72
BANKING STANDARDS
2. THE RELATION OF GROSS EARNINGS TO EARNING ASSETS
For the combined twelve districts for the years 1919-1925, inclusive,
gross earnings constituted 6.58% of earning assets. The
lowest ratio for the combined districts was 6.00% for 1919; the
highest, 7.33% for 1921. For the combined years, the lowest
ratio, 6.08, is that for Boston; the highest, 7.92, for Dallas. Differences
characterize the respective years and districts, as shown
in Table 50, the ratios ranging from 5.44 to 8.85.
TABLE 50
RATIOS OF GROSS EARNINGS To EARNING ASSETS IN ALL MEMBER
Banks, FEDERAL RESERVE SYSTEM, BY YEARS AND
BY FEDERAL RESERVE DISTRICTS
FEDERAL RESERVE DisTrICTS
Boston........ Chee
New York... ve
Philadelphia. . ae
Cleveland... . ‘e
Richmond. . . ve
Atlanta....... .
Chicago....... .
“t. Louis. ...... is us
Vinneapolis........o.00entn
Tansas City..... ......-..
Dallas. .........coviivinnnn
San Francisco. .........
Average
(All Districts)
\verag
1010- |
1925)
Ta op £7 nt FAPNINGS TO FTARNING ASSETS :
1021 | 1922 | 1923 | 1024 i 1025
6.58' 6.00! 6.451 7.33} 6.971 6.421 6.501 6.37
an
+e
3.6
Lag
L wn
ras
re
e-(
Lek
6.3:
re.
Is
pe
ra
ay
04
L.49
90
¢.08
6.12
3.53
ol
”
o
LC.aY
6.30
6.67
6.44
7.27
Su
6.5
6.78
"49
“na
7.0rI
6.058
£.89
6.21
6.77
6.45
7.12
6.2
6.50
6.52
7.40
| 7.86
6.97
).04A
If the period 1919-1925 is taken as a unit and if the gross
earnings ratios by years and by districts are classified in frequency
form, as is done in Chart 15, it is found that the common
or modal amounts fall in the group 6.25-6.75, and that the form
of the distribution approaches the normal type. Inspection of
Table 50, however; shows a correlation between the location of the
districts and the ratios of gross earnings. Accordingly, when the
ratios for the different years and districts are grouped, as in Chart
15, the eastern districts, generally, fall in the lower, and the western
in the higher groups. Account is taken of this fact in the
following analysis.
If the average ratio in each district for the combined years
1919-1923, inclusive, is taken as a standard from which to determine
the dispersion of the ratios each year, it is found from
