)O

BANKING STANDARDS

computed for each district and for all districts, for each year and
for all years, and the ratios are studied in keeping with the form
of analysis already described, norms and trends of the character
indicated obtain.

(2) The Relation of Total Expense to Gross Earnings
A. All Member Banks

Expenses of operation of the banks, by districts, may be expressed
 in terms not only of earning assets but also of gross earnings—the
 funds out of which they are paid. This is done for the
purpose of determining the norms and trends, if any, characteristic
 of such ratios as thus expressed. We shall later observe
the similarities and differences in these respects for two groups of
banks—national, and state bank and trust company members. Attention
 is now addressed to the entire bank membership—all
banks in a given district being treated as a single institution.
For the period 1919-1925, taken as a unit, all member banks
paid as operating expenses $69.80 out of each $100 of gross earnings
 received. That is, operating expense as a percentage of
gross earnings was 69.80. The year of highest expense thus
measured was 1924, the average amount for all members being
72.00%; that for the lowest year, 1920, was 67.10%. On the
basis of the seven-year average, the percentage was least, 63.40,
TABLE 62

Ratios oF Total EXPENSE To GROSS EARNINGS IN ALL MEMBER
Banks, FEDERAL RESERVE SYSTEM, BY YEARS AND
BY FEDERAL RESERVE DISTRICTS

FEDERAL RESERVE DISTRICTS

Average
(All Districts)

Boston. . .... EERE
New York,  «oooviinnisnnean
Philadelphia. ...............
Cleveland...... ............
Richmond...... .. ........
Atlanta.........e00 cenrenen
Chicago. .......vveerennnnn.
5Y LomiSn ¢ 5 su o swim os vere s 2
MVinneapolis.......ooovvnnnn.
Kansas City. .......o0cvuen.
Dallas......... “5g memo B80
San Francisco. . .

Ra=r~e or T. ~ 41 FXPENSE' "ROSS FARNINGS
verage \ |
1010-1 1919 1020 | 1921 1922 | 1023 | 1024 1028
1925)
60.80 ! 67.90 67.10 I 69.30} 69.30 I 70.70 72.00 | 71.60

39.6¢
6.40
3.40
9.60
‘0.40
1.20
~.70
~.60
+.go
_.70
3.20
72.00

t-3
vo. 20
64.2¢
$7.60
69.20
£5 ar
re ©

6.8¢
35.00
33.00
5.50
7.20
6.70
‘9.00
~7.00
"7.10
2.70
53.70
.8.30 |

J§5.7¢
66.30
62.70
69.40
72.10
73.70
vQ.70
6¢.8c
70.10
75.40
72.90
72.80

Jo IC
b4.8¢c
61.50
69.20
70.30
73.20
39.60
0.50
‘0.70
48.00
73.20
72.00

9
ig.
ie
69.70
..20
. 20
.3¢
4

8c
6
64.2
"2.1
70.0¢
73.1c
74.3¢
2.70
a 7¢
..80
.-.30
76. 20

71.10
67.70
65.30
71.70
72.70
70.90
74.8¢
72.60
80.70
77.60
71.00
nq .60

"a
-c.80
06.10
67.20

. ea
v2.6.
76 10