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SEPTEMBER 30, 1906.

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The number of active national banks and their aggregate authorized capital, bonds on deposit, and circulation outstanding secured by bonds and lawful money on March 14, 1900, and September 30, 1906, together with the increase, appear in the table following:

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From the foregoing it will be noted that the net increase in number and capital of banks during the period in question was 2,572 and $225,556,680, respectively, and also that circulation outstanding, covered by bonds and deposits of lawful money, increased to the extent of $319,500,378. National-bank circulation forms approximately 18 per cent of the circulating medium of the country.

The following table is of interest as indicating the number of national banks in active operation at the close of each month from October 31, 1905, to September 30, 1906; their authorized capital stock, bonds on deposit to secure circulation, circulation secured by bonds and by lawful money, and the average monthly market price of 2 per cent consols:


Number of banks.


Bonds on


Circulation secured by-- Total cirmonthly

culation price of

Lawful outstandbonds. Bonds.

money. ing.

October 31
November 30..
December 31..

January 31...
February 28..
March 31.
April 30..
May 31
June 30.
July 31.
August 31.
September 30..

5 858 $812,026,075 $494,017,850 3103.5120 $189, 937, 806 3:34, 470, 443 $5:24, 108.219 5,868 815, 3:26,075 500,269, 410 103.3774 497,616, 304 35,712,954 533, 329,258 5, 898 818, 182, 075 506,689, 990 103.5050 504,812, 313 36,072, 034 510,914, 317

1 5,935 822,022, 075 509,901, 690 103.1875 506, 365, 719 36, 861,331 543, 230,080 5. 963 821.610,275 511, 46, 440 103.3210 509, 173,566 41.630,329 550,803, 895 5,999 826,055, 275 514,362, 990 104. 2593 51:2,1,551 42, 445, 416 551, 666, 967 6,032 827, 925,275 516, 337, 410 103.9150 514. 123,519 42, 2.703 556, 646,28 6,069 830, 163, 775 519, 265,530 103.6.23 516, 036, 146 43,093,514 059, 129, 660 6,107 833, 073, 775 520, 605,210 103. 9327 517,847,719 43,264.611 561, 112, 300 6, 1:32 836, 7:29, 775 5:20,348, 610 104.0350 516,573,399 44,907,646 561, 481,015 6,162 839,804,775 526, 944,030) 105. 0009 5:24, 139, 160 45, 113, 113 569, 2.303 6, 189

841, 864, 775 530,772, 270 105.5078 5:27, 768, 924 46,134, 184 573, 903, 108

Condition of national banks.

The latest returns of national banks, made to the Comptroller of the Currency, exhibit conditions on September 4, 1906, on which date there were in operation 6,137 associations with paid-in capital stock of $835,066,796, and surplus and other profits of $670,814,981. The surplus proper was $490,245,124, which is nearly three times the amount required to be accumulated and maintained under the law. The surplus and “other undivided profits” amount to over 80 per cent of the paid-in capital.

Of the total liabilities of the banks, namely, $8,016,021,066, over one-half, or $4,199,938,310, is represented by individual deposits. The deposits to the credit of banks amounted to $1,589,001,462, and to the credit of the United States and disbursing officers of the Government $107,831,814.

The principal items of resources of the banks were as follows: Loans and discounts, $1,298,983,316; United States bonds, $628,796,710; other bonds and securities, $701,240,755; specie, $164,437,291 (of which $363,840,256 represents gold and gold certificates), and legal tenders $161,575,120.

Since August 25, 1905, the date of approximately corresponding returns, there is shown to have been an increase of 380 in number of reporting banks, $35,196,567 in capital stock and $50,521,024 in surplus and undivided profits. There was an increase of $379,256,597 in individual deposits and $45,741,514 in Government deposits. The amount to the credit of other banks decreased $35,876,120. The deposits on which reserve was required amounted to $4,927,865,452, on which a reserve of 20.70 per cent was held on September 4, 1906. The cash on hand, the redemption fund, and the net amount due from reserve agents equaled 25.72 per cent of deposit liabilities. On August 25, 1905, the deposit liabilities were $4,735,477,535; the lawful reserve, 21.69 per cent, but including the net amount due from reserve agents, with cash and the redemption fund, a reserve was held of 27.33 per cent. Compared with August 25, 1905, the September 4, 1906, reports show an increase of $300,474,163 in loans and discounts and $77,315,040 in Government bonds, but a reduction in specie and legal tenders of $31,042,162 and $8,498,727, respectively.


The domestic coinage of the mints during the fiscal year amounted to 167,371,035 pieces, of the value of $60,216,747.90.

Of this, $53,002,097.50 was gold coin, $4,016,368.10 was subsidiary silver coin, and $3,198,282.30 was minor coin. No silver dollars were coined, all bullion purchased for that purpose being exhausted. The mint at Philadelphia also coined 1,000,000 ten-peso pieces and 3,000,000 five-peso pieces, of the value in United States money of

$12,461,240.32, for the Mexican Government; 700,000 fractional silver pieces for the Government of Costa Rica; 1,000,000 half-balboa pieces for the Government of Panama, and 1,557,629 pesos and 3,765 pieces in fractional silver coins for the Goverment of the Philippine Islands.

The new mint at Denver has been in operation since February 1, 1906. The demands on all the mints are growing every year with the enlargement of the gold supply and the rapidly increasing need for the subsidiary silver and minor coins. There are indications that the cessation of coinage of the silver dollar will cause an enlarged use of the half dollar.

For many years, until the last year, it has been the practice to buy the nickel and bronze blanks for the minor coins from contractors, but these blanks are now made at the mints from pig metal, and with economy to the Government. In this connection, it is gratifying to state that the representatives of the mint services of foreign governments are of late years frequent visitors at the United States mints, and that numerous devices and methods originated in the latter have been adopted elsewhere. The new mint structures at Philadelphia and Denver are the most beautiful buildings designed for coinage purposes in the world, and the mechanical equipment and processes are of the most approved and modern type.

Renewal of silver purchases. In my report of last year attention was called to the fact that bullion must be had at an early day for the subsidiary coinage, and authority was asked for the recoinage of abraded silver dollars into fractional denominations. No action having been taken upon this recommendation, or to provide by other means the supply of metal required, purchases of silver bullion have been resumed under section 3526, Revised Statutes, the Attorney-General having given a written opinion to the effect that authority for purchases existed under this statute, and that the demand for these coins might be supplied without limit. On the basis of the coinage of the last five years, approximately 5,000,000 ounces of silver will be required annually for subsidiary coinage, and with the growth of population and business this amount will be exceeded.

I repeat my recommendation of a year ago that section 3527, Revised Statutes, be amended by striking out the provision which requires silver coins to be paid out at the mints and at the assay office at New York. The issue and redemption of these coins should be through the Treasury and subtreasuries. The mints should pay out coins only on orders from the Treasurer. The effect of the law as it stands is to create a demand on the mints for perfectly new coin, although there may be already an abundance of coin in good condition in the Treasury.

Assay office in New York.

Congress at its last session having made appropriations of $370,000 for repairs to the assay office, steps have been taken to have the building put into safe and serviceable condition. When this is done the institution will be completely equipped with an electrolytic refinery, which will put an end to the acid fumes which at times have been troublesome in the neighborhood.

Production and deposits of gold. The production of gold in the United States for the calendar year 1905 is estimated at $88,180,700, and the industrial consumption at $33,208,615, of which $27,621,979 was of new material. The original deposits of gold at the several mints and assay offices aggregated $153,109,493.52.

Earnings and expenditures.

The earnings and gains of the Mint Service during the fiscal year 1906 were as follows: Parting and refining charges...

$233, 860.99 Alloy charges.

14,198.03 Melting, assaying, and stamping charges

28,798.38 Seigniorage on subsidiary silver coin,

507, 761.94 Seigniorage on minor coin..

2,738, 324.26 Profits on manufacture of proof coins and medals.

1,696.98 Charges received for mounting medals ...

146. 14 Gains on bullion deposits....

49, 113. 60 Proceeds from sale of old material.

3,425.62 Received for special assays

3, 735.00 Sale of by-products..

21,384.94 Received for manufacturing appliances for Government institutions. 18, 843.26 Received for coinage for foreign countries...

70, 676.00 Received for coinage for Philippine government

15, 962. 33 Total earnings and gains.

3,707,927.47 The expenditures were as follows: Equipment, Philadelphia mint..

$13, 322.60 Equipment, Denver mint..

131, 130.61 Transfer of gold coin and bullion between mints and assay offices.

60, 848. 71 Paid in salaries and wages....

1,060, 799.24 Contingent expenses (less wastage and loss in sweeps sold).

444, 588.50 Wastage and loss on sweeps..

27,383.97 Expense of distributing minor coin.

35, 609.28 Loss on recoinage, minor coin ...

10, 270.97 Charges paid for mounting medals.

146.14 Total expenditures and loss..

1,784, 100.02


The outstanding principal of the public debt June 30, 1906, was $895,159,140, an increase of $800 in the fiscal year, due to the issue of 4 per cent bonds of the funded loan of 1907 in settlement of accrued interest on 4 per cent refunding certificates surrendered during the year under the act of February 26, 1879.

The refunding operations described in the last annual report, which were begun October, 1905, were terminated November 29 following. The amount of 2 per cent consols of 1930 issued in exchange for 3 per cent bonds of 1908-1918 and 4 per cent bonds of 1907 was $53,032, 100.

On July 2, 1906, the Department invited proposals for $30,000,000 2 per cent bonds, the proceeds to be used in the construction of the Panaina Canal. The call for bids was in the following terms:

The Secretary of the Treasury offers to the public $30,000,000 of the bonds of the Panama Canal loan, authorized by section 8 of the act approved June 28, 1902, and supplemented by section 1 of the act of December 21, 1905.

The bonds will bear interest at the rate of 2 per cent per annum; will be dated August 1, 1906, and the interest will be paid quarterly on the first days of November, February, May, and August. They will be issued in denominations of $20, $100, and $1,000 of coupon bonds, and of $20, $100, $1,000, and $10,000 of registered bonds. They will be redeemable in United States gold coin, at the pleasure of the United States, after ten years from the date of their issue, and will be payable thirty years from such date. They will be exempt from all taxes or duties of the United States, as well as from taxation in any form by or under State, municipal, or local authority. They will be available to national banks as security for circulating notes upon the same terms as the 2 per cent consols of 1930, to wit: The semiannual tax upon circulating notes based upon the said bonds as security will be one-fourth of one per cent. They will be receivable, like all other United States bonds, as security for public deposits in national banks.

The law forbids their sale at less than par and provides that all citizens of the United States shall have equal opportunity to subscribe therefor.

In pursuance of the above announcement, the Secretary invites bids for the bonds heretofore described, which must be submitted to this Department on or before the 20th of July, 1906. Each bid should state the amount of bonds desired by the subscriber, whether coupon or registered, the price he is willing to pay, and the place where he desires to make payment-whether at the Treasury of the United States or at the office of some one of the Assistant Treasurers at New York, Baltimore, Philadelphia, Boston, Chicago, St. Louis, Cincinnati, New Orleans, or San Francisco. All bids should be addressed to the Secretary of the Treasury, Division of Loans and Currency, and the envelopes inclosing them should be plainly marked " Bids for Panama Canal Bonds."

Upon receipt and classification of the bids hereby invited, the successful bidders will be advised of the acceptance of their bids, and they will be instructed as to the date upon which payment is desired to be made at the Treasury or some subtreasury of the United States.

In considering bids, the bidders offering the highest prices will receive the first allotment. Of two or more bidders offering the same price, those asking for the smaller amounts of bonds will receive priority in allotment. The Department reserves the right to permit bidders offering the highest prices to increase the amount of their purchases.

The Department also reserves the right to reject any or all bids, if deemed to be to the interests of the United States so to do.

The bonds will be ready for delivery about August 1, 1906.

Prospective bidders desiring information not contained in this circular may address the Secretary of the Treasury, Division of Loans and Currency, Washington, D. C., the Assistant Treasurers at Chicago, St. Louis, New Orleans, or San Francisco.

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