 4,792,323 4,441,3053,662,511 47,269,977 Grand total for Dallas... 632 258 34,057,779 1,624,685 6,140,456 5,103,1075,126,573 52,052,600 District No. 12— San Francisco: Alaska- Jan .-Mar . 1 Apr.-June 1 July-Sept... 1 Oet.-Dec 1 Total Arizona— Jan.-Mar 6 Apr.-June.. j July-Sept... I I Oct.-Dec... Total.. . Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

116 AKKUAL REPORT OF THE FEDERAL RESERVE BOARD. Bills, including member banks' collateral notes, but excluding rediscounts between Federal Reserve Banks, discounted by each Federal Reserve Bank during the calendar year 1917, distributed by States and maturities as of date of discount—Continued. Banks Maturities. Mem- acber commobanks dated Districts. o a q f t t u e e e a r a n . r c d - h a q d n e u u d a a r c i r t h n t h e g e r 1 W 5 i d th ay in s. 1 F d 6 a r t o y o m s 3 . 0 31 F d a r t o o y m s 6 . 0 61 F d a r t o y o m s 9 . 0 90 O d v a e y r s. d T is o c t o al u n b t i e ll d s . year 1917. District No. 12—San Francisco—Contd. California— Jan.-Mar 263 13 $5,445 $22,129 $104,181 $118,607 $43,895 $294,257 Apr .-June... 271 33 468,641 2,552,382 2,756,349 2,857,077 93,054 8, 727,503 July-Sept... 271 43 5,421,162 2,567,746 3,626,747 2,159,810 141,246 13,916,711 Oct.-Dec... 272 48 28,558,195 5,158,92110,431,912 7,818,369 102,839 52,070,236 Total 34,453.44310,301,17816,919,18912,953,863 381,034 75,008,707 Idaho— Jan.-Mar 57 3 3,578 20,941 26, 700 51,219 Apr .-June.. 61 4 12,646 1,025 9,625 7,650 35,484 66,430 July-Sept... 63 14 157,000 8,817 93,682 183,739 119,262 562,500 Oct. Dec... 65 14 293,000 37,422 149,945 222,159 206,891 909,417 Total 462,646 50,842 253,252 434,489 388,337 1,589,566 Nevada— Jan.-Mar 10 Apr .-June... 10 1 30,000 20,000 50,000 July-Sept... 10 Oct.-Dec... 10 1 20,000 50,000 25,000 95,000 Total 30,000 40,000 50,000 25,000 145,000 Oregon— Jan.-Mar 81 3 25,000 2,890 4,660 3,640 36,190 Apr .-June... 82 106,834 237,840 274,576 230,589 11,258 861,097 July-Sept... 82 9 170,000 2,027 42,090 190,805 26,613 431,535 Oct.-Dec... 85 18 4,379,675 1,325,764 2,232, 208 1,252,856 31,221 9, 221,724 Total.. 4,681,509 1,565,631 2,551,764 1,678,910 72,732 10,550,546 Utah— Jan-Mar 23 Apr .-June.. „ 24 c 19,370 24,154 192,128 260,000 8,112 503, 764 July-Sept... 24 9 492,080 58,075 114,261 299,710 39,895 1,004,021 Oct.-Dec... 24 10 1,722,437 256,877 315,439 639,220 82,339 3,016,312 Total 2,233,887 339,106 621,828 1,198,930 130,346 4,524,097 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

ANNUAL REPORT OP THE FEDERAL RESERVE BOARD. 117 Bills, including member banks' collateral notes, but excluding rediscounts between Federal Reserve Banks, discounted by each Federal Reserve Bank during the calendar year 1917, distributed by States and maturities as of date of discount—Continued. Banks Maturities. Mem- acber commobanks dated Districts. o a qf t t e e ra n c d h a q d n e u u d a a r c i r t n h t h e g e r 1 W 5 i d t a h y in s. 1 F d 6 a r t o y o m s . 30 31 d F a r t o o y m s. 60 61 F d a r t o o y m s. 90 90 O d v a e y r s. d T is o c t o al u n b t i e ll d s . year 1917. District No. 12—San Francisco—Contd. Washington- Jan .-Mar.... 77 Apr .-June... 78 2 $385 $4,404 $4,789 July-Sept... 81 32 $1,955,256 $376,347 $940,530 699,475 267,876 4,239,484 Oet.-Dec... 83 19 2,124,532 869,488 2,265,589 1,651,088 8,320 6,919,017 Total 4,079,788 1,245,835 3, 206,119 2,350,948 280,600 11. 183.23(1 Grand total for S an F r a n - Cisco 547 156 45,941,27313,542, 59223,602,15218,642,1401,253,049 102,931,200 EECAPITULATION. No. 1.—Boston 402 218 174,166,003 39,878,294 41 672,737 94,006,321 1,195,955 350, 919,310 No. 2.—New York.. 670 322 6,344, 746,768 17,930, 208,354 99,376, 606 12,504 6,511,274,920 No. 3.—Philadelphia 638 201 175,777,337 12,286i,,573 789, 675 25,531,432 30,991 223,416,003 No. 4.—Cleveland... 764 160 146, 746,220 26,101 443 18,873,615 386, 67,940 211,176,106 No. 5.—Richmond... 530 246 350,331, 9,669,680 18,673,480 250,837 1,295,537 401,220,685 No. 6.—Atlanta 392 228 63, 721, 6, 745,886 14,096, 705 498,645 1,052,152 95,114, 744 No. 7—Chicago 1,100 541 412,463,238 26,327,005 45,664,391 29,865,996 7,551,473 521,872,103 No. 8.—St. Louis 479 149 131, 799,689 15,036,2118,213,616 15,659, 693 408,437 181,117,652 No. 9.—Minneapolis. 773 284 39,634, 6,308,281 17,828,740 10,851,497 5,531,811 80,154,71G No. 10.—Kansas City 958 364 209,900, 5, 577,321 735,283 872,944 5,604,527 237,690,788 No. 11.—Dallas 632 258 34, 057, 1,624,6856,140,456 103,107 5,126,573 52,052,600 No. 12.—San Francisco 547 156 45,941,273 13.542,592 3,602,152 18, 642,140 1,253,049 102,981,206 Total for calendar year 1917 7,885 3,127 8,129, 285,894 181,023,665 272,499,204 357,046,106 29,130,949 8,988,990,818 Per cent 90.6' 2.0 3.1 4.0 0.3 Total for 1916. 7,627 1,788 115,053,100 34,422,900 41,576, 600 16,817,900 207,870,500 Total for 1915. 7,648 1,920 28,509,200 57,837,400 57,322,40019,684,000 161,353,000 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Number of banks, by districts, accommodated through the discount of paper during each month in 1917. 00 u J a a r n y - . F a e r b y r . u- March. April. May. June. July. August. Se b p e te r. m- October. No b v e e r. m- De b c e e r. m- T .1 o 9 t 1 a 7 l . , T 1 o 91 ta 6 l . , Boston 17 15 20 17 28 76 69 63 71 65 127 138 218 56 New York 11 16 17 21 38 98 103 92 98 89 175 237 322 62 Philadelphia 14 18 17 16 43 79 64 67 76 79 116 139 201 143 Cleveland 12 6 8 17 16 33 25 30 22 35 102 111 160 50 Richmond . .. 60 68 76 89 115 133 137 132 101 79 102 127 246 202 Atlanta . .. 56 47 55 56 80 82 87 126 122 151 133 117 228 209 o Chicago - - 37 16 33 38 48 85 91 77 127 222 297 373 541 212 St Louis 15 11 19 24 30 33 44 40 61 69 78 92 149 114 H Minneapolis 30 16 13 31 48 83 110 109 54 59 108 123 284 174 O Kansas City 19 12 18 21 55 71 85 98 87 182 115 112 364 189 Pallas 24 28 31 39 71 8-5 98 102 83 69 61 48 301 San Francisco 14 9 8 15 18 42 47 54 51 41 60 84 156 76 Total number of member banks accommodated: 1917 309 262 315 384 590 900 960 990 953 1,140 1,574 1,701 3 127 1916 . .. . . 614 451 535 606 655 678 642 483 448 383 336 314 1 788 Total number of member banks: 1917 7,624 7,635 7,633 7,643 7,659 7,676 7,700 7,733 7,748 7,783 7,847 .7,885 w 1916 7,649 7,643 7,639 7,631 7,606 7,621 7,621 7,618 7,624 7,626 7,628 7,627 IP w w o > fcd o Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Acceptances bought in open market and from other Federal Reserve Banks during each month in 1917, 1916, and 1915. Federal Reserve Bank. January. February. March. April. May. June. July. August. September. Boston $3,038,839 $5,262,222 $5,157,262 $1,245,087 $10,217,813 $8,543,882 $3,403,446 $7,551,527 $16,633,620 New York 2,605,561 20,242,315 1,763,414 9,687,415 28,839,605 83,248,508 25,012,534 12,512,825 62,434,840 Philadelphia... 2,107,327 10,058,886 4,610,296 5,208,807 5,404,559 3,441,475 11,472,425 7,450,793 6,05G, 282 Cleveland 1,351,779 6,185,295 1,037,722 2,888,038 7,428,129 3,082,041 5,681,887 14,531,566 9,855,782 Richmond 2,485,360 6,206,566 3,653,874 5,685,718 3,873,881 4,288,803 3,869,332 1,490,697 3,025,707 w Atlanta 1,741,822 944,791 2,032,077 1,158,047 1,218,040 1,442,268 515,469 1,859,728 1,533,923 ft Chicago 1,010,250 6,701,460 3,160,135 2,887,501 11,018,641 19,041,205 6,094,057 5,693,449 1,924,933 o St. Louis 1,283,005 4,653,124 601,545 1,671,672 4,524,450 993,134 1,285,644 3,735,083 322,696 w Minneapolis 1,421,725 2,543,352 2,702,961 5,564,080 951,049 632,000 13,000 3,109,666 95,079 Kansas City 385,388 2,684,869 145,390 745,305 3,814,032 7,865,082 3,267,191 2,842,465 9,117 O Dallas 307,374 1,665,676 44,458 363,128 573,090 2,617,976 1,510,357 4,225,754 San Francisco.. 2,878,750 3,492,123 3,243,504 4,147,293 4,081,083 2,651,299 3,631,104 9,834,646 2,928,733 Total 20,617,180 70,640,679 28,152,638 41,312,691 82,544,372 135,229,697 66,864,065 72,122,802 109,046,466 ft Percent 1.9 6.6 2.6 3.8 7.7 12.5 6.2 6.7 10.1 W Total, 1916.. 9,603,000 12,416,000 22,918,000 18,499,000 21,912,000 42,325,000 36,575,000 28,447,000 37,087,000 ft Per cent 2.5 3.2 5.9 4.8 5.7 11.0 9.5 7.4 9.6 Total, 1915.. 2,666,000 8,356,000 4,018,000 2,865,000 4,701,000 5,986,000 4,656,000 4,548,000 Percent 4.1 12.9 6.2 4.4 7.3 7.2 7.0 ft m ft w o >> o Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Acceptances bought in open market and from oilier Federal Reserve Banks during each month in 1917, 1916, and 1915—Continued. to o Per cent. Federal Reserve Bank. October. November. December. Total, 1917. Total, 1916. Total, 1915. 1917 1916 1915 Boston $5,640,728 $11,836,348 $12,997,431 $91,528,205 $52,377,000 $14,105,000 8.5 13.6 21.7 New York 50,307,095 61,395,916 106,915,574 464,965,602 123,406,000 25,834,000 42.9 32.0 39.8 Philadelphia.... 4565,180 19,479,626 5,998,142 85,913,798 53,122,000 7,565,000 7.9 13.8 11.7 Cleveland 7,361,666 22,997,670 8,707,012 91,109,193 27,542,000 2,963,000 8.4 7.1 4.6 Richmond 5.620,717 10,465,939 7,449,467 58,116,061 11,313,000 250,000 5.4 2.9 .4 o Atlanta 3,470,559 4,645,617 5,830,223 26,392,564 12,544,000 72,000 2.4 3.2 .1 H Chicago 3,181,598 1,046,114 4,954,717 60,714,061 27,061,000 5,782,000 6.2 7.0 St. Louis 173,796 7,777,937 2,710,185 29,732,271 20,681,000 1,801,000 2.7 5.4 Minneapolis 536,000 10,077,199 5,426,206 33,072,316 13,539,000 1,455,000 3.1 3.5 2.2 Kansas City 30,535 5,019,267 16,772 26,825,413 8,191,000 1,788,000 2.5 2.1 Dallas 900,497 14,009,013 4,799,594 35,076,917 3,543,000 3.2 .9 San Francisco..., 105,811 17,408,076 12,203,686 68,260,108 32,776,000 3,230,000 6.8 8.5 5.0 Total 86,894,182 186,218,728 178,009,009 1,077,712,509 Percent 8.1 17.3 16.5 100.0 Total, 1916 40,895,000 48,547,000 66,871,000 386,095,000 Percent 10.6 12.5 17.3 100.0 Total, 1915. 6,340,000 7,919,000 12,790,000 64,845,000 Percent 12.2 19.7 o Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Acceptances bought in open market during each month in 1917, distributed by maturities MATURITIES. Month. Within 15 days. 30 From 31 to 60 From 61 to 90 Over 90 days Total. days. days. January..... $177,411 $1,742,999 $2,871,844 $14,647,328 $1,177,598 $20,617,180 February.. 1,368,786 8,549,128 21,438,280 38,459,632 824,853 70,640,679 March 85,221 8,466,068 5,733,322 11,746,055 2,121,972 28,152,638 April 1,787,866 8.335,122 13,953,959 16,355,820 879,924 41,312,691 May 2,755,184 9.585,123 17,226,847 43,938,859 9,038,359 82,544,372 Tune 7,648,046 15,738,784 29,561,285 70,711,531 5,570,051 135,229,697 On July 1,617,112 5,223,829 10,001,985 44,500,009 5,521,130 66,864,065 August 3,627,609 7,620,821 19,060,672 40,943,315 870,385 72,122,802 September. 1,121,029 11,403,123 25,096,852 67,230,371 4,195,091 109,046,466 October 1,473,265 10,670,004 17,790,456 54,414,621 2,545,836 86,894,182 November. 4,679,280 26,514,207 62,133,013 92,045,346 846,882 186,218,728 3 December.. 5,707,389 15,043,930 42,166,367 112,302,369 2,848,954 178,069,009 Total 32,048,198 128,893,138 267,034,882 613,295,256 36,441,035 1,077,712,5 Acceptances sold by the Boston and New York Federal Reserve Banks to other Reserve Banks during the calendar year 1917. Sold by Federal Reserve Bank Sold by Federal Reserve Bank of— of— Purchased by Federal Reserve Bank Purchased by Federal Reserve Bank of— Total. of— Total. Boston. New York. Boston. New York. < Boston $5,046,527 $5,040,527 St. Louis , $2,254,577 $4,689,818 $6,944,395 New York $19,659,207 19,659,207 Minneapolis 0,754,814 9,919,972 16,674,786 W Philadelphia 2,820,989 12,383,051 15,204,040 Kansas City.... 4,260,291 5,003,971 9,264,262 O Cleveland 12,526,185 27,575, SGS 40,102,053 Dallas 739,384 24,594,028 25,333,412 Richmond 3,356,984 3,356,984 San Francisco.. 10,326,860 9,921,757 20,248,617 Atlanta 1,005,047 1,005,047 Chicago 5, 572,190 Total. 64,914,497 103,497,023 U68,411,520 1 Figures included with acceptances purchased as shown above. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Amounts of United States bonds and one-year Treasury notes (par value) purchased by Federal Reserve Banks during each month in 1917. Per cent. Federal Reserve Bank. January. Fe a b ry ru . - Maxell. April. May. June. July. August. Se b p e te r. m- O b c e t r o . - No b v e e r. m- De b c e e r m . - T 19 o 1 t 7 a . l, T 1 o 91 ta 6 l . , 1917 1916 Boston $1,057,750 $1,900 $80,000 i $276,346 $2,120 418, 11612,332,000 1.6 New York $72,500 $57,500 4,022,000 750,000 $1,500,000 $53,650 380,000 325,000 3,122,950 883, 7,818,750 12.3 13.8 Philadelphia 1,098,260 317,700 10,200 10,848,050 274, 2,500,000 13.9 4.4 Cleveland» 26,400 !, 490,500 15,000 1,059,000 2,000,000 29,600 408,200 756,000 1,000 785, 8,403,160 7.7 14.8 Richmond 46,250 458,000 710,500 40,200 9,000 134,600 152,050 42,900 593, 4,335,250 1.8 7.6 Atlanta 525,000 470,000 505,000 26,700 1,100 4,000 192,150 2,450 9,100 6,539,400 274, 2,595,500 9.3 4.6 Chicago 1,461,500 l,192,55i00166,,991188,,6001,383,560 20,404,600 9,000 10,000 379, 8,644,100 46.7 15.2 St. Louis 583,500 8,000 57,800 750 650, 2,419,000 0.7 4.4 Minneapolis 1,240 25,450 45,010 511,000 $2,000 2,000 1,000 27,950 615. 2,552,920 0. 4.5 Kansas City 25,000 1,094,740 50,000 7,500 10,000 187, 8,362,500 1.3 14.7 Dallas 562,750 3,400 825,000 394, 4,163,250 1.6 7.3 San Francisco 1,735,000 60,000 190,650 130,700 10,750 500 15,000 142, 2,623,750 2.4 4.6 Total, 1917 2,431,390 600,99550 10,522,510 ;, 090,040 52,000 1,997,900 19,736,650 3,825,460 200,,883300,,i650 1,.559,400U,546,946 21,406,420 18,600,316 Percent 2.7 0.7 11.9 4.6 0.1 2.2 22.2 4.3 23. 1.8 1.7 24.2 . 1100.0 Total, 1910. 6,627,180 9,496,750 5,249,85010,479,600 ,113,6001,322,440 341,250 501,100 2,193,300 257,060 5,628,300 5,539,750 56,750,180 Per cent 11.7 16. 14.5 18. 10.8 2.3 0.6 0.9 3.9 0.4 9.8 100.0 Classes of securities purchased each month: 2 per cent bonds 2,370,150 144,500 8,565,51G 2,867,040 50,000 13,997,200 48,12S, 100 15.8 84.8 3 per cent bonds 61,240 200 50,000 3,000 2,000 67,000 3,100 2,000 188,540 3,918,880 0.2 6.9 3£ per cent bonds 1,232,900:18,299,650 3,825,460 20,830,650 157,650 250,550 1,265,750 45,862,610 51 4 per cent bonds 250 25,000 9,1 29,650 1,294,396 20),, 130,670 21,488,966 4,403,200 24.2 7.8 1 year Treasury notes. 456,000 1,882,000 1,220,000 756,000 1,370,000 1,369,000 10,000 7,0C3,000 300,000 8.0 0.5 Total, 1917 2,431,390 600,950101,,522,510 4,090,040 52,000 1,997,900 19,736,650 3;,, 825,460 201,,830,650 1'.., 559,40011,546,946 21,406,420 88,600,316 100.0 Total, 1916 6,627,180 9,,496,750 8,249,850 101,,479,6006,113, OOOil, 322,440 341,250 501,100 2,193,300 257,060 5,628,300 5,539,750 56. 750,180 100.0 1 Includes partia payments on Liberty loan bonds sold to individual subscribers. 2 Figures are exclusive of $58,000 of 1-year Treasury notes received from the Secretary of the Treasury in exchange for a like amount of matured notes held by the bank and of $83,700 of coupon bonds exchanged for registered bonds, both of which amounts are included in the Cleveland report. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Amounts of United States bonds and one-year Treasury notes sold by Federal Reserve Banks during each month in 1917. co - § Federal Reserve Bank. January. February. March. April. May. June. July. August. September. October. November. December. Total. o *n Boston $556,000 $110,000 i$380 i$304 i$304 i$198 i $3,219 i $156,969 i $827,374 1 New York . . 1,495,000 86,000 $695,000 $30,000 1,650 30,900 414,720 474,480 223,550 3,451,300 PhiladelDhia . 690,000 136,000 315,000 11,800 5,296,500 5,449,300 Cleveland 1,014,100 187,000 530,000 1,056,100 3,250 458,050 27,650 3,276,150 Richmond 753,000 603,100 40,000 100,700 70,700 83,000 1,650,500 Atlanta 1,213,000 655,000 3,000 $100 3,850 5,400 1,000 5,039,550 6,920,900 Chicago . 1,168,000 284,000 152,000 241,000 $780,000 12,366,260 994,600 10,634,400 750,000 7,000,000 7,000,000 41,370,260 St. Louis 34,200 25,000 5,000 2,350 66,550 Minneapolis... 424,000 106,000 530,000 Kansas City 7,450 2,550 10,000 Dallas 200,000 1,000 400 300,700 502,100 San Francisco 1 000 000 164,650 6,700 150,000 1,321,350 Total sales - 8,313,100 2,367,100 1,377,000 1,330,100 100 780,000 12,565,490 1,069,254 11,139,454 1,296,268 18,009,999 17,127,919 165,375,784 2 per cent 25,000 25,000 3 Der cent. . 7,288,100 1,561,100 3,100 100 2 000 8,854,400 3| percent 780,000 12,565,490 1,068,254 11,139,454 1,295,218 7,726,706 7,674,838 42,249,900 4 per cent 1,050 1231,293 9,453,081 i 9,685,424 1-year Treasury notes 1,000,000 806,000 1,377,000 1,327,000 1,000 50,000 4,561,000 Total 8,313,100 2,367,100 1,377,000 1,330,100 100 780,000 12,565,490 1,069,254 11,139,454 1,296,268 18,009,999 17,127,919 165,375,784 W o i Includes partial payments on Liberty loan bonds sold to individual subscribers. to CO Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

United States bonds and 1-year Treasury notes held by each Federal Reserve Bank on Jan. 1, 1917, purchases and sales during the year, and amounts on hand Jan. 1> 1918; also conversion operations of each Federal Reserve Bank during the year. to Boston. Y N o e r w k. d P el h p i h la i - a. C la le n v d e . - m R o ic n h d - . Atlanta. Chicago. St. Louis. M ap i o n l n is e . - K C a i n t s y a . s Dallas. Sa c n is F c r o a . n- Total. Balance on hand Jan» 1,1917: > United States bonds $1,332,00011.., 042,550 $1.,651,000 $77,,336611,,460 $2!,, 192,450 $1,,710,000 $85,,858,100 $2,202,900 $2!., 442,340 $8!;,492,850$44,,332288,,250$21:,633,750 $44,,247,650 1-year Treasury notes 1,000,000 1,205,000 1,174,000 618,Q00 1,070,000 824,000 1,517,000 891,000 700,000 963,000 705,000 500,000 11,167,000 Total 2,332,000 2,247,550 2,825,000 7,979,460 3,262,450 2,534,00010,375,100 3,093,900 3,142,340 9,455,850 5,033,250 3,133,750 55,414,650 s Purchases during year: United States bonds 1 1,418,116 7,646,60012,274,250 4,159,700 1,137,500 7,924,900 40985,760 650,050 615,650 1,187,240 1,394,950 2,142,600 81,537,316 1-year Treasury notes 3,237,000 2,626,000 456,000 350,000 394,000 7,063,000 Total purchases during year 1,418,116 10,883,600 12,274,250 6,785,700 1,593,500 8,274,900 41,379,760 650,050 615,650 1,187,240 1,394,950 2,142,600 88,600,316 Sales during years United States bonds 2 827,374 1,726,300 5,449,300 1,640,150 1,194,500 6,570,900 40,976,260 66,550 530,000 10,000 502,100 1,321,350 2 60,814,784 1-year Treasury notes 1,725,000 1,636,000 456,000 350,000 394,000 4,561,000 Total sales during year 2 827,374 3,451,300 5,449,300 3,276,150 1,650,500 6,920,900 41,370,260 6,550 530,000 10,000 502,100 1,321,350 2 65,375,784 Conversions: United States 2 per cent bonds converted during year , 2,389,000 3,552,500 2,749,200 3,227,200 1,799,100 1,335,500 3,722,000 1,106,300 1,281,600 1,642,900 1,451,200 2,000,000 26,256,500 CO Received from United States Treas- fcl urer in exchange for bonds converted— 3 per cent conversion bonds of 1947. 1,195,000 1,776,500 1,375,200 1,614,200 900,100 668,500 1,861,000 553,300 641,600 821,900 726,200 1,000,000 13,133,500 W O 3 per cent 1-year gold Treasury notes 1,194,000 1,776,000 1,374,000 1,613,000 899,000 667,000 1,861,000 553,000 640,000 821,000 725,000 1,000,000 13,123,000 Total 2,389,000 3,552,5001 2,749,200 3,227,200 1,799,100 1,335,500 3,722,000 1,106,300 1,281,600 1,642,900 1,451,2QQ 2,00.0,0.00 26,25.6,5.00 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Balance on hand Jan. 1,1918: United States bonds i 728,7425,186,850 7,101,950 8,268,010 1,236,450 2,397,000 7,006,600 2,233,400 1,887,990 8,849,090 4,496,100 2,455,000i 51,847,182 1-year Treasury notes 2,194,000 4,493,0002,548,000 3,221,000 1,969,000 1,491,000 3,378,000 1,444,000 1,340,000 1,784,000 1,430,000 1,500,000 26,792,000 Total 2,922,7429,679,8509,649,950 11,489,0103,205,450 3,888,000 10,384,6003,677,400 3,227,990 10,633,0905,926,100 3,955,000i 78,639,182 1 Includes unpaid portion of 4 per cent Liberty loan bonds sold by Boston Federal Reserve Bank to individual subscribers. 2 Includes partial payments on Liberty loan bonds sold by Boston Federal Reserve Bank to individual subscribers. Public debt refunding operations conducted by the Secretary of the Treasury under authority of sec. 18 of the Federal Reserve Act during the calendar year 1917. O TWO PER CENT BONDS OF THE UNITED STATES SUBMITTED BY FEDERAL RESERVE BANKS AND CANCELED. & H Jan. 1,1917. Apr. 1,1917. Total for year 1917. O i Federal Reserve Bank. co 2 n p so e l r s , c 1 e 9 n 3 t 0. 2 1 P 9 a p 3 n e 6 a r - 1 m c 9 e a 3 n s 8 t , . Total. co 2 n p so e l r s , c 1 e 9 n 3 t 0. 2 P 19 a p 3 n e 6 a r - 1 m c 9 e a 3 n s 8 t , . Total. co 2 n p so er ls , c 1 e 9 n 3 t 0. P 2 19 a p 3 n e 6 a r - 1 m c 9 e a 3 n s 8 t , . Total. 9 3 Boston $1,252,000 $80,000 $1,332,000 $1,057,000 $1,057,000 $2,309,000 $80,000 $2,389,000 New York 142,000 900,000 1,042,000 2,185,500 $325,000 2,510,500 2,327,500 1,225,000 3,552,500 Philadelphia 1,651,000 1,651,000 1,092,000 6,200 1,098,200 2,743,000 6,200 2,749,200 Cleveland ... 903,900 1,500,000 2,403,900 60,000 763,300 823,300 963,900 2,263,300 3,227,200 Richmond .. 999,100 800^000 1,799,100 999,100 800,000 1,799^100 Atlanta 1,205,100 120,000 1,325,100 10,400 10,400 1,215,500 120,000 1,335,500 1 Chicago 2,331,000 559,000 2,890,000 832,000 832,000 3,163,000 559,000 3,722,000 St. Louis 1,106,300 1,106,300 1,106,300 1,106,300 Minneapolis 1,010,000 50,000 1,060,000 221,600 221,600 1,231,600 50,000 1,281,600 Kansas City.. 1,392,900 250,000 1,642,900 1,392,900 250,000 1,642,900 Dallas 951,200 500,000 1,451,200 951,200 500,000 1,451,200 San Francisco 2,000,000 2,000,000 2,000,000 2,000,000 Total. 13,838,200 4,759,000 18,597,200 6,564,800 1,094,500 7,659,300 20,403,000 5,853,500 26,256,500 to Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Public debt refunding operations conducted by the Secretary of the Treasury under authority of sec. 18 of the Federal Reserve Act during the calendar year 1917—Continued. to THIRTY-YEAR 3 PER CENT CONVERSION BONDS AND ONE-YEAR 3 PER CENT TREASURY NOTES ISSUED TO FEDERAL RESERVE BANKS. Jan. 1,1917. Apr. 1,1917. Total for 1917. One-year One-year Federal Reserve Bank. Conversion Treasury Conversion Treasury Conversion One-year bonds, series notes, series Total. bonds, series notes, series Total. bonds, series Treasury Total. 1917-1947. Jan. 1, 1917-1947. Apr. 1, 1917-1947. notes. 1917-18. 1917-18. 3 Boston $666, $666,000 $1,332,000 $529,000 $528,000 $1,057,000 $1,195, $1,194,000 $2,389,000 New York 521, 521,000 1,042,000 1,255,500 1,255,000 2,510,500 1,776, 1,776,000 3,552,500 O Philadelphia... 826, 825,000 1,651,000 549,200 549,000 1,098,200 1,375, 1,374,000 2,749,200 I Cleveland 1,201, 1,202,000 2,403,900 412,300 411,000 823,300 1,614, 1,613,000 3,227,200 Richmond 900, 899,000 1,799,100 900, 899,000 1,799,100 Atlanta 658, 667,000 1,325,100 10,400 10,400 668, 667,000 1,335,500 Chicago 1,445, 1,445,000 2,890,000 416,000 416,000 832,000 1,861, 1,861,000 3,722,000 W § St. Louis 553,300 553,000 1,106,300 553, 553,000 1,106,300 f Minneapolis... 530, 530,000 1,060,000 111,600 110,000 221,600 641, 640,000 1,281,600 Kansas City... 821, 821,000 1,642,900 821, 821,000 1,642,900 Dallas 726, 725,000 1,451,200 726, 725,000 1,451,200 San Francisco. 1,000, 1,000,000 2,000,000 1,000, 1,000,000 2,000,000 Total.... 9,296,200 9,301,000 18,597,200 3,837,300 3,822,000 7,659,300 13,133,500 13,123,000 26,256,500 W Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Amounts originally allotted by Federal Reserve Board on basis of capital and actual amounts converted. Federal Reserve Bank. R A in e b m a s y e l l o r F y v u e e n a d t ll s e B o r o o t a t r a l e ig r d d - . c A o ac n m t v u o e a u r l t n l e y t d s . Federal Reserve Bank. R A in b e m a y s l e o l r y F u v e n a e d t l s l B e o r o o t a t r a e i l g r d d - . c A o ac n m t v u o e a u r l t n l e y t d s . Boston $2,696,200 $2,389,000 St. Louis...... $1,504,600 $1,106,300 New York... 6,412,900 3,552,500 Minneapolis... 1,281,600 1,281,600 Philadelphia 2,814,200 2,749,200 Kansas City.. 1,642,900 1,642,900 Cleveland.... 3,227,200 3,227,200 Dallas 1,451,200 1,451,200 s Richmond... 1,799,100 1,799,100 San Francisco 2,112,500 2,000,000 Atlanta 1,335,500 1,335,500 Chicago 3,722,100 3,722,000 Total... 30,000,000 26,256,500 w I W o 0 to Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Amounts of municipal warrants bought by Federal Reserve Banks, during each month of calendar year 1917. to []JQ thousands of dollars.] OO January. February March. April. May. June. July. August. Se b p e te r. m- October. No b v e e r m . - D b ec e e r m . - T 1 o 9 t 1 a 7 l . , T 1 o 9 t 1 a 6 l . , c P e e n r t, c P en er t, 1917. 1916. Boston. . . 127.0 127.0 7,621.6 0.76 8.4 New York 2,798.0 2,459.8 50.4 1,016.5 6,324.7 38,432.3 37.60 42.4 Philadelphia 1,268.3 25.2 2.6 126.7 29.2 125.9 10.0 33.5 1,621.4 7,823.0 9.64 8.6 Cleveland 838.2 1,043.7 1,023.3 17.4 12.3 4.9 9.3 2,949.1 10,660.2 17.53 11.7 Richmond 15.0 100.0 115.0 529.6 0.68 0.6 Atlanta 3.0 7.2 27.0 11.6 145.0 130.6 91.3 415.7 420.3 2.47 0.5 Chicago . 1,170.7 9,88.6 5.1 2,164.4 9,733.3 12.87 10.7 o St. Louis 466.0 552.5 1,018.5 3,619.2 6.06 4.0 Minneapolis. 151.7 10.2 15.2 177.1 3,734.8 1.05 4.1 h H rj Kansas City 152.2 278.9 431.1 1,996.8 2.56 2.2 W Dallas . 121.7 362.0 103.8 104.2 691.7 152.3 4.11 0.2 San Francisco 760 7 25 2 785.9 5,962.6 4.67 6.6 Total, 1917.. 7, 730. 5 5,852. 7 1,031.0 280.3 118.9 4.9 100.0 135.2 21.8 1,186. 7 164.1 195. 5 16,821.6 Percent 45.96 34.79 6.13 1.67 0.71 0.03 0.59 0.80 0.13 7.05 0.98 1.16 100.00 Total, 1916.. 9, 806.3 10,450.8 10,425.9 10,361.1 8,979. 2 5,477.8 7,524.5 1,602.9 5,090.9 10,267.5 7,565.1 3,404.0 90,686.0 Percent 10.8 11.5 11.5 11.4 9.9 6.1 8.0 1.8 5.6 11.3 8.3 3.8 100.0 w NOTE.—The amounts of municipal warrants purchased, as shown above, do not in all cases agree with the amounts shown in the reports of Federal Reserve agents, as figures given above represent amounts charged to investments, while figures shown in some of the agents' reports represent the par value of warrants purchased. O I Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Investment operations, exclusive of 'purchases of United Stales certificates of indebtedness, of Federal Reserve Banks during 1917 and 1916, by months and classes of investments. Acceptances bought in open market. United States bonds and Treasury notes. Commercial Year and month. paper discounted. Bankers. Trade. Total. 2 per cent. 3 per cent. 3J per cent. 4 per cent, January $18,326,286 $20,376,041 $241,139 $20,617,180 $2,370,150 $61,240 February 22,408,604 68,994,291 1,646,388 70,640,679 144,500 200 $250 March 26,788,982 27,475,820 676,818 28,152,638 8,565,510 50,000 25,000 H April 50,055,801 41,019,251 293,440 41,312,691 2,867,040 3,000 O May 91,413,473 79,355,481 3,188,891 82,544,372 50,000 2,000 w June 750,269,838 132,481,554 2,748,143 135,229,697 $1,232,900 9,000 H July 460,733,354 63,629,153 3,234,912 66,864,065 67,000 18,299,650 O August 220,939,974 67,510,898 4,611,904 72,122,802 3,825,460 September 548,164,104 104,162,500 4,883,966 109,046,466 20,830,650 October 2,681,165,854 85,443,102 1,451,080 86,894,182 3,100 157,650 29,650 November 3,206,486,771 181,872,277 4,346,451 186,218,728 2,000 250,550 1,294,396 December 433,413 174,444,166 3,624,843 178,069,009 1,265,750 20,130,670 Total, 1917. 9,014.186,454 1,046,764,534 30,947,975 1,077,712,509 13,997,200 188,540 45,862,610 21,488,966 Total, 1916. 207,870,500 369,762,300 16,332,700 386,095,000 48,128,100 3,918,880 4,403,200 i w o to Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Investment operations, exclusive of purchases of United States certificates of indebtedness, of Federal Reserve Banks during 1917 and 1916, hy months CO and classes of investments—Continued. Q United States bonds and Municipal warrants. Treasury notes. Year and month. Total, 1917. Total, 1916. 1-year Treasury Total. City. State. All other. Total. notes. January $2,431,390 $7,201,908 $2,040 $526,552 $7,730,500 $49,105,356 $37,150,980 February.. $456,000 600,950 5,798,677 53,985 5,852,662 99,502,895 40,028,950 o March 1,882,000 10,522,510 1,021,383 9,640 1,031,023 66,495,153 50,981,150 w April 1,220,000 4,090,040 266,433 13,853 280,286 95,738,818 50,861,300 H May 52,000 75,656 43,265 118,921 174,128,766 48,199,800 O June 756,000 1,997,900 4,925 4,925 887,502,360 60,785,340 H July 1,370,000 19,736,650 100,000 100,000 547,434,069 64,354,450 W August 3,825,460 125,938 9,278 135,216 297,023,452 47,902,200 September. 20,830,650 11,756 10,000 21,756 678,062,976 58,679,500 October 1,369,000 1,559,400 1,043,604 133,052 10,000 1,186,656 2,770,806,092 63,282,160 November. 1,546,946 125,023 39,050 164,073 3,394,416,518 79,614,600 December.. 10,000 21,406,420 124,404 2,944 68,200 195,548 1,137,104,390 139,531,250 Total, 1917.. 7,063,000 88,600,316 15,769,759 263,059 788,748 16,821,566 10,197,320,845 Total, 1916.. 300,000 56,750,180 85,662,400 4,087,100 936,500 90,686,000 741,401,6 w W 1 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Total investment operations (exclusive of United States certificates of indebtedness) of Federal Reserve Banks during each month in 1917. Federal Reserve Banks.January. February. March. April. May. June. July. August. September. October. November. December. Total. Boston 237,301 $9,322,187$11,313,775 $11.,194,509 $21,520,242 854,762,507 $45,833,930 S34,000088,,633 $42!,, 643,906$17,426,697 $72,650,494 $119,078,427 $443,992,608 New York 074,236 24,684,930 ,847,997 12,126,638 35,435,315 636,974,965 288,878,639 537,219 382,032!.,483 2,435,196,730 ,725,388,208 397,456,543 7,018,633,903 Philadelphia 940,77111,766,311 ,720,424 7,780,935 25,878,818 46,166,378 33,648,283 064,872 25,000,483 21,394,910 50,991,728 61,871,567 323,225,480 Cj Cleveland 861,364 9,7771,303 ,078,665 12,367,954 12,364,331 14,286,956 17,613,760 31.344,170 27,590,006 34,065,986 71,336,386 72,339,201 312,020,076 f Richmond 113,99212,463,798 ,557,926 17,850,227 28,950,676 34,386,530 38,483,310 31303,845 53,156,900 30,856,826 66,897,279 127,023,937 461,045,246 W Atlanta 831,894 097,817 ,043,195 3,638,069 4,447,965 4,300,048 4,764,512 878,896 9,642,351 20,591,323 27,834,659 37,127,114 130,197,843 Chicago 475,117 728,315 932,290 6,113,932 14,233,710 45,394,072 56,624,084 317,759 57,965,950 99,420,562 163,945,464 141,979,156 632,130,411 O St. Louis 2,354,689 5,7774,492 439,062 6,188,527 10,473,522 5.543,937 16,724,850 839,427 25,349,894 26,045,543 40,091,632 57,693,031 217,518,606 w Minneapolis 2,801,402 4,362,900 951,062 10,177,57' 4,745,445 10,497,832 8,821,257 148,906 4,452,325 8,210,489 28,984,352 18,873,321 119,026,868 H Kansas City 828,926 122,342 577,659 1,089,700 8,100,880 19,706,619 19,411,691 323,333 28,260,858 44,466,463 75,018,316 47,231,067 271,137,854 O Dallas 1,087,911 749,591 638,073 2,333,321 2,846,179 3,773,121 6,800,881 742,224 9,440,775 16,625,539 26,904,709 14,273,817 94,216,141 H San Francisco 5,497,753 658,909 395,025 4,877,429 5,131,683 11,709,395 9,828,872 14,514,168 12,527,045 16,505,024 44,373,297 42,157,209 174,175,809 W fed Total, 1917 49,105,356 99,502,895 66,495,153 95,738,818174, r, 502,360 574,:434,069 297';,023,452 67:8,062,9762,770,806,092 3!,; 394,416,5181[,137,104,390101,,197,320,845 Total, 1916 37,150,980 40,028,950 50,981,150 50,861,300 48,199,800 60,785,340 64,354,450 47,902,200 58,679,500 63,282,160 79,644,600 139,531,250 741,401,680 Total, 1915 23,450,300 20,345,800 26,834,900 17,838,900 20,242,500 23,179,300 27,048,000 29,375,00C 23,556,300 23,961,000 38,178,720 33,760,100 307,770,770 fed m fed o CO Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Earnings on investments of Federal Reserve Banks—average amounts of earning assets held by each Federal Reserve Bank, and annual rates of earnings during 1917. CO Average balances for the year of the several classes of Calculated annual rate of earnings earning assets. Earnings from— from— Bills Bills f B b c R o F e o i r e e l r u l d s m s s n e e a t e d r r e n v m a i d s d e l - - m i b n o B a o u r il k p g l e e s h n t t . p M r a a l u n n w t i s c a . i r - - se U S cu n ta r i i t t t e e i s d es. Total. b c F e o m e r d u f d s e o i n s e m a r - t r e n a - d d l m i b n o B a o u r i k p l g l e e s h n t t . M r w a ip u n a n a t r i s l - c . - U s S e t n t i c a e i u t t s e r e . i s d - Total. c F m o e b a d u f d e e n o i n s m e r d r t - s r e a - d l m b in o B a u r o i k l g p l e h s e t n t . M r w a u n a n t r i s - c . - U s S e t n t i c a e i u t t s e e r . i d s - in T h m in o v o e g l e t d n s a s . - t t l - o Banks, Reserve Reserve Banks. Banks. H. o Boston $12,812,843 $15,463,576 $173,214 $3,378,029 $31,827,662 $571,117 $502,397 $5,203 194,785 $1,173,502 4.46 3.25 3.00 2.81 3.69 H New York 78,622,402 55,314,853 2,192,696 14,374,096 150,504,047 2,455,533 1,843,325 66,470 378,668 4,743,996 3.12 3.33 3.03 2.63 3.15 M Philadelphia.. 9,923,917 14,916,598 628,229 4,268,208 29,736,952 370,359 474,653 18,170 123,875 987,057 3.73 3.18 2.89 2.90 3.32 Cleveland 9,531,459 15,348,152 1,457,326 11,314,574 37,651,511 375,169 496,712 48,132 317,924 1,237,937 3.94 3.24 3.30 2.81 3.29 Richmond 10,720,028 6,235,457 15,792 3,672,428 20,643,705 418,629 201,008 560 96,143 716,340 3.91 3.22 3.55 2.62 3.47 Atlanta 5,812,100 3,067,694 98,640 4,511,059 13,489,499 231,636 102,312 3,629 140,820 478,397 3.99 3.34 3.68 3.12 3.55 Chicago 24,407,209 12,690,553 1,001,753 15,893,460 53,992,975 938,543 394,340 30,880 443,958 1,807,721 3.85 3.11 3.08 2.79 3.35 St. Louis.,... 9,314,101 5,384,333 446,635 4,266,752 19,411,821 358,239 170,233 13,691 110,301 652,464 3.85 3.16 3.07 2 59 3.36 Minneapolis.. 7,370,500 4,703,067 153,483 3,833,442 10,060,492 311,376 148,531 4,480 97,936 562,323 4.22 3.16 2.92 2.55 3.50 Kansas City-. 10,635,571 5,346,357 178,525 11,079,176 27,239,629 438,831 171,112 5,137 256,792 871,872 4.14 3.20 2.88 2.32 3.20 Dallas 4,666,809 4,074,509 262,003 0,044,720 15,048,047 209,065 138,513 6,833 159,432 513,843 4.48 3.40 2.61 2.64 3.41 San Francisco 6,468,358 9,501,149 409,914 5,717,007 22,096,428 292,982 308,596 11,935 147,355 760,868 4.53 3.25 2.91 2.58 3.44 Total... 190,285,297 152,046,298 7,018,216 18,352,957 437,702,768 i, 971,4794,951,732 215,120 2,367,9 14,506,320 3.6 3.26 3.07 2.68 3.31 w o Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Exhibit E.—GOLD SETTLEMENT FUND. Condensed summary of transactions, Jan. 1 to Dec. 31, 1917, both inclusive. [In thousands of dollars.] Transfers between Federal Balance in Deposits. "Withdrawals. Reserve banks. fund on open- Federal Reserve Bank of— ing of business Jan. 1, 1917. Gold. fr T om ran a s g fe e r n s t. Total.- Gold. Tra a n g s e fe n r t s . to Total. Debit. Credit. on Boston 14,737 41,300 41,300 44,059 2,000 46,059 218,900 83,183 New York 20,570 461,742 25,000 486,742 131,727 100,000 231,727 560,951 1,888,938 Philadelphia. 8,042 87,496 137,831 225,327 123,499 182,990 206,489 291,868 22,044 Cleveland 16,953 37,395.4 1,000 38,395.4 43,671.4 35,200 78,871.4 324,650 1,035 Richmond 19,416 55,894.6 12,780 68,674.6 17,187.4 31,500 48,687.4 228,833 33,409 Atlanta 6,689 15,467 23,680 39,147 1,666 59,430 61,096 32,907 40,554 ts Chicago 26,183 160,247.5 112,490 272,737.5 75,327 238,460 313,787 364,957 221,898 St. Louis 3,395 33,730 16,045 49,775 2,834 39,840 42,674 61,320 41,480 Minneapolis.. 7,064 28,123.5 15,520 43,643.5 7,503 35,020 42,523 64,630 14,575 Kansas City.. 21,235.5 30,387.6 9,820 40,207.6 3,140 39,020 42,160 173,950.5 10,891 . Dallas 14,966.5 4,742 15,176 19,918 8,559.3 16,770 25,329.3 84,080 27,925.5 San Francisco 10,489 10,030 41,745 51,775 23,685 72,651 96,336 236,800 257,914 02 Total... 169,740 966,555.6 411,0 1,377,642.6 482,858.1 852,881 1,235,739.1 2,643,846.5 2,643,846.5 CO CO Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Condensed summary of transactions, Jan. 1 to Dec. 81, 1917, both inclusive—Continued. CO {In thousands of dollars.] "Weekly settlements from Jan. 4 to Bee. 27, both in- Changes in ownership of gold through transfer and setclusive. tlement. Balance in Federal Reserve Bank of— fund at close of business Total of Total of Net debits. Total debits. Total credits. Net credits. Dec. 31,1917. w d e e e c k re ly a se n s e . t w in ee cr k e l a y s e n s e . t Ne fo t r d e y c e r a e r a . se N f e o t r in y c e r a e r a . se Boston 66,007 1,794,404 1,935,120 206,723 14,977 142,365 147,364 4,999 New York.... 1,623,827 8,136,064 6,553,346 41,109 20,854 882,318 627,587 254,731 Philadelphia. 55,619 2,824,257 3,106,302 337,664 39,101 190,140 202,361 12,221 HI Cleveland 17,531 1,765,655 2,150,457 402,333 37,664 131,606 192,793 61,187 O Richmond.... 34,539 1,205,483 1,383,605 212,661 22,101.2 128,823 111,521 17,302 Atlanta 42,310 695,392 716,012 62,930 13,007 46,072 74,339 28.267 Chicago 116,155 3,140,781 3,347,026 322,400 48,319.5 219,181 282,367 63,186 St. Louis 62,197 1,699,135 1,726,363 89,425 17,884 86,368 93,756 7,388 Minneapolis.. 35,852 624,475 686,832 98,209 20,486.5 66,438 78,740 12,302 Kansas City.. 8,585 1,063,314 1,244,177 189,448 37,086.6 83,222.5 101,026 17,803.5 Dallas 23,605 536,224 607,344 94,725 24,520.7 63,254.5 78,220 14,965.5 San Francisco 68,494 833,876 862,476 97,094 15,642 106,790 156,504 49,714 Total... 2,154,721 24,319,060 24,319,060 2,154,721 311,643.5 2,146,578 2,146,578 272,033 272,033 W O I Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

ANNUAL EEPOET OF THE FEDERAL RESEEVE BOARD. 135 Gold settlement fund—Changes in ownership of gold through transfer and settlement, by weeks. [In thousands of dollars; i. e., 000's omitted.] Boston. New York. Philadelphia. Cleveland. Richmond. Week ending, 1917— In- De- In- De- In- De- In- De- In- Decrease. crease. crease. crease. crease. crease. crease. crease. crease. crease. Ian. 1-4 4,548 16,801 4,830 3,871 2,176 11 1,423 2,095 5,584 1,716 1,204 18 3,262 3,970 5,755 1,387 1,977 25 2,414 10,253 2,794 1,825 246 Feb 1 205 11,715 1,209 3,225 574 8 5,414 7,007 4,625 1,926 882 15 179 7,455 4,689 1,308 1,761 23 1,353 124 6,711 1,117 1,372 Mar. 1 5,508 13,784 1,307 93 436 8 1,347 19,840 6,422 350 1 15 2,027 3,797 1,174 3,783 1,23d 22 4,362 16,106 5,255 291 350 29 1,440 4,090 1,586 4,898 102 Apr 5 3,457 5,686 7,965 512 357 12 6,874 17,751 336 735 569 19 1,738 21,700 314 7,336 1,564 26 3,568 53,775 15,219 6,808 1,685 May 3 17,062 75,722 13,890 4,985 3,046 10 11,639 44,398 6,752 1,591 7,603 17 3,909 1,634 5,516 4,743 842 24 1,247 28,433 10,163 7,595 1,04 31 284 18,595 3,561 5,265 64 June 7 5,308 41,551 13,444 2,371 434 14 88 9,017 8,372 7,136 4,996 21 18,844 39,655 9,555 1,478 578 28 7,764 61,846 9,042 21,394 2,953 July 5. 4,373 54,108 10,488 1,148 6,676 12 . 25,382 104,846 16,464 5,262 16,089 19 1,437 4,400 9,147 2,190 5,965 26 7,354 19,577 3 980 13,906 16,081 Aug. 2 6,067 149,800 29,751 8,283 40,772 9 10,067 102,066 13,114 15,409 25,280 16 3,956 3,693 1,022 5,847 9,203 23. 3,698 26,318 4,019 1,139 2,780 30 9,705 16,649 8,418 8,698 6,627 Sept. 6 .. 4,411 3,169 12,607 8,366 6,685 13.. 2,478 38,340 762 4 624 7,194 20 . 1,399 16,350 4,464 6,032 1,802 27 2,256 54,359 13,610 1 697 4 890 Oct. 4 831 10,684 4,685 8,182 432 11 646 37,430 34 10,845 874 18 2,620 58,521 1,698 6,113 5,168 25 9,268 8,105 696 3,371 503 Nov. 1 1,560 44,402 2,608 393 5,895 8 6,966 2,152 432 19,304 4,798 15 1,617 29,306 10,198 13,281 1,654 22. . 21,088 28 533 6,521 11,721 6,128 30 1,191 19,898 23,590 1,602 3,542 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

136 AHNUAL EEPOET OF THE FEDERAL RESERVE BOARD. Gold settlement fund—Changes in ownership of gold through transfer and settlement} by weeks—Continued. [In thousands of dollars; i. e., 000's omiited.] Boston. New York. Philadelphia. Cleveland. Richmond. Week ending, 1917— In- De- In- De- In- De- In- De- In- Decrease. crease. crease, crease. crease. crease. crease. crease. crease. crease. Dec. 6 1.792 15,236 . 19,715 12,456 3,113 13. . . . 18,174 65,638 13,580 14,476 16,560 20 .... 11,005 33,873 6,664 22,523 2,000 27 7,124 20,252 18,164 19,792 1 577 28-31 8,000 5,400 Total 147,364 142,365 627,587 882,318 202,361 190,140 192,793 131,606 Ill, 521 128,823 Net increase or decrease (—) 4,959 -254,731 12,221 61,187 -17,302 Atlanta Chicago. St. Louis. Minneapolis. Week ending, 1917— Increase. Decrease. Increase. Decrease. Increase. Decrease. Increase. Decrease. Jan 1-4 1,788 3,828 4,540 3,233 11 1,511 157 6,304 878 18 3,475 3,128 881 663 25 1,283 1,478 2,572 474 Feb 1 1,999 5,416 615 308 8 1421 3,952 3,473 193 15 310 5,750 3,673 .... 1,534 23 2,955 3,454 1,015 440 Mar 1 93 11,729 364 360 8 14 4,703 2,019 2,231 15 . . 508 2,367 574 38 22 665 443 1,051 2,155 29 78 4,581 2,557 2,364 Apr 5 682 210 167 2,264 12 1,177 14.. 042 2,652 959 19 2,423 7,573 3,299 2,466 26 Q84 17,925 8,MR 1 363 May 3 1,132" 11,338 3,985 432 10 3,616 5,046 994 638 17 51 *> 1,463 938 1,805 24 598 8,534 2,468 2,895 31 1,253 7,986 153 1 558 x, June 7 ,158 10,397 fvW 1 608 14 459 6,880 5,356 2,290 21 5,392 7,664 2,129 833 28 3,070 5,005 3 714 3 981 July 5... 1,777 21,746 489 2,068 12 2,363 2,454 6,384 ... 9,323 19 1,559 7,856 4,482 1,110 26 581 ... 22,855 2,046 829 Aug. 2 5,172 26,904 3,590 ... 4,031 9 1,150 16,318 8,003 313 16 48 339 5,310 615 23 1,057 7,122 3,407 1,222 30 2,057 18,805 2,652 4,672 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. 137 Gold settlement fund—Changes in ownership of gold through transfer and settlement, by weeks—Continued. [In thousands of dollars; i. e., 000's omitted.] Atlanta. Chicago. St. Louis. Minneapolis. Week ending, 1917—• Increase. Decrease. Increase. Decrease. Increase. Decrease. Increase. Decrease. Sept 6 472 21,834 1,716 1,031 13 4 553 6,613 129 3,494 20 2,518 13,647 2,763 2,799 27 7,867 7,582 310 498 Oct. 4 3,141 13,376 2,303 3,444 11 2,537 7,009 2,944 5,640 18 1,910 21,807 5,719 1,865 25 784 5,261 798 1,762 Nov. 1 1,341 31,929 1,643 1,790 8 2,328 20,581 4,251 3,091 15 2,262 656 14,718 6,191 22 10 034 2,269 4,217 824 30 3,207 3,812 4,335 9,649 Dec. 6 1,908 1,504 2,202 7,161 13 9,448 1,042 14,023 15,211 20 5,724 31,690 9,638 7,874 27 157 31,488 6,472 10,708 28-31 3,900 Total 74,339 46,072 282,367 219,181 93, 756 86,368 78,740 66,438 Net increase or decrease (—) 28, 267 63,186 7,388 12,302 Kansas City. Dallas. San Francisco. Total. Week ending, 1917— Increases Increase. Decrease. Increase. Decrease. Increase. Decrease. and decreases,, Jan. 1-4 14,409 3,369 421 31,907 11 9,263 1,331 1,250 16,358 18 28 1,746 3,970 15,121 25 •431 1,244 496 12,755 Feb. 1 2,088 528 886 14,384 8 430 1,986 3,625 17,467 15 2,326 847 2,802 16,317 23 791 1,194 334 10,430 Mar. 1 1,015 1,304 419 18,206 8 645 681 2,127 20,190 15 714 552 1,862 9,316 22 3,581 111 2,382 18,376 29 959 457 1,480 12,296 Apr. 5 65 362 1,833 11,780 12 . . 2,185 297 109 23, 843 19 • 628.5 1,486.5 5,162 27,845 26 1,275 3,828 4,846 59,862 May 3 8,979 443 11,294 76,154 10 9,883 6,550 2,166 50,438 17 2,646 1,879 6,117 16, 002 24 1,147 482 3, 942 34, 276 31 552 1,497 7,954 24,361 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

138 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. Gold settlement fund—Changes in ownership of gold through transfer and settlement, by weeks—Continued. [In thousands of dollars; i. e., OOO's omitted.] Kansas City. Dallas. Sau Francisco. Total. Week ending, 1917— Increases Increase. Decrease. Increase. Decrease. Increase. Decrease. and decreases. June 7 1,430 1,483 7,285 45,054 14 . 2,010 2,528 3,426 26 279 21 . 3,653 4,330 6,245 50,178 28 4,852 3,563 6,518 66,851 July 5 5,006 359 11,020 59,629 12 9,817 11,206 10,626 110,108 19 1,750 2,217 853 21 483 26 3,933 1,852 3,032 48,013 Aug. 2 5,092 6,867 13,271 149,800 9 4,529 362 7,521 102,066 16 1,354 723 34 16,072 23 . 139 3,483 6 534 30,459 30 . . 5,094 2,307 1,492 43,588 Sept 6 4,214 1,853 552 33,455 13 662 3,810 13,, 857 43,258 20 2 900 3,654 4 888 31 608 27 5,221 632 13,810 56,366 Oct. 4 2,683 6,104 147 28,006 11 4,063 5,856 1,726 39,802 18 . 5,679 1,724 7,614 60,219 25 950 1,374 2,976 17,924 Nov 1 15,533 1,619 3,065 55,889 8 1,792 3,822 3,307 36,412 15 5,564 2,075 2,454 44,988 22 ... 8,660 3,651 13,176 58,411 30 11,003 10,470 10,557 51,428 Dec 6 628 1,255 11,012 38,991 13 140 11 111 9 201 94 302 20 1,188 1,676 9,681 71,768 27 669 6,834 1,937 62,587 28-31 500* 2,000 8,000 Total 101,026 83,222.5 78,220 63,254. 5 156,504 106,790 2,146,578 Net increase or decrease (—) 17,803.5 14,965.5 49,714 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

ANNUAL EEPOBT OF THE FEDERAL RESERVE BOABD. 139 li Wi zEh'LY TF, 14Cr/OJ \ i 7'HR0U<3H 'i H 1000 1000 GOLD\ TLL'ML:NT /yp •' • Iin' J AN. ' 71ID EC. 917. 300 900 ijli % re/.- Wee,•tigSettUrneru CUT CUT ve2.- Trotxfersbeth dan, A\\ / / QUU cUu•ing 1 I i\ V ?00 700 1 s/ i m 1 I 600 600 LLt- I I k |V /u ^\ 500 If n SOO f / /*J \\ 400 •I \lA A'/ *HAJ 1 300 tt 300 1 ZOO 200 100 100 0 0 JAN. FEB.MCH.APR. MAYJUNEJULY OCT.NOV.DEC. 34365°—18 10 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Exhibit F.—CLEARING OPERATIONS, JAN. 1 TO DEC. 31, 1917. Disburse- Federal Reserve Bank. Tot o a f l i n te u m m s ber Total amounts m tra e n n s t i s t , pe C r o it s e t m t C h o o s u t s p a e n r d S c e h r a v r i g c e e handled. depart- handled. dollars. per item. ment. Cents. Cents. Cents. Boston 13,482,481 $6,951,310,787 $96,132 0.71 1.39 0.9 New York.... 17,975,769 14,051,822,671 211,216 1.11 1.5 1 Philadelphia.. 11,727,528 7,363,095,829 105,035 .9 1.43 1.5 Cleveland 5,901,160 3,932,056,724 83,492 1.4 2.1 L.5 Richmond 5,688,280 3,403,949,500 51,186 .9 1.5 ]L.25 Atlanta 4,031,458 1,636,315,075 51,386 1.27 3.14 ]L.5 Chicago 7,532,366 5,363,610,000 72,886 .97 1.36 ]1.5 St. Louis1 2,648,276 1,206,630,532 36,332 1.37 3.01 ]L.5 Minneapolis... 4,386,422 1,097,635,030 44,461 1.01 4.05 1.5 Kansas City.. 4,559,277 3,537,781,323 57,330 1.26 1.62 1.5 Dallas 3,717,220 990,202,304 51,263 1.38 5.18 1.5 San Francisco. 3,046,711 2,059,361,119 68,123 2.23 3.3 U.5 Total... 84,696,968 51,593,770,894 928,842 1.1 1.8 1 Exclusive of Government and clearing-house items amounting to $1,172,285 and $1,825,621,615, respectively. 2 Service charge per item was 2 cents until Oct. 15, when it was changed to 1.5 cents. 140 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Exhibit G—RECEIPTS AND DISBURSEMENTS OF THE FEDERAL RESERVE BOARD. There is here given a statement of receipts and expenditures of the Federal Reserve Board in 1917. The total expenses of the Board for the calendar year 1917 are shown on the detailed statement of commitments to have been $249,302.22. This amount includes a number of items which have of necessity been estimated. Under the Federal Reserve Act the Federal Eeserve Board is authorized to make semiannual assessments upon Federal Eeserve Banks to cover its expenses. The first assessment for this purpose was made on November 2, 1914. The funds of the Board are carried in a special account with the Treasurer of the United States, and transfers are made by the governor of the Board to the credit of the fiscal agent, as necessary. The accounts of the Board pass through the office of the Auditor for the State and Other Departments and are given the official examination required b}^ the Government. The term " auditor's settlement" under " Disbursements" covers settlements made by transfers of credit authorized and directed by the auditor on the books of the Treasury Department. The term "commitments," where used, covers all obligations entered into by the Board for the periods stated. EECEIPTS. Unexpended balance Jan. 1, 1917 $14, 005. 96 Assessments, 1917 237, 776. 82 Bulletin, subscriptions to 1, 693. 99 Reimbursements 11, 479.10 Miscellaneous 1,917.32 Total available $266, 873.19 DISBURSEMENTS. By fiscal agent — 218,507.75 Auditor's settlements 31, 801. 00 Total disbursements 250, 363. 75 Balances Dec. 31, 1917. with Treasurer of Suited States to credit of— Fiscal agent __ 4,264.71 Federal Reserve Board 12, 239. 73 ;1G, 504, 44 266, 873. 19 141 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

142 ANNUAL REPORT OF THE FEDERAL RESERVE BOABD. GENERAL STATEMENT. Total available $266,873.19 Reimbursable expenditures $11, 235. 00 Balance to credit, reimbursable account __ 500. 71 — 11,735.71 $255,137. 48 Commitments for general expenses, 1917 249, 302. 22 Commitments, 1916; paid in 1917 4, 000.18 253, 302. 40 Unencumbered balance Jan. 1, 1918 1, 835. 08 Unpaid commitments Dec. 31, 1917 :__„_____ 14,168. 65 Balance to credit reimbursable account 500. 71 Unexpended balance 16, 504. 44 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Detailed statement of expenditures. January. February. March. April. May. June. July. August. te S m e b p e - r. . October. No b v e e r. m- D . e b c e e r m . - Total. Personal services: Board and its clerks $7,373.31 $7,273.31 $7,343.05 $7,383.31 $7,383.31 $7,347.04 $7,476.65 $7,383.31 $7,343.09 $7,379.18 $7,458.33 $7,458.34 $88,602.23 Secretary's office 2,618.33 2,591.67 2,478.89 2,475.00 2,481.67 2,481.67 2,305.83 2,379.17 2,379.17 2,427.50 2,393.33 2,430.84 29,443.07 Counsel's office 2,126.66 2,176.67 2,176.67 1,901.66 1,960.00 2,026.67 1,780.82 1,785.00 1,785.01 1,815.83 1,846.67 1,846.68 23,228.34 Division of audit and examination 1,358.33 1,758.33 1,758.34 1,618.33 1,458.33 1,348.34 1,393.33 1,499.71 2,165.19 2,499.99 2,591.66 2,281.68 21,731.56 Division of reports and 1,080.00 1,120.00 1,130.00 1,130.00 1,130.00 1,080.00 1,216.00 1,245.50 1,212.50 1,129.59 1,279.75 1,373.69 14,127.03 Division of issue 693.33 693.33 693.34 730.83 768.33 768.34 772.49 776.66 776.68 891.50 986.66 1,041.68 9,593.17 Messengers 395.00 395.00 395.00 395.00 395.00 407.00 455.00 515.00 515.00 507.50 493.33 498.33 5,366.16 Charwomen 60.00 60.00 54.00 60.00 60.00 60.00 63.78 66.00 66.00 66.00 65.27 66.00 747.05 Total 15,704.96 16,068.31 16,029.29 15,694.13 15,636.64 15,519.06 15,463.90 15,650.35 16,242.64 16,717.09 17,115.00 16,997.24 192,838.61 Nonpersonal services: Transportation and subsistence- Board and its clerks.. 23.05 90.83 374.82 172.60 536.19 201.61 251.14 73.85 321.03 126.14 2,171.26 Secretary's office 25.85 171.68 18.00 215.53 Division of audit and examination 190.39 745.20 843.00 136.85 284.62 13.30 211.23 805.57 599.04 1,395.94 1,178.12 603.14 7,006.40 Division of reports and statistics 20.30 40.05 60.35 CoiTnp^l's fffif'c 22.90 22.90 Messengers 5.00 5.00 5.00 5.00 5.00 5.00 30.00 Communication service: TeleDhone 58.62 56.65 75.40 128.26 188.94 207.52 166.53 169.97 174.48 179.17 180.00 180.00 1,765.58 Telegraph 340.18 320.50 343.42 492.12 337.40 525.22 502.98 349.28 711.61 734.21 853.38 801.05 6,311.35 Postage 25.00 25.00 20.00 70.00 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Detailed statement of expenditures—Continued. January. February. March. April. May. June. July. August. te S m e b p e - r. October. No b v er e . m- De b c e e r. m- Total. Printing, binding, etc.o $3,434.62 $1,535.49 $1,446.27 $2,061.15 $1,500.68 $2,789.93 $1,703.58 $1,470.04 $1,996.57 $1,716.63 $1,374.40 $1,485.55 $22,514.91 Contract repairs 3.45 5.00 40.72 15.75 24.97 10.12 2.00 102.01 Electricity (light and power). 30.00 30.00 30.00 30.00 30.00 30.00 30.00 30.00 30.00 30.00 30.00 30.00 360.00 Steam (heat) 15.00 15.00 15.00 15.00 15.00 15.00 15.00 105.00 Other nonpersonal services 36.00 25.00 9.83 56.65 20.00 149.89 22.10 46.20 630.47 103.79 63.92 72.61 1,236.46 Supplies: Stationery 223.94 64.31 124.81 79.76 135.00 110.34 106.64 68.53 107.80 186.16 175.00 117.83 1,500.12 Periodicals 61.98 17.60 17.00 22.50 52 61 10.50 22.00 118.30 16.00 338.49 Other 7.66 24.99 14.07 5.20 21.61 53.05 12.00 21.61 53.00 105.60 67.73 64.61 451.12 Equipment: Furniture and office equipment...0 126.50 85.00 69.50 79.79 223.30 182.05 750.22 160.30 760.78 1,037.90 921.24 71.80 4,468.38 Books 1.50 3.00 38.22 399.47 9.10 12.00 9.75 2.79 11.50 12.46 10.80 510.59 Gold settlement fund (including salaries) 175.29 125.27 235.60 244.40 208.20 240.25 414.30 325.65 447.13 361.52 387.18 375.00 3,539.79 Foreign exchange (including r 1,806.89 1,806.89 Rent 177.93 187.93 188.93 187.93 742.72 Transit (special) 453.76 641.14 38.90 1,133.80 Total 4,758.17 3,617. 90 4,374. 65 3,940.15 3,709.97 4,592. 77 3,947.33 3,756.63 5,819.06 6,535.61 5,455.82 5,955.55 56,463.61 Grand total 20,463.13 19,686.21 20,403.94 19,634.28 19,346.61 20,111.83 19,%411.23 19,406.98 22,061.70 23,252.70 22,570.82 22,952. 79 249,302.22 W O > Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Exhibit H.—EARNINGS AND EXPENSES OF THE FEDERAL RESERVE BANKS. Total earnings of the Federal Reserve Banks for the calendar year 1917 were $15,438,858, compared with $4,955,343 for the calendar year 1916, while total current expenses were $4,235,866, compared with $2,204,344 for the previous year. Current expenses for the year under review include $2,669,585 of expenses of operation proper, $1,111,636—the cost, including postage, expressage, insurance, and other expenses incident to the issue and redemption of Federal Reserve notes and bank notes, $299,823—depreciation of bank buildings, furniture, and equipment, and $154,824 the excess of the cost of operation of the transit department over the total of service charges collected by those Federal Reserve Banks showing a deficit from operation of this department. The total is exclusive of expenses of the fiscal agent departments. These expenses are treated separately, being reimbursed by the United States Treasury Department. Net earnings of the banks, i. e., the excess of earnings over current expenses, totaled $11,202,992, or at the rate of 18.9 per cent on an average aggregate paid-in capital for the year of $59,260,000, compared with 9.8 per cent for the first six months of 1917 and about 5 per cent for the calendar year 1916. It is thus seen that the financial results of operation were especially favorable during the second half of the year when the discount demands upon the Federal Reserve Banks in connection with the loan operations of the Government caused a much larger employment of the banks' funds than during the earlier portion of the year. Three banks report net earnings for the year in excess of 20 per cent on their average paid-in capital; three other banks show net earnings between 15 and 20 per cent, while the remaining six banks show net earnings between 12 and 15 per cent. To the total net earnings above shown should be added the net profits carried over from 1916, $649,302, and miscellaneous adjustments in the profit and loss account amounting to $10,529, making a total of $11,862,823. Deductions from this total, $1,633,914, comprise the cost of notes paid for but not yet issued by the banks, the premium on United States bonds, also special funds set aside to cover depreciation on United States securities owned by the banks, leaving $10,228,909 as the net profits on December 31, 1917. Over two-thirds of this amount, or $6,801,726, represents the amount of dividends paid to member banks during the year, including certain small adjustments in the dividend account. The balance of $3,427,183 was dis- 145 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

146 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. tributed as follows: $1,134,234 was paid by six banks as franchise tax to the Government; an equal amount was carried by these banks to surplus, while $1,158,715 was carried to profit and loss by the other six banks. Over 45 per cent of the total earnings for the year, as against 20.7 per cent the year before, was from bills discounted; 32 per cent, as against 31.5 per cent, from acceptances bought in the open market; 15.3 per cent, as against 22.3 per cent, from United States securities; about 3 per cent came from the sale of transfer drafts; and the remainder from municipal warrants, profits on United States securities sold, penalties for deficient reserves, commissions, and sundry smaller profits. Expenses of operation of the banks proper, exclusive of their transit and fiscal agent departments, were $2,669,585, compared with $1,684,501 for the calendar year 1916. Of the total, about 28 per cent went as compensation to the clerical staff and 23.2 per cent as salaries to bank officers. Less than 9 per cent of the total operating expense is represented by contributions of the banks for the support of the Federal Reserve Board. Rent paid by all banks, except Dallas, constitutes less than 7 per cent of the total expenses of operation, while the cost of printing and stationery accounts for about 5.4 per cent of these expenses. Other large items of operating expense, in the order of their importance, were postage, insurance, directors' fees and per diem allowances, compensation to special officers and watchmen, and salaries not specified. Current expenses are exclusive of $183,764 expended on furniture, fixtures, and vault account. During the year the banks wrote off this account a total of $305,421. At the end of the year the furniture and fixtures account was completely charged off by a number of banks, leaving a balance of $133,396 at the opening of 1918, representing the combined furniture, fixtures, and vault account. The Richmond bank owns a banking house for its branch in Baltimore and ground upon which to build in Richmond. Dallas owns a banking house, while Atlanta and San Francisco own ground on which they propose to erect banking buildings for their own use. The total amount reported at the close of the year by these four banks and Philadelphia under the head of " Bank premises" is $707,611, compared with $368,222 at the beginning of the year. Disbursements of the transit departments, not included in the banks' operating expenses, totaled $844,305. As an offset against these disbursements the banks received $704,670 of service charges for handling items received for collection. Aggregate deficits of $154,824 reported by 7 banks were included among the current expenses of the banks, while excesses of service charges appear among the earnings of 5 banks. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Earnings and expenses of each Federal Reserve Bank and of the system as a whole for the calendar year 1917. EARNINGS. Boston. New York. d P el h p i h la i - a. C la le n v d e . - m R o ic n h d - . Atlanta. Chicago. Lo S u t. is. M ap i o n l n is e . - K C a i n t s y a . s Dallas. c F S i r s a a c n n o - . Total. Bills discounted and bought: Bills discounted—Members and Federal Reserve Banks $571,117 $2,455,533 $370,359 $375,169 $418,629 $231,636 $938,543 $358,239 $311,376 $438,831 $209,065 $292,982 $6,971,470 s Acceptances bought in market.. 502,397 1,843,325 474,653 496,711 201,008 102,311 394,340 170,233 148,531 171,112 138,512 308,596 4,951,729 Investments: United States securities 94,785 378,668 123,875 317,924 96,143 140,820 443,958 110,301 97,936 256,792 159,432 147,355 2,367,989 Municipal warrants 5,203 66,470 18,170 48,132 560 3,629 30,880 13,691 4,479 5,137 6,833 11,935 215,119 Profits realized on United States securities... 11,102 14,335 13,768 24,261 25,569 25,196 4,008 11,250 146,201 Transfers—Net earnings 108 339 14,022 16,712 17,134 170,634 57,920 45,983 45,570 34,027 64,363 450,100 Deficient reserve penalties, including interest 6,105 18,565 6,878 17,844 13,527 12,223 14,968 4,468 37,396 12,968 18,222 194,526 31,362 Commissions received 6,938 38,538 45,476 Net service charges received in excess of transit department disbursements 4,387 1,564 2,726 6,129 383 15,189 W ft Sundry profits 253 32,857 7,917 3,181 1,208 7,196 4,940 8,696 9,436 1.112 4,202 52 81,050 CO w Total earnings 1,198,008 4,848,291 1,015,959 1,297,244 770,009 541,822 2,022,278 736,774 628,338 955,950 569,430 854,755 15,438,858 fed W o Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Earnings and expenses of each Federal Reserve Bank and of the system as a whole for the calendar year 1917—Continued. CURRENT EXPENSES. 00 San Boston. New York. d P el h p i h la i - a. C la le n v d e . - m R o ic n h d - . Atlanta. Chicago. Lo S u t. is. M ap i o n l n i e s. - K C a i n t s y a . s Dallas. F ci r s a c n o - . Total. Expenses of operation: Assessments account expenses Federal Reserve Board $21,226 $50,252 $22,057 $25,783 $14,256 $10,154 $30,021 $12,733 $10,196 $13,118 $11,439 $16,560. $237,795 Federal Advisory Council (fees and traveling expenses) 445 650 350 653 432 479 827 405 150 370 150 150 5,061 Governors' conferences (including traveling expenses) 539 552 174 251 337 300 432 711 625 665 398 944 5,928 Federal Reserve agents' conferences (including traveling expenses) 110 167 243 113 208 215 996 Salaries— Bank officers 43,550 129,247 46,206 46,678 33,200 36,471 63,761 48,688 37,101 37,782 41,051 56,657 620,392 Clerical staff 49,039 228,485 42,615 44,861 35,303 37,893 85,865 55,236 31,926 38,773 39,940 56,891 746,827 Special officers and watchmen 604 11,017 8,311 4,357 700 3,424 10,289 2,127 1,667 1,419 2,762 434 47,111 Allother 29,534 2,541 1,882 5,138 2,043 816 1,062 2,981 160 46,157 Directors' fees 4,060 12,090 3,590 2,120 3,020 2,188 2,050 5,450 3,740 3,975 1,575 2,372 46,230 Per diem allowance 1,010 950 1,080 1,320 1,230 2,540 590 1,640 940 2,540 815 465 15,120 Traveling expenses 711 1,344 1,361 1,571 1,806 2,471 961 1,843 1,506 5,313 1,132 20,019 Officers' and clerks' traveling expenses 921 2,605 163 954 1,067 1,227 1,219 361 1,203 1,139 3,825 15,353 Legal fees 2,400 1,700 2,000 500 600 2,750 1,500 775 2,400 1,323 15,948 Rent 15,246 55,551 9,070 16,625 5,807 12,153 22,915 13,077 5,660 8,850 13,669 178,623 Taxes and fire insurance 430 13 2,629 1,211 74 1,184 104 5,645 Telephone 4,452 6,464 2,803 1,694 685 535 1,906 711 1,031 810 870 2,313 24,274 Telegraph 565 3,216 325 817 657 843 815 769 699 565 585 2,371 12,229 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

5,507 17,374 1,470 7,940 5,210 6,826 14,362 9,477 6,552 3,166 3,203 89,925 3,036 12,907 U86 4,692 4,116 2,483 9,510 2,906 5,030 1,234 8,424 61,112 Insurance and premiums on fidelity bonds 2,647 4,994 4,700 7,416 2,202 2,032 5,876 2,101 2,070 1,871 3,851 3,437 43,197 Light, heat, and power 1,651 1,426 725 820 175 2,397 1,185 1,468 464 10,311 Printing and stationery 8,004 35,067 7,311 7,544 9,723 7,063 18,002 4,926 7,475 7,314 12,180 18,407 143,016 Repairs and alterations 1,289 1,039 233 11,296 28 528 386 1,267 287 2,473 1,506 29,160 % All other expenses 26,191 100,830 9,183 5,404 4,683 15,812 37,578 11,490 4,602 17,388 5,029 10,966 249,156 5 Total expenses of operation... 193,531 704,278 163,955 194,941 141,095 146,748 318,043 177,938 125,101 155,337 145,220 203,396 2,669,585 r • Cost of Federal Reserve notes issued, including expressage, insurance, etc 68,954 343,765 70,340 91,256 54,808 159,825 49,363 42,381 48,679 30,911 34,998 1,054,183 ^ Miscellaneous charges account note issues 15,010 1,887 3,069 3,626 2,314 1,229 1,355 20,886 8,077 57,453 ^ Depreciation of furniture and equipment 14,974 3,782 30,232 25,726 8,177 32,225 41,364 38,353 32,325 28,142 261,388 § Depreciation of bank premises 28,435 2,500 7,500 38,435 ^ Disbursements of transit depart- I ment in excess of net service charges received 8,256 66,283 22,120 14,594 2,277 8,196 33,098 154,824 gj Total current expenses 285,715 1,129,336 262,084 334,092 257,785 214,510 512,407 234,618 210,201 271,451 215,956 307,711 4,235,866 Net earnings for year 1917 912,293 3,718,955 753,875 963,152 512,224 327,312 1,509,871 502,156 418,137 684,499 353,474 547,044 11,202,992 J^ Per cent of average paid-in capital.. 17.4 28.2 14.1 14.9 14.8 13.2 20.6 15.9 16.8 21.8 12.9 13.7 18.9 | W CO Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Profit and loss account of each Federal Reserve Bank and of the system as a whole for the calendar year 1917. Boston. Y N o e r w k. d P el h p i h la i - a. C la le n v d e . - m R o ic n h d - . Atlanta. Chicago. Lo S u t. is, M ap i o n l n i e s. - K C a i n ty sa . s Dallas. Sa c n i s F co ra . n- Total. Earnings $1,198,008 $4,848,291 $1,015,959 $1,297,244 $770,009 $541,822 $2,022,278 $736,774 $628,338 $955,950 $569,430 $854,755 $15,438,858 Current expenses 285,715 1,129,336 262,084 834,092 257,785 214,510 512,407 234,618 210,201 271,451 215,956 307,711 4,235,866 Net earnings for year 912,293 3,718,955 753,875 963,152 512,224 327,312 1,509,871 502,156 418,137 684,499 353,474 547,044 11,202,992 Profit and loss account Jan. 1,1917 11,597 163,064 89,966 94,797 11,664 10,120 61,978 12,748 44,542 91,506 41,903 15,417 649,302 Miscellaneous adjustments in profit and loss d urine vear 10,654 2,127 2 -2,127 i 125 10,529 Total 923,890 3,892,673 843,841 1,057,949 523,888 337,432 1,573,976 514,904 460,552 775,880 395,377 562,461 11,862,823 Less: Cost of Federal Reserve currency not yet issued to bank (including expressage, insurance, etc.).. 33,667 445,248 14,320 43,001 42,508 578,744 Premium on United States bonds. 209,470 159,515 75,462 1,407 445,854 Reserved for depreciation on United States bonds 138,267 205,880 50,000 24,909 77,603 3 21. fi57 91,000 609,316 7 Total deductions 171,934 651,128 209,470 50,000 39,229 280,119 21,657 117,970 1,407 91,000 1,633,914 Net profits Dec. 31,1917 751,956 3,241,545 843,841 848,479 473,888 298,203 1,293,857 514,904 438,895 657,910 393,970 471,461 10,228,909 Dividends paid 597,829 1,941,642 622,150 715,614 240,944 215,972 860,058 284,566 363,876 360,236 187,744 394,490 6,785,121 Dividends accrued and paid on surrendered stock including miscellaneous adjustments in dividend account 3,927 1,177 1,453 554 2,231 2,201 19 4,267 490 286 16,605 Total dividends paid during year 601,756 1,942,819 623,603 716,168 240,944 218,203 862,259 284,566 363,895 364,503 188,234 394,776 6,801,726 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Profit and loss Pec. 31,1917, after payment of dividends 150,200 1,298,726 220,238 132,311 232,944 80,000 431,598 230,338 75,000 293,407 205,736 76,685 3,427,183 Distribution of profit and loss: Paid to Government account franchise tax 75,100 649,363 116,472 40,000 215,799 37,500 1,134,234 Carried to surplus account 75,100 649,363 116,472 40,000 215,799 37,500 1,134,234 Profit and loss Jan. 1 1918 220,238 132,311 230,338 293,407 205,736 76,685 1,158,715 Dividends paid to 12-31-17 12-31-17 6-30-17 6-30-17 12-31-17 12-31-17 12-31-17 12-31-16 12-31-17 6-30-17 6-30-17 12-31-16 1 Credit. 2 Amount paid to the Chicago Federal Reserve Bank in adjustments of dividends due to banks transferred from the Minneapolis to the Chicago district. 8 Includes $6,500 for abrasion on gold coin. o w H O W o > Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Transit department disbursements and net service charges of each Federal Reserve Bank and of the system as a whole for the calendar year 1917. DISBURSEMENTS. Boston. Y N o ew rk - . d P el h p i h la i - a. C la le n v d e . - m R o ic n h d - . Atlanta. Chicago. St. Louis. M ap i o n l n is e . - K C a i n t s y a . s Dallas. Sa c n i s F c r o a . n- Total. Expenses of operation: Salaries- B Bank officers $3,563 $3,000 $469 $725 $2,169 $9,926 3 Clerical staff $51,854 $58,871 $55,134 39,950 29,254 20,279 $35,042 15,868 $23,799 $28,631 27,292 $28,922 414,896 8 Allother 228 52 655 941 Officers' and clerks traveling expenses. 631 213 201 1,045 Legal fees 185 37 1,098 1,320 Rent 7,041 6,590 1,630 2,232 1,200 2,750 5,013 1,445 3,000 1,600 750 33,251 Taxes and fire insurance 65 35 204 60 28 392 H Telephone 53 57 55 36 288 247 48 26 24 834 Telegraph 61 345 32 1 15 78 104 127 312 1,075 Postage 19,157 22,294 17,939 12,626 10,659 8,278 8,578 7,799 8,951 17, $44 9,353 9,769 152,947 Expressage 8,027 28,850 11,756 66 480 11 466 2,301 14,262 67,188 Insurance and premiums on fidelity bonds 1,391 130 240 656 525 815 6,052 Light, heat, and power 1,585 235 138 747 148 600 5,118 304 240 9,481 Printing and stationery 5,350 10,942 3,780 5,790 2,271 2,294 6,157 19 4,121 3,133 4,924 5,077 53,858 Repairs and alterations 107 118 420 48 2,106 152 52 356 3,359 All other expenses, not specified 1,938 17,746 4,652 2,819 5,033 4,449 726 544 1,714 3,200 43,707 Total expenses of operation 96,132 147,206 96,883 68,812 48,498 39,498 60,886 34,692 41,361 52,465 49,694 64,145 800,272 § Depreciation ol furniture and equipment 4,818 15,754 2,688 10,746 1,640 3,100 2,441 2,846 44,033 fe Total disbursements 96,132 147,206 101,701 84,566 51,186 50,244 60,886 36,332 44,461 54,906 52,540 64,145 844,305 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

SERVICE CHARGES. Member banks , $86,670 $128,271 $93,507 $60:964 $43,028 $30,042 $110,243 $48,994 $32,821 $15,714 $28,945 $13,864 $693,063 Other Federal Reserve Banks 12,139 17,762 16,048 26,017 22,592 25,091 17,529 22,299 20,542 34,603 25,445 20,001 260,068 Total service charges received , 98,809 146,033 109,555 86,981 65,620 55,133 127,772 71,293 53,363 50,317 54,390 33,865 953,131 Service charges paid other Federal Reserve Banks , 10,933 65,110 29,974 17,009 10,047 7,166 65,322 32,235 2,773 3,607 1,467 2,818 248,461 Service charges, net 87,876 80,923 79,581 69,972 55,573 47,967 62,450 39,058 50,590 46,710 52,923 31,047 704,670 Transit department disbursements in excess of net service charges received 8,256 66,283 22,120 14,594 !4,387 2,277 i 1,564 1 2,726 16,129 8,196 1383 33,098 139,635 g i Excess service charges. Fiscal agent department disbursements of each Federal Reserve Bank, amounts reimbursed, and balances reimbursable by the United States Treasury, to the end of the calendar year 1917. Boston. Y N o ew rk - . d P el h p i h la i - a. C la le n v d e . - m R o ic n h d - . Atlanta. Chicago. St. Louis. M ap i o n l n is e . - K C a i n ty sa . s Dallas. Sa c n is F co ra . n- Total. Total disbursements to Dec. 31, 1917 $294,499 $900,040 $186,008 $237,581 $66,921 $70,380 $458,278 $191,516 $106,338 $114,172 $92,798 $376,219 $3,094,750 Amounts reimbursed by United States Treasury to Dec 31 1917 151,288 539,690 85,975 98,333 23,700 24,686 170,850 66,667 52,211 27,722 27,793 128,615 1,397,530 Balances reimbursable 143,211 360,350 100,033 139,248 43,221 45,694 287,428 124,849 54,127 86,450 65,005 247,604 1,697,220 i w o J Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Cost of furniture and equipment, including vaults, also bank premises. Boston. Y N o e r w k. d P el h p i h la i - a. C la le n v d e . - m R o ic n h d - . Atlanta. Chicago. St. Louis. M ap i o n l n i e s. - K C a i n ty sa . s Dallas. Sa c n i s F c r o a . n- Total. Balance as reported Jan. 1,1917 $15,410 $20,164 $12,000 $12,282 i $28,109 $28,6£9 $59,274 $41,961 $37,164 i $255,053 Additional purchases during calendar year ending Dec. 31,1917 $14,974 18,771 25,822 25,479 6 641 4,116 23,538 14,691 12,583 9,007 $28,142 183,764 Total . . 14,974 34,181 45,986 37,479 18,923 32,225 52,227 73,965 54,544 46,171 28,142 438,817 Depreciation charged during calendar year ending Dec. 31,1917 14,974 8,600 45,986 28,414 18,923 32,225 7,728 44,464 40,794 35,171 28,142 305,421 Balance Jan. 1 1918 ... 25,581 9,065 44,499 29,501 13,750 11,000 133,396 § "RjvnV promises . ....... '. .r.r 10,000 300,000 140,875 136,736 120,000 707,611 i Refund of $195.50 deducted. w o Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Cost of unissued Federal Reserve notes. Boston. Y N o e r w k. d P el h p i h la i - a. C la le n v d e . - m R o ic n h d - . Atlanta. Chicago. St. Louis. M ap i o n l n i e s. - Ka C n i s ty a . s Dallas. San c is F c r o a . n- Total. Balance as reported Jan. 1,1917 $29,230 $235,599 $27,708 $39,544 $9,355 $20,315 $67,958 $19,763 $16,295 i $28,599 $8,940 i $503,306 Additional cost during calendar year ending Dec. 31,1917 73,391 553,414 43,144 51,712 49,548 49,401 134,868 45,767 39,001 62,588 32,132 $34,998 1,169,964 Total 102,621 789,013 70,852 91,256 58,903 69,716 202,826 65,530 55,296 91,187 41,072 34,998 1,673,270 Cost of Federal Reserve notes charged to current expenses during calendar year o ending Dec. 31,1917 102,621 789,013 70,340 91,256 58,903 69,128 202,826 49,363 42,381 91,187 30,911 34,998 1,632,927 Balance Jan. 1,1918 512 588 16,167 12,915 10,161 40,343 O 1 Includes cost of Federal Reserve bank notes amounting to $983.82. »=1 fel' i w o > Or Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Earnings and current expenses, by months, for the calendar year 1917, of each Federal Reserve Bank and of the system as a whole. Or EARNINGS. Boston. Y N o e r w k. d P el h p i h la i - a. C la le n v d e . - m R o ic n h d - . Atlanta. Chicago. St. Louis. M ap i o n l n is e . - K C a i n ty sa . s Dallas. F S r a a n n- Total. cisco. January 153,987 $120,886 $48,394 $65,114 $44,597 $47,800 $31,400 $32,121 $29,731 $20,826 $49,982 $633,806 February.. 43,978 109,043 45,091 52,713 35,136 26,584 68,040 31,283 31,310 31,311 24,678 34,413 533,880 March 45,168 91,582 44,794 51,150 37,496 21,128 63,591 33,052 31,094 34,889 22,943 31,090 507,977 April 53,134 107,644 47,812 54,016 44,603 23,870 68,272 35,947 34,082 34,955 28,886 38,725 571,946 s May 53,867 156,521 72,047 66,220 55,669 28,271 89,149 43,806 43,184 42,511 34,747 52,476 738,468 June 89,452 437,386 78,704 73,082 58,850 28,873 136,407 47,167 39,952 72,814 33,119 59,645 1,155,451 July 104,597 389,244 87,023 78,742 66,862 26,861 192,247 53,281 49,422 88,498 36,581 62,530 1,235,888 August 110,323 233,893 90,314 107,090 65,074 33,380 160,522 55,826 60,826 97,756 45,805 75,312 1,136,121 September.. 108,553 315,977 95,853 117,730 68,800 44,330 170,449 66,900 70,234 92,918 53,031 80,282 1,285,057 October 126,746 672,011 85,419 131,306 69,299 73,964 247,193 91,293 58,689 106,034 79,296 91,571 1,832,911 November. 161,013 1,033,209 122,933 193, 726 85,379 85,520 336,516 96,824 83,836 166,516 88,510 119,352 2,573,334 December.. 247,190 1,180,895 197,575 306,265 133,557 101,241 399,360 147,269 87,459 158,017 100,625 159,377 3,218,830 Total 1,198,008 4,848,291 1,015,959 1,297,244 765,622 541,822 2,020,714 734,048 622,209 955,950 569,047 854, 755 15,423,669 Net service charges in excess of transit department disbursements 4.387 1,564 2,726 6,129 383 15,189 Total earnings. 1,198,008 4, 848,291 1,015,959 1,297,244 770,009 541,822 2,022,278 736,774 628,338 955,950 569,430 854,755 15,438,858 o Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

CURRENT EXPENSES. January 111,736 $53,558 $11,354 $12,104 $10,395 $10,972 $18,968 $12,428 $7,705 $11,040 $10,022 $11,244 $181,526 February 14,088 61,972 15,548 15,153 8,147 11,424 23,194 12,183 9,892 11,085 9,271 11,416 203,373 March 14,908 66,284 15,340 15,207 8,^72 10,882 25,960 11,391 8,995 12,537 9,407 10,984 210,567 April 15,667 61,834 15,703 18 178 8,779 10,631 31,639 11,677 11,889 12,374 9,994 11,076 219,441 May 14,656 58,375 15,145 20,215 10,483 10,566 34,175 15,228 11,166 13,078 8,988 11,262 223,337 June 18,226 65,532 19,226 23,006 77,994 9,717 30,258 14,495 11,288 11,789 25,627 33,481 340,639 July 20,785 73,825 13,530 20,731 11,867 12,753 60,844 16,194 13,378 15,934 10,921 17,132 287,894 August 22,077 90,565 18,098 17,048 10,567 13,232 36,949 15,961 12,608 18,415 13,579 20,259 289,358 September 24,428 96,832 23, 618 24,934 12,425 25,957 43,408 19,883 18,533 26,535 24,952 20,612 362,117 3 O ctober 29,841 136,796 28,240 28,244 11,337 29,502 51,845 33,690 24,655 32,187 23,017 26,830 456,184 November 30,815 157,874 25,456 33,251 16,171 23,787 59,441 34,034 17,977 31,980 17,810 24,994 473,590 December 60,232 139,606 38,706 91,427 70,948 '42,810 95,726 37,454 62,115 66,301 52,368 75,323 833,016 Total 277,459 1,063,053 239,964 319,498 257,785 212,233 512,407 234,618 210,201 263,255 215,956 274,613 4,081,042 Transit department disbursements in excess of net service charges received 66,283 22,120 14,594 2,277 8,196 33,098 154,824 Total current expenses 285,715 1,129,336 262,084 334,092 257,785 214,510 512,407 234,618 210,201 271,451 215,956 307,711 4,235,866 NOTE.—Increases in current expenses shown for the months of June and December are due to the inclusion of special charges account depreciation of furniture and equipment, also cost of Federal Reserve currency during these two months. g W O C7I Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Exhibit I.—STATE BANKS AND TRUST COMPANIES AD- MITTED TO MEMBERSHIP. The following list shows the State banks and trust companies which have been admitted to membership in the Federal Reserve system up to and including December 31, 1917: Capital. Surplus. T s o o t u a r l c e r s e . - Alabama: Birmingham—American Trust & Savings Bank. $500,000 $250,000 $5,836,700 Eufaula—Bank of Eufaula 100,000 14,000 378,828 Marion—Marion Central Bank 50,000 100,000 497,661 Montgomery—Sullivan Bank <fc Trust Co 250,000 25,750 605,582 Total 900,000 389,750 7,318,771 Colorado: Denver—International Trust Co 500,000 500,000 13,803,659 Connecticut: Bridgeport—Bridgeport Trust Co 500,000 300,000 7,866,545 650,000 500,000 4,574,303 New Haven—Union & New Haven Trust Co 1,150,000 800,000 12,440,848 Total 1,000,000 500,000 13,141,081 Delaware: Wilmington—Wilmington Trust Co 1,000,000 100,000 4,289,237 District of Columbia: Washington—Continental Trust Co. Florida: 100,000 100,000 1,217,318 250,000 500,000 3,5,50,995 Deland—Volusia County Bank TaTmoptaa—l.Citizens Bank & Trust Co 350,000 600,000 4,768,313 Georgia: Athens—American State Bank 100,000 20,000 538,635 Atlanta- Central Bank & Trust Corporation 1,000,000 300,000 9,620,109 Trust Company of Georgia 1,000,000 1,000,000 3,893,161 Brunswick—Brunswick Bank & Trust Co. 100,000 72,000 1,049,176 Savannah- Citizens & Southern Bank 1,000,000 1,000,000 18,537,851 Savannah Bank & Trust Co 630,000 570,000 8,415,862 West Point Citizens Bank 50,000 172,477 Total. 3,880,000 2,962,000 42,227,271 Idaho: Genesee—Genesee Exchange Bank. 25,000 12,500 482,091 Kimberly—Bank of Kimberly 35,000 10,250 389,592 Total. 60,000 22,750 871,683 Illinois: Chicago- Austin State Bank 200,000 60,000 2,668,743 Central Trust Co. of Illinois. 6,000,000 1,000,000 54,074,035 Chicago Savings Bank & Trust Co. 1,000,000 200,000 12,733,891 First Trust & Savings Bank 5,000,000 5,000,000 84,207,394 Foreman Bros. Banking Co 1,500,000 500,000 18,141,352 Harris Trust & Savings Bank 2,000,000 2,000,000 33,570,255 Hyde Park State Bank 200,000 50,000 1,840,530 Kaspar State Bank 500,000 300,000 6,476,754 Merchants Loan & Trust Co 3,000,000 8,000.000 109,517,884 Noel State Bank 300,000 75,000 2,428,746 Standard Trust & Savings Bank... 1,000,000 500,000 9,980,043 State Bank of Chicago 1,500,000 3,000,000 38,004,507 Union Trust Co 1,500,000 1,500,000 37,348,934 United State Bank of Chicago 200,000 30,000 869,220 158 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

ANNUAL REPOBT OF THE FEDERAL RESERVE BOARD. 159 Capital. Surplus. T so o u ta rc l e r s e . - Illinois—Continued. Cicero Kirohman State Bank $100,000 $25,000 $613,746 Effingham Effingham State Bank 50,000 10,000 721,719 Elmhurst—Elmhurst State Bank .. 60,000 25,000 '703,766 Evanston— State Bank of Evanston 150,000 200,000 4,142,457 Joliet— Commercial Trust & Savings Bank.. 100,000 5,000 569,684 Joliet Trust & Savings Bank 100,000 25,000 766,311 Kewanee—Union State Savings Bank & Trust Co 100,000 25,000 1,170,562 Martinsville—Martinsville State Bank 50,000 17,000 388,031 Oak Park Suburban Trust & Savings Bank 100,000 10,000 379,251 Quincy State Savings Loan & Trust Co 1,000,000 8,092,397 Total. 25,710,000 22,557,000 429,410,312 Indiana: Elkhart—St. Joseph Valley Bank 100,000 50,000 2,484,247 Kentland Discount & Deposit State Bank 70,000 35,000 549,592 Paoli Paoli State Bank 25,000 750 194,868 Total 195,000 85,750 3,228,707 Iowa: Brighton—Brighton State Bank 50,000 10,000 672,810 Cedar Falls—Security Trust & Savings Bank 50,000 5,000 919,170 Clinton—Peoples Trust & Savings Bank 300,000 300,000 5,179,745 Des Moines—Iowa Loan & Trust Co 500,000 100,000 7,436,044 Gilman—Citizens Savings Bank 25,000 11,000 383,807 Mason City—Commercial Savings Bank 100,000 14,000 1,117,161 Ottumwa—Ottumwa Savings Bank 100,000 30,000 1,205,090 Sioux City—Bankers Loan & Trust Co 100,000 5,000 277,320 Sutherland First Savings Bank 50,000 320,203 Vail—Farmers State Bank 50,000 8,000 264,041 Total. 1,325,000 483,000 17,775,391 Kansas: Fairview—Fairview State Bank 30,000 15,000 291,985 Fort Scott Fort Scott State Bank 100,000 26,000 748,859 Hiawatha—Morrill & Janes Bank 100,000 50,000 1,143,410 Wichita—Southwest State Bank 200,000 9,000 1,521,337 Total. 430,000 100,000 3,705,591 Kentucky: Louisville—German Insurance Bank 250,000 500,000 7,307,484 Maysville—First Standard Bank & Trust Co 175,000 60,000 1,418,794 Mount Sterling—Exchange Bank of Kentucky 50,000 25,000 434,572 Total.- -. 475,000 585,000 9,160,850 Louisiana: Gretna—Jefferson Trust & Savings Bank 30,000 20,000 402,332 Iota—Bank of Iota 25,000 114,204 New Orleans- Canal Bank & Trust Co 2,000,000 500,000 21,210,372 Hibernia Bank & Trust Co. - 1,500,000 2,000,000 25,881,516 Interstate Trust & Banking Co 750,000 500,000 9,171,943 Metropolitan Bank.. 400,000 200,000 4,077,889 Total. . 4,705,000 3,220,000 60,858,256 Maryland: Baltimore— Baltimore Commercial Bank 500,000 100,000 2,668.945 Baltimore Trust Co 1,000,000 2,000,000 15,990,745 Maryland Trust Co 1,000,000 8,974,128 Total 2,500,000 2,100,000 27,633,818 Massachusetts: Boston- 1,000,000 2,000,000 25,578,848 Commonwealth Trust Co ... 1,000,000 500,000 24,001,520 International Trust Co 1,500,000 1,500,000 23,933,840 Metropolitan Trust Co 300,000 300,000 5,787,080 Old Colony* Trust Co... 6,000,000 7,000,000 150,784,124 Cambridge—Charles River Trust Co 200,000 200,000 2,893,283 Fitch burg—Fitchburg Bank & Trust Co 500,000 250,000 4,935,072 Newton—Newton Trust Co 400,000 400,000 • 4,889,053 Norwood—Norwood Trust Co 200,000 2,563,580 Winchester—Winchester Trust Co 100,000 25,000 731,236 Worcester—Worcester Bank & Trust Co 1,250,000 500,000 24,123,410 Total 12,450,000 12,675,000 270,221,046 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

160 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. Total re- Capital. Surplus. sources. Michigan: Albion—Commercial & Savings Bank $75,000 $40,000 $798,485 Charlotte—Eaton County Savings Bank 100,000 20,000 925,622 Detroit- First State Bank 500,000 150,000 8,275,489 Peninsular State Bank ,500,000 1,000,000 27,270,333 Peoples State Bank ,500,000 2,500,000 71,761,759 The Dime Savings Bank ,000,000 1,000,000 32,769,194 Wayne County & Home Savings Bank ,000,000 3,000,000 53,681,743 Detroit Savings Bank 750,000 750,000 19,524,470 Central Savings Bank 500,000 100,000 11,962,743 American State Bank 500,000 185,130 7,243,617 Flint- Citizens Commercial & Savings Bank 150,000 175,000 3,438,805 Union Trust & Savings Bank 100,000 135,000 3,848,355 Industrial Savings Bank 250,000 250,000 4,307,935 Fremont—Old State Bank 50,000 25,000 875,831 Gladstone—State Savings Bank 50,000 15,000 571,986 Grand Haven—Grand Haven State Bank 75,000 50,000 1,662,949 Grand Rapids- Grand Rapids Savings Bank 400,000 350,000 8,479,169 Kent State Bank 500,000 500,000 9,419,740 Hart—Oceana County Savings Bank 40,000 13,000 427,901 Highland Park—Highland Park State Bank 1,000,000 400,000 20,976,678 Hudson—Boies State Savings Bank 75,000 25,000 734,295 Jackson- Central State Bank 100,000 26,000 1,062,781 Union Bank of Jackson 400,000 100,000 4,388,130 Lansing—Lansing State Savings Bank 150,000 100,000 2,632,821 Lapeer—Lapeer Savings Bank 50,000 10,000 545,282 Monroe—B. Dansard & Sons' State Bank 100,000 20,000 1,627,265 Mount Pleasant—Exchange Savings Bank 50,000 30,000 791,176 Niles—Niles City Bank 100,000 20,000 699,175 Petersburg—H. C. McLachlin & Co. State Bank. 25,000 5,000 362,541 Port Huron—St. Clair County Savings Bank 100,000 50,000 1,319,436 Rochester—Rochester Savings Bank 50,000 10,000 556,346 Romeo—Romeo Savings Bank 50,000 30,000 1,081,181 Saugatuck—Fruit Growers State Bank 50,000 10,000 476,786 Sauft Ste. Marie—Sault Savings Bank 100,000 35,000 1,140,382 St. Clair—Commercial & Savings Bank 50,000 10,000 746,874 Total. 15,490,000 11,139,130 306,387,276 Minnesota: Minneapolis- Bankers Trust & Savings Bank... 1,000,000 200,000 2,197,403 German American Bank 200,000 200,000 4,689,159 St. Anthony Falls Bank 300,000 60,000 3,763,0G2 St. Paul—Peoples Bank 300,000 50,000 2,280,204 Spring Valley—Farmers State Bank... 25,000 5,000 149,092 Winona—Merchants Bank of Winona. 100,000 50,000 2,581,970 Total. 1,925,000 565,000 15,660,800 Mississippi: Summit—Union Bank of Pike. 25,000 4,000 165,516 Missouri: Kansas City- Commerce Trust Co 000,000 750,000 32,897,159 Fidelity Trust Co 000,000 1,000,000 14,461,776 St. Louis- Franklin Bank 600,000 700,000 8,961,674 German American 000,000 700,000 9,239,685 German Savings Institution 500,000 1,000,000 19,261,222 International Bank of 500,000 500,000 6,981,718 Lafayette South Side Bank 800,000 400,000 12,604,870 Mercantile Trust Co 000.000 6,500,000 40,732,458 Mississippi Valley Trust Co 000,000 3,500,000 30,414,523 St. Louis Union Bank 500,000 2,500,000 44,389,921 Total. 14,900,000 17,550,000 219,945,006 Montana: Helena—Conrad Trust & Savings Bank 200,000 80,000 3,042,678 Hingham—Hingham State Bank 35,000 335,296 Opheim—First State Bank 25,000 5,000 229,183 Sidney—Yellowstone Valley Bank & Trust Co. 100,000 5,000 748,601 Total 360,000 90,000 4,355,758 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. 161 Total re- Capital. Surplus. sources. Nebraska: Lewellen—Bank of Lewellen. $25,000 $10,000 $250,820 Pender—Ponder State Bank.. 50,000 3,000 403,036 Total. 75,000 13,000 653,856 New Jersey: Bloomfield—Bloomfleld Trust Co 200,000 100,000 3,213,787 Camden—Camden Safe Deposit & Trust Co. 500,000 800,000 10,352,726 Montclair—Bank of Montclair 100,000 80,000 2,799,827 Passaic—Passaic Trust & Safe Deposit Co... 200,000 100,000 7,130,181 Plainfield—Plainfield Trust Co 300,000 200,000 8,749,434 Rah way—Rahway Trust Co 100,000 25,000 398,277 Westfield—Peoples Bank & Trust Co 100,000 80,000 2,005,718 Total. 1,500,000 1,385,000 34,649,950 New York: Batavia—The Bank of Genesee 100,000 100,000 1,151,907 Brooklyn- Brooklyn Trust Co 1,500,000 2,898,481 40,270,926 Franklin Trust Co 1,000,000 1,000,000 24,823,842 Manufacturers Trust Co 1,000,000 300,000 15,031,812 Peoples Trust Co 1,000,000 1,000,000 29,443,301 Buffalo- Buffalo Trust Co 500,000 500,000 9,621,217 Citizens Commercial Trust Co 1,250,000 1,250,000 18,196,063 New York- Bankers Trust Co 11,250,000 11,250,000 327,011,784 Bank of America 1,500,000 6,000,000 60,903,035 Broadway Trust Co 1,500,000 750,000 34,726.703 Central Trust Co 5,000,000 15,000,000 209,953,374 Columbia Trust Co 5,000,000 5,000,000 124,186,774 Corn Exchange Bank 3,500,000 6,991,165 153,989,100 Equitable Trust Co 6,000,000 10,500,000 230,210,148 Fidelity Trust Co 1,000,000 1,000,000 13,965,146 German American Bank 750,000 250,000 8,404,825 Germania Bank of the City of 400,000 600,000 8,731,766 Guaranty Trust Co 25,000,000 25,000,000 613,535,033 Manhattan Co 2,050,000 4,500,000 82,094,144 Mercantile Trust & Deposit Co 1,000,000 • 500,000 8,593,786 Metropolitan Bank 2,000,000 1,000,000 28,801,800 Metropolitan Trust Co 2,000,000 4,000,000 63,853,782 New York Trust Co 3,000,000 10,000,000 90,773,776 Pacific Bank 500,000 500,000 13,907,579 Scandinavian Trust Co 1,000,000 1,500,000 11,359,362 Union Trust Co 3,000,000 4,500,000 87,043, 831 U. S. Mortgage & Trust Co 2,000,000 4,000,000 92,377,698 W. R. Grace & Co.'s Bank 500,000 500,000 6,675,523 United States Trust Co 2,000,000 12,000,000 77,455.087 Ogdensburgh—St. Lawrence Trust Co 100,000 25,000 823,362 Utica— Citizens Trust Co 500,000 400,000 10,641,931 Oneida County Trust Co '250,000 250,000 2,428,746 Utica Trust & Deposit Co 400,000 200,000 11,850,975 Watertown—Northern New York Trust Co 400,000 400,000 7,151,603 Oneida—Madison County Trust & Deposit Co.. 164,100 94,870 2,224,326 Rome—Rome Trust Co 300,000 60,000 3,627, 406 Elmira—Chemung Canal Trust Co 600,000 400,000 7,301,858 Syracuse-^City Bank 500,000 148,000 7,442,110 Gloversville—Trust Co. of Fulton County 200,000 100,000 527,339 Total. 89,714,100 134,467,516 2,541,105,483 North Dakota: Enderlin—Enderlin State Bank.., 50,000 10,000 395,259 Hettinger—Hettinger State Bank. 25,000 3,500 282,089 Willliston—Bank of WilUston 50,000 113,071 Total 125,000 13,500 790,419 Ohio: Cleveland— Citizens Savings & Trust Co 4,000,000 4,000,000 74,532,631 Cleveland Trust Co 2,500,000 2,500,000 55,121,784 Guardian Savings & Trust Co 3,000,000 3,000,000 52,731,355 Columbus—Citizens Trust & Savings Bank... 700,000 150,000 5,271,822 Hillsboro—Hillsboro Bank & Savings Co 50,000 12,000 551,959 Massillon—Ohio Banking & Trust Co 150,000 37,500 1,307,036 Newark—Newark Trust Co 200,000 125,000 2,655,417 Steubenville—Steubenville Bank & Trust Co. 125,000 50,000 1,713,784 Toledo—Guardian Trust & Savings Bank 200,000 200,000 4,224,961 Youngstown—City Trust <fe Savings Bank 200,000 150,000 4,752,034 Total. 11,125,000 10,224,500 202,862,783 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

162 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. Total re- Capital. Surplus. sources. Oregon: Hood River—Butler Banking Co $100,000 $20,000 $909,708 North Portland—Live Stock State Bank 100,000 10.000 872,846 Portland-^Ladd & Tilton Bank 1,000,000 1,000,000 21,427,913 Total. 1,200,000 1,030,000 23,210,467 Pennsylvania: Lykens—Miners Deposit Bank 50,000 110,000 679,897 New Castle—Lawrence Savings & Trust Co..; 300,000 300,000 3,183,907 Philadelphia- Commercial Trust Co. . . . . . .. 1,000,000 1,750,000 24,796,108 Girard Trust Co 2,500,000 7,500,000 61,172,461 Philadelphia Trust Co .. . 1,000,000 4,000,000 26,160,684 Penna. Co. for Insurances on Lives and Granting Annuities 2,000,000 5,000,000 43,602,088 Pittsburgh- Pittsburgh Trust Co 2,000,000 1,000,000 21,067,764 Union Trust Co 1,500,000 34,500,000 137,516,868 Total. 10,350,000 54,160,000 318,179,777 Ehode Island: Providence—Industrial Trust Co 3,000,000 4,000,000 71,783,303 South Carolina: Cheraw—Merchants & Farmers Bank 100,000 3,000 338,007 Hartsville—Bank of Hartsville . 50,000 50,000 394,626 Sumter—Peoples Bank of Sumter 100,000 19,400 368,325 Westminster—Westminster Bank 100,000 25,000 453,433 Woodruff—Bank of Woodruff • 40,700 10,500 256,874 Total 390,700 107,900 1,811,265 South Dakota: Sioux Falls—Sioux Falls Savings Bank 200,000 23,000 3,852,236 Tennessee: Memphis—Union & Planters Bank & Trust Co 1,400,000 200,000 15,307,795 Texas: Bonham—First State Bank. 100,000 14,000 543,354 Bremond—First State Bank. 50,000 25,000 232,823 Dallas- Central State Bank. 200,000 5,000 1,698,236 First State Bank 250,000 28,000 3,016, 796 De Kalb—First State Bank 25,000 25,000 '2,638,304 Edgewood—Farmers & Merchants State Bank 35,000 7,000 95,675 Hamlin—First State Bank 25,000 1,750 15S, 894 Lubbock—Lubbock State Bank 100,000 13,000 837,114 Memphis—Citizens State B ank .. 75,000 26,400 377,603 Savoy—First State Bank... . . . 25,000 3,500 120,175 Wolfe City—First State Bank . . 50,000 20,000 235,461 Total. .. 935,000 168,650 9,954,435 Virginia: Chase City—Peoples Bank & Trust Co 100,000 10,000 173,005 Harrisonburg—Peoples Bank of 150,000 20,000 554,154 Norfolk—Citizens Bank ok 600,000 500,000 5,896,002 Richmond—The Savings Bank of 200,000 200,000 2,198,163 Total 1,050,000 730,000 8,821,324 Washington: Bellmgham—Northwestern State Bank 100,000 45^000 1,474,055 Chehalis—Coffman-Dobson Bank & Trust Co 150,000 100,000 1,493,790 Coif ax—First Savings & Trust Co 50,000 15,000 369,711 La Crosse—First State Bank 60,000 8,000 715,454 Reardan—Farmers State Bank... 25,000 7,500 639,855 Rosalia—Bank of Rosalia . . 25,000 5,000 308, 777 Seattle—Metropolitan Bank. 200,000 100,000 3,559, 260 Spokane—Spokane & Eastern Trust Co 1.000,000 200,000 20,078,867 Wilbur—State Bank of Wilbur 50,000 5,000 919,175 Total 1,660,000 485,500 29,556,944 West Virginia: Grafton—Grafton Banking & Trust Co 100,000 30,000 1,180,082 Wisconsin: Clinton—Citizens Bank 50,000 10,000 478,360 Madison—Bank of Wisconsin 300,000 60,000 2,156,438 Milwaukee- Badger State Bank... 200,000 2,000 1,506,471 Marshall & Illsley Bank 1,000,000 700,000 17,405, 264 American Exchange Bank . 250,000 50,000 4,721,622 Total. 1,800,000 822,000 26,268,155 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Exhibit J.—REGULATIONS OF THE FEDERAL RESERVE BOARD. REGULATION A, SERIES OF 1917. (Superseding Regulation A of 1916.) REDISCOUNTS UNDER SECTION 13. A, NOTES, DRAFT, AND BILLS OF EXCHANGE. I. General statutory provisions. Any Federal Reserve Bank may discount for any of its member banks any note, draft, or bill of exchange provided— (a) It lias a maturity at the time of discount of not more than 90 days, exclusive of days of grace; but if drawn or issued for agricultural purposes or based on live stock, it may have a maturity at the time of discount of not more than six months, exclusive of days of grace. (b) It arose out of actual commercial transactions; that is, it must be a note, draft, or bill of exchange which has been issued or drawn for agricultural, industrial, or commercial purposes, or the proceeds of which have been used or are to be used for such purposes. (c) It was not issued for carrying or trading in stocks, bonds, or other investment securities, except bonds and notes of the Government of the United States. (d) The aggregate of notes, drafts, and bills bearing the signature or indorsement of any one borrower, whether a person, company, firm, or corporation rediscounted for any one member bank shall at no time exceed 10 per cent of the unimpaired capital and surplus of such bank; but this restriction shall not apply to the discount of bills of exchange drawn in good faith against actually existing values. (e) It is indorsed by a member bank. (/) It conforms to all applicable provisions of this regulation. II. General character of notes, drafts, and bills of exchange eligible. The Federal Reserve Board, exercising its statutory right to define the character of a note, draft, or bill of exchange eligible for rediscount at a Federal Reserve Bank, has determined that— (a) It must be a note, draft, or bill of exchange the proceeds of which have been used or are to be used in producing, purchasing, carrying, or marketing goods1 in one or more of the steps of the process of production, manufacture, or distribution. (b) It must not be a note, draft, or bill of exchange the proceeds of which have been used or are to be used for permanent or fixed investments of any kind, such as land, buildings, or machinery. (c) It must not be a note, draft, or bill of exchange the proceeds of which have been used or are to be used for investments of a purely speculative character. (d) It may be secured by the pledge of goods or collateral, provided it is otherwise eligible. 1 When used in this regulation the word " goods " shall be construed to include goods, wares, merchandise, or agricultural products, including live stock. 163 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

164 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. III. Applications for rediscount. All applications for the rediscount of notes, drafts, or bills of exchange must contain a certificate of the member bank, in form to be prescribed by the Federal Reserve Bank, that, to the best of its knowledge and belief, such notes, drafts, or bills of exchange have been issued for one or more of the purposes mentioned in II (a). IV. Promissory notes. (a) Definition.—A.promissory note, within the meaning of this regulation, is denned as an unconditional promise, in writing, signed by the maker, to pay, in the United States, at a fixed or determinate future time, a sum certain in dollars to order or to bearer. (b) Evidence of eligibility and requirement of statements.—A Federal Reserve Bank must be satisfied by reference to the note or otherwise that it is eligible for rediscount. Compliance of a note with II (b) may be evidenced by a statement of the borrower showing a reasonable excess of quick assets over certain liabilities. The member bank shall certify in its application whether the note offered for rediscount has been discounted for a depositor or another member bank or whether it has been purchased from a nondepositor. It must also certify wiiether a financial statement of the borrower is on file. Such financial statements must be on file with respect to all notes offered for rediscount which have been purchased from sources other than a depositor or a member bank. With respect to any other note offered for rediscount, if no statement is on file, a Federal Reserve Bank shall use its discretion in taking the steps necessary to satisfy itself as to eligibility. It is authorized to waive the requirement of a statement wih respect to any note discounted by a member bank for a depositor or another member bank— (1) If it is secured by a warehouse, terminal, or other similar receipt covering goods in storage; (2) If the aggregate of obligations of the borrower rediscounted and offered for rediscount at the Federal Reserve Bank is less than a sum equal to 10 per cent of the paid-in capital of the member bank and does not exceed $5,000. V. Drafts, bills of exchange, and trade acceptances. (a) Definition.—A draft or bill of exchange, within the meaning of this regulation, is defined as an unconditional order in writing, addressed by one person to another, other than a banker as defined under B (b), signed by the person giving it, requiring the person to whom it is addressed, to pay, in the United States, at a fixed or determinable future time, a sum certain in dollars to the order of a specified person; and a trade acceptance is defined as a draft or bill of exchange drawn by the seller on the purchaser of goods sold and accepted by such purchaser. (b) Evidence of eligibility.—A Federal Reserve Bank shall take such steps as it deems necessary to satisfy itself as to the eligibility of the draft or bill offered for rediscount, unless it presents prima facie evidence thereof or bears a stamp or certificate affixed by the acceptor or drawer showing that it is a trade acceptance. VI. Six months' agricultural paper. (a) Definition.—Six months' agricultural paper, within the meaning of this regulation, is defined as a note, draft, bill of exchange, or trade acceptance drawn or issued for agricultural purposes, or based on live stock; that is, a Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. 165 note, draft, bill of exchange, or trade acceptance the proceeds of which have been used, or are to be used, for agricultural purposes, including the breeding, raising, fattening, or marketing of live stock, and which has a maturity at the time of discount of not more than six months, exclusive of days of grace. (b) Eligibility.—To be eligible for rediscount six months' agricultural paper, whether a note, draft, bill of exchange, or trade acceptance, must comply with the respective sections of this regulation which would apply to it if its maturity were 90 days or less. VII. Commodity paper. (a) Definition.—Commodity paper within the meaning of this regulation is defined as a note, draft, bill of exchange, or trade acceptance accompanied and secured by shipping documents or by a warehouse, terminal, or other similar receipt covering approved and readily marketable, nonperishable staples properly insured. (b) Eligibility.—To be eligible for rediscount at the special rates authorized to be established for commodity paper, such a note, draft, bill of exchange, or trade acceptance must also comply with the respective sections of this regulation applicable to it, must conform to the requirements of the Federal Reserve Bank relating to shipping documents, receipts, insurance, etc., and must be a note, draft, bill of exchange, or trade acceptance on which the rate of interest or discount, including commission, charged the maker, does not exceed 6 per cent per annum. (c) Suspension of commodity rate.—As the special rate on commodity paper is intended to assist actual producers during crop-moving periods and is not designed to benefit speculators, the board reserves the right to suspend the special rates herein provided whenever it is apparent that the movement of crops, which this rate is intended to facilitate, has been practically completed. B. BANKERS' ACCEPTANCES. {a) General statutory provisions.-—Any Federal Reserve Bank may discount for any of its member banks bankers' acceptances which have a maturity at the time of discount of not more than three months' sight, exclusive of days of grace, which are indorsed by at least one member bank, and which grow out of transactions involving the importation or exportation of goods; or, which grow out of transactions involving the domestic shipment of goods, provided shipping documents are attached at the time of acceptance; or, which are secured at the time of acceptance by a warehouse receipt or other such document conveying or securing title covering readily marketable staples. Any Federal Reserve Bank may also acquire drafts or bills of exchange drawn on member banks by banks or bankers in foreign countries or dependencies or insular possessions of the United States for the purpose of furnish dollar exchange. (&) Definition.—A banker's acceptance within the meaning of this regulation is defined as a draft or bill of exchange of which the acceptor is a bank or trust company, or a firm, person, company, or corporation engaged in the business of granting bankers' acceptance credits. (c) Eligibility.—To be eligible for rediscount the bill must have been drawn under a credit opened for the purpose of conducting, or settling accounts resulting from, a transaction or transactions involving (1) the shipment of goods between the United States and any foreign country, or between the United States and any of its dependencies or insular possessions, or between foreign countries, or (2) the domestic shipment of goods, provided shipping documents are attached at the time of acceptance; or it must be a bill which is secured at Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

166 ANNUAL BEPOBT OF THE FEDERAL RESERVE BOARD. the time of acceptance by a warehouse receipt or other such document conveying or securing title covering readily marketable staples. Any Federal Reserve Bank may also acquire drafts or bills drawn by a bank or banker in a foreign country or dependency or insular possession of the United States for the purpose of furnishing dollar exchange and accepted by a member bank in accordance with the provisions of regulation O, page 8. Such drafts or bills may be acquired prior to acceptance provided they have the indorsement of a member bank. (d) Evidence of eligibility.—A Federal Reserve Bank must be satisfied, either by reference to the acceptance itself or otherwise, that it is eligible for rediscount. Satisfactory evidence of eligibility may consist of a stamp or certificate affixed by the acceptor in form satisfactory to the Federal Reserve Bank. REGULATION B, SERIES OF 1917. (Superseding Regulation B of 1916.) CPEN-MAKKET PUECHASES OF BILLS OF EXCHANGE, TBADE ACCEPTANCES, AND BANK- ERS' ACCEPTANCES TJNDEK SECTION 14. I. General statutory provisions. Section 14 of the Federal Reserve Act permits Federal Reserve Banks under rules and regulations to be prescribed by the Federal Reserve Board to purchase and sell in the open market from banks, firms, corporations, or individuals, bankers' acceptances and bills of exchange of the kinds and maturities made eligible by the act for rediscount, with or without the indorsement of a member bank. II. General character of hills and acceptances eligible. The Federal Reserve Board, exercising its statutory right to regulate the purchase of bills of exchange and acceptances, has determined that a bill of exchange or acceptance, to> be eligible for purchase by Federal Reserve Banks under section 14— (a) Must not have been issued for carrying or trading in stocks, bonds, or other investment securities, except bonds and notes of the Government of the United States. (b) Must not be a bill the proceeds of which have been used or are to be used for permanent or fixed investments of any kind, such as land, buildings, or machinery, or for investments of a merely speculative character. (c) Must have been accepted by the drawee prior to purchase by a Federal Reserve Bank unless it is accompanied and secured by shipping documents or by a warehouse, terminal, or other similar receipt conveying security title. (d) May be secured by the pledge of goods1 or collateral, provided it is otherwise eligible. In addition to the above general requirements, each bill of exchange and trade acceptance purchased under the terms of this regulation must also conform to the more specific requirements set forth under III, and each banker's acceptance must also conform to the more specific requirements set forth under IV. 1 When used in this regulation the word " goods" shall be construed to include goods, wares, merchandise, or agricultural products, including live stock. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. 167 III. Bills of exchange and trade acceptances. (a) Definition.—A bill of exchange, within the meaning of this regulation, is defined as an unconditional order in writing, addressed by one person to another, other than a banker as defined under IV (a), signed by the person giving it, requiring the person to whom it is addressed, to pay, in the United States, at a fixed or determinable future time, a sum certain in dollars to the order of a specified person; and a trade acceptance is defined as a bill of exchange drawn by the seller on the purchaser of goods sold, and accepted by such purchaser. (b) Eligibility.—To be eligible for purchase the bill must have arisen out of an actual commercial transaction, domestic or foreign; that is, it must be a bill which has been issued or drawn for agricultural, industrial, or commercial purposes or the proceeds of which have been used or are to be used for the purpose of producing, purchasing, carrying, or marketing goods in one or more of the steps of the process of production, manufacture, or distribution. It must have a maturity at time of purchase of not more than 90 days, exclusive of days of grace. (c) Evidence of eligibility.—A Federal Reserve Bank shall take such steps as it deems necessary to satisfy itself as to the eligibility of the bill offered for purchase, unless it presents prima facie evidence thereof or bears a stamp or certificate affixed by the acceptor or drawer showing that it is a trade acceptance. • . (d) Statements.—Unless indorsed by a member bank, a bill is not eligible for purchase until a satisfactory statement has been furnished of the financial condition of one or more of the parties thereto. IV. Bankers1 Acceptances. (a) Definition.—A banker's acceptance, within the meaning of this regulation, is a bill of exchange of which the acceptor is a bank or trust company, or a firm, person, company, or corporation engaged in the business of granting bankers' acceptance credits. (b) Eligibility.—To be eligible for purchase, the bill which must have a maturity at time of purchase of not more than three months, exclusive of days of grace, must have been drawn under a credit opened for the purpose of conducting, or settling accounts resulting from, a transaction or transactions involving— (1) The shipment of goods between the United States and any foreign country, or between the United States and any of its dependencies or insular possessions, or between foreign countries, or (2) The shipment of goods within the United States, provided the bill at the time of its acceptance is accompanied by shipping documents, or (3) The storage within the United States of readily marketable goods, provided the acceptor of the bill is secured by warehouse, terminal, or other similar receipt, or (4) The storage within the United States of goods which have been actually sold, provided the acceptor of the bill is secured by the pledge or such goods; or it must be a bill drawn by a bank or banker in a foreign country or dependency or insular possession of the United States for the purpose of furnishing dollar exchange. In this latter case the bank or banker drawing the bill must be in a country, dependency, or possession whose usages of trade have been determined by the Federal Reserve Board to require the drawing of bills of Digitized fort hFiRs AcShEaRra cter. http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

168 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. (c) Evidence of eligibility.—A Federal Reserve Bank must be satisfied either by reference to the acceptance itself, or otherwise, that it is eligible for purchase. Satisfactory evidence of eligibility may consist of stamp or certificate" affixed by the acceptor, in form satisfactory to the Federal Reserve Bank. No evidence of eligibility is required with respect to a bill accepted by a national bank. (d) Statements.—Bankers' acceptances, other than those accepted or indorsed by member banks, shall be eligible for purchase only after the acceptor has furnished a satisfactory statement of financial condition in form to be approved by the Federal Reserve Board and has agreed in writing with a Federal Reserve Bank to inform it upon request concerning the transactions underlying such acceptances. REGULATION C, SERIES OF 1917. (Superseding Regulation C of 1916.) ACCEPTANCE BY MEMBER BANKS OF DEAFTS AND BILLS OF EXCHANGE. ACCEPTANCE OF DRAFTS OR BILLS OF EXCHANGE DRAWN AGAINST DOMESTIC OS FOREIGN SHIPMENTS OF GOODS OR SECURED BY WAREHOUSE RECEIPTS COVERING READILY MARKETABLE STAPLES. I. Statutory Provisions. - Under the provisions of the fifth paragraph of section 13 of the Federal Reserve Act, as amended by the acts of September 7, 1916, and June 21, 1917, any member bank may accept drafts or bills of exchange drawn upon it, having not more than six months' sight to run, exclusive of days of grace, which grow out of transactions involving the importation or exportation of goods; or which grow out of transactions involving the domestic shipment of goods, provided shipping documents conveying or securing title are attached at the time of acceptance; or which are secured at the time of acceptance by a warehouse receipt or other such document conveying or securing title covering readily marketable staples. This paragraph limits the amount which any bank shall accept for any one person, company, firm, or corporation, whether in a foreign or domestic transaction, to an amount not exceeding at any time, in the aggregate, more than 10 per cent of its paid-up and unimpaired capital stock and surplus. This limit, however, does not apply in any ease where the accepting bank is secured either by attached documents or by some other actual security growing out of the same transaction as the acceptance. The law also provides that any bank may accept such bills up to an amount not exceeding at any time, in the aggregate, more than one-half of its paid-up and unimpaired capital stock and surplus; or, with the approval of the Federal Reserve Board, up to an amount not exceeding at any time, in the aggregate, more than 100 per cent of its paid-up and unimpaired capital stock and surplus. In no event, however, shall the aggregate amount of acceptances growing out of domestic transactions exceed 50 per cent of such capital stock and surplus. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. 169 II. Regulations. 1. Under the provisions of the law referred to above the Federal Reserve Board has determined that any member bank, having an unimpaired surplus equal to at least 20 per cent of its paid-up capital, which desires to accept drafts or bills of exchange drawn for the purposes described above, up to an amount not exceeding at any time, in the aggregate, 100 per cent of its paid-up and unimpaired capital stock and surplus, may file an application for that purpose with the Federal Reserve Board. Such application must be forwarded through the Federal Reserve Bank of the district in which the applying bank is located. 2. The Federal Reserve Bank shall report to the Federal Reserve Board upon the standing of the applying bank, stating whether the business and banking conditions prevailing in its district warrant the granting of such applications. 3. The approval of any such application may be rescinded upon 90 days' notice to the bank affected. B. ACCEPTANCE OF DRAFTS OR BILLS OF EXCHANGE DRAWN FOR THE PURPOSE OF CREATING DOLLAR EXCHANGE. 1. Statutory provisions. Section 13 of the Federal Reserve Act also provides that any member bank may accept drafts or bills of exchange drawn upon it having not more than three months' sight to run, exclusive of days of grace, drawn, under regulations to be prescribed by the Federal Reserve Board, by banks or bankers in foreign countries or dependencies or insular possessions of the United States for the purpose of furnishing dollar exchange as required by the usages of trade in the respective countries, dependencies, or insular possessions. No member bank shall accept such drafts or bills of exchange for any one bank to an amount exceeding in the aggregate 10 per cent of the paid-up and .unimpaired capital and surplus of the accepting bank unless the draft or bill of exchange is accompanied by documents conveying or securing title or by some other adequate security. No member bank shall accept such drafts or bills in an amount exceeding at any time in the aggregate one-half of its paid-up and unimpaired capital and surplus. This 50 per cent limit is separate and distinct from and not included in the limits placed upon the acceptance of drafts and bills of exchange as described under section A of the regulation. II. Regulations. Any member bank desiring to accept drafts drawn by banks or bankers in foreign countries or dependencies or insular possessions of the United States for the purpose of furnishing dollar exchange shall first make an application to the Federal Reserve Board setting forth the usages of trade in the respective countries,'dependencies, or insular possessions in which such banks or bankers are located. If the Federal Reserve Board should determine that the usages of trade in such countries, dependencies, or possessions require the granting of the acceptance facilities applied for, it will notify the applying bank of its approval and will also publish in the Federal Reserve Bulletin the name or names of those countries, dependencies, or possessions in which banks or bankers are author- Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

170 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. ized to draw on member banks whose applications have been approved for the purpose of furnishing dollar exchange. The Federal Reserve Board reserves the right to modify or on 90 days' notice to revoke its approval either as to any particular member bank or as to any foreign country or dependency or insular possession of the United States in which it has authorized banks or bankers to draw on member banks for the purpose of furnishing dollar exchange. REGULATION D, SERIES OF 1917- [Superseding Regulation D of 1916.] TIME DEPOSITS AND SAVINGS ACCOUNTS. Section 19 of the Federal Reserve Act provides, in part, as follows: Demand deposits, within the meaning of this act, shall comprise all deposits payable within 30 days, and time deposits shall comprise all deposits payable after 30 days, and all savings accounts and certificates of deposit which are subject to not less than 30 days' notice before payment, and all postal savings deposits. Time deposits, open accounts. The term " time deposits, open accounts," shall be held to include all accounts not evidenced by certificates of deposit or savings pass books, in respect to which a written contract is entered into with the. depositor at the time the deposit is made that neither the whole nor any part of such deposit may be withdrawn by check or otherwise except on a given date or on written notice given by the depositor a certain specified number of days in advance, in no case less than 30 days. Savings accounts. The term " savings accounts " shall be held to include those accounts of the bank in respect to which, by its printed regulations, accepted by the depositor at the time the account is opened— (a) The pass book, certificate, or other similar form of receipt must be presented to the bank whenever a deposit or withdrawal is made; and (o) The depositor may at any time be required by the bank to give notice of an intended withdrawal not less than 30 days before a withdrawal is made. Time certificates of deposit. A " time certificate of deposit" is defined as an instrument evidencing the deposit with a bank, either with or without interest, of a certain sum specified on the face of the certificate payable in whole or in part to the depositor or on his order— (a) On a certain date, specified on the certificate, not less than 30 days after the date of the deposit; or (&) After the lapse of a certain specified time subsequent to the date of the certificate, in no case less than 30 days; or (c) Upon written notice given a certain specified number of days, not less than 30 days before the date of repayment; and {d) In all cases only upon presentation of the certificate at each withdrawal for proper indorsement or surrender. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. 171 REGULATION E, SERIES OF 1917. (Superseding Regulation E of 1916.) PURCHASE OF WARRANTS. Statutory Requirements. Section 14 of the Federal Reserve Act reads in part as follows: Every Federal Reserve Bank shall have power— (&) To buy and sell, at home or abroad, bonds and notes of the United States, and bills, notes, revenue bonds, and warrants with a maturity from date of purchase of not exceeding six months, issued in anticipation of the collection of taxes or in anticipation of the receipt of assured revenues by any State, county, district, political subdivision, or municipality in the continental United States, including irrigation, drainage, and reclamation districts, such purchases to be made in accordance with rules and regulations prescribed by the Federal Reserve Board. For brevity's sake, the term " warrant" when used in this regulation shall be construed to mean " bills, notes, revenue bonds, and warrants with a maturity from date of purchase of not exceeding six months," and the term " municipality " shall be construed to mean " State, county, district, political subdivision, or municipality in the continental United States, including irrigation, drainage, and reclamation districts." Regulation. I. Any Federal Reserve Bank may purchase warrants issued by a municipality in anticipation of the collection of taxes or in anticipation of the receipt of assured revenues, provided— (a) They are the general obligations of the entire municipality; it being intended to exclude as ineligible for purchase all such obligations as are payable from " local benefit" and " special assessment" taxes when the municipality at large is not directly or ultimately liable; (b) They are issued in anticipation of taxes or revenues which are due and payable on or before the date of maturity of such warrants; but the Federal Reserve Board may waive this condition in specific cases. For the purposes of this regulation, taxes shall be considered as due and payable on the last day on which they may be paid without penalty; (c) They are issued by a municipality— (1) Which has been in existence a for a period of 10 years; (2) Which for a period of 10 years previous to the purchase has not defaulted * for longer than 15 days in the payment of any part of either principal or interest of any funded debt authorized to be contracted by it; (3) Whose net funded indebtedness a does not exceed 10 per cent of the valuation of its taxable property, to be ascertained by the last preceding valuation of property for the assessment of taxes. II. Except with the approval of the Federal Reserve Board, no Federal Reserve Bank shall purchase and hold an amount in excess of 25 per cent of the total amount of warrants outstanding at any time and issued in conformity with provisions of section 14 (b) above quoted, and actually sold by a municipality. III. Except with the approval of the Federal Reserve Board, the aggregate amount invested by any Federal Reserve Bank in warrants of all kinds shall 3 See Appendix, p. 172. Digitized for FRAS3E4R3 65°—18 12 http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

172 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. not exceed at the time of purchase a sum equal to 10 per cent of the deposits kept by its member banks with such Federal Reserve Bank. IV. Except with the approval of the Federal Reserve Board, the maximum amount which may be invested at the time of purchase by any Federal Reserve Bank in warrants of any single municipality shall be limited to the following percentages of the deposits kept in such Federal Reserve Bank by its member banks: Five per cent of such deposits in warrants of a municipality of 50,000 population or over; Three per cent of such deposits in warrants of a municipality of over 30,000 population, but less than 50,000; One per cent of such deposits in warrants of a municipality of over 10,000 population, but less than 30,000. V. Warrants of a municipality of 10,000 population or less shall be purchased only with the special approval of the Board. The population of a municipality shall be determined by the last Federal or State census. Where it can not be exactly determined the Board will make special rulings. VI. Opinion of recognized counsel on municipal issues or of the regularly appointed counsel of the municipality, as to the legality of the issue shall be secured and approved in each case by counsel for the Federal Reserve Bank. VII. Any Federal Reserve Bank may purchase from any of its member banks warrants of any municipality indorsed by such member bank, with waiver of demand, notice, and protest, up to an amount not to exceed 10 per cent of the aggregate capital and surplus of such member bank: Provided, however, That such warrants comply with provisions I and III of these regulations, except that where a period of 10 years is mentioned in I (c) hereof a period of 5 years shall be substituted for the purposes of this clause. APPENDIX TO REGULATION E. " NET FUNDED INDEBTEDNESS. " The term " net funded indebtedness " is hereby defined to mean the legal gross indebtedness of the municipality (including the amount of any school district or other bo ads which depend for their redemption upon taxes levied upon property within the municipality) less the aggregate of the following items: (1) The amount of outstanding bonds or other debt obligations made payable from current revenues; (2) The amount of outstanding bonds issued for the purpose of providing the inhabitants of a municipality with public utilities, such as waterworks, docks, electric plants, transportation facilities, etc.: Provided, That evidence is submitted showing that the income from such utilities is sufficient for maintenance, for payment of interest on such bonds, and for the accumulation of a sinking fund for their redemption; (3) The amount of outstanding improvement bonds, issued under laws which provide for the levying of special assessments against abutting property in amounts sufficient to insure the payment of interest on the bonds and the redemption thereof: Provided, That such bonds are direct obligations of the municipality and included in the gross indebtedness of the municipality; (4) The total of all sinking funds accumulated for the redemption of the gross indebtedness of the municipality, except sinking funds applicable to bonds just described in (1), (2), and (3) above. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. 173 " EXISTENCE " AND " NONDEFAULT." Warrants will be construed to comply with that part df I (c) of Regulation E relative to term of existence and nondefault, under the following conditions: (1) Warrants issued by or in behalf of any municipality which was, subsequent to the issuance of such warrants, consolidated with or merged into an existing political division which meets the requirements of these regulations, will be deemed to be the warrants of such political division: Provided, That such warrants were assumed by such political division under statutes and appropriate proceedings the effect of which is to make such warrants general obligations of such assuming political division and payable, either directly or ultimately, without limitation to a special fund from the proceeds of taxes levied upon all the taxable real and personal property within its territorial limits. (2) Warrants issued by or in behalf of any municipality which was, subsequent to the issuance of such warrants, wholly succeeded, by a newly organized political division whose term of existence, added to that of such original political division or of any other political division so succeeded, is equal to a period of 10 years will be deemed to be warrants of such succeeding political division: Provided, That during such period none of such political divisions shall have defaulted for a period exceeding 15 days in the payment of any part of either principal or interest of any funded debt authorized to be contracted by it: And provided further, That such warrants were assumed by such new political division under statutes and appropriate proceedings the effect of which is to make such warrants general obligations of such assuming political division and payable, either directly or ultimately, without limitation to a special fund from the proceeds of taxes levied upon all the taxable real and personal property within its territorial limits. (3) Warrants issued by or in behalf of any municipality which, prior to such issuance, became the successor of one or more, or was formed by the consolidation or merger of two or more, preexisting political divisions, the term of existence of one or more of which, added to that of such succeeding or consolidated political division, is equal to a period of 10 years, will be deemed to be warrants of a political division which has been in existence for a period of 10 years: Provided, That during such period none of such original, succeeding, or consolidated political divisions shall have defaulted for a period exceeding 15 days in the payment of any part of either principal or interest of any funded debt authorized to be contracted by it. REGULATION F, SERIES OF 1917. (Superseding Regulation F of 1916.) TRUST POWERS OF NATIONAL BANKS. I. Statutory provisions. The Federal Reserve Act provides: SEC. 11. The Federal Reserve Board shall be authorized and empowered: (k) To grant by special permit to national banks applying therefor, when not in contravention of State or local law, the right to act as trustee, executor, adminisrator, or registrar of stocks and bonds, under such rules and regulations as the said Board may prescribe. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

174 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. II. Applications. A national bank desiring to exercise any or all of the privileges authorized by section 11, subsection (k), of the Federal Reserve Act, shall make application to the Federal Reserve Board on a form approved by said Board (Form No. 61). Such application shall be forwarded by the applying bank to the Chairman of the Board of Directors of the Federal Reserve Bank of its district, and shall thereupon be transmitted to the Federal Reserve Board with his recommendations. III. Separate departments. Every national bank permitted to act under this section shall establish a separate trust department, and shall place such department under the management of an officer or officers, whose duties shall be prescribed by the board of directors of the bank. IV. Provision for keeping trust funds. The funds, securities, and investments held in each trust shall be held separate and distinct from the general funds and securities of the bank, and separate and distinct one from another. The ledgers and other books kept for the trust department shall be entirely separate and apart from the other books and records of the bank. V. Examinations. Examiners appointed by the Comptroller of the Currency or designated by the Federal Reserve Board will hereafter be instructed to make thorough and complete audits of the cash, securities, accounts, and investments of the trust department of every bank at the same time that examination is made of the banking department. VI. Conformity with State laws. Nothing in these regulations shall be construed to give to a national bank doing business as trustee, executor, administrator, or registrar of stocks and bonds under section 11 (k) of the Federal Reserve Act any rights or privileges in contravention of the laws of the State in which the bank is located. VII. Revocation of permits. The Federal Reserve Board reserves the right to revoke permits granted under these regulations in any case where in the opinion of the Board a bank has willfully violatd the provisions of these regulations or the laws of any State relating to the operations of such bank when acting as trustee, executor, administrator, or registrar of stocks and bonds. VIII. Changes in rules. These regulations are subject to change by the Federal Reserve Board; provided, however, that no such change shall prejudice obligations undertaken in good faith under regulations in effect at the time the obligation was assumed. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. 175 REGULATION G, SERIES OF 1917. (Superseding Regulation G of 1916.) LOANS ON FARM LAND AND OTHER REAL ESTATE. Section 24 of the Federal Reserve Act provides in part that— Any national banking association not situated in a central reserve city may make loans secured by improved and unencumbered farm land situated within its Federal Reserve district or within a radius of one hundred miles of the place in which such bank is located, irrespective of district lines, and may also make loans secured by improved and unencumbered real estate located within one hundred miles of the place in which such bank is located, irrespective of district lines; but no loan made upon the security of such farm land shall be made for a longer time than five years, and no loan made upon the security of such real estate as distinguished from farm land shall be made for a longer time than one year nor shall the amount of any such loan, whether upon such farm land or upon such real estate, exceed fifty per centum of the actual value of the property offered as security. Any such bank may make such loans, whether secured by such farm land or such real estate, in an aggregate sum equal to twenty-five per centum of its capital and surplus or to one-third of its time deposits and such banks may continue hereafter as heretofore to receive time deposits and to pay interest on the same. National banks not located in central reserve cities may, therefore, legally make loans secured by improved and unencumbered farm land or other real estate as provided by this section. Certain conditions and restrictions must, however, be observed— (a) There must be no prior lien on the land; that is, the lending bank must hold an absolute first mortgage or deed of trust. (b) The amount of the loan must not exceed 50 per cent of the actual value of the land by which it is secured. (c) The maximum amount of loans which a national bank may make on real estate, whether on farm land or on other real estate as distinguished from farm land, is limited under the terms of the act to an amount not in excess of one-third of its time deposits at the time of the making of the loan, and not in excess of one-third of its average time deposits during the preceding calendar year: Provided, however, That if one-third of such time deposits as of the date of making the loan, or one-third of the average time deposits for the preceding calendar year, is less than one-fourth of the capital and surplus of the bank as of the date of making the loan, the bank in such event shall have authority to make loans upon real estate under the terms of the act to the extent of one-fourth of the bank's capital and surplus as of that date. (d) Farm land to be eligible as security for a loan by a national bank must be situated within the Federal Reserve district in which such bank is located or within a radius of 100 miles of such bank irrespective of district lines. ** (e) Real estate as distinguished from farm land to be eligible as security for a loan by a national bank must be located within a radius of 100 miles of such bank irrespective of district lines. (/) The right of a national bank to " make loans " under section 24 includes the right to purchase or discount loans already made as well as the right to make such loans in the first instance: Provided, however, That no loan secured by farm land shall have a maturity of more than five years from the date on which it was purchased or made by the national bank and that no loan secured by other real estate shall have a maturity of more than one year from such date. (g) Though no national bank is authorized under the provisions of section 24 to make a loan on the security of real estate, other than farm land, for a Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

176 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. period exceeding one year, nevertheless, at the end of the year, it may properly make a new loan upon the same security for a period not exceeding one year. The maturing note must be canceled and a new note taken in its place, but in order to obviate the necessity of making a new mortgage or deed of trust for each renewal, the original mortgage or deed of trust may be so drawn in the first instance as to cover possible future renewals of the original note. Under no circumstances, however, must the bank obligate itself in advance to make such a renewal. It must, in all cases, preserve the right to require payment at the end of the year and to foreclose the mortgage should that action become necessary. The same principles apply to loans of longer maturities secured by farm lands. (7i) In order that real estate loans held by a bank may be readily classified, a statement signed by the officers making a loan and having knowledge of the facts upon which it is based must be attached to each note secured by a first mortgage on the land by which the loan is secured, certifying in detail as of the date of the loan that all of the requirements of law have been duly observed. KEGULATION H, SERIES OF 1917. (Superseding Regulation H of 1916.) MEMBERSHIP OF STATE BANKS AND TRUST COMPANIES. I. Statutory requirements. Section 9 of the Federal Reserve Act, as amended by the act approved June 21, 1917, which authorizes State banks and trust companies to become members of the Federal Reserve system, is quoted in the appendix to this regulation on page 24. II. Banks eligible for membership. A State bank or a trust company to be eligible for membership in a Federal Reserve Bank must comply with the following conditions: 1. It must have been incorporated under a special or general law of the State or district in which it is located. 2. It must have a minimum paid-up unimpaired capital stock as follows: In cities or towns not exceeding 3,000 inhabitants, $25,000. In cities or towns exceeding 3,000 but not exceeding 6,000 inhabitants, $50,000. In cities or towns exceeding 6,000 but not exceeding 50,000 inhabitants, $100,000. In cities exceeding 50,000 .inhabitants, $200,000. III. Application for membership. Any eligible State bank or trust company may make application on F. R. B. Form 83a, made a part of this regulation, to the Federal Reserve Board for an amount of capital stock in the Federal Reserve Bank of its district equal to 6 per cent of the paid-up capital stock and surplus of such State bank or trust company. This application must be forwarded direct to the Federal Reserve agent of the district in which the applying bank or trust company is located and must be accompanied by Exhibits I, II, and III, referred to on page 1 of the application blank. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. 177 IV. Approval of application. In passing upon an application the Federal Reserve Board will consider especially— 1. The financial condition of the applying bank or trust company and the general character of its management. 2. Whether the corporate powers exercised by the applying bank or trust company are consistent with the purposes of the Federal Reserve Act. 3. Whether the laws of the State or district in which the applying bank or trust company is located contain provisions likely to present proper compliance with the provisions of the Federal Reserve Act and the regulations of the Federal Reserve Board made in conformity therewith. If, in the judgment of the Federal Reserve Board, an applying bank or trust company conforms to all the requirements of the Federal Reserve Act and these regulations, and is otherwise qualified for membership, the board will issue a certificate of approval, subject to such conditions as it may deem necessary to insure compliance with the act and these regulations. When the conditions imposed by the board have been accepted by the applying bank or trust company the board will issue a certificate of approval, whereupon the applying bank or trust company shall make a payment to the Federal Reserve Bank of its district of one-half of the amount of its subscription, i. e., 3 per cent of the amount of its paid-up capital and surplus, and upon receipt of this payment the appropriate certificate of stock will be issued by the Federal Reserve Bank. The remaining half of the subscription of the applying bank or trust company shall be subject to call when deemed necessary by the Federal Reserve Board. V. Powers and restrictions. Every State bank or trust company, while a member of the Federal reserve system— 1. Shall retain its full charter and statutory rights as a State bank or trust company, subject to the provisions of the Federal Reserve Act and to the regulations of the Federal Reserve Board, including any conditions embodied in the certificate of approval; 2. Shall maintain such improvements and changes in its banking practice as may have been specifically required of it by the Federal Reserve Board as a condition of its admission and shall not lower the standard of banking then required of it; and 3. Shall enjoy all the privileges and observe all those requirements of the Federal Reserve Act and of the regulations of the Federal Reserve Board made in conformity therewith which are applicable to State banks and trust companies which have become member banks. VI. Examinations and reports. Every State bank or trust company, while a member of the Federal Reserve System, shall be subject to examinations made by direction of the Federal Reserve Board or of the Federal Reserve Bank by examiners selected or approved by the Federal Reserve Board. In order to avoid duplication, examinations of State banks and trust companies made by State authorities will be accepted in lieu of examinations by examiners selected or approved by the board wherever these are satisfactory to the directors of the Federal Reserve Bank and where, in addition, satisfactory arrangements for cooperation in the matter of examination between Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

178 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. the designated examiners of the board and those of the States already exist or can be effected with State authorities. Examiners from the staff of the board or of the Federal Reserve Banks will, whenever desirable, be designated by the board to act with the examination staff of the State, in order that uniformity in the standard of examination may be assured. Every State bank or trust company, while a member of the Federal Reserve System, shall be required to make in each year not less than three reports of condition and of the payment of dividends. Such reports shall be made to the Federal Reserve Bank of its district on call of such bank on dates to be fixed by the Federal Reserve Board. APPENDIX TO REGULATION H. Section 9 of the Federal Reserve Act as amended by the act approved June 21, 1917, provides that: Any bank incorporated by special law of any State, or organized under the general laws of any State, or of the United States, desiring to become a member of the Federal Reserve System, may make application to the Federal Reserve Board, under such rules and regulations as it may prescribe, for the right to subscribe to the stock of the Federal Reserve Bank organized within the district in which the applying bank is located. Such application shall be for the same amount of stock that the applying bank would be required to subscribe to as a national bank. The Federal Reserve Board, subject to such conditions as it may prescribe, may permit the applying bank to become a stockholder of such Federal Reserve Bank. In acting upon such applications, the Federal Reserve Board shall consider the financial condition of the applying bank, the general character of its management, and whether or not the corporate powers exercised are consistent with the purposes of this act. Whenever the Federal Reserve Board shall permit the applying bank to become a stockholder in the Federal Reserve Bank of the district its stock subscription shall be payable on call of the Federal Reserve Board and stock issued to it shall be held subject to the provisions of this act. All banks admitted to membership under authority of this section shall be required to comply with the reserve and capital requirements of this act and to conform to those provisions of law imposed on national banks which prohibit such banks from lending on or purchasing their own stock, which relate to the withdrawal or impairment of their capital stock, and which relate to the payment of unearned dividends. Such banks and the officers, agents, and employees thereof shall also be subject to the provisions of and to the penalties prescribed by section fifty-two hundred and nine of the Revised Statutes, and shall be required to make reports of condition and of the payment of dividends to the Federal Reserve Bank of which they become a member. Not less than three of such reports shall be made annually on call of the Federal Reserve Bank on dates to be fixed by the Federal Reserve Board. Failure to make such reports within ten days after the date they are called for shall subject the offending bank to a penalty of $100 a day for each day that it fails to transmit such report; such penalty to be collected by the Federal Reserve Bank by suit or otherwise. As a condition of membership such banks shall likewise be subject to examinations made by direction of the Federal Reserve Board or of the Federal reserve bank by examiners selected or approved by the Federal Reserve Board. Whenever the directors of the Federal reserve bank shall approve the examinations made by the State authorities, such examinations and the reports thereof may be accepted in lieu of examinations made by examiners selected or approved by the F'ederal Reserve Board: Provided, however, That when it deems it necessary the board may order special examinations by examiners of its own selection and shall in all cases approve the form of report. The expenses of all examinations, other than those made by State authorities, shall be assessed against and paid by the bank examined. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

ANNUAL BEPORT OF THE FEDERAL RESERVE BOARD. 179 If at any time it shall appear to the Federal Reserve Board that a member bank has failed to comply with the provisions of this section or the regulations of the Federal Reserve Board made pursuant thereto, it shall be within the power of the board after hearing to require such bank to surrender its stock in the Federal reserve bank and to forfeit all rights and privileges of membership. The Federal Reserve Board may restore membership upon due proof of compliance with the conditions imposed by this section. Any State bank or trust company desiring to withdraw from membership in a Federal reserve bank may do so, after six months' written notice shall have been filed with the Federal Reserve Board, upon the surrender and cancellation of all of its holdings of capital stock in the Federal reserve bank: Provided, however, That no Federal reserve bank shall, except under express authority of the Federal Reserve Board, cancel within the same calendar year more than twenty-five per centum of its capital stock for the purpose of effecting voluntary withdrawals during that year. All such applications shall be dealt with in the order in which they are filed with the board. Whenever a member bank shall surrender its stock holdings in a Federal reserve bank, or shall be ordered to do so by the Federal Reserve Board, under authority of law, all of its rights and privileges as a member bank shall thereupon cease and determine, and after due provision has been made for any indebtedness due or to become due to the Federal reserve bank it shall be entitled to a refund of its cash paid subscription with interest at the rate of one-half of one per centum per month from date of last dividend, if earned, the amount refunded in no event to exceed the book value of the stock at that time, and shall likewise be entitled to repayment of deposits and of any other balance due from the Federal reserve bank. No applying bank shall be admitted to membership in a Federal Reserve Bank unless it possesses a paid-up unimpaired capital sufficient to entitle it to become a national banking association in the place where it is situated under the provisions of the national bank act. Banks becoming members of the Federal Reserve System under authority of this section shall be subject to the provisions of this section and to those of this act which relate specifically to member banks, but shall not be subject to examination under the provisions of the first two paragraphs of section fifty-two hundred and forty of the Revised Statutes as amended by section twenty-one of this act. Subject to the provisions of this act and to the regulations of the board made pursuant thereto, any bank becoming a member of the Federal Reserve System shall retain its full charter and statutory rights as a State bank or trust company, and may continue to exercise all corporate powers granted it by the State in which it was created, and shall be entitled to all privileges of member banks: Provided, hoivever, That no Federal Reserve Bank shall be permitted to discount for any State bank or trust company notes, drafts, or bills of exchange of any one borrower who is liable for borrowed money to such State bank or trust company in an amount greater than ten per centum of the capital and surplus of such State bank or trust company, but the discount of bills of exchange drawn against actually existing value and the discount of commercial or business paper actually owned by the person negotiating the same shall not be considered as borrowed money within the meaning of this section. The Federal Reserve Bank, as a condition of the discount of notes, drafts, and bills of exchange for such State bank or trust company, shall require a certificate or guaranty to the effect that the borrower is not liable to such bank in excess of the amount provided by this section, and will not be permitted to become liable in excess of this amount while such notes, drafts, or bills of exchange are under discount with the Federal Reserve Bank. It shall be unlawful for any officer, clerk, or agent of any bank admitted to membership under authority of this section to certify any check drawn upon such bank unless the person or company drawing the check has on deposit therewith at the time such check is certified an amount of money equal to the amount specified in such check. Any check so certified by duly authorized officers shall be a good and valid obligation against such bank, but the act of any such officer, clerk, or agent in violation of this section may subject such bank to a forfeiture of its membership in the Federal Reserve System upon hearing by the Federal Reserve Board. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

180 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. REGULATION I, SERIES OF 1917. (Superseding Regulation I of 1916.) INCREASE OR DECREASE OF CAPITAL STOCK OF FEDERAL RESERVE BANKS. Increase of Capital Stock. Whenever the capital stock of any Federal Reserve Bank shall be increased by new banks becoming members, or by the increase of capital or surplus of any member bank and the allotment of additional capital stock to such bank, the board of directors of such Federal Reserve Bank shall certify such increase to the Comptroller of the Currency on Form 58, which is made a part of this regulation. Decrease of capital stock. I. Whenever a member bank reduces its capital stock or surplus, and, in the case of reduction of its capital, such reduction has been approved by the Comptroller of the Currency and by the Federal Reserve Board in accordance with the provisions of section 28 of the Federal Reserve Act, it shall file with the Federal Reserve Bank of which it is a member an application on Form 60, which is made a part of this regulation. When this application has been approved, the Federal Reserve Board shall take up and cancel the receipt issued to such bank for cash payments made on its subscription and shall issue in lieu thereof a new receipt after refunding to the member bank the proportionate amount due such bank on account of the subscription canceled. The receipt so issued shall show the date of original issue, so that dividends may be calculated thereon. II. Whenever a member bank shall be declared insolvent and a receiver appointed by the proper authorities, such receiver shall file with the Federal Reserve Bank of which the insolvent bank is a member an application on Form 87, which is made a part of this regulation, for the surrender and cancellation of the stock held by and for the refund of all balances due to such insolvent member bank. Upon approval of this application by the Federal Reserve agent the Federal Reserve .Bank shall accept and cancel the stock surrendered, and shall adjust accounts between the member bank and the Federal Reserve Bank by applying to the indebtedness of the insolvent member bank to such Federal Reserve Bank all cash-paid subscriptions made by it on the stock canceled with one-half of 1 per cent per month from the period of last dividend, if earned, not to exceed the book value thereof, and the balance, if any, shall be paid to the duly authorized receiver of such insolvent member bank. III. Whenever a member bank goes into voluntary liquidation and a liquidating agent is appointed, such agent shall file with the Federal Reserve Bank of which it is a member an application on Form 86, which is made a part of this regulation, for the surrender and cancellation of the stock held by and for the refund of all balances due to such liquidating member bank. Upon approval of this application by the Federal Reserve agent the Federal Reserve Bank shall accept and cancel the stock surrendered, and shall adjust accounts between the liquidating member bank and the Federal Reserve Bank by applying to the indebtedness of the liquidating member bank to such Federal Reserve Bank all cash-paid subscriptions made by it on the stock canceled with one-half of 1 per cent per month from the period of last dividend, if earned, not to exceed the book value thereof, and the balance, if any, shall be paid to the duly authorized liquidating agent of such liquidating member bank. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. 181 IV. Whenever the stock of a Federal Reserve Bank shall be reduced in the manner provided in Paragraphs I, II, or III of this regulation the board of directors of such Federal Reserve Bank shall, in accordance with the provisions of section 6, file with the Comptroller of the Currency a certificate of such reduction on Form 59, which is made a part of this regulation. REGULATION J, SERIES OF 1917. (Superseding Regulation J of 1916.) CHECK CLEARING AND COLLECTION Section 16 of the Federal Reserve Act authorizes the Federal Reserve Board to require each Federal Reserve Bank to exercise the function of a clearing house for its member banks, and section 13 of the Federal Reserve Act, as amended by the act approved June 21, 1917, authorizes each Federal Reserve Bank to receive from any nonmember bank or trust company, solely for the purposes of exchange or of collection, deposits of current funds in lawful money, national-bank notes, Federal Reserve notes, checks, and drafts payable upon f presentation, or maturing notes and bills, provided such nonmember bank or trust company maintains with its Federal Reserve Bank a balance sufficient to offset the items in transit held for its account by the Federal Reserve Bank. In pursuance of the authority vested in it under these provisions of law, the Federal Reserve Board, desiring to afford both to the public and to the various banks of the country a direct, expeditious, and economical system of check collection and settlement of balances, has arranged to have each Federal Reserve Bank exercise the functions of a clearing house for such of its member banks as desire to avail themselves of its privileges and for such State banks and trust companies as may maintain with the Federal Reserve Bank a balance sufficient to qualify it as a clearing member under the provisions of section 13. Each Federal Reserve Bank shall exercise the functions of a clearing house under the following general terms and conditions: (1) Each Federal Reserve Bank will receive at par from its member banks and from nonmember banks in its district which have become clearing members, checksx drawn on all member and clearing member banks and on all other nonmember banks which agree to remit at par through the Federal Reserve Bank of their district. (2) Each Federal Reserve Bank will receive at par from other Federal Reserve Banks and will receive at par from all member and clearing member banks, regardless of their location, for the credit of their accounts with their respective Federal Reserve Banks, checks drawn upon all member and clearing member banks of its district and upon all other nonmember banks of its district whose checks can be collected at par by the Federal Reserve Bank. The Federal Reserve Banks will prepare a par list of all nonmember banks, to be revised from time to time, which will be furnished to member and clearing member banks. (3) Immediate credit entry upon receipt subject to final payment will be made for all such items upon the books of the Federal Reserve Bank at full 1 A check is generally defined as a draft or order upon a bank, or order upon a bank or banking house, purporting to be drawn upon a deposit of funds, for the payment at all events of a certain sum of money to a certain person therein named, or to him or his order, or to bearer, and payable instantly on demand. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

182 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. face value, but the proceeds will not be counted as part of the minimum reserve nor become available to meet checks drawn until actually collected, in accordance with the best practice now prevailing. (4) Checks received by a Federal Reserve Bank on its member or clearingmember banks will be forwarded direct to such banks and will not be charged to their accounts until sufficient time has elapsed within which to receive advice of payment. (5) In the selection of collecting agents for handling checks on nonmember banks, which have not become clearing members, member banks will be given the preference. (6) Under this plan each Federal Reserve Bank will receive at par from its member and clearing-member banks checks on all member and clearing-member banks and on all other nonmember banks whose checks can be collected at par by any Federal Reserve Bank. Member and clearing-member banks will be required by the Federal Reserve Board to provide funds to cover at par all checks received from or for the account of their Federal reserve banks: Provided, hoivever, That a member or clearing-member bank may ship currency or specie from its own vaults at the expense of its Federal Reserve Bank to cover any deficiency which may arise because of and only in the case of inability to provide items to offset checks received from or for the account of its Federal Reserve Bank.1 (7) Section 19 of the Federal Reserve Act provides that— The required balance carried by a member bank with a Federal Reserve Bank may, under the regulations and subject to such penalties as may be prescribed by the Federal Reserve Board, be checked against and withdrawn by such member bank for the purpose of meeting existing liabilities: Provided, however, That no bank shall at any time make new loans or shall pay any dividends unless and until the total balance required by law is fully restored. It is manifest that items in process of collection can not lawfully be counted as part of the minimum reserve balance to be carried by a member bank with its Federal Reserve Bank. Therefore, should a member bank draw against such items the draft would be charged against its reserve balance if such balance were sufficient in amount to pay it; but any resulting impairment of reserve balances would be subject to all the penalties provided by the act. Inasmuch as it is essential that the law in respect to he mainenance by member banks of the required minimum reserve balance shall be strictly complied with, the Federal Reserve Board, under authority vested in it by section 19 of the act, hereby prescribes as the penalty for any deficiency in reserves a sum equivalent to an interest charge on the amount of the deficiency of 2 per cent per annum above the ninety-day discount rate of the Federal Reserve Bank of the district in which the member bank is located. The Board reserves the right to increase this penalty whenever conditions require it. For the purpose of keeping their reserve balances intact member banks may at all times have recourse to the rediscount facilities offered by their respective Federal Reserve Banks. (8) Each Federal Reserve Bank will determine by analysis the amounts of uncollected funds appearing on its books to the credit of each member bank. Such analysis will show the true status of the reserve held by the Federal Reserve Bank for each member bank and will enable it to apply the penalty for impairment of reserve. 1 In accordance with instructions issued by the Federal Reserve Board on Apr. 24, 1917, the various Federal Reserve Banks have issued circulars setting forth the conditions under which their respective member banks may draw drafts on their Reserve Bank accounts payable with or through any other Federal Reserve Bank. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. 183 A schedule of the time required within which to collect checks will be furnished to each bank to enable it to determine the time at which any item sent to its Federal Reserve Bank will be counted as reserve and become available to meet any checks drawn. (9) In handling items for member and clearing member banks, a Federal Reserve Bank will act as agent only. The Board will require that each member and clearing member bank authorize its Federal Reserve Bank to send checks for collection to banks on which checks are drawn, and, except for negligence, such Federal Reserve Bank will assume no liability. Any further requirements that the Board may deem necessary will be set forth by the Federal Reserve Banks in their letters of instruction to their member and clearing member banks. Each Federal Reserve Bank will also promulgate rules and regulations governing the details of its operations as a clearing house, such rules and regulations to be binding upon all member and nonmember banks which are clearing through the Federal Reserve Bank. (10) The cost of collecting and clearing checks must necessarily be borne by the banks receiving the benefit and in proportion to the service rendered. An accurate account will be kept by each reserve bank of the cost of performing this service and the Federal Reserve Board will, by rule, fix the charge, at so much per item, which may be imposed for the service of clearing or collection rendered by the reserve banks, as provided in section 16 of the Federal Reserve Act. REGULATIONS GOVERNING THE EXPORTATION OF COIN, BULLION, AND CURRENCY. EXECUTIVE OEDEE. By virtue of the authority vested in me, I direct that the regulations, orders, limitations, and exceptions prescribed in relation to the exportation of coin, bullion, and currency shall be administered by and under the authority of the Secretary of the Treasury; and upon the recommendation of the Secretary of the Treasury, I hereby prescribe the following regulations in relation thereto: 1. Any individual, firm, or corporation desiring to export from the United States or any of its Territorial possessions to any foreign country named in the proclamation dated September seventh, nineteen hundred and seventeen, any coin, bullion, or currency shall first file an application in triplicate with the Federal reserve bank of the district in which such individual, firm, or corporation is located, such application to state under oath and in detail the nature of the transaction, the amount involved, the parties directly and indirectly interested, and such other information as may be of assistance to the proper authorities in determining whether the exportation for which a license is desired will be compatible with the public interest. 2. Each Federal reserve bank shall keep a record copy of each application filed with it under the provisions of this regulation and shall forward the original application and a duplicate to the Federal Reserve Board at Washington, together with such information or suggestions as it may believe proper in the circumstances, and shall, in addition, make a formal recommendation as to whether or not in its opinion the exportation should be permitted. 3. The Federal Reserve Board, subject to the approval of the Secretary of the Treasury, is hereby authorized and empowered upon receipt of such application and the recommendation of the Federal reserve bank to make such ruling as it may deem proper in the circumstances and, if in its opinion the exportation in question be compatible with the public interest, to permit said exportation to be made; otherwise to refuse it. WOODEOW WILSON. THE WHITE HOUSE, September 7, 1917. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

184 AisrisruAL REPORT OF THE FEDERAL RESERVE BOARD. BY THE PRESIDENT OF THE UNITED STATES OF AMERICA, A PROCLAMATION. Whereas Congress has enacted and the President has, on the fifteenth day of June, one thousand nine hundred and seventeen, approved a law which contains the following provisions: Whenever during the present war the President shall find that the public safety shall so require, and shall make proclamation thereof, it shall be unlawful to export from or ship from or take out of the United States to any country named in such proclamation any article or articles mentioned in such proclamation, except at such time or times and under such regulations and orders and subject to such limitations and exceptions as the President shall prescribe, until otherwise ordered by the President or by Congress: Provided, however, That no preference shall be given to the ports of one State over those of another. Any person who shall export, ship, or take out, or deliver or attempt to deliver for export, shipment, or taking out, any article in violation of this title, or of any regulation or order made hereunder, shall be fined not more than $10,000, or, if a natural person, imprisoned for not more than two years, or both; and any article so delivered or exported, shipped, or taken out, or attempted to be so delivered or exported, shipped, or taken out, shall be seized and forfeited to the United States; and any officer, director, or agent of a corporation who participates in any such violation shall be liable to like fine or imprisonment, or both. Whenever there m reasonable cause to believe that any vessel, domestic or foreign, is about to carry out of the United States any article or articles in violation of the provisions of this title, the collector of customs for the district in which such vessel is located is hereby authorized and empowered, subject to review by the Secretary of Commerce, to refuse clearance to any such vessel, domestic or foreign, for which clearance is required by law, and by formal notice served upon the owners, master, or person or persons in command or charge of any domestic vessel for which clearance is not required by law, to forbid the departure of such vessel from the port, and it shall thereupon be unlawful for such vessel to depart. Whoever, in violation of any of the provisions of this section shall take, or attempt to take, or authorize the taking of any such vessel out of port or from the jurisdiction of the United States, shall be fined not more than $10,000 or imprisoned not more than two years, or both; and, in adition, such vessel, her tackle, apparel, furniture, equipment, and her forbidden cargo shall be forfeited to the United States. And whereas the President has heretofore by proclamation, under date of the twenty-seventh day of August in the year one thousand nine hundred and seventeen, declared certain exports in time of war unlawful, and the President finds that the public safety requires that such proclamation be amended and supplemented in respect to the articles hereinafter mentioned: Now, therefore, I, Woodrow Wilson, President of the United States of America, do hereby proclaim to all whom it may concern, that the public safety requires that, except at such time or times, and under such regulations and orders, and subject to such limitations and exceptions as the President shall prescribe, until otherwise ordered by the President or by Congress, the following articles, namely: Coin, bullion, and currency shall not, on and after the tenth day of September, in the year one thousand nine hundred and seventeen, be exported from or shipped from or taken out of the United States or its territorial possessions to Albania, Austria-Hungary, Belgium, Bulgaria, Denmark, her colonies, possessions, or protectorates, Germany, her colonies, possessions, or protectorates, Greece, Leichtenstein, Luxembourg, the Kingdom of the Netherlands, Norway, Spain, her colonies, possessions, or protectorates, Sweden, Switzerland or Turkey, Abyssinia, Afghanistan, Argentina, Bolivia, Brazil, China, Chile, Colombia, Costa Rica, Cuba, Dominican Republic, Ecuador, Egypt, France, her colonies, pos- Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. 185 sessions, or protectorates, Guatemala, Haiti, Honduras, Italy, her colonies, possessions, or protectorates, Great Britain, her colonies, possessions, or protectorates, Japan, Liberia, Mexico, Monaco, Montenegro, Morocco, Nepal, Nicaragua, the colonies, possessions, or protectorates of the Netherlands, Oman, Panama, Paraquay, Persia, Peru, Portugal, her colonies, possessions, or protectorates, Roumania, Russia, Salvador, San Marino, Serbia, Siam, Uruguay, or Venezuela. The regulations, orders, limitations, and exceptions prescribed will be administered by and under the authority of the Secretary of the Treasury, from whom licenses in conformity with said regulations, orders, limitations, and exceptions will issue. Except as hereby amended and supplemented, the above-mentioned proclamation under date of August 27, 1917, shall continue in full force and effect. In witness whereof I have hereunto set my hand and caused the seal of the United States of America to be affixed. Done at the city of Washington, this seventh day of September in the year of our Lord one thousand nine hundred and seventeen and of the independence of the United States of America the one hundred and forty-second. WOODEOW WILSON. By the President: ROBERT LANSING, Secretary of State. ADMINISTRATIVE PROCEDURE, METHOD OF MAKING APPLICATION. Individuals firms and corporations desiring to obtain licenses for the exportation of coin, bullion, and currency, must file an application with the Federal reserve bank of the district in which the applicant resides or where the transaction requiring the shipment originates. These applications must be made on a standard form which has been furnished to all Federal reserve banks. EXPORTS OF GOLD. It will be the general policy of the board not to authorize the exportation of gold unless the shipment applied for is shown to be connected in a direct and definite way with a corresponding importation of merchandise for consumption in the United States, but in any case authorization will be granted only where the exportation of gold in payment for such merchandise is found to be compatible with the public interest. In reaching its conclusions, however, the board will consider all attendng circumstances in each particular case. SHIPMENTS OF CANADIAN SILVER COIN AND CURRENCY. Until further notice the board will approve all applications for the exportation of Canadian silver coin and currency without limitation. The Treasury Department has instructed collectors of customs to pass such shipments into Canada when approved by the Federal reserve bank of the district from which the shipments are made. Continuous permits for shipments of Canadian silver coin and currency without requiring an application in each case, may be granted by Federal reserve banks upon condition that each transaction will be reported to it without delay. The Federal reserve banks will transmit to the board weekly reports of all applications of every kind passed upon by them, showing the amount of each shipment. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

186 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. EXPOBTS OF SILVER BULLION AND SILVER COIN OF FOREIGN MINTAGE. Applications for the exportation of silver bullion and silver coin of foreign mintage will in general be approved by the Federal Reserve Board upon recommendation of the Federal Reserve Bank with which the application is filed. UNITED STATES NOTES, NATIONAL BANK NOTES, AND FEDERAL RESERVE NOTES. Applications for the exportation of United States notes, national bank notes, and Federal reserve notes will, as a rule, be approved by the Federal Reserve Board, but each application must come before the board for its determination before shipment is made.. TRAVELERS LEAVING THE COUNTRY. Instructions have been issued by the Treasury Department to collectors of customs to permit travelers leaving the country to carry on their persons or in their baggage: (a) United States notes, national bank notes, and Federal reserve notes not to exceed $5,000 for each adult; (b) American silver dollars, subsidiary silver coins, and silver certificates not to exceed $200 for each adult; (c) Gold coin or gold certificates not to exceed $200 for each adult. Collectors of customs have been informed that in dealing with travelers they may act in accordance with these regulations, without communicating with the Federal Reserve Board or with the Federal Reserve Bank of their district GENERAL. Shipments of coin or currency which appear to be or are suspected of being for enemy account or for the benefit of the enemy, will not be permitted. These regulations are issued subject to change without notice, and no application granted will be regarded as constituting a precedent. FEDERAL RESERVE BOARD, By W. P. G. HARDING, Governor. Approved: W. G. MCADOO, Secretary of the Treasury. WASHINGTON, D. C, September 21, 1917. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Exhibit K.—FOREIGN BRANCHES AUTHORIZED. The Board has authorized the establishment of foreign branches and subbranches of national banks as follows: National City Bank, New York City: " Date authorized. Branch at Buenos Aires, Argentina Sept. 2, 1914 Subbranch at Montevideo, Uruguay * Apr. 16, 1915 Branch at Rio de Janeiro, Brazil Sept. 2 1914 ? Subbranches at Santos, Sao Paulo, Pernambuco, Para, and Bahia, Brazil Dec. 23, 1914 Branch at Habana, Cuba Mar. 17, 1915 Subbranches at Santiago, Matanzas, Cienfuegos, Guantanamo, Camaguey, Cardenas, Manzanillo, Cuba; Kingston, Jamaica; and Santo Domingo, Santo Domingo . Mar. 17, 1915 Branch at Valparaiso, Chile Oct. 18, 1915 Subbranches at Antofagasta and Santiago, Chile Oct. 18, 1915 Branch at Genoa, Italy May 25, 1916 Subbranches at Turin, Milan, Venice, Florence, Rome, Naples, and Palermo, Italy May 25, 1916 Branch at Petrograd, Russia July 5, 1916 Subbranches at Moscow, Odessa, Warsaw, Riga, Baku, Astrakhan, Vladivostok, Sebastopol, Helsingfors, and Vilna, Russia July 5, 1916 Branch at Lima, Peru July 31, 1917 Subbranches at Payta, Callao, and Mollendo, Peru —July 31, 1917 Branch at Caracas, Venezuela July 31, 1917 Subbranches at La Guayra, Porto Cabello, and Maracaybo___ July 31, 1917 Commercial National Bank, Washington, D. C.: Branch at Panama City, Panama Jan. 12, 1915 Branch at Cristobal, Canal Zone Nov. 30, 1914 First National Bank, Boston, Mass.: Branch at Buenos Aires, Argentina Jan. 29, 1917 1 Made an independent branch Dec. 8, 1917. 34365°—18 13 187 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Exhibit L.—LIST OF NATIONAL BANKS GIVEN FIDUCIARY POWERS FROM JAJNXTARY 1, 1917, TO DECEMBER 31, 1917, DISTRICT N. 1. Location. Name of bank. Powers granted. Maine: Bar Harbor First National Bank Trustee, executor, administrator, and registrar of stocks and bonds. Massachusetts: Boston Webster & Atlas National Bank.. Do. Brockton Home National Bank Do. Edgartown Edgartown National Bank Trustee, executor, and administrator. Haver hill Merrimack National Bank Trustee, executor, administrator, and registrar of stocks and bonds. Gardner First National Bank Do. Leominster Merchants National Bank Do. Lynn Manufacturers National Bank Do. Plymouth Plymouth National Bank Do. Wareham National Bank of Wareham Do. Worcester Mechanics National Bank Do. New Hampshire: Concord National State Capital Bank Do. Vermont: Brattleboro Vermont National Bank Trustee, executor, and administrator. Windsor State National Bank Do. DISTRICT NO. 2. Connecticut: Bridgeport... First-Bridgeport National Bank... Registrar of stocks and bonds. New Jersey: Paterson Paterson National Bank Do. Phillipsburg. Phillipsburg National Bank Trustee, executor, administrator, and registrar of stocks and bonds. Red Bank. Second National Bank Do. Somerville. do.. Do. Sussex Farmers National Bank Do. New York: New York. Atlantic National Bank Registrar of stocks and bonds. Do Mechanics & Metals National Bank Do. Oneida Oneida Valley National Bank Do. DISTRICT NO. 3. New Jersey: Camden National State Bank Trustee, executor, administrator, and registrar of stocks and bonds. Pennsylvania: Maytown Maytown National Bank Do. Myerstown Myerstown National Bank Do. Philadelphia Eighth National Bank Do. Do... Philadelphia National Bank Registrar of stocks and bonds. Topton National Bank of Topton Trustee, executor, and administrator. West Grove National Bank of West Grove Trustee, executor, administrator, and registrar of stocks and bonds. Wilkes-Barre Second National Bank Do. Williamsport West Branch National Bank Do. 188 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. 189 DISTRICT NO. 4. Location. Name of bank. Powers granted. Ohio: Akron First-Second National Bank Trustee and registrar of stocks and bonds. Canton First National Bank Registrar of stocks and bonds. Cleveland do Trustee and registrar of stocks and bonds. Do Union National Bank Registrar of stocks and bonds. Mansfield Citizens National Bank Do. Painesville Painesville National Bank Do. Pennsylvania: Pittsburgh German National Bank of Alle- Trustee, executor, administrator, and gheny. registrar of stocks and bonds. West Virginia: New Cumberland First National Bank Trustee. DISTRICT NO. 5. Maryland: Hyattsville. First National Bank Tr r u e s g t i e s e tr , a e r x o e f c s u t t o o c r k , s a a d n m d i n b i o s n tr d a s t . or, and Rising Sun.. National Bank of Rising Sun. Do. North Carolina: Newbern— National Bank of Newbern.... Do. Virginia: Appalachia.. First National Bank Trustee. Danville Trustee, executor, administrator, and ...do registrar of stocks and bonds. West Virginia: Clarksburg. Union National Bank Do. DISTRICT NO. Alabama: Cullman Leeth National Bank Trustee, executor, administrator, and registrar of stocks and bonds. St. Petersburg Central National Bank Trustee, executor, and administrator. Do First National Bank Trustee, executor, administrator, and registrar of stocks and bonds. Georgia: Atlanta Lowry National Bank Do. Macon Fourth National Bank Do. Louisiana: Alexandria First National Bank Do. DISTRICT NO. 7. Indiana: Crawfordsvile . Citizens National Bank . Tr r u e s g t i e s e tr , a e r x o e f c s u t t o o c r k , s a d an m d i n b i o st n r d a s to . r, and Mishawaka First National Bank Do. Monrovia do Do. Muncie Merchants National Bank. Do. Iowa: Council Bluffs.. First National Bank Do. Decorah National Bank of Decorah Do. Dubuque First National Bank Do. Emmetsburg... Emmetsburg National Bank. Do. Gladbrook...... FirstNational Bank Trustee, executor, and administrator. Kanawha ....do Do. Manchester do Trustee, executor, administrator, and registrar of stocks and bonds. Red Oak .do. Do. Waverly .do. Do. Michigan: Battle Creek Central National Bank Do. Benton Harbor.. Farmers & Merchants National Trustee, executor, and administrator. Bank. Birmingham. First National Bank Trustee, executor, administrator, and registrar of stocks and bonds. Flint First National Bank .. Do. Capital National Bank. Do. Lansing. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

190 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. DISTRICT NO. 8. Location. Name of bank. Powers granted. Arkansas: Fordyce First National Bank Trustee, executor, administrator, and registrar of stocks and bonds. Marianna Lee County National Bank Do. Illinois: Metropolis City National Bank Do. Indiana: Mitchell First National Bank Do. Kentucky: Bowling Green American National Bank Trustee and registrar of bonds. Missouri: St. Louis National Bank of Commerce Trustee, executor, administrator, and registrar of stocks and bonds. Springfield Union National Bank Do. DISTRICT NO. South Dakota: Arlington.. First National Bank Trustee, executor, administrator, and registrar of stocks and bonds. Sioux Falls.. Minnehaha National Bank. Do. DISTRICT NO. 10. Colorado: First National Bank., Trustee, executor, administrator, and Fort Collins. registrar of stocks and bonds. Hugo.. ....do Trustee, executor, and administrator. Kansas: Luray.. .do. Do. Salina.. Farmers National Bank Trustee, executor, administrator, and registrar of stocks and bonds. Missouri: Kansas City. First National Bank Do. Nebraska: Norfolk Norfolk National Bank Trustee, executor, and administrator. Omaha United States National Bank.. Registrar of stocks and bonds. Ord First National Bank Trustee, executor, administrator, and registrar of stocks and bonds. Oklahoma: McAlester American National Bank Trustee. Oklahoma City. Do. Wyoming: Farmers National Bank Buffalo Trustee, executor, administrator, and First National Bank registrar of stocks and bonds. Caster. Do. Casper National Bank DISTRICT NO. 11. Louisiana: Shreveport. Commercial National Bank Trustee, executor, administrator, and registrar of stocks and bonds. New Mexico: Carlsbad First National Bank . . Do. Roswell.... Citizens National Bank Trustee, executor, and administrator. Texas: Campbell Campbell National Exchange Do. B*\nk Dallas Tenison National Bank Trustee, executor, administrator, and registrar of stocks and bonds. Orange First National Bank Do. Palestine Royall National Bank Do. San Angelo San Angelo National Bank Trustee, executor, and administrator. DISTRICT NO. 12. Idaho: Boise City. Boise City National Bank. Registrar of stocks and bonds. Moscow First National Bank Trustee, executor, administrator, and registrar of stocks and bonds. Oregon: Marshfield First National Bank of Coos Bay.. Registrar of stocks and bonds. Utah: Salt Lake City. Continental National Bank........ Trustee, executor, administrator, and registrar of stocks and bonds. Washington: Colfax Farmers National Bank. Do. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Exhibit M.—ACCEPTANCES TO 100 PER CENT. The following banks have been granted authority by the Federal Reserve Board to accept drafts and bills of exchange up to 100 per cent of their capital and surplus. This list includes all banks which have been granted such powers up to and including December 31, 1917: District No. 1— Hartford Aetna National Bank, Hartford, Conn. Massasoit-Pocasset National Bank, Fall River, Mass. First National Bank, Boston, Mass. Second National Bank, Boston, Mass. Merchants National Bank, Boston, Mass. National Shawmut Bank, Boston, Mass. Old Colony Trust Co., Boston, Mass. Webster & Atlas National Bank, Boston, Mass. National Union Bank, Boston, Mass. Safety Fund National Bank, Fitchburg, Mass. Mechanics National Bank, New Bedford, Mass. Merchants National Bank, Worcester, Mass. Blackstone Canal National Bank, Providence, R. I. District No. 2— American Exchange National Bank, New York City. Bank of New York, N. B. A., New York City. Atlantic National Bank, New York City. Mechanics & Metals National Bank, New York City. Irving National Bank, New York City. National City Bank, New York City. National Bank of Commerce, New York City. Harriman National Bank, New York City. Chemical National Bank, New York City. Chase National Bank, New York City. Corn Exchange Bank, New York City. National Park Bank, New York City. Citizens National Bank, New York City. Guaranty Trust Co., New York City. Liberty National Bank, New York City. Central Trust Co., New York City. Bankers Trust Co., New York City. Equitable Trust Co., New York City. Importers & Traders National Bank, New York City. W. R. Grace & Co.'s Bank, New York City. Franklin Trust Co., New York City. Seaboard National Bank, New York City. Columbia Trust Co., New York City. Mercantile Bank of the Americas, New York City. First National Bank, Utica, N. Y. 191 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

192 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. District No. 3— Philadelphia National Bank, Philadelphia, Pa. Tradesmen's National Bank, Philadelphia, Pa. Fourth Street National Bank, Philadelphia, Pa. Girard National Bank, Philadelphia, Pa. Market Street National Bank, Philadelphia, Pa. District No. 4— Fifth-Third National Bank, Cincinnati, Ohio. Union National Bank, Cleveland, Ohio. First National Bank, Cleveland, Ohio. Cleveland Trust Co., Cleveland, Ohio. Union Trust Co., Pittsburgh, Pa. District No. 5: Merchants-Mechanics' First National Bank, Baltimore, Md. Farmers & Merchants' National Bank, Baltimore, Md. Murchison National Bank, Wilmington, N. C. Bank of Charleston, N. B. A., Charleston, S. C. People's National Bank, Charleston, S. C. First National Bank of Danville, Va. Merchants' National Bank, Hampton, Va. Norfolk National Bank, Norfolk, Va. Seaboard National Bank. Norfolk, Va. Merchants' National Bank, Richmond, Va. American National Bank, Richmond, Va. First National Bank, Richmond, Va. District No. 6: Central National Bank, Albany, Ala. Farmers & Merchants' National Bank, Troy, Ala. American National Bank, Cordele, Ga. Fourth National Bank, Macon, Ga. National Bank of Savannah, Ga. Savannah Bank & Trust Co., Savannah, Ga. Whitney-Central National Bank, New Orleans, La. Commercial National Bank, New Orleans, La. New Orleans National Bank, New Orleans, La. District No. 7: First National Bank, Chicago, 111. National Bank of the Republic, Chicago, 111. Continental & Commercial National Bank, Chicago, 111. Merchants' Loan & Trust Co., Chicago, 111. District No. 8: First National Bank, Canton, Miss. District No. 10: First National Bank, Hutchinson, Kans. First National Bank, St. Joseph, Mo. District No. 11: American Exchange National Bank, Dallas, Tex. Tenison National Bank, Dallas Tex. City National Bank, Dallas, Tex. American National Bank, Fort Worth, Tex. South Texas Commercial National Bank, Houston, Tex. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. 193 District No. 12: First National Bank, Portland, Oreg. Northwestern National Bank, Portland, Oreg. Anglo & London-Paris National Bank, San Francisco, Cal. First National Bank, San Francisco, Cal. Wells-Fargo Nevada National Bank, San Francisco, Cal. Bank of California, N. A., San Francisco, Cal. Crocker National Bank, San Francisco, Cal, American National Bank, San Francisco, Cal. National Bank of Commerce, Seattle, Wash. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Exhibit N—PERSONNEL AND SALARIES. Salaries of officers and employees of Federal Reserve Banks. FEDERAL RESERVE BANK OF BOSTON. Number of officers and employees. Salaries. Departments. 1915 1916 1917 1915 1916 1917 Chairman and Federal Reserve agent. 1 $10,000 $10,000 $12,000 Governor 1 15,000 20,000 20,000 Other officers 5 8,500 10,900 17,500 Banking department 55 6,100 15,260 57,700 Bookkeeping department 17 3,100 11,360 16,530 Transit department.: 30 2,100 24,460 24,964 Federal Reserve agent's department.. 4 2,500 3,680 7,100 Fiscal agency department 112 106,200 General 13 23 3,580 10,280 20,378 Total. 20 71 248 50,880 105,940 288,372 FEDERAL RESERVE BANK OF NEW YORK. Chairman and Federal Reserve agent. 1 $16,000 $16,000 $20,000 Governor 1 30,000 15,000 30,000 Deputy governor * 2 20,000 45.000 Other officers 8 32,800 42,000 56,200 Banking department 287 60,588 97,552 301,648 Bookkeeping department '... 15 4,620 10,700 15,360 Transit department 168 6,430 36,480 94,480 Federal Reserve agent's department.. 6 9,520 Fiscal agency department: Bond issue 213 248,284 Certificates of indebtedness 34 45,340 Government deposit 52 67,308 General - 42 5,540 I 8,460 37,440 Total. 73 173 155,978 246,192 970,580 FEDERAL RESERVE BANK OF PHILADELPHIA. Chairman and Federal Reserve agent. $10,000 $10,000 $10,000 Governor 20,000 20,000 20,000 Other officers 5,000 10,200 21,250 Banking department 14,400 15,940 34,084 Bookkeeping department 3,300 9,360 18,080 Transit department 5,880 24,180 47,790 Federal Reserve agent's department.. 5,976 7,140 8,060 Fiscal agency department 23,160 General 19 23 25 12,480 14,672 16,848 Total. 45 192 77,036 111,492 199,272 FEDERAL RESERVE BANK OF CLEVELAND. Chairman and Federal Reserve agent. 1 $10,000 $10,000 $12,000 Governor 1 18,000 20,000 20,000 Other officers 3 7,000 10, 750 21,050 Banking department n 16,900 13,430 23,800 Bookkeeping department 5,160 4,380 19,080 Transit department - 36| 1,080 23,370 52,710 Federal Reserve agent's department.. 2 3,500 3,780 7,820 Fiscal agency department 87,180 General 10 10 6,900 8,040 16,440 Total. 31 65 68,540 93,750 260,080 » Total deputy governors, 3; one serving without pay. 194 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. 195 Salaries of officers and employees of Federal Reserve Banks—Continued. FEDERAL RESERVE BANK OF RICHMOND. Number of officers and employees. Salaries. Departments. 1915 1916 1917 1915 1916 1917 Chairman and Federal Reserve agent. $10,000 $10,000 $10,000 Governor 10,000 12,000 15,000 Other officers 5,978 9,428 14,550 Banking department 12,742 13,956 22,880 Bookkeeping department 4,748 5,520 4,980 Transit department 2,278 11,599 21,954 Federal Reserve agent's department.. 945 916 2,400 Fiscal agency department 21,024 General 6,439 8,819 8,540 Total. 30 63 109 53,130 72,238 121,328 FEDERAL RESERVE BANK OF ATLANTA (INCLUDING NEW ORLEANS BRANCH). Chairman and Federal Reserve agent. $7,500 $9,000 $10,000 Governor 9,000 9,000 10,000 Other officers 13,100 12,060 11,380 Banking department 23,928 21,828 37,690 Bookkeeping department 3,600 5,100 6,480 Transit department 1,260 15,900 20,180 Federal Reserve agent's department.. 3,200 4,380 5,220 Fiscal agency department 61,010 General 3,180 4,0 3,120 Total. 41 65 132 64,768 81,348 165,080 FEDERAL RESERVE BANK OF CHICAGO. Chairman and Federal Reserve agent. 1 $10,000 $10,000 $10,000 Governor „ 1 20,000 20,000 24,000 Other officers 7 14,000 17,500 33,500 Banking department 33 36 21,426 31,880 47, 880 Bookkeeping department 10 4,100 8.700 9,520 Transit department 61 8,700 30; 240 49,280 Federal Reserve agent's department. - 5 7,200 7,800 13,800 Fiscal agency department 166 215, 930 General 13 21 77 11,134 20,985 61,130 Total. 50 110 364 96,560 147,105 465,040 FEDERAL RESERVE BANK OF ST. LOUIS (INCLUDING LOUISVILLE BRANCH). Chairman and Federal Reserve agent. $10,000 $10, 000 $10,000 Governor 20,000 20,000 20,000 Other officers 13,500 13,500 35,500 Banking department 12,820 17,180 44,500 Bookkeeping department 6,200 6,260 5,900 Transit department 9,660 16,140 34,620 Federal Reserve agent's department. - 5,900 5,900 3,340 Fiscal agency department 65, 840 General * 2,820 2,820 4,920 Total. 39 53 177 80, 900 91,800 224,620 FEDERAL RESERVE BANK OF MINNEAPOLIS. Chairman and Federal Reserve agent.. $7,500 $9,000 $10,000 Governor 15,000 15,000 18, 000 Other officers 3,000 3,500 12,500 Banking department 11,940 15,850 29,120 Bookkeeping department 2,460 5,540 6,040 Transit department 2,000 19,460 24,040 Federal Reserve agent's department. - 5,520 4,080 4,580 Fiscal agency department 51,180 Total. 20 54 127 47,420 72,430 155,460 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

196 ANNUAL BEPORT OF THE FEDERAL RESERVE BOARD. Salaries of officers and employees of Federal Reserve Banks—Continued. FEDERAL RESERVE BANK OF KANSAS CITY. Number of officers Salaries. and employees. Departments. 1915 1916 1917 1915 1916 1917 Chairman and Federal Reserve agent. $7,500 $7,500 $7,500 Governor 7,500 10,000 12,500 Other officers 6,000 8,800 17,400 Bookkeeping department 6,120 4,500 5,340 Transit department 10,980 18,780 22,960 Federal Reserve agent's department.. 4,080 4,380 7,680 Fiscal agency department 93,190 General 12 15 27 13,460 18,460 27,020 Total.. 40 153 55,640 72,420 193,590 FEDERAL RESERVE BANK OF DALLAS. Chairman and Federal Reserve agent. $7,500 $9, $10,000 Governor 10,000 10, 12,000 Other officers 11,000 15, 19,700 Banking department 17,140 17, 39,300 Bookkeeping department. 1,620 5, 6,360 Transit department 2,100 20, 33,140 Federal Reserve agent's department.. 7,400 3, 3,700 Fiscal agency department 60,690 General 10 12 10 9,060 11,680 7,580 Total. 31 63 170 65,820 93,000 192,470 FEDERAL RESERVE BANK OF SAN FRANCISCO (INCLUDING SPOKANE, PORTLAND, AND SEATTLE BRANCHES.) Chairman and Federal Reserve agent. 1 $12,000 $12,000 $14,000 Governor 1 15,000 15,000 18,000 Other officers 10 10,200 12,200 39,500 Tellers 11 4,200 4,860 15,240 Discount department 8 2,820 2,880 11,460 Transit department 31 780 11,640 28,740 Bookkeeping department 17 2,520 4,620 18,240 General 61 7,200 23,810 63,140 Auditixig department 8 2,400 3,300 12,186 Federal Reserve agent's department... 3 7,000 1,620 3,420 Fiscal agency department 122 146,100 Total. 22 62 273 64,120 91,930 370,026 SALARIES or OFFICERS AND EMPLOYEES OF THE FEDERAL RESERVE BOARD AS OF DECEMBER 31, 1917. OFFICE OF THE SECRETARY. H. Parker Willis, secretary $9, 000 Sherman Allen, assistant secretary and fiscal agent 6, 000 1 at $2,250 2,250 1 at $2,100 2,100 1 at $1,500 1,500 2 at $1,440 2,880 1 at $1,320 1,320 1 at $1,200 1,200 1 at $1,000 1,000 2 at $900 1, 800 $29, 050 ~, ™. OFFICES OF MEMBERS OF THE BOARD. 5 at $2,700 13, 500 1 at $1,800 1, 800 5 at $1,440 7, 200 22, 500 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. 197 OFFICE OF COUNSEL. Milton C. Elliott, counsel $9, 000 J. P. Cotton, consulting counsel 2, 000 Staff: 1 at $4,500 4, 500 1 at $2,100 _" 2,100 1 at $1,800 1,800 1 at $1,440 1,440 1 at $1,320 1, 320 $22,160 DIVISION OF AUDIT AND EXAMINATION. Joseph A. Broderick, chief of division 7, 200 2 at $3,600 7,200 1 at $2,800 2, 800 1 at $1,600 1,600 2 at $1,500 3,000 3 at $1,320 3,960 1 at $1,200 1,200 1 at $420 420 27,380 DIVISION OF REPORTS AND STATISTICS. Morris Jacobson, chief of division 4,200 Staff: 1 at $2,250 2,250 1 at $2,000 2, 000 1 at $1,800 1,800 3 at $1,650 4, 950 1 at $1,500 1,500 1 at $1,400 1, 400 1 at $1,200 1,200 1 at $1,000 1,000 1 at $3 per diem. 20,300 121, 390 DIVISION OF FOEEIGN EXCHANGE. Staff: 1 at $4,000 4,000 1 at $1,320 1,320 - O, o^U DIVISION OF ISSUE AND REDEMPTION. Willard E. Buell, chief of division 2, 500 Staff: 1 at $1,900 1,900 1 at $1,320 1, 320 1 at $1,200 1, 200 3 at $960 2,880 4 at $900 i 3, 600 13,400 MESSENGERS. 2 at $900 1, 800 5 at $840 4, 200 6,000 CHARWOMEN. 3 at $264 792 Total •__ 146, 902 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

198 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. SALARIES OF NATIONAL-BANK EXAMINERS EFFECTIVE IN THE YEAR ENDING DEC. 31, 1917. Stephen L. Newnham, supervising examiner, not assigned to any Federal Reserve District $4, 200 DISTRICT NO. 1—BOSTON. (3S0 national member banks.) James D. Brennan, chief examiner $8, 000 2 examiners, at $3,600; 1 examiner, at $3,000; 1 examiner, at $2,700; 1 examiner, at $2,400 15.300 23,300 DISTRICT NO. 2 NEW YORK. (624 national member banks.) William P. Malburn, chief examiner 15, 000 1 examiner, at $4,200; 1 examiner, at $3,900; 1 examiner, at $3,600; 2 examiners, at $3,300; 2 examiners, at $3,000; 3 examiners, at $2,700 32, 400 47,400 DISTRICT NO. 3—PHILADELPHIA. (631 national member banks.) Edward I. Johnson, chief examiner 8, 000 1 examiner, at $4,500; 1 examiner, at $4,200; 1 examiner, at $3,600; 1 examiner, at $3,300; 2 examiners, at $3,000; 1 examiner, at $2,700; 3 examiners, at $2,400 31.500 • 39, 500 DISTRICT NO. 4 CLEVELAND. (750 national member banks.) Silas H. L. Cooper, chief examiner 8.000 1 examiner, at $5,500; 3 examiners, at $3,900; 2 examiners, at $3,600; 1 examiner, at $2,700; 3 examiners, at $2,400 34.300 42,300 DISTRICT NO. 5—RICHMOND. (518 national member banks.) James K. Doughton, chief examiner 6,500 1 examiner, at $6,000; 4 examiners, at $3,300; 3 examiners, at $3,000; 2 examiners, at $2,700; 1 examiner, at $2,400 36, 000 • 42,500 DISTRICT NO. 6 ATLANTA. (372 national member banks.) Elmore F. Higgins, chief examiner 6, 500 1 examiner, at $3,600; 3 examiners, at $3,000; 1 examiner, at $2,400 . 15, 000 21,500 DISTRICT NO. 7—CHICAGO. (1,042 national member banks.) Sherrill Smith, chief examiner 12, 000 1 examiner, at $5,000; 1 examiner, at $4,200; 1 examiner, at $3,900; 1 examiner, at $3,600; 3 examiners, at $3,300; 5 examiners, at $3,000; 2 examiners, at $2,700; 3 examiners, at $2,400 54, 200 Digitized for FRASER • 66, 200 http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. 199 DISTRICT NO. 8 ST. LOUIS. (466 national member banks.) Joseph M. Logan, chief examiner $7, 500 2 examiners, at $4,200; 1 examiner, at $3,600; 1 examiner, at $3,300; 1 examiner at $3,000; 3 examiners, at $2,400 25, 500 $33, 000 DISTRICT NO. 9 MINNEAPOLIS. (764 national member banks.) Peter M. Kerst, chief examiner 8, 000 2 examiners, at $3,900; 1 examiner, at $3,600; 1 examiner, at $3,300; 2 examiners, at $3,000; 3 examiners, at $2,400 27, 900 35,900 DISTRICT NO. 10 KANSAS CITY. (948 national member banks.) Jay D. Rising, chief examiner 6, 500 2 examiners, at $3,900; 1 examiner, at $3,600; 2 examiners, at $3,300; 1 examiner, at $3,000; 3 examiners, at $2,700; 5 examiners, at $2,400 -, 41,100 47,600 DISTRICT NO. 11 DALLAS. (619 national member banks.) Richard H. Collier, acting chief examiner 4, 500 1 examiner, at $3,900; 2 examiners, at $3,300; 2 examiners, at $3,000; 1 examiner, at $2,700; 1 examiner, at $2,400 21, 600 26,100 DISTRICT NO. 12 SAN FRANCISCO. (534 national member banks.) Claud Gatch, chief examiner 8,500 1 examiner, at $6,000; 2 examiners, at $4,500; 1 examiner, at $3, 900; 1 examiner, at $3,300; 4 examiners, at $2,700; 3 examiners, at $2,400 40.200 48, 700 Total 478, 200 RECAPITULATION. Examining staff: Chief examiners— At $15,000 per annum 1 At $12,000 per annum 1 At $8,500 per annum 1 At $8,000 per annum 4 At $7,500 per annum 1 At $6 500 per annum 3 At $4,500 per annum 31 Total chief examiners 12 Salaries, chief examiners 99,000 1 Acting. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

200 ANNUAL REPORT OF THE FEDERAL RESERVE BOAJEtD. Other examiners— At $6,000 per annum 2 At $5,500 per annum 1 At $5,000 per annum 1 At $4,500 per annum 3 At $4,200 per annum *6 At $3,900 per annum 11 At $3,500 per annum 11 At $3,300 per annum 17 At $3,000 per annum 22 At $2,700 per annum 18 At $2,400 per annum 27 Total other examiners 119 Salaries, other examiners $379, 200 Total examining staff 131 Total salaries 478, 200 1 Includes 1 supervising examiner. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Exhibit O.—DIRECTORY OF THE FEDERAL RESERVE BOARD AND FEDERAL RESERVE BANKS. FEDERAL RESERVE BOARD. EX OFFICIO MEMBERS. W. P. G. HARDING, Governor. PAUL M. WARBURG, Vice Governor. WILLIAM G. MCADOO, FREDERIC A. DELANO. Secretary of the Treasury, ADOLPH G. MILLER. Chairman. CHARLES S. HAMLIN. JOHN SKELTON WILLIAMS, Comptroller of the Currency. H. PARKER WILLIS, Secretary. SHERMAN ALLEN, Assistant Secretary and Fiscal Agent. M. C. ELLIOTT, Counsel. OFFICERS AND DIRECTORS OF FEDERAL RESERVE BANKS. DISTRICT NO. l.-FEDERAL RESERVE BANK OF BOSTON. [Frederic H. Curtiss, chairman and Federal Reserve Agent. Allen Hollis, deputy chairman. Chas. A. Morss, governor.] D irector. Residence. Term expires. Class A: T P Beal . Boston, Mass Dec. 31,1920 Thomas W. Farnam New Haven, Conn Dec. 31 1919 A M Heard Manchester N. H Dec. 31,1918 Class B: Chas A Morss . ... Boston, Mass. Dec. 31 1920 E R Morse Proctor Vt Dec. 31,1919 Chas. G. Washburn Worcester, Mass Dec. 31 1918 Class C: Frederic H Curtiss Boston Mass Dec. 31,1920 Allen Hollis . . Coneord, N. H Dec. 31,1918 DISTRICT NO. 2.-FEDERAL RESERVE BANK OF NEW YORK. [Pierre Jay, chairman and Federal Reserve Agent. George F. Peabody, deputy chairman and deputy reserve agent. Benjamin Strong, jr., governor.] Director. Residence. Term expires. Class A: William Woodward New York, N. Y Dec. 31,1919 R. H. Treman Ithaca, N. Y Dec. 31,1920 F. D. Locke Buffalo, N. Y Dec. 31,1918 Class B: H. R. Towne New York, N. Y Dec. 31,1919 W. B. Thompson Yonkers, N. Y Dec. 31,1920 L. R. Palmer Croton-on-Hudson, N. Y Dec. 31,1918 Class C: Pierre Jay New York, N. Y Dec. 31,1919 George F. Peabody Lake George, N. Y Dec. 31,1918 W. L. Saunders New York, N. Y Dec. 31,1920 201 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

202 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. DISTRICT NO. 3.-FEDERAL RESERVE BANK OF PHILADELPHIA. [Richard L. Austin, chairman and Federal Reserve Agent. H. B. Thompson, deputy chairman. Charles J. Rhoads, governor.] Director. Residence. Term expires. Class A: Joseph Wayne, jr Philadelphia, Pa Dec. 31,1920 W. H. Peck Scranton, Pa Dec. 31,1918 M. J. Murphy Clarks Green, Pa., Dec. 31,1919 Class B: A. B. Johnson Philadelphia, Pa Do. E. S. Stuart do Dec. 31,1920 G. W. F. Gaunt MullicaHill, N. J Dec. 31,1918 Class C: Richard L. Austin Philadelphia, Pa Dec. 31,1920 H.B.Thompson Wilmington, Del.. Dec. 31,1919 Chas. C. Harrison Philadelphia, Pa Dec. 31,1918 DISTRICT NO. 4.-FEDERAL RESERVE BANK OF CLEVELAND. [D. C. Wills, chairman and Federal Reserve Agent. Lyman H. Treadway, deputy chairman. E. R. Fancher, governor.] Director. Residenco. Term expires. Class A: Robert Wardrop Pittsburgh, Pa Dec. 31,1920 W. S. Rowe Cincinnati, Ohio Dec. 31,1919 S. B. Rankin South Charleston, Ohio Dec. 31,1918 Class B: T. A. Combs Lexington, Ky Dec. 31,1920 R.P.Wright Erie, Pa Dec. 31,1919 John Stambaugh Youngstown, Ohio Dec. 31,1918 Class C: D C Wills Bellevue, Pa .... Dec. 31,1920 Lyman H. Treadway Cleveland, Ohio Dec. 31,1919 H. P. Wolfe Columbus Ohio.. Dec. 31,1918 DISTRICT NO. 4.-CINCINNATI BRANCH OF FEDERAL RESERVE BANK OF CLEVELAND. [L. W. Manning, manager.] Director. Residence. Term expires. W. S. Rowe Cincinnati, Ohio. Dec. 31,1918 L. W. Manning.. do Do. W. C Procter.... do Do. Judson Harmon.. do Do. Chas. A. Hinsch. do Do. DISTRICT NO. 4. -PITTSBURGH BRANCH OF FEDERAL RESERVE BANK OF CLEVELAND. [George De Camp, manager.] Director. Residence. Term expires. R.B.Mellon..... Pittsburgh, Pa.. Dec. 31,1918 Chas. W. Brown. .do. Do. James D. Callery. .do. Do. T. H. Given .do., Do. George De Camp.. .do.. Do. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

ANNUAL REPORT OF THE FEDERAL RESERVE BOARD.. 203 DISTRICT NO. 5.—FEDERAL RESERVE BANK OF RICHMOND. [Caldwell Hardy, chairman and Federal Reserve Agent. James A. Moncure, deputy chairman. George J. Seay, governor.] Director. Residence. Term expires. Class A: H. B. Wilcox Baltimore, Md Dec. 31, 1918 J. F. Bruton Wilson, N. C Dec. 31, 1919 Edwin Mann Bluefield, W. Va Dec. 31, 1920 Class B: Edmund Strudwick Richmond, Va Dec. 31, 1918 D.R.Coker Hartsville, S. C Dec. 31, 1920 D. F. Oyster Washington, D. C Dec. 31, 1919 Class C: James A. Moncure Richmond, Va Do. Caldwell Hardy Norfolk, Va Dec. 31, 1920 DISTRICT NO. 6-FEDERAL RESERVE BANK OF ATLANTA. [M. B. Wellborn, chairman and Federal Reserve Agent. Edward T. Brown, deputy chairman. Joseph A. McCord, governor.] Director. Residence. Term expires. Class A: L. P. Hillver Macon, Ga Dec. 31, 1918 F. W. Foote Hattiesburg, Miss Dec. 31, 1919 P. R. Kittles Sylvania, Ga Dec. 31, 1920 Class B: Edgar B. Stern New Orleans, La Do. J. A. McCrary Decatur, Ga Dec. 31, 1918 W. H. Hartford Nashville, Term Dec. 31, 1919 Class C: M. B. Wellborn Anniston, Ala Dec. 31, 1920 Edward T. Brown Atlanta, Ga Dec. 31, 1918 W. H.Kettig Birmingham, Ala Dec. 31, 1919 DISTRICT NO. 6—NEW ORLEANS BRANCH OF FEDERAL RESERVE BANK OF ATLANTA. [James E. Zunts, chairman. Marcus Walker, manager. W. D. Wellborn, Representative Federal Reserve Agent.] Director. Residence. Term expires. Frank Roberts . Lake Charles, La Dec. 31, 1918 J. E. Bouden, Jr New Orleans, La Do. J . J. G annon . . do Do. H .B. Lightcap Jackson, Miss Do. Edgar B. Stern * New Orleans, La Do. A P Bush Mobile, Ala Do. Jas. E. Zunts New Orleans, La Do. DISTRICT NO. 7.—FEDERAL RESERVE BANK OF CHICAGO. [William A. Heath, chairman and Federal Reserve Agent. James Simpson, deputy chairman. James B. McDougal, governor.] Director. Residence. Term expires. Class A: Geo. M. Reynolds Chicago, 111 Dec. 31, 1918 J. B. Forgan do Dec. 31, 1919 E. L. Johnson. Waterloo, Iowa Dec. 31, 1920 Class B: John W. Blodgett Grand Rapids, Mich Dec. 31, 1919 M. B. Hutchison Ottumwa, Iowa Dec. 31, 1920 A. H. Vogel Milwaukee, Wis Dec. 31, 1918 Class C: William A. Heath Evanston, 111 Do. James Simpson Chicago, 111 Dec. 31, 1920 E. T. Meredith Des Moines, Iowa Dec. 31, 1919 34365°-—18 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

204 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. DISTRICT NO. 7—DETROIT BRANCH OF FEDERAL RESERVE BANK OF CHICAGO. [Robert B. Locke, manager.] Director. Residence. Term expires. Robert B. Locke Detroit, Mich... Dec. 31, 1918 John Ballantyne - - . .do.... Do Chas. H. Hodges.. . . do Do. Emory W. Clark do Do. Julius H. Haass . .do. . .. Do. DISTRICT NO. 8.—FEDERAL RESERVE BANK OF ST. LOUIS. [William McC. Martin, chairman and Federal Reserve Agent. Holla Wells, governor.] Director. Residence. Term expires. Class A: Walker Hill St Louis, Mo Dec. 31,1920 F.O. Watts . . . .do . ... Dec. 31,1918 Sam A. Ziegler Albion, 111 Dec. 31,1919 Class B: David C. Biggs St. Louis, Mo Dec. 31,1918 W. B. Plunkett. Little Rock, Ark . Dec. 31,1919 Leroy Percy Greenville, Miss Dec. 31,1920 Class C: W. McC. Martin St. Louis, Mo Dec. 31,1918 John W. Boehne Evansville, Ind Dec. 31,1920 C. P. J. Mooney Memphis, Tenn Dec. 31,1919 DISTRICT NO. 8.—LOUISVILLE BRANCH OF FEDERAL RESERVE BANK OF ST. LOUIS. [W. P. Kincheloe, manager.] Director. Residence. Term expires. George W. Norton Louisville Kv Dec 31 1918 W P. Kincheloe do Do. F. M. Sackett . . . .do Do. W C. Montgomery Elizabeth town, Kv Do. Chas E Hoge Frankfort Kv Do. DISTRICT NO. 9.—FEDERAL RESERVE BANK OF MINNEAPOLIS. [John H. Rich, chairman and Federal Reserve Agent. Wm. II. Lightner, deputy chairman. Theodore Wold, governor.] Director. Residence. Term expires. Class A: E.W. Decker Minneapolis, Minn Dec. 31,1919 L. B. Hanna Fargo, N. Dak Dec. 31,1920 J. C. Bassett Aberdeen, S. Dak Dec. 31,1918 Class B: F R Bigelow St. Paul, Minn . . . Dec. 31,1919 F. P.IIixon La Crosse, Wis Dec. 31,1918 N. B. Holter Helena, Mont Dec. 31,1920 Class C: John II. Rich Red Wing, Minn Do. Wm II I/ightner St. Paul, Minn Dec. 31,1918 John W. Black Houghton, Mich Dec. 31,1919 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. 205 DISTRICT NO. 10.—FEDERAL RESERVE BANK OF KANSAS CITY. [Chas. M. Sawyer, chairman and Federal Reserve Agent. F. W. Fleming, deputy chairman. J. Z. Miller, jr., governor.] Director. Residence. Term expires. Class A: J.C.Mitchell Denver, Colo.. Dec. 31,1918 W. J. Bailey Atchison, Kans.. Dec. 31,1919 C. E.Burnham Norfolk, Nebr Dec. 31,1920 Class B: M. L. McClure Kansas City, Mo. Dec. 31,1919 T.C. Byrne Omaha, Nebr Dec. 31,1918 Harry W. Gibson Muskogee, Okla.. Dec. 31,1920 Class C: Asa E. Ramsay Kansas City, Mo. Do. F. W. Fleming .do. Dec. 31,1919 R. H. Malone Denver, Colo Dec. 31,1918 DISTRICT NO. 10.—DENVER BRANCH OF FEDERAL RESERVE BANK OF KANSAS CITY. [C. A. Burkhardt, manager.] Director. Residence. Term expires. C.C. Parks Denver. Colo Dec. 31,1918 A C Foster do Do. C A Burkhardt do Do. John Evans ....do Do. Alva Adams Pueblo, Colo. Do. DISTRICT NO. 10.—OMAHA BRANCH OF FEDERAL RESERVE BANK OF KANSAS CITY. [O. T. Eastman, manager.] Director. Residence. Term expires. Luther Drake Omaha, Nebr Dec. 31,1918 J C McNish .do Do. O T Eastman do Do. P L Hall Lincoln Nebr Do R. O.Marnell... Nebraska City, Nebr Do. DISTRICT NO 11.—FEDERAL RESERVE BANK OF DALLAS. [W. F. Ramsey, chairman and Federal Reserve Agent. W. B. Newsome, deputy chairman. R. L. Van Zandt, governor.] Director. Residence. Term expires. Class A: J. T. Scott Houston, Tex Dec. 31,1918 E. K. Smith Shreveport, La Dec. 31,1920 B. A. MeKinney Durant, Okla Dec. 31,1919 Class B: Marion Sansom Fort Worth, Tex Do. Frank Kell Wichita Falls, Tex Dec. 31,1918 ClasJs. CJ.: Culbertson Paris, Tex . Dec. 31,1920 W. F. Ramsey Dallas, Tex Do. W. B. Newsome ...do Dec. 31,1918 H. O. Wooten Abilene, Tex Dec. 31,1919 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

206 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. DISTRICT NO. 12.—FEDERAL RESERVE BANK OF SAN FRANCISCO. [John Perrin, chairman and Federal Reserve Agent. Walton N. Moore, deputy chairman. James K. Lynch, governor.] Director. Residence. Term expires. Class A: C. K. Mclntosh San Francisco, Cal. Dec. 31,1919 J. E. Fishburn Los Angeles, Cal... Dec. 31,1920 Alden Anderson Sacramento, Cal... Dec. 31,1918 Class B: A. B. C. Dohrmann.. San Francisco, Cal. Dec. 31,1920 J. A. McGregor .do. Dec. 31,1918 E.H. Cox Madera, Cal Dec. 31,1919 Class C: John Perrin Pasadena, Cal Dec. 31,1920 Edward G.Elliott.. Berkeley, Cal :. Dec. 31,1919 Walton N.Moore... San Francisco, Cal. Dec. 31,1918 DISTRICT NO. 12.—PORTLAND BRANCH OF FEDERAL RESERVE BANK OF SAN FRANCISCO. [W. N. Ambrose, acting manager.] Directors. Residence. Term expires. A L Mills . . . Portland, Oreg Dec. 31,1918 J. C. Ainsworth do Do. W N Ambrose .do Do. Nathan Strauss do Do. Thomas C. Burke . .. do Do. DISTRICT NO. 12.—SEATTLE BRANCH OF FEDERAL RESERVE BANK OF SAN FRANCISCO. [C. J. Shepherd, manager.] Directors. Residence. Term expires. M F Backus Seattle,Wash Dec. 31,1918 N.H. Latimer . .. do. Do. C J. Shepherd do Do. Chas II. Clarke . . do Do. Chas E Peabodv do Do. DISTRICT NO. 12.—SPOKANE BRANCH OF FEDERAL RESERVE BANK OF SAN FRANCISCO. [Chas. A. McLean, manager.] Directors. Residence. Term expires. E.T. Coman Spokane, Wash. Dec. 31,1918 D. W. Twohy do Do. Chas. A. McLean. do Do. Peter McGregor.. do Do. G.I. Toevs do Do. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. 207 FEDERAL ADVISORY COUNCIL. District No. 1.—Daniel G. Wing, president First National Bank, Boston, Mass. District No. 2.—J. P. Morgan, of J. P. Morgan & Co., New York City. District No. 3.—L. L. Rue, president Philadelphia National Bank, Philadelphia, Pa. District No. 4.—W. S. Rowe, president First National Bank, Cincinnati, Ohio; director Federal Reserve Bank of Cleveland. District No. 5,—J. W. Norwood, president Norwood National Bank, Greenville, S. C. District No. 6.—Charles A. Lyerly, president First National Bank, Chattanooga, Tenn. District No. 7.—James B. Forgan, president First National Bank, Chicago, 111.; director Federal Reserve Bank of Chicago. District No. 8.—F. O. Watts, president Third National Bank, St. Louis, Mo.; director Federal Reserve Bank of St. Louis. District No. 9.—J. R. Mitchell, president Capital National Bank, St. Paul, Minn. District No. 10.—E. F. Swinney, president First National Bank, Kansas City, Mo. District No. 11.—T. J. Record, president City National Bank, Paris, Tex. District No. 12.—Herbert Fleishhacker, president Anglo and London-Paris National Bank, San Francisco. Cal. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Exhibit P.—DESCRIPTION OF FEDERAL RESERVE DISTRICTS. Below are descriptions of the 12 Federal Reserve districts, accompanied by estimates of the population of each district recently furnished by the Bureau of the Census. No detailed description of Federal Reserve district^ has been issued since the Organization Committee completed its work about four years ago. A map showing outline of the districts is also appended. DISTRICT NO. 1.—BOSTON (6,963,987). Connecticut (except Fair-field County) (975,434). Maine (777,340). Massachusetts (3,775,973). New Hampshire (444,429). Rhode Island (625.805). Vermont (364,946). DISTRICT NO. 2.—NEW YORK (13,111,816). Connecticut (county of Fairfield) (289,939). New Jersey (counties of Monmouth, Middlesex, Hunterdon, Somerset, Union, Essex, Passaic, Hudson, Bergen, Morris, Sussex, and Warren) (2,361,695). New York (10,460,182). DISTRICT NO. 3—PHILADELPHIA (6,632,611). Delaware (215,160). New Jersey (except counties enumerated under District No. 2) (652,499). Pennsylvania (eastern part) (5,764,952). Counties: Adams. Chester. Huntingdon. Monroe. Snyder. Bedford. ClearfielcL Juniata. Montgomery. Sullivan. Berks. Clinton. Lackawanna. Montour. Susquehanna Blair. Columbia. Lancaster. Northampton. Tioga. Bradford. Cumberland. Lebanon. Northumberland. Union. Bucks. Dauphin. Lehigh. Perry. Wayne. Cambria. Delaware. Luzerne. Philadelphia. Wyoming. Cameron. Elk. Lyeoming. Pike. York. Carbon. Franklin. McKean. Potter. Center. Pulton. Mifflin. Schuylkill. 208 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. 209 DISTRICT NO. 4—CLEVELAND (9,314,762). Kentucky (eastern part) (1,039,880). Counties: Bath. Estill. Kenton. Magomn. Pulaski. Bell. Fayette. Knott. Martin. Robertson. Boone. Fleming. Knox. Mason. Rockcastle. Bourbon. Floyd. Laurel. Menifee. Rowan. Boyd. Garrard. Lawrence. Montgomery. Scott. Bracken. Grant. Lee. Morgan. Whitley. Breathitifc. Greenup. Leslie. Nicholas. Wolfe. * Campbell. Harlan. Letcher. Owsley. Woodford. Carter. Harrison. Lewis. Pendleton. Clark. Jackson. Lincoln. Perry. Clay. Jessamine. McCreary. Pike. Elliott. Johnson. Madison. Powell. Ohio (5,212,085). Pennsylvania (western part) (2,895,090). Counties: Allegheny. Clarion. Forest. Lawrence. Warren. Armstrong. Crawford. Greene. Mercer. Washington. Beaver. Erie. Indiana. Somerset. Westmoreland Butler. Fayette. Jefferson. Venango. West Virginia (northern ]part) (167,707). Counties: Brooke. Marshall. Ohio. Tyler. Wetzel. Hancock. DISTRICT NO. 5—RICHMOND (9,278,461). District of Columbia, (369,282). Maryland (1,373,673). North Carolina (2,434,381). South Carolina (1,643,205). Virginia (2,213,025). West Virginia (all counties except Brooke, Hancock, Marshall, Ohio, Tyler ? and Wetzel) (1,244,895). DISTRICT NO. 6—ATLANTA (10,055,640). Alabama (2,363,939). Florida (916,185). Georgia (2,895,841). Louisiana (southern part) (1,260,490). Parishes: Acadia. Iberia. Rapides. Tangipahoa. Allen. Iberville. St. Bernard. Terrebonne. Ascension, Jefferson. St. Charles. Vermilion. Assumption. Jefferson Davis. St. Helena. Vernon. Avoyelles. Lafayette. St. James. Washington. Calcasieu. Lafourche. St. John the Baptist. West Baton Rouge Cameron. Livingston. St. Landry. West Feliciana. East Baton Rouge. Orleans. St. Martin. East Peliciana. Plaquemines. St. Mary. Evangeline. Pointe Coupee. St. Tammany. Mississippi (southern part) (996,935). Counties: Adams. Greene. Jones. Neshoba. Smith. Amite. Hancock. Kemper. Newton. Walthall. Claiborne. Harrison. Lamar. Pearl River. Warren. Clarke. Hinds. Lauderdale. Perry. Wayne. Copiah. Issaquena. Lawrence. Pike. Wilkinson. Covington. Jackson. Leake. Rankin. Yazoo. Forrest. Jasper. Lincoln. Scott. Franklin. Jefferson. Madison. Sharkey. George. Jefferson Davis. Marion. Simpson. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

210 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. Tennessee (eastern part) (1,622,250). Counties: Anderson. Dekalb. Jackson. Monroe. Sevier. Bedford. Dickson. James. Montgomery. Smith. Bledsoe. Fentress. Jefferson. Moore. Stewart. Blount. Franklin. Johnson. Morgan. Sullivan. Bradley. Giles. Knox. Overton. Sumner. Campbell. Grainger. Laurence. Perry. Trousdale. Cannon. Greene. Lewis. Pickett. Unicoi. Carter. Grundy. Lincoln. Polk. Union. Cheatham. Hamblen. Loudon. Putnam. Van Buren. Claiborne. Hamilton. McMinn. Rhea. Warren. Clay. Hancock. Macon. Roane. Washington Cocke. Hawkins. Marion. Robertson. Wayne. Coffee. Hickman. Marshall. Rutherford. White. Cumberland. Houston. Maury. Scott. Williamson. Davidson. Humphreys. Meigs. Sequatchie. • Wilson. DISTRICT NO. 7—CHICAGO (14,154,175). Illinois (northern part) (;4,977,386). Counties: Boone. Douglas. Kankakee. Marshall. Shelby. Bureau. Dupage. Kendall. Mason. Stark. Carroll. Edgar. Knox. Menard. Stephenson. Cass. Ford. Lake. Mercer. Tazewell. Champaign. Fulton. La Salla. Moultrie. Vermilion. Christian. Grundy. Lee. Ogle. Warren. Clark. Hancock. Livingston. Peoria. Whiteside. Coles. Henderson. Logan. Piatt. Will. Cook. Henry. McDonough. Putnam. Winnebago. Cumberland. Iroquois. McHenry. Rock Island. Woodford. Dekalb. Jo Daviess. McLean. Sangamon. Dewitt. Kane. Macon. Schuyler. Indiana (northern part) (2,227,340). Counties: Adams. Delaware. Jay. Newton. Steuben. Allen. Elkhart. Jennings. Noble. Tippecanoe. Bartholomew. Fayette. Johnson. Ohio. Tipton. Benton. Fountain. Kosciusko. Owen. Union. Blackford.. Franklin. Lagrange. Parke. Vermilion. Boone. Fulton. Lake. Porter. Vigo. Brown. Grant. Laporte. Pulaski. Wabash. Carroll. Hamilton. Madison. Putnam. Warren. Cass. Hancock. Marion. Randolph. Wayne. Clay. Hendricks. Marshall. Ripley. Wells. Clinton. Henry. Miami. Rush. White. Dearborn. Howard. Monroe. St. Joseph. Whitley. Decatur. Huntington. Montgomery. Shelby. Dekalb. Jasper. Morgan. Starke. Iowa (2,224,771). Michigan (southern part) (2,721,733). Counties: Alcona. Claire. Isabella. Midland. Presque Isle Allegan. Clinton. Jackson. Missaukee. Roscommon. Alpena. Crawford. Kalamazoo. Monroe. Saginaw. Antrim. Eaton. Kalkaska. Montcalm. St. Clair. Arenac. Emmet. Kent. Montmorency. St. Joseph. Barry- Genesoe. Lake. Muskegon. Sanilac. Bay. Gladwin. Lapeer. Newaygo. Shiawasee. Benzie. Grand Traverse. Leelanau. Oakland. Tuscola. Berrien. Gratiot. Lenawee. Oceana. Van Buren. Branch. Hillsdale. Livingston. Ogenaw. Washtenaw. Calhoun. Huron. Macomb. Osceola. Wayne. Cass. Ingham. Manistee. Oscoda. Wexford. Charlevoix. Ionia. Mason. Otsego. Cheboygan. Iosco. Mecosta. Ottawa. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. 211 Wisconsin (southern part) (2,002,945). Counties : Adams. Fond du Lac. Kewaunee. Oconto. Sheboygan. Brown. Grant. Lafayette. Outagamie. Vernon. Calumet. Green. Langlade. Ozaukee. Walworth. Clark. Green Lake. Manitowoc. Portage, Washington Columbia. Iowa. Marathon. Itacine. Waukesha. Crawford. Jackson. Marinette. Richland. Waupaca. Dane. Jefferson. Marquette. Rock. Waushara. Dodge. Juneau. Milwaukee. Sauk. Winnebago. Door. Kenosha. Monroe. Shawano. Wood. DISTRICT NO. 8—ST. LOUIS (9,291,698). Arkansas (1,766,343). Illinois (southern part) (1,257,609). Counties: Adams. Effingham. Jefferson. Montgomery. Saline. Alexander. Fayette. Jersey. Morgan. Scott. Bond. Franklin. Johnson. Perry. Union. Brown. Gallatin. Lawrence. Pike. Wabash. Calhoun. Greene. Macoupin. Pope. Washington. Clay. Hamilton. Madison. Pulaski. Wayne. Clinton. Hardin. Marion. Randolph. White. Crawford. Jackson. Massac. Richland. Williamson. Edwards. Jasper. Monroe. St. Clair. Indiana (southern part) (608,152). Counties: Clark. Gibson. Knox. Pike. Switzerland. Crawford. Greene. Lawrence. Posey. Vanderburg. Daviess. Harrison. Martin. Scott. Warrick. Dubois. Jackson. Orange. Sullivan. Washington. Floyd. Jefferson. Perry. Spencer. Kentucky (western part) (1,354,213). Counties: Adair. Casey. Hancock. McLean. Shelby. Allen. Christian. Hardin. Marion. Simpson. Anderson. Clinton. Hart. Marshall. Spencer. Ballard. Crittenden. Henderson. Meade. Taylor. Barren. Cumberland. Henry. Mercer. Todd. Boyle. Daviess. Hickman. Metcalfe. Trigg. Breckenridge. Edmonson. Hopkins. Monroe. Trimble. Bullitt. Franklin. Jefferson. Muhlenberg. Union. Butler. Fulton. Lame. Nelson. Warren. Caldwell. Gallatin. Livingston. Ohio. Washington. # Calloway. Graves. Logan. Oldham. Wayne. Carlisle. Grayson. Lyon. Owen. Webster. Carroll. Greene. McCracken. Russell. Mississippi (northern part) (979,635). Counties: Alcorn. Clay. Leflore. Pontotoc. Tunica. Attala. Coahoma. Lowndes. Prentiss. Union. Benton. De Soto. Marshall. Quitman. Washington. Bolivar. Grenada. Monroe. Sunflower. Webster. Calhoun. Holmes. Montgomery. Tallahatchie. Winston. Carroll. Itawamba. Noxubee. Tato. Yalobusha. Chickasaw. Lafayette. Oktibbeha. Tippah. Choctaw. Lee. Panola. Tishomingo. Missouri (eastern part) (2,643,367). Counties: All except those included in district No. 10. Tennessee (western part) (682,379). Counties: Benton. Dyer. Haywood. McNairy. Weakley, Carroll. Fayette. Henderson. Madison. Chester. Gibson. Henry. Obion. Crockett. Hardeman. Lake. Shelby. Digitized foDr FecRaAtuSrE. R Hardin. Lauderdale Tipton. http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

212 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. DISTRICT NO. 9—MINNEAPOLIS (5,164,426), Michigan (northern part) (372.533). Counties: Alger. Delta. Houghton. Luce. Menominee. Baraga. Dickinson. Iron. Mackinac. Ontonagon. Chippewa. Gogebic. Keweenaw. Marquette. Schoolcraft. Minnesota (2,312,445). Montana (472,935). North Dakota (765,319). South Dakota (716,972). Wisconsin (northern part) (524,222). Counties: Ashland. Douglas. La Crosse. Price*. Vilas. Barron. Dunn. Lincoln. Rusk. Washburn. Bayfield. Eau Claire. Oneida. St. Croix. Buffalo. Florence. Pepin. Sawyer. Burnett. Forest. Pierce. Taylor. Chippewa. Iron. Polk. Trempealeau. DISTRICT NO. 10—KANSAS CITY (7,404,443). Colorado (988.320). Kansas (1,851,870). Missouri (western part) (786,228). Counties: Andrew. Buchanan. Dekalb. Jasper. Platte. Atchisorr. Cass. Gentry. McDonald. Vernon Barton. Clay. Holt. Newton. Worth. Bates. Clinton. Jackson. Nodaway. Nebraska (1,284,126). Colfax. Mora. Sandoval. San Miguel. Taos. McKinley. Rio Arriha San J uan. Santa Fe. Union. Oklahoma (all •except southeastern part) (2,112,489). Counties: Adair. Craig. Jackson. Muskogee. Rogers. Alfalfa. Creek. Jefferson. Murray. Roger Mills. Beaver. Delaware. Kay. Noble. Seminole. Blaine, Dewey. Kingfisher. Nowata. Sequoyah. Beckhain. Ellis. Kiowa. Okfuskee. Stephens. Caddo. Garfleld. Latimer. Oklahoma. Texas. Canadian. Garvin. Le Flore. Okmulgee. ,Tulsa. Carter. Grant. Lincoln. Osage. Tillman. Comanche. Grady. Logan. Ottawa. Washita. Cotton. Greer. Love. Pawnee. Wagoner. Custer. Harper. McClain. Payne. Washington Cherokee. Harmon. Mclntosh. Pottawatomie. Woods. Cimarron. Haskell. Major. Pittsburg. Woodward. Cleveland. Hughes. Mayes. Pontotoc. Wyoming (184.970) DISTRICT NO. 11—DALLAS (5,637,290). Arizona (southeastern part) (120,828). Counties: Cochise. Pima. Graham. Santa Cruz. Greenlee. Louisiana (northern part) (596,464). Parishes : Bienville. Clalborno. Jackson. Ouachita. Webster. Bossier. Concordia. La Salle. Red River. West Carroll. Beauregard. De Soto. Lincoln. Richland. Winn. Caddo. East Carroll. Madison. Sabine. Caldwell. Franklin. Morehouse. Tensas. Catahoula. Grant. Natchitoches. Union. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. 213 New Mexico (southern part) (227,209). Counties: Bcrnalillo. Eddy. Lincoln. Quay Socorro. Chaves. Grant. Luna. Roosevelt. Torre nee. Curry. Guadalupe. Otero. Sierra. Valencia. Dona Ana. Oklahoma (southeastern part) (177,366). Counties: Atoka. Choctaw. Johnston. Marshall. Pushmataha Bryan. Coal. McCurtain. Texas (4,515,423). DISTRICT NO. 12—SAN FRANCISCO (6,631,164). Arizona (northwestern part) (142,960). Counties: Apache. Gila. Mohave. Pinal. Yuma. Coconino. Maricopa. Navajo. Yavapai. California (3,029,032). Idaho (445,176). Nevada (110,738). Oregon (861,992). Utah (443,866). Washington (1,597,400), Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

PART II. REPORTS OF FEDERAL RESERVE AGENTS TO FEDERAL RESERVE BOARD. 215 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 1—BOSTON. FREDERIC H. CURTISS, Chairman and Federal Reserve Agent. INTRODUCTION. The year 1917 has been momentous in the history of this country through its entrance on the side of the entente powers into the great European war against the central powers in the struggle of democracy against autocracy. The change of financial and commercial activities of the country, brought about by the declaration of war by Congress, has been felt in New England, owing to the character of its industries, probably as much as, if not more, than in any other portion of the United States. The Federal Eeserve Bank of Boston has played no small part in assisting the Government and the New England banks in financing the new requirements brought about by war conditions. War was declared on April 6, 1917, but previous to that time a large portion of the industries in the district were occupied in manufacturing arms, munitions, and other war requisites for the allied powers. The high cost of labor and of such raw materials as wool, cotton, leather, etc., has kept money in good demand throughout the entire year, so that the resources of the Federal Reserve Banks have been employed to a far greater extent than in previous years, both by discounts for member banks and through purchases in the open market of bankers acceptances. FINANCIAL RESULTS OF OPERATION. The activities referred to brought the earnings of the Federal Reserve Bank to a point largely in excess of those of any previous year and these earnings were such that on December 20, 1917, the board of directors, with the approval of the Federal Reserve Board, declared a dividend at the rate of 6 per cent, covering all accumulated dividends up to December 31, 1917. This dividend amounted to $597,828.54, and covered the period from January 1, 1915, to December 31, 1917. 217 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

218 ANNUAL EEPOKT OF THE FEDERAL RESERVE BOARD. After these dividends were paid and due depreciation of securities had been allowed, a balance of $150,200 still remained, 50 per cent of which was carried to a surplus account and the balance paid to the United States Government as a franchise tax, as provided by the Federal Beserve Act. Schedule 1 shows these earnings in detail as compared with the year 1916. The statement of condition of the bank on December 31, 1917, as compared with December 31, 1916, makes an interesting comparison, as will be seen from Schedule 2. The total resources at the end of the year 1917 were $253,000,000, as compared with $65,000,000 at the end of the year 1916. An increase will be noted in all items making up the balance sheet, the most notable being increases in bills discounted, in deposits of member banks, in Government deposits, and in gold holdings. GENERAL BUSINESS AND BANKING CONDITIONS IN THE DISTRICT. The year opened with peace overtures under discussion by the warring nations. The uncertainty as to the effect of an early ending of the war influenced business men to go slow in their future commitments, but the volume of business in the process of manufacture and orders on hand was so large as to cause great activity in practically all manufacturing lines; more especially those engaged in the making of war materials. Although the high prices prevailing on all raw materials and the increasing cost of labor have made it difficult to forecast the costs of production, the industries in this district for the most part have had a profitable year, and in war lines exceptionally large profits have accrued. Labor troubles, the international situation, embargoes, and other disturbances have created new problems. With the declaration of war, and even before, prices of foodstuffs began to soar and, as the cost of living increased., labor in all lines demanded higher wages. The difficulty in procuring coal and the price of that commodity has been an important factor in the cost of production. With the declaration of war, business more and more turned to Government orders, and banks were called upon to finance to a greater extent industries engaged in such work and subscriptions to bond issues and short-term obligations of the Government. Early in May, business began to show unusual signs of hesitation and the future trend of prices grew more difficult to prognosticate, especially with commodity prices rising and evidences of hoarding and economy appearing. With the successful flotation of the first Liberty loan, business identified with the war was greatly stimulated, but a retarding effect was evident in other lines, especially in luxuries and nonessentials. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 1—BOSTON. 219 This resulted in a spotty condition which, with an ever-increasing separation between war and domestic orders, resulted in the two lines diverging more and more as the year went on. Money rates during the first few months of the year remained low, but as the year advanced the tendency was toward higher rates, strengthening with each offering of certificates of indebtedness by the Secretary of the Treasury until June 15, the date of payment on the first Liberty loan, when rates approached a 6 per cent basis. From that date rates held firm until well into August, easing somewhat at that time, but increasing again in the early fall, when certificate offerings were renewed. As the season for crop moving approached and the financing of the second Liberty loan began to be felt rates materially strengthened, and although banks seldom, charged their customers over 6 per cent, their borrowings from the Federal Eeserve Bank became heavier and more frequent. DISCOUNT OPERATIONS. During the first year and a half of operations of this bank rediscounts from member banks were small, never reaching during that time $500,000. During July, 1916, these reached a high point of $5,000,000, from which they quickly receded, and it was not until late in that year that they again expanded, this time to a high point of $10,000,000. During January of the present year, rediscounts again declined to just below $1,000,000 and fluctuations for the balance of the year are outlined in Schedule 4 appended. Early in June, 1917, with the approach of payments on the first Liberty loan, rediscounts expanded to a high point of $25,500,000. From this point they receded to a little over $14,000,000, fluctuating with an upward tendency until October, when they dropped to a low point of $10,800,000. With the approach of payment dates for the second Liberty loan there was a heavy demand for discounts from members, and through them from nonmembers. These, for the most part, were secured by Liberty loan bonds. The highest point for one day was reached on December 4, when on the eve of an increase in discount rates,1 the bank discounted or loaned on 1,280 items for about 60 banks something over $36,000,000. This compares with total rediscounts of $2,386,923 from 29 banks for the first 13| months of operation. In other words, the bank rediscounted about 15 times as large an amount in one day as during the entire first 13| months of operations to December 31, 1915. This brought the total loans to $101,000,000. 1 Member banks had been advised that they would be given 48 hours' notice of any change in the discount rates then existing. Digitized for FRASE3R43 65°—18 15 http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

220 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. On December 4, in order to strengthen the bank's reserve, there were sold from the bank's own portfolio to other Federal Reserve Banks $5,000,000 of acceptances, and on December 5 a further lot of $10,000,000. This brought the bank's loans on December 5 down to $91,000,000. With the financing incidental to the second Liberty loan and with the withdrawal of Government deposits from depositary banks, the demand on the Federal Reserve Bank from its member banks for accommodation became so heavy that during December, besides selling to the other Federal Reserve Banks bankers' acceptances referred to elsewhere, on December 11 rediscounts amounting to $20,000,000 secured by Liberty loan bonds were made with other Federal Reserve Banks and on December 18 a further rediscount of $25,000,000. TRADE ACCEPTANCES. The use of the trade acceptance has not broadened during the year and has been confined, as in previous years, largely in connection with the cotton industries. Money conditions were such last year that note brokers could sell trade acceptances in the open market, but banks have been out of the market for outside paper, especially during the period of the movement of cotton and, therefore, these acceptances have been bought by the Federal Reserve Bank, largely from country banks in mill centers and with such member banks' indorsement, and in increasing amounts toward the end of the year, as will be seen by Schedule 7. Few of the larger banks in the district have yet encouraged the trade acceptance, still, being in favor of the single name note and the discount system so long in vogue in this section. The rate on the trade acceptance maintained by the bank has been about one-half per cent lower than the rate on bills discounted. ACCEPTANCES. The acceptance business has shown marked growth during the year, the increased cost of raw material necessary for the industries of the district having influenced this form of financing. The development of foreign bills has been most satisfactory, imported wool, cotton, hides, and jute forming the principal merchandise thus financed. This method of financing has done much to develop banking relations between the United States, South America, and the Far East. The line of development of the domestic acceptance in this district, however, has not been so satisfactory. The fact that rates were maintained for bankers' acceptances by the Federal Reserve Bank below the ruling money rates and the unusual demands for capital which existed, especially in the financing of cotton and Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 1—BOSTON. 221 other raw material, induced banks to accept bills drawn rather for general financing purposes than for the transportation or carrying of merchandise. Some banks have at times accepted drafts simply to extend additional accommodation to customers who were already borrowing up to their legal limit, and acceptances have been made that were not in strict accordance with the tenets of the Federal Reserve Act and the regulations of the Federal Eeserve Board. It will be seen by reference to Schedule 6 that the investment of the Federal Eeserve Bank in acceptances has fluctuated widely during the year. In order to strengthen the bank's reserve these investments were allowed to run off early in the year so that in April, at the outbreak of the war, the bank held but $6,500,000. While the bank has maintained a policy of buying all eligible acceptances when offered and indorsed by its member banks, it has reduced such offerings by raising its purchase rate so as to send acceptances into the portfolios of other banks. As money rates increased, acceptances were offered more freely, and in October the bank had invested some $30,000,000 in these securities. The raising of the purchase rate has not always been effectual in reducing the volume of offerings of this character coming to the bank, for at times commercial banks were out of the market and other Federal Eeserve Banks were giving preference to the acceptances of members in their own district. While, during the development by the banks of this country of this new class of business, it may have been necessary and desirable for the reserve banks to maintain rates for bankers' acceptances much below the ruling local money rates in order to compete with foreign bankers, this has had the effect of limiting their market to the Federal Eeserve Bank and a few of the large city banks. Both from the buying and selling standpoint it would appear desirable to encourage a broader and freer market for bankers' acceptances. The Federal Eeserve Bank should not feel obliged to support the market for its member banks' acceptances or to restrict its purchases only to its member banks, and the purchase rate should follow more nearly those of similar high-grade short-time investments so as to attract banks throughout the country to cany bankers' acceptances in their portfolios as secondary reserve. Schedules 7 and 8 show the amount and character of these purchasings. Schedule 9 shows the acceptance liability of national banks in New England at date of comptroller's calls. UNITED STATES BONDS. Investments in United'States bonds and other Government securities by the Federal Eeserve Bank have not shown material increase during the year. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

222 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. On April 1, the bank purchased through the Secretary of the Treasury 1,057,750 United States 2 per cent bonds, its proportion of the bonds offered by member banks under section 18 of the Federal Reserve Act. One-half of these bonds and similar bonds already held by the bank were converted into one-year Treasury notes. Schedule 2 shows the bank's investments in Government securities on December 31, 1916, and December 31, 1917. MUNICIPAL, WARRANTS. Municipal warrants have been purchased by the bank only when discounts, bankers' accptances, and other short-time eligible securities wrere lacking. The increased use of bankers' acceptances and trade acceptances, and the demand for rediscounts from member banks has been so large that with the exception of $125,000 city of New York 3| notes, which matured on June 5, the Federal Reserve Bank has made no purchase of warrants. RESERVE POSITION. The reserve position of the Federal Reserve Bank has changed materially during the year. The gold holdings of the bank have increased, but on the other hand the percentage of reserve against deposits, with the greater activities of the bank, shows a decrease. The increase in the gold has been brought about through several causes: The changes in reserve requirements in the amendments to the Federal Reserve Act of June 21; the admission of State banks to membership; and the process of replacing with Federal Reserve notes gold and gold certificates'carried by State and national banks as till money, and, to some extent, the retention by the bank of gold in circulation. Under a ruling of the Federal Reserve Board, the Boston banks increased their reserve with the Federal Reserve Bank under the new requirements on June 27, the country banks being allowed to maintain their former reserve until July 15. The reserve position of the bank at weekly periods during the year will be found in Schedule 10, and the gold reserve on chart 10A. Schedule 19 showTs the reserve of national banks in New England at date of comptroller's calls. MOVEMENT OF MEMBERSHIP. Changes in the status of national banks in the district during the year, especially as to conversion into trust companies, have been less marked than in previous years, and only 13 member banks have sur- Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 1 BOSTON. 223 rendered their charters during the year. On the other hand, many of the larger State institutions have joined the system, and the position of this bank has been materially strengthened thereby. There are now 403 member banks in this district as against 399 at the end of 1916. The number of shares in the Federal Eeserve Bank surrendered by the withdrawal of membership during the year amounted to 2,295, as compared to 12,533 subscribed by new members. The details of these changes wTill be seen in Schedules 11, 12, and 13. RELATIONS WITH MEMBER BANKS. Activities in connection with subscriptions to Liberty loan bonds and the financing of such subscriptions, as w^ell as other Government requirements, have brought member banks into closer touch with the Federal Eeserve Bank. More banks have availed themselves of rediscount privileges and to a greater extent. The feeling of the country banker concerning membership in the Federal Eeserve system has shown a marked change during the year, and all banks are apparently coming to realize the advantages offered by the reserve system and the strength given them by membership. More banks have used the check-collection system and to a greater extent, but the charge of nine-tenths of a cent prevents banks from making general use of that facility, especially the country banks, which continue to send their checks largely to their city correspondents. The time-collection system and the transfer-check system have been used to but a limited extent as noted elsewhere in the report. Permission to act as trustee, etc., under section Ilk of the Federal Eeserve Act has been granted to the banks named in Schedule 16. The names of banks authorized during the year to accept up to an amount equal to 100 per cent of their capital and surplus will be found in Schedule 17. Schedule 14 shows the borrowings of national banks in New England at the time of the comptroller's calls. RELATIONS WITH STATE BANKS AND TRUST COMPANIES. During the past year the bank has also been brought into more intimate relations with the State banks of this district through governmental operations in connection with Liberty loan subscriptions and Government depositaries. In the handling of Liberty loan operations the officers of State and member banks took prominent parts. Both by redeposits of Government funds and rediscount assistance for carrying bonds, Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

224 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. State banks were given the same accommodation as member banks except that rediscounts made for State banks were made only through and with the indorsement of member banks. Under authority of the Federal Eeserve Act, the Federal Reserve Board ruled on May 15 that Federal Reserve Banks might rediscount for member banks notes of State banks issued for carrying Liberty loan bonds and while this permission was granted only for the period from June 15 to July 15, the time was extended throughout the year. As the war progressed, State banks began to be more often called upon to finance customers engaged on Government work and such banks began to appreciate the advantages offered by the Federal Reserve Bank to member banks through rediscounts. This, together with amendments to the Federal Reserve Act of June 21, 1917, wxhich were particularly favorable to State institutions, influenced a number of State banks to apply for membership in the Federal Reserve system. It was not, however, until after the appeal of the President of the United States, on October 13, that State banks began to any great extent to apply for membership, banks applying after that date stating that they were doing so largely for patriotic reasons. Relations between the officers of the Federal Reserve Bank and those of the State institutions have been most friendly and cordial, and during the year State institutions offered to the reserve bank their gold holdings in exchange for Federal Reserve notes in order to strengthen the gold reserve of the Federal Reserve system. The admission of these State banks to membership has given additional strength to the reserve system, as the applications of banks have been approved by the reserve bank's committee only when their condition after careful examination demonstrated that their admission would add strength to the system. The list of State banks admitted during the year and their deposits on admittance will be seen by Schedule 13. There are also some 10 or mere State banks whose applications for membership are pending. In connection with the examination of the applying State banks, the cooperation of the bank departments of the different States has been most helpful. The special committee of the American Bankers' Association has also been of value in influencing several of the State banks to apply for membership. Under the laws of several of the States of the district, savings accounts are required to be segregated and invested in savings banks' securities, and are subject to no reserve requirements. As a number of the State banks of the district have built up savings departments of considerable size and the reserve requirements of the Federal Reserve Act require that 3 per cent reserve be carried against savings de- Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. l—BOSTON. 225 posits, this has deterred a number of State banks from applying for membership, as have also to some extent, the requirements of section 5 22 of that act. While the laws of all of the States in the district allow State banks to join the Federal Reserve system, still in several of the States the laws are such that State banks that have been admitted to the reserve system can not take advantage of the reserve requirements and are obliged to carry such reserves as their State laws specify, which has the effect of increasing the reserve which those banks are required to maintain. Schedule 15 contains figures regarding eligible nonmember banks. POLICY IX REGARD TO RATES OX REDISCOUNTS AXD PURCHASES OF ACCEPTANCES. Government necessities have been an important factor in deciding the discount policy of the Federal Reserve Bank from the time of the declaration of war. Early in the year, at the suggestion of the Federal Reserve Board, this bank, together with other Federal Reserve Banks, raised its open-market rates on bankers' acceptances above the outside rate, and as these securities constituted one of the principal investments of the reserve bank, acceptances coming upon the market were purchased by member banks for their portfolios. The volume of the investment of these securities held by the bank was thereby materially reduced and the reserve of the bank was considerably strengthened. On April 6, 1917, at the outbreak of the war, its reserve was 76 per cent. During the subscription period of the first Liberty loan, it became necessary to establish a rate to carry Liberty loan bonds, and the directors of the Federal Reserve Bank were for the first time confronted with the question what effect would be produced by Government needs on what might be called the strictly commercial requirements of the district. While, under normal conditions, a rate somewhat higher than the Government loan yielded would have been deemed proper, the directors finally decided that such a rate might interfere with subscriptions to the Government bond issue, and, therefore, decided to establish a 3| per cent rate both on the 15-day and 90-day notes secured by Liberty loan bonds. Outside of the marking up of the rate on trade acceptances from 8| per cent to 4- per cent on June 26,1917, no other changes were made in the discount rate until August, when the acceptance rate was advanced. At that time it was felt that all rates might properly be moved up, for after the payments on account of Liberty loan subscriptions made on August 15, the banks in the district began to feel the drain caused by these payments, and discounts at the reserve banks became more frequent. It was felt, however, that the raising of Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

226 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. the discount rate at that time might interfere with the sale by the Secretary of the Treasury of the United States of the certificates of indebtedness which were soon to be forthcoming in connection with the second Liberty loan, especially as the act of Congress prevented the Secretary of the Treasury from issuing such certificates at a rate higher than 3J per cent. From this period on, certain of the member banks began to run up their lines of discount, these banks having demands on them not only for subscriptions to Liberty loan bonds^ but also from customers working on Government contracts. In order, however, to protect the reserve of the bank, the rates for bankers' acceptances were steadily increased until they wrere about one-half per cent above the rate established by the New York Federal Reserve Bank, thereby sending those created in this market largely to the New York bank. Although it was suggested to these member banks that they endeavor to liquidate their rediscounts, it wTas finally decided that nothing should be done to interfere with Government needs, and liquidation in nonessential industries should be encouraged. If liquidation in the nonessential industries were to take place, it was decided that such liquidation could be safely accomplished only through some indirect influence coming from the Government itself and that banks should be encouraged to expand in financing Government orders and in placing the different Government loans. After Congress met in September and had given the Secretary of the Treasury the discretion as to rates on Government borrowings, the directors of the reserve bank felt freer to establish rates based on prevailing local conditions. With the inauguration of the second Liberty loan the same question as to the policy of establishing a rate for carrying these 4 per cent bonds came up for consideration. It was deemed inadvisable to make any change in the previous rate of 3| per cent, either for 15-day loans to banks secured by Liberty loan bonds or for 90-day loans to individuals so secured, and other rates were not raised. Here again it was found necessary to stimulate subscriptions to Government bonds. With the withdrawal of Government deposits in December, banks, as in July, began to feel the strain and the contraction of the money market again brought the banks to the Federal Reserve Bank for rediscounts. This time it was decided to raise the rates in order to encourage some liquidation, and new rates were accordingly put into effect on December 5 and again on December 12, as shown by Schedule 18. CREDIT DEPARTMENT. During the year the credit department, under the supervision of the Federal Reserve agent, began giving more attention to the state- Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 1—BOSTON. 227 ments of borrowers from member banks when their notes were offered for rediscount, especially from the viewpoint of eligibility. A policy was adopted of requiring banks to furnish statements of the makers of notes offered, whenever notes were for $5,000 and over. This policy was adopted with the idea of influencing member banks to extend their credit departments and to give more attention to the character of notes offered. DEPOSITS. There are appended Schedules 20, 21, and 22, showing the fluctua-1 tion of member bank deposits, United States Government deposits (general account), and United States funds deposited by the bank as fiscal agents with designated depositaries. Member bank deposits, as will be seen by Schedule 20, showed a" very material increase, expanding from a low point of about $43,000,000 early in the year to a high point of nearly $118,000,000 on November 15. This high point, however, was maintained only for a few days for use in payments to be made on the second Liberty loan. Most of the increase in deposits is due to the new reserve requirements of the Federal Eeserve Act as amended in June, 1917, and to the deposits of State banks admitted to membership. Schedule 20 shows the trend of deposits during the year. While the policy of penalizing banks deficient in reserves has been continued, the number of banks so penalized has been comparatively; small. Government deposits are dealt with later in the report. PERIODIC REPORTS REGARDING MEMBER BANKS. Reports of national bank examinations are received regularly, as in previous years, from the chief bank examiner, and similar reports have been placed at the disposal of the Federal Eeserve Bank by the bank commissioners of examinations made by them of State banks admitted to membership. These reports have been of great value to the officers in giving them an intimate knowledge of the financial conditions of member banks. Beginning December 7, weekly reports are being received from member banks in Boston and Springfield, Mass.; Hartford, Conn.; Providence, K. I., and New Haven, Conn., these reports being similar in character to those which the different clearing houses have re- {€ uired of their member banks. These reports should prove of great value in keeping the bank officials in touch with the financial conditions of the district. EDUCATIONAL AND PUBLICITY WORK. While the officers of the bank have addressed bankers' meetings and trade organizations, the educational and publicity work has Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

228 ANNUAL EEPOET OF THE FEDERAL RESERVE BOARD. been confined largely to matters pertaining to the Liberty loans and to inducing the State institutions to- join the Federal Reserve system. The close intercourse of the officials of the bank in connection with governmental operations has furnished an opportunity for personal contact, both with the banker and business man, which has been most beneficial. Copies of speeches made by officers of the reserve system and prominent bankers dealing with the different phases of the Federal Reserve Act have been sent from time to timethroughout the district. Banks, and the public in general, have come to appreciate the power of the Federal Reserve system, especially in connection with the financing of the Government loans. The fact that these loans have been financed, as well as the largely increased Government orders, without any undue disturbance in the money market, has done much to impress all thinking banking officials and business men of the potential strength of the reserve bank and the system as a whole. GOVERNMENT DEPOSITS. The deposits of the Government, both in the Federal Reserve Bank and with depositary banks has been of unusual magnitude and activity during the year, as will be seen by Schedules 21 and 22. The Government purchases of ammunition and other war supplies manufactured in the district and the receipts and transfers on account of Liberty loan bonds, has made this bank's position as fiscal agent a most important one. Acting under permission given in Treasury Department Circular No. 81, 245 banks qualified as Government depositaries in connection with the first Liberty loan and payments were made by credit and redeposits amounting to about $82,000,000. In connection with the second Liberty loan, 209 banks so qualified and payments by credit in connection with the November 15 payment amounted to over $170,000,000. The securities offered as collateral against these deposits were approved by a committee consisting of Mr. Charles A. Morss, class B director of the bank, as chairman; Mr. A. L. Aiken, governor of the bank; Mr. F. H. Curtiss, Federal Reserve agent, Mr. J. H. Leman, of Merrill, Oldham & Co., bankers; and Mr. G. P. Fogg, of R. L. Day & Co., bankers. In connection with deposits of securities made against the first Liberty loan payments, several of the larger Boston banks and certain of the Connecticut banks acted as custodians of collateral. Securities pledged in connection with the second Liberty loan were all held by the Federal Reserve Bank of Boston as custodian with the exception of banks in New Haven, Hartford, and Waterbury, Conn., when local banks acted in that capacity. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

AOTTJAL REPORT OF THE FEDERAL RESERVE BOARD. 229 CERTIFICATES OF INDEBTEDNESS. The financing of Liberty loan subscriptions and tax payments by purchase of certificates of indebtedness issued from time to time by the Treasury Department has been of great value in relieving the pressure that would otherwise have been felt in the money market of the district through the withdrawal at one time of the large sums of money involved. The banks and the larger business houses have appreciated the advantage of the method of financing and have subscribed liberally as each issue of certificates of indebtedness has been offered. Schedules 23 and 24 show in detail the amount of these securities subscribed through the Federal Eeserve Bank of Boston and other data of interest. Redeposits were made with qualified depositary banks in connec-1 tion with each issue of certificates of indebtedness, in a similar man-'; ner as with Liberty loan subscriptions, the deposits being gradually withdrawn by the Government as needs required. The payments by credit in connection with the certificates of indebtedness are included in the figures shown in Schedule 22. LIBERTY LOANS. Immediately following the announcement by the Secretary of the Treasury of the initial offering of the first Liberty loan, a meeting of the executive committee of this bank was held to consider the organization of a Liberty loan committee to distribute and handle all details pertaining to the proposed issue of bonds. Representatives from the more important bond houses were asked to meet and assist in perfecting an organization to handle the necessary details pertaining to the bond issue. An organization was laid out covering New England with the exception of Fairfield County, Conn. The organization for both the first and second loans was practically the same. Special mention should be made of the important part taken by the Boston bankers and brokers to whom is largely due the great success of the distributing end of both Liberty loans. The central committee was representative of the local financial interests and from that the executive committee was chosen. The headquarters of the executive committee were at 50 State Street, in rooms provided by Lee, Iligginsoii & Co. The Federal Reserve Bank has since leased permanent quarters at 30 Kilby Street for the Liberty loan committee. In Boston some 79 committees representing the different lines of trade were formed. In each of the banking centers throughout the district local chairmen were chosen, for the most part prominent bankers, and each heading committees representative of the locality. There were 69 such committees in Maine, 47 in New Hampshire, 146 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

230 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. in Massachusetts, 51 in Vermont, 11 iri Rhode Island, and 61 in Connecticut. The governors and treasurers of the different States, the mayors of the cities and other public officials, public-safety committees, labor organizations, all have assisted in making the Liberty loans a success. On the first Liberty loan, the minimum allotment for this district was $240,000,000, the maximum being $300,000,000. Subscriptions of $332,44:7,000 were received and allotments were made of $265,017,900. On the second Liberty loan the minimum allotment was $300,000,000, the maximum being $500,000,000, and subscriptions were received of $476,950,050. Allotments were made of $407,713,700. The basis of the maximum and minimum allotment on the first loan was on the total banking resources of the district, which included savings banks. On the second loan the allotment was on a similar basis, with the exception that but 50 per cent of the savings banks' resources were included. Full details in reference to the allotments and subscriptions by States will be seen by referring to Schedule 25. Schedules 26, 27, and 27A give further details in reference to payments made and various other matters relating to these two bond issues. WAR-SAVINGS CERTIFICATES. In connection with the handling of the war-savings certificates campaign, the Federal Reserve Bank has not taken the same active part as it has in sales of Liberty loan bonds. The war-savings certificates campaign has been handled by an organization headed by Federal appointees and has been entirely apart from the direction and guidance of the Federal Eeserve Bank. This bank has acted only as custodian of the certificates and stamps, delivering those securities on the instructions of the committee. FEDERAL RESERVE NOTE ISSUES. During the year, as will be seen by Schedule 28, an increasing amount of Federal Eeserve notes has been issued each month. This has been brought about by two influences; first, by the nonissuance of gold certificates of $10 and $20 denominations by the Treasury Department, and, second, by the efforts of the Federal Eeserve Bank to strengthen its reserve position through the acquiring of gold held in the tills of member banks and in the pockets of the public, issuing in place thereof Federal Eeserve notes. Banks in this district, both member and nonmember, have responded very willingly to this bank's suggestions that they do not pay out gold certificates but retain them, exchanging them for Federal Eeserve notes. As the demand for Federal Eeserve notes increased, it was found advisable to carry a larger supply on hand not only in our own vaults, Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 1 BOSTON. 231 but in the subtreasury and with the Comptroller of the Currency at Washington. At the present time there is available $106,700,000 of such notes, a large part of which can be used at once and the balance within 24 hours. Schedule 30 appended shows the amount of Federal Eeserve notes of this bank returned to us by the other Federal Beserve Banks and the amounts of notes outside the district returned to issuing banks by us. Schedules 28 and 29 show Federal Eeserve notes issued and retired by the bank during the year. While the Federal Eeserve Bank has furnished currency through the issue of Federal Eeserve notes to a considerable extent, the bank should have facilities for furnishing currency of all denominations and kinds. The demand for pay-roll needs, with the increased activities in industry, has been felt increasingly during the year. INTERNAL ORGANIZATION. During the year there have been held 25 directors' meetings with an average attendance of 8 members. The executive committee has met 30 times and the average attendance has been 4. At an early meeting of the board of directors, Mr. Daniel G. Wing, president of the First National Bank of Boston, was reelected a member of the Federal Advisory Council. The terms of Thomas P. Beal, class A director, and Charles A. Morss, class B director, expired December 31, 1917. A new election was held by member banks in group 1, who were represented by these directors and they were unanimously reelected, there being no other nominations made for the offices. Mr. Frederic H. Curtiss was reappointed by the Federal Eeserve Board as a director of the Federal Eeserve Bank of Boston for three years ending December 31, 1920. He was redesignated as chairman and Federal Eeserve agent. Owing to the death of Mr. Walter S. Hackney on March 20, 1917, who had been the class C director and vice chairman since October, 1914, Mr. Andrew J. Peters, former Assistant Secretary of the Treasury, was appointed by the Federal Eeserve Board to fill the vacancy caused by Mr. Hackney's death. Mr. Alfred L. Aiken, who had been governor of the Federal Eeserve Bank since November, 1914, resigned to accept the presidency of the National Shawmut Bank of Boston. Mr. Charles A. Morss, formerly treasurer of the Simplex Wire & Cable Co. of Boston, a class B director of the bank, was elected to the position of governor, taking office on December 20, 1917. Mr. Morss has been a close student of finance for many years, and has been connected as director with several of the large local banks. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

232 ANNUAL BEPOET OF THE FEDERAL RESERVE BOARD. Mr. Florrimon M. Howe, who has been cashier of the bank since November, 1914, resigned in December to accept the vice presidency of the Industrial Trust Co. of Providence, R. I., and Mr. Chester C. Biillen, formerly assistant cashier, was elected cashier. The organization of the Federal Keserve Bank, both from the executive and the clerical staff, has had to be largely increased during the year, owing to the additional activities of the reserve bank in connection with its position' as fiscal agent for the United States Government. At the time of the first Liberty loan, the subscription department and bond department was handled largely by volunteer forces, wTho were liberally contributed by the local banking houses. It was deemed necessary, however, to establish in the bank a permanent organization to handle the details incidental to the second Liberty loan and for the handling of future Government loans. A new plan of reorganization of the entire bank was laid out. This new plan of reorganization led to the election of Mr. William Wiliett, former assistant auditor of the bank, as assistant cashier in charge of the clearing department. Mr. Harry A. Saunders, formerly head bookkeeper, was appointed assistant cashier and put in charge of the subscription department. Mr. Chester C. Bullen, assistant cashier, being put in charge of the entire bond department. Mr. Harry F. Currier, former national bank examiner, was appointed chief auditor. With the approval of the Federal Reserve Board, Mr. Russell B. Spear was selected by the Federal Reserve agent as assistant Federal Reserve agent, as provided in the recent amendment of the Federal Reserve Act, and, pending the organization of a special department, the handling of the certificates of indebtedness, Government depositaries, and securities deposited by banks against Government funds, has been carried on in the Federal Reserve agent's department. With the increase of the bank's activities, the greatest problem has been the inadequacy of its present banking quarters, and although considerable more floor space has been added during the year and the clerical force increased from 70 to 256, still it is most important that larger banking quarters be secured and this force materially increased. A committee of the directors has this matter under consideration. CLEARINGS AND COLLECTIONS. During the year the check collection department continued to expand with an increasing number of banks sending their checks to the bank for collection. About 25 banks, having a large number of items on points in other Federal Reserve districts, have taken advantage of the direct routing feature of this system and send their Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 1 BOSTON. 233 items direct to other Federal Eeserve Banks. About 83 banks in other districts are sending items direct to this bank. The charge for collecting remains the same at nine-tenths of a cent per item. ? It is noticeable that some banks are sending only their larger items, their smaller ones going through their city correspondents. In spite of the increase in items handled, it has only been necessary to make a slight increase in the number of clerks. A comparison of figures with other Federal Eeserve Banks shows a very much larger percentage of checks outside of the Federal Keserve city handled in this district than in any other. This is due to a considerable extent to the fact that the New England banks were practically all accustomed to remit to the Boston Clearing House before the establishment of the present collection system. Schedules 31 and 32 contain detailed statistics on the activities of this department. GOLD-SETTLEMENT FUND. The gold-settlement fund, the operation of which was outlined in the report of 1915, has continued to become an increasingly important factor in the settlement of exchange without actual transfer of funds from one Federal Reserve Bank to another. During the year the transfers through this fund were largely increased, as will be seen from Schedule 33. The cost of making these transfers is infinitesimal in comparison with the vast total of transfers made. Late in the year the Boston subtreasury began settling its balances by transfers on the books of this bank instead of by the actual exchange of currency, and this has added to the volume of transfers through this fund. BANK OF ENGLAND STERLING GOLD ACCOUNT. Following an arrangement made between the Federal Eeserve Bank of New York and the Bank of England establishing relations as correspondents in which all the Federal Eeserve Banks might participate, this bank made payment in New York for account of the Bank of England on June 7, 1917, of $3,675,000 in gold, the Bank of England setting aside and holding a similar amount in "earmarked gold " in London subject to this bank's orders. CONCLUSION. There is no better evidence of the important position that the Federal Eeserve Bank of Boston has attained at the present time than a survey of the balance sheet shown in schedule 2. The bank has been tested during the present year in the financing of the great war loans and increased activities of the local industries Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

234 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. to such an extent that its policy of discount is closely watched, and its officials are called into consultation whenever any new problem arises, which frequently occurs, owing to war conditions. In outlining the bank policy due regard has been taken of the different interests affected and from the broadest national viewpoint. That the war financing has been accomplished without undue disturbance to the local money market has impressed not only the banks but the public at large of the power, strength, and insurance which the Federal Reserve Bank of Boston and the Federal Reserve system furnishes for the handling of commerce and business of the United States. SCHEDULE 1.—Income and expense. Expense. 1916 1917 Income. 1916 1917 Paid in lieu of dividends Balance January 1, 1917... $11,596.56 on stock canceled $2,804.17 $3,926.85 Current expense 25,357.37 51,288.75 Discount from member Directors7 fees 5,712.35 5,781.10 banks on— Rent 15,139.13 15,246. 49 Notes discounted $39,641.83 302,612.23 Salaries 77,085.38 93,193. 65 Rediscounts secured Exchange paid .40 69.10 by United States Cost of Federal Reserve bonds. 153,039.85 notes 15,141.36 08,954.48 Assessment for expense, Federal Reserve Board.. 17,703.57 21,226.35 Collateral notes 2,153.23 87,962.26 Charged off: Trade acceptances 1,508.14 27,502.79 Organization 17,301.73 Furniture and equip- 43,303.20 571,117.13 ment 15,352.04 8,973.83 Difference account.... 88.98 814. 83 Discount on open-market Cost of unissued cur- purchases: 33,666.91 Bankers' acceptances, Repairs and altera- domestic 7,709.16 107,831.44 10,450.00 Bankers' acceptances, Expenses paid in- foreign 229,147.58 377,903.14 1,462.24 Trade acceptances, Transit department, foreign . . .. 16,662.72 8,255.87 State, city, and town notes 78,578.27 5,202.73 315,435.01 507,600.03 Interest on United States securities 57,194.16 94,784.86 Appreciation and profit on United States securities.. 20,575.00 11,101.60 77,769.16 105,888.46 Commissions 10,558.55 6,938.15 Penalties for deficient 6,105.39 Service charges To balance 258,527.42 886,294.79 Sundry profits 3,147.98 361.52 450,213.90 1,209,605. 24 450,213. 90 1,209,605.24 1917 1918 1917 1918 Dividends paid member banks 246,930.86 597,828.54 Jan. 2, balance forward... 258,527.42 886,294.79 Reserve for depreciation on United States securi- 138,260.25 Balance to surplus account including payment to United States Govern- 11,596.56 150,200.00 258,527. 42 886,294. 79 258,527.42 886,294.79 Jan. 3, balance 11, 596. 56 150,200.00 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 1 BOSTON. 235 SCHEDULE 2.—Comparative balance sheet Dec. 31, 1016, and Dee. 31, 1917. Dec. 31,1916. Dec. 31,1917. RESOURCES. Earning assets: Bills discounted for member banks $3,745,315.28 $65, 882,359.35 Acceptances purchased 12,725,167.81 037,506.04 State, city, and town notes 890,002.23 United States bonds 1,332,000.00 609, 750. 00 United States 1-year Treasury notes— 1,000,000.00 \, 194,000.00 $19,692,485.32 • $77,723,615.39 Reserve cash: Gold coin and gold certificates 11,774,857.50 690,900.00 Gold settlement fund 14,737,000.00 977,000.00 Gold redemption fund for Federal Reserve notes 000,000.00 Bank of England sterling gold account.. 675,000.00 Other lawful money 427,683.00 574,566.00 26,939,540.50 44,917,466.00 With Federal Reserve agent: Gold against Federal Reserve notes 113,518,385.00 40,896,820.00 Other resources: Interest accrued on United States bonds 13,870.83 21,958.75 Check collection expense (recoverable).. 8,384.44 Expense Liberty loan (recoverable) i44,'i67.62 Expenses paid in advance 1.564.72 Cost of FederalReserve notes (unissued) 29,230.20 Due from Liberty loan subscriptions... 118,035.40 Due from Federal Reserve Banks 4,836,131.06 Items in process of collection 12,592,167.39 "*i5,'667,*383*44 Due from banks (Government deposits) 66,489,691.55 Exchanges for clearing house and cash items 328,149.59 3,216,597.70 Federal Reserve notes and other cash on hand 815,595.87 4,661,035.81 Total assets. 65,257,119.92 253,196,771.66 LIABILITIES. Capital fund: Capital paid in 4,989,700.00 5,858,450.00 Surplus Profit and loss account 258,'527.*42" Deposits: Due to member banks reserve account.. 56,757,135.68 82,842,197.76 Due to Federal Reserve Banks collected funds 3,870,139.46 Due to banks uncollected funds 1,058,988.16 13,780,544.93 Duo to United States Government general account 2,130,617.72 2,419,414.94 Due to United States special account... 66,489,691.55 Cashier's checks outstanding 941.30 20,416.38 Federal Reserve notes outstanding i 13,518,385.00 Other liabilities: 77,296,820.00 Unearned discount and interest 61,209.64 468,896.64 Total liabilities.. 65,257,119.92 253,196,771.66 Liability for rediscount with other Federal Reserve Banks 44,477,789.09 i These items not included in total. 34365° Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

236 ANNUAL, REPORT OF THE FEDERAL RESERVE BOARD. SCHEDULE 3.—Money rates in Boston, 1917. Jan. Feb. Mar. Apr. May. June. C D o e m m m an e d rc m ia o l n p e a y per 3 3 r - 4 6 ! 3 3- 4 -4 1 4 3 4 ^ - - 4 4 4 4 4 1 - - 5 0 4 5 H -6 C A Y B T e o c r e r o w c a t k e r i n f p e i m c t r n a s a o o n ' t n e t 6 c e e s e s m y s o . o f n in th d s e ' b p t a e p d e n r e s . s .. .. 1.0 4 0 f- -3 4| .230 2.0 3 4 9 i H - - 4 2 f .70 1.4 2 4 44 6 4 - - - - 4 3 5 4 1 4 .00 3-5 2 4 4 1 0 J J - - - - 3 5 5 4 4 .12 11 3 3 7 - - - 5 3 3 4 * | .55 4.2 3 5 1 - - -5 3 6 5 . J 39 2 i July. Aug. Sept. Oct. Nov. Dec. Demand money 44-6 44-5 44-6 4 -6 4 -6 44-6 Commercial paper 44-5i 4f-5i 5-6 54-6 5|-6 Brokers' 6 months' paper... 4f-5i 5-54 5 -6 5|-6 Year money 5|5 5J-54 5 -5| 6 Acceptances 3-4 3|-4 3f-4 Town notes 3.92-4.39 3.98-4.93 4.27-4.34 4.24-4.J 4.55-4.90 4.58-5.10 Certificates of indebtedness. 31 34-4 4 4 4 SCHEDULE 4.—Bills discounted, including member banks' collateral notes held at close of business each Friday. In Millions '100 90 IS 80 \ 70 60 50 I 1 40 30 Ah 20 A / / 10 / J 0 Jan. Feb. Mar. Apr. May June July Aug. Sept Oct Nov. Dec. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT JSTO. 1 BOSTON. 287 SCHEDULE 5.—Total investments at close of business each Friday. 100 100 ft 90 90 BO I 80 >' V 70 70, €0 60 50 50 A .40 / 40 \ \/ V A / 30 30 / 20 20 /N s ^ / V 10 10 0 Jan. Feb. Mar. Apr. May June July Aug. Sept. Oct. Nov. Dec. SCHEDULE 6.—Amount of acceptances held at close of business each Friday. In Millions 35 35 30 30 25 25 1 ) 20 20 A / \J \ 15 / W V 10 \ / \ 5 0 Jar?. Fed, Mar., Apr. May June July Aug. Sept Oct. Nov. Dec.; Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

238 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. SCHEDULE 7.—Acceptances purchased for own account. Foreign acceptances. Domestic acceptances. Foreign trade acceptances. Month. Low Low Low and and and Items. Amount. high Items. Amount. high Items. Amount. high rate. rate. rate. P.ct. P.ct. January 90 $2,522,546.66 20 $516,292.67 February.. 187 4,461,805.32 2i-34 19 800,416.62 March 163 4,803,854.46 24-34 353,407.60 April 17 786,937.47 2^-34 280 458,149.37 May 233 9,077,342.66 38-34 57 1,140,471.04 June 185 6,153,140.45 3 -34 70 2,390,740.88 July 67 2,300,664.79 3-34 22 1,102,781.58 August 228 6,068,80S. 44 3 -31 49 1,253,165.94 24 $229,553.16 4-4 September.. 409 10,654,363.60 3i-4 102 3,958,850.87 101 2,020,406.37 4-4 October 97 4,179,893.80 31-4 54 1,400,099.76 8 60,733.74 4-4 November.. 373 7,831,447.47 31-31 79 3,505,018.51 50 499,881.92 4-4 December.. 123 3,891,621.91 31-41- 266 8,508,144.61 45 597,664.73 4-4 Total.. 2,172 62,732,427.03 766 25,387,539.45 228 3,408,239.92 SCHEDULE 8.—Acceptances purchased for oilier Federal Reserve Banks. Foreign acceptances. Domestic acceptances. Month. Low and Low and Items. Amount. high rate. Items. Amount. high rate. Per cent. February.. 252 $6,207,883.16 15 $326,327.40 April....... 124 3,597,019.89 30 1,005,828.17 Ill May 255 6,392,551.36 44 1,337,453.16 June 118 5,845,222.26 32 658.055.21 3 -3f July 8 686,000.00 10 307.853.22 3 -3? August 281 9,854,040.11 19 735.022.75 September. 78 3,244,386.64 4 173.805.76 3-3| November. 211 3,88i:947.48 13 447,560.70 3f-3f December.. 584 10,856:513.55 289 10,514,551.63 31-41 Total, 1,911 50,555,564.45 456 15,506,458.00 SCHEDULE 9.—Acceptance liability of national banks in New England at date of Comptroller's calls. Mar. 5, 1917 $24, 372, 000 May 1, 1917 25,459,000 June 20, 1917 33,147, 000 Sept. 11, 1917 35, 082, 000 Nov. 20, 1917 - 44, 500, 000 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 1 BOSTON. 239 SCHEDULE 10.—Cash reserve at close of business each Friday. PerCenr. 90 60 A 60 50 Jan. Fed. Mar. Apr. May June July /lay. Sept Oct. Nov. Dec. SCHEDULE 10A.—Total gold reserve at close of business each Friday. Mi/lions 110 no <nalf "ansfet*Nafi ?na/ilanfc Fuvgserv?stoF^derat ^i/e Bat 100 100 . I 90 A 90 / 80 J/ \ 80 A \ A 1 / / A I 70 \ 70 \ \ / ./ 60 u \ / 60 / VA / 50 / 50 1 ••/~N A 40 40 '\A t—A 30 /\ nl M 1 30 I \ 2 \, 20 20 l —Inch des Gold'w renf v 2- Goldheldby Bar It 10 10 3- Gold v\/Y/r AclentandBi.'nkeqvali'ztd,Act 0 Jan. Feb. Man Apr. May June July Aug. Sept Oct. Nov. Dec. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

240 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. SCHEDULE 11.—Member banks liquidated during 19.17. Shares Name of bank. Location. Disposition. surrendered. H H a o d m le e y N F a a ti l o ls n a N l a B ti a o n n k al Bank... Holyoke, Mass / \ F o y r o m k e e d , M H a a s d s l . ey Falls Trust Co., Hol- 2 1 1 8 0 0 Second National Bank Bangor, Me Consolidated .with Merrill Trust Co., 180 Bangor, Me. Ware National Bank Ware, Mass Succeeded by Ware Trust Co 234 Worcester National Bank Worcester, Mass... Co T n r s u o s li t d C at o e . d with Worcester Bank & 480 First National Bank Auburn, Me Succeeded by First Auburn Trust Co. 135 Brooks National Bank Torrington, Conn. Succeeded by Brooks Bank & Trust Co. 75 Taunton National Bank. Taunton, Mass Succeeded by Bristol County Trust 465 Co. Stoneharo. National Bank Stoneham, Mass Succeeded by Stoneham Trust Co 36 Rochester National Bank Rochester, N. H Succeeded by Rochester Trust Co 60 First National Bank Wiscasset, Me Succeeded by Lincoln County Trust 36 Co. Norwood National Bank Norwood, Mass Succeeded by Norwood Trust Co 120 South Berwick National Bank. South Berwick, Me.. Succeeded by South Berwick Savings 84 Bank & Trust Co. Total. 2,295 "I SCHEDULE 12.—New members. Name of bank. Location. Shares subscribed North Brookfield National Bank North Brookfield, Mass 38 Back Bay National Bank Boston, Mass 150 Tanners National Bank Woburn, Mass 68 Second National Bank Maiden, Mass 75 Commonwealth Trust Co Boston, Mass . . 900 Winchester Trust Co Winchester, Mass International Trust Co Boston, Mass 1,800 Fitchburg Bank & Trust Co Fitchburg, Mass 450 Norwood Trust Co. Norwood, Mass 120 American Trust Co Boston, Mass 1,800 Newton Trust Co Newton, Mass 480 Industrial Trust Co Providence, R.I 4,200 Metropolitan Trust Co Boston, Mass 360 Union & New Haven Trust Co New Haven, Conn 690 Charles River Trust Co Cambridge, Mass 240 Winchester National Bank Winchester, Mass.... 39 Worcester Bank & Trust Co Worcester, Mass 1,050 Total 12,533 SCHEDULE 13.—State banks admitted to system. Date of Capital Deposits admis- Name of bank. Location. and when sion. surplus. admitted. 1917. Feb. 12 Commonwealth Trust Co Boston, Mass 500,000 $18,520,000 May 29 Winchester Trust Co Winchester, Mass 125,000 530,000 June 9 International Trust Co Boston, Mass 000,000 14,772,000 July 26 Fitchburg Bank & Trust Co*.. Fitchburg, Mass 750,000 3,485,000 Aug. 11 Norwood Trust Co Norwood, Mass 200,000 1,771 000 31 American Trust Co Boston, Mass 000,000 19,905,000 Nov. 5 Newton Trust Co Newton, Mass 800,000 3,629,000 9 Industrial Trust Co Providence, R. I 000,000 58,765,000 Dec 4 Metropolitan Trust Co , Boston, Mass 600,000 3,559,000 11 Charles River Trust Co Cambridge, Mass 400,000 1,881,000 14 Union & New Haven Trust Co. New Haven, Conn 150,000 3,156,000 Worcester Bank & Trust Co.... Worcester, Mass 750,000 19,790,000 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 1 BOSTON. 241 SCHEDULE 14.—Borrowings of national banks in Neiv England. Date. p F r b e a w B e a s y d e i n i a l e t r l k b h r v s a l . e 1 e l e b l M o se rr o w o n w h e e y e r d e.re L d i i a sc b fo o il r u it n ie ts s .1 borr T o o w ta in l gs.1 an i b n A c i c n i o o c e n c r l u s g c u r n o e s t d r o t w e p . e e 1 d t t d d - a - is l - o c f R F o R B B e u e e d s a n o d e e n s t i r s r t k s v o a - o e l n f .2 Dec. 27,1916. $610,000 $4,633,000 $14,547,000 $19,790,000 $8,849,000 $4,804,000 Mar. 5,1917.. 110,000 3,089,000 16,299,000 19,498,000 8,733,000 2,535,000 May 1,1917... 1,740,000 3,077,000 13,098,000 17,915,000 6,951,000 4,791,000 June 20,1917. 7,445,000 8,131,000 21,376,000 36,952,000 6,654,000 15,693,000 Sept. 11,1917. 5,177,000 6,124,000 15,883,000 27,184,000 5,738,000 13,757,000 Nov. 20,1917. 5,439,000 6,701,000 45,479,000 57,619,000 15,496,000 32,970,000 1 From reports to Comptroller of the Currency. 2 As shown by books of Federal Reserve Bank of Boston. SCHEDULE 15.—Number, capital, and surplus, and deposits, by States, of eligible nonmember banks. Number Capital and State. banks. surplus. Deposits. Connecticut - . . 25 $9,904,300 $56,828,000 Maine 37 6,347,900 59,498,000 Massachusetts 80 40,164,000 269,846,000 New Hampshire . . .. 8 1,500,200 8,970,254 Rhode Island 10 18,378,000 154,161,000 Vermont. . .. 23 2,756,000 30,836,000 Total 183 79,050,400 580,139,254 SCHEDULE 16.—Banks granted fiduciary powers under section Ilk of the Federal reserve act. Date. Name. Location. Powers granted, 1917 Jan. 29 Merrimack National Bank Haverhill, Mass . Trustee, executor, administrator, and registrar of stocks and bonds. 29 First National Bank Bar Harbor, Me.... Do. Mar. 16 Home National Bank Brockton, Mass Do. May 14 State National Bank Windsor, Vt Trustee, executor, and administrator. June 18 Webster& Atlas Nat ional Bank. Boston, Mass . Trustee, executor, administrator and registrar of stocks and bonds. Aug. 20 Manufacturers National Bank.. Lynn, Mass Do. 20 Edgartown National Bank Edgartown, Mass... Trustee, executor, and administrator. Oct. 31 National Bank of Wareham Wareham, Mass . Trustee, executor, administrator, and registrar of stocks and bonds. 31 Mechanics National Bank Worcester, Mass Do. Nov. 5 National State Capital Bank.... Concord, N. H Do. 10 Plymouth National Bank Plymouth, Mass... Do. 14 Vermont National Bank Brattleboro, Vt Do. Dec. 28 Merchants National Bank Leominster, Mass.. Do. SCHEDULE 17.—Banks granted permission to accept up to 100 per cent of their capital and surplus during 1917. Blackstone Canal National Bank, Mechanics National Bank, New Bed- Providence, R. I. ford, Mass. Safety Fund National Bank, Fitch- Massasoit-Poccaset National Bank, burg, Mass. Fall River, Mass. Hartford-Aetna National Bank, Hart- National Union Bank, Boston, Mass. ford, Conn. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

242 ANNUAL REFOBT OF THE FEDEKAL RESERVE BOARD. SCHEDULE 18.—Discount rates. Secured by United States certificates Agricul- of indebtedness Date. M 1 t 5 ie a d s tu a o r y f i s - M 1 t 6 i a e t s t o u o r 9 f i 0 - l t i p u v a r e p a - e l s t r a o n 9 c d 1 k A T c r c a e d p e t- m C o o d m it - y o B r o n L d i s b . erty Loan or less. days. days to 6 ances. paper. months^ 15 days 16 to 90 or less. days. Dec. 7,1916 It 4 5 34 4 M Ju a n r e 2 1 1 2 , , 1 1 9 91 1 7 7.. 4 4 5 5 i3 3 i 4 4 4 34 1 Oct 23 1917 3i 4 5 4 23§ Dec 5,1917. . 34 f 5 4 4 34 Dec 12,1917. 4 5 4 (3) 34 iJune 26, acceptances under 91 days, 4 per cent. 2 Customers of nonmember banks, 4 per cent. 3Merged with commercial paper rates of corresponding maturities on Dec. 5,1917. SCHEDULE 19.—Reserves of national banks in Neto England as reported by Comptroller of the Currency. Required Excess Date. Total reserve. reserve. reserve. Dec. 27, 1916. $172,535,000 $111,335,000 $61,200,000 Mar. 5, 1917 . 189,557,000 119,637,000 69,920,000 May 1,1917.. 190,443,000 117,143,000 73,300,000 June 20, 1917. 170,872,000 111,832,000 59,040,000 Sept. 11, 1917 i 56,725,000 55,823,000 2902,000 Nov. 20,1917 56,069,000 54,766,000 1,303,000 1 Cash in vault and due from national banks, not included as reserve, $108,250,000. 2 Deficiency. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

243 DISTRICT NO. 1—BOSTON. SCHEDULE 2O.-Member bank deposits at close of business each Friday. In Millions oo 100 90 90 80 80 \ f V 70 70 60 60 50 50 N 40 4< 30 3 20 2 10 0 Jan Feb. Mar. Apr. May'June July Aug.,Jept QG£ uec. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

244 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. SCHEDULE 21.—Treasurer of United States, general account at close of business each Friday. In Mil/ionis, 70 70 60 60 L 50 50 4^ 40 1 40 nr — n 30 30 \ i to /M 1 20 A A 1 i V io / 1 • v /\ 1 y to XT / \! l / V ft 0 m -If n. Feb. Mar. Apr. May June July Aug. Sept Oct. Nov. Dec. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 1—BOSTON. 245 SCHEDULE 22.—Amount toith Government depositaries each JFriday. In Mil/ions 200 HI] 190 I i 180 170 160 150 140 130 \ 120 110 100 I 1 90 A 80 A 70 A 60 ji \ 50 \ 40 Xzi \ I 30 V \ / 20 \ 10 A V 0 May June July August Sept Oct Nov. Dec. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

246 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. SCHEDULE 23.—Certificates of indebtedness issued at Boston. Amount issued in each denomination (in Numthousands of dollars). ber of Dated. Due. Rate. sub- Paid for by Total scrip- credit. issued. $500 $1,000 $5,000 $10,000 $100,000 tions. Mar. 29 June 29 2 U2 1 $3,000,000 Apr. 25 June 30 3 1,200 3,800 8,800 41 13,800,000 May 1 ...do 3 1,210 790 68 2,000,000 May 10 July 17 3 2,007 4,310 4,050 1,800 105 $5,450,000 12,167,000 May 25 July 30 3i 2,200 5,000 3,700 300 68 11,200,000 June 8 ...do 31; 3,005 5,825 4,370 5,000 74 3,652,000 18,200,000 Aug. 9 Nov. 11 3i 3,590 6,790 3,920 5,100 53 6,500,000 19,400,000 Aug. 28 Nov. 30 3* 1,645 3,375 3,620 6,500 62 4,593,000 15,140,000 Sept. 17 Dec. 15 3* 1,951 3,160 4,460 2,600 45 5,195,000 12,171,000 Sept. 26 ...do 4,149 6,495 8,030 3,500 126 12,245,000 22,174,000 Oct. 18 Nov. 22 4 3,454 5,965 16,630 4,100 138 21,349,000 30,149,000 Oct. 24 Dec. 15 4 2,325 4,175 16,510 10,000 102 27,590,000 33,010,000 Nov. 30 June 25 4 301 1,650 3,580 13,490 1,900 37 20,090,000 20,921,000 i Federal Reserve Bank took 12 certificates of $250,000 each. SCHEDULE 24.—Certificates of indebtedness. Apr. 25,1917. May 1,1917. May 10,1917. May 25, 1917. Amount allotted to subscriber. s S c e u r r b i . b - - am To o t u a n l t. s S c e u r r b i . b - - am To o t u a n l t. s S c e u r r b i . b - - am To o t u a n l t. s S c e u r r b i . b - - am To o t u a n l t. $25 000 and less 8 $140,000 51 $570,000 59 $668,000 36 $432,000 Over $25,000 to $50,000 10 500,000 11 485,000 17 761,000 11 506,000 Over $50,000 to $100,000 6 600,000 3 275,000 12 1,003,000 9 770,000 Over $100,000 to $250,000 9 2,110,000 3 670,000 8 1,635,000 7 1,292,000 Over $250,000 to $500,000 3 1,200,000 4 1,850,000 1 400,000 Over $500,000 to $1,000,000 2 1,750,000 3 2,750,000 1 600,000 Over SI 000 000 3 7,500,000 2 3,500,000 3 7,200,000 Total 41 13,800,000 68 2,000,000 105 12,167,000 68 11,200,000 June 8,1917. Aug. 9, 1917. Aug. 28,1917. Sept, 17, 1917. Amount allotted to subscriber. Sub- Total Sub- Total Sub- Total Sub- Total scrib- amount. scrib- amount. scrib- amount. scrib- amount. er. er. er. er. $25 000 and less 27 $423,000 21 $290,000 24 $364,000 48 $649,000 Over $25,000 to $50,000 10 . 470,000 13 645,000 10 410,000 28 1,233,000 Over $.50,000 to $100,000 14 1,230,000 7 635,000 12 960,000 16 1,466,000 Over $100,000 to $250,000 12 2,107,000 6 1,180,000 10 1,680,000 12 2,300,000 Over $250,000 to $500,000 4 1,520,000 1 400,000 4 1,326,000 15 6,426,000 Over $500,000 to $1,000,000 4 2,950,000 1 750,000 4 4,000,000 Over $1 000,000 3 9,500,000 4 15,500,000 2 10,400,000 3> 6,100,000 Total 74 18,200,000 53 19,400,000 62 15,140,000 126 22,174,000 Sept. 26,1917. Oct. 18, 1917. Oct. 24, 1917. Nov. 30, 1917. Amount allotted to subscriber. s S c e u r r b i . b - - am To o t u a n l t. s S c e u r r b i . b - - am To o t u a n l t. s S c e u r r b i . b - - am To o t u a n l t. s S c e u r r b i . b - - am To o t u a n l t. $25 000 and less 15 $277,000 58 $806,000 35 $525,000 11 $151,000 Over $25,000 to $50,000. 11 540,000 26 1,129,000 24 1,060,000 11 500,000 Over $50,000 to $100,000 6 575,000 28 2,540,000 19 1,725,000 4 360.000 Over $100,000 to $250,000 5 1,150,000 12 2,674,000 8 1,700,000 2 460,000 Over $250,000 to $500,000 5 1,900,000 6 2,800,000 9 4,000,000 6 2,650,000 Over $500,000 to $1,000,000 1 729,000 2 2,000,000 1 800,000 Over $1,000,000 2 7,000/000 8 20,200,000 5 22,000,000 2 16,000,000 Total 45 12,171,000 134 30,149,000 102 33,010,000 37 20,921,000 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT £T0. 1 BOSTON. 247 SCHEDULE 25.—The Liberty loans. s N ub u s m cr b i e b r e o rs f . Subscriptions. Allotment. State. l F o i a r n st . S l e o c a o n n . d l F o i a r n st . S l e o c a o n n . d Total. l F o i a r n st . S l e o c a o n n . d Total. Maine 68,539 68,575 $15,186,800 $24,002,850 $39,189,650 $14,332,300 $22,996,100 $37,328,400 New Hampshire... 55,374 48,548 10,515,150 15,992,900 26,508,050 9.89T,500 15,484,400 25 381 900 Vermont 33,418 33,769 7,377,650 10,193,250 17,570,900 6^92,150 10,061,550 17,053,700 Massachusetts 613,651 444,829 234,747,000 325,599,800 560,346,800 177,236,400 273,241,600 450,478,000 Rhode Island 82,391 51,429 25,377,700 38,803,450 64,181,150 23,073,900 33,466,050 56,539,950 Connecticut 117,418 99,491 39,283,300 62,357,800101,641,100 33,485,650 52,064,000 85,949,650 Total 970,791 746,641332,447,600J476,950,050 808,427,650 265,017,900 407,713,700 672,731,600 Additional allotment transferred from Philadelphia 816,300 Grand total. 408,530,000 SCHEDULE 26.—Subscriptions to Liberty loan bonds. First Liberty loan. Second Liberty loan. Date. Day. Total. Date. Day. Total. 1917. 1917. May 16 $545,800 $545,800 Oct. 3 $12,536,000 $12,536,000 May 17 731,700 1,277,500 Oct. 4 6,425,000 18,895,000 May 18 825,150 2,102,650 Oct. 5 7,702,000 26,647,000 May 19 1,168,400 3,271,050 Oct. 6 2,616,000 29,300,000 May 21 716,900 3,987,950 Oct. 7 6,341,000 35,546,000 May22 2,614,350 6,602,300 Oct. 8 6,540,000 42,183,000 May23 2,175,000 8,777,300 Oct. 10 6,749,000 48,629,000 May 24 5,267,300 14,044,600 Oct. 12 10,525,000 59,114,000 May 25 4,861,750 18,906,350 Oct. 13... 9,291,000 68,381,000 May 26 1,960,700 20,867,050 Oct. 15 9,365,000 77,737,000 May28 6,029,800 26,986,850 Oct. 16 18,243,000 95,879,000 May 29 575,600 27,472,450 Oct. 17 19,505,000 115,385,000 May31 29,142, 700 56,615,150 Oct. 18 26,144,000 141,516,000 June 1 5,959,500 62,574,650 Oct. 19 27,965,000 169,338,000 June 2 15,386,750 77,961,400 Oct. 20 16,451,000 185,789,000 June 4 11,932,850 89,894,250 Oct. 22 19,996,000 205,743,000 June 5 4,524,400 94,418,650 Oct. 23 32,136,000 237,875,000 June 6 5,146,900 99,565,550 Oct. 24 52,770,000 290,690,000 June 7 8,266,850 107,832,400 Oct. 25 46,378,000 337,069,000 June 8 7,493,000 115,325,400 Oct. 26 49,270,000 386,347,000 June 9 8,794,000 124,119,400 Oct. 27 90,603,000 476,950,000 June 11 12,817,250 136,936,650 June 12 11,710,300 148,646,950 June 13 12,785,900 161,432,850 June 14 26,073,650 187,506,500 June 15 144,941,100 332,447,600 SCHEDULE 27.—Liberty loan subscriptions and allotments through Federal Reserve Bank of Boston. First Liberty loan. Second Liberty loan. Size of subscription. sub T sc o r t i a b l ed. al T lo o t t t a e l d. Size of subscription. sub T sc o r t i a b l ed. al T lo o t t t a e l d. S50-$10,000 $203,265,000 $203,265,000 $50-$10,000 $186,136,050 $186,136,050 $10,050-$100,000 65,505,000 39,303,000 $10,050-$50,000 73,581,100 73,581,100 $100,050-$250,000 22,875,000 10,294,000 $50,050-$100,000 50,363,350 45,327,050 Over $250,000 40,802,000 12,155, 000 $100,050-4200,000 31, 734, 450 23,800,850 $200,050-$l ,000,000 109,935,100 66,268,650 Total 332,447,000 265; 017,000 Over $1,000,000 25,200,000 12,600,000 Total 476,950,050 407,713,700 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

248 ANNUAL BEPOBT OF THE FEDERAL RESERVE BOARD. SCHEDULE 27A.—Charade?* of Liberty loan payments. FIRST LOAN. Date. By cash. G B d o e v y p e c r o n r s e m i d ts e i . t nt i C n e d r e ti b f t ic e a d t n e e s s o s f . Total.' i A n c te c r ru es e t d . June 28 $71,155,767.52 $55,851,455.32 $43,758,000.00 $170,765,222.84 $89,503.84 Aug. 30 i 90, 724,358.88 173,622.11 1,330.000.00 92,227,980.99 513,202.99 Total 161,880,126.40 56,025,077.43 45,088,000.00 262,993,203.83 602,706.83 SECOND LOAN. 2 per cent payments. $4 055 738.00 $5,153,004.00 208,742.00 Cash sales 14 345,150.00 3,084,100.00 17 329,250.00 Nov. 15 . 55 630 311.50 170,328,176.50 S40 435 000 00 393,488.00 Dec. 15 14,183,028.28 59,793,191.55 73,869.420.00 $106,799.83 Total« 88,114,227.78 238,358,472.05 40,435 000.00 366,800,900.00 106 799.83 1 Includes all payments after June 28,1917. 8 Final payment is due Jan. 15,1918. SCHEDULE 28.—Federal Reserve notes issued. Denomination. 1915 1916 1917 Total. Fives $3,620,000 $6,226,600 $12, 700,000 $22,546,600 Tens 4,680,000 3,965,600 39,880,000 48,525,600 Twenties... 640,000 88,200 13,760,000 14,488,200 Fifties 600,000 42,000 3,460,000 4,102,000 Hundreds.. 980,000 102,300 5,920,000 7,002,300 Total 10,520,000 10,424,700 75,720,000 96,664, 700 SCHEDULE 29.—Federal Reserve notes redeemed. Denomination. January. February. March. April. May. June. July. August. Fives $193,650 $349,955 $264,445 $214,900 $432,200 $255,200 $230,470 $531,450 Tens 209,100 372,110 189,305 149, 800 260,800 141,000 267,300 557,100 Twenties... 6,900 36,110 12, 700 2,100 29,300 12,000 23,200 2,800 Fifties 3,250 13,-850 32,250 12,750 17,000 1,800 16,600 1,050 Hundreds.. 4,100 53,200 13,300 12,100 22,300 1,100 32,100 1,300 Total 417;,000 825,225 512,000 391,650 761,600 411,100 569,670 1,093,700 Re- Redeemed deemed Denomination. September October. November. December. Total. Un b i y ted Fe b d y eral States Reserve Treasury. agent. Fives $857,600 $834,700 81,278,110 $985,650 $6,428,330 $793,330 $5,635,000 Tens 327,725 446,400 788, 205 942, 920 4,651,765 732,765 3,919,000 Twenties.. 33,210 74, 900 87,600 106,200 427,020 51,020 376,000 Fifties 1,800 36,450 22,200 16,750 175,750 25,750 i50,000 Hundreds., 2,400 62,000 22,400 32,400 258,700 28,700 230,000 Total 1,222,735 1,454,450 3,198,515 2,083,920 11,941,565 1,631,565 10,310,000 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 1 BOSTON. 249 SCHEDULE 30.—Federal Reserve notes of the Federal Reserve Bank of Boston received from other Federal Reserve Banks, and notes of other Federal Reserve Banks returned by Federal Reserve Bank of Boston to bank of issue. Received. Returned. 1916 1916 1917 New York $1,361,750 $3,064,200 •3,039,000 $9,552,800 Philadelphia. 133,380 368,000 180,000 634,700 Cleveland 13,820 38,915 136,000 352,900 Richmond... 15,020 47,500 185,000 263,900 Atlanta 19,465 135,400 112,000 193,200 Chicago 90,500 232,500 24,000 347,800 St. Louis 11,480 53,450 28,000 100,900 Minneapolis.. 10,440 15,000 68,500 142,200 Kansas City.. 1,785 8,815 49,000 126,600 Dallas 4,420 283,695 74,000 141,400 San Francisco 18,240 29,025 57,000 156,500 Total... 1,680,300 4,276,500 3,952,500 12,012,900 SCHEDULE 31.—Volume of checks handled for members and for other Federal Reserve Banks, Jan. 1, 1917, to Dec. 31, 1917. Drawn on New Eng- B 1 o a st o n n d . , including Dra d w is n t r o ic n t o s. ther Total. Date. By whom deposited. Items. Amount. Items. Amount. Items. Amount. Jan Members district No. 1 929,029$211,442,054 75,036 $76,532,661 1,004,065$287,974,715 Other Federal Reserve Banks 82,156 69,467,250 82,156 69,467,250 Total 1,011,185 280,909,304 75,036 76,532,661 1,086,221 357,441,965 Feb... Members district No. 1 764,681 200,232,603 58,600 81,996,602 823,281 282,229,205 Other Federal Reserve Banks 72,938 66,896,145 72,938 66,896,145 Total 837,619 267,128,748 58,600 81,996,602 896,219 349,125,350 Mar... Members district No. 1 916,827 255,083,791 69,428 104,044,163 986,255 359,127,954 Other Federal Reserve Banks 88,453 82,912, 248 88,453 82,912,248 Total 1,005,280 337,996,039 69,428 104,044,163 1,074,708 442,040,202 Apr... Members district No. 1 907,369 269,959,036 67,867 118,346,778 975,236 388,305,814 Other Federal Reserve Banks 94,424 93,634,390 94,424 93,634,390 Total 1,001,793 373,593,426 67,867 118,346,778 1,069,660 481,940,204 May... Members district No. 1 990,372 313,277,248 72,090 120,536,944 1,062,462 433,814,192 Other Federal Reserve Banks 104,794 100,449,534 104,794 100,449,534 Total 1,095,166 413,726,782 72,090 120,536,944 1,167,256 534,263,726 June... Members district No. 1 990,636 376,892,158 73,771 145,650,156 1,064,407 522,542,314 Other Federal Reserve Banks 96,428 106,836,301, 96,428 106,836,301 Total 1,087,064 483,728,459 73,771 145,650,156 1,160,835 629,378,615 July... Members district No. 1 966,518 385,506,704 73,512 154,076,421 1,040,030 539,583,125 Other Federal Reserve Banks 97,827 106,362,288 97,827 106,362,288 Total 1,064,345 491,868,992 73,512 154,076,421 1,137,857 645,945,413 Aug... Members district No. 1 933,950 405,192,613 76,077 143,438,330 1,010,027 548,630,943 Other Federal Reserve Banks 99,024 101,330,698 99,024 101,330,698 Total 1,032,974 506,523,311 76,077 143,438,330 1,109,051 649,961,641 Sept... Members district No. 1 866,931 348,442,753 78,427 131,225,648 945,358 479,668,401 Other Federal Reserve Banks 98,289 99,602,284 98,289 99,602,284 Total 965,220 448,045,037 78,427 131,225,648 1,043,647 579,270,685 Oct.... Members district No. 1 1,040,717 415,574,376 97,447 155,269,617 1,138,164 570,843,993 Other Federal Reserve Banks 117,360 126,244,959 117,360 126,244,959 Total . 1,158,077 541,819,335 97,447 155,269,617 1,255,524 697,088,952 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

250 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. SCHEDULE 31.—Volume of checks handled for members and for other Federal Reserve Banks, Jan. 1, 1911, to Dec. 31, i£i7—Continued. Drawn on New Eng- 1 B a o s n to d n , . including Dra D w i n s t o ri n c t o s. ther Total. Date. By whom deposited. Items. Amount. Items. Amount. Items. Amount. Nov... Members district No. 1 1,000,347$488,767,678 93,904$155,026,132 1,094,251$643,793,810 Other Federal Reserve Banks 120,246 149,586,318 120,246 149,586,318 Total. .. 1,120,593 638,353,996 93,904 155,026,132 1,214,497 793,380,128 Dec... Members district No. 1 1,024,260 467,096,007 102,094 166,494,366 1,126,354 633,590,373 Other Federal Reserve Banks 140,652 157,883,533 140,652 157,883,533 Total 1,164,912 624,979,540 102,094 166,494,366 1,267,006 791,473,906 Grand total 12,544,228J5,398,672,969 938,2531,552,637,81813,482,4816,951,310,787 This schedule does not include Government checks shown in Schedule 32. SCHEDULE 32.—Number of checks drawn on Treasurer of Untied States handled by Federal Reserve Bank of Boston. Number Number Total of of number Month. pension Amount. other Amount. of Amount. checks. checks. checks. January 10,230 $517,519.99 15,390 $3,400.482. 59 25,620 S3,918002.58 February.. 2,481 110,476. 60 14,853 2,357!041.29 17,334 2,467!517.89 March 28,622 1,797,566.15 22,466 2,152,905.35 51,088 3,950:471.50 M Ap a r y il 8 1, , 6 8 8 3 8 2 4 9 8 6 6 , , 1 0 3 1 1 2 . . 9 7 7 2 2 1 2 7 , , 6 57 6 1 6 3 3, , 6 4 8 0 1 0 ,;4 7 5 8 8 9 . .7 ti 5 2 2 2 4 5 , ,9 3 0 5 3 4 3 3, , 7 8 7 8 7 6 : : 9 4 2 7 1 1 . . 7 3 2 4 June 30,311 1,841,444.80 23,051 8,280.477.69 53,362 10,121:922.49 July 7,530 482,184.15 29,299 21,143]385.80 36,829 21,625:569.95 August 1,847 105,168.96 37,807 23,762,400.72 39,654 23,867:569.68 September. 29,520 1,843,009.61 40,944 29,400.409.58 70,464 31,243:419.19 October 8,729 1,917,507.76 45,475 37,614'297.03 54,204 39,53i:804.79 November. 1,472 94,245.13 51,714 49,737!.209.52 53,186 49,831:454.65 December. 28,802 2,055,398.14 53,200 49,926:034.73 82,002 51,981; 432.87 Total 159,564 11,346,665.98 374,436 234,856,892.67 534,000 246,203,558.65 SCHEDULE 33.—Gold settlement fund operations, Jan. 1, 1017, to Dec. 31, 1917. Amount Amount received in paid in settlement of settlement of Gain Loss Reserve Bank. ac fr c o o m un o ts th d e u r e acc t o o u o n t t h s e d r ue t w hr e o e u k g ly h t w hr e o e u k g ly h Federal Re- Federal Re- settlements. settlements. serve Banks. serve Banks. New York $1,282,707,000 $1,091,785,000 $190,922,000 Philadelphia.., 254,752,000 218,375,000 36,377,000 Cleveland 74,426,000 88,571,000 $14,145,000 Richmond 40,147,000 32,286,000 7,861,000 Atlanta 17,834,000 22,961.000 5,127,000 Chicago 132,500,000 190,376,000 57,876,000 St. Louis 41,699,000 67,800,000 26,101,000 Minneapolis 41,871,000 28,471,000 13,400,000 Kansas City... 22,856,000 14,338,000 8,518,000 Dallas 12,340,000 19,142,000 6,802,000 San Francisco. 13,988,000 20,299,000 6,311,000 Total 1,935,120,000 1,794,404,000 257,078,000 116,362,000 Gain through settlement 140,716,000 Net loss through transfers "i35,*7i7,*666 Net gain through transfers and settlement 4,999,000 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 1—BOSTON. 251 SCHEDULE 84.—Maturities of invested funds (not including United States bonds or notes). Month. Within 15 (lays. 16 to 30 days. 31 to 60 days. 61 to 90 days. Over 90 Total. days. January $3,384,387.59 $3,145,572.37 $5,127,604. 97 $3,253,854.30 $5,900. 00$14,917,319.23 February 4,240,441.40 2,803,991.97 5,200,900.14 3,956,657.32 126,977.75 16,328,968.58 March 6,339,579.02 4,604,292,08 4,722,577.25 1,945,646.21 17,612,094.56 April 6, 868,449.75 2,305,541. 71 2,971 451.44 815,956.80 12,961,399.70 May 5,782,614.46 1,079,697.43 3,436,545.90 5,304,956.00 15, 603,813. 79 June 13,485,534.92 3,630,761. 89 8,075.533.98 9,991,796.48 35,183,627.27 July. 8,691, 895. 29 4,545,135.67 12,109;702.11 5,090,152.89 100.00 30,436,985.96 August 13,189,169.97 9,254,373. 34 8,684,667. 30 6,736,081.12 37,864,291.73 September.. 8,019,481.18 5,288,955. 73 11,211,333.40 13,359,830.75 "386.25 37,879,987.31 October 8,624,946.44 3,497,694.46 16,287,214.73 6,508,997.06 34,918,852.69 November.. 11,541,062.63 14,128,035.97 10,957.876.70 34,483,180.52 71,110,155.82 December... 14,028,234.18 9;007;576.15 9, 576^917.94 41,658,773.60 74,271,501.87 SCHEDULE 35.—Distribution, by maturities, of tills rediscount ed for member banks, Jan. 1, 1017, to Dec. 31, 1917. Month. 1 to 15 days. 16 to 30 days. 31 to 60 days. 60 to 90 days. Over 90 days. Total. January $847,389. 05 $102,135.52 $126,008.50 $122,928.67 $1,198,461.74 February 1, 882,783.36 1,015,169. 53 702,647.25 332,388. 08 3,932,988.22 March 3,816,627. 87 298,484.96 574,161. 56 409,488.76 5,098,763.15 April 9,118,269.32 180,268.91 454,770. 63 196,113. 46 9,949,422. 32 May 9,493,344.80 428,929. 21 445,623. 09 934,332.06 $200. 00 11,302,429.16 June 34,571,777.01 6,196, 820. 77 2,082,554.17 3,365,573.33 46,216,725.28 July 35,073,960.03 2,760,025.49 1,583,856. 80 3,012,316. 60 325. 00 42,430,483.92 August 16,902,573.21 2,179,412. 22 2,936,784.55 4,358,337.48 26,377,107.46 September... 21,307,151.47 1,105,028.91 1,567,284.14 1,768,743.98 262,077.15 26,010,285.65 October 6,770, 804.48 770,203.90 1,274,928.51 2,389,172.12 580,860. 00 11,785,969.01 November... 14,243,720.77 9,918,880.69 4,086,615.21 32,169,170.13 119,432.71 60,537,799.51 December 20,137,601.91 14,922,952.50 25,837,504. 02 44,947, 757. 06 233,060.01 106,078, 875. 50 Total... 174,166,003.28 39,878,292.61 41,672,738.43 94,006,321,73 1,195,954. 87 350,919,310.92 SCHEDULE 36.—Classification by maturities of investments (exclusive of United States securities) at close of business Dec. 31, 1917. 15 days. 30 days. 60 days. 90 days. 90 O d v a e y r s. Total. J, Bills discounted, members. $3,321,793.09 m,527,991.39163,603,533.8512!, 864,811.50 $9,116.25 $19.327,246.08 Trade acceptances discounted 287,536.22 816,660.94 358,906.25 1,337,449.03! ,800,552.44 Member banks' collateral notes 7,349,338.00 ,349,338.00 Rediscounts secured by Liberty loan bonds 151,257.17 493,425.12 3,643,823.7732,116,718.77 ,405,222.83 Foreign bankers' acceptances 100,000.00 88,302. 369,734.40 1,999,559.41 ,557,596.50 Domestic bankers' acceptances , 33,207.10 503,609.00 828,178. 4,438,522.28 72,500.00 ,876,017.36 Foreign trade acceptances, 346,875.40 257,016.78 603,892.18 Total 11,590,006.98 8,687,005.9211,804,177.25 42,757,058.99 81,616.25 74,919,865.39 34305° Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 2—NEW YORK. PIEREE JAY, Chairman and Federal Reserve Agent. RESULTS or OPERATION. BALANCE SHEET. The following is a statement comparing the condition of the Federal Reserve Bank of New York on December 31, 1917, with that of December 30, 1916, and showing the increase and decrease in the various items of resources and liabilities: Dec. 31, 1917. Dec. 31, 1916. RESOURCES. Loans and discounts: Bills discounted for member banks $225.117,913.30 $7,071,158.55 Acceptances purchased i4s;770,185.44 41,457,184.04 Rediscounts for other Federal Reserve Banks 191,033.66 United States bonds 168, 599.64 "l, 042,'550. 00 United States 1 year Treasury notes 4,493, 000. 00 1,205, 000. 00 United States certificates of indebtedness 15,000, 000. 00 Municipal warrants 510,701.32 972,311.62 Total investments 424,251,433.36 51,748,204.21 Reserve cash: Gold with Federal Reserve agent 1 250,598,565.00 107,003,765.00 Gold redemption fund for Federal Reserve notes. 10,000.000.00 250,000.00 Gold settlement fund 5,854,000. 00 20,570,000.00 Gold bullion 68,113, 616. 99 Gold coin and certificates 275,130,455.00 159,321,257.50 Legal tender notes 31,322,275.00 11,188, 200.00 Silver certificates and coin 8,925, 743. 85 4,077,274. 80 Total reserves ! 649,944,655.84 I 302,410,497.30 Other resources: Federal reserve notes and other cash. 752,685.24 13,865,897.46 Items in process of collection. 091,790.20 23,077,418.64 Exchanges for clearing house and sundry cash items 429,660. 74 2,503,168.21 Interest accrued on United States bonds 73,620.28 12,501.88 Cost of unissued Federal Reserve notes. 235', 598.86 Deferred charges and prepaid expenses 20,458.22 8,753.52 Advances made for Treasury, United States, account expenses Liberty loan and war savings committees 360,350.01 Total other resources 134,728,564.69 39,703,338.57 Total resources 1,208,924,653. 393,862,040.08 Capital fund: Capital paid in. 18,695,950.00 11,865,750.00 Surplus! 649,363.56 Profit and loss . 163,063.'9*8 Total capital fund 19,345,313.56 12,028,813.9 1 Inserted in 1918 report for purposes of comparison. 253 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

254 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. Dec. 31,1917. Dec. 31, 1916. Deposits: Due to United States Government $11,870.767.74 $3,571,391.94 Due to foreign Governments 3,335,930.00 Due to nonmember banks, deposit account 10,317,630.16 Due to member banks—reserve balances 652,791,808.26 237,907.354.87 Due to member banks—uncollected funds 35,553,478.43 18,552; 984.84 Due to other Federal Reserve Banks—collected funds 7,610,609.86 12,373,721.91 Due to other Federal Reserve Banks—uncollected funds 156.779.75 2,085,975.49 Cashier's checks outstanding 821,683.09 188,275.81 Gross deposits.. 731,458,687.29 274,679,704.86 Other liabilities: Depreciation reserve 205,880.00 Unearned discount and interest 1,348,238.04 149,756.24 Participation certificates Liberty loan bonds. 227,970.00 Federal Reserve notes outstanding1 456,338,565.00 *iO7,* 003* 765.66 Total other liabilities.. 458,120,653.04 107,153,521.24 Total liabilities .1,208,924,653.89 393,862,040.08 The great increase in many of the items of resources and liabilities may be traced quite directly to the changed conditions created by the amendments to the Federal Reserve Act approved June 21, 1917. These amendments greatly increased the balances of the member banks, placed on the balance sheet the entire note liability and the gold and lawful money held by the Federal Reserve agent, permitted nonmember banks to open clearing accounts, and b}^ establishing in the statute the rights and duties of State institutions as member banks prepared the way for the membership of a large number of these institutions. The remaining changes are largely due to the activities of this bank in rendering assistance to the Government and to its members in the financial operations entailed by the war. The changes in the balance sheet will later be commented upon in detail under the appropriate headings. INCOME AND EXPENSE. The following statement shows the income and expense of the bank for the years 1916 and 1917: 1917 1916 INCOME. Bills discounted for members $2,455,532.87 $37,368.26 Acceptances bought A* 1,843,324.87 530,483.75 United States securities 378,668.40 81,644.49 Municipal warrants , 66,470.41 214,122.13 Profit realized on United States bonds... 14,335.50 43,515.01 Commissions received , 38,537.54 42,387.09 Profit on bills sold 8,077.03 Penalties for deficient reserves 18,565.29 Service charges , 80,922.53 32,959.90 Sundry profits 24,779.51 1,128.59 Total 4,929,213.95 983,609. 22 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTKICT NO. 2 NEW YORK. 255 1917 . 1916 EXPENSE. Directors' fees, outside conferences, and Federal Advisory Council $18,301.61 $10,768.34 Salaries 398 282.81 215,307.51 Rent 55,550. 91 45,810.04 General expenses ... 329,096. 98 151,200.36 Cost of Federal Reserve notes used 343 764.88 95,240.00 Assessment for expenses of Federal Reserve Board 50,252.09 39,029.38 Total 1,195,249.28 557,352.12 Net earnings 3, 733, 964.67 426.257.10 Profit and loss balance, Dec. 30,1916 $163 063. Net debits during year 4 355.?1 158,708.77 3,892,673.44 Deductions, Dec. 31,1917: Cost of unissued Federal Reserve notes charged oil 445,248.14 Depreciation reserve account set up ... 205,880.00 651.128.14 Dividends paid during 1917: To liquidated banks 1 176. Apr. 1, 1915, to Dec. 31, 1915, paid June 30,1917 474, 776.12 Jan. 1,1916, to Dec. 31,1917, paid Dec. 31,1917 .. 1,466,865.51 1.942,818.17 Paid to Treasurer of United States as franchise tax, Dec. 31, 1917 649,363.57 Carried to surplus 649,363.56 Total.. . 3 892 673.44 The great expansion which has occurred in the business of the bank during 1917 is reflected not only in the increased earnings but also in the increased expenses for salaries, rent, and printing Federal Ileserve notes, which will be referred to in more detail later. The item " General expenses " includes cost of furniture and equipment, stationery and printing, telephone, telegraph, postage, expressage, insurance, as well as the entire expense of operation of the transit department, including expenditures of the kind just mentioned, salaries -and rent. At the close of the year, after allowing for all current expenses, and paying dividends to date as above indicated, charging off all assets of a nonliquidating character and setting aside a reserve for depreciation on United States 3 per cent conversion bonds and for certain obligations under the lease of the banking office, the Federal Eeserve Bank, under the provisions of section 7 of the Federal Eeserve Act, paid into the Treasury of the United States as a franchise tax $649,363.57, being 50 per cent of the net earnings to date, and carried a like amount to surplus fund. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

256 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. DISCOUNT KATES. The discount rates established by the Federal Reserve Bank of New York during the year, and the rates at which acceptances were purchased in the open market have been as follows: (Special.) •Open-market Secured purchases, bankers' by. (Special.) acceptances. Month. c ( 1 o l i o o n 5 l r l i a c a n n d l l t g e u e s a s r d ) y s a . - s l d c 1 a l 6 u y s s t i , o v i e n 9 . - 0 m A 9 p t 1 g o H t a r o n p i d r c t a e 6 a h u l r y s l- . s i b n L c U c o S d a i e n n b t t e r e a d i t e b t i s t s r f e t e e i t o s d o - y d f r - c t n G i c o o o 1 o m l o n - t l n v d e a e n w a e t s n e e r y t i i c n r t n a - h - l a a T c n r c c a e e d p s e t . - iz A ed ut r h a o te r- s .1 A ra c t t e u s a . l ness financing. within 16-90 days. Per cent. Per cent. Per cent. Per cent. Per cent. Per cent. Per cent. Per cent. January 3 4 5 2 -4 February..,.. 3 4 5 2 -4 March 3 4 5 U 2 -4 April 3 4 5 2J-4 l J M u a n y e 3 3 4 4 5 5 2-4 31 i|-4 3 -4 July 3 4 5 2-4 24-4 . 3 -4 August 3 4 5 2-4 24-4 3 -4 September 3 4 5 2-4 24-4 3 -4 October 3 4 5 2-4 2.V-4 3m-—4 November 3 4 5 2-4 2|-4 of-4 December 1-20.. 3 4 5 December 21-31 34 4-1 3-4J 1 32-44 i 3H1 1 Acceptance rates advanced Dec. 7. To assist the Government financing, a special rate of 8-J- per cent was established on May 22 for discounts maturing within 90 days secured by United States certificates of indebtedness or Liberty bonds. On June 13 a special rate of 2 per cent to 4 per cent was established for advances on member banks' one-day collateral notes secured by eligible commercial paper or United States Government obligations In connection with Government financing, and loans were made between June 5 and June 12 at the rate of 2-| per cent. Subsequently, loans of this character were made at the prevailing rate for maturities within 15 days. During the early part of the year the bank's 90-day discount rate continued, as in preceding years, to be above the open-market rate for commercial paper. Since the declaration of war, however, It has been substantially below the open-market rate for such paper. Th© change In the relative position of the two rates, however, led to no marked Increase in the discounting of this class of paper. Substantially all of the rates of the bank were increased about one-half of 1 per cent shortly after December 15, when the period of Government financing relating to the second Liberty loan had been completed, in order to bring the rates of the bank on commercial paper more nearly In line with the rates prevailing in the open market, and in order to stimulate liquidation of its discounts in anticipation of future Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO, 2—NEW YORK. 257 demands upon its credit facilities which will arise during succeeding periods of Government financing. INVESTMENTS OF THE FEDERAL RESERVE BANK or NEW YORK DURING 1917. MATURITIES OF INVESTMENTS AND LOANS. The following statement shows the maturities of investments, other than United States securities and warrants, held by the Federal Reserve Bank of New York December 31, 1917: Discounts or ad- Discounts or advan co ce m s m b e a r s c e i d a l on v U an n c i e t s e d b a S s t e a d t e o s n Bank a e n rs c ' e a s. ccept- Total. paper. securities. Within 15 days $55,972,882. 45 $81, 494,809. 69 $17,172,201.88 $154,639,894.02 16 to 30 days 7,261,070.62 1,028,580.10 22,354,778.42 30,644,429.14 31 to 60 days 32,153,380. 52 51,977,627.14 82,644,978. 39 166,775,988.05 61 to 90 days 16,327,611. 46 4,093,924. 98 26,598,226.75 47,019,763.19 Total 111,714,945.05 138,594,941.91. 148,770,185.44 399,080,0/2.40 MEMBER BANK DISCOUNTS AND ADVANCES. The early months of 1917 showed the usual small volume of advances and discounts for member banks, but, as the Government financing, which commenced shortly after our entrance into the war, began to assume important proportions, the discount facilities of the Federal Reserve Bank were availed of generally, and as the time for payments due June 15 on the first Liberty loan approached there was a rapid increase in the volume of acceptances purchased in the open market and discounts for member banks. The discounts for member banks, which amounted to less than $1,000,000 on June 1, had increased on June 19 to $168,000,000, while acceptances increased between the same dates from $86,000,000 to $89,000,000 and rose on June 27 to $1O3 OOO OOO. Total investments rose from $66,000,000 on 5 ? June 1 to $279,000,000 on June 19. The contraction was only slightly less abrupt than the expansion, for by August 15 the total investments of the bank had fallen to $68,000,000. "This sudden expansion of $213,000,000 in 19 days, which exceeded by $104,000,000 the largest amount of clearing-house certificates ever outstanding among the New York Clearing House banks, was due to two causes, which were also operative during the period of Government financing incident to the second issue of Liberty bonds. First, the withdrawal by interior banks of deposits kept with New York institutions in order to make payment in their respective Fed- Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

258 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. eral Reserve districts for United States certificates of indebtedness and for Liberty bonds purchased by such banks or through them. Interior banks usually make these payments by drafts on New York banks, which are sent to the Federal Reserve Bank of New York for collection through the clearing house and for settlement through the gold settlement fund. By this method the reserves of the New York banks are depleted and gold is transferred to the interior. To maintain their reserves the New York banks are obliged to come to the Federal Reserve Bank for discounts or advances. Usually these have been required only for short periods, running from a few days to a few weeks, because the funds gradually find their way back to New York, also through the gold settlement fund, as the United States Government makes most of its advances to the allied Governments and pays a large proportion of its own expenditures through the Federal Reserve Bank of New York. Second, the requirement for the creation of an immense volume of bank credit represented by short-term certificates of indebtedness, which the Government issues to provide itself with funds in anticipation of the sale of bonds. The total volume of these certificates outstanding in connection with the period of financing which ended with the first Liberty loan was $868,205,000, of which this Federal Reserve district took $479,962,000, or 53 per cent. When these credits are created by the banks, the law does not require any reserves to be maintained against them, but, as they are gradually drawn into the Federal Reserve Bank and disbursed by the Government, they are transformed from Government deposits, free of reserves, into individual deposits, requiring reserves, and, therefore, requiring larger balances to be kept with, the Federal Reserve Bank. As the allied Governments, to whom the bulk of the funds has thus far been distributed, make payments to interior points the banks have to discount with the Federal Reserve Bank to maintain their reserves. When these funds reach interior banks, balances withdrawn from New York for the payment of Liberty bonds are gradually built up again and the New York banks relieved of their strain. Each sale of bonds is, therefore, the culmination of a period of Government financing which begins with tremendous expansion of bank credit in favor of the Government and ends with wThat is in effect,- though not literally, a conversion of these short-time bank credits into long-time investment credits, namely Liberty bonds. This conversion enables the banks to contract their position somewhat and, by canceling the credits they have obtained at the Federal Reserve Bank, thereby contract the position of the Federal Reserve Bank as well and prepare it for another similar period of financing. During the period of financing ending with the payments for the second Liberty loan, the total amount of United States short-term Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT1 ETO. 2—NEW YOKK. 259 certificates of indebtedness issued throughout the country was $2,925,296,000 (including $690,000,000 due June 25, 1918, issued in anticipation of tax payments then due) of which the banks in this Federal Eeserve district purchased $1,961,613,500, or 67 per cent. The increased volume of the temporary financing in this period, compared with that of the. preceding period, involved larger movements of funds to and from the interior, larger fluctuations in bank reserves and considerably larger recourse to the credit power of the Federal Eeserve Bank. The first issue of certificates in connection with this period WTIS on August 9. On this date the total loans and investments of the bank were $78,000,000. On November 30, 15 days after the first payment for the Liberty loan bonds, they had grown to $522,000,000, an increase during this period of financing of $444.- 000,000. On one day, November 30, the increase was $111,000,000. On December 15, the maturity date of the last issue of certificates of indebtedness, the decrease in loans and investments was $219,000,000, indicating in a very striking way the effect of the Government certificates of indebtedness upon the discount activities of the Federal Eeserve Bank. The chart on the following page shows graphically the closeness of the relation between the Government's short-time financing on certificates of indebtedness and the expansion of the loans and investments of the Federal Eeserve Bank of New York. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

January March April May July flugusr Ocfoher IZI THE SOLiD LINE SHOWS THE TOTAL LOANS, DISCOUNTS ANO INVESTMENTS OV THE FEDERAL RESERVE BANK OF NEW YORK DURING 1^)7 THE DOTTED LiME SHOWS THE AMOUNTS OF U. S. CERTIFICATES OF tf-!DE':BTEi)Mf:S3 PURCHASED AND OUTSTANDING" IN THE SECOND FEDERAL RESERVE: DISTRICT DURSNO J917 \wuxapw P H O o p Fiaaacmg period of the first Liberty Loan Financingperiod'of'tne second Liberty Losn Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 2—NEW YORK. 261 The following is a statement of discounts for and advances to member banks, by months, during 1917, together with similar transactions during 1916: 1917 1916 Month. Number Number of items. Amount. of items. Amount. January 148 $598,162.06 117 $125,655. 65 February.. 171 1,925,351.05 73 98,304. 35 March..!... 237 3,062,583.13 249 304,638. 35 April 267 2,439,223. 25 149 149,950.15 May 523 6, 545,273.25 307 191,290. 38 June 2,034 552,976,458.11 325 348,405. 34 July 1,346 262,366,105. 28 116 235,494. 37 August 1,254 53,024,394. 91 241 586,851. 00 September. 1,625 319,543,993. 34 105 560,583. 29 October 2;544 2,382,893,110. 97 177 1,035' 118. 65 November. 3,213 2,663,667,291. 90 79 715| 293. 90 December.. 9,122 262,232,974.93 567 17,977,996. 38 Total 22,484 6,511,274,921.4 2,505 22,329, 581. 81 The immense volume of discounts and advances made during October and November, 1917, are due to the fact that many of the banks which borrowed most heavily did their borrowing for periods of from one to five days only, in order to readjust the amounts at each renewal to the requirements of their condition. In this way their borrowing became almost as flexible as if their loans had been on demand. The following figures show certain data concerning the discounts of 1916 and 1917: 1916 Number of apnlionlions received A:>i nr,it of applicuu JIIS r,*:vi\ e'l. Amount of applications aeropi^d end disoount^d or advanced upon. > p Number of piojofj oi'p^por (Us <,auied or advanced upon. J v^id piece cf paper d'scoi'i-!,nd or advanced tip. n.' £m iMfst piece ci paper dis^i oJcd c au\ an xd upon A vvru^e L'L,-> of a 4es cliso niiii.sd or ad\ nn xd up ,u IS amber of baiL.s rodio^ountii-g T BANKEES7 ACCEPTANCES AND THE DISCOUNT MARKET. This year has witnessed a continued increase in the volume of bankers' acceptances created and a steadily broadening open market in which they circulate. At the close of the year 1916 it was stated that there were outstanding about $250,000,000 of dollar acceptances, including bills of foreign origin on American merchants. It is not improbable that the volume of such paper in the United States at the close of 1917 is from four to five hundred million dollars. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

262 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. The increases, while general in all classes of bills eligible for discount with Federal Reserve Banks, are most notable in the bills arising from domestic transactions and from the increasing trade between the United States and the Orient. The following table, gathered from reports made to public officers, shows the amount of acceptance liabilities of national banks in district No. 2, and of State banks and trust companies in the State of New York: September, September, 1917. 1916. National banks $73,717,000 $44,300,877 Trust companies 91,424,509 68,588,558 State "banks.- , 7,355,910 2,787,995 Total 172,497,419 115,677,430 The more general recourse during the year to bankers' credits for financing the large seasonal movements in commodities is an indication of a wider understanding and appreciation, by the borrower and banker alike, of the advantages of this form of financing transactions that in themselves furnish the means of discharging the obligations incurred by the taker of credit and the acceptor. With the increased volume of business, the number of accepting banks and purchasers of bills also has steadily increased. The names of many well-known institutions located in the larger cities of the country have now become known as acceptors through their acceptances offered in the open market in New York. Also, dealers report an increasing interest on the part of out-of-town banks as investors in prime bills, evidenced both in the number of new buyers and the volume of their purchases. Indicative of the increase are the reports of two houses whose sales this year have in each case exceeded $300,- 000,000 and neither of which handled over $80,000,000 of bankers' bills last year. The larger number of dealers and bill brokers specializing in bankers5 acceptances is another indication of the widening interest in the development of the open market. The New York open-market discount rates during the year have advanced gradually until they were at the close about 1 per cent higher that at the end of last year. They have, nevertheless, been the most stable of all the money rates during the period. The purchases of the Federal Reserve Bank of New York have materially assisted in this stabilization, especially at times when, owing to the temporary requirements of the banks in this district and elsewhere, bills were offered in large volume for resale in the market or directly to the Federal Reserve Bank, and also when, during periods of adjustment incident to the large financial operations of the Government, the Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 2—NEW YORK. 263 market's absorption of newly accepted bills was more or less interrupted. On the whole, however, purchases by the Federal Eeserve Banks have been at rates determined by the law of supply and demand in the open market. By reference to the table showing the monthly purchases of acceptances by this bank for itself and other Federal Eeserve Banks, it will be seen that during March and April, when the open-market rates fell below those at which this bank was willing to purchase, practically the entire volume of acceptances was taken by the open market, and as a result the bill holdings of this bank decreased from $39,000,000 on January 2 to $15,000,000 on April 18. When the rates for money stiffened in June, incident to the transfers between New York and interior points, the market rates rose above those of the Federal Eeserve Bank and bills were taken in large volume by this bank, whose holdings of bills increased $66,000,000 during June. During the period of easy money, which began shortly after July 1, market rates again fell below those of the Federal Eeserve Bank and liquidation of its bills again occurred. The situation was reversed again as the demand for money increased and the time for payment on the second Liberty loan approached. By selling a large volume of its bills early in November to other Federal Eeserve Banks which, had not been drawn on so heavily by their members, this bank was placed in a position to maintain fairly stable rates for the purchase of bills during the strained period between November 15 and December 15, on -which latter date its holdings of bills aggregated $115,000,000. The somewhat higher rates that have obtained during the year, and the resulting wider demand have tended to diminish the distinction that has existed in the open market between the rates at which the acceptances of member banks and other well-known acceptors, private bankers, and others, were sold. This tendency to equalize the open-market discount rates for equally prime bills, makes for greater stability and freer use of dollar bills of exchange in foreign markets, where the fine grades of distinction existing here were not understood. The Federal Eeserve Bank has assisted in this equalization by its forward quotations for and purchase of prime bills to arrive from the foreign countries of origin, as well as by its recognition of the indorsements of both foreign banks and domestic banks and bankers. In its purchases the Federal Eeserve Bank has, by differential rates, emphasized its preference for indorsed paper and the shorter maturities; that is, for paper that has been sold in the market and is re-offered indorsed by the original and subsequent purchasers and is approaching maturity. This ordinarily enables a bank that carries Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

264 ANNUAL BEPOBT OF THE FEDERAL RESERVE BOARD. a secondary reserve line of bankers' acceptances to make an additional profit or higher average yield on bills carried by purchasing the longer bills at higher rates, and when they come, say, to within 30 days of maturity, indorsing and selling them to the Federal Reserve Bank at the minimum rates obtaining for short-time paper, and reinvesting the proceeds in new long bills. A large proportion of the bills now bought by the Federal Eeserve Bank bear one or more banking indorsements. This development in the practice of the market in New York, which has occurred within the year, is in accordance with the long-established practice in the open markets of Europe and constitutes one of the most significant evidences of the appreciation by our banks and bankers of what will be the logical development of a larger open market in this country and of the normal functions of a Federal Eeserve Bank as a bank of rediscount rather than one of original discount. The monthly purchases of acceptances and indorsed trade bills by this bank for itself and for other Federal Eeserve Banks have been as follows: For account of Federal Re- For account of other Federal serve Bank of New York. Reserve Banks. Month. Number Number of items. Amount. of items. Amount. January 133 $2,605,561.06 396 $7,465,453.54 February.. 1,004 20,242,314.18 1,311 21,619,722.70 March..:... 84 1,763,414.47 230 4,727,936.26 Ar>ril ... 437 9,687,414.49 591 11,617,300.68 May 1,278 28,839,604.60 1,459 21,526,022.56 June....... 4.025 83,248.507.98 1,947 24,474,515.37 July 1^019 25,012,533.62 1,991 21,921,403.75 August..... 439 12,512,824.39 1,672 19,553,401.32 September. 4,407 62,434 840.29 356 5,628,313.38 October 2,835 50,307 095.52 523 6,524,838.02 November. 3,079 61,395'.915.90 314 7,267, 178.15 December.. 4.476 100,915,574.17 105 593,045.18 Total 23.87' 404,965,600.07 | 10,895 152,919,830. 91 Classification: Import and export 387.550,190.57 111,757,370.47 Domestic 69', 323,528.03 8,370,500.56 Indorsed trade bills of foreign origin 5,755,352.44 2,452,116.94 Bills drawn to furnish dollar exchange.. 1,971.529.03 340,786.94 Domestic trade acceptances 365', 000.00 Total. 461,965,000.67 152,019,830.91 TRADE ACCEPTANCES. Reports from different parts of the country indicate a rapid increase during the year in the use of trade acceptances and, in view of the widespread interest in this subject, this bank has published and distributed to all banks in this district a pamphlet giving Information concerning the advantages to be derived from the substitution of trade acceptances for open book accounts. The great Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT KO. 2 NEW YORK. 265 demand for the pamphlet evidences the consideration now being given by the business interests to the adoption of this system. The Trade Acceptance Council has been organized, composed of representatives from the United States Chamber of Commerce, the American Bankers Association, and the National Association of Credit Men, which plans to inaugurate a campaign of education on the use of trade acceptances. The council has the full support of the Federal Eeserve Bank in this work. UNITED STATES BOND OPERATIONS. Following advice from the Federal Eeserve Board that it would require the Federal Eeserve Banks to purchase on April 1, 1917, United States bonds amounting to $15,000,000, or so much thereof as might be offered for sale on or before March 21 by the Treasurer of the United States, the Federal Eeserve Bank of New York purchased, during the first quarter of 1917, from member banks and in the open market $2,560,000 of United States 2 per cent bonds bearing circulation privilege and has converted $3,552,500 (including bonds held over from 1916) into $1,776,500 30 year 3 per cent conversion bonds, and $1,776,000 one year 3 per cent gold notes of the United States, neither of which has the circulation privilege. No further purchases of the 2 per cent bonds have been made, as the Federal Eeserve Board, on April 18, advised that in view of the coming issue of United States bonds bearing interest at 3J per cent, it would not require the Federal Seserve banks to purchase bonds convertible into obligations bearing only 3 per cent. This was further confirmed by resolutions adopted by the Federal Eeserve Board on June 21. On March 31 the bank purchased from the Government $20,000,000 of 2 per cent certificates of indebtedness maturing June 30, 1917, which were carried to maturity. In connection with its work as fiscal agent in selling later issues of certificates of indebtedness and the two issues of Liberty bonds, referred to elsewhere in this report, the bank has from time to time purchased from holders of such certificates varying amounts which were either carried to maturity, or after a short interval, resold to those from whom purchased. It has also on several occasions purchased direct from the Government certificates of indebtedness payable within a few days, bearing interest at 2 to 4 per cent, the purpose being to avoid constant withdrawals of Government funds on deposit with depositary banks,, The bank purchased Liberty bonds of the first issue amounting to $1,500,000 to be held and delivered to holders of certificates which it issued in denominations $10, five of which could be converted into a $50 bond. Liberty bonds to imim- Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

266 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. portant amounts were also purchased from subscribers to the first issue who had defaulted in their payments. Details of the transactions in United States bonds will be found in the appendix. MUNICIPAL WARRANTS. Municipal warrants, which, during 1915 and 1916 were purchased in substantial volume when the resources of the bank were not being otherwise drawn upon, disappeared almost entirely from its investments during 1917. The following statement records the purchases during the year. For account of For account of Federal Re- other Federal serve Bank of Reserve Month. New York. Banks. Amount. Amount. January $2,700,000 $4,240,000 February.. 2,425,000 3,225,000 May 50,000 25,000 September. 1,000,000 Total.. 0,235,000 7,490,000 Average rate for year, 3.04. FEDERAL RESERVE NOTE ISSUES AND THE ACCUMULATION OF GOLD. The policy of issuing Federal Reserve notes freely and of maintaining the interchangeability of Federal Reserve Bank deposits and notes, which was described in the last two annual reports, has been pursued consistently throughout the year. The amendment to the Federal Reserve Act of June 21 provided, among other things, that all Federal Reserve notes in actual circulation should be included by the bank among its liabilities, and that it should include among its assets the gold held by the Federal Reserve agent as security for such Federal Reserve notes. The gold delivered to the Federal Reserve agent is thus treated as collateral to Federal Reserve notes instead of, as formerly, a payment to reduce the bank's liability, and the Federal Reserve Bank is made joint custodian of the funds so held. Up to June 15 all outstanding Federal Reserve notes of this bank were secured dollar for dollar by gold or gold certificates. On that date, however, rapid increases in the bank's loans and discounts made it desirable to make a partial substitution of commercial paper for gold as security for the Federal Reserve notes, thereby increasing the gold reserve of the bank, and $25,000,000 was thus substituted. On June 22 an additional $75,000,000 was substituted, and since that date, in accordance with the spirit of the amendment above referred to, the gold held by the Federal Reserve Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTBICT NO. 2—NEW YOBK. 267 agent has been maintained in substantially the same proportion to the net liability on Federal Reserve notes as the proportion of gold held by the bank has borne to its deposit liability. The accumulation of gold throughout the year by the issue of Federal Eeserve notes in exchange therefor has added materially to the strength of the bank. To assist in this strengthening process the Federal Eeserve Bank on August 10 invited the cooperation of all the national banks, State banks, and trust companies in the district and offered to pay the cost to such banks of forwarding to it gold or gold certificates and to ship Federal Eeserve notes free of expense to any such bank forwarding gold or gold certificates. Later it also offered for a limited period to accept gold coin at its face value without deduction for loss by abrasion. The response to these offers has been extremely gratifying not only in the amount of gold accumulated but in the splendid cooperation given by banks in the district, member and nonmember alike. Member banks outside of New York City sent in, between August 10 and December 31, gold and gold certificates amounting to $10,776,000. Nonmember banks outside of New York City sent in gold and gold certificates amounting to $9,312,000. The amounts of gold received from the New York City banks were, of course, far larger. Many of the nonmember banks in New York under authority of the amendment to the Federal Eeserve Act, which permitted accounts to be opened for clearing purposes, deposited with the Federal Eeserve Bank large amounts of gold or gold certificates which they had held in their vaults. Arrangements effected in the early autumn by which the Treasury at Washington and the Subtreasury at New York were supplied with Federal Eeserve notes to meet demands for new currency have also assisted materially in the substitution of Federal Eeserve notes for gold certificates in general circulation. The amount of Federal Eeserve notes of this bank in actual circulation at the end of 1916 was $93,426,100. At the end of 1917 the amount in actual circulation was $397,353,805. This large increase does not represent wholly a substitution of Federal Eeserve notes for gold. Owing to the increase in the gold supply of the bank from other sources it is impossible to estimate at all accurately what part of the total was so accumulated. It is evident, however, that a substantial volume of notes has been issued not covered by gold, which therefore constitutes an expansion of our circulating medium. This, of course, is both natural under the circumstances and in accordance with the letter and spirit of the Federal Eeserve Act, since Federal Eeserve notes are, with the exception of gold, the principal expanding and contracting element in our currency. The higher prices for labor and materials and the greater velocity of business Digitized for FRASER 34365°—18 18 http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

268 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. and trade require larger amounts of currency to be carried as till and pocket money. The same demand has manifested itself for silver and other coins. The Federal Reserve Bank issues whatever notes the banks of its district require for use of their customers, but the expansion should be regarded as entirely healthy since no one is compelled to receive Federal Reserve notes in payment of debts and since they are redeemable in gold on demand. The redemption of Federal Reserve notes unfit for circulation since November, 1914, has amounted to $119,141,435. The cost of printing the notes has again increased and is now on the basis of $10.80 per thousand bills as against $10.58 last year. It is interesting to note that while the demand for notes during the latter part of 1916 was heaviest for the $5 denomination, it has since changed so that the tens have been issued in largest amounts and the proportion of twenties issued has distinctly increased. The demand for fifties and hundreds is also heavier, and were notes of denominations of $500, $1,000, $5,000, and $10,000 available, they would doubtless be taken in important amounts by many banks in the larger cities of the district which have need for currency of this size and are, at present, obliged to hold gold certificates and pay them out when necessary. COLLECTIONS AND CLEARINGS, THE COLLECTION SYSTEM. The check collection system described at length in the last annual report has been continued in operation during the year, and the following table shows the various classes and amounts of items handled: [000's omitted in columns headed "Amount."] Items on R F o e e t d s h e e e r r v r a e l R i I n e t e s o e m t r h s v e e o r n d F i b e st a d r n e ic r k a t s s l . i I n t e d m is s t r o ic n t b N a o n . k 2 s . I Y H te o o m r u k s s e C o b l n e a a N n r k i e n w s g . Tr U e n as it u e r d y S c t h a e t c e k s s. banks. Month. 1917. January 658 $3,789 367,754 $173,484 620,476 $122,760 114,978 $383,380 138,716 $35,217 February.. 502 5,324 325,367 169,128 546,298 105,120 81,733 348,895 141,685 39,129 March 587 7,088 406,568 202,489 621,938 145,303 94,961 459,026 135,047 45,165 April 539 7,340 407,718 221,139 702,285 161,683 96,874 670,211 145,586 39,401 May 49' 7,915 421,991 248,645 830,591 186,598 123,702 937,649 205,797 39,771 June 416 11,621 412,261 250,546 859,104 234,054 163,170 1,137,609 201,668 43,346 July 530 7,417 373,514 236,115 866,893 220,080 132,153 1,037,054 227,791 65,037 August 579 11,903 356,429 239,075 914,076 258, 670 129,921 978,327 280,931 100,413 September. 509 8,847 382,888 266,621 883,781 216,268 94,548 869,452 311,473 138,245 October 548 6,555 510,575 325,528 975,647 299,880 132,314 1,859,986 358,626 162,534 November.. 558 8,365 534,942 330,062 967,104 894,848 122,932 1,805,131 442,649 174,127 December.. 460 6,219 586, 907 339,866 1,065,090 913,376 145,124 1,659,628 439, 220 217,073 Total. 6,383 97,3835,086,914 3,002,698 9,853,283|3,758,640 1,432,410 12,146,348J3,029,189 1,099,458 I Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT JSTO. 2—STEW YORK. 269 The collection system was extended on September 10, 1917, to include the collection of notes, drafts, bills of exchange, and other collection items. As the handling of items of this kind presents problems quite different from those involved in handling checks, a service charge of 10 cents per item is made, in addition to such collection charge as may be imposed by the collecting bank. In case a collction item is returned unpaid, a charge of 10 cents is imposed to be paid to the bank presenting the item for payment. No charge, however, has been made for the collection of coupons other than the charge made by the collecting bank plus mail or express charges. As far as possible, items are sent direct to their place of payment, and, when payable outside of the district, the collecting bank is permitted to make remittance either direct to the Federal Eeserve Bank of New York in New York exchange, or, if more convenient, in available exchange, to any other near-by Federal Reserve Bank for the credit of this bank. During the early months of the year the number of banks which agreed to remit to the Federal Reserve Bank of New York at par for items drawn upon them included all but 90 out of the 1,049 banks in the district, and, on April 1 this bank announced its readiness to accept at par, subject to the usual per item charge, checks on every bank in the district. Checks on those banks which did not agree to remit at par were collected through express companies and through local agencies established by the Federal Reserve Bank. A number of banks on which items were at first collected in this manner have since agreed to remit at par, and it is hoped that in the interest of the development of the par collection system, the remainder will also in time adopt the same course. On May 31, this bank announced the completion of arrangements with other Federal Reserve Banks for the issuance and sale by member banks of drafts available for immediate credit at any of the 12 Federal Reserve Banks. Under this arrangement, any member bank may draw its draft on its Federal Reserve Bank and have it made available for immediate credit at par in any of the 12 Federal Reserve cities. Under the regulations of the Federal Reserve Board, the Federal Reserve Bank has throughout the year assessed penalties on member banks which have failed to maintain their reserve deposits with the Federal Reserve Bank at the amount required. The member banks report monthly the average reserve required to be kept by them with the Federal Reserve Bank and impairments of this reserve are ascertained by comparing the figures reported by the banks with the average actual reserve shown by the Federal Reserve Bank's books during such month. The penalty, which the board has fixed at a rate of 2 per cent above the 90-day discount rate, has been at the rate of 6 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

270 ANNUAL KEPORT OF THE FEDERAL RESERVE BOARD. per cent during the year. The amount collected was $18,565.29, and the average number of banks penalized each month, 12. GOLD SETTLEMENT FUND. The operations of the gold settlement fund have become of even greater importance than heretofore in connection with the broadened activities of the Federal Reserve Banks since the entrance of the United States into the war. The banks in other Federal Reserve districts have made payments on account of subscriptions to certificates of indebtedness and Liberty loan bonds, to a very important extent by drawing upon their New York correspondents. Payments by this bank to other Federal Reserve Banks during the year through the gold settlement fund totaled $8,692,024,000, and payments received from other Federal Reserve Banks totaled $8,426,893,000, the net amount paid being $265,131,000. Transfers in immense volume have been made from other Federal Reserve Banks to this bank, both as a natural movement of funds and also for account of the Treasurer of the United States. It seems probable that without the facilities of the gold settlement fund, these heavy transfers could have been accomplished only at considerable expense and with an unfortunate disturbance of domestic exchange at times when it was of the utmost importance that no disturbance should occur. Through the courtesy of the Treasury and subtreasuries these transfers have been made without the shipment of any gold or gold certificates, and at a trifling cost for telegrams and clerical work. The amendments of June 21 provided that the Treasurer of the United States should receive deposits of gold from Federal Reserve Banks or Federal Reserve agents for credit of their accounts with the Federal Reserve Board. The gold settlement fund since June 29 has therefore been carried on the books of the Treasurer of the United States as a deposit repayable in gold to the Federal Reserve Board, which administers the fund. THE TRANSFER SYSTEM. Telegraphic transfers have been made for member banks without limit as to amount and without charge other than the cost of the telegram. That they have become an important part of the exchange operations of the bank, is shown by the following table giving the volume of transactions during the last six months: Daily Daily Month. Da a il m y o a u v n er t. age n av u e m o ra f b g e e r Month. Da a il m y o a u v n er t. age n av u e m o r f a b g e e r transfers. transfers. July $31,801,000 October.., $37,304,000 48 August 28,536,000 November 47,191,000 73 September 30,893,000 December. 50,308,000 70 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 2 NEW YORK. 271 DESIGNATION OF RESERVE CITIES. Under the provisions of section 11 of the Federal Reserve Act, the Federal Reserve Board has designated Buffalo, N. Y., as a reserve city, effective January 1, 1918. RELATIONS WITH MEMBER BANKS. In Federal Reserve District No. 2, including New York State, Fairfield County, Conn., and the following counties of New Jersey: Bergen, Essex, Hudson, Hunterdon, Middlesex, Monmouth, Morris, Passaic, Somerset, Sussex, Union, and Warren, the number of member banks on December 31, 1917, was 667, as compared with 625 on December 31, 1916, the location of the members being as follows: Number Location. of banks. -L Connecticut (Fairfield County) 15 New Jersey 134 New York, Borough of Manhattan 56 New York, elsewhere 462 518 Total 667 During the year 41 State banks and trust companies were admitted to membership, making a total of 43 such members, the names of the institutions and the amount of their gross resources at the time of last available official statement being as follows: Location. Bank or trust company. Resources* Connecticut: Bridgeport Bridgeport Trust Co $7,866,545.08 New Jersey: Montclair Bank of Montclair.. 3,408,669.31 Passaic Passaic Trust & Safe Deposit Co 7,130,181.05 Plainfield Plainfield Trust Co 8,749,434.09 Rahway Rahway Trust Co 398,276.67 New York: Batavia Bank of Genesee 1,151,906.81 Brooklyn Brooklyn Trust Co 80,541,258.38 Do Franklin Trust Co.. 35,397,147.55 Do Manufacturers Trust Co 15,031,812.26 Do Peoples Trust Co 31,376,550.02 Buffalo Buffalo Trust Co 9,624,217.56 Do Citizens Commercial Trust Co 18,971,655.31 Elmira Chemung Canal Trust Co 7,301,857.80 New York City Bank of America 53,142,536.95 Do Bank of the Manhattan Co 77,352,106.80 Do Bankers Trust Co 348, 716,132. 77 Do Central Trust Co 227,145,177.86 Do Columbia Trust Co 116,989,761.33 Do Corn Exchange Bank1 161,838,224.38 Do Equitable Trust Co 308,484,680.75 Do Fidelity Trust Co 15,588,505.06 Do German American Bank 11,743,400.68 Do Germania Bank 9,007,106.55 Do.. Grace & Co.'s Bank, W. R • 6,675.523.47 Do Guaranty Trust Co 701,118,796.37 Do Irving Trust Co.* 39,724,638.23 Bo Mercantile Trust & Deposit Co 7,373,524.48 Do Metropolitan Bank 41,620,741.62 1 Admitted to membership prior to Jan. 1,1916. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

272 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. Location. Bank or trust company. Resources. New York—Continued. New York City. Metropolitan Trust Co $72,199,002.79 Do New York Trust Co 84,935,886.36 Do Pacific Bank 16,866,754.73 Do Scandinavian Trust Co 16,944,327.51 Do Union Trust Co 86,701,578.94 Do United States Mortgage & Trust Co 96,068,096.07 Do United States Trust Co 77,455,086.50 Ogdensburg. St. Lawrence Trust Co. 929,679.49 Oneida Madison County Trust & Deposit Co 2,224,325.64 Rome Rome Trust Co.. 3,627,405.80 Syracuse City Bank.. 8,239,911.66 Utica Citizens Trust Co 10,641,931.22 Do Oneida County Trust Co 2,428, 746. 94 Do , Utica Trust & Deposit Co 11,850,975.96 Watertown Northern New York Trust Co 7,151,603.95 Total 2,851,735,682.75 The payments to capital stock of the Federal Eeserve Bank made by these institutions amounted to $6,773,700; their reserve deposits on December 31, 1917, were $241,680,500.43 and the amount of their rediscounts and loans with the Federal Keserve Bank on that date were $69,693,287.12. Ten national banks in the district were liquidated during the year, of which five went out of business for one reason or another and five were converted into trust companies. Twelve new national banks have commenced business in the district this year. The relations with member banks during the year have been more active, not only owing to the transactions which the Federal Eeserve Bank has had with each member, as well as nonmember, bank in connection with subscriptions to Liberty bonds and with many of them in connection with sales of certificates of indebtedness, but also owing to the increasing number of member banks which have had occasion to rediscount or obtain advances during the year, the total number of such banks having been 322. With the New York City banks the relations and cooperation have been particularly close. New York City being the principal money market and the financial center of the country, it became apparent when the United States entered the war that the banks of this city not only had a duty to perform to the Government and to their own customers, but had a responsibility to the whole country as well. They have recognized and carried out these obligations in a spirit of wholehearted patriotism, and frequently at a sacrifice of normal banking profits. By close cooperation among all the important banks of the city, every requirement of the Government has been promptly and fully met, and a generous amount of the resources of these banks has been placed at the disposal of the Federal Reserve Bank for the general stabilization of the money market. Had this spirit and this recognition of responsibility been lacking among the New York City Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 2—NEW YORK. 273 bankers, the heavy financial burdens imposed upon the banking system could not have been discharged without both inconvenience and embarrassment to the Government and serious disturbance to the money markets and the business of the country. Joint meetings of the clearing house committee and the executive committee of the directors of this bank have been held periodically, and this bank has been appointed as settling agent by every member of the New York Clearing House, including the Subtreasury of the United States, thereby enabling all clearing-house balances to be settled on the books of this bank, without the use of any currency whatever in such settlements. This arrangement is of great value to the Federal Eeserve Bank in preventing the drain on its gold which would otherwise occur. The machinery of the Federal Reserve Bank for the rapid creation of credit in hitherto unprecedented volume having been tested during both the first and the second Liberty loan financing periods, there seems to be no longer any inclination to doubt the practical value of the system; on the contrary, among both the country and the city banks there seems to be a general recognition of the indispensability of the system to our banks in their conduct of the immense operations incident to the financing of the war. RELATIONS WITH NONMEMBER BANKS. The relations with the State institutions, as indicated in the foregoing paragraph, have also become active through transactions with many of them in certificates of indebtedness and with all of them in Libert}^ bonds. The transactions of the bank acting as fiscal agent of the Government have been on exactly the same basis with nonmember as with member banks, and no distinction has been made" between the two classes in respect of the deposit of Government funds. Under authority of the Federal Reserve Board, a Federal Reserve Bank is authorized to accept from member banks paper discounted with them by nonmember banks, provided it was given to purchase or carry Liberty bonds or certificates of indebtedness, but only a very small volume of such paper has been presented to this bank for discount. Nonmember banks have also cooperated cordially and effectively with the Federal Reserve Bank by turning in gold coin and certificates in exchange for Federal Reserve notes. The only note of discord in the relations with State institutions has been that which manifested itself in the development of the collection system. As already stated, a small number of State institutions are unwilling to remit at par to this bank for checks drawn upon them, and this bank, much to its regret, has been obliged to collect such checks at par either through express companies or by the establishment of local collecting agencies. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

274 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. The amendment of June 21, 1917, permitted nonmembers to open acounts for clearing purposes with the Federal Eeserve Bank and enabled them to contribute their gold to the strength of the bank. Balances thus carried with the Federal Reserve Bank at one time aggregated $84,268,259.73, but the entrance into the system of the larger institutions reduced the amount of such balances to $10,- 317,630.16 on December 31. The entrance of the United States into the war has effected a great change in the attitude of State banks and trust companies toward membership in the Federal Reserve system. On August 1, the Northern New York Trust Co. of Watertown, N. Y., and on September 28, 1917, the St. Lawrence Trust Co. of Ogdensburg, N. Y., became members, and following the entrance of the Guaranty Trust Co. of New York City, which joined on October 4, the great majority of the larger State institutions in New York City as well as a number from other places in the district have become members. Several factors contributed to this important movement: First, the amendment of June 21 under which the rights and duties of State institutions as members of the system were prescribed by law instead of being left to regulation by the Federal Reserve Board. Second, the opinion of the Attorney General of the United States, dated September 10, to the effect that State institutions joining the system were not subject to the restrictions of section 8 of the Clayton Act. Third, and by far the most important, the proclamation of the President of October 13, appealing to State institutions to join the system as a national duty. Although the majority of the larger institutions have already joined the system there are, nevertheless, approximately 260 State banks and trust companies in the district with sufficient capital to qualify them for membership. Many of them are actively considering applying for membership in the near future, and it is hoped that before long the great majority of the State institutions will join, thereby coordinating and concentrating the entire banking power of the district and enabling every member bank in the district to give the fullest cooperation and assistance to the Government in financing the war. The following extract from the report of the executive committee of the United States Trust Co. of New York City to its board of trustees is typical of the patriotic attitude which has led so many of the larger institutions to join the system: During this company's entire corporate existence we have steadfastly adhered, in theory and in practice, to what we believed to be the fundamental distinction between a trust company and a bank. This distinction has heretofore rendered direct membership in the admirable Federal Reserve system Digitized fonr eFiRthAeSrE Rn ecessary nor helpful to us. Our designated depositary banks have http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 2 NEW YORK. 275 fully represented ITS in that system, and our business being strictly confined to that of a trust company as distinguished from the general banking business, we have heretofore considered only our own interest in determining the question of membership in the system. The situation is now, however, radically changed. The appeal of President Wilson and the urgent money needs of the country make it the duty of every financial institution to come forward with all the moral as well as financial aid which it can lawfully furnish. Whether the facilities afforded by membership in the reserve bank are useful to us or not, whether the conditions of membership would, having in ATiew the restricted character of our business, in fact result in a slight pecuniary loss to us or not, such considerations are in our opinion as of no weight whatever, in view of the vital importance to our country under existing conditions of omitting no act which can, either directly or morally, either by the furnishing of resources or the exhibition of a spirit of hearty cooperation, tend to strengthen the financial system of the Nation. RELATIONS WITH FOREIGN BANKS. Under authority of paragraph (e) of section 14 of the act, and with the approval of the Federal Reserve Board, the Federal Reserve Bank of New York on May 3, 1917, concluded reciprocal arrangements with the Bank of England, appointing the latter its correspondent and agent. On June 20, 1917, the Federal Reserve Bank under its agreement with the Bank of England made payments in New York amounting to $52,500,000 against gold in like amount earmarked and held in London by the Bank of England for the account of the Federal Reserve Bank of New York. Pursuant to arrangements with other Federal Reserve Banks and with the approval of the Federal Reserve Board, participations in this transaction were allotted to other Federal Reserve Banks to the amount of $34,387,500. On February 24 this bank applied to the Federal Reserve Board for authority to appoint the Bank of France its correspondent and agent, and approval was granted on February 26. Correspondence and arrangements of details are in progress looking to the completion of the relationship contemplated. On August 23, with the approval of the Federal Reserve Board, a preliminary agreement was concluded between the Federal Reserve Bank of New York and the Bank of Italy providing that each should act as a correspondent of the other, which was confirmed by the board of directors of this bank on September 5 and by the superior council of the Bank of Italy on September 24. Negotiations are in progress for the arrangement of reciprocal relations with certain other foreign banks. THE FISCAL AGENCY OF THE UNITED STATES. During the early part of 1917 the operations of this bank as fiscal agent and depositary of the United States were limited as before to Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

276 ANNUAL, REPORT OF THE FEDERAL RESERVE BOARD. receiving from Government collectors of customs and internal revenue their various receipts and paying checks and Avarrants drawn upon the Treasurer of the United States and coupons of United States bonds. Immediately following the entrance of the United States into the wrar, however, the functions and responsibilities of the Federal Reserve Bank as fiscal agent of the United States were enlarged at the request of the Secretary of the Treasury to include the following: (a) The sale and redemption of certificates of indebtedness; (b) The sale and delivery of Liberty bonds, the payment of coupons thereon, the exchange of bonds of small denomination for bonds of large denomination, and vice versa, and the conversion of bonds of one issue into bonds of another issue; (c) The administration of deposits of the United States Government in depositary banks in this district resulting from sales of certificates and bonds, and the examination, approval, and custody of the- securities pledged to secure such deposits; (d) Later, the sale of war-savings stamps and thrift stamps. At all times throughout the period in which the bank has performed these functions and undertaken these responsibilities as agent of the Treasury Department its work has been lightened and its burdens made possible by the vigorous and cooperative way in which the bank has been supported in the various requests and recommendations which it has made. The method of conducting these operations will be described in the succeeding paragraphs. CERTIFICATES OF INDEBTEDNESS. On March 27 the Secretary of the Treasury offered to Federal Eeserve Banks $50,000,000 certificates of indebtedness due June 30, 1917, at 2 per cent. This bank subscribed for $25,000,000 and was allotted $20,000,000, the balance being taken by the other reserve banks. On April 19 the Secretary of the Treasury offered for subscription through Federal Reserve Banks $200,000,000 of 3 per cent certificates of indebtedness due June 30, 1917, for which subscriptions were received in this district aggregating $135,650,000, and a similar amount allotted. This issue, like some of the later ones, was oversubscribed, and $68,205,000 was issued beyond the original amount offered. In subsequent issues allotments were restricted to the amount originally offered. From the following table it will be seen that, out of a total of $3,843,501,000 offered, the subscriptions received through this bank amounted to 67 per cent and the amount allotted through this bank amounted to 64 per cent of the total. The largest volume of Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 2 NEW YORK. 277 these certificates outstanding at any one time in this district during the first Liberty loan financing period was $479,962,000, and during the second Liberty loan financing period was $1,467,543,000. The cooperation of the banks in this district, particularly of those in New York City, in purchasing these certificates, was of a most gratifying character. Individual bank subscriptions during the second Liberty loan financing period ran as high as $145,000,000 and $150,000,000. Of the 1,076 banks (not including savings banks) outside of New York City, 308 purchased certificates of indebtedness, but of these only about one-half were what might be termed regular purchasers. The others participated in only one or two of the issues. United States certificates of indebtedness issued during 1917. Amount Amount subscribed allotted Rate of Maturity- Total amount through Fed- through Fed- Date of issue. interest. date. of issue. eral Reserve eral Reserve Bank of Bank of New York. New York. Per cent. Mar. 31.. 2 June 30,1917 $50,000,000 $25,000,000 1 $20,000,000 Apr. 25.. 3 do...— 268,205,000 135,650,000 135,650,000 May 10.. 3 July 17,1917 200,000,000 98,512,000 98,512,000 May 25.. H July 30,1917 200,000,000 175,231,000 125,300,000 June 8... 3i do.. 200,000,000 116,000,000 100,500,000 Aug. 9... Nov. 15,1917 300,000,000 211,054,000 175,000,000 Aug. 28.. Nov. 30,1917 250,000,000 188,837,000 152,938,000 Sept. 17. Dec. 15,1917 300,000,000 204,347,000 204,347,000 Sept. 26. do 400,000,000 212,100,000 212,100,000 Oct. 18.. Nov. 22,1917 300,000,000 179,475,000 179,475,000 Oct. 24.. Dec. 15,1917 685,296,000 543,683,000 543,683,000 Nov. 30. June 25,1918 690,000,000 494,070,500 494,070,500 Total. 3,843,501,000 2,578,959,500 2,441,575,500 1 Not offered for public subscription, but taken by Federal Reserve Bank of New York. In order that payments for the large amounts of certificates of indebtedness subscribed for in this district might not disturb the banking situation, arrangements were made beginning with the issue of April 25 to redeposit as large a portion as possible of the funds paid in. This, in effect, amounted to a payment for the certificates by credit on the books of the subscribing banks, and in later issues this was the practice actually pursued. In this manner disturbance to the money market from the absorption of this large volume of certificates was reduced to a minimum. The Federal Reserve Bank itself purchased from time to time various amounts of these certificates of indebtedness from banks and bankers, and on several occasions advanced substantial amounts to the Treasury for temporary requirements through the purchase of special certificates running f or a few days, not included in the totals above referred to. The sale of certificates of indebtedness in anticipation of both Liberty loans enabled the banks to create the short credit required by the Government pending the creation of long-time credit through the Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

278 ANNUAL REPOBT OF THE FEDERAL RESERVE BOARD. purchase of bonds by investors. With each issue of bonds the short bank credits were, in effect, converted into long investment credits. FIRST LIBERTY LOAN. On May 3 the Secretary of the Treasury announced an issue of $2,000,000,000 3£ per cent 15-30 year Liberty loan bonds exempt from all taxes, except estate or inheritance taxes, imposed by authority of the United States or its possessions or by any State or local taxing authorities. In making the announcement the Secretary advised that the subscription books would close on June 15, and requested the Federal Keserve Banks in each district to act as a central agency for receiving subscriptions, taking payment of subscriptions and delivering the bonds after allotment. He also requested the Federal Reserve Banks to form an effective organization and carry on an energetic campaign for the successful flotation of the loan. The governor of the Federal Reserve Bank of New York appointed a Liberty loan committee for the district, composed of 12 New York City bank presidents and private bankers, together with an alternate for each. At the first meeting of this committee, on May 7, the governor of the Federal Reserve Bank was appointed chairman, the secretary of the bank was appointed secretary, and a plan of organization was determined upon which involved the appointment of subcommittees on distribution, on publicity, and on the receipt and payment of subscriptions. An executive manager was also appointed. The committee met daily except on Saturdays throughout the campaign, and on several occasions, at the request of the Treasury Department, sent subcommittees or representatives to Washington to confer upon some of the many details which were required to be settled in connection with securing and receiving subscriptions and delivering the bonds. The committee on distribution consisted of 12 members, and owing to the active nature of the work assigned to this committee alternates were also appointed. The chairman of the committee was a member of the Liberty loan committee. All of the members were partners of leading bond houses or officers of banks or corporations having bond departments. This committee had charge of organizing the campaign to obtain subscriptions to the loan throughout the entire district, and met daily during the campaign. The committee on publicity carried on a well-organized, vigorous, and effective publicity campaign, reaching all parts of the district, and included in its activities the organization of meetings, the creation of a speakers' bureau, which supplied speakers for over 1,000 meetings, the use of large quantities of newspaper and periodical Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 2—NEW YORK. 279 news and advertising space, largely contributed by advertisers, and the distribution of posters and other literature. Most of the staff of the publicity department were volunteers from banks, banking houses, and newspapers, and the cooperation of many and varied interests was given ungrudgingly to further the efforts of the committee. The committee on receipt and payment of subscriptions organized a staff of about 300 men and women loaned by New York banks, bond houses, and insurance companies to serve during the period of the campaign and of the subscription payments. This force worked tirelessly in handling the immense amount of detail incidental to the receipt, allotment, and adjustment of subscriptions and the receipt of payments. Some confusion was apparent at times, owing to lack of opportunity for careful organization, to the fact that the entire force were volunteers, and to the unfamiliarity of most of the banks with transactions of the character involved; but, considering the magnitude of the task and the circumstances attending it, the work was handled with reasonable promptness and efficiency. The committee received subscriptions amounting to $1,186,788,400 from 978,959 subscribers. Interim certificates were issued as partial or full payment was made on the bonds, the total number of pieces of such certificates being 2,090,524. The total number of pieces of bonds of the first Liberty loan issued to December 31 was 1,181,469. During the campaign it became apparent that the department dealing with the subscriptions to and deliveries of bonds should become an integral part of the Federal Reserve Bank, and on October 1 the Federal Reserve Bank took over the department, released most of the staff to the institutions by which they had been loaned, and began the organization of a permanent staff. Early in the campaign an informal statement was issued from the Treasury Department indicating the extent to which subscriptions might be expected from each of the Federal Reserve districts on the basis of their respective banking resources. Although the quota of subscriptions expected from the Second Federal Reserve District was $600,000,000, one of the early decisions of the Liberty loan committee was to establish $1,000,000,000 as the minimum amount of subscriptions which the committee should endeavor to obtain in this district, and the whole campaign was organized to this end. The campaign fell naturally into two divisions: (a) New York City; (b) places outside of New York City. CAMPAIGN IN NEW YOEK CITY. In New York City the campaign was organized largely along professional and occupational lines, and the following committees were Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

280 ANNUAL REPORT OF THE FEDEEAL RESERVE BOARD. appointed, each composed of leading men in their respective occupations : National banks. Engineers. State banks. Architects. Trust companies. Physicians. Savings banks. Dentists. Railroads. Savings and loan associations. Industrial corporations. Sale of " baby " bonds. Public utilities. Real estate. Insurance. Automobile trade. Municipal employees. Wholesale merchants. Stock exchange houses. Retail merchants. Professions. Hotels. Lawyers. Printing houses. These committees were composed entirely of volunteer workers, a very large number of whom participated actively in the campaign. To supplement the work of these occupational committees, a group of about 400 bond salesmen organized in teams with captains, made a house-to-house canvass in New York City with substantial results. The total amount subscribed in New York City was $987,269,450. CAMPAIGN OUTSIDE OF NEW YORK CITY. To assist and advise in the compaign outside of New York City five subcommittees of the distribution committee were appointed, their respective territories being eastern New York, central New York, western New York, northern New Jersey, and Fairfield County, Conn. These five district committees were composed of partners of leading bond houses. They did not become responsible for or undertake local selling campaigns, but acted in an advisory capacity, assisted in organizing local committees and maintained direct contact between the district headquarters at the Federal Reserve Bank and the various local committees, helped the work of the local committees, and furnished them all the literature and material available as the campaign progressed. Owing to the compactness of the Second Federal Reserve district it was possible to have this form of organization, permitting direct contact with headquarters instead of contact through the medium of subcommittees, and experience has demonstrated its effectiveness and desirability where possible. The governor of the Federal Reserve Bank wrote a letter to the banks in this district outside of New York City, asking their officers, in consultation with other bankers in the same place, to undertake the formation of local committees to secure subscriptions for the bonds. Each locality was advised of the amount of subscriptions which it was expected to obtain, the amount being based largely on local bank- Digitized fori nFRgA SreEsRo urces. These local quotas proved helpful to the local comhttp://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 2 NEW YORK. 281 mittees by giving them a definite figure toward which to direct their campaigns. No uniform plan of organization was proposed. Each committee was free to operate in the manner which it considered most effective, some making short campaigns after thorough advance preparation, while others carried on the campaign during the entire selling period ending June 15. In all some 231 local Liberty loan committees were formed, nearly all of which worked wTith remarkable zest and enthusiasm, and a large number of the localities covered by these committees exceeded the quotas assigned to them by the Federal Reserve Bank, based on the expectation of raising $1,000,000,000 in the Second Federal Reserve district. The total amount subscribed outside of New York City was $199,518,950. m THE CAMPAIGN IN GENERAL. The progress of the organization at first was hampered by lack of opportunity for preliminary preparation and to unavoidable delay in settling important details of the issue until the campaign had been in progress for some time. These handicaps were in large measure overcome and an effective organization was developed through the large number of efficient and experienced men in every part of the district who were willing, as a patriotic duty, to devote their whole time and energy to the campaign. Early in the campaign a women's committee for the district was organized in cooperation with the women's Liberty loan committee, and headquarters wTere established in New York. An organization was effected for the canvass of New York City, as well as in some of the larger places outside of New York City, and very effective work was done by the committee and by a large number of women who volunteered to assist in obtaining subscriptions. On June 10 the Treasury Department began the publication of the amount of subscriptions reported in each of the 12 Federal Reserve districts. The first publication, which was only one week before the close of the campaign, showed a total of $1,300,000,000, the subscriptions reported for this district being $588,000,000. At the same time publicity was given to the subscriptions reported in the various localities in this district. Although undoubtedly the figures published by the Treasury Department were below the amount of subscriptions which had actually been made up to the date of publication, owing to the slowness with which returns were made by the banks outside of the Federal Reserve cities, the publicity which was given to district and local quotas stimulated very great activity throughout the last week of the campaign, and when the books closed in this district it was found that the total subscriptions Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

282 ANNUAL BEPORT OF THE FEDERAL RESERVE BOARD. had exceeded the $1,000,000,000 aimed at and actually amounted to $1,186,677,400., out of a total of $3,035,226,850 for the entire country. The following table shows the number of subscribers, the amount of subscriptions, and the allotments actually made, subdivided into five different classes graded as to size of subscription. Number of Amount of Amount. subscribers. subscriptions. Allotment. $50 co $10,000 973,614 $274,019,550 $274,019,550 $ $5 1 0 0 , , 0 0 3 5 0 0 t t o o $ $ 1 5 0 0 0 ,0 ,0 0 0 0 0 .. . , . 3,5 7 8 7 2 8 172,693,700 127,460,850 $100,050 to $250,000 285 79,173,300 35,628,000 Above $250,000 700 660,901,850 180,723,250 Total 978,959 1,186,788,400 617,831,650 The banks of the district, almost without exception, threw themselves into the campaign with energy and enthusiasm, working early and late to obtain subscriptions, agreeing to loan at moderate rates to bond purchasers who wished to borrow, operating for purchasers of small denomination bonds, partial payment plans which entailed much additional clerical work and supervision, taking custody of bonds for safekeeping, and subscribing themselves for substantial amounts of bonds. Without such complete cooperation on the part of the banks the great success of the loan could not have been achieved. The bond houses placed themselves at the disposal of the Liberty loan committee, and the general organization of the selling campaign was placed almost wholly in the hands of the experienced bond men who thus volunteered. Besides organizing the campaign they also secured a large volume of subscriptions from their clients. Employers of labor in industrial centers and elsewhere cooperated by bringing the bonds to the attention of their employees, and providing partial payment plans by which small denomination bonds could be purchased and paid for gradually out of salaries or wages. The campaign called forth a patriotic effort of great intensity on the part of many thousands of volunteer workers who devoted themselves to the one purpose of making the loan a tremendous success. SECOND LIBERTY LOAN. On September 27 the Secretary of the Treasury announced that he would offer for subscription between October 1 and 27 three billion or more dollars of United States 4 per cent, 10-25 year, convertible gold bonds due November 15, 1942, the exact amount of bonds to be issued depending on the amount of subscriptions received. He stated that he hoped subscriptions in excess of $5,000,000,000 would be received from not less than 10,000,000 subscribers, and that bonds would be allotted in excess of $3,000,000,000 to the extent of not Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 2—NEW YOBK. 283 over one-half of the amount by which the subscriptions exceeded $3,000,000,000. The new series of bonds were made subject to (a) State or inheritance taxes, (b) graduated additional income taxes, commonly known as surtaxes, and (c) excess profits and war profits taxes now or hereafter imposed by the United States. As before, informal apportionment was made by the Treasury Department of the amounts expected to be raised in the various districts, the quota of the second district being a minimum of $900,- 000,000 (proportionate share of $3,000,000,000) and a maximum of $1,500,000,000 (proportionate share of $5,000,000,000). The Liberty loan committee determined from the outset to endeavor to reach the maximum figure set for the district. The headquarters organization was continued for the second Liberty loan campaign with certain changes which made for greater effectiveness and with great expansion in the number of committees and number of workers who volunteered their services. The Liberty loan committee was enlarged from 12 to 15, and the distribution committee from 12 to 22. The publicity committee was not reappointed, but its work was carried on by a director of publicity. The committee for handling bond subscriptions was not reappointed, as its work had been assumed by the Federal Eeserve Bank. No executive manager was appointed, but an executive secretary was appointed for the distribution committee and the executive committee of the distribution committee was enlarged to include the director of publicity, with a view to obtaining coordination at headquarters of all efforts at distribution. The campaign, as before, was organized in two main subdivisions: (a) New York City; (b) the district outside of New York City. THE CAMPAIGN IN NEW YORK CITY. The work in New York City was organized on the same general lines as in the preceding campaign, but with ample time for preparation the field was covered much more intensively. The various occupational committees of the first campaign were increased, and with the assistance of an advisory trades committee the following committees "were organized and active during the campaign, covering over 30,000 concerns in Greater New York through the medium of approximately 15,000 volunteer workers: Art dealers, art publishers, etc. Books. Automobile and allied. Brewers. Bakers and confectioners. Butter, eggs, and cheese. Banks, national. Caps. Banks, State. Carpenters. Banks, savings. Carpet and rug. Blanket. Cement workers. Digitized for FRASE3R43 65°—18 19 http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

284 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. Chemical and drug. Paints and varnishes. Children's dress manufacturers. Paper boxmakers. China, toy, and house furnishing. Paper manufacturers. Cloaks, suits, and shirt manufacturers. Perfumery and soap. Coal. Plastering. Collars1 and cuffs. Plumbers. Corset. Poultry. Cotton goods. Produce and fruits. Decorators. Professions. Department stores. Public utilities. Distillers. Real estate. Dry dock and repair company of Refrigerator manufacturers. Brooklyn. Restaurants. Electrical. Retal grocers. Elevator manufacturers. Ribbon. Fish. Roofers and sheet metal. Fur. Rubber. Furniture. Savings bank. General contractors. Shipping, import and export. Glove. Shirts, pajamas, and boys' blouses. Hardware. Shoe retailers and jobbers. Hats. Shoes, wholesale and retail. Hide and leather. Silk and velvets. Hotels. Spice. Industrial committee. Sporting goods'. Insurance companies. Stationery. Iron League. Steam and hot water. Jewelry. Steam railroads. Laces, trimmings1, etc. Storage warehouse and van owners Ladies' garments. trade. Leather-glove industry. Sugar trade. Leather goods (small), trunks and Suspenders and garters. bags. Talking machines, pianos, and musical Lighting fixtures. instruments. Linen. Tile. Lumber. Tobacco. Machinery and machine tool. Toilet preparations, specialties. Marble. Trust companies. Meat, wholesale and retail. Umbrellas and cane. Men's clothing. Upholstery and lace curtains. Mens' neckwear. Wall paper. Men's underwear. Wholesale grocers. Metal ceiling. Wine. Metal doors and windows. Wire workers. Metal furring. Women's cotton and silk underwear, Milk. Women's dress and waist industry. Mosaic. Women's hosiery and knit underwear. Municipal employees. Women's millinerv. New York Cotton Exchange. Women's neckwear. New York Produce Exchange. Women's organizations4. New York Stock Exchange, houses. Woodworkers. Notion. Woolens and worsted. Ornamental iron workers. Wrapper and kimono manufacturers. Painters. Yarns and art goods. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 2—NEW YORK. 285 A house-to-house canvass of Greater New York was conducted by the metropolitan canvass committee with the assistance of some 35,000 volunteer workers. The entire city was divided among these workers on the basis of election districts and the workers in each election district were furnished with the names of all the voters in the district. The results of this house-to-house campaign were far more effective than those accomplished in the first campaign with less detailed preparation. A number of booths were operated in public squares, on crowded street corners, and in hotels, which served not only as centers for the receipt of subscriptions and the sale of $50 and $100 bonds, but also as places from which addresses could be made. In order that subscriptions received at public meetings, booths and theaters, as well as by the metropolitan canvass committee, might be promptly allocated to banks situated near the residences of subscribers, a subscription department was organized which at one time had as many as 150 workers. This department distributed a very large number of subscriptions, avoided much confusion and congestion which would otherwise have occurred, and made many subscriptions effective which otherwise would not have been followed up. A very successful parade of trade and other organizations, with about 50,000 people in line, and led by a British tank, was held on the day after Liberty Loan Day. The German submarine " TJC-5," which had been captured by the British and sent over for exhibition during the campaign, was set up in Central Park, rechristened " U-Buy-A-Bond," and visited by hundreds of thousands of people. The total subscriptions received in New York City was $1,140,- 629,300. THE CAMPAIGN OUTSIDE OF NEW YOKK CITY. The general plan of organization which had hitherto prevailed was continued during the second Liberty loan campaign. In order to assist the various local organizations more effectively, the five district committees at headquarters were increased to eight, each committee having a somewhat smaller territory to cover. Through these eight district committees the central Liberty loan committee and the headquarters organization were kept in close touch with the work in every part of the district, and invaluable assistance was rendered in determining the membership of the local committees, all of which were appointed by the chairman of the central Liberty loan committee. The number of local committees operating in the second compaign was about 1,050, as compared with 231 in the first campaign. As a suggestion to the local committees a plan book was issued outlining certain methods of operation which had been found effective. Partial payment cards were furnished upon request to Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

286 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. local committees for use in industrial establishments and banks. As in the first campaign, quotas were assigned to each locality, and local publicity given to the progress in filling these quotas resulted in many cases in rivalries between places and an increased volume of subscriptions. Each local committee laid out its plan of organization along the lines which it considered best adapted to its territory, and while a great variety of appeals was made through meetings, advertising, circularizing, and otherwise, the most effective method everywhere of securing actual subscriptions appeared to be a personal canvass properly planned and directed. The total subscriptions received from places outside of New York City was $409,824,200. THE CAMPAIGN IN GENERAL. The publicity work during the second Liberty loan compaign was under a director of publicity and subdivided into four bureaus— news, advertising, features, and service. The news bureau placed news items and articles with newspapers and periodicals of all kinds. It obtained approximately 16,000 columns of newspaper publicity, exclusive of advertising. Among the 2,436 newspapers of the district it placed 41,800 articles, 2,752 editorials, 1,116 cartoons, 489 photographs, and 2,000 articles in foreign language newspapers. The bureau had a staff of 40 well-known writers who volunteered their services. The advertising bureau obtained 1,563 pages of paid newspaper advertising, of which 353 were in New York City. This space was obtained entirely from advertisers who either donated space they had themselves contracted for, or furnished the means of obtaining space, no space being requested from the newspapers themselves. Much of the advertising was illustrated. Forty-five million pieces of literature were distributed. Eighty thousand square feet of electrical and painted sign space was donated, a 24-foot poster prepared in cooperation with the national organization was pasted upon all unused billboards of suitable size in the district, and various other novel devices were employed. The feature bureau dealt with the publicity and educational work in theaters and moving-picture houses, among labor organizations, boards of commerce and trade, clubs, societies and fraternal organizations, churches and church societies, farming and agricultural societies, political parties, and foreign language organizations and newspapers. It also arranged the Liberty loan parade in New York City, the exhibition of the captured German U-boat and the British tank, and the flight of aeroplanes over New York City. The service bureau had charge of the routine wTork of the publicity, including the purchasing, information, stenographic, bookkeeping, Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 2—NEW YORK. 287 filing, auditing, poster and literature distribution, shipping, messengers, mail, and telephone departments. The speakers' bureau was continued during the campaign as an independent organization. It had about 150 speakers and furnished speakers for about 1,000 meetings, indoors and outdoors, both in New York City and in other parts of the State. As in the first campaign the four-minute men rendered invaluable service. The commissioner of education in New York State appointed two representatives to act at headquarters during the campaign, and through the cooperation of the school authorities, State and local, a very effective campaign was carried on among the teachers and pupils of the schools of New York State. The women's committee in the second campaign had its headquarters with the men's committees, and a much more detailed organization was perfected. The women's Liberty loan committee, with headquarters at Washington, appointed a chairman for the district and chairmen for each of the three States represented in the district, although in the case of chairmen for New Jersey and Connecticut, parts of their districts were outside of the Second Federal Reserve District. The women not only carried on an effective campaign in New York City, but formed committees in 479 other places outside of New York City, and, although organized separately, cooperated harmoniously with the men's committees throughout the campaign and secured subscriptions in excess of $41,000,000. The campaign opened October 1 and closed October 27, and was therefore about two weeks shorter than the preceding campaign. It soon became evident that in order to secure $1,500,000,000 of subscriptions, the maximum amount assigned to this district, it would be necessary for a considerable volume of the subscriptions to be carried by credit. Accordingly, the phrase " borrow and buy " was used freely in all parts of the district, and the banks in New York City and many other places cooperated generously by offering to make loans on the bonds at the coupon rate of interest. It was felt that the obligation of the borrowers to pay off their loans on Liberty bonds during the months succeeding the campaign would be an important stimulus toward effecting the necessary savings. As in the preceding campaign, the central Liberty loan committee and the distribution committee at headquarters met daily, and the staff at headquarters was increased greatly over that of the preceding campaign. The banks and bond houses throughout the district again gave the heartiest cooperation. Almost the entire work throughout the district was carried on by volunteers who labored with untiring energy and zeal to make the loan a success. The number of workers throughout the district was probably over 100,000, and their devo- Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

288 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. tion to the cause in which they were enlisted was inspiring and beyond all praise. The publication of the subscriptions received in the 12 Federal Reserve districts was begun by the Treasury Department on October 15. As before, reports of subscriptions came in slowly until the last week, but the early publication of the subscriptions received as compared with the subscriptions expected was given much publicity and attention in the newspapers, and undoubtedly had the effect of stimulating rivalry between the various districts and greatly increasing the amount of subscriptions received. The subscriptions received from soldiers and sailors, largely on the partial-payment plan, aggregating $53,000,000, appeared as part of the subscriptions received in this district, since whenever necessary they were financed, at the request of the Secretary of the Treasury, through a group of New York banks. On October 15, the Treasury Department began to furnish this bank with actual bonds in denominations of $50, $100, $500, and $1,000 for sale over the counter during the campaign. About $59,- 000,000 worth of these bonds were sold in this district during the campaign and a much larger amount could have been sold had the bonds been available. The total amount of subscriptions received in this district was $1,550,453,000, and the total number of subscribers 2,178,359, the distribution being as follows: Size of subscriptions. Number of su A b m sc o ri u b n e t d. Allotment. subscribers. $50 to $10,000 2,170,201 $441,100,700 $441,001,200 $10,050 to $50,000... 5,889 168,326, 200 168,326,200 $50,050 to $100,000.. 1,099 100, 722,650 90, 790,900 $100,050 to $200,000. 414 68,166,700 51,374,800 Above $200,000 756 772,136,750 412,874,350 Total 2,178,359 1,550,453,000 1,164,367,450 On October 27, at the close of the campaign, the central Liberty loan committee issued the following statement which accurately summarizes the campaign: The second Liberty loan has been a complete success. How high the oversubscription will go can not be known for several days. It is estimated that the total subscriptions in the Second Federal Reserve District will be in excess of $1,500,000,000, and what is equally important, the total number of subscribers in this Second Federal Reserve District is greatly in excess of the number of subscribers to the first loan. Both in the total amount received and in the number of subscribers, the results are beyond our expectations. The reports from the other Federal Reserve districts would indicate a similar surpassing of the estimates. This great success of the loan has been due to two factors. The first is the spontaneous outburst of patriotic feeling and effort that has been common to the whole country. The second is the excellent work of the organizations in Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 2—NEW YORK. 289 every Federal Reserve district. Without this latter the campaign could not possibly have gained its stupendous success. Naturally our own observation has covered particularly the Second Federal Reserve District. As to this we desire to go on record as stating that we have never before witnessed such an extraordinary response in the way of organized, effective work, and unremitting, intelligent effort. From the moment the campaign started this spirit was manifest, and as time went on it daily grew in loyalty and intensity. The record which the Second Reserve District has made is, indeed, a proud one, and it is a record achieved by the united effort of all—by the villages and hamlets throughout the State as much as by the larger towns and cities. To all the workers who have thus made this result possible we wish publicly to make this expression of our appreciation. Of greater import even than the securing of a great loan for the Government has been this unparallel evidence of a Nation bound together and animated with a single spirit of mutual good-will and devotion to the country. RECEIPTS AND DELIVERIES. The receipt of subscriptions and payments for the second Libertyloan was handled by the officers and about 150 permanent employees of the Federal Reserve Bank. Owing to arrangements which had been made to print the bonds more rapidly no interim certificates were issued in connection with the second Liberty loan, and the work of the bond-issue division of the bank was accordingly much simplified. The terms of payment prescribed by the Treasury Department were as follows: Two per cent with application; 18 per cent on November 15, 1917; 40 per cent on December 15, 1917; 40 per cent on January 15, 1918. From November 15 to 19 the following payments for bonds were received: In full: By banks $807, 858,086 Individuals 15,010, 080 Cash sales during campaign 59,051,300 881, 919, 866 20 per cent payments 67, 320,114 949, 239, 980 These payments were made in the following manner: By book credit 687, 741, 746 By Treasury certificates of indebtedness 153, 972, 000 By cash '__« 107, 526, 234 949, 239, 980 Between Saturday noon, November 17, and Monday noon, November 19, deliveries of bonds were made by registered mail and over the counter to a total of $237,342,550, which, added to the amount previously sold for cash, made total deliveries to that date of Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

290 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. $296,393,850, or 1,062,918 pieces. The amount of bonds delivered up to and including December 31, was $746,180,100, and the number of pieces, 2,170,665. The bond-issue division of the Federal Reserve Bank also undertook the exchange of interim certificates of the first Liberty loan into definitive bonds, and definitive bonds of the first issue into definitive bonds of the second issue. The number of employees engaged in this work at its busiest period was 125; the number of pieces received from owners for conversion to December 31, 1,624,336; and the number issued, 1,887,188. This division also undertook to exchange $1,000 bonds of both issues for equivalent amounts of bonds of smaller denominations, and vice versa. Up to December 31 the number of pieces handled was 171,804. LIBERTY LOAN EXPENSE. The expenses incurred by the bank in handling the Liberty loans were made with the understanding that the bank would be reimbursed by the Treasury Department for its expenditures. The following itemized list shows the expenses on account of the first and the second loans, as well as the amounts for which the bank was reimbursed up to December 31, the figures for the first loan including all expenses of departments engaged in handling matters relating to this loan up to December 31: First loan. Advertising. $68. 89 Telephone, telegraph, and ship- Buttons and badges 2, 192. 86 ping $4,357.91 Bond-issue division 127, 120. 12 Stationery 23, 079. 19 Circulars 40, 455. 08 Traveling expenses 6, 729. 27 General expenses 45, 978. 34 Miscellaneous 3, 085. 00 Posters and signs 18, 861. 85 Publicity 10, 281. 84 Total 345, 351. 79 Postage 12, 937. 94 Reimbursed to Dec. 31, 1917__ 297, 310. 39 Rent 41,195.13 Salesmen 9, 008. 37 Net amount due 48, 041. 40 Second loan. Department. Bond issue Total. and certifi- Government Districates of in- deposit. bution. Publicity. debtedness. $51,584.71 $16,176.30 $32,851.15 $26,261.49 $126,873.65 Traveling expenses . .. 255.38 22,003.68 2,664.08 24,923.14 Printing and stationery - — 6,159,24 1,629.98 64,818.89 97,382.24 169,990.35 Equipment 9,842.90 1,391.60 6,595.79 1,071.04 18,901.33 Express 876.33 5,079.41 5,318.27 11,274.01 Telegraph and telephone 439.98 .72 6,968.87 11,205.71 18,615.28 Postage 2,321.83 7,705.03 336.71 10,363.57 Rent 6,973.80 1,935.64 6,891.39 2,768.10 18,568.93 Newspapers and directories 6.00 24.00 224.00 827.48 1,081.48 Miscellaneous 19,913.90 145.86 43,628.71 75,026.50 138,714.97 98,374.07 21,304.10 196,766.92 222,861.62 539,306.71 Petty cash fund . . 3,055.45 Total 542,362.16 Reimbursed to Dec 31 1917 242,379.94 Net amount due ! 299,982.22 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 2—NEW YORK. 291 GOVERNMENT DEPOSITS. The act of Congress approved April 24,1917, under which the first Liberty loan was made, authorized the Secretary of the Treasury to deposit in such national banks, State banks, and trust companies as he might designate, upon the pledge of security, the proceeds arising from the sale of bonds and certificates of indebtedness. The responsibility for the appointment of depositaries, the receipt and approval of security, and the deposit and withdrawal of funds were placed upon the Federal Reserve Bank under the instructions and supervision of the Treasury Department. Duly qualified depositary banks were permitted to pay for certificates of indebtedness as well as Liberty bonds by opening book credits therefor in favor of the Treasury. A very large proportion of the deposits in depositary banks were created in this way, and the transfer of funds and disturbances to the money market were thereby reduced to a minimum. During the first loan period a special department with 32 employees, in charge of a volunteer committee appointed by the Federal Reserve Bank, the chairman of which was made an acting deputy governor, undertook all the work connected with the management of Government deposits. During the second loan period this department, with 54 employees, was operated as a department of the Federal Reserve Bank, with the same committee acting in an advisory capacity. During the first loan period 306 banks qualified as depositaries by pledging collateral of a specified character with the Federal Reserve Bank. In order to facilitate the pledging of collateral, local custodians were appointed in 49. cities of the district. The largest amount of collateral held at any one time against redeposit of certificate of indebtedness funds was $172,000,000; the largest amount of securities held against redeposits of Liberty loan funds was $367,- 280,044 with local custodians and $274,518,118 in the vault of the Federal Reserve Bank. The largest amount of Government funds on deposit at any one time was $171,091,000 of certificate of indebtedness funds on June 11 and $304,353,448.12 of Liberty loan funds on July 5. As the Treasury Department had stated that banks making payment for Liberty bonds by the use of certificates of indebtedness would receive preferential treatment in the apportionment of Government deposits, a readjustment of such deposits in depositary banks was accordingly made on July 19. During the second Liberty loan campaign the redeposited funds were handled in the same manner but, at the request of this bank, a larger number of banks qualified as depositaries, 531 in all. The number of local custodians of securities was increased to 50. The largest amount on deposit with depositary banks was $1,306,118,- 990.43 on November 30. while the largest amount of securities held Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

292 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. was $1,943,625,476.27 on December 1. In order to be prepared for similar work during the next loan the department has been maintained intact and banks have been encouraged to retain their status as depositaries and to leave their securities pledged with the Federal Eeserve Bank for this purpose. The number of qualified depositaries on December 31 was 530, and collateral held aggregated $858,- 534,219.80. WAR-SAVINGS AND THRIFT STAMPS. Shortly before December 1 the Federal Eeserve Bank was requested by the Secretary of the Treasury and the National War- Savings Committee, acting under the Treasury regulations, to maintain a supply of war-savings stamps and certificates and thrift stamps and cards for sale to agents of the first and second class, also to transmit applications for agencies when duly approved to the Treasury Department. The following supply of stamps was received prior to December 31: War-savings stamps (pieces) 4,000,000 Thrift stamps (pieces) 3,500,000 of which on December 31 the following amounts had been sold or consigned to agents: War-sav- Thrift ings stamps. stamps. Total. Pieces. Pieces. Pieces. New York City 242,022 785,421 1,027,443 New York State outside New York City 50,968 144,100 195,068 New Jersey 19,920 43,628 63,548 Connecticut 4,400 8,600 13,000 Total 317,310 981,749 1,299,059 ORGANIZATION OF THE BANK. INTERNAL MANAGEMENT. During the year the directors of the bank held 36 meetings. The executive committee, consisting of the governor or deputy governor, the chairman, and four of the directors (all of the directors serving upon it in turn), held 170 meetings. The committee on State bank membership held 26 meetings and other special committees held 14 meetings. At the first meeting of the directors held in 1917 the officers of the bank were reelected for the ensuing year. With the increased scope of the activities of the bank, many additions to the staff of the bank, both official and clerical, have become necessary. J. Herbert Case, Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 2—NEW YORK. 293 vice president of the Farmers' Loan & Trust Co. of New York, was elected deputy governor September 26 and entered upon his duties October 8. George W. Davison, vice president of the Central Trust Co. of New York, served as acting deputy governor from June 6 to July 31, during which time he conducted in a volunteer capacity the Government deposit department of the bank. Fred I. Kent, vice president of the Bankers' Trust Co. of New York, was elected acting deputy governor September 26 to take charge of the licensing of exports of coin, bullion, and currency under the President's proclamation of September 7, and of other matters pertaining to foreign exchange. He resigned December 31 to act for the Federal Reserve Board in handling these and similar matters. Two additional assistant cashiers were elected during the year, Arthur W. Gilbart on June 6, and Adolph J. Lins on September 5. Two acting assistant cashiers were also elected on September 5 to take charge of the bond issue division of the bank, W. M. St. John, assistant cashier of the National Bank of Commerce of New York, and J. W. Jones, manager of the Long Island branch of the Irving Trust Co. On January 1, 1917, the bank had 9 officers and 164 clerks; at thq close of the year the staff consists of 16 officers and 829 clerks, the increase having been made necessary by the general expansion of the bank's business in all departments, and particularly by work connected with the Government financing. Following is a list of departments and the number of employees in each. Number of BANK DEPAKTMENTS. employees. Number of Secretaries 3 employees. Shipping 5 Auditing and examination 29 Statistics 5 Bookkeeping and statements 15 Stenographic 23 Chief clerk 7 Supply 2 Collection 11 Telephone operators 6 Credit 11 Transit 167 Distribution 5 Vault 2 Discount 21 Watchmen and floormen 25 Federal reserve agent 5 Wire transfers 7 Filing 18 General bookkeeper 1 Total 496 Mail teller 17 Officers' mail 2, Miscellaneous 3 GOVERNMENT DEPARTMENTS. Money 37 Bond exchange 99 Night force 13 Bond issue 129 Note teller 8 Government check 19 Pages 9 Government deposit 52 Paying teller 2 Certificate of indebtedness 34 Porters 17 Receiving teller 3 Total 333 Return item and messenger department 17 Grand total 829 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

294 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. The year 1917 has made heavy demands on the staff of the bank. The necessity of transacting promptly an unprecedented volume of business, in inadequate and crowded quarters, with many new and inexperienced clerks has thrown a strain on every member of the staff which has been none the lighter on account of the great amount of night work involved. In spite of the overwhelming tasks which have often been imposed upon the bank in connection with the Government financing, the work of the bank has been kept up and a spirit of cheerfulness and loyalty has prevailed among its employees throughout the year. In recognition of increased living costs which war conditions have brought about and of the high pressure under which the entire staff has worked during the past nine months, the directors, at the close of the year, with the approval of the Federal Reserve Board, supplemented the normal compensation of all employees below the rank of cashier by an additional payment equal to 15 per cent of annual salaries not exceeding $1,500, and 10 per cent of salaries exceeding $1,500. At the close of the year the staff of the bank consisted of 498 men and 351 women. Plans are being matured for the conduct of educational courses for both men and women, which will stimulate their interest in the work of the bank and afford opportunities for development and advancement. BAXK PREMISES. During the year the offices occupied by the bank, at the time of the last report, on the ground and fifth floors of the Equitable Building, have been outgrown. The bank has, accordingly, engaged such additional space on the fourth and fifth floors of the Equitable Building as could be obtained and has also found it necessary to lease the entire building at 50 Wall Street. The Liberty loan committee and the departments which handle Liberty bonds have been placed on the fourth and fifth floors of the Equitable Building; while the transit, securities, Government deposit, collection, and bookkeeping departments of the bank and part of its auditing staff, have been transferred to 50 Wall Street. The total amount of space occupied at the close of 1917 was about 65,000 square feet. The capacity of the large vault installed a year ago has become so taxed with Libeirty bonds and other matter relating thereto that it has become necessary again to avail of the courtesy of the New York Clearing House Association and to use one of its vaults to store currency. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 2—NEW YORK. 295 ELECTION Or DIRECTORS. To fill the vacancies caused by the expiration on December 31,1917, of the term of Robert H. Treman and William B. Thompson, as directors of class A and class B, respectively, an election was held from November 20 to December 6., Of the 224 banks in the group which voted this year (banks having capital and surplus from $66,000 to $200,000) only 91 chose electors and 84 actually voted. The following candidates for the vacancies were nominated: For class A director: P. A. Canfield, of Kingston, N. Y., nominated by 1 bank; John C. Leggett, of Cuba, N. Y., nominated by 3 banks; Robert H. Treman, of Ithaca, N. Y., nominated by 53 banks; C. P. H. Vary, of Newark, N. Y., nominated by 1 bank. For class B director: Jacob Rice, of Kingston, N. Y., nominated by 1 bank; William B. Thompson, of Yonkers, 1ST. Y., nominated by 54 banks. At the closing of the polls it appeared that the following votes had been cast in the column of first choice : For class A director: P. A. Canfield, 0; John C. Leggett, 2; Robert H. Treman, T9; C. P. H. Vary, 2. For class B director: Jacob Rice, 1; William B. Thompson, 83. Mr. Treman was declared elected class A director and Mr. Thompson class B director, each for a term of three years beginning January 1, 1918. On January 31 Charles Starek, class C director, resigned and the Federal Reserve Board on February 9 filled the vacancy thus occasioned by the appointment of W. L. Saunders to serve for the unexpired term. He has been reappointed for the three-year term beginning January 1, 1918. On December 22 the Federal Reserve Board redesignated Pierre Jay chairman of the board and Federal Reserve agent for 1918. MEMBER OF ADVISORY COUNCIL. On January 3 the directors reelected J. P. Morgan, of New York City, a member of the Federal Advisory Council from Federal Reserve District No. 2 for the year 1917. GENERAL BUSINESS CONDITIONS, BANKING POSITION OF THE DISTRICT DURING 1917. The following table gives comparative figures for important items in the statement of members of the New York Clearing House Asso- Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

296 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. eiation, State banks and trust companies in New York State, and national banks in this district (in thousands of dollars) : Dec. 30, 1916. Dec. 29,1917. I Decrease. Increase. New York clearing house banks: Loans, discounts, and investments $3,339,450 $4,118,775 $779,837 Gold and lawful money 439,065 106,228 $332,837 On deposit with Federal reserve bank. 193,698 561,439 367,741 Net demand deposits 3,334,272 13,885,273 551,001 Net time deposits 159,785 198,492 38,707 National-bank note circulation 28,955 34,104 5,149 State banks and trust companies in New York State: Nov. 29, 1916. Nov. U, 1917. Loans and investments 2,626,604 3,076,129 449,525 Due from banks, bankers, and trust companies 373,610 307,692 65,918 Cash in vault 235,240 124,772 110,468 Due from Federal reserve bank (2) 183,367 183,367 Customers' liability on acceptances 83,041 110,159 27,118 Deposits 3,121,992 3,449,427 327,435 Bills payable and residcounts 521 97,676 97,155 National banks in district No. 2: Dec. 27, 19:6. Nov. 20, 1917. Loans and discounts 2,238,642 2,522,568 283,926 Customers' liability on letters of credit and acceptances 62,495 73,529 11,034 United States bonds and notes and certificates of indebtedness 87,420 967,189 879, 769 Stocks and bonds 600,792 646,296 45,504 Due from Federal reserve bank 229,662 448,346 218,684 Cash in vault 355,830 122,390 233,440 Due from banks and bankers 211,865 190,866 20,999 Due to banks and bankers 1,190,571 1,072,487 118,084 United States deposits (2) 699,495 699,495 Deposits, demand and time 2,316,488 2,587,638 271,150 Bonds and securities borrowed 8,540 94,435 85,895 Bills payable and rediscounts , 18,976 224,812 205,836 1 Includes United States deposits. 2 Not shown separately. Among the important changes shown in the statement of the New York Clearing House banks is the transfer of approximately threefourths of the banks' holdings of gold and lawful money from their vaults to the Federal Reserve Bank, due to changes in reserve requirements, discussed earlier in this report, and also to the entrance of practically all of the large State banks and trust companies of the city into the Federal Eeserve system. Loans, discounts, and investments show an increase of $779,000,000, or 23.5 per cent, due principally to investments in or loans upon United States Government securities, the amount of such investments and loans on December 28, 1917, being $604,000,000. Because of withdrawals of deposits from this center by banks in other districts, the increase in net deposits has been much less, totaling only $590,000,000. The proportion of gold and lawful money in vault and deposited with Federal Eeserve Bank to the aggregate net deposit liability shown above decreased from 18.15 per cent at the end of 1916 to 16.35 per cent at the end of 1917. Loans and investments of State banks and trust companies in New York State increased $449,000,000, while deposits show a much smaller increase, the difference being offset almost entirely by an increase in bills payable and rediscounts of $97,155,000. Eeserve de- Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 2—NEW YORK. 297 posits of $183,000,000 have been placed with the Federal Eeserve Bank, reducing cash in vault by $110,000,000 and balances with banks and bankers by $66,000,000. The most important increases in the figures for national banks in the Second Federal Eeserve District are $880,000,000 in holdings of United States obligations, offset in part by an increase of $699,000,000 in United States deposits. Loans and discounts show an increase of $284,000,000, which is slightly greater than the amount of the increase in demand and time deposits. Reserves carried with the Federal Eeserve Bank show an increase of $219,000,000, reflecting transfer of cash from vaults to the Federal Eeserve Bank. The increase in the amount of bills payable and rediscounts of national banks and State institutions, whose reports are summarized above, from $19,000,000 to $322,000,000, is the most significant indication of the strain which has come upon the banking machinery of the district, the major portion of the rediscounting and borrowing having been with the Federal Eeserve Bank. MONEY RATES. Money rates were relatively low in the early months of 1917 and continued so until some time after the declaration of war on April 6. Commercial paper was sold freely at rates ranging from 3 to 5 per cent; bankers' acceptances were sold on a basis of 2J to 3f per cent; call money rates were at or below 2^ per cent, and rates for time money approximated those for commercial paper. A distinctly firmer tendency became apparent as the Government's preparations for placing the first Liberty loan progressed. Call money often touched 6 per cent, and with the higher call rates and the desire of the banks to keep their funds in available form, time loans on stock exchange collateral became difficult to obtain. Member banks in New York City availed themselves freely of the rediscount and loan facilities of the Federal Eeserve Bank, with the result that, though rates were very firm, stability unknown in former periods of strain was given to the money market. Only once during the period of financing the first loan did call money go above 6 per cent. Following the installment payment on the first loan due June 28 and the maturity of certificates of indebtedness which had been issued in anticipation of the loan, rates for call money and commercial paper became easier and continued so for some weeks. As the time for placing the second Liberty loan approached, rates again advanced, commercial paper advancing from 4^-5 per cent in early August to 5-5| per cent in the early part of September, and 5|-6 per cent in October, where it remained until payment of the first installment on the second Liberty loan was made on Novem- Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

298 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. ber 15, when it declined to 5J—of per cent. Another upward turn came during the last week of the year and carried the rates again to 5|—6 per cent. The call money rate advanced early in September and ruled close to 6 per cent, with one loan of $50,000 on September 25 at 7 per cent. Early in October, however, when the actual campaign for placing the second Liberty loan began, the rate declined to 4 per cent and remained steady at about that figure throughout the month of October and the first half of November, the steadiness in the supply of accommodation having been accomplished largely through the cooperation of all the banks in New York City with the Federal Eeserve Bank and the Liberty loan committee. During the last few months of the year the rates quoted on time loans or collateral were 5|-6 per cent and during the last week of the year call money rates again stiffened and held close to 6 per cent. The tendency throughout the year has been toward firmer rates for loans of all kinds, and the preference given to Government borrowings tended to diminish somewhat the supply of credit available to other borrowers. Commercial paper and banker's acceptances, because of their availability for rediscount with the Federal Eeserve Bank, have been less affected than loans on stock exchange collateral and have found a reasonably favorable market. GOLD MOVEMENT. The United States Treasury statement of money in circulation, dated January 1, 1918, shows gold in the country $3,040,439,343, as compared with $2,864,841,650 on Januarj? 1, 1917, an increase of $175,597,693. The gold production of the United States and its dependencies in 1917 was $84,456,600. Imports of gold from all sources during the year were $553,713,000. Gold exports were $372,171,000, mainly to South American countries, Cuba, Spain, Japan, and India. On August 13 the Federal Eeserve Board requested the Federal Reserve Bank of New York to obtain information relative to the amount and destination of gold exports from this district to foreign countries. On September 7 the President declared an embargo on gold, silver, and currency shipments out of the country, placing in the hands of the Secretary of the Treasury and the Federal Eeserve Board the enforcement of this embargo and granting discretion to issue permits for exports where not contrary to the public interest. Since that date, the Federal Eeserve Bank has received and passed upon applications originating in this district for permission to export gold, silver, or currency and transmitted such applications with its recommendation to the Federal Reserve Board for final action. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 2—NEW YORK. 299 FOREIGN LOANS. In the last annual report extensive foreign borrowings during the war were listed. During 1917 such borrowings almost entirely ceased, the principal loans placed being $250,000,000 British Government one and two year secured notes in January, $8,098,250 ten-year bonds of the Province of Buenos Aires in February, $100,000,000 French Government two-year secured notes in March, $4,000,000 fiveyear bonds of Genoa, Italy, $2,400,000 twelve-year notes of Bolivia, $100,000,000 one-year notes of the Dominion of Canada sold in August, and British treasury bills placed in several issues of $15,- 000,000 each by Messrs. J. P. Morgan & Co., the amount of this issue outstanding at any one time not having exceeded $100,000,000. During 1917 the Secretary of the Treasury under authority of Con- 5 gress, has advanced to the Governments of Great Britain, France, Italy, Russia, Belgium, Servia, and Eoumania a total of $3,656,- 129,750, receiving in exchange interest-bearing obligations of those nations. FOREIGN BANKING CONDITIONS. The following statements show the condition of three leading European banks toward the end of 1916 and 1917: BANK OF ENGLAND. Dec. 27,1916. Dec. 27,1917. Circulation £39,675,000 £45,943,000 Public deposits 52,116,000 42,009,000 Other deposits 126,726,000 J24,161,000 Government securities 57,187,000 58,303,000 Other securities 106,461,000 94,888,000 Reserve 33,079,000 30,843,000 Bullion 54,304,915 58,337,469 Proportion of resources to liability per cent 18.49 18.56 BANK OF FRANCE. Dec. 28,1916. Dec. 27,1917. Francs. Francs. Gold 5,075,914,550 5,351,524,800 Silver 294,869,000 247,656,889 Discounts and advances. 1,937,278,000 2,136,760,143 Circulation 16,678,817,000 22,336,799,275 Deposits 2,260,224,000 2,913,741; 500 Treasury deposits 15,009,000 253,858,163 IMPERIAL BANK OF GERMANY. Dec. 30,1916. Dec. 31,1917. Marks. Marks. Gold 2,520,473,000 2,405,580,000 Loans and discounts 9,609,767,000 14,596,100,000 Circulation 8,054,652,000 11,467,740,000 Digitized for FRA3S4E3R65 °—IS http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

300 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. NEW YORK STOCK EXCHANGE. During the early months of the year, trading on the New York Stock Exchange both in stocks and bonds was quite active, but following our entrance into the war the tendency has been toward much lighter trading at decreasing prices. Bond prices had for some time shown downward tendencies and this movement quickly extended to stocks when it became apparent that companies which had profited greatly from war activities prior to our becoming a belligerent would not continue to be permitted to make and retain abnormal profits. As a result of this factor and the competition of Government securities, prices have shown an almost continuous downward trend and have reached levels lower than any recorded since the autumn of 1914.» The New York Times record of the average prices of 50 representative stocks at the high point in 1917 was 90.40 on January 4, 1917, as against 101.51 on November 20, 1916, and 65.88 at the end of 1917, while the low of 57.43 for the year was touched on December 20. The price of 40 representative bonds at the beginning of 1917 was 88.63; the high for the year 88.48, January 26; low, 74.21, December 20; close, 76.80. A decided upward turn in the last week of the year, reflected in the figures given, followed the announcement of Government control of railroads. The following record of comparative figures shows the volume of stocks and bonds dealt in on the New York Stock Exchange for the past seven years. Shares. Bonds. 1917. $184,536,371 $1,052,346,950 1916. 230,060,900 1,133,935,300 1915 173,155,644 955,525,200 1914. 45,989,158 460,472,500 1913. . 76,134,996 497,158,600 1912 118,452,676 645,300,000 1911. 127,376,149 878,933,700 CROPS. As crop planting time approached in the spring of 1917, realization that the world's food supply was in danger of falling materially below demand led to vigorous efforts throughout the country to increase the yield of staple products. This movement was greatly stimulated by the extremely high prices which such products commanded. As a result, a very much increased acreage was planted with resulting heavy yields of several of the more important commodities, though wheat production, upon which attention naturally centered, did not increase very greatly over the short crop of 1916. The corn crop of 3,159,494,000 bushels, valued at $4,053,672,000, the Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 2—NEW YORK. 301 oats crop of 1,587,286,000 bushels, valued at $1,061,427,000, and the potato crop of 442,536,000 bushels, valued at $543,865,000, are the largest on record. Other crops whose production established records were rye, sweet potatoes, beans, onions, cabbages, and tobacco. The cotton production is estimated at 10,949,000 bales. EXPORTS AND IMPORTS. During the early months of the year exports and imports at the port of New York ruled very materially above those of the preceding year, but in later months have only approximately held their own as compared with a year ago, the difficulties of obtaining shipping space having contributed to the later restriction of foreign trade. Shipments to and from Europe, other than those made by the Government, have shown reductions, while there has been a substantial gain in trade with South American countries. Exports from this customs district for the calendar year 1917, not including Government shipments, aggregate $2,937,000,000, a gain of $147,000,000 over last year, and imports aggregate $1,360,000,000, a gain of $103,- 000,000. GENERAL'BUSINESS CONDITIONS. The early months of 1917 were marked by great business activity, hampered in some degree by difficulties of transportation and embargoes on freight shipments which the railroads found it necessary to impose. During the late spring, following our declaration of war against Germany, there was a temporary recession of activity in retail lines, occasioned, apparently, by a tendency of large sections of the population to economize. This movement, which created widespread apprehension among dealers in articles in the nature of luxuries, was short lived, and, with the coming of fall, business in most lines revived and became very active, the most marked exception being the building trade, which continued very quiet throughout the remainder of the year. There have been very far-reaching adjustments in business and industry; such lines as machinery, munitions, steel products, cotton and woolen textiles and clothing and similar activities being stimulated by war conditions. On the other hand, the automobile industry, manufacturers of household furniture, manufacturers of various building materials, and many other lines have experienced curtailment of business to a marked degree, but this curtailment has, apparently, not been sufficiently great to offset the expansion in essential war industries; consequently excessively keen competition for rail- Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

802 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. road transportation facilities, for fuel supplies, and for the products of steel mills has taken place, with the result that the railroads, though doing all in their power to cooperate in handling the unprecedented volume of traffic pressed upon them, have been unsuccessful. Coal production and distribution, though 50,000,000 tons above the normal output, is still estimated by the United States Fuel Administration to be 50,000,000 tons short of the amount required for consumption. Constantly increased difficulty in obtaining and retaining labor supply has been experienced by practically all industries, and heavy advances in the wage scales and salaries have been made in recognition of the higher costs of living. Prices of materials have increased steadily, and in many cases rapidly, so that the whole level of production cost and the selling price of finished products is materially higher than at the beginning of the year. Bradstreet's index number for commodity prices for December 1, 1917, is $17.8113 as compared with $13.6628 December 1, 1916, an increase of over 30 per cent. The tendency on the part of business and manufacturing interests is to proceed with great caution in the purchase of materials and the manufacture of goods, buying orders being restricted, so far as possible, to immediate needs. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

APPENDIX. Capital account reconciliation, Jan. 1, 1911, to Dec. 31, 1917. Capital paid in Jan. 1, 1917 $11, 865, 750 Sundry increases: Due to increase in capital and surplus of member banks $473,150 Due to organization of new national banks 55, 500 Due to admission of State banks and trust companies ' 6, 391, 300 6, 919, 950 18, 785, 700 Sundry decreases: Due to decrease in capital and surplus of member banks 2, 250 Due to banks liquidated . 98,600 100,850 Paid-in capital Dec. 31, 1917 18, 684, 850 Summary of Federal Reserve notes. Total issued to bank: 1914, 1915, 1916 160, 480, 000 1917 415, 000, 000 575, 480, 000 Less notes unfit for circulation retired 1914, 1915, 1916 — $53, 476, 235 Less notes unfit for circulation retired 1917 65, 665, 200 119,141,435 Amount outstanding Dec. 31, 1917 456, 338, 565 As follows: In actual circulation : 397,353,805 Held by Federal Reserve Bank Dec. 31, 1917 58,984,760 On Dec. 31, 1917, the Federal Reserve agent held against Federal Reserve notes: Gold certificates 250, 598, 565. 00 Commercial paper 206, 538, 872. 84 303 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

304 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. Total of Federal Reserve notes paid out by the Federal Reserve Bank of New York, by months. 1017. To member To nonmembanks. ber banks. January.. $9,164,000 $670 000 February . 40,294,000 3,914.500 March 38, 757,000 2.644,000 April 32,994, 500 3,657.000 Mav 25,578,000 2,086,000 June... 27,006,000 2,424.000 July 25, 598, 000 1,361.000 August 30,686,000 3,122, 000 September... 33,950,250 7,450.500 October 40,436,000 12,857 800 November 54 231 000 6 487 000 December 70,240,000 4,346,000 428,934,750 50,999,800 Total paid to nonmember banks . . . 50,999,800 479,934,550 Total received from Federal Reserve agent 415,000,000 Movement of Federal Reserve notes between Federal Reserve Bank of New York and other Federal Reserve Banks, Jan. to Dee. 31, 1917. Notes of Federal From Federal Reserve Bank of— R o e f s N er e v w e Y Ba o n rk k To Federal Reserve Bank of— T s h h e i ir p p n e o d t . es received. Atlanta $1,236,500.00 Atlanta $3,030, 710 Boston 9,482,800.00 Boston 3,018.450 Chicago 3,425,000.00 Chicago.. . . .. 1,698, 920 Cleveland 1,250,300.00 Cleveland 1,725,105 Dallas 599,420.00 Dallas 964,265 Kansas City 127, 750. 00 Kansas City 929,160 Minneapolis 390,500.00 Minneapolis 792 3^5 Philadelphia 11,169, 902. 50 Philadelphia 5,818. 700 Richmond 999,100. 00 Richmond 3,600,750 St Louis 922,200.00 St. Louis 661,150 San Francisco 393, 580. 00 San Francisco 2,560,440 Total 29,997,052.50 Total 24, 799,975 Summary of gold settlement fund operations, Jan. 1, 1917, to Dec. 31, 1917. Amounts received and paid by the New York Federal Reserve Bank in settlement of accounts From or t B o a F n e k d o e f r — al Reserve due. Net gain. Net loss. Received. Paid. Boston $1,269,785,000 $1,289, 707. 000 $19,922,000 Philadelphia. 1,986,687, 000 1, 665,135, 000 $321, 552. 000 Cleveland 1,114,627, 000 935,299, 000 179,328^ 000 Richmond... 790,701, 000 875,366, 000 84, 665,000 Atlanta 256,241, 000 352,552,000 96,311,000 Chicago 1,196,324,000 1,505,874,000 309,550,000 St. Louis 338;856, 000 335,296,000 3,560,000 Minneapolis.. 235,475, 000 338, 041, 000 102,566,000 Kansas City.. 240,207,000 203, 552,000 36," 655,666 Dallas 22,794, 000 280, 949,000 53,155,000 San Francisco, 770,196, 000 910,253, 000 140, 057, 000 Total..., 8,426,893, 000 8,692,024,000 541,095,000 806,226,000 Loss...., 265,131,000 265,131,000 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 2—NEW YORK. 305 SCHEDULE SHOWING WHEN THE PROCEEDS OF ITEMS WILL BECOME AVAILABLE. Immediate credit: New York (Manhattan, if received by 9 a. m.). One day after receipt: Boston, Philadelphia, Richmond, Baltimore, and Iioanoke. Two days after receipt (business days) : Members of clearing houses in Cleveland, Cincinnati, Chicago, Atlanta, Minneapolis, St. Paul, St. Louis, Kansas City, Mo., Kansas City, Kans. Banks in Connecticut, Delaware, District of Columbia, Maine, Maryland, Massachusetts,1 New Hampshire, New Jersey, New York,1 Pennsylvania,1 Rhode Island, Vermont, and Virginia.1 Four days after receipt (business days) : Members of clearing houses in Dallas, NewT Orleans. Banks in Alabama, Arkansas, Florida, Georgia,1 Illinois,1 Indiana, Iowa, Kansas,1 Kentucky, Michigan, Minnesota,1 Mississippi, Missouri,1 North Carolina, Ohio,1 South Carolina, Tennessee, West Virginia*, and Wisconsin. Eight days after receipt: Banks in Arizona, California, Colorado, Idaho, Louisiana,1 Montana, Nebraska Nevada, New Mexico, North Dakota, Oklahoma, Oregon, South Dakota, Texas1 Utah, Washington, and Wyoming. NOTE.—Two-day items we forward on Saturday will be available Tuesday; four-day items we forward Thursday will be available Tuesday, and those forwarded Friday and Saturday on Wednesday. Operations in United States Government obligations during 1911. Purchased from United Issue. Un S d ta er tes Treasu O re t r h . er Pu m r o c a p h r e k a n s e e t. d v d e e S i r e n o t m e g ld d e , , 1 d 9 o c 1 o r d 7 n r u . e - r - - B h 3 a a 1 l n a , d n 1 c 9 T e 1 e 7 o c . n . section 18. purchases. Conversion 3s, 1917-1947 $1,776,500.00 $521,000.00 $1,255,500.00 2 per cent consols, 1930 2,105,000.00 $222,550.00 2,327,500.00 50.00 Panama Canal, 1916-1936 100,000.00 100,000.00 Panama Canal, 1918-1938 225,000.00 "906,'666." 66 1,125,000.00 1-year notes due Jan. 1,1918 521,000.00 520,000.00 1,000.00 1-year notes due Apr. 1,1918. 1,255,000.00 $1,532,000.00 2,787,000.00 1-year notes due July 1,1918.. J 750,000.00 750,000.00 1-year notes due Oct. 1,1918... 955,000.00 955,000.00 3 per cent, 1908-1918 50,000.00 50,000.00 3J per cent 15-30 year Liberty loan bonds of 1917 1,500,000.00 26,200.00 1,118,900.00 2 407,300.00 3| per cent 15-30 year Liberty loan bonds of 1917 (bonds and interest purchased) 57,386.68 53,535.54 3,851.14 4 per cent 10-25 year second Liberty loan bonds of 1917... 25,000.00 3,429,698.50 2,600.00 3,859,198.50 2 per cent certificates of indebtedness due June 29,1917 20,000,000.00 3 per cent certificates of indebt- 20,000,000.00 edness, dated Apr. 25, 1917, due June 30,1917 18,950,000.00 3 per cent certificates of indebt- 18,950,000.00 edness, dated May 10,1917, due July 17,1917 7,332,000.00 1,500,000.00 Z\ percent certificates of indebt- 8,832,000.00 edness, dated May 25,1917, due July 30,1917 814,000.00 2,590,000.00 3£per cent certificates of indebt- 3,404,000.00 edness, dated June 8,1917, due July 30,1917 4,977,000.00 1,846,000.00 3i percent certificates of indebt- 6,823,000.00 edness, dated Aug. 9,1917, due Nov. 15,1917 5,005,000.00 3£ percent certificates of indebt- 5,005,000.00 edness, dated Sept. 17, 1917, due Dec. 15, 1917, called for payment Dec. 9, 1917 2,562,000.00 40,115,000.00 42,677,000.00 1 Except banks in cities referred to.. 2 Held for delivery to holders of participation certificates and not included in earning assets. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

306 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. Operations in United States Government obligations during 1917—Continued. Purchased from United Issue. Un S d t e a r tes Treasu O re th r. er P m ur o a c p r h e k a n e s t e . d v d e e S i r e o n t m e l g d d e , 1 , d 9 c o 1 o r d 7 n u . r - e r- - B h 3 a a 1 l n a , d 1 n 9 c D 1 e e 7 o c . n . section 18. purchases. 3| percent certificates of indebtedness, dated Aug. 28,1917, due Nov. 30,1917 $65,045,000.00 $65,045,000.00 4 per cent certificates of indebtedness, dated Sept. 26, 1917, due Dec. 15, 1917, called for pavment Dec. 11, 1917 6,026,000.00 6,026,000.00 4 per cent certificates of indebtedness, dated Oct. 11,1917, due Oct. 18,1917.. $100,000,000.00 100,000,000.00 4 per cent temporary loan dated Oct. 16, 1917, due Oct.18,1917 10, OW, 000.00 10,000,000.00 4 per cent temporary loan dated Oct. 17, 1917, due Oct. 18, 1917 20,000,000.00 20,000,000.00 2 per cent temporary loan dated Oct. 29, 1917, due Oct. 31,1917 20,000,000.00 20,000,000.00 2 per cent temporary loan dated Nov. 15, 1917,, due Nov. 19,1917 1 150,000,000.00 150,000,000.00 2 per cent temporary loan dated Nov. 19, 1917, due Nov. 20,1917 150,000,000.00 150,000,000.00 4 per cent certificates of indebtedness, dated Oct. 24, 1917, due Dec. 15, 1917 59,992,000.00 59,992,000.00 4 per cent certificates of indebtedness, dated Nov. 30, 1917, due June 25,1918.. 621,000.00 42,540,000.00 28,161,000.00 $15,000,000.00 United States bonds surrendered for conversion during 1917: United States 2 per cent consols, 193CL _• $2,327,500 United States Panama Canal, 1916-1936 100, 000 United States Panama Canal, 1918-1938 1,125, 000 3, 552, 500 Beceived by conversion during 1917: Jan. 1: United States 1-year 3 per cent notes due Jan., 1918 521, 000 United States 3 per cent convertible bonds of 1917-1947 521, 000 Apr. 1: United States 3 per cent convertible bonds of 1917-1947. 1, 255, 500 United States 1-year 3 per cent notes due Apr. 1 1,255, 000 3, 552, 500 Amount 1-year notes sold 520, 000 Amount of conversion bonds sold 521, 000 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 3—PHILADELPHIA. R. L. AUSTIN, Chairman <md Federal Reserve Agent. I. INTRODUCTION. The period covered by this report has been probably the most momentous in the life of the Nation since the days of the Civil War. The resources of the banks have been called upon to meet the abnormal demands growing out of the vast increase in business incident to the war, and on account of the floating of the Liberty loans. The Federal Eeserve Banks have enabled them to meet these demands. II. RESULTS OF OPERATION. Comparative statement of condition of the Federal Reserve Bank of Philadelphia. Dec. 31, 1917. Dec. 30, 1916. Dec. 31,1915. KESOURCES. Collateral notes—members $4,008,400.00 $900,000.00 Bills discounted—members 31,903,836.94 663,076.79 $168,274.06 Bills bought in open market— 18,390,067.91 13,656,430.08 2,542,975.94 U M n u i n te ic d i p S a t l a w te a s r b ra o n n t d s s and notes. 9; 6 1 4 0 9 , , 0 9 0 5 0 0 . . 0 0 0 0 2,8 4 2 6 5 5 , , 0 1 0 1 0 2 . . 0 2 0 2 1 1 , , 9 4 9 8 3 4 , , 7 1 5 4 0 7 . . 0 1 0 3 Earning assets.. 63,962, 254.85 18,509,619.09 6,189,147.13 Interest accrued on United States bonds and notes 906.44 17,057.93 10,142.15 Cost of unissued Federal Reserve notes 511.99 27,708.01 43,172.04 Expenses paid in advance 055.51 2,445.83 1,684.23 Transit department expenses 1,367.18 Furniture and equipment—general 18,491.31 Furniture and equipment—transit department 25,580.56 15,409.87 Organization expense 31,517.06 Due from Federal Reserve banks—net 12,370,908.10 5,382,501.30 3,025,971.02 Due from banks and bankers 1,517,804.61 609,389.97 Exchanges for clearing house, cash items, etc 7,378,564.69 3,864,733.22 1,046,543.43 Due from member banks—overdrafts 12,804.81 33,959.73 Federal Reserve notes on hand 4,348,590.00 171,140.00 380,267.50 National and Federal Reserve notes of other banks 1,353,500.00 463,476.00 215,885.00 Nickels and cents 209.09 121.89 100.83 Mutilated currency forwarded for redemption 56,027.50 132,500.00 Miscellaneous assets 110,032.85 Gold settlement fund 32,101,000.00 8,042,000.00 9,695,000.00 Gold redemption fund* 65,445,755.00 100,000.00 Gold coin and certificates 19,064,667.50 16,988,892.50 *7,' 445," 485." 66 Bank of England sterling gold account 3,675,000.00 Other lawful money 1,189,996.10 466,154.30 3,358,145.30 Reserve 121,476, 418.60 25,597,046.80 20,498,630.30 Total resources. 212,674,169.60 54,794,517.09 31,495,511.73 LIABILITIES. Capital 6,142,150.00 5,228,100.00 5,269,600.00 Profit and loss 220,238.27 89,966.68 Unearned discount and unearned interest. 160,902.51 39,559.33 14,099. 28 Government deposits 5,387,488.53 3,145,549.05 787,178.45 Due to member banks 103,000,930.13 44,965,072.26 25,424,376.56 Cashier's checks outstanding 435,026.66 26,015.72 107.63 Federal Reserve notesl 97,325,755.00 1,300,000.00 Miscellaneous liabilities 1,678.50 254.05 239*8*1 Total liabilities. 212,674,169.60 54,794,517.09 31, 495,511. 73 1 In June, 1917, the statement was changed so as to include gold with Federal Reserve Agent under "Gold redemption fund/7 and "Federal Reserve notes" now represent gross liability for Federal Reserve notes, instead of only the net liability. Digitized for FRASER 307 http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

308 ANNUAL BEPORT OF THE FEDERAL RESERVE BOARD. The large increase in the bank's figures is due to the increase in reserve deposits of member banks, resulting from the amendment to the act affecting the reserves, to the admittance to membership of a number of large trust companies, the increase in the amount of Federal Reserve notes outstanding, and the operation of the transit department. Federal Reserve notes in circulation at the close of the year amounted to $92,977,165, and exceeded the net amount of member bank deposits by $226,104. Every effort has been made to accumulate gold through the issue of Federal Reserve notes, and on December 31, the amount of gold deposited against notes was $65,445,755. The accumulation of this fund has largely increased the bank's loaning power, and from time to time transfers have been made from it to maintain the bank's reserve. Due to the admission of new members and the increase in the capital and surplus of member banks, the paid-in capital of the bank increased $914,050 during the year, and at the end of the year amounted to $6,142,150. The following table shows the results of the operation of the bank for the year 1917: Earnings for 1917 $1, 015,959 Expense of operation of bank proper $165, 843 Cost of Federal Reserve currency issued (including expressage, insurance, etc.) 70,340 Miscellaneous charges account note issues Depreciation on furniture and equipment 3, 782 Transit department disbursements in excess of net service charges received 22,120 Total 262, 085 Net earnings for year 753, 874 Profit and loss, Jan. 1, 1917 89, 966 Total 843, 840 Dividends paid: Date paid, June 30, 1917; period covered, July 1, 1915, to Dec. 31, 1915; amount 155,320 Date paid, Dec. 31, 1917; period covered, Jan. 1, 1916, to June 30, 1917; amount 466,830 Interest paid on stock surrendered 1, 452 Total 623, 602 Profit and loss, Jan. 1, 1918 220, 238 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

RESOURCES AND; LIABILITIES ~ 1916 AMD 1917 FEDERAL RESERVE BANK OP PHILADELPHIA "PP a p T W I FOB.' OF 3TATCKCNT CHANCED TO SHOW FeoeRAU RESERVE J1OTES IM CIRCULATION A3 A LIABILITY OP THE BANK. AHO GOtO WITH PCDERAL RESERVE AGEOT A5 AN ASSET CO CHART NO. 1. o Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

310 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. ASSETS FEDERAL RESERVE BANK OF PHILADELPHIA 1915 1916 WARRANTS «/oo CASH RESERVE 1917 S 212.674,169.60 CHART NO. 2. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTKICT NO. 3—PHILADELPHIA. 311 LIABILITIES FEDERAL ReseRve BANK OP PHILADELPHIA 1915 1916 OTHER 7L IAB I I V LITIES >\E/ABER DANK5' DEPO51T5 MEMBER &ANK5 © 31,490,000 S 54.790 000 FEDERAL RESERVE MOTES 45 # NET GOY'T. DEP. MEMBER BANKS DEPOSITS 48 % 1917 , 674.169.60 CHART NO. 3. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

312 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. EARNINGS AND EXPENSES. During the early part of the year, the greater portion of the earnings was obtained from the purchase of bankers' bills, but with the placing of the Government loans, the member banks began borrowing freely and the amount of their borrowings increased rapidly as the war financing progressed. For the purpose of reserving its funds for discount purposes, the bank early in the year discontinued, as far as possible, its purchases of municipal warrants. Two dividends were declared during the year, one on June 30, 1917, amounting to $155,320.31, covering the period from July 1, 1915, to December 31, 1915, and the other on December 12, amounting to $466,829.62, covering a period of 18 months from January 1, 1916, to June 30, 1917. The invested funds of the bank increased largely during the year, and earnings increased proportionately. Current expenses remained quite steady, the increase, considering the additional work done by the bank, being small. As the number of Federal Eeserve notes issued greatly increased, their cost became a correspondingly greater item of expense. Net earnings reached their maximum in December, when they were at the rate of 30.2 per cent on the paid-in capital. In the following charts are shown the earnings and expenses by months and the rate of net earnings on the paid-in capital. Earnings and expenses. Earnings. Expenses. Transit Profits departi m n F v r e o e n m s t t s - . U s s S f e a t r n t i c o l a e i e u m t t s e e r . o i s d - f p S r d o u r f n y it - s. T e in a o g r t n s a - . l r p o a e f E t n i o x o s p - e n e s . - i N ss o u t e e s. c D h t c a e io i r p a g n r - e e s - . e s c i x m e n e p n r s v e e e e s n i n x t c o t s - e e f p T e e o n x t s - a e l . a d a b d e N v l i n a e v e d i i t f l - s o - . r e o i n r A n a f a u g r n t n a n e s - e l - . t charges. January $36, 836$11,388 $170 $48,394 $11,354 i$l,804 $13,158 $?5,236 8.4 February 42,145 2,380 565 45,091 11,228 $4,320 131 15,679 29,411 7.3 March 43.664 1,130 44,794 11,580 3,760 309 15,649 29,145 6.5 April 46,938 874 47,812 11,303 4,400 2 260 15, 443 32,369 7.5 May 69,525 2,521 72,046 12,251 2,880 $13 144 15,288 56,758 12.7 JJuunlye 8 7 5 6 , ,9 9 3 9 4 7 1 1, , 0 7 2 7 6 0 7 8 8 7 , , 7 0 0 2 4 3 1 1 2 2 , , 3 7 7 5 3 3 6,8 7 4 6 0 0 1 1 3 7 9 8 7 1 6 7 2 1 0 4 , , 0 50 4 6 3 7 5 2 8 , , 5 6 1 6 7 1 1 1 6 3. . 5 3 August 89,911 403 90,314 15,036 3,040 23 1,755 19,854 70,461 15.7 September 94, 804 1,048 95,853 14,991 8,600 27 4,133 27,751 68,102 15.7 October 84,170 1,248 85,419 16,019 12,160 61 2,386 30,626 54,792 12.2 November 121,412 1,521 122,933 14,323 11,060 74 4,153 29,610 93,323 20.0 December 194, 717 2,856 197,573 20,300 12,520 12 5,769 38,601 158,972 30.2 Total, 1917.987,057 13,768 15,132 1,015,959163,510 70,340 240 i22,120 256,210 759,749 12.2 Total, 1916.376,898 11,170 20,137 * 417,939164,983 17,603 15,653 38,241 167,998 249,941 4.78 1 Includes $1,367.18, balance carried over from 1916. 2 Net service charges in excess of disbursements. 3 Includes $9,734 realized by conversion of United States bonds. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

313 DISTRICT NO. 3—PHILADELPHIA. COMPARISON OF EARNINGS AND EXPENSES 1916 AND 1917 FEDERAL RESERVE BANK OF PHILADELPHIA THOUSANDS (AN FEB MAR APR MY JUNE JULY AUG SEPT OCT NOV DEC TH0U5AND5 OF DOLLARS 0FD0LLAR5 200 eoo 190 190 180 180 170 170 160 160 150 150 140 140 130 130 120 120 no 110 100 100 90 8b 70 60 50 40 30 20 10, ^ BLACK DOTTED LINE = 19ti TOTAL EARNINGS WHITE LIKE = 1916 EXPENSES CHART NO. 4. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

314 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. Ea ta iiiftx <t )t d cepcnscs. 1917 1916 Bills discounted—members $370,359 $28,391 Bills bought in open market 474,653 198,243 Investments: United States bonds and notes 123,875 81,081 Warrants 18,170 69,183 Profits realized on United States securities. 13,768 36,634 Sundry profits 15,132 5,407 Total earnings. 1,015,959 417,939 CURRENT EXPENSES. Expenses of operation: Assessraent account expenses, Federal Reserve Board 22,057 18, 362 Federal Advisory Council (fees and traveling expenses) 350 306 Governors' conferences (including traveling expenses) 174 749 Federal Reserve Agents' conferences (including traveling expenses). 280 Salaries: Bank officers 46,206 39,100 Clerical staff 42,615 52,398 Special officers and. watchmen 8,311 6,012 Directors' fees 3,590 3,220 Directors' per diem allowance 1,080 820 Directors' traveling expenses 1,361 895 Officers' and clerks' traveling expenses 163 558 Legal fees 1,700 2,000 Rent 9,070 9.250 Telephone 2,803 1,231 Telegraph 326 12 Postage and expressage 1,284 11,552 Insurance and premiums on fidelity bonds 4,700 3,415 Light, he at, and power 1,426 1, 147 Printmgand stationery 7,311 6,648 Repairs and alterations 233 987 Allother expenses, not specified 8,702 6,041 Total expenses of operation 163,510 164,983 Cost of Federal reserve notes issued, including expressage 70,340 16,600 Miscellaneous charges account Federal reserve note issues 1,003 Depreciation of furniture and equipment 240 15,653 Disbursements of transit department in excess of net service charges received. 22,120 4,000 Total current expenses, exclusive of amortization charges, account organization expenses 256,210 202, 239 Less disbursements of transit department 34,241 Current expenses of bank proper, exclusive of amortization charges, account organization expenses 256,210 167,998 Net earnings for year 759,749 249,941 Per cent of average paid-in capital. 12.5 4.7 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTBICT NO. 3—PHILADELPHIA. 315 ANNUAL RATE OF NET EARNINGS AVAILABLE FOR DIVIDENDS-^ AND 1917 FEDERAL RESERVE BANK OF PHILADELPHIA PER PER CENT J|P|A\|A|tt|J JIAI5IOINID J|P|M|A|M|J|J|A|S|O|N|D CENT 40 40 • 38 38 36 36 34 34 32 32 30 30 28 28 26 26 / 24 / 24 2E ; 22 20 20 / 18 18 / 16 16 / 14 IT 12 1 p 1C 10 lU / A 8 8 /' ,^ r 4 4 Z c A • MM HEAVY LINE= 6% CUMULATIVE DIVIDEND REQUIRED 5Y FEDERAL KB5ERYE: ACT CHART NO. 5. 34365°—18 21 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

316 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. III. RESERVE POSITION OF THE BANK. The reserve position of the bank on the last Friday of each month is shown below. The bank wishes to express its appreciation of the cooperation of the member banks and State institutions for their services in strengthening its gold reserve. Upon the request of the bank, they deposited their gold and accepted in exchange Federal Reserve notes, and thereby increased the loaning power of the bank. RESERVE REQUIRED AND HELD AGAINST COMBINED DEPOSIT AND NOTE LIABILITIES FEDERAL RESERVE BAMK OP PHILADELPHIA JAN FE6 MAR APR MAY JUNE JULY AUG 5EPT OCT NOY DEC 1 EXCESS RESERVE REQUIRED RESERVES*.- 35 % AGAIN5T DEPOSITS 40% AGAINST MOTES CHART NO. 6. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 3 PHILADELPHIA. 317 Reserve position on last Friday of each month during 1917. [000's omitted.] Liabilities (net). Reserves. Reserve percentage. Againsinet dedeposit lia- Gold Against Total Lawful bilities. against comgold money, Federal bined p D os e i - t. Note. lia T b o i t l a it l y. g a o n l d d si a l n v d er, re T se o r t v a e l s R n e o se te r s ve n a o nd te certifi- silver Gold in actual deposit cates. c c e a r t t e if s i . - Gold. la a w n f d ul ci t r i c o u n l . a- li t a i b e i s l . imoney. Per ct. Perct. Perct. Per ct. January §49,588$15,537 $65,125 $55,654 $922 $56,576 78.1 80.0 108.6 86.9 February 47,648 20,161 67,809 52,100 233 52,333 73.5 74.0 84.5 77.1 Maich 50,697 24,181 74,878 61,110 198 61,308 76.0 76.5 92.6 81.8 April 50,034 29,088 79,102 54,983 556 55,539 57.3 58.5 90.5 70.3 May 56,568 32,686 89,254 57,804 445 58,249 48.2 49.0 93.2 65.3 June 94,361 39,703 134,064 98,993 1,285 100,278 69.2 70.8 84.6 74.5 July 82,256 41,257 123,783 98,577 1,480 100,057 80.0 81.5 79.5 80.9 August 72,214 43,502 115,716 78,945 1,061 80,006 64.8 65.0 73.7 69.1 September 79,143 51,026 130,169 100,365 1,103 101,468 75.7 76.5 79.0 77.5 October 81,946 59,612 141,558 108,510 759 109,269 73.5 74.5 80.9 77.3 November 60,103 78,414 144,517 98,106 940 99,046 67.4 68.8 68.9 68.5 December 94,363 93,642 188,005 119,544 1,148 120,693 64.8 66.0 62.3 64.1 Total gold reserve includes gold in the hands of the Federal Reserve Agent on the last Friday of each month. IV. DISCOUNT RATES. The discount rates remained unchanged from September 21, 1916, to May 10, 1917, when the 15-day rate for commercial paper and member bank collateral notes was reduced to 3 per cent. In order that member banks might extend the necessary accommodation to their customers in making payment for Liberty loan bonds, a special rate of 3J per cent was established for the discount of paper and member bank collateral notes having a maturity of not over 90 days and secured by Liberty loan bonds or United States Treasury certificates of indebtedness. The second Liberty loan having been issued at 4 per cent, a general readjustment of the discount rates seemed advisable, and on November 26 the bank's rates for discount were advanced. The changes are given herewith: Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

318 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. Changes hi discount rates during calendar year 1911. Rate in effect- Jan. 1, May 10, June 1, June 11 Nov. 2, Nov. 26,Nov. 30,Dec. 7, Jan. 1 1917. 1917. 1917. 1917. 1917. 1917. 1917. 1917. 1918. Discounts maturing within 15 days, including member banks' collateral notes. 3 4 4 Paper including member banks' collateral notes secured by United States certificates of indebtedness or Liberty loan bonds maturing within 15 davs 3 3i- 31. Paper maturing within 16 to 60 davs 4 41 4\ Paper maturing within 61 to 90 days 4 ! 4 3 j Paper "secured by United States certificates of in- ! ! debtedness or Liberty loan bonds maturing froni 16 to 90 days.. . 3-\ 1 4 4 Agricultural and lire-stock ! paper maturing after 90 ; 1 days 4& r, i 0 Trade acceptances maturing from 1 to 60 davs 31 : 1 4 Trade acceptances maturing ing from 60 to 90 days 3i 4 4 Commodity paper maturing within 90 days 2, 2 1 ' " i (2) Bankers' acceptances purchased at the market rate, subject to agreement. 1 Rate of 4 per cent for paper maturing 16 to 60 days effective Nov. 26. 2 Rates for commodity paper merged with those for commercial paper of corresponding maturities. V. INVESTMENTS. ANALYSIS OF EARNING ASSETS. Operations during the early part of the year were on a relatively small scale. The total loans and investments made during January were only $3,940,771. In the month of May, when the war financing began, there was a large increase in the amount of loans to member banks and the total loans and investments for the month reached $25,878,818. This amount was almost doubled in June. Operations connected with the second Liberty loan again stimulated borrowings during the latter months of the year, loans made in December amounting t<T $45,025,375. Bills discounted for members during 1917 comprised 67.8 per cent of the total operations, compared with 26 in 1916; bills bought comprised 26 per cent in 1917, compared with 62 per cent the previous year. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 3 PHILADELPHIA. 319 Loans and investments made by months. Total. Month. c m B o e u il m n ls t b e d e d i r — s s - . Bi m l in ls a o r b k p o e e u n t g . ht se U c S u n ta r i i t t t e e i s d es. M wa u r n r i a c n ip ts a . l 1917 1916 January $565,122 $2,107,327 $1,268,322 $3,940,771 $3,012,800 February 1,682,222 10,058,886 25,203 11,766,311 1,948,800 March 3,009,293 4,610,296 $4,598,260 2,575 12,220,424 6,542,700 April 2,385,421 5,268,807 40 126,667 7,780,935 5,296,500 May 20,445,040 5,404,559 29,219 25,878,818 6,562,000 June 42,724,903 3,441,475 46,166,378 7,329,200 July 22,175,858 11,472,425 33,648,283 7,318,400 August 18,170,441 7,450,793 317,700 125,938 26,064,872 4,476,100 September 18,934,001 6,056,282 10,200 25,000,483 7,571,500 October 16,819,730 4,565,180 10,000 21,394,910 7,469,300 November 31,478,602 19,479,626 33,500 50,991,728 9,462,600 December 45,025,375 5,998,140 13,866,050 64,889,565 18,781,700 Total, 1917 223,416,008 85,913,796 18,792,250 1,621,424 329,743,478 85,771,600 Per cent of total 67.8 26.0 5.7 0.5 100.0 Total, 1916 ... $22,328,600 $53,122,000 $2,500,000 $7,823,000 $85,771,600 Per cent increase or decrease, 1917 over 1916. +900 +61 +650 -80 +284 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

320 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. EARNING ASSETS-AVERAGE PAILY AMOUNT OR HAND-1317 FEDERAL "RESERVE BANK OP PHILADELPHIA JAN I F&B [MAR |APR [MAY [JUNE [JULY | AUG [SEPT| OCT |NOVJPEC BILL5 DISCOUNTED MEMBERS CHART NO. 7. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 3 PHILADELPHIA. 321 Average daily holdings of the several classes of earning assets for each month and calendar year 1917. Bills dis- United Total. Month, c m o e u m nt b e e d r — s. Bills bought. se S cu ta r t i e ti s es. M wa u r n r i a c n ip ts a . l 1917 1916 January $766,946 $10,501,049 $2,735,129 $928,012 $14,931,136 $7,722,182 February 902,672 13,884,435 2,016,107 1,432,016 18,235,230 8,140,448 March 1,413,082 11,757,278 2,147,330 1,400,076 16,717,766 11,140,662 April 1.212,746 11,018,096 6,597,280 1,497,731 20,325,853 13,950, 526 May 6', 285,864 12,491,969 6,597,300 1,421,461 26,796,594 16,719,120 June 12,394,010 10,405,492 6,363,966 377,967 29,541,435 17,120,064 July 13,852,692 12,401,444 3,097,300 158,363 29,509,799 18,119,076 August 10,540,930 18,014,284 3,107,558 124,946 31,787 718 17,357,542 September 12,656,277 18,019,258 3,666,040 125,937 34,467,512 17,728,745 October 9,958,904 15,298,910 3,740,400 7,419 29,005,633 18,881,183 November 15,756,446 23,909,654 3,495,700 25,633 43,187,433 17,972,828 December 33,346,433 21,297,307 7,654,381 39,177 62,337,298 22,239,398 Average for year - 9,923,917 14,916,598 4,268,208 628,228 29,736,951 15,590,981 Percent 33.3 50.2 14.5 2.0 100.0 Average for 1916.. $1,005,376 $8,585,000 $3,325,005 $2,675,600 $15,590,981 Per cent increase or decrease, 1917 over 1916. +890 +74 +27 -76 +91 EARNINGS FROM INVESTMENTS. The total earnings during January amounted to $36,836; these were doubled in June, and in December amounted to $194,717. The month of May marked a sudden increase in earnings from bills discounted and loans to members, and in the month of June they exceeded, for the first time, the earnings from bills bought. Earnings from loans and investments for the calendar year 1917. Total. Month. d m is e c B m o i u b ll n e s t r e s d . , bo B u i g ll h s t. se U S cu n ta r i i t t t e e i s d es. M w u a n rr i a c n ip t a s l . 1917 1916 January $3,549 $24,499 $6,981 $1,807 $36,836 $14,512 February... 2,700 31, 613 4,693 3,139 42,145 14,113 March . 4,477 30,441 5,359 3,387 43,664 20,464 April 3,551 26,874 13,028 3,485 46,938 25,619 May ... 17,705 33,769 14,391 3,660 69,525 31,969 June 36,112 26,927 12,862 1,033 76,934 31,464 July- 43,877 33,766 7,828 526 85,997 36,418 August . 33,022 48,597 7,858 434 89,911 35,596 September 38,178 46,982 9,225 419 94,804 36,107 October 31,328 43,065 9,738 39 84,170 40,531 November 47,258 65,373 8,696 85 121,412 37,362 December 108,602 62,746 23,216 153 194,717 52,743 Total, 1917 370,359 474,653 123,875 ' 18,170 987, 057 376,898 Per cert of tota' 37.7 48.0 12.5 1.8 100.0 Total. 1916 28,394 198,243 81,130 69,183 376,898 RATES OF EARNINGS FROM INVESTMENTS. The annual rate of earnings on invested funds as a whole stood at 2.90 per cent at the beginning of the year. With the exception of a recession in the months of April and May, this rate has been Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

322 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. steadily increasing until the rate stood at 4.61 per cent in December. Eeference to the following table shows that the largest rate of return has been from bills discounted for members: Calculated annual rates of earnings from loans and investments. I Bills dis- Bills United Total. counted, bought States Munici- Month. mem- in open securi- pal warbers. market. ties. rants. 1917 1916 January— 0.0398 0.0279 0.0299 0.0313 0.0290 0.0221 February... .0301 .0296 .0303 .0285 .0301 .0218 March .0373 .0304 .0293 .0284 .0307 .0216 April .0376 .0396 .0248 .0292 .0290 .0224 May .0328 .0396 .0248 .0293 .0298 .0225 June .0354 .0314 .0245 .0332 .0316 .0224 July .0372 .0320 .0297 .0391 .0343 .0237 August .0368 .0317 .0297 .0409 .0333 .0242 September. .0367 .0317 .0306 .0405 .0334 .0248 October .0370 .0331 .0306 .0406 .0341 .0253 November. .0364 .0332 .0302 .0405 .0342 .0253 December.. .0383 .0346 .0357 .0461 .0461 .0280 Average for 1917. .0373 .0318 .0290 .0289 .0332 .0242 Average for 1916. .0370 .0231 .0256 .0258 .0242 DISTRIBUTION BY MATURITIES OF BILLS DISCOUNTED, ACCEPTANCES, AND WARRANTS. The following table shows the total amount of bills, notes, and warrants discounted and purchased by the bank during the year, distributed by maturities. Borrowings incident to the placing of war loans were largely accomplished by obligations having a maturity of 15 days and less. The liquidity of the bank is indicated by the large proportion of maturities within 15 days it has carried. Bills discounted, acceptances, and warrants distributed by maturities and months for the calendar year 1911. 1-15 days. 16-30 days. 31-60 days. 61-90 davs. O d v a e y r s 9 . 0 Total. January $247,937 $226,503 $850,008 $1,086,242 $1,530,081 $3,940,771 February 1,307,784 2,027,128 3,329,446 5,047,077 54,876 11,766,311 March 2,667,902 1,061,570 1,055,263 2,616,577 220,852 7,622,164 April 2,208,142 874,599 911,719 3,656,296 130,139 7,780,895 May 18,545,006 2,785,098 1,480,976 2,776,111 291,627 25,878,818 Tune 39,039,795 1,839,122 1,785,845 3,475,321 26,295 46,166,378 July 19,000,985 1,429,165 1,819,689 8,729,150 2,669,294 33,648,283 August 24,596,145 914,557 1,983,641 7,926,931 35,747,172 September 17,175,492 1,205,851 1,637,175 4,826,189 145,576 24,990,283 October 11,962,123 1,684,876 1,257,125 6,068,941 421,845 21,394,910 November 17,859,511 3,375,295 9,067,163 20,575,808 113,951 50,991,728 December 32,125,650 6,448,283 3,886,982 8,562,600 51,023,515 Total, 1917 186,736,472 23,872,047 29,065,032 75,347,243 5,930,434 320,951,228 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 3 PHILADELPHIA. 323 MATURITIES OP EARNING ASSETS (EXCLUSIVE Of UNITED STATES SECURITIES) FEDERAL RESERVE BANK OP PHILADELPHIA CHART NO. 8. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

324 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. The maturities of the bank's earning assets on the last Friday of the year are shown in the following table: Distribution by maturities of paper and short-term investments held by the Federal Reserve Bank and the Federal Reserve Agent at close of business Dec. 28, 1917. Maturities— Total. Within 15 From 16 to From 31 to From 61 to days. 30 days. 60 days. 90 days. 1. Bills discounted—members: Commodity paper $26,950 $11,000 $10,000 $47,950 Trade acceptances $74,658 1,715 48,782 17,329 142,484 Member banks' collateral notes 5,845,996 5,845,996 All other 14,956,692 2,848,048 i3,073,44i 2,606,095 33,484,275 Total 20,877,346 2,876,713 13,133,223 2,633,424 39,520,705 2. Acceptances bought: Bankers' acceptances- Foreign 1,392,467 4,847,303 3,428,027 3,822,999 13,490,796 Domestic 730,598 1,702,205 1,384,917 617,100 4,434,820 Dollar exchange bills (sec. 13, amended).. . . Trade acceptances- Foreign 12,189 273,899 205,559 491,547 Domestic Total 2,135,154 6,823,407 5,018,503 4,440,099 18,417,163 3. Rediscounts for other Federal reserve banks 4 Short-term investments . .. 10,000 10,000 Grand total 23,022,500 9,700,120 18,151,726 7,073,523 57,947,868 Amounts of the several classes of discounted paper held by the Federal Reserve Bank and the Federal Reserve Agent on above date. Secured. Unsecured. Total. Agricultural paper $187,639 $187,639 Commercial and industrial paper $16,514,814 16,972,257 33,487,071 Member banks' collateral notes 5,845,996 5,845,996 All other, n. s Total bills discounted 22,360,810 17,159,896 39,520,706 Collateral Notes and Bills Discounted—Members. Borrowings by member banks, in the form of collateral notes, increased from $1,807,700 in April to $15,229,000 in May and $35,690,- 499 in June, when they were almost entirely secured by bills receivable. Each month from May showed an increase in the amount of notes secured by United States bonds or Treasury certificates of indebtedness. In December they amounted to $9,550,501 and notes secured by bills receivable amounted to $1,657,250. Discounts of bills receivable increased from $5,216,040 in May to $7,034,954 in June, reaching the large total of $33,817,624 in December. The notes rediscounted Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 3 PHILADELPHIA. 325 ranged in size from a few dollars to $250,000. During 1916, earnings from bills discounted and collateral notes were only 9 per cent of the total, whereas in 1917 they were 38 per cent. Bills discounted during each month by classes of paper; earnings from discounts and average rates of monthly and annual earnings for the calendar year 1917. Members-collateral Earnings. S TU e Tn c b i u ?t r e e Ad d j [o s t e h c e u r r w ed is . e a T a c n r c c a e e d p s e t . - p C m a i o t o p y m d e - r - . d A i l s l c o ou th n e t r s. Total. A b m a v o f l e o a n r n r a t c h g e . e Amount. Aver- States securities. January $230,000 $15,164 $319,958 $565,122 $766,946 $3,549;0. 0398 February 475,000 21,7721 1,185,501 1,682,222 902,672 2,700 .0301 March 1,605!000 29,7730 1,374,563 3,009,293 1,413,082 4,477 .0373 April 1,307!700 24,1199 1,053,522 2,385,421 1,212,746 3,551 .0376 May $880,000 14,349^000 25,7758 5,190,282 20,445,040 6,285,864 17,705 .0328 June 680,650 35,009,849 78,3343 6,956,061 42,724,903 12', 394; 010 36,112 .0354 July 1,691,650 16,515,320 36,874 $25,000 3,907,014 22,175,85813,852,692 43,877 .0372 August 2,110,000 10,192,990 26,200 5,747,092 18,170,44110,540,930 33,022 .0368 September 5,532,500 10,082.190 3,303,022 18,934,00112,656,277 38,178 .0367 October 3.002,500 8,714,811184', 25,000 4,892,718 16,819,7309,958,904 31,328 .0370 November 9,209,425 7,755,505100, 29,00014,384,533 31,478.60215.756,446 47,258 . 0364 December 9.696,501 1,511,250! 99, 22,950 33,695,673 45,025!375 33; 346,433 108,602 .0383 Total, 1917..32,803.226 107,748,615 726,078 128,150 82,019,939 223,416,008 9,923,9171 370,359; .0373 Total, 1916.. 13,644,2681 74,800 8,609,53"2" ~2*2 ,3"~2"8 ,6—00 1,005,376 28,395 .0370 Amount of paper {exclusive of bankers' acceptances) discounted for member banks, distributed by maturities as of date of discount; also number of banks in district and banks accommodated during each month in the calendar year 1917. Mem- Total. Mem- ber i b n a b n e d k r is s -a b c a c n o k m s - 1 o 5 r l d e a s y s s . d 1 a 6- y 3 s 0 . d 31 a - y 6 s 0 . d 61 a - y 9 s 0 . O da 9 v y 0 e s r . trict. mo- 1917 dated. January 031 14 $247,937 $120, $184,102 $12,080 $800 S565, $242,773 February... 632 18 1,149,757 205, 231,028 88,294 4,876 1,682, 109,247 March 632 17 2,667,902 74, 234,570 30,769 1,610 3,009, 212.010 April 631 16 2,164,269 137, 53,762 26,477 3,472 2,385, 922^ 680 May 630! 43 18,545,006 1,283, 338,565 268,424 9, 52920,445, 1,590,123 June 628! 79 38,818,843 1,674,570 1,640, 491 589,704 1, 29542, 724, 945,730 July 628! 64 38,862,985 403, 940,462 966,750 1,870 22.175, 1,380,125 August 628| 67 14,596,145 394. 256,472 923, 701 18,170, 739,515 September. 627! 76 17,174,648 568, 717, 629 469,187 18,934, 546,346 October 627j 79 11,962,123 509, 716,249 "~">, 4482,425 16,819, 307,303 November.. 630; 116 17,462,072 708,987 1,575,537 11,731,106 900 31,478, 3,415,021 December.. 636; 139 32,125,650 6,206,425|2,897,808! 37,95,492 45,025, 11,917,727 Total 175,777,337112,286,573 9,789,675j25,531,43230,991 223,416,008 22,328,600 Per cent of total 78.7 5.5 4.3 11.4 . 1 100.0 ACCEPTANCES BOUGHT IN THE OPEN MARKET. The total amount of bills bought in the open market amounted to $85,913,796, compared with $53,122,000 the previous year. The Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

326 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. average rate of return for the year was 3.18 per cent compared with 2.31 per cent in 1916. Acceptances in the open Earnings. Bankers' Trade Average i accept- accept- Total. balance j I ances. ances. for month, j Amount. Averag rate. January $2,095,200 $12,127 $2,107,327 $10,501,049 $24,499 0.0279 February 9,974,000 10,058,886 13,884,435 31,613 .0296 March 4,610,296 4,610,296 11,757,278 30,441 • .0304 April 5,288,809 5,268,807 11,018,096 26,874 .0306 May 5,355,600 48,959 5,404,, 559 12,491,969 33,769 .0396 June 3,208,600 232,875 3,441,475 10,405,492 26,927 .0314 July 11,208,800 263,625 11,472,425 12,401,444 33,766 .0320 August 7,007,900 442,893 7,450,793 18,014,284 48,597 .0317 September 5,950,470 105,812 6,056,282 18,019,258 46,982 .0317 October 4,565,180 4,565,180 15,298,910 43,065 .0331 November 18,786,857 692,769 19,479,626 23,909,654 65,373 . 0332 December 5,944,691 53,449 5,998,140 21,297,307 62,746 .0346 Total, 1917. 83,976,401 j 1,937,395 ! 85,913,796 14,916,598 474,653 .0318 Total, 1916. 51,769,000 | 1,353,000 | 53,122,000 8,585,000 198,243 .0231 Bill a bomjht, distributed by maturities. Total. ays-131~ 61-90 days. Over 90 1917 1916 January $106,300 $665,906 $1,074,162 $260,959 $2,107,327 $194,000 February... $158,027 1,821,861 3,095,418 4,933,580 50,000 10,058,886 709,000 March 987,128 820,693 2,585,808 216,667 4,610,296 4,759,000 April 43,873 737,158 857,957 3,629,819 5,268,807 3,990,000 May 1,501,582 1,142,411 2,507,687 252,879 5,404,559 4,109,000 June 220,952 164,552 145,354 2,885,617 25,000 3,441,475 5,766,000 July 138,000 1,025,374 879, 227 6; 762,4002,667,424 11,472,425 5,049,000 August 520,434 1,601,231 5,003,230 325,898 7,450,793 3,661,000 September.. 844 637,528 919,546 4,357,002 141,362 6,056,282 6,591,000 October 1,175,391 540,876 2,429,493 419,420 4,565,180 5,962,000 November.. "397," 439 2,666,308 7,458,126 8,844,702 113,051 19,479,626 5,670,000 December.. 241,858 989,174 4,767,108 5,998,140 6,662,000 Total, 1917 959,135 I 11,585,474 19,115,919 49,780,608 4,472,660 85,913,796 53,122,000 Per cent 1.1 13.5 22.2 58.0 5. 2 100.0 Total, 1916 110,322.000 11,566,000 231,324,000 : 53,122,000 1 Within 30 days. 2 Sixty days and over. UNITED STATES SECURITIES. Early in the year the Federal Reserve Board announced that Federal Reserve Banks would not be required to purchase during the year more than $15,000,000 United States 2 per cent bonds from, member banks, and such bonds would have to be offered to the Treasury Department on or before March 21. The aggregate of bonds offered amounted to $10,877,500, of which amount $1,098,200 was allotted to the Federal Reserve Bank and paid for on April 1. Sub- Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 3—PHILADELPHIA. 327 sequently $549,200 was converted into United States 3 per cent bonds, and $549,000 into one-year 3 per cent notes. In connection with the Government financing, the bank has from time to time taken over blocks of bonds and certificates of indebtedness, which were disposed of later. Income from this class of investment amounted to $123,875. The average rate of return was 2.90 per cent. Profits realized from the sale of United States securities amounted to $13,768. The following tables show the holdings of United States securities: United States securities. Income. Amount Average purchased. balance. Amount. Rate January $2,735,129 $6,981 0.0299 February.. 2,016,107 4,693 . 0303 March §4,598,200 2,147,330 5,359 .0293 April 40 6,597,280 13,028 .0248 May 6,597,300 14,391 .0248 June 6,363,966 12,862 .0245 July. 3,097,300 7,828 .0297 August 317,700 3,107,558 7,858 .0297 September. 10,200 3,666,040 9,225 .0306 October — 3,740,400 9,738 .0306 November. 3,495,700 8,696 .0302 December.. 13,866,050 7,654,381 23,216 .0357 Total 1917 . 18,792,250 4,268,208 123,875 .0290 Total 1916 . 2,500,000 3,574,000 81,130 .0256 United States securities held on last day of each month. United States bonds with circulation United States bonds without circulation privilege. privilege. United States Treasury certificates of 3per cent 2 d c p a o 1 e t n 9 e 3 r s d 0 o c . l o e i n - f t 1 P 2 9 a p 3 n e 6 a r - 1 m c 9 e a 3 n , 8 t . 2 p in er d e c b e t n e t d . nes 3 s - c . 4 e n p t e . r 1 c b 9 o o s 4 n i n 6 o v d - n e 4 s r 7 , - . 3 o p n n e e o r - t y e c e s e a . n r t • L i l b o e an rt . y T 1 o 91 t 7 a . l, January $137,000 $1,999,000 $2,135,000 February 1,999,000 1,999,000 March $1,092,000 $6,260 $3,500,000 1,999,000 6,597,260 April 100 3,500,000 549,200 2,548,000 6,597,300 May 100 3,500,000 549,200 2,548,000 6,597,300 June .. . 100 549,200 2,548,000 3,097,300 July 100 I 549,200 2,548,000 3,097,300 August 100 i 549,200 2,548,000 $317,700 3,415,000 September 100 $658,000 549,200 2,548,000 632,500 4,387,800 October.. 100 577,000 549,200 2,548,000 1,100 3,675,400 November 100 205,000 549,200 2,548,000 1,100 3,303,400 December. 100 549,200 2,548,000 6,552,650 9,649,950 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

328 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. MUNICIPAL WARRANTS. Investments in municipal warrants have been very much less than during the previous year. It became apparent early in the year that there would be abundant investment for the bank's funds in rediscounting and open-market operations, and the purchase of municipal warrants was discouraged. Municipal warrants. Earnings. City Other Average warrants. warrants. balance. Amount. Rate. January $1,268,322 $1,268,322 $928,012 $1,807 0.0313 February 25,203 25,203 1,432,016 3,139 .0285 March 2,575 2,575 1,400,076 3,387 .0284 April . 126,667 126,667 1,497,731 3,485 .0292 May 25,219 $4,000 29,219 1,421,461 3,660 .0293 June 377,967 1,033 .0332 July 158,363 526 .0391 August . 125,938 125,938 124,946 434 .0409 September 125,937 419 .0405 October 10,000 10,000 7,419 39 .0406 November 33,500 33,500 25,633 85 .0405 December 39,177 153 .0461 Totals 1917 1,573,924 47,500 1,621,424 628,228 18,170 .0289 Totals 1916 7,823,000 2,675,600 69,183 .0258 Warrant a putvhased (luring 1917, distributed by maturities. Total. 60 days. 90 days. O d v a e y r s 9 . 0 1917 1916. January... . . . .. $1,268,322 $1,268,322 $1,576,000 February $25,203 25,203 630,600 March 2 575 2,575 855,700 April 126,667 126,667 100,000 May 29,219 29,219 862,800 j une . . .. 617,600 Julv 889,800 August. $125 938 125,900 75,600 September 434,200 October 10,000 10,000 1,200,300 November 33 500 33,500 378,200 December 202,200 Total. 159,438 37,778 1,424,208 1,621,424 7,823,000 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 3 PHILADELPHIA. 329 VI. FEDERAL RESERVE NOTE ISSUES. The comparative statement of condition of the Federal Reserve agent's accounts follows: Comparative statement of the Federal Reserve Agent1 s accounts. Dec. 31, Tec. 30, Deo. 31, 1917. 1916. 1915. RESOURCES. $10,160,000 $7,260,000 $2,680,000 Federal Reserve notes outstanding 97,325,755 17,069,590 9,160,000 Federal Reserve notes sent to Comptroller of Currency for destruction . . 17,994,245 6,150,410 640,000 Bills to secure Federal Reserve notes 34,855,506 1,300,000 Funds to redeem Federal Reserve notes: Gold coin and certificates on hand 4,220,000 3,730,000 4,160,000 Lawful money on hand Gold redemption fund 4,966,755 859,590 Gold with Federal Reserve Board 54,759,000 11,180,000 5,000,000 Total 63,945,755 15,769,590 9,160,000 Total resources... 224,281,261 47,549,500 21,640,000 LIABILITIES. Federal Reserve notes received from Comptroller of Currency (gross amount) 125,480,000 30,480,000 12,480,000 Collateral received from Federal Reserve Bank 34,855,506 1,300,000 Provision for redemption of Federal Reserve notes 63,945,755 15,769,590 9,160,000 Total liabilities. 224,281,261 47,549,500 21,640.000 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

330 ANNUAL REPOET OF THE FEDERAL RESERVE BOARD. FEDERAL RESERVE NOTES ISSUED BY FEDERAL RESERVE AGENT FEDERAL RESERVE BANK OP PHILADELPHIA MILLIONS MILLIONS OP DOLLARS DFD0LLAR5 140 HO 130 130 120 120 110 110 100 100 90 90 80 80 70 70 60 60 50 50 40 40 30 30 EO 20 10 10 DEC 31.1915 . DEC 30.1916 DEC 31.1917 NOTES CANCELLED NOTES IN HANDS . NOTES 15SUED TO OF THE FEDERAL BANK BY THE FEDERAL AND DESTROYED RESERVE AGENT B&5ERYE AGEKT. CHABT No. 9. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 3 PHILADELPHIA. 331 The demand for currency has been heavy, due to the abnormal activity in all lines of business. The act of the Pennsylvania Legislature, making Federal Eeserve notes a part of the lawful reserve of State institutions, effected the exchange of a considerable amount of gold held by such institutions for Federal Eeserve notes. The amendment to the Federal Eeserve Act, depriving vault cash of its former character of bank reserve, and requiring that all member bank reserves be carried with the Federal Eeserve Bank exclusively, also induced the member banks to exchange their gold for Federal Eeserve notes. ISSUE OF NOTES BY MONTHS. The amount of notes in circulation increased steadily, as shown by the following table: Federal reserve notes issued and in actual circulation. In actual circulation Held by at end of month. O a m t u i n b t o s g e n t g a o t i n h f n d . - - m d Is u o s r u n i e n t d h g . de E em e- ed. i O o n f g u m t a st t o a n e n n t d h d - . B R F e e a e n d n s d e e k r r o v a a f e l t month. 1917 1916 January... $17,069,590 $240,900 $16,828,690 $741,595 $16,087,095 $8,098,555 February.. 16,828,690 $6,060,000 785,220 22,103,470 1,253,975 20,849,495 7,485,050 March 22,103,470 4,040,000 433,200 25,710,270 1,372,835 24,337,435 7,062,455 April 25,710,270 5,280,000 557,700 30,432,570 1,335,445 29,097,125 6,655,055 May 30,432,570 4,400,000 529", 500 34,303,070 1,123,155 33,179,915 6,156,380 June 34,303,070 8,400,000 797,400 41,905,670 2.116,850 39,888,820 6,679,130 July 41,905,670 1,000,000 701,710 42,203,960 846,920 41,351,040 7,322,000 August 42,203,960 4,100,000 831,900 45,472,060 2,269,400 43,202,660 6,920,010 September. 45,472,060 10,700,000 1,353,925 53,318,135 2,291,625 51,026,510 7,134,080 October... 53,318,135 14,700,000 1,698,250 65,528,385 4,415,280 61,113,105 8,047,290 November. 65,528,385 17,000,000 1,173,720 81,354,665 2,930,265 78,424,400 12,601,630 December. 81,354,665 17,920,000 1,948,910 97,325,755 4,348,590 92,977,165 16,898,450 34365° Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

332 ANNUAL REPOET OF THE FEDERAL RESERVE BOARD. GOLD AMD COLLATERAL HELD BY FEDERAL" RESERVE AGENT A3 SECURITY FOR FEDERAL RESERVE NOTES OUTSTANDING FEDERAL RESERV6 BANK-OP PHILADELPHIA JAN FEB WAR APR MYUUNCUULY AUC 5CPT OCT NOV DEC FEDERAL RESERVE N0TE3 OUTSTANDING =100 % CHART NO. 10. DENOMINATIONS. Notes of the denominations of $10 and $20 were especially in demand and were issued in large quantities, the following table showing the amount of each denomination issued: Denominations of Federal Reserve notes issued during 1917. Total. Fives. Tens. Twenties. Fifties. Hundreds. 1917 1916 January.. February $100,000 $2,280,000 $3,680,000 $6,060,000 $325,000 March 360 000 2 400 000 1 280'000 4,040,000 April. . 480,000 2,080,000 2,720,000 5,280,000 May 200,000 1,080,000 2,720,000 $400,000 4,400,000 June 1 160,000 2,680,000 3 360,000 $400,000 800,000 8,400,000 1,472,700 July 520,000 480,000 1,000,000 900,000 August 420 000 1 160,000 1 920,000 200,000 400,000 4,100,000 September . . 1 720 000 4,140,000 3,600,000 890,000 350,000 10,700,000 680,000 October.... 9, 300,000 4,680,000 4,720,000 1,800,000 1,200,000 14,700,000 1,360,000 November.. 1, 200,000 4,800,000 6,800,000 1,000.000 3,200 000 17,000,000 6,080,000 December... 3,160,000 4,920,000 7,040,000 1,600,000 1,200,000 17,920,000 3,340,000 Total 1017 11,100,000 30,794,000 38,320,000 5,890,000 7,550,000 93,600,000 Per cent of total 11 9 32 8 40 9 6 3 8 1 100 Digitized for FRA T S ot E al R 1 916 5, 752,700 3,974,800 4,430,200 14, .157,700 http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 3 PHILADELPHIA. 333 Interdistrict movement of notes. In the following table are shown the amounts of the bank's own Federal Reserve notes received back from other Federal Reserve Banks, also amounts of notes of other Federal Reserve Banks returned to the latter by this bank during 1917: Interdistrict movement of Federal Reserve notes. Received Returned from— to— Boston. $634,700 $388,000 New York 5,876,300 11,553,902 Cleveland. ' 258,495 883,000 Richmond 323,920 798,000 Atlanta.. 150,650 311,000 C h i c a g o .. . . .. . . .. 357,500 419,000 St. Louis 90,600 113,000 Minneapolis 17,000 122', 000 "Kansas City . .. .... . .. 11,600 129,000 Dallas 314,450 101, 000 San Francisco 31,575 163,000 Total 1917.. 8,066,790 14,960,902 Total 1916 2,110,175 4,411,975 VII. INTERNAL MANAGEMENT OF THE BANK. Directors Federal Reserve Bank of Philadelphia. [Richard L. Austin, chairman and Federal Reserve agent. H. B. Thompson, deputy chairman. Charles J. Rhoads, governor.] Class. Name. Residence. Term expires. {Group ] Charles J. Rhoads Philadelphia, Pa.. Dec. 31,1917 Group S William H. Peck Scranton, Pa Dec. 31,1918 Group c M. J. Murphy. Clarke Green, Pa.. Dec. 31,1919 {Group 1 A. B. Johnson Philadelphia, Pa.. Do. Group 5 E. S. Stuart .do.. Dec. 31,1917 Group I G. W. F. Gaunt.. MullicaHill, N. J. Dec. 31,1918 rRichard L. Austin Philadelphia, Pa.. Dec. 31,1917 H. B. Thompson Wilmington, Del.. Dec. 31,1919 J. Davis Brodhead l Bethlehem, Pa Dec. 31,1918 1 Resigned Dec. 12, 1917. DIRECTORS AND OFFICERS. Mr. Levi L. Rue, president of the Philadelphia National Bank, was reelected as a member of the Federal Advisory Council to represent the Third Federal Reserve District. In accordance with the amendment to the Federal Reserve Act approved June 21, Mr. H. B. Thompson became deputy chairman instead of deputy chairman and deputy Federal Reserve Agent. The office of assistant Federal Reserve Agent having been created, Mr. Arthur E. Post, who had acted as assistant to the Federal Reserve Agent, was appointed to that position. On August 1 Mr. Frank M. Hardt, cashier, was elected deputy governor and cashier, and on July 3 Mr. C. A. Mcllhenny, then an officer of the Bank of Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

334 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. North America, was elected an assistant cashier, and on December 19 Mr. W. J. Davis was also elected an assistant cashier. These additions to the officers' staff were made necessary by the great in-, crease in the business of this institution. The board of directors continued without change during the year until December 12, wiien the Hon. J. Davis Brodhead felt compelled to resign because of having accepted a position with the Custodian of Alien Property. The regular elections for a class A and a class B director were held from November 20 to December 4. Mr. Charles J. Ehoads, governor of the bank, though eligible for reelection as a class A director, declined to be a candidate, as he believed it to be for the best interests of the bank to have elected as class A directors men who are actively connected with member banks and are thus in a position to represent the stockholders. As the result of the election, Joseph Wayne, jr., w7as elected a class A director by group 1 banks and Hon. Edwin S. Stuart was reelected a class B director by group 2 banks. The votes cast were as follows: GROUP 1, CLASS A. Candidates. First Socond Third choice. choice. choice. William Bromor, vice president National Bank ofSchwenksville, Schwenksville, Pa 11 128 Allen P. Perley, president West Branch National Bank, Williamsport, Pa 128 14 Joseph Wayne, jr., president Girard National Bank, Philadelphia 142 GROUP 2, CLASS B. Robert Brown, manufacturer, Stroudsburg, Pa 52 John C. Ogdcn, general superintendent Cambria Steel Co., Johnstown, Pa... 19 Edwin S. Stuart, merchant, Philadelphia, Pa 2 At the close of the year the bank had 6 officers and 186 clerks, a total of 192, as compared with, 4 officers and 85 clerks at the end of the previous year. Of this increase in the clerical force, the greatest number has been added to the transit department. The wTork of the teller's department has become heavy, due to the large amount of cash handled daily, and it was necessary to add 15 note counters to the force there. The issues of Liberty bonds have added greatly to the wrork of the fiscal agent's department. Its force was increased in order to handle the work incident to the payment of interest on Government bonds, the payment of Government checks, the handling of war-savings stamps, etc. The force of clerks in this department will probably have to be further increased. The war has thrown much work on the Federal reserve bank, which it had neither the clerical force nor the equipment to properly Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT JSTO. 3—PHILADELPHIA. 335 handle. The quarters of the bank are inadequate and the work was conducted under the greatest handicaps. Notwithstanding these difficulties the officers and clerks have labored without complaint, being on duty long hours, frequently working well into the night— ene department working 40 hours at one stretch—in order to complete in time the figures in connection with the bond issues. It is with great pleasure and due appreciation of these services that this acknowledgment is made of the faithful, efficient, and selfsacrificing work of the officers and clerks of this bank during the year. TRANSIT DEPARTMENT. The check-collection system inaugurated in May, 1916, has been expanded and improved and is becoming of daily increasing service to member banks. The average number of checks handled in the month of January was 9,104, and their value was $7,038,420. The average number handled in December was 15,762, and the value $18,037,952, an increase of 73 per cent in the number and of 156 per cent in the value of items handled during the last and first months of the year. Of the 427 nonmember banks in the district, 310 are now taking items for remittance at par, a gain for the year of 78, and we have hopes that before long all nonmember banks will be included in our list. There are 65 clerks in the transit department, an increase for the year of 25. The cost of the department, including charges on the shipments of money, was $101,701. Of this amount $79,582 was reimbursed through the service charge of 1J cents per item, leaving a balance of $22,120 of the cost of the department to be borne by the bank. Transit department operations. Disburse- Expenses of De t p i r o e n cia- Total Service ments in operation. charges. expense. charges. exesss oi service charges. January $6,372 $308 $6,680 $6,243 $437 February... 5,440 385 5,825 5,694 131 March 6,361 392 6,753 6,444 309 April 5,890 393 6,283 6,543 1260 May 5,836 370 6,206 6,062 144 June 6,825 395 7,220 6,403 817 July 7,261 398 7,659 6,683 976 August 8,917 408 9,325 7,570 1,755 September. 9,284 409 9,693 5,560 4,133 October.... 9,836 425 10,261 7,875 2,386 November.. 10,244 426 10,670 6,518 4,152 December.. 13,249 507 13,756 7,987 5,769 Total, 1917. 95,515 6,185 101,701 79,582 22,120 Total, 1916. 34,241 5,000 39,241 4,000 1 Service charges in excess of disbursements. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

OOft ANNUAL ItEPOBT OF THE FEDERAL RESERVE BOARD. OOO TRANSIT DEPARTMENT OPERATIONS AVERAGE NUMBER OP ITEMS HANDLED,DAILY FEDERAL "R&S£RV£ 5ANK Or PHILADELPHIA MUMbER 1917 OF OP ;ULY AUC SEPT OCT ROY DECJAN FEb /AARjAPR KAY JUNE|JULY AUG[S£?TJOCT[NOV|D&C ITEMS 50,000 KfcY 50,000 IT&IAS OH ALL 3ANKS 45,000 IT &nS ON BANKS 1MTH15 DISTRICT 45,000 A lT£ttS OR PHILADELPHIA 5ANK5 IT£MS OKI BANKS IN OTHER DISTRICTS 40,000 40,00,0 35,000 35.000 30.000 30000 s 25.000 E5.000 so.aoo 20,000 15.000 15 000 10,000 10,000 5,000 5,000 CHART NO. 11. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT KO. 3 PHILADELPHIA. 337 Total number and amount of checks handled monthly and during the calendar pear 1917. On country banks in this On Philadelphia banks. district. Number. Amount. Number. Amount. 1917. January 236,705 $182,998,925 404,966 $52,170,483 February.. 209,967 199,859,376 349,088 46,345, 061 March 258,170 246,290,587 445,015 54,268,671 April 271,590 255,466,069 375,565 56,344, 330 May 294,068 292,196,057 435,497 62, 575, 6b i Juiie 297,818 344,434,393 429,996 63? 741, 041 July 325,518 302,315,872 453,704 67,128, 277 August 328,261 327,342,255 497,679 68,456, 648 September. 293,780 284,939,508 431,250 68,090, 876 October 367,892 397,418,830 514,031 80,355,151 November. 370,357 419,819,276 476,590 76,022.606 December.. 394,055 450,948,801 526,329 83,281,933 Total, 1917. 3,648,181 3,704,029,949 5,339,710 778,780,708 Total, 1916. 1,121,179 1,301,401,864 2,679,110 312,245,482 On banks in other reserve cities. Total. Number. Amount. Number. Amount. 1917. January 157,938 $153,902,963 799,609 $389,072,371 February 143,180 140,741,052 702,235 386,945, 489 March 167,366 178,894,749 870,551 479,454,007 April 163,116 186,862,433 810,271 498,672, 832 May 178,405 221,114,500 907,970 575,886,188 June 178,243 244,368,130 906,057 652,543,564 July 199,866 207,465,530 979,088 576,909, 679 August 203,435 223,313,333 1,029,375 619,112, 236 September 203,538 239,951,955 928,568 592,982, 339 October 257,420 289,379,806 1,139,343 767,153,787 November 249,609 278,349,990 1,096,556 774,191, 872 December 262,265 299,336,688 1,182,649 833,567,422 Total, 1917 2,364,381 2,663,681,129 11,352,272 7,146,491,786 Total, 1916 670,454 999,204,762 4,470,743 2,612,852,108 Average number of items handled dally. On Philadelphia On country banks On banks in other banks. in this district. reserve cities. Total. Number. Amount. Number. Amount. Number. Amount. Number. Amount. 1917. January 9,104 $7,038,420 15,576 $2,006,557 6,074 $5,919,345 30,754 $14,964,322 February 9,544 9,084,517 15,868 2,106,594 6,508 6,397,320 31,920 17,588,431 March 9,562 9,121,874 16,482 2,009,951 6,199 6,625,731 32,243 17,757,556 April 11,316 10,644,420 15,649 2,347,680 6,796 7,785,935 33,761 20,778,035 May. 11,310 11,238,310 16,750 2,406,755 6,862 8,504,404 34,922 22,149,469 June 11,454 13,247,477 16,538 2,451,578 6,856 9,398,774 34,848 25,097,829 July 13,021 12,092 635 18,148 2,685,131 7,995 8,298,621 39,164 23,076,387 August... 12,157 12,123,787 18,433 2,535,431 7,535 8,270,864 38,125 22,930,082 September... 12,241 11,872,479 17,969 2,837,120 8,480 9,997,998 38,690 24,707,597 October 14,150 15,285,340 19,770 3,090,582 9,901 11,129,993 43,821 29,505,915 November 15,432 17,492,470 19,858 3,167,609 10,400 11,597,916 45,690 32,257,995 December 15,762 18,037,952 21,053 3,331,277 10,491 11,973,467 47,306 33,342,696 Total, 1917. 12,087 12,273,306 17,674 2,581,355 7,481 8,825,030 37,603 23,679,692 GOLD SETTLEMENT FUND. The gold settlement fund lias been of great use in settling balances between Federal Reserve Banks and large amounts were cleared Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

338 ANNUAL EEPOET OF THE FEDEEAL EESEEVE BOARD. weekly. The following table shows the summary of operations and the net trains and losses: Gold settlement operations. 000's omitted.) Gold. Transfer. Total of weekly statements for Balance Balance period. after Period covered. last close state- of busiment. d W ra i w th n - . D it e e p d o . s- Debit. Credit. de N b e it t s. d T e o b t i a ts l . c T re o d t i a t l s. cr N ed e i t ts. p n e e r s i s o f d o . r Dec. 22, 1916, to Jan. 25, 1917 15,105 11,300 1,885 3,044 3,932 185,411 195,564 14,115 15,117 Jan. 26 to Feb. 23, 1917 15,117 1,000 550 10,523 158,109 154,297 6,711 ' 10,855 Feb. 24 to Mar. 22, 1917 10,855 4,300 1,690 159,994 169,190 9,196 17,441 Mar. 23 to Apr. 19, 1917 17,441 6,699 300 552 1,586 177,742 184,147 9,167 18,071 Apr. 20 to May 17, 1917 18,071 4,120 4,500 26,300 2,919 199,413 212,116 15,622 4,854 May 18 to June 21, 1917 4,854 3,200 550 32,000 257,653 310,882 53,229 23,433 June 22 to July 19, 1917 23,433 1,520 140 19,000 9,147 207,104 220,023 22,066 15,972 July 20 to Aug. 23, 1917 15,972 2,250 20, 761 43,000 4,751 278,639 314,023 40,135 26,867 Aug. 24 to Sept. 19, 1917 26,867 2,150 27,383 38,131 11,025 234,807 248,211 24,429 27,376 Sept. 20 to Oct. 18, 1917 27,376 32,800 30,740 7,000 13,000 1,698 253,398 264,029 12,329 41,947 Oct. 19 to Nov. 21, 1917 41,947 59,950 44,965 79,000 357,168 442,717 85,549 33,511 Nov. 22 to Dec. 20, 1917 33,511 69,570 73,015 45,000 1,000 9,590 317,400 337,281 29,471 12,837 COLLECTION DEPARTMENT. On September 1, 1917, a collection department was established. Items received for the first four months were as follows: N of u i m te b m e s r Amount. N p u a m id b . er Amount. r N e u tu m rn b e er d. Amount. handled. September 80 $89,239 74 $79,553 » $8,836 October. 154 367,246 146 363,907 8 3,339 November 186 664,065 174 661,604 12 2,461 December 242 1,143,353 219 1,119,912 23 23,440 The greater proportion of this business comes through other Federal Reserve Banks and consists of drafts with bills of lading attached, coupons, notes, and checks on which special advice of payment is requested. The only charges made have been our service charge of 10 cents per item, none of the remitting or crediting banks having made any charge for exchange during the period mentioned in the above table. GOVERNMENT DEPOSITS. The work in connection with the Government department has grown considerably. During the year 375,276 Government checks, amounting to $216,604,043 were handled, 5 clerks being regularly assigned to this work. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. C PHILADELPHIA. 339 VIII. GENERAL BANKING CONDITIONS IN THE DISTRICT AND RELA- TIONS WITH MEMBER BANKS. On January 1, 1917, there were G31 member banks in the district. During the year 4 national banks were organized; 6 went out of existence, and 7 State institutions joined the system, making a total membership of 636. We give below a table showing the relation of the Third Federal Reserve District compared with the districts of the other banks. It is interesting to note that while the area of the district is c:ily 1.2 per cent of the entire area of the country, the population is 6.4 pet cent and the resources of the member national banks 8.1 per cent. Total Number Fed d er is a t l r i R c e t. serve Population. c P e e n r t. S m q i u le a s re . c P e e n r t. r b e m a so n e u k m r s c b e (0 e s 0 r o 0 f c P e e n r t. m na e t m i o o f b n e a r l c P en er t. omitted). banks. Boston 6,963,987 6.7 61,345 2.0 $1,144,154 6.9 388 5.1 New York 13,111,816 12.7 51,890 1.8 4,478,494 27.1 624 8 2 Philadelphia.. . . 6,632,611 6.4 36,844 1.2 1,338,811 8.1 627 8.3 Cleveland 9,314,762 9.0 73,310 2.5 1, 719, 441 10.4 751 9.8 Richmond 9,278,461 9.0 152,314 5.1 825,670 5.0 514 6.7 Atlanta 10,055, 640 9.7 247, 209 8.3 539, 923 3.3 376 4.8 Chicago . 14,154,175 13.7 190, 513 6.4 2,131,874 12.9 1,036 13.5 St. Louis 9,291,698 9.0 194, 767 6.5 633,725 3.8 466 6.1 Minneapolis.. 5,164,426 4.9 414,074 13.8 784, 745 4.7 747 9.7 Kansas City 7,404,443 7.1 473,611 15.8 1,161,353 7.0 949 12.7 Dallas .. 5,637, 290 5.4 394,161 13.6 601,160 3.7 622 8.1 San Francisco 6,631,164 6.4 683, 852 23.0 1,177, 578 7.1 534 7.0 Total .. 103,640,473 100.0 2,973,890 100.0 16,536,928 100.0 7,634 100.0 BANKING POWER OF DISTRICT. The total banking resources of the district reached a new record in 1917. The following figures include national banks (as of Sept. 11), State banks, and trust companies: Banking institutions—District No. 3. 1000's omitted.] Capital. Surplus. U vi n d d e i d - I u n a d l i v d i e d - - Bank Total profits . posits. deposits. resources. Pennsylvania: National banks (535) $68,877 $90,385 $25,053 $789,138 $163,938 $1,209,999 State institutions (301 reporting) 73,691 96,609 45,781 604,473 70,767 981,010 Total (836) 142,568 186,994 70,834 1,393,611 234,705 2,191,009 New Jersey: National banks (72) . . 6,242 7,035 3,017 82,649 1,525 109,515 State institutions (40) 5,336 5,038 2,007 56,197 959 71,563 Total (112) 11,578 12,073 6,024 138,846 2,484 181,078 Delaware: National banks (22) 1,589 1,617 696 13,269 812 19,297 State institutions (27) 3,687 3,933 1,962 44,100 874 56,091 Total (49) 5,276 5,550 2,658 57,369 1,686 75,338 Totals: National banks (629) .. 76,708 99,037 28,766 885,056 166,175 1,338,811 State institutions (368) 82,714 105,580 49,750 704,770 72,600 1,108,664 Total (997) 159,422 204,617 78,516 1,589,826 238,775 2,447,474 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

340 A1NTKTTAL REPORT OF THE FEDERAL RESERVE BOABD. COMBINED STATEMENT OF CONDITION OF MEMBER BANKS. A comparative statement of condition of member banks is given in the following; table: Date of comptroller's call. Sept. 12,1914.1 Sept. 2,1915. Sept. 12,1916. Sept. 11,1917 RESOURCES. Loans and discounts $518,774,000 $527,799,000 $597,371,000 $647,542,000 United States bonds 60,843,000 61,438,000 58,812,000 91,707,000 Other bonds, securities, ate. 156,673.000 198,582,000 244,462,000 283,356,000 All other resources 207,188,000 267,289,000 295,338,000 317,256,000 Total. 1,003,478,000 1,055,108,000 1,195,983,000 1,338,811,000 LIABILITIES. Capital stock 76,875,000 77,248,000 76,814,000 76,708,000 Surplus 98,761,000 98,150,000 . 97,304,000 99,037,000 Undivided profits 20,759,000 21,100,000 24,460,000 28,766,000 National-bank notes outstanding. 64,197,000 58,278,000 56,291,000 55,596,000 Individual deposits 570,342,000 640,860,000 759,894,000 877,549,000 Bank deposits 159,796,000 149,604,000 166,926,000 166,175,000 All other liabilities 12,748,000 9,868,000 14,294,000 34,980,000 Total. 1,003,478,000 1,055,108,000 1,195,983,000 1,338,811,000 1 The figures for 1914 include only those banks now in this district. RESERVE CONDITION OF MEMBER BANKS. The banks have maintained strong reserve positions as shown by the following table. On September 12, 1914, two months prior to the inauguration of the new banking system, the banks held excess reserves of only $22,000,000 above the then required reserve of $175,- 000,000. When the Federal Reserve Act went into operation, $50,- 000,000 of reserves were released. Reserve condition of member national banks. [000's omitted.] With Federal With approved In vault. Reserve Bank. reserve agents. Total. Date of corap- j Excess. trailer's call. I Re- Re- Re- Re- I Held. quired. Held. quired. Held. quired. Held. quired. 1914. Dec. 31 $59, 727 $39,612 $18,512 $17,467 j $81,328 $39,612 $159,567 $96,691 $62,876 1915. Mar. 4 59,946 41,731 20,603 18,507 101,359 41,731 181,908 101,970 79,939 May 1 54,066 42,349 20,459 18,818 106,072 42,349 180,598 103,516 77,082 June 23 .-.! 60;453 43,189 21,248 19, 236 111,402 43,189 193,104 105,613 87,497 Sept. 2 48,299 36,516 19,443 16,625 98,752 36,516 166,493 89,657 76,836 Nov. 10 50,420 38,428 20.238 17, 550 94,407 38,428 165,065 94,406 70,659 Dec. 31 | 50,886 37,822 27i 267 24,092 75,215 30,957 153,368 92,872 60,496 1916. Mar. 7 55, 568 40,663 28,899 25,954 93,868 33,309 178,835 99,926 78,409 May 1 51,157 40,898 26,712 26,106 87,232 33,501 165,101 100, 505 64,596 June 30 46,863 40,324 34,108 33,013 73,487 25, 704 154,458 99,041 55,417 Sept. 12 55,485 42,591 41,294 34,856 80,821 27,120 177,600 104, 567 73,033 Nov. 17 51,633 44,308 47,443 44,308 78,036 20,222 177,112 108,838 68,274 Dec. 27 53,492 44,038 62,114 44,038 66,690 20,032 182,296 108,108 74,188 1917 Mar. 5 54,418 46,224 59,877 46,224 85,007 21,067 199,302 113,515 85, 787 Mayl 52,661 46,579 63,578 46.579 77,645 21,234 193,884 114,392 79,492 June 20..... 50,663 44, 580 64,553 44.580 64,996 20,238 180, 212 109,398 70,814 Sept. 11... 68,347 70,310 68,347 70,310 1,963 Nov. 20.... 74,277 74,277 68,066 6,221 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 3 PHILADELPHIA. 341 DEPOSITS, LOANS, AND BORROWINGS OF MEMBER BANKS. Borrowings by member banks are shown in the following table.: The average ratio between loans and deposits for the past three years has been 79.3 per cent. The banks in the district are generally not heavy borrowers, but they have become accustomed to relying on the Federal Reserve Bank for assistance. On December 31, 1915, of the total borrowings from all sources by banks in the district, only 5.5 per cent was from this institution. On November 20, 1917, this figure was 78.4 per cent. Member hanks—District No. 3. Borrow- Borrowings ings from Per cent Date. Deposits. L di o s a c n o s u a n n ts d . Rate. R F f e e r d s o e e m r r v a e l ot F s h o e e u d r r e c t r h e a s a l n bor T ro o w ta i l ngs. b F o f e r r r d o o o m w ra e ! d Bank. Reserve Reserve Bank. Bank. 1914. Perct. Per cent. Dec. 31 $757,895,000 $629,971,000 83.0 $786,000 $6,678,000 $7,464,000 10.5 1915. Mar. 4 766,350,000 630,516,000 82.3 608,000 3,245,000 3,853,000 18.0 Mav 1 774,550,000 642,200,000 82.9 627,000 4,654,000 5,281,000 11.9 June 23 794,940,000 638,372,000 80.3 599,000 4,773,000 5,372,000 11.1 Sept. 2 640,859,000 527,798,000 82.3 646,000 2,880,000 3,526,000 18.3 Nov. 10 670,195,000 553,856,000 82.5 127,000 2,049,000 2,176,000 5.3 Dec. 31 680,957,000 553,338,000 81.2 168,000 2,887,000 3,055,000 5.5 1016. Max. 7 705,576,000 567,036,000 80.4 189,000 2,041,000 2,230,000 8.5 Mayl...... 728,385,000 587,185,000 80.6 502,000 2,380,000 2,882,000 17.4 June 30 723,071,000 590,604,000 81.6 530,000 2,108,000 2,638,000 20.1 Sept. 12 759,894,000 597,371,000 78.6 263,000 2,323,000 2,586,000 10.1 Nov. 17 800,209,000 621,491,000 77.7 563,000 4,151,000 4,714,000 11.9 Dec. 27 803,279,000 612,720,000 76.2 1,563,000 8,538,000 10,101,000 15.5 1917. Mar. 5 819,658,000 626,192,000 76.4 1,080,000 5,132,000 6,212,000 17.7 Mayl 856,440,000 637,270,000 73.7 1,261,000 5,843,000 7,104,000 17.7 June 20 834,139,000 727,275,000 75.2 17,108,000 9,738,000 28,846,000 63.6 Sept. 11.... 877,549,000 647,542,000 73.8 14,080,000 6,771,000 20,851,000 67.5 Nov. 20 1,137,208,000 664,215,000 58.5 23,101,000 6,427,000 29,528,000 78.4 RELATION OF LOANS AND DEPOSITS OF PHILADELPHIA CLEARING-HOUSE MEMBERS. The following figures, concerning members of the Philadelphia Clearing House Association, are given as a matter of interest, as the Philadelphia member banks contribute 42 per cent of the capital of the Federal Reserve Bank and carry balances with it amounting to 56 per cent of the total member bank deposits with the Federal Reserve Bank. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

342 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. Philadelphia clearing-house members, 1917. [000's omitted.] Loans, Deposits. dis- Ratio Capital. counts, of loans stock. i m n a v e n n e d s ts t- . Bank. v I i n d d u i a - l. Total. p to o s d it e s - . January... $30,370 $532,200 $178,360 $478,480 $656,840 81.0 February. 30,370 545,740 185,050 482,790 667,841 81.8 March 30,370 550,740 188,240 474,620 662,860 83.1 April 30,370 552,330 187,020 490,130 677,150 81.5 May 30,470 561,230 171,670 486,140 657,810 85.3 June 30,470 552,810 169,310 470,230 639,540 86.5 July 31,470 554,910 164,680 469,600 634,280 87.5 August 31,470 550,890 163,180 466,260 629,440 87.6 September 31,470 561,790 164,720 476,310 641,030 87.5 October... 31,470 573,160 174,340 495,050 669,390 85.6 November, 31,470 600,980 173,720 492,400 666,120 90.2 December. 31,470 592,550 169,110 472,070 641,180 92.5 ACCEPTANCES UP TO 100 PER CENT. The following banks, all located in Philadelphia, have been given authority to accept up to 100 per cent of their capital and surplus, as provided by the Federal Eeserve Act: Fourth Street National Bank, Girard National Bank, Philadelphia National Bank, Tradesmen's National Bank, Market Street National Bank. There was approved on June 7, 1917, an act of the State legislature empowering State banks and trust companies to accept drafts and issue letters of credit, and it is expected that the acceptance business of the banks in the district will become an increasing item. Acceptance liabilities of member banks. Amount. Date of comptroller's call— Dec. 31, 1915 $2, 809, 000 Mar. 7, 1916 5, 751, 000 May 1, 1916 6, 219, 000 June 30, 1916 5, 234, 000 Sept. 12, 1916 5, 084, 000 Nov. 17, 1916 8,640,000 Dec. 27, 1916 8, 309, 000 Mar. 5, 1917 8, 852, 000 May 1, 1917 6,154, 000 June 20, 1917 8, 513, 000 Sept. 11, 1917 9, .732,000 Nov. 20, 1917 7, 522,000 BANKS GRANTED FIDUCIARY POWERS. This bank has received many applications from members for permission to act as trustee, executor, etc. There is a conflict of opinion Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 3—PHILADELPHIA. 343 as to whether or not national banks in the States comprising this district can legally act in fiduciary capacities without enabling legislation, and we do not know which of the following institutions, whose applications have been approved, have actually undertaken to act in a fiduciary capacity. Banks of the district which have J)cen granted special powers. Location. Name of bank. Powers granted. Delaware: Frederica First National Bank Trustee, executor, administrator, and registrar of stocks and bonds. Pea ford do Do Laurel Peoples National Bank Do. New Jersey: Atlantic City.. Atlantic City National Bank Do. Do Union National Bank Trustee, executor, and administrator. Cape May Merchants National Bank Registrar of stocks and bonds. Princeton First National Bank Trustee, executor, administrator, and registrar of stocks and bonds. Trenton do Do Do Broad Street National Bank Do. Pennsylvania: Annville Annville National Bank Do. Belleville Belleville National Bank Trustee, executor, and administrator. Blossburg Miners National Bank Trustee, executor.administrator, and registrar of stocks and bonds. Dubois Deposit National Bank Do. Do DuBois National Bank Do. Ephrata Farmers National Bank Trustee, executor, and administrator. Harrisburg Merchants National Bank T t r r u a s r te o e f , s e t x oc e k cu s t s o .p r, f i a d bo m n i d n 5 i ? strator, and regis- Hazleton Hazleton National Bank Do. Huntingdon.. . First National Bank Do. Jenkintown Jenkintown National Bank Trustee, executor, administrator. Johnstown First National Bank Trustee, executor, administrator, and registrar of stocks and bonds. Lansdale ..do Do Lititz Farmers National Bank Do. Marietta Exchange National Bank Do. Maytown Maytown National Bank Do. Mountville Mountville National Bank Do. Myerstown Myerstown National Bank Do. Nanticoke First National Bank Do. Nazareth Nazareth National Bank Do. Newville First National Bank Do. Patton do Do. Pen Argyl .. do Do Philadelphia... Fourth Street National Bank Registrar of stocks and bonds. Do Eighth National Bank Trustee, executor, administrator, and registrar of stocks and bonds. Do Philadelphia National Bank Registrar of stocks and bonds. Do Quaker City National Bank Do. Do Southwark National Bank Trustee, executor, administrator, and registrar of stocks and bonds. Reading Penn National Bank Do. Scranton Third National Bank Registrar of stocks and bonds. Stroudsburg First National Bank Trustee, executor, administrator, and registrar of stocks and bonds. Tioga Grange National Bank Do. Topton National Bank of Topton Trustee, executor, and administrator. West Chester.. National Bank of Chester County Trustee, executor, administrator, and registrar of stocks and bonds. West Grove National Bank of West Grove Do. Wilkes-Barre... Second National Bank Do. Williamsport... West Branch National Bark Do. York Industrial National Bank of West York. Do. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

344 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. IX. STATE BANK MEMBERSHIP. The Legislature of Pennsylvania passed an act, approved July " 17, 1917, authorizing any bank or trust company incorporated under the laws of the State to become a member of a Federal Reserve Bank, and in such event to be subject to all the provisions of the act of Congress known as the Federal Reserve Act, allowing any such bank or trust company to comply with the reserve requirements of such act in lieu of those established by the laws of the State, and permitting the commissioner of banking to accept the examinations and audits made pursuant to such act in lieu of those required by the laws of the State, The movement of State banking institutions into the Federal Reserve system began in August when the directors of the Miners' Deposit Bank of Lykens, Pa., resolved to apply for admission. On October 16 the Girard Trust Co. of Philadelphia filed its application, which was approved by the Federal Reserve Board on November 5, and on that date the company become a member. Since then the following trust companies have been admitted: Philadelphia Trust Co., Philadelphia; Commercial Trust Co., Philadelphia; Pennsylvania Co,, Philadelphia; Camden Safe Deposit & Trust Co., Camden, N. J.; Wilmington Trust Co., Wilmington, Del. This makes the number of State member banks 7. The banking institutions that have been admitted have resources of $168,683,000. They have added $831,300 to the capital of this bank and $12,576,000 to its deposits. There are 285 banks and trust companies eligible for membership. Signs of interest in the matter of membership have been manifested throughout the district, and we believe it will not be very long before most of the State institutions have made application for admission. Membership in the Federal Reserve system is looked upon as evidence of the strength of a banking institution, and ultimately we have every confidence that all institutions will be member banks. As shown by the reports of the loan and transit operations there has been a marked increase in the use of the facilities of the Federal Reserve Bank by the member banks, and we hear on all sides expressions of deepest satisfaction with the system. The Liberty loan transactions brought the bank into direct contact wTith all the State institutions of the district and have done much to establish cordial relations with them. X. FISCAL AGENCY OF THE UNITED STATES. The most important function performed by the bank during the year was its part in the placing of the Liberty loans and United States certificates of indebtedness. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 3—PHILADELPHIA. 345 Promptly following the receipt on May 3 of word from the Secretary of the Treasury that he had decided to use the Federal Reserve Banks as the central agencies in their districts in organizing the campaign for placing the bonds and certificates of indebtedness, receiving subscriptions, handling payments, delivering bonds, etc., and that he had communicated with all banks in the United States asking them to cooperate with the Federal Reserve Banks, a conference was held with the representatives of all the banking interests and the owners or managers of the newspapers of Philadelphia to consider plans for conducting the work. As a result of this conference, the governor of the Federal Reserve Bank was asked to appoint a general committee to have charge of the campaign, which committee was duly organized. Other committees were formed to conduct particular branches of the work. Committees of bankers and those connected with other lines of business were organized in nearly every local community, and the work of placing the bonds was undertaken with the utmost vigor. Depositors of banks were communicated with—the ptiblic interest was developed and stimulated through addresses at public meetings, at the theaters and other places of amusement, at meetings of employees in shops and stores. Scholars and teachers in the schools were organized for the work, newspaper advertising and posters were freely used. Facilities were furnished by the banks which made it possible to meet subscriptions by weekly payments, for the safe keeping of the bonds without charge, and for making loans on bonds at the same rate of interest as that borne by the bonds. In both campaigns practically the same organization was used, it being, however, more developed and enlarged and made more comj)rehensive for the second campaign. The conduct of the campaigns was actively supervised by committees, upon the chairmen of which fell the greater burden of the work. These men and their associates on these committees were untiring in their work, all their time was placed at the disposal of the committees, and in the successful conducting of the campaigns they rendered services which could not have been bought and which were of inestimable value to their country. Especial acknowledgment should be made of the services of the investment bankers, who practically suspended their private business to undertake the sale of the Liberty loans. They placed at the service of the committee a large and efficient force of bond salesmen whose training and experience did much toward the success of the campaign. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

346 AisnsruAL REPORT OF THE FEDERAL RESERVE BOARD. The report of the Liberty loan campaign committee gives the names of over 4,000 persons serving as chairmen of the various general and local committees, cooperating with whom were more than 25,000 people. It is a matter of deep regret that there is not sufficient space in this report to permit the publication of all their names. Many banking institutions throughout the district availed themselves of the opportunity to become depositaries of the proceeds of Liberty bonds, 32 banks, 82 trust companies, and 200 national banks being appointed such depositaries. To pass upon and care for the securities for these deposits, securities committees composed of three bank officers were appointed in 15 cities and banking institutions were appointed as custodians of securities. In Philadelphia committees of bank officers nominated by the Philadelphia Clearing House Association acted as the securities committees and custodians of securities. The securities sent to the Philadelphia custodians were deposited with the clearing house. Securities to the value of nearly $200,000,000 were handled by these committees and custodians. This service was all voluntary, without compensation, and involved a considerable sacrifice of time, but it was of inestimable value in facilitating the settlements for Liberty loan bonds. The amount of Liberty bonds subscribed for and allotted in this district and the number of subscribers were as follows: Amount sub- Amount allotted. Number of scribed. subscribers. "First Liberty loan... $232,309,250 $165,147,600 476,000 Second Liberty loan. 380,350,250 280,184,100 623,000 Of the second Liberty loan $8,167,600 was subscribed for by the scholars and teachers of the public and parochial schools of Philadelphia. The allotments of issues of Treasury certificates of indebtedness to this bank were practically all taken by the banking institutions of the district. At the close of subscription, the bank sometimes had left a moderate amount of certificates, but in all but one instance they were finally absorbed by belated subscriptions. The subscriptions for the certificates made through this bank were as follows: Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTBICT NO. 3 PHILADELPHIA. 347 United States certificates of indebtedness. Number Total of sub- amounts Amount allotted to subscribers. scribers allotted to in each each group. group. Issued Apr. 25, due June 30; 3 per $25,000 and less $530.000 cent. Over $25,000 to $50,000 760,000 Over $50,000 to $100,000 1,250,000 Over $100,000 to $250,000... 1, 760,000 Over $250,000 to $500,000... 2,700.000 Over $500,000 to $1,000,000., 5,000, 000 130 12,000,000 Issued Apr. 27, due June 30; 3 per$25,000 and less , 345, 000 cent. Over $25,000 to $50,000 305.000 Over $50,000 to $100,000 250,000 Over $100,000 to $250,000... 100,000 Over $250,000 to $500,000... Over $500,000 to $1,000,000. 55 1, 000, 000 Issued May 4, due June 30; 3 per$25,000 and less 195,000 cent. Over $25,000 to $50,000 105.000 Over $50,000 to $100,000 100,000 Over $100,000 to $250,000... 600,000 Over $250,000 to $500,000... Over $500,000 to $1,000,000. 35 1,000,000 Issued May 10, due July 17; 3i per $25,000 and less 682,000 cent. Over $25,000 to $50,000 825,000 Over $50,000 to $100,000 1,491,000 Over $100,000 to $250,000... 1,452,000 Over $250,000 to $500,000... 2,050,000 Over $500,000 to $1,000,000. 3,500,000 184 10,000,000 Issued May 25, due July 30; 3 J per $25,000 and less 125 888,000 cent. Over $25,000 to $50,000 24 610, 000 Over $50,000 to $100,000 29 1,486,000 Over $100,000 to $250,000... 19 2,595, 000 Over $250,000 to $500,000... 7 1,921,000 Over $500,000 to $1,000,000. 3 1,500,000 207 9,000,000 Issued June 8, due July 30; 3J per $25,000 and less 767,000 cent. Over $25,000 to $50,000 939,000 Over $50,000 to $100,000 1,492,000 Over $100,000 to $250,000... 2,315,000 Over $250,000 to $500,000... 2,741,000 Over $500,000 to $1,000,000. 2,146,000 185 10,400,000 Issued Aug. 9, due Nov. 15; 3! $25,000 and less 687,000 per cent. Over $25,000 to $50,000 735,000 Over $50,000 to $100,000 1,330,000 Over $100,000 to $250,000.... 3,993,030 Over $250,000 to $500,000.... 2,155,000 Over $500,000 to $1,000,000.. 3,900,030 181 12,800,000 Issued Aug. 28, due Nov. 3G; 3| $25,000 and less 703,000 per cent. Over $25,000 to $50,000 975,000 Over $50,000 to $100,000 1,970,000 Over $100,000 to $250,000..., 1,777,000 Over $250,000 to $500,000..., 2,655,000 Over 1500,000 to $1,000,000., 1,802,000 9,882,000 34365°—18 23* Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

348 ANNUAL REPORT OF THE FEDEEAL RESERVE BOARD. United States certificates of indebtedness—Continued. Number Total of sub- amounts Amount allotted to subscribers. scribers allotted to in each each group. group. Issued Sept. 17, due Dee. 15; 3£ $25,000 and less 71 $600,000 per cent. Over $25,000 to $50,000 22 555,000 Over $50,000 to $100,000 20 1,012,000 Over $100,000 to $250,000 10 1,350,000 Over $250,000 to $500,000 6 1,700,000 Over $500,000 to $1,000,000 5 3,000,000 134 8,217,000 Subscribed to by Federal Reserve Bank 633,000 134 8,850,000 Issued Sept. 26, due Dec. 15; 4 per $25,000 and less 129 1,189,000 cent. Over $25,000 to $50,000 50 1,271,000 Over $50,000 to $100,000 29 1,554,000 Over $100,000 to $250,000 30 3,841,000 Over $250,000 to $500,000 6 1,850,000 Over $500,000 to $1,000,000 11 10,295,000 255 20,000,000 Issued Oct. 18, due Nov. 22; 4 per $25,000 and less 181 1,806,000 cent. Over $25,000 to $50,000 75 2,047,000 Over $50,000 to $100,000 45 2,355,000 Over $100,000 to $250,000 28 3,410, 000 Over $250,C00 to $500,000 6 1,550,000 Over $500,000 to $1,000,000 14 12,832,000 349 24,000,000 Issued Oct. 24, due Dec. 15; •* per $25,000 and less 31 361,000 cent. Over $25,000 to $50,000.. 21 628,000 Over $50,000 to $100,000 13 660,000 Over $100,000 to $250,000 11 1,310,000 Over $250,000 to $500,000 7 1,800,000 Over $500,000 to $1,000,000 8 8,841,000 91 13,600,000 Issued Nov. 30, due June 25,1918, 125,000 and less 24 216,000 4 per cent. Over $25,000 to $50,000 2 87,000 Over $50,000 to $100,000 8 420,000 Over $100,000 to $250,000 1,488,000 O O v v e e r r $ $ 5 2 0 5 0 0 , , 0 0 C 00 0 t t o o $ $ 5 1 0 ,0 0 0 ,0 0 0 ,0 0 00 • 8,8 4 8 0 1 0 , , 0 0 0 00 0 * 53 11,492,000 XI. RESUME OF BUSINESS CONDITIONS. January.—The year commenced with an excellent undertone to general business conditions. However, the possibility of peace resulting from the exchange of notes caused hesitation in all lines of business, and developed a spirit of caution on the part of buyers in contracting for goods in excess of immediate wants. Commercial failures during 1916 were fewer than the preceding year and the liabilities of the companies involved were less in amount. Of the concerns failing 94 per cent were conducting business with less than $5,000 capital. The year 1916 was one of comparatively low crop production, but the prices obtained for most of the crops were extraordinarily high. The value of the products of farms in the district shows a gain of about 44 per cent for 1916 over 1915. Rates for money were easier than the preceding month. Call money de- Digitized forc FliRnAeSdE Rfr om 5 per cent to 3i per cent. http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT IsT0. 3 PHILADELPHIA. 349 February.—The difficulties of the railroads and steamship companies in moving goods promptly, the scarcity and inefficiency of labor, and the increased cost and inadequate supply of coal and other materials curtailed production somewhat. Activity continued in practically all industrial and other lines of business, and no difficulty was experienced in disposing of products. In some localities there was much conservatism in the placing of new orders. Quite a number of important industrial concerns enlarged their plants. Collections were generally satisfactory. There was a general feeling of confidence and optimism as to the future, but on account of the extraordinary conditions and the uncertainty of the foreign situation, business was conducted in a cautious and conservative way. Locomotive business was reported as unprecedentedly favorable. Money rates remained easy. The announcement of Germany's new submarine policy resulted in violent declines in the prices of securities. March.—While less active than the preceding months, the volume of business transacted in most lines continued on a large scale. Stimulated by the United States Government's inquiries and orders, prices of many articles were further advanced. Because of the uncertain foreign situation, however, commitments were undertaken with caution. In response to a questionaire to which 362 business concerns replied, 67 per cent reported business " excellent or good," 13 per cent " fair," and 20 per cent " uncertain or bad." Two hundred and thirty-seven concerns reported the outlook to be "excellent or good," and 118 " fair, uncertain, or bad." An average increase during the past year of 26 per cent in wages and 49 per cent in cost of materials was reported. Money rates were easy. April.—The entrance of the United States into the war caused advances in prices, greater demand for goods, and greater scarcity in materials in many lines of trade. Manufacturing plants throughout the district were running as fully as the supply of labor and materials would permit. The problem of deliveries in many cases was very annoying because of the limitation of output and troublesome transportation conditions. The labor situation became very acute. The condition of the winter wheat crop was reported 15 per cent below normal. There arose a patriotic desire on the part of the people in agricultural sections to do their full duty toward producing the maximum amount of foodstuffs, but on account of the high prices and scarcity of fertilizer, the high price of seed, and the scarcity and high wages of labor, it appeared that the acreage planted in food crops could not be increased materially. The attempt was made to have people put forth extra efforts in planting vegetable gardens for their own account. Retail trade during March was reported as the largest in history, but after Easter trade fell off very Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

350 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. much. It was felt that this was largely due to the practicing of economy on the part of the public which was so earnestly recommended. The prospect of large Government borrowings caused hesitation in the investment of funds. Sales of securities fell off and prices declined. May.—Manufacturing plants operated as near capacity as possible. A slowing up became noticeable, however, in retail trade and among the jobbers of wearing apparel of all kinds, due to extremely high prices, unseasonable weather, the economy campaign, and the fact that most consumers were pretty well supplied. Some of the department stores were compelled to reduce their staffs of employees because of curtailed sales. The potato acreage in Pennsylvania was estimated at 108 per cent in comparison with last year. Manufacturers of goods not essential to war, such as carpets, lace curtains, and tapestries, did not have enough orders to warrant more than 50 per cent operation. Surplus reserves of the Philadelphia banks decreased $20,000,000. Money rates stiffened considerably, call money advancing from 3| to 4 per cent. The prevailing rate for paper was 5 per cent. June.—There was a noticeable improvement in business conditions in those lines which are especially dependent upon weather conditions, higher temperatures having stimulated demand for many summer specialities and business in seasonable merchandise wTas well up to normal in volume. The Philadelphia department stores reported considerable improvement and expected business to continue good. The automobile pleasure car business was reported as not very good. Cotton and wool prices were very high. A further decrease in the surplus reserves of the Philadelphia banks to the lowest point since December, 1916, forced up call money to 5 per cent. Commercial paper ruled at 5J per cent. The rediscount feature of the Federal Reserve Bank was availed of to a very considerable extent. Financial institutions were occupied with the flotation of the Liberty Loan. July.—There was no change, generally speaking, in the great business activity prevailing in this section. In nearly every line, the manufacturer, jobber and retailer report the volume of business large and results satisfactory, although there was no cessation of complaints of the difficulty in obtaining workers, the scarcity of fuel, and unsatisfactory transportation conditions. Uncertainty due to possible legislation as to price control adversely affected some lines. Bates for money continued firm, call money and paper being quoted at 5 per cent. Due to the high cost of materials and high wages, very much more money was required to conduct business than formerly, and customers borrowed freely from their banks and lines of credit were used to the full. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 3—PHILADELPHIA. 351 August.—There was no important development in the business situation. A strong tendency toward cautiousness existed on the part of buyers, owing to the uncertainty of future prices and the high cost and scarcity of many kinds of goods. There wTas a steady readjustment to war conditions, but business men generally expected an active fall and winter business. Great difficulty was reported in all lines in securing sufficient skilled and unskilled labor and office help, which, in some cases, forced production below normal. The high cost of building materials and labor resulted in the cessation of building for investment. Manufacturing druggists and chemists were taxed to the limit taking care of emergency orders required by the European countries, the United States Government and the Eed Cross. Member banks continued to avail themselves quite freely of the rediscount feature of the Federal Reserve Bank. Financial institutions were well loaned up, and the money market remained on a firm 5 per cent business. There was a good commercial demand for funds. Public interest in the security markets was at a low ebb. September.—Plants throughout the district continued busy and manufacturers generally expected a very large volume of business owing to the tremendous quantities of business needed by the Government for carrying on the war. Retail distribution of fall merchandise showed a very satisfactory increase in activity, demand being stimulated by cool weather and the return of many people to the city, but there was some complaint that the high prices were restricting the movement in certain lines. Wholesale orders were placed in considerable amounts, especially for staples in dry goods, furnishings, notions, underwear, etc. All lines were prevented from working to capacity by the uncertain deliveries, scarcity of raw materials, and the shortage of labor. Money rates advanced, best names selling at 5^ per cent. October.—The outstanding feature of financial and business conditions was the concerted effort of practically all the financial institutions and a great many industrial concerns to make the second Liberty loan an unqualified success. General business conditions continued to be prosperous, and retail trade retained its activity. The predominating influence of the war was felt in nearly all lines of industry, and Government orders took precedence over private business. As a result, the normal demand was somewhat obscured, and a marked conservation in placing orders for deliveries next spring was noticeable. The scarcity of cars resulted in very unsatisfactory deliveries of coal. Government orders for coal produced a shortage in the supply available for the customary needs of domestic and commercial consumers. The production of iron and steel mills was seriously curtailed by the scarcity of fuel. The sugar shortage, caused by the fact that much of the Cuban crop was purchased by the Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

352 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. allied Governments., was reported to be purely temporary. Another cause of the scarcity was that consumers were buying far ahead of their needs, thereby reducing the already small supply in the hands of the dealers, but relief was in sight from the new Louisiana and Hawaiian crops, also western beet sugar. Bank clearings readied a high record figure—$1,678,000,000 for the district. Eates for commercial paper were firm at 5^ to 6 per cent. A continuation of liquidation of high-grade investment securities resulted in a further decline in prices. November.—Manufacturing industries were running at high pressure, but were somewhat restrained by the very considerable difficulties encountered in securing supplies and sufficient labor. The large ball-bearing plants in the district were seriously affected by the falling off in the production of automobiles, for which the largest part of the output of ball bearings was used. Cotton prices reached a level hitherto unattained for a long period of years. Retail trade conditions generally appeared to be stationary. Collections were good, except in the case of a few industries which were affected adversely by war conditions and the working out of the new Government policies. Building operations were curtailed owing to the high cost and difficulty in obtaining labor and materials and the difficulty experienced by builders in securing advances of money from financial institutions. Exports from the port of Philadelphia reached $62,724,000, a new record, the increase being largely due to heavy shipments of powder. Opinion throughout the district was unanimous in agreeing that the railroads should receive an advance in freight rates. Eates for paper continued firm at 5^ to 6 per cent. There was an average demand for loans in most quarters, but in some parts of the district borrowers used full lines of credit. December.—The industries engaged in producing supplies for war purposes were running at as near capacity as possible. Other industries, however, felt to a considerable extent the circumstances which tended to cut down their output; the demand for their product decreased, and they were unable to meet the wages which the munition factories offered. Christmas trade was rather disappointing and not up to normal. Many merchants did not cany as large stocks as was their custom in previous years, owing to their unwillingness to put in large stocks of goods at the prevailing high prices and because of their inability in many instances to secure goods from the manufacturers. The coal situation was considerably aggravated by the appearance of cold weather earlier than usual. Some manufacturing plants were forced to operate on a margin of not more than one or two days' supply of coal. Building operations practically ceased, except where absolutely necessary. The total of the Christmas sav- Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 3 PHILADELPHIA. 353 ings funds carried by the banks in the district amounted to upward of $10,000,000, which was about $500,000 ahead of 1916. The number, of depositors was approximately 350,000. Payments on account of Liberty loan subscriptions caused a shrinkage in loanable funds, and money rates were firm. The call-money rate was advanced to 6 pei? cent and the rate for paper to 5| per cent. BANK CLEARINGS. The growth of business in the district during the year is shown in the following table of bank clearings, which are the largest on. record. Of course the high prices of goods constituted a prominent cause for the big increase. Clearings in the Third District. District 1917. Philadelphia. outside of Total for district. Philadelphia. January 397,691,175 000,832 $1,494,692,007 February 251,517,407 83,891,961 335,409,368 March 467,016,516 97,276,863 564,293,379 April 410,313,000 101,560,000 511,873,000 May 477,700,000 99,545,000 577,245,000 June 503,806,000 99,932,000 603,738,000 July 331,836,519 99,272,488 431,109,007 August 368,485,000 92,576,000 461,061,000 September 337,772,768 91,846,400 429,619,168 October 569,400,000 109,360,000 678,760,000 November 532,682,000 99,532,000 632,214,000 December 549,512,824 102,350,996 651,863,820 Total for rear. 17,197,733,209 1,174,144,540 18,371,877,749 26 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

354 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. 1915-1917 BANK CL&ARIMGS COMPARED FOR PHILADELPHIA P&DERAL RE5ERV& DISTRICT JAN|FE5|MAR|APR|MAYJUNE[JULY|AUG!5EPT|0CT|N0YlDeC S 2,000,000,000 1,800,000,000 1\ 1,600,000,000 N / ***** 1 / 1,400,000,000 1 \ i i t i 1,200,000,000 t i i 16 ,— t t +'* / 1,000,000,000 f / / 800,000,000 s y / / y 600,000,000 400,000,000 • 200,000,000 Digitized for FRASER CHART NO. 12. http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 3 PHILADELPHIA. 355 COMMERCIAL FAILURES. The year 1917 showed a continued falling off in the number of commercial failures, and during the month of September there were only 40, the smallest number for any month we reported. Of these, 37 were concerns doing business with a capital of $5,000 or less. The following table has been compiled from Bradstreet's report of commercial failures in the district: Bradstrccfs report of commercial failures in the Third Federal Reserve District, classified as to capital employed. $5,000 and $5,000 to $20,000 to $50,000 to $100,000 to Total. less. $20,000. $50,000. $100,000. £500,000. 1917 1916 1917 1916 1917 1916 1917 1916 1917 1916 1917 1916 January 73 90 2 4 1 1 75 96 February 48 95 2 7 1 1 51 103 March 56 96 3 4 2 1 61 101 April 54 64 1 2 1 1 56 67 May 58 44 2 2 1 2 61 48 June 40 46 4 3 1 1 45 50 July 44 55 3 2 1 48 57 August 46 60 2 5 1 i 49 65 September. . 37 69 1 2 2 1 1 40 73 October 58 84 4 2 1 1 1 65 87 November 58 78 7 2 1 60 86 December 57 88 3 1 2 2 1 1 1 63 93 Total 629 869 27 39 9 2 4 2 5 674 926 IMPORTS AND EXPORTS. Exports from the port of Philadelphia during the year 1917 were the largest on record, and in October, a neAv high mark of $62,724,000 was reached, due chiefly to heavy shipments of powder. Besides munitions of war, other important items exported in large quantities were grain and petroleum. Naturally, in view of the foreign situation, imports declined in comparison with the previous year. Figures prepared by the Commissioners of Navigation follow: Business through the port of Philadelphia. Exports. Imports. 1917 1916 1916 January $43,634,046 $11,738,378 $9,093,450 $7,387,295 February... 57,652,322 9,801,012 9,041,989 9,176,185 March 38,879,748 15,567,739 7,488,047 9,625,334 April 39,889,979 34,688,268 11,103,862 11,336,364 May 42,507,832 24,830,464 11,424,218 12,854,821 June 41,284,111 24.286,752 14,304,452 13,552,856 July 21,451,383 27,890,704 8,953,507 10,740,537 August 57,381,188 37,013,839 9,247,078 8,221,037 September.. 24,093,366 44,377,332 8,276,928 6,806,542 October 62,724,000 25,217,112 4,486,000 7,602,789 November.. 32,309,000 41,467,209 4,106,000 6,946,608 December... 40,158,000 25,165,429 4,446,000 6,712,340 Total. 501,964,975 321,044,815 101,971,531 111,407,851 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

356 AXNUAL REPORT OF THE FEDERAL RESERVE BOARD. FREIGHT CAR MOVEMENT. We give below tables showing the loaded freight car movement on the Pennsylvania, Lehigh Valley, and Delaware, Lackawanna & Western Railroads during the months of 1917 compared with each month of the preceding year. Pennsylvania R. R. loaded freight car movements at Leiviston Junction. Bituminous Coke, Miscellaneous, Miscellaneous, coal, eastbound. eastbound. westbound. Total. eastbound. 1917 1916 1917 1916 1917 1916 1917 1916 1917 1916 January 41,132 54,046 5,563 4,812 33,820 36,211 21,047 20,382 101,562 115,451 February.. 35,216 43,711 4,290 5,242 31,024 33,113 18,733 19,565 89,263 101,631 March 45,843 50,548 5,751 6,277 38,833 38,211 24,629 23,040 115,056 118,076 April 41.192 44,691 5,552 4,999 39,103 43,258 24,375 24,274 110,222 117,222 May 45, 785 41,527 5/643 5,022 38, 085 39,304 26,201 23,648 115,714 109,501 June 42,824 39,885 6,034 4,701 34,382 32,922 26,257 25,620 109,497 103,128 July. 41,367 42,184 6,366 4,608 33,057 32,113 25,479 28,170 106,269 107,075 August . 40,442 47,027 5,796 4,593 30,618 35,059 24,775 28,452 101,631 115,131 September. 38,215 42,752 5,596 4,668 31,766 35,537 22,821 28,318 98,398 111,275 October 38,009 43,051 5,503 5,216 30,211 37,141 20,834 27,019 94,557 112,427 November. 40,031 40,088 5,404 5,433 26,917 37,629 17,641 23,857 89,993 107,007 December.. 32.193 38,184 4,449 5,088 19,300 31,670 9,958 20,829 65,900 95, 771 Total 482,249 527,694 65,947 60,659 387,116 432,168 262,750 293.174 1,198,062 1,313,695 Lehigh Valley R. R. loaded freight car movements. 1917 1916 1917 1916 January.. 289,219 297,819 August 318,009 335,263 February 244,925 266,846 September. 327,812 324.700 March 324,971 325,845 October— 344,041 363,008 April 316,078 317,627 November. 336, 766 340,832 May 382,768 345,947 December. 248,001 300,992 June 35G,960 313,584 July 334,832 321,923 Total 3,824,382 3,854,38G Delaware, Lackavjanna & Western R. R. freight car mileage made on rails in the State of Neiv Jersey. 1917 1916 1916 January.... 2,694,942 2,894,378 August 2,539,253 2,660,504 February... 2241,833 2',529,818 September.. 2,391,001 2,883,8G4 March 2,964,152 2,798,402 October 2,685,839 2,883,864 April 2,779,917 2,704,331 November.. 2,498; 603 2,805,530 May 3190,253 2,713,220 December.. 2,281,811 2,607,211 June 3,069,278 2,651,817 July 2,626,794 2,684,534 Total. .|31,971,678 32,817,533 STOCK-EXCHANGE TRANSACTIONS. The decline in prices of securities, which reached their high point in November 1916, together with the Government war issues, and the consequent desire of investors to have their money in liquid form, in order to purchase Government obligations, resulted in a marked Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 3 PHILADELPHIA. 857 contraction in transactions on the Philadelphia Stock Exchange. There was little public interest in the market throughout the year. In the month of November, 1916, 1,035,085 shares were traded in, whereas in November of 1917, the number was only 284,170. The bond business, however, was reasonably satisfactory. Transactions on the Philadelphia Stock Exchange are shown in the following table: Philadelphia Stock Exchange transactions. Number of shares. Cost of bonds. 1917 1916 1917 1916 January 404,319 388,194 $2,396,150 $2,528,130 February 357,474 632,619 2,007,700 1,932,970 March 382,839 293,431 1,536,635 1,865,300 April ... . 278,141 235,001 2,065,464 1,541,600 May ... 369,140 294,750 1,185,400 1,572,550 June 187,464 281,670 796,350 1,498,395 July . 393,542 169,023 1,657,250 1,155,450 Au^u^t 219,187 230,882 1,269,970 1,402,150 September ... 256,558 559,062 2,054,850 1,180,776 October 327,698 508,992 2,507,100 1,723,900 November 284,170 1,035,085 987,300 1,779,110 December 260,156 753,417 1,249,250 1,323,130 Total 3,820,688 5,382,156 19,713,419 19,503,461 BUILDING OPERATIONS. Building operations decreased considerably from the mark reached in 1916. The high cost of labor and materials and inability of builders to secure advances from financial institutions are given as the reasons. Figures of building operations in Philadelphia given below are indicative of general building conditions throughout the district. The bulk of the depreciation was due to the falling off in the construction of twro-story houses, which amounted to $11,438,355. Building operations in Philadelphia. Number of operations. Estimated cost. 1917 1916 1917 1916 J anuary „ 613 736 $2,144,630 $1,859,090 February 815 1,086 4,042,115 2,437,750 March... 1,147 1,606 3,470,625 4,590,630 April. 1,337 1,915 5,009,740 6,227,780 Mav.. . . . 971 1,524 3 558 355 4 791 255 June 763 1,709 2,328,755 5,147,115 July. 592 1,040 5,195,365 3,101,685 August.. „ 666 1,247 1,554.115 4,472,120 September 578 1,153 2,252,765 3,301,310 October .. . . . .. 748 1,337 2 030 475 4 055 045 November 461 1,181 1,629,425 4,451,925 December 270 1,079 740,020 5,460,865 Total 8,961 15,613 33,956,385 49,896,520 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

358 ANNUAL REPOKT OF THE FEDERAL EESEEVE BOARD. POSTAL BUSINESS. Monthly postal receipts at the Philadelphia post office exceeded $1,000,000 for the first time in the month of November, when the figures reached $1,077,115. The increase shown is due, of course, to a large extent, to the higher postage rates which became effective about that time. Comparative statement of the postal and money-order "business of the Philadelphia post office. Postal business. Money-order business. 1917 1916 1917 1916 January . $887,803 $795,730 $2,101,685 $1,764,669 February 763,553 768,419 1,940,608 1,773,654 March.... 911,439 848,540 2,393,709 2-005. 4JV7 April... . 845, 997 780,454 2,049,152 L, 840, 750 May . .. 843,591 816,427 2,082, 896 :t, 868,081 June 785, 701 753,425 2,115,971 ]L, 859,586 703,971 659,289 2,062,602 1,759,991 August 734,499 693,636 2,206,179 1,864,638 September 817,806 750,615 2,225,889 :1,832,810 October. 973,469 830,311 2,507,410 L, 970,602 November . . . . .. 1,077,115 826,095 2,401,672 L. 985.087 December 1,160,298 968,010 2,636,275 2,287,716 Total. . 10,505,242 9,490, 951 26,724,048 22,813,041 CROPS, COLD STORAGE HOLDINGS, TOBACCO. The farmers in the district harvested good crops, which were in excellent condition for the most part. Farmers were, however, harrassed by inability to secure farm labor, and in many instances were forced to aid each other. Some crops had to be sacrificed, as the farmers were unable to harvest them. The new wheat crop appears to have a good start, but the acreage planted is about the same as last year. Cold storage plants in the district reported an increase of 29 per cent in the holdings of eggs compared with the previous year, 19 per cent in butter, and 53 per cent in cheese. Holdings of meat, however, declined from 10 to 15 per cent on the average. The tobacco fields of Pennsylvania are estimated to have produced over 58,000,000 pounds of tobacco during 1917, according to the Department of Agriculture. This is an increase of approximately 9,000,- 000 pounds over the 1916 crop. Prices paid averaged as high as 25 to 30 cents a pound. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 4—CLEVELAND. D. C. WILLS, Chairman and Federal Reserve Agent. It lias been frequently urged that the primary function of the Federal Reserve Bank is that of service—first, in mobilizing reserves; second, in rediseounting; and third, in providing an elastic currency; and that it did not greatly matter whether or not the Federal Reserve Banks might be money-making institutions. With vastly increased opportunities for service during the past year, however, the Federal Reserve Banks have demonstrated their capacity to earn a very comfortable margin over their expenses. The Federal Reserve Bank of Cleveland has made net earnings during the year sufficient to pay its entire arrearage of accrued dividends; but as a matter of banking prudence, it has been deemed wise to provide an ample reserve against depreciation, and accumulated dividends have therefore been paid to July 1, 1917. All furniture and equipment have been charged off the books. The expenses at the same time have naturally increased markedly with the rapidly expanding activities. Chart No. 1, appended hereto, shows graphically the gross earnings, both in total and divided into the three chief classes of revenue, together with the expenses and net earnings, and Exhibit A gives the data in tabular form. Chart No. 2 shows the relation of revenue-producing assets to capital stock. Exhibit B contains the daily average of invested funds, and the average rate of earnings on each class of investments, for each month of the year, compared with each month of 1916, and summary of investment operations is also shown in this exhibit. Exhibit C is a comparative balance sheet as at the close of business December 30, 1916, and December 31, 1917. Exhibit D is the comparative profit and loss account for the years 1916 and 1917. The extraordinary history of the United States during the year has tended toward a uniformity of experience in business and banking conditions throughout the country. District No. 4 is very largely a manufacturing district, and its record for the year as such is quite similar to that of the other industrial districts. It is the leading dis- 359 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

360 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. trict in the production of primary iron and steel products, and its industries of this character have of course been taxed to capacity throughout most of the year, together with industries in most other lines, although there has been some slight recession from the peak after the completion of contracts for munitions, etc., from foreign Governments, and pending the placing of orders for our own Government. This district also ranks high in agricultural products; and although the planting season was late and cold, the crops have been large and profitable. Building industries have been checked somewhat by the high cost of materials and labor. Transportation difficulties have been very great, and in many lines have severely retarded production as well as distribution. The district, although containing a very large part of the bituminous coal supply of the country, has suffered a severe coal shortage during the last part of the year, owing in part to transportation difficulties, in part to the situation which arose from the fixing of coal prices, and in part to the necessities of the Northwest for coal, resulting in the priority order for Lake shipments; in some cases, industries have been obliged to close down for short periods because of lack of fuel. In spite of the untoward conditions above referred to, however, •the general prosperity has been great, and the record of the district in Liberty loan subscriptions is evidence not only of the patriotism and thrift of our people, but also of surplus wealth produced. Between the first and second Liberty loans, the deposits in the banks of the district showed an actual increase of about 3 per cent. The growth of resources of member banks during the year is shown in Exhibit E. DISCOUNTS FOR MEMBER BANKS. The operations of the Federal Reserve Bank of Cleveland in rediscounts have immensely increased during the latter months of the year. This increase has been produced not only by the financing of Liberty loans, but by the demands of industry and commerce, which have required large amounts of working capital for financing current orders and operations, increased notably by high cost of materials and labor and consequent large inventories, and to some extent by the delays in production and deliveries incident to the difficulty of obtaining materials and the inadequate transportation facilities. Exihibit F shows the year's operations in rediscounts for member banks under the several classes of paper, and classified by maturities, with the same data for 1916. While the demand for money has increased and the money rates have tended to harden, no general advance in rates of rediscount at this bank was deemed advisable until December 1, when this bank in common with most of the other Federal Reserve Banks announced slight advances. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 4—CLEVELAND. . 361 Exhibit G shows the rates throughout the year for the various classes and maturities of paper. The growth in the use of trade acceptances has been marked during the latter part of the year. It was to have been expected that the usual reluctance to change would deter banks and business houses from the adoption of this new system until an active demand for money and credit and for the facilities of the Federal Reserve Banks should furnish a practical demonstration of the advantages of this kind of paper. From the inauguration of the Federal Reserve system, the best-informed men have felt that the adoption of the tradeacceptance system was only a matter of time, but that a considerable amount of time would be necessary before it should become the commoner method of closing accounts. It nowT seems that in less time than was anticipated, the system may come into very general operation. The Federal Reserve Bank of Cleveland has been active in the promotion of the adoption of the system at every opportunity, having been represented at a number of meetings of trade organizations for conferences on the subject, and having furnished information to a very large number of inquirers both by mail and in person. A large number of copies of the booklet, "Why Accept? " have been ordered through this bank during the year by business houses introducing the system among their trade. BANKERS' ACCEPTANCES. Transactions in bankers' acceptances have been large, although recently the bank has not been actively in the market for bankers' bills because of the needs of our member banks. District No. 4 being rather more self-contained than some of the other districts, however, there have been occasions when the demands of member banks in other districts were so much greater, proportionately, than in this district, that other Federal Reserve Banks have found it desirable to dispose of some of their investments in bankers' bills, and the Federal Reserve Bank of Cleveland has been glad to be of service to the general situation by making large purchases on these occasions—thus providing the intercommunication and leveling up between the reservoirs which was intended in the establishment of the system of 12 banks, but without the necessity of rediscounting for any other Federal Reserve Bank its member banks' paper. A number of the larger banks in district No. 4 have entered the acceptance field, discounting bills for both foreign and domestic trade during the year, and the Federal Reserve Bank of Cleveland has purchased the bills of its own member banks freely when offered. The following member banks have, upon application, been granted the right to accept up to 100 per cent of their capital and surplus Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

362 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. during the year: Fifth-Third National Bank, Cincinnati; Cleveland Trust Co.; First National Bank, Cleveland; Union National Bank, Cleveland; Union Trust Co., Pittsburgh. Exhibit H shows the transactions in bankers' acceptances during the year as compared with 1916. UNITED STATES BONDS. Transactions in the older issues of Government securities have of course been practically suspended since the offering of the first Liberty loan. Purchases of small amounts of bonds from member banks have been made as a matter of accommodation. Exhibit I shows the transactions in Government securities. MUNICIPAL WARRANTS. As soon as war was declared and it became apparent that the facilities of the Federal Reserve Banks would probably be needed by their member banks, the Federal Eeserve Bank of Cleveland, in accordance with the wise suggestion of the Federal Reserve Board and in common with the other Federal Reserve Banks, withdrew entirely from the market for municipal warrants, and has since purchased only small amounts of early maturing municipal bonds for which sinking funds had been provided, merely as an accommodation to member banks desiring to dispose of such bonds. The transactions in municipal warrants are shown in Exhibit J. RESERVE POSITION. The reserve position of the bank has remained strong in spite of the demands upon its loaning power. This has been due chiefly to the increased reserve required to be maintained in the Federal Reserve Banks by the amendment of section 19 of the Federal Reserve Act, but also in part to the large increases in capital and reserve deposits on account of the accession of important State banks to our membership, as well as the increase in the capital and surplus of banks already members; and in some degree also to the considerable sums of gold patriotically sent by both member and State banks to strengthen the position of the system, either as excess deposits or in exchange for Federal Reserve notes. Exhibit K shows the changes in reserve position during the year. STATE BANK MEMBERS. The movement of the larger and more progressive State banks to join the Federal Reserve system has been marked in this district. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 4 CLEVELAND. 363 This movement was known to be ultimately inevitable, and has been of course stimulated largely by the amendment of section 9 of the Federal Reserve Act as well as by a recognition of the added strength and prestige given to any bank by voluntary membership in the system, but has been also in large part due to a patriotic response to the forceful appeal of the President and a desire to do eveything necessary to fortify the position of our banking system against all possible' contingencies arising from the war. Some considerable credit must also be given to the member banks, who have shown in many cases their growing appreciation of the value of membership, thus encouraging nonmembers to join the system. The following State banks have been admitted to membership during the year: Date Capital of ad- Name of bank. Location of bank. and mission. surplus. 1917. Apr. 11 Cleveland Trust Co Cleveland, Ohio $5,000,000 July 2 Guardian Savings & Trust Co ....do 6,000,000 Nov. 1 Lawrence Savings & Trust Co New Castle, Pa.. 600,000 Nov. 8 Citizens Savings & Trust Co Ci^clevvv eyl^acinovdx,^ /mO hx ioci...... 8,000,000 Do.... Citizens Trust & Savings Bank Columbus, Ohio 850,000 Nov. 21 Ohio Bank & Trust Co Massillon, Ohio 187,500 Do.... Hillsboro Bank & Savings Co Hillsboro, Ohio 62,000 Nov. 24 City Trust & Savings Bank Youngstown, Ohio.. 350,000 Nov. 30 Union Trust Co. of Pittsburgh Pittsburgh, Pa 36,000,000 Dec. 3 Exchange Bank of Kentucky Mount Sterling, Ky. 75,000 Dec. 14 Pittsburgh Trust Co Pittsburgh, Pa 3,000,000 Dec. 28 First Standard Bank & Trust Co Maysville, Ky 235,000 Exhibit L shows the changes in the membership, in capital stock, and in reserve deposits during the year. RELATIONS WITH MEMBERS AND THE PUBLIC. Exhibit M shows the accommodation which has been extended to member banks through rediscounts and purchase of acceptances during the year compared with 1916. Overdrafts have been small in volume, and of those which have appeared a number have been due to delays in the mail service. The required reserve deposits of member banks have been quite generally maintained unimpaired, and although it has been necessary to assess penalties for deficient reserves upon a small number of banks each month, the disposition to maintain reserves in conformity with the law, or beyond requirements, has been apparent on the part of most banks. Weekly reports of required reserve are made by banks in the reserve cities and semimonthly reports by all other banks. One member bank has been closed by the comptroller during the year. The Federal Eeserve Bank of Cleveland has had no losses and has no past-due paper on its books. Digitized for FRAS3E4R36 5°-—18 24 http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

364 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. Through its Liberty loan transactions the bank has come into touch with the general public to a far greater degree than would have been thought possible at the beginning of the year. Arising out of this relation has come a realization of the functions played by the Federal Reserve Banks, not only as fiscal agents of the Government, but in steadying the money market and in providing for the distribution of the immense amounts of money and credit which have been moving throughout the country. This practical experience has confirmed the impression which the public very generally entertained even in advance of many banks, that the Federal Reserve system is a tremendously useful and practically indispensable servant of the public welfare; and undoubtedly great good is already resulting from the strengthening of this conviction. RELATIONS WITH THE GOVERNMENT. The relation of the Federal Reserve Bank to the Government is of course the outstanding feature of the year's history. In the Federal Reserve Bank of Cleveland a fiscal agency department, with a staff of 60 persons, has been created in a few months, occupying almost half of the entire floor space required by the bank. This department does not include members of the Liberty loan committees, but is occupied in the distribution of bonds and certificates, the collection of and accounting for payments, the arrangements with depositary banks, tabulation of data, and in general the handling of the business produced by the great success of the " sales force," the Libert}^ loan committee, which has rendered such conspicuous voluntary service. THE FIRST LIBERTY LOAN. The call of the Secretary of the Treasury for organization to obtain subscriptions to the first Liberty loan was received by the Federal Reserve Bank of Cleveland on May 3, 1917, and at an informal conference the immediate formation of a central Liberty loan committee to represent the entire district was deemed advisable. This was accomplished by requesting the clearing house associations in the 13 more important centers of population and banking resources to send one delegate each to the Federal Reserve Bank for a discussion of program and the formation of a permanent organization. These delegates met on May 12, 1917, and after a thorough discussion of the problem, in so far as its details could be foreseen at that time, effected the organization of a central Liberty loan committee. The committee thereupon appointed an executive committee. The members of the central Liberty loan committee were thereupon constituted chairmen of the local organizations in their respec- Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 4—CLEVELAND. 365 tive counties. The rural territory not directly covered by these committees appointed representatives who thereupon organized a separate county organization committee with subcommittees directed from Cleveland, Toledo, Columbus, Cincinnati, Pittsburgh, and Lexington. The 168 county areas within the Fourth Federal Keserve District were completely organized, the various security houses within the district contributing from their sales force members who were assigned to separate counties, and proceeded at once to organize county organizations. The district Liberty loan organization, as such was compelled un- ? der force of circumstances to use the Federal Reserve Bank as headquarters, and under the stress of conditions, this produced some confusion which in some degree hampered the committees, as well as the operating staff of the Federal Eeserve Bank. By June 1, 1917, there was thorough organization in every one1 of the 168 counties of the district, and the effect of this organization, entirely voluntary, became at once apparent. The organization was, of course, more highly developed in the larger centers, although the work of the rural county chairmen can not be spoken of with too high praise. The closing of subscriptions June 15, 1917, showed in possession of the Federal Reserve Bank, qaulified subscriptions in excess of $286,- 000.000 from 514,000 subscribers. The several areas reported as follows: Quota. Subscription. Quota Subscription. T P o it l t e s d b o urgh $8 17 0 , ,8 12 5 1 8 , ,0 1 0 00 0' Sil 1 l 6 ,0 ,0 4 0 7 8 , , 3 0 5 5 0 0 C Ci o n l c u i m nn b a u ti s.. $ 33 9 , ; 2 3 7 6 9 8, 0 5 0 0 0 0 $ 4 1 4 0, , 7 6 5 5 1 9 , , 5 4 5 5 0 0 Cleveland 71,756,000 96,998,850 Lexington.. 8,025,000 6,819,750 Exhibit N shows the subscriptions and allotments classified. SECOND LIBERTY LOAN OF 1917. Experiences of the first Liberty loan indicated clearly the wisdom and necessity of a separate location for the headquarters of the central Liberty loan committee and a more comprehensive staff in its organization. The executive committee appointed on the first Liberty loan campaign immediately held sessions with a view of perfecting such an organization. The personnel of the central Liberty loan committee, as well as the personnel of the executive committee, was largely unchanged. There were a few changes in the chairmanships of the various county committees, owing to illness, other activities, etc., but in the main the skeleton organization developed in the first campaign was retained, although extended in detail in many respects. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

366 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. The executive committee determined upon the policy of making a practical requisition upon each bank for its proportionate share of the amount of the second loan which the Secretary of the Treasury expected the fourth district to raise. With this end in view, the executive office of the committee carefully studied methods and means to establish just quotas of the banking resources of the district. In August, 1917, all banks within the district were asked to report the condition of their deposits as of June 15 and August 15, and also the amount of Liberty loan bonds of the first loan still in their possession. The response to this questionnaire was liberal and enabled the committee to establish the interesting fact that only a small percentage of bonds of the first Liberty loan was still in the hands of the banks, and, furthermore, that the deposits of institutions so reporting had increased from June 15 to August 15 between 3| and 4 per cent. The banks that did not report were considered as possessing the deposits given in the Rand-McNally Bankers' Directory of July 1, 1917, plus 3|- per cent, the average increase shown by the reporting banks. Upon this basis, a quota of so many dollars was fixed upon every banking institution in the district; and each bank was advised by special letter, received on October 1, of their proportion of the $300,000,000 of bonds which was the total minimum subscription asked of the Fourth Federal Reserve district by the Secretary of the Treasury. The effectiveness of the more comprehensive organization and the value of the well-learned lessons of the first loan campaign became quickly apparent as the second loan campaign gathered headway. Every bank in the district was requested to report the subscriptions obtained for each day upon " ke}^ed " cards furnished them for the purpose. This rather burdensome task was faithfully performed by about 80 per cent of the banks, and the committee wTas able to judge of the progress with more than ordinary accuracy from day to day. The entire 168 counties within the Fourth Federal Reserve district in the second campaign were divided into six " areas," administered from Cleveland, Cincinnati, Columbus, Pittsburgh, Toledo, and Lexington. The Liberty loan organizations in these six central points took upon themselves cheerfully, and performed with the greatest skill, the task of coordinating the campaign between each center and the counties assigned to it. Each area organization made every effort to exceed the minimum quota of every county within its area. The rivalry between the areas was healthful and helpful; the work of the county chairmen was most noteworthy in its zeal and efficiency. The organizations in each of the six area centers were highly developed, and were made up of an extremely skillful and high-powered personnel. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 4 CLEVELAND. 367 The distribution of publicity and its choice and preparation were excellent and far-reaching in their effect. The publicity bureau, which undertook to supply advertising and editorial matter for 912 papers within the district, prepared and distributed a large amount of extraordinary copy, and it is interesting to note that 850 newspapers out of the 912 whose cooperation was so requested, complied in the fullest degree. The result was a total subscription to the second Liberty loan in the Fourth Federal Reserve district in excess of $486 000 0Q0, re- 5 ? ported from 867,000 subscribers. The several areas reported as follows : Quota. Subscription. Quota. Subscription, Cleveland $92,725,200 $151,377,200 Columbus 112,511,900 819,502,800 Pittsburgh 127,819,500 205,541,100 Toledo.. 21.054,200 22,648,500 Cincinnati 36,701,100 74,776,450 Lexington 8,732,950 11,385,400 Exhibit O shows the number and amounts of subscriptions and allotments of the second Liberty loan, divided according to size of subscriptions in the classes fixed by the Secretary of the Treasury for the purpose of allotment. TREASURY CERTIFICATES OF INDEBTEDNESS. With each issue of Treasury certificates of indebtedness, an effort has been made not only to secure more than the district's proportion of the total issue, but also to assure as wide a distribution as possible. The earlier issues were brought particularly to the attention of banks throughout the district which had experience as distributors of high-grade bonds and note issues, and their hearty cooperation was uniformly secured. Exhibit P shows the total amount of each issue and the amounts allotted to the fourth district. The Federal Reserve Bank of Cleveland purchased varying amounts of each issue, chiefly for the purpose of having some of the certificates on hand for distribution to intending purchasers who had not subscribed before the subscriptions were closed; and in every case the amount held by the Federal Eeserve Bank found lodgment in the hands of purchasers within a very short time after the date of issue. FINANCING THE CARRYING OF WAR LOANS. For the first Liberty loan and the issues of certificates leading up to it, a rather remarkably small volume of rediscounting by the Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

S68 ANNUAL EEPOET OF THE FEDERAL EESEBVE BOARD. Federal Eeserve Bank was required, and the reports received from the banks under date of August 15 indicated that at that time practically all of the loan had been absorbed by the public, only a small amount of bonds being held by the banks themselves. For the second Liberty loan and the Treasury certificates issued in connection with it, a considerably larger volume of discounting has been done, and the indications are that a considerably larger volume of bonds is still in the hands of banks, although the proportion is not in the least a matter of concern. The total volume of member banks' collateral notes secured by Liberty loan bonds or certificates of indebtedness on July 15 was $1,050,000; on December 15, $10,885,550. The total volume of member banks5 customers9 paper, similarly secured, on our books on December 15 was $10,201,672.94. The exact corresponding figure for July 15 is not ascertainable, the records not being kept at that time to show this amount; but the amount was less than $1,000,000, Exhibit Q shows the total volume of rediscounts, both of member banks' notes secured by Government securities as collateral and of paper of customers of the banks secured by Government securities, for each month of the year. EXPENSE OF LIBERTY LOAN AGEXCY. For the first Liberty loan the sum of $75,000 was named as the amount of expense in the fourth district wThich the Treasury Department would reimburse, upon presentation of vouchers in due form, without question. The attempt was made to keep the expenditure within this sum, but tlie actual expense chargeable to the first Liberty loan to the date hereof is $104,593.05. For the second Liberty loan $200,000 was named as the available amount, and there has been expended to date $131,404.60. With considerable difficulty and gradually a capable office force has been built up for the clerical work of the Liberty loan committee, for the receiving of subscriptions and payments and accounting therefor, for issuing and exchanging certificates and bonds, for handling applications for designation as depositary for war-loan funds and conducting the business incident to such deposits, and for the other necessary work involved in oar functions as fiscal agent; and a total of $49,192.08 has been paid in salaries to date of this report. No fees or commissions have been paid; the banks of the district have performed their arduous duties in handling large numbers of small subscriptions and in many cases very small payments, and in distributing the bonds, without reimbursement of any sort. The expense of all newspaper advertising done in connection with the loans was contributed by public-spirited banks and business houses. The Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 4 CLEVELAND. 369 actual out-of-pocket expenses of representatives of the Liberty loan committees in traveling, purchasing supplies, etc., were refunded, as far as possible. GENERAL EFFECT OF GOVERNMENT FINANCING. The effect of the Government financing in district No. 4 has been undoubtedly similar to that in all other districts. There has been, naturally, an expansion in banking resources, a tightening of the rates for money, and the loaning ability of all financial institutions has been quite heavily drawn upon. Without doubt a part of the curtailment of building operations is due to the investment of funds in war loans which might otherwise have gone into such operations, as well as to the high cost of building. Many other forms of enterprise which are dependent upon a free supply of money for investment as fixed capital have been curtailed. The flotations of the loans, together with other influences of the war, has resulted in a decided trend toward the gradual exclusion of the purchase, and consequently the manufacture and distribution, of nonessentials. Manufacturers and dealers in nonessentiais are therefore beginning to be quite seriously affected. On the other hand, this tendency toward economy and thrift is undoubtedly having a very beneficial effect on all of the people, and after the pains of adjustment have been passed, the general situation should be sounder than before. Chart No. 4 shows the fluctuation of Government deposits during the year, and Exhibit E gives the same information in tabular form. RELATIONS WITH COMPTROLLER'S OFFICE. The bank has endeavored during the year to keep in close harmony with the office of the Comptroller of the Currency and the chief national bank examiner of the district, whose office is in the same building. Acknowledgment is very glady made of the cooperation which has been rendered by Chief Examiner S. H. L. Cooper and his staff. NOTE ISSUE. In the issue and redemption of Federal Eeserve notes, which has been a conspicuous feature of the year's operations, the experience of district No. 4 runs practically parallel wTith that of ail the other districts. A large number of notes have been issued in exchange for gold and gold certificates deposited with the bank, which have strengthened the general national situation very materially. The demands, however, for pay-roll currency have been constant and increasing, and far in excess of the currency deposited with this bank, Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

370 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. so resulting in a large increase in the volume of outstanding Federal Reserve notes. Of course, this currency expansion is in some degree necessary and inevitable at a time of greatly increased volume of business and higher cost of labor and commodities. The gold reserve against Federal Reserve notes, however, has remained strong throughout the year, and there is, in our judgment, little warrant for a fear that undue or unnecessary inflation is taking place. Chart No. 5 shows the movement of Federal Reserve notes and of gold reserve during the year, and Exhibit S shows the denominations issued, destroyed, and outstanding, as well as those exchanged with other Federal Reserve Banks. The cost of Federal Reserve notes issued, including redemption cost, was $75,526.78. BRANCH BANKS. The officers and directors of the Federal Reserve Bank of Cleveland have always had in mind the certainty that sooner or later it "would be desirable to establish branch banks in at least the two other large cities in the district. Upon the enactment by Congress of the amendment to the Federal Reserve Act, faciliating, among other things, the establishment of branches, in June of this year the Federal Reserve Board suggested that in their judgment the time had come when the system would shortly require this additional machinery. The distances in district No. 4 being comparatively short, there is not the same urgent necessity of branches as is evident in some of the districts covering larger areas. However, it was recognized that particularly in the collection of checks and in the payment and receipt of cash, there would be very great conveniences, particularly to the member banks in Cincinnati and Pittsburgh, in the location of branches in those cities. No requests had been made by the banks of either city, however, for the establishment of a branch until July 2, 1917, when the clearing house banks of Cincinnati, through a committee, forwarded to the directors of the Federal Reserve Bank of Cleveland a petition for the establishment of a branch in that city. The clearing house committee was immediately invited to confer with our directors on July 10, and at this and succeeding conferences the situation in Cincinnati was carefully considered. A committee of the board of directors was appointed to meet with Mr. Delano, of the Federal Reserve Board, at Cincinnati about the middle of August, and at the meeting of the directors on September 7 the committee reported, suggesting the establishment of a branch for the handling and collection of checks and drafts and the receipt and payment of cash. After further conference with the Cincinnati representatives, and exhaustive consideration of the by-laws and the probable operation Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 4 CLEVELAND. 371 of the branch on the part of the Federal Reserve Board and representatives of our directors, involving several conferences, the directors, at the meeting of October 5, recommended to the Federal Reserve Board that they be permitted to establish a branch at Cincinnati. In view of the probability that the plan of operation of this branch would constitute a desirable precedent for branches in other districts, the Federal Eeserve Board at once devoted itself and its counsel to thorough and careful deliberation upon the form and content of the by-laws. The Federal Eeserve Board having approved our recommendation on October 29, at the meeting of November 7 the directors of the Federal Eeserve Bank of Cleveland formally, by resolution, established the branch and named Mr. W. S. Eowe, president of the First National Bank; Mr. W. C. Procter, president of The Procter & Gamble Co., and Mr. L. W. Manning, secretary of the Federal Eeserve Bank of Cleveland, as their three appointees for directors of the Cincinnati branch, subject to the approval of the Federal Eeserve Board. The Federal Eeserve Board approved these appointments and itself appointed Mr. Charles A. Hinsch, president of the Fifth-Third National Bank of Cincinnati, and Hon. Judson Harmon, former governor of Ohio, as its appointees. Since that time the plans for opening the branch have gone forward as rapidly as possible ; quarters have been secured, part of the staff has been employed, vault and other equipment has been ordered, the accounting forms and procedure have been very carefulty worked out, and the beginning of the bank's operations is expected to occur early in January. Under date of October 17 a petition from the member banks of Pittsburgh for the establishment of a branch in that cit}^ was transmitted to our directors, some informal discussion having occurred prior to that time. With the experience and the.plan adopted at Cincinnati as a guide, somewhat more rapid progress was possible than in the case of Cincinnati, and after conference with the committee representing the Pittsburgh Clearing House Association, at the regular meeting of November 7 a resolution was adopted recommending to the Federal Beserve Board that permission be granted to establish a branch in Pittsburgh with powers similar to those of the Cincinnati branch. A committee was appointed to confer with the representatives of the clearing house association in Pittsburgh on November 14, and at the meeting of our board on December 8 the report of the committee was received and Messrs. E. B. Mellon, vice president of the Mellon National Bank; Charles W. Brown, president of the Pittsburgh Plate Glass Co., and George De Camp, national bank examiner, were named as the appointees of the Federal Re- Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

372 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. serve Bank of Cleveland on the directorate of the Pittsburgh branch. The Federal Reserve Board approved these appointments and named Messrs. T. XL Given, president of the Farmers Deposit National Bank, and J. D. Gallery, chairman of the board of directors of the Pittsburgh Railways Co., as its appointees. Mr. De Camp, designated as manager of the branch, was unable to secure release by the Comptroller of the Currency until January 1, but on that date will assume his duties, and the opening of the Pittsburgh branch should follow closely after that of the Cincinnati branch. INTERNAL MANAGEMENT. The board of directors has met 13 times during the year with an average attendance of eight. Fifty-three meetings of the executive committee have been held. Mr. E. P. Wright, secretary and treasurer of the Reed Manufacturing Co., of Erie, Pa., succeeded Mr. C. H. Bagley, of Cony, Pa., as a class B director on January 1, 1917, Mr. Bagley having been unable to stand for reelection because of poor health; and this has been the only change in the personnel of the board. Mr. W. S. Rowe has remained the member of the advisory council. On January 1, 1917, Mr. Horace G. Davis, then assistant to the Federal Reserve agent, was made an assistant cashier; and on September 1, Mr. F. J. Zurlinden, who had been head of the discount and investment department, was made an assistant cashier, as was also Mr. W. F. Taylor, who had been auditor; and Mr. G. H. Wagner, who had been assistant auditor, was made auditor. At this time areadjustment of the work of the bank, made necessary in large part by the establishment of the fiscal agency department, was effected, and Mr. M. J. Fleming, assistant cashier since January 1, 1916, took charge of the new department, the remainder of the operating departments being distributed under the supervision of the other three assistant cashiers. Owing to the increase in the work of all departments, many additions to the staff have been necessary, and there are now 64 employees in the banking department proper, 75 in the transit department, and 58 in the fiscal agency department. Of the bank employees, six are serving exclusively in the department of the Federal Reserve agent, which has required an increasing organization. On November 27 Mr. L. W. Manning, who had been with the bank since its organization, and had served since January 1 as secretary of the bank and assistant to the Federal Reserve agent, took office as manager of the Cincinnati branch. To accommodate the fiscal agency department it has been necessary to secure additional space, adjoining the quarters on the first floor of Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT 2ST0. 4 CLEVELAND. 373 the Williamson Building which have been occupied by the bank since January 1, 1917; and this space lias had to be built, covering a court between the two wings of the building. Our rapidly expanding functions have made it increasingly difficult to provide and arrange working facilities rapidly enough. An additional supply of vault equipment has been necessary, and the vault is now fully occupied with high-grade modern chests, in units which will be available in the event of any necessity of change in location. EXAMINATIONS. One complete examination of the bank has been made during the year by the Federal Reserve Board examiner and his staff: also a brief examination of the methods of the fiscal agency department while the first Liberty loan was being handled. CHECK COLLECTION AND CLEARING. The check clearing and collection system has grown with the other work of the bank during the year, and as a result of frequent invitations, 70 nonmember banks have been added to the par list, which now includes 5G5 of the 1,170 nonmember banks in the district. Exhibit T shows the volume of clearing operations. The operations of the gold settlement fund during the year ara fully covered in the report of the Federal Reserve Board. The immense usefulness and actual indispensability of this facility has been many times demonstrated in the shiftings of funds incident to th© Government financing. Exhibit U shows the monthly totals of debits and credits to the Federal Eeserve Bank of Cleveland in the gold settlement fund. Exhibit V is a tabular statement of the applications for fiduciary powers granted under the provisions of section Ilk of the Federal Eeserve Act, THE OUTLOOK. The conditions at the close of the year in district No, 4 are somewhat uncertain and difficult, by reason of the many complex problems awaiting satisfactory solution throughout the Nation, and the inevitable adjustments consequent upon the necessary emphasis on economy, and the concentration of effort upon only those enterprises which are essential to the winning of the war. The outlook can not be said to be wholly favorable to the continuance of unbridled prosperity therefore; but there is no pessimism as to the outcome, and no disposition to withhold any ounce of energy or sacrifice that may be called upon. It is evident that the power of service of Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

374 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. the Federal Reserve Bank of Cleveland may receive a severer test than any it has yet had; it is also evident that the confidence in the strength of this institution, as an integral part of the Federal Reserve system under the wise leadership that has been so evident during the past year, is unshakable and well founded. The officers and directors of the bank welcome the opportunity of service to the utmost, confidently counting upon the continually increasing cooperation of the banks and the people of the fourth district. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

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380 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. EXHIBIT A.—Gross earnings, classified, expenses, and net earnings, 1917, Month. m c B o e il u m l n s b t d e e i d r s s , - . m i b n o B a o u i r l p k L g e e h s n t t . S c U t u a r n t i e i t t i s e e d s s e . - e A a l r l n o in th g e s r . Tot i a n l g e s a . rn- ' T p o e t n a s l e e s x . - Ne in t g ea s. rn- January... $2,093.53 $20,558.76 $17,693.35 $24,768.00 $65,113.64 $12,104.12 $53,009.52 February.. 3,633.21 22,425.74 15,167.09 11,486.90 52,712.94 15,152.89 37,560.05 March 5,630.09 19,764 36 15,048.93 10,707.17 51,150.55 15,207.13 35,943.42 April 7,587. 62 12,773.94 22,494.73 11,159.49 54,015.78 18,177.89 35,837.89 May 6,145.43 23,655.19 26,516.28 9,902.67 66,219.57 20,214.55 46,005.02 June 16,118.35 28,267.88 22,653.47 6,042.67 73,082.37 23,006.16 50,076.21 July 24,740.22 29,094.26 19,804.09 5,103.09 78,741.66 20,731.55 58,010.11 August 26,261.09 51, 709. 62 22,979.42 6,139.90 107,090.03 17,048.01 90,042.02 September. 25,779.67 63,765.62 26,105.75 2,079.48 117,730.52 24,933.76 92,796.76 October... 34, 794.80 56,421.88 33,351.16 6,827.76 131,395.60 28,244.19 130,151.41 November. 67,360.98 88,619.75 29,306.82 8,438.52 193,726.07 33,250.99 160,475.03 December. 155.023.91 79,654.58 66,803.33 4,598.59 306,080.41 91,233.07 214,847.34 Total 375,168.90 496,711.58 317,924.42 107,254.24 1,297,059.14 319,304.31 977,754.83 EXHIBIT B.—Average earning assets classified, and average rates for the 12 months of 1911 and corresponding months of 1916, [In thousands of dollars; i. e., 000 omitted.] 1917 1916 1917 1916 1917 Month. in f T u v o n e d t s a s t l e . d A r a a v g t e e e r . - in f T u v n o e d t s a t s e l . d A r a a v g t e e e r . - B co m i b l u l e e s n r m t s d e . - i d s , -A r a a v g t e e e r . -B c m o i b l u l e e s n m r t s d e - . i d s , -A r a a v g t e e e r . - i m b n B o a o u i r l p k g l e s e h n t t . A r a a v g t e e e r , - January 19,079 2.84 6,713 2.26 596 4.14 415 4.59 8,718 2.78 February 20,633 3.00 7,593 2.71 1,264 3.77 272 4.68 9,877 2.96 March .. . 19, 356 2.98 9,222 2.62 1,816 3.65 254 4.31 7,578 3.07 21,958 2.81 11,175 2.53 2,519 3.67 436 4.10 5,025 3.09 May 25,904 2.92 14,551 2.44 1,967 3.68 284 4.35 8,945 3.11 June 28,780 3.03 15,802 2.48 5,245 3.74 277 4.42 10,987 3.13 July 28,719 3.18 18, 4.50 2.55 7,769 3.75 420 4.26 10,935 3.13 August 38,649 3.18 18,306 2.60 8,248 3.74 282 4.56 19, 505 3.12 September.. 43, 720 3.22 17,461 2.63 8,695 3.61 598 4.19 23,976 323 October . . 44,611 3.29 18,163 2.74 10,978 3.73 371 4.49 20,147 3.29 November . 65,010 3.47 17,576 2.72 21,200 3.87 272 4.16 31,790 3.39 December 93,554 3.79 21,468 2.75 43,105 4.24 1,206 3.84 26,175 3.58 1916 1917 1916 1917 1916 Month. Bills Aver- Munici- Aver- Munici- Aver- United Aver- United Averbought age pal war- age pal war- age States age States age in open rate. rants. rate. rants. rate. bonds. rate. bonds. rate. market. January 981 1.94 1,973 3.40 2,816 2.97 7,792 2.66 2,501 2.57 February 976 1.93 2,670 3.05 2,955 2.93 6S822 2.90 3,390 2,65 March 1,122 1.92 3,112 3.20 3,853 2.78 6,850 2.59 3,994 2.54 April 1,689 1.95 2,987 3.21 4,869 2.55 11,427 2.48 4,181 2.56 May 2,613 1.99 2,891 3.20 5,486 2.59 12,101 2.58 6,167 2.39 June 4,401 2.06 1,554 3.58 4,510 2.90 10,995 2.50 6,614 2.38 July 6,596 2.14 1,237 3.63 4,781 2.85 8,778 2.66 6,653 2.63 August 7,052 2.25 1,075 3.70 4,597 3.06 9,821 2.75 6,375 2.60 September 7,285 2.33 33 3.44 2,780 3.10 11,015 2.88 6,799 2.62 October. . 6,695 2.41 12 4.62 4,219 3.27 13,475 2.91 6,878 2.65 November 6,884 2.41 12 4.44 3,680 3.40 12,009 2.97 6,739 2.53 December 9,590 2.58 11 4.00 2,713 3.93 24,263 3.24 7,960 2.40 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTBICT NO. 4 CLEVELAND. 381 EXHIBIT B.—Average earning assets classified, and average rates for the 12 months of 1917 and corresponding months of 1916—Continued. SUMMARY OF INVESTMENT OPERATIONS. 1917 1910 Daily average of funds employed during year: Bills discounted, members , $9,531,458.45 $425,175.75 Bills discounted, bought 15,348,152.44 4,672,647.68 Municipal warrants 1,457,325. 80 3,943,462.52 United States securities 11.314,574.40 5,692,548.42 Total 37,651,511.09 14,733,834.37 Total volume of business handled: Bills discounted, members 211,176,105.36 6,792,429.30 Bills discounted, bought 91,109,193. 06 27,542,002.24 Municipal warrants 2,949,074. 30 10,660,237.45 United States securities 69,707,100. 00 11,721,160. 00 Total 374,941,472.72 56,715,828.99 Average capital 6,433,207.00 5,982,695.00 Rate of gross earnings on capital per cent.. 20 7.17 EXHIBIT C.—Statement of condition of the Federal Reserve Bank of Cleveland at the close of business, Dec. 31, 1917, compared with Dec. 30, 1916. 1917 1916 RESOURCES. Bills discounted, members $37,163,027.27 $1,006,773.50 Advances to members on eligible collateral 33,733,150.00 Acceptances bought 21,111,990.95 10,153,694.75 Investments, short-time municipal obligations 7,233.38 2,684,589.64 United States bonds and securities: 2 per cent bonds (consols and Panamas) 473,600.00 2,403,900.00 3 per cent bonds, 1918 2,653,660.00 2,586,560.00 4 per cent bonds, 1925 : 2,378,200.00 2,369,200.00 3 per cent one-year Treasury notes 3, 221,000.00 618,000.00 3 per cent conversion bonds 414,800.00 1,800.00 3i per cent first Liberty loan bonds *. 2,027,000.00 4 per cent second Liberty loan bonds 320,750.00 4 per cent United States Treasury certificates of indebtedness due June 25, 1918 50,000.00 Total funds employed, 103,554,411.60 21,824.517. 89 Accruueedd iinntteerreesstt oonn UUnniitteedd SStates securities 62,878.48 297;660.08 Cost of unissued Federal Reserve notes 39544.25 Furniture and equipment 20;163.92 Expense paid in advance 934. 76 Due from other Federal Reserve banks 45,176,685.19 14,921,032.18 Due from banks and bankers 11,792.01 129;610. 22 Deferred debits 23,162,771.93 10,417:595. 49 Gold coin and certificates on hand 29,153,275.00 15, 76i;382. 50 Gold settlement fund 37,664,000.00 16,953,000. 00 Gold redemption fund 98,800.00 42,250. 00 Gold with Federal Reserve agent 55,369,700.00 10,832,305. 00 Gold with foreign agencies 4,725,000.00 Legal tender notes and silver certificates 238,369.00 484,417.00 Federal Reserve notes on hand 3,666,525.00 588,935.00 Other cash and coin 1,081,302.20 91,816. 77 M Du u e ti f l r a o te m d d cu ep rr o e s n i c ta y r y fo b rw an a k rd s e a d n d fo t r r r u e s d t e c m om pt p io a n nies 1 68, 8 0 6 5 6 1 , , 2 1 6 5 5 4 . . 0 9 0 8 140,000.00 Other resources 139,247. 83 28,554.65 Total resources. 373,022,178.22 92,573,719. 71 LIABILITIES. Capital paid in 100.00 6,021,800.00 Profit and loss 132,311.58 94, 797. 44 Unearned interest and discount 190,643. 23 37,978.59 United States Government deposits 30,578,247.23 974,809. 73 Due to member banks (reserve account) 109,724,561.05 54,586,226.61 Due to nonmember banks (clearing account) 94,160.59 Due to other Federal Reserve banks 33,970,479.80 11,263,136.20 Deferred credits 16,553,514.19 8,759,174. 62 Federal Reserve notes outstanding 105,669,700.00 10,832,305.00 Treasurer of the United States (special deposit account) 34,242,100.00 Treasurer of the United States (Liberty loan deposit account). 33,809,054.98 Other liabilities 31,305.57 3,491. 52 Total liabilities., 373,022,178.22 92,573,719.71 iWar loan deposits. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

382 ANNUAL REPOET OF THE FEDERAL 'RESERVE BOAED. EXHIBIT D.—Profit and loss account. 1917 1916 Profit and loss balance Dec. 30,1916 $94, 797.44 Earnings from—• Bills discounted members 375,169.00 $18,064.41 Bills discounted, bankers' acceptances 496,711.58 106,993.11 Municipal warrants . . . 48,131.73 116,925.13 Interest earned on United States securities 317,924.42 144,843.65 Profits realized on United States securities 24,260.69 37,228.53 Sundry earnings, including service charge transit department, and exchange bought and sold 63,145.30 5,101.50 Total 1,420,140.16 429,156.33 Expenses: Assessment for expenses of Federal Reserve Board 25,783.40 Cost of Federal Reserve notes issued 72,280.77 5,876.44 Cost of unissued Federal Reserve notes 18,975.62 Premium on United States bonds and securities charged off. 209,469.52 Operating expenses, including amortization of furniture, vault and equipment and other accounts 245,150.97 185,251.94 Dividend paid 716,168.30 143,236.51 Profit and loss credit balance 132,311.58 94,797.44 Total 1,420,140.16 429,156.33 Percentage of net earnings to average capital: 1916 3.98 1917 15.2 EXHIBIT E.—Resources of member banks. Nov. 20, 1917. Nov. 17, 1916. Member banks, total resources $1,985,977,000 $1,498,515,000 Deposits: Demand 1,172,813,000 930,705,000 Time 402,519,000 235,112,000 COMPARISON OF DEPOSITS OF THE MEMBER BANKS IN THE THREE LARGEST CITIES IN DISTRICT NO. 4. Cincinnati. $108,893,000 $97,411,000 Cleveland 1 318,680,000 146,409,000 Pittsburgh 411,214,000 315,130,000 1 Includes three State banks admitted to membership during 1917. EXHIBIT F.—Operations in discounts and investments department. 1917 1916 Bills discounted, members: Commercial and industrial. $72,948,095. 22 $4,232, 244.04 Trade acceptances. 4, 400,589.19 175,185.26 Agricultural and live stock 167,575.28 Rediscounts, secured by United States obligations 15,126,195.67 Member bank collateral notes, secured by United States obligations 66,089,550.00 Member bank collateral notes, secured by eligible paper 53,444,100.00 2,385,000.00 Total.. 212,176,105.36 6, 792,429.30 Classification by maturities: Within 15 days , 147,846,219.88 2,288,100.00 16 to 30 days 26,101,442.96 3,203,600.00 31 to 60 days 18, 773,616.49 778,100.00 61 to 90 days 19,386,885.84 376,000.00 Beyond 90 days , 67,940.19 146,600.00 Total., 212,176,105.36 6, 792, 400 00 Average rate per cent: 1917 . 3.29 Digitized for F1R91A6SER . 4.25 http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTEICT NO. 4 CLEVELAND. 383 EXHIBIT G.—Discount rates. MEMBER BANK COLLATERAL NOTES. 1 to 15 days. In force— Secured Secured by eligi- by ble United paper. States securities. Jan. 1, 1917.. 31 May 10, 1917. 3 Sept. 25, 191/ 31 Dec. 1, 1917. 31 REDISCOUNTS—COMMERCIAL PAPER. In force- Itol5 16 to 30 31 to 60 61 to 90 days. days. days. days. Jan. 1, 1917 31 4 4i 41 Apr. 16, 1917 31 4 41 June 6, 1917.. 31 4 4 41 Dec. 1, 1917.. 4 4J 41 41 TRADE ACCEPTANCES. In force- 1 to 15 16 to 30 31 to 60 61 to 90 days. days. days. days. Jan. 1, 1917... 3 3 31 4 Apr 16, 1917 31 31 31 4 Dec. 10, 1917 4 4 4 AGRICULTURAL AND LIVE-STOCK PAPER. Itol5 16 to 30 31 to 60 61 to 90 Beyond In force— days. days. days. days. 90 days. Jan. 1, 1917.. 31 4 4\ 41 Apr. 16, 1917. 31 4 4 41 June 6, 1917. 31 4 4 4:V Dec. 1, 1917.. 4 41 41 COMMODITY PAPER. In force— Itol5 16 to 30 31 to 60 61 to 90 days. days. days. days. Jan. 1, 1917... f 4 41 Apr. 16, 1917 4 REDISCOUNTS SECURED BY UNITED STATES GOVERNMENT SECURITIES. In force— Itol5 16 to 30 31 to 60 61 to 90 days. days. days. days. June 15,1917 31 f 31 Sept. 25, 1917... 4 Dec. 10, 1917 31 4 4 Open-market purchases of bankers' acceptances: In force- Jan. 1,1917 .percent. 21 to 4 Dec. 1,1917 do... 3 to 41 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

384 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. EXHIBIT H.—Bills bought in open market {acceptances). 1917 1916 Bankers, export and import.. $73,538,033.79 $27,237,090.49 B ankers, domestic 15,195,883.59 304,905.75 Dollar exchange bills 64,675.00 Foreign trade acceptances 1,771,711.82 Domestic trade acceptances.. 538,888.86 Total. 91,109,193.00 27,542,002. 24 Classfication by maturities: Within 15 days 3,190,925.72 16 to 30 days j 11,318,356.10 1,542,425.48 31 to 60 days I 26,055,907.18 5,788,427.94 61 days to 3 months | 50,544,004.06 20,211,148.82 Total. 91,109,193.06 27,542,002.24 "I Average rate per cent: 1917, 3.23; 1916, 2.29. EXHIBIT I.—Operations in United States securities, 1917. Sold, On hand Purchased paid, and On hand Dec. 30, during converted Dec. 31, 1916. 1917. during 1917. 1917. United States Government 2 per cent consols $903,900 $66,400 $963,900 $6,400 United States Government 2 per cent Panamas 1,500,000 1,230,500 2,263,300 467,200 United States Government 2 per cent certificates of indebtedness 3,500,000 3,500,000 United States Government 3 per cent Spanish war loan. 2,586,560 67,100 2,653,000 United States Government 3 per cent 1-year Treasury notes... 618,000 4,297,000 1,694,000 3,221,000 United States Government 3 per cent 30-year conversion "bonds 1,800 1,616,200 1,203,200 414,800 United States Government 3 per cent certificates of indebtedness 4,645,000 4,645,000 United States Government 3i per cent certificates of indebtedness 124,000 124,000 United States Government 3£ per cent certificates of indebtedness 1,460,000 1,460,000 United States Government 3i per cent Liberty loan 2,280,700 253,700 2,027,0-30 United States Governent 4 per cent bonds of 1925 2,369,200 92,700 83,700 2,378,200 United States Government 4 per cent Liberty loan 504,000 183,250 320,750 United States Government 4 per cent certificates of indebtedness United States Government 4 per cent certificates of 15,827,500 15,777,500 50,000 indebtedness, held under sale and repurchase agreement 34,000,000 6,000,000 28,000,000 Total 7,979,460 69,711,100 38,151,550 39,539,010 EXHIBIT J.—Municipal warrants purchased. 1917 1916 City $2,846,166.00 $10,051,988.72 State... 260,028.02 County. 51,803.22 172,845.36 Other... 51,105.08 175,375.35 Total. 2,949,074.30 10,660,237.45 Classification by maturities: 18 to 30 days 2,582.50 381,633.20 31 to 60 days 5,129.16 2,221,525.63. 61 to 90 days 692,42"/. 16 497,590. 02 Beyond 90 days to 6 months. 2,248,955.48 7,559,488.57 Total. 2,949,074.30 10,660,237.45 Average rate of earnings,, per cent: 1917 3.30 1916 % 97 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 4 CLEVELAND. 385 EXHIBIT K.—Changes in the reserve position of the bank during the year. Month. R p e e q r u i c r e e n d t ) ( . 35 Carried. Per cent. Excess. Per cent. January $19,883,243.45 $44,595,102.35 78.5 $24,711858.90 43.5 February 20,140,947.75 41,875,468.60 72.8 21,734,520.85 37.8 March 21,830,493.30 46,497,955.45 74.5 24,667,462.15 39.5 April 21,687,821.40 41,690,550.30 67.2 20,002,728. SO 32.2 May 25,065,025.00 48,165,198.00 67.2 23,100,173.00 32.2 June 36,889,015.84 80,637,413.80 76.5 43,748,397.96 41.5 July 36,708,766.86 85,612,601.80 81.6 48,903,834.94 46.6 August 39,388,127.89 90,415,959.50 80.3 51,027,831.61 45.3 September 33,778,158.72 72,264,790.85 74.8 38,486,634.13 .39. 8 October 36,779,019.87 80,024,672.10 76.2 43,245,652.23 41.2 November 46,830,071.96 90,934,366.65 67.9 44,104,294.69 32.9 December 42,637,220.05 71,780,815.85 58.9 29,143,595.80 23.9 EXHIBIT L.—Member banks, district No. Jf. Number of member banks, Dec. 31, 1916 753 New national banks organized 2 State banks and Trust companies admitted 12 767 Closed by Comptroller of the Currency 1 Liquidated 2 3 Number of member banks Jan. 1, 1918 764 Distribution : In reserve cities 50 In other than reserve cities 714 Total 7G4 Total capital stock Dec. 31, 1916 ""$12, 043, 600 •Stock allotted member banks for quarter ending— March 31, 1917 $145,500 June 30, 1917 326,900 Sept. 30, 1917 431, 300 Dec. 31, 1917 3, 135, 900 4, 039, 600 Total 16, 083, 200 Stock surrendered quarter ending— Mar. 31, 1917 10,400 June 30, 1917 11, 600 Sept. 30, 1917 6, 100 Dec. 31, 1917 . 2,900 31, 000 Total capital stock Dec. 31, 1917 . 16, 052. 200 Total paid-up capital stock Dec. 31, 1916 6, 021, 800 Subscriptions paid in quarter ending— Mar. 31, 1917 72 750 June 30, 1917 163 450 Sept. 30, 1917 215', 650 Dec. 31, 1917 1,567,950 2,019,800- Total 8, 041, 600 Cash subscriptions refunded for surrender of stock quarter ending— Mar. 31, 1917 5,200 June 30, 1917 5,800 Sept. 30, 1917 3, 050 Dec. 31, 1917 1,450 15, 500 Total paid-up capital stock Dec. 31, 1917 .__ 8,026,100 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

386 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. EXHIBIT M.—Accommodation of member banks through discount of paper. Banks Applications accommodated. handled. 1917 1916 1917 1916 Kentucky 12 8 70 60 Ohio 102 32 974 152 Pennsylvania 44 9 153 26 West Virginia 2 1 9 2 Total. 160 50 1,206 240 Total pieces handled in 1917,14,050; in 1916,1,401. Amount of smallest note or bill rediscounted, $28.85. Amount of largest note or bill rediscounted, $13,500,000. EXHIBIT N.—First Liberty loan of 1917. Subscriptions. Allotment. Class A, $50 to $10,000 $128,811,700 $128,811,700 Class B, $10,050 to $100,000. 76,365,950 47,060,450 Class C, $100,050 to $250,000. 23,239,300 10,457, 700 Class D, $250,050 and up... 57,814,050 16,970,200 Total 286,231,000 203,300,050 EXHIBIT O.—Second Liberty loan of 1917. N su u t b m io s b c n e r s i r . p o - f su A b m sc o ri u p n t t i o o n f s. Allotment. Class A, $50 to $10,000 783,972 $172, 996,050 $172,996,050 Class B, $10,050 to $50,000.. 2,844 79,545, 600 79, 545, 600 Class C, $50,050 to $100,000.. 549 48,352, 850 43,553, 700 C C l l a a s s s s E D , ? $ $ 2 1 0 0 0 0 , , 0 0 5 5 0 0 a to n d $ 2 u 0 p 0,000, 2 1 1 9 8 9 1 3 3 5 6 , ,5 4 9 8 8 7, , 9 8 5 0 0 0 2 7 6 4 , , 7 3 3 98 2 , , 8 7 5 0 0 0 Cash sales 1,265 13,125,550 13,125,550 Total 789, 047 486,106, 800 410, 352,450 EXHIBIT P.—Certificates of indebtedness. Date of issue. Amount. Allotment. Date of issue. Amount. Allotment. Apr.25 $268,205,000 $14,000,000 Sept.17 $300,000,000 $24,180,000 May 10 200,000,000 15,000,000 Sept. 26 400,000,000 34,209,000 May 25 200,000,000 10,800,000 Oct. 18 385,197,000 38,863,000 June 8 200,000,000 19,100,000 Oct. 24 685,296,000 • 26,471,000 Aug.9 300,000,000 33,592,000 Nov. 30 091,000,000 115,230,500 Aug. 28 250,000,000 24,157,000 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTEICT NO. 4 CLEVELAND. 387 EXHIBIT Q.—Rediscounts of paper secured by Government securities. Member Member Rediscounts bank col- Rediscounts bank colsecured by lateral notes secured by lateral notes U. S. bonds secured by U. S. bonds secured by and certifi- U. S.bonds and certifi- U. S.bonds cates. and certifi- cates. and certificates. cates. May $550,000.00 October $7,542.50 $12,885,000.00 June $49 250.00 1 957 000.00 November 8,594,833.03 13,574,250. 00 July 858,209.25 2,210,000.00 December 5,106,237.14 18,870,300.00 A Se u p g t u em st ber 510,123. 75 9 7 , , 0 0 1 2 8 5 , , 0 00 0 0 0 . . 0 0 0 0 Total 15,126,195. 07 66,089,550.00 EXHIBIT R.—Government deposits, 1917. January $1, 216, 035. 12 July 18, 272, 174. 61 February 712, 815. 21 August 11, 136, 745. 93 March 3, 913, 251. 22 September 6,499, 959. 71 April 6, 597, 627. 26 October 12, 719, 069. 72 May 5, 182, 731. 99 November 22, 179, 485. 22 June 3, 293, 614. 65 December 30, 575, 641. 65 EXHIBIT S.—Federal Reserve notes. COVER OF NOTES ISSUED. Gold coin and certificates $5,804,545 United States Treasury gold order certificates 9,110,000 Gold redemption fund with United States Treasurer 5,455.155 Credit balance with Federal Reserve Board 35,000,000 Paper held as collateral for Federal Reserve notes (actual amount, $51,254,883.29) required... 50,300,000 Total 105,669,700 DENOMINATIONS OF FEDERAL RESERVE NOTES ISSUED, DESTROYED, AND OUT- STANDING, NOVEMBER, 1914, TO DECEMBER 31, 1917. Denomination. Issued. Destroyed. Outstanding. Fives.. $11,620,000 $2,672,250 $8,947,750 Tens . 26,640,000 2,931,940 23,708 060 Twenties '54, 800,000 2,934,860 51,865,140 Fifties 16,000,000 299,250 15,700,750 Hundreds 5,600,000 152,000 5,448,000 Total 114,660,000 8,990,300 105,669,700 Returned for destruction by Federal Reserve agent $720,000 Returned for destruction by other Federal Reserve banks 781,955 Returned for destruction by Treasurer of the United States and Federal Reserve Bank of Cleveland 8,008,345 Total 8,910,300 FEDERAL RESERVE NOTES RECEIVED AND RETURNED. (Amounts of Federal Reserve notes received from other Federal Reserve Banks for redemption or credit and returned to other Federal Reserve banks for redemption or credit by the Federal Reserve Bank of Cleveland for the period Jan. 1 to Dec. 31,1917.) Exchanged with Federal Received Returned Exchanged with Federal Received Returned Reserve Bank of— from. to. Reserve Bank of— from. to. Boston $352,900 $36,415 Minneapolis.. $51,500 $116,030 New York... 1,720,700 1,216,800 Kansas City.. 25,000 66,740 Philadelphia- 835,000 247,995 Dallas 299,640 39,410 Richmond. .. 133,950 100,600 San Francisco 69,545 36,840 Atlanta 282,150 72,180 Chicago 1,178,650 418,040 Total... 5,175,740 2,534,070 St. Louis 226,705 183,020 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

388 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. EXHIBIT T.—Clearings, 1911. Daily average. Number of items. Amount. Number of items. Amount. January 435,384 $218, 777,981.82 16,745 $8,414,537.76 February.. 377,911 186,342,030.19 16,431 8,101,827.40 March 454,580 236,308,813.73 16,836 8,752,178.28 April 434,129 248,982,095.96 17,365 9,959,283.83 May 471, 797 299,213,801.47 18,146 11,508,223.13 June 492,316 355,994,450.53 18,935 13,692,094.25 July 463, 713 379,309,461.52 18,548 15,172,378.46 August 469, 594 368,449,776.41 17,392 13,646, 288.01 September. 522, 431 338,747.136.48 20,897 13,549, 885.45 October 573, 698 412,879,353.88 21, 248 15, 291,827.92 N D o ec v e e m m b b e e r r . . . 5 6 8 2 5 0 y , 5 0 9 1 1 6 4 45 3 2 4 , , 2 8 3 1 3 8 , , 3 4 6 5 7 4 . . 8 5 5 5 2 2 4 2 , , 8 5 2 0 4 0 1 1 6 8 , , 0 72 8 3 9 , ,3 7 3 8 4 6. . 7 7 1 2 Total number of items handled 5,901,160 Total amount handled $3,932,056,724.39 Disbursements, Transit Department $83,491.93 Cost per item handled cents.. 1.41 Cost per §1,000 do 2.12 Service charge per item do 1.5 EXHIBIT TL--MontMy totals of debits and credits to the Federal Reserve Bank of Cleveland in the gold settlement fund. Debits, 1917. Credits, 1917. Debits, 1916. Credits, 1916. January $77,036, 000 $67,437,000 $4, 868,000 $5,356,000 February.. 71, 849,000 72,001,000 4,163, 000 4,346,000 March..!... 105, 615, 000 103,575,000 8, 290,000 6,368,000 April 96,190,000 101,785,000 6,440,000 4,367,000 May 170,168,000 164, 707,000 8,418,000 11, 919, 000 J Ju u n ly e 2 1 0 7 3 6 , , 4 7 5 4 5 5 , ,0 6 0 0 0 0 2 1 0 55 6 , , 0 8 3 2 7 2 , ; 0 0 0 0 0 0 1 1 1 2 , , 9 7 0 1 4 4 , , 0 0 0 0 0 0 1 1 2 3 , , 8 0 2 3 2 0 , , 0 0 0 0 0 0 August 233, 538, 000 223, 541,000 32,241,000 30, 773,000 September. 177,293,000 193,568,000 41,021,000 43, 219,000 October 206,495, 800 199, 039,300 50,245, 000 49,017,000 November. 338, 084, 000 325, 077, 600 57,217,000 65,162, 000 December.. 334,888,500 358,057, 000 70,908,000 67,903, 000 Total. 2,191,357,900 2,170,64.6,900 308,429,000 314,340,000 Balance Dec. 30,1916.. . $16,953,000 Balance Dec. 31,1917.. . 37,664,000 EXHIBIT V.—Fiduciary powers granted. Powers granted. Ohio. Trustee only Registrar of stocks and bonds Trustee and registrar of stocks and bonds Trustee, executor, administrator, and registrar of stocks and bonds . Total coco Total v P a s e y n n l i - n a - . tu K c e k n y - . g W V in e i i r s a - t . Total. g o s r r i a g n n a c t n e e i d zation, 1 1 6 3 5 3 11 1 t 7 I 6 1 1 8 29 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 5—RICHMOND. CALDWEIL HARDY, Chairman and Federal Reserve Agent. This bank, with the other Federal Reserve Banks, as well as member banks of the entire system and country, has been called upon to extend its activities over a wide field in the service of the Government in the floating of bonds and certificates of indebtedness and in the handling of extensive national financing. This country's entrance into the wrar necessitated the immediate raising of large sums of money, followed as early as practicable by more permanent financing. Under the war bill passed in April the early financing, as well as the later interim financing between bond issues hereafter referred to, was effected by certificates of indebtedness. The following table will give particulars as to these issues of certificates of indebtedness, showing the amount subscribed for and allotted in this district. The response in the district in subscriptions to these certificates was prompt and generous, particularly so when it is taken into consideration that the money was required largely during the crop planting and raising period, during which money is always particularly in demand. Certificates of indebtedness. Date. Maturity. A o m ffe o r u ed n . t Rate. Subscription. Allotment. 1917 1917. Pr. ct. Mar. 31. June 29. 150,000,000 2 $2,000,000 S2,000,000 Apr. 25 June 30.. 200,000,000 3 . 5,850,000 5,850,000 May 10 July 17.. 200,000,000 3 2,753,000 2,753,000 May 25 July 30.. 200,000,000 3-t 2, 768,000 2,000,003 JuneS .do.. 200,000,000 4,027,000 3,601000 Aug. 9 Nov. 15 300,000,000 ^ 3,400,000 2,800,000 Aug. 28 Nov. 30 250,000,000 34 8,932,000 7,235,000 Sept. 17 Dec. 15 300,000,000 31 3,180,000 .3,180,000 Sept. 26 do 400,000,000 4 7,004,000 7,004,000 Oct. 18 Nov. 22 300,000,000 4 8,323,000 8,323,00(1 Oct24 Dec. 15 0) 4 11,472,000 11,472,000 1918. Nov. 30 June 25 4 2,415,000 2, 415,000 62,124,000 j 58,632,000 i Limited amount. 389 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

390 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. Payments for the above certificates were made through this bank with remarkable facility and without disturbance to the finances of the district. Following the early temporary financing through certificates of indebtedness, came the more permanent financing through the first issue of Liberty bonds. This necessitated a permanent organization of every force to be availed of in the financial campaign. That organization took the following form: GENERAL SCHEME OF THE LIBERTY LOAN ORGANIZATION. A district committee, with the governor of the Federal Reserve Bank as chairman, and consisting of the chairmen of the central Liberty loan committees of the several States. State committees consisting of members from the various important sections of each State, acting with and through the central committee located in the capital of each State. Local committees in all cities and banking places where it was possible to form such committees, consisting of representatives of all important industries of the place. A Liberty loan bureau in each banking institution. A publicity department connected with each State committee, with headquarters in the capital of each State. A speakers' bureau located in the Federal Reserve city—Richmond—operated in connection with the speakers' bureau at Washington. Each banking institution at the beginning of the campaign was advised of its proportionate amount of the loan based upon its resources. In some cities the State committee divided the State into counties and a friendly rivalry between the sections was brought about, as well as a rivalry between the separate banking institutions. In Richmond all members of the committees were assigned to solicit subscriptions from the customers of their respective institutions. Other members of the committees were assigned to the work of arousing interest on the part of members of their respective organizations as selling agents for the bonds. The speakers' bureau carried the message through the theaters, churches, schools, factories, and other gathering places of people. A ladies' committee was authorized to operate booths in the large stores in the retail district and enlisted all the women's organizations of the city. Nearly all the banks adopted a club system for selling Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 5—RICHMOND. 391 bonds on the installment plan—payments of $1 cash and $1 each week thereafter for each $50 bond. A parade and mass meeting were arranged, the former embracing many societies and the school children of the city. At the mass meeting the public was invited, and the war situation was ably presented by one of our United States Senators. Publicity was obtained by billboards, window hangers, distribution of circulars, stickers, etc., and a news article daily in each newspaper. Business houses contributed the advertising space. These same methods were urged in every locality throughout the district. The amount of subscriptions asked for to the first Liberty loan at 3J per cent was $2,000,000,000; the quota expected from this district was fixed at a minimum of $80,000,000 and a maximum of $100,000,000. The subscriptions amounted to $109,737,100 and the allotment made was $88,593,650. Payments required were 2 per cent with subscriptions and 18 per cent on June 28; 20 per cent on July 30; 30 per cent on August 15; 30 per cent on August 30. While it required a wide and energetic campaign, reaching, so far as possible, every individual and family in the district, when the novelty of the appeal is taken into consideration, the large majority of our population having little or no information in regard to, or conception of, the necessities or conditions relating to the situation, the response might well be regarded as remarkable. The effect of these subscriptions on banking institutions and their condition, and on the industries and commerce of the district, was apparently negligible. The bank deposits in the district more than held their own, and no interests, either agricultural, industrial, or commercial, suffered from lack of banking accommodations. It may be asserted with reasonable safety that the actual effect of this financing was far less than the first estimates placed upon it. It was manifestly impossible to determine accurately the cause for the increased banking accommodations asked for during the financing of these subscriptions, and while this accommodation in amount represented a considerably increased volume, the amount directly traceable to the Government financing was relatively limited, and the whole increase was small compared with the total amount of the financing. The second Liberty loan at 4 per cent was offered on November 15. The quota for this district was fixed at a minimum of $120,000,000 and a maximum of $200,000,000. The amount subscribed for was $201,212,500 and the allotments $182,581,700. Payments required were 2 per cent with subscriptions and 18 per cent on November 15; 40 per cent on December 15; 40 per cent on January 15. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

392 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. The bank's ownership of Treasury certificates and Government bonds on December 31 amounted to $3,205,450, and operations in these securities are fully set forth in the following table: Open-market operations. Operations for the vear 1917. Balance Balance Securities. Dec.31,1916. Dec.31,1917. Purchases, Sales. Liberty Loans: 3i per cent $183,800 $140,900 $42,900 4 per cent (^second) 1,698,950 1,657,500 41,450 Certificates of indebtedness: 2 per cent 2,000,000 2,000,000 3 per eent : 259,000 259,000 One-year Treasury notes, 3 per cent SI, 070,000 1899,000 1,969,000 United Stated conversion bonds, 3 per cent i 900,100 900,100 United States consuls, 2 per cent 1,392,450 521,750 i 999,100 915,100 United States Panamas, 2 per cent 803,000 237,000 1800,000 237,000 Total.. 3,262,450 6,699,600 6,756,600 3,205,450 1 Conversions. In addition to this, the bank held on December 31 member bank collateral notes to the amount of $4,170,060 and notes of other parties indorsed by member banks to the amount of $5,294,639, all of which were secured by United States bonds and certificates of indebtedness. Our fiscal agency department having charge of the conduct of Liberty loan operations has required the supervision of several of our officers and heads of our departments. Twenty additional employees have been permanently engaged in this work, and 27 more added to the general force. In addition to this, at the height of the campaign many others were temporarily employed. Two of the large audit companies of the city also loaned us many of their expert accountants. The entire expenditure reported for reimbursement in connection with the campaign in the first Liberty loan was $23,700, the entire amount having been reimbursed to us by the Treasury Department. The total expenditure estimated in connection with the campaign in the second Liberty loan is about $60,000, some bills not having yet been put into final shape. None of this has yet been reimbursed to us by the Treasury Department. The amount of member banks collateral notes and notes of other parties indorsed by member banks and secured by United States bonds and certificates of indebtedness reached nearly $9,500,000 on December 31. This indicates the growing extent to which the bank has been called on to extend assistance up to this date in financing bond subscriptions. The natural inference is that as the final payments become due on the last subscriptions and further anticipated issues are offered to the public, the bank will continue to play an increasingly important part in the loans. Increased efforts will con- Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTEICT NO. 5 RICHMOND. 393 tinue to be necessary to distribute bonds among private investors in order that excessive demand upon the resources of the bank and its members may be minimized as far as possible, and interference with the process of supplying the regular demands through commercial channels be avoided. BANK ACTIVITIES DURING THE YEAR. The increase in member banks' deposits (reserves) from $25,000,000 to $45,000,000, partly due to a change in the law affecting reserve requirements and partly to the expansion of members' own deposits, coupled with the growth in loans and bills purchased from $7,000,000 to over $42,000,000, are striking illustrations of the growth of wealth and the volume of business within the district. Our loans have been confined entirely to the district except a purchase of $5,000,000 short-time bankers' acceptances from one of the other Federal Eeserve Banks. The increase of something over $300,000 in capital stock is due chiefly to subscriptions from important State banks and trust companies which have recently joined the system, and to substantial additions to surplus of several member banks. The following comparative balance sheet of the bank, as of December 31, 1916 and 1917, shows a growth of nearly $100,000,000 in its resources between the dates mentioned: Comparative balance sheets (condensed). Dec. 31, 1917. Dec. 31, 1916. ASSESTS. Cash: Gold reserve 562,342,094.05 $24,532,111.00 Legal tender, silver, etc 164,264.85 64,938.40 Total reserve 62,506,359.50 24,597,049.40 Other cash and cash items. 597,613.72 1,708,107.87 Total cash $63,103,973.22 $26,305,157.27 Depository banks (see contra-U. S. Treasurer special) 24,424,683.36 Transit items (deferred— net) 2,395,561.04 179,491.01 P O r v o e d r u d c ra ti f v ts e assets: 50,074.18 5,078.43 Loans and bills purchased 42,812,846.02" 7,213,968.08 Municipal warrants 60,750.00 United States securities "3* 205* 450." 00 3,262,450.00 Par values 46,018,298.02 10,537,168.08 Deduct: Reserve for depreciation $50,000.00 Unearned discount, etc 100,204.38 150,204.38 20,310.96 45,868,091.64 10,516,857.12 Add accrued interest receivable 21,575.24 4,033.20 Liquid values , 45,889,666.88 10,520,830.32 Real estate, furniture, and equipment , 309,065.24 133,475.77 Deferred charges 43,221.74 14,034.57 352,286. 98 147,510.34 136,216,245.66 37,158.127, 40 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

394 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. Comparative balance sheets {condensed)—Continued. Dec. 31, 1917. Dec. 31,1916. LIABILITIES. Deposits: United States Government $2,253,761.15 S3,059,731.73 Members... . . 45,356,855.67 25,450,515.49 Cashier's checks, etc .. . 192,256.97 2, 718.22 147,802,873. 79 528,512,965.44 United States Treasury, special (see, contra, depositary banks) 24,424,683.36 Other Federal Reserve Banks (net) 3,644,461.78 1,457,347.26 Federal Reserve notes outstanding (net) 56,563,805.00 3,830,000.00 Liability to shareholders: Capital stock. 3,663,950.00 3,346,150.00 Surplus 116,471.73 Undivided profits 11,664. 70 3,780,421.73 3,357,814.70 136,216,245.66 37,158,127.40 The expense account of the bank is set forth in the following table: Comparative expense accounts {exclusive of transit expense). 1917 1916 Current: Federal Advisory Council $431.60 $150.00 Assessment Federal Reserve Board expense. 14,255.60 11,743.48 Directors— Fees 3,020.00 3,760.00 Per diem allowances 1,230.00 1,840.00 Traveling expense 1,806. 49 2,505.38 Legal , 500.00 1,425.00 Salaries- Officers 33,199.96 31,427.97 Clerical staff 35,303.55 26,789.12 Watchmen 700.00 648.33 Miscellaneous 1,882.23 1,774.23 Traveling 668.67 406. 93 Conferences— Governors 336. 78 1,444.78 Federal Reserve agents i 68.37 2 320.89 Telephone 685.33 391.31 Telegraph 657.22 225. 79 5,209.57 3,408. 91 Expressage 4,115. 55 779.71 Rent (including outside vaults). 5,807.00 6,034.00 Taxes and fire insurance 2,629.24 Fidelity insurance 2,202.16 1,498.85 Light, heat, and power 820.14 901.11 Printing and stationery 9,723.02 3,576.79 Repairs and alterations 11,295.63 44.78 Miscellaneous 4,683.25 3,160. 58 Total current 141,094.62 104,257.94 Cost of Federal Reserve notes 62,529.60 18,247.82 Depreciation of building and equipment., 54,16145 713. 95 Total.. 257,785.67 126,219.71 i Credit. 2 Debit. While expenses show large increases, gross earnings for the year show an increase from $312,000 to $770,000, productive assets from $10,500,000 to $46,000,000, and net earnings from $186,000 to $462,000. The current expense increases are only moderate when the increased volume of business is taken into consideration. The major increases were for repairs and alterations of $11,000 to the building purchased for the use of our Baltimore branch, to be opened early Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. -BICHMOND. 395 in 1918. Federal Reserve notes outstanding have increased during the year from $20,000,000 to $60,000,000, and the increased cost is $44,000. Depreciation on building and equipment for the year of $54,000 represents depreciation in the property purchased for our proposed new building facing Capitol Square, the old buildings on the property having been removed. It also includes equipment (adding and printing machines, typewriters, etc.), and a portion of the cost of a new vault of moderate size in our present quarters. The removal of this vault to the new building when erected is contemplated. The details of comparative profit and loss accounts for this and the previous year are shown in the following tables: Comparative profit and Joss accounts, dividends, and undivided profits. 1917 1916 Gross earnings: On loans and investments . $716,340.78 $286,697.84 Profits on United States securities sold 16,711.75 12,527.84 Service charges (net over transit expense) 4,386.69 1,033.17 Penalties for deficiencies in reserve 31,362.02 12,390.39 Miscellaneous 1,207.69 142.25 $770,008.93 $312,791.49 Deduct— Expenses 257,785.67 126,219.71 Reserve for depreciation 50,000.00 307,785.67 126,219.71 Net profit for the vear 462,223.26 186,571.78 Balance in undivided profits Jan. 1 11,664.70 23,015.26 473,887.96 209,587.04 Dividends paid: 1 per cent—Nov. 16,1914, to Dec. 31,1915 30,387.65 6 per cent—Jan. 1, 1916, to Oct. 31, 1916 167,534.69 6 per cent—Nov. 1, 1916, to June 30, 1917 135,690. 71 6 per cent—July 1, 1917, to Dec. 31, 1917 105,253. 79 240,944. 50 197,922.34 Balance 232,943. 46 11,664. 70 Deduct— Franchise tax paid to United States G overnment 116 471. 73 Carried to surplus account 116,471. 73 232,943.46 Balance of undivided profits, Dec. 31 11,664. 70 This indicates that after charging off liberally on our building site, equipment, etc., paying dividends to our members in full at 6 per cent to December 31, and laying aside a reserve for depreciation, there remained $232,943 of undivided profits. The Federal Reserve Act provides that, after the payment of expenses and dividends in full to date, all remaining earnings shall be paid to the United States as a franchise tax, except that one-half of such earnings shall be paid into a surplus fund until it amounts to 40 per cent of the paid-in capital stock of the bank. Under this provision of the law one-half of the above earnings—$116,471—has been carried to surplus account and the other half paid to the United States Government as a franchise tax. Digitized for FRASE34R3 65°—18 26 http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

396 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. The following table giving the daily averages of member banks' deposits and of United States Government deposits for 1916-17 will be of interest and give evidence of the growth of banking resources in the district: Deposits—Daily averages by months; 1917 compared with 1916. Member banks. United Statc-3Government. Month. 1917 1916 1917 1916 January $$2266,,002233,,616.67 $11,199,805.77 $1,940,979.43 So, 658,432.64 February 25,719,944.94 11,483,882.66 1 460,930.46 6,328,866. 43 March 26,255,281.88 11,545,076.04 4,086,850.04 6,420,260.32 April 25,649,251.37 11,536,144.10 1,188,082.41 6,875,443.03 May 25,600,111.52 13,249,437.88 3,468,857.52 6,346,514.23 June , 28,290,347.84 14,901.902.86 7,979,110.88 7,191,234.53 July 33,950,883.34 15,956,127.43 10 375.597.34 0,671,597.44 August 37,060,405.42 16,330.973.91 5,148,718.32 3,320,534.36 September. 36,922,969. 42 16,615,271.11 3,310,445.18 2,988, 816. 83 October 40,217,988.13 20,013,963.91 3,466,750.03 3,594,049. Dl November 42,282,302.89 23,466,288.63 11,646,835.94 2,921,533.37 December 43,673,086.54 25,486,796.81 11 607,529.73 2.845,368. 45 Year 31,704,938.90 15 999,616.04 5,524,462.85 5,014,378.72 This growth of business is further illustrated by the following table showing the volume of discounts of over $100,000,000 during the current six months. Bankers' acceptances to the amount of $58,- 000,000 were purchased in addition to these discounts. Discounts during the year 1917. Maturities as of date of acquisition. 15 days and 16 to 30 31 to 60 61 to 90 Over 90 Total. less. days. days. days. days. Notes $104,652,137.05 $8,233,035.22 $16,006,334.97 $19,162,471.99 $1,295,537.41 $149,349,516.64 Member banks' collateral notes.. 245,024,635.04 245,024,635.04 Trade acceptances. 108,166. 29 '*4i7,'566.99""i,"229,"72L65""i," 405," 666." 35* 3,160,449. 28 Commodity paper. 546,212.04 1,019,084.71 1,437,422.62 683,365.71 3,686,085.08 Bill of lading drafts 1,747,294.11 1,747,294.11 Total 352,078,444.53 9,669,680.92 18,673,479.24 21,250,838.05 1,295,537.41 402,967,980.15 Of this total over one-half is represented by member banks' collateral notes having less than 15 days to run. This illustrates the importance of the facilities extended member banks for short loans. The handling of large transactions, necessitating frequently the temporary use of large sums, is economically facilitated by means of these short loans. The moderate rates at which these large transactions have been handled are set forth in the following table and are a further illustration of the liberal facilities extended to members bv the bank. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTKICT NO. 5 RICHMOND. 397 Discount rates current for the year 1911. Effective Jan. 1, 1917, un- Effective Effective Effective Effective Classification. changed Apr. 23, Mav 25, Nov. 5, Nov. 30, since 1917. 1917. 1917. 1917. Oct. 1, 1916. Member banks' collateral notes: Secured by customers' notes il Secured by United States securities Commercial paper: 15 days or less oh 16 to 90 days 4 4 Agricultural and live stock paper: 15 days or less 3-1 34 4 16 to 90 days 4 4 91 days to 6 months 4* Notes secured by United States securities-: 15 days or less 3i 3 V 16 to 90 days 3£ 3} Commodity paper: 15 days or less 3-1 31 16 to 90 days 3i 4 Trade acceptances: 60 days or less 3} 3t 61 days to 90 days 3j The following table shows the productive assets acquired during the year, analyzed as to class and rates. The amount of discounts held under each rate is shown with the average number of days each amount has to run. The total of $42,800,000 has an average of only 23 days to run, which gives a forcible illustration of the very liquid condition in which the bills of the bank are kept. Productive assets acquired during the year 1917, classified as to rates. 2 per cent. 3 per cent. Zl per cent. 31 per cent. 3* per cent. 3| per cent. United States Government securities $2,768,750.00 $259,000.00 $638,800.00 Warrants 115,000.00 Bankers' acceptances. 30,492,613.73$2,078,049.37S3,456,933.96 SI, 537,878.97 18,698,692.81 Commodity paper 3,566,960.08 Trade acceptances 2,492,327.34 Bill of lading drafts 755,058.48 Unsecured notes 10,543,950.43 Notes secured by: Merchandise 2,500.00 United States securities 24,049,078.01 Member bank collateral notes secured by: United States securities 30,313,922.05 disjoin fiT"f>' TI nfps 206,108,999.99 Total 2,768,750.0030,751,613.73 2,078,049.37 3,456,933.96 1,537,878.97 297,2So, 289.79 Owned Dec. 31,1917: United States Government securities 1,152,100.00 1,969,000.00 42,900.00 Loans and bills 1,332,840.58 100,000.00 590,521.36 18,248,155.93 Average unexpired term in days 26 36 21 23 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

398 ANNUAL REPORT OF THE FEDEBAL RESERVE BOARD. Productive assets acquitcd during the year 1911, classified as to rates—Continued. 3| per cent. 3* per cent. 4 per cent. 4$ per cent. Total. United States Government securities $2 305,950.00 $5,962,500.00 Warrants 115,000.00 Bankers' acceptances $454,510.27 $1,397,380.87 58,116,059.98 Commodity paper ii9,"i25*66 3,686,085.08 Trade acceptances 668,121.94 3,160,449.28 Bill of lading drafts 992,235.63 1,747,294.11 Unsecured notes 1 - - - - - - 106,434,776.64 $5,836,430.80 122,815,157.87 Notes secured by: Agricultural products 275,461.58 299,847.16 575,308.74 Live stock 6,980.89 6,980.89 Merchandise 10,000.00 12,500.00 United States securities 1 890,490.53 25,939,569.14 Member bank collateral notes secured by: United States securities 30,313,922.05 Customers' notes 8,601,713.00 214,710,712.99 Total 454,510.27 1,397,380.87 121,304,855.21 6,136,277.96 467,161,540.13 Owned Dec. 31,1917: United States Government securities 41,450.00 3,205,450.00 Loans and bills 191,727.05 1,397,380.87 16,575,520.39 4,370,699.84 42,812,846.02 Average unexpired term in days 17 61 13 39 23 The volume of paper handled is almost wholly determined by the terms of the paper, whether of short or long maturities, and the following table will show7 daily averages of outstanding bills for the entire year, and will indicate the average continuous service rendered. Daily averages of productive assets for the year 1917. Bankers' acceptances. Member Classification. Commodity. acc T ep ra ta d n e ces. co b ll a a n te k ral Foreign. Domestic. notes. United States securities $608,293.24 Agricultural products $402,623.93 $8,521.18 Live stock Merchandise 2,248,983.37 Nonmember bank Total collateral 402,623.93 8,521.18 2,857,276.61 Unsecured 406,737.89 $5,017,198.22 $1,218,258.46 Total loans 402,623.93 415,259.07 5,017,198.22 1,218,258.46 2,857,276.61 Warrants United States bonds Grand total 402,623.93 415,259.07 5,017,198.22 1,218,258.46 2,857,276.61 Held by United States Classification. Notes. bonds and Combined Federal investments. Reserve Bank. agent. United States securities 1538,928.86 $1,147,222.10 $1,147, 222.10 Agricultural products 71,658.56 482,803.67 432,645.09 $50,158.58 Live stock 1,306.17 1,306.17 1,249.73 56.44 Merchandise • ....... 2,732.90 2,732.90 2,595.90 137.00 2,248,983.37 1,361,328.85 887,654.52 Nonmember bank 19,396.05 19,396.05 19,396.05 Total collateral 634,022.54 3,902,444.26 2,964,437.72 938,006.54 Unsecured 6,410,846.15 13,053,040.72 12,526,260.52 526,780.20 Total loans 7,044,868.69 16,955,484.98 15,490,698.24 1,464,786.74 W Un a i r t r e a d n t S s tates bonds " 3 " , " i 6 i5 7 , 2 * , 7 4 9 2 i 7 ." . 7 8 8 1 " 3.67 1 2 5 , , 4 7 2 9 7 1. . 7 8 8 1 3,67 1 2 5 , , 4 7 2 91 7 . . 7 8 8 1 Grand total 7,044, 868.69 3,688,219. 59 20,643,704.57 15,490,698.24 5,153,006.33 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. -RICHMOND. 399 The productive assets owned December 31, 1917, are again analyzed in the following table, which gives the volume of paper maturing within 15 days and later maturity periods, from which it will be seen that over $24,000,000 out of the total of $42,000,000 had less than 15 days to run at the close of business December 31. This gives another forcible illustration of the extreme liquidity of the larger portion of the bank's paper. Analysis of productive assets as of close of business Dee. 31, 1917. Bankers' acceptances. Commodity. acce T p r t a a d n e ces. Me c m ol b la e t r e r b a a l nk Foreign. Domestic. notes. CLASSIFICATION. Ignited States securities $4,171,060.00 Agricultural products... $97,400.00 Total collateral 97,400.00 4,171,060.00 Unsecured $1,057,053.93 $8,935,465. 95 $4,220,660.76 Total loans 97,400.00 1,057,053.93 8,935,465.95 4,220,660.76 4,171,060.00 Grand total 97,400. 00 1,057,053.93 8,935,465.95 4,220,660.76 4,171,060.00 MATURITIES. Within 15 days 15,150.00 231,346.50 1,812,773.36 1,186,947.43 4,171,060.00 16 to 30 days 41,500.00 260,327.35 4,104,215.69 554,686.00 31 to 60 days 40,750.00 437,722.37 1,728,437.26 1,689,568.21 60 to 90 days.. 127,657.71 1,290,039.64 789,459.12 Grand total 97,400.00 1,057,053.93 8,935,465.95 4,220,660.76 I 4,171,060.00 Notes. U in b n v o i e t n e s d d tm s S a e t n n a d t t s e . s Combined. Res F er e v d e e r a a g l ent. Bank. CLASSIFICATION. United States securities $5,294,639.88 $9,465,699. 8S $9,465,699. 88 Agricultural products 291,070.16 388,470.16 388,470.16 Bill of lading drafts 92,344.97 92,344.97 92,344.97 Nonmember bank 707,956.00 707,956.00 707,956.00 Total collateral 6,386,011.01 10,654,471.01 10,654,471.01 Unsecured.. 17,946,194.37 32,158,375.01 32,158,375.01 Total loans 24,331,205.38 42,812,846.02 42,812,846.02 United States bonds.. $3," 205,450.'66 3,205,450.00 $3,205,450.00 Grand total 24,331,205.38 3,205,450.00 46,018,296.02 42,812,846.02 3,205,450.00 MATURITIES. Within 15 days 16,967,056.89 24,384,334.18 24,384,334.18 16 to 30 days 1,244,820.00 6,205,549.04 6,205,549.04 31 to 60 days 4,965,373.47 8,861,851.31 8,861,851.31 60 to 90 days 1,141,207.52 3,348,363.99 3,348,363.99 Over 80 days 12, 747. 50 3,205,450.00 3,218,197.50 12,747.50 3,205,450.00 Grand total 24,331,205.38 3,205,450.00 46,018,296.02 42,812,846.02 3,205,450.00 The following table compiled by quarters gives the volume of paper in pieces and by amount, the daily average, the annual rate earned, the amount of discount earned during each period, and the rebates on anticipated payments with the resulting earnings. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

400 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD, Productive assets icitli earnings and averages, 1917. Volume of investment Daily averages, holdings. Annual operations. rate Days income Quarterly periods, 1917. in on period. Items. Amount. Items. Balances current. earned tual). Jan 1 to Mar. 31. 3,345 $33, 679, 716.17 37 $11,818,978.88 90 3.28 Apr. 1 to June 30.. 7,236 81,446,432.97 80 19,117,894.00 91 3.17 July 1 to Sept 30 7,990 123,044, 054. 72 87 21,289,594.24 92 3.54 Oct. 1 to Dec. 31 5,215 228,991,336.27 56 30,139, 924.38 92 3. 63 Total 23, 786 467,161,540.13 65 20,643,704.57 365 3.47 Discount and interest. Sundry profits. Total Quarter 1 l 9 y 1 7 p . eriods, ( E ac a t r u n a e l d ). ch M m a u i r n g m i e - s. t t i i A c o i n n p - s a . - Total. P s U r S o a n t l f e a i i t s t t s e e o s d o f n d P e e fi n c f i o a n ie r l n ti c e y s l M an i e s o ce u l s - . p e ro a a s r d s n o u e i f c n ts t g ! . s VQ securities. reserve. Jan. 1 to Mar. 31.... $94,675.06 5.56 95.33 $94,775.95 $16,711.75 $5,982.70 $58.18 $117, 523.58 Apr. 1 to June 30 153,075.82 9.72 104. 62 153,190.16 5, 793.43 138. 96 159,122. 55 July 1 to Sept. 30.... 191,954.81 8.71 203.00 192,166. 52 8,153.79 415. 81 200, 736.12 Oct. 1 to Dec. 31 275,879.68 4.11 324.36 276,208.15 11, 432.10 594.74 288, 234. 99 Total 715, 585.37 28.10 727.31 716,340.78 16,711.75 31,362.02 1,207.69 765, 622.24 This includes penalties which we are compelled under the law to charge members for deficiencies in reserve, and we would urge members to give this matter careful consideration. Demands for funds can be much more economically met by rediscounting at our moderate current rates than by impairing reserves, thus creating deficiencies on which we are required to charge 2 per cent above the current rate for 90-day paper, but not less than 6 per cent per annum. The productive assets are again analyzed by quarters in the following table, giving distribution by States, and showing the number of banks in each State accommodated at each different period. Productive assets acquired—Distribution by States, 1917, Jan. 1 to Mar. 31. Apr. 1 to June 30. July 1 to Sept. 30. Banks. Amount. Banks. Amount. Banks. Amount. Marvlsiid. 12 $9,080,017.27 17 $21,525,542.79 17 $23,307,621.93 District of Columbia 3 648,951.65 4 701,954.17 4 1,116,057.16 Virginia 20 11,099,707.69 44 45,146,407.24 48 81,967,017.92 West Virginia 1 3,900.50 10,200.00 3 267,148.31 North Carolina 30 5,160,343.11 48 7,122,200.02 49 8,152, 249.12 South Carolina 42 4,913,046.45 54 6,681,128. 75 56 7, 629, 760. 23 Other Federal Reserve Banks. Discounts and bills purchased. 30,905,966.17 81,187,432.97 122, 439, 854. 72 Warrants purchased.. . 15,000.00 100,000.00 United States securities purchased 2,758,750.00 259,000.00 504,200.00 Total 108 33,679, 716.17 168 81,446,432.97 177 123,044,054.72 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 5 RICHMOND. 401 Productive assets acquired—Distribution l)y States, 1917—Continued. Oct.1 to Dec. 31. Total period. Balance as of Dec. 31. Banks. Amount. Banks. Amount. Maryland 31 $22,837,696.57 32 $76, 750,878.58 $10,239,075.93 District of Columbia 6 1,035,131.91 7 3, 502,094.89 437,412.53 Virginia... 54 151,464.357.05 71 289,677, 489.90 18,649,937.43 West Virginia 9 1,533,686.70 11 1,814,935.01 549,350.64 North Carolina 37 13,057,207.44 59 33,491,999.69 6,172,265.08 South Carolina 29 31,604,760.02 65 50,828,695.50 4,505,727.36 Other Federal Reserve Banks 1 5,017,946.58 1 5,017,946.58 2,259,077.00 Discounts and bills purchased. 226,550,786.27 461,084,040.13 42,812.846.02 Warrants purchased 115,000.00 United States securities purchased 2,440, 550.00 5,962,500.00 3,205.450.00 Total 187 228.991,336.27 246 467,161,540.13 46,018,296.02 Virginia shows the largest volume of bills discounted, this being partly due to the fact that our members in Richmond have found it convenient to avail of, to a large extent, frequent leans running from 1 to 15 days. The following table on clearing operations gives full details as to number of items, amounts, averages, and costs: Clearing operations for the year. Daily averages, 304 business days. Average Equivalent cost per o N f u i m tem be s r . Amount. N be u r m o - f Amount. a i m t p e o e m u r n . t $ i c c 1 e e , n 0 t 0 c s 0 h p , a w e rg r i e t i h t e a s m t e r . 1 v J items. Government cheques 81,040 $24,119,000 266 $79,339 $298 No charge made. Through Richmond Clearing House 339,677 882,652,100 1,117 2,903,461 2,598 " Do. Total free 420,717 906,771,100 1,383 2,982,800 2,157 On other points in district No.5 4,726,700 1,439,595,700 15,548 4,735,512 305 4 11/100 cents. On points in other Federal Reserve districts 540,863 1,057,582,700 1,780 3,478,890 1,955 64/100 cents. Total service 5,267,563 2,497,178,400 17,328 8,214,402 474 2 64/100 cents. Grand total 5,688,280 3,403,949,500 18,711 11,197,202 599 2 09/100 cents on grand total. Disbursements for transit department, $51,186.57. Cost per item on total handled, 0.90 cent. Cost per item subject to service charge, 0.97 cent. Cost per $1,000 on total handled, 1.50 cents. Cost per $1,000 subject to service charge, 2.04 cents. Service charge per item, 1.25 cents. This volume of business is constantly increasing, and as our members are becoming more familiar with our methods, we anticipate increasingly extensive use of the facilities which wTe offer them. FEDERAL RESERVE BANK AND MEMBER BANKS. The following table analyzing capital stock for the year gives comparison with December 31, 1916, showing additions and reduc- Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

402 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. tions in the number of banks by States, with a resulting membership of 530 as against 520 at the close of 1916, and an increase of capital from $3,346,150 to $3,663,950: Capital stock—Analysis for the year 1917. Mary- District West North South land. of Co- Virginia. Vir- Caro- Caro- Total. lumbia. ginia. lina. lina. Balance Dec. 31,1916 96J16,065 158,09814519,055104 8,463 81 7,57079 7,672520 66,923 Additional allotments on increases of capital or surplus of members 1,029 26 1,506 233 391 227 3,413 96J17,094 15 8,124145 20,561104 8,696 817,961 79 7,899 52070,336 Reductions on decreased capital or surplus of members 30 126 29 185 9617,094 1518,124145 20,561104 8,666 7,835 797,870520 70,151 Additions to memberships during the year 2,160 1,152 87 21 130 18' 3,549 98 19,254 15js, 124 153 21,713 106 8,75382 7,856 84 8,000 538 73,700 Liquidations during the year., 20 213 151 15 2~2~ ~ 421 Balance Dec. 31,1917.... 19,234 15 8,124 151121,500 103 8,60281 7,841 7,978 53073,279 The number of national bank and State bank stockholders, distributed by States, the amount of stock held in each State, and the dividends paid thereon are shown in the following table: Capital stock and dividends. Number of members. 6 per ce p n a t id d . ividends 50 per cent Shares of par of allotted. allot- From Nov. From tio N n a a - l. State. Total. m pa e i n d t . s 1 J , u 1 n 9 e 1 6 3 , 0 t , o J D ul e y c . 1 3 t 1 o , 1917. 1917. Maryland 95 2 97 19,234 961,700 33,203.95 26,529.13 District of Columbia 14 1 15 8,124 406,200 16,224.38 12,180.00 Virginia • 147 4 151 21,500 1,075,000 38, 772. 56 30,521.15 ^rest Virginia 102 1 103 8,602 430,100 16,921.05 12,728.44 North Carolina 81 81 7 841 392 050 15 210.44 11,537.91 South Carolina 78 5 83 7,978 398,900 15,358. 33 11,751.16 Total 517 13 530 73,279 3,663,950 135,690. 71 105,253.79 The amendment to the Federal Keserve Act passed in June reduced the reserves required to be carried by member banks to 7 per cent against demand deposits and 3 per cent against savings accounts, 10 per cent being required in reserve cities against demand deposits, but all of these reserves are required to be carried with the Federal Reserve Bank. Banks are not now being required to carry reserves in their own vaults, but are left free to use their own judgment as to the amount of their cash needs at home and the character of Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 5—RICHMOND. 403 them. Under these conditions, Federal Reserve notes are available instead of legal tender and gold certificates. Member banks and many State banking institutions have freely sent in gold and gold certificates, which has caused a largely increased demand for the use of Federal Reserve notes, and the amount of such notes outstanding increased during the year about $40,000,000. Relations with member banks have been cordial, and during the eventful year we have had their loyal support and cooperation. The effectiveness of the system and the impracticability of doing without it are universally recognized. It remains only to bring about the final establishment of a universal par collection plan (which will remove the necessity for balances at central points for the purpose of clearing the numerous State bank items) to round out the system to the complete satisfaction of all members. The discount facilities offered by the bank, and the established fact that these can be relied upon with assurance, have been a general source of confidence to the officers of our member banks, in regard to which we are constantly receiving gratifying expressions. While the present unusual and in some respects trying conditions ft re fully recognized, the bygone doubts of the adequacy of our banking facilities have been replaced by a feeling of confidence. We are glad to express the belief also that there are few cases in which there is any marked disposition to overtrade; the character of loans is becoming more varied, better scattered, and therefore more liquid. Cooperation in the securing of credit statements is increasing, the necessity for and advantage of obtaining them being more fully recognized both by the banks and their borrowers. The irregularity in mails, we regret to report, is more frequent, due to inadequate postal facilities, aggravated by congested traffic conditions on the railroads. These facilities, which appear to have been inadequate in normal times, have been swamped under existing war conditions. During the year the following banks have been authorized to act as trustee, executor, administrator, and registrar of stocks and bonds: First National Bank, Hyattsville, Md.; National Bank of Rising Sun, Rising Sun, Md.; First National Bank, Appalachia, Va.; First National Bank, Danville, Va.; Union National Bank, Clarksburg, W. Va.; National Bank of New Bern, New Bern, N. C. FEDERAL RESERVE BANK AND STATE BANKS AND TRUST COMPANIES. On January 1, 1917, we had six State bank members, with aggregate resources of $7,800,000. The general attitude of State bank officers has apparently been more friendly than heretofore, evidenced chiefly by a frank admis- Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

404 ANNUAL BEPOBT OF THE FEDERAL RESERVE BOARD. sion, almost universally, that the Federal Reserve System has been the salvation of the country—agriculturally, commercially, and financially—and that the State banks indirectly have been the beneficiaries in this to the same extent practically that members of the system have shared in it. They say frankly they would be unwilling to see former conditions restored. Financially, their attitude is that while they might be willing to come in as members, notwithstanding some loss of interest which they now get on balances, they are unwilling to forego the present returns from exchange charges. They are satisfied to enjoy the stability and prosperity and the profits arising from such conditions, due to the operation of the Federal Reserve System, but want to retain every source of profit which existed under the old system. They admit they want their items cleared at par. They are carrying at central points for this purpose considerable balances on which they are receiving a low rate of interest, whereas, these balances could be more profitably employed in regular loans, provided they could clear all items at par through the Federal Reserve Bank. Many express a willingness to become members " if all the others would come in," thus establishing a universal par clearing plan, but each one hesitates about being the first and alone in going " over the top." Notwithstanding this, we have received during the year applications from nine State banks and trust companies, of which seven were admitted up to December 31, their resources aggregating over $27,000,000. We have had many inquiries as to membership, have sent out considerable literature on the subject and had lengthy personal discussions and correspondence. We have the assurance of several additional applications, and are discussing membership with others, who have the matter under consideration. In this connection, with the approval of the Federal Reserve Board, our board has authorized the report of examinations of the State banking departments in this district to be accepted, in connection with the application of State banks and trust companies for membership. Some institutions which desire to join are conducting lines of business which are not regarded as altogether desirable in association with regular banking, and action as to membership hinges upon the possibility of elimination of these lines. While the movement for membership is not in such volume as is desirable, the interest in the question of membership is gratifying and encouraging. With reference to the admission of a State bank as a member of the Federal Reserve system, the Federal Reserve Act provides that— No applying bank shall be admitted to membership in a Federal Reserve Bank unless it possesses a paid-up unimpaired capital sufficient to entitle it to become a national banking association in the place where it is situated, under the provisions of the national banking act. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 5-—RICHMOND. 405 The limit of minimum capital is fixed by the national banking act as follows: In cities or towns not exceeding 3,000 inhabitants, $25,000. In cities or towns exceeding 3,000, but not exceeding 6,000 inhabitants, $50,000. In cities or towns exceeding 6,000, but not exceeding 50,000 inhabitants, $100,000. In cities exceeding 50,000 inhabitants, $200,000. Out of approximately 1,500 State banks and trust companies located in the fifth district about 500 are eligible to membership under this provision of the act. Of the remaining banks about 200 are sufficiently wTell provided with surplus to enable them to qualify; under the capital-stock requirement without the contribution of additional capital by stockholders by the simple expedient of transferring a certain amount from surplus fund to capital stock. We can see, therefore, that out of the 1,500 State institutions in this district approximately one-half are qualified or could easily qualify for membership in the system. While a number of the larger and more substantial State institutions have been admitted to membership, or have applications pending, quite a large number of qualified institutions (or institutions which could qualify) have not clone so. A number of these institutions, as well as a number of State banks that are unable to meet the capital requirements requisite for membership, have cooperated with the Federal Eeserve system, at least as far as the collection system is concerned, but they are not cooperating in such a way as to strengthen the resources and increase the lending power of the system, as they would by participation as full members of the system. Since many of these institutions are depending upon (member bank) correspondents with whom balances are carried by them, for a large part if not all, of the accommodation which they require, and since these correspondents are in many cases borrowing more largely from the Federal Eeserve Bank than they would be required to borrow, were it not for this dependence, the nonmember State institutions are really occupying the position of liabilities rather than assets of the Federal Eeserve system. By becoming members of the system they would, through their capital subscriptions and reserve deposits, increase the resources of the Federal Eeserve Bank, and add to its strength and lending power. By remaining out of the system they constitute an element of weakness in our financial structure instead of adding to its strength. FEDERAL RESERVE BANK AND THE PUBLIC. Our relations with the public through member banks and by direct contact have been cordial, and on every hand we hear universal expression that the Federal Eeserve system has been a balance wheel Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

406 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. which has stabilized and aided agricultural and commercial developments and aided in bringing unmeasured prosperity to the district. The Government and its representatives have the cordial support and cooperation of every interest in the district, with an increasing resolution to carry our participation to a successful conclusion in behalf of world-wide freedom. FEDERAL RESERVE BANK AND NOTE ISSUES. The following table gives the interdistrict movement of Federal Reserve notes for the year, indicating the extent to which these notes travel abroad throughout the country as illustrated by the amounts and the district from which they are returned for redemption. Interdistrict movement in Federal Reserve notes for tlie year ended Dec. 31, 1917. Frves. Tens. Twenties. Federal Reserve Bank of— Received Returned Received Returned Received Returned from. to. from. to. from. to. Boston $55 920 $12,250 $82,350 $32,070 $98,080 $3 980 New York 1,042,325 197,750 1,155,130 345,260 1,071,000 263,240 Philadelphia 185,505 65,500 247,000 130,640 280,500 126,780 Cleveland 16.810 16, 750 29,680 36,910 45,660 77 640 Atlanta 264,500 94,750 304,000 100,450 265,500 67,820 Chicago 72 500 4,950 98,000 22 230 106 000 30 980 St. Louis 28,100 6,150 41,400 14,000 44,380 13,000 Minneapolis 3,610 5,250 4,810 26,490 7,080 12,000 Kansas City 4,450 8,750 6,990 11,990 5,700 12,000 Dallas 58,580 6,500 14,910 13,680 12,940 12,920 San Francisco 2,695 2,610 111,200 1,890 61,620 7,500 Total 1,734,995 421,210 2,095,470 735,610 1,998,460 627,860 Fifties. Hundreds. Total. Federal Reserve Bank of— Received Returned Received Returned Received Returned from. to. from. to. from. to. Boston $19,750 $1,200 $7,800 $1,000 $263,900 $50 500 New York 213,450 28,350 198,400 158,500 3,680,305 993,100 Philadelphia .. 57,500 11,150 27,500 2,600 798,005 336,670 Cleveland 8,350 11,400 600 2,500 101,100 145,200 Atlanta 20 350 2,500 8,100 3 000 862 450 268 520 Chicago 29,600 13,050 5,900 57,400 312,000 128,610 St Louis 6,600 1,000 1,600 100 122,080 34,250 Minneapolis.... 1,400 350 100 300 17 000 44 390 Kansas City 1,250 1,400 600 100 18,990 34,240 Dallas 1,900 650 1,000 89,330 33,750 San Francisco 6,500 1,300 3,000 900 185,015 14,200 Total 366,650 72,350 254,600 226,400 6,450,175 2,083,430 The following table gives the denominations and aggregate amounts of Federal Eeserve notes received since the organization of the bank, the amounts on hand, and the aggregate amounts returned to the Comptroller of the Currency for destruction. Over $60,000,000 was in the hands of the public at the close of the year, as compared with Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. -RICHMOND. 407 $20,000,000 outstanding December 31, 1916. In accordance with a suggestion from the Federal Eeserve Board, this bank has authorized the maintaining of a reserve supply of unissued Federal Reserve notes at a minimum of $40,000,000 and a maximum of $61,000,000. Number of Federal Reserve notes, by denominations and aggregate amounts, received, issued by the bank, and returned to the comptroller since organization and on hand at close of business Dec. 31, 1917. Number of notes. Aggregate Hun- amount. Fives. Tens. Twenties. Fifties. dreds. Received from comptroller 3,388,000 2,564,000 1,336,000 104,000 36,000 $78,100,0^0 Received from Federal Reserve Bank... 280,000 213,500 98,250 14,200 2,800 6,490,000 Received from Treasurer of United States (fit notes) 2,860 1,270 220 44 20 35,600 Received by comptroller from Treasurer of United States for destruction and credit of Federal Reserve agent's account (unfit notes): ' From other Federal Reserve Banks.. 16,100 7,000 2,475 200,000 Direct from reporting Federal Reserve Banks and from other sources 1,132,569 494,295 181,431 15,875 2,617 15,289,865 Total 4,819,529 3,280,065 1,618,376 134,119 41,437 100,115,465 Issued to Federal Reserve Bank 3,638,860 2,706,770 1,426,470 110,244 34,820 82,785,600 Returned to Comptroller of the Currency for destruction, including notes returned by United States Treasurer for credit of Federal Reserve agent's account 1,148,669 501,295 183,906 15,875 2,617 15,489,865 Notes on hand at end of month 32,000 72,000 8,000 8,000 4,000 1,840,000 Total 4,819,529 3,280,065 1,618,376 134,119 41,437 100,115,465 Actually destroyed, per "Washington certificates 1,140,917 496, 359J 182, 751 15,739 2,599 15,370,050 In hands of public (including Federal Reserve Banks) 2,215,083 1,995, 640* 1,145,249 80,261 29,401 60,889,950 In hands of Federal Reserve agent 32,000 72,000 8,000 8,000 4,000 1,840,000 Total received from comptroller... 3,388,000 2,564,000 1,336; 000 104,000 36,000 78,100,000 NOTE.—Present cost of Federal Reserve notes: Per M pieces. Per $1,000. At Washington $9.14 $0.87 Postage to Richmond .81 .08 Insurance.. .53 .05 Total... . 10.48 1.00 A supply of Federal Eeserve notes is maintained at the bank in the custody of the Federal Eeserve agent. These notes are shipped to him by the Federal Eeserve Board upon his request, are receipted for jointly by him and a representative of the bank, and are kept under the joint control of himself and the bank. Under this arrangement, they are always promptly available for use under the provisions of the Federal Eeserve act. Notes and bills discounted held by the Federal Eeserve agent as security for Federal Eeserve notes are indorsed by him 10 days in advance of maturity to the Federal Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

408 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. Eeserve Bank for collection for his account, and are accounted for to him by the bank as they mature. Federal Eeserve notes have been issued during the year in considerable amounts in exchange for gold, but chiefly for the use of member banks in exchange for notes and bills discounted for them. An increase of $4O OOO,OOO in the amount outstanding is tangible 3 evidence of the credit facilities extended to member banks, and through them to the business interests of the district. The abundant security for these Federal Eeserve notes placed by the bank in the hands of the Federal Eeserve agent (the representative of the Federal Eeserve Board) in the shape of notes discounted and gold, makes them absolutely good, to say nothing of the fact that the Federal Eeserve notes are the direct obligations of, the Government, The law provides that the amount of gold held as reserve for these notes shall be not less than 40 per cent, and the bank is always, therefore, in a position promptly to redeem its notes whenever they are presented. INTERNAL MANAGEMENT OF THE BANK, The growth in the transactions of the bank has necessitated during the year an increase in the number of officers, members of the staff, and other employees from 63 to 110, and even with this increase, it has been necessary for a large majority of the officers, staff, and force to work overtime. This has involved constant night work for weeks at a time. The service has been rendered cheerfully and ungrudgingly. The chief cause for this overtime work has been due to the difficulty of securing efficient help, which has been greatly in demand, this demand to a considerable extent being due to the draft to direct Government activities and indirectly to the large volume of business placed by the Government with large manufacturers and producers. Women are discharging a growing percentage of bank work, just as they are doing in many industrial lines, and lack of training has naturally had to be overcome. Of the entire bank force of 110, 49 are women. The difficulty of securing experienced men as heads of departments for the purpose of giving this necessary training has been a leading phase of the situation, but by earnest cooperation of all employed, the situation has been satisfactorily solved, and our force to-day is better rounded, better equipped, more efficient, and better qualified than ever before to discharge its duties and responsibilities. Some further adjustments are necessary, particularly with the view for providing the necessary force for opening our Baltimore branch early in the new year. At the beginning of the year Mr. James A. Moncure was reappointed class C director for a period of three years, and reappointed Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT K"0. 5—BICHMOKD. 409 deputy chairman and deputy Federal Reserve agent. In accordance with amendments to the Federal Reserve act passed in June, the office of deputy Federal Reserve agent was abolished and Mr. Moncure's appointment to this position terminated. He was reappointed OB July 25 deputy chairman for the remainder of the year. At the opening of the year. Mr. Caldwell Hardy was reappointed chairman of the board and Federal Reserve agent. The following officers were reelected for the year 1917: Mr. George J. Seay, governor; Mr. Charles A. Peple, deputy governor ; Mr. George II. Keesee, cashier and secretary of the board and executive committee. Mr. J. W. Norwood was reelected member of the Federal Advisory Council and attended meetings of the Federal Advisory Council held in February, April, September, and November. On May 17, the bank was designated as fiscal agent for the United States and the activities of the bank under this appointment are elsewhere reported. The establishment of a branch bank at Baltimore was authorized by our board after due consideration, and received the approval of the Federal Reserve Board. A committee, consisting of Messrs. Seay, Brtrton, and Hardy, was appointed by our board with authority to procure satisfactory banking quarters for the branch at Baltimore, and the building of the former National Mechanics Bank of Baltimore (which was consolidated with the Merchants National Bank) has been acquired for the Baltimore branch at a cost of $200,000. The necessary alterations and improvements are being made and it is anticipated that the branch will be opened early in the new year. Deputy Governor Peple and Auditor Cadwallader visited some months ago the Federal Reserve Bank of Atlanta and the New Orleans branch, with a view to studying the methods there in use and formulating plans for the organization of our proposed branch. In May, a plan for inter-reserve rediscoxinting was inaugurated by the Federal Reserve Banks, at the suggestion of the Federal Reserve Board. This was done with the view to mobilizing resources at the point of the greatest demand, through the cooperation of those of the Federal Reserve Banks having at the time the largest amount of available resources. Under this arrangement, our bank bought during the past few months from one of the other Federal Reserve Banks $5,000,000 of bankers' acceptances. In June Mr. Thomas Marshall, jr., and Mr. C. V. Blackburn were appointed assistant cashiers. Mr. Marshall has special charge of correspondence in regard to discounts, and Mr. Blackburn is in charge of our transit department. In July Mr. M. F. H. Gouverneur, class C director, resigned, owing to his removal from the district, creating a vacancy to be filled by appointment by the Federal Reserve Board. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

410 ANNUAL EEPOET OF THE FEDERAL RESERVE BOARD. BANK BUILDING. Our main quarters, at 1109 East Main Street, are inadequate and anything but modern. Although we are occupying five floors in the building, the extension of our activities under the appointment as fiscal agent for the United States Government necessitated our acquiring the street floor and basement of the adjoining building, 1107 East Main Street, in addition to which we have rented the main banking room of 1016 East Main Street, the building formerly occupied by the Richmond Banking & Trust Co. Our need for vault space increased to such an extent that we were unable to secure the necessary space among the other banks, to say nothing of the inconvenience and risk of transporting securities back and forth, and we recently had completed and installed a new and modern vault of moderate size in the fiscal agent department. This has proven of invaluable service and simplified to a marked degree our difficulties in this direction. The removal of this vault to our proposed new building at the corner of Ninth and Franklin Streets, facing Capitol Square, is contemplated. Having acquired last year the site referred to above, we proceeded early in the year with specifications for a competition for designs for the proposed new building, the competition being under the direction of Mr. Waddy B. Wood, of Washington, D. C. Eight architects, or firms, entered the competition and the designs were submitted in April. After a careful consideration of all plans by a jury of award, consisting of three of our officers and directors and two prominent architects, a design was selected which was made by Messrs. Sill, Buckler & Fenhagen of Baltimore, to whom was awarded a contract for the plans for the building. Messrs. Carneal & Johnston, with A. C. Bossom, of New York, associate, were awarded the second prize of $500, and Messrs. Parker, Thomas & Rice, of Baltimore, were awarded the third prize of $250. The plans were selected by the jury without knowledge as to the author. The architectural design for the building has been completed, the details of the interior have received much consideration and study and it is hoped to have the whole design completed at an early date. The functions of the bank are new and unusual, necessitating much study and consideration in arranging the interior details. Thomas Bruce Boyd (Inc.), engineers, of New York, have been engaged in conjunction with our architects on these details, and it is hoped to construct an attractive and monumental building, wTell adapted to the use of the bank. GENERAL. The activities of the Government in the district at Charleston, ,W. Va., Norfolk, Cape Henry, and the adja'cent waters in Virginia, Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 5 RICHMOND. 411 and Army and aviation camps at different points, have become an active factor and element in the development of the district. The expenditure of vast sums in connection with these developments has stimulated the demand for material and labor. The maintenance of them in the future will put in circulation in the district large sums for labor and supplies. Parties in this district desiring farm loans should apply to the Federal Land Bank at Baltimore if located in Virginia, West Virginia, Maryland, and the District of Columbia, and to the Federal Land Bank at Columbia if located in South Carolina and North Carolina. There has been but .one small and unimportant member bank failure in the district during the year. It is noted that some of our packing houses maintaining large distributing plants throughout the country, including this district, are arranging lines of credit with our member banks predicated ap-* parently upon balances carried with these member banks. This indicates a desire to finance in the district the approximate volume of their business therein. The pursuit of this method will distribute their financing more evenly throughout the country instead of its being concentrated at the location of their main office, and we regard it as a healthy sign. Earnings and expenses for the year have been satisfactory, as indicated by a payment to the Government of over $116,000—one-half of our undivided profits to date. This result was reached through the extension of liberal accommodation to our member banks at minimum prevailing rates. A moderate proportion of our loans to member banks have no doubt been due to Government financing, and the amount of this will no doubt be maintained and probably increased as other loans are issued. Even in the event, however, of peace and the curtailment or elimination of further Government financing, we anticipate that the normal business activities of the district will make a demand on us for loans, which will maintain our earning power on a satisfactory basis. The developments in the district have been highly satisfactory and the general outlook is favorable. 34365°—18 27 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 6—ATLANTA. M. B. WELLBORN, Chairman and Federal Reserve Agent. Substantial progress has been made during the year 1917, in broadening the activities of the Federal Reserve Bank of Atlanta proper, and in the extension and development of the fiscal agency department in its connection with Government financing. The resources of the institution have grown from $38,337,736.01 on December 30, 1916, to $121,798,371 on December 31, 1917; the bank has paid a full 6 per cent dividend to date; and in accordance with the act has paid to the United States 50 per cent of its net earnings, in amount, $40,000, as a franchise tax, the remainder being carried into a surplus fund. The member banks have more extensively availed themselves of the rediscounting privileges; the " rediscounts and paper bought " on hand December 31, 1917 being $21,020,900, as compared with $7,411,829.98 as of December 30, 1916. The increase in acceptances offered shows a better understanding«of the advantages of this class of paper. The institution has strongly encouraged the use of acceptances and looks for still greater offerings in the coming year. FINANCIAL, RESULTS OF OPERATION. As to earnings, expenses, dividends, etc., a comparative statement, marked "Schedule No. 1," is attached hereto, showing earnings and expenses for the calendar years 1916 and 1917, and amounts of net earnings; also amounts required to pay the 6 per cent dividends. Comparative balance sheets for December 30, 1916 and 1917, Schedule No. 2, attached, shows combined results of the Atlanta office and the New Orleans branch. Profit-and-loss statements for 1917 are shown in Schedule No. 3, attached. GENERAL BUSINESS CONDITIONS. The year 1917 opened in a period of general activity in all commercial lines, which has increased monthly. Wages have advanced with rising prices and business has been restricted only by inability 413 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

414 AHNUAL EEPOET OF THE FEDERAL EESEEVE BOARD. to secure goods and transportation facilities, with certain limitations of raw materials and labor. The numerous Army camps in the district have added materially to the retail and wholesale business. Eailroads have been handicapped in handling both passengers and freight, and there has been more or less congestion during the entire year. The closing of the }^ear finds industrial plants operating at full speed, with the exception that mills in some localities are operating on short time on account of lack of sufficient coal supply. Excellent seasons prevailed during the year and the agricultural producer was rewarded with bountiful harvests. The district produced the largest crops of food and feed stuff in its history. The cotton crop was up to normal and high prices prevailed for all farm products, giving this district a full measure of prosperity. Among the events of special business interest is the revival and enlargement of the shipbuilding industry at Savannah, Brunswick, Mobile, Pensacola, New Orleans, and other Gulf points. The labor situation at the end of the year does not present a very promising outlook. Many of the laborers have been drafted into the Army and with permanent emigration of many negroes to the North in the early part of the year, and the anticipated additional draft, the situation presented is a rather serious one, viewed from the future. Despite the great commercial and industrial activities a plentiful supply of loanable funds have been available throughout the year, and bank rates have been low and steady. The resources of the banks have been largely increased. FEDERAL RESERVE BAXK AND MEMBER BANKS. The most pleasant relations exist between the Federal Reserve Bank and the member banks, and the spirit of cooperation grows stronger with a clearer understanding of the advantages of the system, and the dissipation of the early fear of "red tape.'5 There is still some difficulty in obtaining credit statements of customers from the smaller member banks. The member banks, even in the smaller towns, appear to be able to more clearly judge the eligibility of paper from the Federal reserve standpoint, and it is seldom that paper sent in for rediscount has to be returned for reasons affecting its eligibility. During the year only one bank was closed by the Comptroller of the Currency. This bank had a capital and surplus of $1,250,000, and to date has paid the creditors 55 per cent. Five national banks, with a total capital and surplus of $2,245,000 liquidated in* order to consolidate with other national ban'ks. Thirteen national banks liquidated during the year, representing a capital and surplus of $802,000. Seventeen State banks in this district, representing a total capital and surplus of $13,281,000, became members of the Federal Keserve System. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 6—-ATLANTA. 415 Paid-in capital of the Federal Reserve Bank of Atlanta amounted December 31, 1916, to $2,450,000, and on December 31, 1917, $2,812,- 750. On December 31,1916, the capital and surplus of member banks in the sixth Federal Reserve district amounted to $81,666,667, and on December 31, 1917, to $92,408,300. The stock of the Federal Reserve Bank of Atlanta shows a net increase of 6,445 shares in the year 1917. DISCOUNT ACTIVITIES OF THE FEDERAL RESERVE* BANK. Schedule 4, attached hereto, shows the discount operations of member banks during the first half of the year, which were about normal as compared with previous years; but since the latter part of August there has been a steady increase in offerings; the highest point being reached on December 7, with a total of $22,754,273. MEMBER BANK DEPOSITS EXCESS DEPOSITS OVERDRAFTS. Schedule No. 5, attached hereto, shows the gross balances, overdrafts, required reserves, uncollected balances, and deficient reserves, by States, in the district as of close of business December 31, 1917. REPORTS AND EXAMINATIONS. A splendid spirit of cooperation exists between the officers of this bank and the chief national bank examiner of the district and has proven highly valuable. Frequent conferences are held and views exchanged of value to both offices. Examinations preliminary to admission of a number of State banks entailed considerable work on the auditor of the Federal Reserve Bank of Atlanta. It was decided at the November meeting of the board of directors to accept the examinations of State bank members as conducted by the State authorities, and reports of all such examinations are being mailed to the Federal Reserve agent. During the year one bank was closed on orders from the Comptroller of the Currency; and while the institution had. large rediscounts with the Federal Reserve Bank at time of closing, the indebtedness was adjusted without loss to the system. Several examinations of the Federal Reserve agent's department and one general examination of the bank and the branch at New Orleans were conducted by the Federal Reserve Board examiners during the year. THE FEDERAL RESERVE BANK AND THE PUBLIC. For the first three months of the year there was a very small amount of discounting. During the next three months there was an Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

416 ANNUAL KEPORT OF THE FEDERAL RESERVE BOARD. increasing demand for accommodation from our member banks, largely due to the agricultural conditions in our district. The bankers, especially those of the interior, were carrying out the wish of the Government in aiding the farmers to plant extraordinary crops. The banks of the district in general came to the relief of the farmers and aided them very materially in this respect. Earnings of the bank were largely affected by the issuance of United States Treasury certificates of indebtedness, in. whose purchase the Federal Reserve Bank of Atlanta participated. Another source of revenue was found in the fact that the member banks, who had bought of the first issue of bonds, qualified as depositories of funds derived from that source, and just as these funds were called in the member banks, to a certain extent, discounted paper to meet the withdrawals. However, it was not until August that our earnings increased materially, and since that time they have increased. Several causes, one of which was the high price of cotton, entered into this increased demand, and called for a great deal of money to market the crops. The banks availed themselves of the amendment to the Federal Reserve Act, which enlarged their acceptance powers. A considerable volume of cotton was handled in that way, and in some cases wheat and other commodities were handled by the use of these bankers5 acceptances. The member banks of the district subscribed freely to the second issue of the Liberty loan bonds, qualified as depositories, and when the deposits were called in they in many instances rediscounted with us to meet the withdrawals. All of these sources produced a good revenue for this bank, and enabled us at the close of the year to write off all the furniture and fixtures, set up a depreciation fund sufficient to cover any depreciation of securities, declare a dividend on our capital stock up to December 31, 1917, and pay into the Treasury of the United. States a like amount as a franchise tax covering the operations of this bank up to this time. Present indications point to a very active money market for the coming year. We believe that the revenues of the bank will keep pace with those of the past six months. We anticipate that there will be another offering of bonds to the public, and as noticeable in previous issues, our reserves will naturally decline during such period. We may also expect redemption of a considerable number of our bills during the months of January, February, and March, and, as these will be retired at 100 per cent gold, our reserve condition will naturally decline. From the present conditions, we need not be surprised to see our reserves reduced to probably 50 to 55 per cent, and for a short period of time they may drop lower than 50 per cent. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 6 ATLANTA. 417 OPEX MARKET OPERATIONS TRADE ACCEPTANCES. The Federal Reserve Bank of Atlanta has not been in the open market to purchase bills from nonmember banks since July and August of this year. Forecasting at that time that we would need our reserve to handle the business offered us by our member banks, we have kept out of the open market except for the purchase of $175,000 school warrants. While it is true that our statement shows a very satisfactory volume under the head " open-market operations," yet in the, true sense of the term " open-market" this is not the case. The items that we are carrying under that head are purchases of acceptances secured by cotton and other readily marketable commodities stored in warehouses, covered by insurance. These are acceptances of our member banks to purchase for the account of the drawers. This we consider a member bank operation, and though these papers are accepted by member banks they are not indorsed by member banks, and must be carried in the " open-market operations " column. We regard this as excellent paper, due to the fact that we are in control of the commodity against which the acceptance is issued. There has been only a limited development of trade acceptances in this district. However, a campaign of education is being conducted by credit men's associations in all the larger cities of the district in behalf of the use of trade acceptances. There has been a gradual increase, and we believe this business will continue to increase in consequence of the efforts that are being put forth. PUBLIC RELATIONS WORK. Considerable public relations work was conducted during the year. Monthly reports of business conditions, weekly bank reports, and items of general banking interest are furnished to the press. The press of the district have evidenced a deeper interest in the Federal Eeserve system than at the outset, and generously give of their space to its promotion as being of great benefit to the general public welfare. They more frequently bring to the public mind the value of the system in Governmental finance and its practicability in rediscount facilities. FEDERAL RESERVE BANK AND NOTE ISSUE. While the amended Federal Reserve Act permitting the issuing of Federal Reserve notes direct against gold is an added asset, the bank has not yet strongly felt the need of this policy, inasmuch as rediscounting has kept pace with the growing volume of outstanding Federal Eeserve notes. In view of the high price of cotton and other products of farm and factory, the demand for money has been correspondingly increased. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

& ANXTJAL REPOKT OF THE FEDERAL RESERVE EOARD. The increased demand for Federal Reserve notes has caused the Federal Eeserve agent at Atlanta to double the supply of notes kept on hand at Washington for use of this bank, from $50,000,000 to $100,000,000, in order to insure a plentiful supply at all times. The chief demand has been for fives, tens, and twenties; there being practically no call for fifties or hundreds. Schedule No. 6, made a part of this report, shows the denominations of Federal reserve notes issued and the cost of these notes. The outstanding Federal reserve notes on December 31, 1917, amounted to $66,867,420, as compared with $25,919,530, December 30, 1916, and were secured by $16,178,637 collateral, and $50,701,320 gold in the hands of the Federal Eeserve agent. The notes issued are not being returned in proportion to the usual after-crop movement period of previous years and with continued high prices and great Government activity in our district a normal return is not looked for. CLEARINGS. Schedule No. 7, made a part hereof, shows the transit operations for the year, by months, together with the cost of operation and revenue. Under the amendments to the Federal Eeserve Act, member banks are permitted to open checking accounts with Federal Eeserve Banks solely for the purpose of making use of clearing facilities, and in this way new par points have been added to the list. Further to extend the number of par points, we have permitted State banks to remit to us in eastern exchange in payment of letters— it being impossible to get any of these in Atlanta exchange, since the banks that have agreed to remit in some cases had no Atlanta account. In doing this, however, we of necessity had to give the same privilege to our member banks and in this way our " float" has increased to a certain extent. We believe that later on it will be possible to arrange with our member banks to send in their exchange on eastern points for credit and pay for items sent them either by remitting us check on ourselves or authorizing us to charge their account with outstanding letters, thus reducing the amount of " float" carried. Another feature that has encouraged the use of the par collection facilities of this bank has been that beginning with September 1 we put into effect a rule whereby member banks are permitted to clear through us, without any charge whatsoever, checks to the number of 500 each month; over and above 500 being charged for at the rate of 11 cents per item. An analysis of our transit department, prior to the interruption of the mail service on account of handling war supplies, shows that we were clearing points in the district on an average of two and three-quarters Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 6 ATLANTA. 419 days. Tills, however, has shown an increase within the last few months, requiring at the present time something like three days, or more, and it is possible that we may have to increase our time of deferred availability on items in this district, unless the mail service improves. The number of items handled shows a steady increase, and taken as a whole the system is working with general satisfaction. STATE BANKS. The State bank interest in the Federal Reserve System, culminated in the addition of a number of the larger banks in this district which quickly came into the system in response to the President's appeal. The State banks are better informed as to the working of the system and the advantages accruing from membership therein. The President's appeal forcefully drew public attention to the necessity of strengthening the Nation's financial structure through war's demands, and the advisability and practicability of unification for after-war world financing. The recent amendments to the Federal Reserve Act, permitting State bank members to retain their State charters and exercise all statutory rights; to continue to make loans in excess of 10 per cent of their capital and surplus to any one borrower; and the acceptance by the Federal Reserve Banks of examination as conducted by State banking authorities have been instrumental in the change of view. The State banks in the district eligible for membership in the system total 534, representing a total capital and surplus of $47,640,437; divided into groups as follows: Banks with capital and surplus not over $30,000 $3,652,550 Banks with capital and surplus $30,000 to $75,000, inclusive 12,800,387 Banks with capital and surplus over $75,000 31.187,500 The eligible State banks are as follows: Alabama, 110; Florida, 47; Georgia, 237; Louisiana, 64; Missisippi, 20; Tennessee, 56. " The following State banks joined the Federal Reserve Bank of Atlanta in 1917: Capital and Bank. Location. surplus. Marion Central Bank Marion, Ala., 5150,000 Citizens Bank & Trust Co Tampa, Fla. 750,000 American Trust Co Jacksonville, Fla., 210,000 Volusia County Bank DeLand, Fla 200,000 Citizens Bank West Point, Ga.. 50,000 American State Bank.' Athens, Ga , 120,000 Central Bank & Trust Corporation. Atlanta, Ga , 1,300,000 Trust Company of Georgia .do. 2,000,000 Brunswick Bank & Trust Co Brunswick, Ga 172,000 Citizens & Southern B ank Savannah, Ga 2,000,000 Savannah Bank & Trust Co .do. 1,200,000 Union Bank of Pike Summit, Miss 29,000 Hibernia Bank & Trust Co New Orleans, La.. 2,500,000 Interstate Bank & Trust Co .do 1,250,000 Metropolitan Bank do.. 600,000 Canal Bank & Trust Co do 700,000 Jefferson Trust & Savings Bank Gretna, La 50,000 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

420 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. EFFECT OF STATE BANKS REMAINING OUT OF SYSTEM. If the eligible State banks continue to remain out of the Federal Eeserve System, it will materially affect the strength of the Federal Reserve Bank of Atlanta, because in the event of a great financial disturbance the Federal Reserve Bank of Atlanta will necessarily have to come to the assistance of the State banks through the medium of the member banks who act as their correspondents in the district. It must be borne in mind that the eligible State banks in the sixth Federal reserve district that have not joined the system outnumber the member banks about 33 J per cent; and in the event of trouble they would certainly call on their correspondents in the district for help, and we in turn would have to aid our member banks. It is imperative that some means be found to bring into the system those State banks which to date have refrained from making application for membership either through indifference or lack of interest in the conditions that confront us. EFFECT OF DISCOUNT-RATE POLICY OF THE BANK UPON GENERAL MARKET RATES. The discount policy of our bank has been an appreciable influence upon the general market rates of the district. When we advance rates, our advance, as recently evidenced, has materially stiffened rates charged by member banks, especially in the larger cities of the district. The rates of the banks in the smaller cities and towns, as a general thing, are little affected by a change of rates as fixed by the reserve bank, though of late we have noticed a tendency in cities ranging in population from 15,000 to 30,000 to offer lower rates to their customers. It is also quite noticeable that when we increase our rates it has the effect of causing member banks to reduce their loans, thereby contributing to a more healthy condition in the matter of credits. INTERNAL MANAGEMENT OF THE BANK. Little change has been made in the internal management of the bank as to division of work between the bank proper and the office of chairman of the board and Federal Eeserve agent. At the time of the last yearly report the force consisted of 51 employees, including officers, but due to the increased work in the bank itself and added work in connection with the fiscal agent's department the force was increased to 135. Out of the original 51, 15 enlisted in the Army and Navy and the difficulty in replacing these experienced men reduced the efficiency of the institution. In replacing these men it has been necessary to pay larger Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT XO. 0 ATLANTA. 421 salaries, and the higher cost of living has necessitated a general increase in the pay of all employees. Mr. M. W. Bell, assistant cashier, has temporarily been relieved of his duties and detailed to act as manager of the fiscal agent's department, embracing the bond issue division, conversion division, securities division, and the war-savings and thrift stamp division. Mr. Jos, M. Slattery was appointed assistant Federal .Reserve agent and elected secretary to the board of directors. Mr. W. H. Toole resigned as a class A, group 3, director in October. ±vo election was held to fill the vacancy until December 6. Mr. P. IT. Saunders resigned as a class B, group 1, director in May, and Mr. Edgar B. Stern, of New Orleans, La., was elected to fill the vacancy. At the December election Mr. P. E. Kittles, of Sylvania, Ga., was elected a class A, group 3, director, and Mr. Edgar B. Stern reelected a class B, group 1, director, both for a term of three years. After an absence of several months on special duty Mr. J. B. Pike returned to assume his duties as cashier of the bank. Mr. Jos. A. McCord was reelected governor of the bank for the year 1918. Mr. W. H. Kettig, of Birmingham, Ala., was reappointed a class G director for a term of three years, ending December 31, 1919. BANK QUAKTEES AND VAULT FACILITIES. At the June meeting of the board of directors it was voted to authorize the erection of a building on the Marietta Street lot, previously purchased, at a cost not to exceed $170,000, on a basis of labor and materials in prewar times. Work was begun on the excavation and building during July, the building to be ready for occupancy prior to August, 1918. The building will be two stories, reinforced concrete with granite exterior, fireproof, and equipped with all the latest devices for protection. Work is progressing well and it is expected that the building will be ready within the allotted time* Contracts for the vaults were let separately. Considerable investigation and thought were given to the matter of vaults, and it was determined to erect vaults along the latest lines of construction, with all the improved electrical burglar-proof devices. The present quarters of the bank are wholly inadequate, both in floor space and vault room; and it has been necessary to rent additional space in the office building of our present location, and vault space in outside banks. NEW ORLEANS BRANCH OF THE FEDERAL RESERVE BANK. The number of banks allotted to the New Orleans branch has been increased during the year by the addition of four banks in the city Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

422 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD, of New Orleans and two outside of the city, representing a capital and surplus of $5,129,000. Little change has been made in the operation of the branch, and the results have been satisfactory during the year. In order to permit of a more intelligent comparison of the operating results of the branch and the parent bank, an agreement was reached as to the proper adjustment of administrative expenses. The branch bank serves the territory allotted to it in the same manner as the parent bank, subject to supervisory control of the parent bank. It retains all collateral deposited for Government deposits; holds all paper discounted and paper bought, and handles subscriptions to Treasury certificates and Liberty loan bonds as a separate unit. Federal Reserve notes are kept on hand in the United States subtreasury and issued on order from the Comptroller of the Currencjr by request of the Federal Reserve agent at Atlanta. The clerical force of the branch consists of 17 employees. THE FEDERAL RESERVE BAXK AND THE GOVERNMENT. The exigencies of Government financing in connection with the war has called into play to the fullest possible extent all of the admirably designed machinery of the Federal Reserve Banks, which has been employed in the handling of the various issues of Treasury certificates of indebtedness and subscriptions to the first and second Liberty loans of 1917. The Federal Reserve Banks are required by provision of the Federal Reserve Act to discharge, in the discretion of the Secretary of the Treasury, the functions of fiscal agent of the LTnited States Government, and while the authors of the Federal Reserve Act probably did not have in view the necessity for using the system to the extent that war conditions have incurred, and preparations were not made in advance for the transaction of business in volume such as the war financing has developed, the Federal Reserve Banks have been equal to the responsibilities and have developed organizations and perfected machinery for the handling of financial operations that have exceeded any previously experienced by Government agencies or departments since the foundation of our Government. The Federal Reserve Bank of Atlanta and its New Orleans branch have, without stint or restraint, given to the Government the use of their facilities in successfully handling and discharging the responsibility of properly putting before the public—through the instrumentality of its member banks, nonmember banks, trust companies, and other agencies in the sixth Federal Reserve district—every Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT XO. 6 ATLANTA. 423 • to and paying for certificates of indebtedness, Liberty loan bonds, war-savings, and thrift stamps, the sale of which securities have approximated $200,000,000 from April 25 1917. to the end of the year. The officers and employees of the Federal Reserve Bank of Atlanta and its New Orleans branch, assisted by numerous public-spirited citizens, have worked with patriotic devotion to make war financing a success in the district; and while the results accomplished did not largely surpass expectations, they exceeded the anticipation of those in position to know the conditions financially and what the people of the district might be reasonably expected to do in lending to the Government the use of their financial resources in investing in Government securities. It has been necessary to increase the clerical force of the bank about 150 per cent during the past six months. This involved the organization of seven new departments and the employing of a clerical force almost entirely untrained and inexperienced in this character of work. The matter of subscriptions to first and second Liberty loan bonds are about completed, but the details of conversion, sale of war savings certificates and thrift stamps and the formulation of plans for the handling of new issues of Government securities are engaging the attention of these new departments. The experience gained has been invaluable to the Federal Reserve Bank and will enable it to render much more efficient and effective services in the future. Our facilities and organization will be devoted with even greater patriotic devotion to the interests of our Government as the financing of the war progresses; and we know that the banks and other organizations, as well as the patriotic citizens who have given so freely of their time and talents, can be counted on to make additional sacrifices in the future. LIBERTY LOAN ORGANIZATIONS. The first Liberty loan campaign opened on May 1-1 and closed on June 15, 1917. The second Liberty loan campaign opened on October 1 and closed on October 27, 1917. The district was thoroughly organized on the plan of subdividing each State into a number of zones, with a chairman in charge of each zone. These zones reported direct to the Liberty loan committee for the entire district, with headquarters in the Federal Reserve Bank, Atlanta, Ga. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

424 AKXUAL REPORT OF THE FEDERAL RESERVE BOARD. SUBSCRIPTIONS TO LIBERTY LOAN BONDS. First Liberty loan: Subscription $57, 878, 550 Allotment $46, 283, 150 Number of subscriptions bandied by Federal Reserve Bank of Atlanta— Nonmember banks 636 Member banks 397 Individuals subscribed direct through this bank 1, 632 Estimated number of purchasers of the first Liberty loan 150. 000 Second Liberty loan: Subscription $92, 140,000 Allotment $83, 065, 600 Number of subscriptions handled by Federal Reserve Bank of Atlanta— Nonmember banks ' 878 Member banks , 484 Individuals subscribed direct through this bank 398 Estimated number of purchases of the second Liberty loan 275. 000 Total amount of certificates of Indebtedness of all issues allotted to subscribers in the sixth- Federal Reserve district. Number of! Amount allotted to subscriber. su i b n s c e r a i c b h e rs I IT e o a a t l c a lo h l t a t g e m r d o o u u to p n . ts group, i $25,000 and less 454 $5,333,000 Over $25,000 to $50,000 112 5,666,000 Over $50,000 to $100,000 91 8,388,000 Over $100,000 to $250,000... 60 10,713,000 Over $250,000 to $500,000.... 19 7,017,000 Over 6500,000 to $1,000,000., 3 2,500,000 Over $1,000,000 , 6 8,848,000 Total. 748 48,495,000 The extent of Federal Reserve Bank's ownership of Treasury certificates and Government bonds amounts to . $8, 281, 900. The amount of loans made by Federal Reserve Bank upon United States bonds and Treasury certificates as collateral .amounts to_ 22, 772, 600. There are 55 special employees engaged in the bond department, and there is attached as a part of this report a statement showing the expenditures in the conduct of Liberty loan operations, and the extent of the bank's reimbursement by the Treasury Department for the outlay—Schedule No. 8. The subscriptions for the Liberty loan bonds did not materially affect finances of either banks or business houses in the district. Deposits are greater now than they were before the first Liberty loan, eliminating the amount of Government deposits still held by banks as a result of the second Liberty loan. The expenditures of the Government for materials and provisions bought in the district about offset Government withdrawals as a result of purchase of Liberty bonds. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT HO. 6 ATLANTA. 425 SCHEDULE 1.—Con)partitive statement of earnings and expenses. 1917 1916 COMBINED EAENINGS. Bills discounted and bought: Bills discounted—members $231,635. 57 $141,774. 27 Acceptances bought in open market 102,311.56 52.473. 79 Investments: United States securities 140,820. 48 725. 41 Municipal warrants 3, 629. 26 101.85 Profits realized on United States securities 25,568. 99 Transfers—net earnings 17,134. 05 Commissions received 153.07 Purchase of United States bonds 1,, 530. 27 Deficient reserve penalties (including interest) 13, 526. 88 Sundry profits 6, 758. 45 "26" 185.'94 Total earnings.. 541,385. 24 261,944.60 EXPENSES. Assessments, expenses Federal Reserve Board., 9 442. 27 8;546. 82 Federal Advisory Council 466. 63 357 Governors' conferences 299. 98 1,095.89 Federal Reserve agents7 conferences 182 60 Salaries: Ofiicers 36,470. 93 31,016.63 Clerks 37,892. 48 31,317.33 Special officers and watchmen 3, 424.10 3.258.15 Directors' fees 2,188. 08 2, 790. 00 Directors' per diem 2,540. 00 2,038. 00 Directors3 traveling expenses 2, 471. 42 2,251. 46 Officers and clerks traveling expenses 1,066.94 1, 299.44 Legal fees 600. 00 1,400. 00 Rent 12,152. 92 11,572.18 Taxes and fire insurance 1, 210. 64 Telephone 535. 05 348. 69 Telegraph 842. 86 569. 63 Postage 6,825. 77 4,569. 70 Expressage 2, 483. 33 661. 87 Insurance and premiums on fidelity bonds 1,801. 90 1,192. 23 Light, heat and power 174. 67 141. 78 Printing and stationery 7,062. 67 4,240. 33 Repairs and alterations 27.86 205. 55 All" other expenses 16, 494. 72 7, 427. 05 Total expenses of operation Cost of Federal Reserve notes issued Cost of Federal Reserve notes unissued (on hand) Depreciation: Furniture and equipment Bank premises Gross earnings Less total expenses, SCHEDULE NO. 1A.—Statement of capital stock and dividend' of the Federal Reserve Bank of Atlanta. Accrued State. Number Paid in capi- dividend of banks. tal stock. to Dec. 31, 1917. Alabama 95 $544, 200.00 $32,271. 65 Florida . . . . 57 319,100. 00 16, 895. 47 Georgia . 107 854. 250. 00 39,696. 75 Louisiana 25 48i; 450.00 20,530. 75 Mississippi 18 116, 600. 00 6,945.41 Tennessee 90 497,150. 00 29,125. 58 Total 392 2,812, 750. 00 145, 465. 61 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

426 AKNUAL REPORT OF THE FEDERAL RESERVE BOARD. SCHEDULE NO. 2.—Statement of the condition of the Federal Reserve Brink of Atlanta. Dec. 31, 1917. Dec. 30, 1916. COMBINED RESOURCES. Bills discounted—members $11,805.589.16 $2,414,133.02 Member banks' collateral notes 2,628.250. 00 550,000.00 Acceptances bouglit in open market. 6,497^061.67 4,447, 696.96 Total bills discounted and bought. 21,020,900.83 7,411,829.98 Other United States bonds owned 2,397,000.00 1,710,000.00 One-year Treasury notes 1,491,000.00 824,000.00 Municipal warrants 284,372.00 401, 509.00 Bill of lading drafts 503,831. 60 Interest accrued on United States securities. 25,814.07 14,386.6 Total. 4,702,017.67 2,949,895.66 Cost of unissued Federal Reserve currency. 588.24 20,314.87 Other deferred charges 2:,,237.36 517.43 Furniture and equipment 12,282.26 Bank premises '140,875.20 102,500.00 Expense: Liberty loan 514.02 War savings 180.05 Total.. 189,394.87 135,614.56 Due from other Federal Reserve banks, collected funds 2,182,401.91 5,312,435.71 Due from member banks—overdrafts 4,819.11 Due from branches and offices 354,061.46 Due from banks and bankers 341,704.52 Exchanges for clearing house 2,552.616. 60 825,242.33 Checks and other cash items so;940.23 21,806.71 National bank notes and notes of other Federal Reserve banks. 950.00 Other mutilated currency for redemption 2,395.250.00 Deferred debits 232; 5,117,731.24 Federal Reserve banks- Transfers bought 803,000.00 Other items 3,668,787.35 Branches and offices 674,174.47 Member banks 8,315,185.16 Nonmember banks and bankers 519,945. 77 Total.. 21,785,312.95 11,623,739.62 National bank notes and F ederal Reserve notes of other banks. 1,677,795.00 Federal Reserve notes on hand 1,909,030.00 1,241,765.00 Mutilated Federal Reserve notes forwarded for redemption 43,500. 00 180,000.00 Nickels and cents 407. 51 160. 83 Total.. 1,952,937.51 i 3,099,720.83 Gold settlement fund 12,482,000.00 7,439,000. 00 Due from United States Treasury gold redemption fund.. 1,119,140.98 348,778.29 Gold bullion and coin 1,548,322.72 1,354,671.07 Gold certificates (including clearing-house certificates) 4,169,000.00 3,891,860.00 Silver certificates (including clearing house certificates)... 397,889.00 67, 467.00 Legal-tender notes (including clearing-house certificates). 13,200. 00 13, 752. 00 Silver coin 4,626.00 1,407.00 Bank of England—Sterling gold account 1,575,000.00 Gold with Federal Reserve agent 50,701,320.00 Total reserve... 72,010,498.70 13,116,935.36 Total resources. 121,661,062.53 38,337,736.01 COMr.INED LIABILITIES. Capital paid in. 2.812,750.00 2.450,000.00 Profit and loss. 80,000.00 10,120.04 Total. 2,892,750.00 2,460,120.04 Unearned discount: Bills discounted, members 37,292. 75 9,522. 43 Acceptances bought in open market... 26,635.01 12,631.55 Unearned interest on municipal warrants. 1,229.25 1,557.47 Reserved for sundry expenses 59,492.92 460.64 Service charges (net receipts) 2,483.24 Total.. 124,649.93 | 26,655.33 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 6 ATLANTA. 427 SCHEDULE NO. 2.—Statement of the condition of the Federal Reserve Bank of A tla nta—Conti n ued. Dec. 31,1917. Dec. 30, 1916. United States Government deposits $4,476,782.74 $3,821,076.20 Due to member banks, reserve account 36,849,923.90 21,812,983.12 Due to other Federal Reserve Banks 1.334,971. 71 5,762,247.41 Cashier's checks . 13, 783. 26 52,828.06 Expense checks 2,195.47 1,007.16 Dividend checks.. 145,465. 61 70,941.30 Federal Reserve Bank drafts 115,280.00 Due to nonmember banks and bankers 97,903. 27 Deferred credits 58,727.49 Federal Reserve banks 3,094,279. 83 Branches and offices 222,655.30 Member banks. 5,376,124.80 Miscellaneous... .33 Nonmember banks .. 46,876.38 Return item checks.. 50.00 Total 51,776,242.60 31,579,860.64 Federal Reserve notes outstanding 66,867,420.00 4,271,100.00 Total liabilities 121,661,062.53 38,337,736.01 SCHEDULE NO. 3.—Earnings and expenses for calendar year 1917; also profiit and loss, Dee. 31, 1911. Earnings for 1917, as shown by Form 95 $341, 385. 24 Discount on United States bonds 437. 50 Total earnings for 1917 $541,822.74 Expenses of operation (bank proper) 146,475.22 Cost of Federal Reserve notes issued 54, 808. 22 Cost of Federal Reserve notes on hand and unissued. 14, 320. 00 Depreciation: Furniture and equipment 8,177. 80 Bank premises 2, 500. 00 Transit department disbursements in excess of service charges 2, 277. 04 Reserved for depreciation of securities "24, 909. 00 Difference account 272. 01 Total expenses for 1917 253, 739. 29 Net earnings for 1917 288, 083. 45 Profit and loss, Jan. 1, 1917 10,120. 04 Total 298 203.49 ; Dividend paid July 1, 1917, period covered July 1, 1916-Dec. 31, 1916 70, 506. 87 Dividend paid Jan. 1, 1918, period covered Jan. 1, 1917-Dec. 31, 1917 145, 465. 61 Premium on surrendered stock in 1917 2, 231. 01 218, 203. 49 Profit and loss Jan. 1, 1918 80, 000. 00 34365°—18 28 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

428 AIsXUAL EEPORT OF THE FEDERAL RESERVE BOAED, Total profits to date; Dividend No. 1, paid June 30. 1916, covering period Nov. 14. 1914-Dec. 31, 1915 $129,19S. 00 Dividend No. 2, paid Dee. 81. 1017, covering period Jan. 1, 1916-June 30, 1910 70,949.30 Dividend No. 3, paid July 1. 1017, covering period June 30, .1916-Dec. 31, 1910 70,506.87 Dividend No. 4, paid Jan. 1. 1918. covering period Jan. 1, 1917-Dec. 31. 1917 145,465.61 Premium paid on surrendered capital stock. 101-3 2, 879.17 Premium paid on surrendered capital stock, 1017 2. 231. 01 5,110.18 Total dividend to date 421,229.915 Undivided profits, Dee. 31, 1917 80, 000. 00 Total net profits to date 501,229.96 SCHEDULE NO. 4.—Bills discounted and member banks1 collateral notes for 1917. Member banks' collateral notes: Secured by— Liberty loan bonds or certificates of indebtedness $18,399,800.00- Bills receivable 30, 679, 856. 00 Bills discounted—members : Within 15 days 14,014,698.34 Within 30 days 6,745,886.20 Within 60 days 14, 096, 707. 66 Within 90 days 9, 498, 642. S3 Over 90 days 1,052,151.67 Total 95,114, 742. 70 Bills bought in the open market during 1917: Bankers' acceptances— Foreign and domestic 26, 373, 464. 00 Trade acceptances 19,100. 00 Total 26, 392. 564. 00 United States securities (exclusive of bonds held under repurchase agreements shown below.* held Dee. 31, 1917: United States bonds— 2 per cent consols 1030 640, 600. 00 2 per cent Panama bonds 1916-36 21, 000. 00 3 per cent conversion bonds 10, 300. 00 3 per cent one-year Treasury gold notes 1, 491, 000. 00 3§ per cent United States Liberty loan bonds 215, 900. 00 4 per cent United States Liberty loan bonds 9, 200. 00 Total bonds 2, 388, 900. 00 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT ISTO. 6—ATLANTA. 429 United States certificates of indebtedness: 2 per cent: Bought ______ -___ $1, 750, 000. 00 Sold - 250,000.00 3i per cent: $1,500,000.00 Bought 1, 066, 000. CO Sold . 933, 000. 00 73, 000. 00 3 per cent, bought 506, 000. 00 3* per cent, bought—— ——— - 4, 293, 000. 00 4 per cent: Bought 4, 781, 000. 00 Sold 410, 000. 00 4 371^ ooo. 00 } Total United States certificates of indebtedness on which accrued interest was collected at maturity 10,743,000.00 United States Liberty loan bonds bought under repurchase agreement: 4 per cent. 31 per cent. Total bought to Dec. 31, 1917 0, 464, 400. 00 75, 000. 00 Total repurchased by member banks 5,039,400.00 Total held Dec. 31, 1917 1, 425, 000. 00 75, 000. 00 Investments in municipal warrants made during 1917: Within 30 days 61,000.00 Within 60 days 20,479.00 Within 90 days 57,937.00 Over 90 days 276,019.00 Total 415, 435. 00 SCHEDULE NO. 5.—Due to member hankx at the clone, of business Dec. 31, 1917. Number of banks. Gross balance. Alabama 94 $6,132,734. 05 Florida 57 3, 830, 533. 29 Georgia 107 12, 595, 666.18 Tennessee 90 7,036, 223. 59 New Orleans. 44 12, 630, 891. 59 Total... 392 42, 226,048. 70 Due to nonmember banks, clearing account, $144,759.65. SCHEDULE XO. 6.—Federal Reserve notes. TOTAL NUMBER OF NOTES ISSUED IN 1917 AND 1916. 1916 1917 Total. Number. Amount. Number. Amount. Number. Amount. Fives 604,000 $3,020,000 2,280,000 $11,400,000 2,884,000 $14,420,000 Tens 344,000 3,440,000 1,880,000 18,800,000 2,224,000 22,240,000 T Fi w ft e ie n s ties 1 1 9 3 2 , , 4 0 0 0 0 0 3; 6 8 7 4 0 0 , ,0 0 0 0 0 0 8 2 4 2 8 , , 2 0 0 0 0 0 1 1 6 , , 1 9 1 6 0 0 , , 0 0 0 0 0 0 1,04 35 0 , ,0 6 0 0 0 0 20 1 , ,7 8 8 0 0 0 , , 0 0 0 00 0 Hundreds 4,000 400, 000 1,500 150,000 5,500 550,000 Total 1,157,400 11,370,000 5,031,700 48, 420,000 6,189,100 59, 790,000 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

430 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. SCHEDULE NO. G.—Federal Reserve notes—Continued. ON HAND DEC. 31, 1917. Number. Amount. Fives . 503,800 $2,519,000 Tens 233,650 2,336,500 Twenties. .. . 163,725 3,274,500 Fifties 29, 800 1,490,000 Hundreds 22,500 2,250,000 Total 953,475 11,870,000 SCHEDULE 7A.—Revenue and expenses of the transit department. July 15 to Dec. 30, 1916. Service charges (net receipts).. £45,484.29 $20,058.77 Service charges—balance 1916.. 2,483.24 Total. 47,967.53 20,058.77 Salaries: Officers 468. 77 850.00 Clerks 20,278.53 8,421.00 Officers' and clerks' traveling expenses, 546.25 Legal fees 185.00 Rent 2, 750.04 1,273.02 Telephone 36.25 12.80 Telegraph 15.66 3.79 Postage 8,278.98 3,364.48 Expressage 10.80 2.20 Light, heat, and power 147.75 18.65 Printing and stationery 2, 293. 82 1,232.77 All other expenses 5, 032.75 1,238.81 Total expenses of operation 39,498.35 16, 963. 77 10, 746.22 611.76 Depreciation—furniture and equipment. Total transit department expense. 50,244. 57 17, 575.53 Total revenue received. 47/967.53 20,058. 77 Less expense 50,244. 57 17, 575.53 Excess. 2,483.24 Deficit. 2,277.04 SCHEDULE NO. 7-B.—Transit department operations. NUMBER OF ITEMS CLEARED. Clearing house. | Within district. Other districts. Total. January 31,807 268, 881 42, 816 343, 504 February.. 23,396 228,466 40,541 292, 403 March 27, 747 267, 534 45,454 340, 735 April 28,058 253, 849 39,088 320,995 May 29,165 242, 621 36,499 308, 285 June 30, 651 231, 258 34,134 296,043 July 29, 557 225, 321 34,183 289,061 August 30,064 225, 621 34,139 289, 824 September. 28, 714 231,197 35, 066 294, 977 October 34, 806 296, 883 37, 791 369,480 November. 37,267 305, 046 34,014 376,327 December.. 38,196 306,311 38,018 382, 525 Total 3, 082, 988 451,743 3, 904,159 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 6—-ATLANTA. 431 SCHEDULE 7-B.—Transit department operations—Continued. AMOUNTS CLEARED. Clearing house. Within district. Other districts. Total. January $27, 825,651.51 $47, 587,689.44 $34,117,698.13 $109,531,039.08 February.. 17, 633,626.06 37,454,504. 79 28,516,879. 66 83,605,028.51 March 20, 833,334. 68 44, 779,542.44 37, 086,899. 83 102,699, 776.95 April 25,165,742.17 46,036,180.98 41,665,839.85 112,867, 763.00 May 29,459,619.00 45, 541,331.01 36,453,216. 82 111,454,166.83 June 27, 607,361.38 41,073,446.12 36,957,908.66 105,638, 716.16 July 28, 013,801.65 41,469,304.45 44,112,210. 92 113,595,317.02 August 20,264,544.39 44,371,427.31 35,869,246.00 106,505, 217.70 September. 30, 841,993.37 52,044,034. 71 39,333,788.35 122,219, 816.43 October 47, 703,371.19 76,776,793.76 56,537,781.25 181,017,946.20 November. 61, 830,910. 53 74, 848,193. 93 57, 779,171.28 194,458,275. 74 December.. 61,355,280.72 69,414,140.17 71,766,475.11 202,535, 896.00 Total. 404, 535,236.65 621,396,589.11 520,197,115. £ 1, 546,128,959.62 Average number of items handled daily 12,514 Average amount of items handled daily $5,085,950.52 GOVERNMENT CHECKS HANDLED FROM MAR. 16 TO DEC. 31, 1917. Number of Amount of items drawn items drawn on U. S. on U. S. Treasurer. Treasurer. March 2,275 $285,181 April 8,664 920,772 May 12, 714 1,181,112 June 10, 802 13,578,654 July 12, 057 13, 823, 742 August 13,227 6,622,022 September. 13,512 7, 723,104 October 19, 680 11,775,962 November. 18,500 16,101, 691 December.. 15, 868 18,173, 875 Total. 127, 299 90,186,115 SCHEDULE NO. 8.—Expense of the first and second Liberty loan, to the close of business Dec. 31, 1917. Salaries: Bank officers $2, 985. 00 Clerical staff 16, 834. 61 Officers' and clerks' traveling expenses 2, 053.13 Rent . 641.27 Telephone 464. 33 Telegraph 4, 025. 30 Postage 4, 837. 44 Expressage 206. 66 Printing and stationery 16,074.24 Advertising 3, 978. 76 All other expenses 17 099. 66 ? Total expenses 69, 200. 40 Less reimbursements- 24, 686. 38 44, 514. 02 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

432 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. WAR-SAVINGS CERTIFICATE AND STAMP ACCOUNT. Salaries, clerks $922, 94 Officers' and clerks' traveling expenses 63. 41 Telegraph .65 Postage .28. 00 Printing and stationery 35. 05 All other expenses .__. 132. 00 Total expenses of operation 1,180. 05 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 7—CHICAGO. WM. A. HEATH, Chairman and Federal Reserve Agent. GENERAL BUSINESS CONDITIONS. The beginning of 1917 found generally satisfactory business conditions in the seventh Federal Reserve district, with some indications of increasing activity and a plentiful supply of money at low rates. The entrance of the United States into the war constituted a factor which up to that time had not been taken into serious consideration and necessarily brought about a great deal of readjustment. The promotion of new enterprises was, of course, greatly curtailed, and as the year advanced it was increasingly evident that expansion of already existing activities should be carefully guarded, except as necessitated by the demands of the Government in connection with carrying on the conflict. Some lines of commercial operation have suffered greatly. The distilling business, because of legislation enacted by the last Congress, has greatly diminished. The seventh Federal Reserve district has felt this for the reason that a large amount of such business was conducted within its bounds, perhaps the largest internal revenue producing district in the country being located within its limits. Building, construction, and engineering lines have also been very quiet and their operations much reduced. Those lines of business, however, which have been directly affected through Government contracts for food, clothing, munitions, and other supplies have seen greatly increased activity. Bank clearings have increased and indications are that the current year will show largely increased profits for banking institutions in general, except along the line of investment banking. Legitimate business, except as above noted, has, of course, felt the effects of the war, but it is becoming increasingly evident that the business public is adjusting itself to the situation and that the people are learning that commerce and trade may, notwithstanding such conditions, be transacted, if not as usual, at least on a sane and conservative basis. Notwithstanding the fact that some of the greatest industrial centers of this country are located within its borders, the district, as a 433 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

434 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. "whole, is largely an agricultural one. The rural communities have been the last to appreciate that the country was really and actually in war and to comprehend the seriousness of the situation which confronts the Nation. In the northerly States of the district beans, potatoes, and other vegetables constitute this year a large part of the farm product, and these suffered from early frosts. The wheat crop for the district was probably not more than two-thirds of an average yield. The prices for the above-mentioned articles, however, were so satisfactory that the financial return will probably equal that of the ordinary 100 per cent crop. The hay crop was somewhat below normal, but prices were good. The oats crop was the largest on record all over the district, and prices w7ere more than satisfactory. While the corn crop is rated as the largest on record the quality can not yet be determined. Much of it is not fully matured owing to unseasonable summer conditions and early frosts. Much of that which is at present unmarketable can, however, by proper handling and treatment, be made of commercial value, but a goodly proportion of the crop is available only for stock-feeding purposes, and within the last month or two a very strong demand has arisen in the country districts for funds for purchasing cattle and hogs to thus utilize this otherwise useless product. Prices are such, however, that notwithstanding the poor quality of much of the crop the returns will be very satisfactory, and all kinds of live stock are selling at high figures. Whatever the complete returns may demonstrate, the impression is general that money paid out on account of the war is slow in returning to this district, and with the value of our great staple, corn, yet undetermined, it is evident that a comprehensive forecast of conditions in the district might widely miss the mark. LOANS AND REDISCOUNT OPERATIONS. Applications for loans (including advances on bill of lading drafts) and rediscounts to the number of 3,747 were approved, amounting to $521,771,070, at 3 to 5| per cent basis from 541 banks, as follows: Illinois, 158 banks $2S7, 592, 763 Indiana, 88 banks 28, 067, 829 Iowa, 198 banks 53,923,991 Michigan, 51 banks 89, 486, 872 Wisconsin, 48 banks 62, 699, 615 Trade acceptances amounting to $429,845.08 are included in the above total. Loans and rediscounts secured by Liberty bonds and Treasury certificates of indebtedness amounting to a total of $191,- 757,389.66 are also included in the above figures. Loans and redis- Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 7—CHICAGO. 435 counts were at their lowest ebb on April 23, when the combined total w^as but $780,423.38. The highest point reached wTas on December 26, the combined figure being $112,164,286.96. OPEN-MARKET OPERATIONS. Investments.—Municipal warrants amounting to $2,164,488.64, representing the obligations of seven municipalities, all maturing within six months, were purchased during the year at 2|- to 4 per cent. Acceptances.—Bankers' acceptances and foreign trade acceptances totaling $66,714,060.14 were purchased during the year at 2J to 4 per cent, all represented by bills drawn in connection with imports or exports, these being acceptances by 89 institutions of known responsibility and purchased in the open market. United States Government bonds.—Two per cent consols and Panamas to the extent of $1,461,500 were purchased and converted during the year. Three and one-half per cent Liberty loan bonds amounting to $39,524,260 were purchased and sold by the bank during the year. Treasury certificates of indebtedness purchased by the bank. Date. Amount. Rate. Date. Amount. Rate. Per cent. Per cent. Mar. 31. $5,000,000 2 Sept. 17 $2,060,000 Apr. 25. 785,000 3 Sept. 26 5,150,000 May 10.. 1,252,000 3 Oct. 18 250,000 4 An? Q 1 000 000 31- Aug. 28 1,000,000 3i Total 16,497,000 The above figures include the bank's own direct subscriptions to the various issues. OFFICERS AND DIRECTORS. m An amendment to the Federal Eeserve act was passed during the current year abolishing the office of deputy Federal Eeserve agent and authorizing the Federal Eeserve agent to appoint one or more assistants. Mr. W. F. McLallen, who held the office of deputy Federal Eeserve agent, was at once appointed assistant Federal Eeserve agent for the remainder of the calendar year. Toward the close of the year Mr. Mark A. Lies was appointed an additional assistant Federal Eeserve agent. Mr. McLallen was also designated by the Federal Eeserve Board as deputy chairman of the board of directors. Additional assistant cashiers were appointed during the year as follows: Mr. F. J. Carr, Mr. Clarke Washburne, and Mr. D. A. Jones, Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

486 ANNUAL EEPOET OF THE FEDERAL RESERVE BOAKD. At the annual election for directors in December, 1017, Mr. E. L. Johnson was elected to succeed himself for the full three-year term as a director of class A, group 3, and Mr. M. B. Hutchison was elected to succeed himself for the full three-year term as a director of class B, group 2. On December 19 the Federal Reserve Board elected Mr. James Simpson, of Chicago, class C director for three years and designated him deputy chairman for one year. On December 21 the Federal Reserve Board redesignated the present incumbent as chairman and Federal Reserve agent of the Federal Reserve Bank of Chicago for a period of one year, dating from January 1, 1918. MEETINGS. Directors.—The board of directors has held 12 regular meetings during the year. Executive committee.—The executive committee is composed of Gov. McDougal, Mr. W. F. McLallen, Mr. J\ B. Forgan, Mr. G. M. Rejaiolds, and the Federal Reserve agent. This committee has held regular meetings once each week, but the great increase of businesb toward the close of the year has necessitated two regular meetings each week. Membership.—This committee is composed of Gov. McDougal, Mi-. A. H. Yogel, and the Federal Reserve agent, Officers.—Early in the year there was inaugurated a plan of holding informal meetings of the officers daily before business hours. This plan has been followed throughout the year except as it has been interfered with to some extent through unusual activities in connection with the Liberty loan campaigns and other emergencies. MEMBERSHIP. Seven national banks have surrendered their charters during the year, the total reduction of Federal Reserve Bank stock from this source amounting to $45,400. Twelve new national banks have been organized during the year. Applications for membership from 63 State banks have been approved during the same period. Of these, 51 have paid in their capital stock and reserve. Three have paid in their capital only. The remaining nine were approved so recently that their payments could not be made before the first of the year. Fifty-two banks were transferred to this district from the Minneapolis district at the beginning of the year. Membership December 31, 1916, 993; December 1, 1917, 1,100. The net increase in the stock of the Federal Reserve Bank of Chicago from ail sources during the year has Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 7—CHICAGO. 437 been $2,408,150. A complete list of State bank members will be found in the appendix, The prospect for a branch of the Federal Reserve Bank at Detroit, Mich., has had a stimulating effect on State bank membership in that city. In November a special session of the Michigan Bankers' Association was held at Lansing, Mich., at the instance of the governor of the State, the bank commissioner, and the president of the bankers' association, for the special purpose of arousing interest among State banks concerning membership in the Federal Reserve system. Addresses were made at this session by the above-named officials, and also by Mr. Frederick R. Fenton, Federal Reserve chairman for Michigan; and the results were most gratifying, as will bo seen by the increased membership from that State. The appeal of the President of the United States urging State banks to join the system has not, up to this time, met with a generous response. Two or three of the larger State institutions in Chicago and a few scattering banks throughout the district came in as a direct result of that appeal. There are, however, approximately 2,000 State banks in the district which are eligible for membership and less than 100 applications, all told, have been received up to this time. It is nevertheless evident that greater interest in this subject is being manifested throughout the district than heretofore. Many of the larger State institutions are seriously considering the matter, and some of them have signified their intention of applying for membership in the near future. BANKING QUARTERS. The Federal Reserve Bank of Chicago has very inadequate quarters, both as to working space and vault capacity. At the present time the bank is occupying space in four different buildings in Chicago. The executive committee has been instructed to investigate the question of new and adequate quarters for the bank, but there is nothing available in Chicago at the present time and no one seems willing to take the responsibility of constructing an entirely new building until after the war is over. BRANCHES. The board of directors at its regular meeting on November 27 authorized the establishment of a branch of the Federal Reserve Bank of Chicago to be located in the city of Detroit, Mich. The following have been chosen as directors of the branch: Mr. Robert B. Locke, at present manager of the Detroit Clearing House Association; Mr. John Ballantyne, president of the Merchants' National Bank, Detroit; Mr. Charles H. Hodges, president of the Detroit Lubricator Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

438 ANNUAL REPORT OF THE FEDERAL EESEEVE BOARD. Co., Detroit; Mr. Emory W. Clark, president of the First and Old Detroit National Bank; Mr. Julius H. Haass, president of the Wayne County and Home Savings Bank, Detroit. Mr. Kobert B. Locke "will be the manager of the branch. It is the expectation that this branch will be formally opened for business shortly after the first of the year. PTTBLicrrr WORK. The publicity work of the bank during the past year has been conducted through personal interviews, correspondence, and attendance by the bank's officers at many bankers' conventions and group meetings. The monthly business reports of the bank have been circulated as bulletins. A special pamphlet on trade acceptances has been printed and widely circulated, and Mr. Clarke Washburne, assistant cashier, has made a number of informal talks to various trade organizations on that subject. FEDERAL RESERVE TRANSFER AND EXCHANGE DRAFTS. During the year five banks in this district have ordered a supply of Federal Reserve transfer and exchange drafts. But one of the banks is using the plan. Twelve member banks in other districts have drawn Federal Reserve transfer drafts on this bank. The total transactions have been small. GOLD SETTLEMENT FUND. A complete statement showing the volume of transactions through this fund on a basis of weekly averages appears in the appendix. FEDERAL RESERVE NOTES. The Federal Reserve agent maintains in Chicago constantly a reserve supply of Federal Reserve notes amounting to $41,500,000. There is held in the subtreasury in Chicago an additional reserve supply of Federal Reserve notes amounting to $26,160,000, and in Washington, printed or in process of printing, in round numbers, $185,000,000, it being the desire of the board of directors to keep always in sight a total reserve stock of over $250,000,000. In addition to the above there are $5,000,000 of Federal Reserve bank notes printed and held in stock in Washington. An exhibit in detail of the various issues appears in the appendix. NONMEMBER BALANCES—CHICAGO CLEARINGS. During the summer a plan was agreed upon whereby all nonmember banks belonging to the Chicago Clearing House should open accounts with the Federal Reserve Bank and clearing house balances Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 7—CHICAGO. 439 be settled by certified check on the Federal Reserve Bank. This plan became operative September 1 and seems to have worked to the satisfaction of all concerned. Eleven nonmember banks at that time opened accounts with the Federal Reserve Bank. Four of these have since that date entered the Federal Reserve system, leaving seven nonmember banks still carrying balances with us. These balances total about $5,000,000 on the average. One of these nonmember banks is using the Federal Reserve collection system. FIDUCIARY POWERS. Permits have been issued during the year to a number of institutions for the exercise of various trust functions which are permitted under the Federal Reserve act. A detailed list of these permits appears in the appendix. PERMITS TO ACCEPT UP TO 100 PER CENT. During the current year the Federal Reserve Board has granted to the National Bank of the Republic of Chicago, and the Continental and Commercial National Bank of Chicago, the right to accept up to 100 per cent of their capital and surplus. RESERVES. Fluctuation in reserves during the year is indicated as follows: Against deposits: Gold (high), 81.5 per cent on February 2, 1917. Gold (low), 50.9 per cent on June 20, 1917. Gold and lawful money (high), 83.2 per cent on February 2, 1917. Gold and lawful money (low), 52.2 per cent on June 20, 1917. Against Federal Reserve notes": Gold (high), 157 per cent on January 2, 1917. Gold (low), 59.5 per cent on November 23, 1917. Against combined note and deposit liability : Cash reserve (high), 85.9 per cent on February 2, 1917. Cash reserve (low), 60.6 per cent on November 23, 1917. DIVIDENDS AND EARNINGS. During the year dividends amounting in all to 12 per cent have been paid. All dividends accrued to December 31, 1917, are therefore paid in full. Also payment to the United States Treasury of its pro rata of surplus earnings has been made, amounting to $215,- 799.18. Furniture and fixtures, depreciation on bonds and the cost of Federal Reserve notes issued to the bank have all been charged off in full. A detailed statement of profit and loss appears in the appendix. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

440 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. OPERATIONS OF THE FEDERAL RESERVE COLLECTION SYSTEM. There have been handled during the year 7,532,366 items as follows: Items. Amount. Total cost. C i o t s e t m p . er C $ o 1 s , t 0 0 p 0 e . r p S c e e h r r a i v r t i g e c e m e . Items on banks in Chicago 1,807,728 $3,985,878,000 $7,200.00 $0,004 $0.0018 $0.0 Items on banks in district outside of Chicago. 4,362,436 987,821,000 / .0125 .0518 Items on banks in other districts.. 511,438 187,450,000 } t>u,8fco.8/ \ .0125 .0518 X .015 Government checks 850,764 202,461,000 • 4,800.00 .0056 .0237 .0 Total . 7,532,366 5,363,610,000 72,885.87 .00967 .0136 The disbursements or expenses of the transit department made necessary by and in connection with the handling of items drawn on " Banks in district outside of Chicago," and " Items on banks in other districts," total $60,885.87, while the net service charges assessed against the member banks and other Federal Reserve Banks covering same total $62,449.87, a net profit in handling these two classes of transit items during the year of $1,564. Adding, however, the cost of handling items on banks in Chicago ($7,200) and Government checks ($4,800) it increases the total expenses ($12,000) to a total of $72,885.87, or a net cost for the year in handling the above four classifications of $10,436. There have been added to the Federal Eeserve par list from January 1 to December 31, 1917, 618 points or towns and 1,082 banks—975 nonmembers and 107 members. The bank has handled a small amount of collections, drafts, notes, etc., for its customers during the year on a basis of actual cost. But one nonmember bank carrying an account with the Federal Eeserve Bank is making use of its collection system. FISCAL AGENCY OPERATIONS, FIRST LIBERTY LOAN. When the Secretary of the Treasury offered the first issue of $2,000,000,000 of 3J per cent bonds, a meeting of representatives of prominent banks, trust companies, and bond houses was called to consider ways and means for its sale. There were present at this meeting some 50 or 60 representatives. This body appointed an executive committee, which committee in turn organized itself into a publicity committee. The publicity committee took charge of the selling campaign and appointed an assistant to the chairman, a corresponding secretary, and a recording secretary. The assistant to the chairman was the active officer in the conduct of the campaign. Another important committee appointed was the distribution committee, which consisted of a chairman and six other members, one being named for each State in the district and one for the Chicago territory. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 1 CHICAGO. 441 These chairmen for the various sections secured the services of several hundred experienced bond salesmen and sent them out all over the district, building up working organizations in every section. These organizations were by counties, cities, and towns. The chairman for Chicago organized a flying squadron of several hundred volunteers and these men made an office-to-office canvass within the " loop district." Among other committees covering district-wide activities were the following: Public speakers, advertising, foreign-language papers, posters, insurance companies, churches, moving pictures and fourminute men, fraternal societies, public utilities, etc. The governors: of all five States united in issuing proclamations making one week " Liberty loan week." Partial payment plans were devised for banks and other organizations to carry those subscribers who were not prepared to meet their subscriptions in full. Secretary McAdoo visited the district during the campaign and spoke in several cities. The district's quota of bonds was oversubscribed. SECOND LIBERTY LOAN. This campaign was organized by an executive committee composed of the same members as the former executive and publicity committees and with the same chairman as the old publicity committee. Several additions were made, however, to the membership before the campaign began. An executive secretary was chosen and placed in active charge of the campaign. The active work of the campaign was carried on under the following divisions: Department of sales; department of publicity; department of public speaking; and woman's work. Additional committees covering district-wide activities were appointed as in the first campaign and the same chairmen served as before for Chicago and the various States. The unit of organization for the second campaign was the county, and this organization was subdivided so as to reach down to the city, the town, the school district, and in some cases the voting precinct. In addition thereto, all of the larger cities formed their own organizations, Volunteer workers from banks, bond houses, stock exchange firms, commercial paper houses, insurance companies, and so on, canvassed the entire district, encouraging local workers and doing pioneer work in different communities. In each State an advisory committee was formed, consisting of the Governor, the State superintendent of banks, the president of the State bankers' association and representatives of labor, religion, agriculture, commerce, industry, State council of defense and others. The district's quota of the four billions of bonds offered was oversubscribed. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

442 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. The work of the second Liberty loan campaign was. much better organized and more efficiently conducted than that of the first. It is a matter of regret that space forbids personal recognition of the many workers and instrumentalities cooperating toward the success of the two campaigns. They are numbered by the thousands. Their names are on file with the Federal Reserve Bank and the result of their effective labors will not be forgotten. A list of officers and executive committees is given in the appendix. GOVERNMENT BOND DEPARTMENT. The Federal Eeserve Bank organized a Government bond department through which the actual accounting for and distribution of Liberty bonds has been handled. A statement of the expenses of this department appears in the appendix. In the appendix will be found an exhibit of the result of both the first and second Liberty loan campaigns. TREASURY CERTIFICATES OF INDEBTEDNESS. A table showing the sales of the different issues of these certificates will be found in the appendix. WAR-SAVINGS CERTIFICATES. The Secretary of the Treasury has designated the Federal Eeserve Banks as fiscal agents for the distribution of war-savings certificates and stamps. The Federal Reserve Banks become the warehouses to which banks, express companies, railways, and other authorized agents go to receive their supplies and to whom they account for the proceeds. Up to and including December 31 the Federal Eeserve Bank of Chicago has accounted for $915,725 par value from the proceeds of these certificates. DEPOSITORIES FOR PROCEEDS OF LIBERTY BONDS AND TREASURY CERTIFICATES. Many banks throughout the district qualified as depositories under the regulations prescribed by the Treasury Department. In order to accommodate the various sections of the district, securities committees and custodians for collateral were appointed in each State, serving without compensation. A list of such securities committees and custodians appears in the appendix. CONCLUSION. The Federal Eeserve system has already justified the expectation of those who were instrumental in framing the act and responsible Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 1 CHICAGO. 443 for its enactment. Through it the reserves of the country have been largely mobilized and much of the free gold brought into its coffers. As a result of its establishment public confidence exists and the integrity of our business fabric has been maintained, although our country has entered upon what is perhaps the most momentous epoch in its history. In all this the Federal Reserve Bank of Chicago has borne its part. With all other Federal Reserve Banks its note issues have largely increased during the year. Much of this increase has been directly against gold, and the greater demands of business have necessitated the remainder. The board of directors of this bank, slow in the beginning to make use of this issue power, have not hesitated to avail themselves of it when the situation demanded, and yet further use of it will be inevitable during the continuance of the war. The problem of differentiating between necessary expansion on the one hand and dangerous inflation on the other is yet to be solved. The wise conservatism which has thus far directed the operation of the Federal Reserve Banks and the administration of the system may be trusted to handle this situation in a satisfactory manner when it is presented for solution. EXHIBIT A.—Comparative yearly statement. Dec. 31,1917. Dec. 31,1916. Bills discounted, members $105,923,175.99 $4,437,460.35 Bills discounted, bought 9,182,429.93 10,337,101.09 United States bonds and notes. 10,384,600.00 10,375,100.00 Investments 1,325,700.88 Total. 125,490,205.92 26,475,482.32 —; ; - — -, Interest accrued on United States bonds and notes 63,695.00 50,896.48 l P i r b e e m rt i y u m lo a o n n b U o n n i d te s— d S $1 ta 0 t - e p s a r b t a ic n i d p s ation certificates "163,166.66 193,311.66 Furniture and fixtures 28,304.53 Cost of unissued Federal Reserve notes - 67,957.83 Due from member banks, overdrafts - 330,615.85 1,723.57 Due from Federal Reserve Banks 5,992, 720.41 29,913,819.08 Federal Reserve Banks, transfers bought 8,178,412.26 Transit and exchanges for clearing house 19,868,657.09 "*4,'692,*553."7i Federal Reserve and national bank notes .*. 10,635,500.00 2,986,185.00 Gold coin and gold certificates 32,189,305.00 27,600,625.00 Bank of England sterling gold account 7,350,000.00 Other lawful money 963,872.27 396," 102." 95 Gold settlement fund 58,960,460.00 26,183,000.00 Gold with Federal Reserve agent 130,723,530.00 Five per cent redemption fund 646,490.00 200,000.00 Total cash reserve 230,833,657.27 54,379,727.95 Other assets 349,181.34 401,905,745.14 118,789,962.13 34365°—I Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

444 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. EXHIBIT A.—Comparative yearly statement—Continued. Dec. 31, 1917. Dec. 31,1916. LIABILITIES. Capital paid in $9,091,700.00 1,683,550.00 Surplus 215,799.18 Profit and loss " 61,* 978.07 Discount on United States bonds 77,603.50 Unearned discount 318,087.33 46,451.23 Unearned interest—investments 6,051.22 Reserved for sundry expenses 4,833.62 5,391.08 Difference account , 254.61 Federal Reserve notes outstanding 190,788,530.00 Federal Reserve bank drafts , 1,471,347.45 Liberty loan—$10-partieipation certificates sold. 163,100.00 Uncollected funds 18,183,306.82 United States Government deposits 3,052,436.84 2,045,784.95 Due to Federal Reserve Banks 6,165,983.77 14,550,742.93 Due to member banks—reserves 169,174,348.05 95,390,012.65 Due to nonmember clearing banks 3,198,413.97 401,905,745.14 118,789,962.13 Gold reserve against net deposit liabilities (per cent) 59.2 69.8 Cash reserve against net deposit liabilities (per cent) 59.7 70.3 Gold reserve against Federal Reserve notes in circulation (per cent). 72.7 158.0 EXHIBIT B.—Earnings and expenses for calendar year 1917; also profit and loss on Dec. SI, 1917. Earnings for 1917, as shown on Form 95 $2, 020, 714.10 Net service charges in excess of transit department disbursement 1, 564. 00 Total $2,022,278.10 Expense of operation of bank proper 320, 357. 29 Cost of Federal Reserve currency issued (including expressage, insurance, etc.) 157,510.57 Cost of Federal Reserve currency unissued, charged off 43, 001. 01 Miscellaneous charges account note issues 2, 314.11 Depreciation on furniture and equipment 32, 225. 53 Depreciation United States bonds 237,118. 24 Total 792, 526. 75 Net earnings for year 1, 229, 751. 35 Profit and loss, Jan. 1, 1917 61, 978. 07 Amount paid by Federal Reserve Bank, Minneapolis, Jan. 30, 1917, to equalize stock of said bank transferred to Federal Reserve Bank of Chicago capital stock 2,127. 22 Total 1, 293, 856. 64 Dividends paid: Date paid June 29, 1917, period covered Jan. 1, 1916, to June 30, 1916, inclusive, amount $205, 710. 22 Date paid Dec. 28, 1917, period covered July 1, 1916, to Dec. 31, 1917, inclusive, amount 654, 347. 08 Interest paid on stock surrendered 2, 200. 98 862, 258. 28 Profit and loss—Dee. 31, 1917. 431, 598. 36 Distribution of profit and loss: One-half of balance Dec. 31, 1917, remitted to United States Treasury—franchise tax paid United States Government 215, 799.18 One-half of balance transferred to surplus fund 215,799. 18 431, 598. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. "7—CHICAGO. 445 EXHIBIT C.—Transactions through the gold-settlement fund weekly. [000's omitted.] Week ending— Debits. Credits. Balance. 1917. Jan. 3 $36,705 $29,668 $33,220 Jan.10 42,545 43,911 31,854 Jan. 17 39,225 36,097 34,982 Jan. 24 38,210 39,688 33,504 Jan. 31 42,329 36,913 38,920 Feb.7 40,607 42,929 36,598 Feb.14 38,004 34,554 40,048 Feb. 21 32,352 39,706 32,694 Feb. 28 41,375 29,686 44,383 Mar. 7 43,094 40,391 47,086 Mar. 14 33,111 32,704 47,493 Mar. 21 36,584 40,207 43,870 Mar. 28 32,368 41,109 35,129 Apr. 4 33,794 35,466 33,457 Apr. 11 45,617 42,095 36,979 Apr.18 52,304 48,531 40,752 Apr. 25 46,735 65,540 21,947 May2 68,944 57,446 33,445 MayQ 59,718 68,082 25,081 May 16 75,741 70,614 30,208 May 2? 59,791 53,417 36,582 May SO 58,235 67,661 27,156 June 6 53,944 45,587 35,513 June 13 60,305 72,705 23,113 June 20 85,672 85,008 23,777 June 27 76,628 61,133 39,272 Subtotal 1,273,937 1,260,848 July 4 87,051 54,661 71,662 July 11 87,111 84,045 74,723 July 18 69,563 85,890 58,401 July 25 105,694 111,159 52,936 Aug.l 72,032 99,326 25,642 Aug. 8 "80,092 60,819 44,915 Aug. 15 72,749 77,592 40,072 Aug. 22 75,508 67,984 47,596 Aug. 21 79,741 66,681 60,656 Sept. 5 76,009 56,454 80,211 Sept. 12 94,597 104,320 70,488 Sept. 19 77,424 92,864 55,0 43 Sept. 26 97,064 100,034 52,078 Oct. 3 80,385 98,027 34,436 Oct. 3 0 96,884 76,345 54,975 Oct.17 92,012 80,947 66,040 Oct. 24 113,536 107,828 71,748 Oct. 31 102,053 126,580 47,221 Nov. 7 119,920 107,316 59,825 Nov. 14 102,504 103,579 58,750 Nov. 21 173,061 166,149 65,662 Nov. 28 125,307 125,771 65,198 Dec. 5 107,425 110,780 61,843 Dee. 12 98,909 101,001 59,751 Dec. 19 155,930 157,816 57,865 Dec. 26 124,405 132,109 50,161 Total 3,840,903 3,816,925 Total, 1916 798,567 774,570 Increase, 1917 3,042,336 3,042,355 EXHIBIT D.—Federal Reserve notes. Notes outstanding Dec. 31, 1916: 683,839 fives $3,419, 195 67,780 tens 677, 800 125,850 twenties 2, 517, 000 3,490 fifties 174, 500 3,950 hundreds 395, 000 $7, 183, 495 Notes issued to bank during year 1917: 3,496,000 fives 17,480,000 6,924,000 tens 69, 240, 000 4,004,000 twenties 80,080,000 228,000 fifties 11, 400, 000 104,000 hundreds 10, 400, 000 188, 600, 000 Total 195, 783, 495 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

446 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. Notes retired during year 1917 : 350,829 fives $1, 754, 145 147,853 tens 1 478,530 76,212 twenties 1,524,240 3,923 fifties 196, 150 419 hundreds 41, 900 $4, 994, 965 Notes outstanding Dec. 31, 1917 190, 788, 530 Notes outstanding Deo. 31, 1917: 3,829,010 fives 19,145,050 6,843,927 tens 68,439,270 4,053,638 twenties 81, 072, 760 227,567 fifties 11,378,350 107,531 hundreds 10, 753, 100 190, 788, 530 Total notes retired since organization : 626,990 fives 3,134,950 156, 073 tens 1, 560, 730 86,362 twenties 1, 727, 240 4,433 fifties 221,650 469 hundreds 46, 900 6, 691, 470 Total notes returned to agent since organization : Unfit notes—128,000 fives 640,000 Fit notes— 10 fives 50 30 twenties 600 5 fifties 250 1 hundred 100 641, 000 198, 121, 000 Total notes issued and reissued since organization : 4,584,010 fives 22, 920, 050 7,000,000 tens 70,000,000 4,140,030 twenties 82,800,600 232,005 fifties 11, 600, 250 108,001 hundreds 10, 800, 100 198, 121, 000 Total notes on hand by agent Dec. 31, 1917 : 1,236.000 fives 6, 180, 000 760,000 tens 7,600,000 716,000 twenties 14,320,000 100,000 fifties 5, 000, 000 44,000 hundreds 4, 400, 000 = 37, 500, 000 EXHIBIT E.—Member banks in seventh Federal Reserve district to whom permits have been granted for the exercise of trust powers. Date of City. State. Name of bank. permit. Anderson Indiana. Peoples State National Bank June 8, 1915 Batesville .do.. First National Bank Sept, 13, 1916 Battle Creek Michigan Central National Bank Oct. 6, 1917 Do do.. Old National Bank Apr. 29, 1915 Bay City do First National Bank Apr. 13, 1915 Beaver Dam j Wisconsin Old National Bank Apr. 29, 1915 Belvidere j Illinois Second National Bank Do. Benton Harbor ! Michigan Farmers & Merchants National Bank Aug. 18, 1917 Birmingham i do First National Bank Sept. 22, 1917 Bloomington j Illinois State National Bank Jan. 18, 1916 Boone ! Iowa First National Bank Oct. 9, 1916 Boyne City ! Michigan. .do. June 1, 1915 Brazil Indiana < do.. Oct. 13, 1916 Do .do. Riddell National Bank Apr. 29, 1915 Brookville do Franklin County National Bank. Sept. 30, 1915 Do do National Brookville Bank Aug. 23, 1916 Casey Illinois First National Bank Dec. 30, 1915 Cedar Rapids Iowa Cedar Rapids National Bank May 9, 1916 Do do Merchants National Bank Apr. 24, 1915 Chicago Illinois National City Bank Aug. 9, 1915 Clarence Iowa First National Bank Apr. 19, 1916 Clinton do City National Bank Nov. 8, 1915 Coon Rapids do First National Bank Dec. 29, 1916 Council Bluffs do City National Bank June 8, 1915 Do do First National Bank Mar. 9, 1917 Crawfordsville Indiana Citizens National Bank May 5, 1917 Decatur Illinois Millikin National Bank Jan. 18, 1916 Deeorah... Iowa National Bank of Decorah Sept. 20, 1917 Des Moines do Des Moines National Bank July 20, 1916 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. "7—CHICAGO. 447 EXHIBIT E.—Member banks in seventh Federal Reserve district to tvhom permits have been granted for the exercise of trust powers—Continued. Date of City. State. Name of bank. permit. Dubuque Iowa First National Bank May 5, 1917 Dyer Indiana... do June 8, 1915 Emmetsburg Iowa Emmetsburg National Bank May 5, 1917 Flint Michigan.. First National Bank Dec. 26, 1917 Fonda Iowa. .do.. July 26, 1915 Franklin Indiana... Franklin National Bank. Do. Freeport Illinois First National Bank Apr. 26, 1915 Gladbrook Iowa. .do.. Aug. 27, 1917 Grand Rapids Michigan.. Old National Bank... Apr. 29, 1915 Greencastle Indiana.. First National Bank, Oct. 9, 1916 Humboldt Iowa. .do Jan. 18, 1916 Independence do ..do.. Aug. 26, 1915 Indianola .do ..do... Jan. 18, 1916 Janesville Wisconsin.. ...do May 5, 1915 J oliet Illinois .do.. Apr. 15, 1915 Kanawha Iowa. .do.. Jan. 25, 1917 Kokomo Indiana... Citizens National Bank.. Jan. 26, 1916 Bo .do.. Howard National Bank. Aug. 26, 1915 Lansing Michigan.. Capital National Bank.. Aug. 15, 1917 La Porte Indiana.., First National Bank June 8, 1915 LeMars Iowa. do.. July 20, 1916 Liberty Indiana... Union County National Bank. June 4, 1915 Logansport do First National Bank Oct. 13, 1916 Macomb Illinois Union National Bank Apr. 13, 1915 Manchester Iowa First National Bank Dec. 1, 1917 Marengo .do.. do Oct. 9, 1916 Marion Indiana. Aug. 26, 1915 Do do..., Marion National Bank Feb. 21, 1916 Marseilles Illinois., First National Bank Apr. 13, 1915 Mattoon do.. National Bank of Mattoon. Dec. 29, 1915 Michigan City Indiana Merchants National Bank.. Oct. m, 1916 Mishawaka do First National Bank Mar. 7, 1917 Monroe Wisconsin.. .do Apr. 29, 1915 Monrovia Indiana. ..do.. Oct. 6, 1917 Montezuma Iowa ..do., Oct. 9, 1916 Moweaqua Illinois.. .do.. Jan. 17, 1916 Muncie Indiana. Merchants National Bank. Mar. 14, 1917 Odebolt Iowa. First National Bank Sept. 13, 1915 Oskaloosa .do Oskaloosa National Bank.. Jan. 17, 1916 Peterson .do First National Bank Aug. 10, 1916 Petoskey.... Michigan.. .do Dec. 2, 1915 Port Huron .do .do.. Feb. 23, 1916 Red Oak Iowa. ..do.. June 15, 1917 Richmond Indiana. ..do.. Apr. 29, 1915 Do do.. Second National Bank. Apr. 24, 1915 Rochester do First National Bank Oct. 18, 1916 Do Michigan.. .do.. July 26, 1915 Rockford Illinois Rockford National Bank June 1, 1915 Do .do.. Third National Bank Apr. 29, 1915 Rockville Indiana. Rockville National Bank June 8, 1915 Rushville do... Rush County National Bank.. Apr. 13, 1915 Do do Rushville National Bank June 8, 1915 Russiaville do First National Bank Apr. 29, 1915 St. Clair Heights Michigan., Michigan National Bank Feb. 21, 1916 Saginaw .do.. Second National Bank Apr. 15, 1915 Sheridan Indiana... Farmers National Bank Apr. 7, 1916 Do do First National Bank Dec. 27, 1916 Sibley Iowa. .do Apr. 13, 1915 Sioax Rapids do .do.. Mar. 28, 1916 South Bend Indiana... do Feb. 21, 1916 S S t to an ry to C n ity Iowa d . o.... .d d o o .. J A u u n g e . 8 9 , , 1 19 9 1 1 6 5 Tipton Indiana.. Citizens National Bank Sept. 13, 1915 Traverse City Michigan., First National Bank Nov. 8, 1915 Valparaiso Indiana.. Farmers National Bank, May 14, 1915 Wabash do... Farmers & Merchants National Bank. Dec. 2, 1915 Waterloo Iowa. Commercial National Bank Aug. 9, 1915 Do.... do Leayitt & Johnson National Bank Dec. 29, 191f> Waukesha Wisconsin.. National Exchange Bank Apr. 24, 1915 Waverly Iowa First National Bank June 15, 1917 Webster City..; do Farmers National Bank June 8, 1915 Whiteland Indiana Whiteland National Bank Nov. 25, 1916 Wilkinson ....do Farmers National Bank July 1, 1915 NOTE.—National banks in the State of Illinois are not as yet exercising trust powers. It is understood that the supreme court of the State is shortly to pass on a test case now pending, to determine whether the State laws permit the exercise of such powers by national banks. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

448 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. EXHIBIT F.—State member banks in seventh Federal Reserve district. Austin State Bank, Chicago. Central Trust Co. of Illinois1 (1914), Chicago. Chicago Savings Bank & Trust Co., Chicago. First Trust & Savings Bank, Chicago. Foreman Bros, Banking Co., Chicago. Harris Trust & Savings Bank, Chicago. Hyde Park State Bank, Chicago. Kaspar State Bank, Chicago. Merchants' Loan & Trust Co., Chicago. Noel State Bank, Chicago. Standard Trust & Savings Bank, Chicago. State Bank of Chicago, Chicago. Union Trust Co., Chicago. United State Bank, Chicago. Kirchman State Bank, Cicero. Elmhurst State Bank1 (1915), Elmhurst. State Bank of Evanston, Evanston. Commercial Trust & Savings Bank1 (1915), Joliet. Joliet Trust & Savings Bank, Joliet. Union State Savings Bank & Trust Co., Kewanee. Mq^tinsville State Bank,2 Martinsville. Suburban Trust & Savings Bank, Oak Park. St. Joseph Valley Bank, Elkhart. Discount & Deposit State Bank, Kentland. IOWA. Security Trust & Savings Bank, Cedar Falls. Peoples' Trust & Savings Bank, Clinton. Iowa Loan & Trust Co., Des Moines. Citizens' Savings Bank, Gilman. Commercial Savings Bank, Mason City. Ottumwa Savings Bank, Ottumwa. Bankers' Loan & Trust Co.,1 (1916), Sioux City. First Savings Bank,3 Sutherland. Farmers State Bank,2 Vail. MICHIGAN. Commercial & Savings Bank1 (1915), Albion. Eaton County Savings Bank, Charlotte. American State Bank,2 Detroit. Central Savings Bank, Detroit. Detroit Savings Bank, Detroit. Dime Savings Bank, Detroit. First State Bank, Detroit. 1 Banks which joined the system before 1917. 2 Banks approved ; capital and reserve not paid. 8 Banks approved; capital paid, reserve not paid. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 1 CHICAGO. 449 Peoples State Bank, Detroit. Wayne County & Home Savings Bank, Detroit. Peninsular State Bank,1 Detroit. Citizens Commercial & Savings Bank, Flint. Industrial Savings Bank, Flint. Union Trust & Savings Bank, Flint. Old State Bank,2 Fremont. Grand Haven State Bank, Grand Haven. Grand Rapids Savings Bank, Grand Rapids. Kent State Bank, Grand Rapids. Oceana County Savings Bank,2 Hart. Highland Park State Bank, Highland Park. Boies State Savings Bank, Hudson. Central State Bank, Jackson. Union Bank, Jackson. Lansing State Savings Bank,2 Lansing. Lapeer Savings Bank, Lapeer. B. Dansard & Sons State Bank,1 Monroe. Exchange Savings Bank, Mount Pleasant. Niles City Bank, Niles. H. C. McLachlin & Co. State Bank, Petersburg. St. Clair County Savings Bank, Port Huron. Rochester Savings Bank,2 Rochester. Romeo Savings Bank, Romeo. Fruit Growers State Bank3 (1915), Saugatuck. Commercial & Savings Bank,2 St. Clair. WISCONSIN. Citizens Bank, Clinton. Bank of Wisconsin3 (1914), Madison. American Exchange Bank,2 Milwaukee. Badger State Bank3 (1915), Milwaukee. Marshall & Ilsley Bank, Milwaukee. Banks admitted previous to 1917: Illinois 3 Iowa 1 Michigan 2 Wisconsin 2 Total 8 Banks admitted during 1917: Illinois 19 Indiana^ 2 Iowa 8 Michigan 31 Wisconsin 3 Total . 63 Total State banks in Federal Reserve system, 71. Applications in process of examination, 22. 1 Banks approved; capital paid, reserve not paid. 2 Banks approved; capital and reserve not paid. Digitized for FRASER 3 Banks which joined the system before 1917. http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

450 ANNUAL KEPORT OF THE FEDERAL RESERVE BOARD. EXHIBIT G.—Liberty loan. PIKST LIBERTY LOAN, SUBSCRIPTIONS BY STATES. Illinois $197, 315,150 Indiana 35, 323. 100 Iowa 31, 343, 850 Michigan 62, 538, 800 Wisconsin 30, 866, 100 Total 357, 387, 000 Allotment by States 1 Not available. Allotment for district $272,202,100 Number of subscribers Not available. Number of banks subscribing About 4, 000 UNITED STATES GOVERNMENT LIBERTY LOAN BOND PARTICIPATION CERTIFICATES. The Federal Eeserve Bank of the seventh district issued $1,000,000 of the above certificates, subscribing for $1,000,000 of bonds to be used in redemption thereof. The purchaser of five of these certificates was privileged to exchange them for a $50 bond. Second Liberty loan subscriptions, allotments, and subscribers, by States. Subscrip- Subscript m io e n m s b b e y r n t o io n n m s e b m y - s T c o ri t p al t i s o u n b s - . Allotment. sc S ri u b b e - rs. banks. ber banks. Illinois $92,927,150 $151,275,650 $244,202,800 $206,121,800 451,152 Indiana 35,895,350 33,457,350 69,352,700 67,047,100 172,124 Iowa 37,018/200 45,841,650 82,859,850 79,857,550 247,167 Michigan . 68,296,750 37,765,700 106,062,450 95,473,650 323,227 Wisconsin 50,199,750 27,494,550 77,694,300 72,809,300 ]98,551 Filed "by individuals and corporations direct with Federal Reserve Bank.. 5,681,250 5,681,250 4,741,450 4.981 Total 284,337,200 301.516,150 585/853,350 526,050,850 1,397,202 NOTE.—$450,473,740 had been paid in on the above allotment of $526,050,850 up to and including Dec. 31, 1917. Expense of the first Liberty loan of 1917 incurred up to and including Dec. 31, 1917. j Telephone Printing, Postage. and Salaries. Traveling.stationery, Express- 1 telegraph. and minor age. supplies. Bond department $10,681.02 | $6,995.25 $80,254.73 $616.55 $15,944.72 $385.39 Publicity and distribution committees 1,564.44 1 1,538.90 2,337.25 11,327.61 19,378.47 675.33 Total 12,245.46 8,534.15 82,591.98 11,944.16 35,323.19 1,060.72 1 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 7—CHICAGO. 451 Expense of the first Liberty loan of 1917 incurred up to and including Dec. 31, 1917—Continued. Supper Furniture money, Misceland equip- Rent. account laneous. Total. ment. overtime work. Bond department $4,604.58 $651.65 $2,053.65 $14,001.32 $136,188. 86 Publicity and distribution committees. 44.00 6.00 10,086. 78 46,958.78 Total. 4,604.58 695.65 2,059. 65 24,088.10 183,147.64 Total expense $183,147.64 Reimbursed from the Treasury Department up to and including Jan. 3,1918 169,417.34 Balance due from Treasury Department 13,730.30 AVERAGE NUMBER OF EMPLOYEES DURING THE FIRST LIBERTY LOAN CAMPAIGN IN CHICAGO. Bond department 125 Publicity and distribution committees 25 Total 150 Expense of the second Liberty loan of 1911 incurred up to and including Dec. 81, 1911. Telephone Printing, Furniture Postage. tele a g n r d aph. o S v a e a l r n a ti r d m ies e. Traveling.a S s n t u d a p t i p m o l n i i e e n s r o . y r Ex a p g r e e . ss- e m q a e u n n i d p t. - Bond department: $6,991.59 $500.97 $75,378.05 $11,863.29 $591.75 $10,154.35 Executive committee 2,746.66 10.00 13,457.88 $142.35 1,816.53 181.50 238.00 Publicity committee 1,345.24 357.41 14,196.87 584.06 44,214.18 289.05 4,933.25 Public speaking corn- 64.26 48.97 808.10 1,480.89 198.67 3.00 20.06 941.99 300.09 1,405.32 10.00 Chicago committee 1,532.38 10,605.83 4.20 3,813.92 27.25 58.50 Illinois committee 99.03 3*45* 279.52 101.82 334.78 Indiana committee 18.24 156.45 Iowa committee 245.36 14.85 741.66 259.81 W Mi i c s h co ig n a s n in c o co m m m m it i t t e te e e ... 5 4 2 7 0 1 . . 6 9 4 3 248.57 1,496.67 7,222.25 3 1 0 1 8 2 . . 5 5 4 8 Total.. 14,055.39 1,184.22 117,905.91 9,835.66 64,484.07 1,102.55 15,384.10 Magazines, Rent. pap n e e r w s s a - nd la M n i e s o ce u l s - . Subtotal. tr U ib n u d t i e s- d. G to r t a a n l d . directories. Bond departmentJ $2,985.00 $30.00 $4,846.20 $113,341.20 $113,341.20 Executive committee 450.00 2.00 459.49 19,504.41 19,504.41 Publicity committee 490.00 1,410.50 26,417.86 94,238. 42 94,238.42 Public speaking committee 1,774.86 4,378.75 4,378.75 Women's committee 86.00 305. 20 3,068.66 3,068.66 Chicago committee 1,642.20 36.00 2,603.12 20,323.40 *8,000.00 28,323.40 Illinois committee 818.60 8,000.00 8,818.60 Indiana committee 174.69 9,742.40 9,917.09 Iowa committee ' 32.40 • 1,293.42 8,322. 53 9,615.95 Michigan committee 1 86.06 9,882.73 2,419.04 ' 12,301.77 Wisconsin committee ' 584. 51 18,011.83 18,596.34 Total 5 653.20 1,478.50 36,525.19 267,608.79 54,495.80 322,104.59 1 Bond department includes depositary bank department, fiscal agent department, etc., excluding various Liberty loan committees. NOTE.—Up to and including Jan. 3, 1918, we have not received reimbursement from the Treasury Department for any of the above expense. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

452 REPORT OF THE FEDERAL RESERVE BOARD. Number of employees in the service of the bond department arid various Liberty loan committees in Chicago at the present time, and average number employed during the second Liberty loan campaign. Present number (as of Average. Dec. 31, 1917). Bond department 166 188 Executive committee 14 28 Publicity: Publicity committee 4 20 Publicity mailing 4 120 8 140 Public speaking committee 4 Women's committee . . . 10 Chicago committee 16 66 Illinois committee 10 Indiana committee 10 Iowa committee 8 Michigan committee 1 3 Wisconsin nnmniittee _, . . . ,,_.,., 4 Total 205 471 Expense of various issues of certificates of indebtedness incurred up to and including Dec. 31, 1917. Applicable to first Liberty loan of 1917 : $200,000,000 certificates of indebtedness (3 per cent) dated Apr. 25, 1917; due June 30, 1917 $431.42 $200,000,000 certificates of indebtedness (3 per cent) dated May 10, 1917; due July 17, 1917 703.20 $200,000,000 certificates of indebtedness (3i per cent) dated May 25, 1917; due July 30, 1917 236.92 $200,000,000 certificates of indebtedness (3J per cent) dated June 8, 1917 ; due July 30, 1917 61. 93 $1, 433. 4T Applicable to second Liberty loan of 1917: $300,000,000 certificates of indebtedness (3| per cent) dated Aug. 9, 1917; due Nov. 15, 1917 299.89 $250,000,000 certificates of indebtedness (3J per cent) dated Aug. 28, 1917 ; due Nov. 30, 1917 549. 37 $300,000,000 certificates of indebtedness (3i per cent) dated Sept. 17, 1917; due Dec. 15, 1917 403.98 $400,000,000 certificates of indebtedness (4 per cent) dated Sept. 26, 1917; due Dec. 15, 1917 426.34 $300,000,000 certificates of indebtedness (4 per cent) dated Oct. 18, 1917; due Nov. 22, 1917 330.02 certificates of indebtedness (4 per cent) dated Oct. 24, 1917; due Dec. 15, 1917 292.99 certificates of indebtedness (4 per cent) dated Nov. 30, 1917; due June 25, 1918 220.90 2 2, 523. 49 Total 3, 956. 96 xWe have received reimbursement from the Treasury Department for this amount. 2 Amount due from Treasury Department as of Jan. 3, 1918. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 7 CHICAGO. 453 EXHIBIT H.—Certificate of indebtedness department. Numi D ss a u t e e . d D a u te e . d C a a t l e l . c P e e n r t. Total issue. Su t b i s o c n r . ip- m Al e l n o t t . - s b s c u e r r b i - b o - f ers. Certificates issued to Federal Reserve Banks onlv Mar. 31 June 29 2 $50,000,000 $5,000,000 $5,000,000 1 Ce a L r n t i i b t f i i e c c r i a t p t y e a s t l i o o i a s n n s u o e f d f i i n rst A M J M u p a a n r y y e . 2 1 2 8 5 0 5 J J J u u u n l l d y y e o 3 3 1 .. 0 0 7 .. 3 3 3 3 i 1 2 2 2 2 6 0 0 0 8 0 0 0 , , , , 2 0 0 0 0 0 0 0 5 0 0 0 , , , , 0 0 0 0 0 0 0 0 0 0 0 0 2 2 2 1 4 3 3 6 , , , , 8 1 2 4 9 1 1 0 3 7 5 0 , , , , 0 0 0 0 0 0 0 0 0 0 0 0 2 1 1 1 4 6 6 9 , , , , 8 4 6 8 9 0 0 0 0 3 0 0 , , , , 0 0 0 0 0 0 0 0 0 0 0 0 4 2 5 1 1 0 9 3 9 3 1 5 Total 868,205,000 87,625,000 77,693,000 1,348 Aug. 9 Nov. 15 3| 300,000,000 18,870,000 15,600,000 381 Ce a o r n n ti t d f i i c c L i a p i te a b t s e i r o i t s n y s u o l e o f d a s n i e n . c . - . 1 A S O S e e u c p p g t. t . t . . 1 2 2 1 8 8 6 7 .. D N N . e . o o d c v v . o . . . 1 3 2 - 5 0 2 .. D D e e c c . . 1 6 1 3 3 4 4 | i 2 3 4 3 5 0 0 8 0 0 0 5 , , , , 0 0 0 1 0 0 0 9 0 0 0 7 , , , , 0 0 0 0 0 0 0 0 0 0 0 0 3 3 2 1 5 2 1 8 , , , , 6 9 1 6 2 8 6 3 9 3 6 9 , , , , 0 0 0 0 0 0 0 0 0 0 0 0 3 3 2 1 5 2 1 5 , , , , 6 9 1 0 2 6 6 9 9 3 9 5 , , , , 0 0 0 0 0 0 0 0 0 0 0 0 3 8 5 7 0 7 9 4 4 9 5 5 Oct. 24 Dec. 15 4 685,296,000 18,141,000 18,141,000 217 Total 2,320,493,000 145,408,000 138,597,000 3,121 Certificates issued in anticipation of taxes Nov. 30 June 25 4 691,622,000 30,139,500 30,139,500 89 FEDERAL RESERVE BANK SUBSCRIPTIONS. Mar. 31 $5,000,000 Aug. 9 1,000,000 Aug. 28 1,000,000 Sept. 17 2,060,000 Sept. 26 - 5,150,000 Oct. 18 250,000 Oct. 24 CERTIFICATES OF INDEBTEDNESS. 3 per cent 3 per cent S\ per cent 3§ per cent issue of Apr. issue of May issue of May issue of June Total. 25-June 30. 10-July 17. 25-July 30. 8-July 30. 11 £ a> I" 3 I-8 !.§ I < 25,000 or less 70| $1,280,000 $4,631,000 $2,380,000 325 $3,583,000 1,033 $11,874,000 25,000 to 50,000.... 22! 1,020,000 1,545,000 1,274,000 50 2,234,000 137 6,073,000 50,000 to 100,000... 13} 1,235,000 2,312,000 1,490,000 23 2,143,000 77 7,180,000 100,000 to 250,000.. 17) 3,650,000 2,825,000 1,545,000 6 1,300,000 45 9,320,000 250,000 to 500,000.. 8i 3,600,000 2,410,000 3,300,000 10 3,915,000 34 13,225,000 500,000 to 1,000,000 5| 5,615,000 11,170,000 6,611,000 5 6,625,000 22 30,021,000 Total 135! 16,400,000 50324,893,000 291 16,600,000 419 19,800,0001,348 77,693,000 Issue of Aug. 9. Issue of Aug. 28. Issue of Sept. 17. Issue of Sept. 26. Num- Num- Num- Numb s s c e u r r b i b o - - f A al m lo o tt u e n d t . b s s c e u r r b i b o - - f A al m lo o tt u e n d t . b s s c e u r r b i b - o - f A al m lo o tt u e n d t . b s s c e u r r b ib o - - f A al m lo o tt u e n d t . ers. ers. ers. ers. 1,000 to 25,000..... $3,736,000 297 $3,429,000 508 $5,214,000 647 $6,743,000 26,000 to 50,000.... 2,204,000 46 2,042,000 45 2,055,000 91 3,933,000 51,000 to 100,000... 1,475,000 14 1,350,000 16 1,575,000 30 2,714,000 101,000 to 250,000.. 2,710,000 14 2,303,000 16 2,938,000 16 3,180,000 251,000 to 500,000.. 750,000 4 1,601,000 5 2,400,000 8 3,040,000 501,000 to 1,000,000 2,475,000 2 1,290,000 2 2,000,000 7 4,835,000 1,001,000 and over. 2,250,000 2 3,080,000 3 4,987,000 5 11,184,000 Total 381 15,600,000 379 15,095,000 595 21,169,000 804 35,629,000 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

454 REPOET OF THE FEDERAL RESERVE BOARD. EXHIBIT H.—Certificate of indebtedness department—Continued. CERTIFICATES OF INDEBTEDNESS—Continued. Issue of Oct. 18. Issue of Oct. 24. Total. Num- Num- Numb s s c e u r r b i - b o - f A al m lo o tt u e n d t . i j ! s s b c u e r r b i b - o - f A al m lo o tt u e n d t . b s s c e u r r b i - b o - f a A l m lo o tt u e n d t . ers. ers. 1,000 to 25,000 588 $6,706,000 164 $1,810,000 2,500 $27,048,000 26,000 to 50,000 85 3,670,000 20 817,000 330 14,721,000 51,000 to 100,000... 36 3,302,000 12 1,130,000 123 11,546,000 101,000 to 250,000.. 13 2,585,000 1,445,000 81 15,161,000 251,000 to 500,000.. 14 6,100,000 2,239,000 39 16.130,000 501,000 to 1,000,000 7 6,600,000 4,700,000 26 2i;900,000 1,001,000 and over. 2 4,000,000 6,000,000 10 31,501,000 Total 32,903,000 18,141,000 I o,121 138,597,000 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 8.—ST. LOUIS. WILLIAM MCC. MARTIN, Chairman and Federal Reserve Agent. FINANCIAL RESULTS OF OPERATION. For the months of January, February, March, and April, 1916, the Federal Reserve Bank of St. Louis showed no net earnings, but in May of that year the earnings were $1,888.47, and from that date steadily increased month by month until in December, 1916, the net earnings amounted to $23,191.18. For the month of January, 1917, the earnings amounted to $18,- 971.82, and from that figure they steadily increased throughout the entire year. In this connection, it must be remembered that in this district January, February, March, and frequently April, are the lean months, and it must also be borne in mind that war was not declared until April of this year. It is therefore reasonable to presume that the earnings for these first four months in 1917 were not due especially to abnormal conditions but, it would seem, were due more particularly to the fact that banks had begun to realize how easily they could do business with the Federal Reserve Bank and were using its facilities. Attached hereto, as Exhibit A. is a statement showing earnings and expenses, by months, for the years 1916 and 1917. This shows that during the year 1917 the percentage of expenses to earnings has decreased from 39.58 per cent to 25,93 per cent. In 1917 the earnings of the Federal Reserve Bank of St. Louis amounted to $738,713.38, and the expenses of the bank were $236,- 557.34, leaving net earnings of $502,156.04. On March 31, 1917, the bank paid a dividend for the period from April 1, 1915, to June 30, 1915, and on June 30, 1917, it paid a dividend for the period from July 1, 1915, to December 31, 1915. On December 31 of this year the bank paid a dividend for the year 1916. This left a balance in the profit and loss account of $230,338.58. COMPARATIVE BALANCE SHEETS FOR DECEMBER 31, 1916 AND 1917. These comparative balance sheets, which are attached to this report as Exhibit B, disclose an increase in the earning assets of this bank 455 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

456 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. of $32,988,518.58. Last year a comparison of the balance sheets of 1915 and 1916 showed a large increase in earning assets of all classes of investments, excepting bills discounted for member banks. This year, as compared with 1916, the balance sheet shows a large increase in all items excepting that of municipal warrants. In 1916 the principal source of income was open-market purchases of bankers' acceptances. During this year the largest source of income has been from bills discounted for member banks, in which there has been a very large increase. An increase is shown in capital, due in large measure to the admission of State banks into the system. There is also a large increase in deposits, both gross and net. PROFIT AND LOSS STATEMENT FOR YEARS 1916 AND 1917. During 1917 the earnings from bills discounted for member banks were much larger than those from any other source. The percentage of earnings derived from the various sources for 1916 and 1917 are as follows: 1916 1917 Bills discounted for other Federal Reserve Banks . 1 Bills discounted and loans to member banks 47 Acceptances 23 Municipal warrants Interest on United States securities Transfers bought United States securities, profit and appreciation.. Sundry 4 Total - 100 100 Attached hereto as Exhibit C is a comparative profit-and-loss statement covering the years 1916 and 1917. GENERAL BUSINESS AND BANKING CONDITIONS IN THE DISTRICT. During 1916, from month to month, business steadily increased until at the end of the year it was at an extremely high level. Prices also steadily increased, but at the end of the year they had not reached a point which had curtailed demand. It continued steady for both luxuries and necessities. During the early part of 1917, business continued unabated and was not affected by the usual after Christmas dullness. However, in the early months of 1917, what we may call unrestrained buying wThich was in evidence in the latter part of 1916, began to lessen, and by the latter part of February buj^ers began to discriminate. Prices made them pause a little, both buyer and seller became more conservative, and speculative buying in this district was about elimi-' nated. However, the buying power of the public continued very Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT ETO. 8—ST. LOUIS. 457 large, especially in those sections of this district contiguous to Little Rock and Memphis. During April, 1917, business, while still active, did not increase in the same ratio as in the past months. Reports from different houses throughout the district in describing their business, spoke of it as " good " and " extremely active," although on closer analysis it would seem that while business houses were doing a large business as measured by amounts, it was not so large when measured by the number of transactions. In other words, there were not as many buyers, but those who bought paid more for the product. This country was declared to be at war with Germany in April, 1917, but business seemed to have discounted the emergency and was well prepared. It continued during May at a high level, its tone being one of conservatism, with a strong underlying feeling of confidence. A scarcity of canned goods became apparent and also a scarcity of sugar. Building began to show the high cost of material, and while it had never been as active during the previous months as other lines, it nowT began to fall off perceptibly. During June, July, and August the war showed its sobering effect, and reports from throughout the district Showed a quieter condition in practically all lines, except munitions. Business was operated on a conservative basis during these months. While the volume of sales in wholesale lines continued to be large, they showed smaller increases than for the previous months. The demand for merchandise from dry-goods jobbers became less than it had been for a number of months previous. Prices continued to increase, and showed a decided effect on such articles as the public could conveniently do without. Previous to this the prices of luxuries had made the public pause, but now they began to make them stop buying. Doubtless the campaign for economy, which was then beginning, also had its effect. However, business held up well, and collections were good. During the latter months of the year business in general has been active, the increase in dealings for supplies necessary for war bringing up the average. In October wholesalers and jobbers reported that they were doing a large business, and the consumption of goods was indicated rather than the accumulation of stocks in the hands of the retailer. This year the wheat crop in this district was largely in excess of that of 1916, but below the five-year average. The oats and corn crops were well above those of 1916 and the five-year average. The cotton crop was only from 60 to 75 per cent of last year's crop. It was at least a month late, and was caught by a killing frost about October 8. It also moved very slowly, due in great measure to the lack of vessels to carry it from port. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

458 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. The tobacco crop in general was good. The price index of all crops was 46.1 per cent higher than a year ago, and 104.3 per cent higher than the average of the preceding five years. Throughout the year there has been large buying power in the rural communities, and business, measured in dollars, continues active. A number of country merchants are buying now for the future, apparently feeling that prices will not be lower. Throughout the year there has been a shortage in cars. Until March there was little difficulty in handling shipments to the South and West, but there were serious delays in handling shipments to the East. The shortage has increased, and as the year closes transportation in all directions is in an extremely unsatisfactory condition. Labor has been unsettled throughout the year, and there have been many small strikes and threats to strike. 'At the beginning of the year the deposits of all banks in this district were at a high level and money was easy. Prevailing rates to customers in St. Louis were from 4 to 4^ per cent, and in other sections of the district the rate was somewhat higher. As the year closes, deposits in the banks in this district are higher than at the same time last year. In-the large centers the rates to customers range from 5| to 6 per cent, with rates in the outlying districts slightly higher. In brief, during 1917 the rates charged customers by banks in the larger centers have increased about 1J per cent. This country is engaged in the greatest war in history; two Liberty bond issues, aggregating $5,808,766,150, have been sold. In December of this year, in this district, the Government withdrew from the banks over $60,000,000, and many of the banks also had to make the second payment on the second issue of Liberty loan bonds approximately $17,000,000. This showed its effect on. the reserves of the banks throughout the district, but because they could rediscount with the Federal Reserve Bank of St. Louis, business felt little, if any, effect. In fact, the increase in rates to customers is probably due more to delay in transportation than to the bond issue. Mail in transit is all behind time, making the " float" in checks on the average a day late in this district. Cars can not be obtained for shipment, and this requires that the commodities, greater in value than for years previous, be carried longer. It is worth repeating again that in our first year of the war, rates to customers have increased only 1^ per cent. ACTIVITIES OF THE FEDERAL EESERVE BANK DURING THE YEAR, DISCOUNT OPERATIONS. The total rediscounts accepted by this bank during the year 1917 amounted to $181,117,651.14. Of this amount $68,983,149.22 con- Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTBIOT NO. 8—ST. LOUIS. 459 sisted of notes or single-name paper; $3,114,505.68 of trade acceptances or two-name paper; $427,277.24 of commodity paper, and $108,- 592,719 of notes of member banks secured by United States certificates of indebtedness, Liberty bonds, or eligible commercial paper as collateral. From January 1 to December 31, 1916, the total rediscounts accepted by the bank amounted to $8,842,666.57. Thus there was an increase in the amount of rediscounts accepted by the Federal Reserve Bank during 1917 over the previous year of $172,274,984.57. In December this bank rediscounted for another Federal Reserve Bank $5,000,138 of notes secured by Liberty bonds. This was the first time this bank rediscounted for another Federal Reserve Bank. During 1917 there were 8,471 notes rediscounted for member banks. During 1916 there were 3,133 notes rediscounted for member banks, showing an increase of 5,338 in the number of notes handled. Attached hereto, as Exhibit D, is a table showing the volume of discounts accepted from each State each month, the total amount accepted from each State during the whole year, and the number of banks in each State rediscounting each month, and attached, as Exhibit E, is a table showing the volume of rediscounts of the different maturities and classes accepted each month and during the whole vear. DISCOUNT KATES. The following schedule shows the rates in effect at the first of the year, and the changes made during the year: Commodity paper. Trade acceptance. 15-day In effect- da 1 y 5 s. d 3 ay 0 s. da 6 y 0 s. da 9 y 0 s. mon 6 ths. co n l o la t t e e s r . al 15 30 60 90 15 30 60 90 Jan. 1,1917.... Jan. 5,1917.... Feb. 9,1917... Nov. 7, 1917... Dec. 11,1917.. ACCEPTANCE BUSINESS. This bank during the year 1917 purchased a total of $29,732,271.79 bankers' acceptances. Of this amount $7,290,201.25 were purchased from member banks and $300,000 from nonmember banks in this district. The remainder was purchased mostly through the Federal Eeserve I^anks of New York and Boston. The rates on these acceptances ranged from 2-| to 4 per cent. MUNICIPAL WARRANTS. This bank purchased during 1917 a total of $1,005,000 par value municipal warrants at rates ranging from 2^ to 3| per cent. Digitized for FRASER 34365°—18 30 http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

460 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. OVERDUE PAPER. This bank has no overdue paper on hand. CHANGES IN THE RESERVE POSITION OF THE BANK DURING THE TEAR. On December 31, 1916, our total reserve against all liabilities was 60.8 per cent and on the same date this year the percentage was 58.8 per cent. The following table shows the reserve position of the Federal Eeserve Bank of St. Louis at the close of each month during the year 1917: Outstanding Net deposits. Federal Re- Total. Total reserves. Per cent. serve notes. Jan. 31.. $28,525,372.28 $15,960,305 $44,485,677.28 $33,821,401 76.0 Feb. 28. 25,047,603.63 14,989,370 40,036,973.63 28,053,259 70.1 Mar. 31. 29,202,912.36 14,160,270 43,363,182.36 32,950,862 75.9 Apr. 30. 21,856,045.55 15,061,770 36,917,815.55 25,199,942 68.3 May 31. 29,608,753.62 15,767,670 45,376,423.62 30,427,185 67.0 June 30. 42,577,207.10 17,346,870 59,924,077.10 47,179,671 78.7 July 31. 43,955,240.90 18,674,970 62,630,210.90 49,186,340 78.5 Aug. 31. 41,197,416.57 21,694,020 62,891,436.57 46,562,675 74.0 Sept. 29. 40,000,055.31 26,970,205 66,970,260.31 43,942,323 65.6 Oct. 31. 42,842,016.77 40,207,655 83,049,671.77 56,745,832 68.3 Nov. 30. 51,159,449.41 54,080,240 105,239,689.41 77,647,676 73.8 Dec. 31. 40,659,878.87 59,923,030 100,582,908.87 59,136,094 58.8 THE FEDERAL. RESERVE BANK AND MEMBER BANKS. CHANGES IN MEMBERSHIP DUE TO TRANSFERS FROM AND TO OTHER DISTRICTS. There has been no change in membership in this district due to transfers to and from other districts. The boundary lines of the district have not been changed since originally designated by the organization committee. MOVEMENT OF MEMBERSHIP WITHIN THE DISTRICT. On January 1, 1917, the Federal Reserve Bank of St. Louis had 469 member banks, consisting of 468 national banks and one trust company. Its authorized capital stock on that date was $5,599,500, of which one-half, or $2,799,750, was paid in. During the year four national banks, nine State banks, and three trust companies became members, increasing the authorized capital stock of this bank in the sum of $1,366,900. Thirty-three banks were allotted 279 additional shares of stock of this bank, which further increased its authorized capital $27,900. During 1917 seven member banks holding a total of 426 shares of stock, surrendered their membership through liquidation, and three banks surrendered portions of their holdings aggregating 25 shares Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 8 ST. LOUIS. 461 on account of reductions in their capital or surplus, thereby decreasing the capital stock of this bank in the sum of $45,100. At the close of 1917 this bank had a total of 478 member banks, consisting of 465 national banks, nine State banks, and four trust companies, and its authorized capital was $6,949,200, of which $3,- 474,600 was paid in. This shows a net increase of nine in the number of member banks, and a net increase in the paid-up capital stock of $1,349,700 over 1916. RELATION TO NATIONAL BANKS. It is believed that all the national banks in this district, through daily contact with this bank, brought about by its clearing system which in some form has been in operation practically since the opening of the bank, have been brought into closer relation with it. With banks that have rediscounted with us, any idea of " red tape " which once existed, has disappeared, and they find that they can do their business with us as easily as they have conducted their business with other banks. On the other hand, this bank has always taken the position that, even though its member banks must keep deposits with us, under the law, nevertheless, it should make every consistent effort to please its customers just as if it were a commercial bank competing for deposits. STATE BANKS AND TRUST COMPANIES. During the year 1917 twelve State banks and trust companies have taken stock in the Federal Reserve Bank of St. Louis. They are: D m at i e s s o io f n a . d- Name. Location. Ca s p u i r t p a l l u a s n . d T so o u ta r l c e r s e . - Apr. 12,1917 St. Louis Union Bank St. Louis, Mo $5,000,000.00 $45,530,370.33 May 4,1917 Mississippi Valley Trust Co do 6,500,000.00 31,297,412.73 May 31,1917 International Bank do 1,000,000.00 8,100,583.91 June 9,1917 German Savings Institution do. 2,500,000.00 21,243,246.09 July 2,1917 German Insurance Bank Louisville, Ky 750,000.00 8,470,284.18 Oct. 10,1917 Lafayette South Side Bank St. Louis, Mo 1,200,000.00 13,264,217.67 Oct. 30,1917 Franklin Bank do 1,300,000.00 9,478,230.67 Nov. 2,1917 German-American Bank . do 1,700,000.00 9,915,950.37 Oct. 31,1917 Union & Planters Bank & Trust Co.. Memphis, Term 1,600,000.00 15,307,795.76 Nov. 15,1917 Paoli State Bank Paoli, Ind 25,750. 00 191,074.49 Dec. 15,1917 State Savings Loan & Trust Co Quincy, 111 1,000,000.00 7,947,274.67 Dec. 20,1917 Effingham State Bank Effingham, 111 60,000.00 677,843.72 Prior to the admission of the above, the Mercantile Trust Co. of St. Louis was the only State institution which was a member of the Federal Reserve Bank of St. Louis. It has been a member of the Federal Reserve system ever since the system was established. The number of State banks and trust companies eligible for membership, by States, exclusive of those that have already joined, are as follows: Arkansas, 177; Illinois, 172; Indiana, 88: Kentucky, 101; Mississippi, 85: Missouri, 296; Tennessee, 54; total, 973. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

462 ANN1TAL REPORT OF THE FEDERAL RESERVE BOARD. On May 18, 1917, Mr. W. L. Hemingway, president of the Mercantile Trust Co. of Little Rock, Ark., called a meeting in that city of all the eligible State banks and trust companies in that State. The chairman of the board of this bank met with them and discussed the advantages of membership. It is not an overstatement to say that since the President's appeal to nonmember banks to join the system practically all of the eligible State banks and trust companies in this district are giving the matter of membership serious consideration. . ACCOMMODATION OF MEMBER BANKS THROUGH DISCOUNTS. Below is given a table showing the number of different member banks offering rediscounts from each State each month during 1917, the total number* of different banks offering rediscounts from the whole district each month, the number and percentage of different banks offering rediscounts from each State during the year, and the number and percentage of different banks offering rediscounts in the whole district during the year. State. Arkansas... 67 35.7 Illinois 158 19.6 Indiana 63 23.8 Kentucky.. 10 66 30.3 Mississippi. 17 33.3 Missouri 87 43.6 Tennessee.. 10 20 75.0 Total... 31 24 30 33 69 78 92 i 149 478 31.1 During the year 1916, 114 different member banks rediscounted with this bank. This year 149 different member banks rediscounted, showing an increase of 35 in the number of banks accommodated. This bank has continued the policy of requiring financial statements made either by the borrowers or by the borrowing bank in every instance where paper has been accepted by us, and this policy is resulting in the standardizing of credit in this district. BILL-OF-LADING DRAFTS. Since the 1st of February, 1916, this bank has handled bill-oflading drafts for its members, under conditions set forth in a circular issued January 29, 1916, giving member banks credit on receipt for drafts with bills of lading attached, and charging interest Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 8—ST. LOUIS. 463 at the rate prevailing for 30-day commercial paper for the time such drafts have remained unpaid. Although the member banks have not generally availed themselves of the service offered in this connection, the business for 1917 shows a very substantial increase over that of 1916. Whereas, during 1916 we handled 653 drafts amounting to $4,261,210.95, and on which we collected $2,854.96 interest, during the present year, up to and including December 31, 1917, we have handled 1,453 drafts, amounting to $10,431,334.21 and have collected interest amounting to $7,492.56. The greater part of this increase occurred in the month of November, during which month we handled 757 drafts amounting to $5,573,- 506.04, and collected $3,371.86 interest. A large part of this business has consisted of New England cotton paper, and we have had excellent service from the banks in making collections. This is indicated by the fact that the average time outstanding has been only about five days, and this in spite of the fact that a large proportion of the paper was payable at sight in States where three days of grace are allowed on sight drafts. We feel that those of our members that have availed themselves of the facilities offered have appreciated the service, and we anticipate a still greater increase during the coming year. GRANTS OF FIDUCIARY POWERS. From the establishment of the Federal Reserve System to the close of 1917 the applications of 29 national banks in this district for permission to act as trustee, executor, etc., under section 11 (k) of the Federal Reserve Act have been granted by the Federal Reserve Board. Sixteen of these permits were granted in 1915, six in 1916, and seven in 1917. Of those banks granted fiduciary powers, two are located in Arkansas, five in Illinois, six in Indiana, eight in Kentucky, seven in Missouri, and one in Tennessee. Attached hereto, as Exhibit F, is a list of the national banks in this district which have been granted fiduciary powers up to December 31, 1917. BANK FAILURES WITHIN THE DISTRICT. No member bank in this district failed during the year 1917. THE LOUISVILLE BRANCH. On July 3, 1917, the board of directors of the Federal Reserve Bank of St. Louis granted the petition for a branch bank at Louisville, Ky. It elected as directors representing it: Mr. George W. Norton, director of the National Bank of Commerce, Louisville, Ky.; Mr. W. C. Montgomery, vice president First-Hardin National Bank, Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

464 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. Elizabethtown, Ky.; and Mr. W. P. Kincheloe, until the time of his election a national bank examiner, living in Louisville. This lastnamed gentleman was also appointed manager of the branch. The Federal Reserve Board appointed as directors Mr. F. M. Sackett, president of the Louisville Board of Trade, Louisville, Ky., and Mr. Charles E.. Hoge, president of the First State National Bank, Frankfort, Ky. Quarters were secured on the second floor of the Fidelity & Columbia Trust Co. Building, northwest corner of Main and Fourth Streets, Louisville, and the bank opened for business on Monday, December 3, 1917. The Louisville branch collection zone covers the following territory : All cities in that part of Kentucky included in the eighth Federal Reserve district and all cities located in the following counties in Indiana, viz: Dubois, Jackson, Clarke, Perry, Lawrence, Washington, Floyd, Orange, Harrison, Jefferson, Crawford, Scott, and Switzerland. MEMPHIS AGENCY. Last year during the cotton season this bank had an agency in Memphis, Tenn. This gave the local banks the service they desired and proved successful. This year, on October 29, we opened the agency again and operated under the same plan. Notes, trade acceptances, bankers' acceptances, and offerings for rediscount were sent direct by the bank to St. Louis, but warehouse receipts that were up as collateral to the loans were held by our agency. In this way, substitution of cotton receipts was permitted without delay or inconvenience. It is proposed to maintain the Memphis office until the close of the cotton season. THE FEDERAL RESERVE BANK AND THE PUBLIC. " With this war on us, where would we have been without the Federal Reserve system?" In discussion of the general situation, an expression smilar to this is often heard, and it states fairly well what the general public thinks. The man on the street feels that the Federal Reserve system has saved the country financially. It is due to it that business has been able to go on unafraid. The war is on and business is active—in some lines it is at a high level. However, this would not be the situation if it were not for the Federal Reserve system. The general public has thorough confidence in the Federal Reserve system, and banks that are not members are beginning to feel this attitude. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 8—ST. LOUIS. 465 THE FEDERAL EESERVE BANK AND THE GOVERNMENT, GOVERNMENT DEPOSITS. The amount of Government deposits held by the Federal Keserve Bank of St. Louis during 1917, while averaging slightly more than in 1916, gives little indication of the volume of Government business actually taken care of by this bank. From January to June normal conditions prevailed, the early part of the year showing loss through withdrawals being heavier than deposits until the tax collection period caused a gradual increase. With the commencement of Government loan operations came a gradual increase in balances during June, followed by a decrease caused by heavy withdrawals culminating with a low September balance. Operations in connection with the second Liberty loan resulted in increased funds, October and November showing the highest figures for the year. This last half of the year's business was abnormal in all respects. Its volume can be expected to continue while war loans are being placed, and doubtless afterwards much will be retained through bond coupon maturities and' taxation. RELATION TO THE UNITED STATES TREASURY. Transfers of funds and deposits on account of 5 per cent redemption funds have continued to increase throughout the year. THE LIBERTY LOAN, THE FIRST LIBERTY LOAN. The first war bond issue law was approved by the President on April 24, 1917, and when the Secretary of the Treasury advised this bank that the handling of the loan in this district was to be taken care of through it, steps were taken to organize the district. On May 10, Mr. Kolla Wells, governor of the Federal Reserve Bank of St. Louis, appointed as an executive committee the presidents of the' 18 clearing-house associations in the district, and also representatives from 5 other cities located in portions of the district where there were no clearing houses. He also appointed a central committee, composed of 9 men living in St. Louis, who were to give all of their time to the placing of the first Liberty loan. Quarters were given the central committee in the Chamber of Commerce of St. Louis, and they occupied desks there. To each member of the executive committee were assigned the counties contiguous to his clearing-house city or locality, and in this way the whole district was apportioned. Each member of the executive committee in turn acted as chairman of his district and Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

466 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. appointed such a committee from the locality to work with him as he thought wise. There was then figured the proportion of the $2,000,000,000 3J per cent issue which should be taken by district No. 8 in comparison with the whole United States, on three different bases: (1) Banking strength basis, which made the district's proportion amount to $84,300,000; (2) wealth basis, which made the district's proportion amount to $58,600,000; (3) population basis, which made the district's proportion amount to $174,600,000. The banking strength basis was decided on as the minimum amount for subscriptions to be obtained, and the average of the three bases as a target. There was then figured on the same three bases the amount that each county in the district should subscribe of the amount which it seemed fair that district No. 8, as a whole, should take. Each chairman of a local district was advised as to the amounts arrived at for the counties under his supervision, and it was suggested that the figures giving the banking strength basis, the wealth basis, and the population basis be added and divided by three in order to arrive.at the amount for which his different counties should subscribe. Later, we were advised from Washington that it was estimated that our subscription should amount to between $80,000,000 and $100,000,000, which was somewhat less than the figures we had already established. To the first Liberty loan this district subscribed an aggregate of $86,134,700, and was allotted a total of $65,469,600, the allotment by States being as follows: Arkansas $4, 202, 750 Illinois 5,667,650 Indiana 4, 253, 050 Kentucky 11, 997, 950 Mississippi 875, 000 Missouri: St. Louis $31, 038, 950 Elsewhere 1, 349, 350 35, 388, 300 Tennessee 3, 082,100 Miscellaneous 2, 800 Total 65, 469, 600 THE SECOND LIBERTY LOAN. For the second Liberty loan the district was organized on somewhat different lines. Mr. Eolla Wells, governor of the bank, appointed three committees: A general committee, composed of 38 men representing different towns throughout the district, of which committee Gov. Wells acted as chairman; an executive committee, composed of 20 men residing throughout the district, and an administrative committee of 16 men, all of wThom were brokers or bankers of Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 8—ST. LOUIS. 467 St. Louis. The administrative committee was in turn divided into subcommittees, such as purchasing supply committee, etc. The general committee, appointed at the request of the Secretary of the Treasury, served as advisory council. The executive committee, consisting principally of members of the general committee, also served in an advisory capacity. The administrative committee was responsible for the active conduct of the campaign. Of both this committee and the executive committee Mr. W. E. Compton was chairman and Mr. T. K. Smith, secretary. The members of the administrative committee were volunteers and devoted their entire time to the work. In order that the entire membership of this last-named committee should be available whenever needed, there was rented for the Liberty loan organization 18 rooms on the tenth and sixteenth floors of the Boatmen's Bank Building, as well as a practical store room on the ground floor. Quarters on the fourteenth floor of the same building were secured for the women's Liberty loan committee. Those who served on the committees and all others who gave their service are entitled to the highest praise for the abandonment with which they treated their respective businesses and gave their entire energies without compensation to make the Liberty loan a success. Both the men and women who served have the satisfaction of knowing that they have had a most honorable part in the service of their country in this time of its necessit}^. Of this $3,000,000,000 issue, the minimum suggested for district No. 8 was $120,000,000, with a maximum of $200,000,000. The eighth district subscribed to the second Liberty loan to the amount of $184,280,750, which was $64,000,000 more than the minimum suggested. The district was allotted $150,169,250. The following table shows subscriptions and allotments to the second Liberty loan by States: Subscriptions through- State. Su t b io s n c s ri . p- Allotments. N o u f m su b b e - r scribers. Member Nonbanks. member banks. Arkansas $12,878,050 $12,473,650 33,717 67 422 Illinois 22,119,150 21,406,550 54,125 154 380 Indiana .. . .. 11,711,400 11,604,900 26,880 60 134 Kentucky 22,442,950 20,387,600 54,483 66 276 Mississippi 6,088,200 5,787,100 11,119 17 167 Missouri: St Louis 74,464,600 47,707,800 123,484 15 29 Elsewhere . . . 20,679,000 20,551,600 56,203 71 979 Tennessee 13,897,400 10,250,050 25,688 19 114 Total 184,280,750 150,169,250 385,699 469 . 2,501 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

468 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. In the above table, in order to get the number of subscribers and subscriptions sent through member and nonmember banks it was necessary to address an inquiry to the 3,085 banks in this district. At this writing replies have been received from all but 115, and probably when they come in they will show more banks as having taken some part in the Liberty loan. The above table shows that of the 479 member banks in the district 469 sent in subscriptions, and out of a total of 2,606 nonmember banks 2,501 sent in subscriptions. From the above it is seen that there were 385,699 subscribers to the second Liberty loan in this district. TREASURY CERTIFICATES OF INDEBTEDNESS. Through Treasury certificates of indebtedness, which could be used in payment of subscriptions for Liberty bonds, the payments were distributed and the liability of disturbance, which might have occurred if payments on account of bonds had had to be made all at once in cash, was avoided. The following table shows certificates of indebtedness issued through this bank in anticipation of the first Liberty loan sold in this district: Treasury certificates of indebtedness, first Liberty loan. Number Dated. Due. Rate. Offering. Subscriptions. Allotment. of subscribers. Per cent. Apr 25 .. ... June 30 3 $200,000,000 $10,400,000 $10,400,000 142 May 10 July 17 3 200,000,000 7,045,000 7,045,000 131 May 25 July 30 H 200,000,000 9,972,000 7,200,000 132 June 8 ...do 3i 200,000,000 9,308,000 8,100,000 116 Total 32,745,000 The certificates of indebtedness issued in anticipation of the second Liberty loan sold in this district were as follows: Treasury certificates of indebtedness, second Liberty loan. Number Dated. Due. Rate. Offering. Subscriptions. Allotment. of subscribers. Per cent. Aug. 9 Nov. 15 3* $300,000,000 $9,599,000 $7,900,000 116 Aug. 28 Nov. 30 31 250,000,000 5,176,000 4,188,000 85 Sept. 17 Dec. 15 31 300,000,000 4,874,000 4,874,000 63 Sept. 26 ...do.... 400,000,000 11,000,000 11,000,000 239 Oct. 18 Nov. 22 4 300,000,000 12,710,000 12,710,000 208 Oct. 24 Dec. 15 4 685,000,000 5,028,000 5,028, 000 107 Total. 45,700,000 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 8—ST. LOUIS. 469 The Federal Reserve Bank of St. Louis subscribed for its own account only to four issues of the certificates of indebtedness, and sold all of these before they matured, except $249,000 of the issue dated September 17, 1917, and maturing December 15, 1917. Exhibit G shows the distribution of all certificates of indebtedness, classified bj amounts, which were allotted through the bank. It also shows the amounts taken by this bank for its own account and amounts it disposed of by sale before maturity. The Federal Reserve Bank of St. Louis did not purchase for its own account any bonds of either the first or second issue of the Liberty loan. At the close of business December 31, 1917, its loans secured by Liberty bonds and certificates of indebtedness were as follows: Rediscounts maturing in 90 days, secured by Liberty bonds and certificates of indebtedness $1, 418, 470. 33 Member banks 15-day collateral notes secured by Liberty bonds and certificates of indebtedness 7. 547, 800. 00 Total 8, 966, 270. 33 Of the first Liberty loan this district took $65,469,600, and of the second Liberty loan $150,169,250, making a total of Liberty bonds to the amount of $215,638,850. As the year closes, of this amount the Federal Reserve Bank owns none, and on December 31, 1917, held loans to member banks on Liberty loan bonds and certificates of indebtedness as collateral to the extent of only 4 per cent of the total bonds sold in the district. DEPOSITARIES OF GOVERNMENT FUNDS IN CONNECTION WITH SUBSCRIP- TIONS FOR LIBERTY BONDS. Such banks as desired were authorized by the Secretary of the Treasury to make application to him through the Federal Reserve Bank to be named as depositaries of funds arising from subscriptions to both the first and second Liberty loans. The bank passed on all the collateral offered, and there was so much work to be done that it established a department. It had custody of the collateral, performed all duties incident to the deposit and withdrawal of funds, collection of interest, accounting, etc. The largest amount of collateral in its custody at any one time was on November 15, 1917, when it amounted to $60,100,000. EXPENSE OF FISCAL AGENGY OPERATIONS. In order to do the work as fiscal agent for the Government it has been necessary to increase our force very materially. There are engaged in the department which is giving its exclusive attention to duties incident to the fiscal agency 66 employees. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

470 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. The bank has incurred as fiscal agent of the Government expenses amounting to $191,516.36, for which it has been reimbursed to the extent of $66,666.89. During the past year the comptroller's office and this bank have continued to cooperate with each other in every way possible. Copies of reports of examinations of national banks, made under the supervision of the chief examiner of this district, have been promptly filed with the Federal Keserve agent. The chief examiner and his assistants have given such other help as was in their power. THE FEDERAL RESERVE BANK AND NOTE ISSUES. GENERAL POLICY IN THE MATTER OF NOTE ISSUES. During the past year the Federal Reserve Bank of St. Louis has continued its policy of last year. It has issued Federal Reserve notes freely whenever there was a possibility of conserving gold or reserve money by their use. SUBSTITUTION OF FEDERAL RESERVE NOTES FOR GOLD AS CIRCULATING MEDIUM. Considerable progress has been made in substituting Federal Reserve notes for gold. At the end of last year it was not uncommon to find gold certificates paid out over the counter to customers of banks. As this year ends there are very few banks, if any, in the large centers or, in fact, throughout the district that pay out gold indiscriminately. Practically all the member banks and many of the nonmembers have deposited their gold with us and taken Federal Reserve notes in exchange. It wrould seem that to a very great extent the gold of the district has been turned over to the Federal Reserve Bank. COVER OF NOTES ISSUED. On December 3.1. 1917, the total amount of Federal Reserve notes of this bank outstanding was $61,863,430. Of this amount $32,366,430 were covered by gold deposited with the Federal Reserve agent and $29,497,000 by eligible paper hypothecated with him. This bank's liability on Federal Reserve notes in actual circulation at the close of the year amounted to $59,923,030. DENOMINATIONS OF NOTES ISSUED. Attached hereto, as Exhibit H, is a table showing the amount of each denomination of Federal Reserve notes issued by the Federal Reserve agent to the Federal Reserve Bank of St. Louis each month Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 8—ST. LOUIS. 471 from the opening of the bank, November 16, 1914, to December 31, 1917. An examination of this table will disclose the fact that during this year the greatest demand has been for Federal Reserve notes of the $10 and $20 denominations. This was due, no doubt, to the fact that the greater number of gold certificates of these denominations outstanding have been turned in to the Federal Reserve Banks, and Federal Reserve notes of similar denominations were needed by the public. Also, notes of these denominations were used to a great extent by the Government in meeting its Army pay roll. As was the case in both 1915 and 1916, the demand for Federal Reserve notes was heaviest in the months of September, October, and November. INTERDISTRICT MOVEMENT OF NOTES. During the year 1917 the Federal Reserve Bank of St. Louis received from other Federal Reserve Banks $3,344,960 of its own Federal Reserve notes and returned to other Federal Reserve Banks $7,979,770 of their Federal Reserve notes. In other words, this bank returned $4,634,810 more notes of other banks than it received of its own. As was the case in 1916 the Federal Reserve Banks of Chicago and New York sent to us during 1917 for redemption more of our notes than any other districts, and we returned for redemption more notes of the Kansas City and Dallas Federal Reserve Banks than of any other districts. Attached hereto, as Exhibit I, is a statement showing the amounts of Federal Reserve notes of this bank received from other Federal Reserve Banks for redemption or credit, and notes of other Federal Reserve Banks returned by this bank to them for redemption or credit, from January 1, 1917, to December 31, 1917. REDEMPTION AND DESTRUCTION OF NOTES. During 1917 the Treasurer of the United States redeemed out of the redemption fund maintained with him by the Federal Reserve agent, $5,816,300 of unfit notes of the Federal Reserve Bank of St. Louis. From the opening of the bank to December 31, 1917, $8,426,570 of unfit notes have been redeemed, being of the following denominations: Fives, $3,780,950; tens, $3,167,010; twenties, $1,436,- 510; fifties, $40,500; hundreds, $1,600. These were turned over to the Comptroller of the Currency and destroyed. Of the unfit Federal Reserve notes redeemed by the United States Treasurer $5,365,- 000 were shipped to him by the Federal Reserve Bank of St. Louis, and $3,061,570 were shipped by other parties. Out of the redemption fund maintained by the Federal Reserve Bank of St. Louis with the United States Treasurer, he redeemed Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

472 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. $1,123,600 of fit notes during 1917, making a total of $1,953,750 from the opening of the bank to the close of 1917. These were returned to the bank and again put into circulation. COST OF FEDERAL RESERVE NOTES. The total cost to this bank of the Federal Eeserve notes issued during 1917 was $49,363. This is figured on a basis of 1 cent per note, and does not include the cost of shipping Federal Reserve notes to Washington by this bank or other parties for redemption and the return of fit notes to this bank. During the past year it has cost this bank $1,228.84 for the return of its Federal Eeserve notes to the United States Treasurer for redemption. FEDERAL RESERVE BANK NOTES. The Federal Reserve Bank of St. Louis has not as yet issued any circulating notes secured by United States Government bonds. FEDERAL RESERVE AGENT AND NOTE ISSUES. During the year shipments of Federal Reserve notes aggregating $50^560,000 were received by the Federal Reserve agent, the majority being received during September, October, and November, when there was a heavy demand for notes in this district. Since the first of the year, in addition to the supply of notes kept in the vaults of the Federal Reserve agent, a large supply has been maintained in the subtreasury at St. Louis. This was of considerable assistance in meeting the great demand this year. Attached hereto as Exhibit J is a statement of Federal Reserve notes received by the Federal Reserve agent from the Comptroller of the Currency each month from the opening of the bank to December 31, 1917. There is also attached as Exhibit K a summarized statement of the receipt and disposition of all Federal Reserve notes by the Federal Reserve agent from the opening of the bank to the end of 1917, as well as of all funds and securities in his possession. Since the passage of the amendment to section 16 of the Federal Reserve Act on June 21, 1917, all Federal Reserve notes, gold, and gold certificates in the possession of the Federal Reserve Agent have been held jointly with the Federal Reserve Bank of St. Louis. INTERNAL MANAGEMENT OF THE BANK. The directors of this bank have held meetings on the first and third Wednesdays of each month at 10 o'clock a. m. throughout the year. There has been a total of 23 meetings, at all of which there was a quorum present. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 8—ST. LOUIS. 473 The executive committee, composed of the governor of the bank, chairman of the board, and Messrs. Walker Hill, F. O. Watts, and D. C. Biggs, has met on Monday and Friday of each week throughout the year at 10:30 a. m. All offerings come first before the officers' committee, composed of all the officers of the bank, which meets daily. Offerings passed by this committee are immediately credited to the offering bank's account. These are in turn reported to the executive committee at its next meeting, and the full minutes of the executive committee are always read at the meeting of the board of directors. In 1916, Mr. Sam A. Ziegler, of Albion, 111., was elected by group No. 3 as a class A director to serve for three years from January 1, 1917, to succeed Mr. Oscar Fenley. Mr. W. B. Plunkett, of Little Eock, Ark., was elected by group No. 2 as a class B director to succeed himself, to serve for three years from January 1, 1917. At the election which took place in December of this year, Mr. Walker Hill, of St. Louis, was elected by group No. 1 as a class A director to succeed himself, to serve for three years from January 1, 1918. Mr. LeEoy Percy, of Greenville, Miss., was elected by group No. 3 as a class B director to succeed himself, to serve for three years from January 1, 1918. The lists of banks making up groups 1 and 3 were sent out on September 27, 1917, giving approximately one and one-half months in which banks interested could certify their electors and make nominations. However, of 154 banks in group 1, only 88 voted. In group No. 3, of 162 banks, only 42 voted. On August 2, 1917, Mr. C. P. J. Mooney, of Memphis, Tenn., was * appointed by the Federal Eeserve Board as a class C director of this bank, to serve for three years from January 1, 1917, to fill the vacancy which had existed from the beginning of the year. This bank has been represented on the Federal Advisory Council by Mr. F. O. Watts, of St. Louis. CHANGES IN PERSONNEL AND IN THE ORGANIZATION OF THE DEPART- MENTS, INCLUDING THE FEDERAL RESERVE AGENT'S OFFICE. On January 3, 1917, the same officers who served during 1916 were reelected, and Mr. O. M Attebery was elected assistant cashier.. a On April 4, 1917, the board of directors elected Mr. E. E. Clabaugh as assistant cashier, and on July 18, 1917, the board of directors appointed Mr. A. H. Haill, the auditor, as an assistant cashier, and appointed Mr. John A. Will as auditor to succeed Mr. Haill. At the end of last year, the bank had 53 employees on its pay roll. As this year closes it has 171, of whom 66 are employed exclusively in the Liberty loan department. In order to handle the work in- Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

474 ANNUAL EEPOET OF THE FEDERAL RESERVE BOARD. ciclent to acting as fiscal agent for the United States Government it was necessary to organize a distinct department. This bank has grown very rapidly during the year, especially in the latter part. On August 2, 1917, Mr. C. M. Stewart, who has been with the bank since its organization, was appointed assistant Federal Re~ serve agent. OFFICE AND VAULT FACILITIES BANK PREMISES. At the close of 1916, our office facilities were so ample that we did not expect to be crowded for some years, but as this year closes we are crowded for working space in our bank room and have had to get quarters on the fourth floor of the Federal Reserve Bank Building for the use of our Liberty loan organization. In order to get the necessary space, we have arranged to take the second and third floors of an adjoining building, which will open into the Federal Reserve Bank Building. This building has but recently been vacated, and our new quarters are being remodeled. Our vault room has also proven inadequate, and we have been compelled to rent temporarily additional vault space in order to care for interim certificates and Liberty loan conversion 4s. We are now preparing to rearrange our permanent vault in the basement of our building, and believe that wThen this is done we shall have sufficient vault room. THE CLEARING PROBLEM. The clearing plan proposed by the Federal Reserve Board which went into effect on July 15, 1916, has continued throughout the year 1917 with very satisfactory results. The volume of business handled and the number of State banks clearing at par for us are constantly increasing. Attached hereto, as Exhibit L, is a table showing the operations of our present clearing system. CLEARING HOUSE CHARGES. During the year 1917 changes in clearing-house rules regarding exchange charges have been few and of little importance. FEDERAL RESERVE EXCHANGE AND TRANSFER DRAFTS. On June 1, 1917, we put into effect a plan proposed by the Federal Reserve Board, whereby member banks could, under restrictions and regulations outlined in a circular issued by us, draw upon this bank and the drafts thus drawn be received at par without time deduction by other Federal Reserve Banks. While this plan made it possible for our member banks to issue exchange on us available at par without time deductions in all reserve Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 8 ST. LOUIS. 475 districts, our member banks have not availed themselves of these facilities. SEKVICE RENDERED TO THE BANKS BY THE GOLD SETTLEMENT FUND. The gold settlement fund continues as an ideal settlement medium for exchange operations and as a stabilizer of the exchange market. The great volume of exchange handled during the current year by the Federal Reserve Bank testifies to the success of this feature from the standpoint of member banks. COLLECTION DEPARTMENT. On August 25, 1917, this bank issued a circular advising that on September 1 it would establish a department for the handling of maturing notes and bills, coupons, and other straight collection items. Although the member banks have not generally taken advantage of the opportunity to handle items of the prescribed nature through this bank, the business has been increasing slowly, as shown by the fact that during the month of September we handled 200 collection items, amounting to $548,214.40, against 400 items in October, amounting to $932,294.67, 456 items in November, amounting to $1,329,726.17, and 473 items in December, amounting to $1,479,765.58. The greater part of this business has consisted of checks of large amounts drawn on banks outside of this district, which, for one reason or another, the indorsing banks have preferred to handle as collection items rather than as cash items. All items handled through this department are sent to banks in the cities where they are payable and the collecting banks are requested, if they find it inconvenient to remit in St. Louis exchange, to remit to the Federal Reserve Bank of their district for our account. The service we have obtained from other banks has been good, and returns have been made promptly. SUMMARY ON CONDITIONS IN DISTRICT NO. 8. Reviewing the year 1917, the conclusion must be reached that in spite of the war, it has been a prosperous one for district No. 8. The agricultural sections have all received high prices for their products, and in the majority of lines, manufacturers, wholesalers, and jobbers are doing an active business. There is confidence in the future. The war is making itself felt more and more in the manner of living, and the necessary conditions are being met by the people, not grudgingly, but in a spirit of cheerfulness. There is a shortage in sugar, a shortage in coal, and transportation facilities are rather chaotic. The Federal Reserve Bank of St. Louis has met adequately all demands made upon it. It has created confidence, stabilized busi- 34365°—18 31 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

476 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. ness, and has done its share in the flotation of the two Liberty loans without undue disturbance to the general situation. EXHIBIT A.—Condensed comparative statement of current earnings and expenses of Federal Reserve Bank of St. Louis each month during 1916 and 1917. January. February. March. April. May. June. 1916. Earnings. $9,168.57 $11,132.34 $13, 847.85 $14,202.08 $17,118.22 $19,076.24 Expenses $15,990.14 $15, 637.94 $15, 559.45 $16,018.68 $15,929.75 $15,283.13 Loss $6,821.57 $4,505.60 $1,711.60 $1,816.60 Gain $188.47 $3,793.11 Per cent expense to earnings... 174.40 155.80 112.36 112.79 93.06 80.12 1917. Earnings $31,399.97 $31,283.50 $33,052.05 $35,945.97 $43,806.20 $47,166.86 Expenses $12,428.15 $12,183.17 $11,377.53 $11,677.40 $15,227.79 $14,494.87 Loss Gain $18,971.82 $19,100.33 $21,674.52 $24,268.57 $28,578.41 $32,671.99 Per cent expense to earnings... 39.58 39.00 34.42 32.48 34.77 30.73 July. . August. September. October. November. December. 1916. Earnings $24,960.14 $26, 705.63 $28, 781.67 $33,071.33 $32,098.37 $38,122.95 Expenses $16,323.98 $14,598.80 $14,283.68 $19,702.08 $18,249.10 $14,921.77 Loss Gain $8,636.12 $12,106.83 $14,497.99 $13,369.25 $13,829.27 $23,191.18 Per cent expense to earnings... 65.40 54.64 49.63 59.57 56.85 37.35 1917. Earnings $53,280.88 $55,826.44 $66,899.76 $91,292.85 $96,823.68 $151,935.02 Expenses $16,194.15 $15,960.52 $19,882.94 $33,689.96 $34,034.48 $39,392.94 Loss Gain $37,086. 73 $39,866.12 $47,016.82 $57, 602.89 $62,789.20 $112,542.08 Per cent expense to earnings... 30.39 28.60 29.72 36.90 35.16 25.93 Including amortization of organization expense. EXHIBIT B.—Comparative statement of condition, 1916-17. Dec. 31,1916. Dec. 31,1917. EESOURCES. Bills discounted, members $1,300,711.54 $28,584,397.60 Bills discounted, other Federal Reserve Banks. 4,875,838.00 Bills bought in open market 7,036,819.35 7,362,724.15 Investments-municipal warrants 575,879.71 Bills of lading drafts 71,067.46 566,536.89 United States bonds 2,202,900.00 2,233,400.00 United States gold notes 891,000.00 1,444,000.00 Total earning assets. 12,078,378.06 45,066,896.64 Premium on United States bonds 17,303.15 6,353.15 Interest accrued on United States bonds 19,161.17 24,850.94 Furniture and equipment 28,688.75 44,498.74' Cost of unissued Federal Reserve notes 19,763.00 16,166.61 Expenses paid in advance 849.30 1,626.51 Due from member banks, overdrafts 15,595.22 Expenses due as fiscal agent from United States Treasury. 124.849.47 Total.. 101,360.59 218,345.42 Due from Federal Reserve Banks. 20,389,339.94 36,678,287.04 Due from Louisville branch 261,950.52 Deferred debits, transit account... 3,065,478.15 13,715,178.67 Exchange for clearing house 15,221.21 514,252.43 Total deductions from gross deposits. 23,470,039.30 51,169,668.66 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 8—ST. LOUIS. 477 EXHIBIT B.—Comparative statement of condition, 1916-17—Continued. Dec. 31,1916. Dec. 31,1917. Gold coin and gold certificates $11,088,000.00 $5,089,137.50 Gold settlement fund 3,395,000.00 17,884,000.00 Gold redemption fund, United States Treasurer. 254,850.00 929,900.00 Gold deposited with Federal Reserve agent 12,542,730.00 32,366,430.00 Sterling gold account 2,100,000.00 Other lawful money 1,449,273.00 766,626.50 Total reserve cash. 28,729,853.00 59,136,094.00 National-bank notes and Federal Reserve notes, other banks. 806,435.00 2,047,705.00 Federal Reserve notes on hand 431,445.00 1,980,400.00 Nickels and cents 321.08 787.24 Total other cash.. 1,238,201.08 4,028,892.24 Total resources... 65,617,832.03 159,619,896.96 LIABILITIES. Capital paid in 2,799,750.00 3,474,600.00 Undivided profits 12,748.15 230,338.58 Unearned discount and interest. 26,791.25 133,422.20 Reserved for sundry expenses... 1,604.14 853.65 United States Government deposits 2,614,398.56 5,430,359.99 Due to Federal Reserve Banks 12,332,388.18 30,445,011.49 Due to member banks , £0,924,990.84 45,796,967.60 Due to nonmember banks—clearing account- 93,432.34 Deferred credits—transit account 11,954,257.21 Dividend and expense checks 15,430.91 197,223.90 Gross deposits 45,887,208.49 93,917,252.53 Federal Reserve notes issued 16,889,730.00 61,863,430.00 Total liabilities.. 65,617,832.03 159,619,896.96 Total reserve against net deposit and Federal Reserve note liabilities per cent. 60.8 59.8 EXHIBIT C.—Comparative profit-and-loss statement, 1916 and 1917. Jan. 1 to Jan. 1 to Dec. 31,1916. Dec. 31, 1917. Earnings from: Bills discounted, members $46,041.34 $347,871.10 Bills discounted, Federal Reserve banks. 10,367.40 Bills purchased, acceptances 81,598.79 170,233.26 United States securities 70,362.41 110,300.98 Municipal warrants 31,618.94 13,691.40 Exchange 30,000.00 57,919.95 Bill of lading drafts 2,782. 73 7,492.56 Appreciation on United States bonds 17,873.14 Depleted reserve penalties 2,036.01 "**i4,968.34 Profit on United States securities sold 3,776.50 Sundry profits 68.67 i" 203." 26 Transit department income (net) 11,790.08 4,665.13 Total. 297,948.61 738,713.38 Expenses: Current expenses 136,461.44 174,461.12 Federal Reserve Board assessments 9, 749.62 12, 733. 22 Cost of Federal Reserve currency issued. 10,720.00 49,363.00 Total. 156,931.06 236,557.34 Profit on operation 141,017.55 502,156.04 1914-15 organization expense amortization 97,169.29 Surplus available for dividends 43,848.26 502,156.04 Dividend paid 31,100.11 284,565.61 Undivided profits for year 12,748.15 217,590.43 12, 748.15 Undivided profits for previous years. Total undivided profits 12,748.15 230,338.58 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

478 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. EXHIBIT D.—Table showing volume of rediscounts accepted by the Federal Reserve Bank of St. Louis from each State each month, the total amount accepted from each State during the year 1917, and the number of different banks in each State red is counting each month. Arkansas. Illinois. Indiana. Ken tuck y. Banks. Amount. Banks. Amount. Banks. Amount. Banks. Amount. January 2 $310,035.00 4 $30,129.09 February... 2 186,107.79 3 10,381.25 March 5 457,318.74 9 12,213. 63 2 6,200.00 3 24,119.80 May 5 105,158.00 6 140,975.53 1 $22,060.00 June 3 66,968.59 5 102,886.96 3 $149,751.91 3 310,000.00 July 9 172,878.14 152,976.81 4 875,317.44 4 892,547.64 August 7 174,308.34 7 87,673.52 3 396,742.80 6 1,358,546.06 September.. 17 1,071,883.49 5 97,708.98 2 583,968.24 6 824,001.00 October 14 2,433,682.91 9 168,779.95 4 570,905.74 10 1,286,484.93 November.. 10 2,636,896.19 17 1,498,252.50 9 1,361,571.49 14 2,661,832.43 December... 13 2,433,568.76 17 944,043.06 12 2,933,769.50 17 3,315,341.22 Total 10,055,005.95 3,270,141.08 6,872,027.12 10,670,813.28 Mississippi. Missouri. Tennessee. Total. Banks. Amount. Banks. Amount. Banks. Amount. Banks. Amount. January 2 $19,200.00 5 $70,364.76 2 $176,000.00 $605,728. 85 February... 1 40,000.00 2 16,568.70 3 315,771.97 - 568,829.71 March 3 7,900.00 11 1,214,084.95 3 146,000.00 1,837,517.32 April 3 35,900.00 12 3,573,520.62 4 293,614.76 3,933,355.18 May 2 29,440.00 12 • 5,435,121.18 4 216,317.09 5,949,071.80 June 3 45,936.12 12 3,694,994.15 4 172,264.85 4,542,802.58 July 3 41,203.33 14 13,018,802.07 3 227,680.98 15,381,406.41 August 3 28,579.25 10 12,829,944.08 4 228,550.05 15,104,344.10 September.. 5 52,496.66 14 21,094,052.82 12 1,302,336.67 25,026,447.86 October 5 124,389.33 17 19,052,640.00 10 2,234,864.45 25,871,747.31 November.. 3 42,655.67 19 19,667,886.22 6 4,444,600.59 32,313,695.09 December... 4 140,608.29 23 35,406,103.35 6 4,809,270.75 49,982,704.93 Total.. 608,308.65 135,074,082.90 14,567,272.16 181,117,651.14 EXHIBIT E.—Table shoiving the rediscount operations of the Federal Reserve Bank of St. Louis, each month during 1917, classified by maturities and classes of paper. NOTES. 15 days and 91 days to 6 less. 16 to 30 days. 31 to 60 days. 61 to 90 days. months. Total. January $31,500.00 $73,000.00 $19,616.00 $67,247,65 $27,434.21 $218,797.86 February.. 5,000.00 81,107.45 83,731.25 10,811.25 800.00 181,449 95 March 6,758.76 42,725.85 60, 764.97 26,992.00 137,241.58 April 1,331,971.84 697,668.81 170,024. 60 266,050.71 41, 713. 75 2,507,429.71 May 706,848.21 654,328.94 1,218,957.47 1,381,746.59 37,742.27 3,999,623.48 June 196,900.00 329,288.84 438,511.60 1,069,264. 91 37,491. 69 2, 071,457.04 July 903,246.92 531,962.81 1,678,545.59 912,945.60 28, 916.92 4,055,617.84 August 2,398,047.59 793,245.57 1,026,823.45 957, 7.61.80 81,657.03 5,257,535.44 September. 3,277,591.00 2,677,987.05 2,889,446.33 2,242,773.78 9,012.31 11,096,810.47 October 1,131,991.17 3,374,659. 69 1, 667,208.16 1, 986,124.44 43,193.96 8,203,177.42 November.. 1,571,279. 84 1, 259,526.83 2,754,881.56 1,815,974.09 29, 990.00 7,431,652.32 December.. 11,426,730.75 3, 793,103.68 4, 687, 060.31 3,871,968.49 43,492.88 23, 822,356.11 Total. 22,981,107.32 14,272,638.43 16,677,532.17 14,643,434.28 408,437.02 68,983,149.22 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 8—ST. LOUIS. 479 EXHIBIT E.—Table showing the rediscount operations of the Federal Reserve Bank of St. Louis, each month during 1917, classified by maturities and classes of paper—Continued. TRADE ACCEPTANCES. 15 days and less. 16 to 30 days. 31 to 60 days. 61 to 90 days. Total. January $11,930.99 $11,930.99 February... $14,908.03 $6,209.47 1,262.26 22,379.76 March 566.36 1,302.23 28,407.15 30,275.74 April 3,167.29 26,354.73 18,524.45 48,046.47 May 17,097.01 37,568.44 204,923.66 $154,859.21 414,448.32 June 12,725.80 157,128.49 184,337.98 2,153.27 356,345.54 July 7,370.21 71,602.41 49,902.22 7, 913.73 136,788.57 August 3,643.55 30,371.24 28,458.84 4,335.03 66, 808.66 September. 14,671.40 11,780.12 29,503.56 37,182.31 93,137.39 October 1,501.32 111, 736,12 54,374.98 132,368.84 299,981.26 November.. 39,405.70 130, 884.05 256,901.84 224,562.57 651,754.16 December.. 110,802.75 133,986. 78 571,390.19 166,429.10 Total. 225,859.42 718,924.08 1,439,918.12 729,804.06 3,114,505.68 COMMODITY PAPER. 16 to 30 days. 31 to 60 days. 61 to 90 days. Total. May $15,000.00 $15,000.00 July.. . $11,500.00 $2,500.00 5,000.00 19,000.00 October. 15,000.00 67,588.63 82,588.63 November 33,154.78 78,666.85 198,866.98 310,688.61 Total 44,654.78 96,166. 85 286,455.61 427,277.24 COLLATERAL NOTES. 15 days and 15 days and less. less. January $375,000.00 August $9,780,000.00 February.. 365,000.00 September 13,836,500.00 March 1,670,000.00 October... 17,286,000.00 April 1,377,879.00 November. 23,919,600.00 May. 1,520,000.00 December. 25,177,740.00 June 2,115,000.00 July 11,170,000.00 Total. 108,592,719.00 EXHIBIT F.—National banks which have been granted fldicuary powers, under section 11 (k) of the Federal Reserve Act, up to Dec. SI, 1917. Trustee, executor, administrator, and registrar of stocks and bonds: First National Bank, Fordyce, Ark. Lee County National Bank, Marianna, Ark. First National Bank, Anna, 111. Ayers National Bank, Jacksonville, 111. City National Bank, Metropolis, 111. First National Bank, Pittsfield, 111. City National Bank, Evansville, Ind. Old State National Bank, Evansville, Ind. First National Bank, Mitchell, Ind. First National Bank, Mount Yernon, Ind. Citizens National Bank, Tell City, Ind. First-Hardin National Bank, Elizabethtown, Ky. Farmers National Bank, Glasgow, Ky. Henderson National Bank, Henderson, Ky. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

480 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. Trustee, executor, administrator, and registrar of stocks and bonds—Continued. First National Bank, Hopkinsville, Ky. Citizens National Bank, Lebanon, Ky. Marion National Bank, Lebanon, Ky. Boone County National Bank, Columbia, Mo. Exchange National Bank, Columbia, Mo. Citizens National Bank, Sedalia, Mo. Union National Bank, Springfield, Mo. Merchants-Laclede National Bank, St. Louis. Mo. National Bank of Commerce, St. Louis, Mo. Central-State National Bank, Memphis, Tenn. Trustee, executor, administrator, and registrar of bonds: Morganfield National Bank, Morganfield, Ky. Trustee, executor, and administrator: Nokomis National Bank, Nokomis, 111. Bedford National Bank, Bedford, Ind. First National Bank, Versailles, Mo. Trustee and registrar of bonds: American National Bank, Bowling Green, Ky. EXHIBIT G.—Treasury certificates of indebtedness allotted to subscribers through the Federal Reserve Bank of St. Louis, Mo. $25,000 or less. Over $25,000 to Over $50,000 to $50,000. $100,000. Issue. Offering. Date. M i a ty tu . r- N b u e m r. - Amount. N b u e m r. - Amount. N b u e m r. - Amount. 1917. 1917. 1 $200,000,000 Apr. 25 June 30 77 $1,045,000 22 $1,015,000 17 $1,755,000 2.. 200,000,000 May 10 July 17 87 982,000 20 904,000 12 1,102,000 3 200,000,000 May 25 July 30 97 851,000 8 254,000 12 773,000 4 200,000,000 June 8 ...do 87 938,000 6 236,000 9 659,000 6 5... 3 2 0 5 0 0 , , 0 0 0 0 0 0 , , 0 0 0 0 0 0 A A u u g g . . 2 9 8 N N o o v v . . 3 1 0 5 8 5 0 8 9 65 4 2 0 , , 0 0 0 0 0 0 1 8 1 3 4 2 3 0 0 , , 0 0 0 0 0 0 9 8 6 6 4 0 0 0 , , 0 0 0 0 0 0 7 . .. 300,000,000 Sept. 17 Dec. 15 38 414,000 9 390,000 5 480,000 8 400,000,000 Sept. 26 ...do 194 2,054,000 19 820,000 9 840,000 9 300,000,000 Oct. 18 Nov. 22 152 1,647,000 24 1,060,000 11 895,000 10. . 685,000,000 Oct. 24 Dec. 15 80 903,000 13 578,000 7 635,000 1918. 11... 690,000,000 Nov. 30 June 25 51 598,000 9 450,000 3 275,000 Total 3,725,000,000 1,001 ill, 024,000 149 6,457,000 102 8,654,000 Ove $ r 2 $ 5 1 0 0 ,0 0 0 ,0 0 0 . 0 to Ove $ r 5 $ 0 2 0 5 ,0 0 0 ,0 0 0 . 0 to Ov $ er 1 , $ 0 5 0 0 0 0 ,0 ,0 0 0 0 0 . to Over $1,000,000. Total. Issue. N b u e m r. - Amount. N b u e m r. - Amount. N b u e m r. - Amount. N b u e m r. - Amount. N b u e m r. - Amount. 1 12 $1,730,090 6 $2,450,000 2 $1,385,000 1 $1,020,000 137 $10,400,000 2 7 1,183,000 6 2,213,000 1 661,000 133 7,045,000 3 7 931,000 2 615,000 6 3,776,000 132 7,200,000 4 8 1,427,000 3 1,130,000 1 690,000 2 3,020,000 116 8,100,000 5 8 1,340,000 6 2,500,000 1 615,000 1 1,435,000 116 7,900,000 6 6 1,065,000 4 1, 551,000 84 4,188,000 7 7 1,496,000 4 1, 494,000 1 600,000 64 4,874,000 8 5 915,000 6 2,885,000 3 2,451,000 1 1,035,000 237 11,000,000 9 9 1,553,000 7 2,555,000 6 5,000,000 209 12,710,000 10 5 900,000 1 412,000 2 1,600,000 108 5,028,000 11. 1 200,000 1 310,000 2 2,000,000 67 3,833,000 Total... 75 12,740,000 46 18,115,000 25 18,778,000 5 6,510,000 1,403 82,278,000 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 8—ST. LOUIS. 481 EXHIBIT G.—Treasury certificates of indebtedness allotted to subscribers through the Federal Reserve Bank of St. Louis, Mo.—Continued. Amount taken by Federal Re- Amount Amount Issue. serve Bank disposed of held at of St. Louis by sale. maturity. for its own account. 1 $860,000 $860,000 None. 2... None. None. None. 3 None. None. None. 4... None. None. None. 5 27,000 27,000 None. 6-.. None. None. None. 7... 369,000 120,000 $249,000 8. 701,000 701,000 None. 9... None. None. None. 10 None. None. None. 11 None. None. None. Total EXHIBIT H.—Table showing the denominations and amounts of Federal Reserve notes issued by Federal Reserve agent to the Federal Reserve Bank of St. Louis each month from opening of the bank on Nov. 16, 1911}, to Dec. 31, 1917. Month. Fives. Tens. Twenties. Fifties. Hundreds. Total. December, 1914.. $410,000 $210,000 $80,000 $700,000 August, 1915 307,000 307, 000 September, 1915. 1, 500,000 660,940 328,560 2,489,500 October, 1915 780,000 840, 000 720,000 $200,000 2,540,000 November, 1915. 740,000 760,000 640,000 2,140,000 December, 1915.. 460,000 400,000 160,000 1,020,000 Totals for 1914-15 4,197,000 2,870, 940 1,928,560 200,000 9,196,500 May, 1916 110,000 40, 000 150,000 September, 1916.. 964,350 1,392,000 1,203, 600 50 3, 560,000 October, 1916.... 941, 600 1,960,000 1,600,000 4, 501,600 November, 1916., 820, 000 1,320, 000 960, 000 3,100,000 December, 1916.. 60, 000 440, 000 500,000 Total for 1916 2,895,950 5,152,000 3, 763,600 50 11,811,600 March, 1917 160,000 200, 000 360,000 April, 1917 200,000 470,000 640,000 100, 000 $100,000 1,510, 000 May, 1917 650,000 1,290,000 1,840,000 800, 000 1,000,000 5,580,000 June, 1917 440,000 560,000 100,000 100,000 1,200,000 July, 1917 1,120,000 1,280,000 100,000 100,000 2,600,000 August, 1917 300, 000 1, 600,000 880, 000 300,000 350,000 3,430,000 September, 1917. 1, 810,000 2,130,000 1,440,000 200, 000 5,580,000 October, 1917 4, 000, 000 6,680,000 4,560,000 260,000 15,500,000 November, 1917. 3, 620, 000 5, 920, 000 4, 960, 000 600,000 900,000 16,000,000 December, 1917.. 960, 000 1,000,000 1,440, 000 100, 000 3, 500,000 Total for 1917 11,540,000 20,650,000 17,760,000 2, 760, 000 2,550,000 55,260,000 Total since opening of bank to Dec. 31,1917 18,632, 950 28,672,940 23,452,160 2,960,050 2,550,000 76,268,100 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

482 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. EXHIBIT I.—Federal Reserve notes received and returned. (Amounts of Federal Reserve notes of the several denominations received from other Federal Reserve Banks for redemption or credit and returned to other Federal Reserve Banks for redemption or credit by the Federal Reserve Bank of St. Louis during 1917.) Fives. Tens. Twenties. Exchanged with Federal Reserve Bank of— Received. Returned, Received. Returned Received. Returned. Boston $13,790 $14,000 $44,550 $30,000 $36,160 $4,600 New York 136,500 238,000 273,000 355,000 212,800 220,000 Philadelphia... 13,500 17,500 44,500 36,700 46,500 34,000 Cleveland , 13,380 29,905 18,850 60,000 18,140 86,000 R A i t c la h n m ta ond 10 6 7 , , 1 2 5 5 0 0 2 2 2 8 7 , , 1 7 0 2 0 5 1 1 8 4 0 , , 0 7 0 5 0 0 2 4 9 1 1 , , 4 7 0 2 0 0 1 1 2 3 5 , , 0 50 0 0 0 2 4 8 4 1, ;3 0 8 4 0 0 Chicago 371,500 108,500 454,000 237,500 280,000 557,530 St. Louis Minneapolis 19,980 100,000 20,940 119,000 12,580 102,000 Kansas City 89,250 1,102,700 88,100 687,180 32,200 472,120 Dallas , 70,170 506,500 153,540 649,000 143,360 464,000 San Francisco. 38,000 22,300 26,000 23,240 66,000 Total 850,750 2,410,930 1,314,530 2,536,500 943,480 2,331,640 Exchanged with Federal Reserve Bank of— Fifties. Hundreds. Total. Boston $3,800 $2,350 $1,400 $2,500 199,700 $53,450 New York 26,400 30,500 15,800 35.200 664,500 878,700 Philadelphia. . 7,500 1,600 1,000 800 113,000 90,600 Cleveland 61,350 20,000 64,800 30,800 176,520 226,705 Richmond 1,000 6,600 100 1,600 34,250 122,080 Atlanta 9,550 7,950 1,400 9,200 424,450 820,635 Chicago 27,000 102,550 2,500 44,300 1,135,000 l,050;350 St. Louis , Minneapolis 900 3,400 100 3,900 54,500 328,330 Kansas City... 1,500 21,400 100 15,100 211,150 2,298,500 Dallas 5,550 18,800 1,100 323,200 373,720 1,961,500 San Francisco. 2,650 9,250 700 9,700 58,170 14S,950 Total.. 147,200 224,400 89,000 476,300 3,344,960 7,979,770 EXHIBIT J.—Table showing Federal Reserve notes received by the Federal Reserve agent from the Comptroller of the Currency each month from opening of the bank on Nov. 16, 191J to Dec. 31, 1917. h Month. Fives. Tens. Twenties. Fifties. Hundreds. Total. November, 1914 $2,160,000 $840,000 $400,000 $3,400,000 October, 1915 1,000,000 1,000,000 800,000 $400,000 3,200,000 November, 1915 1,200,000 1,000,000 800,000 3,000,000 Total for 1914-15 4,360,000 2,840,000 2,000,000 400,000 9,600,000 September, 1916 520,000 1,520,000 660,000 3,000.000 October 1916 . 800,000 3,000,000 2,160,000 5,960', 000 November, 1916 1,900,000 1,680,000 400,000 3,980;000 Total for 1916 3,220,000 6,200,000 3,520,000 12,940,000 March 1917 800,000 800,000 April 1917.. 800,000 400,000 $400,000 1,600,000 May 1917 800,000 800,000 June' 1917 800,000 800,000 1,600,000 July 1917 - - . 1,400,000 1,760,000 200,000 400,000 3,760.000 Aueust 1917 1,000,000 400,000 800,000 400,000 2,600,000 September, 1917. 600,000 2,360,000 2,240,000 5,200; ooo October 1917... ... 5,100,000 7,960,000 3,680,000 200,000 16,940^ 000 November, 1917 3,300,000 4,360,000 4,400,000 1,000,000 800,000 13,860,000 December 1917... 600,000 2,400,000 400,000 3,400,000 • Total for 1917 9,000,000 18,480,000 18,080,000 2,600,000 2,400,000 50,560,000 Total since opening of bank to Dec. 31,1917 16,580,000 27,520,000 23,600,000 3,000,000 2,400,000 73,100,000 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 8—ST. LOUIS. 483 EXHIBIT K.—Statement of receipts and disposition of Federal Reserve notes by Federal Reserve agent from opening of the bank on Nov. 16, 1914, and of funds and securities in his possession on Dec. SI, 1917. Federal Reserve notes received from Comptroller of Currency $73, 100, 000. 00 Notes issued to Federal Reserve Bank $76, 268, 100. 00 Notes returned by Federal Reserve Bank to Federal Reserve agent $5, 966, 500. 00 Fit notes returned by United States Treasurer to Federal Reserve agent- 11, 600. 00 Unlit notes received by Comptroller from United States Treasurer for destruction 8, 426, 570. 00 14, 404, 670. 00 Federal Reserve notes outstanding 61, 863, 430. 00 Federal Reserve notes in hands of Federal Reserve agent 2, 810, 000. 00 Gold for retirement of Federal Reserve notes: In hands of Federal Reserve agent $2, 512, 600. 00 In gold redemption fund 2, 448, 830. 00 In Federal Reserve agents' fund 27, 405, 000. 00 32, 366, 430. 00 Paper pledged to secure Federal Reserve notes 29, 908, 847. 41 EXHIBIT L.—Table showing the clearing operations of the Federal Reserve Bank of 8t. Louis from Dec. 16, 1916, to Dec. 15, 1917. Daily average. Ite i c n m it y s F . d e r d a e w ra n l o R n e b s a e n rv k e s Ite i F n m e d s e d d r i a r s a l t w r R ic n e t s e o r n v o e u b t a c s n i i t d k y e s . Ite in m o s th d e ra r w d n is t o ri n c t b s a . nks Number. Amount. Number. Amount. Number. Amount. Dec. 15 to Jan. 15 1,302 $4,013,486 8,106 1,868,171 292 $2,292,931 Jan. 16 to Feb. 15 1,205 3,210,834 7,314 1,922,108 183 1,277,500 Feb. 16 to Mar. 15. 1,535 4,532,849 8,494 1,569,074 178 1,784,418 Mar. 16 to Apr. 15 1,486 4,281,367 8,524 1,656,781 • 175 1,545,007 Apr. 16 to May 15 1,673 5,008,976 8,495 1,727,335 169 1,977,438 May 16 to June 15 1,717 4,688,585 8,401 1,651,660 192 1,710,385 June 16 to July 15 1,803 5,190,645 8,448 1,623,948 214 3,281,751 July 16 to Aug. 15 1,636 4,820,182 8,069 1,641,198 220 2,314,050 Aug. 16 to Sept. 15 1,663 5,167,644 9,402 1,875,497 200 2,038,723 Sept. 16 to Oct. 15 1,689 5,593,479 9,612 2,126,025 165 2,036,901 Oct. 16 to Nov. 15 2,167 11,556,021 10,979 3,009,231 228 2,390,894 Nov. 16 to Dec. 15 2,557 9,219,408 12,564 3,176.069 204 2,057,178 Daily average. Member Non- To d t r a a l w (e n x o cl n u s T iv re e a o su f r it e e r m o s f Ite u m re s r dr o a f w n th o e n U T n re it a e s d - b d a is n t k ri s c i t n . b m p a a e n r m k l s i b s e o t. r n United States). States. Number. Amount. Number. Amount. Number. Number. Dec. 15 to Jan. 15 9,700 $8,174,589 70 $13,957 468 883 Jan. 16 to Feb. 15 8,702 6,410,442 1,628 143,536 468 872 Feb. 16 to Mar. 15 10,207 7,886,341 1,184 154,115 467 867 Mar. 16 to Apr. 15 10,185 7,483,155 1,169 171,329 468 851 Apr. 16 to May 15 10,337 8,713,749 2,242 318,699 469 863 May 16 to June 15 10,310 8,050,630 1,165 207,334 471 958 June 16 to July 15 10,465 10,096,344 1,337 627,955 471 961 July 16 to Aug. 15 9,925 8,775,430 2,218 422,022 471 968 Aug. 16 to Sept. 15 11,265 9,081,864 2,705 573,861 473 1,003 Sept. 16 to Oct. 15 11,466 9,756,405 1,859 719,081 473 1,004 Oct. 16 to Nov. 15 13,374 16,956,146 2,933 884,942 477 1,005 Nov. 16 to Dec. 15 15,325 14,452,655 4,490 1,468,199 479 997 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 9—MINNEAPOLIS. JOHN H. RICH, Chairman and Federal Reserve Agent. AGRICULTURAL CONDITIONS, 1917. The year opened with gradually advancing prices for wheat and all small grains, affording large returns to the fanners of the district. The upward trend continued until new records had been established at Minneapolis and Duluth terminal markets, and corn and small grains had reached the highest prices ever paid in the history of the district. Coincident with the movement of the new crop the Government applied price-fixing regulations on wheat effective September 1 on the basis of $2.17 at Minneapolis. Other small grains were not affected by the price fixing, nor was corn brought under price control. The result was to considerably reduce the market price on wheat and to somewhat disturb the normal relation between wheat prices and the prices of other small grains and corn, wheat becoming relatively cheaper by comparison. With the assistance of a satisfactory amount of plowing during the fall season of 1916 farmers throughout the district went into the early spring planting period with favorable prospects. Soil and moisture conditions were good. Upon the request of business men and bankers the chairman and Federal Reserve agent called a conference at Fargo, N. Dak., on April 15, as the result of which a short and active campaign was conducted throughout all the agricultural sections, resulting in North Dakota alone in the planting of 1,000,000 acres of additional crop. There were considerable increases in other parts of the district. Grain crops obtained a favorable start, but by midseason had begun to show serious damage from heat and dry weather. Much of the unripe corn sustained further damage from sharp freezing weather in late October, followed by mild, foggy days in November, which increased the moisture contents of the ear and produced mold in the kernels. In this emergency the Federal Reserve Bank acted promptly, and after consultation with bankers and business men issued seed-corn warnings to every bank within the district and provided warning 485 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

486 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. notices for the farmer customers of each bank in the corn-growing areas. These called attention to the severe damage to- seed corn and urged that the farmers immediately report any surplus on hand of seed of germinating quality, in order that it might be saved and distributed to areas where there was no seed, and that each farmer select, try out, test for germination, and store, out of corn on hand, all ears of satisfactory quality, in order to provide against spring seeding requirements. By this process, and through the assistance of reports made by member and State banks, a considerable amount of seed available for purchase was located in the hands of individual farmers and arrangements made for its distribution to areas where needed. Stock has commanded excellent prices throughout the year, as have dairy products, eggs, poultry, and practically all of the items entering into farm production. Although the crop production was less than normal, the increased cost of planting, cultivating, and harvesting showed itself in an active demand upon member banks throughout the greater part of the year, necessitating a larger degree of support from the Federal Reserve Bank than at any other time before, in its history. The effect of this demand is shown in the tabulation of the rediscount operations of the Federal Reserve Bank during the year, and in the large increase in Federal Reserve notes outstanding, issued to and utilized by its members in very large part to support agricultural operations and move the fall crops. As in the previous year, crop moving demands were promptly taken care of without recourse, as during the period prior to the establishment of the Federal Reserve system, to currency shipments from eastern money centers. BUSINESS CONDITIONS, 1917. The gradually improved business conditions which manifested themselves during the latter part of 1916 continued during the early part of the year. Under the favorable influence of a good crop outlook trade became more active, and business in all lines was in a prosperous and healthy condition. There is no evidence that the purchasing power of the farmers as a wThole has been reduced, and even in districts where the crops were poor there has been no great amount of complaint as to poor trade. The satisfactory conditions prevailing generally in retail lines are shown in a favorable year from the standpoint of wholesale and jobbing concerns, during which collections were very good and during which most houses made satisfactory increases in their business. The industrial situation over the entire district has been extremely satisfactory. The new element of war contracts which showed itself Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. MINNEAPOLIS. 487 during the latter part of 1916 was noticeably evident throughout the year, and many concerns not directly concerned in contracts for this or foreign governments were the recipients of indirect business that added substantially to their output. These enterprises were uniformly busy during the year and will enter upon the next annual period with substantial unfilled orders and with large forces of men employed at very satisfactory rates. Labor conditions were satisfactory throughout the year. RELATIONS WITH MEMBER BANKS. The more active demand upon all banks throughout the district showed itself early in the year in a larger volume of rediscounting on the part of members of the Federal Reserve system with their Federal Reserve Bank. Wide use was made of rediscount facilities throughout the harvesting and crop moving period, and many members that had not had previous occasion to present paper at the reserve bank were brought into touch with it in the regular course of their business. The increasing usefulness of the Federal Reserve Bank afforded opportunities to improve its working relations with its members. MEMBERSHIP AND CAPITAL STOCK. The total capital stock at the close of business on December 31 was $2,612,450. The particulars as to membership, capital stock, and dividends paid are shown in the following table: Capital stock and dividends. State. o N f u b m an b k e s r . Stock held. Ju D n p i e v a 3 i i d d 0 e ,1 t n o 9 d 1 s 6. J t D u o l i y " v D i 1 d e , e e 1 . n 9 3 d 1 1 s 6 , , d T to e o n D t d a e l s c d p . i a 3 v i 1 i d - , 1917. 1917. Michigan 33 $139,700.00 $11,154.17 S12,150.15 $23,304.32 Minnesota 297 1,542,050.00 110,635.83 130,359.52 240,995.35 Montana 115 322,100.00 20,813.07 24,665.49 45,478.56 North Dakota 162 260,250.00 20,172.68 22,685.75 42,858.43 Smith Dakota 128 227,100.00 16,567.12 19,445.43 36,012.55 Wisconsin 38 .121,250.00 * 22,198.01 10,748.71 32,946.72 Total... 773 2,612,450.00 1201,540.88 220,055.05 421,595.93 * Dividends paid to Wisconsin banks which were transferred to the Chicago district are included in the above figures and amount to $12,382.89. The total capital stock at the close of business December 3L 1916, was $2,608,900, and the total number of stockholders 760. On January 2, 1917, 52 Wisconsin banks, with capital stock amounting to $229,400, were transferred to the Chicago district, leaving a total of Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

488 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. 708 stockholders with capital stock holdings amounting to $2,379,500. This makes a gain for the year 1917 of 65 stockholders and $232,950 in capital stock, or a net gain over December 31, 1916, of 13 stockholders and $3,550 in capital stock. The most noticeable gain in number of stockholders is the State of Montana with a net gain of 41, and the State of Minnesota shows a net gain of $137,700 in capital stock. Member banks' capital, deposits, loans, and discounts.1 Date. M ba em nk b s e . r Capital. Surplus. d D e e p m os a i n t d s. de T p i o m si e ts. L di o s a c n o s u a n n ts d . Dec. 27, 1916 764 $57,844,000 $29,232,000 $325,142,000 $230,518,000 $500,231,000 Mar. 5, 1917 721 53,986,000 27,711,000 304,654,000 214,385,000 468,448,000 May 1, 1917 728 54,924,000 27,953,000 310,950,000 220,113,000 480,741,000 June 20, 1917 736 55,432,000 27,958,000 310,438,000 220,020,000 476,062,000 Sept. 11, 1917 747 55,487,000 27,928,000 313,431,000 227,393,000 483,§18,000 1 At comptroller's calls. The following tabulation shows the gradual improvement of the deposits of the member banks consisting of reserves and excess balances throughout the year, and also shows the fluctuating Government deposits. The figures are as of the close of business for each month: Deposits of Federal Reserve Bank. Member banks. Government. Member banks. Government. 1917. 1917. January $27,264,186.39 $2,274,984.25 July $38,225,730.98 $2,882,728.86 February... 26,793,167.43 690,006.35 August 35,771,175.81 7,113,380.45 March 28,426,819.70 3,262,258.64 September.. 39,910,270.32 3,279,215.97 April 28,009,299. 40 4,030,550.63 October 41,002,424.41 20,691,920.33 May 27,995,053.78 3,207,414.32 November.. 40,404,067.28 11,680,993.11 June 29,670,194.33 13,770,504.60 December.. 40,476,915.31 8,716,469.72 The following tabulation shows the average reserve by months during the year, and the percentage of reserve: Reserve percentages. Average Percent- Average Percentreserve. age. reserve. age. 1917. 1917. January $17,141,521 61.6 July $52,525,674 75.8 February 17,387,458 66.0 August 49,427,846 73.0 March 18,542,676 73.4 September 44,432,623 75.3 April 21,126,522 69.5 October 56,835,670 79.4 May I 18,088,966 66.5 November 59,132,553 68.4 June j 26,667,447 73.7 December 64,350,176 80.3 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 9—MINNEAPOLIS. 489 The discount rates and changes therein during the year are shown in the following tabulation: da 1 y 5 s. da 3 y 0 s. da 6 y 0 s. da 9 y 0 s. d O a 9 v v 0 e s r . Tr a a n t d h c e a e n a s c — l c e e s p s t- Commo t d h i a ty n — paper less 60 90 15 60 90 days. days. days. days. days. Per ct. Per ct. Per ct. Per ct. Per ct. Per ct. Per ct. Per ct. Per c£. Per d. Jan. 1.. 4 4 4 5 T Apr. 4.. 4 4 4 5 May 15. 4 4 4 5 \ July 25. 4 4 4 5 4 S D e e p c. t . 5 2 . 0 . 4 4 4 4 4 * 5 5 1 4 4 4 The rediscount operations of the bank, including number of applications received, number of banks reserved, number of items discounted, and the classification of discounted paper by months during the year are shown in the following tabulation: Rediscount operations. Number Number Number o re c f c a e t a i i o p v n p e s d li . - o s f er b v a e n d k . s r o e f c e i i t v e e m d s . in M 1 a 5 tu d ri a n y g s. in M 3 a 0 tu d ri a n y g s. January... 47 30 297 $376,428.00 $179,316.00 February.. 26 16 210 577,600.00 396,500.00 March 16 13 84 102,081.00 13,024.00 April 57 31 520 252,628.00 982,267.00 May 89 48 763 1,011,110.20 220,677.46 June 159 83 1,563 4,011,004.00 900,098.00 July 207 110 1,642 3,922,046.00 329,286.00 August 218 109 1,868 3,512,235.78 1,566,540.89 September. 114 54 586 1,953,262.44 136,376. 72 October 123 59 639 5,120, 614.70 617,798.22 November. 223 108 1*506 14,904, 673. 70 520,368.85 December. 233 128 1,448 3,890,704.27 446,026.33 Total 1,512 11,127 39,634,388.09 .,308,279.47 Maturing Maturing Maturing Balance end in 60 days. in 90 days. over 90 days. Total. of month. January $356,354.00 $197,410.00 $117,245.00 SI, 226,753.00 $1,826,668.79 February.. 743,568.00 19,706.00 56,724.00 1, 794,098.00 2,495,110.03 March 41,997.00 20,193.00 25,796.00 203,091.00 1,002,030.49 April 2.406, 583.00 258,107.00 202,913.00 4,102,498.00 4,259,816.57 May 1,555,648.23 466,491.16 538,468.98 3, 792,396.03 5,291,346.00 June 2,187,386.00 1,690,522.00 1,076,822.00 9,865,832.00 10,159,971.40 July 1, 628,948.00 1, 748,877.00 1,177,100.00 8,806,257.00 10,846,866.57 August 3, 617, 620. 77 1,837, 721. 79 505,121.22 11,039,240.45 15,365,094.44 September. 1,059,761.07 1,106,735.24 90,900.06 4,347,035.53 10,274,199.65 October 1,140, 637.28 606,235.22 173,033.62 7,658,319.04 10,932,047.03 November. 1,683, 851.45 1,213, 628.96 556,679.67 18,879,202.63 9,114,250.73 December. 1,406,385.20 1,685,869.61 1,011 009.08 8,439,994.49 8,082,327.78 Total 17,828, 740.00 10,851,496.98 5, 531,812.63 80,154, 717.17 89,649,729.48 Rates were in effect at the beginning of the year for the discount of commodity paper at 4 per cent for maturities within 90 days. No change was made in these rates until December 5 when the rate was Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

490 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. withdrawn. The operations of the bank in this class of paper were as follows: Commodity paper. Month. 60 days. 90 days. Total. Juno $13,400.00 $8,000.00 $21,400.00 July 6,800.00 14,600.00 21,400.00 August 41,470.00 12,000.00 53,470.00 November 15,201.67 10,198.34 25,400.01 Total. 76,871.67 44,798.34 121,670.01 Discount rates of 4 per cent upon the collateral notes of member banks prevailed throughout the year without change. The operations of the bank in this class of paper were as follows: Collateral notes, member banks. Months. 15 days. Months. 15 days. January.. $345,000.00 August $2,730,443.71 February 520,000.00 September. 1,838,147.87 March 100,000.00 October 5,076,900.00 April 140,000.00 November. 14,728,214.59 May . 875,325.00 December.. 3,274,144.91 June 3,321,000.00 July...... 3,804,151.00 Total 36,753,327.08 The following tabulation gives the average amount of discounts held and the average rate of earnings thereon by months throughout the year: Average amount of discounts held. Average Average. Month. Average held. Earnings. rate of Month. Average held. Earnings. rate of earnings. earnings. January $1,809,200.00 $6,905.19 4.49 August $12,270,300.00 $46,747.35 4.48 February 2,216,400.00 7,417.12 4.36 September 12,422,500.00 45,762. 64 4.48 March 1,511,400.00 5,918.52 4.61 October 8,319,100.00 30,791.24 4.36 April 2,522,500. 00 8,564.49 4.13 November.... 12,697,200. 00 40,069. 83 3.84 May 5,092,500.00 17,984. 40 4.16 December 18,222,700.00 30,826.53 4.41 June 6,704,900.00 22,301.49 4.05 July 10,301,700.00 37,669.72 4.30 Yearly average 7,370,500.00 4.22 The discount rates on trade acceptances remained stationary throughout the year at 3| per cent for acceptances of less than 60 days maturity and 4 per cent for acceptances of 90 days or less. Through the medium of printed leaflets, published articles, and addresses, the officers of the bank have sought to bring about a broader understanding of the usefulness of this class of paper and of the encouragement offered by the Federal Reserve Act to reestablish it as a common form of settlement. These efforts have met an en- Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 9 MINNEAPOLIS. 491 couraging reception from business men, credit associations, and others interested, and there has been an appreciable increase in the number of business houses that are encouraging settlement by acceptance. The operations of the bank in this class of paper were as follows: Trade acceptances. Month. 15 days. 30 days. 60 days. 90 days. Total. January $5,000.00 $20,654.00 $22,375.00 $7,649.00 $55,678.00 March 2,081.00 2,388.00 2,505.00 3,289.00 10,263.00 June 4,732.00 26,881.00 17,591.00 49,204.00 July 9,396.00 2,842.00 12,238.00 August 36,173.66 5,216.10 1,160.00 42,549.76 September.. 1,000.00 1,000.00 October 1,876.69 41,914.77 14,909.10 1,118.00 59,818.56 November.. 26,906.50 8,772.22 35,678.72 December... 61,690.53 35,552.41 97,242.94 Total. 8,957.69 194,459.46 126,606.83 33,649.00 363,672.98 The operations of the bank in domestic acceptances are shown in the following table: Domestic acceptances bought. Month. 30 days. 60 days. 90 days. Total. January $750,000 $750,000 February.. 250,000 250,000 March $750,000 $750,000 1,050,000 2,550,000 April 2,537,500 1,555,000 225,000 4,317,500 May 155,000 60,000 215,000 June 540,000 80,000 12,000 632,000 July 13,000 13,000 August 50,000 80,000 130,000 October 421,000 90,000 25,000 536,000 November. 50,000 50,000 December.. 451,172 110,000 378,800 939,972 Total. 4,904,672 2,635,000 2,843,800 10,383,472 The operations of the bank in purchased acceptances are shown in the following table: Total acceptances bought. Month. 30 days. 60 days. 90 days. Total. January $25,000. 00 $1,396,724.86 $1,421,724. 86 February.. $94,079.97 1,318,549.99 1,045,722. 40 2,458:352.36 March 750,000.00 800,000. 00 1,237,961.22 2,787!961.22 April 2, 734,500. 00 2,163,150.00 666,429.64 5,564:079.64 May 235,000. 00 170,042.58 646,008.11 951' 048.69 June 540,000. 00 80,000.00 12,000.00 632,000.00 July 13,000.00 13,000.00 August 840,411.53 2,269,253.63 3,109,665.21 September. 95,079.14 95,079.14 October 421,000. 00 90,000.00 25,000. 00 536, 000.00 November. 3,403,811.47 3,549,745.98 3,123,641.97 10,077,199.42 December.. 2,127,368.96 2,643,592.06 655,244.65 5,426,205. 67 Total.. 10,305,760.40 11,680,492.14 11,086,063.67 33,072,316.21 34365° Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

492 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. The following tabulation gives the average amount of acceptances held by months during the year, monthly earnings thereon, and average rate of earnings: Average amount of acceptances field. a A m v o er u a n g t e . Earnings. e A a r r v a n t e e i r n a o g g f s e . a A m ve o r u a n g t e . Earnings. e A a ra r v n t e e i r n a o g g f s e . January $6.422,500. 00 $15,519.41 2.84 August $1,410,700.00 $3,507.85 2.93 February 6,766,000.00 15,225.30 2.93 September... 3,228,900.00 8,414.58 3.17 March 5,823,500.00 15,591.46 3.15 October 2,482,800.00 6,492.01 3.08 April 5,387,300.00 13,404.23 3.03 November... 8,740.600.00 23,757.40 3.31 May i 4,149,900.00 11,933.80 3.39 December 9,608,200.00 28,368.91 3.47 June 1,671,800.00 4,379.74 3.19 July 744,600.00 1,935.99 3.06 Total. 4,703,100.00 „ I t The average holdings of municipal warrants bought and the average rate of earnings thereon are shown in the following tabulloaf tii ro\T\n *: Municip a I warrants. Average Average amount Average amount Average Month. hold during rate. Month. held during rate, month. month. January.. $550,500 2 98 September. SI, 400 3.81 February. 529.100 2^92 October 11,500 4.89 March.... 320 i 600 2.92 November.. 25,400 4.77 April 176,700 2.70 December.. 25,400 4.77 May 175,900 2.68 June 25,300 2.60 Yearly average. 153,500 2.91 Maturities of warrants purchased: 90 days $15,170.00 Over 90 days 161,893.64 Total 177,063. 64 The operations of the bank in United States bonds and Treasury notes are shown in the following table, giving the average amount held by months during the year and average rate of earnings thereon: United States bonds and Treasury notes. Average Average amount held Average amount held Average Month. during rate. Month. during rate. month. month. January.. $3,101,600 2.58 August S3,364,600 2.55 February 2, 656,100 2.79 September 3,649,700 2.70 March 2, 665,500 2.56 October 4, 352, 800 2.75 April 5,188, 600 2.38 November 3,851,100 2.76 M Jun a e y..... 5 5 , , 1 2 2 0 1 6; , 0 2 0 0 0 0 2 2 . .3 4 0 1 December 3,314,200 2.53 July. 3,529,900 2.61 Yearly average 3,833,400 2.56 The great usefulness of the gold settlement fund created in Washington by the Federal Reserve Board for the adjustment of balances Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT ISTO. 9—MINNEAPOLIS. 493 between the Federal Reserve Banks was clearly proven during the year. The following tabulation shows the average amount held for the credit of the bank and the average amount held for the Federal Reserve agent by months throughout the year: Average Average Average Average Month. a h m eld o u f n or t a h m eld o u f n or t Month. a h m eld o u f n o t r a h m el o d u f n o t r bank. agent. bank. agent. January. $6,799,000 $3,805,000 August $8,079, 000$5,500,000 February 5,506,000 3,250,000 September 6, 802,000 4,125,000 March... 7,644,000 3,190,000 October 6,874,000 15,700,000 April 8,192,000 5,220, 000 November 12, 754, 00016, 500,000 May 6, 075,000 4,224,000 December 15, 472, 00018,500, 000 June 9,686,000 5, 870,000 July 11,360,000 6, 250,000 Average holdings 8,770,250 7,677,833.33 FEDERAL RESERVE NOTES. The policy of the bank with respect to the issue of Federal Reserve notes remained unchanged during the year. Careful consideration was given to methods of promptly meeting the currency needs of the district, which were heavier than during the preceding year, and resulted in a corresponding increase in circulation. The bank was active in its efforts to attract gold to its vaults, with the result that its gold position was greatly improved during the year. The cooperation of member banks was a valuable factor in obtaining this result. The following tabulation shows the total of Federal Reserve notes received by the Federal Reserve agent from the Comptroller of the Currency, and details of the issue of new and used currency, the redemption of unfit notes and amounts of notes of the Federal Reserve Bank of Minneapolis returned to the Treasury Department and to the Comptroller of the Currency from banks other than the issuing bank: Record of Federal Reserve notes received from the Comptroller of the Currency since opening of bank, amounts issued, reissued and destroyed as of Dec. 31, 1917. Denomination. co R m e f p c ro e tr m i o v l e l d er. R b t y o e t a u b g r a e n n n e k t d . Is ( s b n u a e e n w d k ) t . o R ( e u b i s a s e n s d u k ) e . d s R b t f r y e o u t r u c a g t r d i n e o e e n - n d t . On hand. Fives $19,700,000 $5,937,000 $18,200,000 $2,882,000 $3,055,000 $1,500,000 Tens 24,240,000 2,470,000 21,920,000 775,000 1,695,000 2,320,000 Twenties 20,240,000 1,893,000 18,400,000 1,255,000 640,000 1,840,000 Fifties 1,400,000 140,000 880,000 130,000 10,000 520,000 Hundreds 2,400,000 190,000 1,490,000 180,000 10,000 910,000 Total 67,980,000 10,632,000 60,890,000 5,222,000 5,410,000 7,090,000 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

494 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. Record of Federal Reserve notes received from the Comptroller of the Currency since opening of bank, amounts issued, reissued and destroyed as of Dec, 31, 1917—Continued. Our unfit Denomination. o T r t t e h S h r R t e e e t u n a a e r r U o s t s n e F u t e n s e e r e r d i s e v d b t r e e e t y d o o ra f l c re o O b s t m y o u u n r u r p o o n r t t u r c t e e h o n e d s e l s f l r t . i e t o r d T e o s D t t 1 r e a o 9 c l 1 y . n 7 e 3 o . d 1 t , e to s D o T u e ( o a t c t s p . l a l t a 3 l a c 1 i n n o d , d o s ) 1 . i t t 9 s n e 1 s g 7 banks. Fives $1,209,005 $1,005,560 $5,269,565 $12,930,435 Tens 851,520 677,045 3,223,565 18,696,435 Twenties . . 374,000 335,420 1,349,420 17,050,580 Fifties 8,900 18,900 861,100 Hundreds 100 12,500 22,600 1,467,400 Total 2,434,625 2,039,425 9,884,050 51,005,950 FEDERAL RESERVE NOTE ISSUE FOR THE YEAR 1917. Fives: Fifties: New __ $9, 700, 000 New $700, 000 Used- 2, 000, 000 Used 80,000 $11, 700, 000 $780, 000 One hundreds: Tens: New 1,170,000 New 14, 480, 000 Used ___ 140, 000 Twenties: Total: 1,310,000 New __ 12, 960, 000 New 39, 010, 000 Used_ ._ 1, 000, 000 Used ___ 3, 220, 000 13, 960, 000 42, 230, 000 During the year 1917, a total of $39,010,000 in new Federal Reserve notes was issued, or double the combined issues of 1915 and 1916. Approximately, $10,000,000 of our note issue has been destroyed at Washington. There was a very material change in the denominations of notes issued during the year, 50 per cent more tens being issued than fives, and 34 per cent more twenties than fives. The percentage of fifties and hundreds issued was also much greater than in former years. Total cost of all notes issued during the year charged to expense was $43,735.82. Had the percentage of notes issued during 1917 remained the same as previous years our note cost would have been at least $10,000 greater. The notes of larger denomination were used in part to replace gold reserve held by country banks and sent us upon request. Total cost of all Federal Reserve notes issued since opening of bank, $72,303.15. Under the present arrangement with the Federal Reserve Board our order for notes to be held in reserve at Washington and in the subtreasury at Chicago is automatically maintained at $50,000,000. The table below indicates where our surplus notes are held and the various denominations: Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 9—MINNEAPOLIS. 495 Held in subtreasury at Chicago: Fives $5,200,000 Tens 1,960,000 Twenties 1,840,000 Fifties 200,000 Hundreds 800,000 Total— 10,000,000 Held at Washington (prepared) or in transit: Fives 5,480,000 Tens 2,280,000 Twenties 3,520,000 Fifties 1,600,000 Hundreds . 1,200,000 Total 14,080,000 Being printed at Washington: Fives 8,520,000 Tens 10,320,000 Twenties-: 6,480,000 Fifties 200,000 Hundreds 400,000 Total 25,920,000 Grand total— 50, 000, 000 The following tabulation shows the cost of new notes issued to Federal Reserve Bank: New notes issued to oank and cost. Cost of Federal Reserve notes issued to bank Nov. 16, 1914, to Dec. 31, 1916 $28,567.33 Amount issued $21,880,000. 00 Cost of Federal Reserve notes issued to bank Jan. 1, 1917, to Dec. 31, 1917 43,735.82 Amount issued 39,010,000. 00 Total cost charged oft* - $72,303.15 Total 60,890,000. 00 Amount of notes destroyed at Washington to Dec. 31, 1917 9,884,050. 00 Balance of notes fit for use on which all costs have been paid 51,005,950. 00 The following tabulation shows the cost of Federal Reserve notes: Cost of new Federal Reserve notes, including delivery in Minneapolis, per $1,000. Jan. 1 to Mar. 1 to From Feb. 28, Dec. 6, Dee. 7, 1917. 1917. 1917. Fives $1.97 $1.96 $2.07 Tens 1.12 1.08 1.23 Twenties . .62 .59 .67 Fifties .32 .32 .37 Hundreds. . .... .22 .22 .26 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

496 REPORT OF THE FEDERAL RESERVE BOARD. The cost of preparing notes to July 1, 1917, was $34.37 per 1,000 sheets. Since that date the cost has been $36.56 per 1,000 sheets, which with the increased postal rate brings about material change in the note expense. The interdistrict movement of Federal Eeserve notes of the issue of this bank is disclosed in the items in the following table, showing shipments received from other Federal Reserve Banks and shipments of the notes of other Federal Reserve Banks made to the respective sources of issue by the Federal Reserve Bank of Minneapolis: Interdistrict Reserve note movement. Boston. New York. Philadelphia. Re f c ro e m iv . ed Shipped to. Re f c ro e m ive . d Shipped to, Re fr c o e m iv . ed Shipped to. January... $13,000 $1,500 $81,300 $18,000 $9,000 $1,500 February. 8,000 2,000 50,400 28,000 4,000 2,000 March 6,400 1,500 24,800 19,000 10,000 1,500 April 6,000 15,800 10,000 4,000 May 8,800 24,800 21,000 5,000 June 7,800 10,700 23,500 9,000 July. 11,100 5,200 5,000 August 5,700 163,500 **i3,"66o" 17,000 September 17,200 95,300 13,000 October... 27,900 7,500 130,225 ""72," 000" 6,000 8,500 November 17,100 3,500 64,050 143,800 24,000 3,500 December. 13,200 178,300 42,500 16,000 Cleveland. Richmond. Atlanta. Ke fr c o e m iv . ed Shipped to Re fr c o e m iv . ed Shipped to. Re fr c o e m iv . ed Shipped to. January $7,300 $3,500 $2,000 $2,500 $2,500 February.. 6,700 5,000 3,000 $9,500 2,000 March 3,130 5,500 1,500 **5,"6o5" 14,350 5,000 April 4,100 8,450 May 2,300 3,000 7,050 J J u u n ly e 5 3 , - 0 5 0 0 0 0 7,000 "2,'666" 3 1 , ,9 7 5 5 0 0 5,000 August 13,500 2,000 6,750 September. 8,500 1,390 4,600 October 5,500 23,000 1,250 9,500 4,250 * 14," 500 November. 4,000 4,750 5,200 December.. 17,500 5,000 23,500 30,050 Chicago. St. Louis. Kansas City. Re fr c o e m iv . ed Shipped to. Re f c ro e m iv . ed Shipped to. Re fr c o e m iv . ed Shipped to. Januoxy $388,000 $4,000 $4,000 $23,300 $16,500 Febraury.. 124,000 8,000 $50,000 7,000 3,000 21,500 March 382,000 3,000 42,950 8,000 15,000 April 100,000 23,100 13,450 11,000 May 222,000 15,500 17,250 8,500 11,100 17,500 June 260,000 23,500 11,000 8,700 22,000 July 20,500 17,600 August 882,000 10,000 31,750 11,000 4,500 September. 213, 000 39,600 10,500 October.... 232,000 97,000 22,000 12,000 12,000 84,000 November. 264,000 29,000 35,500 7,500 21,250 19,500 December.. 351,000 29,500 34,650 4,000 17,500 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 9 MINNEAPOLIS. 497 Interdistrict Reserve note movement—Continued. Dallas. San Francisco. Re fr c o e m iv . ed Shipped to. Re f c ro e m iv . ed Shipped to. January $5,830 $5,500 $28,820 $15,000 February.. 3,370 3,000 20,980 21,000 March 11,000 7,000 24,390 21,000 April 4,500 17,070 May 7,250 ""7,"5O6" '""20*566 June 4,250 6,500 36,185 49,000 July 4,450 August 5,100 50,795 12,000 September. 6,555 October 3,000 23,500 13,630 64,000 November. 7,500 5,000 35,750 32,000 December.. 10,000 31,965 37,500 It has been the practice of the Federal Reserve agent's department throughout the year to maintain in the vaults of the bank an average amount of $5,000,000 in new and unissued Federal Reserve notes of the denominations chiefly required by the banks of the district and to request shipments from the reserve supply held by the Treasury Department in Washington to offset the amounts issued from time to time. The notes so held by the Federal Reserve agent, together with all gold and collateral standing against notes issued to the Federal Reserve Bank are carried in a special vault compartment, separate and distinct from the vault accommodations of the bank. Methods for handling and protecting such funds have been the subject of special study and investigation and are believed to afford the fullest possible degree of protection. The board of directors on May 7 authorized the adoption of a system of joint control as suggested by the Federal Reserve Board and authorized designated officers of the bank to join with the Federal Reserve agent or his representative in joint receipt for incoming shipments of Federal Reserve notes. It is worthy of note that notwithstanding the heavy demands made upon the Bureau of Engraving and Printing in Washington by the Government bond issues, it was able to supply this and other Federal Reserve Banks during the year with the largely increased volume of Federal Reserve notes required. As a consequence of some relief from the serious situation caused during the early part of the war by a lack of proper dyestuffs from which to manufacture the ink used in note printing, Federal Reserve notes shipped during the last half of the year show little difference in the quality of printing from those issued prior to the outbreak of the war. CHECK CLEARING AND COLLECTION. The volume of business handled by the transit department has shown a steady and substantial increase during the past year. The Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

498 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. average daily number of items handled during January. 1917, was 13,500, while at the present time the average number of checks handled each day is about 17,000, aside from the checks handled on Minneapolis and St. Paul banks through the Twin City clearing house. In order to facilitate the transferring of funds at the least expense, arrangements have been made to enable a member bank to draw Federal Reserve exchange and transfer drafts upon the Federal Reserve Bank of Minneapolis under restrictions and regulations as outlined by the Federal Reserve Board, and the drafts thus drawn will be received at par, without the making of time deduction, by other Federal Reserve Banks. The Federal Reserve exchange drafts are drawn for amounts not in excess of $250, and are receivable for immediate availability at par, at any other Federal Reserve Bank, but actually payable only at the Federal Reserve Bank of Minneapolis. The Federal Reserve transfer drafts are drawn upon the Federal Reserve Bank of Minneapolis, only for amounts in excess of $250, and are made payable at one other Federal Reserve Bank designated in the draft. The use of these drafts has given satisfaction where tried, although the number of banks that have taken advantage of the facilities offered by this plan has been rather limited. Several of the nonmember banks, in order to enjoy the privileges of the collection system, have opened accounts upon the books of the Federal Reserve Bank in accordance with the ruling of the Federal Reserve Board that items deposited by such banks might be collected with the same cost for handling as that made to member banks, wThen satisfactory arrangements for so doing were made with the Federal Rserve Bank. Owing to agitation which developed, due to opposition to the operation of the collection system of the Federal Reserve Banks, there was a slight reduction about the middle of the year in the number of banks on our par list. After amendments to the Federal Reserve Act were adopted, the effect was noticeable and a number of banks have since been added to the par list. At the beginning of the year there were 1,758 banks on the par list, while at the present time the names of 1,817 banks appear on this list, out of a total of 3,647 banks in the district. During the month of November, 1917, there were 16 banks added to the par list. Aside from the regular duties of the department was the inclosing and mailing out of most of the circulars and forms sent to banks in this district for use during the Liberty loan campaign. The figures for the Twin City clearing house (Minneapolis and St. Paul banks) show an unusually large increase in the amounts Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 9—MINNEAPOLIS. 499 handled during the past year, as the totals for the last few months in the year were practically double those of the first few months. The operations of the Twin City clearing house, by months, for the year 1917 were as follows: January $93, 682, 564. 00 July $104, 586, 009. 60 February 68, 039, 310.10 August 101, 855, 635. 42 March 96, 267, 099.14 September 125, 385, 293. 02 April 96, 050, 773. 02 October 170, 544, 464. 42 May 116, 374,189. 67 November 181, 307, 927. 75 June 109, 978, 634. 37 December 151, 454, 015. 61 The operations of the transit department showing the total clearings and collections for the year, by months, were as follows: Clearing statistics, 1911. Clearings. Member and nonmember. Month. Average Average Average Average Average Average n d u a m il b y e . r amount daily. p a e m r i o t u e n m t . n d u a m il b y e . r amount daily. p a e m r o it u e n m t . January... 2,277 $1,055,674.42 $463.68 10,271 $797,546.28 $77.65 February. 2,132 923,595.89 433.06 9,632 692,356.03 71.88 March.... 2,096 1,030,634.27 491.61 9,997 814,492.07 81.47 April 2,299 1,189,088.50 517.22 11,357 904,171.74 79.60 May 2,183 1,238,001.13 567.10 10,741 888,173.29 82.68 June 2,304 1,483,926.76 644.16 11,030 901,176.33 81.70 July 2,174 1,335,922.68 614.45 10,278 905,960.69 88.14 August... 2,081 1,295,372.21 622.30 9,589 833,410.72 86.91 September 2,269 1,561,717.41 688.02 11,478 1,045,212.09 91.07 October... 2,477 2,221,694.15 896.68 12,850 1,304,109.42 101.48 November 2,688 2,771,744.42 1,030.18 13,449 1,440,211.56 107.07 December. 2,654 1,789,968.28 674.25 13,680 913,243.00 66.73 Other reserve banks. Service Clearings. charge, Average out of number town of remit- Month. Average Average checks tance letn d u a m il b y e . r am A ou v n e t r a d g a e ily. p a e m r i o t u e n m t . = (l c i o c s e t n p t e s) r o te u r t s d s a e i n ly t . Number. Amount. $1,000. January $616,371.88 $890.16 11.6 1,073 59,220 $27,459,590.77 February... 597 594,398.22 996.17 11.9 1,080 46,919 20,319,109.75 March 558 658,076.86 1,178.17 10.7 1,095 56,604 27,827,125.54 April 617 573,856.79 929.59 12.1 1,115 55,176 28,538,124.10 May 623 1,020,155.22 1,637.77 8.9 1,128 56,769 32,193,762. 42 June 680 1.367,574.73 2,011.13 7.7 1,126 59,8G6 38,582,095.96 July 656 791,371.43 1,205.40 9.6 1,120 54,354 33,398,067.11 August 655 833,429.80 1,272.97 9.1 1,147 56,203 34,975,049.68 September. 749 1,779,613.06 1,940.80 10.2 1,164 54,477 37,481,217.99 October 847 1,827,319.26 2,158.06 6.5 1,159 66,886 59,985,742.21 November.. 907 1,932,426.19 2,128.69 10.0 1,152 67,171 69,293,610.53 December.. 953 1,593,328.07 1,670.78 8.4 1,173 66,368 44,749,207.07 Total. 700,043 454,802,703.13 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

500 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. Clearing statistics, 1917—Continued. Member and nonmember. Other reserve banks. Direct to members of other districts. Month. Number. Amount. Number. Amount. Number. Amount. January 267,046 $20,736,203.47 17,643 $14,782,932.49 360 $1,242,756.60 February 211,899 15,231,832.75 12,908 12,014,622.81 219 1,062,138.07 March 269,928 21,991,286.01 14,828 16,371,023.78 253 1,397,051.51 April 272,581 21,700,121.91 14,639 12,570,216.83 180 1,205,346.13 May ... 279,279 23,093,221.16 15,942 24,904,767.01 269 1,645,268.76 June 286,782 23,430,584.76 17,445 33,867,330.03 235 1,689,612.99 July 256,961 22,649,017.34 16,209 18,289,683.61 204 1,494,602.27 August 258,907 22,502,089.57 17,443 20,834,158.54 252 1,678,439.18 September 275,479 25,081,132.95 17,783 33,634,721.38 205 1,276,580.91 October 346,971 35,210,954.55 22,557 47,308,311.92 305 2,029,308.21 November 336,249 36,005,289.02 22,407 46,016,427.48 288 2,294,227.50 December 342,113 22,831,075.02 23,841 39,833,201.82 253 1,968,051.40 Total 3,404,195 290,462,808.51 213,645 320,427,397.70 3,023 18,983,383.53 OPERATIONS AS FISCAL. AGENTS. Under the authority of section 15 of the Federal Reserve Act, providing that Federal Reserve Banks shall, under direction of the Secretary of the Treasury, act as fiscal agents of the United States Government, a large volume of new work was added to the ordinary operations of the Federal Reserve Bank of Minneapolis during the year. Of this, the responsibilities in connection with the first and second Liberty loans hereinafter referred to, were of especial importance, but in addition thereto there was a rapid expansion alongother lines, and the bank was called upon to serve the Government in many new and untried ways. Among the most interesting operations of the year was the handling in the ninth Federal Reserve district of 13 successive issues of United States Treasury certificates of indebtedness, under allotments made by the Secretary of the Treasury. The widespread distribution of these certificates is shown in the following table giving the date of issue, classification, number of subscribers, and allotments in each class. United States certificates of indebtedness issued during the pear 1917. Num- Num- Num- Num- Allotment ber of Allotment ber of Allotment ber of Allotment ber of Date of issue. $25,000 and sub- $25,000 to sub- $50,000 to sub- $100,000 to subless. scrib- $50,000. scrib- $100,000. scrib- $250,000. scribers. ers. ers. ers. Mar 31 Apr 25 $250,000 39 $250,000 10 $350,000 7 $900,000 8 Apr 27 50,000 2 50,000 1 400,000 1 May* 10. 1,059,000 137 525,000 20 661,000 12 1,115,000 9 May 25 460,000 69 240,000 8 350,000 7 100,000 1 June 8 • 533,000 65 495,000 17 572,000 10 675,000 5 Aug 9 306,000 39 80,000 3 150,000 3 814,000 7 Aug 28 170,000 18 125,000 5 185,000 3 300,000 3 Sept. 17 175,000 26 150,000 6 225,000 4 300,000 2 Sept. 26 1,099,000 140 703,000 26 1,040,000 20 1,453,000 14 Oct 18 1,601,000 205 1,105,000 38 1,175,000 22 1,960,000 16 Oct. 24 840,000 i 500,000 17 640,000 11 840,000 Nov 30 198,000 190,000 7 180,000 3 Total 6,691,000 S57 4,413,000 159 5,578,000 103 8,857,000 73 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTEICT NO. 9—MINNEAPOLIS. 501 United States certificates of indebtedness issued during the year 1911—Contd. Date of issue. $ A $ 2 l 5 5 l 0 0 o , 0 t 0 , m 0 00 0 e 0 n t . o t N s o c u f r i m s b u e b b r e s - r . $ A $ 5 1 l 0 , l 0 0 o 0 , t 0 0 m 0 ,0 0 e 0 n t 0 o t . N sc o u r f i m D su b e b r e s - r . To m ta e l n a ts ll . ot- N s o c u f r i m s b u e b b r e - s r . Mar. 31.. $2,000,000 $2,000,000 1 Apr. 25.. $250,000 2,000,000 65 Apr. 27.. 500,000 4 Kay 10.. 1,140,000 4,500,000 182 May 25.. 250,000 1,000,000 2,400,000 88 June 8... 725,000 2,200,000 5,200,000 102 Aug. 9.. 1,550,000 800,000 3,700,000 57 Aug. 28.. 650,000 595,000 2,025,000 32 Sept. 17. 650,000 500,000 2,000,000 41 Sept. 26. 705,000 2,000,000 7,000,000 205 Oct. 18.. 250,000 3,450,000 9,541,000 286 Oct. 24.. 1,385,000 1,000,000 5,205,000 133 Nov. 30. 425,000 750,000 1,743,000 39 Total. 7,980,000 14,295,000 19 47,814,000 1,235 FIRST LIBERTY LOAN. In common with other Federal Reserve Banks, the placing of 3-J per cent bonds of the first Liberty loan presented to the Federal Beserve Bank of Minneapolis many new problems and necessitated the immediate creation of an organization and facilities for bringing the necessities of the Government generally to the attention of the I^eople, and providing for the sale and distribution of bonds over a very wide extent of territory and to an army of individual buyers. Under the general direction of the chairman and Federal Eeserve agent, such an organization was created, and a vigorous campaign was conducted in which the central committee received the hearty support of the member and State banks of the district, of the press, and of many business men who voluntarily gave up their own affairs to participate in committee work in their own cities and localities. The results of the first Liberty loan are shown in the following table: Subscriptions. Northern Michigan $6, 275,150 Minnesota 34,148, 400 Montana 16, 000, 500 North Dakota 3, 529, 850 South Dakota 3, 922,150 Wisconsin 3, 904, 400 Total $67, 780, 450 SECOND LIBERTY LOAN. Upon the basis of the experience gained in the first Liberty loan campaign, the organization and headquarters staff for the sale of 4 per cent bonds of the second Liberty loan issue was greatly expanded and improved. Under a resolution of the board of directors, a general executive committee was created, composed of a general chairman for the district and chairmen of State organizations in Montana, North Dakota, South Dakota, Wisconsin, and Michigan, Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

502 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. with representatives from the cities of St. Paul, Minneapolis, and Duluth. The board of directors named on the general executive committee the Federal Reserve agent and governor as representatives of the Federal Reserve Bank. The work in the State of Minnesota was handled from general headquarters in Minneapolis. Immediately following the creation of the general committee, the chairman and several of its members visited Washington and participated in a conference at the Treasury Department, in which the work of the Liberty loan organizations throughout the country was discussed. Under the supervision so provided, the organizations in the States were strengthened and perfected, and much attention was given to the creation, in the 300 counties of the district, of local county organizations under the direction of the respective State chairmen. This was found necessary in view of the difficult problem of selling bonds in the purely agricultural sections, where the work necessitated visits by committeemen from farm to farm and personal interviews with farmers. Great credit is due the general executive committee, to the heads of the State organizations, to the chairmen of the county organizations, and to the very large number of business men, professional men, bankers, and others who worked untiringly for the success of the loan. Without the hearty cooperation of every member of the large organization that was formed, the excellent results which are shown in the following tabulation could not have been obtained: Amount subscribed and number of subscribers to second liberty loan of 1917. $ $ 1 5 0 0 ,0 t 0 o 0. s N o c u r f i m b s e u b r b e s - r . $ $ 1 5 0 0 ,0 ,0 5 0 0 0 t . o s N o c u r f i m b su e b r b e s - r . $ $ 5 1 0 0 ,0 0 5 ,0 0 0 0 to . s N c o u r f i m b su e o b r e s - r . Michigan (northern peninsular).. $5,383,700 30,657 $1,175,550 48 $1,156,250 15 Minnesota 45,706,800 324,201 11,880,200 427 7,542,550 141 Montana 11,134,350 70,254 2,731,100 101 1,142,650 16 North Dakota 9,059,500 66,242 436,800 16 175,000 2 South Dakota 11,823,150 86,079 783,850 40 68,000 1 Wisconsin (northern one-third).. 6,364,100 43,378 1,429,550 58 200,000 2 Total 89,471,600 620,811 18,437,050 690 10,284,450 177 $100,050 to Number Over Number Total Total $200,000. of sub- $200,000. of sub- sub- subscribers. scribers. scribed. scribers. Michigan (northern peninsular).. $1,280,000 10 $500,000 1 $9,495,500 30,731 Minnesota 6,147,450 41 8,515,000 20 79,792,000 324, 830 Montana. 1,049,700 7 3,694,100 5 19,751,900 70,383 North Dakota 200,000 3 430,000 10,301,300 66,263 South Dakota 250,000 1 12,925,000 86,121 Wisconsin (northern one-third)... 653,300 4 8,666,950 43,442 Total . 9,330,450 65 13,389,100 27 140,932,650 621,770 During the first Liberty loan campaign the problem of reaching the scattered population in districts that were wholly agricultural was very hard to solve. There was a noticeable lack of information Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 9—MINNEAPOLIS. 503 among the farmers upon the position of the United States in the war and the problems created by the entrance of this country into the conflict. This obstacle was to some extent overcome during the period between the first and second Liberty loan campaigns. In the second Liberty loan campaign the results in the farming districts were much more satisfactory and the agricultural population in all of the States of the ninth district responded heartily and in a highly patriotic manner. The first campaign demonstrated that it is practically impossible to sell bonds in farming districts without intensive organization providing for the careful canvass of each county and township, and for personal solicitation from farm to farm. In the second Liberty loan campaign the success of this method of reaching the farmers was clearly proven by the fact that only 859 bond buyers out of a total of 621,770 purchasers bought bonds in denominations larger than $10,000. The great bulk of all the bond sales was in small-denomination bonds and the response of the agricultural portions of the district, as shown by the returns from the various counties, indicated that the farmers in all parts of the district had purchased freely. Upon the basis of population Liberty bonds were sold to a fraction more than 14 per cent of the population of the ninth Federal Keserve district, as compared with a general average for the United States as a whole of 9.4 per cent. Liberty bonds of the second issue found their way into 70 per cent of all the families in the ninth Federal Keserve district. An especially interesting feature of the second campaign was the very wide distribution of either bonds or participating certificates to the school children at some of the more important centers. In Minneapolis every child out of 65,000 of the school population was the purchaser of a bond or participating share in a bond. There was a noticeably satisfactory sale of the smallerdenomination bonds to laboring men and wage earners in the larger cities, and the response of the employees of concerns maintaining large forces was very encouraging. CHANGES IN STAFF. The very rapid growth in the volume of business handled by the bank necessitated numerous changes in the staff during the year, and also the expansion of the clerical forces in the various departments. Pursuant to the action of the board of directors, Mr. Frank C. Dunlop, auditor, was made assistant cashier on January 8. Mr. Howard H. Hall, paying teller, was made auditor. Upon the same date, Mr. J. E. Mitchell, president of the Capital National Bank, St. Paul, was elected by the board of directors to represent this bank upon the advisory council for the year 1917. Upon February 5 the directors designated Mr. C. T. Jaffray as acting governor in the ab- Digitized fosr eFnRcAeS EoRf the governor of the bank. On August 6 Mr. Gray Warren, http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

504 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. manager of the transit department, was made assistant cashier, and Mr. H. C. Core was made manager of the transit department. On October 19 Mr. R. A. Young, of Houghton, Mich., was appointed as assistant to the governor, and upon October 31 Mr. C. L. Mosher was appointed by the Federal Reserve Board as assistant Federal Reserve agent. BOARD OF DIRECTORS. The policies previously laid down by the officers and the board of directors have been pursued practically unchanged throughout the year, except as the expanding business of the bank, the creation of new departments to handle the largely increased amount of Government business and considerable additions to the staff, have made minor alterations necessary. The sessions of the board of directors throughout the year were well attended, and the affairs of the bank and its progress were considered in detail. The members of the board individually pursued the policy of making occasional visits between directors' meetings to personally familiarize themselves with the operations of the various departments, and the progress of the work of the bank. Sessions of the board were marked by complete harmony and by a praiseworthy spirit of cooperation. Pursuant to law, elections were held in November, in consequence of the expiration of the terms of Mr. Norman B. Holter and Hon. L. B. Hanna, who were reelected by the member banks authorized to vote, to serve for terms of three years each from December 31, 1917. STAFF AND CLERICAL FORCE. There is displayed in the lobby of the bank a roll of honor, bearing the names of the following, who have answered the call of their Government, and have volunteered for service, or who are abroad with the Canadian forces: C. L. G. Blix, Lyndon A. Tonseca, Levi C. Jackson, Garrett T. Mandeville, Kenneth Lyford, Stephen P. Podany, David A, Rossman, James C. Smith, Leonard A. Roberton, and Harold A. Wright. RESULTS OF THE YEAR'S OPERATIONS. The satisfactory results of the year's operations are shown in the following table, giving comparative gross earnings by months for 1916 and 1917. Gross earnings by months. 1917 1916 1917 1916 January.. $32,120.87 $11,471.21 August $60,826.02 $25,074.83 February 31,310.36 10,909.70 September. 70, 234.08 27,170.94 March 31,094.02 11,724.58 October 58,688.36 30,212.02 April 34,081.81 12,480.69 November. 83,835.51 28,660.58 May 43,184.05 15,782.63 December. 93,589.13 27,116.39 June 39,952.37 17,154.86 July 49, 421.86 20,350.25 Total 628,338.44 238,108.68 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT ISTO. & MINNEAPOLIS. 505 The condition of the bank is shown in detail in the following comparative statement as of December 31, 1915, 1916, and 1917: Dec. 31,1917. Dec. 31,1916. Dec. 31,1915. RESOURCES. Bills discounted and collateral loans to members $8,082,327.78 $1,985,182.75 $1,244,615.71 Bankers' acceptances 7,166,677.76 6,199,999. 55 477,806.40 Rediscounts for other Federal Reserve Banks 4,988,121.23 United States securities 3,228,490.00 3,178,687. 85 1,328,820.00 Municipal warrants 25,380.00 569,664. 72 910,513. 28 Accrued interest on United States securities 17,841. 63 15,607. 73 6, 473.42 Furniture and equipment (including vault and safes) 29,501.00 59,274.19 54,159.64 Organization expenses 32,341.71 Cost of Federal Reserve notes, unissued 12,915.48 16,295.18 19,932.85 Expenses paid in advance 2,127.12 1,250.00 Disbursements for Treasury Department (to be reimbursed) 54,126. 89 Due from other Federal Reserve Banks 13,247,610.72 3,598,997.07 4,390,694.20 Due from banks and bankers, also deferred debits to member banks 4,403,830.21 3,449,929.61 National-bank notes and Federal Reserve notes, other banks 169,361.00 18,800.00 8,945.00 Federal Reserve notes on hand 1, 420,865.00 2,374,585.00 868,390.00 Mutilated Federal Reserve notes, forwarded for redemption. 171,000.00 Other lawful money 413,165.61 179,552.47 21, 416.95 Gold certificates and gold coin 15,837,955.00 8,775,637.00 2,747,298.00 Gold held with foreign agency 2,100,000.00 Gold in settlement fund 19,486,500.00 7,064,000.00 4,355,000.00 Gold with Federal Reserve agent. 32,909,950.00 20,484,045.00 14,000,000.00 Total. 113, 767,746. 43 57,971,508.12 30,466,407.16 LIABILITIES. Capital :.. 2,620,150.00 2,609,700.00 2,546,850.00 Profit and loss 75,157.13 44,541.27 Discount and interest unearned 94,280.60 36,274.45 18,963. 25 Discount and premium on United States bonds.. 20,682.39 22,534. 74 7,069.14 Withheld for Federal income tax 176.25 Reserved for abrasion on gold 6,500.00 Government deposits 8,716,529. 47 886,437.51 Cashier's checks. „ 31,488.47 5,680.45 1,822. 20 Due to other Federal Reserve Banks 10,524,486.54 4,347,156.58 26,340.33 Due to member banks 40,603,711.83 29,534,961.87 13,865,362.24 Due to nonmember banks 68,810.00 Federal Reserve notes outstanding 51,005,950.00 20, 484,045.00 14,000,000.00 Total. 113, 767,746. 43 57,971,508.12 30,466,407.16 PROFIT AND LOSS ACCOUNT, DEC. 31, 1917. Balance in account, Jan. 1, 1917 $44, 541. 27 Gross earnings, Jan. 1, 1917, to Dec. 31, 1917 $628, 338. 44 Less : Assessment for expenses Federal Reserve Board $10, 196. 14 Cost of Federal Reserve notes issued during year and redemption expense 43, 735. 82 Operating expenses 114, 904. 96 168, 836. 92 Excess of earnings over current expenses 459, 501. 52 Total 504, 042. 79 Less the following items charged off: Reduction of furniture and equipment $41, 364. 25 Reduction of bonds to market value 15, 000. 00 Reserved for abrasion on gold 6, 500. 00 Dividends for period July 1, 1915, to Dec. 31, 1917 366, 021. 41 428, 885. 66 Balance carried forward 75,157.13 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 10—KANSAS CITY. CHARLES M. SAWYEK, Chairman and Federal Reserve Agent. FINANCIAL RESULTS OF OPERATION. It will be recalled that the operations of the Federal Reserve Bank of Kansas City during the year 1916 were confined largely to openmarket transactions due to the lack of demand from member banks for rediscount privileges. As compared with the experience of the year 1916 and previous years, the investments of the Federal Reserve Bank, acquired during the year 1917, have been largely made up of paper discounted for member banks in the district; and open-market transactions have been practically discontinued during recent months. This changed condition is due to seasonal needs, shifting balances in the flotation of Liberty loans, the development of a closer relation with the member banks, and a better appreciation of the discount facilities afforded them. In general the proportion of demand to supply of funds has been more pronounced than in the year 1916. The net earnings for the year 1917 have been approximately 20 per cent of the paid-in capital. Within the year, dividends to stockholding members have been paid to June 30, 1916, and out of the cumulative earnings there have been declared dividends to June 30, 1917, inclusive, payable December 31, 19^17. After disposing of asset accounts, covering premium on United States bonds and furniture and equipment, there will remain, to cover any depreciation and for further disposition, a substantial sum of undistributed earnings. Schedules AA and A, made a part of this report, will show an account of earnings and expenses, and an analysis of the income— profit and loss account for the year 1917, as compared with previous years. While the comparative figures exhibit a healthy increase in the earning capacity of the bank, operating expenses for the year have increased approximately but 15 per cent. There is provided in Schedule B a comparative detailed statement at the close of the year 1917, as well as comparative figures for the two previous years, which reflect the development of the institution within the past year. Noticeable, is the increase in member banks' discount transactions and the augmented volume of reserve balances. The increased reserves are due not only to the amended reserve requirements, effective during the year, but to the greater volume of deposits held by member banks. 34365°—18 33 507 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

508 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. Schedule B will also show the decreased holding of gold coin and gold certificates in vault. This is due to the shipment thereof for concentration purposes to the subtreasury for credit of the Federal Reserve Bank in the gold settlement fund. The amendment to the Federal Reserve Act relieving member banks from holding gold coin or certificates as a part of their reserve makes it unnecessary for the Federal Reserve Bank to accumulate such classes of money on hand in vault. The policy of aiding the concentration of gold has been persistently followed during the entire year by three progressive steps as follows, the Federal Reserve Bank first absorbed transportation charges on coin and certificates when shipped by member banks; later continued this service extending the same to nonmember banks and agreeing to ship in exchange Federal Reserve notes at the expense of the Federal Reserve Bank; and, lastly, for a short period of time, absorbed the abrasion on gold coin shipments. The result of this policy has brought into the system not less than $18,000,000 gold, INVESTMENT OPERATIONS. In contrast with the experience in 1916, the larger volume of discounts for the present year has been received from the member banks located in reserve cities rather than from points outside, although the class of paper offered either for rediscount or as collateral to member bank notes, continues to consist largely of agricultural and live-stock loans. The industrial and commercial paper materially increased, and gradually the trade acceptance is being offered more frequently. The member bank 15-day collateral notes have been popular, and these were held, at periods, in larger quantity than other paper when banks sought temporary relief to care for shifting balances or meet immediate needs. This class of paper has been freely used by member banks seeking short advances on Government securities, and yet 15-day collateral notes, otherwise secured, have been three times as large in volume as the same class of paper secured by Government bonds, certificates, or notes. The steady increase in rediscounts of member banks from January to the end of the year is noticeable in Schedule C of this report, in which a record of rediscounts, maturities, volume of business and the nature of the paper is exhibited in detail. During the early part of the year a considerable amount was kept invested in bankers' acceptances through the Federal Reserve Banks of New York and Boston, but in August it became apparent that the bank would have a greatly increased demand from its member banks, and these purchases were temporarily discontinued. While the development of the trade acceptance as a credit instrument is still slow Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT KO. 10 KANSAS CITY. 509 in this district, increased interest in this manner of handling trade credits is evidenced by frequent inquiries from wholesale and manufacturing institutions, and requests of the officers of the bank to address meetings or enter into correspondence with commercial concerns on the subject. Discount rates within the year have advanced slightly on some classes of paper, although, generally speaking, they have been stable. Schedules D and E of this report cover in detail the open-market transactions. There has been but little change in the bank's holdings of Government securities during the year, a detailed record of which is shown in Schedule F. A recapitulation of investment transactions for ready review is furnished in Schedule G. The reserve position of the bank has continued strong throughout the year, notwithstanding the increased demand, and a detailed record thereof, by months, is reflected by Schedule H. A new source of revenue was provided by the discount for member banks, offering of miscellaneous bank-draft exchange in limited quantity. Within the past few weeks there have been purchased daily sums from $1,000,000 to approximately $4,000,000, with an average outstanding of from $3,000,000 to $8,000,000 of this class of offering. The average revenue has been about $500 per day. These offerings have consisted wholly of drafts on banks located at points outside of Federal Beserve cities (where the exchange quotations of the bank obtain), such drafts having been in sums of $1,000 or more. Such transactions have been under the absolute daily control of the Federal Eeserve Bank. MEMBER BANKS. The movement of member banks within the district is fully exhibited by Schedule I of this report. It will be observed that there is a net increase in the number of member banks in district No. 10. Of these six consist of State bank and trust company members added within the year, as follows: Colorado: International Trust Co., Denver. Kansas: Fairview State Bank, Fairview; Morrill & Janes Bank, Hiawatha; Southwest State Bank, Wichita. Missouri: Commerce Trust Co., Kansas City. Nebraska: Pender State Bank, Pender. There have been no changes in the membership in 1917 by reason of transfers to or from other districts, and it is gratifying to report that there have been no failures of member banks. Eelations continue cordial between the officers and directors of the bank and those who have controlled the member banks. Schedule J is a record of the net reserve deposits by months. Notwithstanding the penalties, deficient reserves continue to aggregate Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

510 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. a considerable amount each month. By far the larger number of banks have fully acquainted themselves with this provision, the necessity therefor, and the accounting method used in ascertaining reserve balances. They have prided themselves upon keeping with the Federal Reserve Bank collected and available funds equal to or in excess of the reserve requirement at all times. The month of January, 1917, was the first month the penalties were actually applied, and 12 per cent of the member banks were deficient. Prior to the amendment of the reserve requirement, effective for practical purposes on July 16, 1917, this had decreased to 4 per cent. The amended reserve requirements and new method of computing reserves were confusing to a number of the banks, and for the last half of July, 16 per cent thereof were deficient. Since the balance of the year has not shown a decided increase in this percentage, but an increase in the total of penalties, the directors of this bank adopted for next year a progressive charge, increasing at the rate of | per cent for each succeeding offense within the year. Because of misunderstandings in the reporting of deposits subject to reserve requirement, and occasional errors, a rebate of all or a portion of penalties charged has been made to various banks, after the facts were developed with certainty that the reserve balance was ample within the period. While the member banks maintain full reserve balances in most instances, but few have made use of the Federal Reserve Bank as a correspondent to the extent of drawing drafts against balances and reimbursing the same by daily remittances. The drafts drawn are usually for transfer purposes. A complete file of reports of examination of member banks is maintained in the credit department, and each report, as received from the chief national bank examiner, is briefed for the ready information of those officials to whom this privilege is authorized by the Comptroller of the Currency. In addition thereto reports of earnings and dividends, by request of the comptroller, are furnished by all members semiannually and add to the facilities of discount operations. Copies of all reports of condition on call of the comptroller are also received and filed after complete statistics are compiled therefrom. In all States in which there are member State banks or trust companies, the directors of this bank have found examinations made by State authorities acceptable, thus avoiding a duplication of examinations. STATE BANKS AND TRUST COMPANIES. A recent tabulation of the eligible State banks and trust companies in this district indicates that the number is about 760, with an aggregate capital and surplus in excess of $50,000,000. If it were possible Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 10 KANSAS CITY. 511 to secure this additional membership, the present paid-in capital of the Federal Reserve Bank of Kansas City would be increased about 50 per cent, and it is believed reserves would be increased in about that proportion. By far the greater number of eligible State banks and trust companies are located in Nebraska, and the establishment of a branch at Omaha, with its growing activities, has brought about a lively interest in the question of membership of those banks. In fact, following the recent appeal of the President, inquiries have been numerous from all parts of the district, and while but six State bank members have been added during the year to the three which had previously joined, careful investigation is being given to the subject and several applications are expected. Practically all questions respecting the legal right of State banks to invest in the stock of the Federal Reserve Bank have been disposed of either by special acts or opinions of State counsel. Counsel for this bank long since rendered the opinion that there were no laws in any of the States of the district which either by express terms or necessary implication precluded State banks from becoming members. Every inquiry received in connection with this matter has been promptly replied to and the inquiring bank furnished with such literature as was available, with an invitation to submit any special questions that might occur, and correspondence is being carefully followed up. Many State banks with a capital equal to or greater than those of national banks located at the same points can not now become members of the system, because of the growth of their communities since the organization of the bank, and are urging a change in the law which now requires them to increase their capital to become eligible for membership while national banks in the same locations are not required to do so. The large number of ineligible State banks in this district is made obvious from the fact that out of a total of nearly 3,000 State banks and trust companies but 760 are eligible under the law. PUBLIC RELATIONS. There has been a marked improvement during the year in the attitude of the public generally, and particularly of the officers of banks, toward the Federal Reserve system. From the time the bank was established to the time of the declaration of war there had been such a redundancy of funds that many bankers and a considerable part of the public did not appreciate the extent to which the Federal Reserve system contributed to the stability of business, and there was an inclination to criticize. Now, those who were the strongest objectors are in many cases the most ardent supporters. It is difficult to find anyone who does not freely acknowledge the Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

512 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. great service rendered to all business interests and to the Government. There have been but few group meetings of bankers and conventions of State bankers' organizations that have* not been attended and addressed by some officer of this bank, and the relations between this bank and the bankers of the district are becoming more and more cordial. Our monthly reports of general business conditions have furnished reliable information to banks and newspapers throughout the district. The volume of business covered by the operations of the bank as fiscal agent of the Government will be found in Schedule K. This shows a great increase over the preceding year as the result of war activities. FIRST LIBERTY LOAN. The designation by the Secretary of the Treasury of Federal Keserve Banks as agencies to receive applications and perform the office of fiscal agents, and the issuance by the Secretary of the official prospectus under date of May 14, pursuant to the act of Congress approved April 24, came only a short time prior to the launching of the campaign for the first Liberty loan. An executive committee, consisting of the officers of the Federal Reserve Bank of Kansas City and a number of prominent commercial and investment bankers, was promptly appointed, established headquarters and proceeded, with the organization of the publicity and distribution work. The publicity division worked in cooperation with the director of publicity in Washington and endeavored to keep the entire district advised of the progress of the campaign and suggested ideas. This division also distributed posters and other display matter received from the Treasury Department. The distribution division worked through the 4,000 commercial banks of this district, and the local organizations for campaign purposes were left in the hands of the bankers. It can be said to the credit of the bankers in the district that they gave unsparingly of their time and energies and met with success, despite the fact that district No. 10 is not an investment territory and the proposition was new to the bankers on whom devolved the responsibility for educating the public. It must also be borne in mind that conditions here vary from those in the East in that the wealth is invested and is not surplus. The quota allotted to district No. 10 was $100,000,000, based on a total issue of $2,000,000,000; the quota for the second loan was determined, on an aggregate issue of $3,000,000,000, at $120,000,000. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 10 KANSAS CITY. 513 Against this quota subscriptions in the district from approximately 239,000 subscribers aggregated $93,866,650. SECOND LIBERTY LOAN. Submitted herewith is a chart which at a glance gives a comprehensive idea of the plan of organization for the second Liberty loan for the entire district. That part of the district comprising the States of Kansas, Missouri, and Oklahoma (portions of States within district) was handled through the headquarters office at Kansas City. The chairman for each State working from the headquarters office appointed various district chairmen throughout the State along congressional district lines, and those district chairmen appointed chairmen for the various counties in their respective districts. The county chairmen had entire charge of the organization in their respective counties. The States of Nebraska and Wyoming, comprising territory assigned to the branch of the Federal Eeserve Bank located at Omaha, was handled on a similar organization plan by the branch bank. This is also true for the States of Colorado and New Mexico, comprising territory allotted to the contemplated branch at Denver. Acknowledgment is due the State organizations under the American Bankers' Association, various State banking associations, Council of National Defense, 4-Minute Men Speakers' Association, and the women's organizations, for their splendid assistance throughout the campaign. In the second campaign, as in the first, the success is attributable to the zeal with which the bankers cooperated, as through their efforts assistance of workers was obtained representing all vocations and commercial, industrial, and agricultural activities. A large portion of the territory in district No. 10 is rural, and it was found much easier to conduct successful campaigns in the cities than to reach the rural communities. While some of the rural communities made a good showing, as a general proposition the fullest possibilities were not realized. It is gratifying to observe, however, that the rural communities are undergoing a change of sentiment and becoming awake to the necessity of their fullest cooperation, so that we anticipate much better results in the succeeding campaigns. The quota of the second Liberty loan allotted to district No. 10 was $120,000,000 and subscriptions were obtained from approximately 472,000 subscribers, aggregating $150,125,750. The expense of the campaign was held well within the percentage allowable for a selling effort of this magnitude and strict economy was practiced in every department. The total allotment of bonds to subscribers to the first and second Liberty loans in this district was $200,000,000. The banks are carrying only a comparatively small amount as owners. The bonds have Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

514 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. been absorbed by the general public and during the operation, bank deposits have increased, commercial needs have been supplied with funds at reasonable rates of interest and business has continued to improve in a normal way. The district organizations are being maintained intact, so that the subject of war financing may be kept continuously fresh in the minds of the public, and ready on short notice to enter upon another selling campaign with the maximum of efficiency. SUBSCRIPTIONS, ALLOTMENTS, AND DISTRIBUTION. The following table shows subscriptions and allotments for the first and second Liberty loans and distribution of allotments between member and nonmember banks. Distribution. Subscriptions. Allotments. Member Nonmember banks. banks. First Liberty loan $93,866,650 $65,774,300 $43,503,000 $22,271,300 Second Liberty loan. 150,125,750 136,630,000 89,990,450 46,639,550 The number of subscribers previously referred to (239,000 for the first Liberty loan; 472,000, second Liberty loan) shows the wide distribution among individuals and corporations, although figures are not available for classifying the distribution. EXPENDITURES. The expenditures in detail are given in the table below, separated as to the first and second loans. First Lib- Sceond Liberty loan. erty loan. Salaries—clerical force, special officers, and watchmen. $8,850.18 $24,156.22 Expressage 55.38 81.19 5,452.71 2,570.80 Printing and stationery 5,110.62 5,036.54 Light, heat, and power 18.45 108.45 Rent 550.00 329.85 Insurance and premium on bonds. 1,404.73 15.81 Publicity department 17,933.46 25,896.34 Traveling expenses 243.35 332.94 Telephone and telegraph 1,088.28 1,789.53 Repairs and alterations 371.71 635. .50 Furniture and equipment 2,728.85 2,780.20 War savings department 2,296.24 All other expenses 878.13 Total. 44,685.85 66,035.61 Of the amounts shown in the above total, $27,722.14 of reimbursements have been made by the Treasury Department. Reimburse- Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 10 KANSAS CITY. 515 ment is retarded by the necessity of preparing detailed vouchers for the Treasury Department and the slowness with which the committee chairmen throughout the district file vouchers with the Federal Reserve Bank. In considering the expenditures, it will be borne in mind that there is a continuous expense in the maintenance of the fiscal agency department which takes care of the accounting and distribution in all matters appertaining to the fiscal agency function. This department is divided in subdepartments, which, in general, may be stated as follows: Executive, audit, accounting general, delivery, exchange and conversion, depositary and securities, war savings, and Government teller. The total number of employees engaged at the time of this report is 80, with a pay roll of approximately $7,500 per month. TREASURY CERTIFICATES OF INDEBTEDNESS. The sale of Treasury certificates met with good success in the district. Practically all sales were made direct to banks, which used them in making payments on bond subscriptions. Ease was thus assured and any material disturbance in banking circles and conditions on the various payment dates avoided. There is given below a table showing certificates allotted to the various groups. The groups have been arranged to give an idea of the distribution of allotment. Number of Amount allotted to subscriber. sub in s c e r a i c b h ers To a t l a l l o t a t m ed o t u o nts group. each group. $25,000 and less $16,334,000 Over $25,000 to $50,000.. -. 11,936,000 Over $50,000 to $100,000... 10,175,000 Over $100,000 to $250,000.. 12,533,000 Over $250,000 to $500,000.. 11,141,000 Over $500,000 to $1,000,000 6,750,000 Total 2,075 68,869,000 " NOTE ISSUES. The policy of encouraging the use of Federal Reserve notes, and of obtaining an accumulation of gold and gold certificates thereby, has been continued through the year 1917. The Federal Reserve Bank of Kansas City has for some time past shipped to both member and nonmember banks Federal Reserve currency in exchange for gold and gold certificates, absorbing the transportation costs both ways. In order to have an ample supply of notes available for issue at all times, it has been the custom of the Federal Reserve agent and the board of directors of this bank, to keep in vault approximately $10,000,000 of unissued notes, and an additional supply of about Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

516 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. $12,000,000 at the subtreasury in St. Louis for overnight call in case of emergency. The Federal Reserve Board has been requested to keep printed, subject to requisition, a maximum amount of $75,000,- 000 and a minimum of $50,000,000. This bank has always been in a position to meet the fluctuating needs of the member banks of the district, and by reason of the ready supply of currency has undoubtedly facilitated banking operations and stabilized conditions. The total of Federal Reserve notes received from the Comptroller of the Currency for the year 1917 has been at least 75 per cent greater than the total heretofore, and the total of notes issued to the bank in 1917 was more than three times that of 1916. The total of Federal Reserve notes received from other districts was almost twice as large this year as in 1916. The demand for this increased issue has not been traceable to any abnormal conditions, but is partly accounted for by an approximate acquirement of gold and gold certificates, and further due to the marked increase of business and banking activities within the year. The Federal Reserve Bank has collateralized the issue of notes of this district at all times by a much larger deposit of actual gold than of commercial paper. The present note-issuing power of this bank is about $100,000,000. It is noticeable that approximately twice as many notes in the denomination of $5 have been used as in denominations of $10 and $20, which would confirm the conclusion that Federal Reserve notes have become the current medium of active business exchange. Almost a third of the $5 and a sixth of the $10 notes, issued since the organization of the bank, have been returned for destruction because of mutilation, indicating that the smaller denominations have had much the greater activity and consequently shorter life. No attempt has been made to determine with a degree of certainty the life of a note, but an estimate, based on the statistics available, indicates that the life of the $5 denomination is about one-half that of the $10, oneeighth of the $20, and but a hundredth of a $100 note. Schedule L will exhibit the Federal Reserve notes received by the Federal Reserve agent, the amount on hand, the amount destroyed, the amount issued, and provisions for redemption. Schedule M shows by denominations the total amount of Federal Reserve notes received from all sources by the Federal Reserve agent, and the amounts of mutilated notes destroyed since organization, as well as the amount remaining in his hands. It likewise indicates the total amount of such notes issued from the beginning. During the early part of the year arrangements were perfected for the cancellation and return of mutilated Federal Reserve notes to the Treasurer of the United States with the result that they are handled as rapidly as received and assorted. Arrangements have Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 10 KANSAS CITY. 517 also been perfected for the direct shipment to the Treasurer of the United States by other Federal Beserve Banks of mutilated notes of this bank's issue, thus avoiding the expense of rehandling. Schedule N reflects the trend in the circulation of the notes of this bank among the banks in various sections of the country, as well as the extent to which similar notes from other districts are received at this bank. As the travel of notes reflects to some extent the travel of individuals from one district to another, a study of this table is interesting; it indicates a travel from this district to other districts much greater than from a number of the other districts to this one. Schedule O gives a record of the notes issued within the year and the cost of issue of the several denominations. The average of all denominations was 96 cents per $1,000, and the average of notes of this district returned by other Federal Eeserve Banks was approximately 23 cents per $1,000. All Federal Reserve notes manufactured since July 1, 1917, will cost the bank a higher rate, increasing the average cost to approximately $1 per $1,000. At the close of business December 31, 1916, the Federal Eeserve Bank of Kansas City held in its vaults, issued and uncirculated, $6,000,000* of Federal Eeserve Bank notes, for which it had deposited an equivalent amount of United States bonds to secure the circulation. With the increased demand for currency and the investment activity within the past year, it was deemed wise to convert these notes into gold by placing them in circulation, which operation has been consummated. MANAGEMENT. No change has been made in the fixed meetings of the board of directors on the second and fourth Thursdays monthly, and these meetings have generally had all members in attendance. The members of the board have been vitally interested in the operations of the bank as regularly reported to them, and matters of policy have been freely and earnestly discussed, as well as the operations affecting the bank as the fiscal agency for the Government. The local board has been kept in touch with the plans and policies of the Federal Eeserve Board by a full report thereof at each meeting. Thorough discussions have been had on all matters of importance, and final action has in nearly every instance reflected practically the unanimous sentiment of the directors. While the executive committee for a short period of more or less inactivity discontinued daily meetings, their resumption appeared important under the new conditions arising, and the committee now convenes daily at 11 o'clock a. m. At these meetings discount and investment operations are given careful scrutiny, and during the interim between regular meetings of the board of directors, all mat- Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

518 ANNUAL EEPOBT OF THE FEDERAL RESERVE BOARD. ters of policy, changes in discount rates, as well as matters of routine, are given the necessary attention. A report of the proceedings of these meetings is submitted at the regular meetings of the board of directors for review and approval by proper procedure. The official staff now7 consists of the governor, chairman of the board, who is also Federal Reserve agent, deputy governor, secretary-cashier and two assistant cashiers; the addition of three officers having been made necessary by a decided increase in the volume of business transacted in addition to the operations of the fiscal agency department. The duties of the officers in chief remain unchanged. The member of the advisory council of this district continues to meet with the board of directors from time to time for the discussion of matters under consideration at sessions of the council. The number of officers and employees and the monthly salary expense in the different departments of the bank proper are set forth in schedule P. Effective January 1, H. W. Gibson, of Muskogee, Okla., was elected class B director, succeeding L. A. Wilson, who resigned; and M. L. McClure, of Kansas City, Mo., was reelected as class B director. Charles M. SawTyer, chairman of the board of directors was reappointed as Federal Reserve agent, and Fred W. Fleming was reappointed as vice-chairman and deputy Federal Reserve agent. The amendment to the act having abolished the office of deputy Federal Reserve agent, and having provided for the appointment of an assistant Federal Reserve agent, to become actively engaged in the daily operations of the office of the Federal Reserve agent, on January 31, 1916, M. A. Thompson was appointed to this latter position. The election just held resulted in the renaming of C. E. Burnham and H. W. Gibson as class A and B directors, respectively. The following official staff w7as elected at the regular annual meeting: E. F. Swinney. member of the advisory council, reelected; J. Z. Miller, jr., governor, reelected; J. L. Cross, previously assistant to the governor, was elected as deputy governor: and Arch W. Anderson, secretary-cashier, reelected. The election of C. A. Worthington as assistant cashier occurred June 29, 1917, and on October 12, 1917, M. A. Thompson, formerly assistant Federal Reserve agent, was elected assistant cashier. The position of assistant Federal Reserve agent was filled by the appointment of C. K. Boardman on October 31, 1917. The organization of the various departments has gradually been perfected, each being in charge of an experienced head, under the supervision of a chief clerk, and the business of the bank is carried on with increased efficiency. No change, other than alterations, has been made in the bank premises since the last report, but time has demonstrated that the Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT 1ST0. 10 KANSAS CITY. 519 present quarters are inadequate in space and arrangement. It has been found necessary to secure separate headquarters, fully equipped with vaults, for the fiscal agent's department The present lease expires in approximately two years, and while no definite action has been taken, informal consideration is being given to the erection of a proper banking house. The regular examination of this bank, by the examining staff of the Federal Reserve Board, was made during February. OMAHA BRANCH. The following directors were selected for the Omaha branch: Luther Drake, Omaha; P. L. Hall, Lincoln; J. C. McNish, Omaha; It. O. Marnell, Nebraska City; and O. T. Eastman, Omaha. The last-mentioned director was named as manager, and E. D. McAllister was elected cashier. The branch was opened September 4, 1917, in the old quarters of the First National Bank, these rooms being the only ones with suitable vault accommodations available. All member banks in Nebraska began to do business with this branch on that date. On September 30 the member banks of Wyoming were also assigned to the Omaha branch. The branch has been most useful to the section it serves. Conditions resulting from the winter wheat failure and damage to the corn in many sections of the State, combined with the demand for cash in connection with the second Liberty loan, caused a rapid and steadily increasing use of the discount facilities of the branch from the date of opening. Commencing with the discount of about a million dollars, a total of twelve and a quarter million was reached during the third week in November. While the banks of the larger cities were very active borrowers, discount offerings were received from a steadily increasing number of so-called country banks, and before the end of the year some 114 had availed themselves of the discount privileges. The opening of the Omaha branch doubtless has had much to do with the increasing popularity of the Federal Reserve "system among Nebraska bankers who are often in Omaha and are frequent visitors at this branch bank. The officers of the branch have been of considerable service in assisting in the sale of Liberty bonds, in Red Cross work, and the promotion of war-savings certificates, all of which activities have largely centered in the bank. As a result the bankers have become more familiar with the general operations of the bank. The executive or discount committee at first met only once a week, but the volume of business increased to such an extent that it was soon found necessary to have such meetings semiweekly and at times even more frequently. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

520 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. The volume of business through clearing operations has been steadily increasing. In the concentration of gold and gold certificates the branch has, so far, received a total of $2,000,000. Federal Reserve notes have been, to a large extent, put out in exchange for this amount, in addition to which the usual fall demand for currency has been promptly supplied, making a total of nearly $6,500,000 of notes issued since the opening of the branch. Considerable work has been done in the solicitation of membership from eligible State banks. A few applications have been received and it is quite evident that many more will be forthcoming during the next few months. There is every evidence that there will be a more or less steady demand for money from the territory of this branch, which will probably last until the late spring of 1918. DENVER BRANCH. It is anticipated that the Denver branch will be in full operation soon after the first of the year. Quarters have been obtained and the following directors have been selected: Alva Adams, Charles A. Burkhart, John Evans, A. C. Foster, and C. C. Parks. Charles A. Burkhardt, of Denver, has been elected manager. This branch will be operated along the lines which are a modification of branches already established and to conform with the ideas of the Federal Reserve Board, based upon experience. The distance of the Denver territory from Kansas City will bring about much greater efficiency in the service to member banks in that locality. CLEARING OPERATIONS. The past year has witnessed a growth and development of the clearing operations of this bank, the general clearing plan put into effect July 15, 1916, having been to some extent modified by amendment to the federal Reserve Act, suggestions of the Federal Reserve Board, and action of the management of this bank. Among these is an exemption from service charge upon a maximum of 500 items per month received from any one bank, and the directors of this bank have voted to reduce the charge, after January 1, 1918, on items in excess of 500 from 1% cents to 1 cent per item. Provision has been made to supply banks remitting at par, with return postage, and this consideration has produced an increase in the number of nonmember banks on the par list. The clearing facilities have been extended to nonmember banks which may desire to qualify as clearing members under the amended Federal Reserve Act. While this privilege has invited inquiries and correspondence, Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 10 KANSAS CITY. 521 the banks have been slow to avail themselves of clearing membership, although the plan has here and there been tested by a nonmember bank. Terms for the interchange of items have been so amended that direct sendings between members, for credit on the books of the Federal Reserve Bank, must be mutually agreeable to the banks concerned and be adjusted by their own arrangement. Provisions as to accepting currency shipments in payment of cash letters have been made more liberal and extended to both member banks and to nonmember banks on the par list. Facilities have been provided for the collection of maturing notes and bills, and this class of business has been invited. The local country clearing house continues to recognize the par list of the Federal Reserve Bank and extends the benefit thereof through its rules and regulations; and the existence and increasing use of the clearing facilities provided by the Federal Reserve Bank has had its effect on the check collection business of the district, so that it is believed the benefits are more and more percolating to the banks at large and their customers. Less is heard of criticism arising by reason of the elimination of profit accruing to banks through deduction for exchange in remitting for their items; and that the basis of this charge has been removed by the clearing plan of the Federal Reserve Banks appears to have become more generally recognized. The management of this bank has given general publicity to the provisions for Federal reserve exchange and transfer drafts, and believes that the interest manifested from time to time, and the conferences and correspondence in connection therewith, will gradually develop a wider use of this attractive facility. Thus far only a limited number of banks in this district have provided themselves with proper blanks and adopted the plan, and experience has developed that few bankers have been fully awake to the fact that the means is afforded them to create exchange, available at any Federal Reserve Bank, without cost and without transfer of balances. Succeeding months have exhibited increasing use of the transit department, and the average number of items handled daily is 50 per cent greater than in 1916, whereas the average daily amount aggregates three times the daily experience. These approximate calculations do not take into consideration the clearing business now handled by the Omaha branch of the Federal Reserve Bank of Kansas City. On the whole, the development of the transit business during the past year has been quite satisfactory, even though the majority of items handled are yet received from other Federal Reserve Banks and their members. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

522 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. Since the general provision for handling maturing bills and notes the items received here for collection and credit of proceeds when paid have steadily increased. Member banks in the same district have more nearly adapted themselves to the deferred time schedules, having a clearer understanding thereof, and application of the regulations with respect thereto has been attended with less difficulty than in 1916. Items from member banks in Nebraska and Wyoming have been handled by the Omaha branch within the past few months. The attitude of the Federal Reserve Bank has stabilized the local exchange market. The application of what are deemed proper principles, governing the purchase and sale of exchange, and transfer of funds has been gradual, and with further modifications of the market rates it is believed that an increasingly valuable service will be rendered. Within recent weeks some of the member banks have offered the Federal Reserve Bank for sale miscellaneous bank-draft exchange, which has been purchased in moderate quantity subject to a discount of 3-65/100 per cent per annum or 10 cents per thousand per day, based on the time schedule. This facility has materially aided some of the larger banks in maintaining reserve balances of collected funds during a period when the " float" necessarily handled by them was unusual in volume. Weekly settlements of balances as between Federal Reserve Banks, through the gold settlement fund in the custody of the Federal Reserve Board, have been highly satisfactory. Experience with this method has confirmed the conclusion that the plan has had a wholesome effect, even though not generally recognized or appreciated, upon the finances and upon the ebb and flow of funds between the several Federal reserve districts. SUM MART. The transition period covered by the past year has resulted in changed conditions affecting all walks of life and every aspect of business, but has passed in this district without disrupting the commercial and financial fabric or seriously disturbing the equanimity of the individual. It is generally conceded that the existence of the Federal Reserve Bank and the influence it has been able to exert in the readjustment of the business and individual outlook have brought about a wholesome effect and a wide appreciation of the Federal Reserve system. At the end of the year we find that the absence of peace has not deprived the district of prosperity, and the morale of the people and the business interests is highly developed. In general, the banks have an unusual volume of deposits and a healthy demand. Commercial and idustrial concerns are experiencing a decided activity. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT ISTO. 10—KANSAS CITY. 523 Agriculturists and stock raisers find a ready market for increased products at fair prices. The volume of business and the avenues of service have developed in marked degree in the Federal Reserve Bank, and its operations as fiscal agent of the United States have touched, by widening circles, every town and hamlet of the district. The results of the year's work as detailed by this report, when summed up, are indicative of considerable progress, and the Federal Reserve Bank is in much stronger position in every way than at the close of 1916. SCHEDULE A.—Income—Profit and loss account. Dec. 31,1917. Dec. 30,1916. Dec. 31,1915. EARNINGS. Bills discounted for member banks $438,831.43 $84,571.71 $64,257. 59 Bills bought, acceptance 171,112.15 29,601.03 7,831.51 Trade acceptances 391.10 United States bonds 256,792.18 186,411.19 20,630.85 Municipal warrants 5,136.63 14,366.41 9,575.48 Profits on United States securities sold 14,407.50 Transfers bought and sold 45,569. 84 Sundry profits 1,111.99 181.91 673. 76 Deficient reserve penalties (including interest). 37,395.78 Appreciation profit, United States bonds 34,463.96 Exchange 962.96 Total earnings. 955,950.00 364,966.67 103,360.29 EXPENSES. Federal Reserve Board assessments.. 13,118.24 10,574.64 5,928.48 Federal Advisory Council 370.00 305.85 357.10 Governors' conferences 665.23 1,244.74 924.13 Federal Reserve agents' conferences.. 423.08 717.20 Salaries: Bank officers 37,781.97 25,972.81 28,820.82 Clerical staff 39,684.21 32,231.06 34,915. 95 Special officers and watchman... 805.00 2,591.83 All others 1,570.05 1,599.42 Directors' fees 3,975.00 3,705.00 3,480.00 Per diem allowance 3,660.00 2,385.00 4,316.00 Traveling expenses 4,192.65 3,628.04 4,662. 51 Officers' traveling expenses 1,203.09 633.31 514. 72 Legal fees 775.00 600.00 1,501.20 Rent 8,849.96 7,949.96 9,538.85 Telephone 810.40 495.29 607.18 Telegraph 565.11 351. 55 572.17 4,971.74 6,457.19 10,347.01 Postage and insurance on gold concentration 9,283.80 Expressage 1,233.64 824.85 103. 24 Fidelittyy boon d ppremiums I 1,626.28 1,226.52 1,354.28 L—ig ht•, 'h-ea-t•, a-*n d power 1,184.56 979. 50 1,241.00 Printing and stationery 5,658.42 3,136.34 9,171. 34 Repairs and alterations 286. 74 213. 36 86.63 All other expenses not specified herein 7,216.69 4,108.18 4,227.68 Operating expenses. 148,682.78 109,850.69 125,979.32 EXTRAOEDINARY EXPENSES. Commissions paid 861.03 Cost of Federal Reserve notes issued 48,679.35 20,436.16 Cost of Federal Reserve bank notes (including taxes). 20,885.26 5,790. 54 Amortization organization Federal Reserve notes 5,523.16 Amortization organization expenses 887.35 26,484.44 Depreciation furniture and equipment 19,130. 59 3,900. 00 Total extraordinary expenses. •9,582. 55 62,134. 30 861.03 Total all chargeable expenses. 238,265.33 171,984.99 126,840. 35 343G50—18 34 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

524 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. SCHEDULE A.—Income—Profit and loss account—Continued. Dec. 31,1917. Dec. 30,1916. Dec. 31,1915. EXTRAORDINARY EXPENSES—continued. Net earnings $717,684.67 $192,981.68 $23,480.06 Profit and loss account, 1916 91,381.23 Total earnings for distribution 809,065.90 192,981.68 Less dividends paid 364,502.73 66,706. 96 Less organization expenses 34,768. 71 Less transit department disbursements, net deficiency 8,196. 09 Less premiums on United States bonds 75,462. 42 Less cost of unissued Federal Reserve notes 42,507. 74 Less depreciation of furniture and fixtures 19,222. 63 Less other deferred charges 5,766. 89 • Total deductions.: 515,658. 50 Net earnings to profit and loss account 293,407.40 91,506.02 SCHEDULE AA.—Earnings and expenses for calendar year 1917, also profit and loss on Dec. SI, 1911. Earnings for 1917, as shown on Form 95 $955, 950. 00 Expense of operation of bank proper $148, 682. 78 Cost of Federal Reserve currency issued (including expressage, insurance, etc.) 48, 679. 35 Miscellaneous charges account note issues 20, 885. 26 Depreciation on furniture and equipment 19, 130. 59 Transit department disbursements in excess of net service charges received 8,196.09 Total 245, 574. 07 Net earnings for year 710, 375. 93 Profit and loss, Jan. 1, 1917 91, 381. 23 Total 801, 757. 16 Less dividends paid : Jan. 25, 1917, for period Jan. 1, 1915, to Dec. 31, 1915__ $92, 188. 26 June 30, 1917, for period Jan._l, 1916, to June 30, 1916__ 89, 116. 93 Dec. 31, 1917, for period July 1, 1916, to June 30, 1917— 183, 197. 54 Premium on United States bonds 75, 462. 42 Cost of unissued Federal Reserve currency 42,507.74 Furniture and equipment 19, 222. 63 Other deferred charges 5, 766. 89 Organization expense 887. 35 Total deductions - 508, 349. 76 Profit and loss Jan. 1, 1918 293,407.40 SCHEDULE B.—Comparative detailed statement at close of business Dec. 31,1917, Dec. 30, 1916, and Dec. 31, 1915. Dec. 31,1917. Dec. 30, 1916. Dec. 31, 1915. RESOURCES. Bills discounted—members $12,773,682.45 $479,067.72 $428,872. 29 Bills bought in open market 1,337,928.75 3,945,180.94 3,580,463.35 Member banks' collateral notes 17,277,467.89 35,820.74 Rediscounts for other Federal Reserve Banks... 5,003,293.86 Municipal warrants 163,813. 65 288,015.84 United States bonds to secure circulation 8,000,000.00 6,000,000.00 United States bonds on hand 849,090.00 2,492,850.00 2,151,650.00 Premium and discount on United States bonds. 85,887.20 Interest accrued on United States bonds 60,504.90 53,978.18 8,"862.*i8 United States certificates of indebtedness United States gold notes "i^'ooo.'oo' 963,000.00 Expense—organization 52,984.44 Expenses paid in advance "*2," 062*70" 9,879.48 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 10 KANSAS CITY. 525 SCHEDULE B.—Comparative detailed statement at close of business Dec. 31, 1917, Dec. 30, 1916, and Dec. 31, 1915—Continued. Dec. 31, 1917. Dec. 30, 1916. Dec. 31, 1915. RESOURCES—continued. Cost of unissued Federal Reserve notes $27,614.85 $11,252.52 Furniture and equipment 15,982.54 31,828. 85 Furniture and fixtures—recoverable $13,750.00 25,978.29 15,000.00 Cost of unissued Federal Reserve bank notes 983.82 Expense Liberty loan 86,449. 96 Suspense account 13,071.00 Due from other Federal Reserve Banks 2,731,547.83 11,952,040.60 1,849,365.44 Due from member banks—overdrafts 17,688.57 11,783.74 Due from banks and bankers 1,029,956.21 Exchanges for clearing house. 72,871.41 10,899. 57 5," 656." 66 C D h e e fe c r k r s e d a n d d e b o i t t h s e ( r t r c a a n sh si t it a e c m c s ount) 17,7 1 8 6 6 0 , , 6 8 9 0 2 9 . . 4 7 6 9 4,60 6 2 , , 4 5 1 0 5 1 . . 9 6 5 5 363.85 Miscellaneous transfers bought Due from United States Treasurer, 5 per cent fund (ac- 6,883,190.00 count Federal Reserve bank notes) 300,000.00 National bank notes and Federal Reserve notes of other 400,000.00 banks 107,645.00 348,318.00 Federal Reserve bank notes on hand . 216,300.00 6,000,000.00 Federal Reserve notes on hand ""2,'650,'7i6.'66 517,120.00 """564," 850.'66 Nickels and cents 350.63 26. 75 2.07 Gold settlement fund, credit balances 37,263,377. 50 21,235,500.00 2,464,000.00 Gold with Federal Reserve Agent 42,025,170.00 Due from United States Treasurer, gold redemption fund (Federal Reserve notes) 507,045.00 150,095.00 107,000.00 Gold bullion and coin 118,742. 50 371,195.00 3,933,700.00 Gold held with foreign agencies 2,625,000.00 Gold certificates 1,591,780.00 5,793,590.00 4,535,310.00 Silver certificates 45,810.00 30,131.00 43,694.00 Legal-tender notes 11,000.00 113,845.00 70,375.00 Silver coin 843. 00 1,287.00 5,500.00 Total resources. 162,290,478.93 66,532,157.93 20,518,071.05 LIABILITIES. Capital paid in 3,396,750.00 3,073,950.00 3,037,800.00 Unearned interest and discount 119,799.05 17,748. 50 54,665.89 Government deposits 7,860,957.17 275, 778. 80 Due to other Federal Reserve Banks 10,336,961.54 492,750. 72 Due to member banks 72,976,491.13 44,191,246.07 14,930,086.68 Due to clearing members—deposit account 25,319.87 Expense checks 764. 61 Cashier's checks outstanding 971,533.33 1,373.07 2,767.76 Deferred credits, transit account 10,622, 800. 98 Federal Reserve Bank notes 8,000,000.00 6,000,000.00 Net liability Federal Reserve notes 2,540,000.00 2,666," 666." 66 Federal Reserve notes issued 58,023,420.00 Reserved for taxes 2," 829.'32' Profit and loss undistributed earnings (less transit expense) 293,407.40 91,506.02 Total. 162,290,478.93 66,532,157.93 20,518,071.05 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

SCHEDULE C.—Discount operations for the year 1917. to REDISCOUNTS FOR MEMBER BANKS, DISTRIBUTED BY STATES, AND MATURITIES AS OF DATE OF DISCOUNT. Number Number Number State. b o e f r m ba e n m k - s a o c f c o b m a m n o k - s o a f c t t i r o a n n s s . - 15 d l a e y ss s . and da O y v s e , r i n 1 c 5 l u to s i 3 v 0 e. da O y v s e , r i n 3 c 0 l u to si v 6 e 0 , da O y v s e , r i n 6 c 0 l u to si 9 v 0 e. Over 90 days. Total. ha B n a d l a D nc e e c . o 3 n 1. Dec. 31. dated. Colorado 122 39 $3,410,Oil. 61 $427,783.13 $642,581.62 $1,158,545.75 $1,341,302.07 $6,980,224.18 $1,720,281.58 Kansas 233 83 6,550,352.14 986,573.88 708,183.26 626,969.76 665,231.44 9,537,310.48 l,096,-840.31 Missouri 55 31 132,881,639.63 869,208.26 1,032,583.14 543,743.75 76,302.47 135,403,477.25 10,232', 048.94 Nebraska 192 44 51,983,464.85 1,832,793.39 2,668,354.98 2,162,676.09 1,472,899.64 60,120,188.95 12,611,143.14 New Mexico 9 6 19,958.87 36,484.73 118,025.75 213,477.99 387,947.34 75,015.04 o Oklahoma 311 159 15,063,224.23 1,437,462.10 3,625,595.38 3,126,876.26 1,697,983.69 24,951,141.66 4,088,016.20 Wyoming 36 2 12,000.00 3,541.80 21,500.00 136,105.60 137,331.22 310,478.62 227,805.1.3 H Total 364 209,900,692.46 5,577,321.43 8,735,283.11 7,872,942.96 5,604,528.52 237,690,768.48 30,051,150.34 VOLUME BY MONTHS. NATURE OF PAPER DISCOUNTED. MISCELLANEOUS. January $266,295.19 Trade acceptances $2,646,322.25 8,892 notes rediscounted, average amount. $3,623.00 February 158,577.33 Commodity paper 196,666.67 863 collateral loans made, average amount. 238,010.00 March 337,529.10 Agricultural, secured by live stock 10,280,112.99 Maximum amount held Nov. 7,1917 30,272,1)60.52 April 344,394.85 Agricultural, no collateral 1,832,658.42 Minimum amount held Feb. 7, 1917 3,157,910. 97 W May 4,236,847.53 Industrial and commercial 17,012,774.96 June 11,841,537.34 Secured by United States securities .. 248,511.33 Offerings rejected: July 16,137,000.25 Member banks' collateral loans: In part: 214 offerings, 679 notes 1,972,026.75 w August 19,480,867. 86 Secured by United States securities... 64,193,979.00 In whole: 33 offerings, 197 notes 725,365.14 S O e c p to te b m er b er 2 4 8 4, , 4 2 2 5 5 1 , , 9 7 2 4 7 1 . . 6 0 7 3 Otherwise secured 141,279,742.86 Total rejected 2,697,391.5 GwO November 69,999,049.23 Total 237,690,768.48 w December 42,211,001.10 w Total 237,690,768.48 w o w Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 10 KANSAS CITY. 527 Changes in discount rates tin ring calendar year 1917. Rate in effect *— Jan. 1, May 7, May 28, Dec. 3, Jan. 1, 1917. 1917. 1917. 1917. 191*. Discounts maturing within 15 days, including member banks' P. ct. P. ct. P. ct. P. ct. j P. ct. collateral notes Paper, including member banks' collateral notes, secured by United States certificates of indebtedness or Liberty loan bonds maturing within 15 days 3* 3i Paper maturing within 16 to 60 days Paper maturing within 61 to 90 days d Paper secured by United States certificates of indebtedness or Liberty loan bonds maturing from 16 to 90 days Agricultural and live-stock paper maturing after 90 days 4 Trade acceptances maturing from 1 to 60 day, ". Trade acceptances maturing from 61 to 90 days 4 Commodity paper maturing within 90 days. I 0) 4 i Rates <or commodity paper merged with those for commercial paper of corresponding maturities on Nov. 5. SCHEDULE D.—Open-market transactions for the near 1017. BILLS DISCOUNTED—BOUGHT (BANKERS' ACCEPTANCES). 1,845 items purchased in above period, total $26, 825, 413.10 At following discount rates: 3 per cent $2,105, 671. 41 3} per cent 5,472,186.12 3-A? per cent 315,493.52 3* per cent 264,842.75 3J per cent 13,465,965.38 3f per cent 135, 326. 78 3T3S per cent 639,233.33 4 per cent 71,720.14 Si per cent 4,278,223.67 Total 26, 825, 413.10 3ik per cent 76,750.00 By maturities, at date of purchase: Up to 30 days 1,366,522.79 30 to 60 days 7,131,508.84 60 to 90 days 18,327,381.47 26, 825, 413. 10 Classification: Domestic 1, 221, 923. 92 Export or import 25, 603, 489.18 26, 825, 413.10 SCHEDULE E.—Open-market transactions for the year 1917. WARRANTS. 7 purchases made, total (maturity value) $431,138.89 At following discount rates: 2| per cent $50,528.68 3} per cent $25,203.12 2| per cent 50,561.21 3f per cent 50, 806. 50 3 per cent 101,666.10 Total 431,138. 89 3| per cent 152,373.28 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

528 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. By maturities, at date of purchase: Up to 30 days None. 30 to 60 days None. 60 to 90 days $25, 203.12 90 days to 6 months 405, 935. 77 431,138. 89 Classification: Municipal' warrants. 431,138. 89 SCHEDULE F.—Open-market transactions for the year 1917—United States bonds. PURCHASES. Par value. 2 per cent consols, 1930 $1,147, 500 2 per cent Panamas, 1936 22, 240 Si per cent Liberty bonds, 1947 17. 500 4 per cent, 1925 • None. Total1 1, 187, 240 SALES. 3| per cent Liberty bonds, 1947 $10, 000 CONVERSIONS. Delivered to United States Treasury : None. Received from United States Treasury : Conversion bonds, series 1916-1946 $821, 900 One-year Treasury notes 821, 000 Total 1, 642, 900 UNITED STATES SECURITIES ON HAND DECEMBER 31. 2 per cent consols of 1930 $7,155, 850. 00 2 per cent Panamas, 1936 22, 240. 00 2 per cent Panamas, 1938 None. 3 per cent conversion bonds, 1946 16,600.00 3 per cent United States one-year Treasury notes 1, 784, 000. 00 4 per cent bonds, 1925 825, 000. 00 United States Liberty bonds, first issue, 1947 7, 500. 00 3 per cent conversion bonds, 1947 821,900.00 Total— 10,633,090.00 SCHEDULE G.—Discount and investment operations for the year 1917.—Average amount of each class of earning assets held, total earnings, and average annual rates thereon. Average holdings. Earnings. A™^e Bills discounted, members $10,389,034.00 $427,313.93 4.11 Bills bought in open market . .. 5,346,357.00 171,090.72 3.20 Warrants 178,525.00 5,137.00 2.88 United States securities... 11,079,176.00 256,793.23 2.32 Rediscounts for other Federal Reserve Banks 246,537.00 11,514.70 4.67 Total 27,239,629.00 871,849.58 3.20 1 Purchased at par. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 10 KANSAS CITT. 529 SCHEDULE H.—Reserve position. [Monthly averages.] Percent- Percent- Percent- Percent- age ex- Percent- Percent- age ex- Month. age car- age re- cess over Month. age car- age re- cess over ried. quired. require- ried. quired. requirements. ments. 1917. 1917. January 74.8 35 39.8 August 73.6 35 38.6 February 74.2 35 39.2 September 73.8 35 38.8 March 71.9 35 36.9 October 71.9 35 34.9 April .... 67.4 35 32.4 November ! 78.8 35 43.8 May.. 62.6 35 27.6 December 64.0 35 29.0 58.7 35 23.7 July 71.5 35 36.5 Yearly averages 70.6 35 35.6 SCHEDULE I.—Membership—additions and withdrawals mid effect on the total capital stock. ADDITIONS. Capital subscription Capital and State. o N f u b m an b k e s r . R Fe es d e e r r v a e l s m ur e p m lu b s e o r f Bank of banks. Kansas City. Colorado 1 $60,000 $1,000,000 Kansas 10 40,000 654,275 Missouri 2 222,000 3, 700, 000 Nebraska 2 1,500 25, 000 New Mexico. 3,000 50, 000 Oklahoma. 24,400 403, 500 Wyoming ! 1,700 27, 500 Total 24 352, 600 5, 860,275 WITHDRAWALS. Capital and State. Number Capital surplus of of banks. surrendered. member banks. Colorado 1 $18,000 $300,000 Missouri 1 18,000 300,000 Nebraska 3 6,000 98, 000 Oklahoma. 4 12, 800 212,125 Total. 9 54, 800 910,125 SCHEDULE J.—Member-bank deposits. [Net daily averages for the year 1917.] MONTH. Amount. January $45,178, 328. 00 July 16 to 31, inclu- February 46,150, 457. 00 sive $65, 995, 085. 00 March , 47, 242, 995. 00 August 66, 283, 424. 00 April 47, 704, 519. 00 September 67,180, 603. 00 May 47, 003, 388. 00 October 67, 509, 670. 00 June • 51, 735, 978. 00 November 71, 245, 774. 00 July 1 to 15, inclusive- 56, 245,149. 00 December 71, 410, 698. 85 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

530 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. SCHEDULE J.— Member-bank deposits—Continued. DEFICIENT RESERVES. [Daily averages for the year 1917.] Number Daily average Amount of Period. of banks. deficiency. penalties. January . 117 $448,995.00 $2,512.89 February - 71 428,760.00 2,167.85 March 72 229,038.00 1,283.10 April 53 158,543.00 864.06 May 41 668,870.00 3, 741.18 June ... 36 108,548.00 607.68 July 1 to 15, inclusive 38 108,227.00 296.57 July 16 to 31, inclusive.. 152 1,329,823.00 3,845.59 August. 114 869, 899.00 4,873.32 September 133 882,207.00 4,779.10 October.. 75 1,344,323.00 7,559.71 November 175 1,306, 745.00 7,085.43 December (estimated) . 150 1,200,000.00 6,000.00 SCHEDULE K.—Government Account from Jan. 1, 1917, to Dec. 31, 1917. [Including balance to credit of United States Treasurer, Dec. 30, 1916.] Balance to credit of United States Treasurer, Dec. 30, 1916 $275, 778. 80 Total amount of transfers from other Federal reserve banks 3, 300, 000. 00 Receipts from sale of Liberty bonds 185,979,029.41 Receipts from sale of Treasury certificates 69,411,000.00 Total amount of other net credits to United States Treasurer 62, 034, 458. 28 Total 321, 000, 266. 49 Total amount of warrants paid 84, 605, 220. 00 Total amount of certificates of indebtedness paid 71, 639, 000. 00 Total amount transferred by order of United States Treasurer. 146, 000, 000. 00 Balances to credit of United States Treasurer Dec. 31, 1917 18, 756, 046. 49 Total 321, 000, 266. 49 SCHEDULE L.—Federal-reserve agent's statement of Federal-reserve notes on hand, outstanding, received from Comptroller of the Currency, canceled, and coverage of total issue as of Dec. 31, 1917. RESOURCES. Federal-reserve notes on hand $8,800,000.00 Federal-reserve notes outstanding 57,883,420.00 Rediscounts to secure Federal-reserve notes 17, 827, 320. 41 Gold to retire Federal-reserve notes on hand None. Credit balance in gold-redemption fund $2,165.170. 00 Credit balance with Federal Reserve Board 39,860,000.00 42, 025,170. 00 Federal-reserve notes sent to Comptroller of Currency for cancellation and destruction 12,056, 580. 00 Total 138, 592, 490. 41 LIABILITIES. Federal-reserve notes from Comptroller of Currency—gross amount 78, 740, 000. 00 Collateral received from Federal reserve bank: Eligible paper 17, 827, 320. 41 Gold 42, 025, 170. 00 Digitized for FRASETRo tal 138, 592, 490. 41 http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 10 KANSAS CITY. 531 SCHEDULE M.—Federal Reserve notes, statement of Federal Reserve agent, from organization to Dee. SI, If)11. Number of pieces. Aggregate Hun- | amount. Fives. Tens. Twenties. Fifties. dreds. j Received from comptroller 5,108,000 2,216,000 1,252,000 64,000 28,000 $78,740,000 Received from Federal Reserve Bank 472,800 180,700 215,700 100,000 13,485,000 Received from Treasurer of United States (fit notes) 300 3,000 Received by comptroller from Treasurer of United States for destruction and credit of Federal Reserve agent's account (unfit notes) 1,541,328 316,769 1,0 51 12,056,580 Total. 7,122,128 2,713,769 1,523,852J 165,082 28,051 104,284,580 Issued to Federal Reserve Bank... 5,196,800 2,209,000 1,347,700 132,200 17,900 83,428,000 Returned to Comptroller of the Currency for destruction, including notes returned by United States Treasurer for credit of Federal Reserve agent's account 1,541,328 316,769 56,152| 1,082 51 12,056,580 Fit notes on hand 384,000 188,000 120,000 31,800 10,100 8,800,000 Total. 7,122,128 2,713,769 1,523,852J 165,082 28,051 104,284,580 SCHEDULE N.—Federal Reserve notes received and returned. [Amounts of Federal Reserve notes of the several denominations received from other Federal Reserve Banks for redemption or credit by the Federal Reserve Bank of Kansas City during the period since Jan. 1, 1917.] FnTes. Tens. Twenties. Exchanged with Federal Reserve Bank of— Received Returned Received Returned Received Returned Irom. to. . from. to. from. to. _... _ ..... Boston $34,470 S3,215 $35,850 $45,380 $400 JSJew York 398,500 42,400 288,000 $438,,370000 211,000 27,700 Philadelphia 32,000 2,750 33,000 5,550 52,500 3,700 Cleveland 24,590 4,550 19,050 8,100 18,900 9,100 Richmond... 8,750 4,450 11,990 6,690 12,000 5,900 Atlanta 86,250 25,600 64,500 25,450 54,400 16,100 Chicago 1,299,500 21,750 802,000 18,400 454,000 16,800 St. Louis 1,102,500 89,250 687,000 88,100 472,000 32,200 Minneapolis 109,160 54,050 65,410 53,150 36.380 24,500 Dallas 238,250 97,700 260,670 144,650 239,900 65,900 San Francisco 83,185 21,100 95,930 12,200 125,220 16,700 Total 3,417,155 366,815 2,363,400 414,290 1,721,680 219,000 Fifties. Hundreds. Total. Exchanged with Federal Reserve Bank of— Received Returned Received Returned Received Returned from. to. from. to. from. to. Boston $7,500 $800 $3,400 $700 $126,600 $8, 815 New York 49,600 3,450 29,500 5,900 976,600 127,750 Philadelphia.. 8,600 100 2,900 129,000 12,100 Cleveland 1,500 2,550 200 700 64,210 25,000 Richmond 1,400 1,350 100 600 34,240 18,990 Atlanta 6,400 700 1,000 1,100 212,550 68,950 Chicago 65,400 29,300 31,600 59,300 2,652,500 145,550 St. Louis 21,400 1,500 15,100 100 2,298,000 211,150 Minneapolis... 3,050 800 1,000 900 215,000 133,400 Dallas 14,200 1,400 1,800 1,300 754,820 310,950 San Francisco. 9,8(J0 3,500 5,500 2,600 319,635 56,100 Total.... 188,850 45,450 92,100 73,200 ! 7,783,185 1,118,755 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

532 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. SCHEDULE O.—Federal Reserve notes—Federal Reserve agent. Issued to bank, 1917 $50,620,000.00 Received by comptroller for cancellation and destruction 9, 735, 240. 00 Federal Reserve notes on hand, new, unissued 8, 800, 000. 00 Cost of unissued notes for the year 42, 507. 74 Cost of notes issued for the year 48, 679. 35 The cost of issued notes was made on the following basis: DENOMINATIONS. Cost per 1,000. Fives $1. 89 Tens 1. 08 Twenties . 60 Fifties . 36 Hundreds . 24 Federal Reserve notes of the Federal Reserve Bank of Kansas City received from other districts amounted to $7,783,185. Shipment cost averaged approximately 22 cents per 1,000, and is not included in the above schedule. SCHEDULE P.—Official and clerical staff. Number of officers 7 Number of employees in various departments 59 MONTHLY PAY ROLL, EMPLOYEES. Monthly Department. salaries. Federal Reserve agent's office and credit bureau $365.00 General clerical force, including discount, auditing, and all other departments except transit 2,709.99 Transit department (recoverable through service charges) 2,053.33 Total 5,128.32 SCHEDULE Q.—Recapitulation, city and country clearings, December, 1911}, to Dec. SI, 1917, inclusive. NUMBER OF ITEMS. Period. City. Country. Total. 1914 (December).. .. $5,860 $69,773 $75,633 1915 134,219 1,849,767 1,983,986 1916 (to July 14, inclusive) 78,229 1,214,570 1,292,799 1916 (July 15 to Dec. 30, inclusive) 303,644 1,259,216 1,562,860 1917. 706,951 3,221,608 3,928,559 Total. 1,228,903 8,614,934 8,843,837 CLEARINGS. 1914 (December).. $17,559,936.75 $21,082,772.04 $38,642,708.79 1915 297,183,974.98 413,007,012.52 710,190,987.50 1916 (to July 14, inclusive) 149,992,445.19 224,807,003.08 374,799,448.27 1916 (July 15 to Dec. 30 inclusive). 317,971,832.66 527,182,424.44 845,154,257.10 1917 1,387,192,764. 73 969,652,395.23 2,356,845,159.96 Total 2,169,900,954.31 2,155,731,607.31 4,325,632,561.62 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 10 KANSAS CITY, 533 MEMBER BANKS. City. Country. Total. Month. Items. Amount. Items. Amount. Items. Amount. January 54,322 $80,455,547.00 216,774 $47,977,451.75 271,096 $128,432,998.75 February 46,152 63,773,712.30 178,438 33,701,594.22 224,590 97,475,306.52 March 54,923 82,106,157.86 210,783 41,204,795.15 265,706 123,310,953.01 49,857 88,014,590.31 201,935 38,443,860.06 251,792 126,458,450.37 May 48,549 94,403,728.81 199,270 40,043,585.00 247,819 134,447,313.81 June. 48,028 99,300,864.26 195,552 38,002,945.13 243,580 137,303,809.39 July 47,582 105,387,730.85 187,157 53,482,490.61 234,739 158,870, 221.46 August 49,418 102,486,157.92 193,125 43,655,739.77 242,543 146,141,897.69 September 50,247 97,499,673.23 190,831 47,767,065.88 241,078 145,266,739.11 October 57,733 152,458,206.05 259,291 80,921,434.34 217,024 233,379,640.39 November 56,793 196,015,396.14 281,286 134,121,556.35 338,079 330,136,952.49 December 55,202 194,155,047.20 271,810 127,693,704.22 327,012 321,848,751.42 ITEMS ON OTHER DISTRICTS. January... 2,521 $67,776,850.46 14,440 $3,283,262.42 16,961 $71,060,112. 88 February. 2,020 50,800,669.30 12,687 '2,702,882.62 14,707 53,503,551.92 March.... 2,379 65,651,145.96 13,017 2,599,355.63 15,396 68,250,501.59 April 2,592 78,767,762.65 12,045 2,546,745.96 14,637 81,314,508.61 May 2,937 89,264,796.52 12,212 3,301,598.56 15,149 92,566,395.08 June 3,847 90,925,523.57 12,417 2,896,822.84 16,264 93,822,346.41 July 2,975 83,661,797.41 11,866 2,720,887.37 14,841 86,382, ,78 August... 3,146 86,391,323.14 12,843 3,633,927.70 15,989 90,025,250.84 September 2,411 73,713,657.28 10,279 3,441,541.57 12,690 77,155,198.85 October... 4,195 110,441,930.73 12,505 4,724,687.37 16,700 115,166,618.10 November. 3,089 118,327,570.16 12,967 7,810,227.88 16,056 126,137,798.04 December. 2,972 114,283,602.54 13,698 8,523,028.40 16,670 122,806,630.94 STATE BANKS. Month. Items. Amount. Month. Items. Amount. January.. 47,034 $3,984,063.63 August 51,075 $4,849,958.44 February 41,294 2,479,496.48 September. 42,406 4,189,823. 06 March 50,681 4,578,590.95 October 52,536 5,441,215.45 April.... 46,885 4,112,216.90 November. 52,541 6,378,597.76 May 46,782 4,230,054.35 December.. 55,009 5,937,048.47 June 48,812 4,525,705.11 July 47,484 6,254,995.84 Total 582,539 56,961,766.41 DAILY AVERAGE. City. Transit. Month. Items. Amount. Items. Amount. January 2,089 $3,094,444.00 10,798 $4,726,045.00 February 2,006 2,337,987.48 10,193 3,899!332. 28 March 2,034 3,040,961.40 10,254 4,223;479.91 April 1,994 3,520,583. 61 10,548 4,954,823.42 May 1,867 3,630,904.98 10,046 5,263,078. 28 June 1,847 3,819,264.01 10,024 5,070,203. 52 July 1,903 4,215,309.00 9,979 5,844,807.00 August 1,830 3,795,763.62 9,636 5,130,775. 89 September 2,093 4,062,486.38 10,247 5,379,670.32 October 2,138 5,646,600.22 12,167 7,464,046.95 November 2,271 7,840,615.84 13,995 10,665,518. 08 December 2,431 7,739,188.68 13,884 10,162,702. 93 Yearly average. 2,042 4,395,342. 43 10,980 6,065,373.64 COMBINED DAILY AVERAGE KANSAS CITY-OMAHA BRANCH. 1917. September $4,326,750.21 12,416 $6,254,819.36 October 6,522,058.45 15,318 8,900,041.98 November 9,032,972.68 17,330 12,511,366.68 December 8,806,387.08 17,464 11,778,659.33 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 11—DALLAS. W. F. RAMSEY, Chairman and Federal Reserve Agent. FINANCIAL. RESULTS OF OPERATION, EARNINGS, EXPENSES, DIVIDENDS, ETC. In submitting the annual report of the operations of the Federal Reserve Bank of Dallas for 1917, attention is called to the headway made by this institution in the matter of earnings. The exhibit of earnings is the more gratifying in reviewing the unusual developments of the year just closed. The work in every department of the bank has increased in such volume that additional employees were essential; salary adjustments have necessarily been made, in order to obtain and retain an efficient force, and our expense account further enlarged by the purchase of additional equipment, stationery and supplies, etc. In the year just closed we have further extended the period to which the bank has paid dividends to June 30, 1917, the actual period covered by this dividend being November 1, 1916, to June 30, 1917, and at the rate of 6 per cent. The amount paid was $107,908.18. The dividend was disbursed December 31, 1917. Upon its declaration there remained in the profit-and-loss account $205,353.08 after charging off $32,324.77 depreciation on furniture and equipment, and $7,500 as depreciation on bank premises. While the bank continues to be behind in its dividend payment for the period from July 1 to December 31, 1917, the profit-and-loss account carries sufficient to cover this period, which it is not deemed wise to pay out at this time. Some idea of the expansion of operations of this bank and the growth of its business w7ill be had from the attached exhibits and charts. The comparative balance sheets for December 31, 1916, and 1917, is shown as Exhibit 1. Statement showing earnings and expenses of the bank for the year 1917, and since organization, is attached as Exhibit 2. A chart showing earnings and expenses of the bank is attached as Exhibit 3. It should also be borne in mind that the cost of this additional equipment, stationery and supplies, and in fact everything essential to the proper conduct of the bank's affairs, has increased by 25 to 100 per cent during the year. 535 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

536 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. GENERAL BUSINESS AND BANKING CONDITIONS IN THE DISTRICT. Industrial and commercial activities in the district have been well maintained throughout the year. The business outlook is good, notwithstanding unfavorable crop returns from sections where drought was serious. Quite in contrast to one year ago, it can not be said that agricultural conditions throughout the year were favorable ; production has not been normal and the results in many portions disappointing. Some of the best cotton-growing sections of the district—counties that a year ago produced thousands of bales— this year raised practically nothing. A drought, probably the worst in the history of Texas, in any event the most serious in recent years, has prevailed through central, south, southwest, and west Texas for the greater part of the year and the damage wrought can not be estimated in dollars. Not only was the cotton crop in those counties a complete failure, but the yield of corn and forage crops was also small, and in fact, the farm products raised in those sections were not sufficient for home consumption, with practically no surplus for marketing. The production of wheat in Texas was approximately 15,000,000 bushels; oats, 40,000,000 bushels; and corn, 85,000,000 bushels. These yields were below the average productions. However, the excellent prices at which these commodities were sold, ranging from 25 to 100 per cent higher than last year, more than offset, in value, the decrease in yield. The cattle and live-stock industry generally, one of large importance in this district, except in those sections where range conditions were bad from lack of rain, has enjoyed a prosperous year. Prices for all classes of live stock and sheep have reached record figures and stockmen have shared liberally in the prosperity caused by high prices as the result of war conditions. The oil fields have worked to capacity throughout the year; new territory has been developed, fields extended and the production increased; the prices for the output were the highest in the history of the district and the only restriction of activities has been the scarcity of water, the high price of casing and labor, and, in fact, of all materials entering into the production. The car situation has been more or less serious with lumber mills throughout the year and has curtailed operations to some extent; a slowing down in orders has been the result. The millions of feet of lumber purchased by the Government for cantonment and ship construction have been a stimulus to the industry and caused unprecedented activity. The copper and zinc mines of Arizona and New Mexico have worked to capacity throughout the year and production has been Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTKICT NO. 11 DALLAS. 537 about normal. Demand for copper, already quite active, was of course stimulated by war conditions, and with prices, as for practically every other commodity, at record figures, the industry seems destined for a long run of prosperity. The coal mines of Oklahoma and west and southwest Texas have been busy all the year and the output has been larger than in 1916. Manufacturing in all lines has been active. After war was declared a large number of Government contracts were placed in this district, which had the effect of increasing operations and providing work during an otherwise dull period. The wholesale and jobbing trade, by reason of the advance in the price of goods, while doubtless showing a reduction in the number of orders received, has been large in volume and the results for the year are satisfactory. The large mail-order houses have enjoyed an excellent business. There has unquestionably been a tendency to restrict the purchase of luxuries and some lines have suffered as the result of the practice of economy and the limited buying of nonessentials. The more staple classes of merchandise have been in good demand, and retail distribution is fully up to last year's figures. Banks of the district entered the year in a generally strong condition. After the good crop of 1916 collections were satisfactory and a general liquidation of accounts took place. As a consequence, banks were carrying the heaviest deposits in their history and the financial situation was all that could reasonably be expected. This condition existed as the borrowing season was approached. The seasonal demands were normal and were met without disturbances. Rates have been comparatively easy during the year and fluctuations in rates not material. The response of the banking. institutions, member and nonmember, to the Government's plans of war financing has been indeed liberal. Clearings at the principal cities of the district for the 11 months ending November 30, 1917, show an increase of 34 per cent over the same period of 1916. Post-office receipts at the larger cities have been unusually large and show a heavy increase for the year over 1916, the cantonment cities, especially Waco, showing increases of from 25 to 75 per cent. The number of commercial failures in this district and amount of liabilities involved have each month shown a substantial decrease as compared .with 1916, and indicates that business is on a generally sound basis. To summarize, it may be stated that business has been very satisfactory in 1917, and the new year is approached with optimism. Adjustments to war conditions have gradually been made, and while conservatism will continue to be the general policy in many lines, and new undertakings will be entered upon with caution and deliber- Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

538 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. ation, it is believed the future will justify the prediction that the year 1918 will be as prosperous as the past year. ACTIVITIES OF THE FEDERAL RESERVE BANK DURING THE YEAR, DISCOUNT OPERATIONS. The volume of discount operations of the bank shows a large increase over 1916, the aggregate for the year being $92,129,552.99 as compared with $22,055,589.56 last year. There were accommodated during the year by rediscounts 258 member banks, of which 29 were banks which had not previously rediscounted with us. The largest note discounted was for $958,000, the smallest $10.50. Exhibit 4 shows the volume of our discount operations by months throughout the year. Exhibit 5 shows the changes in our discount rates during the year. The changes have been but few, as conditions, while unusual, have not made revision necessary. Exhibit 6 shows the classification, by maturities, of the paper discounted during the year. The facilities offered by this bank for handling the so-called commodity paper have never been extensively availed of by our member banks. This is unquestionably due to the fact that during the past two years all commodities raised on the farm, and for which the preferential rate on this class of paper was established to assist in gradual marketing, have sold at prices far beyond those previously received. As the result there was no occasion for the storage of the products and little necessity of assistance of banks to finance producers pending their marketing. While the use of trade acceptances in substitution for open-book accounts is being gradually adopted by business men in this district, there yet remains much educational work to impress upon manufacturers and jobbing houses the desirability of this form of paper and its adoption by commercial interests generally. Our officials have endeavored in every possible way to arouse interest in this form of paper and have the trade acceptance substituted for the open-book account, and their efforts have met with some success. This is evidenced by the increased numbers of inquiries for information on trade acceptance. Exhibit 7 shows the amount of trade acceptances discounted during the year and maturities of the same. BILL OF LADING COLLECTIONS. The service rendered member banks through the handling of bill of lading collections has been a means of relieving them of a burden upon their facilities during the crop-moving period. It has proven a source of earnings as well, since interest as 4 per cent is charged on the items while outstanding. The total of such items handled Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 11 DALLAS. 539 during the year was $5,339,916.91, classified, by commodities, is shown in Exhibit 8. ACCEPTANCE BUSINESS. The volume of acceptances which this bank has handled throughout the year, both by purchase in the open market and through other Federal Reserve Banks, has shown a large increase over the amount bought in 1916. The acceptance system is growing in this district, and we predict a still further and more rapid development of this method of credits as the banks become familiar with the advantages of the bills. The purchase of acceptances has proven advantageous in increasing our earning assets, as well a& providing a cover for the issue of Federal Reserve notes. Exhibit 9 shows the amount of acceptances purchased, rates at which purchased, and classification by maturities. The rates on acceptances purchased have averaged 3.32 per cent. Most of the acceptances purchased covered goods imported or exported, and only a small percentage of the transactions were domestic. There is a growing tendency, however, to use domestic acceptances, and we believe the field will ultimately be developed, and domestic acceptances be offered in larger volume. The purchase of acceptances has been principally from member banks. UNITED STATES BOND OPERATIONS. Exhibit 10 shows the operations of the bank in United States bonds during the year. Of the amount of bonds held $2,732,400 cover Federal Reserve Bank note circulation. During the year the bank purchased $1,337,750 from member banks and $50,000 in the open market. The table referred to shows the amount of bonds converted into Treasury notes and sales of such securities. Holdings of United States bonds on December 31, 1917, are shown in Exhibit 11. MUNICIPAL. WARRANTS. Our investment in municipal warrants has not been large. Exhibit 12 show<s the volume of such transactions, rates at which purchased, maturities, and classification of these securities by character of bodies issuing. The amendment to the Federal Reserve act, passed during the latter part of 1916, by which member banks can borrow on their own notes, for a period not exceeding 15 days, such notes to be secured by eligible paper, or United States securities, has filled a long-felt want, and the facilities offered by such short-time accommodation have grown in popularity with our members, as evidenced by Exhibit 13, showing the amount of this class of paper handled and the 34365°—18 35 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

540 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. number of banks for which we have discounted. The service extended by these promissory notes enable our member banks to care for any unusual demands of a temporary nature, and is especially helpful in building up debit reserves. CHANGES IX THE RESERVE POSITION OF THE BANK DURING THE YEAR. The attached chart (Exhibit 14) shows the reserve po,sition of the bank throughout the year. It will be noted that the bank has at all times been well above the amount required. THE FEDERAL RESERVE BANK AND MEMBER BANKS. CHANGES IN MEMBERSHIP DUE TO TRANSFERS FROM AND TO OTHER DISTRICTS. The membership of this bank has not been affected during the year by transfers from or to other districts, and, so far as we are informed, no alterations are contemplated in the boundary lines of the eleventh district, except the agitation of a slight change in northern New Mexico, which has not seemed to meet with the approval of any considerable number of the banks which would be affected by the change. While the area covered by the eleventh district is rather extensive, we believe the service rendered our members, even in the remotest sections, is satisfactory, and transfers to other districts are therefore not necessary or desirable. MOVEMENT OF MEMBERSHIP WITHIN THE DISTRICT. On January 1, 1917, there were 621 member banks in this district. The total capital subscribed by these banks was $5,400,100, of which $2,695,300 had been paid in. During the year 9 banks liquidated, retiring from business entirely or taking out State charters. This reduced our paid-in capital stock $17,200. There were added during the year by new national charters and State banks' memberships 20 banks, increasing our paid-in capital $48,350. Additional stock allotments, by reason of increase in the capital and surplus of member banks, have been made, aggregating $143,600, with $71,800 paid in. Stock surrendered on account of reduction in the capital and surplus of members, aggregated $9,900 and reduced our paid-in capital $4,950. After taking into consideration the changes in membership enumerated above, we have in the district on December 31, 1917, 632 member banks, with total subscribed capital of $5,589,800 and total paid-in capital of $2,794,900, an increase in number over December 31, 1916, of 11 and increase in amount of capital paid in of $9,600. The membership, by States, is as follows: Arizona, 7; Louisiana, 12; New Mexico, 32; Oklahoma, 30; Texas, 551; total, 632. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 11 DALLAS. 541 RELATION TO NATIONAL BANKS, STATE BANKS, AND TRUST COMPANIES. The officials of .this bank appreciate that the success of the institution depends in a large measure upon the attitude of our member banks, and it is a real pleasure to mention the hearty cooperation of the institutions generally of the district. Our relations with them are most cordial and we continue to enjoy their good will. As in other sections, there developed some opposition over installation of the check-clearing plan, but this unfavorable sentiment has largely though not entirely disappeared. Experience has demonstrated that much good can be accomplished by personal contact with the bankers of the district, and following the practice adopted since the bank opened, one or more of the official staff have attended the various bankers' meetings, district and State, held during the year. RELATION TO STATE BANKS AND TRUST COMPANIES STATE BANK MEMBERSHIPS. The preceding paragraph referring to relations with member banks includes, of course, those State banks which are already members. The eligible State banks have not only been circularized, but special letters written, detailing at length the prerequisites to membership advantages and benefits to be derived, etc. As a rule, the State banks are friendly to the system, and we think the majority of them are as patriotic as our own members. There are probably several reasons for the apparent apathy of State banks. Many State bankers have the impression, to a large extent erroneous, that by joining they will be subject to dual supervision. Another deterrent factor is the question of exchange, and some objections to membership are based on that score. These and many other reasons are advanced for State banks remaining out of the system. The fact that financial conditions have been comparatively easy since the Federal Eeserve System was established, for which its existence is directly responsible, and the ability of State banks to derive indirect benefit from the system through their national-bank correspondents is, we believe, one of the principal reasons why so little progress has been made in State-bank membership. The number of State banks in the district eligible for membership, based on figures compiled from a bank directory of July, 1917, is as follows: Arizona, 6; Louisiana, 33; New Mexico, 28; Oklahoma, 5; Texas, 370; total, 442. ACCOMMODATION OF MEMBER BANKS THROUGH DISCOUNTS AND THE PURCHASE OF ACCEPTANCES. In a paragraph preceding mention is made of the accommodation to member banks by discount operations, ancl, an exhibit attached Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

542 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. shows the number of banks served and the volume of paper handled. These functions are being rapidly developed, and the growth in such operations in 1917 has really been phenomenal. As the banks use our rediscount facilities and become familiar with our requirements they appreciate that the same are not onerous, and if they " keep their house in order," they are assured every service consistent with sound banking principles. There may have existed in the past some criticism of so-called "red tape" in this regard. If such fear did previously prevail, we believe it has been almost, if not entirely, eliminated. Our executive committee has always inclined to be liberal in policy, although requiring that offerings come within our regulations. The acceptance field is yet to be developed in this district, and the volume of this class of paper handled by banks is not large, though we have purchased some acceptances from member banks in limited amounts, as shown in Exhibit 9 attached. Acceptance credits furnish an excellent means of handling cotton accounts, and their liquidity, early maturity, and favorable rates should make such investments quite attractive, and we anticipate a rapid growth in the acceptance market. MEMBER-BANK DEPOSITS EXCESS DEPOSITS OVERDRAFTS. Exhibit 15 shows the deposits of member banks, by months, throughout the year, excess carried, and amount of overdrafts. Penalties for deficient reserves amounted during the year to $12,968.16. We require a weekly report from member banks, showing their net deposits, from which the reserve balances are calculated, and if deficiencies occur penalties are assessed. The member banks, we think, are disposed to keep their reserve balances at the required figure, and there has been considerable improvement shown during the year. Notwithstanding the final transfer of reserves after the passage of the amendments to the act, June 21,1917, deficiencies were not large, nor were the amount of penalties increased perceptibly. Unfamiliarity with time schedules, the operation of the clearing system, and availability of items for credit contribute to the impairment of required reserves. Experience shows that often the same banks are offenders week after week and, as in other requirements, banks that comply with regulations are seldom, if ever, on the deficient list. Amounts of overdrafts were comparatively small, as shown by Exhibit 15, and have resulted in impaired reserves, through a misunderstanding of mail schedules, deferred availability of items handled through the district clearing house, and delay in receipt of remittances and transfers. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 11 DALLAS. 543 PERIODIC REPORTS REGARDING CONDITION OF MEMBER BANKS EXAMINA- TIONS OF MEMBER BANKS. The reports of condition of member banks on the periodic examinations by the chief examiner's force, as well as the statements submitted on the Comptroller's calls, are carefully examined and analyzed by the Federal Eeserve agent and our credit information division. Memoranda of unusual or unfavorable items appearing thereon are made and form a permanent record in our credit files. If of a serious nature, remedial steps are immediately taken. It is gratifying io report that few such cases have arisen during the year, and as a result only three special examinations by the officers of this bank were necessary. Such investigations have, without exception, disclosed an entire willingness on the part of the member bank to correct irregularities, and conform strictly with the department's regulations and those of the Federal Reserve Bank. We endeavor, in such instances, to act in an advisory capacity, as well as to institute regulatory measures. BANK FAILURES WITHIN THE DISTRICT. There have been no bank failures in the eleventh district during the year. In one or two instances, where unfavorable reports about a bank's condition have been received, special attention was immediately given. OVERDUE PAPER. This bank has held no overdue paper during the year, provision having been made by member banks to take care of all paper as it matured. THE FEDERAL RESERVE BANK AND THE PUBLIC, OPEN MARKET OPERATIONS OF THE FEDERAL RESERVE BANK. There has been a large increase in our open-market activities during the year. The volume of paper purchased in this manner is shown in the following tables and attached exhibits. The favorable rates at which such investments are offered, and the liquidity of the same, make them attractive for the employment of our funds. A large portion of the earning assets of the bank throughout the year have consisted of open-market purchases. Most of these operations have been conducted for us by the Federal Reserve Bank of New York, as member banks in this district have as yet engaged in such business only in a very limited way. We anticipate a rapid development in this field and growth of such operations with this bank. It is a service for which the banks were established, and their resources can be employed to excellent advantage by such investments. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

544 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. EFFECT OF THE DISCOUNT RATE POLICY OF THE BANK UPON GENERAL MARKET RATES. Eates of discount are of course governed by financial conditions and the general principle of supply and demand. We have made but slight changes in our rates during the year. Even with conditions somewhat abnormal on account of the war, there has been no occasion for rates to be increased materially. Fluctuation in the rates of commercial banks in the district were not great, and we do not believe that variations either way throughout the year have exceeded 1 per cent. Unquestionably this is to a considerable extent due to our rates and facilities of rediscount. The effect or influence, therefore, of our rediscount policy on general market rates is to equalize the same and, while not necessarily reducing the rates of commercial banks, to exert the healthy condition of stability. The eleventh district is unlike the districts in the East, in that it is largely agricultural, and variations in rates are not subject to local conditions as in the larger financial centers. PUBLICITY WORK OF THE BANK. The average individual knows but little of the operations of the Federal Eeserve Bank, except that it is a " bank for bankers," and therefore has no transactions with the public. There is, however, a growing appreciation in the public mind of what the institutions mean to the financial world, and of the service rendered to member banks. While this bank has never actively undertaken any public relations work, and has no publicity department proper, it is our policy to keep the public well informed, through the local newspapers and Associated Press, of the bank's activities. THE FEDERAL RESERVE BANK AND THE GOVERNMENT, GOVERNMENT DEPOSITS. Prior to the inauguration of the Government's war financing our relations as fiscal agent had been confined principally to receiving deposits from local authorities, for credit in «the Treasurer's general account, and making transfers of funds. Exhibit 16 shows the amount of such deposits and transfers prior to the handling of Liberty loan funds. RELATION TO THE UNITED STATES TREASURY. This subject is partly covered in the paragraph preceding, touching fiscal operations. Other relations, of course, include transactions with the subtreasuries in the supply of various forms of money, particularly small bills and fractional coins, of which, since we have Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 11 DALLAS. 545 extended our service and developed additional functions pertaining to those of a subtreasury, it has been necessary to keep large amounts on hand. We endeavor to supply our member banks with all forms of currency and coin, and therefore our transactions and frequent relations with the Treasury are somewhat intimate. RELATION TO THE COMPTROLLER'S OFFICE. The office of the chief examiner for the district, who is really the comptroller's representative on the ground, is in the bank building. During the year the examiners have been called in conference by the chief examiner, and our officials had the opportunity to meet them and discuss matters of mutual interest. The Federal Reserve agent's department and the bank proper have frequent transactions with the comptroller in connection with Federal Reserve notes, their receipt, redemption, etc. THE FEDERAL RESERVE BANK AND NOTE ISSUES. GENERAL POLICY IN THE MATTER OF NOTE ISSUES. The bank has not altered its previous policy of issuing Federal Reserve notes to supply the currency needs of the district at cropmoving periods and other seasons and as the means of increasing our gold stock. The Federal Reserve note is rapidly being substituted for other forms of currency. The chart attached (Exhibit 17) shows the amount of notes outstanding during the year. There is also attached a chart (Exhibit 18) showing similar figures for 1916. A comparison proves interesting and shows that whereas the total outstanding on January 1, 1917, was $23,762,855, the amount on December 31, 1917, was $47,716,950, while the minimum during the year was $18,905,115, on July 30. Exhibits 19 and 20 show all transactions in notes during 1917 and since organization of the bank to December 31, 1917. SUBSTITUTION OF FEDERAL RESERVE NOTES FOR GOLD AS CIRCULATING MEDIUM. Since the passage of the amendments to the act, whereby only balances with the Federal Reserve Bank count as reserve, there is no occasion for member banks to hold gold in any considerable amounts. We have taken advantage of this opportunity to increase our stock of gold by exchange for Federal Reserve notes. Considerable gold has been thus acquired, and Federal Reserve notes substituted. Further steps will be taken in this direction, since the notes can be issued directly against gold, and gold held by the Federal Reserve agent as cover is counted as reserve. Not only have Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

546 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. member banks been willing to cooperate by shipping us their gold for Federal Reserve notes and other currency, but many nonmember banks have done so. COVER OF NOTES ISSUED. Exhibit 21 is a transcript of the daily statement of the Federal Reserve agent's department on December 31, 1917. It shows the cover of notes issued, both gold and commercial paper. DENOMINATIONS OF NOTES ISSUED. Exhibit 19 shows the denominations of notes issued during the year. Of the notes issued, fives, tens, and twenties are in greatest demand, especially tens and twenties, and it has been difficult to maintain a sufficient supply of these notes to meet requirements. There is small demand for fifties and hundreds, and if ordered it is generally to fill a special purpose of creating balances, or to meet a temporary requirement. AVERAGE LIFE OF NOTES ISSUED. It would, in our opinion, require careful study of this matter, and X>robably the working out of a test plan to determine with any degree of accuracy the average life of Federal Reserve notes. Any statement or estimate, therefore, is purely guesswork. The purpose for which issued, or rather the individual circumstances of issue, and location of bank to which furnished, and other factors enter into the problem. The smaller denominations, being issued in greater numbers, naturally become mutilated sooner than others. Assuming that the paper used in the preparation of the notes is of the same standard of quality as other forms of United States currency, it occurs to us that the amount of unfit notes returned for redemption and destruction, in proportion to the amount issued, is quite large. It is the practice in this district to begin issuing Federal Reserve notes for the crop movement about the middle of August. Shipments for this purpose continue through October, and often occur in November. About the first of the year member banks begin to return them, and our experience is that about 50 per cent of the notes returned are mutilated and have to be forwarded to Washington for destruction. Along with our own notes are large numbers of notes of other districts, and the latter are as a rule in better condition than our own. We have noted this fall a comparatively small number of twenties returned, and are unable to account for this fact unless it be that they are used for troops' pay rolls and find their way back more slowly than the other denominations. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 11 DALLAS. 547 INTERDISTRICT MOVEMENT OF NOTES. Amounts of Federal Eeserve notes of this bank received from other banks exceeded by over 60 per cent the amounts of notes of other banks returned by us. The ratio has been smaller this year than last on account of the shipment of notes of other banks to cantonment points in this district for soldiers' pay rolls. Such notes have come to us in original packages. Exhibit 22 shows the amounts of notes received from other Federal Reserve Banks and returned to such banks during the calendar year 1917. The total amount of our notes received from other banks was $5,765,280. The total amount of notes of other banks returned to them was $3,506,950. The cost per thousand dollars of our notes returned is approximately 22^ cents. This includes amounts returned direct to us or forwarded to the Treasury Department for redemption. The Federal Reserve Banks nearest Dallas, of course, receive the largest number of our notes, St. Louis, Kansas City, and Atlanta returning more than any other banks. From New York also we receive our notes in large amounts. REDEMPTION AND DESTRUCTION OF NOTES. Exhibit 20 shows the amount of notes forwarded to the comptroller for redemption and destruction during the year, as well as total amount redeemed and destroyed since the bank was established to December 31, 1917. COST OF FEDERAL RESERVE NOTES. Exhibit 23 attached shows the cost of Federal Reserve notes printed for the bank during 1917. The statement shows a large increase over 1916, as our transactions in notes during the year have been very heavy, necessitating large orders from the comptroller. Early in the year the Federal Reserve Board arranged to have a minimum supply of notes of this bank always available in Washington and at the Subtreasury of St. Louis. The supply agreed upon in the several denominations has been sufficient for our requirements. The cost of the notes has added materially to our expense account. FEDERAL RESERVE BANK NOTES. There has been no occasion to use Federal Reserve bank notes during the past year. On January 1 we held these circulating notes aggregating $2,000,000. During the year we increased the same to $2,732,400, and that amount is now held by us. The bank-note circulation will be used only in emergencies. It is impracticable to use these notes in view of the circulation tax. With the supply of Federal Reserve notes always ample for our currency requirements, there should be little necessity to issue the bank notes. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

548 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. FEDERAL RESERVE AGENTS AND NOTE ISSUES. In the issue of Federal Reserve notes the Federal Reserve agent endeavors to be of real service to the bank and, as the Government's representative, to comply with all requirements of the Federal Reserve act regarding note issues. The supply of notes has to be carefully watched and the various denominations maintained at all times. The Federal Reserve agent's department and the bank officials work in close cooperation in such transactions, and, as a result, render efficient service to our members, which WQ feel is an important function of Federal Reserve banks. The deposit of a supply of notes with the Assistant Treasurer at St. Louis, to be availed of in emergencies, has been very advantageous and enabled us to secure shipments quickly where, on account of unusual demands, we could not judge our needs in advance. AMENDMENT REGARDING NOTE RESERVE. Since the passage of this amendment to the act, on June 21, the bank's position has been materially strengthened, since gold with the agent counts as part of the bank's required reserve, and notes can be issued directly against gold. The issuing power of the banks is thus materially increased. INTERNAL MANAGEMENT OF THE BANK. FUNCTIONS AND WORK OF DIRECTORS, EXECUTIVE COMMITTEES, OFFICIAL AND CLERICAL STAFF, MEMBER OF ADVISORY COUNCIL. Our board of directors meets the first Tuesday of each months and, with the exception of August, w^hen some of our members were unavoidably absent from the State, the meetings have been held regularly, a total of 11 having been held in the year. At all of these meetings a quorum has been present, and at most of them a full attendance. The directors have discussed the affairs of the bank in the freest and fullest manner. The members are all men of large affairs, representing various lines of business, and the three classes of directors are typical of the commercial, industrial, and financial interests of the district. There has been no change in the personnel of our board in 1917. On December 19, 1916, class C director, H. O. Wooten, whose term expired December 31, 1916, was reappointed by the Federal Reserve Board for the three-year term beginning January 1, 1917. On January 3 class C director, W. B. Newsome, was designated deputy chairman of the board and deputy Federal Reserve agent for the year ending December 31, 1917. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT KO. 11 DALLAS. • 549 The terms of class A director, E. K. Smith, and class B director, J. J. Culbertson, expired December 31. In accordance with the provisions of section 4 of the Federal Reserve act an election of successors to these gentlemen was held, the polls opening November 20 and closing December 4. Director Smith was originally elected by banks in group 2, and Director Culbertson by group 3. The banks were regrouped, with the result, however, that no change was made in the grouping from last year. The present grouping is as follows: Group No. 1, banks with an aggregate capital and surplus of $120,000 or more; group No. 2, banks with an aggregate capital and surplus of $60,000 but less than $120,000; group No. 3, banks with an aggregate capital and surplus of less than $60,000. Of 221 banks in group 2 only 50 sent in certificates of election of district reserve elector. Mr. Smith was reelected, being the only nominee, and received 50 votes. Of 201 banks in group 3 only 25 sent in certificates of election of district reserve elector. Mr. Culbertson was reelected, being the only nominee, and received 25 votes. As in the past, our member banks took very little interest in the election, as indicated by the small number of banks certifying the election of a district reserve elector. In such an important matter, and one so vitally affecting the bank, it would seem that our members, if not desiring to make a nomination, would, at least, take enough interest to vote. It would be encouraging to the nominee to know that all of the member banks had a part in his election. The executive committee of the bank, as its name implies, directs the affairs of this institution, under the supervision and control of the board of directors, and exercises the powers conferred on it by the by-laws. The governor, as chairman of the executive committee, makes monthly reports to the board of directors, in which the work of the committee is fully reviewed. The committee meets daily to pass on discount offerings, to initiate open-market purchases, transactions in securities, if any are contemplated, and to discuss matters of importance which may have developed during the past 24 hours. The officers of the bank meet on Tuesday and Friday of each week, at 9 o'clock a. m., for a general discussion and review of operations. Any important correspondence received since the previous meetingis read. Official communications with the Federal Reserve Board are also, if deemed desirable, presented and matters of policy outlined. These meetings enable the officers to keep in the closest touch with developments from day to day. At the directors' meeting January 4 Mr. T. J. Eecord was reelected to represent the eleventh district on the Federal Advisory Council. Mr. Record has attended the regular sessions of the council, and frequently conferred with our directors and officials on subjects dis- Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

550 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. cussed b}^ the council and matters of general interest to the eleventh district. On December 31, 1917, there were employed by the bank, including the district clearing house, 90 clerks and 9 officers. OFFICE AND VAULT FACILITIES BANK PREMISES. The vault space proper of the bank is ample for present needs, and we believe sufficient for our requirements for some time to come. This is not true, however, of office facilities, and additional space is needed, some of the departments being badly crowded. At a recent meeting of our board the class B directors were appointed a committee to consider the feasibility of leasing additional quarters, or of adding new stories to the present building. Their report will soon be submitted. In the meantime some relief has been afforded by the leasing of space in a near-by building for the Liberty loan and depositary divisions. EXAMINATIONS BY FEDERAL RESERVE EXAMINER. The bank proper and the Federal Reserve agent's department were examined by the chief examiner and his staff for the Federal Reserve Board on February 13, 1917. This examination included every department of this institution, and was most thorough, as previous examinations have been. It is gratifying to state that on the schedule "Suggestions to officers," the chief examiner reported "none." Commenting on the conduct of the affairs of the institution the chief examiner reports, "The bank has a well-balanced and efficient organization." CLEARING OPERATIONS. Since the beginning of general clearing operations July 15, 1910. there has been a gradual and steady increase in the number and amount of items handled. While this increase is due to business development rather than to solicitation, still the member banks in this district are beginning to realize the advantages offered them in the Federal Reserve par collection system and are availing themselves of its facilities to an increasing extent. It has not been the policy of this bank to resort to solicitation in order to increase its par list. New clearing accounts are welcomed, however, and advantage is taken of every opportunity to explain to banks that contemplate sending us their miscellaneous items the advantages that are to be gained. It seems desirable for the smooth working of the system and for the insurance of its permanency that the development be gradual. Items received and handled for account of other Federal Reserve Banks are in number almost equal to the number received and han- Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 11 DALLAS. 551 died for account of our member banks. While the number of items received from member banks has greatly increased, it is not meant to convey the impression that the number of clearing accounts has increased in proportion. The majority of these items are received from the large central banks, the country banks still preferring to send their items to their city correspondent with whom they have had satisfactory relations extending over a long period of time. A large portion of such items forwarded, however, finally seek collection through the district clearing house, the city banks finding it much to their advantage to send us the items, thus obviating the necessity of having their funds scattered over a wide territory, and also saving the expense of extra accounting. The method of operation, with few exceptions, remains unchanged. On account of the delayed mail service the average collection time of items drawn on banks in this district has been increased, and as a consequence it has been necessary to withhold credit to other Federal Reserve Banks' accounts for an additional 24 hours, making proceeds of such items now available in four days after receipt. When conditions become normal it is possible that the former practice of crediting such items in three days will be resumed. EFFECT UPON RESERVES. The method of making charge to member banks' accounts covering items sent them, after sufficient time has elapsed for us to receive their credit advice, whether or not same has been received, has not materially affected the reserves of member banks. Although in a number of cases penalties were assessed for deficiencies, and occasional overdrafts, the aggregate reserves have been well maintained, which indicates that the majority of member banks have become thoroughly familiar with the effect of deferred time schedules on the available reserves. It has been the policy of this bank to improve impaired balances occasionally by mail delays, but not until a thorough investigation has been made of the mail schedule and not until it is found that the member bank has exercised due diligence in restoring such balance. Improvement is not made then unless our attention has been directed to the delay. This method has been productive of much good in that member banks are now checking the daily statement of account forwarded them immediately upon receipt. This has also enabled us to keep the time schedules current. SERVICE CHARGES. The service charge in this district applicable to all items on which deferred credit is given has permitted of the accumulation of sufficient funds to offset all expenses incidental to the operation of the Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

552 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. district clearing house, in which has been included a monthly depreciation charge of 2 per cent on equipment. The cost of equipment has not been included in this expense. IMMEDIATE CREDIT ENTRY. This bank has maintained its liberal policy toward its members in the manner of making settlement of debit balances received in the district clearing house. Immediate credit upon receipt has been given for drafts drawn on banks in all Federal Reserve cities, as well as points on wThich other Federal Reserve Banks allow us immediate credit. The means afforded by the operation of the reserve city clearing house has also been of much assistance to the country banks in making quick settlement of such balances. RESERVE CITY CLEARING HOUSE. The reserve city clearing house, operated for the convenience of former reserve city banks and at their expense, has fulfilled all expectations. Its operations are regarded now as a necessity. The member banks of the clearing house continue to send the actual checks and drafts which they receive on each other to the drawee banks for credit. Against these drawings they draw drafts in favor of the Federal Reserve Bank and forward it for their credit in reserve city clearing house. A clearing is effected and resultant balances advised by wire. Settlement of balances is made on the same day. Debit balances may be covered in any of the following ways: Debited to reserve account of debtor bank; remittance by mail to other Federal Reserve Banks for credit of Federal Reserve Bank of Dallas at the current rate of exchange; or by arrangement with any other bank to deposit funds with the Federal Reserve Bank for that purpose and remittance of currency by registered mail insured. Dis- 0 position of credit balances are subject to the instructions of the creditor banks. In the absence of advice the reserve city clearing house account is closed by making debit or credit entry to reserve account. Some of the large member banks not participating in the reserve city clearing house have made drafts, drawn on them by their country correspondents immediately available at the Federal Reserve Bank, by permitting us to charge their reserve account. Viewing the clearing operations of this district as a whole, the service rendered to member banks, as well as to other banks, would be difficult to overestimate. Opposition to the plan has greatly decreased, and expressions of cooperation are being continually received. Exhibit 24 shows the total operations of the district clearing house for the year December 15, 1916, to December 15, 1917. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 11 DALLAS. 553 SERVICE RENDERED TO THE BANKS BY THE GOLD-SETTLEMENT FUND. During the past year the bank and its members availed themselves to an increasing extent of the services of the gold-settlement fund. As shown in Exhibit 25, this bank paid out during the year in gold through the gold-settlement fund $637,849,800 and received payments of $647,424,000. This plan has obviated the necessity of shipping millions of dollars in settlement of balances between Federal reserve banks. It has proven especially valuable in making heavy transfers for the account of the Treasurer, occasioned by the Government's fiscal activities. The concentration by this plan of accumulated funds from proceeds of Liberty bond sales has enabled us to make these transfers at a small attendant expense and thus to avoid actual cash shipments to meet the Treasurer's demands. That this plan has to a marked degree stabilized the exchange market and tended to properly distribute credit throughout the country is obvious. It also affords an effective means of making deposits in gold with the Federal reserve agent as cover for the issuance of Federal reserve notes and transfers resulting therefrom. The necessity of this plan in promoting transactions between the Federal reserve banks becomes more and more apparent. In our opinion improvement could be made only by effecting settlements at more frequent intervals. Exhibit 25A shows, by months, the settlement and resultant balances, both debit and credit, made during the year. This does not include the many other transactions made through the fund. SHIPMENTS OF CURRENCY AND COIN. Exhibit 26 gives the amounts of currency and coin shipped, by months, to member banks during the year. The bank has rendered a distinct service to its members in this regard, but especially have our facilities been used during the cotton movement of the late summer and fall months. While previously the banks of the district called upon their reserve city correspondents and the Subtreasuries for their currency and coin needs, they now order through us, and we have met their demands by keeping ample stocks on hand, and have thus performed the functions of a Subtreasur}^ The total currency and coin shipments during the year were $55,717,633, a considerable increase over 1916, the total for that year being $45,527,252. The large shipments to member banks at cantonment sites, for construction and soldiers' pay rolls, account for part of the increase. HISTORY OF LIBERTY LOAN ORGANIZATION. On May 15, 1917, the first Liberty loan central advisory committee was called together. The committee was composed of about 80 of Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

554 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. the principal bankers and merchants of the eleventh Federal district, together with the Federal Reserve Bank officers. At the meeting an executive committee of 17 members was formed. It wTas not deemed necessary to have separate committees for the different phases of activity, the responsibility for the conduct of the campaign resting very largely upon Mr. J. W. Hoopes, as executive manager, the executive committee meeting when necessary. At a somewhat later date a chairman of the women's Liberty loan committee of the district was appointed. At the first meeting of the executive committee it was agreed unanimously that the county judge should be appointed chief local organizer. The judge was requested to call a meeting at the county seat of all the more responsible citizens in the county, and at this meeting subcommittees were appointed to handle the loan in those cities, towns, and communities remote from the county seat. The response of the county judges was reasonably good; in some cases, particularly good, although it should be noted that owing to the short time at our disposal, the newness of the whole proposition, and the geographic extent of the district, organization was not as near perfect as could have been desired. The banks were approached through letters, and the response was gratifying. In some cases where the county judge refused to act, banks took the whole burden of the loan upon their shoulders. The loan was subscribed very slowly at first, more than 50' per cent of it being subscribed during the last week. During the period of the second Liberty loan campaign the same committee as beipre was appointed to handle the matter. Arrangements for organization and publicity were started on September 19 in preparation for. the opening of the campaign on October 1. The earlier start, as compared with the first campaign, was of great advantage, and resulted in a 95 per cent county organization; that is to say, 95 per cent of our 295 counties were organized, with a chairman and a committee. The unorganized sections of our district comprised counties in which there are neither railroads nor towns of any size. The county judge was again designated as chief local organizer, and in most cases was found a very satisfactory organizer. The banks showed more enthusiasm during the second campaign, advertised the loan more extensively, and generally showed an awakening to the needs of the situation. The women's Liberty loan committee was particularly well organized, and a careful estimate shows that at least $13,000,000 in subscriptions were obtained as a direct result of the efforts o.f the women's committee, which was organized with Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 11 DALLAS, 555 a chairman in each county, working in conjunction with the county judge. Appreciative acknowledgment is hereby made to the many citizens who patriotically and unselfishly cooperated in the work of the local Liberty loan organization and who freely devoted their time to the task of placing the bonds in the hands of subscribers. Exhibit 27 gives detailed information regarding subscriptions to the first and second Liberty loans received by the bank, also regarding the distribution of certificates of indebtedness sold through the bank. Exhibit 28 gives expenditures and number of employees of the Liberty loan department, also amount of reimbursements received from the Treasury Department. CONCLUSION. The influence and effect which the operations of this bank have had not only in the financial world but in the channels of trade generally would be difficult to estimate. With the rapid growth in our resources and the general development of facilities not before undertaken, the sphere of the institution's usefulness is thus broadened and its opportunities for real service increased. For the past two years—in fact, since the bank was established—conditions in the eleventh district have been generally prosperous, and the proverbial i;rainy days" for bankers have not materialized. The bank has therefore not been thoroughly tested. There unquestionably exists in the minds of the initiated, however, an appreciation of the service Federal Reserve Banks can and do render, and the assurance that when stressful times come they can turn to this institution for assistance. The management of the Dallas bank will continue, as it lias in the past, to encourage our members to use our facilities and become familiar with our methods. The majority of the banks have already done so, and the task of education is less arduous. The bank's position is well established. The institution is dedicated to service. Its functions and activities have just begun. We approach the new year, therefore, with confidence, in the firm belief and assurance that past achievements and service will be even surpassed in the future. 34365°—18 36 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

556 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. EXHIBIT 1.—Comparative statement of the Federal Reserve Bank of Dallas. Dec. 31, 1917. Dec. 31, 1916. RESOURCES. Bills discounted and bought 880,546.54 $3,032.115.69 United States bonds to secure circulation 732,400.00 2,000,000.00 Other United States bonds and Treasury notes 193, 700.00 3,033,250.00 Investments, municipal warrants ' 150,458.74 127,318.87 Bill of lading drafts 682,058.19 072.50 Bank premises 136,736.31 144,246.31 Furniture and fixtures 11,000.00 37,164.32 Cash and due from banks (not reserve) 227,722.99 1,407,448.37 Federal Reserve bank notes on hand 732, 400.00 2,000,000.00 Credit balance in gold settlement fund 520,700.00 14,946,500.00 Gold with agent for retirement of outstanding Federal Reserve notes 036,675.00 22,862,855.00 Gold and lawful money 896,493.91 5""" 894. 50 Gold held with foreign agencies 837,500.00 Deferred debits 5,022,023.23 Deferred debits—checks and drafts in process of collection .,581,975.95 Federal Reserve Banks—transfers bought (net) 1,619,774.36 Total. 113,240,141.99 59,932,888.79 LIABILITIES. Capital stock 794,900.00 2,695,050.00 Net profits 217,906.06 33,864.51 Federal Reserve notes issued 716,950.00 24,162,855.00 Reserve deposits (net) 155,240.99 25, 742,902.95 Government deposits 609,284.55 1,493,691.05 Due to other Federal Reserve Banks (net) 515,970.49 1,292,435.51 Deferred credits—checks and drafts in process of collection 497, 489.90 2,511,089. 77 Federal Reserve Bank notes (secured by United States bonds). 732,400.00 2,000,000.00 Total. 113,240,141.c 59,932,888.79 EXHIBIT 2.—Comparative statement of earnings and expenses of bank for years 1917, 1916, and since organization. Since organi- 1917 1916 zation. EARNINGS. Bills discounted, members $198,571.22 $205,232.29 $646,039.47 Bills discounted, other Federal Reserve Banks 10,493.44 10,493.44 Acceptances bought in open market 138,512. 74 10,879.64 149,392.38 United States bonds and Treasury notes 159,431.61 64,576.25 224,642. 74 Municipal warrants 6, 832. 79 736. 80 7,858.49 Profits realized on United States securities '. 4,007.67 4,007.67 Transfers—net earnings 31,027.34 ""7,*365.'20" 42,552.19 Deficient reserve—Penalties 12, 968.16 12,968.16 Sundry profits 3,747. 42 18,144. 46 22,177.40 Total. 568,592.39 306,874.64 1,120,131.94 EXPENSES. Assessments account expense Federal Reserve Board. 11,438.78 9,664. 82 48,314.85 Federal Advisory Council expenses 150.00 752. 80 1,346.21 Governors' conferences 398. 42 1,300.80 1,699.22 Federal Reserve agents' conferences 207.64 613.55 821.19 Salaries: Bank officers 41,050.54 33,055.08 110,951.22 Clerical staff 39,940.27 28,361.56 103,417.23 Special officers and watchmen 2,761.68 1,771.02 4,961.70 All other 2,980.78 2,585.33 7,613.11 Directors' remuneration and expenses 3,521.89 4,259.10 13,705.80 Officers' and clerks' traveling expenses 1,138.77 1,234.33 4,953. 73 Legal fees 2,400.00 2,422.40 5,236.25 Rent 10,079.78 Taxes and fire insurance 927.20 3,439.18 Telephone 869. 47 871. 74 2,388.29 Telegraph 584.46 645.24 1,685.73 Postage 3,166. 32 3,088.43 10,126. 45 Expressage 8,424.31 10,783.23 30,690. 87 Insurance and premiums on fidelity bonds 1,517.92 476. 73 6,371.14 Light, heat, and power 1,468.24 1,318.65 2,965.29 Printing and stationery 6,327.37 496.97 16,236. 07 Repairs and alterations 2,472.86 209.30 3,173.09 All others not specified, including exchange 5,154.00 6,298. 69 18,828.57 Cost of Federal Reserve currency issued 30,910.82 12,346.43 50,640. 81 Total. 167,811.74 122,556.20 459,645.79 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTBICT NO. 11 DALLAS. 557 EXHIBIT 3.—Chart showing earnings and expenses of the Federal Reserve bank of Dallas for 1917. Jan. Feb. Mar. Apr. May June July Aug. Sept Oct. fvov. Dec. 105,000 100,000 / 95,000 90,000 / 85,000 80,000 j / 75,000 / 70,000 j / 65,000 60,000 / / 55,000 / / ! 50,000 ! 45,000 / 40,000 j / 35,00Q / 30,000 25,00Q y y' eo.ooo- -—„, / "—< \ y - 15,000 — 10,000, 5,000 Expenses Revenues m Net Revenue EXHIBIT 4.—Rediscounts. Volume of rediscounts for 1917: Rediscounts for member banks $52,052,599.99 Bankers' acceptances purchased 35,076,917.00 Rediscounts for other Federal reserve banks 5, 000, 036. 00 Total 92,129, 552. 99 Volume of rediscounts for 1916: Rediscounts for member banks 18, 512, 542, 85 Bankers' acceptances purchased 3,543,046.71 Total 22, 055, 589. 50 Total number of banks accommodated in 1917 258 Total number of new banks accommodated in 1917 29 Largest note rediscounted, $958,000; smallest, $10.50. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

558 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. REDISCOUNTS FOR 1917, BY MONTHS, AND DISTRIBUTION BY STATES. New Month. Texas. i Oklahoma. \ Mexico. Arizona. | Louisiana. January.. $621,024 !..... I $37,795 February. 693,452 i $"'4 ,6"~0~3 23,900 : March 791,175 | 239,690 ! 1,545,506 23,210 241,292 | $5(5.419 May 1,922,188 106,985 221,958 ! $21,958 June 3,310,387 | 1*6. 794 342,140 July 3,703,544 I 53', 996 404,894 20,471 August 3,904,851 j 106,800 212,966 7,250 September 4,670,209 | 35,066 483,979 25,767 October | 10^ 940^ 833 170,000 610,809 November ! 12,407,467 110,000 227,229 91,000 December | 2,759,341 15,000 435,022 107,137 228,493 Total. 47,269,977 742,454 | 3,481,674 163,556 394,939 Total of paper rediscounted as shown above, $52,052,600. EXHIBIT 5.—Discount rates for 1911 and dates on which effective. Class of paper. Time. Jan.l. Jan. 24. May 23. Dec. 5. Industrial and commercial Up to 15 days 4.0 3.5 3.5 4.0 Do 16 to 60 days 4.0 4.0 4.0 4.5 Do 61 to 90 days 4.0 4.5 4.5 4.5 Agricultural and live-stock Up to 15 days 4.0 3.5 3.5 4.0 Do 16 to 60 days 4.0 4.0 4.0 4.5 Do 61 to 90 days 4.0 4.5 4.5 4.5 Do 91 days to 6 month' 4.5 5.0 5.0 5.0 Trade acceptances Up to 60 days 3.5 3.5 3.5 3.5 Do 61 to 90 days 3.5 3.5 3.5 4.0 Commodity paper Up to 90 days 3.0 3.5 3.5 Member bank rediscounts, United States securi- Up to 15 days 3.5 3.5 ties. Do 16 to 90 davs 3.5 4.0 M c e u m r b it e ie r s b . ank collateral notes, United States se- Up to 15 days 3.5 3.5 Member bank collateral notes, other securities.. do 4.0 EXHIBIT G.—Classification by maturities of bills discounted and bought in 1917. Due within 15 days $34,486,685.99 Due 16 to 30 days 7, 325 335.16 Due 31 to 60 days 29, 947, 444.15 Due 61 to 90 days 15, 243, 514. 05 Due 91 days to 6 months 5,126,574.00 Total 92,129. 553. 35 EXHIBIT 7.—Classification of trade acceptances by maturities. Due within 15 days $6,967.00 Due 16 to 30 days 3,911.00 Due 31 to 60 days 85, 938. 00 Due 61 to 90 days 81,137. 00 Total 177, 953. 00 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 11 DALLAS. 559 EXHIBIT 8.—Bill of lading drafts. Based on grain and grain products $1, 339, 365. 41 Based on alfalfa 330, 495.14 Based on hay 131, 273. 91 Based on cotton and cotton products 3,259,159.74 Based on wool 192, 572. 38 Based on miscellaneous produce 70, 558. 20 Based on machinery, hardware, furniture, etc 16,492,13 Total 5,339,916.91 EXHIBIT 9.—Statement of bankers' acceptances—Rates and time. Purchased at 4 per cent $150, 000. 00 Purchased at 3| per cent 40, 000. 00 Purchased at 3f-per cent 1, 260, 352. 64 Purchased at 3i9e per cent 1, 281, 898. 53 Purchased at 3£ per cent .._ 6,178, 486. 82 Purchased at 3f per cent 10,331,446.57 Purchased at 3i5e per cent - 1,951,765.04 Purchased at 3i per cent 6,561,325.42 Purchased at 3T36 per cent 14,242.72 Purchased at 3£ per cent __ 3, 511, 201. 29 Purchased at 3IG per cent 429,238.25 Purchased at 3 per cent 2, 746. 030. 88 Purchased at 2| per cent 620,928. 10 Total 85, 076, 916. 26 TIME CLASSIFICATION. Due within 15 days $428,906.99 Due 16 to 30 days 5,700,650.16 Due 31 to 60 days 18,806,952.06 Due 61 to 90 days 10,140,407.05 Total 35, 076. 916. 26 Average rate of discount at which purchases were made, 3.32 per cent. EXHIBIT 10.—Operations in United States bonds and securities for the year 1917. Held on Dec. 31, 1916. Registered 2 per cent consol bonds of 1930 $2, 923, 350 Registered 2 per cent Panama bonds, series 1936 542, 500 Registered 2 per cent Panama bonds, series 1938 155, 000 Registered 3 per cent conversion bonds, series 1916-46 707, 400 Registered 3 per cent one-year Treasury notes 705, 000 Total 5,033,250 BONDS AND TBEASIJEY NOTES PURCHASES, SALES, AND CONVERSIONS. Registered 2 per cent consol bonds of 1930: Purchase from member banks, at par $478, 750 Converted 951, 200 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

560 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. Registered 2 per cent Panamas, series 1936: Purchased from member banks, at par $84, 000 Converted 500,000 United States 3 per cent conversions, 1916-46, sold at 102 200, 000 United States 3 per cent conversions, 1917-47, received by conversion of 2 per cent bonds 726, 200 United States 3 per cent one-year Treasury notes: Received by conversion of 2 per cent bonds 725,000 Replaced by new notes 1, 430, 000 Charged to Treasurer of United States 1,430,000 First series 3f per cent Liberty bonds: Purchased from Treasury Department 3, 800 Purchased from member banks 775, 000 Sold at par 301,700 Second series 4 per cent Liberty bonds: Purchased from Treasury Department 3,400 Purchased in open market ' 50,000 Sold at par 400 EXHIBIT 11.—Bonds and Treasury notes held on Dee. 31, 1911. Registered 2 per cent consols of 1930 .$2,450,900 Registered 2 per cent Panamas, series 1938 155, 000 Registered 2 per cent Panamas, series 1936 126, 500 Registered 3 per cent conversion bonds, series 1946 507,400 Registered 3 per cent conversion bonds, series 1947 726, 200 Registered 3 per cent one-year Treasury notes 1,430,000 First series 3| per cent Liberty bonds 477,100 Second series 4 per cent Liberty bonds 53, 000 Total 5, 926,100 EXHIBIT 12.—Purchases of municipal warrants. Municipality. Rate. Maturity at time of discount. M v a a t l u u r e i . ty Per cent. San Antonio, Tex. 4 After 90 days, but within six months.. $4G, 265.00 Do 4 do 104,193.74 Do 3 After 30 days, but within 60 days 52,291.67 Do 3* do \ 51,703.47 Do 3i do 52,062.50 New York City.... After 90 days, but within six months.. 50,806.50 Do "..... do..... 50,561.21 Do do 30,317.21 Do do 25,395= 55 Do..... do 253,955.48 Newark, N. J do 20,350.00 TotaJ ! 737,902.33 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT KO. 11 DALLAS. 561 EXHIBIT 13—Member banks9 collateral notes. Total of member banks' collateral notes $33, 374, 300. 00 Number of banks accommodated in this manner 87 Paper secured by United States bonds and certificates of indebtedness : Member banks' collateral notes $16,270,250.00 Member bank rediscounts 2, 019. 20 Rediscounts for other Federal Reserve Banks 5,000,036.00 Total 21, 272, 305. 20 EXHIBIT 14.—Reserve position. Jan. Feb. Mar. Apr. May June July Aug. Sept. Oct. Nov. Dec. — — — 105 100 9b H 90 85 __ — 50 \ — N V 75 s N 70 65 --, \ V —, 60 55 50 -Percenfage of Gold Reserve to Federal Reserve note circulation -Per centage of reserve against net deposit liabi/ffy Yearly averages : Gold reserve against Federal Reserve note liability—90.2. Gold reserve against net deposit liability—73.0. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

562 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. EXHIBIT 15.—Statement shaving the required reserve deposits of member banks by months, amount actually carried, excess, and amount of overdrafts during year 1917. Required Actual reserves. Excess. Overdrafts. reserves. January— $535,756,032.00 $652,010.040.64 $116,254,008.64 $1,202,972.32 February.. 458,327,600.00 543;170,450.14 84,842;850.14 45.709.91 March 502,679,028.00 623,494,182.22 120,815,154.22 117,711.04 April 463,679,842.00 558!738,029.48 95,058,187.48 94.649.92 May 495,698,072.00 6oo:902,055.42 105,203,983.42 117,964.35 June 440,829,125.00 580;425,581.49 139,596,456.49 351,602.97 July 551,402,462.00 715,550,757.09 164,148,295.09 891,370.34 August C65,708,910.00 767,902.583.65 102,193,673.65 62,558.66 September. 680,415,672.00 759;123,816.81 78,708,144.81 154,399.16 October 875,290,000.00 957,179,988.21 81,889,988.21 200,779.96 November. 903,299,725.00 1,058,948,144.19 155,648,419.19 435,188.22 December.. 882,415,000.00 1,133,257,371.70 250,842,371.70 340,861.96 Total 7,455,501,408.00 8,950,703,001.04 1,495,201,533.04 4,015,768.81 Total amount of penalties on deficient reserves charged during year 1917, $12,968.16. EXHIBIT 16.—Amount of deposits in the Treasurer's general account, and amount of transfers from the same by months, for the period prior to Mar. 31, 1017, the first date of deposit in the account of Liberty loan funds. Funds Payments received. made. January $417,645.42 $327,846.51 February. .. 413,226.60 1,073,015. 68 March 410,854.63 663,821.86 Total. 1,240,726.65 2,064,684.05 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

563 DISTEICT NO. 11 DALLAS. EXHIBIT 17. Mil. Mil. 49 Jan "Mar Apr Way 1 Jill Aug Oet Doc 49 | 43 48 / 47 47 / 46 46 45 45 ,/ 44 44 43 43 42 42 41 1 41 40 ( 40 39 ( 39 38 1 38 37 37 f 36 35 / 35 35 / 34 34 / 33 33 / 32 32 / 31 31 / 30 30 ( 29 29 f 28 28 1 27 27 J 26 26 / 25 25 / 24 24 23 \ I 23 / 22 22 21 \ / 21 20 / \ / 20 IS 19 19 Federal Reserve Notes Outstanding Year of 1917. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

564 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. EXHIBIT 18. Mil. Mil. 43 Jan FebMar Apr May JUn Jul Aug Oct NovDec 43 42 42 41 41 40 40 39 39 38 38 37 37 36 36 35 35 34 34 33 33 32 32 31 31 30 30 29 29 28 28 27 27 26 26 A 25 25 / 24 f 24 / \ 23 23 ZZ / 22 21 J 21 20 / 20 19 19 18 i 18 17 1 17 / 16 16 15 15 14 \ \ 14 V V i* 13 Federal Reserve Notes Outstanding Year of 1916. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 11 DALLAS. 565 EXHIBIT 19.—Number of Federal Reserve notes, by denominations, and aggregate amounts received, issued to the bank, and returned to the comptroller during the year 1917. Fives. Tens. T t w ie e s n . - Fifties. d H re u d n s - . A a g m g o re u g n a t t . e Received from comptroller 1,188,000 1,188,000 668,000 8,000 16,000 $33,180,000 Received from Federal Reserve Bank 135,000 269,500 110,500 7,500 24,100 8,365,000 Received by comptroller from Treasurer of United States for destruction and credit of Federal Reserve agent's account (unfit notes) 551,197 320,080 87,773 J 837 132 7,767,305 Total 1,874,197 1,777,580 866,273J 16,337 40,232 49,312,305 Issued to Federal Reserve Bank 1,351,050 1,476,550 750,500 21,013 25,050 40,086,400 Returned to Comptroller of the Currency for destruction, including notes returned by United States Treasurer for credit of Federal Reserve agent's account 551,197 320,080 87,773^ 837 132 7,767,305 EXHIBIT 20.—Number of Federal Reserve notes, by denominations, and aggregate amounts received, issued to the bank, and returned to the comptroller since organization and on hand at close of business on Dec. SI, 1911. Fives. Tens. Twenties. Fifties. d H re u d n s - . A a g m gr o e u g n a t te Received from comptroller 3,028,000 2,328,000 1,164,000 56,000 40,000 $68,500,000 Received from Federal Reserve Bank .. - 459,250 686,350 259,450 29,400 31,750 18,993,750 Received from Treasurer of United States (fit notes) 350 140 180 13 7,400 Received by comi/troller from Treasurer of United States for destruction and credit of Federal Rese~Tt cent's account (unfit note. • From oth.r Federal Reserve Banks . 109,483 69,926 23,440 269 32 1,732,125 Direct from reporting Federal Reserve Banks and from other sources 858,630 366,540$ 91,918| 1,652 154 9,894,925 Total 4,455,713 3,450,956^ 1,538,988^ 87,334 71,936 99,128,200 Issued to Federal Reserve Bank... 3,076,000 2,844,090 1,330,930 65,413 46,350 78,345,150 Returned to Comptroller of the Currency for destruction, including notes returned by United States Treasurer for credit of Federal Reserve agent's account 1,005,713 471,366$ 120,558| 1,921 186 12,268,050 Notes on hand at end of month 374,000 135,500 87,500 20,000 25,400 8,515,000 Total. 4,455,713 3,450,956J 1.538.988* 87,334 71,936 99,128,200 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

566 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. EXHIBIT 21.—Federal Reserve agent's note account Dee. 31, 1917. Description. f B o a rw la a n r c d e . Debit. Credit. Balance. RESOURCES. Federal Reserve notes on hand $8,515,000.00 $8,515,000.00 Federal Reserve notes outstanding 47,726,950.00 $10,000.00 47,716,950.00 Federal Reserve notes sent to Comptroller of Currency for destruction 12,258,050.00 810,000.00 12,268,050.00 Bills to secure Federal Reserve notes 23,131,747.18 379,200.25 630,400.! 22,880,546.54 Funds held against Federal Reserve notes: Gold coin and certificates on hand 14,080,000.00 14,080,000.00 Credit balance in gold redemption fund 2,4S2,675.00 2,482,675.00 Credit balance with Federal Reserve Board... " 71,000.00 8,474,000.00 Total.. .116,417,221.54 LIABILITIES. Federal Reserve notes received from Comptroller of Currency, gross amount 68,500,000.00 68,500,000.00 Collateral pledged against outstanding Federal Reserve notes: Paper 25,036,675.00 25,036,675.00 Gold 23,131,747.18 630,400.89 379,200.25 22,8S0,546.54 Total.. .116,417,221.54 EXHIBIT 22.—Amounts of Federal Reserve notes of the several denominations received from other Federal Reserve Banks for redemption or credit and returned to other Federal Reserve Banks for redemption or credit by the Federal Reserve Bank of Dallas during the period Jan. 1,1911, to Dec. 31,1917. Fives. Tens. Twenties. Federal Reserve Bank of— Received Returned Received Returned Received Returned from. to. from. to. from. to. Boston $12,270 $6,115 $82,100 $274,960 *-v.'. ,0 $1,120 New York 217,805 113,160 389,210 219,990 355', .,00 195,920 Philadelphia.. 11,500 49,410 33,500 247,890 47,000 14,900 Cleveland 6,420 25,630 15,930 14,270 12,7C0 252,540 Richmond 6,000 58,080 13,430 15,910 13,420 14,940 Atlanta 233,500 103,000 319,500 224,830 215,000 166,900 Chicago 225,000 29,955 379,000 39,680 290,000 51,700 St. Louis 506,500 64,670 649,000 156,040 464,000 146,360 Minneapolis 13,170 \4,970 23,240 22,770 21,540 28,0C0 Kansas City 97,700 242,250 152,950 256,670 57,600 239,900 Dallas San Francisco.. 38,805 16,260 78,710 22,140 100,640 49,4G0 Total.. 1,368,670 723,500 2,136,570 1,495,150 1,617,640 1,159,800 Fifties. Hundreds. Total. Federal Reserve Bank of— Received Returned Received Returned Received Returned to. from. to. from. to. from. Boston $5,050 $700 $1,800 $800 $141,400 $283,695 New York 31,500 15,250 20,400 22,600 1,014,415 566,920 Philadelphia... 4,800 50 4,200 200 101,000 312,450 Cleveland * 1,200 1,850 100 1,100 36,410 295,390 Richmond 650 2,050 1,000 33,500 91,980 Atlanta 70,400 12,900 122,100 18,200 960,500 525,830 Chicago 19,600 5,400 7,400 2,600 921,000 129,335 St. Louis 18,800 5,550 323,200 1,100 1,961,500 373,720 Minneapolis 50 1,250 1,200 58,000 66,250 Kansas City.... 1,400 14,200 1,300 1,800 310,950 754,820 Dallas San Francisco.. 5,350 8,300 3,100 10,400 226,605 | 106,560 Total 158,800 67,500 483,600 61,000 5,765,280 3,506,950 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT1 NO. 11 DALLAS. 567 EXHIBIT 23.—Cost of new Federal Reserve notes printed during year 1917. Cost of printing Federal Reserve notes during January, 1917 (details not available) $652. 99 Cost of printing Federal Reserve notes during February, 1917 : Fives, 85,000 sheets, Aalue $1,700,000; tens, 93,000 sheets, value $3,720,000 6,117.50 Cost of printing Federal Reserve notes during March, 1917 : Fives, 61,000 sheets, value $1,220,000; tens, 71,000 sheets, value $2,840,000; twenties, 44 000 sheets, value $3,520,000; fifties, 9,000 sheets, value $1,800,000; hundreds, 8,000 sheets, value $3,200,000 6,633.02 Cost of printing Federal Reserve notes during April, 1917 : 84,000 sheets, value $3,700,000 (further details unavailable) 2,886.91 Cost of printing Federal Reserve notes during March, 1917 (details unavailable) - 3> 093. 12 Cost of printing Federal Reserve notes during period June 1 to 18, 1917, inclusive : Fives, 42,000 sheets, value $840,000 ; tens, 20,000 sheets, value $800,000 - 2, 130. 82 Cost of printing Federal Reserve notes during period June 19 to 30, 1917, inclusive : Fives, 54,000 sheets, value $1,080,000 ; tens, 23,000 sheets, value $9,200,000—- 2,646.33 Cost of printing Federal Reserve notes during July, August, and September, 1917 : Fives, 2,000 sheets, value $40,000; twenties, 22,000 sheets, value $1,760,000 877. 44 During the year we paid a total of $2,746.79 postage on transporting our new and •unissued Federal Reserve notes between places of custody. This necessitated payment of insurance covering these shipments as follows : Washington to Dallas, $20,860,000___ $2,503.20 Washington to St. Louis Subtreasury, for our account, $11,480,000 1, 148. 00 St. Louis Subtreasury to Dallas, $4,800,000 696. 00 Total 4, 347. 20 EXHIBIT 24.—Statement showing total items handled through the district clearing house for 12 months ending Dec. SI, 1917. Items handled. Amount handled. With Without With Without service service service service charges. charges. charges. charges. 1917. January 286,928 25,427 747,289. 20 $26,423,472.78 February.. 246,108 23,113 746,051.78 24,853,171.80 March 288,075 27,870 055,645.75 28,992,748.18 April 263,836 26,300 073,912.86 29,536,386.94 May 242,044 41,135 571,703.72 34,146,761.97 June 248.329 24,701 988,548.71 36,823,190.04 July 234,065 24,513 209,055.53 30,450,449.85 August 239,227 24,586 826,134.04 35,947,651.20 September. 247,739 35,650 073,740.10 41,137,358.39 October 366,9^8 39,111 987,609.75 73,137,116.06 November. 326,276 35,030 007,754.56 66,319,565.08 December.. 363,095 37,114 242,748.78 60,904,236.82 Total 3,352,670 364,550 501,530,194.78 488,672,109.11 Disbursement, district clearing house $51,262.80 Cost per item handled with service charges .01529 Cost per item, includng those handled without service charges . 01379 Cost per $1,000 handled with service charges . 10221 Cost per $1,000, including those handled without service charges . 05177 EXHIBIT 25.—Funds paid out and received through gold-settlement fund during year 1917. Total payments received through medium of gold-settlement fund during 1917 • £647, 424, 000 Total payments made through medium of gold-settlement fund during 1917 .__.__ _ , _.,,.^ ^_..,-^,^^^ 637, 849, 800 W WW T Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

568 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. To verify above figures: Gold-settlement fund balance Dec. 31, 1916 14,946,500 Funds received during year, as above 647, 424, 000 Total 662, 370, 500 Funds transferred during year, as above 637, 849, 800 Gold-settlement fund balance Dec. 31, 1917 24, 520, 700 EXHIBIT 25A.—Statement shoicing by months the gold settlement fund settlements and resultant balances, both debit and credit, for year 1917. Funds wired Funds wired I Debitt Credit Month. by us. to us. balances. balances. January... $37, 5J22,000 $32,097,000 $5,425,000 February. 28,'429,000 24.837,000 3,592,000 March 29,1049,000 30,214,000 $1,165,000 April. 29,;392,000 32,669,000 3,277,000 May 40, {052,000 47,345,000 7,293,000 June 32,'945,000 47,349,000 14,404,000 July 33,:297,000 34,855,000 1,558,000 August 40, i881,000 47,443,000 6,562,000 September 43,:291,000 50,120,000 6,829,000 October... 75,1006,000 97,245,000 22,239,000 D N e o. c v e e m m b b e e r r. ! , 7 7 4 2_ , ,7 2 :1 1 4 8 2 , , 0 0 0 0 0 0 8 7 8 5 , , 1 0 6 1 0 0 , , 0 0 0 0 0 0 16,0 7 1 9 8 2 , , 0 0 0 0 0 0 Totalforyear ! 536,224,000 ! C07,344,000 9,017,000 80,137,000 Net for year ! ! 71,120,000 71,120,000 EXHIBIT 26.—Statement shoicing amount of currency and coin shipped to member banks by months, during 1917, detailed as to nature and denomination. PAPER MONEY. Ones and Month. twos. Fives. Tens. Twenties. Other. January $61,200 $109,500 $551,000 $464,000 $179,000 February 114,800 145,250 681,000 445,000 431,350 March 118,903 322,250 1,077,500 702,500 1,828,000 April 158,500 260,500 711,000 584,500 609,000 May 136,800 278,160 517,580 588,600 95,000 June 195,872 343,200 523,500 411,000 84,000 July 123,500 257,500 591,100 496,000 81,500 August 517,200 1,375,800 2,323,000 3,669,000 422,000 September 425,000 2,386,000 3,919,500 3,712,000 91,000 October 320,350 1,586,100 3,424,500 3,560,000 453,900 November 282,550 951,165 3,162,750 3,844,000 535,500 December 313,352 320,250 1,032,500 1,018,160 274,000 Total 2,768,027 8,335,675 I 18,514,930 19,494,760 5,084,250 SILVER AND SUBSIDIARY COIN. Month. January $2,000 $8,860 $441 $1,376,001 February.. 10,600 12,235 1,240 1,841,475 March 10,000 13,325 1,500 4,073,978 April 8,300 23,000 1,335 2,356,135 May 17,650 10,800 1,180 1,645,770 June 32,700 34,490 1,570 1,626,331 July 15,300 23,100 575 1,588,575 August 54,950 156,200 23,420 8,541,570 September. 142,000 206,680 ,37,200 10,919,380 October 103,750 •279,725 28,505 9,756,830 November., 62,800 33,200 5,220 8,877,185 December.. 37,500 99,875 18,765 3,114,402 Total, 497.&50 901,490 120,951 55,717,632 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 11 DALLAS. 569 Exhibit 21.—Operations of Liberty loan department. FIRST LIBERTY LOAN. Total amount of bonds subscribed for $48, 962, 000 Total amount of bonds subscribed for by nonmember banks $0,190, 200 Banks and individual subscriptions through member banks $39, 771, 800 Total number of subscribers 93, 707 Total number of individual subscribers 92,475 Total number of subscriptions by corporations 410 Total number of subscriptions by member banks 434 Total number of subscriptions by nonmember banks 388 SECOND LIBERTY LOAN. Total amount of bonds subscribed for #77, 899, 850 Total amount of bonds subscribed for by nonmember banks $20, 878, 900 Banks and individual subscriptions through member banks $57, 020, 950 Total number of subscribers 250, 206 Total number of subscriptions through member banks 153, 266 Total number of subscriptions through nonmember banks 96, 940 Treasury certificates of indebtedness. Number Total Issue of— Group, or allotment to subscriber. s o cr f ib s e u r b s - . am lo o tt u e n d t s t o aleach group. r. 25. $25,000 and less.... $1,280,000 $50,000 and less.... 860,000 $100,000 and less.. 635,000 $250,000 and less.. 1,775,000 $500,000 and less.. 950,000 $1,000,000 and less. 1,500,000 7,000,000 May 10. $25,000 and less.... 133 1,470,000 $50,000 and less 33 1,500,000 $100,000 and less... 12 1,095,000 $250,000 and less... 5 960,000 $500,000 and less... 1 500,000 5,525,000 May 25. $25,000 and less.... 155 1,095,000 $50,000 and less 15 483,000 $100,000 and less... 9 541,000 $250,000 and less... 2 281,000 2,400,000 June 8., $25,000 and less.... 80 791,000 $50,000 and less 15 690,000 $100,000 and less... 9 815,000 $250,000 and less.. . 3 492,000 $1,000,000 and less. 1 512,000 3,300,000 Aug. 9.. $25,000 and less.... 84 965,000 $50,000 and less.... 19 I 835,000 $100,000 and less... 690,000 $250,000 and less... 1,190,000 $500,000 and less... 1,020,000 4,700,000 Aug. 28.. $25,000 and less.... 50 i 544,000 $50,000 and less.... 14 ! 645,000 $100,000 and less... 6 I 552,000 $250,000 and less... 689,000 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

570 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. Treasury certificates of indebtedness—Continued. Total Number amounts al- Issue of— Group, or allotment to subscriber. of sub- lotted to scribers. each group. Sept. 17. $25,000 and less... $759,000 $50,000 and less... 625,000 $100,000 and less.. 365,000 $250,000 and less.. 200,000 $500,000 and less.. 418,000 2,367,000 Sept. 26. $25,000 and less... 174 2,289,000 $50,000 and less... 58 2,486,000 , $100,000 and less.. 19 1,735,000 ! $250,000 and less.. 1,700,000 \ $500,000 and less.. 2,385,000 10,595,000 Oct 18. $25,000 and less.... 196 2,738,000 $50,000 and less.... 65 2,930,000 $100,000 and less... 27 2,400,000 $250,000 and less... 10 1 805,000 $500,000 and less... 3 1,100,000 $1,000,000 and less. 2 1,065,000 12,038,000 Oct. 24. $25,000 and less 142 2,047,000 $50,000 and less.... 38 1,670,000 $100,000 and less... 15 1,380,000 $250,000 and less... 4 675,000 $500,000 and less... 1 445,000 $1,000,000 and less. 1 1,000,000 7,217,000 Nov. 30.. $25,000 and less.... 502,500 $50,000 and less.... 1,007, 000 $100,000 and less... 849,000 $250,000 and less... 1,030,000 $1,000,000 and less. 2,000,000 5, 388,500 62,960 500 UNITED STATES CERTIFICATES OF INDEBTEDNESS. Purchases. Disposition. Maturity. Rate. From T D re e a p s a u rt r - y b F a r n o k m s. Total. S b o a l n d k t s o . m H a e tu ld r i t t o y. Total. ment. Per cent. June 29,1917 2 $2,000,000 $2,000,000 $2,000,000 $2,000,000 June 30,1917 3 900,000 900,000 $900,000 900,000 July 17,1917 3 65,000 $15,000 80,000 65,000 15,000 80,000 July 30,1917 31 14,000 263,000 277,000 14,000 263,000 277,000 Nov. 15,1917 3* 595,000 283,000 878,000 207,000 671,000 878,000 Nov. 22,1917 667,000 845,000 1,512,000 667,000 845,000 1,512,000 Nov. 30,1917........ 34 11,000 140,000 151.000 10,000 141,000 151,000 Dec. 15,1917 428,000 120,000 548,000 170,000 378,000 548,000 Do f 1,585,000 2,120,000 3, 705,000 1,660,000 2,045,000 3, 705,000 June 25, 1918 215,000 215,000 215,000 215,000 Total 4 6,480,000 3,780,000 10,266,000 3,908,, 000 6,358,000 10,266,000 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 11 DALLAS. 571 EXHIBIT 28.—Statement of expenditures during year. First loan. Second loan. Total. Salaries $15,994.30 $19,720.36 $35,714.66 Traveling '416.35 2,595.43 3,011.78 Telephone and telegraph. 199.25 6,180.54 6,379.79 Postage 3,674.04 3,876.55 7,550.59 Printing and stationery... 956.54 14,919.61 15,876.15 Sundry accounts paid 10,483.73 10,403.48 20,887.21 Miscellaneous expenses..., 437.86 1,884.18 2.322.04 Total. 32,162.07 59,580.15 91.742.22 Reimbursements by Treasury Department: First loan, $22,369.95; second loan, $5,426.71; total, $27,792.66. On December 31, 1917, there were employed 67 clerks in the war loan department, excluding the two officers in charge. 34365°—18—37 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 12.—SAN FRANCISCO. JOHN PERRIN, Chairman and Federal Reserve Agent. FINANCIAL RESULTS OF OPERATIONS. COMPARATIVE STATEMENT. The large growth of the Federal Reserve Bank of San Francisco during the past two years is shown in the following comparative statement: Dec. 31,1917. Dec. 31,1916. Dec. 31,1915. RESOURCES. Total gold reserve $94,018,470 $35,815,250 $20,380,960 Legal tender notes 408,823 78, 678 4,778 Total reserves 94,427,293 35,893,928 20,385,738 Bills discounted, members 25,780,201 250,968 467,162 Bills bought in open market 17,082,456 12,462,266 683,840 Total bills on hand 42,862,657 12,713,234 1,151,002 United States Government long-term securities 2,455,000 2,633,750 1,000,475 United States Government short-term securities 1,500,000 500,000 Municipal warrants 737,376 344,978 Total earning assets 46,817,657 16,584,360 2,496,455 Due from other Federal reserve banks, net 5,908.934 4,294,110 3,924,326 Uncollected items. . 12,809,375 3,846,266 213,708 Total deductions from gross deposits 18,718,309 8,140,376 4,138,034 Real estate 120,000 All other resources 463,807 92,471 Total resources ... 160,547,066 60,618,664 27,112,698 LIABILITIES. Capital paid in 4,162,450 $3,929,300 $3,941,800 Government deposits.. 12,353,939 3,643,138 427,321 Due members' reserve account ... 63,779,910 37,852,376 17,509,725 Due nonmember banks, clearing account 2,620,985 Collection items . 9,885,477 2,030,467 21,832 Total gross deposits 88,640,311 43,525,981 17,958,878 Feredal reserve notes in actual circulation 67,744,305 13,098,115 5,212,020 All other liabilities 65,268 Total liabilities... 160,547,066 60,618,664 27,112,698 It will be observed that the amounts due to member banks have approximately doubled in each of the past two years, while the gold reserve has increased in still greater proportion. The development 573 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

574 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. of rediscounting. for member banks is shown in the growth from an insignificant total at the beginning of the year to $25,780,201 at the close. The total discounted during the year 1916 was $1,973,355, which compares with $102,981,205 during the year 1917. During the first five months of 1917 the discounts aggregated approximately $1,500,000, while in the month of June alone they exceeded $9,000,000. This large increase was, of course, occasioned by the requirements growing out qf payments in connection with the first Liberty loan. The discounts during the month of November aggregated $26,964,721, the first important payment on the second Liberty loan falling due in that month. EARNINGS, EXPENSES, AND DIVIDENDS. The important increase in earnings is shown in the following comparative statement: 1917 1916 EARNINGS. Bills discounted for members $292,981.91 $20,682.97 Acceptances bought 308,595.60 133,331.07 United States securities 147,355.24 67,529. 54 Municipal warrants 11,934.70 49,772.61 Profits realized on United States securities. 11,250.00 14,487.50 Penalties for deficient reserve 18,221.97 Transfers bought and sold, net 64,363.55 18,200.00 Service charges 31,047.40 7,660. 26 Sundry profits 52.08 4,786.15 Total. 885,802.45 316,450.10 Current expense 267,541.28 187,902.73 Cost of Federal reserve notes 43,074.97 56,804.69 Total cost furniture and fixtures. 28,142.34 12,.589. 59 Total 338,758. 59 257,297.01 Net earnings. 547,043.86 59,153.09 Balance profit and loss, Dee. 31, 1916 : $15,416.87 Net earnings 547, 043. 86 Total 562, 460. 73 June 30, 1917, dividend No. 3 $108,356.51 Dec. 31, 1917, dividend No. 4 286,418.85 Contingent reserve 85,000. 00 Depreciation 6,000. 00 485,775.37 Undivided profits 76, 685. 37 The two dividends paid during the year cover the cumulative 6 per cent dividend accrued from March 31, 1915, to December 31, 1916. Dividends remaining unpaid are for the year January 1 to December 31, 1917, amounting to approximately $240,000. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 12—SAN FRANCISCO. 575 Net earnings, by months, have been as follows: January $36, 275. 44 August $50,033. 47 February 17, 394. 27 September 49, 691. 34 March 5, 321.44 October 61, 671. 62 April : 26,199. 79 November 83, 274. 72 May 40, 728. 95 December 106, 313. 76 June 31,495.66 July 37, 743. 40 Total 547, 043. 86 ACTIVITIES DURING THE YEAR, DISCOUNT OPERATIONS. Discounts, which during the year 1916 aggregated $1,973,355, expanded to a total of $102,981,205 during the year 1917 for 156 member banks out of a total of 553. DISCOUNT RATES. The discount rates in force January 1, 1917, were slightly modified on March 1, those for maturities of 60 days or less being advanced one-half per cent and the rate for agricultural and live stock paper having maturities beyond 90 days1 decreased one-half per cent. On April 2 the rate for maturities of 31 to 60 days was decreased one-half per cent. On December 10 the rates for maturities of 60 days and less were again advanced one-half per cent. As the year closes rates range from 4 to 5-| per cent for various maturities, except 3J per cent for member-banks' promissory notes maturing in 15 days or less, secured by Government bonds, and 2| to 4| for bankers' acceptances. As member banks have become familiar with rediscounting they have manifested a steadily growing tendency to offer shorter maturities, and have applied for considerable advances upon their own notes maturing within 15 days or less, collateraled by eligible paper, Liberty bonds, or Treasury certificates of indebtedness. TRADE ACCEPTANCES. There has been increasing interest in trade acceptances, and their use has gained considerable headway in the Pacific Northwest, having been adopted by the grain dealers and millers of the Northwest and by the West Coast Lumbermen's Association. It appears that chambers of commerce and associations of merchants and manufacturers and credit men are more concerned than bankers to secure their adoption. They have every good argument in their favor as against the unavailable open-ledger account, being far surer of prompt payment and providing admirable paper for discount. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

576 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. ACCEPTANCE BUSINESS. During the year $58,640,605 acceptances covering foreign shipments have been purchased, comparing with $32,775,678 during the previous year. These have been chiefly those of bankers and acceptance houses, a smaller amount being those bearing bank indorsement but drawn on strong mercantile or manufacturing concerns to cover goods imported. A considerable part has been those of Pacificcoast banks for imports from the Orient. However, the embargo against the export of gold, effective September 7, 1917, has served to reduce greatly the volume of bills coming from the Orient. This country's exports of commodities to the Orient being less than its imports, there was no method of settling balances except by exports of gold. When the embargo stopped these, imports of commodities were curtailed, because payments to a certain extent could only take the form of credits which could not be withdrawn or used. In San Francisco the same actual rates as in New York have been maintained for acceptances. An amendment to the Federal Eeserve Act approved September 7, 1916, provided for domestic acceptances. It was thought that a large volume of such bills would develop. Thus far, however, this has not proved true. The total volume of domestic acceptances bought by this bank during the period from September 7, 1916, to December 31,1917, has been $6,809,694. Member bank acceptances have been purchased at rates slightly lower than those of nonmember banks. UNITED STATES BOND OPERATIONS. In January $1,000,000 United States 3 per cent conversion bonds were sold at a premium of $11,250. This was the only transaction in obligations of the United States aside from Liberty loan bonds and Treasury certificates of indebtedness. MUNICIPAL WARRANTS. The total purchases of municipal warrants during the year, almost wholly in January, aggregated $785,394.21, comparing with $5,962 r 621.14 purchased during the year 1916. The discontinuance of such purchases was with a view to conserving the banks' resources for accommodation of member banks. RESERVE POSITION. Table 2 shows the reserve position of the bank at the end of each month during the year. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 12 SAN FKANCISCO. 577 THE FEDERAL EESERVE BANK AND MEMBER BANKS, MOVEMENT OF MEMBERSHIP WITHIN THE DISTRICT. The number of national banks in this district increased during the year from 522 to 536. This increase consisted of 12 newly organized and 11 conversions from State banks, partially offset by the voluntary liquidation of 9. Of those liquidating, all but 4 were absorbed bv other national banks. STATE BANKS AND TRUST COMPANIES. The deposits of national banks in this district are approximately $1,000,000,000 and those of State banks $1,200,000,000. National banks presumably have a larger proportion of demand deposits, so that as members of the Federal Reserve system their required reserve with Federal Reserve Bank would be a larger percentage of their deposits. Therefore if all State banks were members it is probable that the deposits of Federal Reserve Bank would be approximately doubled and its strength likewise doubled. The stability of the financial structure, of which the State banks constitute more than half, unavoidably depends upon the sustaining power of the Federal Reserve system. In the present situation, with State banks outside of Federal Reserve system, the base beneath this huge fabric is one-half of what it might be and should be, especially in view of possible financial strains ahead. In this district there are 1,321 State banks and trust companies, including 152 branches, of which 685 have capital and surplus such as to render them eligible for membership. In addition there are 223 which are desirable as members but have insufficient capital and surplus to meet requirements of membership. Thus far the following have become members: Capital Name. and Resources. surplus. Coffman Dobson Bank & Trust Co., Chehalis, Wash $250,000 $1,800,000 Spokane & Eastern Trust Co., Spokane, Wash 1,200,000 11,259,000 Live Stock State Bank, North Portland, Oreg 110,000 688,000 Bank of Rosalia, Rosalia, Wash 30,000 334,000 First Savings & Trust Bank of Whitman County, Colfax, Wash 65,000 786,000 Genesee Exchange Bank, Genesee, Idaho 37,500 536,000 Dexter Horton Trust & Savings Bank, Seattle, Wash 500,000 7,907,000 Metropolitan Bank, Seattle, Wash 300,000 3,081,000 Ladd & Tilton Bank, Portland, Oreg 2,000,000 21,669,000 First State Bank, La Crosse, Wash 68,000 570,000 Bank of Kimberly, Kimberly, Idaho 46,250 292,000 State Bank of Wilbur, Wilbur, Wash 55,000 815,000 Northwestern State Bank, South Bellingham, Wash 145,000 1,474,000 Butler Banking Co., Hood River, Oreg 125,000 915,000 Farmers State Bank, Reardpn, Wash 32,500 592,000 Lumberman's Bank, Hoquiam, Wash 112,500 610,000 Fidelity Trust Co., Tacoma, Wash 800,000 6,634,000 Total 5,876,750 60,952,000 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

578 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. In addition to these there have been filed applications of eight banks having $2,626,500 capital and surplus and $18,641,000 resources. In the States of Washington. Oregon, and Idaho quite active and definite inclination for membership has been manifested. The State bank superintendents of Oregon and Idaho, by circular letters to banks under their jurisdiction, have urged all eligible banks to join the Federal Reserve system. It is probable that a good many banks in these three States would quickly make application for membership if it were possible for the officers of Federal Reserve Bank to personally point the way and explain the vital need of the country that each eligible bank add its quota of strength. The advantages of membership to the banks themselves are so great and so obvious to those understanding the workings of the system that it seems no persuasion should be required. The provisions of the California bank act present some obstacles to membership. A State bank or trust company in becoming a member bank would not only be required to carry with the Federal Reserve Bank the reserve deposit such as required of national banks, but would also be required to carry reserve in vault not required of national banks, amounting in the case of city banks to 9 per cent of demand deposits. In addition to this, savings departments are permitted to invest in commercial, rediscountable paper to an amount equal to only 5 per cent of savings deposits. There is earnest desire on the part of the State banks, especially of Los Angeles and San Francisco, to secure a modification of the State bank act so as to permit membership without disadvantage, a modification such as has been made in the Pennsylvania law, which in the matter of reserves provides only that State banks becoming members of the Federal Reserve system shall carry reserves as required by the Federal Reserve Act. The banks of Los Angeles, during the fall, took the initiative in having a conference with San Francisco and Oakland banks, seeking concurrent action of all in applying for membership. Banks having deposits approximating a total of $500,000,000 were represented. A committee was appointed which visited Washington and conferred with the Federal Reserve Board with regard to possible amendments to the Federal Reserve Act. While these banks have taken no definite steps as yet toward membership, their interest presumably has not diminished. From a patriotic viewpoint the obligation resting upon this great group of banks is so important that there seems reason to hope for favorable action. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 12—SAN FRANCISCO. 579 ACCOMMODATION OF MEMBER BANKS THROUGH DISCOUNTS. Rediscounts, exclusive of member banks' collateral notes, by months for the year 1917 have been as follows: January $123, 358 August $3, 393, 523 February 106, 785 September 7, 668, 213 March 151,522 October 7,976,461 April 698, 888 November 10,900,421 May 450,599 December 23, 582, 580 June 9, 058, 095 July 4,804, 56S Total—..- 68,915,013 Classification by maturities of paper rediscounted is shown in Table 1. DEPOSITS FROM MEMBER BANKS. On January 1, 1917, deposits from member banks aggregated $35,656,826, and on December 31 had grown to $63,779,910, while deposits from nonmember banks for clearing purposes, which were nonexistent at the beginning of the year, amounted to $2,620,985 on December 31. Deficiencies in required reserve deposits during 11 months averaged $215,000, which were taxed at 6f per cent per annum, viz, a rate 2 per cent above the 90 days' discount rate. The payments on this account during this period have aggregated $13,966.38. It is obviously more advantageous for member banks to obtain funds by rediscounting, which is possible at a rate as low as 3^ per cent. To advance funds to member banks by rediscounting likewise impairs the resources of a Federal Reserve Bank less than withdrawal of an equal amount from its reserves. PERIODIC REPORTS REGARDING CONDITION OF MEMBER BANKS EXAMINA- TIONS OF MEMBER BANKS. Weekly reports are furnished by member banks showing their daily totals of demand and time deposits and required reserve deposits with Federal Reserve Bank. Those having net deposits less than $1,000,000 give only the figures of each Friday. No occasion has arisen for any special examination of member banks during the year. BANK FAILURES WITHIN THE DISTRICT. In this district no national bank has failed since the establishment of the Federal Reserve system. Failures of State banks during the year have been as follows: In Arizona, Commercial Bank of Parker; in Washington, BroadwTay State Bank, Northern Bank & Trust Co., German-American Mercantile Bank, and Fremont State Bank, all of Seattle. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

580 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. OVERDUE PAPER. Some days before maturity this bank forwards rediscounted paper for collection, usually to the bank from which received, charging to that bank's account on the day of maturity. There has been no instance of overdue paper and no loss through these transactions. BRANCHES. From the time of the establishment of the Federal Eeserve Bank of San Francisco, bankers and business men of the Pacific Northwest urged the location of a branch in that region, the principal cities of which are two or more days by mail from San Francisco. It was deemed wise, however, to give first attention to the development and organization of the head office and to defer establishing branches until after the several successive payments on account of capital and reserve deposits had been made. On April 3, 1917, a conference was called in San Francisco to take the matter under definite consideration, those present being the Hon. A. C. Miller, of the Federal Reserve Board, representatives of the clearing-house banks of Portland, Seattle, and Spokane. The determination reached was that, instead of a single branch serving the Pacific Northwest, it was desirable to establish, at least tentatively, three branches, one at each of the points named. It was recognized that whenever experience proved that the service required at any point was of too little importance to justify the expense of operation, a branch could readily be discontinued or modified in character. Spokane bankers urged that the first branch be established there, in view of the impending need for rediscounting in connection with handling the maturing wheat crop, and, as evidence of cooperation of the clearing-house banks, proposed that, if the branch were established, (a) the clearing-house banks would employ the branch to conduct the clearing-house examinations, paying as compensation an amount equal to the previous cost of conducting such examinations, and (b) all clearing-house State banks and trust companies would maintain reserve deposits with the branch in the same percentages as if they were member banks, and subject to the same penalties for deficiencies. The Spokane branch was accordingly established, opening for business on July 26, 1917, its territory being eastern Washington and northern Idaho. Upon the same basis of cooperation of clearing-house banks, the Seattle branch was established and opened for business on September 19, 1917, with western Washington as its territory, and the Portland branch on October 1, 1917, with the State of Oregon as its territory. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 12 SAN FRANCISCO. 581 In importance of operations Seattle leads, with Portland and Spokane following in the order named. The great shipbuilding, lumbering, and import and export operations now centering at Seattle, largely expanded by war activities, have occasioned an exceptional volume of transactions there. Camp Lewis, near Tacoma, with 40,000 or more soldiers, adds to Seattle's pay-roll requirements. Up to December 13, 1917, the total amount of Federal reserve notes shipped to the respective branches has been as follows: Seattle, $8,175,000; Portland, $5,425,000; Spokane, $2,690,000. While it is anticipated that these branches will show reasonable earnings, it is recognized that their value can not be measured by earnings but by the service they render. It is beyond question that the important territory situated in the Pacific Northwest, more remote from a Federal reserve bank than is any other section of the country, is tremendously benefited by these branches. The financial status of the respective branches on November 30 was as follows: Deposits, Branch. Members. p C a a id p it i a n l . Un ex it c e l d u d S i t n a g tes deposits. Portland 80 national banks, 3 State banks $448,000.00 $8,292,272.46 Seattle 31 national banks, 2 State banks 291,000.00 8,197.289.32 Spokane 59 national banks, 3 State banks 269,000.00 5,549,611.96 While capital paid in by the member banks attached to each branch is shown as a separate amount, this is only as a matter of bookkeeping, since the operations of a branch are in nowise limited or determined by the amount of capital. In other words, the accommodation and service which a branch extends are no more limited than if extended by a head office without branches. The bankers of Salt Lake City have expressed a strong desire to have a branch located there, but have not as yet arranged for the same measure of cooperation by both State and national banks as was done at Spokane, Seattle, and Portland. Salt Lake City and tributary territory would doubtless find a branch of advantage, since the city is located approximately 24 hours from the nearest larger city. Adequate supplies of gold, Federal Reserve notes, and credit, immediately at hand, would obviously give security and stability not otherwise possible. THE FEDERAL RESERVE BANK AND THE PUBLIC. OPEN-MARKET OPERATIONS. In the open market a total of $52,532,168 bankers' acceptances have been purchased during the year and $15,733,940 bank-indorsed foreign trade acceptances, Rates have been within the limits of 2 to 4^ per cent, authorized by the Federal Reserve Board, being highest Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

582 ANNUAL REPOET OF THE FEDERAL RESERVE BOARD. during the latter part of the year, though not reaching the higher limit. The total held at one time has fluctuated between $3,924,381.66 on October 31 and $23,029,460 on December 13. EFFECT OF DISCOUNT-RATE POLICY UPON GENERAL MARKET RATES. During the previous year the discount operations of the Federal Reserve Bank had little perceptible influence upon general market rates, but during the current year, particularly the latter half, the discount operations have been of such increased volume, growing out of necessities connected with financing Government loans and crop movements, that the influence has been important in adding steadiness. Federal Reserve Bank's discount rates have remained substantially unchanged since January, 1915, there having been only fractional advances for shorter maturities. General market rates have shown a somewhat firmer tendency, but the constantly available privilege of rediscounting at exceptionally moderate rates has both enabled member banks to meet all their customers' legitimate requirements and has maintained an unexampled stability of rates. In many instances1 and to a degree far beyond previous experience the Federal Reserve Bank has been called upon to extend unusual accommodations in carrying member banks over peak loads. PUBLICITY WORK OF THE BANK AND ATTITUDE OF THE PUBLIC TOWARD THE SYSTEM. The absorbing attention demanded for the rapidly expanding volume and complexity of current operations has rendered it impracticable to undertake any publicity work during the year. The fact that the Federal Reserve Bank as fiscal agent of the Government has been the center from which activities have radiated in connection with the two great Liberty loan campaigns has, of course, brought it before the public in an extraordinary way. The public generally and gratefully recognizes the vital service which the Federal Reserve System has rendered during the year as a \rast sustaining power under conditions of unprecedented financial strain. The comment is frequent that without the Federal Reserve System financial convulsion could not have been avoided. THE FEDERAL RESERVE BANK AND THE GOVERNMENT. RELATION TO THE COMPTROLLER'S OFFICE. Except in connection with Federal reserve notes, this bank has had little direct dealings with the office of the Comptroller of the Currency. With Mr. Claud Gatch, however, the chief national bank examiner of this district, frequent communication has been had and not infrequently also with the examiners under his direction. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 12 SAN FRANCISCO. 583 A spirit of most cordial cooperation and helpfulness has been invariably shown. Copies of considerable parts of the reports of examinations of national banks have been filed with the Federal reserve agent and fuller information given upon request. GOVERNMENT DEPOSITS. On the first day of each month of the past year Government deposits with this bank have been as follows, an occasional large sum being an unexpended balance derived from payments for Liberty bonds: January $3, 679, 633.15 July $1, 779,172. 07 February 2, 776, 722. 84 August 818, 570. 23 March 1, 715, 612. 03 September 2, 826, 401. 21 April 3, 391, 645. 88 October 5, 022,190. 29 May 12, 258, 442.10 November 18,100,899. 98 June 6, 836, 449. 51 December 42, 927,205. 30 RELATION TO THE UNITED STATES TREASURY. Particularly in its service as fiscal agent of the Government, this bank has had important relations with the Treasury Department. In San Francisco all Government funds hitherto deposited in national banks, except court and post-office deposits, are now deposited with the Federal Reserve Bank. A large volume of warrants drawn upon the Treasurer of the United States are presented for payment at this bank and its branches, particularly Seattle. During the month October 16 to November 15 these items averaged 1,270 per day, amounting to $3,554,297, or more than double the amount at any other Federal reserve bank except at New York, where the average daily amount was $6,610,037. WAR LOANS. The supreme service as fiscal agent, however, and one which has severely tested the capacity of the management of the Federal Reserve Bank, has been in connection with the sale and distribution of the Government's war securities in this district. FIRST LIBERTY LOAN. On May 15,1917, the preliminary organization for the first Liberty loan was effected at a meeting of San Francisco bank presidents and bond dealers called by the chairman of the board of the Federal Reserve Bank, who suggested that the governor of the Federal Reserve Bank be made chairman of the general executive committee to centralize the direction in the Federal Reserve Bank. A general executive committee was chosen, having supervision of the entire twelfth Federal Reserve district. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

584 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. The State was used as the larger basis of organization, and a State chairman, generally a banker of some standing, was appointed by the general chairman in each of the seven States of the district. This State chairman in turn suggested the nomination of his local com^ mittee chairmen, who were then appointed by the executive committee at San Francisco. A special representative, generally a member of some local bond house, was assigned to cooperate with each State chairman, to put into effect the definite plan of campaign of working through the banks to reach their depositors, and in general to aid in formulating an effective organization. The general distribution committee had responsibility for the campaign initiated by it for appealing through banks to their depositors, and for following up by direct methods the work of obtaining subscriptions through the agency of appointed salesmen, etc. Besides supervising all committees in the district the general organization committee managed the sales in San Francisco. The general publicity committee handled copy for newspaper publicity, both in San Francisco and throughout the district; arranged the distribution of posters and campaign literature; arranged addresses before conventions, organizations, etc.; encouraged subscriptions of employees; arranged parades, mass meetings, etc. Wherever practicable, local committees were modeled after those in San Francisco. The finance committee had jurisdiction of allowances for expense of committees, of campaign budget, and of tabulation of quotas. The executive manager was the guiding spirit in the campaign, and most of the questions of policy were decided by him. He was continually in direct communication with the seven State chairmen and all local committees, and sent out to committees a daily bulletin covering department rulings and general news items of interest to the workers. There was no precedent by which to determine the amount of energy and extent of organization required to market an issue of $2,000,000,000 bonds, so there was great uncertainty at all stages. The period was brief in which to create an organization and secure subscriptions for the allotted quota; but an inspiring readiness to help was generally manifested, both in subscribing and in working to secure subscriptions. Apathy of farmers as a class in subscribing for the bonds was, however, quite generally reported and lack of cooperation with the Liberty loan committees. In a hastily organized campaign it was inevitable that there should be duplication of effort and occasional frictions, but total subscriptions of $175,623,900, with a so-called minimum allotment of $140,000,000 and maximum of $175,000,000, prove the essential effectiveness of the work done in the first campaign. The campaign closed on June 15—one month after the first meeting. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 12 SAN FRANCISCO. 585 The accounting work in connection with the first Liberty loan was conducted in the restricted quarters occupied by the Federal Keserve Bank. The lack of space enhanced extraordinary difficulties incident to handling a vast volume of unaccustomed transactions by a hastily gathered and wholly inadequate force, numbering a maximum of 66 individuals. It was inevitable that some confusion and consequent delays should result. SECOND LIBERTY LOAN. After the first Liberty loan was closed, much consideration was given to improving the organization for the second. In accordance with the request of the Secretary of the Treasury to maintain the established organization, the same general executive board was continued, with some additions, James K. Lynch serving as ex officio chairman, he having meanwhile been elected governor of the Federal Eeserve Bank to succeed A. C. Kains, resigned. A general advisory council of 104 members was chosen from the district at large and appointed by the Secretary of the Treasury. This council included the governor of each State, chairmen of the State councils of defense, and other prominent men. As in the first campaign, each State was held responsible for the success of the campaign within its own confines, each State being divided into several auxiliary sections, which in turn were subdivided into local divisions. Special representatives were again sent out to perfect State and local organization and to cooperate with the State chairman. The first meeting of the general executive committee was held on August 20, and the campaign closed October 27. More time, more careful preparation, and valuable experience gained in the first campaign all aided in the second. In the latter there was superior organization, although the formulated plans were not rigidly followed. In the first campaign there was perhaps greater patriotic enthusiasm, with more of grim determination in the second. So vast an undertaking, carried to splendid success through volunteer effort, evidences a fine patriotism and remarkable spirit of cooperation. The total subscriptions were $292,889,300. To avoid the accounting difficulties experienced in the first loan, the fiscal agent department of the Federal Eeserve Bank was established apart from the bank in ground-floor rooms of the Mills Building some three blocks distant. Later it became necessary to occupy space on the third floor in order to accommodate the staff, which grew to 130 members and still continues approximately at this number, new work having been added in connection with war savings certificates and thrift stamps. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

586 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. This force, laboring under handicaps of hasty gathering and lack of coordination, has shown a spirit of devotion born of real patriotism. The same was true in equal degree of the accounting force in the first loan. Even with the greatly larger force and fuller experience in the second campaign it has not been possible to avoid confusion, delay, and complaint. There has been no lack of industry but, because trained men have not been available, it has been increasingly necessary to employ many not trained for difficult work. Subscriptions and allotments to the two loans were as follows: First Liberty loan. Second Liberty loan. Total subscriptions $175, 623, 900 Total number of subscriptions 582,162 Allotments: To individuals 1, 559, 900 By individuals $349, 000 To corporations 2, 962, 000 By corporations 2, 532, 900 To member banks— 74, 499, 700 By member banks__ 164, 337. 250 T o non m e m ber B y n o n in ember banks 54, 672, 400 banks 125, 670, 150 Total 133, 694, 000 Total 292, 889, 800 Allotted 261,138, 000 Second Liberty loan of 1917. Number of subscrib- Amoimts subscribed. ers in each group. Amounts subscribed. N e u r m s i b n e r e a o c f h s u g b ro sc u r p i . b- $50 274, 004 $25,050 to $50,000 603 $100 177, 162 $50,050 to $100,000 299 $150 to $500 89,817 $100,050 to $250,000 131 $550 to $1,000 27,217 $250,050 to $500,000 38 $1,050 to $5,000 9, 679 $1,000,000 and over 29 $5,050 to $10,000 2,193 $10,050 to $25,000 990 Total 582,162 It will be noted that fewer than three in every hundred subscribers bought amounts over $1,000. In addition to the foregoing, there have been received by Federal Reserve Bank 2,163 subscriptions for various issues of Treasury certificates, as follows, bearing the dates indicated: Mar. 31, 19171 $2, 500, 000 Sept. 17, 1917 $9, 030, 000 Apr. 25, 1917 20, 000, 000 Sept. 26, 1917 23, 000, 000 May 10, 1917 7, 500, 000 Oct. 18, 1917 20, 000, 000 May 25, 1917 4, 200, 000 Oct. 24, 1917 13, 408, 000 June 8, 1917 5, 200, 000Nov. 30, 1917 3, 762, 000 Aug. 9, 1917 13, 000, 000 Aug. 28, 1917 7, 520, 000 Total 129,120, 000 1 Subscribed by Federal Reserve Bank. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 12 SAN FRANCISCO. 587 Classification by denominations of subscriptions is shown in Table 3. The Federal Keserve Bank owns United States securities as follows: 2 per cent consols $2,429,000 3 per cent 1-year Treasury notes 1, 500, 000 31 per cent Liberty bonds____ 26, 000 Total 3, 953, 000 No Treasury certificates are now owned, although the Federal Reserve Bank has at times owned considerable amounts, the maximum being $3,793,000 on October 6, and has in every instance repurchased from member banks whenever requested. Member banks' promissory notes collateraled by United States bonds and Treasury certificates have been discounted as follows: July $400, 000 October $4, 562, 000 August 1, 261, 000 November 7, 059, 500 September . 1, 494, 400 December 5,127, 925 On December 31, 1917, the total held of such loans was $1,017,688. The number of new employees engaged, salaries paid, and expenses incurred in the conduct of operations connected with Liberty loans, Treasury certificates, war savings certificates, and thrift stamps were as follows: e N m u p m lo b y e e r e o s f . Salaries. Expenses. First loan—May 15-Dcc. 31... G6 $54,013.86 §152,036.05 Second loan—Sept. 1-Dec. 31. 130 75,723.62 222,607.05 A partial account of these expenses, amounting to $128,614.70, has been rendered to the Secretary of the Treasury and reimbursement received. A further account is in preparation. It was an unprecedented thing to endeavor to sell bonds in amounts so large in proportion to banking resources, a minimum for this district of $140,000,000 in the first loan and a minimum of $210,000,000 in the second. There were varying opinions as to the effect of successful flotations upon the banking situation and upon industries and commerce. By some it was believed that the district would be drained of its circulating medium—its actual money. By others, who saw the operation more clearly as a series of credit transactions, it was feared that those banks extending credit to customers to buy Liberty bonds would have their loanable funds so absorbed that they would be unable to meet the necessary requirements of commerce. 34365°—18 38 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

588 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. Many feared that, for investment in Liberty bonds, particularly if bearing a rate of 4 per cent or more, savings deposits might be withdrawn to the point of embarrassment of savings banks. The published reports of banks give a fair indication of the actual results. In some States such reports of State banks are not compiled in sufficiently detailed form to make the desired comparisons possible; consequently only the trend can be deduced from reports of part of the banks instead of a complete exposition tabulated from the reports of all. DATES OF IMPORTANT PAYMENTS OF THE TWO LOANS, First loan: June 28,1917,18 per cent; July 30, 20 per cent; August 15, 30 per cent; August 30, 30 per cent. Second loan: November 15, 1917, 18 per cent; December 15, 40 per cent; January 15, 1918, 40 per cent. Deposits. (1) ALL NATIONAL BANKS, TWELFTH DISTRICT. Total deposits, Total deposits, including excluding Government Government deposits. deposits. 1917. June 20 - $885 647,000 $871,390 000 Sept. 11 $931,816,000 $917,465,000 Increo se $46,169,000 $46,075,000 Per cent 5.21 5.20 Sept 11 . . $931,816,000 $917,405, 000 Nov 20 . $1,017,287,000 $952,281, 000 Increase . $85,471,000 $34,816,000 Per cent 9.2 3.8 (2) NATIONAL BANKS IN RESERVE CITIES, TWELFTH DISTRICT. June 20 $513,681,000 $505,412,000 Sept 11 $554,839,000 $546,683,000 TncrPi^ $41,158,000 $41,271,000 Per cent 8 8.4 Sept 11 $554,839,000 $546,683,000 Nov 20 $606,450,000 $569,810,000 $51,611,000 323,127,000 Per cent 9.3 4.2 (3) NATIONAL BANKS OUTSIDE RESERVE CITIES, TWELFTH DISTRICT. June 20 $371,966,000 $365,978,000 Sept. 11 $376,977,000 $370,782,000 Incren.se ..... . $5,011,000 $4,804,000 Per cent 1.4 1.3 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 12—SAST FRANCISCO. 589 Time deposits. (4) ALL NATIONAL BANKS, TWELFTH DISTRICT. Time deposits. 1917. May l $160,065,000 June 20 162,900,000 Increase.... 2,835,000 Percent 1.9 June 20 162,900,000 Sept. 11 179,275,000 Increase. 16;375,000 Per cent 10.05 (5) SAVINGS DEPOSITS OF ALL CALIFORNIA STATE BANKS, SAVINGS BANKS, AND TRUST COMPANIES. Savings deposits. 1917. June 20 $596,325 000 Nov. 20 606,205,000 Increase.. 9,880,000 Percent 1.66 Between the two reports of national banks published on the Comptroller's calls June 20 and September 11, the four important payments, 98 per cent, were made upon the first Liberty loan, the total amount being $133,694,000. Nevertheless, between those two dates the combined deposits of all national banks of this district showed an increase of $46,169,000, equal to 5.21 per cent. (See (1) above.) A part of these banks in making payment received back a deposit of Government funds. Such transactions would cause an increase in their Government deposits. Excluding Government deposits on both dates, the increase was $46,075,000, equal to 5.20 per cent. Of those amounts, national banks in reserve cities (Los Angeles, Cal.; Ogden, Utah; Portland, Oreg.; Salt Lake City, Utah; San Francisco, Cal.; Seattle, Wash.; Spokane, Wash.; and Tacoma, Wash.) gained in total deposits $41,- 158,000, equal to 8 per cent, and excluding Government deposits gained $41,271,000, equal to 8.4 per cent. (See (2) above.) This shows a decrease and not an increase in Government deposits. National banks outside reserve cities gained in total deposits $5,011,000, equal to 1.4 per cent, and excluding Government deposits gained $4,804,000, equal to 1.3 per cent. (See (3) above.) It appears, therefore, that even excluding Government deposits, the combined deposits of all national banks increased during the time that $133,694,000 of first Liberty loan bonds were bought and Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

590 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. paid for in this district, but that the increase was somewhat greater in reserve city banks than in banks outside reserve cities. Time deposits, which, it might be thought, would be drawn upon for investment in Libert}^ bonds, increased in even greater proportion. (See (4) above.) Between June 20 and the date of the preceding call, that is, before any important payment was made on the first Liberty loan, time deposits of all national banks increased $2,835,000, equal to 1.9 per cent, but between June 20 and September 11, during which 98 per cent was paid on this loan, the increase in time deposits was $16,375,000, equal to 10.05 per cent. (See (4) above.) On November 15 the first important payment became due on the second Liberty loan, the allotments of which aggregated $261,138,000. Payment of only 18 per cent was then required, but many subscriptions were paid in full, the total payments aggregating $167,259,000, equal to 64 per cent of the entire allotments. Between Comptroller's calls of September 11 and November 20, in spite of the payment of this great sum, deposits of all national banks increased $85,471,000, equal to 9.2 per cent, but Government deposits in these banks in the same period increased $50,655,000, equal to 355 per cent. Excluding the latter, the increase was $34,816,000, equal to 3.8 per cent. (See (1) above.) Between the same dates, deposits of national banks in the eight reserve cities increased $51,- 611,000, equal to 9.3 per cent. Excluding Government deposits, the increase was $23,127,000, equal to 4.2 per cent, (See (2) above.) This shows that while there was a general increase in deposits, there was a greater increase in reserve cities than outside. Between June 20 and November 20, savings deposits of all California State banks, savings banks, and trust companies combined show an increase of $9,880,000, equal to 1.66 per cent (see (5) above), showing that savings depositors are so prospering through continuous employment at high wages that the new deposits have somewhat more than offset the withdrawals for investment in Liberty bonds. Between June 20 and November 20, while national banks in reserve cities gained $64,398,000, 12.7 per cent, in deposits, excluding those of the United States, their loans increased only $27,265,000, 8 per cent. This group, which includes the larger commercial banks, would probably feel the chief pressure of any emergency demand for loans. Its resources constitute approximately 60 per cent of the total resources of all national banks in the district. Thus in five months $468,513,200 Liberty bonds were subscribed, of which $394,832,000 were allotted, and payments made aggregating $300,953,000. In spite of this deposits of both commercial and savings banks have increased, with a materially smaller proportion of increase in loans. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 12—:SAN FRANCISCO. 591 Money lias not been shipped out of the district. The conclusion is inevitable that the general bank position is stronger than before the Liberty loans were offered. The economic explanation is of course that, in effect, this district has paid for $300,000,000 of Liberty bonds with ships, metals, agricultural products, etc., at very high prices. It is not surprising that bank clearings should be making new records and that industry and commerce should be generally active and prosperous. THE FEDERAL RESERVE BANK AND NOTE ISSUES. GENERAL POLICY. It has been the general policy of this bank to substitute Federal Reserve notes for gold whenever possible. This has been difficult on the Pacific coast where custom for more than half a century has made gold the ordinary medium. The use here of gold for currency has been more than a custom; it has been a pride and, it might be said, almost a religion, grounded in the discovery of gold in California in 1849, which first attracted conspicuous attention to the possibilities of this section, and fostered by the production in California and Alaska since then of hundreds of millions of gold. Gold dust, gold slugs, as well as gold coins were used as money here when a depreciated currency circulated elsewThere throughout the country. The custom and prejudice of the people favor the use of gold as currency. Purses are adapted to it. Bank tellers trained to handle gold find it bothersome to handle paper to which they are unaccustomed. The gradual introduction of national-bank circulation made some progress toward a change. The panic of 1907 caused scrip to circulate. People were glad to get it when gold was unobtainable. The Aldrich-Vreeland issues in the fall of 1914 also found favor because of the relief they brought at a crisis. For nearly three years after the establishment of the Federal Reserve Bank it was found possible to issue only a relatively small amount of Federal Reserve notes. With the enactment of the amended reserve provisions approved June 21, 1917, a change in the situation began, gold in more important volume flowed to the Federal Reserve Bank and Federal Reserve notes issued in exchange. Army and Navy paymasters, who had hitherto made up their pay rolls with gold, received official instructions to use Federal Reserve notes, the Treasury giving gold to the Federal Reserve Bank in exchange. A good many millions of Federal Reserve notes have been shipped to the Seattle branch for use in pay rolls at Camp Lewis. The Assistant Treasurer at San Francisco has made Federal Reserve notes his ordinary counter money, paying gold only when de- Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

592 AKNTTAL REPORT OF THE FEDEKAL RESERVE BOARD. manded. The San Francisco Mint has adopted the method of making payment by checks on the Treasury, which are paid by the Subtreasury chiefly in Federal Reserve notes. It was arranged that the Subtreasury become a member of the San Francisco Clearing House and settle its balances through the Federal Reserve Bank, again minimizing the use of gold for settlements. From Portland gold has always been shipped to points down the Columbia River to pay the fishermen. It was found that this gold never returned. Federal Reserve notes have been substituted for this service. Taxes in California, State, county, and city, are payable in gold and until recently were collected almost entirely in gold. By cooperation of treasurers, it has now been arranged that Federal Reserve notes and cashiers' checks of the Federal Reserve Bank be used for the principal part of such payments. The Federal Reserve Bank now pays express charges on gold or gold certificates shipped to it and prepays charges on Federal Reserve notes sent in exchange. The appeal of the President, made on October 13, 1917, to State banks to join the Federal Reserve system as a patriotic duty in order to build up to the maximum its gold reserve has called important attention to the fact that the Nation is financially able to withstand strains in direct proportion to the extent of the gold reserve of the Federal Reserve system. It is perhaps not generally comprehended that a holder of a Federal Reserve note has to that extent deposited gold in the Federal Reserve Bank, and that anyone paying out a Federal Reserve note by the same act pays gold into the Federal Reserve Bank. Paying money thus offers opportunity to every bank teller to render patriotic service by aiding in the financial fortification of the country. This wave of substitution of Federal Reserve notes for gold has had a striking effect upon the volume of Federal Reserve notes issued by this bank. At the beginning of the year 1917 only $14,000,000 were outstanding. This had expanded to less than $25,000,000 when the amended reserve provisions became effective June 21, 1917. The amount had risen to $41,900,000 at the end of October, to $58,400,000 at the end of November, and to $77,097,550 at the end of December. Frequent reference is made in press comments to the large volume of Federal Reserve notes outstanding, as if they were additions to the currency in circulation, whereas they are largely issued in place of gold which is absorbed into Federal Reserve Bank reserves. Gold in circulation serves no purpose which paper credit currency does not adequately serve. But in a Federal Reserve Bank's reserve gold multiplies its power, every dollar constituting the potential basis for two and a half dollars of credit for the needs of commerce. The following illustrates the fact that gold is absorbed into the Federal Reserve Bank's reserve as Federal Reserve notes are paid Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 12—SAN FRANCISCO. 593 out: On September 1 Federal Reserve notes outstanding were $28,- 434,930 and net deposits $53,402,231.52, amounting together to $81,- 837,161.52. The combined gold reserve held against both amounted to $57,270,522.50, or 70 per cent. On December 1 notes outstanding were $58,402,405; net deposits, $77,474,184.11; combined gold reserve, $96,367,990 or 71 per cent. It will be seen that $39,097,468 gold was added to reserve, although the increase in deposits was only $24,071,953. At the end of December Federal Reserve notes outstanding were $77,097,550; net deposits, $69,922,002; and combined gold reserve, $94,018,470, or 64 per cent. By denominations, Federal Reserve notes issued have been as follows: Issued 1917. Redeemed 1917. Fives $11,700,000 $1 729,430 Tens. 17,600 000 955 690 Twenties .. 25,120 000 1 496'670 Fifties 4 400 000 146 150 Hundreds 8,000^000 175,'600 Total 160,820,000 4,503,540 i Net amount outstanding Tec. 31, 1917, $77,097,550. INTERDISTRICT MOVEMENT OF NOTES. Federal Reserve notes have been received from and 'returned to other Federal Reserve Banks as follows: January-November, inclusive $3, 783, 290 Returned 1, 502,110 Largest exchanges have been with Federal Reserve Bank of New York: Received from Federal Reserve Bank, New York $2, 254, 540 Returned to Federal Reserve Bank, New York „ 331, 025 That Federal Reserve notes issued in one district have relatively small circulation in other districts is shown by the fact that from January 1 to November 30 the total of the notes of this bank received by other Federal Reserve Banks amounted to only $3,783,290. Under the provisions of the Federal Reserve Act, these were returned to the issuing bank. In the same period this bank returned notes of other Federal Reserve Banks to an amount of $1,502,110. Of these amounts $2,254,540 of this bank's notes were received from the Federal Reserve Bank of New York and $331,025 of that bank's notes returned to it. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

594 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. INTERNAL. MANAGEMENT OF THE BANK. FUNCTION AND WORK OF DIRECTORS, EXECUTIVE COMMITTEE, AND STAFF- A list of officers and directors is given in Table 4. Directors' meetings are held with great regularity and excellent attendance on the first and third Tuesdays of each month. Information regarding the bank's activities is furnished in considerable detail, and all matters of general policy are considered by the board. The executive committee is rarely convened. Rediscounts and loans are first authorized over the signatures of the governor or deputy governor and the chairman, the other members of the executive committee signing at their convenience and after such investigation as each desires. Since the inauguration of the Liberty-loan campaigns the governor ? as chairman of the general committee, has given his attention largely to these. In consequence the deputy governor has borne the brunt of the executive work in the bank. An assistant deputy governor was appointed to assist, but for a temporary period it became necessary to have him serve as acting manager of the Portland branch, an assistant cashier of the head office later taking this place. Another assistant cashier of the head office also served as acting manager of the Seattle branch, and was subsequently appointed manager. Three trained employees of the head office have also served as acting cashiers of the three branches, two of them subsequently being appointed cashiers. This draft upon its staff has placed a heavy pressure upon the head office during the exceptional demands of the past few months, and while both official and clerical staffs have been largely expanded, they are still inadequate. The force of the fiscal agent department, though large, has been quickly gathered and has not as yet been properly organized for best results. The difficulty is generally recognized of obtaining skilled clerks at this time. There has been no change during the year in the personnel of the directors of class A and of class B. Of the class C directors, the class appointed by the Federal Reserve Board, Mr. Claud Gatch, chief national bank examiner, completed the term of his appointment with end of the year 1916, and, in conformity with the policy of the Federal Reserve Board that national bank examiners shall not be directors, he was unavailable for reappointment. On January 4, 1917 Mr. E. C. Bradley, former vice president of Pacific Tele- ? phone & Telegraph Co., was appointed to succeed him. After serving a brief period he was called to Washington to act as assistant to the Secretary of the Interior, and necessarily resigned as director. On April 23, 1917, Mr. Edward Elliott, professor of international Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 12—SAN FRANCISCO. 595 law in the University of California, and of the law firm of Lane & Elliott, was appointed as Mr. Bradley's successor. On July 5, 1917, Mr. A. C. Kains resigned as governor, and on August 7, 1917, Mr. J. K. Lynch, class A director, was appointed as his successor. Although it is the policy of the Federal Reserve Board that a governor of a Federal Reserve Bank shall not at the same time be a director, the Board permitted Mr. Lynch to complete his term ending with December 31, 1917. In the regular election of directors, completed in December, Mr. J. E. Fishburn, president of the Merchants' National Bank of Los Angeles, was elected to succeed him. Mr. A. B. C. Dohrmann, class B director, was reelected. For the systematic guidance and supervision of branches Mr. John IT. Calkins, deputy governor, was appointed deputy governor in charge of branches, with the purpose of his frequently visiting the branches in person. On July 17, 1917, Mr. William A. Day, previously assistant cashier of the Savings Union Bank & Trust Co., of San Francisco, was appointed assistant deputy governor, and from September 26, 1917, to December 14, 1917, served as director and acting manager of the Portland branch. Other official appointments were as follows: June 6, 1917, Mr. Ira Clerk, as assistant cashier; December 14, 1917, Mr. W. N. Ambrose, acting manager Portland branch; Mr. C. J. Shepherd, assistant cashier, served as acting cashier Spokane branch, from July 26, 1917, to September 18, 1917, and from September 18, 1917, to December 18, 1917, served as director and acting manager Seattle branch, being appointed manager Seattle branch on December 18,1917; December 18, 1917, Mr. J. C. Galbraithe, cashier Seattle branch; December 18, 1917, Mr. C. R. Shaw, cashier Spokane branch; September 26, 1917, Mr. H. N. Mangels, acting cashier Portland branch; October 29, 1917, Mr. C. S. Loveland, examiner Portland branch; October 29, 1917, Mr. E. B, McBride, assistant examiner Spokane branch; December 18, 1917, Mr. H. S. House, auditor. Upon inauguration of preparations for the second Liberty loan the fiscal agent department of the bank was quartered in the Mills Building, three blocks from the bank, and Mr. G. O. Bordwell, cashier, assumed entire charge of its operations. The following is a list of the members of the bank's staff who have entered military or naval service: J. B. Watts, corporal, Three hundred and sixty-third Regiment, National Army; Nat Neal, Coast Artillery; Emmett Cashin, Aviation Corps; Donald Henderson, Ambulance Corps; F. W. Kiser, yeoman, first class, United States Navy; Homer E. Malaby, ensign, Paymaster's Department; Thomas E. Graves, first lieutenant, Aviation Section, Officers' Signal Reserve Corps; Judson Swift, Sixty-second Machine Gun Corps; Sam H. Davis, jr., Company D, United States Naval Reserve; Monroe Baer, Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

596 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. One hundred and sixty-sixth Depot Brigade; T. O'Connor, Seventieth Company, One hundred and sixty-sixth Depot Brigade; R. S. Paden, sergeant, Quartermaster's Department; Thomas S. Marlor, lieutenant, United States Geological Survey; Fred Bobbins, Three hundred and twenty-second field battalion, Signal Corps, Ninetyfirst Infantry Division; Harry B. Fuller, sergeant chauffeur, Quartermaster's Department: G, J. Concannon, Company F, Fourth Battalion, Twentieth Engineer Corps. OFFICE AND VAULT FACILITIES BANK PKEMISES. The present office of this bank, occupied from the outset, grows increasingly inadequate. During the year a small additional space has been obtained, but further expansion at this location seems impracticable, and exhaustive search discloses no other available quarters. The fact that the business part of this city has been entirely rebuilt within 10 years measureably accounts for this. The vault is approached through the quarters of the lessor bank, with which it is jointly used. The Subtreasury has courteously placed considerable vault space at the disposal of the bank, and this has given a measure of relief. The fiscal agent department has been established for the time being in an office building a few blocks distant. Its requirements have extended be}^ond the available ground floor space, so that parts of the force are accommodated in various offices above. The increasing requirements for greater space and the apparent impossibility of finding adequate quarters with proper vault facilities have led the directors to decide that the construction of a building for the bank's use is necessary. At an expense of $120,000 an appropriate site has therefore been purchased, approximately 120 feet square, with frontage on three streets, assuring unusual provision for light. Building plans are now under consideration. CHECK COLLECTIONS. During the year the check collections of this bank have steadily increased, the total to November 30 aggregating 2,367,015 items, amounting to $1,082,192,465, a daily average of 8,564 items, amounting to $13,554,053. The number of banks using the collection system has gradually increased, but approximately 80 per cent of the checks handled have been received from other districts, chiefly from New York and Chicago. Banks in this district using the system have been largely those in reserve cities, although the smaller banks have manifested a growing disposition to benefit by the advantages as they gain information. The establishment of branches at three centers in the Northwest has served to greatly expedite collection of checks drawn on banks in Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT KO. 12 SAX FRANCISCO. 597 that section, which increases the value of the check-collection service. Every effort is made to reduce the time of collection to the minimum, and to give quickest returns possible, thus reducing the " float," that is, the amount of outstanding collections. Proceeds of checks deposited for collection are made available for the depositing bank on the day scheduled for arrival of checks at destination. On request, authority is given for sending checks direct to branches, the proceeds being made available as a credit with head office on the day of expected arrival at branches. By arrangement, a bank may also send checks direct to the banks upon which drawn, credit being given by Federal Reserve Bank on the day checks are scheduled to reach the drawee banks. To cover the cost of handling, a service charge is made of 1| cents for each item, but no charge is made on the first 500 checks received from any bank in one calendar month. For a considerable time this bank collected, by express, checks drawn on nonmember banks which refused par remittance. On October 20, 1917, express collections were discontinued and thereafter a par list has been used. From this list those banks are excluded which refuse par remittance and checks drawn upon them, are not accepted by Federal Reserve Banks or their branches. At the time of discontinuance, checks upon 122 banks were being collected by express, There are now 136 banks which refuse to remit at par and checks drawn upon them are consequently refused by Federal Reserve Bank and its branches. Including 152 branches of State banks there are 1,321 State banks in this district. Approximately 90 per cent remit at par. During the year much progress has been made in developing methods for the settlement of clearing-house balances through Federal Reserve Bank. Los Angeles clearing-house banks, all of whom are member banks, initiated the movement, arranging that after each day's clearings the clearing-house manager certifies by telegraph the balances due from and due to the clearing banks. Federal Reserve Bank then enters the proper credits and debits upon its books and telegraphs confirmation. This plan has worked smoothly since its inauguration July 16, 1917. On the same date San Francisco banks began settling clearing-house balances through Federal Reserve Bank. Although the clearing-house manager certifies to Federal Reserve Bank the amounts due to and due from the several banks, this serves as authority only for receiving and crediting the amounts due creditor banks. With one or two exceptions each debtor bank draws its draft on and sends it to Federal Reserve Bank for the amount of its debtor balance. At Spokane, Seattle, and Portland, clearing balances are settled through the respective branches of Federal Reserve Bank. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

598 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. . The service rendered by the check collection and clearing systems is of such fundamental advantage in reducing " float" by avoiding circuitous collection methods and in economizing the use of actual money that an increasing use will surely result. Another service of great value is that rendered by the gold-settlement fund, deposited in the Treasury at Washington subject to the order of the Federal Reserve Board. Through this device, for example, Federal Reserve Bank of San Francisco transfers for its members by telegraph gold from San Francisco to New York and from New York to San Francisco with no charge except for the telegrams. It serves for transfers between all Federal Reserve Banks or their branches. GENERAL BUSINESS CONDITIONS. Shipbuilding has probably been the most conspicuous single factor in the activities of this district during the first year of participation in the war. There has been vast expansion in the operations of established shipbuilding concerns and many new companies have organized for constructing both steel and wooden ships. San Francisco now has the largest shipbuilding plant in the United States, and this industry, confined here almost wholly to steel construction, has expanded enormously. While Seattle has had the greatest development of new concerns, in which many thousands of men are now employed, shipbuilding at Portland has likewise assumed vast proportions. At Portland and Seattle both steel and wooden ships are building. At Los Angeles too, important construction is under way. A most interesting enterprise is the construction of a reinforcedconcrete ship of some 5,000 tons, at a point near San Francisco. Vessels of this character of 200 or 300 tons have hitherto been successfully constructed, but this is the first instance of such a vessel of any considerable size. The smaller ones, at least in some instances, have been built keel up, then with hatches tight have been launched upside down, quickly righting when floated. It is proposed to launch the large vessel side wise. If this vessel proves a success, it will be important as the cost will be little more than one-third that of steel. Furthermore, steel is now difficult to obtain, while cement is readily available, made more so by discontinuance of road construction and decrease in building operations. The lumbering industry has been handicapped by lack of transportation and by labor troubles, menacing I. W. W. disturbances having developed at times in the Northwest, where the latest factor has been an embargo on fir to hold it for the Emergency Fleet Corporation and for aeroplane construction. Had it not been for such difficulties, the lumbering industry would have shown phenomenal results for the year. The actual results, however, have been suf- Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 12—SAN FRANCISCO. 599 ficiently favorable to impart substantial commercial activity to all sections in which lumbering is important, dissipating the sluggishness which has clogged them for several years. Revival in lumbering and vast development in shipbuilding have given special advantages to Seattle and Portland at this time. Mining of all kinds has been exceedingly active in this district and for the most part profitable. It is estimated that mining dividends for 1917 in the territory known as the inland empire, of which Spokane is the center, will aggregate approximately $100,000,000. The metals there are chiefly lead, zinc, copper, and magnesite. The United States Geological Survey estimates that, except as to zinc ore and concentrates, the production in the first six months of 1917 has equaled the entire output of 1916. Copper mining has continued on a huge scale throughout the year, although maximum output has not been reached because of labor troubles, I. W. W. disturbances having especially affected the Arizona mines. The value of copper mined in Arizona during 1917 is estimated at $200,000,000, other metals $60,000,000. The production of petroleum in California has fallen far below consumption. During 1017 production was 97,267,832 barrels and shipments were 108,853,457, reducing stored stocks fom 44,036,190 barrels on December 31, 1916, to 32,450,465 barrels. Stored stocks on December 31, 1915, were 57,147,051 barrels. In many respects the year 1917 has been unfavorable for agricultural products. The spring was cold and backward in the Northwest, with hot winds and deficient moisture in the later season. The Washington wheat crop was about 27,000,000 bushels against 45,000,- 000 the preceding year. The yield of barley in Oregon, Washington, Idaho, and Nevada was about 18 per cent less than in 1916, but in California there was a considerable increase. In California the area planted in beans increased from 253,000 acres in 1916 to 395,000 acres, the yield being nearly double, an estimated total of 9.280,000 bushels. In 1912 the acreage in rice was 1,400. This was increased yearly until in 1917, 90,000 acres were planted. These typify the agricultural situation of the year, some crops poor, some good. There was, however, such an effort for large product, stimulated by both patriotism and extraordinary prices, that in spite of unfavorable conditions the product of foodstuffs in the entire district was exceptionally large. There were many abundant yields in California—35.000 tons more raisins than ever before; more peaches than in 1916 by 1,300,000 bushels; a record number of carloads of deciduous fruits and perishable commodities; shipments of citrus fruits, aggregating 54,361 carloads, surpassed all previous Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

600 ANNUAL KEPOET OF THE FEDERAL RESERVE BOARD. records. The apple crop of Idaho, Oregon, and Washington was large. The salmon pack of Alaska was exceptional. Present forecasts of next year's production of foodstuffs would be sheerest guessing, because there is ample time for any unfavorable condition to be righted. Concern is, however, -being felt because of the lack of precipitation in California, there having been only about 10 to 15 per cent of the normal seasonal precipitation. In the wheat regions of the Northwest the fall planting was practically a failure. Later rains have made the conditions there such as to be promising for spring planting. In spite of curtailment of available range, the high price of feed, and the difficulty in securing labor, live stock holdings in the Pacific Northwest, according to Government estimates, generally showed slight increase on December 31, 1917, over the same date in 1916. In Oregon, Washington, and Idaho the holdings of cattle, excluding milch cows, increased from 2,055,000 head to 2,165,000 head during this period; of milch cows from 623,000 to 633,000 head; of sheep from 6,141,000 to 6,306,000 head. Holdings of swine decreased from 890,000 to 811,000 head. Total live-stock holdings increased 206,000 head, or 2.1 per cent. Labor is unsettled and there have been many strikes, though there are none of importance as the year closes. Import and export trade, in spite of deficient tonnage, is at record volume. Seattle's foreign trade exceeds that of San Francisco, the totals for the two being, respectively, $480,000,000 and $400,000,000. Building permits during the past five months are 17 per cent less than in 1916. Bank deposits, bank clearings, and post-office receipts are continually making new high records. The year has been one of great agricultural, industrial, and commercial activity and prosperity in this district. This reflects the fact that it has made important contribution of products vitally necessary for winning the war. TABLE 1.—Classification by maturities of paper rediscounted. MATURITIES. 15 days Over 15 to Over 30 to Over 60 to Over 90 Month. and less. 30 days. 60 days. 90 days. days to 8 Total. months. January 14,514 S25, $37, 707 $47,705 $123,358 February.. 25,931 34, 32,344 4,540 106, 783 March 46. 74,157 21,990 151,521 April 120,302 216, 139,828 21,814 698,887 May........ 50,254 132, 125,995 27,147 450,599 June 460,935 2,883, 089,878 103,351 9,058,096 July 842,881 i;os7, 437,418 42,387 4,178,987 August 1,216,019 877, 636,470 188,277 3,393; 522 September. 1,520.765 2, 762, 344,130 161,927 7,668,211 October 2,19?; 799 1,923, 971,127 20,224 7,976,463 November.. 2,296,856 3,803, 655,771 171,165 10,900,421 December.. 2,910,940 9,7IS, 981,795 240,221 23,582,580 Total 11,647,193 13,382,892 23,511,975 18,526,620 1,220,748 68,289,431 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT 2\0. 12 SAN FRANCISCO. 601 TABLE 2.—Reserve position of Federal Reserve Bank of San Francisco at the end of each month during the year 1917. Federal Gold and gold Gold with Reserve certificates, Other Federal Total gold Month. Net deposits. notes out- gold settle- cash. Reserve reserve. standing. ment fund. agent. January... $32,911,714.14 $15,726,890 $20,893,505. 00 $82,879.10 $15, 726,890 $36,620395.00 February. 33, 715,308.10 16,195,845 21,070,995. 00 31,551. fO 16,195,845 37,266:840. 00 March 39,049,682. 53 16,205,545 27,040,167. 50 65,343. 35 16,207,545 43,247;712. 50 April 30,841,247.13 19,954,290 21,337,340. 00 102,393.05 19,954,290 41,291!630.00 May 39,064;838.49 22.843,600 20,345,645. 00 I114,299.35 22,843,600 43,189:245.00 June 61,127,208.14 24; 387, 600 35,494,235. 00 141,412.20 24,387,600 59,881!835.00 July 64,561,712. 33 26,088,230 45,319,530. 00 92; 587. 00 26,088,230 71,407!760. 00 August 53', 402.231. 52 28,431,930 28,835,592. 50 45,849.80 28,434,930 57,270!522. 50 September 52,422,235. 60 36,420,270 37,665,360. 00 33,772.40 26,516,270 64,18l!630. 00 October... 54,082,569. 58 41,903,470 40.968,910, 00 62,064.35 30,949,470 71,918!380. 00 November. 77.474.184.11 58,402', 405 57; 769,585. 00 83,775.60 38,598,405 96.367!990. 00 December. 09,922,002.00 77,097,550 47,024;920. 00 408; 822,55 46,993,550 94,018,470.00 NOTE.—An amendment to the Federal Reserve act approved June 21,1917, includes in reserve gold with the Federal Ileserve agent. For easier comparison, this table is constructed as if this provision had been in effect throughout the year. TABLE 3.—Report of Treasury certificates of indebtedness subscribed for through Federal Reserve Bank, San Francisco, during 1917. Series. Mar. 31... Apr 25 May 10 .. May 25 June 8 Aug. 9... Aug. 28 Sept.17.. Sept. 26.. Oct. 18 Oct. 24. Nov. 30.. „. Total Series. Mar. 31 Apr. 25.. May 10 Mav 25 Juiie 8... Aug. 9. .. Aug. 28 Sept. 17.. Sp.nt. 2fi c oc $1,000 to $25,000. $25,000 to $50,000. $50,000 to $100,000. $100,000 to $250,000. N b u e m r. - Amount, N b u e m r. - Amount. N b u e m r. - Amount. N b u e m r. - Amount. 143 $1,990,000 48 $2,220,000 30 $2,835,000 14 $2,740,000 121 1,322,000 24 1,138,000 13 1,195,000 12 2,545,000 132 1,237.000 14 ' 498,000 10 635,000 6 930,000 71 833;000 18 792.000 15 1.425,000 7 1,350,000 94 1, 254,000 26 1,160,000 10 '920,000 10 1,945,000 100 1,268,000 23 987,000 22 1,940,000 13 2,925,000 too 1, 252', 000 27 1,120,000 20 1,885,000 18 3,890,000 227 2,910,000 60 2, 750,000 54 5,145,000 35 6,637,000 209 2, 968; 000 88 • 4.075,000 47 4, 431,000 31 5,801.000 79 1,007.000 42 1,871,000 29 2,765,000 18 3, 795; 000 19 ' 9175. 000 4 167,000 400,000 6 970,000 1,295 16,316,000 374 16, 778,000 254 23,576,000 170 33,528,000 $500,000 to $250,000 to $500,000. $1,000,000. $1,000,000. Total. N b u e m r. - Amount. N b u e m r. - Amount. N b u e m r. - Amount. N b u e m r. - Amount, 1 $2,500,000 1 $2,500,000 12 $4,835,000 3 $2,700 000 1 2,680,000 251 20,000,000 1.300'. 000 173 7,500;OOO 3 | 'i!oo,n.'io 165 4,200,000 2 8?)-') •:•!».) 113 5,200,000 8 750.000 2 3,421,000 151 13,000,000 1 " 40'7 •i'j'i' 159 7,520,000 1 374." 000 509,000 167 9,030,000 9 A r*)\) i); .) 600,000 1 1,458,000 387 23,000,000 I 2, 200,0!Ht 1 525,000 383 20,000,000 Oct. 24. 3,970,000 177 13,408,000 Nov. 30... 500,000 2 1,450,000 36 3,762,000 Total... 56 22,329, QUO 9 6,534,000 5 10,059,000 2,163 129,120,000 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

602 ANNUAL REPORT OF THE FEDEEAL RESERVE BOARD. TABLE 4.—Officers and directors of Federal Reserve Bank of San Francisco. DIRECTORS. Class A.—Alclen Anderson, term expires December 31, 1918; C. K. Mclntosh, term expires December 31, 1910; J. E. Fishburn, term expires December 31, 1920, Class B.—Elmer II. Cox, term expires December 31, 1919; A. B. C. Dolirmann, term expires December 31, 1920; John A. McGregor, term expires December 31, 1913. Class C.—Edward Elliott, term expires December 31, 1919; Walton N. Moore, term expires December 31, 1918; John Perrin, term expires December 31, 1920. OFFICERS. John Perrin. chairman of the board and Federal Reserve agent; James K. Lynch, governor; John U. Calkins, deputy governor in charge of branches; William A. Day, assistant} deputy governor; George O. Bordwell, cashier; Ira Clerk, assistant cashier; W. N. Ambrose, assistant cashier and acting manager Portland branch. BRANCH DIRECTORS AND OFFICERS. Portland: W N. Ambrose, assistant cashier of head office, acting manager; % A. L. Mills, president First National Bank; J. C. Ainsworth, president United States National Bank; Nathan Strauss, of Fleischner & Meyer; Judge Thomas C. Burke; H. N. Mangels,1 acting cashier. Seattle: Clifford J. Shepherd, manager; M. F. Backus, president National Bank of Commerce; N. H. La timer, president Dexter Horton National Bank; Charles E. Peabody, capitalist; Charles H. Clarke, of Kelley-Clarke Co.; J. C. Galbraithe,1 acting cashier. Spokane: Charles A. McLean, manager; D. W. Twohy, president Old National Bank; Edwin T. Coman, president Exchange National Bank; Peter McGregor, farmer; G. I. Toevs, manager Centennial Mill Co.; Clarence li. Shaw, cashier. TABLE 5.—Comparison of deposits and of loans and discounts of national banks of the twelfth Federal Reserve district on Nov. 17, 1016, and Nov. 20, 1017. DEPOSITS. Nov. 20, 1917. Nov. 17 1916. Increase. i P n e c r r e c a e s n e t . Reserve cities: Los Angeles $100,582,000 $73,884,000 §26,698,000 36 San Francisco.. 292,314.000 196,227,000 96,087,000 49 Portland 70,666;000 42,273,000 28,393,000 40 Salt Lake City. 23,890,000 20,451,000 3,439,000 17 Seattle 64,396,000 42,480,000 21,916,000 52 Spokane 32,639,000 20,446,000 12,193,000 37 Tacoma 11,970,000 7,491,000 4,479,000 60 Ogden 9,993,000 9,332,000 661,000 Total. 606,450,000 412,584,000 193,866,000 47 All national banks: Alaska 182,000 188,000 2 6,000 23 Arizona 9,554,000 7,585,000 1,9.69,000 29 California 618,289,000 522,800,000 95,489.000 18 Idaho 46,842,000 37,898,000 8,944,000 23 Nevada 13,380,000 10,595,000 2,785,000 2o Oregon 114,849,000 96,852,000 17,997,000 18 Utah 46,527,000 33,465,000 13,022, 000 39 Washington 166,674,000 138,466,000 28,208,000 21 Total 1,017,287,000 847,879,000 169,408,000 19 Digitized for FRASER 1 Acting officers from head office. 2 Decrease. http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 12 SAN FRANCISCO. 603 TABLE 5.—Comparison of deposits and of loans and discounts of national banks of the twelfth Federal Reserve district on Nov. 17, 1916, and Nov. 20, 1917—Continued. LOANS AND DISCOUNTS. Beserve cities: Los Angeles $69,426,000 $58,666,000 $10,760,000 18 San Francisco 179,110,000 156,557,000 22,553,000 15 Portland 35,368,000 31,105,000 4,263,000 14 SaH Lake City 14,139,000 15,350,000 U.211,000 16 Seattle 34,737,000 28,915,000 b,822,000 20 Spokane 22 149 000 17,379 000 4 770,000 24 Tacoma 6 052,000 5,208,000 844,000 16 Ogden 6,632,000 4,952,000 1,680,000 33 Total 367,613,000 318,132,000 49,481,000 16 All national "banks: Alaska, 75,000 46,000 29,000 63 Arizona 5,485,000 4,582,000 903,000 20 California 398,593,000 339,600,000 58,993,000 17 Idaho . . . 30,571,000 22,950,000 7,621,000 33 Nevada 8,068,000 6,178,000 1.890,000 30 Oregon 71 737,000 58,431 000 13,306 000 23 Utah 30,460,000 24,067,000 6,393,000 26 Washington 96,599,000 82,235,000 14,364,000 17 Total 641,513,000 538,089,000 103,424,000 19 i Decrease. TABLE 6.—Comparison of loans, investments, and deposits of national banks on June 30, 191%, with those on corresponding dates in 1913, 1916, and 1917, and on November 20, 1917. LOANS AND INVESTMENTS. Date of call. Amounts. P l m d o e i e r a n e p n v n c o s e e t s s s n a i t t t n t - s o o d . f o P in v c f e i e c e g r r d r u e c i p r n a e e r g s . n e e t - o i P 3 v n 0 e e c , r r r 1 e c 9 J a e 1 u s n 4 n e t . e June 30,1914: Loans $439,092,000 Bonds, etc 140,723,000 579,815,000 100.5 June 23,1915: Loans 440,555,000 Bonds, etc 147,650,000 588,205,000 100.1 1.5 1.5 June 30,1916: Loans . .. 482,570,000 Bonds, etc 157, 255,000 639,825, 000 91.7 8.8 10.4 June 20, 1917: Loans 584,525,000 Bonds, etc 196,952,000 781,477,000 88.2 22.3 33.2 Nov. 20, 1917: Loans 641 513,000 Bonds, etc 245,751; 000 887,264,000 87.2 13.5 52.9 34365°—18- Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

604 ANKUAL REPORT OF THE FEDERAL RESERVE BOARD. TABLE 6.—Comparison of loans, investments, and deposits of national hanks on June 30, 1914, with those on corresponding dates in 1915, 1916, and 1917, and on November 20, 1917—Continued. DEPOSITS. Per cent of Per cent of deposits to increase Per cent Date of call. Amounts. loans and over pre- increase invest- ceding over June ments. figure. 30,1914. June 30,1914 $576,852,000 99.5 June 23,1915 . . 587,678,000 99.9 1.9 1.9 June 30,1916 698,620,000 108.3 18.9 21.1 June 20,1917 885,647,000 113.8 26.7 53.5 Nov. 20,1917 1,017,287,000 114.7 14.9 76.3 TABLE 7.—Federal Reserve notes issued and redeemed by Federal Reserve agent during 1917. Fives. Tens Twenties. Fifties. Hundreds. Total Outstanding Dec. 31,1916, $14,781,090 $11,700,000 $17,600,000 $25,120,000 $4,400,000 $8,000,000 66, 820,000 81,601,090 Unfit notes redeemed,1917.. 1,729,430 955,690 1,496,670 146,150 175,600 4,503,540 Outstanding Dec. 31,1917 . 77,097,550 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 12—SAN FRANCISCO. 605 EXHIBIT A.—Federal Reserve notes outstanding, 1917. Jan. Feb. Mar. Apr. May June July Aug. Sepf. Oct. Nov. Dec. In Mif/ions of Dollars SO 80 70 / / 60 / / 50 / / 40 y / 30 / f <* 20 10 0 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

606 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. EXHIBIT B.—BanJc clearings of principal cities in twelfth district. [In millions; 000,000 omitted.] First 11 1911 1912 1913 1914 1915 1916 months, 1917 Bakersfield 22 24 24 20 28 33 Fresno 51 57 53 54 72 96 17 26 30 35 Los Angeles 1,169 1,211 1,145 1,048 1,284 1,381 Oakland 173 223 189 176 181 223 246 Pasadena 42 47 48 44 44 50 53 Sacramento 78 93 108 103 101 126 146 San Diego 83 132 134 103 100 112 110 San Francisco 2,427 2,678 2,624 2,516 2,694 3,480 4,399 San Jose . 30 36 36 36 35 44 49 Santa Rosa 13 12 13 14 Stockton 40 45 46 47 50 72 82 Reno 15 15 14 15 21 28 P ortland 557 596 628 577 554 650 784 Salt Lake City 369 333 315 350 513 644 61 Seattle 553 602 665 628 612 790 1,042 Spokane 225 219 203 193 255 310 Tacoina 139 133 110 99 115 145 Total 4,966 6,442 6,470 6,124 6,188 7,939 9,685 i Organized 1912. 2 Organized 1914. EXHIBIT C.—Banking poiver of twelfth Federal Reserve district.1 [Resources and liabilities given in thousands; i. e., 000 omitted.] Arizona. California. Idaho. Nevada. National State National State National State National State banks. banks. banks. banks. banks. banks. banks. banks. Number of banks 7 56 270 571 64 137 10 23 Date of report Nov.20 Sept.ll Nov.20 Nov.20 Nov.20 Sept. 11 Nov.20 Sept. 11 RESOURCES. Loans and discounts $5,485 $25,949 $398,593 $575,072 $30,571 $31,098 $8, 068 $10,512 Stocks, bonds, and other, securitties 1,842 4,515 145, 917 218, 233 10,234 3,639 3,457 2,130 Banking house, furniture, and fixtures, and other real estate 330 1,530 17, 761 35,849 1,662 1,797 417 682 Cash and exchange.. 3,578 14, 533 208, 803 142, 786 13,709 14,230 4,353 4,433 Other resources .. . 62 20, 094 21, 261 281 262 314 216 Total 11,297 46,527 79L 168 993,201 56,457 51,026 16, 609 17,973 LIABILITIES. Capital.. 675 2,938 59,525 66,186 3,789 4,042 1,435 1,846 Surplus and undivided profits 680 2,335 48,912 47,042 2,591 1,766 599 640 Due to banks 462 (2) 133,943 20, 594 5,139 2,138 1,726 143 Individual deposits, demand 8,149 41, 025 394, 769 210, 581 32, 438 31, 716 8,974 7,753 Individual deposits, time... 743 (2) 84,577 625,281 9,265 10, 809 2, 610 7,526 Rediscount' 6 620 126 349 158 Money and bonds borrowed. 10, 382 871 140 294 Circulation outstanding 544 40, 813 3 021 1,215 44 <229 18,247 22, 520 74 103 50 65 Total ... 11,297 46,527 791,168 993,201 56,457 51,026 16, 609 17,973 1 Includes 4 counties in eleventh Federal Reserve district. 2 Included in demand deposits. 3 Subtracted from loans and discounts and not included in total liabilities for national banks. 4 Includes rediscounts and money borrowed. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 12—SAN FEANCISCO. 607 EXHIBIT C.—Banking power of twelfth Federal Reserve district—Continued. [Resources and liabilities given in thousands; i. e., 000 omitted.] Oregon. Utah. Washington. Total. National State National State National State National State banks. banks. banks. banks. banks. banks. banks. banks. Number of banks. 81 178 24 102 78 284 534 1 1,351 Date of report Nov.20 Sept. 11 Nov.20 Oct. 8 Nov.20 Sept. 11 Nov. 20 EESOUBCES. Loans and discounts 171, 737 $46, 868 $30,460 $57,240 $96,599 $76,323 $641,513 $823,062 Stocks, bonds, and other securities , 29,834 11,516 9,764 6,333 44,703 18,297 245,751 264,663 Banking house, furniture, and fixtures, and other real estate 4,526 3,246 1,816 3,413 4,665 9,970 31,177 56,487 Cash and exchange 32, 807 23,693 15,239 15,338 47,332 31, 834 325, 821 246, 847 Other resources 849 782 458 3,097 1,749 13,542 24, 581 61 Total. 139, 753 86,109 57,340 82,783 196,396 138,374 1,269,025 1,415,640 LIABILITIES. Capital 9,591 3,405 7,223 11,810 15,856 90,230 106,975 Surplus and undivided profits 6,717 4,364 2,501 4,322 7,368 8,110 69,368 67,479 Due to banks 13,733 4,210 12,467 4,152 23,448 7,997 196,918 39,234 Individual deposits, demand 76, 647 41,482 24,121 30,247 96,205 59,197 641,303 412,001 Individual deposits, time... 24,462 24,860 9,939 30,007 47,021 54,095 178, 617 742, 578 Rediscount 2 1,082 492 540 518 554 9,109 1,330 Money and bonds borrowed. 1,110 1,176 1,445 1,005 1,157 14,087 3,498 Circulation outstanding 6,142 3,236 61,651 Other liabilities 1,338 631 228 6,742 2,821 2,230 22, 759 32,618 Total., 139, 753 16,109 57,340 82,783 196,396 138,374 1,269,025 1,415,640 1 Includes 134 branch offices. 2 Subtracted from loans and discounts and not included in total liabilities for national banks. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

INDEX. Acceptances: Tage. Acceptance by member banks of drafts and bills, regulation of the Board regarding 168-170 Amounts held by Federal Reserve Banks, distributed by maturities 71 Amounts purchased in the open market each month by Federal Reserve Banks 119,121 Amounts sold by the Boston and New York Federal Reserve Banks to other Federal Reserve Banks during the year 121 List of member banks granted authority to accept drafts and bills up to 100 per cent of capital and surplus 191-193 Advisory Council. (See Federal Advisory Council.) Agricultural paper, discount rates on 39 Amendments to the Federal Reserve Act. (See Federal Reserve Act, amendments to.) Branches, foreign, of national banks authorized 187 Branches of Federal Reserve Banks, amendment to act relating to 23 Bullion, coin, and currency, regulations governing exportation of 21,183-186 Capital stock of Federal Reserve Banks, increase or decrease of, regulations regarding 180 Certificates of indebtedness. (See Treasury certificates of indebtedness.) Charts: Cash reserves and excess reserves of Federal Reserve Banks 68 Federal Reserve notes outstanding and in circulation; also amounts of gold and required paper held by Federal Reserve agents against 49 Gold settlement fund, weekly transactions through 139 Movement of earning assets of Federal Reserve Banks during the year.. 63 Movement of reserves of all Federal Reserve Banks during the year 62 Net deposit and Federal Reserve note liabilities, total reserves, and ratio of total reserves to net deposit and Federal Reserve note liabilities 69 Check clearing and collection system : Effect of amendment to act relating to 23 Nonmember banks allowed privileges of, through amendment to act 12 Operation of 23 Statement showing 140 Regulation of Board regarding 181-183 Transit department disbursements and net service charges of each Federal Reserve Bank. 152 Circulars and regulations of the Board. (See Regulations.) Clayton Act, number of directors, etc., granted authority to serve under Kern amendment to 25 Coin, bullion, and currency, regulations governing exportation of 21,183-186 Collateral notes, amounts of, discounted by Federal Reserve Banks each month 101, J02 Commercial National Bank, Washington, D. C, foreign branches of, authorized 187 609 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

610 INDEX. Commercial paper: Page. Amounts discounted each month by Federal Reserve Banks, distributed by maturities 9G-101 Amounts held by each Federal Reserve Bank on December 28, 1917, distributed by maturities 71 Amounts rediscounted for the Boston Federal Reserve bank during the month of December 101 Bills, including member banks' collateral notes but excluding rediscounts between Federal Reserve Banks, discounted by each Federal Reserve Bank during the year 104-117 Number of member banks accommodated through discount of 118 Regulations of the Board regarding 163-166 Commodity paper: Amounts rediscounted each month by Federal Reserve Banks 103 Discount rates on 40 Credits, unnecessary, curtailment of 2, 9,14-18 Currency, regulations governing exportation of 21,183-186 Directors of Federal Reserve Banks: List of 201-206 Terms of office of 201-206 Directory of Federal Reserve Board and Federal Reserve Banks 201 Discount rates: Changes in, during the year 37-40 Establishment of, in connection with war financing 5, 6, 8,10 High and low, in force from November, 1914, to December 31, 1917 41-43 Districts, Federal Reserve. (See Federal Reserve districts.) Dividends declared by Federal Reserve Banks 28 Earnings and expenses of Federal Reserve Banks 27,145-157 Earning assets of Federal Reserve Banks, chart showing movement of 63 Earnings on investments of Federal Reserve Banks 132 Employees: Federal Reserve Board, salaries of 196,197 Federal Reserve Banks, salaries of 194-196 Examiners of national banks, salaries of 198-200 Executive order regarding exportation of coin, bullion, and currency 183 Expenses of the Federal Reserve Board 34 Expenses of the Federal Reserve Banks 27,145-157 Farm land, regulations of the Beard regarding loans on 175,176 Federal Advisory Council: List of members of 207 Meetings of, with Board during the year 29 Federal Reserve act, amendments to: Branch banks, amendment relating to 23 Check clearing and collection, effect of amendment relating to 23 Effect of the amendments as passed June 21 11 Suggested amendments— Section 4, relating to election of directors of Federal Reserve Banks.. 31 Section 16, permitting issue of Federal Reserve notes in large denominations 32 Section 22, penal section 32 Section 25, to provide for Federal incorporation of banking associations engaged in international and foreign banking 32 Section 25, to provide for the establishment of branches of national banks 33 Sections 5208 and 5209, Revised Statutes, relating to over-certification Digitized for FRASER of checks, embezzlement, etc 33 http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

INDEX, 611 Federal Reserve agents: rage. Conferences of, with Federal Reserve Board 29 Reports of, to Federal Reserve Board. (See Reports of Federal Reserve agents.) Salaries of 194-196 Federal Reserve Banks: Branches of, establishment and operation of, simplified by amendment to act 23 Branches established during the year 25 Capital stock of, regulations regarding 180 Directory of 201-206 Dividends declared by 28 Earnings and expenses of 27,145-157 Earnings on investments 132 Fiscal agents, service rendered by, in connection with Liberty loans.. 3-5, 6-8 Fiscal agent department, disbursements of 153 Franchise tax, amounts paid by 28 Furniture and equipment, cost of 154 Investment operations of 96-132 By classes, by months, and totals for 1917 and 1916 130,131 Officers and directors of, list showing 201-206 Profit and loss account of 150 Resources and liabilities of 60, 64-67, 74-95 Combined, a3 at close of business on last Friday of each month 60-61 On December 31, 1917, consolidated statement of 74-95 Principal, as at close of business on Fridays of each week 64-67 Salaries of officers and employees of 194-196 Service rendered by, as fiscal agents in connection with Liberty loans. . 3-5, 6-8 Transit department disbursements and service charges 152 Treasury certificates, issues of, subscribed by 3 Federal Reserve Board: Conferences with Federal Reserve agents, governors, and advisory council 29 Directory of 201 Discount policy of, in connection with war financing 5-8,10,11 Expenses of 34 Fiduciary powers granted to national banks by 27 Policy of, relating to extension of rediscount privilege on paper not heretofore regarded as eligible 18-20 Receipts and disbursements of 141-144 Regulations governing exportation of coin, bullion, and currency issued by 21,183-186 Reports of Federal Reserve agents to 215-607 Reserve cities designated by, during the year 30 Salaries of officers and employees of 196,197 Staff and expenditures 34 Federal Reserve districts: Counties in divided States 208-213 Description of 208-213 Map showing outline of 214 Population of 208-213 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

612 IKDEX. Federal Reserve notes: Page. Amendment to act regarding, effect of 11 Amounts in hands of Federal Reserve Banks 46,47 Amounts issued by Federal Reserve Banks and in circulation 46,47 Amounts issued to Federal Reserve Banks 44, 47 Amounts outstanding, in circulation, and collateral held by Federal Reserve agents against 47 Chart showing 49 Amounts received from the Comptroller of the Currency by each Federal Reserve Bank 44 By denominations— Issued, retired, and outstanding 51,52 Printed, shipped, and on hand 50 Received by agents, issued to banks, returned for destruction, and on hand.. . 53-57 Chart showing amounts outstanding and in circulation; also amounts of gold and paper held by Federal Reserve agents 49 Cost of, to each Federal Reserve Bank 57 Cost of unissued 155 Eligible paper held by Federal Reserve agents against 45, 47,49 Gold coin and certificates held by Federal Reserve agents against 45,47, 49 Increase in supply of 2 Interdistrict movement of 58 Supply of, placed at subtreasuries 2 Fiduciary powers: List of national banks granted authority to act as executor, administrator, etc 188-190 Number of permits issued during the year for exercising 27 Regulations of the Board regarding granting of 173-174 Supreme Court decision regarding constitutionality of section 11 (k) of the Federal Reserve act 26 First National Bank, Boston, Mass., foreign branch of, authorized 187 Fiscal agents, services rendered by Federal Reserve Banks acting as, in connection with Liberty loans 3-8 Fiscal agent department of each Federal Reserve Bank, disbursements of... 153 Foreign branches of national banks, list of, authorized 187 Foreign countries, shipments of gold to regulations governing 22,183-186 r Foreign exchange rates 22 Furniture and equipment of Federal Reserve Banks, cost of 154 Gold: Amounts held by Federal Reserve agents against Federal Reserve notes. 45,47,49 Amounts held in excess of required reserves, statement showing. 72 Exportation of, regulations governing ..21,183-186 Holdings of Federal Reser\re Banks augmented by amendment to act relating to Federal Reserve note issues 11 Regulations of the Board governing exportation of 183-186 Gold settlement fund: Chart showing weekly transactions through 139 Cost of operating for year 34 Operation of - - 24 Summary of transactions 133-139 Government bonds. (See LTnited States bonds; Liberty bonds.) Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

INDEX. 613 Governors of Federal Reserve Banks: Page. Conferences with Federal Reserve Board 29 Salaries of 194-198 Liberty bonds: Amounts held by Federal Reserve Banks, distributed by classes and maturities 73 Discount rates established in connection with floating of 5, 6, 8,10,11 Discount rates on paper secured by 37, 38 Services rendered by Federal Reserve Banks acting as fiscal agents in floating of 3-5, 6-8 Live-stock paper, discount rates on 39 Map showing outline of Federal Reserve districts 214 Municipal warrants: Amounts held by Federal Reserve Banks, distributed by maturities 72 Amounts purchased each month by Federal Reserve Banks 128 National-bank examiners, salaries of 198-200 National banks: Foreign branches of, authorized 187 List of, granted fiduciary powers during the year 188-190 National City Bank, New York City, foreign branches of, authorized 187 Open-market purchases by Federal Reserve Banks, regulations regarding- .. 166-168 President of the United States: Executive order regarding exportation of coin, bullion, and currency. . 21,183 State banks urged to become members of the system by 9 Population of Federal Reserve districts %. 208-213 Profit and loss account of each Federal Reserve Bank 150 Real estate, loans on, regulations of the Board regarding 175,176 Receipts and disbursements of the Federal Reserve Board 141-144 Regulations of the Federal Reserve Board: Regulation A—Rediscounts under section 13 of the Federal Reserve Act. 163-166 Regulation B—Open-market purchases 166-168 Regulation C—Acceptance by member banks of drafts and bills of exchange 168-170 Regulation D—Time deposits and savings accounts 170 Regulation E—Purchase of warrants 171-173 Regulation F—Trust powers of national banks 173-174 Regulation G—Loans on farm land and other real estate 175-176 Regulation H—Membership of Stats banks and trust companies 176-179 Regulation I—Increase or decrease of capital stock of Federal Reserve Banks 180 Regulation J—Check clearing and collection 181-183 Regulations governing exportation of coin, bullion, and currency 183-186 Reports of Federal Reserve agents: District No. 1—Boston 217-251 Acceptances— Amounts purchased 220, 238 Banks granted permission to accept up to 100 per cent of capital and surplus 241 Bank of England sterling gold account 233 Banking conditions in the district 218 Borrowings of national banks in New England 241 Certificates of indebtedness 229, 246 Check clearing and collection 232,249,250 Credit department 226 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

614 INDEX. Report of Federal Reserve agents—Continued. District No. 1—Boston—Continued. Directors— Page. Election of 231 Meetings of 231 Deposits 227, 243, 215 Discount operations 219. 236, 251 Discount rates 225, 242 Dividends 217, 234 Earnings and expenses 217, 234 Federal Reserve note issues 230, 248, 249 Fiduciary powers granted to national banks 241 Financial results of operation 217 Gold settlement fund operations 233, 250 Government deposits 228, 244, 245 Internal organization of bank 231, 232 Liberty-loan campaigns 229, 247-248 Member banks— Liquidations during the year 240 List of new members .. 240 Number of, in the district 223 Relations with 223 Money rates in Boston 219, 236 Municipal warrants, purchase of 222 Reserves T 222, 239, 242 Resources and liabilities 235 State banks and trust companies— Eligible nonmember banks 241 List of, admitted to the system 240 Relations with 223 United States bonds, investments in 222, 235 War savings stamps 230 District No. 2.—New York 253-306 Acceptances, purchase of 263, 264 Agencies, foreign, designated 299 Bank premises 294 Bankers' acceptances 261, 262 Banking position of the district 295 Business conditions 301 Capital account reconciliation 303 Certificates of indebtedness 265,276 Check clearing and collection 268 Crop conditions 300 Directors, election of 295 Discount operations 257-261 Discount rates 256 Earnings and expenses 254 Employees of the bank 293 Federal Reserve note issues 266, 304 Fiscal agency of the United States 275 Foreign banks, relations with 275, 299 Gold movement 298 Gold settlement fund 270 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

INDEX. &15 Report of Federal Reserve agents—Continued. District No. 2—New York—Continued. Page. Government deposits 291 Imports and exports 301 Investment operations 257-266 Liberty bonds, purchase of 265 Liberty loan campaigns 278-290 Management of the bank 292 Member banks, relations with 271, 272 Money rates 297 Municipal warrants, purchase of 266 Nonmember banks, relations with 273-275 Reserve city designated 271 Resources and liabilities 253 Staff of bank 292-294 State bank membership 271, 273-275 Stock exchange transactions 300 Trade acceptances, increase in use of 264 United States bonds, transactions in 265, 305 War savings and thrift stamps 292 District No. 3—Philadelphia 307-358 Acceptances purchased 325, 326 Acceptances up to 100 per cent 342 Bank clearings 353, 354 Banking conditions in the district 339 Building operations in Philadelphia 357 Business conditions in the district 348-353 Certificates of indebtedness 347 Clearing and collection - 335-337 Commercial failures 355 Crop reports 358 Directors and officers of the bank 333-335 Discount rates 317, 318 Earnings and expenses 312-314 Federal Reserve note issues 329-333 Fiduciary powers granted to member banks 342 Fiscal agency of the United States 344-347 Freight-car movement 356 Government deposits 338 Gold settlement fund 337 Imports and exports 355 Investment operations 318-328 Liberty-loan campaigns 344-348 Member banks of the district, condition of 340 Municipal warrants, purchase of 328 Postal business 358 Relations with member banks 340-343 Reserve position of the bank 316 Resources and liabilities 307 State bank membership 344 Stock-exchange transactions 356 Transit department operations , 335-337 United States bonds, purchase of 326 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

616 INDEX. Beport of Federal Reserve agents—Continued. Page. District No. 4—Cleveland 359-388 Bankers' acceptances 361, 384 Branch banks, establishment of 370-372 Check clearing and collection 373, 388 Directors, election of „.. 372 Discount operations 360, 382 Discount rates 361, 383 Earning assets 376, 380 Earnings and expenses 359, 375, 380 Federal Reserve note issues 369, 379, 387 Fiduciary powers granted to member banks 388 Gold settlement fund 373, 388 Government deposits. 369, 378, 387 Liberty-loan campaigns 364-368, 386 Management of the bank 372 Member banks— Number accommodated through discount of paper..-. 386 Number of, in district 385 Municipal warrants, purchase of 362, 384 Profit and loss account 382 Reserve position of the bank 362, 385 Resources and liabilities 381 Resources of member banks 382 State bank membership 362, 363 Treasury certificates of indebtedness 367, 377, 386 United States bonds, purchase of 362, 384 District No. 5—Richmond 389-411 Bank premises 410 Capital stock, increase in 402 Certificates of indebtedness 389 Check clearing and collection 401 Deposits 396 Directors, election of 409 Discount operations 396-401 Discount rates..: 397 Dividends paid 395, 402 Earnings and expenses 394 Federal Reserve note issues 406-408 Liberty loan campaigns 390,391 Management of the bank 408-410 Member banks, relations with .. 401-403 Profit and loss account 395 Resources and liabilities 393 State bank membership 403-405 United States bonds, transactions in 392 District No. 6—Atlanta. 413-432 Bank quarters and vault facilities 421 Business conditions 414 Capital stock paid in 415, 425 Certi ficates of indebtedness 424 Check clearing and collection 418,430 Directors, election of 421 Discount operations 415,428 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

INDEX. 617 Report of Federal Reserve agents—Continued. District No. 6—Atlanta—Continued. Page. Dividends paid 413, 425, 427 Earnings and expenses 413, 425, 427 Examination of the bank 415 Federal Reserve note issues 417, 429 Liberty loan campaigns 423, 431 Management of the bank 420 Member banks, relations with 414 New Orleans branch 421 Open-market operations 417 Profit and loss account 427 Relations with the public 415-417 Resources and liabilities 413, 426 State-bank membership 419 Transit department operations 430 District No. 7—Chicago 433-454 Branch banks 437 Business conditions 433 Certificates of indebtedness 435,453 Check clearing and collection 438, 440 Directors, election of 436 Discount operations 434 Dividends 439 Earnings and expenses 439, 444 Federal Reserve note issues 438,445 Fiduciary powers granted to members banks 446 Gold settlement fund 445 Liberty loan campaigns 440-442, 450-454 Officers and directors 435, 436 Open-market operations 435 Permits to accept up to 100 per cent 439 Profit and loss account 444 Reserves, fluctuations in 439 Resources and liabilities 443, 444 State bank membership 436, 448 United States bonds purchased 435 District No. 8—St. Louis 455-483 Bank premises 474 Bankers' acceptances purchased 459 Bill-of-lading dralts handled 462 Branch banks 463 Business conditions 456-458 Check clearing and collection 474,483 Directors, election of 473 Discount operations 458, 478 Discount rates 459 Dividends paid 455 Earnings and expenses 455, 476 Federal Reserve note issues 470-472, 481-483 Fiduciary powers granted 463, 479 Government deposits 465 Liberty loan campaign 465-470 Louisville branch bank 463 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

618 INDEX. "Report of Federal Reserve agents—Continued. District No. 8—St. Louis—Continued. Page. Management of bank 472-474 Member banks accommodated through discounts 462 Membership of the district 460 Memphis agency 464 Municipal warrants purchased 459 Officers and directors 473 Profit and loss statement 456,477 Reserve position of the bank 460 Resources and liabilities 455,476 State bank membership 461 Treasury certificates of indebtedness 468, 480 District No. 9—Minneapolis 485-505 Acceptances purchased 491 Agricultural conditions 485 Business conditions 486 Capital stock paid in '. 487 Certificates of indebtedness 500 Check clearing and collection .. 497-500 Deposits, member-bank and Government 488 Directors, election of 504 Discount operations 489-491 Discount rates 489 Earnings and expenses 504 Federal Reserve note issues 493-497 Liberty loan campaigns 501-503 Municipal warrants bought 492 Profit and loss statement 505 Relations with member banks 487 Dividends declared 487 Reserves 488 Resources and liabilities 505 Staff of bank 503 United States bonds held 492 District No. 10—Kansas City 507-534 Acceptances purchased 527 Certificates of indebtedness 515 Check clearing and collection 520-521, 532, 533 Denver branch 520 Deposits by member banks 529, 530 Directors, election of 518 Denver branch 520 Omaha branch 519 Discount operations for the year 508, 526-528 Discount rates 527 Dividends paid 507, 524 Earnings and expenses 507, 523, 524 Federal Reserve note issues 515-517, 530-532 Investment operations 508, 526-528 Liberty loan campaigns 512-515 Management of bank 517 Member banks in district 509 Officers and staff 518,532 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

INDEX. 619 Report of Federal Reserve agents—Continued. District No. 10—Kansas City—Continued. Page. Omaha branch bank 519 Profit and loss statement 523, 524 Public relations 511 Reserves 530 Reserve position of the bank 529 Resources and liabilities 524 State bank membership 509, 510 United States bonds purchased 528 Warrants purchased 527 District No. 11—Dallas 535-571 Acceptances purchased 539, 559 Bank premises 550 Business conditions in the district 536-538 Certificates of indebtedness 569-571 Check clearing and collection 550-553, 567 Currency and coin shipped 553, 568 Deposits by member banks 542, 562 Directors, election of 548, 549 Discount operations 538, 557 Discount rates 558 Dividends paid . 535 Earnings and expenses 535,556, 557 Examination of bank 550 Federal Reserve note issues 545,563-567 Gold settlement fund 553, 568 Government deposits 544, 562 Liberty loan campaigns 553-555, 569-571 Management of bank 548 Member banks, number of, in the district 540 Municipal warrants purchased 560 Officers and staff of bank 548, 549 Relations with member banks 541 Relations with the public 543 Reserve position of bank 540, 561 Resources and liabilities 535, 556 State bank membership 541 United States bonds, operation in 539, 559, 560 District No. 12—San Francisco 573-607 Acceptances bought 576, 581 Bank failures within the district 579 Bank premises 596 Branch banks 580, 581 Branches, officers and directors of 602 Business conditions 598-600 Certificates of indebtedness ... 601 a Check clearing and collection 596-598 Deposits by member banks 579 Directors- Election of 594 List of 602 Discount operations .......„, 575,600 34365°—18 40 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

620 INDEX. Report of Federal Reserve agent;-—Continued. District No. 12—San Francisco—Continued. Page. Discount rates 575, 582 Dividends paid ; 574 Earnings and expenses 574 Federal Reserve note issues 591-593 Government deposits 583 Liberty loan campaigns 583-591 Management of bank 594-596 Member banks accommodated through discounts 579 Member banks in district, number of 577 Municipal warrants purchased 576 National banks in district, condition of 602-604 Officers and staff 594, 602 Relations with the public .' 581, 582 Reserve position of the bank 601 Resources and liabilities 573 State bank membership 577, 578 Trade acceptances 575 United States bond operations : 576 Reserve cities: Designated by Federal Reserve Board during the year 30 Discussion of existing law regarding 30 Reserves: Cash reserves and excess reserves of Federal Reserve Banks 68 Changes in, as required by amendment to the act 12 Chart showing movement of reserves of Federal Reserve Banks 62 Chart showing net deposit and Federal Reserve note liabilities, total reserves, and ratio of total reserves to net deposit and Federal Reserve note liabilities 69 Required reserves against net deposit and Federal Reserve note liabilities and amounts of gold held in excess of required reserves 70 Statement showing changes in reserve position of the Federal Reserve system during the year 15 Resources and liabilities of Federal Reserve Banks 60, 61, 64-67, 74-95 Combined, as at close of business each month 60, 61 On December 31, 1917, consolidated statement 74-95 Principal, at close of business each Friday 64-67 Salaries: National-bank examiners 198-200 Officers and employees of Federal Reserve Banks 194-196 Officers and employees of the Federal Reserve Board 196,197 Secretary of the Treasury, acknowledgment by, of services rendered by Federal Reserve Banks as fiscal agents in Liberty loan campaign 4 State banks and trust companies: Amendment to act regarding membership of, effect of 13 List of, members of the system 158-162 Membership of, in system 14 Regulations of the Board regarding 176-179 Statement of President of the United States regarding 9 Total capital, surplus, and resources of State member banks 14 Sub treasuries, supply of Federal Reserve notes placed at 2 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

INDEX. 621 Page. Supreme Court of the United States, decision of, regarding constitutionality of section 11 (k) of the Federal Reserve Act 26 Tax, franchise, paid by Federal Reserve Banks to the Government 28 Time deposits and savings accounts, regulations of the Board regarding 170 Trade acceptances: Amounts discounted by Federal Reserve Banks each month 102 Discount rates on 39 Transit departments of Federal Reserve Banks, disbursements of 152 Treasury certificates of indebtedness: Amounts held by Federal Reserve Banks, distributed by classes and maturities 73 Discount rates on paper secured by 5,10, 37, 38 Subscriptions to, by Federal Reserve Banks 3 Treasury notes, one-year: Amounts held on January 1, 1918 124 Amounts purchased by Federal Reserve Banks during the year 122,124 Amounts sold during the year by Federal Reserve Banks 123,124 Trust companies. (See State banks and trust companies.) Trust powers. (See Fiduciary powers.) United States bonds: Amounts held by Federal Reserve Banks on January 1,1918 124 Amounts held by Federal Reserve Banks, distributed by classes and maturites 72, 73 Amounts originally allotted by Federal Reserve Board and actual amounts converted 127 Amounts purchased by Federal Reserve Banks during the year 122,124 Amounts sold by Federal Reserve Banks during the year 123,124 Conversion operations of each Federal Reserve Bank during year 124 Discount rates, establishment of. in connection with Liberty bonds... 6, 8,10,11 Refunding operations in 1917 125,126 See also Liberty bonds. United States certificates of indebtedness: Amounts held by Federal Reserve Banks, distributed by classes and maturities 73 Discount rates on paper secured by 5,10, 37, 38 Subscriptions to. by Federal Reserve Banks 3 Warrants, municipal: Amounts held by Federal Reserve Banks, distributed by maturities 72 Amounts purchased each month by Federal Reserve Banks 128 Curtailment in purchase of, recommended 2 Regulations of the Board regarding purchase of 171-173 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

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