H.4.1 Factors Affecting Reserve Balances of Depository Institutions

STATEMENT FOE THE PRESS Released for publication St. 6605 Friday morning, May ]0; Federal Reserve Board not earlier. May 29, 1930 • COIIDITIOIT OF FEDERAL RESERVE BiNKS Beginning with this week the text accompanying the weekly condition statement of the Federal reserve "banks will show the amount of reserve "bank credit nnt«tan^ing and certain other items not included in the condition statement. These items, of which monetary gold stock and money in circulation are the most significant, are explained in the attached statement. Changes in these items have a direct bearing on the demand for credit at the reserve banks and their publication will help in the interpretation of changes in the amount of reserve bank credit outstanding. The daily average volume of Federal reserve bank credit outstanding during the week ending May 28 as reported by the Federal reserve banks was $965,000,000, a decrease of $3,000,000 compared with th epreceding week and of $300,000,000 compared with the corresponding week of I929. On May 28 total reserve bank credit outstanding amounted to $976,000,000, an increase of $23,000,000 for the week. This corresponds with an increase of $53,000,000 in money in circulation and a decrease of $6,000,000 in Treasury currency less decreases of $27,000,000 in member bank reserve "balances and of $6,000,000 in unexpende dcapital funds, nonmember deposits, etc., and an increase of $2,000,000 in monetary gold stock. The principal changes in holdings of discounted bills for the week were increases of $24,000,000 at the Federal Reserve Bank of New York, and $3,000,000 each at Cleveland, Atlanta and San Francisco. The System's holdings of bills bought in open market declined $11,000,000 and of Treasury certificates and "bills $47,000,000 while holdings of U. S. bonds increased $5,000,000 and of Treasury notes $43,000,000. Changes in the amount of reserve bank credit outstanding and in related items during the week and the year ending May 28, I930 were as follows: Increase or decrease since May 28, May 21, May 29, 19,30 1930 1929 (In millions of dollars) Bills discounted 247 + 37 - 74l Bills bought 176 - 11 + 58 United States securities 530 + 1 + 385 Other reserve bank credit 24 - 4 - 13 TOTAL RESERVE BAM CREDIT + 23 - 311 Monetary gold stock + 2 + 216 Freqsuiry currently adjusted. - 6 - 28 Money in circulation 4,491 + 53 - 203 Member bank reserve balances 2,347 - 27 + 61 Unexpended capital funds, nonmel,a iDer deposits,etc. 421 — 6 + 20 w. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Federal Reserve Board May 29, 1930. HEW ITEMS IN TEXT ACCOMPANYING- WEEKLY INDERAL RESERVE BANK STATE!ST Reserve Bank Credit. Reserve bank credit outstanding comprises, in addition to the total "bill and security holdings of the Federal reserve "banks, credit given member banks for transit items in advance of their actual collection and funds deposited in foreign banks. Monetary gold^st^ock. Monetary gold stock includes all gold coin in circulation and gold coin and bullion held by the United States Treasury and the Federal reserve banks, except gold earmarked for foreign account. Changes in monetary gold stock, which arise through imports and exports, through earmarking or releases from earmark, and through domestic production (in excess of industrial consumption), have an inverse effect on reserve bank credit, i.e., increases in the gold stock diminish the demand for reserve bank credit, and decreases in the gold stock increase the demand for such credit. Treasury currency - adjusted. Treasury currency-adjusted includes all the currency in the United States, except gold coin and Federal reserve notes, less gold and other cash held by the Treasury and deposits of the Treasury with tne Federal reserve banks. This item represents the net amount of currency outstanding that is based primarily on Treasury credit, and cnanges in this item have the same effect on the demand for reserve bank credit as changes in the stock of monetary gold. Money in circulation. Money in circulation includes all kinds of United . States money outside of the Treasury and the Federal reserve banks, and cnanges in tnis item, rather than in Federal reserve notes alone, reflect changes ih t&e demand for currency by the public. Changes in the demand ±or currency for circulation purposes are thp principal Cause of seasonal changes in the volume of reserve bank credit outstanding. ank reserve balances. Member bank reserve balances comprise the entire legal reserves of member banks, and average changes in these balances, which are subject to substantial day-to-day fluctuations, reflect changes in member bank deposits against which they are held. Member bank reserve balances is the item in the Federal reserve bank statement that is directly influenced by changes in the volume of member bank credit. Unexpended capital funds, nonmember deposits, etc. This heading combines a number of items which do not change greatly from week to week. Changes in nonmember deposits with the reserve banks have the same effect on the ue,nan& for reserve bank credit as changes in member bank balances. Changes in unexpended capital funds also have the same effect. This item measures tne extent to wnich the paying in of caoital to the reserve banks and their subsequent earnings have taken funds out of the market, and comprises capital, surplus, and undistributed earnings less amounts returned to the market principally through the purchase of bank premises. Some of the above items are the principal components of "all other resources" and all other liabilities0 in the weekly statement and accordingly the amount of unexpended capital funds, etc., is arrived at by subtracting from capital," "surplus,11 and "all other liabilities" the items "bank premises" *3nd "all other resources. " (St. 6600) Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

- 2 - For a somewhat more detailed explanation of the above items and their relationship to reserve banlc credi treference may be had to an article on page 432 of the Federal Reserve Bulletin for July 1929 - CHANGES IN CCGTDITI01T STATEMENT Federal reserve notes. The .amount of Federal reserve notes held at Federal reserve banks other than the issuing bank is shown separately; heretofore such notes have been included in "Uncollected items." The object of this change is to make it possible to determine from the weekly statement the amount of Federal reserve notes outside of the Federal reserve banks, and also the net float carried by the reserve banks which arises principally from giving credit for checks and other cash items, in accordance with published time schedules, in advance of actual collection. The amount of Federal reserve notes received from the Comptroller of the Currency and of notes held by the Federal reserve agents have; been omitted from the Federal reserve note statement and the remaining items have been rearranged with a view to bringing out more clearly the difference between Federal reserve notes issued to the reserve banks, against which 100 per cen tcollateral of gold or eligible paper mast be pledged ziti the Feaeral reserve"agents, and notes in circulation against whic1" a reserve of 4o per cent in old is u requirpd. Gold Held as collateral forFederal reserve notes is also counted as a part of th erequired reserve against notes in circulation. St. boGOa Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Released, for publication Friday morning, May 30,1930; no tearlier. St. 66o5a RESOURCES MD LIABILITIES OF THE TWELVE FEDERAL RESERVE BMKS COMBINED (In thousands of dollars) May 28. 1930 May a. 1930 May 29.1929 R E S O U R C ES Gold with Federal reserve agents . . . .. 1,536,714 1,621,714 1,315,181 Gold redemption fund with U.S.Treasury . . 37,357 39,483 66,969 Gold held exclusively against F.R.notes 1,534,571 1,661,197 1,382,150 Gold settlement fund with F. R. Board . . 635,513 614,457 663,795 Gold and gold certificates held by "banks . 787,226 800,802 777,836 Total gold reserves . . . . .. 3,057,310 3,076,456 2,823,781 Reserves other than gold 163,519 171,595 146,177 Total reserves . . . .. 3,220,82Q 3,24s,05i 2,969,958 Eon-reserve cash 67,210 69,096 82,473 Bills discounted: Sec. by U. S. Government obligations . . 101,743 76,379 536,177 Other bills discounted 145,303 133,620 452,017 Total bills discounted . . . 247,046 209,999 988,194 Bills bought in open market 175,560 186,884 117,919 U. S. Government securities: Bonds 46,936 41,776 50,384 Treasury notes 237,966 194,687 84,965 Certificates and bills . 244,868 291,857 9,223 Total U.S. Government securities . . 529,770 528,320 144,572 Other securities 6,4oo 6,46o 7,817 Total bills and securities . . .. 958,776 931,603 1,258,502 Due from foreign banks 709 710 727 Uncollected items 564,916 (610,080 639,044 F. R. notes of other banks 19,054 L20,958 lb,884 Bank premises 58,671 58,646 53,761 All other resources 12,194 12,204 8,543 TOTAL RESOURCES 4,902,359 4,951,34s 5,034,892 L I A B I LI T I ES 2*. E. notes in actual circulation . . .. 1,465,867 1,452,663 1,553,685 Deposi ts; Member bank - reserve account 22,,334466,,779988 2,374,166 2,285,870 49,771 37,088 15,366 Foreign bank 5,387 5,497 8,085 Other deposits 18,893 22,160 21,873 Total deposits 2,420,849 2,438,911 2,331,194 Deferred availability items. 548,376 588,896 611,242 Capital paid in 170,515 174,240 156,446 Surplus 276,936 276,936 254,39s All other liabilities 19,816 19,702 27,927 TOTAL LIABILITIES . . . 4,902,359 4,951,34s 5,034,892 Ratio of total reserves to deposit and F. R. note; liabilities combined . . . 8822..99%% 83-5% 74.5% Contingent liability on bills purchased for foreign correspondents 446611,,885533 461,131 338855,,775544 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

RESOURCES AMD LIABILITIES OF THE FEDERAL RESERVE BASKS ON MAY 23, 1930 St. 6605b R E S O U R C ES (In thousands of dollars) Total Boston New York Phila. CIeve. Rich. Atlanta Chicago St.Louis Minn. ICans.Cy. Dallas San.Fran. Gold with Federal Reserve Agents 1,596,714 164,917 258,594 l4o,000 185,550 73,000 109,000 249,000 69,245 53,845 75,000 28,800 189,763 Gold redemption fund with U.S.Treasury 37,857 1,156 15,006 2,693 2,205 1,333 2,378 1,594 1,817 903 1,592 899 6,281 Gold held exclusively against F. R. notes 1,634,571 166,073 273,600 142,693 187,755 74,333 111,378 250,594 71,062 54,748 76,592 29,699 196,044 Gold settlement fund with F.R.Board 635.513 31,175 214,517 4o,i85 79,302 15,197 12,641 116,450 23,564 15,305 28,250 15,671 38,256 Gold and gold certif. held by "banks 787,226 35,575 477,101 30,285 54,317 9,067 6,080 115,420 8,241 4,686 9,799 9,207 27,448 Total gold reserves 3,057,310 232,823 965,218 213,163 321,374 98,597 130,099 482,464 107,867 74,739 li4,64i 54,577 261,748 Reserves other than gold 163,519 12,076 53,779 6,988 11,085 7,039 l4,4oi 15,634 •12,214 4,194 8,468 7,056 10,585 Total reserves 3,220,829 244,899 1,018,997 220,151 332,459 105,636 144,500 498,098 120,081 78,933 123,109 61,633 272,333 Nonreserve cash 67,210 7,289 16,52s 3,483 3,726 3,815 5,080 9,211 4,699 1,973 1,976 4,297 5,133 Bills discounted: Secured "by U.S.Govt, obligations 101,743 8,143 37,262 15,586 13,907 2,770 1,838 8,036 5,227 576 2,729 1,009 4,66o Other bills discounted 145,303 11,569 15,565 15,910 7,624 13,751 26,876 9,329 14,031 2,985 13,405 7,537 6,671 Total bills discounted 247,046 19,712 52,827 31,496 21,531 16,521 23,714 17,365 19,258 3,561 16,134 8,596 11,331 Bills bought in open market 175,560 16,858 47,325 4,093 11,132 7,572 13,291 19,354 7,351 6,648 6,261 5,807 29,868 U. S. Government securities: Bonds 46,936 i,6i4 4,357 1,311 1,096 1,422 415 a,io4 759 4,979 778 8,446 655 Treasury notes 237,966 16,624 84,539 20,444 26,695 4,814 5,130 21,243 12,580 9,707 6,673 8,550 20,967 Certificates and bills 244,868 22,085 90,152 24,370 22,205 6 >4 3,485 28,357 5,929 9,293 8,874 8,64i 15,073 Total U.S.Govt, securities 529,770 40,323 179,048 46,125 49,996 12,64O 9,030 70,704 19,268 23,979 16,325 25,637 36,695 Other securities 6,4oo 1,000 4,4oo 1,000 mm — — — — Total bills and securities 958,776 77,893 283,600 82,714 82,659 36,733 51,035 107,423 45,877 ,34,188 38,720 4o,o4o 77,894 Due from foreign banks ^ 709 „ 53 232 69 71 30 26 95 26 16 21 21 49 Uncollected items 564,916 bO,286 154,873 50,867 57,657 40,955 15,170 74,869 24,859 10,127 29,325 18,386 27,542 F.R. Notes of other banks 19,054 237 5,610 391 906 1,770 1,295 2,372 1,060 1,276 1,570 548 2,019 Bank premises 58,671 3,580 15,664 1,787 7,059 3,204 2,658 8,295 3,811 2,018 3,972 1,876 4,747 All other resources 12,194 45 4,299 204 1,185 6i4 3,455 429 301 443 291 4i6 512 TOTAL RESOURCES 4,902,359 394,282 1,499,803 359,566 485,722 192,757 223,219 700,792 200,714 128,974 198,984 127,217 390,229 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

RESOURCES AND" LI ABILITIE SOF 'THE "fEmR:AL RESERVE-BA ^OSN MAY ' 2S ,1930 ' L I A B I L I T I ES (In thousands of dollars) st. 6605c Total Boston New York Phila. Cleve. Rich. Atlanta Chicago St.Louis Minn. Kans.Cy. Dallas San Fran. F.R.notes in actual circulation 1,465,867 155,748 184,330 137,367 187,083 66,552 123,7% 226,056 74,912 55 , 283 71,139 30,460 153,191 Deposits: Member bank - reserve account 2,346,798 138,690 990,889 127,145 191,523 61,170 61,038 333,579 78,845 50,664 84,990 61,232 167,033 Government 49,771 5,541 15,225 3,039 2,269 4,681 3,202 6,385 1,492 2,O4O 1,840 1,625 2,432 Foreign bank 5,387 1,787 521 225 193 1)1 161 161 370 Other deposits 18,893 9,050 93 i.S$ 95 58 1 17? 55. 28 7,005 Total d. coits 2,420,349 144,684 1,016,951 130,798 195,669 66,171 64,491 341,257 80,893 53,003 87,046 63,046 176,840 Deferred avail abi'.; j. ,y u.terns 548,376 59:920 145.6I4 46,988 56,292 40,688 16,530 70,372 27,180 9,547 26,924 19,619 28,702 Capital paid in 170,515 11,822 56,202 16,745 15,899 5,874 5,374 20,208 5,285 3,098 4,330 4,352 11,326 Surplus 276,936 21,751 So.001 26,965 29,141 12,496 10,857 40,094 10,877 7,143 9,1-6--2 3,935 19,514 111 other'liabilities 19,816 357 6.705 803 1,638 976 2,221 2,805 l,5o7 900 383 805 . 656 TOTAL LI ABILITIES 4,902,359 394,282 1,499>303 359, 66 485,722 192,757 223,219 700,792 200,714 128,974 198,984 127,217 390,229 Reserve ratio (per cent) 82.9 81.5 84.8 82.1 S6.9 79.6 76.8 87.8 77.1 72.9 77.8 65.9 82.5 Contingent liability on bills purchased for foreign correspondents 461,853 33,325 159,677 43,683 45,034 18,914 16,212 6O,345 16,212 IO,358 13,510 13,510 31,073 FEDERAL RESERVE NOTE STATEMENT Federal reserve notes: Issued to F.R.bank by F-?, Agont 1,786,049 184,146 241,693 156,930 215,079 88,659 150,581 260,724 8q,4n 62,163 81,571 4o,2o4 214,888 Held by Federal rescx*vo banlc 320,182 28,398 57,363 19,563 27,996 22,107 26,835 34,668 14,499 6,880 10,432 9.744 61.697 In actual circulation 1,465,867 155,748 184,330 137,367 187,083 66,552 123,746 226,056 74,912 55,283 71,139 30,460 153,191 Collateral held by agent as security for notes issued to bank: Gold and gold certificates 402,008 35,300 229,96s 39,900 15,550 5,000 6,000 9,145 11,845 14,300 35,000 Gold fund - I B. Board 1,194,706 129,617 22.626 100.100 170,000 68,000 103,000 249,000 60,100 42,ooo 75,000 14/500 154,'763 Eligible paper 412,148 36,492 94,928 32,^76 32,068 £4,010 41,701 36,541 25,947 10,099 22,279 14,290 41,017 Total collateral 2,008,862 201,409 353,522 172,776 217„6l8 97,010 150,701 285,541 95,192 63,944 97,279 43,090 230,780 MATURITY DISTRIBUTION OF BILLS AND SHORT TERM SECURITIES 91 days to Total Vithin 15 days l6 to 30 days 31 to 60 days 6l to 90 days Over 6 month 6 months Bills discounted 247,046 152,044 20,736 33,329 18,431 . 21,312 1,194 Bills bought in open market 175,560 103,869 29,06c 32, §73 9,177 872 Certificates and bills 244,868 13,47% 4o,ooo 63,213 86,176 42,005 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis