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Number of National Banks, Their Capital, Surplus, Dividends, Net Addition to Profits, and Ratios, Years Ended June 30,

1914 to 1921.

From the Report of the Comptroller of the Currency for 1921, p. 58. [In thousands of dollars.]

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Earnings, Expenses, and Dividends of National Banks by Federal Reserve Districts, Year Ended June 30, 1921. From the Report of the Comptroller of the Currency for 1921, p. 56.

[In thousands of dollars.]

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Suggested Readings on Chapter IX.

Langston, L. H.-Practical Bank Operation.

Willis, H. P., and Edwards, G. W.-Banking and Business, Chapters IX, X, and XIII.

I.

Questions and Problems on Chapter IX.

Which officer of a bank would you prefer to be? Consider salary, responsibility, and pleasantness of occupation.

2. If you were a bank manager, where would you place a gruff man? A good mixer? A good detail man? A fast money counter? A very honest man?

3. Make an organization chart of a bank. Draw lines indicating the simple operations such as depositing money, cashing a check, getting a loan, and buying a draft.

4. Why do banks often give their employees bonuses? Is the policy wise?

5. Why do banks often provide lunch for their employees? 6. What would be the ideal portfolio for a bank?

7. How much of its assets can a bank afford to tie up in non-liquid investments?

8. Is it wise for a bank to put up a building for its own. exclusive use? To put up a big office building and rent part of it?

9. How can a bank get new depositors?

10. Why do most banks grow through amalgamations instead of by getting new business?

II.

12.

What should be the character of bank advertising?

How can a banker arrange his portfolio so he need never worry about reserves?

13. Suggest the problems of the banker at each stage of the business cycle.

14. Suppose it is summer-time in an agricultural region. A bank has loaned all that its customers desire and has $100,000 surplus funds. How should it invest it? Suppose it is a New York bank and the time is January 30. How should it invest it?

15. In a period of rapid expansion of business, does the individual banker need to consider the credit situation except as it affects the ability of his borrowers to meet their obligations? What would be the effect if the banker restricted his loans?

16. List the investments of national banks according to the amounts held. Does the banking correspond to their merits. as investments?

17.

What effect did the war have on earnings and dividends of the banks?

18. Do banks earn more in periods of prosperity or of depression?

19. How do the earnings of banks compare with those in other lines of business?

20.

In which Federal reserve district was the ratio of earnings to capital and surplus highest?

21. Figure the percentage of gross earnings taken by expenses. How does this compare with other businesses?

22.

How does the percentage of losses on loans and discounts of the banks compare with the credit losses of mercantile firms?

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