and time deposits of $8,182,000,000, which showed an increase of $98,000,000. Total capital funds of $3,390,000,000 represented an increase of $116,000,000. Common stock increased $9,000,000 while preferred stock decreased $19,000,000. Surplus, profits, and reserves increased $126,000,000. Figures with respect to the above mentioned asset and liability items of national banks, together with a balance sheet covering each of the four calls made on such banks in the year ending October 31, 1939, appear in the accompanying tables: Changes in principal items of assets and liabilities of national banks, year ending June 30, 1939 Number of banks. [In millions of dollars] ASSETS Loans and discounts: Loans to brokers and dealers in securities and other loans for the purpose of purchasing or carrying stocks, bonds, and other securities. Real estate loans. Cash, balances with other banks, including reserve balances and cash items in process of collection. Total assets.. LIABILITIES Demand deposits: Individuals, partnerships, and corporations.. Other. Total demand deposits.... 1 Represents only increase in loans to brokers and dealers in securities since prior to Dec. 31, 1938, loans to other than brokers and dealers in securities included all loans, except loans to banks, secured by bonds, Assets and liabilities of national banks on dates indicated—Continued Gross earnings of national banks in the year ending June 30, 1939, were $839,000,000, or $11,000,000 less than those of the preceding year. Interest and discount on loans equaled $377,000,000 and interest and dividends on bonds, stocks and other securities $304,000,000. Expenses were $9,000,000 less than in the preceding year, amounting to $577,000,000. Of this, salaries, wages, and fees accounted for $250,000,000 and interest on deposits and borrowed money, for $118,000,000. Net operating earnings were $262,000,000, which were increased by $212,000,000 of recoveries. Recoveries on loans were $33,000,000; recoveries on bonds, stocks and other securities, $35,000,000; and profits on securities sold, $130,000,000. Losses and depreciation of $249,000,000 were $31,000,000 more than in the preceding year. Losses on loans were $85,000,000 and losses on bonds, stocks, and other securities, $116,000,000. Net additions to profits were thus $225,000,000 and were $17,000,000 more than those in the previous year and were 6.75 percent of capital funds. Interest and discount on loans accounted for nearly 45 percent of the gross earnings in the year ending June 30, 1939, varying in ratios from less than 33 percent in Federal Reserve district No. 7 to approximately 57 percent in district No. 12. Interest and dividends on investments were 36 percent of total earnings, with the banks in district No. 11 showing the smallest ratio of 25 percent and those in district No. 3 the largest ratio of 46 percent. Salaries, wages, and fees were 30 percent of total earnings, ranging from nearly 24 percent in net operating earnings to gross earnings showed averages of from 25%1⁄2 percent in district No. 9 to 35 percent in district No. 3. Interest and discount on loans to total loans were 41⁄2 percent and varied from less than 3%1⁄2 percent in district No. 2 to 5% percent in district No. 11. Interest and dividends on bonds, stocks, and other securities averaged 2% percent of total investments, the banks in district No. 2 showing the lowest ratio of 2 percent while the banks in district No. 3 showed the highest ratio of nearly 3% percent. Profits on securities sold during the period were 1 percent of total investments, varying from 4 percent in district No. 9 to 1% percent in district No. 12. Net operating earnings were 8 percent of total capital funds, the lowest ratio being 6 percent in district No. 1, and the highest ratio 11 percent in district No. 12. The net additions to profits for the period were 64 percent of capital funds, the average ranging from 44 percent in district No. 2 to 104 percent in district No. 10. The proportion of gross earnings which were preserved as net additions to profits before dividends were better among the larger banks than among the smaller for the calendar year 1938. For banks with deposits of more than $100,000,000 the ratio of net additions to profits to gross earnings was 26.8 percent while for banks of $500,000 deposits or less it was 18.8 percent. Changes in the earnings and expense figures of national banks in the year ending June 30, 1939, together with a comparison of earnings and expense figures for each of the 5 years ended June 30, 1939, appear in the accompanying tables: Earnings and expenses of national banks for year ending June 30, 1939 |