Word: bank
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Dates: during 1960-1969
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...bothered even more. Most disturbing of all, Treasury Secretary David Kennedy put on yet another inexpert performance. At the beginning of the week, he and Federal Reserve Chairman William McChesney Martin met with 24 top bankers and, much to the disappointment of investors, failed to win any promise that bank interest rates will not be raised still higher. The next day Kennedy told the Senate Finance Committee that if Congress failed to extend the surtax, the Administration "may want to go into controls" on wages and prices...
...Chrysler and news that retail sales dropped in June for the second straight month. These indicators might bring some cheer to the Federal Reserve Board, which has been desperately looking for evidence that its restrictive money policy has produced some slowdown. But New York's First National City Bank warned in its latest economic letter that, "to hold fast to a restrictive policy until the signs of an economic downturn are unmistakable means that the policy will have gone too far." Reason: economic indicators do not clearly signal a recession until after it has begun...
Maybe so, but those sins are yielding notably handsome wages for banks. Reports last week of banks' first-half earnings emphasize that, whatever else they accomplish, high interest rates produce high profits. Compared with the first half of 1968, net operating earnings at Manhattan's Manufacturers Hanover Corp., parent of the fourth biggest bank in the nation, rose 21% to $40 million...
Operating earnings climbed 13% at BankAmerica Corp. (the Bank of America), 11% at Chemical New York and J. P. Morgan & Co. and 10% at Chase Manhattan and Chicago's Continental Illinois-the Treasury Secretary's old bank. More modest increases were posted by First National City (6%) and Bankers Trust (2%). Some of the smaller banks really soared. Manhattan's Marine Midland Grace increased earnings by 31% to $7.2 million...
Bankers 'are quick to say that the net operating earnings they report are not quite the same as ordinary corporate earnings. "N.O.E." include profits from lending but do not include defaulted loans or losses on securities investments, which most banks have suffered this year. Under any circumstances, N.O.E. figures are somewhat misleading; they tend to overstate profits during times when securities markets are falling-and understate profits when markets are rising. As a result, accounting groups are urging banks to report straight net income as corporations do. Whether they do or not, bank operating earnings are likely to remain...