Annual Report of the Federal Reserve Board, 1918

FIFTH ANNUAL REPORT OF THE FEDERAL RESERVE BOARD COVERING OPERATIONS FOR THE YEAR 1918 WASHINGTON GOVERNlffiNT PRINTING OFFICE 1919 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

TABLE OF CONTENTS. Page. PART I.—Report of the Federal Reserve Board, with exhibits 1-266 PART II.—Report of Federal Reserve Agents to the Federal Reserve Board 267-760 PART III.—Recommendations of the Federal Advisory Council to the Federal Reserve Board for years 1915-1918 761-870 PART I. Text of report: Fiscal agency operations 1 Rediscount operations and sales between Federal Reserve Banks 3 Discount policy of the Federal Reserve Board 4 Changes in discount rates 5 Movement of principal assets and liabilities of all Federal Reserve Banks 8 Reserve position of the Federal Reserve Banks 13 Effect of war financing upon the Federal Reserve Banks 14 Acceptances 18 Membership of State institutions 24 Rates of earnings from investments of the Federal Reserve Banks 27 Earnings and expenses of the Federal Reserve Banks 28 Banking quarters 30 Gold settlement fund 32 Proposed international gold fund 1 35 Export of coin, bullion, and currency 35 Regulation and control of foreign exchange 39 Division of Foreign Exchange 46 Foreign branches of American banks 59 Division of Analysis and Research 62 Capital Issues Committee 64 Law Division 66 Fiduciary powers granted to national banks 71 Reserve and central reserve cities 72 Branches of Federal Reserve Banks 72 Check clearing and collection 74 Federal Reserve bank notes 77 Amendments to the Federal Reserve Act 79 Pending 81 Meetings of the Federal Advisory Council 84 Organization, staff, and expenditures of the Federal Reserve Board 84 Conclusion 85 EXHIBITS. Exhibit A—Discount rates 91 Exhibit B—Federal Reserve notes 94 Exhibit C—Statement of condition of Federal Reserve Banks 117 Exhibit D—Investment operations of Federal Reserve Banks 154 Exhibit E—Gold settlement fund 195 Exhibit F—Clearing operations 204 in Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

IV CONTENTS. Page. Exhibit G—Certificates of indebtedness 207 Exhibit H—Earnings and expenses of the Federal Reserve Banks 209 Exhibit I—Receipts and disbursements of the Federal Reserve Board 216 Exhibit J—State banks and trust companies admitted to membership 218 Exhibit K—Foreign branches authorized 234 Exhibit L—Fiduciary powers granted to national banks 235 Exhibit M—Banks granted authority to accept up to 100 per cent of capi tal and surplus 240 Exhibit N—Personnel and salaries: Salaries of officers and employees of Federal Reserve Banks 244 Salaries of officers and employees of Federal Reserve Board 247 Salaries of bank examiners 250 Exhibit O—Directory of the Federal Reserve Board and Federal Reserve Banks 253 Exhibit P—Federal Advisory Council . _ 259 Exhibit Q—Exports of coin, bullion, and currency 260 Exhibit R—Amendments to the Federal Reserve Act 261 CHABTS. Federal Reserve notes in circulation and per cent of gold cover therefor__ 101 Movement of earning assets of all Federal Reserve Banks 123 Deposit and note liabilities, also cash reserves of all Federal Reserve Banks - 126 Total cash reserves and excess reserves of all Federal Reserve Banks 127 War paper and total bills discounted by all Federal Reserve Banks and The Federal Reserve Banks of New York during 1918 169 Operations through the gold settlement fund 198 PART II. Reports of Federal Reserve agents to the Federal Reserve Board 267-760 District No. 1—Boston 269-515 District No. 2—New York 317-398 District No. 3—Philadelphia 399-450 District No. 4—Cleveland- 451-481 District No. 5—Richmond 483-509 District No. 6—Atlanta 1 511-538 District No. 7—Chicago 539-580 District No. 8—St. Louis 581-622 District No. 9—Minneapolis __-.___ 623-651 District No. 10—Kansas City 653-686 District No. 11—Dallas. 687-728 District No. 12—San Francisco 729-760 PART III. Recommendations of the Federal Advisory Council 761-870 1915- 761-789 1916. 790-823 1917. 824-851 1918, 852-870 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

PART I. REPORT OF THE FEDERAL RESERVE BOARD, WITH EXHIBITS. V Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

AMUAL REPORT OF THE FEDERAL RESERVE BOARD. FEDERAL RESERVE BOARD, Washington, January 31,1919. SIR : In compliance with the requirements of section 10 of the Fed eral Reserve Act, the Federal Reserve Board submits herewith its fifth annual report covering operations for the calendar year ended December 31, 1918. FISCAL AGENCY OPERATIONS. War financing has been the dominant feature of the year. Gov ernment requirements have been larger than ever, and the vast op erations of the Treasury have been reflected in the work and activities of the Federal Reserve Banks. These banks have handled all details connected with the sales and allotments of Treasury certificates of indebtedness among member and nonmember banks of their respec tive districts, have received subscriptions to Liberty bond issues, col lected all bond and certificate payments and redeposited the funds with depositary banks, withdrawing them as required by the Treas ury, and have made deliveries of Government bonds and Treasury certificates to subscribers. They have also attended to the exchange and conversion of bonds for member and nonmember banks and for the public. The Secretary of the Treasury has continued the policy of using the Federal Reserve Banks as agencies for negotiating all Govern ment loans, and the work of the banks in performing this function has been even heavier than before. Under the general direction of the Secretary of the Treasur}^ the work of the Liberty loan commit tees in the selling campaigns throughout the various districts has been supervised by the governors and other officers of the Federal Reserve Banks. By means of interdistrict settlements through the gold settlement fund, maintained at Washington by the Federal Reserve Board for the banks, it has been possible for the Treasury to leave funds with designated depositary banks throughout the country until actually required, transfers being made by telegraph to Federal Reserve Banks in cities where the Government's disbursements are made. These vast operations have been conducted without any strain upon or disturbance of the money market. 100823°—19 1 1 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

2 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. A total of $11,117,936,400 of bonds of the third and fourth Liberty loans, and $10,660,743,000 of Treasury certificates of indebtedness issued in anticipation of these loans, of the forthcoming fifth loan, and of 1918 and 1919 tax receipts have been subscribed, allotted and collected through the 12 Federal Reserve Banks. A detailed statement of these operations is given in the subjoined table: Allotments of Liberty bonds and Treasury certificates from Jan. 1 to Dec. 31, 1918. Liberty bonds. Third loan. Fourth loan. Total allotments. $354,537,250 $632,124,850 $986,662,100 1,115,243,650 2,044,931,750 3,160,175,400 Philadelphia 361,963,500 598,763,650 960,727,150 405,051,150 701,909,800 1,106,960,950 Richmond 186,259,050 352,685,200 538,944,250 Atlanta 137,649,450 218,086,550 355,736,000 Chicago 608,878,600 989,209,000 1,578,087,600 St. Louis 199,835,900 ! 295,298,800 495,134,700 180,892,100 242,046,050 422,938,150 Kansas City 204,092,800 295,951,450 500,044,250 Dallas 116,220,650 146,080,200 262,300,850 San Francisco 287,975,000 462,250,000 750,225,000 Total 4,158,599,100 6,959,337,300 11,117,936,400 Certif icates of indebte dness. In anticii >ation of— Total Treas ury certificate Third loan. Fourth loan. Fifth loan. Tax pay allotments. ments. Boston $214,417,000 $381,152,500 $92,911,500 $163,092,500 $851,573,500 New York 1,255,308,000 1,680,989,000 421,947,000 733,016,000 4,091,260,000 Philadelphia 196,500,000 316,020,000 84,537,500 123,852,000 720,909,500 Cleveland 233,033,500 440,569,000 102,700,000 312,690,500 1,093,993,000 Richmond 75,829,500 117,983,500 38,515,500 35,070,000 267,398,500 Atlanta 79,573,000 114,857,000 27,949,500 26,350,000 248,729,500 Chicago 325,355,000 663,204,000 180,425,000 258,625,500 1,427,609,500 St. Louis 133,584,500 186,963,000 45,551,000 40,691,500 406,790,000 Minneapolis 89,350,000 127,560,000 46,765,000 21,704,500 285,379,500 Kansas City 128,524,500 176,866,000 41,893,500 31,070,500 378,354,500 Dallas 90,925,000 83,320,000 16,196,500 39,838,000 230,279,500 San Francisco 172,790,500 305,020,000 82,400,000 i 98,255,500 658,466,000 Total 3,000,190,500 4,594,504,000 1,181,792,000 2 1,834,256,500 10,660,743,000 1 Exclusive of $251,030 of the Nov. 30,1917, issue allotted on Jan. 23,1918. 2 Includes 76 millions 4 per cent certificates of the Aug. 2 J issue received in payment for the 4| per cent issue of Nov. 7. NOTE.—Above figures are exclusive of $104,707,000 of 2 per cent 1-year certificates sold to Federal Re serve Banks to secure bank-notecirculation, and of special temporary certificates sold to Federal Reserve Banks, none of which are now outstanding. Including operations in 1917, certificates of indebtedness and Lib erty bonds subscribed for and collected through the Federal Reserve Banks have amounted to $31,457,310,400 composed of $14,530,708,000 of certificates and $16,926,602,400 of Liberty bonds. The Treasury balances carried with the Federal Reserve Banks and the member banks in the various districts have been subject to wide fluctuations, owing mainly to the constantly changing require ments of the Treasury, and partly to the seasonal character of col- Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

ANNUAL REPORT OF THE FEDERAL, RESERVE BOARD. 3 lections of internal-revenue taxes made for the Treasury's account. The average of the Friday night balances standing to the credit of thb Treasury on the books of the 12 Federal Reserve Banks for the year were as follows: Federal Reserve Bank: Boston $13, 431, 000 New York 19, 206, 000 Philadelphia 10, 570, 000 Cleveland 17, 324, 000 Richmond 6, 409,' 000 Atlanta 8, 010, 000 Chicago 16, 034, 000 St. Louis 10, 532, 000 Minneapolis 7, 830, 000 Kansas City 9, 668, 000 Dallas 7, 060, 000 San Francisco 12,100, 000 REDISCOUNT OPERATIONS AND SALES BETWEEN FEDERAL, RESERVE BANKS. Section 11 of the Federal reserve act provides that the Federal Reserve Board may permit or, on the affirmative vote of at least five members of the Federal Reserve Board, require Federal Reserve Banks to rediscount the discounted paper of other Federal Reserve Banks at rates of interest to be fixed by the Federal Reserve Board. Transactions of this character between the Federal Reserve Banks have been unusually heavy during the past year, due to three causes named in the order of their importance: First, transfers of Govern ment funds; second, joint purchases of bankers' acceptances; and third, seasonal requirements incident to crop moving. The Board's policy has been to equalize, in an approximate degree, the reserves of the 12 Federal Reserve Banks with the purpose of avoiding undue variations in their reserve position. Discount trans actions between the banks have not, as a rule, been negotiated by the banks themselves, but through the medium of the Federal Reserve Board, instructions being given by telegraph, and transfers incident to the operations were effected in the same way. Open-market purchases of bankers' acceptances have shown a very substantial growth. Investments in paper of this class reached a maximum of $388,383,000 on October 25. The principal market for acceptances is New York, although an open market for them has been established in Boston under the auspices of the Federal Re serve Bank there. The Federal Reserve Banks of other districts have found it more convenient to participate in the purchases of acceptances made by the Federal Reserve Bank of New York, and some of the banks have undertaken to take care of the acceptances originating in their own districts which are sold in the New York market. Voluntary transactions between the banks in acceptances Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. have been permitted without the indorsement of the Federal Re serve Bank selling them, but in all cases where the Board has re quired rediscount operations the indorsement of the bank disposing of the paper has been given. Rediscounting because of seasonal or crop-moving requirements has-been confined to five banks—the Federal Reserve Banks of Kan sas City, Minneapolis, Dallas, Atlanta, and Richmond—but it is • probable that none of these banks would have had occasion to redis count except for the fact that they were discounting heavily for member banks paper secured by Government obligations. Transac tions in paper of this class have been so heavy and transfers of balances from one district to another so constant that the process of rediscounting between banks has been continuous through the greater part of the year. All of the banks have disposed of paper except the Federal Re serve Banks of Cleveland and San Francisco. Rediscount opera tions between the Federal Reserve Banks, including voluntary pur chases of bankers' acceptances, during the year, have aggregated $660,638,000, as shown in detail in the following table : Interdistrict movement of bills discounted or purchased by Federal Reserve Banks during the period from Jan. 1 to Dec. 31, 1918. [In thousands of dollars.] Acceptances Direct purchased for purchases of Interdistrict Rediscounts and sales between account of acceptances in movement of Federal Reserve Banks. other Federal other Federal discounted and Reserve Reserve purchased Banks. districts. paper. Federal Reserve Bank. c o R o b r u e y s n d — o t i l e s d - d c o c o r b h D u y a p n i — s s u t e e r d d o E c s f o x a a r u e n l c e n d d e s i t s . s s s - E c c o o p h x f a u u a c n d n s d r e i e s t s s s s . A c m b h p y a u o — s r u e n d t A c f c m o p h o o r f a u o — u s r a u n e c n t d t M c w h p a h a i u n r i s r k c e h e d t . c b h P a a u n s r i k n . g E f m r m x o o e c m v e n — e t s s E m m t x o o e c — v n e e t s s Boston 120,297 19,898 100,399 1,907 2,057 8,503 92,046 New York 180,901 67,681 113,220 174,860 41,411 329,491 50,149 66,365 16,216 18, 949 21,397 56,562 Cleveland 137,115 137,115 65,628 4,791 207,534 Richmond 69,063 331 68, 732 68,732 Atlanta 80,293 2, 514 77,779 57 77,722 Chicago 9, 984 200, 398 190,414 1,093 3,685 195,192 St Louis 12, 500 9,051 2,770 679 Minneapolis 24,996 99,462 3,449 74,466 6,384 2,057 82,907 Kansas City 8,530 25,047 16,517 111 047 27,564 Dallas 103,925 8,242 1,283 265 94,135 -San Francisco 24,534 95,683 24,534 68,512 9§,046 Total 660,638 660,638 459,262 459,262 174,860 174,860 43,468 43,468 662,805 662,805 DISCOUNT POLICY. The discount policy of the Board has necessarily been coordinated throughout the year with Treasury requirements and policies, which in turn have been governed by demands made upon the Treasury for war purposes. All lines of business activity have been subordinated to war necessities; more than two million men have been under arms Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. 5 in France, another million at stations and training camps in this country, half a million more were in the Navy, making more than three and a half million men actually under arms; and it is esti mated that the labor of fifteen million more has been devoted to the production, manufacture, and distribution of commodities and ma terial required in the conduct of the war. The Government has^een the principal purchaser and consumer of goods, as well as the chief employer of labor, and the financing of the Government therefore has been of paramount importance from a commercial as well as a patriotic point of view. The rates of interest borne by the Treasury certificates of indebted ness and by the Liberty loan bonds have been determined by the Sec retary of the Treasury within the limits fixed by Congress, and the Board has felt it to be its duty to adjust its discount rates in such manner as to assist the distribution of the various Treasury issues. The Board has therefore continued the policy, as explained in the last annual report, of giving a preferential rate of discount to notes made or offered by member banks secured by the Government's war obligations, and has continued to permit the Federal Reserve Banks to discount for nonmember banks, upon the indorsement of a member bank, notes secured in this manner. The coupon rate of the Liberty loan bonds of the third and fourth issues is 4J per cent, against 3J per cent for the first loan and 4 per cent for the second, and the interest rate on certificates of indebted ness was advanced during the year to 4-J- per cent, against rates of 3 to 4 per cent during 1917. The Board thereupon approved an appreciable increase in discount rates at all Federal Reserve Banks, the principal changes having beer made on April 8, shortly before subscriptions closed to the third Liberty loan. While a preferential has been maintained in favor of paper secured by Government obligations, corresponding changes have been made in the rates for commercial paper of various maturi ties, all of which are shown in the following tables: Changes in rates of discount for 15-day commercial paper, including collateral notes. Effective— Federal Reserve Bank. Jan. 1, Apr. 3, Apr. 8, May 20, Aug. 29, Sept. 3, Sent. 5, Sept. 10, Dec. 30, 1918. 1918. 1918. 1918. 1918. 1918. 1918. 1918. 1918. Boston 4 New Yor;: 3\ 4 Philadelphia 4 Cleveland 4 Richmond . 4 4| 4 Atlanta 4 41 Chicago 4 St. Louis 4 4 4i Kansas City 4 4| Dallas 4 U San Francisco 4 4| ! Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

6 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. Changes in rates of discount on 15-day paper, secured by United States war obligations, including collateral notes. Effective- Federal Reserve Bank. Jan. 1, Apr. 3, Apr. 8, Apr. 15, May 20, Aug. 29, 1918. 1918. 1918. 1918. 1918. 1918. Boston • 3'; 4 Now York 31 4 Philadelphia 3* 4 Cleveland 31 4 Richmond 31 4 lH Atlanta 31 4 Chicago 31 4 St. Louis # • 31 4 Minneapolis 31 4 Kansas City 31 4 l*t Dallas 31 4 San Francisco 3i 4 4i 1 Four per cent rate on paper secured by fourth Liberty bonds when taken by rediscounting bank at rate not exceeding coupon rate. Changes in discount rates on paper maturing within 16 to 90 days, secured by United States war obligations. Effective- Effective— Federal Reserve Federal Reserve Bank. Jan, l, Apr. 3, Apr. 8, Apr. 15, Bank. Jan. 1, Apr. 3, Apr. 8, Apr. 15, 1918. 1918. 1918. 1918. 1918. 1918. 1918. 1918. 4 41 Chicago 4 41 4 41 St. Louis 4 41 Philadelphia 4 4i Minneapolis 4 41 Cleveland 4 41 Kansas City 4 41 Richmond 4 41 Dallas 4 41 Atlanta 4 41 San Francisco... 4 4:1 Rates on paper secured by fourth Liberty bonds when taken by rediscounting bank at rate not exceed ing coupon rate: 4 per cent, Boston, effective Oct. 1; Kansas City, Oct. 1; Chicago, Oct. 2; Atlanta, Oct- 7; St. Louis, Oct. 8; Richmond, Oct. 19. Changes in discount rates on commercial paper maturing within 16 to 60 days. Effective- Federal Reserve Bank. Jan. 1, Apr. 3, Apr 8, Apr. 15, May 20, Aug. 29, Sept. 20, Dec. 30, 1918. 1918. 1918. 1918. 1918. 1918. 1918. 1918. Boston 5 41 New York 4-i 42 Philadelphia Ah 4| Cleveland 4\ 4f Richmond 41 41 5 41 Atlanta 41 41 Chicago i\ 41 St. Louis 4-i 41 Minneapolis 41 41 Kansas City 41 4.3. 51 5 Dallas 4h 45 San Francisco U 41 5 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. 7 Changes in discount rates on commercial paper maturing ivithin 61 to 90 days. Effective- Federal Reserve Bank. Jan. 1, Apr. 3, Apr. 8, Apr. 15, May 20, July 15, Am?. 29, Sept. 20, Dec. 30, 1918. 1918. 1918. 1918. 1918. 1918. 1918. 1918. 1918. Boston 5 4| New York 41 4| Philadelphia 41 4f Cleveland 41 4f Richmond 41 41 5 4| Atlanta 4i 4f Chicago 5 4f St. Louis 4| Minneapolis 5 Kansas City 41 4f 5| 5 Dallas 41 5 San Francisco 41 4| 5 Changes in discount rates on agricultural and live-stock paper maturing within 91 to 180 days. Effective— Federal Reserve Bank. Jan. 1, Apr. 8, Apr. 15, May 20, Dec. 30, 1918. 1918. 1918. 1918. 1918. Boston 5 New York 5 Philadelphia 5 Cleveland 5 5i Richmond 41 5 5i 5 Atlanta 5 Chicago 51 St. Louis 51 51 Kansas City 5 51 Dallas 5 5i San Francisco 51 Changes in discount rates in trade acceptances maturing within 1 to 60 days. Effective- Federal Reserve Bank. Jan. 1, Apr. 3, Apr. 8, Apr. 15, May 20, Aug. 29, Dec. 30, 1918. 1918. 1918. 1918. 1918. 1918. 1918. Boston 4 41 New York 4 41 Philadelphia 4 41 Cleveland 4 41 Richmond 4 41 !4| 4-1 Atlanta . . 4 41 Chicago 31 41 St. Louis 4 41 Minneapolis 31 41 ! K Da a l n l s as a s City . .. 4 41 41 4f San Francisco 31 41 43- 4 * 1 41 per cent for trade acceptances maturing within 15 days. NOTE.—In case the 60-day trade acceptance rate is higher than the 15-day discount rate, trade accept ances maturing within 15 days will be taken at the lower rate. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

8 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. Changes in discount rates on trade acceptances maturing within 61 to 90 days. Effective— Federal Reserve Bank. Jan. 1, Apr. 3, Apr. 8, Apr. 15, May 20, Aug. 29, Dec. 30, 1918. 1918. 1918. 1918. 1918. 1918. 1918. Boston 4 4i New York 4 ^4i Philadelphia ^ 4 4* Cleveland. i 4 4* Richmond 4 4* 41 4* Atlanta 4 4* Chicago 4 4* St. Louis 4 4* Minneapolis 4 4J Kansas City 4 4| 4f Dallas 4 4 San Francisco 4 4 4| Changes in open-market rates on bankers' acceptances maturing within 3 months. Effective- Federal Reserve Bank. Jan. 1, Apr. 3, Apr. 8, Apr. 15, 1918. 1918.1 1918.1 1918.1 3-5 4 New York 2 3-4* 4 Philadelphia 3-4* 4 Cleveland 3-4* 4 Richmond 3-4* 4 Atlanta " 3-4* 4 3-5 4 3-4* 4 Minneapolis • 3-5 4 3-4* 4 Dallas 3-4* 4 3-4* 4 1 Minimum rate. 2 Rates for discounted bankers' acceptances maturing within 15 days, 4 per cent; within 16 to 60 days, 4i per cent; and within 61 to 90 days, 4* per cent. MOVEMENT OF PRINCIPAL ASSETS AND LIABILITIES OF FEDERAL RESERVE BANKS DURING THE CALENDAR YEAR 1918. Owing to the issue during the year of Government obligations greatly in excess of the estimated normal annual savings of the coun try, there has been a marked increase in the loans and deposits of member and nonmember banks, which is reflected in the net total of bills discounted and bought by the Federal Eeserve Banks, in their net deposits, and in their outstanding issues of Federal Eeserve notes: and as a result of the Board's policy of giving a preferential rate of discount on paper secured by United States bonds and Treas ury certificates, the Federal Eeserve Banks' holdings of paper se cured by war obligations of the Government have increased out of all proportion to their commercial paper holdings. The whole situa tion is depicted in the following table, which shows the changes, week by week, throughout the year of loans, reserves, note issues and deposits: Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Movement of principal assets and liabilities of all Federal Reserve Banks during the calendar year 1918. [In thousands of dollars.] 9 10 Bis- Ratio of counted cash paper, Federal reserves Federal G se m o c v e u e n r r e t n d dis p O c a o t p h u e e n r r t . ed m i b n o B a u o r i k l g p l e s h e n t t . d T i b o s o c t a a o u n l u g d b n h i t t l . e l d s P ( e l r t o c 4 en ). t re T s c e o a r s t v h a e l s. dep N o e s t its. R n c a o i e c r t s c t e e u u s r a l v a l i n e de R F p to e e o s d s n e e it r e r v t a a e l n d| n R c o i B e r t s c a e e s u n r l k v a i n e war tion. note tion, net obliga liabilities liability. tions. combined. 1918. Jan 4 285,919 339,894 271,338 .897,151 31.9 1,733,030 1,446,228 1,251,205 64.2 8,000 11 277,014 293,651 258,710 T29,375 33.4 1,748,031 1,444,904 1,242,199 65.1 8,000 18 300,268 303,220 257,804 861,292 34.9 1,784,307 1,496,386 1,238,797 65.2 8,000 25 312,520 315,142 273,912 901,574 34.7 1,782,759 1,492,878 1,234,934 65.4 8,000 Feb. 1 305,664 301,114 289,805 896,583 34.1 1,775,457 1,488,036 1,236,101 65.2 8,000 8 269,302 255,819 280,705 805,826 33.4 1,813,094 1,502,853 1,261,219 65.6 8,000 15 249,603 252,313 287,263 789,179 31.6 1,818,736 1,403,634 1,281,045 67.7 7,999 21 263,905 245,629 296,170 805,704 32.8 1,832,524 1,462,627 1,314,581 66.0 7,999 Mar. 1 249,195 253,330 299,213 801,738 31.1 1,837,773 1,439,887 1,351,091 65.8 7,999 8 264,501 255,839 317,952 838,292 31.6 1,847,883 1,472,439 1,383,990 64.7 8,000 15 257,621 259,863 323,248 840,732 30.6 1,852,193 1,464,519 1,406,228 64.5 8,000 22 282,962 260,157 328,880 871,999 32.4 1,862,372 1,505,774 1,429,509 63.4 7,978 28-29 301,451 281,777 304,065 887,293 34.0 1,874,063 1,535,367 1,452,838 62.7 7,978 Apr. 5 304,075 269,808 326,503 900,386 33.8 1,877,433 1,529,364 1.479,920 62.4 7,860 12 465,625 247,182 318,857 1,031,664 45.1 1,894,995 1,533,827 1,499,377 62.5 8,000 19 564,724 243,321 308,277 1,116,322 50.6 1,898,307 1,502,246 1,514,287 62.9 7,895 26 642,429 259,314 302,844 1,204,587 53.3 1,890,945 1,556,303 1,526,232 61.3 7,895 May 3... 606,630 266,812 297,029 1,170,471 51.8 1,919,983 1,520,957 1,556,680 62.4 7,980 10 612,324 326,717 286,036 1,225,077 50.0 1,942,500 1,651,324 1,569,618 60.3 7,878 17 526,163 316,102 279,886 1,122,151 46.9 1,952,712 1,524,453 1,569,445 63.1 7,878 24 600,499 322,800 278,221 1,201,520 50.0 1,956,056 1,557,618 1,578,621 62.4 7,864 31 562,993 334,364 256,373 1,153,730 48.8 1,975,709 1,586,608 1,600.968 62.0 8,324 June 7 627,025 357,467 248,542 1,233,034 50.9 1,977,724 1,576,364 1,639,579 61.5 19,580 14 653,863 362,168 242,923 1,258,954 51.9 2,005,263 1,588,771 1,651,500 61.9 0,001 21 544,193 387,077 232,472 1,163,742 46.8 1,981,111 1,445,403 1,677,951 63.4 9,945 28 434,509 434,666 216,848 1,086,023 40.0 2,006,199 1,529,819 1,722,216 61.7 10,390 July 5 563,496 513,286 211,947 1,288,729 43.7 2,015,163 1,473,927 1,791,569 61.7 10,335 12 606,599 553,283 218,464 1,378,346 44.0 2,015,984 1,553,664 1,813,425 59.9 10,600 19 601,403 601,943 205,932 1,409,278 42.7 2,031,095 1,566,680 1,829; 045 59.8 11,000 26 673,231 628,920 205,274 1,507,425 44.7 2,029,329 1,622,870 1,870,835 58.1 11,084 QO Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Movement of principal assets and liabilities of all Federal Reserve Banks during the calendar year 1918—Continued. [In thousands of dollars.] 1 2 3 4 5 6 7 8 9 10 Dis Ratio of counted cash paper, Federal reserves Federal s G e m o c b v e u y e n r r e t n d - , dis p O c a o t p h u e e n r r t . ed m b in o B a u o r i k l p g l e s e h n t t . d T i b o s o c t a a o u n l u g d b n n i t t l . e l d s P (l er t o c 4 e ) n . t re T s c e o a r t s v a h e l s. dep N o e s t its. R n c a o i e r c t s c t e e u u s r l a v a l i n e de R F p t e e o o d s s e n e it r r e v a t a e l n d R n ci o B e r t s c a e e u s n r l k v a i n e war tion. note tion, net obliga liabilities liability. o tions. combined. W H 1918. Aug. 2 685,921 584,998 209,185 1,480,104 46.3 2,034,918 1,558,839 1,906,465 58.7 11,479 O 9 761,576 570,897 208,557 1,541,030 49.4 2,044,523 1,576,322 1,955,276 57.9 13,716 2 1 3 6 7 8 5 5 2 3 , , 1 5 1 0 5 8 5 5 4 3 0 3 , , 2 2 4 5 7 3 2 2 1 3 2 6 , , 2 5 0 6 4 6 1 1 , , 4 6 9 3 7 0 , , 5 3 7 2 2 1 5 5 0 2 . . 2 4 2 2, , 0 0 5 4 5 5 , , 2 5 6 2 6 3 1 1 , , 5 5 1 9 2 4 , , 5 0 0 6 7 8 2 1 , , 0 9 3 8 2 5 , , 8 4 3 1 7 9 5 5 8 6 . . 5 7 1 1 5 6 , , 1 8 6 6 7 4 H 30 896,228 531,967 232,603 1,660,798 54.0 2,066,962 •1,572,898 2,092,708 56.4 20,687 w Sept. 6 1,007,366 534,608 233,766 1,775,740 56.7 2,070,494 1,601,650 2,180,679 54.7 23,964 13 1,071,304 541,943 239,750 1,852,997 57.8 2,077,732 1,622,165 2,245,429 53.7 27,672 20 1,146,357 513,789 250,032 1,910,178 60.0 2,076,039 1,629,264 2,295,031 52.9 33,208 o 27 1,221,533 491,897 288,391 2,001,821 61.0 2,072,176 1,667,109 2,349,326 51.6 35,819 a Oct. 4 1,251,787 454,419 310,817 2,017,023 62.1 2,077,371 1,606,262 2,431,004 51.5 40,305 10 1,304,383 450,086 338,620 2,093,089 62.3 2,083,358 1,638,159 2,478,378 50.6 52,031 18 1,262,757 425,799 370,136 2,058,692 61.3 2,087,685 1,580,802 2,502,488 51.1 55,666 25 1,092,417 453,747 398,623 1,944,787 56.2 2,098,169 1,723,902 2,507,912 49.6 58,859 Nov. 1 1,252,904 493,049 377,072 2,123,025 59.0 2,105,685 1,663,377 2,515,504 50.4 63,338 8 1,316,967 480,271 374,522 2,171,760 , 60.6 2,100,839 1,661,521 2,558,196 49.8 68,864 15 1,358,416 439,392 377,877 , 2,175,685 62.4 2,109,816 1,665,677 2,562,517 49.9 72,930 22 1,281,245 428,190 368,784 1 2,078,219 61.7 2,116,257 1,632,772 2,555,215 50.5 80,504 Dec. 2 6 9 1 1, , 4 4 6 1 7 2 , , 3 5 2 1 2 1 3 4 9 0 6 2 , , 4 6 6 8 2 4 3 37 7 1 5 , , 4 3 0 4 6 1 2 2, , 2 1 3 9 5 0 , , 1 5 9 3 0 6 I ; 6 6 4 5 . . 5 6 2 2, , 1 1 2 2 1 0 , , 3 3 6 7 7 1 1 1 , , 7 6 0 6 4 8, , 2 3 8 5 3 1 2 2 , , 5 5 8 6 4 8, , 6 5 7 2 6 3 5 4 0 9 . . 0 5 8 9 6 2 , , 0 79 0 9 3 % 13 1,483,849 365,614 366,594 1 2,216,057 67.0 2,134,263 1,672,726 2,604,580 49.9 102,202 2 2 0 7 1 1 , ,4 2 0 9 0 9 , , 3 5 7 2 1 4 ' 3 3 0 0 6 2 , , 7 5 7 6 8 7 3 30 4 3 0 , , 6 7 7 6 3 5 2 1 , , 0 9 0 4 6 7 , ,0 6 6 1 7 1 6 6 6 9 . . 7 8 2 2 , , 1 1 4 33 6 , , 6 2 2 1 4 9 1 1, , 5 5 5 4 2 9 , , 8 7 9 5 2 0 2 2 , , 6 6 8 6 5 3 , , 2 7 4 0 4 1 5 50 0 . . 6 6 1 1 1 1 1 7 , , 9 1 0 2 6 2 O W Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

ANNUAL. REPORT OE THE FEDERAL RESERVE BOARD. 11 It will be noted that of the total of $897,151,000 bills discounted and bought, as shown by the statement of January 4, 1918, $285,919,000, or 31.9 per cent, consisted of paper secured by Government war obligations, the balance being other notes and bills rediscounted for member banks $339,894,000, and bills and acceptances purchased in the open market $271,338,000. While the total of paper secured by Government war obligations shows occasional temporary reduc tions brought about by payments of Treasury certificates, the general trend has been steadily upward, the total of such paper held by the Federal Eeserve Banks on December 27, being $1,400,371,000. As to the proportion of paper held by the Federal Eeserve Banks secured by Government war obligations, it will be noted that begin ning with 31.9 per cent on January 4, 1918, there were unimportant variations until March 15, when the minimum for the year was reached, 30.6 per cent, after which there was an almost constant increase until on December 27, 69.8 per cent of the paper held by the Federal Reserve Banks was secured by Government obligations. All other discounts carried at the close of the year amounted to $302,567,000, as compared with $339,894,000 on January 4. During the early part of the year these holdings declined to less than $250,000,000. During the summer months, owing, no doubt, to sea sonal loan demands, there were considerable increases, the maximum holdings of $628,920,000 occurring about the end of July. Of these a reduced proportion was composed of member banks' collateral notes secured by eligible paper. Of this class of paper the banks carried a total of $21,616,000 on December 27, 1918, compared with $61,110,000 at the beginning of the year. Agricultural paper of all maturities held on the last Friday in 1918 aggregated $29,384,000, as against $7,901,000 on the first Friday in the year. The amount of live-stock paper increased from $8,601,000 on January 4, 1918, to $27,334,000 on December 27, 1918. Maximum holdings of all three classes of paper were reported about the end of July. Holdings of agricultural and live-stock paper are concentrated mainly at the Kansas City, Dallas, and Minneapolis banks. But little change is shown in the holdings of discounted trade ac ceptances, the end of the year figures, $15,986,000. exceeding only by about $1,217,000 the figures reported at the beginning of the year. These acceptances were based mainly on domestic trade transactions, while acceptances covering foreign trade operations figured some what more prominently among the open-market purchases of the banks. Of these purchases, by far the larger part is made up of bankers' acceptances, the holdings of which show an increase for the year from Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

12 ANNUAL KEPORT OF THE FEDERAL RESERVE BOARD. creased during the year from $82,867,000 to $166,493,000, the amount of bankers' foreign acceptances decreased from $180,609,000 at the beginning of the year to $129,162,000 toward its close. Dollar ex change bills on hand aggregated $1,850,000 on January 4 as against $796,000 at the close of the year, holdings of purchased foreign trade acceptances show a decline from $5,516,000 to $3,843,000, while those of purchased domestic trade acceptances, all with bankers' indorse ments, increased from $496,000 to $3,379,000. Aggregate holdings of purchased bills, including both bankers' and trade acceptances, be cause of the substantial increase in the amounts of bankers' domestic acceptances show an increase from $271,338,000 on January 4 to $303,673,000 at the end of the year. Owing to the redemption by the Treasury of about $7,500,000 3 per cent bonds held by the banks, and through the disposal of Lib erty bonds held temporarily for the accommodation of member and nonmember banks, the Federal Eeserve Bank holdings of Govern ment long-term securities show a decline from $51,167,000 to $28,869,000. An increase from $92,058,000 to $282,677,000 in the holdings of Government short-term securities is mainly accounted for by Treasury certificates held by the Federal Reserve Bank of New York to cover temporary advances to the Government, and to a slighter degree by investments in one-year 2 per cent Treasury certificates to secure Federal Reserve bank notes. Other earning assets, composed of bill of lading drafts and municipal warrants which at the begin ning of the year amounted to $5,167,000 have declined to $13,000, due to the inclusion of the drafts with the other discounts and to the practical suspension of purchases of warrants. In the following table are shown changes in the several classes of earning assets held by the Federal Reserve Banks on the first and last Fridays of the past year: [In thousands of dollars.] Jan. 4, Dec. 27, 1918. 1918. Increase. Bills discounted: Secured by Government war obligations- Customers' paper 145,208 363,025 217,817 Member banks' collateral notes 140,711 1,037,346 896,635 Total 285,919 1,400,371 1,114,452 Otherwise secured and unsecured- Agricultural paper 7,901 29,384 21,483 Live-stock paper 8,601 27,334 18,733 Member banks' collateral notes 61,110 21,616 i 39, 494 Trade acceptances— I I n n t t h h e e f d o o r m ei e g s n t i t c r a tr d a e de 14,769 15,9 2 5 7 9 1,217 All other, n. s 247,513 208.247 i 39,266 Total • 339,894 302,567 137,327 Total discounted bills 625,813 1,702,S 1,077,125 decrease. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. 13 [In thousands of dollars.] Jan. 4, Dec. 27, 1918. 1918. Increase. Bills bought in open market: Bankers7 acceptances— In the foreign trade 180,609 129,162 151,447 In the domestic trade 82,867 166,493 83,626 Dollar exchange bills 1,850 796 i 1,054 Total 265,326 31,125 v Trade acceptances— In the foreign trade 5,516 3,843 U,673 In, the domestic trade ' 496 3,379 2,883 Total 6,012 7,222 Total bills bought in open market 271,338 303,673 United States Government long-term securities 51,167 28,869 i 22,298 United States Government short-term securities 92,058 282,677 190,619 5,167 13 15,154 All other earning assets /. Total earning assets 1,045,543 2,318,170 1,272,627 i Decrease, RESERVE POSITION OF THE,FEDERAL RESERVE BANKS. The general expansion which has taken place during the year is reflected to a limited extent in the increase in member banks' reserve deposits of $138,088,000 from $1,449,230,000 on January 4 to $1,587,- 318,000 on December 27, but in a much greater degree in the volume of Federal Reserve notes in circulation, the amount of these notes in circulation on January 4 having been $1,251,205,000, against $2,685,- 244,000 on December 27, an increase of $1,434,030,000. Other deposits, including those of the United States and of foreign governments, in creased between these dates $18,759,000, while the increase in net de posit and note liabilities during the year has been $1,540,703,000, as against an increase of gold reserves of $402,554,000. In its report for the year 1917 the Board called attention to the changes in the reserve position of the Federal Reserve Banks during the year and pointed out the effect upon their reserves of the flotation of the twTo Liberty loans. After payments for subscriptions to the first Liberty loan were made there was a notable strengthening of the reserve position, but, as stated in the report, a similar recovery sub sequent to the close of the second Liberty loan had not taken place up to December 31, 1917, which was commented upon as indicating that the process of distributing the second Liberty loan was still uncompleted. On January 4, 1918, the combined reserves of all the banks stood at 64.2 per cent. There was a gradual improvement in the reserve position until February 15 when the combined percentage was 67.7 per cent, which proved to be the highest for the year 1918. Treasury certificates of indebtedness were sold in anticipation of the two Liberty loan issues of 1918, and also in anticipation of tax payments, and since February the tendency of reserve percentages has Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

14 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. been steadily downward, recoveries being slight and temporary. The combined reserves of the banks on December 27 were 50.6 per cent, and excepting seasonal recoveries anticipated in January and Feb ruary, 1919, further declines may be expected until the financial pro gram of the Treasury has been finally completed. Due to accessions to membership of State banks and to the fol lowing up by the Federal Reserve Banks of the Board's policy of con centrating gold and gold certificates in the vaults of the Federal Reserve Banks, the total gold reserves of the banks have shown an increase during the year of $402,554,000, having increased from $1,687,720,000 on January 4, 1918, to $2,090,274,000 on December 27. Of this increase approximately $200,000,000 is due to exchanges made with the Treasury of Federal Reserve notes for gold. EFFECT OF WAR FINANCING UPON THE FEDERAL RESERVE BANKS. The effect of two years of war financing upon the Federal Reserve System can best be shown by the following table, from which it will be seen that the enormous needs of the country, both for military and commercial purposes, have been provided for and that our surplus over minimum reserves required by law has been lowered only by $17,400,000: [In millions of dollars.] Apr. 5-6, Dec. 27, 1917. 1918. Increase. Total cash reserve 962.7 2,146.2 1,183.5 Total net deposit and Federal Reserve note liabilities. 1,136.8 4,238.1 3,101.3 Total required reserve 416.7 1,617.6 1,200.9 Reserve percentage 84.7 50.6 -34.1 Total earning assets 225.6 2,318.2 2,092.6 Free gold 546.0 528.6 -17.4 Federal Reserve notes outstanding 400.7 2,855.6 2,454.9 Collateral: Required paper 122.3 2 1,567.3 1,545.0 Gold 3 378. 4 U,288.3 849.9 Note issue power 1,365.0 1,321.5 -43.5 6 per cent. 2 55 per cent. 3 94 per cent. 4 45 per cent. The table next subjoined, showing the combined resources and lia bilities of the 12 Federal Reserve Banks, indicates the changes in the various items of resources and liabilities of the Federal Reserve System during the years 1917 and 1918. The figures of March 30, 1917, show the situation immediately before the entry of the United States into the war, and those of December 27 show the condition at the close of the year, while the figures for the intermediate dates show the changes directly attributable to the Liberty loan flotations. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Combined resources and liabilities of the Federal Reserve System. [In thousands of dollars.] Mar. 30, June 22, Nov. 30, Dec. 28, May 10, Nov. 8, Dec. 27, 1917. 1917. 1917. 1917. 1918. 1918. 191,8. EESOURCES. Gold in vault and in transit 374,903 492,842 499,887 499,917 480,580 386,437 337,365 Goldsettlpmentfund, Federal RPSPTVP Board , - 200,061 267,910 395,236 317,520 437,444 435,452 374,758 Gold with foreign agencies 52,500 52,500 52,500 52,500 5,829 5,829 Total gold held by banks 574,964 813,252 947,623 869,937 970,524 827,718 717,952 Gold with Federal Reserve agents 360,668 390,765 661,824 781,851 885,027 1,145,640 1,283,309 Gold redemption fund - 2,414 8,001 12,278 19,345 27,584 73,233 84,013 Total gold reserves 933,046 1,212,018 1,621,725 1,671,133 1,883,135 2,046,591 2,090,274 Legal tender notes, silver, etc 9,282 35,680 54,486 49,635 59,365 54,248 55,945 947,328 1,247,698 1,676,211 1,720,768 1,942,500 2,100,839 2,146,219 Bills discounted: Secured by Government war obligations . - 83,185 405,608 283,421 612,324 1,316,967 1,400,371 All other : 20,106 157,799 350,790 397,285 326,717 480,271 302,567 Bills bought in open market 84,473 194,303 205,454 275,366 286,036 374,522 303,673 Total bills on hand 104,579 435,287 961,852 956,072 1,225,077 2,171,760 2,006,611 United States Government long-term securities 29,275 36,427 47,304 48,350 40,116 29,479 28,869 United States Government short-term securities 18,425 78,491 41,792 58,883 106,762 91,956 282,677 All other earning assets 15,715 2,585 1,429 4,990 1,844 28 13 Total earning assets 167,994 552,790 1,052,377 1,068,295 1,373,799 2,293,223 2,318,170 Uncollected items (deduct from gross deposits) 135,034 198,387 373,160 313,043 455,726 687,468 759,608 5 per cent redemption fund against Federal Reserve bank notes 400 500 537 537 404 3,924 5,988 5,393 267 2,499 46 66 18,790 22,005 Total resources 1,256,149 1,999,642 3,104,784 3,102,689 3,772,495 5,104,244 5,251,990 LIABILITIES. Capital paid in 56,075 57,171 68,500 70,442 75,118 79,824 80,681 Surplus 1,134 1,134 1,134 Government deposits 20,567 495,807 220,962 108,213 138,529 160,256 63,367 Due to members, reserve account 720,411 806,209 1,489,370 1,453,166 1,548,137 1,545,996 1,587,318 Collection items - 100,961 137,581 238,867 191,689 309,773 527,796 554,823 All other deposits, including foreign Government credits 1,000 19,473 17,969 110,611 114,941 106,992 Oi Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Combined resources and liabilities of the Federal Reserve System—Continued. ca [In thousands of dollars.] Mar. 30, June 22, Nov. 30, Dec. 28, May 10, Nov. 8, Dec. 27, 1917. 1917. 1917. 1917. 1918. 1918. 1918. LIABILITIES—continued. Total gross deposits 841,939 1,440,597 1,968,672 1,771,037 2,107,050 2,348,989 2,312,500 Net deposits 706,905 1,242,210 1,595,512 1,457,994 1,651,324 1,661,521 1,552,892 F F e e d d e e r r a a l l R R e es s e e r r v v e e n b o a t n e k s n in o t a e c s t i u n a l c c ir i c rc u u la la ti t o io n n , net liability 357,610 499,7 7 2 7 1 6 1,056 8 , , 9 0 8 0 3 0 1,246 8 , , 4 0 8 0 8 0 1,569 7 , , 6 8 1 7 3 8 2,55 6 8 8 , , 1 8 9 6 6 4 2,6 1 8 1 5 7 , , 2 1 4 2 4 2 o All other liabilities 525 1,377 2,629 6,722 11,697 47,237 55,309 H Total liabilities 1,256,149 1,999,642 3,104,784 3,102,689 3,772,495 5,104,244 5,251,990 O Ratio of total reserves to net deposit and Federal Reserve note liabilities combined (per cent) 89.0 71.6 63.2 61.8 60.3 49.8 50.6 Ratio of bills secured by Government war obligations to total bills on hand (per cent) 19.1 42.2 29.6 50.0 60.6 69.8 a a B W O Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

ANNUAL REPORT OF THE- FEDERAL RESERVE BOARD. 17 The material changes in the items comprising resources and liabili ties of the Federal Eeserve Banks from March 30, 1917 (which date was prior to the declaration of war and also before the act was amended on June 21, 1917, which changed reserve requirements by providing that all reserves of member banks be carried with the Federal Eeserve Banks), to December 27, 1918, have been as follows: [In millions of dollars.] RESOURCES. Increase. LIABILITIES. Increase. 1. Cash: Capital 25 Gold 1,152 Surplus 1 Legals and silver 47 Deposits: 1,199 Government 43 2. Bill holdings: Member bank 867 Discounts- Foreign Government and other credits 107 War paper 1,400 • 1,017 Other discounts 283 Federal Reserve notes 2,328 Acceptances 219 Federal Reserve bank notes 117 — 1,902 All other liabilities, net, including 1918 net 3. Government securities: earnings 55 Long term Short term 264 Total 3,543 4. Warrants a 16 5. Float 171 6. 5 per cent redemption fund against Fed eral Reserve bank notes 6 7. All other resources, net 17 Total 3,543 a Decrease. In connection with the loans and discounts, it should be noted that the increase of Government secured paper held by the banks has been about $1,400,000,000 as against an increase of commercial discounts and purchases of acceptances combined of $502,000,000. The increase in Federal Eeserve notes outstanding since March 30, 1917, has been $2,328,000,000, from which it will be seen that after making allowances for the notes which have been exchanged for gold the net expansion in note issues has been due largely to the discount by the banks of paper secured by war obligations of the Government. About two-thirds of the profits made by the banks during the year 1918 have been due to the expansion of this class of loans. The increase in capital of $25,000,000 has been due in part to the increase in capital and surplus of member banks, but principally to payments to capital account by State banks and trust companies which have become members of the S3^stem. The increase in Government deposits noted for part of the year has been due to the larger activities of the Treasury in connection with war financing. The increase in member bank deposits is accounted for by changes in reserve requirements made by the act of June 21, 1917, the growth of deposits of national banks, and by the reserves carried by the State bank and trust company members, most of which have joined the system since June 21, 1917. 100823°—19 2 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

18 ANNUAL, REPORT OF THE FEDERAL RESERVE BOARD. The increase in Federal Eeserve bank notes of $117,000,000 does not represent any material addition to the circulating medium, as most of these notes have been issued in substitution for silver certifi cates by virtue of the act of April 23, 1918, which authorizes the issue of $1 and $2 Federal Eeserve bank notes, upon the retirement of silver certificates in equal amounts, to be secured by Treasury certificates of indebtedness deposited with the Treasurer of the United States. A more extended discussion of these bank notes appears further on in this report. ACCEPTANCES. The acceptance is a comparatively new development in American finance. A few of the States, just prior to the passage of the Fed eral Eeserve Act, authorized banks and trust companies operating under State charters to accept bills of exchange drawn upon them, and the Federal Eeserve Act authorized such transactions on the part of member banks where the drafts or bills have not more than six months to run and where they grow out of transactions involving the importation or exportation of goods, the total vol ume of such acceptances outstanding at any one time not to ex ceed in the aggregate one-half of the paid-up capital and surplus of the accepting bank. The act of March 3, 1915, authorized the Fed eral Eeserve Board to permit member banks to accept and Federal Eeserve Banks to discount acceptances in a total amount not exceed ing the capital and surplus of the accepting bank, and the act of September 7, 1916, authorized member banks to accept drafts and bills growing out of transactions involving domestic shipments of goods, provided shipping documents conveying or securing title are attached at the time of acceptance, or which are secured at time of acceptance by warehouse receipts or other similar documents con veying or securing title, covering readily marketable staples. The total amount of domestic bills which may be accepted by a member bank may not exceed at any one time in the aggregate one-half of its paid-up and unimpaired capital stock and surplus. The Board had on December 31, 1918, authorized 161 member banks to accept up to 100 per cent of their capital and surplus. Pur chases of acceptances constituted the greater part of the open-market transactions of the Federal Eeserve Banks. Acceptances bought are mainly bankers' acceptances, although trade acceptances, which are drafts drawn by the seller upon the purchaser of goods and which may be either foreign or domestic in their character, are now being acquired in increasing volume, in some districts the aggregate Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. 19 Trade acceptances are discounted more freely upon the indorse ment of member banks, and a differential of one-fourth of 1 per cent is usually given in favor of these acceptances as against promis sory notes. The following tabular statement of acceptances bought in the open market by the Federal Reserve Banks during the past four years shows the large increase in the volume of the acceptance business: Acceptances bought in open market by Federal Reserve Banks. [In thousands of dollars; i. e., 000 omitted.] Purchased from Bought in open market— other Federal reserve banks. 1915 1916 1917 1918 1917 1918 Boston 14,105 52,377 86,481 194,158 5,047 6,709 New York 25,834 123,406 445,307 945,498 19,659 50,182 Philadelphia 7,565 53,122 70,710 77,686 15,204 42,321 Cleveland 2,963 27,542 51,007 122,800 40,102 54.199 Richmond 250 11,313 54,759 70,766 3,357 331 Atlanta 72 12,544 25,388 45,477 1,005 2,514 Chicago 5,782 27,061 61,142 122,787 5,572 100,077 St. Louis 1,801 20,681 22,788 26,096 6,944 4,551 Minneapolis 1,455 13,539 16,397 13,903 16,675 25,911 Kansas City 1,788 8,191 17,561 14,691 9,264 19,047 Dallas 3,543 9,743 25,024 25,333 8,242 San Francisco 3,230 32,776 48,018 150,653 20,249 22,506 Total 64,845 386,095 909,301 1,809,539 168,411 336,590 Bankers' acceptances are regarded as the most liquid of all invest ments, and it has always been the policy of the Board to permit a substantial differential in their favor. The rates on acceptances are subject to fluctuations, reflecting accurately the varying conditions of the money market, and consequently the Board has never fixed a definite rate for them but has prescribed maximum and minimum rates within the limitations of which the Federal Reserve Banks are permitted to purchase bills. In 1915 Federal Reserve Bank acceptance rates ranged between 2 and 3 per cent, and at the present time the minimum rate is 4 per cent. The private rate in London has for the past nine months been about 3| per cent against average current rates in New York of 4^ per cent. While this difference may have diverted some business to the English banks, the Board has not as yet deemed it advisable for the Federal Reserve Banks to meet the British rate, because of the large financial operations of the Treasury, and for other reasons which are stated below. It was thought that a lower rate for any class of paper than that borne by member banks' 15-day collateral notes secured by Government obligations might have an unfavorable effect upon the Treasury's operations. The British rate of 3J per cent, however, has been maintained for nearly a year, despite the fact that London banks have been paying Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

20 A1STJSTUAL REPORT OF THE FEDERAL RESERVE BOARD. 3 per cent interest on domestic balances and 4J per cent interest on foreign balances, while the British Government is paying 5 per cent on loans made to it by the United States Government. The report of the British Committee on Currency and Foreign Exchanges, dated August 18, 1918, however, indicates the possibility of an ad vance in the British discount rate on acceptances. As no reduction in the rate for paper secured by Government obligations is contem plated by the Board, a lower acceptance rate at Federal Reserve Banks would have a tendency to reduce the proportion of bondsecured paper held by them, and to bring about a corresponding increase in their proportion of commercial paper holdings. In considering rates of discount for bankers' acceptances in the United States, certain fundamental differences between the London and the New York money markets must be kept in mind. In London there is an official rate fixed by the Bank of England, known as the bank rate, and there is also an open-market or private rate. The bank rate is the rate at which the Bank of England will buy approved bills of exchange in the London market. The bank will not buy the acceptances of foreign banks domiciled in London nor of foreign agencies established in London. The London market can avail itself of the rate established by the Bank of England, which is prepared at all times to absorb bills at its prevailing discount rate. The bank itself, whenever it seems desirable, operates in the market, absorbing funds when it wishes to maintain or advance the rate, and whenever it wishes to ease the market the bank takes an active instead of a passive part in the purchase of bills of exchange. The Bank of Eng land rate is usually higher than the private rate, which is gov erned by the demand for and supply of bills of exchange. The supply is represented largely by bills drawn for the purpose of car rying on international commerce in the form of 60 and 90 days' sight acceptances drawn upon English banks and acceptance houses. The demand in the open market comes mainly from the joint-stock banks, private banks, and discount companies, and represents accumulated funds whose use in other channels is not expected to develop for some time—say, 30, 60, or 90 days and sometimes for longer periods. Bills of exchange available for discount with the Bank of England are purchased by these institutions with the knowledge that they can always be disposed of at the bank rate on the day of sale, and this knowledge gives such elasticity to investments in bills of exchange that purchases are made freely from moneys temporarily idle, and a large portion of the resources of the purchasing institu tions is carried in the shape of bills purchased at the open-market rate which are discountable at the Bank of England. Should a feel ing arise in the course of market operations that the Bank of Eng- Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. 21 land is likely to raise its rate, which is usually done in gradations of one-half of 1 per cent to 1 per cent, the open-market rate, or pri vate rate, will rise in anticipation of the change, above the official bank rate. During a period when the bank rate seems to have been established at a definite figure and when no changes are anticipated, the tendency of the private rate is to drop below the bank rate and to continue there. Bankers and discount houses purchasing bills of exchange at the private rate know that in any event they can sell their bills at the bank rate, and if this rate holds fairly steady they have an opportunity to earn the full interest obtainable on bills purchased for such time as they may be held. Furthermore, pur chasers know that if the bills are carried for a considerable portion of the time they have to run and then must be sold at the bank rate, there will be a profit on the investment for the time the bills are carried even though sold at the, higher bank rate. The accumulation of funds in London from all parts of the world has been invested to a large extent in bills of exchange for many years. Experience, demonstrating the safety of these investments, has given great elasticity to the operations and has made the open discount market in London for bills of exchange so broad that large transactions are carried on without noticeable effect upon the money market. It is therefore natural that during periods of steady money rates the private rate should rule below the bank rate. Before the war, time bills of exchange were drawn upon London covering exports and imports between England and other countries and between foreign countries, all of which created a vast turn over, which the English money market was able to absorb be cause of the accumulation of funds in London available for such investments. During the war, owing to several causes, sterling bills of exchange were not created in nearly so large a volume. One rea son for this is that the United States Government was making loans in dollars to Great Britain, France, and Italy to provide for purchases by these nations in the United States, and another is that purchases made by these nations in the United States include raw materials which have been imported into the United States to be used in the manufacture of goods for the allied powers which otherwise might have been imported direct by those nations. This applies particu larly to food, clothing, and munitions. As a result, the British money market is, or has been until recently, rather bare of bills of exchange. Funds available in London for use in the open market are probably greater now than in normal times, as there has been an accumulation due to the fact that foreign exchanges have generally ruled against Great Britain, which has made the withdrawal of sterling balances by foreign nations difficult and expensive. Even though the bank rate has been maintained at 5 per cent, the private rate has naturally Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

22 ANNUAL REPORT OF THE FEDERAL. RESERVE BOARD. fallen below this figure and has ruled around 3J per cent. The cost of converting sterling balances into balances in other countries where a higher interest rate might be obtained, added to the increased risks of such conversion due to the war, has operated to prevent transfers from the London market which otherwise might have been made. At the beginning of the war in 1914 the creation of sterling bills of exchange in all parts of the world was stopped for the time being, and as a result there was a very large amount of unloanable funds in the London open-money market. The London joint-stock banks were obliged to lower the rate of interest which they paid upon balance to a point below the normal difference of 1| per cent off the bank rate. After the third moratorium proclamation, which reestablished the credit of British institutions all over the world, the drawing of time sterling bills was resumed on a large scale, and as a result London money rates went above 6 per cent. After the United States came into the war the creation of sterling bills fell off rapidly for reasons already stated, which resulted in bringing the British money market into the position outlined. In New York, which at the present time is the only city in the* United States which has anything like a broad acceptance market, the rate established by the Federal Eeserve Bank is followed closely by the outside market, because there are not ordinarily sufficient funds available in the New York open market to absorb acceptances offered, and consequently there is no tendency for the outside rate to go below the Federal Eeserve Bank rate. Should there be a period of very easy money, it is probable that the outside rate in New York would fall somewhat below the Federal Reserve Bank rate. This will transpire whenever bankers feel that they can hold bilk until maturity without being obliged to transfer them to the Federal Reserve Bank during the life of the bills. With the present restrictions upon foreign trade and without free shipments of gold between Great Britain and the United States, the New York and London money markets stand each upon its own bottom and are not subject to the ordinary leveling process usual in normal times. This being true, the Federal Reserve Board has felt justified in basing the rates of the Federal Reserve Banks upon our own money-market conditions instead of considering them in the light of market conditions abroad, as may become necessary upon the res toration of normal conditions. The problem of establishing discount rates for acceptances through the Federal Reserve Bank in New York since the United States entered the war has, consequently, been en tirely free from any consideration of the English rate. It should be borne in mind also that our acceptance rate is applied to bills of ex change drawn upon banking institutions authorized by law to accept Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. 23 time bills under certain restrictions. Our law provides for domestic acceptances only to a limited extent (50 per cent of the capital and surplus of the accepting bank) and was framed especially to promote our foreign trade. During the wrar we wTere obliged to import on balance a very large volume from many countries, and it was necessary to afford every possible facility to aid in the financing of such imports. Too high an acceptance rate would naturally have caused more or less uneasi ness in the countries called upon to make advances against their exports to us, as the impression might have prevailed that we were pressed for funds. Prevailing rates of from 4 to 4J per cent, there fore, have seemed to be entirely natural. When a normal basis of trade is again established between the principal countries of the world, the ability of this country to uphold the dollar in foreign markets will lie partly in the judgment displayed in adjusting our acceptance and bank rates. By that time, however, the English money market, as well as our own, will have resumed a more normal condition, so that the tendency in world currents of trade will be more clearly marked. The flow of money will be more noticeable and rates will have a greater tendency to establish themselves more automatically outside of the Federal Reserve System, thereby fur nishing a surer basis for rate movement in the system. In the development of the American acceptance market it is neces sary to provide not only an outlet for acceptances but means of secur ing acceptances of bills in adequate volume, and in order to enable American banks and bankers to compete with British banking houses in financing the world's trade the combined power of American insti tutions whose acceptances can be made available in foreign markets to accept time bills must be large enough to meet all requirements, for otherwise should importers find that it is only occasionally that they can obtain dollar acceptance credits from American banks, due to the fact that these banks have reached the limit of acceptance liabilities provided by law, the importers will naturally return to the sterling acceptances which are available at all times in sufficient amounts to meet the demand. On a recent date American banks whose acceptances, under the most liberal estimate, might be regarded as available in foreign mar kets were found to have acceptances outstanding to the amount of $477,500,000, and under existing limitations on this basis their ac ceptance liability can be increased by $630,000,000, provided every bank included in the list should be called upon to accept to the full extent of its ability. Many of these banks, however, are located in inland cities, and their acceptances are undoubtedly largely against domestic transactions. When they do accept*on foreign transactions, it is usually in connection with some credit in which they have been Digitized foir nFvRiAteSdE Rt o participate. http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

24 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. In the three cities of Boston, New York, and Philadelphia the ac ceptance line (on the basis of recent totals) still available for use by the accepting institutions is only a little over $275,000,000. The cities of Baltimore, Wilmington, and Charleston on the eastern seaboard can accept for about $15,000,000 more, making a total available for the promotion of the foreign trade of cities on the Atlantic slope of about $290,000,000, while the foreign trade naturally financed- in these cities would require a much larger line if any considerable proportion were covered by dollar acceptances. In order to provide additional facilities for engaging in foreign transactions, it has been suggested to the Board that it may become advisable to amend section 13 of the act so as to permit the Federal Reserve Board to authorize any member bank having a combined capi tal and surplus of not less than $1,000,000 to 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 in volving the importation or exportation of goods, to an amount not exceeding 200 per cent of its capital and surplus, provided that no bank shall be permitted to accept for domestic transactions in an amount greater than 50 per cent of its capital and surplus or more than 50 per cent of its capital and surplus for the purpose of furnish ing dollar exchange, but that any part of the aggregate amount which a bank may be authorized to accept may be used in accepting drafts or bills of exchange growing out of transactions involving the im portation or exportation of goods. By limiting the authority to accept in the larger amount proposed, to foreign transactions, there would be no possibility of the added acceptance privilege being used for the expansion of domestic credits, and the aggregate amount of acceptances outstanding would be controlled by our foreign trade requirements. MEMBERSHIP OF STATE INSTITUTIONS. The amendments to section 9 of the Federal Reserve Act approved June 21, 1917, prescribe definite terms and conditions as to the admis sion and status of State banks as members of the Federal Reserve System, and provide also for their withdrawal upon six months' writ ten notice. The Board had already adopted a liberal policy in deal ing with State banks and trust companies, but the action of Congress has confirmed and strengthened what the Board sought to accomplish by regulation. Section 9 of the Federal Reserve Act as amended provides that any bank becoming a member of the Federal Reserve System shall retain its full charter or statutory rights as a State bank or trust company, which has been interpreted by the Attorney General of the United States as going so far as to release them from the restrictions of Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

ASnSTUAL REPORT OF THE FEDERAL RESERVE BOARD. 25 section 8 of the Clayton Act, which relate to joint directorships. Only 53 State banks and trust companies had become members of :he system up to June 21, 1917, but the legislation to which reference has just been made removed the principal obstacles in the way of State bank membership, and this, together with the patriotic desire on the part of many of the banks to assist the Government in its war financ ing, has resulted In a rapid increase in the State bank membership. The movement of the State banks into the system still continues, for the fact is appreciated that the war is not yet over in a financial sense and the State bank members, almost without exception, as the result of their experience in the system, have come to appreciate the value of membership. At the close of the calendar year 1917, 250 State institutions were members, with an aggregate capital and surplus of $520,765,000 and aggregate resources of about $5,000,000,000. On December 31, 1918, the total membership of State banks and trust companies had in creased to 936, having an aggregate capital and surplus of $750,618,000 snd aggregate resources of about $7,339,000,000. The total num ber of State banks and trust companies eligible for membership, in cluding those now members, is estimated to be approximately 8,500 with total resources of about $13,500,000,000. The present State bank and trust company membership, therefore, represents about 54 per cent of the total banking assets of all State banking institutions eligible for membership in the Federal Reserve system. Tables showing the titles, dates of admission, capital and surplus, and aggregate resources of State banks and trust companies appear in the appendix. The Board wishes to express its appreciation of the cooperation which has been given it by nearly all of the State bank commission ers, and as an illustration of the influence which has been exerted by man}?- of them the following is quoted from the annual report of the superintendent of banks of the State of Ohio for 1918: The flotation of the different Liberty loans clearly demonstrates the value of the Federal Reserve System of the National Government in this great war crisis. Time will continue to prove the soundness of the system, and as the bankers come to a fuller realization of the benefits to be derived by member ship, and what the system has accomplished for the protection of business, it is believed that more will seek membership therein. The reserve of the Federal Reserve Bank is the basis of its loaning power, and every State bank joining the system will, through its deposit of reserve with the Federal Reserve Bank, increase the credit facilities thereof. It is manifestly of great importance therefore that all qualified State banks and trust companies identify themselves with the system in order that the demands of legitimate business and the requirements of the Government may have suffi cient credit. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

26 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. reserves held by State banks, it seemed to be insufficient to meet all the demands that would no doubt come upon these institutions. Consequently, I immediately used all the argument and influence at my command to induce eligible State banks to join the Federal Reserve System, so they could not only contribute their share to the mobilized reserves of the country, but have available direct to them, as a right, the rediscount facilities of the Federal Reserve System. In my opinion the record of the State banks in Ohio in supporting the Fed eral Reserve System is a creditable one. The assets of those banks which are members at the date of this report aggregate $275,000,000. Pending applica tions when accepted by the Federal Reserve Board will increase the total ag gregate thereof to $317,000,000, or 34 per cent of the entire State banking re sources. A word of appreciation is due also to the American Bankers' Asso ciation, which has continued its campaign committee on Federal Re serve membership. This committee is doing a great deal of effective work in calling the attention of State banks to the advantages to be derived from membership in the system. The growth of State bank membership during the year 1918 is shown in the following tables: TABLE 1.—Number and total resources of State banks and trust companies, members of Federal Reserve System, by districts. [Resources in thousands of dollars.] Dec . 31, 1917. May 10,1918. June 29, 1918. Sept. 1, 1918. Federal Reserve district. N b u e m r. Resources. N b u e m r. Resources. N b u e m r. Resources. N b u e m r. Resources. Boston 14 339,722 23 528,584 24 533,264 25 539,451 New York 44 2,707,541- 63 3,099,215 66 3,026,540 82 3,084,551 Philadelphia 8 228,440 16 244.336 16 244,034 20 273,443 Cleveland 13 369,147 26 442,848 30 452,907 48 494,140 Richmond 14 43,804 20 60,405 20 60,313 26 81,695 Atlanta 20 150,656 30 180,700 38 177,031 42 200,461 Chicago 71 792,425 114 878,542 128 944,596 206 1,212,651 St. Louis 13 209,694 23 266,436 24 273,186 36 299,537 Minneapolis 16 27,527 35 46,899 40 47,127 53 60,180 Kansas City 9 68,099 16 79,695 .16 78,632 23 83,967 Dallas 11 11,133 43 26,694 58 31,271 86 46,704 San Francisco 17 65,697 40 84,392 53 125,923 66 139,020 Total 250 5,013,885 449 5,938,746 513 5,994,824 713 6,575,800 Oct . 1, 1918. NOTr . 1, 1918. Dec . 1, 1918. Jan . 1,1919. Federal Reserve district. N b u e m r. Resources. N b u e m r. Resources. N b u e m r. Resources. N b u e m r. Resources. Boston 28 564,301 28 598,677 29 599,747 31 628,462 New York 89 3,104,110 95 3,302,338 96 3,306,056 101 3,366,785 Philadelphia 22 277,845 23 316,343 28 335,928 30 339, 571 Cleveland ! 57 508,512 58 553, 664 63 557, 074 67 585, 591 Richmond 31 91,263 33 106, 309 34 107,099 37 108,984 Atlanta 45 201,672 48 236, 063 50 237,845 54 238, 500 Chicago 237 1,237,411 267 1,311,447 278 1,321,887 288 1,330,062 St. Louis 36 299,537 43 341,169 44 341,615 44 341,615 Minneapolis: 59 62,948 62 72,988 68 76,103 70 77,116 KansasCity 24 85,162 25 96, 943 27 103, 244 27 103, 244 Dallas . 89 47,382 88 52,631 99 57,098 100 57,303 San Francisco 68 139,499 77 155,504 79 156, 494 87 161 580 Total— , 785 6,619,642 847 7,144,076 895 7,197,190 936 7,338,813 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. 27 TABLE 2.—Ratio of number and total resources of State bowks and trust com panies which have joined the Federal Reserve System to total State banks and trust companies reported as eligible for membership on the basis of capi tal requirements. Dec. 31, 1917. May 10, 1918. June 29, 1918. Sept. 1, 1918. Federal Reserve district. Number. sou R r e c es. Number. sou R r e c es. Number. sou R r e c es. Number. sou R r e c es. Per cent. Per cent. Per cent. Per cent. Per cent. Per cent. Per cent. Per cent. Boston 7.1 35.0 11.7 54.5 12.2 55.0 12.7 55.6 New York 12.4 62.1 17.7 71.1 18.5 69.4 23.0 70.7 Philadelphia 3.1 30.7 6.2 32.8 6.2 32.8 7.8 36.8 Cleveland 2.1 29.7 4.3 35.7 4.9 36.5 7.9 39.8 Richmond 2.7 9.8 3.9 13.5 3.9 13.4 5.0 18.2 Atlanta 2.7 33.8 4.0 40.5 5.0 39.7 5.6 44.9 Chicago 3.4 32.7 5.4 36.3 6.1 39.0 9.8 50.0 St. Louis 1.3 28.7 2.3 36.4 2.4 37.4 3.7 41.0 Minneapolis 2.5 7.8 5.5 13.2 6.3 13.3 8.3 17.0 Kansas City 1.0 13.1 1.8 15.3 1.8 15.1 2.5 16.1 Dallas 2.3 5.4 9.0 12.8 12.2 15.0 18.1 22.4 San Francisco 2.3 6.5 5.4 8.4 7.1 12.5 9.0 13.8 Total 2.9 37.3 5.3 44.1 6.0 44.6 8.4 48.4 Oct. 1, 1918. Nov. 1, 1918. Dec. 1,1918. Jan. 1,1919. Federal Reserve district. Number. sou R r e c es. Number. sou R r e c es. Number. sou R r e c es. Number. sou R r e c es. Per cent. Per cent. Per cent. Per cent. Per cent. Per cent. Per cent. Per cent. 14.2 58.2 14.2 61.7 14.7 61.8 15.7 64.8 New York 25.0 71.2 26.7 75.7 27.0 75.8 28.4 77.2 Philadelphia 8.6 37.3 8.9 42.5 10.9 45.2 11.7 45.6 Cleveland 9.3 41.0 9.5 44.6 10.3 44.9 11.0 47.2 Richmond 6.0 20.3 6.4 23.7 6.6 23.9 7.2 24.3 Atlanta 6.0 45.2 6.4 52.9 6.6 53.3 7.2 53.5 Chicago 11.3 51.1 12.7 54.1 13.2 54.6 13.7 54.9 St. Louis 3.7 41.0 4.4 46.7 4.5 46.7 4.5 46.7 Minneapolis 9.3 17.8 9.8 20.6 10.7 21.5 11.0 21.8 Kansas Citv 2.6 16.2 2.8 18.6 3.0 19.9 3.0 19.9 Dallas ". 18.6 22.7 18.5 25.3 20.8 27.5 21.0 27.5 9.2 13.8 10.4 15.4 10.6 15. 5 11.7 16.0 Total 9.2 49.2 9.9 53.1 10.5 53.5 11.0 54.5 RATES OF EARNINGS FROM INVESTMENTS OF THE FEDERAL RESERVE BANKS. The subjoined table shows the advancing tendency of rates at Federal Keserve Banks during the year. These rates are based upon actual discount and interest earnings and corresponding holdings of each class of productive assets. The apparent decrease in the aver age rate since July is due to the increased holdings of short-time paper secured by Government obligations on which the rate at most of the banks has been 4 per cent. The apparent decline in the rate of earnings on United States securities is due to the fact that during the early part of the year advances on United States bonds and Treas ury certificates were reported in the statements of the banks as tem porary investments in these securities, while since May transactions based upon these securities have been included in bills discounted. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

28 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. Rates of earnings from investments of the Federal Reserve Banks. co B u d n i i l s t l e s d. m i b n o B a o u r i k l p g l e e s h n t t . U s S e t n t i c a e i u t t s e r e . i s d i m n T v e o n e t s a ts t l . January 3.94 3.64 3.27 3.75 February 4.02 3.79 3.25 3.81 March 3.94 3.92 3.59 3.86 April 4.14 4.18 3.56 4.07 May 4,38 4.36 3.06 4.29 June 4.31 4.25 3.00 4.20 July 4.40 4.24 2,76 4.31 August 4.35 4.38 2.87 4.27 September 4.27 4.19 2.73 4.21 October 4.22 4. 25 2.44 4.13 November 4.27 4.33 2.49 4.19 December 4.29 4. 33 2.40 4.14 Average for year 4.24 ! 4.14 2.99 4.12 EARNINGS AND EXPENSES OF THE FEDERAL RESERVE RANKS. In its previous reports the Board has called attention to the fact that the Federal Reserve Banks are not operated primarily for profit, and it seems proper to reiterate this statement at this time, although it may seem incongruous in view of the fact that the com bined gross earnings of the 12 banks for the year 1918 amounted to $67,584,417, the net earnings being $55,446,979, or just ten times the dividends paid. The net earnings were at the rate of 72.6 per cent on an average aggregate capital for the year of $76,342,000. A year ago six of the banks had paid all accumulated dividends, while two were 12 months in arrears, and four were 6 months behind. All accumulated dividends were paid by all banks on June 30, 1918, and on December 31 out of net earnings, after dividend requirements had been met, the. 12 banks carried to their surplus accounts the sum of $21,605,901, and set aside as a reserve for franchise tax to be paid to the United States, as provided in section 7 of the Federal Eeserve Act, the sum of $26,728,440. The law provides that after all expenses and dividend claims have been paid, all net earnings shall be paid to the United States as a franchise tax, except that onehalf of such net earnings shall be paid into a surplus fund until that fund shall amount to 40 per cent of the paid-in capital stock of the bank. The Federal Eeserve Bank of New York has now accumulated the maximum surplus permitted by law—40 per cent—while the per centage of surplus to capital of the other 11 banks is as follows: Per cent. Boston 22.9 Philadelphia 17.2 Cleveland 19. 6 Richmond 28. 5 Atlanta 24. 3 Chicago 29.6 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

ANJSTUAL REPORT OF THE FEDERAL RESERVE BOARD. 29 Per cent. St. Louis 21.1 Minneapolis 24. 8 Kansas City - 33.1 Dallas IS. 8 San Francisco 2G. 4 The gross and net earnings and dividends paid by all the Federal Reserve Banks for the calendar year 1918, and the amount set aside in each case for franchise tax are shown in the following table: Gross and net earnings and dividend payments of the Federal Reserve Banks during 1918; also amounts transferred to surplus fund and reserved for Gov ernment franchise tax. Federal Reserve Bank. ea G rn r i o n s g s s. ear N ni e n t gs. p D a i y v m id e e n n t d s. T to ra f n s u u s n f r d e p . r l r u e s d R G e f o r s v a e n e rv r c n h e m d is e e f o nt r tax. Boston $4,475,195 $3,505,180 $384,180 $1,460,500 $1,460,500 New York 25,314,736 22,634,033 1,195,026 7,672,676 12,795,215 Philadelphia.. 4,357,740 3,270,824 583,983 1,304,172 1,304,172 Cleveland 5,226,864 4,234,679 716,107 1,776,000 1,776,000 Richmond 2,979,048 2,335,228 232,432 1,039,799 1,039,799 Atlanta 2,293,058 1,665 585 182,473 735,000 735,000 Chicago 8,481,747 6,831,072 604,635 3,100 223 3,100,223 St. Louis 2,676,828 1,950,807 404,838 801,655 801,655 Minneapolis.. 2,049. 954 1,585,546 168,103 688,872 688,872 Kansas City.. 3,451,936 2,762,708 309.729 1,210,713 1,210,713 Dallas.....'... 2,089,526 1,554,102 261,503 592,204 592,204 San Francisco 4,187,785 3,117,215 497,675 1,224,087 1,224,087 Total... 67,584,417 55,446,979 5,540,684 21,605,901 26,728,440 The great expansion in the business of the banks, which has been reflected in their earnings, has made it necessary for them to make large additions to their working forces. The number of officers and employees in all departments at each of the Federal Reserve Banks at the close of the year wTas as follows: Boston 585 St. Louis 385 New York 2, 657 ^Minneapolis 26(7 Philadelphia 422 Kansas City ^ 480 Cleveland 589 [Dallas 403 liichraond ._ 254 San Francisco 531 Atlanta 317 Chicago 815 Total 7,705 It is evident that the Federal Reserve Banks, in order to insure the proper conduct of their business and to protect the interests of the Government, the member banks, and the public, must employ men of exceptional experience and ability. Experience has shown that the larger member banks are disposed to draw upon the Federal Reserve Banks for men to fill high official positions, and in order to retain the services of officers w7ho are constantly being tempted with outside offers at high salaries, it has become necessary to recognize this competition. While the Board has in no case ap proved salaries for Federal Reserve Bank officers as high as those paid officers of similar rank by the larger member banks in the Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

30 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. various Federal Reserve cities, it has approved salaries approxi mating the average salaries paid by the larger local banks. In the case of junior officers, heads of divisions, and clerks, the Board has recognized from the outset that the compensation paid them must be in line with that paid by the larger member banks. The Board does not believe that the Federal Eeserve Banks should become training schools for future officers of member banks; it feels, on the contrary, that sufficient inducements should be offered by the Federal Reserve Banks to make service with them attractive as a career. BANKING QUARTERS. All of the banks have found their quarters inadequate for housing their employees, and most of them have been obliged to rent space in other buildings. The vault facilities also have been found insuffi cient, and the banks have been obliged to have recourse to safe-de posit vaults owned by other institutions. In the circumstances the banks have naturally directed their atten tion to the acquisition and ownership of permanent quarters. It has been found necessary in each case to secure a location near the finan cial center, convenient not only to the local member banks but to the post office and Subtreasury; but in the opinion of the Board all pur chases have been made at reasonable figures, and in no case have maximum prices for the highest grade central property been paid. The Federal Reserve Bank of Boston has purchased a conven iently located building at a cost of $1,000,000. The building is old and may be demolished to make way for a new one specially de signed for the bank, but in the opinion of the Board the price paid represents a fair value of the lot alone. The Federal Reserve Bank of New York has acquired a property close to the financial district at a cost of about $3,100,000, and. will utilize the old buildings until it has completed its plans for a mod ern building to take their places. The Federal Reserve Bank of Philadelphia has purchased the Penn Mutual Life Building on Chestnut Street at a cost of $600,000 and is now occupying it, having remodeled it to meet requirements. The Federal Reserve Bank of Richmond purchased a lot two years ago which it has not yet improved, because of high cost of building during the war, and it has also purchased for the use of its branch in Baltimore, at a cost of $200,000, a building formerly occupied by one of the local banks, which is entirely adequate for the purposes of the branch bank. The Federal Reserve Bank of Atlanta is occupying a new building which was completed in August, the cost of the building and lot having been about $230,000. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

ANNUAL REPOKT OF THE FEDERAL RESERVE BOARD. 31 The Federal Reserve Bank of Chicago has purchased for $2,936,000 a property in the financial district most suitably located. The build ing is not regarded as being of any value and will be torn down to make room for a new structure. The Board has approved plans of the Federal Reserve Bank of St. Louis for the purchase of a building, to be remodeled for ita occupancy. The Federal Reserve Bank of Kansas City has purchased a lot for $500,000. The Federal Reserve Bank of Dallas, which purchased a building three years ago, has found its present quarters to be in adequate and has purchased a larger lot for the sum of $145,000, upon which it proposes to erect a suitable building, and it will dis pose of the building and lot now owned and occupied by it. The Federal Reserve Bank of San Francisco has acquired property near the financial center of the city at a cost of $405,000, and is now occupying a building to which additions will be made later on. The Federal Reserve Banks of Cleveland and Minneapolis have not as yet purchased lots. On December 14 the Board sent the following instructions to all Federal Reserve Banks, relating to the treatment of depreciation and extraordinary charges in closing the books at the end of the year. In order that there may be uniformity of practice, the Federal Reserve Board has approved for Federal Reserve Banks the adoption of the following rules for the treatment of depreciation and extraordinary charges against earnings and profit and loss account at the closing of books December 31, 1918: 1. Cost of Federal Reserve and Federal Reserve bank notes.—Balance of account, as shown by books on December 31, to be charged to current expense account. 2. Furniture and equipment account.—Balance of account, as shown by books on December 31, to be charged to current expense account. 3. Cost of vaults.— (a) All expenditures made during the year 1918 for vaults and vault equipment to be charged to current expense account; (b) balance of account, as shown by books on December 31, 1917, to be charged to profit and loss account. 4. Alterations and improvements.—Charge against current expense account all expenditures made during the year 1918 in repairing, altering, or remodel ing bank premises. 5. Bank premises.— (a) Where properties have been purchased with the in tention of erecting new bank buildings, banks to be permitted to charge against profit and loss account an amount sufficient to cover the estimated value of buildings which will have to be razed, such estimated valuation of buildings to be submitted to the Federal Reserve Board for approval before depreciation allowance is determined. (&) Where properties have been remodeled and are now used as permanent banking quarters by a Federal Reserve Bank, a reasonable depreciation charge will be permitted, but in no case shall it exceed 10 per cent of the estimated value of buildings on December 31, 1918. (c) Where a Federal Reserve Bank has purchased, or may purchase, a site for a new building, it will be permitted to charge down the book value of Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

32 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. premises now owned and occupied to a fair selling price, such price to be sub mitted to the Federal Reserve Board for approval before depreciation allowance is determined. 6. Apparent depreciation of Government securities.—Full provision to be made for apparent depreciation (based on market value) in Government se curities before any sum is transferred to surplus account, and provision made for Government franchise tax. No change should be made in book value of securities but depreciation al lowance should be charged to profit and loss account and credited to account " Reserve for depreciation." Depreciation should be figured on the following basis: 2 per cent bonds 1930-1938 98 4 per cent bonds 1925 106 3 per cent conversion 1946-47 _ 85 3 per cent one-year notes . 100 3| per cent Liberty loan 1947 98 4 per cent Liberty loan 1942-1947_ _„_ 93 4J per cent Liberty loan 1928-1947__ 96 7. Surplus and franchise tax.—After dividends and all allowable ,charge-offs have been made, one-half the remainder, up to 40 per cent of capital paid in, to be credited to surplus account and the balance credited to an account to be opened under the title " Reserve for franchise tax," to remain in such account until demand therefor is made by the Government, of which due notice will be given you by the Federal Reserve Board. GOLD SETTLEMENT FUND. The general plan of operation of this fund has been described in previous reports and it is therefore unnecessary to make any further explanation of it. Owing to the great increase in the volume of bus iness between the Federal Reserve Banks, caused partly by Govern ment war financing (including large transfers of funds received from the sale of certificates of indebtedness and Liberty bonds and sub sequent redistribution of these funds among various centers in pay ment for munitions and supplies for the account of the United States and the allied Governments) and partly by larger use of the collec tion and clearing facilities of the system, particularly in the matter of wire transfers from one Federal Reserve Bank to another, it was deemed expedient to install a system of daily settlements between the Federal Reserve Banks in place of the weekly clearings which had been in operation since the establishment of the fund in May, 1915. The first clearing under the daily settlement plan was made July 1, 1918. The new system has worked with facility, rapidity, and smoothness, and has eliminated much clerical work at the Federal Reserve Banks. In order to expedite the daily settlements and to improve the collection and clearing service, a leased telegraph wire system, connecting all the Federal Reserve Banks and branches with the Board's office at Washington, was installed July 1, 1918. Under the daily settlement plan each Federal Reserve Bank telegraphs the Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. 33 Board by 10 a. m., eastern time, the respective amo.unts credited to other Federal Reserve Banks on the previous day. Upon receipt of the telegrams by the Board, clearing is made by book entries, and within one hour each Federal Reserve Bank is advised of the amount of credits for its account from the other Federal Reserve Banks and also of the net debit or credit to its gold settlement account on the books of the Board. In order to eliminate unnecessary work between the San Francisco bank, its branches, and other Federal Reserve Banks, and delays in reconciling differences due to the distances between the parent bank and branches, beginning with December 2 the four branches of the San Francisco bank, located at Seattle, Spokane, Portland, and Salt Lake City, were authorized to make settlements through the fund in the same manner as the Federal Reserve Banks, except that the net debit or credit balance in the settlement of each branch is adjusted through the gold settlement fund account of the head office, as the branches do not maintain accounts with the fund. Since the installation of the leased-wire system, practically all transfers between the Federal Reserve Banks for account of the Treasury are made directly through the fund. Settlements on account of rediscount operations between the Federal Reserve Banks are also made by direct transfer through the fund, and on account of the instant contact afforded by the leased-wire system, transactions are completed within 20 minutes to 2 hours, the major portion of the time being consumed in the arrangement of details between the re spective banks. Transfers through the gold settlement fund are of great value in these operations. The transactions through the fund have a very important bearing upon the reserve position of the banks, and as all entries affecting the fund are made on the books of the Board and at the banks, simul taneously, the Board is at once informed as to the effect of the day's transactions upon the reserves of each bank. Combined clearings and transfers through the fund during the year 1918 aggregated $50,242,592,000, as compared with $27,154,704,000 in 1917, $6^33,966,000 in 1916, and $1,052,649,000 in 1915, making a grand total of $83,983,911,000 since the operation of the fund was begun May 20, 1915, A comparison of the amounts of the average weekly settlements shows clearly the growth of the volume of trans actions. Average weekly volume of clearings and transfers: 918, July 1 to Dec. 31 $1,004,596,000 1918, Jan. 1 to June 30 966,203,000 1917 522, 206, 000 1916 106, 422, 000 1915 31, 898, 000 100823°—19 3 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

34 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. Analysis of the principal transactions growing out of the Govern ment's ' financial program, and of the transactions through the gold settlement fund since the declaration of war, April 6, 1917, show^s the important part the fund has played in fiscal agency operations, for through it the Treasury has been enabled to transfer, without the actual handling of cash, vast sums from districts where they had accumulated to other districts where funds were needed to meet dis bursements, the time consumed in transfers being measured in min utes instead of days. The settlement of April 12, 1917, for the week following the decla ration of war showed totals liquidated of $293,506,000, while trans fers between Federal Reserve Banks during the week amounted to only $1,622,000, making a combined total of $295,128,000. Total clearings of the settlement of May 17,1917, amounted to $412,103,000, and constituted the largest settlement up to that date. This volume was occasioned by large transfers on account of the sale of certificates of indebtedness by the Treasury issued in anticipation of the first Liberty loan. Transfers, during the same week, between Federal Reserve Banks, largely to New York, of Government funds for ac count of the Treasurer of the United States amounted to $108,740,000, making a record total of combined clearings and transfers of $520,843,000. The volume of clearings and transfers through the fund increased steadily after this time, mainly on account of the movement of funds in connection with the Treasury's large fiscal op erations. A new record total of $1,092,920,000 for combined clear ings and transfers was made in the week ended November 22, which immediately followed the first payment of 18 per cent on the second Liberty loan November 15, 1917. There was a large increase in the volume of business during May and June, 1918, on account of the movement of funds accruing from payments on subscriptions of the third Liberty loan. Combined clearings and transfers for the week ended June 20 aggregated $1,140,- 250,000, and were the heaviest since the establishment of the fund. During the past four months the volume of combined clearings and transfers has averaged well over a billion dollars a week as the result of increased business due to movements of funds in connection with the fourth Liberty loan. During the past year the Federal Reserve Banks and the Federal Reserve agents have found it desirable to make payments for credit to their gold redemption funds against Federal Reserve notes, and to the banks' redemption funds against Federal Reserve bank notes, by transfers from their balances with the Federal Reserve Board to the Treasurer of the United States. Several of the Federal Reserve Banks also make payments to the Treasurer of the United States Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. 35 for the credit of national banks in the 5 per cent redemption fund against national bank currency by transfers from their balances in gold settlement fund account. Total balances to the credit of the Federal Reserve Banks and agents amounted to $1,330,423,000 on December 31, 1918, divided as follows: Federal Eeserve Banks $401,926,000 and Federal Eeserve agents $928,497,000. Total increase in the combined funds during 1918 amounted to $522,176,000, as compared with $535,927,000 during 1917. PROPOSED INTERNATIONAL GOLD FUND. The successful operation of the gold settlement fund has sug gested the possibility of avoiding shipments of gold from one country to another in settlement of balances arising out of ordi nary commercial transactions, and the Board is ready, if author ized to do so, to undertake negotiations looking to the establish ment of an international gold exchange fund, or to assist in any way in its power in negotiations which may be begun by a Govern ment department looking to that end. The Board realizes that the successful operation of a plan of this kind is dependent upon the stability of the governments concerned, and believes that definite plans can not perhaps be worked out until a stable peace has been assured. The Board would point out the importance of excluding all transactions arising from the adjustment of war obligations and of limiting the work of the fund to current commercial and exchange transactions. The gold deposited in a government bank or banks should be in the nature of a special or trust fund, and all nations par ticipating should deposit their proper proportions of gold. Assum ing that the leading nations of the world will be at peace for a long period of years, there seems to be no reason why an international ar rangement of this kind should not operate as efficiently as our own gold settlement fund, which has cleared enormous transactions be tween distant sections of a country of vast area. The saving of loss and expense incident to abrasion and transportation charges and interest on gold transferred will be enormous, and the advantage to the commerce of the world w^ill be incalculable. It will probably be necessary in the beginning to limit participation in the fund to the United States and the entente allies, and to a few of the leading neutral nations, but it is conceivable that all civilized countries may eventually be participants. EXPORT OF GOLD COIN, BULLION, AND CURRENCY. As the country's activities in connection with the war gained momentum and Government financing assumed large proportions, resulting in constantly expanding issues of Federal Eeserve notes, it Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

36 ANNUAL, REPORT OF THE FEDERAL RESERVE BOARD. became apparent that in the national interest every effort should be directed toward the conservation of our gold supply. Under the power delegated to the Board by the Secretary of the Treasury under the Executive orders of September 7, 1917, October 12, 1917, and January 26, 1918, a committee of the Board meets daily to consider and pass upon all applications for permission to export coin, bullion, and currency; and the closest scrutiny has been given to all applica tions, each being treated upon its own merits. Until the signing of the armistice, first consideration was compatibility with the national interest, due regard being given to proposed exports of coin, bullion, and currency necessary to obtain certain essential commodities—such as nitrate for use in powder making; copper, lead, antimony, tungs ten, and platinum for use in the manufacture of munitions; petro leum for shipping, motor trucks, aeroplanes, and other motor-driven apparatus; hides for the manufacture of leather, and other miscel laneous commodities. During the month of May some minor modifications were deemed necessary in the regulations which had been issued by the Board governing the exportation of coin, bullion, and currency, particu larly in that section relating to funds carried by travelers leaving the country. Under the original regulations issued travelers leaving the country were permitted to carry on their persons or in their baggage United States notes, national bank notes, and Federal Reserve notes to the amount of $5,000; American silver dollars, subsidiary silver coins, and silver certificates to the amount of $200; and gold coin or gold certificates to the amount of $200. This rule was modified so that travelers were permitted to take with them United States paper currency, other than gold or silver certificates, to the extent of $1,000 for each adult, with the further provision that subsidiary silver coins not to exceed $100 for each adult might be taken in lieu of a like* amount of notes. With few exceptions travelers do not carry large sums of money for personal expenses, as their needs are better served by the use of foreign drafts or travelers' checks; nor was the permis sion to carry gold certificates of more than slight value to the traveler. While the amount was small in individual cases, in the aggregate it was considerable and meant the loss of so much gold. Another and far more important reason for the modification of the regulations was the belief that United States currency taken into foreign countries by travelers was being absorbed by enemy agents for propaganda pur poses. To further curtail the activities of enemy propagandists it also became necessary, in granting permission for the exportation of foreign paper currencies, to restrict such exportations to the country of origin. In order that persons, firms, or corporations located near the Can adian border, who in the usual course of business receive Canadian Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. 37 currency, might be subjected to as little inconvenience as possible, the Federal Reserve Banks were instructed to grant, whenever they felt justified in so doing, blanket licenses for such exportations, the licensee to make report of each shipment. From September 7, 1917, to December 31, 1918, the amount of Canadian currency exported under general authority granted by Federal Reserve Banks amounted to about $15,000,000. For some time exportations of silver to China were freely permitted in order to aid financing of importations to the United States. How ever, the silver situation in India becoming acute at a time when war conditions on the western front and in Mesopotamia made it impera tive that a crisis in India should be avoided at all hazards, it was found necessary to restrict the private exportation of silver to the financing of importations of products which had been contracted for by departments of the Government. The extent of assistance ren dered by the United States in meeting the demand for silver in India is shown as follows: Licensed for export Sept. 7, 1917 to Dec. 31, 1917 : To India $20, 932, 565. 20 To the United Kingdom 5,403,639.99 Total 26, 336, 205.19 Jan. 1, 1918, to Dec. 31, 1918 To India 212, 310,188.15 To the United Kingdom 39,035,375.00 Total 251, 345, 563.15 The total amounts involved in licenses granted for the export of coin, bullion, and currency from September 7, 1917, to December 31, 1918, are: Gold, $128,688,515; silver, $351,316,000; currency, $105,- 056,568; an aggregate of $585,061,083. Details, showing countries to which these exports went, appear in the appendix. The Board was confronted with a difficult problem in passing upon applications to export gold to Mexico, for it was evident in view ot the gold premium in Mexico that our own stock of gold would be subjected to a heavy drain unless protective measures were adopted which would serve to curtail what appeared to be an insatiable de mand. At the same time it was clear that if the exportation of gold to Mexico should be prohibited entirely, our nationals conducting large mining, oil, and other operations in Mexico, being forced to pay exorbitant prices for Mexican gold in order to comply with the reimportation requirements and decrees of the Mexican Government, that taxes, export duties, and import duties be paid in gold, would be forced to stop production which would prevent the importation of material and commodities necessary for the prosecution of the war. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

38 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. The Board therefore adopted the policy of permitting exportation^ of gold to Mexico by mining companies to cover the reimportation requirements of the Mexican Government against new product of mine gold or silver exported to the United States, to the extent of 100 per cent of the value of gold and 25 per cent of the value of silver coming into the United States. By the return of this gold to Mexico the mine operators were able to use it for the payment of taxes, export and import duties, and to some extent wTages. The Board also decided, with respect to Ameri can oil interests in Mexico, that it would permit the exportation of a sufficient amount of gold to allow producers to pay their taxes and bar dues on oil exported to the United States, import duties on commodities necessary in their operations imported from the United States, and one-half of their pay rolls. Later on large amounts of gold having gone to Mexico on account of mine operators' reimporta tion requirements, exchange rates fell to such an extent as to enable producers to purchase in Mexico, at a moderate premium, the gold necessary for their requirements. The Board let it be known that while it preferred that the producers obtain in Mexico gold for their requirements, it stood ready to permit exportations of American gold whenever an excessive premium was demanded. With an abundance of American gold in Mexico, and with increased exports of various commodities from the United States to that country, there is no reason for United States currency to be at a discount in Mexico at a rate exceeding the cost of shipping gold, and for several months our currency has been circulating there with greater facility and in larger volume. For some time, in order to meet the wishes of the Food Adminis tration and other governmental agencies, licenses were granted for the exportation of gold, to enable shippers of sisal, hides, cattle, bones, ixtle, garbanzos, and other miscellaneous commodities from Mexico to the United States, to pay Mexican export duties in gold as demanded by the Mexican Government, but conditions later became so changed, that, after consultation with the governmental depart ments and agencies interested, applicants were notified that exports of gold would not be permitted for paying export duties on miscel laneous commodities shipped to the United States, but that the Board would give favorable consideration to applications for permission to export United States paper currency other than gold or silver cer tificates for use in that connection. In the execution of its policies, the Board has been mindful of both the national and the individual interest, but at the same time it has endeavored to retain in the United States gold which other wise would have been exported. For the period September 7, 1917, Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. 39 December 31, 1917, licenses were granted permitting gold exporta tion to Mexico of $14,151,000, an average of $3,538,000 monthly. From January 1 to June 30, 1918, licenses permitting the exportation of $17,690,000 were granted, an average of $2,948,000 monthly; and for the period July 1 to December 1, 1918, licenses were granted ag gregating $11,444,000, an average of $1,907,000 monthly, and during December the exports authorized amounted to $2,229,000. The Board has recently allowed considerable amounts of gold to go to Colombia, from which country we import during normal times between $6,000,000 and $7,000,000 worth of gold per annum, upon an engagement by the licensees that gold in the amounts exported will be reimported within 12 months. The Board has in all meritorious cases granted licenses for the exportation of United States currency other than gold and silver certificates, and it is interesting to note the ex tent to which our currency is being used in Canada, Mexico, Central America, and the West Indies. Permits for shipments to these coun tries and dependencies of more than $86,000,000 currency have been granted. Since the signing of the armistice the demand for gold has been far less urgent and a larger use of our currency in neighboring countries is evident. REGULATION AND CONTROL OF FOREIGN EXCHANGE. EXECUTIVE ORDER. Executive order prescribing rules and regulations under section 5 of the trading-tvith-the-encmy act and supplementing rules and regulations heretofore prescribed under title 7 of the espionage act. Whereas, by virtue of the authority vested in me by the act approved June 15, 1917, known as the Espionage Act, I directed by Executive order, dated Sep tember 7, 1917, that the regulations, orders, limitations, and exceptions pre scribed by me in relation to the export of coin, bullion, and currency should be administered by the Secretary of the Treasury, and upon his recommendation prescribed certain regulations in relation thereto; and Whereas, by Executive order, dated October 12, 1917, made under authority of the act aforesaid and of the act approved October 6, 1917, known as the Trading-with-the-Enemy Act, I vested in the Secretary of the Treasury the executive administration of any investigation, regulation, or prohibition of any transactions in foreign exchange, export, or earmarking of gold or silver coin or bullion or currency, transfers of credit in any form (other than credits relating solely to transactions to be executed wholly within the United States)1 and transfers of evidences of indebtedness or of the ownership of property be tween the United States and any foreign country or between residents of one or more foreign countries by any person within the United States, and I fur ther vested in the Secretary of the Treasury the authority and power to re quire any person engaged in any such transaction to furnish, under oath, com plete information relative thereto, including the production of any books of account, contracts, letters, or other papers in connection therewith in the Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

40 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. Whereas, by said Executive order, dated October 12, 1917, I authorized and directed the Secretary of the Treasury for the purpose of such executive ad ministration to take such measures, adopt such administrative procedure, and use such agency or agencies as he may from time to time deem necessary and proper for that purpose; and Whereas, the Secretary of the Treasury, with the approval of the President, by order dated November 23, 1917, adopted certain administrative procedure for the executive administration, authority and power vested in the Secretary of the Treasury by said Executive order, dated October 12, 1917, and desig nated the Federal Reserve Board to act as the agency of the Secretary of the Treasury, subject to the approval of the Secretary of the Treasury, to carry out such executive administration, authority and power vested in the Secre tary of the Treasury as hereinbefore recited: Now, therefore, upon the recommendation of the Secretary of the Treasury, • and in order to vest all necessary authority in the Federal Reserve Board to act as the agency of the Secretary of the Treasury, in the performance of the duties hereby imposed upon it, I hereby prescribe the following orders, rules, and regulations in respect of such executive administration, authority and power, and I hereby amend the regulations heretofore prescribed by said Executive order dated September 7, 1917, as herein provided. DEFINITIONS. Person.—The term person as used herein shall be deemed to mean an indi vidual, partnership, association, company or other unincorporated body of individuals, or corporation or body politic. Dealer.—The term dealer as used herein shall be deemed to mean any person engaged primarily or incidentally in the business (1) of buying, selling, or dealing in foreign exchange, or (2) of buying, selling, or dealing in securities for or through foreign correspondents, or (3) any person who carries accounts or securities with or for foreign correspondents. Dealers of Class A.—Dealers who engage in the business of buying, selling, or dealing in foreign exchange, or of buying, selling, or dealing in securities for or through foreign correspondents, and who may or may not carry accounts or securities with or for foreign correspondents shall be known as dealers of Class A. Dealers of Class B.—Dealers who carry accounts or securities with foreign correspondents or who buy, sell or deal in securties through such correspondents but who do not carry accounts or securities for foreign correspondents and who do not engage in the business of buying, selling, or dealing in foreign exchange or of buying, selling, or dealing in securties for foreign correspondents shall be known as dealers of Class B. Dealers of Class C.—Dealers who carry accounts or securities for foreign cor respondents or who buy, sell, or deal in securities for such correspondents but who do not carry accounts or securties with foreign correspondents and who do not engage in the business of buying, selling, or dealing in foreign exchange or of buying, selling, or dealing in securities through foreign correspondents shall be known as dealers of Class C. Foreign Exchange.—The term foreign exchange as used herein shall be deemed to mean checks, drafts, bills of exchange, cable transfers, or any form of nego tiable or assignable instrument, or order used (a) to transfer credit or to order the payment of funds in any foreign country, or (b) to transfer credit or to order the payment of funds within the United States for foreign account. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. 41 Securities.—The term securities as used herein shall be deemed to mean all evidences of ownership of property not included in the foregoing definition of foreign exchange. Correspondent.—The term correspondent as used herein shall be deemed to mean any person who acts as the agent of, or for, or on behalf of, or as the depositary of, another person, or any person who is the principal for, or on behalf of, whom another person acts as agent. Customer.—The term customer as used herein shall be deemed to mean any person other than a dealer who buys foreign exchange from a dealer or sells foreign exchange to a dealer. TRANSACTIONS IN FOREIGN EXCHANGE AND CERTAIN OTHER TRANSACTIONS PRO HIBITED EXCEPT AS HEREIN AUTHORIZED. All transactions in foreign exchange, export or earmarking of gold or silver coin or bullion or currency, transfers of credit in any form (other than credits relating solely to transactions to be executed wholly within the United States) and transfers of evidences of indebtedness or of the ownership of property between the United States and any foreign country, whether enemy, ally of enemy, or otherwise, or between residents of one or more foreign countries, by any person within the United States, except any such transactions or transfers conducted in conformity herewith, are hereby prohibited. TRANSACTIONS IN FOREIGN EXCHANGE OR IN SECURITIES FOR OR THROUGH FOREIGN ACCOUNT. Certain persons required to obtain registration certificates.—No person, other than a customer, shall, after February 10,1 1918, engage in any transaction or make any transfer described in the next preceding subdivision hereof who shall not have obtained, on or before that date, a registration certificate, as herein after provided. Every person who is a dealer upon the date hereof, as promptly as possible and in any event on or before January 31,a 1918, shall file, with the Federal Reserve Board, through the Federal Reserve Bank of his district, an applica tion for a registration certificate. Such application shall be in form approved by the Federal Reserve Board and shall show the character of business engaged in and wiiether or not an enemy or ally of enemy of the United States or any subject or citizen of an enemy or ally of enemy, wherever resident or domiciled, has any interest directly or indirectly in such business. Such application shall. embody an agreement on the part of the applicant to comply with the regula tions of the Federal Reserve Board, and to permit the inspection at any time of his books and accounts and to make reports as and when required on forms to be approved by the Federal Reserve Board. The Federal Reserve Board may issue to such applicant the appropriate registration certificate in form approved by it, entitling the holder to engage in the class or classes of foreign exchange or other transactions specified in such certificate, subject to all applicable provisions of law and to such Execu tive orders of the President and administrative regulations as shall have been issued or may from time to time be issued by the Federal Reserve Board. Any person who is not a dealer at the date hereof but who hereafter desires to become a dealer must first obtain a registration certificate. Any person, other than a customer, who does not desire to become a dealer but who nevertheless desires to engage in one or several transactions or to 1 Under power of Federal Reserve Board to waive requirements, time extended to Feb. 15, 1918. 2 Id., time extended to Feb. 5, 1918. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

42 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. make one or several transfers described in the next preceding subdivision hereof, may be permitted by the Federal Reserve Board, in its discretion, to engage in any such transaction or to make any such transfer without first obtaining a registration certificate, and the Federal Reserve Board may like wise waive any requirement hereof, other than any which relates to trading with an enemy or ally of enemy, whenever it is satisfied that such waiver is not incompatible with <the best interests of the United States. Nothing herein shall be construed to abrogate or modify any existing re quirement that licenses shall be obtained from the War Trade Board in respect of any transaction with, or for account of, an enemy or ally of enemy, or any person acting for, or on behalf of, or for the benefit of, an enemy or ally of enemy. Revocation of registration certificates.—Any or all such registration certifi cates may be revoked at any time by direction of the Secretary of the Treasury or of the Federal Reserve Board. Books and accounts.—Each Federal Reserve Bank through which any such registration certificate shall be issued shall furnish, to the applicant, copies of all forms of reports required and the books and records of such applicant shall thereafter be kept in a manner which will make it possible to furnish information called for in such reports without delay. General reports.—After obtaining a registration certificate, each holder thereof shall file with the Federal Reserve Bank through which such certificate shall be issued a report, on forms to be furnished by the Federal Reserve Board, showing all accounts or securities carried with or for foreign correspondents as of the close of business on January 30,1918, or on such other date as the Federal Reserve Board may require, and such other information as may be called for on such forms and shall thereafter file with the Federal Reserve Board, through such Federal Reserve Bank, on dates specified by the Federal Reserve Board, reports showing all changes in such accounts and all purchases, sales, and other transactions in foreign exchange or securities for or through foreign corres pondents. Customers9 statements.—A dealer shall require every customer purchasing foreign exchange from him or selling foreign exchange to him to file a statement showing the purpose of such purchase or sale with such details as the Federal Reserve Board may require, including a declaration to the effect that no enemy or ally of enemy of the United States has any interest directly or indirectly in such purchase or sale. The Federal Reserve Board shall prescribe the form of such declaration. Copies of such statements shall be furnished by such dealer upon request to the Federal Reserve Board, through the several Federal Reserve Bank;s. Reports made through domestic correspondents.—Dealers to whom registra tion certificates have been issued, and who buy, sell, or deal in foreign ex change through domestic correspondents (for example banking or other institu tions located in the United States), unless otherwise directed by the Federal Reserve Board, shall arrange with such correspondents to include such trans actions in the reports of such correspondents. Such dealers will be required to report to the Federal Reserve Board only those foreign exchange transactions which are not included in the reports of such correspondents but may be called upon for any information in regard thereto desired by the Federal Reserve Board, and shall keep all books and records in a manner which will make it possible to furnish such information. Special reports.—Whenever any holder of a registration certificate shall have reason to believe that any transaction within his knowledge involves or Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. 43 may involve directly or indirectly the payment of funds or delivery of securities to or the transfer of credit or securities for the benefit of an enemy or ally of enemy, or which may involve any other transaction with an enemy or ally of enemy, he shall immediately report the facts and circumstances to the Fed eral Reserve Board through a Federal Reserve Bank. Filing and verification of reports.—All reports, statements, and declarations herein required, unless otherwise specified, shall be filed with the Federal Re serve Board through the Federal Reserve Banks. Any or all such reports, statements, or declarations shall, in the discretion of the Federal Reserve Board, be verified by oath of the person making same. Examinations.—The books and records of all dealers must at all times be open to inspection by examiners designated by the Federal Reserve Board. DECLARATION OF FOREIGN CORRESPONDENT TO BE OBTAINED BY HOLDERS OF REGIS TRATION CERTIFICATES. After dates to be fixed by the Federal Reserve Board in respect of each for eign country, respectively, no holder of a registration certificate shall engage in transactions with, through, or for any foreign correspondent in such foreign country unless he shall have obtained from such correspondent a declaration to the following effect: Having arranged with to act as the agent or [Holder of registration certificate] correspondent in the United States for, or on behalf of, the undersigned, under regulations issued by the appropriate authorities of the United States Govern ment and/or the undersigned having agreed to act as the foreign correspondent of the said I/we do hereby declare that I/we will not deal or attempt to deal, directly or indirectly, with said agent or corre spondent in any transaction for or on account of, or for the benefit of, an enemy or ally of enemy of the United States, and will not make available for the use of an enemy or ally of enemy of the United States any funds or property received or credits established as a result of any transaction engaged in with or through said agent or correspondent, and will not transmit to said agent or correspondent for collection or credit any negotiable instrument bearing the signature or indorsement of an enemy or ally of enemy of the United States. The words " enemy " and " ally of enemy " are used herein as now or here after defined by laws of the United States or by Proclamation of the President of the United States. NOTE.—If foreign correspondent is incorporated this certificate must be executed by a duly authorized officer of such corporation. SUSPENSION OF RELATIONS WITH FOREIGN CORRESPONDENTS. If any foreign correspondent of a dealer in the United States or any person proposing to become the foreign correspondent of a dealer in the United States, shall refuse or fail to make the foregoing declaration as herein required, or if the Federal Reserve Board shall have reason to believe that any such foreign correspondent or any such person is dealing or trading with an enemy or ally of enemy of the United States, contrary to the provisions of the declaration of noninterest of enemies, herein required, or if in the judgment of the Federal Reserve Board the best interest of the United States requires such action, it may prohibit any dealer or dealers in the United States from engaging in any transaction with, through, for, on on behalf of such correspondent or such person. SUSPENSION OF TRANSACTIONS. Whenever the Federal Reserve Board shall have reason to believe that any transaction in foreign exchange or any transfer of securities carried with or for a foreign correspondent involves or may involve trading with an enemy, Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

44 ANNUAL, REPORT OF THE FEDERAL RESERVE BOARD. or ally of enemy, or in its judgment is incompatible with the best interest of the United States, it may cause notice to be served on the parties in interest to postpone the consummation of such transaction for a period of ninety days pending investigation of the facts, and upon investigation if the Federal Reserve Board is of the opinion that the best interests of the United States require such action it may prohibit the consummation of such transaction. The Secretary of the Treasury may likewise prohibit the consummation of any such transaction by notice served on the parties in interest (either directly or through the Federal Reserve Board) in any case in which in his judgment the best interests of the United States require such action. SPECIAL PEOVISIONS AS TO COLLECTION OF DIVIDENDS, INTEEEST OK MATURING OBLI GATIONS FOR FOREIGN ACCOUNT. Every person presenting for collection maturing obligations, or coupons, checks or drafts issued for dividends or interest, for account of any foreign Government or person resident in any foreign country, shall make a declaration in form approved by the Federal Reserve Board, to the effect that such col lections are not made for, or on behalf of, or for the benefit of, any enemy or ally of enemy; that the proceeds of such collections will not be made available for any enemy or ally of enemy; and that the maturing obligations, or the obligations and stocks upon which dividends or interest are to be paid, are not the property of any enemy or ally of enemy; have not been owned by, or held for the account of, any enemy or ally of enemy, since January 26, 1918, and were, not purchased by the present owner from any enemy or ally of enemy or from any person acting for or on behalf of or for the benefit of an enemy or ally of enemy since February 3, 1917. Provided, however, that any holder of a Class A or Glass G registration certi ficate, may collect maturing obligations and coupons, checks, or drafts issued for dividends or interest for account of a person resident in a foreign country, without making such declaration, if such holder has filed with the Federal Reserve Board a similar declaration executed by the person for whom collection is made. Interest or dividend checks payable for foreign account.—Every person issuing checks or drafts for interest or dividends after January 26, 1918, pay able to any foreign Government or to any person resident in a foreign country shall attach to or shall print on the back of such check or draft the following statement: This check or draft will not be paid unless the following declaration is exe cuted by the person to whom it is sent for collection by the payee, or his agent, or by the person who acts as the agent in the United States for the payee. From actual personal knowledge, or in reliance upon declarations or affidavits furnished the undersigned by the parties in interest, I/we do hereby expressly, declare that no enemy or ally of enemy of the United States is directly or indi rectly interested in the proceeds of this check or draft and that such proceeds will not be made available for the use of an enemy or ally of enemy of the United States; that the stock upon which this dividend is paid (or the obliga tion upon which this interest is paid) is riot and has not been owned by or held for account of an enemy or ally of enemy of the United States since Jan uary 26, 1918, and has not been purchased by the present owner from an enemy or ally of enemy or from a person acting for or on behalf of or for the benefit of an enemy or ally of enemy since February 3, 1917. DEALINGS IN SECURITIES FOR OR THROUGH FOREIGN ACCOUNT. No person shall purchase, sell, or deliver any securities for account of any foreign Government, or for account of any person resident in a foreign country, unless such Government or such person, as the case may be, shall have made a Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. 45 declaration, in form approved by the Federal Reserve Board, similar in effect to that required in the case of the collection of maturing obligations, for ac count of a foreign Government or person resident in a foreign country. PROCEDURE WHERE DECLARATION OF NONINTEREST OF ENEMY OR ALLY OF ENEMY CAN NOT BE MADE. Any person who is unable to make a declaration of noninterest of enemy or ally of enemy required hereunder may apply to the Federal Reserve Board for a waiver of such declaration, submitting to such board all facts and circum stances relating to the transaction involved which are in the possession of the applicant. If upon investigation the Federal Reserve Board shall determine that there is no reason to believe that any enemy or ally of enemy is directly or indirectly interested in the transaction involved, and that its consummation will not be incompatible with the best interests of the United States, it may permit the transaction to be consummated without the declaration herein re quired. If the Federal Reserve Board shall have reason to believe that an enemy or ally of enemy is or may be directly or indirectly interested in the transaction, it shall transmit to the War Trade Board all records in the case for such action as that board may determine to be necessary. EXPORT AND EARMARKING OF COIN, BULLION, OR CURRENCY. The following regulations prescribed by Executive order, dated September 7, 1917, shall continue in force as herein amended. Any person 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 person is located for a special or general license. Applications filed must contain statements under oath and showing in detail the nature of the transaction, the amount in volved, the parties directly and indirectly interested, and such other informa tion 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. All such applications should be made on the standard form prescribed by the Federal Reserve Board. 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 Washing ton, 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. The Federal Reserve Board, subject to the approval of the Secretary of the Treasury, is hereby authorized and empowered, upon receipt of such applica tion 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 exporta tion in question be compatible with the public interest, to permit said exporta tion to be made; otherwise to refuse it. No gold or silver coin, or bullion, or currency shall be set aside and ear marked for safekeeping for any person without the written approval of the Federal Reserve Board. LICENSES FROM WAR TRADE BOARD IN TRANSACTIONS INVOLVING TRADING WITH AN ENEMY OR ALLY OF ENEMY. Applications to the Federal Reserve Board for permission to export or ear mark gold or silver coin or bullion or currency shall be accompanied by a certified copy of a license issued by the War Trade Board, whenever any such Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

46 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. transactions involve or may involve trading directly or indirectly with an enemy or ally of enemy or with any person acting for, or on behalf of, or for the benefit of, an enemy or ally of enemy. APPLICATIONS FOR REGISTRATION CERTIFICATES AND EXPORT LICENSES, PROVIDED FOR HEREUNDER, BY PERSONS RESIDING IN ANY DEPENDENCY OF THE UNITED STATES. Applications to the Federal Reserve Board either for registration certificates or for licenses to export coin, bullion, or currency may be made by persons residing in any dependency of the United States (including the Philippine Islands, Alaska, Guam, Hawaii, Porto Rico, Virgin Islands, and Canal Zone) through such agency located in any such dependency as may be hereafter desig nated by the Federal Reserve Board, instead of through a Federal Reserve Bank; but until an agency has been so designated in any such dependency, persons residing therein may make such applications through any Federal Reserve Bank. The Federal Reserve Board may from time to time postpone, in respect of any one or more of such dependencies, the date on and after which persons residing therein shall be prohibited from engaging in any of the trans actions or making any transfer hereinbefore prohibited without having obtained registration certificates, in case such registration certificates can not be ob tained on or before the date hereinbefore specified. (Signed) WOODROW WILSON. THE WHITE HOUSE, 26 January, 1918. The supervision and control of foreign exchange transactions is closely related to the conservation of gold, and the Division of For eign Exchange of the Federal Eeserve Board was organized to enable the Board to carry out the provisions of the Executive o^der of January 26, 1918, and to cooperate with the Treasury Department in meeting the unusual problems in foreign exchange created by the war. - The work has been carried on under three divisions—adminis trative, research, and statistical. There are 91 employees in the division, exclusiye of the director and assistant director, whose serv ices have been given without compensation. ADMINISTEATIVE DEPARTMENT. In order to transact a foreign exchange business all " dealers " in foreign exchange, including bankers, brokers, exporters, and im porters who maintain accounts in foreign countries or carry accounts for foreign correspondents, are required, under the terms of the Executive order, to register their names with the Division of Foreign Exchange of the Federal Eeserve Board, through the Federal Eeserve Banks of their respective districts. Under the system of reports re quired, together with the close relationship which has been developed with the cable censorship and the postal censorship in connection with communications covering financial transactions, it has been possi ble to exercise a control over the consummation of all foreign finan cial operations, while leaving the necessary freedom of action to " dealers." Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

ANNUAL REPORT OF THE FEDERAL, RESERVE BOARD. 47 Headquarters of the division were established in the Treasury Building in Washington, but the main office for the conduct of the work was located in New York City. This was necessary in order to enable the division to act promptly upon applications of " dealers " for permission to carry out certain operations required under the Ex ecutive order and the regulations issued in connection with it, as probably 95 per cent of the applications are made by New York " dealers." This arrangement has necessitated weekly trips by the director between Washington and New York, but the expeditious service required, because of the nature of the financial operations in volved, could not have been rendered otherwise. Upon receipt of their registration certificates, " dealers," wTith a few exceptions, were authorized to carry on their foreign exchange transactions without reference to the Division of Foreign Exchange, provided reports were made on the prescribed forms. As the war progressed, however, it became necessary to require the approval of the director before a number of operations could be carried out, such as transactions in certain exchanges, the issuance of letters of credit, or the making of transfers of funds to cover the shipment of goods from one foreign country to another, the issuance of travelers' letters of credit in excess of $5,000, the issuance of credits to cover goods to be warehoused, which could not be exported or imported because licenses were unobtainable from the War Trade Board, the investment of American funds in foreign countries, action upon confirmations of cablegrams where the cables themselves had never been received, and arbitrage transactions. At the outset, rulings under the Executive order were required in great number, in cases which called for immediate decisions in order to allow the continuance of legitimate business without interruption. As these requests also came largely from New York institutions, the establishment of the main office in New York City was found to be fully warranted. " Dealers" desiring to consummate transactions where approval is required beforehand, make application by letter, in duplicate, through the Federal Reserve Banks of their districts,- or direct to the Division of Foreign Exchange. Where approval can be given, it is stamped upon the duplicate letter, which is returned by the mes senger from the " dealer" presenting the application. As such a large percentage of applications are made in New York, and practi cally all of such applications come from " dealers " situated in cities where there are Federal Reserve Banks which can communicate with the director by telephone or telegraph, this system has enabled transactions to be consummated without delay, wherever approval could be given without extended investigations made necessary by the national interest. When enemies or allies of enemies have been Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

48 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. involved, delays have been unavoidable, but even in such cases, where the interests of the United States were not jeopardized, nor the enemy benefited through the carrying out of the transactions applied for, and when it has been of value to our nationals to have" them con summated, authority to operate has been extended after receipt of license from the War Trade Board or proper release from any other department of the Government which might be concerned. RESEARCH BUREAU. A research bureau has been established and developed as an aid to all bankers and other " dealers " who have been desirous of following the letter and spirit of the Executive order of the President and of the trading with the enemy act, and who otherwise would have been unable, in many cases, to determine with certainty whether or not it was in order for them to transact business with many foreign and American houses which had approached them, or where transactions for unknown persons were going through them. To protect such- " dealers," and also the interests of the country, the research bureau has been developed as a sort of clearing house for all other govern mental research bureaus, in so far as the work of these agencies con cerned persons or institutions attempting to carry out financial trans actions. Frequently, reports in the files of different Government bu reaus, when compared, have been found to be contradictory. In all such cases efforts were made to ascertain the facts, and the bureau having incorrect information has been notified. The research bureau has access to all source books published by the allied Governments, and is also in direct touch with all United States Government departments of information and research. Direct private telephone and telegraph wires connect the bureau with several of the Government agencies and bureaus, and personal representatives of the Division of Foreign Exchange are stationed with others. The division also has personal representatives in all of the cable censorship offices in the country. The representative of the division in the New York office of the cable censor is also the head of the financial division of the censorship, and he is called into conference in the Division of Foreign Exchange daily. In addition to these regular connections, consultation has been had, when necessary, with the Shipping Board, the War Industries Board, the War Trade Board, and the Departments of State and Treasury; also with representatives of foreign governments. With these connections the research bureau has been in position at all times to obtain immediately the latest information bearing on persons or institutions in all parts pi the world whose transactions have been brought before it. The administrative department has thus been enabled to make prompt decisions on important financial Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. 49 transactions in all cases except where further research was necessary before suspected parties could be cleared or proved to have enemy connections or interest. The information received from all other governmental depart ments is brought together in the research bureau of the Division of Foreign Exchange and filed. Under this system it has been possible to stop many transactions which might have been of value to the enemy and to afford constant protection to bankers and other " dealers " in the United States who might otherwise have inadver tently carried out transactions for enemy account. It has also been possible to turn over many cases to the Alien Property Custodian. When cablegrams are suppressed, it is essential, if such suppres sion is to be effective, that their confirmations also be suppressed, and all confirmations of cablegrams from " dealers " in the United States have been censored through the research department. Such con firmations have averaged about 2,000 a day. Under the regulations " dealers " in the United States are obliged to apply to the director of the Division of Foreign Exchange for approval before they can act upon any confirmations of cablegrams which are received by them and which refer to cablegrams that have never reached them. Copies of all suppressed cablegrams concerning financial matters are delivered to the head of the research bureau each day, and all names of senders, receivers, beneficiaries, or others mentioned in the cablegram are investigated at once. Application is made to the proper department for release of cablegrams before receipt of the confirmations, if it is found that the transactions themselves can not be harmful to the national interest, even though some of those con nected with the transfers may have been of doubtful standing, and the work of obtaining proof in doubtful cases is well under way long before " dealers " receive their confirmations and apply for permis sion to act under them. Through this system it has been found possible to release great numbers of cables covering important trans actions, whose temporary suppression might have been fully justified, but where later investigations showed that their delivery was not incompatible with the interests of the country. The concentration in the research bureau of intercepted letters received from the postal censorship, and intercepted cables from the cable censorship, together with information from the other sources outlined, has been of great value in determining the status of many persons and institutions whose names have come up because of their participation in foreign financial transactions. In cases where those concerned in a cablegram can not be cleared 90-day postponement notices are served on " dealers" applying for permission to consummate the transactions, and if when the time has 100823°—19 4 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

50 AKNUAL REPORT OF THE FEDERAL RESERVE BOARD. elapsed it is still impossible to clear all names, a prohibition notice is issued by the Federal Reserve Board. The activities of the administrative and research departments are indicated by the fact that an average of 400 pieces of mail are handled in the filing room each day, and that more than 40,000 letters of correspondence and 12,000 letters concerning credits or remit tances are on file. Under the Executive order, all foreign correspondents of Ameri can " dealers " are obliged to sign a declaration agreeing not to carry on any business through or for their American correspondents for account or benefit of an enemy or ally of enemy. Such declarations, when received by American " dealers," have been filed with the Di vision of Foreign Exchange, and all names have been researched for the purpose of checking up the standing of the foreign correspond ents of American " dealers " in connection with their attitude toward transactions for account of enemies or allies of enemies. More than 150,000 of such declarations have been received, checked, and filed for ready reference in addition to more than 50,000 declarations of nonenemy interest in securities. A large number of foreign correspondents did not forward declara tions. From intercepted correspondence and reports received from " dealers," it was found that in a large percentage of cases the declara tions were not signed because the foreign correspondents were allies themselves, and seemed to look upon the matter as one not concerning them, apparently not understanding that this requirement has been written into the law of the United States. Steps have been taken to correct this misunderstanding, in order that no injustice may be done to anyone who may have ignored the request of " dealers " for decla rations in good faith, based on the thought that they were not con cerned. Another form of declaration has been required from foreign holders of American securities desiring to collect dividends, interest or maturing principal, or to sell their securities in the United States. In addition to covering the usual statement regarding noninterest of enemies or allies of enemies, this form included the statement that foreign-held securities had not been enemy owned since February, 1917. These declarations are also filed with the Division of Foreign Exchange, and the names of the signers of the declarations are re searched in the same manner as those of the foreign correspondents of American "dealers." This requirement has unquestionably de terred many enemy nationals owning American securities from en deavoring to sell them or collect income upon them. Another regulation which required careful checking in the re search department covered deposits made with American banks in Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. 51 dollars for account of foreign correspondents. Transfers of funds for enemy account could be accomplished so easily through the de posit of money to the credit of foreign correspondents with American banks or other " dealers,55 for account of some neutral cloak in a for eign country, that all such deposits are required to be accompanied with information as to the name of the original party requesting the deposit, the purpose of the deposit, the name of the foreign bene ficiary, and the party for whose account it is to be received in the foreign country. This information has been filed with the Division of Foreign Exchange daily by American " dealers,'5 and the names of all persons concerned are researched for the purpose of uncovering enemy connections or interest, in case of their existence. While there is no doubt that, through the use of cover names and other means, enemy transfers have been constantly made, yet there is every reason to believe that the regulations of the Division of Foreign Exchange have resulted in their being reduced to a minimum, and that any extended operations for enemy account have been made impossible. Through its ambassadors and ministers the State Department has been constantly informed of the operations of American " dealers55 with foreign institutions, where enemies or allies of enemies have been involved. All such operations have been investigated through the research department, after which proper action has been taken by the administrative department. It speaks well for bankers and other " dealers55 in the United States to be able to report that in vestigation has shown conclusively, with few exceptions, that since the United States entered the war there has been no intent or purpose on the part of Americans involved to act contrary to the letter and spirit of the law, nor to carry out transactions which might be of benefit to the enemy. STATISTICAL DEPARTMENT. " Dealers55 holding registration certificates authorizing them to do a fpreign exchange business are required to make weekly reports at the close of business each Wednesday of all their foreign operations, giving balances due them from each country of the world and balances held by them for account of each country of the world. Records of " dealers " registrations are made in the statistical department. On December 1, 1918, 13,653 banks, bankers, exporters and importers, and others had applied for and received registration certificates. Of this total 10,208 are " dealers55 of class A, who are authorized to do a regular foreign exchange business with the public, 2,087 are " dealers55 of class B, under which authority is extended to carry accounts with foreign correspondents, but not to sell, ex change, or deal with the public, and 1,358 are " dealers55 of class C, Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

52 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. who are authorized to carry accounts in the United States for foreign correspondents, but are not authorized to trade with the public. Kegistered " dealers " divided as to Federal Reserve districts are as follows: District. Class A. Class B. Class C. Total. Boston 740 711 376 1,827 New York 984 820 812 2,616 Philadelphia 473 37 20 530 Cleveland 710 23 1 734 Richmond 247 4 2 253 Atlanta 211 8 6 225 Chicago 2,091 315 127 2,533 St. Louis 282 2 264 Minneapolis 2,491 . 161 2,652 Kansas City 742 1 1 744 Dallas 190 3 2 195 San Francisco 1,067 4 9 1,0S0 Total 10,208 2,087 1,358 13,653 It will be noted in the foregoing table that in the Minneapolis, Chicago, and San Francisco districts there are more "dealers" of Class A than in the New York district. This is due to the large number of bankers in small towns who have arranged with their metropolitan correspondents to draw drafts against their foreign accounts over their own names. About 9,500 of the 10,208 Class A " dealers " operate in this manner. This system enables bankers in country districts throughout the United States, as well as in towns and cities, to extend a foreign exchange service to their customers when there is any demand in their localities. Of the Class A " dealers" 708 do a direct foreign exchange business, while 160 of the 708 Class A " dealers " have such an active foreign exchange business that they are required to make reports every week. Of this number the foreign business of 65 is confined to Canada and Mexico, while the other 95 do more or less of a world business. All of these " dealers " are required to make reports to the Division of Foreign Exchange covering their financial foreign exchange opera tions. " Dealers " of the different classes are supplied with forms pre pared especially for their business and from which are assembled in the Division of Foreign Exchange such statistics as are desirable. Banks which transact foreign exchange business through metropoli tan correspondents make their reports through these correspondents. The reports divide the operations into different classes, designed to place before the administrative department a clear statement of developing conditions. The classes of particular interest are those covering exports and imports and arbitrage. While reports of the purchase and sale of demand and cable transfers between " dealers " are interesting in showing the volume, yet as one " dealer " buys and another " dealer" sells, the relationship between the United States Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. 53 and other countries of the world is not changed, as is true when ex ports, imports, and arbitrage transactions are recorded. A number of subclassifications are made, where the amounts in volved are smaller, such as dealings in securities, coupon and divi dend checks, gold and silver shipments, remittances to cover freights and insurance, income taxes, etc., and purchases of exchange for the use of travelers. The causes for the change in balances between the United States and each country of the world as they occur from week to week are clearly defined, and the trend of conditions is readily followed. Bal ances for and against the United States with the other countries of the world have never been made public for reasons which are selfevident. There are certain interesting figures, however, to which ref erence may be properly made. The total purchases and sales of demand and cable exchange be tween " dealers " in the United States from February 20, 1918 (when the Executive order went into effect), to December 31, 1918, were $5,158,943,148, and of this total $3,737,754,469, or 72.45 per cent, were for exchange on Great Britain. Trading in demand and cable exchange between American " dealers " in such large totals shows the free competition which exists in this country in the foreign exchange business, and is most interesting on that account. The total exchange from all sources on all countries of the world purchased by American " dealers " for the same period was $6,603,811,628 and the total sales $6,639,103,540, of which 55 per cent represented dealings in sterling. No other figures would seem to be required to show the relative world financial position which Great Britain holds, but the statement of arbitrage operations is also illuminating in this respect. Ex change on Great Britain w^as sold to the United States by foreign countries to the equivalent of $554,108,000 and exchange on Great Britain was purchased from American " dealers " by foreign coun tries to the total of $480,239,000. Of these amounts British banks supplied the United States with the equivalent of $297,849,000 in pounds sterling against dollars credited to them, which were un doubtedly largely used to pay for imports from the United States to Great Britain, whereas British institutions bought from American banks sterling with dollars to the equivalent of only $109,969,000. Some of these transactions were undoubtedly carried out at the instance of foreign banks in other countries which operated through Great Britain, but proof of this is available only from British rec ords. On balances of sterling exchange bought from and sold to the United States by the whole world, excepting through Great Britain itself, the sale of sterling exchange by the United States ex ceeded the purchase of sterling exchange by the United States by $114,011,000. The principal countries which purchased more ster- Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

54 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. ling exchange from the United States than they sold were France, Greece, Holland, Italy, Spain, East Indies, Straits Settlements, Chile, Colombia, Ecuador, Uruguay, Canada, Central America, and the West Indies. The principal countries selling the United States the greatest amount of sterling exchange on balance were Norway, Por tugal, Sweden, Switzerland, China, India, Japan, Argentina, Brazil, Peru, Africa, and Australasia. While no figures are available prior to the formation of the goldexport committee of the Federal Reserve Board, there is reason to believe, from reports received, that sterling exchange was sold in this market by foreign countries in a large way. Since the embargo, as gold could not be obtained for sterling exchange sold in the United States, such operations have been confined to more natural channels, based on current trade rather than on previously accumulated bal ances. This situation is particularly noticeable in connection with the arbitrage of the exchange of the neutral countries of Europe, which have ruled at a high premium, -and it is found that the United States has obtained a greater total in such exchanges from Great Britain than it has furnished. The relative figures for the period given are as follows: Purchased by! Sold by United States United States from Great j to Great Britain. Britain. Holland guilders.. $6,721,000 $2,947,000 Norwegian kroner 4,392,000 1,738,000 Swedish kroner... 5,379,000 1,349,000 Spanish pesetas.. 13,324,000 914,000 Swiss francs 4,806,000 2,374,000 Instead of our having furnished Great Britain with these highpriced exchanges, Great Britain has actually given us an excess on balance. On the other hand, we have purchased from these countries ex change on Great Britain greatly in excess of our sales of sterling exchange to such countries. It is largely due to this fact that the exchange rates on the neutral countries mentioned ruled against the United States. For instance, during the first three-quarters of the year, Spain sold the United States $12,143,000 in sterling exchange, and purchased from this country $8,531,000 in sterling* exchange, a difference of $3,612,000. This difference affected the rate for Spanish pesetas in the United States, even though, strange as it may seem, such difference was more than offset in the case of Spain by the purchase on balance from Great Britain of the equivalent of $6,593,000 in pesetas, which, of course, affected the rate in the opposite manner. This left an equivalent of $2,981,000 gained by the United States in arbitrage transactions with Spain and Great Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. 55 Britain. In the last quarter of the year Spain sold the United States less sterling than she purchased and increased her purchases on balance from Great Britain, so that the total gain by the United States for the year was $14,146,000. The effect of these particular transactions as a whole, therefore, was favorable to the United States dollar. The two operations are distinct in this respect—in one case American " dealers" purchased from British banks neutral ex changes when they were required to a greater extent than the British banks bought the same exchanges from American banks, while in the other case the banks of neutral countries sold American banks more sterling exchange than they purchased from them. Such trans actions were not based upon the attempt of any " dealers " concerned to advance or depress the exchange on any country, but were under taken because of the relation of demand to supply, and both classes of operations affected the rate for the foreign exchanges in the United States, even though one was carried out in the moneys of the foreign countries and the other in American dollars. By refusing to allow American " dealers" to purchase sterling exchange from other countries, this situation could have been posi tively controlled, but the harm that would have resulted would have been far greater than the good accomplished, and such prohibition would also have been most detrimental to our foreign financial posi tion long after peace had been restored. It is most fortunate, there fore, that it proved possible to meet every emergency without the necessity of having to restrict the arbitrage of exchange. As reports were not filed before the Executive order of the Presi dent of January 26, 1918, it is impossible to determine with certainty exactly what expansion has occurred in the foreign business of the United States, but from the consensus of opinion of many of the principal foreign bankers who have expressed themselves, it would appear as though arbitrage operations, as carried out by bankers and other " dealers " in the United States, before the beginning of the war, August 1, 1914, were practically confined to what were then the three principal commercial countries of Europe, with the occasional purchase, almost entirely through London, of other exchanges, when required for special purposes. Since the war American " dealers " have had arbitrage operations with practically every commercial country, of the world, as shown by figures covering actual transac tions between February 20 and December 31,1918. The total of such transactions shows $876,240,000 in foreign exchanges purchased from other countries by the United States and $689,565,000 in for eign exchanges sold to other countries by the United States. Another phase of our foreign financial transactions which has shown remarkable growth is represented in the activity of the dollar accounts of foreign banking institutions in the United States. Dur- Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

56 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. ing the period referred to, combined debits and credits to such ac counts from European allied countries were $25,993,542,466 (these extraordinary figures were largely due to loans made by the United States Government), from European countries other than those of our allies $2,468,719,572, from Asia $2,802,093,807, South America $1,916,337,532, Central America and Mexico and the West Indies $2,344,246,605, Africa $7,580,068, Australasia $36,915,188. Many of these transactions represent the purchase and sale of securities in the United States for account of foreigners interested in our market. Other large transfers represent payments against shipping docu ments or warehouse receipts, as many foreign countries; have been buying goods in the United States through the payment of dollars which have accumulated here, instead of through sterling, as before the war. The proceeds of exports to the United States from coun tries having balances with American "dealers" have also been credited to accounts in this country. Many of the neutral countries of Europe have used balances which have accumulated here for the purchase of British securities, and in large amounts. Trading in securities in United States markets by foreign interests, both through dollars and foreign moneys, has been large, and for the period covered purchases were made for foreign account to the value of $442,396,000, and sales for foreign account to the value of $355,- 894,000. The excess in purchases was of American, British, and French securities. Securities held in America for foreign account at the close of busi ness December 31, 1918, amounted to $1,824,351,000 and securities held abroad for American account $97,478,000. Commodities held in warehouse in the United States at the close of business September 26,1918, which had been purchased and placed in warehouse for foreign account before July 1, 1918, in many cases extending back almost to the beginning of the war, amounted to $69,258,097, and commodities which had been imported to the United States for foreign account previous to July 1, 1918, but which were still held in warehouse undistributed, either in this country or through reexport, amounted to $31,078,841, or a total of $100,336,938. After the report for the final quarter of the year is received, and the figures for the whole year can be compiled and compared with estimated averages for the first few weeks of the year before the Executive order went into effect, the foreign business of the United States can be analyzed as a whole very completely, and the trend of operations before and since the armistice can be shown, all of which should be of great value in determining whether we are to hold the world-wide financial development made possible by the war. A further analysis of these reports for a few quarters following the signing of the peace treaty should give an even clearer idea of Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

ANNUAL REPOKT OF THE FEDERAL RESERVE BOARD. 57 the part this country is to play in the world's finances during the period of world reconstruction, and possibly afterwards. Before undertaking any operations in foreign exchange with per sons in the United States other than " dealers," it is necessary for such " dealers" to require their customers to sign the following statement: This transaction is made under representation by the undersigned that there is not involved in connection therewith any trading, directly or indirectly, with, to, from, for, or on account, behalf, or benefit of any enemy or ally of enemy, of the United States, or any transaction violative of the trading-with-the-enemy act of the United States. All transactions covered in the reports of " dealers " to the statisti cal department of the Division of Foreign Exchange must have been consummated under the terms of these statements, when the opera tions have developed in this country, or under nonenemy declara tions of foreign correspondents when they have originated outside of the United States. A statement of nonenemy interest, therefore, has had to stand before the creation and at the consummation of every transaction between the United States and every foreign country. COOPERATION WITH THE TREASURY DEPARTMENT. The administrative department has constantly cooperated with the Treasury Department in carrying on foreign-exchange operations, and in the supervision or regulation made necessary to protect the interests of the United States. Many such matters have been handled in conjunction with the Federal Reserve Bank of New York, which has acted, when necessary, for account of all of the Federal Reserve Banks. COMMODITIES. A careful study of the whole world exchange situation, made pos sible through the reports filed with the Division of Foreign Ex change, led to the belief that in view of the restricted shipping facili ties, adjustments in our export trade could be made, which would be most beneficial. As ships available to obtain needed imports could also be used on exports to the same countries from which imports were obtained, it was clear that if the average export cargo exceeded in value the average import cargo, the exchange would begin to turn toward the United States, and that an excess of foreign exchanges would be accumulated that could be made to make purchases for allied account. With the view of developing this situation, an arrangement was made by the director of the Division of Foreign Exchange for meet ings to be held with a representative of the War Industries Board, Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

58 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. a representative of the War Trade Board and the Exports Control Committee of the National Foregin Trade Council. An intensive study was made of the weight and bulk values of such goods as were desired by foreign countries, those of South America being first con sidered. As a result, the War Industries Board agreed to consider requisitions which might be made by the Treasury Department for commodities for export, in the same light as requisitions made by the War Department and the Navy Department to cover their needs. The development of the whole plan was based entirely upon war requirements, and not upon the* expansion of our foreign trade, as it was recognized that the business of the country at the time was to win the war rather than to develop commerce. The cooperation of the committee of the National Foreign Trade Council in this connection was most valuable, and if the armistice had not intervened there is good reason to believe that in a short time the trend of exchange might have turned very materially in favor of the United States in the case of a number of countries where imports for war purposes were required. Even though an armistice has been declared, the work accomplished by this committee, together with the vast amount of data compiled by the War Trade Board, should be most valuable to the country, and should be particularly helpful after peace has been proclaimed and present restrictions upon the world's commerce are removed. FEDERAL RESERVE BANKS. The Federal Reserve Banks of the 12 districts have acted as local agents for the Division of Foreign Exchange in receiving applica tions for registration certificates by banks, bankers, and others who wished to do a foreign exchange business in collecting weekly reports of foreign exchange operations, in passing upon applications of " dealers " for permission to transact business requiring approval, in obtaining reports on institutions and individuals when occasion required, and in carrying out the many special duties growing out of the Executive order and its regulations. This work, which, in the case of many of the Federal Reserve Banks, was very exacting, has been performed most efficiently, and the cooperation of the Federal Reserve Banks has been effective in every particular. Bankers and other " dealers " have at all times manifested a desire to abide by the regulations made by the Division of Foreign Ex change. While it is possible that some " dealers " may have been un willing to undertake operations for enemy account, because of their knowledge that if they did so, and were discovered, they would be prohibited from continuing their foreign exchange business for the period of the war, and while this fact was one of the important safe guards provided the country by the Executive order, yet on the whole Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. 59 the voluntary and patriotic cooperation of " dealers" has been a constant source of satisfaction. The great banking institutions which transact the bulk of our foreign exchange business have cheerfullysubordinated profits to the national interest. BANKS ORGANIZED FOR TRANSACTING FOREIGN BUSINESS AND FOREIGN BRANCHES OF MEMBER BANKS. The foreign trade of the United States, already large, is expected to assume far greater proportions upon the reestablishment of peace. Preparations have already been made for the proper financing of our foreign business. Member banks, by means of foreign branches, and American banking corporations, organized to conduct a foreign busi ness, have reached out into other countries, mainly in Central and South America and the Orient, with a view of competing with Brit ish and continental banks which have long controlled the larger part of their international trade and banking. Under section 25 of the Federal Reserve Act, the stock of Ameri can banking corporations, principally engaged in international or foreign banking, is made eligible for purchase by national banks hav ing capital and surplus of $1,000,000 or more to an amount not ex ceeding 10 per cent of their capital and surplus, if such corporations enter into agreements with the Federal Reserve Board by-means of which the Board can regulate their operations and keep generally informed as to their condition. Up to the present time five such in stitutions have filed agreements defining the operations to be engaged in and relating to the amount and character of their investments, deposits, acceptances, and reserves. The corporations with which agreements have been made are: Capital Resources 'Affiliated and surplus! (head office) institu Branches. Agencies. Dec.31,1918. Dec. 31,1918. tions. American Foreign Banking Corporation, New York City $4,405,000 $22,345,000 Mercantile Bank of the Americas, New York City 4,525,000 24,486,000 2 First National Corporation, Boston, Mass 2,250,000 15,039,000 21 Asia Banking Corporation, New York City 2,500,000 3,780,000 International Banking Corporation, New York City 6,500,000 3 57,957,000 i With more than 20 offices. 2 In New York City. 3 June 30,1918, figores, including branches, $102,322,000. The branches and agencies located in foreign countries are subject to the laws of the country in which located, and in order to be able to compete with local banks, are permitted to follow in general the local banking practice. The American Foreign Banking Corporation, the first to file an agreement with the Board, has acquired or established branches in Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

60 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. the Canal Zone, Panama, and Haiti and the establishment of other branches has been authorized. These branches do a general banking business. The Mercantile Bank of the Americas has expanded through the control of autonomous banks in several of the countries of South and Central America—Brazil, Peru, Venezuela, Nicaragua, and Colom bia. Branches have been opened in Paris and Barcelona and agencies in five of the Latin American countries. In addition to receiving local deposits, making discounts, and dealing in foreign exchange, these affiliated institutions promote trade by bringing together buy ers and sellers acting merely as intermediaries without assuming any market risks themselves. This bank was organized in 1915 by pri vate banking firms in New York, but now numbers among its stock holders several of the large member banks of the Federal Reserve System. The entire stock of the First National Corporation of Boston is owned by the First National Bank of that city. At the present time this corporation has no foreign branches, but intends to establish them as its business develops. An office, doing a purely discount business, is now maintained in New York City. During the past year this corporation has been of considerable assistance in facilitat ing import and export trade with South America, the Far East, and "West Indies, and also with European countries. The Asia Banking Corporation was organized only recently, but plans to engage in a general international and foreign banking busi ness in China, in the insular dependencies of the United States, and, ultimately, in Siberia. It contemplates opening branches in Shang hai, Harbin, Hankow, Tientsin, Peking, and Vladivostok. The stock of this corporation is owned largely by member banks. The International Banking Corporation is the oldest of the bank ing corporations which have filed agreements with the Board, having opened its first branch in Shanghai in 1902. Practically all of the capital stock of this corporation is owned by the National City Bank of New York. Its field of operation covers mainly the Orient— India, China, Japan, the Philippines, and the Malay Archipelago— Central America, and the West Indies, with a branch in London. It also has an office in San Francisco. It is engaged principally in financing the export and import trade centering at the places where its branches are located. At the present time there are only two national banks having foreign branches—the National City Bank of New York and the First National Bank of Boston. The National City Bank has 21 branches in South America, Cuba, Porto Rico, Russia, and Italy, and has also a representative in Copen hagen. The Board has recently authorized it to establish branches Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. 61 in Belgium, Switzerland, Portugal, and Spain. These banks, while branches of an American bank, perform the functions of local banks under authority of local law of the countries in which they are established, and transact a general banking business in their respec tive localities. The First National Bank of Boston has one branch in Buenos Aires, opened in July, 1917. The facilities afforded,by this branch have been devoted mainly to financing our trade in wool and hides with the Argentine. Among the State member banks having foreign branches are the Guaranty Trust Co. of New York, the Equitable Trust Co. <of New York, and the Farmers Loan and Trust Co. of New York, all of which have offices in both England and France, and agencies throughout the world. The Board takes this occasion to renew the recommendation made in its last annual report that section 25 of the Federal Reserve Act be amended so as to provide for the Federal incorporation of bank ing associations engaged solety in international and foreign banking, stock of which is to be owned by national banks and which will oper ate under the control of the Federal Reserve Banks. The language used in section 25 seems to indicate the intention of Congress to permit such banks to be organized under the laws of the United States. Many national banks have become stockholders in banks which have been organized under State laws fo*r the purpose of carrying on a foreign banking business, in accordance with the terms of section 25. The arguments in favor of Federal incorporation are— (a) The dual control exercised by the Federal Reserve Board and by the State banking departments is liable at any time to cause embarrassment, or may operate to restrict the activities of the bank ing corporation. (&) A banking corporation of this description being essentially a national enterprise whose stock is owned by national banks having been authorized by an act of Congress, would seem to be entitled to the benefits and protection of a Federal charter, which would un doubtedly be of great value in competing for business in foreign countries. Attention is called also to the fact that other countries are now devoting particular attention to meeting their demands after the war, as regards financial facilities for trade, and the financing of large overseas contracts. A committee which was appointed some time ago at the instance of the British Board of Trade, recently recommended the establishment of an institution having in view primary objects as follows: Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

62 ANNUAL REPORT OE THE FEDERAL RESERVE BOARD. (a) To afford advice and financial assistance to British commer cial and industrial undertakings from their inception and generally to further the developments of British trade industry and commerce. (5) To make advances for the enlargement of works and the exten sion of plant and for the amalgamation and coordination of works and business with a view to effecting economies in the cost of production. (c) To render financial assistance in connection with transactions involving long periods of credit. (d) To assist in obtaining orders from abroad for British manu facturers and traders and to grant financial facilities for the execu tion of such orders, especially when such orders are intended to be executed in the United Kingdom. (e) To undertake credit operations and to draw and accept bills. (/) To acquaint themselves with the conditions of trade and with the business requirements of all countries of the world and to enter into banking-agency arrangements in such countries with Colonial or British foreign banks or where necessary to open up branches and agencies in such countries. (g) To establish, equip, and maintain information bureaus in close touch with the Department of Commercial Intelligence of the Board of Trade for furnishing British merchants and manufacturers and the business community generally with reliable data and information upon openings for trade, new contracts, State and other loans, and issue proposals, and generally upon all matters relating to foreign trade and business and to undertake the examination of industrial projects. (h) To act as an agent for carrying through overseas commercial and financial transactions in which the British Government may be interested and to receive official recognition and assistance. (i) To undertake trading operations and business on their own account or jointly with others either through the medium of syndi cates or otherwise. There does not seem to be anything to prevent American foreign banks from engaging in the operations above outlined with the pos sible exception of undertaking trading operations in business on their own account or jointly with others in such operations, through the medium of syndicates, but in the opinion of the Board all charters granted to banks engaging in such extensive operations should be uniform, and uniformity can best be assured through a Federal charter. DIVISION OF ANALYSIS AND RESEARCH. At the time of its organization, the Board created a Division of Eeports and Statistics, which has collected and tabulated information from all available sources relating to economic and financial questions. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. 68 Due to the constantly increasing volume of business of the Federal lieserve Banks, this division has necessarily been more and more occu pied in the compilation of figures which relate to the operations of the Federal Reserve Banks rather than to banking questions in general. For some time it has been evident that the work of the statistical division should be supplemented, and that the Board should have some agency to assist it in the work of scientific research. Accordingly, the Division of Analysis and Research was created on September 1, 1918. While much of the work which would ordinarily fall to this division is now being handled in an administrative way by the Divi sion of Foreign Exchange, the active operations of that division will cease when peace has been officially proclaimed. The principal work which has been carried on by the Division of Analysis and Research since its inception is— (a) Collection, classification, analysis, and interpretation of regu lar data relating to the condition of the Federal Reserve System, in cluding both Federal Reserve Banks and member banks, and to busi ness and other conditions affecting the banking and business situation, such work, however, not superseding or taking over that done by the Division of Reports and Statistics. (5) Planning and outlining of inquiries into banking, financial, and other conditions, such inquiries being intended to throw light upon the general management and administration of the Federal Re serve System. (<?) Undertaking of special inquiries on topics referred by the Board to the division for special investigation and report. (d) Preparation of data for the Federal Reserve Bulletin and making provision for collecting additional material from outside sources. (e) Compilation of statistics showing changes in business condi tions and in volume of production. The headquarters of the division are at the offices of the Board at Washington, but a working office is maintained in New York. Its work is supervised by Dr. H. Parker Willis, formerly secretary of the Board, as director. The director has, been able to obtain the assistance of graduate students in economics and finance, to whom a nominal compensation is paid. The work at present is on a comparatively small scale, and may be regarded merely as a nucleus of what may eventually be undertaken by the division. The total cost of the division, including the Board's business index reporting system, is less than $1,300 per month. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

64 ANNUAL, REPORT OF THE FEDERAL RESERVE BOARD. The Board does not contemplate any rapid expansion of the work of the division, believing that it should be developed gradually as the results obtained appear to justify the effort and cost. NEW BANKING STATISTICS. Through its Division of Reports and Statistics, the Board has added to its statistical information by procuring, each week, figures showing the more important items on the balance sheets of member banks in leading centers throughout the country. It is also securing through various clearing house associations, figures which are pub lished every week showing the total of checks paid by clearing house members. The Board believes that the balances as reported by the clearing house associations do not always furnish a true index of banking conditions, while the aggregate of checks paid, including a separate statement of customers' checks, and those drawn by banks and bankers, will, it is thought, portray more accurately the trend of business and will furnish a better basis for comparison month by month and year by year. CAPITAL ISSUES COMMITTEE. In his annual report to Congress for the year 1917, the Secretary of the Treasury referred to the importance of avoiding unnecessary capital expenditures in both public and private enterprises. While no specific authority had been conferred upon the Secretary or upon the Federal Reserve Board to-approve or disapprove new undertak ings, a number of corporation executives, bankers, and municipal officials submitted plans for new enterprises, and thereupon the Sec retary of the Treasury requested that all persons contemplating offer ings of securities for sale or subscription, first submit them for an expression of opinion as to the compatibility of the proposed issues with the national interest. Tentative offerings increased to such an extent that it became evident that an organization of some kind would be necessary to pass upon them, and in a letter dated Janu ary 11, 1918, Secretary McAdoo requested the Federal Reserve Board " as another patriotic service, to assume the responsibility of passing upon such proposals as may be submitted, both in respect to capital expenditures or issues of new securities." The Board appointed Messrs. Paul M. Warburg, chairman, Fred erick A. Delano, and Charles S. Hamlin a committee of its members to undertake the work. The committee enlisted the services of a voluntary advisory committee to assist in its work. This advisory committee consisted of the following: Allen B. Forbes, chairman, senior partner of Harris, Forbes & Co., New York; Frederick H. Goff, president Cleveland Trust Co., Cleveland, Ohio; Henry C. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

ANNUAL. REPORT OF THE FEDERAL RESERVE BOARD. 65 Flower, president Fidelity Trust Co., Kansas City, Mo.; Stephen L. Selden, executive secretary; James Q. Newton, assistant executive secretary; Bradley W. Palmer, counsel. To complete its organiza tion for nation-wide work, the committee appointed in each Federal Eeserve district an auxiliary committee of five members, including the Federal Eeserve agent acting as chairman, and the governor of the Federal Reserve Bank. Members of the advisory committee and all auxiliary committees served without compensation. In beginning its work on February 1, 1918, the committee an nounced that, for the time being, it would undertake to pass upon industrial and public utility issues of not less than $500,000 and municipal issues of $250,000 and over. Subsequently, it reduced the minimum for both classes to $100,000, pointing out that the com mittee earnestly invited the cooperation of everyone in reducing and eliminating issues of even smaller amounts for purposes incompatible with the national interest. The test applied to security issues was (1) whether the offer was timely with respect to the financial operations to be undertaken by the Government and (2) whether the objects for which the funds were to be raised by the sale of securities were compatible with the public interest. The committee in no instance undertook to pass upon the security or legality of issues. Notwithstanding its purely voluntary nature and the absence of specific legal authority, the committee, by reason of the hearty co operation of other governmental agencies and of bankers' associations, as well as of leading stock exchanges, was able, during its brief ex istence, to effect a considerable stoppage of nonessential security issues. The following is a record of issues actually considered: Municipal. u P t u il M iti i e c s . Industrial. Total. Amount considered $86,878,512 $172,069,605 $219,510,269 $478,458,386 Amount disapproved 19,791,665 6,000,000 39,900,000 65,691,665 Aggregate approved 67,086,847 166,069,605 179,610,269 412,766,721 Less "refunding" 21,392,312 125,860,284 111,411,900 258,664,496 Aggregate new issues 45,694,534 40,209,321 68,198,369 154,102,224 New issues last year, same period 108,952,865 107,504,075 287,754,684 504,211,624 Analysis of new issues approved: Amount original applications 65,486,199 46,209,321 108,098,369 219,793.889 Amount approved 45,694,534 40,209,321 68,198,369 154,102;224 Curtailment effected 19,791,665 6,000,000 39,900,000 65,691,665 Analysis of applications formally discouraged: Number 8 3 6 17 Amount $8,915,000 $7,360,000 $3,590,000 $19,865,000 In addition to these tangible results, it is safe to assume that the committee's existence and the campaign of education conducted by it stopped at the source a great many commitments for capital ex- 100823°—19 5 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

66 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. penditures, thereby conserving material, labor, and credit for essen tial industries and use of the Government. Article II of the War Finance Corporation act of April 5, 1918, provided for the appointment of a Capital Issues Committee by the President, and the committee which was appointed in accordance with the terms of the act automatically superseded the voluntary committee of the Federal Eeserve Board. The new committee adopted the general plan of organization which had been followed by the old committee, and appointed local committees in each Federal Reserve district to perform their functions through the Federal Eeserve Bank's organization in each district. LAW DIVISION. In the exercise of its functions, the Board is called upon to con sider many intricate legal problems which frequently involve the interpretation of State as well as Federal laws. Subject to the pro visions of the Federal Eeserve Act and the regulations of the Board, State banks and trust companies becoming members of the Federal Eeserve System retain their full charter and statutory rights as such and continue to exercise all corporate powers granted to them by the States in which they are created. There is lack of uniformity both in the powers vested in State banking corporations and in the laws regulating the operations of such corporations. The law division of the Federal Eeserve Board is therefore called upon to analyze carefully many of the laws of the 48 States which affect banking operations; to pass upon the legality of many banking operations under State and Federal law; to prepare legal papers, and in general, to render various legal services to the Federal Eeserve Board and the several Federal Eeserve Banks. While each Federal Eeserve Bank has its own counsel, it is, of course, important that rulings on legal questions should be uniform in all districts and the general counsel of the Board, therefore, acts in close cooperation with the counsel for the several Federal Eeserve Banks. In addition to the normal or routine work of the legal division every effort has been and is being made to cooperate with the several State authorities and with the various agencies interested in bringing about a standardization of banking laws and a coordination of bank ing powers, and this has involved much work in connection with both State and Federal legislation. The activities of the law division may be briefly summarized as follows: FEDERAL LEGISLATION. The Federal Eeserve Act, since its passage, has been amended in many particulars by the acts of August 4, 1914, August 15, 1914, Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. 67 March 3, 1915, September 7, 1916, June 21, 1917, and September 26, 1918. Most of these amendments were enacted by Congress upon the recommendation of the Federal Eeserve Board, and the law division assisted in the preparation of the amendments. In addition to the foregoing amendments, the Federal Reserve Act has been modified or amended by provisions incorporated in other acts. Following the passage of these amendments there is compiled by the law division under direction of the Board, a new edition of the Federal Eeserve Act with an appendix containing extracts from other acts of Congress which amend the Federal Reserve Act or affect the operation of Federal Reserve Banks or member banks, all fully indexed. STATE LEGISLATION. It is obviously important that there should be maintained in the office of general counsel a proper analysis of State laws affecting the operations of member banks and a record of all banking laws passed by the several States. Member banks, other than national banks, are subject to the laws of the 48 States, and these laws have been made applicable to the operations of national banks in certain particulars; for example, in the exercise of fiduciary powers. There has been prepared by this division and published in the Federal Reserve Bulletin, an analysis of the State laws relating to re serve requirements, an analysis of State laws relating to bank accept ances, and an analysis of State laws affecting the operations of for eign banking corporations. This information is of great importance at the present time since our member banks are now authorized to es tablish-and maintain branches in foreign countries or to subscribe to stock in banks engaged principally in the business of international or foreign banking. As our foreign trade develops it may reason ably be expected that foreign banks will desire to increase their activities in this country. As many of the State laws impose re strictions on the operations of foreign banks, it is important that this subject should be given careful consideration by those interested in the standardization of such laws. The law division is also engaged in the preparation of an analysis of State laws relating to capital and surplus requirements, which will be published at an early date, and an analysis of State laws relating to limitations on loans. It endeavors, through the counsel for the several Federal Reserve Banks and through the superintendents of banks of the several States to fcpp.n rm flip mnip.s rvf nil q.r*t.s rmssprl hv Mta+.p. lpon«lnfnr*A« wTur»"h Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

68 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. In an effort to assist in bringing about a standardization of State banking laws and a coordination of Federal and State banking powers, certain Federal legislation to this end has been recommended and an analysis of the several State laws has been made to show what legislation is necessary on the part of the State legislatures to enable State banks which become members of the Federal Eeserve System to conduct their operations on a basis of substantial equality with other member banks. This analysis, with a standard form of enabling act, was prepared at the request of the president of the American Bankers' Association, and with slight modifications has been adopted by that association in its program of legislation for the year 1919. As 44 State legislatures meet during the current year, it is hoped that many of the States will adopt the necessary legislation to remove any inequalities that may exist by reason of the conflict in State and Federal laws. REGULATIONS. The law division is called upon to assist in the preparation of all regulations of the Board in order that they shall in all cases con form legally to the letter and spirit of the Federal Eeserve Act. OPINIONS. As previously stated, this division is required to pass upon questions involving the interpretation of the Federal Reserve Act, the national bank act, the negotiable instruments law, and the laws of the several States which affect the operation of national banks, State banks, or trust companies which are members of the Federal Eeserve System. INFORMAL RULINGS. Eulings which involve the application of regulations of the Board or of provisions of the Federal Eeserve Act, to concrete questions arising in the administration of the act, are usually referred to this division before being published or formally entered so that there may be no question of their legality. CLAYTON ACT. Under the Kern amendment to the Clayton Act, the Board is authorized under certain conditions to permit the same person to serve as an officer or director of two or more banking institutions which are not in substantial competition. Applications for this per mission are filed on regular forms prepared by the Board, and in each case are referred to this division to ascertain whether the application is in proper form; whether it contains data sufficient to enable the Board to pass upon the question presented, and it is Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. 69 usually necessary for this division to conduct correspondence and to prepare various memoranda in connection with such application. The national-bank examiners report all cases where the same person is serving with two or more banking institutions in apparent viola tion of the Clayton Act. Such cases are referred to this division w^hich must determine— (a) Whether a permit has been granted by the Board; - (b) If not, what is the capital and surplus of the banks involved; (c) What is the population of the place in which the banks are located according to the 1910 census; (d) Whether the banks involved are member banks. A report is then made to the Board with a recommendation as to the action to be taken. More than 2,000 cases have been passed upon by the counsel's office and a list of applications granted and refused comprises more than 143 pages of typewritten matter. STATE BANK APPLICATIONS FOE MEMBERSHIP. The Board has approved more than 650 applications of State banks for membership in the Federal Reserve System during the past year. Each of such applications is first submitted to this division and in each case it is necessary— (1) To ascertain if the application and exhibits are executed in proper form; (2) Whether all necessary exhibits accompany the application; (3) To examine and make a certificate as to the legality of sug gested conditions of membership; (4) To examine State laws to ascertain (a) whether the bank has any unusual powers, and prepare memorandum on this subject, and (b) whether the bank has power to join the system; (5) To ascertain whether the bank has the necessary capital stock; (6) To examine the charter or articles of incorporation; (7) To prepare memoranda regarding any unusual or doubtful cases and to call to the attention of the Board any irregularities; (8) It is also necessary to prepare numerous letters in connection with these applications calling for additional information. APPLICATIONS FOR TEUST POWERS. Since the passage of the act of September 26, 1918, which amended section 11 (k) of the Federal Reserve Act, there has been a consider able increase in the number of applications filed by national banks for permission to exercise trust powers. In each case it is necessary for this division— (1) To ascertain whether the application is executed in proper form; Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

70 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. (2) Whether the bank has the necessary capital and surplus re quired by the State law; (3) Whether the State law gives competing institutions the powers applied for; (4) To prepare a report in each case for the Federal Reserve Board. The amendment referred to makes various State laws applicable to the operations of national banks exercising trust powers. It is therefore necessary for this division to maintain a careful analysis of all the laws of the State relating to the exercise of fiduciary powers by competing State corporations and to pass upon a very large number of questions arising in connection with the exercise of trust powers. There is now in course of preparation a new series of regulations governing the exercise of these powers by national banks in accord ance with the act as amended. ACCEPTANCES. A very large number of questions have arisen in connection with the use of bank credit in the form of acceptances. This being a new power vested in national banks by the Federal Reserve Act, it is nec essary to carefully supervise its exercise to the end that a proper dis count market may be developed along conservative lines, and in order that this power may not be used for the purpose of evading limitations or restrictions imposed upon the credit operations of na tional and member banks. COMPTROLLER OF THE CURRENCY. To avoid any possible conflict which may result in cases where the jurisdiction of the Comptroller of the Currency and the Federal Reserve Board is seemingly concurrent, the general counsel of the Federal Reserve Board acts in such cases as joint counsel for the Board and the Comptroller. The law division of the Board is there fore required to pass upon a number of questions arising in connection with the operations of national banks. FOREIGN EXCHANGE TRANSACTIONS. Under the trading with the enemy act, the President was author ized to use any agency or agencies that he might select to control for eign exchange transactions and to prevent the resources of this coun try from being used for enemy purposes. The Federal Reserve Board was designated by Executive order of January 26, 1918, as the agency of the Secretary of the Treasury to exercise proper super vision over all such transactions. All persons carrying accounts either with or for foreign correspondents or engaging in any manner Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. 71 in transactions in foreign exchange or transfers of credits as between the United States and any foreign country were required to obtain a registration certificate from the Federal Reserve Board and to make regular reports of all such transactions. In each case a certifi cate of nonenemy interests was required, and whenever it appeared that the consummation of the transaction would not be compatible with the best interests of the United States its consummation was ordered suspended by the Federal Reserve Board, pending investiga tion. The law division was accordingly called upon to prepare vari ous regulations and rulings and to pass upon a number of intricate questions of Federal law and international law in connection with the exercise of these functions. FIDUCIARY POWERS. Section 11 (k) of the Federal Reserve Act authorizes the Federal Reserve Board " to grant by special permit to national banks apply ing therefor, when not in contravention of State or local law, the right to act as trustee, executor, administrator, and register of stocks and bonds under such rules and regulations as the said Board may prescribe." In its last annual report the Board called attention to the decision of the Supreme Court of the United States, in the case of Bank v. Fellows, which sustained the right of Congress to grant fiduciary powers to national banks and to vest in such banks any powers en joyed by competing State corporations. In the course of its opinion the court indicated that the purpose of Congress in providing that fiduciary powers might be granted to national banks " when not in contravention of State or local law " was to bring about a more thorough coordination of banking powers as between Federal and State institutions. In order to remove any question of the power of the Board to accomplish this result by regulation an amendment to the act was recommended which was designed to make national banks exercis ing fiduciary powers subject to State laws in so far as those laws pro vided appropriate safeguards for the protection of beneficiaries of trust estates. The amendment suggested by the Board with some modifications was included in the act which was approved and became a law on September 26,1918. Under the act as amended the fiduciary powers which may be granted by the Board have been enlarged so as to include authority to act as guardian of estates, assignee, receiver, committee of estates of lunatics, or in any other fiduciary capacity in which State banks, trust companies, or other corporations which come into competition with national banks are permitted to act. under the laws of the State in which the national bank is located. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

72 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. The Board is authorized to grant permits to national banks, to exercise fiduciary powers in any case in which competing State cor porations are permitted to exercise these powers, even though the laws of the State expressly or impliedly prohibit the exercise of such powers by a national bank. Indications are that a great many of the national banks will apply for and obtain these permits and will thus be enabled to afford additional facilities to their customers and to increase the scope of their operations. During the year 1918, up to September 26, the Board had granted 89 original permits and 1 supplemental permit. It has granted since that time 49 original permits and 44 supplemental permits. Original permits issued during the year number 138, the total num ber of banks now holding original permits being 708. A list of the banks to which permits have been granted appears m the appendix. RESERVE AND CENTRAL RESERVE CITIES. The Board is authorized and empowered by section 11 of the Fed eral Reserve Act to add to the number of cities classified as reserve and central reserve cities in which national banking associations are subject to special reserve requirements, and to reclassify existing reserve cities or to terminate their designation as such. The law as amended by the act of June 21, 1917, requires all re serves of member banks to be carried with the Federal Reserve Banks of their respective districts. The requirement as to time de posits is the same with all classes of banks—3 per cent; while on demand deposits banks in central reserve cities are required to carry a reserve of 13 per cent, those in reserve cities 10 per cent, and banks in other towns and cities 7 per cent. It has been the policy of the Board in permitting the establish ment of branch banks to classify cities in which the branches are located as reserve cities, and in accordance with this policy the Board has designated Jacksonville, Fla., El Paso, Tex., and Little Rock, Ark., as reserve cities. The other branches established during the year are in cities which were already classified as reserve cities. BRANCHES OF FEDERAL RESERVE BANKS. There were in operation at the close of the year 1917 six branches of Federal Reserve Banks, as follows: Location. Established by— New Orleans Federal Reserve Bank of Atlanta. Louisville...' Federal Reserve Bank of St. Louis. Omaha Federal Reserve Bank of Kansas City. Portland Federal Reserve Bank of San Francisco. Seattle Do. Spokane Do. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

ANNUAL REPORT OF THE FEDERAL, RESERVE BOARD. 73 During the year 1918, the following branches, which were au thorized by the Board during the year 1917, were opened for business: Location. Established by— Cincinnati Federal Reserve Bank of Cleveland. Pittsburgh Do. Detroit Federal Reserve Bank of Chicago. Baltimore Federal Reserve Bank of Richmond. Denver Federal Reserve Bank of Kansas City. During the year covered by this report the Board authorized branches as follows: Location. Established by— Federal Reserve Bank of Atlanta. Jacksonville Do. Memphis Federal Reserve Bank of St. Louis. Little Rock Do. El Paso Federal Reserve Bank of Dallas. Salt Lake City Federal Reserve Bank of San Francisco. These branches have all been in operation for several months, with the exception of that at Little Rock, which began business on Janu ary 6, 1919. "While section 3 of the Federal Reserve Act as amended June 21, 1917, authorizes the Federal Reserve Board to " permit or require " any Federal Reserve Bank to establish branch banks within its dis trict, it is the policy of the Board to have negotiations for branch banks originate between the community applying and the Federal Reserve Bank, and to review only such cases as may be referred to it after consideration by the directors of the Federal Reserve Banks. All of the branches have proved a great convenience to the com munities served, and have tended to arouse a greater local interest in the Federal Reserve System. Many of them have justified their existence from the standpoint of earnings, while others recently established have not yet had an opportunity of demonstrating their ability to sustain themselves. In some cases the establishment of branches has been followed by accession to membership of a number of State banks in the localities served, and the usefulness of the branches has been greatly increased as a result. The by-laws governing the branches are approved by the Federal Reserve Board, and are uniform as far as recognition of the control and responsibility of the Federal Reserve Banks is concerned, but differ in some districts as to matters of administrative detail. In some cases the branch is empowered to make rediscounts for the mem ber banks assigned to it, while in others the actual rediscounting operation is performed at the head office, the member banks being given credit at the branch as of the date on which the paper is ten- Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

74 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. dered to the branch. In one case the earnings growing out of redis counts are shown on the books of the branch, while in the other they appear only on the books of the Federal Reserve Bank; consequently a comparative statement of the earnings of the various branches can not be given. Clearing operations and the collection of country checks are en gaged in by the branch banks, and the head offices are relieved of a corresponding amount of detail work. It is apparent, however, that too great a number of branches in any one district involving a division of the funds of the Federal Eeserve Bank will tend to impair the effective control of the bank over its resources, and this fact, together with the expense involved in the operation of branch banks, will make it impossible to gratify the civic pride of many cities desiring branches. There are, unavoidably, some advantages enjoyed by member banks located in Federal Eeserve or branch bank cities which are not shared by banks in other towns and cities, but the Board is endeavor ing, as far as possible, to give equal facilities to all member banks, and has, therefore, authorized the Federal Reserve Banks to pay all charges on shipments of currency to or from member banks. A mem ber bank, therefore, located at a distance from its Federal Reserve Bank, is thus put in as favorable a position with respect to currency transfers as a member bank located in the Federal Reserve city, with the exception of the time involved in transit. CHECK CLEARING AND COLLECTION. The member banks are availing themselves more and more of the clearing and collection facilities afforded by the Federal Reserve System. The daily average number of transit items handled by the reserve banks during the year 1917 was approximately 276,000, amounting to $190,000,000. For the 30-day period ended June 15, 1918, the daily average number of items handled was 485,600, an increase of over 80 per cent, amounting to $385,060,000, an increase of over 100 per cent. From October 15 to November 15, 1918, the daily average number of items handled was 828,000, an increase over June 15 of 70 per cent, amounting to $556,943,000, an increase of 45 per cent. On November 15, 1917, the number of member banks was 7,826, and the number of nonmember banks on the par list was 9,210, a total of 17,036. On December 15,1918, the number of member banks was 8,612, and the number of nonmember banks on the par list was 10,409, a total of 19,021, showing an increase for the 12 months of 1,985 in the number of banks remitting at par. Assuming the total number of banks in the United States to be about 29,000, the number clearing through the Federal Reserve col- Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. 75 lection system by districts is shown approximately in the following table: Remitting at par. Nonmember banks not remit ting at par Member Nonmem- (approxi banks. ber banks. mate). Boston . 423 246 New York... . 723 339 Philadelphia 661 329 io2 Cleveland 814 728 411 Richmond 565 351 1,156 Atlanta 426 209 1,345 Chicago 1,334 2,392 1,805 St. Louis 514 1,046 1,600 Minneapolis 867 1,169 1,743 Kansas City •. 994 2,200 979 Dallas 727 247 947 San Francisco 644 1,049 159 Total 8,692 10,305 10,247 It appears, therefore, that there are something over 10,000 banks which do not remit at par. Classifying these banks according to their deposits, the approximate total of nonremitting banks in each district appears as follows: a $1 n , d 0 0 o 0 v ,0 e 0 r 0 . $ $ 2 1 5 ,0 0 0 ,0 0 0 ,0 0 0 t 0 o . $1 $ 0 2 0 5 , 0 0 , 0 0 0 0 0 t . o L $ e 1 s 0 s 0 , t 0 h 0 a 0 n . (a T pp o r t o al x i mate). Boston New York Philadelphia 17 45 18 7 87 Cleveland 27 127 171 66 391 Richmond 42 275 411 316 1,044 Atlanta 37 250 460 528 1,275 Chicago 41 453 746 325 1,565 15 239 546 612 1,412 Minneapolis 6 161 463 303 933 Kansas City 3 270 779 665 1,717 Dallas 13 114 303 369 799 San Francisco. 7 31 63 47 148 Total 208 1,965 3,960 3,238 19,371 1 Many nonremitting banks do not report their deposits. At a conference of Federal Reserve agents which was held in Washington on December 7, the conclusion was reached that every effort should be made to increase the number of banks on the par* list. The banks and the public need a system that is able to collect all items. At the present time, although checks on two-thirds of the banks can be collected at par, and these banks represent perhaps 90 per cent of the banking resources of the country, the number of banks which will not remit at par, in which are included some of substantial size and located in important cities, is sufficiently large to make many banks hesitate to use the Federal Reserve collection system because of the number of items which can not be handled by the Federal Reserve Banks. Whenever the number of nonremitting banks can Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

76 ANNUAL REPORT OF THE FEDERAL, RESERVE BOARD. fee reduced by one-half, or to five or six thousand, the collection sys tem in many districts at least would be almost universally used and the Board could feel that the principle of par collections had been established beyond question. The par list has shown a steady growth, but a continuous effort will be made through correspondence and per sonal solicitation to make further substantial additions to it. The par collection system is not a local or selfish undertaking for the benefit of member banks, but is a national enterprise for the conven ience of the public and the promotion of commerce, and concen trated and persistent efforts will be made to make the par list com plete. While the additions to the par list account in part for tne large increase in the number of transit items handled, it is evident that the remarkable increase in the volume of transactions has been oc casioned primarily by the greater use of the facilities of the system by all member banks. There have been only a few additions to the number of nonmember banks maintaining clearing accounts with the Federal Reserve Banks as permitted under section 13 of the act as amended June 21, 1917, and little, if any, of the increase shown is due to their cooperation. The opinion of the Attorney General of the United States was asked as to the applicability to nonmember banks of the provision contained in the amendment to section 13 enacted in June, 1917, that member or nonmember banks " may make a reasonable charge to be determined and regulated by the Federal Reserve Board, but in no case to exceed 10 cents per $100 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 expressed the view that the limitations contained in section 13 do not apply to State banks not connected with the Federal Reserve System as members or depositors, but that checks on banks making exchange or collection charges should not be cleared or collected through Federal Reserve Banks. This opinion has restricted the operations of the Federal Reserve Banks to checks which can be collected without the payment of exchange to the bank acting as collecting agent. At the close of the year 1917 the reserve banks were assessing upon member banks a service charge of from nine-tenths of 1 cent to 1^ cents per item, the charge being made to cover cost of postage, stationery, and accounting. Early in 1918 this charge was modified by some of the banks taking 500 checks per month from each member bank free, all checks in excess of that number being subject to the service charge. On July 1 the service charge was abrogated entirely, Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. 77 and the Federal Reserve Banks now collect without charge all checks on members and other banks on the par list. During the month of October, as has already been stated, additional facilities were given member banks and their customers through the absorption by the Federal Reserve Banks of all cost of postage, expressage, insurance, etc., incident to shipments of currency to and from member banks (not including silver and subsidiary coin), also of the cost of telegrams between the Federal Reserve Banks and member banks in connection with currency, exchange transfers, and deposit transactions. Under a similar arrangement for nonmember banks maintaining clearing accounts, the Federal Reserve Banks ab sorbed the cost of postage, insurance, and expressage in connection with shipments of currency in settlement of clearing balances, and a further saving of expense to nonmember banks on the par list is pro vided by inclosing stamped envelopes with collection letters for return remittances. All expenses incident to shipments of currency made in payment of items sent for collection are borne by the Federal Reserve Banks. Since the installation of the leased-wire system connecting all Fed eral Reserve Banks, delays in the transmission of telegraphic trans fers from one section of the country to another have been reduced to a minimum, and the number of such transactions which are con summated daily indicates the member banks' appreciation of the facilities afforded. In some districts there has been an increase in the number of banks taking advantage of the exchange facilities, provided through the medium of Federal Reserve exchange and Federal Reserve transfer drafts. Any member bank may obtain through its Federal Reserve Bank as complete facilities as it could secure by maintaining accounts in each of the 12 Federal Reserve cities, as these drafts are pay able on presentation at any designated Federal Reserve Bank with out deduction for time involved in collection, the settlements be tween the Federal Reserve Banks concerned being made through telegraphic transfers. ISSUES OF FEDERAL RESERVE BANK NOTES. The act approved April 23, 1918, known as the Pittman Act, the short title of which is "An act to conserve the gold supply of the United States; to permit the settlement in silver of trade balances adverse to the United States; to provide silver for subsidiary coinage and for commercial use; to assist foreign Governments at war with the enemies of the United States; and for the above purposes to sta bilize the price and encourage the production of silver," authorizes the Secretary of the Treasury to melt or break up and sell as bullion not more than 350,000,000 of standard silver dollars, and provides that Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

78 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. any silver certificates which may be outstanding against such stand ard silver dollars so melted or broken up shall be retired at the rate of $1 of such certificates for each standard silver dollar melted or broken up, and that sales of bullion shall be made at such price—not less than $1 per ounce of silver 1,000 fine—and upon such terms as shall be prescribed from time to time by the Secretary of the Treasury. The act further provides that the sales of silver bullion may be made for the purpose of conserving the existing stock of gold in the United States, of facilitating settlement in silver of trade balances adverse to the United States, of providing silver for subsidiary coin age and for commercial use, and of assisting foreign Governments at war with the enemies of the United States. In order to prevent con traction of the currency, the Federal Reserve Board is authorized to permit or require the Federal Reserve Banks to issue Federal Re serve bank notes in any denominations, including denominations of $1 and $2, in an aggregate amount not exceeding the amount of standard silver dollars melted or broken up and sold as bullion, upon deposit with the Treasurer of the United States, as security for the bank notes issued, of United States certificates of indebtedness, or of United States one-year gold notes. The Federal Reserve bank notes are taxable at a rate to make the net return on the certificates of indebtedness or the one-year gold notes equal to the net return on United States 2 per cent bonds used to secure Federal Reserve bank notes. The effect of the Pittman Act has been most satisfactory; it has caused no expansion of currency, as the Federal Reserve bank notes which have been issued have merely taken the place of a cor responding amount of silver dollars or silver certificates which had been in circulation and the bullion which has been made available by the melting of the silver dollars has been most effective in reliev ing an acute financial situation with which the British Government was confronted in India, and has also relieved, without the shipment of gold, an adverse exchange situation, which threatened to restrict our importations from the Orient. In the allocation of silver, preference has been given to the re quirements of our own Government and the governments associated with us in the war, although as the supply of silver has become more ample, shipments have been permitted to some extent for commercial purposes. Up to the close of the year, $119,162,760 of Federal Re serve bank notes were issued and put into circulation mainly in denominations of $1 and $2, and exports of silver were authorized by the Board since April 23, amounting to $258,209,000. These issues of Federal Reserve bank notes are of a temporary character and will be retired automatically as the Treasury redeems the certificates of indebtedness or notes securing them, as required Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. 79 by section 6 of the Pittman Act, which provides that " as and when standard silver dollars shall be coined out of bullion purchased under authority of this act, the Federal Reserve Banks shall be required by the Federal Reserve Board to retire Federal Reserve bank notes issued under authority of section 5 of this act, if then outstanding, in an amount equal to the amount of standard silver dollars so coined, and the Secretary of the Treasury shall pay off and cancel any United States certificates of indebtedness deposited as security for Federal Reserve bank notes so retired." AMENDMENTS TO THE FEDERAL RESERVE ACT. The ability of the Federal Reserve System to meet the abnormal conditions incident to the war has been due in a large measure to the liberal attitude and prompt action of Congress in enacting legis lation necessary to make the Federal Reserve Act responsive to these conditions. The acts which have become law since the last annual report of ftie Board, and which amend the provisions of the Federal Reserve Act, or affect the operations of the Federal Reserve Banks or member banks, may be summarized briefly as follows: (1) Section 8 of the act approved April 4, 1918, known as the third Liberty bond act, authorized the Secretary of the Treasury to leave on deposit with banks which subscribed for themselves or for their customers to the third Liberty loan the proceeds of such sub scriptions under certain safeguards and restrictions. This was ob viously necessary to prevent complications which might have resulted from heavy withdrawals of deposits from banks throughout the United States and the concentration of these funds in the Treasury. (2) Section 13 of the act approved April 5, 1918, known as the war finance act, authorized the Federal Reserve Banks to discount direct obligations of member banks secured by bonds of the War Finance Corporation and to use notes so secured, if it becomes neces sary, as a basis for Federal Reserve notes. While the War Finance Corporation did not find it necessary to issue bonds or to obtain credit through the Federal Reserve Banks, this precautionary legis lation unquestionably had a very beneficial effect in stabilizing credits. Section 15 authorized the Federal Reserve Banks to act as fiscal agents and depositaries of the War Finance Corporation, thus plac ing at the disposal of that corporation the facilities of the Federal Reserve System. Section 20 of this act amended section 5202, Revised Statutes, so as to exempt from the liabilities which may be incurred by a national bank those incurred under the provisions of the war finance corpora tion act. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

80 ANNUAL, KEPOKT OF THE FEDERAL, RESERVE BOARD. Section 301 repealed the stamp tax in so far as it applied to prom issory notes secured by bonds or obligations of the United States. This provision of the war finance corporation act aided materially in marketing Liberty bonds. (3) The act approved April 23, 1918, known as the Pittman Act, amended the Federal Reserve Act by authorizing Federal Reserve Banks to issue Federal Reserve bank notes in any denomination in cluding denominations of $1 and $2 against the security of United States certificates of indebtedness or of one-year United States gold notes. This act has been discussed elsewhere in this report. (4) The act of September 24, 1918, entitled " A supplement to the third Liberty bond act," amended section 5200, Revised Statutes. This section limits the amount that may be loaned by any national bank to any one person to 10 per cent of the capital and surplus of the lending bank. Under this amendment loans secured by Liberty bonds were made exempt under certain conditions from this limita tion, thus facilitating to a very great extent the marketing of Liberty bonds. (5) The trading-with-the-enemy act, as amended by the act ap proved September 24, 1918, authorized the President to use any agencies that he might select to control foreign-exchange transac tions. Under authority of this act the Federal Reserve Board was designated to perform these functions as the agency of the Secretary of the Treasury. (6) The act of September 26, 1918, amended sections 4, 11, 16, 19, and 22 of the Federal Reserve Act, and sections 5208 and 5209, Re vised Statutes: (a) The amendment to section 4 of the Federal Reserve Act sim plified the procedure to be followed in the election of directors of Federal Reserve Banks. (&) The amendment to section 11, subsection (&), of the Federal Reserve Act, broadened to some extent the trust or fiduciary powers that may be exercised by national banks; made such operations sub ject to appropriate safeguards and restrictions, and will make it pos sible for national banks to exercise these powers on a basis of sub stantial equality with competing State corporations. (c) The amendment to section 16 of the Federal Reserve Act authorized the issuance of Federal Reserve notes in larger denomina tions than was possible under preexisting laws. (d) The amendment to section 19 of the Federal Reserve Act vested in the Board the power to classify banks in outlying districts of reserve and central reserve cities as banks in reserve or nonreserve cities, thus removing what might have proven an injustice to the smaller banks in the outlying districts of the larger cities or in newly annexed territory of such cities. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

ANNUAL, KEPORT OF THE FEDERAL RESERVE BOARD. 81 (e) The amendment to section 22 of the Federal Reserve Act, which relates to transactions between member banks and their officers or directors, has cleared up the mttfiy ambiguities of that section and has removed what was regarded by many State banks as an obstacle to membership. (/) The amendment to sections 5208 and 5209, Eevised Statutes, which prescribe penalties for false statements made with intent to defraud by officers or directors of national banks, and certain penal ties for embezzlement, abstraction, or willful misapplication of funds on the part of such officers or directors, makes subject to these pen alties officers and directors of Federal Reserve Banks and receivers of national banks. PENDING AMENDMENTS TO THE FEDERAL RESERVE ACT. There is now pending in the House a bill to amend sections 7, 10, 11, and 25 of the Federal Reserve Act, and section 5172 of the Re vised Statutes. A bill has already been passed in the Senate, the provisions of which are substantially similar to those of the House bill, except that it does not include any amendment to sections 10 and 25 of the Federal Reserve Act. The purpose of the proposed amendments included in these bills may be summarized briefly as follows: AMENDMENT TO SECTION 7. Section 7 of the Federal Reserve Act now provides that the net earnings of the Federal Reserve Banks, after paying expenses and cumulative dividends, shall be paid to the United States as a fran chise tax, except that one-half of such net earnings shall be paid into a surplus fund until that fund amounts to 40 per cent of the paid-in capital. The amendment to section 7 provides that all net earnings shall be paid into a surplus fund until that fund amounts to 100 per cent of the subscribed capital of the Federal Reserve Bank and that there after 10 per cent of said net earnings shall be paid into this fund. The Federal Reserve Banks are not subject to the same restrictions as are imposed upon national banks regarding liabilities that may be incurred. National banks are not permitted to become liable for borrowed money (except to Federal Reserve Banks and to the War Finance Corporation) in an amount greater than their capital stock, nor can they issue and put in circulation national bank notes in excess of this amount. In order to give greater elasticity to their operations, Federal Re serve Banks were not made subject to these restrictions. It is there- 100823°—19 6 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

82 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. fore of very great importance to the United States as well as to the banks, that a large surplus should be created for the protection of outstanding liabilities. Fedeuil Eeserve notes issued through Fed eral Reserve Banks and for which they are ultimately liable are ob ligations of the United States. The net earnings of the Federal Reserve Banks, which are paid to the Government under existing laws as a franchise tax, are used either to supplement the gold reserve held against outstanding United States notes, or to reduce the outstanding bonded indebted ness of the United States. The law provides that should a Federal Reserve Bank be dissolved or go into liquidation, any surplus remain ing after the payment of all debts, dividend requirements, and the par value of the stock, shall be paid to and become the property of the United States. It is obvious, therefore, that if these earnings are carried into the surplus account of the Federal Reserve Banks they will accomplish substantially the purpose for which they are now used, since they will protect the credit of the United States, AMENDMENT TO SECTION 10. Section 10 now makes members of the Federal Reserve Board in eligible during the time that they are in office and for two years thereafter, to serve as officers or directors of member banks. The proposed amendment is designed to make the members in eligible during the time they are in office and during the period for which they are appointed, but will not disqualify them after they have served their full term. AMENDMENT TO SECTION 11. Federal Reserve Banks are now prohibited from rediscounting for a member bank notes bearing the signature or indorsement of any one borrower in an amount in excess of 10 per cent of the capital and surplus of the member bank. By recent amendment to the national bank act, national banks under regulations prescribed by the Comptroller of the Currency, with the approval of the Secretary of the Treasury, are permitted to lend to one person, an amount in excess of 10 per cent of their capital and surplus, provided such loans are secured by United States bonds or certificates of indebtedness issued after April 24, 1917. In view of the limitations contained in sections 9 and 13 of the Federal Reserve Act, national banks and other member banks which, in the interest of the Government, have made loans to customers in excess of 10 per cent of their capital and surplus, upon the security of Liberty bonds, are now unable to rediscount the notes taken with Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

ANNUAL, REPORT OF THE FEDERAL, RESERVE BOARD. 83 tke Federal Reserve Banks. In justice to the member banks, there fore, it is important that this amendment to section 11 should be adopted, which will permit the Federal Reserve Board, when neces sary, to suspend the limitations of the sections above referred to. AMENDMENT TO SECTION 25. The Board has, on previous occasions, recommended to Congress that the Federal Reserve Act be amended so as to permit national banks under certain conditions to establish branches. The proposed amendment to section 25 which has been incorporated in the House bill but not in the Senate bill, authorizes national banks located in a city of more than 100,000 inhabitants and having a capital and surplus of $1,000,000 or more, to establish branches not to exceed 10 in number within the corporate limits of the city or town in which it is located, provided the State laws extend a similar privilege to competing State corporations. As the law now stands national banks are at a serious disadvantage in meeting the competition of State banks with branches. In the opinion of the Board the proper development of the Federal Reserve System makes it necessary to coordinate as far as possible the powers of all member banks. Under existing laws, State banks and trust companies in many cases are permitted to operate branches even after conversion into national banks, with the result that some member banks, both national and State, are given advantage over other member banks. The Board therefore renews its recommendation that this amend ment be adopted, being confident that it will prove beneficial to the Federal Reserve System, as well as to the communities concerned. AMENDMENT TO SECTION 5172, R. S. A bill identical in form with this amendment has already passed the House and the Senate. In the Senate, however, it was passed as an independent bill, while in the House it was a part of a bill which dealt with other subjects. In these circumstances it has not become a law. Under the present law, national bank notes must be delivered to member banks registered and countersigned in blank and are pre sumably signed by the officers of the issuing bank. The law makes such notes, however, subject to redemption by a national bank, whether issued and placed in circulation without signatures or with forged or fraudulent signatures. The actual signing of the note is therefore not a necessary incident to its validity. This amendment permits the signatures to be engraved on the notes before they are delivered to the banks. If adopted, considerable expense will be avoided and the distribution of the notes will be expedited. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

84 A:N:NUAL KEPORT OF THE FEDERAL, RESERVE BOARD. FEDERAL ADVISORY COUNCIL. The Federal Advisory Council during the year held four meetings at Washington, as required by section 12 of the Federal Reserve Act. It is the practice of the Board, in advance of each meeting, to fur nish the council with a list of topics suggested for discussion, and to hold a joint session with the council at the beginning and close of each meeting. At the opening session the Board's viewpoint is out lined and at the closing session the council submits a written report giving its opinions and conclusions regarding the questions brought to its attention by the Board, and makes, at the same time, such inde pendent suggestions or recommendations as it may deem proper. These meetings are of constantly increasing interest and value, for they give the Board the advantage of the views of leading bankers from all sections of the country, and at the same time enable the Board to make clear to these representative bankers its own attitude on various banking and financial problems. The statute requires that these meetings be held not less than four times each year, and oftener if called by the Federal Reserve Board. The council is also empowered to hold additional meetings whenever it may deem it necessary, either in Washington or elsewhere. So far additional meetings have not been deemed necessary, but the Board will not hesitate to call the council together whenever, in the consideration of the problems incident to the readjustment period which the country is entering, such action should seem advisable. The members of the Federal Advisory Council inform the Board at each meeting of financial, commercial, and agricultural conditions in their respective districts. BOARD'S ORGANIZATION, STAFF, AND EXPENDITURES. The personnel of the Federal Reserve Board, which had remained intact for nearly four years, has undergone marked changes since July 22,1918, when Mr. Frederic A. Delano, now a lieutenant colonel, Corps of Engineers, United States Army, resigned his membership in order to engage in military service overseas. The term of Mr. Paul M. Warburg, vice governor of the Board, expired on August 9, and the resignation of Hon. Wm. G. MeAdoo, Secretary of the Treasury and ex officio chairman of the Board, became effective on December 16. Mr. Albert Strauss, of New York, was appointed by the President for the 10-year term to succeed Mr. Warburg, and taking the oath of office on October 20, was designated by the Presi dent as vice governor of the Board. Hon. Carter Glass, who became Secretary of the Treasury on December 16, is now by virtue of his office, chairman jof the Board. No successor to Mr. Delano has yet Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

ANNUAL EEPORT OF THE FEDERAL RESERVE BOARD. 85 been named. Dr. H. Parker Willis, who had been the secretary of the Board since its organization, resigned on August 1, and the Board elected as his successor, Mr. Joseph A. Broderick, of New York, who had been from the outset the chief of its Division of Audit and Ex amination, and in addition to his duties as secretary, Mr. Broderick remains as the head of that division. On May 16, Mr. Louis C. Adelson was elected assistant secretary of the Board, and on Sep tember 1, Mr. Webb T. Chapman was elected as an additional assist ant secretary. The marked growth of the activities of the Federal Reserve System has been accompanied by a heavy increase in the volume of the Board's work, necessitating considerable additions to the clerical force. The establishment of the Division of Foreign Exchange, with headquarters in New York, as well as the creation of the Division of Analysis and Research, have increased the number of persons employed by the Board from 76 on December 31, 1917, to 227 on December 31, 1918, of whom 91 are in the Division of Foreign Exchange, engaged in work which will end with the reestablishment of peace. The total cost of conducting the work of the Board during the year 1918, including salaries of members, expenses involved in printing the Bulletin, and the cost of operating the Division of Foreign Exchange, was $428,318.59. During the year 1918 two assessments were levied against the Federal Reserve Banks, aggregating $382,081, or approxi mately one-half of 1 per cent of the average paid-in capital and sur plus of the Federal Reserve Banks for the year. The annual reports of the Federal Reserve agents and further de tails relating to the operations of the Federal Reserve Board and of the Federal Reserve Banks appear in the appendix. CONCLUSION. Having submitted a report of operations in considerable detail, the Board deems it appropriate in closing to refer to certain facts and conditions which have had a bearing upon its policies and operations. In meeting the emergencies occasioned by the war, Governments everywhere have been compelled to make unprecedented drafts upon their national incomes and resources. With the great nations engaged in a death grapple, preservation of national life has been the supreme object. Most difficult questions of financial expediency have been presented to finance ministers in deciding upon the most available and effective means of mobilizing national resources. The decision once made, it became the duty of all separate administrative agencies con cerned with fiscal or banking functions to cooperate in giving effect to policies adopted, and it was in this spirit of cooperation that the Federal Reserve Board felt it to be its duty to assist in making effec tive the policies determined upon by the Secretary of the Treasury, Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

86 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. however inconsistent some of the steps necessary to be taken might be with principles which usually govern in normal times. The de mands of war are imperative and must be met without delay, and in financing the titanic struggle happily ended by the armistice last November first consideration could not always be given to what was theoretically desirable or convenient from the standpoint of banking practice. The financial obligations of the Government are being met, the war has. been won, hostilities have been ended, and representatives of the United States and the allied powers are now in conference regarding terms of peace. The country is confronted, it is true, with the problems incident to the demobilization of troops, the readjust ment of prices, and the diversion of industry from war activities to the employments of peace. We are approaching an era of general readjustment and resumption of construction at home, and of recon struction abroad, but the termination of the war at a time far in ad vance of popular expectation has minimized instead of magnified our national problems. We should have been confronted with them in any event whenever the war terminated, and the Government has not been required to withdraw from their ordinary employment the 2,000,000 or more of men it was preparing to withdraw in September last, nor is the country faced with the necessity of equipping them, and of main taining overseas military and naval forces for a year or more of 4,000,000 to 5,000,000 men. The expenditures of $25,000,000,000 to $30,000,000,000 which had been anticipated for the year 1919 will be greatly reduced, and instead of sending new men to the front the Government is bringing back a large portion of the forces which it had been maintaining abroad. Within a few months the country's war financing will have been completed, and the Board can then deal with the problems incident to bringing our credit structure and our banking operations back to a commercial basis. Our banking situation is strong and inher ently sound, and is much stronger than would have been the case had the war continued for another year. On December 31 the Federal Reserve Banks held a reserve of 'about 50 per cent against their combined liability for deposits and note issues, and if the reserve against deposits be computed on the basis of the legal requirement of 35 per cent, the reserve against Fed eral Reserve notes would be 60 per cent. The ability of the country to absorb investments has proved to be far greater than had been an ticipated, and our credit structure, although expanded, is unshaken. We have no currency problems, and conditions are not comparable with those which existed at the close of the Civil War, and while the volume of circulation is larger than it has been at any period in our Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. 87 history, there has been no depreciation in the gold value of our cur rency, every form of which is on an absolute parity with gold. True, the purchasing power of money has declined, but this is due to the abnormal and urgent demands for goods and services and the accompanying expansion of credit and currency. The quality of our currency has been maintained; there is a single standard of prices which is based upon the dollar, and not a double standard, one based upon the gold dollar and the other upon the paper dollar, as was the case during and after the Civil War. The increased vol ume of Federal Keserve notes has been an incident or an effect of expansion of credits, rather than the cause of such expansion, and the conditions which resulted in additions to the country's gold stock of more than $1,000,000,000 during the years 1915 and 1916 have changed. With the development of our foreign trade, with increased ship ping facilities, and with the granting of credits to other nations to aid them in their work of reconstruction and to enable us to sell them goods, a new influence will be felt in due course, which will work toward the restoration of more normal levels. Banking credits, which are not extended beyond our power to sustain them, but which are at present concentrated in this country, will become more widely diffused throughout the world, and the elastic quality of our cur rency, the main constituent of which is now the Federal Reserve note, will soon be manifest, as indeed it has already been evidenced in some degree by the retirement of approximately $200,000,000 of notes since the close of the year. An obligation rests upon the American people to assist the Gov ernment in the completion of its financial program and to absorb the securities which have been and are yet to be issued. This absorption can be accomplished by reasonable economies .and by persistent saving for some time to come, and it will be the duty of the Federal Reserve Board and of the banks in the meanwhile to aid in the extension of credit facilities, necessary in the processes of pro duction and distribution. Drastic contraction would be followed by results no less disastrous than those which would attend undue expansion, and the processes of deflation must therefore be permitted to work themselves out in a gradual and orderly manner. Discount rates, which for the past 18 months have been based upon the rates borne by Government issues, must for the time being continue to be fixed with regard to Treasury requirements, but when the war obli gations of the Government have been digested, and -the invested assets of the Federal Reserve Banks have been restored to a commer cial basis, rates can be established with reference to the commercial requirements of the country. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

88 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. The Board is profoundly conscious of the responsibilities imposed upon it by the Federal Eeserve Act, and during the period of re adjustment and afterwards as progress is made in the reestablishment of peace conditions, its purpose will be to exercise its control of our credit structure in such manner as best to promote the national wel fare, the agricultural, industrial, and commercial interests of the country, and the development of our foreign trade. By direction of the Federal Eeserve 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. 89 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Exhibit A—DISCOUNT RATES. No. 1.—Discount rates (high and loiv) in force during the period from Nov. 16, 1914, to Dec. 31, 1918. MATURITIES. Secured by United States Government W 15 i t d h a i y n s , A£; ri- war obligations. Trade 1 W 0 i d th a i y n s . 1 d 1 a t y o s . 3 0 m i b c n n e a e o o i c m n r n l t l l a e u g k a b l s d t s e . ' r 1 d 6 a to y s 3 . 0 3 d 1 a t y o s . 6 0 6 d 1 a t y o s 9 . 0 c o p u d s v l a t a l i a e o v t n p y r u c e d e s r k 9 r . a 0 l m 1 W i b c n 5 a e o c i i m n d n l l t l u g h a k a b d y t i s e n ' s r , 1 d 6 a t y o s 9 . 0 6 a w n a c 0 o ( n i c s t d t c e e h e a e p e i ) y s n t . s 6 a T a d c 1 n r c a a t c e y o d e p s e s 9 t . 0 9 m w 0 p C o a i d o t p d h a m e i y i t r n y s . 1 eral notes. 4 a * i i 1 i t- 1 3 i 1 i 1 4 H i E be H o 3 •a i w be 1 i w > o A i w o w H o 3 Boston: Nov. 16, 1914, to Dec. 31,1915 6 3 6 4 ^ 4 6 4 6 5 31 31 31 31 31 3* Jan. 1,1916, to Dec. 31,1916 31 3 4 3* 4 4 4 4 5 5 31 3 31 3 4 3* Jan. 1,1917, to Dec. 31, 1917 4 31 5 4 5 4 5 4 5 5 31 31 4 31 4 31 4 31 4 4 Jan. 1,1918, to Dec. 31,1918 4 4 5 4f 5 4| 5 4f 5 5 4 31 4£ 4 41 4 41 4 New York: Nov. 16,1914, to Dec. 31,1915... 51 3 51 4 6 •4 6 4 6 5 31 31 31 31 Jan. 1,1916, to Dec. 31,1916 3 3 4 4 4 4 4 4 5 5 31 31 31 31 Jan. 1,1917, to Dec. 31,1917 31 3 41 4 41 4 41 4 5 5 31 3 4 31 4 31 4 31 Jan. 1,19^8, to Dec. 31,1918 4 31 4f 41 4f 41 41 41 5 5 4 31 4 41 4 41 4 Philadelphia: Nov. 16,1914, to Dec. 31,1915 5J 3 51 4 6 4 6 4 6 *k 3 3 3 3 3 3 Jan. 1,1916, to Dec. 31,1916 31 3 4 4 4 4 4 4 41 41 31 3 31 3 31 3 Jan. 1,1917, to Dec. 31,1917 4 3 41 4 41 4 41 4 5 41 31 3 4 31 4 31 4 31 31 3* Jan. 1,1918, to Dec. 31,1918 4 4 4f 41 4f 41 4f 41 5 5 4 31 4J 4 41 4 41 4 i Commodity rates were established during September and October, 1915, and merged with those for commercial paper of corresponding maturities in November and December 1917. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

No. 1.—Discount rates (high and low) in force during the period from Nov. 16, 1914, to Dec. 31, 1918—Continued. CD to MATURITIES—Continued. Secured by United States Government Within war obligations. 15 days, A?5 ri- Trade includ cultural accept Trade Com 1 W 0 i d th ay in s . 1 d 1 a t y o s 3 . 0 m b e a i m n ng k b s e ' r 1 d 6 a t y o s 3 . 0 31 d a to y s 6 . 0 61 d a t y o s 9 . 0 s l a t i o v n c d e k 1 W in 5 c i d l t a u h y d in s , 6 w 0 a i n t d c h a e i s y n s 6 a a c 1 n c t c e o e p s 9 t 0 m w p o i a t d p h e i i t r n y c n o e o l r t l a e a l s t . o p d v a a e p y r e s 9 r . 0 m b e a i m n ng k b s e ' r 1 d 6 a to y s 9 . 0 no (s t e e e ) . days. 90 days. collat eral notes. i H! • a a o a to H 1 1 a •a 1 H - i ' • a a H o i a 1 W .5? H o 3 a 1 ^ l a •a H I 1 i H i ^ i w H i i • w a H 1 i Cleveland: Nov. 16,1914, to Dec. 31,1915 6 31 ! 6 4 6 4 6 41 6 5 31 31 4 4 Jan. 1,1916, to Dec. 31,1916 31 3* 4 4 4i 4 4J 41 5 5 31 3 4 31 Jan. 1,1917, to Dec. 31,1917 4 3i 41 4 41 4 41 41 5 5 31 3 4 81 4 3 4 4 4 4 Jan. 1,1918, to Dec. 31,1918 41 4 4f 41 4f 41 4i 41 51 5 4 3* 41 4 4i 4 41 4 Richmond: Nov. 16,1914, to Dec. 31,1915 6 4 6 4 6 4 6 4 6 5 31 31 4 4 3 3 Jan. 1,1916, to Dec. 31, i916 4 4 4 4 4 4 4 4 5 41 31 31 4 31 I 3* 3 Jan. 1,1917, to Dec. 31,1917 4 31 41 4 41 4 41 4 41 4i 31 3J 4 31 4 31 4 31 31 31 Jan. 1,1918, to Dec. 31,1918 '. 4| 4 5 4* 5 41 5 41 5 41 4i 31 41 4 4| 4 4| 4 Atlanta: Nov. 16,1914, to Dec. 31,1915 6 4 6 4 61 4 61 4 61 41 3i 31 31 31 3 3 Jan. 1,1916, to Dec. 31,1916 4 4 4 4 4 4 4 4 5 5 3i 31 31 31 31 3 Jan. 1,1917, to Dec. 31,1917 4 3§ 41 4 41 4 41 4 5 5 31 31 4 31 4 3i 4 31 31 3 Jan. 1,1918, to Dec. 31,1918 i 4i 4 4| 4i 41 41 4f 41 5 5 4 H 41 4 41 4 41 4 Chicago: Nov. 16, 1914, to Dec. 31,1915 ] 6 •3i 6 4 6 4 6 41 i 6 5 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Jan. 1,1916, to Dec. 31,1916 31 31 4 4 44 4 44 44 5 5 34 34 34 Jan. 1,1917, to Dec. 31,1917 4 34 44 4 44 4 5 4| 54 5 34 3 4 34 34 34 4 34 Jan. 1,1918, to Dec. 31,1918 4 4 4f 44 4| 4^ 5 4| 54 54 4 34 41 4 44 34 44 4 St. Louis: Nov. 16,1914, to Dec. 31,1915 6 3 6 4 6 4 6 4 6 5 34 34 34 34 3 3 Jan. 1,1916, to Dec. 31,1916 3 3 4 4 4 4 4 4 5 44 3-4 3 34 34 34 3 Jan. 1,1917, to Dec. 31,1917 4 34 44 4 44 4 44 4 54 44 34 34 4 34 4 3 4 34 34 3* Jan. 1,1918, to Dec. 31,1918 4 4 4f 44 4! 44 4f 44 54 54 4 34 4| 4 44 4 44 4 Minneapolis: Nov. 16,1914, to Dec. 31, 1915 6 4 6 4 64 4 61 44 64 5 3 3 Jan. 1,1916, to Dec. 31,1916 4 4 4 4 4 4 44 44 5 .5 34 34 34 34 34 3 Jan. 1,1917, to Dec. 31,1917 4 4 44 4 44 4 5 44 54 5 34 3 4 34 34 34 4 34 44 *3^ Jan. 1,1918, to Dec. 31,1918 44 4 4| 44 4f 44 5 5 54 54 4 34 4i 4 44 34 4-4 4 ^ansas City: Nov. 16,1914, to Dec. 31,1915 6 31 6 4 m 64 4 64 4 64 5 34 34 34 34 3 3 Jan. 1,1916, to Dec. 31,1916 44 34 44 4 44 4 44 4 5 5 4 34 4 34 4 3 Jan. 1,1917, to Dec. 31,1917 4 4 44 44 44 44 44 44 5 5 34 3 4 34 4 4 4 4 4 4 Jan. 1,1918, to Dec. 31,1918 44 4 Si 44 H 44 fri 44 54 5 4'i 34 4i 4 4f 4 4| 4 Dallas: Nov. 16,1914, to Dec. 31,1915 6 4 6 4 64 4 64 4 64 44 34 34 4 4 3 3 Jan. 1,1916, to Dec. 31,1916 4 4 4 4 4 4 4 4 44 4| 34 34 4 34 3 3 Jan. 1,1917, to Dec. 31,1917 4 34 44 4 44 4 44 4 5 44 34 34 4 34 34 34 4 34 34 3 Jan. 1,1918, to Dec. 31,1918 *2 4 4f 44 41 44 0 44 5* 5 4 34 41 4 44 34 44 4 San Francisco: Nov. 16,1914, to Dec. 31, 1915 6 3 6 34 64' 4 64 4-4 64 6 3 3 34 34 0) (i) Jan. 1,1916, to Dec. 31,1916 3 3 34 34 4 4 44 44 6 54 3 3 34 34 0) C1) Jan. 1,1917, to Dec. 31, 1917 4 34 44 34 44 34 44 44 54 5-4 34 34 4 34 4 3 4 3 C1) (2) Jan. 1,1918, to Dec. 31,1918 41 4 5 44 5 44 5 44 54 54 4i 34 4^c 4 4| 4 41 4 1 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. 2 Oct. 20,1917, rate of 34 per cent for commodity paper maturing within 60 days and 4 per cent for paper maturing after 60 days but within 90 days. NOTE.—In cases during 1918 where the 60-day trade acceptance rate was higher than the 15-day discount rate, trade acceptances maturing within 15 days were taken at the lower rate. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Exhibit B—FEDERAL RESERVE NOTES. CO No. 2.—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 191S. 5 [In thousands of dollars; i. e., 000 omitted.] New Phila Cleve Rich Minne Kansas San Boston. York. delphia. land. mond. Atlanta. Chicago. St. Louis. apolis. City. Dallas. ?rancisco.| Total. Federal Reserve notes received from the o Comptroller of Currency less notes re w turned for destruction: H Jan. 25 85,914 587,407 112,476 123,850 65,695 78,261 232,319 64,964 57,708 70,092 55, 743 80,238 1,614,667 O *) Feb. 21 93,156 586,427 120,083 131,443 64,902 77,548 239,446 64,098 56,736 70,340 55,016 83,033 1,642,228 Mar. 28-29 104,173 643,859 127,911 151,100 73,457 75,381 268,879 72,769 60,077 81,780 54,180 93,031 1,806,597 H Apr.26 119,251 661,907 154,404 164,932 78,820 76,568 290,087 75,030 61,430 84,845 53,674 103,148 1,924,096 w May31 123,152 680,878 158,219 180,235 85,820 75,598 303,273 77,646 60,531 86,520 52,882 121,933 2,006,687 June 28 127,973 722,286 172,653 19L896 88,097 60,058 320,914 77,026 61,713 86,595 52,353 134,454 2,096,018 July 26 151,685 785,755 189,996 21075b9 91,319 76,695 349,467 84,020 63,697 92,463 51,432 145,032 2,292,070 Aug. 30 158,343 821, 741 204,403 236,172 103,789 93,995 374,528 97,251 67,997 100,843 53,546 166,840 2,479,448 Sept. 27 170,008 865,377 219,675 252,259 120,163 128,597 416,165 110,437 80,454 112,062 72,548 192,080 2,739,825 Oct. 25 184,084 905,244 242,616 264,607 137,979 152,060 449,927 125,194 92,998 127,641 79,964 202,286 2,964,600 g Nov. 29 182,858 941,177 257,353 281,724 153,133 160,455 471,422 125,604 94,585 127,803 79,455 213,074 3,088,643 Bee. 27 183,253 920 937 259,846 157,375 168,668 493,692 132,907 105 418 126,940 78,352 229,250 3,140,529 Federal Reserve notes issued to Federal Reserve Banks (net amount): Jan. 25 80,754 477,607 97,236 108,410 61,275 63,821 190,339 58,339 50,868 59,872 44,873 80,238 1,373,632 W Feb. 21 85,796 493,227 105,403 121,363 58,797 62,418 201,425 60,813 51,596 63,280 42,581 83,033 1,429,732 o Mar. 28-29 95,453 528,659 121,671 137,340 68,502 58,376 224,399 68,009 54,582 73,620 40,345 93,031 1,563,987 Apr.26 104,211 546,107 127,864 146,492 72,620 60,173 242,607 67,950 55,935 77,085 36,464 103,148 1,640,656 May 31 109, 412 568,078 144,479 159,395 79,560 59,073 258,593 68,256 55,876 78,310 33,582 121,933 1,736,547 June 28 116,673 612,286 159,613 169,896 80,392 58,033 276,454 71,126 56,458 79,575 33,863 134,454 1,848,823 July 26 128,885 664,355 175,456 189, 709 84,954 58,960 298,567 76,970 59,142 84,243 33,207 145,032 1,999,480 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Aug. 30 141,743 705,941 198,283 216,232 96,889 68,245 333,188 91,451 62,677 93,823 43,626 166,840 2,218,938 Sept. 27 151,04S 770,177 210.755 237,359 113,563 101,342 370,985 107,317 78,014 103,342 58,223 192,080 2,494,205 Oct. 25.. 165,884 813,244 230.756 253,347 126,819 119,565 403,807 111,859 87,488 119,221 62,814 202,286 2,697,090 Nov.29 162,338 829,977 231,833 260,344 145,073 120,250 424,302 117,869 88,635 119,383 59,965 213,074 2,773,043 Dec. 27 169,413 811,137 242,206 264,911 151,155 126,253 452,852 129,607 119,420 60,432 229,250 2,855,604 Gold coin and certificates deposited with or to credit of Federal Reserve Agents: Jan. 25 44,354 236,467 64,916 64,610 26,305 47,575 120,514 34,882 37,522 48,369 22,181 46,134 793,829 Feb. 21 48,696 254,887 71,083 80,903 25,888 48,112 142,980 40,016 41,050 55,664 24,515 43,229 877,023 Mar. 29 48,453 196,319 79,751 88,680 29,374 39,495 165,223 41,047 39,536 55,384 17,363 51,567 852,192 Apr. 26 48,211 208,827 82,744 92,292 29,880 33,832 138,432 33,408 35,089 45,158 14,261 62,084 824,218 May 31 63,122 247,264 86,059 117,295 32,870 37,593 164,418 40,624 34,530 36,908 19,147 76,089 955,919 June 28 62,348 265,795 93,053 116,916 32,287 33,202 182,279 39,004 26,012 33,679 14,045 89,250 987,870 July26 56,445 279,859 99,389 110,629 32,950 26,339 118,392 31,496 23,596 33,497 13,980 910,420 Aug. 30 59,953 297,613 112,195 135,052 39,091 21,769 168,013 51,719 22,751 52,643 13,862 1,061,597 Sept. 27 , 58,925 286,671 110,208 153,479 47,293 36,340 206,111 56,615 29,378 57,489 24,286 94,936 1,161,731 Oct. 25 67,971 285,627 119,189 149,324 60,968 45,844 193,672 48,992 48,232 47,322 24,215 93,642 1,184,998 Nov. 29 70,785 282,220 78,605 132,321 60,833 44,399 244,167 53,083 57,279 52,799 22,500 117,550 1,216,541 Dec. 27 60,160 294,894 100,918 138,669 64,990 44,012 267,717 63,771 56,112 54,549 22,391 120,126 1,288,309 Eligible paper held by Federal Reserve Agents: Jan. 25 36,703 245,780 37,322 62,338 45,657 16,303 70,776 28,032 14,170 12,856 22,762 41,664 634,363 Feb. 21 57,868 354,066 36,622 44,330 38,613 14,589 61,448 26,044 10,753 14,668 18,275 55,579 732,855 Mar. 29 72,487 378,803 47,532 66,139 44,663 19,227 64,769 34,818 15,937 45,140 23,848 50,108 863,471 Apr. 26 70,913 555,283 57,638 78,840 50,859 26,608 133,445 49,885 23,603 47,244 30,722 45,319 1,170,359 May31 66,875 541,695 58,853 57,750 50,286 21,581 111,847 33,355 23,884 62,372 31,002 52,823 1,112,323 June 28 72,811 375,078 72,474 ' 70,158 56,185 25,535 134,511 54,570 39,342 51,569 28,816 50,563 1,031,612 July26 115,471 500,428 87,415 114,264 61,784 32,744 243,859 54,296 51,812 78,384 39,536 73,253 1,453,246 Aug. 30 100,934 683,514 89,145 115,581 62,409 46,888 229,256 48,317 54,202 59,071 43,050 81,447 1,613,814 Sept. 27 122,682 832,937 105,528 114,792 71,158 66,433 261,933 58,598 61,582 73,940 57,308 107,480 1,934,371 Oct. 25 145,124 722,973 116,765 135,362 69,556 77,872 274,955 * 73,928 39,260 87,422 48,077 110,348 1,901,642 Nov. 29 168,931 877,900 166,907 175,019 84,821 80,073 221,391 70,179 38,859 79,459 52,998 98,051 2,114,588 Dec. 27 146,086 721,698 150,926 167,065 86,793 82,769 235 860 71,624 56,293 70,801 53,612 112,830 1,956,357 CO OX Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

No. 2.—Net amount of Federal Reserve notes received from the Comptroller of the Currency, issued to each Federal Reserve Bank, etc.—Continued. CO New Phila Cleve Rich Minne Kansas San Boston. York. delphia. land. mond. Atlanta. Chicago. St. Louis. apolis. City. Dallas. Francisco. I Total. Federal Reserve notes held by banks: Jan 25 4,882 80,145 5, 3,654 8,132 4,082 10,174 2,278 1,938 4,594 256 12,757 138,698 Feb. 21 2,095 66,670 3, 3,929 5,382 3,481 10,983 2,368 1,089 4,561 212 11,154 115,151 Mar. 29 2,664 51,061 7, 5,861 6,910 1,448 12,629 4,451 1,044 5,228 249 12,195 111,149 Apr. 26 2,744 45,467 6, 6,256 11,040 1,632 15,452 7,083 1,204 5,755 842 10,161 114,424 May 31 4,937 50,970 10, 8,967 11,949 1,984 23,430 3,540 2,266 5,456 384 10,976 135,579 June 28 4,140 49,438 12, 6,978 5,867 1,894 23,815 5,464 1,245 5,179 1,237 9,167 126,607 July 26 3,126 43,916 12, 12,093 6,135 1,723 26,790 4,244 1,054 5,482 457 11,087 128,645 Aug. 30 4,926 46,175 13, 10,641 4,573 2,900 18,382 6,533 738 5,826 322 12,174 126,230 Sept. 27 2,995 70,527 10, 9,277 8,064 3,401 12,169 7,147 1,593 5,992 1,032 11,699 144,879 Oct. 25 14,092 91,305 15, .8,776 8,009 2,983 18,770 4,695 957 8,176 872 14,580 189,178 Nov. 29 11,432 109,683 1,103 12,809 10,606 3,099 20,668 6,466 1,038 7,425 1,173 11,865 204,367 Dec. 27 6,208 74,585 1,725 9,425 13,037 3,489 19,077 8,885 1,607 6,910 854 17,558 170,360 Federal Reserve notes issued by each Fed eral Reserve Bank and in actual circula tion: Jan. 25 75,872 •397,462 91,430 104,756 53,143 59,739 180,165 56,061 48,930 55,278 44,617 67,481 1,234,934 Feb. 21 83,701 426,557 102,176 117,434 53,415 58,937 190,442 58,445 50,507 58,719 42,369 71,879 1,314,581 Mar. 29 92,789 477,598 114,262 131,479 61,592 56,928 211,770 63,558 53,538 68,392 40,096 80,836 1,452,838 Apr. 26 101,467 500,640 121,076 140,236 61,580 58,541 227,155 60,867 54,731 71,330 35,622 92,987 1,526,232 May 31 104,475 517,108 133,759 150,428 67,611 57,089 235,163 64,716 53,610 72,854 33,198 110,957 1,600,968 June 28 112,533 562,848 147,430 162,918 74,525 56,139 252,639 65,662 55,213 74,396 32,626 125,287 1,722,216 July 26 125,759 620,439 162,918 177,616 78,819 57,237 271,777 72,726 58,088 78,761 32,750 133,945 1,870,835 Aug. 30 136,817 359,766 185,243 205,591 92,316 65,345 314,806 84,918 61,939 87,997 43,304 154,666 2,092,708 Sept. 27 148,053 699,650 199,772 228,082 105,499 97,941 358,816 100,170 76,421 97,350 57,191 180,381 2,349,326 Oct 25 151,792 721,939 214,793 244,571 118,810 116,582 385,037 107,164 86,531 111,045 61,942 187,706 2,507,912 Nov ,29 150,906 720,294 223,730 247,535 134,467 117,151 403,634 111,403 87,597 111,958 58,792 201,209 2,568,676 Pec. 27.. 163,205 736,552 233,481 255,486 138,118 122,764 433,775 120,722 97,361 112,510 59,578 211,692 2,685,244 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

No. 3.—Federal Reserve notes outstanding (i. e., net amount issued to Federal Reserve Banks), in actual circulation and gold and paper collateral held by Federal Reserve agents against outstanding notes. [In thousands of dollars; i. e., 000's omitted.] Federal Gold cover for notes issued. Paper collateral for notes issued. Reserve Federal notes Reserve Federal issued to In redemp In gold notes Reserve a R F B m e e a n s d o n e e e u k t r r n v s a t , e l . 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 t T io r U S e n n a t a s i f t t u u e e r n s d e d r , . se R F B t f t e e u l o d s e n a e e m d r r r d , v e a . e l n t T go o l t d a . l r A eq m u o ir u e n d t . a A m h c e o t l u u d a . n l t p E a x p c er e s h s e o ld f . R h F B e e e a l d s d n e e k r b r v s y a . e l - ci n rc a o u c te t l u a s t a i i l o n n. 1918, Jan. 4 1,366,335 269,951 41,158 486,082 797,191 569,144 608,324 39,180 115,130 1,251,205 11 1,368,148 264,490 42,317 477,519 784,326 583,822 608,898 25,076 125,949 1,242,199 18 1,373,105 274,000 46,182 476,545 796,727 576,378 609,056 32,678 134,308 1,238,797 25 1,373,632 276,894 45,596 471,339 793,829 579,803 634,363 54,560 138,698 1,234,934 Feb. 1 1,367,858 269,862 44,872 466,933 781,667 586,191 628,792 42,601 131,757 1,236,101 8 1,373,660 296,717 43,830 497,712 838,259 535,401 574,704 39,303 112,441 1,261,219 15 1,392,484 290,923 44,512 516,940 852,375 540,109 575,434 35,325 111,439 1,281,045 21 1,429,732 292,877 45,699 538,447 877,023 552,709 732,855 180,146 115,151 1,314,581 Mar. 1 1,464,645 276,987 49,747 558,612 885,346 579,299 782,777 203,478 113,554 1,351,091 8 1,505,213 278,207 47,986 570,509 896,702 608,511 813,275 204,764 121,223 1,383,990 15 1,520,296 266,824 47,984 554,820 869,628 650,668 821,052 170,384 114,068 1,406,228 22 1,558,705 271,658 47,021 560,126 878,805 679,900 852,674 172,774 129,196 1,429,509 29 1,563,987 253,524 48,926 549.742 852,192 711,795 863,471 151,676 111,149 1,452,838 Apr. 5 1,607,627 252,391 50,038 570,648 873,077 734,550 876,860 142,310 127,707 1,479,920 12 1,625,698 245,251 48,504 563,737 857,492 768,206 1,006,691 238,485 126,321 1,499,377 19 1,639,056 243,530 50,043 561,249 854,822 784,234 1,077,622 293,388 124,769 1,514,287 26 1,640,656 245,954 50,521 527.743 824,218 816,438 1,170,359 353,921 114,424 1,526,232 May 3 1,671,168 249,955 49,061 563,280 862,296 808,872 1,118,009 309,137 114,508 1,556,660 10 1,707,522 253,452 48,554 583,021 885,027 822,495 1,178,056 355,561 137,904 1,569,618 17 1,710,240 236,950 50,004 628,582 915,536 794,704 1,081,095 286,391 140,795 1,569,445 SO -a Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

No. 3.—Federal Reserve notes outstanding (i. e. net amount issued to Federal Reserve Banks), in actual circulation and gold and paper collateral held t by Federal Reserve agents against outstanding notes—Continued. 00 [In thousands of dollats; i e., 000 omitted.] Federal Gold cover for notes issued. Paper collateral for notes issued. Reserve Federal notes Reserve Federal i a R s F B m s e e u a n d s o n e e e e u d k t r r n v s a t , t e o l . 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 I t T n io U r r S e n e n t a d a i s f e t t u u e e m n s r d e d p r , . se R F I B t n f t e e u o l s d e g n a e e m o d r r r l d v , a e d e . l n t T go o l t d a . l r A eq m u o ir u e n d t . a A m h c e o t l u u d a . n l t p E a x p c er e s h s e o ld f . R h F B e n e e a l o s d d n e t e k e r r b s v s a y . e l ci n r R c a o e u c t s t e l e u a s r t a v i i l o n e n . 1918 May 24 724,685 228,449 53,080 648,652 930,181 794,504 1,155,877 361,373 146,064 1,578,621 31 736,547 232,448 53,428 670,043 955,919 780,628 1,112,323 331,695 135,579 1,600,968 June 7 769,876 228,446 52,221 677,588 958,255 811,621 1,193,629 382,008 130,297 1,639,579 14 793,393 225,444 51,994 673,707 951,145 842,248 1,219,848 377,600 141,893 1,651,500 21 805,518 215,445 54,587 687,206 957,238 848,280 1,127,797 279,517 127,567 1,677,951 28 848,823 223,945 55,404 708,521 987,870 860,953 1,031,612 170,659 126,607 1,722,216 July 5 917,152 214,944 56,873 690,258 962,075 955,077 1,224,983 269,906 125,583 1,791,569 12 963,729 203,444 58,378 701,325 963,147 1,000,582 1,313,041 312,459 150,304 1,813,425 19 982,603 197,944 60,602 681,744 940,290 1,042,313 1,356,726 314,413 153,558 1,829,045 26 999,480 202,239 59,859 648,322 910,420 1,089,060 1,453,246 364,186 128,645 1,870,835 Aug. 2 028,180 201,239 59,851 641,703 902,793 1,125,387 1,425,437 300,050 121,715 1,906,465 9 088,473 212,240 60,296 668,156 940,692 1,147,781 1,480,179 332,398 133,197 1,955,276 16 118,948 217,238 60,959 683,301 961,498 1,157,450 1,463,844 306,394 133,529 1,985,419 23 163,837 220,239 63,419 735,109 1,018,767 1,145,070 1,573,109 428,039 131,000 2,032,837 30 218,938 219,239 61,708 780,650 1,061,597 1,157,341 l,613j,814 456,473 126,230 2,092,708 Sept. 6 319,772 219,240 61,690 806,830 1,087,760 1,232,012 1,719,854 487,842 139,093 2,180,679 13 388,845 217,240 65,788 840,104 1,123,132 1,265,713 1,797,546 531,833 143,434 2,245,429 20 446,194 217,240 70,608 858,102 1,145,950 1,300,244 1,864,987 564,743 151,163 2,295,031 27 494,205 214,239 73,363 874,129 1,161,731 1,332,474 1,699,364 366,890 144,879 2,349,326 Oct. 4 583,418 208,239 113,060 860,186 1,181,485 1,401,933 1,942,433 540,500 152,414 2,431,004 10 623,339 208,167 77,477 871,356 1,157,000 1,466,339 2,049,522 583,183 144,961 2,478,378 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

18 667,024 201,239 78,053 894,229 1,173,521 1,493,503 2,012,927 519,424 164,536 2,502,488 25 697,090 207,176 78,609 899,213 1,184,998 1,512,092 1,901,642 389,550 189,178 2,507,912 Nov. 1 710,680 200,176 81,776 867,907 1,149,859 1,560,821 2,060,652 499,831 195,176 2,515,504 8. 740,686 198,176 78,586 868,878 1,145,640 1,598,046 2,110,238 518,192 185,490 2,558,196 15 161,812 210,176 78,352 878,051 1,166,579 l,595,23j3 2,120,296 525,063 199,295 2,562,517 22 768,777 211,626 78,793 878,498 1,168,917 1,599,860 2,006,806 406,946 213,562 2,555,215 29 773,043 212,627 77,991 925,923 1,216,541 1,556,502 2,114,588 558,086 204,367 2,568,676 Dec. 6. 741,852 231,627 75,679 900,071 1,207,377 1,534,475 2,161,189 626,714 157,329 2,584,523 13 764,699 250,327 74,376 843,068 1,167,771 1,596,928 2,176,410 579,482 160,119 2,604,580 20. 815,450 246,327 79,074 868,827 1,194,228 1,621,222 1,913,404 292,182 151,749 2,663,701 W 27. 855,604 246,327 81,951 960,031 1,288,309 1,567,295 1,956,357 389,062 170,360 2,685,244 IBI1 : B FEDERAL RESERVE K O H m Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

No. 4.—Total Federal Reserve notes in circulation and per cent of gold cover therefor during the calendar year 1918. [In thousands of dollars, i. e., 0C0 omitted.] Balance Gold re Balance available serve available 1918 T r o es ta e l r v c e a s s . h a d R g r e e a p e q i o s n u e s s i i r t r t v s e n e , d s e 3 i s F a e e s a r d v g r e e e a r s i a n n e l o r s v t t R e e e s - | s F c e i i e n r r d c v e a u e r c l n a a t l u t o i a t R o e l n e s . - | n R F a o g e e t a s d e e i e s n r r v s i a n t e l T r o es ta e l r v c e a s s . h d ag e R re p a e q i o s n u s e s i i r t t r v s e n e , d s 3 e t 5 s F a e e s a r d v g r e e e a r s i a n n e l o r s R v t t e e e s - | s F c i e i e n r r d c v a e u e c r l n a a tu l t o i R a t o e l e n s - . J per cent. in circula circula per cent. in circula tion. tion. tion. Per cent. Jan. 4, 1,733,030 506,180 1,226,850 1,251,205 98.1 July 5. 2,015,163 515,874 1,499,289 1,791,569 11. 1,748,031 505,716 1,242,315 1,242,199 100.0 12. 2,015,984 543,782 1,472,202 1,813,425 18. 1,784,307 523,735 1,260,572 1,238,797 101.8 19. 2,031,095 548,338 1,482,757 1,829,045 25. 1,782,759 522,507 1,260,252 1,234,934 102.1 2S. 2,029,329 568,005 1,461,324 1,870,835 Feb. 1. 1,775,457 520,813 1,254,644 1,236,101 101.5 Aug. 2. 2,034,918 545,594 1,489,324 1,906,465 8. 1,813,094 525,999 1,287,095 1,261,219 102.1 9. 2,044,523 551,713 1,492,810 1,955,276 15. 1,818,736 491,272 1,327,464 1,281,045 103.6 16. 2,045,523 529,377 1,516,146 1,985,419 21. 1,832,524 511,919 1,320,605 1,314,581 100.5 23. 2,055,266 557,924 1,497,342 2,032,837 Mar. 1. 1,837,773 503,960 1,333,813 1,351,091 98.7 30. 2,066,962 550,514 1,516,448 2,092,708 8. 1,847,883 515,354 1,332,529 1,383,990 96.3 Sept. 6. 2,070,494 560,578 1,509*, 916 2,180,679 15. 1,852,193 512,582 1,339,611 1,406,228 95.3 13. 2,077,732 567,758 1,509,974 2,245,429 22. 1,862,372 527,021 1,335,351 1,429,509 93.4 20. 2,076,039 570,242 1,505,797 2,295,031 29. 1,874,063 537,378 1,336,685 1,452,838 92.0 27. 2,072,176 583,488 1,488,688 2,349,326 Apr. 5. 1,877,433 535,277 1,342,156 1,479,920 90.7 Oct. 4. 2,077,371 562,192 1,515,179 2,431,004 12. 1,894,995 536,839 1,358,156 1,499,377 90.'6 11. 2,083,358 573,356 1,510,002 2,478,378 19. 1,898,307 525,786 1,372,521 1,514,287 90.6 18. 2,087,685 553,281 1,534,404 2,502,488 26. 1,890,945 544,706 1,346,239 1,526,232 88.2 25. 2,098,169 603,366 1,491,803 2,507,912 May 3. 1,919,983 532,335 1,387,648 1,556,660 89.1 Nov. 1. 2,105,685 582,182 1,523,503 2,515,504 10. 1,942,500 577,963 1,364,537 1,569,618 86.9 8. 2,100,839 581,532 1,519,307 2,558,196 17. 1,952,712 533,559 1,419,153 1,569,445 90.4 15. 2,109,816 582,987 1,526,829 2,562,517 24. 1,956,056 545,166 1,410,890 1,578,621 89.4 22. 2,116,257 571,470 1,544,787 2,555,215 31. 1,975,709 555,313 1,420,396 1,600,968 88.7 29. 2,120,371 583,899 1,536,472 2,568,676 June 7. 1,977,724 551,727 1,425,997 1,639,579 87.0 Dec. 6. 2,121,367 596,523 1,524,844 2,584,523 14. 2,005,263 556,070 1,449,193 1,651,500 87.8 13. 2,134,263 585,454 1,548/809 2,604,580 21. 1,981,111 505,891 1,475,220 1,677,951 87.9 20. 2,133,624 542,413 1,591,211 2,663,701 2,006,199 535,437 1,470,762 1,722,216 85.4 27. 2,146,219 543,502 1,602,717 2,685,244 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

TOTAL FEDERAL RESERVE NOTES IN CIRCULATION AND PER CENT OF60LD COVER THEREFOR DURING THE CALENDAR YEAR 1918. (tore!;Mvnimtzm,3tequired&qu)sit3leserve. *~ GirreZiJotalGzsKfieserres. §1 Gzriv3s3?3l.Mte6in(jrcuXc6w GrcalcUioiv. \\m- \100\ \do\ iso- \so. \P0] \?Q '\60\ [so \<o- \*o\ \30\ \&\ \20\ JO- \io [o 613 2Q274 // IS 251 <? WMimAMIMISlWmfflmMZMimM S&TEMBmOCTQBER \MOVEMDBEECRE MBERS Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

No. 5.—Statement of Federal Reserve notes by denominations, printed, shipped to Federal Reserve agents and United States subtresuries, and on nand in reserve vault Dec, 31, 1918. c Bank. Fives. Tens. Twenties. Fifties. Hundreds. Thousands. Total. Boston: • Printed $58,880,000 5110,480,000 $74,240,000 §30,000,000 §29,200,000 $302,800,000 Shipped 58,640,000 110,480,000 73,440,000 12,400,000 17,600,000 272,560,000 d On hand 240,000 800,000 17,600,000 11,600,000 30,240,000 w New York: Printed 350,800,000 465,000,000 340,880,000 100,600,000 194,000,000 $36,000,000 1,487,280,000 O Shipped 268,800,000 455,360,000 328,720,000 82,400,000 156,400,000 8,000,000 1,299,680,000 W On hand 82,000,000 9,640,000 12,160,000 18,200,000 37,600,000 28,000,000 187,600,000 O Philadelphia: Printed 59,460,000 114,200,000 155,840,000 34,200,000 30,000,000 393,700,000 w Shipped 56,740,000 100,120,000 145,360,000 24,400,000 20,000,000 346,620,000 H On hand 2,720,000 14,080,000 10,480,000 9,800,000 10,000,000 47,080,000 W O Cleveland; Printed 44,880,000 78,040,000 152,880,000 63,800,000 20,000,000 359,600,000 Shipped 37,64^0,000 70,240,000 143,360,000 59,400,000 18,400,000 329,040,000 On hand 7,240,000 7,800,000 9,520,000 4,400,000 1,600,000 30,560,000 Richmond; Printed 41,240,000 62,680,000 78,480,000 27,200,000 22,800,000 232,400,000 < Shipped 34,460,000 53,200,000 68,320,000 22,200,000 16,400,000 194,580,000 W On hand 6,780,000 9,480,000 10,160,000 5,000,000 6,400,000 37,820,000 o Atlanta: Printed 50,840,000 71,360,000 92,480,000 15,200,000 17,600,000 247,480,000 Shipped 43,780,000 68,440,000 72,400,000 11,200,000 12,400,000 208,220,000 On hand , • . • * . - ^ • ,....- 7,060,000 2,920,000 20,080,000 4,000,000 5,200,000 39,260,000 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Chicago: Printed 101,580,000 183,440,000 240,560,000 52,600,000 41,200,000 619,380,000 Shipped 96,320,000 180,000,000 232,800,000 38,000,000 28,400,000 575,520,000 On hand 1 5,260,000 3,440,000 7,760,000 14,600,000 12,800,000 43,860,000 St. Louis: Printed 45,760,000 61,680,000 70,560,000 10,800,000 7,600,000 196,400,000 Shipped 1 43,020,000 61,280,000 64,880,000 8,800,000 6,000,000 183,980,000 On hand 1 2,740,000 400,000 5,680,000 2,000,000 1,600,000 12,420,000 Minneapolis: Printed 45,820,000 51,880,000 49,440,000 4,000,000 5,200,000 156,340,000 Shipped j 37,040,000 50,520,000 40,720,000 2,200,000 4,000,000 134,480,000 On hand 1 8,780,000 1,360,000 8,720,000 1,800,000 1,200,000 21,860,000 Kansas City: Printed 59,140,000 52,960,000 62,320,000 10,200,000 10,000,000 194,620,000 Shipped 49,780,000 49,520,000 58,160,000 7,400,000 7,600,000 172,460,000 On hand ! 9,360,000 3,440,000 4,160,000 2,800,000 2,400,000 22,160,000 Dallas: Printed I 30,240,000 45,720,000 49,840,000 6,000,000 7,600,000 139,400,000 Shipped 27,180,000 37,880,000 39,680,000 2,800,000 4,000,000 111,540,000 On hand | 3,060,000 7,840,000 10,160,000 3,200,000 3,600,000 27,860,000 San Francisco: Printed 55,540,000 62,040,000 129,200,000 28,200,000 38,800,000 313,780,000 Shipped 50,400,000 59,640,000 123,680,000 21,000,000 31,200,000 285,920,000 On hand 5,140,000 2,400,000 5,520,000 7,200,000 7,600,000 27,860,000 RECAPITULATION. Total printed 944,180,000 1,359,480,000 1,496,720,000 382,800,000 424,000,000 36,000,000 4,643,180,000 Total shipped 1 803,800,000 1,296,680,000 1,391,520,000 292,200,000 322,400,000 8,000,000 4,114,600,000 Total on hand | 140,380,000 62,800,000 105,200,000 90,600,000 101,600,000 28,000,000 528,580,000 o CO Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

No. 6.—Federal Reserve notes, by denominations, issued through the Federal Reserve agents to the banks, also amounts retired and outstanding Dec. 31, 1918. o Bank. Fives. Tens. Twenties. Fifties. Hundreds. Thousands. Total. Boston: Issued $49,006,600 $98,325,600 $59,208,200 $7,602,000 $12,602,300 $226,744,700 Retired 21,772,900 26,490,&30 5,910,140 1,288,900 2,295,600 57,758,370 Outstanding 27,233,700 71,834,770 53,298,060 6,313,100 10,306,700 168,986,330 New York: Issued 1 248,890,350 417,447,800 308,758,400 70,602,450 137,214,000 $8,000,000 1,190,913,000 o Retired 124,305,355 145,596,480 59,666,980 9,012,950 33,315,400 371,897,165 w H Outstanding 124,584,995 271,851,320 249,091,420 61,589,500 103,898,600 8,000,000 819,015,835 o Philadelphia: Issued t 50,392,700 92,554,800 134,430,200 18,490,000 13,150,000 309,017,700 H Retired 19,120,385 26,208,210 19,896,460 1,158,600 763,300 67,146,955 W Outstanding 31,272,315 66,346,590 114,533,740 17,331,400 12,386,700 241,870,745 Cleveland: tei Issued 35,220,000 67,200,000 139,360,000 50,200,000 12,900,000 304,880,000 Retired 8,029,555 12,729,020 12,738,060 3,256,250 1,607,200 38,360,085 > Outstanding 27,190,445 54,470,980 126,621,940 46,943,750 11,292,800 266 519 915 B Richmond: Issued * l . 37,139,300 59,442,700 73,839,400 21,837,200 15,892,000 208,150,600 15,108,230 19,738,470 16 475,080 2,919,450 2,911,600 557,152,830 W Outstanding L . 22,031,070 39,704,230 57,364,320 18,917,750 12,980,400 150,997,770 o Atlanta: Issued 47,603,050 69,947,300 79,265,480 8,110,450 6,407,900 211,334,180 Retired 25,158,015 30,512,820 24, 984,360 3,966,900 3,091,800 87,713,895 Outstanding 22,445,035 39,434,480 54,281,120 4,143,550 3,316,100 123,620,285 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Chicago: Issued. 82,400,050 159,840,000 209,520,600 31,000,250 21,200,10C 503,961,000 Retired . 12,949,290 19,151,750 17,975,100 2,562,850 384,000 53,022,990 Outstanding 69,450,760 140,688,250 191,545,500 28,437,400 20,816,100 450,938,010 St. Louis: Issued 40,277,950 59,972,940 64,772,160 7,450,050 6,400,000 178,873,100 Retired . 16,463,565 17,630,620 11,915,440 1,290,100 2,453,500 49,753,225 Outstanding . 23,814,385 42,342,320 52,856,720 6,159,950 3,946,500 129,119,875 X W Minneapolis: W Issued 32,842,000 46,975,000 38,295,000 2,040,000 3,100,000 123,252,000 H Retired . 12,312,660 7,454,100 4,335,780 182,750 242,300 24,527,590 W Outstanding . 20,529,340 39,520,900 33,959,220 1,857,250 2,857,700 89,724,410 Kansas City: Issued 46,324,000 45,610,000 57,114,000 ! 8,860,000 5,420,00( 163,328,000 Retired 17,801,670 10,519,640 9,462,460 5,173,400 53,500 43,010,670 Outstanding . 28,522,330 35,090,360 47,651,540 I 3,686,600 5,366,500 120,317,330 Dallas: CO Issued . 23,180,000 42,555,900 43,438,600 3,800,650 6,165,000 119,140,150 Retired . 12,575,030 22,203,530 16,461,160 2,765,850 4,639,500 58,645,070 Outstanding . 10,604,970 20,352,370 26,977,440 1,034,800 1,525,500 60,495,080 3 San Francisco: O Issued 43.120,000 55,160,000 112,320,000 14,400,000 26,800,000 251,800,000 g Retired 9,958,495 6,234,620 5,558,800 370,150 439,600 22,561,665 Outstanding 23,161,505 48,925,380 106,761,200 14,029,850 26,360,400 229,238,335 RECAPITULATION. Total issued 1 736,396,000 1,215,032,040 1,320,322,040 244,393,050 267,251,300 8,000,000 3,791,394,430 Total retired 295,555,150 344,470,090 205,379,820 33,948,150 52,197,300 931,550,510 Total outstanding | 440,840,850 870,561,950 1,114,942,220 210,444,900 215,054,000 8,000,000 2,859,843,920 o OX Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

No. 7.—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. SI, 1918, as reported by Federal Reserve agents. O RECEIVED FROM COMPTROLLER OF THE CURRENCY. Federal Reserve agent at- Fives. Tens. Twenties. Fifties. Hundreds. Thousands. Total. d Boston $52,640,000 $101,480,000 $63,440,000 $10,400,000 $14, 800,000 $242,760,000 New York 263,800,000 445,360,000 324,720,000 80,400,000 152; 400,000 $8,000,000 1,274,680,000 Philadelphia.. 52,740,000 94,120,000 139,360,000 21,400,000 16; 800,000 324,420,000 Cleveland 36,440,000 70,240,000 143,360,000 57,000,000 16, 800,000 323,840,000 o Richmond 34,460,000 53,200,000 68,320,000 22,200,000 16, 400,000 194,580,000 Atlanta 41,720,000 65,000,000 70,320,000 9,200,000 10, 000,000 196,240,000 3 Chicago 87,600,000 170,520,000 227,440,000 35,600,000 26, 000,000 547,160,000 o St. Louis 37,020,000 54,760,000 58,800,000 6,800,000 4, 000,000 161,380,000 Minneapolis... 31,840,000 48,560,000 38,880,000 2,000,000 3, 200,000 124,480,000 H Kansas City... 44,780,000 45,040,000 54,080,000 5,400,000 6, 400,000 155,700,000 w Dallas 23,640,000 33,960,000 35,520,000 2,800)000 4, 000,000 99,920,000 San Francisco. 41,320,000 54,080,000 112,320,000 14,400,000 800,000 248,920,000 o Total. 748,000,000 1,236,320,000 1,336,560,000 267,600,000 297,600,000 8,000,000 3,894,080,000 - $ RETURNED BY FEDERAL RESERVE BANES. Boston $21,772,900 $26,489,830 $5,912,140 $1,2 87,400 $2,296,100 $57,7 58,370 New York 124,305,355 145,596,480 59,666,980 9 012,950 33,315,400 371,8 97,165 Philadelphia. 19,120,385 26,208,210 19,897,460 1 157,600 763,300 67,1 46,955 w Cleveland 8,029,555 12,729,020 12,738,060 3; 256,250 1,607,200 38,3 60,085 o Richmond.... 15,108,230 19,738,470 16,475,080 2,9 19,450 2,911,600 57,1 52, 830 Atlanta 25,158,015 30,512,820 24,984,360 3,9 66,900 3,091,800 87,7 13,895 Chicago 12,949,290 19,151,750 17,975,100 2; 562,850 384,000 53;0 22,990 St. Louis 16,463,565 17,630,620 11,915,440 1,2 90,100 2,453,500 49,7 53,225 Minneapolis.. 12,312,660 7,454,100 4,335,780 182,750 242,300 24,5 27,590 sCity.. 17,801,670 10,519,640 9,462,460 173,400 53,500 43,0 10*670 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Dallas 12,575,030 22,203,530 16,461,160 2,765,850 4,639,500 58,645,070 San Francisco 9,958,495 6,234,620 5,558,800 370,150 439,600 22,561,665 Total 295,555,150 344,469,090 205,382,820 33,945,650 52,197,800 931,550,510 TOTAL AMOUNTS FOR WHICH FEDERAL RESERVE AGENTS ARE ACCOUNTABLE. Boston $74,412,900 $127,969,830 $69,352,140 $11,687,400 $17,096,100 $300,518,370 New York 388,105,355 590,956,480 384,386,980 89,412,950 185, 715,400 $8,000,000 1,646,577,165 X Philadelphia.. 71,860,385 120,328,210 159,257,460 22,557,600 17,563,300 391,566,955 W Cleveland 44,469,555 82,969,020 156,098,060 60,256,250 18,407,200 362,200,085 W Richmond 49,568,230 72,938,470 84, 795,080 25,119,450 19,311,600 251,732,830 1i—-i3 Atlanta 66,878,015 95,512,820 95,304,360 13,166,900 13,091,800 283,953,895 W Chicago 100,549,290 189,671,750 245,415,100 38,162,850 26,384,000 600,182,990 St. Louis 53,483,565 72,390,620 70,715,440 8,090,100 6,453,500 211,133,225 4 Minneapolis... 44,152,660 56,014,100 43,215,780 2,182,750 3,442,300 149,007,590 Kansas City... 62,581,670 55,559,640 63,542,460 10,573,400 6,453,500 198,710,670 Dallas 36,215,030 56,163,530 51,981,160 5,565,850 8,639,500 158,565,070 San Francisco. 51,278,495 60,314,620 117,878,800 14,770,150 27,239,600 271,481,665 Total. 1,043,555,150 1,580,789,090 1,541,942,820 301,545,650 349,797,800 8,000,000 4,825,630,510 W CO ISSUED TO FEDERAL RESERVE BANKS. Boston $49,006,600 $98,325,600 $59,208,200 $7,602,000 $12,602,300 $226,744,700 O H New York 248,890,350 417,447,800 308,758,400 70,602,450 137,214,000 $8, 000, 000 1,190,913,000 Philadelphia.. 50,392,700 92,554,800 134,430,200 18,490,000 13,150,000 309,017,700 IP Cleveland 35,220,000 67,200,000 139,360,000 50,200,000 12,900,000 304,880,000 Richmond 37,139,300 59,442,700 73,839,400 21,837,200 15,892,000 208,150,600 Atlanta 47,603,050 69,947,300 79,265,480 8,110,450 6,407,900 211,334,180 Chicago 82,400,050 159,840,000 209,520,600 31,000,250 21, 200,100 503,961,000 St. Louis 40,277,950 59,972,940 64,772,160 7, 450,050 6,400,000 178,873,100 Minneapolis.. 32,842,000 46,975,000 38,295,000 2,040,000 3,100,000 123,252,000 O -3 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

No. 7.—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, 1918, as reported by Federal Reserve agents—Continued. o k 00 ISSUED TO FEDERAL RESERVE BANKS—Continued. Federal Reserve agent at— Fives. Tens. Twenties. Fifties. Hundreds. Thousands. Total. a Kansas City $46,324,000 $45,610,000 $57,114,000 $8,880,000 $5,420,000 $163,328,000 Dallas 23,180,000 42,555,900 43,438,600 3,800,650 6,165,000 119,140,150 San Francisco 43,120,000 55,160,000 112,320,000 14,400,000 26,800,000 251,800,000 O T otal 736,396,000 1,215,032,040 1,320,322,040 244,393,050 267,251,300 $8,000,000 3,791,394,430 W H O RETURNED TO COMPTROLLER FOR DESTRUCTION. W Boston $21,766,300 $26,484,230 $5,903,940 $785,400 $993,800 $55,933,670 124,215,005 145,508,680 58,828,580 8,810,500 8,501,400 345,864,165 18,707,685 25,573,410 19,147,260 1,067,600 413,300 64,909,255 B 7,929,555 12,129,020 12,658,060 1,856,250 407,200 34,980,085 12,428,930 12,495,770 10,235,680 1,682,250 519,600 37,362,230 11,204,965 10,504,520 5,818,880 184,450 191,900 27,904,715 > 12,309,240 19,151,750 15,574,500 2,562,600 383,900 49,981,990 St. Louis 10,615,615 12,417,680 5,943,280 240,050 53,500 29,270,125 g 9,430,660 6,679,100 3,080,780 52,750 62,300 19,305 590 Kansas City 15,137,670 8,069,640 4,428,460 173,400 53,500 27,862,670 Dallas 8,320,030 8,747,630 4,522,560 160,200 44,500 21,794,920 % 8,158,495 5,154,620 5,558,800 370,150 439,600 19,681,665 W o Total 260,224,150 292,916,050 151,007,780 17,945,600 12,064,500 734,851,080 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

IN HANDS OF FEDERAL RESERVE AGENTS DEC. 31,1918. Boston S3,640,000 $3,160,000 $4,240,000 $3,300,000 $3,500,000 $17,840,000 New York 15,000,000 28,000,000 16,800,000 10,000,000 40,000,000 109,800,000 Philadelphia... 2,760,000 2,200,000 5,680,000 3,000,000 4,000,000 17,640,000 Cleveland 1,320,000 3,640,000 4,080,000 8,200,000 5,100,000 22,340,000 Richmond 1,000,000 720,000 1,600,000 2,900,000 6,220,000 Atlanta 8,070,000 15,061,000 10,220,000 4,872,000 6,492,000 44,715,000 Chicago 5,840,000 10,680,000 20,320,000 4,600,000 4,800,000 46,240,000 X St. Louis 2,590,000 400,000 2,990,000 3 Minneapolis... 1,880,000 2,360,000 1,840,000 90,000 280,000 6,450,000 5 Kansas City... 1,120,000 1,880,000 2,000,000 1,540,000 980,000 7,520,000 Dallas 4,715,000 4,860,000 4,020,000 1,605,000 2,430,000 17,630,000 W San Francisco. Total. 46,935,000 72,841,000 69,920,000 39,207,000 70,482,000 299,385,000 feJ o RECAPITULATION. > Received from Comptroller $748,000,000 $1,236,320,000 $1,336,560,000 $267,600,000 $297,600,000 $8,000,000 $3,894,080,000 w Returned by bank 295,555,150 344,469,090 205,382,820 33,945,650 52,197,800 931,550,510 Total 1,043,555,150 1,580,789,090 1,541,942,820 301,545,650 349, 797,800 8,000,000 4,825,630,510 ui Issued to banks 736,396,000 1,215, 032,040 1,320,322,040 244,393,050 267,251,300 8,000,000 3,791,394,430 < 260,224,150 292,916,050 151, 700, 780 17,945,600 12,064,500 734,851,080 o On hand 46,935,000 72,841,000 69,920, 000 39,207,000 70,482,000 299,385,000 H CO Total 1, 043,555,150 1,580, 789,090 1,541,942,820 301,545,650 349,797,800 8,000,000 4,825,630,510 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

No. 8.—Mutilated Federal Reserve notes, by denominations, received and destroyed since organization of banks and on hand in vault Dec. 31, 1918. RECEIVED FOR DESTRUCTION. Bank. Fives. Twenties. Fifties. Hundreds. Total. > Boston $21,215,800 $25, 623,730 $5,546, $774,800 $982,400 $54,143,670 New York 101,235,005 112, 588,680 41,868, 6,010,500 6,501,400 268,204,165 Philadelphia 18,525,185 25, 132,410 18,800, 1,041,900 402,000 63,901,755 Cleveland 8,045,355 12 206,220 12,710, 1,871,600 411,100 35,244.535 Richmond 12,448,310 12, 524,390 10,258, 1,685,000 520,600 37,436,620 Atlanta 10,959,465 10 200,020 5,696. 183,300 191,900 27,231,065 O W Chicago 12,135,740 18; 621,750 15,266, 2,536,700 373.400 48,933,590 H St. Louis 10,408,115 12, 104,180 5,832, 234,050 53,500 28,632,125 O Minneapolis , 9,336,160 6,5 79,100 3,026, 52,650 61,300 19,055,990 Kansas City 14,996,195 7, 992,600 4,384 174,400 53,500 27,601,015 H Dallas. 8,277,030 8,6 64,630 4,484, 159,700 44,500 21,630,420 w San Francisco 8,203,655 5, 189,660 5,594, 373,350 442,700 19,803,805 Total received... 235,786,015 257,427,370 133,469,120 15,097,950 10,038,300 651,818,755 o Total destroyed. 231,905,150 251,984,830 130,726,760 14,711,600 9,805,800 639,134,140 Balance on hand 3,880,865 5,442,540 2,742,360 386,350 232,500 12,684,615 NOTE.—During the year, burned, badly mutilated, and fractional parts of Federal Reserve notes amounting to $18,255 have been identified, valued, and the bank of issue deter mined. W O Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

No. 9.—Statement of Federal Reserve Bank notes printed, issued to Federal Reserve Banks since organization, and on hand Dec. 31, 1918, PRINTED, ISSUED, AND ON HAND. I>aiL;. Ones. Twos. FiveG. Tens. Twenties. Fifties. Total. Boston: Printed $6,392,000 $1,024,000 $1,200,000 $8,616,000 tel- Issued 5,340,000 1,024,000 1,109,000 7,473,000 X W On hand 1,052,000 0 91,000 1,143,000 tw— i New York: H »—i Printed 21,600,000 6,208,000 10,720,000 $1,440,000 39,968,000 Issued 17,068,000 5,512,000 10,701,000 1,440,000 34,721,000 On hand 4,532,000 696,000 19,000 0 5,247,000 d Philadelphia: Printed 6,520,000 1,224,000 2,880,000 440,000 $240,000 11,304,000 Issued 6,360,000 1,144,000 1,901,000 0 0 9,405,000 m On hand 160,000 80,000 979,000 440,000 240,000 1,899,000 % Cleveland: Printed 5,428,000 1,576,000 5,360,000 2,000,000 2,000,000 16,364,000 Issued 4,828,000 1,496,000 4,325,000 0 0 10,649,000 O On hand 600,000 80,000 1,035,000 2,000,000 2,000,000 5,715,000 m Richmond: Printed 4,936,000 696,000 1,040,000 400,000 400,000 7,472,000 Issued 3,712,000 584,000 0 0 0 4,296,000 On hand 1,224,000 112,000 1,040,000 400,000 400,000 3,176,000 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

No. 9.—Statement of Federal Reserve Bank notes printed, issued to Federal Reserve Banks since organization, and on hand Dec. 31,1918—Continued. to PRINTED, ISSUED, AND ON HAND—Continued. Bank. Ones. Twos. Tivcs. Tens. Twenties. Fifities. Total. > Atlanta: Printed $4,144,000 $936,000 $2,260,000 $480,000 $480,000 $400,000 $8,700,000 > Issued 1 3,432,000 800,000 1,889,960 0 0 0 6,121,960 w On hand 712,000 136,000 370,040 480,000 480,000 400,000 2,578,040 O Chicago: w Printed 9,324,000 2,176,000 5,340,000 2,960,000 1,600,000 21,400,000 H Issued 8,796,000 2,176,000 5,300,000 2,631,760 865,600 19,769,360 O *i On hand 528,000 0 40,000 328,240 734,400 1,630,640 H H St. Louis: Printed 3,332,000 1,072,000 1,240,000 1,000,000 6,644,000 *J Issued 3,232,000 1,000,000 1,240,000 1,000,000 6,472,000 d On hand 100,000 72,000 0 0 172,000 P Minneapolis: U Printed 3,716,000 1,032,000 2,220,000 2,680,000 9,648,000 Issued 2,820,000 992,000 820,000 0 4,632,000 rn On hand 896,000 40,000 1,400,000 2,680,000 5,016,000 < Kansas City: Printed 3,624,000 912,000 5,340,000 5,040,000 3,600,000 18,516,000 W Issued 2,448,000 912,000 5,043,120 4,800,000 3,486,000 16,689,120 o On hand 1,176,000 0 296,880 240,000 114,000 1,826,880 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Dallas: Printed 2., 828,000 1,160,000 2,140,000 2,400,000 2,000,000 10,528,000 1,868,000 1,136,000 1,512,400 1,960,000 1,760,000 8,236,400 M o P00 On AhJ.aOJnJ.VdX 960,000 24,000 627,600 440,000 240,000 2,291,600 00 o San Francisco: 4,536,000 808,000 3,060,000 1,960,000 1,360,000 11,724,000 1 Printed . cp Issued 3,464,000 744,000 2,925,000 5,200 0 7,138,200 On hand 1,072,000 64,000 135,000 1,954,800 1,360,000 4,585,800 00 Recapitulation: Total printed 76,380,000 18,824,000 42,800,000 20,800,000 11,680,000 400,000 170,884,000 Total issued 63,368,000 17,520,000 36,766,480 11,836,960 6,111,600 0 • 135.603.040 V , , .,„ Total on hand 13,012,000 1,304,000 6,033,520 8,963,040 5,568,400 400,000 i 35.280.960 ISSUED, REDEEMED, AND OUTSTANDING, BY DENOMINATIONS. Issued. Redeemed. Outstanding. Ones £63,368,000 $981,700 562,386,300 Twos 17,520,000 147,850 17,372,150 Fives 36,766,480 2,486,680 34,279,800 Tens 11,836,960 2,544,840 9,292,120 Twenties _ 6,111,600 1,150,440 4,961,160 Total 135,603,040 7,311,510 128,291,530 Received for destruction and not assorted by denominations, $148,000. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

114 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. No. 10.—Statement showing Federal Reserve bank notes, by denominations, issued to Federal Reserve Banks under the provisions of the llPittman Act" up to and including Bee. 31, 1918. Bank. Ones. Twos. Fives. Tens. Total. Boston $5,292,000 $1,024,000 $1,100,000 $7,416,000 New York 16,544,000 5,472,000 10,620,000 $1,440,000 34,076,000 Philadelphia 6,336,000 1,144,000 1,900,000 9,380,000 Cleveland 4,812,000 1,488,000 4,319,000 10,619,000 Richmond 3,700,000 584,000 4,284,000 Atlanta 3,420,000 800,000 1,620,000 5, 840,000 Chicago 8,784,000 2,168,000 3,700,000 960,000 15,612,000 St. Louis 3,232,000 1,000,000 1,240,000 1,000,000 6, 472,000 Minneapolis 2,820,000 992,000 820,000 4,632,000 Kansas City 2,448,000 912,000 900,000 4,260,000 Dallas 1,868,000 1,136,000 500,000 3,504,000 San Francisco 3, 464,000 744,000 500,000 4, 708,000 Total issued 62, 720,000 17, 464,000 27,219,000 3, 400,000 110,803,000 No. 11.—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 1918 Was as follows: Boston $123, 099. 92 New York 275, 038. 66 Philadelphia 203, 666. 82 Cleveland 127,389.85 Richmond 105, 342. 85 Atlanta 124, 870. 87 Chicago 252,011.74 St. Louis 95, 393. 55 Minneapolis , 73,166. 63 Kansas City , , 70, 529.45 Dallas 55,523.47 San Francisco 163, 805.40 Total. 1. 669, 839. 21 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

No. 12,—Amounts of Federal Reserve notes received from, and returned to other Federal Reserve Banks for redemption or credit during the calendar year 1918 and totals for 191*7. New York. Philadelphia. Cleveland. Richmond. Received, Returned Received. Returned Received. Returned, Received. Returned. Received, j Returned, Boston [$28,023,300 $16,415,400 $1,734,700 $2,101,400 $2,173,900 $358,850 $1,592,100 $745,500 New York 15, 729, 182,800 26,000,590 41,454, 750 13,564,050 9, 712,450 17,119,950 10,454,100 Philadelphia... 2,173, 374,800 43, 178,000 31,085,350 7,153,500 4,640, 700 4,606,000 5,096,250 Cleveland 340, 145.540 517, 450 13, 639, 700 4,465,900 7,037,500 1,555,600 3,894,100 Bichmond 734, 620,600 742,900 17,519,100 3,281,000 4,728,250 3,980,100 1,560,350 Atlanta 494, 622,250 165, 750 9,300,050 976,740 1,402,100 2,068,615 304,450 2,690,015 1,698,500 Chicago 1,017, 219,810 226,000 14,085,950 1,575,500 3,061,500 6,598,000 3,297,800 1,529,500 2, 770,600 St. Louis 403, 380,400 274,050 3,013,150 651,995 655,500 2,562,420 372,350 933,705 479,000 Minneapolis 114, 338,700 001,300 2,312,750 150,000 418,000 345,000 302,450 197,080 412,250 Kansas City... 61, 450,000 691,050 3,406,000 106,050 655,250 237,150 369,800 233,450 759,250 Dallas 419, 176,500 989, 850 1,977,S00 393,300 307,150 1,350,300 125,150 322,700 139,250 San Francisco. 167, 420,300 240,820 5,873,950 195,530 533,260 333,100 205,100 333,535 154,250 Total, 1918 I 21,660, 305 37,931,700 118,050,470 118,629,200 39,531,305 62,354,660 40,366,135 21,249,450 31,113,635 26,603,050 Total, 1917 ! 4,278,8 12,012,900 29,997,052 24,799,975 8,066,790 14,960,902 5,175, 740 2.534,070 6,450,175 2,083,430 Atlanta. Chicago, St. Louis. Minneapolis. Kansas City. Received. Returned. Received. Returned Received. Returned. Received. Returned. Received. Returned. Boston $613,100 .$538,330 $2,247,800 $1,209,500 $381,600 $435,795 $337,900 $119,500 $577,200 $69,915 New York... 9,131,200 6,068,945 14,071,550 10,923,000 2,967,850 3,787,425 2,290,750 973,800 4,308,250 816,450 Philadelphia. 1,384,000 1,011,650 3,237, 500 1,931,500 644,000 781,190 460,000 140,000 821,500 105,900 Cleveland 297,900 2,003,865 3,294,050 6,654,000 356,500 2,670,470 308,450 350,500 463,440 245,800 Richmond 1,696,500 2,619,300 2, 765,850 1,553,000 363,500 99S, 725 412,500 202,500 803,240 160,440 Atlanta 2,493,075 2,013,000 2,309,010 3,847,640 435,300 106,000 1,228,355 291,800 d Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

No. 12.—Amounts of Federal Reserve notes received from and returned to other Federal Reserve Banlcsfor redemption or credit during the calendar year 1918 and totals for 1917—Continued. OS Atlanta. Chicago. St. Louis. Minneapolis. Kansas City. > Received. Returned. Received. Returned. Received. Returned, Received. Returned, Received. Returned Chicago $1,998,500 $2,415,825 $5,005,000 $12,959,065 $7,269,000 $4,130,250 $11,060,995 $1,358,850 0 St. Louis 3,755,740 2,305,805 |$12,486,965 $5,146;000 1,041,205 290,500 8,107,970 1,185,200 Minneapolis 100,000 427,160 4,261,800 7,347,000 280,500 1,099,765 1,235,000 578,700 Kansas City 248,100 986,540 1,285,100 8,578,500 987,800 6,336,660 456,300 1,046,500 Dallas 1,734,750 1,790,635 1,722,150 1,816,000 1,500,050 3,797,400 291,100 125,500 3,166,470 1,077,400 O San Francisco 147,725 270,870 1,842,315 4,285,100 223,725 843,625 993,600 1,630,250 1,831,940 430,150 3 Total, 1918 21,107,515 20,438,925 49,708,155 51,456,600 15,019,535 37,557,760 14,296,105 9,115,300 33,604,360 6,320,605 Total, 1917. 6,210, 710 4,650,150 5,129,265 15,268,500 3,344,960 7,979,770 5,537,985 1,351,000 7,783,185 1,118,755 O Dallas. San Francisco. Total, 1918. Total, 1917. H w Received. Returned. Received. Returned. Received. Returned. Received. Returned. *i Boston $166,500 $432,100 $426,300 $168,665 $38,274,000 $22,594,955 $11,941,700 $4,219,425 o New York 1,957,650 2,127,300 5,823,200 1,109,150 112,964,740 114,610,170 25,374,715 30,324,987 Philadelphia... 319,500 397,950 579,000 140,190 64,559,000 47,705,480 14,515,907 8,010,485 Cleveland 111,950 1,078,300 214,000 254,725 20,926,210 39,974,500 2,528,325 4,999,655 Richmond 142,250 282,950 140,500 301,475 24,063,090 31,546,690 2,070,680 6,392,235 Atlanta 1,771,260 1,680,000 314,970 119,330 20,947,940 21,385,120 4,654,345 6,117,975 Chicago 1,804,000 1,501,400 4,339,100 1,055,960 53,422,845 48,857,010 15,079,650 5,006,115 St. Louis 3,585,875 1,436,800 787,775 166,940 38,591,215 15,431,645 8,022,765 3,418,680 W Minneapolis... 125,500 242,150 1,625,250 427,325 9,435,930 13,906,250 1,327,000 5,508,090 O Kansas City.... 777,950 2,228,350 440,550 1,069,490 5,525,100 25,886,340 1,110,855 7,895,375 Dallas 891,900 281,435 14,782,020 11,614,220 3,536,050 5,760,020 San Francisco.. 321,510 447,910 7,631,520 15,094,765 1,933,625 4,456,440 Total, 1918. 11,083,945 11,855,210 15,582,545 5,094,685 411,124,010 408,607,145 Total, 1917. 5,765,280 3,506,950 4,355,640 1,843,080 92,095,617 92,109,482 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Exhibit C—STATEMENTS OF CONDITION OF FEDERAL RESERVE BANKS, No, 13.—Combined resources and liabilities of all Federal Reserve Banks as at close of business on the last Friday of each month during the calendar year 1918. RESOURCES. [In thousands of dollars; i. e., 000 omitted.] Jan. 25. Feb. 21. Mar.28-29. Apr. 26. May 31. June 28. July; Aug. 30. Sept. 27. Oct. 25. Nov. 29. Dec. 27. Gold coin and certificates in vault 472,012 447,508 489,948 486,820 456,177 419,907 418,012 384,009 370,220 376,679 370,938 337,365 Gold settlement fund 388; 210 375,273 399,568 439,477 425,237 491,425 598, 777 520,926 437,319 415,676 395,292 374,758 Gold with foreign agencies 52,500 52,500 52,500 52,500 52,500 16,275 11,628 5,829 5,829 5,829 5,829 Total gold held by banks 912, 722 875,281 942,016 978, 797 933,914 927,607 1,028,417 910,764 813,368 798,184 772,059 717,952 Gold with Federal Reserve agents 793,829 877,023 852,192 824,218 955,919 987,870 910,420 1,061,597 1,161, 731 1,184,998 1,216,541 1,288,309 Gold redemption fund , 19,956 20,091 21,496 23,985 27,993 33,544 35,363 41,433 45,714 61,950 76,613 84,013 Total gold reserve ft, 726,507 1,772,395 1,815,704 1,827,000 1,917,826 1,949,021 1,974,200 [2,013,794 2,020,813 2,045,132 2,065,213 2,090,274 Legal-tender notes, silver, etc 56,252 60,129 58,359 63,945 57,883 57,178 55,129 53,168 51,363 53,037 55,158 55,945 Total reserves 1,782, 759 1,832,524 1,874,063 1,890,945 1,975, 709 2, 006,199 2, 029,329 2, 066,962 2,072,176 2,098,169 2,120,371 2,146,219 Bills discounted: Secured by Government war obligations 312,520 263,905 301,451 642,429 562,993 434,509 673,231 896,228 1,221,533 1,092,417 1,412,511 1,400,371 All other 315,112 245,629 281, 777 259,314 334,364 434,666 628,920 531,967 491,897 453,747 402,684 302,567 Bills bought in open market 273,912 296,170 304,065 302,844 256,373 216,848 205,274 232,603 288,391 398,623 375,341 303,673 United States Government long-term securities 50,525 52,950 58,190 41,446 54,842 40,227 40,090 30,350 28,545 28,251 29,132 28,869 United States Government short-term securities 72,669 169,707 252,579 37,407 92,082 218,839 16,922 25,772 50,098 322,060 92,664 282,677 All other earning assets , 4,902 3,436 3,523 2,722 736 23 106 67 102 24 27 13 Total earning assets , 1,029,670 1,031,797 1,201,585 1,286,162 1,301,390 1,345,112 1,564,540 1,716,987 2,080,566 2,295,122 2,312,359 2,318,170 Uncollected items and other deductions from gross deposits 356,208 310,865 366,075 388,845 408,137 520,087 558,392 568,655 649,448 856,923 736,328 759,608 5 per cent redemption fund against Federal Reserve bank notes 537 537 537 528 735 701 1,164 2,447 3,692 4,621 5,988 All other resources 201 731 3,724 359 438 12,441 11,787 12,858 16,879 21,309 22,005 Total resources 3,176,454 3,445,984 3,566,839 3,686,300 , 872,133 4,165,403 4,365,555 |4,817,495 5,270,785 |5,194,9 5,251,990 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

No. 13.—Combined resources and liabilities of all Federal Reserve Banks as at close of business on the last Friday of each month during the calendar year 1918—Continued. OO LIABILITIES. [In thousands of dollars; i. e., 000 omitted.] Jan. 25. Feb. 21. Mar.28-29. Apr. May 31. June 28. July 26. Aug. 30. Sept. 27. Oct. 25. Nov. 29. Dec. ,27. Capital paid in 72,439 73,305 74,223 74,963 75,546 75,858 76,441 78,168 78,802 79,190 80,072 80,681 Surplus 1,134 1,134 1,134 1,134 1,134 1,134 1,134 1,134 1,134 1,134 1,134 1,134 Government deposits 135,691 56,165 104,086 130,668 166,191 84,535 233,040 104,729 191,623 78,218 207,157 63,367 o Due to members—reserve account 1,480, 743 1,459, 720 1,499,400 1,497,416 1,440,413 1,557,587 1,435,196 1,478,639 1,535,490 ,683,499 1,488,893 1,587,318 W H Collection items 194,955 199,278 216,897 235,174 278,698 286,302 401,186 437,885 485,059 702,107 602,667 554,823 Other deposits, including foreign Government credits 37,697 58,329 81,059 81, 890 109,443 121,482 111,840 120,300 104,385 117,001 105,894 106,992 O Total gross deposits 1,849,086 1,773,492 1,901, 442 1, 945,148 1,994, 745 2,049,906 2,181,262 |2,141,553 2,318,557 2,580,825 |2,404,611 2,312,500 H3 W Federal Reserve notes in actual circulation 1,234,934 1,314,581 1,452,838 1,526,232 1,600,968 1,722,216 1,870,835 2,092,708 2,349,326 2,507,912 |2,568,676 2,685,244 Federal Reserve bank notes in circulation—net lia bility 8,000 7,999 7,978 7,895 8,324 10,390 11,084 20,687 35,819 58,859 86,003 117,122 I All other liabilities 3,782 5,943 8,369 11,467 5,583 12,629 24,647 31,305 35,857 42,865 54,492 55,309 Total liabilities - 3,169,375 3,176,454 3,445,984 3,566,839 3,686,300 3,872,133 4,165,403 4,365,555 4,817,495 |5,270, 785 5,194,988 5,251,990 k MATURITIES OF BILLS ON HAND. Within 15 days 390,212 338,543 359,987 673,064 661, 804 548,873 884, 111 1,047,516 1,323,052 1,198,861 1,305,634 1,254,392 Over 15 but within 30 days 169, 795 104,830 127,065 194,238 110,168 136,574 200, 758 141,558 192,414 221,020 225,900 340,022 Over 30 but within 60 days 203,437 174,460 267,267 217,535 187,415 256,050 240,900 219,928 302,709 279,786 470,666 271,754 W O Over 60 but within 90 days 124,822 178,480 123,498 106,431 159, 874 101,227 141,331 223,655 171,434 232,891 165,185 113,506 Oyer 90 days 13,308 9,391 9,476 13,319 34,469 43,299 40,325 28,141 12,212 12,229 23,151 26,937 Total 901,574 805, 704 887.293 1,204,587 11,153,730 1,086,023 1,660,798 2,001,821 1,944,787 2,190,536 2,006,611 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

EXHIBIT C—CONDITION OF FEDERAL, RESERVE BANKS. 119 MOVEMENT OF EARNING ASSETS il OF ALL FEDERAL RESERVE BANKS \\ DURING THE CALENPAR YEAR IBIS. h (hrve /.• T^Sr£barL%^ver. Curve Z.-JotaUdilte Zkseountcd,. \\<v- Curved .Sills 2)i$covuzte& and jdoughtr. ? Curve 4.:Jot^&xrmiufJ!s$ets, utcC. U.S. Oovcrnmj&tf:Securities. J Qxrve S: JZatio of JV&r*Cban> j€uver / to Jotal3UlsSHscountecLarulJ$ou#h/;. ?* \\6S\ fir Wl iKCTtert T3" |pZ7L i Kf> \YfOv 'I \\35[ i \\<30\ 4UI92SI6 IS£II4!SZS9SZBaS3IOI?»3!?#Eim£19X29(62S336I32JZMI! Z2SIS £Z296G&2'\ JAN. \FEB.\MCH. I APR\ MAr\JUN£\JULY \AUG. \SEPT.\ OCT. \NQK I DSC Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

No. 14.—Principal resources and liabilities of all Federal Reserve Banks at close of business on each Friday, Jan. 4 to Dec. 27, 1918. to [In thousands of dollars; i. e., 000 omitted.] O Total cash Bills discounted. United United [c G er o ti a l f d n i c d c a o te in s . set f t G u le n o m l d d . e nt G f o o l r d e i w gn it h G R F o e e ld d se e w r r v a i e l t h red f e G u m n o p l d d . t ion! T r o es ta e l r v g e o s l . d i r n t e e c s l n l e e u d r g d v e a e i r l n s s , g , S m e G c e o u n v r t e e w d rn b a y r - All other. b m ou B o a p g r il k e h l n e s t t i . n m G e S t n o e t t v a r e l t m o e rn n s g- m G e S t n o e t t v a r s e m t h e rn o s rt-) se U T S cu n t o a r i t i t t a t e e l i s d e s. silver, etc. [obligations. securities. securities. Jan. 4. 480,072 338,687 52,500 797,191 19,270 1,687,720 1,733,030 285,919 339,894 271,338 51,167 92,058 143,225 11. 478,839 361,522 52,500 784,326 19,643 1,696,830 1,748,031 277,014 293,651 258,710 49,506 137,227 186,733 18. 477,301 383,232 52,500 796,727 19,710 1,729,470 1,784,307 300,268 303,220 257,804 45,911 122,310 168,221 25. 472,012 388,210 52,500 793,829 19,956 1,726,507 1,782,759 312,520 315,142 273,912 50,525 72,669 123,194 Feb. 1. 469,759 393,624 52,500 781,667 19,472 1,717,022 1,775,457 305,664 301,114 289,805 53,734 78,898 132,632 8. 439,907 404,042 52,500 838,259 19,960 1,754,668 1,813,094 269,302 255,819 280,705 52,294 173,588 225,882 15. 446,378 386,966 52,500 852,375 20,323 1,758,542 1,818,736 249,603 252,313 287,263 52,343 105,981 158,324 21. 447,508 375,273 52,500 877,023 20,091 1,772,395 1,832,524 263,905 245,629 296,170 52,950 169,707 222,657 Mar. 1. 461, 615 357,299 52,500 885,346 20,569 1,777,329 1,837,773 249,195 253,330 299,213 77,705 157,482 235,187 8. 464,144 354,585 52,500 896,702 20,267 1,788,198 1,847,883 264,501 255,839 317,952 72,154 182,822 254,976 15. 477,521 372,508 52,500 869,628 21,086 1,793,243 1,852,193 257,621 259,863 323,248 68,383 193,980 262,363 22. 470,529 379,866 52,500 878,805 21,114 1,802,814 1,862,372 282,962 260,157 328,880 61,039 226,036 287,075 28-29. 489,948 399,568 52,500 852,192 21,496 1,815,704 1,874,063 301,451 281,777 304,065 58,190 252,579 310,769 Apr. 5. 483,780 381,163 52,500 873,077 23,404 1,813,924 1,877,433 304,075 269,808 326,503 60,403 260,400 320,803 12. 488,762 407,971 52,500 857,492 23,546 1,830,271 1,894,995 465,625 247,182 318,857 54,237 142,143 196,380 19. 488,829 413,819 52,500 854,822 23,179 1,833,149 1,898,307 564,724 243,321 308,277 46,675 46,295 92,970 26. 486,820 439,477 52,500 824,218 23,985 1,827,000 1,890,945 642,429 259,314 302,844 41,446 37,407 78,853 May 3. 482,832 437,771 52,500 862,296 24,541 1,859,940 1,919,983 606,630 266,812 297,029 41,183 36,378 77,561 10. 480,580 437,444 52,500 885,027 27,584 1,883,135 1,942,500 612,324 326,717 286,036 40,116 106,762 146,878 17. 479,529 418,337 52,500 915,536 28,502 1,894,404 1,952,712 526,163 316,102 279,886 41,041 73,043 114,084 24. 478,460 407,767 52,500 930,181 29,115 1,898,023 1,956,056 600,499 322,800 278,221 42,067 32,476 74,543 31. 456,177 425,237 52,500 955,919 27,993 1,917,826 1,975,709 562,993 334,364 256,373 54,842 92,082 146,924 June 7. 463,622 417,675 51,280 958,255 28,431 1,919,263 1,977,724 627,025 357,467 248,542 64,484 32,601 97,085 14. 432,557 489,610 44,084 951,145 29,507 1,946,903 2,005,263 653,863 362,168 242,923 40,683 33,179 73,862 21. 438,773 481,023 17,008 957,238 30,331 1,924,373 1,981,111 544,193 387,077 232,472 40,877 35,883 76,760 28. 419,907 491,425 16,275 987,870 33,544 1,949,021 2,006,199 434,509 434,666 216,848 40,227 218,839 259,066 July 5. 421,927 524,303 16,272 962,075 34,533 1,959,110 2,015,163 563,496 513,286 211,947 42,749 17,350 60,099 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

12.. 422,738 524,225 15,529 963,147 34,413 1,960,052 2,015,984 606,599 553,283 218,464 40,273 31,923 72,196 19.. 428,853 556,154 15,496 940,290 34,655 1,975,448 2,031,095 601,403 601,943 205,932 40,259 16,358 56,617 26.. 418,012 598,777 11,628 910,420 35,363 1,974,200 2,029,329 673,231 628,920 205,274 40,090 16,922 57,012 Aug. 2.. 408,470 623,119 9,696 902,793 36,818 1,980,896 2,034,918 685,921 584,998 209,185 36,237 17,573 53,810 9.. 395,410 606,354 9,696 940,692 38,149 1,990,301 2,044,523 761,576 570,897 208,557 34,931 17,404 52,335 X 16.. 385,017 600,083 5,829 961,498 40,116 1,992,543 2,045,523 752,115 533,253 212,204 31,497 32,546 64,043 3 23.. 385,072 553,060 5,829 1,018,767 40,323 2,003,051 2,055,266 853,508 540,247 236,566 30,624 23,479 54,103 3 30.. 384,009 520,926 5,829 1,061,597 41,433 2,013,794 2,066,962 896,228 531,967 232,603 30,350 25,772 56,122 M Sept. 6.. 383,228 496,531 5,830 1,087,760 43,634 2,016,983 2,070,494 1,007,366 534,608 233,766 29,768 28,030 57,798 a 13.. 386,214 465,298 5,829 1,123,132 44,086 2,024,559 2,077,732 1,071,304 541,943 239,750 29,563 33,777 63,340 20.. 367,660 459,997 5,829 1,145,950 44,122 2,023,558 2,076,039 1,146,357 513,789 250,032 29,022 41,878 70,900 a 27.. 370,220 437,319 5,829 1,161,731 45,714 2,020,813 2,072,176 1,221,533 491,897 288,391 28,545 50,098 78,643 o Oct. 4.. 373,255 419,665 5,829 1,181,485 45,200 2,025,434 2,077,371 1,251,787 454,419 310,817 28,289 56,514 84,803 10.. 372,922 448,720 5,829 1,157,000 46,765 2,031,236 2,083,358 1,304,383 450,086 338,620 28,214 66,193 94,407 18.. 382,160 416,413 5,829 1,173,521 57,390 2,035,313 2,087,685 1,262,757 425,799 370,136 28,205 67,738 95,943 o 25.. 376,679 415,676 5,829 1,184,998 61,950 2,045,132 2,098,169 1,092,417 453,747 398,623 28,251 322,060 350,311 Nov. 1.. 383,833 449,248 5,829 1,149,859 63,460 2,052,229 2,105,685 1,252,904 493,049 377,072 29,472 88,750 118,222 o 8.. 3S6,437 43^,452 5,829 1,145,640 73,233 2,046,591 2,100,839 l,316,9o7 480,271 374,522 29,479 91,956 121,435 15.. 375,527 433,885 5,829 1,166,579 74,957 2,056,777 2,109,816 1,358,416 439,392 377,877 29,478 93,449 122,927 22.. 371,498 435,892 5,829 1,168,917 78,129 2,060,265 2,116,257 1,281,245 428 190 36S,784 29,134 148,180 177,314 O 29.. 370,938 395,292 5,829 1,216,541 76,613 2,065,213 2,120,371 1,412,511 402,684 375,341 29,132 92,664 121,796 Dec. 6.. 353,208 422,491 5,829 1,207,377 78,496 2,067,401 2,121,367 1,467,322 396,462 371,406 29,196 105,606 134,802 13.. 336,516 487,568 5,829 1,167,771 80,821 2,078,505 2,134,263 1,483,849 365,614 366,594 29,189 111,477 140. 666 W 20.. 335,141 461,369 5,829 1,194,228 82,421 2,078,988 2,133,624 1,299,524 306,778 340,765 28,850 325,073 353,923 27.. 337,365 374,758 5,829 1,288,309 84,013 2,090,274 2,146,219 1,400,371 302,567 303,673 28,869 282,677 311,546 ui W to Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

No. 14. -Principal resources and liabilities of all Federal Reserve Banks at close of business on each Friday, Jan. 4 to Dec. 27, 1918—Continued. to [In thousands of dollars; i. e., 000 omitted.] Other A e a l a l s r s n o e i t t n h s g . e r e a a T s r s o n e t i t a n s l g . U d f a r d n e n o e d c d i m p t o u e o l c o m l g s t e t i i r s h c o t o t s e n s e . r s s d s l o i T a u o b r t i c a l e i l s t i r a e e n s. d ] p C a a id p it i a n l . Surplus. d G e m o p v o e e s n r i t t n s . 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 . - Co it ll e e m ct s i . on i d n g f e c o m o p l r v u o e e e d s i n r g i t i n n t n s g , de T g p r o o o t s s a i s l t s. ci n R F r a c o e e c u t s d t e l e u e s a r r a t v a i i l n e o l n. b i t n l a i R F i o n a c e e k n b i s d — r i e e l c n r i r u n o t v a l y e e t l a . e t s 3 credits. Jan. 4 5,167 1,045,543 347,251 3,126,898 70,825 1,134 131,006 1,449,230 192,649 20,594 1, 793,479 1,251,205 8,000 11 5,063 1,021,171 334,822 3,105,080 71,603 1,134 57,856 1,498, 482 203,073 20,315 1, 779, 726 1,242,199 8,000 o 18 4,224 1,033,737 417,526 3,236,486 71,938 1,134 239,829 1,421, 576 221, 728 30,779 1,913, 912 1,238, 797 8,000 25 4,902 1,029,670 356,2C8 3,169,375 72,439 1,134 135,691 1,480, 743 194,955 37,697 1,849,086 1,234,934 8,000 H Feb. 1 3,805 1,033,020 366,456 3,176,023 72,620 1,134 132,790 1,478,644 191,283 51,769 1,854, 486 1,236,101 8,000 O 8 4,423 1,036,131 284,964 3,135,277 72,829 1,134 59,488 1,501,301 167,154 59,874 1,787, 817 1,261,219 8,000 15 4,486 951,989 374,327 3,146,171 73,229 1,134 87,643 1,409, 714 228,289 52,315 1.777.961 1,281,045 7,999 Hi 21 3,436 1,031,797 310,865 3,176,454 73,305 1,134 56,165 1,459, 720 199,278 58,329 1, 773, 492 1,314,581 7,999 w Mar. 1 3,680 1,040,605 381,067 3,260,778 73,401 1,134 150,781 1,388,020 218,031 64,122 1,820, 954 1,351,091 7,999 H 8 4,064 1,097,332 343,396 3,289,909 73,624 1,134 56,208 1,465,504 216,986 77,137 1,815,835 1,383,990 8,000 *A 15 4,040 1,107,135 368, 756 3,330,073 73,886 1,134 72,023 1,448,047 232,157 81,048 1,833,275 1,406,228 8,000 S 21 4,240 1,163,314 376,622 3,403,395 74,011 1,134 91,505 1,480,025 229,115 81,751 1,832,396 1, 429,509 7,978 28-29 3,523 1,231,585 366,075 3,445,984 74,223 1,134 104,086 1,499,400 216,897 81,059 1,901,442 1,452,838 7,978 Apr. 5 3,222 1,224,411 356,954 3,459,659 74,494 1,134 104,818 1,473,294 226,139 82,067 1,886,318 1,479,920 7,860 12 3,771 1,231,815 384,824 3,512,495 74,748 1,134 100,523 1,494,537 239,270 84,321 1,918,651 1,499,377 8,000 CO 19 3,293 1,212,585 387,655 3,499,217 74,829 1,134 75,499 1,469,860 256,220 88,322 1,889,901 1,514,287 7,895 26 2,722 1,286,162 388,845 3,566,839 74,963 1,134 130,668 1,497,416 235,174 81,890 1,945,148 1,526,232 7,895 May 3. 2,537 1,250,569 376,605 3,548,023 75,049 1,134 73,888 1,474,518 257,593 91,563 1,897,562 1,556, 660 7,980 10 1,844 1,373,799 455,726 3, 772,495 75,118 1,134 138,529 1.548.137 309,773 110,611 2,107,050 1,569,618 7,878 o 17 1,492 1,237,727 382,509 3,573,555 75,315 1,134 48,753 1.461.138 282,475 114,596 1.906.962 1,569,445 7,878 24 1,151 1,277,214 351,407 3,585,303 75,465 1,134 122,350 1,436,284 242,488 107,903 1,909,025 1,578,621 7,764 31 736 1,301,390 408,137 3,686,300 75,546 1,134 166,191 1,440,413 278,698 109,443 1,994, 745 1,600,968 8,324 June 7. 694 1,330,813 402,529 3, 711,703 75,662 1,134 179,876 1,449,486 239,971 109,560 1,978,893 1,639,579 9,580 14. 594 1,333,410 510,303 3,849,711 75,711 1,134 155,532 1,555,434 264, 887 123,221 2,099,074 1,651,500 10,001 21 100 1,240,602 584,154 3,806,692 75,770 1,134 159,457 1,464,986 287,769 117,345 2,029,557 1,677,951 9,945 28. 1,345,112 520,087 3,872,133 75,858 1,134 84,535 1,557,587 286,302 121,482 2,049,906 1,722,216 10,390 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

July 5 26 348, 854 669,257 4,044,162 76,163 1,134 128,398 1,369,697 527, 580 117, 509 2,143,184 1, 791,569 10,635 12 72 450,614 640,410 4,117, 722 76,324 1,134 169,393 1,439,346 477,526 107, 809 2,194, 074 1,813,425 10,800 19 98 465, 993 658, 588 4,166,122 76,383 1,134 144,828 1,488,047 480,341 112, 052 2,225, 268 1,829,045 11,000 26 103 ,564,540 558,392 4,165,403 76,441 1,134 233,040 1,435,196 401,186 111, 840 2,181, 262 1,870,835 11,084 Aug. 2 101 534,015 531,558 4, 111, 538 76,518 1,134 161,236 1,423,532 390,911 114,718 2,090,397 1,906,465 11,479 X 9 102 593,467 584, 758 4,234,893 76,876 1,134 179,978 1,420, 705 433,347 127,050 2,161, 080 1,955,276 13, 716 W 16 82 561, 697 623,495 4,242,384 76,960 1,134 95,555 1,464, Oil 461,202 115,234 2,136,002 1,985,419 15,167 w 23 62 684,486 601,983 4,353,987 77,750 1,134 173,027 1,459,480 450,947 112,597 2,196,051 2,032,837 16,864 30 67 716,987 568,655 4,365,555 78,168 1,134 104, 729 1,478,639 437,885 120,300 2,141, 553 2,092,708 20,687 Q Sept 6 75 833,613 642,377 4,559,873 78,359 1,134 197,325 1,465,102 461,640 119,960 2,244,027 2,180,679 23,964 13 81 916,418 697,225 4, 705, 793 78,553 1,134 206, 733 1, 469, 603 527, 752 115,302 2,319,390 2,245,429 27,672 o 20 84 981,162 654,843 4,726, 766 78,689 1,134 169,141 1,524,528 490,265 100,173 2,284,107 2,295,031 33,208 o 27 102 080,566 649,448 4,817,495 78,802 1,134 191,623 1,535,490 485,059 104,385 2,316,557 2,349,326 35,819 Oct. 4 202 102,028 704,046 4,899,386 78,903 1,134 197,359 1,496,815 512,227 103,907 2,310,308 2,431,004 40,305 10 188 187,684 723,430 5,011,134 78,956 1,134 230,889 1,508,334 514,110 108,256 2,361,589 2,478,378 52,031 O 18 1 197 154,832 803,517 5,063,216 79,057 1,134 179,868 1,506,727 585,090 112,634 2,384,319 2,502,488 55,666 25. 24 295,122 856,923 5,270,785 79,190 1,134 78,218 1,683,499 702,107 117,001 2,580,825 2,507,912 58,859 o Nov. 1. 35 241,276 684,315 5,052,114 79,360 1,134 249,397 1,442,493 543,975 111,827 2,347,692 2,515,504 63,338 28 293,223 687,468 5,104,244 79,824 1,134 160,256 1,545,996 527, 796 114,941 2,348, 989 2,558,196 68,864 15. 28 298,640 717, 785 5,148,418 79,903 1,134 246,401 1,449,949 573,727 113,385 2,383,462 2,562,517 72,930 O 22. 27 255,560 819,010 5,219,527 80,025 1,134 113,174 1,604,033 620,608 113,967 2,451,782 2,555,215 80,504 w 29. 27 312,359 736,328 5,194,988 80,072 1,134 207,157 1,488,893 602,667 105,894 2,404,611 2,568,676 86,003 > Bee. 6. 27 370,019 650,039 5,168, 709 80,304 1,134 185,355 1,547,838 514,512 106,685 2,354,390 2,584,523 92, 799 13. 27 356,750 719,591 5,234,934 80,492 1,134 161,614 1,567,927 556, 764 106,012 2,392,317 2,604,580 102,202 20. 16 301,006 826,831 5,288,134 80,585 1,134 38,693 1,642,444 588,755 106,689 2,376,581 2,663, 701 111, 909 t w e J 27. 13 318,170 759,608 5,251,990 80,681 1,134 63,367 1,587,318 554,823 106,992 2,312,500 2,685,244 117,122 w <J w > W to Co Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

No. 15.-—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 omitted.] Federal Reserve notes Ratio of I vet deposits. in circulation. Total net total cash a d nd e po F s e i d t am To o t u a n l t Total cash e G xc o e ld ss i o n f n re et s e d r e v p es o s t i o t Amount. r R e e s q er u v i e r e o d f Amount. r R e e s q er u v i e r e o d f l s i e e a r r b v al i e l i R n t e i o e te s . of r e r s e e q r u v i e r s e . d re h s e e l r d v . e s (f r r r e e e q e s u e g i r r v o e e l d s d ). [ s a e e n r r d v a e l F R n e o d e - te 35 per cent. 40 per cent. 1 liabilities combined. 1918 Per cent. Jan. 4 1 1,443,228 506,180 1,251,205 500,482 2,697,433 1,006,662 1,733,030 726,368 64.2 11 1,444,904 505,716 1,242,199 496,880 2,687,103 1,002,596 1,748,031 745,435 65.1 18 1,496,386 523,735 1,238,797 495,519 2,735,183 1,019,254 1,784,307 765,053 65.2 25 1,492,878 522,507 1,234,934 493,974 2,727,812 1,016,481 1,782,759 766,278 65.4 Feb. 1 1,488,036 520,813 1,236,101 494,440 2,724,137 1,015,253 1,775,457 760,204 65.2 8 1,502,853 525,999 1,261,219 504, 488 2,764,072 1,030,487 1,813,094 732,607 65.6 15 1,403,634 491,272 1,281,045 512,418 2,684,679 1,003,690 1,818; 736 815,046 67.7 21 1,462,627 511,919 1,314,581 525,832 2,777,208 1,037,751 1,832,524 794,773 66.0 Mar. 1 1,439,887 503,960 1,351,091 540,436 2,790,978 1,044,396 1,837,773 793,377 65.8 8 1,472,439 515,354 1,383,990 553,596 2,856,429 1,068,950 1,847,883 778,933 64.7 15 1,464,519 512,582 1,406,228 562,491 2,870,747 1,075,073 1,852,193 777,120 64.5 22 1,505,774 527,021 1,429,509 571,804 2,935,283 1,098,825 1,862,372 763,547 63.4 28-29 1,535,367 537,378 1,452,838 581,135 2,988,205 1,118,513 1,874,063 755,550 62.7 Apr. 5 1,529,364 535,277 1,479,920 591,968 3,009,284 1,127,245 1,877,433 750,188 62.4 12 1,533,827 536,839 1,499,377 599,751 3,033,204 1,136,590 1,894,995 758,405 62.5 19 1,502,246 525,786 1,514,287 605,715 3, 016,533 1,131,501 1,898,307 766,806 62.9 26 1,556,303 544,706 1,526,232 610,493 3,082,535 1,155,199 1,890,945 735,746 61.3 May 3 1,520,957 532,335 1,556,660 622,664 3,077,617 1,154,999 1,919,983 764,984 : 62.4 10 1,651,324 577,963 1,569,618 627,847 3,220,942 1,205,810 1,942,500 736,690 60.3 17 1,524,453 533,559 1,569,445 627,778 3,093,898 1,161,337 1,952,712 791,375 63.1 24 1,557,618 545,166 1,578,621 631,448 3,136,239 1,176,614 1,956,056 779,442 62.4 31..... ................. 1,586,608 555,313 1,600,968 640,387 3,187,576 1,195,700 1,975,709 780,009 62.0 June 7 1,576,364 551,727 1,639,579 655,832 3,215,943 1,207,559 1,977,724 770,165 1 61.5 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

14. !,771 556,070 1,651,500 660,600 3,240,271 1,216,670 2,005,263 788,593 61.9 21. 445,403 505,891 1,677,951 671,180 3,123,354 1,177,071 1,981, 111 804,040 63.4 28. 529,819 535,437 1,722,216 688,886 3,252, 035 1,224,323 2,006,199 781,876 61.7 July 5. 473,927 515,874 1,791,569 716,628 3,265, 496 1,232,502 2,015,163 782,661 61.7 12. 553,664 543,782 1,813,425 725,370 3,367,089 1,269,152 2,015,984 746,832 59.9 X 19. 566,680 548,338 1,829,045 731,618 3,395,725 1,279,956 2,031,095 751,139 59.8 H 26. 622,870 568,005 1,870,835 748,334 3,493,705 1,316,339 2,029,329 712,990 58.1 H-1 Aug. 2 558,839 545,594 1,906,465 762,586 3,465,304 1,308,180 2,034,918 726,738 58.7 w 9. 576,322 551,713 1,955,276 782,110 3,531,598 1,333,823 2,044,523 710.700 67.9 H 16. 512,507 529,377 1,985,419 794.168 3,497,926 1,323,545 2,045,523 721,978 58.5 O 11 23. 594,068' 557,924 2,032,837 813,135 3,626,905 1,371,059 2,055,266 684,207 56.7 Q 30. 572,898 550,514 2,092,708 837,083 3,665,606 1,387,597 2,066,962 679,365 56.4 O Sept. 6 601,650 560,578 2,180,679 872,272 3, 782,329 1,432,850 2,070,494 637,644 54.7 a 13. 622,165 567,758 2,245,429 898,172 3,867,594 1,465,930 2, 077,732 611,802 53.7 20. 629,264 570,242 2,295,031 918,012 3,924,295 1,488,254 2,076,039 587,785 52.9 27. 667,109 583,488 2,349,326 939,730 4,016,435 1,523,218 2,072,176 548,958 51.6 O Oct. 4. 606,262 562,192 2,431,004 972,402 4,037,266 1,534,594 2,077,371 542,777 51.5 O 10. 638,159 573,356 2,478,378 991,351 4,116,537 1,564,707 2,083,358 518,651 50.6 18. 580,802 553,281 2,502,488 1,000,995 4,083,290 1,554,276 2,087,685 533,409 51.1 25 723,902 603,366 2,507,912 1,003,165 4,231,814 1,606,531 2,098,169 491,638 49.6 Nov. 1. 663,377 582,182 2,515,504 1,006,202 4,178,881 1,588,384 2,105,685 517,301 50.4 8, 661,521 581,532 2,558,196 1,023,279 4,219,717 1,604,811 2,100,839 496,028 49.8 15. 665,677 582,987 2,562,517 1,025,007 4,228,194 1,607,994 2,109,816 501,822 49.9 22 632,772 571,470 2,555,215 1,022,086 4,187,987 1,593,556 2,116,257 522.701 50.5 fS 29. 668,283 583,899 2,568,676 1,027,470 4,236,959 1,611,369 2,120,371 509,002 50.0 CO Dec. 6. 704,351 596,523 2,584,523 1,033,809 4,288,874 1,630,332 2,121,367 491,035 49.5 i 13. 072,726 585,454 2,604,580 1,041,832 4,277,308 1,627,286 2,134,263 506,977 49.9 20. 549,750 542,413 2,663,701 1,065,480 4,213,451 1,607,893 2,133,624 525,731 50.6 27. 552,892 543,502 2,685,244 1,074,098 4,238,136 1,617,600 2,146,219 528,619 50.6 w > W Ul to Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

126 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. DEPOSIT AND NOTE LIABILITIES, ALSO CASH RESERVES, OF ALL FEDERAL RESERVE BANKS, DURIN6 THE CALENPAR YEAR 1318. Curve/: Jfet&eftosits. Curve 2. Total CaslvJteserves. 1 Chrv&^^taUo of Gzsfufi&erves 60 JJggregcU^ Mt2>ert0steand^.Mte£MXXce8. M \eo\ Vsel 411182SIJIf21J3tS22SSZBBS3IO17&317lta2gSIZ826i3l6a3O6B202?4ltJS2SI*> &Z&6B2J27\ JAN. IFEBAMCH. \APR. WAY\JUNE\JULY \AUO. \SEFT. I OCT. 1 /Y<7K 1 PEC. \ Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

127 EXHIBIT C CONDITION OF FEDERAL RESERVE BANKS. TOTAL CASH RESERVES AND EXCESS RESERVES Or ALL FEDERAL RESERVE BANKS DURING THE CALENDAR YEAR 1918. Gx,rvo /: CasJhJteserres -required, agaXnsb J¥e&&eft^£&atod£j^,jfote£zabi^ com&&t£d>. dcrre Z:JobcuL Oxsh^cserpesofChe jTJi. 3cmfCs. 411 e2£t SiSUl <f lS222SS£192S3rOP&3t7HZI&SI2B26Z3 J6Z830 6B&B* ff J$K[ <f K&296132Q& JAM. 1 FEB. 1 MCH. 1 APR.\ MAYTTUJiEXJULr \ AUa\SEPT.\ OCT. I NOV. \DEC. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

No. 16.—Discounted paper held by each Federal Reserve bank on Dec. 27, 1918, distributed by maturities. fcO 00 Maturities. Federal Reserve bank. Total. Per cent. From 16 to 30 From 31 to CO From 61 to 90 > Within 15 days. days. days. days. Over 90 days. % Boston $41,255,264.00 $39,111,576.52 $38,800,112.69 $9,959,651.83 $1,015,882.27 $130,142,487.31 7.7 New York 486,415,574.61 115,634,349.59 41,937,316.41 8,386,712.57 876.00 652,374,829.18 38.3 Philadelphia.. 159,235,029.85 16,781,121.71 2,691,127.46 1,948,246.28 8,766.57 180,664,291.87 10.6 g Cleveland 87,618,601.59 30,192,822.48 8,719,990.21 1,579,437.31 33,848.52 128,144,700.11 7.5 Richmond 59,527,301.81 11,649,129.27 9,039,593.26 2,628,008.98 29,829.33 82,873,862.65 4.9 o Atlanta 55,683,990.66 10,881,437.16 7,038,707.77 3,375,714.63 184,548.17 77,164,398.39 4.5 Chicago 83,062,323.75 6,979,264.80 15,580,719.33 46,908,066.61 8,262,275.21 160,792,649.70 9.4 o St. Louis 52,215,249.85 4,624,999.48 5,911,166.23 2,804,453.23 22,443.87 65,578,312.66 3.9 Minneapolis.. 17,774,201.85 12,254,950.24 6,380,263.17 463,594.05 825,285.92 37,698,295.23 2.2 H Kansas City.. 30,372,556.77 4,347,744.99 7,874,734.30 4,657,505.54 9,145,437.62 56,397,979.22 3.3 w Dallas 26,437,281.8a 4,896,335.49 11,082,808.40 3,717,719.01 4,800,289.89 50,934,434.67 3.0 San Francisco 50,357,863.00 8,753,812.00 11,820,313.00 6,632,955.00 2,610,064.00 80,175,007.00 4.7 a Total... 1,149,955,239.62 266,107,543.73 166,876,852.23 93,062,065.04 26,939,547.37 1,702,941,247.99 100.0 g W O es Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

No. 17.—Acceptances purchased and held by each Federal Reserve bank on Dec. 'Zl\ 1918, distributed by maturities. Maturii ies Federal Reserve bank. Total. 'Within 15 days. From 16 to 30 From. 31 to 60 From 61 days to days. days. 3 months. Boston $6,,0 90., 932.96 $2, 892,847.73 $5, 596,322. $1,363,400. $15,943,503.37 New York... ,583,137.61 13, 725,176.79 27, 265,848. 2,748,884. 69,323,046.71 Philadelphia. ,188,459.64 293,516.92 1, 599,100. 167,194. 3,248,271.67 Cleveland ,287,336.00 346,498.32 11, 325,225. 1,316,752. 39,275,812.28 Richmond... 381,705.95 610,510.28 2, 108,650. 2,002,500. 5,103,366.23 Atlanta ,782,097.66 778,734.65 \ 046,709. 2,631,258. 12,238,800.28 Chicago 003,767.09 981,650.53 26 293,567. 3,789,095. 75,068,081.58 St. Louis ,455,901.23 449,106.00 2, 179,294. 740,000. 7,824,301.57 Minneapolis ,499,861.00 771,226.83 7, 740,911. 1,065,845. 20,077,844.09 Kansas City.... ,998,445.30 907,252.42 4 500,405. 996,670. 14,402,773.71 Dallas 765,000.00 645,000.00 818,000. 450,000. 2,678,000.00 San Francisco.. ,398,937.00 512,436.00 11, 405,799. 3,172,252. 38,489,424.00 Total...., 104,435,581.44 73,913,956.47 104,879,833.55 199,237,644.05 303,673,225.49 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

No. 18.—Acceptances purchased and held by each Federal Reserve Bank on Dec. 31, 1918, distributed by classes of accepting institutions. [In thousands of dollars, i. e., 000 omitted.J M ba e n m k b s e . r co m m N e tr p o m u a n s b n - t e ie r s. 1 m b N S e a t m n o a k n t b e s - e . r P b r a i n v k a s t . e b a F g r b o a e a a r n n n e n c c d i k i h g e e n s s . b a a a T c n n c o k c e t c e p a , s r l t . s , Domesti T c. r a 1 d e F a o c r c e e i p g t n a . nces. Total. Total. Boston 12,015 1 166 2,274 350 1 14,805 279 279 15,084 New York 48,081 ' 437 6,998 12,616 7,125 75,257 320 2,000 2,320 77,577 Philadelphia 2,824 62 30 69 6 2,991 20 20 3,011 Cleveland 29,313 2,246 1,084 1,674 863 35,180 2,216 49 2,265 37,445 Richmond 5,465 5,465 Atlanta 12,515 12,515 12,515 Chicago 60,447 1,359 1,075 62,881 62^881 St. Louis , 7,188 25 80 7,293 7,293 Minneapolis 17,281 223 440 50 17,994 17,994 Kansas City 12,329 1,163 292 420 14,204 14,204 Dallas 2,448 2,448 2,448 San Francisco 28,351 753 1,661 3,475 34,240 2,040 2,040 36,280 Totals: Dec. 31,1918.. 238,257 2,745 10,442 20,385 13,444 285,273 2,536 4,388 6,924 292,197 Nov. 30,1918.. 310,069 2,028 10,703 27,871 19,818 370,489 4,016 5,019 9,035 379,524 Oct. 31,1918... 314,719 2,949 11,669 30,242 ! 14,006 373,585 3,947 5,057 9,004 382,589 Sept. 30,1918.. 233,926 2,859 2,479 27,551 ! 13,999 280,814 2,745 5,761 8,506 289,320 Aug. 31,1918.. 188,366 1,717 8,264 19,167 8,450 225,964 2,201 6,605 8,806 234, 770 July 31,1918.. 154,614 1,129 7,302 18,082 8,975 190,102 1,994 5,787 7,781 197,883 June 30,1918.. 173,698 1,992 459 21,478 12,315 209,942 7,418 7,418 217,360 May 31,1918.. 207,917 1,330 5,168 26,217 8,398 249,030 8,276 8,276 257,306 Apr. 30,1918.. 248,390 654 2,907 25,921 10,304 288,176 128 9,151 9,279 29?, 455 Mar. 31,1918.. 275,144 1,360 1,884 31,779 8,562 318,729 23 7,992 8,015 326,744 Feb. 28,1918.. 252,747 1,648 3,856 28,419 7,097 293,767 5,456 299,223 Jan. 31,1918... 240,259 5,547 3,522 22,099 6,947 278,374 6,363 284,737 Dec. 31,1917.. 227,717 8,163 l 3,179 20,'l37 7,657 266,853 6,383 273,236 Dec. 30, 1916.. 66,803 | 34,625 1,502 18,224 121,154 4,585 ' 125,739 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

No. 19.— United Slates securities held by each Federal Reserve Bank on Dec. SI, 1918, distributed by classes and maturities. U. S. certificates of indebtedness.1 Federal Reserve Bank, 2 c o p n 1 e s 9 r o 30 l c s . e o n f t P 2 a p n er a m ce a n s t 4 J p o 1 e a 9 r n 2 5 c o . e f n t 3 l p o 1 e a 9 r n 0 1 c o . e l n t 3 b 1 v p o 9 e c 4 e n r o r 0 s d n i s c o 4 e n o 7 n f . t L l 3 o i 1 c ^ b a 9 e n e 4 p n 7 r t e o . t r y f 1 4 9 L l p 4 o i 2 e b a r n e 1 r c 9 o t e 4 y f n 7 t . I : 1 j L 4 l i | c o b e a p e n n e r t . r t y b T U o o n . t S d a . l s . T 3 n r p 1 e o - e a y r t e s e c s u a e . r r 1 y n t c o 2 t i f o r p c F e s u r e e l c d a c u t e e i r r o n e a n t l T c r O e er t a t h s i e f u i r r y T c T o a c r n t t e e a e o r l a s t t s i e U f a u s i n . r . y d S . sec T U u o . r t i S a ti l . es. Reserve cates. banknotes. Boston $:r,o $529,000 $0, $568,880 $1,105,230 $000,000 ! $7,410, 230 New York 1,255,400 $140,3,50 1,395,750 521,000 !$93,374,500:i28,S50: 250 Philadelphia.. $100 549,200 11,850 20, f,00 1,384,900 825,000 353, (XX) 10,033 900 Cleveland 414,800 200,200 403,550 1,084,550 1,202,000 1,005,500 11,725 050 Richmond 915,100 237,000 42,850 1,500 1,234, 200 81)9,000 4,784 200 Atlanta.. 240, 000 21,000 10,300 10,750 81,400 553, 750 607,000 102,000 0,000 750 Chicago , 1,802,500 307,300 $1,708,000 $400 427,400 S50 4,509,500 1,445,000 15,012 500 St. Louis... 100 1,153,300 1,153,400 0, 508 400 Minneapolis... 260 500 114,800 4,970 120, 530 530,000 200,500 5,140 030 Kansas City.... 7,155,000 20,000 82*,000 838,500 19,950 j 8, (XX) 8,808,450 821,000 58,000 4,378 450 Dallas.. 2,450,900 281,500 1,233,000 600 | ,100 22,100 3,989,800 725,000 500,000 4,400 800 San Francisco.. 2,428,750 5,050 | ,150 I 2,400,950 1,000,000 970,000 5,724 950 Total.... ,5,053,700 927,100 ;2,593,000 900 10,520,300 503,000 1,130,500 1,117,850 ,27,859,010 19,301,000 104,707,000 90,095,500 ,210,703,500 238,502,510 Amount of LTnited States bonds with circulation privilege: Amount of United States securities without circulation privilege: 2 per cent consols and Panamas $15,980,800 3 per cent loan of 1901 $900 4 per cent loan of 1925 2,593,000 3 per cent conversion 1 >onds... 0,52o, 300 3* per cent Liberty loan 503,000 Total. 18,5 4 per cent Liberty loan 1,130,500 '\{ per cent Liberty loan 1,117.850 3 per cent 1-year notes * , 9,301,000 2 per cent certificates of indebtedness 2 104,707,000 other Treasury certificates of hidebtedness - 90,095,500 Total 219,988,050 1 Circulation privilege for Federal reserve bank notes only. - Includes unpaid portion of bonds sold to individual subscribers, other thau employees, on partial payment plan. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

No. 20.— United States securities held by each Federal Reserve Bank on Dec. 31, 1917, distributed by classes arid maturities. Feder B al a n R k e . serve 2 c o p n 1 e s 9 r o 3 l c 0 s e . o n f t P 2 1 a 9 p n 3 e a 6 r - m 1 c 9 a e s 3 n 8 t o . f 3 l p o 1 e a 9 r n 1 c 8 o e . f n t 4 l p o 1 e a 9 r n 2 c 5 o . e f n t 3 l p o 1 e a 9 r n 6 1 c o . e f nt c 3 o b p n o v n e e r d r s c s e o io n f n t 3J " - l L o p i a e b n r e o r c t f y e nt 4 L l p o i e b a r n e c r o t e f y n t To b t o al n U ds . . S. 3 p n 1 o - e y r t e e c a s e . r nt t i i U n f . i d c S e a b . t e t c s e e d r o f T c a e n o r d t t a i T f l i r c U e a a t . e s S s - . 1 T se o c t u al r i U tie . s S , . 1946-47. 1947. 1942-1947. ness. ury notes. Boston S750 $529,000 $80,000 i $118,992 $728,742 $2,194,000 $2,194,000 i $2,922,742 New York 50 ,$50,000 1,255,500 411,150 3,470,150 5,186,850 4,493,000 $15,000,000 19,493,000 24 679,8.50 Philadelphia $100 549,200 249,850 6,302,800 7,101,950 2,548,000 2,548,000 9 649,950 Cleveland 6,400 467,200 2,653,660 $2,378,200 414,800 2,027,000 320,750 8,268,010 3,221,000 28,050,000 31,271,000 39,539,010 Richmond 915,100 237,000 42,900 41,450 1,236,450 1,969,000 1,969,000 A tlanta 640,600 21,000 10,300 290,900 1,434,200 2,397,000 1,491,000 1,491,000 3 888 000 Chicago 1,882,500 367,300 2,581,000 1,768,000 $400 427,400 7,006,600 3,378,000 3,378,000 10 384,600 ! St. Louis 100 1,080,000 1,153,300 . 2,233,400 1,444,000 1,444,000 3 677 400 Minneapolis 323,050 10,260 1,199,180 206,250 500 114,800 " 27,950 1,887,990 1,340,000 500 1,340,500 3 22S 490 Kansas City 7,155,850 22,240 825,000 838,500 7,500 8,849,090 1,784,000 1,784,000 10 633 090 Dallas 2,450,900 281,500 1,233,600 477,100 53,000 4,496,100 1,430,000 1,430,000 5 926 100 San Francisco 2,428,750 28,250 2,455,000 1,500,000 1,500,009 3,955,000 Total 15, 784,050 1,412,600 7,563,840 5,177,450 900 6,526,400 3,612,650 11,769,292 51,847,182 26, 792,000 43,050,500 69,842,500 121,689,682 Amount of United States bonds with circulation privilege: Amount of United States securities without circulation privilege: 2 per cent consols and Panamas $17,196.650 3 per cent loan of 1961 $! 00 3 per cent loan of 1918 7,563.840 3 per cent conversion bonds 6.526,400 4 per cent loan of 1925 5,177,450 3 per cent 1-ycar notes 26,792,000 3Vper cent Liberty loan 3,612,6S0 Total 29,937,940 4 per cent Liberty loan 11,769,292 U. S. certificates of indebtedness 43,050,500 Total 91,751,742 'Includes unpaid portion of bonds sold to individual subscribers, other than employees, on partial-payment plan. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

No. Zl*+~ Statement showing condition of each Federal Reserve Bank on Dec. 31,1918, 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. W i H Gold bullion and coin $2,705,260.00 $79,140,305.83 Gold certificates (including clearing-house certificates) 612,000.00 177,624,720.00 $1,051,330.00 Gold coin and certificates $3,317,000.00 1256,765,000.00 SI.051.W0.00 O Gold settlement fund, Federal Reserve Board 37,292,607.33 37,293,000.00 66,790,455.76 66,790,000.00 37,412.406.54 37,412,000.00 o Gold with foreign agencies 408,021.21 408,000.00 2,010,961.70 2,011.000.00 408.021.21 408,000.00 o H Total gold held by banks 41,018,000.00 325,566,000.00 38.871,000.00 o Gold with Federal Reserve agents 59,733,330.00 59,733,000.00 274,392,165.00 27 fh 392,000.00 85,583,245.00 85,584,000.00 o Gold redemption fund 7,812,380.00 7,813,000.00 25,000,000.00 25,000,000.00 7,900,000.00 7,900,000.00 *j Total gold reserves 108,564,000.00 624,958,000.00 132,355,000.00 w Silver certificates (including clearing-house certificates) 785,881.00 4,496,708.00 991,194.00 Legal-tender notes (including clearing-house certificates) 1,352,888.00 43,038,200.00 639,900.00 > Silver coin 149,024.10 35,268.85 36,552.00 Legal-tender notes, silver, etc * 2,288,000.00 47,570,000.00 1,668,000.00 w ui 110,852,000.00 672,528,000.00 134,023,000.00 Member banks7 collateral notes, secured by Government war 41,966,950.00 493,327,164.58 135,032,810.41 Other bills discounted, secured by Government war obligations..... 78,548,716.97 159,240,510.14 24,731,638.46 > 120,516,000.00 652,568,000.00 159,764,000.00 Member banks' collateral notes, secured otherwise than by Govern- ui 225,000.00 Other bills discounted, secured otherwise than by Government war obligations and unsecured 12,834,656.44 44,773,780.97 19,055,512.83 00 Co Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

No. 21.—Statement showing condition of each Federal Reserve Bank on Dec. 31,1918—Continued. CO RESOURCES—Continued. 1 Boston. New York. Philadelphia. Bills discounted, all other $13,060,000.00 $44,774,000.00 $19,056,000.00 Bills bought in open market $15,084,299.96 15,084,000.00 $77,576,632.94 77,577,000.00 $3,011,280.08 3,011,000.00 > Total bills on hand 148,660,000.00 774,919,000.00 181,831,000.00 w United States Liberty loan bonds owned 140,350.00 o Other United States bonds owned 537,750.00 1,255,400.00 1,384,900.00 United States liberty loan bonds sold on installment plan 567,480.00 w United States Government long-term securities 1,105,000.00 1,396,000.00 1,385,000.00 O One-year Treasury notes 666,000.00 521,000.00 825,000.00 United States certificates of indebtedness to secure circulation 6,750,000.00 34,955,000.00 8,855,000.00 W United States certificates of indebtedness purchased under re- 5,325,500.00 Other United States certificates of indebtedness 88,049,000.00 353,000.00 United States Government short-term securities 7,416,000.00 128,851,000.00 10,033,000.00 Total earning assets 157,181,000.00 905,166,000.00 193,249,000.00 Due from foreign banks 6,770,374.11 Exchanges for clearing house 10,210,006.56 26,124,422.22 12,930,622.04 Checks and other cash items 338,459.46 10,277,069.56 20,627,671.25 National-bank notes and notes of other Federal Reserve Banks 3,650,890.00 5,536,500.00 3,737,000.00 Mutilated currency (other than own Federal Reserve notes) for w warded for redemption 1,385,050.00 2,319,865.00 o Bills discounted in process of collection 453.00 > Uncollected items: Federal Reserve Banks 30,235,182.84 95,209,734.00 41,527,G84,40 Member and nonmember banks and bankers 22,673,324.08 50,526,443.53 12,029,710.01 Uncollected items and other deductions from gross deposits 68. m, 000. 00 196,764.000.00 90,853,000.00 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

6per cent redemption fund against Federal Reserve Bank notes 320,100.00 | I'J, 000.00 1,639,250.0.) | 1,089,000.00 sOOO.OO 475, 00). 00 Reimbursable expenditures: Capital Issues Committee 1,322.37 7,349.94 5,427.65 Liberty loans „ , 481,201.77 2,803,100.SO 611,889.10 War savings stamps 70,407. G6 179,079.31 141,442.76 Nickels and cents 0,372.30 349.95 271.16 Liberty loan bonds sold on installment plan 1L37L.O0 Liberty loan bonds purchased from subscribers 51,950.00 Subscription account—employees , 14, KX). 00 Cost of delivering conversion bonds 13,137.48 Bank premises 800,000. (X) 2,317,692.39 | 500,000.00 j. Repairs and alterations, remodeling account; 11,740.39 .Furniture and equipment 11,565. &3 Cost of unissued Federal Reserve currency 75,179.92 Overdrafts—member banks 30,400.15 59,024.31 Unearned discount—suspense 73,241.51 Difference account 0,408.23 77,275.60 !... 1,658.72 Internal-revenue stamps - 60.86 I... All other resources,. 1,528,000.00 5,497,000.00 1,404,000.00 Total resources. 338,374,000.00 1 1,781,044,001). 00 4 >o,004,000.00 Cleveland. Richmond. Atlanta. Gold bullion and coin 1,051,565.00 584,860.00 1,900,488.42 ' Gold certificates (including clearing house certificates).. 12,202,620.00 1,773,610. (X) ; 6,086,890.00 \ Gold coin and certificates 13,257,000.00 2,359,000.00 7,987,000.00 Gold Settlement Fund, Federal Reserve Board 2,125,485 53,120, 000. 00 14,253,728.99 j 14,254,000.00 6,302,193.45 j 6,302,000.00 Gold with foreign agencies , 524,598 525, W0.00 204,010.61 | 204,000.00 174,866.23 I 175,000.00 Total gold held by banks., 65,908,000.00 10,817,000.00 14,404,000.00 Gold with Federal Reserve Agents. 138,277,370.00 138,277,000.00 62,990,765.00 j 62,991,000.00 42,179,185.00 42,179,000.00 Gold Redemption Fund 1,368,280.00 1,308,000.00 5,368,300.00 j 5,308,000.00 6,957,760.00 6,958,000.00 Total gold reserves. 205,553,000.00 85,170,000.00 63,601,000.00 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

No. 21.—Statement showing condition of each Federal Reserve Bank on Dec. 61,1918—Continued. CO RESOURCES—Continued. OS Cleveland. Richmond. Atlanta. > Silver certificates, including clearing house certificates $257,802.00 887,877.00 $55,544.00 Legal tender notes, including clearing house certificates 864,852.00 134,750.00 165,009.00 > % Silver coin 4,309.55 916.45 16,690.50 Legal tender notes, silver, etc $1,127,000.00 $223,000.00 $237,000.00 Total reserves 206,680,000.00 85,399,000.00 63,838,000.00 O Member banks' collateral notes, secured by Government war obliga- H 77,269,400.00 58,008,847.72 46,378,086.57 Other bills discounted, secured by Governemnt war obligations 37,944,593.32 14,425,484.03 7,792,942.04 Bills discounted, secured by Government war obligations 115,214,000.00 72,435,000.00 54,171,000.00 Member banks' collateral notes, secured otherwise than by Govern- 70,000.00 56,350.00 1,248,713.43 Other bills discounted, secured otherwise than by Government war w o 12,051,188.32 13,750,590.90 28,615,768.89 w Bills discounted, all other 12,121,000.00 13,807,000.00 29,864,000.00 > Bills bought in open market 37,445,215.53 87,U5,000.00 5,465,166.23 5,465,000.00 12,514,685.61 12,515,000.00 w Total bills on "hand 16/f,7SO,000.00 91,707,000.00 96,550,000.00 w United States bonds to secure circulation 261,600.00. Other United States bonds owned 1,084,550.00 1,234,200.00 292,150.00 United States Government long-term securities 1,084,000.00 1,234,000.00 554,000.00 w One-year Treasury notes 1,202,000.00 899,000.00 667,000.00 o United States certificates of indebtedness to secure circulation . 9,458,000.00 3,885,000.00 5,297,000.00 Other United States certificates of indebtedness 1,065,500.00 102,000.00 11,726,000.00 4,784,000.00 6,066,000.00 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

13,000.00 13,000.00 Total earning assets 17 7, M0,000,00 97,72,5,000.00 103,183,000.00 E xchanges for clearing house 9,091,063.81 5,435,763.87 2,876,114,04 Checks and other cash items..., 5,733.68 140,093.54 122,324.66 National bank notes and notes of other Federal Reserve Banks 4,275,119.00 5,918,780.00 4,119,829.00 20,500,680.07 Uncollected items Federal Reserve Banks—Transfers bought, net 540,000.00 Other items 28,065,337.43 0, 981, 436.18 Branches and offices 4,141,886.81 3,115,570.09 2,518,975.61 Member and nonmember banks and bankers 16,270,945.31 43,092,369. 75 10,399,909.62 Miscellaneous 439,868. 43 62,830,000,00 78,203, 000.00 36,010,000.00 5 per cent Redemption Fund against Federal Reserve bank notes 531,800.00 532,000.00 309,900.00 310,000.00 310,690.00 511,000.00 Reimbursable expenditures: Capital Issues Committee 3.00 647,-554.09 154,937.84 327,688.93 War Savings stamps 114,822.09 71,137.94 128,519.28 695.38 1 13.53 ; 1,336.40 Liberty Loan bonds sold on installment plan 24,300.00 290,000.00 : 217,000.00 Overdrafts—member banks 1, 725. 73 168,622.52 j ' I Difference account 1,506.01 All other resources 789,000.00 686,000.00 674,00°-00 Total resources , 448,421, ooo. oo 262,323,000.00 " 204,025,000.00 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

No. 21.—Statement showing condition of each Federal Reserve Banh on Dec. 31, 1918—Continued. RESOURCES—Continued. Chicago. St. Louis. Minneapolis. Gold bullion and coin . $49,140. 00 $2,172,390.00 Gold certificates (including clearing house certificates) 23,185,045. 00 §4,056,010.00 6,150, 720.00 Gold coin and certificates $23,234,000.00 $4,056,000.00 $8,323,000. 00 Gold settlement fund. Federal Reserve Board r 106,772,373,57 106,773,000.00 12,474,094.52 12,474,000.00 23,774,414,92 23,774,000.00 Gold with foreign agencies 816,042.43 818,000.00 233,154. 97 233,000.00 233,154,97 233,000.00 Total gold held by banks , 130,823,000.00 16,763,000.00 32,330,000. CO Gold with Federal Reserve agents 275,803,010. 00 27 o,803,000.00 66,673,935.00 66,674,000.00 55,868,410.00 55,869,000.00 Gold redemption fund 15,151,205.00 15,151,000.00 3,369,850.00 3,370,000.00 4,948,850.00 4,949,000.00 Total gold reserves 421,777,000.00 86,807,000.00 93,148,000.00 751,132.00 1,280,876. 00 33,055.00 Legal tender notes, including clearing house certificates 1,012,000.00 991,500.40 38,620.00 Silver coin, 34,200.00 177,574.00 1,170.00 Legal tender notes, silver, etc ,.., 1,797,000.00 2,450,000,00 73,000.00 Total reserves 423,574,000.00 89,257,000.00 93,221,000. GO Member banks' collateral notes, secured by Government war obliga tions.., 98,758,687,50 49,213,-300.00 16,950,450.00 Other bills discounted, secured by government war obligations 11,412,539.34 3,904,341.50 14,577,872.67 Bills discounted, secured by Government war obligations 110,171,000.00 53,118,000.00 31,528,000. 00 Member banks' collateral notes,secured otherwise than by Govern ment war obligations 10,498,637.45 240,000.00 17,000.00 Other bills discounted, secured otherwise than by Government war obligations and unsecured 43,419,233.65 17,345,012.35 5,126,620.98 Bills discounted, all other 53,918,000.00 17,585,000.00 6,144,000.00 Bills bought in open 'market 62,880,918.85 62,881,000.00 7,293,087. 96 7,293,000.00 17,993,757.63 17,994 000.00 Total bills on hand 226,970,000.00 77,996,000.00 54 666 000.00 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

United States bonds to secure circulation 3,997, 800. 00 j Other United States bonds owned 511, 700. 00 1,153, 400. 00 115,560.00 United States Liberty loan bonds sold on installment plan 4,970.00 United States Government long-term securities l,15/h000.00 One-year Treasury notes 1,445,000.00 530,000. 00 X United States certificates of indebtedness to secure circulation. 14,107,000.00 0,568, 000. 00 4,350,000. 00 5 s Other United States certificates of indebtedness 200,500.00 United States Government short-term securities 15,612,000.00 l. 0,508,000. 00 i-H Total earning assets.. 85,718,000.00 59,933,007>. 00 Exchanges for clearing house 6, 053,550. 57 1,735,820.80 2,008,841.15 j. o Checks and other cash items 038,107. 50 260,988.02 |. National bank notes and notes of other Federal "Reserve Banks, 3,819,300.00 3,921,420,00 375,135.00 i. Uncollected items: Federal Reserve Banks—Transfers bought, net............. <;, 505,000.00 1,100,000.00 2,031,500.00 Other items 44,014,081.47 23,792,190.40 2,917,434.00 Branches and offices 830, G73. 08 20,772,135.50 Member and nonmember banks and bankers 10,234,373. SI 7,470,757.72 5,470,805.82 Transit sundries 10C,130.81 Uncollected items and other deductions from gross deposits 78,230,000.00 ' 59, 430, 000.000' 13,124,000.00 5 per cent Redemption Fund against Federal Reserve Banknotes.... S29,390,00 829,000.00 : 317, 400. 00 317,000.00 230,200.00 i 233,000. OQ Reimbursable expenditures: Liberty loans 1,300,811.88 421,793.10 139,314.95 |. War Savings stamps 21 719.53 20, 430. 73 10,897.39 L Advances, war savings, and Liberty loan 12,000.00 ;. Nickels and cents 212.90 10.85 L Liberty loan bonds % $10 participation certificates 9,450.00 Bank premises 2,936,149.26 Vault account 29, 500. 00 Furniture and equipment 7,182. 19 1.00 ! Overdrafts—member banks en Difference account. 115.09 A11 other resources. 4,360,000.00 4:4,000.00 J_ Total resources... ; !...754,0S4,000.00 100,707,000.00 Co Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

No. 21.—Statement showing condition of each Federal Reserve Bank on Dec. 31, 1918—Continued. RESOURCES—Continued. i Kansas City. ' Dallas. San Francisco. Total. 1 Gold bullion and coin $3,472.50 ! $73,792.50 $7,701,370.00 $95,385,644.25 Gold certificates (including clearing house certificates).. 151,710.00 1 5,648,000.00 4,490,130.00 243,032,785.00 $155,000.00 $5,722,000.00 $12,192,000.00 $338,418,000 Gold Settlement Fund, Federal Reserve Board 23,236,521.55 23,237,000.00 6,923,261.30 6,923,000.00 11,056,184.32 11,056,000.00 398,413,727.60 308,414,000 Gold with foreign agencies 291,443.73 291,000.00 204,010.61 204,000.00 320,588^00" 321,000.00 5,828,874.47 5,829,000 Total gold held by banks 23,683,000.00 23,569,000.00 742,661,000 Gold with Federal Reserve agents 54,483,690.00 54,484,000.00 22,352,295.00 22,352,000.00 |125,614,335.00 125,614,000.00 1263 95173500 1,263 952 000 Gold Redemption Fund 3,590,042.20 3,590,000.00 2,193,350.00 2,193,000.00 j 1,789,405.00 1,789,000.00 85,449,422.20 85 449 000 Total gold reserves 81,757,000.00 37,394,000.00 150,972,000.00 2,092,062,000 Silver certificates, including clearing house certificates.. 59,594.00 174,519.00 317,090.00 9,291,272.00 Legal tender notes, including clearing house certificates. 38,187.00 267,700.00 195,128.00 48,738,734.40 3,680.00 931,674.00 6,420.35 1,397,479.80 101,000.00 1,374,000.00 519,000.00 59,427,000 81,858,000.00 38,768,000.00 151,491,000.00 2,151,489,000 Member banks'collateral notes, secured by Government war obligations 19,875,419.19 12,185,107.50 45,021,583.00 1,093,987,706.47 Other bills discounted, secured by Government war 623,170.66 2,210,899.15 4,428,010.00 159,840,718.28 obligations Bills discounted, secured by Government war obligations... 20,499,000.00 14,395,000.00 49,4-50,000.00 . 1,453,829,000 Member banks' collateral notes, secured otherwise than by Government war obligations 8,203,888.30 829,072.50 3,000.00 21,391,661.68 Other bills discounted, secured otherwise than by Gov- 28,751,159.24 30,300,457.49 29,306,835.09 285,330,817.15 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Bills discounted, all other 36,9-55,000. 00 $tft 30,000.0B 29,30r), 000.00 .... i 306,723,000 Bills bought in open market,. 14,203,695.36 14,203,000.09 2,448,000.00 S, 448,000.09 36,279, 726. 68 56, 280,000. 00 |292,196,466. S3 292, 196,000 Total hills on hand, 71,6,57,000.00 47,073,000.09 115,030,000.00 2,052,748,000 United States I liberty loan bonds owned 140,350.00 j X United States bonds to secure circulation 8,000,000.00 I 2,732,400.00 2, 428,750.00 17,420,550.00 ! Other United States bonds owned 866,450.00 | 1,233,600.00 32,200.00 9,701,860.00 w United States Liberty loan bonds sold on installment H plan 23,800.00 596,250.00 O United States Government long-term securities '' 8,806,000.00 , !W, 000.00 2,461,009.00 27,859,099 o One-year Treasury notes 821,000.00 ' 725,000.00 1,000,000.00 9,301,000.00 ; o United States certificates of indebtedness to secure cir culation 3,499,000.00 3,175,000.00 3,748,000.00 104,707,000.00 \ United States certificates of indebtedness purchased J under repurchase agreement 5,325,500.00 j o Other United States certificates of indebtedness ' 58,000.00 500,000.00 976,000.00 91,370,000.00 j o United Stales Government short-term securities 4, 318,000.00 I 4,400,000.00 5,724,000.00 210,704,000 Municipal warrants 13,000.00 All other earning 13,000 Total earning assets. I 84,901,000.09 56,363,000.09 \ 1123,224,000.00 2,291,324,000 Due from foreign banks 6,770,374.11 Exchanges for clearing house 980,343. 93 460,642.64 4,346,941.92 82, 920,133.61 j Checks and other cash items , 833,538.39 11,980.99 33,255,967.11 l National bank notes and notes of other Federal Reserve banks ,839,565.00 ; 749,470.00 6,478,036.00 44,421,044.00 < Mutilated currency (other than own federal Reserve notes) forwarded for redemption 259,250.00 19,000.00 3,983,165.00 W> Bills discounted in process of collection 453.00 Depositaries 20,500,680.07 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

No. 21.—Statement showing condition of each Federal Preserve Bank on Dec. SI, 1918—Continued. RESOURCES—Continued. Kansas City. Dallas. San Francisco. Total. Uncollected items: Federal Reserve banks—Transfers bought, net $9,877, 492.89 $4,690,917.04 $3,595,213.00 $28,400,122.93 Other items 12,385,455.34 7,593,248.99 13,348,136.67 309,070,527. 72 Branches and offices 11,053,783.48 339,086.13 7,609,042.97 50,987,154. 27 Member and non-member banks and bankers 27,302,389.47 7,803,195.97 9,263,172.56 234, 543, 457.65 United States Government Special account 33.06 33.00 Dallas clearing house 9,441.37 9,441.37 Dallas clearing house suspense account 1,343,529.94 1,343,529.94 Transit sundries 106,136.81 Miscellaneous - 3,180.01 443,048.44 Uncollected items and other deductions from gross deposits, 34,879,000.00 \$23,252,000,00 \$U, 672,000.00 6% Redemption Fund against Federal Reserve bank notes, 505,600.00 566,000.00 311,600.00 312,000.00 356,400.00 356,000.00 6,253,630.00 Reimbursable expenditures: Capital Issues Committee . 1,844.30 1,819.32 10,173. 77 27,940.35 War Finance Corporation 358.00 358,00 Cattle Loan Agency 1.47 1.47 Liberty Loans 449,452.85 506, 737.46 855,321.64 8,819,804.47 War Savings Stamps 67,581.80 838,038. 49 Advances, War Savings and Liberty loan 12,000.00 Nickels and cents 514. 43 36,343.24 574.32 65,302.97 Liberty loan bonds sold on installment plan 1G,749.50 52,420.50 Liberty loan bonds purchased from subscribers 51,950. 00 Subscription account—employees 14,160. 00 Liberty loan bonds a/c $10 participation certificates 10,450.00 Cost of delivering conversion bonds 13,137. 48 Bank premises 500,000.00 282,519.70 619,600.35 8,462,961.70 Repairs and alterations, remodeling account...., 11,740.39 Vault account 29,500.00 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Furniture and equipment 11,000.00 I. 32,980.15 62,734.97 Furniture and equipment—recoverable.... 0,875.00 ! 6,875.00 Cost of unissued Federal reserve currency. 155,170.45 230,350.37 Overdrafts—member banks 1I9,&->4.!W ' 295,808.82 ! 329.180. 29 1,035,630.20 Unearned discount—suspense 73,241.51 Difference account . 3, 988. 79 ! 95,374.32 Internal Revenue stamps , 00.80 Interest accrued on surrendered stock 108.50 All other resources 1,099,000.00 1,1*5,000.00 \ I 2,075,000 00 i J 9,914,000.00 Total resources ' 2,ti, 30.1, 000.00 ! . lift,830,000.00 • ll? 1.8 IS, 000.00 ' ,2S5.7S5J)00.00 LIABILITIES. Boston. New York. Philadelphia. T Capital, paidin. $<», 691,750.00 I $20,805,100.00 $7,502,300.00 | Capital—Suspense account | ... 15,000.00 150.00 I Capitalpaid in ;.;... $0,(192, (MM). 00 j $20,820,000.00 '• $;,5t;3,000.u0 Surplus 75,100.00 75,000.00 \ 649,303.50 049,000.00 ' United States Government deposits—General account., 10,499,061.50 5,010,891.40 5,039,128.17 !. United States Government deposits—Special account.. 94,737. 70 Government deposits 10,499,000.00 j 5,700,000.00 < : 5,039,000.00 Due to member banks—Reserve account 101,830,9(H). 74 101,837,000.00 \ 705,002,001.27 705,062,GOO.CH) j 99,720,124.95 j 99,': 20,000.00 Cashier's, expense, return item, and dividend checks.. 217,590.24 ! 4,852,515.03 ! : 822,911.05 Federal Reserve Bank drafts 140,404.01 ..... •. Federal Reserve exchange drafts .v. 20,344.41 j 125.00 Federal Reserve transfer drafts 173,483.33 \ Collection items—Credits: I Goldsettlement fund—Suspense 17,407,049.53 \ 78,980,137.20 19,445,515.80 j Federal Reserve banks— Transfers sold, net 25,125.00 Other items 8,014,080.42 i. 0,934,425.41 5,993,052.38 Member and nonmember banks 21,948,4.80.84 '. 72,173,899.90 22,631,973.89 Miscellaneous O.sOO, 74 L 17,821,671.44 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

No. 21.—Statement showing condition of each Federal Reserve Bank on Dec. 31, 1918—Continued. LIABILITIES—Continued. Boston. New York. Philadelphia. j i $47,848,000.00 | $163,094,000.00 ! $66,740,000.00 Foreign G overnment and bank credits ! \ $95,976,172.85 i 1 ! Due to nonmembers, clearing account ' \ 4,478,815.06 ! ! War Finance Corporation ! 903,392.23 Other deposits, including foreign Government credits 1 .. -. 101,358,000.00 i . 1 Total gross deposits 160,184,000.00 975,220,000.00 171,499,000.00 $168,986,330.00 819,015,835.00 $241,870,745.00 Less: Federal Reserve notes on hand 6,962,500.00 89,188,235.00 11,739,400.00 Mutilated Federal Reserve notes forwarded for redemption 1,297,710.00 3,270.00 1,019,340.00 Total deductions 8,260,210.00 89,191,505.00 12, 758, 740.00 Federal Reserve notes in actual circulation 160,726,000.00 729,824,000.00 229,112 000 00 Federal Reserve bank notes 6,889,000.00 ; 33,785,000.00 9,258,200.00 Less Federal Reserve bank notes on hand 507,100.00 1 751,000.00 332,037.00 Federal Reserve bank notes in circulation, net liability 6,382,000.00 33,034,000.00 8,926,000.00 All other liabilities: 698,539.94 9,017,159.97 643,279.28 Discount earned—Bills discounted 2,013,817.88 11,792,922.51 2,538,653.05 Discount earned—Acceptances bought 606,*962.05 2,569,199.62 361,728.37 Interest earned—Municipal warrants 254.35 Interest earned—United States securities 57,007.33 510,108. 58 77,627.48 Unearned discount—Bills discounted 413,423.61 1,017,202.54 192,234.93 Unearned discount—Acceptances bought 54,426.40 254,986.84 31,573.20 41,821.34 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

10,058.22 11,110.37 20,692.07 16,638.33 Penalties on deficient reserves—Suspense 2,449.07 | ! o 629. 70 o 59.50 913. 58 w Discount on United States bonds 6,875.00 J W Discount profit on bills sold 9,195.50 Income, real estate 23,971.11 H Sundry profits 24,466.06 56,378. 21 11,001.83 Reserved for sundry expenses 525.00 Reserved for depreciation on United. States bonds 89,591.66 Depreciation reserve account 205,880.00 O Reserved for interest on real estate mortgage 3,750.00 Mortgage, real estate 750,000.00 Due to Liberty Loan subscribers in default 36,297.52 O Participation certificates, Liberty Loan bonds 34,410.00 Contracts to deliver Liberty Loan bonds sold 283.00 Total 4,796,451.95 25,535,942.51 3,875,710.54 Less all other resources: Interest accrued on United States securities 33,133.69 172,878.27 43,309. 74 > E xpense current 346,491.68 1,793,645.38 707,464.90 Disbursements—Transit Department 101,529.38 1 Exchange paid 23.10 32.00 Other deferred charges 864,269.34 4,519.66 Tfl Dividend account, including premium on surrendered stock 35.00 608,754.22 216,825.56 Total 481,212. 85 3,439,547.21 972,151.86 > 4,815,000.00 22,097,000.00 2 904,000 00 Total liabilities 338,874,000.00 1,781,644,000.00 420„004,000.00 £* CA Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

No. 21.—Statement shouting condition of each Federal Reserve Bank on Dec. 31,1918—Continued. LIABILITIES—Continued. Cleveland. Richmond. Atlanta. Capital paid in $9,072,700.00 $9,073,000.00 $4,062,200.00 $4,062,000.00 $3,191,350.00 $8,191,000.00 Surplus 116,471.73 116,000.00 40,000.00 40,000.00 United States Government deposits—General account 749,987.69 2,795,094.97 2,839,711.85 United States Government deposits—Special account 20,500,680.07 Government deposits ' 750.000.00 23,296,000.00 2,840,000.00 Due to member banks-^Reserve account 123,161,329.85 123,161,000.00 54,161,937.72 64,162,000.00 46,222,851.15 46,223.000.00 Cashier's, expense, return item, and dividend checks 192,616.86 111,319.95 79,606.72 Federal Reserve exchange drafts 3,455.73 Collection items—Credits: 10,177,014.24' 11,682,321.27 6,973,458.15 Federal Reserve Banks l 6 ,070,770.19 12,512,777.25 5,199,568.72 Branches and offif^s- r.. . x ^x _ 288,065.10 375,302.29 Member and nonmember banks 22,424,447.06 12,419,061.03 9,013,287.09 Miscellaneous 10,909,174.91 939.86 1,746,856.82 Collection items 49,777,000.00 87,015,000.00 28,388,000.00 40,931.30 Other deposits, including foreign government credits 41,000.00 Total gross deposits 173,688,000.00 114,473,000.00 72,499,000.00 Federal Reserve notes outstanding 266,519,915.00 150,997,770.00 123,620,285.00 Less: Federal Reserve notes on hand 14,147,660.00 12,937,890.00 2,786,200.00 Mutilated Federal Reserve notes forwarded for redemption 589,720.00 581,850.00 161,655.00 Total deductions . j 14,737,380.00 13,519,740.00 2,947,855.00 Federal Reserve notes in actual circulation ... J Ml, 783,000.00 137,478,000.00 120,672,000.00 Federal Reserve bank notes i 10,600,000.00 4,276,000.00 6.085,600,00 Less Federal Reserve bank notes on hand .. . . 869,385.00 270,500,00 | 269,000.00 Federal Reserve bank notes in circulation, net liability i 9,731,000.00 , 4,008,000.00 6,816,000.00 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

All other liabilities: I Profit an d loss 1,120,241.72 |. "13,198.00 423,165.68 Discount earned—Bills discounted 1,819,206.27 j. 2,390.421.93 1,401,826.29 "Discount earned—Acceptances bought 805,383.77 L 273.033.68 168,477.53 Interest earned—Municipal warrant s 863.24 Interest earned—United States securities 147,139.24 j 38,759.19 Interest earned—Rediscounts other Federal Reserve banks. 357,364.03 ! Unearned discount—Bills discounted 155,301.42 ' 151,471.27 163,639.75 j Unearned discount—Acceptances bought 105,547.86 39,096.13 64,460.60 | Unearned interest—Municipal warrants 75.11 ! Unearned interest—Rediscounts Federal Reserve banks... 53,271.80 i Transfers bought and sold, net charges 33,326.10 j 16,111.91 Profits realized on United States securities 141,551.45 ! 4,349.50 Penalties on deficient reserves 39,857.88 122,653.93 20,370.45 Discount on United States bonds S30.70 Service charges, net 49,064.71 : Sundry profits 10,587.97 |. 59,836.11 ; 2,920.43 Difference account 802.52 |. 62.23 : 460.76 Reserved for sundry expenses 63,198.00 ! 47,572.19 Contracts to deliver Liberty Loan bonds sold 13,128.00 ! Total., 4.802,710.03 ! 3,219,67 2,353,933.33 Less all other resources: Interest accrued on United States se-cur: 58,514.53 22,159.86 ! 24,961.80 Expense current 574,653.12 519,526.06 j 512,532.58 Disbursements—Transit department... 134.294.01 ! Exchange paid 51.81 Other deferred charges 22,055.31 122.829.16 | 2,957.31 Dividend account, including premium < i surrendered stock. 900.25 232,431.94 | 38-87 Total., 656.1"5 02I 1 L^l -Ml ()> 540.490.56 i All other liabilities, mi. 't ' 'H O'JQ UO J tod OuO u0 .1 l,3Li,000.00 Total liabilities,, ,'i OsJ >JJ it <• j LJO o) .\ 2O.'tMo,QQ0.GQ a Lubit Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

No. 21.—-Statement showing condition of each Federal Reserve Bank on Dec. ,31,1918—Continued. LIABILITIES—Continued. 00 Chicago. St. Louis. Minneapolis. Capital paid in $11,123,100.00 $3,799,600.00 $2,931,200.00 ! Capital—Suspense account 61,950.00 Capitalpaid in $11,185,000.00 I $3,800,000.00 $2,931,000.00 Surplus 215,799.18 216,000.00 ! 37,500.00 38,000.00 w United States Government deposits—General account. 0,565,412.66 3,333,007.84 5,191,471.43 United States Government deposits—Special account 877. 44 O Government deposits 6,566,000.00 i 3,333,000.00 5,191,000.00 Due to member banks—Reserve account 230,604,383.69 230,604,000.00 j 52,830,678.16 52,831,000.00 48,825,966.37 48,826,000.00 O Cashier's, expense, return item, and dividend checks S46,466.40 181,985.13 302,513.37 Federal Reserve bank drafts 1,560,218.78 H Federal Reserve exchange drafts 8,463.40 2,121.10 ft H Federal Reserve transfer drafts 63,000.00 Collection items—Credits: Gold settlement fund—Suspense 14,743,259.20 7,484,495.01 1,101,434.14 a w Federal Reserve banks—Transfers sold, net 3,700,116.20 400,000.00 w Other items 5,195,014.23 1,770,801.57 3,411,896.56 J> Branches and offices 21,026,270.42 Member and nonmember banks 26,482,800.24 14,446,826.45 2,314,722.99 Miscellaneous 21,034.15 7,436.16 156,074.87 Collection items 50,989,000.00 46,886,000.00 7,352,000.00 <! Due to nGnmembers, clearing account 1,328,460.42 201,070.66 15,500.00 Other deposits, including foreign government credits 1,329,000.00 201,000.00 w o Total gross deposits. .289,488,000.00 103,251,000.00 61,384,000.00 > a Federal Reserve notes outstanding j 450,938,010.00 129,119,875.00 98,724,410.00 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Less: ' Federal Reserve notes on hand ' 20,525,690.00 8 569 260.00 1,813,495.00 L Mutilated Federal Reserve notes forwarded for redemption 1,592,205.00 „ 513 575.00 340,195.00 j. Total deductions 22,117,895.00 9 082 S35.00 2,153,090.00 L —— — Fcdera I Reserve notes in actual circulation 428,820,000.00 120,057,000.00 I 96.571,000. 00 >-M Federal Reserve bank notes 18,525,800.00 6 440 000.00 4,632,000.00 Less Federal Reserve bank notes on hand 882,800.00 224 000.00 463,454.00 Federa I Reserve bank notes in circulation, net liability 17,643,000.00 6,216,000.00 4,169,000.00 All other liabilities: Profit and loss 1,970,859.43 230,338.58 428,804.48 Discount earned—Bills discounted 4,646,657.10 2,197,795.40 1,175,998.09 Discount earned—Acceptances bought 718,907.25 226,163.86 106,410.39 Interest earned—United States securities ; 148,902.85 89,096.26 30,116.52 O Interest earned— Bill of lading drafts 5,703.16 2,692.32 '4 Interest earned—Rediscounts, other Federal Reserve banks 20,273.21 Unearned discount—Bills discounted '• 370,051.29 126,699.80 95,610.65 Unearned discount—Acceptances bought ' 144,535.16 23,280.93 59,491.37 Transfers bought and sold, net charges | 125,183.62 48,209.16 51,920.60 Penalties on deficient reserves : 35,966.10 52,106.85 21,697.86 71 Foreign exchange earnings | 595.10 Discount on United States bonds \ 89,248.50 47,430.48 Discount profit on bills sold } 741.22 5J Service charges, net ! 3,164.68 25,943.31 Collection charges ! 133.00 Sundry profits ! 17,396.27 11,404.14 4,713.26 ; Difference account i 1,370.38 891.98 Reserved for sundry expenses ' 19,612.60 14,092.08 ! Participation certificates, Liberty Loan bonds ' 9,450.00 Total ; 8,302,642.55 3,063,938.39 2,038,978.10 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

No. 21.—Statement showing condition of each Federal Reserve Bank on Dec. 31, 1918—Continued. o LIABILITIES—Continued. Chicago. St. Louis. Minneapolis. Less all other resources: d Interest accrued on United States securities $86,001.33 $33,499.35 j $16,659.09 > Expense current 1,146,691.57 718,210.98 \ 318,330.24 Disbursements—Transit department 3,176.23 Exchange paid 189.27 627.94 Other deferred charges 13,784.07 ! 8,551.80 ; 2,878.74 O Dividend account, including premium on surrendered stock.. 320,632. 68 | 404,837. 60 \ 86,574.41 H O Total 1,570,475.15 ! 1,165,727.07 424,448.48 Nl H All other liabilities, net. $6,732,000.00 $1,898,000.00 j $1,615,000.00 w Total liabilities.. 754,084,000.00 235,202,000.00 166, 1000.00 Kansas City. Dallas. San Francisco. Total. > Capital, paid in $3,659,450.00 $3,154,300.00 $4,631,300.00 $80,684,350.00 Capital, suspense account 5,250.00 82,350.00 w $3,659,000.00 $3,154,000.00 $4,637,000.00 $80,767,000.00 Surplus 1,134,23117 1,134,000.00 United States Government deposits—General account 5,450,293.54 2,493,217.68 400,539.85 50,967,818.64 w United States Government deposits—Special o account « 10,451.76 20,606,747.03 W Government deposits 5,450,000.00 2,493,000.00 411,000.00 71,574,000.00 a Due to member banks—reserve account 67,317,512.25 67,318,000.00 32,453,086.72 32,453,000. 00 73,235,715.37 73,230,000.00 1,635,432,548.24 1,6,15,433,000.00 Cashier's, expense, return item, and dividend 320,628.85 125,847.02 1,657,914.42 9,711,915.04 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Federal Reserve bank drafts ' 10,210.87 7,500.00 5,516. 66 1,735,850.32 Federal Reserve exchange drafts 3,860.98 1,560. 80 39,931.42 Federal Reserve transfer drafts ' 350,328.09 500.00 6,833.98 594,145. 40 Collection items—credits: Gold settlement fund—Suspense 5,803,451.18 5,297,780. 48 4,331,213.45 183,493,129,79 Federal Reserve Banks—Transfers sold, net. | 235, W0. 00 4,360,241.20 Other items | 5,982,943.13 4,194,489.90 2,094,832.43 67,374,658.25 2 Branches and offices ! 259,>TA02 4,949,731.71 26,899,181.54 " Member and nonmemberbanks.. 17,434,210.00 5, 129,177. 55 5.889,892.32 23.2,308,779.36 Miscellaneous : 1.07 30,669,996-02 Collection items 29,912,000,00 15,250,000. no 18,937,000.00 I 557,188,000.00 Foreign Government and bank credits 95,976,172.85 O I) ae to nonmembers, clearing account . ] 104.47 ,643,648.29 8,708,590.20 W ar Finance Corporation \ , 911.418.33 Other deposits, including foreign government O 8,000.00 2,044,000.00 \ : 105,590,000. 00 Total gross deposits. 102,680,000.00 I SO, 204,000.00 : 95,228,000.09 \ \2,109,791,000. 00 Federal Reserve notes outstanding 120,317,330.00 1,495,050.00 229,238,335.00 \ !2,S59,S43,920.00 I Less: Federal Reserve notes on hand 7,101,220.00 ,110,285.00 16,451,345.00 ................ 193,339,180.00 j Mutilated Federal Reserve notes forwarded for redemption 770,S20.00 140,285.00 542,365.00 ; j 7,552,990.00 Total deductions 7.872,040.00 1,256,570.00 16,993,710,00 200,892,170.00 ill Federal Reserve notes in actual circulation 112,445,00a 0) • ?, Co 3,952,000. 00 Federal Reserve bank notes 12,172,000.00 2 to 40<l. 00 7,125,000. 00 126,025,000.00 Less Federal Reserve bank notes on hand 723,519.00 69-J,5O0. 00 872,915.00 '........ 6,862,240.00 * Federal Reserve bank notes in circulation, net liability ,..* 11, l',S, 000. 00 ,540}000. 00 0,252,000.00 ! 119, 102,000.00 All other liabilities: Profit and loss 295,759.08 ; 518.168.13 731,987.59 ..j 16,065,105.83 Discount earned—Bills discounted.... | 2,643,113.16 ] ,084,309.75 1,920,582.79 !..... .......I 35,625,305.22 ';........ RYE W rji Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

No. 21.—Statement showing condition of each Federal Reserve Bank on Dec. 31,1918—Continued. C7? LIABILITIES—Continued. to Kansas City. Dallas. San Francisco. Total. > * All other liabilities—Continued. $157,982.45 $43,334.02 $634,519.95 $6,672,702.94 > 1,117.59 Interest earned—United States securities... 312,442.84 62,477.28 75,649.41 1,632,765.16 877. 55 2,438.91 2,103.38 13,815.32 Interest earned—Rediscounts other Federal o w 377,637.24 Unearned discount— Bills discounted 318,851.29 213,958.70 260,553.71 3,479,048.96 o Unearned discount—Acceptances bought... 47,374.61 12,257.99 112,246.18 949,277.27 Unearned interest—Municipal warrants 75.11 1-3 Unearned interest—Rediscounts Federal i 53,271.80 Transfers bought and sold, net charges 202,521.45 103,410.85 81,471.77 662,155.46 Profits realized on United States securities. 293.75 188,016.04 i w 288.'64 10,346.86 > 99,928.66 44,739.46 63,715.29 549,477.25 Penalties on deficient reserves—Suspense.. 2,449.07 . . . j. . ! ! . 1,224.80 W Exchange received 973.08 ' Pi Discount on United States bonds 694.68 145,079.36 \""r """"i Discount profits on bills sold 9,936.72 Si Service charges, net 23,493.43 ! ! 101,666.13 w Collection charges i ! i ; i | 133.00 o > Income, real estate 23,971.11 Sundry profits 11,576. 59 3,571.88 1 - - - I. - ^ 213,852.75 Difference account 6,540.09 10,127.96 24,597. 79 91,000.00 266,496.41 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Reserved for depreciation on United States [ bonds 89,591.66 Depreciation reserve account 205,5S0.00 Reserved for expenses War Finance Cattle I Loan Agency j 355.14 Reservedforinterestonrealestate mortgage; 3,750.00 Mortgage, real estate 750,000.00 Due to Liberty loan subscribers in default 36,297.52 Participation certificates Liberty loan bonds , 1,000.00 ; 44,860.00 Contracts to deliver Liberty loan bonds sold 13,411.00 Total. 4,1^9,874.04 |. J 3,981,648.23 68,200,173.81 i Less all other resources: I Interest accrued on United States securities. 62,257.78 30,715.34 J 37,051.80 621,142.58 ; Expense current 689,228.11 363,977.25 ' .! 490,578.28 8,181,336.15 j Disbursements—Transit department 238,999.62 Exchange paid * 924.12 ! Service charges, net 84. 50 169.' 254.29 ; Pay roll—Suspense account 86.55 86.55 ; Other deferred charges 7,941.50 547.96 1,050,702.22 ! Dividend account, including premium on surrendered stock 309,729.25 ; 2,177,694.61 Total 1,069,156.64 ! 395,411.60 525,102.07 12,270,799.30 All other liabilities, net. $(, 693,000.00 $3,456,000. 00 • $55, 929,000. 00 Total liabilities 2V. 303,000. 00 119,830,000.00 32LSI8,000. 00 5,285,735,000.00 a Credit. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Exhibit D—INVESTMENT OPERATIONS OF FEDERAL RESERVE BANKS. No. 22.—Bills discounted for member banks during each month in 1918, distributed by maturities, and totals for 1918. 1917, 1916, and 1915. PAPER MATURING WITHIN 15 BAYS. Federal Reserve Bank. January. February. March. April. May. June. July. Boston $12,890,384 $17,693,289 $15,523,870 $22,463,915 $25,097,283 $38,075,028 ' $114,197,595 New York 257,083,603 198,644,558 268,804,421 1,435,115,707 2,121,236,516 2,239,798,723 1,878,772.433 W Philadelphia.. 29,397,347 20,193,327 23,716,864 38,470,531 57,543,872 79,547,681 120,460,682 Cleveland 40,874,644 32,785,327 30,690,939 65,175,448 59,531,772 41,075,459 120,671,820 O Richmond 121,734,872 112,895,360 144,532,407 169,529,130 106,108,771 107,272,423 144,178,737 Atlanta 9,719,063 7,114,859 12,312,152 29.866.109 40,213,229 43,687,270 54,273,150 O Chicago 182,933,019 110,550,165 22,823,094 105,580,740 133,620,014 158,423,142 342,122,404 St. Louis 28,014,970 20,334,277 30,248,597 52,177,346 46,721, S36 74,186,256 83,789,029 Minneapolis... 2,240,574 1,372,430 413,879 11,170,601 17,007,772 24,933,147 30,949,511 Kansas City... 35,022,957 8,250,504 11,346,374 39,610,458 64,944,172 47,051,281 59,948,477 Dallas 5,228,109 8,291,076 13,029,562 29,774,697 29,017,470 35,376,905 34,656,687 San Francisco. 8,964,745 16,458,402 20,038,866 28.114.110 35,414,176 32,365,344 60,329,248 Total.... 734,104,287 554,583,574 593,479,025 2,027,048,792 2,736,456,883 2,921,792,659 3,044,349,773 Percent. 2.0 1.5 1.6 5.5 7.4 7.9 8.3 Federal Reserve Bank. August. September. October. November. December. ' Total. Per cent. Boston 93,918,843 209,372,694 259,481,880 265,031,138 338,294,539 1,412,040,458 3.8 New York 2,231,922,572 2,855,443,565 3,615,933,337 2,838,259,190 3,848,617,643 23,789,632,268 64.5 w Philadelphia. 127,793,462 153,973,399 194,912,938 336,956,229 501,274,022 1,684,240,354 4.0 o Cleveland 118,418,935 129,597,603 144,247,360 189,260,539 248,882,510 1,221,212,356 3.3 Richmond.... 156,488,559 202,970,563 206,422,565 263,872,356 254,249,504 1,990,255,247 5.4 Atlanta 73,586,243 107,429,693 151,687,565 150,371,625 149,059,357 829,320,315 2.2 Chicago.. 381,635,279 433,072,911 498,784,212 341,790,088 262,290,360 2,973,025,428 S.l Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

St. Louis 83,069,738 [ 101,930,356 133,557,031 | 140,447,290 124,676,298 919,153,024 2.5 Minneapolis... 17,347,038 I 48,786,054 47,258,525 30,694,245 8,705,428 240,879,204 .7 Kansas City... 49,194,750 j 63,773,189 97,048,844 86,692,376 69,278,543 632,161,925 1.7 Dallas 52,628,654 ! 64,303,997 71,127,312 57,850,904 62,020,630 463,304,003 1.2 San Francisco. 72,680,772 j 100,575,846 143,508,317 102,749,663 129,688,445 750,885,934 2.0 Total.... 3, 458,682,845 4,471,229,870 5,563,969,886 4,803,975,643 5,997,037,278 36,906,710,515 Per cent. 9.4 12.1 15.1 13.0 10.2 100. 0 • PAPER MATCRINC AFTER 15 DAYS BUT WITHIN 30 DAYS. Federal Resers'e Ban!:. January. February. March. April. May. June. July. Boston 2,923,578 1,929,497 1,817,825 1,679,924 3,486,681 2,322,329 6,222,091 New York 5,527,097 3,998,318 7,230,279 3,508,531 9,020,796 6,347,105 9,485,535 Philadelphia.. 1,870,768 COT.uJl J,190,150 1,169,662 847,190 839,890 3,741,774 Cleveland...... 2,211,205 ::, 911,090 2,418,578 3,375,833 2,123,959 •3,016,9 IS Richmond 1,,8.55,658 l,ly--'\001 1,946,053 2,797,187 3,920,244 3,265,143 2,209,974 Atlanta 1 714 620 1,067,249 954,161 1,001,917 1,683,056 1,337,881 1,460 313 Chicago........ 9,731,201 4,164,579 1,884,085 2,649,097 3,469,046 2,897,249 5,195,146 St* Louis 4,925,069 3,409,190 1,691,306 3,702,334 2,117,801 3,135,343 2,726,155 Minneapolis... 238 092 1,609,107 270,221 669,191 737,094 % 872,739 2 328 383 Kansas City... 483,544 2,035,550 2,549,903 1,713,413 2,460,945 1,105,346 1,666,414 Dallas... 247,996 369,242 1,581,394 655,946 751,174 845,857 .1,76 7,. 440 San Francisco. 2,453,323 680,300 907,395 518,980 1,565,145 779,863 4,827,698 Total.... 34,182,151 26,836,504 24,933,868 22, 434,760 33,435,005 27, S72,704 44,648,447 Per cont. 8.9 7.0 6.5 5.9 8.7 7. 3 11. 0 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

No. 22.—Bills discounted for member banks during each month in 1918, distributed by maturities, and totals for 1918, 1917, 1916, and 1915—Continued, C7T PAPER MATURING AFTER 15 DAYS BUT WITHIN 30 DAYS—Continued. Federal Reserve Bank. August. September. October. November. December. Total. Per cent > Boston 279,846 $2,222,108 $1,716,473 $3,416,598 $3,807,401 $33,824,951 S.8 cj New York 746,514 5,289,657 4,962,992 2,691,740 22,181,176 83,989,740 21.9 > Philadelphia.. 344,326 2,128,735 2,144,978 1,402,553 2,977,737 21,355,287 5.6 Cleveland '65,132 2,447,254 2,080,080 1,413,601 2,817,857 32,171,451 S.4 w Richmond.... 463,946 3,236,987 2,481,461 2,095,882 2,420,603 28,889,142 7.5 Atlanta 098,471 1,920,871 2,490,999 1,515,375 2,154,146 18,399,059 4.8 o w Chicago 700,382 3,532,171 5,835,652 2,131/652 3,588,575 47,778,835 12.4 H St. Louis 444,047 3,440,829 2,975,268 2,559,374 1,275,985 33,402,701 8.7 Minneapolis.., 800,199 2,278,568 1,955,617 2,632,715 109,173 27,591,099 7.2 Kansas City.. 710,998 1,839,143 2,670,630 2,275,650 1,028,229 20,539,771 5.3 Dallas 005,277 1,130,011 2,005,664 2,393,687 1,752,778 14,516,472 3.8 San Francisco. 877,615 3,300,929 1,281,490 1,356,283 1,903,686 21,452,707 5.6 Total... 32,236,753 32,767,263 32,601,304 25,885,110 46,017,346 383,901,215 O Percent 8.4 8.5 8.5 12.0 100.0 > PAPER MATURING AFTER 30 BUT WITHIN 60 DAYS. Federal Reserve Bank. January. February. March. April. May. June. July. Boston $3,986,859 $3,283,935 $4,233,977 $1,805,733 $2,872,752 $4,147,915 $12,869,905 New York 11.846.235 10,919,761 16,584,421 8,996,623 8,116,566 19,365,652 20, 750,256 O W Philadelphia.. 1,854,182 507,238 2,060,439 999,088 2,485,933 7,381,645 2,614,424 Cleveland 3,011,815 2,997,403 4,453,636 5,304,905 3,414,431 3,940,575 5,570,713 Richmond 2,380,508 2,069,395 2,355,067 7,074,651 7.509,506 6,716,463 6.417,812 Atlanta 1,684,663 1,731,686 2,073,760 1,655,560 2.219,828 2,768,904 3,079,607 Chicago 3,891,572 6,525,072 5,696,190 7,125,084 13,072,217 7,750,103 14,057,551 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

St. Louis 2,753,248 3,788,150 1 4,204,190 8,772,113 4.175,970 8,487,866 6.785,940 Minneapolis 1,163,793 2,682,453 1,040,431 3,121,582 5,031,868 5.763,930 6,732,978 Kansas City 1,220,015 3,406,337 7,554,587 3,921,187 6,528,105 3,691,840 5,733,702 Dallas... ¥ 550,671 683,802 2,575,439 1, 683,212 1,851,289 1,924,315 4.835,067 San Francisco 4,028,408 2,441,573 2,361,907 1,886,004 3. Ill, 031 1.642,264 10,338,230 Total 38,371.969 41,036,805 1 55,194,044 47,345,742 60,389,496 73,581.472 99,786,185 Per cent 5.1 5.4 7.3 6.3 8.0 9.8 13.2 Federal Reserve Bank August. September. October. November. December. Total. Percent. Boston 920,658 $4,027,547 $4,549,697 $6,486,240 $7,063,996 $60,249,214 8.0 New York 420,032 10,100,916 7,212,529 21,532,862 26,063,853 169,909,706 22.5 Philadelphia 529,153 1,716,974 2,674,716 1,636,376 2,502,955 28,963,123 3.9 Cleveland 844,740 3,934,301 3,859,103 2,391,846 4,870,909 47,594,377 6.3 Richmond 571,279 4,647,566 6,268,279 6', 213,996 4,819,726 60,044,248 S.O Atlanta 270,484 3,209,202 4,889,808 5,343,940 4,455,819 36,383,261 4.8 Chicago 681,602 9,390,724 14,617,971 5,931,631 7,800,867 103,540,584 13.7 St. Louis 122,821 6,646,895 8,619,201 7,000,806 3,863,184 63,220,384 8.4 Minneapolis 032,327 6,388,771 6,624,542 2,617,516 388,006 42,588,197 5.6 Kansas City 589,122 4,888,606 6,107,708 4,541,901 3,545,237 53, 728,347 7.1 Dallas 234,429 3,125,215 5,080,743 6,118,807 5,024,318 37,687,307 5.0 San Francisco 542,458 6,920,586 6,529,082 2,795,841 4,972,788 50,570,172 6.7 Total 48,759,105 64,997,303 77,033,379 72,611,762 75,371,658 754,478,920 Per cent , 6.5 10.2 9.6 10.0 100 0 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

No. 22.—Bills discounted for member banks during each month in 1918, distributedby maturities, and totals for 1918,1917, 1916, and 1915—Continued. PAPER MATURING AFTER 60 BUT WITHIN 90 DAYS. Federal Reserve Ban1.:. January. February. April. May. June. July. Boston $4,583,772 $37,868,013 $7,882,753 $3,977/320 $22,716,406 $8,123,067 $10,309,327 New York 23,813,860 54,238,125 28,722,971 12, 313,527 42,706,079 25,143,525 25,905,154 Philadelphia... 3,078,685 10,469,088 2,440, 739 1, 660,853 11,071,935 5,047,101 5,024,298 Cleveland 4,549,877 0,112,828 7,112,448 17,001,927 8,980,697 5,967,500 5,523,732 Richmond 2,889,232 4,613,055 2,437,356 5,320,471 9,679,203 9,524,639 9,824,494 Atlanta.... 1.062,441 648,698 1,615,624 1,154,876 1,999,957 2,964,580 3,411,553 Chicago... 3,101,886 6,165,325 4,381,517 4,045,741 12,181,939 10,711,762 15,588,319 St. Louis...... 2,471,965 2,802,380 3,680,650 3,239,648 6,433,353 6,755,253 11,552,473 Minneapolis... 886,885 1,092,186 330,321 1,328,863 3,063,797 4,253,107 15,518,349 Kansas City... 1,558,698 5,389,056 7,149,168 4,567,988 6,731,779 4,442,019 7,334,559 Dallas 316,245 501,240 1,849,818 2,922,304 2,455,315 2,849,922 7,014,261 San Francisco. 6,947,146 5,595,049 6,060,373 5,791,342 6,500,721 6,494,831 12,403,446 Total.... 55,260,692 135,495,043 73,063,738 63,324,860 134,521,181 92,277,306 129,409,965 Percent. 3.6 8.7 4.7 4.1 8.7 6.0 8.3 Federal Reserve Bank. August. September. October. November. December. Total. Percent. Boston $22,605,243 $13,718,765 $38,263,454 $67,776,871 $14,055,832 $251,880,823 16.2 New York.... 61,973,093 22,780,035 85,171,193 85,799,626 21,540,168 490,107,356 31.6 Philadelphia. 14,593,871 3,072,292 14,855,099 19,640,196 4,249,828 95,203,985 6.1 Cleveland 7,208,494 4,581,487 * 7,509,753 6,838,853 2,674,028 84,061,624 5.4 Richmond.... 7,183,387 4,319,262 G, 628,355 10,770,565 4,366,897 77,556,916 5.0 Atlanta....... 4,173,038 5,244,428 9,598,782 6,327,472 5,225,775 43,427,224 2.8 Chicago.. 12,941,692 8,473,111 22,19g, 305 13,818,473 9,026,004 122,634,074 7.9 St. Louis 4,075,205 5,792,065 9,651,888 5,508,782 3,812,238 65,775,900 4.2 Minneapolis.. 54,7d4,487 19,336,980 2,293,701 1,435,399 276,669 104,580,744 6.8 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Kansas City... 4.545,130 6.230.006 0, 925,090 6,414,016 4,560,808 Go,848,983 4.2 Dallas.. 7,908,969 5,083,990 6, 208,375 6, 543, 820 5,459,295 49,113,554 3.2 San Francisco. 11,767,478 11,807,573 9,123,176 8,044, 584 10,870,052 101,405,771 6.6 Total.... 213 740 087 110,439,994 218 427 177 238 919 257 86,117,054 1,551,590,954 Per cent. 13 8 7.1 14.1 15.4 5.5 100. 0 w AGRICULTl RAL AND LIVE STOCK PAPER MATURING AFTER 90 DAYS. H Federal Reserve Banks. January. Febr: March. April. May. June. July. o Boston $134,607 $52,300 $357,896 $567,062 $2,992 $8,591 $117,307 w New York. "870,284 018 746,929 63,394 29,900 128,410 Philadelphia.. 1,191 8,735 82,454 17,964 9,594 2,624,89S o Cleveland 63,105 317,909 378,923 49,519 6,865 45,744 Richmond........ | 81,411 34,229 115,702 334,614 997,365 743,810 553,227 Atlanta. 25,485 28,483 190,071 504,044 591,574 598,724 o Chicago... .....J 534,192 282,067 502,577 457,518 2,163,218 1,871,135 2,303,040 St. Louis ,- ) 31,956 16,964 678,667 101,446 105,292 2,059,858 182,290 Minnpauolis 407,064 291,220 1,593,515 3,754,561 3,875,343 4,020,911 J 1,909,070 2,497,094 3,303,806 4,956,141 15,052,513 7,151,247 8,448,686 Dallas. .. i 832,588 487,370 1,400,441 1,334,363 3,163,337 3,076,966 3,600,733 San Franci^o 625,285 657,362 1,032,949 2,342,583 2,276,805 2,579,751 Total 4,492,772 7,662,858 12,375,985 2^,210,782 21,701,688 25,203,781 Percent : 4.0 2.9 4.9 8.0 18.0 13.9 10.1 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

No. 22.™Bills discounted for member banks during each month in 1918, distributed by maturities, and totals for 1918, 1917.1916, and 1915—Continued. AGRICULTURAL AND LIVE STOCK PAPER MATURING AFTER 90 DAYS—Continued. O Federal Reserve Banks. August. September. October. November. December. Total. Per cent. Boston $16,133 $1,150 $30,603 $4,905 $995,882 $2,289,488 1.5 > New York 24,659 1,903 25,623 7,667 1,899,387 1.2 yA Philadelphia... 5,250 327,000 735,465 13,080 3,835,525 2.4 Cleveland 19,529 8,454 52,561 69,094 51,425 1,078,188 .7 r-4 > Richmond 112,130 21,275 59,621 19,466 26,968 3,099,818 2.0 Atlanta 217,560 164,982 69,195 90,746 82,521 2,600,228 1.6 Chicago 871,860 1,530,757 4,056,355 2,381,146 1,257,224 18,271,089 11.7 o St. Louis 247,838 39,090 96,131 8,500 17,213 3,585,245 2.3 Minneapolis... 1,863,123 127,028 232,728 • 623,696 429,651 18,152,556 11.6 H Kansas City... 1,708,043 1,895,428 4,666,184 6,711,612 2,941,712 61,241,536 39.2 O Dallas 1,804,892 1,038,180 1,000,986 1,992,381 3,334,193 23,066,430 14.8 San Francisco. 1,949,291 550,027 905,679 1,283,257 1,392,911 17,126,753 11.0 w Total.... 8,840,308 5,705,274 11,931,131 13,205,550 10,539,594 156,246,243 Per cent. 5.7 3.6 7.7 8.4 6.8 100.0 W TOTAL AMOUNT OF BILLS DISCOUNTED. W f> Federal Reserve Banks. January. February. March. April. May. June. July. August. September. fcd Boston $24,519,200 $60,827,034 $29,816,321 $30,493,954 $54,176,114 $52,676,930 $143,716,885 $123,740,723 $229,342,264 GO New York 299,141,079 267,801,380 321,342,092 1,460,681,317 2,181,143,351 2,290,684,905 1,935,041,788 2,306,086,870 2,893,616,076 Philadelphia.. 36,200,982 31,868,368 29,416,927 42,382,588 71,966,894 92,825,911 134,466,076 147,266,062 161,218,400 Cleveland 50,662,541 47,548,601 45,486,088 90,279,781 75,352,252 53,114,358 134,828,927 131,256,830 140,569,099 Richmond 128,941,681 120,808,043 151,386,585 185,056,053 128,215,089 127,522,478 163,184,244 168,819,301 215,195,653 o Atlanta 14,217,630 10,587,977 16,984,180 33,868,533 46,620,113 51,350,209 62,823,347 82,345,796 117,969,176 Chicago 200,191,870 127,687,208 35,287,463 119,858,180 164,506,434 181,653,391 379,326,460 405,830,815 455,999,674 o St. Louis 38,197,208 30,350,961 40,503,410 62,992,887 59,554,252 94,624,576 105,035,887 91,959,649 117,849,235 Minneapolis.. 5,463,060 7,253,240 2,346,072 17,883,752 29,595,092 41,698,266 59,550,132 86,807,174 76,917,401 Kansas City.. 40,194,284 21,578,547 31,903,838 54,769,187 95,717,514 63,441,733 83,131,838 58,748,043 78,626,372 Dallas 7,175,609 10,332,730 20,436,654 36,370,522 37,238,585 44,073,965 51,874,194 67,580,221 74,681,393 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

San Francisco. 23,324,475 25,800,609 30,023,903 7,943,385 ; 48,933,656 43,559,107 90,478,373 91,817,614 123,154,961 Total, 1918.. S68,229,619 762,444,698 754,933,533 2,172,580,139 2,993,019,346 137,225,829 3,343,458,151 3,762,259,098 4,685,139,704 Total, 1917.. 18,326,286 22,408,604 26,788,982 50,055,801 91,413,473 750,269,838 460,733,354 220,939,974 548,164,104 o o Total, 1916.. 11,115,000 7,664,600 9.387,300 11,521,500 11,195,500 11,660,000 20,183,000 17,351,800 14,308,800 00 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 o Percent, 1918.. 2.2 1.9 1.9 5.5 7.5 7.9 8.4 9.4 11.8 I Percent, 1917.. 0.2 0.3 0.3 0.6 1.0 8.4 5.1 2.5 6.1 «p Percent, 1916.. 5.4 3.7 4.5 5.5 5.4 5.6 9.7 8.3 6.9 Percent, 1915.. 6.7 7.8 8.3 6.5 7.5 8.3 8.2 7.6 8.9 Feder B a a l n R k e s. s erve October. November. December. Total, 1918. Total, 1917. Total, 1916. Total, 1915. Pe 1 r 9 c 1 e 8. n t, Pe 1 r 9 c 1 e 7. n t, Pe 1 r 9 c 1 e 6. n t, Per 1 9 c 1 e 5. n t, Boston 1 $304,042,107 $342,715,751 $364,217,650 $1,760,284,933 $350,919,310 $33,921,900 $2,086,700 4.5 3.9 16.3 1.3 New York 3,713,305,674 2,948,291,085 3,918,402,840 24,535,538,457 6,511,274,920 22,329,500 4,819,600 61.8 72.6 10.7 3.0 Philadelphia 215,323,196 359,648,434 511,014,436 1,833,598,274 223,416,008 22,328,400 5,137,100 4.6 2.5 10.7 3.2 Cleveland 157,748,857 199,973,933 259,296,729 1,386,117,996 211,176,106 6,792,400 4,526,000 3.5 2.3 3.3 2.8 Richmond 221,860,281 282,972,265 265,883,698 2.159.845.371 401,220,685 34,377,200 44,891,400 5.4 4.4 16.5 27.8 Atlanta 168,736,349 163,649,158 160,977,619 j 930,130,087 95,114,744 22,323,200 34,209,300 2.3 1.1 10.7 21.2 Chicago 545,492,495 366,052,990 283,963,030 3,265,850,010 521,872,103 23,178,100 9,238,700 8.2 6.0 11.2 5.7 St. Louis 154,899,519 155,524,753 133,644,917 , 1.085.137.254 181,117,652 8,842,700 6,317,600 2.7 2.0 4.3 3.9 Minneapolis 58,365,113 38,003,571 9,908,927 433,791,800 80,154,716 6,473,500 5,206,500 1.1 0.9 3.1 3.2 Kansas City 117,418,462 106,636,155 81,354,589 833,520,562 237,690,76S 6,817,700 10,875,500 2.1 2.8 3.3 6.8 Dallas 85,423,080 74,899,599 77,591,214 587,677,766 52,052,600 18,512,500 26,756,900 1.4 0.6 8.9 16.6 San Francisco 161,347,744 116,229,628 148,827,882 941,441,337 102,981,206 1,973,400 7,287,700 2.4 1.1 1.0 4.5 Total, 1918 5.903.962.877 5,154,597,322 6,215,083,531 39,752,933,847 ! i Total, 1917 ! 2,681,165,854 3,206,486,771 937,433,413 8,968,990, 818 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, 1918 14.9 13.0 15.6 100.0 Percent, 1917 29.9 35.7 9.9 100.0 Percent, 1916 5.7 8.6 30.7 100.0 Percent, 1915 9.3 11.3 9.6 100.0 1 i Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

No. 23. -Bills discounted by each Federal Reserve Bank, distributed by States; also number of banks accommodated through the discount of paper, during 1918. to Number Number of mem of mem States. b o a n S e n b t a k D a e c s r t h e e c in . m N a d c o u 1 u c 9 d m r o 1 a i b 8 m n t . g e e d r T d o i t o s a f c l o p a u a m n p t o e e r u d n . t States. b o a n S e n b t a D k a e c s t r e h e c in . m N a d o u c 1 u c 9 d m r o 1 a i b 8 n m t . g e e d r T d o i t o s a f c l o p a u a m n p t o e e r u d n . t > > . 31,1918. 31,1918. fcti Maine 65 30 $40,839,164 Michigan: o New Hampshire. 55 30 39,054,712 District No. 7 1S6 128 $612,0S0, 430 48 32 32,523,734 District No. 9 36 17 3,659,108 Massachusetts 178 131 1,499,921,400 Total 2°2 145 615 739 538 20 16 69,052,661 j Wisconsin: Connecticut: District No. 7 129 96 342,672,516 District No. 1 57 30 78,893,262 District No. 9 49 30 10,284,681 16 13 45,842,080 Total 178 126 Total 73 43 124,735,342 432 333 385,191,840 New York 555 407 24,181,383,095 > Illinois: ir1 New Jersey: District No. 7 373 168 1,741,500,084 w District No. 2 152 102 308,313,282 161 61 46,677,211 78 55 86,843,370 Total 534 229 1,788,177,295 w w Total 230 157 395,156,658 1 Indiana: 22 13 11,660,600 District No. 7 214 125 184,405,140 W 64 26 28,355,102 Pennsylvania: o District No 3 561 389 1,735,094,298 Total 278 151 212 760 942 311 100 555,474,714 j Missouri: Total 872 489 2,290,569,012 District No. 8 95 54 763,274,258 57 30 361,055,504 Ohio 416 184 790,608,920 1 Total 152 84 1,124,329, i62 ••• • •• • — Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Kentucky: Arkansas 88 61 61,234,665 District No. 4... 74 32 35,486,887 Minnesota 324 235 358,768,785 District No. 8... C9 40 80,572,946 North Dakota 173 118 17,518,176 South Dakota 137 91 31,766,675 Total 113 - 72 116,059,833 Montana 148 89 11,794,375 West Virginia: Wyoming 39 22 7,271,898 District No. 4.. 13 4 4,547,475 Nebraska 200 105 213,410,673 District No. 5.. 107 35 18,043,138 Colorado 128 76 68,956,667 Kansas 243 100 41,575,489 Total 120 39 22,590,613 Oklahoma: District of Columbia 9 3,5,255,243 District No. 10. 315 213 138,788,664 Maryland 103 05 272,526,166 DistrictNo.il. 36 31 9,557,232 Virginia 159 107 1,466,403,347 Total 351 244 148,345,896 North Carolina 88 74 187,059,493 South Carolina 93 83 180,557,983 New Mexico: District No. 10. 12 8 2,461,667 Tennessee: District No. 11. 37 31 11,521,998 District No. 6.. 91 51 130,925,181 District No. 8.. 21 20 98,660,820 Total 49 39 13,983,665 Total 112 71 229,586,001 Texas 630 467 540,158,745 Georgia | 116 107 278,623,585 Arizona: Florida 1 62 51 56,382,925 DistrictNo.il. 10 9 1,828,023 Alabama j 105 75 53,727,013 District No. 12. 11 6 2,207,705 Mississippi: Total 21 15 4,035,728 District No. 6.. 19 15 18,671,303 District No. 8.. 16 16 6,362,252 Utah | 40 31 131,448,094 Nevada 10 3 960,600 Total 35 31 25,033,555 California 281 168 545,594,322 Louisiana: Oregon j 97 54 37,105,409 District No. 6.. 33 28 391,800,080 Idaho , 1 95 76 57,383,894 DistrictNo.il. 14 10 24,611,769 Washington 109 77 166,741,313 Total 47 38 416,411,849 Grand total.. 8, C91 5,393 39,752,933,847 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

No. 24.—Member banks' collateral notes, also customers' paper secured by Government ivar obligations, discounted by each Federal Reserve Bank, by months, during the calendar year 1918, January. February. March. April. May. Federal Reserve Banks. M co n e l o l m a te t b e s e r . r a s l ' Cu p s a to p m er e . rs' M co n e l o m la t t b e e s e r . r a s l ' Cu p s a to p m er e . rs' M co n e l o m la t t e b e s e r . r a s l ' Cu p s a to p m er e . rs' M co n e l o l m a t t e b e s e r . r a s l ' Cu p s a to p m er e . rs' M co n e l o m la te t b e s e r . r a s l ' Cu p s a to p m er e . rs' Boston $5,978,158 $6,232,329 $6, 783,000 $40,049,332 $8,132,600 $8,896,879 $16,372, $3,746,698 $20,764,048 $23,920,032 New York 173,529,413 18,843,279 99,726,403 55,772,061 148,688,220 19,088,300 1,355,966, 11,237,688 1,900,216,460 38,610,339 Philadelphia... 3,548,155 4,416,425 3,311,200 17,371,856 8,745,100 2,694,060 28,176, 1,886,401 45,022,975 10,867,822 Cleveland 20,770,500 4,180,887 23,110,500 3,965,345 8,753,000 5,606,805 55,544, 3,878,229 48,543,431 6,546,557 Richmond 11,152,470 9,687,106 11,419,060 17,952,994 14,959,600 23,458,038 82,804, 15,472,498 96,162,708 4,524,938 Atlanta 0,215,300 3,131,500 100 5,980,400 30,000 20,192, 29,847 29,225,000 74,739 Chicago 89,119,492 390,984 84,769,114 2,154,554 2,149,588 2,018,963 77,302, 743,493 79,119,353 5,454,935 St. Louis 9,363,100 309,965 9,594,883 497,030 20,498,983, 1,688,293 37,593, 180,034 33,576,941 594,262 Minneapolis 1,490,788 31,780 307,000 124,668 70,000 5,050 9, 751, 8,141 15,210,500 426,024 Kansas City.... 5,343,300 401,392 3,388,900 105,948 8,901,903 10,000 36,251, 113,000 46,951,500 256,669 Dallas 2,841,000 5,481,500 306 11,795,800 135,509 29,286, 357,989 27,858,060 361,945 San Francisco.. 4,541,300 10,732,600 286,655 12,770,600 38,009 19,695, 76,078 28,920,130 296,168 Total 1918 1 333,892,976 44,614,222 261, 755,660 j 138, \ 1,849 251,445,794 63,669,906 1,768,938,819 37,730,096 2,431,571,106 91,934,430 June. July. August. September. October. Federal Reserve Banks. Members' col Customers' Members' col Customers' Members' col Customers' Members' col Customers' Members' col Customers' lateral notes. paper. lateral notes. paper. lateral notes. paper. lateral notes. paper. lateral notes. paper. Boston.. .i $32,528,996 $6,859,635 $98,378,346 $16,676,168 $88,800,196 $26,591,023 $202,286,223 $13,957,411 $246,238,850 $39,492,285 New York 2,065,401,011 19,477,160 1,559,668,587 32,148,364 1,997,927, 111 51,817,705 2,632, 741, 590 19,681,595 3,413,439,.359 80,049,179 Philadelphia 55,564,390 11,433,381 67,222,418 9,801,345 91,960,382 19,026,615 128,688,408 7,334,050 163,310,194 26,131,220 35,874,230 2,173,126 82,621,846 7,103,274 89,755,710 4,662,051 103,930,433 2,990,626 117,217,932 9,750,533 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Richmond I 101,978,577 3,324,045 140.. 085,437 2, 945,200 151,944,645 5,008, 415 196,504,254 2,673,036 204,682,578 5,162,993 Atlanta .! 29,029,252 21,447 36, 950,919 125, 698 55,559,162 284,729 S3,795,425 716,719 123,190,750 3,880,671 Chicago ! 87,900,794 973,114 198,153,410 4,895,398 256,902,885 6,056,940 324,088,650 2,535,951 417,479,346 9,188, 248 St. Louis ! 50,021,750 1,303,151 68,299,067 848,149 71,292,183 735,080 90,094,550 808,113 121,072,300 1,462,833 Minneapolis ! 18,074,920 241,195 26,691,137 1,416,412 45,844,500 2,867, 225 45,070,335 1,621,458 36,595,950 194,637 X Kansas City 31,977,778 262,473 37,389,208 220,703 39,912,923 305,683 56,652, 023 575,549 78,242,256 803,117 3 Dallas 34,618,750 108,613 33,053,750 612,202 50,661,040 1,188, 771 61,890,485 772,147 69,063,022 1,187, 797 San Francisco ' 25,591,362 392,640 43,296, 900 781,328 66,924,933 1,303,396 96,146,167 2,281,982 138,511,760 1,933, 761 Total 1918 ! 2,574,561,810 46,569,980 2,391,811,025 77,574,241 3,007,485,670 119,847,633 4,021,888,543 56,008,637 5,129,044,297 179,237,274 . I O November. December. Total. > Federal Reserve Banks. Grand total. Members' col Customers' Members' col Customers' Members' col Customers' lateral notes. paper. lateral notes paper. lateral notes paper. O % Boston ! $237,387,085 $74,583,318 $306, 478,500 $19,176,870 $1,270, 128,802 $280,181,980 $1, 550,3 10,782 in o New York | 2,637,805,627 100,617,285 3,694, 340,744 67,650,409 21,739, 451,335 514,993,364 22,254, 444,699 Philadelphia ; 286,310,717 37,865,117 447, 382,929 26,564,810 1,32S,2 43,568 175,393,102 1,504,6 36,670 Cleveland ! 171,371,385 9,390,876 231, 159,800 11,785,274 988, 653,567 72,033,583 1,060. 687,150 Richmond ! 258,879,599 9,937,554 250, 688,349 4,208,353 1,521,2 61,520 104,355,170 1,625; 616,690 Atlanta Ill, 562,050 4,378,530 115,2 27,550 1,430,283 620, 059,608 10,972,763 631, 032,371 Chicago 271,506,815 5,400,200 207, 519,850 3,506,522 2,096,0 11,297 43,319,302 2,139, S30,599 St. Louis 127,923,275 2,273,011 118, 885, "608 3,005,918 764, 216,431' 13,765,839 777, 982,270 Minneapolis 26,814,480 1,353,006 8,5 99,550 16,064 234, 520,760 8,305,660 242, 826,420 Xfl Kansas City 66,711,390 1,408,670 59, 042,364 430,432 470, 765,470 4,893,636 475, 659,106 Dallas ; 51,866,437 1,328,102 59, 519,264 844,049 440, 935,658 6,897,430 447, 833,088 % San Francisco ' 99,067,952 2,505,749 120, 958,691 2,546,510 667, 157,695 12,562,351 679, 720,046 W> Total 1918 4,350,206,812 251,041,418 5,619,803,199 141,165,494 32,142,405,711 1,247,674,180 33,390,079,891 w. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

No. 25.—Member hanks collateral notes discounted by each Federal Reserve Bank, by months, during the calendar year 1918. Federal Reserve Banks. January. February. March. April. May. June. July. Boston $6,969,158 $7,563,000 $8,867,600 $17,896,650 $21,114,273 $34,044,207 $106,522,346 New York 191,983,003 113,307,759 185,997,126 1,356, 791,810 1,980,216,460 2,065, 401,011 1,559,668,587 > Philadelphia.. 3,548,155 3,311,200 8,745,100 28,176,700 45,025,475 55,564,390 67,222,418 Cleveland 20,980,500 23,11*0,500 8,813,000 56,204,800 48,791,431 35,888,230 82,639,846 Richmond 11,162,470 11,464,060 14,979,600 84,438, 743 99,401,208 103,454,327 141,301,187 d Atlanta 6,966,550 3,375,000 7,151,900 20,243,300 29,883,500 31,289,252 37,385,919 Chicago i 183,385, 475 2 108,545,995 19,221,528 99,212,310 127,953,684 148,643,204 324,747,385 St. Louis 9,363,100 9,669,883 20,548,983 37,593,791 33,576,941 56,116,750 68,409,067 Minneapolis... 2,120,788 482,000 396,960 10,151,834 16,110, 781 22,403,920 30,209,905 Kansas City... 34,539,269 6,863,900 10,221,089 39,165,809 62,968,926 46,178.482 58,830,681 o Dallas 4,792,609 8,236,500 12,764,900 29,548,550 28,728,060 35,298,750 34,276,570 San Francisco. 6,131,300 10,782,600 12,770,600 19,695,300 28,922,630 25,918, 762 43,471,900 Total.... 481,942,377 306,662,397 310,478,386 1,799,119,597 2,502,693,369 2,660,201,285 2,554,685,811 Federal Reserve Banks. August. September. October. November. December. Total. 8 Boston $89, 718,196 $204,586,223 $256,833,350 $258, 784,085 $333,244,550 SI, 346,143,638 New York 1,997,927,111 2,632,741,590 3, 413,824,359 2,637,805,627 3,694,340,744 21,810,005,187 Philadelphia 91,960,382 128,695,908 163,310,194 286,310,717 447,382,929 1,329,253,568 Cleveland 91,410, 710 105,450, 433 117,567,932 171,506,385 231,229,800 993,593,567 Richmond 153,870,145 200,734,254 204,952,659 261,892,632 251,096,699 1,538,747,984 •72 Atlanta 55,904,162 84,194,425 124,004,750 112,142,108 116,963,950 629,504,816 Chicago 282,286,380 340,547,274 429,772,433 287,513,473 217,725,950 2,569,555,091 St. Louis 71,343,183 90,194,550 121,614,800 128,248,275 118,985,608 765,663,931 Minneapolis, r 61,898,403 48,320,335 46,817,950 29,367,180 8,636,550 276,916,606 W Kansas City 48,287,254 62,870,878 94,820,815 85,229,511 69,158,080 619,134,694 O Dallas 52,364,140 64,085,485 70,658,262 57,411,937 61,722,790 459,888,553 San Francisco . 66,924,933 96,146,167 138,636, 760 99,067,9c 2 120,961,691 669,380,595 d > Total...?..... 3, 063, 893,£99 4,058,567,522 5,182, 814,264 4,415,279,882 5,671,449,341 33,007,788,230 i Includes $88,167,000 of United States Securities taken under repurchase agreements. 2 Includes 186,007,000 of United States Securities taken under repurchase agreements. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

No. 26.— Trade acceptances discounted by Federal Reserve Banks during each month in 1918, and totals for 1918 and 1917. Federal Reserve Banks. January. February. March. April. May. June. July. Boston ... $1,681,761 $623,541 $1,441,002 $287,007 $901,692 $1,053,260 $551,835 New York . . . 4,934,254 11,123,967 4,986,983 3,811,992 4,249,429 5,605,182 4,136,385 Philadelphia 118,747 120,612 957,654 762,997 355,851 451,466 513,811 2 Cleveland . . . .. 1,847,172 2,200,071 1,619,742 1,729,270 2,670,568 2,053,702 2,301,768 Richmond . . 801,209 547,899 1,002,270 1,063,149 1,006,215 1,285,817 1,108,428 H Atlanta... "... 621,871 573,167 1,399,686 436,300 873,152 419,352 1,110,360 Chicago 281,487 128,167 553,436 314,103 264,744 1,142,274 868,740 St. Louis 1,108,623 1,754,783 2,367,480 1,639,269 1,205,288 1,109,843 1,354,693 o Minneapolis 65,349 33,394 11,662 28,039 213,950 246,619 Kansas City 790,762 1,397,180 1,075,446 670,674 913,868 1,082,091 867,638 > Dallas 194,762 157,266 36,585 o San Francisco 1,747,219 714,672 620,434 378,147 510,981 450,700 725,207 Total, 1918 13,998,454 19,217,453 16,230,557 11,120,947 13,165,738 14,810,953 13,822,0G9 m Total, 1917 574,464 856,078 762,820 678,022 1,767,702 2,521,374 1,077,607 o Federal Reserve Banks. August. September. October. November. December. Total, 1918. Total, 1917. w Boston 602,986 1,038,799 1,089,130 571,076 445,042 10,287,131 6,115,127 New York 5,630,306 9,836,692 8,041,286 5,340,319 2,980,117 70,676,912 6,863,800 Philadelphia 557,442 347,038 182,300 522,651 759,484 5,650,053 726,078 > Cleveland 1,832,837 3,142,641 1,616,281 2,321,011 1,559,228 24,894,291 4,400,590 F Richmond 772,059 1,112,713 1,526,210 1,867,914 1,295,226 13,389,109 3,160,449 Atlanta 175,920 910,206 2,235,224 1,750,090 1,191,868 11,697,196 4,562,494 m Chicago 1,073,997 893,103 2,332,938 558,361 621,661 9,033,011 429,845 < St. Louis 663,252 1,090,403 1,723,642 1,044,994 618,931 15,681,201 3,114,503 Minneapolis 100,857 40,221 4,629 50,576 4,075 799,371 363,673 Kansas City 525,597 447,202 963,425 808,205 858,850 10,400,938 2,646,322 W Dallas 146,213 74,821 586,970 451,306 408,835 2,056,758 177,953 > San Francisco 680,937 1,983,350 3,217,459 904,176 873,326 12,806,608 5,210,298 Total, 1918.... 12,762,403 20,917,189 23,519,494 16,190,679 11,616,643 187,372,579 Total, 1917.. 1,668,063 1,125,834 4,354,747 6,959,770 15,424,651 37,771,132 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

No. 27.—Total bills and war paper discounted during each month in 1918 by all Federal Reserve Banks and by the Nero York Federal Reserve Bank [In thousands of dollars.] 00 Per cent war paper Per cent > p T c a o o p t u e a n r l t w e d d i a s . r d N b W i y R B e s a w c e a F r o s n e p Y e u k d r a n o e v o p t r r e e f e a k d r l . d t i B b R F o s y c Y t e a e a o d s n o N l e u k e r w r n e r k v a w t t a o e e l r d d T is o c t o al u b n i t l e l d s c N th o B R B e e u i w e a l n F l s n t s Y e e e k d d r d o v o i e r s e b r f k a y , l | c N t o b B o R F e u i t w e e a l a n l s d n s l t e k e Y e b d r r d v i i o a t l s o e l r l b s k y w % > paper dis (discounted. counted. O H January... 378; 192,373 51.0 January 868,230 299,141 34.5 O February.. 400, 155,496 39.0 February... 762,445 267,801 35.1 March 315. 167,777 53.2 March 754,934 321,342 42.5 April 806: 367,204 75.6 April 172,580 460,681 67.2 W May 523, 998,827 79.2 May 993,019 181,143 72.9 June 621, 084,878 80.0 June 137,226 290,685 73.0 July 469, 591,817 64.5 July 343,458 935,042 57.9 O August 127, 049,745 65.5 August 762,259 306,087 61.3 H September. 077, 652,423 65.0 September. 685,140 893,616 §1.8 October 308, 493,489 65.8 October 903,963 713,306 62.9 November. 601, 738,423 59.5 November.. 154,597 948,291 57.2 W December.. 760, 761,991 65.3 December.. 215,083 918,403 63.0 S> Total 33,390,080 22,254,444 Total.. 39,752,934 24,535,538 61.7 <1 B W O & Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

F WAR PAPER AND TOTAL BILLS DISCOUNTED BY ALL FEDERAL RESERVE BANKS AND THE FEDERAL RESERVE\ n BANK OP NEIY YORK, DURING EACH MONTH IN 19/8. b Gave I: Tfarfixfter discounted by&ue> J:\%.<j5a,nfCofJYex>yorfC. 1 Curw>2: JodaimrJ^r &tscoun£ed &t/J?UJFJZ.J8axJ&. Cun>6>3: 3iUs 2)iscowi6ed by the. JTJt. J3cmfc cfJfewfforfC. 1 Cvurve4:3ills &isccvut£edbyJ?IL3rjl.$*nJcs. ^ II Ml Mm s * / t / / X > f * earn / / X t / V hem / \ soam / / ^twll r s/ Cd\** / yy ' N // *--**VL/ y / y N X - y\ y•**— N[/ 3axr\ r<^>. y t Ssf s S Ss VMQO r S* S , .—--T@-J ^^y /y // T^JH «~ *'' v^-^ **" wooo / //'' / /// // k 1b r-*» M // 1! r» - ^-—^ H. -. ( o II JAM. . FEB. MARCH APRIL MAY JUNE JULY AUG. SEPZ OCT. flOY. DEC. " Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

No. 28.—Number of banks, by districts, accommodated through the discount of paper during each month in 1918. O Federal Reserve Bank. January. February, March. April. May. June. July. August. Ses b pp e ttee r m . m - October. No b v e e r m . De b c e e r m . Total. Boston 100 109 140 138 179 161 182 215 211 229 196 New York 208 219 228 278 306 328 323 335 346 366 379 522 Philadelphia. 86 65 84 135 202 217 245 270 305 318 315 342 457 Cleveland 76 73 82 118 150 143 166 144 185 165 172 136 320 Richmond 127 141 144 181 254 255 268 261 229 235 258 238 373 Atlanta 77 76 90 112 163 218 214 207 194 216 250 251 327 Chicago 299 251 256 237 359 421 543 562 589 596 666 482 850 St. Louis 54 40 64 U2 125 134 139 170 190 204 179 176 278 Minneapolis.. 129 88 72 174 276 304 399 395 291 211 197 161 580 Kansas City.. 106 112 133 221 315 307 327 290 300 356 344 317 554 Dallas 61 162 234 304 327 424 436 355 457 422 388 548 San Francisco 109 114 160 160 206 232 386 269 257 259 222 415 Total... 1,432 1,353 1,568 2,100 2,793 3,462 3,671 3,464 3,610 3,667 3,288 No. 29.—Average rate {per cent) charged on all paper discounted by each Federal Reserve Bank, by months, during the calendar year 1918. Federal Reserve Bank. 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 . f A or v e y r e a a g r e . Boston 4.24 4.04 4.22 4.31 4.28 4.37 4.32 4.22 4.22 4.07 4.10 4.17 4.17 New York 3.82 3.90 3,84 4.05 4.09 4.14 4.11 4.12 4.06 4.09 4.09 4.05 4.06 Philadelphia 3.99 3.99 3.97 4.12 4.21 4.16 4.14 4.13 4.06 4.11 4.08 4.02 4.09 Cleveland 4.03 3,98 4,19 4.33 4.35 4.44 4,29 4.25 4.23 4.21 4.15 4.12 4.21 Richmond *. 4.02 4.03 3.97 4.33 4.50 4.67 4.63 4.45 4.45 4.41 4.31 4.29 4.38 Atlanta 4.13 4.17 4,12 4.20 4.30 4.34 4.30 4,24 4.23 4.21 4.17 4.21 4.06 3.94 3.96 4,44 4.26 4.43 4,40 4.27 4,23 4.22 4,24 4.24 4.25 4,24 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

St. Louis 4.11 4.13 4.01 4.24 4.37 4.49 4.39 4.25 4.27 4.29 4.21 4.16 Minneapolis.. 4.97 4.73 4.84 4.88 4.98 4.90 4.86 4.55 4.68 4.44 4.42 4.57 Kansas City.. 4.28 4.53 4.53 4.59 4.84 5.07 5.24 4.77 4.78 4.78 4.87 4.74 Dallas 4.52 4.25 4.34 4.39 4.71 4.68 4.73 4.56 4.40 4.44 4.56 4.58 San Francisco 4.47 4.35 4.32 4.60 4.66 4.65 4.59 4.50 4.57 4.51 4.53 4.57 Total... 4.02 4.02 4.08 4.23 4.35 4.42 4.37 4.25 4.24 4.21 4.20 4. IS NOTE.—Kates for the Boston and New York banks and for monthly totals are calculated on a 365-day basis. Hates for all other banks are calculated on a 360-day basis. No. 30.—Average maturity in days, of all paper discounted by each Federal Reserve Bank, by months, during the calendar year 1918. Federal Reserve Bank. | January. February. March. April. May. June. July. August. Se b p e t r e . m October. No b v e e r. m De b c e e r. r n- I I f A or v e y r e a a g r e . Boston 33.46 60.82 37.82 27.16 46.89 24.20 19.72 25.23 10.06 15.40 20.59 9.30 New York... 20.75 29.64 21.77 7.22 6.95 4.93 6.77 8.05 6.36 7.06 8.23 5.29 Philadelphia. 20.33 37.65 22.32 16.08 25.14 18.64 17.19 21.32 15.19 18.95 16.53 10.92 Cleveland — 20.88 25.39 26.61 20.61 21.59 22.11 16.16 18.03 16.50 17.62 15.19 13.34 Richmond... 7.36 8.58 6.18 9.12 17.07 15.36 13.15 11.27 8.70 10.45 10.61 9.22 Atlanta 24.31 24.39 25.06 18.83 19.89 20.65 20.42 19. 35 18.87 18.81 18.07 17.42 Chicago 14.79 19.94 30.21 18.63 22.95 20.39 19.02 17.69 17.10 19.01 18.42 18.00 St. Louis 20.77 24.75 24.75 19.83 23.60 24.22 23.42 18.26 18.86 19.42 16.52 16.03 Minneapolis.. 54.76 43.50 54.94 38.01 45.01 37.64 42.51 28.34 34.41 21.33 20.60 22.87 Kansas City.. 23.50 47.71 49.30 33.61 42.11 34.43 33.61 23. 81 24.46 25.28 28.24 23.85 Dallas 34.75 26.03 32.92 24.77 32.33 27.98 34.05 27.50 21.66 22.69 26.86 27.19 San Francisco. 44.96 34.44 33.41 31.69 31.70 30.90 29.87 27.26 23.05 19.74 20.69 21.18 Total.., 18.90 22.25 11.25 12.59 10.09 12.85 12. 70 10.38 11.17 12.37 S.54 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

No. 31.—Acceptances bought in open inarlcet during each, month in 1918; also totals for 1917, 1916, and 1915. Federal Reserve Bank. January. February. March. April. May. June. July. August. September. Boston $8,001,703 $11,723,878 $11,504,087 $8,939,064 $12,437,164 $8,761,789 $11,967,858 $19,139,739 $19,684,049 New York 80,010 607 91,970,835 75,850,840 57,952,754 61,379,510 39,567,562 62,862,729 91,862,018 115,774,488 | Philadelphia.. 5,167,838 4,153,683 5,570,666 6,822,070 8,434,297 7,120,876 5,748,048 3,080,170 2,741,791 Cleveland 2,883,179 5,623,223 4,713,142 3,564,198 845,949 5,854,860 11,152,929 15,287,322 15,932,632 I Richmond 9,077,247 5,541,592 7,076,000 9,004,825 5,581,710 4,773,249 5,469,628 6,006,274 3,220,347 Atlanta 3,309,766 2,599,135 4,071,183 3,658,724 1,273,136 2,763,939 1,925,064 1,597,563 4,713,695 Chicago 3,697,161 9,895,400 11,847,190 5,678,115 6,907,295 9,925,473 9,530,265 11,018,502 7,427,475 St. Louis 1,524,447 3,665,151 4,714,024 1,781,255 1,793,017 760,555 1,021,390 920,225 554,457 Minneapolis... 75,000 100,000 180,000 130,000 130,000 422,300 40,500 Kansas City.... 11,523 5,334 150,000 250,000 200,000 128,848 59,615 Dallas 3,532,502 2,184,406 3,550,000 3,280,000 2,095,000 1,380 000 370,000 714,214 1,580,000 San Francisco. 13,403,536 10,837,469 9,849,232 7,584,512 14,786,862 8,541,719 13,266,885 12,688,471 11,462,688 J Total, 1918. 130,619,5C9 148,275,106 138,996,364 108,515,517 115,913,940 89,580,022 123,573,644 162,796,413 183,132,122 Total, 1917. 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 | 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 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 I Per cent, 1918 7.2 8.1 7.6 6.0 6.4 4.9 6.8 8.9 10.1 Per cent, 1917 1.9 6.6 2.6 3.8 7.7 12.5 6.2 6.7 10.1 Per cent, 1916 2.5 3.2 5.9 4.8 5.7 11.0 9.5 7.4 9.6 Percent, 1915 4.1 12.9 6.2 4 4 7.3 9.2 7.2 7.0 ! Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Per cent. Federal Reserve Bank. November. December. Total, 1918. Total, 1917. Total, 1916. Total, 1915. 1918 1917 1916 1915 Boston $29,634,813 $22,983,966 $194,157,686 $91,528,205 $52,377,000 $14,105,000 10.7 8.5 13.6 21 7 New York 100,177,148 62,521,143 945,497,423 464,965,602 123,406,000 25,834,000 52.0 42.9 32.0 39.8 Philadelphia 6,893,200 1,335,136 77,686,322 85,913,798 53,122,000 7,565,000 4.3 7.9 13.8 11 7 Cleveland 15,474,755 18,225,626 122,800,420 ! 91,109,193 27,542,000 2,963,000 6.7 S.4 7.1 4 6 Richmond 3,630,276 4,296,346 70,765,491 58,116,061 11,313,000 250,000 3.9 5.4 2.9 4 4,148,098 6,701,928 45,477,368 26,392,564 12,544,000 72,000 2.5 2.4 3.2 .1 Chicago 15,074,220 9,917,628 122,787,257 66,714,061 27,061,000 5,782,000 7.2 6.2 7.0 8 9 St. Louis 1,448,156 5,536,163 26,096,120 29,732,271 20,681,000 1,801,000 1.4 2. 7 5.4 9 S Minneapolis 2,700,843 6,208,936 13,902,579 33,072,316 13,539,000 1,455,000 .8 3.1 3.5 2. 2 Kansas Cit}^ 3,413,592 3,468,366 14,690,587 26,825,413 8,191,000 1,788,000 .8 2.5 2.1 2. 8 Dallas 2,600,000 1,498,000 25,024,122 35,076,917 3,543,000 1.4 3.2 .9 San Francisco 10,502,411 13,040,200 150,653,420 68,266,108 32,776,000 3,230,000 S.3 6.8 8.5 5.0 Total, 1918 195,697,512 155,733,438 1,809,538,795 Total, 1917 186,218,728 178,069,009 11,077,712,509 Total, 1916 48,547,000 66,871,000 386,095,000 Total, 1915 7,919,000 12,790,000 J 64,845,000 Per cent, 1918 10.8 8.6 100 Per cent, 1917 17.3 16.5 100 1 Per cent, 1916 12.5 , 17. .3 100 ! Per cent, 1915 12.2 19.7 100 1 I 1 Includes $168,411,520 of acceptances purchased from Boston and New York by other Federal Reserve Banks. > U2 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

No. 32.—Acceptances bought in open market during each month in 1918, distributed by maturities. MATURITIES. Month. W d it a h y in s. 15 F 3 ro 0 m d a 1 y 6 s . t o Fr 6 o 0 m d a 3 y 1 s . t o Fr 9 o 0 m d a 6 y 1 s . t o O d v a e y r s 9 . 0 Total 1918. Total 1917. Total 1916. Total 1915 January $10,163,396 $10,420,623 $29,451,144 $77,090,959 $3,493,387 $130, 619,509 $20,617,180 $9,603,000 February... 5,714,258 12,642,259 34,252,035 91,901,419 3,765,135 148, 275,106 70,640,679 12,416,000 $2,666,000 March 1,476,821 11,402,728 29,733,043 .90^*72; 4b8' —57^, 314 138, 996,364 28,152,038 22,918,000 8,356,000 April....... 2,882,790 8,551,069 26,490,371 66,879,538 3,711,149 108, 515,517 41,312,691 18,499,000 4,018,000 May 7,027,740 10,687,239 25,981,277 63,734,124 2,483,560 115, 913,940 82,544,372 21,912,000 2,865,000 June 8,344,335 19,506,550 21,891,317 39,254,107 583,713 89, 580,022 135,229,697 42,325,000 4,701,000 July 6,546,558 22,259,172 38,729,263 54,430,558 1,608,093 123, 573,644 66,864,065 36,575,000 5,9S6,000 August 18,486,108 27,840,126 44,821,640 71,027,379 621,160 162, 796,413 72,122,802 28,447,000 4,656,000 September.. 26,897,127 32,358,684 42,745,203 80,116,518 1,014,590 183, 132,122 109,046,466 37,087,000 4,548,000 October 31,045,245 27,066,744 49,863,590 148,159,381 570,248 256, 705,208 86,894,182 40,895,000 6,310,000 November.. 18,837,937 58,448,954 66,977,207 51,057,284 376,130 195, 697,512 186,218,728 48,547,000 7,919,000 December.. 24,541,541 29,471,649 55,652,982 42,115,337 3,951,929 155, 733,438 178,069,009 66,871,000 • 12,790,000 Total 1918. 161,963,856 276,656,397 466,589,072 876,539,062 27,790,408 1,809,538,795 Total 1917. 32,048,198 128,893,138 267,034,882 613,295,250 36,441,035 1 1,077,712,509 Total 1916. 38,442 63,651 284,002 386,095,000 Total 1915. 2,980 9,057 52,808 04,845,000 I 1 Includes $168,411,520 of acceptances purchased from Boston and New York by other Federal Reserve Banks. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

No. 33.—Rediscounts and sales of discounted and purchased paper between Federal Reserve Banks during calendar year 1918. CHRONOLOGICAL TABLE. Rediscounted or sold by Federal Reserve Bank oi— Discounted or purchased "by Federal Reserve Bank of— New York. Richmond. Purchased Purchased Purchased ! Discounted bills. bills. hills. I bills. San Francisco I Jan. 10 $3,759,977 Pallas _ ! Jan. 14 $2,000,000 Do Jan. 16 300,000 Do. Jan. 24 1, 500,244 San Francisco !... do 908,145 Dallas Jan. 999,954 San Francisco \ Jan. 1,000,000 Do .' ! Feb. 995,561 Do , I Feb. 631,852 Dallas j Feb. 737,968 Philadelphia I Feb. $5,017,518 Chicago do 1,994,030 Minneapolis do 1,480, 501 Kansas City do..... 1,467,564 Cleveland I Feb. 21 2.494,410 Dallas | Feb. 26 2, 704,151 Cleveland i Mar. 1 2,098,148 Philadelphia I Mar. 5 2,529,502 Minneapolis do...., 2,555,350 Kansas City do, 5,037,200 Cleveland | Mar. 6 5,054,410 Chicago Mar. 14 5,214,143 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

No. 33.—Rediscounts and sales of discounted and purchased paper between Federal Reserve Banks during calendar year 1918—Continued. CHRONOLOGICAL TABLE—Continued. Rediscounted or sold by Federal Reserve Bank of— > Discounted or purchased by Federal Date. New York. Richmond. Chicago. St. Louis. M ap i o n l n is e . K C a i n t s y a . s Dallas. Reserve Bank of— > Purchased Purchased Discounted Purchased Discounted Discounted [Discounted Purchased Discounted W bills. bills. bills. bills. bills. bills. bills. bills. bills. 1 i O Philadelphia Mar. 26 $5,029,195 H Cleveland.. ...do 4,996,368 Chicago ...do 19,103,044 I 1 O Minneapolis ...do 7,534,729 i 1 i i Kansas City . ...do 7,511,147 1 | 1 ! Atlanta - Mar. 27 2,514,096 1 i ! ! * St. Louis ...do 2,526,276 1 ! Philadelphia Apr. 18 $3,999,257 < O Chicago ...do 3,007,049 1 ! Minneapolis ...do 1,992,547 > Do.. May 7 .1 $1,000,000 Philadelphia May 8 1 . 1,995,000 1 1 Boston May 16 $1,828,600 Philadelphia ...do 2,038,200 | ! i 1 Cleveland /..do 1,948,000 i '• i ! i < Chicago ...do 2,023,000 1 i I i K San Francisco .. do 2,028,700 ! 1 I i o W Boston May 17 1,100,000 i > Philadelphia .. ,. ... . ...do 990,450 1 Cleveland May 29 5,016,453 1,009, .500 ! Chicago ...do 931,000 ...do 978,500 i | Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Cleveland June 11 ' ' | ! ...I.......,....1 .....J 34,168.006 |. Chicago ...do ! ;....... \ i .....! 4.3*52.313 L Cleveland June 15 ! Boston June 27 635,000 1.862.0(54 Philadelphia. ...do 652,719 1.934.745 Cleveland ...do .770.350 3.924.137 Chicago ...do 822.777 3.439,777 Boston July 2J Cleveland July 5 ; ' ; Do July 9 ! ! | ! 7.500.002 l New York July 31 | | | Do Aug. 1 ; ^9. 984.139 | W Philadelphia. Aug. 2 \ ! : I 1.999.226 > Cleveland ...do 2.928.052 H New York Aug. 3; • | $5,000,000 | O Boston Aug. 9 " : 2.498.478 I 'A New York ...do ; i ' 7.498,881 Philadelphia. Aug. 13 J ! 1.352.500 3.703,200 Cleveland ...do ! ! 1.350,750 | 3,702,000 I Do Aug. 24 | 5,000,443 ; Philadelphia. Aug. 27 ! 4,999,075 ! Boston Aug. 30 | 2,000,000 > Philadelphia. ...do l 3,000,000 w > -4 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

No. 33.—Rediscounts and sales of discounted and purchased paper between Federal Reserve Banks during calendar year 1918—Continued. CHRONOLOGICAL TABLE—Continued. Rediscounted or sold by Federal Reserve Rank of- Discounted or purchased by Federal Date. Boston. New York. Philadelphia. Richmond. Atlanta. Dallas. Reserve Hank oi— Purchased Discounted Purchased Purchased Discounted Purchased Discounted Purchased Discounted Discounted bills. bills. bills. bills. bills. bills. bills. bi.ls. bills. bills. Philadelpliia . Oct. 1 $10,108,157 | Cleveland ...do... 20,012,723 i i Kansas City ...do .. I i $5,000,000 1 : i Boston . . . Oct. 3 4,973,583 i ! Chicago. ...do.... 8,815,110 I St. Louis ...do.... 2,025,237 j San Francisco Oct. 4 1,173,353 Philadelphia Oct. 8 1 I $250,000 $1,750,000 Cleveland ...do.... ! j 200,000 1,800,000 Kansas City ...do.... j i ! 1,000,000 i ' Cleveland Oct. 14 2, 500,000 1 Richmond ...do 331,176 ! Chicago ...do i 2 500' (.CO Philadelphia Oct. 21 i ! ! ! 1,000,000 Cleveland ...do... I 1 !' 1,717,500 Do Oct. 23 1 1 ' ! I 2,500,000 j 1 j i Philadelphia ...do.... 3,(20,000 Chicago .. do... i ! 2,500,000 Minneapolis ...do i i 2,500,000 Philadelphia Nov. 1 15,281,831 i | j 1 ! : ! | Cleveland ...do 5,083,423 Philadelphia Nov. 6 5,115,575 I I '. Cleveland ...do.... 5,111,724 1 1 i ] 2,500,000 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Chicago !... do. 2,500,000 Minneapolis [...do. 5,000,000 Cleveland ...do ; ! : ; ...j ! j i | 5,C005CCO New York Nov. 13 . !$10 022. 209 Do Nov. 14 20,118.746 X Chicago ...do.... 5,0C0,CC0 s Minneapolis ...do.... 5,COO,COO Cleveland Nov. 15 2,500,1X0 s Minneapolis ...do.... 2,500,000 San Francisco Nov. 18 1,801,066 Minneapolis Nov. 19 -| $0,564,409 $3,514,000 O Chicago ...do.... 10,069,500 j. •d New York ...do.... 10,056,775 > Cleveland ...do.... $25,223,947 M Minneapolis Nov. 20 O % San Francisco ...do.... 647,706 Chicago Nov. 21 5,353,000 O Do Nov. 26 5,000,000 Minneapolis ..do.... 5,000,000 San Francisco Dec. 2 10,609, &5 Minneapolis Dec. 3 5,000,000 Chicago Dec. 2 7,500,000 > Do Dec. 3 10,024,077 Do Dec. 5 $3,040, 880 m Minneapolis .do. 5,001,000 w St. Louis ...do.... 2,000,000 & Chicago . Dec. 6 50,100,201 6,032,000 w Do Dec. 10 5,000,000 Minneapolis Dec. 11 N3,573 10,016,500 w St. Louis Dec. 12 2,500,COO > Chicago ..do.... 5,000,000 w Do Dec. 13 5, COO, (!,() Minneapolis Dec. 17 Chicago ..do.... 5,000,01.0 | 5,000,000 to Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

No, 33.—Rediscounts and sales of discounted and purchased paper between Federal Reserve Banks during calendar year 1918—Continued. CO CHRONOLOGICAL TABLE—Continued. o Rcdiseountec or sold by Federal Reserve Bank of- > Discounted or purchased by Federal Reserve Bank of— Date. Boston. i New York. Atlanta. Dallas. ! ! > Purchased Discounted Purchased Purchased Discounted Discounted bills. ! bills. bills. bills. bills. bills. W W 1 o Minneapolis Dec. 20 i $5,000,000 w Kansas City Dec. 26 So,030,525 H Minneapolis Dec. 27 ! $ 10,015,600 ! 1 o Chicago ...do $5,000,000 Do Dec. 30 1 i 5,COO,000 H Do Dec. 31 1 1 6,000,000 ffi i 1 MONTHLY RECAPITULATION. W d Rediscounted or sold by Federal Reserve Bank of— > ! i 1918. j Boston. New York. Philadelphia. Cleveland. I Richmond. Atlanta. j ! ' i 1 1 Dis b co il u ls n . ted ! Pu b rc il h l a s. s ed Pur b c il h l a s. s ed Dis b c i o l u ls n . ted Pur b c i h ll a s. s ed i Dis b c i o ll u s n . ted Pu b rc il h ls a . s ed Disc b o il u ls n . ted ! Pur b c il h l a s. s ed ! i i i i ! ! I ! w January ! S3,759,977 $6, 708,343 February i 1 7,503, 942 1 ! i $9,959,613 w o March 1 15,176,402 56,527,146 i b April ! i . ! 8.998.853 i 5,016,453 j $9,806, 500 1 5,009,450 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

11,160,723 3,880,846 August 7,405,200 2, 703, 250 September October -'•7, 439,339 $10,887, 500 $450,000 November $25,223,947 40.711,299 2,448, 772 $20,078,984 3,514,000 6,564,409 35,422, 500 December 20,032,100 15,393,518 55,' 196,726 $20,046,235 10,024,077 33,532,000 Total 45,256,047 75,041,256 180,900,721 20,046,235 30,103,061 31,946,423 37,116,421 79,842,000 450,000 Rediscounted or sold by Federal Reserve Bank of— 1918. Chicago. St. Louis. Minneapolis. Kansas City. Dallas. San Francisco. Total. Purchased Discounted Discounted Discounted Discounted Purchased Discounted Purchased bills. bills. bills. bills. bills. bills. bills. bills. January $10, 468,320 February March 71,703,608 April 8,998,853 May $2, 995,000 $9,866,500 13,020,903 June $8,530,379 $5,003,652 24,694,754 3,880,846 July $12,500,009 10,000, 265 22,500, 274 August $9,984,139 $24, 990,877 9, 927, 278 42,329,355 12,687,389 September October .* 17,500,000 28,387, 500 47,889,339 November 25,000,000 89,160, 447 69,803,464 December 33,500,000 107,110,335 80, 614,321 Total 9, 9S4,139 12,500,009 24, 996, 877 8,530,379 100,931,195 2,995,000 324,049,165 336,590,598 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

No. 33.—Rediscounts and sales of discounted and purchased paper "between Federal Reserve Banks during calendar year 1918—-Continued. SUMMARY FOR THE YEAR. (In thousands of dollars.) Redi ^counted o r sold by ] federal Reserve Bank of— Discounted or pur Pur Dis chased by Federal Total. chased counted Reserve Bank of— Boston. Y N o e r w k . Ph p i h la i d a. e l 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. San c is F c r o a . n bills. bills. Boston 4,974 5,426 5,000 2,498 2,000 19,898 6,709 13,189 New York 20,119 20,079 9,984 12,499 5,000 67,681 50,182 17,499 Philadelphia 12,927 15,137 19,68S 6,620 4,999 6,994 66,365 '42,321 24,044 Cleveland 40,473 34,619 13,706 8,718 7,500 5,000 4,168 22,931 137,115 54,199 82,916 Richmond.. 331 331 331 ! ! Atlanta 2,514 2,514 2,514 Chicago .'. S3,298 13,065 12,218 5H, 955 4,362 28,500 9,nn. a«s 100,077 100 321 • 1 1 St. Louis 4,551 2,000 2,500 ! 9,051 4,551 4,500 I Minneapolis 27,371 7,535 15,005 13,551 5, 000 31,000 ! i 99.462 25,911 73,551 | Kansas City 5,037 12,542 1,468 1,000 5,000 25,047 19,047 6,000 | Dallas 8,242 8,242 8,242 ! i San Francisco 14,370 7,158 3,006 24,534 22,506 2,028 | 1 1 Total 120,297 180,901 50,149 69,063 80,293 9,984 12,5C0 24,996 8,530 103,925 660,638 7...T7 Purchased bills 75,041 ISO, 901 30,103 37,116 450 9,984 2,995 336,5G0 1 Discounted bills 45,256 20,046 31,947 79,843 12,500 24,996 8,530 loo, r 30 324,048 i -i Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

. m un j ' cl States bonds (par value) purchased by Federal Reserve Banks during each month in 1918. Federal Reserve B* • ' '•( •• January. February. March. April. May. June. July. August. Boston, $1,987,088 $2,030,000 $155,000 $509,525 $2,623,950 $300 New York , 18,000 14,060,000 9,991,000 $50,000 Philadelphia 5, 747, 450 3, 445,000 1,045,000 $245,000 400,000 150 Cleveland 60,000 1,250 12,100 5,000 200 25,200 Richmond... 2,350 50 500 Atlanta 4,305,000 5,556,800 6,943,100 2,044,900 206,250 91,000 167,000 Chicago 83,050 St. Louis ; Minneapolis 2,149,000 3,693,300 1,586,600 944,000 29,050 15,000 92,000 Kansas Ci ty 13,100 2,450 12,650 Dallas 50,000 12,450 San Francisco 26,000 10,600 5,650 1,000,000 150 1,000,000 Total, 1918 14,337,638 14,746,700 9,823,400 3,239,550 15,831,825 13,047 750 1,141,700 284,650 Total, 1917 2,431,390 144,950 8,640,510 2,870,040 52,000 1,241,900 18,366,650 3,S25, 460 Per cent, 1918 19.38 19.93 13.28 4.38 ' 21.40 17. 63 1.54 .38 Per cent, 1917 2.98 .18 10.60 3.52 .06 1.52 22.53 4.69 Classes of securities purchased each month: 3 per cent bonds 405,000 50,000 3i per cent bonds 1, 094,100 1, 679,300 1,327,650 745,100 25, 850 2,628, 400 27 050 13,243,538 13,067,400 8,495,750 2, 494, 450 2,510, 600 3,297,350 1,050,000 4£ per cent bonds 13,295,375 6, 717,000 41, 700 257, 600 Total, 1918 14,337,638 14,746,700 9,823,400 3, 239,550 15,831,825 13, 047, 750 1,141, 700 284,650 Total, 1917 „ 2,431,390 144,950 8,640,510 2, 870,040 52,000 1,241,900 18,366,650 3,825,460 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

No. 84.—Amounts of United Stoics bonds «par value) purchased by Federal Reserve Banks during each month in 191S—Continued. Per cent, Federal Reserve Bank. September. October. November. December. T 1 o 9 t 1 a 8 l . , T 1 o 9 t 1 a 7 l . , 1918. 1917. ! Boston $50 §1,222,350 $800 $8,529,063 i SI, 418,116 11.53 1.74 New York 24,119,000 7,646,600 32.59 9.38 Philadelphia... 1,500 $78,050 10,900 10,973,050 12,274,250 14.83 15.05 Cleveland 50 100 103,900 4,159,700 .14 5.10 Richmond 1,000 3,900 1,137,500 .01 1.39 Atlanta 96,000 31,750 15,400 25,050 ! 19, JS2.250 7,924,900 26.33 9.72 Chicago , 10,850 100 94.000 40,985,760 .13 50. 27 St. Louis , 650,050 .80 Minneapolis 11,450 ! 8,520,400 615,650 11.51 .75 Kansas Cit y.... 28,200 1.187,240 .04 1.46 Dallas , 29,500 ! 91.950 1,394.950 .12 1.71 San Francisco.. 8,200 ! 2.050, 600 2.142.600 Total, 1918. 1 OH, 950 1,305,750 93,550 36. *5Q \; •l.o 100.00 100. ^0 Total, 1917. 20. 830,650 190. 400 i 1,546,946 21.3W.-S20 : -si ." Percent, 1918. .14 .13 .05 I 100.00 ! Percent, 1917. 1.90 2v. 24 '• Classes of securities purchased each month 2 per cent bonds 1:;, 997. 200 \ 3 per cent bonds 4-25,000 1><.-M0 > 3$ per cent bonds 35,000 15,500 103! 7,578.050 *5, 5*2.610 | 4 per cent bonds 61,000 10,900 44,230,988 i 21,488,0*0 I 4\ per cent bonds 10,950 1,290,250 93.450 ! 25,950 21, 732. 275 Total, 1918. 105,950 1,305,750 j 93,550 j 36,850 73,996.313 ; Total, 1917. 20,830,650 190,400 i 1.546,946 ! 21,396,420 51.537,316 I i Includes Liberty loan bonds sold to individual subscribers on partial-payment plan. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

No. 35.—Amounts cf United, 'states certificates of indebtedness purchased by Federal Reserve Banks during each month in 1918. January. February. March. April. May. June. July. Boston $165,000 $2,250,000 1330,000 $125,000 New York.... 1406,870,000 448, 249,000 939,130,000 $232,088,000 178,586,000 $389,799,000 $19,366,000 W Philadelphia.. 4,039,000 2,585,000 9, 971,000 7,712,500 107,000 3,943,000 55,000 Cleveland 79,000,000 57, 059,000 23,833,500 9,214,500 1,024,000 1,032,000 490,000 W Richmond 573,000 25,000 10,000 225,000 Atlanta 700,000 3,080,000 5, 521,500 2,205,100 108,000 55,000 17,500 Chicago 13,509,000 619,000 85,537,300 31,703,200 719,500 40,000 O St. Louis Minneapolis... 135,000 2,987,000 j 22,854,500 32,970,000 2,433,500 20,043,000 1,364,000 Kansas City... 4,551,000 86,000 | 313,000 1,334,500 69,000 50,000 122,500 Dallas -1,400,000 741,000 1,073,000 81,000 ©• San Francisco. 52,000 1,000,000 3,019,500 1,162,50Q 838,500 157,000 Total.... 511,542,000 518,192,000 1,089,231, 321,326,300 184,425,500 415,800,500 21,797,000 o August. September. October. November. December. Total. hrj H Boston... $3,750,000 $1,000,000 $69,000,000 $76,020,000 w New York $29,285,000 $71,858,000 561,199,500 200,390,500 1,527,083,500 5,003,904,500 Philadelphia.. 20,000 3,272,000 18,451,000 2,203,500 3,840,000 56,199,000 Cleveland 20,000 3,565,000 8,497, 500 10,660,000 61,847,500 257,443,000 Richmond 1,000 1,886,000 499,000 29,500,000 32,719,000 ui Atlanta 10,000 1,000,000 2,338,000 62,000 5,059,000 20,756,100 Chicago 3,000,000 0,167,000 2,000,000 3,000,000 146,295,060 St. Louis 2,000,000 2,071,000 1,497,000 1,000,000 6,568,000 Minneapolis 82,500 170,000 2,844,500 175,000 1,505, 500 87,570,500 Kansas City... 52,500 235,000 2,199,500 75,000 2,015,000 11,103,000 Dallas 750,500 270,000 1,741,000 499,000 16,015,000 22,570,500 San Francisco.. 212,000 19,899,500 248,000 28,014,500 54,603,500 m Total... 30,221,500 85,582,000 "631,044,500 219,309,000 1,747,880,000 5,776,352,160 i Includes $520,000 of one-year Treasury notes. 00 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

No, 36.-—Amounts of one-year ? per cent certificates of indebtedness purchased by Federal Reserve Banks during each month in 1918 and deposited with the United States Treasurer as security for Federal Reserve bank notes. 00 1918. Boston. New York/ ^jjf61" j Cleveland. Richmond.; Atlanta. Chicago. | St. Louis. Mi o n l n is e . a p K C a i n ty sa . s Dallas. Sa c n i s F co ra . n Total. ! 1 ! i j | August $6,000,000 $6,000,000 <"1 September 9,000,000 S3.000.000 12.000.000 $1,000,000 i $3,000,000 ; $2,000,000 20,000,000 October $3,750,000 9,955,000 i 356.000 2.458,000 Si, 886,000 2,298,000; 6,167,000; 2,071,000 $1,350,000 82,000,000 SI, 170,000 ! $1.7.10.000 35,217,000 November 1,000,000 1,000,000 2,000,000 3,000,000 499,000 2,000,000 i 1,497,000 1,000,000 499,000 12,495,000 W w 2,000,000 9,000,000 3,499,000 2,000.000 1,500,000 1,999,000 3,000,000 1,000,000 2,000, COO 1,49*. 000 1,500,000 1,998,000 30,995,000 o hj w Total 6,750,000 ! 34,955,000 j 8,855,000 9.458,000 3.SS5,000 5,297,000 14,167,000 6,568,000 4,350,000 3.499.000 3,17o,000 3,748,000 104,707,000 HI O No. 37.— United States bonds and one-ytxr Treasury notes redeemed by the United States Treasury during ihe calendar year 191S. W 3 per cent I 3 per cent Federal Reserve bank. l 3 o a p n e o r i c l e 9 n 1 t i . Tr 1 e - a y is e su a ur r ry y | j T Lomi , ' Federal Reserve tank. l 3 ea p n e o r f c 1 e 9 n 1 t $ . T 1 r - e y a e s a u r r y Total. w o notes. / notes. w w Boston $1. 52?. 000 §1,528,000 St. Louis *1.0«V: 81,444.000 82,524,000 New York... 4.4*2.000 4,592,000 Minneapolis 1 .":>?. 2 S10.0C0 2,009, 180 Philadelphia. 400.0 1.723.000 2.123,000 • Kansas City vOS.000 963,000 C B /l ' Cleveland — .£5f.O 2.01V, OK* 4,677,660 . Dallas 705,000 Richmond... 1.070.000 1,070,000 San Francisco 500.000 Atlanta 824.000 824,000 3> Chicago >i.u» 1.953,000 4,514,000 Total. 0.029.840 O Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

NQVSS^—Investment operations of Federal Reserve Banks during 1918, by classes of investments. (Figures are exclusive of rediscounts and sales of discounted and purchased paper between Federal Reserve Banks). Commercial paper discounted. Acceptances bought in open market.; United States securities. Bonds. Secured by Government Trade ac wa t r i o o n b s li . g a ceptances. All other. Total. Bankers. Trade. Total. 2 per 3 per 3i per 4 per 41 per cent. cent. cent. cent. cent. Boston $1,550,310,782 $10,287,131 $199,687,020 $1,760,284, $192, 068,446 $2,089,240 $194, $2,643,900 $4,152,188 $1,732,975 New York [22,254,444,699 70,676,912 |2,210,416,846 24,535,538, 925, 729,971 19,767,452 945, $50,000 4,601,000 19,468,000 Philadelphia. 'l, 504,636,670 5,650,053 323,311,551 1,833,598, 77, 254,080 432.242 77, 400,000 730,000 9,763,350 79,700 Cleveland 1,060,687,150 24,894,291 300,536,555 1,388,117 117, 517.671 5,282,749 122, 5,000 61,250 37,650 Richmond 1,625,616,690 13,389,109 520,839,572 2,159,845, 70, 765,491 70, 50 2,350 1,500 Atlanta 631,032,371 11,697,196 287,400,520 930,130, 45, 477,368 45, 3,141,600 16,098,400 242,250 Chicago 2,139,330, 599 9,033,011 1,117,486,400 3,265,850, 122, 761,240 26,017 122 83,050 10,950 St. Louis 777,982,270 15,681,201 291,473,783 1,085,137 26, 096,120 26 ; Minneapolis.. 242, 826,420 799, 371 190,166,009 433,791, 13, 885,260 17,319 13, 1,035,150 7,376,150 109,100 Kansas City.. 475,659,106 10,400,938 347,460,518 833,520 ; 14, 656,546 34,041 14, 20,100 8,100 Dallas 447,833,088 2,056, 758 137,787,920 587,677, 25, 024,122 25, 50,000 41,950 San Francisco 679,720,046 12,806,608 248, 914, 683 941,441 117, 266,510 |33,386,910 150, 7,250 2,035,150 8,200 Total... 33,390,079,891 187,372,575 16,175,481,377 39,752,933,847 1,748,502,825 1,809,538,795 455,000 7,578,050 44,230,988 21,732,275 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

No, aS.--Investment operations of Federal Reserve Banks during 1918, by classes of investments—Continued. CO ! United Stat es securities. Municipal warrants. Total, 1918. i Total, 1917. > Certificates of Total. City. State. All other, j Total. indebtedness. Boston.. $76 620 000 $85,149,063 ; $2,039,591,682 $443,992,608 New York.... 5,003.384,500 5,028,023.500 j $50,521 $50,521 30,509,109,901 7,018,633,903 Philadelphia.. 56.199,000 $10,000 | 10.000 1,978,466,646 323,225,480 Cleveland 257.443,000 257,546.900 S 1,766,465,316 312,020,076 o w Richmond 32,719,000 32,722.900 !. 2,263,333,762 461,045,246 Atlanta 20,756,100 40.238.350 ! 114,644 152.229 ' 266.873 1, 016,112, 678 130,197,843 H Chicago 116,295,060 2 146,389,060 \. $300,000 700.000 ! 1.000.000 3.536,026,327 632,130,411 O St. Louis 6.568,000 6.568.000 >. 1.117,801,374 217,518,606 H Minneapolis.... 87,570,500 96,090.900 543,785,279 119,026,868 W Kansas City... 11,103,000 11.131,200 859,342,349 271,137,854 Dallas 22.570.500 22.662. 150 \ 382,208 SV2. 20$ 635,746,546 94,216,141 San Francisco. 54,603.500 56,654.100 : 1.148.748.857 174,175,809 W w Total.... 5. 775.832.160 5,850,348.473 547,373 300,000 862.229 ' 1. 709. 602 47,414.530,717 10,197,320,845 i Figures for 1917 includes $213,607,152 of paper discounted f->r or purchased from other Federal Reserve Banks, but exclude purchases of United States certificates of indebtedness. 2 Exclusive of $174,174,000 of United States securities taken under repurchase agreements during January and February and included among discounted bills. w o I Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

No. 89.—Investment operations of Federal Reserve Banks during 1918 and 1917, by months and classes of investments. (Figures are exclusive of rediscounts and sales of discounted and purchased paper between Federal Keserve Bunks.) Bills discounted for member banks. Acceptances bought in open market. United Sta Les bonds. Month and year. Secured by G w o ar v e o r b n l m ig c a nt c T ep ra ta d n e c a e c s . All other. Total. Bankers'. Trade. Total. 2 per cent. 3 per cent. 3.1 x>crcent. 4 per cent. tions. $378,507,198 $13,998,454 $475,723,967 $868,229,619 $128,117,262 $2,502,247 $130,619,509 £1,094,100 $13,243,538 400,036,509 19,217,453 343,190,736 762,444,698 145,681,853 2,593,253 148,275,106 1,679,300 13,067,400 315,115, 700 16,230,557 423,587,276 754,933,533 134,447,248 4,549,116 138,996,364 1,327,650 8,495,750 1,806,668,915 11,120,947 354,790,277 2,172,580,139 104,522,935 3,992,582 108,515,517 745,100 2, 494,450 2,523,505,536 13,165,738 456,348,072 2,993,019,346 108,749,327 7,164,613 115,913,9*40 25,850 2,510,600 2,621,131,790 14,810,953 501,283,086 3,137,225,829 84,955,464 4,624,558 89,580,022 $405,000 2,628,400 3,297,350 July 2, 469,385,266 13, 822,069 860,250,816 3,343, 458,151 117,991,650 5,581,994 123,573,644 50,000 1,050,000 August 3,127,333,303 12, 762,403 622,163,392 3,762,259,098 155,016,446 7, 779,967 162,796, 413 27,050 4,077,897,180 20,917,189 586,325,335 4,685,139,704 178,887,336 4,244,786 183,132,122 35,000 61,000 5,308,281,571 23,519,494 572,161,812 5,903,962,877 249,326,100 7,379,108 256,705,208 15,500 4.601, 248,230 16,190,679 537,158,413 5,154,597,322 190,939,921 4,757,591 195,697,512 100 December 5, 760,968, 693 11,616,643 442,498,195 6,215,083,531 149,867,283 5,866,155 155,733, 438 10, 900 Total, 1918 33,390,079,891 187,372,579 i 6,175,481,377 39,752,933,847 1,748,502,825 61,035,970 1,809,538,795 455,000 7,578,050 44,230,988 Total, 1917 a 5,884, 160,624 37,771,132 3,092,254,698 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 5,212,300 202,658,200 207,870,500 369,762,300 16,332 700 386,095,000 48,128,100 3,918,880 4,403,200 Total, 1915 .. . 1,958,800 159,394, 200 161,353, 000 64,814,000 31,000 64,845,000 11,776,350 3,167,120 770,000 1 Includes $19,940,200 of bankers' acceptances discounted. 2 Includes member banks' collateral notes only, and is exclusive of customers' paper similarly secured, the amount of which, however, was small. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

No. 39.—Investment operations of Federal Reserve B. anis during 1918 and 1917, f/r months and classes of investments—- Continued. United United States Total Municipal warrants. T 3tal investment operations. Month and year. b S o t n at d e s s , certificates of United States 41 per cent. indebtedness. securities. City. State. All other. Total. Total, 1918. Total, 1917. Total, 1916. Total, 1915. January $511,542,000 $525,879,638 $236,963 $300,000 $719,000 $1,255,963 .$1,525,984,729 $49,105,356 537,150,980 S23 450 300 February 518,192,000 532,938,700 135,049 1,500 136,549 1, 443, 795, 0.".3 99,502,895 40,028,950 20 345 M)0 March 1,089,231,860 1,099,055,260 32,278 . 62,625 94,903 1,993,080,060 06,495,153 50,981,150 26 834 900 April 321,326,300 324,565,850 32,270 26,000 58, 270 2,605, 719, 776 95, 738,81S 50,801,300 17 838 9)0 May $13,295,375 184,425,500 200,257,325 10,500 16,500 3,309,207,111 174,128, 766 48,199,800 20 242 500 June. 6,717,000 415,800,500 428,848,250 5,073 4,500 9,573 3,655,663,674 887,502,360 00, 785,340 23 179 300 July 41, 700 21,797,000 22,938,700 51,121 10,000 67,121 3,490,037,616 547,434,069 04,354,450 27 048 000 August 257,600 30,221, 500 30,506,150 45, (\So 4,591 50,276 3,955,611,937 297,023,452 47, 902,200 29 375 0(X) September 10,950 85,582,000 85,688,950 3,631 5,133 8, 764 4,953,969,540 678,062,976 58,679,500 23.556,300 October 1,290,250 631,044,500 632,350,250 300 300 6, 793,018,635 2,770,806,092 63, 282, ItiO 23 901,000 November 93,450 219,309,000 219,402,550 5,303 6,080 11,383 5,569,708,767 3,394,416,518 79,644,600 38,178 700 December 25,950 1,747,880,000 1,747,916,850 8,118,733,819 1,137,104,390 139,531,250 33,760,100 Total, 1918 21,732,275 1 5,776,352,160 5,850,348,473 547,373 300,000 862,229 1,709,602 47,414,530,717 i | Total, 1917 2 7,063,000 88,600,316 15,769, 759 263,059 788, 748 10,821,566 Total, 1916 2 300,000 56, 750,180 85,662,400 4,087,100 936,500 90, 686, 000 741,401,680 Total, 1915 ! 15,713,470 65,859,300 1 | ! 307,770,800 1 Includes $520,000 of 1-year Treasury notes. 2 1-year Treasury notes. 3 Includes $213,607,152 of bills discounted for or purchased from other Federal Pweserve Bunks but excludes purchases of certificates of indebtedness. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

No. 40.— Total investment operations of Federal Reserve Banks during each month of WIS. ("Figures are exclusive of rediscounts and sales of discounted and purchased paper between Federal Reserve Banks.) Federal Reserve Ranks. January. February. March. April. May. June. July. Boston $34, 672.991 $76, 830,912 $41,805,408 $39,433,018 $67, 247, 803 $64,062, 609 $155. 684. 7-: 3 New York 786, 021, 686 808. 039,215 1,336,322,932 1,750,722,071 ,435,168,861 !, 730,042, 467 2,017. 371,038 Philadelphia.. 51, 165,270 42, 052,051 46,003,593 57,162,158 80,508,191 104,289, 787 140, 269,124 Cleveland 133, 205, 720 110. 832,074 74,032, 730 103,058, 479 77,234,301 60,006,218 146; 472,056 Richmond 138, 591, 928 126; 376,985 158,462,635 194,060,878 133,806,799 132,295,727 168; 879,372 Atlanta 22, 549,478 22: ,425,412 33,596,588 41, 835,527 48,223,999 54,178,721 64, 873,511 Chicago 218, 398,031 138, ,201,608 132,755,063 157,239,495 172,133,229 191,618,864 388; 856,725 St. Louis 39, 721,655 34. 016,112 45,217,434 64,774,142 61,347,269 95,385,131 106; 057,277 Minneapolis... 747,060 !4; ,008,540 26,887,172 51,803,752 32,237,642 61,886,266 61 044,132 KarfsasCity... 44, 769,907 21. 669,881 32,366,838 56,353,687 95,988,964 63,504,383 83 383.186 Dallas 12, 386.992 12. 652,185 24, 745,932 40,723,522 39,427,035 45,453,965 52 244,194 San Francisco. 36, 754,011 36 ,690,078 40,883,735 48,553,047 65,883,018 52,939,476 104 902, 2."8 Total, 1918... 1,525,984, 729 1,443, 795,053 1,993,080,060 j 2,605,719,776 3,309,207,111 3,655,663,674 3,490,037,016 Total, 19171. 49,105,350 99,502,895 66,495,153 J 95, 738,818 174,128,766 887,502,360 547, 434,009 Total, 1910... 37,150.980 40,028,950 50,981,150 ! 50,861,300 48,199,800 GO,785,340 64,354, 450 Total, 1915... 23,450,300 20,345,800 26,834,900 \ 17,838,900 20,242,500 23,179,300 27,048,000 Federal Reserve Banks August. September. October. November. December. Total. Boston $142,88)0, 762 $249,026,303 $338,394,033 $373,350, 564 $456,202,416 $2,039, 591,682 New York... 2,427,233,SSH 3,081,248,564 4,380,072,963 3,248,358,733 5,508,007,483 30,509,109,901 Philadelphia. 150,366,382 167,232,191 254,394,243 368,823,184 516,200,472 1,978,466, G4u Cleveland 146,589,352 160,066,781 189,488,962 226,108,688 339,369,955 1, 766,465,316 Richmond... 174,826,575 218,416,000 230,835,278 287,101,541 299,680,044 2,263, 333,762 Atlanta 84,170,635 123,787,635 179,821,536 167,886,039 172,763,597 1,016,112,678 Chicago 416,849,317 466,437,999 573,528,028 383,127,310 296,880,658 3,536,026,327 St. Louis 92,879,874 120,403,692 159,347,799 158,469,909 140,181,080 1,117,801,374 Minneapolis.. 87,403,974 77,127, 901 65,136,063 40,879,414 17,623,363 543, 785,279 Kansas City.. 58,860,158 78,861,372 126,621,271 110,124, 747 86,837, 955 859,342,349 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

No. 40. Total investment operations of Federal Reserve Banks during each month of 1918—Continued. Federal Reserve Banks I August. September. October. November. December. Total. Dallas $69,044,935 $76,531,393 $89,433, 580 $77,998,599 $95,104,214 $LV35, 746,546 San Francisco. 104,500,085 134,829,649 205,944,879 126,980,039 189,882,582 1,148, 748,857 Total, 1918... ,955,611,937 4,953,969,540 0, 793,018,635 5,569,708,767 8,118, 733, 819 47,414,530,717 Total, 19171.. 297,023,452 678,062,976 2,770,806,092 3,394,410,518 1,137,104,390 * 10,197,320,845 Total, 1916... 47,902,200 58,679,500 63,282,160 79,644,600 139,531,250 741,401,680 Total, 1915... 29,375,000 23,556,300 23,961,000 38,178,700 33,760,100 307,770,800 No. 41.—Average amount of earning assets held by each Federal Reserve Bank during 1918. earnings from each class of earning assets, and annual rales of earnings. Average balances for the year of the several classes of earning assets. Earnings from- Federal Reserve Banks. Bi f l o l r s d m is e c m o b un er t s e d Bills bought United States Municipal war co B u i n ll t s e d d is f or Bills bought R a e n se d rv F e e d B e a r n a k l s.) in op k e e n t . mar securities. rants. Total. m s F e e e r m v d e e b r e B a r l s a n R a k e n s d . in op k e e n t. mar Boston $76, 415,140 $22, 217,329 $102,280,801 $3,068,027 $931,701 New York 075,629 133, 095, 779 $69,761 622,631,646 17,736,261 5,411,821 Philadelphia. 556,041 18, 375,123 1,068 101,067,237 3,241,105 756,313 Cleveland 73; 080,025 175,073 117,976,652 3,124,696 1,141,584 Richmond 54; 299, 950 410,716 G4,103,004 2,390,422 273,634 Atlanta 41. 159,081 199,908 (J8, 795 52,173,482 1, 758,075 302,231 Chicago 150; 018,487 574,709 13,699 191,167,183 6,447,466 1,253,259 St. Louis 51; 755,325 406,798 60, 789,493 2,218,069 226,104 Minneapolis.. 33; 463,611 851,231 139 42,128,848 1,547,842 211,602 Kansas City.. 55; 732,674 707,610 71,509,299 2,643,113 157,962 Dallas 32. 083,680 288, 783 197,168 42,609,374 1,497,379 175,885 San Francisco. 413,505 119,331 88,621,471 2,671,397 1,097, 030 Total. 1,140,053,148 288, 422,390 128,232,322 350,030 I 1,557.058,490 48,343,852 11,939,786 L1917 figures arc exclusive of purchases of certificates of indebtedness. 2 Includes $213,607,152, bills discounted for or purchased from other Federal Reserve Banks. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Earnings from- Calculated annual rates of earnings from- ©o GO Federal Reserve Banks. S c U t u a n r t i e i t s t i e e s d s e . M wa u r n r i a c n ip ts a . l Total. a c n m o B R d u i e e l n m F l s s t e e e b r d d d e v i e f r e s r s o a r l o b p o e u B k n g e il h t m l . t s a in r S c U t u a n r t i e i t s t i e e s d s e . M wa u r n r i a c n ip ts a . l Total. 5 Banks. 2 Per cent. Per cent. Per cent. Per cent. Per cent. i Boston ...! $107,719 $4,107,447 4.01 4.19 2.95 4.02 co New York j 1,561,839 $2,621 24,712,542 4.04 4.07 3.10 3.76 3.97 o Philadelphia | 233,489 49 4,230,956 4.29 4.12 3.27 4.59 4.19 Cleveland 611,894 4,878,174 4.28 4.20 3.45 4.14 > Richmond | 83,437 2,747,493 4.40 4.27 2.46 4.29 Atlanta 114,451 2,889 2,177,646 4.27 4.20 3.06 4.20 4.17 3 Chicago | 310,616 662 8,012,003 4.30 4.24 2.69 4.83 4.19 St. Louis | 89,096 2,533,329 4.29 4.18 2.46 4.17 Minneapolis j 116,370 6 1,875,820 4.63 4.36 3.05 4.47 4.45 o Kansas City j 312,463 3,113,538 4.74 4.26 2.59 4.35 Dallas I 152,159 7,995 1,833,418 4.67 4.10 2.52 4.05 4.30 u San Francisco I 135,268 3,904,295 4.65 4.20 2.66 4.41 > Total ! 3,828,801 14,222 64,126,661 % 4.24 4.14 2.99 4.06 4.12 i w !> w w. CO Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

No. 42.—Calculated annual rate (per cent) of earnings from total investment holdings for each Federal "Reserve Baiih, by months, during the calendar year WIS. Febru Septem Novem Decem January. ary. March. April. May. July. J August. ber. October. ber. ber. Total. Boston 3.77 3.81 3.85 4.19 3.95 4.34 4.24 4.23 4.18 4.09 4.05 4.02 New York 3.63 3.67 3.89 3.99 4.05 4.06 4.13 4.16 3.95 4.01 4.05 4.00 3.97 Philadelphia.. 3.77 3.85 3.92 4.05 4.07 4.20 4.27 4.20 4.32 4.31 4.34 4.17 4.19 Cleveland 3.68 3.86 3.89 4.06 4.21 4.27 4.31 4.36 4.30 4.15 4.11 4.09 4.14 Richmond 3. 7i 3.71 4.01 4.08 4.28 4.59 4.55 4.46 4.48 4.46 4.37 4.22 4.29 Atlanta 3.84 3.89 3.97 4.04 4.14 4.20 4.27 4.25 4.24 4.23 4.21 4.19 4.17 Chicago 3.98 3.94 3.59 4.14 4.23 4.28 4.30 4.29 4.28 4.15 4.21 4.25 4.19 St. Louis 4.08 4.08 3.90 4.01 4.24 4.19 4.33 4.33 4.27 4.22 4.18 4.10 4.17 Minneapolis... 4.04 4.17 4.31 4.19 4.53 4.48 4.68 4.64 4.64 4.66 4.22 4.12 4.45 Kansas City... 3.70 3.84 3.26 4.23 4.15 4.41 4.74 4.65 4.59 4.51 4.43 4.51 4.35 Dallas 3.70 3.41 3.75 3.93 4.36 4.16 4.44 4.54 4.70 4.25 4.42 4.57 4.30 San Francisco. 3.96 4.06 4.01 4.12 4.26 4.42 4.40 4.43 4.50 4.51 4.41 4.37 4.41 Total.... 3.75 3.81 3.86 4.07 4.29 4.20 4.31 4.27 4.21 4.13 4.19 4.14 4.12 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Exhibit E.—GOLD SETTLEMENT FUND. No. 48.—Condensed summary of transactions, Jan. 1 to Dec. 31. 1918, both inclusive. [In thousands of dollars.] Summary of Aggregate changes in owner dr w a i w th a ls A d g e g p r o e s g i a t t s e Transfers. Settlements f b ro o m th J i a n n c . l u 1 s i to v e D . ec B in a l f a u n n c d e s b h a ip n ks o f t g h o r ld o ug b h y Federal Reserve Bank of— B J a a l n a . nc l, e w G i o t l h d de G po o s ld it s. tra a n n s d fe rs tra a n n s d f ers clo a s t e of t t r l a e n m s e fe n r t s s . and set 1918. drawals, to from business agent's agent's Dec. 31, fund. fund. Net Total Total Net 1918. 'Debit. Credit. debits. debits. credits credits ! Decrease. Increase. a Boston 14,977 154 52,162 42,654 72, ,067 182, 144,021 734, 31,784 37,295 7,097 o New York.. 20,S54 13,020 195,058 154,020 331, 058 769, 3,308,697 2,070,339 .•507, 12,837 66,790 131,102 .......... F O LTuladelphia 39,101 8,875 77,254 1(14, 036 193, ,987 333, 123,297 945, 5,124 178,969 37,412 31,041 Cleveland... 37, 664 33,871 50, 153 151,871 119, 159 509, 50,792 728, 4, 234. 506,347 52,125 4V, 171 Richmond.. 22,101 9,435 25,759 00,430 38, 759 150, 90,934 327, 2,401, 73 2°6 14,254 13,829 H Atlanta 13,007 950 21,050 105,500 115, 400 108, 87,680 435, 1,439. 4,289 6,302 16 005 Chicago 48,319 7,941 103,140 561,078 493, 402 152, 628,685 754, 6,403, 649,693 106,772 126,129 St. Louis.... .17,SS4 14,098 12,435 97,978 62, 361 94, 45,421 863, 2,945, 82,426 15,974 33,708 Minneapolis., 20; 487 138 16, 752 58,138 43, 952 209, 17,487 288, 1,497, 209,438 23,774 17 474 Kansas City.. 37,087 2,911 20, 666 51,410 06r> 551, 11,369 2,277, 523,879 23,237 16,105 Dallas 24,521 8,352 15,991 33,561 43, 090 198, 85,000 910,: 997, 86,759 6,935 27,114 San Francisco 15,(142 2,088 90,700 133,448 138, 111 551, 21S, 722 ,190, 1,513, ,323,529 11,056 9,250 Total... 311,044 102,43. 693,1^1 ;1,614,730 1,705,012 4,812.105 ,4,812,105 45,439,487 I 45,439,48 2,670,339 401,926 238,314 2:.-:8,314 i I Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

No. 44.— Weekly operations through the gold settlement fund during the calendar year 1918. [In thousands of dollars.] Transactions, all Federal Reserve Transactions, Federal Reserve Bank of New York. Banks. > Combined Clearings. Transfers. ; Clearings and transfers cj Date. Total Total c t o ra T m n o b s t i f a n e l r e s d fo T r r c a r n e s d fe it r s o f] c d l e e T b a o i r t t i s a n l g i n s a c d n l e d e b a t i r r t i s a n n g in s s ! combined. > clearings. transfers. New York of the fers for cle a ar n i d n gs. bank. Ne b w a n Y k o . rk c th re e d N it e o w f Net debit. Net credit. \ Net debit. Net credit. Net debit, Net credit. York bank 1918, O Jan.3 536,945 •36,400 573,345 2,000 160,147 162,147 23,900 39,652 Jan. 10 690,242 63,500 753,742 41,000 203,297 244,297 13,337 43,837 3 Jan. 17 723,635 72,500 796,135 22,000 251,710 273,710 24,330 16,000 40,330 Jan. 24 , 819,561 97,000 916,561 74,000 271,157 345,157 1,422 51. 52,422 Jan. 31 642,158 96,140 738,298 56,000 208,438 264,438 24,217 16. 8,217 o w Feb.7 602,539 107,000 709,539 76,000 207,878 283,878 42,264 46 3,736 H Feb.14 551,908 112,362 664,270 101,000 201,467 302,467 79,030 98, 18,970 > Feb. 21 710,081 64,400 774,481 32,500 240,142 272,642 54,123 8. 46,123 F Feb. 28 587,027 35,000 622,027 24,000 183,098 207,098 31,494 20 11,494 W Mar. 7 771,168 85,000 856,168 55,000 253,017 308,017 39,903 32 7,403 H Mar. 14 661,936 11,330 673,266 221,385 221,385 73,991 4,000 77,991 W W Mar.2l 696,825 37,000 733,825 34,000 213,710 247,710 14,395 31, 16,605 w A M p a r r . . 4 2 8 7 7 3 8 3 8 , ,9 0 1 6 2 8 7 7 7 3, , 0 4 0 6 0 3 8 8 6 0 6 6 , , 3 0 7 6 5 8 6 7 4 0 , , 0 0 0 0 0 0 2 2 6 4 0 8 , , 8 98 4 7 0 3 3 ' 1 3 2 0 , , 1 8 8 4 7 0 2 4 5 2 , , 2 2 7 5 8 8 5 6 5 5 ; ; 2 29 2 , , 7 7 2 4 2 2 w o Apr. 11 694,860 37,500 732,360 33,5C0 230,079 263,579 38,022 29, 8,522 > Apr. 18 811,089 169,900 980,989 130,500 282,915 413,415 59,528 93 33,972 © Apr. 25 897,166 75,000 972,166 56,000 306,703 362,703 55,749 44 11,249 May 2 769,773 136,000 905,773 105,000 246,172 351,172 43,090 80 36.910 May 9 819,746 81,600 901,346 48,000 288,846 336,846 63,589 17. 46,189 Mayl6 855,420 150,700 1,006,120 88,000 299,908 387,908 60,461 50 10,161 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

May 23 J 811 721 69,SCO 881,521 38,000 246,964 284,964 14,753 22,000 ' 7,247 May 31 746 483 72,OCO 818,483 43,000 248,267 291,267 76,279 22,000 54,279 June 6 711,493 131,000 842 493 89,000 228,883 317,883 13,618 47,000 34,382 June 13 824 499 83,000 907,499 40,000 254,463 294,463 10,324 3,000 13,324 June20 944,258 196,000 1,140,258 97,000 304,608 401,608 8,213 19,000 27,213 June 27 898,469 114,400 1,012,869 60,000 290,582 350,582 28,472 18,000 10,472 July3 1,090,900 251,679 1,342,579 180,665 382,271 562,936 22,372 119,005 96,633 July 11 743,803 25,000 768,803 8,000 271,236 279,236 73,839 4,000 77,839 July 18 990,740 114,000 1,109,740 95,000 313,980 408,980 35,306 77,000 112 306 July 2,5 944,335 80,000 1,024,335 65,000 317,305 382,305 31,648 50,000 18 £52 Aug.l 838,707 97,000 935,707 93,000 273,774 366,774 39,371 89,000 49,629 Aug. 8 812,164 15,000 827,164 15,000 300,421 315,421 106,173 15,000 91,173 Aug. 15.... 806,193 55,056 861,249 35,000 278,269 313,269 84,488 35,000 49,488 Aug. 22 853,803 21,000 874,803 17,000 290,989 307,989 83,814 17,000 66,814 Aug. 29 894,369 47,000 941,369 35,000 302,765 337,765 81,709 35,000 46,709 Sept. 5 787,282 79,000 866,282 74,000 259,372 333,372 11,027 74,000 62,973 Sept. 12.... 852,452 35,162 887,614 35,000 327,732 362,732 122,834 35,000 87,834 Sept. 19.... 959,528 59,000 1,018,528 53,000 321,911 374,911 55,333 53,000 2,333 Sept. 26.... 953,752 28,000 981,752 28,000 302,447 330,447 36,374 28,000 8,374 Oct.3 1,028,560 46,404 1,074,964 41,904 327,050 368,954 4,958 41,904 36,946 Oct. 10 1,049,820 50,960 1,100,780 39,000 369,355 408,355 41,110 39,000 2,110 Oct. 17 994,260 23,000 1,017,260 19,000 344,135 363,135 52,603 19,000 33,603 Oct. 24 ! 1,208,208 56,588 1,264,796 49,000 395,147 444,147 25,012 49,000 23,988 Oct.31 1,263,293 73,667 1,336,960 58,000 442,451 500,451 58,489 58,000 489 Nov. 7 1,011,226 92,303 1,103,529 45,000 344,249 389,249 21,661 45,000 23,339 Nov. 14.... 955,719 93,743 1,049,462 18,583 319,087 337,670 3,148 11,417 14,565 Nov. 21.... 1,100,780 226,058 1,326,838 89,861 405,420 495,281 117,411 79,861 37,550 Nov. 29 1,160,334 144,741 1,305,075 99,631 426,856 526,487 119,072 99,631 19,441 Dec. 5 930,853 127,103 1,057,956 76,171 348,230 424,401 107,731 76,171 31,560 Dec. 12 1,044,159 287,468 1,331,627 234,698 401,266 635,964 133,922 234,698 100,776 Dec. 19 1,082,467 165,188 1,247,655 119,863 391,869 511,732 100,862 119,863 19,001 Dec. 26 944,679 64,651 1,009,330 54,352 374,494 428,846 156,052 54,352 101,700 Total 44,608,368 4,643,766 49,252,134 3.158,228 15,185,744 18,343,972 2,611,609 68,602 59,317 2,442,685 1,043,664 884,025 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

198 ANNUAL REPORT OE THE FEDERAL RESERVE BOARD. OPERATION 5 THROUGH | || „ GOLD SETTLt 'MENT FUND Li & DURING THE CALLZ HDAR YEAR 1918. SH j 3 Curve!.- &e&i£s inSetdemenb <j/V&£ Jl£»> J^Mr J?t)?. J5U*&fo ^ 1 Q (Mrvc2.'Cbntbuted^cfftires 1 & Jhvnsfisrsibr (redd? cffho flhdi^ijpSs^Umentand I § !i IX ^Trtf J.- WteOyJabalSi Is Curve4. CbmbOt&lfteefettfJ aunsafSetf£em&rf&. | ~ 11 ju ^j and/lTiter-ZBc vnJCMmsfers. 5 1 | | Hi M il , 1 H 19 M i/OTiH Y\I5Q0\ 1 Ml i^ii 1 /^t7 Mill " r^Jl r i 1 1 1 1 1 1 1 1 /• M N r« mill 1 pG7r I 1 1 I 1 1 [ f 1 I 1 ( j I 1 1 ] 1 I I I 1 1 1 1u i/i t ni >+/ . Iff m \\i I \i MM fjffWTll • l/JW/- j j 1 j 1 1 [ 1 1 i j 1 j 1 1 1 1 1 1 1 | 1 1 1 j 1 II 1 j 1 1 j II 1 1 1 || 1 J j 1 1 j 1 1 1 1 1 j 11 1 j' 19 JHI i 1 II 1 1' 1' l 1 A I ft ?/MM • ///nil \\HQO\ \ \ \ \ \ \ \ \ \ \ \ \ \ \ \ \ \ \ \ \ \ \ \ \ \\ i r 1 ttlMlmfnl I M 1 M N mI n \\\\\\IM \M ffiUI II 1 * ¥ n! 1V)\ Fw f M / f F^l 1 • - M \\\n\ m\ 1 11 1 1 \ / * thHi« : 1\! V M I II 1 iLJ 1 1 1 1 1 1 1 1 1 If M 1 1 11 HI MM 1 MllWBr fV IM /M I1/ IOT?!! II <rvA i 8 1 La i //V 'If 1 Imrf 1 1 UiiffliM t itHM'rti i IB wWlV/ I M ^ M IM fl tiffl 1B! 1 w T 1f/ | 1 wf^m^llii IJ «%41™ m SllliI 1 | j M J 1 1 1 I 1 M 1 II 1 1 1 M 1 1 1 M r^ii ILJ1 H/f 1 M M? ii Infi IN i 1 Mi1 pw\m 11 1 T ! T I 1 1 1 1 1 1 I 1 1 1 1 I 1 I 1 iI 1 1 I M Mi 'J M1 \1l 11 11 I•[ |/XyCy}/j| MM ML a m M 1 M A 1 l f / \ • i i N J^ m YJlf l l 1 1 M 1 1 1 11 M1l, 1 I I 1 1 [I I I 1 I I 1 1 1 Fli)/i!Vi M Ml/ | jI* 1T il 7 I II IS I /too i R • 'k f eif l m ft\ \\[M\ \\ \\ \M k \IVJ I\\ *\ \M \ M(fnl iI!H mi 1v i1ff r v?i!\ s! \ 1 I " IM'HIT IT wiWrnii MT I MUI 1 \VY)l y A w 1 li i la H w ' 1 MtTtJ l U ff lU WM \y^n\ / T I M 1 P^U 1J MwfrffTi ms 1 \2O0\ w rrf w } ' wJU\E , \//Y) Ii I /cC/j M 1 M 1 1 1 i 1 1 r II 1 1 1 1 1 II II 1 II r II I tf 1 II 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 II 1 1 3M7M3l7#2l£8?#2I284lll*Xt3JeS33l6£!2O0Z tjtyf^M.W&sf~J,¥71&'&fJJ/S^£lfJ-fri*M^ \\ 1 JAM. 1 t*£B.\Mai. 1 /f/frKl MArUuh\JsU LY\AUG.\<SEPT. ! C?Cr 1 NOVA DEC. 1 IE Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

No. 45.—Gold settlement fund—Changes in ownership of gold through transfers and settlements by weeks. [In thousands of dollars; i. e., 000's omitted.J Boston. New Fork. Philadelphia. Cleveland. Richmond. Atlanta. Chic ago. Week ending. Increase. Decrease. Increase. Decrease. Increase. Decrease. Increase. Decrease. Increase. •n Increase. Decrease. Increase. Decrease Decrease. I 1918 Jan. 2 and 3 11,471 34,252 7,664 23,801 1,915 5,853 22,705 10 14,278 43,837 10,586 u8,988 2,704 3,062 3,500 17 12,641 40,330 4,156 41,366 2,837 269 24,097 ! 24 4,135 52,422 4,974 3,629 2,593 1,141 37,494 31 12,750 8,217 920 8,009 833 2?348 15,443 Feb. 7., 12,066 3,736 10,523 10,533 4,971 3,108 7,527 U 19,334 18,970 14,158 15,697 3,379 6,316 11,395 21 10,134 40,123 5,367 363 6,167 2,522 22,664 28 7,538 11,494 333 6,868 8,982 2,553 9,034 Mar. 7 . 18,231 7,403 3,354 1,899 3,616 4,023 1,102 14 .... 373 77,991 3,597 6,715 3,834 2,194 38,329 21 16,605 3,831 5,008 fc 3,668 5.916 23 22,742 2,206 1,006 5,161 1,081 4, 968 Apr. 4... . 2,14S 29,722 2,106 2,434 2,911 402 29,101 11 5,402 8,522 1,538 2,220 5,023 3,344 13. 10,614 33,972 10,869 2, 644 9,87-1 3,716 5,548 25 642 11,249 19,004 27,245 8,921 3,715 2,723 May 2 10,314 36,910 5,009 . 14,39 6 4,468 6, 152 4, 90S S. 370 46,189 11,830 12,559 1,250 600 6,709 10 10,161 2,908 9,098 7,960 2,081 3,661 23 5,958 7,247 9,682 3,910 16,254 6,606 11,716 31. . . 7,635 54,279 6,307 1,020 1,1»\8 1,953 6,960 June 6 .. . . 2,513 33,382 8,961 10,604 5,862 1,965 20,319 13..... . . . ... . 7,105 13,324 6,446 3,349 351 1,402 3, 447 20..... ... .... . .. 620 27,213 17,819 40,862 4,212 2,900 16,286 27 1,313 10,472 7,460 24,858 16,217 2,212 25,033 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

No. 45.—Gold settlement fund—Changes in ownership of goldt hrough transfer and settlements by -weeks—Continued. o [In thousands of dollars; i. e. , 000"s omitted.] Boston. New York. Philadelphia. Cleveland. Kichmond. Atlanta. Chicago. Week ending. Increase. Decrease. Increase. Decrease. Increase. Decrease. Increase. Decrease. Increase. Decrease. Increase. Decrease. Increase. Decrease. 1918 July 5 4,043 96,633 214 9,461 23,834 5,665 18,369 11 4,634 77,839 9,111 5,574 5,525 3,818 20,053 18 20,071 112,306 1,327 26,677 4,349 2,646 42,217 25 7,025 18,352 4,831 1,077 3,386 2,111 9,554 Aug. 1 9,543 49,629 249 1,431 3,942 6,493 20,047 8 17,669 91,173 1,379 8,010 1,420 2,870# 43,705 15 4,165 49,483 7,712 1,495 13,502 23 4,498 22 9,482 66,814 3,657 13,400 4,289 2,368 14,915 29 .... . . 575 46,709 14,335 8,262 3,635 5,853 18,665 Sept 5 14,512 62,973 8,956 14,875 1,575 1,451 9,223 12 7,944 87,834 651 18,794 774 5,720 24,304 19 4,738 2,333 7,671 1,447 2,171 3,360 4,783 26 3,983 8,374 8,234 18,266 5,962 1,300 5,015 Oct. 3 5,654 36,946 4,951 23,106 2,613 1,747 56 10 . . 1,921 2,110 2,415 1,641 4,552 11,071 13,504 17 1,404 33,603 7,049 8,662 3,349 3,062 2,845 24 10,779 23,988 13,812 6,550 5,926 19 6,423 31 47,015 489 3,736 10,912 6,388 11,043 11,512 Nov 7 28,041 23,339 22,432 22,512 11,096 6,448 7,200 14 10,129 14,565 20,468 17,091 5,385 3,514 41,070 21 3,020 37,550 8,611 13,842 3,609 14,581 62,945 29 8,614 19,441 5,758 14,191 8,789 5,857 4,617 Bee 5 11,927 31,560 6,266 3,950 1,146 1,419 11,055 12 . 11,255 100,776 6,518 26,032 3,025 2,507 56,507 19 9,063 19,001 710 11,587 5,549 340 17,270 5,877 101,700 17,951 30,628 627 657 21,353 .... . Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

27,28,30,31 4,686 ' 23,132 1 14,980 10,707 2,902 ! 5,491 ' 18,158 Total 229,718 236,815 907,157 1,038,259 184,320 215,301 357,288 310,114 143,707 129,878 83,475 100,080 490,002 30o 873 47,174 13,829 120,129 7,097 131,102 31,041 10,005 ' ! St. Louis. Minneapolis. Kansas City. Dallas. San Francisco, Total. Week ending. Increase. Decrease. Increase. Decrease, Increase. Decrease. Increase. Decrease. Increase.} Decrease.! Increase. 1918 Jan. 2 and 3. 3,428 2,290 1,414 2,472 j ',006 10 1,855 1,561 4,361 4,776 1,396 i V452 17 3,151 1,736 214 1,710 17,763 I ., 135 24 2,180 4,742 752 2, 485 20,851 699 31 196 160 1,322 175 3,031 702 Feb. 7. 3,607 2,284 2,606 4,682 14,277 900 14. 8,782 1,313 3,923 4,018 2, 253 769 21. 184 289 8,561 2,369 659 23. 3,715 2,844 4,259 4,752 4,010 191 Mar. 1,238 2,409 J 11,050 2,548 3,027 950 14. 4,372 6,925 I 6,575 589 6,412 953 21. 1,036 5,687 j 2,439 1,952 776 28. 3,705 1,259 |. 11,473 4,283 2, 444 055 Apr. 4. 5,905 308 I 5,570 10,201 409 11. 2,200 3,617 j 1,861 2,641 1,187 258 18. 5,971 6,284 7,130 4,260 0,821 850 25. 4,051 700 2,929 3,365 1,000 102 May 2,140 1,996 3,294 6,915 | 834 9 i 3,336 4,914 | 4,871 370 10 22.670 4,174 ' 10,371 531 2,804 ! 159 23 9,155 1,052 13,925 1,104 ! 837 31 ! 10,149 4,514 1,247 j 836 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

No. 45.—Gold settlement fund—Changes in oivnership of gold through transfer and settlements by iceelcs—Continued. [In thousands of dollars; i. e., 000's omitted.] St. Louis. Minneapolis. Kansas City. Dallas. San Francisco. '• Total. Week ending. Increase. Decrease. Increase. Decrease. Increase, Decrease. Increase, Decrease. Increase. ,Decrease. Increase. Decrease. 1918 June C 12,989 10,450 6,327 1,405 3,953 59,413 13 5,041 2,003 1,106 3,993 4,139 I 25,853 20 10,556 1,661 14,738 3,170 2,999 71,518 27 9,599 12,588 422 2,041 4,003 58,134 July 5 22,055 7,707 13,902 2,744 7,561 106,094 11 17,570 3,213 5,258 6,758 5,593 82,473 18 13,530 1,343 1,067 1,414 5,313 110,130 25 1,170 1,349 1,945 872 2,892 27,285 Aug. 1 3,667 10,061 7,471 G,497 7,146 03,088 8 8,903 1,925 5,925 5,244 279 94,251 15 8,370 4,701 3,888 1,007 168 49,500 22 6,289 2,324 10,778 3,736 7,696 72,874 29 1,749 388 7,720 690 41 54,311 Sept. 5 3,787 2,324 6,641 2,607 2,236 Co,580 12 3,190 12,464 1,628 8,159 10.586 91,024 19 4,479 2,330 4,974 265 2,001 20,270 23 3,419 1,097 4,917 3,850 0,097 35,257 Oct. 3 1 7,323 3,863 333 2,915 3,833 40,070 10 9,495 16,559 11,058 1,532 2,822 39,310 17 6,877 8,899 7,758 2,804 7,352 46,562 24 .....,_.,, 380 1,641 3,766 078 9,578 41,770 j 31 14,621 18,501 7,585 3,301 4,737 09,950 Nov. 7 1,353 13,087 7,777 2,038 27.933 89,128 U 1,227 7,486 18,475 4,097 3,331 73,719 21 3 124 Q 006 9,478 5,975 13,429 92,585 29 138 < 8,033 ! 7,377 129 1,54S 42,246 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Dec. 5 4,887 1,729 5,872 2,296 4,621 43,364 12 1,420 [ 2,244 2,809 5,351 1,674 110,302 19 7,233 254 6,007 4,499 7,417 *.. 44,468 26 12,273 781 7,505 2,539 4,082 102.984 Dec. 27, 28,30,31. If), 174 ! 2,818 12,335 869 11.908 59,585 i Total 183,453 i 149,745 | 129,808 112,394 147,001 103,700 03,912 91,020 140,021 155,871 3,007,122 Net increase., 33,708 ' i 17,474 Net decrease. 10,105 27,114 9,250 s 3 R H H k el to O C/3 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Exhibit F.—CLEARING OPERATIONS. No. 46.—Operation of the Federal Reserve clearing system. Jan. 1 to Dec. 31. 1918. b I ( a t d e R n a m k i e l s s s y e i d n r a v r v a e F e w e r c a n d i g t e y e o r n ) a . l b I ( o t a d u e R n a t m i k e s l s i s s y d e i d e r n a v r v F a e d e w e i r c s d n a i t e g t r y r o e i a c n ) l t . T on F o d e t b a i d s l a a e t n i v r r t k a i e e c l s r t m a i R s n g ( e d e d s s ) a . a e r i a l m r y v w e e n , I d b te i a s m n a tr k s v i s e c d r t i r s n a a g w ( o e d n ) t a . h i e o l r y n b I o t ( e d t a h m a n i s d p l y a h b r a a e r n v a n d e n t l r c e a b h d g a e e s n b ) k . y s I ( t d U e T a m n i r l i e s y t a e d s d a r u v a r S e e w r t r n a a o g te f o e s n ) . 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. N b u e m r. Amount. Boston 7,075 $18,490,797 52,654 843,590 59,729 §26,334,387 6,034 519, 7,448 S3,955,694 New York 10,519 77,175,000 76,406 168,000 86,925 124,343,000 29,727 070, 36,660 16,292,000 Philadelphia. 14,171 22,095,528 28,458 195,819 42, 629 26,291,347 14,310 208. 5,681 3,152,526 Cleveland 34,775 70,409,275 451,093 525,430 ±85,868 ,304,934,705 31,854 80S, 14,825 $45,660,318 38,848 23,670,208 Richmond 1,684 5,575,652 32,258 856,573 33,942 17,432,225 3,948 539, 252 880,728 1,650 427,935 j Atlanta 2,384 3,047,848 15,355 636,771 17,739 5,684,619 2,032 025, 1,847 1,696,660 2,805 1,358,140 | Chicago 10,176 22,494,000 34,362 413,000 44,538 29,907,000 3,596 976, 286 370,000 9,363 3,760,000 I St, Louis 3,136 7,962,064 14,131 449,458 17,267 10,411,522 434 062, 365,432 4,915 1,050,809 Minneapolis.. 2,997 8,040,523 16,464 750,087 19,461 9,.790,610 987 "02, 714 183,030 Kansas City.. 2,840 8,883,818 39,014 800,487 41,854 20,744,305 3,862 820, 2,631 2,117,595 4,215 548,589 Dallas 1,312 1,936,631 18,217 957,787 19,529 7,894,418 1,627 367, 964 260,134 2,108 380,874 San Francisco 4,655 6,559,018 21,807 290,238 26,462 10,849,256 594 217, 2,576 1,492,459 3,366 2,233,124 Total... 95,724 1252,670,154 803,219 341,947,240 895,943 J594,617,394 99,005 104,318,213 23,789 52,843,320 117 57,018,929 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

No. 47.—Number and amount of items handled during 19IS; also cost 'per item ana per $1,000. | Federal Keserve Bank. b T e h o r a t a n o l d f n l i e t u e d m m . s To h ta a l n a d m le o d. u nt E d t x m r e p a p e e n a n n s r s t i t . e t s, h C a o i n t s e d t m l p e e d r . t C h d o o o u s ll t s a a p r n s e . d r 1 Federal Reserve Bank, j \ | b T e h o r a t o a n f l d i m l t e e i d m n . i s - To h ta a l n d am le o d. u nt E d x t m r e p a p e e n a n n s r s t i t . e t s, h C a o i n t s e d t m l p e e d r . t C d h o o o s l u l t a s p a rs e n . r d Number. Dollars. Dollars. Cents. Cents. i Number. Dollars. Dollars. Cents. Cents. Boston a 18,782,919 12,778,761,551 159,257 0.84 1.24 Chicago^ j 17,844,934 10,957,230,000 182,242 1.02 1.66 New York & 46,457,582 47,518,425,000 374.265 .80 .79 St. Louise •' 6,105,417 1,799,306,081 74,174 1.21 4.12 Philadelphia a 17,133,761 11,292,410,112 i 167,520 .97 1.48 Minneapolis & 0,047,726 2,112,894,212 73,503 1.20 3.47 Cleveland & 14,008,235 9,422,429,678 j 282.198 2.01 3.00 Kansas City 12,055,372 7,552,839,637 147,748 1.22 1.95 Richmond a 11,518,526 6,983,383,300 134,294 1.17 1.92 Dallas* 6,323,378 2,741,224,204 93,277 1.47 3.40 Atlanta & 7,449,479 3,588,292,660 72,260 .97 2.28 San Francisco b ^ lis, 076 4.7(53.954.748 10?, 664 1.18 2.26 Total 172, S43,005 121,511,151,273 1,868,402 1.08 1.54 o Excluding Government items. & Including Government items. c Exclusive of Government and Clearing House items. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

No. 48.—Number of member banks in district; also number of nonmember banls on par list in each Federal Reserve district, by months, for the calendar year 1918. Boston. Y N o e r w k . Ph p i h la ia d . e l Cleveland. n ^. | Atlanta. Chicago. St Louis. 1 Mir o m li e s. a p- K C a i n t s y a . s Da Has. j Fran S c a i n s co. ! Total. 1- £ a , C _ } 5 • , £ O \ r ^ t S ^ 3 O T i * » -l . i " 3 J ° * s ' O £ T « 1 | 1 - ^ | ^ ' M 3 4 g 5 \ L J a s - 4 o -c 1 - £ m r + a a ^ < C 5 4 f A l * g J -, , r a 5 ( C O - O i - ' £ o r0 , M I a o O 3 T s ^ £ ^ t C r -< • t 3 3 r j W o r a f C ^ O l 3 . s . U 2 . , M £ c S- 3 l - 3 C W o I L ^ o s T C S f 3 l •_ . a & a t ,_ ~, • ~^ £ , 1 - • ^ a a C m ° 9 3 s i w s . , ^ a ,_ "d , 1 I ^ § a f < V T 3 l I 2 & : . \ ' I 1 M r 5 M ^ s U s 3 ' £ " % o 1 • r I a c ^ K ° A3 > ss b . , N £ • C ° S 3 * 3 d o ^ ^ a a 3 C M 3 g a «3 . • 3 t a 3 ( , « i i ! M 3 S d § a ^ j ° 1 r j a j 3 O _, - • £ % I M t 0 a C r 3 - s , . 1 | j i M a j ^ _ r X 4 ^ x f a > l n - JU _ , o CP o © o 1 CD © CJ o a o <D o 3° ° o a o oa s. S i 8 i « c p s £ S '£ 55 £ <^ Ifc <; £ ^ & * £ ^ & e5 £ ^ ^ S S^ |>t 1 5 r-; ^ Jan.15 403 249 667 397 638 312 769 549 533 264 392 , M 1,109 2,235 479 987 781 1,041 962 1,527 633 208 j 559 1,158 7,925 9,111 Feb. 15 406 254 674 392 642 315 771 564 535 262 394 184 1,128 2,229 479 1,003 790 1,067 960 1 1,529 633 218 I 563 1,138 7,975 9,155 Mar. 15 410 252 678 388 642 315 769 619 536 281 396 198 1,137 2,223 485 1,002 795 1,077 960 1,535 638 255 1 571 1,139 8,017 9,262 Apr. 15... 413 249 680 384 645 317 771 626 540 i 259 397 199 1,151 2,260 482 1,004 803 1,077 967 1,537 651 275 578 1,128 8,078 9,315 Mav 15 414 249 684 379 646 319 775 628 540 287 403 194 1,156 2,284 484 1,002 808 1,070 967 1,559 675 269 586 1,123 8,138 9,3G3 June 15 416 249 686 376 646 321 635 543 341 407 197 1,164 j 2,278 487 1,012 818 1,143 972 1,568 678 270 j 600 1,114 8,192 9,504 July 15 416 249 689 371 646 325 782 690 546 345 411 200 1,174 2,296 489 1,014 823 j 1,121 973 1,573 1 686 281 608 1,105 8,241 9,570 Aug. 15 417 248 703 380 649 325 785 708 549 359 i 412 201 1,192 2,344 498 1,024 831 1,114 i 978 1,985 701 243 ! 612 1,102 8,327 10,011 418 248 703 360 653 325 798 .697 554 356 414 203 1,253 2,409 502 1,049 842 1,109 986 2,208 707 245 621 1,083 8,451 1 10.292 Oct. 15 421 245 713 i 347 | 655 328 803 689 ! 559 351 418 205 ; 1,285 2,337 502 1,049 850 1,100 1 989 2 227 | 718 249 628 1,073 8,539 10,200 421 244 717 345 16 56 328 806 688 560 349 1 420 206 1,321 2,274 513 1,041 856 1,101 993 2,217 1 720 251 631 1,081 8,614 10,105 422 246 1 721 ! 341 680 329 j 812 731 560 351 i 421 209 1 J ,32 5 2,368 1 512 1,046 861 1,161 993 2,210 | 717 247 j 638 1,056 8,643 10,295 31 1 423 2-16 j 723 j 339 681 | 329 j 814 728 5C5 351 423 209 | 1,334 2,392 514 1 1,048 837 1,169 994 2,200 727 247 | 644 i 1,049 8, <i92 10,305 1 1 j i Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Exhibit G.—CERTIFICATES OP INDEBTEDNESS. No. 49.—Subscriptions, by classes of subscribers, to certificates of indebtedness issued in anticipation of the third and fourth Liberty loans. SIX ISSUES OF CERTIFICATES OF INDEBTEDNESS PRECEDING THE THIRD LIBERTY LOAN. NTational banks. State banks. Trust companies. Other banks. k sk '•$ fefi a SP s W C &> Federal Re- •^ •9 I .9 Serve Bank. V & € C3 JS at 8 ©+j 3 8 ©-»j g © -*» ^ P V©N+*C3 P p « © ~* •5 q u -*J t/5 +^ Ot-S. 1 P % a i a P § p s a p 0> a p t>i a y PH .< y \ P. < 350 88.16 $136,172,500 193 75.40 $72,472,500 New York 579 92.94 723,314,500 208 ; 90.83 $90,233,000 182 91.92 407,380,000 Philadelphia.. 578 90.31 123,319,500 200 68.26 61,990,000 737 98. 53 139,810,500 787 94.36 36,204,000 219 94.80 60,636,500 Richmond 342 64.04 43,115,000 448 > 34.57 15,521,000 71 36.41 17,058,000 Atlanta 332 87.36 44,019,000 S43 ! 52.43 34,502,000 7 70.00 713,500 914 77.85 159,931,000 3,627 84.17 159,875,000 St. Louis 458 97.03 64,025,500 1,623 74.04 46,194,000 176 78.22 20,281,500 Minneapolis... 469 60.91 54,223, .500 1,178 40.55 32,46.8,000 Kansas C it v... 824 8H. 03 80,274,500 2,005 ; 67.59 33,781, .500 52 61.90 8,593,000 Dallas 55,964,000 22,790,500 3an Francisco. 497 92. 72 93,969,500 823 67.96 50,566,500 72 77.42 23,145,000 1,718,139,000 499,345,000 095,060,500 nibir Individuals, cor porations, etc. c th .9 03 V 8 •*> © 8 .C p *©£ 8 -u 1 © P S3 P P © P a p a y PM «* Vi 70 17.16 $5,709,000 12 71 39.66 '10,660,000 170 118 45.56 8,685,000 14S 49 8 14 189 119 50. g5 2,566,500 18 164 502 2.740. .500 * 228 30,361,000 -bus Total. Is p '•*- tr. •p © 9 ti •a ~j* -^.9 o P of "*HH P© © © °'3*- u v- u g B % S $ ©•=; p © fit! u p © P © f: a -+< y (^ tt *<\ $63,000 613 57.77 12 $214,417,000 23,720,500 1,040 84.63 170 1,255,308,000 2,505,500 896 75.17 148 196,500,000 1,382,500 1,743 96.14 49 238,033,500 135,500 • 861 40.52 8 75,829,500 338,500 1,182 59.16 14 79,573,000 5,549,000 4,541 82. S2 189 325,3.55,000 517,000 2,376 76.07 18 133,584,500 2,498,000 1,647 44.83 164 1S9,3.50,01X1 5,875,500 j 2,941 72.53 502 128,524,500 9,430,000 90,925,000e 5,109,500 t,392 75.65 228 172,790,500 57,124,500 , , , i Includes $160,500 puniiased \>; the Federal .Reserve Bank of lanneapolis. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

No. 49.—Subscriptions by classes of subscribers, to certificates of indebtedness issued in anticipation of the third and fourth Liberty loans—Continued. y SEVEN ISSUES OF CERTIFICATES OF INDEBTEDNESS PRECEDING THE FOURTH LIBERTY LOAN. National banks. State banks. Trust companies. Other banks. In p d o i r v a i t d io u n al s s , , e c t o c r . Total. Federal Re serve Bank. "O.M 5 o o 3 O W Boston 381 97.19 $207,115,500 237 90.11 $153,293,000 107 30.03 j$20,662,000 13 | $82,000 725 53.65 13 j $381,152,500 New York 609 98.07 991,095,000 223 99.11 $130,767,500 193 98.47 494,334,500 114 80.90 20,643,000 143 |44,149,000 1,169 95.82 143 'l, 680,989,000 Philadelphia 601 93.18 200,957,500 147 86.98 15,188,500 202 87.44 93,859,000 9 100.00 : 5,129,000 33 | 886,000 959 90.99 33 j 316,020,000 Cleveland. 729 97.72 253,885,000 671 80.45 49,243,000 199 86.14 129,806,000 176 86.27 ! 6,932,000 37 ; 703,000 1,775 88.08 37 440,569,000 Richmond 379 72.61 73,289,000 365 29.15 18,582,500 29.95 | 18,473,000 10 43.48 7,335,000 11 I 304,000 813 40.77 11 117,983,500 Atlanta... 315 80.00 69,015,500 S32 47.46 44,658,500 70.00 j 803,500 17 : 379,500 1,154 53.50 17 114,857,000 Chicago... ,122 99.80 289,539,500 3,316 97.70 349,353,500 843 | 87.10 20,529,000 175 3,782,000 5,281 96.30 175 663,204,000 St. Louis.. 461 98. 50 79,921,000 1,944 89.71 72.675,500 88.99 ! 29,310,000 194 j 83.98 4,877,500 15 179,000 j 2,801 90.56 15 156,963,000 Minneapolis. 714 96.62 69,877,500 2,273 78.27 52,796,000 26 i 4,8S6,500 | 3,017 82.12 26 127,560,000 Kansas City 852 88.38 106,536,000 2,451 78.53 56,755,000 69.04 11,085,000 54 ! 2,490,000 | 3,361 80.61 54 176,866,000 Dallas 525 83.60 49,287,000 661 60.31 19,982,000 42.31 1,994,500 358 '12,056,500 I 1,252 66.59 358 83,320,000 San Francisco. 531 99.06 173,516,500 975 80.51 87,504,500 81.71 37,741,000 40 ! 6,258,000 j 1,582 85.98 40 305,020,000 Total.... 7,249 i 92.82 2,564,035,000 13,858 78.46 ,506,500 j 1,233 80.48 968,705,000 1,549 62.85 88,102,000 922 ,76,155,500 J23,S 4,594,504,000 NOTE.—Figures for State banks, trust companies, and other banks are only approximately correct, since in some States no distinction is made between the several classes of banks operating under State laws. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

EXHIBIT H EAROTSTGS A1STD EXPENSES FOR 1D18. 209 Exhibit H.—EARNINGS AND EXPENSES OF THE FEDERAL RE SERVE BANKS FOR 1918. Total earnings of the Federal Reserve Banks for the calendar year 1918 were $67584,417, compared with $15,438,858 for the calendar ; year 1917, while total current expenses were $12,137,438, compared with $4,235,866 for the earlier year. Current expenses for the year under review include besides $8,463,957 of expenses of operation proper—$2,423,540, the cost, including expressage, insurance, and other expenses incident to the issue and retirement of Federal Reserve notes and bank notes, $1,133,524 depreciation on furniture and equip ment, and $116,417 the cost of alterations and repairs to bank build ings. Total expenses shown above are exclusive of the expenses of the fiscal agent departments. The latter are treated separately, being reimbursable by the United States Treasury Department. For the past year the Federal Reserve Banks, as fiscal agents of the Govern ment, mainly in floating the certificate issues and the last two Liberty loans, disbursed a total of $16,256,689. In addition there was out standing at the opening of the year a reimbursable amount of $1,699,- 661 disbursed by the banks during 1917. Reimbursements received from the Government during the year totaled $8,382,709, leaving thus a reimbursable balance at the end of 1918 of $9,573,641. Net earnings of the banks, i. e., the excess of earnings over current expenses, totaled $55,446,979, or at the rate of 72.6 per cent on an average aggregate paid-in capital for the year of $76,342,000, com pared with an average rate of 55.9 per cent for the first six months of the year and 18.9 per cent for the calendar year 1917. New York shows net earnings for the year at the rate of 113.5 per cent, Kansas City at the rate of 78.4 per cent, San Francisco at the rate of 70.6 per cent, and Chicago at the rate of 67.7 per cent. Of the remaining banks six show net earnings at rates between 50 and 60 per cent and 2 at rates between 40 and 50 per cent. AH arrears in dividends having been paid at the end of June, dividend payments at the close of the year covered only the six months ending December. To the net earnings above shown should be added the net profits carried over from 1917—$1,158,715, also net amounts credited during the year direct to profits—$74,772. This gives total gross profits of $56,680,466. Deductions from this total, $2,805,441, comprise depreciation allowances on bank premises $1,609,537, on vaults $40,500, and on United States bonds $848,129, also special reserves of $307,275 set aside by the New York and San Francisco banks to take care of future contingencies. This leaves available for dividends, surplus, and franchise taxes a total of $53,875,025, out of which were paid all dividend arrears and the maximum 6 per cent dividends for the year, totaling $5,540,684. Of the remaining amount one-half up to 40 per cent of the paid-in capital of each bank was carried to surplus, the total thus carried being $21,605,901. The balance, $26,728,440, was reserved for franchise tax to the Government. It will be noted that in the case of the New York bank the amount reserved for franchise tax is $12,795,215, or more than $5,000,000 in excess of the 40 per cent of the capital, the maximum which the bank is permitted at present to carry to surplus. For the other banks the 100823°—19 14 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

210 ANNUAL REPORT OF THE FEDERAL RESKRVE BOARD. ratios of /surplus to average paid-in capital for the year stand as follows: Per cent Per cent of surplus of surplus to capital to capital paid in on paid in on IV?. 31, I>e-\ 31, 191S. 1918. Boston 22.9 Chicago i 29.6 New York... 40.0 St. Louis I 21.1 Philadelphia. 17.2 Minneapolis i 24.8 Cleveland — 19.6 Kansas CUv ....J ' 33.1 Richmond... 28.5 Dallas 18.8 Atlanta 24.3 San Franc isco 26.4 For the system as a whole the ratio of surplus to paid-in capital is 28.2 per cent. Of the total earnings of the hanks 71.5 per cent, as against 45 per cent the year before, came from discounts, largely of war paper. Bills purchased in the open market contributed 17.7 per cent of the total earnings, as against 32.2 per cent; United States securities, chiefly Treasury certificates, 5.7 per cent, as against 15.3 per cent; transfer operations yielded about 1.5 per cent of the total earnings, as against 3 per cent the year before, and the remainder came from penalties on deficient reserves, service charges, commissions, profits on foreign exchange operations, and sundry smaller profits. Expenses of operation of the banks proper, exclusive of their fiscal agent depart ments, totaled $8,463,957, compared with $2,669,855 in 1917. Of the larger total about 42 per cent, as against 28 per cent in 1917, went as compensation to the clerical staff, and 11.5 per cent, as against 23 per cent in 1917, as salaries to bank officers. Nearly 10 per cent of the total operating expenses went for postage and expressage and over 6 per cent for printing and stationery. Contribu tions of the banks for the support of the Federal Reserve Board aggregated $382,641, as against $237,795 the year before, and con stitute about 4.5 per cent of the total 1918 expenses of operation, as against about 9 per cent the year before. Rent paid by the banks is about double in amount that for 1917, though some of the banks own the premises or parts thereof occupied at present by them. This is true oi New York, Philadelphia, Richmond, Atlanta, Dallas, and San Francisco. With the exception of Cleveland and Minneapolis, all the banks have purchased ground on which it is proposed to erect buildings for use as permanent banking quarters. Total book value of the investments in "bank premises," after allowing $1,609,537 for depreciation, stood at $8,081,841 at the end of the year, compared with $707,611 at the beginning of the year. 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 ivholcfor the calendar year 1918. EARNINGS. Boston. New York. Ph p i h la ia d . e l Cleveland. m R o i n c d h . 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 sc F o r . a n Total. Discounted bills $3,068,028 $17,736,261 13,241,105 124,696 52,390,422 •SI, 758,075$ 6,447,466 ;$2,218,069 SI, 547,842 $2,643,113 $1,497,379 $2,671, 397 $48,343, 853 IJurchased bills 931,701 5,411,821 756,313 141,585 273,634 302,231 1,253,259 226,164 211,602 157,963 175,885 1,097,630 11,939,788 United States securities 107,719 1,561,839 233,489 611, 895 83,437 114,451 310,616 89,096 116,370 312,463 152,159 135,268 3, 828,802 Municipal warrants 2,621 49 2,889 662 6 7,995 14,222 Transfers, net earnings 51,214 33,757 275,758 48,209 89.608 202,522 149,733 127,388 978,189 Commissions received 22,646 35,383 58,029 Deficient reserve penalties (including interest) 18,426 27,192 29,784 66,462 122,654 35,240 65,382 52,107 29,101 99,929 56,305 96,409 698,991 Net service charges received. 59,695 50,167 47,714 41,029 49,065 21,752 26,570 25,943 27,719 23,493 28,323 19,862 421,332 Profits realized on United States securities 41,821 167,239 11,139 51,820 294 272,313 Sundry profits 247, 805 502,189 49,286 22,744 59,836 13,524 50,214 17,240 27,706 12,453 21,747 4,154 1,028, 89S Total earnings. 4,475,195 II 25,314,736 ! 4,357,740 j 5,226,864 j 2,979,048 I 2,293,058 II 8,481, 2,676,828 I 2,049,954 j 3,451,936 2,089,526 J 4,187,785 j 07,584,417 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Earni7igs and expenses of each Federal Reserve Bank and of the system, as a tcholefor the calendar year 1918—Continued. CURRENT EXPENSES. 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 c r o a . n-| Expense of operation: Assessments account expenses, Fed eral Reserve Board $32,190 $100,876 $33,929 $43,073 $19, 814 $15,369 $49,378 $18,397 $14,117 $17,998 $15,223 $22,277 Federal Advisory Council (fees and traveling expenses) 475 1,650 372 781 150 455 582 1,034 270 3,043 Governors' conferences (including traveling expenses) 70 28 145 210 70 269 204 232 354 I Federal Reserve Agents' conferences ^ (including traveling expenses) 199 113 140 191 321 142 381 283 32S 422 601 Salaries— Bank officers 189,901 64,288 81,307 4.8,455 70,643 105,819 72,573 49,125 68,045 68,544 94,605 Clerical staff 264,942 1,082,719 283,624 297,579 173, US 121,938 405,610 206,763 123,402 188,680 170,134 287,608 I Special officers and watchmen 9,115 25,854 14,976 16,901 4, 868 5,280 32, 550 7,218 5,609 4,314 1,595 All other 9,049 5,008 3,060 11,958 5,212 120 784 5,464 1,117 Directors' fees 4,150 19,505 4,160 3,060 3,320 2,295 4,920 8,245 3,610 8,260 1,960 4,307 I Per diem allowance 1,220 60 670 1,060 680 2,548 740 1,750 850 3,675 995 1,480 Traveling expenses 938 1,262 1,120 1,709 1,218 2,689 1,941 2,317 1,562 6,553 1,487 Officers' and clerks' traveling expenses 4,337 4,519 2,463 15,513 3,015 3,007 5,536 3,309 1.982 2,426 7,757 14,193 Legal fees 2,600 3,017 1,570 2,000 1,122 3,495 3, 850 1,732 1,225 2,215 2,919 Rent 33,328 139,008 5,050 37,465 5,206 18,722 53,078 739 11,298 21,263 659 18,306 Taxes and fire insurance 25,035 2,423 1,939 1,823 3,276 513 167 169 1,211 7,768 Telephone 6,759 13,540 6,779 5,489 2,110 '766 6, 781 2,323 2,213 2,481 1,883 4,859 Telegraph 3,970 19,514 3,170 6,680 2,960 5,030 12,311 4,775 3,193 4,455 9,668 11,716 E Po x s p t r a e g s e s age 2 5 5 2 , , 0 9 7 5 0 4 9 47 9 , , 2 4 0 4 4 0 4 26 0 , , 9 2 5 8 1 3 5 5 4 , , 6 3 4 4 6 6 4 9 5 , ,5 7 1 6 9 7 2 5 8 , , 1 9 4 9 0 8 6 1 3 0 , , 7 2 7 3 4 1 3 25 4 , , 1 8 9 1 2 3 3 1 6 3 , , 0 5 3 0 9 1 60,9 4 7 6 4 6 2 2 4 8 , , 6 8 8 4 8 3 4 5 1 3 , , 8 8 1 8 3 8 Insurance and premiums on fidelity bonds 10,899 32,871 16,599 20,125 8,464 2,041 25,157 6,116 7,776 6,005 10,774 9,343 Light; heat, and power 5,116 6,997 4,801 2,551 6,648 762 4,899 2,523 2,413 2,960 Printing and stationery." 39,348 137,960 34,366 46,566 36,516 23,782 75,877 25,386 18,361 25,370 25,072 50,933 Repairs and alterations 2,687 42,146 2,565 15,430 12,275 133 20,261 5,092 2,016 5,020 14,742 All other expenses 89,735 176,198 45,588 49,135 15,680 56,282 179,972 15,692 16, 238 53,950 20,278 126,550 Total expense of operation 691,112 2,146,805 593,464 717,740 408,267 378,923 1,076,624 472,046 308,910 486,959 406,130 776,977 Cost of Federal Reserve currency, includ ing expressage, insurance, etc 167,828 335,044 243,857 182,092 118,822 149,390 388,682 147,347 114,287 98,542 82,730 238,746 I Miscellaneous charges account note issues.. 7,558 27,921 3,081 6,569 6,700 9,314 13,004 4,597 10,734 57,017 9,678 Furniture and equipment 41,622 170,933 215,043 85,784 91,786 89,846 172,365 102,031 30,477 46,710 "*4i,'758 45,169 Repairs, alterations, etc., to bank build ings 61,895 31,471 18,245 Total current expenses. 970,015 2,680, 703 1,086,916 992,185 643,820 627,473 1,650,675 726,021 464,408 689,228 535,424 1,070,570 I Net earnings for year 1918 ,505,180 122,634,033 " 270,824 4,234,679 (2,335,228 1,665,585 ", 831,072 1,950,807 1,585,546 [2,762,708 1,554,102 13,117,215 Per cent of average paid-in capital. 54.7 113.5 46.3 49.3 60.3 54.7 67.7 53.9 56.5 78.4 52.2 1 70.6 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 19IS—Continued. PROFIT AND LOSS ACCOUNT OF EACH FEDERAL RESERVE BANK AND OF THE SYSTEM AS A WHOLE FOR THE CALENDAR YEAR 1918. x. ,- , ! TMifladol-: Clpvrv- ! •Rich- ... ,M . T . I Minne- I Kansas I ^ -,, ;Sa,n Fran-' r,, , p'u i In i. | UK n 1 Earnings ... <U,17> FO ^ l i i H ^l >\740 <5 3 22bRM >2'>7Q,048 *2 ">' °^ ^ *s1 ?<7 ^<>7bS.s ^< t° °"4 ^3 * >1 ^3b <VV 0 ->2h *l 1S7 78" ^ 7 >M 1i7 Current expenses 07) 'in I > bS) ,o> 1 0v> <nb 092 185 6U S20 | '27 173 1 b>) b7 > | 72b 02i | 4M to-^ ( b«-9 „2^ | <FD 121 1 070 70 J2 -57 MS Net earnings for year i 1} > ISO 22 b 3 0 2 0 S24 1,^11 b79 U >) ^ l b, ,0 'b 8>1 072 il OiP S{ 7 1 >lo 2,« )-t 7N il, >i 10<i ,3,117 M5 \ o> Hb 979 Profit and loss account J ark 1, 1918 /> , MS I Jk 311 | I 2J(« D« | 29, 4(7 j 201 ->b J ,1 OM] 1 , >> 71 > Total. * /b ISO i 22 Ml f^j * 19i 0 2 4 >bb,990 2, > ,Z2* i >b> >s5 b 831 072 2 J*l 14> 1, >S > "db ^ 05b,D5 1 7 >J MS 3 iOyW | 5 i 69") b<M Less amounts charged against profit and I | | loss on account of: I j ! Bank premises 200,000 | 803,800 | 182,(504' 10,000 I 12,797 ! 100,000 61,736 I 238,600 1,609,537 Vaults „„ i ; ••• 29,500 j 11,000 40,500 Amounts reserved for depreciation ' i I i on United States bonds ! | 116,131 I 84,406 13,198 ; | 172,997 220,734 240,663 S48.129 Special reserves j 299,375 j ' 7,900 307,275 Miscellaneous debits during year j i l 132,059 ! ; 14,477 :m\''-2o]ML~\ """".'. 4,226 | 528 i 1,551 i 74,772 Total deductions 209,GOO | 971,116 | 298,735 | 98,883 23,198! 13,112 I 25,991 I 172,997 324,960 j 313,927 i 248,051 Net amount available for dividends, sur plus, and franchise taxes Dec. 31, 1918.. 3,305,180 121,662,917 13,192,327 14,268,107 2,312,030 ,1,652,473 6,805,081 12,008,148 1,545,847 2,731.155 1,445,911 12,945,849 53,875,025 Dividends paid 384, ISO I 1,195,026 583,983 ! 716,107 232,432 j 182,473 j '604,635 404,838 168,103 | 309,729 | 261,503 | 497,675 5,540,684 Profit and loss Dec. 31, 1918, after pay ment of dividends 2.921,000 120,467,891 2,608,344 3,552,000 2,079.598 1,470,000 16,200,446 1,603,310 ;1,377,744 '2,421,426 1,184,408 2,448,174 Distribution of profit and loss: Carri ed to surplus account 3,100,223 : 801,655 688,872 I 1,'21 0,713 592,204 1,224,087 21,605,901 Reserved for Government franchise tax 1,460,500 12,795,215 1,304,172 ,1,776,000 1,039,799 735,000 3,100,223 I S01,655 688,872 : 1,210,713 592,204 1,224,087 26,728,440 i Net credit. 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 v-holefor the calendar year 1918—Continued. FISCAL AGENT DEPARTMENT DISBURSEMENTS OF EACH FEDERAL RESERVE BANK, AMOUNTS REIMBURSED AND BALANCES REIMBURSABLE AT THE END OF THE CALENDAR YEAR 1918. Boston. Y N o e r w k . Ph p i h la i d a. e l 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. San Fran- Total. $1,143,633 $4,821,309 $1,074,146 $1,447,592 $446,770 $774,197 $2,415,011 $1,046,297 $421,013 $7S4,789 $596,108 $1,285,794 L$ 16,256,6S9 Amounts reimbursable Jan. 1, 1918... 143,211 360,350 100,033 139,248 43,221 48,135 287,428 | 124,849 54,127 86,450 65,005 247,604 1,699,661 Total 1,286,844 5, 181, 659 1,174,179 1,586,840 489,991 822,332 2,702,439 1,171,146 475,170 871.239 6il,113 1,533,393 17,958,350 729,235 2,132,129 415,420 820,055 263,916 363,683 1,440,554 720,804 324,958 420,019 151,973 599,963 8,382,709 Balance reimbursable Jan. 1, 1919.. 557,609 3,049,530 758,759 766,785 226,075 458,649 1,261,885 ! 450,342 150,212 451,220 933,435 9,573,641 i COST OF FURNITURE AND EQUIPMENT, INCLUDING VAULTS, ALSO BANK PREMISES. Balance as reported Jan. 1, 1918 $25,581 $9.065 $44,499 $29,501 $13,750 $11,000 $133,396 "$4l"622" "$170'933* 189,462 $85,7S4 82.721 "$89*840 "$172," 365*1 57,532 30,476 46, 710 41,753 $45,169 1,054,373 Total 41,622 170,933 215,043 85,784 91,786 89,846 172,365 102,031 59,977 60,460 52,753 45,169 1,187,774 Charged to current expense or profit and 41,622 170,933 215,043 85,784 91,786 89,S46 172,365 102,031 59,977 46,710 52,758 45,169 1,174,024 Amount recovered account previous ex ! | penditure for vault equipment 6,875 6,87. i Balance Jan. 1, 1919 ' i 6,875 Bank premises -. 800,000 2,317,692 500,000 290.000 217,000 400,000 221,000 400,000 8,081,841 COST OF UNISSUED FEDERAL RESERVE CURRENCY. $512 $58$ $16,167 $12,915 $10,161 $40,343 Additional cost during year 1918 \ $167,828 $335, 044 243,345 $182,092 $118,822 148,802 $388,682 1 131,180 101,372 | ""$98," 542" 72,569 $238,740 2,227,024 Total i 167,828 335,041 243,857 182,092 118,822 149,390 388,682 147,347 114,287 j 93,542 82,730 238,746 2.267,367 Cost of Federal Reserve notes charged to | current expenses during year 167,828 335,044 243,857 182,092 118,822 149,390 388,682 147,347 114,287 98,542 82,730 238,740 2,267,367 Balance Jan. 1. 1919... i - 1 i 1 1 1 1 Exclusive of $658 representing cost of Federal Reserve notes in transit to branches. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Earnings and current expenses, by months, for the calendar year 1918, of each Federal Reserve Bank and of the system as a -whole. EARNINGS. i Boston. New York, Ph p i h la i d a. e l Cleveland. 'Richmond. Atlanta. Chicago. St. Louis. M ap i o n l n is e . K C a i n ty s . a s Dallas, Sa c n i s F co ra . n Total. $229,863 $1,338,457 $191,710 $323,991 $161,076 $88,287 $435,984 $157,599 $87,962 $184,296 $109,953 $177,636 $3,486,814 February 320,216 1,324,642 175;229 268,970 141,842 80,665 380,723 126,773 82,443 143,098 92.314 219,174 3,3o6,0S9 March 276,920 1,866,517 209,376 281.121 152,822 98,726 366,369 133,235 79,780 148,032 107,067 255,202 3,975,167 April 274,298 1, 838,393 226,898 339', 897 195,000 120,035 510,314 189.521 109,530 245,115 135,677 233,689 4,418,367 May 263,715 1.949,912 256,525 330,207 226,812 123,881 544,357 180;044 138,007 287,308 153,537 258,778 4,713,083 June 323,463 l', 964,753 292,353 328,261 248,867 127,786 546', 379 206,413 158,683 292,166 146,696 264,850 4,900,670 July 455,418 1,828,034 331,912 510,415 265,603 154,957 818', 756 262,522 234,198 344,592 156,379 335,374 5,698,160 August 344,092 2,085,662 370,339 509,010 277,790 186,527 884,659 211.371 250,148 337,747 188,137 410,053 6,055,535 September 407,991 2,634,482 411,267 458, 327 278,659 247,396 938,386 249; 923 288,150 300,762 235, 610 465,024 6,915,977 October.... 512,690 2,825,751 509,593 553,835 302, 226 339,952 1,090,029 330.758 236,362 389,591 263,725 564,012 7,918,524 November 517,025 2,862.607 6)95; 778 608.936 364,219 356,150 979,099 320,691 182,225 407,645 234,711 482,721 8,011,807 December. 549^ 504 2, 795; 526 686,760 713,894 364,132 368,696 986,692 307,978 202,466 371,584 265,720 521,272 8,134,224 Total. 4,475,195 J 25,314,736 4,357,740 ; 5,226,864 j 2,979,048 2,293,058 8,481,747 2,676,828 2,049,954 3,451,936 2,089,526 4,187,785 67,584,417 1 1 CURRENT EXPENSES. Boston. New York. Ph p i h la i d a. e l Cleveland. Richmond. Atlanta. Chicago. St Louis. a M p i o n l n is e . K C a i n ty s . a s - j Dallas. San c is F c r o a . n Total. $33,030 $150,095 $30,962 SM,t»-s $21,523 $17,832 $51,281 $28,236 $21,829 $41,816 $19,517 $37,4o6 $517,205 February 38,017 154, 282 41,460 .9,MU> 28,292 16,821 54,167 28,301 19,596 40,698 •' 20,034 37,282 588,916 March 47,763 147, 036 42,992 «»,, 1 •.; 40,671 19,869 65,471 53,221 22,814 45.^11 : 22,725 46,458 631,141 April 89,754 141,295 38,567 7/ 96 *> 40,006 19,546 123,181 30.416 26,031 37,' 401 i 23;532 47,620 645,814 41,376 139.878 58,766 72,77^ 36,609 18,177 89, 769 ' 34,279 25,667 50,775 i 23,333 65,987 657,390 June 205, 851 154,477 266,542 T'./JV) 41,607 35,885 120,030 87,790 30,135 47, 107 I 29", 472 61,274 1,107,129 Julv 48,791 238, 062 43,954 M,615 41,048 26,891 129,409 47,710 31,326 60,99! ' 79,531 94,415 911,771 August 52,426 188,137 47. 058 '/ i, (ho 47,537 58,452 142, 255 56,453 41,607 5^034 41,599 86,319 891,956 September....... 65, 578 214,376 45,731 57,444 55,712 151,448 73,055 51,284 53,959 ; 49,545 70,394 951,947 October 97.061 271,419 60,441 71 iH) 46', 536 79,316 158,559 73, 854 88,697 57, 5H6 • 49,777 68,685 1,068,381 November. 62,302 312,784 57, 787 1 1, SM) 74, 886 64,802 152.427 52,752 36,039 65.542 : 42, 283 64,637 1,078,121 December... 288,066 568,867 852, 656 2U0.J7O 167,666 214', 170 417j 678 229, 954 119,383 129,865 134,076 390,013 3,168,164 Total cur rent ex penses.. . 970,015 2,680,703 1,086,916 992,185 643,820 627,473 1,650,675 726, 021 464; 408 689/228 ; 535,424 1,070,570 12,137,433 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

216 ANNUAL-REPORT-OF THE FEDERAL RESERVE BOARD. Exhibit I.—RECEIPTS AND DISBURSEMENTS OF THE FEDERAL RESERVE BOARD. There is here given a statement of receipts and expenditures of the Federal Reserve Board in 1918. The total expenses of the Board for the year are shown on the detailed statement of commitments to have been $427,696.89. RECEIPTS. Unexpended balance Jan. 1, 1918 $16, 504. 44 Assessments, 1918 382, 081. 31 Transfer from "Expenses, Trading With the Enemy Act," Federal Trade Commission 10, 000. 00 Transfer from "Expenses, Trading with the Enemy Act," Treasury De partment 2, 500. 00 Bulletin, subscriptions to ." 2, 049.14 Reimbursements 24, 207. 32 Miscellaneous 2,152. 26 Total available 439, 494.47 DISBURSEMENTS. By fiscal agent $395,018.39 Auditor's settlements 50, 678. 29 445, 696. 68 Deficiency 6, 202. 21 439, 494. 47 GENERAL STATEMENT. Total available 439, 494. 47 Balance to credit reimbursable account Jan. 3,1918 $500. 71 Reimbursements during 1918 24, 207. 32 — 24,708.03 Balance available for general expenses 414, 786. 44 Commitments, general expenses, 1918 $427, 696. 89 Commitments, 1917, paid in 1918 13,138. 80 Commitments, in excess of receipts 26, 049. 25 440, 835. 69 440, 835. 69 Commitments, in excess of receipts 26, 049. 25 Reimbursable expenditures. $27, 562. 86 Total in reimbursable account 24, 708. 03 Reimbursable expenditures in excess of receipts 2, 854. 83 Unpaid commitments 22, 701. 87 Deficiency 6, 202. 21 28,904.08 28.904.08 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Detailed statement of commitments. March. April. May. 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. Persona] services: Board and its clerks $7, 458.33 $7,338.33 b7.462.34 |$7,594.99 .$7,595.00 $7,559.01 $6,906.65 '$5,205.56 55.133.35 $5,288.70 S6.312.17 1^6,342.53 Secretary's office i 2,414.16 2,473.33 2,506.43 2,576.66 2,400.55 735.01 2,944. 3,208.13 3,431.01 3,415.82 3,371.01 3,566.67 Counsel's office | 1.093,74 2.982.50 2,082.51 2,082.49 2.082.50 2,082.51 2,102.49 1.594.17 1,510.84 1,510.83 1.455.83 1,500.84 Division of audit and examination j 2.720.00 2, (520.00 2.745.00 3.170.00 3,220.00 3,220.00 3,401.65 4,178.33 4,327.51 4,765.80 4,487.94 4.330.02 .Division of reports and statistics.. ! 1,(543.31 1,673.37 1. 714.46 1,853.58 1,979.16 2,360.31 3,427.21 3,684.17 3,715.04 3,675.23 3.737.89 3,728.54 Division of analysis and research.. I "416.67 893.32 1,042.78 1,341.89 Division of issue 1,062.49 | 1,062.50 | 1,062.52 '"995.83 1,120.00 1,180.84 1,352.49 1, 487.83 1,535.01 1,740.16 2,052.84 1,970.01 Messengers 500.00 • 558.50 570.00 555.66 570.00 570.00 654.99 644.33 60S.01 630.32 652.00 663.68 Charwomen 66.00 j 66.00 j 66.00 66.00 66.00 66.00 78.00 78.00 78.00 71.93 75.39 57.20 Total I7.S5S.03 [7,874.53 18,209.26 18,895.21 119,033.21 19.773.68 120,868.25 20,755.44 21,992.11 23,187.85 23,501.38 1242.029.47 Nonpersona] services: Transportation and subsistence— Board and its clerks 25,88 ; 143.77 355.90 j 40.99 j 377.81 12.91 67.00 18.41 99.82 1.142.49 Secretary's office 23. 81 31.70 91.25 36. 54 183.30 Division of audit and examinat ion 756.oo " 979." 7sYl," 579*20 'i 039.'69* |"p656*35"j "i,"669."29" 1,518.05 1,438.07 2,887.73 2.093.22 1,996.28 'i*52i."85" 18.476.06 Division of analysis and research 28. 32 186.70 25.62 41.37 69.39 '351.40 Division of reports and statistics 66.62 13.38 93.50 Counsel's office Messengers o.OO ! 5.00 1.70 i.00 31.70 Communication service: Telephone.. •. 278.09 221.03 229.04 j 166.99 173.21 151.53 j 154.09 157. 64 160.95 173.78 156.59 164.87 2.187.81 Telegraph 865.98 608.18 1,057.43 j 921.50 832.97 367.64 I 428.17 192.04 168.53 200.23 144.43 189.58 5,976.68 Postage 17.00 14.50 18.00 I 19.00 13. 00 81.50 Printing, binding, ct c 4,384.85 "i." 992 .'2.r,' 2,658.54 1 2,485.33 :, 746. 00 M34.19 ,471.95 2,259.36 :.395.81 3,202.82 2,003.(53 308. 61 29.043.34 ( E 'o le n c t t r r a i e c t i t r y e p (l a i i g rs h t ' .' a . nd power) ; 1so1.. 6o7o 30 8 . . 0 3 0 7 3 3 0 1 . . 0 0 0 0 I ! 3 4 0 . . 3 0 0 0 30 1 . . 2 0 0 0 30 6. . 5 0 0 0 j j 3 3 0 . . 0 2 0 0 3 1 0 3 . . 2 2 0 5 3 6 0 . . 3 2 0 0 3 2 0 7 . . 2 5 0 0 3 1 0 5 . . 2 8 0 5 30 1 . . 5 2 0 0 3 1 6 3 1 3 . . 2 4 0 4 Steam (heat) 25.00 25.00 25.00 j 25.00 25.00 25.00 25.00 175.00 Other nonpersonal services 216.47 274.73 143.04 ! 149.54 "251*141 ~603~26' 229.50 190.12 234.00 3,342.29 Supplies: Stationery 178.95 174.43 232.62 j 279.46 1.05 j 234.97 198.89 j 373.07 488.96 196. 54 122.67 2,829.75 Periodicals 19.50 87.10 12.25 ! 22. 00 26.80 ! 19.10 32.50 I 7.00 56.55 134. 75 11.00 428.55 Other 15.50 104.33 241.45 ! 28.87 94.55 254.72 i 27.09 567.02 j 15.53 53. 73 86.47 11.32 1,500.58 Equipment: Furniture and office equipment 694.98 486.89 282.33 ! 345.13 195.48 1,692.40 ! 234.36 835.38 I 1,530.53 1,380.74 297.69 477.05 8,452.96 Books 30. 00 332.20 13.20 I 3.15 5.00 3.75 : 12. .'0 t 1.50 14.38 2.50 418.18 Cold settlement fund (including salaries).. 607. 72 m. 68 713.04 610. 61 738.92 522.32 I 414.32 382.53 I 342.00 417. 70 "*373."98" 315.00 6.023.82 Foreign exchange (including salaries) 2,191.76 2,022.60 8,313.91 4,820.66 5.895.40 8,332.97 ; 10.204. 67 10.263.70 i 0.125.04 11,591.81 9.900.56 9,912.28 92,575.36 Capital issues (including salaries) 148.91 847. 63 1,433. 73 1, 663. 72 3,613.83 7,707.82 Rent 187. 93 437. 93 447. 93 447. 93 288. 81 119.07 I 119.07 119.07 I 225.74 569.07 594.07 594.07 4.150.69 Total . 10,721.74 1 9,218.13 17,595.48 43,414.28 17,337.55 15.299.18 |16,087. 98 |16. 737. 30 lix. 242.08 [20, 580. 81 14.109.09 185,667. 42 Grand total. . 28,579. 77 27,092. 66 35,804.74 32,309.49 36,370.76 42,572.92 39,511.65 J37,610.47 427,696.89 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

218 A^XUAL REPORT OF THE FEDERAL RESERVE BOARD. Exhibit J.—STATE BANKS AND TRUST COMPANIES ADMITTED TO MEMBERSHIP. The following is a list of the State banks and trust companies which have been admitted to membership in the Federal Reserve system up to and including December 31, 1918, showing the capital, surplus, and total resources as compiled from the latest available figures. Nine hundred and thirty-six State institutions are now members of the system, having a total capital of $348,649,871, total surplus of 1401,967,642, and total resources of $7,338,812,775. Total re Capital. Surplus. sources. DISTRICT NO. 1. CONNECTICUT. New Britain—New Britain Trust Co $400,000 $200,000 $5,503,209 New Haven—Union & New Haven Trust Co. 650,000 500.000 5,014,979 South Manchester—The Manchester Trust Co. 100,000 25,000 1,081,220 Waterbury—Colonia 1 Trust Co 400,000 500,000 0,493,973 MAINE. Bangor—Merrill Trust Co 300,000 400,000 5,349,090 Portland—Fidelity Trust Co 400,000 400,000 13,815,113 MASSACHUSETTS. Arlington—Menotomy Trust Co , 125,000 25,000 1,070,397 Boston— American Trust Co ,000,000 2,000,000 29, 886,924 Beacon Trust Co 600,000 1,000,000 20,124,465 Commonwealth Trust Co ,000,000 500,000 27,608,485 International Trust Co ,500,000 1,500,000 24,724,435 Liberty Trust Co 200,000 300,000 5,797,477 Metropolitan Trust Co 300,000 300,000 6,610,161 New England Trust Co , 000,000 2,000,000 27,633,904 Old Colony Trust Co 1,000,000 7,000,000 166,186,248 State Street Trust Co ,000,000 1,500,000 40,011,716 United States Trust Co ,000,000 1,000,000 10,684,141 Cambridge- Charles River Trust Co 200,000 200,000 3,920,225 Harvard Trust Co 200,000 100,000 4,845,949 Fitohburg— Fitchburg Bank & Trust Co 500,000 250,000 5,472,124 Holyoke—Hadley Falls Trust Co 500,000 250,000 6,706,573 Lawrence—Merchants Trust Co 300,000 150,000 7,046,040 Lynn—Security Trust Co 200,000 200,000 6,080,947 Newton—Newton Trust Co 400,000 400,000 6,129,387 Norwood—Norwood Trust Co 200,000 4,000 2,728,716 Salem—Naumkeag Trust Co 250,000 150,000 5,302; 517 Winchester—Winchester Trust Co 100,000 25,000 791,783 Worcester—Worcester Bank & Trust Co , 250,000 500,000 26,071,361 ' RHODE ISLAND. Providence— Industrial Trust Co I 3,000,000, 4,000,000 81,616,670 Rhode Island Hospital Trust Co 3,000,000 3,500,000 61,9281640 Union Trust Co 1,000,000 500,000 12,225, 726 Total 27,075,000 29,379,000 628,462,609 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

EXHIBIT "J ST ATI: BATNTV MEMBEBSHXP 219 Capital. Total i source JUSTRICT NO, 2, CONNECTICUT Bridgeport—Bridgeport Trust Co $500,000 $300,000 $0,844,282 South Norwalk—South Norwalk Trust Co 100,000 78,000 2,010,148 NEW JERSEY, Asbury Park—Seacoast Trust Co 100,000 75,000 1, )78, 780 Bayonne—Bavonne Trust Co 200,000 150,000 4,112/22 Bloomfield-—Bloomfield Trust Co 200,000 100,000 3,-*>N,597 Boonton—Farmers & Merchants Bank 75,000 25,000 490,297 Cranford—Cranford Trust Co 100,000 20,000 ! 1,487,335 East Orange—Savings Investment & Trust Co. of East Orange. 150,000 300 ^ 000 N, 2<>3,327 Glen Ridge—Glen Ridge Trust Co 100,000 20,000 1,17«>, 150 Hackensaek—Peoples Trust & Guaranty Co 500,000 250,000 »>, VM, 520 Hohoken—Jefferson Trust Co 200,000 50,000 \a0l, 502 Jersey City- Commercial Trust Co. of New Jersey 1,000.000 1,500,000 1 800 New Jersey Title Guarantee & Trust Co 1,000,000 1,000,000 15 703 Montelair— Bank of Montelair 100,000 R0,000 3 330,000 Montelair Trust Co 200,000 100,000 I \, 5v>,95t Morristown—Morristown Trust Co BOO,000 300,000 10,130,398 Newark—Federal Trust Co 1,000,000 500,000 10.21'), 9*0 Orange -Trust Company of Orange 100,000 30,980 1,0 V), 21^ Passaic— Peoples Bank & Trust Co 200,000 300,000 5 2Y* 027 Passaic Trust <fe Safe Deposit Co 200,000 100,000 7^ 852! 52*: Plainfield— Plainfield Trust Co 300,000 200,000 1O,0)M,07~* Rahway—Rahway Trust Co 100.000 25,000 V,5,5i) Rutherford—Rutherford Trust Co 100,000 25,000 l,35!-«, 537 Westfield— "Peoples Bank & Trust Co. of Westfield 100,000 80,000 2,010 300 Westfield Trust Co 10!), 000 20,000 1 2 JSJ.,',40 West Hoboken—Hudson Trusi Co 1,000'. 000 1,000,000 21 ^\041 NEW YORK. Amityvilie—Bank of Amity ville 25,000 .50,000 f-j7,'U: Amsterdam—Montgomery County Trust Co 200; 000 100,000 2, 7 Batavia—Bank of Genesee ". 100,000 100,000 ro,*)0' Bingha-mton—Peoples Trust Co. of Binghamton 500,000 100,000 13, 12b Brooklyn— ~ | Brooklyn Trust Co... i 1,500,000 2,518, n,2i5,r,8 M T Fr h a a e n n u P k f e l a i o n c p t l u T e r s r e u r T s s t r u T C s r o t u C st o C o , ! : 1 1 1 , , , 0 0 0 0 0 0 0 0 ' 0 , , , 0 0 0 0 0 0 0 0 0 1 1 , , 0 0 3 0 0 0 0 0 0 , , , 3 * 0, v 7 o u s , * o * l7 - Buffalo— i Buffalo Trast Co 500,000 500, 32, ,72,1)5 C C E E F G l a l h a l o m n o s a r t i v t C i a s h e r l A t i a r a e t P s — i m o u z v — a r e — i C r o l n k l F r h s S e — a i e — C — t r m a s F o t T t E u l e m o r S r n u r m i g B t e a s a t l e a t C C e r n C P c a o k B i a n o , u a r . a a l n C k l o n t T f h y k T B r a F r u T a t u u h n s r s t l k a u t t m s C o C t n , o o C N C o . o u Y n l.y : : : ! : | 1,2 6 2 1 5 5 5 2 0 0 0 0 0 0 5 0 0 0 , , , , , , , 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 1, 2 4 1 2 3 5 2 5 0 0 5 7 0 5 0 0 0 , , , , , , , 2 1 3 S 2 1 J 1 , . , , 2 V 5 " t 0 | W 1 < 5 5 . 2 I 0 0 H , 2 3 . , , \ , , , - ° ' 3 9 T , 1 H 2 U 2 O 0 H ^ > 0 ) 1 Hammonds port—Bank of Hammondspoi 1 50.000 50, 978, f>- Hicksville—Bank of Hicksviiie l 25,000 70, 9-18,2 5 Ithaca—Ithaca Trust Co j 200,000 100, 2,0>,2, CI Johnson City—Workers Trust Co I 100,000 25, 2, lb> **> Little Falls—Herkimer County Trust Co ! 350,000 3.50, 4, ro 0-; Millbrook—Bank of Millbrook" i 50, 000 50, *5? 7il Mineola—Nassau Coimty Trust Co ' 100,000 2,247, )2' New York- Bankers Trust Co 11,2.50,000 11,250,000 342,002 700 Bank of America 1,500,000 6,000,000 53,019, )> Central Union Trust Co 12,500,000 15,000,000 270,912 5v) Columbia Bank 1,000,000 500,000 17,osi,72) Columbia Tru4 Co 5,000,000 5,000,000 112, 77».,n)4 Commercial Exchange Bank 200,000 700, 000 7, 3)7, Us Commonwealth Bank 400,000 600,000 9,125,8*;) Continental Bank 1,000,000 500,000 14,725.138 Corn Exchange Bank 3,500,000 0, 500,000 1*7 398, 608 Equitable Trust Co. of New York (1,000,000 10,500,000 201,900,0'r, Farmers Loan & Trust Co 5,000,000 10.000, 000 210, !7i,500 Fidelity Trust Co 1,000,000 1,000,000 ll,3N3,On Fifth Avenue Bank of New York 200, 000 2,000, 000 25 430,95. Fulton Trust Co 500,000 250,000 ?>, 817,1^ Guaranty Trust Co. of New Yor k 25, 000, 000 25,000, 000 600,70o, >j.) Irving Trust Co 1,500.000 750,000 52,30! ,02, Lincoln Trust Co 1,000,000 500,000 22,0)8,81 ) Manhattan Co 2,500,000 6, 000, 000 125, "39, "8. Digitized for FR M A e S rc E an R ti le Trust & Deposit Co 1,000,000 500,000 17, '!> 7H} http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

220 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. Capital. Surplus. Total re sources. DISTRICT NO. 2—Continued. NEW YORK—continued. New York—Continued. Metropolitan Bank 000.000 $1,000,000 $44,677/887 Metropolitan Trust Co 000,000 4,000,000 51,414,450 Mutual Bank 200,000 400,000 10,315,815 New Netheiiand Bank of New York 200,000 200,000 5,894,857 New York Trust Co 000,000 10,000,000 112,494,281 Pacific Bank 500,000 800,000 21,636,890 Scandinavian Trust Co 000,000 1,500,000 33,691,285 United States Trust Co. of New York 000,000 12,000,000 53,324,391 United States Mortgage & Trust Co 000,000 4:000,000 83,694,904 W. B. Grace & Co.'s Bank 500,000 600,000 7,109,146 Yorkville Bank 200,000 400,000 9,708,828 Niagara Falls—Power City Bank 300,000 300,000 7,279,825 Nyack—Rockland County Trust Co 100,000 25,000 1,876,195 Ogdeusburg—St. Lawrence Trust Co , 100,000 25,000 1,249,467 Oneida—Madison County Trust & Deposit Co 182,200 107, 540 3,158,406 Oyster Bay—Oyster Bay Bank 50,000 50,000 1,332,624 Perry—Citizens' Bank of Perry, N. Y , 50,000 50,000 1,284,918 Port"Chcstcr—Mutual Trust Co. of "Westchester County., 300,000 60,000 2,140,479 Rochester—Alliance Bank , 500,000 500,000 15,803,732 Rome—Rome Trust Co 300,000 60,000 3,277,875 Schenectady—Schenectady Trust Co 300,000 62,500 6,486,682 Stony Brook—Bank of Suffolk County 25,000 15,000 390,553 Syracuse- City Bank 734,073 265,036 10,071,953 Syracuse Trust Co 500,000 500,000 17,821,127 Trust & Deposit Co. of Onondaga ,000,000 450,000 24,372,125 Trumansburg—State Bank of Truman sburg 25,000 15,000 335,318 Utica— Citizens Trust Co. of Utica . 500,000 400,000 13,962,645 Oneida County Trust Co 250,000 250', 000 3,498,458 Utica Trust & Deposit Co 600,000 400,000 17,972,908 Warsaw—Trust Co. of Wyoming County 100,000 20,000 800,731 Watertown—Northern New York Trust Co 400,000 400,000 10,478,108 Westbury—Bank of West bur v 25,000 5,000 487, 615 White Plains—County Trust Co 100,000 50,000 2,986,852 Total. 117,391,273 3,366,784,468 DISTRICT NO. 3. DELAWARE. Wilmington— Equitable Trust Co 500,000 500,000 6,130,532 Security Trust & Safe Deposit Co 600,000 700,000 6,630,074 Wilmington Trust Co 1,000,000 500,000 18,433,791 NEW JERSEY. Camden—Camden Safe Deposit & Trust Co. 500,000 800,000 11., 122,691 Gloucester City—Gloucester City Trust Co... 100,000 25,000 »928,316 Princeton—Princeton Bank & Trust Co 100,000 150,000 2,020,327 Riverside—Riverside Trust Co 100,000 100,000 Swedesboro—Swedcsboro Trust Co IOO; ooo 724,576 PENNSYLVANIA. Chester—Cambridge Trust Co 250,000 125,000 5,650,476 Harrisburg—Dauphin Deposit Trust Co 300,000 300,000 4,812,171 Haz-leton—Markle Banking & Trust Co ' 100,000 500,000 4,359,984 Honesdale—Wayne County Savings Bank 200,000 325,000 3,543,460 Lykens—Miners Deposit Bank 50,000 110,000 728,455 Philadelphia- Bank of Commerce 300,000 140,000 2,419,583 Colonial Trust Co 272,725 272,725 4,874,703 Commercial Trust Co 1,000,000 1,750,000 23,173,337 Drovers & Merchants Bank 200,000 40,000 1,165,617 Fidelity Trust Co 5,000,000 16,000,000 62,512;027 Girard Trust Co 2,500,000 7,500,000 59,007,703 Logan Trust Co. of Philadelphia. 1,000,000 250,000 11,022,856 Pennsylvania Co. for Insurance on Lives and Granting Annuities 2,000,000 5,000,000 37,352,572 Philadelphia Trust Co 1,000,000 4,000,000 31,197,336 Provident Life & Trust Co 2,000,000 5,000,000 1 17,937,572 Rittenhouse Trust Co 250,000 50,000 2,583,468 West Philadelphia Title & Trust Co , 500,000 500,000 7,018,684 Scranton—American Bank of Commerce 312,987 34,480 843,294 Wilkes-Barre—Dime Deposit Bank 200,000 150,000 2,156,994 Williamsport— Northern Central Trust Co 500,000 150,000 3,687,086 Susquehanna Trust & Safe Deposit Co 400,000 300,000 2,984,904 Wiiliamstown—Williams Valley Bank 50,000 45,000 469,290 Total ! 21,385,712 45,237,205 339,571,901 1 Exclusive of insurance assets of $96,019,988. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

EXHIBIT -STATE BANK MEMBERSHIP, 221 Capital, Surplus. Total re sources. DTSTRTCT ISO. 4. KENTUCKY. Brooksville—Farmers Equity Bank £25,000 £12,500 $299,972 Independence—Bank of independence . 40,000 8,000 277,708 Lexington— Security Trust Co 500,000 150,000 2,222,031 Title Guaranty & Trust Co 150,000 15,000 985,234 Maysville—First Standard Bank <fc Trust Co 175,000 75,000 1,599,310 Mount Sterling—Exchange Bank of Kentucky 50,000 35,000 '418,050 itichmond—State Bank & Trust Co 150.000 50,000 1,149,441 OHIO. Akron- Central Savings & Trust Co 500,000 500,000 10,129,377 Depositors Savings & Trust Co 300,000 250,000 5,678,394 Peoples Savings & Trust Co 200,000 100,000 4,963,506 Alliance- City Savings Bank & Trust Co 100,000 100,000 2,646,356 Alliance Bank Co 150,000 120,000 3,249,412 Barbcrton—Peoples Savings <fc Banking Co 100,000 20,000 1,337,976 Buckeye City—Commercial & Savings Bank Co 25,000 2,750 258,483 Canton—Dime Savings Bank Co 200,000 120,000 3,994,897 Chagrin Falls—Chagrin Fails Banking Co. 50,000 45,000 891,372 Cincinnati- Brighton Bank & Trust Co., 200,000 200,000 5,718,144 Provident Savings Bank & Trust Co 1,400,000 1,000,000 14,026,373 Union Savings Bank '& Trust Co 1,000,000 2,000,000 20,323,834 Western Bank & Trust Co 500,000 500,000 11,443,095 Cleveland*— Citizen Savings & Trust Co 4,000,000 4,000,000 64,441,232 Cleveland Trust Co 2,500,000 2,500,000 61,738,413 Guardian Savings & Trust Co 3,000,000 3,030,000 56,601,412 Superior Savings & Trust Co 500,000 1,000,000 16,507,570 United Banking & Savings Co 1,000,000 400,000 13,636,312 Columbus—Citizens Trust & Savings Bank 700,000 150,000 6,198,450 Cuyahoga Falls— The Citizens Bank 50,000 3,000 351,494 Cuyahoga Falls Savings Bank Co 100,000 31,000 1,163,346 Dayton—Dayton Savings & Trust Co 500,000 420,000 10,426,874 Geneva—Gcneva Savings Bank Co 100,000 68,000 1,018,990 Oibsonburg—Gibsonburg Banking Co 50,000 17,500 732,743 — Home Banking Co 25, W0 9,000 638,009 Hillsboro—Hillsboro Bank & Savings Co 50,000 15,000 564,770 Lodi—Lodi State Bank 40, 000 60,000 625,130 Mssillon—Ohio Banking & Trust Co 150,000 37,500 1,640,731 Milan—Farmers & Citizens Banking Co. 25, 000 8,000 421,886 Minerva—Minerva Savings & Trust Co 50,000 40,000 1,368,347 Minster—Minster State Bank 25,000 20,000 341,468 Newark—Newark Trust Co 200,000 125,000 2,430,646 Peninsula—Peninsula Banking Co 25,000 4,000 230,181 Kossford—Rossford Savings Bank.. 50,000 183,802 St. Marys—Home Banking Co 100,000 20, 000 924,620 Sneneer—Spencer State Bank 25, 000 150, 739 Steubenville—Steubefmlle Bank & Trust Co 125. 000 "*5o."666' 1,953,004 Struthers—Struthers Savings & Banking Co 50;ooo 50,000 1,830,278 Toledo- Commercial Savings Bank & Trust Co 200,000 60,000 5,328,534 Guardian Trust & Savings Bank of Toledo I 200,000 200,000 4,146,437 Vermilion—Krie County Banking Co I 50, 000 10,000 479,254 Wellington—First Wellington Bank 85,000 75,000 1,178,192 West Lafayette—West Lafayette Bank Co ! 100,000 50,000 1,063,170 West Milton—Citizens State Bank j 30,000 5,000 294,138 Youngstown: Dollar Savings <fc Trust Co 1,500,000 500,000 20,323,625 City Trust <t Savings Bank ' 200,000 150,000 5,378,291 PENNSYLVANIA. Ambridge— Ambridge Savings & Trust Co 125,000 50,000 1,793,493 Beaver—Beaver Trust Co 300,000 100,000 1,418,283 Beaver Falls—Federal Title & Trust Co. of Beaver Falls.. 200,000 40,000 1,303,191 Bellevue— Bellevue Realty Savings & Trust Co 125, 000 50,000 995,119 Erie—Security Savings & Trust Co 200,000 300,000 4,523,543 Meadville—Crawford County Trust Co 125,000 15,000 1.607,373 New Castle—Lawrence Savings & Trust Co 300,000 300,000 3,677,270 Pittsburgh- Allegheny Trust Co 700,000 500,000 4,740,929 Colonial Trust Co 2,600,000 2,600,000 22,301,879 Commonwealth Trust Co. of Pittsburgh 1,500,003 1,000,000 11,480,345 Oakland Savings <fc Trust Co 200,000 200,000 3,693,991 Pittsburgh Trust Co 2,000.000 1,000,000 21,075,312 Union Truet Co. of Pittsburgh. , 1,500' 003 34,500,000 130, 769,630 Woodlawn—Woodlawn Trust Co 125; 000 62,500 1,847,504 Total. | 31,620,000 59,098,750 585,590,840 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

222 AlsTXTTAL REPORT Or THE FEDERAL EESERVE BOAED. Capital. Surplus, Total re sources. DISTRICT NO. .C>. DISTRICT OF COLUMBIA. Washington—Continental Trust Co $1,000,000 .1100,000 $5,142,440 MARYLAND. Baltimore* The American Bank 300,000 100,000 3,049,171 Baltimore Commercial Bank 500,000 100,000 4,218,607 Baltimore Trust Co 1,000,000 2,000,000 16, 443,811 Maryland Trust Co 1,000,000 8,135,725 Gwyrm Oak Junction—Liberty Bank of Baltimore County 25,000 5,030 327,535 Hamilton—Hamilton Bank...". .*. 30,000 10,0*30 354,275 NORTH CAROLINA. Asheville—Battery Park Bank 100,000 100,000 3,201,165 Charlotte—American Trust Co 525,000 375,000 5,876,808 High Point—Bank of Commerce 100,000 12,000 789,578 New Bern—New Born Banking & Trrfst Co 100,000 925,700 Winston-Salem—Wachovia Bank & Trust Co 1,250,000 750,000 22,545,766 SOUTH CAROLINA. Charleston—Carolina Savings Bank 200.000 100,000 3,189,556 Cheraw—Bank of Cheraw no; ooo 50,000 721,778 Cheraw—Merchants & Farmers Bank 6,000 481,542 Chester—Commercial Bank 100,000 65,000 988,180 Darlington—Bank of Darlington 100,000 50,000 1,135,791 Florence—Commercial and Savings Bank. 100,000 25,000 * 780,629 Georgetown: 125,000 Bank of Georgetown 100,000 100,000 940,323 Peoples Bank 78,800 26,140 511,880 Har tsville—Bank of Hartsville 75,000 35,000 712,338 Sumter—Peoples Bank 100,000 21,000 674,886 Union—Nicholson Bank & Trust Co 75,000 25,000 801,540 Westminster—Westminster Bank 100,000 25,000 707,104 Woodruff—Bank of Woodruff 40,700 10,500 390,204 VIRGINIA. Cambria—Cambria Bank (Inc.) 28,000 5,000 228,331 Chase City—Peoples Bank & Trust Co. of Chase City 100,000 11,000 319,560 Christiansburg—Bank of Christiansburg * 34,000 100,000 1,145,082 EmpDria—Greensville Bank • 50,000 60,000 590,841 Harrisonburg—Peoples Bank of Harrisonburg (Inc.) 150,000 20,000 798,788 Norfolk: Citizens Bank of Norfolk 600,000 500,000 7,024,199 Marine Bank of Norfolk 220,000 110,000 2,097,194 Richmond: Savings Bank of Richmond 200,000 200,000 2,112,894 Union Bank 219,750 300,000 2,951,548 WEST VIRGINIA. Charleston—Kanawha Valley Bank 400,000 1,000,000 7,321,355 Franklin—Franklin Bank 40,000 7,500 254,219 Grafton—Grafton Banking & Trust Co 100,000 30,000 1,093,407 Total ,376,250 6,459,140 108,983,839 DISTRICT NO. 6. ALABAMA. A B t i h rm en i s n — gh C a i m ti : z ens Bank & Trust Co 30,000 18,000 371; 194 American Trust & Savings Bank 500,000 250,000 8,186,511 Birmingham Trust & Savings Co 500,000 650,000 13,272,696 Center—Cherokee County Bank 25,000 222,943 Cullman—Alabama Bank & Trust Co 50,000 50,000 Eufaula—Bank of Eufaula 100,000 14,000 505,135 Marion—Marion Central Bank 50,000 100,000 582,325 Mobile— Merchants Bank 200,000 200,000 5,242,255 Peoples Bank of Mobile 200,000 200,000 5,589,593 Montgomery—Sullivan Bank & Trust Co 100,000 10,000 464,441 Union Springs—American Bank 50,003 5,000 276, 791 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

EXHIBIT J STATE BA^K MEMBERSHIP. j Total re- Capital. Surplus. DISTRICT NO. G—Continued., FLORIDA. Deland—Volusia County Bank $101,000 $100,000 SI,107,886 Jacksonville—American Trust Co 200,000 16,000 845,307 Leesburg—Leesburg State Bank 30,000 10,000 324,571 Miami—Southern Bank & Trust Co. 100,000 596,856 Plant City—Hillsboro State Bank... 50,000 50,000 555,924 Tallahassee—Exchange Bank 50,000 3,000 267,987 Tampa—Citizens Bank & Trust Co.. 250,000 SCO, 000 4,854,300 Winter Park—Union State Bank 30,000 106,543 Athens—American State Bank 100,000 20,000 522,012 Atlanta- Central Bank & Trust Corporation ,000,000 300,000 10,898,200 Georgia Savings Bank & Trust Co 200,000 100,000 1,559,160 Trust Co. of Georgia , 000,000 1,000,000 4,162,624 Brunswick—Brunswick Bank & Trust Co. 100,000 80,000 1,339,793 Camilla—Bank of Camilla 50,000 50,000 493,476 Commerce—Northeastern Banking Co 100,000 35,000 787,068 Hartwell—Hartwell Bank 60,000 20,000 386,758 Jackson—Jackson Banking Co 50,000 10,000 293,623 Louisville—Bank of Louisville.. 25,00o 6,000 356,142 Metter—Citizens Bank 30,000 15,000 241,862 Sardis—Peoples Bank 23,000 6,000 142,212 Savannah- American Bank & Trust Co 200,000 10,000 888,965 Citizens & Southern Bank ,WO,090 1,000,000 24,567,163 Savannah Bank & Trust Co 700.00n 630,000 7,985,409 West Point—Citizens Bank 50,000 1,000 340,655 Winder—Farmers Bank 50, •») 291,257 Winterville— Pittard Banking Co 25,0-Vj 142,054 LOUISIANA. Baton Rouge—Union Bank & Trust Co t 25°' (V?5 Gretna—Jefferson Trust & Savings Bank 5t),0:,-0 ~'589*614 Iota—Bank of Iota 25,0>>O 5,000 243,009 New Orleans- American Bank & Trust Co 2oo,ooo 20,000 469,268 Cinal Bank & Trust Co :,ix,o,o*:o 500,000 33,335,620 Citizens' Bank & Trust Co. of Louisiana 400,ooo 150,000 7,219,708 City Bank & Trust Co 2(0 000 100,000 5,857,765 Commercial Trust & Savings Bank ,250,(>)i) 800,000 21,396,611 Hibernia Bank & Trust Co ,500,000 2,000,000 37,408,84.1 Interstate Trust & Banking Co 7)0,000 500,000 10,787,127 Liberty Bank & Trust Co 2OO.000 10,000 380,512 Marine Bank & Trust Co -<''}'>, 000 100,000 7,666,909 Metropolitan Bank l-)O,<y>0 200,000 5..08L177 New Loads—Pointe Coupee Trust & Savings Bank 6 V*>9 '145,547 MISSISSIPPI. Laurel—Commercial Bank & Trust Co. 100,000 25,009 ,362,778 Summit—Union Bank of Pike 25,000 5,000 'I95r183 TENNESSEE. Chattanooga—Savings Bank 750,000 225,000 5,805,014 Total "40,000 10,056,760 238,500,448 DISTRICT NO. ] ILLINOIS. Auburn—Auburn State Bank 25,000 25, 515,013 Barrington—First State Bank of Barrington... 50,000 10, 3*8,944 Bloomington—State Bank of Bloomington 100.000 150, , t;70, (37 Charleston—Charleston Trust & Savings Bank. 80,000 12, ' 788,183 Chicago- Austin State Bank 200,000 05, .,10G,5,;9 Capital State Savings Bank 200,000 20, , 199,978 Central Trust Co. of Illinois ,000, 000 1,000, ,713,418 Chicago Savings Bank & Trust Co , 000, 000 200, ,517,384 Depositors State & Savings Bank 300, 000 ,518,106 First Trust & Savings Bank , 000, 000 5, sob; :, 236, 400 Foreman Bros. Banking Co ', 500, 000 ' 500, . 282,256 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

224 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. Capital, Surplus. T so o u ta r l c e re s. DISTRICT NO. 7—Continued. ILLINOIS—continued. Chicago—C ontinued. Illinois Trust & Savings Bank '., 000,00'0$ 11,000,000 $118,248,231 kaspar State Bank 500,000 303,000 6,922,574 Madison & Kedzie State Bank 200,000 50,000 2,166,710 Mechanics & Traders State Bank 200,000 50,000 2,114,550 Mercantile Trust & Savings Bank 250,000 50,000 4,333,545 Merchants Loan <fe Trust Co ,000,000 9,000,000 120,103,999 Noel State Bank 300,000 100,000 3,271,125 Northern Trust Co !, 000,000 2,000,000 37,328,351 North Side State Savings Bank 200,000 10,000 1,699,026 North-Western Trust & Savings Bank 500,000 250,000 8,921,317 Security Bank of Chicago 400,000 250,000 6,313,544 Standard Trust & Savings Bank ,000,000 500,000 11,862,473 State Bank of Chicago ,500,000 3,000,000 39,822,842 Union Trust Co ,500,000 1,800,000 37,014,223 United States Bank of Chicago 200,000 30,000 996,086 Cicero—Kirchman State Bank ioo;ooo 25,000 716,439 Des Plains—Des Plaines Bank 50,000 33,000 630,358 Elmhurst—-Elmhurst State Bank 00,000 25,000 711,249 Eureka—Farmers State Bank of Eureka 100,000 632,624 E vans ton— Evanston Trust & Savings Bank 100,000 10,000 874,474 State Bank of Evanston 150,000 250,000 4,234,679 Geneva—State Bank of Geneva 50,000 6,000 557,971 Joliet— Commercial Trust & Savings Bank of Joliet.. 100,000 5,000 966,743 Joliet Trust & Savings Bank 100,000 25,000 967,704 Hinsdale—Hinsdale State Bank 50,000 25,000 628,496 Kewanee—Union State Savings Bank & Trust Co 150,000 25,000 1,310,007 La Grange—La Grange State Bank 50,000 25,000 1,090,337 Magnolia—First State Bank of Magnolia 25,000 5,000 203,462 Marshall—Marshall State Bank CO,000 5,000 234,986 Martinsville—Martinsville State Bank 50,000 20,000 358,664 Matteson—First State Bank of Matteson 25,000 10,000 139,490 Mattoon—Central Illinois Trust & Savings Bank. 100,000 50,000 947,232 Moline— Moline Trust & Savings Bank 225,000 85,000 3,604,917 Peoples Savings Bank & Trust Co 250, 000 150,000 5,696,949 State Savings Bank & Trust Co 300,000 125,000 4,248,387 Mount Carroll—Carroll County State Bank 50,000 35,000 917,026 Oak Park- Oak Park Trust & Savings Bank 200,000 50,000 3,013,155 Suburban Trust & Savings Bank 100,000 10,000 476,839 Oswego—Oswego State Bank 50,000 5,000 383,095 Shannon—State Bank of Shannon 25,000 15,000 268,186 St. Charles—Stewart State Bank 100,000 40,000 888 556 Sycamore—Pierce Trust <fe Savings Bank 100,000 50,000 787,856 Wenona—First State Bank of Wcnona 50,000 35,000 548,667 INDIANA. Angola—Steuben County State Bank 40,000 9,340 217,936 Bargersville—Farmers State Bank 25;000 11,000 305,091 Connersville—Farmers and Merchants' Trust Co.. 100,000 50,000 1,335,303 Cromwell—Sparta State Bank 27,500 116,211 Elkhart—St. Joseph Valley Bank 100,000 50,000 2,930,345 Hillsboro—Hillsboro State Bank 25,000 6,000 233,620 Jamestown—Citizens State Bank 30,000 7,500 418,472 Kentland— Discount & Deposit State Bank 70,000 40,000 600,735 Kent State Bank 50,000 32,000 418,220 Marion—Grant Trust & Savings Co 100,000 100,000 1,982,240 North Liberty—North Liberty State Bank 25,000 10,000 353,776 Peru—Peru Trust Co 100,000 25,000 1,153,268 Richmond—Dickinson Trust Co 200,000 125,000 2,400,970 South Bend- American Trust Co 200,000 128,000 2,991,383 St. Joseph Loan & Trust Co 200,000 100,000 3,581,531 South Whitley—Gandy State Bank 25,000 10,500 359,568 Terre Haute—Terre Haute Trust Co 350,000 200, 000 5,482,236 Tipton—Farmers Loan & Trust Co 50.000 45,000 723,936 Winamac—First Trust & Savings Bank 40', 000 163,264 IOWA. Algona—County Savings Bank 100,000 25,000 1,704,068 A It a Vista—Alta Vista Savings Bank 30,000 10,000 392,267 Ames—Story County Trust <fe Savings Bank 50,000 12,500 489,796 Avoca—Avoca State Bank 50,000 20,000 788,350 Audubon—Iowa Savings Bank 50,000 179,232 Baines City—Farmers Savings Bank 25,000 8,000 433,491 Battle Creek—Battle Creek Savings Bank 40,000 45,000 847,619 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

EXHIBIT J STATE BANK MEMBERSHIP. 225 Capital. Surplus. Total re sources. DISTRICT NO. 7—Continued. IOWA—Continued. Bellevue—Bellevue State Bank $30,000 $10,000 $745,134 Blairsburg—State Bank of Blairsburg 25,000 5,000 309,997 Brighton—Brighton State Bank 50,000 25,000 600,080 Britt—Commercial State Bank 60,000 50,000 1,010,832 Cedar Falls- Security Trust & Savings Bank 50,000 8,000 331,839 Iowa State Savings Bank 100,000 25,000 2,058,658 Chariton—State Savings Bank 50,000 40,000 817,370 Charter Oak—Farmers State Bank 40,000 8,000 488,458 Cherokee—Cherokee State Bank 75,000 75,000 1,208,842 Clinton—Peoples Trust & Savings Bank 300,000 300,000 4,767,623 College Springs—Farquhar Savings Bank 25,000 40,000 373,627 Davenport—American Commercial Savings Bank. 600,000 600,000 14,436,251 Decorah— Citizens Savings Bank 50,000 50,000 589,018 Winnesheik County State Bank 150,000 50,000 1,889,640 Des Moines— Bankers Trust Co 1,000,000 100,000 3,173,736 Central State Bank 250,000 250,000 5,262,135 Iowa Loan & Trust Co 500,000 250,000 8,585,663 Elberon—Farmers State Bank 40,000 20,000 566,600 Eldora—Citizens Savings Bank 50,000 15,000 253,505 Elkader—Elkader State Bank 50,000 15,000 917,040 Ellsworth- Farmers State Bank of Ellsworth 25,000 198,567 State Bank of Ellsworth 35,000 10,000 255,696 Fairbank—Fairbank State Bank 26,000 14,000 460,027 Fairfield—Iowa State Savings Bank 100,000 100,000 1,592,031 Fostoria—Citizens Savings Bank 25,000 2,500 156,278 Garwin—Garwin State Bank 50,000 25,000 522,431 Germania—Farmers & Drovers State Bank 30,000 6,000 251,253 Gilbert—Gilbert Savings Bank 25,000 5,000 245,624 Oilman—Citizens Savings Bank 25,000 13,000 426,515 Humboldt—Peoples State Bank 100,000 35,000 857,932 Jefferson—Jefferson Savings Bank 50,000 5,000 509,227 Kellerton—Kellerton State Bank , 25,000 8,750 305,048 Knoxville—Guaranty State Bank 50,000 9,000 382,423 Leon—Farmers & Traders State Bank 100,000 5,000 846,252 Lockridge—Lockridge Savings Bank 25,000 10,000 356, 774 Logan—State Saving^ Bank 50,000 10,000 518,069 Lowden—Lowden Savings Bank 25,000 12,000 405,307 Malcolm—Malcolm Savings Bank 50,000 25,000 511,661 Mapleton—Mapleton Trust & Savings Bank 75,000 7,000 683,990 MarshaUtown—Marshalltown State Bank 100,000 30,000 2,252,845 Mason City—Commercial Savings Bank 100,000 20,000 1,236,314 Mediapolis—Commercial State Bank 50,000 12,500 610,731 Missouri Valley—State Sayings Bank 50,000 10,000 517,287 Mondamin—Mondamin Savings Bank 35,000 5,350 290,666 Monticello— Lovell State Bank 200,000 100,000 1,170,944 Monticello State Bank 200,000 200,000 2,349,329 Mount Ayr—Mount Ayr State Bank 100,000 15,000 701,925 New Hampton—State Bank of New Hampton— 50,000 40,000 649,252 Newton— Citizens State Bank 60,000 12,000 485,129 Jasper County Savings Bank 100,000 50,000 1,207,921 Ogden—City State Bank 50,000 5,000 507,383 Osage—Home Trust & Savings Bank 50,000 25,000 496,694 Ottumwa—Ottumwa Savings Bank 100,000 30,000 1,405,231 Perry—Peoples Trust & Savings Bank 50,000 750 330, 608 Remsen—Farmers Savings Bank 50,000 10,000 449, 995 Riceville—Riceville State Bank 25,000 10,000 216, 766 Roland—Farmers Savings Bank 35,000 10,000 427,163 Royal—Home State Bank 25,000 1,500 188,019 Sac City— Farmers Savings Bank 50,000 20,000 541,028 Sac County State Bank 75,000 75,000 1,199,472 Sioux City—Bankers Loan & Trust Co 100,000 8,000 538,204 Sioux Center—Sioux Center State Bank 25,000 5,000 259,446 Sutherland—First Savings Bank 50,000 2,000 347,626 Terril—Terril Savings Bank 25,000 1,000 138,734 Thompson—State Bank of Thompson 30,000 8,000 277,803 Tipton—Farmers & Merchants Savings Bank 50, 000 15,000 587,677 Ute—State Savings Bank 50,000 15,000 341,594 Vail—Farmers State Bank 50,000 8,000 389,078 Wapeilo—Wapello State Savings Bank 30,000 8,000 491,984 Waterloo—Waterloo Bank & Trust Co 200,000 50, 000 1, 591,951 100823°—19 15 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

226 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. Surplus. Total re sources. DISTRICT NO. 7—Continued. MICHIGAN. Adrian— Adrain State Savings Bank $120,000 $80,000 $1,960,051 Commercial Savings Bank., 110,000 30,000 1,209,968 Lenawee County Savings Bank 150,000 50,000 2,166,635 Albion— Albion State Bank 50,000 40,000 786,491 Commercial* Savings Bank 75,000 40,000 861,368 Alpena—Alpena County Savings Bank 100,000 125,000 3,257,554 Ann Arbor— F arm er s & M echani cs B ank 150,000 75,000 2,140,795 State Savings Bank ,. 150,000 150,000 2,895,502 Armada—Farmers State Bank 25/000 7,500 303,796 Bay City- Bay City Bank 250,000 250,000 4,515,837 Farmers State Savings Bank 100,000 25,000 1,191,804 Peoples Commercial <fe Savings Bank 400,000 400,000 7,834,221 Benton Harbor—Benton Harbor State Bank 100,000 27,000 1,253,213 Big Rapids- Big Rapids Savings Bank 50,000 10,000 657,054 Citizens State Bank 50,000 25,000 1,050,228 Carson City—Farmers & Merchants State Bank. 25,000 5,000 342,515 Cassopolis—Cass County State Bank 40,000 2,000 229,713 Charlotte—Eaton County Savings Bank 100,000 20,000 1,061,804 Chelsea—Farmers & Merchants Bank 25,000 25,000 561,132 Coloma—State Bank of Coloma 25,000 10,000 462,802 Coopersville—Peoples Savings Bank 25,000 1,000 240,231 Davison—Davison State Bank 25,000 6,000 512,086 Dearborn—Dearborn State Bank 100,000 125,000 4,828,498 Detroit- American State Bank 500,000 191,000 8,572,586 Bank of Detroit 500,000 100,000 12,478,634 Detroit Savings Bank 750,000 750,000 20,187,043 Central Savings Bank ][. 500,000 100,000 13,068,307 Dime Savings Bank 1,000,000 1.100,000 34,880,114 First State Bank of Detroit 500,000 200,000 8,921,892 Peninsular State Bank 2,500,000 1,000,000 27,489,812 Peoples State Bank 2,500,000 3,500,000 91,448,239 United Savings Bank of Detroit 500,000 150,000 5,610,713 Wayne County & Home Savings Bank 3,000,000 3,000,000 62,231,165 Edmore—Edmore State Bank 30,000 7,500 423, 702 Elk Rapids—Elk Rapids State Bank 35,000 15,000 340,072 Farmington—Farmington State Savings Bank.. 25,000 5,000 364,022 Fenton— Commercial Savings Bank 25,000 10,000 364,912 Fenton State Savings Bank 25,000 10,000 468,654 Flint- Citizens Commercial & Savings Bank 150,000 190,000 3,589,801 Genesee County Savings Bank 500,000 300,000 7,692,056 Industrial Savings Bank 250,000 250,000 5,736,115 Union Trust & Savings Bank 100,000 150,000 3,641,347 Flushing—Peoples State Bank 25,000 15,000 '237,991 Frankenmuth—Frankenmuth State Bank 50,000 15,000 745,459 Fremont- Fremont State Bank 25,000 23,000 570,176 Old State Bank 50,000 25,000 879,468 Grand Haven- Grand Haven State Bank 75,000 75,000 1,646,085 Peoples Savings Bank 50,000 22,000 738, 427 Grand Rapids- City Trust & Savings Bank 200,000 40,000 2,661,227 Commercial Savings Bank 300,000 60,000 2,806,549 Grand Rapids Savings Bank 400,000 350,000 8,560,741 Kent State Bank 500,000 500,000 10,481,693 Greenville—Commercial State Savings Bank 50,000 10,000 775,471 Hart—Oceana County Savings Bank 40,000 13,000 424,315 Highland Park—Highland Park State Bank 1,000,000 550,000 17,850,655 Hillsdale—Hillsdale State Bank 60,000 25,000 1,008,504 Holland- First State Bank 100,000 20,000 2,065,919 Holland City State Bank 100,000 50,000 1,486,671 Hudson- Boies State Savings Bank 75,000 25,000 713,080 Thompson Savings Bank 100,000 50,000 1,448,165 Imlay City— Lapeer County Bank 50,000 10,000 1,002,295 Peoples State Bank of Imlay City 50,000 10,000 656,026 Ionia—State Savings Bank 100,000 100,000 1,533,580 Jackson- Central State Bank 100,000 26,000 1,282,716 Jackson State Savings Bank !. 100,000 100,000 2,220,916 Union Bank 400,000 100,000 5,151,345 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

EXHIBIT J STATE BANK MEMBERSHIP. 227 Total re Capital. Surplus. sources. DISTRICT NO. 7—Continued. MICHIGAN—continued. Jonesville—Grosvenor Savings Bank $50,000 $25,000 $508,354 Lakeview— Commercial State Savings Bank 25,000 1,000 188,7 17 Farmers & Merchants State Bank 25,000 5,000 831 Lansing—Lansing State Savings Bank , 150,000 100,000 2,922,7 00 Lapeer—Lapeer Savings Bank 50,000 10,000 624,0 15 Lowell—City State Bank 25,000 10,000 522,5 50 Ludington—Ludington State Bank 100,000 20,000 1,257;4 89 Manchester- Peoples Bank 25,000 12,000 452 510 Union Savings Bank 25,000 50,000 777;8 01 Manistee—Manistee County Savings Bank , 100,000 100,000 2,160,9 11 Marcellus—G. W. Jones Exchange Bank 40,000 19,000 487,2 05 Marshall—Commercial Savings Bank 100,000 20,000 1,170,0 70 Milan—Milan State Savings Bank 25,000 7,000 228,5 53 Milford—First State Bank 25,000 6,000 443 119 Monroe—B. Dansard & Sons State Bank of Monroe 100,000 20,000 1,798:2 22 Morenci—Wakefield State Bank 50,000 30,000 102 Mount Pleasant- Exchange Savings Bank 50,000 30,000 895,8 11 Isabella County State Bank 60,000 6,000 1,077,9 46 Mount Clemens—Ullrich Savings Bank 100,000 100,000 1,416,5 80 Nashville—Farmers & Merchants Bank 30,000 35,000 667 588 Niles—Niles City Bank 100,000 20,000 852!7 31 Onsted—Onsted State Bank , 25,000 6,000 228;4 00 Otsego—Citizens State Savings Bank 25,000 2,500 213,2 05 Paw Paw—Paw Paw Savings Bank 40,000 10,000 375,2 67 Petersburg—H. C. McLachlin & Co. State Bank 25,000 5,000 406,7 38 Petoskey—First State Bank of Petoskey 50,000 10,000 934 Pontiac— American Savings Bank 100,000 30,800 954,1 58 Pontiac Savings Bank 200,000 65,000 4,257,5 29 Port Huron—Federal Commercial & Savings Bank. 150,000 50,000 3,996,0 24 Redford—Redford State Savings Bank 25,000 7,500 449,4 85 Rochester—Rochester Savings Bank 50,000 10,000 610,7 47 Rogers City—Presque Isle County Savings Bank... 35,000 12,000 826,3 53 Romeo—Romeo Savings Bank 50,000 30,000 1,376,4 46 Royal Oak- First Commercial State Bank 25,000 10,000 451 379 Royal Oak Savings Bank 40,000 10,000 834 504 St. Clair—Commercial & Savings Bank 50,000 10,000 714;2 39 Saginaw—Bank oi' Saginaw 500,000 700,000 14,697,6 32 Saline—Saline Savings Bank 25,000 22,000 402,2 56 Saugatuck—Fruit Growers State Bank 50,000 12,500 538,0 44 South Haven—Citizens State Bank 50,000 45,000 798.1 99 Suttons Bay—Leeianau County 25,000 10,000 330;4 10 Tecumseh— Lilley State Bank 40,000 20,000 615,5 78 Tecumseh State Savings Bank 26,000 26,000 671 730 Traverse City—Traverse City State Bank 200,000 100,000 2,680 027 Warren—State Savings Bank of Warren 25,000 25,000 671 212 Washington—Washington Savings Bank 25.000 10,000 271 355 Williamston—Williamston State Bank 50]000 10,000 335.0 24 "WISCONSIN. Baraboo—Bank of Baraboo 100,000 50,000 1,775 967 Burlington—Bank of Burlington 125,000 25,000 1,490,6 04 Clinton—Citizens Bank 50,000 10,000 421 160 Green Lake—Green Lake State Bank 25,000 10,000 363;0 89 Kenosha—Merchants & Savings Bank 100,000 13,000 1,500,3 80 Madison—Bank of Wisconsin 300,000 60,000 2,416,9 10 Milwaukee- American Exchange Bank 500,000 100,000 6,028,5 64 Badger State Bank 200,000 6,000 1,639.8 10 Marshall & Ilsley Bank 1,000,000 700,000 22,493 324 Second Ward Savings Bank 1,000,000 700,000 24,588;2 10 Mineral Point—Iowa County Bank 100,000 50,000 1,354,4 64 Mosinee—State Bank of Mosinee 45,000 25,000 502,9 27 Oakfield—Bank of Oakfield 25,000 10,000 275 762 Platteville—State Bank of Platteville 50,000 10,000 384 Plymouth- Plymouth Exchange Bank 100,000 40,000 908, State Bank of Plymouth 125,000 32,500 Sheboygan— Bank of Sheboygan 100,000 200,000 3,734 309 Citizens State Bank 200,000 125,000 2,175 576 Sturgeon Bay—Bank of Sturgeon Bay 50,000 10,000 1,519 831 Waupun—State Bank of Waupun 50,000 490:3 85 Wausau—Marathon County Bank 100,000 40,000 827! 448 Winneconne—Union Bank of Winneconne 25,000 8,500 372; 476 Total 71,994,500 63,422,490 11,330,062,231 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

228 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. Total re Capital. Surplus. I sources. DISTRICT NO. ; ARKANSAS. Blytheville—Farmers Bank & Trust Co.. $50,000 $25,000 $563,118 Helena—Security Bank & Trust Co 100,000 50,000 1,873,256- Jonesboro— Bank of Jonesboro 150,000 150,000 2,747,037 Jonesboro Trust Co 100,000 .50,000 1,034,187 Little Rock- Bank of Commerce 300,000 150,000 5,718,110 Bankers Trust Co 250,000 16,500 3,259,610 Mercantile Trust Co 300,000 60,000 2,106,469 Southern Trust Co 500,000 100,000 3,899,542 Union Trust Co 250,000 150,000 3,630,085 Texarkana—Merchants & Planters Bank. 200,000 11,500 1,048,806 East St. Louis—Illinois State Bank 400,000 25,000 4,227,410 Edwardsville—Citizens State & Trust Bank. 60.000 33,000 890,500 Effingham—Effingham State Bank 50,000 10,000 786,038 Gillespie—Gillespie Trust & Savings Bank... 50,000 15,000 649,197 Greenville—State Bank of Hoiles & Sons 100,000 30.000 1,263,011 Litchfield—Litchfield Bank & Trust Co 100,000 10,000 717,146 Quincy—State Savings Loan & Trust Co 1,000,000 8,551,720 INDIANA. Evansville—Mercantile-Commercial Bank. 200,000 100,000 2,663,277 Paoli—Paoli State Bank 25,000 1,250 239,937 KENTUCKY. Harrodsburg—State Bank & Trust Co 100,000 21,000 632,357 Hickman—Farmers & Merchants Bank 65,000 57,500 446,446 Louisville- Kentucky Title Savings Bank & Trust Co. 350,000 70,000 6,746,245 Liberty Insurance Bank 250,000 500,000 8,347,023- Owensboro—Central Trust Co 200,000 40,000 1,316,781 MISSOURI. Bowling Green—Pike County Bank 25,000 6,000 234,528 Jefferson City—Exchange Bank of Jefferson City. 100,000 20,000 1,182,466 Lexington—Lafayette County Trust Co 75,000 15,000 206,184 I/inn Creek—Camden County Bank 25,000 35,000 290,628 Macon—State Exchange Bank of Macon 100,000 20,000 718,119 Marshall—Wood & Houston Bank 100,000 150,000 1,906,544 St. Louis- American Trust Co ,000,000 118,000 8,492,883 Farmers & Merchants Trust Co 200,000 22,500 1,945,829 Franklin Bank 600,0G0 800,000 9,758,900 Liberty Bank. _ ,500,000 1,000,000 19,080,575 International Bank of St. Louis „ 500,000 500,000 7,659,104 Lafayette South Side Bank of St. Louis 800,000 400,000 14,438,345 Mercantile Trust Co i, 000, 000 6,500,000 61,728,581 Mississippi Valley Trust Co ;, ooo, ooo 3,500,000 40,385,975 St. Louis Union Bank 2,500,000 42,862,964 United States Bank _ ! . , , 0 5 0 0 0 0 , , 0 0 0 0 0 0 700,000 11,271,713 TENNESSEE. Memphis- Bank of Commerce & Trust Co 1,500,000 1,500,000 25,316,794 Commercial Trust & Savings Bank. 350,000 150,000 5,031,688 Guaranty Bank & Trust Co_ 500,0C0 1,827,407 Union Planters Bank & Trust Co 1,800,000 500,000 23,919,018 Total., 23,825,000 20,112,250 341,615,635 DISTRICT NO. 9. MICHIGAN. Gladstone—Gladstone State Savings Bank. 50,000 15,000 745,406 Gwinn—Gwinn State Savings Bank 25,000 15,000 334,413 IT on Mountain—Commercial Bank 100,0G0 50,000 1,262,026 Sault Ste. Marie—Sault Savings Bank 100,000 35,000 1,389,192 MINNESOTA. Benson—Swift County Bank 50,000 50,000 1,326,851 Clarkfield—Clarkfleld State Bank 50,0C0 10,000 925,121 JefEers—State Bank of letters , 25,000 10,000 359,887 Lake City—Lake City Bank of Minnesota... 50,000 50,000 672,989 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

EXHIBIT J STATE BANK MEMBERSHIP. 229 Total re Capital. Surplus. sources. DISTRICT NO. 9—Continued. MINNESOTA—continued. Lewiston—Security State Bank of Lewiston... $25,000 $30,000 $681, 563 Luverne—Rock County Bank 25,000 25,000 508, 251 Madelia—State Bank of Madelia 50,000 10,000 752,936 Minneapolis- North American Bank 200,000 200,000 4,922,964 St. Anthony Falls Bank 300,000 •60,000 4,157,309 Wells-Dickey Trust Co 500,000 20,000 1,440,890 New Richland—State Bank of New Richland.. 50,000 10,000 720,527 Red Wing—Bank of Pierce, Simmons & Co 125,000 60,000 1,222,490 St. Paul- Central Bank 200,000 40,000 2,288,818. Midland Trust & Savings Bank 214,136 26,890 292,758 Peoples Bank of St. Paul 300,000 60,000 2,714,406- South St. Paul- Drovers State Bank of South St. Paul 100,000 50,000 1,266,191 Exchange State Bank of South St. Paul... 125,000 25,000 220,000 Spring Valley- Farmers State Bank 25,000 5,000 218,550 First State Bank of Spring Valley 30,000 30,000 585,557 Virginia—American Exchange Bank 100,000 47,000 999,185 Westbrook—Citizens State Bank 25,000 7,000 223,892 Winona— Deposit Bank 400,000 100,000 3,629,082 Merchants Bank of Winona 100,000 50,000 3,041,556 Willmar—Kandiyohi County Bank 100,000 20,000 1,688,255 MONTANA. Billings—Security Trust & Savings Bank 100,000 832,419 Bozeman—Gallatin Trust & Savings Bank 100,000 25,000 793,173 Denton—Denton State Bank 25,000 3,500 280, 430 Dillon- Beaverhead State Bank 50,000 195, 258 Security State Bank 50,000 3,000 156, 295 Hamilton—Ravalli County Bank 50,000 12,500 467,472 Helena- Conrad Trust & Savings Bank 200,000 100,000 2,303,119 Union Bank & Trust Co 250,000 150,000 4,880, 775 Hingham—Hingham State Bank 35,000 5,000 274,453 Inverness—Inverness State Bank 25,000 1,000 173,192 Lewistown— Bank of Fergus County 250,000 250,000 3,494,988 Empire Bank & Trust Co 100,000 1,500 925, 578 Lewistown State Bank 50,000 15,000 335,694 Opheim—First State Bank of Opheim 25,000 5,000 216,988 Sidney—Yellowstone Valley Bank & Trust Co. 100,000 5,000 594,007 White Sulphur Springs—Central State Bank... 60, 000 15,000 433, 298 Wolf Point—First State Bank 30,000 6,000 348,155 NORTH DAKOTA. Enderlin—Enderlin State Bank... 50,000 10,000 622,943 Fargo—Northern Savings Bank... 100,000 15,000 2,037,987 Hettinger—Hettinger State Bank. 25,000 5,000 301,701 Noonan—Security State Bank 25,000 5,000 339,556 Williston—Bank of Williston 50,000 210,500 SOUTH DAKOTA. Belle Fourche—Butte County Bank 25,000 45,000 1,045,450 Brookings—Bank of Brookings 150,000 10,500 2,534,861 Camp Crook—Little Missouri Bank 25,000 544,010 Groton—Brown County Banking Co 25,000 5,000 664,606 Hecla—Farmers & Merchants State Bank. 25,000 5,000 320,810 Newell—Reclamation State Bank 25,000 228,163 Sioux Falls- Commercial & Savings Bank 100,000 3,000 565,915 Sioux Falls Savings Bank 200,000 27,500 4,980,523 Stratford—First State Bank 30,000 424,169 Timber Lake—Stock Growers State Bank. 25,000 14,000 268,643 Webster—Security Bank of Webster 40,000 12,000 1,613,951 WISCONSIN. Balsam Lake—Polk County Bank 25,000 5,000 266,156 Boyceville—Bank of Boyceville 30,000 5,000 340,599 Ellsworth—Bank of Ellsworth 50,000 15,000 845, 238 Glenwood City—First State Bank , 42,000 300 299,228 Grantsburg—First Bank of Grantsburg 50,000 2,300 565,821 Merrill—Lincoln County Bank 100,000 25,000 1,303, 420 New Richmond—Bank of New Richmond. 35,000 15,000 605, 330 West Salem—La Crosse County Bank 30,000 7,500 539, 359 Whitehall—Peoples State Bank , 30,000 5,000 346,341 Total. 6, 256,136 77,115,707 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

230 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. Capital. Surplus. Total re~ sources. DISTRICT NO. 10. COLORADO. Denver— American Bank & Trust Co , $500,000 $188,000 Denver Stock Yards Bank , 250,000 25,000 International Trust Co 500,000 500,000 KANSAS. Fairview—Fairview State Bank 30,000 16,000 Fort Scott—Fort Scott State Bank,... 100,000 30,000 Hiawatha—Morrill & Janes Bank 100,000 50,000 Topeka—Kansas Reserve State Bank. 200,000 51,500 Wichita—Southwest State Bank 200,000 50,000 Winfleld—The State Bank 100,000 50,000 MISSOURI. Kansas City- Commerce Trust Co 1,000,000 1,000,000 Fidelity Trust Co 1,000,000 1,000,000 Savannah—Wells-Hine Trust Co 100,000 1,800 South St. Joseph—St. Joseph Stock Yards Bank.. 250,000 100,000 NEBRASKA. Chappell—Chappell State Bank 25,000 25,000 David City—Butler County State Bank. 50,000 15,000 Elgin—Elgin State Bank 80,000 20,000 Lewellen—Bank of Lewellen 50,000 Lincoln—American State Bank 100,000 Neligh—Security State Bank 25,000 5,000 Pender—Pender State Bank 50,000 6,000 St. Edward—Farmers State Bank 25,000 Wayne—State Bank of Wayne 40,000 15,000 NEW MEXICO. Aztec—Citizens Bank of Aztec , 40,000 10,000 OKLAHOMA. Chelsea—Bank of Chelsea *50,000 5,000 Oklahoma City—Tradesmens State Bank. 200,000 25,000 P O o k n m ca u l C ge it e y — — G S u ec a u ra ri n ty ty 1 S S t t a a t t e e B B a a n n k k 1 1 0 0 0 0 , , 0 0 0 0 0 0 1 1 0 1 , , 0 0 0 0 0 0 Total. 5,265,000 3,209,580 DISTRICT NO. 11. Safford—Bank of Safford > 33,000 40,000 Tombstone—Cochise County State Bank. 30,000 6,000 LOUISIANA. Lake Providence—Lake Providence Bank. 25,000 5,000 NEW MEXICO. Albuquerque—American Trust & Savings Bank.. 100,000 40,000 Corona—Stockmens State Bank 30,000 3,000 Lovington—First Territorial Bank 30,000 50,000 Mountainair—Mountainair State Bank 25,000 10,000 Portales—Security State Bank 25,000 4,000 OKLAHOMA. Fort Towson—First State Bank 50,000 12,500 Valliant—Farmers State Guaranty Bank. 40,000 11,000 Alpine—Alpine State Bank $30,000 $30,000 Alto—Alto State Bank 25,000 7,500 Anson—Anson State Bank 35,000 10,000 A very—A very State Bank 25,000 5,000 Ballinger—Ballinger State Bank & Trust Co. 60,000 12,000 Beaumont— Guaranty Bank & Trust Co 100,000 12,000 Texas Bank & Trust Co 250,000 117,500 Beeville—Beeville Bank & Trust Co 50,000 26,000 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

EXHIBIT J STATE BANK MEMBERSHIP. 231 Capital. Surplus. Total re sources. DISTRICT NO. 11—Continued. TEXAS—continued. Bonham— Fannin County Bank $100,000 $50,000 $1,213,806 First State Bank of Bonham 200,000 100,000 1,089,229 Bremond—First State Bank 50,000 10,600 288,948 Brownfield—Brownfield State Bank 25,000 25,000 250,653 Canyon—First State Bank 25,000 2,500 300,172 Childress—Farmers & Mechanics State Bank 50,000 40,000 377,507 Collinsville—First Guaranty State Bank 25,000 6,000 268,579 Colorado—First State Bank ».. 30,000 91,391 Commerce—Citizens State Bank 25,000 2,500 202,313 Corsicana—First State Bank 100,000 15,000 817,992 Crowell—First State Bank 30,000 20,000 204,466 Cuero—First State Bank & Trust Co 100,000 38,000 660,644 Dallas- Central State Bank & Trust Co 300,000 31,000 2,401,949 First State Bank of Dallas 400,000 100,000 4,813,858 DeKalb—First State Bank 50,000 436,331 Denison—Denison Bank & Trust Co 100,000 25,000 1,658,614 Edgewood—Farmers & Merchants State Bank... 35,000 5,000 194,616 El Paso— El Paso Bank & Trust Co 200,000 1,694,864 Rio Grande Valley Bank & Trust Co 500,000 90,000 3,421,491 Ennis—First Guaranty State Bank & Trust Co.. 100,000 20,000 673,891 Flatonia—Flatonia State Bank 40,000 2,000 416,222 Franklin—First State Bank 30,000 10,000 248,812 Frost—Citizens State Bank 25,000 25,000 318,988 Galveston—South Texas State Bank 125,000 14,000 2,218,705 Gilmer—Gilmer State Bank 50,000 12,500 229,751 Goldthwaite—Trent State Bank 50,000 25,000 464,000 Graford—First State Bank 25,000 7,000 145,571 Grand Prairie—First State Bank 40,000 20,200 284,569 Hamlin—First State Bank 25,000 10,000 172,643 Hansford—Guaranty State Bank 25,000 2,000 100,215 Hereford—First State Bank & Trust Co 50,000 50,000 629,921 Hillsboro—First State Bank 150,000 15,000 871,522 Italy—Farmers State Bank 25,000 12,500 485,501 Jacksonville— Farmers Guaranty State Bank 50,000 10,000 367,880 First Guaranty State Bank. 50,000 10,000 533,448 Junction—Junction State Bank 50,000 50,000 378,454 Kerens—First State Bank 50,000 25,000 402,498 Killeen—First State Bank 25,000 7,500 171,264 Kirkland—First State Bank 25,000 10,000 156,853 Ladonia—First State Bank 25,000 12,500 367,584 Lamesa—First State Bank 30,000 20,000 269,185 Leonard—First State Bank 50,000 5,000 508,852 Lockney—Lockney State Bank 25,000 5,500 237,842 Lorenzo—First State Bank 25,000 107,631 Lubbock— Lubbock State Bank 100,000 17,500 587,514 Security State Bank & Trust Co 100,000 228,083 Memphis—"Citizens State Bank 75,000 47,500 425.459 Mount Calm—First State Bank 25,000 7,000 168,500 Mount Pleasant—Guaranty State Bank 60,000 15,000 539,284 Nacogdoches—Commercial Guaranty State Bank 100,000 20,000 1,149,760 Normangee—First State Bank 25,000 25,000 209,283 Paducah—First State Bank 50,000 50,000 406.460 Palmer—First Guaranty State Bank 25,000 12,500 240,651 Paris- First State Bank 150,000 75,000 1,299,799 Lamar State Bank & Trust Co 150,000 17,500 1,364,469 Pecos—Pecos Vallev State Bank 110,000 29,000 552, 744 Post City—First State Bank 25,000 88,183 Quanah—First Guaranty State Bank 100,000 50,000 616,217 Reagan—First State Bank 25,000 7,000 136,269 Richardson—Citizens State Bank 25,000 3,000 256,590 Rockwall—Guaranty State Bank 35,000 1,800 354,565 Royse City—First State Bank 35,000 15,000 425,020 Rusk—Fanners & Merchants State Bank 25,000 15,000 366,192 Sabinal—First State Bank 30,000 25,000 243,834 Santa Anna—First State Bank 35,000 8,000 179,875 Savoy—First State Bank 25,000 5,500 240,059 Shamrock—Farmers & Merchants State Bank... 50,000 50,000 362,728 Sinton—Bank of Commerce 25,000 7,000 335,142 Snyder—First State Bank & Trust Co 50,000 25,000 236,188 Stamford—First State Bank 55,000 13,000 380,801 Sweetwater—Texas Bank & Trust Co 100,000 75,000 365,303 Terrell—Fiist State Bank 100,000 60,000 825,022 Tioga—First Guaranty State Bank 30,000 7,500 208,447 Trenton—Guaranty State Bank 25,000 5,000 an, 35i Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

232 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. Capital. Surplus. Total re sources. DISTRICT NO. 11—Continued. TEXAS—continued. Tyler- Guaranty State Bank .*. $200,000 $55,000 $1,168,086 Peoples Guaranty State Bank 100,000 25,000 639,890 Weatherford—First State Bank 125,000 15,000 750,552 "Wharton—Security Bank & Trust Co 50,000 6,000 479,584 White Deer—First State Bank 25,000 115,609 Winnsboro—Merchants & Planters State Bank 30,000 30,000 412,219 Wolfe Citv—First State Bank 50,000 22,000 483,244 Wylie—First State Bank 30,000 15,000 Total 6,848,000 2,199,600 57,301,834 DISTRICT NO. 12. ARIZONA. 500,000 100,000 4,195,679 Phoenix—Valley Bank CALIFORNIA. 50,000 50,000 933,448 Placerville—A. Mierson Banking Co 25,000 2,500 121/873 San Fernando—San Fernando Valley Savings Bank 110,000 51,000 1,524,713 Santa Monica—Bank of Santa Monica 640,000 210,000 5,497,499 Stockton—Farmers & Merchants Bank of Stockton. IDAHO. Ashton—Security State Bank 25,000 20,000 473,623 Blackfoot—Blackfoot City Bank 50,000 10,000 595,117 Cambridge—Peoples Bank 40,000 2,000 347,519 Emmett—Bank of Emmett 60,000 10,000 540,396 Filer—Farmers & Merchants Bank 25,000 120,888 Genesee—Genesee Exchange Bank 25,000 12,500 548,740 Gooding—Citizens State Bank 25,000 10,000 327,173 Idaho Falls- Anderson Bros. Bank 100,000 100,000 2,074,748 Farmers & Merchants Bank 150,000 7,500 1,314,325 Kimberly—Bank of Kimberly 35,000 11,000 382, 624 May—Union Central Bank , 30,000 1,000 81,495 Menan—Jefferson State Bank 25,000 27,388 Meridian—Meridian State Bank , 25,000 111, 706 Murtaugh—Bank of Murtaugh 25,000 81,228 Nezperce—Union State Bank 50,000 10,000 307,577 Orofino—Bank of Orofino 25,000 3,500 274,430 Parma—Parma State Bank 100,000 25,000 652,587 Picabo—Picabo State Bank 25,000 80,944 Pocatello—Citizens Bank , 100,000 20,000 1,061,866 Potlatch—Potlatch State Bank 50,000 10,000 772,964 Rexburg—Farmers & Merchants Bank 50,000 6,000 373,895 Rigby—Rigby State Bank 30,000 10,000 376,611 St. Anthony—St. Anthony Bank & Trust Co 30,000 14,000 551,434 Star—Farmers Bank 25,000 5,000 213,763 Sugar City—Fremont County Bank 25,000 2,000 234,623, Sweet—Farmers & Stockgrowers Bank 25,000 149,937 Victor—Victor State Bank 25,000 196,648 OREGON. Astoria—Scandinavian American Bank 100,000 10,000 1,545,914: Enterprise—Enterprise State Bank 50,000 10,000 286,23? Hood River—Butler Banking Co 100,000 2o,oeo 1,052,121 Joseph—First Bank of Joseph 50,000 10,000 323,569 Marshfield— Bank of Southwestern Oregon 100,000 10,000 949,209 Scandinavian American Bank 25,000 5,153 259,082 Moro—Farmers State Bank 25,000 1,250 310,080. North Portland—Live Stock State Bank 100,000 20,000 1,647,472 Oregon City—Bank of Oregon City 100,000 50,000 1,320,011 Portland—Ladd & Tilton Bank , 000,000 1,000,000 24,399,532. Redmond—Redmond Bank of Commerce 25,000 5,000 216,563, Tillamook—Tillamook County Bank 40,000 7,000 660,102-, UTAH. Delta—Delta State Bank 25,000 4,000 230,872> Kaysville—Barnes Banking Co 50,000 50,000 436,801 Logan—Thatcher Bros. Banking Co 150,000 50,000 1,605,082; Magna—Magna Banking Co 25,000 2,500 292,791 Ogden—Ogden Savings Bank 150,000 150,000 1,496,188; Payson—Payson Exchange Savings Bank 50,000 25,000 539,958; Price—Price Commercial & Savings Bank 50,000 45,000 760,374 Provo—Knight Trust & Savings Bank 300,000 15,000 1,595,140, Richfield— James M. Peterson Bank 48,000 23,000 553,198: Digitized for FSRtAatSe EBRan k of Sevier 45,000 25,COO 595,043; http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

EXHIBIT J STATE BANK MEMBERSHIP. 233 Capital. Surplus. DISTRICT NO. 12—Continued. UTAH—continued. Salt Lake City— Deseret Savings Bank $500,000 $300,000 Farmers & Stockgrowers Bank 300,000 20,000 McCornick & Co., Bankers 600,000 120,000 Utah Savings & Trust Co 300,000 20,000 Walker Bros., Bankers 500,000 100,000 WASHINGTON. Albion—Albion State Bank 25,000 5,000 Almira—Almira State Bank 50,000 10,000 Centralia—Centralia State Bank 100,000 10,000 Chehalis—Coffman, Dobson & Co., Bankers (Inc.) 150,000 100,000 Colfax—First Savings & Trust Bank of Whitman County 50,000 15,000 Enumclaw—Peoples State B ank 25,000 6,250 Farmington—Bank of Farmington 25,000 5,000 Hoquiam—Lumberman's Bank 100,000 14,500 La Crosse—First State Bank of La Crosse 60,000 15,000 Molson—Molson State Bank 25, 000 4,250 NoFth Yakima—Yakima Valley Bank 100,000 18,000 Odessa—Farmers & Merchants Bank 25,000 2,500 Port Townsend—Merchants Bank of Port Townscnd 75,000 25,000 Reardan—Farmers State Bank 25,000 10,000 Rosalia—Bank of Rosalia 25,000 5,000 St. John—Farmers State Bank 25,000 3,125 Seattle- Dexter Horton Trust & Savings Bank 400,000 100,000 Metropolitan Bank 200,000 100,000 Scandinavian American Bank 1,000,000 500,000 South Bellingham—Northwestern State Bank of Bellingham. 100,000 60,000 Spokane—Spokane & Eastern Trust Co 1,000,000 200,000 Stanwood—Bank of Stanwood 25,000 10,000 Tacoma—Fidelity Trust Co 500,000 300,000 Tekoa— Citizens State Bank 25,000 10,000 Tekoa State Bank 30,000 15,000 Toppenish—Traders Bank 25,000 10,000 Walla Walla—Farmers Savings Bank 200,000 40,000 Wilbur—State Bank of Wilbur 50,000 7,000 Total. 11,773,000 4,407,528 Statement showing membership of State banks and trust companies in the Federal Re serve system, up to and including Dec. SI, 1918, classified by districts as to number of banks, capital, surplus, and resources. Num District. b b a e n r k o s f . Capital. Surplus. res T o o u t r a c l e s ' . No. 1—Boston 31 $27,075,000 $29,379,000 $628,462,609 No. 2—New York 101 117,391,273 156,439, 846 3,366,784,468 No. 3—Philadelphia 30 21,385,712 45,237,205 339,571,901 No. 4—Cleveland 67 31,620,000 59,098,750 585,590,840 No. 5—Richmond 37 9,376,250 6,459,140 108,983,839 No. 6—Atlanta 54 15,840,000 10,056,760 238,500,448 No. 7—Chicago 288 71,994,500 63,422,490 1,330,062,231 No. 8—St. Louis 44 23,825,000 20,112,250 341,615,635 No. 9—Minneapolis.... 70 6,256,136 1,945,493 77,115,707 No. 10—Kansas City 27 5,265,000 3,209,580 103,243,414 No. 11—Dallas 100 6,848,000 2,199,600 57,301.834 No. 12—San Francisco .. 87 11,773,000 4,407,528 161,579,849 Total 936 348,649,871 401,967,642 7,333,812,775 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

234 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. 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. Buenos Aires, Argentina Sept. 2,1914 Subbranch—Monte video, Uruguay x Apr. 16,1915 Rio de Janeiro, Brazil Sept. 2,1914 Subbranches—Santos, Sao Paulo, Pernambuco, Para, and Bahia, Brazil Dec. 23,1914 Havana, Cuba Mar. 17,1915 Subbranches—Santiago, Matanzas, Cienfuegos, Guantanamo, Camaguey, Cardenas, Manzanillo, Cuba; Kingston, Jamaica; and Santo Domingo, Santo Domingo Mar. 17,1915 Subbranch at Sagua la Grande, Cuba Sept. 21,1918 Valparaiso, Chile Oct. ' 18,1915 Subbranches—Antofagasta and Santiago, Chile Oct. 18,1915 Genoa, Italy May 25,1916 Subbranches—Turin, Milan, Venice, Florence, Rome, Naples, and Palermo, Italy May 25,1916 Fetrograd, Russia July 5,1916 Subbranches—Moscow, Odessa, Warsaw, Riga, Baku, Astra khan, Vladivostock, Sebastopol, Helsingfors, and Vilna, Rus sia July 5,1916 Lima, Peru July 31,1917 Subbranches—Payta, Callao, and Mollendo, Peru July 31,1917 Caracas, Venezuela July 31,1917 Subbranches—La Guayra, Porto Cabello, and Maracaybo July 31,1917 San Juan, P. R Feb. 13,1918 Subbranches—Arecibo, Mayaguez, and Ponce Feb. 13,1918 Lisbon, Portugal. Subbranch-—Oporto Dec. 11,1918 Brussels or Antwerp, Belgium. Subbranch in the other of the said two cities Dec. 11,1918 Zurich, Switzerland. Subbranches—Berne and Geneva Dec. 11,1918 First National Bank, Boston, Mass.: Buenos Aires, Argentina Jan. 29,1917 1 Made an independent branch. Dec. 3,1917. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. 235 Exhibit L.—FIDUCIARY POWERS GRANTED. List of national banks given fiduciary powers from Jan. l 1918, to Dec. SI, 1918. y DISTRICT NO. 1. Location. Name of bank. Powers granted. Connecticut: Hartford First National Bank Trustee, executor, administrator, registrar of stocks and bonds, guardian of estates, and receiver. Bo Phoenix National Bank... Do.i New Haven.. First National Bank Do. Wallingford.. do Guardian of estates and receiver and registrar of stocks and bonds.3 Waterbury.. Manufacturers National Guardian of estates and receiver. Bank. Do Waterburv National Bank Trustee, executor, administrator, registrar of stocks and bonds, guardian of estates, and receiver. Maine: Portland... Canal National Bank. Assignee and receiver.1 Massachusetts: Boston First National Bank.. Guardian of estates, assignee, receiver, and con servator.3 Do. Fourth Atlantic National Guardian of estates, assignee, and receiver.2 Bank. Do. Merchants National Bank, Do.2 Do. National Union Bank Trustee, executor, administrator, and registrar of stocks and bonds. Do. Second National Bank Guardian of estates, assignee, and receiver.3 Do. Webster & Atlas National Do.3 Bank. Fitchburg., Safety Fund National Do.8 Bank. Gardner... First National Bank Guardian of estates, receiver, guardian or trustee under a will or instrument creating a trust for the care of property, conservator of the property of persons incapacitated by age.3 Lawrence. Bay State National Bank. Trustee, executor, administrator, registrar of stocks and bonds, guardian of estates, assignee, and re ceiver. Leominster. Merchants National Bank. Guardian of estates, assignee, and receiver and con servator^ Lynn Central National Bank Trustee, executor, administrator, registrar of stocks and bonds, guardian of estates, assignee, and re ceiver. Do. Manufacturers National Guardian of estates, assignee, and receiver.3 Bank. Marlborough.. Peoples National Bank... Do.3 New Bedford. Mechanics National Bank, Guardian of estates, assignee, and receiver.3 Reading First National Bank Trustee, executor, administrator, and registrar o! stocks and bonds. Salem Merchants National Bank. Guardian of estates, assignee, and receiver.3 Springfield. Chapin National Bank Executor, administrator, registrar of stocks and bonds, guardian of estates, assignee, and receiver.1 Do Chicopee National Bank.. Guardian of estates, assignee, and receiver.3 Do Springfield National Bank Trustee and registrar of stocks and bonds. Turners Falls. Crocker National Bank Guardian of estates, assignee, and receiver.3 Uxbridge Trustee, executor, administrator, and registrar of Blackstone National Bank stocks and bonds. Worcester Guardian of estates, assignee, and receiver.3 New Hampshire: Merchants National Bank. Berlin Trustee. Vermont: City National Bank Barre Peoples National Bank.. Trustee, executor, and administrator. Bellows Falls. National Bank of Do. Bennington... County National Bank Trustee, executor, administrator, and registrar of (formerly Bennington stocks and bonds. County National Bank). 1 Previously granted permission to act as trustee, executor, and registrar of stocks and bonds. 2 Previously granted permission to act as trustee, executor, and administrator. 8 Previously granted permission to act as trustee, executor, administrator, and registrar of stocks and bonds. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

236 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. List of national banks given fiduciary powers from Jan. 1, 1918, to Dec. 31, 1918—Con. DISTRICT NO. 2. Location. Name of bank. Powers granted. Connecticut: Bridgeport City National Bank Guardian of estates and receiver.1 Greenwich Trustee, executor, administrator, registrar of stocks and bonds, guardian of estates, and receiver. New Jersey: Greenwich National Bank. Trustee, executor, administrator, registrar of stocks and bonds, assignee, receiver, guardian of es Merchants National Bank. tates, and committee of estates of lunatics. Trustee and registrar of stocks and bonds. Morristown Union National Bank Registrar of stocks and bonds, guardian of estates, National Iron Bank assignee, receiver and committee of estates of lunatics.2 Paterson Registrar of stocks and bonds. Do Second National Bank Guardian of estates, assignee, receiver and commit tee of estates of lunatics.1 Phillipsburg Phillipsburg National Do.1 Bank. New York: Albany National Commercial Bank Trustee, executor, administrator, guardian of es tates, assignee, receiver and committee of estates of lunatics.3 Buffalo Manufacturers and Trad Trustee, executor, administrator, registrar of stocks ers National Bank. and bonds, guardian of estates, assignee, receiver and committee of estates of lunatics. Canandaigua Canandaigua National Do. Bank. Canton St. Lawrence County Na Trustee, executor, administrator, guardian, assignee, tional Bank. receiver and committee of estates of lunatics. Catskill Catskill National Bank Trustee, executor, administrator, registrar of stocks and bonds, guardian of estates, assignee, receiver and committee of estates of lunatics. Second National Bank Do. Dunkirk Lake Shore National Bank Do. Elmira Merchants National Bank. Trustee, executor, administrator, guardian of es tates, registrar of stocks and bonds, assignee and receiver. Do Second National Bank Trustee, executor, administrator, registrar of stocks and bonds, guardian of estates, assignee, receiver and committee of estates of lunatics.3 0 eneva Trustee, executor, administrator, guardian of es tates, assignee, receiver and committee of estates of lunatics.3 Glens Falls Merchants National Bank. Trustee, executor, administrator, registrar of stocks and bonds, guardian of estates, assignee, receiver and committee of estates of lunatics. Do. National Chautauqua Do. County Bank. Lockport Niagara County National Do. Bank. American Exchange Na Do. tional Bank. Do Atlantic National Bank... Trustee, executor, administrator, guardian of es tates, assignee, receiver and committee of estates of lunatics.3 Do Chemical National Bank.. Do.3 Do Citizens National Bank... Trustee, executor, administrator, registrar of stocks and bonds, guardian of estates, assignee, receiver and committee of estates of lunatics. Do First National Bank Trustee, executor, administrator, guardian of es tates, assignee, receiver and committee of estates of lunatics.3 Do Hanover National Bank... Trustee, executor, administrator, registrar of stocks and bonds, guardian of estates, assignee, receiver and committee of estates of lunatics. Do Irving National Bank Trustee, executor, administrator, guardian of es tates, assignee, receiver and committee of estates of lunatics.3 Do Lincoln National Bank Do.3 Do 1 Mechanics & Metals Na: Trustee, executor, administrator, registrar of stocks tional Bank. and bonds, guardian of estates, assignee, receiver and committee of estates of lunatics.3 Do National Park Bank Do.3 Nyack Do. Oneonta Citizens National Bank... Do. Utica Utica City National Bank. Do. Watertown Watertown National Bank Do. 1 Previously granted permission to act as trustee, executor, administrator, and registrator of stocks and bonds. 2 Previously granted permission to act as trustee, executor, and administrator. Digitized for 3 F PRrAevSioEuRsl y granted permission to act as registrar of stocks and bonds. http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

EXHIBIT L—FIDUCIARY POWERS GRANTED. 237 List of national banks given fiduciary -power8 from Jan. 1, 1918, to Dec. 31. 1918—Con. DISTRICT NO. 3. location. Name of bank. Powers granted. New Jersey: Swedesboro. Swedesboro National Trustee, executor, administrator, registrar of stocks Bank. and bonds, guardian of estates, assignee, receiver and committee of estates of lunatics. Woodbury.. First National Bank. Do. Pennsylvania: Allentown.. Merchants National Bank, Do. Atglen Atglen National Bank Trustee, executor, and administrator. Boyertown.. National Bank of Trustee, executor, administrator, and registrar of stocks and bonds. Danville First National Bank Trustee, executor, and administrator. Lancaster... Conestoga National Bank, Do. Scranton Third National Bank Trustee, executor, administrator, guardian of es tates, assignee, receiver and committee of estates of lunatics.1 South Bethlehem.. .j South Bethlehem National Guardian of estates, assignee, and receiver and com Bank. mittee of estates of lunatics.2 Topton National Bank of Topton. Registrar of stocks and bonds.3 Wilkes-Barre Wyoming National Bank . Trustee, executor, administrator, and registrar of stocks and bonds. Williamsport First National Bank Trustee, executor, administrator, registrar of stocks and bonds, guardian of estates, assignee, receiver and committee of estates of lunatics. York. Western National Bank... Do. DISTRICT NO. 4. Kentucky: Paris Trustee, executor, administrator, and registrar of stocks and bonds. Ohio: Cleveland Union Commerce Na Registrar of stocks and bonds. tional Bank. Toledo Northern National Bank.. Do. Pennsylvania: Grove City First National Bank Trustee. Pittsburgh Peoples National Bank Registrar of stocks and bonds. Do Western National Bank... Trustee, executor, administrator, registrar of stocks and bonds, guardian of estates, assignee, receiver and committee of estates of lunatics. Second National Bank Washington Citizens National Bank... Trustee, executor, administrator, guardian of estates, assignee, and receiver. DISTRICT NO. , Maryland: Baltimore Second National Bank.... Trustee, executor, administrator, registrar of stocks and bonds, guardian of estates, assignee, and re ceiver, and committee of estates of lunatics. New Windsor Trustee, executor, administrator, and registrar of stocks and bonds. North Carolina: High Point Commercial National Bank Do. South Carolina: Greenville Fourth National Bank Do. York Do. Virginia: Chatham do Trustee, executor, and administrator. Clifton Forge do Trustee, executor, administrator, registrar of stocks and bonds, guradian of estates' and assignee. Harrisonburg do.. Trustee, executor, and administrator. Reedville Commonwealth National Do. Bank. Peoples National Bank Trustee, executor, administrator, and registrar of stocks and bonds. VV est Virginia: Madison Madison National Bank... Trustee, executor and administrator, and registrar of stocks and bonds. 1 Previously granted permission to act as registrar of stocks and bonds. 2 Previously granted permission to act as trustee, executor, administrator, and registrar of stocks and bonds. 8 Previously granted permission to act as trustee, executor, and administrator. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

238 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. List of national banks given fiduciary powers from Jan. 1, 1918, to Dec. 31, 1918—Com. DISTRICT NO. 6. Location. Name of bank. Powers granted. Alabama: Seima. City National Bank... Trustee, executor, administrator, and registrar of stocks and bonds. Florida: DeFuniak Springs. First National Bank Do. Pensaeola.. National Bank of Com Registrar and Trustee of Florida State, County, and merce. municipal bonds or bonds or notes issued by a cor poration. Tampa.. First National Bank Trustee, executor, administrator, and registrar of stocks and bonds. Mississippi: Canton.. .do.. Do. Dickson. Citizens National Bank.., Trustee and registrar of stocks and bonds. DISTRICT NO. 7. Illinois: Chicago. First National Bank of Trustee, executor, administrator, and registrar of Englewood. stocks and bonds. Chillicothe. First National Bank Trustee, executor, administrator, guardian of es tates, assignee, and receiver. Decatur National Bank of. Trustee, executor, administrator, and registrar of stocks and bonds. Kankakee.. City National Bank.. Do. Kewanee... First National Bank. Trustee,executor,administrator,guardian of estates, . assignee, and receiver. La Salle.. La Salle National Bank... Trustee, executor, administrator, and registrar of stocks and bonds. Macomb. Union National Bank Trustee, executor, administrator, guardian of es tates, assignee, and receiver. Monticello. First National Bank Do. Indiana: Dana .do. Trustee, executor, and administrator. Dublin .do . Do. Edinburg.. Farmers National Bank.. Trustee, executor, administrator, and registrar of stocks and bonds. New Carlisle. First National Bank. Trustee, executor, and administrator. Newcastle— ....do Trustee, executor, administrator, and registrar of stocks and bonds. Thornton. Home National Bank. Trustee, executor, and administrator. Winamac. First National Bank.. Trustee, executor, administrator, and registrar of stocks and bonds. Iowa: Arlington. American National Bank Trustee, executor, and administrator. (formerly German- American National Bank.) Cherokee., First National Bank Trustee, executor, adminsitrator, registrar of stocks and bonds, guardian of estates, assignee, receiver. Everly .do. Do Marshalltown. .do. Trustee, executor, and administrator. Royal Citizens National Bank... Do. Washington... Washington National Trustee, executor, administrator, and registrar of Bank. stocks and bonds. Michigan: Hillsdale First National Bank. Do. Port Huron. .....do Do. Wisconsin: Appleton... Citizens National Bank.. Trustee, executor, administrator, registrar of stocks and bonds, guardian of estates, assignee, and re ceiver. Commercial National Bank Do. Fond du Lac. do Trustee, executor, administrator, registrar of stocks and bonds. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

EXHIBIT L—FIDUCIARY POWERS GRANTED. 239 List of national banks given fiduciary powers from Jan. 1, 1918, to Dec. SI, 1918—Con. DISTRICT NO. 8. Location. Name of bank. Powers granted. Arkansas: El Dorado Citizens National Bank... Trustee, executor, administrator, and registrar of Illinois: stocks and bonds. Belleville Trustee, executor, administrator, guardian of es tates, assignee and receiver. Mount Sterling do Trustee, executor, administrator, and registrar of stocks and bonds. Murphysboro . ..do Guardian of estates, assignee, and receiver.i Quincy Ricker National Bank Trustee, executor, administrator, guardian of es tates, assignee, and receiver. Kentucky: Ownesboro United States National Trustee, executor and administrator. Bank. Paducah Do. Mississippi: Greenville do Trustee, executor, administrator, and registrar of stocks and bonds. Missouri: St. Louis Third National Bank Do. DISTRICT NO. 9. Michigan: Manistique First National Bank Trustee, executor, administrator, and registrar of stocks and bonds. Minnesota: Duluth do Trustee, executor, administrator, registrar of stocks and bonds, guardian of estates, assignee, and com mittee of estates of lunatics. Montana: Billings Merchants National Bank. Trustee, executor, administrator, and registrar of stocks and bonds. Do Montana National Bank.. Do. Bozeman Commercial National Bank Do. North Dakota: Forman First National Bank Trustee, executor, and administrator. Wisconsin: Ashland Ashland National Bank... Trustee, executor, administrator, registrar of stocks and bonds, guardian of estates, assignee, and receiver. Do Northern National Bank.. Do. Barron First National Bank Trustee, executor, and administrator Superior Do. DISTRIC1 * NO. 10. Colorado: Boulder Boulder National Bank... Trustee, executor, administrator, and registrar of stocks and bonds. Englewood First National Bank Do. do Trustee, executor, administrator, registrar of stocks and bonds, guardian of estates, assignee, receiver, and committee of estates of lunatics.1 Longmont American National Bank.. Do. Kansas: Commercial National Bank Trustee, executor, administrator, and registrar of stocks and bonds. Troy First National Bank Trustee, executor, and administrator. Missouri: Cameron do Do. St. Joseph American National Bank.. Trustee, executor, administrator, and registrar of stocks and bonds. Nebraska: Omaha Merchants National Bank. Do. New Mexico: Las Vegas San Miguel National Bank. Do. Oklahoma: Pond Creek Farmers National Bank... Do. Shawnee National Bank of Com Trustee, executor, and administrator. merce. Tulsa Central National Bank Trustee, executor, administrator, and registrar of stocks and bonds. Wyoming: Casper Wyoming National Bank. Do. Chevenne Stock Growers National Do. Bank. Cody Shoshone National Bank.. Trustee and registrar of bonds. i Previously granted permission to act as trustee, executor, administrator, and registrar of stocks and Digitized fobr oFnRdsA. SER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

240 ANNUAL REPOKT OF THE FEDERAL RESERVE BOARD. List of natio7ial banks given fiduciary powers from Jan. 1, 1918, to Dec. 31,1918—Con. DISTRICT NO. 11. Location. Name of bank. Powers granted. New Mexico: R oswell First National Bank Trustee, executor, and administrator. Texas: Amarillo do Trustee, executor, administrator, and registrar of stocks and bonds. Fort "Worth Fort Worth National Bank Do. Sherman Commercial National Bank Trustee, executor, administrator, guardian of estates, assignee, receiver, and committee of es tates of lunatics. Wichita Falls National Bank of Com Trustee, executor, administrator, and registrar of merce. stocks and bonds. DISTRICT NO. 12. California: Bakersneld First National Bank Trustee, executor, administrator, registrar of stocks and bonds, guardian of estates, assignee, and receiver. Fresno Farmers National Bank... Do. Oakland Central National Bank Do. Bank of California, Na Do. tional. Washington: Seattle National City Bank Trustee, executor, administrator, and registrar of stocks and bonds. Do Trustee, executor, administrator, registrar of stocks and bonds, guardian of estates, assignee, and receiver. Walla Walla Third National Bank Trustee, executor, and administrator. Exhibit M.—ACCEPTANCES TO 100 PER CENT. The following banks have been granted authority by the Federal Keserve Board to accept drafts and bills of exchange up to 100 per cent of their capital stock and surplus: District No. 1: Hartford Aetna National Bank, Hartford, Conn. Phoenix National Bank, Hartford, Conn. Beacon Trust Company, Boston, Mass. First National Bank, Boston, Mass. Fourth-Atlantic National Bank, Boston, Mass. Merchants National Bank, Boston, Mass. National Shawmut Bank, Boston, Mass. National Union Bank, Boston, Mass. Old Colony Trust Company, Boston, Mass. Second National Bank, Boston, Mass. State Street Trust Company, Boston, Mass. Webster & Atlas National Bank, Boston, Mass. Dedham National Bank, Dedham, Mass. Massasoit-Pocasset National Bank, Fall River, Mass. Safety Fund National Bank, Fitchburg, Mass. Mechanics National Bank, New Bedford, Mass. Springfield National Bank, Springfield, Mass. Merchants National Bank, Worcester, Mass. Blackstone Canal National Bank, Providence, R. I. Merchants National Bank, Providence, R. I. Providence National Bank, Providence, R. I. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

EXHIBIT M ACCEPTANCES TO 100 PER CENT. 241 District No. 2: National Bank of New Jersey, New Brunswick, N. J. American Exchange National Bank, New York City. Atlantic National Bank, New York City. Bankers Trust Company, New York City. Bank of Manhattan Company, New York City. Bank of New York, N. A., New York City. Central Union Trust Company, New York City. Chase National Bank, New York City. Chemical National Bank, New York City. Citizens National Bank, New York City. Columbia Trust Company, New York City. Corn Exchange Bank, New York City. Equitable Trust Company, New York City. First National Bank, New York City. Franklin Trust Company, New York City. Guaranty Trust Company, New York City. Harriman National Bank, New York City. Importers & Traders National Bank, New York City. Irving National Bank, New York City. Liberty National Bank, New York City. Mechanics & Metals National Bank, New York City. Mercantile Bank of the Americas, New York City. Merchants National Bank, New York City. National Bank of Commerce, New York City. National City Bank, New York City. National Park Bank, New York City. New Netherland Bank, New York City. Scandinavian Trust Company, New York City, Seaboard National Bank, New York City. Second National Bank, New York City. U. S. Mortgage & Trust Company, New York City. W. R. Grace & Co.'s Bank, New York City. First National Bank, Utica, N. Y. District No. 3: Bank of North America, Philadelphia, Pa. Corn Exchange National Bank, Philadelphia, Pa. First National Bank, Philadelphia, Pa. Fourth Street National Bank, Philadelphia, Pa. Girard National Bank, Philadelphia, Pa. Market Street National Bank, Philadelphia, Pa. Philadelphia National Bank, Philadelphia, Pa. Tradesmen's National Bank, Philadelphia, Pa. District No. 4: Fifth-Third National Bank, Cincinnati, Ohio. Cleveland Trust Company, Cleveland, Ohio. First National Bank, Cleveland, Ohio. Superior Savings & Trust Company, Cleveland, Ohio. Union Commerce National Bank, Cleveland, Ohio. Bank of Pittsburgh, Pittsburgh, Pa. First National Bank, Pittsburgh, Pa. Mellon National Bank, Pittsburgh, Pa. 100823°—19 16 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

242 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. District No. 4—Continued. Peoples National Bank, Pittsburgh, Pa. Pittsburgh Trust Company, Pittsburgh, Pa. Union Trust Company, Pittsburgh, Pa. District No. 5: Baltimore Trust Company, Baltimore, Md. Farmers & Merchants National Bank, Baltimore, Md. Merchants-Mechanics-First National Bank, Baltimore, Md. National Bank of Commerce, Baltimore, Md. National Union Bank of Maryland, Baltimore, Md. Second National Bank, Baltimore, Md. Murchison National Bank, Wilmington, N. C. Bank of Charleston, N. B. A., Charleston, S. C. Peoples National Bank, Charleston, S. C. First National Bank, Danville, Va. Merchants National Bank, Hampton, Va. Citizens Bank, Norfolk, Va. Norfolk National Bank, Norfolk, Va. Seaboard National Bank, Norfolk, Va. Virginia National Bank, Norfolk, Va. American National Bank, Richmond, Va. First National Bank, Richmond, Va. Merchants National Bank, Richmond, Va. National State and City Bank, Richmond, Va. District No. 6: Central National Bank, Albany, Ala. Farmers & Merchants National Bank, Troy, Ala. Fourth National Bank, Atlanta, Ga. American National Bank, Cordele, Ga. Fourth National Bank, Macon, Ga. Macon National Bank, Macon, Ga. National Bank of Savannah, Ga. Savannah Bank & Trust Company, Savannah, Ga. Canal Bank & Trust Company, New Orleans, La. Commercial National Bank, New Orleans, La. Commercial Trust & Savings Bank, New Orleans, La. Hibernia Bank & Trust Company, New Orleans, La. Interstate Trust & Banking Company, New Orleans, La. Marine Bank & Trust Company, New Orleans, La. New Orleans National Bank, New Orleans, La. Whitney-Central National Bank, New Orleans, La. Merchants National Bank, Vicksburg, Miss. Hamilton National Bank, Chattanooga, Tenn. District No. 7: Continental & Commercial National Bank, Chicago, 111. Corn Exchange National Bank, Chicago, 111. Drovers National Bank, Chicago, 111. First National Bank, Chicago, 111. Fort Dearborn National Bank, Chicago, 111. Harris Trust & Savings Bank, Chicago, 111. Merchants Loan & Trust Company, Chicago, 111. National Bank of the Republic, Chicago, 111. National City Bank, Chicago, 111. Union Trust Company, Chicago, 111. Digitized for FRASERF irst National Bank, Milwaukee, Wis. http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

EXHIBIT M ACCEPTANCES TO 100 PER CENT. 243 District No. 8: First National Bank, Canton, Miss. Union & Planters Bank & Trust Company, Memphis, Tenn. Central State National Bank, Memphis, Tenn. Mercantile Trust Co., St. Louis, Mo. Merchants Laclede National Bank, St. Louis, Mo. Third National Bank, St. Louis, Mo. Merchants-American National Bank, St. Louis, Mo. National Bank of Commerce, St. Louis, Mo. District No. 9: First & Security National Bank, Minneapolis, Minn. Capital National Bank, St. Paul, Minn. District No. 10: First National Bank, Hutchinson, Kans. First National Bank, St. Joseph, Mo. District No. 11: First National Bank, Nogales, Ariz. American National Bank, Austin, Tex. American Exchange National Bank, Dallas, Tex. City National Bank, Dallas, Tex. Tenison National Bank, Dallas, Tex. American National Bank, Fort Worth, Tex. Fort Worth National Bank, Fort Worth, Tex. State National Bank, Honey Grove, Tex. First National Bank, Houston, Tex. Houston National Exchange Bank, Houston, Tex, South Texas Commercial National Bank, Houston, Tex. Union National Bank, Houston, Tex. First National Bank, Navasota, Tex. First National Bank, Terrell, Tex. American National Bank, Terrell, Tex. District No. 12: American National Bank, San Francisco, Cal. Anglo & London-Paris National Bank, San Francisco, Cal. Bank of California, N. A., San Francisco, Cal. Crocker National Bank, San Francisco, Cal. First National Bank, San Francisco, Cal. Wells-Fargo-Nevada National Bank, San Francisco, Cal. First National Bank, Portland, Oreg. Northwestern National Bank, Portland, Oreg. U. S. National Bank, Portland, Oreg. Dexter Horton National Bank, Seattle, Wash. First National Bank, Seattle, Wash. National Bank of Commerce of Seattle, Wash. Seaboard National Bank, Seattle, Wash. Seattle National Bank, Seattle, Wash. Spokane & Eastern Trust Co., Spokane, Wash. Old National Bank, Spokane, Wash. Exchange National Bank, Spokane, Wash. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

244 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. 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 1918 1915 1916 1917 1918 Chairman and Federal Reserve agent. 1 1 1 1 $10,000 $10,000 $12,000 $12,000 Governor 1 1 1 1 15,000 20,000 20,000 20,000 Deputy governor 1 11,000 Other officers 2 3 5 8 8,500 16,900 17,500 32,975 Banking department 4 13 55 160 6,100 15,260 57,700 134,283 Bookkeeping department , 3 12 17 29 3,100 11,360 16,530 27,343 Transit department 3 25 30 126 2,100 24,460 24,964 75,635 Federal Reserve agent's department. 2 3 4 15 2,500 3,680 7,100 17,400 Fiscal agency department 112 211 106,200 252,873 General 4 13 23 30 3,580 10,280 26,378 23,477 Capitalissues 3 2,095 Total 20 71 248 585 50,880 105,940 288,372 609,081 FEDERAL RESERVE BANK OF NEW YORK. Chairman and Federal Reserve agent. 1 1 1 1 $16,000 $16,000 $20,000 $20,000 Governor 1 1 1 1 30,000 15,000 30,000 30,000 Deputy governor 1 2 4 20,000 45,000 81,000 Other officers 4 6 8 17 32,800 42,000 56,200 89,400 Bfvnkfng department. .... , 47 88 287 892 60,588 97,552 301,648 945,360 Bookkeeping department 5 10 15 42 4,620 10,700 15,360 47,680 Transit department 9 57 108 446 6,430 36,480 94,480 338,430 Federal Reserve agent's department. 6 8 9,520 17,860 Fiscal agency department: Bond issue 213 228 248,284 263,640 Certificates of indebtedness 34 45,340 Government deposit 52 75 67,308 100,960 Securities 91 116,660 Partial payment 457 j 386,350 Capital issues 5 11,720 Liberty loan committee 368 634,230 General 6 9 42 22 5,510 8,460 37,440 21,540 Total 73 173 829 2,657 155,978 246,192 970,580 3,104,830 FEDERAL RESERVE BANK OF PHILADELPHIA. Chairman and Federal Reserve agent. 1 $10,000 $10,000 $10,000 $10,000 Governor 1 20,000 20,000 20,000 20,000 Other officers 7 5,000 10,200 21,250 37,000 Banking department 143 14,400 15,940 34,084 137,740 Bookkeeping department 36 3,300 9,360 18,080 47,540 Transit department 5,880 24,180 47,790 79,560 Federal Reserve agent's department.. 5,976 7,140 8,060 7,880 Fiscal agency department 23,160 102,240 General 33 12, 14,672 16,848 32,080 Total. 423 199,272 474,040 FEDERAL RESERVE BANK OF CLEVELAND (INCLUDING PITTSBURGH AND CINCIN NATI BRANCHES). Chairman and Federal Reserve agent. 1 1 $10,000 $10,000 $12,000 $15,000 Governor 1 1 18,000 20,000 20,000 20,000 Other officers 6 11 7,000 10,750 21,050 48,850 Banking department 21 129 16,900 13,430 23,800 155,418 Bookkeeping department 15 39 5,160 4,380 19,080 35,280 Transit department 73 169 1,080 23,370 52,710 130,150 Federal Reserve agent's department.. 5 10 3,500 3,780 7,820 16,080 Fiscal agency department 70 203 87,180 321,884 General 19 26 6,900 8,040 16,440 22,800 Total. 31 211 589 68,540 93,750 765,462 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

EXHIBIT N—PERSONNEL AND SALARIES. 245 Salaries of officers and employees of Federal Reserve Banks—Continued. FEDERAL RESERVE BANK OF RICHMOND (INCLUDING BALTIMORE BRANCH OPENED MAR. 1, 1918). Number of officers and employees. Salaries. Departments. 1916 i 1917 1915 1916 1917 Chairman and Federal Reserve agent. $10,000 $10, 000 $10,000 $10,000 Governor 10,000 12,000 15,000 15,000 Other officers 5,978 9,428 14,550 16.359 Banking department 12,742 13,956 22,880 76,953 Bookkeeping department 4,748 5,520 4,980 9,640 Transit department 2,278 11,599 21,954 59,485 Federal Reserve agent's department.. 945 916 2,400 7,202 Fiscal agency department 21,024 54,930 General i,439 8,819 8,540 36,810 Total. 72,238 121,328 286,379 FEDERAL RESERVE BANK OF ATLANTA (INCLUDING NEW ORLEANS, BIRMINGHAM, AND JACKSONVILLE BRANCHES). Chairman and Federal Reserve agent. $7,500 $9,000 $10,000 $10,000 Governor 9,000 9,000 10,000 10,000 Other officers 13,100 12,060 11,380 53,400 Banking department 23,928 21,828 37,690 92,770 Bookkeeping department 3,600 5,100 6,480 17,100 Transit department 1,260 15,900 20,180 53,790 Federal Reserve agent's department.. 3,200 4,380 5,220 9,180 Fiscal agency department 61,010 102,240 General 3,180 4,080 3,120 25,598 Total. 132 64,768 81,348 165,080 374,078 FEDERAL RESERVE BANK OF CHICAGO. Chairman and Federal Reserve agent. 1 1 $10,000 $10,000 $10,000 $12,000 Governor 1 1 20,000 20,000 24,000 24,000 Other officers 7 18 14,000 17,500 33,500 79,000 Banking department 36 155 21,426 31,880 47,880 180,910 Bookkeeping department 10 24 4,100 8,700 9,520 25,100 Transit department 61 124 8,700 30,240 49,280 109,160 Federal Reserve agent's department... 5 11 7,200 7,800 13,800 17;120 Fiscal agent department 166 292 215,930 354,370 General 77 189 11,134 20,985 61,130 183.800 Total.. 364 96,560 147,105 465,040 985,460 FEDERAL RESERVE BANK OF ST. LOUIS (INCLUDING MEMPHIS AND LOUISVILLE BRANCHES). Chairman and Federal Reserve agent. 1 $10,000 $10,0G0 $10,000 $10,000 Governor 1 20,000 20,000 20,000 20,000 Other officers 13 13,500 13,500 35,500 55,500 Banking department 117 12,820 17,180 44,500 123,292 Bookkeeping department 11 6,200 6,260 5,900 12,000 Transit department 60 9,660 16,140 34,620 57,540 Federal Reserve agent's department.. 5 5,900 5,900 3,340 7,920 Fiscal agency department 126 65,840 132,620 General. 51 2,820 2,820 4,920 47,000 Total., 53 385 80,900 91,800 224,620 465,872 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

246 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. Salaries of officers and employees of Federal Reserve Banks—Continued. FEDERAL RESERVE BANK OF MINNEAPOLIS. Number of officers and employees. Salaries. Departments. 1915 1916 1917 1918 1915 1916 1917 1918 Chairman and Federal Reserve agent. 1 1 1 1 $7,500 $9,000 $10,000 $10,000 1 1 1 1 15,000 15,000 18,000 18,000 1 6,000 Other officers 1 1 3 5 3,000 3,500 12,500 16,210 Banking department 10 14 30 71 11,940 15,850 29,120 56,629 Bookkeeping department 3 6 6 12 2,460 5,540 6,040 6,078 Transit department 1 29 37 78 2,000 19,460 24,040 33,243 Federal Reserve agent's department.. 3 2 2 3 5,520 4,080 4,580 5,636 47 95 51,180 65,721 Total 20 54 127 267 47,420 72,430 155,460 217,517 . FEDERAL RESERVE BANK OF KANSAS CITY (INCLUDING OMAHA AND DENVER BRANCHES). Chairman and Federal Reserve agent. 1 $7, $7,500 $7,500 $9,000 G overnor 1 7, 10,000 12,500 15,000 Other officers 12 6, 8,800 17,400 60,000 Bookkeeping department 16 6, 4,500 5,340 20,180 Transit department 139 10, 18,780 22,960 108,360 Federal Reserve agent's department.. 5 4, 4,380 7,680 5,760 Fiscal agency department 201 93,190 219,810 General 105 13,460 18,460 27,020 122,880 Total. 40 52 153 55,640 72,420 193,590 560,990 FEDERAL RESERVE BANK OF DALLAS (INCLUDING EL PASO BRANCH FOR LATTER HALF OF 1918). Chairman and Federal Reserve agent. 1 $7,500 $9,000 $10,000 $10,000 Governor 1 10,000 10,000 12,000 12,000 Other officers 8 11,000 15,000 19,700 38,200 Banking department 113 17,140 17,760 39,300 136,200 Bookkeeping department 13 1,620 5,100 6,360 12,840 Transit department 86 2,100 20,760 33,140 74, 400 Federal Reserve agent's department.. 5 7,400 3,700 3,700 10,860 Fiscal agency department 162 60,690 191,104 General 14 9,060 11,680 7,580 10,960 Total. 31 63 65,820 93,000 192,470 496,564 FEDERAL RESERVE BANK OF SAN FRANCISCO (INCLUDING SPOKANE, PORTLAND, SEATTLE, AND SALT LAKE CITY BRANCHES). Chairman and Federal Reserve agent. 1 1 $12,000 $12,000 $14,000 $14,000 Governor .' 1 1 15,000 15,000 18,000 18,000 Other officers 10 18 10,200 12,200 39,500 68,280 Banking department 77 157 14,820 30,230 101,046 190,560 Bookkeeping department 17 27 2,520 4,620 18,240 30,960 Transit department 31 64 780 11,640 28,740 62,940 Federal Reserve agent's department.. 3 10 7,000 1,620 3,420 16,224 Fiscal agency department 122 207 146,100 253,140 General 11 41 1,800 4,620 60,320 Capital issues 5 12,600 Total. 22 62 64,120 370,026 727,024 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

EXHIBIT N PERSONNEL AND SALARIES. 247 SALARIES OP OFFICERS AND EMPLOYEES OF THE FEDERAL RESERVE BOARD AS OF DECEMBER 31, 1918. OFFICE OF THE SECRETARY. J. A. Broderick, secretary $8,400 L. C. Adelson, assistant secretary 6, 000 W. T. Chapman, assistant secretary 4, 500 1 at $3,600 3, 600 1 at 2,400 2, 400 lat 1,800 1,800 1 at 1,500 1, 500 2 at 1,440 2, 880 5 at 1,320 6, 600 3 at 1,200 3, 600 1 at 1,100 1,100 1 at 1,020 1, 020 1 at 480 480 $43, 880 OFFICES OF MEMBERS OF THE BOARD. Staff- 2 at $2,900 5, 800 lat 2,750 2,750 2 at 2,500 5,000 4 at 1,560 6,240 lat 1,320 1,320 21,110 OFFICE OF GENERAL COUNSEL. Milton C. Elliott, general counsel 10, 000 Staff: 2 at $2,400 4, 800 1 at 1,770 : 1, 770 1 at 1,440 1, 440 18, 010 DIVISION OF AUDIT AND EXAMINATION. J. A. Broderick, chief examiner (secretary of Federal Reserve Board). L. C. Adelson, assistant chief examiner (assistant secretary of Federal Re serve Board). Wm. M. Imlay, fiscal agent $3, 600 Examiners: John A. Will. 5, 000 S. G. Sargent ' 5, 000 James F. Hereon 4, 200 W. W. Paddock 4, 200 W. E. Walter 4, 200 George L. Hamilton 3, 600 W. J. Donald 3, 600 —• 33,400 i Sept. 16, 1918, appointed also chief of department of examination of Federal Reserve Bank of San Francisco in addition to his duties as Federal Reserve examiner. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

248 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. Assistant examiners: lat $2,700 $2,700 lat 2,100. 2,100 2 at 2,000. 4,000 2 at 1,800. 3,600 lat 1,500. 1, 500 $13, 900 Office staff: 1 at $1,800. 1, 800 2 at 1,440 2, 880 2 at 1,320 2,640 1 at 1,200 1, 200 lat 720 720 9,240 DIVISION OF REPORTS AND STATISTICS. Morris Jacobson, statistician 5, 400 Staff: lat $3,000 3,000 2 at 2,250 4,500 lat 1,920 1, 920 4 at 1,800. ' 7,200 lat 1,560. 1,560 lat 1,520. 1,520 lat 1,500. 1,500 2 at 1,400. 2,800 7 at 1,200 8,400 lat 1,100 1,100 4 at 1,000 4,000 lat 900 900 lat 840. 840 lat 10 per week 520 45,160 DIVISION OF ANALYSIS AND RESEARCH. H. Parker Willis, director 5,000 Staff: lat $2,000 2,000 lat 1,800 1,800 2 at 1,440 2,880 lat 1,200 1,200 lat 1,000 1,000 lat 720^ 720 3 at 500 Part time employees. 1,500 lat 400 400 lat 300 300 16, 800 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

EXHIBIT N PERSONNEL AND SALARIES. 249 DIVISION OF FEDERAL RESERVE ISSUE AND REDEMPTION. Williard E. Buell, chief of the division $2, 750 Staff: 1 at $2,020 2, 020 lat 1,440 1,440 1 at 1,320 1, 320 2 at 1,080 2,160 4 at 1,020 4, 080 14 at 900 • 12, 600 1 at 720 720 — $27, 090 DIVISION OF FOREIGN EXCHANGE. Frederick I. Kent, director. Staff: lat $4,000 4,000 2 at 3,000 6, 000 1 at 1,900 .* 1, 900 2 at 1,800 3, 600 1 at 1,380. 1, 380 1 at 1,320 1, 320 2 at 1,300 2, 600 17 at 1,200 20, 400 1 at 1,100 1,100 2 at 1,020 2,040 11 at 1,000 11, 000 2 at 960 1, 920 21 at 900 18, 900 5 at 840 4, 200 6 at 780 4, 680 2 at 750 1, 500 7 at 720 5, 040 3 at 600 1, 800 2 at 540 1, 080 1 at 480 480 1 at 360 360 95,300 MESSENGERS. 1 at $1,100 1,100 1 at 1,000 1, 000 6 at 960 , 5, 760 1 at 840 840 8,700 CHARWOMEN. 3 at $312 936 Total 333,526 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

250 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. SALARIES OF NATIONAL BANK EXAMINERS. [Effective in the year ending Dec. 31, 1918.] Stephen L. Newnham, supervising examiner, not assigned to any Federal Reserve District $5,000 DISTRICT NO. 1—BOSTON. (394 national member banks.) Daniel C. Mulloney, chief examiner '... $6, 500 1 examiner, at $3,900; 1 examiner, at $3,600; 1 exanimer, at $3,300; 1 examiner, at $3,000; 2 examiners, at $2,700 19, 200 25,700 DISTRICT NO. 2—NEW YORK. (623 national member banks.) William P. Malburn, chief examiner 15,000 1 examiner, at $6,000; 1 examiner, at $4,500; 1 examiner, at $3,900; 2 examiners, at $3,600; 3 examiners, at $3,300; 4 examiners, at $3,000 43, 500 58,500 DISTRICT NO. 3—PHILADELPHIA. (633 national member banks.) Edward I. Johnson, chief examiner 8, 500 2 examiners, at $4,500; 1 examiner, at $3,900; 1 examiner, at $3,600; 1 examiner, at $3,300; 3 examiners, at $3,000; 1 examiner, at $2,700; 1 examiner, at $2,400 33, 900 42,400 DISTRICT NO. 4—CLEVELAND. (749 national member banks.) Silas H. L. Cooper, chief examiner 8, 500 4 examiners, at $4,200; 1 examiner, at $3,900; 1 examiner, at $3,600; 1 examiner, at $3,000; 1 examiner, at $2,700; 1 examiner, at $2,400.. 32,400 40,900 DISTRICT NO. 5—RICHMOND. (529 national member banks.) James K. Doughton, chief examiner 7, 500 1 examiner, at $6,500; 2 examiners, at $3,600; 3 examiners, at $3,300; 3 examiners, at $3,000; 1 examiner, at $2,700; 3 examiners, at $2,400 42, 500 50,000 DISTRICT NO. 6—ATLANTA. (373 national member banks.) Elmore F. Higgins, chief examiner 7, 500 2 examiners, at $3,600; 1 examiner, at $3,300; 1 examiner, at $3,000; 2 examiners, at $2,700; 1 examiner, at $2,400 21, 300 28,800 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

EXHIBIT N PERSONNEL AND SALARIES. 251 DISTRICT NO. 7—CHICAGO. (1,045 national member banks.) Sherrill Smith, chief examiner $12,000 1 examiner, at $5,000; 2 examiners, at $4,200; 1 examiner, at $3,900; 4 examiners, at $3,600; 4 examiners, at $3,300; 3 examiners, at • $3,000; 1 examiner, at $2,700; 2 examiners, at $2,400 61, 400 $73, 400 DISTRICT NO. 8—ST. LOUIS. (470 national member banks.) Joseph M. Logan, chief examiner 8, 000 2 examiners, at $4,200; 1 examiner, at $3,600; 1 examiner, at $3,300; 1 examiner, at $3,000; 3 examiners, at $2,700 26, 400 34,400 DISTRICT NO. 9—MINNEAPOLIS. (797 national member banks.) Fred Brown, chief examiner 6, 500 2 examiners, at $4,200; 2 examiners, at $3,900; 2 examiners, at $3,300; 1 examiner, at $3,000; 2 examiners, at $2,700; 3 examiners, at $2,400 38,400 44,900 DISTRICT NO. 10—KANSAS CITY. (968 national member banks.) Horace R. Gaither, chief examiner 6, 500 1 examiner, at $4,200; 3 examiners, at $3,900; 1 examiner, at $3,600; 1 examiner, at $3,300; 3 examiners, at $3,000; 2 examiners, at $2,700 37, 200 43, 700 DISTRICT NO. 11—DALLAS. (632 national member banks.) Richard H. Collier, chief examiner 7, 000 1 examiner, at $3,900; 1 examiner, at $3,600; 2 examiners, at $3,300; 1 examiner, at $3,000; 2 examiners, at $2,400 21,900 28, 900 DISTRICT NO. 12—SAN FRANCISCO. (562 national member banks.) Walter E. Wilcox, chief examiner 7, 500 3 examiners, at $4,500; 4 examiners, at $3,000; 2 examiners, at $2,700; 2 examiners, at $2,400 35, 700 43, 200 Total. 519, 800 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

252 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. RECAPITULATION. Examining staff: Chief examiners— At $15,000 per annum 1 At $12,000 per annum 1 At $8,500 per annum 2 At $8,000 per annum 1 At $7,500 per annum 3 At $7,000 per annum 1 At $6,500 per annum 3 Total chief examiners 12 Salaries, chief examiners $101, 000 Other examiners— At $6,500 per annum 1 At $6,000 per annum 1 At $5,000 per annum l 2 At $4,500 per annum 6 At $4,200 per annum 11 At $3,900 per annum 11 At $3,600 pre annum 16 At $3,300 per annum 19 At $3,000 per annum 26 At $2,700 per annum - 17 At $2,400 per annum 15 Total other examiners 125 Salaries, other examiners 418, 800 Total examing staff „ 137 Total salaries 519,800 i Includes 1 supervising examiner. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

EXHIBIT 0 DIRECTORY. 253 Exhibit O.—DIRECTORY OP THE FEDERAL RESERVE BOARD AND FEDERAL RESERVE RANKS. FEDERAL RESERVE BOARD. EX OFFICIO MEMBERS. W. P. G. HARDING, Governor. CARTER GLASS, ALBERT STRAUSS, Vice Governor. Secretary of the Treasury, Chairman. ADOLPH C. MILLER. JOHN SKELTON WILLIAMS, CHARLES S. HAMLIN. Comptroller of the Currency. J. A. ERODE RICK, Secretary. M. C. ELLIOTT, General Counsel. L. C. ADELSON H. PARKER WILLIS, Assistant Secretaries. Director, Division of \Y. T. CHAPMAN, Analysis and Research. W. M. IMLAY, Fiscal Agent. F. I. KENT, M. JACOBSON, Statistician. Director, Division of Foreign Exchange. OFFICERS AND DIRECTORS OF FEDERAL RESERVE BANKS. DISTRICT NO. 1—FEDERAL RESERVE BANK OF BOSTON. [Frederic H. Curtiss, chairman and Federal Reserve agent. -Vllen Hollis, deputy chairman. Chas. A. Morss, governor.] Director. Residence. jTerm expires. Class A: Thomas P. Beal Edward S. Kennard Rumford, Me Dec. 31,1921 Thos. W. Farnam." New Haven, Conn.. Dec. 31,1919 Class B: Philip R. Allen East Walpole, Mass. Dec. 31,1920 Chas. G. Washburn Worcester, Mass Dec. 31,1921 Edmund R. Morse Proctor, Vt Dec. 31,1919 Class C: Frederic H Curtiss Boston, Mass Dec. 31,1920 Allen Hollis Concord, N. H Dec. 21.1921 Jesse H. Metcalf Providence, R. I Dec. 31,1919 DISTRICT NO. 2—FEDERAL RESERVE BANK OF NEW YORK. [Pierre Jay, chairman and Federal Reserve agent. George Foster Peabody, deput; r chairman. Benjamin Strong, jr., governor.] Class A: William Woodward New York, N. Y Dec. 31,1919 R. H. Treman Ithaca, N. Y Dec. 31,1920 Charles Smith Oneonta, N. Y Dec. 31,1921 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. 31,1921 Class C. Pierre Jay New York, N. Y Dec. 31,1919 George Foster Peabody Lake George, N. Y Dec. 31,1921 W. L, Saunders New York, N. Y Dec. 31,1920 DISTRICT NO. 3—FEDERAL RESERVE BANK OF PHILADELPHIA. [Richard L. Austin, chairman and Federal Reserve agent. H. B. Thompson, deputy chairman. E. P. Passmore, governor.] Class A: Joseph Wayne, jr Philadelphia, Pa.. Dec. 31,1920 Francis Douglas Wiikes-Barre, Pa. Dec. 31,1921 M. J. Murphy Clarks Green, Pa.. Dec. 31,1919 Class B: A. B. Johnson Philadelphia, Pa.. Dec. 31,1919 E. S.Stuart do.. Dec. 31,1920 Chas. K. Haddon... Camden, N. J Dec. 31,1921 Class C. Richard L. Austin.. Philadelphia, Pa. Dec. 31,1920 H. B. Thompson Wilmington, Del. Dec. 31,1919 Charles C. Harrison. Philadelphia, Pa. Dec. 31,1921 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

254 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. 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. Residence. Term expires. Class A: W. S. Rowe Cincinnati, Ohio Dec. 31,1919 0. N. Sams Hillsboro, Ohio Dec. 31,1921 Robert Wardrop Pittsburgh, Pa . Dec. 31,1920 Class B: R. P. Wright Erie, Pa Dec. 31,1919 John Stambaugh Youngstown, Ohio Dec. 31,1921 T. A. Combs Lexington, Ky Dec. 31,1920 Class Cr H. P. Wolfe Columbus, Ohio Dec. 31,1921 Lyman H. Treadway Cleveland, Ohio Dec. 31,1919 D. C.Wills do Dec. 31,1920 DISTRICT NO. 4—PITTSBURGH BRANCH OF THE FEDERAL RESERVE BANK OF CLEVE LAND. [George De Camp, manager.] Chas. W. Brown.. Pittsburgh, Pa. Dec. 31,1919 James D. Callery.. do..\ Do. T. H. Given do Do. R. B.Mellon do Do. George De Camp.. do Do,. DISTRICT NO. 4—CINCINNATI BRANCH OF THE FEDERAL RESERVE BANK OF CLEVE LAND. [L. W. Manning, manager.] Judson Harmon Cincinnati, Ohio Dec. 31,1919 .. ..do Do. W.C.Procter do Do. W. S. Rowe do Do. L. W. Manning do Do. DISTRICT NO. 5—FEDERAL RESERVE BANK OF RICHMOND. [Caldwell Hardy, chairman and Federal Reserve agent. James A. Moncure, deputy chairman. George J. Seay, governor.] Class A: J. F.Bruton Wilson, N. C Dec. 31,1919 Edwin Mann Bluefield, W. Va Dec. 31,1920 Chas. E. Rieman Baltimore, Md , ... . Dec. 31,1921 Class B: James F. Oyster Washington, D. C Dec. 31,1919 D.R. Coker.. Hartsville, S. C Dec. 31 1920 Edmund Strudwick Richmond, Va Dec. 31^ 1921 Class C: James A. Moncure do Dec. 31,1919 Caldwell Hardy do Dec. 31,1920 Howard Bruce Baltimore, Md Dec. 31,1921 DISTRICT NO. 5—BALTIMORE BRANCH OF THE FEDERAL RESERVE BANK OF RICHMOND. [M. M. Prentis, manager.] M. M. Prentis Baltimore, Md Dec. 31,1919 Chas. C. Homer do Do. William Ingle do Do. Waldo Newcomer do Do. H. B. Wilcox do ^ Do. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

EXHIBIT 0 DIRECTORY. 255 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: John K. Ottley Atlanta, Ga Dec. 31,1921 F. W. Foote Hattiesburg, Miss Dec. 31,1919 P. R. Kittles Sylvania, Ga . . . Dec. 31,1920 Class B: J. A. McCrary Decatur, Ga Dec. 31,1921 W. H. Hartford Nashville, Tenn . Dec. 31,1919 Jas. E. Zunts New Orleans, La Dec. 31,1920 Class C: M. B. Wellborn Annifiton, Ala ... Dec. 31,1920 Edward T. Brown Atlanta, Ga Dec. 31,1921 W. H. Kettig Birmingham. Ala. Dec. 31,1919 DISTRICT NO. 6—NEW ORLEANS BRANCH OF THE FEDERAL RESERVE BANK OF ATLANTA. [James E. Zunts, chairman. P. H. Saunders, vice chairman. Marcus Walker, manager.] J. P. Butler, jr New Orleans, La.. Dec. 31,1919 John E. Bouden, jr. do Do. P. H. Saunders do Do. Frank Roberts Lake Charles, La.. Do. H. B. Lightcap Jackson, Miss Do. A. P. Bush Mobile, Ala Do. James E. Zunts New Orleans, La.. Do. DISTRICT NO. 6.—BIRMINGHAM BRANCH OF THE FEDERAL RESERVE BANK OF ATLANTA. [A. E. Walker, manager.] W. H. Kettig Birmingham, Ala. Dec. 31,1919 Oscar Wells I do Do. T. O. Smith ! do Do. W. W. Crawford \ do Do. John H. Frye I do Do. DISTRICT NO. 6.—JACKSONVILLE BRANCH OF THE FEDERAL RESERVE BANK OF ATLANTA. [Geo. R. De Saussure, manager.] John C. Cooper Jacksonville, I'la Dec. 31,1919 E. W. Lane do ! Do. Bion H. Barnett do ! Do. ' Giles L. Wilson do i Do. Fulton Saussy do ' . ...j Do. i DISTRICT NO. 7.—FEDERAL RESERVE BANK OF CHICAGO. [William. A. Heath, chairman and Federal Reserve agent. James Simpson, deputy chairman. James B. McDougal, governor.] Class A: Geo. M. Reynolds. Chicago, 111 Dec. 31,1921 J. B. Forgah do Dec. 31,1919 E. L. Johnson Waterloo, Iowa Dec. 31,1920 Class B: JohnW. Blodgett. Grand Rapids, Mich. Dec. 31,1919 Albert R. Erskine. South Bend, Ind Dec. 31,1920 A.H.Vogel Milwaukee, Wis Dec. 31,1921 Class C: Wm, A. Heath.... Evanston, 111 Dec. 31,1921 James Simpson Chicago, 111 Dec. 31,1920 E. T. Meredith.... Des Moines, Iowa. Dec. 31,1919 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

256 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. DISTRICT NO. 7.—DETROIT BRANCH OF THE FEDERAL RESERVE BANK OF CHICAGO. [R. B. Locke, manager.] Director. Residence. Term expires. John Ballantyne Detroit, Mich Dec. 31,1919 Emory W. Clark do - Do. do Do. Chas. H. Hodges do Do. R. B. Locke do Do. DISTRICT NO. 8.—FEDERAL RESERVE BANK OF ST. LOUIS. [William McC. Martin, chairman and Federal Reserve agent; John W. Boehne, deputy chairman; David C. Biggs, governor.] Class A: Walker Hill St. Louis, Mo. Dec. 31,1920 J. C. Utterback Paducah, Ky. Dec. 31,1921 Sam A.Ziegler Albion, 111 Dec. 31,1919 Class B: David C. Biggs.... St. Louis, Mo Dec. 31,1921 W. B. Plunkett.... Little Rock, Ark. Dec. 31,1919 Leroy Percy Greenville, Miss.. Dec. 31,1920 Class C: Wm. McC. Martin. St. Louis, Mo... Dec. 31,1921 John W. Boehne... Evansville, Ind. Dec. 31,1920 C. P. J. Mooney Memphis, Tenn. Dec. 31,1919 DISTRICT NO. 8.—LOUISVILLE BRANCH OF THE FEDERAL RESERVE BANK OF ST LOUIS. [W. P. Kincheloe, manager.] Geo. W. Norton Louisville, Ky Dec. 31,1919 W. C. Montgomery. Elizabethtown, Ky. Do. W. P. Kincheloe.... Louisville, Ky Do. F. M. Sackett do Do. C. E.Hoge Frankfort, Ky Do. DISTRICT NO: 8 -MEMPHIS BRANCH OF THE FEDERAL RESERVE BANK OF ST. LOUIS. [John J. Heflin, manager.] R. Brinkley Snowden. Memphis, Tenn. Dec. 31,1919 John D. McDowell do Do. John J. Heflin do Do. T.K.Riddick do Do. S. E. Ragland do Do. DISTRICT NO. 8.--LITTLE ROCK BRANCH OF THE FEDERAL RESERVE BANK OF ST. LOUIS. [John M. Davis, manager.] Ed. Cornish Little Rock, Ark Dec. 31,1919 John M. Davis do Do. Moorhead Wright do Do. G.W.Rogers.. do Do. C. A. Pratt do Do. DISTRICT NO. 9.—FEDERAL RESERVE BANK OF MINNEAPOLIS, [John H. Rich, chairman and Federal Reserve agent; Wm. H. Lightner, deputy chairman; Theodore Wold, governor.] Class A: E. W. Decker.. Minneapolis, Minn Dec. 31,1919 L. B. Hanna Fargo, N. Dak Dec. 31,1920 W. C. McDowell Marion, N. Dak Dec. 31,1921 Class B: F. R. Bigelow St. Paul, Minn Dec. 31,1919 F. P. Hixon La Crosse, Wis Dec. 31,1921 N. B. Holter Helena, Mont Dec. 31,1920 Class C: John H. Rich Minneapolis, Minn Do. W. H. Lightner St. Paul, Minn Dec. 31,1921 John W. Black Houghton, Mich Dec. 31,1919 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

EXHIBIT 0 DIRECTORY. 257 DISTRICT NO. 10.—FEDERAL RESERVE BANK OF KANSAS CITY. [Asa E. Ramsay, chairman and Federal Reserve agent; F. W. Fleming, deputy chairman; J. Z. Miller, jr., governor.] Director. Residence. Term expires. Class A: W. J. Bailey Atchison, Kans Dec. 31,1919 C. E. Burnham .- Norfolk, Nebr Dec. 31,1920 J. C. Mitchell Denver, Colo Dec. 31,1921 Class B: T. C. Bvrne Omaha, Nebr Do. Harry W. Gibson Muskogee, Okla Dec. 31,1920 M. L. McClurc Kansas City, Mo Dec. 31,1919 Class C: F. W. Fleming do Do. Asa E. Ramsay do Dec. 31,1920 R. H. Malone Denver, Colo Dec. 31,1921 DISTRICT NO. 10.—DENVER BRANCH OF THE FEDERAL RESERVE BANK OF KANSAS CITY. [C. A. Burkhardt, manager.] C. C. Parks Denver, Colo Dec. 31,1919 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 THE FEDERAL RESERVE BANK OF KANSAS CITY. [O. T. Eastman, manager.] Luther Drake. Omaha, Nebr Dec. 31,1919 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.] Class A: John T. Scott Houston, Tex Dec. 31,1921 E. K. Smith Shreveport, La Dec. 31,1920 B. A. McKinnev Durant, Okla Dec. 31,1919 Class B :m Fort Worth, Tex Do. Frank Kell Wichita Falls, Tex Dec. 31,1921 J. J. Culbertson Paris, Tex Dec. 31,1920 Class C; W. F. Ramsev Dallas, Tex Do. W. B. Newsome do Dec. 31,1921 II. O. Wooten Abilene, Tex Dec. 31,1919 DISTRICT NO. 11.—EL PASO BRANCH OF THE FEDERAL RESERVE BANK OF DALLAS. [Sam R. Lawder, manager.] U. S. Stewart El Paso, Tex Dec. 31,1919 A.F.Kerr do Do. do Do. W.W.Turney do Do. A.P.Coles do Do. 100823°—19 17 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

258 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. Mcintosh San Francisco, Cal Dec. 31,1919 J. E. Fishburn Los Angeles, Cal Dec. 31,1920 M, A. Buchan... _ Palo Alto, Cal Dec. 31,1921 Class B: A. B. 0. Dohrmann San Francisco, Cal Dec. 31,1920 J. A. McGregor do Dec. 31,1921 E.H.Cox do Dec. 31,1919 Class C: John Perrin do Dec. 31,1920 Edward E. Elliott Berkeley, Cal Dec. 31,1919 Walton N. Moore San Francisco, Cal Dec. 31,1921 DISTRICT NO. 12—PORTLAND BRANCH OF THE FEDERAL RESERVE BANK OF SAN FRANCISCO. [C. L . Lamping, acting manager.] E. A. Cookingham Portland, Oreg. Dec. 31,1919 do Do. C. L. Lamping do Do. Nathan Strauss do Do. do Do. DISTRICT NO. 12—SEATTLE BRANCH OF THE FEDERAL RESERVE BANK OF SAN FRANCISCO. [C'. J. Shepherd, manager.] M. F. Backus Seattle, Washington Dec. 31,1919 do Do. C. J. Shepherd do Do. C.H.Clarke do Do. Chas. E. Peabody. do Do. DISTRICT NO. 12—SPOKANE BRANCH OF THE FEDERAL RESERVE BANK OF SAN FRANCISCO. [Chas. A. McLean, manager.] D.W.Twohy Spokane, Wash. Dec. 31,1919 R.L.Rutter do Do. Chas. A. McLean.. do Do. Peter McGregor... do Do. G.I.Toevs do Do. DISTRICT NO. 12—SALT LAKE CITY BRANCH OF THE FEDERAL RESERVE BANK OF SAN FRANCISCO. [Chas. H. Stewart, manager.] L. H. Farnsworth... Dec. 31,1919 Chas. H. Stewart Do. Chapin A. Day Ogden, Utah Do. G.G.Wright Idaho Falls, Utah Do. Lafayette Hanchett. Salt Lake City, Utah.. Do. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

EXHIBIT P FEDERAL ADVISORY COUNCIL. 259 Exhibit P.—FEDERAL ADVISORY COUNCIL. District No. 1.—Daniel G. Wing, president First National Bank, Boston, Mass. District No. 2.—A. B. Hepburn, chairman advisory board, Chase National Bank, 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.—Joseph G. Brown, president City National Bank, Raleigh, N. 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.—C. T. Jaffray, president First and Security National Bank, Minne apolis, 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.—A. L. Mills, president First National Bank Portland, Oreg. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Exhibit Q.—EXPORTS OF COIN, BULLION, AND CURRENCY. Amounts of licenses granted by the Federal Reserve Board during the period Sept. 7, 1917, to Dec. 31 j 1918, covering exports from the United States of coin, bullion and currency. United Own Other Gold. Silver. States currency. currency. Total. currency. $25.00 $9,800.00 $11,351.00 $90,261.00 $111,437.00 54,713.00 5,096,855.00 Si, 650,230. 66 442,991.94 156,172.00 7,400,961.94 Holland 357.50 39,134.16 2,550.00 42,041.66 Italy 200.00 200. 00 449,185.14 5,000.00 14,287.50 392,073.64 860,546.28 438. 00 438.00 370. 00 27,000.00 80,908.50 108,278.50 4,445,183.00 4,445,183.00 20,286. 41 i80,675.66 200,961.41 247,000.00 100. 00 8,708. 00 8,000. 00 263,808. 00 V nited Kingdom 920. 97 44,439,014.99 1,322,906.00 606,701.67 3,893,942.00 50,263,485.63 Other European points 168,203. 80 168,203. 80 Total Europe... 4,501,769. 47 50,241,855.13 3,005,236.00 1,224,807.18 4,891,877.44 63,865,545.22 46,240.00 48,369,817.23 10,306.00 1,020.00 56l7671. 52 48,989,054.75 1,707,639.30 537,500.00 400.00 3,002.50 370,747.00 2,619,288. 80 3,885,315. 00 233,242,753.35 310. 00 2,785,675.52 239,914,053.87 1,344,143.70 500,000. 00 60,500.00 84,972.93 598,790.00 2,588,406. 63 Other Asiatic points.. 357,962.50 4,328,179.76 55,000.00 61,500. 00 31,250. 00 4,833,892.26 7,341,300.50 286,978,250.34 126,206.00 150,805.43 4,348,134.04 298,944,696.31 17,506,422.95 10,834. 72 22,750.00 17,353.60 30,370. 00 17,587,731.27 285,000.00 43.60 285,043. 60 695. 00 2,570. 00 60, bob. 66 1,321.00 64,586. 00 Chile 15,551,031.35 3,296.70 15,554,328. 05 2,206,105. 24 50,000.00 534,800.00 192.25 40,000.00 2,831,097.49 400.00 73,000.00 5.00 73,405. 00 4,342,149.57 615,000.00 71,600.00 250. 00 5,028,999.57 216,200.00 1,159.00 217,359.00 1,299,786.94 1,202.00 1,300,988.94 Other South Ameri- 127,950.00 5,169.00 5,000.00 138,119.00 Total, South America 41,319,541.05 284,773.72 ' 1,310,550.00 96,173.15 70,620.00 43,081,657.92 32,176,449.56 i 5,420,443.63 2,300,066.85 15,184,613.32 , 531,074.56 55,612,647.92 475. 00 13,300.00 i 6*17.50 250. 00 14,642. 50 20.00 1,400.00 4,150.66 33,724.95 10,815.88 50,110. 83 43,285,862.46 7,533,148.27 16,859,866.22 941,873. 66 51,445. 81 68,672,196.42 3,108. 35 324,161.00 | 2,230,500.00 11,075.00 237,819.10 2,806,663.45 West Indies i 57,294.05 478,940.69 48,211,192.52 4,165. 56 148,751. 00 48,900,343.82 1,473.78 36,000.0C 1,316,000.00 1,353,473.78 Miscellaneous 1,220. 0C 3,727.0C 728,985.00 150. 00 1,025,022.66 1,759,104.00 Total, other 75,525,903.20 [ 13,811,120.59 71,650,760.59 16,176,219.99 2,005,178.35 179,169,182.72 Total 128,688,514.22 J351,315,999.78 176,092,752.59 17,648,005.75 11,315,809.83 K«* Ofil .0X2.17 260 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

EXHIBIT R AMENDMENTS TO FEDERAL RESERVE ACT. 261 Exhibit R.—AMENDMENTS TO THE FEDERAL RESERVE ACT. [PUBLIC—No. 218—65TH CONGRESS.] [H. R. 11283.] AN ACT To amend and reenact sections four, eleven, sixteen, nineteen, and twenty-two of the act approved December twenty-third, nineteen hundred and thirteen, and known as the Federal reserve act, and sections fifty-two hundred and eight and fifty-two hundred and nine, Revised Statutes. Be it enacted by the Senate and Hpupe of Representatives of the United States of America in Congress assembled, That section four of the act approved December twenty-third, nineteen hundred and thirteen, known as the Federal reserve act, be amended and reenacted by striking out that part of such section which reads as follows: "Directors of Class A and Class B shall be chosen in the following manner: "The chairman of the board of directors of the Federal reserve bank of the district in which the bank is situated or, pending the appointment of such chairman, the organization committee shall classify the member banks of the district into three general groups or divisions. Each group shall contain as nearly as may be one-third of the aggregate number of the member banks of the district, and shall consist, as nearly as may be, of banks of similar capitalization. The groups shall be designated by number by the chairman. "At a regularly called meeting of the board of directors of each member bank in the district it shall elect by ballot a district reserve elector and shall certify his name to the chairman of the board of directors of the Federal reserve bank of the district. The chairman shall make lists of the district reserve electors thus named by banks in each of the aforesaid three groups and shall transmit one list to each elector in each group. "Each member bank shall be permitted to nominate to the chairman one candidate for director of Class A and one candidate for director of Class B. The candidates so nominated shall be listed by the chairman, indicating by whom nominated, and a copy of said list shall, within fifteen days after its completion, be furnished by the chairman to each elector. "Every director shall, within fifteen days after the receipt of the said list, certify to the chairman his first, second, and other choices of a director of Class A and Class B, respectively, upon a preferential ballot, on a form furnished by the chairman of the board of directors of the Federal reserve bank of the district. Each elector shall make a cross opposite the name of the first, second, and other choices for a director of Class A and for a director of Class B, but shall not vote more than one choice for any one candidate, " and by substituting therefor the following: "Directors of Cla^s A and Class B shall be chosen in the following manner: "The Federal Reserve Board shall classify the member banks of the district into three general groups or divisions, designating each group by number. Each group shall consist as nearly as may be of banks of similar capitalization. Each member bank shall be permitted to nominate to the chairman of the board of directors of the Federal reserve bank of the district one candidate for director of Class A and one candidate for director of Class B. The candidates so nominated shall be listed by the chairman, indicating by whom nominated, and a copy of said list shall, within fifteen days after its completion, be furnished by the chairman to each member bank. Each member bank by a resolution of the board or by an amendment to its by-laws shall authorize its president, cashier, or some other officer to cast the vote of the member bank in the elections of Class A and Class B directors. " Within fifteen days after receipt of the list of candidates the duly authorized officer of a member bank shall certify to the chairman his first, second, and other choices for director of Class A and Class B, respectively, upon a preferential ballot updh a form Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

262 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. furnished by the chairman of the board of directors of the Federal reserve bank of the district. Each such officer shall make a cross opposite the name of the first, second, and other choices for a director of Class A and for a director of Class B, but shall not vote more than one choice for any one candidate. No officer or director of a member bank shall be eligible to serve as a Class A director unless nominated and elected by banks which are members of the same group as the member bank of which he is an officer or director. " Any person who is an officer or director of more than one member bank shall not be eligible for nomination as a Class A director except by banks in the same group as the bank having the largest aggregate resources of any of those of which such person is an officer or director." SEC. 2. That section eleven (k) of the Federal reserve act be amended and reenacted to read as follows: " (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, administrator, registrar of stocks and bonds, guardian of estates, assignee, receiver, committee of estates of lunatics, or in any other fiduciary capacity in which State banks, trust companies, or other corporations which come into competition with national banks are permitted to act under the laws of the State in which the national bank is located. " Whenever the laws of such State authorize or permit the exercise of any or all of the foregoing powers by State banks, trust companies, or other corporations which compete with national banks, the granting to and the exercise of such powers by national banks shall not be deemed to be in contravention of State or local law within the meaning of this act. "National banks exercising any or all of the powers enumerated in this subsection shall segregate all assets held in any fiduciary capacity from the general assets of the bank and shall keep a separate set of books and records showing in proper detail all transactions engaged in under authority of this subsection. Such books and records shall be open to inspection by the State authorities to the same extent as the books and records of corporations organized under State law which exercise fiduciary powers, but nothing in this act shall be construed as authorizing the State authprities to examine the books, records, and assets of the national bank which are not held in trust under authority of this subsection. "No national bank shall receive in its trust department deposits of current funds subject to check or the deposit of checks, drafts, bills of exchange, or other items for collection or exchange purposes. Funds deposited or held in trust by the bank await ing investment shall be carried in a separate account and shall not be used by the bank in the conduct of its business unless it shall first set aside in the trust department United States bonds or other securities approved by the Federal Reserve Board. "In the event of the failure of such bank the owners of the funds held in trust for investment shall have a lien on the bonds or other securities so set apart in addition to their claim against the estate of the bank. "Whenever the laws of a State require corporations acting in a fiduciary capacity to deposit securities with the State authorities for the protection of private or court trusts, national banks so acting shall be required to make similar deposits, and se curities so deposited shall be held for the protection of private or court trusts as pro vided by the State law. "National banks in such cases shall not be required to execute the bond usually required of individuals if State corporations under similar circumstances are exempt from this requirement. "National banks shall have power to execute such bond when so required by the laws of the State. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

EXHIBIT R AMENDMENTS TO FEDERAL RESERVE ACT. 263 11 In any case in which the laws of a State require that a corporation acting as trustee, executor, administrator, or in any capacity specified in this section, shall take an oath or make an affidavit, the president, vice president, cashier, or trust officer of such national bank may take the necessary oath or execute the necessary affidavit. "It shall be unlawful for any national banking association to lend any officer, direc tor, or employee any funds held in trust under the powers conferred by this section. Any officer, director, or employee making such loan, or to whom such loan is made, may be fined not more than $5,000, or imprisoned not more than five years, or may be both fined and imprisoned, in the discretion of the court. *' In passing upon applications for permission to exercise the powers enumerated in this subsection, the Federal Reserve Board may take into consideration the amount of capital and surplus of the applying bank, whether or not such capital and surplus is sufficient under the circumstances of the case, the needs of the community to be served, and any other facts and circumstances that seem to it proper, and may grant or refuse the application accordingly: Provided, That no permit shall be issued to any national banking association having a capital and surplus less than the capital and surplus required by State law of State banks, trust companies, and corporations exercising such powers." SEC. 3. That the ninth paragraph of section sixteen of the Federal reserve act, as amended by the acts approved September seventh, nineteen hundred and sixteen, and June twenty-first, nineteen hundred and seventeen, be further amended and reenacted so as to read as follows: "In order to furnish suitable notes for circulation as Federal reserve notes, the Comptroller of the Currency shall, under the direction of the Secretary of the Treas ury, cause plates and dies to be engraved in the best manner to guard against counter feits and fraudulent alterations, and shall have printed therefrom and numbered such quantities of such notes of the denominations of $5, $10, $20, $50, $100, $500, $1,000, $5,000, $10,000 as may be required to supply the Federal reserve banks. Such notes shall be in form and tenor as directed by the Secretary of the Treasury under the provisions of this act and shall bear the distinctive numbers of the several Federal reserve banks through which they are issued." SEC 4. That paragraphs (b) and (c) of section nineteen of the Federal reserve act, as amended by the acts approved August fifteenth, nineteen hundred and fourteen, and June twenty-first, nineteen hundred and seventeen, be further amended and reenacted to read as follows: "(b) If in a reserve city, as now or hereafter defined, it shall hold and maintain with the Federal reserve bank of its district an actual net balance equal to not less than ten per centum of the aggregate amount of its demand deposits and three per centum of its time deposits: Provided, however, That if located in the outlying districts of a reserve city or in territory added to such a city by the extension of its corporate charter, it may, upon the affirmative vote of five members of the Federal Reserve Board, hold and maintain the reserve balances specified in paragraph (a) hereof. " (c) If in a central reserve city, as now or hereafter defined, it shall hold and main tain with the Federal reserve bank of its district an actual net balance equal to not less than thirteen per centum of the aggregate amount of its demand deposits and three per centum of its time deposits: Provided, however, That if located in the outlying districts of a central reserve city or in territory added to such city by the extension of its corporate charter, it may, upon the affirmative vote of five members of the Federal Reserve Board, hold and maintain the reserve balances specified in paragraphs (a) or (b) thereof." SEC. 5. That section twenty-two of the Federal Reserve Act, as amended by the act of June twenty-first, nineteen hundred and seventeen, be further amended and reenacted to read as follows: Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

264 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. "(a) No member bank and no officer, director, or employee thereof shall hereafter make any loan or grant any gratuity to any bank examiner. Any bank officer, director, or employee violating this provision shall be deemed guilty of a misdemeanor and shall be imprisoned not exceeding one year or fined not more than $5,000, or both; and may be fined a further sum equal to the money so loaned or gratuity given. "Any examiner accepting a loan or gratuity from any bank examined by him or from an officer, director, or employee thereof shall be deemed guilty of a misdemeanor and shall be imprisoned one year or fined not more than $5,000, or both, and may be fined a further sum equal to the money so loaned or gratuity given, and shall forever thereafter be disqualified from holding office as a national bank examiner. "(b) No national bank examiner shall perform any other service for compensation while holding such office for any bank or officer, director, or employee thereof. *' No examiner, public or private, shall disclose the names of borrowers or the col lateral for loans of a member bank to other than the proper officers of such bank with out first having obtained the express permission in writing from the Comptroller of the Currency, or from the board of directors of such bank, except when ordered to do so by a court of competent jurisdiction, or by direction of the Congress of the United States, or of either House thereof, or any committee of Congress, or of either House duly authorized. Any bank examiner violating the provisions of this subsection shall be imprisoned not more than one year or fined not more than $5,000, or both. "(c) Except as herein provided, any officer, director, employee, or attorney of a member bank who stipulates for or receives or consents or agrees to receive any fee, commission, gift, or thing of value from any person, firm, or corporation, for procuring or endeavoring to procure for such person, firm, or corporation, or for any other person, firm, or corporation, any loan from or the purchase or discount of any paper, note, draft, check, or bill of exchange by such member bank shall be deemed guilty of a misdemeanor and shall be imprisoned not more than one year or fined not more than $5,000, or both. "(d) Any member bank may contract for, or purchase from, any of its directors, or from any firm of which any of its directors is a member, any securities or other property, when (and not otherwise) such purchase is made in the regular course of business upon terms not less favorable to the bank than those offered to others, or when such purchase is authorized by a majority of the board of directors not interested in the sale of such securities or property, such authority to be evidenced by the affirmative vote or written assent of such directors: Provided, however, That when any director, or firm of which any director is a member, acting for or on behalf of others, sells securities or other property to a member bank, the Federal Reserve Board by regulation may, in any or all cases, require a full disclosure to be made, on forms to be prescribed by it, of all commissions or other considerations received, and whenever such director or firm, acting in his or its own behalf, sells securities or other property to the bank the Federal Reserve Board, by regulation, may require a full disclosure of all profit realized from such sale. "Any member bank may sell securities or other property to any of its directors, or to a firm of which any of its directors is a member, in the regular course of business on terms not more favorable to such director or firm than those offered to others, or when such sale is authorized by a majority of the board of directors of a member bank to be evidenced by their affirmative vote or written assent: Provided, however, That nothing in this subsection contained shall be construed as authorizing member banks to pur chase or sell securities or other property which such banks are not otherwise authorized by law to purchase or sell. "(e) No member bank shall pay to any director, officer, attorney, or employee a greater rate of interest on the deposits of such director, officer, attorney, or employee than that paid to other depositors on similar deposits with such member bank. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

EXHIBIT R AMENDMENTS TO FEDERAL RESERVE ACT. 265 " (f) If the directors or officers of any member bank shall knowingly violate or per mit any of the agents, officers, or directors of any member bank to violate any of the provisions of this section or regulations of the board made under authority thereof, every director and officer participating in or assenting to such violation shall be held liable in his personal and individual capacity for all damages which the member bank, its shareholders, or any other persons shall have sustained in consequence of such violation." SEC. 7. That section fifty-two hundred and eight of the Revised Statutes as amended by the act of July twelfth, eighteen hundred and eighty-two, and section fifty-two hundred and nine of the Revised Statutes as amended by the acts of April sixth, eighteen hundred and sixty-nine, and July eighth, eighteen hundred and seventy, be, and the same are hereby, amended and reenacted to read as follows: " SEC. 5208. It shall be unlawful for any officer, director, agent, or employee of any Federal reserve bank, or of any member bank as defined in the act of December twenty-third, nineteen hundred and thirteen, known as the Federal reserve act, to certify any check drawn upon such Federal reserve bank or member bank unless the person, firm, or corporation drawing the check has on deposit with such Federal reserve bank or member bank, at the times such check is certified, an amount of money not less than the amount specified in such check. Any check so certified by a duly authorized officer, director, agent, or employee shall be a good and valid obligation against such Federal reserve bank or member bank; but the act of any officer, director, agent, or employee of any such Federal reserve bank or member bank in violation of this section shall, in the discretion of the Federal Reserve Board, subject such Federal reserve bank to the penalties imposed by section eleven, sub section (h), of the Federal reserve act, and shall subject such member bank if a national bank to the liabilities and proceedings on the part of the Comptroller of the Currency provided for in section fifty-two hundred and thirty-four, Revised Statutes, and shall, in the discretion of the Federal Reserve Board, subject any other member bank to the penalties imposed by section nine of said Federal reserve act for the violation of any of the provisions of said act. Any officer, director, agent, or employee of any Federal reserve bank or member bank who shall willfully violate the provisions of this section, or who shall resort to any device, or receive any fictitious obligation, directly or collaterally, in order to evade the provisions thereof, or who shall certify a check before the amount thereof shall have been regularly entered to the credit of the drawer upon the books of the bank, shall be deemed guilty of a misdemeanor and shall, on conviction thereof in any district court of the United States, be fined not more than $5,000, or shall be imprisoned for not more than five years, or both, in the discretion of the court. "SEC. 5209. Any officer, director, agent, or employee of any Federal reserve bank, or of any member bank as defined in the act of December twenty-third, nineteen hun dred and thirteen, known as the Federal reserve act, who embezzles, abstracts, or will fully misapplies any of the moneys, funds, or credits of such Federal reserve bank or member bank, or who, without authority from the directors of such Federal reserve bank or member bank, issues or puts in circulation any of the notes of such Federal reserve bank or member bank, or who, without such authority, issues or puts forth any certificate of deposit, draws any order or bill of exchange, makes any acceptance, assigns any note, bond, draft, bill of exchange, mortgage, judgment, or decree, or who makes any false entry in any book, report, or statement of such Federal reserve bank, or member bank, with intent in any case to injure or defraud such Federal reserve bank or member bank, or any other company, body politic or corporate, or any individual person, or to deceive any officer of such Federal reserve bank or member bank, or the Comptroller of the Currency, or any agent or examiner appointed to Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

266 ANNUAlr REPORT OF THE FEDERAL RESERVE BOARD. examine the affairs of such Federal reserve bank or member bank, or the Federal Reserve Board; and every receiver of a national banking association who, with like intent to defraud or injure, embezzles, abstracts, purloins, or willfully misapplies any of the moneys, funds, or assets of his trust, and every person who, with like intent, aids or abets any officer, director, agent, employee, or receiver in any violation of this section shall be deemed guilty of a misdemeanor, and upon conviction thereof in any district court of the United States shall be fined not more than $5,000 or shall be imprisoned for not more than five years, or both, in the discretion of the court. "Any Federal reserve agent, or any agent or employee of such Federal reserve agent, or of the Federal Reserve Board, who embezzles, abstracts, or willfully mis applies any moneys, funds, or securities intrusted to his care, or without complying with or in violation of the provisions of the Federal reserve act, issues or puts in cir culation any Federal reserve notes shall be guilty of a midemeanor and upon con viction in any district court of the United States shall be fined not more than $5,000 or imprisoned for not more than five years, or both, in the discretion of the court." Approved, September 26, 1918. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

PART II. REPORTS OF FEDERAL RESERVE AGENTS TO FEDERAL RESERVE BOARD. 267 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 1—BOSTON. FREDERIC H. CTTRTISS, Chairman and Federal Reserve Agent. INTRODUCTION. The past year, the second of the Nation's participation in the war, has produced marked changes in the character of the industrial and financial activities of the New England district. As the year progressed the increasing demands of the Government for carrying on the war have by degrees taken precedence over those for civilian purposes, so that on November 11, at the time of the signing of the armistice, the energies and resources of this community were largely directed and subservient to the successful prosecution of the war. During the year there have been placed in New England, througn the banks of the district, over $1,000,000,000 of Government securi ties—Treasury certificates, Liberty loans, and war-savings certifi cates, besides over $300,000,000 of Federal taxes collected. These loans and taxes have been financed where necessary through redis counts with the Federal Reserve Bank of Boston. That these sums have been raised without undue financial disturbance, and that the loaning rates for money have been kept steady and not unduly high is an indication of the satisfactory operations of the Federal Reserve Bank and the Federal Reserve system. Schedule 4 shows the fiscal operations of the Government during the year. FINANCIAL RESULTS OF OPERATION. The increased demands by member banks for rediscounts and loans to finance Government needs have brought large earnings to the Fed eral Reserve Bank. The net earnings for the year 1918 distributable, after making allowance for depreciation, amounted to $3,305,000. Dividends at the rate of 6 per cent per annum were declared on June 6, 1918, and December 5, 1918, payable to stockholding banks as of June 30, 1918, and December 31, 1918. These dividends amounted in the aggregate to $384,000. Of the surplus earnings one-half, or $1,460,500, was carried to the bank's surplus ac count, and an equal amount was set aside as a reserve for the payment of the franchise tax to the United States Government as required by the Federal Reserve Act. H J 269 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

270 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. Schedules 1 and 2 show earnings in detail as compared with the year 1917. Schedule 3 shows a comparative statement of the condition of the bank on December 31, 1917, and December 31, 1918. The important changes in the balance sheet will be referred to under the proper headings in this report, the increase in most of the items clearly indi cating the enlarged activities of the bank. GENERAL BUSINESS AND BANKING CONDITIONS IN THE DISTRICT. As the year 1918 advanced the pressure of. the Government to meet war demands became increasingly heavy. Both business men and bankers were urged to give preference to industries essential to the prosecution of the war and to Government and other essential securities, and eventually the Government needs became so great that Federal control was necessary. Early in January the Capital Issues Committee assumed jurisdiction over the issue of new securi ties, and later, through the War Industries Board and other boards, labor and material were conserved for the Government's use. Although Government regulations, price fixing, and constant de mands for money have brought unusual burdens, banks and mer chants have, with but few exceptions, made unprecedented profits. The competition for labor, skilled and unskilled, has also proved a serious problem and has forced wages to a plane hitherto unknown. Unrest and inefficiency of labor have been pronounced during this period, employees leaving one industry to go to another offering higher pay and refusing to remain steadily employed. Money rates, during the year, both time and demand, for commer cial needs, have remained practically steady at 6 per cent, being influenced by the rates charged by the Federal Reserve Bank. Rates on loans secured by Government bonds varied from 4| per cent to 5 per cent, being similarly influenced. Immediately after the armistice, the Government began canceling many of its war contracts, and the manufacturer was brought face to face with the readjustment of his business to a peace basis. Peace, however, found domestic business quite generally in a satisfactory state, low inventories being prevalent with the manufacturer, whole saler, and retailer. The large amount of raw material held by the Government, the uncertainty of the future trend of demand for raw material from foreign countries, together with the prevailing high prices both for labor and material, have resulted in a considerable slowing down of industrial activities, and are causing business to await future developments before going ahead. The demand of the Government for money to settle its contracts and to support the large Army still in camps in this country and Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 1—BOSTON. 271 overseas is so great that the banks are being called upon continuously to subscribe to war loans and have been increasing their demands for rediscounts with the Federal Reserve Bank. It is expected that after the first of the year 1919, with the accu mulation of investment money, the banks of the district will have more money to lend, but unless there should be a heavy recession in general business not looked for at the present.time rates are not ex pected to be materially lower until after the next Liberty loan. DISCOUNT OPERATIONS. The bulk of loan operations of the Federal Reserve Bank of Boston during the year 1918 was made up of borrowings on account of Government financing. As will be seen from the appended schedules, borrowings for commercial purposes have been comparatively small. Boston banks have become accustomed to borrow large amounts on notes secured by Government obligations for short periods, usually one day, whenever their reserve requirements necessitated temporary replenishing. The total loans of the Federal Reserve Bank at the end of 1917, including notes and acceptances rediscounted with other Federal Reserve Banks or sold with this bank's indorsement, amounted to about $120,000,000. OnFebruary 12,1918, this loan account had been reduced to about $62,000,000, and although later temporarily in creased , further liquidation by member banks brought the loan account down on May 16 to about $58,000,000, which was the low point of the year. During the next few weeks the Federal Reserve Bank redis counted for other Federal Reserve Banks, but these rediscounts never at one time exceeded $10,000,000. From May 16 to the end of the year there was a steady increase in the bank's loans, a material expansion being shown between June 27 and July 11, when $148,000,000 of redeposits in connection with the Federal taxes were withdrawn from member banks. Although the high point reached at that period was somewhat reduced, from August 17 there was a steady increase in the bank's loan account, owing to the withdrawal of Government funds deposited in connection with the Liberty loan, reaching $157,000,000 on November 1, when redis counts were resorted to with other Federal Reserve Banks. From that time to the end of the year this bank, in order to maintain its reserve more nearly on a parity with that of the Federal Reserve system, was obliged from time to time to rediscount member bank loans, or sell acceptances to other Federal Reserve Banks. Schedule 5 shows rediscounts with other Federal Reserve Banks. The demands for accommodation from member banks, because of Government withdrawals, were very large during this period, the loans increasing to $165,000,000 on November 12, and to $168,000,000 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

272 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. on November 28. The latter was the highest point reached during the year. It is estimated that if there had not been recourse to other Federal Reserve Banks the loans would have reached a high point of $232,000,000 on December 13. Schedules 6 and 7 and accom panying charts contain detailed figures covering all fluctuations. TRADE ACCEPTANCES. Very satisfactory progress has been made during the past year in the use of trade acceptances by the merchants in the New England district. While it is difficult to procure accurate information as to the char acter of this development, the records of the Federal Reserve Bank show a large increase in the number and volume of trade acceptances that have been offered for rediscount by the member banks of the district. Trade acceptances have for the most part been received for rediscount from the out-of-town banks, the large Boston banks as a rule not being inclined to encourage their use. On the other hand, there has been a considerable increase in the different lines of trade which have found this character of financing attractive. The bank has, as in the past, maintained a differential rate in favor of the trade acceptance as compared with the ordinary commercial bill. BANKERS' ACCEPTANCES. The past year has shown a marked growth, both in number and volume, of bankers7 acceptances created by banks in this district. While it is not practicable to show the increase in volume of accept ances created by all the banks in the district, the increase in those of national banks is shown by Schedule 8. Fully as important, however, is the satisfactory progress that has been made in creating a broader market, not only for the acceptances originating in this district, but also for those created by banks else where in the country. To encourage this distribution, during the past year, the Federal Reserve Bank has maintained differential rates between indorsed and unindorsed bills and has discouraged the direct offering of bills by the accepting banks, taking such acceptances only as rediscounts and at the discount rate ruling for other commer cial paper, while at the same time holding itself open to purchase the same bills at current rates, even though unindorsed, from brokers and other banks than the accepting banks. A differential has also been maintained by the Federal Reserve Bank between indorsed and unindorsed bills, and on bills of varying maturities, encouraging the offering of short-time bills to the Federal Reserve Bank. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 1 BOSTON. 273 To encourage brokers to handle acceptances, the Federal Reserve Bank has made advances to them on acceptances with agreements to repurchase. These advances have been made on favorable terms, and this practice has also been adopted by several of the larger Boston banks. This policy has tended to distribute acceptances more freely, not only into the portfolios of large city banks, but also to out-oftown banks, both commercial and savings. The Massachusetts sav ings banks have taken advantage of the law passed last May which allows such investments. Frequent conferences with officials of accepting banks have not only brought about a more satisfactory character of acceptance but have also been a benefit in developing a policy which has materially broad ened their market. It would appear desirable to have a policy adopted by Federal Reserve Banks with reference to bankers' acceptances, so that on the date of payment the proceeds would be available as reserve funds by the holding bank. During the year the number of accepting national banks has increased from 32 to 40 and, as will be seen by Schedule 10, six addi tional banks have been given the special privilege of accepting up to 100 per cent of their capital and surplus. UNITED STATES SECURITIES. The holdings of United States securities have shown several changes during the year. Early in the year member banks, having purchased certificates of indebtedness and wishing to obtain funds for short periods, sold small amounts to this bank with their agree ment to repurchase, but after a few months the practice was dis continued. In connection with the handling of subscriptions to the first Liberty loan, there was allotted to this bank $2,600,000 of 3 J per cent bonds in excess of the subscriptions received. On June 29, 1918, on vote of the directors of the bank, these were taken over from the Treasury Department and paid for. On July 8, $2,000,000 were sold to the War Finance Corporation. During the balance of the year, several sales were made until the bank had disposed of its entire holdings. Several small amounts of Liberty loan bonds of different issues were taken over by the bank from one source or another, until at the end of the year our holdings, exclusive of bonds sold on the installment plan, amounted to about $8,000. There were also $529,000 conversion 3s remaining unsold from the conversion of 2 per cent bonds into 3 per cent bonds and one-year notes. It has been the policy of the Government during the current year to pay its one-year notes on maturity instead of renewing, as it is 100823°—19 18 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

274 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. privileged to do. Of the $1,416,000 United States notes held at the close of last year, $750,000 matured October 1, 1918, and were paid. As these had been pledged to secure Federal Reserve bank notes, a like amount of one-year 2 per cent certificates of indebtedness was purchased and pledged in their place. In addition there have been purchased $6,000,000 2 per cent certificates of indebtedness to be pledged against Federal Reserve bank note circulation, making the total amount of notes and certificates so pledged at the end of the year $7,416,000. During December, anticipating withdrawals from Government depositaries, the Treasurer of the United States on several occasions sold to the Federal Reserve Bank one and two day 2 per cent cer tificates of indebtedness, the proceeds being credited to his account. The largest amount held at any one time was $18,000,000, the total so purchased being $67,000,000. RESERVE POSITION. Enlargement of the bank's activities has had the effect of causing marked fluctuations in its reserve position, as shown by Schedule 11 and accompanying charts. The amount of gold held by the bank has varied widely but with a decided upward tendency. Banks in this district, both member and nonmember, have turned over their gold freely to the Boston Federal Reserve Bank, taking Federal Reserve notes in exchange. Several conflicting factors account prominently for the reserve fluctuations: First, the increase in gold holdings mentioned above; second, the large increase in required reserves due to larger net deposits and increased note issues; third, the heavy rediscounts by member banks following Government withdrawals of funds on deposit with member and nonmember banks; fourth, the placing of call loans in New York City by banks holding large Government deposits and the consequent temporary losses by this bank of gold, through the settlement fund. From the end of August until the close of the year there was a downward tendency in the reserve position of the bank, due to the expansion of the bank's loan account and to the increase in Federal Reserve notes outstanding. The former condition was brought about through large transfers by the Government to other Federal Reserve districts to meet its heavy payments, causing a loss of gold, and the latter was caused by increased need for circulation, requiring larger gold reserves. MOVEMENT OF MEMBERSHIP. The movement to convert national banks into nonmember trust companies, so prevalent in this district in the early days of the Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 1 BOSTON. 275 Federal Reserve system, has entirely abated and several of the banks which gave up national bank charters to operate under State laws have made application and been admitted to membership in the Federal Reserve Bank of Boston during the year. The only bank to surrender its entire holdings of Federal Reserve Bank stock was the Yale National Bank, of New Haven, which consolidated with the First National Bank of New Haven. Three new national banks have commenced business and 18 trust companies have been admitted to membership, making a net increase in members of 20. The total number of member banks at the end of 1918 was 423, holding 133,835 shares of stock, compared with 403 banks, holding 117,169 shares at the end of 1917. RELATIONS WITH NATIONAL-BANK MEMBERS. Continued progress has been made during the past year in develop ing a closer relationship between the Federal Reserve Bank and its members. The payment by the Federal Reserve Bank of shipping charges on currency, assumption of the cost of telegrams, and free collections of checks and other items have been appreciated by all member banks. In order to maintain closer relations with those banks located in Vermont and New Hampshire, E. A. Davis, cashier of the National White River Bank, of Bethel, Vt., was procured to act as the repre sentative of this bank in that section and to instruct the bank's members regarding the various facilities available for their use. The fullest cooperation in the matter of placing Liberty loans and certificates of indebtedness has been secured both from members and nonmembers, and member banks have not hesitated to seek rediscounts when their needs demanded. Applications for fiduciary powers were received from numerous national banks during the first part of the year, and with the amend ments of the Federal Reserve Act in September, allowing an increased scope, many banks which had formerly been granted the limited powers allowed, applied for the additional powers now available. Schedules 16 and 17 show the banks given these special powers. RELATIONS WITH STATE BANKS AND TRUST COMPANIES. As in the case of the national banks, the activities of this bank as fiscal agent have brought it into closer touch with the trust companies during the year. The larger banks have been favorably inclined toward the system and many have made application and been admitted to membership. During the year 18 trust companies became members, making over 65 per cent of the resources of eligible trust companies represented in the system. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

276 ANNUAL KEPORT OF THE FEDERAL RESERVE BOARD. Several reasons can be ascribed for the failure of others to become members, the principal ones being (1) The banking laws of several of the New England States are not such as to encourage membership in the reserve system; (2) the character of the business of many trust companies is more nearly that of savings banks than commercial banks, and as such membership is not particularly attractive either from the viewpoint of the bank or of the Federal Reserve system; (3) Some banks are waiting for neighboring banks to move first; (4) Many of the smaller banks have not as yet given the matter sufficient study to realize the possibilities to themselves as members. Liberty loan operations have caused many nonmembers to borrow from the Federal Reserve Bank through members, and this has resulted in bringing them to appreciate more fully the services ren dered by this bank to the community. During the last few months much interest has been manifested in membership by medium-sized and small trust companies, and several applications^ have been received. Schedule 14 shows all member trust companies. CREDIT DEPARTMENT AND BANK EXAMINATIONS. The credit department, in so far as it pertains to commercial credits, has increased its scope but little during the year. Statements on all notes or trade acceptances of over $5,000 are required, but no attempt has been made to give the service of checking credits to member banks. Accepting banks and bankers have been investigated, and where their bills have been purchased unindorsed they have been required to furnish statements. The nucleus of an examining department has been established and is working in conjunction with the credit department. Statements of condition of member banks are carefully analyzed and every attempt made to keep in close touch with their condition. State member banks are either examined annually by this bank's examin ing department, or a representative participates in the examination by the State authorities or public accountants, although m some cases the examinations of State banking departments have been accepted without participation. DEPOSITS. Member bank deposits with this bank have shown a steady increase throughout the year, having expanded from about'$80,000,000 at the end of 1917 to an average of about $100,000,000 toward the end of 1918. This has been due to increase in membership by the admission of trust companies during the year and the increase which member banks in general have had in their own deposits, necessitating the carrying by them of larger reserves. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 1 BOSTON. 277 Taken as a whole, little trouble has been experienced in having member banks maintain the required reserves, although at times members have been inclined to allow their accounts to drop below the requirements, taking care to see that their balances were built up during the month so that no average deficiency occurred. It may be found desirable at an early date to obtain weekly instead of monthly reports of required reserve. The policy of penalizing those which have insufficient reserves has been continued throughout the year. PERIODIC REPORTS REGARDING MEMBER BANKS. The system of weekly reports of member banks in the larger centers, begun late last year, has been continued. Weekly reports of clearings of banks in the principal cities of the district are received each week. There have been four calls by the Federal Reserve Board for conditions of member trust companies during the year and six calls by the Comptroller of the Currency for the conditions of national banks. Copies of these reports have been received by the Federal Reserve Bank. A report of at least two examinations of each national bank is received each year from the chief national bank examiner, and at least one examination is made of each other member, as mentioned elsewhere. FISCAL AGENCY OPERATIONS FOR TREASURY DEPARTMENT. CERTIFICATES OF INDEBTEDNESS AND GOVERNMENT DEPOSITS. Fiscal operations of the Government have been a more dominant factor in the activities of the Federal Reserve Bank than in any previous year, becoming increasingly heavy as the year advanced and as participation of the country in the European war became greater. Throughout the entire year, as will be seen by Schedule 22, the Treasury Department made offerings of United States certificates almost fortnightly—certificates issued in anticipation of the payment of taxes and those to be refunded by Liberty loan bonds. As regards issues other than those for tax purposes, each Federal Reserve dis trict was allotted an amount based on a percentage of its banking resources. To handle these frequent offerings, a committee was formed, consisting of Storer P. Ware, chairman; Charles A. Morss, governor; and Frederic H. Curtiss, Federal Reserve agent. This committee was supplemented by representatives from 16 centers in the district. The committee urged ever}^ bank to set aside 2t per cent of its resources every two weeks to invest in certificates, and in time most of the banks were able to adopt this program. Schedule 23 shows the amount of subscriptions in the district. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

278 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. Many subscribing banks paid for their certificates by crediting the Government on their books, deposits being secured by collateral as specified by the Treasury Department. These * deposits were gradually withdrawn by the Government and placed on deposit with the Federal Reserve Bank, being checked against or transferred by the Government, as needed. At each withdrawal, which was on a uniform percentage basis from each bank, members financed them selves when necessary through rediscounting with the Federal Reserve Bank. Fluctuations of rediscounts in the Federal Reserve Bank, shown by chart D, illustrate graphically how this demand was met. A similar method of financing was adopted in connection with the payment of Federal taxes on June 15. These taxes amounted in New England to over $300,000,000. These payments falling largely on the Boston banks, a great part of the receipts was deposited with those banks, proportionate to the amount drawn on each. These deposits were likewise secured by collateral and gradually withdrawn. Schedules 24 and 25 and accompanying chart show details of Govern ment deposits. FLOTATION OF LIBERTY LOANS. The organization built up during the first and second campaigns was maintained and further improved to handle the third and fourth Liberty loans. The chairman of the Liberty loan committee was the governor of the Federal Reserve Bank of Boston, Charles A. Morss. The active management was in the hands of N. Penrose Hallowell, executive chairman; J. R. Macomber, assistant executive chairman; James Dean, chairman of distributing committee; and Mrs. F. L. Higginson, chairman of the women's committee. The handling of these loans and other fiscal operations has required a large increase in the banking force and accommodations. Details of the loans are contained in Schedules 26 to 34. The epidemic of influenza which continued until almost the end of the fourth Liberty loan campaign prevented all forms of public demonstrations, which had proved so effectual in previous campaigns, and other methods to stimulate subscriptions had to be adopted. Individual solicitations had to be increased and the Federal Reserve Bank established a 4 per-cent 90-day rate on rediscounts of loans on bonds of the fourth Liberty loan in order to stimulate subscriptions against future income. The quota allotted to this district for the third campaign was $250,000,000 and for the fourth campaign, $500,000,000. The sub scriptions received were $354,537,250, or 141 per cent, and $632,221,- 850, or 126 per cent, respectively. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 1 BOSTON. 279 WAR-SAYINGS CERTIFICATES. Until November 15, 1918, the war-savings campaign was con ducted by the Treasury Department. The Federal Reserve Bank simply carried and distributed stamps to the qualified agents. Early in November, acting under instructions from Washington, the cam paign for war savings was placed under the direction of the governors of the Federal Reserve banks. Until the end of the year, the same organization as in the past has been continued. Frequent meetings have been held by the governor with the chairmen of the different State committees, and efforts have been made to stimulate sales of war-savings and thrift stamps. After the first of the year, Mrs. F. L. Higginson, chairman of the women's Liberty loan committee, will become district chairman of the war-savings campaign, and she is at present perfecting an organization whereby that important work will be placed in the hands of committees of women, who will work closely in touch with the Liberty loan organizations, and who hope to develop a general campaign for thrift and economy throughout the district. Schedule 35 shows sales by States. CAPITAL ISSUES COMMITTEE. Acting under instructions from the Federal Reserve Board, follow ing a request from the Secretary of the Treasury, a committee was formed to pass on all applications with " respect to capital expendi tures or the issue of new securities " originating within the New Eng land district. This committee reported its conclusions to a central committee in Washington, the reports being based upon whether such expenditures or issues were compatible with the national in terest. This committee consisted of Frederic II. Curtiss, chairman; Charles A. Morss, vice chairman; Charles Francis Adams, Henry G. Bradlee, Philip Cabot, Allen Curtis, Henry B. Day, Francis R. Hart, James F. Jackson, John E. Oldham, and Robert Winsor. Its first meeting was held on February 1, 1918, and thereafter weekly. The committee acted under the direction of the Federal Reserve Board until April 5, 1918, when the War Finance Corporation law went into effect. After that date these same persons, together with Thomas W. Farnum, Allan Forbes, Arthur M. Heard, Robert W. Hunting ton, Frank W. Matteson, Edmund R. Morse, and H. M. Verrill, continued to serve as a permanent committee until they were authorized to dissolve on December 31, 1918. The committee secured the services of George Tyson as a consulting member and E. H. Kittredge as secretary. The bankers and brokers of the district gave their fullest support to the activities of the committee. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

280 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. Schedule 36 shows to some extent the scope of the committee's activities. The committee, besides assuming jurisdiction over securi ties, supervised to a large extent the bank loans of public utilities and assisted in investigating and recommending needed Federal legis lation to safeguard the public against issues of fraudulent securities. WAR FINANCE CORPORATION. The War Finance Corporation has been called upon to assist to a very limited extent in the New England district. In those cases where advances have been made, the Federal Reserve Bank has acted as agent, delivering funds furnished by the corporation and receiving and holding securities and documents as directed by it. FEDERAL RESERVE NOTE ISSUES. The amount of Federal Reserve notes outstanding has increased steadily throughout the year, the gold held by the bank being thus increased and conserved. The amount outstanding at the end of the year was considerably more than double the amount on January 1, 1918, as is shown by Schedules 37 and 38. Under arrangements between the bank and the Federal Reserve agent, the total bill holdings of the bank are pledged at all times as security for these notes in addition to the required gold reserve. The large demand for currency has necessitated the printing and mainte nance of a larger supply, and the standing order on file in Washington for notes of this bank has been increased several times during the year. Under the amendment to the Federal Reserve Act of September 26, 1918, authorizing the issuance of Federal Reserve notes of $500, $1,000, $5,000, and $10,000 denominations, orders have been filed for an amount aggregating $52,000,000 of these denominations for this bank. Including notes in process of printing and the above notes of large denominations, it is intended to have available at all times a supply aggregating about $225,000,000. FEDERAL RESERVE BANK NOTES. Under the law providing for the temporary retirement of a large quantity of silver certificates and the melting of the silver dollars, against which these were issued, this bank has put into circulation nearly $7,000,000 of Federal Reserve bank notes. These are secured by United States notes and certificates, and are issued in denomina tions of $1, $2, and $5. POSITION OF COMMERCIAL BANKS AS THE RESULT OF WAR FINANCING. Apart from temporary Government deposits in the banks, deposits at the end of the year show very little change in volume from that shown at a similar date in 1917, the general movement being an in- Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 1 BOSTON. 281 crease in demand deposits and a decrease in time deposits. Schedule 40 shows a comparison of items of thirty-six of the larger banks in the district in December, 1917, and December, 1918. The heavy increase in the amount of United States securities owned is due largely to the holding of short-time Treasury certificates, the bank holdings of Liberty loan bonds showing a rather moderate increase. On the other hand, there is a heavy increase in loans secured by United States securities. While banks were urged to purchase short-term certificates of indebtedness as they were issued, they have been discouraged from tying up their commercial deposits in long-term Government bonds. Banks were urged during the war period to conserve their resources for Government uses, to assist industries engaged in war work, and to curtail as far as possible, credits to industries not essential to the war. POLICY TO BE PURSUED IN RESTORING LIQUIDITY OF BANKS. As the industries of this district when hostilities ceased were largely given to Government work, the cancellation of war orders will probably bring about a considerable reduction in commercial loans. Banks of the district are carrying a very large volume of loans against Liberty bonds, and on December 31 about 75 per cent of the loans in the Federal Reserve Bank and of loans discounted by that bank with other Federal Reserve Banks were against Government securities. As early as possible, means should be taken to encourage liquidation of such loans. The most effective means would appear to be the gradual increasing of the Federal Reserve Bank's discount rate on bond-secured loans. How fast and how far this rate should be increased will depend on its effect on the future offering of Govern ment securities and the rate at which such securities are offered. No other method than by rate increase seems practicable, although banks should be urged to bring some pressure on their borrowers of this class, either by increasing rates or by demanding an additional margin of collateral. How soon this war paper can be liquidated, it is difficult to say. If liquidation comes in commercial loans, banks may liquidate their Federal Reserve Bank borrowings, but as soon as the Government's requirements have been met, liquidation should be steadily and consistently forced by the Federal Reserve Bank increasing its rates INTERNAL ORGANIZATION. There have been several changes in the official organization of Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

282 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. during the first half of the year, and Philip R. Allen, of East Walpole, Mass., was elected by banks in group 1, on July 1, 1918, to fill the unexpired term, running until January 1, 1921. The Federal Reserve Board, on August 6, appointed Jesse H. Metcalf, of Provi dence, R. I., a class C director, to fill the unexpired term of Andrew J. Peters, who had resigned to become mayor of Boston. This term runs until January 1, 1920. The terms of Arthur M. Heard, class A director, and Charles G. Washburn, class B director, expired January 1, 1919. Under the amendments to the Federal Reserve Act in September, 1918, Mr. Heard was not eligible for reelection, being an officer of a bank in a different group from that which he represented as director of this bank. Elections were held during the fall months. Charles G. Washburn was reelected and Edward S. Kennard, cashier of the Rumford National Bank of Rumford, Me., was elected to succeed Arthur M. Heard. The terms of these directors expire January 1, 1922. Allen Hoilis, class C director, whose term expired January 1, 1919, was reappointed by the Federal Reserve Board for a term running to January 1, 1922, and was redesignated as vice chairman. At a meeting of the board of directors held January 3, 1918, Daniel G. Wing, president of the First National Bank of Boston, was reelected as a member of the Federal Advisory Council. The growth of the bank has necessitated the election of additional officers. On January 3, Charles E. Spencer, jr., treasurer of the Colonial Trust Co. of Waterbury, Conn., was elected deputy governor, taking office February 1, 1918. On January 31, William N. Kenyon was elected assistant cashier, to take effect February 1, 1918, and on March 28, Frank W. Chase and L. Wallace Sweetser were elected assistant cashiers to take effect April 1, 1918. The clerical force of the bank has been doubled during the year, there being 499 employees on December 31, as compared with 256 at the end of 1917. Of this force, about 60 per cent are women. In addition, about 86 clerks are employed by the Liberty loan committee. CLEARINGS AND COLLECTIONS. The check collection department has had rapid growth during the year, the clerical force having increased from 35 to 109. The number of New England items has increased from 9,000 to approxi mately 35,000 loose checks a day, not including checks received from Boston banks. The latter are received in packages divided by banks on which drawn. This method has not been entirely satisfactory, and it is expected that before long all checks will be Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 1 BOSTON. 283 7,500. Boston Clearing House checks have increased correspond ingly. The large increase in checks handled was brought about by two factors: First, the elimination on June 15 of the service charge for collection; second, by the New York Clearing House rule, which made it necessary for New York banks to collect all checks through the Federal Reserve Banks, if they were unable to collect them as expeditiously through their other correspondents. Previous to the elimination of the service charge, it was customary to make a per item charge sufficient to cover the actual cost of collection. This cost is now absorbed by the Federal Reserve Bank. The collection system for time items, while not so well developed as that for check collections, has made considerable progress during the year. The elimination of the service charge on checks also applied to time collections and brought about an increase necessi tating the enlargment of that department. All items are collected free except for the charge made to the Federal Reserve Bank by the collecting agent, and a charge of 15 cents on items returned unpaid. The time collection system, however, is far from satis factory, and some uniform basis for collection charges should be agreed upon by the Federal Reserve Banks instead of leaving the charge subject to the pleasure of the collecting bank. GOLD SETTLEMENT FUND. Commencing in May, the Federal Reserve agent of Boston trans ferred to the gold settlement fund the entire amount of gold certi ficates held by him against Federal Reserve notes, and these are now held in Washington, subject to his order. Schedule 12 shows the amounts cleared during the year, not including direct transfers caused by special transactions and which did not enter into clearing, such as transfers between the bank and the Federal Reserve agent of Boston. BANKING QUARTERS. One of the most serious problems which the large increase in the Federal Reserve Bank's activities has produced has been to secure adequate quarters in which to house its large force of clerks and to properly handle the immense volume of work that this increased activity has brought about. At the beginning of the year the bank occupied about 16,000 square feet of working space, its quarters, besides the main banking room at 53 State Street, extending to 84 State Street and 131 State Street. These were later increased by renting a building at 20 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

284 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. This has given the bank, at the end of the year, about 40,000 square feet of working floor space. Having banking quarters so poorly located has prevented economic and efficient handling of work and a permanent building was deemed vital. After careful survey of the available sites, the board of directors voted to purchase the land and building at 95 Milk Street. This property, covering about 13,363 square feet of land, was purchased on June 27 for slightly over $1,000,000. The lot has a frontage of 63.51 feet on Post Office Square and of about 129 feet on Pearl Street, and is conveniently situated with respect to the financial seotion of Boston. It is proposed to tear down the present building and to erect at an early date a building which will accommodate all of the bank's activities. In order that this subject might be given careful consideration and study, a building committee was appointed by the board of directors, consisting of E. R. Morse, chairman; Charles G. Washburn, Philip R. Allen, Charles A. Morss, governor; and Frederic H.Curtiss, Federal Reserve agent. CONCLUSION. Business and banking have not as yet had time to adjust them selves since the signing of the armistice. The impetus of war work is still felt in almost every trade, and the year has ended with most of the industries fairly active, and with a strong demand for money, the continued requirements of the Government for loans more than offsetting any liquidation of Government commitments on war contracts. As yet there is no marked oversupply of labor in the district. The readjustment of New England industries from a war to a peace basis will be no easy task, as this is largely an industrial community. The raw material market will, no doubt, within a short time adjust itself, but the problem of labor is more difficult to solve. If the mills and manufacturers of New England are to be dependent upon domestic trade, there must be reasonable protection for them from foreign competition, and if on foreign trade, they must be in a position to compete against scales of wages prevailing in the industrial centers of other countries. Manufacturers must be able to transport goods and finance sales to foreign markets in a satisfactory manner, if they are to compete with foreign-made goods. The large increase in our merchant marine, it is expected, will make it possible to transport goods economically in American bottoms, and the large banks in New England are organized and fitted to give satisfactory service in financing any foreign demand for goods manufactured in the district. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 1 BOSTON. 285 The readjustment of the industries of the district and the liquidation of the heavy loans now being carried by the banks through the financing of subscriptions to Government securities will require the most careful study and handling, both by the local bankers and by the officials of the Federal Reserve Bank. EXHIBIT A.—Movement of principal earning assets of the Federal Reserve Bank of Boston during the calendar year 1918. [In thousands of dollars; i. e., 000 omitted.] Discount s S e e t c U d a o u t b n e p r l s i e i a t g d p e a w d e b r a y r | O c t p o h a u e p n r e t d e r. d i s (1+2.) b m ou o B a g p r i k l h e l n t e s t i . n T d b o e is o d t c a u o l a g u b n h n i d t l t . l s P ( e 1 r - c 5 e ) n . t tions. 1 39,730 17,591 57,321 9,633 66,954 59.3 37,106 14,104 51,210 5,832 57,042 65.1 39,187 11,441 50,628 6,350 56,978 68.8 40,214 12,630 52,844 9,307 62,151 64.7 38,720 10,943 49,663 11,724 61,387 63.1 37,510 10,526 48,036 13,757 61,793 60.7 44,160 11,643 55,803- 14,923 70,726 62.4 48,567 10,869 59,436 16,287 75,723 64.1 50,822 10,137 60,959 21,685 82,644 61.5 49,813 10,436 60,249 8,072 68,321 72.9 46,560 8,201 54,761 9,477 64,238 72.5 46,905 9,924 56,829 11,475 68,304 68.7 49,103 10,638 59,741 12,746 72,487 67.7 47,933 10,895 58,828 13,589 72,417 66.2 46,966 9,946 56,912 13,475 70,387 66.7 41,438 8,137 49,573 14,267 63,840 64.9 44,594 9,713 54,307 16,606 70,913 62.9 43,256 8,826 52,082 18,618 70,700 61.2 40,805 9,460 50,265 18,862 69,127 59.0 26,203 9,846 36,049 21,037 57,086 45.9 31,242 10,035 41,277 22,314 63,591 49.1 32,134 11,681 43,815 23,060 66,875 48.1 35,165 11,848 47,013 21,811 68,824 51.1 36,481 11,575 48,056 21,303 69,359 52.6 33,457 12,387 45,844 20,336 66,180 50.6 34,813 16,360 51,173 21,638 72,811 47.8 50,578 21,929 72,507 22,241 94,748 53.4 58,132 27,192 85,324 26,267 111,591 52.1 57,810 28,363 86,173 24,683 110,856 52.1 64,518 26,656 91,174 24,297 115,471 55.9 61,565 22,905 84,470 20,636 105,106 58.6 60, 728 24,229 84,957 18,938 103,895 58.5 42,814 22,167 64,981 21,616 86,597 49.4 46,603 20,811 67,414 26,440 93,854 49.7 51,439 20,749 72,188 28, 746 100,934 51.0 62,611 19,374 81,985 29,353 111,338 56.2 6 6 7 7 7 7 5 5 1 6 , , , , , 8 5 2 2 5 8 5 0 4 1 7 5 5 6 6 1 1 1 1 1 3 1 6 7 5 , , , , , 5 5 1 8 6 9 0 3 1 3 4 4 9 7 0 8 8 8 8 8 3 7 4 9 6 , , , , , 5 0 0 6 8 0 3 5 5 4 4 5 9 5 0 5 2 3 2 4 3 9 5 9 6 , , , , , 8 8 3 8 9 2 2 1 4 6 1 5 1 2 8 1 1 1 1 1 3 2 1 3 6 2 3 , , , , 3 6 6 3 2 2 8 7 5 3 2 0 5 5 5 5 8 9 6 8 . . . . 1 1 6 0 67,306 11,079 78,385 59,744 140,860 53.4 77,591 11,653 89,244 55,880 138,129 48.7 93,849 10,635 104,484 43,863 145,124 53.5 116,843 11,616 128,459 30,710 148*347 63.3 134,813 11,472 146,285 11,941 159,169 73.4 120,908 12,578 133,486 15,448 158,226 85.2 131,096 12,616 143,712 25,229 148,934 81.2 122,877 12,747 135,624 16,942 168,941 77.6 127,797 10,840 138,637 14,660 152,566 80.5 108,438 9,224 117,662 12,843 153,297 83.4 116,328 13,814 130,142 15,944 130,505 83.1 146,086 79.6 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

286 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. FEDERAL RESERVE BANK OF BOSTON. MOVEMENT OF EARNING ASSETS DURING T/fE CALENDAR YEAR ISIS. hi Girre I: Jf/ar/banjhjter. Ckrre£;&frUJftilZs3i$eounted,. 6 GcryeS.-SSios 3iscotatted, anaJSought?. Gxrrc4:&tid€&nznxtJIsset$j ittd.ttS. Government Securities. r CUrveS:lkcUip cfJVor-GxxKjimcr I to JoCalJBills &iscowtf^an&$otf£kt?. CHAET A. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 1 BOSTON. 287 EXHIBIT B.—Movement of cash reserves, net deposits, Federal reserve note liabilities and the reserve percentage of the Federal Reserve Bank of Boston during the calendar year 1918. [In thousands of dollars; i. e., 000 omitted.] Ratio of cash re Federal serves to T r o e t s a e l r v c e a s s . h dep N o e s t i ts. ac n R t o e u t s a e e l s r c v in i e r (2+3.) de F p e o n d s e e i t t r a a l nd culation. Reserve note liabil ities com bined. 1 2 3 4 5 Jan .4 80,408 69,791 74,246 144,037 55.8 Jan. 11 94,650 73,076 75,308 148,334 63.8 Jan. 18 106,414 87,505 74,682 162,187 65.6 Jan. 25 103,530 88,459 75,872 164,331 63.0 Feb.1 92,886 76,257 76,434 152,691 60.8 Feb.8 106,072 85,438 78,755 164,193 64.6 Feb. 15 87,574 73,390 80,985 154,375 56.7 Feb. 21 98,291 86,973 83,701 170,674 57.6 Mar. 1 91,455 83,041 87,273 170,314 53.7 Mar. 8 110,497 86,096 88,908 175,004 63.1 Mar. 15 110,005 80,124 89,932 170,056 64.7 Mar. 22 114,705 88,084 90,844 178,928 64.1 Mar. 29 118,737 94,480 92,789 187,2G9 63.4 Apr. 5 116,237 87,659 95,978 183,637 63.3 Apr. 12 122,937 90,081 98,138 188,219 65.3 Apr. 19 133,596 93,014 99,437 192,451 69.4 Apr. 2o 135,658 100,068 101,467 201,535 67.3 May3 126,150 89,101 102,547 191,648 65.8 May 10 127,714 89,377 102,484 191,861 66.6 May 17 137,710 86,991 102,818 189,809 72.6 May 24 135,353 91,040 102,898 193,938 69.8 May 31 143,597 100,960 104,475 205,435 69.9 June 7 146,612 103,013 107,327 210,340 69.7 June 14 139,718 96,156 107,808 203,904 68.5 June 21 138,026 89,002 109,955 198,957 69.4 June 28 132,912 88,381 112,533 200,914 66.2 July 5 133,236 107,245 118,328 225,573 59.1 July 12 145,442 131,149 121,153 252,302 57.6 July 19 113,799 98,199 121,466 219,665 51.8 July 26 109,863 94,517 125,759 220,276 49.9 Aug. 2 116,975 88,099 128,844 216,943 53.9 Aug. 9 140,326 107,249 131,725 238,974 58.7 Aug. 16 140,317 88.533 132,857 221,390 63.4 Aug. 23 150,000 104,053 134,157 238,210 63.0 Aug. 30 147,403 105,846 136,817 242,663 60.7 Sept. 6 140,992 104,507 141,840 246,347 57.2 Sept.13 147,900 110,396 144,288 254,684 58.1 Sept. 20 138,551 99,472 145,576 245,048 58.5 Sept .27 137,810 105,521 148,053 253,574 54.3 Oct. 4 127,713 104,648 152,981 257,629 49.6 Oct. 10 131,446 110,062 155,320 265,382 49.5 Oct. 18 127,928 102,510 155,629 258,139 49.6 Oct. 25 143,694 128,988 151,792 280,780 51.2 Nov. 1 109,166 100,075 152,460 252,535 43.2 Nov. 8 133,125 132,907 153,267 286,174 46.5 Nov. 15 121,186 120,544 152,980 273,524 44.3 No v. 22 113,350 104,193 150,983 255,176 44.4 Nov. 29 106,501 118,012 150,906 268,918 39.6 Dec. 6 117,488 111,273 151,943 263,216 44.6 Pec. 13 111,919 102,160 155,817 257,977 43.4 Dec. 20 106,131 83,512 161,359 244,871 43.3 Dec. 27 115,168 91,835 163,205 255,040 45.2 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

288 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. FEDERAL RESERVE BANK OF BOSTON. DEPOSIT AND NOTE LIABILITIES, ALSO CASH RESERVES, DURING THE CALENDAR YEAR 1318. Owe I: JfetZkjtosCts. CurvcZ.-JotaL Cash Jtcseryes. Cuwvo3: Jlggregatt Jfa&GWstiand>£&.&U/!uzbiUtCe$. Cw»e4tJattio of' Cas/vrfeserres Gojfggregat& Jfet jDeftosit and, JFft.Mte, JlabiliCtes. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 1 BOSTON. 289 SCHEDULE 1.—Income and expense. Expense. 1917 1918 Income. 1917 1918 Paid in lieu of dividends Balance Jan. 1 $11,596.56 on stock canceled $3,926.85 $271.89 Bills discounted for Current expenses 51,288.75 151,852.48 memberbanks 571,117.13 $3,068,027.38 Directors' fees 5,781.10 1,230.00 Acceptances purchased.. 502,397.30 931,700.98 Rent 15,246.49 26,681.56 State, city, and town Salaries 93,193.65 274,361.49 notes 5,202.73 Exchange paid 69.10 245.71 Interest on United Cost ot Federal Reserve States securities 94,784.86 107,719.03 As n s o e t s e s s m ent for expenses 102,621.37 167,828.00 Pr s o e f c it u r o i n ti e U s nited States 11,101.60 41,821.34 of Federal Reserve Penalties for deficient Re B al o a e r s d t ate expenses 21,226.35 2 27 9 , , 8 5 1 5 1 4 . . 1 0 4 2 1 Su r n e d se ry r v p e r s o fits 6 7 , , 1 2 0 9 5 9 . . 3 6 9 7 2 1 12 8 , , 7 4 6 2 0 5 . . 2 7 7 1 Furniture and equip ment 8,973.83 24,173.97 Difference account 814.83 4,557.70 Repairs and alterations.. 10,450.00 61,894.92 Sundries 1,462.24 3,554.20 Transit department 8,255.87 101,529.38 Real estate charged off.. 200,000.00 To balance 886,294.79 3,304,908.25 Total 1,209,605.24 4,380,454.71 Total 1,209,605.24 4,380,454.71 SCHEDULE 2.—Distribution of net earnings. Year Year ending ending Dec. 31, Dec. 31, 1917 1918 1917. 1918. Dividend paid member $597,828.54 $383,908.25 Available for distribu $886,294.79 $3,304,908.25 banks. tion. Reserve for depreciation on 138,266.25 United States securities. Balance 150,200.00 2,921,000.00 886,294.79 3,304,908.25 886,294.79 3,304,908.25 1918 1919 i 1918 1919 Reserve for franchise tax 75,100.00 1,460,500.00 Jan. 2, balance 150,200.00 2,921,000.00 Carried to surplus account.. 75,100.00 1,460,500.00 150,200.00 2,921,000.00 150,200.00 2,921,000.00 SCHEDULE 3.—Comparative balance sheet, Dec. 31, 1917, and Dec. 31, 1918, Dec. 31, 1917. Dec. 31,1918. RESOURCES. Earning assets: Bills discounted secured by United States war obligations $43,897,560.83 $120,515,666.97 Other bills discounted (commercial) 21,984,798.52 13,059,656.44 Acceptances purchased 9,037,506.04 15,084,299.96 United States bonds 609,750.00 537,750.00 United States short-term obligations 2,194,000.00 7,416,000.00 Total 77,723,615.39 156,613,373.37 Reserve cash: Gold (coin and certificates) 18,690,900.00 3,317,260.00 Gold settlement fund 16,977,000.00 37,292,607.33 Bank of England sterling gold account 3,675,000.00 408,021.21 Other lawful money 3,574,566.00 2,287,793.10 Total 42,917,466.00 43,305,681.64 « 100823°—19 19 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

290 ANNUAL REPORT OE THE FEDERAL RESERVE BOARD. SCHEDULE 3.—Comparative balance sheet, Dec. SI, 1917, and Dec. 31,1918—Contd. Dec. 31, 1917. Dec. 31,1918. RESOURCES—continued. Reserves against Federal Reserve notes: Gold with Federal Reserve agent $40,8 96,820.00 $59,733,330.00 Gold redemption fund 2, 000,000.00 7,812,380.00 Other resources: Interest accrued on United States securities 21,958.75 33,133.69 Due from Liberty loan subscriptions 118,035.40 567,480.00 Expense, Liberty loan, etc. (recoverable) 144,167.62 573,091.80 Items in process of collection *• 007,383.44 52,910,810.45 Exchanges for clearing house and cash items... 216,597.70 10,548,466.02 Federal Reserve notes and other cash on hand. 661,035.81 13,809,622.36 Due from Government depositaries 489,691.55 30,014,655.68 Redemption fund Federal Reserve bank notes. 320,400.00 Real estate for bank quarters 800,000.00 Total. 253,196,771.66 377,042,425.01 LIABILITIES. Capital fund: Capital paid in 1,858,450.00 6,691,750.00 Surplus 75,100.00 1,535,600.00 Deposits: Due to member banks, reserve account 82, 842,197.76 101,806,494.59 Due to Federal Reserve banks, collected fundsl 3, 870,139.46 17,467,049.53 Due to banks, uncollected funds* 13, 780,544.93 29,969,374.00 Due to Treasurer of United States, general account., 2. 419,414.94 10,499,061.56 Due to Treasurer of United States, special account.. 66. 489,691.55 30,014,655.68 Cashiers' checks outstanding 20,416.38 411,417.98 Other liabilities: Federal Reserve notes outstanding 77,296,820.00 168,986,330.00 Federal Reserve bank notes outstanding 6,889,000.00 Unearned discount and interest 468,896.64 467,850.01 Reserve for depreciation and interest 93,341.66 Reserve for franchise tax **75,'i66"6o 1,460,500.00 Mortgage on real estate 750,000.00 Total 253,196,771.66 377,042,425.01 Liability for rediscounts with other Federal Reserve banks. 44,477,789.1 48,962,693.27 i Offsetting items to be cleared through gold-settlement fund. SCHEDULE 4.—Items of interest from the schedules of this and other official reports in connection with the fiscal operations of the United States in this district during 1918. Proceeds of the second Liberty loan and final payment Jan. 15, 1918 $42,000,000 Proceeds of the third Liberty loan 355,000,000 Proceeds of the fourth Liberty loan and payments of Dec, 31, 1918 560,000,000 Proceeds of United States tax certificates (1918) $62,000,000 Proceeds of United States tax certificates (1919) 100,000,000 Proceeds of United States certificates (third Liberty loan) 214,000,000 Proceeds of United States certificates (fourth Liberty loan) 381,000,000 Proceeds of United States certificates (fifth Liberty loan) 92,000,000 Total certificates sold 849,000,000 Federal taxes collected '. 311,000,000 Proceeds of war savings stamps to Dec. 1,1918 54,000,000 DISBURSEMENTS. Expenditures disbursed by check 1,167,000,000 Transfers to other Federal Reserve banks, net 581,000,000 Total United States certificates paid 609,000,000 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 1—BOSTON. 291 SCHEDULE 5.—Transactions with other Federal Reserve Banks. Acceptances allotted to and Acceptances allotted by and rediscounts with— rediscounts for— Acceptances. Rediscounts. Acceptances. Rediscounts. $20,118,745 $4,973,582 12,926,908 i 5,281,831 15,249,557 $25,223,947 Richmond 2 1,940,214 $3,485,450 St. Louis 5,000,006 7,338,923 20,032,100 2,498,477 5,037,199 2,000,000 14,369,921 Total 75,041,253 45,256,047 12,195,627 12,983,933 i Represents a repurchase, before maturity, of acceptances sold to another Federal Reserve Bank. 2 Includes $205,214 of discounted trade acceptances. SCHEDULE 6.—Maturities of invested funds on last day of each month, 1918. Within 15 16 to 30 days. 31 to 60 days. 61 to 90 days. Over 90 Total. days. days. January... 260,607.00 $4,201,6 36.64 [$10,266,870.74 $41,599, 277.57 $63,328. 391.95 February.. 310,545.37 7,636,8 43.93 15,553,582.45 43,854, 262.61 $6,236.00 82,361) 470.36 March..".. 410,624.69 8,886,9 90. 48 39,355,805.75 13,533. 558.89 4,475.00 73,191, 454.81 April 844,800.50 6,362,3 82.24 15,406,640.21 6,002; 280.38 927.00 70,617, 030.33 May 236,141.56 9,177,3 57.06 12,965,018.05 28,495, 707. 79 1,272.50 66,875, 496.96 June 129,385.56 12,196,0 11.21 34,437,479.31 10,347, 824.04 7,574.50 73,118, 274.62 July 427,550.06 13,687,0 04.60 17,720,477.64 13,012, 445.16 25,221.16 109,872^ 62 August 113,229.99 13,160,9 17.28 20.290.722.29 30,087, 233.13 13,573.00 99,665, 675.69 September 822,459.58 12,257,2 40.13 45,843,514.53 14,299, 226.04 842.056.56 128,064, 496.84 October... 695,092.43 22,884,7 16.98 9,276,232.55 36,369, 377.10 30,003.04 108,255. 422.10 November. 420,151.67 8,474,9 61.32 66.722.182.30 14,483, 884.21 32,053.04 143,133: 232.54 December. 273,134.94 38,892,2 59.94 36,703,662.05 10,834, 135.09 872,131.39 133,575; 323. 41 SCHEDULE 7.—Maturities of commercial paper and trade acceptances at time of discount for member banks (rediscounts secured by United States obligations not included). 15 d le a s y s s . or 16 to 30 days. 31 to 60 days. 61 to 90 days. O d v a e y r s 9 . 0 Total. January $4,940,842.86 $2,077,970.58 $2,306,021.32 $1,957,627.97 $35,250.00 $11,317,712.73 8,631,816.10 496,505.97 1,466,247.40 1,517,832.32 40,000.00 12,152,401 79 March 5,365,867.56 1,136,779.20 3,097,966.76 2,414,968.69 36,259.43 12,051,842.64 April 4,084,190.95 447,721.32 1,454,916.12 2,840,466.89 23,310.92 8,850,606.20 May 3,065,000.41 1,300,405.78 2,145,837.92 2,527,223.11 138,342.33 9,176,809.55 June 3,613,275.74 1,645,681.67 2,519,039.94 3,985,465.44 19,959.52 11,783,422.31 July 5,613,633.65 3,123,510.93 5,092,147.32 6,607,342.24 54,742.18 20,491,376.32 August 2,304,369.95 1,621,607.80 1,913,107.87 1,535,285.90 72,132.78 7,446,504.30 September 3,565,719.54 1,221,534.56 2,597,690.17 2,914,018.82 2,700.00 10,301,663.09 October 1,462,043.39 1,052,532.83 3,268,778.71 2,374,837.39 48,103.04 8,206,295.36 November 2,905,282.20 1,276,678.09 2,287,310.10 2,742,662.44 110,511.87 9,322,444.70 December 2,900,648.85 927,088.05 1,979.526.47 4,993,084.08 995,882.27 11,796,229.72 Total 48,452,691.20 16,328,016.78 30,128,590.10 36,410,816.29 1,577,194.34 132,897,308.71 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

292 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. Total Earning Assets at close of Business each Friday, yI V / V / y f f I 1 J r \ i \ I / V ft v 1 ;\ A ['9/8 1 ' ,< IV ^/ ~ V \ i -7 /977, -J V V V r' / -/ V-A '--"' /' ,'•-'* y •*/ *>..-''" y 1917 '*" •*»./ Jan. Feb. Mar. Apr. May June July Aug- .SepA 0c/1. Afcf. Z?<?<T. j CHABT C. .sralloD \ snoilliM ZOO ZOO 190 190 180 160 no 170 160 160 150 ISO HO 140 130 130 120 120 no 110 700 IOO 90 BO 80 80 70 70 60 60 50 50 40 40 30 30 20 20 10 10 Millions Dollars Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTEICT NO. 1—BOSTON. 293 Bills Rediscounted and Member Ba/f/C Collateral Notes held at c 'ose of Buslm ss ea :h Frida^ /• 'V 1^ x V ' » i 1918 iVJ J ',1917 x/ W J r ,\ ^~/\ 19 J 7 ^ /"'^ .-/ •J ——-S Feb, • Mar. Apr. May. June July Aug. Sept, Oct, Nov. Qec. CHART D. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

294 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. SCHEDULE 8.—Acceptance liability of national banks in New England at date of Comp troller's calls 1917-18. 1917 1918 $24,372,000 Mar. 4 $58,373,000 25,459,000 May 10 49,704,000 June 20 33,147,000 June 29 48,599,000 Sept. 11 35,082,000 Aug. 31 48,744,000 Nov. 20 44,500,000 Nov.l 57,937,000 Dec. 31 49.558.000 Dec. 31 ... .. 59.759.000 SCHEDULE 9.—Acceptances. Foreign acceptances purchased. Domestic acceptances purchased. Number. Amount. Number. Amount. 1917 1918 1918 1917 1918 1917 1918 January 90 150 $2,522,546 $5,782,302 20 71 $515,292 $2,219,399 February.. 187 291 4,461,805 8,021,246 19 121 800,416 3,177,431 March 163 245 4,803,854 7,793,672 8 150 353,407 3,332,815 April 17 201 786,937 5,675,454 20 102 458,149 3,263,609 May 233 309 9,077,342 8,060,987 57 194 1,140,471 5,226,176 June 185 165 6,153,140 5,910,878 70 124 2,390,740 3,227,240 July 67 210 2,300,664 7,666,570 22 148 1,102,781 4,301,286 August 228 272 6,068,808 11,280,146 49 269 1,253,165 7,461,252 September. 409 219 10,654,363 11,191,263 102 285 3,958,850 8,492,786 October 97 602 4,179,893 21,493,691 54 437 1,400,099 11,607,466 November. 373 474 7,831,447 17,520,488 79 533 3,505,018 11,314,325 December.. 123 400 3,891,621 15,054,694 329 8,508,144 7,599,840 Total 2,172 3,538 62,732,420 125,451,391 766 2,763 25,386,532 71,223,635 Bankers' accept Trade Foreign Foreign trade acceptances pur ances to create accept trade ac chased. dollar exchange ances ceptances purchased. discounted. discounted. Num Number. Amount. ber. Amount. Amount Amount. 1917 1918 1917 1918 1918 1918 1918 1918 January $1,681,760 February 9 $525,200 623,541 March 40 377,598 1,441,003 April 287,007 May. 2 250,000 901,692 June 3 258,670 1,053,260 July 525,841 $25,994 August 24 $229,553 602,987 September 101 2,020,406 541,833 496,967 October 8 60,733 26 $1,252,666 498,977 590,153 November 50 499,881 12 800,000 454,511 116,565 December 45 597,664 279,430 1 50,000 445,041 Total... . 228 54 3,408,237 11,690,898 39 2,102,000 9,057,453 1,229,679 i In addition, $398,340 of domestic trade acceptances were purchased during August. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 1—BOSTON 295 75 Acceptances held at c/ose of business each Friday. 70 65 60 A 55 - / \ 50 / \ 45 / \ 40 / 1 35 J 1 30 k\ s^J 25 Af\ \J / f v^ 20 K 1 / \ / ,' ^_- VA / K 15 y 1917 Uy <^ v i V r""""•"* y 10 pj ^ \ U'' S \l31U 1917 0 J Jan. Feb. Mar. Apr. May June July —Aug Sept Oct. Nov. Dec. CHART E. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

296 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. SCHEDULE 10.—All banks granted permission to accept up to 100 per cent of their capital and surplus. May 8,1918 Beacon Trust Co Boston, Mass Apr. 14.1915 First National Bank Do. Apr. 24,1918 Fourth Atlantic National Bank... Do. Mar. 30.1916 Merchants National Bank Do. June 7,1915 National Shawmut Bank Do. Dec. 11,1917 National Union Bank Do. May 25,1916 Old Colony Trust Co Do. Jan. 27,1916 Second National Bank Do. July 28.1916 Webster & Atlas National Bank.. Do. Apr. 11,1918 Dedham National Bank Dedham, Mass. Nov. 13.1917 Massasoit-Pocasset National Bank Fall River, Mass Oct. 5.1917 Safety Fund National Bank Fitchburg, Mass. July 1.1918 Phoenix National Bank Hartford, Conn. Nov. 6,1917 Mechanics National Bank New Bedford, Mass. July 12.1917 Blackstone-Canal National Bank.. Providence, R. I. Dec. 17.1918 Merchants National Bank Do. Jan. 25,1918 Springfield National Bank Springfield, Mass. May 4,1916 Merchants National Bank Worcester, Mass. Oct. 27,1917 Hartford Aetna National Bank... Hartford, Conn. Dec. 16,1918 Providence National Bank Providence, R. I. SCHEDULE 11.—Reserve position on first of each month. [000 omitted.] Federal Reserve Total Date. dep N o e s t i ts. n c o ir t c e u s l i a n c li o a m bi b l i i n ty e . d | R r e es q e u r i v re e d . re T s o e t r a v l e . P re e s r er c v e e n . t tion, net. January... $79,306 §73,602 $152,908 $57,197 $86,132 $28,935 56 February.. 76,256 76,434 152,690 57,262 92,886 35,624 61 March 83,041 87,273 170,314 63,973 • 91,455 27,482 54 April 93,416 93,047 186,463 69,914 118,715 48,801 64 May 98,749 102,264 201,013 75,467 136,117 60,650 68 June 101,349 104,603 205,952 77,313 143,790 66,477 70 July 80,819 113,437 194,256 73,661 123,703 50,042 64 August 89,666 127,571 217,571 82,545 113,680 31,135 51 September 91,912 138,783 230,695 87,682 129,624 41,942 55 October... 95,283 151,765 247,049 94,055 132,201 39,146 54 November. 100,105 152,460 252,565 96,020 109,166 13,146 43 December. 110,453 154,007 264,460 100,261 119,385 19,124 45 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 1—BOSTON. 297 Percentage of Reserve against combined Deposit and A/ote Liabjl/'ty at CI ->se of 3us/ne •>s eaci 7 Friday • 60 ,\ \ f \ A J \ \f917^ r V \ /A ^, i\ /' ' V \ /« / \ t \60 \ » \ %1 / ' \ 1917 \1918 \ f \ J \ i t i 40 30 Jan. F*b. Mar. Apr. May June July _ AuSi__ Sept Oct Nov. Dec. 30 % CHART F. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

£98 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. Gold Reserve at close of Business each Friday. 150 150 A 140 140 \ J30 ^ \j \k 130 120 v\ 120 k\ 110 110 ' \ 100 '\ 100 \f] \A, V 90 V 90 I'' \ i / ^ 80 r / •A r-t / V 1917 A 80 <§ y\ 1 70 t i o 70 .---/ V \.._/ •| 60 60 /V\; % /'\' r"\ % 50 SO •**s v / V V V U917 40 40 30 30 20 20 10 10 1 Jan. Feb. MCLK Apr. May Jane ^(K /4*47- 5<?/tf. Oct Nov. Dec. CHART G. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 1—BOSTON. 299 Reserve account of Member Banks at close of business e ach Fn 'day. JSO ISO 14-0 140 130 130 120 120 iw l \ J 110 UA 100 N ^A 100 -A 1) 90 *y /" \, A A A' ^^ I 90 A V N \ / 80 r[191v8 80 ' V i \ A j 70 v' \ N«V r-S V v' \ ' 1 1917 V 1 70 60 60 Jm SO ^ A I * * i i SO ' v' V v' *%j 1917 40 40 30 30 20 20 10 10 Jan. Feb. Mar. Apr. May June July Aug. Sept Oct. Nov. Dec. 1 CHART H. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

300 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. SCHEDULE 12.—Monthly operations of gold settlement fund. [000 omitted.] Gained Loss through through Month. Total credits.1 Total debits.* w se e t e t k le ly w se ee tt k l l e y - fo N r e m t o g n ai t n h ." ments. ments. January $270,559 $276,622 $30,284 $24,221 $6,063 February... 183,990 194,318 17,866 7,538 10,328 March 199,073 216,038 19,333 2,373 16,960 April , 254,995 269,505 16,658 2,148 14,510 May 306,385 300,857 8,005 13,533 2 5,528 June 263,532 259,507 3,700 7,725 2 4,025 July 358,666 328,893 1,957 31,730 2 29, 773 August 297,999 339,433 41,434 41,434 September. 289,366 276,077 7,944 21,233 2 13,289 October 506,839 468,274 14,104 52,669 2 38,565 November.. 383,406 380,351 24,688 27,743 2 3,055 December.. 434,652 477,126 42,474 42,474 Total. 3,749,467 3,787,001 228,447 190,913 37,534 1 Does not include direct transfers. 2 Loss. SCHEDULE 13.—New national banks taking out stock in the Federal Reserve Bank. Mattapan National Bank, Boston, Mass Feb. 19,1918 Manufacturers National Bank, Cambridge, Mass Apr. 3,1918 State National Bank, Lynn, Mass... June 1,1918 SCHEDULE 14.—Member trust companies. City. Name of bank. D m a i t t e t e a d d . MAINE. Bangor Merrill Trust Co Mar. 14,191« Portland Fidelity Trust Co Mar. 18,1918 MASSACHUSETTS. Menotomy Trust Co Nov. 9,1918 Arlington American Trust Co Sept. 4,1917 Boston Beacon Trust Co Jan. 15,1918 Commonwealth Trust Co Feb. 12.1917 International Trust Co June 9,1917 Liberty Trust Co Mar. 12.1918 Metropolitan Trust Co Dec. 7.1917 Old Colony Trust Co Aug. 24,1915 State Street Trust Co Dec. 26,1918 U. S. Trust Co Apr. 9.1918 New England Trust Co Dec. 14,1918 Cambridge Charles River Trust Co Dec. 11,1917 Harvard Trust Co Mar. 6,1918 Fitchburg Fitchburg Bank & Trust Co Feb. 25.1917 Holyoke Hadley Falls Trust Co Jan. 19.1918 Lawrence Merchants Trust Co Feb. 27,1918 Lynn Security Trust Co Oct. 14,1918 Newton Newton Trust Co Nov. 6,1917 Norwood Norwood Trust Co A Aug. 14.1917 Salem Naumkeag Trust Co... zr. Oct. 28.1918 Winchester Winchester Trust Co May 29,1917 Worcester Worcester Bank & Trust Co Dec. 26,1917 RHODE ISLAND, Providence Industrial Trust Co Nov. 9,1917 Rhode Island Hospital Trust Co Mar. 13,1918 Union Trust Co Sept. 24,1918 CONNECTICUT. South Manchester Manchester Trust Co Dec. 30,1918 New Haven Union & New Haven Trust Co.. Dec. 15,1917 Waterbury Colonial Trust Co Apr. 6,1918 New Britain New Britain Trust Co Aug. 21,1918 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 1—BOSTON. 301 SCHEDULE 15.—Member trust companies compared with total trust companies in this district. Member trust companies. Total trust companies.1 Number. Cap p i l t u a s l .2 s ur Deposits. Number. Cap p i l t u a s l .2 s ur Deposits. Maine 2 $1,731,000 $16,789,000 50 $10,148,000 $79,784,000 New Hampshire 14 2,117,000 15,769,000 Verm ont 36 4,838,000 50,164,000 Massachusetts 22 43,915,000 385,395,000 100 75,757,000 547,032 000 Rhode Island 3 17,019,000 134,214,000 13 20,557,000 145,733,000 Connecticut 4 3,306,000 14,675,000 64 16,803,000 108,195,000 Total 31 65,971,000 551,073,000 277 130,220,000 946,677,000 1 Figures from 1918 edition "Trust companies." 2 Includes undivided profits. SCHEDULE 16.—Banks granted fiduciary powers under section 11 (k) of the Federal Reserve Act. Jan. 21 National Bank of Bellows Falls Bellows Falls, Vt. Jan. 28 City National Bank Berlin, N. H. Feb. 9 County National Bank Bennington, Vt. Apr. 24 First National Bank Reading, Mass. Do... Springfield National Bank Springfield, Mass. Do... Phoenix National Bank Hartford, Conn. June 3 Blackstone National Bank Uxbridge, Mass. July 27 Peoples National Bank Barre, Vt. Aug. 20 National Union Bank Boston, Mass. SCHEDULE 17.—Banks granted fiduciary powers under section 11 (k) of the Federal Reserv Act, as amended by the act of Sept. 26, 1918. Date. Name. Location. Dec. 4 Manufacturers National Bank1. Waterbury, Conn. Do... Phoenix National Bank i Hartford, Conn. Do... Waterbury National Bank Waterbury, Conn. Do... First National Bank New Haven, Conn. Do... do Hartford, Conn. Do... do.1 Wallingford, Conn. Dec. 6 .do.1. Boston, Mass. Do... Merchants National Bankl Worcester, Mass. Do... do Salem, Mass. Do... Webster & Atlas National Bank l. Boston, Mass. Do... Safety Fund National Bank 1 Fitchburg, Mass. Do... Crocker National Bank i Turners Falls, Mass. Do... First National Bank i. Gardner, Mass. Do... Mechanics National Bank i New Bedford, Mass. Do... Mechanics National Bank i Boston, Mass. Do... Fourth-Atlantic National Bank i.. Do. Do... Central National Bank Lynn, Mass. Do... Canal National Bankl Portland, Me. Do... Merchants National Bank * Leominster, Mass. Do... Chicopee National Bankl Springfield, Mass. Do... Second National Bank* Boston, Mass. Do... Bay State National Bank Lawrence, Mass. Do... Peoples National Bank * Marlboro, Mass. Dec. 12 Chapin National Bank1 Springfield, Mass. Do... Manufacturers National Bankx... Lynn, Mass. 1 Supplementary application for additional fiduciary powers. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

302 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. SCHEDULE 18.—Amounts due to member banks and rediscounts for member banks, by States. Reserve accounts. Ratio of re Rediscounts. discounts to re Dec. 31,1918.1 serve accounts, Dec. 31,1917. Dec. 31,1918. Dec. 31,1918. Maine $3,317,195.05 $4,155,555.98 $1,126,936.85 27.11 New Hampshire 2,203,338.09 2,265,575.13 447,057.80 19.73 Vermont 1,558,536.24 1,560,675.31 605,506.90 38.79 Massachusetts 63,691,658.07 76,358,009.76 9,134,642.09 11.95 Rhode Island 5,526,049.59 9,272,003.10 1,146,850.23 12.36 Connecticut 6,544,638.54 8,188,378.02 373,462.57 4.56 Total 82,841,415.58 101,800,197.30 12,834,456.44 12.12 i Does not include rediscounts secured by United States obligations or member banks' collateral notes.- SCHEDULE 19.—Reserves of national banks in New England as reported by Comptroller of the Currency. Date. r T es o e t r a v l e. R r e e q s u er ir v e e d . r E es x e c r e v s e s . Dec. 31,1917 $59,948,000 $55,557,000 $4,391,000 Mar. 4,1918 57,001,000 55,866,000 1,135,000 May 10,1918 61,274,000 56,021,000 5,253,000 June 29, 1918 56,392,000 54,900,000 i 1,492,000 Aug. 31, 1918 59,032,000 59,041,000 1 9,000 Nov. 1, 1918 63,115,000 63,472,000 357,000 i Deficit. SCHEDULE 20.—Condition of national banks in New- England on dates of comptroller's calls j 1918. [000 omitted.] Net Borrowed Date. r r a e e w m s u q e p u h o r o i i v u c r n e e h n d t i s . Loans. in R F B c f e e l r a d s u o e n e m d r k r i v a n , e l g r e e B in l d s o c i e s r l w r c u o o d h w u i e n n e re g t d s , , bo T in r o r g t o s a w . l a b t P R o B e F r e r r a s e o e n c d w r e k e v n . e r e a t d l rediscounts. Mar. 4.. $696,469 $661,860 $73,467 $2,890 $76,357 96.2 Mayl.. 697,779 714,788 64,741 4,186 68,327 93.9 June 29 705,450 735,411 33,068 5,140 38,208 86.5 Aug. 31 734,418 694,072 43,138 4,132 47,270 91.2 Nov. 1. 786,518 797,579 112,878 1,877 114,755 98.4 SCHEDULE 21.—Comparison of items reported by member banks in selected cities, 1918. [000 omitted.] United Loans se o N f u b m an b k e s r . S c o t u a w r te n it s e i e d s s e . S c U u ta r n t e e i d t s e s b d e y l O o t a h n e s r . m N p a o e n t s d i t d d s e . e Reserve. curities. Jan. 1. $28,426 $44,142 $659,419 $528,147 $56,722 Feb.1. 31,978 40,800 701,823 603,074 60,214 Mar. 1. 53,693 31,613 691,976 602,747 58,993 Apr. 5. 47,335 34,528 728,383 611,766 61,727 May 3. 75,865 33,582 772,229 662,882 66,720 June 7. 60,543 52,816 771,650 666,094 63,158 July 5. 55,943 52,346 784,842 650,476 61,931 Aug. 2. 75,875 47,228 776,760 658,741 65,967 Sept. 6 101,476 40,029 762,252 659,755 63,782 Oct. 4. 154,322 40,475 768,186 683,727 72,065 Nov. 1. 120,530 116,826 784,349 682,006 66,732 Dec. 6. 100,816 110,075 757,899 696,756 74,897 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 1 BOSTON. 303 SCHEDULE 22.—Certificates of indebtedness sales and payments. THIRD LOAN CERTIFICATES. Number of days Date. Due. c R ( e p a n e t t r e ) . Allo s t e m ll e . nt to Total issued. Pa c id r e f d o i r t . by fin d b a r e l a f w w or a i e t l h of de posits. Jan. 22 Apr.22 4 $30,000,000 $20,025,000 $17,580,000 42 Feb.8 May 9 i 35,000,000 29,134,000 24,870,000 46 Feb. 27 May 28 33,000,000 35,369,000 30,059,000 43 Mar. 20 June 18 33,000,000 53,690,000 49,264,500 33 Apr. 10 July 9 35,000,000 89,731,000 36,084,000 27 Apr. 20 July 18 35,000,000 36,468,000 27,167,000 32 Total 201,000,000 214,417,000 185,024,500 FOURTH LOAN CERTIFICATES. Oct. 25.. $68,000,000 $64,590,000 $58,593,000 Nov. 7.. 65,000,000 56,273,500 51,922,000 Nov. 21. 43,300,000 48,267,500 45,165,000 Dec. 5... 43,300,000 49,509,000 46,100,000 Jan.2... 43,300,000. 57,424,000 52,885,000 Jan.16.. 52,000,000 54,710,000 51,103,000 Jan.30.. 43,300,000 50,378,500 47,016,000 358,200,000 381,152,500 352,784,000 FIFTH LOAN CERTIFICATES. Dec. 5 May 6 4£ $52,000,000 $47,901,000 $44,200,000 25 Dec. 19 May 20 41 43,300,000 45,010,500 40,400,000 20 Total 95,300,000 92,911,500 84,600,000 1918 TAX CERTIFICATES. Jan. 2 June 25 16,163,500 $13,219,000 71 Feb..L5 do 8,790,500 7,535,000 41 Mar. 15 do 6,735,500 4,864,000 38 Apr. 15 do r... 6,071,500 4,051,000 43 May 15 do 24,578,000 22,238,000 34 Total 62,339,000 51,907,000 1919 TAX CERTIFICATES. July 15.. $12,025,500 $10,353,000 Mar. 15.. 88,728,000 72,700,000 100,753,500 83,053,000 SCHEDULE 23.—Distribution by issues of certificates of indebtedness sold. THIRD LIBERTY LOAN. National banks. Trust companies. Other banks and indi Total. viduals. Dated. Per Per Per N b u e m r. Amount. ce o n f t N b u e m r. Amount. ce o n f t N b u e m r. Amount. ce o n f t N b u e m r. Amounts issue. issue. issue. Jan. 22 109 $12,131,000 61 45 $7,407,000 37 14 $487,000 2 168 $20,025,000 Feb. 8 261 16,902,000 58 111 11,072,000 38 23 1,160,000 4 395 29,134,000 Feb.27. . 247 20,681,500 60 140 14,130,500 39 23 557,000 1 410 35,369,000 Mar. 20. 232 36,031,500 67 115 16,842,000 31 30 816,500 2 377 53,690,000 Apr. 10. 168 27,757,000 70 90. 10,768,000 27 21 1,206,000 3 279 39,731,000 Apr. 22. . 184 22,669,500 62 104 12,253,000 34 25 1,545,500 4 313 36,468,000 Total. 1350 136,172,500 64 1 193 72,472,500 34 182 5,772,000 2 1625 214,417,000 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

304 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. SCHEDULE 23.—Distribution by issues of certificates of indebtedness sold—Continued. FOURTH LIBERTY LOAN. National banks. Trust companies. Other b v a i n d k u s a a ls n . d indi Total. Bated. Per Per Per N b u e m r. Amount. ce o n f t N b u e m r. Amount. c o en f t' N b u e m r. Amount. ce of n t N b u e m r. AmOunt. issue. issue. issue. June25. . . 304 $39,817,500 62 162 $22,545,500 35 35 $2,227,000 3 501 $64,590,000 July 9 310 30,953,500 55 162 21,064,500 37 54 4,255,500 8 526 56,273,500 July 23... 286 24,191,000 51 138 22,191,500 45 58 1,885,000 4 580 48,267,500 Aug. 6 . 296 26,178,000 53 157 19,900,500 40 90 3,430,500 7 543 49,509,000 Sept. 3 290 32,199,000 56 161 21.421,500 37 102 3,803,500 7 553 57,424,000 Sept. 17 | 294 28,702,500 53 145 22,425,500 41 86 3,582,000 6 525 54,710,000 Oct. 1. . 234 25,074,000 50 123 23,744,000 47 51 1,560,500 3 418 50,378,500 Total. 1381 207,115,500 54 1237 153,293,000 40 1 120 20,744,000 6 V738 381,152,500 i Actual number of different subscribers. SCHEDULE 24.—Report of payments by credit and withdrawals since Jan. 1, 1918. Payment by Withdrawals. Date. Balance. credit. January. $64,000,000 $78,500,000 Jan. 1,1918 $66,500,000 February 52,000,000 50,000,000 Feb. 1,1918 52,000,000 March 57,000,000 36,000,000 Mar. 1,1918 54,000,000 April 81,000,000 105,000,000 Apr. 1,1918 75,000,000 May 177,500,000 92,000,000 May 1,1918 51,000,000 June 200,000,000 166,500,000 June 1,1918 136,500,000 July 144,000,000 212,000,000 July 1,1918 170,000,000 August 79,000,000 109,000,000 Aug. 1,1918 102,000,000 September 109,000,000 121,000,000 Sept. 1.1918 72,000,000 October 318,000,000 143,000,000 Oct. 1,1918 60,000,000 November 141,000,000 296,000,000 Nov. 1,1918 235,000,000 December 126,000,000 177,000,000 Dec. 1.1918 80,000,000 Jan. 1.1919 29,000,000 Total 1,548,500,000 1,586,000,000 SCHEDULE 25.—1 ledeposits of i nternal-revenu efunc is. EEDEPOSITS. June 11,1918 $3,755,600 June 12,1918 4,747,000 June 13,1918 6,531.000 June 14,1918 10,302,000 June 15,1918 19,160,000 June 17,1918 48,471,400 June 18,1918 17,426,00O June 19,1918 6,755,000- June 20,1918 3,996,000 June21,1918 4,840,000 June 22,1918 857,000 June 24,1918 2,220,000 June 25,1918 1,076,000 June 26,1918 14,465,000 June 27,1918 1 134,000 June 28,1918 785,000 June 29,1918 1,505,000 July 1 and 2,1918 340,000 July 3,1918 v 57,000 148,423,000 WITHDRAWALS. Advance payments . .. $1,113,000 June 27 r 28,706,400 July 2 29,551,600 JulyB 29,665,000 July 9.... 26,724,150 c uyll „.,, 32,662,850 148,423,000 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 1—BOSTON. 305 Due from Depos itart'ei of Public Money at Close of Basin ess ea ch Fridc y- \\ 1 \ M * \/ H\ ^\ AA ¥ 1/9/8 / ^ 'f \^ V r-J \ 1 / 9 1 \ 7 ,"—-»' V s .--/ Jan, Feb. fyfar, Apr, May Jane July Aug. Sept. Oct Nov, Dec. CHART I. 100823°—19 20 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

306 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. Due to Treasurer of the United States atclose of Bust ness < >ach f '/day. 60 \ 55 ii i » 5C j I i 45 I i | I I 40 i i II 35 J J 1 30 i } A i J978 1 HI i\ 2S [II A MH \ 20 A I'V 1 i • 1j \ I \ i 1 1 i ts 1 \ JA/ ; >J j! J k III \ < '1\1/ 10 vA / / \ / * \ i lX\ w y / ^NJ \ \ J / \ „ f i \i i wf\ S O 1S17 \ / V'' 5 JO Jan, Feb. Mar. Apr. May June July SMSH' Sept. Oct. Nov. 1 Dec. j CHART J. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 1—BOSTON. 307 SCHEDULE 26.—Subscriptions to Liberty loan bonds. Third Liberty loan. Fourth Liberty loan. Day. -Total. Day. Total. Apr. 9 $20,421,600 $20,421,600 Sept. 30 $44,290,850 $44,290,850 Apr. 10 15,145,900 35,567,500 Oct. 1 22,867,300 67,158,150 Apr. 11 10,793,700 46,361,200 Oct. 2 29,250,850 96,409,000 Apr. 12 7,325,500 53,686,700 Oct. 3 24,644,300 121,053,300 Apr. 13 7,506,450 61,193,150 Oct. 4 22,544,600 143,597,900 Apr. 15 7,449,100 68,642,250 Oct. 5 24,157,750 167,755,650 Apr. 16 11,691,700 80,333,950 Oct. 7 13,839,150 181,594,800 Apr. 17 10,743,750 91,077,700 Oct. 8 17,521,100 199,115,900 Apr. 18 9,152,100 100,229,800 Oct. 9 21,413,950 220,529,850 Apr. 19 10,155,300 110,385,100 Oct. 10 14,942,150 235,472,000 Apr. 20 3,319,050 113,704,150 Oct. 11 14,050,400 249,522,400 Apr. 22 9,112,450 122,816,600 Oct. 12 10,683,750 269,206,150 Apr. 23 8,881,350 131,697,950 Oct. 14 17,027,850 286,234,000 Apr. 24 12,356,350 144,054,300 Oct. 15 12,294,000 298,528,000 Apr. 25 10,488,100 154,542,400 Oct. 16 39,075,950 337,603,950 Apr. 26 12,319,750 166,862,150 Oct. 17 37,837,750 375,441,700 Apr. 27 17,056,400 183,918,550 Oct. 18 34,988,400 410,430,100 Apr. 29 12,619,450 196,538,000 Oct. 19 48,696,950 459,127,050 Apr. 30 12,539,450 209,077,450 Oct. 21 85,193,050 544,320,100 May 1 12,893,700 221,971,150 Oct. 22 30,748,050 575,068,150 May 2 22,200,850 244,172,000 Oct. 23 57,153,700 632,221,850 May 3 18,159,850 262,331,850 May 4 21,917,050 284,248,900 May 6 21,047,850 305,296,750 May 7 17,348,450 322,645,200 May 8 11,091,600 333,736,800 May 9 20,800,450 354,537,250 SCHEDULE 27.—Liberty loan subscriptions through Federal Reserve Bank of Boston. Size of subscription. Third loan. Fourth loan. $50 to $10,000 $189,597,650 $264,402,700 $10,050 to $50,000.. 50,892, 800 111,497,450 $50,050 to $100,000. 32,220,050 68,348,650 $100,050 to $200,000 24,219,200 54,750,950 $200,050 and over.. 57,607,550 133,222,100 Total 354, 537, 250 632, 221, 850 SCHEDULE 28.—The Liberty loans. Number of subscribers. Subscriptions. State. Third loan. F l o o u an rt . h Third loan. Fourth loan. Maine 77,259 118,270 $18,348,100 $27,694,150 New Hampshire 55,632 103,905 14,252,000 21,979,050 Vermont 41,972 62,038 9,330,750 15,315,450 Massachusetts 508,401 910,228 228,329,750 405,354,500 Rhode Island 104,324 128,101 28,717,700 61,350,300 Connecticut 164,767 325,092 55,558,950 100,528,400 Total 952,355 1,647,634 354,537,250 632,221,850 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

308 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. SCHEDULE 29.'—Liberty loan subscriptions of principal cities of New England. Third loan. Fourth loan. Estimated Estimated number of Amount. number of Amount. subscribers. subscribers, Boston 201,900 $77,202,500 139,336 $139,800,000 Brockton 14,144 2,733,500 14,315 4,817,400 Cambridge 22,316 4,585,725 46,555 8,800,850 Fall River 18,886 5,463,950 16.967 8,931,650 Hartford, Conn 29,780 21,045,250 72,286 36,422,600 Holy oke, Mass 12,707 2,934,500 57,730 5,836,850 Lawrence, Mass 40,707 4,415,500 85,892 7,402,200 Lowell, Mass 9,712 4,192,350 31,266 8,354,350 Lynn, Mass 8,967 3,391,550 89,336 6,476,075 Manchester, N. H.. 15,734 4,054,500 11,879 7,386,340 New Bedford, Mass 23,315 5,840,800 96,652 8,707,550 New Haven, Conn. 35,763 7,702,550 64,102 15,*507,600 Portland, Me 25,549 4,278,850 58,571 6,054,550 Providence, R. I... 100,619 17,486,450 73,029 38,103,300 Somerville, Mass... 8,102 1,583,700 18,516 3,076,000 Springfield, Mass... 38,048 7,502,500 88,926 16,147,350 Waterbury, Conn.. 30,497 5,759,350 73,141 8,977,200 Worcester, Mass— 43,779 8,462,400 145,986 19,239,150 SCHEDULE 30.—Character of Liberty loan payments. SECOND LOAN. By credit, Date. By cash. Go d v e e p r o n s m it. e nt i C n e d r e ti b f t i e ca d t n e e s s o s f . Total. A in c t c e r r u es ed t. Cash sales $14,245,150.00 $3,084,100.00 $17,329,250.00 4,055,738.00 5,153,004.00 9,208, 742.00 Nov. 15 55,630,311.50 170,328,176.50 $40,435,000.00 266,393,488.00 Dec. 15 14,183,028.28 59,793,191.55 73,976,219.83 $106,799.83 6,397,980.02 35,750,717.02 42,148,697.04 419,597.04 Total 94,512,207.80 274,109,189.07 40,435,000.00 409,058,396.87 526,396.87 THIRD LOAN. Cash sales.. $13,056,150.00 $23,208,900.00 $13,415,500.00 $49,680,550.00 May 9 18,579,541.07 108,941,621.43 43,172,500.00 170,693,662.50 May 28 7,851,470.42 36,551,792.35 4,911,500.00 49,314,762.77 July 18 10,483,010.07 39,176,294.97 49,659,305.04 Aug. 15 5,671,195.46 30,426,761.62 36,097,957.08 Total 55,641,367.02 238,305,370.37 61,499,500.00 355,446,237.39 $908,987.39 FOURTH LOAN. Cash sales $14,694,150.00 $53,235,500.00 $4,700,000.00 $72,629,650. 00 Oct. 24 42,556,496.13 214,358,733.87 94,247,500.00 351,162,730.00 Nov. 21 12,374,479.64 67,543,038.43 6,985,500.00 86,903,018.07 Dec. 19 8,396,782.16 41,185,043.87 49,581,826.03 Total 78,021,907.93 376,322,316.17 105,933,000.00 560,277,224.10 $323,224.10 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 1—BOSTON'. 309 SCHEDULE 31.— Transactions during the fourth Liberty loan payments. [000 omitted.] Total Wee 1 k 9 1 e 8— nd ing, c a t L i m o o n f i p l n d i u b o e a c n e a n a y c a t n r t t c e e t s o y r s f . d t p R q e w a f o u e p r ie i s a i d o t d e i l h e s t i s s - i . t b i m f y P i e c a c n a y e t t s e r s. c C a c e s a r h t t e i e f s d i . M r c c b e o r e s a a e i u m e n c n a n r s b k t v e s s e e . , r c c L r o r a e o i e u d n n a a n d i s n s t e s s . , d d t W r f a e a r r p i o w i o t m e h a s s i l . s T T o t u r d f u r r e a r e t i i r s y c n a s o t . s s f th i c n m i f G r n t l u o l e e g a s n e a , u n e i d n r t g t i h Oct.18 $20,900 $16,400 $7,000 $4,200 $24,700 $13,000 $9,900 Oct. 25 337,800 211,500 $96,200 $44,300 - 17,500 7,000 25,900 1,000 16,000 Nov 1 29,000 14,400 4,500 500 219,100 13,400 35,400 24,000 * 20,900 Nov 8 48,500 42,300 7,800 21,800 89, 700 1,000 3,200 Nov. 15. 13,000 9,400 215,200 19,100 52, 800 23,000 5 7,600 Nov. 22 88,800 67,500 6,300 | 72,300 21,000 15,900 92,500 45,000 a 12,500 Total 538,000 361,500 107,000 117,100 19,000 3 81,400 321,000 107,000 »11,900 i Does not include direct transfers. 2 Decrease. 3 Rediscounted with other Federal Reserve banks $65,000,000 of this amount. SCHEDULE 32.—Liberty loan conversions. Exchanged into— Exchanged by other Issued. Federal Outstand Reserve ing. 3Js. 4s. 4|s. banks. First loan interim certifi cates: Allotment 1265,017,900 $167,453,400 $63,828,100 $35,582,000 $769,100 Other Federal Reserve banks 2,614,700 Total 287,632,600 167,453,400 63,828,100 35,582,000 769 100 First 3Js 267,632,600 9,390,150 $878,350 1156,888 750 First 4s 73,218,250 48,832,800 i 24,384,450 Second 4s 408,530,000 317,633,550 190,896,450 1 Difference between amount issued by this bank and amount presented for conversion. SCHEDULE 33.—Bond and certificate deliveries. THIRD LIBERTY LOAN. Bond Bonds Certificates 1918 tax coupons. registered. of in certifi debtedness. cates. Pieces. Pieces. Pieces. Pieces. $50 1,090,798 12,531 100.. . . 409,412 23,131 500 42,282 4,911 6,873 1,460 1,000 131,732 4,573 34,449 7,075 5,000 5,206 511 10,674 2,609 10,000 5,243 965 9,656 3,561 50,000.. 57 100,000 27 266 14,268 Total 1,684,673 46,706 61,918 28,973 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

310 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. SCHEDULE 33.-—Bond and certificate deliveries—Continued. FOURTH LIBERTY LOAN. Bond Bonds Certificates 1919 tax coupons. registered. of in certifi debtedness. cates. Pieces. Pieces. Pieces. Pieces. $50 759,726 2,560 100 384,967 4,923 500 42,096 1,159 9,237 1,842 1,000 162,838 1,185 43,724 6,794 5,000 6,425 140 20,938 2,927 10,000 8,396 212 17,722 4,053 50,000 , 24 1)0,000 8 509 374 Total 1,364,447 10,211 92,130 15,990 SCHEDULE 34.— United States certificates of indebtedness redeemed from Jan. 1, 1918, to Dec. 31. 1918. d C em as p h t i r o e n. - pay B m on e d n ts. F i o s r s u n e e s w . m d G e r o n a t v w e w a r l n i s t . h pay T m a e x nts. Total. Jan. 22 to Apr. 22 $15,099,000 $3,859,000 $2,218,000 $21,176,000 Feb. 8 to May 9 14,444,000 $14,271,000 28,715,000 Feb. 27 to May 28 24,402,500 9,686,000 1,566,500 35,655,000 Mar. 20 to June 18 45,549,500 7,974,000 53,523,500 Apr. 10 to July 9 22,229,000 17,618,500 39,847,500 Apr. 22 to July 18 24,759,500 11,950,000 36,709,500 Nov. 30 to June 25 7,804,000 $8,046,500 15,850,500 Jan. 2 to June 25 8,106,500 9,550,500 17,657,000 Feb. 15 to June 25 4,993,000 4,237,500 9,230,500 Mar. 15 to June 25 2,282,500 4,837,500 7,120,000 Apr. 15 to June 25 1,221,500 6,262,000 7,483,500 9,596,000 5,402,000 14,998,000 June 25 to Oct. 24 45,233,500 17,781,500 63,015,000 July 9 to Nov. 7 46,575,000 9,067,000 5,000 55,647,000 July 23 to Nov. 21 38,098,500 8,638,000 706,000 47,442,500 Aug. 6 to Dec. 5 (called Nov. 21) 36,713,500 11,560,000 319,000 48,592,500 Sept. 3 to Jan. 2 (called Dec. 19) 34,459,0d0 21,922,500 135,000 56,516,500 Sept. 17 to Jan. 16 17,337,500 1,015,000 18,352,500 Oct. 1 to Jan. 30 20,684,000 885,000 21,569,000 Aug. 20 to July 15 8,797,500 200,000 8,997,500 Nov. 7 to Mar. 15 424,000 424,000 Total 381,566,500 168,490,000 15,721,500 3,784,500 38,960,000 608,522,500 SCHEDULE 35.— War-savings stamps issued during year 1918. Number of Number of war savings thrift Total stamps stamps amount sold. issued. issued. Boston 117,279 335,884 $568,996.51 Massachusetts (outside Boston) 179,710 607,295 898,686.36 Maine 141,331 454,659 702,120.10 166,109 292,279 766,391.04 125,649 159,433 564,398.28 Rhode Island 177,705 443,445 852,386.21 Connecticut 159,265 705,705 839,184.29 Sundries 7 Total 1,067,055 2,998,700 1 5,192,162.79 1 Amount issued by Federal Reserve Bank of Boston. The Treasury Department reports total sales of $54,685,000 in this district up to Dec. 1.1918. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 1—BOSTON. 811 SCHEDULE 36.—Capital Issues Committee. Approved. Disapproved. Number. Amount. Number. Amount. District opinions rendered: Public service 4 $276,000 Municipal - 27 770,775 2 $34 800 Industrial 17 1,115,225 5 370,000 Total 48 2,162,000 7 404,800 Central opinions rendered: Public service 49 52,046,971.47 1 200,000 Municipal 45 10,377,045.83 6 1,600 000 Industrial 97 99,428,796.67 21 28,874^080 Total 191 161,852,813.97 28 30 674 080 Applications withdrawn. Applications trans ferred. Number. Amount. Number. Amouut. Public service. 4 $4,053,775 Municipal 3 2,140,000 2 $180,000 Industrial - 15 5,670,950 2 1,150,000 Total 22 11,864,725 4 1,330,000 Building operations postponed during the war, 43; total, $10,895,200. Bank loans for capital purposes approved, 25; total, $9,172,791. Public-service corporation notes registered, $43,844,025. SCHEDULE 37.—Federal Reserve notes issued by Federal Reserve agent. Outstanding on m f o i n rs t t h . o f Issu m ed o n d t u h. r ing R in e g t ir m ed o n d t u h r . Net increase. January $77,296,820 $5,540,000 $2,102,700 $3,437,300 February.. 80,734,120 9,420,000 1,374,585 8,045,415 March..... 88,779,535 7,760,000 1,086,050 6,673,950 April 95,453,485 11,980,000 2,245,535 9,734,465 May 105,187,950 8,300,000 4,075,610 4,224,390 June 109,412,340 10,500,000 3,239,000 7,261,000 July 116,673,340 16,500,000 2,452,150 14,047,850 August 130,721,190 13,500,000 2,556,530 10,943,470 September. 141,664,660 16,000,000 2,707,300 13,292,700 October 154,957,360 14,040,000 2,287,450 11,752,550 November. 166,709,910 2,640,000 7,012,K0 M,372,190 December.. 162,337,720 13,900,000 7,251,390 6,648,610 Total . 130,080,000 38,390,490 91,689,510 1 Decrease. SCHEDULE 38.—Number of Federal Reserve notes issued and retired by denominations. Outstanding Outstanding Jan. 1, 1918. Issued. Retired. Dec. 31,1918. Fives 2,566,832 5,292,000 2,412,092 5,446,740 Tens.. 4,047,743 4,980,000 1,844,266 7,183,477 689,754 2,236,000 260,851 2,664,903 Fifties 74,987 70,000 18,725 126,262 Hundreds 64,408 56,000 17,341 103,067 Total 7,443,724 12,634,000 4,553,275 15,524,449 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

312 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. SCHEDULE 39.—Inter-district Federal Reserve note movement. Bank. Re fr c o e m iv — ed Sent to— N re e t t u e r x n c e e d s . s New York $15,729,700 $27,182,800 $11,453,100 Philadelphia.. 2,176,000 2,374,800 198,800 Cleveland 340,970 2,145,540 x 1,804,570 Richmond 734,750 1,620,600 885,850 Atlanta 494,850 622,250 127,400 Chicago 1,017,250 2,219,810 1,202,560 St. Louis 403,515 380,400 i 23,115 Minneapolis.. 114,500 338,700 224,200 Kansas City.. 61,600 450,000 388,400 Dallas 419,450 176,500 i 242,950 San Francisco. 167, 720 420,300 252,580 Total... 21,660,305 37,931,700 16,271,395 . i Excess received. SCHEDULE 40.—Principal items from statement of selected banks, Dec. 28, 1917, and Dec. 27, 1918. [000 omitted.] Loans Net de b N b a e u r n m k o s f . c i U c S n a e n t d t r a e i t e i s t t b f e e i o t s d - f o U s S T e w t n t c o i a n i e u t t t e s a r e e d i l s d . a s U b S n e d o n t c b a n i u y t c t d r e e e e s s d r d I A i m m l n l l o e a v a o n n e n t d s t h s s t . e r| R R F B e e w e a s s d i e e n e t r r h k r v v a . e e l ! ] ! C v a a s u h l t i . n| 'd i r s w e e m p s h o c a e o n o i n r s c m v d i h t e s p T o d i s e m i t e s . G p m o o d v s e e i e n t r t s n . tificates. puted. Boston: 1917 '$14,188 $36,753 |$489,467 $46,537 $18,369 l$408,104 $28,433 $33,767 1918 $45,921 61,172 69,055 462,268 45,727 17,231 ' 449,855 22,227 26,762 Outside of Boston: 1917 14,238 7,389 169,952 10,185 6,711 120,043 48,452 5,707 1918 14,374 34,420 16,069 175, 720 10,346 7,597 127,298 50,117 7,596 SCHEDULE 41.—Amount of checks handled by the transit department. [000 omitted.] On other banks in this district. On banks in Boston Clearing House. Received from Received from Boston banks. other banks. 1917 1918 1917 1918 1917 1918 January $128,625 $341,288 $63,272 $76,733 $19,540 $44,692 February 130,031 288,249 52,326 66,470 17,938 43,562 March .' 168,669 347,749 64,364 91,118 21,788 47,853 April 195,460 405,416 67,646 94,130 26,957 54,561 May : 209,634 442,529 71,096 98,310 32,686 59,995 June 269,424 580,929 70,958 100,511 36,389 127,931 July 288,942 501,702 74,640 116,980 34,370 75,392 August 289,565 456,349 72,286 142,491 34,834 82,741 September 264,028 425,558 67,992 132,202 34,079 83,837 October 292,272 612,811 83,132 150,409 38,927 126,280 November 357,385 598,042 84,105 142,774 41,100 131,603 December 353,688 587, 616 82,047 142,664 42,845 135,317 Total 2,947,723 5,588,238 853,864 1,354,792 381,453 1,013,764 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 1 BOSTON. 313 SCHEDULE 41.—Amount of checks handled by the transit department—Continued. On Treasurer of On banks in other Total. United States. districts. 1917 1918 1917 1918 1917 1918 January . $3,918 $53,693 $63,589 $115,432 $278,944 $631,838 February 2,467 49,067 69,303 84, 305 272,065 531,653 March 3,950 62,452 86,059 92, 665 344,830 641,837 April 3,886 64,188 103,066 113,823 397, 015 732,118 May 3,777 82,473 103,043 101,513 420,236 784,820 June 10,121 89,943 125,289 98,339 512,181 997,653 July 21,625 105,785 129,308 129,361 548,885 929,220 August 23,867 156.068 116,865 115,132 537,417 952,781 September 31,243 108,790 95,340 117,629 492,682 868, 016 October 39,531 124,663 97,404 145,919 551,266 1,160,082 November 49,831 123,211 98,228 122,909 630,649 1,118,539 December 51,981 147.094 93,276 90,160 623,837 1,102,851 Total 246,197 1,167,427 1,180,770 1,327,187 5,610,007 10,451,408 SCHEDULE 42.—Collateral department—Coupons cut. Number Number Amount of banks. of coupons. of coupons. May 257 62,559 $651,341 June 142 15,941 127,297 July 74 2,191 47, 320 August 73 1,637 43,135 September. 217 65,150 318,607 October... 114 6,424 158,672 November. 307 37,137 708,569 December.. 230 14,530 179,257 Total 1,414 205,569 2,234,198 SCHEDULE 43.— Discount rates. Secured by United States obligations. Agricul Maturities Maturities l t i u v r e a - l s a to n c d k Trade ac Carrying of 15 days of 16 to 90 paper, 91 ceptances. coupon rate or less. days. d m a o ys n t t h o s 6 . 15 d le a s y s s . or 1 d 6 a t y o s 9 . 0 - lo L a f n i o b u b e r r o th t n y d, 16 to 90 days. Dec. 12, 1917 4 5 5 4 3i 4 Jan. 7, 1918 4 5 5 4-i 4 Apr. 8, 1918 4 42 5 4V 4 41 Oct. 1,1918 4 42 5 4* 4 4i 4 SCHEDULE 44.—Money rates in Boston, 1918. January. February. March. April. May. June. Demand money G-6 6-6 6-6 5-6 5-6 5-6 Commercial paper discounted: 90 days or under 5.1-6 5J-6 5|-6 52-6 52-6 5f-6 Over 90 days 52-61 5|-6]; 51-61 5f-6i 52-61 Commercial paper purchased: 90 days or under 5^-6 5|-6 5^-6 5f-6 5|-6 6-6 Over 90 days 5f-6i 5|~6i 5|-6i 51-61 5|-61 51-61 Bank borrowings 5J 5i 5J 5i 5£ 6i Acceptances: Indorsed 3I-4| 4i-4i 51-41 4J-4A 4J-4A Unindorsed 4-41- 4-41 41-4J 4A-41 4-&-41 4A-4& Year money 6 6 6 6 6 6 Town notes 4.75-5.63 5.06-5.39 5.0 -5.74 5.06-5.72 4.69-5.50 4.43-5.04 Loans secured by United States Digitized for FoRblAigSatEioRns 4-5 4-5 4-5 4-5 4|-5 41-5 http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

314 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. SCHEDULE 44.—Money rates in Boston, 1918—Continued, July. August. Se b p e te r. m October. No b v e e r. m De b c e e r m . Demand money 5J-6 6-6 6-6 6-6 5J-6 Commercial paper discounted: 90 days or under 5J-6 5f-6 5f-6i 6-6i 6-6J 5f-6i Over 90 days 5J-6 5i-6 SHHfc 6-6J 6-6| 6-££ Commercial paper purchased: 90 days or under 4f-6 6-6 6-6J 6-6* 6-6J 5f-6i Over 90 days 6-6 6-6 6-6£ 6-6J 6-6J 6-6i Bank borrowings 5| Acceptances: 6J Indorsed 4-4f 4-4J 4-4J 4fW* 4iV4A Unindorsed A -A T, *rV4A 4A-4J 4i-4A Year money 6 6 6 6 6 6 Town notes 4.22-5 4-4.38 4.19-4.65 4.70-4.91 4.24-4.60 4-4.37 Loans secured by United States obligations 41-5 4|-5 41-5 41-5 4i-5 4i-5 SCHEDULE 45.—Bank clearings in New England. [Figures in thousands of dollar.-; from clearing-house cities.]x 1915 1916 1917 1918 1918 2 January 774,008 1,040,224 1,237,922 1,349,779 February. 670,835 952,310 1,063,847 1,108,908 March 783,254 1,099,879 1,159,100 1,288,689 April 851,617 1,060,009 1,199,335 1,414,114 803,485 1,076,603 1,200,624 1,619,670 June 780,657 1,056,426 1,251,661 1,720,029 July 829,872 1,041,174 1,308,358 1,588,308 August 702,790 890,888 1,195,002 1,481,533 September 704,006 940,031 1,107,1Q4 1,306,456 October 1,008,557 1,172,621 1,374,657 1,751,890 2,477,136 November 1,019,200 1,298,280 1,447,019 1,650,132 2,581,875 December 999,816 1,234,647 1,365,268 1,631,683 2,967,972 Total 9,928,097 12,863,092 14,909,897 17,911,191 8,026,983 i As reported in the Commercial and Financial Chronicle. 2 As reported to Federal Reserve Board, includes all checks on members of clearing houses, whether "cleared" or not. SCHEDULE 46.—Building activity in New England. First half Second half year. year. Total. 1912 $102,960,000 $68,207,000 $171,167,000 1913 86,174,000 113,291,000 199,465,000 1914 89,212,000 82,655,000 171,867,000 1915 88,475,000 74,471,000 162,946,000 1916 106,890,000 74,998,000 181,888,000 1917 99,950,000 109,150,000 209,100,000 1918 73,142,000 125,732,000 198,874,000 Average 92,400,000 81,063,000 161,913,000 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT HQ. 1—BOSTON. 315 SCHEDULE 47.—Business through the port of Boston. [000 omitted.] Exports. Imports. Excess o p imports. 1917 1918 1917 1918 .1917 1918 January $24,193 $20,910 $32,419 $31,656 $8,226 $10,746 February 22,390 11,294 21,743 15,965 1647 4,671 March 19, 707 21,108 24,816 27,106 5,109 5,998 April 20,509 22,369 25,810 27,527 5,301 5,158 18,034 23,889 20,306 35,147 2,272 11,258 June 14,882 17,262 21,158 37,554 6,276 20,292 July 13,913 20,725 16,415 22,611 2,502 1,886 August 17,286 12,936 14,350 17,422 12,936 4,486 September 10,815 10,534 14,117 17,674 3,302 7,140 October 14,495 19,326 8,033 25,096 16,462 5,770 November 13,513 19,257 9,356 26,243 i 4,157 6,986 December 19,141 22,987 26,658 22,862 7,517 1 125 Total 208,878 222,597 235,181 306,863 26,303 84,266 1 Excess of exports. SCHEDULE 48.—Commercial failures in New England.1 1916 1917 1918 Number. Liabilities. Number. Liabilities. Number. Liabilities. 220 $1,994,616 151 $1,424,353 135 $1,516,696 New Hampshire 63 223,117 49 380,768 38 243,919 Vermont 59 602,544- 48 422,831 36 363 240 Massachusetts 928 10,326,675 895 10,777,064 739 13 010 340 Rhode Island 113 586,464 105 503,488 124 683*456 Connecticut 307 2,132,970 319 8,642,146 272 4,167,709 Total 1,690 15,866,386 1,567 22,150,650 1,344 19,885,360 i Figures as reported by R. G. Dun & Co. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 2—NEW YORK. PIERRE JAY, Chairman and Federal Keserve Agent. RESULTS OF OPERATION, BALANCE SHEET. Schedule 1 shows the condition of the Federal Reserve Bank of New York on December 31, 1918, 1917, and 1916. The increase in nearly every item in the balance sheet for 1918 is an indication of the increased rise by member banks of the facilities of the Federal Reserve Bank in order to maintain their reserves and to provide the loan expansion which the financing of the war has necessitated. The various items will be commented on in detail under the appropriate headings. A table and chart showing by weeks the volume of notes and deposits, together with the course of the reserve percentage, are given on pages 382 and 383. INCOME AND EXPENSE. The income and expenses of the bank during the years 1918 and 1917 are shown in Schedule 2. The great expansion in the business of the bank during 1918 has been reflected not only in increased income, but also in increased expenses, although earnings naturally increased far more than expenses. Most of the items of income are self-explanatory. The amount of service charges received decreased because these charges, imposed to cover the cost of collecting checks, were abandoned on June 15. The items of expense have been further subdivided during 1918, many items heretofore included under general expense having been placed under separate headings. Almost ever}^ item reflects the expansion in staff, space and equipment which the immense volume of business transacted during the year has necessitated. At the close of the year, with the approval of the Federal Reserve Board, a further amount of $299,375 was set aside in the deprecia tion reserve account to provide against certain penalties for cancel ing leases in the Equitable Building should the bank erect its own building, and to provide against possible unascertained losses. Also, under the same approval, $803,800 was charged off, represent ing the estimated value of buildings now standing on the site pur- 317 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

318 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. chased during the year. Dividends at the rate of 6 per cent for the year were paid; $7,672,676.44 was carried to surplus, bringing the surplus up to the 40 per cent of paid-in capital which the present law permits; and $12,795,214.57, being the balance of the net earn ings, was set aside as a franchise tax payment subject to the call of the Treasury Department, pending the consideration by Congress of a bill recommended by the Federal Reserve Board which would permit larger amounts of the net earnings of Federal Reserve Banks to be retained as surplus. The expenses shown in the foregoing statement do not include the expenses of the departments of the bank performing its fiscal agency functions or the expenses of the Liberty loan and certifi cate of indebtedness selling and publicity organizations, all of which are reimbursed directly by the Treasury Department. DISCOUNT RATES. The discount rates established by the bank during the year and the rates at which bankers' acceptances have been purchased in the open market are shown in Schedule 3. Throughout the year the rate policy of the bank has been necessarily influenced by the policy of the Treasury Department with respect to the interest rates on the bonds and certificates of indebtedness which it has sold. The only change occurred on April 6, when an under standing was reached, with the approval of the Federal Reserve Board, under which all of the Federal Reserve Banks established a rate of 41 per cent for discounting 90-day paper secured by United States Government obligations. This rate, conforming to the coupon rate of the third and fourth Liberty bonds, was continued for the balance of the year. At the same time the rate of this bank on 90-day com mercial paper was advanced to 4f per cent, at which level it was still below the market rate for such paper, as it has been ever since the United States entered the war. While the rates of the Federal Reserve Bank normally should remain at or above the market rate, under prevailing abnormal conditions this was impracticable, since it was felt that a further advance in the 90-day rate on commercial paper might affect unfavorably the rates at which the Government was financing and that, in view of the Government's policy of financing at low rates of interest, the Federal Reserve Bank should maintain steady and correspondingly low discount rates and endeavor in indi vidual cases to check any tendency toward taking advantage of the low rates for the mere purpose of profit making. Owing to the differential of one-half of 1 per cent between the rate on commercial paper and the rate on Government-secured paper, the bulk of the paper held by the bank has been of the latter class, which was natural in any event, since it was primarily the Govern- Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 2—NEW YORK. 319 ment borrowings which compelled the banks to discount so heavily at the Federal Reserve Bank. Since early in 1915 the bank has established maximum and minimum rates within which it has purchased bankers' acceptances. This policy was adopted at the inauguration of open-market transactions, as it did not seem wise at that time to establish a fixed discount rate on these bills. During the past year, however, the development of the market has reached a point at which a stabilizing influence was necessary and fixed rediscount rates as shown in the table for bankers' acceptances were accordingly established on October 1, under authority • of section 13 of the Federal Reserve Act. While the banks have not yet needed to exercise their rediscounting privilege under this rate, as the market rate has been steadily lower, its establishment has undoubtedly exercised a beneficial influence on the stability of openmarket operations. During the year member banks, especially those in New York City, have continued to use the 15-day rate very extensively. In fact, the great bulk of their accommodations has been for periods of 15 days or less and many of the largest banks borrow for from one to three days only. By providing for these " day-to-day'' loans, the Federal Reserve Bank has furnished its members a recourse as quick and flexible as the call-money market, which, in view of the wide fluctuations in their liabilities caused by Government financing, has been of great service to them and enabled them not merely to secure promptly such large accommodations as they have required from time to time, but to pay them off with equal promptness and facility. The arrange ments made permitted these short discounts and advances to be effected on either commercial or Government-secured paper and at the same rate. INVESTMENTS OF THE FEDERAL RESERVE BANK OF NEW YORK DURING 1918. DISCOUNTS, ADVANCES, AND PURCHASES, AND THEIR RELATION TO RESERVES. As the war progressed it became increasingly necessary for the banks to have recourse to the Federal Reserve Bank. The following figures show the maximum use of its credit facilities in each of the Liberty loan financing periods to date: Maximum discounts,advances, and investments. Financing period. Date. First Liberty loan $278,649,000 June 19,1917 Second Liberty loan. 522,363,000 Nov. 30,1917 Third Liberty loan... 655,587,000 May 10,1918 Fourth Liberty loan. 958,293,000 Dec. 30,1918 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

320 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. Each of these high points was followed by a period of contraction which, however, never reached the preceding base, so that the expansion was progressive, though not continuous. While this heavy borrowing from the Federal Reserve Bank was caused fundamentally by Government financing, its direct relation was to the condition of the reserves of member banks rather than to the sales of Government securities. As the Government deposits created by the sales of securities and not requiring reserves to be maintained against them were transformed through Government disbursement into private deposits upon which reserves had to be maintained, the banks had to borrow to create these additional reserves. Furthermore, interior banks throughout the year con tinued to meet withdrawals of Government deposits by drafts on their New York correspondents, thereby causing a constant flow of funds from New York to the interior and requiring the New York banks to replenish their reserves at the Federal Reserve Bank until the funds thus withdrawn were returned again through Govern ment transfers. The following chart shows the gold holdings of the bank during the year and the aggregate amount of its loans and discounts. Aside from the gradual but steady increase of the gold held by the system, the fluctuations in the amount of gold held by this bank represent its gains or losses through the settlement of balances with other Federal Reserve Banks. The closeness with which the borrowings of member banks follow the fluctuations in the gold holdings of this bank clearly substantiates the views expressed in the foregoing paragraph. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 2 NEW YORK. 321 rsos^i /?£S£/ey£ SAA/X OF MEW vo/r/c 100823°—19 21 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

322 ANNUAL REPOKT OF THE FEDERAL RESERVE BOARD. The increase in the note and deposit credits granted by the Federal Reserve Bank of New York during the year has at times reduced the reserve of the bank very materially. At the close of 1917 the average reserve against all liabilities was 61.7 per cent. At the close of 1918 this had fallen to 44.5 per cent. The corresponding figures for the entire Federal Reserve system are 61.8 per cent and 50.6 per cent. These figures are far more significant than those of any individual Federal Reserve Bank, since through rediscounting or the sale of bills or other securities, the reserves of the various Federal Reserve Banks are so readily equalized. Twice during the year, in order to strengthen its reserve position, this bank sold bills, aggregating in all $97,274,364.32, to other Federal Reserve Banks. At other times during the year it rediscounted paper totaling $67,680,848.93 for other Federal Reserve Banks in order to strengthen their reserves. These transactions indicate the effectiveness of the transfer of re serves through the Federal Reserve system as a whole concurrently with the operation of the system as twelve separate units, each especially equipped to understand and care for the needs of its own district. The figures of the reserves of this bank and of the Federal Reserve system when the United States entered the war and at the close of 1918 are as follows: Dec. 27,1918. Apr. 6, 1917. Percent. Amount. Per cent. Amount. Federal Reserve Bank of New York 42.5 $637,295,000 92.9 $426,814,000 All Federal Reserve Banks 50.6 2,146,219,000 84.7 962,662,000 The following is a statement of member bank discounts and advances during 1918 and 1917: 1917 Number Number of items. Amount. of items. Amount. January 5,552 $299, 141,079.59 148 $598, 162.06 February.. 7,441 267; 801,380.25 171 1,925,3 51.05 March. 7,882 321, 342,092. 09 237 3,062,5 83.13 April 6,446 1,460,6 81,317.41 267 2,439,2 23.25 May 10,802 2,181,1 43,351.44 523 6,545,2 73.25 June 11,653 2,290,6 84,904.35 2,034 552,976,4 58.11 July 14,323 1,935,0 41,787.56 1,346 262,366,1 05.28 August 15,016 2,306,0 86, 869. 85 1,254 53,024, 394. 21 September. 11,993 2 — 616,075.93 1,625 319,543, 993.34 October 13,498 3; 713,3 05, 674.14 2,544 2,382,893, 110.97 November. 15,457 2,948,2 91,085.09 3,213 2,663,667, 291.90 December.. 8,975 3,918,4 02, 840.07 9,122 262,232, 974.93 Total. 129,038 24,535,538,457.77 22,484 6,511,274,921.48 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 2 NEW YORK. 323 The immense volume of discounts and advances shown arises from the practice which many member banks pursue of borrowing for a few days, often only one day, with renewals, as required, for varying amounts. On several occasions the bank has purchased from the Treasury special certificates of indebtedness payable within a few days, aggre gating in all $3,133,000,000, in order to supply the special needs of the Treasury pending the transfer of funds from other Federal Reserve Banks or the withdrawal of funds from depositary banks. The largest amount thus held at any one time was $195,000,000. In order to facilitate the purchase of certificates of indebtedness by nonmember banks, the bank has been ready to purchase such cer tificates, with an agreement on the part of the nonmember Bank to repurchase within 15 days. The largest amount thus held at any one time was $12,313,500 on November 19. In order to assist in making a more stable carrying market for bankers' acceptances for houses which deal in such bills, the bank has from time to time during the year purchased bills at slightly above current rates from such houses with an agreement on their part to repurchase within 15 days, the largest amount of such pur chases at any one time having been $8,222,000, on October 9. This, however, has been considered as a purely temporary policy during the development period of the discount market. The following figures give certain data concerning the discounts and advances of 1918 and 1917: Number of applications received 14,831 2,513 Amount of applications received $24,552,063,650.44 $6,528,455,050.30 Amount of applications accepted and discounted or advanced upon $24,535,538,457.77 $6,513,225,285.60 Largest application $135,000,000.00 $167,000,000.00 Smallest application $5.02 $50.00 Number of pieces of paper discounted or advanced upon 129,038 22,484 Largest piece of paper discounted or advanced upon $135,000,000.00 $147,000,000.00 Smallest piece of paper discounted or advanced upon $5.02 $25.00 Average size of notes discounted or advanced upon $190,141.96 $289,682.67 Number of banks rediscounting 522 322 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

324 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. BANKERS ACCEPTANCES AND THE DISCOUNT MARKET. The monthly purchases of bankers' acceptances and indorsed trade bills by this bank for itself and other Federal Keserve Banks during 1918 have been as follows: For account of Federal Re For account of other Fed serve Bank of New York. eral Reserve Banks. Month. Number Number of items. Amount. of items. January 4,154 $80,010,6 07.18 819 $13,130,0 89.64 February.. 3,910 91,970.8 34.83 540 11,618,3 04.90 March 3,175 75,850,8 40.39 447 8,294,5 22.94 April 2,775 57,952,7 53.91 286 3,175,2 14.24 May 2,866 61,379,5 09.85 320 4,024,4 31.26 June 1,573 39,567,5 61.89 442 7,540,5 28.48 July 2,172 62,862,7 28.69 430 11,714,8 55.80 August..... 3,190 91,862,0 18.00 574 14,002,1 26.66 September. 4,211 115,774,4 88.26 849 18,736,1 91.24 October 3,414 105,567,7 88.66 1,605 42,586,6 04.09 November. 3,519 100,177,1 48.45 1,018 21,587,6 04.22 December.. 2,202 62,521,1 43.43 812 18,454,0 71.11 Total.. 37,161 945,497,423.54 8,142 174,864,544.58 CLASSIFICATION. Import and export 609,705,533.69 113,870,892.74 Domestic 246,957,105.74 59,348,612.76 Indorsed trade bills of foreign origin 16,224,317.49 1,391,552.93 Bills drawn to furnish dollar exchange. 5,452,702.24 246,400. CO Domestic trade acceptances 3,543,131.62 7,086.15 Repurchase agreement 63,614,629.76 Total.. 945,497,423.54 174,864,544.58 Increased and more general use of the bankers7 acceptance has been a striking development of the past year, especially in financing domes tic transactions and in the storage and movements of the grain and cotton crops. The volume of foreign drawn bills appearing in this market, while reflecting the increased trade with the Orient, has not increased proportionately with the volume of domestic bills, due in part to shipping difficulties and in part to the settlement of a greater volume of both imports and exports by cash rather than by drawing bills. As compared with estimates of $400,000,000 to $500,000,000 of bankers' acceptances and foreign trade bills on American merchants outstanding at the end of 1917, it is now believed that there are between $700,000,000 to $800,000,000 of bankers' acceptances alone outstanding in the United States. The following figures, taken from published reports of institutions in this Federal Reserve district, show the amounts of acceptance liabilities of national banks, trust companies, and State banks on the dates indicated: Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 2—NEW YORK. 325 September, 1918. Sep 1 t 9 e 1 m 7 b . er, Sep 1 t 9 e 1 m 0 b . er, National banks $141,934,391.42 $73,717,000 $44,300,877 Trust companies 124,038,547.88 91,424,509 68,588,558 State banks 9,841,533.62 7,355,910 2,787,995 Total 275,814,472.92 172,497,419 115,677,430 These figures, however, do not indicate the full measure of increase for the country. The number of well-known banks located in other cities that are now accepting is greatly increased and much of their paper comes to New York for discount. With the increase in number of accepting banks and volume of bills circulating, the number of bill buyers has likewise increased. Out-of-town banks are buying more freely, and many of those which are now acceptors have also become buyers. Dealers report in creased activity and interest in almost all parts of the country. The turnover of some houses has more than doubled that of last year. One house reports sales of $720,000,000 for this year as against $358,000,000 in 1917. During the year there have been accessions to the number of houses that specialize as dealers in bankers' acceptances. Also several cor porations organized to operate as discount houses have been formed. Some of them are in operation and others are still in process of organi zation. Also several important foreign trade banks have come into existence and are operating. Perhaps, however, more significant of the trend of intelligent opinion as to the future of New York as an international financial center is the number of foreign banks and bankers that have already established or are about to establish branches or relations here. The outstanding development of the year 1918 toward the firmer establishment of an open discount market in America was recognition of the fundamental necessity for a stable volume of call and short time money available to dealers and discount houses at rates related to the open-market rates for bills as distinguished from rates for loans against investment securities or so-called brokers' loans. While money of this character has occasionally been available, it was not until a leading banking house publicly announced its policy of lending freely on bills at preferred rates—a policy subsequently adopted by several other institutions and houses—that money in sufficient volume was available to enable dealers to carry portfolios of bills without the risk of such interest losses as to render it impracticable for them to operate other than as mere traders. As has already been stated, the Federal Reserve Bank has from time to time purchased bills from dealers, under their agreement to repurchase within short periods, at a rate of 4J per cent per annum. Their recourse to this Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

326 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. aid has been moderate and not continuous. It is hoped that more and more banks, recognizing the advantages to the country and to themselves of a broad and active open market, and the important relation of dealers in bills to the development of such a market, will add their support by providing dealers normally with the necessary funds at rates closely related to the current bill rates, as is customary in foreign markets. Bill rates in the open market have been the most stable and the lowest of all money rates. As compared with short-time United States certificates of indebtedness bearing interest at from 4 per cent to 4 J per cent, the primary market discount rates on bills of the bestknown names has not exceeded 4J per cent for the 90-day maturity and has ranged down to 3 J per cent. The ruling rates were, during January and February, 4 per cent; from February to July, 4J per cent to 4J per cent, the higher rate being reached during the period of Federal income tax payments; after slight recessions rates advanced gradually to from 4f per cent to 4J per cent in October when fourth Liberty loan financing was at the peak; later, rates declined, on easier money conditions, to 4| per cent at the year's end. Generally speak ing, the rates referred to were those quoted for unindorsed bills which are offered for resale to investors at slightly lower rates of yield. The Federal Reserve Bank has maintained its policy, established last year, of buying practically only indorsed bills and at rates related to those established by competition and supply and demand in the open market. In purchasing it has continued to emphasize its pref erence for short bills by paying rates graduated down to published minima, according to maturities. While its purchases have sup ported and stabilized the market, its rates have been generally above the market for maturities other than the shortest period. Consequently the average maturity of bills held by the bank has been reduced and a wider distribution of bills to an increased number of buyers has been effected, with a correspondingly increased diversification of indorsers on bills held by the bank. The Federal Reserve Bank as a further stabilizing step, and in addition to its open-market purchases, established special rediscount rates for the rediscount of bankers' acceptances under section 13 of the act. These rates, established October 1, remain unchanged and are: Maturities up to 15 days, 4 per cent; maturities 16 to 60 days, inclusive, 4J per cent; maturities 61 to 90 days, inclusive, 4J per cent. During the year other Federal Reserve Banks did not participate as freely as heretofore in the open-market purchases of the New York bank, owing to increased demands in their respective districts and also to the greater activity of their own member banks in both accept ing and buying bills, many of which found their way to their district banks. Nevertheless there have been many transactions between Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 2 NEW YORK. 327 Federal Reserve Banks, the Federal Reserve Bank of New York having bought from and sold to other Federal Reserve Banks, as well as having bought in the market for their account. During the year the banking laws of the State of New York were modified to permit savings banks to invest in bankers' acceptances. While a few of them have purchased from time to time in the open market, the volume of their purchases has not been in proportion to their indicated desire to carry portfolios of bills, as funds which otherwise would have been employed in this way have been largely invested in United States Treasury certificates of indebtedness. TRADE ACCEPTANCES. The increased number of domestic trade acceptances offered for rediscount at the Federal Reserve Bank not only is evidence of the progress of the movement, but indicates also that commercial banks are discounting them for customers more freely and are purchasing them in the open market. The amount rediscounted and purchased by the Federal Reserve Bank during 1918 was $31,903,092.74. Much progress has been made during the year in the development of the trade acceptance plan of closing accounts in domestic mer chandise transactions. Under the direction of the American Trade Acceptance Council many informal meetings were held at which plans for adapting the system to particular lines of trade were dis cussed and developed. Much was also accomplished through economic discussions at more formal gatherings. Trade associations, chambers of commerce, and credit associations have formally recommended the use of the trade acceptance and emphasized the importance of the movement. Many trade and business associations have formally recommended that their mem bers adopt the system, and in some lines selling terms have been modified to include settlement by trade acceptances in all trans actions not settled by spot cash or short discounts. In others modified terms, attractive to the buyer, have been offered as induce ments to their use. It has been estimated that more than 4,000 representative concerns now use the system. Domestic trade acceptances have appeared in the open discount market more generally this year than before, and where the names are well known they find ready sales at favorable rates. These bills usually come in fair-sized pieces—say, from $5,000 up—and to avoid too large pieces several bills of marketable size are often drawn to cover in their aggregate larger transactions. A new development this year has been the offering in the open market of trade accept ances bearing banking indorsements. This class of bill resembles more nearly the bankers1 acceptance as to the credit involved and commands a lower rate than those not so indorsed. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

328 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. The character, form, and manner of execution of bills offered as trade acceptances for rediscount at the Federal Reserve Bank indi cate that merchants and bankers would do well to give more careful consideration both to the inherent limitation of the instrument to current bona fide transactions between buyer and seller and to technical details, such as legal or official signatures of drawers, acceptors, and indorsers, and the avoidance of change or alteration in date, domicile, or any other of the terms of the bill as drawn. Any such irregularities render the paper practically unsalable in the open market and ineligible for rediscount at Federal Reserve Banks. It is perhaps not unnatural that with many presentations from different points of view,of the theories and practices involved in the establishment of the trade acceptance system some misinfor mation and misunderstanding has developed, but it is expected that with continued study of its problems these will be overcome and disappear. The American Trade Acceptance Council is, in process of reorgani zation into The Acceptance Council, and in its new organization will combine trade acceptances and bankers' acceptances as the dual subject of its activities. UNITED STATES BOND OPERATIONS. In 1917 the Federal Reserve Board did not require Federal Reserve Banks to purchase United States 2 per cent bonds bearing the cir culation privilege from member banks. This policy has been con tinued during 1918. During the year the Treasury has paid off $4,492,000 of 1-year 3 per cent notes previously received by the bank in exchange for United States 2 per cent bonds. The Federal Reserve Bank has purchased $34,955,000 United States 2 per cent certificates of indebtedness of a special character which it has hypothecated as security for Federal Reserve bank notes. MUNICIPAL WARRANTS. During 1918 only one purchase of a municipal warrant was made, the amount being $50,000. MATURITIES. The following statement shows the maturities of discounts and advances held by the bank on December 31, 1918: Discounts or Discounts or advances based advances based Bankers' on commercial on United States acceptances. Totai. paper. securities. Within 15 days $32,804,406.83 $498,635,511.87 $32,258,211.94 $563,698,130.64 16-30 days 4,168,348.13 106,051,692.49 13,011,993.37 123,232,033.99 31-60 days 5,866,121.59 34,093,216.75 27,073,860.31 67,033,198.65 61-90 days 1,934,028.42 13,787,253.61 5,232,567.32 20,953,849.35 Over 90 days... 876.00 876.00 Total.... 44,773,780.97 652,567,674.72 77,576.632.94 774,918,088.63 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTEICT NO. 2—NEW YORK. 329 NOTE ISSUES AND THE ACCUMULATION OF GOLD. Throughout the year Federal Reserve notes have been freely issued, as required by member banks, and the interchangeability of Federal Reserve bank deposits and notes has been maintained as heretofore. The net circulation of Federal Reserve, notes of this bank rose during the year from $397,000,000 to $729,000,000, an increase of $332,000,000. While some part of the increase is due to the policy of exchanging Federal Reserve notes for gold or gold certificates, which has been consistently pursued since the bank began business, the chief cause of the expansion was the demand for more notes with which to carry on the constantly increasing volume of trade at rising price levels. Higher prices and higher wages, with the larger pay rolls and larger amounts of till and pocket money which they necessitate, inevitably cause a large demand for circulating media, and during the war this phenomenon has been common to all the belligerent countries, even in Great Britain, where, as in the United States, settlements are made mainly by checks. A considerable quantity of Federal Reserve notes has been shipped during the year to Central American and West Indian countries for circulation purposes, and since the signing of the armistice the War Department has sent considerable amounts of Federal Reserve notes to France, in order that our returning soldiers may be supplied with American instead of French currency. The note expansion has been perfectly natural and not in any way forced; the notes have been redeemable at all times in gold; and the aggregate increase in the amount of Federal Reserve notes outstanding does not represent a net addition to our circulating media, since a large part of the increase represents merely an exchange of Federal Reserve notes for gold. The amendment of September 26, 1918, now permits the issue of Federal Reserve notes in denominations of $500, $1,000, $5,000, and $10,000. These notes, of which a supply of the $1,000 denomination has already been received, will be of service in enabling the banks to avoid the necessity of paying out gold certificates of large denominations. The redemption of Federal Reserve notes of this bank unfit for circulation during 1918 amounted to $226,722,730. Since August, in order to cooperate with the Treasury Department in its desire to secure silver certificates and break .up the silver which they represent for export to India and other countries, the bank, by authority of the Federal Reserve Board, has issued Federal Reserve bank notes in denominations of $1, $2, $5, and $10. These notes, which are similar to national-bank notes, are secured by special 1-year 2 per cent certificates of indebtedness issued for the purpose to the Federal Reserve banks by the Treasury and held by it Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

330 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. as security for the notes. The amount of Federal Reserve bank notes of this bank issued and outstanding on December 31 was $33,034,000, of which $10,585,000 were fives, $1,434,800 tens, and the balance ones and twos. The total amount of silver notes shipped by this bank to the Treasury Department during the same period was $21,528,000. Both member and nonmember banks have cordially cooperated by sending in silver certificates for exchange into Federal Reserve bank notes at the expense of this bank. In order to assist in accumulating gold, since America entered the war this bank has asked its member banks to sort out gold certificates from incoming cash and send them to the Federal Reserve Bank in exchange for Federal Reserve notes. In this way this bank and its member banks have been able to contribute their share to the in creased gold holdings of the Federal Reserve System. Furthermore, the United States Treasury has continued its policy of returning Federal Reserve notes to banks forwarding gold certificates for redemption. No premium has arisen on gold in this district, and this bank has at all times been ready to pay out gold to its member banks as required by them for purposes consistent with the policy of the Government. Under the provisions of the President's embargo proclamation of December 7, 1917, the Federal Reserve Bank of New York during 1918 forwarded to the Federal Reserve Board 1,163 applications for permission to export gold, silver, or currency aggregating $295,000,000, of which it recommended that 349 applications aggre gating $26,000,000 should be granted. COLLECTIONS AND CLEARINGS, THE COLLECTION SYSTEM. The following table shows the various classes and amounts of checks handled during 1918 by this bank and its check-collection department: [000's omitted in columns headed "amount."] I s t F e e e r m v d s e e o r B n al a o n R t k h e s e . r Ite s o m e t r h s v e e r o d n F i e s d b tr e a i r n c a t k l s s . R i e n Items t o r n i ct b a N n o k . s 2. i n dis Ite C m l s e a o r n in g N e H w o u Y se o . rk N b u e m r. Amount. Number. Amount. Number. Amount. Number. Amount. January 388 $4, in 551,505 $360,051 1,037,390 $843,307 144,012 $1,614,331 February 314 4,543 490,797 288,902 910,890 736, 730 136,040 1,484,633 March. 557 5,460 614,882 384,265 1,144,571 935,942 173,025 1,617,768 April 513 6,394 687,963 411,076 1,266,645 1,026,071 202,939 1,927,746 May 419 6,636 686,939 421,714 1,336,806 1,085,440 240, 871 1,894,694 June 330 3,706 704,897 414,156 1,520,043 1,110,744 350,557 1,849,555 July 286 2,016 867,169 438,666 1,907,089 1,227,186 295, 222 1,903,747 August 240 1,500 891, 802 443,513 2,059,871 1,286,131 254,256 1,952,715 September 216 1,277 910,132 484,428 1,985,111 1,256,126 267,919 2,092,561 October 191 203 941,333 426,656 3,086,818 1,900,815 363,935 2,593,787 240 177 810,338 394,011 3,335,218 1,620,297 349,557 2,214,451 December 165 376 849,563 401,835 3,560,669 1,263,356 408,968 2,238,028 Total 3,859 36,399 9,007,320 4,869,273 23,151,121 14,292,145 3,187,301 23,384,016 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT ^O. 2—NEW YORK. 331 The growth of the check-collection department may best be illus trated by the following figures: Period Number of rGTloa- items handled, 1915 (June 1-Dec. 31). 1,262,211 $1,334,015,772 1916 6, 841,364 5,160,192,000 1917 19,408,179 20,104,527,000 1918 35,349,601 42,581,833,000 The development of the collection department showed greater progress in 1918 than any preceding year. This was due to several reasons: (a) The elimination on June 15 of the service charge of 1 cent per item for collecting checks and cash items; (6) the rule adopted by the New York Clearing House, effective October 1, pro viding that its members should neither pay a higher charge for the collection of checks on banks on the Federal Eeserve par list than would be incurred in collecting such items through the Federal Reserve Bank, nor allow the paying bank to hold back the remittance beyond the day on which the item is received; (c) the abandonment by the New York Clearing House on November 15 of its out-of-town collection system; (d) the increase in the number of banks through out the United States on which checks could be collected by the Fed eral Reserve banks at par, from 17,144 in January, to 18,997 in December. The Federal Reserve Bank of New York has continued to accept at par checks on every national bank, State bank, and trust com pany in the district, although, as stated in the last report, a few of the banks are not yet willing to remit at par and the Federal Reserve Bank has been obliged to collect checks drawn upon them either through express companies or by the establishment of local collecting agencies. The number of these banks on January 1 was 76; on December 31 it had been reduced to 42. The result of the change in the constitution of the New York Clearing House, above referred to, was to make it advantageous to the members of the association to send to the Federal Reserve Bank their out-of-town items on banks that were on its par list. This caused the number of checks handled on banks outside of New York City to increase from 2,895,243 in September to 4,028,151 in October. The prevalence of the influenza epidemic during these months made it impossible to augment the staff of the transit depart ment, even with inexperienced clerks, sufficiently to handle this immense volume of items with promptness and efficiency, and for a few weeks the work fell below the normal standard. Contem poraneously with the great increase during October in the volume of checks actually handled by the department, a large volume of Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

332 ANNUAL BEPOKT OF THE FEDEKAL RESERVE BOARD. checks began to be sent by New York City banks direct to other Federal Reserve Banks for their credit with this bank. While this saved one handling, it complicated the accounting considerably, especially with respect to "returned items/' and for a time added to the difficulties caused by the increased volume. To meet this situation, a staff of about 60 clerks was engaged to begin work at 5 p. m. and to continue until midnight in addition to the normal staff working from midnight to 8 a. m., and the main day staff. These three shifts, together with further subdivision of the work of the department, have solved the main difficulties encountered, and the increased volume of checks, averaging in December 186,706 per day, is now being handled in a satisfactory manner. The staff of the department increased from 152 in January to 445 in December. The facilities of the Federal Reserve Bank are also being increas ingly used for the collection of notes and drafts, both in and out of New York City, the number of such items having increased from 6,201 in January to 13,695 in December. The machinery of the New York Clearing House has facilitated the collection of these items in certain parts of the city, and plans are under consideration which will enable the bank to collect more satisfactorily in other parts of the city. The volume of noncash items, payable in New York City, to be collected by presentation, has been greatly reduced by the action of the New York Clearing House on August 1, which permitted bankers' acceptances and notes to be cleared on the morn ing of the maturity date. The two rules of the New York Clearing House above referred to, effective August 1 and October 1, respectively, had the effect of reducing substantially the " float" carried by the banks and trust companies, as well as that which the Federal Reserve Bank had been compelled to carry. The action of the New York Clearing House on August 12, further reducing the charges which its mem bers are required to impose for the collection of out-of-town checks for their customers, is evidence that the commercial and industrial interests of the country are receiving the benefit of the par collec tion system. Charges on most items which were receivable formerly at a charge of one-tenth of 1 per cent are now discretionary, and on items formerly subject to a charge of one-fourth of 1 per cent the present charges vary from one-fortieth to one-eighth of 1 per cent. GOLD SETTLEMENT FUND. Transactions through the gold settlement fund have naturally grown in volume as Government fiscal operations increased and general business expanded. Banks in other Federal Reserve dis tricts have continued to make their payments on account of deposits Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 2 NEW YORK. 333 arising from subscriptions to certificates of indebtedness and Liberty loan bonds to a very large extent by drawing upon their New York correspondents, thus temporarily drawing funds away from New York. On the other hand, the Treasury has transferred enormous amounts to this bank, which, together with the natural return of funds for redeposit, has substantially balanced the outward flow just mentioned. Payments by this bank to other Federal Reserve Banks through the gold settlement fund amounted to $16,438,319,755.03 during 1918, as compared with $8,692,024,000 during 1917, and pay ments received from other reserve banks totaled $16,499,256,210.79, as compared with $8,426,893,000 the previous year, a net gain by this bank during the year of $60,936,455.76. Instead of weekly settlements, which had previously sufficed, daily settlements were inaugurated July 1, 1918, and these have practically eliminated interim telegraphic settlements through the gold settle ment fund except transfers made for Government account. A sum mary of gold settlement fund operations is given in the appendix (Schedule 17). The importance of this fund, not only for the immense transfers which Government operations have necessitated, but for the daily settlement at par of all interdistrict balances, can not be over emphasized. THE TELEGRAPHIC TRANSFER SYSTEM. Telegraphic transfers of available funds have been made for mem ber banks without limit as to amount, and no charge whatever has been made for the service since the installation of private telegraph wires connecting the Federal Reserve Board, the Treasury Depart ment, and every head office and branch of a Federal Reserve Bank. The volume of these transfers has been as follows: Daily average. Number of Amount. trans fers. January... $49,137,729. 59 February. 50,063,542.32 March 42,693,293.87 April 101 54,739,515.64 May 112 55,045,758.84 June 110 70,647,040.30 July 135 67,710,105.00 August 142 54,046,227.58 September 168 55,639,814.09 October... 188 98,785,077.26 November 187 68,017,973.77 December. 209 86,148,696.73 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

334 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. The transfers handled include not only transactions between banks, but also payments through member banks to individuals. With tele graphic facilities thus made available without charge of private wires, mail transfers have been greatly lessened. The telegraphic transfer system has greatly reduced the buying and selling of domes tic exchange, since funds actually available are transferable at par by telegraph. RELATIONS WITH BANKS IN THE DISTRICT. RELATIONS WITH MEMBER BANKS. In Federal Reserve District No. 2 the number of member banks during the year has increased from 667 to 723, the location and char acter of the members being as follows: Location. N b a a t n io k n s. a l b S a t n a k te s . com T p ru a s n t i es. Total. 14 2 16 New Jersey 128 2 22 152 32 14 16 62 448 16 29 493 480 30 45 555 TotaA 622 32 69 723 During the year 59 State banks and trust companies were admitted to membership, a list of these members being shown in Schedule 4. Four national institutions in the district were liquidated, all for the purpose of combining with other institutions, which either were or became members of the Federal Reserve Bank. Relations with member banks have been necessarily close and con stant. The selling of two issues of Liberty bonds, the numerous sales of certificates of indebtedness, together with the payments by book credit, the withdrawals of these credits, the custody of securities, the correspondence, the accounting and the deliveries in connection therewith, all have served to bring the Federal Reserve Bank into intimate touch with every banking institution in the district, member and nonmember alike. In all of these dealings for account of the Treasury Department there has been no distinction whatever between member banks and nonmember banks; all have been on exactly the same footing. While the Federal Reserve Bank could not discount directly for nonmember banks, it has freely purchased from them whenever necessary, at the same rate at which it was discounting for its member banks, certificates of indebtedness with an agreement on their part to repurchase within 15 days, and under authority of the Federal Reserve Board has offered to rediscount their paper when secured by Government obligations, with the indorsement of Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT KO. 2—MW YORK. 335 a member bank. The response of the banks throughout the district to the requests of the Treasury Department for the purchase of cer tificates and for assistance in selling and financing Liberty loans has been almost without exception of the most generous and enthusiastic nature. The distribution of Liberty bonds effected during 1918 was more general throughout the country than during 1917. The sale of certificates in other districts was markedly better, as the Second Federal Reserve District was called upon during 1918 to take only 38 per cent of the certificates issued, whereas in 1917 it absorbed 64 per cent of the total issued, and the burden on the banks of this district, especially on those in New York City, has been lightened proportionately. There has been no diminution in the patriotic readiness of the banks in New York City during 1918 as during 1917 to do everything in their power to assist the financing of the war. Member banks in New York City and certain other cities have also cooperated with the Federal Reserve Board by sending to this bank weekly reports of condition and of checks paid by them, to form part of the statistics published by the board each week upon banking conditions and transactions. The banking facilities of the Federal Reserve Bank were used very freely by member banks during 1918. More banks rediscounted, used the collection system, transferred funds by wire, and relied on this bank for supplies of currency than ever before. In order to equalize the service given to all member banks and to give all banks in the district facilities as nearly as possible equal to those enjoyed by banks in the same city with the Federal Reserve Bank, this bank on October 8, under authorization from the Federal Reserve Board, paid the cost of shipping currency to and from member banks and undertook to pay charges on all telegrams received from or sent to member banks in connection with currency, exchange transfers, and deposit transactions. There are still many member banks, how ever, who have never used any of the facilities of this bank and do not appear to understand the advantages of so doing. FIDUCIARY POWERS FOR NATIONAL BANKS. Following the amendment to the Federal Reserve Act, enacted September 26, a considerable number of national banks in this district filed applications for authority to exercise fiduciary powers. The number of applications received to the end of the year was 54, of which 34 were approved, 1 disapproved, and 19 were pending. The list of banks which have been granted authority during 1918 to ex ercise fiduciary powers will be found in the appendix (Schedule 18). Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

336 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. CHANGES IN RESERVE REQUIREMENTS. Under the provisions of the amendment of September 26 to section 19 of the Federal Reserve Act, the Federal Reserve Board in October reduced the reserves of member banks in the boroughs of Brooklyn and Bronx to 10 per cent of demand and 3 per cent of time deposits; and the reserves of member banks in the boroughs of Richmond and Queens to 7 per cent of demand and 3 per cent of time deposits; but an institution having branches in a more populous borough is obliged to carry the reserves required for institutions in such borough. RESERVE PENALTIES. Throughout the year, under regulations of the Federal Reserve Board, member banks which have failed properly to maintain their reserve deposits with this bank have been required to pay a penalty upon the amount of the deficiency. The penalty rate, fixed by the Federal Reserve Board at 2 per cent in excess of the 90-day discount rate has been as follows: January, 6 per cent; February to April, inclusive, 6J per cent; May to November, inclusive, 6| per cent. The amount collected was $27,191.89, as compared with $18,585.29 during 1917, and the average number of banks penalized each month has been 21, as compared with 12 during the preceding year. The increase in the number of banks penalized is due to the increased number of members, to mail and clerical difficulties, and to the general preoccupation of the banks with Government work. The Federal Reserve Bank has recently adopted the practice of sending a representative to visit banks which do not appear to under stand completely the requirement for the maintenance of reserves, and it is expected that this will result in smaller deficiencies in the future. RELATIONS WITH NONMEMBER BANKS. As the war progressed and its financial burdens increased, with a corresponding decline in the reserve percentage of the Federal Reserve system, the officers of the Federal Reserve Bank felt it their duty to call to the attention of the nonmember banks the importance of their contributing their strength to the system which was compelled to furnish the entire amount of additional credit required to carry on the war. Accordingly, during the spring and summer a series of conferences were held at the Federal Reserve Bank, attended in all by officers of 134 out-of-town nonmember institutions, at which the operations of the Federal Reserve Bank were explained and the needs of the Government emphasized. These conferences permitted the establishment of personal relations with the officers of the banks in attendance,, and resulted in a considerable number of applications for membership. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT :N0. 2 NEW YORK. 337 The State institutions which became members of this bank during 1918 are given in Schedule 4. At the close of the year, the Federal Reserve Bank of New York had 101 State bank -and trust company members, with total re sources of $3,488,611,000; or 28.4 per cent in number and over 75 per cent in resources of the eligible State banks and trust companies in the district. Figures which have recently been published in the Federal Reserve Bulletin indicate that with regard to the percentage of both the number and the total resources of its eligible State institutions now included within its membership, the New York Reserve District leads all the other districts. As already indicated, the fiscal agency functions of the Federal Reserve Bank have brought it into relationship with all nonmember banks, and their readiness to cooperate in assisting Government financing has been in continuous evidence throughout the year. The cordial relations which have hitherto prevailed have continued throughout the year with the chiefs of the banking departments of the States within the district, who have given many evidences of their desire to assist in the development of the system and to recom mend legislation for the purpose when necessary. RELATIONS WITH NEW YORK CLEARING HOUSE ASSOCIATION. In respect to both measures which would assist Government financing and measures which would make for progress in banking conditions, the relationship of the New York Clearing House Asso ciation with the Federal Reserve Bank has continued to be of a most cooperative nature. During the early months of the year, it became evident that the increasing pressure for credit was leading in some directions toward competitive bidding for deposits which might become injurious to Government financing and to the general banking situation. The New York Clearing House Association invited the Governor of the Federal Reserve Board to address its members upon the subject, and after considerable study, it adopted, effective October 1, the fol lowing schedule of maximum rates which members of the clearing house might pay upon deposits, which were also concurred in by the important institutions not members of the clearing house: (a) On deposits of all banks, trust companies, and private bankers (except mutual savings banks in this district), a rate not in excess of one-half of the 90-day rate of the Federal Reserve Bank of New York; (b) On other demand deposits, not in excess of 3 per cent; (c) On time deposits, not in excess of 3 J per cent. 100823°—19 22 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

338 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. Similar action was subsequently taken by a number of other im portant clearing house associations throughout the country, resulting in the curbing of practices undesirable at any time, and peculiarly unsettling under war conditions. During the summer the Federal Reserve Bank discussed with the New York Clearing House Association the desirability of the pay ment of bankers' acceptances in cash on the day of maturity instead of by check collectible through the clearing house on the following day. After due consideration the association adopted a ruling, effective August 1, permitting members to clear on the morning of the maturity date not only bankers' acceptances, but notes payable at clearing banks. This action saved an immense amount of labor heretofore expended in obtaining checks for accepted drafts and certi fications of notes, and eliminated from banking statements a con siderable volume of one day " float." On August 12 the New York Clearing House Association reduced substantially the exchange charges which its rules compelled its members to impose for collecting out-of-town checks, and on October 1 made effective a rule in substance limiting in accordance with the time schedule of the Federal Reserve collection system the maximum compensation its members might pay out-of-town banks for collecting checks on banks on the Federal Reserve par list. The effect of these rules has already been commented upon on pages 330-332. On November 15, by agreement between the Federal Reserve Bank and the New York Clearing House, the latter abandoned its out-of-town collection department and the former its collection by messenger of items on bankers and firms, not members of the associa tion, who were willing to settle daily for items drawn upon them, through machinery established by the association. This eliminated duplication of services by the two institutions and tended toward consolidation of effort in spheres for which each of the two institutions was respectively especially equipped. Throughout the year there have been a number of joint meetings between the clearing house committee and the executive committee of this bank, and at several other meetings of the clearing house committee the governor or a deputy governor of this bank has been present by invitation. RELATIONS WITH FOREIGN BANKS AND THE PROGRESS OF FOREIGN BANKING. With the prospect during 1919 of a return to more natural and normal conditions in international commerce and exchange, it seems appropriate to outline briefly (a) the arrangements which the Federal Reserve Bank of New York has entered into with foreign banks or Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 2—NEW YORK. 339 Governments; and (b) the progress which America has made, since the beginning of the European War, in the establishment of inter national banking relations. The following relationships, with the approval of the Federal Reserve Board, have been concluded between the Federal Reserve Bank of New York and foreign banks or Governments: Bank of England.—This is an arrangement of a formal character, covered by written agreement, ratified by the directors of the two institutions, covering in detail the basis of the principal operations and making a close, effective, and complete agency. The business thus far transacted has been very limited, but-under the agreement can be extended whenever the need arises. In June, 1917, the Federal Reserve Bank of New York, acting for itself and other Federal Reserve Banks, paid for account of certain English banks a loan of $52,500,000 with interest, maturing in New York, and accepted in return earmarked sovereigns of equivalent value in the Bank of England. During 1918 all but a small amount of this gold was either shipped to New York or furnished to the Treasury Department for the use of the United States Government or its allies in Europe. Bank of France.—A somewhat limited agreement has been effected with the Bank of France which it is hoped and expected by both institutions will soon ripen into a closer relationship. Bank of Italy.—A mutual arrangement has been entered into between this institution and the Federal Reserve Bank of New York, whereby each has appointed the other its correspondent. No business has been or is likely to be transacted between the two institutions as long as arrangements for dealing with exchange problems growing out of the war are dealt with by the Governments of the two nations. Bank of Japan.—Mutual arrangements, similar to those established with the Bank of Italy, have been concluded with the Bank of Japan, and although no active business has yet been transacted, it is hoped that, as in the case of other foreign agents and correspondents, a more active relationship will develop when international commerce resumes its natural course. Philippine National Bank.—In May, 1917, mutual agency appoint ments were effected between the Philippine National Bank and this bank, but as the former has an active branch of its own in New York, the relationship, while ready for operations at any time, is likely to be largely of an emergency character. De Nederlandsche Bank.—During 1918, at the request of the Treasury Department, this bank opened a current account with de Nederlandsche Bank for the purpose of receiving therein, for the use of the Treasury Department, the proceeds in guilders of wheat and other commodities. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

340 ANNUAL REPORT OF 1HE FEDERAL RESERVE BOARD. Sveriges Rikslank and Norges Bank.—During 1918 accounts were also opened with the Sveriges Riksbank of Stockholm and the Norges -Bank of Christiania for purposes analogous to those mentioned in the foregoing paragraph. Argentina.—Early in 1918 an important arrangement was entered into between the United States and the Argentine Governments whereby the Federal Reserve Bank of New York and the Banco de la Nacion appointed each other as correspondents, and the former undertook to receive deposits not exceeding $100,000,000 exportable in gold coin after the proclamation of peace and the deposit of over $16,000,000 of gold-coin then on deposit, earmarked, in New York and since then withdrawn and exported. The purpose of this agree ment, which has proved successful in operation, was to stabilize the badly demoralized exchange situation between the two countries. Bolivia.—A somewhat similar agreement has been entered into between the Governments of the United States and of Bolivia whereby this bank agrees to receive not exceeding $5,000,000 on deposit which may be exported in gold six months after the proclamation of peace. Peru.—Another similar agreement for the stabilization of exchange has been entered into between the Governments of the United States and of Peru with this bank as banker, and with a maximum of $15,000,000 to be received on deposit subject to export at the termina tion of the present embargo. The agreement is not yet in actual operation pending the conclusion of certain minor details. Indian Government.—A very comprehensive arrangement has been made between the United States and the British Government whereby the latter supplies the Federal Reserve Bank of New York, acting for all Federal Reserve Banks, with sufficient rupee exchange each month to enable importers in the United States to pay for necessary imports from India. Up to December 31 the Federal Reserve Bank of New York had received credits aggregating Rs. 192,- 500,000, of which Rs. 187,476,132 have been sold and transferred, with a most satisfactory result in the stabilization of exchange between the United States and the East. Prior to the passage of the Federal Reserve Act, national banks were not permitted to establish branches or agencies abroad, although some of the State institutions had enjoyed this privilege. During the past four years some of the State institutions have extended their foreign branches. The National City Bank of New York with its affiliated institution, the International Banking Corporation, has established many branches abroad, and two banking corporations organized in the United States to carry on banking in foreign countries have established a large number of branches and relations, par ticularly with Latin-American countries. It is probable that further development along these lines will occur during the coming year. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT ]STO. 2—NEW YORK. 341 A list of these institutions with their foreign branches and affilia tions is given in Schedule 5, those marked with a footnote reference being branches which were established prior to the outbreak of the European War. It has been estimated that in July, 1914, not less than 150 foreign banking institutions maintained branches or agencies in London in addition to the home offices of many British banks doing business in all parts of the world. The closest kind of banking contact was thus maintained between London and foreign countries, and con duits were established through which money flowed into and out of London in accordance with the movements of trade and the relation of London rates to those prevailing in other centers. The number of such branches and agencies of foreign banks in New York and other American cities has increased considerably during the European War, but the limited nature of the business which the law of New York State permits branches or agencies of foreign institutions to transact, undoubtedly acts as a deterrent to the progress of the movement. A branch of a foreign bank may receive no deposits in New York State, and several foreign institutions, in order to obtain broader banking privileges than the New York law would permit their branches to exercise have acquired substantial ownership or control of American institutions conducting business in New York City. Among these may be mentioned the Royal Bank of Canada with its interest in the Merchants National Bank of New York; the Banca Commerciale Italiana of Milan with a branch of its own in New York and control of the Lincoln Trust Company of New York, and The Banco di Sconto del Circondario, owning jointly with the Guaranty Trust Company the Italian Discount & Trust Company of New York. A list of the foreign banking institutions having branches or agencies in New York and other American cities at the close of 1918 is given in Schedule 6, those established before the outbreak of the European War being indicated by a footnote. Many of these banks are large lenders of money and purchasers of bills in the United States. Many others are large buyers of bills drawn in foreign countries on American banks, the market for which in such countries is doubtless much facilitated by the existence of branches of local institutions in the United States through which such bills can be readily negotiated. While it may be said that the establishment of such branches or agencies of foreign banks in the United States constitutes competition of a certain kind with Ameri can banks, nevertheless the undoubted widening of banking contact between the United States and foreign countries which they bring, and the beneficial effect of such contact upon the development of dollar exchange and of our discount market, would seem to justify Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

342 ANNUAL, REPORT OF THE FEDERAL RESERVE BOARD. a reconsideration of the situation from a broad point of view and possibly some liberalization of the operations which such institu tions may conduct in New York State. REGISTRATION OF DEALERS IN FOREIGN EXCHANGE. Under the operation of the Executive order of the President, dated January 26, 1918, all dealers in foreign exchange, including bankers, brokers, and exporters and importers who carry accounts in foreign countries or carry accounts in the United States for foreign corres pondents, are required to register with the Division of Foreign Exchange of the Federal Reserve Board through the Federal Reserve Banks of their respective districts. Two thousand six hundred and sixteen such dealers registered through this bank. These dealers were required to apply through this bank for permission to carry out a number of classes of operations and to file weekly or monthly re ports with this bank covering their foreign business. Passing upon these applications and recording these reports has required a large amount of consideration and work. ORGANIZATION OF THE BANK. INTERNAL MANAGEMENT. The problems of management and operation of the Federal Reserve Bank have become increasingly complex and difficult during the past year by reason of the many and important problems arising in con nection with war finance. The directors have given close attention and study to these problems, meeting 53 times during the year. The executive committee, consisting of the governor or deputy governor, the chairman and four directors (all the directors .serving in turn), held 246 meetings, and other committees held 57 meetings. The directors, at their first meeting held in 1918, reelected the officers of the bank for the ensuing year. With the increased activi ties of the bank, many additions to and promotions in the staff, both official and clerical, have become necessary. The following officers have been appointed during the year: Officer. Elected. Date. Formerly- L. F. Sailer Deputy governor (in addition Jan. 3 Cashier. to cashier). J.F.Curtis Deputy governor (in addition Jan. 23 Secretary and counsel. to secretary* and counsel). D. H. Barrows.. Assistant secretary Feb. 6 With Farmers Loan & Trust Co. L. H. Hendricks. Cashier June 26 Assistant cashier. E. R. Kernel Manager of investments June 26 Assistant cashier. L. R. Rounds... Assistant cashier June 26 Acting assistant cashier. I. W. Waters.... Assistant cashier June 26 Chief clerk. J. E. Raaseh Assistant cashier June 26 Manager of partial payment division. J. Emison Assistant auditor Sept. 12 Head of division, auditing department. G. M. Hay ward. Assistant auditor Sept. 12 Head of division, auditing department. W. G. Simpson.. Assistant auditor Sept. 12 Head of division, auditing department. 1 Resigned as secretary to take effect Dec. 31,1918. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 2—NEW YORK. 343 On December 31, 1917, the bank, including the fiscal agency departments, had 16 officers and 829 clerks, 351 of the clerks being women; at the end of 1918 the staff consisted of 23 officers and 2,630 clerks, and 1,495 of the clerks were women. To maintain the efficiency of its organization as a necessary war instrumentality of the Govern ment the directors of the bank took the steps contemplated under the regulations of the selective service act to have deferred classi fication on industrial grounds granted those of its emplo}^ees whose services were regarded as essential to the adequate and effective operation of the bank. A list of the departments of the bank and the number of employees, in each is given in Schedule 7. The employees have responded effectively and in fine spirit to the extraordinary demands upon their time and energy during the year. In spite of heavy tasks, inadequate, crowded, and scattered quarters, and the large number of inexperienced clerks, the work of the bank has been kept up, and in the departments handling Liberty-bond work the apparently impossible has often been accomplished. Owing to the very long hours imposed upon many departments, the earlier practice of allowing supper money to employees working into the evening was discontinued in February, and a fixed allowance for overtime substituted. Living costs having continued to increase because of war conditions, the directors at the end of June and at the close of the year, with the approval of the Federal Reserve Board, supplemented the normal compensation of employees by additional payments as follows: Period January 1 to June 30: 15 per cent on salaries up to and in cluding $1,500; 10 per cent on salaries of more than $1,500, up to and including $5,000. Period July 1 to December 31: 25 per cent on salaries up to and including $1,500; 20 per cent on salaries of more than $1,500 and up to and including $3,000; 15 per cent on salaries of more than $3,000 up to and including $5,000. To keep pace with the growth of the bank and to meet changing conditions, several new departments have been organized and exist ing departments subdivided, as will be noted from the foregoing list. The growing work of the transit department has already been described, and the activities of the discount and other departments may be inferred from the figures which have been given to show the volume of the bank's business. The money department, which handles all currency received on deposit, now has 74 regular employees, of whom 39 are women, and in addition receives assistance from some 60 other employees from this and other banks when overtime work is necessary. Federal Reserve notes handled in this department during the year and paid out again as fit for use have amounted to about $423,816,000, while Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

344 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. unfit notes shipped to Washington for cancellation were 23,164,000 in number and $204,160,000 in amount. The activity of the money-shipping department during the year may also be taken as a fair indication of the enormous increase in the volume of transactions of purely banking character. In the month of January, 1918, the department handled 1,760 shipments, which included currency shipments amounting to $13,091,655, secu rity shipments amounting to $22,342,499, and notes shipped to Washington for cancellation amounting to $11,420,000. In Decem ber the number of shipments was 5,227, which included currency shipments amounting to $34,391,694, security shipments amounting to $41,576,948, and notes shipped to Washington for cancellation amounting to $19,260,000. The Federal Reserve agent's department has been enlarged to include a Federal Reserve examiner, whose duties will include the custody of examination reports and reports of condition of all mem ber banks; investigation and recommendation in connection with applications of national banks for permission to exercise fiduciary powers, or of member banks to accept drafts and bills of exchange up to 100 per cent of capital and surplus; investigation of reports and data submitted with applications made by State banks for membership; examinations, in cooperation with State authorities, of State member banks or banks applying for membership; and special credit investigations of either national or State member banks. An assistant has also been employed to develop work of statistical char acter in the bank, and to report on business and economic condi tions. The duties of the auditing department have been increased, both in importance and extent, by the rapid expansion of the bank's activities. The number of employees in the department has increased from 29 to 106, though some portion of this increase is no doubt tem porary, having been necessary to bring up to date work which had fallen behind during the influenza epidemic in October. The custgdy department was inaugurated at the close of 1917 to take custody of all securities held for the securities department, including the securities of this bank and those held for other Federal Reserve Banks, for member banks, for the Government deposit department, for the bond issue division, and for the third and fourth Liberty loan partial payment associations of New York City banks and trust companies. The department also has custody of the col lateral to loans and discounts held by the bank's discount depart ment. The securities received by the department during the year totaled about $28,000,000,000, deliveries about $26,000,000,000, and the balance held December 31, almost $2,000,000,000. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 2—NEW YORK. 345 A department has been organized to control all purchases of sup plies and the payment of all bills and salaries, and to make reports upon and analyze all expenses for the directors and officers of the bank and the Federal Reserve Board. By the organization of this department substantial economies in buying have been effected, and unnecessary expenditures avoided. A complaint and fraud department, organized in June, has handled several hundred cases of complaint or fraud, principally in connec tion with Liberty loan campaigns and other war-time matters. An employment department, in charge of an assistant cashier, has been created. All applicants for clerical positions are interviewed, and their qualifications and records carefully inquired into, as ap pointments are made entirely upon the basis of merit and no effort is spared to insure the best selections possible. About 100 appli cants for positions, many of whom have called in response to adver tisements inserted from time to time, have been interviewed daily. An efficiency engineer was employed by the bank during the latter part of the year to study the office methods of the larger departments of the bank, and suggest changes where needed. On March 1 a department was organized at the 50 Wall Street office to promote the welfare of the women employees of the bank. Early in September the department was moved to attractive quar ters in the main office at 15 Nassau Street, and enlarged to include a welfare office and a rest room and library. A medical department was established, with a visiting woman physician, a head nurse and two assistants. A cafeteria has also been opened in which about 750 women lunch daily. Well-balanced menus of first quality food are supplied at prices based on actual cost of food plus the cost of service, without allowance for overhead charges. The checks average 24 cents and the cafeteria is proving an unqualified success. Official visitors from the welfare department call upon all absent employees, both men and women, who fail to communicate their reasons for absence from the bank, and this practice has appreciably reduced the num ber of absentees. The Federal Reserve Club, which was originally organized among the employees of the bank in 1914, has grown in membership and the scope of its activities. Its objects have been the promotion of social relations, of good fellowship among the employees of the bank, and educational advancement. The membership now numbers 1,400, including many of the women employees of the bank. The first issue of a monthly magazine, to be called " Federal Reserve Club Magazine," will appear early in January, 1919. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

346 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. BANK PREMISES. The great expansion of the staff during 1918 has made necessary the occupation of additional space. The bank, including the Liberty loan organization, has occupied not only its office on the ground floor, portions of the third, fourth, fifth, eleventh, twentythird, and thirty-first floors, and the entire twenty-fourth and twenty-fifth floors of the Equitable Building, but the entire building at 50 Wall Street, six floors at 37 Liberty Street) and space at 39 and 41 Liberty Street and 19 West Forty-fourth Street, amount ing altogether to 203,258 square feet, as compared with 65,000 at the close of 1917 and 21,625 at the close of 1916. The most unsatisfactory working conditions under which the bank has been operated led the directors of the bank in May, with the approval of the Federal Reserve Board, to purchase a plot of land extending from Liberty Street to Maiden Lane and running eastward from Nassau Street, covering 33,509 square feet, at a cost of $3,121,492.39, upon which the bank will erect its own building in due time. On September 3 a consulting architect was engaged to study the special requirements of the various departments of the bank, in order to obtain data for the preparation of a basis for a competition among architects when the bank is ready to ask for plans for a building. This preliminary work is expected to require almost a year of study. ELECTION OF DIRECTORS. The amendment to section 4 of the Federal Reserve Act, approved September 26, 1918, provided that for the purpose of the election of directors the Federal Reserve Board should classify the member banks of the district into three groups, each group to consist as nearly as may be of banks of similar capitalization, the earlier requirement that the groups should be of approximately equal numbers having been eliminated. The Federal Reserve Board classified the banks of this district as follows: Group 1, banks having capital and surplus in excess of $1,999,000; group 2, banks having capital and surplus not exceeding $1,999,000 and not below $201,000; group 3, banks having capital and surplus below $201,000. The result of this classification was to place in group 1, which will elect directors at the end of 1919, 55 banks, of which all but 5 are in New York City or adjacent territory. Group 2, which will elect directors at the end of 1920, includes 180 banks located in the larger and medium-sized cities of the district, and group 3, which partici pated in the 1918 election, includes 479 banks located for the most part in the smaller towns and villages. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 2—MW YORK. 347 To fill the vacancies caused by the expiration on December 31, 1918, of the terms of Franklin I). Locke and Leslie R. Palmer, as directors of class A and class B, respectively, an election was held from November 19 to December 10. Of the 479 banks in the group which were entitled to vote this year 337, or 70 per cent, voted, a much higher percentage than in any previous election. The follow ing candidates were nominated: For class A director: William S. Gavitt, of Lyons, N. Y.; Robert J. Gross, of Dunkirk, N. Y.; Charles Smith, of Oneonta, N. Y. For class B director: George Alfred Cluett, Troy, N. Y.; Manton B. Metcalf, of Orange, N. J.; Leslie R. Palmer, of Croton-on-Hudson^ N. Y. 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: William S. Gavitt, 109; Robert J. Gross, 21; Charles Smith, 197. For class B director: George Alfred Cluett, 65; Manton B. Metcalf, 71; Leslie R. Palmer, 195. Mr. Smith was declared elected class A director and Mr. Palmer class B director, each for a term of three years, beginning January 1, 1919. George Foster Peabody, class C director, whose term expired Decem ber 31, 1918, has been reappointed by the Federal Reserve Board for a three-year term ending December 31, 1921, and designated deputy chairman of the board for 1919. On December 11 the Federal Re serve Board designated. Pierre Jay as chairman of the board and Fed eral Reserve agent for 1919. MEMBER OF ADVISORY COUNCIL. On January 9 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 1918. FISCAL AGENCY OPERATIONS. The major financial undertaking of the war was the floating of Liberty loans. The problem was not limited to selling bonds; it in volved the creation of a new public state of mind toward investments. The Federal Reserve Banks of the country were the chief agencies through which the Secretary of the Treasury operated in meeting this problem. To them at all times and in all circumstances the Treasury Department gave the fullest support within its power, thereby lighten ing materially the burden of their obligations. They were the adminis trative centers for the work of numberless local Liberty loan commit tees, which, under the leadership of the director of war loan organization in Washington, formed the greatest bond selling organization ever created. To the Second Federal Reserve District fell the necessity of Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

348 ANNUAL KEPORT OF THE FEDERAL RESERVE BOARD. absorbing nearly a third of all the bonds and nearly one-half of all the certificates of indebtedness issued by the Treasury. In the 19 months of our participation in the war the banks and organizations working with the Federal Reserve Bank of New York sold $4,942,374,000 of Liberty bonds, and up to December 31, 1918, cer tificates of indebtedness amounting to $6,512,835,500. On the Federal Reserve Banks, also, rested the responsibility of so administering the financing of the loans that the expansion of credits should be no greater than necessary to insure successful flotation and that the money markets of the country should not suffer dislocation. These problems have been met with measurable success. In the main the Liberty loans have been sold to investors, thus sparing bank funds for commercial and other Government necessities. CERTIFICATES OF INDEBTEDNESS. The sale of certificates of indebtedness in anticipation of the Liberty loans provided the Treasury with funds to meet the current requirements of the war. The Liberty loans converted these short credits into long-time credits and spread them among individual investors. In the 12 months of 1918 the Federal Reserve Bank of New York sold a total of $4,091,260,000 of these certificates of indebtedness. This total includes .both the issues made in anticipation of Liberty loans and the issues of tax certificates. On February 8, in anticipa tion of the third loan, the Secretary of the Treasury notified the banks that its requirements probably would be $3,000,000,000, and therefore requested every bank and trust company to set aside each week 1 per cent of its total resources for investment in certifi cates. The plan, as he then outlined it, was to continue for 10 weeks. On June 12, in anticipation of the fourth loan, the weekly quota was fixed at 1J per cent of the total resources of each bank and trust company. The anticipated requirements were $6,000,000,000. The same rate of subscription was requested during the month of Decem ber in anticipation of the fifth loan. The record of subscriptions in the Second Federal Reserve District during 1918 is given in Schedule 8. The largest volume of these loan certificates outstanding at any one time in this district in the third Liberty loan financing period was $835,938,000. In the fourth Liberty loan financing period the corresponding figure was $1,680,989,000. The banks of the district gave the heartiest response to the call of the Secretary of the Treasury. Of the 1,234 banks, all but 45 sub scribed to the issues. The list of subscribers included even a great majority of the savings banks. Further, the sales were far more Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 2 NEW YORK. 349 general throughout the district and the country than in 1917, when the New York City banks subscribed far in excess of their quota. The satisfactory change to a wider distribution of the fourth loan certificates was the result of intensive work by a newly developed sales organization established along county lines, with a county director as supervisor of sales in his neighborhood. The county directors, each of whom was a representative banker in his own community, met in New York and received the details of the plan from the deputy governor of the bank and the director of sales. Similar meetings were held in the local communities at the call of the county directors, who prosecuted their work with the greatest energy, and in many cases organized county bankers' associations. In addition to discussing with the banks the Government's necessi ties, and the fairness of the plan by which its temporary credit should be supplied by the banks ratably in proportion to their resources, the organization explained to the bankers the method of paying by book credit and of obtaining advances from the Federal Reserve Bank, which many of them had not understood. Stated in tabulated form, the subscriptions allotted to the various classes of banks were as follows: Number Number Per cent of Class of bank. in second subscrib Allotment. total al district. ing. lotment. National 625 616 $2,429,518,000 59 4 State 229 225 272,319,500 6 6 Trust companies 202 195 1,222,246,500 29 9 Savings 178 153 40,529,000 1.0 Individuals and firms 126,647,000 3 1 Total 1,234 1,189 4,091,260,000 100.0 The amounts shown as purchased by individuals and firms are very largely tax certificates purchased in anticipation of the pay ment of income taxes. The banks outside New York City subscribed to fourth loan certificates 108 per cent of their total quota, as against 53 per cent to third loan certificates; the New York City banks subscribed 139 per cent of their quota to fourth loan certificates as against 129 per cent to third loan certificates, despite the fact that the quotas assigned were materially increased. Although advances against certificates purchased by both member and nonmember banks were made, the volume which the Federal Reserve Bank was called upon to carry was comparatively moderate. On October 23, for example, when the certificates preceding the fourth loan were at their maximum $1,681,000,000, the amount carried by the Federal Reserve Bank was $424,000,000, or about 26 per cent of the total. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

350 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. THE LIBERTY LOANS. The record of sales of Liberty bonds in the Second Federal Reserve District shows, in common with other districts, that quotas assigned have been generally exceeded. In the report of the Federal Re serve Bank of New York for last year it was shown that the sub scriptions received far exceeded the informal apportionments made by the Treasury Department, and were also in excess of the amounts ultimately allotted. Subscriptions made in 1918 were accepted in full. The comparative statement showing the results of all loans reflects a remarkable increase in amounts, as well as in the number of indi vidual subscribers. The second district's total sales in the fourth loan were greater than the entire sum accepted by the Treasury from all districts in the first loan. Further, and of greater importance to the financial position of the country is the fact that the subscribers to the third loan were 50 per cent more numerous than in the second. By this fact it is possible to measure the success with which the third loan, as compared with previous loans, was sold to individual investors. The more widely extended sale is also indicated in the reduction of the size of the average subscription of $1,212.29 in the first loan to $366.47 in the third, a figure which, however, was increased in the fourth loan, when the quotas for the country and district were twice as great. The record of the Second Federal Reserve District is as follows: Amount sub Amount al Number of Average Amount Quota. scribed. lotted. subscribers. su t b i s o c n r . i p cap p i e t r a . First loan.. $600,000,000 $1,186,788,400 $617,831,650 978,959 $1,212.29 $94.67 Second loan 900,000,000 1,550,453,450 1,164,366,950 2,182,017 710. 55 123. 69 Third loan. 900,000,000 1,115,243,650 1,115,243,650 3,043,123 366. 47 Fourth loan. 1,800,000,000 2,044.901,750 2,044,901,750 3,604,101 567.39 Hardly less significant than the great growth of the individual sub scriptions from loan to loan is the increase in the number of large subscriptions in the fourth Liberty loan as compared with the third. The number of subscriptions in excess of $10,000 more than doubled, and the number of subscribers in amounts exceeding $200,000 in creased from 430 to 967. Part of this great increase is attributable to the willingness of the banks to extend generous credits to subscribers. The "borrow and buy" campaign, adopted from necessity, was very pro ductive of large subscriptions. The terms made by New York banks allowed the investor to borrow at 4| per cent for 90 days; thereafter the banks made varying agreements with subscribers, some to carry on successive renewals for a year at the coupon rate; others at onehalf of 1 per cent above the Federal Reserve Bank rate. The figures Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 2—NEW YORK. 351 for the third and fourth loans are given in Schedule 9 for purposes of comparison. The work of the banks of the district in the loan campaigns was most enthusiastic. The tabulation of results shows a very even ratio of subscriptions received through the several classes of banks in the two loans. In Schedule 10 are stated in tabulated form the subscriptions, classified accordingly to the kind of bank through which they were made. The record made by the different geographic subdivisions of the district is given in Schedule 11. It should be understood in con sidering the figures for the city of New York, that many persons living in other parts of New York have subscribed in Manhattan and have paid for their subscriptions with funds drawn from Manhattan banks; hence the low apparent per capita subscriptions in certain of the other boroughs. Further, the per capita for Man hattan is materially increased because of the immense corporation subscriptions placed with Manhattan banks. FIXED ORGANIZATION ESTABLISHED. The progression of the Liberty loans forced this bank to modify radically its plan of administration. In the first loan, so rapid were the steps from the announcement to the close of the sale that the Federal Reserve Bank of New York depended almost exclusively upon volunteers whom bond houses, banks, and corporations could spare for the emergency. This plan of organization applied not only to the selling force but to that division of the bank which received subscriptions and made deliveries of bonds. It became apparent very soon that a closer organization was necessary, and the bond-issue division was created accordingly, with its staff of fixed employees. During the second Liberty loan the principal responsibility for selling bonds in this district again rested upon volunteers, who served with unabated industry during the period of the campaign and for some time before it. But with the mapping out of plans for the third loan, it was seen that there was little or no interval between the close of one loan and the preparation for the next. Condi tions were changing. In the earlier loans the patriotism of the country carried the campaign through successfully. But with the diminution of surpluses and the necessity of striking deeper, of enlisting the support of every American, a more intensive cam paign was requisite, and for it a more closely knit organization. A fixed establishment of paid employees was therefore built up, which enlarges and contracts as the demands of the campaign prescribe. At the close of 1918 the paid personnel of the Liberty loan organiza tion in this district numbered 1,210 persons, including the employees Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

352 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. in the fiscal-agency departments of the bank working on the Liberty loan and certificates of indebtedness activities. A great many volunteers nevertheless remain, but save for a few executives permanently associated with the central organization, they are engaged in the work of the loan only during the campaign and the period just before it. Among them are not only those who act as chief advisers in framing and carrying out the policies of the campaign but a great number of chairmen and members of Liberty loan committees, who have the hard task of carrying to a successful finish the loan campaigns in the local communities. In the early loans local committees assumed many of the expenses of their work, but because of the succession of campaigns and the recognition of Liberty loan activities as a continuous operation of the Government, these expenses have become more and more a charge upon the Treasury. Further, because of the very fact that Liberty loan campaigns by their repetition have ceased to be novelties, it has been necessary to carry on at once a more extensive and a more intensive canvass. The results have been apparent in the vastly increased volume of individual subscriptions and also in the amount of bonds sold. But the expenses, especially as between the second and third loans, have increased materially. To administer the disbursement of funds in more systematic fashion, the comptroller's department early in 1918 became a part of the continuing organization. It purchases all equipment and supplies, pays all salaries, reimburses local committees for their expenses, maintains all accounts and is the custodian for the com mittee's property. Its disbursements in 1918, including the costs of the fiscal agency divisions of the bank, amounted to about $4,250,000, all of which it paid with Federal Reserve Bank funds. These expenditures in turn are revouchered to the Treasury Depart ment, by which the bank is repaid. A closely segregated budget for the regular organization and separate budgets for the campaign activi ties have been framed. Through a system of weekly reports of lia bilities registered the comptroller is advised at all times whether the various branches of the organization are living within their appropriations. The Federal Reserve Bank of New York wishes here to record and acknowledge the services rendered to the Government by all those who labored for the success of Government financing in its fixed and its volunteer organizations. Regardless of their own con venience, interests and health, they worked for the successful per formance of whatever tasks were assigned to them with the utmost devotion and patriotism. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 2—NEW YORK. 353 THE CENTRAL LIBERTY LOAN COMMITTEE. The central Liberty loan committee in this district is the dynamic center of the whole organization. It was established at the opening of the first Liberty loan campaign, was enlarged prior to the second, and is now composed of 15 bankers, with the governor of the Federal Reserve Bank of New York as chairman. Its membership includes the responsible heads of many of the largest banks and banking houses in New York. The committee meets frequently during the progress of the loans and at such other times as business of importance develops. It is far more than an advisory committee; it is the body which determines the policies to be followed in selling the loan, the nature of the appeal to be made to the buyers, and the financial measures of an extraordinary nature to be taken for insuring the success of the loan. The attitude of these bankers has at all times been of the most patriotic nature and their services have been of inestimable value to the success of the Government's financial programme. THE SALES ORGANIZATION. Immediately in charge of sales is the distribution organization, of which a member of the central Liberty loan committee has been chairman. Its members are bankers or partners in bond houses. Eight of their number act as chairmen, respectively, of the eight subdistricts into which the Second Federal Reserve District (with the exception of three boroughs of the City of New York) is divided. Working at headquarters is the permanent staff of the distribution committee, at the head of which is the director of distribution, whose function is that of a responsible executive in charge of an immense and very active bond-selling organization. The headquarters' business of the distribution committee is handled by a staff which numbers 99 persons, including the executive secretaries who act as assistants to the subdistrict chairmen. ORGANIZATION OUTSIDE METROPOLITAN DISTRICT. The subdistrict chairmen establish the connection between the central organization and the local Liberty loan committees. Each is the adviser of the local chairmen within his subdistrict, and is responsible for the success of the loan within its limits. He transmits and adapts to the requirement of local communities the plans pre pared at headquarters, and sees that the local committees make full use of material prepared there, in so far as it is fitted to local requirements. The local committees develop ideas and plans of their own with the greatest ingenuity, making their campaigns per sonal and direct to their own citizens. 100823°—19 23 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

354 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. The highly creditable showing made in the subdistricts is directly attributable to the energy and capacity of the chairmen of the local committees, who have served with a high sense of patriotism, en tirely forgetting their personal affairs during the loan campaigns and devoting themselves to their success. In the small towns the local chairman has worked with limited resources, but has covered his territory personally and with his committee, soliciting subscriptions and arousing people to a full sense of their obligation. In the larger towns the methods have been similar to those employed in the metropolitan district. Many of the chairmen responsible for large or populous areas have made card indexes of all possible subscribers, working out in detail the plan of assigning quotas to component communities. Subscriptions have been sought, however, on a purely voluntary basis. In the third loan campaign there were 1,425 local men's com mittees, each with its chairman and members drawn from the leading citizens of the neighborhood, numbering in all 21,200. The number of men's committees in the fourth loan rose to 2,075, with a total membership of 30,800, to which should be added a vast army of volunteers composed of associate members, members of allied organ izations, canvassers, speakers and workers, all serving with the single purpose of achieving this district's share of the Liberty loan. ORGANIZATION IN METROPOLITAN DISTRICT. Only two of the five boroughs of the city of New York were included in. the subdistrict organization. These were Queens and Richmond, which were regarded as parts of the Long Island subdistrict. The other three boroughs, Manhattan, Brooklyn, and 'The Bronx, because of their immense population and special character, were treated separately as constituting the Metropolitan District. Brooklyn and The Bronx each had its own borough organization. Manhattan was covered by many organizations, some of which inevitably overlapped, and was in many ways the center for the whole campaign in the Second Federal Reserve District. The organizations which concentrated on the Borough of Man hattan were not for the most part limited by geographic lines, but Manhattan was the chief field of activity. These organizations included an advisory trades committee, which alone accounted for half of the subscriptions secured in the Second Federal Reserve District; a metropolitan canvass committee, composed of 90,000 workers, which devoted itself to the house-to-house and man-to man campaign; the commercial banks and trust companies commit tee, which was organized for the first time shortly before the third loan for the purpose of coordinating the Liberty loan work of the financial institutions of the city; the municipal employees committee, Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT im 2 2STEW YOBK. 355 which canvassed the 100,000 employees of the city of New York; the insurance committee; the New York Stock Exchange committee; the Consolidated Stock Exchange committee; the public utilities commit tee; the New York Cotton Exchange committee, and the religious organizations committee, Of these, the two largest in point of mem bership were the advisory trades committee and the Metropolitan canvass committee. The advisory trades committee.—This committee, composed of 11 executive members, each of whom in turn was responsible for the campaign among five to twelve groups of trades, aimed to secure corporation and firm subscriptions, and the subscriptions of employes. In the fourth loan every effort was made to have the employees of large concerns control their own Liberty loan committees, thereby removing the element of employer's compulsion in securing sub scriptions. The quota assigned to the advisory trades committee in the third loan was arbitrarily fixed at half the total quota for the Second Federal Reserve District. A week before the end of the campaign the committee passed its second loan total, and on the day before the close exceeded its quota. Over 5>000 industrial honor flags were awarded to individual firms or plants where 60 per cent or more of the employees subscribed. In the fourth loan a com plete card index of all industrial concerns was prepared, forming a list of prospects which was allotted among 85 subcommittees1, having an aggregate membership of 3,485 and an organization of 18,000 volunteer workers, which canvassed approximately 125,000 con cerns in the greater city. The quota, fixed at 90 per cent above the quota assigned for the third loan, was greatly exceeded. The com mittee's record was: Amount of Quota. subscriptions. Third loan $-150,000,000 $564,767,950 805,205,000 1,083,861,000 The metropolitan canvass committee.—This committee undertook the house-to-house canvass in the Boroughs of Manhattan, Brooklyn, and The Bronx. It was organized according to the precincts of the municipal police department, with a borough chairman, and a cap tain and lieutenants in each precinct. Aside from the intensive work within the precincts it carried on a campaign through the public schools, held innumerable street meetings, many large mass meetings in public halls and armories, and supervised a flying squad ron of "traveling banks" which took subscriptions in many parts of the city. In the fourth loan it augmented its plan of organization by making use of the extraordinary ability of the police and fire depart- Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

356 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. ments to sell bonds. The total number of subscriptions received through the committee was: Number of Amount of subscribers. subscriptions. Third loan 1,099,367 $145,475,500 1,296,511 378,480,050 WOMAN S COMMITTEE. This committee was developed from the comparatively haphazard association of workers in the first Liberty loan to a closely knit well-administered organization in the fourth Liberty loan. The activity of women in support of the Liberty loan has been one of the particular features of the campaigns in this district. They have shown an increasing desire to work for the loans and in many cases have regarded it as a privilege. In preparation for the third loan campaign 1,310 local committees were organized in 70 counties, with about 18,500 volunteer workers— a threefold increase from the second loan. The returns indicate that the woman's committee procured at least $110,000,000 of sub scriptions. This figure is probably considerably less than the actual total secured, because in many cases the results were merged with reports of the men's local committees. In the fourth loan campaign they were still more intensively organized, with commensurate results. There were 1,861 local com mittees in 72 counties, and about 35,000 workers. The subscriptions secured amounted to $203,383,850, almost all in small amounts. More than 562,000 individual subscriptions were in amounts of less than $500. In other words, the woman's organization was responsible for 16 per cent of the number of subscriptions, and 10 per cent of the amount of bonds sold in this district. PARTIAL PAYMENTS. From the first of the Liberty loans there was a very general demand throughout the country for installment purchases on an easier basis than that provided in the Government plan. Various expedients were resorted to. In many cases employers carried the bonds for their employees. In others, banks agreed to carry bonds for sub scribers in their neighborhoods on the basis of weekly or monthly payments. A duplicate card system, enabling banks by a single punch to record payments made by subscribers, was made available for free distribution to the banks generally in this district, besides which a number of banks developed their own plans. In the first campaign, in so far as figures are available, the number of partial Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 2 NEW YORK. 357 payment subscribers was comparatively small. But as greater efforts were made in the second campaign, a large number of small sub scribers was secured, the estimated number for Greater New York being 318,000, with an aggregate subscription of $29,500,000. The result, from the standpoint of both banks and subscribers, was far from satisfactory. Subscribers found that paying week after week at the same bank during the usual banking hours cost them time and carfare equal perhaps to the value of the bonds which they were purchasing. Further, banks and branches of banks in outlying districts and in centers of dense population carried by far the greatest part of the burden, while the large banks in the financial district whose resources and staff were best able to take care of the work had comparatively little to do. With the approach of the third loan, the Liberty loan organization had to choose between discontinuing partial payments in the Metro politan district or providing a mechanism whereby the operation could be handled under the supervision of the Federal Reserve Bank. The latter alternative was taken and, with the approval of the Treasury Department, the Liberty Loan Association of banks and trust companies of New York City was formed. This was a syndi cate of 130 banks, which agreed to subscribe for and carry a total of not over $ 100,000,000 in bonds for the benefit of small subscribers. Coupon books were sold at $2 each for $50 bonds and$4eachfor$100 bonds with the understanding that payments should be made once a week for 48 weeks. The subscriber presented his book at any one of the 680 banks or payment stations throughout the greater city, which received the payment, stamped a coupon, detached it, and sent it to the adminis tration office of the Liberty loan association where the payment was recorded, and through which, wThen the payments had been com pleted, the bond was delivered. This undertaking involved the handling of more than 800,000 active accounts, some of which are constantly being closed out with adjustments of interest and the return of the principal, and many of which are delinquent and require a notification and adjustment. The staff required to handle this operation is at present 317 persons. When the books were first opened wTork went on in two shifts through most of the 24 hours of the day. In the fourth loan, the plan was again adopted, but with important administrative changes reducing materially the cost of the operation. Instead of the detachable coupon, the subscriber purchases gummed receipts which are placed in the books as a record of payments. The plan also provided for a follow-up method of reaching delinquent subscribers. The cost of administration has been materially less and the number of employees required to handle it is about 130. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

358 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. The smaller number of subscriptions received in the fourth loan plan is undoubtedly accounted for because the initial payment was 8 per cent., and because payments were to be completed in 23 instead of 48 weeks. The comparison is as follows: Third loan. Fourth loan. Total. Books sold 836,363 786,000 1,022,363 Value of bonds $46,700,000 $44,109,000 $90,800,000 The two plans require the handling of upward of 1,600,000 current accounts. The number of persons calling at the office of the asso ciation to pay up in full and receive their bonds or to make inquiry about their subscriptions has reached in a single day as high as 15,000. PUBLICITY. Hand in hand with the sales organization, and as an essential accompaniment to its purpose of selling bonds is the publicity organ ization. But the publicity department has had before it a purpose not limited to the sale of the Liberty loan, nor even limited to the immensely greater object of producing in the minds of the American people a desire to save and to invest. Liberty loan publicity has consistently worked to spread the ideas America had in entering the war and to declare the need for attaining a decisive victory. In every newspaper and magazine, on every billboard, on every fence, on almost every lamppost, vehicle, and flagstaff, and in almost every store and householder's window the message of the Liberty loan and of America has been carried. The publicity of the firsthand second loans laid the groundwork of a genuinely American appeal, showing the necessity for winning the war and the obligation of every American to participate in its high purposes. With the opening of the third loan our active part in the armed conflict had begun. The German spring campaign was in its full flood, and everywhere was a lurking fear as to how far it might go. The note of danger, of the very serious menace confronting the free nations of the world, together with the determination of the United States to see it through, was the burden of the printed and spoken word carried in the publicity material. The events in France furnished the visible support to all that was said and written, and the selective service act had brought the fact of war to every neighborhood in a most concrete way. These things, dwelt upon in pamphlet, poster, and public speech, were reflected in the immensely increased volume of popular subscriptions. When the early preparations were under way for the fourth loan it seemed likely that similar conditions would prevail and that the ideas behind fourth loan publicity should be to the same effect as Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT $T0. 2—NEW YORK. 359 before. The designs for posters selected in Washington in June for the whole country depicted war in its grimmest aspects, and even went to the point of warning America against German invasion of our own shores. Some of the advertising and pamphlets prepared in that early time reflected the same thought. But by the time the cam paign had arrived the face of the war had completely changed— to a degree far greater than the most optimistic in June had dared to hope. Added to the tendency toward relaxation of concrete efforts which victories on all fronts induced was the German peace pro posal, launched in the midst of the loan campaign. The complete shift in conditions forced a corresponding change of methods in the very heat of the campaign. This district threw out a last-minute appeal to "Double the third," the effect of which was to put the campaign in competition with its forerunner, and on a domestic basis. Special acknowledgment should be made of the invaluable services rendered to this district by the publicity bureau of the Treasury Department. PUBLICITY ORGANIZATION AND RESULTS. The publicity department in this district carries1 on its work along five lines, each administered by a separate bureau—press bureau, feature bureau, advertising bureau, the bureau of speakers and meetings, and the foreign language bureau. The press bureau is established on the plan of a modern news paper office with editors, editorial writers, writers of special articles, and reporters. Prior to the campaign it supplies articles of a general nature to magazines throughout the United States and prepares special material for production in Sunday newspapers during the period of the campaign. Included in this material are cartoons, editorials, poems, articles for trade, technical, and financial maga zines, farm periodicals, theater programs, and labor magazines. During the campaign it gives daily news, not only of the results of sales, but of the numerous activities carried on by various Liberty loan organizations throughout the city and district, including a very considerable amount of plate matter sent out to weekly newspapers. All told, during the third loan the press bureau records show that 26,850 columns of matter was printed in the form furnished; in the fourth loan the total rose by 7,000 columns. The total number of Liberty loan articles printed in the district increased from 111,207 to 141,443, with a total of 59,932 columns. The feature bureau, which has the work of preparing and producing special Liberty loan features of a publicity nature, undertook the direction of all parades, indoor "and outdoor exhibits, the production of moving pictures, and the supply of flags, banners, badges, and nov elties. In the third loan it had as the principal feature of its New Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

360 ANNUAL REPORT OF THE FEDERAL- RESERVE BOARD. York City campaign, " Liberty land/' a war exhibit in the Sixty-ninth Regiment Armory, where the first veterans to return to this country from Gen. Pershing's forces and a detachment of French chasseurs, the "Blue Devils," were presented in a dramatic way to audiences aggregating 250,000 in 19 days. In the fourth loan it made the "Liberty altar" at Madison Square the center of Liberty loan activi ties. It was at the foot of "The Avenue of the Allies" into which Fifth Avenue was transformed. This great center for Liberty loan pageantry was an expression of the idea of unity among the free nations of the world. Members of the French Foreign Legion, the Italian Bersaglieri, the Alpini, the French Army Band, and the Italian Grenadier Band participated in the campaign under the direction of the bureau. Certain of them appeared in the Liberty day parade led by President Wilson, in which 35,000 persons marched. Others served throughout the district, singly and on special trains. The advertising bureau, the largest branch of the publicity organi zation, prepared all newspaper advertising put out from headquarters, secured advertising space, and developed advertising printed matter in great variety, which it distributed through the district. The value of the advertising space obtained through the generosity of mer chants, bankers, manufacturers, and private contributors for the third loan between January 1 and June 1 was estimated at $1,750,000 *, in the fourth loan at more than $2,000,000. For the third loan the bureau distributed nearly 85,000,000 pieces of printed matter, of which 47,000,000 were published in this district; in the fourth loan 96,000,000 pieces were distributed. In the fourth loan the services of many artists known throughout the country were used in the pro duction of special canvasses for window display and for billboard re production. In response to requests made to the speakers' bureau, many mem bers of the diplomatic corps and officers of the Federal and State governments, as well as many hundred men and women of prominence, spoke at Liberty loan meetings throughout the district. The chief of these was held at the Metropolitan Opera House in New York City just prior to the opening of the fourth loan campaign, when President Wilson made his last public address before Germany entered upon the discussion of peace. The work of the foreign language bureau, coordinated with the other bureaus of the publicity department and with the distribution committee, carried the work of the Liberty loan among the foreignborn residents of the district. The increase of their interest is shown by the fact that in the second loan about 25 per cent of the foreign-born residents subscribed to Liberty bonds, in the third 55 per cent, and in the fourth 80 per cent. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 2—NEW YORK, 361 The publicity department, in addition to many volunteers, had a personnel of 664 paid employees in the fourth loan campaign, includ ing 201 persons in its fixed organization. RECEIPTS, DELIVERIES, EXCHANGES, AND CONVERSIONS. An index to the size of the Second Federal Reserve District's par ticipation in the Liberty loans appears in the record of transactions of the bond issue division of the Federal Reserve Bank; but to com prehend their volume it is necessary to imagine a corporation with over 3,000,000 bondholders, with bonds in many denominations, of seven different issues, and distributed among holders unaccustomed to financial practices. As a matter of fact the bond issue division, which handles this vast volume of business, deals also with bonds sold in other districts which find their way to New York for exchange or conversion. Through the ability of the Treasury Department to supply definitive bonds early in each of the two campaigns of 1918, it has been possible for the bond issue division to give far more prompt service than during 1917. In the case of bonds sold for cash during the campaign deliv eries have been made immediately. In the third Liberty loan the number of pieces so delivered was 999,378. This figure rose to 1,352,586 in the fourth Liberty loan. At the close of business Mon day, November 4, the day on which payments and deliveries should be made on coupon bonds of the fourth loan paid for in full, a total of certificates of indebtedness, credits, and cash had been received against subscriptions amounting to $1,484,329,895. On that day also 2,560,473 pieces were available for delivery by banks throughout the district and out-of-town banks were able, because of prior receipts of bonds, to make deliveries to subscribers on exactly the same footing as banks in New York City. The following table shows the comparative transactions in the third and fourth loans, the transactions in the latter running only to December 31: Third Liberty loan Fourth Liberty loan. Cash sales during campaign $144,276,250.00 $224,640,050.00 Total receipts, including cash sales: Principal 1,115,243,650.00 1,854,038,500.00 Accrued interest 2,048,165.46 920,626.41 Method of payment: Certificates of indebtedness 187,223,000.00 712,758,500.00 Advice of credit 797,301,916.55 999,295,804.89 Cash 132,766,898.91 142,904,821.52 Bonds full-paid with: First installment date 796,8S6,900.00 1,422,001,550.00 Second installment date 58,266,650. 00 151,405,500.00 Third installment date 78,823,300.00 91,112,400.00 Fourth installment date 181,266,800.00 Bond deliveries: Coupon bonds 1,019,020,350.00 1,517,611,800.00 Registered bonds 66,223,300.00 5,201,150.00 Number of pieces delivered: Coupon bonds 4,149,163 4,145,150 Registered bonds 71,014 8,721 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

362 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. Throughout the year exchanges were freely made from one denomi nation to another of the same issue, immediate deliveries being made in every case. The exchanges indicate that a large number of small denomination bonds which have been sold by subscribe rs are m constant process of exchange into bonds of $1,000 denomination. The total volume exchanged during 1918 was in excess of $1,100,000,000. The number of pieces handled was: Received, 4,103,229 pieces; delivered, 1,637,490 pieces. The conversion privilege attaching to the two earlier issues has also resulted in large deliveries of new bonds. The bank made every effort by repeated transmission of circulars to the banks of the dis trict and by advertising in the newspapers to induce holders of the earlier issues to convert within the time prescribed by the Secretary of the Treasury, which terminated on November 9, 1918. The following is a statement of the conversions to December 31, a small number of items still remaining unadjusted: Converted from one interest rate to another: First 3J per cent bonds to 4 per cent (Nov. 8, 1917-May 15,1918). $113, 385, 650 Number of deliveries, pieces 737, 852 First 3i per cent bonds to 41 per cent $1,806,600 First 4 per cent bond3 to 4| per cent $74,117,750 Number of deliveries, including deliveries made on converting first 3§ per cent to 4 J per cent, pieces 262,173 Second 4 per cent bonds to 4} per cent $1,045,931,500 Number of deliveries, pieces 1, 596, 990 Aggregate number of pieces bandied, incoming and outgoing 4, 098, 205 Special provision was made for converting bonds without delay for owners who called in person. The largest number of such applica tions received in any one day was 2,161. In the last eleven days of the conversion period approximately 25 per cent of the total number of conversions handled in this way were made. GOVERNMENT DEPOSITS. The depositing of the proceeds of sales of Liberty loans and cer tificates of indebtedness was undertaken in accordance with law at the request of the Secretary of the Treasury. Depositaries were appointed by the Federal Reserve Bank, which had the responsibility of receiving and approving collateral, depositing and withdrawing funds and collecting interest on deposits, all under the instruction and supervision of the Treasury Department. The duly qualified depositary banks were permitted under the law to pay for certificates of indebtedness and Liberty bonds by opening book credits in favor of the Treasury. Because a large proportion of the deposits were created in this way possible disturbances to the money market were reduced to a minimum. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT lsT0. 2—INEW YORK. 363 The withdrawal of deposits from, depositary hanks, created by the opening of credits resulting from the sale of Liberty bonds or cer tificates of indebtedness, has been uniformly made on instructions from the Treasury Department on a pro rata basis which has been the same for all banks in the district, and a notice of 48 hours has been given whenever possible. In order to assist in stabilizing the money market, funds transferred by the Treasury Department from other Federal Reserve Banks to the Federal Reserve Bank of New York in excess of the amounts needed for immediate disbursement have on several occasions been redeposited at interest with qualified depositaries in New York City, subject to withdrawal without notice, and as far as possible have been placed in banks to which disburse ments for account of loans to foreign Governments were likely soon to be made. In order to minimize disturbances due to the withdrawal of funds representing payments of income and excess profit taxes during June, 1918, arrangements were made whereby the seven collectors of internal revenue in the district deposited their receipts of cash, checks, and certificates of indebtedness with this bank and all checks on banks which had been designated United States depositaries were forwarded to such banks for credit in the "war loan deposit account" of the Government, subject to withdrawal gradually in accordance with the Government's requirements. The number of such checks received was about 300,000, aggregating about $600,000,000. During the first loan 306 banks qualified as depositaries; in the second 533, in the third 801, and in the fourth 867. In order to facilitate the pledging of collateral, local custodians were appointed in 49 cities, but the number was later reduced to 36. The Government deposit division of the Federal Reserve Bank, with a personnel of 63 employees, administered this function. The following shows the magnitude of the deposits and the volume of securities pledged against them: LIBERTY .LOAN FUNDS, Third loan, largest amount on deposit, May 14. $517, 537, 883. 00 Fourth loan, largest amount on deposit, Nov. 4 609, 182, 509. 63 CERTIFICATES OF INDEBTEDNESS FUNDS. Third loan, largest amount on deposit, Apr. 4. 370, 500, 000. 00 Fourth loan, largest amount on deposit, July 10....... 496, 300, 000. 00 SECURITIES IN' VAl.'LT. Third loan, largest amount, May 21.. 754, 230,106. 65 Fourth loan, largest amount, Oct. 26 754,633,510.49 SECURITIES AVITH CUSTODIANS. Third loan, largest amount, June 18 : 379, 241, 241. 88 Fourth loan, largest amount, Oct. 26. 309, 849, 331. 41 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

364 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. GOVERNMENT DISBURSEMENTS. Prior to America's entry into the war the only function under taken by the Federal Reserve Bank as fiscal agent for the Treasury Department was the payment of Government checks. With the coming of war this work has increased manyfold. Checks are of all sorts and sizes, varying from checks of less than $1 for interest on $50 registered bonds to Treasury drafts for large sums on war contracts. The growing volume of work handled in this department has neces sitated the employment of an increasing number of clerks. The following table shows the number of checks handled each month, their amount and the average number of employees: Number of Average h c a h n e d c l l< ed s . Amount. n o u f m e b m e r ployees. January... 513,383 $217, 659,000 15 February.. 583,719 209, 917,000 15 March 689,958 298, 885,000 20 April 729,716 356, 249,000 20 May 901,319 377, 466,000 20 June 975,381 389, 225,000 25 July 023,146 425. 430,000 25 August 063,603 561, 663,000 30 September. 066,270 413, 990,000 30 October... 128,706 515, 999,000 35 November. 101,626 553, 637,000 40 December. 331,154 616, 472,000 40 Total 4,936,592,000 The record day was December 26, when 102,175 checks were handled. The payments of the Treasury through this bank, since April 1, 1917, exclusive of maturing certificates and coupons, have included $7,400,000,000 of advances to foreign governments and $5,900,000,000 in miscellaneous Treasury checks, aggregating $13,300,000,000 in all, or about one-half of the entire Treasury payments, exclusive of cer tificates and coupons, during the 21 months. EXPENSES OF LOANS. The cost of conducting the two campaigns of 1918, of maintaining the regular sales and publicity organizations of the Liberty loan, and of carrying on the fiscal agency operations of the Federal Reserve Bank, in so far as they relate to the third and fourth Liberty loans, amounted on December 31 to $4,244,822.12. The detailed figures, as reported by the comptroller of the Liberty loan organization, are shown in Schedule 12. The cost of operating the two partial pay ment plans are included in the figures for the distribution organiza tion, and amount to date for the third and fourth loans, respectively, to $460,076.18 and $205,817.21. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 2—NEW YORK. 365 NEW GOVERNMENT LOAN ORGANIZATION. At the close of the year, following instructions from the Secretary of the Treasury, arrangements were made to consolidate the work of the Liberty loan committee and the war savings organizations within the district under the control of the governor of the Federal Reserve Bank of New York as a unified Government loan organization. The War savings staff has been incorporated with the headquarters departments of the Liberty loan committee with a prospect of material reduction in administration costs, and with the expectation of coordinating the activities of the two committees more closely together than heretofore. The consolidated organization will have as its head a director of Government loan organization for the district with several vice directors. The operations of the new organization begin on January 1, 1919. WAR SAVINGS AND THRIFT STAMPS. From December 7, 1917, to December 31, 1918, the Federal Re serve Bank of New York sold war savings and thrift stamps as follows: War savings Thrift, stamps stamps (pieces). (pieces). Greater New York 2,043,486 10,992,771 New York State 929,208 2,682,448 New Jersey 335,305 2,570,566 Connecticut 11,394 31,734 Philippine Islands 5,000 Haiti 12 200 Total 3,324,405 16,277,719 STABILIZATION OF THE MONEY MARKET. Before the close of the first Liberty loan campaign, in May, 1917, it became apparent to the officers of the Federal Reserve Bank and to the members of the Liberty loan committee that steps must be taken to stabilize interest rates in the stock exchange loan market in order that rates on such loans might not reach such levels as to embarrass the Treasury. The natural result of the increasing volume of Gov ernment borrowing from New York City and interior banks was the calling of loans secured by stock exchange collateral, a tendency which was increased by the desire of the banks of the country to accumulate larger amounts of paper available for discount at the Federal Reserve Bank. For some months the institutions represented on the Liberty loan committee undertook from day to day to find the large amounts of money required to be loaned on the exchange in order to avoid dis turbed conditions. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

366 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD, By September, 1917, however, the amount had became too large for these institutions to assume without injustice to themselves and to their customers, and a subcommittee of the Liberty loan com mittee was appointed, with the governor of the Federal Reserve Bank as chairman, for the purpose of effecting a more equitable distribution of the loans and devising plans for providing the funds required for the needs of the stock exchange. Under the general supervision of the Federal Reserve Bank this so-called "money committee" perfected an organization of 63 of the banks and trust companies in New York City which agreeed to place at the committee's disposal a fund to be used when necessary in making loans on stock exchange collateral, the participation of each institution being determined according to its assets, Tills arrangement, undertaken at first in consultation with the Secretary of the Treasury; has been renewed from time to time at his request. As experience was obtained changes were effected in the plan of participation, and an arrangement was finally reached which reap portioned among the participating banks, on the basis of their assets, the aggregate volume of stock exchange call loans which they were then carrying in the aggregate and provided for an additional loaning fund of $200,000,000 to be used when necessary. In October owing to military and political developments it became evident that a large speculation in securities was developing, notwith standing the fact that the fourth Liberty loan was in course of being placed and the Government requirements for credit were at a maxi mum. Under these circumstances the committee felt it necessary to adopt some positive measures of restriction and arranged with the banks participating in the fund to increase the margins required for stock exchange loans from the customary minimum of 20 per cent to a minimum of 30 per cent. At the same time, by arrangement with the officers and a committee of the stock exchange, to which all members of the exchange were reporting the total amount of their borrowings, such reports were made available to the money commit tee. During this period the demands upon the additional loaning fund were very heavy, due primarily to the calling of loans by outof-town institutions and by local lenders not in the group of partici pant banks. Upon the representation of the committee of the stock exchange that the continued enforcement of the requirements for additional margin might work hardship and in some cases even injustice, the arrangement was withdrawn on December 5 upon the assurance of the committee that the exchange would take steps to prevent any con siderable increase in the total of the loan account of its members. The activities of the money committee were undertaken solely to insure the Government against developments in the money market Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT :NT0. 2—NEW YORK. 367 in New York which would in any way militate against the success of its borrowing program. Its aims may be summarized as follows: First. To maintain a free market for securities and thereby protect the investment situation and the integrity of a great volume of bank loans made upon stock-exchange collateral. Second. To prevent high rates and wide fluctuations in the money market. Third. To prevent an increase in the total amount of credit em ployed in stock-exchange transactions. The records indicate that the work was successfully done after the formation of the committee. The rates for call loans on stockexchange collateral, set forth in full on page 376, have ranged prin cipally between 4 per cent and 6 per cent, never exceeding the latter figure; a free market for securities has been maintained and the amount of stock-exchange loans has been held, within reasonable bounds. It seems clear that if some agency of this character had not been functioning the Government's financial plans might have been seriously embarrassed. The New York banking institutions participating in the arrangement, as well as the officers and members of the stock exchange, have at all times accorded the money com mittee their support and evidenced their readiness to cooperate in rendering this important assistance to Government finance; while the members of the money committee undertook a difficult and responsible piece of work in a most public-spirited manner, and in carrying it out gave generously of their time and consideration. CAPITAL ISSUES COMMITTEE. On January 11, 1918, the Secretary of the Treasury requested the Federal Keserve Board, "pending action by Congress/' to pass upon capital expenditures and issues of new securities from the standpoint of their necessity as compared with the Government's large needs of capital, labor, material, and transportation facilities. The Board accordingly appointed from its membership a Capital Issues Com mittee, which secured the assistance of an advisory committee of bankers and caused subcommittees to be organized in each of the Federal Keserve districts. In the War Finance Corporation Act, approved April 5, 1918, Congress sanctioned by law the continuance of the work of the committee, and pursuant to that act the President appointed a permanent Capital Issues Committee, which in turn appointed per manent district committees in each of the Federal Keserve districts. The district committee for the Second Federal Reserve District, of which, as in other districts, the chairman of the Federal Reserve Bank was chairman and the governor vice chairman, consisted of 30 bankers, manufacturers, officers of public utilities, and others, Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

368 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD, It held regular meetings, usually twice and sometimes three times weekly, usually lasting from three to five hours and attended by five or more members, in rotation, from the date of its organization until December 31, 1918, when by vote of the central committee, and with the concurrence of the Secretary of the Treasury, the active work of the committee was discontinued. Nine hundred and seventy-two applications, totaling $2,069,613,- 048.66, have been formally considered by the district committee, and in the majority of cases hearings were granted to applicants. With respect to 181 of these applications the district committee took final jurisdiction. Detailed reports were rendered to the Capital Issues Committee at Washington with respect to 791 appli cations, aggregating $1,875,123,043.80. Out of this total the dis trict committee recommended approval of applications aggregating $1,775,343,629.80, and recommended disapproval of $99,779,414. The action of the central committee with respect to these applica tions was as follows: It approved $1,722,404,611.50 and disapproved $119,368,795.25, and on or about December 31, 1918, when the com mittee discontinued its operations, it dismissed applications still pending aggregating $33,349,637.05. The various matters considered by the district committee have covered every variety of security issue, including issues by States, counties, and municipalities, by public utility companies, by indus trial corporations, by banks, insurance and trust companies, by syndicates and membership associations. Inasmuch as the funda mental purpose of the committee was to conserve capital, labor, materials, and transportation facilities for purposes contributing directly to the prosecution of the war, the district committee asked for and obtained from practically all public and private organiza tions within the Second Federal Reserve District statements of their construction programs prior to the letting of contracts for such programs. By this means much construction work which would ultimately have led to the issuance of securities was deferred, labor and materials have been released for war purposes, and the investment market has been relieved of the necessity of absorbing large amounts of securities. This committee has also obtained reports on private construc tion as well as on public construction to be paid for by taxation or assessment, as distinguished from the sale of securities. In this connection the district committee reviewed the tax budgets of all municipalities in the Federal Reserve District which had been pre pared prior to the signing of the armistice. It also followed up all advertised construction of churches, clubs, private residences, etc., prior to the date when machinery was instituted by the War Indus tries Board requiring the licensing of all nonwar construction costing Digitized fomr oFRreA SthERan $2,500. http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT HO. 2—NEW YORK. 369 The committee's usefulness should not be measured only by the applications formally presented to it and approved or disapproved by it, since the mere fact of the committee's existence in itself con stituted a strong restraint upon the issuance of new securities, and few, if any, applications were presented to the committee except by those who believed that their applications would be approved. The members of the committee gave most generously of their time and enjoyed the heartiest cooperation from public and private officials, from bankers, investment houses, lawyers, manufacturers, and merchants, as well as from the Investment Bankers' Association, the American Bankers' Association, the New York Stock Exchange, and the New York Curb Market Association. Without the coopera tion of these individuals and associations the work of the committee would have been almost impossible. FINANCIAL CONDITIONS, BANKING IN THE SECOND FEDERAL RESERVE DISTRICT. The chart on the following page shows certain significant figures from the weekly reports of 107 banks in this district, being all the member banks in New York City, Brooklyn, Buffalo, Rochester, Newark, Albany, and Syracuse, N. Y.; Jersey City, N. J.; and Bridge port, Conn. This chart probably gives the best picture obtainable of banking conditions in this district throughout the year. With the exception of January and February when the reports did not distin guish between Government bonds and certificates of indebtedness, the chart shows, week by week, the volume of (a) United States bonds owned, (&) certificates of indebtedness owned; (c) loans secured by United States obligations; (d) all other loans and deposits. The dotted line (e) indicates the volume of Government deposits in the reporting banks throughout the year. It will be noted that the volume of " other loans and investments " was almost exactly the same at the beginning of the year as at the end; namely, $4,100,000,000. In fact the volume actually decreased somewhat, as 11 institutions with resources of about $350,000,000 were added to the list of reporting banks during the year. The expansion is entirely in Government securities and loans thereon. The Government bonds owned rose substantially at the close of both the third and fourth loan campaigns, with a tendency to de crease slightly thereafter. The certificates of indebtedness show the usual increases before bond sales and decreases thereafter; the volume of loans on Liberty bonds was fairly steady up to the close of the fourth loan campaign, when it increased sharply, indicating clearly the heavy borrowing which had to be resorted to in order to subscribe the quota assigned to this Federal reserve district. 100823°—19 24 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

370 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. CLASSIFICATION OF LOANS AND INVESTMENTS" REmTWG MEMBER BANKS, SECOND FEDERALRESERVE IMSTRKT mj JAN. F£8. M _AF_K _ _M_A_Y JONg TUUV AUG SEPT. OCT. MOV. ""ST „ .. !i2Zl!ji!VLi2!!Z <toool A-UNITED STATES BONDS OWNED ?0o4 B- CtRTifUATES dFtNbEBTEfe^^ OWNtt) C- LOANS SECURED BY UNITED STATES OBLIGATIONS O- ALL OTHER LOANS AND INVESTMENTS E- GOVERNMENT DEPOSITS 7ooo] &0OG! /OQO yoock 3 God HF ^ooot /OOoL JTAN. TE^. MCH. Ai»fc. M^X JtfME. JuU A«a. SEKT. OCT ftov. *&c. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NT0. 2—NEW YORK. 371 In the following chart the two upper lines show the movements of the loans and deposits of New York Clearing House banks, while the lower line shows the course of the loans and investments of the Federal Reserve Bank. The close relationship of the two is quite apparent. Government financing and the resulting expansion of banking figures are so clearly portrayed in these two charts and have so com pletely overshadowed all other banking developments as to make further comment unnecessary. The action of the New York Clearing House, however, in fixing maximum rates of interest on deposits was a step of such importance toward sounder banking that the extension of similar control to other communities in the district is much to be desired. The high interest rates prevailing in many parts of this district are a constant element of danger in our banking situation. Often the banks and trust companies, paying such rates, have felt impelled to invest largely in bonds of high yield. The depreciation in the market value of these securities has been so heavy during the past two years that it is believed that the institutions in which high interest rates prevail may be more ready now than in the past for a reconsideration of this whole subject. It is hoped that some sub stantial progress in this direction may be made during 1919. GENERAL BUSINESS CONDITIONS. During January and February business and industry in this dis trict were hampered seriously by congestion in railroad transporta tion and acute fuel shortage, a condition which was aggravated by extremely severe weather. Conditions improved in March, traffic began to move more freely, production increased, and, until October, industry was at its maximum capacity, with civilian needs more and more subordinated to the requirements of war. A steadily increas ing proportion of manufacturing capacity was utilized for the pro duction of war supplies, and Government supervision over industry was constantly increased, especially through control of raw materials and transportation. Of basic materials, such as iron and copper, only a very small percentage was available for other than war needs. In the textile trade, with almost no wool available for manufacture for civilian use, approximately 50 per cent of knit goods, 75 per cent of denim, and 100 per cent of cotton duck were being applied to war purposes. In every line, similar developments occurred to a greater or lesser extent. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

372 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. "+* //yV£srM£/vrs ^ 3£/&s/rs o^ +** IOAA/S MET VWS'TS) Of A/.YCL£/)ft//VG MCUS£ #/)/YKS % £Af?N/NG ASSETS Or >.A JBAA/H M?W y*A>/c J7>N Fee MAR Afif MAy TVtff &*. /*"$ SfPT Ot7~ tfof 2>£c pcoo * r v •» v v ir y y v W?&) YhSbo Wso moo J>£Pos/T$ (met. qorr* a>sf>cs/rs) P?SiD \I000\ YjSo \Jdo £/9/?/y/#§ Asters - s,/e. &MK /vew yc/?/c Y&o Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 2—NEW YORK. 373 An influenza epidemic swept over the district in October, keeping many people from work and slowing up business in general. This wTas fairly w^ell checked by November, and business was proceeding at top speed with most of the necessary adjustments to war condi tions effected when, on November 11, the armistice was signed. Then followed a period of uncertainty and hesitation with regard to the steps necessary to readjust business to a peace basis. Gradually Government restrictions, such as priority rules, were removed, and many lines were able promptly to return to approximately their prewar bases. Many other industries, however, felt obliged to pursue a waiting policy pending announcement of the Government's program for cancellations and the disposal of Government-owned stocks of raw materials. While the general attitude at the close of the year is one of caution, with buying limited to immediate require ments, jobbers and merchants are inclined to cooperate in effecting a gradual rather than a sudden decline in prices, and many manufac turers are disposed to retain their labor in spite of lessened output. Prices, as indicated by Bradstreet's commodity index, rose from $17.5996 on December 1, 1917, to $19.0376 on December 1, 1918, an increase of 8 per cent, indicating the decline in the purchasing power of the dollar during the period. LABOR. During the first 10 months of 1918 all lines of business and industry experienced great difficulty in obtaining and holding a sufficient supply of labor. The great scarcity of both skilled and unskilled labor led to high competitive wage offers, resulting in a large turn over. The increasing flow of women into industry helped somewhat to supply the demand, but the shortage, nevertheless, was great. The " work or fight77 order in July and Federal supervision of employ ment of unskilled labor helped the situation to some extent, but by the time these measures had become really effective matters were made worse again by the October influenza epidemic and the prospec tive operation of the enlarged draft law. Very soon after the armistice was signed the labor shortage practi cally disappeared. Here and there unemployment became notice able, especially where cancellation of Government contracts resulted in closing down important plants. Unemployment was evidently on the increase throughout the month of December, and some unrest was apparent. Reports of the New York State Department of Labor, based on returns from 1,648 representative firms employing one-third of the factory workers in New York State, show that while the number of employees decreased 1 per cent during the year ending November, 1918, aggregate wages increased 21 per cent, and that for the two-year Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

374 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. period ending November, 1918, aggregate wages increasd 43 per cent, while the number of employees increased only 6 per cent. INDUSTRIES AND STAPLES. Although limited during the winter by bad traffic, fuel, and weather conditions, and throughout the year by labor scarcity, the more essential industries in general operated at their maximum capacity up to the armistice. Less essential production was curtailed to a considerable extent, but such plants were often able to produce essential articles. The building trades were quieter than for many years, little construction other than necessary alteration and repairs being done, except for the Government or war industries. Steel production lagged somewhat through the first months of the year, due to the bitter weather and the fuel shortage. After that it began to approach the standard set in 1917 and gained an impetus which continued till well toward the end of the year. The present situation in the steel industry, however, is in marked contrast with that of a year ago. Then every effort was being made to meet war requirements; now the Government has practically retired from the market and steel makers face the necessity of readjusting to a peace basis, with great dullness in the building trades and the expected foreign demand not yet materializing. Maximum price-fixing by the Government was stopped January 1, 1919; before that time steel producers had made a reduction which averaged about $4 a ton on the various grades quoted, yet prices were still about $30 above those of 1907, the highest of recent prewar years. Pig-iron production during 1918 is estimated at 38,506,249 tons, which is slightly above that of 1917, and ingot production at 42,212,000 tons, which is sub stantially above that of 1917. For a variety of reasons the stock of copper in process was large at the end of 1916, despite the heavy demand throughout the year. The price was lowered from 26 cents to 23 cents in December, and at the close of the year to 20 cents, though these prices were really nominal and trading was at a standstill. Cotton prices fluctuated widely during 1918, ranging from 23 cents to 37.5 cents, the spot price at the year's end being 32.6 cents. The crop was larger than that of either 1917 or 1916. Mills worked at full capacity, largely on Government orders, and netted profits in excess of expectations. Woolen mill output was taken almost exclusively for Government purposes until toward the end of November. A decided fall in prices of woolen goods occurred during December. The country's wheat production for 1918 was 917,000,000 bushels, as against 636,600,000 bushels in 1917, and the Government's guar anteed price of $2.28 per bushel, which is to continue up to June, Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 2—NEW YORK. 375 1920, gave to the crop an extraordinarily high value. Corn pro duction, on the other hand, was 2,582,814,000 bushels, as against 3,000,000,000 bushels in 1917, and prices rose from $1,279 per bushel to $1,366. Other grains, with the exception of barley and rye, showed similar price tendencies. LOCAL CROPS. , The total value of farm products, including milk, in New York State is estimated at $801,840,360 for 1918, as compared with $659,787,980 for 1917. In many crops the actual yield increased as well as the value. The wheat crop, valued at $18,900,000, showed a production of 9,000,000 bushels as compared with 8,286,000 bushels in 1917. In corn the increase was nearly 10,000,000 bushels, the production being 30,852,000 bushels, valued at $55,065,000. Other crops showing a substantial increase in actual yield over 1917 were oats, onions, and cabbage. Buckwheat, rye, potatoes, beans, peaches, and grapes showed a decrease as compared with 1917, while hay decreased in tonnage but increased $14,000,000 in value. Similar data for northern New Jersey are not available. MERCHANDISING. Merchandising was iairly active throughout the year. During the first ten months, retail sales of less essential articles were con siderably curtailed due to war conditions, while demand for staples continued strong. The influenza epidemic caused a very excessive slackening in business during October. Following the signing of the armistice, retail sales increased decidedly in nearly all lines, due partly to the decrease of influenza, but principally to the relaxation of the rigid economies practiced during the war. The result was a holiday trade of record proportions. Up to the time of the armistice the purchases of jobbers and retailers seemed limited only by ina bility to obtain supplies. With the certainty of peace, however, buying became extremely conservative because of large stocks on hand and the belief that declining prices were to be anticipated. MONEY RATES. Mone}^ rates averaged firmer throughout the year than during 1917. During the first half of the year the call loan rate was subject to frequent fluctuations, ranging between 4 per cent and 6 per cent from January to August. From the middle of August until the beginning of November it remained steadily at 6 per cent and was only prevented from going higher by the cooperation of the money committee and its associated banks. After the armistice the rate fluctuated, declining to 4 per cent at times, but returning to 6 per cent at the close of the year. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

376 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. Rates on time loans secured by stock exchange collateral were somewhat nominal as demands for loans of this kind exceeded supply during most of the year. The rates quoted in January were 5f per cent to 6 per cent for two to four months' maturities; from late February to the middle of April 6 per cent was the uniform quotation. A slightly easier tendency then set in, which continued through August, carrying rates as low as 5J per cent to 6 per cent. Rates then rose again to 6 per cent and continued so until the last week of December, when distinctly easier conditions prevailed which carried rates down to 5| per cent to 5J per cent. The rate on commercial paper was consistently higher than during 1917, ranging from 5J per cent to 6 per cent throughout the year. The rates on bankers' acceptances have already been referred to. The chart above shows the rates on call money and commercial paper during the years 1917 and 1918. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 2—NEW YORK. 377 THE SECURITIES MARKET. Following a sharp upward turn in stock prices in the closing week of 1917, a fairly continuous rise continued throughout 1918, reach ing its high point about the middle of November, since which time prices have showed a declining tendency, although they retained at the end of the year a very substantial gain from the low point of December a year ago. In May and November there was trading in very heavy volume and indication of a strong upward movement. These movements, however, were not long continued, and the general course of the market has been a moderate upward rise with trading for the most part in moderate volume, the total number of shares of stock sold during the year being approximately 141,000,000, as against 184,000,000 in 1917. Unlike stock prices, prices of bonds listed on the exchange showed a declining tendency from January to April, a rather marked rise during May, followed by a further downward movement until the end of September, when apparently because of increased certainty of early victory for the allies, prices began a strong upward move ment which continued well into November. Though there was a slight fall between that date and the end of the year, the level reached was over three points above that of January, and about six points above the low point reached in December, 1917. Over four-fifths of the total volume of bond sales consisted of Liberty bonds. With the improvement in bond prices toward the end of the year it became possible in a limited way for railroad and other corporations, with good credit to place bond issues of fairly long maturity, instead of borrowing on short term issues. Several important issues were offered and oversubscribed during the closing weeks of the year. The charts on the following page, reproduced from '' The Annalist,'r show the movement of average prices for 50 stocks, half industrials and half railroads, and the trend of bond prices during 1917 and 1918. Following are figures, also taken from "The Annalist/' showing the volume of stock and bond sales, by months, during the year. Shares. Go b v o er n n d m s. ent To ( t i a n l cl a u ll d i b n o g n ds Government). January 13,504, $73,9 28,500 $107,2 65,000 February... 11,316, 61,2 81,500 84,7 08,500 March , 8,207, 99,5 52,500 119,6 36,000 April , 7,436, 110,7 83,000 128,2 71,500 May , 21,104, 135,9 66,500 166,4 78,000 June , 11,598, 120,3 82,000 143,5 19,000 July 8,347, 102,6 88,500 120,4 89,000 August 6,864. 147,3 39,000 167,2 88,500 September. 8,030! 156,1 75,000 179,6 96,500 October... 20,285! 176,3 90,500 233,9 84,500 November. 14,720; 202,5 58,500 256,2 11,000 December. 11,961, 310,0 56,000 385,7 11,000 Total 143,378,095 1,697,041,500 2,093,257,500- Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

378 ANNUAL REPOBT OF THE FEDERAL RESERVE BOARD. The Trend of Bond Prices—Average of 40 Listed Issues The Movement of Stock Market Averages The heavy tine shows the closing average price of fifty stocks, half industrials and half raOrtMris. The black area shows the high and low average prices of the twenty-five industrials and the whit* ares the corresponding figures for twenty-five rails. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 2—NEW YORK. 379 FOREIGN TRADE. Total exports from the United States during 1918 are estimated at $6,100,000,000, a decrease of about $100,000,000 from the pre ceding year; while imports are estimated at $3,100,000,000, an increase of about $100,000,000 over 1917. Exports from this customs dis trict, excluding Government shipments, aggregated $3,834,677,239, a decrease of $432,727,353 from 1917, and imports were $1,296,345,- 823, a decrease of $66,081,165. If exports carried on Government vessels, which did not clear at, or report to the customs house, were included, exports through this port would doubtless exceed those of 1917. New York's decrease in foreign trade was shared with other ports on the Atlantic coast, this whole division showing a decrease of 14 per cent in exports and 7 per cent in imports, while the Pacific coast gained 70 per cent in exports and 30 per cent in imports. This shifting in trade is the result of the slight decrease in exports to Europe, other than Government exports, coupled with the de cided decrease in imports from that continent and on the other hand, of the large gain in both exports to and imports from Asia and Oceania. Total imports from Europe are estimated at $350,- 000,000, compared with $550,000,000 in 1917 and $900,000,000 in 1912, a representative prewar year. Imports from Asia are esti mated at $900,000,000 against $758,000,000 in 1917 and from Oceania $165,000,000 against $100,000,000 in 1917. Exports to Asia are estimated at $450,000,000 as compared with $430,000,000 in 1917 and to Oceania $150,000,000 as compared with $117,000,000 in 1917. There was little change in the amount of either exports to or imports from South America as a whole. Imports from Mexico increased about 12 per cent while exports decreased slightly. There was a considerable increase in trade with Canada. Our excess of exports over imports during the European war totaled about $11,000,000,000, Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

380 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. EXHIBIT A.—Movement of principal earning assets of the Federal Reserve Bank of New York during the calendar year 1918, [In thousands of dollars; i. e., 000 omitted.] (1) (2) (3) (4) (5) (0) (7) Discount ed paper b S y s t o a e b U t c l e u i n s g r i a e w t d e a d r ] e di d O s p t c a h o p u e e n r r t . (1+2) m i b n B o a o r u i k l p g l e s e h n t t . T d b o i e s o d t c a u o l a g u b n h n d i t l . t ls Pe ( r 1 - c 5 e ) nt e a a T s r s o n e t i t a n s l . g tions. Jan. 4 150, 92,293 242,618 152,377 394,995 38.1 432,786 11.... 152, 79,905 232,430 150,982 383,412 39.8 457,188 18.... 157, 69,689 227,314 155,570 382,884 41.2 437,696 25.... 152, 70,199 222,620 168,278 390,898 39.0 411,742; Feb. 1.... 138, 77,079 215,529 177,407 392,936 35.2 407,792 8.... 117, 59,787 177,237 166,237 343,474 34.2 455,671 15... 97, 63,918 161,396 170,760 332,156 29.3 383,419 21... 110, 67,322 177,330 176,737 354,067 31.1 471,441 Mar. 1 129, 88,062 217,801 165,545 383,346 33.8 475,894 8.... 137, 86,271 223,296 178,256 401,552 34.1 528,073 15... 144, 96,576 241,146 182,116 423,262 34.2 565,452 22... 161, 87,662 249,280 179,905 429,185 37.7 586,637 28-29. 162, 84,949 247,917 130,887 378,804 43.0 550,915, Apr. 5 160, 74,086 234,513 127,743 362,256 44.3 547,488' 12... 288, 58,388 346,507 123,108 469,615 61.4 547,627 19... 356, 52,895 409,372 117,406 526,778 67.7 532,803 26... 379, 54,410 434,256 121,027 555,283 68.4 559,196 May 3.... 348, 52,225 401,092 124,463 525,555 66.4 529,660 10... 373, 76,723 450,024 126,650 576,674 64.7 655,586- 17... 304, 64,416 368,714 130,439 499,153 61.0 544,203 24... 380, 62,171 442,175 138,983 581,158 65.4 587,389 31... 340, 67,472 408,275 133,420 541,695 62.9 621,690 June 7 395, 66,129 462,099 130,580 592,679 66.8 622,776 14... 399, 69,194 468,535 127,966 596,501 66.9 603,324 21... 306, 76,992 383,303 123,458 506,761 60.4 512,797 J A S N D O u e e u o c l e p t y g v . . t . . . 4 5 6 2 1 1 2 1 1 2 2 2 1 2 3 1 9 2 6 2 8 1 2 1 2 2 1 5 0 8 6 9 2 0 8 7 3 3 0 9 6 5 . 0 2 7 3 - . . . . . . . . . . . . . . . . . . 1 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1 . . . . . , . . . . . 4 6 4 4 5 5 5 5 5 4 5 6 6 5 4 5 5 5 6 2 2 2 2 3 2 1 2 8 1 5 4 2 6 2 8 0 7 2 6 4 1 3 5 8 1 7 1 8 6 7 8 6 6 3 5 3 6 6 9 7 9 5 5 6 4 4 4 7 4 4 5 0 0 4 5 4 2 0 1 5 7 , , , , , , , , , , , , , , , , , , , , , , , , , , , 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 9 8 9 9 9 8 5 4 3 0 4 3 0 3 1 9 7 4 0 2 0 2 1 2 2 4 3 4 4 6 9 3 4 5 2 1 6 6 0 4 4 3 3 3 7 3 6 7 0 4 4 4 2 7 , , , , , , , , , , , , , , , , , , , , , , , , , , , 2 4 5 1 3 4 6 7 1 7 0 0 0 1 4 3 3 3 6 7 4 4 6 8 2 6 4 2 6 9 1 0 4 5 9 4 0 3 7 0 8 7 1 1 1 5 9 4 7 5 1 3 4 5 1 3 1 8 1 3 7 9 9 5 4 4 4 0 8 4 4 2 9 6 4 2 9 0 2 0 2 5 4 4 5 5 6 6 6 6 6 6 6 6 4 3 3 4 5 6 7 7 5 6 2 3 6 6 8 4 2 6 9 4 7 5 4 5 9 0 2 1 1 5 1 9 5 8 6 5 8 5 7 6 7 4 5 1 1 6 3 7 2 2 7 8 3 2 9 0 4 1 6 2 0 9 3 8 9 8 2 4 , , , , , , , , , , , , , , , , , , , , , , , , , , , 6 0 8 6 2 9 3 0 4 4 0 3 2 8 1 3 3 8 1 2 3 1 6 5 8 0 9 7 4 9 3 0 0 6 6 5 0 4 6 6 8 6 9 7 1 6 3 5 7 1 4 6 2 9 9 5 9 9 8 1 3 2 5 9 6 5 8 7 7 5 5 7 5 3 8 0 2 4 2 2 2 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 9 8 6 1 3 2 5 2 7 2 1 6 2 4 2 3 0 6 0 2 1 1 1 1 1 1 0 9 4 2 9 1 3 5 9 2 7 8 6 1 2 0 4 7 6 4 5 2 3 3 2 5 6 4 , , , , , , , , , , , , , , , , , , , , , , , , , , , 5 9 0 5 9 5 2 0 7 7 4 8 1 3 7 0 9 8 2 4 2 1 6 5 7 8 0 0 7 1 7 4 0 3 7 0 4 5 2 6 3 4 9 7 2 8 1 5 0 9 2 6 1 3 6 8 6 5 4 2 2 5 4 0 6 1 2 8 5 1 6 3 3 6 6 6 2 2 1 3 3 8 8 8 8 4 6 8 8 8 3 4 5 5 7 7 7 7 7 7 6 5 5 5 6 7 7 7 1 3 2 7 6 8 4 1 8 8 5 0 4 7 7 7 0 9 2 7 5 5 7 2 2 2 1 4 2 3 7 1 3 1 2 5 9 8 4 4 1 5 4 0 7 5 3 4 4 7 2 6 1 3 , , , , , , , , , , , , , , , , , , , , , , , , , , , 9 0 9 4 9 5 3 9 3 1 8 8 8 0 5 0 4 4 7 7 6 9 2 5 3 6 7 3 2 5 0 6 1 1 8 3 7 6 6 0 5 8 5 8 7 3 2 8 7 5 6 5 9 3 7 7 0 0 5 4 0 5 0 8 1 1 3 6 0 7 5 8 8 8 8 3 7 1 3 8 1 6 6 6 6 6 7 7 7 6 6 6 4 5 6 7 7 7 8 5 5 5 5 7 7 5 5 5 7 4 0 5 6 2 1 5 9 7 2 1 9 7 4 8 4 8 0 9 4 0 0 6 4 3 4 . . . . . . . . . . . . . . . . . . . . . . . . . . . 7 4 7 5 5 4 0 8 4 0 5 8 8 1 7 4 6 3 4 0 1 1 9 9 4 3 3 • 8 6 7 8 8 8 8 9 9 8 8 4 5 6 7 7 9 8 9 9 5 5 5 5 5 4 7 6 1 4 0 9 0 5 1 6 4 6 2 2 7 4 8 8 3 8 7 1 1 0 3 7 9 9 9 5 1 3 7 2 0 9 6 4 0 0 0 5 4 0 5 7 9 8 4 8 1 5 0 4 1 , , , , , , , , , , , , , , , , , , , , , , , , , , , 2 0 5 1 4 3 8 0 6 1 9 0 4 8 4 9 7 3 0 3 5 2 6 5 6 5 4 9 6 9 5 0 8 6 0 9 4 9 7 2 9 9 2 4 5 5 4 1 9 8 2 5 9 4 9 2 4 8 4 7 7 7 2 0 4 3 4 2 1 6 6 1 3 9 6 4 3 0 0 6 5 * - . Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 2—NEW YORK. 381 FEDERAL RESERVE BANK OF NEW YORK. I ^ MOffEMENTOF EARNING ASSETS } j DURING THE CAlENDARJEARlSld. f ^ G&rve /: IVar^banlPan^r. Gzriv2:Jofol3li[Jk3iscczmfed,. $ €Urve4:Sotzd£krnx>tgJ?sse£s, itwl. U.S. <JOV6rnm&t£Ssczir£6i6$. 8 * / \900\ to 'I \600\ \3S\ \so\ \*\ \0 4tlt8BltlS2it <f l£-Z£}S2&263K>17d43I7 HZ!28S1ZI9XZ3 !6aX6tSZ3Z>4IllSan<?giZ296l3&2'\ JAN. \FBB. I MCH. I APR. 1 MAY WUNE\ JULY \ JUS. \S£PT.\ OCT. | /VQy. \ DEC~. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

382 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. EXHIBIT B.—Movement of cash reserves, net deposits, Federal reserve note liabilities and the reserve percentage of the Federal Reserve Bank of New York during the calendar year 1918. [In thousands of dollars; i. e., 000 omitted.] (1) (2) (3) (4) (5) Ratio of cash re Federal serves to Reserve net de T r o e t s a e l r v c e a s s . h N po et s i d ts e . ac n t o u t a e l s c in ir (2+3) po F s e i d ts e r a a n l d culation. Reserve note liabil ities com bined. Jan. 4... 8640,449 $649,728 $402,900 $1,052,628 60.8 11.. 647,594 689,642 394,466 1.084,108 59.7 18.. 681,512 699,814 398,610 1,097,924 62.1 25.. 716,663 709,060 397,462 1,106,522 64.8 Feb. 1... 728,939 715.718 398,933 1,114,651 65.4 8.. 716,255 745,540 404,131 1,149,671 62.3 15. 734,370 682,224 412,449 1,094,673 67.1 21. 694,694 716,017 426,557 1,142,574 60.8 Mar.. 1.. 684,538 695,370 441,025 1,136,395 60.2 8.. 678, 705 730,452 451,781 1,182,233 57.4 15. 620,106 699,005 461,719 1,160,724 53.4 22. 650,091 741,594 469,752 1,211,346 53.7 29. 684,332 732,152 477,598 1,209,750 56.6 Apr. 5.. 703,264 739,605 485,233 1,224,838 57.4 12. 744,828 774,289 491,776 1,266,065 58.8 19. 711,656 720,948 496, 636 1,217,584 58.4 711,038 742,478 500,640 1,243,118 57.2 May 3... 735,128 731,063 508,560 1,239,623 59.3 10.. 735,903 852,880 511,004 1,363,884 54.0 17.. 708,919 717,333 507,826 1,225,159 57.9 24.. 710,674 763,313 506,342 1,269,655 56.0 3t.. 652,310 736.719 517,108 1,253,827 52.0 June 7... 684,387 749,376 536,764 1,286,140 53.2 14.. 705,992 745,005 537,918 1,282,923 55.0 21.. 751,183 690,637 546,707 1,237,344 60.7 28.. 853.123 837,944 562,848 1,400,792 60.9 July 5... 851,681 711,714 591,791 1,303,505 65.3 12.. 768,413 689,972 598,007 1,287,979 59.7 19.. 884,969 768,761 607,890 1,376,651 64.3 26.. 896,063 755,235 620,439 1,375,674 65.1 Aug. 2... 926,410 762,001 628,402 1,390,403 66.6 9... 876,985 740,875 638,917 1,379,792 63.6 16.. 798,687 704,423 640,879 1,345,302 59.4 23.. 728,728 738,765 649, 650 1,388,415 52.5 30.. 721,916 726,035 659,766 1,385,801 52.1 Sept. 6.. 755,426 761,648 678,298 1,439,946 52.5 13. 691,481 730,560 686,399 1,416,959 48.8 20. 662,477 740,561 693,083 1,433,644 46.2 27. 635.562 753,465 699,650 1,453,115 43.7 Oct. 4... 700,831 721,785 719,317 1,441,102 48.6 10.. 693,328 762,126 727,384 1,489,510 46.5 18.. 672,474 696,141 728,859 1,425,000 47.2 25.. 655,720 819,690 721,939 1,541,629 42.5 N De o c v . . 2 2 1 6 8 2 2 1 1 7 0 3 9 2 5 . . . . . . . . . . . . . . . . . . . . . 6 7 7 6 6 6 7 6 7 6 3 4 6 0 4 0 3 2 4 0 8 7 9 9 3 7 6 . , , , , , , , , 1 6 6 2 8 9 1 4 2 2 5 3 3 0 6 5 6 9 4 4 0 2 9 8 5 1 5 8 7 7 7 7 7 7 7 7 0 4 6 6 8 8 6 6 8 5 6 8 9 3 4 7 3 1 , , , , , , , , , 4 8 1 2 0 2 5 2 4 1 6 3 8 2 1 3 5 3 5 3 9 8 3 7 4 2 0 7 7 7 7 7 7 7 7 7 1 3 2 3 2 2 3 1 2 8 0 3 4 2 1 6 8 0 , , , , , , , , , 4 3 0 0 7 5 5 2 5 8 5 6 6 8 4 1 9 5 3 5 5 7 4 4 8 4 2 1 1 1 1 1 1 1 1 1 , , , , , , , , , 5 4 5 4 4 4 5 4 5 0 1 9 8 6 9 2 9 0 2 5 9 9 8 8 4 2 3 , , , , , , , , , 5 5 0 7 4 6 6 5 5 4 7 1 8 8 2 4 8 7 1 8 7 2 2 2 7 2 2 4 4 4 4 4 4 4 4 4 2 3 6 8 3 3 4 6 9 . . . . . . . . . 5 8 3 1 6 6 9 7 7 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 2—NEW YORK. 383 FEDERAL RESERVE BANK OF NEW YORK. DEPOSIT AND NOTE LIABILITIES, ALSO CASH RESERVES, DURING THE CALENDAR YEAR 1318. fi €urv&4.Jtcvbw of Castu/teserpes toJlggregate ll J&£Zkfiosittmd. JF&.jVote/uz&iltfies. -to? i/0- \B6U\ *r- \eob-axA \ss- VOSD \so Ur 900 VSO \600\ \4S0 \3O0 ISO t // 18X14 ISZ /<T /S&&SiZT9X310l?ZW? HB 2SS12&IS2S 1623306132027411 I82£l61522296l3aj27\ JAM. 1 FEB. I MCtt.\ APR- \MAY\JUNE\ JULY \AUO. \SEPT.\ OCT. \ NOV\ DEC. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

384 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. SCHEDULE 1.—Balance sheet. Dec. 31, 1918. Dec. 31, 1917. Dec. 31, 1916. KESOURCES. Reserves: Gold with Federal Reserve agent $274,392,165.00 $250,598,565.00 $107,003,765.00 Gold redemption fund for Federal Reserve notes 25,000,000.00 10,000,000.00 250 000 00 Gold settlement fund 66,790,455.76 5,854,000.00 20,570,'000.'00 79,101,340.83 68,113,616.99 Gold coin and certificates 179,674,646.70 275,130,455.00 159,321,257.50 Legal tender notes 43,038,200.00 31,322,275.00 11,188,200.00 Silver certificates and coin 4,531,976.85 8,925,743.85 4,077,274.80 Total reserves 672,528,785.14 649,944,655.84 302,410,497.30 Loans and discounts: Bills discounted for member banks 697,341,455.69 225,117,913.30 7,071,158.55 Acceptances purchased 77,576,632.94 148,770,185.44 41,457,184.04 Rediscounts for other Federal Reserve Banks.. 25,191,033.66 United States bonds 1,447,700.00 5,168,599.64 1,042,550.00 521,000.00 4,493,000.00 1,205,000.00 United States certificates of indebtedness 93,374,500.00 15,000,000.00 United States securities held to secure Federal 34,955,000.00 Municipal warrants 510,701.32 972,311.62 Total investments 905,216,288.63 424,251,433.36 51,748,204.21 Other resources: Federal Reserve notes and other cash 97,048,219.95 59,752,685.24 13,865,897.40 751,000.00 Redemption fund Federal Reserve bank notes- 1,689,250.00 Items in process of collection 145,736,177.53. 48,091,790.20 23,077,418.64 Exchanges for clearing house and sundry cash 36,401,491.78 26,429,660.74 2 503 168 21 6,770,374.11 Interest accrued on United States bonds 172,878.27 73,620.28 12,501.88 Deferred charges and prepaid expenses 150,194.29 20,458.22 8,753.52 Advances made for Treasurer United States, account expenses Liberty loan and war sav- 3,023,724.56 360,350.01 2,317,692.39 235,598.86 Total other resources 294,061,002.88 134,728,564.69 39,703,338.57 Total resources 1,871,806,076.65 1,208,924,653.89 393,862,040.08 LIABILITIES. Capital: 20,820,100.00 18,695,950.00 11 865 750 00 8,322,040.00 649,363.56 Profit and loss 163,063.98 Total capital fund 29,142,140.00 19,345,313.56 12,028,813.98 Deposits: Due to United States Government 5,705,629.16 11,870,767.74 3,571,391.94 95,976,172.85 3,335,930.00 705,062,061.27 652,791,808.26 237,907,354.87 Due to member banks, uncollected funds 72,173,899.90 35,553,478.43 18,552,984.84 Due to nonmember banks, deposit account 5,382,207.29 10,317,630.16 Due to other Federal Reserve Banks, col lected funds 78,986,137.26 7,610,609.86 12 373,721.91 Due to other Federal Reserve Banks, uncol lected funds 6,934,425.41 5,156,779.75 2,085,975.49 Cashiers' checks outstanding 4,998,919.04 4,821,683.09 188,275.81 Gross deposits 975,219,452.18 731,458,687.29 274 679.704 86 Notes: Federal Reserve notes outstanding 819,015,835.00 456,338,565.00 107,003,765.00 33,785,000.00 Total 852,800,835.00 456,338,565.00 107,003,765.00 Other liabilities: Depreciation reserve account 505,255.00 205,880.00 Unearned discount and interest 1,308,769.90 1,348,238.04 149 756.24 Participation certificates Liberty loan bonds... 34,410.00 227,970.00 12,795,214.57 Total other liabilities 14,643,649.47 1,782,088.04 149,756.24 Total liabilities * 1,871,806,076.65 1,208,924,653.89 393,862,040.08 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 2—NEW YORK. 385 SCHEDULE 2.—Income and expense statement. 1918 1 1917 INCOME. Bills discounted for members . ! $17,736,260.94 $2,455,532.87 AcceDtances bought 5,411,820.70 1,843,324.87 United States securities 1,561,839.17 378,668.40 Municipal warrants 2,621.23 66,470.41 14,335.50 Commissions received 22,645.93 38,537.54 Profit on bills sold 10,393.07 8,077.03 Penalties for deficient reserves 27,191. 89 18,565.29 Service charges 50,167.06 80,922.53 Sundry profits 491,795.99 24, 779.51 Total. 25,314,735.98 i 4,929, 213.95 EXPENSE. Directors' fees, outside conferences, and Federal Advisory Council 22,618. 96 18,301.61 Salaries 1, 298,474. 26 ! 398,282.81 Rent • 139,007.62 55,550.91 170,933.02 42,145.52 137,960. 30 Telephone and telegraph 33.053.49 99', 439. 80 47,204. 28 35, 294. 48 48,459. 52 20,491.24 General expense 121, 779. 43 329,096.98 Cost of. Federal Reserve notes 335,043. 65 343,764.88 Assessment for expenses of Federal Reserve Board 100, 876.18 50, 252.09 Total 2,680, 702.68 1,195,249.28 Net earnings 22,6347033730" 3,733,964.67 132,058.91 158, 708.77 Total 22, 766,092. 21 3,892,673.44 Deductions December 31, 1918: Additional transfer to depreciation reserve account $299,375.00 Estimated value of buildings now standing on site, 803,800.00 1,103,175.00 Dividends paid during 1918: Jan. 1 to June 30 586,271.98 July 1 to Dec. 31 608,754.22 1.195,026.20 Reserve for franchise tax 12,795;214.57 7, 672, 676. 44 Total 22, 766,092. 21 SCHEDULE 3.—Discount rates. Months. ( i 1 l l o i n o a 5 n r g a t c e d l n l c e r a u s o s a y ) d l s l . s d c 1 a l 6 y u s s to , i v in 9 e 0 . m A 9 p 1 t o g a t u o r n p d r i t c e a 6 a h u r l y , s l s . b e L c i s U S c o S n d e a i e p n n d t c n b t b r e a e d i u e t e e y c t t s i s r b s f r e e i e o i s t a s t d o y d , f l r | n G c f S c i m o 1 o o w t n o p e - t i n v a d e e l r e o i n l n a e a c s t n n a e h l c r y i t i t a n c n l 9 a a T 0 c 1 n r c 6 d c a e a e d t p y s o e t , s . b 1 a c a R . a d c 5 o n n e a - c u c o 6 k d e y e f n 0 p i e s s - t s . t r , 9 s s 0 ' A r u i a O a z t t p c e h p e d b c u o s e e a . r r n c p n - h t k m a a e n A a s r r c e r s a c k e s ' t t , s e e u . t s a . l 16-90 ing. days. Per cent, Per cent. Per cent, Per cent, Per cent Percent.' Per cent. Per cent. Per cent. January 31 4* 5 4 3-41 4 3-41 31-41 February... 31 41 5 4 3-41 4 3-41 31-41 A M p a r r i c l h 1 -5... 3 3 1 1 44I 1 5 5 4 4 3 3 - - 4 4 1 | 4 4 3 3 - - 4 4 1 1 3 4 1 - - 4 4 1 1 A M p a r y i l 6-30.. 4 4 4 4 | 2 5 5 4 4 1 1 4 4 1 1 M M i i n n . . 4 4 4 4- - 4 4 f 1 June 4 4f 5 41 4| Min. 4 4 -4f July 4 4f 5 4| 41 Min. 4 13 August 4 4f 5 41 4| Min. 4 September.. 4 4f 5 4i 41 Min. 4 October 4 4| 5 41 41 4 41 4-1 Min. 4 4-41 November.. 4 4f 41 4$ 4 4.1 41 Min. 4 4-4| December.. 4 4? 41 41 4 41 4?, Min. 4 4-4| 4-4VW Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

386 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. SCHEDULE 4.—State banks admitted to system during 1918. Admitted to membership, Bank or trust company. Location. Resources. 1918. Bloomfield Trust Co •$3,980,809.35 Trust Company of Fulton Count v. 1,096,337.04 Hudson Trust Co Hoboken, N. J 24,834,270.11 Lincoln Trust Co New York, N. Y„ 22,716,183.28 Peoples Bank & Trust Co Passaic, N. J 6,354,359.68 Peoples Bank & Trust Co Westfield, N. J 2,206,055.70 February Farmers Loan & Trust Co New York, N.Y ... 195,244, 763.59 Peoples Trust & Guaranty Co Hackensack, N.J 6,178,884.38 The Bank of Hammondsport Hammondsport, N. Y.. 928 171.87 Rutherford Trust Co Rutherford, N. J 1,467,624.92' March Peoples Trust Co Binghamton, N.Y 5,142,020.30 Commercial Trust Co. of New Jersev Jersey City, N. J... 32,340,202.34 Trust Co. of Wyoming County Warsaw, N. Y 752,403.25 April Olen Ridge'Trust Co Glen Ridge, N. J 1,176,459,86 Ithaca Trust Co Ithaca, N.Y 3,150,215. m Workers Trust Co Johnson Citv, N. Y 1,923,885.43 Nassau County Trust Co Mineola, N. Y 2,430,346.92 Montclair Trust Co Montclair, N.J 3,960,638.14 Power City Bank Niagara Falls, N. Y. , 9,365,827.67 Schenectady Trust Co Schenectadv, N.Y 6,956,030.22 May Savings Investment <& Trust Co East Orange, N.J 9,894,876,94 June Fulton Trust Co New York, N.Y 9,268,016.24 New Jersey Title Guarantee & Trust Co Jersey Citv, N.J 16,135,179.24 Montgomery County Trust Co 2,734,794.60 July First State Bank Canisteo, N. Y 552,322.09 Commercial Exchange Bank New York, N. Y 8,920,147.25 Filth Avenue Bank of New York. New York, N. Y 25,438,952.05 New Netherland Bank New York, N. Y 7,031,510.21 Bank of Suffolk County Stony Brook, N. Y 394,929.61 The County Trust Co White Plains, N. Y 3,043,852.76 August .„,„.„... Bank of Amityville Amityville, N.Y 599,358.88 Cranford Trust Co Cranford, N. J 1,489,602. 24 Erie County Trust Co 1,092,579.59 Jefferson Trust Co Hoboken, N. J 4,363,259.33 Oyster Bay Bank Oyster Bay, N.Y 1,270,314.21 Mutual Trust Co. of Westchester County Port Chester, N. Y 2,242,711.20 Westfield Trust Co Westfield, N.J 2,202,034.48 September ..... Seacoast Trust Co 1,978,786.27 Bayonne Trust Co Bayonne, N. J.. .*. 4,159,396.89 State Bank of Chatham Chatham, N. Y 1,534,480.35 Herkimer County Trust Co Little Falls, N. Y 4,660,440.77 Bank of Millbrook Millbrook, N. Y. 677,703.27 Rockland Countv Trust Co Nyack, N. Y 2,124,275.39 South Norwalk Trust Co South Norwalk, Conn... 3,049,727.25 The State Bank Trumansburg, N.Y 368,934.77 Bank of Westbury Westbury, N. Y 481,839.34 Yorkville Bank New York, N.Y 10,885,255.90 October ;.... Farmers <fe Merchants Bank Boonton, N.J 480,869.99 Bank of Hicksville Hicksville, N.Y 986,407.62 Federal Trust Co Newark, N.J 9,793,898.23 Columbia Bank New York, N.Y 18,293 353.40 Citizens Bank Perry, N. Y 1,330,203.89 Alliance Bank Rochester, N. Y 15,518,076.66 November Floral Park Bank Floral Park, N. Y 706,034.53 Morristown Trust Co 9,225,186.77 Mutual Bank , ........ ..... . „ New York, N.Y 10,872,924.46 Trust Co. of Orange ... ... Orange, N.J 957,837.10 Syracuse Trust Co* Syracuse, N.Y 17,821,127.40 Trust & Deposit Co. of Onondaga. 24,364,091.32 SCHE DITLE 5.—Foreign branches ofA merican banks, December 31,1 918. American. Foi* eign Banking Corporation: Equita ible Trust Co.: Branches — Br anches—• Port an Prince, Haiti. Paris,1 France. Pana ma City, Republic of Pana- London,1 England, Farme rs Loan and Trust Co ma L. Br anches—• Crist obal, Canal Zone, London (2),1 Engiai id. Havsi na, Cuba. Paris,1 France. Empire Trus<. Co.: Bordeaux, Prance. Branch- St. Nazaire, France LoneI on,1 England. Neuf chateau, Franc se. Digitized for FRASER » Branches established before August, 1914. http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. -NEW YORK. 387 SCHEDULE 5.—Foreign 'brandies of American banks, December 31,1918—Continued. Guaranty Trust Co.: Mercantile Bank of the Americas—Con. Branches—• Affiliated Institutions—Continued. London,l England. Banco Mercantile Americano del Paris, France. Peru—Continued. Tours, France. Arequipa, Peru. Brussels, Belgium. Chiclayo, Peru, Buenos Aires, Argentina. Callao, Peru. International Banking Corporation: Banco Mercantile Americano de Branches— Colombia— London,1 England. Bogota, Colombia. Yokohama,1 Japan. Barranquilla, Colombia. Kobe,1 Japan. Cartagena, Colombia. Shanghai,1 China. Medellin, Colombia. Pekin,1 China. Cali, Colombia. Hankow,1 China. Manizales, Colombia, Tientsin,1 China. Banco Mercantile Americano de Hong Kong,1 China. Cuba— Canton,1 China. Havana, Cuba. Manila,1 Philippine Islands. Mercantile Overseas Corpora Cebu,1 Philippine Islands. tion—• Singapore,1 Straits Settlements. Guayaquil, Ecuador. Maracaibo, Venezuela. Batavia, East Indies. National Bank of Nicaragua- Sourabaya, East Indies. Calcutta,1 India, Managua, Nicaragua. Bombay,1 India. Bluefields, Nicaragua. Panama,1 Republic of Panama. Leon, Nicaragua. Colon,1 Republic of Panama. Granada, Nicaragua. Panama Banking Corporation: Medellin, Colombia. Branches: Santo Domingo, Dominican Re Colon,1 Republic of Panama. public. Panama,1 Republic of Panama. San Pedro de Macoris, Domin National City Bank: ican Republic. Branches- Santiago, Dominican Republic. Havana,1 Cuba. Puerto Plata. Dominican Re Cienfuegos, Cuba. public. Matanzas, Cuba. Mercantile Bank of the Americas (Inc.;: Santiago, Cuba. Branches—• Sagua la Grande, Cuba. Paris, France. San Juan, Porto Rico. Barcelona, Spain. Caracas, Venezuela. Affiliated Institutions- Bahia, Brazil. American Mercantile Bank of Rio de Janeiro, Brazil. Brazil— Sao Paulo, Brazil. Para, Brazil. Santos, Brazil. Pernambuco, Brazil. Santiago, Chile. Banco Mercantile Americana de Valparaiso, Chile. Caracas*—• Buenos Aires,1 Argentina. Caracas, Venezuela. Montevideo, Uruguay. La Guayra, Venezuela. Genoa, Italy. Banco Mercantile Americano del Moscow, Russia. Peru- Petrograd, Russia. Lima, Peru. Vladivostok, Russia. t- Branches established before August, 1914. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

888 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. SCHEDULE <].—American branches of foreign banks, December 31, 1918. African Banking Corporation: Commercial Bank of Spanish America: New York.1 New York.1 Anglo-South American Bank (Ltd.): San Francisco. New York.1 Credito Italiano: Banca Commerciale Italiana: New York (agency). New York. Hongkong & Shanghai Banking Corpora Banca di Napoli: tion: New York.1 New York.1 Chicago. San Francisco.1 Banco Nacional de Cuba: London & Brazilian Bank (Ltd.): New York.1 New York.1 Bank of Montreal: London & River Plate Bank (Ltd.): New York.1 New York.1 San Francisco.1 Merchants Bank of Canada: Chicago.1 New York.1 Spokane. National Bank of Santo Domingo: Bank of Nova Scotia: New York.1 New York.1 National Bank of India: Boston.1 New York.1 Chicago.1 National Bank of South Africa: Bank of British West Africa (Ltd.): New York. New York. Philippine National Bank: Bank of Taiwan (Ltd.): New York. New York (agency). Royal Bank of Canada: Banque Beige Pour 1'Etranger: New York.1 New York. Standard Bank of South Africa (Ltd.): Banque Nationale de la Republique New York.1 d'Haiti: Sumitomo Bank (Ltd.): New York. San Francisco. Canadian Bank of Commerce: Seattle. New York.1 New York (agency). Portland, Or eg.1 Union Bank of Canada: San Francisco.1 New York.1 Seattle, Wash.1 Yokohama Specie Bank (Ltd.): Chartered Bank of India, Australia, and San Francisco.1 China: Seattle. New York.1 Los Angeles.1 Colonial Bank of London: New York.1 New York.1 »Branches established before August, 1914. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 2—NEW YORK. 389 SCHEDULE 7.—Employees of the banh. Total, Total, Men. Women. 1918. 1917. BANK DEPARTMENTS. Accounting and reconciling.. 12 Accounting reference files... 20 Adjustment 19 Architectural 2 Auditing 106 Bookkeeping 41 Cafeteria 26 Chief clerk 8 City collection 35 Code 2 Complaint and fraud Comptroller Country collection Coupon collection Credit Custody Discount Distributing Employment Federal Reserve agent...... Filing and library Float force Foreign exchange Gold shipments Mail—officers' Mail—outgoing Mail teller—day Mail teller—night Miscellaneous Money 35 39 Money shipments 7 Note teller 0 Officers' assistants 3 Pages 11 11 9 Paying teller 3 3 2 Porters 21 21 17 Protection 21 21 25 Protection—night 15 15 Purchasing 3 8 Receiving teller 3 3 Reserve penalties 3 Return items 8 20 17 Secretaries 1 : 9 3 Signatures 1 1 Special statements 0 4 10 Stenographers 2 24 26 23 Supply 2 2 4 2 Telegraph 2 2 4 Telephone 12 12 6 Transit—day 32 308 340 167 Transit (5 p. m. to 12 p. m.).. 10 63 75 Transit (12 p. m. to & a. m.). 3? 3? Vault 4 4 2 Warehouse 4 4 Welfare 11 Wire transfer Total. 1, 350 GOVERNMENT DEPARTMENTS. Bond issue and exchange... 115 105 Capital issues committee 4 i 1 Coupon payment 4 j 19 Custody 40 I 2 Government check 31 i 11 Government deposit 44 i 19 Certificate of indebtedness: Clerical 38 Sales 4 ! Total. 280 192 LIBERTY LOAN ORGANIZATION. Administration 33 28 Distribution 36 63 Partial payment—third.. 45 272 Partial pavment—fourth. 53 77 Publicity 103 98 Total 270 538 Grand total. 1,135 1,495 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

390 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. SCHEDULE 8.—Certificates of indebtedness. Loan. D is a s te u e o . f M d a a tu te r , i ttyy Rate. Total sale. m T e o d n t i t a s , l t r s a i e l c c l t o o . t n d Per cent. Jan. 2,1918 June 25, 1918 14 $491,822,500 $239, 954,000 Third., .Tan. 22,1918 Apr. 22, 1918 4 400,000,000 2 209, 685,000 Third. Feb. 8,1918 May 9, 1918 4 500,000,000 241, 322,000 Fob. 15,1918 June 25, 1918 14 74,100,000 14: 007,500 Third.". Feb. 27,1918 May 28, 1918 *h 500,000,000 3 172, 666,500 Third. Mar. 20,1918 June 18, 1918 44 543,032,500 193 700,500 Mar. 15,1918 Juno 25, 1918 14 110,962,000 io; 252,500 Third".. Apr. 10,1918 July 9, 1918 U 551,226,500 215, 448,000 Third. Apr. 22,1918 July 18, 1918 *k 517,826,500 222, 486,000 Apr. 15,1918 June 25, 1918 i 4 71,880,000 12, 000,500 May 15,1918 do... ..... i 4 183,767,000 61, 188,000 Fourth June 25; 1918 Oct. 24, 1918 4-i 839,646,500 312, 844,500 Fourth July 9,1918 Nov. 7, 1918 4i 753,938,000 273 219,500 Fourth July 23,1918 Nov. 21, 1918 H- 584,750,500 211, 714,000 Fourth Aug. 6,1918 Dec. 5, 1918 •H 575,706; 500 207, 287.000 Aug. 20,1918 July 15, 1919 14 157,552,500 44, 766; 000 Fourth" Sept- 3,1918 Jan. 2, 1919 4* 639,493,000 210, 068,500 Fourth Sept. 17,1918 Jan. 16, 1919 4-1 625,216.500 216i 264,500 Fourth Oct. 1,1918 Jan. 30, 1919 U 641,069,000 249. 591,000 Nov. 7,1918 Mar. 15, 1919 *4£ 794,172,500 350; 847,500 Fifth."! Doc. 5,1918 May 6, 1919 4| 613,438,000 222; 830,000 Fifth.. Dec. 19,1918 June 20, 1919 41 572,494,000 199, 117,000 10,742,094,000 1,091,260,000 1 Tax certificates. 2 Subscription of ,$230,017,000. * Subscription of $197,715,000. SCHEDULE 9.—Liberty loan subscriptions. THIRD LOAN. Amount of Number of Class. subscriptions. subscribers. $50.. $96,284,350 1,925,687 $100 57,711,700 577,117 $150 to $450 69,651,100 298,921 $500 46,789,500 93,579 $550 to $950 3,072,300 4,417 106,447,000 106,447 $1*050 to"$4,*950V.-."." 35,509,650 15,800 $5,000 38,175,000 7,635 $5,050 to $9,950 9,533,050 1,371 $10,000 60,060,000 6,006 $10,050 to $50,000.. 127,456,850 4,628 $50,050 to $100,000. 68,557.600 763 $100,050 to $200,000, '50,145,050 322 Over $200,000 345,850,500 430 Total 1,115,243,650 3,043,123 FOURTJrl LOAN. $50 $113,958,250 2,279,165 $100 88,741.300 '887,413 $150 to $450 33,005; 800 138,509 $500 43,682,000 87,364 $550 to $950 9,733,100 14,483 $1,000 118,376,000 118,376 $1,050 to $4,950 81,242,250 35,570 $5,000.' 68,225,000 13,645 $5,050 to $9,950 32,927,400 4,710 $10,000 104,830,000 10,483 $10,050 to $50,000.. 279,570,800 10,596 $50,050 to $100,000. 156,613,950 1,886 $100,050 to $200,000 145,827,950 933 Over $200,000 768,167,950 967 Total 2,044,901,750 2,069,806.17 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 2 NEW YORK. 391 SCHEDULE 10,—Ratio of subscriptions received, third and fourth loans. THIRD LOAN. Number Number Ter cent Class of bank. in d i s s e tr c i o c n t. d subscrib- su A b m sc o ri u p n t t i o o n f s. su of t b i s o t c o n r t . i a p l National banks 625 624 $541,400,250 48.6 State banks , 229 228 147,024,900 13.2 Trust companies 202 193 393,092,200 35. 2 Savings banks 178 105 21,990,850 2.0 Individuals (including foreign and private bankers). 11,735,450 1.0 Total.. 1,115,243,650 100.0 Quota, $900,000,000. FOURTH LOAN. National banks ,. '. 625 622 $962,662,650 47.1 State banks 229 228 272,686,300 13.3 Trust companies 202 196 759,660,100 37.2 178 89 26,440,250 1.3 Individuals (including foreign and private bankers). 23,452,450 1.1 Total 2,044,901,750 100.0 | Quota, $1,800,000,000. SCHEDULE 11.—Subscriptions, third and fourth loans, by geographic subdivisions. THIRD LOAN. Division. Quota. su A b m sc o ri u p n t t i o o n f s. N su u b m e s r b c s. e r r i b of Av si e z r e a . ge S ti c u o a b n p s s i c t p r a i e . p r Subdistrict No. 1 (Buffalo and vicinity).. $43,626,500 $57,525,500 286,426 $201 $56.51 Subdistrict No. 2 (Rochester and vicin ity) 20,969,400 24,777,450 115,090 215 41.74 Subdistrict No. 3 (Utica and Syracuse and vicinity) 29,071,800 35,669,550 183,152 194 41.66 Subdistrict No. 4 (Binghamton and vi cinity) 9,449,900 13,248,550 74,474 178 33. 53 Subdistrict No. 5 (Albany and Troy and vicinity) 34,691,000 48,346,150 201,346 240 40. 69 Subdistrict No. 6 (Long Island).. 10,872,100 12,527,500 50,966 245 38. 98 Subdistrict No. 7 (Northern New Jersey). 71,925,000 114,867,200 495,041 232 52.14 Subdistrict No. 8'(Westchester Countv, N. Y., and Fairfield County, Conn.)*.. 17,666,300 34,539,850 181,750 190 56.25 Total outside of Greater New York. 238,272,000 341,500,750 1,588,245 215 48.18 Manhattan.. 618,794,000 701,167,700 1,248,327 561 276.42 Brooklyn 39,616,900 53,001,950 116,855 453 29. 46 Bronx 3,317,100 5,361,150 24,417 219 8.70 Richmond *. 1,032,900 3,386,800 19,262 176 34. 33 Queens1 4,364,400 10,825,300 47,493 228 27.29 Total, Greater New York. 661,728,000 773,742,900 1,456,354 531 Total for the district 900,000,000 1,115,243,650 3,044,599 88.98 * Parts of, but not included in figures for subdistrict No. 6. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

392 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. SCHEDULE 11.—Subscriptions, third and fourth loans, by geographic subdivisions—-Gon. FOURTH LOAN. Number of Subscrip Division. Quota. su A b m sc o ri u p n t t i o o n f s . sub e s r c s r . ib Av si e z r e a . g e ti c o a n p s i t p a e . r _L Subdistrict No. 1 (Buffalo and vicinity). $87,253,400 $95,231,250 324,310 $293 $93.55 Subdistrict No. 2 (Rochester and vicin ity) 42,214,800 45,628,100 191,997 237 76.87 Subdistrict No. 3 (Utica and Syracuse and vicinity) 58,143,600 63,054,850 219,833 286 73.64 Subdistrict No. 4 (Binghamton and vi cinity) 18,900,000 22,225,900 100,851 220 56.25 Subdistrict No. 5 (Albany and Troy and vicinity) 69,382,000 77,653,100 224,847 345 65.36 S S u u b b d d i i s s t t r r i i c c t t N N o o . . 7 6 ( ( N L o o r n t g h e I r s n l a N n e d w ) Jersey). 10,841,400 1 1 9 9 9 , , 2 1 2 3 8 1 , , 9 1 5 5 0 0 62,077 3 3 2 0 7 9 9 8 0 6 . .9 3 4 9 Subdistrict No. 8 (Westchester County, 143,850,000 607,089 N. Y., and Fairfield County, Conn.)... 35,332,400 53,029,700 215,310 246 86.37 Total outside of Greater New York. 465,917,600 575,183,000 1,946,314 295 81.14 Manhattan. 1,236,605,800 1,339,841,950 1,168,270 1,146 528.17 Brooklyn... 79,233,800 101,032,950 290,453 347 56.17 Bronx. 6,634,200 5,812,300 34,140 170 9.44 Richmond1. 2,173,900 5,109,650 33,660 152 51.80 Queens1 9, 434,700 17,951,900 131,263 136 45.25 Total, Creater Now York. 1,334,082,400 1,469,748,150 1,657,786 886 269.86 Total for the district 1,800,000,000 2,044,901,750 3,604,100 567 163.14 1 Parts of, but not included in figures for subdistrict No. 6, SCHEDULE 12.—Expenses of third and fourth Liberty loans to December 31, 1918. THIRD LOAN. Fiscal agency organization. Liberty loan organization. Expense classifi cation. i B ss o u n e d . in c C d a e e t r e b t s i t f o e i f d G m ov e e n r t n Di t s i t o r n ib . u Publicity. A t d ra m ti i o n n i . s Total. ness. deposit. Salaries, regular $144,649.81 $41,476.45 $53,031.35 $396,974.97 $225,401. 28 $25,159. 65 $m, 693. 51 Salaries, overtime— 8,202.31 5,560.62 7,226.29 50,799.10 13,833. 52 2,284. 64 87,906.48 Printing, stationery, and forms ".. 15,017.47 4,138. 73 2,391.77 189,640.02 16,331.22 24,365.57 251,884.78 Printingcirculars and descriptive matter. 2,050.00 756.58 491.62 83,302.32 143,270.82 9,859. 80 239,731.14 Traveling expenses.. 1,106.54 2.40 45,677.08 20,485.22 24.14 67,295.38 Telephone and tele graph 2,964.56 1,627.75 792.11 17,009.65 8,357. 85 747. 55 31,499.47 Expressage 247. 88 22.26 8,239.03 14,030.73 2,984.47 25,524.37 Postage 6,560. 38 10.00 71.08 4,542.26 357.06 8.77 11.549.55 Equipment 23,736. 48 4,038.25 2,013.19 40,871.03 18,226.33 8,372. 75 97,258.03 Rent 12,687.43 2,585.13 3,172.33 42,628.30 8,774. 74 10,778. 60 80,626.53 Newspapers and di rectories 1.50 103. 65 276. 50 3,533.11 7.00 3,921.76 Bands, music, and speeches 18,932.63 21,617.83 40,550.46 Banners, booths, and signs 34,993.31 75,781. 86 174. 25 110,949.42 Miscellaneou-bSupphes 11,705. 31 1,648.32 395. 42 31,250.95 17,017.01 11,359.12 73,376.13 General plant service 57,750. 74 1,331.45 810. 24 70,708.28 34,534. 56 1,113.67 166,248.94 Total 286,680.41 63,197.94 70,499.05 1,035,845.43 621,553.14 97,239. 98 2,175,015.95 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT ^0. 2—NEW YORK. 393 SCHEDULE 12.—Expenses of third and fourth Liberty loans to December 31, 1918— Continued. FOURTH LOAN. Fiscal agency organization. Liberty loan organization. Expense classifi cation. i B ss o u n e d . in c C d a n e e t e r e b t s s i t s f e . o i d f G de m o p v e o e n s r t i n t . Di t s i t o r n ib . u i Public-it v. A t d ra m ti i o n n i . s Total. Salaries, regular $107, 606. 02 $41,746.17 $34,033.57 $217,384.11 $246,655. 45 $37,626.24 $685,051.56 Salaries, overtime 15, 386.39 5,925. 51 1,630.66 41,085.07 31,576.62 4,396.89 100,001.14 Printing, stationery, and forms 3,758.39 3,163.26 272,667.06 27,865. 34 14,424. 71 332,926. 84 Printin g circulars and descriptive matter. 536. 73 4,380.09 135.00 41,188.24 235,983.61 2,480. S3 284,704. 50 Traveling expenses.. 11.30 37,744.19 20; 432. 59 97.91 58,285. 99 Telephone and tele graph 18.28 197. 77 12,215.25 1,060.14 1,851.27 15,342.71 Expressage 204. 66 .61 7,882. 60 19,619.16 4,233. 39 31,940. 42 Postage i, 023.17 50,521.34 347. 59 171. 50 56,063. 60 Equipment \, 713. 94 2,230. 73 654. 00 51,188. 65 21,347.91 7,374. 50 91,509. 73 Rent ', 021. 32 1,801.64 1.248.34 33,604.74 14,808. 59 3,155. 65 61,640.28 Newspapers and di rectories 13.65 1,150.12 3,170. 67 3.78 4,391.47 Bands, music, and speeches 51,347.01 95,048.35 146,395.36 Banners, booths, and signs 35.00 48,616.07 68,294.56 267. 72 117,213.35 Miscellaneous supplies 262. 76 388. 69" 90.07 9,892.19 8,440.52 7,210. 36 29,284.59 General plant service 035.46 1,215.44 168.91 36,084. 45 12,133. 52 1,416. 85 55,054.63 Total 162,868.11 61.732.68 41,138.07 912,571. 09 806,784.62 | 84,711.60 2,069,806.17 SCHEDULE 13.—Capital account reconciliation, Jan. 1 to Dec. 31, 1918. Capital paid in Jan. 1, 1918 $18,684,850 Sundry increases: Due to increase of capital and surplus of member banks $1,221,850 Due to organization of new national banks 1,350 Due to admission of State banks and trust companies 1,071,350 __ 2,294,550 20,979,400 Sundry decreases: Due to decrease in capital and surplus of member banks.. 300 Due to banks liquidated 174,000 Paid in capital Dec. 31, 1918 20,805,100 SCHEDULE 14.—Summary of Federal Reserve notes. Total issued to bank: 1914, 1915, 1916, 1917 $601,513,000 1918 589,400,000 1,190,913,000 Less notes unfit for circulation retired 1914, 1915, 1916, 1917 J $145,174,435 Less notes unfit for circulation retired 1918 226,722,730 371,897,165 Amount outstanding Dec. 31, 1918.. 819,015,835 As follows: In actual circulation 729,824,330 Held by Federal Reserve Bank Dec. 31, 1918. 89,191,505 819,015,835 On Dec. 31, 1918, the Federal Reserve agent held against Federal Reserve notes: Gold certificates 274,392,165.00 Commercial paper 774,918,088. 63 Total 1,049,310,253.63 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

394 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. SCHEDULE 15.—Total of Federal Reserve notes paid out by the Federal Reserve Bank of New York, by months, 191S. To member To nonmem banks. ber banks. January $41, 763,000 $3, 129,000 February 61, 278,000 2, 022,000 March..". 69, 386,000 2, 605,000 April 67, 543,000 2, 342,000 May 55, 262,000 1," 76,000 June 418,000 2, 983,000 July 92^ 593,000 1,4 13,000 August 89, 244,000 755,000 September 88, 573,000 1 019,000 October 86, 1.50,000 1,2 03,000 N De o c v e e m m b b e e r r 10 7 4 3 , , 6 1 2 8 7 5 , , 0 0 0 0 0 0 1 3 5 5 4 2 7 , , 0 0 0 0 0 0 2, 907,022,000 23,146,000 Total paid to nonmember banks 23,146,000 930,168,000 Total received from Federal Reserve agent 539,400,000 SCHEDULE 16.—Movement of Federal Reserve notes between Federal Reserve Bank of New York and other Federal Reserve Banks, Jan. 1 to Dec. SI, 1918. Notes of Federal Reserve From Federal Reserve Bank of— Bank of To Federal Reserve Bank of— New York received. Atlanta $6,165.750 Atlanta Boston 28,023,300 11,226,000 Chicago 9,517,450 Cleveland 2,989.850 Dallas 691,050 | Kansas City 1,001,300 Minneapolis 43,178,000 ' Philadelphia 9,742,900 Richmond 4,274,050 St. Louis 1,240,820 San Francisco Total 118,050,470 ! m $9,300,050 16,415,400 14,085,9,50 13.639,700 1,977,800 3,406,000 2,312,750 31,085,350 17,519,100 3,013,150 5,873,950 118,629,200 SCHEDULE 17.—Summary of gold settlement fund operations, Jan. 1 to Dec. SI, 1918. Amounts received and paid by the New York Federal Reserve Bank From or to Federal Reserve in settlement of accounts due. Bank of— Net gain. Net loss. R eeeived. Paid. Boston $2,053,341,793.38 $2,077,384,815.43 $24,043,022.05 Philadelphia 3,120,296,067.46 2,981,806; 142.38 $138,489,925.08 Cleveland 2,170,184,540.50 1,836,466,723.75 333,717,816.75 Richmond 1,221,227,2&3.37 1,364,498,260.70 143,270,977. 33 Atlanta 501,450,567.96 752,163,009.71 250,712,441.75 Chicago 2,700,218,462.26 3,248,800,605.65 548,582,143.39 St. Louis 791,185,425.53 582,125,736.40 209,059,689.07 Minneapolis 631,171,389.45 725,818,906.49 94,647,517.04 Kansas City 763,295,709.41 594.527,787.62 108,767,921.79 Dallas 433,858,198.13 448,527,571.69 14,669,373.56 San Francisco 1,180,968,773.34 1,071,180,195.15 109,788,578.19 172,000,000.00 101,000,000.00 71,000,000.00 Treasurer of United States 159,058,000.00 53,020,000.00 106,038,000.00 Total 10,498,256,210.79 16,437,319,755.03 1,136,801,930.88 1,075,925,475.12 Gain... 60,936,455.76 60,936,455.76 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT >70. 2—NEW YORK. 395 SCHEDULE 18.—Fiduciary powers granted national banks during 1918 in Second District, by Federal Reserve Board. Powers granted—Trustee, executor, administrator, registrar of stocks and bonds, guardian of estates, assignee, receiver, committee of estates of lunatics: Asbury Park, .N. J., Merchants National Bank. Morristown, N. J., National Iron Bank. Paterson, N. J., Second National Bank. Phillipsburg, N. J., Phillipsburg National Bank. Albany, N. Y., National Commercial Bank. Buffalo, N. Y., Manufacturers & Traders National Bank. Canandaigua, N. Y., Canandaigua National Bank. Canton, N. Y., St. Lawrence County National Bank. Catskill, N. Y., Catskill National Bank. Cooperstown, N. Y., Second National Bank. Dunkirk, N. Y., Lake Shore National Bank. Elmira, N. Y., Second National Bank. Geneva, N. Y., First National Bank. Glens Falls, N. Y., Merchants National Bank. Hudson, N. Y., First National Bank. Jamestown, N. Y., National Chautauqua County Bank. Lockport, N. Y., Niagara County National Bank. New York, N. Y., American Exchange National Bank. New York, N. Y., Atlantic National Bank. New York, N. Y., Chemical National Bank. New York, N. Y., Citizens National Bank. New York, N. Y., First National Bank. New York, N. Y., Hanover National Bank. New York, N. Y., Irving National Bank. New York, N. Y., Lincoln National Bank. New York, N. Y., Mechanics & Metals National Bank. New York, N. Y., National Park Bank. Nyack, N. Y., Nyack National Bank. Oneonta, N. Y., Citizens National Bank. Utica, N. Y., L^tica City National Bank. Watertown, N. Y., Watertown National Bank. Powers granted—Trustee, executor, administrator, registrar of: stocks and bonds, guardian of estates, receiver: Bridgeport, Conn., City National Bank. Powers granted—Trustee, executor, administrator, registrar of stocks and bonds, guardian of estates, assignee, receiver: Elmira, N. Y., Merchants National Bank. Powers granted—Trustee, executor, administrator, registrar of stocks and bonds, guardian of estates, receiver: Greenwich, Conn., Greenwich National Bank. Powers granted—Trustee, registrar of stocks and bonds: Frenchtown, N. J., Union National Bank. Powers granted—Registrar of stocks and bonds: Paterson, N. J., First National Bank. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

396 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. SCHEDULE 19.- -Honor roll of employees in the military or naval service of the United States. Name. Branch of service. Aiiken, Harold R Apr. C>, 1918 Marines. Anderson, Harry A May 10, 1918 Navy. Anderson, William C Mar. 9, 1918 Army. Bedell, Henry M Apr. 5, 1918 Naval Reserve. Behan, William F Mar. 1, 1918 Do. Berger, Harry A Aug. 15, 1918 Signal Corps. Black, Norman P Apr. 5, 1918 Army. Blackford, Eugene G Jan. 15, 1918 Do. Blackmail, Harry II., jr. Dec. 15, 1917 Do. Blumberg, Leo Sept. 21, 1918 Student Army Training Corps, Harvard. Bowen, Harold J Apr. 13, 1918 Navy. Brennan, Thomas S Apr. 23, 1918 Army. Byrne, Edmund J Apr. 12, 1918 Cameron, Donald J Aug. 31, 1918 Do. Carey, Jack H July 15, 1918 Canadian Royal Flying Corps. Carnahan, Robert S. Sept. 14, 1918 Student Army Training Corps, Columbia. Cokelet, William Van May 25, 1918 Army. Conover, William H , June 22, 1918 Do. Cook, James R July 19, 1918 Do. Curtis, Frank M Sept. 4, 1918 Do. Cuyler, Theodore L Dec. 15, 1917 Navy. Daekerman, Frank Aug. 9, 1918 Do. Dencker, Rudolph R Aug. 3, 1918 Signal Corps. Denny, Daniel May 24, 1918 Army. Donaldson, Guy Dec. 15, 1917 Navy. Doyle, Frank P July 20, 1918 Army. Drew, Earl May 1, 1918 Do. Dunn, John A Apr. 27, 1918 Do. Duvall, Steele Apr. 23, 1918 Do. Ehm, William A July 16, 1917 National Guard. E H J S J J H H H E F F G H H J J H F F F G G H O L K K F G G G G G K G F o a u e u t a e o e l u r r a l e r a a h a l i r u e a o l e e o u a a ' e a c e h d d a G m n i e l r l a r i n u l r e r n m y n v n i i r r g f d y n o c f t m r n n e f s g a u g n a d e f g m l l t f o s e r i r r , e n h h d e s b o i n e s , s a o e , i i s e s l n a i e a y o s i s n o l t o e r t a l e o r u E n c a , g a s e n t r n W , A h , , l l e d , t e n , i , n , s r , , n h t , n n , n s r a a , o J s g a s r , W H y , d t , F , , C T , , W r , , , , A o F d t n , , , G F i H , n r C , , M , t r d M G J l A J o , , s h h P W r , H F h D G i r A J W l e e l o W e o i R L e i l a w a o b a e e J o a d R l a o u C d r a l i n s p e s e o r l r n . a o n m m i c o e i r a o h r r i m e e e a i o i o t l h n r a h u l k l m h r t k k r W a b l l n e n h y p b p r r r m b g g i e a f t a g r l a , m e s d i k g n e u h A h i y u n s e e e r u c l e r W a j e r l r a r s J r t k r r l C t m e E Y L W A s s M A B K C F . C J . A ' A A J N J M N N M M M J N M J A D S D S S J J S S S J M J S J J A D O M O O u u u u u u u u u u e e e e e e e u u e e o o e u o c o u c c a a a a a a a n l l l l l l n n l p p p p p p p c c c t y g g y y g y v y t y v v y t g v y y y y r r r e . e e . . t t t t . . . t t t . . . . . . . . . . . . . . . . . . , 3 3 3 3 3 1 3 1 2 2 2 1 3 1 2 1 2 1 1 2 2 2 3 2 1 1 3 1 1 1 5 4 1 3 4 5 0 2 4 1 7 3 7 0 8 5 5 5 5 0 4 3 4 1 5 2 1 0 9 8 0 1 5 , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , . 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 9 9 9 9 9 9 9 9 9 9 9 9 9 9 9 9 9 9 9 9 9 9 9 9 9 9 9 9 9 9 9 9 9 9 9 9 9 9 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 7 7 7 7 8 8 8 7 8 8 7 8 8 8 8 8 8 8 8 8 7 8 8 8 8 8 8 8 8 8 8 8 8 8 8 8 8 8 N N A N A A N N A A A N A M A N N A N N M S R S S t t t a o a r r r a r a r r a a a r a a r r a e e u u u m m m m m m m m m v t v v v v v y v v v r r d d d i D D D D c c y D D D D D D a a v a y a y v o y y y y y y y y y y e e e h h l l l . l . . . . . n . . . . . o . o o o . o o o o o o . . n n n a a R R R F . . . . a . . . . . . t t t n n l l e e e A t t A A y s s s G i M M r r e e e r n m m u m r r r g a a v v v a y y y r r r e e e C i i d . . . n n T T T . o e e r r r r . . a a p a i i i s n n n . i i i n n n g g g C C C o o o r r r p p p s s s . . , St. John's, Klein, Ralph Mar. 26, 1918 Do! Kniffin, Frederick June 22, 1918 Do. Lackaye, George J July 10, 1918 Do. Langan, William, jr Apr. 30, 1918 Navy. Leger, Louis Wm July 27, 1918 Army. Leonard, William J Dec. 15, 1917 Navy. Lewis, Conrad B I^ewis, Donald J do... Do*. Lewis, Ernest E Sept. 1,1 918 Merchant Marine. Lord, Lyman C, jr May 23, 1918 Army. Lowell, Charles Nov. 21,1 917 Navy. 'MrCnrminlr flanrcra T TW 1 1Q17 Armv Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 2—NEW YORK. 397 SCHEDULE 19.— Jlmior roll of employees in the military or naval service of the United States—Continued. Entered serv Name. ice. Branch of service. Marcus, Warren, jr Dec. 10,1917 Do. Markert, Russell E Mar. 15,1918 Do. Mellor, Walter Nov. 30, 1917 Navv. Mcyran, George D., jr— Nov. 23,1917 Army. Miller, Edward A Apr. 30,1916 Do. Moore, W. B. J July 15,1917 National Guard. Muller, Carl Mar. 14,1918 Army. North, James C , June 15,1918 Navy. Pannick, Frank, jr Mar. 2,1918 Army. Peper, John L Sept. 15,1918 Student Army Training Corps, Columbia. Prescott, Harvey B Dec. 31,1917 Navy. Pronek, Lawrence J Oct. 24,1918 Army. Quirk, William A Sept. 21,1917 Do. Reinbrecht, Downing A. Dec. 1,1917 Do. Ross, Irwin G Sept. 30,1918 Do. Schultz, George W May 1917 Navy. Schwartz, Roland J Sept. 7,1918 Army. Scott, Joseph D June 3,1918 Navy. Seifert, Louis J Mav 23,1918 Armv. Senior, Charles, jr Sept. 15,1917 Do. Simpson, James L Feb. 27,1918 Do. Somers, Sutphen M June 2,1918 Naval Reserve. Stiess, Henry F May 21,1918 Armv. Suker, George Sept. 1,1918 Do. Tomkins, Edward J Nov. 24,1917 Do. Weaver, Luther O June 1916 Navy. Wiese, Rudolph E Dec. 15,1916 Army. Wightman, Walter H... May 15,1918 Marines. Wills, Ralph G Julv 27,1918 Navy. Winget, Clifford July 21,1917 New Jersey National Guard. Wise, John B Oct. 1,1918 Navy. Wonsor, Edward Dec. 28,1917 Do. York, Clarence S July 20,1918 Army. Two of those named above died in the performance of their duty. William Fraser Behan, a cadet flyer, in training at Bay Shore, Long Island, was killed in the fall of a hydroplane, and Luther Oberlin Weaver was among those lost with the United States patrol boat AlcedOj which was sunk by an enemy submarine. SCHEDULE 20.—Schedule showing when the proceeds of items tcill become available. Immediate credit: New York (Manhattan); when received by 9. a. m. One day after receipt: Boston. jBaltimore. Philadelphia. ^Pittsburgh. Richmond. Roanoke, Va. (see par list). Two days after receipt: Bants in- Cleveland, Connecticut, New Jersey. t Cincinnati. Delaware. *New York. Chicago. District of Columbia. "^Pennsylvania. fDetroit. Maine. Rhode Island. Atlanta. ^Maryland. Vermont. Minneapolis. ^Massachusetts. ^Virginia. St. Paul. New Hampshire. St. Louis. Kansas City, Mo. Kansas City, Kans. fLouisville. j Branch banks. * Except barks in cities referred to in first column. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

398 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD, Four days after receipt: Banks in- Dallas. Alabama. •Minnesota. fNew Orleans. Arkansas. Mississippi. fDenver. Florida. •Missouri. fOmaha. •Georgia. North Carolina. f Spokane. •Illinois. •Ohio. fSalt Lake City, Indiana. South Carolina. fPortland, Oreg. Iowa. Tennessee. fSeattle. •Kansas. West Virginia. San Francisco. •Kentucky. Wisconsin. •Michigan. Eight days after receipt: Banks in- Arizona. North Dakota. •California. Oklahoma. •Colorado. ^Oregon. Idalio. South Dakota. •Louisiana. •Texas. Montana. •Utah. •Nebraska. •Washington. Nevada. Wyoming. New Mexico. f Branch banks. " Except banks in cities referred to in first column. 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 Satur day on Wednesday. To obtain quickest availability of funds, sort and list checks in accordance with above time schedule, with a separate cash letter for each separate time group. Banks desiring to send checks direct to other Reserve Banks or their branches will please secure from us the circulars showing the territory handled by the branches. JUNE 1,1918. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 3—PHILADELPHIA. R. L. AUSTIN, Chairman and Federal Reserve Agent. INTRODUCTION. The report of the Federal Reserve Bank of Philadelphia for the year 1918 shows a great increase in operations over the previous year, and reflects the effect of the war on financial operations. The ease with which this district absorbed its allotments of the great Govern ment loans and financed the industries engaged in war work, was due to the greater availability of the credit resources of the country made effective through the Federal Reserve system. The banks of the district cooperated with the Government in its financing of the war to the fullest extent possible by loaning freely to subscribers to Liberty bonds, which they were able to do through the rediscounting facilities of the Federal Reserve Bank. RESULTS OF OPERATION. A comparative statement of the condition of the Federal Reserve Bank of Philadelphia is given in the appendix of this report (Schedule 1). The resources of the bank more than doubled during the year and are eight times greater than the figures for the close of 1916. On December 31, 1914, less than two months after the bank opened for business, the resources amounted to $21,501,000. Compared with December 31, 1917, figures at the end of 1918 indi cate an increase of $12,068,480 in the gold holdings and an increase of $144,544,990 in the amount of Federal Reserve notes in circulation. The work of gathering in the gold in circulation throughout the district, which had been begun in the previous year, was continued, and the increase noted above is due largely to this work. The paid-in capital increased $1,420,300 during the year. This was brought about principally by the admission of State banks and trust companies, having combined capital and surplus of $38,812,917. The item "Federal Reserve bank notes7' appears in the statement for the first time. Further reference to it is made hereinafter. Net earnings reached the large amount of $3,270,824, or 46 per cent on the average paid-in capital stock for the year. After payment of 399 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

400 ANNUAL REPOBT OF THE FEDERAL RESERVE BOARD. dividends of $366,383.14 covering the period from July 1, 1917, to June 30, 1918, and $216,825.56 covering the period from July 1, 1918, to December 31, 1918, there remained in the profit and loss account $2,608,343.91, one-half of which was placed to surplus account, the remainder, under the terms of the act, going to the Government as a franchise tax. Schedules 2, 3, and 4 show profit and loss statement, monthly statement of earnings and expenses, and chart of earnings and expenses. RESERVE POSITION. While deposit liabilities of the bank have remained fairly steady, liabilities for Federal Reserve notes have increased from $97,325,755 to $241,870,745. The percentage of reserve against combined liabilities fell from 68.7 at the beginning of the year to 44.6 at the close. The lowest £oint reached was 39.6 per cent on November 22. During November and December, owing to continued demands for funds and the consequent decline in reserve, the bank found it necessary to strengthen its reserve position by rediscounting with other Federal Reserve Banks. A chart showing the reserve position of the bank, and a table of its liabilities and reserve percentages, are given in the appendix of this report (Schedules 5 and 6). DISCOUNT RATES. The only changes in the discount rates during the year were made on April 8, when the 15-day rate for paper secured by Government obligations was increased from 3| to 4 per cent; the 16 to 90 day rate for such paper from 4 to 4} per cent; the 16 to 90 day rate for com mercial paper from 4J to 4f per cent; and the 16 to 90 day rate for trade acceptances from 4 to \\ per cent. It was considered inadvisable to increase further the discount rates, notwithstanding the heavy borrowings by member banks, resulting from the large subscriptions to Liberty bonds and United States certificates of indebtedness. Changes in discount rates during calendar ygar 1918. Rate in effect- Jan. 1, Apr. 8, Jan 1, 1918. 1918. 1919. Discounts maturing within 15 days, including member banks' collateral notes Paper, including member banks' collateral notes, secured by United States certificates of indebtedness, or Liberty loan bonds maturing within 15 days 4 Paper maturing within 16 to 90 days 4| Paper secured by United States certificates of indebtedness or Liberty loan bonds maturing within 16 to 90 days Agricultural and live-stock paper maturing after 90 days 5 Trade acceptances maturing from 1 to 15 days 4 Trade acceptances maturing from 16 to 90 days 4i Bankers' acceptances purchased at the market rate, subject to agreement. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 3—PHILADELPHIA. 401 INVESTMENTS. The discount facilities of the bank were used extensively, loans increasing continually throughout the year. Total operations, exclusive of purchases of Government securities, amounted to $1,977,660,746, of which 77 per cent represented paper secured by obligations of the Government. The largest amount of borrowing at any one period occurred in connection with the issue of the fourth Liberty loan, earning assets increasing from $118,694,530 on Sep tember 28, the opening date of the campaign, to $209,449,707 on December 3. There were practically no dealings in municipal warrants through out the year. Of the 660 member banks in the district, 457, located in 355 cities and towns, borrowed from the bank during the year. The heaviest transactions occurred on November 7, when total loan and invest ment operations amounted to $39,135,472. Total earnings from investments amounted to $4,230,955, compared with $987,057 the preceding year. The average rate of return from all classes of investments was 4.19 per cent, compared with 3.32 per cent in 1917, and 2.42 per cent in 1916. A chart showing discount operations, and tables showing total operations, aveiage holdings, earnings, and rate of earnings are given in the appendix of this report (Schedules 7 to 11). The maturities of the bank's earning assets on the last Friday of the year are shown in Schedule 12. It is difficult to estimate the probable time in which members can clear up all their " war paper" at the Reserve Bank. Not very much progress can be made until the Government has completed its war financing. If prior to the next bond issue considerable liquidation in business should take place, it would release funds for investment in United States certificates of indebtedness and possibly prevent material increase in the loans of the bank. In pursuance of the policy of banking institutions, loans not essential to the prosecution of the war were very largely curtailed, while loans for war purposes were greatly expanded, and it is the latter class of loans in which there is the possibility of considerable contraction owing to the ces sation of the war. In the meantime it should be the policy of the Federal Reserve Bank to use every effort to bring about as rapidly as possible the liquidation of war paper and at the same time do everything it can to encourage legitimate business by extending as far as possible necessary credit facilities. 100823°—19 26 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

402 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. BILLS DISCOUNTED —MEMBERS. Bills discoumted for members constituted the major part of the loan operations, tile amount of such discounts increasing throughout the year. The maximum loans in any one month were made in December, the total being $511,014,436. The nuimber of banks rediseounting commercial paper was rela tively small. Sy far the largest amount of borrowing was on notes secured by Government obligations, as this was more convenient, the rates of discount were' less, and much of the necessity for borrow ing arose out of the subscriptions to Government bonds and certifi cates of indebtedness. The amount of trade acceptances discounted was $5,650\O53, compared with $726,078 the preceding year. Many inquiries were received regarding the use of these acceptances, and an increasing number of concerns is employing them. The movement toward their use, however, has apparently not yet made marked progress in this district, although the advantages of their adoption are recog nized. Bills discounted during each month, distributed by classes of paper. For member banks. Total discounts. For other Federal G o S b o e l v c i u e g r r a e n t d i m on e b n y s. t c T e r p a t d a e n c a e c s ! AH other. R B e a s n e k rv s. e January $7,964,580 $118,747 117,655 $36,200,982 $565,122 February 20,683,066 120,612 064,700 31,868,368- 1,682,222 March. 11,439,160 957,654 020,113 29,416,927 3,009,293 April :. 30,063,101 762,997 556,490 42,3&2,588 2,385,421 May.. 65,890,797 355,851 720,246 $2,038,200 74,005,094 20,445,040 June 66,997,77L 451,466 376,674 1,934,745 94,760,656 42,724,903 July 77,023,763 513,811 928,502 134,466,076 22,175,858 August 110,986,997 557,442 721,623- 13,701,501 160,967,563 IS, 170,441 September 136,022,458 347,038 848,904 161,218,400 18,934,001 October 189,441,4?14 182,300 699,482. '" 6," 370," 6562" 21,693,196 16> 819,730 November 324,175,834 522,651 949,949 359,648,434 31,478,602 December 473,947,739 759,484 307,213 511,014,436 45,025,375 Total, 1918 1,504,636,670 5,650,053 323,311,551 24,044,446 1,857,642,720 Total, 1917 32,803,226 726,078 189,896,704 223,416,008 BANKERS ACCEPTANCES. Bankers' acceptances purchased amount to $120,008,026, com pared with $85,913,796 the preceding year. Most of the bills were purchased for our account by the Federal Reserve Bank of New York. As yet there is no real market for bankers' bills in Philadelphia outside of the Federal Reserve Bank, and until the present urgent demand for money subsides and the banks have funds for investment in such paper it will be hard to establish one. It is hoped that ultimatelv such a market will be established and that all banks will Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

BISTBIGT HO. 3—PHILADELPHIA. 403 liquidity and at the same time further the development of inter national commerce and banking. This bank has purchased from its members all bills offered by them, and has at times made large purchases in the New York market when bills of the banks in this district were offered there. Acceptances bought in the open market and from other Federal Reserve Banks. Open-market purchases. Total. Purchases from other B c a e n p k t e a r n s c * e a s. c c T e r p a t d a e n c a e c s . s F e e rv d e e r b al a n R k e s . 1918 1917 January $4,893,266 $274,572 15,167,838 $2,107 327 February 4,153,683 $5,017,518 9,171,201 10,058,886 March 5,561,666 9,000 7,558,697 13,129,363 4,610,296 April... 6,743,065 79,005 3,999,257 10,821,327 5,268,807 May 8,434,297 2,985,450 11,419,747 5,404,559 June... 7,120,876 652,719 7,773,595 3,441,475 July 5,748,048 5,748,048 11,472,425 August 3,080,170 1,352.500 4,432,670 7.450,793 September 2,741,791 2,741,791 6; 056,282 October 20,593,547 25,000 10,358;157 30,976,704 4,565,180 November 6,869,061 24,139 10,397,406 17,290, 606 19,479,626 JXecember 1,314,610 20,526 1,335,136 5,998,140 Total, 1918 77,254,080 432,242 42,321,704 120,008,026 Total, 1917 83,976,401 1,937,395 85,913,796 FEDERAL RESERVE NOTES. Federal Reserve notes supplied satisfactorily the currency needs of the community. The establishment throughout the district of large shipyards and munitions plants necessitated huge pay rolls and demands for currency were incessant. Notes of the denomination of $20 were especially in demand and seemed to disappear from circu lation. The bank has rendered a distinct service to its members in the matter of furnishing currency, which had formerly been done by the Sub treasury, The amount of money shipped to the bank by members and nonmembers averaged $1,750,000 daily and required the services of 30 employees to assort and count it. Federal Reserve notes outstanding reached the high mark of $243,142,700 on December 26. The act now provides for the issue of Federal Reserve notes in the denominations of $500, $1,000, $5,000, and $10,000, but so far none have been issued. The re quired gold reserve of 40 per cent against Federal Reserve notes in actual circulation was maintained throughout the year. Schedules 13 to 16 give a comparative statement of condition of the Federal Reserve agent's accounts, notes in circulation, denomi nations issued, notes outstanding at close of each month, and interdistrict movement of notes. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

404 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. FEDERAL RESERVE BANK NOTES. The Pittman bill, which became law on April 23, 1918, provided for the issuance of Federal Reserve bank notes of the denominations of $1 and $2. These notes took the place of silver certificates, which were retired from circulation, and the coin securing them, was melted down and disposed of as bullion. At the close of the year, $8,926,163 of these notes were in actual circulation. These were secured by $825,000 one-year Treasury notes, and $8,855,000 United States certificates of indebtedness deposited with the Treasurer of the United States. As the purpose of issuing Federal Reserve bank notes was their substitution for silver certificates in order that the silver might be used in supplying the urgent demand for silver bullion, efforts were made to obtain all the silver certificates possible, and a considerable amount of such certificates was shipped through this bank for can cellation. Tables showing denominations issued and amount outstanding at end of each month are given in Schedules 17 and 18. INTERNAL MANAGEMENT OF THE BANK. OFFICERS AND DIRECTORS. Richard L. Austin, Chairman and Federal Reserve Agent; Henry B. Thompson, Deputy Chairman; E. Pusey Passmore, Governor; Edwin S. Stuart, Deputy Governor; William H. Hiitt, Deputy Governor. Class. Name. Residence. Term expires. f Group 1... Joseph Wayne, jr., president Girard National Bank, Philadelphia, Pa Dec. 31,1920 Philadelphia, Pa. A -[Group 2... Francis Douglas, cashier First National Bank, Wilkes-Barre, Pa Dec. 31,1921 Wilkes-Barre, Pa. lGroup3... M. J. Murphy, c/o A. B. Leach & Co., hankers, New Clarks Green, Pa. Dec. 31,1919 York City. [Group 1... Alba B. Johnson, president Baldwin Locomotive Rosemont, Pa Do. Works, Philadelphia, Pa. B ] Group 2... Edwin S. Stuart, merchant, Philadelphia, Pa Philadelphia, Pa Dec. 31,1920 (Group 3... Charles K. Haddon, vice president Victor Talking Camden, N. J Dec. 31,1921 Machine Co., Camden, N. J. [Richard L. Austin Philadelphia, Pa Dec. 31,1920 1 Henry B.Thompson,president U. S. Finishing Co., Dec. 31,1919 C 1 New York City. [Charles C. Harrison Philadelphia, Pa Dec. 31,1921 Mr. Levi L. Rue, president of the Philadelphia National Bank, was reelected a member of the Federal Advisory Council to represent the Third Federal Reserve District for the year 1918. Mr. Charles J. Rhoads, who had been governor since the organiza tion of the bank, resigned on February 8, 1918, to undertake war work with the Y. M. C. A. The following minute relative to his withdrawal was adopted by the board of directors: The directors of the Federal Reserve Bank of Philadelphia desire to record their appreciation of the services rendered this bank by Mr. Rhoads as its governor, since organization, and the great reluctance with which they have accepted his resignation. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT HO. 3—PHILADELPHIA. 405 In their judgment, no one could have filled the office more capably than he has filled it, or have secured for the Federal Reserve system greater support, cooperation and confidence on the part of the banks and trust companies in this district. Since his resignation was presented on December 19, 1917, the directors have hoped that he might be induced to withdraw it. His decision, however, has been unalterable. His purpose in resigning to devote his abilities to the humanitarian work incident to the war deserves the particular admiration of all who know those abilities, as the directors of this bank have learned to know them. While regretting the termination of Mr. Rhoads's association with this bank, the directors appreciate the serious conviction and sense of duty which led to his resignation. They also recognize what he will contribute to the work upon which he enters, needing as it does just such ability, character, and purposes as Mr. Rhoads will bring to it. Mr. E. Pusey Passmore, then vice president of the Franklin Na tional Bank, Philadelphia, was elected to succeed Mr. Khoads, on February 8, 1918. Mr. Frank M. Hardt, deputy governor and cashier of the bank, resigned on June 30, to accept the position of vice presi dent and treasurer of the Philadelphia Trust Co. Upon motion duly made and seconded, a minute reading in part as follows was unani mously adopted by the board of directors: It is the desire of the board that this record be made of the regret with which Mr. Hardt's resignation has been accepted and of the appreciation with which his valuable services will be remembered. Absolutely unsparing of self, the bank's interests were at all times foremost with him. To its organization, its accomplishment, its service to its members and to the Nation, he has constantly given his every effort, and all have borne the mark of rare ability. Mr. William A. Dyer, then vice president and treasurer of the Cam bridge Trust Co., Chester, Pa., a member of the Reserve system, was elected cashier on May 29, 1918. The office of deputy governor being vacant, Mr. William II. Hutt, treasurer of the University of Pennsyl vania, was elected to the position on May 29, 1918. Mr. James M. Toy, an employee of the bank, was elected an assistant cashier on May 29, 1918. A vacancy in the board of directors was caused by the death on September 24, 1918, of Hon. George W. F. Gaunt, a class B director, whose term would have expired on December 31, 1918. A minute reading in part as follows was adopted by the board of directors on October 2, 1918: The directors of the Federal Reserve Bank of Philadelphia have learned with sorrow of the death on September 24, 1918, of George W. F. Gaunt, a director of this bank since its organization. His fellow directors have decided by this minute to express their admiration of his useful and honored life, as well as their appreciation of the service he has rendered this institution. They also desire to express their deep sympathy for his family. Mr. Charles K. Haddon, of Camden, N. J., was elected by group 3 banks to succeed Mr. Gaunt. Mr. William H. Peck, president of the Third National Bank, Scranton, Pa., a class A director, whose term Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

406 ANNUAL REPORT Off THE FEDERAL RESERVE BOARD, an amendment to the Federal Reserve Act. Mr Peck was one of the original directors of the bank. Mr. Francis Douglas, of Wilkes-Barre, Pa., was elected by group 2 banks to succeed Mr. Peck. The results of the regular election for a class A and a class B director, held from November IS to December 3, are shown in Schedule 19. At the end of 1917 the bank had 6 officers and 186 clerks and other employees, compared with 11 officers and 419 clerks and other em ployees at the end of 1918. Number Number Departments. p o lo f y e e m e s, Departments. p o lo f y em ee s, 1918. 1918. BANK. BANK. Officers Telegraph 3 Analysis. Telephone 3 Auditing Transit 103 Bookkeeping Vault custodian 3 Building (porters, charwomen, etc.) Chauffeurs 335 Coupon Discount GOVERNMENT, Examination Federal Reserve agent Liberty loan 48 Filing Government depositary... 25 Mail. Government eneck " 11 Miscellaneous Liberty loan statistics 5 Money Liberty loan committee... 3 Pages Capital Issues Committee. 3 Printing Runners and guards 95 Secretaries The bank secured early in the year the building at 925 Chestnut Street, formerly occupied by the Penn Mutual Life Insurance Co. The building is centrally located and is very near the city's main post office. DEPARTMENT OF EXAMINATION. The large increase in the number of State bank and trust company members made it necessary to arrange for keeping informed about them and to provide for such examinations and inspections as might be necessary. Mr. W. W. Paddock, a national-bank examiner in this district, was engaged as Federal Reserve examiner and put in charge of this work. On August 15 he resigned to accept a position as bank examiner for the Federal Reserve Board, and Mr. Walter T. Grosscup, a bank examiner under the Commissioner of Banking of New Jersey, was engaged to fill the position. COLLECTION DEPARTMENT. For several months after the institution of the collection depart ment, the greater portion of its business was received from other Federal Reserve Banks. At the present time only a comparatively Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 3 PHILADELPHIA. 407 cents an item was discontinued on July 1, 1918, and while this bank does not now make any charge for its service, items are sometimes subject to charges made by the collecting banks. The number of items handled is given herewith: Items Number Number received. paid. returned. 1918, January 248 7 February 244 217 27 March 322 290 32 April 413 354 59 May 385 324 61 June 725 609 116 July 1,090 946 144 August 1,637 1,487 150 September 2,190 1,992 198 October 1,148 891 257 November 1,096 903 193 December 1,356 1,156 200 Total 10,861 9,417 1, 444 COUPON DEPARTMENT. The paying and handling of coupons representing interest on the various issues of Liberty bonds involved a large amount of work, and a special department was organized for this purpose, in which there are five clerks. This force had to be considerably augmented, however, at interest-paying periods. The number and amount of coupons handled are given herewith: Number, j Amount I January.. $260,907 February. 170. 53,536 March.. 19,640 April 36,977 May 437, 2, 411,898 June 260, 1,298,396 July 228, 410,094 August 87! 160,573 September.. 240; 1,184,568 October 527! 1,496,681 November.. 201; 1,534,622 December... 2, 220,509 430. Total.. 2, 728,361 11,735,022 CLEARING DEPARTMENT. Figures showing transactions through the gold settlement fund and operations of the check-collection department of this bank are given in Schedules 20 and 21. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

408 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD, GENERAL BANKING CONDITIONS IN DISTRICT AND RELATIONS WITH; MEMBER BANKS. There has been no change in the boundary lines of the Third Federal Reserve District, the territory comprised being as follows: Delaware (population 215,160). New Jersey, southern part (population 652,499), counties: Atlantic. Cape May. Mercer. Burlington. Cumberland. Ocean. Camden. Gloucester. Salem. Pennsylvania, eastern part (population 5,764,952), counties: Adams. Delaware. Montour. Bedford. Elk. Northampton. Berks. Franklin. Northumb erland. Blair. Fulton. Perry. Bradford. Huntingdon. Philadelphia. Bucks. Juniata. Pike. Cambria. Lackawanna. Potter. Cameron. Lancaster. Schuylkill. Carbon. Lebanon Snyder. Center. Lehigh. Sullivan. Chester. Luzerne. Susquehanna. Clearfield. Lycoming. Tioga. Clinton. McKean. Union. Columbia. Mifflin. Wayne. Cumberland. Monroe. Wyoming. Dauphin. Montgomery. York. The banking resources of national banks in the district increased 8 per cent during the year, and State institutions 14 per cent, making an increase in the combined banking resources of 10 per cent. The figures are given in Schedules 22 and 23. There were 628 national bank members at the beginning of the year; 5 went into liquidation, and 8 new banks were organized, making 631 national bank members at the end of the year. There were 7 State bank members at the beginning of the year; 22 new institutions were admitted, making 29 State bank members at the end of the year, and the total number of member banks 660. While the number of State institutions in the district which have already joined the Federal Reserve system is 29 out of 259 eligible institutions, yet those which were members at the end of the year represented 54 per cent of the resources of all eligible State institu tions. Among the trust companies and State banks which have joined the system are included the largest in Philadelphia and in some other parts of the district. While applications for membership are coming in slowly, bankers seem to appreciate the advantages of membership, and there is every reason to hope that most of the institutions will eventually come in. Such State institutions as have become members have availed them- Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 3—PHILADELPHIA. 409 selves freely of the discount facilities of the bank. Our relations have been materially profitable and helpful; members speak with satisfaction of the results and have been of much assistance in obtaining new members. The banking departments of the States in the district have sent us, upon request, copies of reports of examinations of State bank mem bers, which rendered it unnecessary to have special examinations made by our own examiners. One of the effects of trust companies joining the system has been somewhat of a change in the investments of such companies. A number of them now carry lines of paper eligible for rediscount at the Federal Keserve Bank, making their assets, to that extent, more liquid than heretofore. The list of State institutions which are now members is given in Schedule 24. The first seven joined in 1917. In the fall of the year 95 per cent of total borrowings by member banks represented borrowings from the Federal Reserve Bank. Prior to June, 1917, when the first Liberty loan was issued, the bulk of the loans had been made with correspondent banks. The banks of the district have always been conservative, and their borrowings usually small, but during the past year they subscribed liberally to Liberty bonds and United States certificates of indebtedness, which necessitated a great increase in the amount of their borrowings. This, however, was less than anticipated, as early in the war the necessity for conserving capital and credit was appreciated and the policy of curtailment of credit for purposes not essential to the prose cution of the war was undertaken and generally maintained through out the district. Holdings of Liberty bonds by national banks of the district on September 11, 1917, amounted to $23,903,000; on December 31, 1917, |48,066,000; on June 29, 1918, $64,071,000; and on November 1, 1918, $152,007,000. As the Government was constantly in the market for funds money rates were high throughout the year, 6 per cent being the prevailing rate for paper. The banks bought comparatively little. Transac tions in municipal, industrial, railroad, and public-utility securities were also at a minimum owing to restrictions on credit and the diversion of funds to investment in Government bonds. At the time of the influenza epidemic the staffs of banking institu tions, in common with other business concerns, were in some cases so seriously affected that the operations of the banks could not be car ried on without outside help. Upon the request of several institu tions, this bank furnished them clerks from its staff which enabled such banks to carry on their operations. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

410 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. ACCEPTANCES UP TO 100 PER CENT. During the year the Bank of North America and the First National Bank, both of Philadelphia, were authorized to accept drafts up to 100 per cent of their capital and surplus. The increase in acceptance liabilities of member banks is given herewith: Date of comptroller's call. Amount. Dec. 31,1915 $2,809,000 Dec. 27,1916 8)309,000 Dec. 31,1917 14,165,000 Nov. 1,1918 25,683,00a1 PHILADELPHIA CLEARING HOUSE MEMBERS. In the latter part of the year the ratio of loans to deposits of the Philadelphia Clearing House was above 100 per cent. The relation of loans to deposits is shown in Schedule 25. FIDUCIARY POWERS GRANTED. The applications of the following banks for fiduciary powers in accordance with section 11 (k) of the Federal Reserve Act as origi nally enacted were approved in 1918: Atglen National Bank, Atglen, Pa. National Bank of Boyertown, Boyertown, Pa. First National Bank, Danville, Pa. Conestoga National Bank, Lancaster, Pa. South Bethlehem National Bank, South Bethlehem, Pa. Wyoming National Bank, Wilkes-Barre, Pa. National Bank of Topton, Topton, Pa. First National Bank, Williamsport, Pa. Western National Bank, York, Pa. The Phelan amendment to the Federal Reserve Act, which became law on September 26, 1918, in addition to authorizing the Federal Reserve Board to permit banks to act as trustee, executor, adhninistrator, and registrar of stocks and bonds, also permitted the granting of the right to act as guardian of estates, assignee, receiver, committee of estates of lunatics, or in any other fiduciary capacity in which State banks, trust companies, or other corporations which come into competition with national banks are permitted to act under the laws of the State in which the national bank is located. No permit can be issued to any national banking association having a capital and surplus less than the capital and surplus required by State law of State banks, trust companies, and corporations exercising such powers. The minimum capital required for institutions exercising fiduciary powers in Pennsylvania is $125,000; in New Jersey, $400,000; in Delaware, $25,000. By capital is meant the amount actually credited to capital and takes no account of surplus. The applications of many institutions which desired authority to exercise fiduciary Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 3—PHILADELPHIA. 411 powers could not be approved owing to their not having sufficient capital. The following institutions were granted these powers under the new act: Merchants National Bank, Allentown, Pa. Third National Bank, Scranton, Pa. South Bethlehem National Bank, South Bethlehem, Pa. Swedesboro National Bank, Swedesboro, N. J. First National Bank, Williamsport, Pa. First National Bank, Woodbury, N. J. Western National Bank, York, Pa. CLAYTON ACT. Only a few applications for permission to serve as director under the terms of the Clayton Act and Kern amendment were received during the }^ear, the bulk of such applications having been made in the fall of 1916. FISCAL AGENCY OF THE UNITED STATES. The Federal Reserve Bank has been brought prominently before the public through its activities as fiscal agent of the Government in the placing of the Liberty bonds and certificates of indebtedness. There has been a realization of the importance of the system through the comparative ease of the money market that was maintained dur ing the war and the facility with which the financial transactions of the Government were carried through. Schedule 26 shows subscriptions to the four Liberty loan issues. LIBERTY LOANS. Two campaigns for the sale of Liberty bonds were conducted dur ing the year, and from the standpoint of distribution the third Lib erty loan campaign was by far the most successful, 1,870,928 sub scribers having been obtained. It should be said, however, that the Work of the fourth Liberty loan was hampered very much by the influenza epidemic, which was at its height during the campaign. At one time more than half the loan workers were ill, or else occupied in nursing the sick; also theaters, churches, schools, etc., were closed and it was found necessary in soliciting subscriptions for the fourth loan to appeal for large subscriptions rather than a great number of subscribers. Previous to the opening of these campaigns the work of the organ ization of the various committees had been completed, a conference was held of the secretaries of all the districts into which the Phila delphia Federal Keserve District had been divided and opportunity afforded to familiarize themselves with the details of the loan and the work they were about to undertake. The intensive work of the campaigns was begun on the first day. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

412 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. , One of the objectives of the campaigns was the obtaining of small subscriptions and this was greatly facilitated by the cooperation of banks in agreeing to take subscriptions for bonds to be paid in installments at the rate of $1 a week for $50 bonds and proportion ately larger amounts based upon the denomination of the bonds sub scribed for. Subscriptions placed under these conditions involved the banks in a great amount of work and much expense. A committee that played a large part in making the campaigns a success was that having charge of all publicity matters for the dis trict. It forwarded to all organizations and subcommittees posters, buttons, etc., for use in the campaigns and attended to all the news paper advertising, etc. In connection with this committee a press bureau was established, which kept in touch with the newspapers of the district, and through the hearty cooperation of the papers a large amount of space was allotted in them for news incident to the campaigns. As no funds could be provided out of the proceeds of the sale of bonds for advertising purposes, all newspaper advertis ing for the campaigns was contributed by manufacturers, merchants, banking institutions, insurance companies, and other corporations of the district. The cost of such advertising was very large and the country is under great obligation to those who contributed so gener ously for this purpose. - In addition to the newspaper publicity, two innovations of marked value were adopted before the opening of the third campaign. A replica of Bartholdi's Statue of Liberty was erected on Broad Street, Philadelphia, immediately south of the city hall, at which, almost continuously, night and day, during the entire period of the third campaign, there was public speaking, band concerts, and other demonstrations, which created a spirit of enthusiasm and gave encouragement to the workers. During the fourth campaign, owing to the influenza epidemic, public assemblages were forbidden, con sequently no meetings were held around the statue. From the bal cony of this statue the Secretary of the Treasury, Hon. W. G. McAdoo, delivered an address on April 6, at the opening of the third campaign. Another feature which was very helpful was the publication of the "Liberty Line," a journal issued weekly by the committee, through which every worker was informed as to the operation of the campaigns and the methods being used by the various organiza tions and committees to promote the work. The encouragement and help given by these suggestions and advice was instructive and stimulating. In the emergency during the fourth liberty loan campaign caused by the epidemic the Boy Scouts were called upon and rendered inval uable service, temporarily performing many of the duties of the reg ular workers. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTKICT NX). 3—PHILADELPHIA. 413 Special reference should be made of the work of the industrial committee for the city of Philadelphia, which secured $78,000,000 subscriptions to the third and $164,000,000 to the fourth loans. The industries of the city were divided into 19 groups, 136 trade com mittees being organized to work in these groups, and 1,800 workers enrolled. The committee issued a daily bulletin, stating the progress made. In this district, whose population contains a large percentage of foreign born, the foreign-language division had an important part to play. It urged "Americanization"—the speaking of the American language, adopton of American customs, and, above all, the owning of Liberty bonds. The executive secretary spoke in eight different languages throughout the district. The response was spontaneous from all nationalities and an interesting feature of the canvas was that the German-Americans made the best showing of all in the city of Philadelphia, with over twenty millions of bonds to their credit in the fourth loan out of a total foreign sale of thirty-three millions. In the Philadelphia Federal Keserve District, as elsewhere, the services of the women were invaluable in the loan campaigns. In the third campaign their organization was on State lines, and did not cooperate so closely with the Liberty loan committee, but in the fourth campaign their organization was coextensive with that of the central Liberty loan committee of the district. They took an important part in the house-to-house canvass throughout the city, made public addresses, visited schools, and maintained booths in the streets of the cities and towns of the district, at which subscrip tions were received. Their organization was well carried out, and, if possible, more completely marshaled than that of the men. UNITED STATES CERTIFICATES OP INDEBTEDNESS. About 7 per cent of each issue of United States certificates of in debtedness was allotted to this district, the allotments being placed with the banks of the district in amounts proportionate to their resources. Previous to the third Liberty loan this work was per formed by the officers of the bank, but as the amount of the issues increased they were unable to continue it and the matter was placed in the hands of Mr. John H. Mason, of Philadelphia, as director of sales. The district has oversubscribed its quota for almost every issue. In connection with these operations, 647 of the banks availed them selves of the opportunity to become depositaries of United States loan funds, as a result of which the payments made for the purchase of certificates were withdrawn gradually from the banks, thus making the purchase of certificates by the banks much more facile. The results of the subscriptions are given in Schedule 27. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

414 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. CAPITAL ISSUES COMMITTEE. Early in the year the Capital Issues Committee appointed sub committees at each of the Federal Reserve Banks. The chairman of the board of directors of each Federal Reserve Bank acted as chair man of the subcommittee, and the governor of the Federal Reserve Bank as vice chairman. Richard L. Austin, chairman, appointed the following committee for the Philadelphia Federal Reserve district: E. P. Passmore, vice chairman; Clarence M. Clark, John Gribbel, Albert A. Jackson, Lewis Lillie, Howard S. Graham, Robert W. Daniels, Charles Fearon, George H. Frazier, A. C. Dinkey, Thomas S. Gates, Charles C. Harrison, jr., Walter C. Janney, Horatio G. Lloyd, W. S. Maddox, John S. Newbold, F. B. Snyder, Ira Vaughn, Joseph Wayne, jr., and Charles W. Welsh, all of Philadelphia; John Brooks, Scranton, Pa.; Benjamin E. Mann, Lancaster, Pa.; George K. Reilly, Harrisburg, Pa.; Fer dinand, W. Roebling, jr., Trenton, N. J.; H. B. Schooley, Wilkes- Barre, Pa.; and L. Scott Townsend, Wilmington, Del. A good deal of educational work was necessary to bring this matter to the attention of bankers and the general public. Notices were given to the press for publication in all the newspapers of the district. Communications reflecting the policy of the Government and stating in detail the procedure which should be followed by those interested in issuing securities were sent to all bankers, corporations, and munici palities interested in the issue of securities, and the necessary staff was provided to take care of the work. Ninety-three thousand copies of a pamphlet entitled "Economy the Gospel in England" were dis tributed. For some months the work of the committee continued on a purely voluntary or unofficial basis. On April 5, 1918, however, the War Finance Corporation Act was approved and under it district com mittees were reappointed in each Federal Reserve district throughout the country, all new issues of securities being submitted to and passed upon by the district committee in whose district the issues originated and then referred to the Washington committee for final action. In order that the work of the district committee might be carried out in the most expeditious and effective manner, a permanent executive committee, a secretary, and an assistant secretary were appointed. The executive committee consisted of: Richard L. Aus tin, chairman; E. P. Passmore, vice chairman; Clarence M. Clark, Howard S. Graham, John Gribbel, Albert A. Jackson, and Lewis Lillie. Other members of the main committee were called in rotation for a period of 60 days to serve with the executive committee, and Messrs. Charles W. Welsh, Charles Fearon, John S. Newbold, and y Joseph Wayne, jr., gave their assistance in this manner. Arthur E. Post, assistant Federal Reserve agent, was named as secretary of the Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO, 3 PHILADELPHIA. 415 committee, and Edward V. Kane, of the firm of Edward V. Kane & Co., was appointed assistant secretary. The capital issues committee of this district passed upon 182 applica tions, approximating $139,830,339. Of these, 149 applications, approximating $98,888,649, were approved, while 22 applications, approximating $40,941,690, were disapproved. In the cas« of 11 applications, securities aggregating $10,215,000 were tied up, under agreement not to be sold during the period of the war. Aside from those officially disapproved, prospective issues approximating $75,- 000,000, which would serve no military or economic purpose, were, in response to the committee's arguments, discouraged and post poned. While it was not part of the committee's duty to pass upon the merits of any issue of securities, its functions being confined to the question of timeliness as applied to the Government's war needs,, the large and increasing number of doubtful issues of miscellaneous stocks pertinently suggests the desirability of continued Federal supervision, with a view to the protection of the public from reckless and unscrupulous promoters. Supervision and restraint, with penalty-enforcing power, are especially important in view of the persistent efforts of promoters to exchange their shares for Liberty bonds. The effect of this business upon the market price of Gov ernment issues is obvious, since the latter are promptly converted into cash as soon as an exchange has been effected. Simultaneously with the closing of the work of the Capital Issues Committee at the end of the year, Chairman Hamlin, of the main committee at Washington, addressed a letter to the chairman of the committee for this district, reading in part as follows: As we approach the end of our work, it is the sincere wish of the committee and myself that you and the other members of the Philadelphia district committee may realize how grateful we are for the splendid patriotic cooperation you have given us. We all know that the idea back of the Capital Issues Committee would have had little effect without the help of the district committees, which have shown themselves to be composed of the most intelligent, loyal, and unselfish men that could be gathered together in the service of the Government. The district committeemen scattered throughout the country, and not we here in Washington, have been the bulwark of the committee. We know it and appreciate it and the success of the control of capital issues is due very largely to the efforts of yourself and your associates. The work throughout has been arduous, difficult, and to a large degree thankless, but we are assured by the Treasury Department that it has been of tremendous value, and every member of your committee has a right to be proud of his part in it. BUSINESS CONDITIONS IN THE DISTRICT. The large number of plants for the manufacture of iron and steel and all their products in this district made it naturally one of the most important centers for the production of munitions of war. The largest plants for the manufacture of guns and small arms are Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

416 ANNUAL KEPORT OF THE FEDERAL RESERVE BOARD. located here, including the several plants of the Baldwin Locomotive Works, Midvale Steel & Ordnance Co., Bethlehem Steel Co., numbers of steel-casting plants, and the great shipyards along the Delaware River. There was no unemployment in the district throughout the year. All lines of industry were hampered by the scarcity of labor, this scarcity being aggravated by reductions in the number of workers through enlistments and draft calls. Wage earners were attracted to munitions factories, shipyards, and other war plants by the high wages paid. The competition for labor and the steadily increasing wages resulted in much shifting of labor and consequent inefficiency. The employment of women in new lines of work did much to relieve the labor scarcity. After the signing of the armistice many plants either closed down or reduced operations, and in so doing released thousands of workers. This, in connection with the return of some thousands more from military service, improved the labor situation greatly, but as yet there appears to be no surplus of labor. Old shipyards were greatly enlarged and extended, new ones created, and the industrial area along the Delaware River witnessed an almost unthinkable expansion in shipbuilding. The Emergency Fleet Corporation let contracts to 11 yards in the district for the delivery of 3,442,577 dead-weight tons, equivalent to one-fourth of the tonnage provided for in the national shipbuilding program. Ten of the yards are manufacturing steel ships and have received contracts from the Fleet Corporation for a total of 412 ships, with an aggregate tonnage of 3,407,577. They employ very nearly 100,000 persons, the majority of whom are skilled workers. Up to November 30, 1918, the number of vessels delivered and launched was 79, of an aggregate tonnage of 523,442. Ninety-four ships of 765,120 total tonnage were in process of construction. The other shipyard is for the construction of wooden ships and has received awards for 10 wooden steamers of 3,500 dead-weight tons each. The total value of the above contracts is $689,390,000. The war's demands threw an immense amount of work upon the textile machinery of the district, the orders.placed for underwear, hosiery, other knit goods, and material for clothing being sufficient to absorb all the productive capacity of the mills. At times, every loom in the district was employed in making cloth for the Govern ment. While operations were much embarrassed by the shortage of labor and by difficulties in obtaining supplies, yet large quantities of goods were produced. Building operations, apart from those incident to war work, were the smallest on record for years. Inability to secure financial accommodation and the high cost and scarcity of materials and labor brought building for strictly civilian purposes almost to a Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 3—PHILADELPHIA. 417 standstill. Builders regard the prospect for active operations as good and are anticipating a better supply of labor and lower prices for materials following the curtailment of Government operations. The coal output of the district has, for the most part, been in excess of the two previous years. The severe shortage, due to scarcity of cars and other transportation difficulties, which was so disastrous last winter, has been avoided this winter. While a heavy loss in production was occasioned by the influenza epidemic, the situation at the end of the year showed considerable improvement, it being apparent that all requirements for fuel could be supplied. The production of anthracite coal for 1918 amounted to 88,840,000 tons, indicating but little change from the high figures of the im mediately preceding year. Reports of the production of bituminous coal indicate an increase for the year of about 18 per cent. The year 1918 has been successful for the farmers in the district. There was no unusual damage from frost or storm, the greatest damage being caused by a prolonged drought during part of the summer, which hurt particularly the potato crop. The estimated total acreage of the nine principal crops in Pennsyl vania was 8,379,054 tons, an increase of 320,219 over 1917. The estimated total value of these crops was $377,000,000, which is $25,000,000 more than 1917. The tobacco production was 58,000,000 pounds, an increase of 14 per cent over the preceding year. The aver age price was 25 cents per pound, compared with 22 cents last year. At the close of the year, the condition of wheat in the ground was 111 per cent, compared with 91 per cent a year ago, while that of rye was 109 per cent, 17 per cent more than the preceding year. The truck farmers in New Jersey had generally good crops. The tomato crop was very good, but the berry crop was short, in some places being only 25 per cent of normal. The hay and rye crops were unusually large. In Delaware, pasturage, hay, and dairying were about normal in production, but above normal in profit. The apple crop was 50 per cent above the 10-year average. The peach crop, which was only half the normal one, was worth $1,000,000. There were normal crops of tomatoes and other vegetables, with prices 50 per cent higher than prewar figures. BANK CLEARINGS. Bank clearings in the district for the year reached the high est level ever recorded,, the maximum for any one month being $2,003,307,000, during October. Schedule 28 shows comparative volume of clearings for each month, 1915-1918. 100823°—10 27 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

418 ASTXUAL REPORT OF THE FEDERAL RESERVE BOARD. Clearings in the third district. Per cent District out increase or 1918 Philadelphia. side of Total for district. decrease Philadelphia. compared with 1917. Januarv $1,522,827,616 $98,170,474 $1,620,998,090 + 8 February 1,223.305,964 81,216,156 1,304,522,120 - 2 1,427,175,557 101,811,793 1,528,987,350 - 2 1,579,825,000 120,777,000 1,700,602,000 + 13 Mav 1,711,945,000 111,232,000 1,823,177,000 + 16 1,700,306,000 107,643,000 1,807,949,000 + 12 July 1,765,812,000 115,622,000 1,881,434,000 +31 1,734,633,000 107,676,000 1,842,314,000 +26 1,610,611,000 104,638,000 1,715,249,000 +20 1,886,419,000 116,888,000 2,003,307,000 + 19 November 1,781,704,327 103,117,922 1,884,822,249 + 15 1,772,418,777 106,031,694 1,878,450,471 +14 Total, 1918 19,716,988,211 1,274,824,039 20,991,812,280 +H Total, 1917 17,197,733,209 1,174,144,540 18,371,877,749 COMMERCIAL FAILURES. The number of commercial failures fell sharply, and in October there were only 19 in the Third Federal Reserve District, which is the lowest number recorded in some years. It is interesting to note that during other wars the experience has been that the inflation of commodity prices reached its peak about the time that peace comes definitely in sight, followed by a period of a few months in which there was a marked decline in the number of commercial failures. A decline in commodity prices generally followed the termination of the war, which in turn was followed by a sharp rise in the num ber of commercial failures. According to Bradstreet's commodity index number, prices have been gradually declining since the apparent peak reached last July so that an increase in the number of failures may be expected. Brad-street's report of commercial failures in the Third Federal Reserve District, classified as to capital employed. $5,000 $5,000 $20,000 $50,000 $100,000 Total. and to to to to less. $20,000. $50,000. $100,000. $500,000. 1918 1917 January 71 7 1 79 75 February 68 7 2 1 78 51 March 54 4 2 63 61 36 1 2 39 56 May 48 4 2 2 55 61 Juiie 33 33 45 July 28 1 29 48 August 30 2 32 49 September 28 1 32 40 October 16 3 19 65 20 3 3 26 CO December 23 1 2 23 63 Total, 1918 455 35 11 9 2 512 Total, 1917 629 27 14 2 2 674 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NT). 3—PHILADELPHIA. 419 IMPORTS AND EXPORTS. The foreign business through the port of Philadelphia was quite heavy throughout the year, although exports were not as large as in the preceding year. Imports were uniformly greater than during 1917. Business through the port of Philadelphia. Exports. Imports 1918 1918 I 1917 January $38,975,065 $43,634,046 $7,082, 093,450 February... 26,534,875 57,652,322 8,021, 041,989 March...... 32,903,058 38,879,748 10,082, 438, 047 April 39,962,456 39,889,979 13,086, 103,862 May 40,919,371 42,507,832 13,533, 424, 218 June 26,786,000 41,284,111 9,932, 304,452 July 28,493,000 21,451,383 11,181, 953, 507 August 39,307,314 57,381,188 8,387, 247, 078 September., 54,356, 000 24^093,366 9,567, 276,928 October 38,650,995 62,724,000 8,776, 486,000 November.. 28,920,174 32,309,000 8,850, 106,000 December.. 31,224,722 40,158,000 6,069, 413,000 Total ' 427,033,030 501,964,975 114,571,396 101,971,531 FREIGHT-CAR MOVEMENTS. During the early part of the year the movement of freight by rail roads in the district was seriously hampered by congestion at ter minal points, fuel shortage, and unusually cold weather. Begin ning with the month of May conditions showed much improvement. Eastbound shipments of bituminous coal at Lewistown Junction, on the Pennsylvania Railroad, were 18 per cent larger than the pre ceding year. Pennsylvania Railroad freight-car movements at Lewistown Junction, Bituminous Coke Miscellaneous Miscellaneous coal eastbound. eastbound. eastbound. westbound. Total, 1918 1917 1918 1917 1918 1917 1918 1917 1918 1917 January 33,397 41,132 3,111 5, 563 17,946 33,820 7, 908 21,047 62,362 101,552 37,728 35, 216 3,692 4,290 21,822 31,024 10,509 18, 733 73, 751 89,263 March 44, 505 45,843 4,279 5, 751 33, 325 38,833 14,524 24, 629 96,633 115,056 42, 502 41.192 5,816 5,552 34, 331 39,103 17,196 24,375 99,845 110,222 May 53,156 45,785 5,608 5, 643 34, 234 38, 085 18, 333 26,201 111,331 115,714 June 54,479 42,824 5,114 6,034 32, 581 34, 382 19, 018 26,257 111,192 109,497 July 53, 614 41,367 5, 566 6,366 34,115 33, 057 21,459 25,479 114,754 106,269 August 54,562 40,442 5,277 5, 796 33, 697 30,618 17, 238 24, 775 110, 774 101, S31 September 55,101 38, 215 4,709 5,596 31, 787 31, 766 16,884 22,821 108,481 98,398 October 53'. 396 38,009 4,737 5,503 31, 635 30,211 15, 821 20,834 105,589 94,557 43; 464 40, 031 4,133 5,404 33, 441 26,917 15,358 17, 641 96,396 89,993 45, 297 32.193 4; 076 4,449 33, 993 19,300 15,216 9,958 98,582 65,900 Total 571,201 482,249 56,118 65,947 372,907 387,116 189,464 262,750 1,189, 690 1 193 0(52 POST OFFK :E BU SINES S. The business of the post offices throughout the district was con siderably ahead of last year, both in postal receipts and money-order transactions. Increased industrial activity resulted in a heavy increase in the use of the mails. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

420 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. Postal and money-order business. Postal business. Money-order business. Post office at— 1918 1917 1918 1917 Allentown, Pa $343,514 $266, 749 $694,929 $591,399 Atlantic City, N. J 480,929 372,626 241,825 180,894 856,649 663,064 Camden, N. J 422,751 343,359 1,643,848 1,159,072 Harrisburg, Pa 701,948 626,976 2,146,215 1,731 978 Lancaster, Pa 276,280 226,946 318, 737 278 888 Lebanon, Pa 75,869 63,820 348,491 312,759 Philadelphia, Pa 11,730, 505 10,505,242 33,077,822 26,724,046 Scranton, Pa 668,231 543, 725 781, 922 628,827 Trenton, N. J 804,233 442,749 3,265, 560 2,545,547 Wilkes-Barre, Pa 354,827 277,661 - 778,196 646,367 Williamsport, Pa 226,253 205,136 318,281 289,350 Wilmington, Del 681,965 471,830 1, 634,200 967,631 RESUME OF BUSINESS CONDITIONS. January.—General business was disturbed by the inauguration of "heatless Mondays/1' which caused the shutting down of industry for several days for the purpose of relieving the freight congestion and expediting the distribution of coal. All branches of business directly connected with the war continually absorbed more and more of the productive capacity of the district and gave constant employment to labor at high wages. Labor conditions were unsatisfactory and much complaint was made about the shifting of workers and the loss inci dent to the continual reemployment of men. Iron and steel plants operated at about 30 per cent of capacity in the middle of the month, the situation being worse than at any time since the beginning of the war. Iron and steel producers were hampered not only by their inability to secure coal and coke, but by the sweeping embargoes on outgoing traffic. Retail trade was much better than might have been expected after the holiday season. The demand for necessities was preeminent, the demand for luxuries declining. The money market was quiet but firm. Call mone}^ ruled at 6 per cent, and choice commercial paper from 5J to 6 per cent. February.—Aside from the interruption in business caused by the closing down order on Mondays, there was no important change in conditions, manufacturers as a rule continuing to operate to as near capacity as circumstances permitted. Retail trade was ahead of last year, both in quantity of goods sold and in value of sales. Due to the railroad congestion, large quantities of finished goods accumu lated, which resulted in curtailing production and the tying up of much capital. The iron and steel industry was still partly paralyzed by the lack of fuel and transportation facilities, production being about 50 per cent of capacity. The banks were unable to accumulate surplus funds owing to the continuous purchases of Treasury certifi cates of indebtedness and the renewal of notes by their customers, whose business was seriously hampered by the railroad freight tie-up. Rates for money advanced slightly, commercial paper selling at 6 per cent, a slight concession being made, however, for the best names of short maturities. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 3—PHILADELPHIA. 421 MareJi.—Favorable weather conditions and the consequent easing up of the fuel situation resulted in increasing activity in man}^ lines of industry. There was a strong retail demand for seasonable ap parel. Considerable difficulty was experienced in obtaining adequate help, and necessary advances in wages added to the already greatly increased cost of doing business. The moderation in the weather permitted of steady improvement in the movement of freight cars. The supply of sugar showed some increase, but flour was scarce and substitutes hard to get. Iron and steel production recovered slowly, plants running at from 60 to 75 per cent of capacity. The impossi bility of securing heavy leathers limited the production of turned shoes. The textile mills ran to capacity. Money rates remained high, the market being on a 6 per cent basis. Very little choice com mercial paper was offered, but there was a liberal supply of the medium grade. Banks were preparing for the third Liberty loan campaign. The Philadelphia institutions rediscounted in consider able volume, borrowings by out-of-town banks being comparatively small. April.—The industrial capacity of the district was devoted increas ingly to the production of materials essential to the conduct of the war. This was accomplished through the extension of the system of Government priority orders, which controlled the distribution of raw materials. Many concerns which had been engaged in the pro duction of nonessentials diverted their plants to the manufacture of some kind of war materials and supplies. The gradual shifting of labor to the more essential war industries, in addition to the diffi culties in obtaining supplies, reduced the output of nonessential goods. Although buyers displayed conservatism, the volume of sales in retail lines was very satisfactory. Business during the first part of the month was slightly behind that of last year because of an early Easter and bad weather. On account of high wages, wage earners were the principal purchasers of goods, being able to buy goods which they had previously been unable to purchase. Proprietors of small stores in some of the large cities closed their stores and took employment in the shipyards and other places where they could earn more money. Farmers financed themselves by cash payments, due, apparently, to the prosperity brought about by high prices during the last few years. The use of bank loans or notes to implement dealers to finance such transactions fell off to a very noticeable extent. Some industries were embarrassed by the rapidly increasing costs of production and inability to secure a sufficient supply of labor. Mone}^ rates remained firm, the prevailing rate for commercial paper being 6 per cent. May.—The industries of the district were almost completely ad justed to a war basis. Retail trade was about 40 per cent ahead of last year. Business was hampered considerably by scarcity of many Digitized fokr FinRdAsS EoRf raw materials and the inadequate supply of competent labor. http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

422 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. The production of iron and steel was about 95 per cent of capacity. The economy campaign resulted in an easing in the food situation. Motor trucks came more and more into use as the congestion increased around the principal industrial centers of the district. Shipments between cities were made on regular schedules maintained by numer ous companies operating trucks. A firm money market prevailed, 6 per cent being asked on both call and time loans. Borrowings by member banks were not as heavy as anticipated, and the third Lib erty loan was floated apparently without any undue strain on the money market. June.—General confidence in the business situation was denoted by the liberal advance buying throughout the district. Retail de mand for seasonable merchandise continued active, although the steady decrease in the variety of goods offered by the leading stores and the uniformly high prices caused a well-defined tendency toward economy. In all lines increasing difficulty was experienced in replen ishing supplies. The railroad freight-car movement improved greatly and coal moved more freely. The crops throughout the district were reported up to the average for the past 10 years. The building situa tion continued quiet, new construction being confined almost exclu sively to the erection of buildings for the Government or war indus tries. The money market remained firm at 6 per cent. Increased activity was noted in the sale of bonds and other securities. July.—Notwithstanding the shortage of supplies affecting prac tically all lines, marked activity in general business continued, the demand for most kinds of merchandise being greater than the supply. Midsummer influences were not very noticeable. Business at the South Jersey seashore resorts was quiet. Hotels which were normally crowded in July were not half filled, and the stores felt the effects of war-time economies. There was little inclination among the major ity of people to go away for any extended time. Many who formerly went to the seashore or mountain resorts for the better part of the summer remained in or about town. The shipyards and war indus tries in the vicinity of Philadelphia absorbed workmen from all j>oints, and created a severe shortage of rentable property. The stringency was not relieved materially by new home construction, as building .was still quiet. Difficulty in obtaining financial accommodation and high costs and scarcity of materials and labor continued to operate as restrictive factors in this industry, which was at the lowest mark for a decade. Prospects of early-sown crops faded somewhat owing to the prolonged dry weather, but the shading of estimates thus rendered necessary was not material. The rate for money ruled at 6 per cent. The market was freed from much unnecessary financing by the Capital Issues Committee and the banks responded to the war needs of the Government by curtailing their credits to nonessential industries. Digitized foBr FuRsAinSeEsRs on the Philadelphia Stock Exchange was dull, although http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 3—PHILADELPHIA. 423there was continued absorption by investors of high-grade railroad securities. August.—General business throughout the district was back to substantially the maximum level of a year ago. The demand for goods necessary to the conduct of the war was sufficient to more than employ all available machinery and labor. The distribution of goods through the jobbers and retailers was satisfactory and collections were very good. The coal situation was more satisfactory mainly because the car supply showed improvement. The wool business was taken over by the Government. No wool was sold for civilian purposes, and all importation of foreign wools was suspended, except for Government use. The largest possible tonnage of iron and steel was being turned out, the July output of iron being better than for any similar month and the number of furnaces in blast the greatest ever known. Government financing and the requirements of business maintained an active demand for money. Hates throughout the district continued firm at 6 per cent for nearly all classes of loans. The large subscriptions of banks to United States certificates of indebtedness caused them to restrict credits wherever possible, and the tendency was to curtail accommodations to lines of business not necessary to public welfare or essential to the conduct of the war. Sentiment was helped by the announcement that the interest rate of the fourth Liberty loan would not be higher than that of the third loan, and increasing confidence in the security markets was noted. September.—Business conditions throughout the district continued favorable, trade in most lines surpassing last year's records. Manu facturers in all important lines operated to the fullest extent permit ted by the available supplies of materials and labor. Retailers reported a steady demand for all kinds of staple commodities, but experienced difficulty in obtaining sufficient merchandise to meet the requirements of their customers. Retail distributors of women's wearing apparel did a large business, the demand for high-class goods being greater than ever before. Wholesale dry-goods houses reported the receipt of large orders, but in some instances, actual sales ran behind those of last year owing to the physical impossibility of getting out orders, due to the deficiency in the supply of labor. The raw cotton market was unsettled by the price-fixing plans. Textile mills continued very busy. Money was still quoted at 6 per cent. Banks sought little or no paper from brokers and loans were scrutinized closely. October.—Efforts to increase the output of iron and steel plants and other industries which had large Government contracts caused improvement in both the number of hands employed and in the quan tity of production. Retail trade showed a large increase during the month up to the beginning of the influenza epidemic. Since that time the number of customers visiting the stores decreased about Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

424 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. one-third and the volume of sales from 30 to 50 per cent, and working forces of all business concerns were affected very much; at times as many as one-third of the employees were unfit for duty. The epidemic also greatly affected the coal output, causing a decline in the production of anthracite of from 250,000 to 300,000 tons per week, some of the collieries being compelled to close. The scarcity of pig iron became more acute, there not being enough of any grade to take care of the demand. Results of the efforts to speed up pig iron production are reflected in the figures for September, which show a daily average of 113,942 tons, the highest in the history of the industry. Financial transactions were overshadowed by the Liberty loan campaign. The minimum rate for paper remained at 6 per cent. During the month Bradstreet's report showed only 19 failures in the district, the lowest for a long time. November.—A more normal business situation resulted from the waning of the influenza epidemic. Retail trade improved wonder fully and merchants expressed the belief that the buying during the balance of the year would more than make up the loss caused by the epidemic. While there was a strongly defined tendency to mark time, with a view to determining the probable extent of readjust ment after the war, the consensus of opinion was that the period of readjustment would be relatively short, to be followed by an era of industrial activity. Overtime and Sunday work were abolished in war and shipbuilding industries. The situation with regard to supplies of fuel reflected considerable improvement, despite the loss in output occasioned by the influenza epidemic. There was a down ward tendency in cotton yarn prices while the Government was adjusting contracts. Some wool was released by the Govern ment for civilian use. Sentiment among builders was particularly optimistic, as they looked for a pronounced increase in activity with the removal of Government restrictions and the probable increased supply of labor that was expected to follow a curtailment of Govern ment construction. The prevailing rate for paper was 6 per cent, with banks buying very little. December.—The readjustment to peace conditions proceeded very rapidly and with much less disturbance to business than was generally expected, especially in industrial lines, where the principal effect of the ending of the war appeared to be reflected in the elimination of overtime work. Retail trade was exceptionally good, retailers of men's wearing apparel reporting business 25 per cent ahead of December, 1917. With the war over, the public believed there was no further need for stringent economy and felt free to purchase liberally all kinds of goods. Thousands of wage earners were released Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 3—PHILADELPHIA. 425 which had been pushed to the utmost for the past few years on war work, experienced a let-up in the strain with the cancellation of war orders, the amount of accumulated civilian orders not being large. The outlook, however, was considered bright. Dealers in automobile pleasure cars were very optimistic regarding the future. The money market in Philadelphia remained firm at 6 per cent. Public participation in the speculative markets was at a low ebb, owing to money restrictions and uncertainty regarding the readjust ment period and the future of the railroads. EXHIBIT A.—Movement of principal earning assets of the Federal Reserve Bant of Philadelphia during the calendar year 1918. [In thousands of dollars; i. e., 000 omitted.] Discounted paper Total by s S e t c U a u n t r e i e s t d e d dis p O c a o t p h u e e n r r , t ed] (1+2) m i b n o B a o u r i k p l g l e e s h n t t . b c i o l a u ls n n d d t e is d Pe (1 r -T c - e o n ) t. war obliga bought. tions. 5 6 Jan.4 19 971 12,992 32,963 18,364 51,327 38.9 Jun.ll 18, 410 10,746 29,156 17,045 46,201 39.8 Jan.18 18, 015 13,148 31,163 14,269 45,432 39.7 Jan.25 18 797 15,013 33,810 14,179 47,989 39.2 Feb. 1 17, 640 15,989 33,629 13,860 47,489 37.1 Feb.8 14, 234 10,919 25,153 13,260 38,413 37.1 Feb. 15 15, 345 10,881 26,226 17, 738 43,964 34.9 Feb. 21 16. 249 8,600 24,849 18,264 43,113 37.7 Mar. 1 14, 733 7,516 22,249 17,475 39,724 37.1 Mar. 8 16, 002 9,050 25,052 18,901 43,953 36.4 Mar. 15 15, 232 9,058 24,290 19,172 43,462 35.0 Mar. 22 19, 957 9,308 29,265 18,172 47,437 42.1 Mar. 28 21, 828 9,591 31,419 22,440 53,859 40.5 Apr. 5... 18, 617 8,380 26,997 21,898 48,895 38.1 Apr. 12 19, 671 7,254 26,925 21,290 48,215 40.8 Apr. 19 22 057 4,555 26,612 27,440 54,052 40.8 Apr. 26 .. 27, 806 7,545 35,351 26,303 61,654 45.1 May 3 28, 798 10,510 39,308 23,933 63,241 45.5 May 10 29, 251 9,178 38,429 25,727 64,156 45.6 May 17 26, 185 10,091 36,276 26,956 63,232 41.4 * May 24 29! 541 11,149 40,690 23,438 64,128 46.1 May 31 3F 517 11,323 42,840 20,968 63,808 49.4 June 7 36, 006 13,593 49,599 23,114 72,713 49.5 June 14 37, 762 12,534 50,296 21,281 71,577 52.8 June 21 40' 530 14,485 55,015 19,944 74,959 54.1 June 28 43; 933 16,284 60,217 18,104 78,321 56.1 July 5 47'. 755 23,491 71,246 16,756 88,002 54.3 July 12 41, 423 25, 761 67,184 16,033 83,217 49.8 July 19 42, 867 29,042 71,909 12,157 84,066 51.0 July 26 50, 589 30,802 81,391 13,430 94,821 53.4 Aug. 2 53 961 29,020 82,981 14,026 97,007 55.6 Aug. 9 64 321 28,025 92,346 11,684 104,030 61.8 Aug. 16 65; 021 28,964 93,985 11,326 105,311 61.7 Aug. 23 59; 304 25,879 85,183 11,035 96,218 61.6 Aug. 30 65, 357 25,913 91,270 9,762 101,032 64. 7 Sept.6 70, 185 29,508 99,693 8,856 108,549 64.7 1 fiopt.13 70, 650 26,678 97,328 9,693 107,021 66.0 j Kept. 20 80, 609 21,030 101,639 9,044 110, 683 72.8 Sopt.27 86, 718 21,112 107,830 7,976 115,806 74.9 Oct. 4 88, 904 19,718 108,622 21,754 130,376 68.2 Oct. 10 90, 362 18,477 108,839 24,883 133,722 67.6 Oct. 18 91, 648 14,739 106,387 26,082 132,469 69.2 O N c o t v . . 2 1 5 9 7 8 8 , , 3 0 5 4 4 9 1 1 2 7 , ,9 9 5 9 8 2 1 9 1 1 6 , , 3 0 4 0 6 7 3 3 0 6 , , 9 6 1 1 5 3 1 15 2 2 2 , , 6 2 2 6 0 1 6 6 4 4. . 2 1 ! N N N N D o o o o ec v v v v . . . . . 6 2 8 2 1 9 2 5 1 1 1 1 1 2 6 4 6 4 3 6 4 5 7 , , , , , 5 0 5 4 2 0 7 0 7 3 6 1 5 2 2 1 1 1 1 1 5 5 8 0 6 , , , , , 8 2 3 4 9 9 3 3 8 9 0 4 9 6 2 1 1 1 1 1* 3 6 8 5 8 8 2 1 7 2 , , , , 8 , 3 9 9 5 1 6 9 9 6 0 2 8 1 6 3 2 4 1 6 3 0 2 5 , , , , , 0 5 2 8 3 4 8 6 7 4 2 6 2 5 3 1 1 1 1 1 9 8 9 8 8 1 2 7 8 1 , , , , , 2 9 8 6 1 6 4 6 0 5 0 8 6 8 3 6 8 8 7 8 3 7 8 0 6 . . . . . 6 1 2 1 9 | D D De e e c c c . . - 2 2 1 7 0 3 1 1 1 6 6 5 1 3 3 ' , 2 0 41 8 8 7 5 5 1 1 1 9 8 4 , , , 5 2 5 8 4 5 4 7 7 1 1 1 8 8 6 0 1 7 , , , 6 8 6 6 6 4 4 9 2 5 3 5 , , , 6 2 8 9 4 3 4 8 3 1 1 1 8 7 8 7 3 3 , , , 5 4 9 6 7 1 3 5 2 8 8 8 K 7 7. . . 1 8 2 1 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

426 ATSJ^UAL REPORT OF THE FEDERAL RESERVE BOARD, FEPERAL RESERVE BANK OFPHllAPELPtilAs MOVEMENT OF EARNING ASSETS DURING THE CALENDARJEAR1318 .^ Curvet: Jf&r/oanJ&Ker. (hrivZ.Jo6al$ilh®is&an6c&l &rrc3.-joais discounted unci bought. _ Oxrye4:JotalSxrnin^j{ssets zkcl. US. (^yernMcn^Secdnties) J toJbtaLJBiUs Siscou^ttedandJSoagfU;, wo\ \240\ 30 \ \220 220\ ha? WO \200\ ISO 6s\ 160 \M \/20 \KX) -3s\ -30\ 60 40 20 4 !t $Z£I $152f IS t5ZZSSJZ8aS3Q I?&3t?HZ3!Sft 8X231623306333274 f! #251* IS2£&6^ JAN. \FEB. IMCH. I APR. I MAY \JUNB\ JULY \ AUG. \S£PT.\ OCT. \ NOK \ DEC. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTEICT NO. 3 PHILADELPHIA. 427 EXHIBIT B.—Movement of cash reserves, net deposits, Federal Reserve note liabilities, and the reserve percentage of the Federal Reserve Bank of Philadelphia during the calendar year 1918. [In thousands of dollars; i. e., 000 omitted.] • Ratio of cash re Federal serves Total Reserve to net re c s a e s r h v e. dep N o e s t i ts. in n a o c t t e u s al (2+3) d F e e p d o e s r i a t l a R n e d circulation.! serve note liabilities combined. Jan. 4... 118,722 79,587 93 172,816 68.7 Jan. 11.. 126,288 81,057 93 171,275 72.5 Jan. 18.. 123,748 79,002 91 170,825 72.4 Jan. 25.. 128,320 87,223 91 178,653 71.8 Feb.l.. 125,780 83,467 94, 177,681 70.8 Feb.8.. 146,161 91,434 97, 188,633 77.5 Feb.15. 129,839 76,153 100'. 176,766 73.5 Feb. 21. 133,148 78,292 102! 180,468 73.8 Mar. 1.. 138,889 80,108 103' 184,091 75.4 Mar. 8.. 143,622 87,014 104 191,810 74.9 Mar. 15. 142,095 83,080 107 190,674 71.5 Mar. 22. 144,934 90,456 108 199,371 72.7 Mar. 28.. 147,522 93,592 114 207,854 71.0 Apr. 5.. 151,129 89,706 116 206,584 73.1 Apr. 12. 151,488 89,263 118 207,442 73.0 Apr. 19. 151,709 87,938 119 207,119 73.2 Apr. 26. 142,947 83,164 121 204,240 70.0 May 3.. 152,660 90,540 124 214,624 71.1 May 10., 158,236 94,044 125 219,285 72.2 May 17.. 152,714 86,072 126 212,762 71.8 May 21. 141,331 73,864 128 202,278 69.9 May 31.. 155, 205 82,012 133 215,771 71.9 June 7.. 159,644 93,796 13o 228,800 69.8 June 14. 154,463 83,068 139: 222,384 69.5 A A J J J J J J u u u u u u u u l l l l n n y y y g y g e e . . 1 2 1 2 5 2 9 2 0 6 2 1 8 . . . . . . . . . . . , . . 1 1 1 1 1 1 1 1 5 5 5 4 1 4 5 5 5 8 7 7 5 0 5 3 , , , , , , , , 8 0 6 8 2 9 5 2 8 1 7 9 8 8 2 2 4 0 6 7 9 7 5 2 8 8 8 7 7 8 7 7 2 0 3 3 0 9 8 2 , , , , , , , , 8 9 5 1 5 3 9 4 2 5 4 2 6 0 6 9 4 0 2 3 2 5 1 2 1 1 1 1 1 1 1 5 4 6 4 5 5 6 ' 1 7 7 5 3 2 ; . ; 2 2 2 2 2 2 2 2 3 4 4 3 1 3 5 1 8 6 6 2 7 4 9 5 , , , , , , , , 1 2 7 2 8 8 5 9 ? 7 4 9 6 7 6 2 9 8 0 5 6 9 2 0 6 6 6 6 6 6 6 3 5 2 6 3 6 6 . . . . . . . 4 0 7 7 3 1 0 Aug. 16. 167,165 90,539 174; 267,771 61.0 A A S D S D D S N D S N N N N O O O O e e e e e u e u e o e o o o c c o c c p p p p c c c g g t t v c v v v t t v . . . . t t t t . . . . . . . . . . . . . . . 1 1 1 2 2 4 2 6 3 2 2 1 2 2 2 1 8 l 6 0 8 3 5 7 0 . 0 . . 3 9 2 3 5 7 0 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 7 7 3 4 6 8 7 7 7 3 2 7 2 8 8 6 3 2 3 7 9 8 2 3 1 2 1 1 4 6 3 0 7 7 8 4 8 5 , , , , , , , , , , , , , , , , , , , 6 2 0 9 4 3 5 4 0 6 9 1 2 8 1 6 1 5 6 3 7 9 2 4 0 5 8 1 8 8 8 0 8 2 4 7 9 6 4 4 0 0 3 6 6 7 2 9 8 5 6 3 8 7 8 2 6 1 9 9 9 9 8 9 9 8 9 9 8 8 8 9 8 8 7 7 0 3 8 3 5 7 8 0 7 7 8 2 7 4 2 7 7 9 6 3 , , , , , , , , , , , , , , , , , , , 2 1 5 0 8 4 1 0 5 8 8 8 6 9 9 4 2 6 7 7 7 8 0 5 8 6 6 5 8 4 7 2 7 5 8 9 2 9 4 4 6 6 2 7 9 5 7 7 7 5 0 1 1 2 9 2 2 2 1 1 2 2 2 2 2 2 2 1 1 2 2 2 2 1 I 1 0 2 9 3 2 2 1 2 8 7 S 1 2 9 1 2 9 1 9 5 3 9 2 3 6 7 5 5 7 O 1 2 6 4 2 5 6 a i ! ; ; ! ! ! ! , ! ! 3 3 3 3 2 3 3 3 3 3 3 3 3 2 2 2 3 2 2 0 2 1 2 1 0 1 1 2 0 1 0 9 0 8 8 8 6 6 9 1 1 0 0 8 1 9 2 8 4 8 3 5 1 6 2 7 0 , , , , , , , , , , , , , , , , , , , 1 6 7 0 2 3 8 6 4 6 8 7 4 0 8 3 7 2 3 4 9 5 4 1 9 3 9 1 5 0 6 7 3 3 4 0 9 1 7 4 5 0 5 3 3 7 5 3 1 6 3 8 7 2 2 6 3 5 3 3 4 5 5 5 5 4 4 4 6 6 6 4 4 6 6 6 6 9 4 1 9 4 9 9 6 2 1 2 8 2 3 2 2 1 3 3 4 . . . . . . . . . . . . . . . . . . . . 6 8 6 0 8 2 5 4 4 0 0 2 2 0 0 8 2 1 6 S 233! Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

428 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. FEDERAL RESERVE BANK OF PHILADELPHIA. ^DEPOSIT AND NOTE LIABILITIES,! ALSO CASH RESERVES, [DURING THE CALENDAR YEAR 1918. \ Curve/: ^et deposits. CurreZ.Jobal Cash Reserves. \ Curve J.- Aggregate Jfet ®efwsi£ and &•%. MteJGtixhilities. Curve4: Static of Cash, Reserves to jfggregate JVettDepasCt and, 3TSI. JToCe HabUMes. \60A eo\ \?S\ \30dc75\ \/v\ 70 \270\ \6o]i Z4Ck60\ \ss\ 5S\ 210 \so\ -so\ \4S\ 130 •4o\ /SO 35" \ 3S\ IEO\ lilMiiiiiw eo\ \60 60\ \30 \30\ 4tl'JtSt4£&'I<f&&J8Sa/9&3J0l7M3t?KaatS-ZBXZS J6aJ06O20Z>4i//9&/*JSZZ296S&g>\ JAN. 1 FEB. \ MCH. I APR. MAT\JUN£\JULY \ AUO.\SEFT.\ OCT. \ NOV. \ PEG- Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 3—PHILADELPHIA. 429 SCHEDULE 1.—Comparative statement of condition of the Federal Reserve Bank of Philadelphia. Dec. 31, 1918. Dee. 31, 1917. Dec. 30, 1916. Collateral notes—members $135,032,810.41 $4, OOS, 400.00 $900,000.00 Bills discounted—members 43, 787,151.29 31,903,836.94 663,076. 79 Bills bought in open market 3,011,280.08 18,390,067. 91 13,656,430.08 United States bonds and notes. 11,417,900.00 9,649,950. 00 2,825,000.00 Municipal warrants 10.000.00 465,112.22 Earning assets 193,249,141.78 63,962,254. 85 18,509,619.09 Interest accrued on United States bonds and notes 43,309.74 58,906.44 17,057.93 Cost of unissued Federal Reserve notes 511.99 27,708.01 Expenses paid in advance 2,055.51 2,445.83 Transit department expenses 1,367.18 Furniture and equipment—transit department 25,580.56 15,409.87 Bank premises 500,000.00 Due from Federal Reserve Banks—net '. 12,370,908.10 5,382,501.30 Due from banks and bankers 1,517,804.61 609,389.97 Exchanges for clearing house, cash items, etc 33,558,293.29 7,378,564.69 3,864,733.22 Uncollected items—Federal Reserve Banks 41,527,684. 40 Uncollected items—banks, member and nonmember 12,029, 710.01 Member banks—overdrafts 59,024.31 12,804.81 Difference account , 1,527. 68 Federal Reserve notes on hand 11, 739, 400.00 '4,"348,590."66' 171,140.00 Federal Reserve bank notes on hand 332,037.00 Due from Treasury—5 per cent fund Federal Reserve bank notes 475.000.00 Notes of national and other Federal Reserve Banks 3,737,000.00 1,353,500.00 463,476.00 Mutilated currency forwarded for redemption 56,027.50 132,500.00 Mutilated Federal Reserve notes 1,019,340.00 209.09 121.89 Nickels and cents , 271.16 Liberty loan bonds sold on instalment plan 11,371.00 Miscellaneous assets 110,032.85 G old with Federal Reserve agent 85,5S3,245.00 63,945,755.00 Gold redemption fund1 7,900,000.00 1.500,000.00 100,000.00 Gold settlement fund , 37, 412, 400.54 32,101,000.00 8,042,000.00 G old coin and certificates 1, 459,351.21 19,064,667. 50 16,988,892.50 Bank of England sterling gold account 3,675,000. 00 Other lawful money 1,667, 646. .00 1,189, 996.10 466,154.30 Reserve 134,022,648. 75 121, 476, 418. 60 25, 597,046.80 Total resources. 433,069,038. 29 212,674,169.60 54, 794,517.09 LIABILITIES. Capital, 7,562,450.00 6,142,150.00 5, 228,100.00 P S r u o r f p i l t u a s nd loss "i," 171.92 220, 238. 27 89,966.68 Unearned discount and interest 540.69 160,902. 51 39,559.33 Reserve for franchise tax i, 171.92 Reserve for depreciation United States securities.. 131.00 Government deposits 128.17 *5"387"488'53 "3," 145," 549." 05 Due to other Federal Reserve Banks 515. 88 Uncollected items—Federal Reserve Banks 177.38 Uncollected items—member banks 645.33 Due to member banks .• 124. 95 103,000,930.13 44,965,072.26 Cashier's checks 036.05 435,026.66 26,015. 72 Federal Reserve notes outstanding 745.00 97,325, 755.00 1,300,000.00 Federal Reserve bank notes outstanding 200.00 Miscellaneous liabilities 1,678. 50 254.05 Total liabilities .... 433,0G9,038.29 212,674,169.60 1 In June, 1917, the statement was changed so as to include gold with Federal Reserve Agent under " Gold redemption fund,'' and " Federal Reserve notes" now represent gross liability for Federal Reserve notes, instead of only the net liability. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

430 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. SCHEDULE 1 A. A5S&T5 FEDERAL RESERVE BANK OF- PHILADELPHIA 1917 1316 BILLS DISC WARRA11T5 U.S.BONOS 8 £12,674,159 1318 $433, 069,000 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 3—PHILADELPHIA. 43X SCHEDULE 1 B. LIABILITIES FED&RAL RE5ERV£ BANK OP PHILADELPHIA 1917 1916 & 54% 790, 000 S 212,574,169,60 -f ,VV sO-' .cV "*• '<f FEDERAL RESERVE: NOTES, >\Ur ^ U#> 5.6 % 55. S %/ a? M&MB&R BANKS DEPOSITS 23 % LGOVBRMM&NT 1 DEPOSITS 1.1 % 1918 ea »433,069,000 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

432 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. SCHEDULE 2,—Profit and loss statement. Earnings for 1918.... $4, 357, 740. 39 Expense of operation $596, 545. 08 Cost of Federal Reserve currency (including expressage, insurance, etc.) 243, 857. 27 Repairs, alterations, improvements, etc. ,to bank building. 31, 471. 31 Furniture and equipment—total amount charged off during year 215,042.72 Total current expenses 1, 086, 916. 38 Net earnings for year 3, 270, 824. 01 Profit and loss, Jan. 1,1918 220, 238. 27 Total 3, 491, 062. 28 Less: Depreciation on bank premises 182, 604. 74 Amount transferred to account reserved for deprecia tion on United States bonds 116,131. 00 298, 735. 74 Net amount available for dividends, surplus, and franchise taxes. 3,192, 326. 54 Dividends paid: Date paid, June 29, 1918; period covered, 12 months. $366, 383.14 Date paid, Dec. 31, 1918; period covered, 6 months.. 215, 798. 06 Interest paid on stock surrendered 1, 801. 50 Total dividend payments 583, 982. 70 Carried to surplus fund 1, 304,171. 92 Transferred to account " reserve for franchise tax " 1, 304,171. 92 Total 3,192, 326. 54 SCHEDULE 3.—Earnings and expenses. Earnings. Expenses. An i m n F e v r n o e m t s s t . r p e c D t e s i i e n e e e f n a s r i . v t l e | p S d i r u t r o s y n . f T e in a o g r t n s a . l o p t p E i e o o e n x f r n s a . e is N s o u t e e s . 'c c D h i e a a p r ti g r o e e n s . p T e e o n x t s a e l . e i N n a g r et n s . o e i n f r n a a u g r n t a n e s e l . t 1918. January [$181,212 $1,272 $696 $183,181 $29,100 $1,320 $541 $30,962 §152,218 26.4 February 158,443 3,455 5,899 167,797 30, 419 10,480 560 41, 459 126,337 24.2 March 194,0S5 1,428 13,861 209,376 30,674 11, 720 595 42,990 166,385 27.8 April 212, 439 1,422 13,036 226,898 31,9G7 5,920 679 38,507 188,331 33.2 May 239, 501 3,190 13,832 256, 524 38,621 19,400 745 58,767 197, 757 33.6 June 207,264 2,376 122, 712 292,353 69,266 15,680 936 85,883 206,470 36.4 July 321, 741 3,012 7,158 331,912 43,910 44 43,954 287,957 48.8 August 365, 628 3,212 1,497 370,339 46,958 99 47,058 323,280 53.5 September 407, 492 3,472 302 411,266 45,598 132 45,731 365,535 60.5 October 506,544 2,876 171 509, 592 59,824 616 60,441 449,151 71.7 November 691, 796 2,900 1,081 695, 777 57,101 685 57, 786 637,991 110.5 December 684,810 1,169 16, 755 702, 734 144,578 209,410 533,318 168,612 26.2 Total, 1918... 4,230,955!29,784 97,000 4,357,740 628,016 |243,857 1215,042 1,086,916 [3,270,824 46.0 Total, 1917... 987,0571 6,877 22,025 1,015,959 185,630 70,340 240 256,210 759,749 12.2 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 3—PHILADELPHIA. 433 SCHEDULE 4. 100823°—10 28 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

434 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. SCHEDULE 5. RESERVE: POSITION AND DEPOSIT AND MOTE LIABILITIES-1917 AND 1918-' FEDERAL RESERVE BANK OP PHILADELPHIA HEAVY BLACK LINE "REPRESENTS PERCENTAGE OP RESERVE TO COMBINED LIABILITIES Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

SCHEDULE C.—Reserve position on last Friday of each month. Liabilities (net). Reserve percentage. Ratio of Ratio of gold reserve Ratio of total to Federal Ratio of gold reserve Reserve Deposit, Note. Total. T go o l t d a . l r l e O a s w t e h r f e v u r l e . Total. m d g e l o o a p l n n d w o e e f s y t a u i n l t t s d o . t a o c n R c r u t o e F e l u s t a s e a e e t e d l s r i r e v o c v i e r n n i e a r . l l R i F d a t e e o e b n a p s d i o n e l n o e d t i r e e s r t v t i a i t e e l s s a l a 3 e c a g 5 t n t t d t a u i o p i e o i a n t e n p n l g e r s o s c t a s c a i i f i e s r n n t t c i n e e d u t r t e combined liabilities. 1918. January 5587,223,000 $91, 430,000 $178,653,000 $126,076,910 $2,242,941 $128,319,851 70.9 72.6 71.8 104.6 February 78,292,000 102, 176,000 180,468,000 132,210,405 937,673 133,148,078 77.4 71.0 73.8 102.2 March 93,592,000 114, 262,000 207,854,000 145,953,925 1,567,683 147,521,608 70.3 71.5 71.0 99.1 April 83,164,000 121, 076,000 204,240,000 141,497,110 1,449,552 142,946,662 69.4 70.4 70.0 92.8 May 82,012,000 133, 759,000 215,771,000 154,026,067 1,178,549 155,204,616 80.7 66.6 71.9 93.7 June 72,492,000 147, 430,000 219,922,000 144,734,867 551,864 145,286,731 67.3 65.5 66.1 81.0 July 83,361,000 162, 918,000 246,279,000 154,535,101 687,789 155,222,890 62.8 63.2 63.0 77.0 August 82,499,000 185, 243,000 267,742,000 170,901,041 784,397 171,685,438 66.0 63.3 64.1 77.1 September 87,065,000 199, 772,000 286,837,000 174,037,306 790,448 174,827,754 67.9 57.9 61.0 72.3 October 93,622,000 214, 793,000 308,415,000 172,698,381 745,202 173,443,583 51.0 58.5 56.2 65.5 November 96,870,000 223. 730,000 320,600', 000 126,345,828 573,904 126,919,732 41.9 38.6 39.6 41.6 December 88,173,000 233! 480,000 321,653,000 142,658,169 897,645 143,555,814 39.4 50.4 44.6 47.7 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

436 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. SCHEDULE 7. EARNING ASSETS AVERAGE DAILY AMOUNT ON HAND -1918 FEDERAL RESERVE BANK OP PHILADELPHIA IMILLIOJISI IMILLIONSI JAN PEEH MAR APS MAY JUNE JULY AUG SEPT OCT NOV DEC iPOLLflRS 40 20 0 40 2? 6 180 160 HO 100 80 60 40 20 0 BILLS DISCOUNTED SECURED BY U. 5. GOVERNMENT OBLIGATIONS 240 220 200 180 160 140 120 100 80 60 40 20 0 TOTAL EARNING ASSETS Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 3—PHILADELPHIA. 437 SCHEDULE 8.—Loans and investments made, by months, 1918. R e a f F e l o n i d e r g d d i i s m b f e c o l r e e r o a m l u p o n b a t R t h p e s e e r e r s o r f o p o A t u p h a c r e e n c c n r d e h p F a m f t s e r a a e d o n d r m e k c r i e e a n s t l u S c i n t h t a i d a U e t s e e s e n r s i t a r t s a e e g e k d p r c e e u u n e r r se U S O c n t u t a i r h t t i e e e t r i s d e s serve Banks. Reserve ments. purchased. Banks. January $36,200,982 $5,167,838 $9,786,450 February 31,868,368 9,171,201 6,030,000 March 29,416,927 13,129,363 9,344,500 $1,671,500 April 42,382,588 10,821,327 4,818,000 3,139,500 May 74,005,094 11,419,747 107,000 June 94,760,656 7,773,595 4,343,000 July 134,466,076 5,748,048 55,006 August 160,967,563 4,432,670 20,150 Seotember 161,218,400 2,741,791 3,272,000 October 221,693,196 30,976,704 18,452,500 November 359,648,434 17,290,606 2,281,550 December 511,014,436 1,335,136 3,850,900 Total, 1918 1,857,642,720 120,008,026 29,978,950 37,193,100 Per cent of total 90.8 5.9 1.5 1.8 Total, 1917 '. 223,416,008 85,913,796 18,792,250 Percent of increase or decrease 1918 over 1917. + 731 + 39 +258 Total. Number of Municipal member warrants. 1918 1917 ac b co a m nk m s o dated. January . $10,000 $51,165,27 0 $3,940,771 86 February 47,069,569 11,766,311 65 March 53,562,290 12,220,424 84 April 61,161,415 7,780,936 135 May 85,531,841 25,878,818 202 June 1 106,877^251 46,166,378 217 July ! 140,269,124 33,648,283 245 August ! 165,420,383 26,064,872 270 September - 167,232,191 25,000,483 305 October 271,122,400 21,394,910 318 379,220,590 50,991,728 315 December 516,200,472 64,889,565 342 Total, 1918 10,000 2.044, 832,79 fi 457 Per cent of total Total, 1917 1,621,424 329,743,478 201 Per cent of increase or decrease 1918 over 1917 -99 + 520 1 i SCHEDULE 9.—Average daily holdings of the several classes of earning assets for each month arid calendar year 1918. Total. Bills dis Bills United Munici counted. bought. States pal securities. warrants. 1918 1917 January $31,990,666 $15,582,286 $9,017,042 $2,580 $56,592,574 514,931,136 February 26,462,460 16,792,076 10,311,798 10,000 53,576,334 18,235,230 March 26,466,272 19,578,914 12,150,505 968 58,196, 659 16, 717,766 April 29,444,641 23,873,444 10,362,697 63,680, 782 20,325,8$ May 39,987,333 25, 205,982 3,962, 400 69,155, 715 26, 796,594 Juiie 51,902,348 20,680,337 4,732,850 77,315, 535 29, 541,435 July 70,513, 203 15,106,579 3,006,351 88,626,133 29,509,799 August 88,101,492 11,640,219 2,502,G08 102,304,319 31,787,718 September 100,833,261 9,830,323 3,976,516 114,640,100 34,467,512 October 105,708,472 26,254,322 6,172,614 138,135,408 29.005,633 November 151,510,450 30,326,700 7,649,618 189,486,768 43;187,433 December 180,015,946 5,838,714 11,963,835 197,818,495 62,337,298 Average for year 1918 75,556,041 18,375,123 7,135,005 1,068 101,067,237 Per cent 74.8 18 2 7.0 100.0 Average for 1917 9,923,917 14,916,598 4,268,208 "628,228 29, 736,951 29,736,951 Per cent of increase or decrease 1918 over 1917 +658 +23 + 68 -100 + 239 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

438 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. SCHEDULE 10.—Earnings from loans and investments for the calendar year 1918. Rills United Total. c B o il u l n s t d e i d s . m i b n o a o u rk p g e e h n t t . s S e t t i c a e u t s r e . i s w M ar u p r n a a i l n c t i s . 1917 January •$27, $181,212 $36,836 February 29, 158,443 42,145 March..* 39, 194,085 43,664 April 33, 212,439 46,938 May 12, 239,501 69,525 June 13! 267,264 76,934 July 321, 741 85,997 August 365,028 89,911 September 407,492 94,804 October 506,544 84,170 November 691,796 121,412 December 703,207 194,717 Total 233,489 4,230,955 987,057 Per eent of total 5.5 100.0 SCHEDULE 11.—Calculated annual rates of earnings from loans and investments. m B c e o il m u ls n b d t e e i r d s s .] m i b n B o a o u r i k l p g l e s e h n t t . U s S e t n t i c a e i u t t s r e e . i s d M w u a n rr i a c n ip t a s. l 1918 T otal. 1917 January 3.89 3.59 3.61 4.49 3.77 2.90 February 4.03 3.64 3.74 4.56 3.85 3.01 March 4.05 3.79 3.84 4.56 3.92 3.07 April 4.08 4,08 3.93 4.05 2.90 May 4.17 4.00 3.57 4.07 2.98 June 4.28 4.17 3.4a 4.20 3.16 July 4.32 4.23 3.30 4.27 3.43 August 4.23 4.23 3.33 4.20 3.33 September 4.38 4.25 2.90 4.32 3.34 October 4.38 4.45 2.50 4.31 3.41 November 4.42 4.29 2.43 4.32 3.42 December.. 4.27 5.01 2.36 4.18 3.07 Average for 1918. 4.29 4.12 3.27 4.59 4.19 Average for 1917. 3.73 3.18 2.90 2.89 3.32 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

SCHEDULE 12.— 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. 27, 1918. Maturities— Total. From 16 to 30 From 31 to 60 From 61 to 90 Within 15 days. days. days. days. Over 90 days. 1. Bills discounted—members: Secured by Liberty bonds and certificates- Member banks' collateral notes , $133,280,937.03 Nonmember bank paper, indorsed by member banks.. All other bills ""28," 135* 988*48 Member banks' collateral notes other than above specified., Commodity paper. Trade acceptances 628, 682. 03 All other bills not above specified •. i i 18,618,684.30 ; , i • ! Total $159, 235,029. 85 $16,781,121.71 $2,691,127.46 $1, 948,246. 28 $8,766.57 180,664,291,87 2. Acceptances bought: Bankers' acceptances- Foreign 1,797,205.05 Domestic 1 1 1,180,540.62 Dollar exchange bills (sec. 13, amended) 1 - 250,000.00 Trade acceptances- Foreign 20,526.00 Domestic Total 1,188,459.64 293,516.92 1,599,100.36 167,194. 75 3,248,271.67 3. Rediscounts for other Federal Reserve Banks 4. Municipal warrants 1 5. United States short-term securities 825,000. 00 42,500 00 500. 00 9,166,000.00 10,034,000.00 Grand total 161,248,489.49 17,117,138.63 4,290,227.82 2,115,941.03 9,174,766.57 193,946,563.54 Amounts of the several classes of discounted paper held by the Federal Reserve Bank and the Federal Reserve agent on above dates: Amount. Agricultural paper $170,032.15 Live-stock paper 300.00 Commercial and industrial paper. 47,213,022.64 All other, N. S 133,280,937.08 Total bills discounted. 180,664,291.87 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

440 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. SCHEDULE 13.—Comparative statement of the Federal Reserve agent's accounts. Dec. 31, 1918. Dec. 31, 1917. Dec. 30, 1916. EESOURCES. Federal Reserve notes on hand $17,640,000.00 $10,160,000 $7,260,000 241,870, 745.00 97,325,755 17,069,590 Federal Reserve notes sent to Comptroller of Currency for destruction 64,909,255.00 17,994,245 6,150,410 Bills to secure Federal Reserve notes 159,787,037.99 34,855,506 1,300,000 Funds to redeem Federal Reserve notes: Gold coin and certificates on hand 4,220,000 3,730,000 Lawful money on hand G old redemption fund 13,296,465.0u 4,966,755 859 590 Gold with Federal Reserve Board 72,286,780.00 54, 759,000 11,180,000 Total 85,583, 245.00 63,945, 755 15,769,590 Total resources 569, 790,282.99 224,281,261 47,549,500 LIABILITIES. Federal Reserve notes received from the Comptroller of the 324,420,000.00 125,480,000 30,480,000 85,583,245.00 34,855,506 1,300,000 159,787,037.99 63, 945, 755 15,769,590 Total liabilities 569, 790,282.99 224,281,261 47,549,500 SCHEDULE 14.—Federal Reserve notes issued and in actual circulation. Held by Iii actual circulation at O in u g ts at t a b n e d d Is u s r u in e g d Re i O ng u t a s t t a e n n d d F se e r d v e e r a B l a R n e k end of month. ginning of month. deemed. of month. at end of month. month. 1918 1917 January $97,325, 755 $2,640,000 $2,776,680 $97,189,075 $5,185, 420 $92,003,655 $16,087,095 97,189,075 13,600,000 2,696,470 108,092,605 3,873,545 104,219,060 2J, 849,495 108,092,605 15,800,000 2,221,875 121,670,730 6,359,360 115,311,370 24,337,435 April... 121,670,730 9,900,000 2,108,635 129,464,095 7,649,647 121, 814, 448 29,097,125 129,464,095 19,200,000 4,185,105 144,478,990 10,019, 565 134, 459, 425 33,179,915 June 144,478,990 IS, 740,000 4,817,200 158,401, 790 10,755, 755 147,646; 035 39, 888, 820 July 158, 401, 790 2.), 500,000 3, 734,900 175,166,890 10,419, 305 164, 747, 585 41,351,040 August 175,166,890 28, 420,000 5,304,140 198,282, 750 12,688,355 185, 594,395 43,202, 660 198,282, 750 15, 460,000 3,216,000 210,526,750 10,100, 720 200, 426,030 51,026,510 October 210,526, 750 24, 260,000 3,043,800 231,742,950 15,617,340 216,125,610 61,113,105 231, 742,950 6,420,000 4,330,210 233,832,740 7,141,825 226,690,915 78, 424,400 233,832, 740 16,520,000 8, 481,995 241,870,745 12, 758, 740 229,112,00f 92,977,165 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 3—PHILADELPHIA. 441 SCHEDULE 14A. FEDERAL RESERVE NOTES OUTSTANDING FEDERAL RESERVE DANK OP PHILADELPHIA j [MILLIONS 1917 i9ia MILLIONS 1 OF J P M A ft J J A 3 0 N D J p ft A M J J A 5 0 M D 1 D OL -O LA P R S S j [DOLLARS j 240 240 J 220 220 200 200 I 180 180 J 160 160 J 140 140 120 120 100 100 I 80 80 1 60 60 J 40 40 J I 20 20 j ' u~-™ Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

442 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. SCHEDULE 15.—Denominations of Federal Reserve notes issued during 1918. ' Total. Fives. Tens. Twenties. Fifties. Hundreds. 1918 1917 $240,000 $2,000,000 $400,000 $2,640,000 February $440,000 6,280,000 6,480,000 400,000 13,600,000 $6,060,000 March 1,640,000 4,400,000 7,360,000 1,200,000 $1,200,000 15,800,000 4,040,000 April 900,000 3,000,000 5,200,000 400,000 400,000 9,900,000 5,280,000 Mav 3,680,000 6,400,000 7,520,000 1,200,000 400,000 19,200,000 4,400,000 June.... 3,180,000 4,200,000 9,760,000 800,000 800,000 18,740,000 8,400,000 July 4,380,000 5,520,000 10,000,000 600,000 20,500,000 1,000,000 August 4,700,000 8,120,000 11.600,000 3,200,000 800,000 28,420,000 4,100,000 September 3,020,000 5,680,000 5,360,000 1,000,000 400,000 15,460,000 10,700,000 October 2,500,000 4,680,000 14,080,000 1,800,000 1,200,000 24,260,000 14,700,000 740,000 1,320,000 3,360,000 600,000 400,000 6,420,000 17,000,000 December 4,520,000 4,120,000 6,880,000 1,000,000 16,520,000 17,920,000 Total 29,700,000 53,960,000 89,600,000 12,600,000 5,600,000 191,460,000 93,600,000 SCHEDULE 16.—Interdistrict movement of notes. Received Returned Received Returned from. to. from. to. B os ton ... $1,734,700 $2,101,400 Minneapolis $150,000 $418,000 New York 26,000,590 41,454,750 Kansas City 106,050 655,250 4,465,900 7,037,500 Dallas 393,300 307,150 3,281,000 4,728,250 San Francisco 195,530 533,260 976,740 1,402,100 1,575,500 3,061,500 Total, 1918 39,531,305 62,3.54,660 651,995 655,500 Total, 1917 8,006,790 14,960,902 SCHEDULE 17.—Federal Reserve hank notes issued and in actual circulation. g O in i m u n g t n o a s i n t t n a t g b h n e . d o f m d Is u o s r n u in e th d g . Redeemed. i O o n f g u m t a s t o t a n e n t n d h d . H b m e a e n o n l d d n k t o b a h f y . t c a I i t m n r c e o u a n n c la d t t u t h i a . o o l n f August $800,000 $800,000 $448,322 $351,678 September. $800,000 1,828,000 2,628,000 429,784 2,198,216 October 2,628,000 1,096,000 $1,200 3,722,800 190,358 3,532,442 November. 3,728,800 2,117,000 23,800 5,816,000 271,140 5,544,860 December.. 5,816,000 3,564,000 121,800 9,258,200 332,037 8,926,163 SCHEDULE 18.—Federal Reserve hank notes issued. One dollar. Two dollar. Five dollar. Total. August •. $800,000 $800,000 1,288,000 $200,000 $340,000 1,828,000 872,000 224,000 1,096,000 1,436,000 230,000 401,000 2,117,000 1,964,000 440,000 1,160,000 3,564,000 Total 6,360,000 1,144,000 1,901,000 '9,405,000 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 3—PHILADELPHIA. 443 SCHEDULE 19. — Votes cast for class A end B directors. First Second Third Fourth Fifth Candidates, choice. choice. choice. choice. choice. GROUP 2, CLASS A. John Barbey, president, Keystone National Bank, Reading, Pa 7 15 31 David Barry, cashier First National Bank, Johns town, Pa 5 21 23 Francis Douglas, cashier First National Bank, Wilkes- Barre, Pa 82 24 5 Montgomery Evans, president Norristown Trust Co., Norristown, Pa 22 44 18 Frank Hastings, president Second National Bank, Altoona, Pa 7 13 30 GBOUP 3, CLASS B. Charles K. Haddon, vice president Victor Talking Machine Co., Camden, N.J 12 Elmer E. Low, farmer, Lime Ridge, Pa 14 John C. Ogden, superintendent Cambria Steel Co.. Johnstown, Pa Henry W. Stokes, manufacturer, Philadelphia, Pa... 7 E. H. Zeigler, farmer, Madisonburg, Pa 89 SCHEDULE 20.—Gold settlement fund operationsfor 10 IS. Total debits. Total credits. Ne m t o ga n i t n h f . or Ne m t o lo n s t s h f . or Ba c la lo n s c e e . at $415,180,000.00 $398,545,000.00 '$16,635,000.00 $48,736,000.00 February 315,386,000.00 317,496,000.00 $2,110,000.00 46,626,000.00 March 355,155,000.00 350,796,000.00 4,359,00(3.00 50,985,000,00 April 381,900,000.00 395,872,000.00 13,972,000.00 37,013,000.00 Mav 501,538,000.00 486,382,000.00 15,156,000.00 52,169,000.00 June 392,768,150.00 396,833,750.00 4,065,000.00 48,103,400.00 Julv 482,715,084.04 430,182,928.90 2,532,155.44 50,635,555.14 August 445,511,503.93 441,633,156.58 54,513,902.49 419,890,371.99 401,108,491.94 18,781,880.05 73,295,782 54 October 582,848,438.89 613,455,461.56 30,607,022.67 42,688 759 87 November 559,740,694.24 561,393,246.55 1,652,552.31 41,036,207! 56 December 587,504,336.75 591,128,137.77 3,623,801.02 37,412,406.54 Total 5,440,137,579.84 5,434,826,173.30 61,342,382.54 56,030,976.00 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

444 ANNUAL REPORT OE THE FEDERAL RESERVE BOARD. SCHEDULE 20A. j GOLD SETTLEMENT FUND OPERATIONS 1 PED&RAL RESERVE BANK OF* PHILADELPHIA | MILLIONS j 1917 1 1918 [MILLIONS! 1 OF OF 1 fDOLLARS |'J |P|f\|A|JA|j|j|A|S|0|N|D |J |P|M|A|AV|J|J|A|S|0|AI|D DOLLARS I 1 1 1 1 1 1 I II 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 70 70 J 60 60 50 1 1 50 j 40 40 J J 30 ; so I V' J 20 20 J 10 1 10 I ±0 o4 10 1 10 20 J £0 30 30 1 •1 Losses E223 GAINS Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 3 PHILADELPHIA. 445 SCHEDULE 21.—Check clearing and collection. AVERAGE DAILY NUMBER AND AMOUNT OF CHECKS HANDLED. On Philadelphia On banks else On banks in other banks. where in district. reserve districts. Num Num Num Num ber. ber. Amount. ber. Amount. ber. Amount. 1918. January 14,057 I$1S, 783,831 24,115 $3,563,853 11,672 $12,556,526 49,844 $34,904,210 February 14,924 15,903,733 20,952 1 2,990,444 10,880 10,812,264 46,756 29,706,441 March 14,572 17,123,767 22,686 3,189,916 11,199 11,450,111 48,457 31,763,794 April 14,356 17,086,630 19,690 3,052,656 10,641 7,393,766 44,687 27,533,052 May 13,347 22,216,373 23,990 3,953,230 12,154 12,379,149 49,491 38,548,752 June 11,354 22,021,806 26,928 4,453,483 13,494 11,860,297 51,776 38,335,586 July 10,199 23,748,311 34,570 4,320,728 16,254 12,081,782 61,023 40,150,821 August 9,867 20,331,686 29,856 4,138,372 14,858 10,252,070 54,581 34,722,128 September 11,356 23,604,779 32,149 4,635,734 15,798 11,201,015 59,303 39,441,528 October 17,134 27, 768,625 32,532 5,164,894 16,808 12,938,592 66,474 45,872,111 November 17,668 28,833,029 33,182 5,216,339 17,503 11,278,488 68,353 45,327,856 December 21,219 27,723,766 40,851 5,670,185 20,461, 10,299,623 82,531 43,693,574 Average 14,171 22,095,528 28,458 4,195,819 14,310 11,208,j640 56,939 •37,499, < Average for 191 12,087 12,273,306 17,674 2,581,355 7,481 8,825,030 37,603 23,679,< TOTAL NUMBER AND AMOUNT OF CHECKS HANDLED MONTHLY. On Philadelphia On banks elsewhere On banks in other Total. banks. in district. reserve districts. Number. Amount. Number. Amount. Number. Amount. Number. Amount. 1918. January 373,263 $444,252,374 511,935 $79,369,064 276,667 1192,237,928 1,161,865 $715,859,366 328,332 349,882,128 460,945 65,789,777 239,359 237,869,807 1,028,636 653,541,712 March 364,293 428,094,175 567,149 79,747,911 279,990 286,252,776 1,211,432 794,094,862 April 365,502 488,379,621 626,986 92,660,184 303,473 326,469,658 1,295,961 907,509,463 May 347,022 577,625,699 623,739 102,783,982 316,010 321,857,862 1,286,771 1,002,267,543 June 283.843 550,545,153 673,199 111,337,087 337,368 296,507,430 1,294,410 958,389,670 July 254,971 593,707,781 864,251 108,018,187 406,358 302,044,570 1,525,580 1,003,770,538 August 266,422 548,955,519 806,120 111,736,048 401,163 276,805,911 1,473,705 937,497,478 September 272,536 566,514,715 771,587 111,257,607 379,172 268,824,350 1,423,295 946,596,672 445,482 721,984,258 845,819 134,287,251 437,031 336,403,397 1,728,332 1,192,674,906 November 424,030 691,992,700 796,373 125,192,142 420,082 270,683,703 1,640,485 1,087,868,545 530,471 693,094,152 1,021,290 141,754,639 511,528 257,490,566 2,063,289 1,092,339,357 Total, 1918. 4,256,167 6,655,028,275 8,569,393 1,263,933,879 4,308,201 3,373,447,958 17,133,761 11,292,410,112 Total, 1917. 3,648,181 3,704,029,949 5,339,710 778,780,708 2,364,381 2,663,681,129 11,352,272 7,146,491,786 Disbursements, transit department $167,520 Cost per item cents.. 0.97 Cost per $1,000 do.. 1.48 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

446 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. SCHEDULE 21A. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT No. 3 PHILADELPHIA. 447 SCHEDULE 22.—Banking resources, district No. S. [000 omitted.] Total resources. Undi Indi Bank Capital. Surplus. vided vidual deposits. profits. deposits. 1918 1917 Pennsylvania: 174,474 $94,853 $24,998 $817,442 $162,455 $1,293,164 $1,209,999 81,113 115,572 28,213 823,516 j 14,090 1,113,693 981,001 Total (890) 155,587 j 210,425 53,211 1,640,958 1 176.545 2,406,857 2,191,000 New Jersey: 6,295 7,177 3,210 58,754 1,637 128,256 109,515 5,640 j 5,064 1,702 64,473 5,386 80,544 71,563 Total (114) 11.935 i 12,241 4,912 123,328 7,023 208,800 181,078 Delaware: National banks (20) 1,459 1,542 700 14,063 542 20,229 19,297 3,396 | 2,034 1,106 30,747 545 66,306 56,041 Total (45) 4,855 < 3,576 j 1,806 44,810 1,087 86,535 75,338 Totals: National banks (629) 76,228 1 103,571 : 28,908 906,943 164,629 1,441,649 1,338,811 90,150 1 122,671 31.022 918,737 20,022 1,260,544 1,108,664 Total (1,049), 1918. 166,378 j 226,242 59.930 1,825,680. 184,651 2,702,193 Total (997), 1917 159,422 204. HI 7 78.51fi 1,589,826 238,775 2,447,474 SCHEDULE 23.—Combined statement of condition of member national banks. Date of comptroller's call. Sept. 2, 1915 Sept. 12, 1916. Sept. 11, 1917. Aug. 31, 1918. RESOURCES. Loans and discounts $527,799,000 $597,371,000 $647,542,000 $635,753,000 Liberty bonds 23,903,000 66,791,000 Other United States bonds.. 61,438,000 58,812,000 67,804,000 142,412,000 Other bonds, securities, etc.. 198,582,000 244, 462,000 283,356,000 271,998,000 All other resources 267,289,000 295,338,000 316,206,000 323,395,000 Total. 1,055,108,000 1,195,983,000 j 1,338,811,000 1,440,349,000 LIABILITIES. Capital stock 77,248,000 76,814,000 76,708,000 76,178,000 Surplus 98,150,000 97,304,000 99,037,000 103,468,000 Undivided profits 21,100,000 24,460,000 28,766,000 28,908,000 National-bank notes outstanding.. 58,278,000 56,291,000 55,596,000 54,212,000 Individual deposits 640,860,000 759,894,000 877,549,000 905,834,000 Bank deposits 149,604,000 166,926,000 166,175,000 164,629,000 All other liabilities 9,868,000 14,294,000 34,980,000 107,120,000 Total. 1,055,108,000 1,195,983,000 : 1,338,811,000 1,440,349,000 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

448 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. SCHEDULE 24.—State banks and trust companies in the Third Federal Reserve District admitted to membership in the Federal Reserve system. Name of bank. Capital. Surplus. Deposits.^ 1. Girard Trust Co., Philadelphia, Pa 1,500,000 17,500,000 $37,423, 775.82 2. Miners Deposit Bank, Lykens, Pa 50,000 110,000 484, 000.00 3. Philadelphia Trust Co., Philadelphia, Pa 000,000 4,000,000 23,731, 531.48 4. Commercial Trust Co., Philadelphia, Pa 000,000 1,750,000 14,035, 264.64 5. Camden Safe Deposit & Trust Co., Camden, N.J 500,000 800,000 8,599, 346.84 6. Wilmington Trust Co., Wilmington, Del 000,000 500,000 13,527, 713.10 7. Pennsylvania Co., Philadelphia, Pa 000,000 5,000,000 25,434, 553.61 8. Fidelity Trust Co., Philadelphia, Pa 000,000 16,000,000 22,515, 615.07 9. Dime Deposit Bank, Wilkes-Barre, Pa 200,000 150,000 1,371, 346.36 10. Security Trust & Safe Deposit Co., Wilmington, Del... 600,000 700,000 4,410, 486.64 11. Markle Banking & Trust Co., Hazleton, Pa 100,000 500,000 3,437, 176.86 12. Rittenhouse Trust Co., Philadelphia, Pa 250,000 50,000 1,426, 965.39 13. Cambridge Trust Co., Chester, Fa 250,000 125,000 5,137, 308.15 14. Williams Valley Bank, Williamstown, Pa 50,000 45,000 302; 058.38 15. Dauphin Deposit Trust Co., Harrisburg, Pa 300,000 300,000 3,188, 925.85 16. Gloucester City Trust Co., Gloucester City, N.J 100,000 25,000 548, 816.56 17. Provident Life & Trust Co., Philadelphia, Pa ,000.000 5,000,000 10,271 978.37 18. Princeton Bank & Trust Co., Princeton, N.J 100,000 150,000 1,428, 965.39 19. B,ank of Commerce, Philadelphia, Pa 300,000 140,000 1,640. 000.36 20. West Philadelphia Title & Trust Co., Philadelphia, Pa 500,000 500,000 4,154! 985.28 21. Colonial Tr^st Co., Philadelphia, Pa 272,725 272,725 2,910; 197.41 22. American Bank of Commerce, Scranton, Pa 312,987 34,480 378, 027.41 23. Equitable Trust Co., Wilmington, Del 500,000 500,000 3,693, 216.23 24. Drovers & Merchants Bank, Philadelphia, Pa 200,000 40,000 540, 986.29 25. Swedesboro Trust Co., Swedesboro, N.J 100,000 20,000 615, 174.43 26. Northern Central Trust Co., Williamsport, Pa 500,000 150,000 2,631 339.68 27. Susquehanna Trust Co., Williamsport, Pa 400,000 300,000 2,029, 433.60 28. Logan Trust Co., Philadelphia, Pa ,000,000 250,000 7,509, 445.22 29. Wayne County Savings Bank, Honesdale, Pa 200,000 325,000 2,663, 000.00 i Exclusive of Government deposits. SCHEDULE 25.—Philadelphia clearing-house members, 1918. [000 omitted.] Loans, dis Deposits. Ratio counts, of loans [and invest to ments. Bank, j Individual. Total deposits. Per cent. January... $579,246 $164,861 $456, $621,667 93.2 February.. 578,976 167,232 448, 615,986 94.0 March 587,344 169,717 450, 620,551 94.7 April 606,940 166,408 467, 633,937 95.7 May 619, 773 164,976 463, 628,708 98.6 June 623,872 170,239 454, 624,756 99.8 July 611,044 155,531 439, 595,314 102.7 August — 613,842 166,494 451, 617,638 99.4 September. 630,491 168,869 474, 643,445 98.0 October... 716,478 167, 562 461, 628,637 113.9 November. 743,957 159,022 479, 638,627 116.5 December. 713,802 159, Cro 464, 619,645 115.1 SCHEDULE 26.—Subscriptions to the four Liberty loan issues. FIRST LOAN. Per cent of Per States. Ap m po e r n t t i . o n su A b m sc o ri u b n e t d . Allotments. s N ub u s m cr b i e b r e r o s f . p s o u p b u s l c a r t i i b o n su ca b p sc it r a i p ing. tion. Delaware $6,136,000 $11,917,850 $6,136,100 No record. No record. $50.00 New Jersey 8,817,400 11,702,700 8,812,100 No record. No record. 17.60 Philadelphia 94,964,750 145,172,950 96,809,650 No record. No record. 80.50 Pennsylvania (not including Philadelphia) 53,339,150 63,515,750 53,389,750 No record. No record. 16.70 163,257,300 232,309,250 165,147,600 35.70 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 3—PHILADELPHIA. 449 SCHEDULE 26.—Subscriptions to the four Liberty loan issues—Continued. SECOND LOAN. Per cent of Per Apportion Amount Number of population capita States. ment. subscribed. subscribers. subscrib subscrip ing. tion. Delaware $7,705,700 $8,314,200 $7,705,700 16,570 $35.00 New Jersey 17,527,950 18,188,150 16,950,400 52,849 7.9 27.30 Philadelphia 139,499,950 234,901,000 148,327,350 245,123 13.6 130.00 Pennsylvania (not including Philadelphia) 108,067,200 118,946,900 107,200,650 309,033 7.9 31.40 272,800,800 380,350,250 280,184,100 623,575 9.6 58.50 THIRD LOAN. Delaware $8,474,500 $25,391,400 $25,391,400 50,873 21.3 $94.00 New Jersey 19,379,400 24,990,850 24,990,850 164,573 24.7 37.40 Philadelphia 139,499,950 142,230,650 142,230,650 651,931 36.2 93.00 Pennsylvania (not including Philadelphia) 101,587,640 169,350,600 169,350,600 1,003,551 26.4 37.00 268,941,490 361,963,500 361,963,500 1,870,928 54.50 FOURTH LOAN. Delaware $16,013,280 $22,621,300 $22,621,300 58,647 24.6 $95.50 New Jersey 38,694,970 42,363,450 42,363,450 206,516 31.2 63. 50 Philadelphia 259,198,000 306,870,950 306,870,950 502,700 27.8 167.00 Pennsylvania (not including Philadelphia) 202,000,000 226,907,950 226,907,950 1,003,268 26.5 59.50 515,906,250 598,763,650 598,763,650 1,771,131 27.3 92.00 SCHEDULE 27.—Number of banks and of other subscribers, also amounts subscribed to certificates of indebtedness. Six issues Seven issues preceding the preceding the third Liberty fourth Liberty loan. loan. National banks: Number subscribing , 578 601 Per cent of total in district 90.31 93.18 Amount subscribed $123,319,500 $200,957,500 State banks: Number subscribing 147 Per cent of total in district 86.98 Amount subscribed $15,188,500 Trust companies: Number subscribing 200 202 Per cent of total in district 68.26 87.44 Amount subscribed • $61,990,000 $93,859,000 Other banks: Number subscribing 118 9 Per cent of total in district 45.56 100 Amount subscribed $8,685,000 $5,129,000 Individuals,corporations, etc.: Number subscribing 148 33 Amount subscribed $2,505,500 $886,000 Total: Number of banks subscribing 959 Per cent of total in district 75.17 90.99 Number of individuals, corporations, etc., subscribing.. 148 33 Amount subscribed $196,500,000 $316,020,000 100823°—19- -29 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

450 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. SCHEDULE 28. BANK CLEARIMGS 1 PHILADELPHIA FEDERAL RESERVE.'DISTRICT JAN |FEb|AAR|APR | WAY |JUN E| JULY |AUG|5ePT|0CT |N0Y |DEC | \% 2,400,000,000 2 200,000,000 2,000,000,000 IS 1,800,000,000 1,600,000,000 *-* /**>*. ^ -i-- \\ // \ 1,400.000.000 1,200,000,000 •-•••' •••••• '**•» ..»-* 1,000,000,000 800,000,000 ^-^ / >s ^ 600,000,000 400,000,000 200,000,000 L N 18 s / k \ / V **^ -*•«" / / 9V£, / y •**•». s J tt t 1 916 t ***«•«• / t •••••^i / / 19 15- S " U4U WJJPMJUU M3r—mm*m^—m—mmmmmmmmmm—mmmmmmmmmmimmmmmmmm*mm—mmMmmmmmmmmmm—mmmm*mmm—mmA 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. RESULTS OF OPERATION. Gross earnings of the Federal Reserve Bank of Cleveland during the year just past have amounted to $5,226,000, or more than $100,000 per week. The expenses, including expense of branches, this district's proportion of Federal Reserve Board expense, cost of Federal Reserve currency, and all items of equipment (which have been charged uniformly to current expense) have been a little less than $1,000,000. On June 1 a dividend was paid for the period beginning July 1, 1917, to date, thus completing the payment of all accumulated dividends, and the regular dividend was paid on Decem ber 31. After setting aside a reserve sufficient to meet all deprecia tion of assets, the sum of $1,776,000 was transferred to surplus account, and a like amount reserved for the payment of franchise tax provided for in the Federal Reserve Act. Schedule 1, appended hereto, shows the balance sheet for December 31, 1918, with comparative figures for December 31, 1917. Schedule 2 shows the principal charges and credits to profit and loss account for 1918 as compared with 1917. Schedule 3 shows the gross earnings classified according to principal sources of revenue by months, together with the expenses and net earnings, and the same data appear in graphic form in chart 1. Schedule 4 shows the daily average of earning assets divided into the principal sources of revenue, with the total earnings and the average rate on each principal class of investments, and also the rate of gross and net earnings to daily average capital for the years 1918 and 1917, respectively. Schedule 5 shows the total volume of loans, discounts, and invest ments, divided into principal classifications, for the year 1918 as compared with 1917. GENERAL BUSINESS AND BANKING CONDITIONS. At the beginning of the year the transition of business from a peace to a war basis had not been accomplished, and it was not fully realized that all energies must, of necessity, be devoted to the pro- 451 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

452 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. duction of war materials and the accessories necessary to the most intensive waging of war. The rapid growth of a genuine patriotic desire to cooperate in the policies agreed upon at Washington and the official embargoes and curtailment of supplies operated to hasten the readjustment, so that by April 1 the business of the district was on a war basis. Despite shortage of transportation, coal shortage, closing orders, capital restrictions, weather unprecedented in its severity, and an epidemic which would have produced at least a partial paralysis even in normal times, the volume of business, gauged not only by the changing standard of money value, but in many instances by tonnage and number of articles, has exceeded all previous records. Exceptions were only in restricted lines and not of sufficient conse quence to change the very satisfactory result. This district, while noted for its manufactures, is probably exceeded by few others in the amount and value of its agricultural products. The crops have generally exceeded the average, the acreage has been large, farms are well stocked, and there has been an entire freedom from the epidemics to which stock is oftentimes subject. In view of the high prices, the farmer has been very prosperous. Labor has been scarce and at times inclined to be exacting. The scarcity, which gave concern to employers and at times seemed as if it would be very serious, did not, however, obtain to such an extent as materially to decrease production. It was overcome largely by the employment of women and a proper distribution. In many lines wages reached record heights, and there was employment for every one. There has been a continuous and strong demand for money, both investment and short time, with a slight easing of the latter in Decem ber by reason of the hesitation in business due to the signing of the armistice. The ruling rate of 6 per cent held firm till well along in the year, when with the approach of the fourth Liberty loan there were some advances, mainly in the rural districts. DISCOUNT OPERATIONS. While the Federal Reserve Bank of Cleveland has maintained a very strong reserve position during the entire year, this bank, with the others, has been called upon for a volume of rediscounts which presents a rather startling contrast to the figures for 1917. The num ber of applications handled during the present year was 5,714, as against 1,206 for 1917. The number of member banks accommo dated is exactly twice the total number for the previous year. The total rediscounts and loans were in excess of $1,386,000,000, as against $212,000,000 for 1917. Of this amount, $988,000,000 were discounts of member banks' collateral notes secured by United Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 4—CLEVELAND. 453 States securities, and $72,000,000 were rediscounts of notes to member banks secured by United States securities. This total of $1,060,- 000,000 is large in comparison with the $326,000,000 of rediscounts of commercial and agricultural paper. It must be borne in mind, however, that member banks prefer to use their own collateral notes secured by Liberty loan bonds or Treasury certificates of indebted ness, or to rediscount paper similarly secured, both on account of the simpler procedure and the lower rate, so that it is certain that the proportion borne by the one class of paper to the other on our books does not represent the true proportion of the two classes of demands upon the member banks. Nearly $25,000,000 of trade acceptances were rediscounted for our member banks during the year, almost 8 per cent of the total of rediscounts of commercial, agricultural, and industrial paper. While this is but a beginning, the proportion is (somewhat to our gratifica tion) larger in this bank than in any other of the Federal Reserve Banks, and is one of many indications that the trade acceptance system is growing in popularity, if not in proportion to its merits, at least so markedly as to indicate that it will come generally into vogue much sooner than could have been expected. One of the outstand ing features of the development of the trade acceptance system in this district and elsewhere has been the adoption of the system by a number of iron and coal producers. A meeting of the Lake Superior Iron Ore Association which will take place in the near future is expected to result in the further adoption of the system in connection with iron ore contracts by several if not all of the leaders in that great basic industry. Schedule 6 is a tabular statement of the rediscount transactions of the year. ACCEPTANCES. The open-market purchase of bills of exchange (chiefly bankers' acceptances) has been a feature of the year. A considerable number of banks of this district have adopted a progressive policy, both in making their own acceptances and in purchasing acceptances of other banks. Of our total purchases in 1918, of more than $175,- 000,000, nearly $52,000,000, or approximately 30 per cent, were pur chased from member banks in district No. 4. In view of the fact that this bank has, during most of the year, participated to the extent of 10 per cent in the open-market purchases of the Federal Reserve Bank of New York, this showing of the banks of this district is very creditable, particularly when it is added that no inconsiderable pro portion of the bills shared by us with the New York bank likewise represents acceptances of member banks in this district. The great value of acceptances as a secondary reserve is beginning to be recog nized, and the development of the market is such that the instant Digitized folri qFRuAidSiEtyR of such paper is beginning to be lealized. http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

454 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. During the year the following banks have been granted permission to accept up to 100 per cent of their capital and surplus: Union Commerce National Bank, Cleveland, Ohio. Superior Savings & Trust Co., Cleveland, Ohio. Bank of Pittsburgh, N. A., Pittsburgh, Pa. First National Bank, Pittsburgh, Pa. Pittsburgh Trust Co., Pittsburgh, Pa. Mellon National Bank, Pittsburgh, Pa. The Federal Reserve Bank of Cleveland in its open-market pur chases has consistently discriminated in favor of indorsed bills, which are always purchased at a lower rate than acceptances which have been discounted by the accepting bank. While it has seemed unwise to refuse absolutely the purchase of such acceptances, in view of the fact that the open market was hot readily available to some accepting banks in the smaller cities of this district, as time goes on the development of the open market will doubtless permit this bank to do more than merely to discourage such transactions by a differential rate, without the hardship that such course would now work upon some of the accepting banks. Early in December a conference of the accepting banks in the district was held at Cleveland, at which Mr. E. R. Kenzel, manager of investments of the Federal Reserve Bank of New York, outlined the general principles of open-market transactions. Schedule 7 is a summary of the open-market transactions of the year. In the early part of the year a number of transactions appearing on the books as purchases of United States Treasury certificates of indebtedness represented purchases made under a resale agreement, and took the place of member bank collateral loans. This practice was discontinued in April. Other similar transactions have con sisted practically entirely of certificates maturing within 15 to 30 days of the date of our purchase. Schedule 8 shows the total of the purchases of Government securi ties during the year. RESERVE POSITION. The reserve position of the bank has been exceptionally strong during all of the year, the combined reserve against net deposit liabilities and Federal Reserve notes having dropped below 50 per cent on only two occasions despite the fact that frequent rediscounts have been made for other Federal Reserve Banks in whose districts loan demands had been relatively greater than in ours, and in several instances considerable blocks of bankers' bills have been purchased from other Federal Reserve Banks in lieu of rediscounts. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 4 CLEVELAND. 455 MOVEMENT OF MEMBERSHIP. Eight national banks in this district have gone out of existence during the year, of which two consolidated, two were absorbed by other national banks, one was absorbed by a State bank member of the Federal Keserve system, one was succeeded by a State bank which took over the national bank charter, and two were succeeded by State banks. There have been five new national bank members, of which one was the result of the consolidation above referred to. Fifty-three State banks and trust companies in this district were admitted to membership during the year. The net result was an increase in the membership of 50 baiiks, the total number of members on December 31, 1918, being 814. A tabular statement of the changes in membership is appended as Schedule 9. While the advantages of membership, both for eligible banks them selves, and for the strengthening of the general financial and economic situation as well as for patriotic considerations, have impressed themselves repeatedly upon nonmember banks during the year, it is of course necessary to secure personal contact in order to bring to a head applications for membership. The Federal Reserve Bank of Cleveland has persistently cultivated such contacts during the year, not only through the activities of the Federal Reserve agent and his assistant as well as other officers, but also through the work of the 30 "field agents" of the central Liberty loan committee who, in the intervals between Liberty loans and offerings of Treasury certifi cates, have been intensively schooled in the matters connected with membership in the system, and have secured a number of applica tions. (See Schedule 10.) RELATIONS WITH NATIONAL BANK MEMBERS. Naturally the very large majority of rediscount transactions have been for national bank members, although a considerable proportion of the total volume has been for State bank members, largely for carrying Government securities. About 80 per cent, however, of the total volume was for national banks. A list of the national banks which have been granted fiduciary powers under section 11 (k) of the Federal Reserve Act is appended as Schedule 11, which shows the powers granted in each case. The increasing cordiality of our relationship with national bank members makes it difficult to realize at times that a considerable degree of irritation, doubtless the result of the " enforced" member ship rather than logical objection to the essentials of the Federal Reserve system, was to be seriously reckoned with during the early years of our work. While there are still rare cases of persistence of this feeling, the strength and capacity of the system have been dem- Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

456 ANNUAL KEPORT OE THE FEDERAL RESERVE BOARD. onstrated so indubitably during the past year, and its aid has been so essential and so well rendered, that ungrudging appreciation is ex pressed by the vast majority of the original members of the system in this district as elsewhere. RELATIONS WITH STATE BANKS AND TRUST COMPANIES. The discount operations for State banks and trust companies, amounting to $270,000,000, or approximately 20 per cent of the total, have been, as above stated, very largely for carrying Liberty loan and Treasury certificate subscriptions. The total number of State bank members in the district is but 8 per cent of our member ship, but this number includes the largest of such institutions. Some of these have, of course, expanded their commercial activities partly as a result of their membership, and in a few instances the State bank members have been notably active in the acceptance field, so that the open-market transactions have included considerable purchase of acceptances from such members. The Federal Reserve Bank of Cleveland has not yet participated in examinations of the State bank members, the examinations of the State departments being of a high grade and quite satisfactory. With the new year it is the intention to establish a small staff of examiners who will join with the State examiners at the time of making their examinations. FISCAL AGENCY OPERATIONS. An adequate account of the campaigns for the third and fourth Liberty loans and the sales of Treasury certificates is impossible in the space which can reasonably be occupied by this report. While the experience of each campaign has led to perfecting details of the scheme of organization, in the main the fundamentals of the organization have remained as for the earlier loans, an account of which appeared in last year's report, and the personnel has been changed but little, except that throughout the local committees there has been a constant increase in both number and efficiency of workers. Under the plan of allotment of Treasury certificates of indebtedness adopted by the Secretary of the Treasury, an organization was per fected in this district for the series offered in anticipation of the fourth Liberty loan under the direction of Mr. E. S. Burke, jr., a business man and capitalist of Cleveland, who devoted his energies unceasingly to the task. Under his direction the 30 field agents of the central Liberty loan committee covered the banks of the district outside of the principal centers with personal visits. The results are represented in the several tables marked Schedule 12, appended Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT IsTO. 4 CLEVELAND. 457 hereto, and the figures therein will tell the story more adequately than words. Through the procedure for the qualification of depositaries of war loan funds, a very large proportion of the payments for both certifi cates of indebtedness and Liberty loan bonds were, in effect, distrib uted over a longer period for qualified banks. A detailed report of these transactions would be profitless, but in the tables appended hereto a sufficient record will appear, especially in tables included under Schedule 13. The task of handling depositary transactions and the withdrawal of funds as needed has kept a considerable depart ment of the bank fully occupied. It will be noted that the collateral value of securities pledged was at all times very largely in excess of the total deposits, and that more than one-third of the total par value of securities pledged consisted of United States bonds and Treasury certificates at the close of the year; approximately the same proportion obtained during the entire year. The total volume of transactions during the year was not far from $3,000,000,000, while the high point of deposits, reached on October 28, was $189,000,000. In this connection it may be noted that one-third of all the Treasury certificates find their way into the hands of the custodies department of this bank when issued, for the most part pledged as collateral to secure Government deposits, but, to some extent, left by the owners for safe-keeping. * The flotation of the Liberty loans has been above referred to in general terms. Analyses of the subscriptions and payments appear in the tables appended hereto, marked Schedules 14 and 15. The Federal Reserve Bank of Cleveland feels that it may congratulate itself on having handled through its Liberty loan or fiscal agency departments, with a modest staff, not only the subscriptions and pay ments, but the deliveries, conversions, and exchanges of the third and fourth loans and the various issues of Treasury certificates with all possible dispatch and with a minimum of errors. The tremendous number of small bonds required by subscribers, far exceeding the largest estimates, involved a delay in production of the bonds them selves at Washington, which was inevitable, but delays at this bank and its branches were, fortunately, negligible; and it is well known that conditions at Washington and throughout the Federal Reserve Banks improved with each loan, in spite of the tremendous difficul ties, and in the fourth loan in spite of the influenza epidemic. While during the greater part of the year the Federal Reserve Banks were asked to assume no responsibilities in campaigns for war-savings certificates and thrift stamps, it was the pleasure of this bank to assist in every possible way in the disposition of these securities. The banks and other agents in the State of Ohio and that part of western Pennsylvania included in district No. 4 were supplied Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

458 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. through this bank, except in so far as they preferred to make pur-1 chases through the post office; and when late in the year the super vision of sales was definitely placed in the Federal Reserve Banks, the same territory was assigned to this bank, all of Kentucky and West Virginia being retained under the supervision of the eighth and fifth Federal Keserve districts, respectively, as a matter of con venience. (See Schedule 16.) While numerous inquiries concerning the possible aid of the War Finance Corporation originated in this district, the actual number of transactions in which this bank acted as fiscal agent of the cor poration was small. Doubtless, as in many other instances, the mere existence of a resource of this character served a purpose equal to its actual assistance. The work of the capital issues subcommittee for this district, especially during the period from June 1 until the signing of the armistice, was of heavy volume. Besides the chairman and governor of this bank, serving ex officio, the members were: A. E. Adams, president First National Bank, Youngstown, Ohio. W. M. Bell, William Bell & Co., Pittsburgh, Pa. E. H. Cady, president Guardian Trust & Savings Bank, Toledo, Ohio. C. W. Dupuis, vice president Citizens National Bank, Cincinnati, Ohio. J. A. House, president Guardian Savings & Trust Co., Cleveland, Ohio. F. R. Huntington, president Huntington National Bank, Columbus, Ohio. C. N. Manning, president Security Trust Co., Lexington, Ky. H. C. McEldowney, president Union Trust Co., Pittsburgh, Pa. H. B. McGraw, counsel, Cleveland, Ohio. Baird Mitchell, Mitchell & Stevenson (Inc.), Wheeling, W. Va. J. R. Nutt, president Citizens Savings & Trust Co., Cleveland, Ohio. John Sherwin, president First National Bank, Cleveland, Ohio. C. E. Sullivan, vice president Central National Bank, Cleveland, Ohio. 0. B. Wright, president Union Savings Bank & Trust Co., Cincinnati, Ohio. Many projects, both municipal and private, were postponed, as well as much unnecessary use of capital avoided by means of propa ganda work undertaken during the early days of the committee. A representative of the committee was sent to all the large cities in the Fourth Federal Reserve District for the purpose of acquainting bankers, newspapers, investment houses, municipalities, and others with the aims of the committee and for the purpose of enlisting their cooperation. This work bore fruit, and a large number of contem plated projects were postponed until conditions became more nearly normal. The culmination of this propaganda work was a meeting held in the city of Pittsburgh and attended by over 500 bankers and municipal officials, at which the chairman of the district com mittee outlined in detail the policies of the Government as applied to "war business first." Tabular statements showing the work of the committee are appended hereto as Schedule 17. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 4—CLEVELAND. 459 NOTE ISSUES. The issues of Federal Reserve notes by the Federal Reserve Bank of Cleveland have been merely a reflection in this district of condi tions which were nation-wide, and have been fully covered by the Federal Reserve Board in the Federal Reserve Bulletins as well as in its annual report. The same can be said of the issues of Federal Reserve bank notes for the purpose chiefly of replacing silver cer tificates, and greatly needed in this district as elsewhere to supply the demand for currency in the smaller denominations. Schedules 18 and 19 show the operations of this bank in these currency issues. POSITION OF COMMERCIAL BANKS AS A RESULT OF WAR FINANCING. Schedule 20, appended hereto, shows the resources of member banks in November, 1918, as compared with December, 1917. The situation of increased obligations, due chiefly to war financing and the attendant expansion, is not more marked in this district than elsewhere, and the results are, of course, the subject of widespread comment which needs no elaboration here. The effect on the commercial paper market in this district has been, as elsewhere, to produce a greater firmness of rates concurrently with the increased demand. There has been no crippling of essential business but a marked limitation of enterprises not essential to the winning of the war. The natural reaction following the signing of the armistice has produced a tremendous increase in the holiday business of retail establishments, and a disposition to resume full activities as rapidly as possible on the part of many enterprises which have suffered from war conditions. POLICY TO BE PURSUED IN RESTORING LIQUIDITY OF BANKS. In practically every community of district No. 4, with one or two exceptions, the Government securities appear to have been sub scribed almost completely by individuals and corporations, and few subscriptions, comparatively, were made by the banks for their own account. The amount of loans to subscribers for carrying bonds of the fourth Liberty loan, however, is large and it is evident that some of the subscribers intended to carry loans on their bonds for at least a year. Reports indicate, however, that few agreements have been made by banks in the district to carry loans on fourth Liberty loan bonds at the coupon rate for longer than 90 days, and this bank has encouraged the banks of the district in the policy of an increasing rate to stimulate liquidation at as early a date as possible. It is our own policy to accept ordinarily one renewal of a member bank's mxrn ~\&-Afk.TT r»r»llftt,Ar«l rmt.A «Af»nT*Arl Kv Onwrnrnpnl-. uopnrifioa of. tlna Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

460 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. bear the 90-day rate of 4J per cent; and it is the judgment of our directors that with all due liberality of policy, every proper influence should be exerted toward early liquidation. If there is one policy which appears to be unquestionably desirable in the difficult period of readjustment that immediately confronts us, it would seem to be that of encouraging by all possible means the continuation of saving and the thorough absorption of the Government securities, which can not now be said to be fully digested; and it is equally certain that all of the influences that can be brought to bear to that end will be none too potent. OPERATIONS OF FEDERAL RESERVE BANK BRANCHES. The Cincinnati branch began its operations on January 10 and the Pittsburgh branch began its money operations on March 11, following with the assumption of full transit operations on April 22. Member banks in the cities where these branches are located, and their vicinity, have repeatedly expressed their gratification at the results of the oper ations of the branches, which have reduced the time for the collection of checks and facilitated the money and currency operations, as well as the deliveries of United States securities. While no books are kept at the branches (all entries being made on the books of this bank by means of daily transcripts and private telegraph connections) and therefore no discount operations are directly consummated at the branches, discount operations for the banks in the branch cities are nevertheless facilitated; their paper may be presented at the branches, if desired, the proceeds to be credited on our books on the following day as of the day when presented at the branch. With the increasing number of transactions based upon Government securities, it has also been a great convenience to deposit the collateral at the branch bank. In all respects the establishment of our two branches is properly to be regarded as wholly successful and a means of improving markedly the service rendered by this institution to our member banks. The transit operations of the branches are recorded in the tables, to which reference is made hereinafter, covering the collection and clearing operations of the bank. MISCELLANEOUS. There have been few changes in the official list or in the main outlines of the organization of this bank, which had been quite distinctly departmentalized before the beginning of the year. In January, Mr. J. C. Nevin of Avalon, Pa., was made assistant Federal Reserve agent. In April, Mr. H. F. Strater, of Cleveland, was made an assistant cashier, and some rearrangement of the super vision of departments under the several officers was effected. In Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 4 CLEVELAND. 461 other respects, the development of the organization has been merely an expansion, with minor adjustments, of the departments already in existence. At the end of the year, there were 153 employees in banking departments as against 64 last year; 116 in the check col lection and bookkeeping departments as against 75 a year ago, and 108 in the fiscal agency departments as against 58 in December, 1917—a total of 377 employees in the bank of Cleveland; there were 68 employees in the Cincinnati branch and 64 in the Pittsburgh branch. Expansion in physical quarters has been of course neces sary, and through the cooperation of the owners of the building occupied at Cleveland, the necessary space has been obtained with a surprisingly satisfactory location of departments for efficiency. The tabular statements under the caption of Schedule 21, appended hereto, show the growth in the volume of check collection and clear ing, both in the bank at Cleveland and the branches at Cincinnati and Pittsburgh, both of which have greatly facilitated and increased the service rendered in their vicinity. During the year there has been a net increase of 163 in the number of nonmember banks on the par list in this district, which now includes 79 per cent of the total number of banks in the district which handle any commercial business. While this progress is gratifying, it is not yet entirely satisfactory, and efforts are in progress constantly to increase the number, and thus increase the value of the service to member banks. Monthly totals of debits and credits to this bank in the gold settle ment fund are shown in Schedule 22. The daily settlement in this fund has vastly increased the usefulness of that most efficient instru ment, and the fund, with its tremendous volume of transactions without dislocation of funds, has been no small factor in preventing the serious disturbances that such a year of vast transactions would otherwise have inevitably produced. While the Federal Reserve Bank of Cleveland has been able to carry on its greatly expanded operations with far less inconvenience than some Federal Reserve Banks in cities where the requisite space could not be obtained in one building, yet our banking rooms are far from being ideally arranged, and it is obvious that in the near future provision will have to be made for more convenient working space in an environment more conducive to efficiency and more worthy of the institution. Accordingly, at the December meeting of our board of directors, a committee of the board was authorized to conduct negotiations for a suitable site upon which an adequate structure may be erected when conditions permit. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

462 AISTISTUAL REPORT OF THE FEDERAL RESERVE BOARD. EXHIBIT A.—Movement of principal earning assets of the Federal Reserve Bank of Cleve land during the calendar year 1918. [In thousands of dollars: i.e., 000 omitted.] Dis- j counted Se U S c p t u n a a r i p t e t e e d e r s d , b y O c t p o h a u e p n r e t d e r. d i s (1+2) m i b n o B a u o r il k g p ls e e h n t t . b c b i o T o l a u l u o s n n g t d d a t h e l i t d s . Pe ( r 1 - c 5 e ) n t. e a a T s r o s n e t i a t n s l . g war obli gations. 1 2 3 4 5 6 7 Jan. 4 16,516 24,496 41,012 18,968 59,980 27.5 103,519 Jan. 11 15,335 18.337 33,672 17,300 50,972 30.1 103,011 Jan. 18 14,770 22, 803 37,573 13,397 50,970 29.0 99,007 Jan. 25 26,707 22,653 49,360 12,978 62,338 42.8 96,874 Feb.1. 25,632 21,566 47,198 10,689 57,887 44.3 99,611 Feb.8 23,656 17,538 41,194 9,418 50,612 46.7 90,781 Feb. 15 18,838 19,763 38,601 8,905 47,506 39.7 84,490 Fob. 21 14,977 20,415 35,392 8,938 44,330 33 8 78,853 Mar.l 14,403 19,110 33,513 14,175 47,688 30.2 73,205 Mar. 8 15,414 17,308 32,722 22,735 55,457 27 8 80,406 Mar. 15 10,297 20,372 30,669 22,644 53,313 19.3 76,206 Mar.22 8,613 23,069 31,682 22,351 54,033 15.9 79,788 Mar.29 10,668 28,557 39,225 26,914 66,139 16.1 92,220 Apr. 5 '. 11,526 27,540 39,066 27,202 66,268 17.4 90,713 Apr. 12 23,242 28,229 51,471 26,692 78,163 29.7 101,145 Apr. 19 24,154 26,631 50,785 24,527 75,312 32.1 94,350 Apr. 26 28,529 29,683 58,212 20,628 78,840 36.2 97,632 May 3 27,037 27,851 54,888 18,022 72,910 37.1 91,909 MaylO 23,824 31,325 55,149 14,417 69,566 34.2 86,703 Mayl7 28,598 35,506 64,104 13,480 77,584 36.9 94,771 May24 23,833 30,185 54,018 10,827 64,845 36.8 82,467 May31 18,980 28,278 47,258 10,492 57,7f0 32.9 75,007 June 7 19,058 26,738 45,796 10,053 55.8^9 34.1 73,341 June 14 19,729 30,233 49,962 11,935 61,897 31.9 79,473 June 21 21,938 32,482 54,420 12,384 66,804 32. 8 84,285 June 28 19,641 36,537 56,178 13,980 70,158 28.0 80,491 July 5 29,181 43,379 72,560 12,806 85,366 34.1 94,699 July 12 35,951 52,703 88,654 12,931 101,585 35.4 110,639 July 19 38,176 52.338 90,514 15,556 106,070 36.0 114,633 July26 45,904 53,121 99,025 15,776 114,801 40 0 123,195 Aug. 2 41,844 53,094 94,938 17,112 112,050 37.3 119,779 Aug. 9 47,488 51,230 98,718 19,112 117, 830 40.3 125,309 Aug. 16 43,600 48,728 92,328 21,960 114,288 38.1 119,123 Aug. 23 36,701 45,811 82,512 26,111 108,623 33.8 112,878 43,835 46,127 89,992 26,077 116,069 37.8 120,056 Sept. 6 52,554 44,993 97,547 27,653 125,200 42.0 129,217 Sept. 13 54,259 40,680 94,939 29,476 124,415 43.6 128,432 Sept. 20 54,158 36,775 90,933 30,100 121, 033 44.7 125,584 Sept. 27 50,597 34,382 84,979 32,016 116,995 43.2 122,046 Oct. 4... 54,396 30,136 84,532 52,602 137,134 39.7 146,607 Oct. 10 55,686 28,807 84,493 53,598 138,091 40.3 150,403 Oct. 18 59,054 24,755 83,809 56,229 140,038 42.2 152,769 Oct. 25 61,128 19,075 80,203 57,458 137,661 44.4 149,631 Nov. 1 69,571 20,737 90,308 60,571 150,879 46.1 162,849 Nov. 8 73,214 19,374 92,588 60,597 153,185 47.8 165,098 Nov. 15 77,002 17,903 94,905 57,934 152/839 50.4 166,352 Nov. 22 95,473 16,380 111, 853 52,754 164,607 58.0 173,401 Nov. 29 107,287 17,313 124,600 50,673 175, 273 61.2 185,092 Dec. 6 113,831 16,031 129,862 51,501 181,363 62.8 195,500 Dec. 13 145, 823 15,863 161,686 i 49,466 i 211,152 69.1 j 225,289 Dec. 20 124,246 9,349 133,595 46,882 1 180,477 68.8 205,260 De3. 27 118,006 10,139 128,145 j 39,276 167,421 70.5 180,187 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 4 CLEVELAND. 463 FEDERAL RESERVEBANK OF CLEVELAND MOVEMENTOFEARNING ASSETS DURING THE CALENDARYEARI9I8. CUrre/. jVarJbcutv^nter. GxryeZ:J^tal3Ub discounted. GzrvcS:Silts ^Discounted and Jffought. Ch,rve^:9otaL£arrujt^J!ssc(s, incl. U.S. Government Securities, CarreS.-Jfcatio offifa/ZanShner &)Jbt€iLJ8iUs Discounted andJoought. \\60 m? \m\ €0\ \\SS vzo \2eo\S S\ \\so av }\SO\ \4S \ao W \40 \160 \40\ \\3S V40 \3S\ \\30 \IZ0 \30\ \\2S \IOO t2f \\20 eo \20\ \Us\ 60 \/S\ \40 \20 o fr // B2SI8i5ZUStSZ29Sei9X3H3IP»3f7M-Zl2SSZB2BZ9l623306820i74im2SieiSS296l5S02A JAN. \r£B.\MCH\APR\ MAr\JUN£\JULY\AU6.\ttPT.\ OCT. \NOV.\PE(P Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

464 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. EXHIBIT B.—Movement of cash reserves, net deposits, Federal Reserve note liabilities, and the reserve percentage of the Federal Reserve Bank of Cleveland during the calendar year 1918. [In thousands of dollars; i. e., 000 omitted.] Federal Total cash Net Reserve reserves. deposits. n a o c t t e u s a i l n (2+3) circulation. Jan. 4... 139,509 133,727 101,225 234,952 Jan. 11.. 118,903 107,621 106,115 213, 736 Jan. 18.. 136,443 121,997 105,282 227,279 Jan. 25.. 131,269 114,874 104,756 219,630 Feb. 1.. 133,585 121,037 103, 714 224, 751 Feb. 8.. 143,024 115,248 109,979 225,227 Feb. 15. 155,828 119,839 111, 960 231,790 Feb. 21. 161,382 114,085 117,434 231,519 Mar. 1.. 168,642 113,366 119,920 233,286 Mar. 8.. 168,399 116,485 123,410 239,895 MOT. 15. 175,682 118,623 124,392 243,015 Mar. 22. 172,471 114,756 128,566 243,322 Mar. 23. 164,813 116,594 131,479 248,073 Apr. 5.. 172, 790 122,229 132,257 254,486 Apr. 12. 162,930 118,149 136, 762 254,911 Apr. 19. 165,567 114,515 136,147 250,662 Apr. 26. 178,449 126,580 140,236 266,816 Mav 3.. 180,070 121,466 141,306 262,772 May 10. 178,366 110,834 145,092 255,926 May 17. 189,883 132,498 142,917 275,415 May 24. 194,191 116,291 150,987 267,278 May 31. 196,650 111,899 150,428 262,327 June 7.. 207,377 116,988 154,347 271,335 June 14. 202,662 117,656 155,032 272, 688 June 21. 168,788 85,765 157,884 243,649 June 28. 189,145 97,084 162,918 260,002 July 5.. 198,894 117,503 166,778 284,281 July 12. 217,428 148,089 170,477 318,566 July 19. 184,566 120,857 168,717 289,574 July 26. 195,018 130,856 177,616 308,472 Aug. 2.. 191,532 124,144 177,291 301,435 Aug. 9.. 202,059 130,257 187,075 317,332 Aug. 16. 201,927 122,449 188,467 310,916 Aug. 23. 218,153 120,713 200,159 320,872 Aug. 30. 228,560 132,639 205,591 338,230 Sept. 6.. 213,635 119,783 212,398 332,181 Sept. 13. 230,032 128,393 219,108 347.501 Sept. 20 234,983 128,226 221,084 349,310 Sept. 27. 254,284 136,491 228,082 364,573 Oct. 4.. 218,445 123,693 228,809 352.502 Oct. 10. 217,487 116,733 237,403 354,136 Oct. 18. 219,198 121,726 235,596 357,322 Oct. 25. 231,274 121,209 244,571 365,780 Nov. 1.. 211,983 117,082 242,113 359,195 Nov. 8.. 213,342 112,479 249,764 362,243 Nov. 15. 227,221 128,783 248,204 376,987 Nov. 22. 198,637 105,982 248,597 354,579 Nov. 29. 197,038 116,432 247,535 363,967 Dec. 6.. 193,547 123,869 246,044 369,913 Dec. 13. 177,443 134,034 248,583 382,617 Dec. 20. 168,365 99,531 253,275 352,806 Dec. 27. 198,579 102,029 255,486 357,515 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT KO. 4 CLEVELAND. 465 FEDERALRESERVEBAmOFCLEVELAND. DEPOSIT AND NOTE LIABILI TIES, ALSO CASH RESERVES, PUR!NO THE CALENDAR YEAR 19/8\ I Curve IJYek&efwsits. Curve Z.- JotalCasfaJteserves. { (Qirve3: Jiggregate JYctZtejiosit and.£Jt. ^fafeJlaJbiltties^ &zrve4.3uz£6o of Qtsh,Reserves do Jfggregate JYet ZteftosiG astcC SZ%. Mde j£a&zu£6e&. 4 // !8Xl4tSZIi8 ISZZ95IZB2S3 tO 17&-3!7142 2SS!2t3aS23 #233061320274 il I8&14 KZ2£9602QZ?\ JAN.\ fsE&.\ MCH.\ APR. 1 MAr\JUNE\JULY \ AU<3.\SEPT\ OCT. \ NOV. \ DEC. 100823°—19 30 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

466 AKISTUAL REPORT OF THE FEDERAL RESERVE BOARD. SCHEDULE 1.—Statement of condition of the Federal Reserve Bank of Cleveland, Dec. SI, 1918, compared with Dec. 31, 1917. 1918 1917 RESOURCES. Bills discounted $28,412,284.55 $37,163,027.27 Member banks collateral notes 77,339,400.00 33,733,150.00 Rediscounts for other Federal Reserve Banks 21,583,497.09 Acceptances bought 37,445,215.53 21,111,990.95 Investments—short-time municipal obligations . 7,233.38 United States bonds and securities: 2 per cent Treasury certificates of indebtedness to secure circula tion 9,458,000.00 3 per cent one-year Treasury notes 1,202,000.00 3.221,000.00 3 per cent conversion bonds ,. 414,800. 00 414,800.00 3£ per cent Liberty loan bonds 266,200.00 2,027,000.00 4| per cent Liberty loan bonds 427,850.00 4| per cent Treasury certificates of indebtedness 1,065,500.00 2*per cent bonds (consols and Panamas) 473,600.00 3 per cent bonds 1918 2,653,660. 00 4 per cent second Liberty loan bonds '320,750.00 4 per cent Treasury certificates of indebtedness 50,000.00 4 per cent bonds 1925 2,378,200.00 Total earning assets. 177,614,747.17 103,554,411.60 Gold coin and certificates on hand 12,865,862. 50 29,153,275.00 Gold settlement fund 52,125,485.35 37,664,000.00 Gold redemption fund—Federal Reserve notes, 1,368,280.00 98,800.00 Gold with Federal Reserve agent 138,277,370.00 55,369,700.00 Gold with foreign agencies 524,598.71 4,725,000.00 Gold in transit for redemption 391,322.50 737,165. 00 Total gold reserve 205,552,919.06 127,747,940.00 Legal-tender notes and silver certificates 846,650.00 238,369.00 Legals and silver in transit for redemption 865,724.00 129,100.00 Total reserves 207,265,293.06 128,115,409.00 Accrued interest on United States securities 58,514.53 62,878.48 War loan expenses advanced 784,431. 49 139,247.83 Due from banks and bankers 1,725.73 11,792.01 Uncollected transit items 58,554,835.47 68,339,457.12 National-bank notes and notes of other Federal Reserve banks 4,275,119.00 1,080,260.00 Federal Reserve notes on hand 14,147,660. 00 3,666,525.00 Federal Reserve bank notes on hand 869,385.00 Due from Treasurer United States 5 per cent fund (Federal Reserve bank notes) 531; 800. 00 Other cash and coin 5,004.93 1,042.20 Due from banks—war loan accounts 38,413,558.56 68,051,154.98 Total resources.. 502,522,074.94 373,022,178. 22 LIABILITIES. Capital paid in • 9,072,700.00 8,026,100.00 Surplus fund 1,776,000.00 Reserve for depreciation 84,406.79 Reserve for franchise tax 1,776,000.00 Profit and loss 132,311.58 Unearned discount and interest 314,121.08 190,643. 23 United States Government deposits " 749,987.69 30,578,247.23 Due to member banks (reserve accounts) 123,423,976.31 109,724,561.05 Due to nonmember banks (clearing accounts) 94,160.59 Deferred credits 49,581,406.40 50,523,993.99 Official checks outstanding 192,616. 86 30,574.69 Federal Reserve notes outstanding 266,519,915.00 105,669,700.00 Federal Reserve bank notes outstanding 10,600,000.00 Treasurer of the United States (special deposit account) 26,468,812.78 34,242,100.00 Treasurer of the United States (Liberty loan deposit account). 11,946,745.78 33,809,054.98 Other liabilities 17,386.25 730. 88 Total. 502,522,074.94 373,022,178.22 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 4 CLEVELAND. 467 SCHEDULE 2.—Comparative statement, profit and loss account, 1918-1917. 1917 Profit and loss $132,311.58 $94,797.44 Earnings from: Bills discounted members 3,124,696. 41 375,169. 00 Bills bought in open market 1,141,584.25 496,711. 58 "United States securities 783,021.85 342,185.11 Municipal warrants 48,131. 73 Sundry earnings, penalties, and transfers bought and sold. 177,560.68 63,145.30 Total.. 5,359,174. 77 1,420,140.16 Expenses: Assessment for expenses Federal Reserve Board 43,073. 46 25,783.40 Cost of Federal Reserve notes.., 182,092. 48 91,256.39 Premium on United States bonds and securities charged off. 98,882. 79 209,469. 52 Operating expenses 767,018.82 245,150. 97 Dividends paid 716,107.22 716,168.30 Balance profit and loss Dec. 30, 1917 132,311.58 Transferred to surplus account 776,000. 00 Transferred to reserve for franchise tax 776,000. 00 Total. 5,359,174.77 1,420,140.10 SCHEDULE 3.—Gross earnings, classified, expenses and net earnings, 1918. m B co e il u m ls n b t d e e i r d s s , . op b e o n u B m g il h a l t s r i k n e t. se U c S u n ta r i i t t t e e i s d e s. A ea l r l n o in th g e s r . ea T rn o i t n a g l s. ex T pe o n ta s l e s. ear N ni e n t gs. January $136,930.23 $48,096.00 $122,987.25 $15,977.10 $323,990.58 $63,628.39 $260,362.19 122,986.04 32,591.26 101,394.20 11,999.15 268,970.65 59,966.25 209,004.40 March 116,791. 26 79, J.19.38 70,434.84 14, 776. 00 281,121.48 66,182.94 214,938. 54 April 175, 702. 02 83,523.01 67,039.38 13,632.52 339,896.93 77,964.65 261,932.28 May 210,955.48 48,827.14 54,439.31 15,984.27 330,206.20 72,779.53 257,426.67 June 186,184. 48 42,620.29 78,036.18 21,420.11 328,261.06 76,958.40 251,302.66 July 324,636.96 52,300.84 113,951.20 19,526.03 510,415.03 69,644.72 440,770.31 August 352, 422.37 80,130.09 63,487.55 12,970.19 509,010.20 72,048. 64 436,961.56 September... ... 331,657.98 102,874.72 12,592.94 11,201.52 458.327.16 63,421.17 394,905.99 October 306,691.94 198,476.00 35,377.59 13,289.95 553,835. 48 71,439.90 482,395. 58 November 367,143.13 199,416.62 30,974.10 11,401.53 608,935.38 91,880.33 517,055.05 492,594.52 173,608.90 32,307.31 15,382.73 713,893.46 206,270. 26 507,623. 20 Total 3,124,696.41 1,141,584.25 783,021.85 177,561.10 5,226,863.61 992,185.18 4,234,678.43 SCHEDULE 4.—Daily average earning assets, earnings thereon, and average rate per annum, year 1918 compared with year 1917; also other earnings. Earning assets. Earnings. Average rate. 1918 1917 1918 1917 1918 1917 Bills discounted, members and Federal Reserve banks. $73,080,025.35 $9,531,458.45 $3,124,696.41 $375,168.90 4.2S 3.94 Acceptances bought 27,175,072.99 15,348,152.44 1,141,584.25 496,711.58 4.20 3.23 Municipal warrants 1,457,325.80 48,131.73 3.30 United States bonds, notes, and certificates 17,721,544.11 11,314,574.40 611,894.58 317,924.42 3.45 2.21 Total 117,976,642.45 37,651,511.09 4,878,175.24 1,237,936.63 4.13 3.29 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

468 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. SCHEDULE 4.—Daily average earning assets, earnings thereon, and average rate per annum, year 1918 compared with year 1917; also other earnings—Continued. OTHER EARNINGS. 1918 1917 Profits realized on earning assets S4,8 78,175.24 $1,237,936.63 Profits realized on United States securities.. 167,238.95 24,260.69 Service charges—net 41,029.48 Sundry profits 22,744.38 2,995.98 Penalties on deficient reserves 66, 462. 03 17,843.62 Transfers 60,213. 53 14,022.22 Total earnings.. 5,226,863.61 1,297,059.14 Total expenses.. 992,185.18 319,304.31 Net earnings 4,234,678. 43 977,754.83 Capital, daily average 8,585,995.89 6,433,207.00 Rate per annum—gross earnings to capital (per cent). 68.76 20 Rate per annum—net earnings to capital (per cent)... 48.16 15.91 SCHEDULE 5.— Volume of loans, discounts and investments handled during year 1918 compared with year 1917. 1918 1917 DISCOUNTED AND PURCHASED. Bills discounted—members $392,524,428. 41 $92,642,455.36 Member bank collateral notes 993,593,567.01 118,533,650.00 Acceptances bought i 175, 717,826. 21 91,109,193.06 Rediscounts—Federal Reserve banks 82,915,964.44 Municipal warrants 2,949,074.30 United States securities 2 259,123,450.00 69, 707,100.00 Total 1,903,875,236.07 374,941,471.72 Increase over 1917 1,528,933,764.35 PAID AND SOLD. Bills discounted—members ' 401,275,171.13 56,486,201.59 Member bank collateral notes 921,987,317.01 112,800,500. 00 Acceptances bought from members and Federal Reserve banks... 159,384,601.63 80,150,896.86 Rediscounts—Federal Reserve banks 61,352, 467. 35 Municipal warrants 7, 233.38 5,626, 430. 56 United States securities 285,852,410.00 38,147,550.00 Total 1,829,859,200.50 293,211,579.01 Increase over 1917 1,536,647,621.49 i Excludes $1,280,852 of acceptances purchased by the New York Federal Reserve Bank for OUT account on Dec. 31, 1918. 2 Includes $1,202,000 of 1-year Treasury notes renewed by United States Treasurer on Jan. 1, 1918, and $374,550 of 4J per cent bonds converted from 4 per cent bonds. SCHEDULE 6.—Rediscounts—Members and member bant collateral notes, 1918. Kentucky. Pennsylvania. Ohio. Vi W rg e i s n t i a. Total. Applications 669 1,210 3,746 59 5,714 Banks accommodated 32 100 184 4 320 Commercial and indus $5,294,194.63 $29,680,032.10 $259,512,546.37 $90,996.40 $294,577,769.50 trial paper Trade acceptances 709,635.22 4,979,358.30 19,154,626. 59 50,670. 73 24,894,290.84 Agricultural and live stock. 139,779. 53 27,662.34 654,006.19 808.00 822,256.06 196,530.22 196,530.22 Liberty loan secured re discounts 2,125,912, 81 7,881,196.20 61,340,472.78 686,000.00 72,033,581.79 Member collateral notes: Secured by commer- 100,000.00 3,010,000.00 1,830,000.00 4,940,000.00 Secured by United States securities 27,117,365.00 509,896,465.00 447,920,737.01 3,719,000. 00 988,653,567.01 Total rediscounts and loans 35,486,887.19 555,474,713.94 790,608,919.16 4,547,475.13 1,386,117,995.42 NOTE.—Included in above were rediscounts and loans to state bank members as follows: Commercial and industrial paper rediscounted $24,914,733.98 Customers notes secured by Liberty loan bonds * 14,760,903.61 Direct loans secured by United States government bonds 230,694,650.00 Total 270,370,287.59 The total of rediscounts made for other Federal Reserve Banks (not included in above Digitized for FRtaAblSesE) Rw as 82,915, 964.44 http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 4 CLEVELAND. 469 SCHEDULE 7.—Acceptances purchased in open market and acquired from other Federal Reserve Banks. Bankers', foreign $79,253,973.24 Bankers', domestic 88,425,763.62 Dollar exchange... 2,725,000.00 Trade acceptances, foreign 1,272,431. 64 Trade acceptances, domestic 4,040,657.71 Total 1175,717,826.21 Acceptances purchased— From or through other Federal Reserve Banks 123,526,132. 27 From Kentucky banks 1,318,900.5c From Ohio banks 44,231,853.17 From Pennsylvania banks 6,640,940. 22 Total 1175,717,828.21 SCHEDULE 8.— United States securities purchased. Special 2 per cent certificates of indebtedness $65,458,000 United States 3 per cent notes and bonds 21,207,000 United States 4 per cent bonds 61,250 United States 4 per cent certificates of indebtedness 171,256,000 United States 4* per cent certificates of indebtedness 20,729,000 United States 4} per cent Liberty loan bonds 3 412,200 Total 259,123,450 SCHEDULE 9.—Member banks liquidated during 1918. Shares Name of bank. Location. Disposition. sub scribed. First National Bank Bentleyville, Pa Absorbed by Farmers & Miners National 15 Bank, Bentleyville, Pa. Bank of Commerce, and the... Cleveland, Ohio Formed the Union Commerce 1,800 do National Bank, Cleveland, Ohio 1,800 Deny, Pa Succeeded by First Savings & Trust Co., 60 Deny, Pa. Fourth National Bank Dayton, Ohio Absorbed by Dayton Savings & Trust Co. 510 Dayton, Ohio. St. Clair National Bank Freedom, Pa Absorbed by Freedom National Bank, 60 Freedom, Pa. First National Bank Loudonville, Ohio .. Succeeded by First & Savings Bank, Lou 19 donville, Ohio. Norwalk National Bank Norwalk, Ohio Succeeded by Citizens National Bank, 90 Norwalk, Ohio. 4,354 Member banks in District No. 4. Number of member banks Dec. 31,1917 764 New national banks organized & State banks and trust companies admitted. 53 Total 822 Liquidated during 1918.. Number of member banks Dec. 31,1918. 814 Capital stock paid in, Dec. 31,1917 $8,026,100 Capital stock paid in, Dec. 31,1918 9,072,700 Increase for the year 1,046,600 i Exclusive of $1,280,852 of acceptances purchased by the New York Federal Reserve Bank for our account on Dec. 31, 1918. 2 Includes $1,202,000 of 1-year Treasury notes renewed by U. S. Treasurer on Jan. 1, 1918. 3 Includes conversion of $374,550 4 per cent Liberty loan to 4| per cent. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

470 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. SCHEDULE 10.—New National and State bank members during 1918. NATIONAL BANKS. Date of Shares admis Name of bank. Location. sub sion. scribed. Mar. 8 The Union Commerce National Bank Cleveland, Ohio 3,600 Sept 5 Prairie Depot National Bank of Freeport Prairie Depot, Ohio 10 Oct. 25 First National Bank Timhlin, Pa 13 Nov. 23 First National Bank Chagrin Falls, Ohio 12 Dec. 30 Citizens National Bank Norwalk, Ohio 120 STATE BANKS ADMITTED TO SYSTEM:. Date of Capital Deposits admis Name of bank. Location. and when sion. surplus. admitted. Jan. Oakland Savings & Trust Co Pittsburgh, Pa $400,000 13,684,000 Jan. The Steubenville Bank & Trust Co Steuben ville, Ohio 175,000 1,367,000 Jan. The Newark Trust Co Newark, Ohio 325,000 2,128,000 Jan. Security Savings & Trust Co Erie, Pa 500,000 3,291,000 Jan. Colonial Trust Co Pittsburgh, Pa 5,200,000 13,511,000 Feb. The Superior Savings & Trust Co Cleveland, Ohio 1,500,000 14,781,000 Feb. The Central Savings & Trust Co Akron, Ohio 1,000,000 9", 259,000 Feb. 12 The Western Bank & Trust Co Cincinnati, Ohio 875,000 9; 660,000 Mar. 21 The First Wellington Bank Wellington, Ohio 155,000 1,074,000 Apr. 2 The Depositors Savings & Trust Co Akron, Ohio 550,000 3,386,000 Apr. 12 The Union Savings Bank & Trust Co Cincinnati, Ohio 3,000,000 17,779,000 Apr. 13 Allegheny Trust Co Pittsburgh, Pa 1,200,000 3,606,000 May 7 Crawford County Trust Co Mead ville, Pa 135,000 1,403,000 May 14 Commercial Savings Bank & Trust Co... Toledo, Ohio 250,000 4,377,000 May 17 The Minster State Bank Minster, Ohio 40,000 308,000 June 3 Security Trust Co Lexington, Ky 650,000 1,120,000 June 28 Bellevue Realty Savings & Trust Co Bellevue, Pa 175,000 739,000 July 1 The City Savings Bank & Trust Co .A lliance, Ohio 200,000 2,189,000 July 2 The Struthers Savings & Banking Co Struthers, Ohio 100,000 1,616,000 July 3 The Dayton Savings & Trust Co Dayton, Ohio 500,000 7,511,000 July 9 The Dime Savings Bank Co Canton, Ohio 320,000 3,197,000 July 18 The Peoples Savings & Trust Co Akron, Ohio 300,000 3,938,000 Julv 20 The Geneva Savings Bank Co Geneva, Ohio 165,000 781,000 July 23 The Citizens State Bank West Milton, Ohio 35,000 256,000 July 31 The West Lafayette Bank Co West Lafayette, Ohio. 150,000 865,000 July 31 The Cuyahoga Falls Savings Bank Co Cuyahoga Falls, Ohio. 130,150 996,000 Aug. 8 The Gibsonburg Banking Co G ibsonburg, Ohio 67,500 617,000 Aug. 8 The Provident Savings Bank & Trust Co.. Cincinnati, Ohio 2,400,000 10,034,000 Aug. 13 The Chagrin Falls Banking Co Chagrm Falls, Ohio... 95,000 037,000 Aug. 15 The Home Banking Co Gibsonburg, Ohio 34,000 511,000 Aug. 17 The Rossford Savings Bank Rossford, Ohio 50,000 Aug. 22 The Peoples Savings & Banking Co Barberton, Ohio 120,000 1,048,000 Aug. 24 The Citizens Bank Cuayhoga Falls, Ohio. 52,000 294,000 Aug. 26 The Commercial & Savings Bank Co Buckeye City, Ohio... 27,750 158,000 Aug. 26 The Farmers & Citizens Banking Co Milan, Ohio 33,000 315,000 Sept. 10 The Home Banking Co St. Marys, Ohio 120,000 764,000 Sept. 17 Woodlawn Trust Co Woodlawn, Pa 187,500 1,446,000 Sept. 17 Ambridge Savings & Trust Co Ambridge, Pa 175,000 1,345,000 Sept. 20 The Peninsula Banking Co Peninsula, Ohio 29,000 165,000 Sept. 23 Beaver Trust Co Beaver, Pa 400,000 1,087,000 Sept. 26 Federal Title & Trust Co Beaver Falls, Pa 225,000 890,000 Sept. 30 State Bank & Trust Co Richmond, Ky. 200,000 738,000 Oct. 1 The Brighton Bank & Trust Co Cincinnati, Ohio 400,000 4,994,000 Oct. 8 The Lodi State Bank Lodi, Ohio 100,000 490,000 Oct. 22 The Dollar Savings & Trust Co Youngstown, Ohio 2,000,000 16,805-, 000 Nov. 19 The Minerva Savings & Trust Co Minerva, Ohio 90,000 1,258,000 Nov. 23 Bank of Independence Independence, Ky 48,000 226,000 Dec. 5 The Erie County Banking Co Vermilion, Ohio 150,000 414,000 Dec. 9 The Spencer State Bank Spencer, Ohio 25,000 115,000 Dec. 9 Title Guarantee & Trust Co Lexington, Ky 165,000 678,000 Dec. 16 The Alliance Bank Co .A lliance, Ohio 270,000 2,905,000 Dec. 21 Commonwealth Trust Co Pittsburgh, Pa 2,500,000 8,424,000 Dec. 30 The United Banking & Savings Co Cleveland, Ohio 1,400,000 12,044,000 Total.. 29,393,900 181,224,000 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 4 CLEVELAND. 471 SCHEDULE 11.—Banks granted fiduciary powers under Section 11 of Federal Reserve Act, Date. Name. Location. Powers granted. Apr. 5 Union Commerce National Bank Cleveland, Ohio Registrar of stocks and bonds. May 31 Northern National Bank Toledo, Ohio Do. Feb. 16 Second National Bank Trustee. Mar. 13 Peoples National Bank Pittsburgh, Pa Registrar and transfer agent of stocks and bonds in so far as relate to registering. Sept. 10 First National Bank Grove City, Pa Trustee. Dec. 30 Western National Bank Pittsburgh, Pa Trustee, executor, administrator, regis trar of stocks and bonds, guardian of estates, assignee, receiver, committee of estates of lunatics. Dec. 30 Citizens National Bank Washington, Pa Trustee, executor, administrator, guar dian of estates, assignee, and receiver. Feb. 20 First National Bank Paris, Ky Trustee, executor, administrator, and registrar of stocks and bonds. SCHEDULE 12.—Certificates of indebtedness. ISSUED IN ANTICIPATION OF THIRD LIBERTY LOAN, 1918. National banks. State banks. Date. Num P o e f r t c o e t n al t P o e f r t c o e t n al t Num P o e f r t c o e t n al t P o e f r t c o e t n al t ber of banks bank Amount. ber of banks bank Amount. banks. in dis subscrip banks. in dis subscrip trict. tions. trict. tions. Jan. 22 358 47.86 65.29 $16,974,000 188 22.54 16.70 $4,342,000 Feb. 8 532 71.12 §0.56 20,592,000 415 49.76 13.27 4,512,000 Feb. 27 728 97.32 58.44 26,006,500 467 55.99 19.79 8,808,500 Mar. 20 554 74.06 57.85 27,999,000 - 492 58.75 16.51 7,990,500 Apr. 10 373 49.86 57.97 26,668,500 300 35.84 9.66 4,443,000 Apr. 22 313 38.70 55.12 21,570,500 231 26.83 15.61 6,108,000 Trust companies. Miscellaneous and private banks. Per cent Per cent Per cent Per cent Date. Num of total of total Num of total of total ber of banks bank ber of banks bank Amount. banks. in dis subscrip banks. in dis [subscrip trict. tions. trict. tions. Jan. 22. 86 37.23 16.78 $4,363,000 1.89 1.23 $321,000 Feb. 8.. 120 51.52 24.91 8,468,000 3.77 1.26 428,000 Feb. 27. 130 56.28 21.65 9,633,000 11.32 .12 52,000 Mar. 20. 133 57.57 25.08 12,139,000 77.36 .56 271,500 Apr. 10. 115 49.78 32.01 14,724,500 52.83 .36 164,000 Apr. 22. 86 37.23 28.89 11,309,000 18.86 .38 146,000 RECAPITULATION. Per cent Per cent Number of total of total District banks. of banks Banks banks of banks Total in dis sub subscrib subscrip subscriptions. trict. scribing. ing in tions. district. National 748 737 98.53 58.74 $139,810,500 State 834 787 94.36 15. 20 36,204,000 Trust companies 231 219 94.80 25.48 60,636,500 Private and miscellaneous banks 49 .58 1,382,500 Total banks 1,813 1,743 96.14 100.00 238,033,500 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

472 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. SCHEDULE 12.—Certificates of indebtedness—Continued. ISSUED IN ANTICIPATION OF FOURTH LIBERTY LOAN. National banks. State banks. Per cent] Per cent) Date. b N b a e u n r m k o s f . b d P o a i e f s n r t t k r o c i s e t c a n i t l n . t ] | [ s o u t b f i b o a s t n o n cr k s t i a . p l Amount. b N b a e u n r m k o s f . b d P o a i e f s n r t t k r o c i s e t c a n i t l n t ) | |s o u t b f b i a s o to n c n r k s t i a . p l -| Amount. June 25. 533 71.45 63.32 $50,653,500 340 40.65 8.98 $7,185,000 July 9.. 540 72.38 58. 92 59,212,500 345 41.36 9.23 6,141,000 July 23. 547 73.32 61.17 34,209,000 407 48.80 10.92 6,110,500 Aug. 6.. 533 71.45 57.90 30,397,500 399 47.84 13.51 7,093.500 Sept. 3. 599 74.93 45.78 33,921,000 465 55.75 10.36 7,670,500 Sept. 17 5*3 78.15 60.04 35,615,500 492 58.99 12.69 7,527,000 Oct. 1.. 498 66.75 57.26 29,876,000 336 40.29 14.40 7,515,500 Trust companies. Miscellaneous and private banks. Individuals. Per Date. b N b r e u i r n m k o f s . c b i t n t e r a P o i n d n t e c t a i r k t s l o . s f c t s b t s i e c P o o a u n r t e n n i b t a r p k s l o . f Amount. b N b a e u n r k m o s f . i c b t n t e r a P o i n d n t e c t a i r k t s l o . s f c s t b t s i e c P o o a u r n t e n n i b t a r p k s l o . f Amount. N b u i v n e a u i r d l d m s i o . f c s i t s v e c n u o u n r i d a t d b i t a l p i l o f Amount. tions. June 25 134 58.01 26.74 $21,395,000 85 41.66 0.83 $668,000 5 0.13 $98,500 July9 142 61.47 30.48 20,285,500 97 47.55 1.32 879,500 9 .05 31,500 July 23 149 64.50 26.13 14,613,500 94 46.08 1.68 938,500 4 .10 55,500 Aug. 6 145 62.77 26.32 13,819,500 110 53.92 1.99 1,043,500 8 .28 ^ 146,000 Sept. 3 163 70.56 41.56 30,788,500 122 59.80 2.07 1,540,000 7 .23 168,000 Sept. 17 162 70.12 25.24 14,974,500 120 58.82 1.86 1,104,500 1 .07 100,000 Oct.l 131 56.71 26.70 13,929,500 70 34.31 1.45 758,000 3 .19 103,500 RECAPITULATION. Number Per cent Per cent District banks. of i n tr b i d a c i n t s . ks su B b i a s n n c g r k . i s b s o d u f i i b n s b g s tr c a i r i n c n i k b t. s s o u t f b b i o a s t c n o n r k s t i . a p l subsc T r o i t p a t l i ons. National 746 729 97.72 57.63 $253,885,000 State 834 671 80.44 11.18 49,243,000 231 199 86.14 29.46 129,806,000 Miscellaneous and private banks 204 176 86.27 1.57 6,932,000 Individuals 37 .16 703,000 Total 1 2,015 1,812 88.08 100.00 440,569,000 FIRST TAX SERIES, 1918. National banks. State banks. Date. b N b a e u n r m k o s f . b d P o a i f e s n r t t k r o c i s e t c a n t i l n t | s P u o t b f b e i r o a s t c o n n c r k e t s i a . n p l t ] Amount. b N b a e u n r m k o s f . b P d o a i e f s n r t t k r c o i s e t c a i n t n l . t ] I P s o u t e f i b r o t s c n o c e s t r n a . i l p t Amount. Jan. 2.. 147 19.71 67.87 $47,558,500 4.20 2.48 $1,736,000 Feb. 15. 123 16.49 68.19 W, 503,000 5.40 6.56 1,011,000 Mar. 15. 13.27 73.05 40,629,500 3.60 2.81 1,564,000 Apr. 15. 7.51 84.39 8,934,500 1.56 1.88 199,500 May 15. 8.18 79.25 14,698,000 2.64 2.25 418,000 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. i—CLEVELAND. 473 SCHEDULE 12.— Certificates of indebtedness—Continued. FIRST TAX SERIES, 1918—Continued. Trust companies. Miscellane b o a u n s k a s. n d private Individuals. Per Date. b N b a e u n r k m o s f . i c b n t t e r a P o i n d n e t c t a i r k t s l o . s f c t s t s i e c P o o u n r t e n b i t a r p s l o . f Amount. b N b a e u n r k m o s f . c b i t n t e r a P o i n n e t d c t a r k i t l o s . s f c s t b t s i c e P o o a u r n t e i n n b t a r p k s l o . f Amount. N b i u v n e u a i r d l d m s i o . f c s i e t s v c n u o n u i r d a t t d i b a l i p o l f Amount. tions. Jan. 2 44 19.05 23.89 $16,741,500 6 2.94 0.15 $100,500 23 5.61 $3,933,000 Feb. 25 37 16. 02 24.29 3,742,000 14 6.86 .72 110,000 3 .24 36,500 Mar. 15 44 19.05 22.90 12,734,500 8 3.92 .34 187,000 12 .90 500,500 Apr. 15 15 6.49 12.81 1,355,500 5 .92 97,500 May 15 23 9.96 18.45 3,421,500 1 .05 10,000 RECAPITULATION. Per cent Number of total Per cent District banks. o i f n t r b i d a c i n t s . ks su B b i a n s n c g r k . i s b s n u b a i b n t a g s i n o c k i r n n s i a b l s o u t f b b i o a s t c n o n r k s t i . a p l s T c o r t i a p l t i s o u n b s . district. National 746 147 19.71 71.86 $122,323,500 State 834 45 5.40 2.90 4,928,500 Trust companies. 231 44 19.05 22.32 37,995,000 Miscellaneous 204 14 6.86 .23 397,500 Individuals 44 2.69 4,577,500 Total 2,015 294 100 170,222,000 TAX ISSUE, DATED NOV. 7, 1918: 4* PER CENT; DUE MAR. 15, 1919. ANALYSIS OF SUBSCRIPTIONS. Number subscrib Per cent. Amount. ing. Total subscriptions for district $112,500,000 National banks , 215 46.68 52,515,500 State banks 80 6.79 7,639,500 Trust companies 76 45.89 51,628,000 Miscellaneous banks 22 .53 596,000 Individuals 14 .11 121,000 Total 407 100.00 112,500,000 PERCENTAGE OP BANKS SUBSCRIBING. Number Total in subscrib district. Per cent. ing. National banks 215 746 28.82 State banks 80 834 9.59 Trust companies 76 231 • 32.90 Miscellaneous banks 22 204 10.78 Total 393 2,015 19.50 Fourteen individuals subscribed. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

474 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. SCHEDULE 12.—Certificates of indebtedness—Continued. TAX ISSUE, DATED AUG. 20, 1918; 4 PER CENT; DUE JULY 15, 1919. ANALYSIS OF SUBSCRIPTIONS. Number subscrib Per cent. Amount. ing. Total subscriptions for district $29,968,500 National banks 157 69.28 20,761,000 State banks 44 3.34 1,001,000 Trust companies 64 26.27 7,872,500 Miscellaneous and private banks 10 .68 205,000 Individuals 9 .43 129,000 Total 284 100.00 29,968,500 PERCENTAGE OF BANKS SUBSCRIBING. Number Total in subscrib district. Per cent. ing. National banks. 157 746 $21.05 State banks 44 834 5.28 Trust companies 64 231 27.71 Miscellaneous and private banks 10 204 4.90 Total 2,015 13.65 Nine individuals subscribed. SCHEDULE 13.—Depositaries department. REPORT FOR YEAR ENDED DEC. 31, 1918. Depositary banks, Jan. 1,1918 293 New depositaries 360 653 Depositaries discontinued 41 Depositary banks, Dec. 31,1918 612 Total in depositary banks, Jan. 1,1918 $68,051,154.98 Payment by depositary banks by credit to war loan deposit account: For Treasury certificates of indebtedness $783,762,572.36 For Liberty loan bonds 465,373,409.53 $1,249,135,981.89 Redeposits with depositary banks: Treasury certificates of indebtedness funds 20,165,000.00 Liberty loan bonds funds 16,050,000.00 Income and excess profits tax funds 97,791,000.00 134,006,000.00 1} 383, HI, 981.89 1,451,193,136.87 Withdrawals 1,422,853,078.31 Total balances with depositary banks, Dec. 31,1918 28,340,058.56 Largest aggregate deposits, Oct. 28,1918, $189,757,237.23. Interest collected on daily balances, $1,748,457.25. SECURITIES PLEDGED BY DEPOSITARY BANKS AS COLLATERAL FOR WAR LOAN DEPOSITS. Valued as Par value. collateral. Total pledged Jan. 1,1918 $127,113,000 $106,431,000 Total pledged Dec 31,1918 151,729,000 124,300,000 Largest aggregate pledged Oct. 30,1918 245,642,000 203,350,000 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 4 CLEVELAND. 475 SCHEDULE 13.—Depositaries department—Continued. CHARACTER OF SECURITIES PLEDGED, DEC. 31, 1918. Par value. United States bonds and certificates of indebtedness $52,284,000 < Municipal bonds and warrants 8,294,000 Foreign Government and municipal bonds 24,323,000 Corporation bonds 45,952,000 Commercial paper 20,876,000 Total 151,729,000 SCHEDULE 14.—Third Liberty loan. [Dated May 9, 1918; 4i per cent; callable June 15,1925-1937.) ANALYSIS OF SUBSCRIPTIONS. Number sub Percent. Amount. scribing. Total subscriptions for district $405,051,150 National banks 744 56.71 229,691,000 State banks 711 15.31 61,998,650 222 25.39 102 860 500 218 2.52 10* 232' 900 Individuals 634 .07 '268' 100 Total 2,529 100.00 405,051,150 PERCENTAGE OF BANKS SUBSCRIBING. Number scr s i u b b i ng. T di o s t t a r l i c in t. Percent. National banks 744 746 99.73 State banks 711 834 85.25 Trust companies 222 231 96.10 Miscellaneous banks. 218 224 97.32 Total. 1, 2,035 93.12 Six hundred and thirty-four individuals subscribed. SCHEDULE 15.—Fourth Liberty loan. [Dated Oct. 24, 1918; collectible Oct. 15, 1933-1938.] ANALYSIS OF SUBSCRIPTIONS. Number sub Percent. Amount: scribing. Total subscriptions for district $701,909,800 National banks 746 55.63 390,457,200 State banks 711 15.05 105,661,650 Trust companies 223 26.97 189,274,800 Miscellaneous banks 224 2.34 16,448,050 Individuals 128 .01 68,100 Total 2,032 100. 00 701,909,800 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

476 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. SCHEDULE 15.—Fourth Liberty Loan—Continued. PERCENTAGE OF BANKS SUBSCRIBING. Number scr s i u b b in g. d T i o s t t a r l i c in t. Per cent. 746 746 101.00 State banks 717 834 85. 97 223 231 9-j. 54 224 224 101 00 Total 1,910 93.86 One hundred and twenty-eight individuals subscribed. SCHEDULE 16.— War-savings certificates and thrift stamp sales, 1918, W c s a e t r r a t - i s m f a ic v p a i s n t . e g s s T ta h m ri p ft s . W c s a e t r r a t - i s m f a ic v p a i s n t . e g s st T a h m ri p ft s . January., $1,322,099.76 $216,525.25 August '2,999,609.32 $257,389.50 February 1,066,314.37 134,313.00 September.. 2,402,040.77 600,374.50 March 1,421,173.70 176,912.75 October 1,504,930.15 312,037.75 April 1.596,369.59 231,858.00 November.. 852,338.29 266,717.00 May 942,115.98 225,658.25 December.. 1,098,125.57 185,219.75 June , 3,378,942.23 256,603.00 July 4,059,873.56 211,436.25 Total 22,643,933.29 3,075,045.00 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

SCHEDULE 17.—District Committee on Capital Issues—Summary of work of district committee for period May 17 to Dec. 1, 1918. [A.—Report as to cases involving $100,000 and less, and over which the district committee exercised final jurisdiction.] Classification of applications. N of u a m p b pl e i r Total applied for. Con eq st u r i u p c m ti e o n n t a . nd A c V ap o i r t k a i l n . g Refunding. Exc e h t a c. n ge, Total passed. a T p o p t r a o l v d e i d s . cations. States and subdivisions 84 $2,098,383.37 $1,568,277.88 $397,405. 49 $132,000 $1,849,682.37 $248,701 2 107,000. 00 $32,000.00 75,000.00 107,000. 00 Manufacturing 21 1,495,450. 00 114,000. 00 734,000. 00 278,300. 00 369,150 1,110,450.00 385,000 Development 14 689,265. 00 232,265.00 265,307.22 44,692. 78 147,000 504,000. 00 185,265 Commercial and financial 9 825,000. 00 200,000. 00 325,000. 00 100,000. 00 200,000 625,000.00 200,000 Total 130 5,215,098.37 2,114,542.88 1,356,307.22 895,398.27 848,150 4,193,132.37 1,018,966 H 3 SUMMARY. o Amount. Total applied for $5,215,098.37 O Amount passed involving use of labor and material ^ 1,672, 576.88 Working capital only / 879,307.22 Refunding only 845,398.27 o 3,397,282.37 Securities passed involving no use of capital, labor, or material because issued directly in exchange for property or other securities, or as stock dividends, bonus, etc., < and withheld from sale for period of the war 798,850.00 Disapproved, mostly for new extensions not necessary at this time 1,018,966.00 > 1,817,816.00 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

SCHEDULE 17.—District Committee on Capital Issues—Summary of work of district committee for period May 11 to Dec, 1, 1918—Continued. B.—Report as to cases involving amounts in excess of $100,000.) Number Classification of applications. o c f a t a i p o p n l s i . Total applied for. Con e s q t u r i u p c m ti e on n t. a nd Working capital. Refunding. Exchange, etc. Total passed. a T p o p t r a o l v d e i d s . States and subdivisions 81 $17,066,371.78 $16,248,543.24 $516,728.54 $301,100 $12,967,327.36 $4,099,044.42 Public utilities 18 20,170,300.00 3,120,500.00 $837,000.00 14,582,800.00 1,630,000 19,670,300.00 500,000. 00 Manufacturing 120 109,859,240.00 21,590,825.00 24,229,659.22 22,743,955.78 41,294,800 97,066,100.00 12,793,140.00 Development 45 37,048,700.00 4,287,129.00 8,652,960.09 2,988,239.91 21,120,371 25,554,034.00 11,494,666.00 Commercial and financial 27 14,990,400.00 1,646,149.39 7,079,100.00 5,290,150.61 975,000 9,851,100.00 5,139,300.00 Charitable and miscellaneous 6 1,625,000.00 715,000.00 260,000. 00 650,000 1,425,000.00 200,000.00 Total 297 200,760,011.78 47,608,146.63 40,798,719.31 46,381,874.84 65,971,271 166,533,861.36 34,226,150.42 SUMMARY. Total applied for $200,760,011.78 . Amount passed involving use of labor and material.. 36,301,936.21 Working capital only 27,486,929.31 Refunding only 41,954,924.84 105,743,790.36 Securities passed involving no use of capit al, labor, or material because issued directly in exchange for property or other securities, or as stock dividends, bonus etc., and withheld from sale for period of the war 61,790,071.00 Disapproved, mostly for new extensions no t necessar v at this time 34,226,150.42 96,016,221.42 478 > F EtEPORT O w fel hrj W DERAL RESERVE Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTEICT NO. 4 CLEVELAND. 479 SCHEDULE 18.—Federal Reserve notes issued and redeemed during the year and compara tive statement of outstanding notes, Dec. 31, 1917, and Dec. 31, 1918. 1918 Outstanding Total Denominations. Dec. 31, 1917. outstanding. Issued. Redeemed. Fives $S,947,750 $23,600,000 $5,357,305 $27,190,445 Tens 23,708,060 40,560,000 9,797,080 54,470,980 Twenties 51,865,140 84,560.000 9,803,200 126,621,940 Fifties 15, 700, 750 34,200; 000 2,957,000 46,943,750 Hundreds 5,448,000 7,300,000 1,455,200 11,292,800 Total 105,669,700 190,220,000 29,369,785 266,519,915 SCHEDULE 19.—Federal Reserve bank notes issued and redeemed during the year. Received from Returned for Outstanding Denominations. comptroller. redemption. Dec. 31, 1918. Ones $4,828,000 $36,390 $4,791,610 Twos 1.496,000 1,610 1,494,390 Fives 4,325,000 11,000 4,314,000 Total 10,649,000 49,000 10,600,000 SCHEDULE 20.—Comparative statement of aggregate resources and liabilities of member banks, Dec. 31, 1917, to Nov. 1, 1918. [000 omitted.] Nov. 1, Dec. 31, 1918. 1917. KESOURCES. Loans and discounts ,153,039 $1,000,426 Overdrafts 1,118 736 Acceptances and letters of credit 23,680 12,091 United States securities 220,182 142, *57 Liberty loan bonds 155,617 68,230 All other bonds, securities, etc 396,794 399,027 Banking house, furniture, and fixtures 57,103 50,008 Other real estate 10,802 8,844 Reserve with Federal Reserve Bank 117,770 116,991 Cash and due from banks 296,969 338,349 5 per cent redemption fund 5,541 6 217 Other assets 15, 266 8; 526 Total resources 2,453,881 2,151,802 LIABILITIES. Capital 151,316 137,349 Surplus 145,028 131,300 Undivided profits 49,119 34,350 Circulation 89,590 90,040 Due to banks and bankers 222,290 243,427 Demand deposits 1,003,348 946,092 Time deposits 510,950 443,791 United States deposits 149,202 67,835 Bonds borrowed 16,440 16,151 Bills payable 61,463 16,212 Acceptances and letter? of credit 22,086 12.354 Other liabilities 33,049 12,901 Total liabilities 2,453,881 2,151,802 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

480 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. SCHEDULE 21.—Transit department. CHECK CLEARINGS AND COLLECTION. Number of items. Amount. On Cleveland banks 881,956 $1,786,217,547.85 On other banks in district No. 4 4,746,362 2,105,910,178.52 On banks in other districts 438,570 813,373,736.58 On Treasurer of the United States 499,014 385,598,439.40 6,565,902 5,091,105,902.35 CINCINNATI BRANCH. On Cincinnati banks 609,682 $993,447,932.30 2,572,370 537,365,974.18 On banks in other districts 132, C40 114,375,433.82 On Treasurer of the United States 310,416 61,938,513.26 3,625,108 1,707,127,853.56 PITTSBURGH BRANCH. On Pittsburgh banks 1,045,397 \ $1,761,093,703:81 On other banks in district No. 4.. 2,305,196 409,485,236.35 On banks in other districts 229,569 300,641,668.07 On Treasurer of the United States 177,063 152,975,314.16 3,817,225 2,624,195,922.39 CHECKS DRAWN ON THE TREASURER OF THE UNITED STATES, HANDLED BY THE FEDERAL RESERVE BANK OF CLEVELAND AND ITS BRANCHES DURING THE YEAR. Items. Amount. January 15,768 $11, 084,762.91 February.. 21,621 12, 540, 707. 78 March 29,093 18, 075,472.93 April 25,928 22, 203,979.17 May 54,504 36, 882,427.67 June 111,498 71, 696,690. 78 July 85,892 802,186.09 August 99,838 533,522.98 September. 109,279 63, 555,407.43 October 108,364 75, 135,952.07 November. 112,467 79, 661,089.63 December.. 212,241 340,067.38 Total 986,493 600,512,266.82 VOLUME OF CHECKS HANDLED FOR MEMBERS AND OTHER FEDERAL RESERVE BANKS BY THE FEDERAL RESERVE BANK OF CLEVELAND AND ITS BRANCHES JAN. 1, 1918, TO DEC. 31, 1918. Daily average. Items. Amount. Items. Amount. January ! 627,427 $451,453, 395.05- 25,038 $18,086, 994.60 February ! 572,330 464,392, 761.09 24,883 20,190, 989.22 March... ! 743,355 560,818, 785.17 29, 734 22,432, 751.40 April 822,971 643,767, 572.41 35,121 29,958, 574.97 May ! 876,055 783,553, 182.22 33,693 30,136, 660.85 June I 1,078,471 1,000,772, 488.47 43,138 40,030, 899.44 July | 1,330,669 894,066, 017.25 51,140 34,387, 154.51 August 1,386,509 848,290, 975.43 51,349 31,418, 184. 28 September | 1,379,233 842,543, 702.22 57,458 35,105, 987.59 October ! 1,715,623 1,056,600, 369.28 65,986 40,638, 475. 74 November I 1,591,943 902,534, 907.92 63,677 36,101, 396. 32 December j 1,883,649 973,635, 521. 79 75,347 38,945, 417.87 This schedule includes Government checks scheduled under "checks drawn on Treasurer of the United States." Items handled by both parent bank and branches and duplicated in above schedule, 376,706; amount, $1,159,690,343.29. Total number of items handled, 14,008,235. Total amount handled, $9,422,429,678.30. Disbursements, transit department, $282,198.33. Cost per item handled, 2.01 cents. Cost per $1,000, 3 cents. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 4 CLEVELAND. 481 SCHEDULE 22.—Gold settlement fund operations, Jan. 1, 1918, to Dec. SI, 1918. Debits. Credits. Gain. Loss. Boston $153,442,000 $119,371,000 $34,071,000 New York 1,806,466,000 1,797,280,000 9,186,OCO Philadelphia 600,610,000 524,802,000 75,808,OCO Richmond 244,475,000 218,043,000 26,432,009 86,104,000 79,216,000 6,888, OCO 850,804,000 621,412,000 229,392, OCO St. Louis 261,378,000 264,981,000 $3, ec3, ooo Minneapolis 47,022,000 12,579,000 34,443, OCO Kansas City 86,456,000 34,031,000 52,425, OCO Dallas 43, 752,000 22,225,000 21,527, OGO San Francisco 53,872,000 34,094,000 19, 778,000 Total 4,234,381,000 3, 728,034,000 509,950,000 3,603,000 Gain through settlement $506,347,000 Net loss through transfers 491,886,000 Net gain through transfers and settlemen. 14,461,000 100823°—19- -31 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 5—RICHMOND. CALDWELL HARDY, Chairman and Federal Reserve Agent. FINANCIAL RESULTS OF .OPERATION. The financial results of the operations of the Federal Keserve.Bank of Richmond for 1918 have been most satisfactory. The increase in the productive assets from $46,000,000 on December 31, 1917, to over $97,000,000 on December 31, 1918, is reflected in the earnings for the year. These show a gross increase from $770,000 in 1917 to $2,979,000 in 1918, which, with an increase in expenses from $307,000 to $667,000, results in a corresponding increase in net earnings from $462,000 to $2,300,000. After payment of dividends, there remain^ $2,079,000, one-half of which was carried to surplus, the other half being payable to the Government as a franchise tax. Earnings, dividends, and comparative report of profit and loss are shown in Schedule 1, and expenses in detail in Schedule 2. Schedule 3, comparative balance sheet for December, 1917-18, shows an increase in total assets and liabilities from $111,700,000 to $204,- 800,000. While deposit liabilities show an increase of less than $7,000,000, Federal Reserve notes have increased approximately $81,000,000, from $56,500,000 to $137,478,000. This expansion in Federal Reserve notes is a striking illustration of the elasticity and power of the Federal Reserve system. GENERAL BUSINESS AND BANKING CONDITIONS. The year 1918 was the most prosperous ever enjoyed by the territory comprising this district. The most notable activities are, of course, agricultural. The cotton crop has been the largest ever produced, with one or two exceptions. Prices have averaged in the neighborhood of 30 cents per pound as against a normal average.of about 10 cents, but the cost of producing the present crop has been much greater than usual. Farmers who have sold their crops are in better position than ever before, but much cotton is being held for higher prices. The tobacco crop has been large in acreage and output, South Carolina in particular having increased her acreage considerably. 483 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

484 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. The average price has been in the neighborhood of 30 cents and the return the highest ever received for a tobacco crop. There have been unusual farm developments, transactions in farm lands have increased largely in volume, large farms have been subdivided, and a great deal of money spent for building houses, barns and other buildings. These conditions have been reflected in an unprecendented volume of business and great activity in commercial and banking circles. Labor has been very scarce and inefficient, and wages have been limited only by what has been demanded. Money has circulated freely, the volume exceeding anything ever before known, and has been liberally spent. The money market has been active, and while the supply of credit has been ample for all purposes, the prevailing rate has not fallen below 6 per cent. Bank profits have been satisfactory after providing for heavy Federal taxes. DISCOUNT OPERATIONS. The volume of commercial paper handled during the year, including trade and bankers' acceptances and Liberty loans, is shown on Schedule 4, by quarters, including daily average during the year and balance held on December 31, 1918. The volume classified by States is shown in Schedule 5. The schedules show an increase in the total bills held from $42,800,000, December 31, 1917, to $91,700,000, December 31, 1918. The principal increase has been in loans secured by Govern ment obligations. Discount rates current for the year 1918 are shown in Schedule 6. TRADE ACCEPTANCES. Trade acceptances have been used to an increasing extent, particu larly in financing sales of cotton to mills. The volume of bankers' and trade acceptances actually discounted has been much larger than the average volume held would indicate. Our contingent liability on bills rediscounted with other Federal Keserve Banks on December 31, was $4,787,000. This was due to our rediscounting commercial paper and bankers' acceptances from time to time with other Fed eral Keserve Banks (to an aggregate of $69,000,000 during the year) in order to maintain our reserve on a fair parity with those of other Federal Reserve Banks and at the same time meet the increasing demands of member banks for loans on Liberty bonds and United States certificates of indebtedness. OPEN MARKET FOR ACCEPTANCES. We have maintained an open market for bankers' acceptances originating in this district. Large transactions have been financed by these acceptances to a very considerable extent, particularly in cotton and tobacco. While we have endeavored to see that such Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 5 RICHMOND. 485 acceptances are issued only under legitimate conditions and in con formity with the regulations of the Federal Reserve Board, our policy has been to foster their use. There are 19 banks in the district now authorized by the Federal Reserve Board to issue acceptances to 100 per cent of their total capital and surplus, aggregating $28,000,000. RESERVE POSITION. Schedule 7 shows deposit liability to member banks and to the United States Government, the average increase of deposits of mem ber banks in the past }^ear being from $31,000,000 to $46,000,000, or nearly 50 per cent. Schedule 8 shows average liability by months to member banks and the Government, net deposit liability, net liability in outstanding Federal Reserve notes, net liability to all deposits and Federal Reserve notes combined, amount of legal reserve percentage of legal reserve to net liabilities and percentage of reserve against Federal Reserve notes after allowing 35 per cent reserve against deposit liability. This percentage against Federal Reserve notes shows a decline from a maximum of 80.33 in March to 53.40 in December, with an average of 61.19 for the year, this decline being due to an increase in the volume of loans and a corresponding increase in the amount of Federal Reserve notes outstanding. MOVEMENT OF MEMBERSHIP. National bank and State bank membership is shown in Schedule 9, by States and in total. The number of national bank members has increased 11 in the year—from 517 to 528—and State bank mem bers 23—from 14 to 37. Total stock subscriptions have increased during the year from 73,279 shares (50 per cent paid—$3,663,950) to 81,244 shares (50 per cent paid—$4,062,200). State institutions have been admitted to membership as follows: Liberty Bank of Baltimore County, Arlington, Md. American Bank, Baltimore, Md. Hamilton Bank, Hamilton, Md. Cambria Bank, Cambria, Va. Bank of Christiansburg, Christiansburg, Va. Greensville Bank, Emporia, Va. The Marine Bank, Norfolk, Va. Union Bank, Richmond, Va. Kanawha Valley Bank, Charleston, W. Va e The Franklin Bank, Franklin, W. Va. Battery Park Bank, Asheville, N. C. American Trust Co., Charlotte, N. C. Bank of Commerce, High Point, N. C. Newbern Banking & Trust Co., Newbern, N. 0. Wachovia Bank & Trust Co., Winston-Salem, N. 0. Carolina Savings Bank, Charleston, S. C. Bank of Cheraw, Cheraw, S. C. The Commercial Bank, Chester, S. C. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

486 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. Bank of Darlington, Darlington, S. C. Commercial & Savings Bank, Florence, S. C. Bank of Georgetown, Georgetown, S. C. Peoples Bank, Georgetown, S. C. Nicholson Bank & Trust Co., Union, S. C. Their resources amount to about $62,000,000, capital and surplus $7,580,000, and their stock subscriptions are for 4,551 shares (50 per cent paid—$227,550). RELATIONS WITH NATIONAL BANK MEMBERS. Relations with national bank members have been more extended than ever before and have emphasized the importance of mutual cooperation. The demand for national financing has been met only by the cooperation of all interests, particularly the banks, coordinated through and in turn supported by the Federal Reserve Bank. Commercial and agricultural demands have been unusually large, particularly for carrying cotton, which has moved slowly and is still being largely held. Member banks have expressed their realization of the need for the Federal Reserve system and appreciation of its assistance in meeting this situation, which would otherwise have proved embarrassing. Figures on discounts are shown in Schedules 4 and 5, heretofore referred to. It is hoped during the coming year to promote even closer relations, smoother operation of current business, and the rendering of increas ingly valuable service to our members. The service charge of 1\ cents per item on items outside of Richmond was discontinued after June 15, 1918, and on October 24 we assumed all charges on the shipment between the Federal Reserve Bank and member banks of Federal Reserve notes, Federal Reserve bank notes, and lawful money. We were already bearing the expense of gold shipped to us and Federal Reserve notes given in exchange for gold. Many expres-' sions of appreciation were received from our member banks. FIDUCIARY POWERS. Applications for the exercise of fiduciary powers have been increas ing and those granted are as follows: Date. Name. Location. Powers granted. 1918. Jan. 23 Commercial National Bank High Point, N. C... Trustee, executor, administrator, and registrar of stocks and bonds. Mar. 29 Madison National Bank Madison, W. Va Registrar of stocks and bonds. ( Grant ed permission Aug. 19, 1915, to act as trustee, executor, and adminis trator.) Apr. 1 Peoples National Bank Rocky Mount, Va... Trustee, executor, administrator, and registrar of stocks and bonds. Apr. 15 Commonwealth National Bank. Reedville, Va Trustee, executor, and administrator. May 31 First National Bank Harrisonburg, Va... Do. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 5—RICHMOND. 487 Date. Name. Location. Powers granted. June 26 Fourth National Bank Greenville, S. C Trustee, executor, administrator, and registrar of stocks and bonds. June 26 First National Bank York, S. C July 25 ....do Chatham, Va Trustee, executor, and administrator. Aug. 24 do New Windsor, Md.. Trustee, executor, administrator, and registrar of stocks and bonds. Pec. 2 Second National Bank Baltimore, Md Trustee, executor, administrator, regis trar of stocks and bonds, guardian of estates, assignee, receiver, committee of estates of lunatics. Dec. 6 First National Bank Clifton Forge, Va.... Trustee, executor, administrator, regis trar of stocks and bonds, guardian of estates, and assignee. RELATIONS WITH STATE BANKS AND TRUST COMPANIES. The examinations of State institutions by their own banking departments have been recognized and accepted in applications for membership. We hope to carry such cooperation further, to the mutual advantage of the State banking departments, our State bank members, and ourselves. Of the nearly 1,500 State institutions in this district, only about one-third have the capital required for eligibility in the Federal Reserve system. Membership has received some consideration during the year among those eligible, but not to the extent desired. The President's appeal received some consideration, but was mini mized as only a war incident, without due appreciation of our future responsibilities and increasing need for coordinating all our financial power. STATE LAWS ON RESERVES AND BANKERS' ACCEPTANCES. The following data relate to State laws regulating reserves required of State institutions, and power to issue bankers' acceptances; also proposed amendments regarding these powers, particularly as to reserves required of State institutions joining the Federal Reserve system: Maryland.—Banks of discount and deposit must keep on hand a reserve fund of 5 per cent of demand deposits in cash and 10 per cent in cash or reserve balances. Trust companies must keep on hand a reserve fund of 10 per cent of demand deposits in cash or in reserve balances and an additional 5 per cent in cash, reserve balances, or in registered bonds of the United States, Maryland, City of Baltimore, or some county or municipal corporation of Maryland. Member banks are required to keep only such reserves as are prescribed by the Federal Reserve Act. North Carolina.—Every banking institution must keep on hand a reserve fund of 6 per cent of its total deposits in cash and an additional 9 per cent in cash or reserve balances. We have sug gested an amendment permitting member banks to keep only such reserves as are required by the Federal Reserve Act. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

488 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. South Carolina.—No reserve is required of State banks. Virginia.—No reserve is required of State banks. West Virginia.—All banking institutions are required to keep on hand a reserve of at least 6 per cent of their demand deposits in lawful money and an additional reserve of 9 per cent in lawful money or reserve balances. We have suggested legislation which will permit member banks to keep only such reserves as are required by the Federal Reserve Act. District of Columbia.—The provision of the Federal Reserve Act covering reserves applies to members in the District of Columbia. BANKERS' ACCEPTANCES. In Virginia and Maryland banks are authorized by State statutes to accept drafts growing out of transactions involving the exporta tion and importation, domestic storage or shipment of goods, sub stantially to the same extent that this power is given national banks by the Federal Reserve Act. Trust companies of the District of Columbia which are members have the power to accept drafts by virtue of the provisions of the Federal Reserve Act itself. In West Virginia, North Carolina, and South Carolina banks have no power to accept drafts drawn upon them, but in all of these States we have suggested legislation which will give them this power. FISCAL AGENCY OPERATIONS. The general scheme of organization for the third and fourth Liberty loans was practically the same as that adopted in the first and second loans—that is to say, the governor of the Federal Reserve Bank was chairman of the district organization, consisting of the chairmen of the central Liberty loan committees of the several States and the publicity chairman of the district. The State committees consisted of members from the various important sections of each State, representing varied forms of industry. It was decided that the county should be made a unit of the organi zation, which had not been done in previous loans, the chairmen for the counties being appointed by the State chairmen, subject to the approval of the district chairman. Each of the county chairmen appointed committees to look after the publicity, the soliciting of subscriptions, and the handling of all work in connection with loans in their respective counties. District chairmen were appointed by several of the State committees to supervise the work in groups of counties. Before the beginning of each loan, the majority of States held con ferences of their Liberty loan workers, and plans of organization were thoroughly worked out and definitely decided upon. All of the Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 5—BICHMOND. 489 chairmen were volunteers, quite a number of whom not only con tributed liberally of their time, but also paid all expenses incident to their work. The publicity committee for the district had its headquarters in Kichmond, and the chairman of this committee had associated with him a chairman to look after the newspaper work, a chairman of a wholesale trade committee to work through the big wholesale houses of the district, and a chairman of a retail trade committee to handle similar work through the retail stores. The speakers' bureau for the fifth district had its headquarters in Washington, and arrangements for speakers for the different States were made by the chairman of that bureau direct with the State chairmen. Through this bureau the message was carried to the churches, schools, theaters, factories, and public gatherings. Apportionments to each of these loans were assigned to each indi vidual banking institution and trust company in the district, based on total banking resources, as of December 31, 1917, the latest figures available, the county apportionments being based on banking resources and population. The fifth district's quota for the third loan was $130,000,000, and the total subscriptions aggregated $186,259,050, an oversubscription of 43 per cent. The individual subscribers numbered 858,358. The district's quota in the fourth loan was $280,000,000, a sum which seemed staggering at the outset, but when the last subscription was received, the total had mounted to $352,685,200, an oversubscription of 26 per cent, which was exceeded only by the Boston district. The number of subscribers to the fourth loan was approximately 1,226,000. Subscriptions during 1918 for United States tax certificates and certificates in anticipation of the third, fourth, and fifth Liberty loans and for the third and fourth Liberty loan bonds are shown in Schedule 10. This gives the total number of banks in the district, the number of banks subscribing, the amount of subscriptions, payments made in cash and by credit in the war loan deposit account. Certificates sold totaled $267,398,500, and third and fourth Liberty loan bonds sold amounted to $538,944,250, making the total of Government securities sold during the year $806,342,750. The deposit of Treasury funds with subscribing banks in the war loan deposit account and the gradual withdrawal of these funds as needed has made it possible to handle Government business without disturbance in the general financial situation. Sales of war-savings stamps and thrift stamps during the year have aggregated $10,926,000, as shown in Schedule 11. The opportunity for loans offered by the War Finance Corporation has been availed of through us in only one case. This was a loan for Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

490 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. $8,000 to the Bank of Youngs ville, S. C, about September 30. It was secured by customers7 notes for $11,000, secured by an equal amount (par value) of Liberty loan bonds, and was paid about December 12. THE CAPITAL ISSUES COMMITTEE. The Federal Reserve Board appointed three of its members as the Capital Issues Committee, and these gentlemen, acting with an advi sory committee, requested all persons issuing securities in amounts exceeding $500,000 to submit their applications to the committee and be guided by its advice as to whether it was compatible with the national interest to issue the securities. In order to facilitate the work of the committee, it appointed district committees, whose duty it was to investigate and report upon the issues of securities submitted to the Capital Issues Committee. Each of these district committees was composed of the chairman of the board of the Federal Reserve Bank, the governor of the Federal Reserve Bank, and other members selected from among the bankers and business men of the district. The district capital issues committee appointed for the fifth district was as follows: DISTRICT COMMITTEE. ASSOCIATE MEMBERS. Caldwell Hardy, chairman, Richmond, B. H. Griswold, jr., Baltimore, Md. Va. Waldo Newcomer, Baltimore, Md. George J. Seay, vice chairman, Rich- John Joy Edson, Washington, D. C. mond, Va. E. E. Thompson, Washington, I). C. E. L. Bemis, Richmond, Va. John L. Dickinson, Charleston, W. Va. Herbert W. Jackson, Richmond, Va. Col. F. H. Fries, Winston-Salem, N. C. John M. Miller, jr., Richmond, Va. George A. Holderness, Tarboro, N. C. S. T. Morgan, Richmond, Va. John A. Law, Spartanburg, S. C. Frederic W. Scott, Richmond, Va. R. G. Rhett, Charleston, S. C. This same committee continued to serve after the passage of the War Finance Corporation Act. That act required the Capital Issues Committee to pass upon all securities when the amount of such securities, together with all other securities issued by the same issuing principal since April 5, 1918, exceeded $100,000. The committee required all applicants to submit their applications simultaneously to the Capital Issues Committee and to the district committee, which latter committee investigated and reported to the Capital Issues Committee. The district committee, in carrying out its duty to investigate, referred the application to its nonresident committeeman nearest to the applicant's place of business, and also wrote to bankers and others, inquiring into the financial and personal standing of the applicant and the economic and industrial condition in the vicinity in which he proposed to operate. The report of the examining committeman and all other data was then submitted to the resident committeemen, who met weekly in the Federal Reserve Bank, and a report was forwarded to the Capital Issues Committee. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 5 RICHMOND. 491 As the need of conserving capital became more pressing during the summer, the Capital Issues Committee requested persons issuing securities in amounts less than $100,000 to submit their plans to the district committee and be guided by its judgment. Submission of these smaller amounts was entirely voluntary, but almost all parties to whose attention this request was brought gladly acceded to it, and the district committee passed upon 42 applications of this class, the larger number of which were by cities and towns issuing small blocks of securities. A statement showing the number of applications submitted and the action taken on them is given below; also an analysis showing the amount of securities approved and the reasons for their approval, and also the amount disapproved: Applications on by the district committee. Involving Involving over $100,000 $100,000. or less. Private corporations- Approved Approved in part.., Disapproved 2 Unfinished 5 Municipal subdivision: Approved 20 Approved in part... 2 Disapproved 6 Total. Securities acted on by the district committee. Involving more than $100,000. Involving $100,000 or less. Approved. Disapproved. Approved. Disapproved. Private corporation, essential mining, manufac turing, or agriculture.. „ $16,538,300 $110,000 Public utilities, housing, hotels, etc 14,242,600 75,000 Mercantile, banking, and general purposes 3,323,900 50,000 Refunding, reorganizations involving no new capital 28,145,000 141,000 Incompatible with national interest $68,030,310 $229 300 States and subdivisions, necessary for public welfare 4,135,000 434,900 Refunding 1,628,000 353,000 Nonessential 1, 628,000 320 000 Total 68,012, 800 69, 65S, 310 1,163,900 549,300 Total refunding 29, 773,000 494,000 Total new issues 38,239, 800 69,658,310 669,900 549,300 The above tabulation shows the securities approved or disapproved prior to November 11. After that date the committee in some measure relaxed the strictness of its ruling, and many applications previously disapproved were reconsidered and approved. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

492 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. On December 31 the Capital Issues Committee suspended its operations, feeling that the emergency was in some measure past and that it was better that the public be freed from restriction, imposed upon business expansion and left to determine for itself what expansion was proper and what should be deferred. NOTE ISSUES. Schedule 12 gives a complete record of the issue and redemption of Federal Reserve notes, the amount in circulation December 31, 1918, as shown by the general balance sheet, being $137,478,000. Federal Reserve bank notes in circulation December 31, 1918, amounted to $4,005,500. These are secured by the deposit with the Treasurer of the United States of— One year United States 3 per cent Treasury notes $899, 000 United States 2 per cent certificates (special) 3, 885, 000 Total 4, 784, 000 These Federal Reserve bank notes are issued only in $1 and $2 denominations, and for the purpose of replacing silver certificates, these latter being retired in order to facilitate Treasury transactions in silver. POSITION OF COMMERCIAL BANKS AS RESULT OF FINANCING. As war financing has progressed and increased, rediscount applica tions filed with the Federal Reserve Bank by those member banks which have participated in it have, as a rule, also increased in some what the same ratio. The volume of rediscounts against United States certificates and bonds and against commercial paper held by the Federal Reserve Bank can hardly be accepted as an accurate index of the relative borrowing by the banks for participation in Government financing and for commercial uses. Banks which have paid for bonds in full out of their own resources and have later needed funds for commercial purposes, have undoubtedly borrowed against their bonds instead of rediscounting commercial paper be cause of the lower rate obtained on bond-secured obligations. While the rediscount lines of banks which have participated in Government financing have increased, many of them to large amounts, commercial needs have been liberally taken care of. In fact, in many cases, commercial credits apparently have not only been not restricted, but have been unduly liberal, and we have felt it judicious to offer cautions against this practice. The slow marketing of the cotton crop and the disposition of farmers to hold for higher prices, which in many cases have seemed unreasonable, have been potent factors in this situation. As domestic mills have been fully supplied, however, and the surplus held represents what would under normal Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 5—RICHMOND. 493 conditions have been exported, it is a question whether a larger volume of the crop could have been marketed without forcing an earlier and larger decline in prices. While the cotton situation has obstructed customary liquidation and the credit situation is there fore abnormally extended at the close of the year, the cotton is on hand as an asset. Its value may be undetermined as yet, but dis tribution by export to countries where it is needed must come on some basis, and the result, whatever it may be, will be accepted and absorbed. POLICY TO BE PURSUED IN RESTORING LIQUIDITY OF BANKS. Those banks which purchased bonds themselves and induced their customers to do so by agreeing to carry them, have, as a rule, gone as far in this direction as is judicious. At present prices, liquidation of war paper would entail considerable losses, and public sentiment does not approve of forced liquidation under such circumstances. This is particularly true in view of the coming campaign for the fifth war loan. The terms of this loan will have an important bearing on present bank war obligations. This will necessarily delay liquida tion of the present situation. Under these conditions, the Federal Reserve Bank must shape its policy toward member banks as daily conditions may arise. These being unknown, it is problematical as to how soon war paper can be cleared up. The volume of this paper, together with cotton paper, is so large that it will probably need the proceeds of another crop to relieve the undigested condition. OPERATIONS OF FEDERAL RESERVE BANK BRANCH. A branch at Baltimore, Md., was opened for business March 1, 1918, with the following officers and directors: Officers: M. M. Prentis, manager; Charles H. Wyatt, cashier; Charles N. Duley, assistant Federal Reserve agent, and auditor. Directors: M. M. Prentis; Charles C. Homer, jr., president of the Second National Bank and the Savings Bank of Baltimore; William Ingle, president Baltimore Trust Co.; Waldo Newcomer, president National Exchange Bank; H. B. Wilcox, vice-president Merchants- Mechanics-First National Bank. The building formerly occupied by the Mechanics National Bank at the corner of South and German Streets was purchased for the use of the branch at a cost of $200,000. The building was originally designed for a banking house, and its arrangement is admirably adapted to this purpose. Mr. Henry Schutz was appointed in June as assistant Federal Reserve agent and assistant auditor. In December, Mr. Frank McL. Leeke, formerly head teller, was appointed assistant cashier. The board of directors was reappointed to serve for 1919 and the Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

494 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. official staff who are to serve for the coming year are as follows: Charles N. Duley, assistant Federal Reserve agent and auditor; Henry Schutz, assistant Federal Reserve agent and assistant auditor; M. M. Prentis, manager; Charles H. Wyatt, cashier; Frank McL. Leeke, assistant cashier. The operation of the branch at Baltimore has been most satisfac tory to the banks of that city and State. Before its establishment, member banks in the city of Baltimore, in order to make checks on them available for immediate credit in Richmond, were obliged to keep excess balances (over and above required reserve) to an amount equal to the volume of checks for one or two days. As the checks on these banks are now sent direct to the Baltimore branch (but settled for through Richmond, as before) by other Federal Reserve Banks, the Baltimore banks have been relieved of the considerable burden of carrying excess available balances. While discounts made by the branch are forwarded to Richmond, subject to approval, immediate credit is given in Baltimore and cur rency supplied at once against such credit when needed. The total volume of discounts since its establishment March 1, 1918, is shown on Schedule 13, and amounts to $263,000,000. The branch has taken over the Baltimore Country Clearing House and has cleared a total of 3,100,000 items, averaging 12,700 items daily, and amount ing to $2,066,000,000, a daily average of $8,467,000, as shown in Schedule 14. INTERNAL ORGANIZATION. Our 254 officers and employees are classified in Schedule 15, and the increase in the number for the years 1916-17-18 is a fair index of the great growth of the business of the bank. Every department of the bank has been extended and organized with a view to efficiency and the prompt handling of the enormous volume of business com mitted to it. During the year the following additions to the official force have been made: W. W. Dillard, assistant cashier; Maxwell G. Wallace, assistant counsel; J. G. Fry, assistant Federal Reserve agent; W. E. Cadwallader, comptroller; R. H. Broaddus, deputy governor. Mr. Edmund Strudwick, of Richmond, Va., was reelected class B director, and Mr. Charles E. Rieman, of Baltimore, Md., was elected class A director to succeed Mr. H. B. Wilcox, who declined reelection. The official staff and directors who are to serve for the coming year are as follows: Officers.—Caldwell Hardy, chairman of the board and Federal Reserve agent; A. H. Dudley, assistant Federal Reserve agent; J. G. Fry, assistant Federal Reserve agent; George J. Seay, governor; Charles A. Peple, deputy governor; R. H. Broaddus, deputy governor; Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 5—RICHMOND. 495 George H. Keesee, cashier; C. V. Blackburn, assistant cashier; Thomas Marshall, Jr., assistant cashier; W. W. Dillard, assistant cashier; W. E. Cadwallader, comptroller. Directors. Occupation. Residence. Class A: J. F. Braton President First National Bank.. . Wilson. N. C. E dwin Mann do Bluefleld, W. Va. Charles E. Rieman President Western National Bank Baltimore, Md. Class B: James F. Oyster Merchant Washington, D. C. D. R. Coker Merchant and planter Hartsville, S. C. Edmund Strudwick.. - - President Atlantic Life Insurance Co Richmond, Va. Class C: James A. Moncure Do. Caldwell Hardy Chairman and Federal Reserve agent Do. Howard Bruce President Bartlett-Hayward Co Baltimore, Md. CLEARINGS. Schedule 16 shows clearing operations for the year. Over 12,000,000 items were handled, averaging nearly 40,000 daily, with an aggregate of over $7,113,000,000 and a daily average of over $23,000,000 for 304 business days. This large volume was handled promptly, accurately and without loss, and, after June 15, without any charge to members for service. COLLECTIONS. Collection items handled were negligible in number and amount, the services of the bank in this direction not having been availed of to any extent by its members. GOLD SETTLEMENT FUND. The establishment of a leased-wire system between the Federal Reserve Board at Washington and the 12 Federal Reserve Banks, affording prompt intercommunication, has greatly facilitated the the prompt and efficient handling of business. Daily settlements through the gold settlement fund have proved efficient. Our transactions through this fund, maintained in Washington under the control of the Federal Reserve Board, and under the custody of the Treasurer of the United States, have reached the totals of $1,633,232,342 in receipts and $1,641,094,813 in payments. These have been handled by bookkeeping entries without moving a dollar of actual gold, but with the same efficiency as if the coin had been actually handled. •BANKING QUARTERS. The bank is occupying at present two store buildings (partially three and four stories) Nos. 1107 and 1109 East Main Street. The quarters are crude and insufficient and afford a very undesirable fire Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

496 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. risk. It has been necessary to make extensive alterations at a cost, which, at best, has afforded very inadequate results. Vault facilities, even with a considerable expenditure, are still very unsatisfactory. In addition to these two buildings, we have maintained another office at No. 1016 East Main Street for our bond delivery department, and during the Liberty loan campaigns, we have found it necessary to rent additional quarters outside. A suitable and very desirable site for a new building was purchased nearly two years ago at the corner of Franklin and Ninth Streets, facing Capitol Square. The lot is 93 by 120 feet, with streets on two sides, a 20-foot lane on the third side, and the fourth side will also be left open for light, air, and fire pro tection by a vacant space. The location is one short square from the financial center of the city at the corner of Ninth and Main Streets. Plans and specifications have been procured for an adequate and attractive building, particularly designed for good light and efficiency and the early erection of such a building is contemplated. SPECIAL DEVELOPMENTS IN THE DISTRICT. Agriculture, manufacturing, trade and banking have been at highwater mark throughout the district during the year. Products include cotton, tobacco, corn, wheat, and other grain; peanuts, truck crops of vegetables and fruits of infinite variety; cattle and hogs; cotton mill products, fertilizers, oil, canned goods and packing house products; coal, iron, and the commodities usually embraced in general trade. Special developments in the Tidewater section have been unprecedented. ' The Bethlehem Steel Co. is estimated to have spent $30,000,000 at its Sparrows Point shipyard, near Baltimore. The production of ammunition at various plants in and around Baltimore has been almost beyond computation. The Newport News Shipbuilding & Dry Dock Co., at the entrance of the James River into Hampton Koads, has had over 10,000 men on its pay roll, and has been exten sively engaged in Government and other shipbuilding. Government camps extend for 20 miles out of Newport News along the Chesapeake & Ohio Railway toward Richmond, and the volume of shipping at Newport News has crowded its facilities. The Du Pont Co. has had powder plants on the James River and York River, producing millions of pounds of explosives. In addition to the Norfolk Navy Yard on the Elizabeth River, the greatest (permanent) naval base in the country has been established on Hampton Roads below Norfolk, and contiguous to it, extensive docks and an Army base. Norfolk has doubled its population, which Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 5—RICHMOND. 497 Army camps of enormous size have been located near Baltimore, Md. Petersburg, Va., Charlotte, N. C, Columbia and Spartanburg, ; S.C. While a considerable volume of these activities will cease with peace, the Tidewater plants are mostly permanent, and Chesapeake Bay, Hampton Roads, and their tributaries will be the locus of great future shipping activities, naval and commercial, served as it is by eight trunk line railroads—Pennsylvania, Norfolk & Western, Virginian, Southern, Seaboard Air Line, Atlantic Coast Line, Chesa peake & Ohio, and Norfolk-Southern. EXHIBIT A.—Movement of principal earning assets of the Federal Reserve Bank of Rich' mono1 during the calendar year 1918. [In thousands of dollars; i. e., 000 omitted.] 0) (2) (3) (4) (5) (6) (7) Dis counted Bills Total b s y p e c a U u p . r e e r S d . O c p t o h a u e p n r e t d e r. d i s 1+2. m i b n o a u o rk p g e e h n t t . b c i o l a u ls n n d d t e i d s Pe 1 r - c 5 e . nt e a a T s r o s n e t i a t n s l g . war ob bought. ligations. 10,547 16.539 27,086 13,829 40,915 25.8 44 145 11 7,900 15,628 23,528 13,780 37,308 21.2 40,520 18 11,197 21,864 33,061 12,586 45,647 24.5 48,989 25 11,892 20,362 32,254 13,403 45,657 26.0 48,923 Feb 1 11,644 18,677 30,321 14,368 44,689 26.1 48,493 8 10,641 17,808 28,449 12,968 41,417 25.7 44,648 15 12,300 22,539 34,929 3,264 38,193 32.4 41,393 21 13,491 21,625 35,116 3,497 38,613 34.9 41,826 11,941 19, 780 31,721 4,293 36,014 33.2 39,241 8 12, 755 19,529 32, 284 5,555 37,839 33.7 41,066 15 12,573 16,081 28, 654 6,939 35, 593 35.3 38, 820 22 13,046 18,244 31,290 8,625 39,915 32.7 43,142 29 14,299 22,182 36,481 9,588 46,069 31.0 49, 296 14.872 22,759 37,631 11,371 49,002 30.3 51 773 12 17,051 22,690 39, 741 12, 701 52,442 32.5 55' 213 19 20,383 20,408 40, 791 4,191 44,982 45.3 47'753 26 25,064 22,269 47,333 5,177 52,510 47.7 55,266 May 3 25,966 25,235 51,201 5,020 56,221 46.2 58,977 10 24,553 27,084 51,637 5,695 57,332 42.8 60,089 17 27,232 19,101 46,333 1,893 48,220 56.5 50 983 24 26,493 19,565 46,058 2,494 48,552 54.6 5i; 309 31 28,638 20,3S9 49,027 2,797 51,824 55.3 54 581 23,802 25,753 49,555 3,512 53,067 44.9 55, 824 14 29,991 21,610 51,601 4,244 55,845 §3.7 58,602 July 2 2 2 1 1 5 1 6 8 9 9 2 3 2 2 3 3 3 2 2 3 7 7 3 0 3 2 1 , , , , , , , , 4 4 4 1 2 7 8 7 6 6 1 3 0 8 9 4 9 4 1 5 7 8 1 0 3 3 2 2 3 2 2 3 4 0 1 0 9 9 9 0 , , , , , , , , 7 7 5 3 8 0 2 6 6 0 8 4 0 2 7 0 9 5 6 6 6 1 8 5 5 5 5 5 5 5 6 6 8 7 3 9 8 3 0 4 . ' , , , , , , , , 8 1 2 4 3 9 4 7 1 1 7 8 9 0 7 6 0 6 5 5 3 4 7 1 4 2 3 3 3 6 6 7 , , , , , , , , 1 6 0 2 1 9 7 0 1 1 2 2 5 4 7 7 8 8 1 1 8 6 7 2 - 5 5 6 6 6 6 7 6 2 6 0 6 1 3 1 9 > , , , , , , , 9 6 8 9 4 2 8 0 8 9 4 6 2 5 9 9 2 3 3 5 8 0 6 5 3 4 4 4 4 5 3 4 5 7 4 5 8 7 7 6 7 4 . . . . . . . . . 4 9 7 5 5 8 3 3 5 5 6 5 6 6 6 7 7 9 4 3 4 6 9 2 4 " , , , , , , , , 0 5 2 7 6 6 6 3 4 9 0 2 3 1 7 9 0 6 9 5 6 3 1 9 16 32, 959 22,475 55,434 4,988 60,422 54.5 63,165 23 33,853 22, 714 56,567 5,588 62,155 65.'6 64,898 30 41,587 17,055 58,642 4,742 63,384 65.6 66,127 Sept. 6 45,187 19,020 64,207 4,649 6S,856 69.7 71,599 13 51,048 17,656 68,704 4,548 73,252 67.8 75, 995 20 47, 726 18,100 65,826 4,600 70,426 67.5 73 169 27 48,751 18,921 67,672 4,586 72,258 69.0 75 001 Oct. 4 52,414 18,702 71,116 4,866 75,982 69.0 7S, 726 10 49, 945 17,373 67,318 5,020 72,338 70.2 75,082 18 51,948 15,776 67, 724 6,320 74,044 64.3 76, 788 25 44,710 16,910 61,620 7,936 69,556 67.6 72,075 59,780 18,885 78,665 9,761 88,426 68.6 92,445 8 65,348 20,197 85,545 9,660 95,205 69.9 99,224 15 69,728 20,412 90,140 9,661 99,801 77.0 103,820 22 69,306 18,049 87,355 2,657 90,012 75.2 94,031 65,683 18,956 84,639 2,724 87,363 91,881 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

498 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD, FEDERALRESERVE RANK OF RICHMOND. MOVEMENT OF EARNING ASSETS DUR/N6 THE CALENDAR YE4R/9/S. Currcf: TtiirXbanJhfier. G&rre2:Jotal$iUs8isc0tznted,. t fil Gxrve>3:53itts discounted, ajuiSovujht;. PS /20\ no \eo\too \\ss- 90 ho- SO MS- 70 ho\ 60 \\3Sho SO p* 40 \& \30 \20 \/o 4II132SISISZII4 ISa29SZi3263lOI7»3t7l42lBSI2l3Xl9 !6B306Q202?4M8X18tS22296!320ZP\ JAN.\r£B\ MCH.\APR.\MAT \JUNeUUir\/fU6.\SEPr\ OCT. I NOV. I D£C. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. RICHMOND. 499 EXHIBIT B.—Movement of cash reserves, net deposits, Federal reserve note liabilities, and the reserve percentage of the Federal Reserve Bank of Richmond during the calendar year 1918. [In thousands of dollars, i. e., 000 omitted.] (1) ' (2) (3) (4) (5) Ratio of cash re T r o es ta e l r v c e a s s . h dep N o e s t its. c F i i . n r R c a u . c l n a tu t o i a t o e l n s . 2+3. n a e s n t e d r d v F e e . s p o t R s o . i t note lia bilities, combined. Jan. 4 60,403 46,559 54,448 101,007 59.8 11 57,783 41,844 53,046 94,890 60.9 18 49,843 44,010 51,248 95,258 52.3 25 47,193 39,251 53,143 92,394 51.1 Feb. 1 53,656 46,097 52,282 98,379 54.5 8 48,549 36,770 52.610 89,380 54.3 15 50,004 34,513 53,079 87,592 57.2 21 52,445 37,015 53,415 90,430 58.0 Mar. 1 54,957 37.116 53,367 90,483 60.7 8 58.092 41,783 53,508 95,291 61.0 15 62,505 41,142 56,363 97,505 64.1 22 57,486 38,499 58,339 96, 838 59.4 29 54,379 38,135 61,592 99,727 54.5 Apr. 5 57.093 43,551 61,307 104,858 54.4 12 51,168 41,097 bl, 248 102,345 50.0 19 53,249 34,361 62,536 96,897 55.0 26 50, 729 40,411 61,580 101,991 49.7 May 3 50,285 38,673 66,558 105,231 47.8 10 55,479 44,885 66,658 111,543 49.7 17 59,260 38,035 67,981 106,016 55.9 24 65,583 44,563 68,281 112,844 58.1 31 65, 870 48, 732 67.611 116,343 56.6 June 7 59, 786 41,370 70,016 111,386 53.7 14 54,915 38,139 71,043 109,182 50.3 21 57,667 41,153 71, 745 112,898 51.1 28 56,463 37,165 74,525 111, 690 50.6 July 5 54,919 38,520 76,478 114,998 47.8 12 61,087 45,264 76,128 121,392 50.3 19 57, 765 39,717 77,316 117,033 49.4 26 59,937 43,904 78,819 112,723 48.8 Aug. 2 53,954 39,861 81,563 121,424 44.4 9 58,138 44,309 84,433 128,742 45.2 16 69, 612 41,014 86,950 127,964 54.4 23 74,318 46,780 87,767 134,547 55.2 30 ... 77,086 46,452 92,316 138,768 55.6 Sept. 6 75,862 46,046 96,678 142,724 53.2 13 78,376 48,992 100,450 149,442 52 4 20 79,565 45,888 102,003 147,891 53 8 27 83,025 47,588 105,499 153,087 54 2 Oct. 4 85,832 45,955 113,258 159,213 53.9 10 90,863 44,183 116,401 160,584 56 6 18 98,056 50,300 118, 797 169,097 58.0 25 100,172 49,125 118,810 167,935 59.6 Nov. 1 90,167 1 54,923 122,088 177,011 50.9 8 82, 793 i 45,528 130, 770 176, 298 47 0 15 83,147 49,297 132,122 181,419 45.8 22 81,392 37.117 131,960 169,077 48.1 29 91,572 41,920 134,467 17o, 387 51.9 Dec. 6 94,944 | 49,589 135,386 184,975 51.3 13 86,017 | 42,116 135,667 177, 783 48.4 20 85,636 40,141 138, 682 178,823 47.9 27 88,234 35,285 138,118 173,403 50.9 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

500 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. EEDERALRESERVE BANK OFRICHMOND. DEPOSIT AND NOTE LIABILITIES, ALSO CASH RESERVES, DURING THE CALENDAR YEAR 1918. Gzrrel:JfedjC)cfiosCts. Carve 2;Jotal Cask jfeserves. CbLTyeJcJtgqregajteJYet&e^itan&J^ CUrve4:SZa£co ofCashJleserves toJfggregcrfe J(et8ejiostt and, Sft.Jfete /labilities. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 5—RICHMOND. 501 SCHEDULE 1.—Earnings, dividends, and comparative profit and loss. 1918 1917 Gross earnings: On loans and investments S2, 747,492.79 $716,340. 78 Profits on United States securities sold 16; 711.75 Service charges (net over transit expenses) Service charges (collected Jan. 1 to June 15,1918). 49,064.71 Penalties for deficiencies in reserve 122,653.93 31,362.02 Miscellaneous 59,836.11 1,207.69 • $2,979,047.54 • $770,008.93 Deduct— Expenses 653,820.07 257,785.67 Reserve for depreciation in United States securities 13,198.00 50,000.00 667,018.07 307,785.67 Net profit for the year 2, 312,029.47 462,223.26 Balance in undivided profits, Jan. 1,1917.. 11,664.70 473,887.96 Dividends paid: 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 6 per cent Dec. 31, 1917, to June 30,1918. 112,844.20 6 per cent July 1, 1918, to Dec. 31,1918... 119,458.71 Interest paid on stock surrendered 129.03 232,431.94 Balance available for surplus and franchise tax.. 2,079,597.53 232,943.46 Deduct— Franchise tax paid to United States Gov ernment , 1,039,798.76 116,471.73 Carried to surplus account 1,039,798.77 116,471.73 2,079,597.53 232,943.46 SCHEDULE 2.—Expenses for the year 1918. Particulars. Current. Total. Assessments account of expenses Federal Reserve Board $19,814.43 $19,814.43 Federal Advisory Council (fees and traveling expenses) 150.00 150.00 Governors' conferences (including traveling expenses) 209.70 209. 70 Federal reserve agents' conferences (including traveling expenses) 321.12 321.12 Salaries: Bank officers 41.358.73 17,095.91 48,454.64 Clerical staff 122,994. 92 50,122.90 173,117.82 Special officers and watchmen 3,429.04 1,438.50 4,867.54 All other 4.180.54 827.55 5,008.09 Directors: Fees 3,320.00 3,320.00 Per diem allowance 680.00 680.00 Traveling expenses 1,218.32 1,218. 32 Officers' and clerks' traveling expenses 2.514.55 3,014.55 Legal fees 1,122.26 1,122.26 Rent 4,658. 50 547.50 5,206. 00 Taxes and fire insurance 1,822. 71 1,822. 71 Telephone 1,743.41 367.06 2,110.47 Telegraph 2,822.07 138.30 2,960.37 Postage 13,592. 75 31,925.78 45,518.53 Expressage 9,092.72 674.27 9,766. 99 Insurance and premiums on fidelity bonds 7,997.32 466.79 8,464.11 Light, heat, and power 5,125.20 1,523.08 6,648.28 Printing and stationery 28,521.31 7,994.37 36,515.68 Repairs and alterations 10,201.08 2,074.37 12,275.45 All other expenses 12.514.74 3,164. 76 15,679.50 Total expenses of operation 299,405.42 108,861.14 408,266. 56 Cost of Federal reserve currency issued by bank 118,821.84 118,821.84 Miscellaneous charges account of note issues 6,699. 91 6,699.91 Depreciation in furniture and equipment 66,353.64 91,786.51 Depreciation in bank premises 28,245.25 28,245.25 Total current expenses 519,526.06 134,294.01 653,820.07 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

502 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. SCHEDULE 3.—Comparative balance sheets (condensed). Dec. 31, 1918. Dec. 31, 1917. ASSETS: Cash: Gold reserve $85,175,274.60 $62,342,094.65 Legal tender, silver, etc 223,543.45 164,264.85 Total reserve. 85,398,818.05 62,506,359.50 Other cash and cash items 11,494,650.94 597,613.72 Total cash... $96,893,468.99 $63,103,973.22 Transit items, net 9,304,775.33 2,395,561.04 Overdrafts 168,622.52 50,074.18 5 per cent fund against banknotes 309,900.00 Productive assets: Loans and bills purchased , 91,706,438.88 42,812,846.02 United States Gov ernment securi ties 6,018,200.00 3,205,450.00 Par values.. 97,724,638.88 46,018,296.02 Add accrued inter est receivable 22,159.86 21,575.24 97,746,798.74 46,039,871.26 Deduct— Reserve for de preciation in United States bonds $63,198.00 $50,000.00 Unearned dis count 190,567.40 100,204.38 253,765.40 150,204.38 Liquid values| 97,493,033.34 45,889,666.88 Real estate, furniture and equipment , 290,000.00 309,065.24 Deferred charges 4,915.53 Advances to Govern ment committees 345,436.19 43,221.74 640,351.72 352,286.98 204,810,151.90 111,791,562.30 LIABILITIES: Federal Reserve notes outstanding, net 137,478,030.00 56,563,805.00 Federal Reserve bank notes outstanding, net 4,005,500.00 Deposits: Treasurer of United States , 2,795,094.97 2,253,761.15 Members' reserves 54,161,937.72 45,356,855.67 Cashier's checks— 111,319.95 192,256.97 Reserve for fran chise tax 1,039,798.76 Other Federal Re serve banks, net., 3,644,461.78 • 58,108,151.40 51,447,335.57 Liability to s h a r e -| holders: Capital stock 4,062,200.00 3,663,950.00 1,156,270.50 116,471.73 Surplus 5,218,470.50 3,780,421.73 204,810,151.90 111, 791,562.30 Due from depositarybanks and payable to United States Treas urer (special account). 20,500,680.07 24,474,683.36 Contingent liability in bills rediseounted with or sold other Federal Reserve Banks , 4,787,079.38 Percentage of reserves to net liability in de posits and Federal Reserve notes , 48.58 59.48 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT -NO, RICHMOND. 503 SCHEDULE 4.—Daily averages (by quarters) of bills discounted and bought and balances held as of Dec. 31, 1918, classified. Quarter ended Quarter ended Quarter ended Classification. Mar. 31. June 30. Sept. 30. Notes secured by Government war obligations: Members $6,143,691.44 $19,277,576.12 $32,279 427.04 Nonmembers indorsed by members 707,056.38 745,350.27 1.406,421.38 Others indorsed by members 4,840,746.62 4,113,880.12 5,234,842.38 Otherwises secured: Members by customers' notes 16,416.67 935,676.92 781,469.57 Others by agricultural products 370,534. 55 653,574.78 409,130.48 Merchandise (including commodity) 79,162.36 2,346. 85 870.00 Drafts with bill of lading 65,855.29 19,027.55 2,816. 75 Trade acceptances 1,255,325.66 1,784,434.55 1,451,984.92 Unsecured notes 17,494,190.32 19,097,871. 29 18,537,250.77 Total discounted. 30,972,979. 29 46,629,738.45 60,104,213.29 Bankers' acceptances: Foreign 6,415,829.95 3,675,294.78 2,785,204.35 Domestic 3,256,598. 56 1,993,493.04 1,790,953.29 Total bought. 9,672,428.51 5, 668,787.82 4,576,157.64 Total bills.... 40,645,407.80 52,298,526.27 64,680,370.93 RECAPITULATION. Secured by Government war obligations. 11,691,494.44 24,136,806. 51 38,920,690.80 Otherwise secured 531,968.87 1,610,626.10 1,194,286.80 Unsecured 18,749,515.98 20,882,305.84 19,989,235. 69 Total discounted 30,972,979.29 46,629, 738.45 60,104,213.29 Bankers' acceptances bought. 9,672,428.51 5,668,787.82 4,576,157. 64 Total bills. 40,645,407.80 52,298,526.27 64,680,370.93 Classification. Qua D rt e e c r . 3 e 1 n . ded o D v a e i r l y t h a e v e y r e a a g r e . o B f a D la e n c c . e . 3 h 1 e ,1 ld 9 1 a 8 s . Notes secured by Government war obligations: Members $50,614,664.12 $27,214,926.26 $58,008,847.72 Nonmembers indorsed by members 1,710,365.86 1,145,768.82 2,093,671.88 Others indorsed by members 9,225,515. 82 5,864,063. 68 12,331,812.15 Otherwise secured: Members by customers' notes 626,461.74 592,202.14 56,350.00 Others by agricultural products 869,427.17 576,577.31 1,651,194.10 Live stock 29,731.25 7,493.90 Merchandise (including commodity) 20,323.77 Drafts with bill of lading 6,448. 60 23,317.52 Trade acceptances - 2,373,749.20 1,718,713. 40 2,525,536.12 Unsecured notes 13,414,036.08 17,128,498.10 9,573,860. 08 Total discounted. 78,870,399. 84 54,291,884.90 86,241,272.65 Bankers' acceptances: Foreign 3,002,071.72 3,957,002.51 2,557,500.00 Domestic 2,789,928.74 2,454, 638.04 2,907,666.23 Total bought. 5,792,000.46 6,411,640. 55 5,465,166.23 Total bills.... 84,662,400.30 60,703,525.45 91,706,438.88 RECAPITULATION. Secured by Government war obligations. 61, 550,545.80 34,224,758. 76 72,434,331.75 Otherwise secured 1, 532,068- 76 1,219,914.64 1,707,544.10 Unsecured 15,787,785. 28 18,847,211. 50 12,099,396.80 Total discounted 78,870,399.84 54,291,884.90 86,241, 272. 65 Bankers' acceptances bought. 5,792,000.46 6,411, 640. 55 5,465,166.23 Total bills 4,662,400. 30 60,703, 525.45 91,706,438.88 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

504 ANNUAL, REPORT OF THE FEDERAL RESERVE BOARD. SCHEDULE 5.—Daily averages of bills discounted and bought (by quarters), classified as to States. First Second Third Fourth Total during State. quarter. quarter. quarter. quarter. year. Maryland $8,128,700 $11,050,253 $11,542,131 $12,076,305 $10,712,471 District of Columbia. 669,967 1,562,176 1,086,924 3,520,587 1,716,016 Virginia 18,571,489 22,252,966 25,732,978 35,045,587 25,448,644 West Virginia 820,955 1,661,505 1,985,293 1,910,804 1,598,696 North Carolina 6,828,444 8,666,000 12,176,065 15,232,293 10,752,699 South Carolina 4,843,556 7,524,694 12,199,511 17,177,750 10,475,000 Total 39,863,111 52,717,594 64,722,902 84,963,326 60,703,526 Number of banks accommodated quar terly. During Balance of bills State. year. held Dec. 31, 1918. . First. Second. Third. Fourth Maryland 65 $10,844,627.41 District of Columbia 9 3,960,155.15 Virginia 107 38,497,829.04 West Virginia 35 2,456,130.56 North Carolina 74 14,236,263.33 South Carolina 83 21,711,433.39 Total 182 287 299 373 91,706,438.88 NOTE.—During 1918, 52,648 pieces, aggregating $2,230,000,000 were handled, a daily average of 173 pieces, aggregating $12,900,000. SCHEDULE 6.—Discount rates current for the year 1918. Effective Effective Effective Effective Effective Classification. Jan. l.i Apr. 8. May 22. Oct. 19. Dec. 30. Member banks' collateral notes: Secured by customers' notes 4i 4* Secured by fourth Liberty bonds 4 Secured by other Liberty bonds and United States certificates 4i Other paper secured by United States securities: 15 days or less 4i 16 to 90 days 4i Secured by fourth Liberty bonds 4 Commercial paper: 15 days or less 4i 4J 16 to 90 days 4i Agricultural and live-stock paper: 15 days or less 42 16 to 90 days 41 91 days to 6 months 5 Com 1 m 5 o d d a i y t s y o p r a le p s e s r : (2) (2) (2) (2) 16 to 90 days (2) (2) (2) (2) Trade acceptances: 60 days or less 42 61 to 90 days 42 i Unchanged since Nov. 30,1917. 2 Classification discontinued. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 5—RICHMOND. 505 SCHEDULE 7.—Deposits—daily averages by months—1918 compared with 1917. Member banks. United States Government. 1918 1917 1918 1917 January... S42,714, 558.37 $26,023,6 16.67 $6,192 589. 75 $1,940,9 79. 43 February.. 43,792; 064.88 25,719,9 44.94 3,44i;8 80.51 1,460,9 30.46 March..'... 45,475, 617.61 26,255,2 81.88 3,465 995.36 4,086,8 50.04 April 44,093, 297.79 25,649,2 51.37 5,372!2 14.54 1,188,0 82.41 May 42,953, 272.62 25,600,1 11.52 5,210;3 66.00 3,468,8 57. 52 June 43,059, 352.57 28,290,3 47.84 10,303,5 45.35 7,979,1 10. 88 July 42,891, 498.85 33,950,8 83.34 8,211,5 46.69 10,375;5 97.34 August 45,205, 453.43 37,060,4 05.42 5,435,5 35. 68 5,148,7 18.32 September. 47,455, 743.00 36,922,9 69.42 6,730,8 80.92 3,310.4 45.18 October... 50,052, 999.82 40,217,9 88.13 8,313,3 78.99 3,466:7 50. 03 November. 51,336, 162.22 42,282,3 02. 89 7,704,0 00.02 11,646;8 35.94 December. 53,081, 357.77 43,673,0 86. 54 2,262,9 44.63 11,607,5 29.73 Year 46,022,279. 44 31,704,936.90 i, 249,427.51 5,524,462.85 SCHEDULE 8.—Deposits—daily averages by months for the year ended Dec. 31, 1918. [In thousands of dollars.] Per Deposi centage s ( p T U S a e t b u r t n n a c a e a r c r i i y t a l y a e t e s e s l s - d ) . d re e M b s p e e e o r r m s v s i ' e ts s . a U g T c S e D c n u r t n a o e i r u e y t t a u e r e e s n a s d l t . l d ia e N b p i e o l t i s t i y t . s l E F i t i n n a a e e o N b n s d t o e i d e e e l u t r r i s i v t n a t . y e l g R F d l t n i e e e i a a o N e p d s b n s t e o e e e d i t i r l r s s n v i a . i t e l re L h s e e e l g r d v a . l e - c o r l t e f e i o t P a s n i b l e e e t n e a i r s r e g l . v g i t a e e l R F a 3 f n g e e a c i 5 o x f s d a e t e i t i p e n e n e n r t r r e g s v s a r t e l against deposits. January... 22,364 42,715 6,193 43,168 53,134 96,302 54,405 56.31 73.98 February.. 14,824 43,792 3,442 39,002 52,707 91,709 47,572 51.87 64.35 March 20,236 45; 476 3,466 33,627 56,683 90,310 57,299 63.44 80.33 April 15,554 44,093 5,372 40,788 62, 822 103,610 53,311 51.45 62.13 May 33,165 42,953 5,210 40,185 67,291 107,476 57,141 53.17 64.01 June 36,852 43,059 10,304 42,013 68,331 110,344 55,953 50.71 60.36 July 28,185 42,892 8,212 41,313 74,401 115,714 58,097 50.21 58.65 August 33,104 45,205 5,436 43,783 85,881 129,664 67,133 51.77 60.32 September. 23,334 47,456 6,731 46,595 101,109 147,704 75,838 51.34 58.87 October... 33,121 50,053 8,313 47,453 117,436 164, 889 92,469 56.08 64.59 November. 44,303 51,336 7,704 46,119 131,111 177,230 86,798 48.97 53.89 December. 28,205 53,081 2,263 41,574 139,364 180,938 88,972 49.17 53.40 Year, 27,852 46,022 6,249 42,135 4,376 126,511 66,384 52.47 61.19 SCHEDULE 9.— Maryland. Balance, Jan 1, 1918 Additional allotments on in creased capital and surplus of members Total Addition to membership dur ing year Total Liquidations during year Balance, Dec. 31, 1918.. EECAPITTJLATION. National banks State banks and trust com panies Total, Dec. 31,1918 .sknaB 97 6 103 103 97 6 103 .serahS Capital District of Co lumbia. 19,234 111 19,345 1,272 20,617 20,617 17,558 3,059 20,617 .sknaB 15 15 15 14 1 15 .serahS stock analysis for year Virginia. 8,124 270 8,394 8,394 8,394 7,734 660 8,394 .sknaB 151 10 161 2 159 150 9 159 .serahS West Virginia. 21,500 891 22,391 817 23,208 116 23,092 21,347 1,745 23,092 .sknaB 103 3 106 106 103 3 106 .serahS 1918. North Carolina. 8,602 171 8,773 869 9,642 9,642 8,755 887 9,642 .sknaB 81 7 .serahS South Carolina. 7,841 371 8,212 2,081 8810,293 i 8810,293 83 8,305 5 1.988 88 10,293 .sknaB 83 11 94 94 81 13 94 .serahS Total. 7,978 376 8,354 852 9,206 9,206 8,106 1,100 9,206 .sknaB 530 37 567 2 565 528 37 565 .serahS 73,279 2,190 75,469 5,891 81,360 116 81,244 71,805 9,439 81,244 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

506 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. SCHEDULE 10.—Liberty loans. Tax certificates sold during 1918; anticipating taxes due June 25, 1918 $18,407,000.00 Certificates sold during 1918 anticipating third Liberty loan 75,829,500.00 Certificates sold during 1918 anticipating fourth Liberty loan l 117,983,500.00 Cash '. $27,535,500.00 Payment by credit in war loan deposit account 90,448,000.00 117,983,500.00 DISTRIBUTION OF SALES. Number Amount sub nu T m ot b a e l r. scr s i u b b i ng. ce P nt e a r g e. sc d r i i s b t e ri d c t i . n National banks 522 379 72.61 $73,289,000 State banks 1,252 365 29.15 18,582,500 Trust companies 197 59 29.95 18,473,000 Other banks (savings) 23 10 43.48 7,335,000 Total banks 1,994 813 40.77 117,679,500 Individuals, corporations, etc 11 304,000 Total 824 117,983,500 Tax certificates sold during 1918 anticipating taxes due in 1919 $16,663,000 Payment for same being made as follows: Cash $3,740,500 Payment by credit in war loan deposit account . 8,623,500 Payment made by certificates . 4,299,000 16,663,000 Certificates sold during 1918 anticipating fifth Liberty loan. 38,515,500 Payment for same being made as follows: Cash $7,817,000 Payment by credit in war loan deposit account . 30,698,500 38,515,500 DISTRIBUTION OF SALES. Number Total subscrib Percent Amount sub number. ing. age. scribed. National banks 522 220 42.14 $23,919,500 State banks 1,252 174 13.89 5,361,000 Trust companies 197 34 17.25 6,014,500 Other banks (savings). 23 8 34.78 3,165,000 Total banks 1,994 436 21.86 38,463,000 TpcHvidnals, corporations, p,to- . _ 16 52,500 Total 452 38,515,500 Third Liberty loan bonds allotted. Per cent| Per States. Po ti p o u n l . a r B es a o n u k r i c n e g s . Ap m po e r n t t i . o n su A b m sc o r u ib n e t d. s N o c f u r i m s b u e b b r e s r . u o l f s a u p t b i o o p n c s s a c u p r b i i p t a scribing.! tion. Maryland 1,412,030 $544,911,000 $38,259,000 $48,729,800 253,916 17.98 $34.51 District of Columbia 400,000 183,684,000 12,870,000 25,992,250 135,824 33.96 65.00 Virginia 2,148,050 424,796,000 29,809,000 44,048,750 173,787 20.51 West Virginia (Fifth dis trict) 1,239,000 224,738,000 15,782,000 23,461,500 125,344 11.12 18.94 North Carolina 2,400,314 265,672,000 18,655,000 24,582, 250 81,582 3.40 10. 24 South Carolina 1,595,000 209,594, 000 14,625,000 19,426,250 87,905 5.51 12.18 Total 9,194,394 1,853,395,000 130,000,000 186,240,800 858,358 9.34 20.26 Sundry subscriptions, Army and Navy 18,250 186,259, 050 Payment for same being made as follows: Cash $70,335,274. Credit in war loan- deposit account 93,016,365. Certificates of indebtedness.., . 22,907,000. Total payments 186, 258,640. Unpaid balances, account Army and Navy.. 410. • $186,259,050.00 i Details shown as to this issue were not requested as to previous issues and were therefore not kept as to those. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NTO. 5—RICHMOND. 507 Fourth Liberty loan bonds allotted. Quota. Subscription. Maryland $82,180,000.00 $86,316,450.00 District of Columbia 27,608,000.00 37,561,400.00 West Virginia 33,880,000.00 40,189,750.00 Virginia . 63,980,000.00 83,557,200.00 North Carolina 39,900,000.00 47,184,300.00 South Carolina 32,452,000.00 38,178,050.00 Miscellaneous railways, other Federal Reserve Banks for our account 19,698,050.00 Total.. 280,000. 00 $352,685,200.00 Payments made as follows: Cash 105,952,390.07 Credit in war loan deposit account. 154,938,474.93 Certificates of indebtedness. 31,464,000.00 292,354,865.00 Unpaid balances. 60,330,335.00 352,685,200.00 1 Payments not completed Dec. 31, and details by states, population, total number of subscribers, etc., not yet available. SCHEDULE 11.—Net sales of war savings stam,ps and thrift stamps during the year 1918. Number. Amount. "War savings stamps, at- $4.12 147, 539 $607, $4.13 121,636 502, 356.68 $4.14 139, 495 577, 509.30 $4.15 161,913 671, 938. 95 $4.16 99,688 414, 702.08 $4.17 532,192 2, 219,2 40.64 $4.18 372, 541 1,557,2 21.38 $4.19 206,726 866, 181. 94 $4.20 230, 706 968, 965. 20 $4.21 208, 801 879,0 52. 21 $4.22 160, 741 678, 327.02 $4. 23 119, 589 505, 861.47 Total 2, 501, 567 10,449,217.55 Thrift stamps at $0.25.. 1, 908, 038 477,009.50 Total 4, 409, 605 10,926,227.05 SCHEDULE 12.- -Federal Reserve agenVs record of Federal Reserve notes during the year 1918. Redemptions as advised Number of pieces. by United States Treasurer. Re Denominations. deemed Received for Issued and Balance Per Per H of e l D d e a c s . C f o ro m m p R Fe es d e e r r v a e l Gross. re F is e s d u e ed ra l t o h of e ld D e a c s . Pieces. ce o n f t ce o n f t 31, 1917. troller. Bank, Reserve 31, 1918. total total Rich Bank. pieces. values. mond. Fives 32,000 3,504,000 273,000 3,809,000 3,809,000 1,317,117 54.57 30.25 Tens 72,000 2, 756,000 509,500 3,337,500 3,237,500 ido,666 748, 282 31 34.37 8,000 2,080,000 213, 500 2,301, 500 2,265, 500 36,000 327, 878 13.58 30.12 Fifties 8,000 340,000 10,500 358, 500 326,500 32,000 17,770 .75 4.08 4,000 128,000 21,100 153,100 124,100 29,000 2,579 .10 1.18 Total 124,000 8, 808,000 1,027,600 9, 959, 600 9, 762,600 197,000 2, 413,626 100 100 Values $1,840,000 $116,480,000 $13,365,000 $131,685,000 $125,465,000 $6,220,000 $21,772,365 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

508 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. SCHEDULE 13.— Volume of bills discounted and purchased (by rates) at Baltimore branch from March 1 to December 31, 1918. Month. 3J per cent. 4 per cent. 4£ per cent. 4^ per cent. 4| per cent. 5 per cent. 5 c \ e n p t e . r Total. March $2,004,464 $8,321,098 $915,000 $808,491 $12,049,053 April 927,430 10,748,405 8,430,275 1,368,000 $4,925,740 26,399,850 May 12,283,350 6,242,303 909,000 2,123,138 $983,000 22,540,791 June 11,102,680 3,411,724 5,082,405 19,5%, 809 July 17,887,975 9,269 3,201,861 3,205,937 $1,300 24,306,342 August 14,722,758 39,752 5,183,749 807, 849 155 20,754,263 September 20,193,823 1,112,231 1,809, 650 23,115,704 October 951,453 45,2S9,976 6,829 1,376,260 2,140,438 49,764,956 November 3,963,497 32,578,191 1,070,496 240,133 37,852,317 December 7,223,274 19,456,680 311 642,362 85,425 27,408,052 Total 2,931,894 43,491,077 176,819,661 3,141,652 23,047,561 14,354,837 1,455 263,788,137 RECAPITULA TION. Discounted 2,931,894 43,491,077 175,508/161 1,100,383 7,603,721 14,354,837 1,455 244,991,528 Purchased 1,311,500 2,041,269 15,443,840 18.796,609 Total 2,931~894 43,491,077 176,819,661 3,141,652 23,047,561 14,354,837 1,455 263,788,137 NOTE.—The Baltimore branch was opened the 1st day of March, 1918. SCHEDULE 14.— Volume of clearing operations handled by the Baltimore branch, from Mar. 1 to Dec. 31, 1918. Items through transit depart ment. Payable. Number. Amount. Through Baltimore clearing house 651,944 $1,042,292,000 Elsewhere in fifth district 2,001,980 532,915,000 In other districts 447,756 490,817,000 Total 3,101,680 2,036,024,000 Average per day for the period of 244 business davs 12,712 8,467,311 SCHEDULE 15.—Salaries of officers and employees (including Baltimore branch, opened Mar. 1, 1918). Number. Salaries. 1916 1918 1916 1917 1918 Chairman and Federal Reserve agent. $10,000.00 $10, 000. 00 $10, 000.00 Governor 12,000.00 15,000.00 15, 000.00 Other officers 9,428.00 14,550.00 16, 358. 73 Banking department 13,956.00 22,880.00 76, 952.90 Bookkeeping department 5,520.00 4,980.00 9, 639. 71 Transit department 11,599.00 21,954.00 59, 484. 86 Federal Reserve agent's department.. 916.00 2,400.00 k 201. 69 Fiscal agency department 21,024.00 930. 26 General 8,819. 00 8,540. 00 810.20 36, Total. 63 109 254 72,238.00 121,328.00 286,378.35 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 5—RICHMOND. 509 SCHEDULE 16.—Clearing operations for the year 1918. Daily averages, 304 business days. Number Average Amount. of items. Number Amount. per item. items. Government cheeks 501,542 $130,092,000 1,650 $427,934 $259 Checks through Richmond clearing house. 512,005 1,694,998,300 1,684 5,575,652 3,311 Checks on other points in district No. 5... 9,806,417 3,604,398,300 32,258 11,856,573 368 Checks on points in other Federal Reserve districts 1,200,104 1,683,986,700 3,948 5,539,430 1,403 Total 12,020,068 7,113,475,300 39,540 23,399,589 591 NOTE.—A service charge of \\ cents per item, collected from members on items payable outside of Rich mond, was discontinued June 15, 1918. Disbursements on account of the transit department amounted to $134,294, which does not include cost of handling Government checks. This represents cost of 1.17 cents per item, or 1.92 cents per $1,000 of volume in values handled. 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. INTRODUCTION. The year 1918 has been the most momentous in the financial his tory of this district. Sudden demands occasioned by war conditions brought about rapid changes in financial and commercial activities. The financing of Government requirements and the war-savings campaigns brought the Federal Reserve Bank of Atlanta to the front in such a way that even that portion of the general public not actively engaged in business now fully realizes the worth of the Federal Reserve system. FINANCIAL RESULTS OF OPERATION. Schedule 1 shows comparative statements of the earnings and ex penses for 1917 and 1918. The gross earnings in 1918 increased 323 per cent over the earnings for 1917, while the expenses of operation increased 159 per cent. This includes the expenses of the Birming ham and Jacksonville branches since their establishment on August 1, 1918. The total expenses, which, in addition to the cost of opera tion, include the cost of Federal Reserve notes, furniture and equip ment, and depreciation of banking premises, increased 152 per cent, while the net earnings for 1918 were 474 per cent greater than in 1917. Dividends for 1918 were $182,472.68, as compared with $145,465.61 for 1917. The annual rate of net earnings on the paid-in capital stock was 11.08 per cent and 54.07 per cent for 1917 and 1918, re spectively. COMPARATIVE BALANCE SHEETS FOR DECEMBER 31, 1917-18. Comparative statements of the condition of the Federal Reserve Bank of Atlanta, as of December 31,1917-18, are shown in Schedule 2. The total resources have increased from $121,661,062.53 to $207,270,- 170.97. The earning assets have increased from $25,697,104.43 to $103,182,946.54, or an increase of 302 per cent. Member banks7 reserve deposits showed an increase of approximately $10,000,000 on December 31, 1918, as compared with December 31, 1917. The Federal Reserve note circulation has increased for the 511 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

512 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. year approximately $57,000,000. At the close of December 31, 1918, Federal Keserve bank note circulation amounted to $5,816,000. PROFIT AND LOSS. The profit-and-loss statement (Schedule 3) shows that the net profits, after deducting dividends of $182,472.68, amount to $1,470,000, of which $735,000 has been credited to the surplus ^ac count and a like amount to reserve franchise tax. GENERAL BUSINESS AND BANKING CONDITIONS. Except for the construction of a number of large shipbuilding plants, the year did not record any new industrial enterprises, although there has been a vast enlargement of operations in old industries, especially in the iron, steel, and coal fields. The most marked activity has been in the Birmingham manufacturing district and in the shipbuilding plants at New Orleans, Mobile, Jack sonville, Savannah, Brunswick, and practically every seaport town. In plants at these places there appears to be no lessening of activity since the signing of the armistice. War demands enlivened the lumber market, and with the opening of the sea traffic this trade, as well as that in naval stores, has taken on new life. Owing to the great yields and high prices for nearly all crops the producer finds himself in a strong financial condition. The cotton yields were larger than in 1917, and during the early picking season the prevalence of satisfactory prices enabled the disposal of such an amount of the crop as sufficed to liquidate pressing obligations, the producers, however, depending on their better financial condition and improved food situation to enable them to carry their surplus crop for better prices. The end of the year finds prices lower than in the early season and the cotton holding movement largely in force. Cotton buyers are experiencing some difficulty in purchasing the staple at the prevailing prices, which are deemed to be too close to the cost of production. The banks have shown a general willingness to assist the farmer in carrying his cotton, though the producer has not found it necessary to borrow in great volume. Generally speaking, almost every line of business was handicapped during the year by a shortage of labor. The wages paid and the rules practiced with reference to compensation and overtime have somewhat demoralized labor for normal conditions. With the increasing progress in army demobilization there will be some relief, but with little or no immigration expected for some years, labor con ditions are viewed as extremely uncertain. Little or no engineering or construction work was carried on after Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTEICT NO. 6 ATLANTA. 513 There has been great diversification of farming operations, and practically all industrial plants show increased capacity and output and are in better position to supply the foreign trade. Shipping has begun to open up and there will be a gradual movement of raw mate rials, especially cotton, with larger demand and better prices. Collections were reported unusually good during almost the entire year, with monthly increases in bank clearings, railroad and postoffice receipts. MONEY MARKET. Interest rates for loans prevailing in financial centers in this district have increased somewhat. Rates for several years past have ranged from 5 to 6 per cent, but during the latter half of 1918 were advanced to 6| and 7 per cent. These rates have advanced notwithstanding the increase in bank deposits. DISCOUNT OPERATIONS^ (A) REDISCOUNTS—COMMERCIAL PAPER. Discount operations of this bank have been very active during the past 12 months. This was due largely to the fact that as each of the Liberty loans was placed on the market member banks accom modated their customers and in turn used the discount privileges of the Federal Reserve Bank. In November, 1917, there were 122 banks availing themselves of the privilege of rediscounting with us. The volume of rediscounts was then $12,343,823.69, whereas on November 23, 1918, 260 banks were availing themselves of this privilege, and the total amount of rediscounts on that date was $74,979,123.10, or a little over six times as much as in November, 1917. This ratio has prevailed throughout the year. At the same time the acceptances purchased by us from our member banks in November, 1917, amounted to $4,307,783.42, whereas on November 23, 1918, they were $13,170,- 936.35, or about three times as much as in 1917. The discounting banks are distributed over the entire six States, Tennessee and Mississippi possibly discounting smaller amounts pro portionately to the number of banks. There are 426 members in the district, and of these 260 were "using the discount privilege on November 23. (B) REDISCOUNTS—LIBERTY LOAN. As to the classification of the discount holdings of this bank, out of $74,979,123.10 there were $36,844,736.92 secured by Liberty loan bonds and United States Treasury certificates of indebtedness; and, while all of this possibly could not be charged to Government financing, yet it is believed that several member banks have used their Government securities for the privilege of rediscounting largely 100823°—10 33 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

514 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. to take care of needs of their customers, using their Government securities because of the preferential rate given to that class of discounts, our rate to member banks presenting Government bonds and certificates as collateral to member bank notes being 4 per cent per annum, whereas our commercial rates ranged from 4J to 4f per cent. TRADE ACCEPTANCES. Trade acceptances, we believe, are being used by business interests in this district to a greater extent than rediscounts of this class of paper with us show. We believe that quite a number of the firms are using their own paper with the member banks for discount and retaining the trade acceptances in their own portfolios, sending them out for collection through the member banks. But the movement has been started for the use of trade acceptances, and this is being done to some extent in sections where oil mills are buying from, the farmers the products to be crushed into the oil products. We have quite a number in items, but a small amount in dollars and cents. We have under discount trade acceptances amounting to $2,745,900.44. ACCEPTANCES. GROWTH OF OPEN MARKET TOR ACCEPTANCES. There is practically no open market for acceptances, and the proper development of bankers' acceptances is rather difficult in the Sixth Federal Reserve District; that is, for bank acceptances to be handled by the drawer of the draft and sold in the open market. The reason for this state of affairs is the high rate prevailing for commercial paper originating outside the district and offered by brokers through our member banks at rates around 6 per cent. We are fully aware of the fact that the ideal way of handling bankers' acceptances is to have the member banks accept the paper, then throwing it upon the open market to be sold with the possibility that it will find its way into the Federal Reserve Banks. It would then be a two-name paper. Whenever business conditions get back to normal, commercial paper will not bear so high a rate and there will be a better opportunity for the marketing of bankers' acceptances in this district. This will probably take some time and will not be accomplished until the readjustment of financial conditions arising out of war transactions has been completed. POLICY REGARDING ACCEPTANCE PURCHASES. The policy adopted for the present is to purchase from member banks their acceptances for the account and credit of their customer with that member bank, and should such acceptances be for less than 10 per cent of the capital and surplus of the bank to mark the Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 6—ATLANTA. 515 acceptances "documents detached" and thus purchase the paper. But where the acceptances aggregate more than 10 per cent of the capital and surplus of a member bank it is our policy to have the documents, such as warehouse receipts, order-notify, bills of lading, port or dock receipts, and specific insurance policies, accompany the acceptances which are discounted with the "documents attached." RESERVE POSITION. The extent to which the Federal Reserve Bank has aided member banks during the past year in financing the sale of Liberty loan bonds has had a very marked effect on our reserves. The banks of this country could not unaided finance the subscrip tions of their customers and the public generally to an extent which would enable all the people to participate as subscribers. For that reason a large part of the resources of the Federal Reserve Banks was made available to member banks through the privilege of rediscounting customers' notes and member banks' collateral notes secured by Liberty loan bonds at rates of discount corresponding approximately to the rate of interest borne by the bonds. Federal Reserve Banks accordingly carried throughout the entire year a large amount of bond-secured discounts and rediscounts, the amount varying with the periods of the Liberty loans, the largest amounts being carried for a short period subsequent to the closing of each campaign. Federal Reserve Banks also aided member banks in financing their subscriptions to Treasury certificates of indebtedness issued in antici pation of each loan. The method of extending this accommodation was the same as that used in financing the Liberty loans, the Treasury certificates being used as collateral to notes. The effect of this financing was very largely to increase our dis counts with a corresponding decrease in our reserves. The decrease in our reserves during the year was only partly due, however, to financing the issues of bonds and certificates. Our rediscounts of commercial, industrial, and agricultural paper increased very materially, as did also our issue of Federal Reserve notes. These were two of the factors largely responsible for reduction of the per centage of our reserve. Our reserve percentages on December 31, 1917, were as follows: Per cent. Gold reserve against Federal Reserve notes in circulation 93 Gold and lawful money reserve against net deposits 67 Total reserve against net deposits and note liability 84 Our reserve percentages at the close of 1918 were as follows: Gold reserve against Federal Reserve notes in circulation 41 Gold and lawful money reserve against net deposits 39 Total reserves against net deposits and note liability 40 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

516 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. MOVEMENT OF MEMBERS. NATIONAL AND STATE BANKS. The feeling of State banks has shown considerable change during the past 12 months, and these institutions now have a clearer under standing of the workings and benefits of the Federal Reserve system. During 1918 the following 32 State banks joined the Federal Reserve Bank of Atlanta, with combined capital and surplus aggregating $9,735,980, viz: Name of bank. Location. Capital. Surplus. Citizens Bank & Trust Co Athens, Ala $30,000 $18,000 Birmingham Trust & Savings Co Birmingham, Ala... 500,000 715,060 Cherokee County Bank Center, Ala * 25,000 15,00) Merchants Bank Mobile, Ala 200,000 275,000 Peoples Bank do 200, 000 363,310 American Bank Union Springs, Ala. 50,000 12,900 Leesburg State Bank Leesburg, Fla 30,000 13,100 Southern Bank & Trust Co Miami, Fla 100,000 2,030 Hillsboro State Bank Plant City, Fla 50,000 75,000 Exchange Bank Tallahassee, Fla 50,000 3,000 Union State Bank Winter Park, Fla... 30,000 2,000 Georgia Savings Bank & Trust Co Atlanta, Ga 200,000 141,280 Bank of Camilla Camilla, Ga 50,000 53, 700 Northeastern Banking Co Commerce, Ga 100,000 41,470 Hartwell Bank Hartwell, Ga 60,000 34,000 Jackson Banking Co Jackson, Ga 50,000 28, 710 Bank of Louisville Louisville, Ga 25,000 36,000 Citizens Bank Metter, Ga : 30,000 20,000 Peoples Bank Sardis, Ga 25,000 9,600 American Bank & Trust Co Savannah, Ga 200,000 19,210 Farmers Bank Winder, Ga 50,000 3,000 Pittard Banking Co Winterville, Ga 25, 000 14,290 Commercial Bank & Trust Co LaureljMiss 100,000 33,600 Union Bank & Trust Co Baton Rouge, La 150,000 5,500 American Bank & Trust Co New Orleans, La 200, 000 20,000 Citizens Bank & Trust Co do 400, 000 240,000 City Bank & Trust Co do 200, 000 170,140 Commercial Trust & Savings Bank do ,250,000 961,440 Liberty Bank & Trust Co do 200,000 12,000 Maine Bank & Trust Co do 400,000 132,000 Pointe Coupee Trust & Savings Bank. New Roads, La 60, 000 330 Chattanooga Savings Bank Chattanooga, Tenn.. 750,000 323,430 Total. 5,865,000 | 3,870,980 The following is of interest as to the results to date with reference to State bank members: State banks joining the Federal Reserve Bank of Atlanta during 1918.. 32 Total State bank members of the Federal Reserve Bank of Atlanta 54 Percentage of total eligible banks in the Sixth District members of the Federal Reserve Bank of Atlanta 7.2 Total capital of State bank members, sixth district $15, 790, 000 Estimated percentage of total capital of eligible banks in district 28. 7 Capital and surplus of State bank members $25, 932, 000 Estimated percentage of total of capital and surplus of eligible banks in district 23. 6 Total resources of State bank members $238, 500, 000 Estimated percentage of total resources of all eligible banks in sixth district 53. 5 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 6—ATLANTA. 517 During the year the capital stock of the Federal Reserve Bank of Atlanta was increased by 7,007 shares, with a decrease of 251 shares, including liquidations and surrender of stock on account of reduction of capital and surplus, showing a net increase of 6,756 shares. Since the establishment of the Federal Reserve Bank of Atlanta no State bank joining the system has withdrawn its membership, this being substantial proof of general satisfaction with the advantages accruing to members of the system. There were no bank failures among the members of the Federal Reserve Bank of Atlanta during the past year, and only five national banks, representing 161 shares, were liquidated, their capital and surplus aggregating $268,334. In addition to the 32 State banks which became members, 7 new national banks were granted charters, with paid-in capital totaling $343,334, representing 206 shares of stock in the Federal Reserve System. As of December 31, 1918, there are 372 national and 54 State bank members of the Federal Reserve Bank of Atlanta. The generally unsettled condition of affairs and the large amount of extra work in connection with war activities has somewhat handicapped the State bank member campaign in this district, but with the resumption of more normal conditions a more intensive and energetic campaign during 1919 will be possible. RELATIONS WITH NATIONAL BANK MEMBERS. DISCOUNT OPERATIONS. As previously reported under the caption "Reserve position," dis count operations increased very materially during the year. The greater part of the increase is directly attributable to war financing. Member banks had to obtain aid in order to finance the Liberty loan bond and certificate issues. This business was augmented by the financial aid extended by the banks to war industries. During the latter months of the year the stagnation of the cotton market called for extension of aid to the cotton farmer and the country merchant pending the development of a free movement of cotton. The increase in our discount operations was about equally divided, proportionate to their number, between national and State bank members. The total amount of paper under discount and rediscount for State and national bank members, and of paper bought in open market December 31, 1918, was as follows: Collateral notes of member banks $47, 626, 800. 00 Rediscounts 36, 408, 710. 93 Bills bought 12, 514, 685. 61 Total 96, 550,196. 54 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

518 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. FIDUCIARY POWERS. The fiduciary powers made available to national banks by the Federal Reserve Act as originally drawn and subsequently amended have introduced an entirely new feature into the operations of those national banks which have acquired this privilege. In this district the national banks have been very deliberate in acquiring this new power, principally for the reason, probably, that banking and financial conditions have been abnormal from the be ginning of the operation of the Federal Reserve Act, so that the majority of banks have deemed it prudent not to venture into new fields of activity. Fiduciary powers have been granted to and are being more or less actively exercised by national banks in the States of this district as follows: Alabama, 11; Florida, 7; Georgia, 6; Louisiana, 2; Missis sippi, 4; Tennessee, 7. RELATIONS WITH STATE BANKS AND TRUST COMPANIES. DISCOUNT OPERATIONS. The 54 State banks now members of the Federal Reserve System in this district have had an opportunity to test the practical value of membership and are distinctly satisfied with the result. In proportion to their number they have as liberally availed them selves of the privileges of membership as have the national banks. This is evidenced by the volume of discounts offered by them. RESERVES. Though the matter of carrying their reserve with the Federal Reserve Bank called for readjustment of State bank members' rela tions with their former reserve agents, they have without exception rapidly accommodated themselves to this new relation without difficulty or inconvenience. They find that membership in the sys tem has enabled them to release a large portion of the cash reserve that they felt it incumbent to carry in their own vaults previous to becoming members and that their relatively small cash reserve involves no hazard because of the fact that the discounted paper in their portfolios eligible for rediscount with the Federal Reserve Bank is in reality a secondary reserve which they may utilize whenever they deem it necessary or desirable. By materially reducing their reserves they have increased their loaning power and are able better and more satisfactorily to serve the business interests of their respective communities. This means more business and more earning power for them and their stockholders and they have not been slow to avail themselves of the full advantage of doing more business and doing it with perfect safety. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 6—ATLANTA. 519 EXAMINATIONS. All State banks and trust companies applying for membership dur ing 1918 were examined, except newly organized banks. These were admitted upon a certificate that the laws had been complied with and that they were open for business. Examinations have been made of all State bank members by the departments of banking in the various States of the Sixth Federal Reserve District and copies of examination reports have been furnished the Federal Reserve Bank of Atlanta. The superintendents of banks of the several States in the Sixth District have shown their willingness to cooperate with the Federal Reserve Bank of Atlanta in every way possible, and while their forms for reporting examinations are not in every instance in accord ance with the form required by the Federal Reserve Board, they have unhesitatingly agreed to furnish the additional information. In some instances, at the request of the superintendents of banks, the Federal Reserve examiner has assisted in the examinations. There have been no withdrawals of State bank members and in most instances all of them have availed themselves of the benefits to be derived from membership in the Federal Reserve system. FISCAL AGENCY OPERATIONS. The fiscal agent's department of the Federal Reserve Bank of Atlanta, for the year ending December 31, 1918, shows a tremendous increase in operations. Certificates of indebtedness were sold during the year 1918 in anticipation of the third and fourth Liberty loans. These offerings were made in advance of the Liberty loans at intervals of about two weeks. The Treasury Department undertook to outline the amount necessary for each bank to subscribe, in order to attain the required results that sufficient funds might be procured to meet the ever-increasing current expenses of the department. Six offerings of certificates prior to the third Liberty loan met with fair response from the banks in this district, and an analysis of the subscriptions by national banks, State banks, and trust companies is given in Sched ule 4, the national banks attaining the largest per cent of subscriptions in proportion to the number of banks being 87.36 per cent, while the State banks purchased 52.43 per cent, and the trust companies 70 per cent. Member and nonmember banks were able to scale their loans on nonessentials and to divert their funds to the purchase of Treasury certificates. In the main certificates of indebtedness were purchased by banks and paid for by credit, which of course was of some material help to the banks. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

520 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. DEPOSIT OF TREASURY FUNDS WITH BANKS AND THEIR WITHDRAWAL. Treasury funds arising out of the sale of Liberty loan bonds and certificates of indebtedness were redeposited in banks. The process of qualifying as depositary bank was simple, and could be carried out by almost any bank in this district if it so desired. In the main such funds redeposited with banks were secured by Government obliga tions. Withdrawals were promptly made by the Treasury Depart ment. Little difficulty was experienced by the banks in responding to the calls. In most cases the entire amount was withdrawn within probably two weeks from the date of the deposit. The depositary banks thus obtained the securities so purchased, which of course could be hypothecated, if they cared to do so, with their correspondent banks, or with the Federal Reserve Bank, if they were members of the system. On the other hand, a good many banks when finding that the funds remained with them so short a time chose rather to pay for certificates of indebtedness and bonds either in cash or on the instalment basis. Funds redeposited with depositary banks in 1918. Amount of redeposits with depositary banks representing payments on account of subscriptions to Liberty loan bonds made by credit in the war loan deposit accounts, as follows: Third Liberty loan $77, 572, 776. 28 Fourth Liberty loan. 109,257,055.16 Total 186, 829, 831. 44 Amount of redeposits with depositary banks representing payments on account of subscriptions to Treasury certificates of indebted ness made by credit in the special deposit account, as follows: Treasury certificates (third loan) 53, 330, 850. 00 Treasury certificates (fourth loan) 95, 671, 500. 00 Treasury certificates (fifth loan) 16, 089, 000. 00 Total , 165, 091, 350. 00 Treasury certificates, tax series, 1918 13, 938, 500. 00 These funds remained with the depositary banks for periods ranging from 10 to 30 days and were withdrawn gradually by direction of the Secretary of the Treasury. THE FLOTATION OF LIBERTY LOANS. The flotation of the Liberty loans met with large success in this district. Many of the best and most conservative bankers felt fearful of the result of the second loan, but when the time arrived to offer it a largely increased number of subscribers was found. The third Liberty loan was taken by a number of purchasers, probably 200 per cent larger than the second ioan, and the fourth loan showed a corresponding increase. An analysis is given in Schedules 7 and 8 of the taking of Liberty loans in this district by State banks, national banks, and trust com- Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 6—ATLANTA. 521 panies, and also by States, giving their 1910 population; also by cities with populations in excess of 25,000 inhabitants; also a classi fication of subscriptions as outlined by the Treasury Department. WORK IN CONNECTION WITH THE SALE OF WAR-SAVINGS CERTIFICATES. The sale of war-savings and thrift stamps has been the occasion of a campaign of education. In the future stamps will probably be purchased as a mode of general saving. An analysis of war-savings stamps sales for the year 1918 is here given. Sale of war-savings certificate stamps and thrift stamps for the year 1918. Alabama .. $718, 925.10 Florida................ 697,414.52 Georgia 2, 310, 740. 45 Tennessee 3, 362,054. 39 Louisiana 4,170, 315. 66 Mississippi 2,131, 379. 57 Total 13, 390, 829. 69 WAR FINANCE CORPORATION. Necessary machinery was provided for the handling of business inci dent to the War Finance Corporation, and a considerable amount of correspondence and literature found its way from the Federal Re serve Bank to the banks of the district. The need for such loans was not, however, as great in the sixth district as was anticipated, and only one loan was made to a bank during the year. This was promptly liquidated at maturity. CAPITAL ISSUES COMMITTEE. At the invitation of the Federal Reserve Board, the district com mittee on capital issues for the sixth district was organized as follows: Messrs. M. B. Wellborn, chairman; Joseph M. Slattery, secretary; Joseph A. McCord, Hollins N. Randolph, Roby Robinson, Frank Hawkins, all of Atlanta; with an auxiliary committee composed of Messrs. Otto Marx, Birmingham, Ala.; Edward W. Lane, Jackson ville, Fla.; James E. Caldwell, Nashville, Tenn.; W. H. Hassinger, Birmingham, Ala.; F. E. Gunter, New Orleans, La.; A. M. Baldwin, Montgomery, Ala.; Harry Hall, Mobile, Ala.; W. F. McCauley, Savannah, Ga.; L. M. Pool, New Orleans, La.; T. R. Preston, Chat tanooga, Tenn.; T. C. Taliaferro, Tampa, Fla.; and H. V. Watkins, Jackson, Miss. Publicity was given to the work and the committee obtained satisfactory cooperation. Very few instances occurred where issues Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

522 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. were put upon the market without the consent of the Capital Issues Committee and even these are said to have been due to ignorance. Hundreds of cases involving amounts ranging from $1,000 to $25,000,000 were considered by the district committee, and through general correspondence and newspaper work the organization was successful in discouraging a great many anticipated issues. The work consumed a considerable amount of the committeemen's time. Meetings were held almost daily and involved a very large amount of correspondence. As of December 31, 1918, the District Capital Issues Committee, at the request of the Capital Issues Committee at Washington, temporarily suspended supervision of the issue and sale of stocks and bonds, to resume operations at a later date, should it be deemed advisable by the Government authorities. FEDERAL RESERVE NOTES The issue of Federal Reserve notes has been an important feature of the year's operations, due in a large measure to the increased pay rolls and high cost of commodities. The statement of December 31, 1918, shows $196,240,000 " Federal Reserve notes received from the Comptroller of the Currency/' with "Federal Reserve notes out standing" in amount, $123,620,285, as compared with $66,867,420 "Federal Reserve notes outstanding," on December 31, 1917, or an increase of $56,752,865. During the year 1918, the Federal Reserve Bank of Atlanta re ceived from other Federal Reserve Banks $21,107,515 of its own Federal Reserve notes and returned to other Federal Reserve banks $20,438,925 of their notes, showing only a slight difference of $668,- 590 in the interdistrict movement of notes. This movement of notes was practically the same in amounts exchanged to and from Atlanta, with the exception of shipments to New York of its notes, being $9,131,200, and our notes returned by New York in amount, $6,068,945; and shipments from Cleveland of $297,900, compared with Federal Reserve notes returned to Cleveland in amount, $2,003,865. FEDERAL RESERVE BANK NOTES. The power of issuing bond-secured currency is conferred upon the Federal Reserve Banks by the act as originally drawn, but it was not found necessary or desirable to resort to any large exercise of this power until this year. Accordingly, Federal Reserve bank notes were not issued by the majority of the Federal Reserve Banks until June. On the 10th day of that month the first bank notes of the Atlanta bank were issued. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 6 ATLANTA. 523 The issues have been practically continuous and more or less equally distributed over the past six months. There were outstand ing on December 31, 1918, $6,085,600. POSITION OF COMMERCIAL BANKS AS A RESULT OF WAR FINANCING. The volume of war financing handled by banks necessarily caused general credit expansion, with the logical and unavoidable result that banks are showing in their statements of condition more re discounts and bills payable than usual. Credit has not, however, been expanded to an alarming extent and there should be no cause for apprehension on this score. It is expected that a healthy and necessary contraction of credit will soon be in evidence. Increase of bank deposits has about kept pace with credit expansion and as a whole the banks of this district are in a very strong position. EFFECT ON COMMERCIAL PAPER OF THE DISTRICT. Commercial paper originating in this district does not appear to have been materially affected by war financing, but it has been affected by war conditions which operated to prevent normal market ing of some crops and an abnormal demand for other crops. Food production of the district has been large and has been marketed at high prices. This condition called for more liberal financing of the producer and that, together with increased cost of production, has manifested itself in an increased volume of agricultural and com mercial paper. Paper which directly owes its origin to war financing has found a rather ready market in this district and there is a much larger volume of short-term notes issued by northern commercial industries in this district than ever before. RELATION TO, AND EFFECT ON GENERAL BUSINESS. Business generally has been abnormally stimulated by war financ ing and by war conditions. Though difficulty has at times been experienced in obtaining products of trade and commerce in sufficient quantity to satisfy the demand, the total volume of business has been greater than for any previous year in the history of the south east, and the total volume of general business of the banks has been greater than ever before. It has been a year of intense activity for the banks and also a year of very profitable business for them as a whole. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

524 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. POLICY TO BE PURSUED IN RESTORING LIQUIDITY OF BANKS. It would be very difficult to say at what time we may expect mem ber banks to clear up their war paper. This is due largely to the fact that the main products in. this section, such as cotton, cotton seed, peanuts, rosin, and turpentine, of this year's crop, have not yet been sold. The decrease in the price of cotton in the fall created a disposi tion in the minds of the producers to hold their products for a better price; and, with increased prices, liquidation will set in from that source. This, in turn, will restore the liquidity of the banks and will enable them to settle their loans secured by Liberty bonds and United States Treasury certificates. POLICY OF FEDERAL RESERVE BANK TOWARD MEMBER BANKS. The policy of the Federal Reserve Bank of this district will be to aid these member banks by carrying their discounts for them until such time as this liquidation will materially set in, which it is ex pected will be during the months of January, February, and the early part of March. We are extending to member banks the facilities of this bank in every way. OPERATION OF FEDERAL RESERVE BANK BRANCHES. In addition to the branch already in operation at New Orleans, a branch of the Federal Reserve Bank of Atlanta was established at Birmingham, Ala., on August 1, 1918. Mr. A. E. Walker, formerly State bank superintendent of Alabama, was elected manager, and Mr. J. B. Cobbs was appointed assistant Federal Reserve agent. The entire clerical force consists of 15 employees, including the officers. The following members compose the board of directors of the branch: Messrs. W. H. Kettig, chairman; Oscar Wells, T. O. Smith, W. W. Crawford and John H. Frye, all of Birmingham. As of the same date a branch was established at Jacksonville, Fla. Mr. Geo. R. DeSaussure, prominent for many years in banking circles in that city, was elected manager, and Geo. R. Martin was appointed assistant Federal Reserve agent. The entire clerical force consists of 16 employees, including officers. The branch board of directors is composed of Messrs. John C. Cooper, chairman; Edward W. Lane, B. H. Barnett, Giles L. Wilson, Fulton Saussy, all of Jacksonville. These branches are operated under the limited form of by-laws in force at Pittsburgh and Cincinnati, providing for a daily settlement plan with the parent bank. All accounts with member banks in the zone covered by the branches are kept by the parent bank, the branches reporting to it by private wire daily both their immediate and deferred entries and the parent bank carrying the "float." The plan in operation has proven generally satisfactory to both the member banks in the branch zone and to the parent bank. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 6—ATLANTA. 525 INTERNAL ORGANIZATION. The war called 23 employees to the colors; and, with the numerous Army camps in this district and a great volume of Government work under way, many employees were attracted by the high wages paid, and competent clerical help has been exceedingly scarce, this scarcity handicapping operations seriously. Since the signing of the armistice old clerks have been returning to their former positions and clerical service is rapidly improving. During the year, Mr. Edgar B. Stern resigned as a class B director of the Federal Reserve Bank of Atlanta to accept a commission as captain in the United States Army. Mr. James E. Zunts, of New Orleans, La., was elected to fill the unexpired term caused by Mr. Stern's resignation. Mr. J. A. McCrary, of Decatur, Ga., was re elected a class B director for the three-year term ending December 31, 1921. Mr. J. B. Pike, cashier, was promoted to the position of deputy governor on November 8 and resigned on December 10. Mr. M. W. Bell, assistant cashier, was elected cashier, the position of deputy governor being left unfilled. Mr. J. L. Campbell, formerly assistant manager of the New Orleans branch, was transferred to the parent bank as assistant cashier, in charge of the department of discounts and credits. CLEARINGS. Transit operations have shown a steady increase during 1918, especially since June, when the service charge for handling items was discontinued. The increase for December over January, 1918, is 111 per cent, which, if the direct sendings were considered, would be about 115 per cent. The cost of handling items for the year has been $0.0097 per item and $0.0228 per $1,000. The report submitted herewith shows an increase in the number of items handled over 1917 of 95.8 per cent, and in amount of money 94 per cent. In comparing these figures with those reported for 1917 it should be borne in mind that 10 of our largest member banks have been sending direct to other Federal Reserve Banks such items as were payable in other Federal Reserve districts, and the number of items and amounts handled in this manner are not shown in the report. This method has been in operation several months. The average daily sending of these banks to other Federal Reserve Banks is approximately 2,000 items, amounting to approximately $1,000,000. During the year 35 banks were added to our par list. Thirty banks were withdrawn, leaving a net gain of five banks. We now have in the Sixth District 635 banks remitting at par. A statement of transit operations is shown in Schedule 10. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

526 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. COLLECTIONS. The collection department has increased the volume of items handled to a very considerable extent during the year 1918, not withstanding the fact that we have no banks remitting collections at par. We handle all items forwarded us as "Collection items," either by Federal Reserve Banks or member banks for their accounts, including member banks of other districts. The greater volume of items handled consists of notes, drafts, and checks, and only a small proportion has consisted of bill-of-lading drafts. Under the ruling of the Federal Reserve Board sight drafts customarily used in settling cotton transactions are classed as ineligible and member banks have arrangements whereby they secure immediate credit for this kind of draft, which explains the large volume of drafts of this character handled through sources other than the Federal Reserve Bank. While very few "dunning" drafts have been handled through our collection department, it is thought that the elimination of the service charge may operate as an incentive toward an increase in this character of items. During the year 1918 the collection department handled 5,208 items, amounting to $10,868,815.30. GOLD SETTLEMENT FUND. The change on July 1 from a weekly to a daily settlement with other Federal Reserve Banks through the gold settlement fund has resulted in making payment daily for all available credits to another Federal Reserve Bank. Under the weekly plan of settlement a "due to" or "due from" balance existed between Federal Reserve Banks which was not paid until the regular settlement day. At times these balances were considerable and when such a condition existed the reserve of the Federal Reserve Bank having a large "due from" balance was affected until settlement day. Under the daily settlement plan, by receiving credit daily in the gold fund, the "due from" collected balance is eliminated and each Federal Reserve Bank receives full benefit of all available funds in its reserve. The daily settlement plan is regarded as a great improvement over the weekly plan, especially in view of the increased volume of transactions between Federal Reserve Banks. BANKING QUARTERS—NEW BUILDING. On October 1 the Federal Reserve Bank of Atlanta moved into its permanent home on Marietta Street. The building is a two-story structure, with commodious basement, being of reinforced concrete, with granite exterior, fireproof, and of thoroughly modern construe- Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 6—ATLANTA. 527 tion. While the new quarters are adequate for the bank proper at present, additional space will have to be provided in the near future, as the business of the institution is rapidly increasing and it is now necessary to operate the fiscal agent department in a near-by building. Plans for the new building were drawn and excavation began in the late spring of 1917, and the growth of the institution has been more rapid than was anticipated. The building cost approximately $150,000 and the vaults $33,000. EXHIBIT A.—Movement of principal earning assets of the Federal Reserve Bank of Atlanta during the calendar year 191'8. [In thousands of dollars.; i. e., 000 omitted.] Dis counted j paper se Other Bills Total S c t U u a r t n e e i d s t e b w d y a r c p o a d u p i n s e t e r. d (1+2) m i b n o a u o rk g p e h e t n t . b c i o l a l u s n n d t d e i d s P ( e 1 r + c 5 e ) n . t obliga- I bought. tions. 1 Jan 4 2,070 2,617 14,687 6,373 21,060 9.8 Jan. 11 1,736 13,566 15,302 2,424 17,726 9.8 Jan. 18.... 3,835 8,860 12,695 6,750 19,445 19.7 Jan. 25.... 3,753 7,595 11,348 6,824 18,172 20.7 Feb.1.... 1,987 7,171 9,158 7,076 16,234 12.2 Feb. 8.... 1,837 8,704 10,541 6,634 17,175 10,7 Feb.15... 1,974 8,346 10,320 6,620 16,940 1L7 Feb.21... 1,928 7,534 9,462 6,719 16,181 11.9 Mar. 1.... 1,781 7,768 9,549 6,512 16,061 11.1 Mar. 8.... 1,827 9,113 10,940 7,104 18,044 10.1 Mar. 15... 1,8^0 7,901 9,711 7,188 16,899 10.7 Mar. 22... 2,891 9,228 12,119 7,470 19,589 14.8 Mar. 28-29 2,392 11,315 13,707 7,417 21,124 11.3 Apr. 5 4,562 8,391 12,953 10,275 23,228 19.6 Apr. 12... 4,368 9,136 13,504 9,756 23,260 18.8 Apr. 19... 9,439 10,845 20,284 9,709 29,993 31.5 Apr. 26... 10,722 9,684 20,406 8,997 29,403 36.5 May 3 12,685 11,509 24,194 8,027 32,221 39.4 May 10... 11,946 12,127 24,073 6,885 30,958 38.6 May 17 ... 10,168 11,135 21,303 5,567 26,870 37.8 May 24... 11,890 11,924 23,814 4,569 28,383 41.9 May 31... 12,511 12,328 24,839 3,840 28,679 43.6 June 7 12,437 13,486 25,923 4,380 30,303 41.0 June 14... 15,724 16,900 32,624 4,125 36,749 42.8 June 21... 11,336 14,709 26,045 4,474 30,519 37.1 June 28... 12,058 16,187 28,245 4,131 32,376 37.2 July 5.... 14,442 18,057 32,499 3,931 36,430 39.6 July 12... 11,733 19,620 31,353 4,020 35,373 33.2 July 19... 13,220 20,529 33,749 3,642 37,391 35.4 July 26... 16,102 22,160 38,262 3,563 41,825 38.5 Aug. 2.... 20,333 21,820 42,153 3,263 45,416 44.8 Aug. 9.... 24,118 21,338 45,456 3,489 48,945 49.3 Aug. 16... 22,998 20,557 43,555 3,361 46,916 49.0 Aug. 23... 23,841 23.124 46,965 3,122 50,087 47.6 Aug. 30... 26,783 23,073 49,856 3,557 53,413 50.1 Sept. 6.... 31,314 23,728 55,042 3,436 58,478 53.5 Sept. 13... 36,024 25,807 61,831 3,702 65,533 55.0 Sept. 20... 39,650 28.125 67,775 4,622 72,397 54.8 Sept. 27... 45,133 31,051 76,184 6,104 82,288 54.8 Oct. 4 49,522 30,104 79,626 7,648 87,274 56.7 Oct. 10... 47,644 29,579 77,223 8,749 85,972 55.4 Oct. 18... 52,365 30,188 82,553 9,874 92,427 56.7 Oct. 25... 45,531 31,178 76,709 10,533 87,242 52.2 Nov. 1.... 53,964 32,832 86,796 12,331 99,127 54.4 Nov. 8.... 48,894 36,556 85,450 12,560 98,010 49.9 Nov. 15... 45,508 36,538 82,046 13,039 95,085 47.9 Nov. 22... 32,742 38,357 71,099 13,112 84,211 38.9 N De o c v . . 6 2 . 9 . . . . . . 4 43 1 , , 0 2 6 0 7 5 3 3 9 9 , , 1 5 3 2 5 4 8 82 0 , , 5 3 9 4 1 0 1 1 2 2 , ,7 9 1 2 5 7 9 95 3 , , 3 2 0 6 6 7 4 4 5 4 . . 2 2 Dec. 13... 50,096 38,294 88,390 11,807 100,197 50.0 Dec. 20... 45,475 31,250 76,725 12,175 88,900 51.2 Dec. 27... 47,960 29,204 77,164 12,239 89,403 53.6 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

528 ANNUAL EEPORT OF THE FEDERAL RESERVE BOARD. FEDERAL RESERVE BANK OF ATLANTA. MOVEMENT OF EARNING ASSETS DURING THE CALENDAR YEAR/918. Curve/: TVfc&anS&fter. CurreZ;Jofyzl3ills3iscowt£ed,. Curve 3; Mills ^Discounted and Jcfought. Curved; fficaZ6zrnzjt4Jfsse&, incl. U.S. GovernmentSecurities. CurveS.3taCzo ofTYarlban ytyver to JobzlSills Discounted^ and Sought. \\&' 120 \\50An o \W-\too\ 30 \vfo\ \eo M5H [so WH \60 \\2Si ISO \\m \40 \/5-\ \30 Wi \20 \SA JO wm. <ttl8&!8152 IS ISZ29SZ19X31017X317Ml&5S1326Z3 6233068X'24.f tl8St6JS&Z96BX!27\ JAN. \FEB\MCH.\APR.\MAY \JUHE\JVLY \A : UTTG5.g~p~:~ OCT. \mV.\DEC. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 6—ATLANTA. 529 EXHIBIT B.—Movement of cash reserves, net deposits, Federal Reserve note liabilities, and the reserve percentage of the Federal Reserve Bank of Atlanta during the calendar year, 1918. [In thousands of dollars, i. e., 000 omitted.] Federal T r o es ta e l r v c e a s s . h dep N o e s t i ts. a R n ct o e u t s a e e l s r c v in i e r (2+3) culation. Jan. 4 78,217 37,438 63,839 101,277 Jan. 11 75,774 31,907 62,850 94,757 Jan. 18.... 75,707 35,181 60,975 96,156 Jan. 25 74,928 34,383 59,739 94,122 Feb.l.... 73,544 35,180 58,511 93,691 Feb. 8.... 76,813 40,707 57,835 98,542 Feb.15... 70,406 34,158 57,262 91,420 Feb. 21... 73,652 34,889 58,937 93,826 Mar. 1.... 71,212 32,980 59,057 92,037 Mar. 8.... 66,703 31,296 58,486 89,782 Mar. 15... 69,075 32,847 58,355 91,202 Mar. 22... 65,295 32,957 58,006 90,963 Mar. 28-29 66,485 35,900 56,928 92,828 Apr. 5 66,932 37,490 56,744 94,234 Apr. 12... 64,439 31,742 59,334 91,076 Apr. 19... 64,641 36,077 58,921 94,998 Apr. 26... 61,431 31,378 58,541 89,919 May 3 55, 743 29,489 57,605 87,094 May 10.... 55,182 27,939 57,490 85,429 May 17.... 57,968 25,814 57,952 83,766 May 24.... 64,011 33,538 57,780 91,318 May 31.... 66,807 37,301 57,089 94,390 June 7— 64,689 37,128 56,748 93,876 June 14... 63,797 41,367 58,074 99,441 June 21... 65,619 37,501 57,477 94,978 June 28... 63,002 37,983 56,139 94,122 July 5 57,104 35,290 56,826 92,116 July 12.... 61,827 38,953 56,709 95,662 July 19.... 52,027 31,513 56,366 87,879 July 26.... 56,102 39,204 57,237 96,441 Aug. 2.... 49,063 34,403 58,558 92,961 Aug. 9.... 52,405 39,938 59,866 99,804 Aug. 16... 54,643 38,434 61,589 100,023 Aug. 23... 56,437 42,186 62,722 104,908 Aug. 30... 51,077 37,490 65,345 102,835 Sept. 6.... 49,194 32,626 73,303 105,929 Sept. 13... 56,120 31,800 85,078 119,878 Sept. 20... 58,468 36,610 92,294 128,904 Sept. 27... 63,732 46,765 97,941 144,706 Oct. 4 59,140 37,667 107,013 144,680 Oct. 10.... 68,286 40,558 111,640 152,198 Oct. 18.... 63,545 38,672 115,145 153,817 Oct. 25.... 67,094 35,250 116,582 151,832 Nov.l.... 72,725 55,076 116,070 171,146 Nov. 8.... 70,423 50,924 115,450 166,374 Nov. 15... 72,977 49,031 116,910 165,941 Nov. 22... 63,548 29,212 115,609 144,821 Nov. 29... 66,163 39,090 117,151 156,241 Dec. 6 65,350 39,898 117,432 157,330 Dec. 13... 65,993 44,222 118, 822 163,044 Dec. 20... 62,343 26,418 121,922 148,340 Dec. 27... 67,538 31,017 122,764 153,781 100823°—19- -34 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

530 ANNUAL EEPOKT OF THE FEDERAL, RESERVE BOARD. & FEDERAL RESERVE BANK OF ATLANTA. II DEPOSIT AND NOTE LIABILITIES, ALSO CASH RESERVES, DURING THE CALENDAR YEAR 1913. Curvel:JYettdefiosite. Carve 2'.• Jotal CasfvjUserves: , Curve3:JggreqateW&8eiWsita^FXJfote-£iMiteies- (I Cbcrve4.\fta£io ofCasfuSBeserpes tojlggregatx, Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 6—ATLANTA. 531 SCHEDULE 1.—Comparative statement of earnings and expenses. Federal Reserve Bank of Atlanta. [Combined statement of head office and branches.] 1918 1917 EARNINGS. Bills discounted and bought: Bills discounted—members and Federal Reserve banks.. $1,758,074.69 $231,635.57 Acceptances bought in open market 302,231.06 102,311.56 Investments: United States securities 114,451.31 140,820.48 Municipal warrants ~ 2,889.31 3,629.26 Bill of lading drafts 3,654.65 Profits realized on United States securities 11,139.06 25,568.99 Transfers—net earnings 33,756.92 17,134.05 Deficient reserve penalties (including interest) 35,240.00 13,526.88 Net service charges received 21,752.62 Sundry profits 9,868.94 6,758.45 Total earnings.. 2,293,058.56 541,385.24 EXPENSES. Assessments, expenses Federal Reserve Board.. 15,368.71 9,442.27 Federal Advisory Council 454.73 466.63 Governors' conferences 70.36 Federal Reserve Agents' conferences 142.30 Salaries: Officers 70,643.45 36,470.93 Clerks 124,938.35 37,892.48 Special officers and watchmen 5,28a. 40 3,424.10 All other 3,059.67 Directors' fees 2,295.00 2,188.08 Directors' per diem 2,548.40 2,540.00 Directors' traveling expenses 2,688.70 2,471.42 Officers' and clerks' traveling expenses 3,006.84 1,066.94 Legal fees 3,494.87 600.00 Rent. 18,722.10 12,152.92 Taxes and fireinsurance 3,275.90 1,210.64 Telephone 765.82 535.05 Telegraph 5,030.41 842.86 Postage 28,997.62 6,825.77 Currency shipments 4,665.11 Expressage 5,140.14 2,483.33 Insurance and premiums on fidelity bonds. 2,041.04 1,801.90 Light, heat, and power 762. 35 174.67 Printing and stationery 23,781.58 7,062.67 Repairs and alterations 132. 43 27.86 All other expenses 53,332.90 16,494.72 Total expenses of operation 380,639.18 146,475.22 Cost of Federal Reserve currency issued 149,390.49 54,808. 22 Cost of Federal Reserve notes unissued (on hand) , 14,320.00 Miscellaneous charges a/c Federal Reserve bank note issues.. 9,313.22 Depreciation: Furniture and equipment 88,130.35 8,177.80 Bank premises 12,797.34 2,500.00 Total current expenses. 640,270.58 226,281. 24 Gross earnings 2,293,058.56 541,385.24 Less total expenses.. 640,270. 58 226,281.24 Net earnings.. 1,652,787. S 315,104.00 SCHEDULE 2.—Statement of the condition of the Federal Reserve Bank of Atlanta. [Combined statement of head office and branches.] Dec. 31, 1918. Dec. 31, 1917 RESOURCES. Bills discounted—members $36,408,710.93 $11, 895,589.16 Member banks' collateral notes 47,626,800.00 2, 628,250.00 Acceptances bought in open market 12,514,685.61 6,4 97,061.67 United States bonds to secure circulation 261,600.00 Other United States bonds owned 292,150.00 397,000.00 One-year Treasury notes 667,000.00 491,000.00 United States Treasury certificates of indebtedness. 102,000.00 Municipal warrants : 13,000.00 284,372.00 Certificates of indebtedness to secure circulation 5,297,000.00 Bill of lading drafts *503"83i.'60 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

532 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. SCHEDULE 2.—Statement of the condition of the Federal Reserve Bank of Atlanta-^Coii. Dec. 31, 1918. RESOURCE s—continued. Cost of unissued Federal Reserve currency.. Interest accrued on United States securities. 24,961.80 Other deferred charges 2,957.31 Bank premises 217,000.00 Disbursements, fiscal agent department 456,208.21 Total. 701,127.32 Due from other Federal Re'serve banks Due from branches and offices Exchanges for clearing house 2,876,114.04 Checks and other cash items 122,324.66 National bank notes and notes of other Federal Reserve banks. 4,119,829.00 Other mutilated currency for redemption Deferred debits: Federal Reserve Banks- Transfers bought Other items 9,981,436.18 Branches and offices 2,518,975.61 Member and nonmember banks 16,399,909.62 Total. 36,018,589.11 Due from United States Treasury 5 per cent fund. 310,690. 00 Federal Reserve bank notes on hand 269,000.00 Federal Reserve notes on hand. 2,786,200.00 Mutilated Federal Reserve notes for redemption... 161,655.00 Nickels and cents 1,336.40 Total. 3,528,881.40 Gold with Federal Reserve agent 42,179,185.00 Due from United States Treasury gold redemption fund. 6,957,760.00 Gold settlement fund 6,302,193.45 Gold bullion and coin 1,900,488.42 Gold certificates (including clearing-house certificates) 6,086,890.00 Gold with foreign agencies 174,866.23 Silver certificates (including clearing-house certificates)... 55,544.00 Legal-tender notes (including clearing-house certificates). 165,009.00 Silver coin 16,690.50 Total reserve..., 63,838,626. 60 Total resources.. 207,270,170.97 LIABILITIES. Capital paid in. 3,191,350.00 Surplus 775,000.00 Profit and loss.. Total 3,966,350.00 Discount on United States bonds 830.70 Unearned discount—bills discounted 163 689. 75 Unearned discount—acceptances bought... 64, 460.60 Unearned interest on municipal warrants. 75.11 Reserved for sundry expenses 47, 572.19 Difference account 384.04 Total. 277,012.39 United States Government deposits 2,839,711.85 Due to other Federal Reserve Banks Due to member banks, reserve account 46,222, 851.15 Due to nonmember banks, clearing account 40, 931.30 Reserved for franchise tax 735, 000.00 Cashier's expense, return item and dividend checks. 173,9 56.21 Gold settlement fund—suspense 6,973,4 58.15 Deferred credits: Federal Reserve Banks 5,199,5 68.72 Branches and offices 375, 302.29 Member and nonmember banks 9,013,2 87.09 Miscellaneous 1,746,8 56.82 Total. 73,320,923.58 Federal Reserve notes outstanding 123,620, 285.00 Federal Reserve bank notes outstanding. 6,085,6 00.00 Total 129,705,885.00 Total liabilities. 207,270,170.97 121,661,062.53 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 6—ATLANTA. 533 SCHEDULE 3.—Earnings, expenses, and dividend payments for calendar year 1918, also amounts carried to surplus fund and reserved for Government franchise tax. Capital Dec. 31,1918 $3,191,350.00 Earnings for 1918 2,293,058.56 Expense of operation $380,639.18 Cost of Federal Reserve currency (including expressage, insurance, etc.) 149,390.49 Miscellaneous charges account note issues J 9,313.22 Furniture and equipment, total amount charged off during year 88,130.35 Total current expenses 627,473.24 Net earnings for year 1,665,585.32 Less: Depreciation on bank premises $12,797.34 Other depreciation allowances or extraordinary items charged to profit and loss account 315.30 Total deductions 13,112.64 Net amount available for dividends, surplus, and franchise taxes 1,652,472.68 Dividends paid: Date paid, June 30,1918; period covered, Jan. 1,1918-June 30, 1918. $88,078.07 Date paid, Dec. 31,1918; period covered, June 30,1918-Dec. 31,1918 94,349.49 Interestpaid on stock surrendered 45.12 Total dividend payments 182,472.68 Carried to surplus fund 735,000.00 Transferred to account " Reserve for franchise tax " 735,000.00 Total ' 1,652,472.68 SCHEDULE 4.— Third Liberty loan—Analysis of subscriptions to Treasury certificates of indebtedness, series of Jan. 22, Feb. 8, Feb. 27, Mar. 20, Apr. 10, and Apr. 22, 1918. Number of Number of Percentage Percentage banks in banks sub of banks in of banks to Amount of district. scribing. sub d s i c st r r ib ic i t n g. su n b u sc m r b ib e i r n g. subscriptions. National banks 380 332 87.36 28.09 $44,019,000 State banks 1,608 843 52.43 71.32 34,502,000 Trust companies 10 7 70.00 .59 713,500 Total 1,998 1,182 59.16 100.00 79,234,500 14 338,500 Grand total 1,998 1,196 79,573,000 SCHEDULE 5.—Fourth Liberty loan—Analysis of subscriptions to Treasury certificates of indebtedness, series of June 25, July 9, July 23, Aug. 6, Sept. 3, Sept. 17, and Oct. 1. Number of Number of Percentage Percentage b d a is n t k r s i c in t. b s a c n r k i s b i s n u g b . o su f b d b s i a c s n t r r i k b i s c i t n i g n . o su f n b b u s a c m n ri b k b s e i r n t g o . su A b m sc o r u ip n t t i o o f n s. National banks 394 315 80.00 27.30 $69,015,500 State banks 1,753 832 47.46 72.10 44,658,500 Trust companies 10 7 70.00 .60 803,500 Total 2,157 1,154 53.50 100.00 114,477,500 Miscellaneous 17 379,500 Grand total .. . . . . 2,157 1,171 114,857,000 i Including both Federal Reserve notes and Federal Reserve bank notes. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

534 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. SCHEDULE 6.— Tax series—Analysis of subscriptions to Treasury certificates of indebtedness, tax series of Jan. 2, Feb. 15, Mar. 15, Apr. 15, May 15, Aug. 20, and Nov. 7,1918. Number of Number of Percentage Percentage banks in banks sub of banks of banks to Amount of district. scribing. subscribing. number subscriptions. subscribing. National banks 394 124 31.47 35.63 $15,440,500 State banks 1,753 220 12.55 63.22 10,483,500 Trust companies 10 4 40.00 1.15 155,000 Total 2,157 348 16.11 100.00 26,079,000 Miscellaneous 18 271,000 Grand total 2,157 366 26,350,000 SCHEDULE 7.—Analysis of subscriptions to third Liberty loan. ALABAMA. Number Number Per cent i o n f S ba ta n t k e s . s o u f b i b n s g c a . r n i k b s s o u f b b in s a g c n . r i k b s su A bs m c o ri u p n ti t o o n f s . National banks 91 91 100 $12,278,800 State banks 257 240 93 10,821,550 Trust companies 1 1 100 60,100 Miscellaneous 21,000 Total 349 332 95 23,181,450 FLORIDA. National banks 56 56 100 $11,068,550 197 180 91 6,902,000 Trust companies 1 1 100 60,850 Miscellaneous 22,500 Total 254 237 93 18,053,900 GEORGIA. National banks 97 95 98 $16,050,950 State banks 671 612 91 22,294,650 Trust companies 4 4 100 448,200 Miscellaneous 237,300 Total 772 711 92 39,031,100 TENNESSEE. National banks 89 89 100 $16,025,650 State banks 253 229 90 6,392,100 Trust companies 2 2 100 364,200 Miscellaneous 4,450 Total 344 320 93 22,786,400 LOUISIANA. National banks 27 24 89 $8,620,800 State banks 137 127 97 17,182,750 Miscellaneous 702,350 Total 164 151 93 26,505,900 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 6—ATLANTA. 535 SCHEDULE 7.—Analysis of subscriptions to third Liberty loan—Continued. MISSISSIPPI. i o N n f u S b m a ta b n t e k e r s . s o N u f u b i b n m s g a c . b n r i e k b r s s o P u f e b i r b n s g a c c . n r e i n k b t s su A bs m c o ri u p n t t i o o n f s. National banks... 18 16 89 $3,640,400 State banks 120 104 86 4,449,750 Trust companies Miscellaneous ! 50 Total 138 120 90 8,090,200 RECAPITULATION. National banks 378 371 96 $67,685,150 State banks 1,635 1,492 71 68,042,800 8 8 100 933,350 Miscellaneous 987,650 Central American 500 Total 2,021 1,871 92 137,649,450 SCHEDULE 8.—Analysis of subscriptions to fourth Liberty loan. ALABAMA. Number Number Per cent of banks of banks of banks Amount of in State. subscrib subscrib subscriptions. ing. ing. National banks 91 91 100 $18,559,850 260 251 97 17,568 700 1 1 100 39,000 Miscellaneous 48 950 Total 352 343 99 36,216,500 FLORIDA. National banks 55 55 100 S17,063,550 State banks 198 181 92 10,298,250 1 1 100 132,000 Miscellaneous 44 550 Total 254 237 93 27 538 350 GEORGIA. National banks 98 96 98 $27,034,250 State banks 670 622 93 31,886,850 Trust companies 4 4 100 902,900 Miscellaneous 2,990,550 Total 772 722 93 62,814,550 TENNESSEE. National banks 90 90 100 $26,115,450 State banks 257 238 92 10,747,700 Trust companies 2 2 100 720,050 600 Total 349 330 94 37,583,800 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

536 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. SCHEDULE 8.— Analysis of subscriptions to fourth Liberty loan—Continued. LOUISIANA. Number Number Per cent i o n f S ba ta n t k e s . s o u f b i b n s a c g r n . i k b s s o u f b i b n s a c g r n . i k b s su A b m sc o ri u p n t t i o o n f s. 27 26 96 $13,685,300 State banks 135 122 90 26,093,250 2 1 50 15 450 882,200 Total 164 1.49 91 40,676,200 MISSISSIPPI. National banks 18 17 95 $5,941,550 State banks 120 108 90 7,114,150 Trust companies Miscellaneous 100 Total 138 125 92 13,055,800 RECAPITULATION. 379 375 98 $108,399,950 State banks 1,640 1,522 92 103,708,900 10 9 90 1,809,400 Miscellaneous 3,966,950 Total 2,029 1,906 94 217,8,85,200 Total subscriptions in sixth district .$217,885,200 Quota of sixth district . 192,000,000 Number of subscribers in sixth district.. 947,047 State. Pop 1 u 9 l 1 a 0 ti . on, Quota. Subscription. s N u u b m sc b r e ib r er o s f . Alabama... 2,138,093 $30,230,000 $36,216,500 203,230 Florida 752,619 23,931,000 27,538,350 113,051 Georgia 2,609,121 54,319,000 62,814,550 251,961 Tennessee.. 1,536,298 32,701,000 37,583,800 168,193 Louisiana.. 1,167,265 38,529,000 40,676,200 94,792 Mississippi. 895,516 12,290,000 13,055,800 117,830 Total. 9,098,912 192,000,000 217,885,200 947,047 City. Pop 1 u 9 l 1 a 0 ti . on, Quota. Subscription. N su u b m sc b r e ib r er o s f . Birmingham 132,685 $8,332,650 $9,698,000 47,515' Mobile 51,521 3,225,950 3,516,100 10,565 Montgomery. 38,136 2,455,950 2,514,100 10,302 Jacksonville. 57,699 6,704,800 8,678,450 27". 131 Tampa 37,782 3,416,000 3,440,750 11,601 Atlanta 154,839 14,204,150 17,342,000 39,031 Savannah 65,054 6,282,200 6,364,400 23,579 Augusta 41,040 3,117,350 3,635,650 11,645 Macon , 40,665 2,872,050 3,070,150 9,672 Nashville 110,364 9,532,850 11,949,150 38,856 Chattanooga. 44,604 6,361,350 6,761,550 26,105 Knoxville 36,346 3,685,550 4,397,200 15,420 New Orleans 339,075 28,904,500 28,373,900 67,031 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 6—ATLANTA. 537 SCHEDULE 9.—Confirmation and ciqssijication of subscriptions. Nifmber of subscribers. Amount. 540,150 at $50 $27, 007,500 280,360 at $100 28, 036,900 46,558 at $150 to $450, inclusive 12, ,179,350 34,583 at $500 17, 291,500 5,166 at $550 to $950, inclusive 4,, 090,550 27,583 at $1,000 to $1,950, inclusive 29,, 981,000 3,850 at $2,000 to $2,950, inclusive 8,, 104,100 1,134 at $3,000 to $3,950, inclusive , 694, 750 559 at $4,000 to $4,950, inclusive %, 2 62,400 2,910 at $5,000 14, ,521,000 126 at $5,050 to $5,950, inclusive 749,300 271 at $6,000 to $6,950, inclusive ,329,700 185 at $7,000 to $7,950, inclusive ,387,950 88 at $8,000 to $8,950, inclusive 738,400 109 at $9,000 to $9,950, inclusive 949,700 1,909 at $10,000 ,145,000 1,352 at $10,050 to $50,000, inclusive r 111, 150 95 at $50,000 to $100,000, inclusive ,391,300 39 at $100,050 to $200,000, inclusive ,686,650 LIST OF SUBSCRIPTIONS OVER $00,000. lat 300,000 1 at 550,000 NEW ORLEANS BRANCH. lat 202,000 2 at - 600,000 lat 400,000 lat 500,000 lat 750,000 947,047 Total 217,885,200 SCHEDULE 10.—Annual report of transit operations, Federal Reserve Bank, Atlanta, Ga., 1918. NUMBER OF ITEMS HANDLED. Clearing house. Sixth district. Oth R e e r se F r e v d e e . ral Total. January— 40,169 287,035 37,262 364,466 February.. 43,700 289,211 38, 763 369,674 March 45,475 325,750 44,798 416,023 April 46,706 322,603 47,450 416,759 May 50,787 350,232 43,427 444,446 June....... 43,808 367,241 46,048 457,097 July 42,128 469,200 59,186 570,514 August 44,958 562,823 51,275 659,056 September. 44,753 511,329 47,548 603,630 October — 66,270 581,777 61,355 709,402 November. 124,026 579,509 79,483 783,018 December.. 134,510 599,997 65,217 799,724 Total. 727,290 5,246,707 619,812 6,593,809 AMOUNTS. January— $64,143,841.54 $68, 548, 581.38 $36,535,142.67 $169,227, 565.59 February.. 57, 752,180.12 61, 476, 669.41 34,639,098.57 323,095, 513.69 March 73,148,311.95 60, 261, 062.55 73,285,421.96 206,694, 796.46 April 65,104,900.03 67, 136 481.71 83,273,019.40 215,514, 401.14 May 82,144,994.50 85, 097! 634.45 97,123,007.88 264,365, 636.83 June 61,880,737.16 91, 767, 015.28 80,583,988.32 234,231, 740.76 July 39,961,669.88 119, 989, 920.10 75,147,610.38 235,099, 200.36 August 39,595,972.02 134, 770, 883.01 71,876,343.41 246,243, 198.44 September. 49,749,262.56 156, 969, 303.16 72,491,290.92 279,209, 856.64 October — 107,738,577.59 155, 494 377.86 102,297,315.25 365,530, 270.70 November. 145,261,313.82 175, 294', 144.68 101,736,080.81 422,291, 539.31 December.. 143,111,913.77 144 890, 486.27 93,781,413.28 381,783, 813.32 Total 929,593,674.94 1,321,696,559-! 922,769,732.85 3,174,059,967.65 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

538 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. SCHEDULE 10.—Annual report of transit operations, Federal Reserve Bank, Atlanta, Ga., 19 IS—Continued. NUMBER OF ITEMS AND AMOUNTS OF UNITED STATES TREASURER CHECKS. Number of items. January— 37,594 February.. 36,334 March 43,896 April 52,504 May 48,540 June 46,980 July 72,140 August 85,276 September. 109,780 October 125,470 November. 104,720 December.. 92,346 Total 855,670 Average number of items handled per day, 24,423; average amount of items handled per day, $11,764,- 894.26; number of banks in this district remitting at par, 635. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO 7.—CHICAGO. WILLIAM A. HEATH, Chairman and Federal Reserve Agent. Measured both by performance and by the financial result of oper ation, the Federal Feserve Bank of Chicago has just closed a remark able year. Without the facilities made available through the bank, the burden of war financing would have been a serious handicap to industrial activity for war purposes in a district where resources are largely agricultural and the business turnover is necessarily slow. The task of obtaining subscriptions to and providing the facilities for the payments for Liberty bonds, in addition to the heavy war taxes in a single year, and at the same time caring for abnormal business requirements, afforded a severe test of the various functions of the Federal Eeserve Bank. In its fiscal agency operations in 1918 the Federal Reserve Bank of Chicago distributed 11,096,577 coupon bonds, involving 208,956 registered shipments, through its bond de partment, while it financed the Treasury through the cash sale and distribution to banks, corporations, and individuals of bonds and certificates of indebtedness to the extent of approximately $3,000,000,000. This expansion of facilities, so as to render the greatest possible service to the Treasury, the member banks, and to business in general, neces sarily involved a considerable increase in the cost of operation, but despite the increased expenditure, the Federal Reserve Bank of Chicago showed a surplus of $3,100,000 for the year 1918, after all charges, payment of dividends, and reservation for the statutory franchise tax. In extending the facilities of the Federal Reserve Bank of Chicago to member banks it has been necessary to expand its note issue. Federal Reserve notes in circulation at the close of the year aggre gated $428,820,000, as compared with $181,160,000 at the beginning of the year, an increase of $247,660,000. It is safe to say that Govern ment financial operations were chiefly responsible for this abnormal expansion. On the other hand, comparative statements of the Fed eral Reserve Bank of Chicago at the beginning and close of 1918 show an increase of approximately $192,738,000 in its gold stock. On De- 539 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

540 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. cember 31, 1918, the gold available as reserve against Federal Reserve notes in circulation, after setting aside 35 per cent against net deposit liability, was 81.5 per cent. On the same day the total reserve against combined net deposit and note liability was 66.1 per cent. The cam paign for the transfer of gold from individual banks to the Federal Reserve Bank accounts for $53,000,000 of the 1918 increase in the stock of gold. There also has been collected during the year and turned into the Treasury approximately $12,400,000 in silver and silver cer tificates. In its fiscal agency operations the Federal Reserve Bank of Chicago not only has had the cooperation of banks and bond distribut ing organizations, but also the services of individuals identified with these organizations, contributed as a patriotic duty. Such coopera tion has contributed greatly to the success of the year's undertakings. Appreciation of the services and facilities afforded by membership in the Federal Reserve system is indicated by the interest taken by State banks in the Seventh Federal Reserve District. Considerably more than one-half of the total resources of eligible banks operating under State charters are now represented by memberships in the Federal Reserve Bank of Chicago. The character of the services performed in the year 1918 is clearly depicted in the following resume* of the operations of the Federal Reserve Bank of Chicago and in the statistics and charts accompany ing this report. FINANCIAL RESULTS OF OPERATION. Earnings for the year 1918 aggregated $8,481,747, compared with $2,020,714 in 1917 and $665,955 in 1916. From the gross earnings of 1918, however, there should be deducted $155,672 because of the discontinuance of the service charges in the transit department, the disbursements without income in the second half of the year more than absorbing the income in excess of disbursements covering the first half. This made the total earnings of the bank $8,326,075, which compares with $2,022,278 for 1917, the latter figure including a credit from the transit department operations. The total expenses for the year 1918 aggregated $1,495,002, com pared with $792,526 in 1917 and $262,730 in 1916. The net income for the year, however, was $6,805,081, compared with $1,229,751 in 1917 and $403,205 in 1916. The earnings for the year 1918 were equivalent to 60.84 per cent on the paid-in capital as of December 31, 1918. The balance sheet as of December 31, 1918, shows $247,091,000 of total earning assets, compared with $125,490,000 at the close of the previous year and $26,475,000 at the end of 1916. The total cash reserve at the close of 1918 was $423,574,000, compared with $230,833,000 at the close of 1917 and $54,379,000 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 7—CHICAGO. 541 at the close of 1916. The total assets shown were $779,187,000 at the close of business December 31, 1918, compared with $401,905,000 at the end of the previous year and $118,790,000 at the end of 1916. The capital account showed $11,185,050 in capital paid in and $3,316,022 in surplus, compared with $9,091,700 paid-in capital and $215,799 surplus at the close of 1917, and $6,683,550 paid-in capital at the close of 1916. The total Government deposits on December 31, 1918, were $6,566,000, compared with $3,052,000 at the close of 1917 and $2,04*5,000 at the close of 1916. The total "due to member banks —reserve" at the close of 1918 aggregated $230,604,000, against $169,174,000 at the end of 1917 and $95,390,000 in 1916. The balance sheet also showed $450,938,000 of Federal Reserve notes at the end of 1918, compared with $190,788,000 at the close of the previous year. The detailed profit-and-loss account and balance sheet will be found in the appendix accompanying this report (Schedules 1 and 3). TREND OF DEPOSITS. The trend of deposits for the year 1918 has been consistently upward. Reference to net deposit figures compiled as at the close of business each Friday during the year shows that the lowest point touched was about $116,000,000, while the high point for the year was $226,000,000. For the first six months deposits averaged about $152,000,000, while for the last six months the average was about $196,000,000. This considerable increase is attributed to the increase in the deposit accounts of member banks, necessitating larger reserves, as well as to the growth in our membership through the addition of 217 State banks during the year. GENERAL BUSINESS CONDITIONS. General business was active at the close of the year, with banking conditions in the Seventh Federal Reserve District sound. Neces sarily the volume of business is being somewhat curtailed as war contracts are completed or canceled, but in the readjustment to peace conditions the volume of accumulated business, which dur ing the war it was impossible to care for, has taken up a considerable amount of the slack caused by the let down in war production. Instances of this are found in the automobile industry, in the manu facture of furniture and other articles which war economy and conservation of manufacturing facilities affected. The agricultural situation is promising, the seed going into the ground last fall under favorable conditions, and the wheat acreage in this district is large. The labor situation in consequence of this readjustment is slowly improving. There is still a shortage in some lines of skilled work- Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

542 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. men, but a noticeable improvement in the supply of common labor available, whereas before the signing of the armistice this class of labor was exceedingly scarce. Women are being released from factories and shops where they were engaged in war production, and are returning to their former lines of activity, while a general effort is being made among employers to care for those released from mili tary service by the Government. A striking feature in the general business situation at the close of the year was an apparent desire of all elements to contribute as far as possible to an orderly readjust ment to a peace basis. The readjustment of wages to a peace" basis is apparently being deferred until commodity prices and other items entering into the cost of living have shown a substantial decline. The money market, which during the year ruled remarkably steady for a war period, closed the year with rates ranging from 5 J to 6 J per cent, but with 6 per cent quotable as the prevailing rate in most instances. DISCOUNT OPERATIONS. Throughout the year 1918 the greater portion of the total earning assets of this bank was represented by discounts for member banks involving United States Government war obligations as secu rity in one form or another. On January 2, 1918, the percentage of the " bills discounted" by this bank representing war financing was 25 per cent. Until September 13 there was no segregation on our ledgers of the item "bills discounted" into paper given for the purchase of Government obligations and paper given for com mercial or industrial purposes. Figures available after September 13 show that of total "bills discounted" as high as 77 per cent was war paper, while the lowest percentage shown in the subsequent weeks of 1918 was 62 per cent. For the first half of the year the financial operations of the United States Government in the Seventh Federal Keserve District were not reflected in a particularly striking manner in borrowing from the Federal Reserve Bank of Chicago, "bills discounted" ranging between $62,000,000 to $125,000,000, with the average somewhat below $100,000,000. That "total earning assets" ranged between $100,000,000 and $150,000,000 in that period, averaging in the neighborhood of $125,000,000, was due to the accumulation of accep tances aggregating in amount $50,000,000 in the early part of April. The amount of acceptances later was allowed to run down to a nominal figure, but acquisition was resumed again later in the year, reaching almost $100,000,000 in the middle of December. The middle of the year found practically all banks in the district short of surplus funds, due to their absorption by the successive Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 1—CHICAGO. 543 indebtedness, and the exceedingly large requirements of essential business. This condition made recourse to the Federal Reserve Bank of Chicago imperative, and such recourse was immediately reflected in a growth of the item "bills discounted77 from about $125,000,000 to $250,000,000 at the end of July. This was maintained with but negligible fluctuations until the peak $279,308,000 was reached in the early part of November. There followed between the middle and the end of November a sharp decline, amounting to about $70,000,000, $183,400,000 being touched before a brief recovery set in. In the first three weeks in December there was a decline to around $154,000,000, with a subsequent recovery to nearly $160,000,000. The highest point reached by the item "total earning assets77 was recorded at the beginning of November, when the total touched $326,944,000. Investment operations were confined to one purchase, amounting to $1,000,000 of municipal warrants, on January 23 and sold on Jan uary 28, and to United States securities, which ran along between $5,000,000 and $15,000,000, until the last Friday in October, when the total increased to $47,000,000, receding sharply to $15,000,000 in the first week in November. This total again increased, and at the end of the year amounted to slightly more than $20,100,000. During the year there were 22,864 applications for rediscount approved for 850 banks, as follows: Number of banks. Amount. Illinois 168 $1,741,500,084 Indiana 125 184,405,140 Iowa 333 385,191,839 Michigan 128 612,080,430 Wisconsin 96 342,672,516 Total 850 3,265,850,010 In addition to this, $222,838,671 in bankers' acceptances were pur chased in the open market and from other Federal Reserve Banks, represented by bills drawn in connection with imports or exports or based upon domestic shipments or storage of goods and accepted by institutions of known responsibility. The amount of United States Government bonds, certificates of indebtedness, and notes purchased by the Federal Reserve Bank of Chicago during the year aggregated $30,276,950, exclusive of bonds and certificates taken under repurchase agreements. The amount of these sold during the year aggregated $14,342,550. The investment of the Federal Reserve Bank of Chicago in warrants and bonds of four municipalities with maturities ranging from 60 to 143 days, purchased in the open market and sold, was $1,000,000. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

544 ANNUAL REPOKT OF THE FEDERAL RESERVE BOARD. Naturally, in a war period, with such unprecedented imperative financing as took place in the year just closed., the rediscounting operations of the Federal Reserve banks were very large in volume, and the Federal Reserve Bank of Chicago, operating in a territory the wealth of which is very considerably invested in agricultural and allied pursuits, shared liberally in this class of rediscounting. In the general rediscounting operations, however, paper was carefully scrutinized in order to determine whether it represented essential or nonessential enterprises, and as far as practicable the policy was adhered to of caring for the extensions of credit regarded as essential to the successful prosecution of the war. TRADE ACCEPTANCES. In the very nature of things the developnent of the use of trade acceptances in this district has been slow, but some progress has been made during the last year, as is evidenced by a moderate increase in the volume in the hands of banks and the number of concerns which have adopted trade acceptances in their business. There appears to be an active interest in most lines of business in the subject of trade acceptances, but from the information received from the users of trade acceptances and also those considering their adop tion, it would seem that the banks of this district are not actively promoting the use of the trade acceptance by their customers. Prob ably this is explained by the pressure under which the banks have been working. While they realize the necessity of rendering the reserve money more mobile through the creation of a broader discount market for commercial paper, the banks may not yet have fully appreciated the value of the machinery provided by the Federal Reserve system by which high-grade business paper can be rediscounted throughout the country, nor have business concerns fully realized how the use of trade acceptances and bankers' acceptances commands preferential rates. BANKERS7 ACCEPTANCES. It also has been the policy of the Federal Reserve Bank of Chicago to encourage the development of an open market for bankers' accep tances in this district, but this, too, is very slow in developing. Thus far the chief support of business in bankers' acceptances has come from the Federal Reserve Banks. It is appreciated by the officers of the Federal Reserve Bank of Chicago that acceptances, however, must depend upon a broader market than that afforded by the Fed eral Reserve Banks if this class of paper is to come into general use as a form of credit and that business is to be expanded. At present there are comparatively few banks in the Seventh Federal Reserve District which regularly buy bankers' acceptances, and these are Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 7—CHICAGO. 545 among the larger institutions. The number doubtless would be much larger were it not for the great volume of United States Gov ernment certificates of indebtedness absorbing available funds seeking employment. Public and private corporations at times having funds for which it is desirable to find temporary employment are showing increasing interest in acceptances. Some already have adopted the policy of investing these funds in a well-assorted list of eligible bankers' acceptances because of their liquidity and the more satisfactory interest return. The storage and movement of grain, meats, provisions, woolens, and tobacco, which heretofore have been financed largely through acceptances known as "domestic bills/' also is stimulating interest among banks in the development of a broad mid-West acceptance market. The limited amount of surplus funds available for investment in acceptances probably accounts for the slight encouragement which the few brokers offering acceptances here have received from the Middle West banks. Some of the brokers and banking houses say they have been unable to make any progress even in the purchase and sale of the acceptances of local concerns from and to local banks. During the year 1918 seven Chicago banks and one Wisconsin bank applied for powers to accept up to 100 per cent of their combined capital stock and surplus. The approval of these banks last year brought the list of authorized accepting banks up to 11, all of which, with the one exception mentioned, were Chicago banks. The list of banks authorized to accept up to 100 per cent of their capital and surplus will be found in the appendix (Schedule 6). PURCHASE OF ACCEPTANCES. The policy of the Federal Reserve Bank of Chicago in the purchase of acceptances has been to absorb such acceptances as are offered direct by member banks of this district, and also to sell acceptances to banks in this district whenever the member banks inquire for them. It seems necessary, however, in order to develop any considerable volume of business, that an active campaign be made to interest banks and banking houses of this district more generally in the handling of acceptances. RESERVE POSITION. That in spite of the heaviest demands ever made upon the sources of the Federal Reserve Bank of Chicago it was possible to maintain cash reserves at a figure averaging above 60 per cent for the whole year has been due chiefly to the patriotic response to the appeal for mobilization of gold and gold certificates throughout the district, Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

546 ANNUAL REPORT OF THE FEDERAL RESERVE" BOARD. into the regional bank, as well as to the growth of its deposits through the gratifying increase in the membership of State banks. An intensive campaign in which member and nonmember banks were canvassed and asked to turn in their gold and gold certificates, accepting Federal Reserve notes in exchange therefor, bore fruit, and too much can not be said for the banks whose spirit of cooperation was so helpful. During the unprecedented advance in the loan item in the month of July, the consequent upward trend of the deposit and note liability resulted in a decline of cash reserves from about 65 per cent to approximately 45 per cent, the low point for the year. Though deposit and note liability continued to expand to almost $650,000,000, at the end of the year the ratio of cash reserves had advanced by a consistent upward trend from never below 49 per cent to about 67 per cent. At the close of the year it was slightly in excess of 66 per cent. GROWTH OF MEMBERSHIP. During the year the Federal Reserve Board approved applications for stock in the Federal Reserve Bank of Chicago from 13 national banks and applications for surrender of stock from 9 national banks. In the appendix (Schedules 7 and 8) will be found the names of the institutions whose stock was surrendered, as well as the disposition made of them; also a list of the new national bank members. The following table contains figures showing the growth in membership of State banks in the Federal Reserve Bank of Chicago. State bank membership statistics, Federal Reserve Bank of Chicago, by years of admission. 1914 1915 1916 1917 1918 Total. Illinois 1 2 19 35 57 Indiana 2 17 19 Iowa 1 8 68 77 Michigan 2 31 80 113 Wisconsin 1 1 3 17 22 Total 2 5 1 63 217 288 The increase in State bank membership from 63 in 1917 to 288 in 1918 is very gratifying and has added considerably to the strength of the Chicago Reserve Bank. These institutions on December 31, 1918, held in excess of one-third of the total capital stock in their regional bank. This may be ascribed to the exigencies of the financial situation, which made it necessary for State institutions to enlist help in carrying their share of the Government's war obligations, as well as to an intensive campaign from this office through which their membership was solicited. State bank members admitted in Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 7—CHICAGO. 547 FIDUCIARY POWERS. During the year 25 applications from national banks for power, under section 11 (k) of the Federal Reserve Act were approved, bringing the total number of banks having such powers up to 125. Schedule 10 in the appendix lists the banks granted these powers in 1918. DEPARTMENT OF BANK EXAMINATIONS. Among the provisions of the Federal Reserve Act are the following: The Federal Reserve Board shall be authorized and empowered to examine at its discretion the accounts, books, and affairs of each Federal Reserve Bank and of each member bank, and to require such statements and reports as it may deem necessary. * * * Every Federal Reserve Bank may, with the approval of the Federal Reserve agent or the Federal Reserve Board, provide for special examination of member banks within its district. * * * Special examinations shall be so conducted as to inform the Federal Reserve Bank of the condition of its member banks and of the lines of credit which are being extended by them * * *. As a condition of membership, such banks (State) shall likewise be subject to examinations made at the 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 Federal Reserve Banks 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 Federal Reserve Board * * *. Early in the present year the Federal Reserve Bank of Chicago organized a department of bank examinations in order to be pre pared to meet the requirements of the act in this particular. During the year some examinations of national banks have been made by this department. A number of State banks applying for membership have been specially examined, and in a large number of instances representatives of this department have visited State banks applying for membership in order to satisfy themselves as to conditions which were not made clear by reports of State examinations submitted. It has been the endeavor of this department to cultivate friendly relations with the State banking departments in all of the States included in this district, and it is pleasing to note that most cordial relations exist between this department and the various State banking departments. The disposition to be mutually helpful is manifest on both sides. Examinations of national banks are largely standardized; on the contrary, each State has a method of its own. It is obvious, there fore, that the reports of State examinations, no matter how efficiently conducted, do not in all cases contain all of the essential or detailed information which is deemed necessary by the Federal Reserve Bank or the Federal Reserve Board. The latter body has recently sug gested an outline of more complete cooperation between Federal Reserve Banks and the various State banking departments, and the Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

'548 ANNUAL, REPORT OF THE FEDERAL RESERVE BOARD. Federal Reserve Bank of Chicago has enlarged its examining force in order that the proposed plan may be more effectively carried out. Under this plan examinations will, as a rule, be conducted as hereto fore by the State banking departments; but representatives from the Federal Reserve Bank will, so far as practicable, be present during the progress of such examinations, and it is believed that through such practice closer coordination may be had and more efficient results obtained for the benefit of all those interested. It is gratifying to state that this plan appears to have met with the approval of the banking departments of the various States. STATE BANK RESERVES. The reserve percentages against deposit liability required by the banking departments of the five States in the Seventh Federal Reserve District differs from those required under the Federal Reserve Act. In the State of Michigan, however, an amendment to the banking law provides that Michigan State bank members of the Federal Reserve system may satisfy reserve requirements of their State departments by complying with percentages obligatory under the Federal Reserve Act. Moreover, in the other States there is a liberal attitude toward member banks in the matter of reserves, providing they maintain a percentage which satisfies the require ments of the Federal Reserve Act. GOVERNMENT WAR FINANCING. In the very nature of things Government war financing over shadowed all other classes of business in the Federal Reserve Bank of Chicago. The Seventh Federal Reserve District is composed almost entirely of agricultural territory, and this made the problem of financing its quota of subscription payments for the various issues difficult. It is true the district contains several important manufac turing and commercial centers and that dotted all through the ter ritory are manufacturing cities, but the bulk of the wealth is invested in either agriculture or industries closely allied to agriculture, and hence the income is dependent largely upon that business and the turnover is slow. Despite this handicap, however, the quota of the third and fourth Liberty loans, aggregating between 14 and 15 per cent of the total offerings, was oversubscribed in each instance, the Treasury being financed in advance of actual payment for the bonds through the absorption of certificates of indebtedness offered to the banks from time to time. The statistics relating to the fiscal agency operations appearing in the appendix of this report indicate the character of the response to the Treasury offering (Schedules 11 to 16). Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 7—CHICAGO. 549 In obtaining a wide distribution of the certificates of indebtedness the allotment system proved beneficial, because it gave all banks an amount which should equal their subscriptions, and afforded an incentive to bring their subscriptions up to the amount of their quota by stimulating a spirit of competition between banks. The effect of the general and wide distribution under the Government war financing program has been to acquaint many banks, especially the smaller institutions, with the advantages of holding as secondary reserve short-time paper—a development which would have been ordinarily difficult to bring about through voluntary offerings. The educational value of this experience, therefore, is great, and is ex pected to prove far-reaching in its effect. The record of subscriptions of all banks in the Seventh Federal Reserve District to the first four series of Treasury certificates indicates a steadily increasing interest in these short-term war obliga tions. The figures compare as follows: Series I. Series II. Series III. Series IV. Allotment $77,693,000 $138,597,000 $325,355,000 $663,204,000 Number of subscriptions 1,348 3,121 13,792 29,544 At the closing of the subscription lists two-thirds of all the banks in the district were recorded as having subscribed for an amount equal at least to the minimum quota of the anticipation certificates of the fourth Liberty loan assigned them. Allotted subscriptions to certificates of indebtedness in anticipation of loans and in pay ment of Federal taxes in the Seventh Federal Reserve District aggregated $1,427,609,500 in 1918, of which $988,559,000 were cer tificates in anticipation of the third and fourth loans, and $132,794,500 were in anticipation of the 1918 taxes. The total also includes $125,831,000 sold in, anticipation of taxes due in 1918 and 1919, and $180,425,000 in anticipation of the fifth Liberty loan. DEPOSITS OF TREASURY FUNDS WITH BANKS. During 1918 the number of depositary banks increased from 288 to 1,060. The maximum payment by depositary credit increased from $96,000,000 on the occasion of the first pa}^ment on the second Liberty loan to $174,000,000 on the October 24 payment of the fourth Liberty loan. The latter amount represents 31 per cent of the total amount paid on that date, the remainder being 27 per cent in cash and 42 per cent paid by certificates of indebtedness. On the December 5 issue of certificates the amount paid by depositary credit was $65,598,000, or 67J per cent of the total subscriptions. From January 1 to December 1, 1918, a grand total of $1,464,093,765 had been deposited to the credit of the Government in depositary Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

550 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. banks. The collateral held to secure deposits increased from $139,000,000 on January 1 to $257,000,000 on October 30 last. In conducting the work of this division it has been the endeavor to simplify the forms and operations necessary, and as a result the depositary banks are now handling transactions with the use of fewer forms and in a more direct manner than before and are show ing an increasingly cooperative spirit. It has been possible to adjust the work so that within about two hours after receiving a call from Washington for funds, notices of withdrawal are in the mails. Payments made by banks against calls on war loan deposit accounts are now prompt in practically every instance, and whereas six months ago on every payment date there were from 30 to 40 delinquents, the delinquent list now rarely exceeds half a dozen, although the number of depositaries has increased 100 per cent. This has been accomplished through the systematic use of the mails and wires in~ regard to overdue payments to show the necessity of promptly mak ing funds available for the use of the Treasury on the date set in notices. There has been the fullest cooperation from State custodians and securities committees and no effort has been spared by custodians to render services promptly or to anticipate any difficulties which might arise through error on the part of depositary banks. FLOTATION OF LIBERTY LOANS. The accompanying statistics show the character of the under taking in obtaining subscriptions for and in allotting and delivering to subscribers Liberty bonds in the volume represented by the quota given to the Seventh Federal Reserve District and in the wide dis tribution of these subscribers. Every effort was made to simplify and standardize all forms used in connection with the Liberty loan subscriptions and payments, with the view of reducing the number of errors made by banks in submitting subscriptions or loan pay ments. This found its reflection in the decrease in the volume of correspondence compared with the experience with relation to the first and second Liberty loans. In the distribution of the third and fourth Liberty loans in the Seventh Federal Reserve District, which comprises 58 counties in the northern part of Illinois, 68 counties embracing the northern two-thirds of Indiana, 68 counties embracing all of Michigan except ing the northern peninsula, 45 counties embracing the southern two-thirds of Wisconsin, and 99 counties comprising the entire State of Iowa—a total of 338 counties for the entire district—a comprehensive sales organization was found necessary. This Liberty loan organization, formed under the direction of the Federal Reserve Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 7—CHICAGO. 551 sis ted of a general committee, composed of representative citizens, two of whom were women, appointed directly by the governor of the Federal Reserve Bank, represented six subdivisions, embracing: (1) Chicago and Cook County, (2) Illinois outside Cook County, (3) Indiana, (4) Iowa, (5) Michigan, (6) Wisconsin. This general com mittee in turn operated through an executive committee, composed of executives of representative banks and allied interests. This executive committee directed the campaign through the Liberty loan campaign committee, composed of a director, and in the instance of the fourth loan, an assistant director, and a cabinet made up of the sales director of each of the six subdivisions, director of publicity, director of the speakers' bureau, and a secretary-treasurer. In the fourth loan the position of executive secretary was abolished and his duties were combined with that of the treasurer, an arrangement which proved very satisfactory and efficient. So satisfactory has this general organization proved that it is contemplated utilizing it prac tically in this form in connection with the fifth Liberty loan. (See Schedule 17, appendix.) In the campaign for subscriptions the Seventh Federal Reserve District Liberty loan committee used largely what is called the uindividual quota" system outside of Cook Coimty and Chicago, and had the war continued this system would in time probably have been perfected so as to apply to the Chicago territory. No effort, however, was made to add to the quota allotted, so that the results in subscriptions to the two loans were exceedingly satisfactory. It is asserted on the basis of statistical information that more people per thousand have bought Liberty bonds in this district than in any other in the country. The Central West has learned to buy bonds. In the first loan the Seventh Federal Reserve District showed 600,000 total subscribers, on the basis of 4 per cent of popu lation computed on the 1910 census. The per cent of quota sub scribed on the "basis of official report of application'' was 1.18. The amount of subscriptions equaled $26.79 per capita, with an average subscription of $586, whereas in the second loan the total number of subscribers on the ubasis of official report of application" was 1,809,497, or 14 per cent of the population, the per cent of quota subscribed being 139, the per capita $44.63, and the average sub scription $324, while in the third loan the total number of subscribers on the "basis of official report of application" was 3,535,792, or 27 per cent of population, with a total subscription equivalent to $46.44 per capita, and 143 per cent of quota subscribed, and an average subscription of $172. The total subscriptions in the Seventh Federal Reserve District to the third loan were $608,878,000. Analysis of the official assignments, subscriptions, and subscribers Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

552 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. Federal Reserve District of 4,241,703, with an average application of $229. The per cent of quota subscribed was 111; the per capita application amounted to $73.88. Subscriptions in the Seventh Fed eral Reserve District to the fourth Liberty loan aggregated $969,646,600. Fully 85 per cent of all railroad employees in the Seventh Federal Reserve District were enlisted as purchasers of bonds of the third Liberty loan issue. The average subscription was $65.48, and the total amount, $12,826,600, was distributed to 195,876 employees. In the fourth loan the percentage of railroad employees who sub scribed for Liberty bonds was in excess of 97, with an average sub scription of $100. The distribution, therefore, was increased be tween 12 and 15 per cent and the average purchase was. increased $35. The Liberty loan sales organization embraced 48 organizers and 365 paid employees during the peak of the campaign. To this should be added approximately 300,000 volunteer workers. In the central clearing house in Chicago 400 were employed at the peak of the cam paign, while 80 were distributed among the 35 ward stations. The cost of handling this business in the third loan was $30,000, while in the fourth loan it aggregated about $40,000. Three hundred and twenty-five were employed in the distribution and publicity depart ment. A maximum of 80,000 pieces was distributed. The maxi mum volume of applications cleared at Chicago in a single day was 82,000 pieces (subscriptions), involving $18,000,000. The various activities of the fiscal agent's department has resulted in a great increase in the number of employees other than in the Liberty loan sales organization. On January 1, 1918, 129 employees were engaged in this department, whereas at the close of the year 1918 the number reached 300. WAR-SAVINGS CERTIFICATES. The work of the Federal Reserve Bank of Chicago in connection with the sale of war-savings certificates and thrift stamps has been comparatively light. This bank was not called upon to direct that feature of the war financing until the middle of October, so that it was impossible to increase the results of the organization already in existence during 1918. The bank, therefore, has furnished only about one-eighth of the total sales of stamps in this district, the remainder having been put out by the Post Office Department. Considerable attention, however, has been given to the matter of broadening the scope of the organization for sales of the war-savings certificates and thrift stamps for the purpose of increasing the sale during the coming year. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 7—CHICAGO. 553 WAR FINANCE CORPORATION. The Federal Keserve Bank of Chicago has not participated in any of the functions of the War Finance Corporation. This bank was not called upon to act as representative of the corporation in handling applications for loans under the terms of the act, and such applica tions or inquiries as were directed here were redirected to Washington. DISTRICT COMMITTEE ON CAPITAL ISSUES. The activities of the district committee on capital issues for the Seventh Federal Eeserve District began immediately after the appointment of the main committee. Its membership consisted of 17 (afterwards increased to 19), the majority being from Illinois and residents of Chicago. Each of the other States included in the seventh district, however (Indiana, Iowa, Michigan, and Wisconsin), was most efficiently represented in the committee's membership. The first meeting of the committee was held on February 2, 1918. An executive committee of five (afterwards increased to seven) was selected by the main committee at Washington, and acting under the plan of procedure recommended for all districts, assumed charge of activities for the district, the remaining members forming an advisory body to be called into consultation as necessity required. Eegular sessions of the executive committee were had, usually on Tuesdays and Thursdays, and during the life of the body 75 meetings were held in all. It became apparent at the outset that the volume and importance of matters to be presented for consideration called for systematic procedure. Therefore, a competent and experienced secretary was at once appointed, with power to employ necessary assistants. As a result, each application as received was carefully analyzed, additional information obtained, if needful and possible, and tabulated in very condensed and concrete form for presentation. In this way a very large number of applications was disposed of at each session without delay in any cases where all essential facts were available. It was the policy of the committee to grant special hearings wher ever asked for, and in some cases the committee requested applicants to appear before it. The total number of such.hearings was, how ever, not large. Few appeals from the committee's findings were made, and few of the recommendations of the district committee were overruled by the main committee at Washington. In all, some 600 applications were considered. An exhibit of these, classified and giving figures, appears in the appendix (Schedules 18 and 19). This, however, by no means represents all the results accomplished, for hundreds of projects, totaling probably very large figures, were de- Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

554 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. ferred merely on oral advice of committee members. It was im possible to keep a proper record of them. The response of the public generally to the appeal of the com mittee for cooperation was widespread and very gratifying. The committee was aware, however, that at times its existence was ignored (but not in all cases deliberately) and that in parts of the district the credulous were still being importuned to exchange their cash and Liberty bonds for unauthorized or "wildcat" issues. It was, however, powerless to correct this situation. FEDERAL RESERVE NOTE ISSUE. Elsewhere in the text of this report there has been furnished a discussion of the issue of Federal Reserve currency by this bank during the year. In the appendix will be found a table and chart covering the trend of the liability on account of Federal Reserve note issue; also a table indicating interdistrict movement of Fed eral Reserve currency and a table recording the amount of notes issued by the Federal Reserve Bank of Chicago and outstanding December 31, 1918. (See Schedules 20 to 22, Exhibit B, and chart.) FEDERAL RESERVE BANK NOTE ISSUE. At the close of business December 31, 1918, there were outstand ing $18,525,800 in Federal Reserve bank notes. This currency is at present available in $1, $2, $5, $10, and $20 denominations. Dur ing the campaign for the withdrawal from circulation of silver certificates it has been the policy of this bank to pay out Federal Reserve bank notes in an amount approximating the amount of incoming silver certificates. The appendix contains a table cover ing the amount of these notes put in circulation and redeemed dur ing the year. At the close of the year $19,609,800 in United States securities were on deposit with the United States Treasurer as secu rity for outstanding Federal Reserve bank notes. POSITION OF COMMERCIAL BANKS. Necessarily the commercial banks of the district not only felt the effects of the demands of the Government upon their resources in the matter of purchasing Government securities, but also they have felt the effect of the high prices of practically all raw materials. Naturally these high prices made it necessary for borrowers to use much more money for the same volume of business than was needed before the war. These two elements have caused the banks gener ally throughout the district to borrow liberally from the Federal Reserve Bank of Chicago. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 7—CHICAGO. 555 The effect of war financing on commercial paper from the stand point of the banks naturally would be that of subjecting makers to a more careful scrutiny of the credit risk. Credits extended before the armistice was signed were based primarily upon their essential character to a very considerable extent, whereas after the armistice was signed and war needs relaxed, credits were viewed from the standpoint of ability to get back to a safe and profitable peace basis. The consequence of this shift in viewpoint neces sarily has contributed to a most careful examination of credits, which in the war period were regarded as the strongest. Not withstanding the heavy war demands, the banks in the Seventh Federal Reserve District are believed to be in a relatively strong position and hence able to care for all reasonable demands of gen eral business. In the performance of the functions for which it is created, the Federal Reserve Bank of Chicago will continue to meet the situations as they arise, extending to deserving member banks its facilities of discounting with a view to aiding them in caring for credit require ments of general business, and at the same time- conserving credits to the extent necessary for the furtherance of Government financing yet to be done. DETROIT BRANCH. The branch bank at Detroit, Mich., authorized by the board of directors at its regular meeting on November 27, 1917, was for mally opened for business on March 18, 1918. The branch immediately began to justify its creation in handling with expedition certain dealings formerly had by Detroit member banks direct with the parent bank. There is effected a saving of a day's time in receiving credit for paper offered for discount, as well as the immediate accessibility of an adequate supply of Federal Reserve currency. Up to the present time the Detroit branch handles checks on banks located in the city of Detroit alone. By the deposit of currency or the discount of paper Detroit mem ber banks are immediately supplied with Chicago exchange in the form of a credit on the books of the Federal Reserve Bank of Chicago. This business has been handled to the satisfaction of both the Detroit member bankers and the board of directors of the Federal Reserve Bank of Chicago. While the results of the operation of the branch are combined in the profit and loss statement for the head office, an idea of the scope of its operations may be gained from the bal ance sheet appearing in the appendix (Schedule 2). Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

556 ANNUAL BEPOKT OF THE FEDERAL RESERVE BOARD. INTERNAL ORGANIZATION. M. B. Hutchison, of Ottumwa, Iowa, a class B director, group 2, of the Federal Reserve Bank of Chicago, died August 6. This vacancy was filled by the election of A. R. Erskine, president of the Studebaker Corporation, South Bend, Ind., who will fill the unex pired term ending December 31, 1920. George M. Reynolds, Chicago, class A, group 1, and A. H. Vogel, of Milwaukee, class B, group 3, were reelected for the full three-year term. William A. Heath was reappointed by the Federal Reserve Board as a class C director for the full three-year term, and designated as Federal Reserve agent and chairman of the board. The board held 12 regular meetings during the year. The executive committee is composed of James B. McDougal, governor; J. B. Forgan, George M. Reynolds, James Simpson, and the Federal Reserve agent. This committee had two regular meet ings each week during the last year. The membership committee is composed of the Federal Reserve agent, James B. McDougal, governor, and A. H. Vogel, a director. The plan of holding daily informal meetings of the officers of the bank has been followed throughout the year, except where it was interfered with in some instances by unusual activities in connec tion with the Liberty loan campaigns and other emergencies. B. G. McCloud was promoted from cashier, the position which he has filled since the organization of the bank, to a newly created position, " assistant to the governor," and S. B. Cramer, an assist ant cashier, was elected cashier. This change took place in the closing weeks of 1918. During the year it became advisable to increase the official staff of the bank, and seven additional assistant cashiers were appointed as follows: Kent C. Childs, F. Bateman, J. H. Dillard, A. H. Vogt, O. J. Netterstrom, F. R. Hanrahan, F. A. Lindsten. Mark A. Lies, assistant Federal Reserve agent, having entered the service of the United States Army early in November, 1918, W. H. White, manager of the department of bank examina tions, was appointed as assistant Federal Reserve agent to fill the vacancy. The officers and directors of the Detroit branch, organized early in 1918, consisted of John Ballantyne, Emory W. Clark, Julius H. Haass, Charles H. Hodges, and Robert B. Locke, all of Detroit. The officers of that branch are: Robert B. Locke, manager and chair man of the board; J. G. Baskin, assistant Federal Reserve agent; William M. Cation, cashier; and J. B. Dew, assistant cashier. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 7 CHICAGO. 557 FEDERAL RESERVE CLEARING SYSTEM. Operations of the clearing system show a remarkable increase in volume. The daily average in the number of items drawn on banks in Chicago increased approximately 70 per cent, while the daily average of items on banks outside of the Federal Reserve cities in creased approximately 137 per cent. The daily average of items drawn on banks in other districts increased approximately 111 per cent. The number of member banks in the district at the close of the year was 1,332, compared with 1,103 at the close of the preced ing year and 992 at the close of 1916, whereas the number of nonmember banks on the par list at the end of 1918 was 2,392, com pared with 2,240 at the end of 1917 and 1,265 at the close of 1916. In connection with the clearing operations attention is called to the fact that the direct-sending system has been granted to a number of banks when time can be saved. For instance, under such condi tions, if the volume of items warrants it, arrangements may be made with the Federal Reserve Bank of Chicago for direct routing between member banks of this district and other Federal Reserve Banks and their branches. In this way there is a considerable saving in time, but this also results in a decrease in the number of items handled through the clearing system by the Federal Reserve Bank of Chicago. The Federal Reserve Bank of Chicago now settles the clearing bal ances not only for Chicago, in accordance with arrangements made more than a year ago, but also for Detroit and Milwaukee. The Detroit balances are settled through the Detroit branch, while the Milwaukee balances are settled through the Federal Reserve Bank of Chicago by telegraphic transfer. The increase in the Government checks approximates 236 per cent. (See Schedules 24 and 25.) TRANSFER OPERATIONS AND LEASED-WIRE SYSTEM. It having become evident that the encouragement of telegraphic transfers of credit would be advisable, in order to conserve banking reserves and thus strengthen the banking position, this was under taken early in 1918 by the Federal Reserve Board through a series of steps increasing the cost of mail transfers and reducing the cost to member banks of telegraphic transfers. At the beginning of 1918, the Federal Reserve Bank of Chicago was purchasing from member banks transfer drafts or exchanges on other Federal Reserve cities and branch cities at the rate of 5 cents per thousand per day discount, which was equivalent to about 2 per cent per annum. Sales were made at the same rate. During January, 1918, the bank purchased mail exchange amounting to $254,181,000, and sold mail exchange amounting to $53,635,000. During that Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

558 ANNUAL, REPORT OF THE FEDERAL RESERVE BOARD. period no telegraphic transfers were purchased, but the bank sold $5,000,000 of telegraphic transfers at par. On April 15 the rates for purchases of mail exchange were increased from 5 cents per thousand per day discount to 10 cents per thousand per day discount, or about 3J per cent per annum. The selling rate was increased from 5 cents per thousand per day discount to 7 J per cent per thou sand per day discount. The bank still continued to receive a large volume of mail exchange for immediate credit, which in April amounted to $253,656,000. In order that the reserve position of the bank might be strengthened as far as possible, the rates on purchases of mail exchange were again increased on August 1, so that this volume might be reduced to a minimum. Telegraphic transfers of funds were made without cost, and transactions of this nature were encouraged. The bank's purchasing rate on mail exchange was increased from 10 cents per thousand per day discount to 15 cents per thousand per day discount, which was equivalent to about 5^ per cent per annum, while the selling price remained the same, 7h cents per thousand per day discount. This had the desired effect, as purchases by draft dropped from $208,000,000 for the month of July to $77,000,000 for the month of August, while there was a corresponding increase in transfers bought by wire. During July the bank purchased $84,000,000 telegraphic transfers, while in August the purchases amounted to $205,000,000. The total of all purchases by draft has steadily decreased, until now it averages less than $50,000,000 a month, while the banks' telegraphic transfers purchased average $200,000,000 a month. (SeeSchedule23.) In order to give prompt attention and efficient service to the member banks in telegraphic transfer, and to afford quicker commu nication between the Treasury and the Federal Reserve Board at Washington and the various Federal Reserve Banks, it was deemed advisable by the Board to install a leased-wire system between the Board and the Federal Reserve Banks. This leased-wire system was put into operation during the week beginning June 3, 1918. Additional wires have since been installed, and now all branch banks are included in the system. Washington and Chicago were made rela}^ points for the East and West, respectively. The Federal Reserve Bank of Chicago was given charge of the operations of the system, and the chief telegraph operator is stationed in this office, with a supervising operator at Washington (the other relay office) as an assistant. - Since the installation of the system the volume of business has grown until it has become necessary to make the Chicago-Cleveland- Washington wire a full duplex. An additional wire from Chicago Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 7—CHICAGO. 559 to New York, via Washington, has been added, also one from Chicago to St. Louis, making the total of the leased-wire system centering in the Federal Reserve Bank of Chicago in excess of 10,000 miles. At present 29 operators, including the chief, are employed in the main-line offices, and about 20,000 messages are carried monthly over the system, while 65 per cent of this number are relay. COLLECTION DEPARTMENT. Under date of July 1, 1917, the Federal Reserve Bank of Chicago advised its member banks that it would receive for collection clearing-house notes and bills and miscellaneous drafts drawn on any point in the United States, subject to a service charge of 10 cents per item in addition to the actual exchange deduction made by the collecting bank. For a time the member banks were very slow to avail themselves of this privilege, and the majority of the items received by the Federal Reserve Bank were drawn on Chicago. The majority of the items drawn outside of Chicago were received from the large Chicago banks, and in most instances were drawn on Federal Reserve cities. These items could be collected without an exchange deduction. In the first year of the operation of this collection feature the Federal Reserve Bank of Chicago handled an average of 76 items a day, 49 of which were drawn on Chicago. In order to stimulate interest in this collection system, the Federal Reserve Bank of Chicago on July 1, 1918, suspended the service charge of 10 cents per item, and after that date no charge was made other than to cover the charges made by the collecting bank, except that a charge of 15 cents per item was made for items returned unpaid. The purpose of the charge on returned items was to discourage the use of "dunning drafts," which many banks have found burdensome. In the six months ending December 31, 1918, during which no service charge per item was made other than those referred to, the Federal Reserve Bank of Chicago handled an average of 362 collection items a day, which were received from banks distributed as follows: Items. c P en er t . Items. c P e e n r t . Other Federal Reserve Banks 156 43 Chicago banks... 10 Member banks located in other Iowa banks 6 Federal Reserve districts 50 14 Wisconsin banks Indiana banks 33 9 Michigan banks. Illinois banks (outside of Chicago). 25 7 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

560 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. GOLD SETTLEMENT FUND. The importance of the gold settlement fund in developing the rapid transfer of credit, thus enabling elimination of an unnecessarily large float resulting from the slower method of communication by mail, has been clearly demonstrated by the experiences of the Federal Reserve Bank of Chicago in the last year. These experiences, how ever, except as to volume, do not differ materially from those of other Federal Reserve Banks. The statistics covering the changes which have taken place from time to time on the gold settlement fund as it relates to the Federal Reserve Bank of Chicago are shown in Schedule 26. FOREIGN ACCOUNTS. In 1918 no new foreign accounts were established by the Federal Reserve Bank of Chicago. A year ago the Federal Reserve Bank had a sterling gold account with the Bank of England aggregating $7,350,000. In the course of the year this decreased, until on De cember 31, 1918, it amounted to only $816,042. It is expected that the export business of the country will increase with the restora tion of peace and the free movement of international commerce, and the Federal Reserve Bank of Chicago, in order to enable business interests to take full advantage of the opportunity for developing com merce in foreign fields, is pursuing the policy of assisting in the devel opment of proper banking facilities. BANKING QUARTERS. During the year it has been necessary, in order to accomodate the various features of the bank's operations, for the Federal Reserve Bank of Chicago practically to double its space in the Rector Build ing, 79 West Monroe Street. In addition to this, it occupies prac tically the entire floor of another office building and a very large floor space in a third building to house its fiscal agency operations, besides using vault space in several of the large banks and trust companies in Chicago. In planning for the future, the directors, at the end of 1918, pur chased a site with a street frontage of 165 feet and a depth of 160 feet on La Salle, extending from Quincy Street to Jackson Boule vard. This is probably the most desirable site for the purposes of the Federal Reserve Bank in the city of Chicago, and the ground was acquired at an exceedingly low cost, the purchase price being $2,936,149. Plans for building operations have not yet been fully developed. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 7—CHICAGO. 561 EXHIBIT A.—Movement of principal earning assets of the Federal Reserve Bank of Chicago during the calendar year 1918. [In thousands of dollars; i. e., 000 omitted.] Discount s S e e t d c U a u t n p e r i s e a t d p e w d e b r a y r - dis p O c a o t p h u e e n r r t . ed (1+2) m i b n o B a u o r il k p g ls e e h n t t . d T i b o s o c t a a u o n l u g d b n h i t t l . e l d s P ( e 1 r + c 5 e ) n t ea T r o n t i a n l g obligations, Jan. 4... 25,863 68,249 94,112 8,370 102,482 25.2 113,635 Jan. 11.. 26,032 54, 857 80,889 8,578 89,467 29.1 100,504 Jan. 18.. 38,838 67,332 106,170 9,002 115,172 33.7 128,663 Jan. 25.. 41,468 69,456 110,924 8,521 119,445 34.7 133,981 Feb.1.. 50,704 49,958 100,662 10,039 110,701 45.8 126,473 Feb. 8.. 43,034 34,668 77,702 10,899 88,601 48.6 101,417 Feb. 15. 46,587 37,254 83,841 14,401 98,242 47.4 110,931 Feb. 21. 43,025 35,085 78,110 15,927 94,037 45.8 106,465 Mar. 1.. 5,303 30,360 35,663 19,073 54,736 9.7 107,449 Mar. 8.. 8,030 28,189 36, 219 19,432 55,651 14.4 99,385 Mar. 15. 4,357 29,490 33,847 20,649 54,496 8.0 92,682 Mar. 22. 5,035 29,142 34,177 27,025 61,202 8 2 101,884 Mar. 29. 6,164 31,673 37,837 27,655 65,492 9.4 115,890 Apr. 5.. 5,957 29,542 35,499 47,024 82,523 7.2 135,718 Apr. 12. 20,988 25,153 46,141 46,446 92,587 22.7 126,624 Apr. 19. 33,614 30.103 63,717 48,103 111,820 30.1 128,370 Apr. 26. 56,496 32,057 88,553 48,002 136,555 41.4 148,741 May 3... 48,965 34.903 83,868 47,356 131,224 37.3 142,799 May 10. 38,974 48,908 87,882 45,665 133,547 29.2 144,456 May 17. 34,390 49,599 83,989 42,627 126,616 27.2 137,116 May 24. 32,719 48,052 80,771 41,011 121,782 26.9 132,261 May 31. 34,678 51,596 86,274 30,621 116,895 29.7 127,043 June 7.. 36,318 56,842 93,160 26,151 119,311 30.4 129,427 June 14. 33,822 60,513 94,335 24,380 118,715 28.5 128,807 June 21. 40,308 72,608 112,916 21,681 134,597 29.9 144,681 June 28. 47,452 78,548 126,000 18,414 144,414 32.9 154,466 July 5... 67,132 85,682 152, 814 18,831 171,645 39.1 180,847 July 12. 77,649 91,790 169,439 19,251 188,690 41.2 197,892 July 19. 79,893 111,568 191,461 18,368 209,829 38.1 219,031 July 26. 99,914 138,527 238,441 17,284 255,725 39.1 264,927 Aug. 2.. 109,210 128,575 237,785 8,583 246,368 44.3 252,989 Aug. 9.. 121,416 112,568 233,984 9,549 243,533 49.9 250,153 Aug. 16. 112,132 90,432 202,564 13,180 215,744 52.0 222,364 Aug. 23. 126,725 82.904 209,629 14,714 224,343 56.5 230,964 Aug. 30. 120,533 93,619 214,152 15,740 229,892 52.4 236,513 Sept. 6.. 146,992 97,367 244,359 16,549 260,908 56.3 267,528 Sept. 13 151.361 92,500 243, 861 16,393 260,254 58.2 266,874 Sept. 20 157,717 80,792 238,509 17,211 255,720 61.7 264,341 Sept. 27, 169,044 72,618 241,662 20,272 261,934 64.5 271,565 Oct. 4... 187,576 66,974 254,550 34,047 288,597 65.0 298,228 Oct. 10. 193,575 59,144 252,719 37,063 289,782 66.8 301,403 Oct. 18.. 188,736 64,015 252,751 37,295 290,046 65.1 302,667 Oct. 25. 152,405 84,967 237,372 37,583 274,955 55.4 322,576 Nov. 1.. 184,276 95,032 279,308 32,515 311,823 59.1 326,944 Nov. 8.. 158,336 93,877 252,213 32,684 284,897 55.6 300,018 Nov. 15. 143,363 81,640 225,003 32,145 257,148 55.8 272,269 Nov. 22. 116,878 66,548 183,426 36,015 219,441 53.3 236,563 Nov. 29. 123,047 60,987 184,034 37,357 221,391 55.6 238,512 Dec. 6.. 113,544 65,515 179,059 97,624 276,683 41.0 293,805 Dec. 13. 116,904 56.104 173,008 98,137 271,145 43.1 288,266 Dec. 20. 103,493 50,401 153,894 90,361 244,255 42.4 263,376 Dec. 27. 106,124 54,668 160,792 75,068 235,860 45.0 255,981 100823°—19- -36 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

562 ANNUAL. REPORT OF THE FEDERAL RESERVE BOARD, FEPERAL RESERVE BANK OF CHICAGO, MOVEMENT OF EARNING ASSETS DURIN6 THE CALENDAR YEAR I9I8 : Qv*ycf:J^rJx>ajtShjier. (2irre2:S&M3ills!&iscou*ffic<& Gzrve3:3ftiUs ^Discounted, an&jooughtr. Oxrye&.&talSzrnuuiJlsseGSj vncl.V.S. 6ovcrrwunt Securities % Curve 5: Jtajtio of W&r£banJimer toJc>talSills^Discounted ojubj&oagktA \\ AGO\3 60\ \60\ m \330 \S$\ P? \300\ \S0\ MS \270 m\ \\40 \&0, \40\ \\3S\2fO \3S\ w \30\ ISO \2S\ \20 120 \20\ \90 \/s\ \ I 60 UO \30 d\ 4 It 18 XI 4IS2II8 KX29SZBdS3l0l?2t3t7l42l&SlZt926i31623306B2004II0X14 ISZZ296BXJ2?\ JAN. \FEB\ MCH \APR\ MAr\JUHE\JULY \AU6-\SEPT.\ OCT. \ NOV. \ DEC? Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTBICT NO. 7—CHICAGO. 563 EXHIBIT B.— Movement of cash reserves, net deposits, Federal Reserve note liabilities, and the reserve percentage of the Federal Reserve Bank of Chicago during the calendar year 1918. [In thousands of dollars: i. e., 000 omitted.] Federal reserve T r o es ta e l r v c e a s s . h dep N o e s t i ts n a o c te tu s a i l n (2+3) circulation. Jan. 4.. 236,802 159,312 81,798 341,110 Jan. 11. 249,523 162,426 78,199 340,625 Jan 238,427 177,494 80,276 357,770 Jan. 25. 203,704 147,982 80,165 328,147 Feb.l.. 202,411 139,725 79,667 319,392 Feb. 8.. 219,023 126,420 ,211 310,631 Feb.15. 220,173 135,136 86,355 321.491 Feb. 21. 233,702 139,764 "",442 330,206 Mar.l.. 243,639 142,788 .,477 341,265 Mar. 8.. 247,211 131,453 205,084 336,537 Mar. 15. 278,034 153,363 207,284 360,647 Mar. 22. 265,194 146,042 210,776 356,818 Mar. 29. 261,845 155,574 211,770 367,344 Apr. 5.. 239,273 142,404 221,851 364,255 Apr. 12. 236,333 128,756 223,405 352,161 Apr. 19. 262,551 152,490 227,620 380,110 Apr. 26. 252.423 163,124 227,155 390,279 May 3.. 266,666 169,015 229,526 398,541 May 10. 252,724 155,659 230,506 386,165 A A A M M M J J J A N J J J J J A S S N N N S S N O D D O O D D O u u u u u u u u e e u u e e u c e c e c e e u u o o o o c o a a a n n n n l l l g g t c t g p p c t c p p c l g y y y t . g y . y . y v v v v . . . . v e . . e e e . y . t t t t . . . . . . . . . . 1 . 1 2 1 2 5 4 2 1 3 1 2 1 1 7 2 2 2 1 9 2 2 3 2 6 8 1 l 1 6 2 2 2 0 6 2 9 1 8 1 5 4 8 4 7 . 3 7 0 0 . 3 . 6 3 7 0 5 . 2 9 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3 3 3 3 3 3 3 2 3 3 3 3 3 2 2 2 2 2 2 2 4 4 2 2 2 2 2 2 2 2 2 2 4 0 0 0 0 0 1 3 0 8 4 6 7 1 8 9 0 4 5 7 7 8 0 7 0 2 4 9 1 9 8 7 3 1 3 3 1 2 0 1 0 9 0 7 8 7 6 6 9 5 7 1 4 7 6 4 7 9 7 9 6 7 1 8 1 2 9 , , , , , , , . , , , , , , , , , , , , , , , , , , , , , , , , , 5 8 1 0 9 6 9 2 5 4 6 3 9 8 8 0 4 1 6 3 5 9 2 0 3 7 1 8 2 2 1 4 8 6 9 0 3 8 8 4 0 7 0 8 2 6 4 1 6 2 3 1 1 2 6 2 2 7 8 9 2 5 8 7 4 4 1 1 1 6 9 7 6 7 6 7 5 4 3 3 7 5 5 3 6 6 3 9 9 9 9 7 2 5 7 4 2 2 2 2 1 1 1 1 1 1 1 2 2 2 1 1 1 1 1 1 1 1 1 2 2 1 1 2 2 2 1 1 2 2 1 0 0 7 6 8 6 1 6 7 5 1 1 8 6 6 9 0 1 8 9 9 6 1 3 6 2 7 1 9 0 8 9 2 0 9 0 3 3 1 4 8 9 6 5 5 2 6 8 4 2 5 9 5 6 5 5 2 4 6 5 4 6 0 6 , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , 4 4 9 4 1 7 6 8 9 3 3 6 3 9 1 8 0 0 4 1 4 1 6 9 8 0 4 3 6 6 3 0 9 9 4 2 8 0 7 3 7 3 2 0 9 5 9 9 4 0 3 3 7 9 6 9 2 8 3 4 7 0 8 2 1 3 1 1 3 3 9 6 5 5 8 4 7 7 5 4 9 2 6 7 4 4 4 5 0 8 8 4 0 4 0 2 3 3 3 3 3 3 3 3 3 3 3 3 2 2 3 3 2 2 2 2 2 2 2 2 2 2 4 2 4 4 4 4 2 7 6 7 7 2 1 5 0 9 8 4 3 8 3 6 9 9 3 6 9 7 0 3 3 4 6 3 1 5 3 0 2 8 9 9 9 5 8 4 8 2 5 6 5 7 7 7 4 8 1 8 3 4 1 3 1 8 4 1 8 2 0 3 8 4 7 ' , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , 5 1 9 7 2 8 8 8 2 2 0 8 8 2 0 7 5 5 3 8 6 5 6 6 4 1 7 7 8 8 6 2 7 6 9 4 6 7 9 0 7 7 0 1 6 3 7 3 0 2 5 2 4 3 3 9 9 3 5 2 7 9 4 1 8 5 3 7 9 5 9 7 9 1 1 6 6 9 1 7 7 5 3 4 5 8 4 9 0 8 0 2 9 5 0 2 8 2 2 3 3 3 3 4 4 4 5 5 5 5 4 4 4 4 4 4 4 5 5 5 5 5 5 5 6 6 6 5 6 6 6 4 9 6 9 9 2 8 1 2 3 7 8 3 6 1 5 1 8 9 2 5 8 5 4 9 5 0 1 9 3 4 2 2 6 8 8 3 6 0 0 3 1 7 5 8 3 8 5 0 2 7 7 5 6 0 4 2 6 5 9 6 8 1 4 0 5 8 , , , , , , , , , , , , , , , , , . , , , , , , , , , , , , , , , 9 0 7 6 6 3 7 2 1 7 8 5 9 4 9 2 2 1 4 1 5 0 5 9 4 9 3 9 1 2 2 7 3 0 9 9 3 2 6 8 1 2 5 5 5 5 6 9 2 9 6 4 4 4 0 0 0 0 1 3 6 7 4 9 5 6 1 3 3 3 6 7 6 3 5 6 4 4 4 4 4 4 7 6 6 9 2 6 4 4 9 7 2 8 2 2 2 0 8 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

564 ANNUAL EEPOET OF THE FEDERAL RESERVE BOARD. FEDERAL RESERVE BANK Or CHICAGO. DEPOSIT AND NOTE LIABILITIES, ALSO CASH RESERVES, DURING THE CALENDAR YEAR 1918. s Curve!: %fleb2>e?tasCts. Curve2:J6tal CashJfeserres. i Carve 3:J?(jgrccaJte ^e^2>qtositcurvdJ^. JYbte /Za&itiJties. Carve4;Sta£Co of CasJvfieserves foJ?ggrega£e Jfefi &eito$i£ and, &t.Jl/o6e£uibCUCie3. \660\ \660\ \\SO- m \S0\ 60C\ • \eoo\ps § A \w- \sia ff t \9f0\ 6S\ \\60-4&A \46c\-eo\ W •SS\ W20 S vw\ In7" •so\ • W m r5""\3 60 m \360\ \\40- •4?\ \300\ m 'mwt \300\ i M m i \&o\ it m \240\ •B• loo W\ \I20 \/20\ \60 60\ \4 ff B2SI4 lS2tf4 /5S29SJ2H9&3Cf7*3l7 ftZXSZaXtS 6aX6tS&&4-ti Kf&tS S&mi3a& | JAN. 1 FEB\ MCH I J4PR. \MAYWUME IJULY \AUG- \SEPT.\ OCT. 1 #OK | DEC Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 7—CHICAGO. 565 SCHEDULE 1.—Balance Sheet—Comparative statement of condition of the Federal Reserve Bank of Chicago. Dec. 31,1918. Dec. 31,1917. Dec. 31, 1916. Bills discounted, members $164,088,997.94 $105,923,175.99 $4,437,460.35 Bills discounted, bought 62,880,918.85 9,182,429.93 10,337,161.09 United States bonds and notes. 20,121,500.00 10," 384,600.00 10,375,100.00 Investments 1,325,760.88 Total earning assets. 247,091,416.79 125,490,205.92 26,475,482.32 Real estate (site for new building) 2,936,149.26 Interest accrued on United States bonds and notes.... 86,001.33 63* 695." 66" 50,896.48 Premium on United States bonds 193,311.66 5 per cent redemption fund against Federal Reserve bank notes 829,390.00 Liberty loan bonds, $10 participation certificates 9,450.00 163,100.00 Furniture and fixtures 28,304.53 Cost of unissued Federal Reserve notes 67,957.83 Due from member banks, overdrafts 30, 941.45 330, 615.85 1,723.57 Due from Federal Reserve Banks 26,784, 494.45 5,992, 720.41 29,913,819.08 Federal Reserve Banks, transfers bought 6,5655 000.00 8,178, 412.26 Transit and exchanges for clearing house 41,060, 921.89 19,868, 657.09 4,692,553.71 Federal Reserve and national bank notes 26,819, 995.00 10,635, 500.00 2,986,185.00 Gold coin and gold certificates 23,234, 185.00 32,189, 305.00 27,600,625.00 Bank of England sterling gold account 816, 042,43 7,350, 000.00 Other lawful money 1,797, 544.96 963, 872.27 396,102.95 Gold settlement fund 106,772, 373.57 58,960, 460.00 26,183,000.00 Gold with Federal Reserve agent 275,803, 010.00 130,723, 530.00 Gold redemption fund Federal Reserve notes 15,151, 205.00 646, 490.00 200,000.00 Total cash reserve 423,574,360.96 230,833,657.27 54,379,727." Other assets 1,399,491.71 349,181.34 Total assets. 777,187,612.84 401,905,745.14 118,789,962.13 LIABILITIES. Capital paid in 11,185,050.00 9,091,700.00 1,683,550.00 Surplus • 3,316,022.56 215,799.18 Profit and loss • ""61*978*67 Reserve for franchise tax 3,100,223.38 Discount on United States bonds 89,248.50 77,603.50 Unearned discount 514,586.45 318,087.33 46,451.23 Unearned interest, investments 6,051.22 Reserved for sundry expenses 19,612.60 4,833.62 5,391.08 Difference account 1,784.72 254.61 Federal Reserve notes outstanding 450.938,010.00 190,788,530.00 Federal Reserve bank notes outstanding 18,525,800.00 Federal Reserve bank transfers sold 3,700,116.20 1,471,347.45 Liberty loan, $10 participation certificates sold. 9,450.00 163,100.00 Uncollected funds • 32,545,315.02 18,183,306.82 United States Government deposits 6,566,290.10 3,052,436.84 2,045,784.95 Due to Federal Reserve Banks 14,743,259.20 6,165,983.77 14,550,742.93 Due to member banks, reserves 230,604,383.69 169,174,348.05 95,390,012.65 Due to nonmember clearing banks 1,328,460.42 3,198,413.97 Total liabilities. 777,187,612.84 401,905,745.14 118,789,962.13 SCHEDULE 2.—Balance sheet of the Detroit branch, Federal Reserve Bank of Chicago, as at the close of business Dec. 31, 1918. ASSETS. Rediscounts $308,928.50 Rediscounts secured by United States securities 163,194.00 Collateral notes, United States securities 12,610,750.00 Acceptances 1,185,041.95 Total discounts and investments 14,297,914.45 Transit items, member and nonmember banks 4,373.32 Exchanges for clearing house 67,939.32 Total transit and exchanges for clearing house 72,312.64 Federal Reserve notes on hand 8,609,490.00 Nation Bank notes and notes of other Federal Reserve Banks 1,680,300.00 Gold coin and gold certificates 260,000.00 Other lawful money - - - - 595,003.84 Total cash reserve 855,003.84 Total assets. .• 25,515,020.93 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

566 ANNUAL, REPORT OF THE FEDERAL RESERVE BOARD. LIABILITIES. Unearned discount $16,373.69 Difference account 100.90 Cashiers' checks, etc 672.63 Due to head office 25,497,873.71 Total liabilities 25,515,020.93 SCHEDULE 3.—Profit and loss statement of Federal Reserve Bank of Chicago covering 1918, 1917, and 1916. 1918 1917 1916 Earnings for year $8,481,747 $2,020,714 $665,935 Net service charges in excess of transit department disbursement. U55,672 1,564 Total earnings 8,326,075 2,022,278 665,935 Expense of operation of bank proper 1,093,317 317,113 232,370 Other expenses 929 243 Cost of Federal Reserve currency issued (including expressage, insurance, etc.) 375,002 159,824 5,113 Cost of Federal Reserve currency unissued, charged off 13,679 43,001 Miscellaneous charges account note issued 13,004 2,314 Depreciation on furniture and equipment 32,225 25,000 Depreciation on United States bonds 237,118 1,495,002 792,526 262,730 Earnings for year 6,831,073 1,229,751 403,205 Less miscellaneous deductions 25,992 Net earnings for year 6,805,081 1,229,751 403,205 Profit and loss, Jan. 1 61,978 20,091 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 Net income 6,805,081 2 1,293,856 423,296 Dividends paid 603,602 862,131 360,648 Interest paid on stock surrendered 1,033 126 669 Profit and loss, Dec. 31, 1917 6,200,446 431,598 61,978 * Deduct from earnings. Figure represents cost of operation of transit department in excess of service charges which were discontinued June 15, 1918. 2 Dividends paid on June 29, 1917, covered the period from Jan. 1, 1916, to June 30, 1916, inclusive, and amounted to $205,710. Dividends paid on Dec. 29, 1917, covered the period from July 1, 1916, to Dec. 31, 1917, inclusive, and amounted to $654,347. SCHEDULE 4.—Discount rates, Federal Reserve Bank of Chicago, 1918. Collateral loans, 15 days or less Rediscounts: 16 to 30 days - 4! 31 to 60 days 4f 61 to 90 days 4* Agricultural paper, 91 days to 6 months 5i Secured by Government obligations, 1 to 15 days 4 Secured by Government obligations, 16 to 90 days l4i Trade acceptances: 1 to 15 days 4* 16 to 60 days 44 61 to 90 days 4* 1 Preferential rate of 4 per cent on paper secured by Fourth Liberty loan bonds where banks do not charge rate exceeding 4£ per cent. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 7—CHICAGO. 567 SCHEDULE 5.—Money rates in Chicago, 1918. January. February. March. April. May. June. Low. High. Low. High. Low. High. Low. High. Low. High. Low. High. Demand money 5* 6 ? 6 6 6 6 6 6 6 6 6 Commercial paper 51 6 6 6 6 6 6 6 6 6 6 Brokers' 6 months' paper... 51 6 6 6 6 6 6 6 6 6 6 Year money 51 G 6 6 51 6 51 6 51 6 51 6 A N c o c te e s p ta s n e c c e u s r ed by certifi 5 4 1 A 4i 4f cates of indebtedness 5 5 5 5 5 5 July. August. September. October. November. December. Low. High. Low. High. Low. High. Low. High. Low. High. Low. High. Demand money 6 6| 6 61 6 6 61 6 61 6 61 Commercial paper 6 6 6 6 6 6 6 6 6 51 6 Brokers' 6 months' paper... 6 61 6 61 6 61 6 61 6 61 51 61 Year money 51 61 51 61 51 61 51 61 51 61 51 61 Acceptances 41 4£ Notes secured by certifi cates of indebtedness 5 5 5 5 5 5 SCHEDULE 6.—Member banks in the Federal Reserve district of Chicago authorized to accept up to 100 per cent of their individual capital and surplus. Ap Name. Location. proved. First National Bank Chicago, 111 1915 National Bank of the Republic do 1916 Continental & Commercial National Bank.. do 1917 Merchants Loan & Trust Co do 1918 National City Bank do 1918 Drovers National Bank do 1918 Fort Dearborn National Bank do 1918 Corn Exchange National Bank do 1918 Harris Trust & Savings Bank do 1918 Union Trust Co do 1918 First National Bank Milwaukee, Wis.. 1918 SCHEDULE 7.—New national bank members, 1918. Shares Name of bank. Location. sub scribed. First National Bank Hume, 111 20 Minonk National Bank Minonk, 111 17 First National Bank Horlcon, Wis 24 Do Blanehardvillo, Wis. 17 First-Merchants National Bank La Fayette, Ind 90 First National Bank Cuba, 111 26 Security National Bank Sheboygan, Wis 300 Citizens National Bank Webb, Iowa 30 First National Bank Hinckley, 111 19 Do Gridley,Ill.. 11 Seymour National Bank Seymour, Iowa 36 First National Bank Roland, Iowa 22 Liberty National Bank Marine City, Mich... 38 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

568 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. SCHEDULE 8.—National banks liquidated during 1918. Shares Name of bank. Location. Disposition. surren dered. Farmers National Bank... Virginia, 111 Absorbed by Petefish, Skiles & Co., Vir 50 ginia, 111. M A Fi m e rs r e t c r h i N c a a a n n t t i s o N N n a a a t l t i i o B o n a n a n a l k l B B a a n n k k . . . La F d d a o o y ette, Ind.. ( Su B cc a e n e k d , e L d a b F y a F y i e r t s t t e - , M In er d c . h ants National 2 1 4 8 8 0 3 9 State National Bank Bloomington, 111. Succeeded by State Bank of Blooming- 210 ton, 111. First National Bank Carsonville, Mich... Absorbed by State Bank of Carsonville, 18 Mich. Fond du Lac National Bank. Fond du Lac, Wis. Merged with First National Bank, Fond 150 du Lac, into First-Fond du Lac Na tional Bank. Farmers National Bank. Valparaiso, Ind... Converted into Farmers State Bank, 60 Valparaiso, Ind. Fayette National Bank.. Connersville, Ind.. Consolidated with Farmers & Merchants 84. Trust Co., Connersville, Ind. SCHEDULE 9.—Additions to State bank membership in the Federal Reserve Bank of Chicago in 1918. ILLINOIS. Auburn Auburn State Bank. Geneva State Bank of Geneva. Barrington First State Bank. Hinsdale Hinsdale State Bank. Bloomington State Bank of Bloomington. La Grange The La Grange State Bank. Charleston Charleston Trust & Savings Magnolia First State Bank. Bank. Marshall The Marshall State Bank. Chicago Capital State Savings Bank. Martinsville Martinsville State Bank.1 Depositors State Savings Bank. Matteson First State Bank. Home Bank & Trust Co. Mattoon Central Illinois Trust & Savings Illinois Trust & Savings Bank. Bank. Madison & Kedzie State Bank Moline Moline Trust & Savings. Mechanics & Traders State Peoples Savings Bank & Trust Bank. Co. Mercantile Trust & Savings State Savings Bank & Trust Co. Bank. Mount Carroll Carroll County State Bank. Northern Trust Co. Oak Park Oak Park Trust & Savings North Side State Savings Bank. Bank. North Western Trust & Savings Oswego Oswego State Bank. Bank. Shannon State Bank of Shannon. Security Bank of Chicago. St. Charles Stewart State Bank. Des Plalnes Des Plaines State Bank. Sycamore Pierce Trust & Savings Bank. Eureka Farmers State Bank. Wenona First State Bank of Wenona. Evanston Evanston Trust & Savings Bank. INDIANA. Angola Steuben County State Bank. Peru The Peru Trust Co. Bargersville Farmers State Bank. Richmond Dickinson Trust Co. Connersville Farmers & Merchants Trust Co. South Bend American Trust Co. Cromwell Sparta State Bank. St. Joseph Loan & Trust Co. Hillsboro Hillsboro State Bank. South Whitley Gandy State Bank. Jamestown Citizens State Bank. Terre Haute The Terre Haute Trust Co. Kentland Kent State Bank. Tipton Farmers Loan & Trust Co. Marion Grant Trust & Savings Co. Winamac First Trust & Savings Bank. North Liberty North Liberty State Bank. IOWA. Algona County Savings Bank. Decorah Citizens Savings Bank. Alta Vista Alta Vista Savings Bank. Winnesheik County State Bank. Ames Story County Trust & Savings Des Moines Bankers Trust Co. Bank. Central State Bank. Audubon Iowa Savings Bank. Elberon Farmers State Bank. Avoca Avoca State Bank. Eldora Citizens Savings Bank. Barnes City Farmers Savings Bank. Elkader Elkader State Bank. Battle Creek Battle Creek Savings Bank. Ellsworth Farmers State Bank. Bellevue Bellevue State Bank. State Bank of Ellsworth. Blairsburg State Bank of Blairsburg. Fairbank Fairbank State Bank. Brighton Brighton State Bank. Fairfield Iowa State Savings Bank. Britt Commercial State Bank. Fostoria Citizens Savings Bank. Cedar Rapids Iowa State Savings Bank. Garwin Garwin State Bank. Chariton State Savings Bank. Germania Farmers & Drovers State Bank. Charter Oak Farmers State Bank. Gilbert Gilbert Savings Bank. Cherokee Cherokee State Bank. Humboldt Peoples State Bank. College Springs Farquhar Savings Bank. Jefferson Jefferson Savings Bank. Davenport American Commercial & Sav Kellerton Kellerton State Bank. ings Bank. Knoxville Guarantee State Bank. Digitized for FRASER i Approved in 1917; capital and reserve paid in 1918. http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTEIGT NO. 1—CHICAGO. 569 SCHEDULE 9.—Additions to State bank membership in the Federal Reserve Bank of Chicago in 1918—Continued. IO W A—Continued. Leon Farmers & Traders State Bank. Perry Peoples Trust & Savings Bank. Lockridge Lockridge Savings Bank. Remsen Farmers Savings Bank. Logan State Savings Bank. Royal Home State Bank. Lowden Lowden Savings Bank. Riceville Riceville State Bank. Malcom Malcom Savings Bank. Roland Farmers Savings Bank. Mapleton Mapleton Trust & Savings Sac City Farmers Savings Bank. Bank. Sac County State Bank. Marshalltown Marshalltown State Bank. Sioux Center Sioux Center State Bank. Mediapolis Commercial State Bank. Sutherland First Savings Bank. * Missouri Valley State Savings Bank. Terrill Terrill Savings Bank. Mondamin Mondamin Savings Bank. Thompson State Bank of Thompson. Montieello Lovell State Bank. Tipton Farmers & Merchants Savings Monticello State Bank. Bank. Mount Ayr ... .Mount Ayr State Bank. Ute Iowa State Savings Bank. New Hampton. ...State Bank of New Hampton. Vail Farmers State Bank.2 Newton Citizens State Bank. Wapello Wapello State Savings Bank. Jasper County Savings Bank. Waterloo Waterloo Bank & Trust Co. Ogden City State Bank. Osage The Home Trust & Savings Bank. MICHIGAN. Adrian Adrian State Savings Bank. Hudson Thompson Savings Bank. Commercial Savings Bank. Imlay City Lapeer County Bank. Lenawee County Savings Bank. Peoples State Bank. Albion Albion State Bank. Ionia State Savings Bank. Alpena Alpena County Savings Bank. Jackson Jackson State Savings Bank. Ann Arbor Farmers & Mechanics Bank. Jonesville Grosvenor Savings Bank. State Savings Bank. Lakeview Commercial State Savings Bank. Armada Farmers State Bank. Farmers & Merchants State Bay City Bay City Bank. Bank. Farmers State Savings Bank. Lansing Lansing State Savings Bank. 2 Peoples Commercial & Savings Lowell City State Bank. Bank. Ludington Ludington State Bank. Benton Harbor Benton Harbor State Bank. Manchester The Peoples Bank. Big Rapids Big Rapids Savings Bank. The Union Savings Bank. Citizens State Bank. Manistee Manistee County Savings Bank. Carson City Farmers & Merchants State Marcellus G. W. Jones Exchange Bank. Bank. Marshall .Commercial Savings Bank. Cassopolis Cass County State Bank. Milan Milan State Savings Bank. Chelsea Farmers & Merchants Bank. Milford First State Bank. Coloma. State Bank of Coloma. Morenci Wakefield State Bank. Coopersville Peoples Savings Bank. Mount Clemens The Ullrich Savings Bank. Davison Davison State Bank. Mount Pleasant.. .Isabella County State Bank. Dearborn Dearborn State Bank. Nashville Farmers & Merchants Bank. Detroit Bank of Detroit. Ousted Onsted State Bank. The United Savings Bank of Otsego Citizens State Savings Bank. Detroit. PawTaw Paw Paw Savings Bank. American State Bank.2 Petoskey First State Bank of Petoskey. Peninsular State Bank.2 Pontiac. Pontiac Savings Bank. Edmore Edmore State Bank. American Savings Bank. • Elk Rapids Elk Rapids State Bank. Red ford Redford State Savings Bank. Farmington Farmington State Savings Bank Rochester Rochester Savings Bank.2 Fenton Commercial Savings Bank. Rogers City Prescme Isle County Savings Fenton State Savings Bank. Bank. Flint G enesee County Savings Bank. Royal Oak........ First Commercial State Bank. Flushing Peoples State Bank. Royal Oak Savings Bank. Frankenmuth Frankenmuth State Bank. St. Clair .Commercial & Savings Bank.3 Fremont Fremont State Bank. Saginaw Bank of Saginaw. Old State Bank.2 Saline Saline Savings Bank. Grand Haven Peoples Savings Bank. South Haven Citizens State Bank. Grand Rapids City Trust & Savings Bank. Suttons Bay Leelanau County Savings Bank. Commercial Savings Bank. Tecumseh .*. Lilley State Bank. Greenville Commercial State Savings Bank Tecumseh State Savings Bank. Hart Oceana County Savings Bank.2 Traverse City Traverse City State Bank. Hillsdale Hillsdale Savings Bank. Warren State Savings Bank of Warren. Holland First State Bank. Washington Washington Savings Bank. Holland City State Bank. Williamston Williamston State Bank. WISCONSIN. Baraboo Bank of Baraboo. Platteville State Bank of Platteville. Burlington Bank of Burlington. Plymouth Plymouth Exchange Bank. Green Lake Green Lake State Bank. State Bank of Plymouth. Kenosha Merchants & Savings Bank. Sheboygan Bank of Sheboygan. Milwaukee Second Ward Savings Bank. Citizens State Bank. American Exchange Bank.2 Sturgeon Bay Bank of Sturgeon Bay. Mineral Point Iowa County Bank. Waupun State Bank of Waupun. Mosinee State Bank of Mosinee. Wausau Marathon County Bank. Oakfield Bank of Oakfield. Winneconne The Union Bank of Winneconne. 1 Approved in 1917; reserve paid in 1918. 2 Approved in 1917; capital and reserve paid in 1918. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

570 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. SCHEDULE 10.—Member banks authorized and approved in 1918 to exercise fiduciary powers. Bank. Location. Bank. Location. First National Bank Dana, Ind. First National Exchange Port Huron, Mich. Farmers' National Bank Edinburg, Ind. Bank. Citizens' National Bank Royal, Iowa. First National Bank , New Castle, Ind. National Bank of Decatur... Decatur, 111. Do New Carlisle, Ind. First National Bank Everly, Iowa. Do , Marshalltown, Iowa. Do Chillicothe 111. Do Hillsdale, Mich. Commercial National Bank. Appleton, Wis. Do Dublin, Ind. First National Bank Kewanee, 111. German-American National Arlington, Iowa. Union National Bank Macomb, 111. Bank. First National Bank Monticello, 111. First National Bank of Chicago, 111. Commercial National Bank. Fond du Lac, Wis. Englewood. First National Bank Cherokee, Iowa. City National Bank Kankakee. 111. Citizens' National Bank Appleton, Wis. La Salle National Bank La Salle, 111. Home National Bank Thornton, Ind. First National Bank Winamac, Ind. SCHEDULE 11.—Certificates of indebtedness. ANTICIPATING THIRD LIBERTY LOAN. Date of issue. Total issue. Chi A c l a l g o o t t d ed is t t o ri ct. i R nt a e t r e e o s f t. m D at a u te r i o t f y . sc S ri u b b e rs. Per cent. Jan. 22,1918 $400,000,000 $30,359,000 4 Apr. 22,1918 910 Feb. 8, 1918 500,000,000 42,352,000 4 May 9,1918 2,193 Feb. 27,1918 500,000,000 59,168,000 4i May 28,1918 2,856 Mar. 20, 1918 543,032,000 64,414,000 4£ June 18,1918 3,115 Apr. 10,1918 551,226,500 65,850,000 4£ July 9,1918 2,662 Apr. 22,1918 517,026,000 63,212,000 • 4J July 18,1918 2,056 Total 3,011,284,500 325,355,000 " " * " 1 ANTICIPATING TAXES, 1918. Nov. 30, 1917 $691,872,000 $30,139,500 4 June 25,1918 89 Jan. 2, 1918 491,822,500 48,054,500 4 do 230 Feb. 15, 1918 74,100,000 15,709,000 4 do 238 Mar. 15,1918 110,962,000 13,286,500 4 do 183 Apr. 15, 1918 71,880,000 15,742,000 4 do 155 May 15,1918 183,767,000 40,002,500 4 do 155 Total 1,624,403,500 162,934,000 ANTICIPATING FOURTH LIBERTY LOAN. June 25, 1918. $838,553,500 $131,481,500 Oct. 24,1918 4,084 July 9, 1918.. 759,438,000 101>203,000 Nov. 7,1918 4,258 July 23, 1918. 584,750,500 83,310,500 Nov. 21,1918 4,240 Aug. 6, 1918., 575,706,500 87,292,500 Dec. 5,1918 4,187 Sept. 3, 1918. 639,493,000 88,279,000 Jan. 2,1919 3,904 Sept. 17, 1918 625,216,500 88,878,500 Jan. 16,1919 3,858 Oct. 1,1918.. 641,069,000 82,759,000 Jan. 30,1919 3,641 Total... 4,664,227,000 663,204,000 ANTICIPATING TAXES, 1919. Aug. 20, 1918 $157,550,500 $22,003,000 4 July 15,1919 363 Nov. 7, 1918 794,172,500 103,828,000 4* Mar. 15,1919 1,082 Total 951,723,000 125,831,000 ANTICIPATING FIFTH LIBERTY LOAN. Dec. 5. 1918 $613,438,000 $97,235,500 4* May 6,1919 3,795 Dec. 19, 1918 572,494,000 83,189,500 4i May 20,1919 3,656 Total 1,185,932,000 180,425,000 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 1—CHICAGO. 571 SCHEDULE 12.—Depositary bank division statistics. SECOND LIBERTY LOAN. Amount paid by credit war Payment dates. loan deposit account. Nov. 15, 1917. $96,081,844 Dec. 15, 1917.. 74,541,061 Jan. 15, 1918.. 43,212,229 Total... 213,835,134 Number of depositary banks, 288. CERTIFICATES OF INDEBTEDNESS. [Issued in anticipation of third Liberty lqan.l Jan. 22,1918.. $17,899,126 Feb. 8,1918.. 23,516,276 Feb. 27,1918. 36,224,616 Mar. 20,1918. 39,114,281 Apr. 10, 1918. 44,461,836 Apr. 22,1918. 39,138,754 Total 200,354,889 Number of depositary banks, 375, Feb. 8; and 580, Apr. 10. CERTIFICATES OF INDEBTEDNESS. [Issued in anticipation of taxes.] Due June 25,1918. $97,324,184 Due July 15, 1919.. 14, 736,162 Due Mar. 15,1919. 65,363,052 Total 177,423,398 THIRD LIBERTY LOAN. Amount paid Payment dates. by credit war loan deposit account. May 9, 1918... $114,306,519 May 28, 1918.. 37,635,209 July 18, 1918.. 44,111,982 Aug. 15, 1918. 33,591,970 Total... 229,645,680 Number of depositary banks, 603. CERTIFICATES OF INDEBTEDNESS. [Issued in anticipation of fourth Liberty loan.] June 25,1918 $73,205,054 July 9, 1918 65,193,195 July 23, 1918 54,546,570 Aug. 6,1918 60, 621> 087 Sept. 3, 1918 60,338,177 Sept. 17, 1918 62,256,957 Oct. 1,1918 55,503,385 Total 431,664,425 Number of depositary banks, 721. REDEPOSIT OF INCOME AND EXCESS-PROFITS TAXES. June25,1918 $96,494,624 Number of depositary banks participating, 225. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

572 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. SCHEDULE 12.—Depositary bank division statistics—Continued. FOURTH LIBERTY LOAN PAYMENTS. Oct. 24,1918 $174,631,079 Nov. 21,1918 71,188,268 Total 245,819,347 ANTICIPATION OF FIFTH LIBERTY LOAN. Dec. 5, 1918 $65,597,671 Number of depositary banks, 1,060. COLLATERAL HELD BY CUSTODIANS. Jan. 1,1918 $139,133,633 Apr. 14, 1918.... 149,496,020 July 1,1918 237,165,171 Dec. 15,1918 177,980,779 SCHEDULE 13.—Classification of Liberty loan subscriptions in 1918. Third Liberty Fourth Liberty loan classifica loan classifica tion. tion. Illinois: $96,394,350 $131,915,650 State banks and. trust companies 138,886,050 274, 777,500 10,977,450 16,565,800 Total 246,257,850 423,258,950 Indiana: 33,391,400 54,524,350 32,926,050 54,025,100 4,413,400 7,107,850 Total 70, 730,850 115,657,300 Iowa: 33,330,650 50,164,800 69,869,650 94,483,300 13,959,750 13,199,450 Total 117,160,050 157,847,550 Michigan: 28,470,900 50,812,100 State banks and trust companies 65,338,850 107,454,400 Private banks 4,154,400 5,946,550 Total 97,964,150 164,213,050 Wisconsin: National banks 35,082,050 51,488,700 State banks and trust companies • 39,858,450 55,404,450 Total 74, 940,500 106, 893,150 1,825,200 1,339,000 Grand total 608,878,600 969., 209,000 SCHEDULE 14.—Statistics in connection iviih third Liberty loan. Group. Subscriptions ranging from- s N ub u s m c b ri e b r e o rs f . Amount. One.... $50 to $10,000 3,476, 765 $468,469,950 Two... $10,050 to $50,000... 2,061 56,378,000 Three.. $50,050 to $100,000.. 295 26, 719,150 Four... $100,050 to $200,000. 102 16,154,600 Five... $200,050 and up 92 41,156,900 Total. 3,479,315 608,8 i,600 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT ^0. 7—CHICAGO. 573 SCHEDULE 14.—Statistics in connection with third Liberty loan—Continued. State. su Q bs u c o r t i a b e o r f s . N s u u t b m io s b c n e r s i r . p o f sub Q sc u r o i t p a t o io f ns. Subscriptions. s P c o e r f r i p s c t u i e b o n n t s to quota. Cook County, 111 571,686 892,190 $126,180,000 $167,503,050 132.62 Outside Cook County 423, 791 525,051 52,800,000 80,123,350 151.74 Total, Illinois 995,477 1,417,241 178,980,000 247,626,400 138.70 Indiana 445,468 404,191 53,770,000 70,822,450 131.71 Iowa 444,954 660,942 71,050,000 117,211,450 164.97 Michigan 544,346 569,570 75,600,000 98,033,050 130.07 Wisconsin 400,589 427,371 45,600,000 75,185,250 164.88 2,830,834 3,479,315 425,000,000 608,878,^00 143.23 Denomination. Nu p m ie b ce e s r . of Amount. $50 2,405,310 $120,265,500 $100 1,402,127 140,212,700 $500 148,771 74,385,500 $1,000 143,474 143,474,000 $5,000 5,839 29.195,000 $10,000 3,498 34; 980,000 4,109,019 1 542,512, 700 1 The difference between this figure and the total subscriptions is represented by registered bonds. SCHEDULE lb.—Statistics in connection with fourth Liberty loan. Number of Group. Subscriptions ranging from - subscribers. Amount. One... $50 to $10,000 4,292,990 $720,786,300 Two... $10,050 to $50,000... 6,420 106,008,700 Three.. $50,050 to $100,000.. 576 42,172,700 Four.. $100,050 to $200,000. 144 20,791,200 Five... $200,050 and up 182 79,450,100 Total. 4,300,312 969,209,000 Number of Per cent State. su t b io sc n r s i . p sub Q sc u r o i t p a t o io f ns. Subscriptions. sc o r f i p s t u i b o ns to quota. Cook County, 111 $252,300,000 $298,739,350 118.40 Outside Cook County 113,100,000 124,255,300 109. 86 Total, Illinois 1,866,064 365,400,000 422,994,650 115. 76 Indiana 588,194 108,750,000 116,081,100 106. 74 Iowa 587,773 147,900,000 158,155,400 106. 93 821,799 147,900,000 164,784,200 111.41 436,482 100,050,000 107,193,650 107.14 Total 4,300,312 870,000,000 969,209,000 111.40 ESTIMATE OF COUPON BONDS REQUIRED. Number of Denomination. pieces. Amount. Fifty dollars 3,195,298 $159,764,900 One hundred dollars 2,026,986 202,698,600 Five hundred dollars . 229,707 114,853,500 One thousand dollars 224,382 224,382,000 Five thousand dollars 10, $37 53,185,000 6,433 64,330,000 Total 5,693,443 1 819,214,000 1 The difference between this figure and the total subscriptions is represented by registered bonds. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

574 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. SCHEDULE 16.—Total amount and number of subscribers to the fourth Liberty loan in cities with population of 25,000 and over. ILLINOIS. Number of City. Population. subscrip tions. Aurora 34,204 10,199 Bloomington. 27,258 6,591 Chicago 12,497,722 1,000,711 Danville 32,261 6,611 Decatur 39,631 8,829 Elgin 28,203 7,553 Evanston 28,591 12,896 Joliet ." 38,010 18,127 Moline 27,451 16,704 Oak Park 26,654 9,395 Peoria 71,458 31,228 Rockford 55,185 19,325 Rock Island.. 28,926 13,616 Springfield... 61,120 13,408 Total. 1,175,193 INDIANA. East Chicago. 28,743 13,073 Fort Wayne.. 76,183 33,650 Gary 65,000 28,882 Hammond 26,171 12,582 Indianapolis.. 271,708 94,368 Muncie 35,085 10,979 South Bend.. 68,946 20,092 Terre Haute.. 66,083 18,951 Total... 232,577 IOWA. Burlington 25,030 5,451 Cedar Rapids.. 37,308 19,137 Clinton 27,386 3,890 Council Bluffs. 31,484 5,528 Davenport 48,811 23,307 Des Moines 101,598 22,321 Dubuque 39,873 10,063 Sioux City 57,078 16,057 Waterloo 35,559 9,789 Total. 115,543 MICHIGAN. Battle Creek 29,480 12,488 Bay City 47,942 12,930 Detroit 571,784 209,632 Flint 80,000 34,955 Grand Rapids.. 128,291 47,913 Hamtramck 25,000 3,737 Highland Park. 25,000 7,023 Jackson 35,363 18,729 Kalamazoo 48,886 11,989 Lansing 40,498 15,390 Muskegon 26,100 15,306 Saginaw 55,642 15,310 Total. 405,402 i School census, Chicago. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 1—CHICAGO. 575 SCHEDULE 16.— Total amount and number of subscribers to the fourth Liberty loan in cities with population of 25,000 and over—Continued. WISCONSIN. Number of City. Population. su t b i s o c n r s i . p su A b m sc o ri u p n t t i o o n f s. Green Bay 29,353 9,146 $1,672,550 Kenosha 31,576 15,094 3,446,550 Madison 30,699 13,780 3,168,200 Milwaukee 436,535 69,047 34,139,950 Oshkosh „ 36,065 7,008 2,088,200 Racine 46,486 19,514 3,663,800 Sheboygan 28,559 7,151 1,635,950 Total 140,740 49,815,200 SCHEDULE 17.—Seventh Federal Reserve Liberty Loan Organization. EXECUTIVE COMMITTEE. Chairman, F. O. Wetmore, Chicago. Vice chairman, C. H. Schweppe, Chicago. Secretary, Eugene M. Stevens, Chicago. H. L. Stuart, Chicago. J. B. McDougal, governor, Federal Reserve Bank, Chicago. W. A. Heath, chairman, Federal Reserve Bank, Chicago. John E. Blunt, jr., Chicago. Howard W. Fenton, Chicago. W. M. L. Fiske, Chicago. Miss Grace Dixon, Chicago. Arthur W. Reynolds, Chicago. Wat kin W. Kneath, Chicago. Solomon A. Smith, Chicago. John Jay Abbott, Chicago. M. A. Traylor, Chicago. E. K. Boisot, Chicago. O. T. Reeves, Chicago. Frank O. Lowden, governor of Illinois, Springfield, 111. F. W. Merrick, commissioner of banking, Lansing, Mich, Ashton Clemens, Des Moines, Iowa. Henry W. Bennett, Indianapolis, Ind. Fred Vogel, jr., Milwaukee, Wis. George Woodruff, Joliet, 111. CAMPAIGN COMMITTEE. Director of campaign, C. H. Schweppe. Assistant director of campaign, James L. Martin. Secretary and treasurer, Frederick Merritt. Director of publicity, B. F. McCutcheon. Director of speakers' bureau, Henry P. Chandler. Director for women, Miss Grace Dixon. Director of foreign language division, F.J. Streyckmans. Director of sales for Chicago and Cook County, Charles W. Folds. Director of sales for Illinois, Heman Gifford. Director of sales for Indiana, Will H. Wade. Director of sales for Iowa, C. H. McNider. Director of sales for Michigan, F. R. Fenton. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

576 ANNUAL, REPORT OF THE FEDERAL RESERVE BOARD. Director of sales for Wisconsin, E. J. Kearney. Chairman finance committeee, Howard W. Fenton. Chairman bank committee, John E. Blunt, jr. Ex-officio, J. B. McDougal, governor Federal Reserve Bank of Chicago. WOMEN'S ORGANIZATION. Chairman for women, Miss Grace Dixon, Chicago. Chairman women's committee for Chicago and Cook County, Mrs. Bertha D. Baur. Chicago. Chairman women's committee for Illinois, Mrs. Howard T. Willson, Springfield, Chairman women's committee for Indiana, Mrs. F. H. McCulloch, Fort Wayne, Chairman women's committee for Iowa, Mrs. Wilbur W. Marsh, Waterloo, Chairman women's committee for Michigan, Mrs. D. I). Ashbaugh, Detroit, Chairman women's committee for Wisconsin, Mrs. John W. Mariner, Milwaukee. SCHEDULE 18.—District committee on capital issues. Chairman, W. A. Heath, Chicago. Executive Committee—Continued. Vice-chairman, J. B. McDougal, Chicago. B. A. Eckhart, Chicago. Executive committee: Louis A. Ferguson, Chicago. Rufus C. Dawes, Chicago. S. A. Fletcher, Indianapolis. E. D. Hulbert, Chicago. Oliver C. Fuller, Milwaukee. Joy Morton, Chicago. Chauncey Keep, Chicago. James Simpson, Chicago. John J. Mitchell, Chicago. Frank 0. Wetmore, Chicago. John J. O'Brien, Chicago. Secretary, Lyman A. Walton. George M. Reynolds, Chicago. E. J. Buffington, Chicago. B. E. Sunny, Chicago. Simon Casady, Des Moines E. K. Boisot. Chicago. Emory W. Clark, Detroit. D. R. McLennan, Chicago. SCHEDULE 19.—Summary of the activities of the district committee on capital issues to Dec. SI, 1918. Num Applications- ber. Amount. 1. Passed on by Chicago committee only. i $5,126,1 Amount. Per cent. Approved $4,145,392 81.36 Disapproved 949,500 18.64 Total » 5,094,892 100.00 Number. Amount. 2. Considered by Chicago, but not acted on by "Washington for various reasons ' 11 $7,306,380 3. Acted on by both Chicago and Washington committees 369 475,076,435 2 482,382,815 Analyzing items 2 and 3, recommended by Chicago committee for- Amount. Per cent. Approval $391,246,633 85.03 Disapproval 68,860,400 14.97 Total 2 460,107,033 100.00 1 Discrepancy between these amounts accounted for by difference between face of application and amount passed on. 2 Discrepancy between these amounts accounted for by difference between face of application and amount passed on. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT N"0. 7—CHICAGO. 577 SCHEDULE 19.—Summary of the activities of the district committee on capital issues to Dec. SI, 1918—Continued. Num Applical ions- ber. Amount. Acted on by Washington without recommendation from Chicago. $22,017,500 Total 509,527,207 Classification of total: N b u e m r. Amount. c P e e n r t . 39 $42,638,650 8.35 334 420,446,852 82.51 Municipal 107 41,799,705 8.23 i Bank applications 36 4.632,000 .91 Total 516 509,527,207 100.00 This total is divided— Stocks $286,130,902 B onds 115,880,805 Notes 107,515,500 5. Acted on by Washington without reference to Chicago committee 24,814,700 6. Considered by Chicago committee as to personnel only—properties located in other districts 37,228,392 7. Not considered—applications cover amounts not considered at various times per rulings of Washington committee 2,343,525 8. Withdrawn or canceled 12,562,435 9. Not acted on by either Washington or Chicago committees 1,670,000 Total of all applications originating in Seventh Federal Reserve District.. 588,146,259 NOTE.—A great number of applications were modified or abandoned after conferences or correspondence with the officers of the district committee; therefore, the statement submitted does not completely reflect the work of the committee. No memorandum was kept of these consultations or the amounts involved, but much of the time of the chairman and the secretary was devoted to them. SCHEDULE 20.—Federal Reserve notes of the Federal Reserve Bank of Chicago received from other Federal Reserve Banks for redemption or credit, and notes of other Federal Reserve Banks returned by the Federal Reserve Bank of Chicago for redemption or credit. Received. Returned. 1914-15 1916 1917 1918 1914-15 1916 1917 1918 $22,925 $24,000 $347,800 $2,247,800 $7,400 ' $96,500 $218,500 $1,209,500 New York 77, 955 140,410 1,760,420 14,071,550 212,200 1,615,500 3,425,000 10,923,000 Philadelphia... 11,995 16,970 406,000 3,237,500 11,540 124,000 357,500 1,931,500 2,000 17,190 420,040 3,294,050 51,280 572,000 939,500 6,654,000 265 2,600 128,610 2,765,850 54,735 328,000 332,000 1,553,000 1,870 8,795 224,550 2,493,075 66,925 603,000 747,500 2,013,000 41,040 49,950 1,050,350 12,486,965 38,155 545,500 1,205,000 5,146,000 Minneapolis 5,970 53,380 219,500 4,261,800 252,795 2,286,500 3,418,000 7,347,000 Kansas City— 950 2,895 142,150 1,285,100 192,770 1,496,500 2,776,500 8,578,500 Dallas 1,065 4,795 128,835 1,722,150 148,680 930,500 974,000 1,816,000 San Francisco.. 8,900 9,380 301,010 1,842,315 40,895 391,500 875,000 4,285,100 Total 174,935 330,365- 5,129,265 49,708,155 1,077,375 8,989,500 15,268,500 51,456,600 SCHEDULE 21.—Federal Reserve Bank notes, Dec. 81, 1918. Denominations. Total. SI $2 $5 $10 $20 Total notes received from Comp- $7,884,000 $2,096,000 $5,300,000 $2,623,760 $865,600 $18,769,360 Total notes returned to Comptroller of the Currency for destruction 57,450 7,800 124,650 47,560 6,100 243,560 Total notes in circulation and on the hand 7,826,550 2,088,200 5,175,350 2,576,200 859,500 18,525,800 100823°—19- -37 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

578 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. SCHEDULE 22.—Federal Reserve notes. Notes Notes issued to Notes re Notes outstanding bank during deemed during outstanding Dec. 31, 1917. 1918. 1918. Dec. 31,1918. Fives $19,145,050 $59,480,000 $9,174,290 $69,450,760 Tens 68,439,270 89,840,000 17,591,020 140,688,250 Twenties 81,072,760 124,320,000 13,847,260 191,545,500 Fifties 11,378,350 19,400,000 2,340,950 28,437,400 Hundreds 10,753,100 10,400,000 337,000 20,816,100 Total 190,788,530 303,440,000 43,290,520 450,938,010 SCHEDULE 23.— Transfers bought and sold 1918. Bought by Bought by Sold by Sold by draft. wire. draft. wire. January $254,181,000 $53,635,000 $5,000,000 February.. 257,840,000 62,425,000 4,000,000 March 255,355,000 65,270,000 6,100,000 April 253,656,000 $23,000,000 43,850,000 3, 750,000 May 157,233,000 10,220,000 43,040,000 June 189,610,000 85,690,000 29,933,000 12,850,000 July 208,120.000 84,275,000 22,590,000 12,665,000 August 76,967,000 205,215,000 13,655,000 12,035,000 September. 59,244,000 164,677,000 12,065,000 11,690,000 October 76,395,000 202,096,000 7,635,000 22,134,000 November. 47,989,000 200,671,000 10,765,000 5,401,000 December.. 53,049,000 323,119,000 12,806,000 25,035,000 Total 1,889,639,000 1,298,963,000 377,669,000 120,660,000 SCHEDULE 24.—Operation of the Federal Reserve clearing system; daily average number of checks handled monthly and during the calendar year 1918. Items drawn on d b F r a I a e t n w d e k n e m s r s a o i n l n Amount. b s d o a e i u n v s t k t e s r s i n i d c t i e h t n Amount. d b r a I o a t n t e w k h m s n e r s i o n n Amount. Reserve Federal districts. city. Reserve city. January 7,072 $17,596,000 17,663 $3,748,000 1,549 $605,000 February 8,638 17,816,000 20,147 4,290,000 2,714 665,000 March 9,113 20,802,000 23,343 5,977,000 1,911 1,233,000 April 9,119 21,600,000 23,954 5,416,000 2,099 776,000 May 8,540 22,463,000 23,988 6,095,000 2,167 750,000 June 9,158 23,540,000 28,215 7,823,000 2,854 812,000 July 9,961 22,696,000 39,203 8, 435,000 4,446 1,038,000 August 9,623 20,339,000 40, 898 8, 891,000 4,086 1,090,000 September 10,475 23,645,000 46,284 10, 610, 000 4,811 1,150,000 October 13, 318 27,458,000 48,163 11,350,000 5,300 1,244,000 November 12,990 25,553,000 49,914 8,800,000 5,610 1,278,000 December 14,102 26,424,000 50,570 7,520,000 5,606 1,070,000 Daily average, 1918 10,176 22,494,000 34,362 7,413,000 3,596 976,000 Total, 1918 3,047,109 6,748,151,000 10,289,902 2,225,581,000 1,073,410 292,992,000 Total, 1917 1,807,728 3,985,878,000 4,362,436 987,821,000 511,438 187,450,000 Total, 1916 950,596 1,549,148,000 2,722,827 616,111.000 778,959 873,758,000 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 7 CHICAGO. 579 SCHEDULE 24.—Operation of the Federal Reserve clearing system; daily average number of checks handled monthly and during the calendar year 1918—Continued. Total, e d x U o S r T f c a u t n r l a w e i r u i t t e t a n s e e r e s i m s d v o . e n Amount. h b b p y I a b r a t a n a a e r n b d n n e m d o l k c n s e t h t h d . Amount. d T r U r S I a e t t n w a a e i s t n m t e u e s s r d o . e n r Amount. i N b m n tr a b b u e i d n e e c m m i r r k t s . s b o m N n l a b i e o n s e p m n t r k . a - s r January 26,284 $21,949,000 5,896 $1,987,000 1,109 2,235 February 31,499 22,771,000 6,412 1,678,000 1,128 2,229 March 34,366 28,012,000 784 $575,000 5,257 2,041,000 1,137 2,223 April 35,173 27,792,000 164 315,000 7,523 2,301,000 1,151 2,260 Mav 34.694 29,310,000 179 422,000 7,840 2,874,000 1,156 2,284 June. 40.227 32,175,000 485 1,525,000 7,782 3,669,000 1,164 2,278 July 53,610 32,169, 000 280 306,000 9, 616 4,109,000 1,174 2,296 August 54,608 30,319,000 249 259,000 8,367 4,463,000 1,192 2,344 September 61,570 35,405,000 269 215,000 12, 269 5,164,000 1,253 2,409 October 66, 781 40,052,000 362 356,000 14, 034 5,514,000 1,285 2,337 November 68,514 35,632,000 335 242,000 11,486 5,848,000 1,321 2,274 December 70, 279 35,014,000 325 233,000 15,879 5,546,000 1,326 2,383 Daily average, 1918. 48,134 30,883,000 286 370,000 9,363 3,766,000 Total, 1918.... 14, 410,421 9, 266, 724,000 76,476 105,000,000 2,801,637 1,128,269,000 i, 332 2,392 Total, 1917.... 6,681,602 5,161.149,000 850,764 202,461,000 1,103 2,240 Total, 1916 4,452.382 3,039,017', 000 713,003 74,740,000 992 1,265 SCHEDULE 25.—Clearing operations, Detroit branch. Number. Drawn on banks located in Detroit: Mar. 18 to Apr. 15 24,700 Apr. 16 to May 15 28,054 May 16 to June 15 36,166 June 16 to July 15 52,806 July 16 to Aug. 15 50,700 Aug. 16 to Sept. 15 62,374 Sept. 16 to Oct. 15 63,232 Oct. 16 to Nov. 15 88,738 Nov. 16 to 30 40,508 Dec. 1 to 31 83,837 General average per month 55,906 Average daily number of items handled on Detroit: April 950 May 079 June ,391 July 031 August ,950 September 976 October 399 November 413 December ,117 Drawn on the Treasurer of the United States: Sept. 23 to Oct. 15 20,325 Oct. 16 to Nov. 15 25,896 Nov. 16 to 30 16,146 Dec. 1 to 31 39,394 General average per month 29,074 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

580 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. SCHEDULE 26.—Gold settlement fund operations, Jan. 1, 1918, to Dec. 31, 1918. Feder B al a n R k e . serve s s a F e e r f c r e e r t c A o t c v d o m l e e m e e u i r m v n o B a o e t l u e a s d t n n h n R t t d e k i e r n u s o e . f i A s n d F o e m u f r e e s v d o e a e t e u o t c r t n B c a l t o o e l a t u m n p R h n a k e e e t i r n s s d . t G se a t in t le t m hr e o n u t g s h . L s o e s t s t l t e h m r e o n u t g s h . Debits T . ransfer C s. r edits. $337,860,000 $249,539,000 $88,321,000 $7,000,000 $694,000 2,779,820,000 1,650,226,000 1,129,594,000 438,000,000 1,014,000,000 Philadelphia 385,846,000 861,268,000 24,578,000 6,000,000 13,000,000 621,410,000 850,809,000 $229,399,000 18,000,000 111,850,000 105,050,000 6,800,000 14,100,000 116,277,000 118,187,000 1,910,000 74,054,000 58,955,000 788,411,000 709,856,000 78,555,000 8,960,000 Minneapolis 465,234,000 582,292,000 117,058,000 6,000,000 Kansas City 462,114,000 766,350,000 304,236,000 22,000,000 4,000,000 115,333,000 95,588,000 19,745,000 9,671,000 23,500,000 219,806,000 265,103,000 45,297,000 5,000,000 Total 6,403,961,000 5,754,268,000 1,347,859,000 697,900,000 594,685,000 1,128,249,000 649,693,000 533,564,000 i 1 Gain through settlement.. . $649,693,000 Net loss through transfers. . 533,564,000 Net gain through transfers and settlement 116,129,000 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. • The gross earnings of the Federal Reserve Bank of St.Louis for the year 1918 amounted to $2,676,828.35, and the current expenses were $726,021.11, including the charging off of all furniture and fixtures amounting to $102,030.55. This left net earnings of $1,950,- 807.24, which wTas an increase of $1,448,651.20 over the net earnings for 1917. Out of the net earnings the bank paid dividends for the years 1917 and 1918, amounting to $404,837.60; set aside a reserve of $172,997 for depreciation in United States securities, and also a reserve of $801,655.61 for the franchise tax. The balance of $571,317.03 was transferred to surplus, together with the balance of $230,338.58 of undivided profits at the close of 1917, making $801,655.61 in that account on December 31, 1918. The principal source of revenue during 1918 was bills discounted for member banks. Of the $2,676,828.35 of gross earnings, $2,197,- 795.40 was derived from this source. During 1917 the earnings from bills discounted amounted to only $347,871.10. The percentage of earnings derived from each source during 1917 and 1918 is as follows: Per cent. Per cent. Bills discounted for other Federal Reserve Banks 1 1 Bills discounted and loans to member banks 47 82 Acceptances 23 9 Municipal warrants 2 Interest on United States securities 15 3 Transfers bought 8 2 Sundry 4 3 Total 100 Attached hereto as Schedule 1 is a comparative profit and loss statement, covering the years 1917 and 1918. The total resources of the Federal Reserve Bank of St. Louis increased from $159,619,896.96 on December 31, 1917, to $229,496,- 229.05 on December 31, 1918. Its earning assets increased from $45,066,896.64 to $85,717,141.81 within that time. The greatest 581 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

582 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. increase in the earning assets was the paper discounted for member banks, which amounted to $70,702,653.85 on December 31, 1918, as compared to $28,584,397.60 on December 31, 1917. The total cash reserve increased from $59,136,094 on December 31, 1917, to $89,256,994.89 on December 31, 1918. The reserve deposits of member banks also increased, due in great measure to the admission of State banks and trust companies into the System. Attached hereto as Schedule 2 are comparative balance sheets as of December 31, 1917 and 1918. GENERAL BUSINESS AND BANKING CONDITIONS. The beginning of 1918 found industries in this district busy, especially those contributing articles necessary for the prosecution of the war. This activity continued with increasing vigor until the termination of hostilities in November. The needs of the Govern ment received first consideration, and the production of nonessen tials gave way to those things necessary in carrying on the war. Many concerns worked almost exclusively on Government contracts. The signing of the armistice on November 11 resulted in the can cellation of many war contracts in this district, and business men have since been engaged in restoring their enterprises to a peace basis. It is believed that the resumption of normal demands, the production of those articles heretofore designated as nonessential, and the devel opment of foreign trade, will largely offset the suspension of war work. Business men as a rule are optimistic regarding the future, but are acting cautiously and buying only for their immediate needs, anticipating a readjustment of prices. Since the termination of the war, general business has been greatly helped by the lifting of Government restrictions, and many indus tries are preparing for increased activity. This is especially true of the building, construction, and engineering industries, whose activi ties were greatly curtailed during the war. The wholesale and retail trade has been good in this district, and merchants generally have enjoyed a prosperous year. Some lines of business were hampered by Government restrictions, while practically all suffered on account of the extraordinarily high prices and the scarcity of merchandise. Collections, as a rule, have been good, except in some of the southern portions of the district where cotton has moved slowly. Business has been greatly helped by the high wages paid to labor in the cities and the bountiful returns to the farmer during the past year. The crop of winter and spring wheat in this district was con siderably larger than that of last year, and also larger than the average for the five years previous. The production of cotton also exceeded that of last year and the five year average. The corn crop Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT :NT0. 8—ST. LOUIS. 583 was a good deal below the record crop of 1917, but only slightly less than the average for the previous five years. The com in this district was greatly damaged during the summer by dry and excessive tem perature, accompanied by hot winds. Until the termination of the war, there was a strong demand for both skilled and unskilled workmen in the district. This demand brought about competition among employers, which resulted in a migratory tendency on the part of labor. However, this situation was helped by the work of the United States Employment Service Committee. The shortage of workmen was greatly relieved by the employment of women, who entered munition plants and filled many other places formerly occupied by men. Farmers also experienced difficulty in obtaining sufficient help, but many overcame the prob lem to a great extent by purchasing tractors and other labor-saving machinery. Toward the close of the year the supply of labor became more ample, due to the release of soldiers from the Army and the release of many employees who had been engaged in the manufacture of munitions, etc. The labor situation in this district was seriously affected by the influenza epidemic, which became severe about October, and did not let up until the close of the year. There were a number of strikes and threats to strike during the past year. However, these were settled, and outside of some labor demands which were being arbitrated, there were very few disturbances in this district at the close of the year. Much credit is due to the Federal mediators who assisted in settling the strikes that arose. During the past year, the demand for money has continued good in this district, and there has been little variance in the bank rate to customers. In the large cities it has remained at about 6 per cent and in the country districts somewhat higher. However, toward the close of the year an easier tone became apparent. The banks have liberally supported the Government in the flotation of the Liberty loans and certificates of indebtedness, and have also taken care of their commercial requirements. This has been accomplished without disturbance to the money market, due to the service rendered by the Federal Reserve Bank. The commercial paper business has been considerably below normal throughout the year. The rate was practically 6 per cent until December, when it ranged from 5J per cent to 6 per cent. Brokers have encouraged the issuance of short maturities, so they would be readily available for rediscount at the Federal Reserve Bank. An open market for bankers' acceptances is being gradually developed, which will be of benefit to business interests. As the year closes there is a conservative tone of optimism in business and financial circles in the district. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

584 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. DISCOUNT OPERATIONS. The total amount of paper discounted for member banks by the Federal Reserve Bank of St. Louis during the year 1918 was $1,085,- 137,254, exclusive of bankers' acceptances. Of this amount $303,- 792,122 was commercial, or single-name paper, $15,681,201 con sisted of trade acceptances, or two-name paper, and $765,663,931 consisted of member banks' 15-day collateral notes. Of the $303,- 792,122 of commercial paper discounted, $13,765,838 was secured by Liberty bonds and certificates of indebtedness, and of the $765,- 663,931 of member banks' collateral notes $764,216,431 was secured by such Government obligations. During the year 1917, the total paper discounted for member banks amounted to $181,117,651.14. Thus there was an increase of $904,019,603 in the amount of paper discounted by the Federal Reserve Bank of St. Louis during 1918 over the previous year. Of the 513 member banks, 278 different member banks rediscounted with this bank during 1918. The number for 1917 was 149, showing an increase of 129 in the number of different member banks accommodated. Attached hereto as Schedule 3 is a table showing the volume of the different classes of paper discounted by the Federal Reserve Bank of St. Louis and by each branch during each month of the year, and attached as Schedule 4 is a table showing the volume of paper accepted from each State during each month of the year, and the number of different banks in each State discounting during the year. Attached hereto as Exhibit A is a table and chart showing (1) paper secured by Liberty bonds and Treasury certificates; (2) other dis counted paper; (3) total discounts; (4) bills bought in open market; (5) total bills discounted and purchased; (6) ratio of paper secured by Government war obligations to total discounted and purchased bills; and (7) total earning assets, including United States securities. On December 5 the Federal Reserve Bank of St. Louis rediscounted $2,000,000 of paper for the Federal Reserve Bank of Philadelphia, and on December 11, it rediscounted $2,500,000 of paper for the Federal Reserve Bank of Dallas. On July 2 the Federal Reserve Bank of Boston rediscounted $5,000,006.91 of paper for the Federal Reserve Bank of St. Louis, and on July 9 the Federal Reserve Bank of Cleveland rediscounted $7,500,001.62 of paper for this bank. Only two changes were made in the discount rates of this bank throughout the year. These were on April 8, when practically all the rates were slightly raised, and on October 5, when a special rate of 4 per cent instead of 4£ per cent was established for paper maturing within 16 to 90 days secured by fourth Liberty bonds, provided such paper was taken by the member bank at a rate not in excess of the fourth Liberty loan coupon rate of 4| per cent. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 8—ST. LOUIS. 585 Schedule 5 shows the discount rates in effect at the opening and closing of the year and the changes made during the year. TRADE ACCEPTANCES. During 1918 this bank discounted a total of $15,681,201 of trade acceptances for member banks, which is an increase of $12,566,695 over the amount for 1917. This bank has encouraged the use of trade acceptances and throughout the year has maintained a rate for them J to J per cent lower than the rate on commercial paper. That progress has been made is indicated by the large increase in the amount handled during the year. ACCEPTANCES. During the past year this bank purchased a total of $30,647,633.18 of bankers' acceptances, of which $26,096,119.64 were purchased from banks and dealers and $4,551,513.54 from the Federal Reserve Bank of New York. This is an increase of $915,361.39 over the amount purchased during 1917. The rates on these acceptances ranged from 3f per cent to 4f per cent. This bank has been endeavoring in every way possible to interest financial institutions in the district in the support of the open market, through the purchase of bankers' acceptances, and some progress has been made. To this end the bank has avoided as much as possible direct purchases of bills from accepting institutions, taking bills from only such institutions as found it impossible to sell their obligations in the open market. When the bills were purchased direct from the accepting banks, the commercial paper rate was charged instead of the acceptance rate. Recently this bank has adopted the policy of assisting local dealers in carrying the bills in their portfolios under a 15-day purchase and resale agreement. This enables them to carry the bills until they can be disposed of in the open market. Schedule 6 is a table showing the amount of bankers' acceptances purchased by this bank and each of its branches each month during 1918. During the past year the following member banks were authorized by the Federal Reserve Board to accept drafts and bills of exchange growing out of transactions involving the importation or exportation of goods up to 100 per cent of their capital and surplus, as provided in section 13 of the Federal Reserve Act: Name and location: Date authorized. Mercantile Trust Co., St Louis, Mo Mar 11,1918 Merchants' Laclede National Bank, St. Louis, Mo Mar. 18,1918 Third National Bank, St. Louis, Mo Oct. 10,1918 Mechanics-American National Bank, St. Louis, Mo Oct. 15,1918 National Bank of Commerce, St. Louis, Mo Oct. 15,1918 Union & Planters Bank & Trust Co., Memphis, Term Apr. 17,1918 Central State National Bank, Memphis, Term Oct. 22,1918 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

586 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. RESERVE POSITION. On December 31, 1917, the total reserve of this bank against all liabilities was 58.8 per cent, and on the same date this year the per centage was 54.5. The following table shows the reserve position of the Federal Reserve Bank of St. Louis at the close of each month during 1918: Outstanding 1918. Net deposits. Federal Reserve Total. Total reserves. Per cent. notes. Jan. 31.. $53,054, 367.43 $56,290, 945.00 $109,345,312.43 $70,506,434. 00 64.5 Feb. 28. 47,936, 349. 65 59,835,9 85.00 107,772,334.65 79,313,022.00 73.6 Mar. 31. 59,352, 279. 66 63,602, 780.00 122,955,059. 66 78,980,775.00 69.9 Apr. 30. 49,266, 153.51 61,464,4 60.00 110,730,613.51 57,763,379.00 52.2 May 31. 60,342, 801.32 64,716, 560.00 125,059,361.32 88,493,018.00 70.8 June 30. 60,052 695.42 65,899, 305.00 125,952,000.42 56,540, 668.19 44.9 July 31. 52,362; 046.97 73,809,3 10.00 126,171,356.97 65,018,672.36 51.5 Aug. 31. 47,578, 440.41 86,253, 825.00 133,832,265.41 82,102,360.06 61.3 Sept. 30 48,512. 713.09 100,114, 835.00 148,627,548.09 76,886,858.69 51.7 Oct. 31. 64,683: 433.36 107,606,4 85.00 172,289,918.36 84,903,230.00 49.3 Nov. 30. 55,309',1 69. 90 111,788,8 95.00 167,098,064.90 90,697,846.96 54.3 Dec. 31. 43,814, 815.54 120,037,0 40.00 163,851,855. 54 89,256,994.89 54.5 Attached hereto as Exhibit B is a table and chart showing (1) total cash reserves, (2) net deposit liability, (3) Federal Reserve notes in circulation, (4) net deposits plus Federal Reserve notes in actual circulation, and (5) ratio of total cash reserves to combined net deposit and Federal Reserve note liabilities. MOVEMENT OF MEMBERSHIP. On January 1, 1918, the Federal Reserve Bank of St. Louis had 478 member banks, and its authorized capital was $6,949,200, of which one-half, or $3,474,600, was paid in. Of the 478 members, 465 were national banks. During the year 11 national banks became members and 7 national banks surrendered their membership through liquidation. At the close of 1917, 9 State banks and 4 trust companies, making a total of 13 State institutions, were members of the Federal Reserve Bank of St. Louis. During 1918, 18 State banks and 13 trust com panies became members, making a total of 44 member State banks at the close of the year. On December 31, 1918, this bank had a total of 513 member banks, consisting of 469 national banks, 27 State banks, and 17 trust com panies, and its authorized capital was $7,599,200, of which $3,799,600 was paid in. This shows a net increase of 35 in the number of member banks, and a net increase in the paid-up capital stock of $325,000 over December 31, 1917. Attached hereto as Schedule 7 is a list of the State banks and trust companies admitted to membership during 1918, showing their capital and surplus, total resources, and date of admission. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 8—ST. LOUIS. 587 There are 959 eligible nonmember State banks and trust companies in this district, with total resources aggregating approximately $500,000,000. The total resources of the 44 State^banks and trust companies that are members of the Federal Reserve Bank of St. Louis amount to $347,683,000. Thus the State institutions that have become members represent almost 70 per cent of the total resources of all the eligible nonmember banks in the district. RELATIONS WITH NATIONAL BANK MEMBERS. During the past year more national banks in this district have availed themselves of the rediscount privilege and to a greater extent than during the previous year. Through the assistance rendered them by the Federal Reserve Bank during the past year, the banks have become more appreciative of the advantages offered by the reserve system and the strength given them by membership. They are more and more reducing their bills payable with their correspond ents and increasing their bills rediscounted with the Federal Reserve Bank. Nine national banks in this district were granted permission by the Federal Reserve Board during 1918 to act as trustee, executor, etc., under the provisions of section 11 (k) of the Federal Reserve Act. From the opening of the bank to the close of 1917, 29 national banks had been granted permission, making a total, of 38 national banks in this district authorized to exercise fiduciary powers. Of these banks, 3 are located in Arkansas, 9 in Illinois, 6 in Indiana, 10 in Kentucky, 1 in Mississippi, 8 in Missouri, and 1 in Tennessee. The amendment of September 26, 1918, to section 11 (k) of the Federal Reserve Act, empowering the Federal Reserve Board to authorize national banks, in addition to trustee, executor, adminis trator, and registrar of stocks and bonds, "to act as guardian of estates, assignee, receiver, committee of estates of lunatics, or in any other fiduciary capacity in which State banks, trust companies, or other corporations which come into competition with national banks are permitted to act, under the laws of the State in which the national bank is located," has resulted in a number of national banks in this district applying for these powers. Attached hereto as Schedule 8 is a list of the national banks granted permission during 1918 to exercise fiduciary powers. In the early part of April, 1918, the Federal Reserve Bank of St. Louis, as an added facility for member national banks, began to make deposits for them to their 5 per cent redemption accounts with the Treasurer of the United States in Washington, through the medium of the Federal Reserve Board and the gold-settlement fund. The table following shows the volume of such deposits. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

588 ANNUAL, REPORT OF THE FEDERAL RESERVE BOARD. Number Number Month. of Month. of Amount. deposits. deposits. April (18 to 30) 179 S315,095. 00 October 383 $756,204.90 May 598 1,105,320.00 November. 313 855,462. 50 June 551 1,042,112.50 December.. 275 774,390.00 July 521 950,092.50 August 443 834,059. 40 Total 3,031 7,424,446.80 September 368 791,110.00 RELATIONS WITH STATE BANKS AND TRUST COMPANIES. Activities in connection with subscriptions to the Liberty loans and the financing of such subscriptions have brought the State banks of this district into closer touch with .the Federal Reserve Bank. The member State banks have availed themselves freely of the discount privilege, and the amount of discounts accepted from them has steadily increased throughout the year. They have also taken advantage of the collection system and the other facilities offered by the Federal Reserve Bank. Of the $52,830,678.16 of reserve deposits of all member banks in the Federal Reserve Bank of St. Louis at the close of business December 31, 1918, the reserves of the 44 member State banks and trust companies amounted to $15,817,208.92. It has not been necessary to make a separate examination of any of the member State banks or those applying for membership during the past year. The various State banking departments have fully coop erated in furnishing duplicate copies of their reports of examinations of member State banks and of those applying for membership. How ever, toward the close of the year an arrangement was made with the Missouri State Banking Department at its request, to have the exam iner of the Federal Reserve Bank participate with the State ex aminer in examinations of member State banks in Missouri, and it is expected to make a similar arrangement with the banking depart ments of the other States in this district. FISCAL AGENCY OPERATIONS. As fiscal agent of the United States Government, during the past year the Federal Reserve Bank of St. Louis has continued to receive and disburse funds for its account. Acting in this capacity, it has also handled the sales of certificates of indebtedness, Liberty bonds, and war savings stamps in this district for the Treasury Department. It has also assisted in the work of the War Finance Corporation and the Capital Issues Committee. TREASURY CERTIFICATES OF INDEBTEDNESS. Certificates of indebtedness were issued in anticipation of the Liberty loans, and were used to a great extent in making payment Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 8—ST. LOUIS. 589 for the Liberty bonds. This obviated any disturbance which might have occurred if the payments had had to be made all at once in cash, In anticipation of the third Liberty loan, there were 6 offerings of certificates of indebtedness aggregating $2,900,000,000. The aggre gate quota assigned to this district amounted to $135,000,000, and the total subscriptions received aggregated $133,584,500. Of the 3,123 banking institutions in this district, 2,376, or 76.07 per cent, subscribed for these certificates. Schedule 9 is a statement showing the various issues of certificates of indebtedness prior to the third Liberty loan and also the subscrip tions received from the different classes of banking institutions in the district. In anticipation of the fourth Liberty loan there were seven offerings of certificates of indebtedness, aggregating $4,100,000,000. The aggre gate quota assigned to this district amounted to $164,000,000 and the total subscriptions received aggregated $186,963,000. Of the 3,093 banks in this district, 2,801, or 90.56 per cent, subscribed for these certificates. Attached hereto as Schedule 10 is a statement showing the various issues of certificates of indebtedness prior to the fourth Liberty loan and also the subscriptions received from the various classes of bank ing institutions in the district. In December there were also two offerings of certificates of indebt edness, aggregating $1,100,000,000, issued in anticipation of the fifth Liberty loan which is expected to be launched in the spring. The aggregate quota of these certificates for this district amounted to $44,000,000, and the total subscriptions received aggregated $45,551,000. Of the 3,093 banks in this district, only 1,757, or 56.8 per cent, subscribed for these certificates. Schedule 11 shows the two offerings of certificates of indebtedness issued in anticipation of the fifth Liberty loan and also the sub scriptions received from the different classes of banks in the dis trict. During the year seven offerings of tax certificates were also issued in anticipation of income and excess profits taxes due the Government. The first five issues were in anticipation of the taxes due June 15, 1918. The banks, corporations, and individuals in this district sub scribed to $18,870,000 of these issues. The last two issues were in anticipation of the taxes to be paid in 1919; $21,821,500 of these two issues were taken in this district. Attached hereto as Schedule 12 is a statement showing the various offerings of tax certificates issued during 1918 and the subscriptions to each received in this district. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

590 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. DEPOSITS OF TREASURY FUNDS WITH BANKS AND THEIR WITHDRAWAL. Such banks and trust companies, incorporated under the laws of the United States or any State, as made application through the Federal Reserve Bank of St. Louis, accompanied by acceptable collateral, were designated as depositaries of funds arising out of the sales of Treasury certificates of indebtedness and Liberty loan bonds in this district. Two hundred and ninety-eight banks qualified for deposits of the third loan and 120 banks for deposits of the fourth loan, which, with those which qualified prior to January, 1918, made a total of 537 Government depositaries at the end of the year. This bank had custody of all collateral offered as security for these deposits and performed all duties incident to the deposit and with drawal of funds, collection of interest, etc. It also handled the deposits and withdrawals of funds redeposited with qualified deposi taries accruing from the payment of income and excess profits taxes last June. The largest amount of collateral in its custody at any one time was on October 26, when the securities held by it totaled $102,616,000. The largest amount of deposits outstanding with depositaries at any one time was $87,000,000 on October 28. The total amount of deposits made with depositaries during the year amounted to $581,260,000, of which at close of business December 31 about $12,135,000 was still outstanding. The interest collected by the Federal Reserve Bank for account of the United States Govern ment on such deposits during the year amounted to about $700,000. FLOTATION OF LIBERTY LOANS. The campaign for the third Liberty loan opened on April 6. The amount was $3,000,000,000, and the quota assigned to this district was $130,000,000. This was the first district to meet its quota. The total subscriptions received amounted to $199,835,900, over subscribing the quota by $69,835,900. These subscriptions were allotted by the Treasury Department in full. The subscriptions were widely distributed, the number of subscribers being 1,185,709. Of the 3,066 banking institutions in this district 3,044, or 98.27 per cent, sent in subscriptions for themselves and their customers,. Of the $199,835,900 of subscriptions $56,290,303 was paid in cash, $54,124,000 in certificates of indebtedness, and $89,421,597 by credit on the books of the Federal Reserve Bank by banks authorized to act as Government depositaries. Attached hereto, as Schedule 13, is a table showing the quota, subscriptions, number of subscribers in each State, the subscriptions received from each class of banking institutions, and the methods of payment for subscriptions to the third Liberty loan. The fourth liberty loan was launched on September 28. Its amount was $6,000,000,000 and the quota assigned to this district Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 8—ST. LOUIS. 591 was $260,000,000. As in the case of the third Liberty loan, this was the first district to meet its quota. The total subscriptions received amounted to $295,329,750, oversubscribing the quota by $35,329,750. These subscriptions were also allotted in full. The number ol subscribers..MOB. 1,395,299,. _ Of the 3,087 banking institu tions in this district, 3,059, or 99.093 per cent, sent in subscriptions for themselves and their customers. Total payments amounting to $270,547,025 have been made on the $295,329,750 of subscriptions to the fourth Liberty loan, in the following manner: $54,313,997.64 in cash, $82,274,000 in certificates ot indebtedness, and $133,959,- 027.36 by credit on the books of the Federal Reserve Bank by banks authorized to act as Government depositaries. There is an unpaid balance of $24,782,725, not yet due, on $49,570,450 of subscriptions which are being paid on the Government plan. Attached hereto, as Schedule 14, is a table showing the quota, subscriptions, the number of subscribers in each State, the subscrip tions received from each class of banking institutions, and the methods of payment for subscriptions to the fourth Liberty loan. The campaign work in connection with both the third and fourth Liberty loans was conducted by the Libert}^ Loan Organization, under the supervision of the Federal Reserve Bank, as was done in the case of the first and second loans. Gov. Roll a Wells was chairman of this organization. However, the previous plans were somewhat changed. The central committee, of which Mr. William R. Compton was chairman, Mr. T. K. Smith, vice-chairman, and Mr. George O. Carpenter, jr., secretary, was the active administrative body. In addition to these gentlemen, the committee consisted of a chairman for each State and directors in charge of the various departments of the organization. With the exception of the secre tary, all the members of the central committee were volunteers and devoted practically their entire time to the work during the active campaigns. After the third Liberty loan, the Liberty Loan Organization also acted as sales agent in distributing the certificates of indebtedness, and rendered valuable assistance through its 86 district managers. Early in the year the organization moved to the sixteenth floor of the Railway Exchange Building and occupied the entire south west corner of that floor. These quarters were occupied until the close of the fourth Liberty loan, when the organization moved to the fifth and sixth floors of the building at 210 North Broadway, adjoining the Federal Reserve Bank Building. WAR-SAVINGS AND THRIFT STAMPS. An issue of war-savings stamps and thrift stamps, authorized by act of Congress approved September 24, 1917, was offered to the Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

592 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. people of the United States on December 3, 1917, through the banks, post-offices, and other agencies. The issue was dated January 1, 1918, and was for a period of five years. The Federal Reserve Bank has supplied the stamps to banks and other agencies. The war-savings campaign was handled originally by the Treasury Department in Washington through State directors, each director being responsible for one State. This plan was followed until September, 1918, when the Treasury Department placed the warsavings campaign under the supervision of the Federal Reserve Bank. From December, 1917, to December, 1918, inclusive, 6,102,613 war-savings stamps, of a maturity value of $30,513,065, and 2,210,693 thrift stamps, amounting to $552,673.25, were delivered through the Federal Reserve Bank of St. Louis. In addition, 212,048 filled thrift cards were exchanged for war-savings stamps, which were cancelled and shipped to Washington. There were 2,220 agents in this district, as follows: Arkansas, 330; Illinois, 195; Indiana, 109; Kentucky, 116; Mississippi, 166; Missouri, 1,204; Tennessee, 100. Eighteen thousand deliveries of stamps were made to these agents, being an average shipment of $1,418. Stamps were also shipped to agents on a consignment basis against a pledge of approved collateral. Securities aggregating $1,300,000 were on deposit with the Federal Reserve Bank covering such transactions. The following table shows the war-savings stamps delivered through the Federal Reserve Bank of St. Louis for each month since the campaign started: Number of Maturity Number of Maturity stamps. value. stamps. value. 1917 1918 December 221,779 $1,108,895 June 956,564 $4,782,820 July .,226,468 6,132,340 1918 August 634,181 3,170,905 September 488,122 2,440,610 January 590,730 2,953,650 October 364,113 1,820,565 February 296,396 1,481,980 November 317,478 1,587,390 March 292,230 1,461,150 December 312,287 1,561,435 April 217,785 1,088,925 May 184,480 922,400 Total... 6,102,613 30,513,065 The third and fourth Liberty loan drives are reflected in the warsavings campaign by periods of marked decreases in sales during May and November. An unusual period of activity occurred in January, 1918, occasioned by an intensive drive in St. Louis. During February March, April, and May the sales showed a gradual, but steady decline for each month, reaching in the month of May the lowest point of the campaign. As a result of the President's appeal of June 28, warsavings pledge cards were signed throughout this district causing a tremendous increase in the sales for Julv and August. The figures Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 8—ST. LOUIS. 593 show that almost one-third of the total sales for the year were made during these two months. After July, the sales again fell off, August, September, October, November and December each showing a de crease in the sales as compared with the preceding month, but at no time did they reach the low level of the first months of the campaign. WAR FINANCE CORPORATION. During the past year this bank has also acted as fiscal agent of the War Finance Corporation, which was created by an act of Congress approved April 5, 1918. Although the Federal Reserve Bank of St. Louis sent out circulars from time to time explaining the purposes and requirements of the War Finance Corporation, only one loan was made by it as fiscal agent of that corporation. This was to a national bank in this district and amounted to $75,000. However, several loans were obtained direct from the War Finance Corporation in Washing ton by public utility companies and others in the district, and this bank acted as custodian in holding the collateral pledged as security therefor. CAPITAL ISSUES COMMITTEE. On January 11, 1918, the Federal Reserve Board appointed a Capital Issues Committee to pass upon such applications as might be submitted to it in respect to capital expenditures or issues of new securities, the purpose being to discourage unnecessary undertakings, so as to release capital, labor, and materials for war purposes. This committee in turn appointed a subcommittee in each of the 12 Federal Reserve districts. Each subcommittee was at first divided into a permanent committee and an auxiliary committee. The per manent committee in this district consisted of Mr. Wm. McC. Martin, chairman, Mr. Rolla Wells, vice chairman, and Messrs. F. O. Watts, W. K. Bixby, and W. R. Compton, all of St. Louis. The auxiliary committee consisted of Messrs. N. A. McMillan, Breckinridge Jones, Walker Hill, Festus J. Wade, Wm. E. Guy, and Benj. Gratz, all of St. Louis, Mr. J. A. Omberg of Memphis, Tenn., Messrs. S. T. Ballard and Embry L. Swearingen, of Louisville, Ky., Mr. W. L. Hemingway, of Little Rock, Ark., and Mr. M. S. Sonntag, of Evansville, Ind. The Capital Issues Committee, by an act of Congress approved April 5, 1918, was created by law and its functions defined. Follow ing the passage of this act, in July, the permanent and auxiliary com mittees were merged into one, known as the /'District Committee on Capital Issues/' The personnel remained the same, the only change being that an executive committee from its number was appointed, consisting of Mr. Wm. McC. Martin, chairman, Mr. Rolla Wells, vicechairman, and Messrs. W. K. Bixby, W. R. Compton, Walker Hill, and F. O. Watts. In the beginning, Mr. C. M. Stewart, assistant 100823°—19 38 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

594 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD, Federal Reserve agent, acted as secretary of the local committee, but as the work progressed, it became too burdensome in connection with his other duties and Mr. L. A. Wilson was appointed July 11 to take his place. The members of the committee served without remuneration. Applications began coming in to the committee in February and the first formal meeting was heid on March 8, 1918. From that time to the close or the year it held a total of 46 meetings. During that time the committee considered and passed upon 283 applications of aU classes, involving a total of $92,418,031.10. 01 these 283 cases 143 involved more than $100,000 each and 140 involved $100,000 or less. Of the 143 major cases, 100 were approved wholly or in part, aggregat ing $60,325,527, and 43 cases disapproved wholly or in part, aggre gating $25,617,782. Of the 140 minor.cases, 110 were approved wholly or in part, aggregating $5,053,150, and 30 were disapproved wholly or in part, aggregating $1,421,572.10. Thus a total of 210 applications was approved, involving $65,378,677, and 73 cases dis approved, involving $27,039,354.10. In addition to the foregoing applications, about 140 unnecessary undertakings, involving approximately $40,000,000 were postponed in this district, after the necessities of the Government, through cor respondence and personal interviews, were brought to the attention of prospective applicants by members of the committee. These postponed issues which did not reach the stage of formal applications, together with the applications definitely disapproved by the com mittee, aggregated $67,039,354.10. These figures, of course, do not fully reflect the conservation in this district of capital, labor, and ma terials that was effected as a result of the disapproval or postponement of proposed issues; nor do they reflect the great moral effect and general restraining influence that the activities of the Capital Issues Committee has had on the general public. The work of the committee was most active during the months of August, September, October, and November, due no doubt to the fact that the law had become better known and understood. During those four months the committee held 25 meetings and passed upon 204 cases, or an average of more than 8 cases at each session. Under instructions from the Capital Issues Committee at Washington, the district committee suspended operations on December 31, 1918. FEDERAL RESERVE NOTES. During the past year, the Federal Reserve agent issued to the Federal Reserve Bank of St. Louis a total of $102,605,000 of Federal Reserve notes, which is an increase of $47,345,000 over the amount issued last year. The greatest demand for notes was during the months of July, August, September, and December. As was the case Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTEICT NO. 8 ST. LOUIS. 595 in 1917, considerably more notes of the $10 and $20 denominations were issued than of the other denominations. Attached hereto as Schedule 15 is a table showing the denomina tions and amounts of Federal Reserve notes issued by the Federal Reserve agent to the Federal Reserve Bank of St. Louis each month during the year and the totals from the opening of the bank on No vember 16, 1914, to December 31, 1918. On December 31, 1918, the total amount of Federal Reserve notes outstanding was $129,119,875. Of this amount, $66,673,935 was covered by gold deposited with the Federal Reserve agent and the balance of $62,445,940 by eligible paper hypothecated with him. This bank has continued to acquire gold from banks of the district in exchange for Federal Reserve notes. Both member and nonmember banks have cooperated in this, so that at the end of the year the greater part of the gold in the district was deposited in the Federal Reserve Bank. During 1918 the Federal Reserve Bank of St. Louis received from other Federal Reserve Banks for redemption or credit $15,019,535 of its own Federal Reserve notes and returned to other Federal Reserve Banks for redemption or credit $37,557,760 of their Federal Reserve notes. In other words, this bank returned $22,538,225 more notes of other banks than it received of its own. As was the case in 1916 and 1917, the Federal Reserve Banks of Chicago and New York returned to this bank during 1918 more of the notes of the Federal Reserve Bank of St. Louis than did any other districts. However, whereas during the years mentioned this bank returned more notes of the Kansas City and Dallas Federal Reserve Banks, during 1918 it returned more notes of the Chicago and Kansas City Federal Reserve Banks than of any other districts. Attached hereto as Schedule 16 is a table 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, 1918, to December 31, 1918. During 1918 the Treasurer of the United States redeemed out of the redemption fund maintained with him, by the Federal Reserve agent $20,843,555 of unfit notes of the Federal Reserve Bank of St. Louis, making a total of $29,270,125 redeemed from the opening of the bank to December 31, 1918, in the following denominations: Fives, $10,615,615; tens, $12,417,680; twenties, $5,943,280; fifties, $240,050, and hundreds, $53,500. These unfit notes were turned over to the Comptroller of the Currency for destruction. Out of the redemption fund maintained by the Federal Reserve Bank of St. Louis with the United States Treasurer, he redeemed $690,050 of fit Federal Reserve notes during 1918, making a total of Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

596 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. $2,456,750 from the opening of the bank to the close of 1918. These were returned to the bank for reissuance. In addition to the supply of Federal Reserve notes kept in Wash ington and in the vaults of the Federal Reserve agent, the amount maintained in the sub treasury at St. Louis has been greatly increased so that an adequate supply would be immediately available at all times. During the year the Federal Reserve agent received from the Comptroller of the Currency Federal Reserve notes aggregating $88,280,000, the majority being received during August, September, October, and December. Attached hereto as Schedule 17 is a table showing the amounts of Federal Reserve notes of the various denominations received by the Federal Reserve agent from the Comptroller of the Currency each month during 1918 and the totals from November 16, 1914, to December 31, 1918. There is also attached as Schedule 18 a summarized statement of the receipt and disposition of all Federal Reserve notes by the Fed eral Reserve agent from November 16, 1914, to December 31, 1918, as well as of all funds and securities in his possession. FEDERAL RESERVE BANK NOTES. During the year 1918 the Federal Reserve Bank of St. Louis received $6,472,000 of Federal Reserve bank notes in the following denominations: Ones, $3,232,000; twos, $1,000,000; fives, $1,240,000; tens, $1,000,000. The first shipment was received on September 13, 1918, and from then to the close of the year it issued $6,248,000 of Federal Reserve banknotes, of which $32,000 were redeemed. These Federal Reserve bank notes were secured by $6,568,000 of United States certificates of indebtedness, deposited with the Treasurer of the United States. POSITION OF COMMERCIAL BANKS AS A RESULT OF WAR FINANCING. In Federal Reserve District No. 8 a total of $710,804,500 was sold of all four issues of Liberty bonds. The total amount of certificates of indebtedness taken by this district in anticipation of all Liberty loans was $444,543,500, but of these certificates $353,454,000 have matured and been paid by the Government, leaving $91,089,500 out standing. Of this $91,089,500 of certificates, some were used in making payments on fourth Liberty bonds, so that the amount actually outstanding is less than $91,000,000. Assuming, however, that the amount is $91,000,000, this, added to the $710,804,500 of Liberty bonds, gives a total of approximately $800,000,000 of war obligations taken by this district and outstanding at the end of 1918. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT 1X0. 8 ST. LOUIS. 597 The banks in the five centers of this district, St.' Louis, Louisville, Memphis, Little Rock, and Evansville, at the close of 1918 held approximately $40,000,000 of Liberty bonds and approximately $35,000,000 of certificates of indebtedness, or an aggregate of $75,000,000 of war obligations. This would indicate that out of the $800,000,000 of war obligations taken and outstanding in this dis trict, a very large amount, probably five to seven hundred millions of dollars, was absorbed by the general public. Under the circum stances, this indicates a not unsatisfactory condition in this district. Of the total paper discounted for member banks during the year 1918, amounting $1,085,137,254.22, $777,982,268.83 was secured by Government war obligations, showing the extent to which the Federal Reserve Bank has been called on to give assistance. Due to this assistance the support rendered by the banks to the Government has had little effect on the general business in this district. At the re quest of the Federal Keserve Board many banks discriminated against loans for nonessential purposes, but legitimate essential business de mands have been taken care of by the banks without hesitation at a fair rate of interest. The following figures show the assistance given member banks during the period of the war: On April 1, 1917, just prior to the entrance of the United States into the war, the bills rediscounted by the Federal Reserve Bank of St. Louis for member banks amounted to only $251,806.43, and the advances made to member banks on their 15-day collateral notes amounted to only $1,310,000. On December 31, 1918, after a year and eight months of war financing, the bills discounted for member banks amounted to $21,249,353.85, of which $3,904,341.50 were secured by Liberty bonds and Treasury certificates of indebtedness, and the advances to member banks on their 15-day collateral notes amounted to $49,453,300, of which $49,213,300 was secured by such Government securities. Thus from our entrance into the war to the close of 1918, member banks' paper discounted by the Federal Reserve Bank of St Louis increased from % $1,561,806.43 to $70,702,653.85, of which $53,117,641.50 was secured by war obligations. The effect of war financing on commercial paper in this district has been very noticeable. The market has been considerably below normal. Slight revivals have occurred between the Liberty loan campaigns, but on the whole the commercial paper business has been quiet. The rate on commercial paper during 1918 remained at practically 6 per cent until December, when a downward tendency became apparent. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

598 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. OPERATIONS OF FEDERAL RESERVE BANK BRANCHES. LOUISVILLE BRANCH. The total earnings of the Louisville branch for the year 1918 amounted to $166,666.28, and its expenses amounted to $61,841.22, leaving net earnings of $104,825.06. Of the total earnings of $166,666.26, $149,678.20 was derived from bills discounted for mem bers. During the year the Louisville branch discounted for member banks a total of $83,438,291.71 of paper, and purchased a total of $804,907.72 of bankers' acceptances. Schedule 3 shows the amounts of the different classes of paper discounted by the Louisville branch each month, and Schedule 6 shows the amount of bankers7 accept ances purchased by it each month. For 1918 this bank reappointed Mr. W. P. Kincheloe as manager and Mr. John T. Moore as cashier. It also reelected the following directors for the Louisville branch: Messrs. W. P. Kincheloe, Geo. W. Norton, and W. C. Montgomery. The following directors were reap pointed by the Federal Reserve Board: Messrs. S. M. Sackett and Charles E. Hoge. At the close of the year the Lousiville branch had 23 employees. MEMPHIS BRANCH. On June 5, 1918, the Federal Reserve Bank of St. Louis granted a petition for a branch in Memphis, Tenn., which was later approved by the Federal Reserve Board. This bank appointed as officers of the branch Mr. John J. Heflin, manager, and Mr. A. J. Williams, cashier. As directors of the branch it appointed Messrs. John J. Heflin, J. D. McDowell, and R. B. Snowden. The directors appointed by the Federal Reserve Board were Messrs. T. K. Riddick and S. E. Ragland. The Memphis branch opened for business on September 2, 1918. From that time to the close of the year its earnings amounted to $155,973.91 and its expenses amounted to $68,339.65, leaving net earnings of $87,634.25. Of the $155,973.91 of earnings, $143,211.29 was derived from bills discounted for members. From September 2 to December 31, 1918, this branch discounted for its member banks a total of $71,166,365.40 of paper, and purchased a total of $820,- 488.75 of bankers' acceptances. Schedule 3 shows the amounts of the different classes of paper discounted by the Memphis branch each month during that period, and Schedule 6 shows the amounts of bankers' acceptances purchased by it each month. At the close of the year the Memphis branch had 29 employees. LITTLE ROCK BRANCH. im T-f-it-»/-v 1ft 1 01 C -i-)r\/\ VA/IAVOI T-C rvo AT»TTA T-ioT-*!?- i-vP Gi-f T mtia rtT>onffl/i Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 8—ST. LOUIS. 599 by the Federal Reserve Board. This bank appointed as officers of the branch Mr. John M. Davis, manager, and Mr. A. F. Bailey, cashier. As directors of the branch it appointed Messrs. John M. Davis, Ed. Cornish, and W. L. Hemingway. The directors appointed by the Federal Reserve Board were Messrs. Moorehead Wright and Geo. W. Rogers. The branch did not open for business during 1918, but it is expected to open on January 6, 1919. INTERNAL ORGANIZATION. The directors of the Federal Reserve Bank of St. Louis during 1918 were as follows: Messrs. Frank O. Watts, Walker Hill, and Sam A. Ziegler, class A directors; Messrs. David C. Biggs, W. B. Plunkett, and Le Roy Percy, class B directors; and Messrs. Wm. McC. Martin, John W. Boehne, and C. P. J. Mooney, class C directors. Mr. Wm. McC. Martin was also chairman of the board and Federal Reserve agent, and Mr. John W. Boehne was deputy chairman. Of these directors, the terms of Messrs. Frank O. Watts, David C. Biggs, and Wm. McC. Martin expired on December 31, 1918. An election was held from November 19 to December 6, 1918, for the selection of class A and class B directors to succeed those whose terms expired December 31, 1918. Mr. David C. Biggs was reelected by the banks in group No. 1 as a class B director, to serve for three years from January 1, 1919, and Mr. J. C. Utterback, president of the City National Bank, Paducah, Ky., was elected by the banks in group No. 2 as a class A director, to serve for three years from Janu ary 1, 1919, to succeed Mr. Frank O. Watts. By reason of the amendment of September 26, 1918, to the Federal Reserve Act, which provided that no officer or director of a member bank should serve as a class A director of the Federal Reserve Bank unless elected by the group to which his bank is assigned, Mr. Frank O. Watts was ineligible for reelection by the banks in group 2 as the Third National Bank, St. Louis, of which he was president, was in group 1. As required by the amendment referred to, the banks in this district were reclassified by the Federal Reserve Board, as follows: Group 1, all banks with capital and surplus in excess of $599,000; group 2, all banks with capital and surplus not exceeding $599,000 and not below $100,000; and group 3, all banks with capital and surplus below $100,000. In group 1 there were 34 ba,nks, of which 31 qualified to vote and 29 voted. In group 2 there were 168 banks, of which 126 qualified and 114 voted. There were 307 banks in group 3, but they did not participate in the election, as the term of no director elected by that group expired on December 31, 1918. Considerably more interest was manifested in this election than in the previous ones. On December 11 the Federal Reserve Board reappointed Mr. Wm. McC. Martin as a class C director, for three years from January 1, Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

600 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. 1919, and redesignated him as chairman of the board and Federal Reserve agent. The directors held 22 meetings during the year, with an average attendance of 8. The executive committee during 1918 consisted of the governor of the bank, the Federal Reserve agent, and Directors Walker Hill, F. O. Watts, and D. C. Biggs. From the first of the year to the early part of July it met twice each week, but since then it has met daily. On January 9 the directors elected the following officers for the year 1918: Mr. Rolla Wells, governor; Mr. W. W. Hoxton, deputy governor; James G. McConkey, secretary and counsel; Mr. O. M. Attebery, cashier; Messrs. R. R. Clabaugh, A. H. Haill, J. W. White, and J. W. RinklerT, assistant cashiers; and Mr. John A. Will, general auditor. Mr. F. O. Watts was also reelected to represent this bank on the Federal Advisory Council during 1918. The duties of Mr. Hoxton, who had previously acted as both deputy governor and cashier, were divided by the election of Mr. Attebery as cashier. Messrs. White and Rinkleff were newly elected assistant cashiers. On July 31, 1918, Mr. John A. Will, general auditor, resigned, to accept a position with the Federal Reserve Board as a Federal Re serve Examiner. On September 4 Mr. E. J. Novy, assistant auditor, was appointed general auditor to succeed Mr. Will. At the close of 1918 the bank, with its branches, had 385 em ployees, including the officers, of whom 126 were employed on fiscal agency work. At the close of 1917 the bank had 171 employees, of whom 66 were employed on fiscal agency work. CLEARINGS. The clearing plan which went into effect on July 15, 1916, has continued with very satisfactory results. The volume of business handled and the number of State banks clearing at par are con stantly increasing. At the close of 1917 the Federal Reserve Bank of St. Louis was able to collect at par on 1,476 banks in the Eighth Federal Reserve District. At the close of 1918 the number of such banks had in creased to 1,558. At the close of 1918, 25 nonmember banks were carrying collection accounts with the Federal Reserve Bank of St. touis and its branches. Nineteen of such accounts were carried with the parent bank at St. Louis, one with the Louisville branch and five with the Memphis branch. Attached hereto as Schedule 19 is a table showing total number and amount of city items, country items in this district, and other dis trict items, handled by the Federal Reserve Bank of St. Louis and its branches each month during 1918. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT £T0. 8 ST. LOUIS. 601 This table shows that the number of items, both city and country, handled for the month of December was more than double that handled for the month of January. This is due, somewhat, to a natural increase in business, but principally to the suspension of the service charge on June 15, 1918. It will also be seen that the number of items handled, payable in other districts, shows an increase after the suspension of the service charge, but a decrease during the latter part of the year. This is the result of the bank's encouraging its members to route items payable in other districts direct to the Federal Reserve Bank or branch thereof serving the territory in which the items are payable, thus avoiding unnecessary handling and insuring the utmost promptness in the presentation of all such items. On September 3, 1918, the limit for which a Federal Reserve ex change draft could be drawn was increased from $250 to $5,000. Since that time 1-6 member banks have asked for permission to use these drafts and have been furnished with a supply of them. Of these banks, 5 are attached to the Louisville branch, 2 to the Mem phis branch, and 9 to the parent bank at St. Louis. Several of these member banks are making active use of this form of exchange in lieu of carrying accounts in other districts for exchange purposes, while others have not as yet used any of the drafts which were furnished them. Schedule 20 shows the number and amount of checks and war rants on the United States Treasurer handled by the Federal Reserve Bank of St. Louis and its branches each month during 1918; Sched ule 21 shows the volume of coupons handled. The volume of checks, warrants, and coupons handled for the Treasurer of the United States shows a constant increase for the year 1918. Arrangements were made, effective on and after December 17, 1918, whereby the clearing-house balances of the Assistant Treasurer of the United States at St. Louis were settled as a transfer of funds between general account of the Treasurer of the United States with the Assistant Treasurer at St. Louis and the Federal Reserve Bank, without the actual transfer of currency, the balances being disposed of simply by book entries. This does away with the necessity of the Federal Reserve Bank of St. Louis transporting funds between its office and the Assistant Treasurer's office, except as it supplies the Assistant Treasurer with Federal Reserve notes to meet his current needs. COLLECTIONS. The service charge on collection items was suspended on June 15, 1918. This resulted in the member banks making greater use of the facilities afforded by this bank for the collection of notes, drafts, and Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

602 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. other items. For the year 1918 the following collection items were handled by the Federal Reserve Bank of St. Louis and its branches: Number of items. Amounts. St. Louis 7,681 $24,280,916.05 2,898 6,530,080.56 Branch at Memphis 783 2,658,609.94 Total 11,362 33,469,606.55 GOLD SETTLEMENT FUND. During 1918 the transfers through the gold settlement fund in Washington have increased, and it has proven to be an ideal medium for the settlement of exchange operations without the actual transfer of funds from one Federal Reserve Bank to another. Until July 1, 1918, settlements through the gold settlement fund were made weekly, but since that date they have been made daily. Attached hereto as Schedule 22 is a table showing the total debits and credits of the Federal Reserve Bank of St. Louis through the gold settlement fund for each week during 1918, and also the bal ance to its credit each week in the fund. BANKING QUARTERS. The Federal Reserve Bank outgrew the quarters which it occupied a year ago, and in addition to its quarters on the second and fourth floors of the Federal Reserve Bank Building, it was necessary to take the second, third, fifth, and sixth floors of the building adjoining this building, so as to provide working space for the bank proper and the fiscal agency departments. On December 18, 1918, the directors decided to secure permanent quarters for the bank and authorized, subject to the approval of the Federal Reserve Board, the purchase of the premises occupied by the St. Louis Union Trust Co. and the St. Louis Union Bank, on the northwest corner of Fourth and Locust Streets, having a frontage of 88 feet on the west side of Fourth Street and a frontage of 127 feet 3 J inches on the north side of Locust Street to an alley, and also three pieces of property contiguous to and immediately north of this property, thereby affording an additional frontage of 72 feet on Fourth Street, running back to the alley. This is a thoroughly sat isfactory location for the Federal Reserve Bank, as it is convenient to all of the large downtown banks. The building is in good condi tion, and its interior can be rearranged at an extremely small cost to meet the requirements of the Federal Reserve Bank. It has one of the best and largest safe-deposit vaults west of the Mississippi River, which can be easily adapted to the use of the Federal Reserve Bank Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTKICT NO. 8 ST. LOUIS. 603 and, in addition, there are a number of strong well-built money vaults which are now being used by the bank and the trust company. The purchase of these premises was approved by the Federal Keserve Board on December 27, 1918, and the deal is now being consummated. EXHIBIT A.—Movement of principal earning assets of the Federal Reserve Bank of St. Louis during the calendar year 1918. [In thousands of dollars: i. e., 000 omitted.] Dis [s c e U c o p u n u a r n p i e t t d e e e r d d b y co O d u t i n h s t e e r d d+2) bou o B p g il e h l n t s in b c i o T l u l o s n t d a te l i d s Pe ( r 1 + c 5 e ) n t. States paper. market. and war obli bought. gations. Jan. 4.. 548 25,751 34,299 7,416 41,715 20.5 1 11 8 . . . . 57 , , 0 7 8 6 7 7 2 2 1 2 , , 5 6 2 1 4 9 2 28 8, , 6 3 1 8 1 6 7 6 , ,2 3 4 8 1 4 3 3 5 4 , , 9 6 9 2 5 7 1 1 9 6 . . 7 7 25.. 5, 217 24, 749 29,966 5,930 35,896 14.5 Feb. 1.. 6, 877 25,147 32,024 5,727 37, 751 18.2 8.. 7, 144 24, 826 31,970 5,213 37,183 19.2 15.. 5, 378 18,237 23,615 5,431 29,046 18.5 21.. 5 451 16,019 21,%470 6,323 27,793 19.6 Mar. 1.. 7, 069 15,505 22,574 6,204 28,778 24.6 8.. 9! 162 16,444 25,606 6,376 31,982 28.6 15.. 9: 578 13,149 22,727 7,258 29,985 31.9 22.. 9, 260 15,558 24.818 8,208 33,026 28.0 29.. 13, 561 18,506 32,067 8,537 40,604 33.4 Apr. 5.. 15, 202 19,881 35,083 11,150 46,233 32.9 12.. 11, 785 18,880 30,665 10,793 41,458 28.4 J J M S A N D O u u e u o e c a n l p y y g c t v e . t . . . . 3 2 2 1 2 1 2 1 1 1 1 2 2 2 1 3 2 2 1 2 1 2 1 1 1 2 2 3 5 7 1 1 9 8 6 4 4 9 2 0 2 8 7 9 1 6 4 3 6 6 0 6 0 0 2 3 5 7 5 9 8 3 7 0 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . , . . . . 2 2 1 1 2 2 1 1 1 3 3 1 2 2 3 2 3 2 2 3 3 4 5 5 3 5 5 5 4 5 5 4 4 5 4 4 5 2 6 9 4 9 0 9 3 3 3 0 0 9 6 0 9 3 8 5 2 6 0 4 4 8 2 4 4 9 2 2 4 4 4 9 7 0 ; ! , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , 0 6 4 5 2 2 0 9 4 8 6 0 6 9 7 3 7 3 4 1 2 7 8 7 5 2 4 3 1 2 2 4 1 1 2 9 8 4 9 8 0 2 3 4 5 2 0 5 6 1 5 6 6 4 7 5 7 4 9 1 6 3 0 6 8 9 3 0 4 6 8 2 6 1 2 5 0 8 9 9 1 1 7 6 1 9 6 3 7 1 5 1 9 1 7 3 2 3 6 9 4 3 3 4 9 9 4 4 8 2 9 2 1 2 2 2 2 1 2 3 3 1 2 2 2 2 2 2 2 2 1 1 2 2 2 2 2 2 3 3 2 2 3 3 2 2 1 0 8 3 1 8 2 4 2 7 4 3 7 2 7 9 7 7 9 4 9 9 6 1 4 4 4 3 3 7 8 8 9 9 2 6 2 0 , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , 1 9 0 9 3 7 7 7 4 7 8 2 1 4 5 0 3 9 4 8 8 2 8 8 3 0 5 2 7 2 0 9 1 0 1 7 7 6 7 8 0 2 5 3 8 2 5 2 1 5 1 2 1 7 0 9 2 8 9 8 8 6 3 3 8 3 8 2 8 6 6 9 5 2 1 7 2 6 9 1 4 5 8 4 1 0 5 6 1 2 5 6 9 4 6 8 1 8 5 6 1 9 3 4 7 4 8 5 4 2 8 3 4 4 4 2 3 3 3 4 4 6 6 5 5 5 5 5 4 6 4 5 6 6 7 8 8 8 7 7 7 6 8 8 8 7 8 7 0 3 9 3 9 7 9 0 1 6 4 4 3 8 9 8 7 3 7 2 0 7 8 2 7 1 1 1 0 8 5 6 5 1 9 7 0 . , , , , , , , , , , , , , , , , . , , , , , , , , , , , , , . , , , , , 2 6 1 2 7 8 1 8 2 2 3 4 5 8 6 6 1 8 3 5 7 1 6 2 9 4 9 3 1 5 2 5 5 0 0 0 4 5 8 5 8 3 4 5 5 1 5 5 8 8 2 6 5 5 1 9 7 8 8 5 8 0 1 3 7 6 4 1 7 2 3 4 5 1 5 6 8 5 3 1 2 0 4 7 7 6 2 7 6 5 0 9 3 8 7 1 7 5 1 8 6 2 4 6 9 7 3 3 8 2 4 1 1 1 8 7 6 4 6 5 3 3 0 1 1 2 2 2 2 2 2 2 2 4 1 1 4 1 1 1 4 4 4 3 3 3 6 7 3 3 7 , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , 9 6 6 1 9 9 9 7 8 0 3 6 6 9 9 7 8 7 9 3 4 0 3 0 2 4 1 7 7 9 3 8 8 4 6 7 8 9 4 9 2 4 5 6 4 9 0 8 5 7 0 2 0 2 6 4 4 9 5 7 0 3 5 1 0 4 2 6 9 5 2 2 4 3 1 4 4 5 7 0 9 0 1 5 3 1 9 9 5 3 1 2 8 7 3 5 3 0 7 2 3 4 5 6 6 9 6 4 3 9 3 5 5 5 5 3 3 3 4 5 5 6 6 5 5 6 6 6 5 6 4 5 6 7 7 8 8 8 7 8 8 8 8 8 8 8 7 7 2 5 0 1 7 5 6 7 2 0 7 9 6 2 0 1 7 0 2 9 5 4 0 9 6 9 6 4 7 5 8 3 3 4 9 0 3 , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , 8 0 1 2 5 7 2 8 9 1 3 6 4 0 0 2 4 4 7 1 2 4 2 0 6 9 4 7 6 4 4 6 9 1 7 4 8 5 8 3 4 3 6 4 4 0 4 3 6 8 3 9 3 3 3 0 1 8 1 9 4 6 2 1 6 0 1 2 5 1 6 7 7 0 1 9 7 8 6 9 4 7 0 3 2 2 9 9 9 3 1 0 5 0 1 9 4 7 3 2 1 7 1 8 5 7 8 9 7 8 8 3 4 3 5 3 3 3 3 4 4 4 4 4 5 4 4 5 5 5 5 6 5 6 6 6 6 6 5 5 5 6 6 6 6 5 6 6 7 7 6 4 4 4 6 6 7 3 6 5 5 0 5 8 8 3 0 8 7 1 2 0 2 7 8 7 3 1 0 1 3 3 7 9 3 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9 6 5 5 9 9 9 5 1 1 5 7 2 4 9 5 6 6 2 5 8 4 2 6 2 9 8 1 2 8 0 8 2 7 7 4 2 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

604 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. FEDERAL RESERVEBANKOFST.LOUIS. MOVEMENT OF EARNING ASSETS DURING THE CALENDAR YEAR 1318, Carre/: War/barvSixfver. Curve Z.JobalJBills Siscoanteci. Gzrte3:£B&!Disc0zmC^and><j8ovu}hfr. Curve4-:JofaL€cLrrvutuiJlsse&s, inci. U.S, GovernmentSecvwtdocs. 9 Curve S:jtatio ofWar/bcutS^mer \ to JotaZSills £)6scoujited, and^ooix^ht. / \60 \w \60\ & IIO \SS\ \\SO\ joo ASO\ \W\s9 0 vfs\ v*o\ GO vio\ \\3S FO \35\ \\30\ 60 \30\ \\2S\ SO \2S\ \20\ 40 \20\ U5* 30 \JS\ Uo\2 0 \io\ 10 \o 4ItI82SI41521 IS I5Z.&SZBX3I0I7#317KZI2SSIZ826Z9IS3306B&Z74IIB2SISG22296J3&&\ JAN. 1 rEB\ MCM.\APR.\MAY \JUNE\JULY \AU6\SCPT\ OCT. I NOV. 1 DECT Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT £T0. 8 ST. LOUIS. 605 EXHIBIT B.—Movement of cash reserves, net deposits, Federal Reserve note liabilities, and the reserve percentage of the Federal Reserve Bank of St. Louis during the calendar year 1918. [In thousands of dollars: i. e., 000 omitted.] Ratio of cash re Federal serves to T r o e t s a e l r v c e a s s . h dep N o e s t i ts. a n c R o t e u t s e a e s l r c v in i e r (2+3) a n n e R d t e d F s e e e p r d v o e e s r i a t l culation. note liabilities combined. Jan. 4 62,847 46,221 59,146 105,367 11 65,464 44,144 58,054 102,198 18 69,113 47,044 57,142 104,186 25 71,336 51,393 56,061 107,454 Feb. 1 70,518 51,993 56,379 108,372 8 67,165 48,120 56,389 104,509 15 75,948 47,745 57,265 105,010 21 75,971 45,297 58,445 103,742 Mar. 1 79,282 48,161 59,966 108,127 8 80,266 50,418 61,894 112,312 2 1 2 5 8 82 ;4 , , 5 3 3 6 0 2 5 5 1 3 , , 8 1 4 0 9 8 6 6 2 2 , , 7 7 0 7 6 0 1 1 1 1 4 5 , , 5 8 5 7 5 8 29. 78,810 58,263 63,558 121,821 Apr. 5 72,959 54,722 63,349 118,071 12 68,987 47,893 61,671 109, 564 19. 62,866 51,067 61,228 112,295 26. 57,879 51,072 60,867 111,939 May 3. 55,365 41,542 64,124 105,666 10 59,638 47,165 64,198 111,363 17 82,150 53,396 64,446 117,842 24 72,407 45,559 63,276 108,835 31 88,493 60,342 64,716 125,058 June 7. 75,055 53,863 65,004 118,867 14 80,268 66,426 64,921 131,347 21 67,901 51,434 65,211 116,649 28 66,510 66,641 65,662 132,303 July 5 54,401 52,945 67, 617 120,562 12 62,263 49,337 67,932 117,269 19 62,987 51,758 69,314 121,072 26 59,235 46,911 72,726 119, 637 Aug. 2 66,375 51.008 74,926 125,934 9 70,736 51,012 77,037 128,049 16 81,408 49,191 80,158 129,349 23 91,238 56,190 81,825 138,015 30. 86,611 53,175 84,918 138,093 Sept. 6. 81,829 53,592 87,705 141,297 13. 83,065 52,536 92,866 145,402 20. 83,533 53,908 97,294 151,202 27. 78,252 54,734 100,170 154,904 Oct. 4. 73,821 52,135 106,462 158,597 10. 62,575 37,944 107,506 145,450 18 72,822 49,035 108,382 157,417 25 77,238 45,069 107,164 152,233 Nov. 1 83,031 61,637 108,542 170,179 . 8 86,146 63,852 109,188 173,040 15 83,196 53,354 111,636 164,990 22 89,008 55,387 110,935 166,322 29 87,202 56,698 111,403 168,101 Dec. 6 87,761 55,816 112,342 168,158 13 87,716 54,577 115,110 169,687 20 95,338 52,902 118,433 171,335 27 100,892 50,097 120,722 170,819 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

606 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. FEDERAL RESERVE BANK OFST.LOUIS. DEPOSIT AND NOTE LIABILITIES, ALSO CASH RESERVES, DURING THE CALENDAR YEAR 1918. Guvel:JVet2)eiiosits. Curv62.-JoUl.CashJlesen>es. Cwrre4:5uUio tfCtzsh .Reserves to Jfggregate Jte8epx>sita}ul3:&.Jfate£uLbiUbies. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT K"0. 8 ST. LOUIS. 607 SCHEDULE 1.—Comparative profit and loss statement, 1917-18. Jan. 1,1917, to Dec. 31, Jan. 1,1918, to Dec. 31, 1917. 1918. Earnings from— Bills discounted—members $347,871.10 $2,197,795.40 Bills discounted—Federal Reserve Banks. 10,367.40 20,273.21 Bills purchased—acceptances 170,233.26 226,163.86 United States securities 110,300.98 89,096.26 Municipal warrants 13,691.40 Exchange 57,919.95 "~~l8*209*i6 Bill of lading drafts 7,492.56 5,703.16 Depleted reserve penalties 14,968.34 52,106.85 Sundry profits 1,203.26 11,404.14 Transit department income 4,665.13 26,076.31 Total earnings 738,713.38 2,676,828.35 Expenses: $174,461.12 $472,885.40 Currentexpenses...{g^ 87,391.10 Federal Reserve Board assessments. 12,733.22 18,397.54 Cost of Federal Reserve currency 49,363.00 147,347.07 • 236,557.34 726,021.11 Profit on operation 502,156.04 1,950,807.24 Dividends paid during year 284,565.61 404,837.60 Reserve for depreciation, United States securities. 172,997.00 Reserve for franchise tax 801,655.61 • 284,565.61 1,379,490.21 Undivided profits for year.. 217,590.43 571,317.03 Undivided profits, previous 12,748.15 230,338.58 Total undivided profits. 230,338.58 Surplus 801,655.61 SCHEDULE 2.—Comparative balance sheets, 1917-18. Dec. 31,1917. Dec. 31,1918. RESOURCES. Bills discounted, members $28,584,397.60 $70,702,653.85 Bills discounted, other Federal Reserve Banks 4,875,838.00 Bills bought in open market 7,362,724.15 * "7*293," 087*96 Bill of lading drafts 566,536.89 United States bonds 2,233,400.00 1,153,400.00 United States gold notes 1,444,000.00 United States certificates of indebtedness securing circulation. "6*568,"666"66 Total earning assets. 45,066,896.64 85,717,141.81 Premium on United States bonds 6,353.15 Interest accrued on United States bonds 24,850.94 33,499.35 Furniture and equipmenc 44,498.74 Cost of unissued Federal Reservo notes 16,166.61 Expenses paid in advance L626.51 8,551.80 Due from member banks' overdrafts Expenses due as fiscal agent from United States Treasury. 124,849.47 "448,*223"89 Total. 218,315.42 490,275.04 Due from Federal Reserve Banks.. 36,678,287.04 24,892,196.40 Due from branches 261,950.52 Deferred debits, transient account.. 13,715,178.67 13,839, 536.66 Exchange for clearing house 514,252.43 1,735, 820.86 Total deductions from gross deposits. 51,169,668.66 40,467,553.92 Gold coin and gold certificates 5,089,137.50 4,056, 010.00 Gold settlement fund 17,884,000.00 12,474, 094.52 Gold redemption fund, United States Treasurer. 929,900.00 3,369, 850.00 Gold deposited with Federal Reserve agent 32,366,430.00 66,673, 935.00 Sterling gold account 2,100,000.00 233, 154.97 Other lawful money 766,626.50 2,449, 950.40 Total reserve cash. 59,136,094.00 89,256,994.89 Due from Treasurer United States, Federal Reserve bank-note redemp tion fund 317,400.00 National bank notes and Federal Reserve notes, other banks 2,047,705.00 3,921,420.00 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

608 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. SCHEDULE 2.—Comparative balance sheets, 1917-18—Continued. Dec. 31, 1917. Dec. 31, 1918. RE SOURCE s—continued. Federal Reserve notes on hand $1,980,400.00 $9,082,835.00 Federal Reserve bank notes on hand. 224,000.00 Nickels and cents 787.'24* 18,608.39 Total other cash.. 4,028,892.24 13,564,263.39 Total resources... 159,619,896.96 229,496,229.05 LIABILITIES. Capital paid in 3,474,600.00 3,799,600.00 Surplus 801,655.61 Undivided profits 230,338.58 Unearned discount and interest 133,422.20 149,980.73 Reserve'for sundry expenses 853.65 5,898.75 Reserve for depreciation on United States securities. 172,997.00 Reserve for franchise tax 801,655.61 Gold settlement fund suspense 776.89 United States Government deposits 5,430,359.99 3,333,007.84 Due to Federal Reserve Banks 30,445,011.49 7,484,495.01 Due to member banks 45,796,967.60 52,830,678.16 Due to nonmember banks' clearing account. 93,432.34 201,070.66 Deferred credits, transit department 11,954,257.21 20,425,347.21 Dividend and expense checks 197,223.90 1,750,667.31 Due to branches 2,178,523.27 Gross deposits 93,917,252.53 88,203,789.46 Federal Reserve notes issued 61,863,430.00 129,119,875.00 Federal Reserve bank notes issued, secured by United States securities. 6,440,000.00 Total liabilities 159,619,896.96 229,496,229.05 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

SCHEDULE 3.— Volume of the different classes of paper discounted by Federal Reserve Bank of St. Louis and by each of its branches each month during 1918. 1008 January. February. March. April. May. June. July. 0 ST. LOUIS PARENT BANK. M Member banks' collateral notes secured by Government obligatp tions $8,905,100.00 $9,447,382.66 $20,348,483.00 $36,022,091.00 $31,302,841.00 $54,186,150.00 $63,199,267.00 Member banks' collateral notes otherwise secured 75,000.00 50,000.00 95,000.00 110,000.00 J Commercial paper otherwise secured and unsecured 25,772,950.33 16,806,758.97 15,302,817.54 21,408,480.39 20,214,244.25 32,915,216.32 31,629,909.61 co Commercial paper secured by Government obligations 65,000. 00 497,029.96 1,688,293.02 177,000.00 515,164.16 1,252, 519.12 806 215 92 *£> Trade acceptances 1,108,623.82 1,754,782.84 2,238,661.03 ; 1,491,415.04 947,941.85 861,466.26 1,172,460.33 Total | 35,851,674.15 | 28,580,954.43 39,628,254.59 [ 59,098,986.43 52,980,191.26 89,310,351.70 96,917,852.86 LOUISVILLE BRANCH. Member banks' collateral notes secured by Government obliga tions 458,000.00 147,500.00 150,500.00 1,571,700.00 2,274,100.00 1,835,600.00 5,099,800.00 Member banks' collateral notes otherwise secured Commercial paper, otherwise secured and unsecured 1 1,642,569. i(3 i,622,506.i4 495,836.67 1 2,171,313.09 3,963,517.12 3,179,615.97 2,795,707.59 Commercial paper secured by Government obligations 244,964.76 I 3,033.75 79,097.50 50,631.90 40,294.08 Trade acceptances 128,818.98 147,853.57 257,346.06 248,376.84 182,232.67 Total 2,345,533.92 1,770,006.14 775,155.65 3,893,900.41 6,574,060.68 5,314,224.71 8,118,034.34 Member banks' collateral notes secured by Government obli gations 9,363,100.00 9,594,882.66 20,498,983.00 37,593,791.00 33,576,941.00 56,021,750.00 68,299,067.00 Member banks' collateral notes otherwise secured 75,000.00 50,000.00 95,000.00 110,000.00 Commercial paper, otherwise secured and unsecured 27,415,519.49 18,429,265.11 15,798,654.21 23,579,793.48 24,177,761.37 36,094,832.29 34,425,617.20 Commercial paper secured by Government obligations.. 309,964.76 497,029.96 1,688,293.02 180,033. 75 594,261.66 1,303,151.02 846 510 00 Trade acceptances 1,108,623.82 1,754,782.84 2,367,480.01 1,639,268.61 1,205,287.91 1,109,843.10 1,354,693.00 Grand total 38,197,208.07 30,350,960.57 40,403,410.24 62,992,886.84 59,554,251.94 94,624,576.41 105,035,887.20 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

SCHEDULE 3.- - Volume of the different classes of paper discounted by Federal Reserve Bank of St. Louis and I ' each of its branches each month during 1918—Continued. O August. September. October. November. December. Total. ST. LOUIS PARENT BANK. Member banks' collateral notes secured by Government obligations. $66,098,883.00 $75,066,250.00 $99,919,800.00 $97,676,375.00 $93,309,708.00 $655,482,330.66 Member banks' collateral notes otherwise secured 50,000.00 100,000.00 542,500.00 325,000.00 100,000.00 1,447,500.00 Commerial paper otherwise secured and unsecured 17,202,826.34 21,882,196.25 24,779,813.97 19,071,878.60 3,799,538.50 250,786,631.07 Commercial paper secured by Government obligations 731,644.00 326,744.13 821,243.93 1,720,691.92 1,868,674.32 10,470,220.48 Trade acceptances 502,012.16 928,875.97 740,088.62 169,664.94 429,922.04 12,345,914.90 Total 84,585,365.50 98,304,066.35 126,803,446.52 118,963,610.46 99,507,842.86 930,532,597.11 O & LOUISVILLE BRANCH. H Member banks' collateral notes secured by Government obligations . 5,193,300.00 6,736,800.00 9,988,000.00 12,862,900.00 7,769,900.00 54,088,100.00 O Member banks' collateral notes otherwise secured Commercial paper, otherwise secured and unsecured 2,114,669.14 440,702.27 2,161,602.85 2,197,224.64 3,223,340.42 26,008,605.06 Hi C Tr o a m d m e e a r c c c i e a p l t p a a n p c e e r s secured by Government obligations 16 5 1 , , 0 2 7 3 5 9 . .0 0 6 0 3 1 0 8 , , 0 6 0 1 0 8 . . 0 8 0 7 3 5 2 5 5 1 , , 8 4 3 7 2 2 . . 8 8 2 9 2 1 0 9 9 9 , , 4 7 3 1 5 9 . . 1 0 4 8 457,543.68 1 1 , , 9 42 1 4 6 , , 8 7 1 7 1 5 . . 4 2 4 1 W Total 7,474,283.20 7,226,121.14 13,026,908.56 15,469,278.86 11,450,784.10 83,438,291.71 MEMPHIS BRANCH. Member banks' collateral notes secured by Government obligations . 8,291,500.00 11,164,500.00 17,384,000.00 17,806,000.00 54,646,000.00 Member banks' collateral notes otherwise secured Commercial paper, otherwise secured and unsecured 3,373,270.95 3,156,827.60 2,689,369.18 4,011,581.02 13,231,048.75 Commercial paper secured by Government obligations 522,750.00 315,756.25 352,600.00 679,700.00 1,870,806.25 Trade acceptances 131,527.03 432,080.49 665,893.92 189,008.96 1,418,510.40 w H Total 12,319,047.98 15,069,164.34 21,091,863.10 22,686,289.98 71,166,365.40 CO H Member banks' collateral notes secured by Government obligations. 71,292,183.00 90,094,55.0.00 121,072,300.00 127,923,275.00 118,885,608.00 764,216,430.66 W Memeber banks' collateral notes otherwise secured 50,000.00 100,000.00 542,500.00 325,000.00 100,000.00 1,447,500.00 Commercial paper, otherwise secured and unsecured 19,317,495.48 25,696,169.47 30,098,244.42 23,958,472.42 11,034,459.94 290,026,284.88 Commercial paper secured by Government obligations 736,719.00 868,113.00 1,462,833.00 2,273,011.00 3,005,918.00 13,765, 838.17 W Trade acceptances 663,251.22 1,090,403.00 1,723,642.00 1,044,994.00 618,931.00 15,681,200.51 O ES Grand total 92,059,648.70 117,849,235.47 154,899,519.42 155,524,752.42 133,644,916.94 1,085,137,254.22 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

SCHEDULE \. Volume of paper discounted for the member banks in each State each month and the number of different banks in each State discounting during 1918. January. February. March. April. May. June. July. Arkansas.. $1,556,922.63 $2,256,817.83 $2,777,638.80 $2,464,801.84 $2,346,585.92 $2,973,025.92 $3,918,477.16 Illinois 341,117.03 374,246.99 372,035.24 3,244,488.68 7,005,879. 23 6,463,530.66 2,605,949.66 Indiana 857,566.60 598,700.00 887,000.00 974,829.31 609,131.76 2,108,500.00 4,182,623.58 Kentucky.. 2,271,433.92 1,700,306.14 661,155.65 3,810,400.41 6,129,928.92 5,015.724.71 7,854,785. 30 Mississippi. 81,973.95 195,217.12 167,470.56 77,000.00 287,550.70 586,550.00 624, 475.13 Missouri 28,565,796.80 23,554,332.64 31,068,443.54 49,782,978.16 40,851,272.54 73,144,052.13 79,119,865.50 Tennessee.. 4,522,397.14 1,671,339.85 4,469,666.45 2,638, 388.44 2,323,902.87 4,333,192.99 6,729,710.87 Total 38,197,208.07 30,350,960.57 40,403,410.24 62,992,886.84 59,554,251.94 94,624,576.41 105,035,887.20 fi Til H Total Total number O Total amount number member August. September. October. November. December. discounted during] of banks banks 1918. dis i c n o g u . nt De 19 c. 1 8 3 . 1 , O Arkansas... $6,434,385.47 $10,227,203.01 $11,105,388.83 $8,535,540.26 $6,637,877. 85 $61,234,665.52 Illinois 1,660;510.47 3,790,237.50 11,027,978.91 6,305,444.09 3,485,792.09 46,677,210.55 161 Indiana 3,224,068.73 3,639,026.18 4,901,113.85 4,334,986.59 2,037,555.00 28,356,101.60 64 H Kentucky.. 7,196,968.20 6,900,621.14 12,526,808.56 15,154,028.86 11,350,784.10 80,572,945.91 68 Mississippi. 574,555.94 975,046.69 1,174,139.82 767,000.00 851,272.59 6,362,252.50 16 Missouri 64,830,155.64 81,874,561.76 101,098,064.93 101,313.242.73 88,071,491.96 763,274,258.33 95 O Tennessee.. 8,139,004.25 10,442,539.19 13,066,024.52 19,114,509.89 21,210,143.35 98,660,819.81 21 3 Total. 92,059,648.70 117,849,235.47 154,899,519.42 155.524.752.42 133,644,916.94 1,085,137,254.22 278 513 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

SCHEDULE 5.—Discount rates of the Federal Reserve Batik of St. Louis duHng 1918. Rediscounts secured by 15-da n y o c t o e l s l . a teral t L if i i b c e a r t t e y s b o o f n d in s d o e r b c te e d r Redisc c o i u al n t p s a , pe c r o . mmer Agricultural and live-stock paper. Trade acceptances. ness. Secured In effect- by L b i o b n e d rt s y S by e c b u i r l e l d s 15 30 60 90 15 30 60 90 15 30 60 90 6 15 30 60 90 s tif o i f c i a n te s re a c b e le iv . days. days. days. days. days. days. days. days. days. days. days. days. months. days. days. days. days. o debted W ness. H O Jan. 1,1918 3£ 4 3£ 4 4 4 4 4i 4i 4£ 4 4| 4* 4£ 5£ 4 4 4 4 A De p c. r . 3 8, 1 , 1 1 9 9 1 1 8 8 4 4 4 4 4 4 M 4 i 1 X4 4 1 J J4 4 1 1 4 4 4 4 f f 4 4 § f 4 4 | f 4 4 4 4 | f 4 4| f 4 4| f % % 4 4 4 4 £ i 4 4* £ 4 4 £ £ H H 1 On Oct. 5 a special rate of 4 per cent was established for paper with 16 to 90 day maturity, secured by fourth Liberty bonds, provided such paper was taken by the member bank at a rate not in excess of the fourth Liberty loan coupon rate of 41 per cent. O SCHEDULE 6.—Acceptances purchased by the Federal Reserve Bank of St. Louis and by each of its branches each month during 1918. January. February. March. April. May. June. July. w St. Louis, parent bank: From member banks and dealers $1,517,314.52 $3,597,195.70 $4,693,173.69 $1,334,014.06 $1,786,190.51 $750,634. 98 $1,021,389.74 From New York Federal Reserve Bank 2,526,276.07 < Total Memphis branch: W O From member banks Louisville branch: Frnm meTnbfT banks.. ..„.,,. 7,132.92 67,954.80 20,849.79 447,241.23 6,826.97 9,920.11 Total from banks and dealers 1,524,447.44 3,665,150.50 4,714,023.48 1,781,255.29 1,793,017.48 760,555.09 1,021,389.74 Total from other Federal Reserve Banks 2,526,276.07 Grand total 1,524,447.44 3,665,150.50 7,240,299.55 1,781,255.29 1,793,017.48 760,555.09 1,021,389.74 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

August. September. October. November, December. Total. St. Louis, parent bank: From member banks and dealers $880,000.00 $240,000.00 $1,691,491.52 $1,443,155.78 $5,516,162.67 $24,470,723.17 From New York Federal Reserve Bank 2,025,237.47 4,551,513.54 Total 29,022,236.71 Memphis branch: From member banks 160,000.00 640,488.75 20,000.00 820,488.75 Louisville branch: From member banks 40,225.00 154,456.90 45,300.00 5,000.00 804,907. 72 Total from banks and dealers 920,225.00 554,456.90 2,377,280.27 1,448,155.78 5,536,162.67 26,096,119.64 Total from other Federal Reserve Banks 2,025,237.47 4,551,513.54 Grand total 920,225.00 554,456.90 4,402,517.74 1,448,155.'78 5,536,162. 67 30,647,633.18 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

614 ANNUAL KEPORT OF THE FEDERAL RESERVE BOARD. SCHEDULE 7.—State banks and trust companies admitted to membership in Federal Reserve Bank of St. Louis during 1918. Date of a s d i m on is . Name. Location Ca s p u i r t p a l l u a s n . d res T o o u t r a c l e s. Aug. 23 Farmers Bank & Trust Co Blytheville, Ark... $75,000.00 $563,1 18.85 May 6 Security Bank & Trust Co Helena, Ark 150,000.00 1,873,2 56.76 Aug. 2 Bank of Jonesboro Jonesboro, Ark 300,000.00 2,067,8 57.00 Nov. 2 Jonesboro Trust Co do 150,000.00 927,6 39.00 July 30 Bankers Trust Co Little Rock, Ark 255,403.00 2,244,2 17.00 Aug. 21 Bank of Commerce do. 450,000.00 4,082,5 35.00 May 2 Mercantile Trust Co do. 360,000.00 1,864,6 91.00 Aug. 9 Southern Trust Co do. 600,000.00 3,417,4 45.00 Aug. 21 Union Trust Co -do.. 400,000.00 3,091,8 87.00 Mar. 25 Merchants & Planters Bank Texarkana, Ark 210,000.00 1,130,0 85.00 Mar. 20 Illinois State Bank East St. Louis, 111.. 400,000.00 3,149,3 55.00 Feb. 18 Citizens State & Trust Bank Edwardsville, 111..., 93,000.00 688,9 85.00 July 31 Gillespie Trust & Savings Bank Gillespie. Ill , 65,000.00 536,8 59.00 Nov. 6 State Bank of Hoiles & Sons Greenville, 111 , 130,000.00 1,153,1 17.00 Aug. 21 Litchfield Bank & Trust Co Litchfield, 111 , 110,000.00 615,8 01,00 Sept. 3 Mercantile-Commercial Bank Evansville, Ind 300,000.00 2, 483,7 06.00 Oct. 25 State Bank & Trust Co Harrodsburg, Ky-. 121,000.00 608,6 77.00 Dec. 28 Farmers & Merchants Bank Hickman, Ky 122,500.00 446: 446.00 Nov. 1 Kentucky Title Savings Bank & Trust Co. Louisville, Ky 415,000.00 6, 703;03 5.00 Sept. 12 Central Trust Co Owensboro, Ky 234,000.00 1,403,5 90.00 Nov. 6 Pike County Bank Bowling Green, Mo 30,000.00 216,7 64.00 Feb. 20 Exchange Bank Jefferson City, Ho.. 120,000.00 1,111,7 88.00 Aug. 21 Lafayette County Trust Co Lexington, Mo 90,000.00 198,1 42.00 Nov. 1 Camden County Bank Linn Creek, Mo 60,000.00 252,0 98.00 J A M M M F O a e u c a a a n b t g y r r . . . . . . 2 2 2 3 2 2 1 2 0 9 0 7 1 7 C A F B S W G a t o a m u a o r m n a t m o e e k r m d r a e i E o c n e r & s f x a r t y c n c C H & i h a o T B u a l m M r n a s T u t m n g e o r s k e r u t e n c r s B C & h c t B a e o a & a T n n & n t k r s k S u T T a st v r r u i u C n s s o g t t s C C B o o a nk M S M M t. a e a c m r L d d d s o o h p o o o n u a h , l i i M l s s , , , o M T M e o o n n 2 1 , , 5 1 2 2 4 5 1 0 1 5 5 2 0 2 0 5 0 0 2 0 0 , , , , , , , 0 0 0 0 5 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 . . . . . . . 0 0 0 0 0 0 0 0 0 0 0 0 0 0 2 8 5 0 1 1 , , , , , 7 9 0 4 6 9 8 8 6 8 0 1 8 2 2 7 5 7 9 0 0 ' . , . , , 8 0 8 0 5 4 7 8 7 0 4 4 3 3 3 1 0 4 4 6 5 . . . . . . . 4 0 0 0 0 0 0 1 0 0 0 0 0 0 SCHEDULE 8.—National banks granted fiduciary powers under section 11 (k) of the Federal Reserve Act during 1918. Citizens National Bank, Eldorado, Ark., authorized to act as trustee, executor, administrator, and registrar of stocks and bonds. First National Bank, Belleville, 111., authorized to act as trustee, executor, admin istrator, guardian of estates, assignee, and receiver. First National Bank, Mount Sterling, 111., authorized to act as trustee, executor, administrator, and registrar of stocks and bonds. First National Bank, Murphysboro, 111, authorized to act as trustee, executor, administrator, registrar of stocks and bonds, guardian of estates, assignee, and receiver. Bicker National Bank, Quincy, 111., authorized to act as trustee, executor, admin istrator, guardian of estates, assignee, and receiver. United States National Bank, Owensboro, Ky., authorized to act as trustee, exec utor, administrator, and registrar of stocks and bonds. First National Bank, Paducah, Ky., authorized to act as trustee, executor, and administrator. First National Bank, Greenville, Miss., authorized to act as trustee, executor, administrator, and registrar of stocks and bonds. Third National Bank, St. Louis, Mo., authorized to act as trustee, executor, admin istrator, and registrar of stocks and bonds. SCHEDULE 9.— Treasury certificates of indebtedness issued in anticipation of third Liberty loan. Date of issue. Maturity. Total offering. Quot t a r i f c o t. r dis Subscription. Jan. 22,1918 Apr. 22,1918 $400,000,000 $12,000,000 $18,090,000 Feb. 8,1918 May 9, 1918 500,000,000 25,000,000 20,064,000 Feb. 27, 1918 May 28, 1918 500,000,000 25,000,000 25,709,000 Mar. 20,1918 June 18,1918 500,000,000 25,000,000 22,842,000 Apr. 10,1918 July 9,1918 500,000,000 25,000,000 21,181,000 Apr. 22, 1918 July 18,1918 500,000,000 23,000,000 25,698,500 Total 2,900,000,000 135,000,000 133,584,500 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 8—ST. LOUIS. 615 SCHEDULE 9.—Treasury certificates of indebtedness issued in anticipation of third Liberty loan—Continued. ANALYSIS OF SUBSCRIPTIONS. Class of banks. b d a i T n s o t k r t s i a c l i t n . (su o N b f u s b c m r a i b n b e k in r s g . P o e f r c b e a n n ta k g s e . s A ub m sc o r u ip nt t io of n . National banks.. 472 458 97.03 $64,025,500 State banks 2,192 1,623 74.04 46,194,000 Trust companies. 225 176 78.22 20,281,500 Private banks 234 119 50.85 2,566,500 Total 3,123 2,376 76.07 133,067 500 Subscription of 18 individuals, corporations, etc. 517 000 Total subscriptions 133,584,500 SCHEDULE 10. — Treasury certificates of indebtedness issued in anticipation of fourth Liberty loan. Date of issue. Maturity. Total offering. Quota for dis Subscription. trict. June 25, 1918 Oct. 24,1918 $750,000,000 $30,000,000 $34,654,000 July 9, 1918 Nov. 7, 1918 750,000,000 30,000,000 31,260,500 July 23, 1918 Nov. 21, 1918 500,000,000 20,000,000 25,952,500 Aug. 6,1918 Dec. 5,1918 500,000,000 20,000,000 24,056,000 Sept. 3,1918 Jan. 2,1919 500,000,000 20.000.000 25,501,500 Sept. 17, 1918 Jan. 16,1919 600,000,000 24,000,000 24,178,500 Oct. 1,1918 Jan. 30,1919 500,000,000 20,000,000 21,360,000 Total 4,100,000,000 164,000,000 186,963,000 ANALYSIS OF SUBSCRIPTIONS. Class of banks. b d a i T s n o t k r t s i a c l i t n . su o N b f s u c b m r a i b b n e i k n r s g . P o e f r c b e a n n t k ag s. e su A b m sc o r u ip nt t i o o f n . National banks 468 461 98.50 $79,922,000 State banks 2,167 1,944 89.71 72,675,000 Trust companies 227 202 88.99 29,310,000 231 194 83.98 4,877,000 Total 3,093 2,801 90.56 186,784,000 Subscription of 15 individuals, corporations, etc 179,000 Total 186,963,000 SCHEDULE 11.- - Treasury certificates of indebtedness issued in anticipation of fifth Liberty loan. Date of issue. Maturity. Total offering. Quota for dis Subscription. trict. Dec. 5,1918 May 6, 1919 $600,000,000 $24,000,000 $24,231,500 Dec. 19,1918 Mav20,1919 500,000,000 20,000,000 21,319,500 Total 1,100,000,000 44,000,000 45,551,000 ANALYSIS OF SUBSCRIPTIONS. Class of banks. b d a i T s n o t k r t s i a c l i t n . su N o b f s u c b m r a i b b n e i k r n s g . P o e f r c b e a n n ta k g s. e su A b m sc o r u ip nt t i o o f n . National banks 471 371 78.76 $20,383,500 State banks 2,179 1,130 51.85 16,803,500 Trust companies 218 128 58.71 6,980,500 Private banks 225 128 56.88 1,362,500 Total 3,093 1,757 56.80 45,530,000 Subscription of seven individuals, corporations, etc.. 21,000 Total 45,551,000 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

616 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. SCHEDULE 12.—Offerings of tax certificates during 1918 and the subscriptions received from District No. 8 to each. IN ANTICIPATION OF TAXES DUE JUNE 15, 1918. Date of issue. Maturity. Subscription. Jan. 2,1918 June 25, 1918 $11,168,500 Feb. 15, 1918 do 1,661,500 Mar. 15,1918 do 2,063,500 Apr. 15, 1918 do 901,500 May 15, 1918 do 3,075,000 Total 18,870,000 IN ANTICIPATION OF TAXES DUE IN 1919. Aug. 20, 1918. July 15, 1919. $4,712,000 Nov. 7, 1918.. Mar. 15,1919. 17,109,500 Total... 21,821,500 SCHEDULE 13.— Third Liberty loan. [Amount, $3,000,000,000; dated May 9, 1918; due Sept. 15, 1928; rate, 4i per cent.] Subscriptions State. Quota. (allotted in Number of full). subscribers. Arkansas. $15,351,550 $22,714,450 163,015 Illinois 18,158,050 31,633,600 190,430 Indiana 9,137,300 13,909,450 74,838 Kentucky 15,943,550 28,389,900 134,052 Mississippi .7,114,700 9,726,850 54,388 Missouri: St. Louis 39,107,350 44,608,050 242, 804 Elsewhere 21,508,450 37,856,750 264,760 Tennessee 9,620)000 . 10,996,850 61,422 Total ; 130,000,000 199,835,900 1,185,709 ANALYSIS OF SUBSCRIPTIONS. Number of Number of Percentage Class of banks. b d a is n t k r s i c i t n . b s a c n r k ib s i s n u g b . s o u f b b s a c n ri k b s su A b m sc o ri u p n t t i o o n f s. ing. National banks 464 464 100.00 $69,205,300 State banks 2,167 2,153 99.35 91,537,350 Trust companies 216 212 98.14 33,010,600 Private banks 219 215 98.12 5,888,900 Total 3,066 3,044 98.27 199,642,150 Subscriptions of 70 individuals, corporations, etc... 193,750 Total subscriptions 1 199,835,900 1 ANALYSIS OF PAYMENTS. Certificates of Cash. Credit. indebtedness. Total. National banks $14,026,720.95 $30,550,526.55 $24,628,052.50 $69,205,300 State banks 31,747,750.67 39,329,106.83 20,460,492.50 91,537,350 Trust companies 7,502,413.08 18,085,361.92 7,422,825.00 33,010;600 Private banks 2,909,970.80 1,454,549.20 1,524,380.00 5,888,900 Individuals, corporations, etc 103,447.50 2,052.50 88,250.00 193,750 Total 56,290,303.00 89,421,597.00 54,124,000.00 199,835,900 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 8—ST. LOUIS. 617 SCHEDULE 14.—Fourth Liberty loan. [Amount, $6,000,000,000; dated Oct. 24, 1918; due Oct. 15, 1938; rate, 41- per cent.] Subscriptions State. Quota. (allotted in Number of full). subscribers. Arkansas $23,842,000 $26,657,650 152,111 Illinois 40,927,000 44,296,550 258,282 Indiana 18,765,000 20,672,700 98,446 Kentucky 37,379,000 39,848.300 176,789 Mississippi 13,498,000 14,771,050 61,285 Missouri: St. Louis 75,856,900 79,009,800 287,654 Elsewhere %. 47,553,100 51,790,250 2%;113 Tennessee 1 18,238,000 18,283,450 64,619 Total 260,000,000 295,329,750 1,395,299 ANALYSIS OF SUBSCRIPTIONS. Percentage Class of banks. N b d u a i m s n t k b r s i e c r i t n . o f b N s a u c n m r k i s b b i e s n r u g b o . f s o u f b i b n s g a c . r n i k b s su A b m sc o r u ip nt t io of n . National banks 467 466 99.786 $104,614,650 State banks 2,163 2,144 99.122 127,376,100 Trust companies 225 221 98.222 53,164,000 Private banks 232 228 98.275 7,690,300 Total 3,087 3,059 99.093 292,845,050 Subscriptions of 52 individuals, corporations, etc 2,484,700 295,329,750 ANALYSIS OF PAYMENTS. Cash. Credit. i C n e d r e ti b f t i e ca d t n e e s s o s. f Total. National banks $15,612,867.08 $45,912,462.92 $32,621,770 $94,147,100 State banks 29,798,002.56 49,934,277.44 37,434,495 117,166,775 Trust companies 6,073,003.00 34,746,737.00 8,877,010 49,696,750 2,716,650.00 1,243,800.00 3,339,725 7,300,175 Individuals, corporations, etc 113,475.00 2,121,750.00 1,000 2,236,225 Total 54,313,997.64 133,959,027.36 82,274,000 270,547,025 Balance not yet due on $49,570,450, being 24,782,725 Total payments 295,329,750 SCHEDULE 15.—Denominations and amounts of Federal Reserve notes issued by Federal Reserve agent to the Federal Reserve Bank of St. Louis each month during 1918', and the totals from Nov. 16, 1914, to Dec. 31, 1918. Month. Fives. Tens. Twenties. Fifties. Hundreds. Total. January $100,000 $500,000 $100,000 $450,000 $1,150,000 February 550,000 $1,810,000 2,280,000 400,000 250,000 5,290,000 March 955,000 2,000,000 2,560,000 200,000 150,000 5,865,000 April 480,000 280,000 720,000 1,480,000 1,240,000 2,800,000 1,040,000 5,080,000 June 1,860,000 920,000 1,120,000 390,000 200,000 4,490,000 July 3,540,000 4,560,000 6,720,000 300,000 200,000 15,320,000 August 3,820,000 4,640,000 6,840,000 700,000 1,000,000 16,000,000 September 5,060,000 4,920,000 4,880,000 1,000,000 15,860,000 October 1,400,000 2,100,000 3,040,000 400,000 200,000 7,140,000 Nbvember 2,400,000 5,280,000 400,000 600,000 8,680,000 December 2,640,000 4,870,000 7,340,000 600,000 800,000 16,250,000 Total issued during 1918... 21,645,000 31,300,000 41,320,000 4,490,000 3,850,000 102,605,000 Total issued from Nov. 16, 1914, to Dec. 31,1917 18,632,950 28,672,940 23,452,160 2,960,050 2,550,000 76,268,100 Total issued up to Dec. 31, 1918 40,277,950 59,972,940 64,772,160 7,450,050 6,400,000 178,873,100 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

618 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. SCHEDULE 16.—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 1918. Fives. Tens. Twenties. Exchanged with Federal Re serve Bank of— Received. Returned. Received. Returned. Received. Returned. Boston $52,200 $68,075 $203,700 $237,550 $110,800 $85,620 New York 484,500 611,545 1,295,000 1,485,890 995,400 1,215,140 Philadelphia 89,000 99,740 279,500 290,230 241,500 321,820 Cleveland 39,000 278,360 128,500 928,600 148,000 1,161,960 Richmond 33,000 151,445 209,500 274,280 -ioi,ooo 415,700 A Ch tl i a ca n g ta o 1,3 5 5 9 3 5 , , 5 7 0 8 0 0 1,3 8 4 5 3 6 , , 2 6 9 3 5 0 2,1 8 5 4 7 3 , , 0 9 0 5 0 0 3 1 , , 6 39 9 4 1 , , 4 6 9 7 0 0 1 • , 8 3 0 4 0 4 7 ,0 2 0 8 0 0 5 1 , , 5 3 9 28 8 , , 8 1 2 0 0 0 St. Louis Minneapolis 59,500 281,515 120,000 403,780 90,666 372,820 Kansas City 310,500 2,099,510 465,000 1,926,570 202,000 2,132,380 Dallas '. 266,750 1,052,210 648,500 1,472,360 534,000 1,204,380 San Francisco 32,145 163,575 87,230 202,880 85,600 383,520 Total 3,315,875 7,005,900 6,437,880 12,308,300 4,652,580 14,220,260 Fifties. Hundreds. Total. Exchanged with Federal Re serve Bank of— Received. Returned. Received. Returned. Received. Returned. Boston $12,000 $26,356 $2,900 $18,200 $381,600 $435,795 New York... 112,650 248,350 80,300 226,500 2,967,850 3,787,425 Philadelphia. 21,500 49,200 12,500 20,200 644,000 781,190 Cleveland 27,800 214,650 13,200 86,900 356,500 2,670,470 Richmond... 8,500 130,300 11,500 27,000 363,500 998,725 Atlanta 44,300 218,300 24,700 49,400 2,309,010 3,847,640 Chicago 102,500 2,095,900 48,000 230,100 5,005,000 12,959,065 St. Louis Minneapolis.. 9,200 23,050 1,800 18,600 280,500 1,099,765 Kansas City.. 7,000 117,800 3,300 60,400 987,800 6,336,660 Dallas 24,100 40,650 26,700 27,800 1,500,050 3,797,400 San Francisco 11,350 49,350 7,400 44,300 223,725 843,625 Total.. 380,900 3,213,906 232,300 809,400 I 15,019,535 37,557,760 SCHEDULE 17.—Denominations and amounts of Federal Reserve notes received by the Federal Reserve agent from the Comptroller of the Currency each month during 1918, and the totals from Nov. 16, 1914, to Dec. 31, 1918. Month. Fives. Tens. Twenties. Fifties. Hundreds. Total. January $400,000 $360,000 $760,000 February 600,000 $1,040,000 $200,000 $400,000 2,240,000 March 1,200,000 2,200,000 2,800,000 800,000 400,000 7,400,000 April 400,000 1,000,000 2,000,000 3,400,000 May 1,500,000 3,000,000 800,000 5,300,000 June 1,000,000 1,000,000 July 3,800,000 2,600,000 2,800,000 400,000 9,600,000 August 3,680,000 5,400,000 5,600,000 400,000 15,080,000 September 5,040,000 3,120,000 4,880,000 1,200,000 800,000 15,040 000 October 2,720,000 4,560,000 7,600,000 14,880,000 November 1,480,000 2,000,000 3,480,000 December 700,000 2,920,000 5,680,000 800,000 10,100,000 Total received during 1918. 20,440,000 27,240,000 35,200,000 3,800,000 1,600,000 88,280,000 Total received from Nov. 16,1914, to Dec. 31,1917.. 16,580,000 27,520,000 23,600,000 3,000,000 2,400,000 73,100,000 Total received up to Dec. 31,1918 37,020,000 54,760*000 58,800,000 6,800,000 4,000,000 161,380,000 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 8—ST. LOUIS. 619 SCHEDULE 18.—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. 31, 1918. Federal Reserve notes received from Comptroller of Currency $161,380,000.00 Notes issued and reissued to Federal Reserve Bank $178,873,100.00 Notes returned by Federal Reserve Bank to Federal Re serve agent $20,471,500.00 Fit notes returned by United States Treasurer to Federal Reserve agent 11,600.00 Unfit notes received by comptroller from United States Treasurer for destruction 29,270,125.00 49,753,225.00 Federal Reserve notes outstanding 129,119,875.00 Federal Reserve notes in hands of Federal Reserve agent 2,990,000.00 Gold for retirement of Federal Reserve notes: In gold redemption fund at Washington $2,543,335.00 In Federal Reserve agents'' fund at Washington 64,130,600.00 66,673,935.00 Paper pledged to secure Federal Reserve notes 75,085,896.33 SCHEDULE 19.— Table showing total number and amount of city items, country items in this district, and other district items, handled by the Federal Reserve Bank of St. Louis and its Louisville and Memphis branches each month during 1918. CITY ITEMS. Louisville Memphis. Number of Number of items. Amount. items. Amount. January 22,449 $13,771,179.45 February 19,821 24,168,708.03 March 24,794 34,152,108.10 April 24,556 31,916,229.41 May 24,999 36,950,731.39 June 25,632 38,937,514.22 July 28,390 51,969,075.10 August 33,077 36,553,745.83 September 31,954 41,939,417.83 26,439 $18,680,477.46 October 56,682 52,964,109.00 34,571 29,204,790.36 November 47,098 48,398,168.65 35,521 30,760,337.72 December 46,023 57,475,723.75 39,459 31,897,108.77 Total 385,475 469,196,710. 76 135,990 110,542,714.31 St. Louis. Consolidated. Number of Number of items. Amount. items. Amount. January 56,158 $226,850, 421.12 78,607 $240,621. 600.57 February.. 53,417 157,337, 496. 68 73,238 181,506! 204. 71 March 59,120 172,223, 510.12 83,914 206,375! 618.22 April 50,375 159,532, 977. 94 74,931 191,449; 207.35 May 50,732 191,019, 076.08 75,731 227,969. 807.47 June 61,056 208,605, 794.89 86,688 247,543! 309.11 July 74,618 191,214, 536. 72 103,008 243,183! 611.82 August 94,448 202,620, 703.04 127,525 239,174',4 48.87 September. 96,669 209,277, 676.63 155,062 269,897 571.92 October 122,651 252,215, 454.21 213,904 334,384',3 53.57 November. 105,378 218,046, 885.96 187,997 297,205, 392.33 December.. 128,723 231,522, 966.58 214,205 320,895. 799.10 Total 953,345 2,420,467,499.97 1,474,810 3,000,206,925.04 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

620 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. SCHEDULE 19.—Table showing total number and amount of city items, etc.—Continued. COUNTRY ITEMS. Louisville. Memphis. Number of Number of items. Amount. items. Amount. 40,921 $5,578,146.79 40,613 5,651,358.79 March 50,534 7,913,879.82 April 57,080 8,793,498.95 May 64,568 9,881,357.11 74,966 9,984,875.22 July 105,588 10,889,644.00 108,933 10,196,912.34 September 105,562 10,492,073.25 28,370 $4,344,252.57 October 114,294 11'858,974.07 39,127 6,864,471.55 109,356 10,852,627.16 37,537 5,882,794.70 December 121,371 13,620,756.84 42,512 6,398,785.51 Total 993,786 115,714,104.34 147,546 23,490,304.33 St. Louis. Consolidated. Number of Number of items. Amount. items. Amount. January 220,348 $47,818,660.12 261,269 $53,396,806.91 February.. 220,652 43,219,702.65 261,265 48,871,061.44 March 262,732 73,484,072.05 313,266 81,397,951.87 April 239.951 75,581,930.98 297,031 84,375,429.93 May 254,784 55,710,219.34 319,352 65,591,576.45 June 298,630 59,488,166.48 373,596 69,473,041.70 July 424,958 67,427,831.07 530,546 78,317,475.07 August 492,052 75,237,019.19 600,985 85,433,931.53 September. 403,160 56,795, 714.23 537,092 71,632,040.05 October 476,380 63,334,172.52 629,801 82,057,618.14 November. 496,866 62,569,130.01 643,759 79,304,551.87 December.. 505,313 63,968,735.19 669,196 83,988,277.54 Total 4,295,826 744,635,353.83 5,437,158 883,839,762.50 OTHER DISTRICT ITEMS. Louisville. Memphis. Number Number of items. Amount. of items. Amount. January 301 $107,741.04 February 316 151,235.83 March 355 112,977.27 April 560 610,695.54 May 662 442,962.25 711 365,168.21 July 1,087 283,664.94 August 1,126 536,457.40 September 1,107 716,223.29 302 $220,740.49 October 2,278 6,632,132.26 532 465;594.09 November 2,131 542,634.77 487 487,307.71 December 2,043 646,985.65 609 271,790.89 Total 12,677 11,148,878.45 1,930 1,445,433.18 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT HO. 8—ST. LOUIS. 621 SCHEDULE 19.— Table showing total number and amount of city items, etc.—Continued. OTHER DISTRICT ITEMS—Continued. SI . Louis. Consolidated. N of u i m te b m e s r . Amount. N of u i m te b m e s r . Amount. Januarv 4,863 $29,723,283.90 5,164 $29,831,024.94 February 4,353 25,537,607.01 4,669 25,688,842.84 March 3,793 31,365,755.08 4,148 31,478,732.35 April 3,795 31,645,691.49 4,355 32,256,387.03 May 4,205 30,385,379.79 4,867 30,828,342.04 June 7,237 27,282,070.67 7,948 27,647,238.88 July 13,067 29,736,956.06 14,154 30,020,621.00 August 20,329 29,333,331.95 21,455 29,869,789.35 September 18,688 30,548,801/69 20,097 31,485,765.47 October 22,354 16,621,257.29 25,164 23,718,983.64 November 16,714 22,171,873.10 19,332 23,201,815.58 December 12,789 18,780,573.82 15,441 19,699,350.36 Total 132,187 323,132,581.85 - 146,794 335,726,893.48 SCHEDULE 20.—Number and amount of checks and warrants on the United States Treas urer handled by the Federal Reserve Bank of St. Louis and its Louisville and Memphis branches each month during 1918. Louisville. Memphis. Number Number of items. Amount. of items. Amount. October 58 $513,397.74 3,649 $274,984.22 November. 116 3,972,037.06 10,071 777,341.17 December.. 1,572 3,819,770.72 17,738 1,313,802.44 Total 8,305,205.52 31,458 2,366,127.83 St. Louis. Consolidated. Number Number of items. Amount. of items. Amount. January 66,836 $18,236,0 72.95 66,836 $18,236,072.95 February.. 120,273 27,721,4 44.07 120,273 27,721,444.07 March 72,878 20,319,4 49.23 72,878 20,319,449.23 April 86,062 18,192,2 86.18 86,062 18,192,286.18 May 124,103 21,528,5 91.53 124,103 21,528,591.53 June 100,468 21,065,4 99.88 100,468 21,065,499.88 July 97,177 23.240,8 55.80 97,177 23,240,855.80 August 137,003 30,218,9 26.60 137,003 30,218,926.60 September. 140,083 30,161,2 03.75 140,083 30,161,203.75 October 164,346 32,992,1 71.60 168,053 33,780,553.56 November. 161,928 35,660,5 24.09 172,115 40,409,902.32 December.. 223,343 40,108,8 03.54 242,653 45,242,376.70 Total 1, 494,500 319,445,829.22 330,117,162.57 SCHEDULE 21.—Number and amount of United States coupons handled by the Federal Reserve Bank of St. Louis and its Louisville and Memphis branches each month during 1918. Louisville. Memphis. Coupons Coupons handled. Amount, handled. Amount. September 26,928 $83,313.45 October 30,280 82,367.99 November 39,540 238,948.92 7,740 $33,371.32 December 41,193 211,496.14 12,607 53,872.00 Total 137,941 616,126.50 20,347 87,243.32 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

622 ANNUAL REPORT OF THE FEDERAL, RESERVE BOARD. SCHEDULE 21.—Number and amount of United States coupons, etc.—Continued. St . Louis. Consolidated. Coupons Coupons handled. Amount. handled. Amount. January 33,100 $133,613.32 33,100 $133,613.32 February.. 11.171 34,401.90 11,171 34,401.90 March 6,089 14,631.83 6,089 14,631.83 April 5,961 34,173.72 5,961 34,173.72 May 257,559 1,120,392.19 257,559 1,120,392.19 June 156,853 652,136.11 156,853 652,136.11 July 61,450 205,358.82 61,450 205,358.82 August 26,438 69,685.12 26,438 69,685.12 September. 321,945 694,355.44 348,873 777,668.89 October 184,606 378,967.16 214,886 461,335.15 November. 270,652 1,077,210.99 317,932 1,349,531.23 December.. 214,013 804,029.35 267,813 1,069,397.49 Total 11,,554499,,883377 5,218,955.95 1,708,125 5,922,325.77 Average per month on total coupons handled, 142,344; amount $493,527.15. SCHEDULE 22.— Total debits and credits of Federal Reserve Bank of St. Louis through gold settlement fund in Washington for each week during 1918, and the balance to its credit on the dates shown. Balance to credit of Fed For week ending— Total debits. Total credits. eral Reserve Bank of St. Louis. Jan. 3.... $38,252, ,000 $41,680,000 $21,314,400 Jan. 10.. 43,943!, 000 45,798,000 23,169,400 Jan. 17.. 40,008!1 ,000 43,159,000 20,820, 400 Jan. 24.. 44,323 ,000 46,503,000 26,656,400 Jan. 31:. 43,524;, 000 43,328,000 26,968,900 Feb. 7... 43,816,, 000 40,209,000 23,402,400 Feb. 14.. 33,439,, 000 42,221,000 32,184,400 Feb. 21.. 46,600,, 000 46,784,000 26,776,400 Feb. 28.. 42,877!, 000 46,592,000 30,519,900 Mar. 7... 49,505:', 000 50,743,000 30,270,400 Mar. 14.. 44,694:, 000 49,066,000 34,642,400 Mar. 21.. 49,060:, 000 47,424,000 33,169,900 Mar. 28.. 51,579:, 000 47,874,000 29,485,900 Apr. 4... 47,188'1; ,000 41,283,000 23,780,900 Apr. 11.. 53,093., 000 50,827,000 21,693,400 Apr. 18.. 55,322:1 ,000 49,751,000 18,368,400 Apr. 25.. 57,464:, 000 52,813,000 16,187,800 May 2... 55,401 ,000 53,255,000 17,605,800 May 9... 51,341 ,000 53,077,000 23,122,800 May 16.. 54,553;, 000 65,523,000 37,421,000 May 23.. 61,304,, 000 52,149,000 23,401,500 May 31.. 41,500,, 000 57,649,000 40,636,600 June 6... 57,283,, 000 44,294,000 27,488,300 June 13.. 56,128;, 000 55,169,000 33,247,300 June 20.. 60,225,, 000 49,669,000 22,476,000 June 27. . 54,224:, 000 63,823,000 32,352,300 July 5... 85,058;, 000 62,783,000 23,235,000 July 11.. 37,620,, 000 55,190,000 35,052,000 July 18.. 64,969,, 000 51,439,000 21,279,000 July 25.. 55,463:, 000 56,639,000 22,270,000 Aug. 1... 54,1521 ,000 57,819,000 25,768,000 Aug. 8. - - 44,804:: ,000 53,707,000 35,270,000 Aug. 15.. 55,6191; ,000 58,989,000 28,162,000 Aug. 22.. 54,011:, 000 60,300,000 29,180,000 Aug. 29.. 61,546>; ,000 59,797,000 27,584,000 Sept. 5.. 51,1881. ,000 47,401,000 24,932,000 Sept. 12. 58,996», ,000 55,806,000 16,513,000 Sept. 19. 60,476',, 000 64,955,000 21,116,000 Sept. 26. 66,022,, 000 62,603,000 17,510,000 Oct. 3... 62,822,1 ,000 55,499,000 13,934,000 Oct. 10.. 68,187:, 000 60,652,000 10,713,000 Oct. 17.. 59,060:', 000 65,937,000 17,261,000 Oct. 24.. 74,860:1 ,000 75,240,000 17,578,000 Oct. 31.. 68,717:, 000 83,338,000 28,999,000 Nov. 7... 62,25i:, 000 60,898,000 27,669,000 Nov. 14.. 62,092;;, 000 63,319,000 30,372,000 Nov. 21.. 62,315,, 000 72,439,000 33,356,000 Nov. 29.. 65,574 ,000 74,712,000 26,493,000 D De e c c . . 1 5 2 .. . . . 4 5 8 0 , , 2 60 1 3 6 ; : l , ; 0 0 0 0 0 0 5 6 7 7 , , 3 5 2 2 9 9 , , 0 0 0 0 0 0 2 23 1 , , 9 3 ( 8 5 8 3 , , 0 0 0 0 0 0 Dec. 19.. 55,659,', 000 72,211,000 31,141,000 Dec. 26.. 48,775:> ,000 61,048,000 30,038,000 Total. 2,815,701,000 2,898,242,000 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. The year 1918 was of peculiar significance to the Federal Reserve Bank of Minneapolis and constituted the first period since organiza tion during which it had opportunity for the full exercise of-its powers in supporting member banks as well as the banking situation in the district generally, and during which its facilities could be made useful in a broad way throughout the area under its jurisdiction. Beginning, as it did, with a period of hesitation, the year developed many serious and unusual problems, and will be remembered as one which created an unlooked-for and unusual expansion in all departments, bringing the bank for the first time into close and intimate contact with all banks, both member and nonmenber, within this district, and im posing upon it responsibilities arising out of the services it rendered, which were of a particularly important character.1 FINANCIAL RESULTS OF OPERATION. There is attached hereto as Schedule 1 a comparative statement of condition at the close of 1917 and at the close of 1918, together with profit and loss account, December 31, 1918. The gross earnings for the year arising out of the largely increased volume of business amounted to $2,049,954.80. Operating expenses were $325,269.80. The cost of Federal Reserve notes and Federal Reserve bank notes printed during the year was $125,021.66, in addition to which the current assessments for expenses of the Federal Reserve Board were charged to expense. Total operating and current expenses were $464,408.23, leaving an excess of earnings over current expenses amounting to $1,585,545.84. i There are appended to this report the following schedules: Schedule 1, Comparative statement of con dition at the close»of 1917 and 1918, and profit and loss account, Dec. 31, 1918; Schedule 2, Gross earnings by months; Schedule 3, Changes in discount rates; Schedule 4, Details of rediscount operations; Schedule 4a, Volume of rediscounts; Schedule 5, Collateral loans; Schedule 6, Trade acceptances; Schedule 7, Domesticacceptances bought; Schedule 8, Acceptances purchased; Schedule 9, Rediscounts for other Federal Reserve Banks; Schedule 10, Data on offerings of certificates of indebtedness; Schedule 11, Government deposits for 1918; Schedule 12, Subscriptions to third Liberty loan; Schedule 13, Subscriptions to fourth Liberty loan; Schedule 14, Bond issue data, 1918; Schedule 15, Bonds delivered, 1918; Schedule 16, Warsavings and thrift stamp sales; Schedule 17, Check clearing statistics; Schedule 18, Federal Reserve note issues and data; Schedule 19, Federal Reserve bank notes; and Schedule 20, Gold holdings of Federal Reserve agent and Federal Reserve Bank. 623 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

624 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. Under authority of the Federal Reserve Board, the bank was per mitted to charge off the balance on the construction of its main vault, amounting to $29,500, and abrasion on gold received from member and nonmember banks amounting to $10,199.23. Dividends fully paid on December 31 amounted to $168,102.97. Out of the substan tial remainder, the bank was able to transfer $688,871.82 to its surplus account, pursuant to law, while transferring an equal amount to special account reserved for franchise tax. Capital and surplus at the end of the year represented the satisfactory total of $3,657,571.82, as against $2,620,150 at the close of the previous year. GENERAL BUSINESS AND BANKING CONDITIONS. The unusual conditions attending the advent of 1918 produced reactions which were strongly felt in all lines of trade and industry and which have not yet entirely disappeared. The momentous events attending the progress of the war produced a natural hesitation in merchandising activities everywhere, resulting almost immediately in the adoption of a well-defined "hand-to-mouth" policy, under which retail stocks were reduced to the minimum requirements and replenished by small and frequent purchases. This resulted in sharply fluctuating and irregular demands on all wholesale and distributing concerns. The unending changes in price levels in the earlier part of the year, together with the scarcity of goods, which became more serious as Government requisitions made themselves felt, produced conditions which caused considerable uncertainty in merchandising operations. In industrial lines, also, there was much uncertainty as to the course of the Government in requisitioning the producing -capacity of the district. The States of this district were fortunate, however, in having an attractive agricultural outlook, with a promise of excellent planting conditions and good prices for the farm products which are the chief production of this area. Under the influence of a very favorable planting season with adequate moisture, trade conditions became somewhat more settled, and as the Government called increasingly upon the manufacturing institutions of the district for production, directly and indirectly, on account of the war, the business situation steadied perceptibly and continued to show a satisfactory condition throughout the remainder of the year. The very favorable crop outlook during the early part of the growing season was seriously altered in late June and July by the lack of moisture when urgently needed in practically all of the northern and eastern section of Montana and throughout the western portion of North Dakota. Crop yields in the areas referred to were very seriously reduced, while the production of the district as a whole was short of the returns indicated during the spring and early summer Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 9—MINNEAPOLIS. 625 months. The money returns were considerably in excess of those of an average year, due to guaranteed Government prices and the heavy demand for coarse and fine grains, live stock, dairy products, and all other items of agricultural production. In the western portion of the district there were large areas where the 1917 crop was short, Fall and early winter conditions in that 3^ear practically ruined the available supply of seed corn, and the spring planting season of 1918 brought on a very severe shortage. The Federal Reserve Bank and other interests were obliged to make the closest investigation as to available seed supplies, but by means of energetic cooperation were able to locate and advertise all the seed within the district that could be spared for shipment. By effecting proper distribution, sufficient seed was obtained to plant a normal acreage, and the 1918 crop was very large and of good quality. In common with corn, other seed was also high in price. The demands of the spring planting season put an unusually heavy burden on all commercial banks, reflected in a sharp rise of the rediscounted paper of the Federal Reserve Bank in April, followed by a steady and rapid increase, which continued until after harvest in the fall. With the beginning of the movement of the new crop, there was rapid liquida tion, and the amount of rediscounted paper held fell off to moderate figures m December. These conditions, together with unusual demands arising out of the Liberty loans of 1918, subjected member and nonmember banks alike to a much heavier demand than in a normal year, and the banks did not hesitate to use the facilities of the Federal Reserve Bank, both in the rediscount of paper and for short-time loans, thus relieving the strain upon correspondents at the larger centers and making available to the district as a whole a large volume of credit that, except for the facilities of the Federal Reserve Bank, in large part at least, would not have been available. The steady drawing of men for military service produced a severe shortage of farm labor in all parts of the district, while at the larger centers the expansion in manufactures created a steady labor demand. Labor wTas fully employed throughout the year at excellent rates, and the district was free from labor disturbances. Bank rates steadied during the early part of the year, and after a gradual advance remained very firm and were free from fluctuation during the remainder of the period. Some slight softening was apparent during the closing months of the year, but the rate levels did not appreciably change. DISCOUNT OPERATIONS. Discount rates of the Federal Reserve Bank were altered in har mony with the movement of bank rates during the year. These Digitized for FRAS1E0R0 823°—19 40 http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

626 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. changes were infrequent and the policy of the bank was to maintain stability, while avoiding too frequent fluctuations, but to preserve at the same time a proper and consistent relation between discount rates and the general level of rates throughout the district. In view of changing conditions, the rate on 30 and 60 day redis counts was changed on April 8 by an advance of one-fourth of 1 per cent to 4£ per cent. The rate on trade acceptances of 15 to 60 days' maturity was advanced, from 3J to 4 and 4^ per cent; and the 4 per cent rate on 90-day acceptances was advanced to \\ per cent. Ad vances were also made in rates for notes secured by Government bonds and collateral notes. No further change was made until September 10, when the 15-day rediscount rate was advanced from 4 to 4| per cent. The 30, 60, and 90 day rates remained unchanged. The 15-day rate on trade acceptances was advanced from 4 to 4| per cent, and the rate on 15-day notes supported by eligible collateral was advanced from 4 to 4^ per cent. The total amount of paper rediscounted during January was com paratively small. In February there was a small increase, but in March there was a decrease. With the opening of spring farming opera tions in April, the total amount of paper rediscounted rose rapidly, the steady advance continuing during May, June, July, and August. There was some falling off in September, followed by moderate liquidation in October and very rapid liquidation in November and December^ The service afforded by the discount facilities of the bank was extended to 580 institutions during the year and covered 32,226 separate items, aggregating $433,791,800.07. Collateral loans secured by eligible paper or Government securities assumed, during 1918, considerable importance. The figures remained small during the first quarter, but advanced rapidly under the influence of the second Liberty loan in May, and continued strong until the close of the year. Large advances were made to representative city institutions in an ticipation of the fall crop moving and of the pressure resulting from the third Liberty loan following almost immediately and coming in conjunction with the heavy movement of farm products to their markets. The movement of collateral loan totals during the year was prac tically parallel with the changing volume of rediscounts. A sharp drop in the totals was noticeable during November and December. The accommodation extended during the year amounted to $276,916,606. It is not the policy of the bank to carry separate accounts showing loans upon eligible collateral and collateral loans upon Government securities. Government securities were, however, very freely used Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 9 MINNEAPOLIS. 627 secured was throughout the year in excess of that on the security of other acceptable collateral. TRADE ACCEPTANCES. The figures presented by the bank's books for the discount of trade acceptances during the year are an unsatisfactory guide as to the progress made in extending the use of this form of paper. Total discounts in this class amounted to $799,371, arising largely from the oil and lumber distributing business, but representing as well some extension of trade acceptances into flour milling and quarrying. Money conditions were such that trade accept ances did not reach this bank in any volume except in periods of unusual demand, and it is noticeable that in anticipation of the Liberty loan and crop moving financing, the amounts held showed increases, while in other months of the year the figures fell off. The advantages of trade acceptances are better known than they were a year ago, but progress in the development of general use of this form of paper is slow in consequence of the difficulty of changing estab lished customs and of altering methods of settlement that have be come thoroughly rooted through many years of use. ACCEPTANCES. The policy of the bank during the year was to buy both domestic and foreign acceptances at periods when the rediscounting demand was light. Domestic acceptances bought aggregated $17,730,727.71, while total acceptances purchased in the open market and from other Federal Reserve Banks amounted to $39,167,834.03. Pursuing the same general policy that has governed the purchase of acceptances, the bank has, from time to time, on the call of the Federal Reserve Board, discounted substantial amounts of rediscounted paper of other Federal Reserve Banks. Accommodation so extended amounted to $73,551,455, consisting of paper received from the Federal Reserve Banks of Dallas, Boston, Philadelphia, Atlanta, and Richmond. RESERVE POSITION. Although there was an increase of approximately $23,000,000 in the gold holdings of the Federal Reserve agent and the Federal Reserve Bank during the year, as a result of continuous and success ful efforts to gather in gold from both member and nonmember banks, the cash reserve against net deposits and note liabilities showed rather sharper fluctuations than during 1917. Due to mod erate rediscounting it was able to maintain comparatively strong reserves during the first four months of the year, running 77.8 per cent in January, 78 per cent in February, 81.9 per cent in March, Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

628 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. and 73.9 per cent in April. The effect of the spring planting demand upon the rediscounts of the bank was apparent in the reduction of the reserve to 69.3 per cent in May, with a further drop to 63.2 per cent in June. In July it dropped to 48 per cent, and in August, during which the demand was heavy, it reached the low point of 43.6 per cent, rising to 44.7 per cent in September and advancing to 61.9 per cent in October, 67.8 per cent in November, and averaging 67.1 per cent in December, reflecting in the last three months of the year the effect of liquidation following the crop movement. At the close of 1916 the combined gold holdings of the bank and the Federal Keserve agent amounted to $36,323,000. At the close of 1917 the figure had risen to $70,334,000, and at the close of 1918 the combined holdings had increased to $93,147,939. Except for the success of the bank in attracting gold, the fluctuations in the reserve percentages would have been even sharper than those experienced during the periods of very active rediscounting which occurred during the year. MOVEMENT OF MEMBERSHIP. The Federal Reserve Bank of Minneapolis received additions to membership during 1918 resulting from the chartering of 17 new national banks. During the same period 54 State banks acquired membership by application to the Federal Reserve Board, retaining their State charters. Nineteen additional State banks automatically acquired membership by conversion into national banks, making a net gain for the year of 90 banks. Membership at the close of the period consisted of 866 institutions, as against 776 at the end of the previous year. It may be noted in this connection that since organi zation a total of 68 State banks have acquired membership while 79 State banks have acquired membership by conversion, making a total of 147 State institutions now members in the Ninth Federal Reserve District. State banks are taking a keener interest in the Federal Reserve system than before. This results in part from their closer contact with the Reserve Bank due to the multitudinous operations in con nection with the Liberty loans and partly from a gradually widening appreciation of the important service that the Federal Reserve system renders to the general banking structure of the country. At the close of the year there were a number of substantial State in stitutions that had the question of membership under consideration and early and favorable action on their part is anticipated. RELATIONS WITH MEMBER AND NONMEMBER BANKS. The unusual problems of the year, and particularly those relating to Government financing, were such as to bring the Federal Reserve Bank into much closer contact with all the banking institutions in Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 9—MINNEAPOLIS. 629 the district than at any time since its organization. In the heavy burdens resulting from the Liberty loans no distinction was made as between member and nonmember banks, the object sought being to consolidate the banking resources of the district behind the Govern ment in the most complete and effective way. The check collection system has been utilized to a larger extent than before, and has shown a steady gain in importance during the year. Many banks have applied for and been granted fiduciary powers. These are, however, subject to certain limitations, resulting from the character of State law. In Michigan, the Federal Keserve Board has found it possible to extend these powers to approved banks in cities of 100,000 population having $150,000 capital or more, and in larger cities, to banks having a capital of $300,000 or more. In Wisconsin, banks in cities with less than 100,000 population, having $50,000 capital, are eligible, while in cities with more than 100,000 population, the minimum capital requirement is $100,000. In Minnesota, $50,000 capital is required in cities of less than 25,000 population, while in cities of from 25,000 to 100,000 population, a capital of $75,000 is required. In cities of more than 100,000 and less than 200,000 population, the capital requirement is $100,000, while in cities with more than 200,000 population $200,000 is the capital required. In South Dakota the capital required in cities with less than 5,000 population is $50,000, while in cities with more than 5,000 population $100,000 capital is required. The require ment in North Dakota is $100,000 capital irrespective of population. The law in Montana is the same. This has somewhat restricted the number of banks privileged to apply for these powers, but still permits a large number of active and well-managed institutions to considerably broaden their func tions. Applications granted by the Federal Reserve Board during 1918 included the following: Merchants National Bank, Billings, Mont.; Montana National Bank, Billings, Mont.; Commercial National Bank, Bozeman, Mont.; First National Bank, Duluth, Minn.; First National Bank, Manistique, Mich.; Northern National Bank, Ash land, Wis.; Ashland National Bank, Ashland, Wis.; Metropolitan National Bank, Minneapolis, Minn.; First National Bank, Superior, Wis. FISCAL AGENCY OPERATIONS. The issue of an unfamiliar form of Government obligation in the shape of certificates of indebtedness in anticipation of Liberty loan payments created a particularly difficult problem early in the year, which required a large amount of work before banks and banking institutions and the general public became familiar with the great usefulness of this form of security. Twenty-two different issues Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

630 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. were offered during the year with increasing participation, and the total amount of certificates sold reached $285,379,500. Details of the respective issues are shown in Schedule 10. TREASURY DEPOSITS AND WITHDRAWALS. Approximately 2,500 banks in the district executed deposit agree ments in accordance with the instructions of the Treasury during 1918. The plan of making payment by crediting the Federal Reserve Bank as fiscal agent was of the utmost value in adjusting the heavy load of Government financing and facilitating operations of great magnitude. Treasury deposits under agreements with the specially designated Government depositaries aggregated $411,493,795 during the year, and by the adoption of this method of making payments, the depositary banks gained an additional period of time in which to. make transfers of funds to the United States Government. A proper adjustment of their own burdens was thereby made easier and the smoothness and lack of strain with which these operations were conducted is to be credited, to a very large extent, to this method, which is responsible for the excellent financial position the district retained throughout the year in the face of very heavy withdrawals. The details of Government deposits and withdrawals and monthly balances are given in Schedule 11. The third and fourth Liberty loans, coming in the early summer and fall of 1918, were handled in much the same manner as the first and second loans during 1917. The subscriptions to the public were received through a largely extended and improved organization, controlled by a central committee, working under the direction of the bank, and the allotments were substantially exceeded. The details of the subscriptions to the third loan are shown in Schedule 12, the details of the fourth loan in Schedule 13, and additional data of interest in Schedules 14 and 15. Schedule 16 shows war-savings and thrift stamp sales during the year, but includes only the figures of the Federal Reserve Bank and does not show the large volume of sales made by the post-offices throughout the district. War-savings stamps to the value of $14,125,634 were sold through the banks, together with thrift stamps amounting to $489,185.50. WAR FINANCE CORPORATION. Early in August, a general circular was issued to all banks and trust companies in the western portion of the district which had suffered from dry weather and crop failure, advising them of the operations of the War Finance Corporation and the conditions under which the latter stood prepared to make advances in support of the Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 9 MINNEAPOLIS. 631 agricultural situation. A few days later a second circular of instruc tions was issued advising banks and trust companies of conditions under which crop-moving loans would be made by the War Finance Corporation. Applications were comparatively few, and advances were made to five different banks for an amount aggregating $36,000. Two of the loans were for crop-moving purposes and aggregated $14,500, and three were for agricultural purposes in the dry district, and aggregated $21,500. CAPITAL ISSUES COMMITTEE. Pursuant to instructions, the Federal Reserve agent early in February formed a representative committee in the Ninth Federal Reserve District to inquire into the use of funds for capital purposes and to exercise general supervision and control over security issues within this jurisdiction, acting under a central committee at Wash ington. Its policy was to encourage those interested in the issue of securities to present their matters to the district committee for ex amination and report to the national committee in Washington. Early in July the membership of the district committee for the ninth district was increased and the work of the committee reor ganized and considerably expanded. It became apparent that the greatest competition, not only with Government financing, but with all legitimate security issues, arises out of the widespread, shrewdly organized, and wholly unscrupulous operations of pro moters of unsound, worthless, or fraudulent securities. The com mittee found many forms of evasion of the provisions of the War Finance Corporation Act. In such cases no attempt was made to issue the commonly recognized forms of securities, but in lieu thereof, participating certificates, certificates under trust agreement, member ships, contracts, service agreements, and other devices were used, and these were sold broadcast to unsuspecting investors, to whom they were represented as having value and being the equivalent of the ordinary kinds of securities. The committee became convinced after patient investigation, and especially after it had analyzed numerous reports from its own investigation, that the sale of unsound and fraudulent securities has for several years past created a drain of not less than $15,000,000, and in all probability, $20,000,000 per year upon the ninth district. The committee handled during the year 373 applications for security issues with the resulting investigations, many of which were involved and assumed considerable importance. It handled in addition several hundred subjects presented informally, which were disposed of by consultation or correspondence. It recommended to the Capital Issues Committee for disapproval proposed security issues aggregating $10,424,125, and secured in addition the post- Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

632 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. ponement until the close of the war of projects involving security issues aggregating $8,313,000. Especial attention was given to the subject of issues proposed, but on which no active proceedings had been taken, and the latter figure would have been substantially increased if there had been added to it the projects which were discouraged and deferred on advice of the committee before they had reached a point where the security issues involved could be definitely determined. Pursuant to instructions of the Capital Issues Committee, the district committee ceased active operations and cleared its docket on December 31. CHECK CLEARING AND COLLECTION. The service charge of 1J cents per item on out-of-town items was discontinued on June 15, thereby eliminating the charge on all except special collection items deposited with the Federal Reserve Bank. This resulted in the extension of the facilities of the check clearing and collection system as there was a slight gain in the number of banks on the par list shortly after this provision became effective. In order to popularize the use of Federal Reserve ex change and transfer drafts, provision was made whereby the maxi mum amount for which Federal Reserve exchange drafts might be drawn was increased from $250 to $5,000. No change was made, however, affecting the use of Federal Reserve transfer drafts, except that the minimum amount for which such drafts might be issued was increased from $250 to $5,000. In view of the large volume of telegraphic transfers of funds and the development of the collection system, and in order to expedite the handling of business, a system of private telegraph wires was installed connecting the Federal Reserve Banks, their branches, and the Federal Reserve Board at Washington. In order to encour age the transfer of funds by wire, it was decided that the Federal Reserve Bank would absorb the cost of telegrams on telegraphic transfers. This arrangement is now in effect. During September, owing to prevailing conditions and in order that our remittance letters might make the mails promptly, the hour when items on out-of-town banks were credited on day of receipt by us, subject to final payment, was advanced from 3 to 2 p. m. (except Saturday, when the hour is 12 o'clock noon). As practically all of the incoming mail is delivered by that hour and local banks had previously adopted the same rule, this arrangement has been quite satisfactory. In conformity with the policy of rendering additional service to the banks in this district, it was decided to inclose self-addressed stamped envelopes in our remittance letters, to be used by banks Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 9—MINNEAPOLIS. 633 in remitting for items inclosed therein. Announcement of our inten tion to do this resulted in the addition of 62 nonmember banks to our par list. At the beginning of the year there were 1,817 banks on the par list out of a total of 3,647 banks in the Ninth Federal Reserve District. There are now 3 713 banks in this district and 7 of these 2,035 are remitting at par. Of the latter number, 866 are member and 1,169 nonmember banks. The volume of business handled has shown a steady growth dur ing the past year. At the beginning of the year the average number of items handled daily was approximately 16,000, while at the end of the year the average was nearly 28,000, aside from the items exchanged through the Twin City clearings by Minneapolis and St. Paul banks. The figures for the Twin City Clearing House (Minneapolis and St. Paul banks) also show a substantial gain. The operations of the Twin City Clearing House by months, for the past year were as follows: January $138, 831, 655. 33 August $171, 304, 734. 00 February 115, 310, 847.14 September 219,425, 715. 33 March 151, 675, 069. 78 October 321,184,497.18 April 160,124, 336. 87 November 235,491, 816. 37 May 180,120, 587. 30 December 258, 719,169. 05 June 165, 687, 789. 95 July 178, 917, 082.15 Total 2, 296, 793, 300. 45 In the transit department vacancies created by the withdrawal of employees to enter military service resulted in the employment of women. FEDERAL RESERVE NOTE ISSUES. The total issue of notes since the organization of the bank reached $123,252,000 at the end of the year. During 1918 a total of $57,140,- 000 was put into circulation. At no time during the year did the Federal Reserve agent have on hand any used notes fit for circula tion, and the steady demand therefor necessitated a continuous issue of new bills. An unexpected feature of the issue was that the demand for notes of $5 denomination showed little variation from 1917, while the demand for notes of $20 denomination increased 40 per cent. The large gain in the issue of $10 notes was partially accounted for by the fact that during November and December the Treasury De partment at Washington made use of notes of the Federal Reserve Bank of Minneapolis aggregating $9,000,000. The cost of preparing notes at Washington, as shown by the figures of July 1, increased 23 per cent, the advance being from $36.36 to $44.75 per 1,000 sheets. During the year a total of $114,286.84 was charged off, covering the cost of Federal Reserve notes. Of this Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

634 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. prepared during 1918 but not yet issued. The total cost of Federal Reserve notes since the founding of the bank amounts to $186,589.99. The arrangement with the Federal Reserve Board to maintain at all times in Washington and in the subtreasury at Chicago a supply of $50,000,000 of the notes of this bank was continued in effect. The Board, however, ordered an additional supply of approximately $13,000,000 during October. Ten million dollars were held in the subtreasury at Chicago at the close of the year; $21,240,000 at Wash ington or in transit; and $22,280,000 in process of being printed at Washington, in addition to which $6,000,000 of $1,000 bills were in process of printing, making a total of $59,520,000, or a substantial excess over the normal supply. FEDERAL RESERVE BANK NOTES. The first issue of Federal Reserve bank notes occurred on September 20, at which time the Federal Reserve Bank held in Washington as security $880,000 in one-year Treasury notes. The tax based on this security was 1J per cent. At the close of the year the balance of the bank's Treasury notes matured and were replaced with special United States 2 per cent certificates of indebtedness. Two per cent United States certificates of indebtedness, amounting to $4,350,000, and 3 per cent one-year Treasury notes, amounting to $530,000, or a total of $4,880,000, were held at the close of the period with the Treasurer of the United States to secure circulation. The bank received during the latter part of the year a total of $4,392,000 of $1, $2, and $5 bills, of which $4,139,608 were placed in circulation. The cost for plates and expressage was $7,898.01, while the circu lation tax to the end of the year, covering 103 days, was $2,836.81. Since the Government's contract with the express companies will not be renewed, shipping charges on both Federal Reserve bank notes and Federal Reserve notes, which represent substantial items of ex pense, promise to be materially higher in 19191 GOLD HOLDINGS. Note has been made of the encouraging increase in the total gold holdings of the bank and the Federal Reserve agent. The amount of gold coin and certificates held in the banks' vaults was substantially less at the end of the year than at the close of 1917, due to the fact that $10,000,000 in gold coin and $7,300,000 in gold certificates were shipped to the subtreasury at Chicago for the credit of this bank in the gold fund. In addition approximately $5,000,000 were shipped direct to the subtreasury by member banks for our credit. A mate rial ^ain in ffold from other Federal Reserve districts, due to drawings Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 9—MINNEAPOLIS. 635 offset by transfers out of the gold fund covering rediscounts for other Federal Reserve banks. During 1918 the Federal Reserve agent's gold fund was charged $9,400,000, covering unfit notes redeemed by the Treasury Department. The percentage of unfit notes increased materially during the year. The destruction of notes during 1918 was not far short of the total destruction during the preceding three years, which amounted to $9,900,000. Daily settlements in the gold fund are in effect and statements are sent weekly by the Federal Reserve Board for verification. The Treasury Department also submits weekly statements of the various redemption funds. The total gold holdings of the bank and the Federal Reserve agent are shown in Schedule 20, which indicates an average balance in the gold settlement fund during 1918 of $15,908,000, and an average balance in the Federal Reserve agent's gold fund of $39,300,000. RESULTS OF WAR FINANCING. The demands of the year had the unavoidable result of increasing heavily the obligations of all commercial banks. The flotation of the two Liberty loans of 1918, the handling of the subscribers' deferred payments, and participation in the successive issues of Treasury certificates were elements which when added to the normal demand during the crop planting and crop moving period, subjected the banks to unusual strain. The district being, however, largely agricultural, the liquidation following the movement of crops in the fall was heavy, and the banks were able to make rapid progress toward a return to normal conditions. At the close of the year liquidation had been such as to reduce the obligations of member banks close to a normal level, while State institutions and trust companies were practically on the same basis. The demands of commercial institutions were on a minimum basis during the year. New financing was avoided wherever possible. Their bank loans were held at the lowest levels consistent with their requirements. This was a factor in assisting to bridge over a difficult period. Business as a whole did not suffer during 1918 and was able to obtain accommodation when needed at fair rates, although the rate level was substantially increased as compared with previous years. Manufacturing institutions had an active year, and the distributing and merchandising business maintained itself in good shape. RESTORATION OF LIQUIDITY. The policy of the Federal Reserve Bank from the beginning of the war has been to vigorously discourage bank investments in Liberty bonds, believing that it was highly necessary that all banking insti tutions give especial care to the preservation of their ability to promptly Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

636 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. take care of their customers and assist in the problem of war financing in their home communities. The banks of the district have therefore avoided large holdings of their own. The amount of Liberty bonds taken on through failure to complete deferred payments was insignifi cant as compared with the total. At the end of the year the com mercial banks of the district were not holders of Liberty bonds to a large extent or to a degree appreciably threatening their liquidity. During the period in which Liberty bonds can not be readily liquidated at par the policy of the Federal Reserve Bank will be to accept Government obligations as collateral for loans upon a minimum rate basis, enabling member banks to convert such holdings into cash or credit, as occasion may demand. CHANGES IN DIRECTORATE AND STAFF. At the close of the year Mr. J. C. Bassett, of Aberdeen, S. Dak., who had served since the organization of the bank as class A director, retired and was succeeded by Mr. Wesley C. McDowell, of Marion, N. Dak. At the same time Mr. F. P. Hixon, of La Crosse, Wis., was reelected to succeed himself as class B director, and Mr. William H. Lightner, of St. Paul, Minn., was appointed to succeed himself as class C director and reappointed deputy chairman. In December Mr. Roy A. Young, assistant to the governor, was elected by the board of directors as deputy governor. In July Mr. R. E. Towle and Mr. L. E. Rast were elected assistant cashiers. In December Mr. L. W. Long was appointed acting auditor in place of Mr. Howard H. Hall, who resigned to accept service elsewhere. The current affairs of the bank have been closely supervised by the board of directors, which at well-attended regular meetings has given a considerable amount of time to the supervision of the institution. Individual members of the board made frequent visits to the bank between meetings and have familiarized themselves with the details of its operation. The number of officers and employees increased from 127 at the beginning of the year to 260, and considerable additions were made to the space occupied by the institution. The honor roll hung in the lobby of the bank showed at the end of the year the names of 45 men in the service or abroad with the Canadian forces. A number of our employees have seen long and active service, and the bank during the year placed a gold star over the name of Garrett T. Mandeville, who gave his life in service to his country. A number of those who have been in service were released before the close of the year and are returning to their old posts in the bank. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 9—MINNEAPOLIS. 637 EXHIBIT A.—Movement of principal earning assets of the Federal Reserve Bank of Minneapolis during the calendar year 1918. [Tn thousands of dollars; i. e., 000 omitted.] Dis S c p c U t u a o a r p n u t e e e i d n r s t t e e s w d b d e y a r O c t o p h u a e p n r e t d e r d i . s (1+2) m i b n o B a o u r il k p g ls e e h n t t . b c i o T l a u l o s n n t d d t a e l i d s Pe ( r 1 - c 5 e ) nt e a T a s r o s n t e i a t n l s g . obliga bought. tions. 1 Jan. 4.. 11,618 12.764 6,425 5.5 23,973 Jan. 11. 11,170 12,220 4,973 6.1 22,050 Jan. 18. 11,418 12,505 2,687 7.2 20,085 Jan. 25. 12,182 13,140 2,226 6.2 22,308 Feb. 1.. 11,945 12,607 1,937 4.6 21,927 Feb. 8.. 11,729 12,011 500 2.3 23,303 Feb. 15. 11,277 11,658 1,957 2.8 23,002 Feb. 21. 10,495 10,865 1,896 2.9 21,171 Mar. 1.. 8,415 8,696 1,695 2.7 23,144 Mar. 8.. 6,009 6,177 3,986 1.7 18,249 Mar. 15. 5,462 5,598 3,611 1.5 16,000 Mar. 22. 5,093 5,239 3,611 1.6 17,064 Mar. 28. 5,112 5,273 11,122 1.0 24,108 Apr. 5.. 5,772 5,963 11,133 1.1 24,365 Apr. 12. 7,361 8,411 10,523 5.5 26,305 Apr. 19. 8,187 11,623 12, 515 14.2 29,602 Apr. 26. 9,581 14,591 11, 546 19.2 30,377 May 3.. 10,594 17,058 10,684 23.3 31,452 May 10. 14,291 20,910 10,128 21.3 34,322 May 17. 15, 568 22,024 7,116 22.2 32,561 May 24. 16,964 24,051 4,745 24.6 32,039 May 31- 19,168 26,330 3,013 24.4 32,596 June 7.. 23,081 30,703 2,375 23.0 33,285 J J J J J J J A A u u u u u u u u u l n l l l n n y y y y g g e e . . l 2 1 2 1 4 2 5 9 2 9 1 6 2 8 . . . . . . . - . . . . - 1 1 1 i 1 1 o 1 3 2 4 0 , , ; 2 2 3 3 3 4 4 4 4 5 7 8 5 3 8 1 , , , , , , , , 2 9 0 2 6 9 1 6 9 6 9 2 5 5 1 1 9 9 7 8 1 8 1 3 3 3 5 5 5 4 5 5 5 1 3 4 5 2 0 5 4 9 , , , , , , , , , 4 6 3 5 9 7 5 7 3 9 6 8 7 8 1 8 5 9 0 7 0 6 0 5 1 0 9 1,0 7 8 8 4 4 3 7 9 4 1 1 2 2 4 9 2 0 0 0 5 5 5 5 2 2 2 2 2 2 1 1 4 0 5 3 3 9 5 8 . . . . . . . . 6 2 9 0 8 6 9 5 3 6 3 5 5 5 5 5 5 3 2 7 0 4 4 8 5 8 , , , , , , , , , 7 3 2 0 3 6 3 8 5 8 2 1 7 7 4 6 2 6 9 9 7 8 6 6 3 2 5 Aug. 16. 20' 35,291 57,760 583 36.3 59,607 Aug. 23. 21' 36,486 64,288 580 36.5 65,771 Aug. 30. 22, 41,725 59,941 435 34.9 61,311 Sept. 6. 24, 35,174 64,815 336 41.1 66,130 Sept. 13 25 39,041 77,368 259 39.6 78,730 Sept. 20 25, 51,457 70,858 262 33.4 72,151 Sept. 27 25, 44,985 67,202 142 36.4 68,425 Oct. 4.. 25, 41,940 57,390 133 37.5 58,651 Oct. 10. 23, 34,122 56,881 115 40.5 59,049 Oct. 18. 22. 34,309 51,496 1,070 39.0 55,666 Oct. 25. 20; 30,792 38,494 3,116 37.9 43,711 Nov.l.. 10, 27,616 46,803 3,691 25.8 52,765 Nov. 8.. 14, 32,636 38,348 3,907 27.9 45,383 Nov. 15 9, 28,405 36,927 3,843 23.6 44,516 Nov. 22. 11 25,019 43,877 4,558 28.7 52,252 Nov. 29. 21 22,222 33,007 5,336 44.0 48,565 Dec. 6.. 21, 11,827 30,326 12,436 46.6 48,071 Dec. 13. 22 7,787 30,736 13,482 51.4 54,771 Dec. 20. 24, 6,105 18,984 49.5 61,093 Dec. 27 - 31 5,645 36.765 19,019 55.8 63,062 32', 5,555 37, 698 20,078 55.6 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

638 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. TEDERAL RESERVE BANK OF MINNEAPOLIS] MOVEMENT OF EARNING ASSETS DURING THE CALENDAR YEAR 1913. GyFvef: Ttfa/bcuvJ&jver. Curre 2:3otal J5iUs2>&scounfal: Ct£rre3:3i[Ls8iscoimt^cui&Jfough&. ^ (^re4:Jbe<^€arnmaJ$seCs, incl,. U.S. fov&nm^StcarUuzsy (XuryeS.ytixtwoffY^jCoaji^mer J Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 9—MINNEAPOLIS. 639 EXHIBIT B.—Movement of cash reserves, net deposits, Federal Reserve note liabilities, and the reserve percentage of the Federal Reserve Bank of Minneapolis during the calendar year 1918. [In thousands of dollars; i. e., 000 omitted.] Ratio of cash re Federal serves to re T s c e o a r s t v h al e s. dep N o e s t its. a R n ct o e u t s e a e s l r c v in i e r (2+3) a n n e R d t e d F s e e e p r d v o e e s r i a t l culation. note liabili ties com bined. Tan. 4... 40,343 49,543 76.3 Jan. 11.. 37,430 49,266 77.7 Jan. 18.. 34,071 49,172 83,243 79.1 Jan. 25.. 41,792 48,930 90,722 78.4 Feb.l.. 41,534 49,103 90,637 78.8 Feb.8.. 40,425 49,432 89,857 77.1 Feb. 15. 38,504 50,007 88,511 77.1 Feb. 21. 36,717 50,507 87,224 78.9 Mar. 1.. 35.136 51,251 86,387 76.5 Mar. 8.. 31,971 52,248 84.219 81.7 Mar. 15. 36,291 52,854 89,145 85.3 Mar. 22. 31,384 53,225 84,609 83.2 Mar. 28. 36,654 53,538 90,192 76.5 'Apr. 5.. 36,453 53,918 90,371 76.3 Apr. 12. 41,833 54,469 96,302 75.8 Apr. 19. 39.137 54,619 93,756 71.6 Apr. 26. 41,074 54,731 95,805 71.5 May 3.. 37,670 54,779 92,449 69.3 May 10. 41,548 54,440 95,988 67.5 May 17. 43,365 54,213 97,578 69.9 May 24. 40,744 53,887 94,631 69.5 May 31. 50,870 53,610 104,480 71.9 June 7.. 44,453 53,635 98,088 66.4 June 14. 43,548 54,071 97,619 64.7 June 21. 42,001 54,693 96,694 63.9 June 28. 36,972 55,213 92,185 48.8 July 5.. 36,749 56,478 93,227 45.4 July 12. 44,186 57,430 101,616 48.5 July 19. 43,020 57,749 100,769 49.9 July 26. 47,902 58,088 105,990 48.4 Aug. 2.. 41,142 58,346 99,488 41.1 Aug. 9.. 40,243 58,657 98,900 44.5 Aug. 16. 44,326 59,328 103,654 46.1 Aug. 23. 46,748 60,607 107,355 42.3 Aug. 30. 41,944 61,939 103,883 44.7 Sept. 6. 40,624 65,410 106,034 41.4 Sept. 13 66,172 67,772 133,944 44.3 Sept. 20. 47,665 72,267 119,932 43.3 Sept. 27 51,417 76,421 127,838 49.7 Oct. 4... 40,759 81,571 122,330 55.6 Oct. 10. 49,321 84,272 133,593 59.4 Oct. 18. 55,853 85,843 141,696 64.2 Oct. 25. 44,660 86,531 131,191 70.4 Nov. 1.. 56,551 85,997 142,548 66.9 Nov. 8.. 44,196 87,171 131,367 69.8 Nov. 15 49,295 87,131 136,426 71.6 Nov. 22 40,894 87,483 128,377 64.3 Nov. 29 47,981 87,597 135,578 69.0 Dec. 6.. 50,335 90,315 140,650 71.1 Dec. 13. 50,384 92,291 142,675 67.1 Dec. 20. 52,416 95,291 147,707 64.2 Dec. 27. 43,925 97,361 141,286 61.3 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

640 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. HS FEDERAL RESERVE BANK OF MINNEAPOLIS. DEPOSIT AND NOTE LIABILITIES. ALSO CASH RESERVES, DURING THE CALENDAR YEAR 19/8^ G&rpel.JVetSkfiosifs. (2vrre2:JotaLGxsk,Jtcserpes. Cbumi^;J!gtfrwabe.Jfo!Dery)g!te Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NTO. 9—MINNEAPOLIS. 641 SCHEDULE 1.—Statement of condition, Dec. SI, 1918. Condition Condition Dec. 31, 1918. Dec. 31, 1917. RESOURCES. Bills discounted and collateral loans to members $6,220,023.91 $8,082,3 27. 78 Bankers' acceptances and rediscounts for other Federal Reserve Banks. 48,368,612. 63 12,154,7 98.99 United States Securities 5,267,030.00 3,228,4 90.00 Municipal warrants 25,3 80.00 Accrued interest on United States securities 16,659.09 17,8 41.63 Furniture and equipment (including vault and safes) 1.00 29,5 01.00 Cost of unissued Federal Reserve currency 12,9 15.48 Expenses paid in advance. -. 2,8 78.74 2,1 27.12 Disbursements for Treasury Department (to be reimbursed) 162,2 12.34 54,1 26.89 Due from other Federal Reserve Banks 4,948,9 34.00 13,247,6 10. 72 Due from banks arid bankers, also deferred debits to member banks 7,877,7 59. 73 4,403,8 30.21 National banks notes and notes of other Federal Reserve Banks 375,1 35.00 169,3 61.00" Five per cent redemption fund for Federal Reserve bank notes 236.2 00.00 Federal Reserve bank notes on hand 463,4 54.00 Federal Reserve notes on hand. 1,813,4 95.00 1,420,865.00 Mutilated Federal Reserve notes forwarded for redemption 340,1 95.00 171,000.00 Other lawful money 72,8 55.85 413,165.61 Gold certificates and gold coin 13,271,9 60.00 15,837,955.00 Gold held with foreign agency 233,1 54.97 2,100,000.00 Gold in settlement fund 1 23,774,4 14.92 19,486,500.00 Gold with Federal Reserve agent 55,868,4 10.00 32,909,950.00 Total. 169,313,386.18 113,767,746.43 LIABILITIES. Capital 2,931,200.00 2,620,150.00 Surplus 726,371.82 Profit and loss 75,157.13 Discount and interest unearned 155,102.02 94,280. 60 Discount and premium on United States bonds 47,430.48 20,682.39 Reserve for franchise tax 688,871.82 Reserved for sundry expenses 23,299.21 6,500.00 Government deposits 5,347,546.30 8,716,529.47 Cashiers' checks 367,634.47 31,488.47 Due to other Federal Reserve Banks 4,513,330.70 10,524,486.54 Due to member banks 51,126,389.36 40,603,711.83 Due to nonmember banks 29,800.00 68,810.00 Federal Reserve bank notes outstanding 4,632,000.00 Federal Reserve notes outstanding 98,724,410. 00 51,005,950.00 Total. 160,313,386.18 113,767,746.43 PROFIT AND LOSS ACCOUNT, DEC. 31, 1918. Gross earnings, Jan. 1, 1918, to Dec. 31, 1918 $2,049,954.07 Less: Assessment for expenses Federal Reserve Board $14,116. 77 Cost of Federal Reserve notes and Federal Reserve bank notes during year.. 125,021. 66 Operating expenses 325,269.80 464,408.23 Excess of earnings over current expenses 1,585,545.84. Less the following items charged off: Vault account 29,500.00 Reserved for abrasion on gold, etc 10,199.23 Dividends for period Jan. 1, 1918, to Dec. 31, 1918 168,102.97 Transferred to surplus 688,871.82 Transferred to account'' Reserve for franchise tax " 688,871.82 Total 1,585,545.84 SCHEDULE 2.—Gross earnings, by months. 1918 1917 January $87,961.88 $3.2,120.87 August... $250,147.62 $60,826.02 February j 82,443.09 31,310.36 September 288,150.06 70,234.08 March 79, 780.38 31,094.02 October.. 236,362.03 58,688.36 April 109,529.86 34,081.81 November 182,225.19 83,835.51 May 138,007.07 43,184. 05 December. 202,466. 59 93,589.13 June 158,682.75 39,952. 37 July 231,197.55 49,421.86 Total 2,049,954.07 628,338.44 Digitized for FRAS1E0R0 823°—19http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

642 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. SCHEDULE 3.—Changes in discount rates. Collat Collat eral eral Notes secured notes note3 Trade acceptances. by Government secured secured Over bonds. by Gov by 15 30 60 90 90 ernment various days. days. days. days. days. bonds. notes. 15 60 90 15 60 90 15 15 days. days. days. days. days. days. days. days. 1918. P.ct. P. ct. P.ct. P.ct. P.ct. P.ct. P.ct. P.ct. P.ct. P.ct. P.tf. Per cent. Percent. Jan. 1.. 4 4-i 4h 5 54 3* M 4 3i 4 4 n 4 Apr. 11 4 4* 4$ 5 5* 4 U 4i 4 4* 4* 4 4 Sept. 10 4^- 4-2- 4 i 5 5\ 4i 4\ 4t 4 4i 4i 4 4* SCHEDULE 4.—Rediscount operations. Number Number Total redisof banks of items counted, by served. received. months. January... 129 1,095 $5,463, 059.55 February.. 88 825 7,253 240.18 March 72 576 2,346 071.95 April... 174 1,843 17,883 752,56 May 276 4,353 29,595 092.29 June 304 4,369 41,698, 265.84 July 399 6,642 59,550, 131.97 August 395 5,359 86,807, 174.37 September. 291 2,893 76,917, 401.00 October... 211 1,604 58,365, 112.90 November. 197 1,764 38,003, 570. 50 December.. 161 903 9,908, 926.95 Total 32,226 433,791,800.07 SCHEDULE 4a.— Volume of rediscounts. Minne North South Wiscon Mon Michi sota. Dakota. Dakota. sin. tana. gan. Total. Number of pieces rediscounted 15,963 5,070 l,20o| 4,649 340 32,226 Total amount rediscounted [$358,768,785 $17,518,176 $31,766,675 $10,284,681 $11,794,375 $3,659,108 [$433,791,800 Total amount, 1917 "'0,234,993 3,060,613 2,357,925 1,204,1751 2,815,187 481,822 80,154,715 Total amount, 1916 4,284,590 527,890 768,393 157,801 215,893 27,501 5,982,008 SCHEDULE 5.—Collateral loans. January $2,120,788 August $61,898,403 February 482,000 September 48,320,335 March 396,960 October 46,817,950 April 10,151,834 November 29,367,180 May 16,110,781 December 8,636,550 June 22,403,920 July 30,209,905 Total 276,916,605 SCHEDULE 6.— Trade acceptances. January $65,349 September $40,221 February 33,394 October 4,629 March 11,662 November 50,576 April. 28,039 December 4,075 May 213,950 July 246,619 Total 79tf,371 August 100,857 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT 3T0. -MINNEAPOLIS. 643 -Domestic acceptances bought. January... August $422,300.00 February.. $616, -SIX). 51 Sep! ember.. 40,500.00 March..*... 3,142, 252. 73 October 3,015, (MI). 00 April...... 563,500. 00 November.. 3,723,315.03 May 630,000. 00 December 4,412,359.44 June... 130,000. 00 July....... 130,000.00 Total. 17,730,727.71 SCHEDULE 8.- - Total amount acceptances purchased in open market arid from other Federal Reserve Banks. January • August $422,300. 00 February $1,555,500. 51 September. 40,500. 00 March. .*. 10,190,079. 53 October 3,915,000. 00 April 1,992,547.18 November 9,265,251. 74 May 1,180,000.00 December 10,346,655. 07 June 130,000.00 July 130,000.00 Total.. i 39,167,834.03 SCHEDULE 9.—Rediscounts for other Federal Reserve Banks. Federal Reserve Bank of- Dallas.. $30,000,000- Boston , 20,032,100- Philadelphia. 15,005,355 Atlanta. 5,000,000 Richmond 3,514,008 Total., 73,551,455i Exclusive of $645,854 bought foe our account by the Federal Reserve Bank of New York on December 31,1918. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

SCHEDULE 10.— United States certificates of indebtedness issued during the year 1918. OS Total Date of issue. a $ n 2 d 5 , l 0 e 0 s 0 s . s N o c f u r i m b su e b r b e s r . ] $ $ 25 5 , 0 0 , 0 0 0 0 0 t . o s N o c f u r i m s b u e b b r e s r . ! $ $ 5 1 0 0 ,0 0 0 ,0 0 0 0 to . s N o c f u r i m s b u e b r b e s r . ] $ $ 1 2 00 5 , 0 0 , 0 0 0 0 0 t . o s N o c f u r i m s b u e b b r e s . r $2 $ 5 5 0 0 , 0 0 , 0 0 0 0 0 t . o s N o c f u r i m s b u e b b r e s r . ! $ a $ 5 1 n 0 , d 0 0 , 0 0 o 0 0 v , 0 0 e 0 r t 0 . o s N o c f u r i m s b u e b b r e s r . ] eac T h o i t s a s l ue. sc e s r a u ib c b h e rs > issue. d Jan. 2... $826,500 95 $610,000 $765,000 $1,478,500 8 $800,000 $750,000 230,000 128 Jan.22.. 2,857,000 313 935,000 1,069,000 957,000 6 500,000 4,432,000 750,000 350 > Feb. 8... 6,949,000 1,154 1,759,000 1,032,000 695,000 4 310,000 4,255,000 000,000 1,220 Feb. 15.. 295,000 52 345,000 215,000 400,000 255,000 64 Feb. 27.. 8,200, 000 1,352 1,999,500 1,810,000 830,500 5 315,000 3,845,000 000,000 1,436 Mar. 15.. 183,000 19 90,000 150,000 297,000 2 720,000 25 o Mar. 20.. 8,763,000 1,376 2,611,000 1,646,500 1,020,000 6 1,108,000 851,500 000,000 1,469 A A p p r r . . 1 1 5 0 . . . . 7,8 1 8 0 6 4 , , 5 0 0 0 0 0 1,21 1 6 0 2,51 5 6 0 , , 0 0 0 00 0 1,3 1 6 1 5 7 , , 0 5 0 0 0 0 2,0 5 9 7 2 8 , , 5 5 0 0 0 0 1 3 2 1,000,000 740,000 8 6 5 0 0 0 , , 0 0 0 0 0 0 1,30 1 6 6 H Apr. 22.. 5,620,000 822 1,131,000 880,000 1,029,000 6 1,850,000 5 j 4,490,000 000,000 873 o May 15.. 736,000 116 150,000 264,000 450,000 3 600,000 129 June 25.. 5,878,000 835 2,251,500 2,778,500 1,414,500 9 600,000 7,077,500 000,000 940 July 9... 8,793,500 1,334 2,286,000 2,041,000 2,450,500 15 1,878,000 4,651,000 100,000 1,440 July 23.. 9,046,500 1,605 2,014,000 1,777,000 887,500 6 500,000 2,575,000 800,000 1,685 Aug. 6.. 7,238,500 1,289 1,635,500 1,494,500 891,500 6 300,000 700,000 260,000 1,356 Aug. 20. 987,000 262 285,000 57,000 500,000 829,000 270 Sept. 3.. 9,652,000 1,501 2,367,500 1,510,500 520,000 3 400,000 2,750,000 200,000 1,584 hrj Sept. 17. 9,840,000 1,460 2,968,500 1,905,000 1,380,000 8 950,000 656,500 700,000 1,565 W Oct. 1... 10,833,500 1,504 3,759, 500 2,399,000 200, 000 1 1,300,000 3,008,000 500,000 1,629 o Nov. 7.. 3,818,000 555 1,004,000 1,057,500 751,000 4 1,700,000 1,890,000 220,500 603 w Dec. 5... 12,263,000 1,731 1,210,500 3,041,000 3,619, 000 28 1,101,000 3,265,500 500,000 1,816 > Dec. 19.. 11,758,500 1,595 3,214,500 2,211,000 1,035,000 6 695,000 3,351,000 265,000 1,712 Total. 132,528,500 20,196 35,193,000 29,586,000 325 22,577,000 111 | 16,207,000 43 49,288,000 | J. w w Total allotment, all groups... $285,379,500 Total subscribers, all groups. 21,626 > Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT HO. 9—MINNEAPOLIS. 645 SCHEDULE -Government deposits for the year 1918. Deposits. Withdrawals. Balances. Dec. 31,1917., $17,983,628.35 January $16,535, 556.22 $18, 924,915.01 15,594, 269.56 February... 19,365, 680.00 14, 870,117.89 20,089, 831.67 March 10,680, 000.00 14, 914,031.67 15,855, 800.00 April 21,906, 700.00 23, 687,338.56 14,075, 161.44 May 45,009, 938.58 26, 503,650.73 32,581, 449.29 June 32,966, 019.96 37, 163,476.86 28,383 992.39 July 57,421, 661.63 41, 528,844.11 44,276; 809.91 August 39,573, 556.13 46, 676,477.07 37,173! 888.97 September.. 38,250, 600.85 53, 671,153.72 21,753! 336.10 October 69,543, 616.67 60, 974,556.38 30,322; 396.39 November.. 19,462, 526.06 39, 289,797.64 10,495, 124.81 December.. 40,777, 939,. 14 36, 311,267.73 14,961. 796.22 Total 411,493,795.24 .SCHEDULE ]2.—Subscriptions to third Liberty loan. Number of sub Amount. scribers. MICHIGAN $50 to $10,000 02,898 $9,004,900 $10,050 to $50,000 8 434,950 $50,050 to $100,000 0 $100,050 to $200,000 1 200,000 $200,050 and over ! ° 62,907 9,639,850 MINNESOTA. $50 to $10.000 • i 594.250 82,481,350 $10,050 to'$50,000 '274 7,861,100 $50,050 to $100,000 38 3,168,350 $100,050 to $200,000 17 2,707,050 $200,050 and over 6 200,225 594,585 98,442,850 MONTANA $50 to $10,000 112,992 14,109,500 $10,050 to $50,000 1 38 966,000 $50,050 to $100,000 3 285,000 $100,050 to $200,000 2 525,000 $200,050 and over 3 1,750,000 113,038 17,635,500 NORTH DAKOTA $50 to $10,000 135,041 12,042,400 $10,050 to $50,000 i 3 60,000 $50,050 to $100,000 $100,050 to $200,000 0 $200,050 and over 0 135,044 12,102,400 SOUTH DAKOTA. $50 to $10,000. 20S, 349 31,323,550 $10,050 to $50,000 4 08,500 $50',050 to $100,000 1 56,600 $100,050 to $200,000 0 $200,050 and over 0 208,354 31,448,650 •WISCONSIN. $50 to $10,000 103,560 11,060,300 $10,050 to $50,000 7 240,500 $50,050 to $100,000 0 $100,050 to $200,000 0 $200,050 and over 0 103,567 11,300,800 Miscellaneous subscriptions 2^650 322,050 Grand total 1,220,145 180,892,100 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

64Q • ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. SCHEDULE 13.—$ inscriptions to fourth Liberty loan, Number of sub Amount. scribers. MICHIGAN $50 to $10,000 70,349 $9,030,800 $10,050 to $50,000 44 1,033,000 $50,050 to $100,000 , 10 676,000 $100,050 to $200,000 6 975,000 $200,050 and over 1 250,000 70,410 12,564,800 MIXXESOTA $50 to $10,000 115,087,400 $10,050 to $50,000. 138 8,930,850 $50,050 to $100,000. 28 4, 032,000 $100,050 to $200,000. 20 2,990,000 $200,050 and over 7 1,675,000 042,948 133,315,250 MO XT AX A. $50 to $10,000 129,005 17,185,500 $10,050 to $50,000 94 5,303,550 $50,050 to $100,000 0 $100,050 to $200,000 0 $200,050 and over 0 129,099 22,489,050 NORTH DAKOTA $50 to $10,000 109,083 21,472,800 $10,050 to$50,000 124,650 $50,050 to $100,000 1 60,000 $100,050 to $200,000. 0 $200,050 and over 0 169,091 21,657,450 SOUTH DAKOTA $50 to $10,000 188,955 36,342,500 $10,050 to $50,000 16 318,350 $50,050 to $100,000 2 155,000 $100,050 to $200,000 0 $200,050 and over 0 188, 973 36,815,850 wiscoxsix, $50 to $10,000 101, 329 15,103,650 $10,050 to $50,000 6 100,000 $50,050 to $100,000. 0 $100,050 to §200,000 0 $200,050 and over 0 101,336 15,203,650 Grand total 1,301,8*6 242, 0^0,050 SCHEDULE 14.—Fiscal agenfs department. BOND ISSUES DURING YEAR 1918. Quota. Subscription. Allotments. Paid m o e n n t a . llot Balance due. Third Liberty loan.. $105,000,000 $180,892,100 $180,892,100 $180,877,457. 50 $14,042.50 Fourth Liberty loan. 210,000,000 242,046,050 242,046,050 197,034,125.87 45,011,924.13 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. -MINNEAPOLIS. 64^ SCHEDULE 14.—Fiscal agent's department—Continued. BONDS RECEIVED FOR CONVERSION. 3} PER CENT FIRST LIBERTY LOAN COUPON" BONDS. ! Number Denomination.. ! of Amount. i pieces. $50 610 $40,500 $100 : 456 45,600 $500. 27,500 $1,000 ' 26 26,000 ! 1,147 129,000 U PER CENT FIRST LIrtERTY LOAN REGISTERED KOIfDS. $50 $100 165 $16,500 $500 . . 27 13,500 $1,000 - 18 18,000 210 48,000 4 PER CENT FIRST LIBERTY LOAN CONVERTED COUPON BONDS. $50..... 13.219 $660,950 $100.... 11.097 1,109,700 $500.... 1,581 790,500 $1,000.. 1.817 1,817,000 $5,000.. 24 120,000 $10,000. 8 80,000 27.746 4,578, .150 4 PER CENT FIRST LIBERTY LOAN CONVERTED REGISTERED 30NDS. $50 9 $450 $100.... 907 90,700 $500.... 257 128,500 $1,000.. 271 271,000 $5,000.. 35 175,000 $10,000. 27 270, 000 $50,000. 1 50,000 985,650 4 PER CENT SECOND LIHERTY LOAN COUPON BONDS. $50 100,286 $5,014,300 $100 77,288 7,728,800 $500. 11,312 5,656,000 $1,000 16,595 16,595,000 $5,000 1.007 5,035,000 $10,000 ' 463 4,630,000 206,951 44,659,100 4 PER CENT SECOND LIHERTY LOAN REGISTERED BONDS. $50 I 1,134 $56,700 $100.... I 4,607 460, 700 $500.... t 1,200 600,000 $1.000.. i 1,425 1,425,000 $5,000.. 106 530,000 $10,000. 106 1,060,000 $50,000. 12 600,000 8,590 4,732,4.90 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

648 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. SCHEDULE 15.—Bonds delivered to Jan. 1, 1919. THIRD LIBERTY LOAN COUPON BONDS. Denomination. c N f u p m ie b c e e r s . Amount. $50 ' . 804,011 $40,200,550 £100 564,291 56,429,100 $500 36,421 18,210,500 $1,000 27,727 27,727,000 $5,000 1,390 6,950,000 $10,000 1,138 11,380 000 1,434,978 160,897,150 THIRD LIBERTY LOAN REGISTERED BONDS. $50 28,919 $1,445,950 $100. 59,727 5,972,700 $500 7,970 3,985,000 $1,000 3,494 3,494,000 $5,000 196 980,000 $10,000 180 1,800,000 $50,000 22 1,100,000 $100,000 12 1,200,000 100,520 19,977,650 41 PER CENT SECOND LIBERTY LOAN CONVERTED COUPON BONDS. $50 70,074 $3,503,700 $100 65; 157 6.515,700 11,097 5,548,500 $1,000 16,371 16,371,000 $5,000 993 4,965,000 $10,000 740 7,400,000 164,432 44,303,900 4J PER CENT SECOND LIBERTY LOAN CONVERTED REGISTERED BONDS. $50 588 $29,400 $100 2,522 252,200 $500 . . 594 297,000 $1,000 600 600,000 $5,000 72 360,000 $10,000 61 610,000 $50,000 11 550,000 4,448 2,698,600 4J PER CENT FIRST LIBERTY LOAN CONVERTED COUPON BONDS. $50 10,379 $518,950 $100 10,245 1,024,500 $500 1.619 809,500 $1,000 1,859 1,859,000 $5,000 50 250,000 $10,000 21 210,000 24,173 4,671,950 A\ PER CENT FIRST LIBERTY LOAN CONVERTED REGISTERED BONDS. $50.... $1,400 $100... 38,200 $500... 69,500 $1,000. 99,000 $5,000. 100,000 $10,000 110,000 $50,000 50,000 468,100 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 9—MINNEAPOLIS. 649 SCHEDULE 15.—Bonds delivered to Jan. 1, 1919—Continued. FOURTH LIBERTY LOAN COUPON BONDS. Denomination. o N f u p m ie b c e e r s . Amount. $50 471,134 $23,556,700 SI 00 483,695 48,369/500 $500 34,185 17,092,500 $1,000 21,703 21,703,000 $f>,000 1,048 5,240,000 $10,000 782 7,820', 000 1,012,547 123,781,700 FOURTH LIBERTY LOAN REGISTERED BONDS. $50 $341,200 $100 1,934,300 $500 1,376,000 $1,000... 1,101,000 $5,000... 190,000 $10,000.. 350,000 $50,000.. too,ooo $100,000. 300,000 5,692,500 SCHEDULE 16.—War-savings and thrift stamps sales, 1918, through Federal Reserve Bank [Does not include sales made through post offices.] War-savings certificate s T ta h m ri p ft s . Total. stamps. Michigan $185,981.36 $39,783.75 $225,765.11 Minnesota 7,935,024.27 277,499.25 8,212,523.52 Montana 340,565.08 25,470.50 366,025.58 North Dakota 1,806,191.50 57,286.50 1,863,478.00 South Dakota 2,863,364.94 71,151.50 2,934,526.44 Wisconsin 994,507.59 17,994.00 1,012,501.59 Total... 14,125,634.74 489,185.50 14,614,820.24 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

SCHEDULE 17.—Clearing statistics. OS o Clearings. Member and nonmember. Other Reserve Banks. Treasurer of United States. Service charge, Average out-of- number Pate. n d u A a a m v g i e l b e y r e . r] am A ou v n e t r a d g a e i ly. p A a e m v r e o i r t u a e n g m t e . A n d u v a m e i r l b a y g e . e r am A ou v n e t r a d g a e i ly. A am i v t p e e o e r m u a r g n . e t n A d u a a m v g i e l b e y r e . r] , am A ou v n e t r a d g a e i ly. p A a e m v r e o i r t u a e n g m t e . n d A u a a m v g i e l b e y r e . r A a d m v a e o i r l u a y n g . t e A am i v t p e e o e r m u a r g n . e t H e c c q o t h o s u c e t w e a c l n p k n t e s t s o , r , o s l e f d t e n a a r t n t e t i e l m c o y r e s u . i t t > $1,000. > 191S. W January 2,523 $2,016,5 45.19 $799.19 12,001 $1,144,0 49.35 $95.32 941 $1,681,7 57. 84 $1,785.59 383 $116,697.28 $304.60 6.87 1,168 February 2,905 2,049,1 57.27 705.36 12,634 1,092,1 40.50 86.44 917 1,520,4 02. 83 1,656.54 374 101,611.88 271.35 7.78 1,178 & March 2.679 2,301,4 58.51 859. 02 13,494 1,298,3 06.79 96.20 900 1,709,2 49.55 1 898.74 314 84,815. 31 269.33 7.17 1,187 o April 2,475 2,546,0 30.53 1,028. 46 13,610 1,323,3 37.51 97.23 915 1,370,7 66.97 Mil. 74 503 80,071.73 159.13 8.08 1,194 May 2,471 3,141 597.83 1,271.13 13,384 1,453,1 07.35 108. 57 881 1,373,7 78. 50 1,558.66 640 101,065.07 157.83 7.57 1.204 w June 2,566 3,189,5 90. 78 1,243.12 14,369 1,586,2 G6. 69 110.39 889 1,070, 1.15 1,204.69 607 147,405.16 242.73 8.76 1,505 July 2,628 3,329,5 07.89 1,266.63 15,021 1,634 854.68 108.83 887 1,284,5 82.84 1,447.98 700 173,169.27 252.38 8.17 1,320 August 2.727 3,203,4 04. 01 1,174. 61 14,647 1517; 254.45 103. 58 840 1,549.4 09.96 1,842.91 537 171,725.79 319.69 7.57 1,285 September... 2,739 4,296,5 02.96 1,568.35 16,949 1,888,9 57.26 111.46 923 2,203,8 50.99 2,385. 76 778 258,927.59 332.74 6.54 1.304 H October 2,929 6,444,2 37. 72 2,199. 81 19,176 2,408,5 04.74 125.59 1,008 2,243,0 54. 49 2,223.94 1,067 246,587.07 231.03 6.50 1,323 November... 3,421 4,591,0 89. 83 1,341.81 19,866 2,153,9 81.11 108. 42 969 1,538,3 09.28 1,586. 77 1,200 306,605.81 356.41 8.46 1,364 W December 3,883 5 065 776.96 1,304.37 21,549 2,290,8 78.99 106.30 1,150 1,850;8 33.48 1,609.14 1,274 291,127.90 228.37 8.22 1,379 Clearings. Member and nonmember, Other Reserve Banks. Direct to members of Treasurer of United States. Date. other districts. Number. Amount. Number. Amount. Number. Amount. Number. Amount. Number. Amount. 1918. January 65,604 $52,430,175.17 312.028 $29,745,283.32 24,260 $41,663,468.82 228 $2,062,235.17 9,961 $3,034,129.37 ft February 63,912 45,081,460.12 277,950 24,027,091.10 19,969 31,587,524.80 223 1,861,337.56 8,238 2,235,461.49 March 66,979 57,536,462.96 337,364 32,457,669.75 22.176 40.544.759.83 329 2,186,479.04 7,873 2,120,382.92 April 64,356 66,196, 793.97 353,868 34,406,775.47 23,449 33,102,019. 82 362 2,537,921.56 13,089 2,081,865.10 May 64,259 81,681,543.77 347,985 37,780,791.12 22,502 32,233,712.41 414 3,484,528.65 16,649 2,627,691.93 June 64,145 79,739, 769. 61 359,215 39,655,167.46 21,943 24,289,141.17 275 2,476,812.76 15,182 3,685,129.91 July 68,344 86,567,205.19 390,563 42,506,221.83 22,780 30,645,875. 97 286 2,753,277.89 18,200 4,502,401.02 August 73,634 86,491,908.46 395,490 40,965,870.32 22,540 40,052,806.71 160 1,781,262.31 14,503 4,636,596.51 o September 65,748 103,116,071.08 406.795 45,344,974.44 - 22,048 51,163, 770.37 122 1,728, 653. 60 18,676 6,214,262.2S > October 79,095 173,994,418.64 517,767 65,029,628.20 27,034 57,793,454.50 198 2,769,016. 73 28,818 6,657,850.92 November 82,117 110,186,156.12 476,802 51,695,546. 78 23,110 34,820,549.34 157 2,098,873.60 11,493 7,358,539.62 G December 97,092 126,644,424.04 538,743 57,271,974.06 28,580 44.100.510.84 175 2,170,326.33 31,869 7,278,197. 59 Total 855,285 1,069,666,389.13 4,714,570 500,886,994.75 280,391 461,997,594.58 2,929 27,910,725.20 194,551 52,432,508.66 Grand total of items, 6,047,726. Grand total of amounts, $2,112,894,212.32. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

651 DISTRICT NO. 9—MINNEAPOLIS. SCHEDULE 18.—Federal Reserve notes issued by agent during 1913. Fives (new) $11,760,000 Tens (new) 24,280,000 Twenties (new) 18,640,000 Fifties (new) 1,030,000 Hundreds (new) 1,430,000 Total (new) 57,140,000 Fives. Tens. Twenties. Fifties. Hundreds. Total. Held in subtreasury at Chicago. $5,200,000 $1,960,000 $1,840,000 $200,000 $800,000 $10,000,000 Held at Washington (pre pared) or in transit 8,160,000 1,360,000 8,720,000 1,800,000 1,200,000 21,240,000 Being printed at Washington . 5,040,000 7,240,000 9,600,000 400,000 22,280,000 53,520,000 $1,000 bills being printed at 6,000,000 59,520,000 SCHEDULE 19.—Federal Reserve Bank notes. CIRCULATION ACCOUNT CLOSE OF BUSINESS DEC. 31, 1918. Ones. Twos. Fives. Total. Received from comptroller $2,820,000 $992,000 $820,000 $4,632,000 On hand 265, 902 75,952 121,600 463,454 In circulation 2,554,098 916,048 698,400 4,168,546 UNITED STATES SECURITIES WITH TREASURER UNITED STATES TO SECURE CIRCULATION One-year Treasury notes, 3 per cent $530,000 United States certificates of indebtedness, 2 per cent 4,350,000 4,880,010 SCHEDULE 20.—Gold holdings of the bank and the Federal Reserve agent, close of I ness Dec. 31, 1918, as compared to close of business Dec. 81, 1917, Bank, 1918. Bank, 1917. Gold coin $2,172,390 $6,689,000 Gold certificates 6,150,720 8,271,000 Sterling gold account 233,155 2,100,000 Gold settlement fund 23,774,414 19,486,000 Gold redemption fund 4,94^,850 878,000 Total 37,279,529 37,424,000 Agent, 1918. Agent, 1917. Gold coin $3,000,000 $3,000,000 Gold certificates 10,052,000 10,102,000 Gold settlement fund 40,800,000 18,500,000 Gold redemption fund 2,016,410 1,308,000 Total 55,868,410 32,910 000 ' Grand total. 93,147,939 j 70,331,000 Average balance in gold settlement fund of bank during 1918 £15,908,000 A verage balance in sold settlement fund of agent during 1918 39,300,000 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 10—KANSAS CITY. ASA E. RAMSAY, Chairman and Federal Reserve Agent. FINANCIAL RESULTS OF OPERATION. At the beginning of the year 1918 undistributed earnings were shown amounting to $295,759.08. At that time unpaid dividends had accumulated for the latter half of the year 1917, and some depreciation existed in the holdings of United States bonds; conse quently no distribution was made. Gross earnings for the year 1918, as shown in Schedule 1, which is appended hereto, were $3,451,936.13. Current expenses as reflected by Schedule 1 were $689,228.11, leaving net earnings for the year of $2,762,708.02. This, together with undistributed earn ings on hand at the beginning of the }rear, left $3,058,467.10 available for distribution. The depreciation charge of $100,000 against banking premises recently acquired, $6,577.14 miscellaneous depre ciation items, and $220,734 set aside as reserve for depreciation on United States bonds left a net amount available for dividends, surplus, and franchise taxes of $2,731,155.96. Dividends paid for the period July 1, 1917, to December 31, 1918, amounted to $309,729.25; $1,210,713.35 was carried to surplus fund and an equivalent amount set aside in reserve for franchise tax. Reference is made to Schedule 3 for the 1918 balance sheet as of December 31, 1918, as compared to those for December 31, 1917, 1916, and 1915. GENERAL BUSINESS AND BANKING CONDITIONS. Business and banking in 1918 responded to war-time requirements, although handicapped by acute labor shortage, a season of hot and dry weather at midsummer, and an epidemic of Spanish influenza at the end of the year. As a producer of food and other war essen tials, the problem for the Tenth Federal Reserve District was that of bringing production up to market demands, while for the bankers the task was that of providing a sound money market with a plenti ful supply of loanable funds at favorable rates of interest for the proper financing of production and movement to markets. How the district met current requirements may be judged by the annual reports, which show that, all in all, 1918 was the high 653 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

654 AXKUAL REPORT OF THE FEDERAL RESERVE BOARD. record business and banking year of history. The bank clearings of the 15 clearing-house cities of the district, which may be taken as an index to the volume of business, show banking transactions aggregating approximately $17,000,000,000, or about $4,000,000,000 more than the aggregate of transactions in 1917. The district in 1918 sent to its six market cities approximately 26,288,000 meat animals, as against 22,847,000 in 1917, the increase being 1,055,000 cattle, 2,104,000 hogs, and 281,000 sheep, which enabled the meat-packing plants to turn out by far their largest volume of products in any twelve-month period. In spite of a long season of dry weather, which cut down the corn crop to less than 50 per cent of normal, and also affected other crops, the year brought to the six markets of the district the largest movement of grains and foods in any one year. It was also the year of greatest production of coal, lead, zinc, petroleum and by-products, but the poorest year in 20 in gold and silver mining. The volume of mercantile trade was larger than in any other year, despite the fact that dealers were restricted at times by a shortage of stocks. Manufacturing indus tries, save those engaged in producing nonessentials or in work that could wait until after the war, were operated on as high a plane of productive efficiency as was possible under existing conditions. The calling of some 400,000 young men from the district to the colors and the taking of many other thousands of men for work in munitions plants, shipyards, and other war activities were responsible for the great shortage of manpower. Efforts to relieve this situation by shifting men from nonessential to essential employment were only partly successful. Wage increases were readily granted by employers to meet the high cost of living until the wage scale reached the highest level ever known in the district. A few local strikes occurred, but all were settled by arbitration or through the War Labor Board with the exception of a strike of street railway employees in Kansas City. Under these conditions production was maintained on a warwinning basis through the year until in late autumn the influenza epidemic prostrated many thousands of wage earners and their families and caused a slump in productive activity. The vast volume of business which was recorded for 1918 naturally opened up new and larger problems for bankers and called for business and crop financing on a larger scale than anything before attempted. There was at all times of the year plenty of money available for all legitimate business and at no time was the rate increased to check rediscounting made necessary by the unusually high level of prices on all products and the further fact that merchants' and manufacturers' stocks and labor called for vastly more money than ever before to keep business moving. Therefore, the only restrictions laid upon business were physical rather than financial. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 10 KANSAS CITY. 655 DISCOUNT OPERATIONS. The credit transactions of the Federal Reserve Bank of Kansas City represented by advances to member banks for the year 1918 far exceeded previous years, as may be observed in detail from Schedule 4 appended to this report. This result has been due to two primary causes—the demand on the part of member banks growing out of cooperation with Government war financing, and the larger needs of commercial banks to supply productive enterprises, occas ioned by increased costs and higher standard of values. The discount operations, directly and indirectly incident to the cooperation of banks in war financing, have overshadowed the purely commercial credit transactions, although the latter activities have shown a marked increase in volume, as is exhibited by Schedule 4. This schedule provides full classified record and detailed information covering the discount transactions for 1918, which aggregate over $833,000,000, as compared with $237,000,000 of the previous year, all classes of paper showing increased lines. The purely rediscount operations have been almost altogether representative of "commercial paper" transactions, the proportion of bills discounted secured by war obligations being small. These credit instruments, however, were in turn representative of war conditions in that the enterprises financed were in most cases of a character contributory to the winning of the war; essential war industries had, in large measure, the first call on the commercial bankers of the district; and the volume in dollars and cents was augmented by war-time values. Notwithstanding these facts, the commercial paper transactions reflect the business activities of the district within the period because this territory is a producing section, providing for the market at all times commodities essential in times of peace and more especially when war exists, For practical purposes the credit advances styled "member banks' collateral notes secured by Government war obligations" are the index of the extent to which discount operations based upon Liberty loan bonds and certificates were conducted. In this section local conditions make the 15-day paper undesirable for general use commercially, and the operations of the Federal Reserve Bank of Kansas City in this class of paper were, in a large measure, confined to direct assistance to commercial banks based upon war obligations. It will be observed from Schedule 4 of the appendix that the aggre gate transactions represented by advances on account of war ob ligations amounted to almost $500,000,000 within the year, and multiplied several times the experience of the previous year. De mands of this character from commercial banks have fluctuated as immediate needs recurred and declined, and the discount facility has helped materially to supply expeditiously and with equitable pro Digitized for FRASER portion from this district the funds required by the Government. http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

656 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. TRADE ACCEPTANCES. While the use of the trade acceptance has not grown to any consid erable extent in this district, transactions in this class of paper are occurring more frequently. The trade acceptance is not altogether unknown in the credit instrument field of this section, but the offer ings submitted to this bank are mainly representative of the produc tion and sale of oil, or in some cases of the cotton industry, rather than of changed methods on the part of the mercantile establishments growing out of the educational program of credit men and large wholesale and industrial concerns. ACCEPTANCES. The acceptance in its true character is not generally used in the business activities of the Kansas City district. There are exceptional occasions promoting inquiries from time to time in particular lines of industry, and in a few instances the adoption of the bankers7 accept ances covering domestic transactions of larger concerns in this territory. The volume of bankers' acceptances originating within the tenth district has been proportionately small, but the number of transactions representing the offering of this class of paper by local member banks is showing some increase. The management of the Kansas City Bank has continued its policy of participating from time to time in open-market acceptance transac tions, both foreign and domestic, with the Federal Reserve Bank of New York, and periodically with the Federal Reserve Bank of Boston. When local demand requires the conserving of reserve funds, these purchases are discontinued. Schedule 5 provides a record of openmarket transactions in bankers' acceptances. RESERVE POSITION. The average reserve for the year 1918 has at all times been consider ably in excess of the legal requirements, although reduced from the 1917 record, as indicated by Schedule 9, the yearly average for 19i8 being 55 per cent as compared with 70 per cent for 1917. This was a natural consequence of increased operations and heavier demands, which have been handled expeditiously and met promptly. Large credit lines requested by a limited number of banks at certain seasons of heavy demand have caused a temporary decline from the general average reserve status. MOVEMENT OF MEMBERSHIP. During the past year there was a net increase of 33 member banks within the district, the membership now being 994, of which 239 are within the Omaha branch district and 139 are served by the Denver branch. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 10—KANSAS CITY. 657 Within the year 23 national-bank charters were granted in this district, which, with eight consolidations and liquidations, made a net increase of 15 national-bank members. In 1915 but one trust company and two State banks applied for and were granted membership in this institution and no State-bank members were added in 1916. At the end of 1917 two trust com panies and seven State banks located in four States were enrolled as members, Oklahoma, New Mexico, and Wyoming being without a State-bank or trust-company member of District No. 10. Four Oklahoma State banks became members of the Federal Reserve Bank of Kansas City in 1918, including the largest State bank of that State. New Mexico added one State-bank member to this district and another application is pending at the close of the year. In Wyoming, the only State not now represented, the laws are unfavorable to the membership of State banks, and it is hoped that the coming legislature will pass necessary amendments to the State banking laws. Seven State banks from Nebraska, one State bank and one trust company, both of Denver, Colo., were added, which new memberships were undoubtedly due to the opening of the branch bank at Denver and the operation of the branch bank at Omaha. With two new members added from Kansas and two from Missouri, 18 State banks and trust companies in this district joined the Federal Reserve system in 1918. Since the organization of the Federal Reserve system there never has been a failure of a member bank in this district. Reference is made to the movement of membership for the past year in Schedule 10 of this report. RELATIONS WITH NATIONAL BANK MEMBERS. The cordial relation with executive heads of member banks has been strengthened by the activities of the past year. The strength of the system, the necessity for its facilities, and the direct benefit and protection of financial interests has been demonstrated to the individual banker in his own transactions. The measure of coopera tion resulting in a practical way has been noticeably distinguished from any mere support based upon theory or principle. The opera tion of this institution in all its functions has, in the main, been conducted with the support and encouragement of the member banks. There continue to be cases of neglect to maintain proper reserve balances, as exhibited by the appendix, notwithstanding the penalties assessed, based upon a progressive rate in effect during the year 1918. The necessity to maintain these balances intact at all times is being brought home to delinquent member bankers by conference and correspondence, in addition to the corrective feature of the penalty assessment. Digitized for FRASE1R00 823°—19 42 http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

658 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. It has been the policy of the directors and officers of this bank to accord to members every facility and service which can be consist ently given, even to the extent of absorbing incidental costs where practicable. This policy has gone far toward producing a more thorough understanding on the part of members that the privileges of membership in a practical way, and in addition to the general benefits, are as marked as its obligations. With a larger number of banks availing themselves of the discount facilities, and with the greater volume of transactions, there has been a wider opportunity to clearly define eligible paper and to influence the preparation of credit instruments in the district along lines which will more clearly distinguish liquidity, security, eligibility, and essential credits. The opportunity afforded this bank within the year 1918 to extend aid to sections of the district where drought conditions affected the productivity thereof, and taxed worthy financial institutions, has also strengthened the relations with banks of those sections. The directors and officers of this bank have given serious consider ation to a condition attending increasing discount operations where member bankers, in some instances, have apparently been prompted by profit considerations to use the facilities of the Federal Reserve Bank as an outlet for paper sought by them at a higher rate from sources not naturally tributary to their banks. Provisions have been made to discourage and control this practice. FIDUCIARY POWERS. From the time of the establishment of the Federal Reserve system to the close of the year 1918, 64 national banks in this district were granted permission by the Federal Reserve Board to act as trustee, executor, administrator, and registrar of stocks and bonds, under section 11 (k) of the Federal Reserve Act, and two national banks were granted these powers, together with additional powers under the amended act approved September 26, 1918. Of the banks granted fiduciary powers 20 are located in Colorado, 11 in Kansas, 9 in Missouri, 8 in Nebraska, 1 in New Mexico, 8 in Oklahoma, and 9 in Wyoming. Sixteen of these applications were granted during the year 1918. Since the passage of the Phelan Act, which gives other fiduciary powers to national banks, more interest in the granting of these powers is indicated by recent inquiries. However, but two banks granted fiduciary powers under the former act have made anplication for the additional powers under the amended law. RELATIONS WITH STATE BANKS AND TRUST COMPANIES. The relations of this bank with State institutions have been very cordial since it was authorized to accept from member banks paper Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 10 KANSAS CITY. 659 discounted with them by nonmember banks when secured by Liberty bonds or certificates of indebtedness, and it has received splendid cooperation from State institutions in all matters wherein the banks generally were called upon to assist in financing the Government's needs for war purposes. When the appeal was made to banks to send their gold coin and gold certificates to the Federal Reserve Bank the State institutions responded very liberally. More than 2,000 nonmember banks in this district are clearing at par the items of this bank, and there has been more than $2,000,000 redeposited by the fiscal agency with 262 nonmember banks. While the length of time these funds remained on deposit with nonmember banks was not long, yet it was the means of bringing the Federal Reserve Bank and the State institutions into closer contact, and they are more impressed now with the real service which the Federal Reserve Bank can perform for them than ever before, and it is believed that as soon as the various legislatures amend their banking laws to permit State institutions which become members of the Federal Reserve system to operate on the same reserves as national banks, membership will be materially increased. The bank has been very liberal in handling the bills receivable of State banks and trust companies when offered by member banks where it was reasonably sure that the agricultural, industrial, or commercial interests of the communities represented by the notes were in need of the proceeds, but it has not hesitated to return such paper when it was apparent that the member bank offering it had taken it solely for the profit resulting between the Federal Reserve Bank's rate and the rate at which it discounted it. It has not been felt necessary to examine any State bank member for the reason that the various States of this district have wellorganized banking departments and competent examiners. The bank commissioners of three of the States in this district are requiring the examiners to use the forms approved by the Federal Reserve Board for the examination of State bank members; the others state that it would entail considerable cost to change their office records to conform to these forms, but express the hope that in the near future arrangements can be made whereby the examination of all banking institutions will be uniform, and we have the assurance of their cooperation to this end later on. The bank commissioners of all the States in this district permit the State bank members to count their balances with the Federal Reserve Bank as a part of their legal reserves. FISCAL AGENCY OPERATIONS. The Government's requirements for war activities during the year 1918 met with commendable response from the citizens of the district. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

660 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. With the exception of the sale of war-savings stamps, over which the governors of the Federal Reserve Banks were not requested to take jurisdiction until practically the close of the year, other Gov ernment securities have been sold by campaigns conducted by a central organization, organized and conducted under the direct supervision of the governor's office of the Federal Reserve Bank. Treasury certificates of indebtedness anticipatory of the third Liberty loan were sold in the district in the amount of $128,524,500, against aggregate quotas assigned by the Treasury Department of $116,000,000. Schedule 19, appended hereto, reflects the distribution. Certificates anticipatory of the fourth loan was sold in the district in the amount of $176,866,000, against aggregate quotas assigned by the Treasury Department of $164,000,000. Schedule 20, appended hereto, reflects the distribution. Practically all of the large banking institutions and a great number of the smaller ones throughout the district qualified as special Gov ernment depositaries for war loan deposits, and a large percentage of payments for certificates and bond sales was made through this medium, as is reflected by Schedules 21, 22, 23, 26, and 27. Many qualified depositaries expressed disappointment on account of the very rapid withdrawals of funds, notwithstanding repeated advices to them that this method of payment was only an expedient resorted to for the purpose of affording temporary relief of short duration, opportunity thus being given to make preparation for the required payments. The Liberty loans were placed through the same central organiza tion handling other Government securities, under the direction of the governor's office of the Federal Reserve Bank. State campaign organizations were formed, each State being subdivided into districts containing a number of counties, varying as to conditions and trans portation facilities. Sales of bonds of the third loan were made in amount of $204,092,800, against quota assigned by the Treasury Department of $130,000,000. Sales of bonds of the fourth loan were made in amount of $295,951,450, against quota assigned by the Treasury Department of $260,000,000. The distribution, as will be seen from Schedules 24 and 25, appended hereto, is very gratifying. Of the entire population of the district, 16 per cent subscribed to the third loan and 17.6 per cent to the fourth loan. In addition to the sale and delivery of bonds of the third and fourth loans aggregating $500,044,250, approximately 100,000 requests for conversion have been handled during the year, more than 450,000 bonds having been surrendered, aggregating an amount in excess of $125,000,000, and exchanges of bonds have been made in an aggregate amount of $11,500,000. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO, 10—KANSAS CITY. 661 The Federal Eeserve Bank was not impressed in the selling cam paigns for war-savings stamps until practically the close of the year. It served as custodian and redemption agent principally, and in this connection the Federal Reserve Bank of Kansas City sold and delivered war-savings stamps and thrift stamps (not including stamps in the hands of agents of the second class) as follows: 7,184,213 warsavings stamps, maturity value, $35,921,065; 3,031,028 thrift stamps, maturity value, $757,757. A postal substation is conducted in the fiscal agency department of the bank and has proven to be a great convenience. The total number of registered shipments handled during the year lor the department proper was 104,746, in addition to which the station handled for the general public a total of 2,139 C. O. D. and insured packages and made sales of stamps aggregating $28,753.03. The War Finance Corporation established a cattle loan agency at Kansas City in October to serve Federal Reserve Districts Nos. 8, 9, 10, and 12. Operating details were consummated early in November and were discontinued in December. Ninety-two applications for loans, aggregating $4,799,696.58, were considered, of which 19, aggregating $1,765,187.94, were approved. The district committee on capital issues had constantly before it about 200 applications, aggregating probably $20,000,000, due to the rapid development of the oil, gas, and mining industries of the district. This large number of applications coming before the com mittee required semiweekly meetings. The aggregate amount of applications refused and discouraged was about $500,000,000. FEDERAL RESERVE NOTES. The circulation of Federal Reserve notes at the end of 1918 was more than double the amount outstanding at the end of 1917. At the close of 1918 this bank had received from the Comptroller of the Currency Federal Reserve notes to the amount of $155,700,000, of which $76,960,000 were received during the past year, an increase of practically 50 per cent over 1917. Immediately following this bank's general letter of October 24, 1918, in which it advised member banks of its policy to absorb costs incidental to shipments of currency, there was a very free movement of Federal Reserve notes to the Federal Reserve Bank. Of the notes received there was a sufficient amount fit for circulation to more than offset shipment demands. Between the dates of October 25, 1918, and December 11, 1918, no notes were delivered to the bank proper. During the year, however, only $1,660,000 in notes was returned by the bank to the agent, as compared with a total amount of $10,435,000 withdrawn from actual circulation in the same manner during the previous year. In addition to keeping the customary supply of approximately Digitized for FRASER http://fraserd.ts.1t lrov uri\sr\rf\e d.ro\r\rr\g / 1 J 1 -J.1 _1 __.._- . 1* J J HI T Federal Reserve Bank of St. Louis

662 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. and Washington, a supply of $5,000,000 of Federal Reserve notes is constantly maintained with the Denver mint for the convenience of the Denver branch. Detailed statements with reference to Federal Reserve notes, including the issuance, redemption, and expense, are to be found in Schedules 13, 14, 15, and 16 of this report. FEDERAL RESERVE BANK NOTES. The demand for $1 and $2 bills since the call for retirement of $1 and $2 silver certificates has been met in this district by the issuance of Federal Reserve bank notes secured by one-year United States certificates of indebtedness. At the close of the year the bank had an actual outstanding Federal Reserve bank note circulation of $11,448,481, which includes $8,000,000 in circulation at the close of 1917. POSITION OF COMMERCIAL BANKS AS A RESULT OF WAR FINANCING. The comparative statements at the close of this year and last exhibited in schedules accompanying this report reflect a showing of member banks' obligations which may be taken as a general index to extension of credits throughout the district incidental to war finan cing and accentuated by the prevailing high prices of commodities. It is impractical to obtain accurate information as to the amount of credits directly attributable to war financing, as many obligations of customers to commercial banks are the result of customers' pur chases of Government securities, and, unless loans are secured by the securities purchased, reports from banks will not indicate the true nature of the loan. War financing has had the effect of narrowing the market for commercial paper in the district due to two related causes—first, the diversion of funds to loans to customers for purchasing Govern ment securities, and second, the outside markets for cattle paper emanating from this district have been somewhat narrowed, making it necessary for the district to absorb larger amounts of its own paper than has generally been the custom heretofore. General business conditions throughout the year have been good. The fact that the district is principally agricultural and live-stock producing, both of which are classed as imperative war necessities, resulted in increased production at higher prices. The industries of the cities were largely diverted to war contracts, and while this business may be said to be comparatively small in volume, the enterprises have been satisfactorily profitable. POLICY TO BE PURSUED IN RESTORING LIQUIDITY OF BANKS. The winter wheat crop to be marketed in the spring and the cattle which will come on the market at that time will have a tendency to ease the situation to some extent, but this will be largely offset by the fifth Liberty loan to be sold at that time. With fair crops, Digitized for FRASER ^^-r-»oii /-l/-\-r»oVvl e\ 1 i/-*-i-i i rl o -f mn onAnln no -nAooima in +no Tall rvr 1 Q1 Q http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 10 KANSAS CITY. 663 The policy of the Federal Reserve Bank must obviously be liberal in necessary conditions, but interest rates should be held firm and incline upward in order to prevent the already apparent tendency for banks to extend themselves imprudently for new business and profits. With the Government guaranty of price for wheat and the abnor mally large acreage which has been seeded, and with the present ideal weather conditions, the feeling is justified that next year should help materially in restoring the liquidity of banks in this district. OPERATIONS OF FEDERAL RESERVE BANK BRANCHES. Two branches of the Federal Reserve Bank of Kansas City are in operation, located, respectively, at Omaha, Nebr., and Denver, Colo. The Omaha branch began active business in September, 1917, and the Denver branch within the year 1918. The volume of business transacted at each of these points indicates that the service provided for member banks in the territory tributary to each has been of value to these respective territories. The member banks in both subdistricts have accorded the branches hearty support during the year, and have in turn benefited by increased and more accessible facilities. All current and ordinary transactions for member banks in the States of Nebraska and Wyoming are handled at Omaha, and those for member banks in the States of Colorado and that portion of New Mexico within the tenth district are handled at Denver. The operation of the branches is under the direct control and supervision of the head office, and reports are made daily, or less frequently, as the nature of the transactions requires, to the head office for approval. The policies formulated by the management of the Federal Reserve Bank of Kansas City are closely followed at the branches, and the operations of the institutions are coordinated and harmonized. Mining, agriculture, and stock raising are the chief industries of the branch districts. OMAHA BRANCH. The operation of this institution was well under way at the begin ning of the year 1918. The officers and directors are as follows: O. T. Eastman, manager; E. D. McAllister, cashier; Luther Drake, director; P. L. Hall, director; J. C. McNish, director; R. O. Marneli, director. The business transactions of the branch in every department have increased in volume within the year by reason of war conditions and the activities of industries contributory thereto. Discount transac tions were at a maximum directly following the floating of the Liberty loans, but have decreased steadily since that time, indicating. the ability of the district to absorb its investment in Government securi ties. The total membership tributary to the Omaha branch is 239, Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

664 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. 68 per cent of the membership having engaged in discount trans actions, an increase of more than one-third within the year 1918. The added volume of business has necessitated a considerably larger force of employees proportionate to the increased service rendered to the banking institutions and business interests of the territory. The directors of the branch meet monthly, the supervision of operations in the interim being charged to the discount committee, which reviews for approval the current offerings of member banks. General conditions in the Omaha territory have been on the whole fairly satisfactory, the oil industries in Wyoming developing, the live-stock interests in the mountain regions enjoying prosperous con ditions, the agricultural products being about normal in the southern half of Nebraska, and better in the northern half. DENVER BRANCH. The Denver branch was opened for business on January 14, 1918, operating on a modified plan, more as an office or agency of the Kansas City Bank, until experience developed that the distance from the head office and the two days' time intervening made the con tinuance of that plan impracticable. On April 1 the accounts of member banks in territory served by the Denver branch were trans ferred to that institution, and its powers were so altered as to place its operation in the same class as that of the Omaha branch. Banks of this subterritory have enjoyed an increased and profitable business, the prosperous condition of the agricultural and live-stock industries having been reflected in augmented bank deposits. The demand for money has been greater than heretofore, and while rates have shown a firmer tendency during the year, advances were moder ate and reasonable. Many banks within the Denver territory un accustomed to rediscount transactions have resorted to the facilities provided for them within the year 1918, partly on account of in creased agricultural demands, and more especially because of the cooperation of the banks and their customers in Government financ ing. When the Denver branch began business there were 134 member banks tributary to this institution, and the present number is 140. The State bank membership is small and the number of eligible State banks limited. As a result of war financing, the obligations of member banks for borrowed money, directly and indirectly, have been larger than heretofore, and the commercial paper purchased by the banks has declined in volume. In general, the legitimate demand of customers has been met as usual. The board of directors is as follows: Alva Adams, Pueblo; C. A. Burkhardt, Denver; John Evans, Denver; A. C. Foster, Denver; C. C. Parks, Denver. Regular meetings of the directors are held monthly, a discount committee meeting daily to supervise the operation of Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 10—KANSAS CITY. 665 the branch and pass on offerings for discount. The officers of the branch are C. A. Burkhardt, manager, and P. R, Fredman, acting cashier. MISCELLANEOUS. INTERNAL ORGANIZATION. The personnel of the directorate remains unchanged from 1917, except in the case of the chairman of the board; the term of Mr. Charles M. Sawyer as class C director expired with the close of 1917 and Mr. Asa E. Ramsay was designated as his successor and ap pointed chairman of the board and Federal Reserve agent. Messrs. Burnham and Gibson, classes A and B directors, respectively, were reelected to succeed themselves. The official staff was reelected for the year 1918 as follows: E. F. Swinney, member of the Advisory Council; J. Z. Miller, jr., governor; J. L. Cross, deputy governor; Arch W. Anderson, secretary-cashier; C. A. Worthington, assistant cashier; M. A. Thompson, assistant cashier. C. K. Boardman was reappointed assistant Federal Reserve agent. On June 27 Mr. E. P. Tyner, formerly chief clerk of the bank, was designated acting assistant cashier. Effective October 1, Mr. M. A. Thompson resigned as assistant cashier to accept a position with a local commercial bank. The following members of the clerical force were designated acting assistant cashiers on September 12: J. W. Helm, L. H. Earhart, John Phillips, jr. With the additional func tions incident to the increased volume of business and to war-time conditions the organization has increased proportionately, and, with the fiscal agency department, now includes over 400 employees, ex clusive of the branches. The acting assistant cashiers have each been charged with the immediate detail supervision of the work of certain departments, all departments being in charge of an experi enced department head. The senior officers have regular morning conferences with respect to policies and current matters of importance. The junior officers meet periodically with one or more of the senior officers for discus sion and instruction on points of general interest. The auditing work of the various departments and branches has been centralized for purposes of supervision under S. A. Wardell, acting auditor, at the main office. Notwithstanding the increase of operations, the scarcity of trained help, and the necessity of engaging inexperienced clerks, the work of the bank has proceeded satisfactorily and the general clerical organization has performed its functions with an increasing degree of coordination and efficiency. The executive committee continues to meet daily to pass upon discount and investment operations, and, within the period between regular meetings of the board of directors, matters of executive Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

666 ANNUAL, REPORT OF THE FEDERAL RESERVE BOARD. policy. The proceedings of executive committee meetings are re viewed by the board of directors at its regular sessions for approval. The directors meet on the second and fourth Thursday of each month, and the member of the Advisory Council from time to time attends the board meetings. The meetings are well attended by the directors, who, individually and collectively, give expression to their sincere interest in all matters affecting the operation of the bank and the welfare of the system. CLEARINGS. The growth and development of the clearing operations of this bank, commented on in the annual report for last year, are far over shadowed by the experience of the year 1918. The discontinuance altogether of the service charge previously made for the collection of cash items became effective on June 15, and the volume of items together with the average amount per item began at once to show a marked change, the former increasing and the latter decreasing. Detailed information covering the year's operation is given in Schedule 18. Within the year 1918 more than 700 par banks have been added to the list for the tenth district, so that items are now handled at par on approximately 3,200 banks within this district, there being about 1,000 institutions not represented on the Federal Reserve par list. From an average of 12,000 to 14,000 items daily, handled by the Kansas City office in the early part of the year, the present business of the clearing department comprises an average of about 50,000 items daily, aggregating approximately $20,000,000. The increased volume of clearing business has been proportionate at the Omaha and Denver branches. At the beginning of the year the Kansas City office and the Omaha branch were handling 18,000 items daily, aggregating around $20,000,000, whereas at the close the head office with the two branches now clear 70,000 items daily, amounting to about $28,000,000. Local checks and drafts presented by the Federal Reserve Bank through the Kansas City Clearing House have increased from a daily average of approximately 3,500 items to 5,000 or more, and the aggregate amount thereof is 40 per cent to 50 per cent larger than at the beginning of the year. Schedule 18 of the appendix provides in detail a recapitulation of city and country clearings, and a classified record of the business handled, with sta tistical data, both for the head office and the two branches, sepa rately and combined. The work of the transit department of this bank is under the super vision of an acting assistant cashier, and as the volume has increased the department has been subdivided into divisions, each with a com petent head. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 10 KANSAS CITY. 667 COLLECTIONS. Within the year 1918 it developed that the use of the collection facilities provided for maturing bills and notes, and items of like character, is necessitating provision for handling this class of busi ness in larger measure than had been anticipated. With the begin ning of the year, collections reaching the Federal Reserve Bank of Kansas City were infrequent, but about 75 such items are now handled daily. The increase in this business, with the prospect of still further development, has made necessary the consideration of service; and the scope of the collection department, together with facilities for prompt and accurate accounting, is being enlarged. GOLD SETTLEMENT FUND. The method of settling balances as between Federal Reserve dis tricts through the gold settlement fund has continued to benefit the banking and business interests of this district, especially since the adoption of the daily settlement on July 1, 1918. This method of settlement has been noticeably effective in providing a means of transferring credit in war financing times without cumbersome, ex pensive, and unsatisfactory transfers of the actual funds. Since the inauguration in June, 1918, of the private-wire system connecting all Federal Reserve Banks, their branches, and the Fed eral Reserve Board, the volume of telegraphic transfers with other Federal Reserve districts has developed in large degree, and ex peditious settlement of balances has been provided only by the operation of the gold fund. Time and use have demonstrated that the principle underlying this plan is thoroughly practicable, and its advantage to the tenth district has been marked by reason of seasonal ebb and flow of funds and credit as between this section and the East. FOREIGN ACCOUNTS. The Federal Reserve Bank of Kansas City has no foreign accounts, but in 1917 it participated with the Federal Reserve Bank of New York in acquiring foreign earmarked gold, by means of payments made in this country for foreign accounts. The balance held at the close of 1918 is $291,443.73, a decrease of $2,333,556.27 within the year. BANKING QUARTERS—NEW BUILDING. In the 1917 annual report of this bank it was stated that informal consideration had been given to the erection of a proper banking house, because of the fact that present quarters are inadequate in space and arrangement, and that it is necessary to house depart ments of this institution in separate buildings. The volume of business handled in 1918 and the largely increased clerical force has made necessary almost continual alterations and rearrangement and the securing of still further quarters removed from the main office. The institution necessarily operates under handicap and with hazard. On January 24 a committee was appointed to investigate the matter Digitized foor fF RsAeScEuRr ing a proper location, which resulted in the purchase on http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

668 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. July 11 of a well-located plot, 144 by 115 feet. The building com mittee was continued, pending arrangement for the erection of suit able premises, and since conditions have made it possible to anticipate the securing of sufficient material and labor, the committee on November 22, after conducting a hearing with architects, entered into an agreement for the preparation of plans and supervision of the erection of a building with Messrs. Graham, Anderson, Probst & White, of Chicago. Preliminary plans are in preparation, and it is contemplated that the building will be erected with a view to pro viding ample space and proper equipment for present needs of all departments, and provision for such natural increase of business as may be anticipated. EXHIBIT A.—Movement of principal earning assets of the Federal Reserve Bank of Kansas City during the calendar year 1918. [In thousands of dollars; i. e ., 000 omitted.] Discounted s S e t U c a p u t n a e r i p s e t d e e w r d b a y r dis p O c a o t p h u e e n r * . t ed (1+2) m i b n o B a o u r i k l p g l e s e h n t t . d T i b o s o c t a a u o n l g u d b h n i t t l . e l d s Pe ( r 1 - c 5 e ) n t. e a a T s r o s n e t i a t n s l g . obligations. 1 2 3 4 5 6 7 3,364 32,120 35,484 544 36,028 9.3 50,561 Jan. 11 3,015 29,858 32,873 32 32,905 9.2 47,551 Jan. 18 2,449 27,069 29,518 35 29,553 8.3 44,199 Jan. 25 2,519 30,026 32,545 35 32,580 7.7 47,226 Feb.1 3,450 31,852 35,302 29 35,331 9.8 50,176 Feb. 8 4,304 28,277 32,581 27 32,608 13.2 46,897 Feb. 15 1,477 16,120 17,597 1,494 19,091 7.7 33,019 Feb. 21 1,680 17,131 18,811 1,489 20,300 8.3 33,615 Mar. 1 1,512 15,013 16,525 1,481 18,006 8.4 31,226 Mar. 8 1,846 18,913 20,759 6,519 27,278 6.8 40; 441 Mar. 15 2,229 20,349 22,578 6,165 28,743 7.8 41,796 Mar. 22 2,983 21,087 24,070 6,150 30,220 9.9 43,143 Mar. 29 5,911 26,427 32,338 13,806 46,144 12.8 59,237 Apr. 5 7,663 27,556 35,219 13,470 48,689 15.7 61,465 Apr. 12 11,684 24,984 36,668 13,223 49,891 23.4 62,618 Apr. 19 12,866 26,211 39,077 10,391 49,468 26.0 63,069 Apr. 26 14,984 28,928 43,912 7,132 51,044 29.4 64,672 May 3 21,155 25,249 46,404 3,507 49,911 42.4 63,490 May 10 19,845 31,480 51,325 2,604 53,929 36.8 67,400 May 17 20,560 48,507 69,067 2,041 71,108 28.9 84,428 May 24 21,185 50,392 71,577 1,446 73,023 29.0 86,308 May 31 15,627 49,836 65,463 635 66,098 23.6 78,669 June 7 16,010 52,140 68,150 600 68.750 23.3 81,228 June 14 16,358 45,692 62,a50 600 62,650 26.1 75,150 June 21 13,146 43,466 56,612 250 56,862 23.1 69,327 June 28 12,166 44,230 56,396 250 56,646 21.5 67,265 July 5 14,516 46,231 60,747 3 60,750 23.9 71,163 July 12 12,199 50,654 62,853 70 62,923 19.4 73,017 July 19 12,630 56,230 68,860 129 68,989 18.3 79,084 July 26 17,491 60.764 78,255 129 78,384 22.3 88,519 Aug. 2 19,307 58,285 77,592 159 77.751 24.8 87,899 Aug. 9 19,541 52,269 71,810 129 71,939 27.2 82,114 A A A N N N N N S S S S O D O O O D D D e e e e u u u o o e c e e e o o c c c o p p p p c c c c t g t t g t g v v v v v . . . . . . . . t t t . . . t . . . . . . . . . 2 4 1 1 6 1 2 2 3 2 1 1 2 1 1 2 2 6 1 2 5 8 0 3 0 7 0 3 5 6 2 1 9 0 3 7 3 3 3 3 3 2 1 1 2 2 2 2 2 2 2 1 2 1 2 2 3 0 7 2 2 1 5 8 6 2 8 8 9 9 7 9 3 7 7 3 , , , , , , , , , , , , , , , , , , , , 8 7 3 9 0 9 3 0 3 9 9 6 3 3 1 5 8 8 2 2 0 6 5 2 3 7 4 8 9 4 0 7 9 5 9 0 5 2 7 4 4 2 7 0 1 1 4 6 9 7 9 0 0 5 5 8 0 0 5 5 3 3 4 4 4 4 5 3 4 4 4 4 4 4 5 4 4 4 4 4 9 6 7 1 8 4 4 5 8 7 7 2 1 3 5 9 3 2 1 7 , , , , , , , , , , , , , , , , , , , . 0 8 7 5 8 4 1 1 8 1 6 0 2 1 4 7 5 0 9 7 8 1 4 9 3 6 0 8 1 5 2 5 4 2 6 4 4 8 6 7 4 4 2 9 1 3 3 3 3 8 6 3 3 5 0 0 2 2 5 8 8 6 8 8 6 5 5 6 7 8 8 7 7 7 5 5 7 7 7 6 0 2 0 1 6 9 7 3 5 9 8 1 0 9 6 0 3 1 7 9 , , , , , , , , , , , , , , , , , , , , 3 1 8 4 3 7 8 5 5 0 2 9 6 4 0 3 1 3 1 8 9 3 4 3 0 8 9 7 4 6 5 3 3 8 0 8 3 9 5 3 4 4 6 7 4 9 7 0 1 3 3 5 5 6 5 0 8 8 5 2 1 1 8 9 1 5 6 6 8 9 7 9 0 4 , , , , , , , , , , , , 5 6 2 3 0 5 7 9 4 8 2 4 1 1 1 2 1 1 1 1 4 1 1 0 2 7 8 9 4 9 2 0 2 3 2 7 3 3 3 3 7 3 2 4 7 6 8 3 2 5 2 3 9 6 9 0 6 6 6 3 8 9 9 8 6 8 8 8 8 7 6 5 5 7 7 7 6 6 7 7 0 6 0 0 3 9 4 7 2 0 9 9 6 7 7 9 9 5 3 1 , , , , , , , , , , , , , , , , , , , , 2 1 2 9 0 2 1 4 4 7 6 8 5 4 5 3 0 1 9 3 1 4 0 4 8 5 2 6 2 6 2 7 7 1 0 9 1 7 4 2 7 8 9 6 3 9 7 1 2 8 3 3 5 8 1 9 0 1 0 2 3 3 3 3 3 3 3 3 3 3 3 3 2 2 4 4 2 2 2 2 9 0 8 8 8 6 4 6 4 9 8 3 3 4 4 0 8 8 8 8 . . . . . . . . . . . . . . . . . . . . 7 6 6 2 3 4 4 4 5 1 9 3 8 6 6 0 6 9 5 2 1 1 1 9 9 9 7 8 8 8 9 9 9 8 8 7 7 6 6 9 0 0 0 3 2 7 4 4 2 4 1 7 5 2 1 2 7 2 6 9 2 0 8 , , , , , , , , , , , , , , , , , , , 0 3 0 5 1 5 1 5 3 7 5 2 6 1 6 1 8 8 1 0 2 8 6 4 5 1 2 2 2 9 3 1 3 0 9 8 3 7 9 9 4 4 4 4 2 3 5 8 9 0 8 0 5 0 8 6 6 2 3 5 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 10—KANSAS CITY. 669 FEDERAL RESERVE BANK OF KANSAS CITY MOVEMENT OF EARNING ASSETS ! DURING THE CALENDAR'YEAR1918\ 1 Curre/: WarjGbanShner. Gzri^Z:JStalSilljX^iscouneed. <Urrc3;J8tUs Discounted andJBbught\ a Curt>e4:3o6nl£fcnzn4J!ss6ts, incl. U.S. Government Securities. CUrveS.Sratio ofTVar^banJhjier toJotalJBiZls Discounted andJjought. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

670 ANNUAL REPORT OF THE FEDERAL, RESERVE BOARD. EXHIBIT B.—Movement of cash reserves, net deposits, Federal Reserve note liabilities, and the reserve percentage of the Federal Reserve Bank of Kansas City during the cal endar year 1918. [In thousands of dollars; i. e., 000 omitted.] Ratio of cash re Federal serve to net T r o e t s a e l r v c e a s s . h dep N o e s t its. a R n ct o e u t s e a e s l r c v in i e r (2+3) de R F p e e o s d s e e it r r v a a e l n d culation. ! note liabil ities com bined. 1 1 2 3 4 5 Jan. 4 85,120 68,894 55,585 124,479 68.4 Jan. 11 80,130 59,547 56,817 116,364 68.9 Jan. 18 76,414 53,440 55,852 109,292 69.9 Jan. 25 77,574 58,161 55,278 113,439 68.4 Feb. 1 79,102 t 62,693 55,196 117,889 67.1 Feb.8 81,782 60,164 57,084 117,248 69.8 Feb. 15 85,711 49,883 57,416 107,299 79.9 Feb. 21 94,753 58,180 58,719 116,899 81.1 Mar. 1 99,144 57,993 60,912 118,905 83.4 Mar. 8 88,580 ! 51,775 65,707 117,482 75.4 Mar. 15 95,398 59,298 66,300 125,598 76.0 Mar. 22 90,054 54,300 67,271 121,571 74.1 Mar. 29 84,476 63,629 68,392 132,021 64.0 Apr. 5 84,798 65,315 69,314 134,629 63.0 Apr .12 77,561 58,166 70,222 128,388 60.4 Apr. 19 79,427 59,735 70,913 130,648 60.8 A_pr. 26 82,690 64,224 71,330 135,554 6^.0 May 3 81,994 62,990 70,531 133,521 61.4 May 10.... 86,871 70,591 71,741 142,332 61.0 May 17 62,600 62,795 72,112 134,907 46.4 May 24 64,438 66,375 72,299 138,674 46.5 May 31 69,671 63,393 72,854 136,247 51.2 June 7 63,606 59,127 73,374 132,501 48.0 June 14 69,048 58,102 73,627 131,729 52.4 June 21 77,200 59,937 74,186 134,123 57.6 June 28 63,447 44,093 74,396 118,489 53.5 July 5 62,744 45,599 75,871 121,470 51.7 July 12 69,827 53,765 76,553 130,318 53.6 July 19 64,739 53,381 77,938 131,319 49.3 July 26 73,233 70,290 78,761 149,051 49.1 Aug. 2 64,724 59,058 80,858 139,916 46.3 Aug. 9 66,091 52,878 82,666 135,544 48.8 Aug. 16 77,883 58,198 84,358 142,556 54.6 Aug. 23 80,925 55,667 85,958 141,625 57.1 Aug. 30. 84,611 53,734 87,997 141,731 59.7 Sept .6 83,700 48,546 90,500 139,046 60.2 Sept. 13 80,116 50,449 92,850 143,299 55.9 Sept. 20 81,381 55,088 95,386 150,474 54.1 Sept. 27 87,168 61,640 97,350 158,990 54.8 Oct. 4 80,720 56,123 99,543 155,6G6 51.9 Oct. 10 78,500 55,925 103,135 159,060 49.4 Oct. 18 80,984 54,981 107,525 162,506 49.8 Oct. 25 86,472 60,132 111,045 171,177 50.5 Nov. 1 78,883 62,289 111,899 174,188 45.3 Nov. 8 82,322 60,077 111,998 172,075 47.8 Nov. 15 71,278 47,086 111,653 158,739 44.9 Nov. 22 77,784 43,501 112,160 155,661 50.0 Nov. 29 84,120 48,916 < 111,958 160,874 52.3 Dec. 6... 88,649 54,864 111,537 166,401 53.3 Dec. 13 92,863 58,592 111,231 169,823 54.7 Dec. 20 88,815 42,903 112,055 154,958 57.3 Dec. 27 92,740 47,626 112,510 160,136 57.9 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 10 KANSAS CITY. 671 FEDERAL RESERVE BAHK OF KAHSAS CITY. DEPOSIT AND NOTE LIABILITIES, ALSO CASH RESERVES. DURING THE CALENDAR YEAR 19IS, (MJ-yc/.J/et&cftosits. Curve2:JobxLCasfL>Jfteserpes. CUrvc3;jfggrwaX&Jfe2kft£&it& Curve 4:5ta£w of' GzsTt^eserpes doJfy&reg* Pi 85\ M \ e< h \ieo\ Mm \6o\ \ss\ [ss\\ M tod \\40\ to 60\ 40\ ZO\ \4-tt MZSt* &2 !4 /5-Z229SIZB2S3I01724317 HZ 2$S(2t92629 !623306B202?4it B2SI3 /S223SS1320Z?\ JAN\ FEB.I MCM.\ APR. 1 MAr\JUNE\JULY\AU6.\SEPT\ OCT. I /YOK [ DSC. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

672 ANNUAL KEPOKT OF THE FEDERAL RESERVE BOARD. SCHEDULE 1.—'•Income—Profit and loss account, at close of business Dec. SI, 1918, Dec, SI, 1917, Dec. SO, 1916, and Dec. SI, 1915. Dec. 31,1918. Dec. 31,1917. Dec. 30,1916. Dec. 31,1915. Earnings from: Bills discounted for member banks $2,643,113.16 $438,831.43 $84,571.71 $64,257.59 Bills bought, acceptance 157,982. 45 171,112.15 29,601.03 7,831.51 Trade acceptances 391.10 United States bonds 312,442.84 256, 792.18 186,411.19 20,630.85 Municipal warrants 5,136.63 14,366.41 9,575.48 Bill-of-lading drafts 877.'55" Profits on United States securities sold... 14,407.50 Transfers bought and sold 202,521.45 45,569,84 Sundry profits 11,576.59 1,111.99 i8i.9i' 673.76 Deficient reserve penalties (including in terest) 99,928.66 37,395.78 Service charges, net 23,493.43 Appreciation profit, United States bonds. 34,463.96 Exchange 962. 96 Total earnings.. 3,451, 936.13 955,950.00 364, 966.67 103,360.29 Expenses: Federal Reserve Board assessments. 17,998.37 13,118.24 10,574.64 5,928.48 Federal Advisory Council 270.00 370.00 305.85 357.10 Governors' conferences 430.09 665.23 1,244.74 924.13 Federal Reserve agents' conferences. 327.87 423.08 717.20 Salaries— Bank officers 68,045.47 37,781.97 25,972.81 28,820.82 Clerical staff 188,679. 56 39,684.21 32,231.06 34,915. 95 Special officers and watchman... 5,609.11 805.00 2,591.83 All others 784. 50 1,570.05 1,599.42 Directors' fees 8,260. 00 3,975.00 3,705.00 3,480.00 Per diem allowance 3,675. 00 3,660.00 2,385.00 4,316.00 Traveling expenses 6,553.24 4,192.65 3,628.04 4,662. 51 Officers' traveling expenses 2,425. 80 1,203.09 633.31 514. 72 Legal fees 1,225. 00 775.00 600.00 1,501.20 Rent 21,262.71 8,849. 96 7,949.96 9,538.85 Taxes and fire insurance 169.04 Telephone 2,481.04 810. 40 495.29 607.18 Telegraph 4,454. 90 565.11 351.55 572.17 60,973.84 4,971.74 6,457.19 10,347.01 Postage and insurance on gold concentra tion 35,800.81 9,283.80 Postage and insurance on silver concen tration 1,076.30 Currency shipments 1,412.27 Expressage. 466.38 1,233.64 824.85 103.24 Fidelity bond premiums 6,004.52 1,626.28 1,226.52 1,354.28 Light, heat, and power 2.522.58 1,184.56 979.50 1,241.00 Printing and stationery 25,369.88 5,658.42 3,136.34 9,171.34 Repairs and alterations 5,020.04 286. 74 213.36 86.63 All other expenses not specified herein... 15,660.13 7,216.69 4,108.18 4,227.68 Operating expenses. 486, 958. 45 148,682. 78 125, 979.32 Extraordinary expenses: Commissions paid 861. 03 Cost of Federal Reserve notes issued 48,679.35 20,436.16 Cost of Federal Reserve notes issued and unissued 98,542.01 Cost of Federal Reserve Bank notes (in Am cl o u r d t i i n z g a t t i a o x n es o ) rganization Federal Re 57,017.18 20,885.26 5; 790.54 serve notes 5,523.16 Amortization organization expenses 887. 35 26,484.44 Depreciation, furniture and equipment 46,710.47 19,130.59 3,900.00 Total extraordinary expenses.. 202,269.66 89,582. 55 62,134.30 861.03 Total all chargeable expenses.. 689,228.11 238,265.33 171,984.99 126,840.35 Net earnings 2, 762, 708.02 717,684.67 192,981.68 23,480. 06 Profit and loss account, 1916-17.. 295,759.08 91,381.23 Total earnings for distribution.. 3,058,467.10 809,065.90 192,981.68 Less dividends paid 309, 729.25 364,502.73 66,706.96 Less organization expenses 34,768.71 Less transit department disbursements, net deficiency 8,196.09 Less premiums on Umted States bonds 75,462.42 Less cost of unissued Federal Reserve notes... 42,507. 74 Less depreciation of furniture and fixtures 19,222.63 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTBICT NO. 10—KANSAS CITY. 673 SCHEDULE 1.—Income—Profit and loss account, at close of business Dec. 31, 1918, Dec. 31, 1917, Dec. 80, 1916, and Dec. 31, 1915—Continued. Dec. 31,1918. Dec. 31,1917. Dec. 30,1916. Dec. 31,1915. $6,577.14 $5, 766. 89 Less depreciation on bank premises 100,000.00 i Less amount transferred to account reserved for depreciation on United States bonds 220,734.00 Total deductions 637,040.39 515,658.50 Net earnings to profit and loss account.. 2,421,426. 71 293, 407.40 $101,475.67 Carried to surplus fund 1,210,713.35 Transferred to account surplus reserve fund franchise tax 1,210,713.36 SCHEDULE 2.—Earnings and expenses for calendar years 1917 and 1918, also profit and loss on Dec. 31, 1917, and Dec. 31, 1918. Dec. 31, 1918. Dec. 31, 1917. Earnings as shown on Form 95 $3,451,936.13 $955,950.00 Expense of operation of bank proper $486,958.45 $148,6S2. 78 Cost of Federal Reserve currency issued (including expressage, insurance, etc.) i 98,542.01 48,679.35 Miscellaneous charges account note issues 57,017.18 20,885.26 Depreciation on furniture and equipment 46,710.47 19,130.59 Transit department disbursements in excess of net service charges received 8,196.09 Total. 689,228.11 Net earnings for year 2,762,708.02 710,375.93 Profit and loss, Jan. 1, 1918 293,407.40 2 91,381.23 Profit added to profit and loss account (correction entries during the year 1918) 2,351.68 Total 3,058, 467.10 801, 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. 1, 1916, to June 30, 1916 89,116.92 Dec. 31,1917, for period July 1,1916, to June 30, 1917 183,197.54 June 30,1918, for period July 1,1917, to June 30, 1918 201,795.20 Dec. 31, 1918, for period June 30, 1918, to Dec. 31, 1918 107,934.05 Depreciation bank premises 100,000.00 Depreciation on United States bonds 220,734.00 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 6,577.14 5,766.89 Organization expense 887.35 Total deductions. 637,040.39 508,349.76 Profit and loss Jan. 1, 1918, and Jan. 1, 1919.... 2,421,426.71 293,407.40 Carried to surplus fund 1,210,713.35 Carried reserve for franchise tax 1,210,713.36 Total. 2,421,426.71 1 Including cost of Federal Reserve currency. 2 Jan. 1,1917. 100823°—19 43 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

674 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. SCHEDULE 3.—Comparative detailed statement at close of business Dec. 31, 1918, Dec. 31, 1917, Dec. 30, 1916, and Dec. 31, 1915. Dec. 31,1918. Dec. 31,1917. Dec. 30,1916. Dec. 31, 1915. RESOURCES. Bills discounted, members $28,751,159.24 $12,773,682.45 $479,067.72 $428,872.29 Bills discounted, members secured by- 623,170.66 8,203,888.30 17,277,467.89 35,820.74 Member banks' collateral notes secured 19,875,419.19 Bills bought in open market 14,203,695.36 1,337,928.75 3,945,180.94 3,580,463.35 Rediscounts for other Federal Reserve 5,003,293.86 Municipal warrants 163,813. 65 288,015.84 United States bonds to secure circula tion 8,000,000.00 8,000,000.00 6,000,000.00 United States Treasury certificates of indebtedness to secure circulation 821,000.00 United States one-year Treasury notes 3,499,000.00 Other United States bonds 867,450.00 849,090.00 2,492,850.00 2 151 650 00 Other United States certificates of in- 58,000.00 Premium and discount on United 85,887. 20 Interest accrued on United States bonds 62,257.78 60,504.90 53,978.18 8,862.18 1,784,000.00 963,000.00 400,000.00 Disbursements, Capital Issues Corn- 1,845.77 Liberty bonds sold to employees on 16,749.50 52,984.44 Expenses paid in advance 2,062.70 9,879. 48 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 6,875.00 13,750.00 25,978.29 15,000.00 Cost of unissued Federal Reserve Bank 983. 82 449,452.85 86,449.96 13,071.00 Due from other Federal Reserve Banks. 22,262,948.23 2,731,547.83 11,952,040.60 1,849,365.44 11,653,783.48 Due from member banks, overdrafts 119,854.93 17,688.57 11,783 74 Deferred debits, member and nonmem- 27,302,389.47 17,786,692.79 5,632,457.86 Exchangcs for clearing house 986,343.93 72,871.41 10,899. 57 5,000.00 Checks and other cash items 837,859. 80 160,809.46 6,415.95 363 85 6,883,190.00 Due from United States Treasurer, 5 per cent fund (account Federal Re- 565,600.00 400,000.00 300,000.00 National bank notes and Federal Re serve notes of other banks 1,839,565.00 216,300.00 107,645.00 348,318.00 Federal Reserve Bank notes on hand.. 723,519.00 6,000,000.00 Federal Reserve notes on hand 7,872,040.00 2,650,710.00 517,120. 00 564,850.00 Nickels and cents 514.43 350. 63 26.75 2.07 Gold settlement fund, credit balances.. 23,236,521. 55 37,263,377.50 21,235,500.00 2,464,000.00 Gold with Federal Reserve atrent 54,483,690.00 42,025,170.00 Duo from United States Treasurer, gold redemption fund (Federal Reserve notes) 3,590,042.20 507,045.00 150,095.00 107,000.00 Gold bullion and coin 3,472.50 118,742.50 371,195.00 3,933,700.00 G old held with foreign agencies 291,443.73 2,625,000.00 Gold certificates 151,710.00 1,591,780.00 5,793,590.00 4,535,310.00 Silver certificates 59,594.00 45,810.00 30,131.00 43 6QA Of) Legal-tender notes 38,187.00 11,000.00 113,845.00 70,375. 00 Silver coin 3,680.00 843.00 1,287.00 Total resources 241,862,722.90 162,290,478.93 66,532,157.93 20,518,071.05 LIABILITIES. Capital paid in 3,659,450.00 3,396,750.00 3,073,950.00 3,037,800.00 Surplus 1,210,713.35 Reserve for franchise tax 1,210,713.36 Reserve for depreciation on United States bonds 220,734.00 Unearned interest and discount 366,225. 90 119,799.05 17,748.50 54,665. 89 Government deposits 5,450,293.54 7,860,957.17 275,778.80 Due to other Federal Reserve Banks... 10,336,961.54 492,750. 72 84,75i,722.25 72,976,491.13 44,191,246.07 14,930,086.68 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 10—KANSAS CITY. 675 SCHEDULE 3.—Comparative detailed statement at close of business Dec. 31, 1918, Dec. 31, 1917, Dec. 30, 1916, and Dec. 31, 1915—Continued. Dec. 31, 1918. Dec. 31, 1917. Dec. 30,1916. Dec. 31,1915. Li ABILITIES—cont inued. Due to clearing members, deposit ac count $164.47 $25,319. 87 Cashier's and expense checks outstand ing 338,194. 86 971,533.33 $2,137.68 $2,767.76 Federal Reserve transfer and exchange drafts 354,189.07 Deferred credits, transit account 11,786,394.31 10,622,800.98 Federal Reserve B ank notes 12,172,000.00 8,000,000.00 6,000,000.00 Net liability Federal Reserve notes . 2,540,000.00 2,000,000.00 Federal Reserve notes issued 120,317,330.00 58,023,420.00 Reserved for taxes 24,597.79 2,829.32 Profit and loss undistributed earnings.. 293,407.40 91,506.02 Total 241,862,722.90 162,290,478. 93 68,532,157.93 20,518,071.05 SCHEDULE 4.—Discount operations for the year 1918. REDISCOUNTS FOR MEMBER BANKS, DISTRIBUTED BY STATES. State. b N o D e f e u r c m m b . a e b 3 n m e 1 k r . s o N a d f c u c a b m o t a e m b n d e o k . r s o N a f c u t t m i r o a b n n e s s r . Total. ha B n a d la D nc e e c . o n 3 1. Colorado 127 76 1,060 $68,956,666.94 $5,297,179.49 Kansas 243 100 1,392 41,575,488.54 4,245,655. 74 Missouri 57 30 977 361,055,504.28 20,095,435. 72 Nebraska 200 105 1,649 213,410,673.42 11,388,963.54 New Mexico 12 8 116 2,461,667.13 486,318, 20 Oklahoma 316 213 3,832 138,788,664.02 15,713,153.93 Wyoming 39 22 214 7,271,898. 04 226,930.77 Total 994 554 9,240 833,520,562.37 - 57,453,637.39 VOLUME BY MONTHS. NATURE OF PAPER DISCOUNTED—Con. January $40,191,283.73 February 21,489,413.98 Member banks' collateral loans: March 31,992,971.02 Secured by United States war April 54, 759,187. 41 obligations 470,765,469.60 May 95,717,514.03 Otherwise secured 148,369,224. 87 June 63, 441, 732. 66 July 83,131, 838.34 Total 833,520,562.37 August 58,748, 042. 78 September 78,626,372.90 MISCELLANEOUS. October 117,418,461.81 November 100,636,154.50 49,964 notes rediscounted, average December 81,354,589.23 amount $4,320.00 6,252 collateral loans made, average Total 833,520,582.37 amount 99, 060.00 Maximum amount held 99,203, 886. 61 NATURE OF PAPER DISCOUNTED. Minimum amount held 15,597, 156. 76 Offerings rejected: Trade acceptances $10,400,938.42 In part—1,584 offerings, 5,352 Bankers' acceptances 10,157.41 notes 15,958, 671.14 Agricultural paper 13,373,506.96 In whole—78 offerings, 217 notes 813, 447.80 Live-stock paper 98,191,258.93 Commercial and industrial paper... 89, 588,765.41 Total 16,770,118. 94 Commercial and industrial paper secured by United States war obli gations 4,893,636.74 REDISCOUNT RELATIONS WITH OTHER FEDERAL RESERVE BANKS DURING 1918. June 14,1918, rediscounted with Federal Reserve Bank of Chioago $4,362,312.62 June 14,1918, rediscounted with Federal Reserve Bank of Cleveland 4,168,066.08 Total., 8,530,378. 70 Oct. 1, 1918, rediscounted for Federal Reserve Bank of Dallas 5,000,000.00 Oct. 8,1918, rediscounted for Federal Reserve Bank of Atlanta 1,000,000.00 Total 6,000,000.00 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

676 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. SCHEDULE 4.—Discount operations for the year 1918—Continued. CHANGES IN DISCOUNT RATES DURING CALENDAR YEAR 1918. Rate in effect- Jan. 1, Apr. 8, May 20, Sept. 23, Jan. 1, 1918. 1918. 1918. 1918. 1919. Discounts maturing within 15 days, including mem Per cent. Per cent. Per cent. Per cent. Per cent. ber banks' collateral notes 4 4} Paper, including member banks' collateral notes, se cured by United States certificates of indebtedness or Liberty loan bonds maturing within 15 days 4J Paper maturing within 16 to 60 days 5 Paper maturing within 61 to 90 days 5 Paper secured by United States certificates of indebt edness or Liberty loan bonds maturing from 16 to 90 days H 4i Agricultural and live stock paper maturing after 90 days Trade acceptances maturing in 15 days or less , Trade acceptances maturing in 16 to 90 days 4i 4| In addition to above, effective Oct. 1, 1918, special rate of 4 per cent on 16 to 90 day paper secured by Liberty loan bonds, provided rate charged by member bank was not in excess of 4| per cent. SCHEDULE 5.—Open-market transactions for the year 1918. BILLS BOUGHT IN OPEN MARKET AND FROM OTHER FEDERAL RESERVE BANKS. 1,256items purchased in above period.total $33,221,285.75 At the following discount rates: 4 per cent $11,489,037.59 41 per cent.. $25,000.00 4£ per cent 6,790,233.77 4§ per cent.. 9,041. 33 4& per cent 1,798,022.27 5 per cent.. 556,667.46 4J per cent 10,018,547.73 51 percent.. 2,536.-40 4-A- per cent 88,549.85 4| per cent 33,629.35 Total i 33,221,285. 75 4 J per cent 2,410,000.00 By maturities at date of purchase: Up to 30 days $8,229,188.03 30 to 60 days 14,554,331.09 60 to 90 days 10,437,766.63 133,221,285.75 Classification: Domestic 11,219,906.35 Export or import 22,001,379.40 133,221,285.75 SCHEDULE 6.—Open-market transactions for the year 1918. WARRANTS. Purchases, none. SCHEDULE 7.—Open-market transactions for the year 1918—United States securities. PURCHASES. 3J per cent United States Liberty loan bonds (first issue) 1947 2 $17,650.00 4 per cent United States Liberty loan bonds (second issue) 1942 8,100.00 2 per cent United States special certificates of indebtedness 3,499,000.00 4 per cent United States certificates of indebtedness (sundry issues] 4,891,000.00 4| per cent United States certificates of indebtedness (sundry issues) 2,713,000.00 Total 11,128,750.00 SALES. 2 per cent Panamas, 1936 $2,240.00 2 per cent Consols of 1930 850.00 3^ per cent United States Liberty loan bonds (first issue) 1947 5,200.00 4 per cent United States certificates of indebtedness (sundry issues) 2,803,500.00 4§ per cent United States certificates of indebtedness (sundry issues) 1,861,500.00 4 per cent United States Liberty loan bonds (second issue) 1942 100.00 Total 4,673,390.00 i Exclusive of $515,737 purchased by the Federal Reserve Bank of New York for our account on Dec. Digitized fo3r1 ,F 1R91A8.S ER http://fraser.s 2 tEloxucliussfievde .oofr gp/u rchases of 3£ per cent interim certificates ocr«™—*-•- ~ Federal Reserve Bank of St. Louis

DISTKICT sro. 10—KANSAS CITY. 677 CONVERSIONS. One-year Treasury notes $821,000.00 4 per cent United States Liberty loan bonds (second issue) converted to 4| per cent 8,000.00 Total 829,000.00 UNITED STATES SECURITIES ON HAND DEC. 31, 1918. 3 per cent United States conversion bonds 1916-1946 $16,600.00 3 per cent United States conversion bonds 1917-1947 821,900.00 4 per cent United States bonds, 1925 825,000.00 2 per cent Panamas, 1936 20,000.00 3| per cent United States Liberty loan bonds (first issue) 1947 19,950.00 4i per cent converted United States Liberty loan bonds (second issue) 1942 8,000.00 2 per cent United States one year certificates of indebtedness 3,499,000.00 4| per cent United States certificates of indebtedness (sundry issue) 58,000.00 2 per cent consols, 1930 7,155.000.00 One-year Treasury notes, Jan. 1,1919 821,000. 00 Liberty bonds to secure participation certificates 1,000.00 Total 13,245,450.00 SCHEDULE 8.—Discount and investment operations for the year 1918—average amount of each class of earning assets held, total earnings, and average annual rates thereon. h A o v ld e i r n ag g e s . Earnings. Av ra e t r e a . g e Per cent. Bills discounted, members $55,732,674 $2,643,113 4.74 Bills bought in open market 3,707,610 157,982 4.26 United States securities 12,069,015 312,443 2.59 Total 71,509,299 3,113,538 4.35 SCHEDULE 9.—Reserve position. [Monthly averages.] Percent Percent Pe c r a c r e ri n e t d a . g e ce P n e t r a ge! ag re e o q e v u x e i c r r e e ss Pe c r a c r e ri n e t d a . g e ce P n e t r a ge] a r g e e o q v e u x e ir r c e e ss Month. re ments. Month. re ments. quired. quired. 1918 1917 1918 1917 January.. 58.1 74.8 23.1 39.8 August 54.0 19.0 38.6 February 60.5 74.2 25.5 39.2 September 58.0 23.0 34.8 March— 64.9 71.9 29.9 36.9 October 52.7 69.9 17.7 34.9 April 48.3 67.4 13.3 32.4 November 49.3 78.8 14.3 43.8 May 52.9 62.6 17.9 27.6 December 63.9 64.0 28.9 29.0 June 51.7 58.7 16.7 23.7 July 51.1 71.5 16.1 36.5 Yearly averages. 20.4 35.6 SCHEDULE 10.- - Membership—Additions and withdrawals and effect on the total capital stock. ADDITIONS. Capital Number subscription Capital State. of Federal and surplus banks. Reserve Bank of member of banks. Kansas City. Colorado 7 $77,200 $1,285,500 Kansas„ „., __,_,. r, „ 9 36,300 602,500 Missouri 2 27,200 451,800 Nebraska 9 31,000 516,000 New Mexico. . 3 6,900 115,000 Oklahoma 9 45,900 763,500 Wvominsr 2 2,900 47,500 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

678 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. SCHEDULE 10—Membership—Additions and withdrawals and effect on the total capi tal stock—Continued. WITHDRAWALS. State. N b u a m n of k b s e . r sur C re a n p d it e a r l e d. a o n f C d m a s p e u i m r ta p b l l e u r s banks. Colorado 1 $4,400 $73,000 Kansas 1 12,000 200,000 Oklahoma 6 24,000 398,500 Total 8 40,400 671,500 SCHEDULE 11.—Member-bank deposits. [Net daily averages for the year 1918.] Month. Amount. Month. Amount. January.. $75,325,076. &3 July $77,907,664.90 February 77,089,289.18 August... 81,790,194.82 March 77,276,628.70 September 83,455,991.96 April 77,983,701.33 October... 86,124,318.40 May 76,557,467.58 November. 86,866,847.61 June 77,606,546.55 December. 86,954,231.89 DEFICIENT RESERVES. [Daily averages for the year 1918.] Period. ! o N f u b m a b n e k r s . de a f D v ic e a i r e i a l n y g c e y . A p m en o a u lt n i t e s o . f January 92 $1,476,977 $7,804.43 February.. 134 1,149,391 6,408.87 March 118 608,080 3,083.46 April 119 755,859 4,339.91 May 102 724,648 5,260,03 June 85 1,000,568 7,068. 87 July 93 527,626 4,643.97 August 151 1,293,206 10,472.32 September. 160 674,395 4,987,09 October 192 1,772,244 11,501.31 November.. 171 2,770,121 20,577.28 December.. 180 1,809,327 13,781.12 Total 1,597 1,130,203 99,928.66 SCHEDULE 12.—Government account from Jan. 1, 1918, to Dec. 31, 1918. [Including balance to credit of United States Treasurer, Dec. 31,1917.] Balance to credit of United States Treasurer, December 31, 1917 $18,756,046.49 Total amount of transfers from other Federal Reserve Banks None. Receipts from sale of Liberty bonds 460,371,818.00 Receipts from sale of Treasury certificates 378,254,500.00 Total amount of other net credits to United States Treasurer 175,844,929.05 Total 1,033,227,293.54 Total amount of warrants paid 127,083,000.00 Total amount of certificates of indebtedness paid 302,424,000.00 Total amount transferred by order of United" States Treasurer 598,270,000.00 Balances to credit of United States Treasurer December 31, 1918 5,450,293. 54 Total 1,033,227,293.54 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 10—KANSAS CITY. 679 SCHEDULE 12.—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. SI, 1918. RESOURCES. Federal Reserve notes on hand $7,520,000. 00 Federal Reserve notes outstanding 120,317,330.00 Rediscounts to secure Federal Reserve notes 71,657,332.75 Credit balance in gold redemption fund $3,123,690.00 Credit balance with Federal Reserve Board 51,360,000.00 54,483,690.00 Federal Reserve notes sent to Comptroller of Currency for cancellation and destruction 27,862,670.00 Total 281,841,022.75 LIABILITIES. Federal Reserve notes from Comptroller of Currency—gross amount 155,700,000.00 Collateral received from Federal Reserve Bank: Eligible paper 71,657,332.75 G old 54,483,690.00 Total 281,841,022.75 SCHEDULE 14.—Federal Reserve notes, statement of Federal Reserve Agent, from organi zation to Dec. SI, 1918. Number of pieces. Aggregate Fives. Tens. Twenties. Fifties. d H re u d n s . amount. Received from Comptroller 8,956,000 4,504,000 2,704,000 108,000 64,000 $155,700,000 Received from Federal Reserve Bank... 532,800 244,700 251,700 100,000 15,145,000 Received from Treasurer of United States (fit notes) 300 Received by Comptroller from Treasurer of United States lor destruction and credit of Federal Reserve Agent's 3,000 account (unfit notes): (a) From other Federal Reserve Banks 915,842 332,659 112,503 656 107 (b) Direct from reporting Federal Reserve Banks and from other sources 2,111,692 474,305 108,920 2,812 428 1170, 616939, 331600 Total 12,516,334 5,555,964 3,177,123 211,468 64,535 198,710,670 Issued to Federal Reserve Bank 9,264,800 4,561,000 2,855,700 177,200 54,200 163,328,000 Returned to Comptroller of the Currency for destruction, including notes re turned by United States Treasurer for credit of Federal Reserve Agent's account 3,027,534 806,964 221,423 3,468 535 27,862,670 224,000 188,000 100,000 30,800 9,800 7,520,000 Total 12,516,334 5,555,964 3,177,123 211,468 64,535 198,710,670 SCHEDULE 15.—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 sine© Jan. 1, 1917.] Fives. Tens. Twenties. Exchanged with Federal Reserve Bank of— Received Returned Received Returned Received Returned from. to. from. to. from. to. Boston $117,310 $13,215 $166,240 $42,700 $269,000 $6,400 New York.. 947,500 151,900 1,294,000 339,300 1,761,850 249,700 Philadelphia 128,000 15,250 217,000 47,550 427,500 35,700 Cleveland... 77,090 29,050 143,050 98,100 212,400 97,100 Richmond.. 69,250 22,950 334,490 36,690 381,000 41,900 Atlanta 276,565 82,600 370,640 111,450 546,400 90,100 Chicago 3,987,495 224,750 3,771,000 540,400 2,966,000 370,800 St. Louis 2,976,210 390,750 2,448,260 547,100 2,472,100 234,200 Minneapolis. 405,160 198,050 360,410 231,150 428,380 136,500 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

680- ANNUAL, REPORT OF THE FEDERAL RESERVE BOARD. SCHEDULE 15.—Federal notes received and returned—Continued. Fifties. Hundreds. Total. Exchanged with Federal Reserve Bank of— Received Returned Received Returned Received Returned from. to. from. to. from. to. Boston $14,550 $2,800 $10,100 $4,800 $577,200 $69,915 New York 159,700 23,550 145,200 52,000 4,308,250 816,450 Philadelphia 27,100 4,000 21,900 3,400 821,500 105,900 Cleveland 20,600 13,950 10,300 7,600 463,440 245,800 Richmond 11,900 10,700 6,600 48,200 803,240 160,440 Atlanta 21,250 5,450 13,500 2,200 1,228,355 291,800 Chicago 175,400 77,900 161,100 145,000 11,060,995 1,358,850 St. Louis 137,700 9,450 73,700 3,700 8,107,970 1,185,200 Minneapolis 23,650 4,900 17,400 8,100 1,235,000 578,700 Dallas 107,900 5,750 56,250 3,400 3,166,470 1,077,400 San Francisco 74,750 15,250 41,800 26,400 1,831,940 430,150 Total 774,500 173,700 557,850 304,800 33,604,360 6,320,605 SCHEDULE 16.—Federal Reserve notes—Federal Reserve Agent. Issued to hank, 1918 $62,433,910.00 Received by Comptroller for cancellation and destruction 18,127,430.00 Federal Reserve notes on hand, new, unissued 7,520,000.00 Cost of issued and unissued notes for the year 98,542.01 The cost of issued notes was made on the following basis: DENOMINATIONS. Cost per $1,000. Fives $2.59 Tens 1.33 Twenties .79 Fifties .35 Hundreds. .28 Federal Reserve notes of the Federal Reserve Bank of Kansas City received from other districts amounted to $25,821,185. Shipment cost averaged approximately 29 cents per 1,000, and is not included in the above schedule. SCHEDULE 17.—Official and clerical staff. Number of officers Number of employees in various departments. MONTHLY PAY ROLL, EMPLOYEES. 1918 1917 Department. Monthly Monthly Number. salaries. Number. salaries. Federal Reserve agent's office and credit bureau $510 $365.00 General clerical force, including discount, auditing, and all other departments except transit 121 9,300 2,709.99 Transit department 139 10,000 2,053.33 Fiscal agent department (recoverable through United States Treasurer) 201 17,800 Total 37,610 59 5,128.32 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 10—KANSAS CITY. 681 SCHEDULE 18.—Recapitulation, city and country clearings, December, 1914, to Dec. SI, 1918. 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 4 9 1 8 . .. 861,583 4,745,318 5,606,901 Total 2,090,486 12,360,252 14,450,738 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 1918 2, 615,094,874.86 1,841,680,624.15 4,456,774,499.01 Total 4,784,995,829.17 3,997,412,231. 46 i, 782,407,060.63 MEMBER BANKS, KANSAS CITY (PROPER). City. Country. Total. Month. Items. Amount. Items. Amount. Items. Amount. 1918. January 55,793 $212,670,281.24 232,731 $137,643, 853.71 288,524 $350,314,134.95 February 49,604 178,638,432.82 209,122 112,891,607.89 258,728 291,330,040.71 March 58,820 237,469,764.26 247,042 150,205,498.91 305.862 387,675,263.17 April 57,740 185,156,141.30 223,297 112,727,943.09 281; 037 297,884,084.39 May 54,279 183,369.926.42 206,775 119,578,103.99 261,054 302,948,030. 41 June 118,760 211,616,435.54 426,116 144,045,009.77 544,876 355,661,445.31 July 66,486 219,261,301.78 476,925 160,630,393.68 543,411 379,891,695.45 August 63,340 212,851,580.96 477,501 148,062,248.21 540,841 360,903,829.17 September 64,679 197,828,808.20 475,551 151,624,854.00 540,230 349,453,662.20 October 90,177 280,615,011.34 542,813 219,166,223.71 632,990 499,781,235.05 November 87,728 241,243,068.94 594,069 195,726,245.84 681,797 436,969,314.78 December 94,177 254,374,122.06 633,376 189,588,641.32 727,553 443,962,763.38 Total 861,583 2,615,094,874. 86 4,745,318 1,841,890,624.12 5,606,903 j 4,456,775.498.97 ITEMS ON OTHER DISTRICTS. 1918 January 3,153 $91,400, 986.18 13,140 $7,846,824.81 16,293 $99,247. 810.99 February.. 3,412 54,348, 608.22 11,552 6,560,355.62 14,964 60,908: 963. 84 March 3,790 54,295,5 62.00 12,229 8,594,660.79 16,019 62,890; 222.79 April 3,513 65,169,9 52.53 10,807 5,223,400.73 14,320 70,393,3 53.26 May 3,729 58,916. 577.66 11,226 7,126,497.58 14,955 66,043,0 75.24 June 5,050 62,461, 601.21 43,098 47,308,227.86 48,148 109,769,8 29.07 July 9,316 96,975, 876.06 71,078 12,292,222.86 60,393 109,268,0 98.92 August 10,839 104,749,0 70.10 80,090 11,436,308.74 90,929 116,185,3 78. 84 September. 8,471 87,982,2 47.00 78,625 12,504,317.79 87,096 100,486,5 64.79 October 9,461 104,808,6 52.76 80,914 15,528,491.78 90,375 120,337,1 44.54 November. 8,342 103,658,1 37.40 75,193 11,279,833.35 83,535 114,937,9 70.75 December.. 8,127 77,864, 163.58 73,257 10,629,343.11 81,384 88,493,5 06.69 Total. 77,203 962,631,434.70 561,209 156,330,485.02 618,411 1,118,961,919.72 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

682 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. SCHEDULE 18.—Recapitulation, city and country clearings, December, 1914, to Dec, 31, jf9i£—Continued. STATE BANKS. Month. Items. Month. Items. Amount. 1918 1918 January 46,241 $4,942,124.29 August 233,074 $15,227,792.15 February 42,598 3,979,045.77 September 298,652 20,363,654.36 March 48,184 5,653,723.98 October 366.034 24,811,147.60 April 45,661 4,253,031.60 November 382,113 23,415.295.38 May 40,925 4,889,697.68 December 389,960 21,985,032.87 June 120,528 9,424,942.60 July 197,862 11,883,458.96 TotaL.. 2,211,832 150,818,947.24 DAILY AVERAGE. City. Transit. Month. Items. Items. Amount. 1918 January 2,146 $8,179,6 26.20 11,356 301,299.65 February 2,156 7,766,6 88.38 11,594 720,852.93 March 2,262 9,133,4 52.47 11,971 413.440.21 April 2,309 7,406,2 45.65 11,331 494,973.11 May 2,049 7,052,6 89. 47 7,952 599,157. 84 June 4,750 8,464,8 57.42 23,791 529,591.25 July 2,557 8,433,1 26.80 31,802 837,767.33 August 2,436 8,186,5 99.27 30,827 748,669.97 September 2,695 8,242,8 70.00 35,934 265,930. 00 October 3,229 10,393,1 48.56 37,009 493.130.22 November 3,814 10,488,8 29.08 46,074 525,196.17 December 3,767 10,174,9 64.88 44,189 602,687.23 Yearly average 2,847 8,660,241.52 25,320 9,953,557.99 MEMBER BANKS, OMAHA BRANCH. City. Country. Total. Month. Items. Amount. Items. Amount. Items. Amount. 1918 January 39,256 $32,451,425. 00 57,688 $30,331,147.00 96,944 $62,782,572.00 February 35,488 29,113,572.00 47,131 31,193,218.00 82,619 60,306,790.00 March 41,530 53,848,499.00 60,486 45,851,600.00 102,016 99,700,099.00 April 40,806 51,332,909.00 57,600 27,161,821.00 98,406 78,494,730.00 May 37, 455 57,546,959.00 65,007 22,073,900.00 102,462 79,620,859.00 June 37,959 46,307,599.00 70,476 20,925,097.00 108,435 67,232,696.00 July 40,506 45,979,802.00 83,855 23,352,786.00 124,361 69,332,588.00 August 40,593 53,627,402.00 171,798 44,533,117.00 212,391 98,160,519.00 September 43,787 54,460,298.95 114,305 31,144, 530.09 158,092 85,604,829.04 October 54,606 89,522,503.00 132,912 34,788,331.31 187,518 124,310,834.31 November 48,502 59,882,361.00 95,201 20,350,215.00 143,703 80,232,576.00 December 49,365 41,210,896.85 108,970 16,244,929.73 158,335 57,455,826.58 Total 509,853 615,284,226.80 1,065,429 347,950,692.13 1,575,282 963,234,918.93 ITEMS ON OTHER DISTRICTS, OMAHA BRANCH. Month. Items. Amount. Month. Amount. 1918. 1918. January 7,017 $10,304,232.00 August 35,-692 $18,695,807.00 February 9,125 8,383,817. 00 September... 36,207 22,026,970.00 March 11,098 13,331,711.00 October 32,196 27,563,728.00 April 10,262 12,331,633.00 November... 46,363 27,740,701.00 May 2,415 12,919,777.00 December... 62, 325 30,425,301. 28 June 8,926 11,289,257.00 July 29,587 16,050,418.00 Total.. 291,213 211,063,352.28 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 10—KANSAS CITY. 683 SCHEDULE 18.—Recapitulation, city and country clearings, December, 1914, to Dec* SI, 1918— Continued. STATE BANKS. Month. [ Items. Amount. Month. Items. Amount. 1918, 1918. January 15,916 $1,012,749.00 August 32,260 220,211.00 February 13,882 917,384.00 September.. 48,887 139,356.00 March 17,069 | 1,938,350.00 October 64,850 519,656.00 April 15, 920 1,489,876.00 November... 61, 998 027,792.00 May 15, 700 1,666,657.00 December... 79,889 003.500.59 June 16,545 1,815,200.00 July 20, 822 2,143,448. 00 Total.. 403, 738 33,894,179.59 DAILY AVERAGE, OMAHA BRANCH. City. Transit. Items. Items. Amount. 1918. January 1.510 $1,248, 131.75 3,100 $1, 601,851.23 February.. 1^613 1,323,3 44.28 3,180 1, 840,655.40 March 1,597 2,071,0 96.11 3,409 2, 350,833.11 April 1,632 2,053,3 16.36 3,351 639,333.20 May 1,440 2,213,3 44.57 2,500 i; 848,996.15 June 1,518 1,853,0 39.96 3,833 381,182.16 July 1,558 1,768,5 53.90 5,164 i. 597,948.15 August 1,503 1,986,2 00.17 6,363 i; 649,374.70 September. 1,824 2,269, 178.00 8,308 1, 387,952.00 October 2,022 3,241,5 74.18 8,516 2 513,767.23 November. 1,940 2,395,2 94.44 8,142 2 124,748.32 December.. 1,974 1,648,4 35.87 10,047 2 066,949.26 2, Yearly average., 1,661 2,005,959.13 5,493 1,833,632.57 MEMBER BANKS, DENVER BRANCH. City. Country. Total. Month. Items. Amount. Items. Amount. Items. Amount. 1918. 30,318 $21,774,341.76 47,648 $7,411,381.61 77,966 $29,185,723.37 May 21,618 18,692,095.35 49,935 7,667,425.34 71,553 26,359,520.69 16,877 16,463,207.29 53,973 7,936,393.33 70,850 • 24,399,600.62 July 22,541 23,397,929.16 67,101 8,724,329.13 89,642 32,122,258.29 August 24,312 23,424,852.74 111,258 31,919,800.08 135,570 55,344,652.82 27,809 31,741,440.92 81,036 9,936,284.29 108,845 41,677,725.21 October 36,926 40,124,728.26 95,870 12,063,946.56 132,796 52,188,674.82 November 35,983 44,932,555.01 100,004 15,930,492.21 135,987 60,863,047.22 37,892 37,109,756.45 108,137 12,642,989.32 146,029 49,752,745.77 Total 254,276 | 257,660,906.94 714,962 114,233,041.87 969,238 371,893,948.81 ITEMS ON OTHER DISTRICTS, DENVER BRANCH. Month. Items. Amount. Month. Items. Amount. 1918 1918—Continued, April 4,973 $17,969,726.07 October 19,553 $32,479,859.81 May .• 11,822 23,523,000.87 November 19,021 34, 789,905.11 June 4,212 17,825,908.97 December 24,692 29,987,622.34 July 13,915 22,291,380.98 August 14, 542 22,601,802.23 Total 129,578 231,116,057.31 September... 16,848 29,646,850.93 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

684 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. SCHEDULE 18.—Recapitulation, city and country clearings, December, 1914, to Dec. 31, 1918—Continued. STATE BANKS. Month. Items. Amount. Month. Items. Amount. 1918. IS) 18—Continued. April 4,946 $438,066.82 Octol Der 53,861 $3,458,838.07 May 5,147 461,508.15 Nove mber 53,565 3,237,058.88 June 7,096 443,930.57 Dece] tnber 58,015 3,013,248.86 11,163 677,797.31 24,406 1,190,367.91 Total 259,156 15,100,813.96 September 40,957 2,179,997.39 DAILY AVERAGE. City. Transit. Month. Items. Amount. Items. Amount. 1918. 1,166 $837,474.68 2,214 $993,008. 71 831 718,926.74 1,920 294 900 97 675 658,528. 29 2,611 1,048,249.31 July 867 899,920.35 3,544 1,218,981.05 900 867,587.14 4,121 1,182,214.82 September 1,158 1,322,558.00 5,784 1,740,130. 00 October 1,368 1,486,101.05 6,269 1,777,875.72 1,564 1,953,569.35 7,504 2,345,976.35 1,516 1,484,390.26 7,674 1,825,754.42 1,116 1,136,561.76 4,627 1,380,797.93 COMBINED DAILY AVERAC JE, KANSAS CITY, OMAHA, AND DENVER BRANCHES. 1918. 3,656 $9,427,757.93 14,456 $10,903,150.88 February 3,769 9,090,232.68 14,782 1 9,581,502.33 March 3,859 11,204,548.58 15,380 10,764,273. 32 April 5,107 10,297,036.69 16,896 10,127,313.02 May v 4,359 9,984,960.79 12,373 ! 5,743,054.97 June 6,944 10,975,489.67 30,241 12,939,022. 73 July 4,982 14,551,933.21 40,310 13,654,696.53 August 4,839 11,040,386.48 41,311 J 13, 580,259.19 September 5,677 11,834,606.00 50,026 15,438,012.00 October 6,619 15,120, 623. 79 51,794 ! 17,784, 773.17 November 7,318 14,837,712.87 61,720 18,995,920.84 December - 7,257 13,307,791.01 61,910 15,495,390.91 Yearly average 5 365 11,764,398.31 34,267 12,917,284.65 SCHEDULE 19.—Certificates of indebtedness anticipatory of third Liberty loan. Total subscriptions for district $128,524,500 824 national banks subscribed $80,274,500 2,065 State banks subscribed 33,781,500 52 trust companies subscribed 8,593,000 502 individuals subscribed 5,875,500 128,524,500 Fer cent. 824 national banks subscribed out of total of 936 88.03* 2,065 State banks subscribed out of total of 3,055 67.59 52 trust companies subscribed out of total of 84 61.90 SCHEDULE 20.—Certificates of indebtedness anticipatory of fourth Liberty loan. Total subscriptions for district $176,866,000 852 national banks subscribed $106,536,000 2,451 State banks subscribed 56,755,000 58 trust companies subscribed 11,085,000 54 individuals subscribed 2,490,000 176,866,000 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 10 KANSAS CITY. 685 SCHEDULE 21.—Certificates of indebtedness anticipatory of third Liberty loan. Date. Due. Rate. s N ub u s m c b ri e b r e o rs f . Paid by credit. subs T c o ri t p al t ion. Per cent. Jan. 22, 1918 Apr. 22, 1918 4 510 $5,999,044.96 $12,000,000 Feb.8, 1918 May 9,1918 4 1,517 10,550,461.56 21,411,000 Feb. 27, 1918 May 28, 1918 If 1,913 13,947,322.04 23,736,500 Mar.20,1918 June 18, 1918 1,750 12,779, 509.87 26,116,500 Apr. 10, 1918 July 9, 1918 1,440 13,795, 528.60 25,000,000 Apr. 22, 1918 July 18, 1918 41- 1,241 9,919, 972. 55 20,260,500 Total 66,991,839. 58 128,524,500 SCHEDULE 22.—Certificates of indebtedness anticipatory of fourth Liberty loan. Date. Due. Rate. s N ub u s m c b ri e b r e o rs f . Paid by credit. subs T c o ri t p al t ion. Per cent. June 25,1918 Oct. 24, 1918 U 1,339 $16,644, 543.62 $28,410,500 July 9, 1918 Nov. 7, 1918 u 1,989 18,387,862.73 30,031,500 July 23, 1918 Nov. 21, 1918 1,767 15,455,789.06 23,369,000 Aug, 6, 1918 Dec. 5, 1918 1,923 16,585,102.34 25,126,000 Sept. 3, 1918 Jan. 2,1919 1,731 17,676, 783.50 25,913,000 Sept. 17, 1918 Jan. 16, 1919 4V 1,428 15,920, 891.17 22,816,000 Oct. 1, 1918 Jan. 30, 1919 U 1,312 15,003,061.34 21,200,000 Total 115,674,033.76 176,866,000 SCHEDULE 23.—Certificates of indebtedness, tax series. Date. Due. Rate. s N ub u s m c b ri e b r e o rs f . Paid by credit. subs T c o ri t p al t ion. Per cent. Nov. 30,1917 June-25, 1918 4 41 $405,000.00 $1,072,000 Jan. 2, 1918 do 4 183 9,286,000.00 17,075,000 Feb. 15, 1918 do 4 32 209, 001.32 498,500 Mar. 15, 1918 do 4 56 261,081.55 824,500 Apr. 15,1918 do 4 39 239,000.00 1,028,000 May 15, 1918 do 4 12 420,000.00 538,500 Aug. 20, 1918 July 15, 1919 4 189 2,113,206.77 3,662,500 Total 12,933,289.64 24, 699,000 SCHEDULE NO. 24.—Liberty loan bonds. Number of subscribers. Subscriptions and allotments. States. Third Fourth L l i o b a e n r . t y L l i o b a e n r . t y Third l oa L n i . b erty Fourt l h o a L n. i berty Total. Colorado 177,937 193,965 $31,295,750 $42,007,550 $73,303,300 Kansas 317,469 331,824 47,381,200 73,914,550 121,295,750 Missouri 141,352 177,528 29,868,100 46,433, 750 76,301,850 Nebraska 244,584 271,532 50,524,400 75,583,200 126,107,600 New Mexico 12,694 12,009 2,228,750 2,144, 200 4,372,950 Oklahoma 249, 208 261,123 36,057,600 45,685,050 81,742,650 Wyoming 47,089 63,645 6,737,000 10,183,150 16,920,150 Total 1,190,333 1,311,626 204,092,800 295,951,450 500,044,250 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

686 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. SCHEDULE NO. 25.—Classification of subscriptions, Liberty loan bonds. Third Fourth Third Fourth Size of subscriptions. Liberty- Liberty- Class. Liberty Liberty loan. loan. loan. loan. $50 to $10,000 $179,027,650 $254,611,600 $99,966,650 $140,741,950 $10,050 to $50,000 15,172,500 24,158,400 State banks 93,380,400 127,503,050 $50,050 to $100,000 4,467,050 6,454,550 8,684,150 15,828,900 $100,050 to $200,000.... 3,120,600 5,782,600 Individuals 2,061,600 11,877,550 $200,050 and over 2,305,000 4,944,300 Total 204,092,800 295,951,450 Total 204,092,800 295,951,450 SCHEDULE NO. 26.—Character of payments, third Liberty loan. Date. By cash. By credit war By certificate of Total Accrued loan account. indebtedness. principal. interest. 5 per cent payment and cash sales to May 9..'.......... $67,797,993.64 $34,533,231.36 $39,328,000.00 $141,659,225.00 $208.55 5,095,399.11 6,491,003.39 2,415,000.00 14,001,402.50 13,611.20 17,578,234.01 11,198,390.99 676,500.00 29,453,125.00 78,404.75 Installment, Aug. 15 9,929,121.73 9,049,813.27 18,978,935.00 345,648.82 Total..... 100,400,748.49 61,272,439 01 42,419,500.00 204,092,687.50 437,873.32 SCHEDULE NO. 27.—Character of payments, fourth Liberty loan. Date. By cash. B lo y a n c r a e c d c it o u w n a t r . B i y n d ce e r b t t i e fi d c n a e te s s o . f pri T n o c t i a p l a l. A in c t c e r r u e e s d t. , 10 per cent payment and cash sales to Oct. 19 $53,304,608.81 $68,393,901.19 $69,087,000.00 $190,785,510.00 $393.08 Installment, Nov. 21 15,081,275.41 19,417,829.59 3,841,500.00 38,340,605.00 62,099.57 Installment, Dec. 19 11,587,871.64 14,281,548.36 574,000.00 26,443,420.00 72,856.89 Total 79,973,755.86 102,093,279.14 73,502,500.00 255,569,535.00 135,349.54 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. The Federal Reserve Bank of Dallas has made great headway in the matter of earnings in 1918, as is shown by Schedule 1. Total earnings for the year amounted to $2,089,526 and were 66 per cent of the bank's capital, as compared with 1917, when the total earnings were $568,592, or 20 per cent of its capital. Liberal deductions from earnings have been made for depreciation on certain asset items, as shown in the attached analysis of the profit-and-loss account. The bank has paid dividends up to date, and it is expected that future dividend requirements will be promptly met. On June 30, 1918, a dividend of 6 per cent was paid member banks covering the operating period from July 1, 1917, to June 30, 1918. The amount distributed was $168,871.16. After paying this dividend, and allowing for liberal depreciations, $610,496.88 remained in the profitand-loss account. At its meeting on December 12 the board of directors declared a dividend at the rate of 6 per cent per annum for the operating period from July 1 to December 31, 1918, payable on the latter date. The dividend amounted to $92,328.75. After making the distribution, and providing for depreciation and all proper deductions, $1,184,408 remained in the profit-and-loss ac count, enabling the bank to set up a surplus fund of $592,204, and reserve an equal amount as a franchise tax payable to the Govern ment on call. The great expansion in the bank's operations has also necessitated an increase in the expense account. It has been necessary to make extensive additions to the equipment, pay out large amounts for furniture and fixtures, stationery, and supplies, and to make revisions in and additions to the pay roll. Expenses amounted to $535,424 in 1918 and were 26 per cent of the earnings. COMPARATIVE BALANCE SHEETS FOR DEC. 31, 1916, 1917, AND 1918. Comparative balance sheets or statements of condition of the bank as of the above dates are attached as Schedule 2. 687 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

688 ANNUAL, REPORT OF THE FEDERAL RESERVE BOARD. PROFIT-AND-LOSS STATEMENTS FOR 1916, 1917, AND 1918. An analysis of the profit-and-loss statements for the above dates is attached as Schedule 3. GENERAL BUSINESS AND BANKING CONDITIONS. VOLUME OF BUSINESS. In spite of disturbed conditions and the serious curtailment of many industries, on account of the war and the drought existing over a large area of the district, the volume of business transacted has been generally satisfactory. The high prices of all classes of mer chandise more than offset the decreased number of orders in certain lines, and the financial returns from the year's operations are ex pected to be as good as in 1917. The prices obtaining for goods had the effect of restricting purchases mainly to essentials, and non essential lines have suffered. The influenza epidemic seriously affected trade during the early fall months. Retail lines suffered, especially, and have not yet completely recovered. With the signing of the armistice, and the removal of various governmental restrictions, some improvement was noticeable, and a general restoration of activities is anticipated in the near future. The year 1918 opened with depressed business in the western and southwestern portions of the district on account of the very serious drought, and while conditions improved somewhat in the early spring as the result of good rains, this relief was only temporary, and through out the summer and early fall months trade in those sections was very unsatisfactory. During the fall and winter, however, the protracted drought was effectually broken. Crops in the eleventh district in 1918 were disappointing. The yield of feed was light, and much below that of a normal year. The production of small grain in the district was approximately 8,500,000 bushels of wheat, 25,000,000 bushels of oats, and 80,000,000 bushels of corn. These yields were much below the production of 1917, which was approximately 15,000,000 bushels of wheat, 35,000,000 bushels of oats, and 85,000,000 bushels of corn, and were not sufficient for local consumption. The wheat crop was especially disappointing in the counties of west and northwest Texas, the principal grain producing section of the district. In many counties the grain did not even germinate on account of dry weather. As an offset, however, to these poor agricultural returns, business in the larger cities has been good. Plenty of work was available and wages have been the highest on record. At cantonment cities and towns adjacent to military posts especially, local business has been the heaviest ever experienced. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 11—DALLAS. 689 Manufacturing has been as active as fuel restrictions, labor condi tions, and the supply of raw materials would permit. War contracts took precedence over ordinary operations. The cattle and sheep industries, of great importance in this district, have been heavily damaged and demoralized on account of drought conditions. Poor ranges and high prices of feed have forced many stockmen to sacrifice their herds. Market receipts, reflecting this condition, have been very heavy, and consisted principally of stock cattle in an unfinished shape, sacrificed by stockmen on account of the high cost of feed. Post-office receipts and bank clearings have increased at the principal cities of the district throughout the year. Postal receipts for the first 11 months of 1918 at the principal cities show an increase of 11.3 per cent over the same period the previous year. Clearings at the same cities, covering a similar period, show an increase of 16.7 per cent. The number of business failures in the district during 1918 shows a reduction of 37.9 per cent, as compared with 1917, and is indicative of generally healthy conditions. Every month has shown a reduc tion, both in the number of suspensions and the amount of liabilities involved, the latter decreasing 12.8 per cent during the year. The building industry has been inactive throughout 1918, and governmental regulations have caused operations to be subordinated entirely to war activities. The valuation of permits issued at the principal cities shows a decrease of 17.9 per cent over 1917. The year closes, however, with a very bright prospect for building, and with the removal of all regulations, authorities anticipate that the new year will be one of unprecedented activity. The discovery of oil in the vicinity of Ranger has caused much activity in that section and made local business excellent. The field has been greatly extended, and the general belief seems justified that the Ranger district is destined to become one of the most important oil-producing sections in the United States. LABOR. Labor conditions have been unsettled throughout the year. The wage scale has been very high, but there has been a dearth of work men. The selective draft demoralized forces, causing a scarcity of men, skilled and unskilled, and the substitution of women in large numbers has resulted. In many instances this change has been very satisfactory and the efficiency of organizations in many lines has not materially suffered, and has, we learn, in some establish ments been improved. 100823°—19 44 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

690 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. MONEY MARKET. The year 1918 has proven a year of borrowing rather than liquida tion. The exhibits attached show the large expansion in discount operations, and the extent to which the facilities of this institution have been availed of. There is little evidence at present of any slackening in the demand. It has been the policy of this institution during the year to impress upon member banks the necessity of keeping their assets in a liquid condition, to curtail the extension of credits to those lines essential to the Government's war program, to carefully scrutinize new financing, and by the purchase of Treasury certificates to be prepared to meet their bond payments without inconvenience. Many banks have adhered strictly to this policy, others, less conservative and patriotic, have disregarded our admo nition and as a result have found it difficult, without outside assist ance, to make their instalment payments when due, or "keep their house in order.'' Member banks in the drouth section have had the heaviest de mand throughout the year and had practically no liquidation. On account of disturbed market conditions and the scarcity of ship ping, the 1918 cotton crop moved very slowly, and many banks have been badly extended as a result. Some of them have been carrying large amounts of cotton, bought on a high market, which their customers were always reluctant and usually unwilling to sell on account of the loss involved. Rates have not changed materially and have been steady to firm throughout the year. The heavy demand for funds, and the inevit able credit expansion which resulted, have not, on the whole, unduly disturbed financial conditions, and if immediate relief is afforded by the movement of cotton, as now seems likely, there is no reason why basic conditions should not be sound. DISCOUNT OPERATIONS. REDISCOUNTS—COMMERCIAL PAPER. Schedule 4 shows the discount operations of the bank during 1918. This exhibit covers the rediscounting of commercial, industrial, and agricultural paper. It will be noted that the aggregate of such paper handled in 1918 was $587,677,767, against $57,052,636 in 1917. The total number of banks accommodated in 1918 was 548, of which 205 were new banks which had not previously used our facilities. The largest note discounted was $3,750,000; the smallest, $10.50. REDISCOUNTS—LIBERTY LOAN. Schedule 5 shows by months the volume of paper discounted, including largely member banks' promissory notes secured by Gov- Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 11—-DALLAS. 691 ernment obligations. The amount of such paper handled has been unusually heavy, and the bank's facilities in this regard have been freely availed of by member banks. This method of temporary advances has proven attractive to member banks, but the purpose of the same has unquestionably been often misunderstood, and such facilities not infrequently abused. A large number of banks seem to look upon this institution as an inexhaustible supply of funds, and instead of using its rediscount machinery for the maintenance of reserves have sought advances for their own gain. TRADE ACCEPTANCES. During the past year an increasing number of inquiries have been received as to the use of acceptances, and some of the larger firms of the district have substituted this credit instrument for the openbook accounts. Further progress in this regard is expected, but the transition will be gradual and it will take considerable time to effect the general use of trade acceptances. In the first place, on account of keen competition among wholesalers and jobbers, it is not un likely that the merchant will continue to trade with those firms which permit the open account, with dates of payment uncertain, rather than with their competitors who use acceptances which provide for liquidation at a fixed maturity. Schedule 8 shows the volume of trade acceptances rediscounted by this bank during the year. GROWTH OF OPEN MARKET FOR ACCEPTANCES. The volume of acceptances handled in the open market in this district is negligible. In fact, there p really no "open market'' for this class of paper, the transactions wlhich the bank has handled con sisting principally of purchases fromj the larger banks of their own acceptances, although it has purchjased bills from other Federal Reserve Banks when the demand in (the district was light. POLICY ON ACCEPTANCE PURCHASES. The executive committee has always favored the purchase of acceptances and has made as attractive rates on such paper as market conditions warranted. Schedules 7 (to 10 show total investments in acceptances, maturity of same, and i*ates at which purchased. RESERVE POSITION. The reserve position of the bank {throughout the year is indicated by Exhibit B and attached chartj The required reserves have been fairly well maintained during the year, although during the fall months there was an unprecedented demand for loans, which made it necessary to rediscount with otheif Federal Reserve Banks in order to maintain reserve requirements. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

692 ANNUAL KEPORT OF THE FEDERAL RESERVE BOARD. MOVEMENT OF MEMBERSHIP, NATIONAL BANKS. On January 1, 1918, there were 621 national banks in this district, with a total capital and surplus of $93,732,000. Seventeen national banks, with a total capital and surplus of $5,272,000, have been added during the year; and during the same period eight national banks, with a total capital and surplus of $468,000,. have liquidated. On December 31, 1918, the total national bank membership was 630, with capital and surplus of $96,879,000. The paid-in capital of this bank on December 31, 1917, was $2, 794,- 900, which has been increased by the addition of State banks and through increases in capital and surplus of national banks to $3,154,300 on December 31, 1918. STATE BANKS. On January 1, 1918, there were 11 State bank members in this district, with a capital of $960,000 and total resources of $11,133,000. During the year the bank has made reasonably satisfactory progress in State bank memberships and has added 87 banks, having a total capital and surplus of $7,372,000 and total resources, according to the latest figures available, of $43,305,000. One State bank, with capital and surplus of $63,000, retired from the system by liquida tion during the year. Schedule 15 shows the total membership in the district, by States, as of December 31, 1918. CAPITAL STOCK ACCOUNT. Schedule 17 shows the changes in the capital stock account during the year; also a summary of the movement of member banks. RELATIONS WITH NATIONAL BANK MEMBERS. DISCOUNT OPERATIONS. The relations existing between this bank and its national bank members through discount operations are for the most part extremely cordial and friendly, and the service extended during the past year has been very satisfactory, fully meeting the expectations of members. The exhibits attached show the volume of discount opera tions in 1918. There has been a steady increase in the volume of paper handled. A large number of banks which had not heretofore discounted with the Reserve Banks have availed themselves freely of its facilities. The number of notes offered has been very large. Failure to comply with regulations has necessitated the return of considerable paper on account of ineligibility. An improvement has been shown in this respect during the year, however, and disregard of discount regulations is less frequent than formerly. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT 'NO. 11—DALLAS. 693 FIDUCIARY POWERS. The number of banks in the district which have been granted fiduciary powers up to December 31, 1918, is shown on Schedule 19. Such powers were granted to five banks in 1918. Prior to the pass age of the amendment to the Federal Reserve Act on September 26 the number of such applications was not large. More recently, how ever; several inquiries have been received. Four are now pending, and from the revived interest, as evidenced by inquiries for blanks, it is probably only a question of time until many additional banks will seek these powers. RELATIONS WITH STATE BANKS AND TRUST COMPANIES. DISCOUNT OPERATIONS. As a result of the unfavorable conditions which have existed in parts of the district, and the unprecedented demand for loans, a good many State banks have joined the system largely for the purpose of using the Reserve Bank's rediscount facilities. EXAMINATIONS. The bank's relations with State banks and trust companies in con nection with examinations are confined mainly to the investigation of their condition when they make application for membership. This examination not only enables the executive committee to secure first-hand information regarding the applying bank, and to base its recommendation on the same, but it permits the bank to readily make the analysis required by the Federal Reserve Board. The banking commissioners of the various States in this district furnish two copies of their report of the last examination made. It frequently happens, however, that a State bank has not been recently examined. The reports received from the State banking department would not, therefore, reflect the bank's true condition, and this has led to an independent examination by the Reserve Bank. After a State bank is admitted the department's reports are accepted and it has not been necessary to conduct a special examination of State bank members. RESERVES. The banking laws of Texas have been amended and permit State banks which join the Federal Reserve system to conform to its reserve requirements. As this permits a distinct reduction in reserves it has proven an inducement to State banks to join the system. In the other States in this district, however, the banking laws are not so favorable, and while permitting State banks to join the system, and count balances with the Reserve Bank as part of their required reserve with approved reserve agents, they do not accept the same in lieu Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

694 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. of their statutory requirements. In Louisiana the State law permits balances with the Federal Reserve Bank to count only as cash reserves on hand. This is the sole concession made by the statutes of that State, and the situation obviously interferes with progress in State bank membership in Louisiana. FISCAL AGENCY OPERATIONS, ALLOTMENT OF TREASURY CERTIFICATES AMONG BANKS IN DISTRICT. Schedules 20 and 21 show the allotment of Treasury certificates, the amount subscribed, number of subscribers, and other data cover ing all issues offered in 1918. A very active campaign under the supervision of Mr. Nathan Adams was conducted throughout the year to promote the sale of these securities. While fair headway has been made and the campaign has been reasonably successful, the results, due to the extreme drought and inability to market cotton, have not been as satisfactory as desired. DEPOSITS OF TREASURY FUNDS WITH BANKS AND THEIR WITHDRAWAL. Schedule 22 shows, by months, the amount of funds with depositary banks throughout the year. FLOTATION OF LIBERTY LOANS. During the third Liberty loan campaign the members of the central advisory committee and the executive committee who had served for the first and second loan campaigns continued in office. Mr. J. W. Hoopes again acted as executive manager. Intensive organization work was conducted for two months previous to the actual selling period, business men being sent into practically every county in the district to appoint suitable county chairmen and advise on sales methods. The loan was oversubscribed by nearly $31,000,000. The women's Liberty loan organization, under the chairmanship of Mrs. E. E. Reppert, collected about $23,000,000 in subscriptions. The fourth Liberty loan campaign held in September and October, 1918, under the same management as previous efforts, resulted in an oversubscription of approximately 12 per cent in spite of crop and cattle raising conditions which in some sections were merely unsatis factory and in others deplorable. The women's Liberty loan organi zation collected about $36,000,000. Few bonds were bought as investments by bankers or with a view to helping out in gaining quotas, they doing their part rather in accommodating customers and very effectively pushing the sale of bonds to the public. The work of inducing the public to keep their bonds and to prepare for another loan is being conducted vigorously. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 11 DALLAS. 695 WAR-SAVINGS CERTIFICATES. The activities of the fiscal agency department in connection with the sale of war-savings certificates and stamps have been confined to the receipt and distribution of the stamps. WAR FINANCE CORPORATION. The War Finance Corporation, acting through this bank, has made advances to banks in the cattle-raising and agricultural sections on their promissory notes, secured by the paper of farmers and cattlemen. On July 22 the corporation announced that it would make loans to banks located in drought-stricken sections of the dis trict, such advances to be adequately secured. Up to December 31, 23 applications for loans aggregating $899,263 had been received. Supporting the applications was collateral aggregating $1,185,639. The proposed plan has not been generally availed of, and only 12 applications were accepted by the executive committee and the War Finance Corporation. These applications aggregated $377,000 and were secured by collateral aggregating $520,841. On August 22 the corporation announced its willingness to make advances for crop-moving purposes, but no applications were received. In September the cattle loan agency of the War Finance Corpora tion was opened, the purpose of the organization being to make loans to stock raisers in this district. From the date the agency opened there was a deluge of applications for loans, and the aggregate received up to December 1 was $16,254,312. Of this amount, loans aggregating $3,750,090 were made. In the latter part of November the corpora tion announced that no additional applications would be received after December 1. It is anticipated that the active work of the agency will be closed soon after the beginning of the year. The aid extended by the local cattle loan agency has been of incalculable benefit. Cattle conditions in the West have been quite distressing for many months past on account of the drought; the banks were unable to render necessary financial assistance to their customers among the stockmen. The year closed with conditions greatly improved in the cattle country, and it is hoped that before many months pass the industry will again be on its feet and contribute to the prosperity of the district. The agency reestablished confidence in this industry and brought about a more liberal treatment of such loans both by the banks and the investing public. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

696 ANNUAL KEPOKT OF THE FEDERAL RESERVE BOARD. CAPITAL ISSUES COMMITTEE. In the latter part of January a district or subcommittee of the Capital Issues Committee was appointed, consisting of W. F. Ramsey, chairman; R. L. Van Zandt, vice chairman; Edward Gray, Dallas; Howell E. Smith, McKinney, Tex.; W. C. Stripling, Fort Worth, Tex. An advisory or auxiliary committee was appointed, consisting of Wo R. Grim, Texarkana, Tex.; Edward Rotan, Waco, Tex.; John Sealy, Galveston, Tex.; J. O. Terrell, San Antonio, Tex.; D. E. Waggoner, Dallas, Tex.; E. O. Tenison, Dallas, Tex.; Lewis Hancock, Austin, Tex.; John W. Poe, Roswell, N. Mex.; L. C. Shattuck, Bisbee, Ariz.; R. D. Wilbor, Hugo, Okla.; H. W. Smith, Ruston, La. When the War Finance Corporation Act was passed in April, and the Capital Issues Committee formally created, the above-named gentlemen were reappointed, and have served throughout the year. The activities of the local Capital Issues Committee in the early weeks of its organization were not extensive. As more publicity was given the matter, however, and an active campaign made to conserve capital and credit and restrict the operations of stock salesmen, the number of applications greatly increased, and the functions of the committee expanded materially. The committee, while not attempting to throttle legitimate new financing necessary to the national welfare, has done much to con serve capital and protect the public. The rapid development of the oil fields of Ranger, Burkburnett, and adjacent territory caused the district to be flooded with issues of stocks in oil companies. The majority of such issues were highly speculative, and many of the projects were absolutely without merit. It was, of course, impossible to keep the public, especially in rural communities, from investing in worthless stocks, and many cases were reported of the exchange of Liberty bonds and securities of recognized value for stock in various companies. The committee, however, has constantly endeavored to protect the people from these stock swindlers, and many dishonest operators have felt the effects of its supervisory powers. The following data describes the committee's operations: It is estimated that 250 issues of securities, aggregating $50,000,000, have been passed upon by the committee. Total number of applications withdrawn or abandoned upon the advice of Chairman Ramsey, either through correspondence or at the committee's meetings, 21. Aggregate amount of securities thus discouraged (estimated), $24,107,500. Total number of applicants induced to content themselves with smaller issues than originally applied for, 36. Aggregate amount of these reductions, $1,829,000. Total securities effectively suppressed, $25,937,300. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 11—DALLAS. 697 NOTE ISSUES. FEDERAL RESERVE NOTES. There is attached, as Schedule 24, a chart showing the amount of Federal Reserve notes outstanding in 1918. Schedule 25 shown similar data for 1917. The increase is quite conspicuous. The seasonal movement of currency started about August 1 and continued until the middle of October. During that period our note circulation increased approximately $30,000,000. The amounts issued, by weeks, between those dates were: Week ending— August 3 $375,000 August 10 490, 000 August 17 2,280,000 August 24. 3, 255, 000 August 31 6,640,000 September 7 5, 765, 000 September 14 3,730,000 September 21 3, 345,000 September 28 580,000 October 5 4, 230,000 October 12 1,555,000 October 19 385, 000 The bank has continued its practice of issuing notes to supply currency during the fall crop-moving season and against the deposit of gold. Through the substitution of notes for gold we have greatly strengthened our position. We have conducted an active campaign to increase our gold holdings by the exchange of currency therefor. The reserve against notes outstanding has always been above require ments, and the cover of gold and commercial paper far in excess of the amount required. FEDERAL RESERVE BANK NOTES. The bank has had occasion during the year to issue Federal Re serve bank notes in large amounts, and on December 31 the bank's liability on account of such notes in actual circulation was $5,539,900. POSITION OF COMMERCIAL BANKS AS A RESULT OF WAR FINANCING. INCREASE OF THEIR OBLIGATIONS. The position of commercial banks in this district has fluctuated materially during the year. There is attached, as Schedule 18, a statement showing the condition of national banks on the dates of the first five calls of the comptroller in 1918. On account of the peculiar conditions obtaining in the district during practically the entire year, and the unprecedented demand for funds, the banks have found it necessary to borrow heavily. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

698 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD., EFFECT ON COMMERCIAL PAPER OF DISTRICT. The large amount of the assets of member banks put in Govern ment obligations during the year has resulted in a very dull market for commercial paper. Purchases of such paper have been negli gible. During normal times there is a rather active demand for commercial paper in this district, and in the early months of the year it was the practice of the larger banks especially to make quite an investment in the same, the banks finding commercial paper an attractive investment. In 1919 some of the larger banks employed a portion of their funds in this manner, but the amount so invested has been much smaller than in former years, as surplus funds were not available for that purpose. We do not expect an active market for commercial paper for some time yet; certainly not until the banking situation is more settled. RELATIONS TO AND EFFECT ON GENERAL BUSINESS. The necessity of the banks lending their resources to the Govern ment has forced them to a policy of conservatism, and the extension of new credits has been curtailed. This policy has not interfered unduly with business. It has probably affected the financing of nonessential industries, but this was absolutely necessary in the financial situation of the past year if the Government's requirements were to be successfully met. POLICY TO BE PURSUED IN RESTORING LIQUIDITY OF BANKS. PROBABLE TIME IN WHICH THEY CAN CLEAR UP THEIR " WAR PAPER." Any statement as to the period of carrying "war paper'' or paper secured by Government war obligations would be hazardous. We do not think many banks will desire to carry this paper for long periods, as most of the banks make such loans at low rates of interest, and mainly through patriotic motives. Of course, the time required for the resumption of normal conditions will be an important factor, for, if money matters are not unduly strained and conditions return to normal within a reasonable time, the banks will soon be able to get rid of most of their "war paper." The period of one year could probably be conservatively fixed as the time for liquidating paper of the character referred to. We believe the general public appreciate the importance of holding their Liberty bonds and paying therefor out of their earnings. In extreme cases the assistance of banks will be sought. POLICY OF FEDERAL RESERVE BANK TOWARD THEM MEANWHILE. This bank's policy toward banks which have assisted in the exten sive financial program of the Government will continue to be one of service, and the facilities of this institution will be freely extended in every way consistent with sound banking princinles. At. *V^ Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 11 DALLAS. 699 same time it has been the practice of our officials to discourage undue expansion and restrict advances to legitimate needs until the return ; of normal conditions. We desire to assist the banks in the period of financial readjustment upon which they are now entering, and con fidently expect the transition to be made without undue disturbance. OPERATIONS OF FEDERAL RESERVE BANK BRANCHES. The activities of the El Paso branch during the six and one-half months of its existence have fully justified the wisdom of its estab lishment. Schedule 31 shows the condition of the branch on July 15 (a month after its opening) and on December 31, 1918. Drought conditions in the El Paso section have created a Very heavy demand for funds from the branch. The use of the Reserve Bank's collection facilities has also greatly developed, and the number of items handled daily has increased from approximately 3,000 during the early days of the bank's operations to 7,000 at the close of the year. This increase has been principally from items received from members within the territory of the branch. All nonmember banks in the El Paso branch territory are now remitting for items to the branch at par, except five in Arizona, nine in New Mexico, and nine in Texas. The shipping facilities of the branch for currency and coin have been utilized very freely, and from the day of opening to the end of the year outgoing money shipments were: Currency, $7,400,370; silver, $576,963; gold, $692,865. Incoming shipments during the same period were: Currency, $6,092,659; silver, $530,871; gold, $97,185. A supply of currency and coin sufficient for the needs of the territory served by the branch is kept on hand, as well as a supply of unissued Federal Reserve notes. The branch opened with 60 member banks. There have since been added six State banks, making a total membership on December 31, 1918, of 66. The territory assigned to the branch includes 18 counties in Texas, as follows: Andrews. Hudspeth. Presidio. Brewster. Jeff Davis. Reeves. Crane. Loving. Terrell. Culberson. Martin. Val Verde. Ector. Midland. Ward. El Paso. Pecos. Winkler. Sixteen counties in New Mexico (or all the territory in that State included in the Eleventh District), as follows: Bernalillo. Guadalupe. Sierra. Chaves. Lincoln. Socorro. Curry. Luna. Torrance. Dona Ana. Otero. Valencia. Eddy. Quay. Digitized forG FrRanAtS. ER Roosevelt. http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

700 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. Five counties in Arizona (or all the territory in that State included in the Eleventh District), as follows: Cochise. Greenlee. Santa Cruz. Graham. Pima. The directors appointed by the Federal Reserve Board for the first year were W. W. Turney and A. P. Coles, of El Paso; those selected by the board of directors of the head office were U. S. Stewart and A. F. Kerr, of El Paso, and Sam R. Lawder, of Dallas. Mr. Lawder was appointed manager. All of these gentlemen have been reelected to serve during 1919, and Mr. Lawder was again designated as manager. The branch was opened in quarters on the third floor of the First National Bank Building, together with vault and cage space in the safe deposit section of the First National Bank. These quarters have now proven inadequate and additional room has been arranged for to provide for the rapidly increasing operations of the branch. A force of 14 was employed upon opening on June 17. The work expanded so rapidly that additional clerks were necessary, and on December 31 the force numbered 34, including officers. The executive committee of the branch meets every day to pass upon discount offerings and consider other important matters affect ing operations. A classification of paper under rediscount shows that 80 per cent of the rediscounts for member banks in the El Paso territory are based on live stock and agriculture. Member banks are rapidly learning that as practically all of their payments, on account of withdrawals of funds, maturing obligations, and otherwise, are made through the branch bank, it is to their advantage to accumulate all of their funds there. Banks are also finding it convenient to use the trust department of the branch for the keeping of their Government securities, and as a portion of the general account of the Treasurer of the United States is carried at the branch, Government vouchers are paid by the branch upon presenta tion, and members are given immediate credit for these items. The total expense of operation of the branch from date of opening to December 31 was $61,472.08, which includes cost of equipment, $20,163.01. Revenues from all sources within branch territory for the same period were $81,484.04, which includes earned discount on all rediscounts and member bank collateral notes handled through the branch since the date of opening. MISCELLANEOUS. INTERNAL ORGANIZATION. The board of directors has held 12 meetings during 1918, at which a quorum was present. No change has occurred in the personnel Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTEICT NO. 11—DALLAS. 701 of the board during the year. On December 21, 1917, Mr. W. F. Ramsey was reelected a class C director for the three-year term beginning January 1, 1918, and redesignated as chairman of the board and Federal Reserve agent. On December 11, 1918, he was reappointed chairman and Federal Reserve agent for the year 1919. On the same date Mr. W. B. Newsome was reelected class C director and redesignated deputy chairman of the board for 1919. Mr. Newsome has, upon written request of Chairman Ramsey, and in the latter's enforced absence from the office, generally served as a member of the executive committee. Class A Director B. A. McKinney has at various times during the year served as governor of the bank in the absence of Governor Van Zandt and the necessity of Deputy Governor Hoopes giving attention to Liberty loan matters. The terms of Messrs. John T. Scott, class A director representing banks in group 1, and Frank Kell, class B director representing banks in group 2, expired on December 31, 1918. In accordance with the provisions of the Federal Reserve Act, as amended on September 26 ? 1918, an election of directors was held for the successors of the above named. The polls opened on November 19 and closed Decem ber 3, Messrs. Scott and Kell being reelected to serve for the threeyear term beginning January 1, 1919. Little interest was manifested in the election, and a very small per cent of the banks eligible and entitled to vote took advantage of the privilege. On January 10, Dr. E. P. Wilmot, president of the Austin National Bank, Austin, Tex., was elected a member of the Federal Advisory Council, representing this district. Dr. Wilmot has attended the various meetings of the council, and upon his return made an inter esting oral report to the board of directors. The officers of the bank meet daily from 9.30 to 10 a. m. to discuss various matters of operation and present important correspondence. The executive committee meets daily to pass upon offerings for rediscount and other important matters. It has been the policy of the executive committee to adhere as closely as practicable to the typical organization chart submitted by the Federal Reserve Board in March last. In so doing it has, of course, required a complete reorganization of some departments, and with the natural growth in operations and the creation of new divisions, on account of fiscal agency functions, the bank's force has greatly expanded. To keep the work on a current basis (which has always been the bank's policy) has been extremely difficult. It has been necessary to sub stitute women and untrained men and to educate them in the work of the bank. In the early summer months authority of the Federal Reserve Board for the payment of a salary bonus was obtained. The bonus was distributed on December 31 and amounted to $45,103.59. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

702 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. The selection of Mr. Sam R. Lawder as manager of the El Paso branch created a vacancy in the staff of the head office. Mr. Lawder for several months past had devoted his entire time to work in the war loan department in connection with Assistant Cashier Gilbert. Upon Mr. Lawder's removal to El Paso, Mr. Gilbert, as managing head, remained in sole charge of fiscal agency matters. The work of that bureau developed to such proportions that it was necessary to provide capable assistants, which was done by the appointment of Messrs. D. P. Reordan and Floyd Ikard as assistant managers. At the board meeting on April 5 Mr. Paul G. Taylor, formerly assistant cashier of the South Texas Commercial National Bank of Houston, was elected assistant cashier. Mr. Taylor has immediate supervision of employment of needed help, the district clearing house, bookkeeping, mail and purchasing department, and the private wire operations. At the same meeting Mr. R. B. Coleman, who since September, 1917, had been serving as acting assistant cashier, was elected assistant cashier in immediate charge of the cash division, including currency shipments, vault custodies, and transfers. On June 3 Mr. Fred Harris, manager of the loan and discount department, was elected assistant cashier, continuing in general charge of the discount department. The detailed operations and clerical force of that division are handled by Mr. C. E. Breg, appointed assistant manager in the late summer. Mr. James L. Lumpkin in May last was designated manager of the credit department. Mr. Lumpkin had been acting in that capacity lor several months previously. In August last Mr. John A. Monroe was assigned to the credit depart ment as assistant to Mr. Lumpkin. Mr. R. E. Chambers was in February selected as chief examiner of State banks. Mr. J. H. Blocker, formerly an examiner for the banking department of Texas was employed early in the year to do special examination work under direction of the Federal Reserve agent. Heretofore the duties of both Messrs. Chambers and Blocker, for the most part, consisted in examining State banks applying for membership. There has been no change in the personnel of the Federal Reserve agent's department. Notwithstanding the fact that the work in the department increased greatly during the year, no additions have been made to the force. Under the supervision of Agent Ramsey, the department is handled by Assistant Federal Reserve Agent Charles C. Hall with a force of two. Agent Ramsey, in addition to his work as such, has found it necessary to devote a large portion of his time to the Capital Issues Committee, the cattle loan agency, and drought relief matters. The latter work, which consisted in the distribution of $5,000,000 set aside by the Treasury Department for deposit in banks in the West and Southwest, and the custody and substitution Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 11—DALLAS. 703 of collateral security to the same, has been one of responsibility and much detail. The details of State bank membership, the issuance and receipt of Federal Reserve notes, applications for fiduciary powers, preparation of weekly, monthly, and annual reports, applications affecting mem ber banks' stock holdings, monthly letter on business conditions, and correspondence relating to these matters are handled by Assistant Federal Reserve Agent Hall. CLEARINGS. The check-collection system approved by the Federal Reserve Board, which went into effect July 15, 1916, has been continued throughout the year 1918 with very satisfactory results. There has been a marked increase in the number and amount of checks handled, notwithstanding the fact that no active campaign has been conducted or set program followed in soliciting new clearing accounts or addi tions to the par list. The number of checks handled in January was 378,625, and the amount was $213,811,405. The number handled in December was 725,141, and the amount was $277,583,048, an increase of 91 per cent in the number and of 30 per cent in the amount of items handled during the first and last months of the year. For some time after general clearing operations were undertaken the number of checks handled for account of other Federal Reserve Banks greatly exceeded the number received from and handled for the account of our member banks. The situation is now reversed, and the number of checks deposited by banks of this district consti tutes over 60 per cent of the total number. This increase in the num ber of items and the additions to the number of clearing accounts has created a feeling of optimism, and we believe that the next year will witness an even greater growth and development of the clearing operations of the bank. The majority of items handled for the account of member banks is, of course, received from the larger banks of this district. They find it very much to their advantage, in that it enables them to make quicker collection, obviates the necessity of having their funds scat tered over a wide territory, and saves the expense of extra accounting. A large number of the checks which they receive from their country correspondents are deposited for collection in the district clearing house. A number of country banks, however, which heretofore have preferred sending their miscellaneous items to their city correspond ents, are now availing themselves of the par collection system and find it quite as satisfactory, and in some instances more convenient, because it permits of quicker presentation, quicker advice of non payment, and enables them to maintain their reserve balances with out making so many transfers of funds. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

704 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. One other feature that has no doubt encouraged the use of the par collection facilities was the discontinuance on June 15 of the service charge of 1 i cents on cash items handled through the district clearing house. EFFECT UPON RESERVES. Our method of collecting the amounts of checks forwarded to member banks by making charge to their reserve accounts has not materially affected the reserves for the reason that the charge is not made until sufficient time has elapsed for them to receive our district clearing house letters and make remittance to cover. The banks of this district have become thoroughly familiar with this method and handle our cash letters accordingly. Only occasional delays in the mails cause reserve deficiencies. These are adjusted by making an improvement in reserve accounts, where it is found that deficiency was due to mail delay and not to lack of diligence on the part of the paying bank. . We are satisfied that this method of collection is the quickest and best. It is a safeguard against the holding up of remittances and absolutely assures prompt collection. Under our method of handling checks the maintenance of reserves is very much simplified. A clearing is made of the items received from and items sent to a member bank, and only the net balance is entered in the reserve account. This method permits the member banks to pay for the items we send them with items of similar character. During the year a number of penalties have been assessed for reserve deficiencies and there have been occasional overdrafts, yet the aggre gate reserves have been well maintained. IMMEDIATE CREDIT ENTRY. It would be inconvenient for the majority of our member banks to make settlement of their district clearing house debit balances were it not for the fact that provision has been made to accept for imme diate credit checks and drafts other than those drawn on banks in the Federal Reserve city. In addition to drafts on Dallas, member banks may remit for immediate credit in reserve account drafts drawn on banks in other Federal Reserve cities and points on which other Federal Reserve Banks allow us immediate credit. The reserve city clearing house also provides a convenient facility for the country banks and has been of much assistance to them in making quick settlement of their district clearing house balances. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 11—DALLAS. 705 RESERVE CITY CLEARING HOUSE. The reserve city clearing house, which is now regarded as almost a necessity, has for the year 1918 very well served the purpose for which it was established. It is operated for the convenience of former reserve city banks and at their expense. The members con tinue to send the actual checks and drafts which they receive to the drawee banks for credit. Against these sendings they draw drafts in favor of the Federal Reserve Bank and forward them for their credit in the reserve city clearing house. A clearing is effected and result ant balances are advised by wire. Settlement of balances is made on the same day by charging or crediting reserve account. All members are situated so that mail dispatched for Dallas will be received by the Federal Reserve Bank in time for clearings at 11.30 a. m. This per mits advising of resultant balances by 12 m., and gives the members three hours in which to prepare their reserves to meet the charges. By reason of the members of the reserve city clearing house grant ing permission to the majority of their country correspondents to draw drafts payable through the reserve city clearing house, a large number of the country banks of this district that do not find it convenient to carry a Dallas account are provided with means of making settlement of their district clearing house balances in imme diately available funds. The operation of the reserve city clearing house, in addition to saving for its members one day's time in making collection of the checks they receive drawn on other members, obviates the necessity of handling a great number of miscellaneous items by the Federal Reserve Bank. COLLECTIONS. Upon the authority of the Federal Reserve Board and by its direc tion, the Federal Reserve Bank of Dallas, on January 1, 1918, estab lished a collection department for the handling of all forms of collec tion items, and during the year we have handled for our member banks and other Federal Reserve Banks a total number of 4,962 col lection items, or an average of 413 a month. A circular letter was issued December 27, 1917, to banks of this district, stating the conditions and regulations governing the opera tions of this department. The banks of the district, however, have not made much use of this facility, the majority of our collections being received from other Federal Reserve Banks or from their members. All items handled through this department are sent to banks in the cities where they are payable, and the collecting banks are re quested, if they find it inconvenient to remit in Dallas exchange, to remit to the Federal Reserve Bank of their district for our account. Digitized for FRAS1E0R0 822 °—19 45 http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

706 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. The greater part of our collection business has consisted of items payable at Dallas. GOLD SETTLEMENT FUND. The gold settlement fund continues as an ideal medium for making settlement balances between Federal Reserve Banks and as a stabil izer of the exchange market. It has proven especially valuable in making transfers for the account of the Treasurer, which have been extraordinarily heavy, due to the Government's fiscal activities. Schedule 33 shows the amount of gold this bank received and paid out through the gold settlement fund for the year 1918. In our opinion, a great improvement in operation was made when on July 1, 1918, the Federal Reserve Banks commenced to make daily settlement of their balances through the gold fund. BANKING QUARTERS NEW BUILDING. The bank proper and the fiscal agency department have been seri ously crowded throughout the year, and, as a result, great difficulty has been experienced in handling the increased volume of business. The additional functions undertaken, as a result of the war, and the normal expansion in operations of the bank now find it badly crowded in every department—in fact, the business of all divisions, both of the bank proper and of the fiscal agency, has so greatly expanded that it is necessary to use four different buildings. This, of course, is quite incon venient, to say nothing of the risk involved in the handling of securi ties between the various departments. Because of lack of office space, it was necessary in the early summer months to put on a night force in the discount department. This was in the nature of an experiment, as additional clerks could not be accommodated. It has, however, proven advantageous. The board of directors and the executive committee, after much deliberation and careful thought as to various offers of buildings and lots, in the early fall purchased a site 162 by 183 feet on South Akard Street, one block removed from Commerce Street, one of the princi pal down-town thoroughfares. The location, while slightly out of the principal business and banking district of the city, is very con venient. Plans are now being prepared by the well-known archi tectural firm of Graham, Anderson, Probst & White, of Chicago, for a building adequate for all departments of the bank. The building committee, of which Gov. Van Zandt is chairman, has also employed Thomas Bruce Boyd (Inc.), of New York, to arrange the interior. It is hoped that, without unnecessary delay, the bank will have a structure which will not only answer present needs, but, as far as can be reasonably determined, adequately meet future requirements and care for the rapid growth in its operations. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 11—DALLAS. 707 EXHIBIT A.—Movement of principal earning assets of the Federal Reserve Bank of Dallas during the calendar year 19IS. [In thousands of dollars; i. e., 000 omitted.] Dis p c c U u a S o r p n u t e e a i n d r t t t e e e s s b d d e y O c p t o h a u e p n r e t d r e . d i s (1+2) m i b n o B a o u r il k p g ls e e h n t t . b c b i o T o l a u l u o s n n g t d d a t h e l i t d s . Pe ( r 1 - c 5 e ) n t. e a a T s r o s n e t i a t n s l g . war obli gations. 1 2 3 4 5 6 7 Jan. 4 5,255 3,742 8,997 13,623 22,620 23.2 30,813 Jan. 11 4,657 3,978 8,635 13,563 22,198 21.0 30,389 Jan. 18 4,998 3,651 8,649 13,531 22,180 22.5 29,924 Jan. 25 5,218 4,281 9,499 « 13,263 22, 762 ; 22.9 29,970 Feb. 1 5,490 5,148 10,638 12,445 23,083 1 23.8 30,858 Feb. 8 5,611 5,384 10,995 12,171 23,166 24.2 31,288 Feb. 15 2,257 5,871 8,128 11,291 19,419 11.6 27,522 Feb. 21 2,369 5,935 8,304 9,971 18,275 13.0 25,949 Mar. 1 4,021 6,718 10, 739 10, 722 21,461 i 18.7 29,392 Mar.8 4,445 8,238 12,683 10,060 22,743 19.5 31,585 Mar. 15 3,725 8,114 11,839 8,110 19.949 18.7 28,694 Mar. 22 5,664 8,142 13,806 6,417 20,223 28.0 28,948 Mar.29 8,415 9,953 18,368 5,480 23,848 35.3 32,678 11,160 11,175 22,335 5,256 27,591 40.4 36,078 Apr. 12 12,840 11,569 24,409 5,927 30,336 42.3 39,049 Apr. 19 13,078 12,211 25,289 4,980 30,269 43.2 38, 753 Apr. 26 13,448 12,719 26,167 4,555 30, 722 43.8 38,672 May3 13,379 13,139 26,518 4,980 31, 478 42.5 39,511 May 10 13,452 14,253 27,705 1,555 29,260 46.0 36,272 May 17 11,668 15,465 27,133 845 27,978 41.7 35,028 May 24 12,407 15, 753 28,160 770 28,930 42.9 35,484 May 31 14, 289 15, 793 30,082 920 31,002 46.1 37,046 June 7 17,070 16,373 33,443 720 34,163 50.0 40,153 June 14 19,265 17,594 36,859 1,320 38,179 50.5 44,117 June 21 15,321 13,431 28,752 1,170 29,922 51.2 35,393 June 28 12, 428 14,738 27,166 1,650 28,816 43.1 34,270 July 5 15,312 12,646 27,958 1,630 29,588 51.8 34,517 July 12 12,642 16,119 28, 761 1,380 30,141 41.9 35,037 July 19 13,176 18,676 31,852 1.550 33, 402 39.4 38,314 July 28 15, 789 22,427 38,216 1,320 39,536 39.9 44,453 Aug. 2 14,918 15,023 29,941 1,120 31,061 48.0 35,970 Aug. 9 20,817 16,978 37, 795 971 38, 766 53.7 43,671 Aug. 16 21,205 18,351 39,556 470 40,026 53.0 45,276 Aug. 23 22, 849 20,068 42,917 634 43,551 52.5 48.799 Aug. 30 24, 729 17, 702 42, 431 619 43,050 57.4 48,299 Sept. 6 23,906 21,666 45,572 554 46,126 51.8 51,754 Sept. 13 24, 435 21, 924 46,359 634 46,993 52.0 52,621 Sept. 20 28,504 23,085 51,589 695 52,284 54.5 57,163 Sept. 27 30,815 25,193 56,008 1,300 57,308 53.8 62,437 Oct. 4 27, 703 25,155 52,858 1,910 54, 768 50.6 60,417 Oct. 10 30,008 26,947 56,955 1,925 58,880 51.0 1 64,529 Oct. 18 29,009 27,658 56,667 1,700 58,367 49.7 63,516 Oct. 25 15,672 30,005 45,677 2,400 48,077 32.6 53,189 Nov. 1 20,336 29,750 50,086 2,195 52,281 38.9 58,188 Nov. 8 14,394 28,995 43,389 2,940 46,329 31.1 52,234 Nov. 15 13,887 28, 768 42,655 1 2,910 45,565 30.5 1 51,470 Nov. 22 15,971 29,749 45, 720 3,585 49,305 32.4 ! 55,209 Nov. 29 16, 646 32,327 48,973 4,025 52,998 31.4 1 59,398 Dec. 6 18,048 31, 800 49,848 1 3,600 53, 448 33.8 1 60,358 Dec. 13 16,666 32,898 49,564 3,300 52,864 31.5 59,779 Dec. 20 9,711 31, 765 41, 476 1 2,403 43, 879 22.1 54, 779 Dec. 27 19,705 31,229 50,934 2,678 53,612 36.8 61,512 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

708 AK^UAL REPORT OF THE FEDERAL RESERVE BOARD. FEDERAL RESERVE BANK OF DALLAS* MOVEMENT OFEAR/i/NGASSETS ^DURING THE CALENDAR rEAR/918 ~^(%Lrpe3;3ite2)iscoimte&and>3fougk£. C^e4:7otal€xnurt4Jlssete, tncl. tt$. Government! Securities. ChrpcStJtatio tfW&r&aiiffiuter CoJotal Sills tfisccunCed ancLJfoagkt;. ItfH ss\\ \\5Dl SD\ \\4S4t 60\4S \vfo\ m\ \\3Sl 3S\ \\30\ •30] \\XA 2S\ \m 20\ \/SA WS\ \/OA *>\ \SA \S \0\ \0 YO 411BXI3 ISniS tSZZ29£IZ8X3l0l7&3!ZHllXSJ2t9aS23!6Z3306!3&m!U8X[8l5Z296&Z]2A JAN. | FCB.\ MCH.\APR.\ MAY \JUNE\ JULY I AUG.\SEPT.\ OCT. I MOV. DEO. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 11—DALLAS. 709 EXHIBIT B.—Movement of cash reserves, net deposits, Federal Reserve note liabilities, and the reserve percentage of the Federal Reserve Bank of Dallas, during the calendar par 1918. [In thousands of dollars; i.e., 000 omitted.] Ratio of cash re Federal serves to T r o es ta e l r v c e a s s . h N po et s i d ts e . a R n c o t e u t s e a e s l r i c v n i e r (2+3) n a e e t n r d a d l e F R p e o e d s it culation. serve note liabilities combined. Jan. 4.. 63,923 45,490 46,523 92,013 69.5 Jan. 11. 59,243 40,872 46,073 86,945 68.1 Jan. IS. 54,604 36,298 45,510 81,808 66.8 Jan. 25. 55,395 37,994 44,617 82,611 67.1 Feb. 1.. 53,190 37,033 44,251 81,284 65.4 Feb. 8.. 51,700 36,711 43,507 80,218 64.4 Feb. 15. 55,044 36,826 42,976 79,802 69.0 Feb. 21. 53,971 34,769 42,369 77,138 70.0 Mar. 1.. 49,435 34,229 41,815 76,044 65.0 Mar. 8.. 47,244 34,575 41,453 76,028 62.1 Mar. 15. 47,036 31,777 41,150 72,927 64.5 Mar. 22. 47,768 33,139 40,760 73,899 64.6 Mar. 29. 43,449 33,173 40,096 73,269 59.3 Apr. 5.. 36,952 30,605 39,525 70,130 52.7 Apr. 12. 34,983 34,254 36,850 71,104 49.2 Apr. 19. 33,792 33,357 36,227 69,584 48.6 Apr. 26. 35,374 35,445 35,622 71,067 49.8 May 3.. 31,344 32,588 35,207 67,795 46.2 May 10. 37,305 35,844 34,740 70,584 52.9 May 17. 37,743 35,518 34,131 69,649 54.2 May 24. 39,012 37,802 33,557 71,359 54.7 May 31. 38,145 38,807 33,198 72,005 53.0 June 7.. 36,902 39,766 34,073 73,839 50.0 June 14. 31,058 38,164 33,758 71,922 43.2 June 21. 34,603 33,828 33,254 67,082 51.6 June 28. 32,596 31,037 32,626 63,663 51.2 July 5.. 34.758 32,859 33,328 66,187 52.5 July 12. 36,420 35,064 33.190 68,254 53.4 July 19. 36,166 38,268 32,984 71,252 50.8 July 26. 36,543 44,962 32,750 77,712 47.0 Aug. 2.. 30,455 29,761 33,020 62,781 48.5 Aug. 9.. 31,290 36,178 33,154 69,332 45.1 Aug. 16. 35,115 39,727 34,852 74,579 47.1 Aug. 23. 30,222 34,985 38,079 73,064 41.4 Aug. 30. 32,360 31,396 43,304 74,700 43.3 Sept. 6. 33,335 28,775 50,384 79,159 42.1 Sept. 13 38,661 32,342 53,223 85,565 45.2 Sept. 23 41,483 36,919 56,398 93,317 44.5 Sept. 27 38,674 38,440 57.191 95,631 40.4 Oct. 4.. 41,187 34,655 61,150 95,805 43.0 Oct. 10. 39,008 34,586 62,373 96,959 40.2 Oct. 18. 41,384 35,951 62,512 98,463 42.0 Oct. 25. 43,368 28,097 61,942 90,039 48.2 Nov. 1.. 47,712 38,493 60,860 99,353 48.0 Nov. 8.. 48,083 31,765 62.192 93,957 51.2 Nov. 15. 48,438 32,066 61,063 93,129 52.9 Nov. 22. 34,833 23,185 59,847 83,032 42.0 Nov. 29. 38,337 31,337 58,792 90,129 42.5 Bee. 6.. 38,539 32,018 59,286 91,304 42.2 Dec. 13. 37,757 31,125 58,360 89,485 42.2 Dec. 20. 40,436 26,621 59,666 86,287 46.3 Dec. 27. 35,353 28,046 59,578 87,624 40.9 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

710 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. EEDERALRESERVEBANKOE DALLAS. DEPOSIT AND NOTE LIABILITIES, §1 ALSO CASH RESERVES, DURING THE CALENDAR TEAR 1918. I Carvel:JVet2>eitosUs. CurreZiJotaLCashsWaserves. 1 Curv64:&a£Co ofGotsKJleserva toJlggregate I Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 11 DALLAS. 711 SCHEDULE 1.—Comparative statement of earnings and expenses of bank for years 1916, 1917, and 1918, and since organization. 1918 1916 Since organization. EARNINGS. Bills discounted, members $1,477,035.49 $198,571.22 $205,232.29 $2,123, 074.96 Bills discounted, other Federal Reserve Banks. 20,343.34 10,493.44 30, 836.78 Acceptances bought in open market 175,884.70 138,512.74 10,879.64 325, 277.08 United States bonds and Treasury notes 152,159.48 159,431.61 64,576.25 376, 802.22 Municipal warrants 7,995.08 6,832.79 736.80 15, 853.57 Profits realized on United States securities 4,007.67 4, 007.67 Transfers, net earnings 149,732.95 34,027.34 7,305.20 192, 285.14 Deficient reserve, penalties 56,304.89 12,968.16 69, 273.05 Sundry profits 8,106.16 3,747.42 18,144.46 30, 283.56 Bill of lading drafts 13,641.29 13, 641.29 Service charges (net) 28,322.70 28, 322.70 Total. 2,089,526.08 568,592.39 306,874.64 3,209,658.02 EXPENSES. Assessment account expense Federal Reserve Board 15,222.96 11,438.78 9,664.82 63,537.82 Federal Advisory Council expenses 1,894.06 150.00 752.80 3,240.27 Governors' Conferences 232.20 398.42 1,300.80 1,931.42 Federal Reserve Agents' Conferences 421.66 207.64 613.55 1,242.85 Salaries: Bank officers 68,544.44 41,050.54 33,055.08 179,495.66 Clerical staff 170,134.31 39,940.27 28,361.56 273,551.54 Special officers and watchmen 4,313.68 2,761.68 1,771.02 9,275.38 All other 5,463.64 2,980.78 2,585.33 13,076.75 Directors' remuneration and expenses 4,442.05 3,521.89 4,259.10 18,147.85 Officers' and clerks' traveling expenses 7,756.95 1,138.77 1,234.33 12,710.68 Legal fees 2,215.00 2,400.00 2,422.40 7,451.25 Rent 658.50 10,738.28 Taxes and fire insurance 1,211.12 927.20 4,650.30 Telephone 1,882.50 869.47 871.74 4,270.79 Telegraph 9,667.78 584.46 645.24 11,353.58 Postage 24,688.43 3,166.32 3,088.43 34,814.81 Expressage 28,842.84 8,424.31 10,783.23 59,533.71 Insurance and premiums on fidelity bonds 10,774.23 1,517.92 476.73 17,145.37 Light, heat, and power 2,413.82 1,468.24 1,318.65 5,379.11 Printing and stationery 25,072.20 6,327.37 496.97 41,308.27 Repairs and alterations 4,805.62 2,472.86 209.30 7,978.71 All others not specified 20,278.20 5,154.00 6,298.69 39,106.77 Cost of Federal Reserve currency issued 82,729.93 30,910.82 12,346.43 133,370.74 Equipment 41,758.32 41,758.32 Total 535,424.44 167,811.74 122,556.20 995,070.23 SCHEDULE 2.—Comparative statement of the Federal Reserve Bank of Dallas. Dec. 31,1918. Dec. 31.1917. Dec. 31.1916. RESOURCES. Bills discounted and bought $47,973,536.64 $22,880,546.54 $3,032,115.69 United States bonds to secure circulation 6,632,400.00 2,732,400.00 2,000,000.00 Other United States bonds and Treasury notes 1,757,400.00 3,193,700.00 3,033,250.00 Investments—municipal warrants 150,458.74 127,318.87 Bill of lading—drafts 682,058.19 11,072.50 Bank premises 220,783.39 136,736.31 144,246.31 Furniture and fixtures 11,000.00 37,164.32 Cash and due from banks (not reserve) 3,073,875.88 5,227,722.99 1,407,448.37 Federal Reserve bank notes on hand 696,500.00 2,732,400.00 2,000,000.00 Actual balance in gold settlement fund 6,923,261.30 24,520,700.00 14,946,500.00 Gold with agent for retirement of outstanding Federal Re serve notes 24,545,645.00 25,036,675.00 22,862,855.00 Gold and lawful money 7,095,685.50 13,896,493.91 5,308,894.50 Gold held with foreign agencies 204,010.61 1,837,500.00 Deferred debits 5,022,023.23 Deferred debits—checks and drafts in process of collection. 9,526,636.32 6,581,975.95 Federal Reserve Banks—transfers bought (net) 4,455,917.04 3,619,774.36 War loan expenses (collectible) 511,736.79 Due from other Federal Reserve Banks (net) 2,295,468.51 Total 115,912,856.98 113,240,141.99 59,932,888.79 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

712 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. SCHEDULE 2.—Comparative statement of the Federal Reserve Bank of Dallas—Continued. Dec. 31, 1918. Dec. 31, 1917. Dec. 31, 1916. LIABILITIES. Capital stock $3,154,300.00 $2,794,900.00 $2,696,050.00 Net profits 226,216.69 217,906.06 33,864.51 Federal Reserve notes issued 60,495,080.00 47,716,950.00 24,162,855.00 Reserve deposits (net) 32,550,876.94 44,155,240.99 25,742,902.95 Government deposits 2,493,217.68 • 6,609,284.55 1,493,691.05 Due to other Federal Reserve banks (net) 1,515,970.49 i;292,435.51 Deferred credits—checks and drafts in process of collection 9,323,668.58 7,497,489.90 2,511,089.77 Federal Reserve bank notes (secured by United States bonds) 6,236,400.00 2,732,400.00 2,000,000.00 Surplus - 592,204.25 Reserve for franchise tax 592,204.24 War Finance Corporation 8,026.10 Reserve for depreciation 240,662.50 Total 115,912,856.98 113,240,141.99 59,932,888.79 SCHEDULE 3.—Earnings, expenses, and dividend payments for calendar year 1918, also amounts carried to surplus fund and reserved for Government franchise taxes. Capital Dec. 31, 1918 $3,154,300.00 Earnings for 1918 2,089,526.08 Expense of operation : $447,888.89 Cost of Federal Reserve currency (including expressage, insurance, etc.)1 82,729.93 Miscellaneous charges account note issues * , None. Repairs, alterations, improvements, etc., to bank building 4,805.62 Furniture and equipment—total amount charged off during year None. Total current expenses. 535,424.44 Net earnings for year 1,554,101.64 Profit and loss, Jan. 1, 1918 205,353.08 Total 1,759,454.72 Less: Depreciation on bank premises 61,736.31 Other depreciation allowances or extraordinary items charged to profit-andloss account - 11,145.01 Amount transferred to account reserved for depreciation on United States bonds 240,662.50 313,543.82 Net amount available for dividends, surplus, and franchise taxes 1,445,910.90 Dividends paid: Date paid June 30, 1918; period covered, July 1, 1917-June 30, 1918 168,871.16 Date paid, Dec. 31, 1918; period covered, July 1, 1918-Dec. 31, 1918 92,328.75 Interest paid on stock surrendered 302.50 Total dividend payments 261,502.41 Carried to surplus fund 592,204.25 Transferred to account "reserve for franchise tax,J 592,204.24 Total 1,445,910.90 SCHEDULE 4.—Discounts. Volume of discounts for 1918: Discouuts for member banks $587,677,767.27 Bankers' acceptances purchased in open market and from other Federal Reserve Banks 33,266,438.76 Total 620,944,206.03 Volume of discounts for 1917: Discounts 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 Total number of banks accommodated in 1918 548 Total number of new banks accommodated in 1918. 205 Largest note rediscounted, $3,750,000.00; smallest, $10.50. 1 Including both Federal Reserve notes and Federal Reserve Bank notes. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 11 DALLAS. 713 SCHEDULE 5.—Rediscounts for 1918, by months, and distribution, by States. Month. Texas. Oklahoma. New Mexico. Arizona. Louisiana. $6,522,196.12 $653,412. 63 9,886,183.09 394,401.99 $52,145. 79 18,966,084.28 $112,74-7.28 842,822.34 $515,000.00 April 33,695.694.49 525,751. 49 900,927.52 79,531.18 1,168.017.32 May 34,514, 488. 73 582,290.82 996,955.92 334,849.53 810,000.00 June 40,342,470.20 559,632.15 1,062,570.46 134,864.57 1,974,427.62 July 45.840.895.35 956,301.98 1,363,669.92 25,880.03 3,687,446.96 August 62,721,903.95 1,324,376.14 1,098,830.81 197,507.27 2,237,602 92 September 68,042,604.53 1,444,401.80 1,242,317.71 259,089.90 3,692,980.11 October 78.256.327.36 1,551,199.15 1,213,461.14 271,181.20 4,130,911.25 November 68,989,177.62 1,176,668.25 774,581.65 207,345. C2 3,751,844.97 December 72,380,719.64 1,323,863.18 978,065.38 265,628. 25 2,642,937.74 Total 540,158,745.36 9,557,232.24 11,521,997.47 1,828,023.31 24,611,768.89 Total paper rediscounted as shown above, $587,677,767.27. SCHEDULE 6.—Discount rates for 1918 and dates on which effective. Class of paper. Time. Jan. 1. Apr. 15. Sept. 5. Per cent. Per cent. Per cent. Industrial and commercial Up to 15 days 4 4 1 41 Do 16 to 60 days 41 4-1 4i Do 61 to 90 days 41 5 1 5 Agricultural and live-stock Up to 15 days 4 4 41 Do 16 to 60 days 41 4^ 4| Do 61 to 90 days 41 5 5 Do 91 days to 6 months 5 51 51 Trade acceptances Up to 15 days 31 4 41 Do 16 to 60 days 31 41 41 Do 61 to 90 days 4 41 41 Member bank rediscounts, United States securi Up to 15 days 3| 4 4 ties. Do 16 to 90 days 4 4i 4i Member bank collateral notes, United States se Up to 15 days 31 4 4 curities. Member bank collateral notes, other securities.. Up to 15 days 4 4 41 SCHEDULE 7.—Classification by maturities of bills discounted in 1918. Due within 15 days $463,304,003.00 Due 16 to 30 days 14,506,472.00 Due 31 to 60 days 37,687,307.00 Due 61 to 90 days 49,113,554.00 Due 91 days to 6 months 23,066,430.00 Total 587,677, 766.00 SCHEDULE 8.—Classification of trade acceptances by maturities. Due within 15 days $137,186.71 Due 16 to 30 days 389,260.18 Due 31 to 60 days 923,320.50 Due 61 to 90 days 606,990. 53 Total 2,056,757.92 SCHEDULE 9.—Bills of lading drafts. Based on grain and grain products $618,093.96 Based on alfalfa 458,865.37 Based on hay 238,076.04 Based on cotton and cotton products 6,756,180.27 Based on miscellaneous produce 401,479.65 Total 8,472,695.29 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

714 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. SCHEDULE 10.—Statement of bankers' acceptances—Rates and time. Purchased at 4f per cent $2, 030,000.00 Purchased at 4^ per cent 9,383,000.00 Purchased at 4£ per cent 6,969,214.02 Purchased at 4| per cent 100,000.00 Purchased at 4 per cent 4,266,013.78 Purchased at 3H per cent 347,534.49 Purchased at 3£ per cent 1,289,133.09 Purchased at 3| per cent 3,340,228.89 Purchased at 3£ per cent 3,247,953.93 Purchased at 3£ per cent 50,000.00 Purchased at 3^ per cent 1,493,360.56 Purchased at 3| per cent 750,000.00 Total 33,266,438.76 TIME CLASSIFICATION. Due within 15 days $1,931,100.00 Due 16 to 30 days 10,501,878.17 Due 31 to 60 days 14,988,908.70 Due 61 to 90 days 5,844,551.89 Total 33,266,438.76 SCHEDULE 11.—Operations in United States bonds and securities for the year 1918. BONDS AND TREASURY NOTES HELD ON DEC. 31, 1917 . Registered 2 per cent consols of 1930 $2,450,900.00 Registered 2 per cent Panamas, series 1938 155,000.00 Registered 2 per cent Panamas, series 1936 126,500.00 Registered 3 per cent conversion bonds, series 1946 507,400.00 Registered 3 per cent conversion bonds, series 1947 726,200.00 Registered 3 per cent 1-year Treasury notes 1,430,000.00 First series 3 J per cent Liberty bonds 477,100.00 Second series" 4 per cent Liberty bonds 53,000.00 Total 5,926,100.00 BONDS AND TREASURY NOTES—PURCHASES, SALES, AND CONVERSIONS. United States 3 per cent 1-year Treasury notes charged to Treasurer of the United States.. $705,000.00 First series 3^ per cent Liberty bonds sold at par 476,500.00 Second series 4 per cent Liberty bonds: Purchased from member banks 50,000.00 Sold at par 101,900.00 Third series 41 per cent Liberty bonds: Purchased from Treasury Department 12,450.00 Sold at par 7,050.00 Fourth series 4£ per cent Liberty bonds 29,500.00 Sold at par 12,800.00 Special 2 per cent Treasury certificates of indebtedness purchased from Treasury Depart ment 3,175,000.00 One-day 2 per cent Treasury certificates of indebtedness: Purchased from Treasury Department 14,000,000.00 Charged to Treasury of United States 14,000,000.00 United States 4 per cent bearer certificates of indebtedness: Purchasedfrom Treasury Department 1,687,000.00 Purchased from member banks 875,000. 00 Sold at par 1,315,000.00 Charged to Treasurer of United States 1,247,000.00 United States 4J per cent bearer certificates of indebtedness: Purchased from Treasury Department 515,000.00 Purchased from member banks 318,500.00 Purchased in the open market 2,000,000.00 Sold at par 2,039,000.00 Charged to Treasurer of United States 294,500.00 BONDS AND TREASURY NOTES HELD ON DEC. 31, 1918. Registered 2 per cent consols of 1930 2,450,900.00 Registered 2 per cent Panamas, series 1938 155,000.00 Registered 2 per cent Panamas, series 1936 126,500.00 Registered 3 per cent conversion bonds, series 1946 507,400.00 Registered 3 per cent conversion bonds, series 1947 726,200.00 Registered 3 per cent one-year Treasury notes 725,000.00 Registered 2 per cent United States special certificates of indebtedness 3,175,000.00 United States 3£ per cent bearer certificates of indebtedness 500,000.00 First series 3| per cent Liberty bonds 600.00 Second series 4 per cent Liberty bonds 1,100.00 Third series 4i per cent Liberty bonds 5,400.00 Fourth series 4f per cent Liberty bonds 16,700.00 Total 8,389,800.00 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

715 DISTRICT NO. 11 DALLAS. SCHEDULE 12.—Purchases of municipal warrants. Maturity Municipality. Rate. Maturity at time of discount. value. Per cent. 4 After 90 days but within 6 months $382,207.98 SCHEDULE 13.—Member banks' collateral notes. Total of member banks' collateral notes $459,888,553.00 Number of banks accommodated in this manner 426 Paper secured by United States bonds and certificates of indebtedness: Member banks' collateral notes 440,935,658.00 Member banks' rediscounts 6,897,430.00 Total 447,833,088.00 SCHEDULE 14.—Average reserves of member banks, 1918. Required re Deficient re Actual reserves. Overdrafts. serves. Excess reserves. serves. January 597,8 22.97 $14,5 40. 52 $37,397,700.00 $5,185,582. 45 February 731,6 29.71 6,3 38. 38 34,955,108. 00 5,770,183. 33 March 651,0 32. 72 565. 92 34,056,119.00 4,585,347.80 April 200,9 61.11 9,7 65. 33 33,174,200. 00 3,969,995.78 May 232 456. 43 56,9 11. 27 30,297,000.00 7,876,545.16 June 374!3 37. 24 58,4 10. 00 27,365,200.00 6,737,727.24 July 013,3 21.88 271,6 40.52 26,698,062. 00 4,234,619.36 August 283,7 41. 46 so:3 88.13 27,555,300.00 609,053.33 September 235,9 90. 97 119;0 29.76 30,541,100. 00 $485,138. 79 October 613;1 59. 65 180,1 42. 43 30,232,100. 00 30,082. 78 November 118,5 07. 53 411,0 43. 43 29,790,600. 00 990,135.90 December 655 621. 39 318.8 57.16 29,891,800.00 581,035.77 344, Yearly average 34, 225,715. 25 155,969.40 30,996,190.75 3,073,555.10 SCHEDULE 15.—Number of member banks, by States, Eleventh Federal Reserve District, Dec. 31, 1918. State. National. State. Total. Arizona 8 2 10 Louisiana 13 1 14 New Mexico 32 5 37 Oklahoma 34 2 36 Texas 543 87 630 Total 630 97 727 SCHEDULE 16.—Total State bank membership, Eleventh Federal Reserve District, Dec. 31, 1918. Total Capital. Surplus. resources. ARIZONA. Safford Bank of Safford $33,000 $40,000 $640,000 Tombstone Cochise County State Bank 30,000 5,000 301,000 LOUISIANA. Lake Providence Lake Providence Bank 25,000 5,000 235,000 NEW MEXICO. Albuquerque American Trust & Savings Bank 100,000 40,000 599,000 Corona Stockmens State Bank 25,000 5,000 190,000 Lovington First Territorial Bank 30,000 50,000 589 000 Mountainair Mountainair State Bank 25,000 10,000 153,000 Digitized fo P r o F rt R al A es S ER Security State Bank 25,000 4,000 206,000 http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

716 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. SCHEDULE 16.—Total State bank membership, Eleventh Federal Reserve District, Dec, 31, 1918—Continued. Capital. Surplus. Total resources. OKLAHOMA. Port Towson. First State Bank , $50,000 $5,000 $460,000 Valliant Farmers State Guaranty Bank. 40,000 11,000 462,000 Alpine Alpine State Bank 30,000 30,000 314,000 Alto Alto State Bank 25,000 7,500 390,562 Alison Anson State Bank 35,000 10,000 223,000 Avery Avery State Bank 25,000 5,000 110,000 Ballinger Ballinger State Bank & Trust Co 60,000 12,000 217,000 Beaumont Guaranty Bank & Trust Co 100,000 12,000 1,229,000 Do Texas Bank & Trust Co 250,000 115,000 2,721,000 Beeville Beeville Bank & Trust Co 50,000 25,000 273,000 Bonliam Fannin County Bank 100,000 50,000 894,000 Do First State Bank 200,000 100,000 1,079,000 Bremond ...do 50,000 10,600 263,000 Brownfield Brownfield State Bank 25,000 25,000 251,000 Canyon First State Bank 25,000 2,500 296,000 Childress Farmers & Mechanics State Bank 50,000 40,000 345,000 Colorado First State Bank 30,000 2,608 92,000 Commerce Citizens State Bank 25,000 2,500 202,000 Corsicana First State Bank 100,000 30,000 840,000 Cuero First State Bank & Trust Co 100,000 38,000 544,000 Dallas Central State Bank 200,000 6,000 2,036,000 Do First State Bank 250,000 35,000 3,702,000 DeKalb , do 50,000 34,937 403,000 Denison , Denison Bank & Trust Co 100,000 25,000 1,659,000 Edgewood Farmers & Merchants State Bank 35,000 5,000 153,000 El Paso El Paso Bank & Trust Co 200,000 1,695,000 Do Rio Grande Valley Bank & Trust Co.... 500.000 90,000 3,613,000 Ennis First Guaranty State Bank & Trust Co. 100,000 20,000 536,000 Flatonia Flatonia State Bank 40,000 2,000 321,000 Franklin First State Bank 30,000 10,000 206,000 Frost Citizens State Bank 25,000 25,000 210,000 Galveston South Texas State Bank 125,000 12,500 1,927,000 Gilmer Gilmer State Bank 50,000 12,500 230,000 Goldthwaite Trent State Bank 50,000 25,000 464,000 Graford First State Bank 25,000 7,000 133,000 Grand Prairie do 40,000 20,200 247,000 Hamlin First State Bank 25,000 10,000 145,000 Hansford Guaranty State Bank 25,000 2,000 83,000 Hereford First State Bank & Trust Co 50,000 50,000 561,000 Hillsboro First State Bank 150,000 15,000 705,000 Italy .... Farmers State Bank 25,000 12,500 299,000 Jacksonville Farmers Guaranty State Bank 50,000 10,000 366,000 Do First Guaranty State Bank 50,000 10,000 533,000 Junction Junction State Bank 50,000 50,000 378,000 Kerens First State Bank 50,000 25,000 402,498 Killeen do 25,000 7,500 171,000 Kirkland .do. 25,000 10,000 157,000 Ladonia .do. 25,000 12,500 423,000 Lamesa .do. 30,000 20,000 251,000 Leonard .do. 50,000 5,000 509,000 Lockney .... Lockney State Bank 25,000 5,500 238,000 Lorenzo First State Bank 25,000 107,000 Lubbock Lubbock State Bank 100,000 17,500 582,000 Do Security State Bank & Trust Co... 100,000 185,000 Memphis Citizens State Bank 75,000 47,500 366,000 Mount Calm First State Bank * 25,000 7,000 126,000 Mount Pleasant- Guaranty State Bank 60,000 15,000 450,000 Nacogdoches Commercial Guaranty State Bank. 100,000 20,000 1,150,000 Normangee First State Bank 25,000 25,000 130,000 Paducah do 50,000 50,000 425,000 Palmer First Guaranty State Bank 25,000 12,500 241,000 Paris First State Bank 150,000 75,000 1,334,000 Do Lamar State Bank & Trust Co 150,000 17,500 1,156,000 Pecos Pecos Valley State Bank 110,000 29,000 553,000 Post City First State Bank 25,000 62,000 Quanah First Guaranty State Bank 100,000 50,000 616,000 Reagan First State Bank 25,000 7,000 123,000 Richardson Citizens State Bank 25,000 3,000 257,000 Rockwall Guaranty State Bank 35,000 1,800 220,000 Royse First State Bank 35,000 15,000 425,000 Rusk Farmers & Merchants State Bank.. 25,000 15,000 281,000 Sabinal First State Bank 30,000 25,000 252,000 Santa Anna ....do 35,000 8,000 182,000 Savoy .....'do 25,000 5,500 171,000 Shamrock Farmers & Merchants State Bank.. 25,000 25,000 303,000 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 11 DALLAS. 717 SCHEDULE 16.—Total State bank membership, Eleventh Federal Reserve District, Dec. SI, 1918.—Continued. Capital. Surplus. Total resources. TEXAS—continued. Sinton Bank of Commerce $25,000 $7,000 $154,000 Stamford First State Bank 55,000 13,000 381,000 Sweetwater.,. Texas Bank & Trust Co 100,000 75,000 365,000 Terrell First State Bank 100,000 60,000 786,000 Tioga First Guaranty State Bank 30,000 7,500 224,000 Trenton Guaranty State Bank 25,000 5,000 105,000 Tyler .do 200,000 55,000 1,085,000 Do Peoples Guaranty State Bank 100,000 25,000 640,000 Weatherford First State Bank 125,000 15,000 577,000 Wharton Security Bank & Trust Co 50,000 6,000 295,000 White Deer First State Bank 25,000 87,000 Winnsboro Merchants & Planters State Bank 50,000 21,000 317,000 Wolfe City First State Bank 50,000 22,000 339,000 Wylie . .do 30,000 15,000 390,000 6,483,000 2,065,645 51,914,000 Capital $6,483,000 Surplus 2,065,645 Total capital and surplus 8,548,645 SCHEDULE 17.—Recapitulation of capital-stock account, 1918. Number of member banks Dec. 31, 1917 (national) 621 Number of member banks Dec. 31,1917 (State) 11 New national banks organized during 1918 17 State banks and trust companies admitted during 1918 : 87 736 National banks liquidating during 1918 8 State banks liquidating during 1918 1 9 Total number member banks Dec. 31,1918 727 Total capital stock Dec. 31, 1917 $5,589,800 Stock allotted member banks for quarter ending— Mar. 31, 1918 $81,500 June 30, 1918 333, 700 Sept. 30, 1918 240, 700 Dec. 31, 1918 112,700 771,600 Total 6,361,400 Stock surrendered quarter ending- Mar. 31, 1918 $12,300 June 30,1918 ... 14,100 Sept. 30, 1918 8,800 Dec. 31, 1918 17,600 52,800 Total capital stock Dec. 31,1918 6,308,600 Total paid-up capital stock Dec. 31,1917 2,794,900 Subscriptions paid in quarter ending- Mar. 31, 1918 $40,750 June 30, 1918 168,350 Sept. 30, 1918 120,350 Dec. 31, 1918 56,350 385,800 Total 3,180,700 Cash subscriptions refunded for surrender of stock quarter ending— Mar. 31, 1918 $6,150 June 30, 1918 7,050 Sept. 30, 1918 4,400 Dec. 31,1918 8,800 26,400 Digitized for FRATSotEalR p aid-up capital Dec. 31,1918, 3,154,300 http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

718 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. SCHEDULE 18.—Combined statement of condition of member national banks, Eleventh Federal Reserve District. [In thousands of dollars.] Number of Number of Number of Number of Number of banks, 619; banks, 623; banks, 626; banks, 627; banks, 628: Mar. 4, May 10, June 29, Aug. 31, Nov.l. 1918. 1918. 1918. 1918. 1918. BESOUKCES. Loans and discounts 407,483 382,853 371,887 385,139 410,219 United States bonds 97,342 121,239 98,288 106,215 118,450 Other bonds, securities, etc 15,267 15,108 15,788 15,622 12,592 All other resources 207,196 182,269 158,984 172,766 186, 753 Total 727,288 701,469 644,947 679,742 728,014 LIABILITIES. Capital stock 60,430 60,999 61,243 61,435 61,770 Surplus 33,862 34,008 34,736 34,816 34,929 Undivided profits 16,659 19,033 16,970 17,923 17,664 National-bank notes outstanding 43,250 43,896 44,001 44,370 44,352 Individual deposits 451,846 440,930 393,868 402,212 399,600 Bank deposits 103,264 70,115 61,729 73,414 73,125 All other liabilities 17,977 32,488 32,400 45,572 96,574 Total 727,288 701,469 644,947 679,742 728,014 SCHEDULE 19.—List of member banks which have been granted fiduciary powers. Application Location. Name of bank. approved. Abilene, Tex , Citizens National Bank July ,1915 Albuquerque, N. Mex.. State National Bank Dec. ,1915 Amanllo, Tex First National Bank June , 1918 Austin, Tex American National Bank Dec. ,1916 Beaumont, Tex First National Bank Apr. ,1916 Bonham, Tex do May ,1915 Campbell, Tex Campbell National Exchange Bank.. Oct. ,1917 Carlsbad, N. Mex First National Bank Oct. ,1917 Colorado, Tex City National Bank Apr. ,1915 Corsicana, Tex Corsicana National Bank Aug. ,1916 Dallas, Tex City National Bank Nov. ,1915 Do National Bank of Commerce Apr. ,1915 Do Tenison National Bank Aug. ,1917 Fort Worth, Tex First National Bank ,.. Aug. ,1915 Do Fort Worth National Bank Apr. ,1918 Do Stockyards National Bank Apr. ,1915 Galveston, Tex First National Bank Nov. ,1915 Granger, Tex do May , 1915 Greenville, Tex Greenville National Exchange Bank. Apr. ,1915 McKinne y, Tex First National Bank Apr. , 1915 Marshall, Tex do Sept. 1,1915 Do Marshall National Bank Oct. ,1915 Mexia, Tex First National Bank May ,1915 Orange, Tex do June ,1917 Palestine, Tex Royal National Bank Dec. ,1917 Port Arthur, Tex First National Bank July , 1915 Rosw D e o l l, N. Mex ... C Fi it r i s z t e N ns a t N io a n ti a o l n B al a n B k a nk r. A M p ai r * . . , , 1 1 9 9 1 1 7 8 San Angelo, Tex , Central National Bank July ,1916 Do First National Bank Apr. ', 1915 Do San Angelo National Bank Oct, ,1917 Sealy, Tex Sealy National Bank July ,1915 Sherman, Tex , Commercial National Bank Dec. ,1918 Shreveport, La do June ,1917 Do First National Bank Feb. ,1916 Stanton, Tex do Apr. ,1915 Troup, Tex do Apr. , 1916 Tucson, Ariz Consolidated National Bank July ',1915 Tyler, Tex , Citizens National Bank Aug. ,1916 Victoria, Tex Victoria National Bank Oct. >, 1916 Wichita Falls, Tex National Bank of Commerce Apr. ,1918 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

719 DISTRICT NO. 11 DALLAS. SCHEDULE 20.—Liberty bond subscriptions—Third loan. State. N b a a t n io k n s. a l State banks. P b r a i n v k a s t . e c I o n r d p i o a v r n i a d d t u io a n ls s . su a b m s T c o r o u i t p n a t t l i o o f n s. Texas $62,808,700 $28,056,350 $4,413,050 $2,034,500 $97,312,600 1,294,350 2,918,350 4,212,700 4,119,400 3,930,000 8,049,400 2,553,800 1,121,150 3,674.950 Oklahoma 1,972,950 998,050 2,971,000 Total 72,749,200 37,023,900 4,413,050 2,034,500 116,220,650 Number of Amount of Amount over State. subscribers. subscriptions. Quota. subscribed. Per cent. Texas 611,741 $97,312,600 $73,910,000 $23,402,600 32 Arizona 16,263 4,212,700 1,500,000 2,712,700 181 Louisiana 41,405 8,049,400 5,500,000 2,549,400 46 New Mexico 26,092 3,674,950 2,550,000 1,124,950 44 Oklahoma 23,709 2,971,000 2,003,500 967,500 48 Total 719,210 116,220,650 85,463,500 30,757,150 36 METHOD OF PAYMENT. Cash $37,786,774.89 Depositary credit * 63,249,947.61 Certificates of indebtedness 15,136,500.00 Total paid 116,173,222.50 Unpaid balance 47,427.50 Grand total 116,220,650.00 LEADING CITIES. Cities. Number of Amount of subscribers. subscriptions. Austin, Tex 7,871 $1,436,800 Beaumont, Tex 8,728 2,258,000 Dallas, Tex 25,116 8,609,150 El Paso, Tex ' 7,979 2,444,950 Fort Worth, Tex 14,733 5,377,100 Galveston, Tex 4,745 2,248,550 Houston, Tex 32,553 9,742,950 San Antonio, Tex 20,832 4,231,650 Waco, Tex 8,947 1,705,900 Shreveport, La 10,841 3,505,400 SCHEDULE 21.—Liberty bond subscriptions—Fourth loan. National Private Individuals Total amount State. banks. State banks. banks. corpo a r n a d t ions. subscr o i f p tions. Texas $79,374,500 $35,756,800 $5,589,850 $3,920,050 $124,641,200 Arizona 1,583,150 3,419,150 50 5,002,350 Louisiana 4,773,350 4,848,800 21,300 9,643,450 New Mexico. r 2,650,400 993,600 109,950 3,753,950 Oklahoma 1,912,950 1,045,950 80,350 3,039,250 Total 90,294,350 46,064,300 5,589,850 4,131,700 146,080,200 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

720 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. SCHEDULE 21.—Liberty bond subscriptions—Fourth loan—Continued. State. N s u ub m s b c e ri r b o f A s m ub o s u c n ri t p o f Quota. o A v m er o s u u n b t Per cent ers. tions. scribed. (over). Texas 632,026 $124,641,200 $107,784,000 $16,857,200 16 Arizona 28,360 5,002,350 4,865,000 137,350 3 Louisiana 46,618 9,643,450 8,631,000 1,012,450 12 New Mexico 23,068 3,753,950 2,031,000 1,722,950 85 Oklahoma-.., 23,888 3,039,250 2,869,000 170,250 6 Total 753,960 146,080,200 126,0O0,00C 20,080,200 16 METHOD OF PAYMENT. Cash $30,961,186.21 Depositary credit 69,194,478. 79 Certificates of indebtedness. 14,586,150.00 Total paid 114,741,815.00 Unpaid balance 31,338,385.00 Grand total 146,080,200.00 LEADING CITIES. Cities. Number of Amount of sub subscribers. scriptions. Austin, Tex 5,461 $1,607,050 Beaumont, Tex 11,840 2,607,450 Dallas, Tex 35,838 12,708,200 El Paso, Tex 9,962 2,830,450 Fort Worth, Tex 18,142 5,939,600 6,840 2,849,400 Houston, Tex 33,185 12,624,450 25,704 5,316,450 Waco, Tex 10,833 4,255,950 Shreveport, La 9,177 2,246,200 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 11—DALLAS. 721 SCHEDULE 22.—Chart showing average monthly balances maintained with war loan de positaries in Eleventh Federal Reserve District, 1918, and par value of securities pledged as collateral to such deposits. Months 1918 ^ 2 <• °» 5? * 5 * ^ | | ^ l ^ ^ ^ £ § ^3 | Collateral (par value) deposited to secure War Loan Deposits. mommy ea win7 aesiCf inacea uepvsiruriett. 1i i\ \ I \ 1 \ 1 \ 1 \ 1 \ 1 \ 1 1 1 \ \ / / \ \ / / / / t 1 \\ \ \ \ >/ i\ \ kA 1 ,''\ \ / i \ I \ / \ I \ / / \ 1 \ / \ ' \ \ / , \ I \ / / \ / \ s / \ / \ s -J/ \ / \ t \ \ l \ SCHEDULE 23.—Applications received by the Cattle Loan Agency up to Dec. SI, 1918. Total number of applications received 678 Aggregate amount .116,254,312.00 Total number of applications approved, on which the money was actually paid 135 Amount actually paid $3,750,090.50 Amount of largest loan paid out $360,000.00 Amount of smallest loan . $l, 500.00 100823°—19 46 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

722 ANNUAL REPORT OF THE INDERAL RESERVE BOARD. SCHEDULE 24—Federal Reserve notes outstanding', year 1918. Jan. Feb. Mar. Apr. May June July Aug. Sept. Oct. Nov. Dec. | K /^ \ / \ / V / / / / / ) \ \ \ V V, ^v \ .sralloD o snoilliM 63 63 62 62 61 61 60 60 59 59 58 58 57 57 56 56 55 55 54 54 53 53 52 52 51 51 5» 50 3 49 49 p? 48 48 o 47 47 de o n 46 4<> 45 4S f o c . » 44 44 CD 43 43 (A 42 42 41 41 40 40 39 39 38 38 37 37 36 36 35 35 34 34 33 33 32 32 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 11 DALLAS. 723 SCHEDULE 25.—Federal Reserve notes outstanding, 1917. J&n Feb Mar Apr May JUn Jul Aug Sep- Oct Nov Dec r J K \ V ,A V r \vV \ v Federal Reserve Notes Outstanding Year of 19 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

724 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. SCHEDULE 26.—Number of Federal Reserve notes, by denominations and aggregate amounts received, issued to the bank, and returned to the comptroller during the year 1918, Number of notes. Aggregate Hun amount. Fives. Tens. Twenties. Fifties. dreds. Received from comptroller 1,700,000 1,068,000 612,000 0 0 $31,420,000 Received from Federal Reserve Bank 429,000 694,000 342,500 22,700 14,200 18,490,000 Received by comptroller from Treasurer of the United States for destruction and credit of Federal Reserve agent's ac count (unfit notes): (a) From other Federal Reserve Banks 269,970 178,651 54,884 565 122 4,274,490 (&) Direct from reporting Federal Reserve Banks and from other sources 388,323 224,745£ 50,685$ 718 137 5,252,380 Total. 2,787,293 2,165,396J 1,060,069$ 23,983 14,459 59,436,870 Issued to Federal Reserve Bank 1,560,000 1,411,500 841,000 10,600 15,300 40,795,000 Returned to Comptroller of the Currency • for destruction, including notes re turned by the United States Treasurer for credit of Federal Reserve agent's account 658,293 403,396$ 105,569* 1,283 259 9,526,870 Total 2,218,293 1,814,896$ 946,569$ 11,883 15,559 50,321,870 SCHEDULE 27.—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. 31, 1918. Number of notes. Aggregate Fives. Tens. Twenties. Fifties. d H re u d n s . amount. Received from comptroller 4,728,000 3,396,000 1,776,000 56,000 40,000 $99,920,000 Received from Federal Reserve Bank 888,250 1,380,350 601,950 52,100 45,950 37,483,750 Received from Treasurer of the United States (fit notes) 350 140 180 13 0 7,400 Received by comptroller from Treasurer of the United States for destruction and credit of Federal Reserve agent's ac count (unfit notes): (a) From other Federal Reserve Banks ^ 379,453 248,577 78,324 834 154 6,006,615 (&) Direct from reporting Federal Reserve Banks and from other sources 1,246,953 591,286 142,604 2,370 291 15,147,305 Total 7,243,006 5,616,353 2,599,058 111,317 86,395 158,565,070 Issued to Federal Reserve Bank 4,636,000 4,255,590 2,171,930 76,013 61,650 119,140,150 Returned to Comptroller of the Currency for destruction, including notes re turned by the United States Treasurer for credit of Federal Reserve agent's account 1,664,006 874,763 226,128 3,204 445 21,794,920 Notes on hand at end of month 943,000 486,000 201,000 32,100 24,300 17,630,000 Total 7,243,0C6 5,616,353 2,599,058 111,317 86,395 158,565,070 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 11—DALLAS. 725 SCHEDULE 28.—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, 1918, to Dec. 31, 1918. Fives. Tens. Twenties. Federal Reserve Bank of— Received Returned j Received Returned | Received Returned from. to. from. to. I from. to. Boston $27,730 $34 500 $72,050 $365,500 $61,020 $25,100 New York. 320,100 216 750 838,000 1,310,500 704,600 506,000 Philadelphia... 47,500 63!;o oo 115,500 243,500 139,500 80,750 Cleveland 8,000 47!, 750 42,000 726,500 53,500 279,000 Richmond 32,500 SO!, 000 57,000 88,000 49,500 103,000 Atlanta 505,460 274! 500 665,720 662,000 556,680 579,000 Chicago 353,500 114! 500 768,000 882,500 631,000 449,000 St. Louis 975,275 256 ,250 1,390,900 621,000 1,153,200 510,000 Minneapolis— 19,500 48;, 000 52,000 99,500 50,000 88,000 Kansas City... 192,500 490:, 500 389,000 807,500 190,000 789,000 San Francisco. 51,310 76 ,250 101,390 133,140 154,260 205,620 Total. 2,533,375 1,702,000 4,491,560 5,939,640 3,743,260 3,614,470 Fifties. Hundreds. Totals. Federal Reserve Bank of— Received Returned Received Returned Received Returned from. to. from. to. from. to. Boston $3,700 $3,400 $2,000 .$3,600 $166,500 $432,100 New York 52,750 40,750 42,200 53,300 1,957,650 2,127,300 Philadelphia 7,000 7,600 10,000 3,100 319,500 397,950 Cleveland 5,450 18,450 3,000 6,600 111,950 1,078,300 Richmond 2,250 8,950 1,000 3,000 142,250 282,950 Atlanta 22,900 123,000 20,500 41,500 1,771,260 1,680,000 Chicago 30,500 30,600 21,000 24,800 1,804,000 1,501,400 St. Louis 39,400 23,850 27,100 25,700 3,585,875 1,436,800 Minneapolis 2,200 3,550 1,800 3,100 125,500 242 150 Kansas City 4,350 103,650 2,100 37,700 777,950 2,228,350 San Francisco 8,350 12,300 6,200 20,600 321,510 447,910 Total 178,850 376,100 136,900 223,000 11,083,945 11,855,210 SCHEDULE 29.—Cost of Federal Reserve notes during year 1918. un C i o s s s t u o e f d . i C ss o u st e o d f . po T r r t a a n ti s o n. Insurance. Total. Balance carried over for 1917 $10,161.62 $10,161.62 January 3,480.62 3,480.62 February 7,477.71 7,477.71 March 9,374.24 9,374.24 May 2,888.24 $73.12 2 961.36 June 987.12 987.12 August 268.56 268. 56 September 767.88 $834. 55 $2,203.20 3,805.63 October 23,896.50 465. 07 120. 00 24 481.57 November 268. 50 479. 25 ' 747.75 December 18,123. 75 500.00 18 623.75 New plates for engraving 360.00 360.00 Total 34,778.87 43,348.99 1,778.87 2,823.20 82,729.93 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

726 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. SCHEDULE 30.—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, 1918. m RESOURCES. Federal Reserve notes on hand $17,630,000.00 Federal Reserve notes outstanding 60,495,080.00 Federal Reserve notes sent to Comptroller of the Currency for destruction 21,794,920.00 Bills to secure Federal Reserve notes '44,429,120.86 Gold coin and certificates on hand 12,581,000.00 Credit balance in gold redemption fund 3,087,295.00 Credit balance with Federal Reserve Board 6,684,000.00 Total 166,701,415.86 LIABILITIES. Federal Reserve notes received from Comptroller of Currency, gross amount $99,920,000.00 Funds received in reduction of liability for Federal Reserve notes 22,352,295.00 Collateral pledged against outstanding Federal Reserve notes 44,429,120.86 Total 166,701,415.86 SCHEDULE 31.—Comparative statements of condition of the El Paso Branch of the Federal Reserve Bank of Dallas as of dates shown. July 15, 1918. Dec. 31, 1918. RESOURCES. Bills discounted, members $2,666,895.51 Member bank collateral notes 858,450.00 Bill of lading drafts $27,447.48 19,070.27 Overdrafts, member banks 2,500.58 Due from head office 405,745.75 Exchanges for clearing house 43,451.33 33,653.14 Collection items, debits 2,469,549.78 1,549,458.62 Trust custodies 1,000.00 743,745.00 Total cash 955,079.33 1,037,830.05 All other resources 3,311.27 55.00 Total 3,908,085.52 6,909,157.59 LIABILITIES. United States Government deposits 315,465.47 Due to member bank-reserve accounts 2,850,496.76 3,277,599.98 Due to head office 138,371.23 Due to nonmember clearing accounts 4,281.37 Collection items, credits..." 901,467.92 1,560,638.64 Cashier's expense and return item checks : 580.53 19,390.02 Federal Reserve notes outstanding 150,000.00 825,000.00 Liabilities as custodian 1,000.00 743,745.00 All other liabilities 258.94 28,947.25 Total 3,908,085.52 6,909,157.59 SCHEDULE 32.—Number and amount of checks (exclusive of Government checks) handled by the Federal Reserve Bank of Dallas for the year 1918. Number. Amount. Jan. 1 to 15 196,716 $111,855, 408 Jan. 16 to Feb. 15. 363,818 203,911,994 Feb. 16 to Mar. 15. 347,204 186,074,240 Mar. 16 to Apr. 15. 438,100 205,646,272 Apr.l6toMayl5. 368,525 180,201,850 May 16 to June 15. 395,275 189,501,375 June 16 to July 15. 530,832 190,621,440 July 16 to Aug. 15. 556,088 201,422,572 Aug. 16 to Sept. 15 581,664 225,973,272 Sept. 16 to Oct. 15. 679,975 287,148,800 Oct. 16 to Nov. 15. 740, 818 314,364,570 Nov. 16 to Dec. 15. 728,664 284,607,312 Dec. 16 to 31 395, 699 154, 306,189 6,323,378 2,741,224,294 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT HO. 11—DALLAS. 727 SCHEDULE 33.—Funds paid out and received through gold settlement fund during year 1918. PAYMENTS BY MONTHS. Debit. Credit. January $93, 529,400.00 $89, 063,000.00 February.. 78, 976,400.00 69, 269,000.00 March 75, 878,900.00 77, 279,670.00 April 71 533,100.00 70, 180,160.00 May 86; 377, 650.00 83, 968,660.00 June 73: 996,923.00 74, 702,602.00 July 82; 821,652.65 76 804,864.73 August 92; 991,598.16 95, 909,874.45 September. 98, 211,732.38 95, 183,126.72 October 119', 795,524.67 127, 653,709.82 November. 138, 609,716.64 132, 491,263.79 December.. 129, 200,886.24 131 820,063.53 Total 1,141,923,433.74 1,124,325,995.04 Balance Dec. 31,1917, brought forward. 24,520,700.00 Balance Dec. 31,1918 6,923,261.30 1,148,846,695.04 1,148,846,695.04 Gold settlement fund balances, Dec. 31,1918.. 6,923,261.30 SCHEDULE 34.—Statement showing, by months, the gold settlement fund settlements and resultant balances, both debit and credit, for year 1918. Funds wired by Funds wired to Month. us. us. Debit balance. Credit balance. January $80,812,000.00 $81,742,000.00 $930, 000.00 February.. 65,782,000.00 67,497,000.00 1,715/ 000.00 March 61,011,000.00 66,250,000.00 5,239, 000.00 April 64,961,000.00 59,855,000.00 $5,106,000.00 May 70,778,000.00 81,433,000.00 10,665,0 00.00 June 60,343,000.00 60,984,000.00 641, 000.00 July 68,715,026.40 70,980,625.48 2,265,5 99.08 August 67,877,363.16 90,597,524. 45 22,720, 161.29 September. 68,279,677.38 94,914,646.72 26,634' 969.34 October 95,806,442.65 122,590,379.82 26,783, 937.17 November. 96,301,956.74 102,370,691.29 734.55 December.. 109,685,991.32 97,898,003.63 11,787,987.6 Total for year. 910,353,457.65 997,112,871.39 16,893,987.67 103,653,401.43 Net for year 86,759,413.74 36,759,413.74 SCHEDULE 35.—Statement showing amount of currency and coin shipped to member banks, by months, during 1918, detailed as to nature and denomination. [Including El Paso Branch.] PAPER MONEY. Ones and Month. twos. Fives. Tens. Twenties. Other. January $18,1,500 $90,500 $217,500 $248,000 $766,500 February... 239,000 305,250 436,000 535,500 156,000 March 211,895 146,550 607,520 563,840 83,000 April 280,632 247,150 460,040 469,600 196,050 May , 388,510 504,970 798,195 934,520 102,300 June 649,107 1,148,155 1,458,530 1,205,260 187,400 July 645,045 1,090,305 1,757,890 1,714,600 151,000 August 559,995 2., 898,100 5,429,110 6,357,780 290,500 September. 1,024,570 3,000,155 5,867,880 5,822,460 236,500 October... 447,607 766,010 2,260,260 2,293,460 224,000 November. 303,594 342,295 955,820 1,225,990 112,000 December. 483,095 1,220,600 1,814,350 1,783,100 905,500 Total 5,414,550 11,760,040 22,063,095 23,154,110 3,410,750 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

728 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. SCHEDULE 35.—Statement showing amount of currency and coin shipped to member banks, by months, during 1918, detailed as to nature and denomination—Continued. SILVER AND SUBSIDIARY COIN. 50, 25, and 10 Nickels and Total, paper Month. Ones. cent pieces. pennies. and silver. January.... $500 $18,260.00 $7,270.00 $1,530, 030.00 February.. 36,700 28,750.00 9,640.00 1,746, 840.00 March 38,790 44,475.65 11,220.68 1,707, 291.33 April 42,700 42,500.00 10,220.00 1,748, 892.00 May 46,000 48,900.00 14,515.00 2,837, 910.00 June 75,400 132,350.00 18,662.50 4,874 864.50 July 231,530 224,200.00 22,642.00 5,837', 212.00 August 235,600 226,150.00 34,950-00 16,032, 185.00 September. 301,050 293,750.00 43,950.00 16,590, 315.00 October 56,265 87,250.00 18,310.00 6,153, 162.00 November. 55,850 66,702.50 16,460.00 3,078, 711.50 December.. 59,440 184,900.30 23,505.02 6,474, 490.32 Total. 1,179,825 1,398,188.45 231,345.20 68,611,903.65 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 expansion of the Federal Reserve Bank of San Francisco during the period from April 6, 1917, when the United States de clared war, to December 31, 1918, is shown in the comparative state ment in Schedule 1. Deposits of member banks have increased from $38,497,162 to $73,235,000; bills discounted for member banks from $340,372 on April 6, 1917, to $25,780,201 on December 31, 1917, and to $78,759,000 on December 31, 1918; gold reserves from $41,030,130 on April 6, 1917, to $94,018,470 on December 31, 1917, and to $150,973,000 on December 31, 1918; Federal Reserve note circulation from $15,398,695 on April 6, 1917, to $67,744,305 on December 31, 1917, and to $212,243,000 on December 31, 1918. EARNINGS,, EXPENSES, AND DIVIDENDS. Net earnings of $547,043.86 in 1917 rose to $2,869,164.14 in 1918. Dividends at the rate of 6 per cent per annum for the period January 1, 1917, to December 31, 1918, were paid, amounting to $497,674.40, and $2,448,175.11 credited, half to surplus account and half to the United States Government as a franchise tax. A comparative state ment of earnings and expenses is given in Schedule 2. GENERAL BUSINESS CONDITIONS. Unprecedented agricultural, commercial, and industrial activity, with equally unprecedented profits, has prevailed throughout this district during the war, the largest industrial development having been in shipbuilding. Of 408 ships, aggregating 2,376,362 tons dead weight, built and delivered to the United States Shipping Board between August, 1917, and October 1, 191*8, 162, of 1,149,685 tons, were built in this district, the estimated value of ships produced on the Pacific coast during 1918 being over $500,000,000. In spite of the armistice, steel shipbuilding is proceeding at an undiminished pace, but wx>od shipbuilding has practically ceased for the time being, 729 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

730 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. Agriculture remains the principal industry of the district; produc tion during the war having been increased to some extent by urgent need and high prices. The Department of Agriculture estimates the value of the agricultural products of this district during 1918 at $851,427,000, as compared with $822,579,000 in 1917. That this increased value is partly the result of increased yield is evidenced by the following examples: In this district production of wheat totaled 79,584,000 bushels as compared with 70,899,000 bushels in 1917; of sugar beets more than 2,600,000 tons, as compared with 2,400,000 in 1917; of California rice approximately 400,000,000 pounds, as compared with 280,000,000 in 1917; of beans in Cali fornia 8,868,000 bushels as compared with 8,091,000 in 1917; the area planted to cotton in Arizona 92,000 acres, as compared with 46,000 in 1917, and in California 194,000, as compared with 117,000 in 1917. Shipments of California deciduous fruits totaled 28,204 cars, as compared with 24,961 in 1917. The year has been generally favorable for agricultural products, as shown in the comparative statement of production in Schedules 3, 4, and 5. The salmon pack of the Pacific Northwest is estimated at 9,300,000 cases, which is approximately 825,000 less than in 1917. The south ern California fish pack, chiefly of tuna and sardines, was 52,000 cases in excess of the 1917 pack, amounting this year to 1,075,000 cases. Change in statistical methods makes accurate comparison of changes in stored stocks of California petroleum impossible. Stored stocks, which on December 31,1917, totaled 30,450,465 barrels, were reported on October 31, 1918, as 37,400,859. This increase is due almost entirely to exclusion of refinery stocks from the former figures and their inclusion in the latter, production having approximated con sumption. Stored stocks, exclusive of refinery stocks, amounted on December 31, 1915, to 57,147,051 barrels and on December 31, 1916, to 44,036,190 barrels. The lumber situation has been exceptionally complex, due to labor problems, changed character of demands, car shortage, and the uncer tainty regarding wooden ships. However, the volume of production and of consumption has been practically normal. Following the signing of the armistice, all Government lumber contracts were can celed, causing temporarily upset conditions, but as the year closes the situation is favorable. Labor has been fully employed at an unprecedently high level of wages. There has been some agitation and dissatisfaction, but labor disturbances have been at a minimum during the year. Building permits throughout the district have shown a decided decrease, due to the request of the Government that all unnecessary building be postponed until after the termination of the war. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTBICT NO. 12 SAN FRANCISCO. 731 Bank clearings have ranged between 25 per cent and 30 per cent in excess of those of 1917. Import and export trade, in spite of shortage of shipping space, is at record point in values. Washington (Seattle and Tacoma) foreign trade exceeds that of California (San Francisco and Los Angeles), the totals for the first 10 months of 1918 amounting to $493,393,000 and $404,333,000, respectively. Imports and exports from Oregon ports totaled $12,784,000. Comparative statements of building permits, bank clearings, and foreign trade are given in Schedules 6 to 8. Money rates have been stable, there being a steady and active demand, with rates firm at 6 per cent in industrial centers and 7 per cent in agricultural communities. DISCOUNT OPERATIONS. REDISCOUNTS COMMERCIAL PAPER. Discounts which, during 1916, aggregated $1,973,355 expanded to a total of $102,981,205 during 1917 and $941,441,337 during 1918. Rediscounts of commercial paper exceeded discounts of collateral notes during the major portion of the year. Holdings of such redis counts increased from $24,211,000 on January 1 to $34,326,000 on July 5, the first date on which they exceeded $30,000,000. They reached their peak, $49,152,000, on September 13, after which date they gradually decreased, amounting on November 30 to $30,038,000 and on December 31 to $33,732,000. Particular assistance was granted in the Northwest in handling the grain crop and the wool clip. A steadily growing tendency to offer short maturities has been manifested. REDISCOUNTS LIBERTY LOANS. Holdings of member banks' notes, practically all secured by Gov ernment obligations, totaled $2,533,000 on January 1. These gradu ally increased until on April 26 the amount held reached $10,904,000, the daily holdings fluctuating during the succeeding months between $10,000,000 and $20,000,000, reaching $22,299,000 on August 2 and increasing from that date until October 10, when they were $61,- 561,000. Following the close of the fourth Liberty loan campaign, holdings of such paper gradually declined, amounting to $44,136,000 on November 30 and $45,027,000 on December 31. TRADE ACCEPTANCES. There has been increased interest in trade acceptances and their volume is expanding, several conventions of retail and wholesale dealers and various credit men's associations on the Pacific coast having indorsed their use. Chambers of commerce and associations of merchants have made greater efforts than bankers to secure their adoption. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

732 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. BANKERS' ACCEPTANCES. This bank has bid consistently for all offerings of prime bankers7 acceptances originating in this district, whether offered locally or from other districts, thereby maintaining a market for them in this district as constant and stable as that of New York for acceptances originating there. The rates bid have been, as nearly as ascertainable, identical with those prevailing in New York. The principal market being in New York, and the obligation resting upon the whole Federal Reserve system to maintain an open market under all conditions for bankers' acceptances, this bank has regularly participated pro rata in the purchases of acceptances by the Federal Reserve Bank of New York, and on occasions has also made purchases from other Federal Reserve Banks needing to replenish reserves. Some banks in this district are buyers of acceptances from time to time, but their purchases are usually made either when offered by their customers for discount or through purchases in the New York market. With only a small volume of bankers' acceptances originat ing in this district and even these being offered intermittently, it has been obviously more convenient for a bank in this district to adjust its investments from day to day by purchases in the New York market where there is a sufficient volume to make daily purchases possible, but in some cases this bank has sold bankers' acceptances to its member banks and is disposed to extend this service more generally with a view to broadening the market. RESERVE POSITION. Exhibit B shows the reserve position throughout the year. The heavy demands of member banks resulted in a considerable decrease in the reserve percentages. On January 11 the reserve percentage, 73.1 per cent, was the highest at any time during the year. At that time gold held equaled $104,939,000, and combined deposit and Federal Reserve note liability, $144,125,000. In spite of the large increase in gold holdings there was a gradual reduction in the reserve percentage, the lowest point being reached on October 25, when $126,114,000 of gold held amounted to only 46.2 per cent of $272,809,000 combined deposit and Federal Reserve note liability. After the latter date, reserves increased somewhat, rising to 57.4 per cent on December 31, when the gold holdings were $150,973,000 and combined deposit and Federal Reserve note liability $262,939,000. During a large part of the year reserves ranged between 57 and 67 per cent. That they did not fall below 46.2 per cent is due to the cooperation of the banks of this district in forwarding their gold to the Federal Reserve Bank for its reserve. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 12-—SAN FRANCISCO. 733 MOVEMENT OF MEMBERSHIP. NATIONAL BANKS. During the past year the number of national banks in this district has increased from 530 to 554. This increase consisted of 14 newly organized banks and 15 conversions of State banks, and was par tially offset by the liquidation of 5 banks. Of these, two were absorbed by State banks, two by national banks, and one failed. A statement showing the movement in membership by States appears in Schedule 9. STATE BANKS. The number of State member banks in this district increased from 17 on December 31, 1917, with combined capital and surplus of $5,820,000 and resources of $65,697,000, to 86 on December 31, 1918, with combined capital and surplus of $16,061,000 and resources of $160,690,000. A list of State member banks, with capital, surplus, and resources, appears in Schedule 10. Active and definite inclination for membership has been mani fested in Washington, Idaho, Utah, and Oregon, in which four States 81 of the 86 State member banks are located. With the opening of a branch of the Federal Reserve Bank in Salt Lake City on April 1, 1918, all eligible State banks in that city immediately applied for membership, followed by other banks in the sections served by this branch. On April 16, 1918, Mr. R. L. Rutter, president of the Spokane & Eastern Trust Co., Spokane, Wash., a member bank, was appointed Twelfth Federal Reserve District member of the Federal Reserve membership campaign committee of the American Bankers Asso ciation, a committee having for its purpose the conduct of a campaign of education to make clear to nonmember banks the advantages of membership. His effective efforts have led to a considerable increase in State bank membership. The resources of California State banks approximate half those of all State banks in this district, but, in spite of the appeal of the President that all eligible State banks as a patriotic duty join the Federal Reserve system, only four California State banks, with ap proximately eight-tenths of 1 per cent of the total resources of Cali fornia State banks, have become members, the provisions of the Cali fornia bank act being unfavorable. Representatives of State banks of San Francisco, Los Angeles, and Oakland, having deposits aggre gating more than $500,000,000, have held conferences during 1917 and 1918 to consider the situation, and in May, 1918, the California Bankers Association referred to its legislative committee the matter of recommending amendments to the California bank act to enable California State banks to avail themselves of the advantage of Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

734 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. Federal Reserve membership, which is fundamentally an increase of power to render service and incidentally a corresponding increase in profits. Such proposed amendments will be considered by the legis lature convening in January, 1919. Schedule 11 gives by States a comparative statement of the num ber, capital, and resources of State member banks on November 1, 1918, as compared with all State banks in the district. RELATIONS WITH NATIONAL BANK MEMBERS. DISCOUNT OPERATIONS. The major portion of the discounts of the Federal Reserve Bank have naturally been for national-bank members. Three hundred and fifty-seven national banks out of a total of 554 have discounted with the Federal Reserve Bank during the year, as compared with 156 out of a total of 530 during 1917. Discounts for national banks totaled approximately $887,400,000 during 1918. FIDUCIARY POWERS. During 1918 permission was granted to seven banks to exercise fidu ciary powers. Subsequent to the amendment of the Federal Reserve Act, broadening the fiduciary powers to be exercised by national banks, 15, as follows, have applied to the Federal Reserve Board for the required permission: Capital Surplus Resources State. Number. of applying of applying of applying banks. banks. banks. California 7 $10,650,000 $8,000,000 $125,753,000 1 50,000 22,500 582,000 7 4,175,000 1,205,500 60,572,000 Total 15 14,875,000 9,228,000 186,907,000 PERMISSION TO ACCEPT TO 100 PER CENT OF CAPITAL AND SURPLUS. Four banks in Seattle and three in Spokane were granted permis sion to accept drafts and bills of exchange up to 100 per cent of capital and surplus during 1918. Such powers were required pri marily for the purpose of assisting the United States Grain Corpora tion in its transactions in the Pacific Northwest. A list of banks having authority to accept to 100 per cent is given in vSchedule 12. RELATION WITH STATE BANKS AND TRUST COMPANIES 0 DISCOUNT OPERATIONS. State bank members during the first 11 months of 1918 discounted with the Federal Reserve Bank $54,037,000, of which $14,836,000 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 12—SAN FRANCISCO. 735 represented rediscounts and $39,201,000 collateral notes secured by Government obligations. During the same period nonmember State banks availed themselves of the privilege of borrowing through member banks on their collateral notes secured by Government obligations to the extent of $4,230,092.94. EXAMINATIONS. The Federal Reserve Bank, in accordance with agreements with the clearing-house associations, has conducted the clearing-house exami nations in the four branch cities (Spokane, Seattle, Portland, Salt, Lake City), and has also examined five State-bank members during the year and 29 State banks applying for membership. State banking departments have shown for the most part a spirit of cordial cooperation. Examinations have been made in California, Idaho, Utah, and Washington jointly with State banking depart ments, and copies of reports of examinations by State banking departments have been furnished. For further cooperation, arrange ments are now being made for State-bank members to authorize the interchange of examiner's reports, reports of condition, etc., be tween State authorities and the Federal Reserve Bank. In addition, there has been considerable discussion with a view to establishing uniformity of forms of the several State banking departments and those of the Federal Reserve Board. Such uniformity would not only simplify but would add materially to the value of statistical tabulations. The Federal Reserve Bank has created a department of examina tions, appointing as manager Mr. S. G. Sargent, former superinten dent of banks in the State of Oregon. While it may cease conduct ing the clearing-house examinations in the four branch cities, it is expected that the examinations made will be of increasing effective ness and value. RESERVES. State member banks' required reserve dep6sits with the Federal Reserve Bank on November 1 amounted to $6,539,000, being 8.7 per cent of the total member banks' reserve accounts on that date. As a general rule the required reserves have been maintained. FISCAL AGENCY OPERATIONS FOR TREASURY DEPARTMENT. ALLOTMENT OF TREASURY CERTIFICATES AMONG BANKS OF THE DISTRICT. The financing of Liberty loan subscriptions and tax payments by purchase of Treasury certificates of indebtedness has been of great value in avoiding the strain that would otherwise have been felt throughout the district from the withdrawal at one time of the Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

736 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. large sums involved. In the earlier issues the quota for this district was not reached, but later the oversubscription was enough to over come the earlier deficiency. Mr. E. W. Wilson, vice president of the Anglo and London Paris National Bank, San Francisco, has acted as director of sales. Schedules 13 to 15 show in detail the amount of these certificates subscribed through the Federal Reserve Bank for each of the issues during 1918. DEPOSITS OF TREASURY FUNDS WITH BANKS AND THEIR WITHDRAWAL. Of the 1,866 banks in this district, 433 have qualified as Govern ment depositaries for war loan deposit accounts, making payment by credit on their books for their subscriptions to Treasury certificates and Liberty loans, the deposits being gradually withdrawn as needed by the Government. Out of total subscriptions of $287,975,000 to the third Liberty loan, payments by credit, aggregating $105,950,000, were made by 326 qualified depositaries. Out of the $305,020,000 of Treasury certificates of indebtedness sold in this district in anticipation of the fourth Liberty loan, payment for $191,685,000 was made in this manner. Fifty-four banks purchasing Treasury certificates in anticipation of income and excess profit taxes qualified for and received redeposits aggregating approximately $39,000,000. FLOTATION OF LIBERTY LOANS. The general plan of organization followed during the Liberty loans in 1917 was continued for the third and fourth loans in 1918. The district quota for the third Liberty loan was $210,000,000. Sub scriptions received totaled $287,975,000, every State, county, and city exceeding its quota. Similarly the quotas for the fourth Liberty loan were exceeded in every State, county, and city, the quota for the district being $402,000,000, and final subscriptions $462,250,000. Distribution of Liberty loan purchases by States and principal cities, methods of payment for bonds taken, etc., are shown in Schedules 16 to 21. WORK IN CONNECTION WITH WTAR-SAVINGS CERTIFICATES. The Federal Reserve Bank has acted as agent of the Government in selling war-savings stamps and certificates to banks and trust companies in the district and to individuals who qualified as collateral agents by the deposit of Liberty bonds as security against the with drawal of stamps. Prior to September, the campaign was handled by the National War Savings Committee in Washington, which appointed State directors who reported directly to Washington. In September this committee retired and the governor of the Federal Reserve Bank was placed in charge of the war-savings campaign fin Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTBICT NO. 12—SAK FRANCISCO, 737 this district. The same directors and their organizations were retained. A statement of sales of thrift stamps and war-savings certificates through the Federal Reserve Bank is given in Schedule 22. WAR FINANCE CORPORATION. In this district only five applications for loans from the War Finance Corporation were received, one of these for $10,000 being approved. CAPITAL ISSUES COMMITTEE. The Capital Issues Committee, created by act of Congress, approved April 5, 1918, took office on May 17, succeeding an informal committee constituted by the Federal Reserve Board in January. The present district committee was appointed by the Capital Issues Committee late in May and entered upon its duties as the successor to a subcom mittee which had been serving in the district under the informal committee. The district committee terminated its work on Decem ber 31, 1918. The district committee was composed of 26 members, four in Los Angeles, two each in Portland and Seattle, and one each in Tacoma, Spokane, Boise, Salt Lake City, Elko (N"ev.), and Phoenix (Ariz,). In San Francisco there were 13 committeemen, six of whom, together with one of the Los Angeles members, constitute the execu tive committee of seven, which has met on Friday morning of each week. The chairman of the board and the governor of the Federal Reserve Bank were respectively the chairman and vice chairman of the district committee and of the executive committee. The committee men investigated the applications referred to them, reporting with recommendations to the executive committee. The detail work of digesting information for presentation at executive committee meet ings, and of conducting the correspondence, was performed by a force consisting of the secretary, assistant secretary, a stenographer-clerk, and three stenographers. All of the committeemen served with out pay. During 1918 the district committee and its predecessor together considered a total of 543 applications for approval of security issues amounting to $386,145,257, of which 384 applications, amounting to $194,015,197, were approved, and 137 applications, amounting to $163,155,490, were disapproved. The remainder, or 22 applications, amounting to $28,974,570, were reported to the Capital Issues Com mittee, Washington, without recommendation. In addition, 30 applications for approval of issues, amounting to $24,000,000, arising in the district, were acted upon directly by the Capital Issues Com mittee without reference to the district committee. Of the total con sidered, 185 applications, amounting to $91,322,823, represented public issues; that is to say, the issues of States or subdivisions thereof, Digitized for FRASER 100823°—19 47 http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

738 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. and 358 applications, amounting to $294,822,434, represented issues of private corporations or individuals. In addition to the business transacted at its meetings, the effectiveness of the committee is further illustrated by the fact that 61 projects, the issues of which would have amounted to $75,000,000, were discouraged at their inception as nonessential. Schedule 23 gives an analysis of the business transacted by the committee. NOTE ISSUES. FEDERAL RESERVE NOTES. The substitution of paper for gold as the ordinary currency of this district has been greatly accelerated during the past year. For almost three years after the establishment of the Federal Reserve Bank small need developed for the use of Federal Reserve notes, the amount outstanding on April 6, 1917, being only $15,398,695. Dur ing the latter part of 1917 the need for a greater volume appeared, the amount in the hands of the public on December 31, 1917, being $67,744,305. Especially during 1918 the need for increasing the gold reserve of the Federal Reserve Bank led to substitution of Federal Reserve notes for gold as the principal circulating medium with the result that, in this district, where gold has been the tradi tional currency, paper money now circulates almost exclusively, the amount of Federal Reserve notes of this bank in circulation on Decem ber 31, 1918, being $212,243,000. The gold has been mobilized in the Federal Reserve Bank. Many banks and treasurers of public funds have cooperated in building up the gold reserve of the Federal Reserve Bank by exchanging gold for Federal Reserve notes. It has been through such aid that the Federal Reserve Bank has been able to maintain so strong a position in the face of the large calls made upon it for assistance. From April 9, 1918, to December 27 the following shipments of gold were received by the Federal* Reserve Bank from throughout this district: Source. Amount. $25,688,655 State banks 26,682,985 State, city, and county treasurers - - - 3,391,645 Total 55,763,285 Number of shipments 4,367 In all States except California the response of State banks to the request to exchange gold for Federal Reserve notes was as prompt as that of national banks. In California the bank act provided that a certain proportion of the reserves must be carried in gold coin, gold certificates, or United States notes, and as Federal Reserve notes Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 12 SAN FRANCISCO. 739 were not construed by the State banking department as United States notes, State banks did not feel free to release any of their gold except that held in excess of reserve requirements, their gold holdings decreasing only $7,000,000 between June 29 and August 31, from $26,640,000 to $19,623,000. Because of this, on August 28, the Superintendent of Banks wrote to the Chairman of the Board of the Federal Reserve Bank, stating that, under the discretion vested in him by the bank act, he would waive the right to impose penalties upon State banks which held their reserves on. hand in Federal Reserve notes. The publication of this communication resulted in considerable shipments to the Federal Reserve Bank, the gold hold ings of California State banks decreasing to $12,245,000 on November 1. Between April 9 and December 21, California State banks have shipped $22,752,000 in gold and gold certificates to the Federal Reserve Bank. If proposed amendments to the California bank act are approved, it is to be expected that California State banks will release further amounts of gold. That the major portion of the increase in Federal Reserve note circulation during 1918 resulted from issues in exchange for gold is strikingly illustrated by the fact that on January 1 Federal Reserve notes in the hands of the public were $67,744,305 and net deposits $69,922,002, amounting together to $137,666,307, gold reserve amounting to $94,018,470, or 68.69 per-cent, while on December 1 Federal Reserve notes in circulation had increased to $201,404,000 and net deposits to $76,102,000, the gold reserve increasing to $172,- 217,000, or 62.59 per cent, a decrease of 6.10 per cent, while on December 31 the net circulation of Federal Reserve notes amounted to $212,243,000; net deposits, $50,696,000; and combined gold reserve, $150,973,000, or 57.41 per cent. A statement of Federal Reserve notes issued and redeemed during the year is contained in Schedule 24. FEDERAL RESERVE BANK NOTES. As provided by the Pittman Act, the Federal Reserve Board is requiring Federal Reserve Banks to issue Federal Reserve bank notes to take the place of $350,000,000 standard silver dollars now being melted to ship to the Orient as bullion, the allotment of the Federal Reserve Bank of San Francisco being approximately 6f per cent of the entire issue. The first shipment of $5 Federal Reserve bank notes was received on June 10, of $1 notes on October 9, and of $2 notes on October 28. Those received are being gradually put into circulation, the total outstanding on December 31 being $6,253,000. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

740 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. POSITION OF COMMERCIAL BANKS AS A RESULT OF WAR FINANCING. INCREASE OF THEIR OBLIGATIONS. With expansion of business and increase of prices, resources of the national banks of the district have increased from $1,065,191,000, on March 5, 1917, the date of the last report made by them prior to the entrance of the United States into the war, to $1,360,534,000 on November 1, 1918. During this period capital increased from $89,880,000 to $93,689,000 and surplus and profits from $61,804,000 to $70,467,000; deposits due to other banks decreased from $198,- 060,000 to $172,061,000; demand deposits increased from $485,149,000 to $679,494,000; time deposits from $160,421,000 to $184,282,000; rediscounts from less than $500,000 to $38,517,000; money borrowed from $704,000 to $57,780,000, practically all secured by Govern ment obligations; and loans and discounts from $559,469,000 to $691,176,000. EFFECT ON COMMERCIAL PAPER OF DISTRICT. Production on Government contracts has had a tendency to lessen the offerings of so-called commercial paper (that sold through brokers), many concerns which hitherto financed themselves in this maimer looking to the Government for funds. On the other hand, the decreasing purchasing power of the dollar has increased the credit needs of many concerns with the result that the volume of paper offered in this district has not appreciably changed. Rates on commercial paper have remained stable and all offerings have been readily absorbed. RELATION TO AND EFFECT UPON GENERAL BUSINESS. The most salutary effect of the war upon the credit situation in this district has been the curtailment of credit periods, many con cerns which formerly sold goods upon a basis of 90 days to 6 months now requiring payment within 30 days. This condition has made for curtailment of inflation. POLICY TO BE PURSUED IN RESTORING LIQUIDITY OF BANKS. PROBABLE TIME IN WHICH THEY CAN CLEAR UP THEIR WAR PAPER. As the products of this district are primarily agricultural, the sale for which has been certain, and as there has been some tendency to shorten the time of commercial credit and enforce prompt payment, part of the loans of the banks in this district will liquidate rapidly. Borrowing upon Government obligations has extended to consider able proportions, but these loans are being gradually liquidated. In proportion to their tot§l resources, investments by banks in Liberty Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 12—SAN FRANCISCO. 741 bonds are comparatively small, those of all national banks, through which practically half of the subscriptions were received, amounting to $56,854,000 on November 1, 1918, as compared with $1,360,534,000 total resources, $691,176,000 total loans and discounts, and $321,- 723,000 securities held. Liberty bonds held by national banks rep resent only 4.9 per cent of $1,154,345,850 of Liberty bonds sold in this district. The rate at which banks are liquidating their borrowings is shown by the reduction in rediscounts of commercial paper held by the Federal Reserve Bank from $49,289,000 on September 13 to $39,- 337,000 on November 8, to $30,038,000 on November 30, and $33,732,000 on December 31. This compares with $23,464,000 held on January 1, 1918. Similarly, borrowings on Government obliga tions are being reduced, member banks' collateral notes, practically all secured by Government obligations, held by the Federal Reserve Bank decreasing from $61,561,000 on October 10 to $44,136,000 on November 30 and $45,027,000 on December 31. If the next Liberty loan is not offered before April or May, it seems probable that the principal part of the Federal Reserve Bank's present loans based on Liberty bonds will be liquidated by that time. But meanwhile new loans will presumably appear based on the suc ceeding issues of certificates of indebtedness. It seems probable, therefore, that borrowings from the Federal Reserve Bank on paper secured by Government obligations will continue in substantial amount until after the next Liberty loan and that there will be steady liquidation of such paper thereafter. There seems reason to expect that they will be practically eliminated during the coming year. POLICY OF FEDERAL RESERVE BANK TOWARD THEM MEANWHILE. It is and has steadily been the policy of the Federal Reserve Bank to assist its member banks in meeting the special demands made upon them. This has been particularly true in -connection with unusual requirements for handling crops. Rarely has it been neces sary to criticise the attitude of a rediscounting bank. An occasional bank, however, has shown a deliberate determination to use Federal Reserve Bank funds for extending its business by taking on new loans much as if funds obtained by rediscount were new deposits. In such cases the desirable course is pointed out, with such insistence as the case seems to require. OPERATIONS OF FEDERAL RESERVE BANK BRANCHES. During 1917 branches were established at Spokane and Seattle, Wash., and Portland, Oreg., serving, respectively, the territory of east- TTT .i. • J._„ _ _. i j-i TJ.L. J. -nrr_ _i. • J_ _ „ _ _^ /^v Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

742 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. tory assigned to it being Utah, southern Idaho, and the eastern counties of Nevada, the territory served directly by the head office being California, Arizona, and western Nevada. The relative importance of the various branches may be judged from the following figures: Average monthly, 1918. Branch. Currency Transit items handled. Earnings, Total shipments excluding rediscounts. from head head office. Number. Amount. office expense. Portland $3,220,557 $1,974,160 66,996 $16,347,388 $9,239 Salt Lake City 18,003,304 1,093,000 157,943 26,846,295 45,599 Seattle 6,433,553 2,543,750 86,466 15,900,983 7,074 Spokane 6,989,709 707,500 96,350 14,695,134 24,423 Nov. 1, 1918. Branch. Number of mem Capital of Resources of ber banks. member banks. member banks. 97 $12,241,000 $204,603,000 Salt Lake City 112 3,425,000 41,516,000 Seattle 49 10,475,000 213,421,000 80 7,625,000 109,737,000 Total 338 33,766.000 5fiQ 277.onn INTERNAL ORGANIZATION. An increasing volume of transactions, largely necessitated by Government financing, rendered necessary an increase in staff from 313 on January 1 to 523, of whom 275 were women, on November 30. Sixty of the most experienced men have gone into the Army and Navy and in addition the epidemic of influenza has at times tempo rarily incapacitated more than 15 per cent of the clerical force. The bank has in no case claimed exemption from the draft for any of its employees. CLEARING-HOUSE SETTLEMENTS. Clearing-house balances in Los Angeles, Ogden, Portland, Salt Lake City, San Francisco, Seattle, Spokane, and Tacoma are now settled by transfers on the books of the Federal Reserve Bank, there by decreasing in a large measure the requirements for cash in vault on the part of the clearing-house banks in these cities. COLLECTIONS. Between January and November the daily average number of out-of-town checks handled increased from 14,836, for an amount averaging $2,206,441, to 29,783, for an amount averaging $6,554,231. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT ISO. 12—SAN FRANCISCO. 743 The increase in the number of the items between June, when the service charge of 1| cents per item was removed, and November, was 11,139. Similarly, there was a large increase in the number of notes, bills, and collection items handled after the removal of the service charge of 10 cents per item on June 5. In both cases it was the larger banks of the district which made increasing use of collection facilities. The smaller banks are gaining information as to the benefits of the Federal Reserve Bank collection system and it seems probable that during the next year they will take increasing advantage of the facilities offered. Out of a total of 1,310 State banks in the district all but 153 were remitting at par on November 30. GOLD-SETTLEMENT FUND. The system of leased wires installed early in June between all Federal Reserve Banks, their branches, and the Federal Reserve Board, has greatly increased the utility of the gold-settlement fund. As a result, daily settlements between Federal Reserve Banks were inaugurated in July, and on December 2 the branches of the Federal Reserve Bank which had previously been settling w^ith other Federal Reserve Banks through the head office began direct settlement through the gold-settlement fund. The Federal Reserve Bank now makes telegraphic transfers for member banks free of charge and in addition absorbs all charges for telegrams to and from it in connection with such transfers, with the result that member banks are making increasing use of Federal Reserve Bank telegraphic transfers. BANKING QUARTERS. The Federal Reserve Bank purchased as a site for the erection of a permanent home a plot of ground 119 feet 6 inches by 275 feet, bounded by Sansome, Commercial, Battery, and Sacramento Streets. War conditions, however, deferred construction, and a six-story loft building situated on one part of the ground was over hauled and fitted up to serve temporarily for the bank's use. This building is numbered 315 Battery Street, and on September 28 the executive and banking department and fiscal agent department were brought here. Vaults and tellers' cages are located on the first floor; telegraphic, stenographic, purchasing, and supply depart ments on the second; executive offices, discount department, and Federal Reserve agent's department upon the third; mail, statistical, and accounting departments upon the fourth; department of exam inations, filing, and auditing departments upon the fifth; and the accounting department of fiscal agent department upon the sixth floor. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

744 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. EXHIBIT A.—Movement of principal earning assets of the Federal Reserve Bank of San Francisco during the calendar year 1918. {On thousands of dollars, i. e., 000 omitted.] Discount b e w s y d S e a c U t r p a u a o n t r p b e e i s t l e d i e r d dis p O c a o t p h u e e n r r t . ed (1+2) i m b n o B a o u r i p l k g l e e s h n t t . d T i b s o o c t a o a u n l u g d b n h i t t l e l d s ] Pe d r + c 5 e ) n t. e a a T s r s o n e t i a t n s l g . gations. 1 Jan. 4.... 2,674 21,796 24,470 15,416 39,886 6.7 43,845 Jan. 11... 2,161 19,978 22,139 16,817 38,956 5.5 42,961 Jan. 18... 2,500 23,326 25,826 17,386 43,212 5.8 47,223 Jan. 25... 3,356 25,996 29,352 18,968 48,320 6.9 52,341 Feb. 1... 4,408 25,639 30,047 24,504 54,551 8.1 58,594 Feb. 8... 3,599 25,653 29,252 29,621 58,873 6.1 62,965 Feb. 15.. 3,328 26,474 29,802 30,479 60,281 5.5 64,514 Feb. 21. . 5,790 24,599 30,389 30,122 60,511 9.6 64,799 Mar. 1... 7,590 24,946 32,536 30,353 62,889 12.1 67,183 Mar. 8... 8,014 26,339 34,353 30,956 65,309 12.3 70,031 Mar. 15.. 6,554 25,110 31,664 29,919 61,583 10.6 66,152 Mar. 22.. 6,844 23,700 30,544 29,471 60,015 11.4 64,523 Mar. 29.. 5,981 22,874 28,855 27,473 56,328 10.6 60,874 Apr. 5... 5,965 23,831 29,796 26,392 56,188 10.6 60,669 Apr. 12.. 7,861 23,592 31,453 24,923 56,376 13.9 63,781 Apr. 19.. 8,742 23,022 31,764 23,658 55,422 15.8 62,849 Apr. 26.. 11,235 23,764 34,999 21,490 56,489 19.9 61,004 May 3... 10,829 25,755 36,584 21,495 58,079 18.6 62,661 May 10.. 10,274 27,516 37,790 18,849 56,639 18.1 60,855 May 17.. 10,164 27,959 38,123 20,188 58,311 17.4 64,038 May 24.. 11,059 28,835 39,894 20,669 60,563 18.3 65,591 May 31.. 12,803 29,094 41,897 19,964 61,861 20.7 67,090 June 7... 11,059 28,707 39,766 19,287 59,053 18.7 64,301 June 14. - 13,928 26,572 40,500 19,874 60,374 23.1 65,685 June 21.- 9,956 27,189 37,145 18,102 55,247 18.0 60,503 June 28.. 12,665 29,175 41,840 16,006 57,846 21.9 62,840 July 5... 16,332 34,158 50,490 15,942 66,432 24.6 71,426 July 12.. 13,432 35,671 49,103 17,692 66,795 20.1 71,287 July 19.. 13,969 39,379 53,348 19,162 72,510 19.3 76,975 July 26.. 19,537 46,289 65,826 18,541 84,367 23.2 88,832 Aug. 2... 23,059 46,900 69,959 18,851 88,810 26.0 93,398 Aug. 9.. - 30,114 47,352 77,466 21,203 98,669 30.5 103,528 Aug. 16.. 29,817 48,274 78,091 19,847 97,938 30.4 102,797 Aug. 23.. 29,295 46,430 75,725 21,117 96,842 30.3 101,303 Aug. 30.. 32,326 44,230 76,556 19,312 95,868 33.7 100,349 Sept. 6... 40,877 45,654 86,531 19,915 106,446 38.4 110,918 Sept. 13.. 41,251 47,375 88,626 20,469 109,095 37.8 113,570 Sept. 20.. 45,728 46,439 92,167 20,364 112,531 40.6 117,018 Sept. 27.. 51,042 45,664 96,706 22,451 119,157 42.8 123,811 Oct. 4... 61,155 41,746 102,901 23,898 126,799 48.2 131,557 Oct. 10.. 64,470 40,594 105,064 27,784 132,848 48.5 137,666 Oct. 18.. 62,711 41,075 103,786 32,843 136,629 45.9 141,522 Oct. 25.. 52,035 38,987 91,022 38,852 129,874 40.1 153,637 Nov. 1... 55,527 37,858 93,385 34,656 128,041 43.4 134,436 Nov. 8... 47,506 37,537 85,043 34,299 119,342 39.8 125,723 Nov. 15.. 51,362 33,175 84,537 34,175 118,712 43.3 125,194 Nov. 22.. 40,518 30,210 70,728 35,045 105,773 38.3 112,222 Nov. 29.. 43,748 28,776 72,524 34,303 106,827 41.0 113,291 Dec. 6... 52,075 30,185 82,260 43,702 125,962 41.3 133,011 Dec. 13.. 58,143 29,927 88,070 44,114 132,184 44.0 139,631 Dec. 20.. 47,838 26,911 74,749 43,942 118,691 40.3 134,181 Dec. 27.. 52,136 28,039 80,175 38,489 118,664 43.9 126,851 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTEICT NO. 12—SAN FBANCISCO. 745 FEDERAL RESERVE BANK OF SAN FRANCISCO. MOVEMENT OF EARNING ASSETS DURING THE CALENDARJ'EAR 1918 Chrfel.-flfSrXban.Sitfuei'.^ (MrreZ.-JotalStils&iscoujazd, I Gu-pe3.jBius S)iscounted.artiJ8oa^hC, I i Curre4:j5t&te&/uit£-tTsse6SjihoZ. U.S. GovertunaUrSoourities Gave S.McUio ofTtfajGbautJhner i to Total 3UlsViscotmted andJBocujht Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

746 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. EXHIBIT B.—Movement of cash reserves, net deposits, Federal Reserve note liabilities, and the reserve percentage of the Federal Reserve Bank of San Francisco during the calendar year 1918. [In thousands of dollars; i. e., 000 omitted.] Federal Reserve Total cash Net notes in (2+3) reserves. deposits. actual circula tion. Jan. 4... 98,044 69,138 68,723 137,861 Jan. 11.. 105,330 75,338 68,787 144,125 Jan.18.. 106,228 81,030 68,225 149,255 Jan.25.. 101,704 82,306 67,481 249,787 Feb.l... 90,398 77,302 67,417 144,719 Feb. 8... 87,246 75,876 70,087 145,963 Feb. 15.. 85,501 75,272 70,678 145,950 Feb. 21.. 91,671 80,629 71,879 152,508 Mar. 1... 90,535 79,599 74,045 153,644 Mar. 8... 89,742 79,121 76,715 155,836 Mar. 15.. 91,881 77,120 77,579 154,699 Mar.22.. 101,430 81,455 80,285 161,740 Mar. 29.. 100,207 77,221 80,836 158,057 Apr. 5... 107,029 79,625 83,566 163,191 Apr. 12.. 106,341 78,304 87,323 165,627 Apr. 19.. 112,091 79,607 90,822 170,429 Apr. 26.. 113,863 77,285 92,987 170,272 May 3... 120,488 76,820 101,833 178,653 May 10.. 130,274 80,558 106,024 186,582 May 17.. 124,119 75,962 107,541 183,503 May 24.. 126,460 78,193 109,210 187,403 May 31.. 128,554 79,969 110,957 190,926 June 7... 137,462 82,296 114,789 197,085 June 14.. 137,313 81,199 117,123 198,322 June 21.. 136,640 71,419 121,012 192,431 June 28.. 131,372 64,033 125,287 189,320 July 5... 120,955 56,115 131,443 187,558 July 12.. 137,590 71,087 132,610 203,697 July 19.. 135,850 74,053 133,175 207,228 July 26.. 132,438 81,949 133,945 215,894 Aug. 2... 124,550 74,400 137,699 212,099 Aug. 9... 114,479 72,841 139,203 212,044 Aug. 16.. 121,459 73,578 144,678 218,256 Aug. 23.. 137,001 82,899 149,218 232,117 Aug. 30.. 128,092 67,252 154,666 221,918 Sept. 6.. 137,357 76,313 165,414 241,727 Sept. 13. 144,662 81,289 170,738 252,027 Sept. 20. 147,063 81,309 175,813 257,122 Sept. 27. 143,376 79,586 180,381 259,967 Oct. 4... 136,063 74,225 186,112 260,337 Oct. 10.. 142,.805 87,222 185,961 273,183 Oct. 18.. 129,994 76,013 188,161 264,174 Oct. 25.. 126,341 85,103 187,706 272,809 Nov. 1.. 128,777 64,929 190,954 255,883 Nov. 8.. 151,207 74,579 193,748 268,327 Nov. 15. 154,240 74,192 196,210 270,402 Nov. 22. 172,247 77,921 197,397 275,318 Nov. 29. 170,619 73,247 201,209 274,456 Dec. 6... 170,179 87,439 206,071 293,510 Dec. 13.. 155,602 72,842 211,900 284,742 Dec. 20.. 159,642 70,912 212,444 283,356 Dec. 27.. 160,378 63,339 211,692 275,031 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 12—SAN FKANCISCO. 74? & FEDERAL RESERVE BANK OF SAN FRANCISCO. s? DEPOSIT AND NOTE LIABILITIES, ALSO CASH RESERVES, DURING THE CALENDAR YEAR 1918. Qxrve!:MtZterLQSLts. Gxrv&2: JotaL CasTufteserves\ ~ * " ' 7fet0eftosit<vulJrJUVc'-~ ^~ r-''-^ 1 of Casfv-fiescrves 6oJfq<. regate Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

748 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. SCHEDULE 1.—Comparative statement. Dec. 31, 1918. Dec. 31,1917. Apr. 6, 1917. RESOURCES. Total gold reserve $150,972,012 $94,018,470 $41,030,130 Legal tender notes 518,639 408,823 65,105 Total reserves 151,490,651 94,427,293 41,095,235 Bills discounted, members 33,734,845 23,463,513 340,372 Member banks, collateral notes 45,024,583 2,316,688 Bills bought in open market 36,279,727 17,082,456 6,882,369 Total bills on hand 115,039,155 42,862,657 7,222,741 United States Government, long-term securities 2,460,950 2,455,000 2,428,. 750 United States Government, short-term securities 5,724,000 1,500,000 4,030,000 Municipal warrants 811,145 Total earning assets 123,224,105 46,817,657 14,462,636 Due from other Federal Reserve Banks, net 5,908,934 1,008,437 Uncollected items 44,671,524 12,809,375 7,763,756 Total deductions from gross deposits 44,671,524 18,718,309 8,772,193 Five per cent redemption fund against Federal Reserve bank notes 356,400 All other resources 1,701,065 583,807 Total resources 321,443,745 160,547,066 64,330,064 LIABILITIES. Capital paid in 4,636,550 4,162,450 3,941,000 Surplus 1,224,088 Government deposits 410,992 12,353,939 3,730,741 Due members' reserve account 73,235,715 63,779,910 38,497,162 Other deposits, including foreign Government credits 2,643,648 2,620,985 Collection items " " 19,076,038 9,885,477 2,654,776 Total gross deposits 95,366,393 88,640,311 44,882,679 Federal Reserve bank notes, net outstanding 6,252,055 Federal Roserve notes in actual circulation 212,244,625 67,744,305 15,398,695 All other liabilities 1,720,034 107,690 321,443,745 160,547,066 64,330,064 SCHEDULE 2.—Earnings, expenses. and dividends. 1918 1917 EARNINGS. Bills discounted for members $2,675,550.83 $292,981.91 Acceptances bought 1,097,629.87 308,595.60 United States securities 135,268.29 147,355.24 Municipal warrants 11,934.70 Profits realized on United States securities 293.75 11,250.00 Penalties for deficient reserves 96,409.28 18,221.97 Transfers bought and sold, net 127,387.68 64,363.55 Service charges, net 19,861.84 31,047.40 Sundry profits 35,383.35 52.08 Total 4,187,784.89 885,802.45 EXPENSE. Current expense 682,550.25 267,541.28 Cost of Federal Reserve notes and Federal Reserve bank notes 248,424.10 43,074.97 Furniture and fixtures 45,168.48 28,142.34 Purchase of gold 94,426.73 Depreciation on bank premises 238,600.35 Sundry items charged to profits and loss 9,450.84 Total 1,318,620.75 338,758.59 Net earnings 2,869,164.14 547,043.86 Balance profit and loss Dec. 31, 1918 $76,685.37 Net earnings 2,869 j 164.14 Total 2,945,849.51 June 30,1918, dividend No. '5 $362,197.80 Dec. 31,1918, dividend No. 6 135,476.60 497,674.40 Undivided profits 2,448,175.11 The two dividends paid during the year are the accrued dividends covering the period from Jan. 1,1917, Digitized fotor FDRecA. S31E, 1R9 18, inclusive. http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTEICT NO. 12—SAN FEANCISCO. 749 SCHEDULE 3.—Estimated value of all crops in Twelfth Federal Reserve District. [000 omitted.] 1910-1914, States. 5-year 1915 1916 1917 1918 average. Arizona $9,842 $10,262 $18,626 $27,068 $42,267 California 203,368 204,747 271,668 432,285 365,028 Idaho 43,319 48,735 75,136 94,890 107,111 Nevada 13,523 12,988 17,148 25,655 24,536 61,851 70,679 105,471 108,632 122,481 Utah 23,614 26,865 43,436 49,627 54,759 "Washington 87,472 93,634 128,950 144,422 135,255 Total 422,989 467,910 660,435 822,579 851,427 SCHEDULE 4.—Production of principal cereal and vegetable crops in Twelfth Federal Re serve District, by States. [000 omitted.] States. Year. Wheat. Barley. Oats. Hay. Potatoes. Bushels. Bushels. Bushels. Tons. Bushels. Arizona 1914 868 1,260 336 454 110 1915 1,092 1,295 333 470 95 1916 1,160 1,120 338 627 115 1917 825 1,155 400 550 420 1918 988 1,326 440 493 425 1914 6,800 42,060 7,700 5,265 10,350 1915 7,040 39,440 6,963 4,230 10,140 1916 5,600 33,320 6,500 4,375 10,575 1917 7,425 39,150 6,860 4,560 15,225 1918 7,590 34,320 5,600 3,143 12,870 Idaho 1914 14,362 7,030 14,608 1,868 5,270 1915 18,730 7,736 15,745 1,828 3,500 1916 15,071 7,410 13,330 1,750 4,050 1917 13,830 5,510 10,450 2,175 6,084 1918 18,043 4,900 9,480 2,058 5,220 1914 1,332 611 676 803 1,560 1915 1,660 576 585 675 2,236 1916 1,592 492 602 540 2,660 1917 1,140 420 560 679 3,105 1918 1,070 408 532 647 1,539 1914 16,604 3,660 12,740 1 716 4 753 1915 20,025 4,680 16,060 1,870 5,520 1916 19,550 5,390 17,280 1,955 8,250 1917 12,811 5,278 9,125 1,638 8,100 1918 19,000 3,180 9,000 1,220 8,000 Utah 1914 7,275 1,440 4,750 1,116 2,800 1915 8,225 1,445 4,700 985 2,500 1916 6,900 1,224 4,480 845 3,600 1917 5,650 1,221 4,400 1,137 4,347 1918 6,464 1,120 4,410 1,126 3,600 1914 41,840 7,098 13,959 1,751 7,552 1915 51,420 7,263 13,750 1,868 8,235 1916 37,635 6,814 14.300 1,920 9,900 1917 29,218 4,930 11,242 1,778 9,875 1918 26,429 2,630 8,370 1,429 8,560 Total 1914 89,081 63,159 54,769 12,973 32,395 1915 108,192 62,435 58,136 11,926 32,226 1916 87,508 55,770 56,830 12,012 39,150 1917 70,899 57,664 43,037 12,517 47,156 1918 79,584 47,884 37,832 10,116 40,214 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

750 ANNUAL KEPOKT OF THE FEDERAL RESERVE BOARD. SCHEDULE 4.—Production of 'principal cereal and vegetable crops, etc.—Continued. [000 omitted.] States. Year. Cotton. Rice. Beans. b S e u e g ts ar .1 Bales. Bushels. Bushels. Tons. Arizona 1914 1915 1916 48 1917 24 152 1918 51 72 1914* 50 800 3,875 1,082 1915 29 2,268 3,868 1,249 1916 44 3,422 5,576 1,463 1917 67 5,600 8,091 1,318 1918 100 7,011 8,800 1,102 1914 264 1915 340 1916 331 1917 330 1918 " 347 Utah 1914 565 1915 629 1916 708 1917 776 1918 1,094 Total 1914 50 800 3,875 1,911 1915 29 2,268 3,868 2,218 1916 44 3,422 5,624 2,502 1917 91 5,600 8,243 2,424 1918 151 7,011 8,872 2,543 1 Arizona, ITevada, Oregon, and Washington not separately reported. SCHEDULE 5.—Carload shipments of deciduous fruits out of California. Year. 1911 1912 1913 1916 1917 1918 216 244 231 164 295 351 214 196 158 289 403 441 Peaches 2,027 1,621 2,359 1,909 2,432 3,137 Plums 1,366 1,776 1,706 1,999 2,651 2,483 Pears 2,325 3,134 2,496 3,701 4,798 4,569 Grapes 6,375 6,358 6,364 9,722 13,739 16,359 16 15 18 107 65 77 Total 12,539 13,344 13,332 17,891 24,383 27,417 SCHEDULE 6.—Bank clearings of the principal cities in the Twelfth Federal Reserve District. [000,000 omitted.] Cities. 1911 1912 1913 1914 1915 1916 1917 1918. Bakersfield- .. (l) $22 $24 $24 $20 $28 $36 $43 Fresno $40 51 57 53 54 72 109 124 Los Angeles (2) 1,169 1,211 1,14 1 5 7 1,04 2 8 6 1,28 3 4 0 1,50 3 2 8 1,54 5 7 2 943 223 189 176 181 223 269 335 Pasadena 173 47 48 44 44 50 58 50 Sacramento 42 93 108 103 101 126 164 203 San Diego 78 132 134 103 100 112 121 106 San Francisco 83 2,678 2,624 2,516 2,694 3,480 4,838 5,629 San Jose 2,427 36 36 36 35 44 54 55 Stockton 30 45 46 47 50 72 93 99 Reno 40 15 15 14 15 21 30 31 Portland 557 596 628 577 554 650 868 1,323 Salt Lake City 369 333 315 350 513 710 697 Ogden 61 100- 100 Seattle 553 602 665 628 612 790 1,151 1,860 Spokane 225 219 203 193 255 344 422 Tacoma 139 133 110 99 115 162 244 Total 4,966 6,442 6,470 6,111 6,176 7,926 10,647 12,880 Digitized for FRASER i Organized 1912. a Organized 1914. http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

751 DISTRICT WO. 13—SAN FRANCISCO. •SCHEDULE 7.—Building permits of principal cities in Tvjelfth Federal Reserve District. [000 omitted.] First 11 1916 months, 1918. Bakersfleld 134 235 586 296 Fresno 1,201 876 2,079 1,795 Long Beach 1,368 1,058 1,033 2,722 Los Angeles 11,885 15,035 16,934 7,966 Oakland 5,044 5,367 4,442 5,100 Pasadena 1,494 1,619 1,369 425 Sacramento1... 1,392 2,111 1,895 1,069 San Diego 1,284 1,878 904 1,517 San Francisco.. 18,624 18,825 18,172 8,576 SanJose 536 716 490 512 Stockton 1,018 1,169 1,353 1,022 Reno 446 221 463 59 Portland 5,189 6,299 3,642 5,861 Salt Lake City.. 2,250 2,868 2,733 1,782 Ogden2 862 1,407 245 Seattle 6,471 8,480 6,713 10,613 Spokane 1,291 1,574 2,140 410 Tacoma 790 1,619 1,144 2,718 Total. 60,417 70,812 67,499 52,688 i No records given for August, 1918. 2 Records incomplete. SCHEDULE 8—Exports and imports in Twelfth Federal Reserve District. [000 omitted.] Exports. Imports. 1916 1917 1918. 1916 1917 1918. San Francisco district $126,758 $175,136 $214,729 $117,128 $231,979 $245,520 Los Angeles district 4,439 7,179 6,781 5,463 8,063 9,417 State of Oregon 4,019 6,416 15,076 2,435 2,439 3,799 State of Washington 200,448 196,932 296,196 161,780 289,078 300,954 Total 335,664 385,663 532,782 286,806 531,559 559 690 SCHEDULE 9.—Movement of national bank membership during 1918. Organizations. Conversions. Liquidations. Dec. 31,1918. States. Num Num Num Num ber of Capital. ber of Capital. ber of Capital. ber of Capital. banks. banks. banks. banks. Arizona 1 $50,000 2 $150,000 10 $925,000 6 223,000 7 390,000 5 $705,000 276 61,333,000 Idaho 2 , 175,000 3 75,000 68 4,030,000 Nevada 10 1,435,000 Oregon 2 75,000 1 25,000 84 10,226,000 Utah 2 50,000 25 3,430,000 Washington 1 25,000 2 240,000 81 12,285,000 Total 14 598,000 15 880,000 5 705,000 554 93,664,000 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

752 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. SCHEDULE 10.—State bank members of Federal Reserve Bank. Order of ad City. Bank. mis Capital. Surplus. Resources. sion. ARIZONA. Phoenix The Valley Bank. 41 $500,000 $100,000 $4,216,000 CALIFORNIA. Placerville A. Mierson Banking Co 60,000 56,000 932,000 San Fernando. San Fernando Valley Savings Bank. 25,000 3,000 123,000 Santa Monica.. Bank of Santa Monica 110,000 51,000 1,526,000 Stockton Farmers & Merchants Bank 640,000 210,000 5,497,000 Total. 825,000 320,000 8,078,000 ID AliO. Ashton Security State Bank 25,000 20,000 473,000 Blackfoot Blackfoot City Bank 50,000 10,000 594,000 Cambridge.. Peoples Bank 40,000 2,000 346,000 Emmett Bank of Emmett 60,000 10,000 540,000 Filer .. Farmers & Merchants Bank 25,000 121,000 Genesee Genesee Exchange Bank 25,000 13,000 549,000 Gooding Citizens State Bank 25,000 10,000 328,000 Idaho Falls... A nderson Bros. Bank 100,000 100,000 2,075,000 Idaho Falls... Farmers & Merchants Bank 150,000 8,000 1,315,000 Kimberly Bank of Kimberly 35,000 11,000 382,000 May Union Central Bank 30,000 1,000 81,000 Menan Jefferson State Bank , 25,000 •0} 0) Meridan Meridan State Bank 25,000 111,000 Murtaugh Bank of Murtaugh 25,000 81,000 Nez Perce.... Union State Bank 50,000 10,000 307,000 Orofino Bank of Orofino 25,000 - 4,000 273,000 Parma Parma State Bank 100,000 25,000 652,000 Picabo Picabo State Bank 25,000 80,000 Potlatch Potlatch State Bank 50,000 10,000 774,000 Rexburg Farmers & Merchants Bank 50,000 6,000 372,000 Rigby Rigby State Bank. 30,000 8,000 320,000 St. Anthony.. St. Anthony Bank & Trust Co.. 30,000 14,000 551,000 Star Farmers Bank 25,000 5,000 214,000 Sugar City— Fremont County Bank 25,000 2,000 233,000 Sweet Farmers & Stockgrowers Bank. 25,000 150,000 Victor Victor State Bank 25,000 196,000 Total. 1,100,000 269,000 11,118,000 OREGON. Astoria Scandinavian-American Bank.. 100,000 10,000 1,545,000 Enterprise Enterprise State Bank 50,000 10,000 286,000 Hood River Butler Banking Co 100,000 20,000 1,051,000 Joseph First Bank of Joseph 50,000 10,000 325,000 Marshneld Bank of Southwestern Oregon.. 100,000 10,000 950,000 Do Scandinavian-American Bank.. 25,000 5,000 258,000 Moro. Farmers State Bank 25,000 1,000 309,000 North Portland.. Livestock State Bank 100,000 20,000 1,648,000 Oregon City Bank of Oregon City 100,000 50,000 1,325,000 Portland Ladd & Tilton Bank 1,000,000 1,000,000 24,399,000 Redmond Redmond State Bank 25,000 5,000 216,000 Tillamook Tillamook County Bank 40,000 7,000 660,000 Total. 1,715,000 1,148,000 32,972,000 UTAH. Delta Delta State Bank 25,000 4,000 231,000 Kaysville Barnes BankingCo 50,000 50,000 439,000 Logan Thatcher Bros. Banking Co 150,000 50,000 1,603,000 Magna Magna Banking Co 25,000 3,000 260,000 Ogden Ogden Savings Bank 150,000 150,000 1,497,000 Payson Payson Exchangs Savings Bank... 50,000 25,000 540,000 Price Price Commercial & Savings Bank. 50,000 45,000 850,000 Provo Knight Trust & Savings Bank 300,000 15,000 1,743,000 Richfield James M. Peterson Bank 48,000 23,000 553,000 Do State Bank of Sevier 45,000 25,000 595,000 Salt Lake City.. Deseret Savings Bank 500,000 300,000 4,871,000 Do Farmers & Stockgrowers Bank 300,000 20,000 1,123,000 Do McCornick & Co., Bankers 600,000 120,000 10,889,000 Do Utah Savings & Trust Co 300,000 20,000 2,747,000 Do Walker Bros., Bankers 500,000 100,000 9,497,000 Total. 3,093,000 950,000 37,438,000 Digitized for FRASER 1 Newly organized. http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT STO. 12—SAN FRAHCISCO. 753 SCHEDULE 10.—State bank members of Federal Reserve Bank—Continued. Order City. of ad Bank. mis Capital. Surplus. Resources. sion. WASHINGTON. Albion Albion State Bank $25,000 $5,000 $110,000 Almira Almira State Bank 50,000 10,000 528,000 Centralia Centralia State Bank 100,000 10,000 474,000 Chehalis Coffman-Dobson Bank & Trust Co... 150,000 100,000 1,954,000 Colfax First Savings & Trust Bank 50,000 15,000 343,000 Enumclaw Peoples Bank 25,000 6,000 376,000 Farmington Bank of Farmington 25,000 5,000 243,000 Hoquiam . Lumbermans Bank 100,000 15,000 990,000 La Crosse First State Bank 60,000 15,000 703,000 Molson Molson State Bank. 25,000 4,000 227,000 North Yakima Yakima Valley Bank 100,000 18,000 1,384,000 Odessa Farmers & Merchants Bank 25,000 3,000 320,000 Port Townsend Merchants Bank 75,000 25,000 790,000 Reardan Farmers State Bank 25,000 10,000 535,000 Rosalia Bank of Rosalia 25,000 5,000 323,000 St. John Farmers State Bank 25,000 3,000 241.000 Seattle Dexter-Horton Trust & Savings Bank, 400,000 100,000 8,231,000 Do Metropolitan Bank 200,000 100,000 4,187,000 Do Scandinavian-American Bank 1,000,000 500,000 21,026,000 South Bellingham. Northwestern State Bank 100,000 60,000 1,658,000 Spokane Spokane & Eastern Trust Co 1,000,000 200,000 10,579,000 Stanwood Bank of Stanwood 25,000 10,000 549,000 Tacoma Fidelity Trust Co 500,000 300,000 7,402,000 Tekoa Citizens State Bank 25,000 10,000 380,000 Do Tekoa State Bank 30,000 15,000 428,000 Toppenish Traders Bank 25,000 10,000 506,000 Walla Walla Farmers Savings Bank 200„000 40,000 1,705,000 Wilbur State Bank of Wilbur 50,000 7,000 676,000 Total. 4,440,000 1,601,000 66,868,000 Total for district 11,673,000 4,388,000 160,690,090 SCHEDULE 11.—Comparative statement of number, capital, and resources of State members compared with all State banks, Nov. 1, 1918. NUMBER. Percent States. A b ll a n S k ta s. t e M S e t m at b e e r m a e g m e b o e f r banks. banks to all. Arizona '. 40 1 1.67 Calif ornia 579 4 .69 Idaho 136 24 17.65 Nevada 23 Oregon 176 12 6 82 Utah 102 8 7 84 Washington 282 28 9.93 Total 1,338 77 5.75 CAPITAL. Percentage of States. A b ll a n S k ta s. t e Mem b b an er k s S . tate c m ap e i m ta b l e o r f banks to all. Arizona $3,058,000 $500,000 16.35 Calif ornia 70,410,000 825,000 1.18 Idaho 14,362,000 1,050,000 24.07 Nevada 1,653,000 Oregon 8,719,000 1,715,000 19.67 Utah 2 7,517,000 2,525,000 33.59 Washington 14,809,000 4,440,000 29.98 Total 110,528,000 11,055,000 10.00 Digitized for FRAS1E0R0 823°—19 48 http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

754 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. SCHEDULE 11.—Comparative statement of number, capital, and resources of State mem bers compared with all State banks, Nov. 1, 1918—Continued. RESOURCES. Percentage State. A b ll a n S k ta s. t e Mem ba b n er k s S . tate o o f f r m es e o m ur b c e e r s banks to all. Arizona $50,568,000 $4,216,000 8.34 California 1,026,564,000 8,078,000 .79 Idaho - 147,153,000 10,961,000 23.25 Nevada 19,264,000 Oregon 108,791,000 32,972,000 30.31 Utah 2 88,325,000 32,458,000 36.46 Washington 177,526,000 66,868,000 37.67 Total 1,518,191,000 155,553,000 10.25 i Figures as of Aug. 31,1918. * Figures as of Oct. 5,1918. SCHEDULE 12.—Member banks in Twelfth Federal Reserve District authorized to accept drafts and bills of exchange up to 100 per cent of capital and surplus. Granted. Capital and surplus. San Francisco: American National Bank * June 7,1916 U, 300.000 Anglo & London Paris National Bank * May 15,1915 6,000,000 Apr. 27,1915 15,000,000 Crocker National Bank * May 15,1915 5,000,000 First National Bank * May 1,1915 4,500,000 Wells Fargo Nevada National Bankl Apr. 27,1915 9,500 000 Portland: First National Bank * July 9,1915 3,500,000 Ladd & Tilton Bank Nov. 27,1917 2,000,000 Northwestern National Bank July 23,1917 1,250,000 United States National Bank July 17,1917 2,500,000 Seattle: First National Bank July 9,1918 800,000 National Bank of Commerce * July 18,1916 1,500,000 Seattle National Bank „ , ,, Oct. 10,1918 1,200,000 Dexter Horton National Bank Dec. 4,1918 1,440,000 Seaboard National Bank Dec. 11,1918 240,000 Spokane: Exchange National Bank Oct. 17,1918 1,200,000 Spokane & Eastern Trust Co do 1,200,000 Old National Bank Oct. 28,1918 1,450,000 Total 59,580,000 i Permission automatically canceled by an omission in the act of Sept. 7, 1916. Renewed by general resolution of Federal Reserve Board, Aug. 9,1917. SCHEDULE 13.—Certificates of indebtedness—Third Liberty loan. National bank Other bank Trust company Individual sub Total, subscrib subscriptions. subscriptions. subscriptions. scriptions. ers' allotment. Date of 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. 1918. Jan. 22 174 $10,633,000 128 $6,905,000 21 $2,870,000 37 $592,000 360 $21,000,000 Feb. 8 357 12,726,000 471 7,497,000 45 2,626,000 45 2,151,000 918 25,000,000 Feb. 27 . 212 17,403,500 420 7,522,000 48 4,927.500 255 3,647,000 935 33,500,000 Mar. 20 348 17,117,500 426 9,501,500 46 3,379,000 10 252,000 830 30,250,000 Apr. 10 315 22,536,500 393 10,156,000 47 6,025,500 60 782,000 815 39,500,000 Apr. 22 204 12,515,000 250 7,008,000 26 2,838,000 50 1,179,500 530 23,540,500 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 12—SAK FRANCISQO. 755 SCHEDULE 14.—Certificates of indebtedness—Fourth Liberty loan. National-bank Other bank Trust-company Individual sub Total, subscrib subscriptions. subscriptions. subscriptions. scriptions. ers' allotment. Date of 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. 1918. June 25 255 $25,893,500 504 $12,005,500 52 $5,625,500 175 $4,475,500 986 $48,000,000 July9 350 20,276,500 468 12,603,500 43 4,768,500 154 1,351,500 1,015 39,000,000 July 23 374 24,009,000 503 9,342,000 53 4,512,000 23 137,000 953 38,000,000 Aug. 6 364 22, 893,000 537 9,545,500 51 5,234,500 23 77,000 975 37, 750,000 Sept. 3 474 25,509,500 748 17,334,000 58 6,639,000 9 17,500 1,289 49,500,000 Sept. 17 ,. 375 26,305,000 698 14,261,000 55 5,594,000 11 190,000 1,139 46,350,000 Oct. 1 396 28,630,000 663 12,413,000 53 5,367,500 4 9,500 1,116 46,420,000 SCHEDULE 15.—Certificates of indebtedness—Tax issues. National-bank Other bank Trust-company Individual sub Total, subscrib subscriptions. subscriptions. subscriptions. scriptions. ers' allotment. Date of 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. 1917. Nov. 30 16 $2,252,000 13 $1,285,000 2 $115,000 4 $360,000 35 $4,012,000 1918. Jan. 2 92 6,698,500 30 2, 724,500 16 1,135,500 108 9,074,000 246 19,632,500 M A M Fe u a a b g y . r . . 1 1 1 2 5 5 5 0 . . . . 1 6 2 2 2 5 2 2 3 0 5 6 9 2 2 7 8 1 1 , , , , , 0 6 5 5 8 4 8 2 1 4 6 8 4 9 0 9 4 0 , , , , , , 0 5 3 5 0 5 0 0 0 0 0 0 0 0 0 0 0 0 21 5 1 1 1 8 2 6 3 3 9 1 7 , , 4 0 3 6 2 7 8 2 7 0 1 3 1 5 8 8 3 4 , , , , , , 5 5 5 5 0 7 0 0 0 0 0 0 0 0 0 0 0 0 2 1 1 5 8 6 7 4 0 2 1 1 , , , 3 4 1 2 1 1 1 5 4 4 3 7 7 1 4 1 7 1 , , , , , , 5 0 5 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 • 2 1 1 1 3 1 2 3 2 7 7 2 0 3 5 0 3 3 3 2 6 , , , , , 3 7 7 4 9 2 3 9 7 6 3 9 5 7 2 6 9 1 , , , , , , 0 5 0 5 5 5 0 0 0 0 0 0 0 0 0 0 0 0 3 4 1 1 1 1 4 3 6 5 2 6 3 6 9 0 0 5 3 1 6 6 4 8 7 6 , , , , , , 4 0 2 1 4 2 1 6 9 6 0 7 7 6 9 4 2 4 , , , , , , 5 0 0 5 5 0 0 0 0 0 0 0 0 0 0 0 0 0 SCHEDULE 16.—Sales of Liberty loan bonds, classified by States and principal cities. STATES. Number of subscribers. Amount of subscriptions. Third loan Fourth loan. Third loan. Fourth loan. 37,024 53,616 $6,963,750 $9,531,350 California, Northern 495,336 723,939 114,602,200 204,427,000 Southern 263,287 426,626 59,910,250 86,707,950 Idaho 77,196 111,465 10,972,600 16,895,150 Nevada 23,129 29,282 4,793,400 5,996,150 Oregon 148,588 213,854 28,300.800 38,362,550 Utah 70,905 125,767 12,966;950 19,878,600 Washington 258,335 407,511 42,907,950 70,189,650 Alaska 9,988 12,080 1,737, 250 3,180,950 Hawaii 17,796 18,923 4,819,850 7,080,650 Grand total 1,402,584 2,123,063 287,975,000 462,250,000 CITIES. Arizona: Phoenix 9,606 14,711 $1,490,050 $2,363,200 Northern California: Alameda 7,995 13,012 787,650 1,342,800 Bakersfield 6,781 12,430 1,743,450 2,922,950 Berkeley 13,619 21,489 1,857,300 3,07Q,850 Eureka 4,532 7,231 701,150 1,417,700 Fresno 11,627 18,044 2,340,850 3,888,900 Oakland 53,777 80,525 7,530,900 13,629,550 Sacramento 17,078 30,927 4,631,850 8,860,100 San Francisco 149,993 241,266 55,892,900 110,836,150 San Jose „ 12,880 19,324 1,873,100 3,597,900 Santa Cruz 3,611 4,900 678,600 1,024,800 Stockton 11,657 19,446 3,916,150 4,980,650 Vallejo 3,229 4,363 398,250 815,400 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

756 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. SCHEDULE 16.—Sales of Liberty loan bonds, classified by States and principal cities.—Continued. CITIES—Continued. Number of subscribers. Amount of subscriptions. Third loan. Fourth loan, Third loan. Fourth loan. Southern California: Long Beach 13,572 14,468 $2,422,850 $2,796,000 Los Angeles 155,310 246,001 31,404,300 48,686,350 Pasadena 11,774 12,003 3,445,400 4,020,150 Pomona 1,961 3,093 358,000 674,350 Redlands 2,903 3,683 514,950 820,550 Riverside 2,856 5,375 664,000 970,850 San Bernardino. 3,322 7,360 702,800 1,254,050 San Diego 17,020 25,300 3,380,100 5,192,600 Santa Ana 4,714 5,522 902,400 1,806,800 Santa Barbara.. 3,707 7,340 1,446,000 2,003,200 Idaho: Boise .... 4,952 1,101,950 1,376,700 Nevada: Reno 4,966 6,047 958,300 1,309,050 Oregon: Astoria... 6,219 9,750 580,200 1,456,100 Eugene 2,204 3,372 458,500 548,700 Medford 1,772 1,875 276,250 308,010 Portland 60,291 90,125 14,832,100 19,586,250 Salem 4,153 5,561 616,400 951,650 Utah: Ogden 5,193 16,956 1,362,850 1,986,750 Provo 2,086 2,787 255,150 475,600 Salt Lake City.. 30,153 51,322 7,296,800 11,227,000 Washington: Aberdeen 5,370 11,046 601,750 1,491,200 Bellingham: 5,219 8,953 875,500 1,484,700 Everett 4,124 10,923 948,100 1,355,350 Hoquiam 3,360 6,083 431,600 961,450 Yakima 4,750 8,409 616,300 1,463,150 Seattle 78,079 132,652 15,174,750 29,536,050 Spokane 29,924 35,721 4,535,650 6,958,650 Tacoma '. 22,102 38,226 3,630,900 6,139,850 Walla Walla.... 3,671 4,460 1,277,650 1,383,400 Vancouver 4,086 7,229 1,459,450 739,550 SCHEDULE 17.—Subscriptions to third and fourth Liberty loans, by denominations. Number of subscribers. Total amount. Denominations. Fourth Third loan loan. Third loan; Fourth loan. $50 846,063 ,252,724 $42,303,150 $62,636,200 $100 405,288 534,793 26,419,700 53,479,300 $150 to $450 47,031 201,529 14,109,100 37,691,250 $ $ 5 5 0 5 0 0 to $950 T 5 5 3 , , 1 6 4 6 0 5 5 8 8 , , 6 6 4 04 0 2 4 2 , , 1 7 1 1 3 9 , , 2 3 0 0 0 0 2 6 9 , , 0 3 7 0 6 2, , 0 7 0 0 0 0 $1,000 to $1,950 26,074 37,561 44,484,950 40,719,200 $2,000 to $2,950 10,978 13,700 27,446,250 41,176,250 $3,000 to $3,950 1,482 2,555 5,188,300 7,872,400 $4,000 to $4,950 743 1 205 3,344,500 5,014,500 $5,000 2,131 5,563 4,761,400 27,815,000 $5,050 to $5,950 99 '151 534,250 836,950 $6,000 to $6,950 263 414 1,724,800 2,603,100 $7,000 to $7,950 218 347 1,691,350 2,536,950 $8,000 to $8,950 134 214 1,179,350 1,768,450 $9,000 to $9,950 78 117 763,850 1,095,250 $10,000 1,878 2,289 18,780,000 22,890,000 $10,050 to $50,000... 1,093 2,203 28,598,250 54,648,150 $50,050 to $100,000.. 131 305 10,014,350 22,587,150 $100,050 to $200,000. 52 68 7,720,850 10,346,850 Over $200,000 43 81 22,078,100 41,154,350 Total 1,402,584 2,123,063 287,975,000 462,250,000 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DISTRICT NO. 12—SAN FRANCISCO. 757 SCHEDULE 18.—Purchases of Liberty loan bonds. Third loan. Fourth loan. Through national banks $154,270,750 $244,586,150 Through other banks 98,851,650 123,243,050 Through trust companies 30,744,650 79,253,050 By individuals and corporations direct 4,107, 950 15,167,750 Total 287,975,000 462,250,000 SCHEDULE 19.—Payments for third Liberty loan bonds. Instal Instalment Advance pay Date. m du e e n . t pay c m ei e v n e t d s . re m in e g n p ts u c rc o h m a p s l e e s t . Bon p d a s i d f . u lly Per cent. May 4... 5 75,520,097.50 $137,573,050.00 $137,573,050.00 May 28.. 20 23,190,730.00 32,723,652.50 34,445,950.00 July 18.. 35 32,103,977.50 18,170,250.00 24,227,000.00 Aug. 15. 40 36,686,860.00 91,717,150.00 Dec.l... 16,382.50 2 11,850.00 Total. 100 99,508,047.50 188,466,952.50 287,975,000.00 1 Unpaid balance. 2 Bonds on which payment was not completed. SCHEDULE 20.—Payments for fourth Liberty loan bonds. Date. m I e n n s t t d al u e. p I a n y c s m e ta i e v l n m e t d s e . n r t e A p m d l v e e t a n i n t n s c g e c p o p u m a r y Bon p d a s i d f . u lly chases. Per cent. Oct. 19 10 $25,726,165 $204,983,700 $204,983,700 Nov. 21 20 40,694.270 48,289,770 53,655,300 Dec. 19 20 232,700 3,212,685 4,589,550 11,685 50 66,654,820 256,486,155 263,228,550 Unpaid balance 50 139,109,025 199,021,450 100 205,763,845 462,250,000 1 Payments in process of adjustment. SCHEDULE 21.—Character of Liberty loan payments. Third loan. Fourth loan. Cash $127,885,000 $107,977,692.22 Credit - 104,250,000 110,157,282.78 Certificate's of indebtedness 55,840,000 105,006,000.00 Unpaid balances i 139,109,025.00 287,975,000 462,250,000.00 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

758 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. SCHEDULE 22.—Sales, by months, of thrift and war-savings stamps by Federal Bank of San Francisco, December, 1917, to November, 1918, inclusive. Thrift stamps. War-savings certificates. Date. Total value. Units. Value. Units. M v a a t l u u r e i . t y 1917 December 494,668 $123,667.00 127,236 $636,180 $759,847.00 1918 January 627,760 156,940.00 213,974 1,069,870 1,226,8 10.00 February 470,995 117,748.75 183,245 916,225 1,033,9 73.75 March 658,441 164,610. 25 233,855 1,169,275 1,333,8 85.25 April 696,913 174,228.25 198,806 994,030 1,168,2 58.25 May 818,094 204,523.50 171,934 859,670 1,064,1 93.50 June 685,948 171,487.00 777,643 3,888,215 4,059; 702.00 July 494,414 123,603.50 750,939 3,754,695 3,878,2 98.50 August 408,413 102,103.25 402,295 2,011,475 2,113,5 78.25 September 505,181 126,295.25 320,983 1,604,915 1,731,2 10. 25 October 388,227 97,056.75 259,377 1,296,885 1,393,9 41.75 November 234,214 58,553. 50 178,581 892,905 951, 458.50 Total 1,620,817.00 3,818,868 19,094,340 20,715,157.00 SCHEDULE 23. -Analysis of business transacted by district committee on capital issues, 1918. Classification of issue. Total. Approved. Disapproved. No action. States and subdivisions $91,322,823 $30,586,452 $37,200,896 $23,035,475 Commercial and financial 46,993,474 35,575,199 11,918,275 111,736,844 52,308,435 57,928,409 1,500,000 Manufacturing 60,827,434 34,506,016 24,071,418 2,250,000 Development 75,264,682 41,039,095 32,036,492 2,189,095 Total 386,145,257 194,015,197 163,155,490 28,974,570 100 50 42 8 SUMMARY. Total issues considered by district committee $386,145,257 Projects directly discouraged at their inception which did not come up for consideration 74,000,000 Projects indirectly discouraged 26,000,000 Issues rising in the district acted upon by Capital Issues Committee directly without refer ence to district committee 24,000,000 Total 510,145,257 SCHEDULE 24.—Federal Reserve notes issued and redeemed by Federal Reserve agent during 1917 and 1918. Year. Fives. Tens. Twenties. Fifties. Hundreds. Total. 1916 $2,511,890 $1,775,800 $4,933,600 $1,980,100 $3,579,700 $14,781,090 1917 11,700,000 17,600,000 25,120,000 4,400,000 8,000,000 66,820,000 Outstanding Dec. 31, 1916, plus issued dur ing 1917 14,211,890 19,375,800 30,053,600 6,380,100 11,579,700 81,601,090 Unfit notes redeemed 1,729,430 955,690 1,496,670 146,150 175,600 4,503,540 Outstanding Dec. 31 12,482,460 18,420,110 28,556,930 6,233,950 11,404,100 77,097,550 1918 Issued during 1918 25,980,000 34,200,000 82,000,000 8,000,000 15,200,000 165,380,000 Outstanding Dec. 31, 1917, plus issued dur ing 1918 38,462,460 52,620,110 110,556,930 14,233,950 26,604,100 242,477,550 Unfit notes redeemed 5,300,955 3,694,730 3,795,730 204,100 243,700 13,239,215 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

SCHEDULE 25.—Comparative table of the banking resources of the Twelfth Federal Reserve District. [In thousands of dollars; i. e., 000 omitted.] Bank ing State and bank. Date. b N b a e u n r k m o s f . a c L n o d o u a n d n t i s s s . S b s o e t t o a i o t c n e n h c u d d s e k r . s r i s , , a h t f n o u t u d o t u r r h u n r e s f e e s i i r e , x , c a h C n a d a n s e h g x e . so O u r t r e h c e e r s . Total. Capital. a d S p n i u r v d o r i p f d u i l t e n u s d s . D ba u n e k t s o . i v m d t I s i e n a d — p d n u o i d d a s . e l v d t I i i e i n t d m p d s u o - e i a s . l c R o e u d n i t s . 1 r M b o a b o o w o n n n d e r d e d s y . s C l t a o i a i n t r u n i c g t o d . u n l O i t a i t b e h i s e l . r i real estate. Arizona: National banks Nov. 1,1918 10 7,165 2,554 360 3,200 123 13,402 925 766- 692 8,886 1,019 223 376 687 51 State banks do 40 26,929 8,336 1,584 13,719 50,568 3,058 2,665 24(3,390 3 1,455 National banks Nov. 20,1917 7 5,485 1,842 323 3,578 69 11,297 675 680 462 8,149 743 544 44 State banks do 39 27,490 5,807 1,544 15,036 49,877 2,996 2,393 2 44,253 3 235 California: National banks Nov. 1,1918 276 420,399 197,739 19,311 183,698 7,459 828,606 61,333 49,306 120,833 403,636 86,057 24,110 39,626 40,192 27,623 State banks4 do 579 590,191 249,526 37,458 130,007 19,382 1,026,564 70,410 47,164 22,793 217,825 640,955 1,810 6,180 19,427 Nov. 20,1917 270 398,593 145,917 17,761 208,803 20,094 791,168 59,525 48,912 133,943 394, 769 84,577 6,620 10,387 40,813 18,242 State banks5 do 571 575,072 218,233 35,849 142,786 21,261 993,201 66,186 47,042 20,594 210,581 625,281 126 871 22 520 Idaho: National banks Nov. 1,1918 68 31,687 14,040 1,810 11,869 221 59,627 4,030 2,586 3,753 31,725 9,839 2,956 4,542 3,095 57 State banks Aug. 31,1918 136 32,233 4,489 1,875 8,376 180 47,153 4,362 1,536 1,313 23,948 10,787 1,884 3,091 232 National banks Nov. 20,1917 63 30,571 10,234 1,662 13,709 281 56,457 3,789 2,591 5,139 32,438 9,265 349 140 3,021 74 State banks do 137 31,098 3,687 1,797 14,376 68 51,026 4,042 1,787 2,138 31,716 10,809 158 294 82 Nevada: National banks Nov. 1,1918 10 7,824 4,315 389 3,395 142 16,065 1,435 517 1,610 7,155 3,706 35 50 1,234 358 State banks do 23 10,735 2,400 627 4,875 627 19,264 1,653 819 281 7,989 7,940 582 National banks Nov. 20,1917 10 8,068 3,457 417 4,353 314 16,609 1,435 599 1,726 8,974 2,610 1,215 50 State banks do 23 10,525 2,429 680 4,963 244 18,841 1,846 773 397 8,162 7,560 103 Oregon: National banks Nov. 1,1918 84 87,662 34,520 4,474 37,721 465 164,842 10,226 7,178 13,421 93,223 26,925 1,418 1,581 6,324 5,964 State banks do 176 60,722 17,651 3,127 24,987 2,304 108,791 8,719 4,943 6,049 53,673 26,365 5,313 1,435 2,294 National banks Nov. 20,1917 81 71,737 29,814 4,526 32,807 856 139,740 9,591 6,717 13,733 76, 647 24,462 1,082 1,110 6,142 1,338 State banks do . 178 50,244 14,074 3,185 23,563 1,361 92,427 8,919 4,573 5,106 47,000 24,536 438 846 1,009 Utah: National banks Nov. 1,1918 25 28,909 14,957 2,107 11,726 272 57,971 3,430 2,538 10,208 22,977 9,600 4,497 5,778 3,261 179 State banks Oct. 5,1918 102 55,816 15,018 3,545 11,908 2,038 88,325 7,517 4,004 3,512 26,448 30,343 16,501 National banks Nov. 20,1917 24 30,460 9,764 1,816 15,239 63 57,342 3,405 2,501 12,467 24,121 9,939 540 1,445 3,236 228 State banks Oct. 8,1917 102 57,240 6,333 3,413 15,339 458 82,783 7,223 4,322 4,242 30,247 30,007 6,742 1 Not included in total liabilities for national banks. 3 Rediscounts included. 5 Includes 134 branches. 2 Due banks, demand and time deposits included. 4 Includes 150 branches. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

SCHEDULE 25.—Comparative table of the banking resources of the Twelfth Federal Reserve District—Continued. -a a o [In thousands of dollars; i. e., 000 omitted.] Bank ing State and bank. Date. b N b a e u n r m k o s f . a c L n o d o u a n d n t i s s s . S b s o e t t o a o i t c n n e h c u s d d e k r . s r i s , , a h f t n o u u t o d t u r r u h n r e f s e e i i s e x r , , c a h C n a d a n s e g h x e . so O u r t r e h c e e r s . Total. Capital. d a S p n i u r v d o r i p f d u i l e t u n s d . s D ba u n e k t s o . i v d m t I s e i n — a d p d n u o i d d a s e l . v d t I i e i i t n d m s p d — u o e i a s . l c R o e u d n i t s . 1 r M b o b a o w o n o n n d e r d e d s y . C l s a o i t i n t a r u i c g o n t u . n d l O i t a i t b e h i s e l . i r real estate. ohj w Washington: H National banks Nov. 1,1918 81 107,487 53,499 4,988 49,072 4,720 219,766 12,285 7,573 21,421 111,750 47,136 5,278 9,439 6,785 3,377 State banks do 282 108,061 39,975 9,764 38,125 3,783 199,708 14,809 10,319 10,365 90,404 67,273 2,950 2,093 1,495 C National banks Nov. 20,1917 78 96,599 44,703 4,665 47,332 3,097 196,396 11,810 7,368 23,448 96,205 47,021 518 2,005 6,680 2,859 State banks do 285 94,304 30,206 10,625 38,502 3,889 177,526 15,657 9,651 10,254 77,448 60,742 648 715 2,411 H Total, twelfth district: National banks Nov. 1,1918 554 691,176 321,723 33,444 300,834 13,399 1,360,576 93,689 70,467 172,061 679,492 184,282 38,517 61,402 61,578 37,605 w State banks 1,338 884,687 337,395 57,980 231,997 28,314 1,540,373 110,528 71,450 44.313 463,677 783,663 11,957 14,254 40,531 National banks Nov. 20,1917 533 641,513 245,731 31,170 325,821 24,774 1,269,009 90,230 69,368 190,918 641,303 178,617 9,109 14,087 61,651 22,833 State banks 1,335 845,973 2&0,769 [ 57,093 254,565 27,281 1,465,681 106,869 70,541 42,731 449,407 758,935 1,370 2,961 32,867 g < w o Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

PART III. RECOMMENDATIONS OF THE FEDERAL ADVISORY COUNCIL TO THE FEDERAL RESERVE BOARD FOR THE YEARS 1915-1918. 761 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

BY-LAWS OF THE FEDERAL ADVISORY COUNCIL ARTICLE I.—OFFICERS Officers of this council shall be a president, vice president, and secretary. ARTICLE II.—PRESIDENT AND VICE PRESIDENT The duties of the president shall be such as usually pertain to the office; and in his absence the vice president shall serve. ARTICLE III.—SECRETARY The secretary shall be a salaried officer of the council and his duties and compensation shall be fixed by the executive committee. ARTICLE IV.—EXECUTIVE COMMITTEE There shall be an executive committee of five (5) members of the council, of which the president and vice president of the council shall be ex-officio members. ARTICLE V.—DUTIES OF EXECUTIVE COMMITTEE It shall be the duty of the executive committee to keep in close touch with the Federal Reserve Board and with their regulations and promulgations, and communicate the same to the members of the council, and to suggest to the council from time to time special matters for consideration. The executive committee shall have power to fix the time and place of holding their regular and special meetings and methods of giving notice thereof. Minutes of all meetings of the executive committee shall be kept and such minutes or digest thereof shall be immediately forwarded to each member of the council. A majority of the executive committee shall constitute a quorum and action of the committee shall be by a majority of those present at any meeting. 763 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

764 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. ARTICLE VL—MEETINGS- Regular meetings of the Federal Advisory Council shall be held in the city of Washington on the third Monday of the months of Febru ary, May, September, and November of each year. Special meetings may be called at any time and place by the president or the executive committee, and shall be called by the president upon written request of any three members of the council. ARTICLE VIL—AMENDMENTS These by-laws may be changed or amended at any regular meeting by a vote of a majority of the members of the Federal Advisory Council. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

RECOMMENDATIONS OF THE FEDERAL ADVISORY COUNCIL TO THE FEDERAL RESERVE BOARD FOR THE YEAR 1915, Recommendations of the Federal Advisory Council to the Federal Reserve Board Contained in President's Letter to Federal Reserve Board Dated December 24, 1914. (Approved January 18, 1915.) CHICAGO, December 24, 1914. Mr. H. PARKER WILLIS, Secretary Federal Reserve Board, Washington, D. C. DEAR SIR: At a meeting of the executive committee of the Federal Advisory Council held in New York December 18, 1914, the various matters referred to it by the Federal Reserve Board as stated in your letter of the 17th instant were, duly considered. The findings of the committee have since been communicated to the other members of the council and by them approved. The following are therefore the suggestions of the Federal Advisory Council in regard to the five matters referred to it: TOPIC NO. 1. The Purchase of Warrants and Acceptances. A.—Warranter. * ^ Recommendation.—The proposed regulation covering section 14, clause B, of the Federal Reserve Act as prepared by the Federal Reserve Board and submitted to the Federal Advisory Council at its meeting in Washington on December 17th, 1914, meets with the approval of the council. B.—Acceptances. Recommendation.—The council advises that for the present Federal Reserve Banks should confine their purchases of acceptances to those of member banks of any of the twelve Federal Reserve districts or of acceptances indorsed by member banks. It is the opinion of the council that it is undesirable that there should be upon the face of such acceptances any statement of detail connected with the trans action originating the bill which might affect its negotiability. TOPIC NO. 2. The Regulations under which National Banks may act as Trustee, Executor, etc. Recommendation.—The council suggests that as national banks are to be given the right to act as trustee, executor, etc., by a special 765 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

766 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. permit granted them by the Federal Reserve Board each application for this privilege should be decided by the Board on its merits and with due regard to the State laws under which the applicant bank would have to operate. As national banks so acting would do so under the laws of the State in which they are located, it would seem impractical to undertake the formulation of general regulations to be applied to all alike. TOPIC NO. 3. The Definition of Time Deposits and Savings Accounts. Recommendation.—In view of the terms of section 19 of the Federal Keserve Act the Federal Advisory Council is of the opinion that regulation No. 7 A, fifth draft, submitted by the Federal Reserve Board, with a slight change hereafter suggested, satisfactorily defines the kind of deposits upon which 5 per cent lawful reserve is permitted. The change suggested is that the words "checked upon or" in the second line of section 1, headed "Time deposits" be left'out. The council, however, believes that the actual operation of savings accounts under the definition of them contemplated by this regulation will permit the conversion of a large volume of deposit liability now subject to a requirement of 12, 15, or 18 per cent legal reserve into nominal savings accounts on which only 5 per cent reserve is required and which will nevertheless be virtually demand deposits to be with drawn at any time without notice. In"the opinion of the council bona fide savings deposits upon which a 5 per cent legal reserve may be justified should be limited in the amount which may be deposited by any one depositor. The unre stricted permission for national banks to receive deposits without limit as to the amount of each individual account upon which they may exact a notice of 30 days, but in ordinary practice will not do so (as is the custom generally now in connection with savings accounts) may result in the conversion of so large a volume of demand deposits into so-called savings accounts as to prove a menace to the system. The council therefore recommends that steps be taken to secure an amendment to the statute by which a reasonable limit may be placed upon the amount of a savings account which may be maintained by any one depositor on which only 5 per cent legal reserve is required. TOPIC NO. 4. Check clearings. Recommendation.—The Federal Advisory Council is unable at present to make definite suggestions on this subject. As a preliminary the Federal Reserve Board or its counsel should determine whether under section 13 and 16 of the Federal Reserve Act Federal Reserve Banks are either permitted or required to Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

EECOMMENDATIONS OF THE FEDERAL ADVISORY COUNCIL. 767 receive on deposit from their depositors checks drawn upon member banks or Federal Reserve Banks of other districts. As the council reads these sections such checks can only be received on deposit by a Federal Reserve Bank " when remitted by " another Federal Reserve Bank and then solely for exchange purposes. In the opinion of the council it is unsound in principle and wrong in practice that a check drawn on a member bank should be charged to its reserve account with a Federal Reserve Bank without its authority and without its having had an opportunity to pass upon it. The council fears that the attempt being made by some of the Federal Reserve Banks to disregard the elements of time and distance in connection with the clearing of bank checks may so involve and absorb the funds of the Federal Reserve Banks as to seriously impair their usefulness as banks of issue and discount. TOPIC NO. 5. The regulations under which State banks are to be admitted to the system. Recommendation.—The council finds the suggestions of the Federal Reserve Board on this subject as contained in its draft circular No. 78 to be substantially along right lines. The chief inducement, however, for State banks to come into the system is in connection with the clearing of so-called country checks and until this matter is developed to such a point that State banks may definitely know just what advantages may accrue to them in that connection it seems futile to prepare regulations for their joining the system. Moreover, the great obstacle to their joining the system is that once in they may be unable to withdraw. The council therefore advises the Federal Reserve Board to get advice of counsel as to whether it is able by regulation to establish a method whereby State banks entering the system may upon sufficient and reasonable notice and on equitable terms withdraw from it. I have the honor to be respectfully, yours, JAS. B. FORGAN, President, Recommendations of the Federal Advisory Council to the Federal Reserve Board January 19, 1915. TOPIC NO. 1. Bankers Acceptances and Bills of Exchange. Recommendation.—That for the present at least we deem it wise for the Federal Reserve Banks to buy in the open market under section 14 bankers' acceptances and bills of exchange only when such bank ers' acceptances or bills of exchange are the acceptances or bear the indorsement of member banks. Such purchases should also be sub ject to the following limitations provided for acceptances under sec tion 13, when offered for discount, as follows: Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

*768 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. "Any Federal Reserve Bank may discount acceptances which are based on the importation or exportation of goods and which have a maturity at time of discount of not more than three months. The amount of acceptances so discounted shall at no time exceed one-half the paid-up capital stock and surplus of the bank for which the rediscounts are made." TOPIC NO. 2. Commercial Paper. Recommendation.—The Federal Advisory Council submits the Fed eral Reserve Board's Circular No. 3 with the accompanying Regula tion B, dated January 15, 1915, altered to meet its views, as follows: CIBCTJLAR NO. 3—SERIES OF 1915. {Superseding Circular 13 of 1914.] FEDERAL RESERVE BOARD, Washington, January 15, 1915. COMMERCIAL PAPER. When Circular No. 13, bearing date of November 10, 1914, and the accompanying regulations were issued it was believed that a period of two months would suffice to enable member banks to familiarize their customers with the requirements of Regu lation No. 4 of 1914. It appears, however, that in many districts the needed read justments of banking and business practice can not be effected in so short a period. An extension of time has therefore been asked by both member banks and their customers for the purpose of adjusting their methods to the new requirements. To meet these requests the Board has by Regulation A, accompanying Circular No. 2, Series of 1915, extended Regulation No. 3, Series of 1914, for a period of six months, or until July 15, 1915, subject to the modifications contained in the accompanying regulation (B—1915) which supersedes Regulations Nos. 2 and 4 (1914). The Board includes in this regulation (paragraph III) a new method for certifying to the eligibility of bills for rediscount. While banks will not be required to comply with the provisions of this paragraph until after July 15, the new method prescribed is made a part of this regulation in order that advance notice may be given to all banks so that those which are equipped to do so may begin to operate under its pro visions as soon as possible. The Board suggests, furthermore, that Federal Reserve Banks insist that the accompanying regulation be applied as promptly as possible to all so-called ''purchased paper" (that is, paper bought through brokers or otherwise from customers with whom the purchasing bank has no direct business relation). Where such direct connections do not exist the requirement that statements, both as to business conditions and methods of borrowing, be furnished appears to be a matter of prudence and should not be delayed. Some borrowers may not be able to give a statement in the required form until after the close of their business year. In such cases statements for the previous year may be accepted, even though they may not contain all the desired data. While it has been thought best not to insist, as a mandatory requirement, upon a written statement in the case of limited borrowings by depositors, when officers of member banks, from their own personal knowledge, certify to the eligibility of the paper for discount, it is urged, nevertheless, that member banks do their utmost to accustom their borrowers to furnishing such statements. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

RECOMMENDATIONS OF THE FEDERAL ADVISORY COUNCIL. 769 In order to facilitate operations, particularly during the initial period, the manda tory requirements as to the contents of borrowers' statements have been modified, but banking prudence requires that whenever possible the observance of the rules originally prescribed should be encouraged. CHARLES S. HAMLIN, H. PARKER WILLIS, Governor. Secretary. REGULATION B—SEItIES OF 1915. [Superseding Regulations 2 and 4 of 1914.] FEDERAL RESERVE BOARD, Washington, January 15,1915* COMMERCIAL PAPER. The word "bill," when used in this regulation, shall be construed to include notes, drafts, or bills of exchange, and the word "goods" shall be construed to include goods, wares, merchandise, or staple agricultural products, including live stock. 1. STATUTORY REQUIREMENTS. The Federal Reserve Act provides that a bill (other than an acceptance covered by the regulation accompanying Circular No. —), to be eligible for rediscount by a member bank with a Federal reserve bank, must comply with the following statutory requirements: (a) It must be indorsed by a member bank, accompanied by a waiver of demand notice and protest. (b) It must have a maturity at the time of discount of not more than 90 days, except as provided by Regulation C, accompanying Circular No. 4, Series of 1915. (c) It must have arisen out of actual commercial transactions; that is, be a bill which has been issued or drawn for agricultural, industrial, or commercial purposes, or the proceeds of which have been or are to be used for such purposes (d) It 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, but the pledge of "goods" as security for a bill is not prohibited. II. CHARACTER OF PAPER ELIGIBLE. The Federal Reserve Board, exercising its statutory right to define the character of a bill eligible for rediscount by Federal reserve banks, has determined: (a) That it must be a bill the proceeds of which have been used or are to be used in producing, purchasing, carrying, or marketing "goods" in one or more of the steps of the process of production, manufacture, and distribution; (b) That no bill is "eligible" the proceeds of which have been used or are to be used, (1) For permanent or fixed investments of any kind, such as land, buildings, ma chinery (including therein additions, alterations, or other permanent improvements, except such as are properly to be regarded as costs of operation). It may be considered as sufficient evidence of compliance with this requirement if the borrower shows, by statement or otherwise, that he has a reasonable excess of quick assets over his current labilities on open accounts, short-term notes, or otherwise; (2) For investments, whether made in "goods" or otherwise, of a merely speculative nature. III. METHOD OP CERTIFYING ELIGIBILITY. The Federal Reserve-Board has adopted the following method by whieh member banks, after July-15,1015, shall certify that a bill io eligible for rediscount when apply ing for rcdioeount thereof: 100823°—19 49 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

770 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. (a) In tho caoo of a bill which haa been diocountcd for one of ito own depositor*?,1 provided cither (1) such bill bcaro the oignaturoo of the purchaoor and the •seller of the goodo, and containa a otatoment on ito face that it wao iooucd for goodo actually purchaocd or sold, or (2) the aggregate amount of obligations of ouch depooitor rcdiocounted and offered for rcdiocount doea not exceed $5,000, but in no event a oum in excooo of ten per cent of tho paid in capital of the member bank. Every member bank will be required to certify in the letter of application, over the signature of a duly authorized officer, that, to the best of his knowledge and belief, the bill was issued for one of the purposes mentioned in paragraphs I (c) and II (a) hereof and that it conforms to the provisions of the act and the requirements of this regulation. Ill (a) (1) and (2)hcrcof or of a bill purchaocd othcrwioc than from one of ito own depooitoro, the member bank ohall placc-a certificate-upon the bill oubotantially to Eligible for rediocount with Federal rcocrvo banko undcr-Fcdoral-Rooorvo Board ale Name of member bank, ef which certificate ohall be deemed a rcpreocntation by the member bank that, to tho boot of the knowledge and belief of ito duly authoriecd officcro, the bill conformo to •the provioiono of the act and the requiremento of thio regulation. For the purpooe of enabling it to affix tho above certificate > Every member bank should maintain a credit file, bearing an identification number or name, which should contain a statement of the financial condition of the borrower, either signed by the borrower or duly certified by a member bank or notary public, to be a copy of a signed statement. Such statement should contain all the information essential to a clear and correct knowledge of the borrower's credit and of his methods of borrowing. A schedule specifying certain information which such statement should include and the main points to be observed is hereto appended. Regulations Nos. 2 and 4 of 1914 are hereby revoked. CHARLES S. HAMLIN, Governor. H. PARKER WILLIS, Secretary. APPENDIX. INFORMATION TO BE INCLUDED IN CREDIT FILES OF MEMBER BANKS. The credit files of member banks, referred to in the above regulation, should include information concerning the following matters: (a) The nature of the business or occupation of the borrower; (b) If an individual, information as to his indebtedness and his financial responsi bility; (c) If a firm or corporation, a balance sheet showing quick assets, slow assets, per manent or fixed assets, current liabilities and accounts, short-term loans, long-term loans, capital (and surplus); (d) The maximum and minimum amount of short term loana during the preceding year and tho anticipated maximum during the prcocnt year-* (o) A otatoment evidencing the purpooe of ouch ohort term loano and the policy of tho borrower in financing olow, permanent, or fixed aoocto; (f) All contingent liabilities, such as indorsements, guaranties, etc.; (g) Particulars respecting any mortgage debt and whether the mortgage is a lien on current assets; (h) Such other information as may be necessary to determine whether the borrower Digitized foisr eFnRtAitSleEdR t o credit in the form of short-term loans. http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

RECOMMENDATIONS OF THE FEDEEAL ADVISORY COUNCIL. 771 The following members of the Federal Advisory Council were present at this meeting: President James B. Forgan, in the chair; Vice Presi dent L. L. Rue, J. P. Morgan, D. G. Wing, W. S. Rowe, George J. Seay, Charles A. Lyerly, Rolla Wells, C. T. JafTray, J. Howard Ardrey, Archibald Kains; and Merritt H. Grim, secretary. Recommendations of the Federal Advisory Council to the Federal Reserve Board contained in President's letter to F. A. Delano, Vice- Governor of the Federal Reserve Board dated March 7,1915. (Ap proved AprO 20, 1915.) Mr. Delano's letter is as follows: WASHINGTON, March 5, 1915. DEAR MR. FORGAN: The Board will soon have to deal for the first time with the question of rediscounting between Federal Reserve Banks, and has already discussed the matter informally. As the first transaction of this kind may be regarded as establishing a principle, the Board deems it wise to advise you that this question is now under consideration, in order that you may have an opportunity of giving it the benefit of any suggestions that you may deem proper to make. There seem at present to be no serious difficulties in connection with rediscount operations between districts, and the Board does not feel that the matter warrants calling the Advisory Council together for conference. Should you, however, enter tain a contrary opinion, we would be glad at any time to meet the Council or its Executive Committee for a discussion of the question. The Federal Reserve Bank of Atlanta has now under discount for its member banks commercial paper aggregating approximately $5,200,000, and its net cash reserve against its liabilities is but a little more than 45 per cent. We are approaching a season when southern banks begin to rediscount freely, and it is probable that the Federal Reserve Banks in the southern districts will before long have occasion to ask other Federal Reserve Banks to discount for them. The suggestion has been made that any Federal Reserve Bank so desiring should have an opportunity of participating pro rata in the purchase of paper from the southern reserve institutions. As you recall, the Board early in January favored a reduction of interest rates in the southern districts in order to encourage the retirement of Aldrich-Vreeland currency, and the low rates obtaining have been effective in materially reducing the amount of Aldrich-Vreeland currency outstanding in the South. It seems probable in fact that by April 1st there will be practically no National Bank notes in circulation in the South except those secured by United States bonds. When the Board approved the present discount rates for the southern banks it was realized that the banks would sooner or later reach a point where they must redis count, thus giving an opportunity for Federal Reserve Banks in other sections to employ profitably some of their funds in the South. As you know, section 11, of the Federal Reserve Act, imposes upon the Board the duty of permitting or requiring Federal Reserve Banks to rediscount for each other, at rates to be fixed by the Federal Reserve Board. While the Board would prefer to adopt a policy, as far as the public interests will permit, of leaving the initiative in these transactions to the Federal Reserve Banks, from whom it expects shortly to receive suggestions as to rates, it seems proper that the Board should formulate its own views regarding the subject, particularly as these rates must ultimately be fixed by the Board. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

772 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. It seems to the Board that in considering the question, that the Federal Reserve Banks may be properly regarded as component parts of a unified system, as the prestige and success of the entire Federal Reserve System is involved. Just now it is a problem with some of the Federal Reserve Banks to earn their operating expenses and dividends without adding to the dangers inherent in a great abundance, of money, which condition now exists in certain districts. On the other hand, the country at large, not yet thoroughly understanding the problems peculiar to Federal Reserve Banks, may view with disappointment, even though without reason, the inability of any of the banks to earn a proper return. Those Federal Reserve Banks which will have occasion to negotiate for a redis count of their paper will have found locally ample opportunities of employing their funds. For example, the bank of Atlanta has at present invested more than 310 per cent of its capital, which even at 4 per cent should mean a gross return of 12J per cent, so that the organization and operating expenses and a dividend of 6 per cent would appear assured. Whatever this bank would earn in excess of 6 per cent would go, one-half to its surplus account and the other half to the Government. An abnormally low discount rate granted by other Federal Reserve Banks to Atlanta might, therefore, bring about the anomalous position of a profit to the Government from that bank at the expense of other Federal Reserve Banks which might not be making their dividends. As dividends are cumulative, the ultimate result to the Government and the banks will be the same. It appears, therefore, that it would be more rational, satisfactory and helpful for all the banks to earn their dividends if it can be done with due regard to conservatism. Present conditions are abnormal, as the demand for banking accommodation is confined mostly to the South. In normal times banks desiring to dispose of paper are the recipients of a service rendered by other banks, and the rates fixed for these rediscount operations generally express this condition. Ordinarily, one Federal Reserve Bank would regard its first duty as being to its own member banks, and would feel that in placing funds at the disposal of other districts at the rate given its own member banks that it would be acocrding as liberal treatment to others as could be expected. This would suggest a rate of around 4 per cent at this time, as that is the lowest rate now prevailing in any of the districts. However, the argument may be made that the ruling rates in many districts are nominal, as under them but little business is being secured by the banks. The natural eagerness caused by present conditions should not lead the Federal Reserve Board or the banks to a policy of exaggerated liberality, which would not add to the actual profits of the banks which are expected soon to offer their paper for rediscount, but might lead to over-stimulation of expectations, with inevitable disappointment later on. I have written you at length in order to put the matter before you fully, and will be glad to have an expression of your views by telegraph it possible. Very truly, yours, F. A. DELANO, Vice Governor. Mr. Forgan's reply is as follows: AUGUSTA, GA., March 7, 1915. DEAR MR. DELANO: I am in receipt of your favor of the 5th inst. and hasten to answer it Under present conditions I assume that such Federal Reserve Banks as lack a local demand for rediscounts will be glad of an opportunity to rediscount for such banks as are having more demand than they can supply. Under such conditions the accommodation is mutual and the benefits should also be mutual between the Federal Reserve Banks requiring assistance and those fur nishing it. It may be assumed that the southern banks are supplying a legitimate Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

RECOMMENDATIONS OF THE FEDERAL ADVISORY COUNCIL. 773 which are abnormally low for the particular districts. The strength of the demand for rediscounts should measure and govern the current rate for them in each district and the rate should be promptly raised—not unduly—whenever the demand increases beyond the ability of the local banks to supply it from their own resources. Under these circumstances the Federal Reserve Banks of the southern districts may rea sonably and equitably be entitled to make some profit on the commercial paper with which they supply the banks in other districts which from the standpoint of earnings need it so much. In other words, they should be paid for their indorsement of the paper they rediscount. It would therefore seem that the local rediscount rate of Federal Reserve Banks reaching the limit of their own resources should be promptly raised say 1 per cent above the rates current in the districts where no such local demand prevails. The banks in the districts having a brisk local demand could then rediscount at a profit with the banks in the districts lacking such demand. As to establishing a principle governing the fixing of rates of discount between Federal Reserve Banks, in my opinion, the Federal Reserve Board will have to recognize and be governed by conditions as they exist from time to time. If the demand for rediscounts by a particular Federal Reserve Bank should be caused by a falling off in its deposits or reserve resources at a time when all the banks are experiencing similar conditions to a greater or less degree, then such particular bank should not expect to make a profit on the paper it requires to rediscount but should be glad to supply its indorsement without actual profit. Under conditions as they now exist it would seem to me that the rates current in districts having a rediscount demand beyond the resources of their own Federal Reserve Banks should be established at 1 per cent above the rates current in dis tricts suffering for lack of such a demand and that rediscounts between Federal Reserve Banks should be made at the rates current at the banks granting the redis count. It would be very desirable, I think, to let any Federal Reserve Bank so desiring have an opportunity of participating pro rata in the rediscounting of paper for the southern reserve banks. I think most of them would be willing to have the business transacted through the Federal Reserve Bank of New York and to have their accounts with it charged with their pro rata share of any rediscount made. In this way the risk on the paper rediscounted would be equalized among all participating banks. This doubtless would be more convenient for the borrowing banks and the book keeping between the loaning banks and the New York bank would be a simple matter. These are my personal views on the subject of rediscounting between Federal Reserve Banks. A copy of this letter will be sent to each member of the Advisory Council so that any member desiring to express his views on the subject will have an opportunity of doing so by writing directly to you. Very truly, yours, JAS. B. FORGAN, President Advisory Council. Recommendations of the Federal Advisory Council to the Federal Reserve Board April 20, 1915. TOPIC NO. l. First: Attention is drawn to Circulars 11 and 12 and to Regulations "J" and "K" in respect to acceptances (12 copies attached). Are there any further suggestions on this subject? What is the opinion of the Advisory Council as to the policy of allowing the Federal Reserve Banks to buy the acceptances of State banks and private banks, regardless of the limitations, when national banks are limited by law to one hundred per cent of capital and unimpaired surplus? A ruling, or even a suggestion by the Board that the Federal Reserve Banks should not buy acceptances of banks beyond the limitations fixed for member banks might at Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

774 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. this time be taken as an intended "slap" at trust companies and might later be used as an argument against the Board in the future should it ever advocate the removal of this limitation. What are the views of the Advisory Council on this question? Recommendation.—The Federal Advisory Council after careful consideration of the subject of acceptances as set forth in the first question submitted by the Federal Reserve Board under date of April 8, 1915, begs to advise that it has not changed its opinion in relation to this question as stated in its communication of January 19, 1915, as follows: That for the present at least we deem it wise for the Federal Reserve Banks to buy in the open market under section 14, bankers' acceptances and bills of exchange only when such bankers' accept ances or bills of exchange are the acceptances or bear the endorse ment of member banks. Such purchases should also be subject to the following limitations provided for acceptances under section 13, as amended, when offered for discount, as follows: Any Federal Reserve Bank may discount acceptances which are based on the importation or exportation of goods and which have a maturity at time of discount of not more than three months. The amount of acceptances so discounted shall at no time exceed the paid-up capital stock and surplus of the bank for which the rediscounts are made. But as the Federal Reserve Board has decided to allow Federal Reserve Banks to purchase acceptances of State banks and bankers in the open market, it is the opinion of the Federal Advisory Council that such purchases should be limited to such State banks and bankers whose issue of acceptances does not exceed one hundred per cent of their capital and surplus fund. TOPIC NO. 2. The Federal Reserve Act provides for the discount or purchase of acceptances based upon the importation or exportation of goods. It has been suggested that im portation and exportation should not and can not properly be limited to importation and exportation to or from the United States and its dependencies. What is the view of the Advisory Council on this question? Recommendation.—It is the opinion of the Federal Advisory Council that acceptances based upon the movement of goods or merchandise between foreign countries should be eligible for discount or purchase by the Federal Reserve Banks. TOPIC NO. 3. The Federal Reserve Board has under consideration the preparation of a circular and regulation on the subject of the purchase in the open market (under section 14) of bills of exchange, foreign or domestic. Recognizing, however, that it was of great importance to safeguard these provisions in every way, yet if safely possible, to provide for the purchase of bills of exchange (e. g., documentary bills or bills secured by staples) accepted either by merchants or manufacturers in good stand ing against goods actually purchased by them. What are the views of the Ad visory Council on this question, and is it desirable for Federal Reserve Banks to Digitized for FgRoA inStEoR t he foreign-exchange business at this time? http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

RECOMMENDATION'S OF THE FEDERAL ADVISORY COUNCIL. 775 Recommendation.—We do not believe that the present is a pro pitious time for the Federal Reserve Banks to go into the foreignexchange business. It is the opinion of the Federal Advisory Council that present financial and business conditions do not make it desirable or neces sary for the Federal Reserve Banks to go into the open market to purchase domestic acceptances of merchants and manufacturers. TOPIC NO. 4. The subject of the admission of State banks has been before the Board for several months. On the one hand it is argued that State banks should not be permitted to enter unless they submit to all the conditions that are necessary for national banks; that if more favorable terms are granted to State banks, even if allowable by law, it will be taken as an evidence of weakness or will cause national banks to seek State charters. On the other hand, it is argued that if the rules for ad mission are drastic, only the smaller and weaker State banks will come in; that strong State banks doing a large commercial business will never come in unless liberal concessions are made, most important among them the privilege of with drawal from the system on suitable notice. In connection with the whole matter it is suggested by some that an effective clearance system, added to the discount privilege, will be a sufficient attraction to bring in the larger State banks without other concessions. What are the views of the Advisory Council on these ques tions? Recommendation.—The Federal Advisory Council appreciates the desirability of securing the admission of the State banks into the Federal Reserve System. We would therefore suggest that the Federal Reserve Board proceed to formulate such regulations as in its judgment are proper and would request that before their circular on the subject is issued this council be given an opportunity to consider it. TOPIC NO. 5. Section 19, paragraphs 164 and 165, reads as follows: The reserve 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 reserve required by law is fully restored. The first part of this paragraph has an important bearing on clearances. Thus far, the Federal Reserve Board has issued no regulations in respect to the proviso. What are the views of the Advisory Council on this subject? Recommendation.—In the opinion of the Federal Advisory Council it is unsound in principle, and in general practice would be destruc tive, to allow member banks to reduce their reserves below the legal requirement. Legal reserves should be maintained in the Federal Reserve Banks as a basis for credit to be extended by the Federal Reserve Banks to their members. Therefore a sufficient penalty should be imposed and strictly enforced to discourage the practice, Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

776 ANNUAL, REPORT OF THE FEDERAL RESERVE BOARD; and to induce member banks to rediscount with the Federal Reserve Banks for the purpose of maintaining their own reserves and pro viding themselves with necessary funds to meet their obligations. TOPIC NO. 6. Does the Advisory Council wish to give aivy views about the rediscount policy to be followed between Federal Reserve Banks? Recommendation.—It was decided that the Federal Advisory Council had nothing to add to the views expressed in the letter of the president on this subject addressed to Vice Governor Delano on March 7, 1915. Additional recommendation.—Being two resolutions passed by the Federal Reserve Bank of Chicago on April 9, 1915, and presented to the Federal Advisory Council at its request by Mr. James B. Forgan. Approved by the Federal Advisory Council April 20,191-5, and ordered submitted to the Federal Reserve Board. Resolved, That it is the opinion of the board of directors of the Federal Reserve Bank of Chicago that the Federal Reserve Banks should buy domestic acceptances only from member banks with their endorsement. Resolved, That Mr. Forgan be requested to convey to the Advisory Council the opinion of the board of directors of the Federal Reserve Bank of Chicago, that the tendency of member banks to put into "time deposit" or "30-day-notice account" a part of their commercial deposits in order to reduce the reserve requirements to 5 per cent is inimical to the commercial interests of the country and dangerous to the member banks. The following members of the Federal Advisory Council were present at this meeting: President, James B. Forgan, in the chair; vice-president, L. L. Rue; D. G. Wing, W. S. Rowe, George J. Seay, Charles A. Lyerly, Rolla Wells, E. F. Swinney, J. Howard Ardrey, and Merritt H. Grim, secretary. Recommendations of tjie Federal Advisory Council to the Federal Reserve Board contained in President's letter to F. A. Delano, Vice Governor of the Federal Reserve Board, dated May 21, 1915. (Ap proved September 21, 1915.) TOPIC. Topic circular No. 188c, which follows: [Tentative Regulation No. , Series of 1915.] FEDERAL RESERVE BOARD, WASHINGTON. STATE BANKS AND TRUST COMPANIES AS MEMBERS OF THE FEDERAL RESERVE SYSTEM. STATUTORY REQUIREMENTS. The Federal Reserve Act provides: " Section 9. Any bank incorporated by special law of any State, or organized under the general laws of any State or of the United States, may make application to the reserve bank organization committee, pending organization, and thereafter to the Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

RECOMMENDATIONS OF THE FEDERAL ADVISORY COUNCIL. 777 Federal Reserve Board for the right to subscribe to the stock of the Federal Reserve Bank organized or to be organized within the Federal Reserve district where the appli cant is located. The organization committee or the Federal Reserve Board, under such rules and regulations as it may prescribe, subject to the provisions of this section, may permit the applying bank to become a stockholder in the Federal Reserve Bank of the district in which the applying bank is located. Whenever the organization committee or the Federal Reserve Board shall permit the applying bank to become stockholder in the Federal Reserve Bank of the district, stock shall be issued and paid for under the rules and regulations in this act provided for national banks which become stockholders in Federal Reserve Banks. ' 'The organization committee or the Federal Reserve Board shall establish by-laws for the general government of its conduct in acting upon applications made by the State banks and banking associations and trust companies for stock ownership in Federal Reserve Banks. Such by-laws shall require applying banks not organized under Federal law to comply with the reserve and capital requirements and to submit to the examination and regulations prescribed by the organization committee or by the Federal Reserve Board. "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. "Any bank becoming a member of a Federal Reserve Bank under the provisions of this section shall, in addition to the regulations and restrictions hereinbefore pro vided, be required to conform to the provisions of law imposed on the national banks respecting the limitation of liability which may be incurred by any person, firm, or corporation to such banks, the prohibition against making purchase of or loans on stock of such banks, and the withdrawal or impairment of capital, or the payment of unearned dividends, and to such rules and regulations as the Federal Reserve Board may, in pursuance thereof, prescribe. "Such banks, and the officers, agents, and employees thereof, shall also be subject to the provisions of and to the penalties prescribed by sections fifty-one hundred and ninety-eight, fifty-two hundred, fifty-two hundred and one, and fifty-two hundred and eight, and fifty-two hundred and nine of the Revised Statutes. The member banks shall also be required to make reports of the conditions and of the payments of dividends to the comptroller, as provided in sections fifty-two hundred and eleven and fifty-two hundred and twelve of the Revised Statutes, and shall be subject to the penalties prescribed by section fifty-two hundred and thirteen for the failure to make such report. "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, it shall be within the power of the said board, after hearing, to require such bank to surrender its stock in the Federal Reserve Bank; upon such surrender the Federal Reserve Bank shall pay the cash-paid subscriptions to the said stock with interest at the rate of one-half of one per centum per month, computed from the last dividend, if earned, not to exceed the book value thereof, less any liability to said Federal Reserve Bank, except the subscription liability not previously called, which shall be canceled, and said Federal Reserve Bank shall, upon notice from the Federal Reserve Board, be required to suspend said bank from further privileges of member ship, and shall within thirty days of such notice cancel and retire its stock and pay ments therefor in the manner herein provided. The Federal Reserve Board may restore membership upon due proof of compliance with the conditions imposed by this section. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

778 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. such reserve deposits so kept in such State bank or trust company shall be construed, within the meaning of this section, as if they were reserve deposits in a national bank in a reserve or central reserve city for a period of three years after the Secretary of the Treasury shall have officially announced the establishment of a Federal Reserve Bank in the district in which such State bank or trust company is situated. Except as thus provided, ho member bank shall keep on deposit with any nonmember bank a sum in excess of ten per centum of its own paid-up capital and surplus. No member bank shall act as the medium or agent of a nonmember bank in applying for or receiving discounts from a Federal Reserve Bank under the provisions of this act except by permission of the Federal Reserve Board. ''Section 21. The Comptroller of the Currency, with the approval of the Secretary of the Treasury, shall appoint examiners, who shall examine every member bank at least twice in each calendar year, and oftener if considered necessary: "Provided, however, That the Federal Reserve Board may authorize examination by the State authorities to be accepted in the case of State banks and trust companies and may at any time direct the holding of a special examination of State banks or trust companies that are stockholders in any Federal Reserve Bank." BANKS ELIGIBLE TO MEMBERSHIP. A State bank or a trust company to be eligible for membership in the Federal Reserve System must comply with the following conditions: (1) It must have been incorporated under a special or general law of the State in which it is located or of the United States (District of Columbia). (2) It must have an unimpaired capital stock as follows: In cities or towns of less than 3,000 inhabitants, $25,000. In cities or towns of more than 3,000 but less than 6,000 inhabitants, $50,000. In cities of more than 50,000 inhabitants, $200,000. (3) They must agree to comply specifically with the requirements of the provisions of sections 9, 19, and 21, of the Federal Reserve Act. APPLICATION FOR MEMBERSHIP. Every State bank or trust company which shall desire to become a member of the Federal Reserve system shall make application on Form to the Federal Re serve agent of its district for an amount of capital stock in the Federal Reserve Bank of such district equal to six per, centum of the unimpaired capital stock and surplus of such State bank or trust company. Such application shall state that it is made in accordance with a vote of its board of directors, and shall be accompanied by a state ment of the conditions of the applying bank certified by an examiner to be approved or designated by the Federal Reserve Board. Upon receiving the aforesaid application and statement from any State bank or trust company within its district, the Federal Reserve agent shall submit the same to the counsel of such Federal Reserve Bank, who shall certify that in his opinion membership in the Federal Reserve system is not in contravention of the laws of the State or district in which the said bank or trust company shall be located. The appli cation and certificate of counsel shall thereupon be submitted to a committee of not less than three members of the board of directors of the Federal Reserve Bank. The said committee shall examine the application, and if it shall find that the applying bank has complied with the provisions of this regulation, and is in compliance with the State laws, it shall transmit the same to the Federal Reserve Board with its recom mendations. APPROVAL OF APPLICATION. In passing upon applications of State banks and trust companies for membership in the Federal Reserve system the following considerations will be taken into account: (1) Whether the assets of the applying bank or trust company are of such a nature Digitized foars F tRo AeSnEtiRtle it to be considered a commercial banking institution in a. Virmiri n^Am— http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

RECOMMENDATIONS OF THE FEDERAL ADVISORY COUNCIL. 779 (2) Whether the charter provisions and the nature of the powers exercised by the said bank or trust company are or are not consistent with the proper conduct of the business of commercial banking. (3) Whether or not the statutes of the State or district in which the applying bank or trust company is located do or do not contain provisions likely to interfere with the proper regulation and supervision of member banks. Whenever in the judgment of the Federal Reserve Board an applying bank or trust company fully complies with the requirements thus indicated, the said board will issue a certificate of approval of the application, and thereupon the applying bank shall subscribe and pay in its capital stock to the Federal Reserve Bank of the district in accordance with the conditions provided for member banks. POWERS AND RESTRICTIONS. Every State bank or trust company which shall be admitted to membership in the Federal Reserve system shall conform to the following requirements: (1) It shall observe all those requirements of the law to which State banks and trust companies which have become member banks are subject. (2) It shall conform to at least as high a standard of commercial banking as con trolled it at the time of its admission to the system, with 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 the admission. (3) It shall not engage in loans on real estate or mortgages of a character or to an extent which will impair its liquid condition, and it shall carry in its investments liquid loans eligible for rediscount with the Federal Reserve Bank to an amount not less than its paid-in capital and surplus. (4) If in any case such an applying institution has loans secured by its own stocks or loans to one person, firm, or corporation aggregating more than ten per cent of its capital and surplus, it shall adjust such loans to conform with the requirements of the national bank act, the same to be done within a reasonable time to be determined by the Federal Reserve Board. Except as herein specifically provided,"every State bank or trust company becoming a member of the Federal Reserve system shall continue to retain its full right as a State bank and shall be entitled to exercise all functions permitted by its charter. Any State bank or trust company which is a member shall have the right of with drawal, and may withdraw by giving ninety days' written notice of its intention so to do to the Federal Reserve Bank of the district in which said bank or trust company is located. At the expiration of said ninety days, such member shall surrender all of its holdings of capital stock and it shall be released from its stock subscriptions not previously called. Such shares shall be canceled and the member shall receive therefor a sum equal to its cash paid subscriptions on the shares surrendered, and one-half of one per centum a month from the period of the last dividend, not to exceed book value thereof, less any liability of such member to the Federal Reserve Bank; said payments to be made twenty-five per centum (25%) on the expiration of the ninety days' written notice aforesaid, twenty-five per centum (25%) in ninety days, twenty-five per centum (25%) in one hundred and eighty days, and twenty-five per centum (25 %) in two hundred and seventy days after the said first payment; provided, however, that the said Federal Reserve Bank may have the right and option to make the entire payment at any time after the surrender of such stock; provided, further, that no Federal Reserve Bank shall be required, in dealing with the voluntary with drawal of State banks and trust companies, to cancel any stock offered for the pur pose of effecting a voluntary withdrawal if such Federal Reserve Bank has previously canceled within the same year ten per centum of its capital stock under the provision of this regulation. Applications for the voluntary withdrawal shall be dealt with Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

780 ANNUAL REPORT OF THE FEDERAL, RESERVE BOARD. consecutively in the order as they shall be filed. In the case of such voluntary with drawal of a member bank the reserve balance .kept by it under the provisions of law with its Federal Reserve Bank shall be transferred to the said liquidation account and shall be paid off in the same proportions and at the same dates as the repayments of balances due on liquidation account with respect .to capital stock. EXAMINATIONS. In the matter of examinations of State banks the Federal Reserve Board expects to cooperate with State authorities in making their examinations and avoid, if possible, duplication of this work. It is proposed to accept the examinations made by States wherever these are found to be thorough and complete and of the same standard as the national bank examination or else to appoint a representative of the board or of the Reserve Bank of the district to act with the State examination staff, and in that way enable the board to accept with confidence the report of the State examiners. FUTURE REGULATIONS. The Federal Reserve Board reserves the right to make such amendments and adopt and publish, from time to time, such further regulations as it may deem necessary. CHARLES S. HAMLIN, Governor. H. PARKER WILLIS, Secretary. (Not to be released.) Recommendation— CHICAGO, May 21, 1915. Hon. F. A. DELANO, Vice Governor, Federal Reserve Board, Washington, D. 0. DEAR MR. DELANO: Referring to your letter again of 7th inst., I have now heard from the different members of the Federal Advisory Council in regard to the draft of a circular on the subject of the admission of the State banks and respectfully submit for the con sideration of the Federal Reserve Board the following suggestions: In connection with application for membership it is suggested that such application along with certificates of counsel should be sub mitted to the executive committees of the banks instead of the committees of not less than three directors. The governors of the banks being ex officio chairmen of the executive committees ought to be parties to the negotiations. Referring to clause three, " Powers and restrictions/' it is sug gested that instead of requiring State bank members to carry among their investments liquid loans eligible for rediscount with the Federal Reserve Bank to an amount not less than their paid-in capital and surplus, it would be better to require that a certain percentage of their demand deposits should be invested in such eligible paper, somewhere from 25 per cent to 50 per cent. It is also suggested that a more definite limitation to the real estate loans made by State banks should be established and that that limitation should also be related to the amount of their deposits by a definitely fixed percentage not exceeding 25 per cent. Referring to paragraph 4 under "Powers and restrictions," it is suggested that in lieu of the payments to be made to retiring banks Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

KECOMMENDATIONS OF THE FEDERAL ADVISORY COUNCIL. 781 extending over a period of one year, only a certain amount of capital shall be retired in any six months' period, somewhat along the lines provided by the National Bank Act for the retirement of national bank circulation. Under such an arrangement only a certain num ber of banks whose capital would aggregate the amount fixed could withdraw during each six months7 period. Whenever the combined capital of banks applying to withdraw aggregates the amount so fixed the applications of banks for withdrawal subsequently received would have to be postponed until the following six months' period. The idea is that under the provision proposed in your tentative circular the reserve deposits of retiring banks are to be put into a liquidation account along with their capital and are only to be paid out at fixed periods extending over a year. It might be a serious matter to a State bank to have so large a part of its reserve tied up for so long a time. State banks would probably prefer to have action on their applications to withdraw postponed and remain members until they could withdraw their capital and reserve deposits within a shorter period of time after their withdrawal had become effective. Mr. Seay, of Richmond, has gone into the matter much more elab orately than any other member of the council, and I respectfully beg to inclose herewith a copy of his letter along with his suggestions in connection with your proposed circular. Very truly, yours, JAMES B. FORGAN, President. Recommendations of the Federal Advisory Council to the Federal Reserve Board September 21, 1915. TOPIC NO. l. Question of a larger differential in rates for trade acceptances to be extended to all maturities. Recommendation.—It is the opinion of this council that a larger differential in rates for trade acceptances to be extended to all maturities is not advisable. TOPIC NO. 2. Special Rates for "Commodity Paper." Recommendation.—We do not approve of granting special rates for "Commodity paper/' TOPIC NO. 3. Suggestions and recommendations as to the probable course to be taken in the coming months with reference to discount rates at Federal Reserve Banks. Recommendation.—In our opinion suggestions and recommendations as to the discount rates at Federal Reserve Banks should be initiated by the directors of these banks as provided in the Federal Reserve Act, Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

782 ANNUAL REPORT OF THE FEDERAL, RESERVE BOARD. TOPIC NO. 4. What steps can and should be taken to encourage the entrance of State banks to the Federal Reserve System? Recommendation.—The terms already provided under which State banks may become members of the Federal Reserve System appear to be fair and liberal and we have no further suggestions to make at this time. TOPIC NO. 5. To what extent should the officers of the Federal Reserve Banks have access to National bank examiners' reports? Recommendation.—In the opinion of this council the arrangement made by the Comptroller of the Currency as indicated in his circular letter of August 23, 1915, to the chief national bank examiners pro vides for the situation as it exists at present. TREASURY DEPARTMENT, Washington, August 28,1915. To the CHIEF NATIONAL BANK EXAMINERS: Pending the determination by this office of the matter of the extent of information drawn from reports of national-bank examiners to be submitted regularly to the Federal Reserve Banks or Federal Reserve agents, you are hereby authorized and directed to supply to the Federal Reserve agents of your respective districts the information called for on the form submitted by the committee of chief examiners in their report dated July 16, 1915, copy of which is inclosed. Furthermore, you are hereby authorized, until further advised, to permit .the Fed eral Reserve agent, or the governor of the Federal Reserve Bank, or the auditor or credit man of the Federal Reserve Bank, to inspect, in your office, the report of any national-bank examiner on any national bank, in those cases where you may be advised by the Federal Reserve agent that the Federal Reserve Bank is extending credit in the form of rediscounts, or has been asked to extend credit in the form of rediscounts, to the member bank whose report the Federal Reserve Bank may thus desire to examine. In all cases where the Federal Reserve agent, or the Federal Reserve Bank, asks permission to see the report of a national-bank examiner regarding any member bank to which the Federal Reserve Bank is not extending credit, and has not been asked to extend credit, you will please refer promptly, to this office, by mail (or by wire if requested to do so by the Federal Reserve agent), the application of the said Federal Reserve Bank for permission to see the report of the national-bank examiner, together with the reasons assigned by the Federal Reserve agent for desiring to see said report, and the application will receive prompt attention. You are furthermore authorized to give the Federal Reserve agents of your respective districts, in confidence, a list of all national banks now on the "special list," or which may hereafter be placed upon the "special list," until further advised. You are hereby directed to arrange so that some competent and responsible person shall be at your office during business hours each day prepared to supply to the Fed eral Reserve Bank, upon request, the information which you are by this letter author ized to furnish to the Federal Reserve agent or the Federal Reserve Bank. Respectfully, JNO. SKELTON WILLIAMS, Comptroller of the Currency. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

KECOMMENDATIONS OF THE FEDERAL ADVISORY COUNCIL. 783 TOPIC NO. 6. The establishment of joint foreign agencies by Federal Reserve Banks. To what extent are such agencies thought likely to be of value in meeting the financial requirements of trade between the United States and South America? Recommendation.—In our opinion it is not advisable at this time for the Federal Reserve Banks to establish joint agencies in foreign countries. As the custodians of the reserves of the member banks, their resources should be kept for the protection of the member banks and not become involved in the financial or trade transactions in foreign countries. The financing of foreign trade transactions belongs legitimately to the member banks, State banks, and private bankers and should not be a function of the Federal Reserve Banks. TOPIC NO. 7. Should the national-bank act be amended so as to permit joint ownership by national banks of foreign branches? Recommendation.—In the opinion of this council the nationalbank act should be amended so as to permit joint ownership by national banks of foreign branches. TOPIC NO. 8. Liberalization of the national-bank act with a view of putting national banks more nearly on a footing of equality with State banks. Recommendation.—The national-bank act should be amended so as to permit of the establishment of branches by national banks having an unimpaired capital and surplus of not less than $1,000,000 in central reserve and reserve cities, provided that no branches are placed outside of the limits of the city where the head office of the parent bank is located. Amend the Clayton Act making an officer or director of a national bank eligible as a director in one State bank or trust company and a private banker eligible as a director in one national bank and a State bank or trust company. TOPIC NO. 9. Should intra-district clearings be made mandatory ? Recommendation.—The council's answer to this question is "No." TOPIC NO. 10. Policy to be followed by Federal Reserve Board in establishing rates at which Fed eral Reserve Banks shall be permitted or required to rediscount for one another. Recommendation.—The views of the council on this question were expressed in the President's letter to Mr. F. A. Delano, vice governor of the Federal Reserve Board, dated March 7, 1915, which views we reaffirm. NOTE.—In connection with recommendation No. 2, Mr. Seay requested to be recorded as voting against the opinion expressed by Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

784 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. the council; and in connection with recommendation No. 9, Mr, Wells requested that he be excused from voting. During consideration of topic No. 10, Mr. Forgan asked Mr. Rue to take the chair, as he desired to arrange with Governor Hamlin for a joint meeting with the Federal Reserve Board. On Mr. Forgan's return he brought with him Mr. John Skelton Williams, the Comp troller of the Currency, whose views the council desired to ascertain in connection with topic No. 5. Mr. Williams furnished the council with his circular addressed to the chief national bank examiners, dated August 23, 1915, which was read to the meeting. The comp troller then expressed his views on the subject and withdrew, where upon the council adopted the recommendation (No. 5) as above recorded. The following members of the Federal Advisory Council were present at this meeting: President, James B. Forgan, in the chair; vice president, L. L. Rue; D. G. Wing, W. S. Rowe, George J. Seay, Charles A. Lyerly, Rolla Wells, C. T. Jaffray, J. Howard Ardrey, Archibald Kains, and Merritt H. Grim, secretary. Recommendations of the Federal Advisory Council to the Federal Reserve Board contained in President's letter to Charles S. Hamlin, Governor of the Federal Reserve Board, dated November 2, 1915. (Reported to Federal Advisory Council, November 16,1915.) CHICAGO, NOV. #, 1915. Hon. CHARLES S. HAMLIN, Governor Federal Reserve Board, Washington, D. C. DEAR GOVERNOR HAMLIN : I now beg to inclose copies of the let ters I have so far received from the members of the Federal Advisory Council giving their individual views as to the advisability of fur nishing each bank when examined with a copy of the national bank examiner's report on it. • A perusal of these communications will show a unanimity of opinion in favoring of furnishing banks with a copy of the examiner's report for the use and benefit of their officers and directors. I am heartily in accord with this opinion. Some slight variance of opinion is expressed as to whether the banks should be furnished with complete copies of the examiners' reports as made to the comptroller, including criticisms of the management, reports on the personal habits of the officers, on any infractions of the law, or on other irregularities. Such matters are, of course, an ultra-confidential nature and require either delicate handling for their correction or legal prosecution for the punishment of the guilty parties. They might well be sub mitted to the comptroller for action in his discretion. They would in all probability, however, form the most important part of the Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

BECOMMESTDATIONS OF THE FEDERAL ADVISORY COUNCIL. 785 examiners7 reports, as they would disclose the vital matters demanding for their correction the immediate attention of the directors. If the banks are to reap the full benefit of the examinations such matters should be promptly brought to the attention of the directors and the question is as to how this can be done most effectively. It would seem to me that the examiners should be required, as I believe they are now required, to report promptly to the comptroller any penal infractions of the law. Any irregularities discovered on the books or in the habits or practices of any of the officers should also be reported. The comptroller would then be in a position to take such matters up with the directors through the president or in such other effective way as his discretion might dictate. All this could be done through correspondence with the comptroller outside of the examiner's regular report, the important thing being that such matters should under no circumstances be ignored, but it would seem better that the comptroller should take them up directly with the management of the bank involved rather than that the bank should get its information in regard to them through the examiners. Very truly, yours, JAS. B. FORGAN, President. Recommendations of the Federal Advisory Council to the Federal Reserve Board, November 16, 1915. TOPIC NO. 1. Assuming that only a very small number of amendments to the Federal Reserve Act or the National Banking Act can be suggested at this session of Congress— say three to five at the most—what amendments, if any, do the Advisory Council consider the most vital and important ? Recommendation.—The Federal Advisory Council would suggest the following amendments to the Federal Reserve Act without refer ence to their relative importance: Number 1.—We would recommend that the functions of the office of the Comptroller of the Currency should be absorbed and adminis tered by the Federal Reserve Board. This would remove one of the principal reasons why the State banks object to joining the system, viz, the multiplicity of supervision which should be reduced to that of the Federal Reserve Board and the State banking departments under which the State banks are organ ized. The department of examination should be operated under the direction of the Federal Reserve Board. Number 2.—Federal Reserve agents should be authorized to issue Federal Reserve notes to the Federal Reserve Banks against deposits of gold coin or gold certificates and Federal Reserve notes should 100823°—19 50 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

786 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. be made available as reserve money in the vaults of member banks. The cost of printing Federal Reserve notes should be borne by the Government. (See answer to Topic No. 3.) (The vote of the council was 6 to 3 in favor of this recommendation, Messrs. Wing, Ardrey, and It owe voting in the negative.) Number 3.—For that part of section 24 of the Federal Reserve Act relating to loans on farm lands, reading as follows: Any national banking association not situated in a central reserve city may make loans secured by improved and unencumbered farm land situated within Federal Reserve district— there should be substituted the following: 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 in an adjoining district, provided the land on which the loan is made is within one hundred miles from the office of the bank making- the loan. Number 4-—We would suggest a reduction by two-thirds of the present paid-in capital of the Federal Reserve Banks, leaving the subscribed capital and the double liability thereon to stand as it is. (The vote of the council was 6 to 3 in favor of this question, Messrs. Wing, Ardrey, and Rowe voting in the negative.) Number 5,—The council reiterates its recommendation that the Federal Reserve Board should recommend to Congress an amend ment to the Federal antitrust act so that the second paragraph of section 8 shall read as follows: No bank, banking association, or trust company, organized or operating under the laws of the United States in any city or incorporated town or village of more than two hundred thousand inhabitants, as shown by the last preceding decennial census of the United States, shall have as a director or other officer or employee any person who may be connected in either of these official capacities with more than one other bank, bank ing association, or trust company located in the same place: Provided, That nothing in this section shall apply to mutual savings banks not having a capital stock repre sented by shares: Provided further, That a director or other officer or employee of such bank, banking association, or trust company may besides being an officer or director in one other banh be a director or other officer or employee of not more than one addi tional bank or trust company organized under the laws of the United States or any State where the entire capital stock of the one is owned by stockholders in the other; and Provided further, That nothing contained in this section shall forbid a director of Class A of a Federal Reserve Bank, as defined in the Federal Reserve Act, from being an officer or director or both an officer and director in one member bank. Number 6.—The council would recommend that the law should be amended so as to permit joint stock ownership by national banks of banks organized to do business in foreign countries through branches established therein. Number 7.—The council would recommend that the national bank act should bp amended so as to permit the establishment by national banks having an unimpaired capital of not less than $1,000,000 of Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

RECOMMENDATIONS OF THE FEDERAL ADVISORY COUNCIL. 787 branches, provided that no branches are placed outside of the limits of the city where the parent bank is located. Number 8.—On motion of Mr. George J. Seay, the following reso lution was passed: That this council is unalterably opposed to any provision whereby farm loan bonds described in the Hollis bill may become security for loans from Federal Reserve Banks and to their being made a basis for acceptances by member banks. Motion was seconded by Mr. Ardrey and unanimously carried. Number 9.—Mr. George J. Seay's argument in favor of putting into immediate operation the complete reserve provisions of the Federal Reserve Act, the consideration of which was postponed from last meeting, was then considered. Mr, Daniel G. Wing moved the adoption of the following resolution: That the council believes that the Federal Reserve Board should take no action on this matter at the present time. Motion seconded by Mr. E. F. Swinney and carried by vote of 6 to 3. TOPIC NO. 2. Is it desirable that the Federal Reserve Board or the Federal Reserve Banks should take some special precautions—and if so, what precautions—to guard against a possible serious reaction in business which may come when the European war is over? Recommendation.—It is useless to attempt to prognosticate as to the business conditions that may prevail in this country after the European war is over. During the period of reconstruction in Europe it is not unlikely that a broad demand may exist for our exportable surplus of cotton, steel, copper, lumber, grain, provisions and manu factured merchandise. This would cause general activity in business, especially in the basic lines of agriculture, mining, and lumbering, which in turn would stimulate the business of our railroads and make an active demand for money. On the other hand, the terrible de struction of property, the waste of capital, and the enormous increase of public debts by the belligerent European countries may so seriously cripple them as to prevent them for some time from entering into the work of reconstruction. Their financial situation may become so bad as to seriously affect the condition of the rest of the world. It is quite possible that reaction from the business activity created in this country by the demand for war supplies may take place. The future is forebodingly uncertain and whether after the war we are to face business expansion or business contraction, a condition of pre paredness by the Federal Reserve Banks will be the part of wisdom. We would, therefore, advise that the Federal Reserve Banks should be induced and encouraged by the Federal Reserve Board to keep themselves strong in reserves and liquid in investments. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

788 ANNUAL, REPORT OF THE FEDERAL RESERVE BOARD. TOPIC NO. 3. Is it desirable to have Federal Reserve Notes in denominations of five to twenty dollars take the place of gold certificates carried in the pockets of the people? Is not the accumulation of gold by Federal Reserve Banks by the substitution of this circulation, a valuable protection in case of gold withdrawals; and is not this pro* cedure advisable in spite of the considerable expense involved? Recommendation,—The accumulation of gold in the Federal Reserve Banks would in our opinion be a valuable protection in case of gold withdrawals. We therefore deem it most desirable that gold should be accumulated in the Federal Reserve Banks in large volume and that Federal Reserve notes in denominations of five to twenty dollars should take the place of gold certificates carried in the pockets of the people. To this end the Federal Reserve Act should be amended so as to enable the Federal Reserve Banks to take out Federal Reserve notes against the deposit of gold with the Federal Reserve agent, with the object in view of having the Federal Reserve notes ulti mately take the place of the Government gold certificates in general circulation. To accomplish this they should be made available for the legal reserves of member banks. The expense of furnishing Federal Reserve notes for general circu lation should be paid by the Government, the same as it now pays the expenses of furnishing gold certificates. Federal Reserve notes are Government obligations, the same as are the gold certificates. There is no possible profit to the Government in the circulation of gold certificates, other than that on notes destroyed, while through its interest in the earnings of the Federal Reserve Banks—its circu lating agents—its profit on the circulation of the Federal Reserve notes will, ultimately, be largely in excess of the cost of furnishing them, besides which it will have the profit connected with their destruction. The Government will thus be the ultimate gainer by the substitution of its Federal Reserve notes for its gold certificates. (The vote of the council was 6 to 3 on this question, Messrs. Wing, Ardrey, and Rowe voting in the negative.) TOPIC NO. 4. Can Federal Reserve Banks do anything with their member banks to discourage or put a stop to the present high rates of interest on demand deposits? We hear that rates from three to seven per cent are common in Northwest, South, and Southwest. Recommendation.—The rate of interest on deposits paid to the public is regulated by the accumulation or lack of accumulation of wealth in the communities in which the banks do business. In small pioneer communities with little or no accumulated wealth, with a demand for money but with no local supply, the rate of interest is naturally high, but it is gradually reduced as the communities enlarge and accumulate wealth. It might be more of a hardship than a Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

RECOMMENDATIONS OF THE FEDERAL ADVISORY COUNCIL. 789 benefit to unduly restrict the rate of interest that a bank in a pioneer community can either pay or receive. The economic law of supply and demand, with State laws against usury, will sufficiently regulate rates and protect the borrower. As to rates paid on savings deposits, the savers should be en couraged. Their deposits form the foundation of the business and credit structure of the country. Bank depositors outnumber bank borrowers twenty to one and the majority of them are wage earners, small dealers, and people not engaged in business for themselves, while the borrowers are often our richest people engaged in business enterprises, who borrow to make more money. Every effort should therefore be made to maintain through the country such rates of interest on savings deposits as will induce and encourage the people in saving and thrift. We do not believe that there is anything that the Federal Reserve Banks should or could do to regulate rates of interest paid on deposits by their member banks beyond offering them, as they now do, the privilege of rediscounting at such reason able rates as are likely to reduce the current rates for loans in convmunities having little or no accumulated wealth, which will in turn reduce the rates paid in such communities on deposits. Such matters in time work themselves out naturally, and it is difficult, if not impossible, to regulate them artificially. ADDITIONAL TOPIC SUGGESTED BY MR. P. M. WARBURG, What officers of Federal Reserve Banks should have access to statements of assets and liabilities made by private bankers whose acceptances may be purchased by the Federal Reserve Banks? Recommendation.—The council has not changed its opinion for merly given to the Federal Reserve Board to the effect that such acceptances should only be purchased by Federal Reserve Banks when they are indorsed by member banks. The council is, however, of opinion that statements made by private bankers as to their affairs for the purpose of establishing their credit and to secure the handling of their acceptances by the Federal Reserve Banks may by regulation of the board be placed in the custody of the governors of the Federal Reserve Banks, and that only the governors and Federal Reserve agents of the banks should have access to them. The following members of the Federal Advisory Council were present at this meeting: President, James B. Forgan; D. G. Wing, W. S. Rowe, George J. Seay, Charles A. Lyerly, C. T. Jaffray, E. F. Swinney, J Howard Ardrey, Archibald Kains, and Merritt H, Grim, secretary. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

RECOMMENDATIONS OF THE FEDERAL ADVISORY COUNCIL TO THE FEDERAL RESERVE BOARD FOR THE YEAR 1916. Recommendations of the Federal Advisory Council to the Federal Reserve Board, February 15, 1916. TOPIC NO. 1. The Federal Reserve Board's Discount Policy. In considering this subject we would like to have the Council address itself particularly to the phase of the subject as to how the discount policy can be handled to bring about a contraction of loans by the banks of the country. A great deal has been said on the subject of the Federal Reserve Board's duty in bringing about contraction of credit at this time, mnd so discourage inflation, but no concrete suggestion has been offered as to how this should or could be effected. Recommendation.—The large amount of lawful money released by the reduction in the legal reserve requirements of the national banks, which became effective with the inception of the Federal reserve system, followed by the accumulation of gold resulting from the balance of trade turning so largely in favor of this country has formed the basis, the cause and the incentive for the large expansion of loans that has taken place among the banks of the country. By maintaining the rediscount rates of the Federal Reserve Banks higher than the current open market rates for commercial paper the Federal Reserve Board has done all in its power to prevent the facilities of the Federal Reserve Banks being used to help along this expansion, except through their open market transactions. It is difficult to see how the Federal Reserve Board can do anything practi cal to bring about a contraction of credit as long as the banks of the country continue to carry idle a large surplus of reserve money. When this surplus is absorbed a change may be expected and the Federal Reserve Banks will probably be called upon to rediscount more or less freely the lines of commercial paper which the member banks are now buying on the open market at low and unprofitable rates simply to keep their funds employed. The influence of the Federal Reserve Board can then be used to advantage. By main taining the present rediscount rates or if necessary by raising them the Board will be able to prevent still further expansion and the member banks will be induced to raise their rates which will tend to check expansion and to reestablish normal money market conditions. 790 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

RECOMMENDATIONS OF THE FEDERAL ADVISORY COUNCIL. 791 Until such time comes and these conditions prevail we know of no practical way in which the Federal Reserve Board can bring about a contraction of loans by the banks of the country. We submit herewith marked Exhibit "A" a statement showing in millions the increase in the principal items of the resources and liabili ties of the national banks between December 31, 1914, and November 10, 1915, taken from their consolidated statements as prepared by the Comptroller of the Currency. This statement shows the total excess reserves of the national banks to have been $891,000,000 on Novem ber 10, 1915. TOPIC NO. 2. Section 11 of the Federal Reserve Act gives the Board power, "To add to the number of cities classified as reserve and central reserve cities," etc. Urider this authority, the Federal Reserve Board could name the city in which each Federal Reserve Bank is located as a central reserve city. The immediate effect would be to increase the reserves of those cities from fifteen to eighteen per cent and at the same time cause a transfer of reserves in those cities to the Federal Reserve Banks, both of which objects are desirable, and more easily accomplished at a period of easy money and excess reserves. The Federal Reserve Board would be glad to have a recommendation from the Council on this subject. Recommendation.—In accordance with the requirements of the Federal Reserve Act reserve deposits of all member banks must ulti mately be kept with the Federal Reserve Banks. Thereafter balances carried with the national banks in reserve and central reserve cities will no longer count as legal reserves. When these conditions of the act have been complied with the banks located in cities so designated can no longer perform the functions of legal reserve agents and the terms "reserve city " and "central reserve city " will lose their present significance. The object of requiring reserve and central reserve city banks to carry larger legal reserves than banks located in other cities and towns has been for the better protection of the reserve deposits of the banks for which they have acted as legal reserve agents. When they cease to act in this capacity the chief reason for their carrying larger reserves than banks located in other cities will be eliminated. We know of no good reason why banks located in the same cities with the Federal Reserve Banks should, in consequence of that fact, be placed on the increased basis required of central reserve cities in the matter of their legal reserves. After all the reserve deposits of the member banks have been turned into the Federal Reserve Banks the terms "reserve city" and "central reserve city" as now applied will become misnomers. It may then become desirable to designate the twelve cities in which the Federal Reserve Banks are located as the reserve cities for the country, but Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

792 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. there will be no reason why their member banks should carry larger reserves than are required of those in the cities now known as reserve cities. The probabilities are that many of the cities now acting as reserve cities when the member banks in them cease to act as legal reserve agents will seek to have their designation as such canceled in order to avail themselves of the lower reserve requirements applicable to other cities, some of which will then be similarly situated to them. Before we received the analysis of the reserve city situation fur nished by the Federal Reserve Board we had had prepared for us a list of the present reserve cities, of which there are 56 including the three central reserve cities. As our list in addition to giving the population of these cities also shows their banking power as measured by the capitalization of their banks both National and State and as reserve deposits of State banks carried by the National banks in these cities will have some bearing on the legal reserve which they should be required to carry we submit the list herewith as Exhibit B.1 Ac companying this list there is also a list of cities of approximately equal population and banking capacity which are not now reserve cities and of which there are ninety. This list also shows their bank ing power as measured by the capitalization of their banks. In our opinion when the banks in reserve cities lose their privilege of acting as legal reserve agents they should be placed on a parity as to their legal reserve requirements with the banks in other cities of equal banking capacity. These cities were designated reserve cities at the request and by the voluntary action of the national banks located in them and when their privilege of acting as reserve agents is withdrawn, it would seem that these banks should be entitled to resume their former status. If there is to be in the future any discrimination in regard to the legal reserve carried by the banks in different cities, it can not continue to be based as it has been on the fact that banks in certain cities have been permitted to act as legal reserve agents for other banks. If such discrimination is necessary or desirable at all it might be based on a combination of their indi vidual population and banking capacity as shown by the capitalization of their banks or it might be related to the aggregate amount of bank deposits carried by the banks in them. In order to show the lack of uniformity in the legal reserve require ments of the State banks in the different States we have had prepared and submit herewith a synopsis of most of the State laws on the subject. Exhibit C.1 The fact that member banks in these so-called reserve cities have to compete with nonmember banks not subject to Federal regulations in regard to their legal reserve requirements should not be overlooked. i Not printed. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

RECOMMENDATIONS OF THE FEDERAL ADVISORY COUNCIL. 793 TOPIC NO. 3. Can the Federal Advisory Council offer any suggestion in the direction of facilitating the provisions of the act in respect to carrying out clearing operations? The Federal Reserve Board has felt that the subject of clearing was intimately con nected with the question of reserves and that it was probably best not to press the matter or insist on any mandatory rule until the reserve should have been paid in. It is evident, however, that before the year of 1916 is over the proportion of reserves withdrawn from other depositaries and paid into the reserve banks will be so con siderable that the demands on the reserve banks to take care of the collection not only of checks but of many other items, will be insisted upon by member banks* Recommendation.—The collection or clearing intradistrict and interdistrict checks by the Federal Reserve Banks as contemplated by the Federal Reserve Act forms a complicated and difficult prob lem, especially so as the language of the act is not clear in regard to some of the details on the subject. We understand the executive officers of the banks have had many conferences among themselves and some with the Federal Reserve Board in an effort to develop a system that will serve the purpose contemplated by the act, that they have had a tentative intra district plan on trial for some time and that they also have a universal system now under consideration. The subject is one of vast detail in connection with which an off hand opinion given by this council, the members of which are not in touch with its details, would be of little constructive value or assist ance. We therefore hesitate to offer any suggestions and will confine ourselves to an expression of our opinion to the effect that until the Federal Reserve Banks can undertake the collection of checks on nonmember banks as well as for member banks they are not in a position to develop a check-collection system that will be economically effective in connection with the banking business of the country as a whole. In order to be economically effective a check-collection system must, it seems to us, be practically universal. All banks handle outside checks promiscuously through their transit depart ments and an organization that can only handle a part of them, and that the smaller part, can afford but little assistance economically or otherwise in connection with the handling of them. TOPIC NO. 4. At the last meeting of the advisory council, the council recommended a reduction in the proportion of capital stock which should be paid in by member banks to the Federal Reserve Banks, basing its conclusions largely upon the argument that Federal Reserve Banks ought not to be compelled to compete with member banks in periods of inflation. It is obvious that the necessity of earning dividends upon the capital of Federal Reserve Banks held by member banks may be regarded from opposite points of view. On the one hand, it may be said that if the Federal Reserve Bank is compelled to earn six per cent on a considerable capital, it will Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

794 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. market. On the other hand, it may be urged that the greater dividend the bank has to earn, the more willing it will be to have interest rates stiffly maintained. This latter, reasoning is in the mind of those who suggest that the Federal Reserve Bank should have no capital, hence no dividend requirements, so that they can offer money to their member banks at very low rates of interest, or actively com pete with member banks in the open market. Without developing this argument in extenso, it may be seen that the effect of reducing capital stock might easily be to make competition with member banks more keen, rather than less keen. It appears fairly obvious to the Board that there is probably a golden mean between the extremes of public opinion on this question, and we should be very glad to have the opinion of the advisory council, based on calculations, of the proportion of capital and reserves which should be invested, in normal times, to earn expenses and dividend requirements, and the proportion which should be held uninvested or in such liquid form as to be readily convertible into cash or credit. Recommendation.—Inasmuch as some of the membership in the Federal advisory council have changed since the last meeting, the question of a reduction in the proportion of capital stock which should be paid in by member banks to the Federal Reserve Banks was taken up again for discussion. We believe that no reduction in the present paid-in capital stock of the Federal Reserve Banks should be made at the present time for the following reasons: We beg to say that inasmuch as the deposits in Federal Reserve Banks will be largely increased in May next, with a further increase next November, that the proportion of capital to deposits will steadily diminish, that if any considerable number of State banks join the system, as is to be hoped, the proportion will be still further reduced. One of the criticisms made when the bill was before Congress was that there would be 12 units and that no one would have sufficient capital to command respect and confidence abroad. The disparity of capital between each Federal Reserve Bank and some of the larger member banks in each district is marked. It is conceivable that under the provisions of the act in regard to purchase of 2 per cent Government bonds, the Federal Reserve Banks may, in the course of a few years, have not only all of their capital invested in these bonds, but part of the reserves of member banks as well. If two-thirds of the paid-in capital be returned, a number of the banks would have more than the remaining capital in Government bonds at the end of the first year. The calling of unpaid subscriptions in times of emergency would undoubtedly be unsettling not only to the banks, but would create alarm to the country at large. Foreign banks use.d to large capital in their government and incorporated banks would regard the small capital under which the banks would be operating as a distinct sign of weakness. We do not regard the deferring of the payment of dividends as of Digitized fosru FfRfiAcSieEnRt importance to warrant such action at this time, particuhttp://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

RECOMMENDATIONS OF THE FEDERAL ADVISORY COUNCIL. 795 larly as the s\rstem is as yet in its infancy and has not been tested during a time of stress. We can not undertake to estimate the proportion of capital and reserve deposits which should be invested in normal times by the various Federal Reserve Banks to earn their expenses and dividend requirements. Such proportion would vary with the varying condi tions prevailing in the different districts and these conditions are subject to constant change. It would therefore seem impractical to attempt-to make any estimate of it. (Messrs. C. T. Jaffray, E. F. Swinney, and J. B. Forgan voted in the negative.) In connection with this topic, two reports having been made by the executive committee, Mr. Rue moved that it is the sense of this meeting that the capital of the Federal Reserve Banks should not at this time be reduced and that a committee be appointed, consisting of Mr. Wing and Mr. Rowe, to prepare a report on this subject in conformity with the views as expressed by a majority of the members present and to report at the afternoon meeting. Motion seconded by Mr. Lyerly and passed. At an adjourned meeting in the afternoon, Mr. Wing submitted a report on this topic, and on motion duly seconded it was adopted. (Mr. Swinney, Mr. Jaffray, and Mr. Forgan voting in the negative, as above indicated.) Mr. Jaffray then moved that those who voted in the minority be permitted to make a separate report to the Federal Reserve Board on this topic. Motion seconded by Mr. Swinney and carried. The minority report is as follows: TOPIC NO. 4. At the last meeting of the Advisory Council, the council recommended a reduction in the proportion of capital stock which should be paid in by member banks to the Federal Reserve Banks, basing its conclusions largely upon the argument that Federal Reserve Banks ought not to be compelled to compete with member banks in periods of inflation. It is obvious that the necessity of earning dividends upon the capital of Federal Reserve Banks held by member banks may be regarded from opposite points of view. On the one hand, it may be said that if the Federal Reserve Bank is compelled to earn six per cent on a considerable capital, it will be compelled to invest not only all its capital but a good share of its reserve deposits in rediscounts or in investments bought in the open market, and so compete with its member banks at a time when it might be wiser to stay out of the market. On the other hand, it may be urged that the greater dividend the bank has to earn the more willing it will be to have the interest rates stiffly maintained. This latter reasoning is in the mind of those who suggest that the Federal Reserve Bank should have no capital, hence no dividend requirements, so that they can offer money to their member banks at very low rates of interest, or actively compete with member banks in the open market. Without developing this argument in extenso, it may be seen that the effect of reducing capital stock might easily be to make competition with member banks more keen, rather than less keen. It appears fairly obvious to the Board that there is probably a golden mean between the extremes of public opinion on this question, and we should be very glad to have the opinion of the Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

796 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. Advisory Council based on calculations of the proportion of capital and reserves which should be invested in normal times to earn expenses and dividend require ments, and the proportion which should be held uninvested, or in such liquid form as to be readily convertible into cash or credit. Recommendation.—The capitalization of the Federal Reserve Banks is intimately related to the question of how much of their resources they should keep invested under normal conditions or during a period of abnormally easy money such as exists at present. The Federal Reserve Act provides for a 6 per cent cumulative dividend on the capital employed, and if this dividend obligation is to be met the larger the paid-in capital the larger must be the amount of investments carried and the greater will be the temptation to increase investments when money rates are low and profits correspondingly small. This dividend obligation and the temptation to meet it by adopting a policy of expansion in times of easy money when the banking and commercial interests of the country call for a policy just the reverse are the reasons for the recommendation we made at our last meeting for a reduction in the amount of paid-in capital of the Federal Reserve Banks. As a practical illustration we would call your attention to the pres ent situation in connection with the Federal Reserve Bank of Chicago. We refer to the situation there because the Chicago banks stand mid way between those banks which show substantial earnings in excess of their operating expenses during the past year and those which show expenses greater than earnings. With a capital of $6,646,000, re sources of $65,226,000, and investments averaging $12,000,000, the Chicago bank is now earning $500 a day above its operating ex penses, or about 2| per cent per annum on its present paid-in capital. Were its capital reduced to one-third of its present amount, as recommended, its earnings would be a little over 8 per cent and all temptation to further increase its investments during the present expansion and easy money market would be removed, while if its member banks continue to be liable for the full amount of their sub scriptions and double liability and these subscriptions are made pay able at the call of the Federal Reserve Board when and as they deem it necessary or desirable to increase the bank's paid-in capital, its inherent strength would not be impaired. It could then make a statement in regard to its capital as follows : Capital paid in $2,214,666 Capital subscribed by member banks payable on call of the Federal Re serve Board 11,073,334 Total capital subscribed by members 13, 288,000 Double liability of member banks 13, 288, 000 Total capital responsibility 26, 576, 000 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

KECOMMENDATIONS OF THE FEDERAL ADVISORY COUNCIL. 797 This, it seems to us, would show a sufficiently strong capitalization for all practical purposes. The bank would not only be able without further expansion to pay the 6 per cent dividend on its stock to its member banks but the Government would be in a position to realize a substantial share of the profits whenever conditions arise calling for active rediscounting by the member banks. We regard it as most undesirable that the banks should continue to roll up a liability to the member banks for unpaid dividends. Such a condition must inevitably reflect on their standing not only with the public and the banks of the country but with foreign banks. The impression will be created that the Federal Reserve Banks are a failure so far as their ability to earn dividends is concerned. We can therefore only repeat our former recommendation that the paid-in capital should be reduced to one-third of the amount that has already been called in and that the unpaid capital to the full amount of the ; member banks7 subscriptions for it should be left payable on the call of the Federal Reserve Board. We can not undertake to estimate the proportion of capital and reserve deposits which should be invested in normal times by the various Federal Reserve Banks to earn their expenses and dividend requirements. Such proportion would vary with the varying con ditions prevailing in the different districts, and these conditions are subject to constant change. It would therefore seem impractical to attempt to make any estimate of it. Were the paid-in capital reduced, as we have recommended, the banks would not have to compete un duly with member banks in normally or abnormally easy times for such purpose and the amount to be invested by each bank during such periods might safely be left to the discretion of the executive officers and directors under the guidance and supervision of the Fed eral Reserve Board. TOPIC NO. 5. At the September meeting of the council it recommended to the Federal Reserve Board that the Federal Reserve Banks should not establish joint agencies in foreign lands, but that this field should be kept open for member banks. Since that time the Federal Reserve Board has canvassed the subject through the Federal Reserve agent of each district with a view to ascertaining whether the larger banks in the various districts would be willing to join in the ownership of branches in foreign countries. The replies to these inquiries are not as encouraging as has been hoped they would be, for it appears that while for a number of good reasons it seems unwise that the Federal Reserve Banks should undertake this business, there is a great deal of hesitation on the part of most member banks to undertake it themselves. A few banks appear to show a spirit of enterprise in the matter and the Board believes that under any circumstances the door ought to be opened as wide as possible and that Congress should be urged to do all it can to offer to member banks, singly or combined, the opportunity of entering these foreign fields. In this connection some questions have occurred to the Board in considering this matter upon which it will be glad to have the views of the Advisory Council. These questions are: Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

798 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. (a) Should the proposed amendment provide that others than member banks be permitted to be stockholders in these banks which are to operate under Federal charters in foreign countries? Recommendation.—To this we would answer "Yes; under proper restrictions.'7 If so, should there be a provision that a majority of the stock be held by member banks? Recommendation.—This we consider desirable, but it might be im practical, inasmuch as the stock would be marketable and the control might change at any time. We would, however, approve an amend ment to section 25 of the Federal Reserve Act which has been sub mitted to us and which reads as follows: Amend section 25 so as to permit national banks with a capital of not less than $1,000,000 to become stockholders in either domestic or foreign corporations chartered and licensed to do banking business in foreign countries, provided, however, that the total liability incurred by reason of said ownership of stock in foreign banks shall not exceed 10 per cent of the capital and surplus of said bank. (Vote unanimous.) (b) Would it not be advisable to provide that there should not be a double liability with respect to the stockholders in such banks, but only a liability up to the au thorized capital? Recommendation.—We see no necessity for a double liability, but only a liability up to the authorized capital. (Mr. Record voted "No.") (c) What, if any, should be the reserve requirements of these foreign banks? If they are to receive deposits in foreign countries it would subject them to great hazard of fluctuation of exchange if against these foreign deposits they are re quired to keep reserves in the United States. Recommendation.—From the published statements of foreign banks doing business in South American countries we notice that they seem to carry much larger cash reserves than are legally required of banks under our Federal Reserve system and probably American banks organized to do business there would have to do likewise. We there fore think that no regulations need be made as to reserves against deposits received in foreign countries. For any deposits they may receive in the United States they should be subject to the reserve requirements applicable to member banks under the Federal Reserve Act. (Vote unanimous.) (d) Should these foreign banks be required to be members of the Federal Reserve system? Recommendation.—We think it might be well to require that these banks should be members of the Federal Reserve system in order that they may be brought under the supervision of the Federal Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

RECOMMENDATIONS OF THE FEDERAL ADVISORY COUNCIL. 799 Reserve Board and thus become a part of the banking system of the country. It would also be advantageous to them to have the privi lege of rediscounting and otherwise doing business directly with the Federal Reserve Banks, but it might be necessary to place special restrictions on their rediscounts. (Vote unanimous.) (e) Should these foreign banks be permitted to invest a definite percentage of their capital and surplus in holdings of foreign banks operating under local charters? Recommendation.—Yes. (Mr. Forgan, Mr. Fleishhacker, Mr. Swinney, and Mr. Record voted uN"o.,;) (f) What restrictions should be placed upon these foreign banks for their operations in the United States? For instance, they might be permitted to accept deposits only where these deposits are incidental to transactions in foreign countries. On the other hand, it would appear that they should be permitted to receive de posits on demand or on time from other banks, particularly from those for which they will act as correspondents or agents in foreign countries. Recommendation.—We would recommend that in the matter of receiving deposits in the United States such banks should be re stricted to such deposits as are incidental to transactions in foreign countries. (Vote unanimous.) (g) Should these foreign banks be permitted to accept and should their " bankers' acceptances" be eligible for rediscount with the Federal Reserve Banks? Recommendation.—If their acceptances are restricted to such as "grow out of transactions involving the importation or exportation of goods" and otherwise conform to the requirements of the Federal Reserve Act we see no reason why they should not be permitted to make them or why they should not be eligible for rediscount with or purchase by the Federal Reserve Banks. (Vote unanimous.) Additional recommendation.—The question of the Comptroller's ruling in regard to banks issuing commercial letters of credit was informally discussed, it being decided to confer informally with the Federal Reserve Board at the joint conference in regard to this matter. Additional recommendation.—The attention of the Federal Advisory Council was then directed to the proposed amendment to H. R. 15657, entitled " An act to supplement existing laws against unlawful restraints and monopolies, andfor other purposes/' approved October 14, 1914. The amendment in the form of a provision to be added to the second paragraph of section 8 of said act, reads as follows: And provided further that nothing in this act shall prohibit any officer, director, or employee of any member bank, or a Class A director of a Federal Reserve Bank from being an officer, director, or employee of one or more other banks, banking associations, or trust companies, whether organized under the laws of the United Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

800 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. States, or any State, if such other bank, banking association, or trust company is not in substantial competition with such member bank. Nothing contained in this amendment shall impair the powers delegated to the Federal Reserve Board in section 11 of this act to prosecute violations of the same. On motion it was unanimously resolved that this council approves of said proposed amendment and advises the Federal Reserve Board to recommend and support the enactment into law of the said amend ment at the present session of Congress. The following members of the Federal Advisory Council were present at this meeting: President, James B. Forgan, in the chair; vice president, L. L. Rue; D. G. Wing, W. S. Rowe, J. W. Norwood, Charles A. Lyerly, C. T. Jaffray, E. F. Swinney, T. J. Record, Herbert Fleishhacker, and Merritt H. Grim, secretary. Recommendations of the Federal Advisory Council to the Federal Reserve Board, May 16, 1916. TOPIC NO. 1. Presumably members of the Advisory Council hear many criticisms of the Federal Reserve Act and of the Federal Reserve Board. To what extent have these criticisms been substantive, constructive, or suggestive, and to what extent does the Advisory Council endorse and approve them? Recommendation.—The council has heard no vital criticisms of the Federal Reserve Act beyond such as have been referred to by the Federal Reserve Board in its annual report to Congress and no criti cisms of the Board which seem worthy of discussion. TOPIC NO. 2. Should the Federal Reserve Board seek to stop the pyramiding of deposits by reason of inter bank deposits? To what extent should reserves carried against bank deposits be greater than reserves carried against individual deposits? Recommendation.—Under our system of banking it is practically impossible to prevent the pyramiding of bank deposits. Each indi vidual bank for its exchange purposes finds it necessary to keep funds at its credit in the principal centers with which its locality has direct business dealings. Quite naturally when it lacks a sufficient local demand to employ its funds it accumulates them with its corre spondents at these centers. Generally speaking these centers are the so-called reserve cities. The banks in these cities need funds for the same purpose in the larger centers now known as central reserve cities, two of which—Chicago and St. Louis—must of necessity maintain large balances in New York. In this way when money becomes re dundant, idle funds are passed along from the numerous country banks to the less numerous reserve city banks and from them to the central reserve city banks, finally reaching the banks of New York, which thus become the reservoirs for the bulk of the idle funds of the entire banking system. For some time money has been quite re- Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

RECOMMENDATIONS OF THE FEDERAL ADVISORY COUNCIL. 801 dundant over a large part of the country, and this pyramiding process has become intense, causing inflation of bank deposits at the centers with a corresponding expansion of loans and a demoralization of interest rates. Under the national banking system prior to the passage of the Federal Reserve Act the double or triple reckoning of bank deposits as legal reserves formed the greatest evil of the pyramiding process. By providing that no bank deposits other than those with the Federal Reserve Banks shall be available as legal reserves and by providing the member banks with the facilities offered by the Federal Reserve Banks for rediscounting and supplying circulation the Federal Reserve system has greatly reduced the danger of this unavoidable pyram iding process and will tend to reduce it in volume. The banks in the precent reserve and central reserve cities will undoubtedly continue to carry bank deposits after they cease to act as legal reserve agents, and for this reason doubtless they are required by the Federal Reserve Act to maintain larger legal reserves than the country banks. The expectation that they will thus continue to receive bank deposits affords the only reason for this requirement, and we believe that the 15 per cent and 18 per cent legal reserve now re spectively required of them will be found adequate under the new system. Inasmuch, however, as under the Federal Reserve system the banks in these so-called reserve cities are to lose their privilege of acting as legal reserve agents for the country banks, and as the banks in many cities which have not been designated as reserve cities accept bank deposits and offer special inducements to attract them, it would seem equitable, conservative, and proper that all banks receiving bank deposits should be required to maintain a minimum legal reserve against them of 15 per cent. TOPIC NO. 3. What is the opinion of the council as to the exceedingly low rates that prevail in the matter of bankers' acceptances? Recommendation.—The market rates for bankers' acceptances have been regulated largely by the rates current in New York on call loans and bank deposits. Prime bankers' acceptances have already come to be regarded as a new form of secondary reserve of unusual efficacy, being readily convertible into legal reserve by disposing of them to the Federal Reserve Banks. Banks having surplus balances" in New York or idle funds beyond the limited amount on which their New York correspondents will pay them 2 per cent interest have been willing to take prime bankers' acceptances maturing within ninety days at rates only fractionally above the 2 per cent paid on their bank bal ances. This is the competition met by the Federal Reserve Banks 100823°—19 51 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

802 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. in purchasing them on the open market, and explains their making a minimum rate for them of 2 per cent, which practically established that as the market rate for all acceptances coming within their legal requirements. When conditions change and money becomes less redundant, this competition will be greatly reduced if not practically eliminated, and the Federal Keserve Banks should then raise their minimum rate for them. Under normal conditions for the protection of "dollar exchange" the discount rates prevailing in the leading foreign money centers for similar acceptances payable in sterling or other foreign currencies will have to be considered in fixing the Federal Reserve Banks' discount rates on prime bankers' acceptances. The rate will be regulated by the law of supply and demand. TOPIC NO. 4. The investments of the Federal Reserve Banks have reached now the amount of $164,500,000; the percentage of cash against deposits and note liability is now about 69.8 per cent. A further installment of about $60,000,000 is due on May 16 and will some what increase this percentage. It would be interesting for the Federal Reserve Board to have the Advisory Council give its opinion as to the advisability of the Federal Reserve Board's now adopting a definite policy as to a minimum percentage of cash reserve to be maintained by Federal Reserve Banks—a percentage which of course would have to be adjusted from time to time according to conditions. If the Ad visory Council should favor the adoption of such a policy, what would be its idea as to the proper percentage to be applied under present conditions? Should there be a different percentage in the various districts? Should Federal Reserve Banks amongst each other adjust deficiencies against these reserves by redis count operations, or should the average percentage of all banks combined be considered the basis and rediscount transactions become necessary only when Federal Reserve Banks reach the limit provided by the law of 40 per cent or 35 per cent, respectively? Recommendation.—In view of the present unsettled conditions of international monetary affairs produced by the European war and the plethora of money and expansion of credit prevailing in this country due very largely to the same cause, we are of the,opinion that the Federal Reserve Banks should conserve their cash resources and run strong in their cash reserves. We are not, however, pre pared to name a definite minimum percentage of cash reserves that could be made applicable to them all. Discretion should be ex ercised in the case of each. A bank with its portfolio well filled with prime bankers' acceptances, which can be relied upon to liquidate themselves as they mature, especially when they are made avail* able as a basis for the issue of Federal Reserve notes, might legiti mately encroach upon its cash reserves to a greater extent than a bank having its portfolio filled with the ordinary run of rediscounted paper. Under present conditions the cash reserves of the Federal Reserve Banks can most readily be regulated and controlled through Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

RECOMMENDATIONS OF THE FEDERAL ADVISORY COUNCIL. 803 their open-market transactions. Should any of them through their transactions in the open market reduce their cash reserves to a point which in the judgment of the Federal Reserve Board approaches too close to the minimum legal limit, they should be required to raise their rates on such transactions, abandon them entirely or arrange with the other Federal Reserve Banks not similarly situated to relieve them of some of their bankers' acceptances, municipal war rants, or other open-market purchases. In our opinion the average percentage of cash reserves carried by all the banks combined reveals the strength of the system and com pulsory rediscounts between the Federal Reserve Banks should be resorted to only when any of them, through rediscounting for their member banks, approach too close to the limit provided by law of 40 per cent on their circulation and 35 per cent on their deposits. Additional recommendation.—In the interests of the banks of the country we would draw your attention to section 10 of the Clayton Antitrust Act, which prohibits any common carrier having any deal ings in excess of $50,000 a year without competitive bids with an other company in which a director of the common carrier is interested. The effect of this statute is that a railroad company, any of whose directors or officers are interested in a bank, can not deal with that bank in securities without competitive bidding. It might be held that borrowing money and giving notes constitute " dealings in se curities " and come within the statute. This section of the Clayton Act becomes effective October 15, 1916. The Interstate Commerce Commission has just promulgated tentative rules for competitive bidding which require a large amount of newspaper notices, permission to all bidders to see and take copies of the other bids and reports to the Interstate Commerce Commis sion. The hearing on these rules by the Interstate Commerce Com mission, originally set for to-day, has been postponed to June 19. The interests of the banks of the country are in the construction placed by these rules on the words "dealings in securities." A great many of the large banks of the country have on their boards of directors one or more persons who are directors of railroads engaged in inter state commerce and many of these banks make short-time loans to railroads in order to enable them to pay taxes, bond interest, etc. Sometimes these loans are made on plain, unsecured notes, but more often they are secured by the pledge of bonds, stock of subsidiaries, or other securities. It is obviously undesirable that such short-time loans, even when secured by the pledge of securities, should require competitive bidding with publication of tenders for bids, etc. Such short-time loans from the necessity of the case have to be made quickly and any variation in the rate of interest on them could not produce any appreciable effect on the situation of the railroad. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

804 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. Under the various State statutes requiring issues of securities to be submitted to public utility commissions, etc., there is practically always a provision to except from such submission loans for less than either one or two years. It does not seem to us that Congress in tended by the words "dealings in securities" to include short-term bank loans either secured or unsecured. We think that the words " dealings in securities " do not cover the case of a pledge of securities as collateral to a bank loan. We are therefore of the opinion that the proposed rules should ex pressly except bank loans having not more than, say, two years to run, whether or not such loans are secured by the pledge of collateral. The tentative draft of rules promulgated by the Interstate Commerce Commission in paragraph 2 by implication indicates that a bank loan secured by collateral is to be construed as within the terms of the act and possibly also by implication would include a loan on an unsecured note. The Federal Reserve Board will do a great service to the banks of the country if they will make such representations to the Inter state Commerce Commission as will induce them to modify the draft rules so as to indicate clearly that short-time bank loans whether or not secured by the pledge of collateral are not construed to be within the terms of the act and can be made without competitive bidding following advertisement. We would therefore urge that your Board take prompt action in this matter while the Interstate Commerce Commission has it under consideration. The following members of the Federal Advisory Council were pres ent at this meeting: President, James B. Forgan, in the chair; vice president L. L. Rue, D. G. Wing, J. P. Morgan, J. W. Norwood, W. S. Rowe, Charles A. Lyerly, F. O. Watts, C. T. Jaffray, T. J. Rec ord, Herbert Fleishhacker, and Merritt H. Grim, secretary. Recommendations of the Federal Advisory Council to the Federal Reserve Board, September 18, 1916. TOPIC NO. 1. The Reserve situation. Reserve conditions in the country at large and in the several districts. TOPIC NO. 2. Discount policy. Suggestions or recommendations if any for changes in discount rates to be made in the coming months. Recommendations.—Federal Reserve District No. 1. Mr. D. G. Wing: « TOPIC No. 1.—There has been no material change in reserve conditions in District No. 1.—The Boston banks show a considerable excess of reserve at the present time, some $27,000,000, and of this amount nearly $24,000,000 is excess in New York. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

RECOMMENDATIONS OF THE FEDERAL ADVISORY COUNCIL. 805 There is practically no change in the country bank situation. The New England banks are borrowing only a small amount from their Reserve Bank and a compara tively small amount from their Reserve agents. I think, however, that they are gradually increasing their holdings in foreign loans and similar securities. TOPIC NO. 2.—The Reserve Bank discount rates are about right at the present time and I see no need of any change in the near future. In the present condition of the money market changes in the Reserve Bank rate would have very little effect one way or the other. Business in this district continues very active and at gradually increasing prices. Federal Reserve District No. 2. Mr. J. P. Morgan: TOPIC NO. 1.—In general the banks in the Second District have not any very large amount of excess reserve, certain of the larger banks in New York City holding prac tically the entire excess reserve of the district, though this excess reserve can, of course, be made available as and when necessary by the shifting of loans from one bank to another. In view of the very large amount of out-of-town bank deposits in New York at present, the total excess reserve is not more than is needed to care for the situation should the out-of-town banks withdraw a substantial amount of their deposits. In my opinion, however, this phase of the situation is thoroughly under stood and the banks in general are taking very great care to keep themselves in such a liquid condition that should their deposits be withdrawn they would be able to meet all requirements. I understand that a thorough study of the reserve situation is being undertaken both by the Federal Reserve agents and by the governors of the Federal Reserve Banks, with a view to having complete data on hand for Congress to study and decide what if any changes should be made in the present existing laws in view of the fact that after November, 1917, no deposits in reserve or central reserve cities can be counted as reserve by any bank in the system. It is certainly specially desirable that this study should be made and completed as soon as possible, as it is important that if any changes in reserve requirements should be made they should be made before the final transfer of all reserves to Federal Reserve Banks. TOPIC NO. 2.—The policy at present in force appears to me to call for no change, except that I should recommend that the 10-day rate be changed to 15 days in order to most advantageously meet the new authority to member banks to borrow upon their own notes upon eligible paper for periods not exceeding 15 days. Federal Reserve District No. 3. Mr. L. L. Rue: TOPIC NO. 1.—Reserve conditions in District No. 3 are about normal. Rates for money remain comparatively low, the current rate for time collateral loans and com mercial paper being three and one-half and four per cent. Surplus reserves of clearing house banks in Philadelphia are now about 32 millions of dollars, which indicates that there is no pressure for money. TOPIC NO. 2.—We have no suggestions to make as to change in discount rates, and certainly would not undertake to name rates for the coming months. Rates must be made from time to time to meet conditions as they prevail. Very few of the member banks of this district are rediscounting at this time, the total amount being less than half a million dollars. The investment operations of the Federal Reserve Bank of Philadelphia are made up largely of purchases in the open market. Federal Reserve District No. 4. Mr. W. S. Rowe: TOPIC NO. 1.—The conditions in District No. 4 are about normal. The member banks are using their credit with the Federal Reserve Bank very lightly and the country banks are discounting but little paper with their city correspondents. There is less than the usual manufacturing and mercantile demand for credit in the district. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

806 ANNUAL BEPORT OF THE FEDERAL RESERVE BOARD. TOPIC NO. 2.—Federal Reserve Bank rates for rediscounts are in accord with present conditions. We have no suggestion to make on future rates, believing that they will be governed by the demand. General business in the district is active and is ex panding. Federal Reserve District No. 5. Mr. J. W. Norwood: TOPIC NO. 1.—It is the opinion of the management of the Federal Reserve Bank of Richmond that reserve conditions in the Fifth District are entirely satisfactory, and stronger than could have been foreseen two months ago. Reserve conditions in the country at large seem favorable. TOPIC NO. 2.—There appears to be no reason to change the discount policy of the past, and rates should be watched closely with a view to discouraging speculation and expansion. Federal Reserve District No. 6. Mr. Charles A. Lyerly: TOPIC NO 1.—Reserve conditions are above normal—that is, banks have excess reserves. Their balances with correspondents are large; of course, their balances with the Federal Reserve Banks are simply to meet the requirements of the law, for they get no interest on balances. TOPIC NO. 2.—The change of the law, allowing direct loans to the member banks at a preferential rate and the present commodity rate, with member banks' domestic acceptances which can be bought in the open market, will bring about the adjustment in rates desired. The plethora of gold will not permit of increase of rate. Federal Reserve District No. 7. Mr. James B. Forgan: TOPIC NO. 1.—Between December 31, 1914, and June 30, 1916, the net deposits of all the national banks in the country have been increased by the enormous sum of $2,033,000,000, or 30 per cent. During the same period their loans and discounts have increased $1,331,000,000, or 21 per cent, and their bond investments, other than Government bonds, have increased over $400,000,000, or about 40 per cent. During the same period their reserve required increased $316,630,000, or 33 per cent, while their total reserve increased $568,143,000, or over 37 per cent. Of the total legal reserve of the national banks, however, $842,390,000 is still in the hands of their approved reserve agents, while their total excess reserves is $801,243,000, so that $41,147,000 more than the total of their excess legal reserves is still in the hands of their approved reserve agents. After November 16,1917, when legal reserve balances can no longer be kept with present approved reserve agents and only balances in the Federal Reserve Banks and cash in vaults will count as legal reserve the present excess will suddenly disappear and the statements of the member banks in regard to their legal reserves will make a very different showing. By that time it may be anticipated that peace will prevail in Europe. At all events, when peace does again prevail, there will likely be keen international competition for gold, and we will no doubt lose a considerable part of the accumulation we have gained during the war. It therefore behooves the Federal Reserve Banks to cooperate with their member banks in maintaining strong cash reserves, especially gold reserves, and to keep the banks in a liquid condition. The most notable feature in connection with the condition of the legal reserves in District No. 7 is that the percentage of the legal reserves of the national banks in Chicago has now been reduced to practically the new minimum required under the Federal Reserve Act. It shows a reduction between May 1st and June 30th of this year from 20.76 per cent to 18.34 per cent, or 2.42 per cent. Twelve of the largest banks, members of the Chicago clearing house (six of them national and six State) showed combined legal cash reserves of only 16 per cent in their last published statements of June 30, 1916, against 18.4 per cent a year ago. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

RECOMMENDATIONS OF THE FEDERAL ADVISORY COUNCIL,. 807 The excess reserves held by all the national banks in District No. 7, outside of Chi cago, amount to $78,616,000, but $89,351,000 of their legal reserves are still in the form of balances with approved reserve agents. $10,735,000 more than their total excess of legal reserves is therefore still in this form. After November 16,1917, these balances will no longer count as legal reserve and the condition of the banks of the district in regard to their legal reserves will present a very different aspect. The banks should therefore run strong in actual cash reserves or in their balances with the Federal Reserve Bank to provide against contingencies that may arise when peace again pre vails in Europe. TOPIC NO. 2.—So far as can be seen at present, there is nothing pending in the Sev enth District calling for any change in the Federal Reserve Bank's rates. It present rates for short maturities are in accord with current market rates for money, while for longer maturities they have been slightly above the rates charged by the Chicago banks when rediscounting for country banks. Comparatively little rediscounting has been done in the district and so far very little use has been made of the low rates offered for short maturities. The reserve of the member banks in Chicago, as shown by their last published statements, being practically down to their limit, it is not improbable that as the fall season advances and the movement of money becomes more active there may be an increased demand for rediscounts on the Federal Reserve Bank of the district, but unless the demand should prove to be much greater than can at present be anticipated, there will be no occasion for any change in the discount rates during the balance of this year. Federal Reserve District No. 8, Mr. F. O. Watts: TOPIC NO. 1.—The reserve held by the member banks in District No. 8 are probably normal when based on present conditions. The legal reserves (lawful money and Federal reserve balances) in St. Louis are probably as low as should be, in view of the crop movement now under way. The banks have adjusted their position to the new reserve requirements, and though actual reserves are lower than held at the season prior to the establishment of the reserve banks they probably have a greater amount of liquid paper available for rediscount than ever before. The surplus in St. Louis of legal reserve (which excludes bank balances) is approx imately three million dollars. Reliance is mainly in the maturing "bought paper" and the extent to which such short-time paper can be made available. It is probable that New York and Chicago balances are not materially above the normal requirements of trade. TOPIC NO. 2.—There seems to be nothing in the situation to cause any change in the discount rates of the Federal Reserve Bank of St. Louis. The bank has recently discounted its 10-day rate and has established a 15-day rate of three per cent (subject to the approval of the Federal Reserve Board) to apply alike to rediscounts and to loans made on collateral under the recent amendment to the law. Federal Reserve District No. 9: TOPIC NO. 1.—Reserve conditions in District No. 9 indicate a better demand for money and an expanding business. The loans of the larger city banks are at high rates mark—even before the heavy crop movement had commenced. It is possible that with the very high price of all kinds of grain—and the necessity for the prompt movement to terminal markets on account of the very poor quality those banks may be forced to use the Federal Reserve Bank facilities. This situation, however, would pass by the first of the year, as by that time the grain will have been very largely marketed. The small crops of all kinds of grain will undoubtedly affect commercial collections; also bring about a decline in commercial and bank deposits. This situation may Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

808 ANNUAL EEPORT OF THE FEDERAL RESERVE BOARD. bring a stiffening of money rates, and before the next crop season the demands of the Federal Reserve Bank be quite urgent—the policy of the Reserve Bank should be conservative—loans should be closely watched and rates moved up when any signs of expansion beyond what is conservative begin to show. TOPIC NO. 2.—The discount policy of the Federal Reserve Bank of the ninth district should be maintained as it is now, so far as the rates are concerned, but they should keep close track of their borrowing customers, and watch their reserve situation, and see that their loans are seasonable and are liquidated at such times as their loans should naturally run off. The low rates of the Federal Reserve Bank, and the ability to get high rates from their customers, sometimes lead small banks to increase their loans beyond the conservative point. This should be watched closely by the Federal Reserve Bank of our district and rates increased when evidence shows that banks are borrowing rather than liquidating their loans. Federal District No. 10, Mr. E. F. Swinney: TOPIC NO. 1.—On account of the enormous income derived from the continuous increase in output of oil at a seemingly high price and the influx of capital being invested in purchase of lands and royalties for leases, together with the prices obtained for farm products of all kinds and the large demand for surplus working stock has given the farmer independence in finances and has increased the deposits of the country bank which in turn increases those in reserve city to such an extent—both the small as well as the larger institutions—can not keep their funds employed in such securities and at such rates as they would feel justified in placing them. As a consequence reserves «are high and I do not see any prospect of them being reduced to any great extent soon. TOPIC NO. 2.—With an era of more or less inflation I do not think it wise to lower the rate of interest, thereby giving institutions inclined to expand an outlet for cheap funds which might cause unhealthy expansion. Federal Reserve District No. 11, Mr. T. J. Record: TOPIC NO. 1.—I beg to advise that the reserves of the banks throughout the eleventh district with narrow exceptions are good. That the satisfactory prices prevailing for farm products, especially cotton, is causing an active market, with the result that banks' receivables are being reduced and reserves increased. TOPIC NO. 2.—The Dallas bank fixed the rate of discount on 15-day paper at three and one-half per cent. I have no change to suggest for their present rates. I will mention, however, that trade paper is very little known in the eleventh district as evidenced by the nominal amount now held by the Dallas bank, and I would recom mend that an abnormally low rate be continued on this class of paper for the special purpose.of encouraging its use. Federal Reserve District No. 12, Mr. Herbert Fleishhacker: TOPIC NOS. 1 AND 2.—There is no reason to consider the change in discount rates in District No. 12 at this time. The reserves are stronger at present than have ever been maintained in the past. In many of the larger institutions in San Francisco, Los Angeles, Portland, and Seattle the reserves are running from thirty to forty per cent. The smaller country banks are relatively in the same condition. This is the first year in probably ten years that the coast country banks have not been borrowers to any extent to take care of the growing deciduous and citrus fruits as well as the grain crops. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

EECOMMENDATIGNS OF THE FEDEKAL ADVISOKY COUNCIL. 809 TOPIC NO. 3. Vault reserves of member banks in Federal Reserve Banks, (a) What use should be made of the permission granted member banks under the Federal Reserve Act, as amended, to carry vault reserve money in Federal Reserve Banks? Recommendation.—The permission granted member banks under the Federal Reserve Act, as amended, to carry vault reserve money in Federal Reserve Banks is all right theoretically and some use can be made of it. The member banks, especially those in the larger cities, will, we believe, aim to keep with the Federal Reserve Banks such portion of their legal reserves as they conveniently can. Until, however, the State banks join the system and daily clearing-house balances can be settled by checks on the Federal Reserve Banks, the member banks, especially in the larger cities, must keep a sufficient supply of cash on hand for settlement of clearing-house balances as well as for counter use. This will necessitate their keeping on hand not only that portion of their legal reserves which the law has here tofore required them to carry in their vaults, but a considerable portion of that which the law has made optional. (b) Suggestions as to how this provision of the law may be made effective. Recommendation.—It would help to make this provision of the law effective if the member banks could feel sure that they could at all times receive from the Federal Reserve Banks gold and currency in the denominations required and if the Federal Reserve Banks could arrange with the Treasury Department to keep on hand a sufficient supply of currency for that purpose. It would aid the Federal Reserve Banks in maintaining such a supply of currency if the func tions of the United States subtreasury were transferred to them. (c) How can the use of the 15-day secured notes of member banks for the purpose of settling or maintaining balances with their Federal Reserve Banks be developed? Recommendation.—The new privileges granted the member banks of borrowing on their promissory notes for a period not exceeding 15 days secured by commercial paper or by United States bonds or notes is a valuable one and will be developed as and when the member banks have occasion to make use of it. The only suggestion we have to make is that the rate on such short loans should be the same as that fixed for rediscounting commercial paper maturing within 10 days. TOPIC NO. 4. Stock ownership by member banks in banking corporations to be organized for con ducting foreign business. Suggested regulations to be issued by the Board in connection with the recent amendment of the Federal Reserve Act. Recommendation.—Foreign banking is a comparatively new prop osition to the bankers of this country. It seems to us that the formulation of regulations in regard to the conditions under which Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

810 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. the national banks may invest in the stock of corporations organized for the purpose of doing international or foreign banking can not be intelligently undertaken until applications from banks desiring to avail themselves of the privilege have been received. These applications will indicate where it is proposed to locate such in stitution^ in what territory they propose to operate, the nature of the business they propose to do and what powers they will want to exercise. The law does not seem to indicate that the Federal Reserve Board should take the initiative in the organization of foreign bank ing corporations. Banks interested in international business will doubtless attend to this. When such action is taken it will have to be in cooperation with the Federal Reserve Board, whose sanction and approval must be secured. As the negotiations proceed the necessary terms and conditions will develop and the Board then will be able intelligently to formulate and prescribe regulations governing and controlling the business proposed. It would seem to us to be impractical to undertake to do this in advance. The Board might let it be known that it is prepared to take up with eligible banks or their representatives the organization by them of banks or cor porations to do international or foreign banking such as is contem plated in the amendments to the Federal Reserve Act approved September 7, 1916, and that it will be prepared to formulate its regulations in connection therewith as soon as it is fully informed as to the territory in which such banks propose to operate and the nature of the business they propose to do. The council has authorized its president to appoint from its members a committee of three to confer on this subject with the Federal Reserve Board or a committee thereof when the Board so desires. TOPIC NO. 5. Check clearing and collection, (a) Should charges by the Federal Reserve Banks on member banks be made per item or per thousand dollars of checks collected? Recommendation.—As the Federal Reserve Banks do not convert the checks they collect into immediately available funds the practice which has been established of making a per item charge to cover cost of handling seems to us to be more nearly correct in principle than it would be to make a charge per thousand on the amount collected. (b) Should Federal Reserve Banks be required to receive for immediate credit (funds to be immediately available) checks drawn on member banks maintaining excess balances: In other words, abrogate the time allowance now in force against such checks? Recommendation.—We understand that in operating the recently abandoned voluntary collection system involving immediate debit Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

RECOMMENDATIONS OF THE FEDERAL ADVISORY COUNCIL. 811 and credit it was found to be impractical for member banks, especially those in the reserve cities, to maintain the necessary balances with the Federal Reserve Banks in excess of their legal reserve requirements for the purpose of protecting the unknowable amount of the checks on them coming into the hands of the Federal Reserve Banks and that the system proved unsatisfactory because of this and of the involuntary encroachments on the legal reserve balances of the member banks which frequently occurred. If under the very limited operation of the voluntary collection system member banks were unable to maintain their reserves in the Federal Reserve Banks they could hardly be expected to do so with the increased volume of items on them which these banks expect to receive under their new collection system. We are therefore of opinion that the Federal Reserve Banks should not be required to receive for immediate credit (funds to be immediately available) checks drawn on member banks maintaining excess balances, thus abrogating the time allow ance now in force against such checks. At all events we think the present system of deferred credits should be tried out on its merits before even a partial return to the former system is con sidered. (c) Should the Federal Reserve Board, at this time, proceed to regulate charges to be made against deposits of out-of-town checks with member banks, such checks being collected through Federal Reserve Banks? Recommendation.—If the ambiguous language of section 16 of the Federal Reserve Act, reading ''The Federal Reserve Board shall by rule fix the charges to be collected by the member banks from its patrons whose checks are cleared through the Federal Reserve Banks and the charge which may be imposed for the service of clearing or collection rendered by the Federal Reserve Banks/7 is to be construed as meaning that the Board can regulate the charges made by member banks against customers for out-of-town checks deposited which are collected through the Federal Reserve Bank, it would appear to be the duty of the Board to undertake the regulation of such charges. If the Board will base its regulation on the principle which we under stand it has already recognized as fair and equitable, viz, that the member banks are entitled to charge their customers the cost of handling such items plus interest at a reasonable rate for the period of the deferred availability of the funds on items collected through the Federal Reserve Banks, we are of the opinion that the member banks would be materially helped in their relations to the public if the Federal Reserve Board should formulate a regulation on that basis. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

814 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. TOPIC NO. 6. What steps should be taken to further the entrance of State banks into the Federal Reserve System? Recommendation.—While State banks are slow to join the Federal Reserve system there are indications that their interest in it is increasing. As the terms upon which they may enter the system have been made as reasonable and attractive as possible we know of nothing that can be done to hasten their action beyond the educa tional propaganda now being carried on. They will probably gradu ally join the system as its usefulness is demonstrated. TOPIC NO. 7. President read a letter from Governor Harding, as follows: SEPTEMBER 18, 1916. Mr. JAMES B. FORGAN, President, Federal Advisory Council, Washington, D. C. MY BEAR SIR: The Federal Reserve Board would appreciate an informal expres sion of opinion from the Federal Advisory Council as to the propriety of a director of a Federal Reserve Bank retaining his directorship after his removal from the district for which he had been chosen. In one of the districts a class B director, whose term will expire on December 3.1, 1917, removed to a city located outside of his district, which city, by the way, is itself a Federal Reserve city, about April 1st of the present year. The Board was advised of the removal by the Federal Reserve agent, but was informed that the director would probably tender his resignation in due course. It now develops that he does not wish to resign but that he contemplates serving out the remainder of the term for which he was elected. Several letters have been received from member banks of the district from which he was chosen, stating that in their opinion they should have the right to choose a director from their own district and asking what the board can do in the matter. A letter received from the director in question indicates some disposition to be guided by the wishes of the board, but is not altogether definite. The board is entirely clear in its opinion as to the action it should take but as this may establish a precedent, it would, as above stated, like to have an informal expression of opinion from the council as to the general policy that should be adopted in cases where a director having removed from his district actually refuses to resign. Very truly, yours, W. P. G. HARDING, Governor. Recommendation.—It was decided that the president should inform the Federal Reserve Board informally that the Federal Advisory Coun cil is of opinion that a director of a Federal Reserve Bank should not continue to serve as a director after he has removed from the district for which he was elected or appointed. Additional recommendation.—The operation of the new Federal Reserve Bank collection system has shown that the general use of the statement now being stamped on bank checks reading l (Collectible at par through the Federal Reserve Bank of ," is misleading to the public and results in confusion and considerable friction between the member banks and their customers. Such chAplr* Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

RECOMMENDATIONS OF THE FEDERAL ADVISORY COUNCIL. 815 being subject to the Federal Reserve Bank's handling charge and in many cases to a charge made by the banks receiving them based on the handling charges plus interest for the deferred availability of the funds during the process of collection through the Federal Reserve Bank they cannot be said to be "collectible at parM under the present system. We would therefore recommend that the words "at par'7 be stricken out and that the only statement permissible on checks collectible through the Federal Reserve Banks should be "collectible through the Federal Reserve Bank of s—." The following members of the Federal Advisory Council were present at this meeting: President James B. Forgan, in the chair; vice president, L. L. Rue, D. G. Wing, J. P. Morgan, W. S. Rowe, J. W. Norwood, Charles A. Lyerly, F. O. Watts, C. T. Jaffray, E. F. Swinney, T. J. Record, Herbert Fleishhacker, and Merritt H. Grim, secretary. Recommendations of the Federal Advisory Council to the Federal Reserve Board, November 20, 1916. TOPIC No. 1. In view of the amendment which permits member banks to use their option as to vault reserves, provided the excess reserve with the Federal Reserve Banks offsets the diminished reserve in* vault, what would it be advisable for the Federal Reserve Banks to do to induce member banks to deposit their excess reserves with them? Recommendation.—As member banks become more familiar with and better accustomed to the working of the Federal Reserve system they will more fully appreciate the desirability for the strengthening of the system of keeping as much of their legal reserves on deposit in the Federal Reserve Banks as may be found practicable. We know of no special inducements that should be offered to member banks to do so at present, but we would reiterate the suggestion we made at our last meeting that "it would help to make this provision of the law effective if the member banks could feel sure that they could at all times receive from the Federal Reserve Banks gold and currency in the denominations required and if the Federal Reserve Banks could arrange with the Treasury Department to keep on hand a sufficient supply of currency for that purpose." If this could be accomplished it is our belief that the member banks would be in clined to carry a greater proportion of their cash reserves with the Federal Reserve Bank. In this connection a resolution was passed nine to one in favor of making Federal Reserve notes available as legal reserve for member banks. (Mr. W. S. Rowe voting in the negative.) Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

816 ANNUAL EEPORT OF THE FEDERAL RESERVE BOARD. TOPIC No. 2. A discussion of the subject of acceptances and acceptance credits in general, and in particular so-called "revolving credits" with a renewal agreement on the part of the accepting bank. In this connection, your attention is called to an address made recently by the writer, in which this subject is discussed (pages 8 to 19). The Board invites comment upon or criticism of its policy regarding such credits, as well as sug gestions as to the course it should adopt in the future. Recommendation.—In regard to bank acceptances and particularly in regard to so-called u revolving credits" with a renewal agreement on the part of the accepting banks we are in accord with the argu ments and the policy based thereon as set forth in the address recently made by Governor Harding to which our attention has been directed. Even if such acceptances may, under a legal interpretation of the wording of the Federal Reserve Act, be regarded as eligible for pur chase by Federal Reserve Banks they are not in our opinion in accord with the spirit of the law. They are in no sense self-liquidating within the time fixed by law and can not be regarded as strictly liquid instruments for credit such as are based on commercial trans actions which themselves provide for their retirement at maturity. In our opinion, therefore, the purchase of them by the Federal Reserve Banks in the open market should be discouraged. TOPIC No. 3. The establishment of branches of national banks where State laws are not in con travention of such policy. The proposed amendment allowing this went over by agreement until the short session of Congress this winter, and in view of the resolution adopted at the convention of the American Bankers' Association of Kansas City (upon which resolution the State bankers were allowed to vote), it is evident that some hard work will be necessary to secure the passage of the proposed amendment. Recommendation.—We still adhere to the opinion expressed in our communication to you of September 21, 1915, to the effect "that the National Bank Act should be amended so as to permit the establish ment of branches by national banks having an unimpaired capital and surplus of not less than $1,000,000 in central reserve and reserve cities provided that no branches are placed outside of the limits of the city where the head office of the parent bank is located." We are advised that such a privilege granted to national banks would not be affected by State laws and in our opinion any Federal legisla tion granting such a privilege should apply to all banks in the national system of adequate capital or to none. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

KECOMMESTDATIONS OF THE FEDERAL ADVISORY COUNCIL. 817 TOPIC No. 4. In connection with the clearing system for the collection of country checks, the suggestion has been made that Federal Reserve Banks allow member banks in 4 the smaller cities and towns having no clearing house a moderate fee for the col lection of checks drawn on State banks; the theory being that while a bank may be obligated to remit without charge to the reserve bank for checks drawn upon itself, it has no such duty in the case of items which it has first to collect before remitting. Recommendation.—The statement published in the Federal Reserve bulletin for October of the operations of the interdistrict clearing sys tem indicates that the number of State banks agreeing to remit at par is steadily increasing and that checks on nearly half of the State banks in the country are now being remitted for at par. It would seem, therefore that the system is satisfactorily developing and under these conditions we think it inadvisable that any change should be made at present. ADDITIONAL TOPIC. (Submitted verbally by Governor Harding.) The suggestion that the law be amended so as to change the time when bank bal ances with reserve agents will cease to count as legal reserve from November 16, 1917, to February or March, 1917. Recommendation.—In response to your suggestion that the pro visions of the law which require that after November 16, 1917, balances in the hands of legal reserve agents will cease to count as lawful reserve be made effective at an earlier date, in view of present financial conditions we would favor amending the law so as to grant authority to the Federal Reserve Board to make this provision effective at any date prior to November 16, 1917, on giving member banks sixty days' notice. ADDITIONAL TOPICS. (SUBMITTED VERBALLY BY VICE GOVERNOR DELANO.) The suggestion that the law might be amended to provide that a definite percentage of reserve should be kept on deposit with the Federal Reserve Banks, leaving it to the individual member banks to keep whatever amount of cash on hand for till money they required. Recommendation.—The suggestion meets with the general favor of the council. NOTE.—This topic was proposed and considered informally during a joint session with the Federal Reserve Board. Additional recommendation.—Proposed substitute for fifth para graph of section 13 of the Federal Reserve Act: Any member bank may accept or, agree to accept or pay 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 100823°—-19 52 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

818 ANNUAL KEPORT OF THE FEDERAL RESERVE BOARD. 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. Any member bank may undertake that another bank or banker shall accept or pay any such drafts or bills of exchange drawn upon such bank or banker, and may indemnify any bank or banker against the acceptance or payment of any such bills of exchange drawn upon such other bank or banker. No member bank shall accept or agree to accept or pay such bills, or undertake that others shall accept or pay such bills, or indemnify others against the acceptance or payment of such bills, whether in a foreign or domestic transaction, for any one person, company, firm, or corporation to an amount equal at any time in the aggregate to more than ten per centum of its paid-up and unimpaired capital stock and surplus, unless the bank is secured either by attached documents or by some other actual security growing out of the same transaction as the acceptance, and no bank shall accept such bills to an amount equal at any time in the aggregate to more than one-half of its paid-up and unimpaired capital stock and surplus, except by authority of the Federal Reserve Board, under such general regulations as said Board may prescribe, but not to exceed the capital stock and surplus of such bank, and such regulations shall apply to all banks alike regardless of the amount of capital stock and surplus. In addition to the powers granted in the preceding paragraph of this section, any member bank may accept or agree to accept or pay drafts or bills of exchange drawn upon it and payable at sight and may undertake that any other bank or banker shall accept or pay sight bills drawn on such other bank or banker and may indemnify any other bank or banker against the acceptance or payment by such bank or banker of any such sight bills, drawn upon such bank or banker, but no member bank shall accept or agree to accept or pay such sight bills, or undertake that others shall accept or pay such sight bills or indemnify others against the acceptance or payment of such sight bills, for any one person, firm or corporation for an amount equal at any time in the aggregate to more than ten per cent of its paid-up and unimpaired capital and surplus, and no member bank shall accept or agree to accept or pay such sight bills, or undertake that others shall accept or pay such sight bills, or indemnify others against the accept ance or payment of such sight bills, to an amount equal at any time in the aggregate to more than twenty-five per cent of its paid-up and unimpaired capital stock and surplus, except by authority of the Federal Reserve Board, under such general regulations as said Board may prescribe -but not to exceed fifty per cent of the capital stock and surplus of such bank. NOTE.—The above proposed amendment was referred to a special committee consisting of the president, vice president, and Mr. Wing, to take the matter up with the governor and vice governor of the Federal Reserve Board and also the Comptroller of the Currency if in the committee's judgment it is thought advisable. The committee had a conference with the governor and vice governor of the Federal Reserve Board and secure their favorable consideration of it. Additional recommendation.—The council recommends that to the exceptions contained in section 5202 R. S. as amended by section 13 of the Federal Reserve Act the following should be added as a sixth exception: V Sixth. Liabilities as an endorser on accepted bills of exchange actually owned by the association and rediscou^ted at home or abroad. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

RECOMMENDATIONS OF THE FEDERAL ADVISORY COUNCIL. 819 NOTE.—This proposed amendment was also referred to a special committee, consisting of the president, vice president, andMr. Wing to take the matter up with the governor and vice governor of the Federal Reserve Board, which the committee did, receiving their favorable consideration of it. Additional recommendation.—It was suggested that the council recommend to the Federal Reserve Board the advisability of having the Secretary of the Treasury exchange all thirty-year 3 per cent bonds of the United States for 2 per cent bonds, instead of half thirtyyear 3 per cent bonds and half one-year 3 per centnotes, as now pro vided by law. After consideration the President was requested to present this matter for informal discussion at the joint meeting with the Federal Reserve Board, which was done. The following members of the Federal Advisory Council were present at this meeting: President, James B. Forgan, in the chair; vice president, L. L. Rue; D. G. Wing, W. S. Rowe, J. W. Norwood, Charles A. Lyerly, F. O. Watts, C. T, Jaffray, T. J. Record, Herbert Fleishhacker; and Merritt H. Grim, secretary. Recommendations of the Federal Advisory Council to the Federal Reserve Board in regard to the amendments to the Federal Reserve Act proposed by the Federal Reserve Board, January, 1917. (Formally approved by Federal Advisory Council, February 19, 1917.) No. 1. Amendment of section 16 which provides— (a) for the issue of Federal Reserve notes directly against the deposit of 100 per cent gold; or 100 per cent paper, or both; (b) for the counting of gold held by the Federal Reserve agents as security for notes, as part of the gold reserve required to be held by the bank against such Federal Reserve notes. Recommendation.—Meets with the approval of the Federal Advisory Council. No. 2. Amendment of section 19, abbreviating and simplifying the clauses in section 19 which relate to reserve requirements. This provides that all member banks shall maintain reserves in the Federal Reserve Bank as follows: Against Against demand time deposits, deposits. Per cent. Per cent. (a) Country banks 7 3 (&) Reserve city banks 10 3 (c) Central reserve city banks 13 3 and in addition every member bank is required to keep in its own vault for till money an amount of specie or currency (not necessarily gold or lawful money) equal to five per cent of its demand deposits, less the amount of net balance with Federal Reserve Banks in excess of the minimum above stipulated. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

820 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. Recommendation.—This amendment is in harmony with one of the basic principles of the Federal Reserve Act to the effect that the bulk of the gold held as reserves for bank deposits should be mobil ized in the Federal Reserve Banks. From the standpoint, however, of a practical working basis the council doubts if so much as is pro posed of the member banks' available cash should be arbitrarily tied up in the form of compulsory balances with the Federal Reserve Banks. The council, at its meeting of September 19 last, drew the Board's attention to the fact that until the State banks join the system and daily clearing house balances can be settled by checks on the Federal Reserve Banks the member banks, especially in the larger cities, must keep a sufficient supply of gold or lawful money on hand for the settlement of such balances as well as for their counter use. Besides this it would be a conservative policy for the member banks to keep in their own vaults a reasonable amount of gold or lawful money proportionate to their demand deposits. Banks located in Federal Reserve cities now receive from the Federal Reserve Banks late in the afternoon checks on themselves in large volume and amount which have accumulated during the day and have been charged against their legal reserve balances in such large volume and amount as to hamper them in maintaining their legal reserve balances. In our opinion 5 per cent cash on hand would not be sufficient for these purposes, and from a practical standpoint it would facilitate the operations of the member banks if the minimum compulsory balances to be kept by them with the Federal Reserve Banks against their demand deposits were at least reduced 1 per cent in each class and the percentage of the till money correspondingly increased in the case of the reserve city and central reserve city banks, the increase in till money in the case of the country banks being unnecessary. The council's recommendation is therefore as follows: Deposits Deposits in Fed in Fed eral Re eral Re serve serve Till Banks Banks money. against against demand time deposits. deposits. Per cent. Per cent. Per cent. Country banks 6 3 5 9 3 6 Central reserve city banks 12 3 6 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

RECOMMENDATIONS OF THE FEDERAL ADVISORY COUNCIL. 821 NO. 3. Amendment of section 11, so as to permit the Federal Reserve Board to raise reserve requirements in emergencies, just as it is now empowered in certain contingencies of a different kind to lower those requirements. Recommendation.—The council is of opinion that it would be un desirable and unnecessary to grant such power to the Federal Reserve Board. The Board would only take action under such power when member banks are overburdened with surplus cash reserves and its action then could only apply to member banks. The effect would therefore be that member banks would be com pelled to increase their noninterest-bearing balances with the Federal Reserve Banks, while nonmember banks would have the free use of their funds. It would place another stumbling block in the way of State banks joining the system. NO. 4. Amendment of section 13, to permit nonmember State banks and trust companies, even though too small to be eligible for membership in the Federal Reserve Banks, to avail themselves of the clearing and collection facilities of the Federal Reserve Banks, provided that they cover at par checks on themselves sent for collection by the Federal Reserve Bank, and provided further that they keep a compensating balance with the Federal Reserve Bank in an amount to be deter mined under rules prescribed by the Federal Reserve Board. Recommendation.—This might work to the mutual advantage of the member banks in connection with the check collection system and of nonmember banks willing to conform to the rules prescribed by the Federal Reserve Board as well as to that of the Federal Reserve Banks through compensating balances. The experiment might be worth trying. NO. 5. Amendment of section 22—the penal statute—so as to define more clearly the rights and limitations of directors in the matter of accepting fees or compensa tion other than the ordinary fees paid directors for legitimate services rendered in the regular course of business, the performance of which services is not incumbent upon them in their capacity as directors. Recommendation.—The council would recommend that the pro posed addition to section 22 commencing with "Provided, however, That nothing in this act contained,? should be amended as follows: Provided, however, That nothing in this act contained shall be construed to prohibit a director, officer, or employee from receiving the same rate of interest paid to other depositors for similar deposits made with such bank; or to prohibit a director, who is not an officer or employee, from receiving, directly or indirectly, the usual and customary commissions or fees for services rendered in buying and selling securities or other investments for or on account of such bank, but in this latter caoo the action of the board of directors, in directing each purchaoo-of-salc of such securities or other investments, muot be by an affirmative vote or written ascent of at least three fourths of the members of the board exclusive of thc-dircctor intercotod, and But each such Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

822 ANNUAL REPORT OF THE FEDERAL RESERVE BOAR©. transaction must be recorded in the minutes of the meeting of said board, such minutes to specify the name of the director and the firm or corporation with which he is con nected, if any, through which such order is %ebe executed, together with the amount of the fee or commission te be paid on each transaction; and, provided, further that notes, drafts, bills of exchange, or other evidences of debt executed or indorsed by directors of a member bank may be discounted with such member bank on the same terms and conditions as other notes, drafts, bills of exchange, or evidences of debt upon the affirmative vote or written assent of at leapt three fourths of the members of the board of directors of such member bank. The council makes this recommendation because in its judgment an affirmative vote or written assent of at least three-fourths of the members of the Board is an unnecessary restriction in connection with such services by a director as the buying and selling of securities, and inasmuch as notes, drafts, bills of exchange, or other evidences of debt executed or indorsed by bank directors are as" a rule the very best of their class, the placing of special restrictions on the discount ing of such instruments for directors would only unnecessarily and unwarrantably impede legitimate business or force it into other banks. NO. 6. Amendment of section 13 to restore the provision which was by error stricken from the Act in the amendments of September 7,1916, thus restoring to national banks, with the approval of the Federal Reserve Board, the right to accept up to 100 per cent of their capital and surplus in transactions involving imports and exports. Recommendation.—The council approves this amendment. NO. 7. Amendment of section 17, to cancel the provision of the national bank act which requires national banks to maintain a minimum deposit of Government bonds with the Treasurer of the United States. Recommendation.—The council approves this amendment. NO. 8. Amendment of section 25, to authorize member banks located in cities of more than 100,000 population and which have a capital and surplus of more than $1,000,000 to establish branches in the same city, provided the State laws do not prohibit State banks and trust companies from establishing branches. Recommendation.—The council has already advised the Board that it approves the authorization of member banks located in cities of more than 100,000 population and which have a capital and surplus of more than $1,000,000 to establish branches in the same city, but disapproves the granting of such a privilege to the banks in some States while it is withheld from banks in other States, irrespective of State laws affecting State banks and trust companies in regard to the establishment of branches by them. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

RECOMMENDATIONS OF THE FEDERAL ADVISORY COUNCIL. 823 NO. 9. Amendment of section 9 to authorize mutual savings banks not having a capital stock to become associate members of the Federal Reserve system under certain prescribed conditions. Recommendation.—The council approves this amendment. NO. 10. Amendment of section 18 so as to give to United States one-year 3 per cent gold notes in the hands of Federal Reserve Banks the circulation privilege for the issuance of Federal Reserve Bank notes. Recommendation.—The council would recommend that instead of amending section 18 so as to give United States one-year 3 per cent gold notes in the hands of Federal Reserve Banks the circulation privilege for the issuance of Federal Reserve Bank notes that the law providing for the exchange of 2 per cent gold bonds bearing the circulation privilege, but against which no circulation is outstanding, for one-year gold notes to an amount not exceeding one-half of the 2 per cent bonds so tendered for exchange, be so amended as to do away with the one-year gold notes entirely and provide that the 2 per cent gold bonds may be exchanged for an equal amount of 30-year 3 per cent gold bonds without the circulation privilege. NO. 11. Amendment of section 4 to abolish the title and office of deputy reserve agent, thus having two unattached Class C directors instead of one as at present, and to create the position of Assistant Federal Reserve agent, who shall not be a director of the bank, but who shall be a salaried bonded officer in the Federal Reserve agent's department serving at all time as an assistant to the Federal Reserve agent and qualified to act for the agent in his absence. Recommendation.—As member banks and others doing business with the Federal Reserve agent and his assistant would not neces sarily be charged with knowledge of the absence or disability of the Federal Reserve agent the restricted power of his assistant to act in his name and stead only during his absence or disability should for their protection be removed by striking out the words " during his absence or disability" occurring in the last paragraph of the proposed amendment. If the assistant should act in any matter of importance during the presence or ability of the agent to act for himself his action would be null and void. Otherwise the council sees no objection to the amendment. The following members of the Federal Advisory Council were present at the meeting on February 19, 1917: President, J. B. Forgan, in the chair; vice president, L. L. Rue; D. G. Wing, J. P. Morgaa, W. S. Rowe, J. W. Norwood, Charles A. Lyerly, F. O. Watts, John R. Mitchell, E. F. Swinney, T. J. Record, Herbert Fleischhacker, and Merritt H. Grim, secretary. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

826 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. It is quite evident that there are many functions performed by the Subtreasuries which the Federal Reserve Banks are not equipped and could not probably be efficiently equipped to perform. We are not sufficiently familiar with the operation of these functions to give specific advice as to which of them it would be practicable or advis able to turn over to the Federal Reserve Banks. We agree with the Secretary of the Treasury that this is an important matter and should be considered deliberately. It would seem to be one which can best be worked out between the Treasury officials and your Board, cooperating together toward establishing the most efficient and most economical method of handling the public business in the interest of the public. The benefits to be derived from any changes afford the best if not the only reason for making them. TOPIC NO. 5. Should the Federal Reserve Board employ a competent man to make a thorough study and investigation of foreign exchange and its bearing on the efforts being made to establish dollar exchange in this country? Recommendation.—The value of such a study or investigation would entirely depend on the practical knowledge, experience, efficiency, and breadth of view of the student or investigator. A foreign exchange department manager whose training and experience has led him to gather in under the keenest of competition all the business he could control for the profit in it, might find difficulty in grasping from a broader point of view the use that should be made of such a department in a Federal Reserve Bank. At the same time no one could satisfactorily make such an investigation who has had no practical experience and who does not thoroughly understand the business in practice as well as in principle. Such an investigator should be very carefully selected and may be difficult to find, but when found we have no doubt that his investigation and report would prove of sufficient value to the Board and all connected with the Federal Reserve system, to warrant his appointment. The Board should, however, tentatively settle in advance just what attitude the Federal Reserve Banks will assume toward the foreign exchange business and the investigator should be given to understand that his investigation is to be made on the broad basis of how best Federal Reserve Banks can cooperate with their member banks in an effort to develop the foreign exchange business and to establish dollar exchange in this country. The investigation should be made broad enough to include the elements other than banking facilities which contribute to the development of foreign business, such as transportation, insurance, consular service, etc. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

KECOMMEKDATIONS OF THE FEDERAL ADVISORY COUNCIL. 827 TOPIC NO. 6 (SUBMITTED VERBALLY BY GOVERNOR HARDING AT JOINT CONFERENCE). Would the council recommend a plan providing for rotation in its membership ? Recommendation—As the Federal Reserve Act provides that mem bers of the Federal Advisory Council shall be elected annually by the directors of the Federal Reserve Banks, we doubt the propriety of either the Federal Reserve Board or this council taking any action or making any recommendation in the matter. Additional recommendation.—Our attention has been directed to the proposed plan whereby a draft drawn by a member bank upon its Federal Reserve Bank could be made receivable at par by another designated Federal Reserve Bank. In order that such a plan should be made practically safe and effec tive in its operation drafts drawn under it should be made ''payable upon advice" instead of "receivable for immediate availability" at the designated Federal Reserve Bank. In connection with all new plans inaugurated in the Federal Reserve system for the transfer of funds or the collection of checks "safety first" should be the watchword; otherwise such unfortunate complications accompanied with probable loss as have lately arisen in connection with the collection of checks through the Federal Reserve Bank of San Francisco on three State banks in Seattle which recently failed, are likely to be repeated to the discredit of the system. (Mr. T. J. Record voted in the negative as to the adoption of this recommendation, asking permission to file a minority report, which was granted. See minority report hereto attached.) MINORITY REPORT SUBMITTED BY MR. T. J. RECORD. Whereas, The services rendered by the Federal Reserve Banks will be extended and made more helpful both to the member banks and to the general public when exchange written by a member bank on the reserve bank of its district is made immedi ately available at a Federal Reserve Bank of another district, designated in the face of the draft. Therefore, We approve the recommendation made on this question by the governors of the Federal Reserve Banks at their meeting held January 22, 1917. We desire to state that the system will be further improved when exchange written by a member bank on the Federal Reserve Bank of its district is immediately available at any other Federal Reserve Bank. Additional recommendation.—Resolved, That the Federal Advisory Council reiterates its previous expression upon the issue of Federal Reserve notes directly against the deposit of 100 per cent gold or 100 per cent of paper, or both, and for the counting of gold held by the Federal Reserve agents as security for notes as part of the gold reserve required to be held by the banks against such Federal Reserve notes. In the opinion of the council, no more important Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

828 ANNUAL KEPOET OF THE FEDERAL RESERVE BOARD. recommendation has been presented by the Federal Reserve Board. We, therefore, strongly urge the enactment of the principle into law. Resolved further, That the president of the council is instructed to at once convey to the Federal Reserve Board this unanimous expression of the entire Federal Advisory Council. Additional recommendation.—Resolved, That in the opinion of this council the last clause of section 3 of Senate bill 8259 (dated Feb. 14, 1917) reading as follows: Provided further, That in no event shall a bank accept for any one person, company, firm, or corporation to an amount equal at any time in the aggregate to more than twenty per centum of its paid up and unimpaired capital stock and surplus, should be stricken out. All the members of the council were present at this meeting. Recommendations by the Federal Advisory Council to the Federal Reserve Board, April 18, 1917. TOPIC NO. 1. The Hayes Bill. Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled, That every bank, banking association, and trust company authorized by the laws of the United States or of any State to receive money on deposit subject to check shall pay an annual tax of one-tenth of one per cent on the aggregate amount of checks paid by it during each fiscal year which bear the indorsement of or which are collected through any other bank, banking association, trust company, or private banker located outside of the State in which such checks are made payable, and every bank, banking association, and trust company shall make a return at the end of each quarterly period to the Collector of Internal Revenue showing the aggregate amount of such checks paid during that quarter, such return being verified by the oath of at least two of its officers, Provided, however, That this tax shall not apply to any Federal Reserve Bank or member bank of any Federal Reserve Bank, or to any nonmember bank or trust com pany which carries and maintains a collection or exchange account with any Federal Reserve Bank under authority of Section 2 of this act. Sec. 2. Any Federal Reserve Bank, solely for the purpose of exchange or of collection, may receive from any non-member bank or trust company deposits of current funds in lawful money, national bank notes, Federal Reserve notes, checks and drafts payable upon presentation, or maturing notes and bills: Provided, Such non-member bank or trust company maintains with the Federal Reserve bank of its district, under such rules and regula tions as the Federal Reserve Board may prescribe, a balance in an amount to be determined by such Board, but in no event to exceed Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

EECOMMENDATIONS OF THE FEDERAL ADVISORY COUNCIL. 829 the amount of reserves which it would be required to maintain with its Federal Reserve Bank if it were a member bank, and: Provided, further, That such non-member bank or trust company agrees to comply with the provisions of law and the regulations of the Federal Reserve Board relating to the collection or clearance of checks, drafts, notes, and bills through Federal Reserve Banks. Recommendation.—The council is of opinion that the Hayes bill ought not at the present time to be pressed .as it seems to be inoppor tune to introduce any measure of a coercive character, when the-coop eration of all the State banks and trust companies is so much needed to assist in carrying out the financial program of the Government. TOPIC NO. 2. The proposed Government bond issue. Recommendation.—The council believes that the first offering of long-time bonds should be $1,000,000,000, if that amount should be adequate to meet the immediate necessities of the Government, in order that, first: a successful flotation may be assured, and, second, the amount may not be materially in excess of short certificates which may be issued in anticipation of such issue, thus avoiding the tying up of either money or bank credits for any length of time. If handled in this manner, successive offerings being made as required by the Government, the entire bond financing could be done through the Federal Reserve Banks as fiscal agents for the Treasury and serious disturbance of bank balances avoided. This method coupled with a careful use of short certificates would in our opinion obviate the necessity for a general deposit of Government funds in the banks of the country. In our opinion the bonds should be payable in thirty years, callable after five years. TOPIC NO. 3. Taxation. Recommendation.—In the matter of the taxation as suggested by the Secretary of the Treasury the sense of this council is: First. That the proportion of war cost for the first year to be pro vided by taxes, viz, 50 per cent, would impose too great a strain upon industry and the investable surplus of the country; the proportion should not exceed 25 per cent for the first year. Second. That to impose a surplus profits tax and an additional income tax on the incomes of the calendar year 1916 would, besides being unjust, put an excessive burden upon corporations and upon individuals, who having provided for the taxes of that year and having thereby discharged their tax obligation to the Government have dis posed of the balance of their profits by placing them either in perma nent improvements or fixed investments. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

830 ANNUAL BEPORT OF THE FEDERAL RESERVE BOARD. Third. That since the Government is about to make huge demands upon the investable surplus of the country it would be most advisable so to frame the tax measures that large incomes from which is derived the greater part of that fund should not be taxed in an undue pro portion. In this way industry may continue to finance itself and at the same time the Government obtain the needed funds with the least possible disturbance of business. Fourth. It is most desirable that the taxes to be levied should be upon luxuries and as little as possible upon thrift, enterprise, and savings. TOPIC NO; 4. Amendments to the Federal Reserve Act as proposed by the Federal Reserve Board. A BILL To amend the act approved December twenty-third, nineteen hundred and thirteen, known as the Federal Beserve Act, as amended by the acts of August fourth, nineteen hundred and fourteen; August fifteenth, nineteen hundred and fourteen; March third, nineteen hundred and fifteen; and September seventh, nineteen hundred and sixteen. Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled, That section four of the act approved December twenty-third, nineteen hundred and thirteen, known as the Federal Reserve Act, be amended by striking out the sentence reading as follows: "One of the directors of Class C, who shall be a person of tested banking experience, shall be appointed by the Federal Reserve Board as deputy chairman and deputy Federal Reserve agent, to exercise the powers of the chairman of the Board and Federal Reserve agent in case of absence or disability of his principal," and by adding in place thereof the following: u Subject to the approval of the Federal Reserve Board each Federal Reserve agent shall appoint such assistants, clerks, and other employees as may be deemed necessary to properly conduct the business of his office. Under regulations of the Board the Federal Reserve agent shall prescribe the duties of such employees, fix their compensation, and for his protection may require bonds of those whose duties make this necessary or advisable. He may, with the approval of the Federal Reserve Board, designate one of his assistants as acting Federal Reserve agent in the absence or disability of the Federal Reserve agent, and, under rules and regulations of the Federal Reserve Board, may delegate to such acting Federal Reserve agent such powers and duties as the circumstances may require; and the assistant so designated shall, while acting as Federal Reserve agent, assume full responsi bility for all acts performed by him. The Federal Reserve Board may require such bond of the acting Federal Reserve agent as it may deem necessary. "One of the directors of Class C shall be appointed by the Federal Reserve Board as vice chairman to exercise the powers of the chairman of the Board in his absence or disability. In the absence of the chairman and vice chairman the third Class C director shall preside at the meetings of the Board and perform the duties of chairman." SEC. 2. That section nine of the Federal Reserve Act be amended and reenacted to read as follows: "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 for the right to sub scribe 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, acting under such rules and regulations as it may prescribe, subject to the provisions of this act, may permit the applying bank to become a stockholder of such Federal Reserve bank. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

RECOMMENDATIONS OF THE FEDERAL ADVISORY COUNCIL. 831 liIn 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 their officers, agents, or 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. uAs 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 examin ers selected or approved by the Federal Reserve Board. " Whenever the directors of the Federal Reserve Rank 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 Federal 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 submitted. The expenses of all examinations, other than those made by State authorities, shall be assessed against and paid by the banks examined in the same manner and at the same rate that national banks are assessed for such expenses. uIf 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. u Any State bank or trust company desiring to withdraw from membership in a Federal Reserve Bank may do so, after six months1 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 ten per centum of its capital stock for the purpose of effecting voluntary withdrawal during that year. " All 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 this section, all of its rights and privileges as a member bank shall thereupon cease and deter mine, 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 subscrip tion 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 Digitized for oFthReAr SbEalRan ce due from the Federal reserve bank. http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

832 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. "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. Subject to these provisions 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 com pany, and may continue to exercise all corporate powers granted it by the State in which it was created, and shall be entitled to all the privileges of member banks: Provided, however, 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 shall not be considered as borrowed money within the meaning of this Act.. 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 guarantee 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 mem bership under authority of this section to certify any check drawn upon the association unless the person or company drawing the check has on deposit with the association 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 the association, but the act of any officer, clerk, or agent of any asso ciation in violation of this section shall subject such bank to a forfeiture of its member ship in the Federal reserve system upon hearing by the Federal Reserve Board." Sec. 3. That the first paragraph of section thirteen be amended so as to read as follows: " Any Federal reserve bank may receive from any of its member banks, and from the United States, deposits of current funds in lawful money, national-bank notes, Federal reserve notes, or checks, and drafts, payable upon presentation, and also, for collection, maturing notes and bills; or, solely for purposes of exchange or of col lection, may receive from other Federal reserve banks deposits of current funds in lawful money, national-bank notes, or checks upon other Federal reserve banks, and checks and drafts, payable upon presentation within its district, and maturing notes and bills payable within its district; or, solely for the purposes of exchange or of collection, may receive from any nonmember bank or trust company deposits of current funds in lawful money, national-bank notes, Federal reserve notes, checks and drafts payable upon presentation, or maturing notes and bills: Provided, That such nonmember bank or trust company maintains with the Federal reserve bank of its district a balance in an amount to be determined by the Federal Reserve Board under such rules and regulations as it may prescribe, but the Federal Reserve Board shall in no case require a nonmember bank to maintain a balance in excess of the amount it would be required to carry as reserve with its Federal reserve bank as a memebr bank." Sec. 4. That the fifth paragraph of section thirteen be, and is hereby, amended further so as to read as follows: "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 docu- Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

RECOMMENDATIONS OF THE FEDERAL ADVISORY COU1STCIL. 833 ments 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 docu ment conveying or securing title covering readily marketable staples. No member bank shall accept, whether in a foreign or domestic transaction, for any one person, company, firm, or corporation to an amount equal at any time in the aggregate to more than ten per centum of its paid-up and unimpaired capital stock and surplus, unless the bank is secured either by attached documents or by some other actual security growing out of the same transaction as the acceptance; and no bank shall accept such bills to an amount equal at any time in the aggregate to more than onehalf of its paid-up and unimpaired capital stock and surplus: Provided, however, That the Federal Reserve Board, under such general regulations as it may prescribe, which shall apply to all banks alike regardless of the amount of capital stock and surplus, may authorize any member bank to accept such bills to an amount not exceeding at any time in the aggregate one hundred per centum of its paid-up and unimpaired capital stock and surplus: Provided, further, That the aggregate of acceptances growing out of domestic transactions shall in no event exceed fifty per centum of such capital stock and surplus." Sec. 5. That section sixteen, paragraphs two, three, four, five, six, and seven, be amended and reenacted so as to read as follows: "Any Federal reserve bank may make application to the local Federal reserve agent for such amount of the Federal reserve notes hereinbefore provided for as it may require. Such application shall be accompanied with a tender to the local Federal reserve agent of collateral in amount equal to the sum of the Federal reserve notes thus applied for and issued to such application. The collateral security thus offered shall be notes, drafts, bills of exchange, or acceptances rediscounted under the provisions of section thirteen of this Act, or bills of exchange indorsed by a member bank of any Federal reserve district and purchased under the provisions of section fourteen of this Act, or bankers' acceptances purchased under the pro visions of said section fourteen, or gold or gold certificates. The Federal Reserve agent shall each day notify the Federal Reserve Board of all issues and withdrawals of Federal reserve notes to and by the Federal reserve bank to which he is accredited. The said Federal Reserve Board may at any time call upon a Federal reserve bank for additional security to protect the Federal reserve notes issued to it. "Every Federal reserve bank shall maintain reserves in gold or lawful money of not less than thirty-five per centum against its deposits and reserves in gold of not less than forty per centum against its Federal reserve notes in actual circulation: Provided, however, That when, the Federal reserve agent holds gold or gold certificates as collateral for Federal reserve notes issued to the bank the reserve that such bank is required to maintain against its Federal reserve notes in actual circulation shall be reduced in a corresponding amount, and not onset by-geld or lawful money-deposited-wife-the j^edcral reserve ageak- Notes so paid out shall bear upon their faces a distinctive letter and serial number, which shall be assigned by the Federal Reserve Board to each Federal reserve bank. Whenever Federal reserve notes issued through one Federal reserve bank shall be received by another Federal reserve bank they shall be promptly returned for credit or redemption to the Federal reserve bank through which they were originally issued, or, upon direction of such Federal reserve bank, they shall be forwarded direct to the Treasurer of the United States to be retired. No Federal reserve bank shall pay out notes issued through another under penalty of a tax of ten per centum upon the face value of notes so paid out. Notes presented for redemption at the Treasury of the United States shall be paid out of the redemp tion fund and returned to the Federal reserve banks through which they were originally issued, and thereupon such Federal reserve bank shall, upon demand of +V»o ftor'rofanr rvf fV>o TV^osmrAr renmT-vnraa ssnr>Ti rorlom-nfinn -fnnrl in lawful TYi^notT Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

834 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. gold certificates, then such funds shall be reimbursed to the extent deemed necessary by the Secretary of the Treasury in gold or gold certificates, and such Federal reserve banks shall, so long as any of its Federal reserve notes remain outstanding, maintain with the Treasurer in gold an amount sufficient in the judgment of the Secretary to provide for all redemptions to be made by the Treasurer. Federal reserve notes received by the Treasurer, otherwise than for redemption, may be exchanged for gold out of the redemption fund hereinafter provided and returned to the reserve bank through which they were originally issued, or they may be returned to such bank for the credit of the United States. Federal reserve notes unfit for circulation shall be returned by the Federal reserve agents to the Comp troller of the Currency for cancellation and destruction. "The Federal Reserve Board shall require each Federal Reserve Bank to maintain on deposit in the Treasury of the United States a sum in gold sufficient in the judg ment of the Secretary of the Treasury for the redemption of the Federal Reserve notes issued to such bank, but in no event less than five per centum of the total amount of notes issued less the amount of gold or gold certificates held by the Federal Reserve agent as collateral security; but such deposit of gold shall be counted and included as part of the forty per centum reserve hereinbefore required and shall be counted and con sidered as if collateral security deposited with the Federal Reserve agent. The Board shall have the right, acting through the Federal Reserve agent, to grant in whole or in part or to reject entirely the application of any Federal Reserve Bank for Federal Reserve notes; but to the extent that such application may be granted the Federal Reserve Board shall, through its local Federal Reserve agent, supply Federal Reserve notes to the bank so applying, and such bank shall be charged with the amount of such notes issued to it and shall pay such rate of interest on said amount a$ may be established by the Federal Reserve Board and the amount of on only that amount of such notes which equals the total amount of its outstanding Federal Reserve notes less the amount of gold or gold certificates held by the Federal Reserve agent as collateral security. Such Federal Reserve notes so issued to any such bank shall, upon delivery, together with such notes of such Federal Reserve Bank as may be issued under section eighteen of this act upon security of United States two per centum Government bonds, become a first and paramo ant lien on all the assets of such bank. Any Federal Reserve Bank-may at-any-timc reduce its liability for outotanding Federal Reserve notes by depositing with the Federal Reserve agent its Federal Reserve notco, gold, gold certificates, or lawful money of the United States.- -Federal Reserve notco so deposited shall not be reissued, except upon compliance with tho conditions of an original issue. offered by the Reserve bank of which he is a director. Upon the request of the Sec retary of the Treasury the Federal Reserve Board shall require the Federal Reserve agent to transmit oo much of said gold to the Treasury Treasurer of the United States so much of the gold held by him as collateral security for Federal Reserve notes as may be required for the exclusive purpose of the redemption of such notes Federal Reserve notes. "Any Federal Reserve Bank may at its discretion withdraw collateral deposited with the local Federal Reserve agent for the protection of its Federal Reserve notes deposited with it issued to it and shall at the same time substitute therefor other like collateral of equal amount with the approval of the Federal Reserve agent under regulations to be prescribed by the Federal Reserve Board. Any Federal Reserve Bank may retire any of its Federal Reserve notes by depositing them with the Federal Reserve agent or with the Treasurer of the United States, and such Federal Reserve Bank shall thereupon be entitled to receive back the collateral deposits with the Federal Reserve agent for the security of such notes. FederaVJReserve Banks shall not be required to maintain the Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

RECOMMENDATIONS OF THE FEDERAL ADVISORY COUNCIL. 835 reserve or the redemption fund heretofore provided for against Federal Reserve notes which have been retired; nor shall they be further liable to pay any interest charge which may have been imposed thereon by the Federal Reserve Board. Federal Reserve notes so depos ited shall not be reissued except upon compliance with the conditions of an original issue. uAll Federal Reserve notes and all gold, gold certificates, and lawful money issued to or deposited with any Federal Reserve agent under the provisions of the Federal Reserve Act shall hereafter be held for such agent, under such rules and regulations as the Federal Reserve Board may prescribe, in the joint custody of himself and the Federal Reserve bank to which he is accredited. Such agent and such Federal Reserve Bank shall be jointly liable for the safe-keeping of such Federal Reserve notes, gold, gold certificates, and lawful money. Nothing herein contained, however, shall be construed to prohibit a Federal Reserve agent from depositing gold or gold certificates with the Federal Reserve Board to be held by such board subject to his order or with the Treasurer of the United States jor the purposes authorized by law." Sec. 6. That section sixteen be further amended by adding at the end of the section the following: '' That the Secretary of the Treasury is hereby authorized and directed to receive deposits of gold coin or of gold certificates with the Treasurer or any Assistant Treasurer of the United States when tendered by any Federal Reserve Bank or Federal Reserve agent for credit to its or his account with the Federal Reserve %Board. The Secretary shall pre scribe by regulation the form of receipt to be issued by the Treasurer or Assistant Treas urer to the Federal Reserve Bank or Federal Reserve agent making the deposit, and a duplicate of such receipt shall be delivered to the Federal Reserve Board by the Treasurer at Washington upon proper advices from any Assistant Treasurer that such deposit has been made. Deposits so made shall be subject to the orders of the Federal Reserve Board and shall be payable in gold coin or gol4 certificates on the order of the Federal Reserve Board to any Federal Reserve Bank or Federal Reserve agent at the Treasury or at the Subtreasury of the United States nearest the place of business of such Federal Reserve Bank or such Federal Reserve agent: Provided, however, That any expense incurred in shipping gold to or from the Treasury or Sub treasuries in order to make such payments, or as a result of making such payments shall be paid by the Federal Reserve Board and assessed against the Federal Reserve Banks. The order used by the Federal Reserve Board in making such payments shall be signed by the governor or vice governor, or such other officers or members as the Board may by regulation prescribe. The form of such order shall be approved by the Secretary of the Treasury. "The expenses necessarily incurred in carrying out these provisions, including the cost of the certificates or receipts issued for deposits received, and all expenses incident to the handling of such deposits shall be paid by the Federal Reserve Board and included in its assessments against the several Federal Reserve Banks. "Gold deposits standing to the credit of any Federal Reserve Bank with the Federal Reserve Board shall, at the option of said bank, be counted as part of the lawful reserve which it is required to maintain against outstanding Federal Reserve notes, or as a part of the reserve it is required to maintain against deposits. "Nothing in this section shall be construed as amending section six of the act of March fourteenth, nineteen hundred, as amended by the acts of March fourth, nineteen hundred and seven, and March second, nineteen hundred and eleven, and June twelfth, nineteen hundred and sixteen, nor shall the provisions of those acts be construed to apply to the deposits made or to the receipts or certificates issued under authority of this section." SEC. 7. That section seventeen be, and is hereby, amended so as to read as follows: "SEC 17. So much of the provisions of section fifty-one hundred and fifty-nine of the Revised Statutes of the United States and section four of the act of June twentieth, eighteen hundred and seventy-four, and section eight of the act of July twelfth, eighteen hundred and eighty-two, and of any other provisions of Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

836 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. existing statutes as require that before any national banking associations shall be authorized to commence banking business it shall transfer and deliver to the Treasurer of the United States a stated amount of United States registered bonds, and so much of those provisions or of any other provisions of existing statutes as require any national banking associations now or hereafter organized to maintain a minimum deposit of such bonds with the Treasurer is hereby repealed." SEC. 8. That section nineteen be further amended and reenacted so as to read as follows: "SEC. 19. Demand deposits within the meaning of this act shall comprise all deposits payable within thirty days, and time deposits shall comprise all deposits payable after thirty days, all savings accounts and certificates of deposit which are subject to not less than thirty days' notice before payment, and all postal savings IT 11^11 Uilo K/VV^IUUUII y \JX. UAX<7 XxX/MLJtll V UH manner ao ho may elect, tho cotabliohmont of a Federal Reserve Bank in any die trict, every subscribing member bank uEvery bank, banking association, or trust company which is or which becomes a member of any Federal Reserve Bank shall establish and maintain reserves reserve balances with its Federal Reserve Bank as follows: " (a) A bank If not in a reserve or central reserve city, as now or hereafter defined, it shall hold and maintain reserves equalft tft 9ttlilr"@r" jEa-its-vaults for a period of thirty six months after said dayo five twolftho thereof and permanently thereafter four twelfths. illLl LItlUUj UYVU UVVUllLllDj tlllvl 1U1 Utl"ll l3U.UUJJUU.lllg U1A. 1J.1UJ.11I.IIJ Mil tttXtJXLlUllztl UilU mancntly required. For a period thirty six months after said date tho balance of the reserves may be er-eeateal reserve cities as now defined by law. After said thirty six months' period said reserves, other than-those hercinbeforo Bank, shall be held in the vaults of the member bank or in the Federal Reserve Bank, or in both, at the option of the member bank with the Federal Reserve Bank of its district an actual net balance equal to not less than seven per centum of the aggre gate amount of its demand deposits and three per centum of its time deposits. "(b) A bank If in a reserve city, as now or hereafter defined, it shall hold and maintain reserves equal to fifteen per centum of the aggregate amount of its demand -'In its vaults for a period of thirty six months after said date, six fifteenths thereof, and permanently thereafter five fifteenths. feke-dafro aforesaid, at least three fifteenths, and for each succeeding six months aa be the amount permanently required. " For a period of thirty six months after said date the balance of the reserves may central reserve cities, as now defined by law. -• After said thirty six months' period all of said reserves, except those herein before required to be held permanently in the valuts of the member bank and in the Li^r-fcyl y-k-»»i-t J 13 rvr«yM4TT/^ t~i ft -n Ir ^nfill Vv ^ \r\ s^\ /-\ -• -n i 4-f-t Tmti H-n y\i» iy> 4- V\ s\ Xi^^\ f\ r\-tpc\ l T< i^rH^T*"*"7"*"* 1-f *•>-»^ ly I' UllUlUil ll/UUCI V O XJHJXll-j U11HX1 UU 11UX<A m 1UU VU/U1ULJ \JX JU UllU X LUvxai AV^DX VU XJUJXK or in both, at the option of -the member bank with the Federal Reserve Bank of its district an actual net balance equal to not less than ten per centum of the aggregate amount of its demand deposits and three per centum of its time deposits. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

RECOMMENDATIONS OF THE FEDERAL ADVISORY COUNCIL. 837 "(c) A- bank If in a central reserve city, as now or hereafter denned, it shall hold and maintain a rcocrvc equal to eighteen per centum of the aggregate amount of-its demand depooita and five per centum of ito time deposits, as follows-: "In its vaults, oix eighteenths thereof. " In-the- Federal Reserve Bank, seven eighteenths. -'The balance of said reserves shall be held in ito own vaults or in the Federal -Reserve Bank, at its option. -'Any Federal Reserve Bank may receive from the member banks as reserves not exceeding one half of each installment, cligible-papcr-fte-describedin-BeetieB: to-keep its reserve cither-in its own vaults or with-another State bank or- tras^esaofficially announced the establishment of a Federal Reserve Bank in the district in which--Buch State bank or trust company is situate.—Except as thus provided with the Federal Reserve Bank of its district an actual net balance equal to not less than thirteen per centum of the aggregate amount of its demand deposits and three per centum of its time deposits. "No member bank shall keep on deposit with any nonmember bank a sum in excess of ten per centum of its own paid-up capital and surplus. No member bank shall act as the medium or agent of a nonmember bank in applying for or receiving discounts from a Federal Reserve Bank under the provisions of this Act, except by permission of the Federal Reserve Board. The reserve 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 reserve balance required by law is fully restored. "In estimating the reserves balances required by this Act, the net bateee dif ference of amounts due to and from other banks shall be taken as the basis for ascer taining the baftk deposits against which reee?¥ee required balances with Federal Reserve banks shall be determined. Balaaees in reserve banks due te-membcr-banks shally to the c^teat herein provided, be counted as rcscrvcer "National banks, or banks organized under local laws, located in Alaska or in a dependency or insular possession or any part of the United States outside the con tinental United States may remain nonmember banks, and shall in that event maintain reserves and comply with all the conditions now provided by law regu lating them; or said banks, except in the-Philippme-fetods, may, with the consent of the Reserve Board, become member banks of any one of the reserve districts, and shall in that event take stock, maintain reserves, and be subject to all the other provisions of this act." Sec. 9. That that part of section twenty-two which reads as follows: "Other than the usual salary or director's fees paid to any officer, director, or employee of a member bank and other than a reasonable fee paid by said bank to such officer, director, or employee for services rendered to such bank, no officer, director, employee, or attorney of a member bank shall be a beneficiary of or receive, directly or indirectly, any fee, commission, gift, or other consideration for or in connection with any transaction or business of the bank," be, and hereby is, amended and reenacted so as to read as follows: Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

838 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. "Other than the usual salary or director's fee paid to any officer, director or em ployee, or attorney of a member bank, and other than a reasonable fee paid by said bank to such officer, director, or employee, or attorney for services rendered to such bank, no officer, director, employee, or attorney of a member bank shall be a benefi ciary of or receive, directly or indirectly, any fee, commission, gift, or other con sideration for or in connection with any transaction or business of the bank: Pro vided, however, That nothing in this act contained shall be construed to prohibit a di rector, officer, employee, or attorney from receiving the same rate of interest paid to other depositors for similar deposits made with such bank: And provided further, That notes, drafts, bills of exchange, or other evidences of debt executed or indorsed by directors or attorneys of a member bank may be discounted with such member bank on the same terms and conditions as other notes, drafts, bills of exchange, or evidences of debt upon the affirmative vote or written assent of at least three-fourths of the members of the board of directors of such member bank" Recommendation.—Resolved that the vice president of this council be requested to report to the Federal Reserve Board that the council has carefully considered the proposed amendments as presented to it by the Federal Reserve Board and that in view of changed conditions it revises its previous recommendations made in January (and formally approved at the council meeting in February) and approves of the board's proposed amendments to the Federal Reserve act with the exception of that to section 22. The council would again submit to the board its recommendation and proposed amendment to section 22, as follows: The council would recommend that the proposed addition to section 22 commenc ing with '' Provided, however, That nothing in this act contained '' should be amended as follows: li Provided, however, That nothing in this act contained shall be construed to pro hibit a director, officer, or employee from receiving the same rate of interest paid to other depositors for similar deposits made with such bank; or to prohibit a director who is not an officer or employee from receiving, directly or indirectly, the usual and customary commissions or fees for services rendered in buying and selling securities or other investments for or on account of such bank, but each such transaction must be recorded in the minutes of the meeting of said board, such minutes to specify the name of the director and the firm or corporation with which he is connected, if any, through which such order is executed, together with the amount of the fee or commis sion paid on each transaction; and, provided further that notes, drafts, bills of ex change, or other evidences of debt executed or indorsed by directors of a member bank may be discounted with such member bank on the same terms and conditions as other notes, drafts, bills of exchange or evidence of debt." The council makes this recommendation because in its judgment an affirmative vote or written assent of at least three-fourths of the members of the board is an unnec essary restriction in connection with such services by a director as the buying and selling of securities and inasmuch as notes, drafts, bills of exchange or other evidences of debt executed or indorsed by bank directors are as a rule the very best of their class, the placing of special restrictions on the discounting of such instruments for directors would only unnecessarily and unwarrantably impede legitimate business or force it into other banks. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

RECOMMENDATIONS OF THE FEDERAL ADVISORY COUNCIL. 839 TOPIC NO. 5. Bills S. 9 and S. 742. [S. 9, Sixty-fifth Congress, first session.] IN THE SENATE OF THE UNITED STATES. April 4,1917. A BILL To indemnify depositors in "member banks," as denned by the Federal Reserve act, against loss in the event of the failure or suspension of business of such bank. Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled, That to indemnify depositors in "member banks" as denned by the Federal Reserve act against loss and to make provision for the prompt payment to such depositors of the amounts due them in the event of the failure or suspension of business of such banks, there is hereby created a fund to be known as the depositors' indemnity fund, to be under the control and super vision of the Federal Reserve Board. Such fund shall consist of the proceeds of the tax on national-bank circulation beginning with January first, nineteen hun dred and fourteen, until the same accumulates to the extent of one per centum of the deposits of the member banks of the Federal Reserve Bank system, and thereafter if necessary to replenish the fund so that such fund shall at all times be not less in amount than one per centum of the average annual deposits of all the member banks of the Federal Reserve Bank system in the United States for the preceding calendar year, such average annual deposits to be computed by adding together the total deposits of all member banks as stated in their several reports of condition made during said calendar year and dividing the aggregate sum by the number of reports of condition so made. For the purposes of this act the indemnified deposits shall be construed to mean and include all liabilities of a bank excepting capital, surplus, unpaid dividends, circulation, and United States deposits, and depositors shall be construed to mean and include all persons to whom such liabilities are due. Whenever any member bank shall fail to meet its obligations to depositors and close its business or its business shall be suspended, the Federal Reserve Board shall provide for the immediate payment out of the depositors' indemnity fund of all sums due by such member bank to its depositors, and thereupon such fund shall become and be subrogated to all the rights of said depositors, and in the settlement of the affairs of any such bank all dividends that would have been due to such depositors shall be paid into such fund. The Federal Reserve Board is fully authorized and empowered to promulgate and enforce any and all needful rules and regulations for carrying out the purposes of this act and administering and conserving the fund hereby created. [S. 742, Sixty-fifth Congress, first session.] IN THE SENATE OF THE UNITED STATES. April 6, 1917. A BILL To found and maintain a mutual insurance fund for depositors in national banks, to be kept available in the United States Treasury and to be administered by a bureau in the Treasury Depart ment organiz ed and regulated for that purpose. Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled, That there is hereby created in connection with the national banking system a department in the office of the Comptroller of the Currency to be known as the Depositors' Insurance Department, over which the Comptroller of the Currency shall have full supervision and management, as provided in this act. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

840 ANNUAL REPORT OE THE FEDERAL RESERVE BOARD. He shall receive and disburse all moneys paid in and belonging to the several funds herein provided for and shall keep suitable books, in which shall be J^ept an account known as the reserve fund and an account to be known as the premium fund. He shall also keep a separate account with each national bank in which he shall credit said bank with all moneys paid by it to the account of said Depositors' Insur ance Department and shall debit it with its proportionate share of losses paid from said insurance funds. He shall also keep such other accounts as may by him be deemed necessary and shall have power and authority to appoint such deputies, assistants, and clerks as may be necessary to carry into effect the purposes of this act. All the expenses of this department shall be paid by and charged to the premium fund. SEC. 2. That the Comptroller of the Currency shall invest the money received through the reserve fund in interest-bearing bonds of the United States or may there with purchase or at maturity pay such bonds, replacing their value in the reserve fund with United States Treasury notes: Provided, That any national bank may, in lieu of cash payment of its one per centum reserve fund dues, deliver to the Comp troller of the Currency bonds of the character above described, at par value, to be approved by him. The interest on all bonds in the reserve fund shall be collected by the Comptroller of the Currency when due and remitted to the national banks proportionately to the amounts paid by them; or, in case of national banks that have deposited their own bonds, the interest on such bonds as they may have to their credit shall be collected and forwarded to them. The remitting of interest to national banks shall be made at the end of each fiscal year. SEC. 3. That the Comptroller of the Currency may deposit with the Secretary of the Treasury any surplus money in the premium fund; or, in case such surplus should accumulate beyond the requirement of the department, he may invest the same in interest-bearing bonds of the United States, as provided by the investment of the reserve fund, the interest derived therefrom to be credited to the premium fund. SEC. 4. That the comptroller shall make an annual report to the Congress of the United States at the commencement of each regular session thereof setting forth therein a full statement of the affairs of the Depositors' Insurance Department for the previous fiscal year and shall make such recommendation as he may believe would tend more fully to carry into effect the intent and purposes of this act. SEC. 5. That every national bank shall, within thirty days after this act takes effect or when it shall be organized any time thereafter, file with the Comptroller of the Currency a report showing its capital and total deposits; and at the beginning of each fiscal year thereafter it shall file with the Comptroller of the Currency a report showing its capital and average deposits for the preceding year. SEC. 6. That all national banks having deposits in an amount greater than their capital when this act takes effect shall pay to the Comptroller of the Currency within thirty days after this act becomes operative, one-half of one per centum on its total deposits, which shall be credited to the reserve fund, and one mill on its total deposits, which shall be credited to the premium fund. At the beginning of each fiscal year thereafter every national bank shall pay to or receive from the Comptroller of the Currency one-fourth of one per centum on its average deposits of the preceding year, which amount shall be credited or charged to the reserve fund, and shall also pay one mill on its average deposits of the pre ceding year, which amount shall also be credited to the premium fund. SEC. 7. That all national banks having less deposits than capital when this act takes effect shall pay to the Comptroller of the Currency, when this act becomes operative, one per centum on their capital, which shall be credited to the reserve fund, and one mill on their capital, which shall be credited to the premium fund. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

RECOMMENDATIONS OF THE FEDERAL ADVISORY COUNCIL. 841 If at the beginning of the following year the deposits should still be less than the capital, then so much of the one mill premium dues paid in the previous year shall be refunded as may be found overpaid on that bank's proportionate share of its average deposits for the previous year, and shall pay for the current year one mill into the premium fund on its average deposits of the preceding year and every year thereafter until such deposits shall exceed the capital, the reserve fund dues paid in the previous year to remain the same so long as the deposits do not exceed the capital. If, however, the average deposits during the previous year shall have exceeded the capital, then it shall pay on its average deposits one per centum into the reserve fund and one mill into the premium fund, and shall further pay for the current year on its average deposits of the preceding year one mill into the premium fund; thereafter it shall be subject to the same provision as applied to banks in paragraph six. SEC. 8. That all national banks organized at any time after this act takes effect which have been organized or converted from or consolidated with any other bank ing association and have deposits in an amount greater than the capital so organized shall be subject to the same provisions as apply to national banks in paragraph six excepting that only such a proportion of the one mill premium fund dues shall be paid as the unexpired time from the date of organization to the end of a fiscal year shall bear to a whole year, and that payment of dues shall be made at the time when the bank is authorized to do business. SEC. 9. That any national bank organized at any time after this act takes effect and having less deposits than its capital when so organized shall be subject to the same provisions as apply to national banks in paragraph seven, excepting that pay ment of dues shall be made when the bank is authorized to do business. SEC. 10. That whenever a national bank's total deposits at the beginning of a fiscal year exceeds ten times its capital, and if its average deposits for a whole pre ceding year has exceeded ten times its capital, then it shall on the beginning of said fiscal year increase r}s capital to such an amount that the average deposits of the preceding year shall not exceed ten times its capital or else reduce its deposits so that they will not exceed ten times its capital. SEC. 11. That after a receiver has been appointed for a failed bank and has been in the discharge of his duties for thirty days, such receiver shall make and trans mit to the Comptroller of the Currency a statement showing the deposit liabilities of such failed bank, the assets thereof as he may be able to determine, and the assets then available for the payment of the first dividend to depositors; and if the amount so available shall not be sufficient to pay a dividend equal to or greater than one hundred per centum of the total deposits of such failed bank, then the Comptroller of the Currency shall transmit to said receiver such amounts from the premium fund as shall enable said receiver to pay forthwith each depositor on proved claims a dividend of one hundred per centum of his claim. In case the premium fund shall be insufficient, then the reserve fund shall be drawn upon for the amount required to pay all depositors ninety per centum of their claims, and said reserve fund shall be reimbursed therefor as soon as the premium fund shall have accumulated a surplus beyond its needs. All the amounts so ad vanced by the Comptroller of the Currency to the receiver shall remain a first lien on the remaining assets of said failed national bank in favor of said Depositors' Insurance Department. The receiver shall from time to time transmit to the Comp troller of the Currency all the proceeds which may be derived from the remaining assets up to the amount so advanced, and all such sums so transmitted shall be credited to the funds taken from. The remaining assets of such failed national banks after such lien shall have been satisfied, if any there may be, shall be admin istered by the receiver for the benefit of the creditors thereof. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

842 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. SEC. 12. That any national bank which shall go out of business and which shall have paid its depositors in full shall receive from the Comptroller of the Currency such an amount as shall stand to its credit after having charged against it all its proportionate share of losses sustained in the Depositors' Insurance Department up to the time of its retirement. A bank's proportionate share of loss shall be such part of the losses sustained as its average deposits may have borne to the aggregate deposits in all banks for the same period and as reported to the Comptroller of the Currency. SEC 13. That deposits, within the meaning of this act, shall be construed to mean all liabilities of a bank excepting capital, surplus, undivided profits, unpaid divi dends, circulation of said bank, and United States deposits. SEC. 14. That the average deposits of a bank shall be ascertained by adding to gether the total deposits as stated in the several reports of the bank submitted to the Comptroller of the Currency and dividing the sum total by the number of reports so made, or, if for shorter periods, then by the number of days. SEC. 15. That a fiscal year, within the meaning of this act, shall be construed to mean an entire year from and after this act takes effect and each entire year there after. SEC. 16. That all acts or parts of acts inconsistent with this act are hereby repealed, and nothing herein contained shall affect existing rights of banks which have failed prior to the time this act shall take effect. Recommendation.—The council has considered bills S. 9 and S. 742 at the request of the Federal Reserve Board and begs to report that in its opinion any legislation providing for the guaranteeing of depos its or the establishment of a fund for the insurance of deposits is undesirable. A plan might, however, be devised by the Federal Reserve Board which would provide for prompt relief to be given depositors of failed banks. The council does not approve of legisla tion regulating the ratio of deposits to capital as proposed in section 10 of S. 742. The following members of the Federal Advisory Council were pres ent at this meeting: Vice President L. L. Rue in the chair, J. P. Morgan, D. G. Wing, W. S. Rowe, J. W. Norwood, C. A. Lyerly, F. O. Watts, J. R. Mitchell, E. F. Swinney, T. J. Record, H. Fleishhacker, and Merritt H. Grim, secretary. Recommendations of the Federal Advisory Council to the Federal Reserve Board September 18, 1917. TOPIC NO. l. The effect of the pending bond issue upon our general financial situation, the policy that the Federal Reserve Banks should pursue as to reserves against deposits and note issues, discount rates. Recommendation.—The temporary effect of the pending Govern ment bond issue upon the general financial situation will be to dis locate bank deposits. The effort to be made to place the bonds with small investors will also to a considerable extent encroach on savings deposits. As this loan will come on the market at the season Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

RECOMMENDATIONS OF THE FEDERAL ADVISORY COUNCIL. 843 when, in connection with the movement of crops, the greatest expan sion of bank credit usually takes place the banks, especially at the centers, will need the assistance of the Federal Reserve Banks in the shape of short loans or rediscounts to a greater extent than they did in connection with the former issue. As the money received by the Government for the bonds is redisbursed and returns to the banks through the channels of commerce the financial situation will gradually adjust itself to the new condi tions created by the flotation of such a large issue of bonds. Bank credits will likely be still further expanded, resulting in increased deposits and loans. In anticipation of these conditions the Federal Reserve Banks should pursue a policy of conservation of their reserves against deposits and note issues. For this purpose, while they should meet liberally the temporary requirements of member banks for the purpose of putting through the Government bond issue, any undue expansion thereafter of a more or less permanent nature should be curbed and controlled by the Federal Reserve Banks' discount rates; for the protection of their reserves the Federal Reserve Banks should raise their discount rates whenever occasion calls for such action. These banks should be kept in a strong position not only in the interests of further Government financing but to prevent any undue expansion of credit by their member banks through the discount facilities afforded them. TOPIC NO. 2. General discussion of the foreign exchange situation: To what extent can this country continue to give credits to the nations with which it is associated in the war which normally send us gold in settlement of trade balances due us, and continue to ship gold to those neutral nations to which we may be indebted? What restrictions, if any, are necessary upon our imports to offset the embargoes on exports? Recommendation.—The council has nothing on which to base a definite opinion as to what extent this country can continue shipments of gold to neutral countries while itself advancing money to meet the requirements of the countries associated with us in the war. It seems to us that the shipments of gold are a part of the contribu tion which we are making to these countries, being part of our advances to them, for the prosecution of the war. To what extent this can be continued without unduly impairing our resources it is difficult to tell, but there is no question that if such action tends to shorten the war or to enable the associated nations to win it this country should not hesitate even to impair its resources for the pur pose of accomplishing that object. As the war may be prolonged it may be necessary in conjunction with the other nations associated with us to endeavor to prevent the arbitrage of exchange as far as Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

844 ANNUAL KEPORT OF THE FEDERAL RESERVE BOARD. possible. In that connection we have read with great interest the report of the informal committee made to the Secretary of the Treasury on September 13, 1917, and heartily approve of their suggestions. The council views with great satisfaction the increase of the gold resources of the Federal Reserve system and hopes that no steps will be omitted to increase and hasten the mobilization of the gold of the country in the Federal Reserve Banks. Great discretion, however, must be used in the methods applied so as not to create alarm which may lead to the hoarding of gold and its consequent demobilization. We note with satisfaction that the President by proclamation has placed with your Board the control of gold exports. This will insure the handling of such transactions with the discretion so necessary to avoid public alarm. TOPIC NO. 3. Loss on Gold Abrasion (suggested by Governor Harding). Recommendation.—Inasmuch as it is of paramount importance that the gold now in circulation should be mobilized in the Federal Reserve Banks which to some extent is prevented because of the existence of light weight gold in circulation we think the Federal Reserve Banks would be justified in assuming the loss by abrasion on such of this gold as is offered to them on deposit within a reason able, specified time. Additional recommendation.—Whereas under section four of H. R. 5901 (in the Senate of the United States, Calendar No. 121, September 13, 1917, pages 7 and 8) the following language occurs: In any case of the issue of a series of convertible bonds, if a subsequent series of bonds (not including United States certificates of indebtedness, war savings cer tificates, and other obligations maturing not more than five years from the issue of such obligations, respectively) bearing interest at a higher rate shall under the authority of this or any other act, be issued by the United States before the termina tion of the war between the United States and the Imperial German Government, then the holders of such convertible bonds shall have the privilege, at the option of the several holders, at any time within such period, after the public offering of bonds of such subsequent series, and under such rules and regulations as the Secretary of the Treasury shall have prescribed, of converting their bonds, at par, into bonds bearing such higher rate of interest at such price not less than par as the Secretary of the Treasury shall have prescribed. Resolved, That this council is of the opinion that prior to the issue of these bonds it is essential that the Secretary of the Treasury should state definitely all the terms connected with them, including the price, at which any future issues bearing a higher rate of interest will be exchanged for them. Additional Recommendation.—In our opinion it may be necessary for the successful administration of the Food Administration Grain Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

RECOMMENDATIONS OF THE FEDERAL ADVISORY COUNCIL. 845 Corporation that the limit placed on loans by National Banks by Section 5200 U. S. R. S. should not apply to loans to this Corporation. This Corporation being owned b}^ the United States Government, loans to it may properly be classified as loans to the United States Government and therefore not subject to the limitation of the law. We would recommend that an early ruling to this effect should be made and promulgated by the proper authorities. If this is not possible under existing law we recommend that the law should be amended. The following members of the Federal Advisory Council were present at this meeting: Daniel G. Wing, J. P. Morgan, L. L. Rue, W. S. Rowe, J. W. Norwood, Charles A. Lyerly, James B. Forgan, F. O. Watts, John R. Mitchell, E. F. Swinney, T. J. Record, Herbert Fleishhacker and Merritt H. Grim, Secretary. MEMORANDUM ON INTERNATIONAL EXCHANGE FOR INFORMATION OF THE SECRETARY OF THE TREASURY. The informal committee which met today to discuss the subject of international exchange begs to submit the following memorandum of its views: The committee consists of the following gentlemen: Mr. Benjamin Strong, Mr. J. E. Gardin, Mr. J. E. Rovensky, Mr. Albert Strauss, Mr. D. G. Wing, Mr. James Brown, Mr. J. F. Curtis. GENERAL POLICY. The committee recommends that an announcement be made by the Secretary of the Treasury to the effect that while there will be no hinderance on the export of gold, silver, or currency for legitimate purposes arising out of commercial transactions, as limited by a proper regard for war conditions, all applications for the export of coin, bullion or currency will be subjected to close scrutiny, to the end that such exports shall be made only when compatible with the public interests. The committee recommends that upon the passage of the Trading with the Enemy Bill, imports into this country be so regulated as to curtail the importation of luxuries and other articles not essential for the public welfare. Such control forms a necessary step in the proper regulation of exchange, and will automatically reduce the demand for the export of gold; but it can be ultimately effective only if similar control is exercised by our Allies in cooperation with us. The committee is informed that considerable amounts of gold and gold certificates are being carried from the country by individual travellers and by steamship officials; and it is suggested that due consideration be given to this aspect of the situation. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

846 ANNUAL KEPORT OF THE FEDERAL RESERVE BOARD. MACHINERY FOR REGULATION. The committee recommends that committees be appointed in each Federal reserve district, to serve under the general direction of the Federal Reserve Board. These committees should examine into all financial transactions between residents of this country and residents of foreign countries, American financial transactions between foreigners, and financial operations that may appear to be incompatible with the public interests. Under the supervision of such committee only such concerns as shall be licensed shall be permitted to conduct foreign exchange transactions, and they should be required to report daily to the com mittee all operations for and between all foreign accounts; such reports to include a statement of all credits and debits to such account, with full details, giving names of individuals affected; also the sale and transfer of securities for foreign account and any other informa tion that in the opinion of the committee may be necessary. All dealers in international exchange should be required to obtain from their customers full information as to the details of all transactions to be reported. Every resident within each district (whether or not a licensed dealer in foreign exchange) should be required to report to the committee the amounts due from enemies or allies of enemies, and also all property owned by him in enemy or ally of enemy coun tries; also all property held in any way, directly or indirectly, for enemy account or allies of enemy account. Every member of a committee should take an oath at the time of qualification to the effect that he will not use for personal advantage, directly or indirectly, any information acquired as a member of the committee, nor reveal any information obtained by him in that capacity except to the proper officials. The central organization should work in close cooperation with the export and import commissions as soon as appointed and the similar foreign exchange organizations of our allies, and should have the benefit of all information acquired through the Departments of State, Justice, and Commerce, the censorship of the mails, cables, and telegraphs, and all other available governmental agencies. The appropriation for the expenses of administering this section of the law should be increased to $350,000. The propriety of charging nominal fees for licenses to deal in international exchange should be considered. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

RECOMMENDATIONS OF TEE FEDERAL ADVISORY COUNCIL. g47 METHOD OF CONTROLLING INTERNATIONAL EXCHANGE. The committee is unanimously of the opinion that the quotation for the pound sterling in the United States should not be allowed to decline, as such a decline, apart from the moral damage to the cause of the allies, would, without relieving the United States, place an additional burden upon its allies in the increased cost to them of commodities purchased in other markets; but this end must be accomplished in cooperation with the allies and without any material diminution of the gold supply of the United States, which must, in the interest of the other allies, as well as of the United States, be retained here as a basis for our important credit operations. The committee is also of the opinion that if demands on the United States for gold for shipment to other countries are not promptly con trolled through an agreement with our allies concerning the trade underlying these transactions, the only effective method of controlling the export of gold will be through restriction or prohibition of arbi trage operations. The effect of such restriction or prohibition will be to limit exchange transactions between the United States and foreign countries to such direct operations as are necessary to liqui date the direct trade between each country and the United States. Any hardships which may be involved in this procedure would be mitigated if banks in foreign countries which are unfavorably affected by these measures would employ their funds in loans or investments in this country instead of exacting gold. In this connection, steps must be taken to prohibit our own banks for the future from earmarking gold or taking it into custody. Such earmarking or custody has in every respect the same effect as ex portation; and it may be advisable to ask all banks to state, for the confidential use of the Government, what amounts they have ear marked or held in custody at this time and for whom, and to report any future applications to earmark or hold in custody. SILVER FOR SUBSIDIARY COINAGE AND FOR EXPORT. The committee recommends that the silver now lying inert in the Treasury for the redemption of silver certificates be rendered avail able for use through the redemption of silver certificates and the substitution in their place of Federal Reserve notes. The silver bullion so released should be used so far as required for subsidiary coinage, and the balance will be available for export in place of gold. Silver certificates to the amount of about $456,000,000 are now outstanding. The result of such steps will be the permanent substitution of gold Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

848 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. country in substitution for gold which is urgently required. Legis lation will probably be required to accomplish this. Steps must also be taken to expedite the printing of small bills by the Bureau of Engraving and Printing. Respectfully, BENJ. STRONG. D. G. WING. JOHN E. ROVENSKY. JOHN E. GARDIN. . ALBERT STRAUSS. JAMES BROWN. J. F. CURTIS. WASHINGTON, September 13, 1917. Recommendations of the Federal Advisory Council to the Federal Reserve Board, November 20, 1917. DISCOUNTS AND INVESTMENTS. TOPIC NO. 1. Should member banks make a practice of discounting their own acceptances? Recommendation.—While it may not be considered as being in accord with best banking principles for a bank to purchase its own acceptances and carry them as an investment, nevertheless until a wider discount market is developed, which is most desirable, it may be at times necessary for a bank to purchase its own acceptances for the protection of its customers. TOPIC NO. 2. Suspension of commodity rates and reasons therefor. Recommendation.—The council does not believe there is any neces sity for a preferential rate for the rediscount of so-called commodity paper. TOPIC NO. 3. Is it desirable and necessary that preferential rates be established for customers' paper running not longer than ninety days, which is secured entirely by United States bonds or Treasury certificates? Recommendation.—To facilitate Government financing we believe it desirable that there should be a preferential rate established for customers' paper running not longer than ninety days which is secured entirely by United States bonds or Treasury certificates. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

RECOMMENDATIONS OF THE FEDERAL ADVISORY COUNCIL. 849 TOPIC NO. 4. General discussion of assistance to banks and savings banks especially in carrying investments in railroad and corporate bonds, (a) What means, if any, are there of affording adequate relief under the present law? Recommendation.—The present law does not permit any relief by granting loans to savings banks against the security of railroad and corporate bonds. (b) Should the Federal Reserve Act be amended so as to permit the rediscount by Federal Reserve Banks of notes secured by bonds of railroad or industrial cor porations? Recommendation.—It is our opinion that the Federal Reserve Act should not be amended so as to permit the rediscount of notes se cured by bonds of railroads or industrial corporations, as such amendment would be contrary to the spirit and intent of the act as expressed in its title: uAn act to provide for the establishment of Federal Reserve Banks, to furnish an elastic currency, to afford means of rediscounting commercial paper, to establish a more effective supervision of banking in the United States, and for other purposes." (c) Discussion of an alternative plan. Recommendation.—It may be desirable to have enabling legislation to provide for the necessary financing of railroads, public-utility cor porations, and savings banks, either directly or indirectly, by the United States Government during the duration of the war and under the supervision of a Federal commission. CAPITAL AND RESERVE REQUIREMENTS, TOPIC NO. 5. Should the Federal Reserve Act be amended so as to allow State banks which were in existence on November 16, 1914, to become members of the Federal Reserve system, although their capital be less than national-bank requirements? Recommendation.—We think it inadvisable so to amend the law. TOPIC NO. 6. Should the Board be given authority to exempt from the reserve requirements im posed upon banks in reserve and central reserve cities, banks not located in the business centers whose business is largely local, and which do not receive accounts from other banks? NOTE.—The Board has received numerous requests that it ask Congress to modify the existing law in the manner above indicated, but so far has reached no conclusion in the matter. What would the council advise ? Recommendation.—We think it undesirable that there should be any distinction made in regard to reserve requirements of banks 100823°—19 54 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

850 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. located in central reserve or reserve cities simply because some of them are not located in the business centers of these cities. We believe, however, that sooner or later the basis on which reserve requirements are established should be changed and should be deter mined by the character of deposits carried by the various banks under such classifications as bank deposits, commercial deposits, and time deposits. We think, however, it is inadvisable that any legislation looking to this change should be asked for under present conditions. GOLD EMBARGO, NOTE.—The Board has been charged with the duty of advising the Treasury in matters relating to foreign exchange, and to exporta tion of gold, and it would like to have the opinion of the council in the following matters: TOPIC NO. 7. To what extent, and for what purposes should gold be released for shipment to other countries? Recommendation.—Gold should not be released for shipment to other countries except in sufficient quantities to settle unfavorable trade balances against us before the dollar exchange in the foreign country falls to a level low enough to increase intolerably the cost to us of the principal commodities imported by us from that country. Imports should be restricted to such as are necessary for carrying on the war and exports should be facilitated in every possible way. TOPIC NO. 8. Should the stabilization of sterling exchange by purchases of sterling bills in this country be continued? Recommendation.—Yes. TOPIC NO. 9. Should any attempt be made to stabilize dollar exchange in countries of continental Europe, such as Sweden, Holland, Switzerland, and Spain? Should an effort be made to bring the dollar back to its parity in South American countries? Recommendation.—It is very desirable to make such arrangements as are possible that do not involve the undue shipment of gold. TOPIC NO. 10. Exchange relations with Canada. Should unrestricted shipments of gold to Canada be permitted, or if limited, what arrangements can be made to continue normal trade relations with Canada and to facilitate the movement of Canadian crops? Recommendation.—The council makes no recommendation, as it is informed that exchange relations with Canada are in process of satis factory adjustment. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

BECOMMENDATIOSTS OF THE FEDERAL ADVISORY COUNCIL. 851 TREASURY CERTIFICATES OF INDEBTEDNESS. TOPIC NO. 11. What means should be availed of to secure a more general distribution of Treasury certificates of indebtedness? Recommendation.—The market for Treasury certificates is con stantly broadening and we think it inadvisable and unnecessary that any special steps be taken to force their distribution among the banks. Additional recommendation.—Now that the financing of the Second Liberty Loan is effected it is our opinion that discount rates should be increased and we would recommend that the current rates be increased one-half of one per cent in each of the various classifica tions of paper discounted or purchased by the Federal Reserve banks. The following members of the Federal Advisory Council were pres ent at this meeting: Daniel G. Wing, J. P. Morgan, L. L. Rue, W. S. Rowe, J. W. Norwood, Charles A. Lyerly, James B. Forgan, F. O. Watts, John R. Mitchell, E. F. Swinney, Herbert Fleishhacker, and Merritt H. Grim, secretary. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

RECOMMENDATIONS OF THE FEDERAL ADVISORY COUNCIL TO THE FEDERAL RESERVE BOARD FOR THE YEAR 1918. Recommendations of the Federal Advisory Council to the Federal Reserve Board, February 19, 1918. TOPIC NO. l. Reserves to be carried by member banks in Federal Reserve Banks. Recommendation.—While the present system of requiring reserves of 13 per cent in central reserve cites, 10 per cent to be carried bybanks in reserve cities, and 7 per cent to be carried by so-called country banks may not be scientific and may work an injustice to some cities, nevertheless it is the opinion of the council that during the existence of the war and while the whole banking system of the country is being subjected to unusual strain, it would be unwise to attempt any legislation looking to a change in reserves to be carried by member banks. The subject should have the close attention of the Federal Reserve Board and the Federal Advisory Council, so that when matters become normal the necessary legislation may be obtained to correct any inequalities and inconsistencies. TOPIC NO. 2. Discount rates. Recommendation.—There appears to be no immediate necessity to change the discount rates of the Federal Reserve Banks. How ever, an increasing tendency for rediscounts is likely to develop and it will probably be necessary to increase the rates of discount later on in order to protect the reserves of the Federal Reserve Banks. The council is, however, of the opinion that a preferential rate should continue to be accorded to loans secured by Liberty bonds. TOPIC NO. 3. Interest on third Liberty loan. Recommendation.—With the outstanding 4 per cent Liberty bonds selling on the market from three to four points below par, it would not seem possible to successfully place a new loan at the same rate. It is the opinion of this council that the next Liberty loan should be a short term taxable 4^ per cent bond, as the Government must more nearly approach the market value of money if it would sue- 852 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

RECOMMENDATIONS OF THE FEDERAL ADVISORY COUNCIL. 853 cessfully place new issues of bonds. The country generally, we believe, expects a bond bearing 4| per cent interest and the effect of the increase has been discounted. TOPIC NO. 4. Priorities in capital and bond issues. Recommendation.—The council approves of the supervision of capital and bond issues, as it is essential that private and corporate enterprises should not absorb the credit power of the country to the detriment of the Government's necessities, the latter being paramount. TOPIC NO. 5. What steps, if any, may be properly undertaken in limiting commercial credits? Recommendation.—It is the opinion of this council that the proper limiting of commercial credits would be aided if cautionary communi cations are sent to the various Federal Reserve Banks by the Federal Reserve Board, bringing to their attention the desirability of the member banks curtailing the extension of all credits not necessary to the conduct of the war. AMENDMENTS TO THE FEDERAL RESERVE ACT. TOPIC NO. 6. War Finance Corporation bill. Recommendation.—The council is of opinion that the assistance contemplated in the War Finance Corporation bill is a public neces sity at this time, and that legislation should be enacted granting such relief. TOPIC NO. 7. Amending section 4. Be it enated by the Senate antf House of Representatives of the United States of America in Congress assembled, Section I: That section 4 of the act approved December 23, 1913, known as the Federal Reserve Act, be amendded and reenacted by striking out that part of such section which reads as follows: ''Directors of Class A and Class B shall be chosen in the following manner: '' The chairman of the board of directors of the Federal Reserve Bank of the district in which the bank is situated or, pending the appointment of such chairman, the organization committee shall classify the member banks of the district into three general groups or divisions. Each group shall contain as nearly as may be one-third of the aggregate number of the member banks of the district and shall consist, as nearly as may be, of banks of similar capitalization. The groups shall be designated by number by the chairman. "At a regularly called meeting of the board of directors of each member bank in the district it shall elect by ballot a district reserve elector and shall certify his name to the chairman of the board of directors of the Federal Reserve Bank of the district. The chairman shall make lists of the district reserve electors thus named by banks in each of the aforesaid three groups and shall transmit one list to each elector in each group. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

854 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. "Each member bank shall be permitted to nominate to the chairman one candi date for director of Class A and one candidate for director of Class B. The candi dates so nominated shall be listed by the chairman, indicating by whom nomi nated, and a copy of said list shall, within fifteen days after its completion, be fur nished by the chairman to each elector. "Every elector shall, within fifteen days after the receipt of the said list, certify to the chairman his first, second, and other choices of a director of Class A and Class B, respectively, upon a preferential ballot, on a form furnished by the chairman of the board of directors of the Federal Reserve Bank of the district. Each elector shall make a cross opposite the name of the first, second, and other choices for a director of Class A and for a director of Class B, but shall not vote more than one choice for any one candidate;" and by substituting therefor the following: " Directors of Class A and Class B shall be chosen in the following manner: " The Federal Reserve Board shall classify the member banks of the district into three general groups or divisions, designating each group by number. Each member bank shall be permitted to nominate to the chairman of the board of directors of the Federal Reserve Bank of the district one candidate for director of Class A and one candidate for director of Class B. The canditates so nominated shall be listed by the chairman, indi cating by whom nominated, and a copy of said list shall, within fifteen days after its completion, be furnished by the chairman to each member bank. Each member bank by a resolution of the board or by an amendment to its by-laws shall authorize its president, cashier, or some other officer to cast the vote of the member bank in the elections of Class A and Class B directors. u Within fifteen days after receipt of the list of candidates the duly authorized officer of a member bank shall certify to the chairman his first, second, and other choices for director of Class A and Class B, respectively, upon a preferential ballot upon a form fur nished by the chairman of the board of directors of the Federal Reserve Bank of the dis trict. Each such officer shall make a cross opposite the name of the first, second, and other choices for a director of Class A and for a director of Class B, but shall not vote more than one choice for any one candidate." Recommendation.—The council approves this amendment. TOPIC NO. 8. Amending section 16, ninth paragraph. , SEC. 3. That the ninth paragraph of section 16 of the Federal Reserve Act, as amended by the acts approved September 7, 1916, and June 21, 1917, be further amended and reenacted so as to read as follows: "In order to furnish suitable notes for circulation as Federal Reserve notes, the Comptroller of the Currency shall, under the direction of the Secretary of the Treas ury, cause plates and dies to be engraved in the best manner to guard against coun terfeits and fraudulent alterations, and shall have printed therefrom and numbered such quantities of such notes of the denominations of $5, $10, $20, $50, $100, $500, $1,000, $5,000, $10,000 as may be required to supply the Federal Reserve Banks. Such notes shall be in form and tenor as directed by the Secretary of the Treasury under the provisions of this act and shall bear the distinctive numbers of the sev eral Federl Reserve Banks through which they are issued." Recommendation.—The council approves this amendment. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

RECOMMENDATIONS OF THE FEDERAL ADVISORY COUNCIL. 855 TOPIC NO. 9. Amending section 19, paragraphs (b) and (c). SEC. 4. That paragraphs (b) and (c) of section 19 of the Federal Reserve Act, as amended by the acts approved August 15, 1914, and June 21, 1917, be further amended and reenacted to read as follows: "(b) If in a reserve city, as now or hereafter defined, it shall hold and maintain with the Federal Reserve Bank of its district an actual net balance equal to not less than ten per centum of the aggregate amount of its demand deposits and three per centum of its time deposits: Provided, however, That if located in the outly ing districts of a reserve city or in territory added to such a city by the extension of its corporate charter, it may, upon the affirmative vote of four members of the Federal Reserve Board, hold and maintain the reserve balances specified in paragraph (a) hereof "(c) If in a central reserve city, as now or hereafter defined, it shall hold and maintain with the Federal Reserve Bank of its district an actual net balance equal to not less than thirteen per centum of the aggregate amount of its demand deposits and three per centum of its time deposits: Provided, however, That if located in the outlying districts of a central reserve city or in territory added to such city by the extension of its corporate charter, it may, upon the affirmative vote of four members of the Federal Reserve Board, hold and maintain the reserve balances specified in para graphs (a) or (b) hereof " Recommendation.—The council does not approve of the proposed amendment at this time, believing that this change should be taken up in connection with the whole subject of the readjustment of reserves at some later date, and would respectfully refer to their recommendation on Topic No. 1 herewith. TOPIC NO. 10. Amending section 25 (a). SEC. 6. That section 25 of the Federal Reserve Act be amended and reenacted by adding thereto the following: (a) Banking corporations to be organized for the purpose of engaging principally in international or foreign banking, or banking in a dependency or insular pos session of the United States, either directly or through the agency, ownership, or control of local institutions in foreign countries, or in such dependencies or insular possessions as provided by this section, and to act when required as fiscal agents of the United States, may be formed by any number of natural persons, not less in any case than five. Such persons shall enter into articles of association, which shall specify in general terms the object for which the association is formed, and may contain any other provisions not inconsistent with law which the association may see fit to adopt for the regulation of its business and the conduct of its affairs. These articles shall be signed by the persons uniting to form the association, and a copy of them shall be forwarded to the Federal Reserve Board to be filed and preserved wdth its records. The persons uniting to form such association shall, under their hands, make an organization certificate, which shall specifically state: (1) The name assumed by such association, which name shall be subject to the approval of the Federal Reserve Board; (2) The place or places where its operations are to be carried on; (3) The place in the United States where its home office shall be located; (4) The amount of its capital stock and the number of shares into which the same shall be divided; Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

856 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. (5) The name and places of residence or of business of the shareholders and the number of shares held by each of them ; (6) The fact that the certificate is made to enable such persons to avail themselves of the advantages of this section. The organization certificates shall be acknowledged before a judge of some court of record or a notary public and shall be, together with the acknowledgment thereof, authenticated by the seal of such court or notary, and transmitted to the Federal Reserve Board, which shall record and carefully preserve the same in its business. Upon duly making and filing articles of association and organization as provided in this section the corporation shall become as from the date of its execution of its organ ization certificate a body corporate and as such and in the name designated, in th3 organization certificate it shall have power under such conditions and regulations as the Federal Reserve Board may prescribe— First. To adopt and use a corporate seal. Second. To have succession for a period of twenty years from its organization un less sooner dissolved by an act of Congress or unless its franchises shall become for feited by some violation of law. (3) To make contracts; (4) To sue and be sued, complain and defend in any court of law or equity as fully as natural persons; (5) To elect or appoint directors, a majority of whom shall be citizens of the United States and by its board of directors to appoint such officers and employees as they may deem proper, define their duties, require bonds of them, and fix the penalty thereof, dismiss such officers or employees, or any of them, at pleasure, and appoint others to fill their places. (6) To prescribe by its board of directors by-laws not inconsistent with law and the regulations of the Federal Reserve Board, regulating the manner in which its stock shall be transferred, its directors elected or appointed, its officers and employ ees appointed, its property transferred, its general business conducted, and the privileges granted to it by law exercised and enjoyed. (7) To purchase and sell or discount and negotiate notes, drafts, checks, bills of exchange, acceptances, cable transfers, or other evidences of debt; to purchase and sell securities including securities of the United States or any State in the Union; to accept bills or drafts drawn upon it subject to such limitations and restrictions as may be imposed by the Federal Reserve Board; to purchase and sell exchange, coin, and bullion; to borrow and to lend money on real or personal security; to receive deposits and generally to exercise such powers as are incidental to the banking busi ness as conducted in the country or countries, dependancy or dependencies in which its operations are carried on; (8) To eatablish and maintain for the transaction of its business a branch or branches, agency or agencies in foreign countries and their dependencies or in the dependencies of the United States at such places and under such rules and regula tions as the Federal Reserve Board may prescribe; and to establish and maintain such additional branches or agencies as the Federal Reserve Board may from time to time authorize even in countries or dependencies nor specified in the original organi zation certificate. (9) To purchase, use, and hold stock or other certificates or ownership in any other banking corporation organized under the provisions of this section or chartered under the laws of any foreign country or of any State in the United States not doing business in the United States except such business as in the judgment of the Federal Reserve Board is necessarily incidental to its international or foreign business: Provided, however, That it shall not hold stock in any one corporation in excess of ten per centum of its own paid-up and unimpaired capital and surplus, except with the consent of the Federal Reserve Board. The provisions of the act approved October Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

RECOMMENDATIONS OF THE FEDERAL ADVISORY COUNCIL. 857 15, 1914, entitled "An act to supplement existing laws against unlawful restraints and monopolies, and for other purposes," shall not apply to corporations or to officers, directors, or employees of corporations organized under this section. No national bank or other member of a Federal Reserve Bank shall subscribe for or hold stock in banking corporations organized under the provisions of this section aggregating more than ten per cent of the unimpaired capital and surplus of the sub scribing bank. Shareholders in corporations organized under this section shall not be liable for the contracts, debts, and engagements of such corporations. Any member bank may act as agent for any corporation organized under the provisions of this section for the purpose of dealing with any Federal Reserve Bank, and the Federal Reserve Board shall promulgate rules and regulations defining and govern ing transactions which such corporations may have with Federal Reserve Banks either direct or through the agency of member banks. No such corporation, how ever, shall become a member of any Federal Reserve Bank. Should any banking corporation organized under the provisions of this section fail to comply with any of its provisions or of any applicable laws of the United States, all the rights, privileges, and franchises of such corporation granted to it under this sec tion shall thereby be forfeited. Any noncompliance with or violation of such laws shall, however, be determined and adjudged by a United States court of competent jurisdiction in a suit brought for that purpose in the district or territory in which the home office of such corporation is located, by the Federal Reserve Board before the corporation shall be declared dissolved. In case of such noncompliance or violation every director who participated in or assented to the same shall be held liable in his personal or individual capacity for all damages which said bank, its shareholders, or any other person shall have sustained in consequence of such violation. Such disso lution shall not take away or impair any remedy against such corporation, its stock holders, or officers for any liability or penalty which shall have been previously in curred. Any such banking corporation may go into liquidation or be closed by a vote of its shareholders owning two-thirds of its stock. Whenever the Federal Re serve Board shall become satisfied of the insolvency of any such banking corporation, it may appoint a receiver who shall proceed to administer the estate of such corpora tion in the same manner in which he would administer the estate of a national bank, the disposition of the assets of the branches to be subject to any special provisions of the laws of the country under whose jurisdiction such assets are located. The annual meeting of every such banking corporation shall be held at its home office in the United States, and every such banking corporation shall keep at its home office books containing the names of all stockholders of such corporation, and members of its board of directors, together with copies of the records furnished by it to the Federal Reserve Board, exhibiting in detail and under appropriate heads the resources and liabilities of the banking corporation. Every banking corpora tion shall make reports to the Federal Reserve Board at such times as it may require and shall be subject to examinations when deemed necessary by the Federal Re serve Board through examiners appointed by it, the cost of such examinations and the compensation of such examiners to be fixed by the Federal Reserve Board and to be paid by the corporation examined. Recommendation.—This council approves of national charters being issued to foreign banking corporations formed under the Federal Reserve Act instead of State charters. (b) Any member bank located in a city or incorporated town or village of more than one hundred thousand inhabitants and possessing a capital and surplus of one million dollars or more, under such rules and regulations as the Federal Reserve Board may prescribe, may establish branches within the corporate limits of the city, town or village in which it is located, not to exceed, however, ten in number. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

858 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. Any member bank located in any other place, with the approval of the Federal Reserve Board and under such rules and regulations as said Board may prescribe, may establish branches within the limits of the county in which it is located, pro vided no such branch shall be established unless the capital of the parent bank is at least equal to the aggregate of the amounts which would be required, under the provisions of section 5138, Revised Statutes, of such bank and each branch, if each branch were an independent national banking association: Provided, however, That no member bank shall establish any branch or branches in any State in which neither State banks nor trust companies are permitted under the laws of the State to establish branches. Recommendation.—In reference to the proposed amendment the council would repeat its recommendation of November 20, 1916, as follows: We still adhere to the opinion expressed in our communication to you of September 21, 1915, to the effect "That the National Bank Act should be amended so as to per mit the establishment of branches of national banks having an unimpaired capital and surplus of not less than $1,000,000 in central reserve and reserve cities, provided that no branches are placed outside of the limits of the city where the head office of the parent bank is located." We are advised that such a privilege granted to national banks would not be affected by State laws and in our opinion any Federal legislation granting such a privilege should apply to all banks in the national system of adequate capital. TOPIC NO. 11. Amending section 11 (c). Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled, That section 11, subsection (c) of the act approved December 23, 1913, is hereby amended and reenacted by adding at the end thereof the follow ing paragraph. " Until June 1, 1919, the Federal Reserve Board may, in its discretion, suspend, in whole or in part, the reserve requirements specified in this act in the case of any State bank or trust company which becomes a member bank and which is located in a State whose laws do not either expressly or impliedly permit balances with a Federal Reserve Bank to be counted in lieu of the State reserve requirements, or to be considered as a reserve deposit made in compliance with those State reserve requirements: Provided, however, That each State bank or trust company for which the reserve requirements have been thus suspended shall maintain with its Federal Reserve Bank a balance to be determined by said Federal Reserve Bank an 1 approved by the Federal Reserve Board. Recommendation.—The council approves this amendment. The following members of the Federal Advisory Council were pres ent at this meeting: Mr. L. L. RUE, Vice President, in the Chair. Mr. D. G. WING. Mr. W. S. ROWE. Mr. J. W. NORWOOD. Mr. C. A. LYERLY. Mr. F. O. WATTS. Mr. J. R. MITOTTTCTX. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

RECOMMENDATIONS OF THE FEDERAL ADVISORY COUNCIL. 859 Recommendation of the Federal Advisory Council to the Federal Reserve Board, May 21, 1918. TOPIC NO. l. Curtailment of unnecessary credits. Recommendation.-—The Federal Advisory Council concurs in the principle laid down and the recommendations made by the Federal Reserve Board in regard to the conservation of credits and we urge upon the bankers of the country the great importance of their hearty cooperation in the adoption of the policy as outlined by the Federal Reserve Board in its April Bulletin. TOPIC NO. 2. The proper means of extending banking operations in foreign countries. This should involve a discussion of foreign branches of national banks having a million dollars or more of capital and surplus, and banks organized to do a foreign banking business in which national banks are stockholders to an amount not exceeding ten per cent of their capital and surplus. Recommendation.—The council believes that member banks and banks authorized to do a foreign business in which member banks are stockholders should be encouraged to take care of the foreign business of the country during the continuance of the war. The council reaffirms its statement made on February 19, 1917, as follows: The council recommends that the foreign business of the Federal Reserve Banks should for the present be conducted through correspondents and that neither agencies nor branches should be established in foreign countries by any Federal Reserve Bank until world conditions are more settled and until the efficiency of the service rendered by correspondents be thoroughly tested. TOPIC NO. 3. Foreign agencies of Federal Reserve Banks and the proposition to establish a Gov ernment foreign exchange bank. On this subject an interesting report has been submitted by a committee of the Chamber of Commerce of the United States, of which I presume you have a copy. Recommendation.—The council is of the opinion that it would be unwise under present conditions to establish a Government foreign exchange bank or for the Federal Reserve Board to undertake to regulate foreign exchange operations further than it is now doing in connection with the Treasury Department. We unanimously indorse the recommendations of the Federal Reserve Board that Federal charters be granted to banks which are now engaged in foreign bank ing business, the stock of which is owned by member banks. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

860 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. TOPIC NO. 4. Senate Bill No. 4426 which the Board understands has been favorably reported by the Senate Committee on Banking and Currency. [S. 4426, 65th Congress, 2d Session. Calendar No. 368. (Report No. 407.)] IN THE SENATE OF THE UNITED STATES. APBIL 23, 1918.—Mr. Shafroth introduced the following bill; which was read twice and referred to the Committee on Banking and Currency. APRIL 24, 1918.—Reported by Mr. Owen, without amendment. A BILL To amend and reenact section fifty-two hundred and thirty-five and fifty-two hundred and thirty-six of the Revised Statutes of the United States by providing for a guaranty fund for payment of certain deposits, and for other purposes. Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled, That section fifty-two^hundred and thirty-five and fifty-two hundred and thirty-six of the Revised Statutes of the United States be, and they are hereby, amended and reenacted to read as follows: "SEC. 5235. That the comptroller shall, upon appointing a receiver, cause notice to be given, by advertisement in such newspapers as he may direct, for three consecutive months, calling on all persons who may have claims against such asso ciation to present the same and to make legal proof thereof. At the expiration of thirty days after such notice has been first published the comptroller shall pay in full the claim of each depositor which has been proven to his satisfaction, or which has been adjudicated in a court of competent jurisdiction and which does not exceed the sum of $5,000, and shall pay the sum of $5,000 to each depositor whose claim has been established as herein provided and which in excess of that amount. Such payments shall be made by the comptroller out of moneys depos ited to his credit by the receiver and by the Secretary of the Treasury as herein after provided. The Secretary of the Treasury shall advance to the comptroller, out of funds in the Treasury not otherwise appropriated, such sum or sums as may be necessary to enable him to make the payments herein provided for. " SEC. 5326. From time to time, after full provision has been'first made for refund ing to the United States any deficiency in redeeming the notes of such association, the comptroller shall make a ratable dividend of the money paid over to him by such receiver on all such claims as may have been proved to his satisfaction or adjudicated in a court of competent jurisdiction, which have not been paid in full as provided in section fifty-two hundred and thirty-five of the Revised Statutes as herein amended, and as the proceeds of the assets of such association are paid over to him he shall make further dividends on all unpaid claims previously proved or adjudicated, and the remainder of the proceeds, if any, after all claims against the estate of the bank have been paid or satisfied, shall be used to reimburse the Treasury for .advances made as provided in said section fifty-two hundred and thirty-five as herein amended, and the balance, if any, shall be paid over to the shareholders of such shares, or their legal representatives, in proportion to the stock by them, respectively, held. In order to indemnify the United States against loss on account of advances made as herein provided and to provide funds for the purpose of making such advances, there shall be levied and collected yearly from each national bank a tax not in excess of one-tenth of one per centum of the aggregate of all deposits averaging $5,000 or less, and a tax not in excess of one-tenth of one per centum on $5,000 of the aggregate of each of the other deposits averaging more than $5,000. "No deposit bearing over four per centum interest per annum shall be the bene ficiary of this Act.'' Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

RECOMMENDATIONS OF THE FEDERAL ADVISORY COUNCIL. 861 Recommendation.—We are opposed to the guaranty of bank deposits in any form, believing it to be wrong in principle. Inasmuch as the official report of the Comptroller of the Currency shows the loss to depositors in failed national banks to be less than three onethousandths of one per cent during the last three years and with the Government offering the highest possible security to induce the use of hoarded funds the necessity of such legislation is not apparent. The council reaffirms its declaration of April 18th, 1917, which said: "A plan might, however, be devised by the Federal Reserve Board, which would provide for prompt relief to be given depositors of failed member banks." (Passed with one dissenting vote.) TOPIC NO. 5. Bankers' acceptances. Recommendation.—This council is of opinion that the use of bankersJ acceptances should be encouraged and developed, as it will be of great service to the country in meeting its necessary financial requirements, particularly during the period of the war. In order to accomplish this legislation may be necessary granting the banks greater accepting power. Every effort should be made to encourage and develop a broad open discount market for these acceptances. TOPIC NO. 6. Discount rates. Recommendation.—It is the opinion of the council that in view of the large payments for taxes and Government bonds which will be be made shortly it is undesirable at this time to change the discount rates at the Federal Reserve Banks. The following members of the Federal Advisory Council were present at this meeting: President, James B. Forgan, in the chair; vice president, L. L. Rue; D. G. Wing, J. P. Morgan, W. S. Rowe, C. A. Lyerly, F. O. Watts, J. R. Mitchell, E. F. Swinney, E. P. Wilmot, Herbert Fleishhacker, and Merritt H. Grim, secretary. Recommendations of the Federal Advisory Council to the Federal Reserve Board, September 17, 1918. TOPIC NO. 1. Development of the acceptance market. (With reference to the call loan rate of 4£ per cent recently established in New York on notes secured by acceptances.) Recommendation.—The making of a preferential rate by banks in the financial centers on demand loans secured by acceptances will aid in the development of the market for acceptances by facilitating and encouraging their use. It seems to us that the acceptance market Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

862 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. is developing wonderfully well under existing circumstances which while favorable for the making of such forms of credit are not so favorable for the marketing of them. TOPIC NO. 2. The use of bankers' and trade acceptances in financing the movement of crops. Recommendation.—The council is of the opinion that the bankers and commercial interests are both alive to the use of trade and bankers' acceptances and that the use of these forms of credit is being developed as rapidly as can be expected under present condi tions. While conservative bankers are disposed to encourage the legitimate use of bankers' acceptances they are equally disposed to discourage their misuse wh§re the transaction does not naturally arise in the usual course of their customers' business. They are inclined to hold their acceptance privilege in reserve for the benefit of their customers engaged in essential lines of business, whose credit requirements are enhanced by war orders. TOPIC NO. 3. Progress of the movement to curtail nonessential credits, (a) Have results thus far been obtained without undue hardships? Answer.—The efforts of the Federal Reserve Board, followed up by various clearing house associations and other bodies, have, we believe, resulted in bankers generally discriminating between essential and nonessential -credits and in a reduction of the latter. They can not, however, enforce payment of current loans nor can they indiscriminately decline new credits to the point of causing hard ships and embarrassments to their customers without such action retaliating against themselves. We are of the opinion that no undue hardships have resulted and we believe that as a rule borrowers are cooperating with the banks by curtailing their demands for credit for nonessential purposes. (b) Is it practicable to lay down any general rule"governing a differentiation between essential and nonessential credits, and, if so, what is the best method of its application? Answer.—As applications for bank credit are of such unlimited variety that each must be dealt with on its individual merits, we doubt the feasibility of laying down any general rule governing a differentiation between essential and nonessential credits. We believe bankers generally appreciate the necessity for such differ entiation and fully understand the difference between essential, less essential and nonessential credits. Moreover, the demand for essential credits is so strong as to make it as unnecessary as it would be unwise and unpatriotic to fail to discriminate in their favor. We Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

RECOMMENDATIONS OF THE FEDERAL ADVISORY COUNCIL. 863 believe the persistent prosecution of the Federal Reserve Board's efforts, already well developed, will be all that is necessary. TOPIC NO. 4. (a) Investments of banks in public utility corporations and loans on such collateral. Recommendation.—It is most essential that the assets of the banks of the country be kept in as liquid form as possible and with this in view they should not invest to any large extent in public utility securities nor to any large extent make loans on such collateral. (b) What can be done to assist public utilities in the emergency which now con fronts them? Answer.—In our opinion a mistake was made in the law under which the War Finance Corporation was organized by involving the banks in the financing of public utilities. The law should be so amended or such legislation enacted as would give the War Finance Corporation general instead of emergency power to deal directly with the borrowers without the intervention of the banks or through some other corporation or agency organized for the purpose. It is highly desirable that loans should be made to public utilities only where rates are granted which are adequate to meet the present cost of operation. In the interest of the Government's war program power should be given a board appointed by the President to regu late public service rates or if that power can not constitutionally be granted them, then to negotiate with and urge local State authorities to grant such increases in rates for all classes of public service as may be found necessary during the period of the war and for a rea sonable time thereafter. TOPIC NO. 5. Distribution of Liberty bonds and discussion of preferential rates at Federal Reserve Banks on paper secured by Government obligations. Recommendation.—We would recommend that the member banks should make loans on the fourth Liberty loan bonds on the same terms as those very generally made on the third Liberty loan bonds, viz, the coupon rate for ninety days' loans, with a moderate advance over that rate for renewals, and that the Federal Reserve Banks, to encourage subscriptions to the new loan, should make a prefer ential rate on ninety days' loans of from \ to \ of one per cent below the coupon rate. TOPIC NO. 6. Gold Embargo. Recommendation.—The council is of the opinion that it would be unwise to nermit the free exnort of ^old at this time in view of the Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

864 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. In regard to the release of gold to Mexico in return for silver bullion, we believe that if a substantial increase in silver imported from that country can be obtained by increasing somewhat the percentage of gold exported against silver bullion shipped us, such an arrangement would under present conditions be to our advantage. TOPIC NO. 7. Supervision by the Capital Issues Committee of loans made by banks for capital purposes. Recommendation.—We would recommend that the member banks be urged to cooperate with the Capital Issues Committee in its effort to obtain full information of projected capital issues, so that the consent of the committee may be obtained before any financial com mitments are made by prospective borrowers. TOPIC NO. 8. Discount rates. Recommendation.—It is the opinion of the council that the discount rates of the Federal Reserve Banks have been properly and carefully regulated by the directors of the respective banks, with the approval of the Federal Reserve Board, and we see no occasion at present for any change either in the existing rates or in the policy heretofore pursued, other than as we have previously recommended for the encouragement of subscriptions to the fourth Liberty loan. ADDITIONAL RECOMMENDATIONS. TOPIC NO. 9. Tax on undistributed earnings of banks, proposed in pending legislation. Recommendation—In view of the fact that the undistributed earn ings of banks immediately become additional banking capital, which should be conserved during this war period, the council recommends that an exception be made of the banks, so that, as was provided in the previous tax law, the normal rate only shall apply to their un distributed profits and that the Federal Reserve Board take steps to bring this matter before the proper committees of Congress. TOPIC NO. 10. Member State banks to receive Government deposits. Recommendation.—For the purpose of affording State banks coming into the Federal Reserve system all the privileges afforded to national banks with respect to Government deposits, this council would recom mend that the words "All national banking associations," occurring in section 5153 of the Revised Statutes of the United States, should be changed to read "All banks members of the Federal Reserve ±. if Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

RECOMMENDATIONS OF THE FEDERAL ADVISORY COUNCIL. 865 TOPIC NO. 11. Recommendation.—The constant rise in prices has resulted in a condition increasing in danger to the merchant and manufacturer directly and thence to the member banks and the Federal Reserve system, which should be given serious consideration by those in charge of the taxing program of the Government. We therefore recom mend the approval of the amendment to the present draft of the law offered by the National Dry Goods Association, as follows: Section 202 of the proposed bill provides: INVENTORIES. "SEC. 202. That whenever in the opinion of the commissioner the use of inventories is necessary in order clearly to determine the income of any taxpayer, inventories shall be taken by such taxpayer upon such basis as the commissioner, with the approval of the Secretary, may approve or prescribe as most clearly reflecting the income of the taxpayer." We suggest that that section be amended by adding thereto the following: "A reasonable allowance being made for the increased cost of merchandise so inventoried over the average cost of like merchandise during the prewar period." RESOLUTION. Resolved, That it is the sense of the Federal Advisory Council that the suggestion made by Governor Harding regarding the absorption by the Federal Reserve Banks of the expenses incident to transfers of currency and securities to and from member banks should be given favorable consideration by the Federal Reserve Board. The following members of the Federal Advisory Council were pres ent at this meeting: President, James B. Forgan, in the chair, vice president, L. L. Rue; D. G. Wing, J. P. Morgan, W. S. Rowe, J. W. Norwood, C. A. Lyerly, F. O. Watts, J. R. Mitchell, E. F. Swinney, E. P. Wilmot, Herbert Fleishhacker, and Merritt H. Grim, secretary. Recommendations by the Federal Advisory Council to the Federal Reserve Board, November 19, 1918. I. TOPIC NO. 1. Federal Reserve notes. Question: Is it desirable that steps should be taken to check further growth in the volume of Federal Reserve notes? If so, what action is recommended? Answer.—During the period of readjustment and reconstruction on which we are now entering sudden changes in financial conditions are likely to arise which will have to be met with practical banking judgment. It would seem to be undesirable to take any steps to check further growth in the volume of Federal Reserve notes issued. The expansion which has taken place recently incident to war financ- Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

866 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. ment financing and probably through the reconstruction period, is made possible chiefly through the issue of Federal Reserve notes. Their issue and redemption respond to the requirements of trade. Natural and not artificial methods should control the situation. TOPIC NO. 2. Development of open markets for bankers' acceptances. Question: What steps can be taken to promote and accelerate the development in each Federal Reserve district of an open market for bankers' acceptances? Answer.—No steps should be taken by the Federal Reserve Board as yet. Banking habits must be given time to develop and should not be rushed. The open market for bankers' acceptances is devel oping and must grow by use. TOPIC NO. 3. Drafts drawn for the purpose of furnishing dollar exchange. The Board has heretofore granted permission to member banks to accept drafts drawn upon them by banks and bankers in Central and South America for the purpose of furnishing dollar exchange. The opinion of the council is desired as to whether there are other countries in which the "usages of trade" are such as would warrant the extension of the Board's policy. Recommendation.—This question does not seem to require imme diate attention. Under the development of peace conditions un doubtedly the drawing of drafts to create dollar exchange from coun tries other than those prescribed may become necessary, but the mat ter can be considered more intelligently later as conditions develop. TOPIC NO. 4. Extension of American banking facilities in foreign countries. (A) Question.— Are there any special steps which the council would recommend that the board should take for the purpose of encouraging the establishment of additional American banking facilities in foreign countries? Answer.—The purpose of establishing American banking facilities in foreign countries is of course to encourage and enlarge American trade. The two go together. Branch banking in foreign countries may be considered as having developed most satisfactorily under the trying conditions which have prevailed since the Federal Reserve Act, which first authorized this method of banking, was enacted. Under peace conditions doubtless there will be further development and there would seem to be no steps necessary at this time to further encourage the business. (B) Question.—Should the Board, in the exercise of its powers over foreign branches of national banks and banking corporations engaged in foreign bank ing in the stock of which national banks are permitted by the Board to invest, require that reserves of not less than a stated per cent be maintained against demand deposit liabilities of such branches and banks? If so (a) should require ment be uniform in all countries in which such branches and banks are operated, and (b) of what should the reserve consist, and (c) what reserve percentage is recommended? Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

KECOMMENDATIONS OF THE FEDERAL ADVISORY COUNCIL. 867 Answer.—We are advised that the Federal Reserve Board has already definitely decided this question on the lines that such banks will not be required to keep a fixed ratio of reserve and that foreign branches of national banks will not be required to keep any portion of their reserve in Federal Reserve banks against deposits received in foreign countries, the whole matter of reserves of their foreign branches being left to the discretion of the parent institution. This council concurs in the action of the Federal Reserve Board in this matter. (C) Question.—What limit or restriction should be imposed upon the acceptance power of banks engaged in foreign banking, which are operated under super vision of the Federal Reserve Board? Answer.—At present the ratio of six to one between acceptances and capital and surplus would seem sufficient to meet the require ments, but as the business of the branches of American banks grows, there is reason to believe that it may be necessary later to increase the ratio, which, under proper control, can be done conservatively. When American banks begin to approach their present limit of six to one, and make application for permission to increase the ratio, would seem time enough to consider such extension. Branches of foreign banks are operated ordinarily without limits. TOPIC NO. 5. Question.—What further services should be rendered by Federal Reserve Banks to the public through additional free facilities granted to member banks? Answer.—During the past year the Federal Reserve Banks have added considerably to the free facilities afforded to the public through member banks. The council has at this time no suggestion to make in regard to an extension of these free services. It would not seem desirable to add materially to the burdens assumed by the Federal Reserve Banks until the relations of the Federal Reserve Banks and their member banks are established upon a peace basis. II. In view of the apparent near conclusion of hostilities, the attention of the council is invited to the consideration of after-war policies, both domestic and foreign, of the Federal Reserve system. TOPIC NO. 6. Question.—With respect to the requirements of the domestic situation, should the policy of the Federal Reserve Banks be restrictive or liberal? In other words, should contraction of credit and currency be a controlling consideration in the board's policies? Answer.—The policy of the Federal Reserve Banks should be as liberal as is consistent with safety. Any attempt at enforced con traction of credit on their part would be injurious to the business Digitized foirn FtRerAeSsEtRs of the country. http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

868 ANNUAL BEPOKT OF THE FEDERAL RESERVE BOARD. TOPIC NO. 7. Question.—In connection with the consideration of the changed position of the United States with respect to international finance and banking, what should be the policy of the Federal reserve system with respect to A. The management of its gold reserve? B. Operations in the purchase and sale of foreign bills? Answer,—A. Acting in conjunction with Great Britain the United States should get back to a free gold market as soon as feasible. B. The purchase and sale of foreign bills should be engaged in by the Federal Reserve banks only as a means to regulate the exchange market and to control gold. TOPIC NO. 8. In connection with the discussion of A (Topic No. 7), consideration of the following further questions is asked: Question (a).—Is it desirable that the gold embargo should be continued on shipments of gold to any country or group of countries after the termination of the war? If so, on what principle? Question (b).—Should the gold embargo be lifted on behalf of any country or group of countries before the termination of the war? Answer (a and b).—It would seem desirable that, the question of the gold embargo be left to the Gold Committee, to be handled with such elasticity as developing conditions make advisable. If the Gold Committee of the Federal Reserve Board is free to pass on all applications for gold for shipment with entire freedom, the merits of each individual case in connection with the whole situation can decide its action. We would recommend that the necessary legis lation be obtained as soon as possible continuing the powers of this committee for a period of six months beyond the declaration of peace. Question (c).—Is it desirable that the Federal Reserve system should undertake by informal conferences with other central banking systems, to formulate policies or promote arrangements to regulate the international distribution and flow of gold in an orderly manner, at the end of the war? Question (d).—Is it desirable that provision should be made in the treaty stipu lations following the conclusion of war for the establishment, under suitable safe guards and international guarantees, of international trust funds of gold so as to minimize the hazards and costs of gold shipments? Answer (c and d).—It would not seem desirable at this time to encourage any informal conference with other central banking sys tems for the purpose stated. During the war we have had a close working arrangement with Great Britain. Such a working arrange ment if continued would probably meet the situation. No treaty stipulations in connection with international trust funds of gold would seem to us to be desirable. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

RECOMMENDATIONS OF THE FEDERAL ADVISORY COUNCIL. 869 TOPIC NO. 9. In connection with the discussion of B (Topic No. 7) consideration of the following further questions is asked: Question (a).—Should it be the policy of the United States to establish and maintain a free gold market? Answer.—The United States should as soon as possible reestablish and maintain a free gold market if it is to remain a world banker and hold the place it has secured during the past four years. Par ticularly will this be necessary if Great Britain carries out its inten tion of reestablishing its free gold market. Question (b).—If such a policy is adopted, should the main reliance of the reserve system be the adoption of the English practice of regulating the flow of gold by a variable discount rate? Answer.—The main reliance of the Federal Reserve system should be the adoptoin of the English practice of regulating the flow of gold by establishing a variable discount rate. ADDITIONAL RECOMMENDATIONS, NO. 1. Amend the Federal Reserve Act to allow surpluses of Federal Reserve banks to accumulate until they are 100 per cent of their paid-in capitals. The Federal Advisory Council recommends that the first para graph of section 7 of the Federal Reserve Act be amended to read as follows: SEC. 7. After all necessary expenses of a Federal Reserve Bank have been paid or provided for, the stockholders shall be entitled to receive an annual dividend of six per centum on the paid-in capital stock, which dividend shall be cumulative. After the aforesaid dividend claims have been fully met, all the net earnings shall be paid into a surplus fund until it shall amount to one hundred per centum of the paid-in capital stock of such bank, after "which all the net earnings in excess of aforesaid dividend shall be paid to the United States as a franchise tax. NO. 2. Amend Federal Reserve Act to allow members banks to accept foreign bills up to 200 per cent of their capital and surplus. It is generally conceded that following the declaration of peace, this country will have an opportunity to develop its foreign trade to an extent impossible before the war. If we are to develop and maintain our export and import trade it should be financed by American banks and bankers and it is therefore essential that the member banks be granted additional acceptance powers to properly take care of the increasing volume of dollar exchange and credits. We recommend that the Federal Reserve Act be amended as soon as possible so as to allow member banks to accept on purely foreign Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

870 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. transactions up to 200 per cent of their capital and surplus. This limit to include acceptances of foreign banks or bankers for the account and under the guaranty of the member banks. This accept ance power to be in addition to that now provided by the act for domestic acceptances. NO. 3. To make bank acceptances available as reserve to the owning bank on the day of maturity. The council suggests the institution by the Federal Reserve Board of a uniform plan by which bank acceptances may be available as reserve to the owning bank on the day of maturity and payment. It would seem a simple process to accomplish this end by wire through the gold fund and the service would broaden the market for such acceptances. NO. 4. Federal Reserve Banks should not afford nonmember banks clearing privileges unless they belong to the clearing house if any exists in the city in which they are located. The council recommends that the Federal Reserve Banks should adopt the policy of not permitting non-member banks to avail them selves of the privilege of clearing their items through them unless the nonmember banks are members or affiliated members of the clearing house association if any exists in the city in which said nonmember banks are located and subject to clearing house rules and regulations. The following members of the Federal Advisory Council were present at this meeting: President, James B. Forgan, in the chair; vice-president, L. L. Rue; D. G. Wing, J. P. Morgan, W. S. Rowe, J. W. Norwood, C. A. Lyerly, F. O. Watts, J. R. MitcheU, E. P. Wilmot, Herbert Fleishhacker, and Merritt H. Grim, secretary. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DESCRIPTION OF FEDERAL RESERVE DISTRICTS. Below are descriptions of the 12 Federal Reserve districts, accom panied by estimates of the population of each district recently fur nished by the Bureau of the Census as of December 31, 1918. A map showing outline of the districts is also appended. DISTRICT NO. 1—BOSTON (7,100,626). Connecticut (except Fairfield County) (997,492). Maine (784,616). Massachusetts (3,861,198). New Hampshire (447,313). Rhode Island (643,190). Vermont (366,815). DISTRICT NO. 2—NEW YORK (13,482,730). Connecticut (county of Fairfield) (299,224). New Jersey (counties of Monmouth, Middlesex, Hunterdon, Somerset, Union, Essex, Passaic, Hudson, Bergen, Morris, Sussex, and Warren) (2,443,111). New York (10,740,395). DISTRICT NO. 3—PHILADELPHIA (6,772,233). Delaware (217,832). New Jersey (except counties enumerated under District No. 2) (670,348). Pennsylvania (eastern part) (5,884,053). Counties: Adams. Chester. Huntingdon. Monroe. Snyder. Bedford. Clearfield. 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. Lycoming. Pike. York. Carbon. Franklin. McKean. Potter. Center. Fulton. Mifflin. Schuylkill. DISTRICT NO. 4—CLEVELAND (9,511,858). Kentucky (eastern part) (1,053,092). Counties: Bath. Estill. Kenton. Magoffin. 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. Breathitt. 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. 871 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

872 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. Ohio (5,304,678). Pennsylvania (western part) (2,983,028). Counties: Allegheny. Clarion. Forest. Lawrence. Warren. Armstrong. Crawford. Greene. Mercer. Washington. Erie. Indiana. Somerset. Westmoreland. Butler. Fayette. Jefferson. Venango. West Virginia (northern part) (171,060). Counties: Brooke. Marshall. Ohio. Tyler Wetzel. Hancock. DISTRICT NO. 5—RICHMOND (9,444,773). District of Columbia (377,235). Maryland (1,389,972). North Carolina (2,481,847). South Carolina (1,669,799). Virginia (2,244,533). West Virginia (all counties except Brooke, Hancock, Marshall, Ohio, Tyler, and Wetzel) (1,281,387). DISTRICT NO. 6—ATLANTA (10,299,921). Alabama (2,410,936). Florida (950,223). Georgia (2,955,505). Louisiana (southern part) (1,324,906). Parishes: Acadia. East Feliciana. Livingston. St. James. Vermilion. Allen. Evangeline. Orleans. St. John the Baptist . Vernon. Ascension. Iberia. Plaquemines. St. Landry. Washington. Assumption. Iberville. Pointe Coupee. St. Martin. West Baton Rouge, Avoyelles. Jefferson. Rapides. St. Mary. West Feliciana. Calcasieu. Jefferson Davis. St. Bernard. St. Tammany. Cameron. Lafayette. St. Charles. Tangipahoa. East Baton Rouge. Lafourche. St. Helena. Terrebonne. Mississippi (southern part) (1,018,224). Counties: Adams. Greene. Jones. Neshoba. Smith. Amite. Hancock. Kemper. Newton. Walthall. Claiborne. Harrison. Lamar. Bearl 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. Tennessee (eastern part) (1, 640,127). 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. Lawrence. 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. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DESCRIPTION" OF FEDERAL RESERVE DISTRICTS. DISTRICT NO. 7—CHICAGO (14,362,272). Illinois (northern part) (5,084,511). Counties: Boone. Douglas. Kankakee. Marshall. Shelby. Bureau. Dupage. Kendall. Mason. Stark. Carroll. Edgar. Knox. Menard. Stephenson. Cass. Ford. Lake. Mercer. Tazewell. Champaign. Fulton. La Salle. Moultrie. Vermilion. Christian. Grundy. Lee. Ogle. Warren. Clark. Hancock. Livingston. Peoria. Whiteside. Coles. Henderson. Logan. Piatt. Will. Cook. Henry. McDonough. Putnam. Winnebago. Cumberland. Iroquois. McIIenry. Rock Island. Woodford. Dekalb. Jo Daviess. McLean. Sangamon. Dewitt. Kane. Macon. Schuyler. Indiana (northern part) (2,254,706). 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. Kandolph. Wayne. Clay. Hendricks. Marshall. Pvipley. Wells. Clinton. Henry. Miami. Rush. White. Dearborn. Howard. Monroe. St. Joseph. Whitley. Decatur. Huntington Montgomery. Shelby. Dekalb. Jasper. Morgan. Starke. Iowa (2,218,529). Michigan (southern part) (2,771,087). 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. Genesee. Lake. Muskegon. Sanilac. Bay. Gladwin. Lapeer. Mewaygo. Shiawasee. Benzie. Grand Traverse. Leelanau. Oakland. Tuscola. Berrien. Gratiot. Lenawee. Oceana. Van Bur en. Branch. Hillsdale. Livingston. Ogenaw. Washtenaw. Calhoun. Huron. Macomb. Osceola. Wayne. Cass. Ingham. Manistee. Oscoda. Wexford. Charlevoix. Ionia. Mason. Otsego. Cheboygan. Iosco. Mecosta. Ottawa. Wisconsin (southern part) (2., 033,439). 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. Racine. Waukesha. Crawford. Jackson. Marinette. Richland. Waupaca. Dane. Jefferson. Marquette. Rock. Waushara. Dodge. Juneau. Milwaukee. Sauk. Winnebago. Door. Kenosha. Monroe. Shawano. Wood. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

874 ANNUAL KEPOKT OF THE FEDEKAL RESEBVE BOARD. DISTRICT NO. 8—ST. LOUIS (9,403,997). Arkansas (1,806,276). Illinois (southern part) (1,274,592). 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) (608,798). 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) (1,362,682). 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. Larue. Nelson. Warren. Caldwell. Gallatin. Livingston. Ohio. Washington. Calloway. Graves. Logan. Oldham. Wayne. Carlisle. Grayson. Lyon. Owen. Webster. Carroll. Greene. McCracken. Russell. Mississippi (northern part) (995,689). 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) (2,666,521). Counties: All except those included in district No. 10. Tennessee (western part) (689,439). Counties: Benton. Dyer. Haywood. McNairy. Weakley. Carroll. Fayette. Henderson. Madison. Chester. Gibson. Henry. Obion. Crockett. Hardeman. Lake. Shelby. Decatur. Hardin. Lauderdale. Tipton. DISTRICT NO. 9—MINNEAPOLIS (5,320,212). Michigan (northern part) (382,296). Counties: Alger. Delta. Houghton. Luce. Menominee. Baraga. Dickinson. Iron. Mackinac. Ontonagon. Chippewa. Gogebic. Keweenaw. Marquette. Schoolcraft. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DESCRIPTION OF FEDERAL RESERVE DISTRICTS. Minnesota (2,361,707). Montana (493,096). North Dakota (804,496). South Dakota (744,665). Wisconsin (northern part) (533,952). 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 (7,643,044). Colorado (1,027,712). Kansas (1,885,357). Missouri (western part) (791,428). Counties: Andrew. Buchanan. Dekalb. Jasper. Platte. Atchison. Cass. Gentry. McDonald. Vernon. Barton. Clay. Holt. Newton. Worth. Bates. Clinton. Jackson. Nodaway. Nebraska (1,303,252). New Mexico (northern part) (205,737). Counties: Colfax. Mora. Sandoval. San Miguel. Taos. McKinley. Rio Arriba. San Juan. Santa Fe. Union. Oklahoma (all except southeastern part) (2,236,473). Counties: Adair. Craig. Jackson. Muskogee. Rogers. Alfalfa. Creek. Jefferson. Murray. Roger Mills. Beaver. Delaware. Kay. Noble,' Seminole. Blaine. Dew^ey. Kingfisher. Nowata. Sequoyah. Beckham. Ellis. Kiowa. Okfuskee. Stephens. Caddo. Garfield. 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. Mcintosh. Pottawatomie. Woods. Cimarron. Haskell. Major. Pittsburg. Woodward. Cleveland. Hughes. Mayes. Pontotoc. Wyoming (193,085). DISTRICT NO. 11—DALLAS (5,768,618). Arizona (southeastern part) (127,623). Counties: Cochise. Pima. Graham. Santa Cruz. Greenlee. Louisiana (northern part) (573,784). Parishes: Bienville. Claiborne. Jackson. Ouachita. Webster. Bossier. Concordia. La Salle. Red River. West Carroll. Beauregard. De Soto. Ijincoln. Richland. Winn. Caddo. East Carroll. Madison. Sabine. Caldwell. Franklin. Morehouse. Tensas. Catahoula. Grant. Natchitoches. Union. New Mexico (southern part) (237,961). Counties: Bernalillo. Eddy. Lincoln. Quay. Socorro. Chaves. Grant. Luna. Roosevelt. Torrence. Curry. Guadalupe. Otero. Sierra. Valencia. Dona Ana. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

876 ANNUAL REPORT OF THE FEDERAL RESERVE BOARD. Oklahoma (southeastern part) (185,043). Counties: Atoka. Choctaw. Johnston. Marshall. Pushmataha. Brj^an. Coal. McCurtain. Texas (4,644,207). DISTRICT NO. 12—SAN FRANCISCO (6,952,015). Arizona (northwestern part) (148,534). Counties: Apache. Gila. Mohave. Pinal. Yuma. Coconino. Maricopa. Navajo. Yavapai. California (3,164,602). Idaho (470,061). Nevada (116,744). Oregon (901,368). Utah (458,539). Washington (1,692,167). RECAPITULATION. Estimated population Dec. 81, 1918. Federal Reserve district: No. 1—Boston 7,100,624 No. 2—New York 1 13,482,730 No. 3—Philadelphia 6, 772, 233 No. 4—Cleveland 9,511,858 No. 5—Richmond 9, 444, 773 No. 6—Atlanta 10, 299, 921 No. 7—Chicago 14,362,272 No. 8—St. Louis 9, 403, 997 No. 9—Minneapolis 5, 320, 212 No. 10—Kansas City 7, 643, 044 No. 11—Dallas 5, 768, 618 No. 12—San Francisco 6, 952, 015 Total 106, 062, 297 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

INDEX TO PART I-REPORT OF THE FEDERAL RESERVE BOARD. Acceptances: Page. Acceptance liability of American banks 23 Amendment to act suggested, providing additional facilities for engaging in foreign transactions 24 Amounts discounted by all Federal Reserve Banks 167,187,189 Amounts purchased during 1915-1918 19,172-174,187,189 Amounts purchased from other Federal Reserve Banks, 1917 and 1918.. 19,173, 175-182 Bank of England rates 20 Bankers'— Bought in the open market 18,19,187,189 Differential in their favor 19 Discount rates on 19-21 In London 19 Holdings of, by Federal Reserve Banks 11,12 Indorsement on 4 New York principal market for 3 Open-market purchases of, growth in 3,19,187,189 Purchases and sales of, between Federal Reserve Banks 3-4 Banks granted authority to accept up to 100 per cent 18, 240 Bill of lading drafts 12 Discount rates 7-8,19, 22 Earnings, amounts and annual rate on 28,192,211 Holdings of Federal Reserve Banks— By classes of acceptors 130 By maturities 129 On Fridays during year 9,10,120-121 Market for, development of 23 Maturities of 129,174 Member banks authorized to accept up to 100 per cent 18, 240 Open market purchases, 1915-1918 3,19,172-174,187,189 Purchases and sales between Federal Reserve Banks 3, 4,175-182 Rates 19, 22 Total purchases during the year 187,189 Trade- Discounted 167,187,189 Holdings by Federal Reserve Banks 11,12 Increase in volume of 18 Purchases of 18,187,189 Adelson, L. C, appointed assistant secretary of Federal Reserve Board 85 Administrator, executor, etc., powers granted to national banks. (See Fiduciary powers.) Advisory Council. (See Federal Advisory Council.) Agricultural paper: Amounts discounted 159-160 Amounts held » 11 Discount rates on. (See Discount rates.) 877 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

878 INDEX TO PART I. Amendments to the Federal Reserve Act. (See Federal Reserve Act, amend ments to.) Amendments to Revised Statutes. (See Revised Statutes.) Page. American Bankers' Association, work by, in campaign for State bank members. 26 American Foreign Banking Corporation, New York, foreign branches of 59 Analysis and Research, division of 62,248 Asia Banking Corporation, New York, foreign branches of 60 Assets and liabilities of Federal Reserve Banks. (See Resources and liabilities.) Attorney General, opinion of, relative to check collection charges 76 Baltimore branch, directors and manager of 254 Bank notes. (See Federal Reserve bank notes; National bank notes.) Bank of England, discount rates on acceptances 20 Bank premises, Federal Reserve Banks 30-32,214 Depreciation charges on 31 Value of 214 Bankers' acceptances. (See Acceptances, bankers'.) Bills bought. (See Acceptances.) Bills of exchange: Discount rates 20-22 In London 20-22 (See also Acceptances.) Bill of lading drafts, holdings of, by Federal Reserve Banks 12 Birmingham branch, directors and manager of 255 Bonds. (See United States .securities; Liberty bonds.) Branches, foreign, of American banks 59-61, 234 Branches of Federal Reserve Banks 72 Branch bank cities as reserve cities, policy of Board to designate 72 Directors and managers of. (See Federal Reserve Banks, branches of.) Branches of national banks: Foreign 60, 234 Proposed amendment to Federal Reserve Act relating to 83 Broderick, Joseph A., appointed secretary of Federal Reserve Board 85 Bullion, gold and silver, export of 35-38, 260 Canadian currency and silver, regulations re export of 36 Capital of Federal Reserve Banks 122 Capital Issues Committee: Establishment of— Under Federal Reserve Board 64 Under provisions of War Finance Corporation Act 66 Personnel of 64 Certificates of indebtedness: Allotments of, in anticipation of Liberty loans and tax payments 2,207-208 Amounts subscribed and collected through the Federal Reserve Banks. 2,207-208 (See also United States securities.) Chapman, Webb T., appointed assistant secretary of Federal Reserve Board. 85 Charges, depreciation, treatment of, in closing books of Federal Reserve Banks 31 Charts: Deposit and note liabilities, also reserves, of all Federal Reserve Banks, 1918 126 Earning assets, movement of, on each Friday during year 119 Gold settlement fund operations 198 Total cash reserves each Friday during year 101 Total cash reserves and excess reserves of all Federal Reserve Banks, 1918. 127 War paper and total paper discounted during 1918 169 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

INDEX TO PART I. 879 Page. Check clearing and collection 74-77 Attorney General, opinion of, relative to service charges 76 Average number and amount of items handled daily 74, 204 Cost per item handled and per $1,000 205 Currency shipments, cost of, borne by Federal Reserve Banks 74, 77 Effort made to increase number of banks on par list 75 Number of banks remitting at par 75, 206 Number of banks not remitting at par 75 Postage, expressage, etc., incident to currency shipments, absorbed by Federal Reserve Banks 74, 77 Service charges 76 China, export of silver to 37, 260 Cincinnati branch, directors and manager of 254 Clayton Act, restrictions removed relating to State banks 24 Clearances through international gold fund 35 Coin, bullion, and currency, export of, licenses granted by the Board, Sept.- Dec, 1918 37,260 Collateral notes. (See Discounts.) Collateral security held against Federal Reserve notes. (See Federal Re serve notes.) Colombia, exports of gold to 39,260 Commercial paper: Amount discounted during year 187,189 Bills discounted and held 9-12,17-18,187 Open-market purchases 9-13 Rediscounts and sales between Federal Reserve Banks 3-4,175-182 Secured by Government war obligations 9-12,17-18,187 (See also Discounts.) Crop moving, rediscount requirements 4 Currency: Charges on shipments of, paid by Federal Reserve Banks 74, 77 Export of 35-38, 260 Licenses granted by the Board, Sept .-Dec., 1918 37, 260 Customers' paper. (See Discounts.) Dealers in foreign exchange: Purchases and sales of foreign exchange by 53 Registration of 52 Delano, Hon. F. A., resignation of, as member of the Federal Reserve Board. 84 Denver branch, directors and manager of 257 Deposits: Government, holdings of 3,118,122,123 Net, holdings of all Federal Reserve Banks each Friday 9,10,124,125 Chart showing movement 126 Reserve deposits of member banks, increase in 13,17 Depreciation charges: Bank premises 31 Federal Reserve notes and Federal Reserve bank notes 31 Furniture and equipment 31 Government securities 31 Detroit branch, directors and manager of 255 Directors of Federal Reserve Banks: Election of, amendment to act regarding 80, 261 List of 253-258 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

880 INDEX TO PART I. Page. Directors, officers, etc., of member banks, fees to, amendment to act regarding. 81, 263 Directors and officers of national banks, amendment to Revised Statutes prescribing penalties for false statements, embezzlement, etc 81, 265 Directory of the Federal Reserve Board and Federal Reserve Banks 253-258 Discount rates: Acceptances 19-23 London 19-22 Policy of Board in establishing 22 Adjusted by Board to assist in distribution of Treasury issues 5 Average charged on all paper discounted 170-171 Bank of England 20 Changes in— During 1918 5-8 1914-1918 91-93 Increase in, approved by Board 5 Preferential rate on notes secured by Government war obligations 5 Discounts: Acceptances, amounts discounted during 1918 167,187,189 Agricultural paper, amounts discounted 150-160 Average balances for year, also amount and annual rate of earnings 192 Collateral notes secured by war obligations, amounts discounted during year 164-166 Commercial paper discounted during year 187,189 Customers' paper discounted during year 164,165 Earnings, rate and amount 28,192,211 Holdings of Federal Reserve Banks 118-121,128 Chart showing movement 1 119 Live-stock paper discounted during year 159-160 Maturities, bills discounted 154-161,171 Maturities of holdings of each Federal Reserve Bank 128 Member banks— Amount discounted for . 162-163,189 Bills discounted for, by months, distributed by maturities 154-161 Number accommodated during 1918 162-163,170 Paper discounted and held, secured by war obligations and otherwise secured 9-13,120-121 Rediscounts between Federal Reserve Banks 3, 4,175-182 Total during 1918, by months 168 War paper— Amount discounted during 1918 164-165,168,187 Chart showing 169 Amount held on each Friday 120-121 Chart showing 119 Ratio to total paper discounted during 1918 168 War obligations, paper secured by 187 Districts, Federal Reserve. (See Federal Reserve districts.) Dividends of the Federal Reserve Banks 28, 209, 213 Dollar exchange bills, holdings of 12 Drafts. (See Acceptances.) Earning assets of Federal Reserve Banks: Average balance of each class, also amount and annual rate of earnings.. 192 Comparison between first and last Fridays of the year 12,13 Movement, of, on each Friday during year, chart showing 119 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

INDEX TO PART I. 881 Earnings: Page. Acceptances, amounts and annual rate 192 Amounts and annual rate of, on each class of earning assets 192, 211,2X5 Annual rate on total investments 28,193-194 Discounts, amounts and annual rate 192 Dividend payments 28, 209, 213 Franchise tax, amount set aside 28, 209, 213 Gross and net 29, 211 Municipal warrants 12,192 Rates of earnings from investments 28 Surplus fund, amount carried to 28, 209, 213 United States securities, amounts and annual rate 192 Earnings and expenses of the Federal Reserve Banks 28, 209-215 El Paso branch, directors and manager of 257 Employees: Federal Reserve Banks 29, 244-246 Federal Reserve Board 85, 247-249 England, bankers' acceptances, discount rates on, in London 20 Equitable Trust Co., New York, foreign branches of 61 Examiners, national-bank, number and salaries 250-252 Executor, administrator, etc., powers granted to national banks. (See Fiduciary powers.) Expenses: Federal Reserve Banks 209-215 Federal Reserve Board 85, 216 Export of coin, currency, and bullion 35, 38, 260 Regulations, revision of, relative to amounts carried by travelers leaving the country 36 Licenses granted by Federal Reserve Board 37, 260 Farmers Loan & Trust Co., New York, foreign branches of 61 Federal Advisory Council: Meetings of 84 Members of 259 Recommendations of. (See Index to Part III, pp. 906-913.) Federal Reserve Act, amendments to 79-81,261-266 Passed September 26, 1918— Section 4—Directors of Federal Reserve Banks, election of 80,261 Section 11 (k)—Fiduciary powers 71,80, 262 Section 16—Federal Reserve notes in large denominations 80, 263 Section 19—Classifying banks in outlying districts of reserve cities.. 80, 263 Section 22—Fees to officers, directors, etc., of member banks 81, 263 Pending amendments— Section 7—Earnings of Federal Reserve Banks paid into surplus fund. 81 Section 10—Permitting members of the Federal Reserve Board to serve as officers or directors of member banks 82 Section 11—Loans in excess of 10 per cent of capital and surplus... 82 Section 13—Providing additional facilities for engaging in foreign transactions 24 Section 25—Branches of national banks 83 Section 25—Federal incorporation of associations engaged in foreign banking 61, 62 100823°—19 56 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

882 INDEX TO PART I. Federal Reserve Act, amendments to—Continued. As amended by— Page. Third Liberty Loan Act 79,80 War Finance Corporation Act 79 Pittman Act 77,79, 80 Membership of State banks and trust companies 24 Reserve requirements, effect of amendment of June 21, 1917 17 Federal Reserve agents: Conference of, suggestions relative to additions to par list 75 List of 253-258 Reports of. (See Index to Part II, pp. 890-905.) Federal Reserve bank notes 77-79 Cost of, charged against current expense account 31 In circulation each Friday 9-10,122-123 Increase in 18 Issued under provisions of Pittman Act 80,114 Printed, issued, and held by Comptroller 111-113 Retirement of 78 Federal Reserve Banks: Bank premises 30-32 Depreciation charges on 31 Branches of 72 Directors and managers of— Baltimore 254 Birmingham 255 Cincinnati 254 D enver 257 Detroit 255 El Paso 257 Jacksonville 255 Little Rock 256 Louisville 256 Memphis 256 New Orleans 255 Omaha 257 Pittsburgh 254 Portland, Oreg 258 Salt Lake City 258 Seattle 258 Spokane 258 Directors of, amendment to Federal Reserve Act relative to election of. 80,261 Dividends of 28,209,213 Earning assets of. (See Earning assets.) Earnings and expenses of 27-30,209-215 Effect of war financing upon. 14 Employees, number and salaries. 29,244-246 Fiscal agency operations. (See Fiscal agency operations). Franchise tax, amount reserved for 28, 29, 81, 209, 213 Governors of 253-258 Local agents of Foreign Exchange Division 58 Officers and directors, list of 253-258 Officers and employees, number and salaries 29,244-246 Rediscount operations between. (See Discounts; Rediscounts.) Resources and liabilities. (See Resources and liabilities.) Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

INDEX TO PART I. 883 Federal Reserve Board: Page. Assistance rendered the Treasury in war finance policy 86 Capital Issues Committee— Establishment of 64 Personnel of 64 Work of 65 Delano, Hon. F. A., resignation of, as member of 84 Directory of 253 Discount policy of 4 Division of Analysis and Research, establishment of 62, 248 Division of Audit and Examination 247 Division of Foreign Exchange 46-59,249 Division of Issue and Redemption 249 Division of Law 66, 247 Division of Reports and Statistics 64, 248 Employees of 85,247-249 Expenses of 85,216 Federal Advisory Council, conferences with 84 Members of 253 As officers or directors of member banks, amendment to act regarding. 82 Organization, staff, etc 84, 253 Personnel of, changes in 84 Policy of, in establishing discount rates for acceptances 22 Policy of, relative to shipments of gold to Mexico 37 Receipts and disbursements of 85,216 Regulations regarding control of foreign exchange 39-46 Salaries of officers and employees 247-249 Secretary, resignation of H. P. Willis and appointment of J. A. Broderick. 85 Secretary, assistant, appointment of W. T. Chapman and L. C. Adelson. 85 Strauss, Hon. Albert, appointed as member of 84 Warburg, Hon. Paul M., expiration of term as member of 84 Federal Reserve districts: Counties in divided States 871-876 Description of 871-876 Map showing outline of 871 Population of 871-876 Federal Reserve notes: Amendment to act authorizing printing of notes in large denominations.. 80,263 Collateral held against (see also Reserves) 95, 97-99 Cost of printing, etc 114, 214 Cost of, to be charged against current expense account 31 Held by Federal Reserve Banks, last Friday each month 96 Held by all Federal Reserve Banks combined, each Friday during year.. 97-99 Held by Comptroller December 31,1918, by denominations 102-103 Held by each agent December 31, by denominations 109 In circulation— Increase in 13 Each Friday for all Federal Reserve Banks combined. 9-10, 97-100,122-125 Chart showing 101 On last Friday of each month 96 Issued to each Federal Reserve Bank, by denominations 104-105,107-108 Issued to banks as of last Friday of each month 94-95 Interdistrict movement of 115-116 Large denominations, amendment to Federal Reserve Act regarding... 80,263 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

884 INDEX TO PART I. Federal Reserve notes—Continued. Page. Mutilated notes received and destroyed 110 Outstanding— Increase in 17 On Dec. 31, 1918, by denominations.... 104-105 Each Friday during year, by all Federal Reserve Banks combined.. 97-99 Printed, up to Dec. 31, by denominations 102-103 Received by each agent up to Dec. 31, by denominations 106 Received from comptroller and held last Friday of each month 94 Redemption of, through gold-settlement fund 1 34 Retired, by denominations 104-105 Returned by banks to agents, by denominations 106-107 Returned to comptroller for destruction, by denominations 108 Shipped to each agent, by denominations 102-103 Fiduciary powers: Amendment to section 11 (k) of Federal Reserve Act 71,80,262 Granted to national banks 71, 235-240 First National Bank of Boston, foreign branches of 61,234 First National Corporation, of Boston, foreign branches of 60 Fiscal agency operations of the Federal Reserve Banks 1-3, 214 Amounts of Liberty bonds and certificates of indebtedness subscribed for and collected through Federal Reserve Banks. 2, 207-208 Disbursements and reimbursements on account of 214 Effect of, on gold-settlement fund 34 Federal Reserve Banks as fiscal agents of War Finance Corporation 79 Foreign branches of American banks 59-61,234 Amendment to section 25 of act recommended, providing for Federal incorporation of associations engaged in foreign banking 61,62 Foreign branches of national banks 60,234 Foreign exchange: Purchases and sales of, by dealers 53 Regulations regarding 39-46 Trading with the enemy act 80 Foreign Exchange Division of the Federal Reserve Board 46-59,249 Administrative department 46 Employees of '. 46 Federal Reserve Banks, local agents of 58 Registration by, of dealers in foreign exchange 52 Research bureau 48 Statistical department : 51 Franchise tax, amount reserved for, by Federal Reserve Banks 28,29, 81,209,213 Furniture and equipment of Federal Reserve Banks 31, 214 "Free gold." (See Reserves, excess.) Gold: Conservation of, provided by Pittman Act 78 Exports of 35-38,260 Allowance for travelers' funds 36 Canadian currency and silver, regulations relative to shipment of... 36 Licenses granted by the Federal Reserve Board, September- December, 1918 260 To Mexico 37,38,260 Totals of coin, bullion, and currency authorized for export 37,260 Reserves. (See Reserves.) Gold fund, international, proposed establishment of 35 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

INDEX TO PART I. 885 Page. Gold-redemption fund, payment for, through gold-settlement fund 34 Gold-settlement fund: Changes in ownership each week 199-203 Effect of fiscal agency operations on 34 Important part played in fiscal agency operations 34 International, proposed establishment of 35 Leased-wire service to expedite daily settlements 32 Operations of 32-35,195-198 Payments through, for gold-redemption fund 34 Transactions through, during war period 34 Summary of transactions 32-35,195-198 Volume of clearings and transfers during the year 33 Weekly operations of, for all banks and New York bank 196-197 Chart showing 198 Government bonds. (See Liberty bonds; United States securities.) Government deposits. (See Deposits.) Government financing. (See Fiscal agency operations.) Governors of Federal Reserve Banks 253-258 Guaranty Trust Co. of New York, foreign branches of 61 India, exports of silver to 37,260 Interest rates. (See Discount rates.) International Banking Corporation of New York, foreign branches of 60 International gold fund, proposed establishment of 35 Investment operations of Federal Reserve Banks 154-194 Jacksonville branch, directors and manager of 255 Law division, Federal Reserve Board 66,247 Legislation. (See Federal Reserve Act; Revised Statutes.) Liberty Bond Act, Third: Section 8 of, amending Federal Reserve Act 79,80 Supplement to, amending section 5200, Revised Statutes 80 Liberty bonds: Allotments of third and fourth loans 2 Amounts subscribed and collected through Federal Reserve Banks 2 Work of Federal Reserve Banks in floating • 1-3 (See also United States securities.) Licenses granted by Board for export of coin, bullion, and currency 37,260 Little Rock Branch, directors and manager of 256 Live-stock paper discounted 159-160 London, discount rates on bankers' acceptances in 20 Louisville branch, directors and manager of 256 Map showing outlines of Federal Reserve districts 871 Maturities: Acceptances purchased and held December 27 by each Federal Reserve Bank 129 Acceptances purchased during year, by maturities 174 Discounts, average maturity of bills discounted during year 171 Discounts, member banks, by months and districts 154-161 Discounts held on December 27 128 Paper held by all Federal Reserve Banks on last Friday of each month.. 118 Member banks' collateral notes. (See Discounts.) Member banks: Amendment to act regarding fees, etc., to officers and directors of 81,263 Discounts for. (See Discounts.) Digitized for FRFAoSrEeiRgn branches of 59-61 http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

886 INDEX TO PART I. Member banks—Continued. Page. Members of Board as directors or officers of 82 Number accommodated during 1918 through discount of paper 162-163,170 Number in each district at end of year 75, 204, 206 Number in each State 162-163 State bank members— Amendment to section 9 of act 24 American Bankers Association, campaign by, for 26 Growth in membership, 1917-1919 . 26 List of, admitted to system 218-233 Movement of membership during 1918, also ratio of number and re sources of members to total State banks eligible for membership.. 26,27 Ohio Superintendent of Banks, extract from report of c 25 Released from restrictions of Clayton Act by amendments to section 9 of the Federal Reserve Act 24-25 Resources of 26 Memphis branch, directors and manager of 256 Mercantile Bank of the Americas, New York, foreign branches of 60 Mexico, exports of gold to 37, 39, 260 Municipal warrants: Average balances for year, also amount and annual rate of earnings 192,211 Holdings of, by Federal Reserve Banks 12 Purchased during year 188,190 National bank examiners 250-252 National bank notes, signatures on 83 National banks: Branches of— Amendment to act, proposed 83 Foreign 60,234 Fiduciary powers granted to 235-240 Amendment to act relative to 262 National City Bank of New York, foreign branches of 60, 234 New Orleans branch, directors and officers of 255 Nonmember banks: Number in each district at end of year 204 Number on par list, by districts 75 Officers and directors of Federal Reserve Banks 253-258 Officers and directors of member banks, fees to, amendment to act regarding.. 81, 263 Officers and directors of national banks, amendment to Revised Statutes prescribing penalties for false statements, embezzlement, etc 81, 265 Officers and. employees: Federal Reserve Banks 244-246 Federal Reserve Board 247-249 Ohio Superintendent of Banks, extract from report of, relative to State bank membership 25 Omaha branch, directors and manager of 257 Open market operations : Acceptances, purchases of 3,18,19,172-174 London 21 (See also United States securities; Municipal warrants.) Far list. (See Check clearing and collection.) Fittman Act: Amending the Federal Reserve Act 77, 79 Federal Reserve bank notes issued under 114 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

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INDEX TO PART I. 887 Page. Pittsburgh branch, directors and manager of 254 Population of Federal Reserve districts 871-876 Portland branch, directors and manager o:f 258 Profit and loss account during year, Federal Reserve Banks 213 Quarters of Federal Reserve Banks 30-32 Rates: Acceptance 19,22 Discount. (See Discount rates.) Rates of earnings. (See Earnings.) Rediscount operations between Federal Reserve Banks 3-4,175-182 Bankers acceptances, open market purchases of, growth in 3 Crop moving requirements 4 (See also Discounts.) Regulations : Export of gold coin, bullion, and currency 35 Foreign exchange 39-46 Funds allowed to travelers leaving country 36 Reports and Statistics, Division of 64, 248 Reserve and central reserve cities: Amendment to section 19 of Federal Reserve Act relative to classifying banks in outlying districts 80, 263 Policy of Board to designate branch bank cities as reserve cities 72 Reserves: Amount held each Friday 9-10 Charts showing movement of total cash and excess reserves for all Fed eral Reserve Banks 126,127 Effect of amendment to act, on reserve requirements 17 Effect upon, by flotation of Liberty loan 13 Equalization of, between Federal Reserve Banks 3 Excess, held by all Federal Reserve Banks each Friday 124-125 Gold available against Federal Reserve note circulation 100 Chart showing 101 Gold, increase in 14 Gold settlement fund transactions, bearing of, on reserve position 33 Member bank reserve deposits, increase in 13,17 Percentage each Friday, combined figures for all Federal Reserve Banks.. 9,10 Percentage against Federal Reserve note circulation 100 Reserve position of Federal Reserve Banks 13-14 Required against deposit liabilities 100,124-125 Chart showing 101 Required against net deposits and note liabilities 124-125 Ratio of, to net deposits and note liabilities 124-125 Total cash reserves of all Federal Reserve Banks.. 9,10,86,100,120-121,124-125 Chart showing 101 Resources and liabilities of Federal Reserve Banks: Changes in, since entry of United States in war 14-17 In detail, Dec. 31, 1918 133-153 Movement of 8-13 Principal items on each Friday during year 9-10,120-123 Figures for last Friday each month 117-118 Statement showing movement during financing of war 14-17 Resources of State member banks 26 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

888 INDEX TO PAKT I. Revised Statutes, amendments to: Page. Section 5172—Engraving signatures on national-bank notes 83 Section 5200—Limiting loans to any one person 80 Sections 5208 and 5209—Penalties for false statements, embezzlement, etc 81,265 Salaries: Nationax-oank examiners 250-252 Officers and employees of Federal Reserve Banks 244-246 Officers and employees of Federal Reserve Board 247-249 Salt Lake City branch directors and manager of 258 ; Seattle branch, directors and manager of •. 258 Silver bullion, price of 78 Silver certificates, retirement of, under Pittman Act 77 Silver: Exports of— Licenses granted by Federal Reserve Board, Sept.-Dec, 1918 37, 260 To Canada, China, India, and the United Kingdom 36, 37, 260 Federal Reserve bank notes issued in lieu of 78 Retirement of silver certificates and breaking up of silver dollars under Pittman Act 78 Spokane branch, directors and manager of ^ 258 Staff of the Federal Reserve Board 84,247 Stamp taxes on Government obligations repealed 80 State bank and trust company members. (See Member banks). Sterling bills of exchange 22 Strauss, Hon. Albert, appointed as member of the Federal Reserve Board.. 84 Surplus account of Federal Reserve Banks: Amount carried to, at end of year 29,209,213 Per cent of surplus to paid-in capital 28-29, 210 Proposed amendment to act relative to 81 Tax certificates. (See United States securities.) Tax: Franchise, amount reserved for, by Federal Reserve Banks 28,29,213 Stamp, on Government obligations repealed 80 Taxes, certificates of indebtedness issued in anticipation of 2 Telegraph service, leased-wire system 32, 77 Trade acceptances. (See Acceptances.) Trading with the Enemy Act, amendment to, re foreign exchange transactions. 80 Travelers leaving the country, revision of regulation relating to funds carried by 36 Treasury notes. (See United States securities.) Trust powers granted to national banks. (See Fiduciary powers.) Trust companies. (See Member banks.) United Kingdom, exports of silver to 37,260 (See also England.) United States securities: Average balances for year, also amount and annual rate of earnings 192 Bonds— Allotments of Liberty bonds by Federal Reserve districts 2 Amounts purchased by Federal Reserve Banks during year. 183-184,187,189 Holdings December 31, 1917 and 1918, by classes 131-132 Redeemed by United States Treasury 186 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

INDEX TO PART I. 889 United States securities—Continued. Certificates of indebtedness— . Page. Allotments by Federal Reserve districts 2, 207-208 Amounts purchased by Federal Reserve Banks during year. 185,186,188,190 Holdings December 31, 1917 and 1918, by classes 131-132 Subscriptions to third and fourth loan certificates 207-208 Earnings, amount and annual rate of 28,192,193, 211 Holdings of 120-121,131-132 Holdings of paper secured by United States securities 9,10 Total purchased during 1918 187-190 Treasury notes, one-year— Purchased during the year 187,190 Holdings December 31,1917 and 1918 131-132 Redeemed by United States Treasury 186 Vaults, cost of, to be charged to current expense account 31 War Finance Corporation, Federal Reserve Banks as fiscal agents of 79 War Finance Corporation Act: Capital Issues Committee, establishment of, under 66 Sections 13 and 15, amending the Federal Reserve. Act 7^ Section 20, amending section 5202, Revised Statutes 79 Section 301, repealing stamp tax •. 80 War financing, effect of, upon the Federal Reserve Banks 14-16 War paper: Amount discounted during year 164-165,168,187 Chart showing 169 Amount held each Friday during year 120-121 Chart showing 119 Discount rates on. (See Discount rates.) Ratio to total paper discounted during 1918 168 Chart showing 169 War obligations, paper secured by 187,189 (See also United States securities.) Warburg, Hon. Paul M., expiration of term of, as member of Federal Reserve Board 84 Warrants, municipal. (See Municipal warrants.) Willis, H. Parker, resignation of, as secretary of Federal Reserve Board 85 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

INDEX TO PART II—REPORTS OF FEDERAL RESERVE AGENTS. Page. District No. 1—Boston -... 269-315 Acceptances 291 Bankers' 272 Held 295 Liability 294 Permission to accept up to 100 per cent 296 Purchased 294 Trade 272 Bank clearings in district 314 Bank examinations 276 Banking quarters * 283-284 Bills rediscounted 293 Building committee, members of. 284 Business conditions 270, 315 Business readjustment 284 Capital Issues Committee 279,311 Certificates of indebtedness 277-278, 281 Receipts from 290 Redeemed 310 Sales and payments 303, 304 Check clearing and collection 282-283 Commercial failures 315 Commercial paper, maturity of 291 Condition of national banks 302 Credit department 276 Deposit and note liabilities 288 Deposits 276-277 Directors, election of 282 Discount operations 271-272 Discount rates 313 Dividends 269 Earning assets 292 Movement of 285-286 Earnings 269 Net 289 Examination of banks 276 Federal Reserve bank notes 280 Federal Reserve notes 280, 311 Fiduciary powers granted to national banks 275,301 Financial results of operation 269-270 Gold settlement fund 283, 300 Income and expense 289 Internal organization of bank 281-282 Invested funds, maturity of 291 890 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

INDEX TO PART II. 891 District No. 1—Boston—Continued. Liberty bonds: Page. Conversions 309 Subscriptions 307,308 Liberty loan campaigns 278 Liberty loan receipts 290 Liquidation of bond-secured loans 281 Loans of bank 270-271 Member banks: Number of, in district 275 Relations with 275 State bank members, list of 301 Trust company members, list of 301 Money rates 270,313 National banks: Condition of 302 Reserves of 302 Nonmember banks, relations with 276 Note liabilities 288 Officers, election of 282 Quarters of the bank 283-284 Rediscounts 291 For member banks 302 Relation with member and nonmember banks 275-276 Reports, weekly and call 277 Reserves 277 Member banks 299 Fluctuations in, reasons for 274 Gold 298 Movement of cash 287 National banks 302 Percentages 297 Reserve position 296 Resources and liabilities 290 State banks, list of member 301 Trust companies, list of member 301 United States securities bought and sold 273-274 'War Finance Corporation 280 War-savings certificates 279 War-savings stamps 310 District No. 2—New York 317-398 Acceptances— Bankers' 324-327 Trade 327-328 Advisory council, member of 347 Advisory trades committee 355 Bank premises 346 Bankers' acceptances 324-327 Bond operations, United States 328 Branches of banks, foreign 341 Business conditions 371 Capital issues committee 367-369 Cash reserves, movement of 382-383 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

892 INDEX TO PAKT II. District No. 2—New. York—Continued. Page. Certificates of indebtedness 348-349, 390 Purchase of ". 323, 328 Quota 335 Clearings and collections 330-332 Crops, local. 375 Currency shipments 344 Deposit and note liabilities 383 Directors— Election of 346-347 Meetings of 342 Discount rates 318,319,385 Discounts— For year 323 Maturity of 328 Of member banks 322 Dividends 318 Earning assets— Chart of 321, 372 Movement of 380, 381 Earnings and expenses 317-318,385 Employees— Number of 343,389 In military service 396-397 Examiner, Federal Reserve 344 Expense and income statement 385 Federal Reserve notes 329-330, 393-394 Fiduciary powers granted 335, 395 Financial conditions in district 369-371 Fiscal agency operations 347-348, 364 Foreign banks, relations with 338-342 Argentina 340 Bank of England 339 Bank of France 339 Bank of Italy 339 Bank of Japan 339 Bolivia 340 De Nederlandsche Bank 339 Indian Government 340 Norges Bank .' 340 Peru 340 Philippine National Bank 339 Sveriges Riksbank '. 340 Foreign branches of American banks 386-388 Foreign exchange, dealers in 342 Foreign trade 379 Gold reserves, chart of 321 Gold settlement fund 332-334, 394 Telegraphic transfer system 333 Government checks handled 364 Government deposits 362-363 Income and expense 317-318, 385 Industries and staples 374 Internal management of bank 342 Digitized for FRIAnSvEesRt ments of bank 319-323 http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

INDEX TO PART II. 893 District No. 2—New York—Continued. Page. Labor conditions 373-374 Liberty bond conversions 362 Liberty loan— Campaigns 350-352,355-360 Advertising bureau 360 Advisory trades committee 355 Foreign language bureau 360 Metropolitan canvass committee 355 Speakers' bureau 360 Woman's committee 356 Central committee 353 Expenses , 364, 392 Financing of 319 Organization 351-352 Partial payment 356-358 Publicity 358-361 Press bureau 359 Feature bureau 359 Receipts 361 Sales organization 353 In Metropolitan district 355 Outside Metropolitan district 354 Sales through bank 348 Subscriptions 390-392 Loans and investments, classification of 370 Member banks 334, 337 Discounts of 322 Number of 334 Relations with 334 State banks admitted in 1918 386 Money rates 375-376 Municipal warrants, purchase of 328 New York Clearing House— Collection through 331-332 Relations with 337-338 Nonmember banks, relations with 334, 336-337 Notes issued, Federal Reserve 329-330 Officers, number of 343 Organization of bank 342-345 Proceeds of items, when available 397-398 Quarters of bank 346 Relations with banks in district 334, 336-337 Relations with Clearing House Association 337-338 Relations with foreign banks 338-342 Reserve against liabilities 322 Reserve penalties 336 Reserve requirements, change in 336 Resources and liabilities 384 Salary increase of employees 343 Securities market •. 377-379 Stabilization of the money market 365-367 Surplus 318 Trade acceptances 327-328 Digitized for FRWASaEr-Rsa vings stamps 365 http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

894 INDEX TO PART II. Page. District No. 3—Philadelphia 399-450 Acceptances— Bankers' 402-403 Permission to accept up to 100 per cent 410 Trade 402 Assets and liabilities 429-431 Bank clearings 417-418,450 Bankers' acceptances 402-403 Banking conditions in district 408 Banking quarters 406 Banking resources in district 447 Bills discounted for members 402 Business conditions 415-417,420-425 Capital Issues Committee : 414-415 Cash reserves, movement of 427-428 Certificates of indebtedness 413 Check clearing and collection 406,445 Clayton Act applications 411 Clearing-house members 448 Coal production in district 417 Commercial failures 418 Coupon department 407 Deposit and note liabilities 428 Directors, election of 404-405,443 Discount rates 400 Earning assets— Daily holdings 436-437 Movement of 425-426 Earnings and expenses 432-433 Employees 406 Examination, department of 406 Expenses 432^33 Federal Reserve bank notes 404-442 Federal Reserve notes 403,440-442 Fiduciary powers granted 410-411 Fiscal agency of United States 411 Freight-car movements 419 Gold settlement fund operations 443-444 Imports and exports 419 Internal organization of bank 404-408 Investment operations 401,436,439 Liberty loan bond holdings of national banks 409 Liberty loan campaigns 411-413 Liberty loan subscriptions 448-449 Loans and investments 437 Earnings from 438 Member banks, relations with „ 408^409 Officers of bank 404-405 Post-office business 419-420 Profit and loss statement 432 Quarters of bank 406 Reserve position of bank 400,434-435 Reserves, movement of 427-428 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

INDEX TO PART II. 895 District No. 3—Philadelphia—Continued. Page. Resources and liabilities 429-431 Agent's account 440 Member national banks 447 Results of operation 399-400 Rhoads, C. J., resignation of, as governor 404-405 State bank members 448 Territory comprising district 408 Trust company members 448 District No. 4—Cleveland 451-481 Acceptances— Bankers' : 453-454 Permission to accept up to 100 per cent 454 Purchased 469 Trade 453-454 Banking conditions in district 451-452 Banking quarters 461 Branches of Federal Reserve Bank 460 Business conditions in district 451-452 Capital Issues Committee 458,477-478 Certificates of indebtedness 456-458,471-476 Check clearings and collection 480 Cincinnati branch, operation of 460 Deposit and note liabilities...-. 465 Depositaries' department 474 Discount operations 452,468 Dividends 451 Earning assets 467-468 Movement of 462-463 Earnings 451,467 Employees 461 Examinations, State bank members 456 Expenses 451,467 Federal Reserve bank notes 459,479 Federal Reserve note liabilities 464-465 Federal Reserve notes issued and redeemed 459,479 Fiduciary powers granted to banks 471 Fiscal agency operations 456 Gold settlement fund operations 481 Investments 468 Liberty loan organization 456-458 Liberty loan subscriptions 475 Liquidation of bond secured loans 459-460 Liquidation of member banks 469 Loans 468 Member banks 455 Liquidation of 469 National ' 455-456 New 470 Number of 469 State 456 Trust companies 456 National banks, new 470 Nonmember banks on par list 461 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

896 INDEX TO PART II. District No. 4—Cleveland—Continued. Page. Officers 460 Organization of bank 460-461 Pittsburgh branch, operation of 460 Position of commercial banks 459 Profit and loss account 467 Rediscounts 468 Relations with national bank members 455-456 Relations with State bank members 456 Relations with trust company members 456 Reserve position of bank 454 Reserves, movement of 464-465 Resources and liabilities 466,479 State banks admitted to system 470 United States securities purchased 469 War-savings stamps... 457-458,476 District No. 5—Richmond 483-509 Acceptances— Bankers' 484,488 Permission to accept up to 100 per cent 485 Trade 484 Assets and liabilities 502 Baltimore branch operations 493-494 Banking conditions in district '. 483-484 Banking quarters 495-496 Bills discounted and bought 503-504, 508 Branch bank operations. 493-494 Business conditions in district.. 483-484 Capital issues committee. ." 490-492 Certificates of indebtedness 489 Check clearing and collection 495,509 Clearing operations, Baltimore branch 508 Deposits 499-500,505 Developments in district 496-497 Discount operations 484 Discount rates 504 Dividends 483, 501 Earning assets, movement of 497-498 Earnings 483,501 Employees, salaries 508 Expenses 483,501 Federal Reserve bank notes 492 Federal Reserve notes 492,499-500,507 Fiduciary powers granted 486-487 Financial results of operation 483 Fiscal agency operations 488 Gold settlement fund 495 Liberty loan organization ;... 488-490 Liberty loan sales 506-507 Liberty loan subscriptions 489 Liquidation of war paper 493 Member banks— Capital stock 505 New 485-486 Digitized for FRASERRe lations with 486-487 http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

INDEX TO PART II. 897 District No. 5—Richmond—Continued. Page. Officers of Baltimore branch 493-494 Officers, salaries 508 Organization of bank 494r-495 Position of commercial banks 492-493 Profit and loss 501 Quarters of Baltimore branch 493 Relations with national banks 486 Relations with State banks and trust companies 487 Reserve fund laws, by States 487 Reserve position of bank 485 Reserves, movement of 499-500 Resources and liabilities 502 Salaries, officers and employees 508 War savings stamps 507 District No. 6—Atlanta 511-538 Acceptances— Bankers' 514 Purchase of 514-515 Trade 514 Banking conditions in district 512-513 Banking quarters 526-527 Birmingham branch 524 Branch banks 524 Business conditions 512-513, 523 Capital issues committee 521-522 Certificates of indebtedness 519, 533-534 Check clearing and collection 525-526 Commercial paper market 523 Credit expansion 523 Deposits, net 529-530 Deposit of Treasury funds in banks 520 Discount operations 513-514 With national banks 517 With State banks and trust companies 518 Dividends 511, 533 Earning assets, movement of 527-528 Earnings and expenses : 511, 531, 533 Examinations of State bank members 519 Expenses 511,531,533 Federal Reserve bank notes 522-523 Federal Reserve note issues 522 Federal Reserve note liabilities 529-530 Fiduciary powers granted 518 Financial results of operation 511 Fiscal agency operations 519,521-522 Gold settlement fund 526 Interest rates 513 Jacksonville branch 524 Liberty loan, flotation of 520 Liberty loan subscriptions 534-537 Liquidation of war paper 524 Member banks, new 516-517 100823°—19- 57 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

898 INDEX TO PAKT II. District No. 6—Atlanta—Continued. Paga. Organization of bank 525 Position of commercial banks 523 Profit and loss statement 512 Quarters of bank 526-527 Rediscounts— Commercial paper 513 Liberty loan : 513-514 Relations with national-bank members 517-518 Reserve position 515 Reserves— Movement of 529-530 Of State bank members 518 Resources and liabilities 511-512,531-532 State bank members 516-517 Transit operations 537 War Finance Corporation 521 War savings stamps 521 District No. 7—Chicago 539-580 Acceptances— Bankers' 544-545 Permission to accept up to 100 per cent 545 Purchase of 545 Trade 544 Assets and liabilities 541,565 Banking conditions 539-540 Banking quarters 560 Branch bank, Detroit 555 Business conditions 541-542 Capital issues committee 553-554,576-577 Certificates of indebtedness .< 549,570-572 Check clearing and collection 557-559,578-579 Deposits 541 Government 541 Net 563-564 Of Treasury funds with banks 549-550 Detroit branch 555 Balance sheet 565 Discount operations 542-544 Discount rates 560 Earning assets, movement of 561-562 Earnings 540 Examinations, department of 547-548 Expenses 540 Federal Reserve bank notes 554,577 Federal Reserve note liabilities .' 563-564 Federal Reserve notes 539,554,577-578 Fiduciary powers granted 547,570 Financial results of operation 540-541 Foreign accounts 560 Gold settlement fund operations 560,580 Investment operations 543 Leased-wire system 558-559 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

INDEX TO PART II. 899 District No. 7—Chicago—Continued. Liberty loan— Page. Campaign 550 Organization 575-576 Quota 548 Subscriptions 539, 572-575 Liquidation of national banks 568 Member banks— Authorized to accept up to 100 per cent 567 New 546,567-569 Money rates 567 National bank members, new 567 Organization of bank 556 Position of commercial banks 554-555 Profit and loss statement 566 Quarters of bank 560 Reserve position 545-546 Reserves— Cash 540 Movement of 563-564 Of State banks 548 State bank members 546, 568-569 Telegraphic transfer system 557-559 War Finance Corporation 553 War-savings stamps 552 District No. 8—St. Louis 581-622 Acceptances— Bankers' 585 Permission to accept up to 100 per cent 585 Purchased 612-613 Trade 585 Banking conditions 582-583 Banking quarters : 602-603 Bills discounted 581, 597 Branches of Federal Reserve Bank 598-599 Business conditions in district 582-583 Capital issues committee 593 Cash reserves 582 Cash reserves, movement of 605-606 Certificates of indebtedness 588-589, 596, 614-616 Checks of United States Treasurer handled 621 Clearings and collection 600-602 Commercial paper market 597 Coupons of United States handled 621-622 Debits and credits of bank 622 Deposit of Treasury funds with banks 590 Deposits, net 586,605-606 Discount operations 584 Discount rates 612 District items handled by bank 619-621 Dividends 581 Earning assets 581-582 Movement of 603-604 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

900 INDEX TO PART II. District No. 8—St. Louis—Continued. Page. Earnings 581 Employees 600 Examination of State bank members 588 Expenses 581 Federal Reserve bank notes 596 Federal Reserve notes : 586, 594-596, 605-606,617-619 Fiduciary powers 587, 614 Fiscal agency operations 588 Gold settlement fund 602 Liberty loan bonds 584, 596 Liberty loan— Flotation of. 590-591 Organization 591 Subscriptions 616-617 Little Rock branch 598-599 Louisville branch 598 Member banks 584 Number of 586-587 Relations with 587-588 State and trust companies 614 Memphis branch .• 598 Officers 600 Organization of bank 599-600 Paper discounted, volume of 609-611 Position of commercial banks 596-597 Profit and loss statement 607 Relations with national bank members 587-588 Relations with State banks and trust companies 588 Reserve position 586 Reserves 582, 605-606 Resources and liabilities 581, 607-608 State bank members 586-587, 614 State bank nonmembers 587 War Finance Corporation 593 War-savings stamps 591-593 District No. 9—Minneapolis 623-651 Acceptances— Domestic and foreign 627 Purchased 643 Trade 627, 642 Banking conditions in district 624 Business conditions in district 624-625 Capital issues committee 631-632 Cash reserves, movement of 639-640 Certificates of indebtedness 630, 644 Check clearing and collection 632-633 Clearing statistics 650 Collateral loans 642 Cost of notes 633-634 Deposits— Government 645 Net 639-640 Directors 636 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

INDEX TO PAKT II. 901 District No. 9—Minneapolis—Continued. Page. Discount operations 625-627 Discount rates, changes in 642 Dividends 624 Earning assets, movement of 637-638 Earnings 623 Gross 641 Employees 636 Expenses 623 Federal Reserve bank notes 634, 651 Federal Reserve notes issued 633-634, 651 Federal Reserve note liabilities 639-640 Fiduciary powers granted 629 Financial results of operation 623-624 Fiscal agency operations 629-630 Fiscal agent's report 646-649 Gold holdings 628, 634. 651 Liberty loan— Organization 630 Subscriptions 645 Liberty loan bonds— Converted 647 Delivered 648-649 Held by banks 635-636 Member banks- Number 628 Relations with 628-629 Officers 636 Profit and loss account 641 Rediscount operations 642 For other Federal Reserve Banks 643 Volume of 642 Relations with member and nonmember banks 628-629 Reserve position 627-628 Reserves 639-640 Resources and liabilities 641 Results of war financing 635 Treasury deposits 630 War Finance Corporation 630-631 War savings stamps 630, 649 District No. 10—Kansas City 653-686 Acceptances—• Bankers' 656 Trade 656 Banking conditions in district 653-654 Banking quarters 667-668 Branches of Federal Reserve Bank 663 Business conditions in district 653-654 Capital issues committee 661 Cash reserves 670-671 Certificates of indebtedness 660, 676-677, 684-685 Clearings and collections 666, 667, 681-684 Denver branch 663-665 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

902 INDEX TO PART II, District No. 10—Kansas City—Continued. Deposits— Page. Net 670-671 Of member banks 678 Directors 665 Discount operations 655, 675-676, 677 Dividends 653 4 Earning assets, movement of 668-669 Earnings and expenses 635, 673 Employees 680 Expenses 653 .Federal Reserve bank notes 662 Federal Reserve note liabilities. 670-671 Federal Reserve notes 661-662, 679-680 Fiduciary powers granted 658 Financial results of operation 653 Fiscal agency operations 659-661 Foreign accounts 667 Gold settlement fund 667 Government account 678 Liberty-loan bonds 676-677, 685-686 Liberty-loan subscriptions 660 Liquidations of loans of bank 663 Member banks 656-657, 677-678 Clearings 681-684 Relations with 657-658 Officers 665, 680 Omaha branch 663-664 Open-market transactions 676-677 Organization of bank 665-666 Position of commercial banks 662 Profit and loss account. 672-673 Quarters of bank 667-668 Relations with national bank members 657-658 Relations with State banks and trust companies 658-659 Reserve position 656, 677 Reserves 670-671 Resources and liabilities 674-675 State bank members 657 War Finance Corporation 661 War-savings stamps 661 District No. 11—Dallas 687-728 Acceptances— Bankers' 714 Purchase of 691 Trade 691,713 Balances with war-loan depositaries 721 Banking conditions in district 688-689 Banking quarters * 706 Branches of Federal Reserve Bank 699-700 Business conditions in district 688-689 Capital issues committee 696 Capital stock account 717 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

INDEX TO PART II. 903 District No. 11—Dallas—Continued. Page. Cash reserves 709-710 Certificates of indebtedness 694 Check collection system 703-705 Checks handled 726 Commercial paper, market for 698 Condition of national banks 697 Currency shipped, amount of 727-728 Deposits, net 709-710 Directors 701 Discount operations 692, 693 Discount rates 713 Dividends 687 Earning assets, movement of 707-708 Earnings and expenses 687, 711-712 El Paso branch 699-700 Condition of 726 Officers 702 Examination of State banks 693 Expenses 687 Federal Reserve bank notes 697 Federal Reserve note liabilities 709-710 Federal Reserve notes 697, 722-726 Fiduciary powers granted 693, 718 Financial results of operation 687 Fiscal agency operations 694-696 Gold settlement fund 706, 727 Labor conditions in district 689 Liberty loan bonds, notation of 694 Liberty loan subscriptions 719-720 Liquidation of war paper 698 Member banks 692, 715 Money market 690 Municipal warrants, purchase of 715 National bank members 692 Condition of 718 Officers 701-703 Organization of bank 700-703 Position of commercial banks 697-698 Profit and loss 712 Quarters of bank 706 Rediscounts 712-713 Commercial paper 690 Government obligations 690-691 Relations with national banks 692 Relations with State banks and trust companies 693-694 Reserve city clearing house 705 Reserve position 691 Reserves— Cash 709-710 Maintenance of 704 Of member banks 715 Of State banks 693-694 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

904 INDEX TO PART II. District No. 11—Dallas—Continued. Page. Resources and liabilities 711-712 State bank members 692, 715-717 United States securities held 714 War Finance Corporation 695 War-savings stamps 695 District No. 12—San Francisco 729-760 Acceptances— Bankers' 732 Trade 731 Banking conditions in district 729-731 Banking quarters 743 Banking resources of district 759-760 Branches of Federal Reserve Bank 741-742 Building permits 751 Business conditions in district 729-731 Capital issues committee 737-738, 758 Cash reserves 746-747 Certificates of indebtedness 735-736,754-755 Clearing house settlements 742 Clearings and collections 742-743, 750 Commercial paper 740 Crop production 749-750 Value 749 Deposits, net , 746-747 Discount operations 731, 734 Dividends 729, 748 Earning assets, movement of 744-745 Earnings 729,748 Employees 742 Examinations of member banks 735 Expenses 729,748 Exports and imports 751 Federal Reserve bank notes 739 Federal Reserve note liabilities 746-747 Federal Reserve notes 738-739,758 Fiduciary powers granted 734 Financial results of operation 729 Fiscal agency operations 735-738 Fruit shipments 750 Gold settlement fund 743 Liberty loan— Flotation of 736 Sales 755-757 Liquidation of war paper 740-741 Member banks 733-734, 751-754 Relations with 734-735 National bank members 733, 751 Note issues 738-739 Organization of bank 742 Permission to accept up to 100 per cent 734, 754 Portland branch 741-742 Position of commercial banks ". 740 Quarters of bank 743 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

IHDEX TO PAET II. 905 District No. 12—San Francisco—Continued. Rediscounts— Page. Commercial paper 731 Secured by Liberty bonds 731 Relations with national banks 734 Relations with state bank members 734-735 Reserve position 732 Reserves 735,746,747 Resources and liabilities 748 Salt Lake City branch 741-742 Seattle branch 741-742 Spokane branch 741-742 State bank members 733-734,752-754 "War Finance Corporation 737 War-savings stamps 736-737, 758 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

INDEX TO PART III-RECOMMENDATIONS OF THE FEDERAL ADVISORY COUNCIL. Page. Abrasion on gold, Federal Reserve Banks to sustain loss 844-845 Acceptance power of banks engaged in foreign banking 867 Acceptances and acceptance credits 816 Acceptances: Bankers'— Development of open market for 866 For furnishing dollar exchange 866 Low rates for 801-802 Purchase of 765,767,773-774 Use of 861-862 Available as reserve 870 Banks discounting their own 848 Development of market for 861,862,866,870 Domestic 774-775, 776 Farm loan bonds under Hollis bill 787 Foreign 869-870 Liabilities as an indorser 818 National banks permitted to accept to 100 per cent 822 Of member banks 817-818 Purchase of, based on importation or exportation of goods 774 Revolving credits 816 Trade 781,862 (See also Bills of exchange.) Accepting for any one customer limited 828 Accepting up to 100 per cent of capital and surplus 832-833 Admission of State banks to system 767, 775, 777-781, 782, 814, 821, 830-832, 858 Agencies: Domestic, of Federal Reserve Banks 824 Foreign, of Federal Reserve Banks 783, 797-800, 824 Amendments to Federal Reserve Act 785-787, 819-823, 830-838, 853-858, 869-870 Amendments to National Bank Act 785-787 Amendments to United States Revised Statutes 864 Antitrust act. (See Clayton Act.) Attorneys of banks receiving commissions, etc 837-838 Bank balances ceasing to count as reserve 824-825 Bank balances in reserve cities 817 Bank deposits, guaranty of 860-861 Bankers' acceptances. (See Acceptances, bankers'.) Bankers, private, statements of 789 Banking corporations to do international or foreign banking 855-857 Banks accepting for foreign countries 866 Banks, amendment to act to allow banks to accept up to 200 per cent of capital and surplus 869-870 Banks engaged in foreign banking 859, 866-867 906 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

INDEX TO PART III. 907 Page. Banks, foreign, owned by member banks 797-800 Banks limited to accepting for any one customer 828 Banks permitted to accept up to 100 per cent 832-833 Banks should not invest in public-utility securities 863 Banks, tax on undistributed earnings 864 Bills of exchange: Domestic and foreign 774-775 Drafts 817-818 Liabilities as an indorser 818 Purchase of 768-770 (See also Acceptances.) Bond and capital issues, priorities in 853 Bonds of railroads, etc., paper secured by 849 Bonds, United States: National banks to maintain deposit of 822 2 per cent to be exchanged for 3s 819, 823 Branches: Domestic, of Federal Reserve Banks 824 Foreign, of Federal Reserve Banks 824 Foreign, of national banks 783, 786-787, 859, 866-867 Joint foreign, of member banks 797-800 Member banks to establish 822 Of national banks 783,786-787,816 Of member banks in reserve cities 857-858 Business conditions after cessation of war 787 By-laws of Federal Advisory Council 763-764 Canada, exchange relations with 850 Capital and bond issues, priorities in 853 Capital Issues Committee, functions of 864 Capital issues, supervision of 864 Capital of Federal Reserve Banks, reduced 786, 793-797 Capital, ratio of, to bank deposits 839-842 Central reserve cities. (See Reserve cities.) Certificates of indebtedness. (See United States.) Checks stamped "Collectible at par through the Federal Reserve Bank of —" 814-815 Chicago, Federal Reserve Bank of, resolutions 776 Circulation. (See Federal Reserve notes.) Class C directors of Federal Reserve Banks 823, 830 Classes A and B directors of Federal Reserve Banks 853-854 Clayton Act: Directors of common carriers 803-804 Directors of national banks 783, 786 Clearing and collection 766, 783, 793, 817, 810-815, 817, 827 Intra-district, not made mandatory 783 Privileges at Federal Reserve Banks 870 Facilities of Federal Reserve Banks 821 Collection of checks by member banks 811 Commercial letters of credit. (See Letters of credit.) Commercial paper, circular on 768-770 Committee appointed to confer regarding banks with foreign branches 809-810 Commodity paper, rates for 781, 848 Commodity rates. (See Rates.) Digitized foCr FomRAmSoEn Rc arriers, Interstate Commerce Commission ruling 803-804 http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

908 INDEX TO PART III. Comptroller of the Currency: Page. Duties of 785 Ruling of 799 Credit: Contraction of, how to effect 790-791 No contraction of 867 Credits: Limiting by member banks 853 Nonessential, curtailment of 859, 862 Revolving 816 Criticisms of Federal Reserve Board and Act 800 Currency: Expense of transfers 865 Gold, etc., supplied by Federal Reserve Banks 809, 815 Curtailment of commercial credits 853 Curtailment of nonessential credits 859, 862 Denominations of Federal Reserve notes 854 Depositors of failed banks 860-861 Deposits: Demand, rates paid by member banks 788-789 Of banks guaranteed 839-842, 860-861 Of Government in member State banks 864 Ratio of capital to 839-842 Reserves against 800-801 Savings, rates paid by member banks 788-789 Savings and time,'definition of 766 Time 776 Deputy Reserve agent, title to be abolished 823 Directors: Class C 823, 830 Classes A and B 853-854 Common carriers 803-804 Federal Reserve Banks 814, 823, 830, 853-854 Member banks 799-800, 821-822, 837-838 National banks .. 783, 786 Discount: Market for acceptances. (See Acceptances.) Member banks to discount their 15-day secured notes 809 Policy 790-791, 804-808 Rates. (See Rates, discount.) Discounting between Federal Reserve Banks 771-773, 776, 783 Dividends of Federal Reserve Banks 795-797 Dollar exchange 826,850, 866 Drafts of member banks on Federal Reserve Banks 812-813, 827 Embargo on gold 863-864 Employees of member banks 799-800, 837-838 England. (See Great Britain.) European war, business and financial conditions after 787 Examiners' reports on national banks 782, 784 Excess-profits tax. (See Taxation.) Exchange: On Federal Reserve Banks 827 International 843-844 Market 868 Digitized for FR(ASeSeE aRl so Dollar, Sterling, and Foreign exchange.) http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

INDEX TO PAET III. 909 Page. Executor, trustee, etc., national banks to act as 765 Expense of transfers of currency and securities 865 Expenses of Federal Reserve Banks 795-797 Export of gold and silver restricted 863 Exports facilitated 850 Farm loans 786 Farm loan bonds, Hollis bill 787 Federal Advisory Council, rotation in membership 827 Federal charters for banks doing foreign business 859 Federal Reserve Act: Amendments proposed 785-787, 819-823, 830-838, 853-858, 869-870 Criticisms of 800 Federal Reserve agent to have assistants 823,830 Federal Reserve Banks: Directors of 814, 823, 830, 853-854 Free facilities to member banks 867 Policies to be pursued after peace 867-869 To allow surplus to accumulate 869 Federal Reserve Board: Amendments to act 819-823 Criticisms of 800 Federal Reserve cities, availability of drafts 812-813 Federal Reserve districts, reserve situation 804-808 Federal Reserve notes: Available as reserve 785-787,815 Denominations of 854 Gold to count as reserve against 819 Issued against gold 785-787, 819, 827-828 Outstanding, expansion of 865-866 Reserve against 833-835 Retirement of 834 To take place of gold certificates 788, 825-826 United States 1 year 3 per cent gold notes for issue of 823 Fees, directors of member banks accepting 821-822 Financial conditions after cessation of war 787 Food Administration Grain Corporation, loans to 844-845 Foreign agencies of Federal Reserve Banks and member banks 797-800, 783, 859 Foreign banking business of member banks 809-810 Foreign banking corporations to do international banking 855-857 Foreign banking operations, extension of 859 Foreign bills: Amendments to Act 869-870 Purchased by Federal Reserve Banks. 868 Foreign branches of member banks 797-800 Foreign branches of national banks 783, 786, 859, 866 Foreign business of Federal Reserve Banks 824, 859 Foreign countries: Extension of banking facilities in 866 Informal conferences with 868 Foreign exchange 850 Foreign exchange bank 859 Foreign exchange business of Federal Reserve Banks 774-775, 826 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

910 INDEX TO PART III. Page. Foreign exchange, expert to study 826 Foreign exchange situation 843-844 Foreign policy of Federal Reserve Banks after war 868-869 Foreign trade, extension of 866-867 Forgan, J. B., report on reduction of capital of Federal Reserve Banks 793-797 Gold: Abrasion, loss sustained by Federal Reserve Banks 844-845 Certificates to be retired for Federal Reserve notes 788, 825-826 Committee of Federal Reserve Board to regulate shipments 868 Currency, etc., to be supplied by Federal Reserve Banks 815 Embargo 843-844, 850, 863-864, 868 Exports 843-844,850 Federal Reserve Banks to supply member banks with 809 Federal Reserve notes issued against 785-786, 819 Free market for 868,869 Held by Federal Reserve Agents as reserve 819, 827-828, 833-835 Importations, effect on reserves 824-825 In Federal Reserve Banks, to be accumulated 788 In subtreasuries not to be transferred 825-826 Mobilized in Federal Reserve Banks 819-820 Notes of United States, 1-year, 3 per cent 823 Reserves of Federal Reserve Banks 843-844, 868, 869 Settlement fund, clearance through 812-813 With Federal Reserve Board as part of lawful reserve 835 Government. (See United States.) Great Britain: Free gold market with 868-869 Working arrangement with, after war 868 Guaranty of bank deposits 839-842, 860-861 Harding, Hon. W. P. G., address on acceptances 816 Hayes bill not approved : 828-829 Hollis bill, farm loan bonds as security 787 Imports restricted 850 Intra and inter district clearings. (See Clearings.) Income tax. (See Taxation.) Insurance of bank deposits 839-842 Interest: Member banks to charge customers on collections 811 Paid by member banks for deposits 788-789 International Banking Corporation 855-857 Interstate Commerce Commission, ruling on common carriers. 803-804 Inventories in merchandise, allowance made for increased costs 865 Investments of Federal Reserve Banks 787, 793-797, 802-803 Legislation, pending, taxation 864, 865 Letters of credit: Banks issuing commercial 799,817-818 (See also Bills of exchange.) Liberty bonds. (See United States.) Loans: Contraction of , 790 Farm 786 To allies by United States Government 843-844 To Food Administration Grain Corporation 844-845 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

INDEX TO PART III. 911 Member banks: Page. Borrow from Federal Reserve Banks '. 809 Free facilities of Federal Reserve Banks 867 (See also National banks). Minority report: Reduction of capital of Federal Reserve Banks 795-797 Bank drafts of member banks available 813 Mutual savings banks to become associate members 823 National Bank Act, amendments proposed 785-787,857-858 National banks: Branches of 783, 786-787, 816,822, 857-858 Examiners' reports on 782, 784 Foreign branches of 783, 786 To act as trustee, executor, etc 765 To accept up to 100 per cent of capital and surplus 822 To maintain minimum deposits of United States bonds 822 National Dry Goods Association, recommendations 865 Nonessential credits. (See Credits.) Nonmember banks clearings 793,870 Officers of member banks, receiving fees, etc 799-800,837-838 Paper: Commercial, circular on 768-770 Commodity, rates for 781,848 Customers,' secured by United States bonds 848 Federal Reserve notes to be issued against 100 per cent 819 Secured by bonds of railroads and corporations 849 Penal statute, directors accepting fees 821-822 Policy of Federal Reserve Banks after war 867-868 Priorities in capital and bond issues 853 Private bankers. (See Bankers.) Public utility corporations 849,863 Pyramiding of bank deposits 800-801 Railroads to be financed by United States during war 849 Rates, commodity, no need for preferential 848 Rates: Discount 852,864 Bankers' acceptances 801-802 Notes, 15-day, of member banks 809 Of Federal Reserve Banks 781, 842-843, 851 No change recommended 843-844 Paper secured by acceptances 861-862 Paper secured by Liberty bonds 852, 863 To regulate flow of gold 869 Higher, for money 825 Interest, suggested on Third Liberty loan bonds 852-853 Of public utility corporations, regulation 863 Taxation, on undistributed earnings 864 Record, T. J., minority report, drafts available 813 Rediscounting between Federal Reserve Banks 802-803 (See also Discount.) Reserve agents of national banks 791-792 Reserve cities: Banks to establish branches in 816, 857-858 Increase number of 791-792 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

912 INDEX TO PAET III. Reserve cities—Continued. Page, Pyramiding of bank deposits in 800-801 Reserves of member banks in 855 Reserve: Federal Reserve notes available as 785-786 Seay's argument for putting act into effect 787 Situation in 12 Federal Reserve cities 804-808 Reserves of Federal Reserve Banks: Against Federal Reserve notes 827-828, 833-835, 842-843 Gold 835, 843-844, 868 Minimum percentage of.. .\ 802-803 To be kept strong 787 Reserves, foreign branches of national banks 866-867 Reserves, of member banks 791-792,800-801 Basis of determining to be changed 849-850 Bank balances with reserve agents 817 Excess of 790-791, 815 In Federal Reserve Banks 775-776, 817-819, 810-811, 809,852, 854, 870 Federal Reserve Board raise 821 Federal Reserve notes available as 815 In reserve cities * 849-850 Permission to carry in Federal Reserve Banks 809 Reduced 836-837 Requirements of act to be simplified where State laws interfere 858 Will decrease 824-825 Revolving credits 816 Savings accounts 766, 788 Savings banks: Holding bonds that have depreciated 849 Mutual, to become associate members 823 United States to finance during war 849 Seay, George J., argument for putting reserve provisions into effect 787 Securities and currency to be transferred free 865 Silver exportations, restricted 863-864 State banks: Admission to Federal Reserve System. 767, 775, 776-781, 782,814, 821, 830-832, 858 Allowed fee for collecting checks 817 Hayes bill .. 828 Members, to receive Government deposits 864 Nonmembers, not to have clearing privileges 870 Permitted to use clearing and collection facilities 821 Reserve requirements of various States 791-792 With small capital, not to be admitted 849 Statements of private bankers accessible to governors and Federal Reserve agents 789 Sterling exchange, should be stabilized 850 Stock ownership by member banks in corporations doing foreign business... 809-810 Strong, Benj., report of Committee on International Exchange 845-848 Subtreasuries, some functions to be taken over by Federal Reserve Banks... 825-826 Surplus of Federal Reserve Banks to accumulate to 100 per cent of capital.. 869 Taxation for war purposes 829-830 Taxation legislation 864-865 Trade acceptances. (See Acceptances.) Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

INDEX TO PART III. 913 Page. Transfer of currency and securities free 865 Treasury certificates of indebtedness 829 Treasury Department to supply currency and gold to member banks 809 Trust companies. (See State banks.) Trustee, national banks acting as 765 United States: Assisting public utility corporations 863 Bond issues 829, 842-843, 844 Bonds, national banks to maintain deposit of 822 Bonds, 2 per cent, to be exchanged for 3 per cent 819, 823 Bonds and Treasury certificates of indebtedness 848 Deposits in member State banks 864 Financing to check expansion of Federal Reserve notes 865-866 Free gold market 868-869 Grain Corporation, loans to 844-845 Gold notes, 1 year, 3 per cent, exchangeable for 2 per cent 823 Gold situation after the war 868-869 Government to bear expense of furnishing notes 788 Liberty bonds, rates on paper secured by 852-853, 863 Liberty bonds, terms for third 852-853 Loans to Allies 843-844 Subtreasuries, some functions of 825-826 Treasurer, to deposit gold with 835 Treasury certificates of indebtedness 829, 851 To finance railroads during war 849 War Finance Corporation 853 War necessities, priorities in capital and bond issues 853 Utility corporations 849, 863 War, business and financial conditions after cessation of 787 War Finance Corporation 853 Assisting public utilities 863 War policies of Federal Reserve Banks after war 867-869 Warrants, purchase of 765 100823°—19 58 O Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis