XVI 
NORMS, TRENDS, AND CORRELATIONS IN TOTAL 
EXPENSE RATIOS 
[. INTRODUCTION 
IN this chapter an analysis is made of the ratios of total 
expense to earning assets for the member banks in the First 
and Second Federal Reserve districts. The data from the First 
district cover the entire membership, bank by bank, for the 
years 1922-19235, inclusive; those for the Second district relate 
to a sample of 280 individual banks for the years 1923-1923, 
inclusive.! Both sets of data were reported in the form of 
ratios, the amounts each year, together with other relevant data 
for the same institution, being separately distinguished. 
2. NORMS AND TRENDS IN TOTAL EXPENSE RATIOS 
(1) Member Banks in District 1—Boston 
The average ratios? of total expense to earning assets for the 
member banks in District 1, classified by years and by size of 
city in which located are shown in Table 161. The lowest ratio 
for the entire district is 4.07, in 1922, and the highest, 4.23, in 
1925. For banks in the several groups of cities, the ratios tend 
to increase in amount as the cities increase in size until the popu- 
lation reaches 120,000. In this group the ratios are somewhat 
lower each year than are those for banks located in cities with 
population of 40,000 to 120,000. This table shows that the 
average ratios vary according to years and to the population of 
the city in which the banks are located. 
An alternative method of presenting the data is illustrated in 
Table 162, the bases of classifying the banks being years and 
volume of earning assets. The table shows that, except for two 
1 Except for certain substitutions; see page 299. 
* Obtained by adding the ratios and dividing by the number of banks.