frb_041930

FEDERAL RESERVEBULLETIN

APRIL, 1930

ISSUED BY THE

FEDERAL RESERVE BOARDAT WASHINGTON

Lower Money Rates and the Banking SituationCondition of All Banks in the United StatesBranch, Chain, and Group BankingGold Holdings of Principal CountriesFinal Act of The Hague Conference

UNITED STATESGOVERNMEiNT PRINTING OFFICE

WASHINGTON: 1930

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

FEDERAL RESERVE BOARD

Ex officio members:A. W. MELLON,

Secretary of the Treasury, Chairman.

J. W. POLE,Comptroller of the Currency.

ROY A. YOUNG, Governor.EDMUND PLATT, Vice Governor.ADOLPH C. MILLER.CHARLES S. HAMLIN.GEORGE R. JAMES.EDWARD H. CUNNINGHAM.

WALTER L. EDDY, Secretary.E. M. MCCLELLAND, Assistant Secretary.J. C. NOELL, Assistant Secretary.W. M. IMLAY, Fiscal Agent.

Chief, Division of Examination, and Chief FederalReserve Examiner.

WALTER WYATT, General Counsel.E. A. GOLDENWEISER, Director, Division of Research

and Statistics.CARL E. PARRY, Assistant Director, Division of Research

and Statistics.E. L. SMEAD, Chief, Division of Bank Operations.

District No.District No.District No.District No.District No.District No.District No.District No.District No.District No.District No.District No.

II

FEDERAL ADVISORY COUNCIL

1 (BOSTON) HERBERT K. HALLETT.2 (NEW YORK) WM. C. POTTER.3 (PHILADELPHIA) L. L. RUE.4 (CLEVELAND) HARRIS CREECH.5 (RICHMOND) JOHN POOLE.6 (ATLANTA) J. P. BUTLER, Jr.7 (CHICAGO) FRANK O. WETMORE, President.8 (ST. LOUIS) W. W. SMITH.9 (MINNEAPOLIS) GEO. H. PRINCE.10 (KANSAS CITY) W. S. MCLUCAS.11 (DALLAS). B. A. MCKINNEY, Vice President.12 (SAN FRANCISCO) ___ F. L. LIPMAN.

WALTER LICHTENSTEIN, Secretary


OFFICERS OF FEDERAL RESERVE BANKS

Federal Reserve Bank of

BostonNew York..

Chairman

Frederic IT. CurtissJ. H. Case . - . . .

Governor Deputy governor

Philadelphia..ClevelandRichmondAtlanta

Chicago.

R. L. Austin

George DeCamp

Win. W. Iloxton

Oscar Newton..

Win. A. Ileath-

St. Louis Rolla Wells

Minneapolis

Kansas City. . .

Dallas

San Francisco .

John R, Mitchell

M. L. McClure

C. C. WalshIsaac B. Newton..

W. P. G. Harding. __ i W. W. PaddockGeo. L. Harrison \ L. F. Sailer1

E. R. Kenzel _A. W. GilbartL. R. RoundsJ. E. CraneWalter S. Logan

Cashier

Geo. W. Norris Wm. IT. Hutt

E. R. Fancher

George J. Seay

Eugene R. Black

J. B. McDougal

M. J. FlemingFrank J. Zurlinden..C. A. PepleR. II. BfoaddusHugh FosterCreed TaylorC. R. McKayJohnH. Blair

Wm. McC. Martin I O. M. Attebery.

W. B. Geery

W. J. Bailey

Lynn P. Talley.

Jno. U. Calkins.

narry YaegerH. I. ZiemerC. A. Worthington.J. W. Helm.. . .R. R. GilbertR. B. ColemanWm. A. Day. . . .Ira Clerk

W. Willett.J. W. Jones.iRay M. Gidney.iW. B. Matteson.iC. IT. Coe.iJ. W. Jones.ij ; M. Rice.1Allan SprouUC. A. Mcllhennv.W. G. McCreedy.2IT. F. Strater.Geo. H. Keesee.John S. AValden, jr.2M. W. Bell.

W. C. Bach in an. 2K. C. ChildsJJ. H. Dillard.2D. A. Jones.*O. J. Netterstrom.2A. II. Haill.2S. F. Gilmore.2F. N. Hall.2G. 0. Ilollocher.*C. A. Schacht.2Gray Warren.Frank C. Dunlop.2J. W. Helm.

Fred Harris.W. 0. Ford.iWm. M. Hale.

1 Assistant deputy governor. 2

Controller.

MANAGING DIRECTORS OF BRANCHES OF FEDERAL RESERVE BANKS


New York:Buffalo branch

Cleveland:Cincinnati branchPittsburgh branch

Richmond:Baltimore branch .Charlotte branch _.

Atlanta:New Orleans branchJacksonville branchBirmingham branchNashville branch

Chicago:Detroit branch

St. Louis:Louisville branch _ _Memphis branchLittle Rock branch.

Managing director

R. M. O'Hara.C. F. McCombs.J. C. Kevin.A. H. Dudlev.Hugh Leach.

Marcus Walker.W. S. McLarin, jr.A. E. Walker.J . B . Fort, jr.W. R. Cation.W. P. Kincheloe.W. II. Glasgow.A. F. Bailey.


Minneapolis:Helena branch

Kansas City:Omaha branchDenver branchOklahoma City branch

Dallas:El Paso branchHouston branchSan Antonio branch

San Francisco:Los Angeles branch _Portland branch. _..Salt Lake City branchSeattle branchSpokane branch _

Managing director

R. E. Towle.

L. IT. Earhart.J. E. Olson.C. E. Daniel.J. L. Hermann.W. D. Gentry.M. Crump. |W. N. Ambrose.R . B , West.W. L. Partner.C. R. Shaw.D. L. Davis.

SUBSCRIPTION PRICE OF BULLETIN

The FEDERAL RESERVE BULLETIN is the board's medium of communicationwith member banks of the Federal reserve system and is the only official organor periodical publication of the board. The BULLETIN will be sent to all memberbanks without charge. To others the subscription price, which covers the cost ofpaper and printing, is $2. Single copies will be sold at 20 cents. Outside of theUnited States, Canada, Mexico, and the insular possessions, $2.60; single copies,25 cents.

in


TABLE OF CONTENTS

PageReview of the monthLower money rates and the banking situation 139

Decline in money ratesRates charged to customersCauses of rate declineDecreased demandfor reserve-bank creditDecline in member-bank discountsMember-bank credit.

Branch, chain, and group banking 144-157, 258-266Gold holdings of principal countries at the end of 1929 170Final act of the Hague Conference 172-249Condition of all banks in the United States on December 31, 1929 143, 270-273

National summary of business conditions 158

Financial, industrial, and commercial statistics:Reserve bank credit and factors in changes 159, 160Analysis of changes in monetary gold stock 160Gold movements to and from United States 160Member bank borrowings at Federal reserve banks 161Discount rates and money rates 161, 162Member bank credit 163Bankers' acceptances and commercial paper outstanding 163Brokers' loans 163Security prices, security issues, and building contracts 164Production, employment, car loadings, and commodity prices 165Industrial production and building 166Factory employment and pay rolls 167

Banking and business conditions in Federal reserve districts:Reserves, deposits, note circulation, and reserve percentages of Federal reserve banks 168Discounts of Federal reserve banks 168Bank debits 168Building 169Department storesIndexes of sales and stocks 169Commercial failures 169Bank suspensions 169

Financial statistics for foreign countries:Gold holdings of central banks and Governments 250Gold exports and imports - 250Condition of central banks 251, 252Condition of commercial banks 253Discount rates of central banks 254Money rates 254Foreign exchange rates 255Price movements 256, 257

Law department:Digest of State laws relating to branch banking 258-266

Changes in national and State bank membership 267, 268Fiduciary powers granted to national banks 268Resources and liabilities of Federal reserve banks in detail and Federal reserve note statement 269

IV


FEDERAL RESERVE BULLETINVOL. 16 APRIL, 1930 No. 4

REVIEW OF THE MONTHConditions in the money market eased fur-

ther in March, both in the United States andabroad, continuing the move-

Decline in money m e n t t h f t t b e g a n lflfl t O c tober.At the end of March the decline

in open-market rates from the highest levelsof last year had amounted to more than 2 percent in New York, London, and Berlin, andthere was also a marked decline in averagerates charged on loans made directly to regularcustomers by banks in the leading cities of allsections of this country. New York rates onloans of the most liquid types, including callloans on securities and credit extended onbankers' acceptances, reached in March thelowest levels since 1924, with both acceptancerates and renewal rates on call money at onetime below 3 per cent. The official discountrate at the Federal Reserve Bank of New Yorkwas reduced on March 14 from 4 to 3}i per cent,and in the following week rates at the Cleve-land, Philadelphia, and San Francisco reservebanks were reduced from 4% to 4 per cent.Discount rates of central banks in importantforeign countries also were reduced in March,the Bank of England rate being reduced from4% to 4 and later to 3% per cent, and the rate atthe German Reichsbank from 6 to 5}i and laterto 5 per cent.

Reports covering rates charged customers oncommercial and security loans by banks in Fed-

eral reserve bank and branchc i t i e s

indicate that the averageof these rates declined further

in March to the lowest levels in more than ayear. This is brought out by the chart, whichcovers the period since January, 1926, withseparate curves for banks in New York City,banks in other northern and eastern cities,and banks in southern and western cities.Customers' rates advanced continuously from

early in 1928 until the third quarter of 1929?but began to decline in November. The chartalso brings out the fact that this decline, likethe preceding advance, began in New YorkCity and other cities of the North and East,and was followed somewhat later by declinesof rates in the southern and western group ofcities; since last December the rates chargedcustomers have been declining in leading citiesof all sections of the country. From last au-tumn to the middle of March average rates in

RATES CHARGED CUSTOMERS

1926 1927 1928 1929 1930Weighted averages of prevailing rates on commercial loans and security

loans. (For explanation see p. 162)

New York City declined by more than 1 percent to a level under 5% per cent with somecommercial loans made at 4% per cent, whilein the other cities of the North and East therates declined by three-quarters of 1 per centto a level under 5K per cent, and in the groupof southern and western cities by about one-third of 1 per cent to a level under 6 per cent.The sequence of these movements has been inaccord with previous experience. The mostsensitive rates are the rates in the open market,especially the rates on call loans, bankers' ac-ceptances, and commercial paper. At the timeof a turn in the course of rates these rates arethe first to register either an advance or a de-

139


140 FEDERAL RESERVE BULLETIN APRIL, 1930

cline. Continued ease in the open marketspreads in course of time over the other andless sensitive markets, affecting at first therates charged by banks in the principal finan-cial centers to borrowers who are in positionto choose between banks from which to bor-row or obtain funds in the open market, andlater spreads to other borrowers and othercenters, first in the North and East and laterin the South and West.

Easier conditions in the money markets ofthe United States in recent months have been

caused in part by Federal re-declines Fa e s e r v e policy as expressed in rate

reductions and in open-marketpurchases of securities and in part by a de-crease in the demand for funds since the

BILLIONS OF DOLLARS

10 MEMBER BANKS IN LEADING CITIES

I ! ! I"ALL OTHER" LOANS

OF DOLLARS

10

Jan. Feb. Mar. Apr. May June July Aug. 5pt. Ccf. Nov Dec.

October-November break in the stock market.There has been a large decrease since thattime in the demand for loans to finance trans-actions in securities, and the reduced volumeof business activity has resulted also in a de-crease in the demand for commercial loans.So-called "all other" loans of reporting mem-ber ranks, changes in which are due chiefly tochanges in the commercial demand for credit,began to decline in November and continuedto decline rapidly for more than four monthsnot only through December and January, whenthe seasonal trend is downward, but also inFebruary and March, when it is usual for thisclass of loans to increase. The chart shows the

course of these loans since 1927 and brings outthe fact that the decline in their volume inFebruary and March carried them below thelevels of 1929 and 1928, and only slightly abovethe level of 1927.

Decreased demand for commercial credit atthe member banks has been accompanied by^ , , a continuous reduction in theDecreased de- _ _ . _ _.mand for re- demand lor reserve-bank credit.credit b a n k T h e P r i n c i P a l f a c t o r i n t h i s

reduction has been the decreasein the demand for currency. Currency beganto return from circulation in large volume thisyear, as in other years, immediately after thecessation of the Christmas holiday demand, butthis year the return flow did not stop in Janu-ary, as it usually does. In February and Marcha certain amount of money usually flows outinto circulation again, but this year, in conse-quence of inactive trade and a smaller thanusual increase in pay-roll requirements of in-dustry, the volume of money in circulationcontinued to decline, by about $50,000,000, andwas at the end of March less than at any othertime since 1922. A chart showing the volumeof money in circulation for several }^ ears past isinserted at this point.

MILLIONS OF DOLLARS MILLIONS OF DOLLARS5 2 0 0 1

~^~ MONEY IN CIRCULATION T ! i 5 2

51005100 1 1 :

5000

4900

4800

1*700

4600

4500

4400 LJan. Feb. Mar Apr May June July Aug". Sept OCT. NOV. Dec.

Weekly averages of daily figures

Another factor in the decrease in the demandfor reserve-bank credit and consequently in theeasing tendency in the money market, has been


APRIL, 1930 FEDERAL RESERVE BULLETIN 141

an inflow of gold from abroad. The movementof gold, which was outward in November andDecember and small in January, was inwardin February and March, and there was an in-crease of $130,000,000 in the country's goldstock during the two months.

The return flow of currency from circulationand the imports of gold, together with some

open-market purchases by theDecline in mem-

reserve banks, resulted in a re-b e r b a n k d i s - J J U I . I I .counts auction oi member bank bor-

rowings at the reserve banks tothe lowest level since 1917, with the exceptionof a few weeks in 1924 and 1925. Through-out the month of March member banks in NewYork City were practically out of debt at thereserve bank, for the only period of any con-siderable length since 1924, and the memberbanks in Chicago and several other importantcities were also out of debt. For a few daysat the middle of the month the credit situationwas exceptionally easy, especially at NewYork, because of a temporary accession of fundsto the market that accompanied Treasuryfinancing. A slightly firmer situation de-veloped thereafter, but the indebtedness ofmember banks at the reserve banks on March 26continued to be low throughout the countrybelow $40,000,000 in the New York and Phila-delphia reserve districts, below $30,000,000 inthe Cleveland and Chicago districts, below$20,000,000 at Boston, Richmond, Atlanta,St. Louis, and Kansas City districts, $8,400,000in the San Francisco district, $5,600,000 in theDallas district, and $2,200,000 in the Minne-apolis district. A chart showing memberbank indebtedness by districts appears at theend of this review.

As has already been mentioned, the com-mercial demand for credit at member banks, as

well as the demand for reserve-b a n k credi t> h a s b e e n decreas-ing since last autumn. The

total volume of loans and investments of mem-ber banks in leading cities declined almostcontinuously from the peak on October 30 tothe low point of February 26. Beginning withthe last week in February, however, the total

volume of credit of these banks began to in-crease rapidly and at the end of March wasabout $560,000,000 larger than a month earlier.This increase consisted in part of a growth ofinvestments, particularly at the time of theMarch 15 Treasury financing. The principalgrowth of member bank credit, however, wasin loans on securities, which increased by$540,000,000 between the end of February andthe end of March. This growth in securityloans represented an increase in loans to brokersand dealers by the member banks. Brokers'loans by reporting member banks in New YorkCity for their own account and for out-of-townbanks were at their low point on January 22,when their total was $1,688,000,000. Betweenthat date and April 2, these loans to brokers bydomestic banks increased by approximate!}^$1,000,000,000. During the same period brok-ers7 loans for account of corporations and indi-viduals, as well as foreign banks, declined by$340,000,000, so that the total increase inbrokers' loans was $625,000,000. The con-siderable growth in brokers' loans during thepast two or three months, which has accompa-nied an advance in security prices, has thereforebeen financed entirely by the banks, and par-ticularly by the New York banks for their ownaccount. Brokers' loans by the New Yorkbanks on April 2 were, in fact, at the highestfigure on record, with the exception of the fewdays immediately following upon the stock-market break last October. Nonbanking lend-ers, on the other hand, have continuously with-drawn funds from the market since the lastweek in October, and the volume of theirbrokers' loans placed through New York report-ing banks is now lower than at any other timein nearly two years.

The banking system, therefore, enteredupon the second quarter of 1930 with a volumeof member-bank credit that had shown anupward movement during the last month,but was still at approximately the same levelas a year earlier. As compared with a yearago, member-bank loans on securities showeda considerable increase, while all other loanswere much lower and investments also showed



a substantial reduction. The volume of re-serve-bank credit early in April was at thelowest point since the middle of 1927. Thesystem's holdings of acceptances were some-what higher than a year ago, and its holdings

of Government securities were more than$300,000,000 higher. Discounts for memberbanks, on the other hand, were about $800,000,-000 lower than last year, and with one exceptionwere at the lowest point since before the war.

MILLIONS OF DOLLARSFEDERAL RESERVE BANK DISCOUNTS-BY DISTRICTS

-.(..Weekly report date figures ) MILLIONS OF DOLLARS300

1326 1927 1928 1929 1930 1926 1927 1928 1929 1930



Death of Governor Harding

Governor W. P. G. Harding, of the FederalReserve Bank of Boston, died on April 7, 1930.Governor Harding was a member of the FederalReserve Board from its organization in 1914 to1922, and was its governor from 1916 to 1922.Since that time he has been governor of theFederal Reserve Bank of Boston.

Changes in Discount Rates and Bill Rates

The discount rate on all classes and maturi-ties of paper was reduced from 4 to 3K per centat the Federal Reserve Bank of New York,effective March 14; and from 4% to 4 per centat the Federal Reserve Bank of Cleveland,effective March 15; at the Federal ReserveBank of Philadelphia, effective March 20; andat the Federal Reserve Bank of San Francisco,effective March 21.

At the Federal Reserve Bank of New Yorkbuying rates on bills of all maturitiessuccessively reduced during FebruaryMarch as shown in the following table:

wereand

Date effective

In effect Feb 1Feb. 11Feb. 24Mar. 5Mar. 6. . . .Mar. 11Mar. 14Mar. 17. . . .Mar. 19Mar. 20.

; 1 to 15days

m

3563V&3H

3

i10 to 45 ' 40 to 120

(lays ' days

3J6: 4

1 3%

3H! 3H3^i 3ii

3

121 to 180days

4H

43%

3%

1 Rate of 3J4 on maturities of 91-120 days.

Changes in Foreign Central Bank Discount Rates

The following changes have been made sincethe first of February in the discount rates ofcentral banks in foreign countries:

February 5.German Reichsbank, from 6J4 to 6 percent.

February 6.Bank of England, from 5 to 4% per cent.February 10.Bank of Java, from 5>72 to 5 per cent.February 11.Austrian National Bank, from 7 to

6% per cent.February 13.National Bank of Hungary, from 7 to

6}^ per cent.March 3.Bank of Italy, from 7 to 6H Per cent.March 6.Bank of England, from 4} to 4 per cent.March 7.Danish National Bank, from 5 to 4} per

cent; Bank of Netherlands, from 4 to 3K per cent;Bank of Sweden, from 4.]^ to 4 per cent.

March 8.German Reichsbank, from 6 to 5}^ percent; Bank of Danzig, from 6 to 5}'2 per cent.

March 10.Bank of Java, from 5 to 4}^ per cent.10302530 2

March 14.Bank of Poland, from 8 to 7 per cent.March 20.Bank of England, from 4 to 3 ^ per cent.March 21.Bank of Norway, from 5 to 4J4 per cent.March 22.Austrian National Bank, from 6% to 6

per cent.March 25.Netherlands Bank, from Qfa to 3

cent; German Reichsbank, from 5% to 5 per cent.March 29.National Bank of Hungary, from 6

6 per cent.April 3.Imperial Bank of India, from 7 to 6 per

cent; Bank of Sweden, from 4 to 3J4 per cent; NationalBank of Switzerland, from 3}i to 3 per cent.

per

to

Condition of All Banks in the United States on Decem-ber 31, 1929

Total loans and investments of all banks inthe United Statesincluding national banks,State banks, trust companies, mutual and stocksavings banks, and private banks under Statesupervisionincreased by $151,000,000, or 0.3per cent, during the year ending December 31,1929, according to figures that have recentlybecome available. This increase brought thetotal loans and investments of all banks to thelevel of $58,417,000,000. The growth of $151,-000,000 reflected an increase of $250,000,000for member banks and a decrease of $99,000,000for nonmember banks.

The entire increase in bank credit, bothinside and outside the Federal reserve system,occurred in loans, as shown by the accompany-ing table. The banks' investment holdings

ALL BANKS IN THE UNITED STATES[Figures for end of December. Amounts in millions of dollars]

Loans and investments:All banksMember banks _. _Nonmember banks

Loans:All banksMember banksNonmember banks

Investments:All banksMember banksNonmember banks

1929

58, 41735, 93422,483

41, 89826,15015, 748

16, 5199, 7846, 735

1928

58, 26635, 68422, 582

40, 76325,15515, 607

17, 50410, 5296,975

Increase c

Amount

151250

- 9 9

1,135995141

- 9 8 5- 7 4 5- 2 4 0

r decrease

Per cent

0.3.7

- . 4

2.84.0.9

- 5 . 6- 7 . 1-3 .4

continued the decline which began in the mid-dle of 1928, and at $985,000,000 at the end ofthe past year were 5.6 per cent smaller than onDecember 31, 1928. Investments of memberbanks decreased 7.1 per cent during the year,and investments of nonmember banks de-creased 3.4 per cent.

More detailed compilations of the principalresources and liabilities of these banks, byFederal reserve districts and by States, aregiven on pages 270-273 of this BULLETIN



BRANCH, CHAIN, AND GROUP BANKING: DECEMBER, 1929Compilations by the board covering branch,

chain, and group banking developments at theend of 1929 are presented in detail for States ingeneral tables on pages 151 to 157 of this issueof the BULLETIN, indicating changes during thelast half of the year, and also, in so far as dataare available, during the period following andpreceding passage of the McFadden Act earlyin 1927. In these tables the number of na-tional, State member, and nonmember banksand banking offices in the several Statesaffiliated in branch, chain, and group systems,and the number of independent unit banks ofthese classes is shown, together with aggregateloans and investments.

Branch-banking developments during thelast half of 1929.On December 31, 1929, 822of the 24,630 banks* of all classes in the countrywere operating 3,547 branch offices, including119 banks operating 1,415 branches which werealso reported as affiliated in chain or groupsystems. Banks operating branches at the endof 1929 included 166 national banks operating1,027 branches; 180 State member banks oper-ating 1,299 branches; and 476 nonmemberbanks operating 1,221 branches. Loans andinvestments of these banks totaled $25,000,-000,000, of which over $20,000,000,000 wasreported from States which permit branchesonly in the city in which the parent bank islocated or territory contiguous thereto, and inwhich accordingly branch banking is carried ononly in local urban or home-city systems.Nearly $11,000,000,000, or more than half ofthis $20,000,000,000, was reported from the 71banks operating 580 branches in the city ofNew York. A majority of these New YorkCity banks were, however, operating only oneor two branch offices each in the city. Approx-imately $4,000,000,000 of loans and invest-ments was reported from banks operatingbranches in the nine States which permit state-wide branch banking. This aggregate includednearly $2,700,000,000 reported for the 53branch systems operating 863 branches inCalifornia, and about $1,300,000,000 from the8 remaining States which permit developmentof branch systems on a state-wide basis, andin which 151 banks (in a total of 1,567 banksof all classes) were operating 399 branch offices.A large majority of these banks, also, as well asthe banks operating branches in California,were operating only one or two branch offices.

The branch-banking area, comprised of 21States and the District of Columbia, in which

1 Based on abstracts of condition reports covering national and State

banks for Dec. 31 or nearest available date, as shown on pp. 270-273.

State banks are permitted under State law andnational banks under Federal law to establishbranch offices has not changed materially inrecent years. Within this area state-widebranch banking, which has developed mostextensively in California, has shown consider-able development also in Maryland, Northand South Carolina, Rhode Island, and VirginiaIn several other States of the branch-bankingareaNew York, Michigan, Ohio, Pennsyl-vania, New Jersey, Massachusettsin whichthe establishment of branches is restricted tothe home city of the parent bank or territorynearly contiguous thereto, a considerable devel-opment of urban or local branch systems hasbeen in evidence for several years past.

Comparison of figures compiled for Junewith those for December, 1929, indicates a con-tinuance of branch-banking developments dur-ing these six months at about the same rate ofincrease as during the past three years. In thishalf year the number of banks operatingbranches increased by 4 and the number ofbranch offices by 107. Only inconsiderableincreases were, however, shown for some of theprincipal branch-banking States, the numberof branches of the California banks increasingonly from 861 in June to 863 in December, andof Michigan banks from 433 to 439. Moreconsiderable increases are reported for NewYork, Ohio, Pennsylvania, and Massachusetts.

Although the number of branch systemsincreased by only 4 during the last half of theyear, 36 banks w h^ich were not operatingbranches in June, were operating branches inDecember. This addition of 36 to the numberof branch systems was offset in large part bya decrease of 25 through merger procedures, adecrease of 6 as a result of suspension of opera-tions of the parent bank, and a decrease of 1by discontinuance of branches.

The increase of 107 in number of branchesalso is a net increase covering 163 branchesestablished during the six months7 period82de novo as branches, and 81 by conversion ofbanks into branchesand the discontinuanceof 56 branches, partly by merger with otherbranches, and in the case of 7 branches followingsuspension of parent banks.

The number of banks operating branches,and the number of their branches on June 30and December 31, 1929, and for February 25,1927, and June 30, 1924, are shown, by States,in Tables 2 and 3.

Branch banking developments since passageof McFadden Act.Branch banking develop-ments since February, 1927, when the McFad-



den Act became effective, have been principallyin the building up of urban branch systems.In the period of approximately two years and10 months from February 25, 1927, to Decem-ber 31, 1929, the number of home-city branchesin the country as a whole increased from 1929to 2,432, or by 503, and the number of brancheslocated outside the home city of the parentbank from 971 to 1,115, or by 144. Duringthis period 120 branch systems were mergedwith other banks, 15 suspended operations, and28 (of which 26 operated only 1 branch and 2operated 2 branches each) discontinued allbranches. These decreases were more thanoffset by 206 banks which initiated branchbanking during the period, giving a net in-crease of 43 in the number of branch systems.

Of the 2,900 branches in operation in Febru-ary, 1927, 224 were discontinued or merged,with other branches during the period, includ-ing 30 discontinued following suspension ofparent banks, and 871 branches were estab-lished511 de novo as branches and 360 byconversion of banks into branches.

In this period, also, the classification ofbranches operated by national and by Statemember banks was materially affected bynationalization of large State-bank systems inCalifornia, either directly or by merger withexisting national banks. These proceduresaccount largely for the increase in the numberof branches of national banks from 390 inFebruary, 1927, to 1,027 in December, 1929,and for the decrease in number of branchesof State member banks from 1,560 to 1,299.In the same period nonmember bank branchesincreased from 950 to 1,221.

Principal branch banking States and cities.At the end of 1929 branches were in operationin 29 States and the District of Columbia1,286 in the 9 States and the District ofColumbia which permit state-wide branchbanking, 2,207 in the 12 States which restrictthe establishment of branches to the home cityof the parent bank or territory nearly con-tiguous thereto, and 54 in 8 States in whichthe further extension of branch banking isprohibited by State law. Two-thirds of the3,547 branches in operation in Decemberwere located in 5 StatesCalifornia, NewYork, Michigan, Ohio, and Pennsylvaniaand in each of 4 other StatesMassachusetts,New Jersey, Louisiana, and Marylandmorethan 100 branches were in operation.

Of the 2,432 home-city branches, 1,659, ormore than two-thirds, were located in 10 cities,the number of such branches in each of thesecities being as follows:

New York 580 ' Cleveland 85Detroit i 309 | Buffalo..._ 73Los Angeles 1 201 j Boston 66Philadelphia 133 , Baltimore 65San Francisco 1 97 ! Cincinnati 1 50

Size of branch systems.At the end of theyear, 18 banks were operating each more than30 branches, including six California systems,one of 287 branches, and 5 of 160, 139, 94, 56,and 31 branches, respectively. Three Detroitbanks were operating 94, 33, and 31 branches,respectively; 7 New York City banks wereoperating each from 33 to 67 branches; 1 Cleve-land bank was operating 57; and 1 Buffalobank 33 branches. These larger branch sys-tems represent in man}^ cases a succession ofmergers of smaller branch systems or of con-version into branches of independent banks.All but 2 of these 18 banks were members ofthe Federal reserve system.

It was still true in December, however, as atearlier dates, that a large majority of the banksoperating branches in the country as a wholewere operating only 1 or 2 branches each. Ofthe 822 banks operating branches, 448, or morethan half, were operating only 1 branch each,150 were operating 2, and 124 were operating3 to 5 branches each, the proportion of smallsystems being not materially different from theproportion shown in February, 1927.

Rural branches.Of the 1,115 brancheslocated outside the home city of the parentbank, 612 were located in places of less than2,500 population; 136 in places of 2,500 to5,000; 86 in places of 5,000 to 10,000; and 281in places of over 10,000. The 281 outsidebranches located in places of over 10,000 popu-lation represented largely branches of state-wide California systems with head offices inLos Angeles and San Francisco operatingbranches in other large cities of the State.The number of branches located in places ofless than 2,500 increased by 40 in the periodfrom June, 1928, to December, 1929.

Method of establishment of branches.More than two-thirds of the branches in opera-tion in February, 1927, were offices which hadbeen established de novo as branches, the re-maining branches representing largely conver-sions of independent banks into branches,although in some instances the method ofestablishment was not ascertained. In theperiod from February, 1927, to December, 1929,the number of de novo branches increased by383from 1,996 to 2,379and the number ofbranches representing conversions of banksincreased by 282from 735 to 1,017, the method

Exclusive of branches whose head offices were located in other cities.



of establishment in the case of 151 offices nothaving been ascertained.

Suspension or failure of branch systems.During the 9-year period 1921-1929, 41 branchsystems operating a total of 80 branches sus-pended operations, with total deposits of$49,000,000. Five of these systems were subse-quently reopened, and later one of these wasagain closed. Of the 41 systems, 29 were oper-ating 1 branch each, six 2 branches each, two 3,two 4, one 5, and one 20 branches. Ten of thesebanks, operating a total of 18 branches, withdeposits of $20,000,000, suspended operationsduring 1929, one of these 10 operating 2 brancheswith deposits of $5,882,000 being later reopened.

Banking offices.Branch-banking develop-ments may involve some reduction in the num-ber of corporately independent banking insti-tutions without involving a correspondingreduction in the number of banking officesserving the public; as, for example, in case abank is acquired by a branch system and con-verted into a branch office, or where a branchoffice is established de novo as a branch in placeof a bank which has closed its doors. In someStates'increase in the number of branches inrecent years has partially offset a decrease inthe number of corporately independent banks,as may be seen from the following table sum-marizing changes in the number of bankingoffices, in and outside the branch-banking area,in the periods before and following passage ofthe McFadden Act early in 1927.BANKING OFFICESINCREASE OR DECREASE () IN

THE NUMBER OF OFFICES IN AND OUTSIDE THEBRANCH-BANKING AREA: 1924-1929

Increase or decrease ()Date and area

United States:1924, June1927, Feb. 25- . .1929, Dec. 31. _ .

Branch bankingarea:

1924, June1927, Feb. 25.._1929, Dec. 3 1 . . .

Outside branchbanking area:

1924, June -1927, Feb. 25 . . -1929, Dec. 3 1 . . .

California:1924, June1927, Feb. 2 5 . . .1929, Dec. 31. __

Michigan:1924, June1927, Feb. 2 5 . . .1929, Dec. 3 1 . . ,

New York:1924, June1927, Feb. 2 5 . . .1929, Dec. 3 1 - - .

Nuinber of

Total

31, 28929, 87328,177

13,00213,11013,134

18, 28716,76315,043

1,2131,3161,300

1,0501,1401,182

1,4821,6691,849

bankingoffices

Banks

28,996126, 97324, 630

10, 770110, 264

9,641

18,226116, 709

14, 989

6751554

437

7181739

743

1,120i 1,152

1,127

Branches

2,2932,9003,547

2,2322,8463,493

615454

538762863

332401439

362517722

Total 11 Banks Branches

) - 1 , 4 1 6 ' - 2 , 0 2 3! - 1 , 696 - 2 , 343

10824

t - 1 , 5 2 4I - 1 , 720

103- 1 6

187180

607647

- 6 2 3

- 1 , 5 1 7- 1 , 720

- 1 2 1- 1 1 7

614647

224101

32- 2 5

155205

i Mar. 23, 1927.

The number of banks of all classes in thecountry as a whole decreased in the period fromJune, 1924, to the end of February, 1927, by2,023. For the 21 States and the District ofColumbia comprising the branch-banking area,the decrease amounted to 506, and in this areathe number of branch offices increased in thesame period by 614, giving a relatively smallincrease in the total of banking offices for thearea, from 13,002 to 13,110. Outside this areathe decrease of 1,517 in the number of bankswas, of course, not offset by any extension ofbranch systems. In the period of approxi-mately equal duration from February, 1927,when the McFadden Act went into effect, tothe end of December, 1929, the number ofbanks in the country decreased further by 2,343,the decrease within the branch-banking area of623 being relatively as well as absolutely lessthan the decrease of 1,720 outside this area, andbeing more than offset by an increase of 647 inthe number of branch offices. In the State ofCalifornia the number of banks fell off in eachof these periods, the decrease being more thanoffset in the first period and nearly offset in thesecond period by increase in the number ofbranch offices, so that the total number ofbanking offices increased in the first period from1,213 to 1,316 and fell off slightly in the secondperiod to 1,300 at the end of December, 1929.In other States of the branch-banking area,however, decreases and increases in the numberof banks and of branches have been in varyingproportions, and no close correspondence hasbeen in evidence. In New York, for example,where the increase in number of branch officessince the passage of the McFadden Act hasbeen double the increase shown for California,the number of banks has remained nearlyconstant, and this is true also of Michigan,the third State in number of branches in oper-ation at the end of December, 1929. In Penn-sylvania the number of banks decreased overthe whole period from June, 1924, to December,1929, by 84, and the number of branchesincreased by 87; in Ohio the number of banksfell off by 92, and the number of branchesincreased by 65; in New Jersey the numberboth of banks and of branches increased by89 and 82, respectively; in Massachusetts thenumber of banks increased by 2 and the num-ber of branches by 63; and in Maryland thenumber of banks fell off by 20 and the numberof branches increased by 36. The number ofbanking offices at the end of December, 1929,is given, by States, in Table 4. On this dateapproximately one-eighth of the total bankingoffices in the country as a whole were branchoffices.



Unit banks and chain, group, and branchsystems.Chain or group banking develop-ments are not reflected in changes in the num-ber of banks, since these developments repre-sent affiliation of corporately independent in-stitutions usually through stock ownership con-trol, by an individual or group of individuals,a bank or a holding company. The groupingup of bank offices of national, State member,and nonmember banks in chain, group, orbranch systems, and the number of independ-

ent unit banks of these classes at the end ofDecember, 1929, is shown in the followingtable, which gives a corresponding classificationof loans and investments of banks. In thistable, as elsewhere throughout the board'scompilations, only affiliations of three or morebanks are classified as chain or group systems.It follows that some single banks classified asindependent unit banks may be affiliatedthrough stock ownership with other singlebanks.

BANKING OFFICES AND LOANS AND INVESTMENTS IN AND OUTSIDE CHAIN, GKOUP, OR BRANCH SYSTEMS, BYCLASS OF BANK: DECEMBER 31, 1929

Banking officesbanks or branches

Classen f bankTotal

In chains or groups

Banks notoperatingbranches

Banks operatingbranches

Headoffices Branches

In independent branchsystems

Headoffices Branches

Unitbanks l

Number

Total..Member banks

NationalState

Nonmember banks.

28,17710,8488,4302,41817,329

1,98485575798

1,129

11983453836

1,4151,150550600265

703263121142440

2,1321,176477699956

21,8247,3216,480841

14,503

Loans and investments (in millions of dollars)

TotalMember banks

NationalState _..

Nonmember banks.

58,41735, 93421,58414,35022, 483

4,9133,7262,825901

1,186

6,264 (2)5,579 (2)3,083 : (2)2,496 (2)686 (2)

18,83913,3545, 9067,4485, 484

(2)

(2)(2)(2)(2)

28,40113,2759,7703, 50515,127

1 Banks operating no branch ollices, and not affiliated with any chain or group system. 2

Included in figures for head offices.

Of the 28,177 banking offices in operation atthe end of December, 21,824, or approximatelythree-fourths, were unit banks having nobranches and operating independently of chainor group systems; 2,103 were banks operatingin chains or groups; 1,415 were branches ofchain or group system banks, and 703 werehead offices and 2,132 were branch offices ofbranch systems operating independently ofchain or group-system affiliations. Unit banksunaffiliated with chain or group systems andoperating no branch offices reported approxi-mately one-half of the loans and investments ofall banks in the country.

Area of chain and group banking.Whilechain and group banking developments havenot been generally restricted by provisions inState banking codes, the area within whichthese developments have been relatively more

considerable in extent is composed largely ofStates which have prohibited the establishmentof branch banking officesas, for example, in.Minnesota, North Dakota, Kansas, Iowa,Illinois, Oklahoma, and Texas. Developmentsof this character have, however, by no meansbeen restricted to these States. In certainother States, particularly in several which haverestricted the development of branch bankingto the building up of home-city or local branchsystems, as in Michigan and New York, as wellas in California, which permits state-wide branchbanking, and in Florida, Georgia, and Mon-tana, chain or group banking has shown veryconsiderable developments. There were in factrelatively few States in which no affiliation ofbanking institutions in chain or group systemswas reported in December, 1929. The areawithin which such affiliations have been re-



latively predominant, however, comprises theCentral, Middle Western, Northwestern, andWestern States. This chain or group bankingarea is in general relatively much more extensiveand less clearly defined than the branch-banking area. Data for banks in and not inchain or group systems, operating and notoperating branches, are given, by States, inTables 5 and 6.

As has been noted above, a number of bankswhich operate branch systems, themselvesoperate as members of chain or group systems,and in individual instances these combinedbranch, chain, and group systems control verylarge resources and an extensive network ofaffiliated banks and branch offices operatingin several States and comprising national withState banks.

Number and loans and investments of chainor group systems.At the end of December, atotal of 287 bank chains or groups were inoperation, embracing 2,103 banks, with totalloans and investments in excess of $11,000,-000,000 or approximately one-fifth of total loansand investments of all banks in the country.

Banks operating in chain or group systems onthis date included 802 national, 136 State mem-ber, and 1,165 nonmember banks. Changesduring the last half of 1929 are summarizedin the following table:NUMBER AND LOANS AND INVESTMENTS OF BANKS

OPERATING IN CHAINS OR GROUPS: JUNE ANDDECEMBER, 1929

Class fcf bank and date

All banks:DecemberJune

Member banks:DecemberJuneNational-

DecemberJune

State-DecemberJune

Nonmember banks:December -June -

Number

Total

24,63025,110

8,5228,707

7,4037,530

1,1191,177

16,10816,403

of banks

Membersof chainsor groups

2,1031,821

938756

802645

136111

1,1651,065

Loans and invest-ments (millions ofdollars)

Total,all banks

58,41758,474

35,93435, 711

21, 58421,457

14, 35014, 254

22, 48322, 763

Membersof chainsor groups1

11,1778,300

9,3056,668

5,9084,159

3,3972,509

1,8721,632

i Based largely on condition figures published in July.

Increase during the last half of 1929 in thenumber of banks affiliated in chain or groupsystems was confined largely to nine States,

and to a relatively small number of systemsone system increasing in this period from 20to 92 banks, and one from 12 to 78 banks,while one system not in existence in June wasoperating in December 35 banks. Data forJune and December are given, by States, inTable 7, and for the nine States showing themore considerable increases, changes duringthe last half year are summarized in the fol-lowing table:

1 Number of banks operating in

; chains or groupsState

Decem-ber, 1929

Tota l . . . 2,103Minnesota 308Michigan _ 135North Dakota . . 114New York 102Washington 75Arkansas 72Montana . . _ 45Massachusetts 45Kentucky 16Other States 1,191

June,1929 Increase

1,821 !2 6 1 ;

86 J100

8 1 I59 !55 !32 !33 i

4 :1,110 !

2824749142116

1 1713121281

1 May include some banks not known to be operating in chains or

groups in June.

Size of banking chains or groups.Chain orgroup systems as reported for December, 1929,are classified by number of banks comprised inindividual systems for States in Table 8. Asummary of this classification is given below:^ T , i. i i 7 . N u m b e r ofNumber of banks in chain or group system: systems

3 banks 644 banks 565 banks 396 to 9 banks 8610 to 19 banks 3220 or more banks 10

Total 287

Of the larger chain or group systems in opera-tion on December 31, a very considerable num-ber comprised one or more banks operatingbranches, and while in a majority of instancesthe banking offices of these systems, includinghead offices of banks with their branches, werelocated in the same State as the offices of thecontrolling agencies, in some instances banksand branches of a single system were located inseveral States. One Minneapolis system con-trolled banks located in 8 States and in 4 Fed-eral reserve districts, and 1 group system withhead office in New York City, with aggregateloans and investments in excess of $1,400,000,-000 comprised two extensive branch systems inCalifornia, 1 of 287 and 1 of 160 branch offices,and 1 branch system of 34 branches located in



New York City. The system having the secondlargest aggregate of loans and investments com-prised 5 banks with 179 branch offices locatedin three StatesNew York, California, andPennsylvania. One Detroit system, the thirdlargest in aggregate loans and investments, con-trolled 21 banks with 213 branches all locatedin the State of Michigan, as were also thebranches of banks comprised in two othersystems with headquarters in Detroit. Detailof loans and investments and number of banksand branches is given in an accompanying tablefor chain and group systems with loans andinvestments in excess of $50,000,000.CHAINS OR GROUPS WITH LOANS AND INVESTMENTS IN

EXCESS OF $50,000,000: 1929

Rank by loans and in-vestments and loca-tion of controllingagency and of bank-ing offices controlled

10.

New York City:Total

New YorkCalifornia

Xew York City:Total _"___.

New YorkCaliforniaPennsylvania.

Detroit:Michigan _.

Boston:Massachusetts...

Chicago:Illinois

Pittsburgh:Pennsylvania

Buffalo:New York..

Detroit:Michigan

Minneapolis:Total

MinnesotaMontanaNorth Dakota.South Dakota.NebraskaIowaWisconsinWashington...

Minneapolis:Total.

MinnesotaMontanaNorth Dakota.South Dakota.Michigan

Xew York City:New York._

Chicago:Illinois

Boston:Massachusetts...

Chicago:Illinois

Milwaukee:Wisconsin

Pittsburgh:Pennsylvania,...

Providence:Rhode Island

Loans iand in- ! _vest- !

ments, Iin thou- ;sands of ;dollars: !19291 i

Number of banking offices Dec. 31,1929

Banks

|To-' tal

! Not op-1 Operat-: erating ! ing1 branches! branches]

Branches

1, 418, 361278, 482

1,139, 879

815, 684550,911225, 072

500 I35 !

j465

il84181

48234

448

20

|! 1 9 j:9549791084

; 92! 467

i 9I 1 0i 8

I i

39, 701

705,032 ,234 j,1 21 !

568, 312

512, 669

458, 901

425,436

403,996 ;iO9 H 35 i

339, 754208,18015,11614, 87522, 21335, 35824,3388,97310,701

339, 267252,78553,49614, 3789, 727

8,881

328, 789

270,719

194,642

171,453

168,466

167,180

153,331

6

13

25

9145

9 |10 j

! 4

! II

7

6

10

11

17978947

213

31

46

74

33

i li I

8139 jj 36 i13 , 13 I115 !! 15 !,11 j 11 i

3 | |l

74 ; 3 r

77351311

1

11

2

33

71

14 jj 14 j ;

18 j ! 6 I

22 jj 18 \]

8 ij 717 |i 3

14

5

5

17

6

2 i

11

1

1

1

12

4

1

141 Figures based largely on July Bankers Directory.

CHAINS OR GROUPS WITH LOANS AND INVESTMENTS INEXCESS OF $50,000,000: 1929Continued

Rank by loans and in-vestments and loca-tion of controllingagency and of bank-ing offices controlled

18. San Francisco:Total

CaliforniaWashington. __

19. Buffalo:New York

20. Chicago:Illinois

21. Nashville:Total _

TennesseeArkansas.

22. Syracuse:New York

23. Atlanta:Georgia.

24. Louisville:Total. . .

KentuckyOhio

25. Jersey City:New Jersey

26. Kansas City:Missouri

27. Seattle:Washington

28. Tulsa:Total

OklahomaKansasTexas _

29. Savannah:Total. . .-

GeorgiaSouth Carolina

30. Detroit:Michigan. _.

31. Columbus:Ohio.

32. Augusta: |Maine.._ j

Loansand in-

vest-ments,

in thou-sands ofdollars:1929 1

Number of banking offices Dec. 31,1929

33. Boston:Massachusetts...

34. St. Paul:Total

MinnesotaMontanaNorth Dakota-Wisconsin

146,138145,066

1,072

132, 477

132, 329131, 30897,02834, 280

115, 559

104,954

97,42972, 34125,088

94, 382

82,025

77, 75376,181

915657

67, 68359,951

7,732

61, 701

61, 302

59, 576

55,785

52, 93232,919

1,89315, 2332,887

Banks

To-tal!

Not op-eratingj branches branches1

Operat-ing

I Branches

23

61655

13

6

11

o

5

6

211911

54

11

3

7

0

71

1 :

i""" 1"""

s!5

1 :

1

4

2

1

1 ,

211

2 ,

12

3 ,

IS

2020

13

101 !

,7

10

2

10:)

29

13t - y

30 !1 !

3 2 |

Types of banking chains or groups.Threetypes of chain or group systems have been re-ported, which may be characterized with refer-ence to the controlling agency, as follows:

(1) Instances where control is exercised bya holding corporation, which hasusually been formed by interestsconnected with one or more of theprincipal banks belonging to thesystem.

(2) Instances where control is exercised bythe principal bank of the system,either through direct ownership ofstock by the bank, or through owner-ship by the stockholders or direc-tors of the bank.


150 FEDERAL RESERVE BULLETIN APRIL, 193a

(3) Instances of ownership of controllingor substantial interest in a numberof banks by an individual, family,or group of individuals.

Chain or group systems in the several Statesare classified with reference to these types ofcontrol in Table 8. Recent developments havebeen conspicuously of the first and secondtypes noted, and these developments, commonlyutilizing holding companies as controllingagencies, have been distinguished in some dis-cussions as "group systems/' the designation of"chain system" being reserved for organiza-tions of the third type. These classificationsby types of control are, however, very general,since the actual method and agency of controlvaries from system to system and may in thecase of any given system be modified from timeto time.

Suspension or failure of banks operating inchains or groups.On the basis of the bestinformation available, which is admittedly un-satisfactory for earlier years, it appears that atotal of 226 banks, with deposits of $102,-000,000, reported as belonging to 50 differentbank chains or groups suspended operationsduring the 9-year period 1921-1929. Of thesebanks 61, with deposits of $35,000,000, weresubsequently reopened.

Classification of States.In the tables givingdetails by States for chain, group, and branchbanking developments, the States have beengrouped with reference to provisions in Statelaws permitting, restricting, or prohibiting theestablishment of branches. No attempt has

been made to group States with reference tolaws affecting the ownership of bank stock byholding corporations, so as to show in whichStates the growth of chain or group systemsmay be retarded under such provisions. Amajority of the States have, in fact, adoptedno laws specifically regulating the developmentof chain or group systems. As has been noted,however, developments of this character havebeen more or less affected by provisions inState laws relating to branch banking, and thegrouping of States wdth reference to theirbranch banking regulations has accordinglysome significance for chain or group bankingdevelopments.

State-wide branch banking is permitted in9 States; the establishment of branches in thehome city of the parent bank or in territorynearly contiguous thereto is permitted in 10States; the establishment of any branches,whatever is prohibited in 22 States; and 7States have enacted no legislation expresslyeither permitting or prohibiting establishmentof branches. In Kentucky, however, which isincluded as one of these 7 States, the establish-ment of additional offices or agencies is per-mitted under court decisions, and 28 suchoffices were in operation in December; and inMichigan, another of these 7 States, the Statebanking department has raised no objection tothe establishment of home-city branches, ofwhich there were 439 in operation at the end of1929. The grouping of States with referenceto branch banking provisions in State bankingcodes is shown on page 258 of this issue of theBULLETIN.



TABLE 1.SUMMARY OF BRANCH BANKING DEVELOP-MENTS: 1924-1929

I Deo.Class of bank or branch I 31,

' 1929

Number of banks: jTotal j 24. (' 3 0Operating branches | 822

National banks 166State bank members. 180Nonmember com-

mercial banks 407M u t u a l savings

banksPrivate banks

June i Feb. I June30, 1 25, 30,192S ; 1927 1924

' |

N u m b e r o p e r a t i n gbranches

Only in home city.__Only outside home

city !Both in and outside j

home city ]Number of parent banks j

in cities with popula- !tion of I

100,000 or more __;50,000 to 100,000 J25,000 to 50,000. _,

Less than 25,000 .Not classified .

257

35181

315

25,115818164190

398

624

518

252

48

Number operating1 branch 4482 branches 1503-5 branches 1246-10 branches i 4111-30 branches . 41Over 30 branches ! 18Not classified :.

Number of branches: iTotal ' 3, 547

Of national banks._.; 1,027Of State bank mem- i

bers ..: 1,299Of nonmember com- i

mercial banks ; 1,115Of mutual savings

banks ; 99Of private banks 7In home city ' 2,432Outside home city. . . 1,115

Outside branches inplaces with populationof !

Less than 2,500 6122,500 to 5,000 - 1365,000 to 10,000 8610,000 or over 281

Number establishedDe novo as branches, 2,379By conversion of ;

banks 1,017Not reported 151

25,950 !i26,973835 I 779169 , 145186 ! 189

415 I 387

58 |7 i

526 !

2 6 2 J47 i

3,440993

1,298

1, 046

96

2,3621,078

59113384

270

3,230941

1,220

973

8610

2,2141,016

57212879

237

958153 !

853 !163

476

261

42

359 372 35384 81 6570 i 66 I 61

305 316 i 300

469150126354114

446127124353512

2,900390

1,560

863

1,929971

2,329 2,214 \ 1,996

735169

28,996714108191

387

28

391

283

40

2841082893 33

376129

176

3 33

2,293248

1,137

908

1,508785

- March. 1927.- Not separately tabulated; included with "Stale bank nonmembers."'c M utual savings and private banks.

TABLE 2.NUMBER OF BANKS OPERATING BRANCHESAND NUMBER OF BRANCHES IN OPERATION, BYSTATES, FOR SPECIFIED DATES

Class of bank orState

TotalNationalState memberState nonmember .Mutual savings.._Private

Number of banks operat-;ing branches j Numbor of branches

Dec. June31, 30,1929 1929

822 8181G6 164180 190407 i 398

65 624 i 4

Feb. i June ' Dec. June \ Fob. June25, : 30, : 31. 30. , 2.". 30,

1927 ! 1924 i 192'* h)2\) 1927 1924

779145189387 ,50 |8

714 ,:-i.547 '3.440 12. 900 2. 293108 ! 1, 027 Wi ' 390 248191 j 1,299 ,1,295 IL, oriO 1, 137387 1,115 i 1,046 I 863 908

28 99 96 | 76 (i)

I STATE-WIDE BRANCH BANKING PER-MITTED

Total I 216ArizonaCaliforniaDelawareDist. of Columbia..MarylandNorth Carolina ,Rhode Island ISouth CarolinaVermont ' 7Virginia j 39

B R A N C H E S R E S T R I C T E D AS TO LOCA-T I O N

Total ! 581 : 578 ;Georgia ! 16 16Kentucky ! 10 :. 9Louisiana 42 j 42Maine 24 24Massachusetts 88 j 86Michigan 62 j 61Mississippi i 11 , 11New Jersey 5 5 : 53New York 106 ! 106Ohio 55 ! 58Pennsylvania 80 81Tennessee ! 32 ; 31

526~2T412479681114106538222

4472?434236163111477516721

7 J2,207 2.121 1.726 : 1.3973928

10663 !

161 i43925

103722268185

3426108611544332510368225916967

391310654133401252151723113155

531293479833225213622039853

Total..AlabamaArkansasFloridaIndianaMinnesota...Nebraska.. .OregonWashington..Wisconsin...

ESTABLISHMENT OF BRANCHES PRO-HIBITED BY LAW*

4 I2 i

432157

9 !6 i2 i1 ;5 i9 '

962159

8

6 12 ;1 i6 !9 !

811217&

1 Not separately tabulated.2 Branches reported were established prior to prohibitory legislation.

Other States which have prohibited establishment of branches in whichno branches were in operation include Colorado, Connecticut, Idaho,Illinois, Iowa, Kansas, Missouri, Montana, Nevada, New Mexico,Texas Utah, West Virginia. States which have enacted no legislationrespecting branch banking in which, also, no branches were in operationinclude: New Hampshire, North Dakota, Oklahoma, South Dakota,and Wyoming.



TABLE 3.NUMBER OF BANKS OPERATING BRANCHES AND NUMBER OF BRANCHES IN OPERATION, BY CLASSOF BANK, BY STATES: DECEMBER 31, 1929

States

Number of banks operating branches Number of branches

Total National StatememberNon-

member Total

Operated by- Location i

Nationalbanks

Statebank

membersNon-

memberbanks l

| office cityTotal.

TotalArizonaCaliforniaDelawareDistrict of Columbia.MarylandNorth CarolinaRhode IslandSouth CarolinaVermontVirginia _

Total...GeorgiaKentuckyLouisianaMaineMassachusettsMichiganMississippiNew JerseyNew YorkOhioPennsylvania.Tennessee

Total.AlabamaArkansasIndianaMinnesota..Nebraska...Oregon"WashingtonWisconsin...

822 166 180 476 3,547 i 1,027 1,221 2,432 1,113

STATE-WIDE BRANCH BANKING PERMITTED

216

7 I53 !

30 !39 !11

37

12

63323

8

23

252

2342

3

156

536

56

2533

567

28

1,286 526

22863

13 '24 I

1247 7 3557 :1061 :

480

"12"

12

189 , 571 475 811

12105

2

" 2 4 "7

262

10278

111292667

471038

3183

24m11163

27

2254510

56

19491034

B R A N C H E S R E S T R I C T E D AS TO L O C A T I O N

581

1610422488621155

106558032

151 2,207

3928

10663

16143925

103722268185

484 624 1,930

2110

721

331 8 9 1943 !25

414353

27309

3946316738

144

6360715824317082

10443

1625496

142436

193

72123517630

233

193

2410

33

38

ESTABLISHMENT OF BRANCHES PROHIBITED BY LAW 1

25 54

4 !2 !2

|

27 i

1 Of the 2,432 branches located in head-office cities, 687 were operated by national banks, 1,163 by State bank members, and 582 by nonmemberbanks. Of the 1,115 branches located outside head-office cities, 340 were operated by national banks, 136 by State bank members, and 639 bynonmember banks.2

Branches reported were established prior to prohibitory legislation. See note 2 attached to Table 2.



TABLE 4.BANKS IN CHAINS OR GROUPS, OPERATING AND NOT OPERATING BRANCH OFFICES, NUMBER OFBRANCHES, AND TOTAL OF BANKING OFFICES (BANKS PLUS BRANCHES), BY STATES: DECEMBER 31, 1929

State

Banks in chains or groups Banks not in chains or groups

Number j!of banks |

Total.. 21,630

T o t a l1 number

2,103

Number! Operating branches j

operating;no

! branches Number

1,984 119

! TotalNumber ! numberbranches \

1, 415 22, 527

Numberoperating

noj branches

I 21,824

Operating branches

Number ,

Totalnumber

ofNumber \ b r a n c h e s

| branches:

703 i 2 , 1 3 2 i

Totalnumberof bank-

ing offices(branchesplus

banks)!i

3,547 | 28,177

STATE-WIDE BRANCH BANKING P E R M I T T E D

Total..Arizona --CaliforniaDelaware.. _District of ColumbiaMarylandNorth Carolina _Rhode IslandSouth CarolinaVermontVirginia

GeorgiaKentuckyLouisiana.MaineMassachusettsMichiganMississippiNew Jersey.New York.OhioPennsylvania.Tennessee.

2, 045

46437474123041633217104474

64 !

6 :49

i 3 ::

3 i

1 1

i

54 10

6 i41 . 83 !

1

ii !i1

562

547

141

1,981

40388444123041630215103474

1,775

3334337

! 29

201 205

96435

2C6 724

7 ; 2245 | 3167 1312 j 2430 12439 7710 2110 ; 567 . 1039 : 61

1, 286

2286313241247735571061

3,331

681,300

606535449368

274114535

BRANCHES RESTRICTED AS TO LOCATION

836

23251326113183711

191392153353227271181337

7,C87 ;

383 ''556 !215 '121 1405 j608 ,287 i508 '

1,025 !1,009 j1,518452 !

6, 610

369549175102330572277466937957

1,445431

ESTABLISHMENT OF BRANCHES PROHIBITED

477 1,371 2, 207 !

401975361042

7321

2015 ;9742 :108 :86 :23 '76 !

4.51 i250 ,1/2 :31

3928106631614392510372226818568

12,106

Alabama.Arkansas.Colorado.Connecticut.Florida..Idaho..Illinois.Indiana-Iowa.Kansas_Minnesota..Missouri.Montana.Nebraska-Nevada..New Mexico..Oregon-Texas.Utah.Washington.West Virginia.Wisconsin.

TotalNew HampshireNorth Dakota...OklahomaSouth Dakota...Wyoming _.

20 37 i

19 !3 |

19 '3 !

13 4 | 9

6

2 2 2

1 l\ 1l

2 3 j 5

444600331196611

1,182333671

1,8491,2831, 751

552

54 ! 13,418

NO PROVISION IN STATE LAW REGARDING BRANCH BANKING

1, 625

123412617387

292 292

114856132

114856132

1,333

12329853232654

1,333

12329853232654

369418274237235137

1,765978

1,2571,0691,0521,277

1958063556

2351, 308

104345297969

1, 625

12341261738786



TABLE 5.LOANS AND INVESTMENTS OP BANKS IN AND NOT IN CHAIN OR GROUP SYSTEMS, OPERATING ANDNOT OPERATING BRANCHES, BY STATES: DECEMBER 31, 1929

[In millions of dollars]

State

Total..

TotalArizona..California------DelawareDistrict of ColumbiaMaryland..North CarolinaRhode IslandSouth CarolinaVermont-Virginia

Total. . . .GeorgiaKentuckyLouisianaMaineMassachusettsMichiganMississippiNew JerseyNew YorkOhio...Pennsylvania..Tennessee

Total. . .AlabamaArkansasColoradoConnecticut._Florida _IdahoIllinois.-IndianaIowaKansasMinnesotaMissouriMontanaNebraskaNevadaNew Mexico..OregonTexasUtahWashington..West VirginiaWisconsin

iAll banks

58,417

Banks in chains or groups

Total |1

1 1 , 1 7 7 |i

Operating \ Operatingno branches' branches

4,913 | 6,264

Banks not in chains or groups

Total

47,240

Operating Operatingno branches branches

28,401 18,839

S T A T E - W I D E B R A N C H B A N K I N G P E R M I T T E D

6,623

813.420

167245837370533169250551

1,709

18 !1 , 5 2 8

1

153 !8 '1

213

18178

1

II41

1,496

1,350

1424

4,914

631,892

166245837370380161249551

2,326

385536098

521219147

i 108| 222! 360

2,588

251,339

1061473161512335527

191

36,642 '.

334 ,554 ji429 j|433 !

4,225 i|2,021 i|

212 |i2,388 h

17,222 I;2,691 i:5,703 !

430 ',

B R A N C H E S

5, 986

1661243370

8711,262

15396

2,01186

803149

i|

R E S T R I C T E D AS

1,624

3537172191

30212

16022632

66823

4,362

131871649

780960

3236

1,78554

135126

TO LOCATION

30, 656

168430396363

3,354759197

1,99215, 2112,6054,900

281

14, 500

136360165282

2,311534170

1,1634,8491,2263,093

211

16,156

3270

23181

1,043225

27829

10,3621,3791,807

70

E S T A B L I S H M E N T OF B R A N C H E S P R O H I B I T E D

14,130

282198262

1,336258

813,802

863782404901

1,1991443593841

2601,036

162460345917

3,252

32503037

13437

1,212419046

5831588162203

8210450

188

212

2,846

32503037

13437

1,212199046

4021588162203

8210450

120

77

406

22

181

68

135

10, 878

250148232

1,29912444

2,590822692358318

1,04163

2971838

178932112272345705

10, 785

237146232

1,29912444

2,590796692358318

1,04163

2891838

177932112269345665

93

132

26

8

1

3

40

TotalNew TTfvmpshirpNorth DakotaOklahoma __ . . _South DakotaWyoming

i NO PROVISION INi

1,019

3 1 11 112

401 i187

. . . . | 58

230

581034722

S T A T E LAW

230

58103

i 471 221

REGARDING BRANCH BANKING

789 !311 154 :

298 I9 0 36 :

789

311 i54 1

2989036



TABLE 6.NUMBER AND LOANS AND INVESTMENTS OF MEMBER BANKS IN AND NOT IN CHAIN OR GROUP SYS-TEMS, OPERATING AND NOT OPERATING BRANCHES, BY STATES: DECEMBER 31, 1929

[Amounts in millions of dollars]

Number of member banks

In chains or groups j Not in chains or groupsState

i Tota l ! Operat- Operat-' ingTotal ing no

branches branches

Total ! 8,522 \\ 938 855 83

Total

7,584

Operat-ing no

Operaing

branches branches

7,321

Loans and investments of member banks

In chains or groups j Not in chains or groups

Total

35,934

Total

9,305

Operat-1 Operat- jing no i ing

branches branchesTotal

i Opeiat-I ing no

3,726 ; 5,579 126,629

[branches branchesOperat-

ing

13,275 13,354

TotalArizona - __CaliforniaDelaware --District of Columbia. _MarylandNorth Carolina _Rhode Island _.South CarolinaVermontVirginia

71017 1 i1285 |72 11 4 ;55 '46 !

172 ;

STATE-

35 30 | 5I 1 i

30 ij 26 ; 4

; |i |

2 ;' i | I1 ! 1 i . .i ; I !.

:! 1

:!"" I

675

W18720128572125445

172

WIDE BRANCH BANKING PERMITTED

62014

174186

8066

7' 4 9

45161

55 , 4,106

2 4213 2,4742 .' 806 ' 1275 322

1,336

1,177

6 174 15 i 328 ! 1495 I 98

! 70

11 i 391

I 3 '1

I1

176 1,160

6 ;159 i 1,018

7 ! 14231

2,770

361,297

SO1973221741799569

391

1,106

1 21i 350

3345

15811725

1 53

; 69935

1,664

15947

4782

16457

15442

156

BRANCHES R E S T R I C T E D AS TO LOCATION

Total.-I 3,315

Georgia i 115Kentucky : 145Louisiana '' 42Maine 1 55Massachusetts ! 177Michigan | 273Mississippi j 38New Jersey.. ; 364New YorkOhioPennsylvaniaTennessee

277 i 204 73 i 3,038 ! 2,8

388 ;

4070

11955

2432

2

3

1

1021

104

3255

2 i2 1 I

1011333650

1432203632459638392393

97 '13030 i49 ,120 !200 '35 ;

295 I542 j358894 !89;

199

4361

23201

295425294

22,707

245328283145

1,6911,460

771,525

11,0051,9583,705

285

5,219

16411830 115

8351,074

8 i

2071,862

84717105

1,207

2931171571143

170305896

4,012 17,

1091,692

8121025313085638669

1,3189,143187454 I 1,874

128 I 2,98899 I 180

5,859 11,629

691488712738122468709

1,207711

2,005123

12621663

4751621

6097,9361,16398357


AlabamaArkansasColoradoConnecticut. _.FloridaIdahoIllinois _IndianaIowaKansasMinnesotaMissouriMontana _.NebraskaNevadaNew Mexico...OregonTexas.__ _UtahWashington....West Virginia-Wisconsin

3,895

11994

123676160

54423429125227618788

1601029

120689

42146131172

483

1317114

191529

43425

1341421

14281031

478

1317114

191529

33425

13214

2235

23281030

20

5

1

2

1

1

3,412

10677

112634245

51523025722714217367

1387

2497

66132

115131151

i 3,403! 105

77112634245

515229

; 257

22714217367

1361 7

24! 961 661

321 114i 1311 148I

91

1

2

1

1

3

8,544

211125218306164

542,575

436350203535856113190

1830

214861

86317202480

2, 557

31! 33

231 4

! 1201 26i 919! 27! 69

264691376946

82

749232

169

181

! 2,150

! 311 33

412026

9195

6926

288137

i 0940

82

74! 92

32100

1 46

407

22

181

69

135

5,987

18092

195302

4428

1,65640928117766

71944

1441028

140769

54148202299

5,926

18092

195302

4428

1,656397281177

66719

44136

1028

139769

54146202261

61

0)

12

8

1

2

38

TotalNew HampshireNorth DakotaOklahomaSouth DakotaWyoming . .

602

5712229410128

143

44553410

N O

143

44553410

P R O V I S I O N I N S T A T E LAW ]

459

5778

2396718

459

5778

2396718

REGARDING

578

7371

3316934

193

44973715

I

BRANCH BANKING

193

4497"3715

385

7327

2343219

385

7327

2343219

1 Less than $500,000.


156 FEDEEAL RESERVE BULLETIN APRIL, 1930

TABLE 7- -NATIONAL, STATE MEMBER, AND NONMEMBER BANKS IN CHAIN OR GROUP SYSTEMSNUMBER ANDLOANS AND INVESTMENTS, BY STATES: JUNE AND DECEMBER, 1929

[Amounts in millions of dollars]

State

Total

Number of banks ir

Total

Dec.

2; 103

June ,

1,821

N ational

Dec.

802

June

645

i chains and groups

State member

Dec. June

136 111

Nonmember

Dec.

1,165

June

1,065

Loans and

Total

Dec. June '

1 !11,177 1 8,300

investments of banks in chains or groups i

National

Dec.

5,908

June

4,159

State member

Dec.

3,397

June

2,509

Nonmember

Dec.

1,872

June

1,632

Total.

S T A T E - W I D E B R A N C H B A N K I N G P E R M I T T E D

64

ArizonaCaliforniaDelaware..District of Columbia.Maryland.North CarolinaRhode IslandSouth CarolinaVermontVirginia

65 33 33 29 28 1 1,7095 i 5 . 18

19 18 1,5283 ' 3 1

969.18 i' 6

1,476 9521

864 367

6 !.848 I 225

368 371

22612

3501

423

12402

1

1 ;1 :

153 153 j! 142 142

B R A N C H E S R E S T R I C T E D AS TO L O C A T I O N

Total. 509 387 193

Georgia..KentuckyLouisianaMaineMassachusetts..MichiganMississippiNew JersejrNew YorkOhioPennsylvania.. .Tennessee

2216101245

1352160

1026

4832

20 I

i33 i86 i215681

143 84 62 | 232

4823

!i2 I

26 !52 j1?!15 j1 1 I

462 '

1992

25 i45

15 ;8 .

2

725

1418

310

612

1416

10

182 i 5,986 ! 4,027

166124 ,

3370

87:65 1,26219 j 1517 ! 39620 2,011 1,571

2315

803149

027

157K

3353

530428

15358571

78292

2, 604

144783015

762366

897

62431

344105

i

1,581 j 2,617 j 1.S76 j 770 ,143 j30 i10 '

281 i21

225 :348 i

98 i 109 I 76 !576 ! 1,238 | 861 j

54

3 !55 i3 6 '

1 8 8 8 ,

190149 I

344 l62 ;

374 352 ! 8644

573

34325598

184134

NO P R O V I S I O N I N S T A T E LAW R E G A R D I N G B R A N C H B A N K I N G

1 Based largely on figures taken from the Bankers Directory for June, 1929.

30

TotalAlabamaArkansasColorado..ConnecticutFloridaIdaho .IllinoisInd iana . . . . .IowaKansas...MinnesotaMissouriMontana.NebraskaNevada.New MexicoOregon . _TexasUtahWashingtonWest VirginiaWisconsin

11,238 | 1,101

22 ' 197916

840

5516

4X41 4184 i 7917 j 1087 8388 i 85

308 j 26136 1 34457313

36

326816

833

84 7926 2775 59

58 53

! 438

1315114

191120

3324

1329

162235

1825(\

28

21

I

361

101011

1411192

3122

10398

1845

16216

22

19

:STABLISHMENT

45

2

49111255

5343

40

2

48111253

5341

755

955

I212655135363

17422245110

4i 13

561644

37

OF B R A N C H E S P R O H I B I T E D

700

943

5

2926525162

156202150123

12551736

34

3,25432503037

13437

1,212419046

5841588162203

8210150

189

212

2,4167

4130

12937

996307344

2691574527233

82895079

205

2,145

3122234

12017

729

6824

467264146

1 82

717829

154

181

1,552

71523

9417

6634

5122

19426131492

696229G3

: 175

411

11

9190

221

2111

29

314

315

262

11

96122

112

11123

314

31

696

117

73314

n293142120

11520121612

18

121820

31i

599

114

7

3511

2713

21207420

91314

10121815

30

TotalNew HampshireNorth DakotaOklahomaSouth Dakota . . .W yoming

j! 292|

114! 85

. . . 61 3 2

. . . . .

268

100825432

138

445431

9

108

3045249

5

131

5

131

149

70302722

155

70362722

230

58103

4 7 '22 |

201

44963922

192

4497

'< 3615

162

30892815

2

2 .

2

2

35 i

14 :6 i9 16 1

36

14796



TABLE 8.SIZE OF CHAIN OR GROUP SYSTEMS AND CHARACTER OF CONTROLLING AGENCY, BY STATES:DECEMBER 31, 1929

State

Total

Total

Arizona.California.Delaware.. _ _District of ColumbiaMarylandNorth Carolina - _- -Rhode Island _South CarolinaVermontVirginia

Total..GeorgiaKentucky _LouisianaMaine __Massachusetts.._MichiganMississippi . _ New JerseyNew YorkOhio. _.Pennsylvania. _Tennessee

TotalAlabamaArkansas..ColoradoConnecticutFloridaIdahoIllinois _. .IndianaIowaKansas._Minnesota . .MissouriMontana.. .Nebraska . . .Nevada _New Mexico _Oregon _.Texas _Utah .WashingtonWest VirginiaWisconsin

Total !number ,

287

8

151

1

84

53225

113

1520

2124

171

4331

3123

121937

210

12

165

12

6

3 banks

64

3

I1

1

30

2

1

1

10

; 7i 2

28

I 1j 1

! I1

24

1

i 11 4

! 4

i 5

1

Bank chains or groups

Number comprising

4 banks

56

5 banks

39

6 to 9banks

86

10 to 19banks

32

20 ormore

10

Maxi-mumsize1

92

Controlled b y -

Holdingcom-

panies

53

STATE-WIDE BRANCH BANKING PERMITTED

1

1

3

12

1

1

17

6173

3

3

3

Banks

44

1

Individ-uals

190

4

121

BRANCHES RESTRICTED AS TO LOCATION

15

111

112422

10

1

13

13

1

17

211131123

2

8 4

31

3

i2

l ; l

66

7969

2035109

4

66

25

12

133

112

11


38

1

2

2

564

4

1

o

3

23

11

2

372

1

1

211

1

57

1111415216

18323

1421

20 5

11

I !2 '

4

4

21

11

1

1

3

11

921011878

1016

177

9298

10125

10122522

18

24

1

11

1

31

1511

1

1

29

11211

1102

-

3

14

2

15

31

11

303

18246141

133

133

291

121934

62

10112

1435

5

TotalNew HampshireNorth DakotaOklahomaSouth Dakota .Wyoming _ _

24

0855

NO

3

11

1

PROVISION

2

2

IN STATE

6

1212

LAW

9

9

4

REGARDING

3

21

1

1

BRANCH

21 i

i1421 !

5 :

BANKING

1

1

23

6755

1 Maximum number of banks in any single chain or group system.



NATIONAL SUMMARY OF BUSINESS CONDITIONS[Compiled March 21 and released for publication March 24]

Industrial production increased in February,while the number of workers employed in fac-tories was about the same as in January.Wholesale commodity prices continued todecline. Credit extended by member bankswas further reduced in February, but increasedin the first two weeks of March. Money ratescontinued to decline.

Production.In February industrial produc-tion increased about 2 per cent according tothe board's index, which is adjusted to allowfor seasonal variations. This increase reflectedchiefly a substantial gain in the output of ironand steel. Automobile production was inlarger volume than during January but was 30per cent smaller than the large output of ayear ago. Cotton and wool consumption bymills was substantially lower in February, andproduction of bituminous coal and copper alsodecreased.

In the first two weeks of March the outputof steel mills declined in comparison withFebruary, contrary to the usual seasonal move-ment. Bituminous coal output also was smaller.

The volume of building contracts awarded inFebruary was about the same as in the preced-ing month, according to the F. W. DodgeCorporation. Residential building continuedat an exceptionally low level, while contractsfor public works and utilities were large incomparison with the corresponding month inother recent years. Awards in the first twowreeks of March were larger than in the firsthalf of February.

Employment.The volume of factory em-ployment, which had reached a low point inJanuary, showed little change in February,when an increase usually occurs. Factory payrolls increased during the month, but by asmaller amount than is usual at this season.In the steel, automobile, agricultural imple-ment, and tobacco industries, employment in-creased during the 4-week period, while furtherdecreases occurred in the cotton and wooltextile, lumber, automobile tire, electrical ma-chinery, and machine-tool industries.

Distribution.Freight car-loadings on anaverage daily basis were slightly larger thanin January, but smaller than in the correspond-ing month of any other recent year. Slight

seasonal increase was reported during earlyMarch. Department-store sales in Februarycontinued to be below the level of a year ago.

Prices.Wholesale prices of commoditiesdeclined further during February, and theBureau of Labor Statistics index at 92.1 percent of the 1926 average was at the lowest pointsince January, 1922. Marked declines oc-curred during the month in the prices of manyagricultural productsgrains, hides, raw wool,and cotton; in certain imported raw materials,notably sugar and silk; and also in textiles,petroleum, and pig iron.

During the first part of March, a number ofthese commodities declined still further inprice. Wheat and cotton prices were con-siderably lower, and silver reached the lowestpoint on record. By the middle of the month,however, prices of cotton, hides, and silver hadrecovered somewhat.

Bank credit.Liquidation of credit at mem-ber banks continued throughout February, andon February 26 total loans and investments ofmember banks in leading cities were in aboutthe same volume as in the early summer oflast year. During the following two weeks,however, there was an increase of $230,000,000in loans and investments, chiefly in loans onsecurities. All other loans, largely for commer-cial purposes, increased slightly.

From the middle of February to the middleof March the volume of reserve-bank creditoutstanding decreased further by $90,000,000.This decline reflected chiefly an increase ingold stock of $75,000,000 and a further declineof money in circulation, offset in part by someincrease in member-bank reserve balances.Member-bank indebtedness at the reservebanks declined to $267,000,000, the lowest levelsince early in 1925; reserve-bank holdings ofbills declined, while those of United Statessecurities increased.

Money rates in the open market eased fur-ther, and bond yields declined rapidly to thelowest level since 1928. At the middle ofMarch the discount rate at the Federal ReserveBank of New York wras reduced from 4 to 3}iper cent, and the rate at the Cleveland, Phila-delphia, and San Francisco banks from 4} to4 per cent.


FEDERAL RESERVE BULLETIN 159

FEDERAL RESERVE BANK CREDIT

RESERVE BANK CREDIT OUTSTANDING AND PRINCIPAL FACTORS IN CHANGESMILLIONS OF DOLLARS MILLIONS OF DOLLARS5W0

5200

5000

4800

5

160 FEDERAL RESERVE BULLETIN APRIL, 1930RESERVE BANK CREDIT OUTSTANDING AND FACTORS IN CHANGES

[Averages of daily figures. In millions of dollars]

Month or week

Reserve bank credit outstandingi

1928December1929January

FebruaryMarchAprilMayJuneJulyAugustSeptemberOctober..NovemberDecember

1930JanuaryFebruaryMarch

Week ending (Saturday)Mar. 1Mar. 8Mar. 15Mar. 22Mar. 29

Bills dis-counted

1,013859889969

1,004956978

1,0961,043

969885953803501378274

360329267246230

Billsbought

4834733852651561459975

124229337296320314285246

289261238209261

UnitedQtotOGoiaies

securities

263229184197165153179147155165154315446485480540

482494554593528

Otherreservebank

creditTotal

Factors of decrease

ealock

1,8241,6131,5021,4811,3771,3031,3171,3801,3761,4271,450 !1,631 '1,643 I1, 357 j1,181 I1,095 i

1,165 j1,126 i1,0951,078 I1,053 !

4,1424,1154,1434,1664,2264,2924,3114,3354,3514,3684,3814,3744,3244,2834,3194,395

4,3444,3644,3884,4074,419

~

Factors of increase

Goldstockat end

ofmonth

4,3624,3054,2664,1604,1094,1134,1234,1254,1424,1284,141

4,1274,1534,1884,2604,3014,3244,3414,3604,3724,3864,3664,284

4,2934,3554,421

Increase or decrease ()month

Total

-11 .2-57 .638.7

-105. 751.0

3.410.32.1

17.3-14.0

13.2-237.914.4 '

26.4 !34.472.440.623.416.318.912.114.4

-19 .8-82 .3

142.4

8.861.966.8

Throughnet goldimport

orexport

-11 .1-94 .991.2-81 .7-79 .9-63 .9

0.70.5

13.36.7

23.3-392. 0

47.225. 524.823.123.630.234.718.417.617.5

-23 .2-64.4

175.1- 4.0

60.047.5

Throughear-

markingopera-tions

2.935.845.7

-26 .530.160.95.9

1.21.2

-25 .0-15 .7119.6

-65.07.5

48.616.1

- 7 . 5-22.01.0-6.6- 4 . 5

1.0-22 .0-55.4

2.50.0

13.0

frb_041930

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