National banking under the Federal Reserve System

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Monograph

Identifikator:: 1757542345

URN:: urn:nbn:de:zbw-retromon-135097

Document type:: Monograph

Title:: National banking under the Federal Reserve System

Place of publication:: New York

Publisher:: The National City Bank of New York

Year of publication:: 1927

Scope:: 154 S.

Digitisation:: 2021

Collection:: Economics Books

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Document type:: Monograph

Structure type:: Chapter

Title:: Growth of the national banking system

Collection:: Economics Books

GROWTH OF THE NATIONAL BANKING SYSTEM winning some concessions. The old spectre of the greenbacks was still sharing in the government’s consideration of currency matters. Bank circulation was measurably reduced during the period, both in total volume and per dollar of national banking capital. Whereas in 1882 there was $.65 bank circulation for every $1.00 of national bank capital, in 1899 there was $.84 bank circulation for every $1.00 national bank capitalization. The chief causes for this reduction were: 1—Three per cent. bonds constituted a large portion of the nation’s debt and were redeemable at the pleasure of the government; they were being rapidly retired and were hence undesirable as a basis for note issue. 2—All other issues of government bonds were selling at high premiums. Four per cents reached 130-4. Circulation predicated on bonds at this market value was, of course, altogether unprofitable. 3—The Government was purchasing silver, coining dollars and issuing silver certificates at a rate never lower than 2,000,000 per month and was using every means at its command to force these silver certificates into circulation, in direct competition with banks notes. But while circulation was declining, relatively, the practice of the bank extending its credit through deposits was rapidly gaining head- way. The following brief tabulation shows at a glance the relation of individual deposits and of loans to national bank capital stock at the beginning and the close of the period. The figures are compiled from the Comptroller’s Statements taken as near as possible to the ends of the fiscal years 1882 and 1899. YEAR 1882 1899 DEPOSITS PER LOANS PER $1 OF CAPITAL $1 OF CAPITAL $2.24 $2.53 4.17 4.12 This was a very remarkable stride toward banking principles as we see them in operation today. At the close of 1899 there were in active operation 3602 national banks in the United States as com- pared with 2308 at the end of 1882. The average yearly increase for the period was 76. 15 |

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