CLASSIFICATION OF LOANS BY NATIONAL BANKS IN NEW YORK CITY, JUNE, 1913 TO 1917.

As about 21 per cent of the loans of all national banks on June 20, 1917, were made by banks located in the city of New York, the following statement is of interest as showing the amount and character of loans by banks in that city at date of the June calls, 1913 to 1917, inclusive:

[In thousands of dollars.]

It will be noted from the above table that while loans on time, secured by stocks and bonds, increased from June, 1915, to June, 1917, only $22,833,000, or about 10 per cent, paper on time not secured by collateral, increased during the same period $331,537,000, or approximately 70 per cent.

OVERDRAFTS.

There has been no great fluctuation in the amount of overdrafts outstanding at the time of the various calls during the year, but the percentage of total overdrafts to total deposits shows a diminishing tendency.

The expressions of commendation which the Comptroller's office has received from banks throughout the country, regarding the efforts of the office to correct and eliminate an abuse for which there was no excuse, and which had become a source of serious loss to some banks, have been gratifying.

UNITED STATES BONDS.

The aggregate holdings of Government bonds declined during the first three report dates to $714,523,000 on March 5, 1917, the lowest amount reported. From that date on United States obligations held by the banks have increased owing to the purchase of United States certificates of indebtedness, which are reported under bonds, making the increase from March 5 to September 11, 1917, $226,559,000. In addition the banks reported on September 11, 1917, $217,900,000 of Liberty 3 per cent bonds held, making an actual increase since March 5, 1917, of $444,459,000 in the bonds of the United States held by the banks. Of the total amount held on September 11, 1917, $1,158,982,000, the bonds deposited to secure circulation amounted to $678,180,970, or more than one-half of the total holdings.

OTHER BONDS, SECURITIES, ETC.

An increase of $238,994,000 is shown in these investments between September 12, 1916, when they aggregated $1,624,627,000, and September 11, 1917, when they amounted to $1,863,621,000. The increase was practically continuous throughout the year, each succeeding report, with one exception, showing a greater amount than the preceding report.

STOCKS.

Stocks other than stock of Federal reserve banks increased $2,768,000 since September 12, 1916.

Stock of the Federal reserve banks increased $1,557,000 between September 12, 1916, and September 11, 1917. This investment increases with the number of member banks and with the increase of capital and surplus of already existing member banks, while a reduction in capital or surplus or liquidation of member banks will reduce the capital of the Federal reserve banks, and consequently the stock holdings of the member banks, proportionately.

INVESTMENT SECURITIES OF NATIONAL BANKS CLASSIFIED.

The investments of national banks in United States bonds, and in other bonds and securities and stocks on June 20, 1917, amounted to $3,013,068,000, an increase of $661,108,000 since June 30, 1916. The following table shows the character of the investments held by the national banks in June, 1916 and 1917:

A very large increase will be noted in the amount invested in both domestic and foreign Government securities. The amount of foreign Government securities owned has more than doubled during the year, and investments in securities of the United States have increased $345,051,000. The increase in investments in domestic bonds (exclusive of United States bonds) as indicated by the first four items of the table, amounts to $118,351,000.

This table shows graphically the extent to which the national banks of this country have assisted during the year in furnishing credit to this country and its allies. Of an increase in this period of 28 per cent in security holdings, practically 22 per cent consisted of bonds of this and foreign Governments, the latter being principally Governments now allied with the United States in war against Germany.

DOMESTIC AND FOREIGN SECURITIES HELD BY NATIONAL BANKS.

The following table shows domestic and foreign securities held in June of each year since these securities have been separately classified:

The amount invested in banking house and furniture and fixtures, which was $291,335,000 on September 12, 1916, increased by $13,466,000 during the year, and on September 11, 1917, stood at $304,801,000, or 13.6 per cent of the capital, surplus and profits of the banks. Other real estate owned declined from $47,627,000 on September 12, 1916, to $46,273,000 on September 11, 1917.

DUE FROM BANKS.

The amendment to the Federal Reserve Act approved June 21, 1917, provided among other things that thereafter all lawful reserves of national banks which are members of the Federal reserve system should be carried in their respective Federal reserve banks, thus eliminating from the reserve calculation lawful money in vault, and the amounts due from reserve agents in reserve and central reserve cities.

The reports of condition rendered by the national banks as of June 20, 1917, were the last required under the law permitting the inclusion in lawful reserve of balances due from approved reserve agents, and showed the banks to be in a position which easily permitted the transfer of reserves to the Federal reserve banks.

The transfer was accomplished without disturbance to money conditions, and by the time of the succeeding report, rendered as of September 11, 1917, balances carried by national banks with Federal reserve banks had increased in the sum of $352,226,000 and aggregated $1,172,810,000. The amount transferred to the Federal reserve banks during this period of less than three months, exceeded by more than $35,000,000, the total balances carried by national banks with the Federal reserve banks September 2, 1915, just two years previous. During the report year under consideration, balances due to national banks from Federal reserve banks increased $641,782,000, or from $531,028,000 on September 12, 1916, to $1,172,810,000 September 11, 1917.

NATIONAL BANK DEPOSITS WITH FEDERAL RESERVE BANKS.

The following table shows increases and decreases of deposits with the Federal reserve banks since the beginning of the system:

The amount due from all banks other than Federal reserve banks declined from $1,716,939,000 on September 12, 1916, to $1,633,604,000 on September 11, 1917, a reduction of $83,335,000.

Balances of all classes of banks combined aggregated $2,806,414,000 on September 11, 1917, an increase of $558,447,000 over the amount shown on September 12, 1916

SPECIE AND OTHER LAWFUL MONEY.

As national banks are no longer required to maintain a portion of their reserves in lawful money in the vault, the classification of "Money on hand" was discontinued in the abstract for September

11, 1917.

The following table, however, shows the changes in holdings of various classes of coin and certificates between the calls of June 30, 1916, and June 20, 1917, the net result being a decrease in the aggregate amount held of $83,793,000

Comparison of coin and certificates held by all national banks on June 30, 1916, with June

June 30, June 20, De-
1916.

In

1917.

crease.

crease.

11,023

83,793

The total cash in vault, which includes Federal reserve bank notes, Federal reserve notes, and notes of other national banks (not included in the above table), as well as legal-tender notes and other lawful money of the United States reported on September 12, 1916, was $845,185,000, while on September 11, 1917, it was $493,609,000, a reduction of $351,576,000. This is accounted for by the change in reserve requirements, the banks at this time keeping on hand only such cash as they need for use in current business. In the same time the balances carried with the reserve banks increased from $531,028,000 to $1,172,810,000, as heretofore stated.

EXCHANGES FOR CLEARING HOUSE.

Between September 12, 1916, and November 17, 1916, exchanges increased from $392,684,000 to $516,705,000. They show a decline on December 27, 1916, and reached the highest point for the year on May 1, 1917, when they amounted to $578,145,000. After that date they again showed a reduction at each call, and amounted to $401,742,000 on September 11, 1917. The net increase in exchanges between September 12, 1916, and September 11, 1917, was but $9,058,000, and they did not at any time reach the high aggregate shown for the preceding year.

LIABILITIES, CAPITAL, SURPLUS, AND UNDIVIDED PROFITS.

The capital stock of the national banks on September 11, 1917, stood at $1,090,318,000, an increase as compared with September 12, 1916, of $22,753,000. Surplus during the same period increased from $731,409,000 to $769,050,000, while undivided profits advanced from $317,050,000 to $354,023,000.

The total capital, surplus, and undivided profits on September 11, 1917, stood at $2,213,391,000, an increase during the year of $97,367,000.

CIRCULATION OUTSTANDING.

Outstanding national bank circulation decreased between September 12, 1916, and September 11, 1917, by $8,473,000, the amount on the latter date standing at $665,642,000. The amount declined to May 1, 1917, but shows an increase at the time of both calls since that date.

The volume of circulation outstanding at the date of each call during the year ended September 11, 1917, issued by national banks in New York, the three central reserve cities, other reserve cities, and in the country outside of reserve cities is shown in the following table in millions of dollars: