Thesis

Independent State Banks in California, 1945-1964

A study was undertaken as a part of a larger, more detailed dissertation of the development of the Independent State Banks in California from 1945-1964. The primary source of information for such a study is the Annual Report by the Superintendent of Banks, State of California for each of the years covered. Information was put in a computer-readable form, a program was written, and the General Electric "420" Computer was used to compile and compute various totals and ratios for approximately 125,000 separate entries. The resulting output was used to study the development of the State Chartered Banks over the twenty-year period. The first area covered was the change in Capital Funds in the total system. State Banks showed a growing position in California banking, expanding to 33% of Total Capital of all banks in the state by 1964. The growth followed the same pattern for Total Resources, increasing from less than 20% in 1945 to over 32% in 1964. The great majority of both Capital and Resources was concentrated in a very few banks. Almost 80% of Capital and Resources were found in less than 8% of all the State Chartered Banks. The mix of deposits showed an aggressive shift from Demand Deposits to Time Deposits, with variations emerging in the three size-groups. The Capital Ratios (general measures of bank liquidity and safety) showed steady improvement for all groups over the twenty years. Allocation of Resources followed a general pattern of seeking the higher returns available, with interesting variations among the three groups. The examination of new banks being formed and others becoming extinct showed some interesting trends of small and medium-sized banks being formed, growing, and merging with other banks. Many areas were touched upon and questions raised to be answered in further studies that are recommended in the closing chapter of this thesis.

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