Banking standards under the federal reserve system

Bibliographic data

Monograph

Identifikator:: 1762969653

URN:: urn:nbn:de:zbw-retromon-142432

Document type:: Monograph

Title:: Banking standards under the federal reserve system

Place of publication:: Chicago

Publisher:: A. W. Shaw Company

Year of publication:: 1928

Scope:: xxxviii, 420 Seiten

Digitisation:: 2021

Collection:: Economics Books

Usage license:: Get license information via the feedback formular.

Chapter

Document type:: Monograph

Structure type:: Chapter

Title:: Part IV. Norms, trends, and correlations of series in the Boston and in the New York districts by Member Banks

Collection:: Economics Books

278 BANKING STANDARDS vidual member banks obtain within the several districts? No answer can be given to this question for districts other than Boston, and for it only in certain respects. But limited as are the data which are suitable for functional analyses of the types sresented in Part III, they indicate that what is true for the several districts for the years 1919-1925, as respects the rela- tions of gross earnings to total expense and to net earnings—all series being expressed in terms of earning assets—is also true for the individual banks in the Boston district for the years 1924 and 1925. Let us review briefly our findings in these respects for the district ratios. For the years 1919-1925, it was found that (1) districts which had high or low gross earnings ratios had high or low ratios, respectively, of total expense and of net earnings; (2) the higher or lower the gross earnings ratios the higher or lower, respectively, the ratios of total expense and of net earn- ings, the standards of reference which determine the positions of the district ratios being their respective seven-year averages; and (3) increasing gross earnings ratios are accompanied by increasing, and decreasing gross earnings ratios by decreasing ratios of total expense and of net earnings. These conditions obtain for all districts and for the Boston district, separately, for the years 1919-1925, and for all districts for changes between 1924 and 1925. The foregoing comparisons, it should be remem- bered, relate to district ratios and summarize prevailing ten- dencies. Are they essentially duplicated by the individual member banks in the First district? To answer this question calls for detailed analysis. For the years 1924 and 1925 there are 410 member banks in the Boston district for each of which ratios of gross earnings, of total expense, and of net earnings® to earning assets are avail- able. The respective types of ratios differ from bank to bank and from year to year. We have already noted the extent of the variations in the gross earnings ratios, and shall later pre- sent those for the other series. Moreover, the ratios vary accord- ing to the size of the cities in which the banks are located and the volume of the banks’ earning assets. The problem by which we are confronted, therefore, in determining the relations 9 408 showing positive net earnings in both years.

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