202

BANKING STANDARDS
TABLE 124

NUMBER OF DIsTRICT-VEARS IN WHIicH MEMBER BaANKs HAp RATIOS
oF Time Deposits AND Ratios oF TOTAL EXPENSE,
DEVIATING CLASSIFIED PERCENTAGE AMOUNTS FROM
DISTRICT AVERAGES, 1919-1925*

RATIOS!
Time Deposits to
Total Deposits
(Percentage Differences)

Position

Amount

RATIOS:
Total Expense to Gross Earnings
(Percentage Differences)

.
i p——

Abhnere

6.00 4.00 2.10
and to b 7% | Under
over 6.00 aan 2:00

Below
2.7) 4.00 6.00
Under te to | and
2.00 4.00 6.00 over

20.00 and over

ADOVE

10.00 to 20.00

€

Under 10.00

Under 10.00

Below

10.00 to 20.00
20.00 and over]

a

*Boston district a=r1010; b=1020; c=1921; d=1022; e=1923; f=1024; §=1925

little balance is left for profits. When, however, the proportion
of savings deposits exceeds 75% of all deposits, earning power
again begins to increase because under such conditions it is not
necessary to maintain a large clerical organization.”*®
The type of association between net earnings and time deposits
 found for the classified member banks in the Boston district
 is paralleled by member banks for the country as a whole,
in spite of differences in bank location and size and of the fact
that in the present analysis member banks in a given district are
treated as a single institution.
Positive correlation between ratios of total expense to gross
earnings and of time deposits to total deposits, for the member
banks in the Boston district treated as a single institution and
for the member banks in all districts similarly treated, for each
of the years 1919 to 1925—one pair of ratios for each year—is
"16 Curtiss, op. cit., Report for 1924, pp. 1-2.