Annual Report of the Federal Reserve Board, 2024

REPORT TO CONGRESS 111th Annual Report of the Board of Governors of the Federal Reserve System 2024 BOARD OF GOVERNORS OF THE FEDERAL RESERVE SYSTEM

i Contents About the Federal Reserve ...........................................................................................iii 1 Overview .......................................................................................................................1 2 Monetary Policy and Economic Developments .....................................................3 February 2025 Summary ...................................................................................................3 July 2024 Summary ..........................................................................................................9 3 Financial Stability .....................................................................................................15 Monitoring Financial Vulnerabilities ..................................................................................16 Financial Stability Cooperation and Coordination ...............................................................21 4 Supervision and Regulation ....................................................................................23 Supervised and Regulated Institutions .............................................................................24 Supervisory Developments ..............................................................................................27 Regulatory Developments ................................................................................................37 5 Payment System and Reserve Bank Oversight ...................................................47 Payment Services to Depository and Other Institutions ......................................................48 Currency and Coin ..........................................................................................................54 Fiscal Agency and Government Depository Services ..........................................................57 Evolutions and Improvements to the System .....................................................................60 Oversight of Federal Reserve Banks .................................................................................63 Pro Forma Financial Statements for Federal Reserve Priced Services .................................69 6 Consumer and Community Affairs .........................................................................75 Consumer Compliance Supervision ..................................................................................75 Consumer Laws and Regulations .....................................................................................87 Consumer Research and Analysis of Emerging Issues and Policy ........................................89 Community Development .................................................................................................92 Appendixes A Federal Reserve System Organization ..................................................................95 Board of Governors .........................................................................................................95 Federal Open Market Committee ....................................................................................103 Board of Governors Advisory Councils ............................................................................105 Federal Reserve Banks and Branches ............................................................................110 B Minutes of Federal Open Market Committee Meetings ..................................133 Meeting Minutes ..........................................................................................................133 C Federal Reserve System Audits ...........................................................................135 Office of Inspector General Activities ..............................................................................135 Government Accountability Office Reviews ......................................................................137 D Federal Reserve System Budgets .......................................................................139 System Budgets Overview .............................................................................................139

ii 111th Annual Report | 2024 Board of Governors Budgets ..........................................................................................143 Federal Reserve Banks Budgets ....................................................................................150 Currency Budget ...........................................................................................................156 E Record of Policy Actions of the Board of Governors ........................................163 Rules and Regulations ..................................................................................................163 Policy Statements and Other Actions ..............................................................................164 Discount Rates for Depository Institutions in 2024 .........................................................167 The Board of Governors and the Government Performance and Results Act .......................169 F Litigation ..................................................................................................................171 Pending .......................................................................................................................171 Resolved ......................................................................................................................172 G Statistical Tables ....................................................................................................175

iii About the Federal Reserve The Federal Reserve was created by an act of Congress on December 23, 1913, to provide the nation with a safer, more flexible, and more stable monetary and financial system. In establishing the Federal Reserve System, the United States was divided geographically into 12 Districts, each with a separately incorporated Reserve Bank. For more information about the Federal Reserve Board and the Federal Reserve System, visit the Board’s website at https://www.federalreserve.gov/aboutthefed/default.htm. Online versions of the Board’s annual report are available at https://www.federalreserve.gov/publications/annualreport/default.htm.

1 1 Overview This report covers the calendar-year 2024 operations and activities of the Federal Reserve, the central bank of the United States (see figure 1.1), categorized in the five key functional areas: • Conducting monetary policy and monitoring economic developments. Section 2 provides adapted versions of the Board’s semiannual Monetary Policy Reports to Congress. • Promoting financial system stability. Section 3 reviews Board and System activities and research undertaken to foster a resilient and stable financial system. • Supervising and regulating financial institutions and their activities. Section 4 summarizes the Board’s efforts related to financial institution oversight and examinations, supervisory policymaking, and regulatory activities and enforcement. • Fostering payment and settlement system safety and efficiency. Section 5 describes actions by the Board and Reserve Banks to promote the effectiveness of the nation’s payment systems, discusses initiatives to promote payment system safety, and provides data on Reserve Bank services and income. • Promoting consumer protection and community development. Section 6 provides information on the Board’s efforts to promote a fair and transparent financial services market for Figure 1.1. The Federal Reserve System’s unique structure ensures broad perspective The Federal Reserve System consists of 12 Reserve Banks located in major cities throughout the United States, along with a seven-member Board of Governors headquartered in Washington, D.C. See “Federal Reserve System Organization” in appendix A for more information on the Board and System leadership. 1 9 2 Minneapolis Boston 12 7 3 New York 10 Philadelphia Chicago Cleveland San Francisco 4 Washington, D.C. Kansas City (Board of Governors) St. Louis Richmond 8 5 6 11 Atlanta Dallas Alaska Hawaii Puerto Rico Guam Virgin Islands

2 111th Annual Report | 2024 consumers, protect consumer rights, and ensure that Board policies and research take consumer and community perspectives into account. Additional information for calendar-year 2024 on Federal Reserve leadership, policy actions, budgets as well as historical data and supporting activities can be found in the appendixes: • Appendix A lists key officials across the Federal Reserve System • Appendix B provides links to the minutes for each of the eight regularly scheduled meetings of the Federal Open Market Committee • Appendix C contains information on the Federal Reserve’s audited financial statements as well as reviews conducted by the Office of Inspector General and the Government Accountability Office • Appendix D presents information on the budgets for the Board and Reserve Banks and on currency-related costs • Appendix E summarizes policy actions of the Board of Governors • Appendix F lists litigation, both pending and resolved, that the Board of Governors was a party in • Appendix G includes statistical tables that provide updated historical data concerning Board and System operations and activities

3 2 Monetary Policy and Economic Developments The Federal Reserve conducts the nation’s monetary policy to promote maximum employment, stable prices, and moderate long-term interest rates in the U.S. economy. This section reviews U.S. monetary policy and economic developments in 2024, with excerpts and select figures from the Monetary Policy Reportpublished in February 2025 and July 2024.1The report, submitted semiannually to Congress, is delivered concurrently with testimony from the Federal Reserve Board Chair.2 February 2025 Summary Inflation moderated a little further last year after having slowed notably in 2023, but it remains somewhat above the Federal Open Market Committee’s (FOMC) objective of 2 percent. The labor market appears to have stabilized following a period of easing, with the unemployment rate flattening out at a relatively low level over the second half of last year. Real gross domestic product (GDP) increased solidly last year, supported by strength in consumer spending. As labor market tightness continued to ease and inflation moderated a bit further, the FOMC lowered the target range for the policy rate by a cumulative 100 basis points over its September, November, and December meetings, bringing it to the current range of 4¼ to 4½ percent. The Federal Reserve has also continued to reduce its holdings of Treasury and agency mortgagebacked securities. The FOMC is strongly committed to supporting maximum employment and returning inflation to its 2 percent objective, and it remains attentive to the risks to both sides of its dual mandate. In considering the extent and timing of additional adjustments to the target range for the federal funds rate, the Committee will carefully assess incoming data, the evolving outlook, and the balance of risks. Recent Economic and Financial Developments Inflation.After stepping down notably in 2023, consumer price inflation eased a bit more last year, although recent progress has been bumpy and inflation remains somewhat above 2 percent. The price index for personal consumption expenditures (PCE) rose 2.6 percent over the 12 months ending in December, down from a peak of 7.2 percent in 2022 (figure 2.1). The core PCE price 1 Those complete reports are available on the Board’s website at https://www.federalreserve.gov/publications/files/ 20250207_mprfullreport.pdf (February 2025) and https://www.federalreserve.gov/monetarypolicy/files/ 20240705_mprfullreport.pdf (July 2024). 2 As required by section 2B of the Federal Reserve Act, the Federal Reserve Board submits written reports to Congress that contain discussions of “the conduct of monetary policy and economic developments and prospects for the future.”

4 111th Annual Report | 2024 Figure 2.1. Personal consumption expenditures price indexes Percent change from year earlier 8 Monthly 7 Trimmed mean 6 Total Excluding food and energy 5 4 3 2 1 0 2017 2018 2019 2020 2021 2022 2023 2024 Note: The horizontal line indicates the Federal Open Market Committee’s objective of 2 percent. The data extend through December 2024. Source: For trimmed mean, Federal Reserve Bank of Dallas; for all else, Bureau of Economic Analysis; all via Haver Analytics. index—which excludes often-volatile food and energy prices and is generally considered a better guide to the future of inflation—rose 2.8 percent last year, only a little less than its increase in 2023, as core services price inflation remained elevated. However, some other approaches to removing the influence of volatile components of inflation, such as the trimmed mean PCE measure produced by the Federal Reserve Bank of Dallas, showed more marked deceleration in prices last year. Measures of longer-term inflation expectations are within the range of values seen in the decade before the pandemic and continue to be broadly consistent with the FOMC’s longer-run objective of 2 percent inflation. The labor market. The labor market remains Figure 2.2. Nonfarm payroll employment solid and appears to have stabilized after a period of easing (figure 2.2). The unemploy- Thousands of jobs ment rate moved up over the first half of last 900 Monthly 800 year but was mostly flat thereafter, ending the 700 year at 4.1 percent—still low by historical 600 500 standards—while job vacancies, which had 400 been trending down, also flattened out over 300 the second half at a solid level (figure 2.3). As 200 100 labor demand cooled somewhat further last 0 2021 2022 2023 2024 year, monthly job gains slowed to a moderate pace on average. Labor supply likely increased Note: The data shown are a 3-month moving average of the change in nonfarm payroll employment and less robustly than in previous years, with extend through December 2024. immigration appearing to have slowed over the Source: Bureau of Labor Statistics via Haver Analytics. second half of last year. Given the further

Monetary Policy and Economic Developments 5 Figure 2.3. Unemployment rate, by race and ethnicity Percent 20 Monthly 18 Black or African American Hispanic or Latino 16 White 14 Asian 12 10 8 6 4 2 0 2006 2008 2010 2012 2014 2016 2018 2020 2022 2024 Note: All data displayed are 3-month moving averages. Unemployment rate measures total unemployed as a percentage of the labor force. Persons whose ethnicity is identified as Hispanic or Latino may be of any race. Small sample sizes preclude reliable estimates for Native Americans and other groups for which monthly data are not reported by the Bureau of Labor Statistics. The data extend through December 2024. Source: Bureau of Labor Statistics via Haver Analytics. rebalancing of labor demand and supply last year, the labor market no longer appears especially tight. Reflecting this further balancing, nominal wage gains continued to slow in 2024 and are now closer to the pace consistent with 2 percent inflation over the longer term. Economic activity. Real GDP is reported to have increased last year by 2.5 percent, a little slower than in 2023. Consumer spending continued to grow robustly, supported by a solid labor market and rising real wages, while real business fixed investment increased moderately. In the housing market, new home construction was solid but existing home sales remained depressed, with mortgage rates still elevated. In contrast to GDP, manufacturing output was little changed, in part reflecting weak production in interest-sensitive sectors. Financial conditions.Financial conditions continue to appear to be somewhat restrictive on balance. Short-term Treasury yields declined, in line with the easing of monetary policy since September; however, the market-implied path for the federal funds rate over the next year shifted up notably, and long-term Treasury yields increased markedly in the fourth quarter. Broad equity prices continued to increase despite the rise in longer-term Treasury yields, and yields on corporate bonds were little changed, as spreads narrowed. Credit continued to be broadly available to large-to-midsize businesses, most households, and municipalities but remained relatively tight for small businesses and households with lower credit scores. Bank lending to households and businesses continued to decelerate in the second half of 2024, likely reflecting still-elevated interest rates and tight lending standards. Financial stability.The financial system remains sound and resilient. Valuations remained high relative to fundamentals in a range of markets, including those for equity, corporate debt, and

6 111th Annual Report | 2024 residential real estate. Total debt of households and nonfinancial businesses as a fraction of GDP continued to trend down to a level that is very low relative to that in the past two decades. Most banks continued to report capital levels well above regulatory requirements and have reduced their reliance on uninsured deposits, but fair value losses on fixed-rate assets were still sizable for some banks. In terms of funding risks, while the 2023–24 Securities and Exchange Commission reforms on money market funds (MMFs) have partially mitigated vulnerabilities of prime MMFs, other less regulated short-term investment vehicles remain vulnerable and somewhat opaque, and their assets have been growing. Meanwhile, hedge fund leverage appears to be high and concentrated. (See the box “Developments Related to Financial Stability” on pages 32–33 of the February 2025 Monetary Policy Report.) International developments.Foreign growth remained modest in the second half of 2024. Foreign manufacturing in general was weak, as the cumulative effects of restrictive monetary policy weighed on the sector and, in Europe, energy-intensive industries continued to grapple with elevated energy costs. That said, high-tech manufacturing and exports remained strong in Asia on robust U.S. artificial intelligence (AI) and data center demand. In China, while exports were strong, domestic demand remained sluggish despite stimulus measures to shore up the ailing property sector. Meanwhile, foreign headline inflation continued to decline, but progress on inflation reduction was uneven across economies. Many foreign central banks cut policy rates further since mid-2024, citing declining inflationary pressures, easing labor markets, and concerns about economic growth. Policymakers generally stressed the importance of maintaining vigilance amid persistent geopolitical risks and, in some economies, still-somewhat-elevated services inflation and wage pressures. Since mid-2024, the trade-weighted exchange value of the U.S. dollar has increased significantly, on net, reflecting widening gaps of U.S. interest rates over those of major advanced foreign economies, the relative strength of the U.S. economy, and political and fiscal developments in some foreign economies. Monetary Policy Interest rate policy.After having held the target range for the policy rate at 5¼ to 5½ percent between late July 2023 and mid-September 2024, the FOMC lowered the target range for the policy rate by a cumulative 100 basis points over its September, November, and December meetings, bringing it to the current range of 4¼ to 4½ percent (figure 2.4). The FOMC’s decision to begin reducing the degree of policy restraint reflected the FOMC’s greater confidence in inflation moving sustainably toward 2 percent and the judgment that it was appropriate to recalibrate the policy stance. The FOMC remains attentive to the risks to both sides of its dual mandate. In considering the extent and timing of additional adjustments to the target range for the federal funds rate, the Committee will carefully assess incoming data, the evolving outlook, and the balance of risks.

Monetary Policy and Economic Developments 7 Figure 2.4. Selected interest rates Percent 6 Daily Target federal funds rate 5 10-year Treasury rate 2-year Treasury rate 4 3 2 1 0 2009 2011 2013 2015 2017 2019 2021 2023 2025 Note: The 2-year and 10-year Treasury rates are the constant-maturity yields based on the most actively traded securities. The data extend through February 4, 2025. Source: Department of the Treasury; Federal Reserve Board. Balance sheet policy.The Federal Reserve has continued the process of significantly reducing its holdings of Treasury and agency securities in a predictable manner. Beginning in June 2022, principal payments from securities held in the System Open Market Account have been reinvested only to the extent that they exceeded monthly caps. Under this policy, the Federal Reserve has reduced its securities holdings by $297 billion since June 2024, bringing the total reduction in securities holdings since the start of balance sheet reduction to about $2 trillion. The FOMC has stated that it intends to maintain securities holdings at amounts consistent with implementing monetary policy efficiently and effectively in its ample-reserves regime. To ensure a smooth transition, the FOMC slowed the pace of decline of its securities holdings in June 2024 and intends to stop reductions in its securities holdings when reserve balances are somewhat above the level that the FOMC judges to be consistent with ample reserves. Special Topics Employment and earnings across groups.The tight labor market in recent years has been beneficial across all demographics of workers, and many of the disparities in employment and wages by sex, race, ethnicity, education, and geography have narrowed. Over the past year, even as labor market conditions have eased, employment disparities continue to be near their recent lows, while wage growth has remained solid across many groups despite slowing a bit from post-pandemic highs. Even so, in absolute levels, significant disparities in groups remain. (See the box “Employment and Earnings across Demographic Groups” on pages 11–14 of the February 2025 Monetary Policy Report.)

8 111th Annual Report | 2024 Strong productivity growth.Labor productivity in the business sector increased 1.8 percent per year, on average, since the fourth quarter of 2019, stronger than its 1.5 percent average annual pace over the previous expansion. Should this faster pace of productivity growth persist, it can support stronger GDP growth without adding inflationary pressure. Some factors that have boosted productivity growth recently may continue providing support, such as new business formation, which surged early into the pandemic and has remained strong. Other factors may have had more short-lived influences on productivity growth, including a temporary burst in worker reallocation across jobs earlier in the pandemic. Any measured productivity gains from integration of AI technologies into production processes have likely been small so far, but productivity gains may grow as AI use becomes more widespread. (See the box “Labor Productivity since the Start of the Pandemic” on pages 18–20 of the February 2025 Monetary Policy Report.) Federal Reserve’s balance sheet and money markets.The size of the Federal Reserve’s balance sheet has declined since June as the FOMC has continued to reduce its securities holdings. Usage of the overnight reverse repurchase agreement facility decreased further, while reserve balances were little changed. Conditions in money markets remained stable. (See the box “Developments in the Federal Reserve’s Balance Sheet and Money Markets” on pages 42–44 of the February 2025 Monetary Policy Report.) Framework review.The Federal Reserve has begun its periodic public review of the monetary policy framework it uses to pursue its dual-mandate goals of maximum employment and price stability. The review is focused on the FOMC’s Statement on Longer-Run Goals and Monetary Policy Strategy, which articulates the Committee’s approach to monetary policy, and the Committee’s policy communications tools. Like the Federal Reserve’s 2019–20 review of its monetary policy framework, the current review will include outreach and public events attended by policymakers, community leaders, experts from outside the Federal Reserve System, and other members of the public. (See the box “Periodic Review of Monetary Policy Strategy, Tools, and Communications” on page 45 of the February 2025 Monetary Policy Report.) Monetary policy rules.Simple monetary policy rules, which prescribe a setting for the policy interest rate in response to the behavior of a small number of economic variables, can provide useful guidance to policymakers. With inflation easing and the unemployment rate having increased somewhat, the policy rate prescriptions of most simple monetary policy rules have generally declined since 2023. Currently, most of the rules call for levels of the federal funds rate that are within the current target range. (See the box “Monetary Policy Rules in the Current Environment” on pages 46–48 of the February 2025 Monetary Policy Report.)

Monetary Policy and Economic Developments 9 July 2024 Summary Inflation eased notably last year and has shown modest further progress so far this year, but it remains above the Federal Open Market Committee’s (FOMC) objective of 2 percent. Job gains have been strong, and the unemployment rate is still low. Meanwhile, as job vacancies continued to decline and labor supply continued to increase, the labor market moved into better balance over the first half of the year. Real gross domestic product (GDP) growth was modest in the first quarter, while growth in private domestic demand remained robust, supported by slower but stillsolid increases in consumer spending, moderate growth in capital spending, and a sharp pickup in residential investment. The FOMC has maintained the target range for the federal funds rate at 5¼ to 5½ percent since its July 2023 meeting. In addition, the Committee has continued to reduce its holdings of Treasury securities and agency mortgage-backed securities. The Committee does not expect it will be appropriate to reduce the target range until it has gained greater confidence that inflation is moving sustainably toward 2 percent. Reducing policy restraint too soon or too much could result in a reversal of the progress on inflation. At the same time, reducing policy restraint too late or too little could unduly weaken economic activity and employment. In considering any adjustments to the target range for the federal funds rate, the Committee will carefully assess incoming data, the evolving outlook, and the balance of risks. The FOMC is strongly committed to returning inflation to its 2 percent objective. The Committee remains highly attentive to inflation risks and is acutely aware that high inflation imposes significant hardship, especially on those least able to meet the higher costs of essentials. Recent Economic and Financial Developments Inflation.Although personal consumption expenditures (PCE) price inflation slowed notably last year and has shown modest further progress this year, it remains above the FOMC’s longer-run objective of 2 percent. The PCE price index rose 2.6 percent over the 12 months ending in May, down from the 4.0 percent pace over the preceding 12 months and a peak of 7.1 percent in June 2022. The core PCE price index—which excludes food and energy prices and is generally considered a better guide to the direction of future inflation—also rose 2.6 percent in the 12 months ending in May, down from 4.7 percent a year ago and slower than the 2.9 percent pace at the end of last year. On a 12-month basis, core goods price inflation and housing services price inflation continued to ease over the first part of the year, while core nonhousing services price inflation flattened out after slowing notably last year. Measures of longer-term inflation expectations are within the range of values seen in the decade before the pandemic and continue to be broadly consistent with the FOMC’s longer-run objective of 2 percent.

10 111th Annual Report | 2024 The labor market.The labor market continued to rebalance over the first half of this year, and it remained strong. Job gains were solid, averaging 248,000 per month over the first five months of the year, and the unemployment rate remained low. Labor demand has eased, as job openings have declined in many sectors of the economy, and labor supply has continued to increase, supported by a strong pace of immigration. With cooling labor demand and rising labor supply, the unemployment rate edged up to 4.0 percent in May. The balance between labor demand and supply appears similar to that in the period immediately before the pandemic, when the labor market was relatively tight but not overheated. Nominal wage growth continued to slow in the first part of the year but remains above a pace consistent with 2 percent inflation over the longer term, given prevailing trends in productivity growth. Economic activity.Real GDP growth is reported to have moderated in the first quarter after having increased at a robust pace in the second half of last year. Much of the slowdown was due to sizable drags in the volatile categories of net exports and inventory investment; growth in private domestic final purchases—which includes consumer spending, business fixed investment, and residential investment—also moved a little lower in the first quarter but remained solid. Real consumption growth slowed in the first quarter from a strong pace in the second half of last year, reflecting a decline in goods spending. Real business fixed investment grew at a moderate pace in the first quarter despite high interest rates, supported by strong sales growth and improvements in business sentiment and profit expectations. Activity in the housing sector picked up sharply in the first quarter as a result of a jump in existing home sales and rising construction of singlefamily homes. Financial conditions.Financial conditions appear somewhat restrictive on balance. Treasury yields and the market-implied expected path of the federal funds rate have moved up, on net, since the beginning of the year, while broad equity prices have increased. Credit remains generally available to most households and businesses but at elevated interest rates, which have weighed on financing activity. The pace of bank lending to households and businesses increased in the first five months of the year but continues to be somewhat tepid. Delinquency rates on small business loans stayed slightly above pre-pandemic levels, and delinquency rates for credit cards, auto loans, and commercial real estate loans continued to increase in the first quarter of 2024 to levels above their longer-run averages. Financial stability.The financial system remains sound and resilient. The balance sheets of nonfinancial businesses and households stayed strong, with the combined credit-to-GDP ratio standing near its two-decade low. Business debt continued to decline in real terms, and debtservicing capacity remained solid for most public firms, in large part due to strong earnings, large cash buffers, and low borrowing costs on existing debt. However, there were also signs of vulnerabilities building in the financial system. In asset markets, corporate bond spreads narrowed,

Monetary Policy and Economic Developments 11 equity prices rose faster than expected earnings, and residential property prices remained high relative to market rents. Moreover, in the banking sector, some banks’ fair value losses on fixedrate assets remained sizable, despite most of them continuing to report solid capital levels. Additionally, parts of banks’ commercial real estate portfolios are facing stress. Some banks’ reliance on uninsured deposits remained high. Even so, liquidity at most domestic banks remained ample, with limited reliance on short-term wholesale funding. Bond mutual funds’ exposure to interest rate risk stayed elevated, and data through the third quarter of 2023 show that hedge fund leverage had grown to historical highs, driven primarily by borrowing by the largest hedge funds. (See the box “Developments Related to Financial Stability” on pages 33–34 of the July 2024 Monetary Policy Report.) International developments.Foreign economic activity appears to have improved in the first quarter after a soft patch in the second half of last year. In advanced foreign economies, growth rates returned to moderate levels despite the effects of restrictive monetary policy as lower inflation improved real household incomes. In emerging market economies, growth was supported by a recovery in exports and rising global demand for high-tech products, with the rise in activity in China in the first quarter being particularly outsized. Nonetheless, other factors continued to weigh on economic growth: Data indicated ongoing weakness in China’s property sector, and in Europe, energy-intensive sectors continue to struggle, reflecting their ongoing adjustment to past increases in energy prices following Russia’s 2022 invasion of Ukraine. Foreign headline inflation has continued to decline since the middle of last year, but the pace of disinflation has been gradual and uneven across countries and economic sectors. Still, many foreign central banks have noted this progress in lowering inflation, and some have begun to cut their policy rates. A notable exception is Japan, which ended its negative interest rate policy and yield curve control in March amid persistently high inflation. The trade-weighted exchange value of the dollar rose significantly, consistent with widening gaps between U.S. and foreign interest rates. Monetary Policy Interest rate policy.The FOMC has maintained the target range for the policy rate at 5¼ to 5½ percent since its July 2023 meeting. The Committee judges that the risks to achieving its employment and inflation goals have moved toward better balance over the past year. The Committee perceives the economic outlook to be uncertain and remains highly attentive to inflation risks. The Committee has indicated that it does not expect it will be appropriate to reduce the target range until it has gained greater confidence that inflation is moving sustainably toward 2 percent. Policy is well positioned to deal with the risks and uncertainties the Committee faces in pursuing both sides of its dual mandate. In considering any adjustments to the target range for the federal funds rate, the Committee will carefully assess incoming data, the evolving outlook, and the balance of risks.

12 111th Annual Report | 2024 Balance sheet policy.The Federal Reserve has continued the process of significantly reducing its holdings of Treasury and agency securities in a predictable manner.3Beginning in June 2022, principal payments from securities held in the System Open Market Account have been reinvested only to the extent that they exceeded monthly caps. Under this policy, the Federal Reserve has reduced its securities holdings about $1.7 trillion since the start of balance sheet reduction. The FOMC has stated that it intends to maintain securities holdings at amounts consistent with implementing monetary policy efficiently and effectively in its ample-reserves regime. To ensure a smooth transition from abundant to ample reserve balances, the FOMC slowed the pace of decline of its securities holdings at the beginning of June and intends to stop reductions when reserve balances are somewhat above the level that the Committee judges to be consistent with ample reserves. Special Topics Housing services inflation.The PCE price index for housing services started accelerating in 2021, notably increasing its contribution to core PCE inflation. Because this index calculates average rent for all tenants—both new tenants and existing tenants—its changes tend to lag changes in market rent measures for new leases. Therefore, measures of market rent growth for new leases can help predict future changes in the PCE price index. Since mid-2022, market rents have decelerated and returned to a growth rate similar to or below their average pre-pandemic pace, while the PCE index continues to show elevated inflation, reflecting the gradual pass-through of market rates to existing tenants. As this process continues, PCE housing services inflation should gradually decline, though much uncertainty remains about the extent and timing. (See the box “Housing Services Inflation and Market Rent Measures” on pages 9–11 of the July 2024 Monetary Policy Report.) Employment and earnings across groups.A strong labor market over the past two years has been beneficial across all demographics of workers. Moreover, many of the long-standing disparities in employment and wages by sex, race, ethnicity, and education have narrowed, and some gaps reached historical lows in 2023 and the first half of 2024. However, despite this narrowing, significant disparities in absolute levels across groups remain. (See the box “Employment and Earnings across Demographic Groups” on pages 16–19 of the July 2024 Monetary Policy Report.) Monetary policy independence, transparency, and accountability.Congress has established a statutory framework that specifies the long-run objectives of monetary policy—maximum employment and stable prices—and gives the Federal Reserve operational independence in conducting monetary policy. In this framework, the Federal Reserve makes determinations about the mon- 3 See the May 4, 2022, press release regarding the Plans for Reducing the Size of the Federal Reserve’s Balance Sheet, available on the Board’s website at https://www.federalreserve.gov/newsevents/pressreleases/ monetary20220504b.htm.

Monetary Policy and Economic Developments 13 etary policy actions that are most appropriate for achieving the dual-mandate goals that Congress has assigned to it. The Federal Reserve recognizes that independence is a trust given to it by Congress and the American people and that with independence comes the need to be transparent about, and accountable for, its monetary policy decisions. Transparency also improves monetary policy’s effectiveness. The Federal Reserve promotes transparency by providing information about FOMC decisions through policy communications and a variety of publications. The means by which the Federal Reserve informs the American people about its monetary policy decisions include official FOMC statements, monetary policy reports, and Committee meeting minutes and transcripts, as well as speeches, press conferences, and congressional testimony given by Federal Reserve officials. (See the box “Monetary Policy Independence, Transparency, and Accountability” on pages 42–44 of the July 2024 Monetary Policy Report.) Federal Reserve’s balance sheet and money markets.The size of the Federal Reserve’s balance sheet has continued to decrease since February as the FOMC has reduced its securities holdings. Reserve balances, the largest liability on the Federal Reserve’s balance sheet, and usage of the overnight reverse repurchase agreement facility—another Federal Reserve liability—both declined. (See the box “Developments in the Federal Reserve’s Balance Sheet and Money Markets” on pages 47–49 of the July 2024 Monetary Policy Report.) Monetary policy rules.Simple monetary policy rules, which prescribe a setting for the policy interest rate in response to the behavior of a small number of economic variables, can provide useful guidance to policymakers. With inflation easing over the past year, the policy rate prescriptions of most simple monetary policy rules have decreased recently and now call for levels of the federal funds rate that are close to or below the current target range for the federal funds rate. (See the box “Monetary Policy Rules in the Current Environment” on pages 50–52 of the July 2024 Monetary Policy Report.)

15 3 Financial Stability The Federal Reserve monitors financial system risks and engages at home and abroad to help ensure that the system supports a healthy economy for U.S. households, communities, and businesses. In order to maintain a resilient financial system, the Federal Reserve monitors the potential buildup of risks to financial stability; uses such analyses to inform Federal Reserve responses, including the design of stress-test scenaraios and decisions regarding other policies; works with other domestic agencies directly and through the Financial Stability Oversight Council (FSOC); and engages with the global community in monitoring, supervision, and regulation efforts that mitigate the risks and consequences of financial instability domestically and abroad.1 This section discusses key financial stability activities undertaken by the Federal Reserve over 2024, which include the following: 1. monitoring vulnerabilities that affect financial stability (see figure 3.1 for a summary of key vulnerabilities); 2. promoting a perspective on the supervision and regulation of large, complex financial institutions that accounts for the potential spillovers from distress at such institutions to the financial system and broader economy; and 3. engaging in domestic and international cooperation and coordination. Periodically, Federal Reserve Board staff comprehensively assess potential vulnerabilities relevant for financial system stability. The results of these comprehensive assessments are communicated to the Board, the Federal Open Market Committee (FOMC), and the public through the Financial Stability Report(FSR), the Monetary Policy Report, and the FOMC minutes. These monitoring efforts promote financial stability by informing broader policy discussions and stimulating additional research. Some of these activities are also discussed elsewhere in this annual report. A broader set of economic and financial developments are discussed in section 2, “Monetary Policy and Economic Developments,” with the discussion that follows concerning surveillance of economic and financial developments focused on financial stability. The full range of activities associated with supervision 1 For more information on how the Federal Reserve promotes a stable financial system, see the section “Promoting Financial System Stability” in The Fed Explained: What the Central Bank Does, available on the Board’s website at https:// www.federalreserve.gov/aboutthefed/files/the-fed-explained.pdf.

16 111th Annual Report | 2024 Figure 3.1. The Federal Reserve assesses four key vulnerabilities in monitoring financial stability Each quarter, Federal Reserve Board staff assess a set of four vulnerabilities relevant for financial system stability. These monitoring efforts promote financial stability by informing broader policy discussions and stimulating additional research. Borrowing by businesses Leverage in the Asset valuations Funding risk and households financial sector Why it matters: Why it matters: Why it matters: Why it matters: Overvalued assets Excessive borrowing Excessive leverage Funding risks expose are a vulnerability by businesses and within the financial the financial system because the households leaves sector increases the to the possibility unwinding of high them vulnerable to risk that financial that investors will prices can be distress if their institutions will not “run” by quickly destabilizing. incomes decline or have the ability to withdrawing their the assets they own absorb even modest funds from a fall in value. losses when hit by particular institution adverse shocks. or sector. of systemically important financial institutions and designated financial market utilities is discussed in section 4, “Supervision and Regulation.” Monitoring Financial Vulnerabilities This section describes the Federal Reserve’s monitoring of vulnerabilities in the financial system during 2024. Financial institutions are linked together through a complex set of relationships, and their resilience depends on the economic condition of households and businesses. In turn, the condition of households and businesses hinges on the strength of financial institutions’ balance sheets, as the nonfinancial sector obtains funding through the financial sector. The Federal Reserve’s efforts to measure and monitor risks to financial stability are designed to better understand these complex linkages and are an important part of the Federal Reserve’s efforts to achieve overall economic stability. A stable financial system, when hit by adverse events, or “shocks,” is able to continue meeting demands for financial services from households and businesses, such as credit provision and payment services. By contrast, in an unstable system, these same shocks are likely to have much

Financial Stability 17 larger effects, disrupting the flow of credit and leading to declines in employment and economic activity. Consistent with this view of financial stability, the Federal Reserve Board’s monitoring framework distinguishes between shocks to and vulnerabilities of the financial system. Shocks, such as sudden changes to financial or economic conditions, are inherently hard to predict. Vulnerabilities tend to build up over time and are the aspects of the financial system that are most expected to cause widespread problems in times of stress. Accordingly, the Federal Reserve maintains a flexible, forward-looking financial stability monitoring program focused on assessing how the level and configuration of those vulnerabilities affect the financial system’s resilience to a wide range of potential adverse shocks. Each quarter, Federal Reserve Board staff assess a set of vulnerabilities relevant for financial stability, including, but not limited to, asset valuation pressures, borrowing by households and businesses, leverage in the financial sector, and funding risk. These monitoring efforts inform discussions concerning policies to promote financial stability, such as monetary policy, payment systems, and supervision and regulation. They also inform Federal Reserve interactions with broader monitoring efforts, such as those by the FSOC and the Financial Stability Board (FSB). Since 2018, the Federal Reserve Board has also published its FSR, which summarizes the Board’s framework for assessing the resilience of the U.S. financial system and presents the Board’s current assessment of financial system vulnerabilities.2It aims to promote public understanding about Federal Reserve views on this topic and thereby increase transparency and accountability. The Federal Reserve Board provides a shorter summary and update on how conditions related to financial stability have evolved since publication of the previous FSR in the Monetary Policy Report. The FSR also complements the annual report of the FSOC, which is chaired by the Secretary of the Treasury and includes the Federal Reserve Chair and other financial regulators. Asset Valuation Pressures When asset prices are high relative to their historical relationship with fundamentals, vulnerabilities related to a rapid decline in price increase. A rapid unwinding of prices can be destabilizing, especially if the assets are widely held and the values are supported by excessive leverage, maturity transformation, or risk opacity. Moreover, stretched asset valuations may be an indicator of a broader buildup in risk-taking. 2 See Board of Governors of the Federal Reserve System, Financial Stability Report(Washington: Board of Governors, April 2024), https://www.federalreserve.gov/publications/files/financial-stability-report-20240419.pdf; and Board of Governors of the Federal Reserve System, Financial Stability Report(Washington: Board of Governors, November 2024), https://www.federalreserve.gov/publications/files/financial-stability-report-20241122.pdf.

18 111th Annual Report | 2024 Figure 3.2. Forward price-to-earnings ratio of Figure 3.3. Corporate bond spreads to S&P 500 firms similar-maturity Treasury securities Ratio Percentage points Percentage points 30 12 24 Monthly 11 Monthly 22 27 Triple-B (left scale) 10 20 High-yield (right scale) 24 9 18 Dec. 8 16 21 7 14 18 6 12 5 10 Median 15 4 8 12 3 6 Dec. 2 4 9 1 2 6 0 0 1989 1996 2003 2010 2017 2024 1999 2004 2009 2014 2019 2024 Note: The figure shows the aggregate forward price-to- Note: The triple-B series reflects the option-adjusted earnings ratio of S&P 500 firms based on expected spread of the ICE Bank of America Merrill Lynch earnings for 12 months ahead. The median value (BofAML) triple-B U.S. Corporate Index (C0A4), and the is 15.7. high-yield series reflects the option-adjusted spread of the ICE BofAML U.S. High Yield Index (H0A0). Source: Federal Reserve Board staff calculations using Refinitiv, Institutional Brokers’ Estimate System Source: ICE Data Indices, LLC, used with permission. estimates. The economy remained strong over 2024, and the economic outlook centered on continued growth. Against this backdrop, valuation pressures remained elevated in a range of markets. Equity prices relative to earnings continued to rise toward the high end of their historical range (figure 3.2). Spreads on corporate bonds and loans remained low relative to their historical distributions (figure 3.3). Valuation pressures in the residential real estate sector remained elevated. Despite high borrowing costs and tightened lending standards, various house price indexes continued to increase over the year. The price-to-rent ratio remained at the upper end of its historical distribution. Commercial real estate (CRE) market conditions remain challenging despite some signs of improvement. The pace of declines in CRE prices slowed in 2024, but a substantial volume of office loans and multifamily property loans are set to reprice or mature through 2026. Borrowing by Households and Businesses Excessive borrowing by households and businesses has been an important contributor to past financial crises. A commonly used measure of the financial position of households and businesses is the ratio of the combined total debt of nonfinancial businesses and households relative to gross domestic product (GDP). Growth in nominal GDP outpaced the modest growth in total debt in 2024, leaving the credit-to-GDP ratio close to its lowest level in 20 years (figure 3.4). This

Financial Stability 19 development suggests that, in the aggregate, Figure 3.4. Private nonfinancial-sector households and businesses do not appear to credit-to-GDP ratio have borrowed excessively. Ratio 2.0 In the business sector, gross leverage—the Quarterly ratio of debt to assets for all publicly traded 1.7 nonfinancial firms—remained elevated by his- 1.4 torical standards. Net leverage—the ratio of Q4 debt less cash to assets—showed a similar 1.1 trend. The ability of public firms to service 0.8 their debt, as measured by the interest cov- 1988 1994 2000 2006 2012 2018 2024 erage ratio, remained flat at moderate levels, Note: The shaded bars indicate periods of business in part reflecting resilient earnings. The cumurecession as defined by the National Bureau of Economic Research: July 1990 to March 1991, lative pass-through of increases in interest March 2001 to November 2001, December 2007 to rates during 2022 and 2023 remained mod- June 2009, and February 2020 to April 2020. GDP is gross domestic product. erate, reflecting record issuance of fixed-rate Source: Federal Reserve Board staff calculations corporate bonds—which account for the based on Bureau of Economic Analysis, national income and product accounts, and Federal Reserve majority of the debt of public firms—during Board, Statistical Release Z.1, “Financial Accounts of the United States.” the pandemic, when interest rates were low. However, businesses with floating-rate obligations have experienced significant increases in interest expenses since 2022. In the household sector, household debt relative to GDP continued to edge down to a 20-year low. Mortgage debt accounts for roughly three-fourths of total household debt, with new mortgage extensions skewed toward prime borrowers in recent years. Most of the remaining one-fourth of household debt is consumer credit, which consists primarily of student loans, auto loans, and credit card debt. Although the strength of households’ balance sheets held up through 2024, credit card and auto delinquency rates remained above historical averages. Meanwhile, lenders have tightened credit standards on those types of loans. Leverage in the Financial System The banking system remained sound and resilient overall in 2024. Common equity tier 1 ratios— regulatory risk-based measures of bank capital adequacy—at the largest banks were near or above the top quartile of their range throughout the past decade (figure 3.5). Nonetheless, fair value losses on fixed-income assets remained sizable at some banks, and delinquency rates on credit cards, auto loans, and some CRE categories remained elevated relative to the pre-pandemic level.

20 111th Annual Report | 2024 Figure 3.5. Common equity tier 1 ratio Figure 3.6. Liquid assets held by banks of banks Percent of assets 32 Percent of risk-weighted assets Quarterly 14 28 Quarterly 12 G-SIBs 24 Q4 Large non–G-SIBs 10 Other BHCs 20 Q4 8 16 12 6 G-SIBs 8 Large non–G-SIBs 4 4 Other BHCs 2 0 0 2003 2006 2009 2012 2015 2018 2021 2024 2003 2006 2009 2012 2015 2018 2021 2024 Note: Liquid assets are cash plus estimates of Note: The data are seasonally adjusted by Federal securities that qualify as high-quality liquid assets as Reserve Board staff. Before 2014:Q1, the numerator defined by the liquidity coverage ratio requirement. of the common equity tier 1 ratio is tier 1 common Some discounts and restrictions on Level 2 assets are capital for advanced-approaches bank holding compa- incorporated into the estimate. G-SIBs are global sysnies (BHCs) and intermediate holding companies temically important U.S. banks. Large non-G-SIBs are (IHCs) (before 2015:Q1, for non-advanced-approaches other bank holding companies (BHCs) and interme- BHCs). Afterward, the numerator is common equity diate holding companies with greater than $100 billion tier 1 capital. G-SIBs are global systemically important in total assets. U.S. banks. Large non-G-SIBs are other BHCs and Source: Federal Reserve Board, Form FR Y-9C, IHCs with greater than $100 billion in total assets that Consolidated Financial Statements for Holding are not G-SIBs. The denominator is risk-weighted Companies. assets. The shaded bars indicate periods of business recession as defined by the National Bureau of Economic Research: March 2001 to November 2001, December 2007 to June 2009, and February 2020 to April 2020. Source: Federal Reserve Board, Form FR Y-9C, Consolidated Financial Statements for Holding Companies. Outside the banking sector, leverage at large life insurance companies in 2024 remained above its historical average, and those insurers continued to allocate a substantial share of assets to less liquid instruments. Based on a number of measures, leverage at hedge funds during 2024 was near the top of its historical range, as the Treasury cash-futures basis trade continued to be near historical highs. The volatility spike in August 2024 appeared to be related to some hedge funds having to deleverage their positions to meet internal volatility targets. The event led to a deterioration in liquidity across a broad range of markets, but market conditions quickly recovered. Nevertheless, this event showed how high leverage can amplify adverse shocks. Funding Risk Overall, banks’ liquidity positions remained ample compared with the risk of their funding structures. High-quality liquid assets measured relative to total assets were still at or above prepandemic levels at most banks during 2024 (figure 3.6). During the March 2023 banking-sector stresses, high reliance on funding from uninsured deposits was a key vulnerability among some of

Financial Stability 21 the most affected banks. Since then, the share of uninsured deposits relative to total bank funding has decreased for most banks, especially at those that previously relied heavily on uninsured deposits. Outside the banking sector, assets under management (AUM) of money market funds (MMFs) continued to increase in 2024, as MMFs continued to provide more attractive yields relative to most bank deposits. However, the level of institutional prime MMFs remained below levels 10 years ago. Combined AUM in other cash-management vehicles—such as offshore prime MMFs, shortterm investment funds, private liquidity funds, and ultrashort bond funds—continued to increase and remained at a historically high level. Financial Stability Cooperation and Coordination The Federal Reserve continued its engagement with both domestic and international institutions in 2024 to promote U.S. financial stability. Financial Stability Oversight Council Activities As mandated by the Dodd-Frank Wall Street Reform and Consumer Protection Act, the FSOC was created in 2010. The FSOC is chaired by the Secretary of the Treasury and includes the Chair of the Board of Governors of the Federal Reserve System as one of its 10 voting members. The FSOC established an institutional framework for identifying and responding to sources of systemic risk. Through collaborative participation in the FSOC, U.S. financial regulators monitor not only institutions, but also the financial system as a whole. The Federal Reserve, in conjunction with other participants, assists in monitoring financial risks, analyzing the implications of those risks for financial stability, and identifying steps that can be taken to mitigate those risks. In addition, if the FSOC designates an institution as systemically important, the Federal Reserve assumes responsibility for supervising that institution. Federal Reserve staff regularly contribute to FSOC committees, working groups, and initiatives and brief principals on the Federal Reserve’s key conclusions. The FSOC’s 2024 annual report reviewed significant financial market developments, described potential emerging threats to U.S. financial stability, identified vulnerabilities in the financial system, and made recommendations to mitigate them.3 3 See Financial Stability Oversight Council, Annual Report(Washington: FSOC, 2024), https://home.treasury.gov/system/ files/261/FSOC2024AnnualReport.pdf.

22 111th Annual Report | 2024 Financial Stability Board Activities In light of the interconnected global financial system and the global activities of large U.S. financial institutions, the Federal Reserve participates in international bodies, such as the FSB. The FSB monitors the global financial system and promotes international financial stability by coordinating with national financial authorities and international standard-setting bodies on information exchanges and work focused on developing strong global financial-sector policies.

23 4 Supervision and Regulation The Federal Reserve promotes a safe, sound, and efficient banking and financial system that supports the growth and stability of the U.S. economy. The Federal Reserve carries out its supervisory and regulatory responsibilities and supporting functions primarily by • supervising the activities of financial institutions to promote their safety and Box 4.1. Banking Sector soundness (see figure 4.1); Conditions • developing regulatory policy (rulemakings, For information on banking sector conditions, supervision and regulation letters, policy see the Supervision and Regulation Report, statements, and guidance) and acting on which is generally submitted semiannually to the Senate Committee on Banking, Housing, applications filed by banking organizaand Urban Affairs and to the House Comtions; and mittee on Financial Services. The reports are available on the Board’s website at https:// • monitoring trends in the banking sector by www.federalreserve.gov/publications/ collecting and analyzing data (see box 4.1). supervision-and-regulation-report.htm. Figure 4.1. The Federal Reserve oversees a broad range of financial entities Bank holding companies constitute the largest segment of institutions supervised by the Federal Reserve, but the Federal Reserve also supervises state member banks, savings and loan holding companies, foreign banks operating in the United States, and other entities. See “Supervised and Regulated Institutions” in this section. State member banks (708) Savings and loan Bank holding holding companies (281) companies Foreign banking organizations (3,747) operating in the U.S. (131) State member banks’ foreign branches (46) Edge Act and agreement corporations¹ (32) Designated financial market utilities (8) 1Edge Act and agreement corporations are subsidiaries of banks or bank holding companies, organized to allow international banking and financial business.

24 111th Annual Report | 2024 Supervised and Regulated Institutions The Federal Reserve categorizes banking organizations into portfolios by size and entity type, as described in table 4.1. State Member Banks At year-end 2024, a total of 1,402 banks (excluding non-depository trust companies and private banks) were members of the Federal Reserve System, of which 708 were state chartered. Federal Reserve System member banks operated 47,434 branches, accounting for 35 percent of all commercial banks in the United States and 70 percent of all commercial banking offices. Statechartered commercial banks that are members of the Federal Reserve, commonly referred to as state member banks, represented approximately 18 percent of all insured U.S. commercial banks and held approximately 18 percent of all insured commercial bank assets in the United States. Table 4.1. Summary of supervised institutions (as of December 31, 2024) Number of Total assets Portfolio Definition institutions ($ trillions) Community banking organizations Total assets less than $10 billion 3,408* 3.0 (CBOs) State member banks (SMBs) SMBs within CBO organizations 651 0.6 Regional banking organizations Total assets between $10 billion and $100 billion 105** 3.0 (RBOs) SMBs SMBs within RBO organizations 43 1.2 Large and foreign banking Non-LISCC U.S. firms with total assets $100 billion and greater 172 10.4 organizations (LFBOs) and foreign banking organizations (FBOs) Large banking organizations (LBOs) Non-LISCC U.S. firms with total assets $100 billion and greater 18 5.1 Large FBOs (with intermediate FBOs with combined U.S. assets $100 billion and greater 11 3.1 holding companies (IHC)) Large FBOs (without IHC) FBOs with combined U.S. assets $100 billion and greater 6 1.0 Small FBOs (excluding rep offices) FBOs with combined assets less than $100 billion 105 1.2 Small FBOs (rep offices) FBO U.S. representative offices 32 0.0 SMBs SMBs within LFBO organizations 10 1.1 Large Institution Supervision Eight U.S. global systemically important banks (G-SIBs) 8 15.2 Coordinating Committee (LISCC) SMBs SMBs within LISCC organizations 4 1.2 Insurance and commercial savings SLHCs primarily engaged in insurance or commercial activities 5 insurance 0.5 and loan holding 3 commercial companies (SLHCs) * Includes 3,360 holding companies and 48 state member banks that do not have holding companies. ** Includes 103 holding companies and 2 state member banks that do not have holding companies.

Supervision and Regulation 25 Bank Holding Companies At year-end 2024, a total of 3,747 U.S. bank holding companies (BHCs) were in operation, of which 3,362 were top-tier BHCs. These organizations controlled 3,421 insured commercial banks and held approximately 95 percent of all insured commercial bank assets in the United States. BHCs that meet certain capital, managerial, and other requirements may elect to become financial holding companies (FHCs). FHCs can generally engage in a broader range of financial activities than other BHCs. As of year-end 2025, a total of 497 domestic BHCs and 46 foreign banking organizations (FBOs) had FHC status. Of the domestic FHCs, 23 had consolidated assets of $100 billion or more; 59 between $10 billion and $100 billion; 190 between $1 billion and $10 billion; and 225 less than $1 billion. Savings and Loan Holding Companies At year-end 2024, a total of 281 savings and loan holding companies (SLHCs) were in operation, of which 146 were top-tier SLHCs. These SLHCs controlled 153 depository institutions. Approximately 97 percent of SLHCs engage primarily in depository or broker-dealer activities. These firms hold approximately 63 percent ($853.8 billion) of the total combined assets of all SLHCs. The Office of the Comptroller of the Currency (OCC) or the Federal Deposit Insurance Corporation (FDIC) is the primary federal regulator for subsidiary savings associations of SLHCs. Some SLHCs are engaged primarily in nonbanking activities, such as insurance underwriting (five SLHCs) and commercial activities (three SLHCs). The 25 largest SLHCs accounted for almost $1.3 trillion of total combined assets. Supervised Insurance Organizations At year-end 2024, the Federal Reserve supervised five companies that own depository institutions and are significantly engaged in insurance activities (supervised insurance organizations). All five of these institutions were SLHCs, although one has made the covered savings association election and is therefore treated as a BHC. As of December 31, 2024, they had approximately $450 billion in total assets. Two of these firms have total assets greater than $100 billion, and insured depository assets represent less than half of total assets for four of the five supervised insurance organizations. Supervision of these insurance organizations follows the risk-based approach described in supervision and regulation (SR) letter 22-8, “Framework for the Supervision of Insurance Organizations.” Financial Market Utilities Financial market utilities (FMUs) manage or operate multilateral systems for the purpose of transferring, clearing, or settling payments, securities, or other financial transactions among financial institutions or between financial institutions and the FMU. The Federal Reserve supervises FMUs

26 111th Annual Report | 2024 that are chartered as member banks or Edge Act corporations, and coordinates with other federal banking supervisors to supervise FMUs considered bank service providers under the Bank Service Company Act. In July 2012, the Financial Stability Oversight Council (FSOC) voted to designate eight FMUs as systemically important under title VIII of the Dodd-Frank Wall Street Reform and Consumer Protection Act (Dodd-Frank Act). As a result of these designations, the Board assumed an expanded set of responsibilities related to these designated FMUs that includes promoting uniform risk-management standards, playing an enhanced role in the supervision of designated FMUs, reducing systemic risk, and supporting the stability of the broader financial system. For certain designated FMUs, the Board established risk-management standards and expectations that are articulated in the Board’s Regulation HH. In addition to setting minimum risk-management standards, Regulation HH establishes advance notice requirements for proposed material changes to the rules, procedures, or operations of a designated FMU for which the Board is the supervisory agency under title VIII. Finally, Regulation HH also establishes minimum conditions and requirements for a Federal Reserve Bank to establish and maintain an account for, and provide services to, a designated FMU.1Where the Board is not the title VIII supervisory agency, the Federal Reserve works closely with the Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission to promote robust FMU risk management and monitor systemic risks across the designated FMUs. In March 2024, the Board approved a final rule that updates operational risk-management requirements in Regulation HH. The final updates provide additional clarity and specificity to existing requirements in four key areas of operational risk management: (1) incident management and notification, (2) business continuity management and planning, (3) third-party risk management, and (4) review and testing of operational risk-management measures. International Activities Foreign operations of U.S. banking organizations. At the end of 2024, a total of 26 member and nonmember banks were operating 243 branches in foreign countries and overseas areas of the United States. Ten national banks were operating 190 of these branches, 11 state member banks were operating 42 of these branches, and 5 nonmember banks were operating the remaining 11. 1 The Federal Reserve Banks maintain accounts for and provide services to several designated FMUs.

Supervision and Regulation 27 Edge Act and agreement corporations.At year-end 2024, out of 32 banking organizations chartered as Edge Act or agreement corporations, 3 such organizations operated 6 Edge Act and agreement branches. These corporations are examined annually. U.S. activities of foreign banks.As of September 30, 2024, 131 foreign banks from 47 countries operated U.S. banking offices. These banking offices included 135 state-licensed branches and agencies, of which 6 were insured by the FDIC, and 49 OCC-licensed branches and agencies, of which 4 were insured by the FDIC. These foreign banks also owned 6 Edge Act and agreement corporations. In addition, they held a controlling interest in 33 U.S. commercial banks. Altogether, the U.S. offices of these foreign banks controlled approximately 16.4 percent of U.S. commercial banking assets. These 131 foreign banks also operated 91 representative offices; an additional 33 banks operated in the United State through a representative office. The Federal Reserve conducted or participated with state and federal regulatory authorities in 678 examinations of foreign banks in 2024. Supervisory Developments Supervisory Activities Efforts noted in the following sections reflect work completed by the Federal Reserve in 2024 exclusively. The Federal Reserve’s supervision activities include examinations and inspections to help ensure that financial institutions operate in a safe and sound manner and comply with laws and regulations, including with certain ones relating to consumer protection. These include an assessment of a financial institution’s risk-management systems, financial conditions, governance and controls, and compliance. The Federal Reserve tailors its supervisory approach based on the size and complexity of firms. Supervisory oversight ranges from a continuous supervisory presence with dedicated teams of examiners for large firms to regular point-in-time and targeted periodic examinations for small, noncomplex firms. Supervisory priorities are focused on core and material financial risks, previously identified supervisory findings, and emerging concerns arising from changing economic conditions. Examiners monitor and assess a supervised institution’s remediation of supervisory findings in areas, such as independent risk management and controls, compliance, operational and cyber resilience, and information technology. In 2024, the Federal Reserve conducted 316 examinations of state member banks, 2,894 inspections of bank holding companies, and 120 inspections of savings and loan holding companies.

28 111th Annual Report | 2024 Tables 4.2 and 4.3 provide information on examinations and inspections conducted by the Federal Reserve during the past five years. Table 4.2. Savings and loan holding companies, 2020–24 Entity/item 2024 2023 2022 2021 2020 Top-tier savings and loan holding companies Assets of more than $1 billion Total number 48 48 50 47 50 Total assets (billions of dollars) 1,326 1,334 1,741 1,856 2,026 Number of inspections 46 51 50 63 55 By Federal Reserve System 46 51 50 63 55 Assets of $1 billion or less Total number 98 100 102 107 119 Total assets (billions of dollars) 38 39 36 37 39 Number of inspections 67 69 74 78 91 By Federal Reserve System 67 69 74 78 91 Table 4.3. State member banks and bank holding companies, 2020–24 Entity/item 2024 2023 2022 2021 2020 State member banks Total number 708 706 701 705 734 Total assets (billions of dollars) 4,174 3,894 3,997 4,016 3,568 Number of examinations 540 559 524 471 502 By Federal Reserve System 327 316 289 288 263 By state banking agency 213 243 235 183 239 Top-tier bank holding companies Assets of more than $1 billion Total number 844 824 809 795 746 Total assets (billions of dollars) 26,495 25,979 25,275 25,185 23,811 Number of inspections 1,029 1,051 966 996 875 By Federal Reserve System1 956 989 891 919 814 By state (or other) banking agency 73 62 75 77 61 Assets of $1 billion or less Total number 2,552 2,613 2,672 2,762 2,887 Total assets (billions of dollars) 875 886 883 900 883 Number of inspections 1,765 1,694 1,768 1,801 1,967 By Federal Reserve System 1,640 1,589 1,699 1,727 1,890 By state (or other) banking agency 125 106 69 74 77 Financial holding companies Domestic 497 502 505 504 502 Foreign 46 45 46 45 44 1 For bank holding companies subject to continuous, risk-focused supervision, includes multiple targeted reviews.

Supervision and Regulation 29 Specialized Examinations The Federal Reserve conducts specialized examinations of supervised financial institutions in the areas of capital planning and stress testing, fiduciary activities, transfer agent activities, government and municipal securities dealing and brokering, Bank Secrecy Act and anti-money laundering, operational resilience, information technology, cybersecurity, and shared national credits, among other things. Capital Planning and Stress Testing Since the 2007–09 financial crisis, the Federal Reserve has instituted supervisory stress testing to strengthen capital positions of the largest banking organizations. In March 2020, the Board integrated the supervisory stress test with its non-stress capital requirements through the stress capital buffer. In June 2024, the Federal Reserve released the results of its annual stress test, which showed that the large banking firms tested had sufficient levels of capital and could continue lending to households and businesses during a severe recession. In August 2024, the Federal Reserve announced the individual capital requirements for large banks, which include the stress capital buffer requirement based on the results of the 2024 stress test. These requirements became effective as of October 1, 2024. The Federal Reserve also published an exploratory analysis of risks to the banking system.2The exploratory analysis offered further insight into the resilience of the U.S. banking system by providing information about vulnerabilities of the financial system under a wider range of stresses than the supervisory stress test. Consistent with the nature of an exploratory exercise, the exploratory analysis did not contribute to the capital requirements set by the 2024 stress test. For stress testing publications released in 2024, see box 4.2. In December 2024, the Board notified the public that it would soon seek public comment on significant changes to improve transparency of the stress test and reduce the volatility of the resulting capital buffer requirements.3The announcement noted the Board’s intention to propose changes that include, but are not limited to, disclosing and seeking public comment on all of the models that determine the hypothetical losses and revenues of banks under stress; averaging results over two years to reduce the year-over-year changes in the capital requirements that result from the stress test; and ensuring that the public can comment on the hypothetical scenarios used annually for the test, before the scenarios are finalized. 2 The exploratory analysis included four elements: bank funding stress under moderate and severe stagflation, and two exploratory market shocks with different interest rate movements and a hedge fund default component. 3 For more information, see Board of Governors of the Federal Reserve System, “Due to Evolving Legal Landscape & Changes in the Framework of Administrative Law, Federal Reserve Board Will Soon Seek Public Comment on Significant Changes to Improve Transparency of Bank Stress Tests & Reduce Volatility of Resulting Capital Requirements,” press release, December 23, 2024, https://www.federalreserve.gov/newsevents/pressreleases/bcreg20241223a.htm.

30 111th Annual Report | 2024 Box 4.2. Stress Testing Publications Released in 2024 More details on the 2024 stress test scenarios are available at https://www.federalreserve.gov/ publications/files/2024-stress-test-scenarios-20240215.pdf. More details on the 2024 exploratory analysis parameters are available at https:// www.federalreserve.gov/publications/files/exploratory-analysis-of-risks-to-the-banking-system- 20240215.pdf. More details on the 2024 stress test model methodologies are available at https:// www.federalreserve.gov/publications/files/2024-march-supervisory-stress-test-methodology.pdf. More details on the 2024 stress test results are available at https://www.federalreserve.gov/ publications/files/2024-dfast-results-20240626.pdf. More details on the 2024 exploratory analysis results are available at https://www.federalreserve.gov/ publications/files/exploratory-analysis-results-20240626.pdf. More details on the stress capital buffer requirements published in 2024 are available at https:// www.federalreserve.gov/publications/files/large-bank-capital-requirements-20240828.pdf. Fiduciary Activities In 2024, Federal Reserve examiners conducted 79 fiduciary examinations of state member banks and non-depository trust companies. Transfer Agents During 2024, the Federal Reserve conducted transfer agent examinations at two state member banks and one BHC, each of which were registered as transfer agents. Government and Municipal Securities Dealers and Brokers The Federal Reserve is responsible for examining state member banks and foreign banks for compliance with the Government Securities Act of 1986 and with the U.S. Treasury regulations governing dealing and brokering in government securities. During 2024, the Federal Reserve conducted five examinations of government securities activities at these organizations. The Federal Reserve is also responsible for ensuring that state member banks and BHCs that act as municipal securities dealers comply with the Securities Act Amendments of 1975. Municipal securities dealers are examined, pursuant to the Municipal Securities Rulemaking Board’s rule G-16, at least once every two calendar years. During 2024, the Federal Reserve examined three entities that dealt in municipal securities. Bank Secrecy Act and Anti-Money-Laundering Compliance The Federal Reserve is responsible for examining institutions for compliance with the Bank Secrecy Act (BSA) and applicable anti-money-laundering (AML) laws and regulations and conducts

Supervision and Regulation 31 examinations in accordance with the Federal Financial Institutions Examination Council’s (FFIEC) Bank Secrecy Act/Anti-Money-Laundering Examination Manual. During 2024, the Federal Reserve continued to participate in an ongoing interagency effort to update this manual. Many of the revisions are designed to emphasize and enhance the risk-focused approach to BSA/AML supervision and to continue to provide transparency into the BSA/AML and Office of Foreign Assets Control examination process. To implement a significant part of the Anti-Money-Laundering Act of 2020 (AML Act), Financial Crimes Enforcement Network (FinCEN) and the federal banking agencies issued proposed rules in 2024 to amend AML/CFT program requirements for financial institutions.4 The Federal Reserve continued to participate in the U.S. Treasury-led BSA Advisory Group, which includes representatives of regulatory agencies, law enforcement, and the financial services industry. Operational Resilience, Information Technology, and Cybersecurity Effective operational risk management and resilience are vital to the safety and soundness of financial institutions and the stability of the U.S. financial system.5The Federal Reserve examines and monitors supervised institutions for operational risks as part of its safety and soundness supervision. For example, in 2024 • Federal Reserve examiners, in close coordination with the other federal banking agencies, conducted examinations of information technology (IT) activities (inclusive of cyber riskmanagement activities) and targeted cybersecurity assessments of the large financial institutions, and service providers. • Federal Reserve examiners also conducted tailored cybersecurity assessments at community and regional banking organizations. • Under the authority of the Bank Service Company Act, the federal banking agencies examined regulated technology service providers that provide services subject to the Act for their regulated client financial institutions. • Examiners also conducted a coordinated review of the IT and cybersecurity activities of supervised insurance organizations. The Federal Reserve collaborated with other financial regulators, U.S Treasury, and private industry to promote effective safeguards against operational and cyber risks to the financial services 4 See Anti-Money Laundering and Countering the Financing of Terrorism Programs, 89 Fed. Reg. 55,428 (proposed July 3, 2024), https://www.federalregister.gov/documents/2024/07/03/2024-14414/anti-money-laundering-andcountering-the-financing-of-terrorism-programs and Anti-Money Laundering and Countering the Financing of Terrorism Program Requirements, 89 Fed. Reg. 65,242 (proposed August 9, 2024), https://www.federalregister.gov/documents/ 2024/08/09/2024-16546/anti-money-laundering-and-countering-the-financing-of-terrorism-program-requirements. 5 Operational risk management includes risk management of information technology, cyber, and third-party risks.

32 111th Annual Report | 2024 sector and its critical infrastructure. This included contributions to the FFIEC’s Information Technology Subcommittee and Cybersecurity and Critical Infrastructure Subcommittee, the Financial and Banking Information Infrastructure Committee (FBIIC), the Cybersecurity Forum for Independent and Executive Branch Regulators, the Department of Homeland Security’s Cybersecurity and Infrastructure Security Agency’s Cyber Incident Reporting Council, and Cyber Incident Reporting for Critical Infrastructure Act-related deliberations. The Federal Reserve, together with the other members of the FBIIC and the Financial Services Sector Coordinating Council, collaborated on financial sector resilience initiatives, including participation in the Cloud Executive Steering Group.6 The Board led or contributed to cybersecurity activities undertaken by various international groups. Board staff continued to participate in the work of the Financial Stability Board (FSB) to address current and emerging operational risks. This resulted in the publication of the policy documents, Final Report on Enhancing Third-Party Risk Management and Oversight: A Toolkit for Financial Institutions and Financial Authoritiesand Recommendations to Achieve Greater Convergence in Cyber Incident Reporting: Final Report.7 Complex Bank-Fintech Arrangements There has been an increase in the number and complexity of banks’ arrangements with nonbank entities, such as financial technology companies that provide access to, or facilitate the provision of, banking products and services to customers (bank-fintech arrangements). Bank-fintech arrangements have the potential to increase competition and efficiency by enabling banking organizations to meet evolving customer expectations, deploy products and services to the market more effectively, and access new or expanded customers and resources. In July 2024, the agencies published a joint statement on arrangements with third parties to deliver bank deposit products and services (statement).8The statement notes potential risks related to such arrangements and highlights examples of risk-management practices by banks to manage such risks. The agencies contemporaneously issued a request for information (RFI) on bank-fintech arrangements.9The RFI sought information on a broad range of such arrangements, including with respect to deposit, payment, and lending products and services. Commenters offered valuable insights on these arrangements’ risks and effective practices. 6 See U.S. Department of the Treasury, “U.S. Department of the Treasury Kicks Off Public–Private Executive Steering Group to Address Cloud Report Recommendations,” news release, May 25, 2023, https://home.treasury.gov/news/ press-releases/jy1503. The Federal Reserve and other members of the FBIIC contributed to a Treasury report that assesses the opportunities and challenges the financial sector faces by adopting cloud-based technologies, in which this working group was first announced. 7 See Financial Stability Board, Final Report on Enhancing Third-Party Risk Management and Oversight – A Toolkit for Financial Institutions and Financial Authorities(Basel: FSB, December 2023), https://www.fsb.org/2023/12/final-reporton-enhancing-third-party-risk-management-and-oversight-a-toolkit-for-financial-institutions-and-financial-authorities/ and Recommendations to Achieve Greater Convergence in Cyber Incident Reporting: Final Report(Basel: FSB, April 2023), https://www.fsb.org/2023/04/recommendations-to-achieve-greater-convergence-in-cyber-incident-reporting-final-report/. 8 See https://www.federalreserve.gov/supervisionreg/srletters/SR2405.htm. 9 See https://www.federalregister.gov/documents/2024/07/31/2024-16838/request-for-information-on-bankfintech-arrangements-involving-banking-products-and-services.

Supervision and Regulation 33 Shared National Credit Program The Shared National Credit (SNC) program is an interagency review and assessment of risk in the largest and most complex credits shared by multiple regulated financial institutions. The SNC program is governed by an interagency agreement among the Board, FDIC, and OCC. SNC reviews were completed in the first and third quarters of the 2024 calendar year. More information on the 2023 Shared National Credit review is available at https://www.federalreserve.gov/newsevents/ pressreleases/bcreg20240216a.htm. Securities Credit Lenders Under the Securities Exchange Act of 1934, the Board is responsible for regulating credit in certain transactions involving the purchasing or carrying of securities. As part of its general examination program, the Federal Reserve examines the banks under its jurisdiction for compliance with the Board’s Regulation U. In addition, the Federal Reserve maintains a registry of persons other than banks, brokers, and dealers who extend credit subject to Regulation U. Throughout the year, Federal Reserve examiners conducted specialized examinations of these lenders if they were not already subject to supervision by the Farm Credit Administration or the National Credit Union Administration. Enforcement Actions The Federal Reserve has enforcement authority over the financial institutions it supervises and their affiliated parties. Enforcement actions may be taken to address unsafe or unsound practices and violations of law or regulation. Formal enforcement actions include cease and desist orders, written agreements, prompt corrective action directives, removal and prohibition orders, civil money penalties, and letters sent pursuant to 12 U.S.C. § 1829, known as Section 19 letters. Informal enforcement actions include memoranda of understanding, commitment letters, supervisory letters, and board of directors’ resolutions. In 2024, the Federal Reserve completed 58 formal enforcement actions. Civil money penalties totaling $372,065,956 were assessed. As directed by statute, all civil money penalties are remitted to either the U.S. Treasury or the Federal Emergency Management Agency. The Reserve Banks completed 113 informal enforcement actions. Formal enforcement actions are made public and posted on the Board’s website (https:// www.federalreserve.gov/apps/enforcementactions/search.aspx). Financial Disclosures by State Member Banks Under the Securities Exchange Act of 1934 and the Federal Reserve’s Regulation H, certain state member banks are required to make financial disclosures to the Federal Reserve using the

34 111th Annual Report | 2024 same reporting forms that are normally used by publicly held entities to submit information to the SEC.10 In 2023, one state member bank was required to submit data to the Federal Reserve. These data are made available upon request and are primarily used for disclosure to the bank’s shareholders and public investors. Internal Appeals of Material Supervisory Determinations The Board is committed to maintaining an independent, intra-agency process to review appeals of material supervisory determinations (MSDs) that complies with section 309 of the Riegle Community Development and Regulatory Improvement Act of 1994.11The appeals process includes two levels of review. A panel of Federal Reserve staff not employed by the Reserve Bank with supervisory responsibility of the financial institution that issued the appealed MSD conducts the initial review. This panel determines whether the appealed MSD is consistent with applicable laws, regulations, and policy, and is supported by a preponderance of the evidence in the record. If the appealing institution disagrees with the initial review panel’s decision, the institution may request a final review of the MSD. A panel of senior Board staff conducts the final review. The final review panel determines whether the decision of the initial review panel is reasonable. Additional information is available regarding the Federal Reserve Board’s appeals process and Ombuds policy on the Board’s website.12 In 2024, the Board received four safety and soundness MSD appeals—one from a regional bank holding company, one from a community bank holding company, and two from state member community banking organizations. One of the four safety and soundness MSD appeals received went to final review. Assessments for Supervision and Regulation BHCs and SLHCs with total consolidated assets of $100 billion or more, as well as any nonbank financial companies designated by the FSOC for supervision by the Board, are subject to assessments for the cost of the Board’s supervision and regulation. As a collecting entity, the Board does not recognize the supervision and regulation assessments as revenue, nor does the Board use the collections to fund Board expenses; the funds are transferred to the U.S. Treasury. The Board 10Under section 12(g) of the Securities Exchange Act, certain companies that have issued securities are subject to SEC registration and filing requirements that are similar to those that apply to public companies. Per section 12(i) of the Securities Exchange Act, the powers of the SEC over banking entities that fall under section 12(g) are vested with the appropriate banking regulator. Specifically, state member banks with 2,000 or more shareholders and more than $10 million in total assets are required to register with, and submit data to, the Federal Reserve. For more information on the Board’s Regulation H policy action, see appendix E, “Record of Policy Actions.” 11U.S.C. § 4806. 12See https://www.federalreserve.gov/supervisionreg/srletters/SR2028.htm and https://www.federalreserve.gov/ aboutthefed/ombpolicy.htm.

Supervision and Regulation 35 collected and transferred to the U.S. Treasury $777,662,355 from 52 institutions for the 2023 S&R Regulation TT assessment in 2024. Training and Technical Assistance The Federal Reserve provides training and technical assistance to foreign supervisors and minority-owned depository institutions as well as engages in industry outreach in connection with supervisory objectives. International Training and Technical Assistance The Federal Reserve provides training and technical assistance on supervisory matters to foreign central banks and supervisory authorities. Technical assistance normally involves visits by Federal Reserve staff members to foreign authorities as well as consultations with foreign supervisors who visit the Board of Governors or the Reserve Banks. In 2024, the Federal Reserve organized 27 training seminars, held both onshore and overseas, for the benefit of foreign supervisory authorities. Approximately 900 financial institution supervisors from foreign central banks and supervisory agencies attended these training events. In 2024, Federal Reserve staff also collaborated with the International Monetary Fund and the World Bank to organize two training events for senior supervisory officials. The Federal Reserve also collaborated with the Association of Bank Supervisors of the Americas and the European Central Bank on training events. Efforts to Support Minority-Owned Depository Institutions The Federal Reserve System implements its congressionally mandated responsibilities under section 367 of the Dodd-Frank Act primarily through its Partnership for Progress (PFP) program.13 Established in 2008, this program promotes the viability of minority depository institutions (MDIs) by facilitating activities designed to strengthen their business strategies, maximize their resources, and increase their awareness and understanding of supervisory expectations. The Federal Reserve maintains the PFP website, which supports MDIs by providing them with technical information and links to useful resources.14Representatives from each of the 12 Federal Reserve Districts, along with staff from the Divisions of Supervision & Regulation and Consumer & Community Affairs at the Board of Governors, offer technical assistance tailored to MDIs by providing targeted supervisory guidance, identifying additional resources, and fostering mutually ben- 13Section 367 of the Dodd-Frank Act requires the Board to submit an annual report to Congress detailing the actions taken to fulfill the requirements outlined in section 308 of the Financial Institutions Reform, Recovery, and Enforcement Act (FIRREA) of 1989, as amended by the Dodd-Frank Act in 2010. In addition to the annual reporting requirement, FIRREA section 308 requires the Federal Reserve System to devote efforts toward preserving and promoting minority ownership of MDIs. See also “Annual Report on Promoting Minority Depository Institutions,” Board of Governors of the Federal Reserve System, last modified April 8, 2025, https://www.federalreserve.gov/publications/preserving-minoritydepository-institutions.htm. 14See https://www.fedpartnership.gov.

36 111th Annual Report | 2024 eficial partnerships between MDIs and community organizations and/or other banks. As of 2024:Q4, the Federal Reserve’s MDI portfolio consisted of 16 state member banks. Throughout 2024, the System supported MDIs and conducted a number of outreach initiatives, webinars, and conferences specific to MDIs. Staff Development Programs The Federal Reserve’s staff development program supports the ongoing development of nearly 4,200 professional supervisory staff, ensuring that they have the requisite skills necessary to meet their evolving supervisory responsibilities. The Federal Reserve also provides certain programs to staff at state banking agencies. Training activities in 2024 are summarized in table 4.4. Table 4.4. Training for supervision and regulation, 2024 Number of enrollments Instructional time Course sponsor or type Federal Reserve personnel State and federal banking (approximate training days)2 Number of course offerings agency personnel1 Federal Reserve System 1,126 0 250 78 FFIEC (virtual)3 746 1,871 600 150 FFIEC (in-person) 237 196 244 61 Rapid Response4 18,040 1,247 4.5 35 1 State personnel reflects total state attendees, sponsored by each federal agency. 2 Training days are approximate. System courses were calculated using five days as an average, with FFIEC courses calculated using four days as an average. 3 Virtual training is offered through three alternative delivery methods: (1) virtual, instructor-led classes; (2) the FFIEC Examiner Exchange Program; and (3) self-study programs. 4 Rapid Response is a virtual program created by the Federal Reserve System as a means of providing information on emerging topics to Federal Reserve and state bank examiners. Examiner Commissioning Program An overview of the Federal Reserve System’s Examiner Commissioning Program for assistant examiners is set forth in SR letter 17-6/CA letter 17-1, “Overview of the Federal Reserve’s Supervisory Education Programs.” Three examiner commissioning tracks are available: (1) community banking organization, (2) consumer compliance, and (3) large financial institutions (LFI). On average, individuals move through a combination of in-person training, self-paced learning, virtual instruction, and on-the-job training over a period of about three to four years. Achievement is measured by completing the required course content, demonstrating on-the-job knowledge, and passing a professionally validated proficiency examination. In 2024, 73 examiners passed proficiency examination (34 in community bank organization, 11 in consumer compliance, and 28 in LFI), becoming eligible to earn a commission from the Federal Reserve.

Supervision and Regulation 37 Continuing Professional Development The Federal Reserve provides supervisory staff (and, in many cases, state examiners through existing partnerships with the Conference of State Banking Supervisors and FFIEC) with opportunities to maintain job knowledge after commissioning, learn about emerging concepts and practices, and expand knowledge into highly specialized supervisory topics. A number of learning and communication solutions are developed or curated, including Rapid Response webinars, podcasts, self-guided learning plans on specialty topics, and other content produced for just-in-time communication to supervisory staff about emerging issues and regulatory policy. Regulatory Developments The Federal Reserve carries out its regulatory responsibilities by developing regulatory policy (rulemakings, supervision and regulation letters, policy statements, and guidance) and reviewing and acting on a variety of applications filed by banking organizations. Rulemakings and Guidance The Federal Reserve issues new regulations or revises existing regulations in response to laws enacted by Congress or because of evolving conditions in the financial marketplace. Over 2024, the Federal Reserve, working with the other federal banking agencies, announced a variety of policy actions to promote the safety and soundness, transparency, and efficiency of the financial system. The Federal Reserve issued the following rules and statements in 2024 (see table 4.5). Banking Applications The Federal Reserve reviews applications submitted by BHCs, state member banks, SLHCs, foreign banking organizations, and other entities for approval to undertake various transactions and to engage in new activities. In 2024, the Federal Reserve acted on 807 applications filed under the six relevant statutes. The Federal Reserve publishes the Semiannual Report on Banking Applications Activity, which provides aggregate information on proposals filed by banking organizations and reviewed by the Federal Reserve. The current report as well as historical reports are available at https:// www.federalreserve.gov/publications/semiannual-report-on-banking-applications-activity.htm. Public Notice of Federal Reserve Decisions and Filings Received The Board’s website provides information on orders and announcements (https:// www.federalreserve.gov/newsevents/pressreleases.htm) as well as a guide for U.S. and foreign banking organizations that wish to submit applications (https://www.federalreserve.gov/ bankinforeg/afi/afi.htm).

38 111th Annual Report | 2024 Table 4.5. Federal Reserve or interagency rulemakings/statements/guidance (proposed and final), 2024 Date issued Rulemaking/statement/guidance 1/17/2024 Agencies extend resolution plan submission deadline for some large financial institutions. Joint press release: https://www.federalreserve.gov/newsevents/pressreleases/bcreg20240117a.htm 1/22/2024 Federal Reserve Board announces it will extend the comment period on its interchange fee proposal until May 12, 2024, and published additional related data. Press release: https://www.federalreserve.gov/newsevents/pressreleases/bcreg20240122a.htm 2/6/2024 Federal bank regulatory agencies seek comment on interagency effort to reduce regulatory burden. Press release: https://www.federalreserve.gov/newsevents/pressreleases/bcreg20240206a.htm 2/15/2024 Federal Reserve Board releases hypothetical scenarios for its annual stress test. Press release: https://www.federalreserve.gov/newsevents/pressreleases/bcreg20240215a.htm 2/16/2024 Agencies issue 2023 Shared National Credit Program report. Joint press release: https://www.federalreserve.gov/newsevents/pressreleases/bcreg20240216a.htm 3/8/2024 Federal Reserve Board announces final rule that updates risk management requirements for certain systemically important financial market utilities (FMUs) supervised by the Board. Press release: https://www.federalreserve.gov/newsevents/pressreleases/bcreg20240308a.htm 3/21/2024 Agencies extend applicability date of certain provisions of their Community Reinvestment Act final rule. Press release: https://www.federalreserve.gov/newsevents/pressreleases/bcreg20240321a.htm 4/24/2024 Federal Reserve Board announces it will extend through May 31, 2024, the public comment period for the application by Capital One Financial Corporation to acquire Discover Financial Services. Press release: https://www.federalreserve.gov/newsevents/pressreleases/bcreg20240424a.htm 5/3/2024 Federal Reserve Board requests comment on proposal to expand the operating days of the Federal Reserve Banks’ two large-value payments services, Fedwire Funds Service and the National Settlement Service, to include weekends and holidays. Press release: https://www.federalreserve.gov/newsevents/pressreleases/bcreg20240503a.htm 5/3/2024 Agencies issue guide to assist community banks to develop and implement third-party risk management practices. Press release: https://www.federalreserve.gov/newsevents/pressreleases/bcreg20240503b.htm 5/7/2024 SR 24-2 / CA 24-1: Third-Party Risk Management: A Guide for Community Banks. Release: https://www.federalreserve.gov/supervisionreg/srletters/SR2402.htm 5/9/2024 Federal Reserve Board releases summary of the exploratory pilot Climate Scenario Analysis (CSA) exercise that it conducted with six of the nation’s largest banks. Press release: https://www.federalreserve.gov/newsevents/pressreleases/other20240509a.htm 5/13/2024 Agencies announce inflation-adjusted dollar thresholds for Regulation CC funds availability. Press release: https://www.federalreserve.gov/newsevents/pressreleases/bcreg20240513a.htm 5/14/2024 Agencies announce public meeting on proposed acquisition by Capital One of Discover; public comment period extended. Joint press release: https://www.federalreserve.gov/newsevents/pressreleases/other20240514a.htm 5/17/2024 Federal Reserve Board announces its denial of two rulemaking petitions due to legal and policy considerations. Joint press release: https://www.federalreserve.gov/newsevents/pressreleases/bcreg20240517a.htm 5/31/2024 Agencies issue host state loan-to-deposit ratios. Joint press release: https://www.federalreserve.gov/newsevents/pressreleases/bcreg20240531a.htm 6/6/2024 Federal Reserve Board announces that results from its annual bank stress tests will be released on Wednesday, June 26, at 4:30 p.m. EDT. Press release: https://www.federalreserve.gov/newsevents/pressreleases/bcreg20240606a.htm 6/21/2024 Agencies announce results of resolution plan review for largest and most complex banks. Joint press release: https://www.federalreserve.gov/newsevents/pressreleases/bcreg20240621a.htm 6/21/2024 Federal Reserve Board announces it will extend until September 6, 2024, the comment period on proposal to expand operating days of the Federal Reserve Banks’ two large-value payments services, Fedwire Funds Service and the National Settlement Service. Press release: https://www.federalreserve.gov/newsevents/pressreleases/bcreg20240621b.htm 6/26/2024 Federal Reserve Board annual bank stress test showed that while large banks would endure greater losses than last year’s test, they are well positioned to weather a severe recession and stay above minimum capital requirements. Press release: https://www.federalreserve.gov/newsevents/pressreleases/bcreg20240626a.htm 7/12/2024 Agencies release list of distressed or underserved nonmetropolitan middle-income geographies. Joint press release: https://www.federalreserve.gov/newsevents/pressreleases/bcreg20240712a.htm (continued)

Supervision and Regulation 39 Table 4.5—continued Date issued Rulemaking/statement/guidance 7/17/2024 Agencies issue final rule to help ensure credibility and integrity of automated valuation models. Joint press release: https://www.federalreserve.gov/newsevents/pressreleases/bcreg20240717a.htm 7/18/2024 Agencies finalize interagency guidance on reconsiderations of value for residential real estate valuations. Joint press release: https://www.federalreserve.gov/newsevents/pressreleases/bcreg20240718a.htm 7/18/2025 SR 24-3 / CA 24-4: Interagency Guidance on Reconsiderations of Value of Residential Real Estate Valuations. Release: https://www.federalreserve.gov/supervisionreg/srletters/SR2403.htm 7/19/2024 Agencies request comment on anti-money laundering/countering the financing of terrorism proposed rule. Joint press release: https://www.federalreserve.gov/newsevents/pressreleases/bcreg20240719a.htm 7/22/2024 SR 24-4: Interagency Statement on the Issuance of the AML/CFT Program Notices of Proposed Rulemaking. Release: https://www.federalreserve.gov/supervisionreg/srletters/SR2404.htm 7/25/2024 Federal bank regulatory agencies seek comment on interagency effort to reduce regulatory burden. Joint press release: https://www.federalreserve.gov/newsevents/pressreleases/bcreg20240725a.htm 7/25/2024 Agencies announce public outreach meeting as part of their review of regulations. Joint press release: https://www.federalreserve.gov/newsevents/pressreleases/bcreg20240725b.htm 7/25/2024 Agencies remind banks of potential risks associated with third-party deposit arrangements and request additional information on bank-fintech arrangements. Joint press release: https://www.federalreserve.gov/newsevents/pressreleases/bcreg20240725c.htm 7/25/2024 SR 24-5: Joint Statement on Banks’ Arrangements with Third Parties to Deliver Bank Deposit Products and Services. Release: https://www.federalreserve.gov/supervisionreg/srletters/SR2405.htm 8/2/2024 Federal Reserve Board requests comment on a proposed rule that would establish data standards for certain information collections. Press release: https://www.federalreserve.gov/newsevents/pressreleases/bcreg20240802a.htm 8/5/2024 Federal Reserve Board issues final joint guidance to help certain large banks further develop their resolution plans. Press release: https://www.federalreserve.gov/newsevents/pressreleases/bcreg20240805a.htm 8/28/2024 Federal Reserve Board announces final individual capital requirements for all large banks, effective on October 1. Press release: https://www.federalreserve.gov/newsevents/pressreleases/bcreg20240828a.htm 8/29/2024 SR 24-6: FFIEC Information Technology Examination Handbook – Development, Acquisition, and Maintenance. Release: https://www.federalreserve.gov/supervisionreg/srletters/SR2406.htm 9/5/2024 Federal Reserve Board requests comment around operational practices of the discount window. Press release: https://www.federalreserve.gov/newsevents/pressreleases/bcreg20240905a.htm 9/13/2024 Agencies extend comment period on request for information on bank-fintech arrangements. Joint press release: https://www.federalreserve.gov/newsevents/pressreleases/bcreg20240913a.htm 10/4/2024 Agencies announce dollar thresholds for smaller loan exemption from appraisal requirements for higher-priced mortgage loans. Joint press release: https://www.federalreserve.gov/newsevents/pressreleases/bcreg20241004a.htm 10/4/2024 Agencies announce dollar thresholds for applicability of truth in lending and consumer leasing rules for consumer credit and lease transactions. Joint press release: https://www.federalreserve.gov/newsevents/pressreleases/bcreg20241004b.htm 11/13/2024 Federal Reserve Board invites comment on a report, as prescribed by law, that discusses the impact of a proposed international capital standard. Press release: https://www.federalreserve.gov/newsevents/pressreleases/bcreg20241113a.htm 11/22/2024 Federal Reserve Board announces pricing, effective January 1, 2025, for payment services the Federal Reserve Banks provide to banks and credit unions. Press release: https://www.federalreserve.gov/newsevents/pressreleases/other20241122a.htm 11/22/2024 SR 24-7: FFIEC Cybersecurity Assessment Tool Sunset Statement. Release: https://www.federalreserve.gov/supervisionreg/srletters/sr2407.htm 12/3/2024 Federal bank regulatory agencies seek further comment on interagency effort to reduce regulatory burden. Joint press release: https://www.federalreserve.gov/newsevents/pressreleases/bcreg20241203a.htm 12/4/2024 Agencies issue statement on elder financial exploitation. Joint press release: https://www.federalreserve.gov/newsevents/pressreleases/bcreg20241204a.htm 12/5/2024 SR 24-8 / CA 24-6: Interagency Statement on Elder Financial Exploitation. Release: https://www.federalreserve.gov/supervisionreg/srletters/sr2408.htm (continued)

40 111th Annual Report | 2024 Table 4.5—continued Date issued Rulemaking/statement/guidance 12/9/2024 Federal Reserve Board provides technical clarification that its account access guidelines apply to excess balance accounts. Press release: https://www.federalreserve.gov/newsevents/pressreleases/bcreg20241209a.htm 12/19/2024 Agencies release annual asset-size thresholds under Community Reinvestment Act regulations. Joint press release: https://www.federalreserve.gov/newsevents/pressreleases/bcreg20241219a.htm 12/23/2024 Due to evolving legal landscape & changes in the framework of administrative law, Federal Reserve Board will soon seek public comment on significant changes to improve transparency of bank stress tests & reduce volatility of resulting capital requirements. Press release: https://www.federalreserve.gov/newsevents/pressreleases/bcreg20241223a.htm 12/27/2024 SR 24-9: Status of Certain Investment Funds and their Portfolio Investments for Purposes of Regulation O and Reporting Requirements under Part 363 of FDIC Regulations. Release: https://www.federalreserve.gov/supervisionreg/srletters/SR2409.htm Participation in Financial Standards-Setting Bodies and Other Organizations As a member of the FSB and several international financial standard-setting bodies, the Federal Reserve actively participates in efforts to share information and advance sound supervisory policies for internationally active financial organizations and to enhance the strength, stability, and resilience of the international financial system. Financial Stability Board In 2024, the Federal Reserve continued its participation in a variety of activities of the FSB, an organization whose mission is to promote international financial stability. The FSB helps coordinate the work of national financial authorities and international standard-setting bodies and shares information on supervisory and regulatory practices. Priority areas for the year included enhancing cross-border payments, finalizing recommendations for regulating and supervising crypto-assets and stablecoins, and revising recommendations to address vulnerabilities of openended funds. The full range of the Federal Reserve’s FSB activities is discussed in section 3, “Financial Stability.” The FSB also produces a variety of publications, including progress reports, monitoring reports, guidance, consultative documents, and compendia of better practice. A comprehensive list of FSB publications is available at https://www.fsb.org/publications. Basel Committee on Banking Supervision During 2024, the Federal Reserve contributed to Basel Committee on Banking Supervision (BCBS) supervisory policy recommendations, reports, papers, and consultations designed to improve the supervision of banking organizations’ practices.15In 2024, the BCBS was particularly focused on supporting the implementation of Basel III reforms, reviewing the 2023 banking turmoil, analyzing 15The BCBS provides a forum for regular cooperation on banking supervisory matters. Its 45 members comprise central banks and bank supervisors from 28 jurisdictions.

Supervision and Regulation 41 the digitalization of finance, and tracking emerging risks to the banking system. A comprehensive list of BCBS publications is available at https://www.bis.org/bcbs/publications.htm. International Association of Insurance Supervisors In 2024, the Federal Reserve continued its participation in the development of international supervisory standards for the insurance industry. The Federal Reserve participates actively in standardsetting at the International Association of Insurance Supervisors (IAIS) in consultation and collaboration with state insurance regulators, the National Association of Insurance Commissioners, and the Federal Insurance Office. The Federal Reserve’s participation focuses on financial stability and standards that have the potential to significantly impact the U.S. insurance market. In 2024, the IAIS adopted the Insurance Capital Standard (ICS) and recognized that the U.S.developed Aggregation Method (AM) “provides a basis for implementation of the ICS to produce comparable outcomes.”16The ICS is a risk-based capital measure to evaluate the financial soundness of internationally active insurance groups. U.S. state insurance regulators plan to implement the AM in place of the ICS. Further information can be found in a joint Federal Reserve and U.S. Department of the Treasury study on the ICS’s potential impact on U.S. consumers and markets.17 The IAIS also made progress on other projects in 2024. The IAIS completed its five-year strategic plan, which will cover the period from 2025 to 2029. Notably, this strategic plan envisions the IAIS pivoting significantly towards implementation issues after the finalization of the revision of standards in response to the global financial crisis. The IAIS also issued its annual Global Insurance Market Report (GIMAR) detailing the results of its Global Monitoring Exercise and highlighting insurance sector’s key risks and trends. The IAIS also revised and updated several Insurance Core Principles and elements of its Common Framework for the Supervision of Internationally Active Insurance Groups. International Coordination on Sanctions, Anti-Money-Laundering, and Counter-Terrorism Financing The Federal Reserve participated in a number of international coordination initiatives related to sanctions, money laundering, and terrorism financing. The Federal Reserve continued to monitor and share information with relevant groups regarding the changing sanctions landscape. 16International Association of Insurance Supervisors, “IAIS Adopts Insurance Capital Standard and Other Enhancements to Its Global Standards to Promote a Resilient Insurance Sector,” news release, December 5, 2024, https:// www.iais.org/2024/12/iais-adopts-insurance-capital-standard-and-other-enhancements-to-its-globalstandards-to-promote-a-resilient-insurance-sector/. 17Board of Governors of the Federal Reserve System, The Impact of the International Insurance Capital Standard on Consumers and Markets in the United States (Board of Governors, November 2024), https://www.federalreserve.gov/ publications/files/ics-impact-report-202411.pdf.

42 111th Annual Report | 2024 Additionally, the Federal Reserve has a long-standing role in the U.S. delegation to the intergovernmental Financial Action Task Force and its working groups, contributing a banking supervisory perspective to the formulation of international standards. The Federal Reserve also continued to participate in the work of the FSB that resulted in publication of several reports, including • G–20 Roadmap for Enhancing Cross-border Payments Consolidated Progress Report for 2024;18 • Recommendations to Promote Alignment and Interoperability Across Data Frameworks Related to Cross-Border Payments: Final Report;19and • Recommendations for Regulating and Supervising Bank and Non-Bank Payment Service Providers Offering Cross-Border Payment Services: Final Report.20 The Federal Reserve also continued to participate in committees and subcommittees through the BIS. Specifically, the Federal Reserve actively participated in the AML Experts Group under the BCBS that focuses on AML and CFT issues. The Federal Reserve participated in meetings and roundtables during the year to discuss AML/CFT issues with delegations from countries and regions, such as Australia, Canada, the European Union, Japan, Mexico, New Zealand, the United Kingdom, and member countries of the Pacific Islands Forum. These dialogues are designed to promote information sharing and understanding of AML/CFT issues between U.S. and countryspecific financial sectors. Regulatory Reports The Federal Reserve, along with the other member FFIEC agencies, requires banking organizations to periodically submit reports that provide information about their financial condition and structure. Federal Reserve Regulatory Reports The Federal Reserve requires that U.S. holding companies periodically submit reports that provide information about their financial condition and structure.21For more information on the various reporting forms, see https://www.federalreserve.gov/apps/reportforms/. The following regulatory reporting forms had substantive revisions that became effective in 2024: 18See https://www.fsb.org/2024/10/g20-roadmap-for-enhancing-cross-border-payments-consolidated-progressreport-for-2024/. 19See https://www.fsb.org/2024/12/recommendations-to-promote-alignment-and-interoperability-across-dataframeworks-related-to-cross-border-payments-final-report/. 20See https://www.fsb.org/2024/12/recommendations-for-regulating-and-supervising-bank-and-non-bankpayment-service-providers-offering-cross-border-payment-services-final-report/. 21Holding companies are defined as BHCs, intermediate holding companies (IHCs), SLHCs, and securities holding companies.

Supervision and Regulation 43 • Financial Statements for Holding Companies (FR Y-9 series)—The Board revised the Consolidated Financial Statements for Holding Companies (FR Y-9C) effective December 31, 2024, to align with the U.S. generally accepted accounting principles (GAAP) treatment of modifications to borrowers experiencing financial difficulty.22Additionally, the Board updated the FR Y-9C effective March 31, 2024, to remove references to the allowance for loan and lease losses under the incurred loss methodology.23This change was consistent with Accounting Standards Update (ASU) 2016-13, “Measurement of Credit Losses on Financial Instruments,” which introduced the current expected credit losses methodology for estimating allowances for credit losses. In addition to the FR Y-9C, the Parent Company Only Financial Statements for Large Holding Companies (FR Y-9LP) and Parent Company Only Financial Statements for Small Holding Companies (FR Y-9SP) were revised as a result of ASU 2016-13, effective March 31, 2024, and June 30, 2024, respectively. • Capital Assessments and Stress Testing (FR Y-14)—The Board revised the FR Y-14 to incorporate changes consistent with ASU 2016-13, effective March 31, 2024. • Financial Statements of U.S. Nonbank Subsidiaries of U.S. Holding Companies (FR Y-11), Financial Statements of Foreign Subsidiaries of U.S. Banking Organizations (FR 2314), and Financial Statements of U.S. Nonbank Subsidiaries Held by Foreign Banking Organizations (FR Y-7N)—The Board revised the FR Y-11, the FR 2314, and the FR Y-7N to incorporate changes consistent with ASU 2016-13, effective March 31, 2024. • Holding Company Report of Insured Depository Institutions' Section 23A Transactions with Affiliates (FR Y-8)—The Board revised the FR Y-8 to incorporate changes consistent with ASU 2016-13, effective March 31, 2024. • Quarterly Savings and Loan Holding Company Report (FR 2320)—The Board revised the FR 2320 to incorporate changes consistent with ASU 2016-13, effective March 31, 2024. • Domestic Finance Company Report of Consolidated Assets and Liabilities (FR 2248)—The Board revised the FR 2248 to incorporate changes consistent with ASU 2016-13, effective March 31, 2024. • Weekly Report of Selected Assets and Liabilities of Domestically Chartered Commercial Banks and U.S. Branches and Agencies of Foreign Banks (FR 2644)—The Board revised the FR 2644 to incorporate changes consistent with ASU 2016-13, effective April 3, 2024. • Consolidated Report of Condition and Income for Edge and Agreement Corporations (FR 2886b)—The Board revised the FR 2886b to incorporate changes consistent with ASU 2016-13, effective March 31, 2024. Additionally, the Board revised the FR 2886b to incorporate changes consistent with ASU 2022-02, effective December 31, 2024. 22The revisions are consistent with Accounting Standards Update (ASU) No. 2022-02, Financial Instruments—Credit Losses (Topic 326) Troubled Debt Restructurings and Vintage Disclosures (ASU 2022-02). 2384 Fed. Reg. 11,783 (March 28, 2019), https://www.govinfo.gov/content/pkg/FR-2019-03-28/pdf/2019-05933.pdf.

44 111th Annual Report | 2024 • Annual Report of Foreign Banking Organizations (FR Y-7)—The Board revised the FR Y-7 report by adding an electronic submission option and adding standard templates for reporting (1) financial statements, (2) organizational charts, (3) information about shares and shareholders, (4) eligibility as a qualified FBO, and (5) compliance with prudential standards. The effective date for the electronic submission option and the revised due date was December 31, 2024. The effective date for the standard templates is December 31, 2025. The effective date for the automation of the FR Y-7 report is December 31, 2026. FFIEC Regulatory Reports The Federal Reserve works with the other FFIEC member agencies to develop various uniform regulatory reports submitted by financial institutions.24This information is essential to formulating and conducting supervision and regulation and for the ongoing assessment of the overall soundness of the nation’s financial system. For more information on FFIEC reporting forms, see https:// www.ffiec.gov/ffiec_report_forms.htm. During 2024, the FFIEC member agencies revised FFIEC reports to improve the monitoring of certain exposures and to incorporate changes to U.S. GAAP. Each revision included requests for public comment and approval by the Office of Management and Budget (OMB). • Consolidated Reports of Condition and Income (FFIEC 031, 041, 051)—Effective March 31, 2024, the FFIEC member entities incorporated accounting changes related to ASU 2016-13. The FFIEC member agencies also incorporated accounting for loan modifications to borrowers experiencing financial difficulty as required under U.S. GAAP, clarified and adjusted the reporting of internet website addresses of depository institution trade names, and adopted standards for electronic signatures, which may be used as an alternative to physical signatures. These revisions were effective as of June 30, 2024. Finally, the agencies implemented the collection of additional data on loans to nondepository financial institutions and other loans to improve the consistency and granularity of reporting these exposures, and adjusted the reporting on certain structured financial products that are guaranteed by the U.S. government or governmentsponsored agencies. These revisions were effective as of December 31, 2024.25 • Report of Assets and Liabilities of U.S. Branches and Agencies of Foreign Banks (FFIEC 002)— In addition to incorporating changes for ASU 2016-13, effective March 31, 2024, the FFIEC member agencies revised the FFIEC 002 to be consistent with changes made to the Call Reports, as applicable, resulting from other changes to U.S. GAAP and reporting of loans for purchasing or carrying securities. These changes were effective as of December 31, 2024.26 24The law establishing the FFIEC and defining its functions requires the FFIEC to develop uniform reporting systems for federally supervised financial institutions. See 12 U.S.C. § 3305. 2589 Fed. Reg. 45,046 (May 22, 2024), https://www.govinfo.gov/content/pkg/FR-2024-05-22/pdf/2024-11221.pdf. 2689 Fed. Reg. 45,046 (May 22, 2024), https://www.govinfo.gov/content/pkg/FR-2024-05-22/pdf/2024-11221.pdf.

Supervision and Regulation 45 • Foreign Branch Report of Condition/Abbreviated Foreign Branch Report of Condition (FFIEC 030)— The FFIEC agencies revised the FFIEC 030 to incorporate changes related to ASU 2016-13, effective March 31, 2024, and in December 2024 received OMB approval to add line items related to the Board’s Quarterly Report of Assets and Liabilities of Large Foreign Offices of U.S. Banks (FR 2502q).27The line item additions will assist the agencies in analyzing lending by foreign branches of U.S. banks and are scheduled to become effective March 31, 2025. • Regulatory Capital Reporting for Institutions Subject to the Advanced Capital Adequacy Framework (FFIEC 101)—The agencies revised the FFIEC 101, effective March 31, 2024, to incorporate changes consistent with ASU 2016-13. 2789 Fed. Reg. 81,137 (October 7, 2024), https://www.govinfo.gov/content/pkg/FR-2024-10-07/pdf/2024-23125.pdf.

47 5 Payment System and Reserve Bank Oversight The Federal Reserve performs key functions to maintain the integrity of the U.S. payment and settlement system. These functions help keep cash, check, and electronic transactions moving reliably through the U.S. economy on behalf of households and businesses and the U.S. Treasury. This section discusses the key payment system and Reserve Bank oversight activities undertaken by the Federal Reserve during 2024: • providing payment services to depository and certain other institutions, including the new FedNow® Service to support instant payments (see figure 5.1) • distributing the nation’s currency and coin to depository institutions • serving as fiscal agents and depositories for the U.S. government and other entities • serving as a catalyst for payment system improvements • conducting Reserve Bank oversight to ensure effective internal controls, operations, and management Figure 5.1. Average daily value of Federal Reserve payment services to depository and other institutions Billions of dollars The Federal Reserve provides “priced services” to depository and other institutions (see “Payments Services to Depository and Other Institutions”). These payment and related services are operated as separate business lines and costs are tracked accordingly (see box 5.1). 4,515.6 Advancing research Fedwire Funds 32.6 112.6 and engagement transfers Commercial checks National Settlement collected by the Service settlements Reserve Banks 169.3 2,210.1 Commercial Fedwire Securities ACH transfers transfers

48 111th Annual Report | 2024 Payment Services to Depository and Other Institutions Reserve Banks provide a range of payment and related services to depository and certain other institutions under an integrated organization within the Federal Reserve known as Federal Reserve Financial Services (FRFS); these “priced services” include collecting checks, operating an automated clearinghouse (ACH) service, transferring funds and securities, providing a multilateral settlement service, and operating a round-the-clock payment and settlement service to support instant payments in the United States (see box 5.1).1 In addition to implementing the FedNow Service to support instant payments in 2023, the Reserve Banks have been focused on technology initiatives that will enhance their priced-services processing platforms. These initiatives are expected to enhance efficiency, the overall quality of operations, and the Reserve Banks’ ability to offer additional services, consistent with the longstanding principles of fostering efficiency and safety, to depository institutions. The Reserve Banks continued to enhance the resiliency and information security posture of wholesale payment systems through Reserve Bank-led cyber initiatives to respond to environmental threats and cyber threats. In 2024, the Reserve Banks advanced the safety and security of FedLine Solutions by making progress on key infrastructure upgrades, as well as through proactive monitoring of an evolving threat environment. Commercial Check-Collection Service The commercial check-collection service provides a suite of electronic and paper processing options for forward and return collections.2 In 2024, the Reserve Banks recovered 104.2 percent of the total costs of their commercial checkcollection service, including the related private-sector adjustment factor (PSAF). The Reserve Banks’ operating expenses and imputed costs totaled $104.5 million. Revenue from operations totaled $111.1 million, resulting in a net income of $6.6 million. Reserve Banks handled 2.98 billion checks in 2024, a decrease of 5.4 percent from 2023 (see table 5.1). The average daily value of checks collected by the Reserve Banks in 2024 was approximately $32.6 billion, a decrease of 3.6 percent from the previous year. The Reserve Banks expect volumes to continue to decline because of substitution away from checks to other payment instruments, although the rate of decline is uncertain. 1 Depository institutionsare defined as commercial banks, thrifts, and credit unions. Besides playing an important role in the broader economy by providing transaction accounts, such as checking accounts, to consumers, households, and businesses, these institutions play an important role in the Federal Reserve System’s payment and settlement system function. 2 Forward check collection services provide financial institutions with the ability to deposit checks drawn on other institutions when initially presented for payment. Return check collection services allow financial institutions to send the check back to the bank where it was first deposited if the bank the check is drawn on decides not to pay the check.

Payment System and Reserve Bank Oversight 49 Box 5.1. Priced Services and Cost Recovery The Federal Reserve must (under the Monetary Control Act of 1980) establish fees for “priced services” to recover, over the long run, all the direct and indirect costs associated with its payment and settlement system services. Costs include those actually incurred as well as the imputed costs that would have been incurred—including financing costs, taxes, and certain other expenses—and the return on equity (profit) that would have been earned if a private business firm had provided the services.1The imputed costs and imputed profit are collectively referred to as the private-sector adjustment factor (PSAF). From 2015 through 2024, the Reserve Banks recovered 103.5 percent of the total priced services costs, including the PSAF (see table A). In 2024, Reserve Banks recovered 110.6 percent of the total priced services costs, including the PSAF. The Reserve Banks’ operating expenses and imputed costs totaled $464.2 million. Revenue from operations totaled $524.3 million, resulting in a net income from priced services of $60.1 million. In 2024, all services achieved full cost recovery. The FedNow Service revenue and expenses were excluded from the overall performance projections because new services initially do not have stable volumes, costs, and revenues.2 Table A. Priced services cost recovery, 2015–24 Millions of dollars, except as noted Operating Revenue from Targeted return Cost recovery Year expenses and Total costs services1 on equity (percent)3 imputed costs2 2015 429.1 397.8 5.6 403.4 106.4 2016 434.1 410.5 4.1 414.7 104.7 2017 441.6 419.4 4.6 424.0 104.1 2018 442.5 428.1 5.2 433.3 102.1 2019 444.0 441.2 5.4 446.5 99.4 2020 446.9 434.0 5.9 439.9 101.6 2021 456.0 452.8 4.4 457.2 99.7 2022 466.8 462.8 7.2 470.0 99.3 2023 507.3 467.1 8.4 475.5 106.7 2024 524.3 464.2 9.7 473.9 110.6 2015–24 4,592.9 4,378.0 60.5 4,438.5 103.5 Note: Here and elsewhere in this section, components may not sum to totals or yield percentages shown because of rounding. Excludes amounts related to development of the FedNow Service, reported as $545 million: https://www.federalreserve.gov/paymentsystems/fednow_faq.htm. 1 For the 10-year period, includes revenue from services of $4,589.4 million and other income and expense (net) of $3.5 million. 2 For the 10-year period, includes operating expenses of $4,312.2 million, imputed costs of $9.6 million, and imputed income taxes of $56.1 million. 3 Revenue from services divided by total costs. For the 10-year period, cost recovery is 102.9 percent, including the effect of accumulated other comprehensive income (AOCI) reported by the priced services under ASC 715, Compensation—Retirement Benefits. 1 According to the Accounting Standards Codification (ASC) Topic 715 (ASC 715), Compensation—Retirement Benefits, the Reserve Banks recognized a $574.5 million reduction in equity related to the priced services’ benefit plans through 2024. For details on how implementing ASC 715 affected the pro forma financial statements, refer to note 3 to the pro forma financial statements at the end of this section. 2 The Board communicated in its 2019 Notice Federal Reserve Actions to Support Interbank Settlement of Instant Payments that it expects the FedNow Service to achieve its first instance of long-run cost recovery outside the 10-year time frame typically applied to mature services. See Federal Reserve Actions to Support Interbank Settlement of Instant Payments, 84 Fed. Reg. 39,297 (August 9, 2019), available at https://www.govinfo.gov/content/pkg/FR-2019-08-09/pdf/2019-17027.pdf.

50 111th Annual Report | 2024 Table 5.1. Activity in Federal Reserve priced services, 2022–24 Thousands of items, except as noted Percent change Service 2024 2023 2022 2023–24 2022–23 Commercial check 2,977,825 3,146,474 3,373,580 −5.4 −6.7 Commercial ACH 20,109,461 18,858,315 18,517,858 6.6 1.8 Fedwire funds transfer 209,917 193,317 196,052 8.6 −1.4 National settlement 586 582 586 0.7 −0.8 Fedwire Securities 28,876 25,373 3,410 13.8 644.2 Note: Activity in commercial check is the total number of commercial checks collected, including processed and finesort items; in commercial ACH, the total number of commercial items processed; in Fedwire funds transfer and securities transfer, the number of transactions originated online and offline; and in national settlement, the number of settlement entries processed. Before 2023, the priced component of the Fedwire Securities Service consisted of revenues, expenses, and volumes associated with the transfer of all non-Treasury securities. Starting in 2023, the revenues, expenses, and volumes associated with the transfer of Treasury securities are also included in the priced component of this service. Commercial Automated Clearinghouse Service The commercial ACH service provides batched payment options for same-day and next-day settlement, enabling depository institutions and their customers to process large volumes of payments through electronic batch processes. In 2024, the Reserve Banks recovered 111.7 percent of the total costs of their commercial ACH services, including the related PSAF. The Reserve Banks’ operating expenses and imputed costs totaled $166.5 million. Revenue from operations totaled $190.0 million, resulting in a net income of $23.5 million. The Reserve Banks processed 20.1 billion commercial ACH transactions in 2024, an increase of nearly 6.6 percent from 2023 (see table 5.1). The average daily value of commercial FedACH transfers in 2024 was approximately $169.3 billion, an increase of 7.2 percent from the previous year. FedNow Service The FedNow Service, which launched in July 2023, is a new interbank service for instant payments, or payments that can be made at any hour of the day, every day of the year, with immediate funds availability for receivers. Depository institutions that elect to join the service can offer new payment capabilities to their consumer and business customers, for a wide variety of needs. Instant payments provide tangible benefits for consumers and businesses, such as in cases where rapid access to funds is critical or where just-in-time payments help manage cash flows in bank accounts. By the end of 2024, 1,192 institutions—including large banks, community banks, and credit unions—joined the service, an increase of 33.5 percent from the end of 2023 (see figure 5.2).

Payment System and Reserve Bank Oversight 51 Figure 5.2. FedNow Service quarterly volume and participants Participants Quarterly transactions (thousands) 1,400 1,000 1,200 800 1,000 800 600 600 400 400 200 200 0 0 2023:Q3 2023:Q4 2024:Q1 2024:Q2 2024:Q3 2024:Q4 Participants Quarterly transactions The Reserve Banks processed 1.5 million FedNow transactions in 2024, the first full year of the FedNow Service. The average daily value of FedNow transactions in 2024 was approximately $104.1 million. The number and the value of transactions processed by the FedNow Service in 2024 are consistent with the Federal Reserve’s expectation for a new service line, and the Board expects volume to accelerate over time as more financial institutions join the network. In 2024, the Reserve Banks’ operating expenses and imputed costs for the FedNow Service totaled $231.1 million. Fedwire Funds and National Settlement Services In 2024, the Reserve Banks recovered 110.1 percent of their costs of the Fedwire Funds and National Settlement Services, including the related PSAF. The Reserve Banks’ operating expenses and imputed costs totaled $151.7 million. Revenue from operations totaled $170.3 million, resulting in a net income of $18.6 million. Fedwire Funds Service The Fedwire Funds Service allows depository institutions and their customers to send or receive domestic time-critical, and often high-value, payments using their balances at Reserve Banks to transfer funds interbank in real time. From 2023 to 2024, the number of Fedwire funds transfers originated by depository institutions increased 8.6 percent, to approximately 210 million (see table 5.1). The average daily value of Fedwire funds transfers in 2024 was $4.5 trillion, an increase of 3.8 percent from the previous year.

52 111th Annual Report | 2024 National Settlement Service The National Settlement Service (NSS) is a multilateral settlement system that allows participants in private-sector clearing arrangements to settle transactions using their balances at Reserve Banks. In 2024, NSS processed settlement files for 13 private-sector arrangements that have been established by financial market utilities, check clearinghouse associations, and automated clearinghouse networks. The Reserve Banks processed 8,526 files that contained about 586,000 settlement entries (see table 5.1). Settlement file activity in 2024 decreased 0.5 percent from 2023, while settlement entry activity increased 0.7 percent from 2023. The total value of settlement processed by NSS increased 6.6 percent, to $28.2 trillion. Fedwire Securities Service The Fedwire Securities Service is a central securities depository and real-time securities settlement system that allows its participants to transfer electronically to other service participants certain securities issued by the U.S. Department of the Treasury, federal government agencies, government-sponsored enterprises, and certain international organizations. It also provides for the issuance, safekeeping, and maintenance of those securities. The Reserve Banks provide transfer services for securities issued by the U.S. Treasury, federal government agencies, governmentsponsored enterprises, and certain international institutions. Before 2023, the priced component of this service consisted of revenues, expenses, and volumes associated with the transfer and safekeeping of all non-Treasury securities. Starting in 2023, the revenues, expenses, and volumes associated with the transfer of Treasury securities are also included in the priced component of this service. In 2024, the Reserve Banks recovered 124.8 percent of the costs of their Fedwire Securities Service, including the related PSAF. The Reserve Banks’ operating expenses and imputed costs totaled $41.6 million. Revenue from operations totaled $53.0 million, resulting in a net income of $11.4 million. In 2024, the number of securities transfers processed via the service increased approximately 13.8 percent from 2023, to approximately 28.9 million (see table 5.1). The average daily value of all Fedwire Securities transfers in 2024 was more than $2.2 trillion, an increase of approximately 27.2 percent from the previous year. The Reserve Banks, as fiscal agents for Fedwire Securities issuers, facilitate the principal and interest payments to the Fedwire Securities Service participants holding securities. In 2024, the total cash value of principal and interest payments was $37.9 trillion (an increase of 25.5 percent from 2023).

Payment System and Reserve Bank Oversight 53 The Fedwire Securities Service is the central securities depository for securities issued over the Fedwire Securities Service. At the end of 2024, there was approximately $114 trillion (par value) of Fedwire Securities held in securities accounts maintained by the Reserve Banks as part of the service, a 4.0 percent increase from 2023. At the end of 2024, there were approximately 1.58 million unique securities outstanding on the service, an increase of 5.0 percent from 2023. FedLine Solutions: Access to Reserve Bank Services The Reserve Banks’ FedLine Solutions provide depository institutions with a variety of connections for accessing the Reserve Banks’ payment and information services. For priced services, the Reserve Banks charge fees for these connections and allocate the associated costs and revenue to the various services. There are currently five FedLine Solutions through which depository institutions can access the Reserve Banks’ priced services. These FedLine Solutions are designed to meet the individual connectivity, security, and contingency requirements of depository institution customers. Federal Reserve Intraday Credit The Federal Reserve Board governs the use of Federal Reserve Bank intraday credit, also known as daylight overdrafts.3A daylight overdraft occurs when an institution’s account activity creates a negative balance in the institution’s Federal Reserve account at any time in the operating day. Daylight overdrafts enable an institution to send payments more freely throughout the day than if it were limited strictly by its available intraday funds balance, increasing efficiency and reducing payment system risk. Given the high level of overnight balances institutions hold at the Federal Reserve Banks, daylight overdrafts have remained relatively low, as shown in figure 5.3.4 Fees collected for daylight overdrafts are also at low levels. These fees as well as the use of intraday credit are expected to remain relatively low given the high levels of overnight balances under the ample reserves regime. Additionally, a 2011 policy revision that eliminated fees for collateralized daylight overdrafts has further contributed to the decrease in fees.5 3 See the Payment System Risk policy: https://www.federalreserve.gov/paymentsystems/psr_about.htm. The Payment System Risk policy recognizes explicitly the role of the central bank in providing intraday balances and credit to healthy institutions; under the policy, the Reserve Banks provide collateralized intraday credit at no cost. 4 Increases in the overnight balances institutions held at the Reserve Banks have decreased the demand for intraday credit. Use of intraday credit is expected to remain low given the FOMC’s decision to continue to implement monetary policy within a regime of ample reserves. 5 See the September 30, 2010, press release available on the Board’s website at https://www.federalreserve.gov/ newsevents/pressreleases/other20100930a.htm.

54 111th Annual Report | 2024 Figure 5.3. Aggregate daylight overdrafts 2007–24 200 Billions of dollars 150 100 Peak daylight overdrafts Average daylight overdrafts 50 0 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 Source: Payment Data Repository data, Federal Reserve quarterly payment system risk data. Currency and Coin The Federal Reserve Board issues the nation’s currency (in the form of Federal Reserve notes) to the 12 Federal Reserve Banks. The Reserve Banks, in turn, distribute Federal Reserve notes to depository institutions in response to public demand and the needs of commerce. Together, the Board and Reserve Banks work to maintain the integrity of and confidence in Federal Reserve notes. In 2024, Board staff continued to work with the Reserve Banks and Bureau of Engraving and Printing (BEP) on several strategic initiatives to modernize the U.S. Currency Program over the next decade. These updates are crucial to ensuring the ongoing security and availability of U.S. currency to meet public demand (see box 5.2). The Reserve Banks distributed 30.6 billion Federal Reserve notes into circulation in 2024, a 0.8 percent decrease from 2023, and received 29.8 billion Federal Reserve notes from circulation, a 1.6 percent decrease from 2023. The greater decrease in receipts relative to payments resulted in an increase in net payments of 0.2 billion notes, or 41.2 percent from 2023. However, net payments remain about half of 2019 levels, primarily because of decreased net payments of $100 notes. The continued positive net payments contributed to the continued growth of currency in circulation. The value of Federal Reserve notes issued and outstanding at year-end 2024 totaled $2.3 trillion, a 1.1 percent increase from 2023.

Payment System and Reserve Bank Oversight 55 Box 5.2. U.S. Currency Program Initiatives The Federal Reserve Board of Governors is the issuing authority for Federal Reserve notes. Its staff works closely with the Bureau of Engraving and Printing (BEP) and Reserve Banks to ensure that the production of U.S. currency remains secure and that the notes circulated are high quality and in a quantity sufficient to meet public demand, supporting the Board’s mission to provide a variety of safe and secure payment methods for the public.1 To meet our statutory responsibility as issuing authority of Federal Reserve notes, the Federal Reserve has been collaborating with the BEP and Reserve Banks on several multiyear initiatives to ensure the public continues to have confidence in the security and availability of U.S. currency, and that the Federal Reserve can respond to a range of demand scenarios. For example, the NextGen Program is a multiphase, multiyear program to replace the current fleet of Reserve Bank banknote-processing equipment that is more than 30 years old with next-generation processing machines and improved sensors for authenticating currency deposited at Reserve Banks. This equipment plays a critical role in the Federal Reserve’s ability to maintain currency quality and integrity. During 2024, the Federal Reserve began the pilot-testing phase of the project in four cash offices to test the high-speed banknote-processing equipment. As part of implementing the new machines, the Federal Reserve is assessing the potential strategic benefits of realigning some cash-processing activities, which could offer increased resiliency, sustainability, and efficiency in operations. Long-term planning for vault and processing capacities with a regional and national perspective is also driving updates to individual facilities, including the Federal Reserve Bank of New York’s East Rutherford Operations Center that is undersized for the scope of necessary operations. The facility serves the New York metro area market, processes the highest volume of currency in the Federal Reserve System, and is one of two key offices that services international distribution and circulation of U.S. currency and coin. A new facility located in Warren, New Jersey, will replace the East Rutherford Operations Center. The Miami Branch of the Federal Reserve Bank of Atlanta serves a prominent role as a partner for the Federal Reserve Bank of New York’s international cash function, provides international cash services to certain central banks, and is the third-largest cash operation in the Federal Reserve System. To accommodate the volume of cash that flows through the facility, the vault is undergoing expansion and automation. The Branch’s currency operations currently use a manual currency vault that has not been updated in over four decades. The U.S. Currency Program is developing the next family of U.S. banknotes. The goal of the development process is to produce banknotes that are secure, manufacturable, and functional in commerce for each denomination. The notes must be secure against identified and anticipated counterfeiting threats, with easily recognizable security features that are authenticatable by domestic and international users, and must be manufacturable to meet anticipated demand. Following Treasury’s guidance on the release of new note designs, the first denomination planned for production will be the $10 note, with targeted issuance at the end of 2026. 1 Currency issuance is a mission essential function of the Board, and U.S. currency is the dominant reserve currency in the world. Under the Federal Reserve Act, the Board reimburses the BEP for their expenses necessarily incurred by producing U.S. currency for the Board to issue into commerce.

56 111th Annual Report | 2024 The Reserve Banks also distribute coin to depository institutions on behalf of the U.S. Mint.6In 2024, Reserve Banks distributed 44.1 billion coins into circulation, a 0.5 percent decrease from 2023, and received 37.0 billion coins from circulation, no change compared with 2023. Banknote Development During 2024, Federal Reserve Board staff continued to support efforts related to the development of the next family of U.S. currency. For example, the Advanced Counterfeit Deterrence Steering Committee, composed of the Treasury, the U.S. Secret Service, and Federal Reserve System staff, provided advice on currency design changes to the Secretary of the Treasury, who has sole statutory authority to approve the final currency design. Over the past year, Federal Reserve Board staff, alongside other U.S. Currency Program partners (the Bureau of Engraving and Printing (BEP), FRFS, and the U.S. Secret Service), collaborated on banknote and technology development. Banknote development focuses on meeting requirements based on user needs, security needs, and manufacturing capabilities. Technology development focuses on security features that can further bolster the counterfeit resistance of U.S. currency. To support these efforts, and like many other central banks, the Federal Reserve Board led an adversarial analysis program to increase the counterfeit resilience of U.S. currency and to research counterfeit-deterrence technologies. These activities work in concert to meet the goal of developing the next family of banknotes with new, robust security features effectively integrated into their design, features that are easy to authenticate and difficult for counterfeiters to simulate. The first denomination in the new family of banknotes, the $10, will be ready for issuance at the end of 2026. Currency Education The Federal Reserve Board’s U.S. Currency Education Program (CEP) is responsible for building confidence in U.S. currency by providing education, training, and information about Federal Reserve notes to the global public. The CEP works closely with the U.S. Secret Service, the U.S. Department of State, and the BEP to raise awareness about the designs and security features of Federal Reserve notes. In 2024, the CEP increased engagement with stakeholders who play a critical role in blocking counterfeit currency from entering circulation. In response to the needs of the program’s domestic and international audience, the CEP hosted 10 virtual outreach programs and 7 in-person events, garnering more than 1,400 attendees from three continents (North America, South America, and Africa). 6 The Federal Reserve Board is the issuing authority for Federal Reserve notes, while the U.S. Mint, a bureau of the U.S. Treasury, is the issuing authority for coin.

Payment System and Reserve Bank Oversight 57 Coverage on both traditional and social media contributed to ongoing engagement with the CEP’s website and mobile applications. Uscurrency.gov ended 2024 with more than 3 million web visitors and more than 5.8 million pages viewed on the website. More than 264,000 resources were downloaded from the website. In addition to website resource downloads, 321,300 print resources were shipped out to the global public. CEP’s Cash Assistmobile application was downloaded more than 40,000 times, bringing the lifetime total downloads to more than 317,000. External Engagements Federal Reserve Board staff continued to serve on the Central Bank Counterfeit Deterrence Group and the Five Nations and chaired the United States Cash Machine Group. The Central Bank Counterfeit Deterrence Group is a group of central banks that collaborates to develop and deploy measures to combat digital counterfeiting. The Five Nations is a group of central banks, including the Board, that works on common projects and shares lessons learned in banknote development, distribution, public education, and circulation. The United States Cash Machine Group works closely with manufacturers of cash authentication machines to ensure that new and existing banknotes function in commerce. The Board collaborates with these domestic and international partners to maintain worldwide confidence in U.S. currency. Fiscal Agency and Government Depository Services The Federal Reserve Banks, upon the direction of the Secretary of the Treasury, act as fiscal agents of the U.S. government.7The Reserve Banks, in their role as fiscal agents, develop, operate, maintain, or host a number of applications that support Treasury’s payment services, debt financing and securities services, and financial accounting and reporting services. To support these fiscal agent services, the Reserve Banks provide associated technology infrastructure services. As fiscal agent, the Reserve Banks also maintain the Treasury’s operating cash account, commonly referred to as the Treasury’s general account, or TGA. Additionally, the Reserve Banks provide certain fiscal agency and depository services to other entities. Reserve Bank expenses for providing fiscal agency and depository services totaled $859.3 million, an increase of $88.9 million, or 11.5 percent (see table 5.2). This increase is primarily attributable to Treasury’s request that the Reserve Banks, as fiscal agents, modernize legacy applications or migrate applications to a cloud platform for all fiscal agent services in alignment with the 7 In accordance with section 15 of the Federal Reserve Act, the Treasury and Reserve Banks operate under a principalagent relationship where the Treasury, as principal, provides direction to the Reserve Banks, as agent, and monitors the Reserve Banks’ progress against Treasury’s priorities. See https://www.federalreserve.gov/aboutthefed/section15.htm.

58 111th Annual Report | 2024 federal government’s cloud computing strategy.8The Treasury and other entities reimburse the Reserve Banks for the expense of providing fiscal agency and depository services. Costs for Treasury-related programs accounted for 98.6 percent of expenses, and costs for other entities accounted for the remaining 1.4 percent. Table 5.2. Expenses of the Federal Reserve Banks for fiscal agency and depository services, 2022–24 Thousands of dollars Agency and service 2024 2023 2022 Department of the Treasury Payment services 339,597 336,377 375,606 Debt financing and securities services 244,194 194,413 207,805 Financial accounting and reporting services 86,550 81,136 73,481 Technology infrastructure services 177,052 143,598 147,856 Total, Treasury 847,392 755,524 804,748 Services provided to other entities 11,930 14,849 16,130 Total reimbursable expenses 859,322 770,374 820,878 Note: Service costs include reimbursable pension costs, where applicable. Previous versions of the Annual Report provided a separate line item for pension expenses. Payment Services The Reserve Banks, as fiscal agents, support the Treasury’s payment services by developing, operating, maintaining, or hosting applications that allow the public to receive payments from the Treasury and other federal agencies. In general, agencies send payment instructions to the Treasury, which in turn sends the payment instructions to the Reserve Banks. The Reserve Banks then process those payment instructions, primarily through the Federal Reserve’s FedACH Service, and then settle those payments in the TGA. These payment instructions can include payments to the public such as federal payroll, Social Security benefits, and income tax refunds. The Reserve Banks, as fiscal agents, also develop, operate, maintain, or host applications that allow Treasury and other federal agencies to detect and prevent improper payments. Additionally, the Reserve Banks, as fiscal agents, develop, operate, maintain, or host applications that allow the public to make payments to the Treasury and other federal agencies. The public can send payment instructions to the Treasury and other federal agencies, who in turn send those payment instructions primarily to the Federal Reserve’s FedACH Service and then those payments settle in the TGA. These instructions can include fees, taxes, and non-tax payments owed to the government. 8 The Federal Cloud Computing Strategy—Cloud Smart—is a long-term, high-level strategy to drive federal agency cloud adoption. Additional information can be found at https://www.cio.gov/policies-and-priorities/cloud-smart/.

Payment System and Reserve Bank Oversight 59 In 2024, the Federal Reserve’s ACH service processed nearly 1.8 billion Treasury payments valued at approximately $8.5 trillion. Reserve Bank expenses for providing Treasury payment services were $339.6 million in 2024, an increase of $3.2 million, or 0.9 percent, which is primarily attributable to migrating applications to a cloud platform. Financing and Securities Services The Reserve Banks, as fiscal agents, work closely with the Treasury to raise the financing needed to operate the federal government, which includes functions such as cash forecasting, auction operations, and retail securities support. The Treasury uses the Federal Reserve’s Fedwire Securities Service to issue, maintain, transfer and settle all marketable Treasury securities (bills, notes, and bonds). In 2024, the Treasury, supported by the Reserve Banks, conducted 440 auctions that resulted in the Treasury awarding $28.5 trillion in wholesale Treasury marketable securities to investors. Additionally in 2024, the Treasury issued and serviced $612.0 billion in marketable securities to retail investors, which the Reserve Banks supported through contact center operations. The Reserve Banks also supported the Treasury’s issuance and servicing of $18.0 billion in U.S. savings bonds in 2024 through contact center operations and fulfillment services. Reserve Bank expenses for financing and securities services were $244.2 million in 2024, an increase of $49.8 million, or 25.6 percent, which is primarily attributable to development efforts to modernize legacy applications. Accounting and Reporting Services The Reserve Banks, as fiscal agents, develop, operate, maintain, or host applications to support Treasury’s accounting and reporting services. Specifically, the Reserve Banks, as fiscal agents, manage the TGA by forecasting, monitoring, reconciling, and reporting the government’s overall cash requirements and cash flow. The Reserve Banks, as fiscal agents, also support the Treasury’s publication of Your Guide to America’s Finances; the daily and monthly Treasury statements; the Combined Statement of Receipts, Outlays, and Balances of the United States Government; and the Financial Report of the United States Government.9 9 Your Guide to America’s Finances provides data on federal revenue, spending, deficit, and the national debt and can be found at https://fiscaldata.treasury.gov/americas-finance-guide/. The Daily Treasury Statement summarizes the U.S. Treasury’s cash and debt operations for the federal government on a modified cash basis and can be found at https:// fiscal.treasury.gov/reports-statements/dts/. The Monthly Treasury Statement summarizes the financial activities of the federal government and off-budget federal entities and can be found at https://www.fiscal.treasury.gov/reportsstatements/mts/. The Combined Statement of Receipts, Outlays, and Balances of the United States Government is recognized as the official publication of the government’s receipts and outlays and can be found at https:// fiscal.treasury.gov/reports-statements/combined-statement/. The Financial Report of the United States Government provides the President, Congress, and the American people with a comprehensive view of the federal government’s finances and can be found at https://fiscal.treasury.gov/reports-statements/financial-report/.

60 111th Annual Report | 2024 Reserve Bank expenses for accounting and reporting services were $86.6 million in 2024, an increase of $5.5 million, or 6.8 percent, which is primarily attributable to migrating applications to a cloud platform. Infrastructure and Technology Services The Reserve Banks design, build, and maintain the technology infrastructures and environments that host the majority of applications that the Reserve Banks develop, operate, or maintain as fiscal agent. To align with Treasury’s cloud computing strategy, the Reserve Banks, as fiscal agents, continued to build out and migrate applications to a cloud platform. The Reserve Banks, as fiscal agents, continued to effectively operate infrastructures, plan for end-of-life issues, increase automation, and strengthen their applications against a host of new and evolving cybersecurity threats. Reserve Bank expenses for infrastructure and technology services were $177.0 million in 2024, an increase of $33.4 million, or 23.3 percent, which is primarily attributable to ongoing investments in a cloud platform. Services Provided to Other Entities The Reserve Banks, when permitted by federal statute or when required by the Secretary of the Treasury, also provide fiscal agent services to other domestic and international entities with U.S.dollar-denominated banking services, which include funds, securities, and gold safekeeping; securities clearing, settlement, and investment; and correspondent banking. The Reserve Banks, as fiscal agents, also issue and maintain, in electronic form, many federal agency, government-sponsored enterprise, and certain international organizations securities. The majority of securities services are performed for the Government National Mortgage Association (Ginnie Mae). Reserve Bank expenses for services provided to other entities were $11.9 million in 2024, a decrease of $3.0 million, or 20.1 percent, primarily because these other entities paid lower fees for their use of Federal Reserve Financial Services. Evolutions and Improvements to the System In addition to its role as payment system operator, the Federal Reserve performs several other functions in the payment system, including supervisor and regulator of financial institutions and systemically important financial market utilities, researcher, and catalyst for payment system improvements.

Payment System and Reserve Bank Oversight 61 Payment System Research and Analysis The Federal Reserve conducts research on a wide range of topics related to the design and activities of payment, clearing, and settlement systems and financial market infrastructures, as well as the role of these systems in the commercial activities of consumers, businesses, and governments. In 2024, topics examined in Federal Reserve research included the following: • measurement and analysis of short-run developments and long-run trends in the use of new and established payment methods10 • drivers and potential effects of innovations in the payment system • design, oversight, and regulation of financial market infrastructures • developments related to payments fraud For more information, see the Board’s Payments Research website at https://www.federalreserve.gov/ paymentsystems/payres_about.htm. Digital Innovations Research Federal Reserve staff conducts policy and analytical research to provide perspectives on the future of money and payments shaped by innovation. Staff research covers market developments that could materially impact the payment system in the future such as stablecoins, tokenization, crypto-assets, and AI in payments, as well as new technologies and business models to improve cross-border payments or to facilitate the settlement of wholesale payment transactions. To carry out this work the Federal Reserve engages with a wide variety of domestic and international stakeholders, such as those from the private sector, academia, and the government, to gather perspectives and expertise on innovations topics such as tokenization, distributed ledger technology, application programming interfaces, and digital payments. This includes engagement with multilateral institutions, such as the Bank for International Settlements, G7, and Financial Stability Board, and bilateral engagements with other central banks. Payment System Regulation Congress has assigned to the Board responsibility for implementing the Federal Reserve Act and certain other laws pertaining to a wide range of banking and financial activities, including those related to the payment and settlement system. The Board implements those laws in part through its regulations (see the Board’s website at https://www.federalreserve.gov/supervisionreg/ reglisting.htm). 10In particular, see information about recent releases by the Federal Reserve Payments Study, available at https:// www.federalreserve.gov/paymentsystems/fr-payments-study.htm.

62 111th Annual Report | 2024 In October 2023, the Board requested comment on proposed revisions to Regulation II. Pursuant to the Durbin Amendment to the Dodd-Frank Act, Regulation II is the Board’s rule concerning debit card transactions. The proposal would lower the maximum interchange fee that a large debit card issuer can receive for a debit card transaction. The proposal would also establish a regular process for updating the maximum amount every other year going forward. The Board received more than 3,500 public comments on the proposed revisions and is considering the input received. In December 2022, Congress passed legislation requiring the Board to create and maintain a public database of entities with access to Reserve Bank master accounts and services as well as entities that submit requests for access moving forward. In June 2023, the Federal Reserve Board introduced the Master Account and Services Database, a comprehensive and searchable resource that discloses information on financial institutions’ access to master accounts and financial services provided by the Federal Reserve Banks. Detailed information on the guidelines used by Reserve Banks in evaluating access requests can be found in the associated FAQ. Other Improvements and Efforts The improvement of the efficiency, effectiveness, and security of information technology (IT) services and operations continued to be a central focus of the Reserve Banks. This included continuing priorities for moving applications to the cloud, building out co-location sites with the purpose of closing data centers, aligning IT direction and resources to meet key System objectives, and ensuring that IT leaders and team members are working toward a common set of goals. The highest-level goals—security, agility, and value—guide a set of priorities focused on operating secure and reliable systems, accelerating business outcomes, and enhancing the business-driven digital experience and collaboration. A key enabler in achieving these goals is a multiyear modernization effort launched in 2023, which aims to contemporize infrastructure and improve application delivery and management. In 2024, the Board of Governors collected public input on a proposal to expand the operating days of the Fedwire Funds Service from 22 hours per day, Monday–Friday to 22 hours per day, 7 days per week, every day of the year (22x7x365) and to correspondingly expand the operating days of NSS, with NSS closing 30 minutes earlier than the Fedwire Funds Service.11As technological advancements and globalization of commerce continue to drive change in the large-value payment landscape, expanding the availability of the Fedwire Funds Service and NSS would support the Board’s long-standing policy objective to foster a safe and efficient U.S. payment system by extending the hours in which settlement in risk-free central bank money can occur. The Board is currently evaluating public comments on the proposal and plans to announce a decision on expanded operating hours in a subsequent Federal Registernotice. 11The Board collected public comments during a comment period that lasted from May 3, 2024, to September 6, 2024.

Payment System and Reserve Bank Oversight 63 The Reserve Banks maintained a robust cybersecurity posture throughout 2024, avoiding disruptions from major cybersecurity events and breaches. The Banks remain steadfast in their commitment to combating cyber threats with emphasis on risk mitigation, proactive monitoring, and conducting thorough assessments of cyber risks to enterprise operations and data protection. Over the past year, the Federal Reserve System has significantly bolstered security capabilities through a series of high-priority information security initiatives. Key achievements include the completion of multifactor authentication implementation across all applications in its environment, the enhancement of policies and practices to address Insider Risk Management, and adoption of advanced automated tools to strengthen vulnerability management efforts. These accomplishments reflect the Reserve Banks ongoing dedication to collaborating with business partners to further elevate the overall state of information security across the Federal Reserve System. Oversight of Federal Reserve Banks The combined financial statements of the Reserve Banks and the financial statements of each of the 12 Reserve Banks are audited annually by an independent public accounting firm retained by the Board of Governors.12In addition, the Reserve Banks are subject to oversight by the Board of Governors, which performs its own reviews. The Reserve Banks use the 2013 framework established by the Committee of Sponsoring Organizations of the Treadway Commission (COSO) to assess their internal controls over financial reporting, including the safeguarding of assets. The management of each Reserve Bank annually provides an assertion letter to its board of directors that confirms adherence to COSO standards. The Federal Reserve Board engaged KPMG LLP (KPMG) to audit the 2024 combined and individual financial statements of the Reserve Banks and the financial statements of one limited liability company (LLC) that is associated with the Board of Governors’ actions to address the coronavirus pandemic and is consolidated in the statements of the Federal Reserve Bank of Boston.13In 2024, KPMG also conducted audits of internal controls over financial reporting for each of the Reserve Banks. Fees for KPMG services totaled $9.0 million, of which approximately $0.2 million was for the audit of the LLC.14The audits are conducted in accordance with the Public Company Accounting Oversight Board and auditing standards generally accepted in the United States. To ensure auditor independence, the Board of Governors requires that KPMG be independent in all 12See “Federal Reserve Banks Combined Financial Statements” at https://www.federalreserve.gov/aboutthefed/auditedannual-financial-statements.htm. 13In March 2024, two LLCs were terminated after all holdings were liquidated, final obligations were satisfied, and final distributions of proceeds were made. In addition, KPMG audited the Retirement Plan for Employees of the Federal Reserve System (System Plan), and the Thrift Plan for Employees of the Federal Reserve System (Thrift Plan). The System Plan and the Thrift Plan provide retirement benefits to employees of the Board, the Federal Reserve Banks, and the Consumer Financial Protection Bureau. 14The LLC will reimburse the Board of Governors for the fees related to the audit of its financial statements from the entity’s available assets.

64 111th Annual Report | 2024 matters relating to the audits. Specifically, KPMG may not perform services for the Reserve Banks or affiliated entities that would place it in a position of auditing its own work, making management decisions on behalf of the Reserve Banks, or in any other way impairing its audit independence. In 2024, the Reserve Banks did not engage KPMG for significant non-audit services. The Board’s reviews of the Reserve Banks include a wide range of oversight activities, conducted primarily by its Division of Reserve Bank Operations and Payment Systems. Division personnel monitor, on an ongoing basis, the activities of each Reserve Bank, National Information Technology, and FRFS. The oversight program identifies the most strategically important Reserve Bank current and emerging risks and defines specific approaches to achieve a comprehensive evaluation of the Reserve Banks’ controls, operations, and management effectiveness. The comprehensive reviews include an assessment of the internal audit function’s effectiveness and its conformance to the Institute of Internal Auditors’ (IIA) International Standards for the Professional Practice of Internal Auditing, applicable policies and guidance, and the IIA’s code of ethics. The Board also reviews the System Open Market Account (SOMA) annually to • determine whether the Federal Reserve Bank of New York, while conducting the related transactions and associated controls, complies with the policies established by the Federal Open Market Committee (FOMC); and • assess the SOMA-related IT project management and application development, vendor management, and system resiliency and contingency plans. In addition, KPMG audits the year-end schedule of the SOMA participated asset and liability accounts and the related schedule of participated income accounts. The FOMC is provided with the external audit reports and a report on the Board review. Income and Expenses Annually, the Board releases the combined Reserve Banks financial statements with financial information as of December 31, which include the accounts and results of operations of each of the 12 Reserve Banks. In 2024, current income was $159.3 billion, compared with $175.1 billion in 2023; expenses totaled $236.9 billion, compared with $289.5 billion in 2023; and net loss before providing remittances to the Treasury totaled $77.6 billion, compared with $114.3 billion in 2023. In accordance with the Federal Reserve Act, the Reserve Banks remit excess earnings to the Treasury after providing for the cost of operations, payment of dividends, and reservation of an

Payment System and Reserve Bank Oversight 65 amount necessary to a maintain aggregate surplus. During a period when earnings are not sufficient to provide for those costs, a deferred asset is recorded. A deferred asset represents the shortfall in earnings from the most recent point that remittances were suspended and is the amount of net excess earnings Reserve Banks will need to realize in the future before remittances to the Treasury resume. The Reserve Banks continued to accumulate a deferred asset during 2024 and 2023. Nonetheless, some Reserve Banks continued to periodically remit excess earnings to the Treasury during 2024 and 2023 because remittances are calculated weekly on an individual Reserve Bank basis.15 Table 5.3 summarizes the income, expenses, and distributions of the Reserve Banks for 2024 and 2023. Appendix G of this report, “Statistical Tables,” provides more detailed financial information on the Reserve Banks, including the consolidated LLC.16Additionally, appendix G summarizes the Reserve Banks’ 2024 budget performance and 2025 budgets, budgeting processes, and trends in expenses and employment. Table 5.3. Income, expenses, and distribution of net earnings of the Federal Reserve Banks, 2024 and 2023 Millions of dollars Item 2024 2023 Current income 159,324 175,136 Loan interest income 5,121 10,438 SOMA interest income 153,635 164,087 Other current income1 568 611 Net expenses 232,365 286,480 Operating expenses 5,864 5,648 Reimbursements −886 −812 System pension service cost 621 548 Interest paid on depository institutions deposits and others 186,478 176,755 Interest expense on securities sold under agreements to repurchase 40,288 104,341 Current net (loss) −73,041 −111,344 Net additions to (deductions from) current net income −1,222 −130 Treasury securities (losses), net −37 −32 Federal agency and government-sponsored enterprise mortgage-backed securities (losses), net −70 −56 Foreign currency translation (losses), net −1,478 −67 Other additions or deductions 363 25 Assessments by the Board of Governors2 3,343 2,912 For Board expenditures 1,438 1,144 For currency costs 1,242 1,047 For Consumer Financial Protection Bureau costs3 663 721 (continued) 15The Reserve Banks transferred $3.5 billion and $670 million to the Treasury during 2024 and 2023, respectively. 16Table G.8A is a statement of condition for each Reserve Bank, table G.9 details the income and expenses of each Reserve Bank for 2024, table G.10 shows a condensed statement for each Reserve Bank for the years 1914 through 2024, and table G.12 gives the number and annual salaries of officers and employees for each Reserve Bank.

66 111th Annual Report | 2024 Table 5.3—continued Item 2024 2023 Reserve Bank net (loss) from operations −77,606 −114,386 Consolidated variable interest entities: Income, net 22 1,124 Consolidated variable interest entities: Non-controlling interest (income), net −37 −1,038 Reserve Bank and consolidated variable interest entities net (loss) before providing for remittances to the Treasury −77,621 −114,300 Earnings remittances to the Treasury −79,104 −116,063 Net income after providing for remittances to the Treasury 1,483 1,763 Other comprehensive income (loss) 140 −276 Comprehensive income 1,623 1,487 Total distribution of net (loss) −77,481 −114,576 Dividends on capital stock 1,623 1,487 Remittances transferred to the Treasury4 3,533 670 Deferred asset (increase) −82,637 −116,733 Earnings remittances to the Treasury, net −79,104 −116,063 1 Includes income from priced services and securities lending fees. 2 A detailed account of the assessments and expenditures of the Board of Governors appears in the Board of Governors Financial Statements (see https://www.federalreserve.gov/aboutthefed/audited-annual-financialstatements.htm). 3 The Board of Governors assesses the Reserve Banks to fund the operations of the Consumer Financial Protection Bureau. 4 Represents excess earnings remitted to the Treasury after providing for the cost of operations, payment of dividends, and reservation of surplus. On a weekly basis, if earnings become less than the cost of operations, payment of dividends, and any amount necessary to maintain surplus, the Reserve Banks suspend weekly remittances to the Treasury and record a deferred asset. SOMA Holdings The FOMC has authorized and directed the Federal Reserve Bank of New York to execute open market transactions to the extent necessary to carry out the domestic policy directive adopted by the FOMC. The Federal Reserve Bank of New York, on behalf of the Reserve Banks, holds in the SOMA the resulting securities, which include U.S. Treasuries, federal agency and governmentsponsored enterprise debt securities, federal agency and government-sponsored enterprise mortgage-backed securities, investments denominated in foreign currencies, and commitments to buy or sell related securities.17 Table 5.4 summarizes the average daily assets (liabilities), current income (expenses), and average interest rate of the SOMA holdings for 2024 and 2023. 17See table G.2 in appendix G for a list of Federal Reserve holdings of U.S. Treasuries and federal agency securities.

Payment System and Reserve Bank Oversight 67 Lending In 2024, the average daily balance and the average rate of interest earned for Reserve Bank lending programs were as follows: • Primary, secondary, and seasonal credit extended was $3,774 million and 5.41 percent. • Bank Term Funding Program (BTFP) was $101,647 million and 4.83 percent. • Paycheck Protection Program Liquidity Facility (PPPLF) was $2,704 million and 0.35 percent. In addition, the Federal Reserve Bank of Boston provided loans to a special purpose vehicle (SPV), Main Street Lending Program, that was established in response to the coronavirus pandemic. This SPV provided liquidity to market participants through the purchase of assets in accordance with the terms of the liquidity program.

68 111th Annual Report | 2024 Table 5.4. System Open Market Account holdings of the Federal Reserve Banks, 2024 and 2023 Millions of dollars, except as noted Average interest rate Average daily assets (+)/liabilities (−) Current income (+)/expense (−) (percent) Item Year-over- Year-over- 2024 2023 2024 2023 2024 2023 year change year change System Open Market Account (SOMA) holdings Securities purchased under agreements to resell 16 3,925 −3,909 1 195 −194 5.29 4.96 U.S. Treasury securities, net1 4,672,913 5,335,243 −662,330 100,518 106,479 −5,962 2.15 2.00 Federal agency and governmentsponsored enterprise mortgagebacked securities, net2 2,385,935 2,593,972 −208,037 52,648 57,017 −4,369 2.21 2.20 Government-sponsored enterprise debt securities, net1 2,543 2,570 −27 130 131 −1 5.11 5.11 Foreign currency denominated investments3 18,116 18,399 −283 328 246 82 1.81 1.34 Central bank liquidity swaps4 201 354 −153 10 19 −8 5.37 5.32 Other SOMA assets5 * 1 −1 * * * 0.00 0.00 Total SOMA assets 7,079,724 7,954,464 −874,740 153,635 164,087 −10,452 2.17 2.06 Securities sold under agreements to repurchase: primary dealers and expanded counterparties −391,162 −1,747,804 1,356,642 −19,636 −87,341 67,705 5.02 5.00 Securities sold under agreements to repurchase: foreign official and international accounts −378,540 −336,897 −41,643 −20,652 −17,000 −3,652 5.46 5.05 Total securities sold under agreements to repurchase −769,702 −2,084,701 1,314,999 −40,288 −104,341 64,053 5.23 5.01 Other SOMA liabilities6 −2 −2 * n/a n/a n/a n/a n/a Total SOMA liabilities −769,704 −2,084,703 1,314,999 −40,288 −104,341 64,053 5.23 5.01 Total SOMA holdings 6,310,020 5,869,761 440,259 113,347 59,746 53,601 1.80 1.02 1 Face value, net of unamortized premiums and discounts. 2 Face value, which is the remaining principal balance of the securities, net of unamortized premiums and discounts. Does not include unsettled transactions. 3 Foreign currency denominated assets are revalued daily at market exchange rates. 4 Dollar value of foreign currency held under these agreements valued at the exchange rate to be used when the foreign currency is returned to the foreign central bank. This exchange rate equals the market exchange rate used when the foreign currency was acquired from the foreign central bank. 5 Cash and short-term investments related to the federal agency and government-sponsored enterprise (GSE) mortgage-backed securities (MBS) portfolio. 6 Represents the obligation to return cash margin posted by counterparties as collateral under commitments to purchase and sell federal agency and GSE MBS, as well as obligations that arise from the failure of a seller to deliver securities on the settlement date. n/a Not applicable. * Less than $500,000.

Payment System and Reserve Bank Oversight 69 Pro Forma Financial Statements for Federal Reserve Priced Services Table 5.5. Pro forma balance sheet for Federal Reserve priced services, December 31, 2024 and 2023 Millions of dollars Item 2024 2023 Short-term assets (note 1) Imputed investments 1,089.8 556.3 Receivables 49.3 47.2 Inventory 0.1 0.1 Prepaid expenses 29.0 37.8 Items in process of collection 88.2 67.6 Total short-term assets 1,256.5 709.0 Long-term assets (note 2) Premises 97.4 94.7 Furniture and equipment 54.3 34.9 Leases, leasehold improvements, and long-term prepayments 71.7 72.5 Prepaid pension costs 93.2 115.1 Deferred tax asset 132.6 130.4 Total long-term assets 449.2 447.6 Total assets 1,705.7 1,156.6 Short-term liabilities (note 3) Deferred-availability items 1,178.0 623.8 Short-term debt 27.4 36.2 Short-term payables 51.0 48.9 Total short-term liabilities 1,256.5 709.0 Long-term liabilities (note 3) Long-term debt 91.5 102.2 Accrued benefit costs 272.4 274.7 Total long-term liabilities 363.9 376.9 Total liabilities 1,620.4 1,085.9 Equity (including accumulated other comprehensive loss of $574.5 million and $548.6 million at December 31, 2024 and 2023, respectively) 85.3 70.7 Total liabilities and equity (note 3) 1,705.7 1,156.6 Note: Components may not sum to totals because of rounding. The accompanying notes are an integral part of these pro forma priced services financial statements.

70 111th Annual Report | 2024 Table 5.6. Pro forma income statement for Federal Reserve priced services, 2024 and 2023 Millions of dollars Item 2024 2023 Revenue from services provided to depository institutions (note 4) 524.3 505.3 Operating expenses (note 5) 457.2 462.7 Income from operations 67.2 42.5 Imputed costs (note 6) Interest on debt 5.7 1.2 Interest on float −17.2 −11.6 Sales taxes 4.5 −6.9 5.3 −5.1 Income from operations after imputed costs 74.1 47.7 Other income and expenses (note 7) Investment income 0.0 2.0 Income before income taxes 74.1 49.7 Imputed income taxes (note 6) 14.0 9.6 Net income 60.1 40.1 Memo: Targeted return on equity (note 6) 9.7 8.4 Note: Components may not sum to totals because of rounding. The accompanying notes are an integral part of these pro forma priced services financial statements. Table 5.7. Pro forma income statement for Federal Reserve priced services, by service, 2024 Millions of dollars Commercial Commercial Fedwire Fedwire Item Total check collection ACH funds securities Revenue from services (note 4) 524.3 111.1 190.0 170.3 53.0 Operating expenses (note 5)1 457.2 100.4 174.6 144.1 38.1 Income from operations 67.2 10.7 15.4 26.2 14.9 Imputed costs (note 6) −6.9 2.6 −13.6 3.3 0.9 Income from operations after imputed costs 74.1 8.1 29.0 22.9 14.1 Other income and expenses, net (note 7) 0.0 0.0 0.0 0.0 0.0 Income before income taxes 74.1 8.1 29.0 22.9 14.1 Imputed income taxes (note 6) 14.0 1.5 5.5 4.3 2.6 Net income 60.1 6.6 23.5 18.6 11.4 Memo: Targeted return on equity (note 6) 9.7 2.1 3.7 3.0 0.9 Cost recovery (percent) (note 8) 110.6 104.2 111.7 110.1 124.8 Note: Components may not sum to totals because of rounding. Excludes amounts related to development of the FedNow Service. The accompanying notes are an integral part of these pro forma priced services financial statements. 1 Operating expenses include pension costs, Board expenses, and reimbursements for certain nonpriced services.

Payment System and Reserve Bank Oversight 71 Notes to Pro Forma Financial Statements for Priced Services (1) Short-Term Assets Receivables are composed of fees due the Reserve Banks for providing priced services and the share of suspense- and difference-account balances related to priced services. Items in process of collection are gross Federal Reserve cash items in process of collection (CIPC), stated on a basis comparable to that of a commercial bank. They reflect adjustments for intra-Reserve Bank items that would otherwise be double-counted on the combined Federal Reserve balance sheet and adjustments for items associated with nonpriced items (such as those collected for government agencies). Among the costs to be recovered under the Monetary Control Act is the cost of float, or net CIPC during the period (the difference between gross CIPC and deferred-availability items, which is the portion of gross CIPC that involves a financing cost), valued at the federal funds rate. Investments of excess financing derived from credit float are assumed to be invested in federal funds. (2) Long-Term Assets Long-term assets consist of long-term assets used solely in priced services and the priced-service portion of long-term assets shared with nonpriced services, including a deferred tax asset related to the priced services pension and postretirement benefits obligation. The tax rate associated with the deferred tax asset was 18.8 percent for 2024 and 19.3 percent for 2023. Long-term assets also consist of an estimate of the assets of the Board of Governors used in the development of priced services. (3) Liabilities and Equity Under the matched-book capital structure for assets, short-term assets are financed with shortterm payables and imputed short-term debt, if needed. Long-term assets are financed with longterm liabilities, imputed long-term debt, and imputed equity, if needed. To meet the Federal Deposit Insurance Corporation (FDIC) requirements for a well-capitalized institution, in 2024 equity is imputed at 5.0 percent of total assets and 11.8 percent of risk-weighted assets, and 2023 equity is imputed at 6.1 percent of total assets and 11.4 percent of risk-weighted assets. The Board’s Payment System Risk policy reflects the international standards for financial market infrastructures developed by the Committee on Payment and Settlement Systems and the Technical Committee of the International Organization of Securities Commissions in the Principles for Financial Market Infrastructures. The policy outlines the expectation that the Fedwire Services will meet or exceed the applicable risk-management standards. Although the Fedwire Funds Service does not face the risk that a business shock would cause the service to wind down in a disorderly

72 111th Annual Report | 2024 manner and disrupt the stability of the financial system, in order to foster competition with privatesector financial market infrastructures, the Reserve Banks’ priced services will hold six months of the Fedwire Funds Service’s current operating expenses as liquid net financial assets and equity on the pro forma balance sheet and, if necessary, impute additional assets and equity to meet the requirement. The imputed assets held as liquid net financial assets are cash items in process of collection, which are assumed to be invested in federal funds. In 2024 and 2023, there were sufficient assets and equity such that additional imputed balances were not required. In accordance with ASC 715, Compensation–Retirement Benefits, the Reserve Banks record the funded status of pension and other benefit plans on their balance sheets. To reflect the funded status of their benefit plans, the Reserve Banks recognize the deferred items related to these plans, which include prior service costs and actuarial gains or losses, on the balance sheet. This results in an adjustment to the pension and other benefit plan liabilities related to priced services and the recognition of an associated deferred tax asset with an offsetting adjustment, net of tax, to accumulated other comprehensive income (AOCI), which is included in equity. The Reserve Bank priced services recognized a pension asset, which is a component of accrued benefit costs, of $93.2 million in 2024 and $115.1 million in 2023. The change in the funded status of the pension and other benefit plans resulted in a corresponding decrease in accumulated other comprehensive loss of $25.9 million in 2024. (4) Revenue Revenue represents fees charged to depository institutions for priced services and is realized from each institution through direct charges to an institution’s account. (5) Operating Expenses Operating expenses consist of the direct, indirect, and other general administrative expenses of the Reserve Banks for priced services (that is, Check, ACH, Fedwire Funds, and Fedwire Securities) and the expenses of the Board related to the development of priced services. Board expenses were $7.6 million in 2024 and $6.8 million in 2023. Operating expenses exclude amounts related to the FedNow Service. In accordance with ASC 715, the Reserve Bank priced services recognized qualified pension-plan service costs of $30.9 million in 2024 and $30.3 million in 2023. Operating expenses also include the nonqualified service costs of $2.2 million in 2024 and $2.1 million in 2023. In 2019 Reserve Banks adopted an update to ASC 715 requiring disaggregation of other components of net benefit expense from service costs. The adoption of ASC 715 does not change the systematic approach required by generally accepted accounting principles to recognize the expenses associated with the Reserve Banks’ benefit plans in the income statement. As a result, these expenses

Payment System and Reserve Bank Oversight 73 do not include amounts related to changes in the funded status of the Reserve Banks’ benefit plans, which are reflected in AOCI. The income statement by service reflects revenue, operating expenses, imputed costs, other income and expenses, and cost recovery. The tax rate associated with imputed taxes was 18.8 percent in 2024 and 19.3 percent for 2023. (6) Imputed Costs Imputed costs consist of income taxes, return on equity, interest on debt, sales taxes, and interest on float. Many imputed costs are derived from the PSAF model. The 2024 cost of shortterm debt imputed in the PSAF model is based on nonfinancial commercial paper rates; the cost of imputed long-term debt is based on Merrill Lynch Corporate and High Yield Index returns; and the effective tax rate is derived from U.S. publicly traded firm data, which serve as the proxy for the financial data of a representative private-sector firm. The after-tax rate of return on equity is based on the returns of the equity market as a whole.18 Interest is imputed on the debt assumed necessary to finance priced-service assets. These imputed costs are allocated among priced services according to the ratio of operating expenses for each service to the total expenses for all services. Interest on float is derived from the value of float to be recovered for the check and ACH services, Fedwire Funds Service, and Fedwire Securities Service through per-item fees during the period. Float income or cost is based on the actual float incurred for each priced service. The following shows the daily average recovery of actual credit float by the Reserve Banks for 2024 and 2023, in millions of dollars:19 Daily average recovery of actual float 2024 2023 Total float −340.8 −239.9 Float not related to priced services1 −10.3 −11.9r Float subject to recovery through per-item fees −330.5 −228.0 r Revised. 1 Float not related to priced services includes float generated by services to government agencies and by other central bank services. 18See Federal Reserve Bank Services Private-Sector Adjustment Factor, 77 Fed. Reg. 67,007 (November 8, 2012), https://www.gpo.gov/fdsys/pkg/FR-2012-11-08/pdf/2012-26918.pdf, for details regarding the PSAF methodology. 19Credit float occurs when the Reserve Banks debit the paying bank for checks and other items before providing credit to the depositing bank.

74 111th Annual Report | 2024 Float that is created by account adjustments due to transaction errors and the observance of nonstandard holidays by some depository institutions was recovered from the depository institutions through charging institutions directly. Float subject to recovery is valued at the federal funds rate. Certain ACH funding requirements and check products generate credit float; this float has been subtracted from the cost base subject to recovery in 2024 and 2023. (7) Other Income and Expenses Other income consists of income on imputed investments. Excess financing resulting from additional equity imputed to meet the FDIC well-capitalized requirements is assumed to be invested and earning interest at the 3-month Treasury bill rate. (8) Cost Recovery Annual cost recovery is the ratio of revenue, including other income, to the sum of operating expenses, imputed costs, imputed income taxes, and after-tax targeted return on equity.

75 6 Consumer and Community Affairs The Federal Reserve is committed to promoting fair and transparent financial service markets, protecting consumers’ rights, and ensuring that its policies and research benefit from consumer and community perspectives. The Board promotes consumer protection, financial inclusion, and community development through targeted work in supervision, regulatory policy, research and analysis, and public engagement (see figure 6.1). This section discusses the Federal Reserve’s key consumer and community affairs activities during 2024: • formulating and carrying out supervision and examination policy in collaboration with the Federal Reserve System to promote compliance by financial institutions with consumer protection laws and regulations • writing and reviewing regulations that implement consumer protection and community reinvestment laws • conducting research, analysis, and data collection to identify and assess emerging consumer and community development issues and risks to inform policy decisions • identifying issues and advancing effective community development by engaging, convening, and informing key stakeholders To better understand consumer financial circumstances, the Federal Reserve conducted the yearly Survey on Household Economics and Decisionmaking (SHED) in October 2024. For more information on our consumer and community research, see “Consumer Research and Analysis of Emerging Issues and Policy” later in this section. Consumer Compliance Supervision The Federal Reserve’s consumer protection supervision program assesses compliance by state member banks with a wide range of consumer protection laws and regulations including, but not limited to, the Truth in Lending Act (TILA), the Electronic Fund Transfer Act, the Equal Credit Opportunity Act (ECOA), the Fair Housing Act (FHA), and the prohibition on unfair or deceptive acts or practices (UDAP) in the Federal Trade Commission Act (FTC Act). The program also enforces these laws and regulations and reviews state member banks’ performance under the Community Reinvestment Act (CRA). The Board’s Division of Consumer and Community Affairs develops policies that govern and establish requirements for oversight of the Reserve Banks’ programs for consumer compliance and CRA

76 111th Annual Report | 2024 supervision and examination of state member banks and bank holding companies (BHCs), as well as participating in some Large Institution Supervision Coordinating Committee initiatives. Figure 6.1 The Federal Reserve supported consumer protection and community development in 2024 The Federal Reserve’s 2024 initiatives provided insight about emerging financial trends and economic conditions affecting consumers. See box 6.1 for more information about how DCCA advanced consumer protection and community development through events and outreach, research and analysis, and responsive supervisory guidance. Conducting innovative Engaging stakeholders Updating policies research and analysis through events and outreach The Board collaborated with The 11th annual SHED DCCA partnered with other other financial regulatory report analyzed topics Board divisions to host the agencies to issue policy including food insufficiency, public-facing Financial guidance about topics childcare costs, rental rates, Inclusion Practices and including fintech third-party and the labor market. Innovations conference, partnerships and elder which featured discussions financial exploitation. Other publications explored with Federal Reserve the availability of broadband, leadership, academics, The Federal Reserve also devices, and digital skills and and other thought leaders. hosted the 2024 Fair Lending their effect on communities. Interagency Webinar. Note: SHEDrefers to the Board’s annual Survey of Household Economics and Decisionmaking. In addition, the Board works with the prudential regulators and the Consumer Financial Protection Bureau (CFPB) as part of the supervisory coordination requirements under the Dodd-Frank Wall Street Reform and Consumer Protection Act (Dodd-Frank Act) and ensures that consumer compliance risk is appropriately incorporated into financial institutions’ consolidated risk-management programs. The Board also oversees the development and delivery of examiner training and supervisionrelated budget and technology efforts; analyzes bank and BHC applications related to consumer protection, convenience and needs, and the CRA; and oversees the handling of certain types of consumer complaints by the Reserve Banks and directly processes related appeals, in addition to processing constituent casework matters provided by congressional offices.

Consumer and Community Affairs 77 Consumer Compliance Examinations Examinations are the Federal Reserve’s primary method of promoting compliance with consumer protection laws and assessing the adequacy of consumer compliance risk-management systems within regulated entities.1 In 2024, the Board’s regulatory efforts supported compliance by financial institutions by clarifying examination guidelines and procedures.2In June, the Federal Reserve and its Federal Financial Institutions Examination Council (FFIEC) partners revised the guide to Home Mortgage Disclosure Act (HMDA) reporting.3The updated guide summarizes key requirements to assist financial institutions complying with HMDA as implemented by the CFPB’s Regulation C. The Federal Reserve continued to monitor financial institutions for regulatory compliance. The Reserve Banks completed 394 examinations in 2024. The breakdown of consumer compliance examinations completed by Reserve Banks in 2024 included 204 consumer compliance examinations of state member banks. Community Reinvestment Act Performance Evaluation and Regulations The CRA requires that the Federal Reserve Board and the other federal banking agencies assess a bank’s record of meeting the credit needs of its entire community, including low- and moderateincome neighborhoods, consistent with safe and sound operations. To carry out this mandate and to encourage banks to help meet the credit needs of the local communities in which they are chartered, the Federal Reserve • examines state member banks and certain other financial institutions to assess their performance under the CRA, • considers banks’ CRA performance in context with other supervisory information when analyzing applications for mergers and acquisitions, and • disseminates information about community development practices to bankers and the public through community development offices at the Reserve Banks.4 1 The Federal Reserve has examination and enforcement authority for federal consumer financial laws and regulations for insured depository institutions with assets of $10 billion or less that are state member banks and not affiliates of covered institutions, as well as for conducting CRA examinations for all state member banks regardless of size. The Federal Reserve also has examination and enforcement authority for certain federal consumer financial laws and regulations for insured depository institutions that are state member banks regardless of asset size, while the CFPB has examination and enforcement authority for many federal consumer financial laws and regulations for insured depository institutions with over $10 billion in assets and their affiliates (covered institutions), as mandated by the Dodd-Frank Act. For data on state member banks and other institutions supervised by the Federal Reserve (including number and assets of), see section 4, “Supervision and Regulation.” 2 See https://www.federalreserve.gov/supervisionreg/caletters/caletters.htm for consumer compliance supervisory guidance issued in 2024. 3 See Consumer Affairs (CA) letter 24-3, “Revised ‘A Guide to HMDA Reporting: Getting It Right!,’” https://www.federalreserve. gov/supervisionreg/caletters/caltr2403.htm. 4 For more information on various community development activities of the Federal Reserve System, see https://www.fedcommunities.org/.

78 111th Annual Report | 2024 The Federal Reserve assesses and rates the CRA performance of state member banks and certain other institutions during performance evaluations conducted by staff at the 12 Reserve Banks. During the 2024 reporting period, the Reserve Banks completed 174 CRA examinations of state member banks. Of those banks examined, 23 were rated “Outstanding,” 151 were rated “Satisfactory,” none were rated “Needs to Improve,” and none were rated “Substantial Non- Compliance.”5 Consumer Compliance Enforcement Activities Fair Lending and UDAP Enforcement The Federal Reserve is committed to ensuring that the institutions it supervises comply fully with the federal fair lending and consumer protection laws, including ECOA, the FHA, and the FTC Act, which prohibits unfair or deceptive acts or practices. The ECOA prohibits creditors from discriminating against any applicant, in any aspect of a credit transaction, on the basis of race, color, religion, national origin, sex, marital status, or age. In addition, creditors may not discriminate against an applicant because the applicant receives income from a public assistance program or has exercised, in good faith, any right under the Consumer Credit Protection Act. The FHA prohibits discrimination in residential real estate–related transactions, including the making and purchasing of mortgage loans, on the basis of race, color, religion, sex, handicap, familial status, or national origin. The Federal Reserve supervises all state member banks for compliance with the FHA. The Federal Reserve and the CFPB have supervisory authority for compliance with the ECOA. For state member banks with assets of $10 billion or less, the Board has the authority to enforce ECOA. For state member banks with assets over $10 billion, the CFPB has this authority. With respect to the FTC Act, the Federal Reserve has supervisory and enforcement authority over all state member banks, regardless of asset size, and consults with the CFPB with regard to state member banks over $10 billion in assets. An act or practice may be found to be unfair if it causes or is likely to cause substantial injury to consumers that is not reasonably avoidable by consumers and is not outweighed by countervailing benefits to consumers or to competition. A representation, omission, or practice is deceptive if it is likely to mislead a consumer acting reasonably 5 On October 24, 2023, the Board, the FDIC, and the OCC jointly issued a final rule to amend the current CRA regulations. The final rule is published in the Federal Register at 89 Fed. Reg. 6574, and available at https:// www.federalregister.gov/documents/2024/02/01/2023-25797/community-reinvestment-act. Certain trade associations filed a complaint with the U.S. District Court for the Northern District of Texas seeking declaratory and injunctive relief from the CRA final rule. On March 29, 2024, the District Court stayed the final rule. The current CRA regulations remain in effect, and the agencies continue to assess banks’ CRA performance under the current regulatory framework until further notice.

Consumer and Community Affairs 79 under the circumstances and is material, and thus likely to affect a consumer’s conduct or decision regarding a product or service.6 With respect to fair lending, if the Board has reason to believe that a creditor has engaged in a pattern or practice of discrimination in violation of ECOA, the matter must be referred to the Department of Justice (DOJ). The DOJ reviews the referral and determines whether further investigation is warranted. A DOJ investigation may result in a public civil enforcement action. Alternatively, the DOJ may decide to return the matter to the Board for administrative action. If a matter is returned to the Board, staff ensure that the institution takes all appropriate corrective action. In 2024, the Board referred no fair lending matters to the DOJ. If there is a fair lending violation that does not constitute a pattern or practice of discrimination or if there is a UDAP violation, the Federal Reserve takes action to ensure that the violation is remedied by the bank. The Federal Reserve uses a range of supervisory and enforcement tools, including nonpublic and public enforcement actions, to resolve any ECOA, FHA, or UDAP violations and ensure that the institution takes appropriate corrective action. For example, the Federal Reserve can also use informal supervisory tools such as memoranda of understanding between banks’ boards of directors and the Reserve Banks to ensure that violations are corrected. When necessary, the Board can bring public enforcement actions. When examiners find evidence of potential discrimination or potential UDAP violations, Board and Reserve Bank staff collaborate to provide additional legal and statistical expertise and ensure that fair lending and UDAP laws are enforced consistently and rigorously throughout the Federal Reserve System. In July 2024, the Board announced the issuance of a public enforcement action for numerous UDAP violations, compliance risk-management deficiencies, and Bank Secrecy Act-related concerns. The UDAP violations related to unfair and deceptive practices involving the marketing, selling, and servicing of prepaid debit card products and to deceptive practices related to tax return preparation payment services. The consent order assessed a civil money penalty in the amount of $44 million and required the institution to take various other corrective actions.7 Given the complexity of this area of supervision, the Federal Reserve seeks to provide transparency on its perspectives and processes to the industry and the public. Fair Lending and UDAP Enforcement staff meet with supervised institutions, consumer advocates, and industry represen- 6 For additional information on the standards used by the Federal Reserve when enforcing the FTC Act prohibition on unfair or deceptive acts and practices, see Board of Governors of the Federal Reserve System & Federal Deposit Insurance Corp., Unfair or Deceptive Acts or Practices by State-Chartered Banks (Mar. 11, 2004), available at https://www.federalreserve.gov/boarddocs/caletters/2004/0402/CA04-2Attach.pdf. 7 For more information, see announcement at https://www.federalreserve.gov/newsevents/pressreleases/ enforcement20240719b.htm.

80 111th Annual Report | 2024 tatives to discuss fair lending and UDAP issues and receive feedback. Through this outreach, the Board can address emerging fair lending and UDAP issues and promote sound fair lending and UDAP compliance. This includes staff participation in numerous meetings, conferences, and training events. The Federal Reserve’s outreach included the annual Board-sponsored Fair Lending Interagency Webinar, which attracted more than 7,200 registrants in 2024. See box 6.1 for more information about fair lending topics covered at the event.8 Flood Insurance Enforcement The National Flood Insurance Act imposes certain requirements on loans secured by buildings or mobile homes located in, or to be located in, areas determined to have special flood hazards. Under the Federal Reserve’s Regulation H, which implements the act, state member banks are generally prohibited from making, extending, increasing, or renewing any such loan unless the building or mobile home, as well as any personal property securing the loan, are covered by flood insurance for the term of the loan. The law requires the Board and other federal financial institution regulatory agencies to impose civil money penalties when they find a pattern or practice of violations of the regulation. In 2024, the Federal Reserve issued four orders, assessing approximately $115,400 in civil money penalties against four state member banks to address flood insurance regulatory violations.9 Mergers and Acquisitions The Board is required by law to consider specific factors when evaluating proposed mergers and acquisitions, including competitive considerations, financial condition, managerial resources (including compliance with laws and regulations), convenience and needs of the community to be served (including the record of performance under the CRA), and financial stability. In evaluating bank applications, the Federal Reserve relies on the banks’ overall compliance record, including recent fair lending examinations. In addition, the Federal Reserve considers the CRA records of the relevant depository institutions, assessments of other relevant supervisors, the supervisory views of examiners, and information provided by the applicant and public commenters. If warranted, the Federal Reserve will also conduct pre-membership exams for a transac- 8 To view the webinar, see https://consumercomplianceoutlook.org/outlook-live/archives/. 9 To view press releases for enforcement actions, see https://www.federalreserve.gov/newsevents/pressreleases.htm.

Consumer and Community Affairs 81 Box 6.1. Supporting Financial Inclusion through Consumer Protection, Research, and Community Development Throughout 2024, the Board’s Division of Consumer and Community Affairs (DCCA) worked to foster an inclusive financial system that enables consumers’ access to banking products and services. DCCA’s publications, research, and outreach offered insight into economic circumstances and on key consumer topics, including food and childcare costs, housing, and broadband access in rural and underserved communities. Furthermore, DCCA developed a guide for community banks to help them manage risks of working with third parties and guidance to help prevent elder financial exploitation and on other topics related to consumer protection. Conducting Innovative Research As some households faced high prices and other challenges in managing their finances, DCCA’s research and policy analysis offered multifaceted perspectives on how families and communities were faring. Released in May, the Economic Well-Being of U.S. Households in 2023 report analyzed responses to the annual Survey of Household Economics and Decisionmaking (SHED) fielded in fall 2023. The survey included questions about overall financial well-being, emergency expenses, the labor market, inflation experiences, housing situations, and retirement savings, as well as about new topics including food sufficiency and caregiving.1Board staff led a Connecting Communities webinar to share the SHED findings.2DCCA economists also published papers on a range of topics including financial literacy, job changes, income growth, higher education, ways to measure poverty geographically, use of Buy Now, Pay Later (BNPL) products, and other factors affecting consumers’ financial resiliency.3 In addition to broad measures of financial well-being, DCCA’s policy analysis initiatives provided insight into rural economic and community development, including broadband access and job opportunities. A Consumer & Community Context issue released in July examined the importance of internet connectivity and digital skills for participating in the economy and how lack of access to broadband affects underserved communities.4Other articles by DCCA staff explored differences in rural and urban employment.5 Promoting Sound Risk-Management Practices and Consumer Education among Banks DCCA’s consumer protection and supervision initiatives prioritized both effective risk-management strategies for financial institutions and broadening awareness of payment fraud and scams. In collaboration with other financial regulatory agencies, the Board released Third-Party Risk Management: A Guide for Community Banks. Issued in May, the guide offers potential resources, considerations, and examples (continued) 1 See https://www.federalreserve.gov/consumerscommunities/shed.htm. 2 See https://fedcommunities.org/connecting-communities-economic-well-being-us-households-2023/. 3 See https://www.federalreserve.gov/econres/notes/feds-notes/default.htm and https://www.federalreserve.gov/econres/feds/ index.htm for more information. 4 See https://www.federalreserve.gov/publications/consumer-community-context.htm. 5 See Andrew Dumont, “Changes in the U.S. Economy and Rural-Urban Employment Disparities,” FEDS Notes (Washington: Board of Governors of the Federal Reserve System, January 19, 2024), https://doi.org/10.17016/2380-7172.3428, and Andrew Dumont, “Rural Employment Disparities by Race, Ethnicity, and Region,” FEDS Notes (Washington: Board of Governors of the Federal Reserve System, May 31, 2024), https://doi.org/10.17016/2380-7172.3510.

82 111th Annual Report | 2024 Box 6.1—continued for community banks partnering with third-party vendors that provide access to new technologies, delivery channels, products, and markets.6To support responsible innovation further, the Board also released an interagency statement noting examples of risk-management practices banks can use for third-party relationships that deliver bank deposit products and services to end users.7At the 2024 Fair Lending Interagency Webinar, DCCA and other federal supervisory and enforcement agencies focused on topics including strategies to identify and mitigate redlining risk in delineating assessment areas, marketing, and outreach and enforcement of the Home Mortgage Disclosure Act.8 In addition to providing responsive insights on emerging issues, the Board also shared resources to help consumers and financial institutions identify, prevent, and respond to financial fraud. In December, the Board and other financial regulatory agencies issued an interagency statement to assist financial institutions in combatting elder financial exploitation. The statement outlined strategies including governance and oversight, employee training, and consumer outreach and awareness, as well as ways to engage with elder abuse prevention networks and report financial exploitation to authorities, as appropriate.9 Exploring Issues Affecting Consumers and Communities through Events and Outreach The Board’s events and outreach efforts focused on understanding growth in financially inclusive products and practices and on how post-pandemic economic conditions have shaped the economy and workforce. In July, DCCA co-hosted the Financial Inclusion Practices and Innovations conference with the Divisions of Reserve Bank Operations and Payment Systems and Supervision and Regulation. The conference considered a range of topics and opportunities to advance financial inclusion, including how small-dollar loans, the use of alternative data for cash-flow underwriting, payment services, and other emerging products and practices may expand consumers’ access to financial services.10In March, the Board also convened Fed Listens: Transitioning to the Post-Pandemic Economy, with community development practitioners, economists, and other thought leaders discussing evolving conditions for families and job seekers.11Governor Michelle W. Bowman participated in a subsequent Fed Listens event about childcare and working parents at the Federal Reserve Bank of Chicago.12 Further outreach initiatives helped DCCA gain insight into the effects of current economic conditions on lower-income households and communities. At meetings in May and October, members of the Board’s Community Advisory Council offered perspectives on how trends in small business and consumer lending, housing supply, and childcare availability were affecting their respective regions.13 6 See SR letter 24-2/CA letter 24-1, “Third-Party Risk Management: A Guide for Community Banks,” https://www.federalreserve.gov/ supervisionreg/srletters/SR2402.htm. The Board and other agencies released the guide as a complementary resource for June 2023 interagency guidance on managing third-party relationships to all banking organizations under the agencies’ supervisions. See CA letter 24-2, “Interagency Guidance on Third-Party Relationships: Risk Management,” https://www.federalreserve.gov/ supervisionreg/caletters/caltr2402.htm. 7 See CA letter 24-5, “Joint Statement on Banks’ Arrangements with Third Parties to Deliver Bank Deposit Products and Services,” https://www.federalreserve.gov/supervisionreg/caletters/caltr2405.htm. 8 See https://www.consumercomplianceoutlook.org/Outlook-Live/2024/2024-Fair-Lending-Interagency-Webinar/. 9 See SR letter 24-8/CA letter 24-6, “Interagency Statement on Elder Financial Exploitation,” https://www.federalreserve.gov/ supervisionreg/srletters/sr2408.htm. 10 See https://www.federalreserve.gov/conferences/financial-inclusion-practices-and-innovations.htm for more information about the conference. A video recording of the conference is available at https://www.youtube.com/watch?v=2jn3WXpHJew. 11 For the agenda and video recording of this event, see https://www.federalreserve.gov/conferences/fed-listens-transitioning-to-thepost-pandemic-economy-032024.htm. 12 See https://www.federalreserve.gov/fedlistens.htm. 13 See https://www.federalreserve.gov/aboutthefed/cac.htm.

Consumer and Community Affairs 83 tion in which an insured depository institution will become a state member bank or in which the surviving entity of a merger would be a state member bank.10 The Board provides information on its actions associated with these merger and acquisition transactions, issuing press releases and Board Orders for each.11The Federal Reserve also publishes semiannual reports that provide pertinent information on applications and notices filed with the Federal Reserve.12The reports include statistics on the number of proposals that were approved, denied, and withdrawn as well as general information about the length of time taken to process proposals. Additionally, the reports discuss common reasons that proposals have been withdrawn from consideration. Furthermore, the reports compare processing times for merger and acquisition proposals that received adverse public comments and those that did not. Coordination with Other Agencies Coordination with the Consumer Financial Protection Bureau During 2024, staff continued to coordinate on supervisory matters with the CFPB in accordance with the Interagency Memorandum of Understanding on Supervision Coordination. The agreement is intended to establish arrangements for coordination and cooperation among the CFPB and the Board of Governors, the Office of the Comptroller of the Currency (OCC), the Federal Deposit Insurance Corporation (FDIC), and the National Credit Union Association (NCUA). The agreement strives to minimize unnecessary regulatory burden and to avoid unnecessary duplication of effort and conflicting supervisory directives among the prudential regulators and the CFPB. The regulators work cooperatively to share exam schedules for covered institutions and covered activities to plan simultaneous exams, provide final drafts of examination reports for comment, and share supervisory information. Coordination with Other Federal Banking Agencies The Board regularly coordinates with other federal banking agencies, including through the development of interagency guidance, to clearly communicate supervisory expectations. The Federal Reserve also works with the other member agencies of the FFIEC to develop consistent examination principles, standards, procedures, and report formats.13In addition, the Federal Reserve participates in the Joint Task Force on Fair Lending, composed of all the prudential regulators, the 10The Federal Reserve has issued guidance providing further explanation on its criteria for waiving or conducting such premerger or pre-membership examinations. For more information, see https://www.federalreserve.gov/supervisionreg/ srletters/SR1511.htm. 11To access the Board’s Orders on Banking Applications, see https://www.federalreserve.gov/newsevents/ pressreleases.htm. 12For these reports, see https://www.federalreserve.gov/supervisionreg/semiannual-reports-banking-applicationsactivity.htm. 13For more information, see https://www.ffiec.gov/.

84 111th Annual Report | 2024 CFPB, the DOJ, the Federal Housing Finance Agency, the Federal Trade Commission, and the Department of Housing and Urban Development. In May 2024, the Board joined the FDIC and OCC in issuing a guide intended to assist community banks when developing and implementing their third-party risk management practices.14In July 2024, the Board, along with the CFPB, FDIC, NCUA, and OCC, adopted guidance on reconsiderations of residential real estate valuations, which described the risks of deficient valuations and provided examples of processes that financial institutions could incorporate into existing riskmanagement functions.15In August 2024, the Board joined the FDIC and OCC in issuing a joint statement on banks’ arrangements with third parties to deliver bank deposit products and services, which noted potential risks related to these arrangements and highlighted examples of effective risk-management practices a bank may consider when participating in such arrangements.16Finally, in December 2024, the Board, along with the CFPB, FDIC, NCUA, OCC, state financial regulators, and the Financial Crimes Enforcement Network (FinCEN), issued a statement to financial institutions for the purpose of raising awareness and providing strategies for combatting elder financial exploitation.17See box 6.1 for more information about the Board’s coordination with other federal regulators to promote sound risk-management practices and consumer education. Outreach The Federal Reserve maintains a comprehensive public outreach program to promote consumer protection, financial inclusion, and community reinvestment. During 2024, the Board continued to enhance its program, delivering timely, relevant compliance information to the banking industry, experienced examiners, and other regulatory personnel. In 2024, three issues of Consumer Compliance Outlookwere released, discussing regulatory and supervisory topics of interest to compliance professionals.18This publication is distributed to state member banks as well as to BHCs and savings and loan holding companies supervised by the Federal Reserve, among other subscribers. In addition, the Federal Reserve offered two Outlook Live seminars: the 2024 Fair Lending Interagency Webinar and a Compliance Resources webinar for bankers.19See box 6.1 for more information about the Fair Lending Interagency Webinar and other Board events. 14See https://www.federalreserve.gov/supervisionreg/srletters/SR2402.htm. 15See https://www.federalreserve.gov/supervisionreg/srletters/SR2403.htm. 16See https://www.federalreserve.gov/supervisionreg/caletters/caltr2405.htm. 17See https://www.federalreserve.gov/supervisionreg/srletters/sr2408.htm. 18See https://www.consumercomplianceoutlook.org/2023/second-third-issue/top-compliance-violations/. 19For more information and to access the webinar, see https://consumercomplianceoutlook.org/outlook-live/archives/.

Consumer and Community Affairs 85 Examiner Training The Federal Reserve’s Examiner Training program supports the ongoing professional development of consumer compliance supervisory staff, from an initial introduction to the Federal Reserve System through the development of proficiency in consumer compliance topics sufficient to earn an examiner’s commission and beyond. The goal of these efforts is to ensure that examiners have the skills necessary to meet their supervisory responsibilities now and in the future. Consumer Compliance Examiner Commissioning Program The Consumer Compliance Examiner Commissioning Program is designed to provide an examiner with (1) a foundation for supervision in the Federal Reserve System and (2) the skills necessary to effectively perform examiner-in-charge responsibilities at a noncomplex community bank.20On average, examiners progress through a combination of self-paced online learning, classroom offerings, virtual instruction, and on-the-job training over a period of two to three years. Achievement is measured by completing the required course content, demonstrating adequate on-the-job knowledge, and passing a professionally validated proficiency examination. In 2024, 11 examiners passed the Consumer Compliance Proficiency Examination. The combination of multiple training delivery channels offers learners and Reserve Banks an ability to customize learning and meet training demands more individually and cost effectively. Continuing Professional Development In addition to providing core examiner training, continuing, career-long learning is offered across the Federal Reserve System. Opportunities for continuing professional development (CPD) include online learning modules, special projects and assignments, self-study programs, rotational assignments, instruction at System courses, mentoring programs, and the Consumer Compliance Senior Forum held every 18 months. Staff have access to CPD resources on a variety of topics, including learning assets for examiners moving into examiner responsibilities at larger financial institutions and other curated learning content. In 2024, the System continued to offer Rapid Response and similar sessions to provide timely training to examiners through webinars and case studies on emerging issues or to address urgent training needs that result from, for example, the implementation of new laws or regulations. Four Rapid Response sessions with an exclusive consumer compliance focus were designed, developed, and presented to System staff during 2024. An additional 24 CPD offerings were delivered that addressed a broader range of supervisory issues, including consumer compliance topics. 20An overview of the Federal Reserve System’s Examiner Commissioning Program for assistant examiners is set forth in supervision and regulation (SR) letter 17-6/CA 17-1, “Overview of the Federal Reserve’s Supervisory Education Programs.” See https://www.federalreserve.gov/supervisionreg/srletters/sr1706.htm.

86 111th Annual Report | 2024 Responding to Consumer Complaints and Inquiries The Federal Reserve investigates complaints against state member banks and selected nonbank subsidiaries of BHCs (Federal Reserve–regulated entities), and forwards complaints against other creditors and businesses to the agency with relevant authority. Each Reserve Bank investigates complaints against Federal Reserve–regulated entities in its District. The Federal Reserve also responds to consumer inquiries on a broad range of banking topics, including consumer protection questions. Federal Reserve Consumer Help (FRCH) processes consumer complaints and inquiries centrally. In 2024, FRCH processed 34,198 cases. Of these cases, 17,237 were inquiries and the remainder (16,961) were complaints, with most cases received directly from consumers and involving financial institutions other than state member banks supervised by the Federal Reserve. Approximately 22 percent of cases were referred to the Federal Reserve from other federal and state agencies. Consumers contacted FRCH by a variety of different channels: 49 percent of the FRCH consumer contacts occurred by telephone, and 49 percent of complaint and inquiry submissions were made electronically (via email, online submissions, and fax). The online form page received 46,356 visits during the year. Consumer Complaints Complaints against Federal Reserve–regulated entities totaled 9,700 in 2024. Of the total, 74 percent (7,219) were closed, and 26 percent were still under investigation as of January 24, 2025. Less than 1 percent (56) of the closed complaints were pending the receipt of additional information from consumers, referred to another regulatory agency, or withdrawn by the consumer. Complaints about Products and Practices During 2024, the Federal Reserve monitored consumer complaints by product and common subjects of complaint (see table 6.1). The Board also tracked complaints that cite discrimination. Ten complaints alleging credit discrimination based on prohibited borrower traits or rights were received in 2024. Five discrimination complaints were related to the race, color, national origin, or ethnicity of the applicant or borrower. Two discrimination complaints were related to either the age or sex of the applicant or borrower. The remainder were related to handicap. Of the closed complaints alleging credit discrimination based on a prohibited basis in 2024, five found no violation, one was referred internally, and another involved a matter in litigation/arbitration.

Consumer and Community Affairs 87 Table 6.1. Complaints against state member banks and selected nonbank subsidiaries of bank holding companies by product and subject of complaint, 2024 Product/subject of complaint Percent Deposit/bank products 57 Restricted/blocked accounts 25 Fraud/forgery 9 Deposit error resolution 8 Funds availability not as expected 8 Other 7 Prepaid accounts 25 Restricted/blocked accounts 16 Error resolution 3 Fraud/forgery 3 Inability to withdraw funds on the card 2 Other 1 Credit card accounts 14 Inaccurate credit reporting 5 Fraud/forgery 4 Request to validate the debt owed 1 Other 4 Nondeposit & bank services 2 Other products 1 Real estate loans 1 Total complaints across categories 100 Note: Other products include commercial products, nondeposit products, vehicle loans, customer service, and bank services. Real estate loans include adjustable-rate mortgages, residential construction loans, open-end home equity lines of credit, home improvement loans, home purchase loans, home refinance/closed-end loans, and reverse mortgages. Of the total investigated complaints against Federal Reserve–regulated entities, 82 percent did not reveal an error or violation; 7 percent were deemed regulatory concerns or violations of law; 11 percent were identified errors that were corrected by the bank; and the remainder included matters involving litigation, externally and internally referred complaints, complaints resolved by the bank after the consumer filed the complaint with FRCH, or information was provided to the consumer. Consumer Laws and Regulations Throughout 2024, the Board continued to administer its regulatory responsibilities with respect to certain entities and specific statutory provisions of the consumer financial services and fair lending laws. This included drafting regulations and issuing compliance guidance for the industry

88 111th Annual Report | 2024 and the Reserve Banks and fulfilling its role in consulting with the CFPB on consumer financial services and fair lending regulations for which the CFPB has rulemaking responsibility. Updating Annual Indices for Consumer Regulations Annual Indexing of Exempt Consumer Credit and Lease Transactions In October 2024, the Board and the CFPB announced that the dollar thresholds in Regulation Z (Truth in Lending) and Regulation M (Consumer Leasing) that will apply in 2025 for determining exempt consumer credit and lease transactions will increase from $69,500 in 2024 to $71,900 for 2025. These thresholds are set pursuant to statutory changes enacted by the Dodd-Frank Act that require adjusting these thresholds annually based on the annual percentage increase in the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W). Transactions at or below the thresholds are subject to the protections of the regulations.21 Annual Indexing of Threshold for Small Loan Exemption from Appraisal Requirements for Higher-Priced Mortgage Loans In October 2024, the Board, the CFPB, and the OCC announced that the threshold for exempting loans from special appraisal requirements for higher-priced mortgage loans would increase from $32,400 for 2024 to $33,500 for 2025.22The Dodd-Frank Act amended TILA to add special appraisal requirements for higher-priced mortgage loans, including a requirement that creditors obtain a written appraisal based on a physical visit to the home’s interior before making a higherpriced mortgage loan. The rules implementing these requirements contain an exemption for loans of $25,000 or less and also provide that the exemption threshold will be adjusted annually to reflect increases in the CPI-W. Annual Adjustment to Community Reinvestment Act Asset-Size Thresholds for Small and Intermediate Small Banks In December 2024, the Board and the FDIC announced the annual adjustment to the asset-size thresholds used to define small bankand intermediate small bankunder the CRA regulations.23 Financial institutions are evaluated under different CRA examination procedures based on their asset-size classification. Those meeting the small and intermediate small bank asset-size thresh- 21For more information, see “Agencies Announce Dollar Thresholds for Applicability of Truth in Lending and Consumer Leasing Rules for Consumer Credit and Lease Transactions,” press release, October 4, 2024, https://www.federalreserve.gov/newsevents/pressreleases/bcreg20241004b.htm. 22For more information, see “Agencies Announce Dollar Thresholds for Smaller Loan Exemption from Appraisal Requirements for Higher-Priced Mortgage Loans,” press release, October 4, 2024, https://www.federalreserve.gov/ newsevents/pressreleases/bcreg20241004a.htm. 23For more information, see “Agencies Release Annual Asset-Size Thresholds under Community Reinvestment Act Regulations,” press release, December 19, 2024, https://www.federalreserve.gov/newsevents/pressreleases/ bcreg20241219a.htm.

Consumer and Community Affairs 89 olds are not subject to the reporting requirements applicable to large banks unless they choose to be evaluated as a large bank. Annual adjustments to these asset-size thresholds are based on the change in the average of the CPI-W, not seasonally adjusted, for each 12-month period ending in November, with rounding to the nearest million. As a result of the 2.91 percent increase in the CPI-W for the period ending in November 2024, the definitions of small bank and intermediate small bank for CRA examinations were changed as follows: • Small bankmeans a bank that, as of December 31 of either of the prior two calendar years, had assets of less than $1.609 billion. • Intermediate small bankmeans a small bank with assets of at least $402 million as of December 31 of both of the prior two calendar years and less than $1.609 billion as of December 31 of either of the prior two calendar years. These asset-size threshold adjustments took effect on January 1, 2025. Consumer Research and Analysis of Emerging Issues and Policy Throughout 2024, the Board analyzed emerging issues in consumer financial services practices in order to understand their implications for consumers and the Federal Reserve’s responsibilities. Researching Issues Affecting Consumers and Communities In 2024, the Board explored various issues related to consumers and communities by convening experts, conducting original research, and fielding surveys as part of its continuing commitment to gain insights into consumers’ financial and communities’ economic development experiences. This work was essential to identifying emerging issues and understanding how consumers have responded to economic challenges. Household Economics and Decisionmaking The Board conducts an annual survey of consumers to gather data on their experiences and perspectives through the Survey of Household Economics and Decisionmaking (SHED). The SHED collects information to better understand household financial activity and perceptions.

90 111th Annual Report | 2024 Results of the Board’s 10th annual SHED were published in the Economic Well-Being of U.S. Households in 2023 report, released in May 2024.24The survey results reflected the self-reported financial conditions of over 11,000 respondents at the end of 2023. The survey asked respondents about specific aspects of their financial lives, including: • employment • expenses and experiences with inflation • income and savings • economic preparedness • banking and credit • housing and living arrangements • higher education and student loans • retirement The 2023 survey found that despite the moderating pace of inflation, many adults continued to indicate that higher prices were a challenge in managing their finances. Both the share of adults who spent less than their income in the month before the survey and the share who would pay for an unexpected $400 expenses with cash or the equivalent were nearly unchanged from 2022, yet both were down from 2021. Additionally, the rates at which workers started new jobs and received pay raises were consistent with those seen a year earlier. The report also highlights several new and expanded topics in the 2023 survey, including caregiving responsibilities, food sufficiency, and homeowners’ insurance. These new questions provide additional context on the experiences of U.S. adults across various dimensions of their financial lives. Additionally, the report continued to include information on emerging financial products, including cryptocurrencies and “Buy Now, Pay Later” products. The survey and report also provided insights into long-standing issues related to individuals’ personal financial circumstances, including returns to education, housing situations, and retirement savings. The survey found that differences by education, race and ethnicity, and income generally persisted in 2023. In addition to fielding and analyzing these surveys, researchers in the Division of Consumer and Community Affairs published articles throughout the year in various publications and journals, contributing to a body of research exploring issues affecting consumers and communities. In 2023, 24For the report and related data from the Survey of Household Economics and Decisionmaking, see https://www.federalreserve.gov/consumerscommunities/shed.htm.

Consumer and Community Affairs 91 research staff published 15 working papers and notes in the Board’s Finance and Economics Discussion Series, had 3 papers accepted for publication at economics journals, and released several additional working papers in other working paper series.25See box 6.1 for more insight into Board research publications. Analysis of Emerging Issues Board staff analyze data and anticipate trends, monitor policy developments, form working groups, and organize expert roundtables to identify emerging consumer risks and inform supervision, research, and policy. In 2024, the Board analyzed a broad range of issues in financial services markets that potentially pose risks to consumers. Topics of interest included • the implications of increased use of generative artificial intelligence for consumers, • understanding the effects of inflation on low-income families, • tracking housing trends, and • monitoring credit trends for small businesses. In July, DCCA co-hosted the Financial Inclusion Practices and Innovations conference in partnership with the Divisions of Supervision and Regulation and Reserve Bank Operations and Payments Systems.26The conference was livestreamed on the Federal Reserve Board’s YouTube channel and considered a range of topics and opportunities to advance financial inclusion, including how small-dollar loans, the use of alternative data for cash-flow underwriting, payment services, and other emerging products and practices may expand consumers’ access to financial services. The Board also convened a consumer risk-focused workshop series for staff from the Board, Reserve Banks, and other federal agencies in September. The discussion considered a range of responses and actions aimed at addressing and preventing consumer payments fraud. In addition, subject matter experts published a new issue of the Board’s Consumer & Community Contextarticle series examining the availability of broadband, devices, and digital skills and their effects on communities.27See box 6.1 for more information about Consumer & Community Contextand Board events. 25See https://www.federalreserve.gov/econres/notes/feds-notes/default.htm and https://www.federalreserve.gov/ econres/feds/index.htm for more information. 26See https://www.federalreserve.gov/conferences/financial-inclusion-practices-and-innovations.htm for the agenda and https://www.youtube.com/watch?v=2jn3WXpHJew for the video replay of the conference. 27See “Expanding America’s Bandwidth: Gaps in Rural and Underserved Communities,” https://www.federalreserve.gov/ publications/files/consumer-community-context-20240715.pdf. For more information about Consumer & Community Context, see https://www.federalreserve.gov/publications/consumer-community-context.htm.

92 111th Annual Report | 2024 Community Development The Federal Reserve System’s community development function promotes economic growth and financial stability for underserved households and communities through research and public outreach. Community development is largely a decentralized function within the Federal Reserve System, and the Community Affairs Officers at each of the 12 Reserve Banks design strategies to respond to the specific needs and interests of community development stakeholders in their respective Districts. Board staff provide oversight for alignment with Board objectives and coordination of System priorities. Understanding Outcomes in the Labor Market The community development function works to ensure that the perspectives of consumers and communities inform policy and research and solicits a broad range of views on issues affecting the economy and financial markets. These insights help improve research, policies, and transparency. In 2024, the Board’s community development initiatives explored multiple aspects of workforce development. In February, the Board and the Federal Reserve Banks of Atlanta, Boston, Cleveland, Philadelphia, and St. Louis convened the Uneven Outcomes in the Labor Market conference.28The conference’s four sessions focused on topics including economic returns on educational investment, labor force participation decisions, employer characteristics such as structure and financing, and federal, state, and local employment policies. Board staff analyzed long-term shifts in the economy and their relationship to employment rates across urban and rural communities as well as differences between demographic groups and regions.29In addition to monitoring the impact of economic outcomes, the Federal Reserve participated in efforts to support the viability of minority depository institutions (MDIs), women depository institutions (WDIs), and community development financial institutions (CDFIs) as required by statute. During the semiannual Community Advisory Council (CAC) meetings, the Council discussed ongoing credit and economic conditions in regional housing, small business, and labor markets. Council members noted disaster and recovery impacts across their communities, such as the Maui wildfires. They also shared their perspectives on the effect of costs related to property, commercial, auto, and health insurance on low- and moderate-income household budgets.30 28See https://fedcommunities.org/uneven-outcomes-labor-market-conference/ for agendas and video replays of each session. 29See https://www.federalreserve.gov/econres/notes/feds-notes/changes-in-the-us-economy-and-rural-urbanemployment-disparities-20240119.html. And see https://www.federalreserve.gov/econres/notes/feds-notes/ruralemployment-disparities-by-race-ethnicity-and-region-20240531.html. 30Records of the meetings of the CAC are available at https://www.federalreserve.gov/aboutthefed/cac.htm.

Appendixes

95 A Federal Reserve System Organization Congress designed the Federal Reserve System to give it a broad perspective on the economy and on economic activity in all parts of the nation. As such, the System is composed of a central, governmental agency—the Board of Governors—in Washington, D.C., and 12 regional Federal Reserve Banks. This section lists key officials across the System, including the Board of Governors, its officers, Federal Open Market Committee members, several System councils, and Federal Reserve Bank and Branch directors and officers for 2024. Board of Governors Members The Board of Governors of the Federal Reserve System is composed of seven members, who are nominated by the President and confirmed by the Senate. The Chair and the Vice Chair of the Board are named by the President from among the members and are confirmed by the Senate. This section lists Board members who served in 2024. For a full list of Board members from 1914 through the present, see www.federalreserve.gov/aboutthefed/bios/board/boardmembership.htm. Jerome H. Powell Michael S. Barr Lisa D. Cook Chair Vice Chair for Supervision Adriana D. Kugler Philip N. Jefferson Michelle W. Bowman Christopher J. Waller Vice Chair Divisions and Officers Fifteen divisions support and carry out the mission of the Board of Governors, which is based in Washington, D.C. Division of Board Members Michelle A. Smith Terrence E. Fischer Kirk O. Schwarzbach Assistant to the Board Special Assistant to the Board Special Assistant to the Board and Director for Public Information (as of April 7, 2024) Jennifer C. Gallagher Eric J. Kollig Jon Faust Assistant to the Board Special Assistant to the Board Senior Special Adviser (as of April 7, 2024) to the Chair (through February 29, 2024)

96 111th Annual Report | 2024 Legal Division Mark E. Van Der Weide Alicia S. Foster Dafina V. Stewart General Counsel Associate General Counsel Deputy Associate General Counsel Jean C. Anderson Sean D. Croston Deputy General Counsel Deputy Associate General Counsel Evan H. Winerman Deputy Associate Richard M. Ashton Jason A. Gonzalez General Counsel Deputy General Counsel Deputy Associate General Counsel Joshua P. Chadwick Charles C. Gray Assistant General Counsel (as of Deputy General Counsel (through Asad L. Kudiya November 3, 2024) August 9, 2024) Deputy Associate General Counsel Lucy O. Chang Reena Sahni Assistant General Counsel Deputy General Counsel Jay R. Schwartz Deputy Associate Michelle A. Kapoor Alvin D. Williams General Counsel Assistant General Counsel (as of Senior Associate November 3, 2024) General Counsel Office of the Secretary Ann Misback Michele T. Fennell Benjamin W. McDonough Secretary of the Board Associate Secretary Deputy Secretary and Ombuds (as of April 8, 2024) Yao-Chin Chao Erin M. Cayce Deputy Associate Secretary Assistant Secretary Division of International Finance Beth Anne Wilson Daniel Beltran Deepa Datta Director Deputy Associate Director Assistant Director Shaghil Ahmed Jennifer S. Crystal Andrea Pastore Deputy Director Deputy Associate Director Assistant Director (as of June 24, 2024) Stephanie E. Curcuru Brett D. Berger Deputy Director Andrea De Michelis Senior Adviser Deputy Associate Director Brian M. Doyle Carol C. Bertaut Deputy Director Jasper J. Hoek Senior Adviser Deputy Associate Director James A. Dahl Ricardo Correa Senior Associate Director Viktors Stebunovs Senior Adviser Deputy Associate Director Etienne Gagnon Paul R. Wood Senior Associate Director Emre Yoldas Senior Adviser Deputy Associate Director Luca Guerrieri Dario Caldara Senior Associate Director Martin R. Bodenstein Adviser Assistant Director Matteo Iacoviello Senior Associate Director

Federal Reserve System Organization 97 Division of Financial Stability Andreas W. Lehnert Skander J. Van den Heuvel Jacque J. Hightower Director Associate Director Assistant Director (as of June 3, 2024) Michael T. Kiley David Arseneau Deputy Director Deputy Associate Director Alfonso Ventoso Assistant Director William F. Bassett Ceyhun Durdu Senior Associate Director Deputy Associate Director Adele Cecile Morris Senior Adviser Elizabeth C. Klee Seung Jung Lee Senior Associate Director Deputy Associate Director Todd Vermilyea Senior Adviser Namirembe E. Mukasa Jose Berrospide Associate Director and Assistant Director Andrew M. Cohen Chief of Staff Adviser Fang Cai Assistant Director Division of Monetary Affairs Trevor A. Reeve Christopher J. Gust Benjamin Johannsen Director Associate Director Assistant Director James A. Clouse Brian Bonis Keith Kudrycki Deputy Director Deputy Associate Director Assistant Director Nelly Ramdass Karen L. Brooks Rochelle M. Edge Deputy Director Deputy Associate Director Senior Adviser Joshua Gallin Giovanni Favara Jane E. Ihrig Secretary of the FOMC Deputy Associate Director Senior Adviser David H. Bowman Dan Li Don H. Kim Senior Associate Director Deputy Associate Director Senior Adviser Margaret G. DeBoer Laura Lipscomb Edward M. Nelson Senior Associate Director Deputy Associate Director Senior Adviser J. David Lopez-Salido Elizabeth L. Marx Robert J. Tetlow Senior Associate Director Deputy Associate Director Senior Adviser Matthew M. Luecke Andrew C. Meldrum Annette Vissing-Jorgensen Senior Associate Director Deputy Associate Director Senior Adviser Katherine Sickbert Zeynep Senyuz Mark A. Carlson Senior Associate Director Deputy Associate Director Adviser Min Wei Rebecca E. Zarutskie Kurt F. Lewis Senior Associate Director Deputy Associate Director (through Adviser (as of August 11, 2024) August 23, 2024) Eric C. Engstrom Associate Director

98 111th Annual Report | 2024 Division of Research and Statistics Stacey Tevlin Timothy A. Mullen Jacob Gramlich Director Associate Director Assistant Director Jeffrey C. Campione Shane M. Sherlund Karen Krugman Deputy Director Associate Director Assistant Director Daniel M. Covitz Shawn M. Buckner Christopher J. Kurz Deputy Director Deputy Associate Director Assistant Director William L. Wascher III Erik A. Heitfield Geng Li Deputy Director Deputy Associate Director Assistant Director Stephanie Aaronson Byron F. Lutz Kevin B. Moore Senior Associate Director Deputy Associate Director Assistant Director Nicole E. Bennett Patrick E. McCabe Matthias Paustian Senior Associate Director Deputy Associate Director Assistant Director Eric M. Engen Raven S. Molloy Ekaterina Peneva Senior Associate Director Deputy Associate Director Assistant Director and Chief Diana Hancock Paul A. Lengermann Charles Fleischman Senior Associate Director Deputy Associate Director Senior Adviser Elizabeth K. Kiser Karen M. Pence S. Wayne Passmore Senior Associate Director Deputy Associate Director Senior Adviser (through September 30, 2024) David E. Lebow Paul A. Smith Senior Associate Director Deputy Associate Director Jeremy Rudd Senior Adviser Michael G. Palumbo Gustavo Suarez Senior Associate Director Deputy Associate Director Steven A. Sharpe Senior Adviser (through July 31, 2024) John J. Stevens Binoy K. Agarwal Senior Associate Director Assistant Director and Chief Clara Vega Senior Adviser Burcu Duygan-Bump Giovanni G. Amisano Associate Director Assistant Director Wendy E. Dunn Adviser J. Andrew Figura Celso Brunetti Associate Director Assistant Director Glenn R. Follette Marco Cagetti Associate Director Assistant Director Norman J. Morin Deborah M. Flores Associate Director Assistant Director

Federal Reserve System Organization 99 Division of Supervision and Regulation Michael S. Gibson Uzma Wahhab Steven M. Spurry Director Associate Director Deputy Associate Director Jennifer J. Burns John Beebe Catherine A. Tilford Deputy Director Deputy Associate Director Deputy Associate Director Kate M. Fulton Dana L. Burnett Donna J. Webb Deputy Director Deputy Associate Director Deputy Associate Director (through March 31, 2024) Arthur W. Lindo Anthony B. Cain Deputy Director Deputy Associate Director Suzanne L. Williams Deputy Associate Director Mary L. Aiken Karen A. Caplan Senior Associate Director Deputy Associate Director Kathryn L. Ballintine Assistant Director Marta Chaffee Juan C. Climent Senior Associate Director Deputy Associate Director Joseph B. Cox Assistant Director Molly E. Mahar James Diggs Senior Associate Director Deputy Associate Director Stephen Curren Assistant Director Nathan Ragan Christine E. Graham Senior Associate Director Deputy Associate Director Kwayne Jennings Assistant Director Lisa H. Ryu Eric L. Kennedy Senior Associate Director Deputy Associate Director Elizabeth K. MacDonald Assistant Director Kevin M. Bertsch Ryan P. Lordos Associate Director (through Febru- Deputy Associate Director Doriana Ruffino ary 29, 2024) Assistant Director Lara K. Lylozian Christopher Finger Deputy Associate Director/ April C. Snyder Associate Director Chief Accountant Assistant Director Jeffery W. Gunther David K. Lynch Norah M. Barger Associate Director Deputy Associate Director Senior Adviser Anna L. Hewko T. Kirk Odegard Fang Du Associate Director Deputy Associate Director Adviser Kavita Jain Brent Richards William F. Treacy Associate Director Deputy Associate Director Adviser Richard A. Naylor II Vaishali D. Sack Associate Director Deputy Associate Director Robert F. Sarama Margaret A. Sherry Associate Director Deputy Associate Director (as of February 12, 2024) Division of Consumer and Community Affairs Eric S. Belsky David L. Newville David E. Buchholz Director Senior Associate Director Associate Director V. Nicole Bynum Benjamin K. Olson Angelyque Campbell Deputy Director Senior Associate Director Associate Director

100 111th Annual Report | 2024 Joseph A. Firschein Marisa A. Reid Susan Torzilli Associate Director Associate Director Assistant Director (as of May 5, 2024) Phyllis L. Harwell Caterina Petrucco-Littleton Associate Director Deputy Associate Director Drew D. Kohan Amy B. Henderson Associate Director Assistant Director Division of Reserve Bank Operations and Payment Systems Matthew J. Eichner Rebecca L. Royer Edward L. Anderson Director Associate Director (through Assistant Director April 30, 2024) Susan V. Foley Alyssa Arute Deputy Director Stuart E. Sperry Assistant Director (as of Associate Director July 14, 2024) Jennifer K. Liu Deputy Director Mouneer I. Ahmad Emily A. Caron Deputy Associate Director (as of Assistant Director Gregory L. Evans December 2, 2024) Senior Associate Director (through Doreen S. Chappell August 31, 2024) Sonja R. Danburg Assistant Director Deputy Associate Director Brian A. Lawler Sonia Irvine Senior Associate Director Michael V. Derry Assistant Director/Manager (as of Deputy Associate Director (as of July 14, 2024) Jennifer A. Lucier January 2, 2024) Senior Associate Director James D. Noonan Brian R. Gattoni Assistant Director David C. Mills Deputy Associate Director Senior Associate Director Krzysztof Wozniak Laura Howard Mayer Assistant Director and Chief (as of Jeffrey D. Walker Deputy Associate Director July 14, 2024) Senior Associate Director Caio P. Peixoto Kimberly A. Zaikov Mark D. Manuszak Deputy Associate Director Assistant Director (as of Novem- Associate Director ber 3, 2024) Ian C. Spear Casey H. Clark Deputy Associate Director Frederick L. Zevin Associate Director Assistant Director/Manager (as of Shannon Hulsandra July 14, 2024) Jason A. Hinkle Assistant Director/Manager Associate Director Travis D. Nesmith Assistant Director and Chief Office of the Chief Operating Officer Patrick J. McClanahan Sheila Clark Andrew Leonard Chief Operating Officer EEO Programs and OMWI Director Associate Director Katherine Tom Phillip C. Daher Pamela C. Harris Chief Data Officer Associate Director Deputy Associate Director

Federal Reserve System Organization 101 Division of Financial Management Ricardo Aguilera Monica Y. Manning Karen L. Vassallo Director and Chief Associate Director Associate Director (through Financial Officer (through May 31, 2024) Thomas Murphy July 31, 2024) Associate Director Kimberly Briggs Stephen J. Bernard Deputy Associate Director Jeffrey R. Peirce Deputy Director Associate Director Division of Management Winona Varnon Donna J. Butler Lewis Andrews Director Associate Director and Assistant Director Chief of Staff Kendra Gastright Stewart A. Carroll Deputy Director Donald C. Hayes Assistant Director Associate Director and Chief, LEU (as Tameika L. Pope Melissa M. Catterall of February 12, 2024) Deputy Director Assistant Director (as of Decemand Chief Human Capital Officer Timothy E. Markey ber 15, 2024) Associate Director Tara Tinsley-Pelitere Alfonso M. Dyson Deputy Director and Chief Technol- Stephen E. Pearson Assistant Director and ogy Officer Associate Director Assistant Chief, LEU Ann Buckingham Catherine Jack Leah Middleton Senior Associate Director Deputy Associate Director Assistant Director Reginald V. Roach Tim Ly Associate Director Deputy Associate Director Division of Information Technology Jeffrey M. Riedel Jonathan F. Shrier Brian Lester Director Associate Director Deputy Associate Director Stephen Olden Virginia M. Wall Scott Meyerle Deputy Director Associate Director Deputy Associate Director Kofi A. Sapong Edgar Wang Can Xuan Nguyen Deputy Director (through Febru- Associate Director Deputy Associate Director ary 29, 2024) Muazzam Ali Nischala N. Nimmakayala Deborah Prespare Deputy Associate Director Deputy Associate Director Senior Associate Director (as of November 18, 2024) Langston Shaw Sheryl Lynn Warren William K. Dennison Deputy Associate Director Senior Associate Director Deputy Associate Director Fred Vu Rajasekhar R. Yelisetty Tannaz Haddadi Deputy Associate Director Senior Associate Director Deputy Associate Director Arsema K. Dejene Charles B. Young Amy Kelley Assistant Director Senior Associate Director Deputy Associate Director (as of February 11, 2024)

102 111th Annual Report | 2024 Michelle L. Bagg Herman Ip Assistant Director Assistant Director Office of Inspector General Mark Bialek Stephen Carroll Khalid A. Hassan Inspector General Associate Inspector General Assistant Inspector General Fred Gibson Michael VanHuysen Jina Hwang Deputy Inspector General Associate Inspector General Assistant Inspector General Cynthia Gray Jason A. Derr Jacqueline M. Becker Deputy Associate Inspector General Assistant Inspector General Senior Adviser

Federal Reserve System Organization 103 Federal Open Market Committee The Federal Open Market Committee is made up of the seven members of the Board of Governors; the president of the Federal Reserve Bank of New York; and four of the remaining eleven Federal Reserve Bank presidents, who serve one-year terms on a rotating basis. During 2024, the Federal Open Market Committee held eight regularly scheduled meetings (see Appendix B, “Minutes of Federal Open Market Committee Meetings”). Members Jerome H. Powell Michelle W. Bowman Adriana D. Kugler Chair, Board of Governors Member, Board of Governors Member, Board of Governors John C. Williams Lisa D. Cook Loretta J. Mester Vice Chair, President, Member, Board of Governors Member, Federal Reserve Bank of Federal Reserve Bank of New York Cleveland (through June 30, 2024) Beth M. Hammack Thomas I. Barkin Member, Federal Reserve Bank of Christopher J. Waller President, Federal Reserve Bank Cleveland (as of August 21, 2024) Member, Board of Governors of Richmond Mary C. Daly Michael S. Barr President, Federal Reserve Bank of Member, Board of Governors San Francisco Raphael W. Bostic Philip N. Jefferson President, Federal Reserve Bank Member, Board of Governors of Atlanta Alternate Members Susan M. Collins Alberto G. Musalem Sushmita Shukla President, Federal Reserve Bank President, Federal Reserve Bank of First Vice President, Federal Reserve of Boston St. Louis Bank of New York Austan D. Goolsbee Jeffrey R. Schmid President, Federal Reserve Bank President, Federal Reserve Bank of of Chicago Kansas City

104 111th Annual Report | 2024 Officers Joshua Gallin Beth Anne Wilson Paula Tkac Secretary Economist Associate Economist Matthew M. Luecke Shaghil Ahmed William L. Wascher Deputy Secretary Associate Economist Associate Economist Brian J. Bonis Kartik B. Athreya Alexander L. Wolman Assistant Secretary Associate Economist Associate Economist Michelle A. Smith James A. Clouse Roberto Perli Assistant Secretary Associate Economist Manager, System Open Market Account Mark E. Van Der Weide Brian M. Doyle General Counsel Associate Economist Julie Ann Remache Deputy Manager, System Open Richard Ostrander Edward S. Knotek II Market Account Deputy General Counsel Associate Economist Charles C. Gray David E. Lebow Assistant General Counsel (through Associate Economist August 9, 2024) Sylvain Leduc Trevor A. Reeve Associate Economist Economist Stacey Tevlin Economist

Federal Reserve System Organization 105 Board of Governors Advisory Councils The Federal Reserve Board uses advisory committees in carrying out its varied responsibilities. To learn more, visit https://www.federalreserve.gov/aboutthefed/advisorydefault.htm. Federal Advisory Council The Federal Advisory Council—a statutory body established under the Federal Reserve Act— consults with and advises the Board of Governors on all matters within the Board’s jurisdiction. It is composed of one representative from each Federal Reserve District, chosen by the Reserve Bank in that District. The president and vice president of the council are selected from amongst council members. The Federal Reserve Act requires the council to meet in Washington, D.C., at least four times a year. In 2024, the council met on February 7–8, May 22–23, September 4–5, and December 4–5. The council met with the Board on February 8, May 23, September 5, and December 5, 2024. Members District 1 District 5 District 9 Robert F. Rivers William H. Rogers Jr. Andrew Cecere Chairman and Chief Executive Officer, Chairman and Chief Executive Officer, Chairman, President, and Chief Eastern Bank, Boston, MA Truist Financial Corp., Charlotte, NC Executive Officer, U.S. Bancorp, Minneapolis, MN District 2 District 6 District 10 Marianne Lakes John M. Turner Jr. CEO of Consumer & Community President and Chief Executive Officer, Jill Castilla Banking, JPMorgan Chase & Co., Regions Financial Corp., Birmingham, President and Chief Executive Officer, New York, NY AL Citizens Bank of Edmond, Edmond, OK District 3 District 7 District 11 Jeffrey M. Schweitzer Darrel Hackett David Zalman President and Chief Executive Officer, President and Chief Executive Officer, Senior Chairman and Chief Executive Univest Bank and Trust Co., BMO Financial Group, BMO Bank, Officer, Prosperity Bancshares/ Souderton, PA N.A., Chicago, IL Prosperity Bank, El Campo, TX District 4 District 8 District 12 William S. Demchak Jeffrey Ludwig Robert Harrison Chairman, President, and Chief President and Chief Executive Officer, Chairman, President and Chief Executive Officer, PNC Financial Midland States Bancorp., Inc., Executive Officer, First Hawaiian, Inc., Services Group, Pittsburgh, PA Effingham, IL Honolulu, HI

106 111th Annual Report | 2024 Officers Andrew Cecere Herb Taylor Luba Romanyuk President Secretary Deputy Secretary Jill Castilla Vice President Community Depository Institutions Advisory Council The Community Depository Institutions Advisory Council advises the Board of Governors on the economy, lending conditions, and other issues of interest to community depository institutions. Members are selected from among representatives of banks, thrift institutions, and credit unions who are serving on local advisory councils at the 12 Federal Reserve Banks. One member of each of the Reserve Bank councils serves on the Community Depository Institutions Advisory Council. The president and vice president are selected from amongst council members. The council usually meets with the Board twice a year in Washington, D.C. In 2024, the council met on April 11 and November 14. Members District 1 District 5 District 9 Anne P. Tangen Daniel P. Berry Dylan S. Clarkson President and Chief Executive Officer, President and Chief Executive Officer, President and Chief Executive Officer, BankFive, Fall River, MA Duke University Federal Credit Union, Pioneer Bank & Trust, Spearfish, SD Durham, NC District 2 District 10 District 6 James S. Vaccaro Kim DeVore Chair, President, and Chief Executive Tyler K. Clinch President and Chief Executive Officer, Officer, Manasquan Bank, Wall Chief Executive Officer and President, Jonah Bank of Wyoming, Casper, WY Township, NJ First Community Bank of East Tennessee, Kingsport, TN District 11 District 3 District 7 Byron K. Bexley Jeffrey A. Stopko Vice Chairman, American Bank, N.A., President and Chief Executive Officer, Ronald Justice Universal City, TX AmeriServ Financial Inc., Johnstown, President and Chief Executive Officer, PA The State Bank, Fenton, MI District 12 District 4 District 8 Catherine Ngo Board of Directors, Central Pacific Chuck Sulerzyski Luanne Cundiff Bank, Honolulu, HI Adviser, Peoples Bank, Marietta, OH President and Chief Executive Officer, First State Bank of St. Charles, St. Charles, MO

Federal Reserve System Organization 107 Officers Chuck Sulerzyski Kim DeVore President Vice President Community Advisory Council The Community Advisory Council was formed in 2015 to advise the Board of Governors on the economic circumstances and financial services needs of consumers and communities, with a particular focus on the concerns of low- and moderate-income populations. The council is composed of a diverse group of experts and representatives of consumer and community development organizations and interests, including from such fields as affordable housing, community and economic development, employment and labor, financial services and technology, small business, and asset and wealth building. One member of the council serves as its chair. The council first met with the Board in November 2015, and meets with the Board twice each year. In 2024, the council met with the Board on May 30 and October 10. Members Ivye Allen Michelle Ka’uhane Ceyl Prinster President (retired), Foundation for the Senior Vice President & Chief Impact President and CEO, Colorado Mid South, Jackson, MS Officer, Hawaii Community Foundation, Enterprise Fund, Denver, CO Honolulu, HI Carlos J. Contreras III Jose Quinonez President and CEO, Goodwill Renata B. Kowalczyk CEO, Mission Asset Fund, San Industries of San Antonio, CEO, Wilmington Alliance, Francisco, CA San Antonio, TX Wilmington, DE Eric Robertson Roberto Gallardo Megan Langley Executive Director, The Formanek Vice President for Engagement & Executive Director, Strengthen North Foundation, Memphis, TN Associate Professor, Agricultural Dakota, Souris, ND Bruce Schultz Economics, Purdue University, West Lafayette, IN Chan U. Lee Vice President, Community Develop- President and CEO, Devine & Gong, ment Banking Strategy, Gateway First Fearn Gupton Inc., Oakland, CA Bank, Tulsa, OK Rural Development Manager, South Christie McCravy Justin Slattery Carolina Department of Commerce, Columbia, SC Executive Director, Louisville Metro Executive Director, Belknap Economic Affordable Housing Trust Fund, Development Council, Laconia, NH Melanie Hogan Louisville, KY Executive Director, Linking Employment, Abilities, and Potential (LEAP), Cleveland, OH Officers Christie McCravy Carlos Contreras Chair Vice Chair

108 111th Annual Report | 2024 Model Validation Council The Model Validation Council was established in 2012 by the Board of Governors to provide expert and independent advice on its process to rigorously assess the models used in stress tests of banking institutions. The Dodd-Frank Wall Street Reform and Consumer Protection Act required the Federal Reserve to conduct annual stress tests of large bank holding companies and systemically important, nonbank financial institutions supervised by the Board. The Model Validation Council provides input on the Board’s efforts to assess the effectiveness of the models used in the stress tests. The council is intended to improve the quality of the Federal Reserve’s model assessment program and to strengthen the confidence in the integrity and independence of the program. Members George G. Pennacchi Gonzalo Maturana Arpit Gupta Professor, University of Illinois Associate Professor, Emory University Associate Professor, New York University Juliane Begenau Vivian W. Fang Associate Professor, Stanford Professor, Indiana University Haresh Sapra University Professor, University of Chicago Insurance Policy Advisory Committee The Insurance Policy Advisory Committee (IPAC) was established at the Board of Governors in 2018 by section 211(b) of the Economic Growth, Regulatory Relief, and Consumer Protection Act. The IPAC provides information, advice, and recommendations to the Board of Governors of the Federal Reserve on international insurance capital standards and other insurance issues. In 2024, the IPAC provided extensive advice to the Board on the negotiations related to the International Association of Insurance Supervisors’ (IAIS’s) insurance capital standard (ICS) leading up to its adoption. This advice included a report on scalars, an integral component of the U.S.developed aggregation method, and perspectives on potential outcomes of the negotiations. The IPAC also advised the Board on issues related to the affordability and availability of property insurance, including by researching different aspects of the insurance markets in five key states. Members Ralph Blanchard Elizabeth Brill Nick Gerhart Member, American Academy of Senior Vice President & CFO Executive Vice President and Chief Actuaries, Casualty Actuarial Society, Foundational Business, New York Life Innovation Officer, Homesteaders and International Actuarial Association Insurance Company Life Company

Federal Reserve System Organization 109 John Golden Peter Kochenburger Aaron Sarfatti Global Head of Insurance Regulation, Executive Director of Insurance Law Head of Institutional Business and Apollo Global Management LLM, Program Deputy Director of the Inforce and Chief Strategy Officer, Insurance Law Center, NAIC Funded Equitable Holdings Inc. Martin Hansen Consumer Liaison Representative, Senior Managing Director, Policy, University of Connecticut School of Kenneth Selzer Planning, & Strategy (retired), Law Board Member, Federal Crop Insurance American International Group, Inc. Corporation Julie Mix McPeak Robert Hartwig Dean Stamp Senior Vice President & General Clinical Associate Professor of Finance Counsel, Insurance, United Services Head of Capital Strategy and and Insurance & Director, Risk and Automobile Association Initiatives, Manulife Financial Uncertainty Management Center, University of South Carolina Alessandro Papa William D. Torchiana Executive Vice President, Chief Risk Partner, Sullivan & Cromwell LLP John Howard Officer, Pacific Life Andrew Vedder Vice Chairman, TIH Pooja Rahman Vice President – Enterprise Risk Steven Jackson Chief Risk Officer, Transamerica Management, Northwestern Mutual Assistant Director for Research, American Academy of Actuaries Kristin Ricci Sarah Williams Partner, Oliver Wyman Chief Risk Officer, Guardian Life Shweta Jhanji Insurance Company Senior Vice President and Treasurer, Ameriprise Financial

110 111th Annual Report | 2024 Federal Reserve Banks and Branches To carry out the day-to-day operations of the Federal Reserve System, the nation has been divided into 12 Federal Reserve Districts, each with a Reserve Bank. The majority of Reserve Banks also have at least one Branch. Reserve Bank and Branch Directors As required by the Federal Reserve Act, each Federal Reserve Bank is supervised by a ninemember board with three different classes of three directors each: Class A directors, who are nominated and elected by the member banks in that District to represent the stockholding banks; Class B directors, who are nominated and elected by the member banks to represent the public; and Class C directors, who are appointed by the Board of Governors to represent the public. Class B and Class C directors are selected with due, but not exclusive, consideration to the interests of agriculture, commerce, industry, services, labor, and consumers. Each Federal Reserve Bank Branch also has a board with either five or seven directors. A majority of the directors on each Branch board are appointed by the Federal Reserve Bank, with the remaining directors appointed by the Board of Governors. For more information on Reserve Bank and Branch directors, see https://www.federalreserve.gov/ aboutthefed/directors/about.htm. Reserve Bank and Branch directors are listed below. For each director, the class of directorship, the director’s principal place of business, and the expiration date of the director’s current term are shown. Also shown are maps that identify Federal Reserve Districts by their official number, city, and letter designation. For more information on the Federal Reserve indicator letters, see https://www.uscurrency.gov/denominations/bank-note-identifiers.

Federal Reserve System Organization 111 District 1–Boston Covers the states of Maine, Massachusetts, New Hampshire, Rhode Island, 1—A and Vermont; and all but Fairfield County in Connecticut. VT ME For more information on this District and to learn more about the Federal MA NH Reserve Bank of Boston’s operations, visit https://www.bostonfed.org. Information on economic conditions for this District can be found in the Federal RI CT Boston Reserve System’s Beige Book at https://www.federalreserve.gov/ monetarypolicy/beige-book-default.htm. Also find the Reserve Bank’s financial statements for 2024 at https://www.federalreserve.gov/aboutthefed/files/ bostonfinstmt2024.pdf. Class A Class B Class C Sushil K. Tuli, 2024 Lauren A. Smith, 2024 Corey Thomas,2024 Chairman and Chief Executive Officer, VP Strategic Portfolios, Robert Wood Chairman and Chief Executive Officer, Leader Bank, N.A., Arlington, MA Johnson Foundation, Boston, MA Rapid7, Inc., Boston, MA Ronald P. O’Hanley, 2025 Vacancy, 2025 Lizanne Kindler, 2025 Chairman and Chief Executive Officer, Executive Chair and Chief Executive Kimberly Sherman Stamler, State Street, Boston, MA Officer, KnitWell Group, Hingham, MA 2026 Jeanne A. Hulit, 2026 President, Related Beal, Boston, MA Roger W. Crandall, 2026 President and Chief Executive Officer, Chairman, President, and Chief Maine Community Bank, Bidd- Executive Officer, Massachusetts eford, ME Mutual Life Insurance Company, Springfield, MA

112 111th Annual Report | 2024 District 2–New York 2—B Covers the state of New York, Fairfield County in Connecticut, and 12 coun- NY ties in northern New Jersey, and serves the Commonwealth of Puerto Rico CT and the U.S. Virgin Islands. Puerto Rico For more information on this District and to learn more about the Federal NJ NY Reserve Bank of New York’s operations, visit https://www.newyorkfed.org/. Virgin Islands New York Information on economic conditions for this District can be found in the Federal Reserve System’s Beige Book at https://www.federalreserve.gov/ monetarypolicy/beige-book-default.htm. Also find the Reserve Bank’s financial statements for 2024 at https://www.federalreserve.gov/ aboutthefed/files/newyorkfinstmt2024.pdf. Class A Class B Class C René F. Jones, 2024 Scott Rechler, 2024 Vincent Alvarez, 2024 Chairman and Chief Executive Officer, Chairman and Chief Executive Officer, President, New York City Central Labor M&T Bank Corporation, Buffalo, NY RXR, New York, NY Council, AFL-CIO, New York, NY Douglas L. Kennedy,2025 Adena T. Friedman, 2025 Pat Wang, 2025 President and Chief Executive Officer, President and Chief Executive Officer, President and Chief Executive Officer, Peapack-Gladstone Bank, Nasdaq, New York, NY Healthfirst, New York, NY Bedminster, NJ Arvind Krishna, 2026 Rajiv J. Shah, 2026 John H. Buhrmaster, 2026 Chairman and Chief Executive Officer, President, The Rockefeller Foundation, President and Chief Executive Officer, IBM, New York, NY New York, NY 1st National Bank of Scotia and Glenville Bank Holding Company, Scotia, NY

Federal Reserve System Organization 113 District 3–Philadelphia Covers the state of Delaware, 9 counties in southern New Jersey, and 48 3—C counties in the eastern two-thirds of Pennsylvania. PA NJ For more information on this District and to learn more about the Federal Reserve Bank of Philadelphia’s operations, visit https://www.philadelphia DE fed.org/. Information on economic conditions for this District can be found in the Federal Reserve System’s Beige Book at https://www.federalreserve. Philadelphia gov/monetarypolicy/beige-book-default.htm. Also find the Reserve Bank’s financial statements for 2024 at https://www.federalreserve.gov/ aboutthefed/files/philadelphiafinstmt2024.pdf. Class A Class B Class C Timothy Snyder, 2024 Julia H. Klein, 2024 Sharmain Matlock-Turner, President and Chief Executive Officer, Chairwoman and Chief Executive 2024 Fleetwood Bank, Fleetwood, PA Officer, C. H. Briggs Company, Chief Executive Officer, Urban Affairs Reading, PA Coalition, Philadelphia, PA Vacancy, 2025 John Fry, 2025 Anthony Ibargüen, 2025 Randall E. Black, 2026 President, Drexel University, Chief Executive Officer, Quench USA, President and Chief Executive Officer, Philadelphia, PA Inc., and Executive Chair, Culligan Citizens Financial Services Inc. and Latin America, King of Prussia, PA First Citizen’s Community Bank, Bret S. Perkins, 2026 Mansfield, PA Senior Vice President, External and William Lo, 2026 Government Affairs, Comcast President, Crystal Steel Fabricators, Corporation, Philadelphia, PA Inc., Delmar, DE

114 111th Annual Report | 2024 District 4–Cleveland 4—D Covers the state of Ohio, 56 counties in eastern Kentucky, 19 counties in Pittsburgh western Pennsylvania, and 6 counties in northern West Virginia. PA OH For more information on this District and to learn more about the Federal WV Cincinnati Reserve Bank of Cleveland’s operations, visit https://www.cleveland KY fed.org/. Information on economic conditions for this District can be found Cleveland in the Federal Reserve System’s Beige Book at https://www.federal reserve.gov/monetarypolicy/beige-book-default.htm. Also find the Reserve Bank’s financial statements for 2024 at https://www.federalreserve.gov/ aboutthefed/files/clevelandfinstmt2024.pdf. Class A Ramona Hood, 2026 Melvin Gravely, 2026 Retired President and Chief Executive Chief Executive Officer, TriVersity Eddie L. Steiner, 2024 Officer, FedEx Custom Critical, Construction, Cincinnati, OH President and Chief Executive Officer, Uniontown, OH CSB Bancorp, Inc., Millersburg, OH Pittsburgh Branch Cincinnati Branch Helga Houston, 2025 Appointed by the Federal Reserve Bank Senior Executive Vice President and Appointed by the Federal Reserve Bank Chief Risk Officer, Huntington Nishan J. Vartanian, 2024 Bancshares Inc., Columbus, OH Archie M. Brown, 2024 Chairman of the Board, MSA Safety President and Chief Executive Officer, Incorporated, Cranberry Township, PA James H. Nicholson, 2026 First Financial Bancorp, Cincinnati, OH President and Chief Executive Officer, Sanjay Chopra, 2025 North Valley Bank, Zaneville, OH Gina McFarlane-El, 2025 Co-Founder and Chief Executive Chief Executive Officer, Five Rivers Officer, Cognistx, Pittsburgh, PA Class B Health Centers, Dayton, OH Earl Buford, 2026 Jacqueline Gamblin, 2024 Mary Meixelsperger, 2026 President, CAEL, Indianapolis, IN Chief Financial Officer, Valvoline, Inc., Chief Executive Officer, JYG Innova- Lexington, KY Christina A. Cassotis, 2026 tions, Dayton, OH Chief Executive Officer, Allegheny Holly B. Wiedemann, 2025 Bimal Patel, 2026 County Airport Authority, Pittsburgh, PA President, Rolling Hills Hospitality, Founder, AU Associates, Inc., Appointed by the Board of Governors Cincinnati, OH Lexington, KY Vera Krekanova, 2024 Appointed by the Board of Governors Darrell McNair, 2026 Chief Strategy and Research Officer, President, MVP Plastics, Inc., Rachid Abdallah, 2024 Allegheny Conference on Community Middlefield, OH Chairman and Chief Executive Officer, Development, Pittsburgh, PA Jedson Engineering, Cincinnati, OH Class C Eugene Boyer III, 2025 Jill Meyer, 2025 Brokerage Advisor, NAI Burns Scalo, Richard J. Kramer, 2024 Chief Operating and Relationships Pittsburgh, PA Former Chairman, Chief Executive Officer and Managing Director— Officer, and President, The Goodyear Cincinnati, The O.H.I.O. Fund, Kathy Wilson Humphrey, 2026 Tire & Rubber Company, Akron, OH Cincinnati, OH President, Carlow University, Pittsburgh, PA Heidi L. Gartland, 2025 Chief Government and Community Relations Officer, University Hospitals, Cleveland, OH

Federal Reserve System Organization 115 District 5–Richmond Covers the states of Maryland, Virginia, North Carolina, and South 5—E Baltimore MD Carolina; 49 counties constituting most of West Virginia; and the District of Columbia. VA WV NC For more information on this District and to learn more about the Federal Charlotte SC Reserve Bank of Richmond’s operations, visit https://www.richmond Richmond fed.org/. Information on economic conditions for this District can be found in the Federal Reserve System’s Beige Book at https:// www.federalreserve.gov/monetarypolicy/beige-book-default.htm. Also find the Reserve Bank’s financial statements for 2024 at https://www.federalreserve.gov/ aboutthefed/files/richmondfinstmt2024.pdf. Class A Lisa M. Hamilton, 2026 Charlotte Branch President and Chief Executive Officer, James H. Sills III, 2024 The Annie E. Casey Foundation, Appointed by the Federal Reserve Bank President and Chief Executive Officer, Baltimore, MD Samuel L. Erwin, 2024 Mechanics and Farmers Bank, Executive Vice President, First Horizon Durham, NC Baltimore Branch Bank, Greenville, SC Alice P. Frazier, 2025 Appointed by the Federal Reserve Bank George Dean Johnson III, 2024 President and Chief Executive Officer, Bank of Charles Town, Tom Geddes, 2024 Chief Executive Officer, Johnson Development Associates, Inc., Charles Town, WV Partner and Portfolio Manager, Brown Spartanburg, SC Advisory, Baltimore, MD Jennifer LaClair, 2026 Head of Global Business Solutions, Anthony Jenkins,2024 Dionne Nelson, 2025 President and Chief Executive Officer, Fiserv, Charlotte, NC President, Coppin State University, Laurel Street Residential, Baltimore, MD Charlotte, NC Class B Cecilia A. Hodges, 2025 Lori Hudson, 2026 Barbara Humpton, 2024 Regional President Greater Washing- Vice President and Chief Financial ton and Virginia, M&T Bank, President and Chief Executive Officer, Officer, National Gypsum Company, Falls Church, VA Siemens Corporation USA, Washing- Charlotte, NC ton, DC Brenda Galgano, 2026 Appointed by the Board of Governors Scott Werry, 2025 Senior Vice President and Chief Managing Partner, Atlas, Chapel Hill, Financial Officer, Perdue, Salis- Bernett William Mazyck, 2024 NC bury, MD President and Chief Executive Officer, South Carolina Association for Appointed by the Board of Governors Robert M. Blue, 2026 Community Economic Development, President and Chief Executive Officer, Brian McLaughlin, 2024 Charleston, SC Dominion Energy, Richmond, VA Founder and Managing Partner, James F. Goodmon Jr., 2025 PlanitWorks, Silver Spring, MD Class C President and Chief Operating Officer, William J. McCarthy, 2025 Capitol Broadcasting Company, Halsey M. Cook,2024 Executive Director, Catholic Charities Raleigh, NC President and Chief Executive Officer, of Baltimore, Baltimore, MD Barbara Melvin, 2026 Milliken, Spartanburg, SC Leslie D. Hale, 2026 President and Chief Executive Officer, Jodie McLean, 2025 President and Chief Executive Officer, South Carolina Ports Authority, Mount Chief Executive Officer, EDENS, RLJ Lodging Trust, Bethesda, MD Pleasant, SC Washington, DC

116 111th Annual Report | 2024 District 6–Atlanta 6—F Covers the states of Alabama, Florida, and Georgia; TN Nashville 74 counties in the eastern two-thirds of Tennessee; Birmingham AL 38 parishes of southern Louisiana; and 43 counties of MS GA southern Mississippi. LA Jacksonville New Orleans FL For more information on this District and to learn more Miami about the Federal Reserve Bank of Atlanta’s operations, Atlanta visit https://www.frbatlanta.org/. Information on economic conditions for this District can be found in the Federal Reserve System’s Beige Book at https://www.federal reserve.gov/monetarypolicy/beige-book-default.htm. Also find the Reserve Bank’s financial statements for 2024 at https://www.federalreserve.gov/aboutthefed/files/atlantafinstmt2024.pdf. Class A James O. Etheredge, 2025 Randall P. Breaux, 2025 Former Special Advisor to the Chief Group President, Genuine Parts William Y. Carroll, Jr., 2024 Executive Officer, Accenture North Company of North America, Birming- President and Chief Executive Officer, America, Atlanta, GA ham, AL SmartBank, Knoxville, TN Gregory A. Haile, 2026 Hafiz Chandiwala, 2026 Cynthia N. Day, 2025 Former President, Broward College, Executive Vice President and Chief President and Chief Executive Officer, Fort Lauderdale, FL Administrative Officer, Coca Cola Citizens Trust Bank, Atlanta, GA Bottling Company United, Inc., Birmingham Branch Birmingham, AL Rajinder P. Singh,2026 Chairman, President, and Chief Appointed by the Federal Reserve Bank Jacksonville Branch Executive Officer, BankUnited, Inc., Miami Lakes, FL Michelle Lewis, 2024 Appointed by the Federal Reserve Bank Chief Financial Officer, AAA Cooper Class B Transportation, Dothan, AL Vacancy, 2024 Michael Russell, 2024 David L. Nast, 2024 Brian E. Wolfburg, 2024 President, Alabama/Florida Pan- President and Chief Executive Officer, Chief Executive Officer, H.J. Russell handle, United Community Bank, VyStar Credit Union, Jacksonville, FL and Company, Atlanta, GA Huntsville, AL Nicole B. Thomas, 2025 R. Andrew Watts, 2025 Melanie Bridgeforth, 2025 Executive Vice President, Chief Hospital President, Baptist Medical President and Chief Executive Officer, Financial Officer, and Treasurer, Brown Center Jacksonville, Jacksonville, FL Women’s Foundation of Alabama, & Brown, Inc., Daytona Brach, FL Michael E. Longo, 2026 Birmingham, AL Dana Kilborne, 2026 President and Chief Executive Officer, Samuel N. Addy, 2026 Chief Executive Officer, Cypress Hibbett, Inc., Birmingham, AL Senior Research Economist, The Capital Group, and President and University of Alabama, Tuscaloosa, AL Chief Executive Officer, Cypress Bank Class C and Trust, Melbourne, FL Appointed by the Board of Governors Claire Lewis Arnold, 2024 Chief Executive Officer, Leapfrog Christy Thomas, 2024 Services, Inc., Atlanta, GA Chief Financial Officer, McKinney Communications Corporation, Birmingham, AL

Federal Reserve System Organization 117 Appointed by the Board of Governors Rita Case, 2025 William Bradley Southern, President and Chief Executive Officer, 2026 Timothy P. Cost, 2024 Rick Case Automotive Group, Chair and Chief Executive Officer, President, Jacksonville University, Sunrise, FL Louisiana-Pacific Corporation, Jacksonville, FL Nashville, TN Diane Bessette, 2026 Lisa Palmer, 2025 President and Chief Executive Officer, Vice President and Chief Financial New Orleans Branch Officer, Lennar Corporation, Miami, FL Regency Centers Corporation, Appointed by the Federal Reserve Bank Jacksonville, FL Nashville Branch Vacancy,2024 Edward A. Moratin, 2026 Appointed by the Federal Reserve Bank President, LIFT Orlando, Orlando, FL David T. Darragh, 2024 Kelly M. Dilts, 2024 Operating Partner, LongueVue Capital, Miami Branch Executive Vice President and Chief Metairie, LA Financial Officer, Dollar General, Appointed by the Federal Reserve Bank Goodlettsville, TN William J. Bynum, 2025 Chief Executive Officer, Hope Credit Ginger Martin, 2024 Leif M. Murphy, 2024 Union, Hope Enterprise Corp., and President and Chief Executive Officer, Chief Executive Officer, TeamHealth Hope Policy Institute, Jackson, MS American National Bank, Oakland Holdings, Inc., Knoxville, TN Park, FL William G. Yates III, 2026 Michael Honious, 2025 President and Chief Executive Officer, Jose Cueto, 2025 President and Chief Executive Officer, W.G. Yates & Sons Construction President and Chief Operating Officer, GEODIS in Americas, Brentwood, TN Company, Biloxi, MS Grove Bank and Trust, Miami, FL Marshall E. Crawford Jr., 2026 Appointed by the Board of Governors Ignacio Garcia-Menocal, 2026 President and Chief Executive Officer, Co-Founder and Chief Executive John C. Driscoll, 2024 The Housing Fund, Inc., Nashville, TN Officer, Grove Bay Hospitality Group, Director and Chief Executive Officer, Miami, FL Appointed by the Board of Governors Alabama Port Authority, Mobile, AL Daniel Lavender, 2026 Thomas Zacharia, 2024 Chief Executive Officer, Moorings Park Senior Vice President, Strategic Melissa B. Rogers, 2025 Institute, Inc., Naples, FL Technology Partnerships and Public President and Founder, Noble Plastics, Policy, AMD, Lenoir City, TN Grand Coteau, LA Appointed by the Board of Governors Amanda Hite, 2025 Ajith Kumaran, 2026 Kathleen Cannon, 2024 President, STR, Hendersonville, TN Co-Chief Executive Officer, Raising President and Chief Executive Officer, Cane’s, Baton Rouge, LA United Way of Broward County, Fort Lauderdale, FL

118 111th Annual Report | 2024 District 7–Chicago 7—G Covers the state of Iowa, 68 counties of northern Indiana, 50 counties of northern Illinois, 68 counties of southern MI Michigan, and 46 counties of southern Wisconsin. WI Detroit IA For more information on this District and to learn more about the IL IN Federal Reserve Bank of Chicago’s operations, visit https:// www.chicagofed.org/. Information on economic conditions for Chicago this District can be found in the Federal Reserve System’s Beige Book at https://www.federalreserve.gov/monetarypolicy/beigebook-default.htm. Also find the Reserve Bank’s financial statements for 2024 at https://www.federalreserve.gov/ aboutthefed/files/chicagofinstmt2024.pdf. Class A David Cyril Habiger, 2026 Kofi Bonner, 2025 President and Chief Executive Officer, Chief Executive Officer, Bedrock Christopher J. Murphy III, 2024 J.D. Power, Troy, MI Management Service LLC, Detroit, MI Chairman and Chief Executive Officer, 1st Source Bank, South Bend, IN Class C JoAnn Chavez, 2026 Senior Vice President and Chief Legal Susan Whitson, 2025 Juan Salgado, 2024 Officer, DTE Energy, Detroit, MI Chief Executive Officer, First Bank, and Chancellor, City Colleges of Chicago, President, First of Waverly Corpora- Lisa Lunsford, 2026 Chicago, IL tion, Waverly, IA Chief Executive Officer and Co- Maurice Smith, 2025 Founder, Global Strategic Supply Michael O’Grady, 2026 President, Chief Executive Officer, and Solutions (GS3 Global), Livonia, MI Chairman, President, and Chief Vice Chair, Health Care Service Executive Officer, Northern Trust, Appointed by the Board of Governors Corporation, Chicago, IL Chicago, IL James M. Nicholson, 2024 Jennifer Scanlon, 2026 Co-Chairman, PVS Chemicals, Inc., Class B President and Chief Executive Officer, Detroit, MI UL Solutions, Northbrook, IL Linda P. Hubbard, 2024 Ronald E. Hall, 2025 President and Chief Executive Officer, Detroit Branch President and Chief Executive Officer, Carhartt, Inc., Dearborn, MI Bridgewater Interiors, LLC, Detroit, MI Appointed by the Federal Reserve Banks Linda Jojo, 2025 Richard Keyes, 2026 Executive Vice President, Chief Anika Goss, 2024 President and Chief Executive Officer, Customer Officer, United Airlines, Inc., Chief Executive Officer, Detroit Future Meijer, Grand Rapids, MI Chicago, IL City, Detroit, MI

Federal Reserve System Organization 119 District 8–St. Louis Covers the state of Arkansas, 44 counties in southern Illinois, 8—H 24 counties in southern Indiana, 64 counties in western Kentucky, KY IL IN 39 counties in northern Mississippi, 71 counties in central and eastern Missouri, the city of St. Louis, and 21 counties in western MO Louisville TN Tennessee. AR Memphis Little Rock MS For more information on this District and to learn more about the St. Louis Federal Reserve Bank of St. Louis’s operations, visit https:// www.stlouisfed.org/. Information on economic conditions for this District can be found in the Federal Reserve System’s Beige Book at https://www.federalreserve.gov/monetarypolicy/beige-book-default.htm. Also find the Reserve Bank’s financial statements for 2024 at https://www.federalreserve.gov/aboutthefed/files/ stlouisfinstmt2024.pdf. Class A Carolyn Chism Hardy, 2025 Allison J. H. Thompson, 2025 President and Chief Executive Officer, President and Chief Executive Officer, Misty Borrowman, 2024 Chism Hardy Investments, LLC, Economic Development Alliance for President and Chief Executive Officer, Collierville, TN Jefferson County, Arkansas, Bank of Hillsboro, Hillsboro, IL Pine Bluff, AR Gregory A. Heckman, 2026 C. Mitchell Waycaster, 2025 Chief Executive Officer, Bunge Global Jennifer J. Anglin, 2026 President and Chief Executive Officer, SA, Chesterfield, MO Senior Director Fort Smith Operations, Renasant Bank, Tupelo, MS Pernod Ricard USA, Fort Smith, AR Little Rock Branch Mardie R. Herndon Jr., 2026 Louisville Branch President and Chief Executive Officer, Appointed by the Federal Reserve Bank Paducah Bank and Trust Company, Appointed by the Federal Reserve Bank Paducah, KY Jeff Lynch, 2024 President and Chief Executive Officer, Dave W. Christopher, Sr., 2024 Class B Eagle Bank & Trust Co., Little Rock, Founder and Executive Director, AR AMPED Louisville, Louisville, KY Michael Ugwueke, 2024 Christopher B. Hegi, 2025 James A. Hillebrand, 2025 President and Chief Executive Officer, President and Chief Executive Officer, Chairman and Chief Executive Officer, Methodist Le Bonheur Healthcare, First Financial Bank, El Dorado, AR Stock Yards Bank & Trust, Memphis, TN Louisville, KY Penelope Pennington, 2025 Denise Thomas, 2026 Chief Executive Officer, World Trade Vacancy, 2026 Managing Partner, Edward Jones, Center Arkansas, University of St. Louis, MO Arkansas, Rogers, AR Carrie A. Warren, 2026 R. Andrew Clyde, 2026 President, Bank of Buffalo, Buffalo, KY Darrin Williams, 2026 President and Chief Executive Officer, Appointed by the Board of Governors Chief Executive Officer, Southern Murphy USA Inc., El Dorado, AR Bancorp, Inc., Little Rock, AR Emerson M. Goodwin, 2024 Class C Appointed by the Board of Governors Senior Vice President of Business Development, ARcare, Bentonville, AR Lal Karsanbhai, 2024 Jamie J. Henry, 2024 Chief Executive Officer, Emerson Vice President Finance, Emerging David Tatman, 2025 Electric Co., St. Louis, MO Payments, Walmart Inc., Assistant Plant Manager and Director Bentonville, AR of Engineering, Bendix Commercial Vehicle Systems, Bowling Green, KY

120 111th Annual Report | 2024 Condrad Daniels, 2026 R. Davy Carter, 2025 Appointed by the Board of Governors President, HJI Supply Chain Solutions, Regional President, Home Tracy D. Hall, 2024 Louisville, KY BancShares, Inc., Jonesboro, AR President, Southwest Tennessee Memphis Branch Jeff Agee, 2026 Community College, Memphis, TN Chairman and Chief Executive Officer, Vacancy, 2025 Appointed by the Federal Reserve Bank First Citizens National Bank, Dyersburg, TN Vacancy, 2026 Tyrone Burroughs, 2024 President and Chief Executive Officer, Henry N. Reichle Jr., 2026 First Choice Sales and Marketing President and Chief Executive Officer, Group Inc., Memphis, TN Staplcotn, Greenwood, MS

Federal Reserve System Organization 121 District 9–Minneapolis Covers the states of Minnesota, Montana, 9—I North Dakota, and South Dakota; the Upper MT Peninsula of Michigan; and 26 counties in ND Helena MN northern Wisconsin. MI SD WI For more information on this District and to learn more about the Federal Reserve Bank Minneapolis of Minneapolis’s operations, visit https:// www.minneapolisfed.org/. Information on economic conditions for this District can be found in the Federal Reserve System’s Beige Book at https://www.federalreserve.gov/monetarypolicy/beige-book-default.htm. Also find the Reserve Bank’s financial statements for 2024 at https://www.federalreserve.gov/aboutthefed/files/ minneapolisfinstmt2024.pdf. Class A Lakota Vogel, 2025 Helena Branch Executive Director, Four Bands Jeanne H. Crain, 2024 Community Fund, Eagle Butte, SD Appointed by the Federal Reserve Bank President and Chief Executive Officer, Jason Adams, 2024 Bremer Financial Corporation, Chelsie Glaubitz Gabiou, 2026 Owner and Consultant, Ace Housing St. Paul, MN President, Minneapolis Regional Labor and Development, LLC, Polson, MT Federation, AFL-CIO, Minneapolis, MN Brenda K. Foster, 2025 Mary Rutherford, 2025 Chairman, President, and Chief Class C President and Chief Executive Officer, Executive Officer, First Western Bank Montana Community Foundation, and Trust, Minot, ND Paul D. Williams, 2024 Helena, MT President and Chief Executive Officer, Gerald H. Jacobson, 2026 Project for Pride in Living, William C. Keller, 2026 President, Northwestern Bank, Minneapolis, MN President and Chief Executive Officer, Chippewa Falls, WI Independence Bank, Havre, MT Chris Hilger, 2025 Class B Chairman, President, and Chief Appointed by the Board of Governors Executive Officer, Securian Financial, Sarah Walsh, 2024 St. Paul, MN Bobbi Wolstein, 2024 Chief Executive Officer, MMA Chief Financial Officer, LHC, Inc., Northwest, Marsh McLennan Agency, Jay Debertin, 2026 Kalispell, MT Helena, MT President and Chief Executive Officer, Alan D. Ekblad, 2026 CHS Inc., Inner Grove Heights, MN Senior and Managing Partner, Strategic Labor Partnerships, Helena, MT

122 111th Annual Report | 2024 District 10–Kansas City 10—J Covers the states of Colorado, Kansas, Nebraska, WY Oklahoma, and Wyoming; 43 counties in western Missouri; and 14 counties in northern New Mexico. NE CO Omaha MO For more information on this District and to learn KS Denver more about the Federal Reserve Bank of Kansas NM Oklahoma City City’s operations, visit https://www.kansas OK cityfed.org/. Information on economic conditions for Kansas City this District can be found in the Federal Reserve System’s Beige Book at https://www.federal reserve.gov/monetarypolicy/beige-book-default.htm. Also find the Reserve Bank’s financial statements for 2024 at https://www.federalreserve.gov/ aboutthefed/files/kansascityfinstmt2024.pdf. Class A Class C Rachel Gerlach, 2026 Chief Credit Officer, Alpine Bank, Kyle Heckman, 2024 Jandel Allen-Davis, MD, 2024 Glenwood Springs, CO Chairman and Chief Executive Officer, President and Chief Executive Officer, Flatirons Bank, Boulder, CO Craig Hospital, Englewood, CO Appointed by the Board of Governors Alex Williams, 2025 Patrick A. Dujakovich, 2025 Janice J. Lucero, 2024 President and Chief Executive Officer, Chairman, Chief Executive Officer, and President, Greater Kansas City Motor Vehicle Division Express, President, Halstead Bank, AFL-CIO, Kansas City, MO Albuquerque, NM Halstead, KS Paul Maass, 2026 Susan Chapman Plumb, 2026 Chief Executive Officer, Scoular, Del Esparza, 2025 Chief Executive Officer, Esparza Digital Board Chair and Chief Executive Omaha, NE & Advertising, Albuquerque, NM Officer, Local Bank, Hulbert, OK Denver Branch Navin Dimond, 2026 Class B Founder and Chief Executive Officer, Appointed by the Federal Reserve Bank Stonebridge Companies, Denver, CO Ramin Cherafat, 2024 Nicole Glaros, 2024 Chief Executive Officer, McCownGor- Founder and Chief Executive Officer, Oklahoma City Branch don Construction, Kansas City, MO Phos, Boulder, CO Appointed by the Federal Reserve Bank Carmen Tapio, 2025 Vacancy, 2024 Owner, President, and Chief Executive J. Walter Duncan IV, 2024 Officer, North End Teleservices, LLC, John J. Coyne III, 2025 President, Duncan Oil Properties, Inc., Omaha, NE Chairman, Chief Executive Officer, and Oklahoma City, OK President, Big Horn Federal Savings Ruben Alonso III, 2026 Mark Burrage, 2025 Bank, Greybull, WY Chief Executive Officer, AltCap, Chief Executive Officer, FirstBank, Kansas City, MO Atoka, OK

Federal Reserve System Organization 123 Terry Salmon, 2025 Omaha Branch Appointed by the Board of Governors President, Computer System Appointed by the Federal Reserve Bank Joanne Li, 2024 Designers, Oklahoma City, OK Chancellor, University of Nebraska at Brady Sidwell, 2026 Zac Karpf, 2024 Omaha, Omaha, NE President, Platte Valley Bank, Owner and Principal, Sidwell Scottsbluff, NE L. Javier Fernandez, 2025 Strategies, LLC, Enid, OK President and Chief Executive Officer, Appointed by the Board of Governors Susan L. Martin, 2024 Omaha Public Power District, President and Secretary-Treasurer, Omaha, NE Rhonda Hooper, 2024 Nebraska State AFL-CIO, Lincoln, NE President and Chief Executive Officer, David Roth, 2026 Jordan Advertising, Oklahoma City, OK Clark Lauritzen, 2025 Chief Executive Officer, Omaha Airport Chairman and President, First National Authority, Omaha, NE Dana S. Weber, 2025 Bank of Omaha, Omaha, NE Chief Executive Officer and Chairman of the Board, Webco Industries, Inc., DJ Eihusen, 2026 Sand Springs, OK Chair, Chief Executive Officer, and President, Chief Industries, Inc., Grand Scott Case, 2026 Island, NE President, Case & Associates Properties, Inc., Tulsa, OK

124 111th Annual Report | 2024 District 11–Dallas 11—K Covers the state of Texas, 26 parishes in northern TX Louisiana, and 18 counties in southern New Mexico. NM LA For more information on this District and to learn El Paso Houston more about the Federal Reserve Bank of Dallas’s San Antonio operations, visit https://www.dallasfed.org. Information on economic conditions for this District can be Dallas found in the Federal Reserve System’s Beige Book at https://www.federalreserve.gov/monetarypolicy/ beige-book-default.htm. Also find the Reserve Bank’s financial statements for 2024 at https://www.federalreserve.gov/aboutthefed/files/ dallasfinstmt2024.pdf. Class A Class C James Walter, 2026 Co-Chief Executive Officer, Permian Kelly A. Barclay, 2024 Gary C. Kelly, 2024 Resources, Midland, TX President and Chief Executive Officer, Executive Chairman, Southwest Ozona Bank, Wimberly, TX Airlines, Dallas, TX Appointed by the Board of Governors Joe Quiroga, 2025 Thomas J. Falk, 2025 Tracy J. Yellen, 2024 Chief Executive Officer, Paso del Norte President, Texas National Bank, Retired Chairman and Chief Executive Community Foundation, El Paso, TX Edinburg, TX Officer, Kimberly-Clark Corporation, Robert A. Hulsey, 2026 Dallas, TX Von C. Washington Sr., 2025 President and Chief Executive Officer, Claudia Aguirre, 2026 President, IDA Technology, El Paso, TX American National Bank of Texas, President and Chief Executive Officer, Leila Melendez, 2026 Terrell, TX BakerRipley, Houston, TX Chief Executive Officer, Workforce Solutions Boderplex, El Paso, TX Class B El Paso Branch Houston Branch James K. Hill, 2024 Appointed by the Federal Reserve Bank President, James Hill Consulting, and William Serrata, 2024 Appointed by the Federal Reserve Bank Director, Neeley Center for Real Estate, Texas Christian University, Fort President, El Paso Community College, Peter Rodriguez,2024 El Paso, TX Worth, TX Dean and Professor of Strategic Kari Mitchell, 2025 Management, Rice University, Cynthia Taylor, 2025 Houston, TX Chief Executive Officer, Las Cruces President and Chief Executive Officer, Oil States International Inc., Machine Mfg. & Engineering, Inc., Gary R. Petersen, 2025 Mesilla Park, NM Houston, TX Managing Partner and Founder, EnCap Christian Perez Giese, 2026 Investments L.P., Houston, TX Pascal Desroches, 2026 Senior Vice President, CBRE, Inc., Senior Executive Vice President and El Paso, TX Chief Financial Officer, AT&T, Inc., Dallas, TX

Federal Reserve System Organization 125 Marc Boom, 2026 San Antonio Branch Appointed by the Board of Governors President and Chief Executive Officer, Appointed by the Federal Reserve Bank Monica Salinas, 2024 Houston Methodist, Houston, TX Chief Executive Officer, Operations, Bhavesh V. Patel, 2026 Gabriel Guerra, 2024 Cromex Forwarding Inc., Laredo, TX President and Chief Executive Officer, Former President, Standard Industries, Kleberg Bank, Kingsville, TX Rosa Santana, 2025 Houston, TX Founder and Chief Executive Officer, Denise Rodriguez Hernandez, Appointed by the Board of Governors Santana Group, San Antonio, TX 2025 Cynthia N. Colbert, 2024 Owner and Chief Executive Officer, The Veronica Muzquiz Edwards, President and Chief Executive Officer, Eatery Culinary Group, San Antonio, TX 2026 Catholic Charities Archdiocese of Chief Executive Officer, InGenesis, Galveston-Houston, Houston, TX Bradley Barron, 2026 Inc., San Antonio, TX Former President and Chief Executive Ric Campo, 2025 Officer, NuStar Energy, San Antonio, TX Chairman and Chief Executive Officer, Camden Property Trust, Houston, TX Tyson Tuttle, 2026 Founder and Chief Executive Officer, Ruth J. Simmons, 2026 Circuit, Austin, TX Former President, Prairie View A&M University, Prairie View, TX

126 111th Annual Report | 2024 District 12–San Francisco 12—L Covers the states of Alaska, Arizona, California, Hawaii, Idaho, Nevada, Oregon, Utah, and Washington, and serves American Samoa, Guam, and the Commonwealth of the Alaska WA Northern Mariana Islands. Seattle Portland For more information on this District and to learn more OR ID about the Federal Reserve Bank of San Francisco’s opera- CA NV tions, visit http://www.frbsf.org/. Information on economic Guam Salt Lake City conditions for this District can be found in the Federal UT Reserve System’s Beige Book at https://www.federal Los Angeles reserve.gov/monetarypolicy/beige-book-default.htm. Also Hawaii AZ find the Reserve Bank’s financial statements for 2024 at San Francisco https://www.federalreserve.gov/aboutthefed/files/ sanfranciscofinstmt2024.pdf. Class A Class C Zach Moon, 2024 General Manager, California Steel Clint E. Stein, 2024 David P. White, 2024 Industries, Inc., Fontana, CA Chief Executive Officer, Umpqua Bank, Chief Executive Officer, 3CG Ventures, Portland, OR and Former National Executive Chang M. Liu, 2025 Director, Screen Actors Guild, Los President and Chief Executive Officer, Vacancy, 2025 Angeles, CA Cathay Bank, Los Angeles, CA Laura Lee Stewart, 2026 Mario Cordero, 2025 Vacancy, 2026 President and Chief Executive Officer, Executive Director, Port of Long Beach, Sound Community Bank and Sound Long Beach, CA Appointed by the Board of Governors Financial Bancorporation, Seattle, WA Jack L. Sinclair, 2024 Russell A. Childs, 2026 Chief Executive Officer, Sprouts Class B Chief Executive Officer and President, Farmers Market, Phoenix, AZ SkyWest, Inc., St. George, UT Arthur F. Oppenheimer, 2024 Rosemary A. Vassiliadis, 2025 Chairman and Chief Executive Officer, Los Angeles Branch Director of Aviation, Harry Reid Oppenheimer Companies, Inc., and International Airport, Las Vegas, NV President, Oppenheimer Development Appointed by the Federal Reserve Bank Corporation, Boise, ID Carlos Gonzalez, 2026 Selena S. Cuffe, 2024 Division President, Clark Construction Maritza Diaz, 2025 Co-Founder, Heritage Link Brands, and Group, Irvine, CA Chief Executive Officer, ITJ USA, Inc., Chief Growth Officer, Blackstone San Marcos, CA Consulting, Inc., Los Angeles, CA Karen Kimbrough, 2026 Chief Economist, LinkedIn, Sunnyvale, CA

Federal Reserve System Organization 127 Portland Branch Salt Lake City Branch Seattle Branch Appointed by the Federal Reserve Bank Appointed by the Federal Reserve Bank Appointed by the Federal Reserve Bank Stacey M. L. Dodson, 2024 Lisa Ann Grow, 2024 Michael S. Senske, 2024 Market President, Portland and President and Chief Executive Officer, President and Chief Executive Officer, Southwest Washington, U.S. Bank, IdaCorp & Idaho Power, Boise, ID Pearson Packaging Systems, Portland, OR Spokane, WA Jose Enriquez, 2025 Maria Pope, 2025 Founder and Chief Executive Officer, Robert C. Donegan, 2025 President and Chief Executive Officer, Latinos In Action, Sandy, UT President, Ivar’s Inc., Seattle, WA Portland General Electric Company, Portland, OR Melanie Cox, 2026 Gabriel Kompkoff, 2026 Chief Executive Officer, Backcountry- President and Chief Financial Officer, Alicia Chapman, 2026 .com, Park City, UT Grant Aviation, Anchorage, AK Owner and Chief Executive Officer, Willamette Technical Fabricators, Mark Packard, 2026 Eric Pearson, 2026 Portland, OR President and Chief Executive Officer, President and Chief Executive Officer, Central Bank, Provo, UT Community First Bank, Kennewick, WA Andrew Colas, 2026 Appointed by the Board of Governors Appointed by the Board of Governors President, Colas Construction, Inc., Portland, OR O. Randall Woodbury, 2024 Pallavi Mehta Wahi, 2024 President and Chief Executive Officer, Seattle Managing Partner and Appointed by the Board of Governors Woodbury Corporation, Co-United States Managing Partner, Gale Castillo, 2024 Salt Lake City, UT K&L Gates LLP, Seattle, WA President, Canopy, Portland, OR Vacancy, 2025 Sheila Edwards Lange, 2025 Vacancy, 2025 Chancellor, University of Washington Susan D. Morris, 2026 Tacoma, Tacoma, WA Graciela Gomez-Cowger, 2026 Executive Vice President and Chief Chief Executive Officer, Schwabe, Operations Officer, Albertsons John Wolfe, 2026 Williamson & Wyatt, Portland, OR Companies, Boise, ID Chief Executive Officer, Northwest Seaport Alliance, Tacoma, WA

128 111th Annual Report | 2024 Reserve Bank and Branch Leadership Each year, the Board of Governors designates one Class C director to serve as chair and one Class C director to serve as deputy chair of each Reserve Bank board. Reserve Banks also have a president and first vice president who are appointed by the Bank’s Class C (and certain Class B) directors, subject to approval by the Board of Governors. Each Reserve Bank selects a chair for every Branch in its District from among the directors on the Branch board who were appointed by the Board of Governors. For each Branch, an officer from its Reserve Bank is also charged with the oversight of Branch operations. Boston Corey Thomas, Chair Susan M. Collins, President and Karen A. Pennell, Chief Executive Officer First Vice President and Roger W. Crandall, Deputy Chair Chief Operating Officer New York Vincent Alvarez, Chair John C. Williams, President and Sushmita Shukla, First Vice Chief Executive Officer President and Chief Operating Officer Pat Wang, Deputy Chair Additional office at East Rutherford, NJ Philadelphia Anthony Ibarguen, Chair Patrick T. Harker, President and Jeanne R. Rentezelas, First Vice Chief Executive Officer President and Chief Operating Officer Sharmain Matlock-Turner, Deputy Chair Cleveland Heidi L. Gartland, Chair Cincinnati Pittsburgh Richard J. Kramer, Deputy Chair Rachid Abdallah, Chair Vera Krekanova, Chair Beth M. Hammack, President Julianne Dunn, Vice President Russell Mills, Vice President and and Chief Executive Officer and Senior Regional Officer Senior Regional Officer Mark S. Meder, First Vice President and Chief Operating Officer

Federal Reserve System Organization 129 Richmond Jodie McLean, Chair Baltimore Charlotte Lisa M. Hamilton, Deputy Chair William J. McCarthy, Chair Bernett William Mazyck, Chair Thomas I. Barkin, President and Andy Bauer, Vice President and Matthew A. Martin, Vice Chief Executive Officer Baltimore Regional Executive President and Charlotte Regional Executive Becky Bareford, First Vice President and Chief Operating Officer Atlanta Claire Lewis Arnold, Chair Jacksonville Nashville Gregory A. Haile, Deputy Chair Lisa Palmer, Chair Thomas Zacharia, Chair Raphael W. Bostic, President Michelle Dennard, Vice President Laurel Graefe, Vice President and and Chief Executive Officer and Regional Executive Regional Executive Cheryl Venable, First Vice Miami New Orleans President and Chief Operating Officer Kathleen Cannon, Chair John C. Driscoll, Chair Birmingham Shari Bower, Vice President and Adrienne C. Slack, Vice Randall P. Breaux, Chair Regional Executive President and Regional Executive Anoop Mishra, Vice President and Regional Executive Chicago Jennifer Scanlon, Chair Ellen Bromagen, First Vice Detroit President and Chief Operating Officer Juan Salgado, Deputy Chair Ronald E. Hall, Chair Additional office at Des Moines, IA Austan Goolsbee, President and Rick Mattoon, Vice President of Chief Executive Officer Regional Analysis and Engagement, Detroit Regional Executive St. Louis Carolyn Chism Hardy, Chair Little Rock Seema Sheth, Senior Vice President and Regional Executive Lal Karsanbhai, Deputy Chair Jamie J. Henry, Chair Memphis Alberto G. Musalem, President Matuschka Lindo Briggs, and Chief Executive Officer Senior Vice President and Regional Tracy D. Hall, Chair Executive François G. Henriquez II, First Douglas G. Scarboro, Senior Vice President and Chief Operat- Louisville Vice President and Regional Executive ing Officer Emerson M. Goodwin, Chair

130 111th Annual Report | 2024 Minneapolis Chris Hilger, Chair Neel Kashkari, President and Helena Chief Executive Officer Paul D. Williams, Deputy Chair Alan D. Ekblad, Chair Ron J. Feldman, First Vice President and Chief Operating Officer Kansas City Patrick A. Dujakovich, Chair Denver Chad R. Wilkerson, Senior Vice President and Branch Executive Jandel Allen-Davis, Deputy Chair Navin Dimond, Chair Omaha Jeffrey Schmid, President Nicholas Sly, Assistant Vice and Chief Executive Officer President and Branch Executive L. Javier Fernandez, Chair Kim Robbins, First Vice President Oklahoma City Nathan Kauffman, Senior Vice and Chief Operating Officer President and Branch Executive Dana S. Weber, Chair Dallas Thomas J. Falk, Chair El Paso Daron D. Peschel, Senior Vice President and Regional Executive Claudia Aguirre, Deputy Chair Tracy J. Yellen, Chair San Antonio Lorie K. Logan, President and Roberto A. Coronado, Senior Chief Executive Officer Vice President and Senior Economist; Veronica Muzquiz Edwards, Interim Regional Executive Robert L. Triplett, III, First Vice Chair President and Chief Operating Officer Houston Armida Riojas, Assistant Vice President and Regional Executive Ruth J. Simmons, Chair San Francisco David P. White, Chair Los Angeles Salt Lake City Russell A. Childs, Deputy Chair Jack L. Sinclair, Chair O. Randall Woodbury, Chair Mary C. Daly, President and Chief Qiana Charles, Vice President and Abby McLennan, Vice President Executive Officer Regional Executive and Regional Executive Sarah Devany, First Vice President Portland Seattle and Chief Operating Officer Gale Castillo, Chair John Wolfe, Chair Additional office at Phoenix, AZ Ian Galloway, Vice President and Christina Prkic, Vice President Regional Executive and Regional Executive

Federal Reserve System Organization 131 Leadership Conferences Conference of Chairs The chairs of the Federal Reserve Banks are organized into the Conference of Chairs, which meets to consider matters of common interest and to consult with and advise the Board of Governors. Such meetings, also attended by the deputy chairs, were held in Washington, D.C., on May 8 and 9, 2024, and November 19 and 20, 2024. The conference’s executive committee members for 2024 are listed below.1 Conference of Chairs Executive Committee—2024 Corey Thomas, Chair, Patrick A. Dujakovich, Vice Jodie McLean, Member, Federal Reserve Bank of Chair, Federal Reserve Bank of Federal Reserve Bank of Richmond Boston Kansas City Conference of Presidents The presidents of the Federal Reserve Banks are organized into the Conference of Presidents, which meets periodically to identify, define, and deliberate issues of strategic significance to the Federal Reserve System; to consider matters of common interest; and to consult with and advise the Board of Governors. The chief executive officer of each Reserve Bank was originally labeled governor and did not receive the title of president until the passage of the Banking Act of 1935. Consequently, when the Conference was first established in 1914 it was known as the Conference of Governors. Conference officers for 2024 are listed below. Conference of Presidents—2024 John C. Williams, Chair, Heidy Medina, Secretary, Federal Federal Reserve Bank of New York Reserve Bank of New York Neel Kashkari, Vice Chair, Karmi Mattson, Assistant Federal Reserve Bank of Minneapolis Secretary, Federal Reserve Bank of Minneapolis 1 On November 19, 2024, the Conference of Chairs elected Patrick A. Dujakovich, chair of the Federal Reserve Bank of Kansas City, as chair of the conference's executive committee for 2025. The conference also elected Lisa M. Hamilton, deputy chair of the Federal Reserve Bank of Richmond, as vice chair of the executive committee for 2025, and Pat Wang, deputy chair of the Federal Reserve Bank of New York, as the executive committee's third member for 2025.

132 111th Annual Report | 2024 Conference of First Vice Presidents The Conference of First Vice Presidents of the Federal Reserve Banks was organized in 1969 to meet periodically for the consideration of operations and other matters. Conference officers for 2024 are listed below.2 Conference of First Vice Presidents—2024 Ron Feldman, Chair, Jamica Quillin, Secretary, Federal Reserve Bank of Minneapolis Federal Reserve Bank of Minneapolis Becky Bareford, Vice Chair, Nina Mantilla, Assistant Secretary, Federal Reserve Bank of Richmond Federal Reserve Bank of Richmond 2 On November 25, 2024, the conference elected Becky Bareford, Federal Reserve Bank of Richmond, as chair and Robert L. Triplett, III, Federal Reserve Bank of Dallas, as vice chair for 2025. The conference also elected Nina Mantilla, Federal Reserve Bank of Richmond, as secretary and Jordann Roberson, Federal Reserve Bank of Dallas, as assistant secretary.

133 B Minutes of Federal Open Market Committee Meetings The policy actions of the Federal Open Market Committee, recorded in the minutes of its meetings, are available in the Annual Report of the Board of Governors pursuant to the requirements of section 10 of the Federal Reserve Act. That section provides that the Board shall keep a complete record of the actions taken by the Board and by the Federal Open Market Committee on all questions of policy relating to open market operations, that it shall record therein the votes taken in connection with the determination of open market policies and the reasons underlying each policy action, and that it shall include in its annual report to Congress a full account of such actions. Links to the minutes for each of the eight regularly scheduled meetings held in 2024 are in the list below. Meeting Minutes • Meeting held on January 30–31, 2024 https://www.federalreserve.gov/monetarypolicy/files/fomcminutes20240131.pdf • Meeting held on March 19–20, 2024 https://www.federalreserve.gov/monetarypolicy/files/fomcminutes20240320.pdf • Meeting held on April 30–May 1, 2024 https://www.federalreserve.gov/monetarypolicy/files/fomcminutes20240501.pdf • Meeting held on June 11–12, 2024 https://www.federalreserve.gov/monetarypolicy/files/fomcminutes20240612.pdf • Meeting held on July 30–31, 2024 https://www.federalreserve.gov/monetarypolicy/files/fomcminutes20240731.pdf • Meeting held on September 17–18, 2024 https://www.federalreserve.gov/monetarypolicy/files/fomcminutes20240918.pdf • Meeting held on November 6–7, 2024 https://www.federalreserve.gov/monetarypolicy/files/fomcminutes20241107.pdf • Meeting held on December 17–18, 2024 https://www.federalreserve.gov/monetarypolicy/files/fomcminutes20241218.pdf

134 111th Annual Report | 2024 The minutes of the meetings contain the votes on the policy decisions made at those meetings, as well as a summary of the information and discussions that led to the decisions. The descriptions of economic and financial conditions in the minutes are based solely on the information that was available to the Committee at the time of the meetings. Members of the Committee voting for a particular action may differ among themselves as to the reasons for their votes; in such cases, the range of their views is noted in the minutes. When members dissent from a decision, they are identified in the minutes and a summary of the reasons for their dissent is provided. Policy directives of the Federal Open Market Committee are issued to the Federal Reserve Bank of New York as the Bank selected by the Committee to execute transactions for the System Open Market Account. Adoption of the policy directives during the year are reported in the minutes for the individual meetings.1 For more information about the Federal Open Market Committee’s meetings, statements, and minutes, visit the Board’s website at https://www.federalreserve.gov/monetarypolicy/ fomccalendars.htm. 1 The Federal Open Market Committee’s standard rules and authorizations in effect as of January 1, 2024, are available at https://www.federalreserve.gov/monetarypolicy/files/FOMC_RulesAuthPamphlet_202301.pdf. The rules and authorizations put into effect subsequently in 2024 are available at https://www.federalreserve.gov/monetarypolicy/files/ FOMC_RulesAuthPamphlet_202401.pdf.

135 C Federal Reserve System Audits The Board of Governors, the Federal Reserve Banks, and the Federal Reserve System as a whole are all subject to several levels of audit and review. The Board’s financial statements and internal controls over financial reporting are audited annually by an independent outside auditor retained by the Board’s Office of Inspector General (OIG). The outside auditor also tests the Board’s compliance with certain provisions of laws, regulations, and contracts affecting those statements. The Reserve Banks’ financial statements are audited annually by an independent outside auditor retained by the Board of Governors. In addition, the Reserve Banks are subject to annual examination by the Board. As discussed in section 5, “Payment System and Reserve Bank Oversight,” the Board’s examination includes a wide range of ongoing oversight activities conducted on site and off site by staff of the Board’s Division of Reserve Bank Operations and Payment Systems. The audited annual financial statements of the Board of Governors, the Reserve Banks, and the Federal Reserve System as a whole are available on the Board’s website at https://www.federalreserve.gov/aboutthefed/audited-annual-financial-statements.htm. In addition, the OIG conducts audits, evaluations, investigations, and other reviews relating to the Board’s programs and operations as well as to Board functions delegated to the Reserve Banks. Certain aspects of Federal Reserve operations are also subject to review by the Government Accountability Office. Office of Inspector General Activities The OIG for the Federal Reserve Board, which is also the OIG for the Consumer Financial Protection Bureau (CFPB), operates in accordance with the Inspector General Act of 1978, as amended. The OIG plans and conducts audits, evaluations, investigations, and other reviews relating to Board and CFPB programs and operations, including functions that the Board has delegated to the Federal Reserve Banks. It also retains an independent public accounting firm to annually audit the Board’s and the Federal Financial Institutions Examination Council’s financial statements. These activities promote economy and efficiency; enhance policies and procedures; and prevent and detect waste, fraud, and abuse. In addition, the OIG keeps Congress, the Board of Governors, and the CFPB director fully and currently informed about serious abuses and deficiencies.

136 111th Annual Report | 2024 During 2024, the OIG issued 22 reports, including 9 reports about Board programs and operations (table C.1). Because of the sensitive nature of some of the material, 2 of the 9 reports are nonpublic, as indicated. In addition, the OIG issued 6 information technology–related memorandum reports—3 on data analytics, which are posted to its website, and 3 on cybersecurity issues, which are not publicly available because of the sensitive nature of the information contained in them. The OIG also issued 2 semiannual reports to Congress and conducted follow-up reviews to evaluate the corrective actions taken to address its recommendations. Regarding the OIG’s investigative work related to the Board and the CFPB, 27 investigations were opened and 60 investigations were closed during the year. OIG investigative work resulted in 39 arrests, 7 criminal complaints, 27 criminal informations,115 indictments, 46 convictions, and 6 prohibitions from the banking industry, as well as more than $352 million in criminal fines, restitution, and special assessments. Although the federal government announced an end to the COVID-19 public health emergency on May 11, 2023, the OIG will continue its investigative work concerning the pandemic-related lending programs—in particular, investigations of alleged fraud—for the foreseeable future. Finally, the OIG performed 21 reviews of legislation and regulations related to the operations of the Board, the CFPB, or the OIG. For more information and to view the OIG’s publications, visit the OIG’s website at https://oig.federalreserve.gov. Specific details about the OIG’s body of work also may be found in the OIG’s Work Planand semiannual reports to Congress. Table C.1. Board reports issued by the OIG in 2024 Report title Month issued The Board Should Provide Staff With Guidance on Controlled Unclassified Information January Material Loss Review of Heartland Tri-State Bank February Results of Security Control Testing of the Board’s Projection Collection System (nonpublic) February Federal Financial Institutions Examination Council Financial Statements as of and for the Years Ended December 31, 2023 and 2022, and Independent Auditors’ Report February Board of Governors of the Federal Reserve System Financial Statements as of and for the Years Ended December 31, 2023 and 2022, and Independent Auditors’ Reports March Results of Security Control Testing of the Board’s Embargo Application (nonpublic) April FRB Minneapolis Followed Its Paycheck Protection Program Liquidity Facility Collateral Risk Management Processes and Can Enhance Monitoring and Collection Processes September The Board Can Strengthen Its Hiring Practices to Help Mitigate Bias and Reinforce Its Commitment to Ensuring a Diverse Workforce September 2024 Audit of the Board’s Information Security Program October 1 A criminal informationis a written accusation made by a public prosecutor, without the intervention of a grand jury.

Federal Reserve System Audits 137 Government Accountability Office Reviews The Federal Banking Agency Audit Act (Pub. L. No. 95–320) authorizes the Government Accountability Office (GAO) to audit certain aspects of Federal Reserve System operations. The Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 and the Coronavirus Aid, Relief, and Economic Security Act of 2020 direct the GAO to conduct additional audits with respect to these operations. In 2024, the GAO completed 12 projects that involved the Federal Reserve (table C.2). Fourteen projects were ongoing as of December 31, 2024 (table C.3). For more information and to view GAO reports, visit the GAO’s website at https://www.gao.gov.

138 111th Annual Report | 2024 Table C.2. GAO reports issued in 2024 Report title Report number Month publicly released Evictions: National Data Are Limited and Challenging to Collect GAO-24-106637 February Bank Supervision: More Timely Escalation of Supervisory Action Needed GAO-24-106974 March Federal Home Loan Banks: Actions Related to the Spring 2023 Bank Failures GAO-24-106957 April Economic Development: Additional Training Could Help Small Lenders Implement Technology GAO-24-106226 April Financial Services Regulations: Improvements Needed to Policies and Procedures for Regulatory Analysis GAO-24-106206 July Payment Scams: Information on Financial Industry Efforts GAO-24-107107 July Commercial Real Estate: Trends, Risks, and Federal Monitoring Efforts GAO-24-107282 September Financial Audit: Bureau of the Fiscal Service’s FY 2024 and FY 2023 Schedules of Federal Debt GAO-25-107138 November Bank Supervision: Federal Reserve and FDIC Should Address Weaknesses in Their Process for Escalating Supervisory Concerns GAO-25-106771 November Debt Limit: Statutory Changes Could Avert the Risk of a Government Default and Its Potentially Severe Consequences GAO-25-107089 December Currency Transaction Reports: Improvements Could Reduce Filer Burden While Still Providing Useful Information to Law Enforcement GAO-25-106500 December Federal Reserve Lending Programs: Nearly Half of Main Street Program Loans Are Fully Repaid, but Losses Have Increased GAO-25-107246 December Table C.3. Projects active at year-end 2024 Subject of project Month initiated Status Use of minority- and women-owned asset management firms in federal retirement plans and endowments June 2023 Open The 2023 systemic risk determinations August 2023 Closed 1/23/25 Older workers’ employment and finances during the pandemic September 2023 Open Executive compensation at failed banks October 2023 Closed 2/20/25 Peer-to-peer payment app scams November 2023 Closed 4/8/25 Artificial intelligence in financial services January 2024 Open Basel III endgame standards February 2024 Closed 3/26/25 Federal Home Loan Banks’ liquidity role during financial crises March 2024 Open Bureau of Labor Statistics’ Employment Situation Report June 2024 Open Banking services for cannabis businesses July 2024 Open Treasury debt management practices August 2024 Open Bankruptcies of financial companies September 2024 Open The role of independent auditors in bank failures October 2024 Open Veteran lending and access to credit November 2024 Open

139 D Federal Reserve System Budgets The Federal Reserve Board of Governors and the Federal Reserve Banks prepare annual budgets as part of their efforts to demonstrate strong stewardship and provide appropriate transparency.1 This section presents information on the 2024 budget performance of the Board and Reserve Banks and on their 2025 budgets (box 1), budgeting processes, and trends in expenses and employment. This section also presents information on the costs of new currency. Box 1. Implementation of the System’s 2025 Budget The Federal Reserve System’s budget represents the maximum amount that is authorized for particular purposes. It does not constitute an obligation to spend funds, and actual spending on budget items may be reduced or eliminated without formal amendment to the budget. Since the Board adopted its 2025 budget, a number of budget items have been reduced or eliminated, including not proceeding with certain information technology modernization initiatives at their originally budgeted levels. Similarly, since the adoption of the 2025 Reserve Bank budgets, the Reserve Banks initiated a reduction to the 2025 full-time equivalents (FTE) forecast to align with the underrun in actual 2024 year-end performance. As it has done historically, the Federal Reserve System has sought to align itself where appropriate and within the law with executive orders, including with the federal government hiring freeze. The Federal Reserve System also announced that it initiated a plan to reduce its overall headcount by 10 percent over the next few years. Initial Board efforts to this objective include offering a voluntary deferred resignation program and reevaluating its staffing needs related to the United States hosting the G-20 in 2026 and G-7 in 2027. Additionally, the Board and Reserve Banks are conducting a strategic evaluation to standardize operations and align operations to most strategic priorities to achieve staffing reductions. System Budgets Overview Tables D.1 and D.2 summarize the Federal Reserve Board of Governors’ and Federal Reserve Banks’ 2024 budgeted, 2024 actual, and 2025 budgeted operating expenses and employment.2 1 Before 2013, information about the budgeted expenses of the Board and Reserve Banks was presented in a separate report titled Annual Report: Budget Review. The report is available at https://www.federalreserve.gov/publications/ budget-review/default.htm. Each budget covers one calendar year. 2 Substantially all employees of the Board and Reserve Banks participate in the Retirement Plan for Employees of the Federal Reserve System (System Plan). Reserve Bank employees at certain compensation levels participate in the Benefit Equalization Plan, and certain Reserve Bank officers participate in the Supplemental Retirement Plan for Select Officers of the Reserve Banks. The operating expenses of the Reserve Banks presented in this section do not include expenses related to the retirement plans; however, the 2024 claims for reimbursement include the allocated portion of the pension. Additional information about these expenses can be found in Appendix G, “Statistical Tables.” Board employees also participate in the Benefit Equalization Plan, and Board officers participate in the Pension Enhancement Plan for Officers of the Board of Governors of the Federal Reserve System (PEP). The operating expenses of the Board presented in this section include expenses related to Board participants in the Benefit Equalization Plan and PEP but do not include expenses related to the System Plan.

140 111th Annual Report | 2024 Table D.1. Total operating expenses of the Federal Reserve System, net of receipts and claims for reimbursement, 2024–25 Millions of dollars, except as noted Variance Variance 2024 2024 2024 actual to 2025 2025 budget to Item budget actual 2024 budget budget 2024 actual Amount Percent Amount Percent Board1 1,070.2 1,049.9 −20.3 −1.9 1,168.6 118.6 11.3 Office of Inspector General2 39.6 40.1 0.5 1.4 41.3 1.2 3.0 Reserve Banks3 6,053.2 5,865.4 −187.7 −3.1 6,382.5 517.1 8.8 Currency4 1,368.6 1,242.3 −126.3 −9.2 1,263.6 21.3 1.7 Total System operating expenses 8,531.6 8,197.7 −333.8 −3.9 8,856.0 658.2 8.0 Revenue from priced services 501.4 524.4 23.0 4.6 531.7 7.3 1.4 Claims for reimbursement5 879.8 835.8 −43.9 −5.0 915.0 79.2 9.5 Revenue and claims for reimbursement6 1,381.2 1,360.2 −20.9 −1.5 1,446.7 86.5 6.4 Total System operating expenses, net of revenue and claims for reimbursement 7,150.4 6,837.5 −312.9 −4.4 7,409.3 571.7 8.4 Note: Here and in subsequent tables, components may not sum to totals and may not yield percentages shown because of rounding. 1 In December 2024, the Board approved an amended 2024 budget authority of $1,070.2 million. 2 In 2024, the Board approved a budget authority of $59.8 million. Total expenses, excluding operating income, were $58.7 million, which was $1.1 million, or 1.9 percent, lower than the budget authority. Operating income from the CFPB was $18.6 million, which was $1.6 million, or 8.1 percent, lower than the forecasted amount of $20.2 million. The OIG conducted more work related to the Board than planned, resulting in less operating income from the CFPB. This resulted in the net operating budget of $39.6 million and actual net expenses of $40.1 million. 3 Excludes Reserve Bank assessments by the Board of Governors for costs related to currency and the operations of the Board of Governors, OIG, and CFPB. 4 The 2024 and 2025 currency values reflect the sum of single-cycle and multicycle project costs. However, the Bureau of Engraving and Printing’s single-cycle and multicycle project budgets are tracked separately, as shown in tables D.13 and D.14, respectively. 5 Reimbursable claims include the expenses of fiscal agency. In 2024 actual, the fiscal agency allocated portion of the pension is also included but is not included for the budget. The fiscal agency budgeted pension expense is $47.4 million in 2024 and $51.9 million in 2025. 6 Excludes annual assessment fees for the supervision of large financial companies pursuant to Regulation TT. These fees are not recognized as revenue or used to fund Board expenses. In 2024, the Board collected and transferred $777.7 million to the U.S. Treasury. 2024 Budget Performance In carrying out its responsibilities in 2024, the Federal Reserve System incurred $6,837.5 million in net expenses. Total System operating expenses of $8,197.7 million were offset by $1,360.2 million in revenue from priced services and claims for reimbursement. Total 2024 System operating expenses, net of revenue and reimbursements, were $312.9 million, or 4.4 percent, less than the amount budgeted for 2024.

Federal Reserve System Budgets 141 Table D.2. Employment in the Federal Reserve System, 2024–25 Variance Variance 2024 2024 2024 actual to 2025 2025 budget to Item budget actual 2024 budget budget 2024 actual Amount Percent Amount Percent Board1 3,198 3,176 −22 −0.7 3,291 115 3.6 Office of Inspector General2 141 140 −1 −1.0 146 7 4.7 Reserve Banks 21,238 20,840 −398 −1.9 21,411 571 2.7 Currency 24 23 −1 −4.2 27 4 17.4 Total System employment 24,602 24,179 −423 −1.7 24,875 696 2.9 Note: Employment numbers are represented in full-time equivalents (FTE) to better align with Reserve Banks and industry. FTE represent an employee's scheduled hours divided by the employer’s hours for a full-time workweek. Parttime workers’ hours can be fractional, which means the variance may be off slightly. 1 In December 2024, the Board approved an amended 2024 budget authority. The 2024 budget amount is updated to reflect the Board's forecasted 2024 FTE amount. 2 In December 2024, the Board approved an amended 2024 budget authority. The 2024 budget amount is updated to reflect the OIG's forecasted 2024 FTE amount. 2025 Operating Expense Budget Budgeted 2025 System operating expenses of $7,409.3 million, net of revenue and reimbursements, are $571.7 million, or 8.4 percent, higher than 2024 actual expenses. The Reserve Bank budgets comprise almost three-quarters of the System budget (figure D.1). Trends in Expenses and Employment Figure D.1. Distribution of budgeted expenses of the Federal Reserve System, 2025 From the actual 2015 amount to the budgeted 2025 amount, the total operating expenses of Currency, 14.3% the Federal Reserve System have increased an average of 5.4 percent annually (figure D.2), which is slightly higher than the Board of Governors and OIG, 13.7% 10-year growth rate between 2014 and 2024. The total rate of growth in Federal Reserve Reserve Banks, System expenses reflects investments in tech- 72.1% nology initiatives, payment infrastructure mod- OIG: Office of Inspector General. ernization efforts, the next-generation currency-processing program NextGen, and resources to support the supervision portfolio and other national strategic initiatives (figure D.3).3 3 The System is implementing a strategy to transition the current fleet of high-speed currency processing machines and the associated sensor suite from the Banknote Processing System platform to the future NextGen processing technologies (machines and sensor technologies).

142 111th Annual Report | 2024 Figure D.2. Total expenses of the Federal Figure D.3. Employment in the Federal Reserve Reserve System, 2015–25 System, 2015–25 Billions of dollars Thousands of persons(cid:127) 10 25 9 Current dollars! 23 8 7 21 6 2015 dollars1! 19 5 4 17 3 15 2 2015 2017 2019 2021 2023 2025 1 0 Note: For 2025, budgeted. From 2015 to 2018, 2015 2017 2019 2021 2023 2025 employment numbers presented include position counts for the Board and the OIG and average number of personnel (ANP) for the Reserve Banks. From 2019 Note: For 2024–25, budgeted. Includes expenses to 2020, employment numbers for all entities are repof the OIG. resented in ANP. For 2021 to 2022, employment num- 1. Calculated with the GDP price deflator. bers presented include ANP for the Board and OIG and headcount for the Reserve Banks. For 2023 through 2025, employment numbers for all entities are represented by FTE. Expense growth in the monetary policy area represents continued investment in regional economic research and resources to support effective market operations and monitoring activities. Treasury services expenses have increased in response to Treasury’s request that Reserve Banks, as fiscal agents, modernize legacy applications and align with the federal government's cloud computing strategy. Expenses for services to financial institutions have increased as a result of the System's initiative to replace the existing, decades-old high-speed currency processing equipment with new equipment and technology. Growth in services to financial institutions and the public is also attributable to the addition of resources in support of the credit and liquidity facilities created in response to the COVID-19 pandemic. Supervision has experienced moderate growth over the past 10 years. Growth driven by changes in the state member bank portfolio, the buildout of the cybersecurity supervision program, and support for other national strategic initiatives was partially offset by adjustments to supervisory mandates from the Economic Growth, Regulatory Reform, and Consumer Protection Act, the identification and realization of operational efficiencies, and the prioritization of resources toward higher-

Federal Reserve System Budgets 143 risk activities and emerging risks. In particular, resources were temporarily shifted from supervision in 2020 and 2021 to support the credit and liquidity facilities responding to the COVID-19 pandemic. Most recently, resources have been added to align with supervisory portfolio growth, increased complexity of institutions, and other strategic initiatives impacting the banking industry. Growth in fee-based services is primarily for investments in payment infrastructure modernization efforts, including the FedNowSMService initiative, and investments associated with multiyear technology initiatives to modernize processing platforms for Fedwire and automated clearinghouse (ACH).4 2025 Capital Budgets The capital budgets for the Board and Reserve Banks total $531.8 million and $942.7 million, respectively.5As in previous years, the 2025 capital budgets include funding for projects that support the strategic direction outlined by the Board, System leadership, and each Reserve Bank. These strategic goals emphasize investments that continue to improve operational efficiencies, enhance services to Bank customers, and ensure a safe and productive work environment. Board of Governors Budgets Board of Governors The Board’s budget is based on the principles established by the Strategic Plan 2024–27and provides funding to advance the plan’s goals and objectives.6This functional alignment helps ensure organizational resources are used to advance the Board’s mission and provides a structure to fund strategic priorities over the four-year time horizon. The Board’s budget process is as follows: • At the start of the budget process, the chief operating officer and chief financial officer meet with the Committee on Board Affairs (CBA) to discuss budget recommendations for the Board’s operating budget. After engagement with the CBA, Division of Financial Management (DFM) staff communicate the budget recommendations to the Executive Committee, which comprises the directors of each division. 4 In July 2023, the Federal Reserve launched a new round-the-clock, real-time payment and settlement service called the FedNow Service to support faster payments in the United States. The initiative to modernize the ACH processing platform was completed in early 2021. 5 The capital budget reported for the Board includes single-year capital expenditures and 2025 expected capital expenditures from multiyear projects of the Board and the OIG. The capital budget reported for the Reserve Banks includes the amounts budgeted for the National Information Technology support function. 6 The Board approved the plan published in December 2023 and is located at https://www.federalreserve.gov/ publications/files/2024-2027-gpra-strategic-plan.pdf.

144 111th Annual Report | 2024 • Divisions develop budget proposals and allocate resources to highest priority areas and seek tradeoffs and efficiencies. In some instances, new initiatives are proposed, reviewed, and prioritized against existing operations and budgets. • DFM staff review initial budget requests submitted by divisions and collaborate with all divisions across all functional areas to develop budget recommendations.7 • The chief operating officer and chief financial officer subsequently brief the CBA on the budget submissions and recommendations. Once a final budget proposal is finalized, the Administrative Governor submits the budget to the full Board for review and final approval. • Throughout the year, DFM staff monitor expenses through financial forecasts that provide insight into budgetary trends. Staff analyze budgetary variances and trends and communicate the results to senior management. Tables D.3, D.4, and D.5 summarize the Board’s 2024 budgeted and actual expenses and its 2025 budgeted expenses by operating area; division, office, or special account; and account classification, respectively. Table D.6 summarizes the Board’s 2024 budgeted and actual authorized positions and its budgeted positions for 2025. Each table includes a line item for the Office of Inspector General (OIG), which is discussed later in this section. 2024 Budget Performance During 2024, uncontrollable factors within centrally managed benefits drove upward pressure to the 2024 budget. While staff use the latest and best estimates available when the budget is finalized, actuarial and demographic assumptions, economic conditions, and other factors contribute to variations in these benefits. In December 2024, the Board approved a 2024 budget authority of $1,070.2 million. Total expenses for Board operations were $1,049.9 million, which were $20.3 million, or 1.9 percent, lower than the budget authority. The Board’s 2024 single-year capital spending was $16.8 million, $8.2 million or nearly 32.9 percent less than budgeted. This variance was driven primarily by lower spending on equipment purchases, life-cycle replacements, and deferred automation projects. Multiyear capital projects spending in 2024 was higher than budgeted by $27.4 million, or 7.5 percent, driven by longlead items received earlier than expected within building improvement projects. Although 2024 7 Monetary Policy and Financial Stability, Supervision and Regulation, Payment System and Reserve Bank Oversight, Consumer Protection and Community Development, and Mission Advancement.

Federal Reserve System Budgets 145 Table D.3. Operating expenses of the Board of Governors, by operating area, 2024–25 Millions of dollars, except as noted Variance Variance 2025 budget to Item b 2 ud 0 g 2 e 4 t1 a 2 c 0 tu 2 a 4 l 2 2 0 0 2 2 4 4 a b c u tu d a g l e t t o b 2 u 0 d 2 g 5 et 2024 actual Amount Percent Amount Percent Monetary policy and financial stability2 457.4 449.4 −8.0 −1.7 518.5 69.1 15.4 Supervision and regulation 447.0 438.0 −9.1 −2.0 465.7 27.7 6.3 Payment system and Reserve Bank oversight 89.0 87.2 −1.9 −2.1 89.8 2.6 3.0 Consumer protection and community development3 76.7 75.4 −1.3 −1.7 94.6 19.2 25.5 Total, Board operations 1,070.2 1,049.9 −20.3 −1.9 1,168.6 118.6 11.3 Office of Inspector General 39.6 40.1 0.5 1.4 41.3 1.2 3.0 Note: This table presents financial performance for the Board’s operating areas, which align with the Reserve Banks. Payment system and Reserve Bank oversight is an operating area unique to the Board. 1 In December 2024, the Board approved an amended 2024 budget authority for the Board and OIG. OIG totals reflect the total operating budget net of expected earned income from the CFPB. 2 Includes the Survey of Consumer Finances. 3 2025 growth within Consumer Protection and Community Development is affected by shifting of IT resources to the statistics function. expenditures for multiyear capital projects were higher than budgeted, multiyear projects are still projected to be within their total project budgets. Table D.7 summarizes the Board’s budgeted and actual capital expenditures for 2024 and 2025. 2025 Operating Expense Budget The 2025 budget for Board operations is $1,168.6 million, which is $118.6 million, or 11.3 percent, higher than 2024 actual expenses. The operating budget reflects investments to advance the Board’s priorities across five goal areas to maintain the stability, integrity, and efficiency of the nation’s monetary, financial, and payment systems. The 2025 budget includes strategic investments in the Board’s data and technology environment and the processes used for forecasting and modeling, short-term (non-permanent) support for upcoming G–20 and G–7 meetings, and funding to support the Board’s triennial Survey of Consumer Finances. Authorized positions for 2025 are 3,057, an increase of 47 positions from the 2024 authorized number.

146 111th Annual Report | 2024 Table D.4. Operating expenses of the Board of Governors, by division, office, or special account, 2024–25 Millions of dollars, except as noted Variance Variance 2024 2024 2024 actual to 2025 2025 budget to Division, office, or special account budget1 actual 2024 budget budget 2024 actual Amount Percent Amount Percent Research and Statistics 116.9 117.3 0.4 0.3 125.3 8.0 6.8 International Finance 47.9 47.7 −0.2 −0.4 55.9 8.2 17.1 Monetary Affairs 55.7 55.2 −0.5 −0.9 58.9 3.7 6.7 Financial Stability 23.7 23.5 −0.1 −0.6 26.9 3.3 14.1 Supervision and Regulation 141.9 139.8 −2.0 −1.4 152.3 12.4 8.9 Consumer and Community Affairs 43.3 43.4 0.1 0.2 47.6 4.2 9.7 Reserve Bank Operations and Payment Systems 55.8 55.6 −0.2 −0.3 59.7 4.0 7.2 Board Members 33.6 33.2 −0.4 −1.1 35.2 2.0 6.1 Secretary 13.7 13.5 −0.2 −1.5 15.5 2.0 14.8 Legal 41.5 40.9 −0.6 −1.3 44.3 3.4 8.3 Chief Operating Officer 20.0 19.9 −0.1 −0.5 23.1 3.2 15.9 Financial Management 17.6 17.4 −0.2 −1.1 18.7 1.3 7.7 Information Technology 187.0 187.5 0.5 0.3 209.9 22.4 12.0 Management 200.4 200.9 0.5 0.3 218.8 17.9 8.9 Centrally managed benefits2 38.6 35.7 −2.9 −7.4 42.4 6.7 18.8 Extraordinary items3 43.7 40.6 −3.0 −7.0 39.8 −0.8 −2.1 Savings and reallocations4 −12.3 −23.8 −11.5 93.4 −25.4 −1.6 6.7 Survey of Consumer Finances5 1.4 1.5 0.1 6.4 19.8 18.3 1,217.4 Total, Board operations 1,070.2 1,049.9 −20.3 −1.9 1,168.6 118.6 11.3 Office of Inspector General 39.6 40.1 0.5 1.4 41.3 1.2 3.0 1 In December 2024, the Board approved an amended 2024 budget authority for the Board and OIG. OIG totals reflect the total operating budget net of expected earned income from the CFPB. 2 Includes retirement and post-retirement benefits, accrued annual leave, and Office of Employee Benefits administrative assessment. 3 Includes the NextGen transformation project, centralized position pool, centralized data accounts, and other programs. 4 Includes Board support and overhead allocations to the OIG and Currency. Includes the amended budget authority. 5 The survey collects information about family incomes, net worth, balance sheet components, credit use, and other financial outcomes, and is conducted every three years.

Federal Reserve System Budgets 147 Table D.5. Operating expenses of the Board of Governors, by account classification, 2024–25 Millions of dollars, except as noted Variance Variance 2024 2024 2024 actual to 2025 2025 budget to Account classification budget1 actual 2024 budget budget 2024 actual Amount Percent Amount Percent Personnel services Salaries 617.4 616.2 −1.2 −0.2 659.2 43.0 7.0 Outside agency help 53.1 51.5 −1.6 −3.0 51.1 −0.4 −0.8 Retirement, insurance, and benefits 118.9 120.6 1.7 1.4 128.3 7.8 6.4 Pension and post-retirement benefits 22.2 21.5 −0.8 −3.5 25.8 4.3 20.1 Subtotal, personnel services 811.6 809.7 −1.8 −0.2 864.4 54.7 6.7 Goods and services Contractual services and professional fees 47.4 44.2 −3.2 −6.8 66.6 22.4 50.8 Rentals 44.6 44.1 −0.5 −1.1 39.3 −4.9 −11.0 Data, news, and research 26.3 25.3 −0.9 −3.6 48.9 23.6 93.2 Software 43.3 43.6 0.3 0.6 58.0 14.4 33.1 Furniture, equipment, postage, and supplies 6.4 6.4 0.0 −0.1 7.6 1.2 19.0 Repairs and maintenance 15.2 15.0 −0.2 −1.1 16.1 1.0 7.0 Utilities 9.2 9.2 0.0 −0.3 8.1 −1.1 −11.5 Travel 8.8 8.1 −0.7 −7.9 10.7 2.6 32.1 Other expenses 18.7 15.8 −2.9 −15.8 23.8 8.0 51.1 Depreciation/amortization 57.1 57.5 0.3 0.6 55.4 −2.1 −3.6 Support and overhead allocations2 −12.5 −23.8 −11.3 90.7 −25.4 −1.6 6.7 Earned revenue −5.9 −5.1 0.8 −13.5 −4.9 0.2 −3.6 Subtotal, goods and services 258.6 240.2 −18.4 −7.1 304.2 64.0 26.6 Total, Board operations 1,070.2 1,049.9 −20.3 −1.9 1,168.6 118.6 11.3 Office of Inspector General (OIG) Personnel services 37.4 36.7 −0.7 −1.9 39.4 2.7 7.4 Goods and services3 22.4 22.0 −0.4 −1.8 23.1 1.1 5.2 Subtotal, excluding operating income 59.8 58.7 −1.1 −1.9 62.5 3.8 6.6 Operating income4 −20.2 −18.6 1.6 −8.1 −21.2 −2.6 14.2 Total, OIG operations 39.6 40.1 0.5 1.4 41.3 1.2 3.0 1 In December 2024, the Board approved an amended 2024 budget authority for the Board and OIG. 2 Includes a net zero transfer of costs from the Board operating budget to the OIG and Currency operating budgets for Board support and overhead expenses attributable to the OIG and Currency. Includes the amended budget authority. 3 Includes Board support and overhead allocations to the OIG. 4 Represents earned income from the CFPB. 2025 Capital Budgets The Board’s 2025 single-year capital budget is $20.9 million, which is $4.0 million, or 24 percent, higher than 2024 actual capital expenditures. The growth is driven by routine building life-cycle replacements and an accounting threshold change for bulk purchases. The Board’s multiyear capital budget is driven by building improvements and funding for information technology investments. Expected capital expenditures in 2025 total $510.7 million and reflect the Board’s commitment to provide a secure, modern environment that meets the needs of

148 111th Annual Report | 2024 Table D.6. Positions authorized by the Board of Governors, by division, office, or special account, 2024–25 Variance Variance 2024 2024 2024 actual to 2025 2025 budget to Division, office, or special account budget actual 2024 budget budget 2024 actual Amount Percent Amount Percent Research and Statistics 368 368 0 0.0 370 2 0.5 International Finance 170 171 1 0.6 172 1 0.6 Monetary Affairs 190 191 1 0.5 192 1 0.5 Financial Stability 83 83 0 0.0 84 1 1.2 Supervision and Regulation 499 499 0 0.0 499 0 0.0 Consumer and Community Affairs 139 139 0 0.0 139 0 0.0 Reserve Bank Operations and Payment Systems 191 191 0 0.0 191 0 0.0 Board Members 127 127 0 0.0 127 0 0.0 Secretary 55 55 0 0.0 55 0 0.0 Legal 139 139 0 0.0 139 0 0.0 Chief Operating Officer 64 66 2 3.1 71 5 7.6 Financial Management 72 72 0 0.0 74 2 2.8 Information Technology 420 420 0 0.0 438 18 4.3 Management 485 485 0 0.0 487 2 0.4 Extraordinary items1 5 4 −1 −20.0 19 15 375.0 Total, Board operations 3,007 3,010 3 0.1 3,057 47 1.6 Office of Inspector General 152 152 0 0.0 152 0 0.0 Currency 24 24 0 0.0 27 3 12.5 Note: Budget represents authorized position count at the beginning of the year, and actual represents authorized position count at year-end. 1 Centralized position pool used for strategic areas of growth. the Board’s workforce and leverages opportunities to increase collaboration, efficiency, and productivity. Table D.7 summarizes the Board’s budgeted and actual capital expenditures for 2024 and 2025. Office of Inspector General The budget for the Board’s OIG is grounded in the goals established in its strategic plan. In keeping with its statutory independence, the OIG prepares its proposed budget separate and apart from the Board’s budget. The OIG presents its budget directly to the Board for approval. 2024 Budget Performance In December 2024, the Board approved a budget authority of $59.8 million. Total expenses for OIG operations, excluding operating income, were $58.7 million, which was $1.1 million, or 1.9 percent, lower than the budget authority.

Federal Reserve System Budgets 149 Table D.7. Capital expenditures of the Board of Governors, by capital type, 2024–25 Variance Variance 2024 2024 2024 actual to 2025 2025 budget to Item budget actual 2024 budget budget 2024 actual Amount Percent Amount Percent Board Single-year capital expenditures 25.1 16.8 −8.2 −32.9 20.9 4.0 24.0 Multiyear capital expenditures 364.3 391.7 27.4 7.5 510.7 119.0 30.4 Total capital expenditures 389.4 408.5 19.2 4.9 531.6 123.1 30.1 Office of Inspector General (OIG) Single-year capital expenditures 0.5 0.2 −0.3 −63.4 0.2 0.0 3.1 Multiyear capital expenditures 0.0 0.0 0.0 n/a 0.0 0.0 n/a Total capital expenditures 0.5 0.2 −0.3 −63.4 0.2 0.0 3.1 Board and OIG total capital expenditures 389.9 408.7 18.8 4.8 531.8 123.1 30.1 Note: The amount reported for the multiyear capital budget represents the expected expenditure for the budget year. n/a Not applicable. The OIG provides independent oversight of the Board and the Consumer Financial Protection Bureau (CFPB). Both agencies contribute to the OIG’s budget based on the allocation of work attributed to each. Operating income from the CFPB was $18.6 million, which was $1.6 million, or 8.1 percent, lower than the forecasted amount of $20.2 million. The OIG conducted more work related to the Board than planned, resulting in less operating income from the CFPB. Including operating income from the CFPB, total expenses for OIG operations were $40.1 million in 2024. The OIG’s single-year capital spending was $0.2 million, which was $0.3 million, or 63.4 percent, less than the budgeted amount. Table D.5 summarizes the OIG’s 2024 budgeted and actual expenses and table D.7 summarizes the OIG’s 2024 budgeted and actual capital expenditures. 2025 Operating Expense Budget The 2025 budget for OIG operations, excluding operating income, is $62.5 million, which is $3.8 million, or 6.6 percent, higher than 2024 actual expenses. Including operating income from the CFPB, the 2025 budget for OIG operations is $41.3 million. The OIG has 152 authorized positions for 2025, which is no change from the 2024 authorized number. 2025 Capital Budget The OIG’s single-year capital budget is $0.2 million, which is consistent with 2024 actual capital expenditures. The budget includes funding for equipment purchases and life-cycle replacements.

150 111th Annual Report | 2024 Table D.5 summarizes the OIG’s 2025 budgeted expenses, and table D.7 summarizes the OIG’s budgeted capital expenditures for 2025. Federal Reserve Banks Budgets Each Reserve Bank establishes operating goals for the coming year that reflect the System’s key strategic objectives as endorsed by the Board of Governors, to devise strategies for attaining those goals, to estimate required resources, and to monitor results. The Reserve Banks structure their budgets around specific functional areas reflecting the core responsibilities of the Federal Reserve: • contributing to the formulation of monetary policy and enhancing monetary policy implementation to become more effective, flexible, and resilient • promoting financial stability through effective monitoring, analysis, and policy development • promoting safety and soundness of financial institutions through effective supervision • leading efforts to enhance the security, resiliency, functionality, and efficiency of services provided to financial institutions, to the U.S. Treasury as its fiscal agent, and to the public The Reserve Bank budget process is as follows: • The Conference of Presidents, working closely with the Conference of First Vice Presidents (CFVP), structured itself such that five umbrella committees would be responsible for major operational and functional areas.8The umbrella committees are chaired by Reserve Bank Presidents and comprise Presidents and First Vice Presidents. These committees matured their roles in the budgeting process by setting budget priorities that aligned with the System’s longterm strategies. • The chair of each umbrella committee sits on the Committee on Spend Stewardship (CSS). The CSS defines, in close consultation with the Board’s Committee on Federal Reserve Bank Affairs (BAC), key strategic objectives for the System. Considering long-term environmental trends and historical growth rates of expense, these governance bodies articulate an aggregate Systemlevel growth expectation for the budget year. • With guidance from the CSS, the 12 Reserve Banks develop budgets that reflect the System’s strategic priorities, relying heavily on framing and making appropriate tradeoffs. These budgets are reviewed by each Reserve Bank’s senior leadership and respective board of directors. • The Reserve Banks submit for Board review preliminary budget information, including documentation to support the budget request. 8 The five umbrella committees are (1) Governance and Risk; (2) People; (3) Payments; (4) Technology and Operations; and (5) Research, Banking, Communities, and Communications.

Federal Reserve System Budgets 151 • Board staff analyzes these budgets, both individually and in the aggregate, with a focus on the overall System strategy and its articulation through resource decisions before providing its recommendations to the BAC. • Expenses associated with services provided to the Treasury require authorization from the Bureau of the Fiscal Service. • The BAC reviews the Banks’ budgets. • The Reserve Banks make any needed changes and the BAC chair submits the revised budgets to Board members for review and final approval. • Throughout the year, Reserve Bank and Board staffs monitor actual performance and compare it with approved budgets and forecasts. In addition to the budget approval process, the Reserve Banks must submit proposals for certain capital expenditures to the Board for further review and approval. Tables D.8, D.9, and D.10 summarize the Reserve Banks’ 2024 budgeted and actual expenses and 2025 budgeted expenses by Reserve Bank, functional area, and account classification.9 Table D.11 shows the Reserve Banks’ budgeted and actual employment for 2024 and budgeted employment for 2025. In addition, table D.12 shows the Reserve Banks’ budgeted and actual capital expenditures for 2024 and budgeted capital for 2025. 2024 Budget Performance Total 2024 operating expenses for the Reserve Banks were $5,865.4 million, which is $187.7 million, or 3.1 percent, less than the approved 2024 budget of $6,053.2 million. Budget performance reflects slower-than-expected onboarding of planned incremental resources, increased turnover, and program delays related to the Accelerate: Cloud and Colo Program (ACC), Common Data Platform (CDP), and Federal Reserve Financial Services (FRFS) cloud migration. Actual full-time equivalents (FTE) was 20,840, an underrun of 398 FTE, or 1.9 percent, from 2024 budgeted staffing levels. The Reserve Banks’ 2024 capital expenditures were less than budgeted by $136.6 million, or 15.0 percent, primarily driven by delays in critical System investments. 2025 Operating Expense Budget The 2025 operating budgets of the Reserve Banks total $6,382.5 million, which is $517.1 million, or 8.8 percent, higher than 2024 actual expenses.10Growth in monetary policy expense reflects staffing to support regional economic research. Treasury growth is primarily attributable to the Treasury’s request that Reserve Banks, as fiscal agents, modernize legacy applications and migrate applications to a cloud platform in alignment with the federal government’s cloud 9 Additional information about the operating expenses of each of the Reserve Banks can be found in Appendix G, “Statistical Tables” (see “Table G.9. Income and expenses of the Federal Reserve Banks, by Bank”). 10On December 15, 2024, the Board approved the 2025 Reserve Bank operating budgets totaling $6,382.5 million. Additional information is available at https://www.federalreserve.gov/foia/budgets.htm.

152 111th Annual Report | 2024 Table D.8. Operating expenses of the Federal Reserve Banks, by District, 2024–25 Millions of dollars, except as noted Variance Variance 2024 2024 2024 actual to 2025 2025 budget to District budget actual 2024 budget budget 2024 actual Amount Percent Amount Percent Boston 438.2 431.0 −7.2 −1.7 460.0 29.0 6.7 New York 1,364.1 1,315.6 −48.5 −3.6 1,428.1 112.5 8.6 Philadelphia 243.9 242.9 −1.0 −0.4 257.9 15.0 6.2 Cleveland 330.0 310.6 −19.4 −5.9 345.9 35.3 11.4 Richmond 418.4 394.7 −23.7 −5.7 429.9 35.2 8.9 Atlanta 530.4 516.2 −14.2 −2.7 552.2 36.0 7.0 Chicago 557.6 541.4 −16.2 −2.9 578.9 37.5 6.9 St. Louis 491.6 476.8 −14.9 −3.0 518.7 41.9 8.8 Minneapolis 302.2 307.2 5.0 1.7 331.5 24.3 7.9 Kansas City 484.9 460.5 −24.5 −5.0 503.7 43.2 9.4 Dallas 334.5 330.6 −3.9 −1.2 376.2 45.6 13.8 San Francisco 557.2 538.1 −19.2 −3.4 599.6 61.5 11.4 Total Reserve Bank operating expenses 6,053.2 5,865.4 −187.7 −3.1 6,382.5 517.1 8.8 Note: Includes expenses of the National IT (NIT) support function and reflects allocations for all indirect services. Excludes Reserve Bank capital expenditures as well as assessments by the Board of Governors for costs related to currency and the operations of the Board of Governors and the Consumer Financial Protection Bureau. Table D.9. Operating expenses of the Federal Reserve Banks, by operating area, 2024–25 Millions of dollars, except as noted Variance Variance 2024 2024 2024 actual to 2025 2025 budget to Operating area budget actual 2024 budget budget 2024 actual Amount Percent Amount Percent Monetary and economic policy 928.8 902.9 −25.9 −2.8 961.1 58.2 6.4 Services to the U.S. Treasury and other government agencies 819.8 774.6 −45.2 −5.5 852.0 77.3 10.0 Services to financial institutions and the public1 1,744.7 1,712.5 −32.3 −1.8 1,870.1 157.6 9.2 Supervision and regulation 1,784.5 1,732.5 −52.1 −2.9 1,902.0 169.5 9.8 Fee-based services to financial institutions2 775.2 742.7 −32.6 −4.2 797.4 54.7 7.4 Total Reserve Bank operating expenses3 6,053.2 5,865.4 −187.7 −3.1 6,382.5 517.4 8.8 1 Includes cash services. 2 Includes expenses associated with the priced services, including Check, FedACH, Fedwire Funds and National Settlement, Fedwire Securities, and FedNow. 3 Excludes the pension costs, reimbursements, and operating expense of the Board of Governors (see table D.4).

Federal Reserve System Budgets 153 Table D.10. Operating expenses of the Federal Reserve Banks, by account classification, 2024–25 Millions of dollars, except as noted Variance Variance Account 2024 2024 2024 actual to 2025 2025 budget to classification budget actual 2024 budget budget 2024 actual Amount Percent Amount Percent Salaries and other benefits1 4,436.6 4,321.2 −115.4 −2.6 4,670.8 349.6 8.1 Building 313.4 314.3 0.9 0.3 318.6 4.3 1.4 Software costs 579.6 548.8 −30.8 −5.3 662.2 113.4 20.7 Equipment 267.3 264.0 −3.3 −1.2 278.8 14.8 5.6 Recoveries −241.9 −242.0 −0.1 0.1 −245.7 −3.6 1.5 Expenses capitalized −202.0 −160.8 41.1 −20.4 −206.6 −45.7 28.4 All other2 900.1 820.0 −80.1 −8.9 904.4 84.4 10.3 Total Reserve Bank operating expenses 6,053.2 5,865.4 −187.7 −3.1 6,382.5 517.1 8.8 1 Includes salaries, other personnel expense, and retirement and other employment benefit expenses. It does not include pension expenses related to all the participants in the Retirement Plan for Employees of the Federal Reserve System and the Reserve Bank participants in the Benefit Equalization Plan and the Supplemental Retirement Plan for Select Officers of the Federal Reserve Banks. These expenses are recorded as a separate line item in the financial statements; see “Table G.9. Income and expenses of the Federal Reserve Banks, by Bank” in Appendix G, “Statistical Tables.” 2 Includes fees, materials and supplies, travel, communications, and shipping. Table D.11. Employment at the Federal Reserve Banks, by District, and of FRIT, 2024–25 Variance Variance 2024 2024 2024 actual to 2025 2025 budget to District budget actual 2024 budget budget 2024 actual Amount Percent Amount Percent Boston 1,296 1,276 −19 −1.5 1,321 45 3.5 New York 3,073 2,997 −76 −2.5 3,095 98 3.3 Philadelphia 884 877 −7 −0.7 905 28 3.2 Cleveland 1,114 1,084 -31 −2.8 1,156 73 6.7 Richmond 1,617 1,570 −47 −2.9 1,607 37 2.3 Atlanta 1,780 1,745 −35 −2.0 1,765 20 1.2 Chicago 1,726 1,645 −80 −4.7 1,731 86 5.2 St. Louis 1,508 1,525 17 1.2 1,523 −2 −0.1 Minneapolis 1,147 1,127 −19 −1.7 1,173 46 4.1 Kansas City 2,072 2,028 −44 −2.1 2,075 47 2.3 Dallas 1,343 1,352 9 0.7 1,342 −10 −0.7 San Francisco 1,910 1,864 −46 −2.4 1,928 64 3.4 Total, all Districts 19,468 19,090 −378 -1.9 19,622 531 2.8 Federal Reserve Information Technology (FRIT)1 1,770 1,750 −20 −1.1 1,789 39 2.3 Total 21,238 20,840 −398 −1.9 21,411 571 2.7 1 Reflects a subset of National IT employees.

154 111th Annual Report | 2024 Table D.12. Capital expenditures of the Federal Reserve Banks, by District, and of NIT, 2024–25 Millions of dollars, except as noted Variance Variance 2024 2024 2024 actual to 2025 2025 budget to District budget actual 2024 budget budget 2024 actual Amount Percent Amount Percent Boston 59.3 22.4 −36.8 −62.1 33.2 10.8 47.9 New York 183.1 145.9 −37.2 −20.3 180.3 34.4 23.6 Philadelphia 22.4 12.7 −9.7 −43.4 30.3 17.6 138.7 Cleveland 31.4 26.3 −5.1 −16.2 48.3 21.9 83.3 Richmond 18.2 18.6 0.4 2.1 21.9 3.3 17.6 Atlanta 145.9 84.3 −61.7 −42.3 180.2 96.0 113.9 Chicago 30.3 30.6 0.3 0.9 34.4 3.8 12.6 St. Louis 32.9 34.6 1.7 5.2 28.6 −6.0 −17.3 Minneapolis 30.7 18.2 −12.5 −40.6 32.6 14.3 78.7 Kansas City 63.9 59.2 −4.7 −7.4 65.7 6.5 10.9 Dallas 48.1 47.6 −0.5 −1.0 71.1 23.4 49.2 San Francisco 118.2 145.0 26.8 22.7 155.9 10.9 7.5 Total, all Districts 784.4 645.5 −138.9 −17.7 882.4 236.9 36.7 National IT 129.5 131.7 2.3 1.8 60.2 −71.5 −54.3 Total 913.9 777.2 −136.6 −15.0 942.7 165.4 21.3 computing strategy. Cash investments reflect increases across several Districts to support local implementations for the NextGen program.11Supervision resource additions align with portfolio growth. Investments in fee-based services are for resource needs to meet cloud migration deadlines and software costs for FedLine and the project to implement ISO 20022 for the Fedwire Funds service. Total 2025 budgeted employment for the Reserve Banks and Federal Reserve Information Technology (FRIT) is 21,411 FTE, an increase of 571, or 2.7 percent, from 2024 actual employment levels.12 Reserve Bank officer and staff personnel expenses for 2025 total $4,670.8 million, an increase of $349.6 million, or 8.1 percent, from 2024 actual expenses. The increase reflects expenses associated with additional staff, salary administration, variable pay, and retirement and other benefit costs.13 11FedCash is transitioning the existing fleet of high-speed currency processing machines and the sensor suite from the Banknote Processing System platform to the future NextGen processing infrastructure. 12FRIT is the portion of National IT, at the Richmond Bank, that supplies national infrastructure and business line technology services to the Federal Reserve System. 13The salary administration program includes a budgeted pool for merit increases, equity adjustments, and promotions.

Federal Reserve System Budgets 155 The 2025 Reserve Bank budgets include a salary administration program for eligible officers, senior professionals, and staff totaling $135.4 million and a variable pay program totaling $294.2 million. 2025 Capital Budgets The 2025 capital budgets for the Reserve Banks and National IT total $942.7 million. The increase in the 2025 capital budget is $165.4 million, or 21.3 percent, greater than the 2024 actual levels of $777.2 million, and includes ongoing, multiyear, strategic IT initiatives, investments in cash services, and building projects. Initiatives in the 2025 capital budget support ongoing multiyear building investments related to the maintenance of aging buildings, construction of a new cash services center, deployment of currency processors as part of the NextGen program, and the expansion of a cash vault. Increases are also for IT infrastructure investments, including the ACC Program. Capital Expenditures Designated for Conditional Approval The BAC chair designated projects with an aggregate cost of $312.4 million in 2025 for conditional approval, requiring additional review and approval by the director of the Board’s Division of Reserve Bank Operations and Payment Systems (RBOPS) before the funds are committed.14The expenditures designated for conditional approval comprise investments in technology related to the System’s ACC Program as well as large-scale projects related to the development and deployment of currency processors as part of the NextGen program, markets-related initiatives, the Treasury Retail Investment Manager (TRIM), and building upgrades related to the future of work and certain building renovation programs. Other Capital Expenditures Significant capital expenditures (typically expenditures exceeding $1 million) that are not designated for conditional approval include total multiyear budgeted expenditures of $1,645.4 million for 2025 and future years, of which the single-year 2025 budgeted expenditures are $557.6 million. This category includes necessary infrastructure investments for building and IT projects, and applications support for cash, fee-based services, monetary policy, and supervision initiatives. Capital initiatives that are individually less than $1 million are budgeted at an aggregate amount of $72.7 million for 2025 and include building maintenance expenditures, scheduled software and equipment upgrades, and equipment and furniture replacements. 14Generally, capital expenditures that are designated for conditional approval include certain building projects, District expenditures that substantially affect or influence future System direction or the manner in which significant services are performed, expenditures that may be inconsistent with System direction or vary from previously negotiated purchasing agreements, and local expenditures that duplicate national efforts.

156 111th Annual Report | 2024 Currency Budget The currency budget provides funds to reimburse the Treasury’s Bureau of Engraving and Printing (BEP) for expenses necessarily incurred related to the production of banknotes, and the Board’s activities related to its role as issuing authority of the nation’s currency in the form of Federal Reserve notes.15As the issuing authority, the Board is responsible for ensuring that there is an adequate supply of banknotes in circulation, that the banknotes meet defined quality standards to function in commerce, and that any security features or new designs are robust against counterfeiting. To support the Board’s role, the budget includes BEP note production costs, consistent with the annual calendar year print order submitted by the director of RBOPS on behalf of the Board. The budget also funds Board costs to ship new currency from the BEP to Reserve Banks, ship currency between the Reserve Banks, and cover program management expenses to support long-term issuance strategies and resiliency.16 Program management expenses include work by Board staff, done in collaboration with the Reserve Banks, the Treasury Department, the BEP, and the U.S. Secret Service, to ensure that notes meet quality standards to be able to function in commerce and have suitable security and design features to discourage or prevent counterfeiting. In addition, the Board plays a central role in protecting the integrity of, and maintaining public confidence in, U.S. currency. The U.S. Currency Program (USCP) stakeholders perform development and testing of security features and designs in support of the next banknote family.17Board staff monitors counterfeiting threats for each denomination and conducts adversarial analysis to ensure resistance to counterfeiting. The currency budget also funds the currency education program, which aims to protect and maintain confidence in U.S. currency worldwide by facilitating counterfeit-detection trainings for Reserve Bank and foreign central bank staff and educating the public about banknote security features. The currency education program also conducts outreach on USCP initiatives to key stakeholders, including commercial banks, retailers, cash-intensive industries, and law enforcement agencies. 15As mandated by the Federal Reserve Act, section 16, the Board reimburses the BEP for all necessary costs related to the production of Federal Reserve notes. Section 16 of the Federal Reserve Act also requires that all costs necessarily incurred for the issuing of notes shall be paid for by the Board and included in its assessments to the Reserve Banks. BEP operations expenses and capital investments have been generally financed by a revolving fund that is reimbursed through product sales, nearly all of which are sales of Federal Reserve notes to the Board to fulfill its annual print order. 16The Board delivers the annual print order to the BEP director every year which is available on the Board’s website at https://www.federalreserve.gov/paymentsystems/coin_currency_orders.htm. 17USCP stakeholders include the Federal Reserve, BEP, Treasury Department, and U.S. Secret Service.

Federal Reserve System Budgets 157 The annual currency budget process is as follows: • Each year, under authority delegated by the Board, the director of RBOPS submits a calendar year print order for banknotes to the director of the BEP. • The BEP forecasts expenses for the single-cycle calendar-year and multicycle project budgets. The single-cycle budget includes fixed and variable costs for printing Federal Reserve notes and support costs. The multicycle budget includes costs related to significant capital investments. • Board staff develops budgets for Board expenses consistent with strategic guidance set by the RBOPS officer responsible for the cash program of work. • The sections of the budget are independently reviewed by Board staff members, who also prepare a consolidated budget recommendation for BAC and Board approval. • The BAC reviews the proposed currency budget. • The BAC chair submits the proposed currency budget to Board members for review and final approval. 2024 Budget Performance BEP Single-Cycle Operating Costs BEP single-cycle operating costs were $976.6 million, which was $57.1 million, or 5.5 percent, below the budgeted amount for 2024. The budget underrun was primarily attributable to lower variable printing costs as BEP and Board staff agreed to reduce the print order to reflect updated demand trends for certain denominations. BEP fixed printing costs were below budget because of a mix of IT and facilities capital project expenditures that were pushed to 2025. Board Single-Cycle Operating Costs Board costs were $56.7 million, which was $13.5 million, or 19.3 percent, under the budgeted amount for 2024. The primary drivers were lower currency issuance costs for banknote transportation and an underrun in banknote development. Lower currency issuance costs were due to reduced demand, healthy inventory levels across the System, and lower-than-expected transportation contract price increases. Banknote development’s underrun was primarily due to scope changes to contracts and decreased membership fees for the Central Bank Counterfeit Deterrence Group. 2025 Budget Table D.13 summarizes the 2025 single-cycle currency operating budget of $1,040.0 million.18 The 2025 single-cycle operating budget reflects an increase of $6.7 million, or 0.7 percent, from 2024 actual expenses. BEP costs associated with the printing of Federal Reserve notes are 18For 2025, the Board approved a $50,000 single-cycle capital budget to replace aging adversarial laboratory equipment.

158 111th Annual Report | 2024 Table D.13. Federal Reserve single-cycle currency budget, 2024–25 Millions of dollars, except as noted Variance Variance 2024 2024 2024 actual to 2025 2025 budget to Item budget actual 2024 budget budget 2024 actual Amount Percent Amount Percent BEP costs1 1,033.7 976.6 −57.1 −5.5 976.9 0.3 0.0 Printing Federal Reserve notes 1,027.4 972.5 −54.9 −5.3 972.0 −0.5 −0.1 BEP fixed printing costs 665.5 659.5 −6.0 −0.9 688.6 29.0 4.4 BEP variable printing costs 361.9 313.0 −48.9 −13.5 283.4 −29.6 −9.4 BEP support costs 6.3 4.1 −2.2 −35.4 5.0 0.9 20.8 Currency reader 1.1 1.1 −0.1 −4.5 1.2 0.1 7.8 Mutilated currency2 5.2 3.0 −2.2 −42.2 3.8 0.8 25.5 Board costs3 70.2 56.7 −13.5 −19.3 63.1 6.4 11.3 Currency issuance 31.7 20.9 −10.7 −33.9 25.0 4.1 19.6 Banknote development 32.6 29.7 −2.8 −8.6 24.7 −5.1 −17.0 Currency education 6.0 6.0 0.0 0.3 7.1 1.0 16.9 Counterfeit threat analysis4 n/a n/a n/a n/a 6.3 6.3 n/a Operating budget 1,104.0 1,033.3 −70.6 −6.4 1,040.0 6.7 0.7 n/a Not applicable. 1 BEP costs (budget and actual) reflect Board reimbursements to the BEP, which may vary from BEP’s actual expenses. Annually, a true-up process is in place to account for any variance between Board reimbursement and BEP actual expenses. 2 Previously named destruction and compliance. Beginning in 2025, this category will only include costs for mutilated currency. 3 Includes personnel, travel, and training costs applicable to the categories that they support. 4 Counterfeit threat analysis is a new category that was included as part of the 2025 currency budget. 93.9 percent of the operating budget. Board expenses for currency issuance, banknote development, currency education, and counterfeit threat analysis comprise the remaining 6.1 percent of the operating budget. Table D.14 provides an overview of the multicycle project budget that funds the BEP’s capital investments. BEP Single-Cycle Operating Costs The proposed 2025 budget to fund the BEP printing and support costs is $976.9 million, which is $0.3 million, or 0.03 percent, higher than 2024 actual expenses. The budget for fixed printing costs is $688.6 million, which is $29.0 million, or 4.4 percent, higher than 2024 actual expenses. Fixed costs are growing to support cybersecurity efforts and information technology upgrades, and to fund increased staffing levels for manufacturing support.

Federal Reserve System Budgets 159 Table D.14. Multicycle projects in the currency budget, 2024–25 Millions of dollars, except as noted Lifetime 2023 and Item 2024 budget 2024 actual 2025 budget project prior actual budget BEP project funding1 Fort Worth facility expansion2 272.6 10.2 n/a n/a 282.8 Washington, D.C. replacement facility3 120.9 39.2 25.4 117.9 1,784.1 Note production equipment4 190.9 215.3 183.6 105.6 1,265.0 Total 460.6 264.7 209.0 223.5 3,331.9 n/a Not applicable. 1 BEP costs (budget and actual) reflect Board reimbursements to the BEP, which may vary from BEP’s actual expenses. Annually, a true-up process is in place to account for any variance between Board reimbursement and BEP actual expenses. 2 In August of 2021, the Board approved a lifetime project budget of $282.8 million. This project was successfully completed in 2024. 2024 spending on the Fort Worth, Texas, western currency facility was minimal and covered by prior reimbursements. 3 In December of 2022, the Board approved $134.1 million. In October of 2023, the Board approved an additional $1,650.0 million. 4 In August of 2023, under delegated authority, the director of RBOPS approved $746.8 million. In May of 2024, under delegated authority, the director of RBOPS approved an additional $478.0 million. There is $40.2 million remaining in contingency funding that has not been released. The budget for variable printing costs is $283.4 million, which is $29.6 million, or 9.4 percent, lower than 2024 actual expenses. The decrease is primarily a result of fewer expected note deliveries in 2025. BEP Multicycle Project Operating Costs The 2025 budget includes two multicycle projects: the BEP’s Washington, D.C., replacement facility (DCRF) and modernization of BEP note production equipment. The combined lifetime project budget for DCRF and note production equipment is $3,049.1 million. The Fort Worth, Texas, western currency facility expansion project was successfully completed in 2024 and is therefore no longer reflected in the 2025 budget. The Board has reimbursed the BEP $272.6 million for the project. As of May 2024, there is a total of $3,049.1 million in approved multicycle project funding, which includes $1,784.1 million for the new DCRF facility and $1,265.0 million for a generational upgrade of note production equipment for both BEP facilities. Within the lifetime project budget for note production equipment, there is $40.2 million remaining in contingency funding that has not been released and requires additional review and approval by the director of RBOPS when funding

160 111th Annual Report | 2024 is required. The lifetime project budget of Figure D.4. Federal Reserve costs for currency, 2015–25 $1,265.0 for note production equipment funds the replacement of nearly all the pro- Millions of dollars duction equipment at the BEP through 1,500 2033.19 1,200 The multicycle project budget includes 2025 900 components for each of the two budgeted 600 projects: $117.9 million to complete the DCRF 300 design and prepare for the awarding of the construction contract, and $105.6 million for 0 2015 2017 2019 2021 2023 2025 note production equipment to support the BEP and Board’s joint commitment to replacing Note: All years represent the sum of single-cycle aging equipment. operating costs and multicycle projects. For 2025, budgeted. Board Single-Cycle Operating Costs The Board costs budget is $63.1 million, which is $6.4 million, or 11.3 percent, higher than 2024 actual costs. The year-over-year change is primarily driven by increases to support the U.S. currency program’s strategic initiatives. The currency issuance budget increases are primarily attributable to increased transportation costs due to updated contract pricing, increased shipments to rebalance Reserve Bank inventories given the reduced print order, increased shipments to support Reserve Bank cash offices during renovations to support deployment of new currency processing machines, and development of a new currency ordering application. The banknote development decrease is primarily attributable to the successful completion of a counterfeit-detection project and reduced contractual support for overseeing and identifying risks in executing major cross-program initiatives. The decrease is slightly offset by increased Central Bank Counterfeit Deterrence Group membership fees to fund work that was deferred from 2024. The currency education program will focus on efforts to protect and maintain confidence in U.S. currency worldwide through public outreach, expansion of domestic and international stakeholder education, and brand strategy to prepare for the release of the next family of notes. 19BEP staff estimates that the equipment will have a life expectancy of 15 to 20 years and will require mid-lifecycle upgrades 7 to 10 years after it has been placed in service.

Federal Reserve System Budgets 161 The 2025 currency budget includes funding for three new positions and additional contract resources to support counterfeit threat analysis efforts. The three additional positions will support analyzing and curating intelligence analysis in support of the Board’s currency issuance role, which includes banknote issues such as security features and circulation patterns. The additional contract resources will assist with assessing options for counterfeit processing performed by the Reserve Banks and U.S. Secret Service and identifying ways to better respond to counterfeiting threats. The currency issuance, banknote development, currency education, and counterfeit threat analysis budget categories also include personnel, travel, training, and support and overhead costs.20 20The currency budget includes support and overhead costs for enterprise IT, facilities, law enforcement, human resources, and other services.

163 E Record of Policy Actions of the Board of Governors Policy actions of the Board of Governors are presented pursuant to section 10 of the Federal Reserve Act. That section provides that the Board shall keep a record of all questions of policy determined by the Board and shall include in its annual report to Congress a full account of such actions. This appendix provides a summary of policy actions in 2024. Board members’ votes are provided after each summary. Policy actions were implemented through (1) rules and regulations, (2) policy statements and other actions, and (3) discount rates for depository institutions. More information on the actions is available from the relevant Federal Registernotices or other documents (see links in footnotes) or on request from the Board’s Freedom of Information Office. This appendix also provides information on the Board and the Government Performance and Results Act. For information on the Federal Open Market Committee’s (FOMC’s) policy actions relating to open market operations, see Appendix B, “Minutes of Federal Open Market Committee Meetings.” Rules and Regulations Regulation Y (Bank Holding Companies and Change in Bank Control) Effective October 1, 2025. On July 11, 2024, the Board approved a final rule (Docket No. R-1807), issued jointly with the Office of the Comptroller of the Currency (OCC), the Federal Deposit Insurance Corporation (FDIC), the National Credit Union Administration (NCUA), the Consumer Financial Protection Bureau (CFPB), and the Federal Housing Finance Agency, to implement quality control standards, as mandated by the Dodd-Frank Wall Street Reform and Consumer Protection Act, related to automated valuation models (AVMs) used in determining the value of real estate collateral securing mortgage loans.1Under the final rule (“Quality Control Standards for Automated Valuation Models Used for Mortgage Lending Purposes,” subpart O of Regulation Y), Board-regulated institutions that engage in certain credit decisions or securitization determinations must adopt policies, practices, procedures, and control systems to ensure that the AVMs used in these transactions adhere to quality control standards designed to ensure a high level of confidence in the estimates produced; protect against manipulation of data; seek to avoid conflicts of interest; require random sample testing and reviews; and comply with applicable nondiscrimination laws. 1 See Federal Registernotice at https://www.govinfo.gov/content/pkg/FR-2024-08-07/pdf/2024-16197.pdf.

164 111th Annual Report | 2024 Voting for this action:Chair Powell, Vice Chair Jefferson, Vice Chair for Supervision Barr, and Governors Bowman, Waller, Cook, and Kugler. Regulation BB (Community Reinvestment) Effective April 1, 2024.On March 20, 2024, the Board approved a supplemental rule (Docket No. R-1830), issued jointly with the OCC and the FDIC (together with the Board, the agencies), related to the agencies’ Community Reinvestment Act final rule that was issued on October 24, 2023 (the 2023 CRA final rule). The supplemental rule has two components.2First, the agencies adopted an interim final rule that extends the applicability date of two provisions of the 2023 CRA final rule, from April 1, 2024, to January 1, 2026, and requests comment on this extension. Second, the agencies adopted a final rule that makes various technical amendments to the 2023 CRA final rule and related regulations. Voting for this action:Chair Powell, Vice Chair Jefferson, Vice Chair for Supervision Barr, and Governors Bowman, Waller, Cook, and Kugler. Regulation HH (Designated Financial Market Utilities) Effective April 15, 2024.On March 1, 2024, the Board approved a final rule (Docket No. R-1782) to amend the requirements relating to operational risk management for certain financial market utilities (FMUs) that have been designated as systemically important (designated FMUs).3The amendments update, refine, and add specificity to existing requirements, including those for business continuity planning and third-party risk management, to reflect changes in the operational risk, technology, and regulatory landscape in which designated FMUs operate. The final rule also adopts specific incident-notification requirements. Voting for this action:Chair Powell, Vice Chair Jefferson, Vice Chair for Supervision Barr, and Governors Bowman, Waller, Cook, and Kugler. Policy Statements and Other Actions Bank Term Funding Program On January 23, 2024, the Board approved a modification to the interest rate applicable to new Bank Term Funding Program (BTFP) loans such that the BTFP rate would not be lower than the interest on reserve balances rate in effect on the day the loan was made.4The Board also announced that the BTFP would cease making new loans on March 11, 2024, as scheduled. 2 See Federal Registernotice at https://www.govinfo.gov/content/pkg/FR-2024-03-29/pdf/2024-06497.pdf. 3 See Federal Registernotice at https://www.govinfo.gov/content/pkg/FR-2024-03-15/pdf/2024-05322.pdf. 4 See press release at https://www.federalreserve.gov/newsevents/pressreleases/monetary20240124a.htm. See also press releases at https://www.federalreserve.gov/newsevents/pressreleases/monetary20230312a.htm and https://www.federalreserve.gov/newsevents/pressreleases/monetary20230312b.htm.

Record of Policy Actions of the Board of Governors 165 Voting for these actions:Chair Powell, Vice Chair Jefferson, Vice Chair for Supervision Barr, and Governors Bowman, Waller, Cook, and Kugler. Disaster-Related Appraisal Exceptions Effective March 12, 2024.On March 4, 2024, the Board approved a statement and order (Docket No. OP-1829), issued jointly with the OCC, the FDIC, and the NCUA, granting temporary exceptions to certain regulatory appraisal requirements for transactions involving real property located in a designated disaster area of Hawaii, provided the transactions meet certain criteria.5The exceptions were intended to facilitate disaster recovery as a result of the 2023 wildfires in Maui County and will expire three years after the date of the disaster declaration. Voting for this action:Chair Powell, Vice Chair Jefferson, Vice Chair for Supervision Barr, and Governors Bowman, Waller, Cook, and Kugler. Reconsiderations of Value for Residential Real Estate Valuations Effective July 26, 2024.On July 11, 2024, the Board approved final interagency guidance (Docket No. OP-1809) that highlights risks associated with deficient residential real estate valuations and describes how financial institutions may incorporate reconsiderations of value processes and controls into established risk-management functions.6The guidance, issued jointly with the OCC, the FDIC, the NCUA, and the CFPB, also provides examples of policies and procedures that a financial institution may choose to implement to help identify, address, and mitigate the risk of discrimination impacting residential real estate valuations. Voting for this action:Chair Powell, Vice Chair Jefferson, Vice Chair for Supervision Barr, and Governors Bowman, Waller, Cook, and Kugler. Resolution Plan Guidance On August 2, 2024, the Board approved final guidance (Docket Nos. OP-1816 and OP-1817), issued jointly with the FDIC, to assist certain large banking organizations with their 2025 and subsequent resolution plan submissions.7In the guidance, which generally applies to domestic and foreign banking organizations with more than $250 billion in total consolidated assets but that are not the largest and most complex banks, the Board and FDIC provide their expectations for the resolution plans of these banking organizations regarding their capital, liquidity, governance mechanisms, and other key areas of potential vulnerabilities. The content of the guidance depends on a banking organization’s status as a domestic or foreign firm and its chosen resolution plan strategy, whether single point of entry or multiple point of entry. In addition, the Board 5 See Federal Registernotice at https://www.govinfo.gov/content/pkg/FR-2024-03-12/pdf/2024-05159.pdf. 6 See Federal Registernotice at https://www.govinfo.gov/content/pkg/FR-2024-07-26/pdf/2024-16200.pdf. 7 See Federal Registernotices at https://www.govinfo.gov/content/pkg/FR-2024-08-15/pdf/2024-18191.pdf and https://www.govinfo.gov/content/pkg/FR-2024-08-15/pdf/2024-18186.pdf.

166 111th Annual Report | 2024 extended the deadline for these domestic and foreign banking organizations to submit their resolution plans from March 31 to October 1, 2025. Voting for this action:Chair Powell, Vice Chair Jefferson, Vice Chair for Supervision Barr, and Governors Bowman, Waller, Cook, and Kugler. Guidelines for Evaluating Account and Services Requests Effective December 12, 2024.On December 5, 2024, the Board approved a technical clarification (Docket No. OP-1747) that its account access guidelines also apply to excess balance accounts (EBAs).8An EBA is a limited-purpose account at a Federal Reserve Bank established for maintaining the reserve balances of eligible institutions. An EBA is managed by an agent on behalf of the participating institutions. The Board’s account access guidelines, which were implemented in 2022, establish a transparent, risk-based, and consistent set of factors for reviewing requests for accounts and services. Voting for this action:Chair Powell, Vice Chair Jefferson, Vice Chair for Supervision Barr, and Governors Bowman, Waller, Cook, and Kugler. Interest on Reserves On September 18, 2024, the Board approved lowering the interest rate paid on reserve balances from 5.4 percent to 4.9 percent, effective September 19, 2024.9This action was taken to support the FOMC’s decision on September 18, 2024, to lower the target range for the federal funds rate by 50 basis points, to a range of 4¾ to 5 percent. Voting for this action:Chair Powell, Vice Chair Jefferson, Vice Chair for Supervision Barr, and Governors Bowman, Waller, Cook, and Kugler. On November 7, 2024, the Board approved lowering the interest rate paid on reserve balances from 4.9 percent to 4.65 percent, effective November 8, 2024.10This action was taken to support the FOMC’s decision on November 7, 2024, to lower the target range for the federal funds rate by 25 basis points, to a range of 4½ to 4¾ percent. Voting for this action:Chair Powell, Vice Chair Jefferson, Vice Chair for Supervision Barr, and Governors Bowman, Waller, Cook, and Kugler. 8 See Federal Registernotice at https://www.govinfo.gov/content/pkg/FR-2024-12-12/pdf/2024-29250.pdf. 9 See press release at https://www.federalreserve.gov/newsevents/pressreleases/monetary20240918a.htm. 10See press release at https://www.federalreserve.gov/newsevents/pressreleases/monetary20241107a1.htm.

Record of Policy Actions of the Board of Governors 167 On December 18, 2024, the Board approved lowering the interest rate paid on reserve balances from 4.65 percent to 4.4 percent, effective December 19, 2024.11This action was taken to support the FOMC’s decision on December 18, 2024, to lower the target range for the federal funds rate by 25 basis points, to a range of 4¼ to 4½ percent. Voting for this action:Chair Powell, Vice Chair Jefferson, Vice Chair for Supervision Barr, and Governors Bowman, Waller, Cook, and Kugler. Discount Rates for Depository Institutions in 2024 Under the Federal Reserve Act, the boards of directors of the Federal Reserve Banks must establish rates on discount window loans to depository institutions at least every 14 days, subject to review and determination by the Board of Governors. Therefore, about every two weeks the Board considers proposals by the Reserve Banks for the level of the primary credit rate and for the formulas used to compute the secondary and seasonal credit rates.12For the levels of Federal Reserve Bank interest rates on loans to depository institutions at year-end, see table E.1.13 Table E.1. Federal Reserve Bank interest rates on loans to depository institutions, December 31, 2024 Percent Reserve Bank Primary credit Secondary credit Seasonal credit All Reserve Banks 4.50 5.00 4.50 Primary, Secondary, and Seasonal Credit Primary credit, the Federal Reserve’s main lending program for depository institutions, is extended at the primary credit rate. It is made available, with minimal administration, as a source of liquidity to depository institutions that, in the judgment of the lending Federal Reserve Bank, are in generally sound financial condition. During 2024, the Board approved three decreases in the primary credit rate, bringing the rate from 5½ percent to 4½ percent. Following changes to the primary credit program announced by the Board on March 15, 2020, depository institutions may borrow primary credit for periods as long as 90 days, prepayable and renewable by the borrower daily.14 11See press release at https://www.federalreserve.gov/newsevents/pressreleases/monetary20241218a1.htm. 12See the minutes of the Board of Governors discount rate meetings at https://www.federalreserve.gov/monetarypolicy/ discountrate.htm. 13For current and historical discount rates, see https://www.frbdiscountwindow.org. 14See press release at https://www.federalreserve.gov/newsevents/pressreleases/monetary20200315b.htm.

168 111th Annual Report | 2024 Secondary credit is available in appropriate circumstances to depository institutions that do not qualify for primary credit. The secondary credit rate is set at a spread above the primary credit rate. Throughout 2024, the spread was set at 50 basis points. At year-end, the secondary credit rate was 5 percent. Seasonal credit is available to smaller depository institutions to meet liquidity needs that arise from regular swings in their loans and deposits. The rate on seasonal credit is calculated every two weeks as an average of selected money market yields, typically resulting in a rate close to the target range for the federal funds rate. At year-end, the seasonal credit rate was 4.50 percent. Votes on Changes to Discount Rates for Depository Institutions During 2024, there were three decreases in the primary credit rate, and the Board approved proposals by the Reserve Banks to renew the formulas used to compute the secondary and seasonal credit rates. Each FOMC meeting associated with a change in the primary credit rate is listed below with the details of the Board’s actions to approve those changes. Reserve Bank requests to establish the primary credit rate may be submitted on varying dates, up to and including the effective date. FOMC meeting ending on September 18, 2024.At the meeting, the Board approved an action taken by the board of directors of the Federal Reserve Bank of Atlanta to decrease the primary credit rate from 5½ percent to 5 percent, effective September 19, 2024. After the meeting and before the close of business on the effective date, the Board approved identical actions taken by the boards of directors of the Federal Reserve Banks of Boston, New York, Philadelphia, Cleveland, Richmond, Chicago, St. Louis, Minneapolis, Kansas City, Dallas, and San Francisco, effective September 19, 2024. Voting for this action:Chair Powell, Vice Chair Jefferson, Vice Chair for Supervision Barr, and Governors Bowman, Waller, Cook, and Kugler. FOMC meeting ending on November 7, 2024.At the meeting, the Board approved actions taken by the boards of directors of the Federal Reserve Banks of Boston, New York, Philadelphia, Cleveland, Richmond, Atlanta, Chicago, Minneapolis, Dallas, and San Francisco to decrease the primary credit rate from 5 percent to 4¾ percent, effective November 8, 2024. After the meeting and before the close of business on the effective date, the Board approved identical actions taken by the boards of directors of the Federal Reserve Banks of St. Louis and Kansas City, effective November 8, 2024. Voting for this action:Chair Powell, Vice Chair Jefferson, Vice Chair for Supervision Barr, and Governors Bowman, Waller, Cook, and Kugler.

Record of Policy Actions of the Board of Governors 169 FOMC meeting ending on December 18, 2024. At the meeting, the Board approved actions taken by the boards of directors of the Federal Reserve Banks of Boston, New York, Philadelphia, Cleveland, Richmond, Atlanta, Chicago, and San Francisco to decrease the primary credit rate from 4¾ percent to 4½ percent, effective December 19, 2024. After the meeting and before the close of business on the effective date, the Board approved identical actions taken by the boards of directors of the Federal Reserve Banks of St. Louis, Minneapolis, Kansas City, and Dallas, effective December 19, 2024. Voting for this action:Chair Powell, Vice Chair Jefferson, Vice Chair for Supervision Barr, and Governors Bowman, Waller, Cook, and Kugler. The Board of Governors and the Government Performance and Results Act Overview The Government Performance and Results Act (GPRA) of 1993, as amended by the GPRA Modernization Act of 2010, requires federal agencies to prepare a strategic plan covering a multiyear period and to submit an annual performance plan and an annual performance report. Although the Board is not covered by GPRA, the Board voluntarily complies with the spirit of GPRA and, like other federal agencies, publishes a multiyear strategic plan as well as an annual performance plan and an annual performance report. These reports are publicly available among the Board’s publications.15 Four-Year Strategic Plan, Annual Performance Plan, and Annual Performance Report On December 15, 2023, the Board published the Strategic Plan 2024–27, which outlined the organization’s priorities across five functional areas—Monetary Policy and Financial Stability, Supervision and Regulation, Payment System and Reserve Bank Oversight, Consumer Protection and Community Development, and Mission Advancement. In formulating the Strategic Plan 2024–27, the Board identified and prioritized the goals and objectives paramount to advancing the organization’s mission while allowing for appropriate flexibility to respond to emerging and evolving challenges. The Annual Performance Plansets forth the projects and initiatives in support of the Board’s Strategic Plan’s goals and objectives during a one-year period. The Annual Performance Planhelps the organization identify and prioritize investments and dedicate sufficient resources across the five functions to meet its mission-critical work, while maintaining ongoing operations. 15The Strategic Plan, Annual Performance Plan, and Annual Performance Reportare available on the Federal Reserve Board’s website at https://www.federalreserve.gov/publications/gpra.htm.

170 111th Annual Report | 2024 The Annual Performance Reportsummarizes the Board’s accomplishments throughout the performance year toward achieving the projects and initiatives identified in that year’s Annual Performance Plan. The Annual Performance Reportprovides transparency into the organization’s highpriority activities. Ultimately, the organization’s planning and performance reporting processes enable the Board to identify, prioritize, and progress those activities most critical to advancing the organization’s work and communicate this to the public.

171 F Litigation The Board of Governors was a party in 13 lawsuits or appeals filed in 2024 and was a party in 13 other cases pending from previous years, for a total of 26 cases. In 2023, the Board was a party in a total of 16 cases. As of December 31, 2024, 16 cases were pending. Pending Abdullah v. Powell, No. 24-cv-2778 (D. District of Columbia, removed from D.C. Superior Court September 30, 2024), is an employment discrimination case. Banco San Juan Internacional, Inc. v. Board of Governors and Federal Reserve Bank of New York, No. 23-cv-6414 (S.D. New York, filed July 25, 2023), is an Administrative Procedure Act and constitutional law challenge regarding the termination of a Reserve Bank master account. Bank Policy Institute et al. v. Board of Governors, No. 24-cv-4300 (S.D. Ohio, filed December 24, 2024), is an Administrative Procedure Act challenge regarding bank stress testing requirements. Bauersachs v. Board of Governors et al., No. 24-1796 (1st Circuit, filed August 28, 2024), is an appeal of an order dismissing an Administrative Procedure Act and constitutional law challenge regarding monetary policy actions. Bennett v. Board of Governors et al., No. 24-cv-362 (W.D. Missouri, filed May 24, 2024), is an employment case. Board of Governors v. Smith, No. 23-cv-2747 (D. District of Columbia, filed September 19, 2023), is a breach of contract and debt collection action. Bobowicz v. Powell et al., No. 24-cv-246 (W.D. North Carolina, filed November 18, 2024), is an employment discrimination case. Bogolub v. Board of Governors, No. 24-cv-6806 (N.D. California, filed September 27, 2024), is an action under the Freedom of Information Act.

172 111th Annual Report | 2024 Corner Post v. Board of Governors, No. 21-cv-95 (D. North Dakota, filed April 29, 2021), is an Administrative Procedure Act challenge to the debit interchange fee provisions of the Board’s Regulation II. Custodia Bank v. Board of Governors and Federal Reserve Bank of Kansas City, No. 24-8024 (10th Circuit, filed April 26, 2024), is an appeal of an order granting judgment to the Board in an Administrative Procedure Act and constitutional law challenge regarding the issuance of a Reserve Bank master account. Employee Retirement System for the City of Providence v. Board of Governors, No. 24-mc-349 (S.D. New York, filed July 31, 2024), is an Administrative Procedure Act challenge regarding Board confidential supervisory information. Judicial Watch v. Board of Governors et al., No. 23-cv-1174 (D. District of Columbia, filed April 27, 2023), is an action under the Freedom of Information Act. Leopold and Bloomberg L.P. v. Board of Governors, No. 23-cv-2004 (D. District of Columbia, filed July 12, 2023), is an action under the Freedom of Information Act. Linney’s Pizza, LLC v. Board of Governors, No. 22-cv-71 (E.D. Kentucky, filed December 9, 2022), is an Administrative Procedure Act challenge to the debit interchange fee provisions of the Board’s Regulation II. Texas Bankers Association et al. v. Board of Governors et al., No. 24-cv-25 (N.D. Texas, filed February 5, 2024), is an Administrative Procedure Act challenge to agency rules implementing the Community Reinvestment Act. Texas Bankers Association et al. v. Board of Governors et al., No. 24-10367 (5th Circuit, filed April 18, 2024), is an appeal of a preliminary injunction in an Administrative Procedure Act challenge to agency rules implementing the Community Reinvestment Act. Resolved Banco San Juan Internacional, Inc. v. Board of Governors and Federal Reserve Bank of New York, No. 23-7558 (2d Circuit, filed October 30, 2023), was an appeal of an order denying a preliminary injunction in an Administrative Procedure Act and constitutional law challenge regarding the termination of a Reserve Bank master account. On February 12, 2024, the court of appeals granted Banco San Juan Internacional’s motion to withdraw the appeal.

Litigation 173 Bauersachs v. Board of Governors et al., No. 24-cv-10869 (D. Massachusetts, filed April 4, 2024), was an Administrative Procedure Act and constitutional law challenge regarding monetary policy actions. On August 9, 2024, the district court granted the Board’s motion to dismiss. Corner Post v. Board of Governors, No. 22-1008 (U.S. Supreme Court, certiorari granted September 29, 2023), was a review of an order affirming dismissal of an Administrative Procedure Act challenge to the debit interchange fee provisions of the Board’s Regulation II. On July 1, 2024, the Supreme Court reversed the dismissal of the case and remanded for further proceedings. Cunningham v. Board of Governors, No. 22-1311 (D.C. Circuit, filed December 8, 2022), was a petition for review of a Board order approving the acquisition of a bank under the Bank Holding Company Act. On May 7, 2024, the court of appeals dismissed the case. Custodia Bank v. Board of Governors and Federal Reserve Bank of Kansas City, No. 22-cv-125 (D. Wyoming, filed June 7, 2022), was an Administrative Procedure Act and constitutional law challenge regarding the issuance of a Reserve Bank master account. On March 29, 2024, the district court denied the plaintiff’s claims. Informed Consent Action Network v. Board of Governors, No. 24-cv-1031 (D. District of Columbia, filed April 10, 2024), was an action under the Freedom of Information Act. On August 21, 2024, the case was dismissed pursuant to a stipulation of the parties. Judicial Watch v. Board of Governors, No. 22-cv-40 (D. District of Columbia, filed January 18, 2022), was an action under the Freedom of Information Act. On June 24, 2024, the case was dismissed pursuant to a stipulation of the parties. Linney’s Pizza, LLC v. Board of Governors, No. 23-5993 (6th Circuit, filed November 8, 2023), was an appeal of an order dismissing an Administrative Procedure Act challenge to the debit interchange fee provisions of the Board’s Regulation II. On September 5, 2024, the court of appeals granted the parties’ stipulation to remand for further proceedings. Smith v. Board of Governors, No. 24-cv-17189 (E.D. Pennsylvania, removed from Pennsylvania state court April 24, 2024), was an invasion of privacy claim. On August 28, 2024, the court granted the Board’s motion to dismiss. The Revolving Door Project v. Board of Governors, No. 22-cv-3620 (D. District of Columbia, filed December 2, 2022), was an action under the Freedom of Information Act. On October 9, 2024, the case was dismissed pursuant to a stipulation of the parties.

175 G Statistical Tables This appendix includes 13 statistical tables that provide updated historical data concerning Board and System operations and activities. Table G.1. Federal Reserve open market transactions, 2024 Millions of dollars Type of security and Jan. Feb. Mar. Apr. May June July Aug. Sept. Oct. Nov. Dec. Total transaction U.S. Treasury securities1 Outright transactions2 Treasury bills Gross purchases 0 0 0 0 75 75 0 0 0 0 0 50 200 Gross sales 0 0 0 0 0 0 0 0 0 0 0 0 0 Exchanges 41,376 70,514 3,611 42,528 70,592 12,349 39,657 67,643 9,205 62,800 53,958 12,266 486,499 For new bills 41,376 70,514 3,611 42,528 70,592 12,349 39,657 67,643 9,205 62,800 53,958 12,266 486,499 Redemptions 6,616 0 15,210 0 0 0 0 0 0 0 0 0 21,826 Others up to 1 year Gross purchases 75 0 0 0 0 0 0 0 75 0 0 50 200 Gross sales 0 0 0 0 0 0 0 0 0 0 0 0 0 Exchanges 0 −17,342 0 −3,150 −30,138 −3,849 −39,668 −23,772 −21,358 −5,850 −30,378 −16,532 −192,037 Redemptions 53,391 60,000 44,790 59,989 60,000 25,000 24,986 25,000 25,000 24,998 25,000 25,000 453,154 Over 1 to 5 years Gross purchases 0 0 20 0 25 0 0 25 0 0 0 0 70 Gross sales 0 17 0 0 0 0 0 0 0 0 75 0 92 Exchanges 0 9,488 0 1,872 17,205 1,876 23,582 11,030 14,477 4,052 14,095 11,453 109,130 Over 5 to 10 years Gross purchases 0 0 30 50 0 0 0 0 0 0 0 0 80 Gross sales 0 33 0 0 0 0 0 0 0 0 0 0 33 Exchanges 0 4,923 0 853 8,841 1,261 11,342 7,988 5,130 1,277 10,207 3,705 55,527 More than 10 years Gross purchases 0 48 0 0 0 0 50 0 0 75 0 0 173 Gross sales 0 0 0 0 0 25 0 50 0 0 0 0 75 Exchanges 0 2,931 0 425 4,092 712 4,744 4,754 1,751 521 6,076 1,374 27,380 All maturities Gross purchases 75 48 50 50 100 75 50 25 75 75 0 100 723 Gross sales 0 50 0 0 0 25 0 50 0 0 75 0 200 Redemptions 60,007 60,000 60,000 59,989 60,000 25,000 24,986 25,000 25,000 24,998 25,000 25,000 474,980 Net change in U.S. Treasury securities −59,932 −60,002 −59,950 −59,939 −59,900 −24,950 −24,936 −25,025 −24,925 −24,923 −25,075 −24,900 −474,457 (continued)

176 111th Annual Report | 2024 Table G.1—continued Type of security and Jan. Feb. Mar. Apr. May June July Aug. Sept. Oct. Nov. Dec. Total transaction Federal agency obligations Outright transactions2 Gross purchases 0 0 0 0 0 0 0 0 0 0 0 0 0 Gross sales 0 0 0 0 0 0 0 0 0 0 0 0 0 Redemptions 0 0 0 0 0 0 0 0 0 0 0 0 0 Net change in federal agency obligations 0 0 0 0 0 0 0 0 0 0 0 0 0 Mortgage-backed securities3 Net settlements2 Net change in mortgagebacked securities −14,616 −13,921 −14,800 −16,387 −17,406 −18,646 −17,806 −18,393 −17,720 −16,115 −16,981 −15,719 −198,510 Total net change in securities holdings4 −74,548 −73,923 −74,750 −76,326 −77,306 −43,596 −42,742 −43,418 −42,645 −41,038 −42,056 −40,619 −672,967 Temporary transactions Repurchase agreements5 1 5 5 6 7 11 30 5 99 6 7 7 n/a Reverse repurchase agreements5 994,956 874,834 820,961 793,615 825,224 819,999 797,837 733,200 763,535 686,962 567,422 560,335 n/a Foreign official and international accounts 353,099 337,147 344,040 359,502 367,982 383,328 396,940 399,781 421,492 399,508 386,995 391,191 n/a Others 641,857 537,687 476,921 434,113 457,242 436,671 400,897 333,419 342,043 287,454 180,427 169,144 n/a Note: Purchases of Treasury securities and federal agency obligations increase securities holdings; sales and redemptions of these securities decrease securities holdings. Exchanges occur when the Federal Reserve rolls the proceeds of maturing securities into newly issued securities, and so exchanges do not affect total securities holdings. Positive net settlements of mortgage-backed securities increase securities holdings, while negative net settlements of these securities decrease securities holdings. Components may not sum to totals because of rounding. See table 2 of the H.4.1 release (https:// www.federalreserve.gov/releases/h41/) for the maturity distribution of the securities. 1 Transactions exclude changes in compensation for the effects of inflation on the principal of inflation-indexed securities. Transactions include the rollover of inflation compensation into new securities. The maturity distributions of exchanged Treasury securities are based on the announced maturity of new securities rather than actual day counts. 2 Excludes the effect of temporary transactions—repurchase agreements and reverse repurchase agreements. 3 Guaranteed by Fannie Mae, Freddie Mac, and Ginnie Mae. Monthly net change in the remaining principal balance of the securities, reported at face value. 4 The net change in securities holdings reflects the settlements of purchases, reinvestments, sales, and maturities of portfolio securities. 5 Averages of daily cash value of agreements, which are collateralized by U.S. Treasury securities, federal agency debt securities, and mortgage-backed securities. For additional details on temporary transactions, see the temporary open market operations historical search available at https://www.newyorkfed.org/markets/data-hub. n/a Not applicable.

Statistical Tables 177 Table G.2. Federal Reserve Bank holdings of U.S. Treasury and federal agency securities, December 31, 2022–24 Millions of dollars December 31 Change Description 2024 2023 2022 2023–24 2022–23 U.S. Treasury securities1 Held outright2 4,291,106 4,785,138 5,499,354 –494,032 –714,216 By remaining maturity Bills 1–90 days 116,436 131,254 177,692 –14,818 –46,438 91 days to 1 year 78,907 85,715 111,833 –6,808 –26,118 Notes and bonds 1 year or less 544,845 676,304 892,496 –131,459 –216,192 More than 1 year through 5 years 1,465,857 1,614,977 1,915,468 –149,120 –300,491 More than 5 years through 10 years 548,993 771,726 937,231 –222,733 –165,505 More than 10 years 1,536,068 1,505,162 1,464,634 30,906 40,528 By type Bills 195,343 216,969 289,525 –21,626 –72,556 Notes 2,364,266 2,863,795 3,521,904 –499,529 –658,109 Bonds 1,731,497 1,704,374 1,687,925 27,123 16,449 Federal agency securities1 Held outright2 2,347 2,347 2,347 0 0 By remaining maturity Discount notes 1–90 days 0 0 0 0 0 91 days to 1 year 0 0 0 0 0 Coupons 1 year or less 0 0 0 0 0 More than 1 year through 5 years 486 0 0 486 0 More than 5 years through 10 years 1,861 2,347 2,347 –486 0 More than 10 years 0 0 0 0 0 By type Discount notes 0 0 0 0 0 Coupons 2,347 2,347 2,347 0 0 (continued)

178 111th Annual Report | 2024 Table G.2—continued December 31 Change Description 2024 2023 2022 2023–24 2022–23 By issuer Federal Home Loan Mortgage Corporation 529 529 529 0 0 Federal National Mortgage Association 1,818 1,818 1,818 0 0 Federal Home Loan Banks 0 0 0 0 0 Mortgage-backed securities3,4 Held outright2 2,233,263 2,431,773 2,641,403 –198,510 –209,630 By remaining maturity 1 year or less 33 23 38 10 –15 More than 1 year through 5 years 3,811 4,895 4,020 –1,084 875 More than 5 years through 10 years 25,003 32,350 49,979 –7,347 –17,629 More than 10 years 2,204,416 2,394,505 2,587,366 –190,089 –192,861 By issuer Federal Home Loan Mortgage Corporation 854,837 927,035 1,001,274 –72,198 –74,239 Federal National Mortgage Association 921,151 1,004,336 1,091,106 –83,185 –86,770 Government National Mortgage Association 457,275 500,402 549,023 –43,127 –48,621 Temporary transactions5 Repurchase agreements6 0 0 0 0 0 Repo operations 0 0 0 0 0 FIMA Repo Facility 0 0 0 0 0 Reverse repurchase agreements6 888,395 1,390,671 2,889,555 –502,276 –1,498,884 Foreign official and international accounts 414,935 372,188 335,839 42,747 36,349 Primary dealers and expanded counterparties 473,460 1,018,483 2,553,716 –545,023 –1,535,233 Note: Components may not sum to totals because of rounding. 1 Par value. 2 Excludes the effect of temporary transactions—repurchase agreements and reverse repurchase agreements. 3 Guaranteed by Fannie Mae, Freddie Mac, and Ginnie Mae. 4 The par amount shown is the remaining principal balance of the securities. 5 Contract amount of agreements. 6 Cash value of agreements, which are collateralized by U.S. Treasury securities, federal agency debt securities, and mortgage-backed securities.

Statistical Tables 179 Table G.3. Reserve requirements of depository institutions, December 31, 2024 Requirement Liability type1 Percentage Effective of liabilities date Net transaction accounts 0 3/26/2020 Nonpersonal time deposits 0 12/27/1990 Eurocurrency liabilities 0 12/27/1990 Note: The table reflects the liability types and percentages of those liabilities subject to requirements for the maintenance period that contains the year end. 1 For a description of these deposit types, see Regulation D.

180 111th Annual Report | 2024 Table G.4. Banking offices and banks affiliated with bank holding companies in the United States, December 31, 2023 and 2024 Commercial banks1 Savings Type of office Total Member Nonmember bank Total Total Nat'l State Banks Number, Dec. 31, 2023 4,228 4,018 1,375 696 679 2,643 210 Changes during 2024 0 0 0 0 0 0 0 New banks 6 5 0 0 0 5 1 Banks converted into branches –69 –69 –20 –11 –9 –49 0 Ceased banking operations2 –22 –22 –4 –2 –2 –18 0 Other3 0 2 15 2 13 –13 –2 Net change –85 –84 –9 –11 2 –75 –1 Number, Dec. 31, 2024 4,143 3,934 1,366 685 681 2,568 209 Branches and additional offices Number, Dec. 31, 2023 70,703 68,699 47,141 35,122 12,019 21,558 2,004 Changes during 2024 0 0 0 0 0 0 0 New branches 848 830 562 435 127 268 18 Banks converted to branches 69 69 26 9 17 43 0 Discontinued2 –1,661 –1,635 –1,252 –1,029 –223 –383 –26 Other3 0 –18 957 58 899 –975 18 Net change –744 –754 293 –527 820 –1,047 10 Number, Dec. 31, 2024 69,959 67,945 47,434 34,595 12,839 20,511 2,014 Banks affiliated with BHCs Number, Dec. 31, 2023 3,653 3,548 1,262 626 636 2,286 105 Changes during 2024 0 0 0 0 0 0 0 BHC-affiliated new banks 19 16 5 3 2 11 3 Banks converted into branches –58 –58 –17 –10 –7 –41 0 Ceased banking operations2 –22 –22 –4 –2 –2 –18 0 Other3 0 2 13 2 11 –11 –2 Net change –61 –62 –3 –7 4 –59 1 Number, Dec. 31, 2024 3,592 3,486 1,259 619 640 2,227 106 Note: Includes banks, banking offices, and bank holding companies in U.S. territories and possessions (affiliated insular areas). 1 For purposes of this table, banks are entities that are defined as banks in the Bank Holding Company Act, as amended, which is implemented by Federal Reserve Regulation Y. Generally, a bank is any institution that accepts demand deposits and is engaged in the business of making commercial loans or any institution that is defined as an insured bank in section 3(h) of the Federal Deposit Insurance Corporation Act. 2 Institutions that no longer meet the Regulation Y definition of a bank. 3 Interclass changes and sales of branches.

Statistical Tables 181 Table G.5A. Reserves of depository institutions, Federal Reserve Bank credit, and related items, year-end 1984–2024 and month-end 2024 Millions of dollars Factors supplying reserve funds Federal Reserve Bank credit outstanding Special Treasury Period Securities held Repurchase o L t o h a e n r s c r a e n d d it Float Oth R e e r s F e e r d ve eral Total4 Gold stock dr c a e w r i t n ifi g c r a ig te hts c c o u i r n re a n n c d y outright1 agreements2 extensions3 assets4 account outstanding5 1984 167,612 2,015 3,577 833 12,347 186,384 11,096 4,618 16,418 1985 186,025 5,223 3,060 988 15,302 210,598 11,090 4,718 17,075 1986 205,454 16,005 1,565 1,261 17,475 241,760 11,084 5,018 17,567 1987 226,459 4,961 3,815 811 15,837 251,883 11,078 5,018 18,177 1988 240,628 6,861 2,170 1,286 18,803 269,748 11,060 5,018 18,799 1989 233,300 2,117 481 1,093 39,631 276,622 11,059 8,518 19,628 1990 241,431 18,354 190 2,222 39,897 302,091 11,058 10,018 20,402 1991 272,531 15,898 218 731 34,567 323,945 11,059 10,018 21,014 1992 300,423 8,094 675 3,253 30,020 342,464 11,056 8,018 21,447 1993 336,654 13,212 94 909 33,035 383,904 11,053 8,018 22,095 1994 368,156 10,590 223 −716 33,634 411,887 11,051 8,018 22,994 1995 380,831 13,862 135 107 33,303 428,239 11,050 10,168 24,003 1996 393,132 21,583 85 4,296 32,896 451,992 11,048 9,718 24,966 1997 431,420 23,840 2,035 719 31,452 489,466 11,047 9,200 25,543 1998 452,478 30,376 17 1,636 36,966 521,475 11,046 9,200 26,270 1999 478,144 140,640 233 −237 35,321 654,100 11,048 6,200 28,013 2000 511,833 43,375 110 901 36,467 592,686 11,046 2,200 31,643 2001 551,685 50,250 34 −23 37,658 639,604 11,045 2,200 33,017 2002 629,416 39,500 40 418 39,083 708,457 11,043 2,200 34,597 2003 666,665 43,750 62 −319 40,847 751,005 11,043 2,200 35,468 2004 717,819 33,000 43 925 42,219 794,007 11,045 2,200 36,434 2005 744,215 46,750 72 885 39,611 831,532 11,043 2,200 36,540 2006 778,915 40,750 67 −333 39,895 859,294 11,041 2,200 38,206 2007 740,611 46,500 72,636 −19 41,799 901,528 11,041 2,200 38,681 2008 495,629 80,000 1,605,848 −1,494 43,553 2,223,537 11,041 2,200 38,674 2009 1,844,838 0 281,095 −2,097 92,811 2,216,647 11,041 5,200 42,691 2010 2,161,094 0 138,311 −1,421 110,255 2,408,240 11,041 5,200 43,542 2011 2,605,124 0 144,098 −631 152,568 2,901,159 11,041 5,200 44,198 2012 2,669,589 0 11,867 −486 218,296 2,899,266 11,041 5,200 44,751 2013 3,756,158 0 2,177 −962 246,947 4,004,320 11,041 5,200 45,493 2014 4,236,873 0 3,351 −555 239,238 4,478,908 11,041 5,200 46,301 2015 4,241,958 0 2,830 −36 221,448 4,466,199 11,041 5,200 47,567 2016 4,221,187 0 7,325 −804 206,551 4,434,259 11,041 5,200 48,536 2017 4,223,528 0 13,914 −920 194,288 4,430,809 11,041 5,200 49,381 2018 3,862,079 0 4,269 −770 173,324 4,038,902 11,041 5,200 49,801 2019 3,739,957 255,619 3,770 −643 156,304 4,155,007 11,041 5,200 50,138 (continued)

182 111th Annual Report | 2024 Table G.5A—continued Factors supplying reserve funds Federal Reserve Bank credit outstanding Special Treasury Period Securities held Repurchase o L t o h a e n r s c r a e n d d it Float Oth R e e r s F e e r d ve eral Total4 Gold stock dr c a e w r i t n ifi g c r a ig te hts c c o u i r n re a n n c d y outright1 agreements2 extensions3 assets4 account outstanding5 2020 6,730,743 1,000 216,669 −567 393,420 7,341,265 11,041 5,200 50,535 2021 8,270,436 0 77,621 −582 389,982 8,737,457 11,041 5,200 50,942 2022 8,143,103 0 47,288 −539 343,400 8,533,252 11,041 5,200 51,471 2023 7,219,258 0 153,881 −556 311,982 7,684,565 11,041 5,200 52,616 2024 6,526,715 0 19,009 –1,089 278,964 6,823,599 11,041 15,200 53,103 2024, month-end Jan. 7,112,224 0 187,050 –1,008 313,062 7,611,328 11,041 5,200 52,672 Feb. 7,037,833 1 183,648 –769 297,095 7,517,808 11,041 5,200 52,742 Mar. 7,005,123 3 155,567 –636 302,501 7,462,558 11,041 5,200 52,798 Apr. 6,892,206 2 149,140 –615 303,747 7,344,480 11,041 5,200 52,854 May 6,817,921 0 129,203 –382 289,069 7,235,811 11,041 5,200 52,924 June 6,792,122 3 128,274 –640 295,392 7,215,151 11,041 10,200 52,980 July 6,734,152 5 122,788 –1,029 298,719 7,154,635 11,041 10,200 53,036 Aug. 6,700,881 0 114,275 –429 286,505 7,101,232 11,041 10,200 53,031 Sept. 6,648,782 2,600 91,679 –678 288,754 7,031,137 11,041 10,200 53,087 Oct. 6,608,126 0 71,987 –885 291,098 6,970,326 11,041 10,200 53,157 Nov. 6,574,511 1 31,714 –558 276,842 6,882,510 11,041 10,200 53,047 Dec. 6,526,715 0 19,009 –1,089 278,964 6,823,599 11,041 15,200 53,103 Note: Components may not sum to totals because of rounding. 1 Includes U.S. Treasury securities, federal agency debt securities, and mortgage-backed securities (MBSs). U.S. Treasury securities and federal agency debt securities include securities lent to dealers, which are fully collateralized by U.S. Treasury securities, federal agency securities, and other highly rated debt securities. 2 Cash value of agreements, which are collateralized by U.S. Treasury securities, federal agency debt securities, and MBS. 3 Includes central bank liquidity swaps; primary, seasonal, secondary credit; and other credit extensions. From 2020 to 2024, included the following liquidity program and 13(3) facility: Paycheck Protection Program Liquidity Facility and MS Facilities 2020 LLC. From 2023 to 2024, also included the Bank Term Funding Program. From 2020 to 2023, also included the Municipal Facility LLC and Term Asset-Backed Securities Loan Facility II LLC. From 2020 to 2021, also included Money Market Mutual Fund Liquidity Facility; Primary Dealer Credit Facility; Commercial Paper Funding Facility II LLC; and Corporate Credit Facilities LLC. From 2015 to 2019, included Maiden Lane LLC. For disaggregated loans and other credit extensions from 1984 to 2014, refer to “Table 5B. Loans and other credit extensions, by type, year-end 1984–2014 and month-end 2014” of the 2014 Annual Report. 4 As of 2013, unamortized discounts on securities held outright are included as a component of “Other Federal Reserve assets.” Previously, they were included in “Other Federal Reserve liabilities and capital.” 5 Includes currency and coin (other than gold) issued directly by the U.S. Treasury. The largest components are fractional and dollar coins. For details, refer to “U.S. Currency and Coin Outstanding and in Circulation,” Treasury Bulletin.

Statistical Tables 183 Table G.5A. Reserves of depository institutions, Federal Reserve Bank credit, and related items, year-end 1984–2024 and month-end 2024—continued Millions of dollars Factors absorbing reserve funds Deposits with Federal Reserve Banks, Reserve other than reserve balances Other balances Period C c u ir r c r u e l n a c t y io i n n re R p m a e u g e v r r n e c e t h r e s s a - 6 e se h T o re c ld a a i s s n u h g r s y 7 de T p e o rm sits Tre G a e s n u - ry su T p re p t a a le s r m y ur e y n- Foreign Other8 b R c a e l l e q a a n u r c i i r n e e g s d 9 li R F a e e b a d s i n e l e i d r t r i v a e e l s R F B e e w a d s i n e e th k r r v a s e l eral Account financing capital4,10 account 1984 183,796 0 513 n/a 5,316 n/a 253 867 1,126 5,952 20,693 1985 197,488 0 550 n/a 9,351 n/a 480 1,041 1,490 5,940 27,141 1986 211,995 0 447 n/a 7,588 n/a 287 917 1,812 6,088 46,295 1987 230,205 0 454 n/a 5,313 n/a 244 1,027 1,687 7,129 40,097 1988 247,649 0 395 n/a 8,656 n/a 347 548 1,605 7,683 37,742 1989 260,456 0 450 n/a 6,217 n/a 589 1,298 1,618 8,486 36,713 1990 286,963 0 561 n/a 8,960 n/a 369 528 1,960 8,147 36,081 1991 307,756 0 636 n/a 17,697 n/a 968 1,869 3,946 8,113 25,051 1992 334,701 0 508 n/a 7,492 n/a 206 653 5,897 7,984 25,544 1993 365,271 0 377 n/a 14,809 n/a 386 636 6,332 9,292 27,967 1994 403,843 0 335 n/a 7,161 n/a 250 1,143 4,196 11,959 25,061 1995 424,244 0 270 n/a 5,979 n/a 386 2,113 5,167 12,342 22,960 1996 450,648 0 249 n/a 7,742 n/a 167 1,178 6,601 13,829 17,310 1997 482,327 0 225 n/a 5,444 n/a 457 1,171 6,684 15,500 23,447 1998 517,484 0 85 n/a 6,086 n/a 167 1,869 6,780 16,354 19,164 1999 628,359 0 109 n/a 28,402 n/a 71 1,644 7,481 17,256 16,039 2000 593,694 0 450 n/a 5,149 n/a 216 2,478 6,332 17,962 11,295 2001 643,301 0 425 n/a 6,645 n/a 61 1,356 8,525 17,083 8,469 2002 687,518 21,091 367 n/a 4,420 n/a 136 1,266 10,534 18,977 11,988 2003 724,187 25,652 321 n/a 5,723 n/a 162 995 11,829 19,793 11,054 2004 754,877 30,783 270 n/a 5,912 n/a 80 1,285 9,963 26,378 14,137 2005 794,014 30,505 202 n/a 4,573 n/a 83 2,144 8,651 30,466 10,678 2006 820,176 29,615 252 n/a 4,708 n/a 98 972 6,842 36,231 11,847 2007 828,938 43,985 259 n/a 16,120 n/a 96 1,830 6,614 41,622 13,986 2008 889,898 88,352 259 n/a 106,123 259,325 1,365 21,221 4,387 48,921 855,599 2009 928,249 77,732 239 n/a 186,632 5,001 2,411 35,262 3,020 63,219 973,814 2010 982,750 59,703 177 0 140,773 199,964 3,337 13,631 2,374 99,602 965,712 2011 1,075,820 99,900 128 0 85,737 n/a 125 64,909 2,480 72,766 1,559,731 2012 1,169,159 107,188 150 0 92,720 n/a 6,427 27,476 n/a 66,093 1,491,044 2013 1,241,228 315,924 234 0 162,399 n/a 7,970 26,181 n/a 63,049 2,249,070 2014 1,342,957 509,837 201 0 223,452 n/a 5,242 20,320 n/a 61,447 2,377,995 2015 1,424,967 712,401 266 0 333,447 n/a 5,231 31,212 n/a 45,320 1,977,163 2016 1,509,440 725,210 166 0 399,190 n/a 5,165 53,248 n/a 46,943 1,759,675 2017 1,618,006 563,958 214 0 228,933 n/a 5,257 77,762 n/a 47,876 1,954,426 (continued)

184 111th Annual Report | 2024 Table G.5A—continued Factors absorbing reserve funds Deposits with Federal Reserve Banks, Reserve other than reserve balances Other balances Period C c u ir r c r u e l n a c t y io i n n re R p m a e u g e v r r n e c e t h r e s s a - 6 e se h T o re c ld a a i s s n u h g r s y 7 de T p e o rm sits Tre G a e s n u - ry su T p re p t a a le s r m y ur e y n- Foreign Other8 b R c a e l l e q a a n u r c i i r n e e g s d 9 li R F a e e b a d s i n e l e i d r t r i v a e e l s R F B e e w a d s i n e e th k r r v a s e l eral Account financing capital4,10 account 2018 1,719,302 304,012 214 0 402,138 n/a 5,245 73,073 n/a 45,007 1,555,954 2019 1,807,740 336,649 171 0 403,853 n/a 5,182 74,075 n/a 44,867 1,548,849 2020 2,089,224 216,051 28 0 1,728,569 n/a 21,838 194,327 n/a 163,075 2,994,932 2021 2,236,789 2,183,041 65 0 406,108 n/a 9,331 255,263 n/a 69,766 3,644,277 2022 2,309,128 2,889,555 99 0 446,685 n/a 8,935 218,227 n/a 43,522 2,684,814 2023 2,347,852 1,390,671 396 0 768,590 n/a 9,692 177,530 n/a −76,067 3,134,759 2024 2,373,845 888,395 316 0 721,892 n/a 9,687 178,912 n/a –162,469 2,892,363 2024, month-end Jan. 2,326,951 977,603 413 0 865,481 n/a 9,688 175,387 n/a –86,998 3,411,717 Feb. 2,333,473 833,149 477 0 837,099 n/a 9,692 160,260 n/a –94,932 3,507,571 Mar. 2,343,890 976,765 444 0 775,268 n/a 13,908 174,831 n/a –99,208 3,345,698 Apr. 2,346,160 932,236 451 0 962,428 n/a 9,695 162,595 n/a –105,210 3,105,216 May 2,352,875 821,101 421 0 718,926 n/a 9,687 158,310 n/a –118,799 3,362,455 June 2,352,915 1,053,066 409 0 777,798 n/a 9,686 166,476 n/a –124,784 3,053,806 July 2,348,663 813,261 404 0 854,001 n/a 9,685 154,673 n/a –130,475 3,178,700 Aug. 2,353,994 849,463 358 0 709,513 n/a 9,683 157,520 n/a –136,440 3,231,413 Sept. 2,351,207 900,044 315 0 885,725 n/a 9,682 176,163 n/a –142,193 2,924,521 Oct. 2,356,723 600,537 347 0 921,042 n/a 9,685 163,433 n/a –153,792 3,146,749 Nov. 2,363,630 602,204 352 0 756,878 n/a 9,688 155,689 n/a –158,106 3,226,462 Dec. 2,373,845 888,395 316 0 721,892 n/a 9,687 178,912 n/a –162,469 2,892,363 6 Cash value of agreements, which are collateralized by U.S. Treasury securities, federal agency debt securities, and GSE MBSs. 7 Coin and paper currency held by the Treasury. 8 As of 2014, includes deposits of designated financial market utilities. 9 Required clearing balances were discontinued in July 2012. 10From 2020 to 2024, includes equity investments for outstanding LLCs. Negative amounts include the cumulative deferred asset position, which is incurred during a period when earnings are not sufficient to provide for the cost of operations, payment of dividends, and maintenance of surplus. The deferred asset is the amount of net earnings that the Federal Reserve Banks need to realize before remittances to the U.S. Treasury resume. In 2010, included funds from American International Group, Inc. asset dispositions, held as agent. n/a Not applicable.

Statistical Tables 185 Table G.5B. Reserves of depository institutions, Federal Reserve Bank credit, and related items, year-end 1918–83 Millions of dollars Factors supplying reserve funds Federal Reserve Bank credit outstanding Special Treasury Other drawing Period Securities Gold coin and Repurchase All Federal rights held Loans Float3 Total stock6 currency agreements2 other4 Reserve certificate outright1 outstanding7 assets5 account 1918 239 0 1,766 199 294 0 2,498 2,873 n/a 1,795 1919 300 0 2,215 201 575 0 3,292 2,707 n/a 1,707 1920 287 0 2,687 119 262 0 3,355 2,639 n/a 1,709 1921 234 0 1,144 40 146 0 1,563 3,373 n/a 1,842 1922 436 0 618 78 273 0 1,405 3,642 n/a 1,958 1923 80 54 723 27 355 0 1,238 3,957 n/a 2,009 1924 536 4 320 52 390 0 1,302 4,212 n/a 2,025 1925 367 8 643 63 378 0 1,459 4,112 n/a 1,977 1926 312 3 637 45 384 0 1,381 4,205 n/a 1,991 1927 560 57 582 63 393 0 1,655 4,092 n/a 2,006 1928 197 31 1,056 24 500 0 1,809 3,854 n/a 2,012 1929 488 23 632 34 405 0 1,583 3,997 n/a 2,022 1930 686 43 251 21 372 0 1,373 4,306 n/a 2,027 1931 775 42 638 20 378 0 1,853 4,173 n/a 2,035 1932 1,851 4 235 14 41 0 2,145 4,226 n/a 2,204 1933 2,435 2 98 15 137 0 2,688 4,036 n/a 2,303 1934 2,430 0 7 5 21 0 2,463 8,238 n/a 2,511 1935 2,430 1 5 12 38 0 2,486 10,125 n/a 2,476 1936 2,430 0 3 39 28 0 2,500 11,258 n/a 2,532 1937 2,564 0 10 19 19 0 2,612 12,760 n/a 2,637 1938 2,564 0 4 17 16 0 2,601 14,512 n/a 2,798 1939 2,484 0 7 91 11 0 2,593 17,644 n/a 2,963 1940 2,184 0 3 80 8 0 2,274 21,995 n/a 3,087 1941 2,254 0 3 94 10 0 2,361 22,737 n/a 3,247 1942 6,189 0 6 471 14 0 6,679 22,726 n/a 3,648 1943 11,543 0 5 681 10 0 12,239 21,938 n/a 4,094 1944 18,846 0 80 815 4 0 19,745 20,619 n/a 4,131 1945 24,262 0 249 578 2 0 25,091 20,065 n/a 4,339 1946 23,350 0 163 580 1 0 24,093 20,529 n/a 4,562 1947 22,559 0 85 535 1 0 23,181 22,754 n/a 4,562 1948 23,333 0 223 541 1 0 24,097 24,244 n/a 4,589 1949 18,885 0 78 534 2 0 19,499 24,427 n/a 4,598 1950 20,725 53 67 1,368 3 0 22,216 22,706 n/a 4,636 1951 23,605 196 19 1,184 5 0 25,009 22,695 n/a 4,709 1952 24,034 663 156 967 4 0 25,825 23,187 n/a 4,812 1953 25,318 598 28 935 2 0 26,880 22,030 n/a 4,894 1954 24,888 44 143 808 1 0 25,885 21,713 n/a 4,985 1955 24,391 394 108 1,585 29 0 26,507 21,690 n/a 5,008 1956 24,610 305 50 1,665 70 0 26,699 21,949 n/a 5,066 1957 23,719 519 55 1,424 66 0 25,784 22,781 n/a 5,146 1958 26,252 95 64 1,296 49 0 27,755 20,534 n/a 5,234 1959 26,607 41 458 1,590 75 0 28,771 19,456 n/a 5,311 1960 26,984 400 33 1,847 74 0 29,338 17,767 n/a 5,398 1961 28,722 159 130 2,300 51 0 31,362 16,889 n/a 5,585 1962 30,478 342 38 2,903 110 0 33,871 15,978 n/a 5,567 (continued)

186 111th Annual Report | 2024 Table G.5B—continued Factors supplying reserve funds Federal Reserve Bank credit outstanding Special Treasury Other drawing Period Securities Gold coin and Repurchase All Federal rights held Loans Float3 Total stock6 currency agreements2 other4 Reserve certificate outright1 outstanding7 assets5 account 1963 33,582 11 63 2,600 162 0 36,418 15,513 n/a 5,578 1964 36,506 538 186 2,606 94 0 39,930 15,388 n/a 5,405 1965 40,478 290 137 2,248 187 0 43,340 13,733 n/a 5,575 1966 43,655 661 173 2,495 193 0 47,177 13,159 n/a 6,317 1967 48,980 170 141 2,576 164 0 52,031 11,982 n/a 6,784 1968 52,937 0 186 3,443 58 0 56,624 10,367 n/a 6,795 1969 57,154 0 183 3,440 64 2,743 63,584 10,367 n/a 6,852 1970 62,142 0 335 4,261 57 1,123 67,918 10,732 400 7,147 1971 69,481 1,323 39 4,343 261 1,068 76,515 10,132 400 7,710 1972 71,119 111 1,981 3,974 106 1,260 78,551 10,410 400 8,313 1973 80,395 100 1,258 3,099 68 1,152 86,072 11,567 400 8,716 1974 84,760 954 299 2,001 999 3,195 92,208 11,652 400 9,253 1975 92,789 1,335 211 3,688 1,126 3,312 102,461 11,599 500 10,218 1976 100,062 4,031 25 2,601 991 3,182 110,892 11,598 1,200 10,810 1977 108,922 2,352 265 3,810 954 2,442 118,745 11,718 1,250 11,331 1978 117,374 1,217 1,174 6,432 587 4,543 131,327 11,671 1,300 11,831 1979 124,507 1,660 1,454 6,767 704 5,613 140,705 11,172 1,800 13,083 1980 128,038 2,554 1,809 4,467 776 8,739 146,383 11,160 2,518 13,427 1981 136,863 3,485 1,601 1,762 195 9,230 153,136 11,151 3,318 13,687 1982 144,544 4,293 717 2,735 1,480 9,890 163,659 11,148 4,618 13,786 1983 159,203 1,592 918 1,605 418 8,728 172,464 11,121 4,618 15,732 Note: For a description of figures and discussion of their significance, see Banking and Monetary Statistics, 1941–1970 (Board of Governors of the Federal Reserve System, 1976), pp. 507–23. Components may not sum to totals because of rounding. 1 In 1969 and thereafter, includes securities loaned—fully guaranteed by U.S. government securities pledged with Federal Reserve Banks—and excludes securities sold and scheduled to be bought back under matched sale–purchase transactions. On September 29, 1971, and thereafter, includes federal agency issues bought outright. 2 On December 1, 1966, and thereafter, includes federal agency obligations held under repurchase agreements. 3 In 1960 and thereafter, figures reflect a minor change in concept; refer to Federal Reserve Bulletin, vol. 47 (February 1961), p. 164. 4 Principally acceptances and, until August 21, 1959, industrial loans, the authority for which expired on that date. 5 For the period before April 16, 1969, includes the total of Federal Reserve capital paid in, surplus, other capital accounts, and other liabilities and accrued dividends, less the sum of bank premises and other assets, and is reported as “Other Federal Reserve accounts”; thereafter, “Other Federal Reserve assets” and “Other Federal Reserve liabilities and capital” are shown separately. 6 Before January 30, 1934, includes gold held in Federal Reserve Banks and in circulation. 7 Includes currency and coin (other than gold) issued directly by the Treasury. The largest components are fractional and dollar coins. For details refer to ‘‘U.S. Currency and Coin Outstanding and in Circulation,’’ Treasury Bulletin. n/a Not applicable.

Statistical Tables 187 Table G.5B. Reserves of depository institutions, Federal Reserve Bank credit, and related items, year-end 1918–83—continued Millions of dollars Factors absorbing reserve funds Deposits with Federal Other Member bank reserves9 Reserve Banks, other than Other Federal Currency Treasury reserve balances Required Period Federal Reserve in cash clearing With Reserve liabilities Currency circulation holdings8 balances Federal Treasury Foreign Other accounts5 and and Required11 Excess11,12 Reserve capital5 coin10 Banks 1918 4,951 288 51 96 25 118 0 0 1,636 n/a 1,585 51 1919 5,091 385 31 73 28 208 0 0 1,890 n/a 1,822 68 1920 5,325 218 57 5 18 298 0 0 1,781 n/a n/a n/a 1921 4,403 214 96 12 15 285 0 0 1,753 n/a 1,654 99 1922 4,530 225 11 3 26 276 0 0 1,934 n/a n/a n/a 1923 4,757 213 38 4 19 275 0 0 1,898 n/a 1,884 14 1924 4,760 211 51 19 20 258 0 0 2,220 n/a 2,161 59 1925 4,817 203 16 8 21 272 0 0 2,212 n/a 2,256 −44 1926 4,808 201 17 46 19 293 0 0 2,194 n/a 2,250 −56 1927 4,716 208 18 5 21 301 0 0 2,487 n/a 2,424 63 1928 4,686 202 23 6 21 348 0 0 2,389 n/a 2,430 −41 1929 4,578 216 29 6 24 393 0 0 2,355 n/a 2,428 −73 1930 4,603 211 19 6 22 375 0 0 2,471 n/a 2,375 96 1931 5,360 222 54 79 31 354 0 0 1,961 n/a 1,994 −33 1932 5,388 272 8 19 24 355 0 0 2,509 n/a 1,933 576 1933 5,519 284 3 4 128 360 0 0 2,729 n/a 1,870 859 1934 5,536 3,029 121 20 169 241 0 0 4,096 n/a 2,282 1,814 1935 5,882 2,566 544 29 226 253 0 0 5,587 n/a 2,743 2,844 1936 6,543 2,376 244 99 160 261 0 0 6,606 n/a 4,622 1,984 1937 6,550 3,619 142 172 235 263 0 0 7,027 n/a 5,815 1,212 1938 6,856 2,706 923 199 242 260 0 0 8,724 n/a 5,519 3,205 1939 7,598 2,409 634 397 256 251 0 0 11,653 n/a 6,444 5,209 1940 8,732 2,213 368 1,133 599 284 0 0 14,026 n/a 7,411 6,615 1941 11,160 2,215 867 774 586 291 0 0 12,450 n/a 9,365 3,085 1942 15,410 2,193 799 793 485 256 0 0 13,117 n/a 11,129 1,988 1943 20,449 2,303 579 1,360 356 339 0 0 12,886 n/a 11,650 1,236 1944 25,307 2,375 440 1,204 394 402 0 0 14,373 n/a 12,748 1,625 1945 28,515 2,287 977 862 446 495 0 0 15,915 n/a 14,457 1,458 1946 28,952 2,272 393 508 314 607 0 0 16,139 n/a 15,577 562 1947 28,868 1,336 870 392 569 563 0 0 17,899 n/a 16,400 1,499 1948 28,224 1,325 1,123 642 547 590 0 0 20,479 n/a 19,277 1,202 1949 27,600 1,312 821 767 750 706 0 0 16,568 n/a 15,550 1,018 1950 27,741 1,293 668 895 565 714 0 0 17,681 n/a 16,509 1,172 1951 29,206 1,270 247 526 363 746 0 0 20,056 n/a 19,667 389 1952 30,433 1,270 389 550 455 777 0 0 19,950 n/a 20,520 −570 1953 30,781 761 346 423 493 839 0 0 20,160 n/a 19,397 763 1954 30,509 796 563 490 441 907 0 0 18,876 n/a 18,618 258 1955 31,158 767 394 402 554 925 0 0 19,005 n/a 18,903 102 1956 31,790 775 441 322 426 901 0 0 19,059 n/a 19,089 −30 1957 31,834 761 481 356 246 998 0 0 19,034 n/a 19,091 −57 1958 32,193 683 358 272 391 1,122 0 0 18,504 n/a 18,574 −70 1959 32,591 391 504 345 694 841 0 0 18,174 310 18,619 −135 1960 32,869 377 485 217 533 941 0 0 17,081 2,544 18,988 637 1961 33,918 422 465 279 320 1,044 0 0 17,387 2,823 20,114 96 (continued)

188 111th Annual Report | 2024 Table G.5B—continued Factors absorbing reserve funds Deposits with Federal Other Member bank reserves9 Reserve Banks, other than Other Federal Currency Treasury reserve balances Required Period Federal Reserve in cash clearing With Reserve liabilities Currency circulation holdings8 balances Federal Treasury Foreign Other accounts5 and and Required11 Excess11,12 Reserve capital5 coin10 Banks 1962 35,338 380 597 247 393 1,007 0 0 17,454 3,262 20,071 645 1963 37,692 361 880 171 291 1,065 0 0 17,049 4,099 20,677 471 1964 39,619 612 820 229 321 1,036 0 0 18,086 4,151 21,663 574 1965 42,056 760 668 150 355 211 0 0 18,447 4,163 22,848 −238 1966 44,663 1,176 416 174 588 −147 0 0 19,779 4,310 24,321 −232 1967 47,226 1,344 1,123 135 653 −773 0 0 21,092 4,631 25,905 −182 1968 50,961 695 703 216 747 −1,353 0 0 21,818 4,921 27,439 −700 1969 53,950 596 1,312 134 807 0 0 1,919 22,085 5,187 28,173 −901 1970 57,093 431 1,156 148 1,233 0 0 1,986 24,150 5,423 30,033 −460 1971 61,068 460 2,020 294 999 0 0 2,131 27,788 5,743 32,496 1,035 1972 66,516 345 1,855 325 840 0 0 2,143 25,647 6,216 32,044 98 1973 72,497 317 2,542 251 149113 0 0 2,669 27,060 6,781 35,268 −1,360 1974 79,743 185 3,113 418 127513 0 0 2,935 25,843 7,370 37,011 −3,798 1975 86,547 483 7,285 353 1,090 0 0 2,968 26,052 8,036 35,197 −1,10314 1976 93,717 460 10,393 352 1,357 0 0 3,063 25,158 8,628 35,461 −1,535 1977 103,811 392 7,114 379 1,187 0 0 3,292 26,870 9,421 37,615 −1,265 1978 114,645 240 4,196 368 1,256 0 0 4,275 31,152 10,538 42,694 −893 1979 125,600 494 4,075 429 1,412 0 0 4,957 29,792 11,429 44,217 −2,835 1980 136,829 441 3,062 411 617 0 0 4,671 27,456 13,654 40,558 675 1981 144,774 443 4,301 505 781 0 117 5,261 25,111 15,576 42,145 −1,442 1982 154,908 429 5,033 328 1,033 0 436 4,990 26,053 16,666 41,391 1,328 1983 171,935 479 3,661 191 851 0 1,013 5,392 20,413 17,821 39,179 −945 8 Coin and paper currency held by the Treasury, as well as any gold in excess of the gold certificates issued to the Reserve Bank. 9 In November 1979 and thereafter, includes reserves of member banks, Edge Act corporations, and U.S. agencies and branches of foreign banks. On November 13, 1980, and thereafter, includes reserves of all depository institutions. 10Between December 1, 1959, and November 23, 1960, part was allowed as reserves; thereafter, all was allowed. 11Estimated through 1958. Before 1929, data were available only on call dates (in 1920 and 1922 the call date was December 29). Since September 12, 1968, the amount has been based on close-of-business figures for the reserve period two weeks before the report date. 12For the week ending November 15, 1972, and thereafter, includes $450 million of reserve deficiencies on which Federal Reserve Banks are allowed to waive penalties for a transition period in connection with bank adaptation to Regulation J as amended, effective November 9, 1972. Allowable deficiencies are as follows (beginning with first statement week of quarter, in millions): 1973:Q1, $279; Q2, $172; Q3, $112; Q4, $84; 1974:Q1, $67; Q2, $58. The transition period ended with the second quarter of 1974. 13For the period before July 1973, includes certain deposits of domestic nonmember banks and foreign-owned banking institutions held with member banks and redeposited in full with Federal Reserve Banks in connection with voluntary participation by nonmember institutions in the Federal Reserve System program of credit restraint. As of December 12, 1974, the amount of voluntary nonmember bank and foreign-agency and branch deposits at Federal Reserve Banks that are associated with marginal reserves is no longer reported. However, two amounts are reported: (1) deposits voluntarily held as reserves by agencies and branches of foreign banks operating in the United States and (2) Eurodollar liabilities. 14Adjusted to include waivers of penalties for reserve deficiencies, in accordance with change in Board policy, effective November 19, 1975. n/a Not applicable.

Statistical Tables 189 Table G.6. Principal assets and liabilities of insured commercial banks, by class of bank, June 30, 2024 and 2023 Millions of dollars, except as noted Member banks Nonmem- Item Total Total National State ber banks 2024 Loans and investments 16,321,724 13,024,770 10,514,583 2,510,187 3,296,954 Loans, gross 11,337,743 8,722,961 6,958,111 1,764,850 2,614,782 Net 11,335,984 8,721,993 6,957,445 1,764,548 2,613,991 Investments 4,983,981 4,301,809 3,556,472 745,337 682,171 U.S. government securities 1,335,703 1,224,844 1,075,755 149,089 110,859 Other 3,648,278 3,076,965 2,480,717 596,248 571,313 Cash assets, total 2,062,783 1,788,199 1,361,598 426,602 274,584 Deposits, total 16,299,539 13,256,900 10,653,073 2,603,827 3,042,638 Interbank 274,581 249,512 203,587 45,926 25,069 Other transactions 5,847,301 4,829,886 3,671,813 1,158,074 1,017,414 Other nontransactions 10,177,657 8,177,501 6,777,674 1,399,827 2,000,156 Equity capital 2,241,821 1,826,814 1,474,718 352,096 415,007 Number of banks 3,976 1,363 697 666 2,613 2023 Loans and investments 16,002,235 12,680,706 10,334,322 2,346,384 3,321,529 Loans, gross 11,093,598 8,506,055 6,873,360 1,632,695 2,587,543 Net 11,091,897 8,505,192 6,872,801 1,632,391 2,586,705 Investments 4,908,637 4,174,651 3,460,962 713,689 733,986 U.S. government securities 1,186,453 1,072,804 937,116 135,688 113,649 Other 3,722,184 3,101,847 2,523,846 578,001 620,337 Cash assets, total 2,017,543 1,736,694 1,292,155 444,539 280,849 Deposits, total 16,100,360 13,031,368 10,593,233 2,438,135 3,068,992 Interbank 268,855 244,501 198,869 45,632 24,355 Other transactions 5,709,111 4,668,171 3,599,737 1,068,434 1,040,940 Other nontransactions 10,122,394 8,118,696 6,794,626 1,324,070 2,003,697 Equity capital 2,143,219 1,747,361 1,428,569 318,792 395,857 Number of banks 4,065 1,373 712 661 2,692 Note: Includes U.S.-insured commercial banks located in the United States but not U.S.-insured commercial banks operating in U.S. territories or possessions. Data are domestic assets and liabilities (except for those components reported on a consolidated basis only). Components may not sum to totals because of rounding. Data for 2023 have been revised.

190 111th Annual Report | 2024 Table G.7. Initial margin requirements under Regulations T, U, and X Percent of market value Short sales, Effective date Margin stocks Convertible bonds T only1 1934, Oct. 1 25–45 n/a n/a 1936, Feb. 1 25–55 n/a n/a 1936, Apr. 1 55 n/a n/a 1937, Nov. 1 40 n/a 50 1945, Feb. 5 50 n/a 50 1945, July 5 75 n/a 75 1946, Jan. 21 100 n/a 100 1947, Feb. 1 75 n/a 75 1949, Mar. 3 50 n/a 50 1951, Jan. 17 75 n/a 75 1953, Feb. 20 50 n/a 50 1955, Jan. 4 60 n/a 60 1955, Apr. 23 70 n/a 70 1958, Jan. 16 50 n/a 50 1958, Aug. 5 70 n/a 70 1958, Oct. 16 90 n/a 90 1960, July 28 70 n/a 70 1962, July 10 50 n/a 50 1963, Nov. 6 70 n/a 70 1968, Mar. 11 70 50 70 1968, June 8 80 60 80 1970, May 6 65 50 65 1971, Dec. 6 55 50 55 1972, Nov. 24 65 50 65 1974, Jan. 3 50 50 50 Note: These regulations, adopted by the Board of Governors pursuant to the Securities Exchange Act of 1934, limit the amount of credit that may be extended for the purpose of purchasing or carrying margin securities (as defined in the regulations) when the loan is collateralized by such securities. The margin requirement, expressed as a percentage, is the difference between the market value of the securities being purchased or carried (100 percent) and the maximum loan value of the collateral as prescribed by the Board. Regulation T was adopted effective October 1, 1934; Regulation U, effective May 1, 1936; and Regulation X, effective November 1, 1971. The former Regulation G, which was adopted effective March 11, 1968, was merged into Regulation U, effective April 1, 1998. 1 From October 1, 1934, to October 31, 1937, the requirement was the margin “customarily required” by the brokers and dealers. n/a Not applicable.

Statistical Tables 191 Table G.8A. Statement of condition of the Federal Reserve Banks, by Bank, December 31, 2024 and 2023 Millions of dollars Total Boston New York Philadelphia Cleveland Richmond Item 2024 2023 2024 2023 2024 2023 2024 2023 2024 2023 2024 2023 Assets Gold certificates 11,037 11,037 367 361 3,311 3,357 307 315 524 515 791 775 Special drawing rights certificates 15,200 5,200 528 196 4,798 1,818 490 210 709 237 1,120 412 Coin 1,478 1,423 53 48 44 39 167 134 49 54 198 177 Loans and securities Loans to depository institutions 3,255 3,473 119 144 459 122 88 138 75 12 378 474 Other loans 6,373 132,628 328 6,162 420 9,206 77 2,259 860 3,182 436 10,916 Securities purchased under agreements to resell1 0 0 0 0 0 0 0 0 0 0 0 0 Treasury securities, net2,3 4,473,035 4,988,327 93,038 96,374 2,407,122 2,785,732 66,643 82,214 174,426 153,293 445,865 347,135 Federal agency and government-sponsored enterprise mortgagebacked securities, net2 2,277,127 2,481,336 47,363 47,939 1,225,415 1,385,702 33,927 40,896 88,797 76,252 226,981 172,675 Government-sponsored enterprise debt securities, net2,3 2,529 2,557 53 49 1,361 1,428 38 42 99 79 252 178 Total loans and securities 6,762,319 7,608,321 140,901 150,668 3,634,777 4,182,190 100,773 125,549 264,257 232,818 673,912 531,378 Consolidated variable interest entities: Assets held, net4 7,996 16,098 7,996 15,839 0 259 n/a n/a n/a n/a n/a n/a Accrued interest receivable—System Open Market Account 29,941 32,357 624 627 16,103 18,053 447 535 1,171 1,000 2,989 2,263 Foreign currency denominated investments, net5 17,422 18,587 727 800 6,024 6,613 613 668 1,854 1,753 3,437 3,764 Central bank liquidity swaps6 1,120 1,357 47 58 387 483 39 49 119 128 221 275 Other assets Bank premises and equipment, net 3,168 2,897 117 123 527 471 156 161 144 146 479 431 Items in process of collection 88 69 0 0 * * * * 0 0 0 0 Deferred asset—remittances to the Treasury 215,955 133,318 4,383 2,561 130,985 85,206 3,276 1,228 9,703 5,084 34,850 20,396 Interdistrict settlement account 0 0 62,918 19,074 –233,617 –150,680 33,771 –7,801 26,211 68,582 –96,452 100,368 All other assets7 2,989 4,895 94 196 274 393 18 62 93 118 356 431 Total assets 7,068,713 7,835,559 218,755 190,551 3,563,613 4,148,202 140,057 121,110 304,834 310,435 621,901 660,670 Liabilities Federal Reserve notes outstanding 2,784,931 2,706,634 92,743 89,844 817,169 806,499 81,839 75,591 132,978 127,980 196,084 191,807 Less: Notes held by Federal Reserve Bank 462,399 409,583 7,414 10,062 67,456 61,224 25,659 25,098 17,025 17,942 29,008 30,771 Federal Reserve notes outstanding, net 2,322,532 2,297,050 85,329 79,782 749,713 745,275 56,180 50,493 115,953 110,038 167,076 161,036 Securities sold under agreements to repurchase1 888,395 1,390,671 18,478 26,868 478,081 776,620 13,236 22,920 34,643 42,736 88,554 96,776 Deposits Depository institutions 2,892,363 3,134,759 108,465 73,516 1,533,361 1,769,847 68,942 46,039 149,398 152,842 356,465 393,404 Treasury, General Account 721,892 768,590 n/a n/a 721,892 768,590 n/a n/a n/a n/a n/a n/a (continued)

192 111th Annual Report | 2024 Table G.8A—continued Total Boston New York Philadelphia Cleveland Richmond Item 2024 2023 2024 2023 2024 2023 2024 2023 2024 2023 2024 2023 Other deposits8 188,599 187,222 11 54 63,644 70,582 1 1 40 38 538 383 Total deposits 3,802,854 4,090,571 108,476 73,570 2,318,897 2,609,019 68,943 46,040 149,438 152,880 357,003 393,787 Other liabilities Accrued remittances to the Treasury9 0 0 0 0 0 0 0 0 0 0 0 0 Deferred credit items 1,178 624 0 0 0 0 0 0 0 0 0 0 Consolidated variable interest entities: Other liabilities 28 52 28 52 0 0 n/a n/a n/a n/a n/a n/a All other liabilities10 5,404 5,212 232 195 2,094 2,240 176 148 240 222 704 616 Total liabilities 7,020,391 7,784,180 212,543 180,467 3,548,785 4,133,154 138,535 119,601 300,274 305,876 613,337 652,215 Capital accounts Capital paid-in 37,182 36,065 1,571 1,505 12,540 12,469 1,287 1,270 3,856 3,837 7,242 7,116 Surplus (including accumulated other comprehensive loss) 6,785 6,785 286 283 2,288 2,346 235 239 704 722 1,322 1,339 Total Reserve Bank capital 43,967 42,850 1,857 1,788 14,828 14,815 1,522 1,509 4,560 4,559 8,564 8,455 Consolidated variable interest entities formed to administer credit and liquidity facilities: Non-controlling interest 4,355 8,529 4,355 8,296 0 233 n/a n/a n/a n/a n/a n/a Total Reserve Bank capital and consolidated variable interest entities non-controlling interest 48,322 51,379 6,212 10,084 14,828 15,048 1,522 1,509 4,560 4,559 8,564 8,455 Total liabilities and capital accounts 7,068,713 7,835,559 218,755 190,551 3,563,613 4,148,202 140,057 121,110 304,834 310,435 621,901 660,670 Note: Components may not sum to totals because of rounding. 1 Contract amount of agreements. 2 Treasury securities, government-sponsored enterprise (GSE) debt securities, and federal agency and GSE mortgage-backed securities (MBS) are presented at amortized cost, net of unamortized premiums and unamortized discounts. 3 Treasury securities and GSE debt securities may be lent to primary dealers to facilitate the effective conduct of open market operations. Holdings are presented net of securities lent. 4 The Federal Reserve Bank of Boston is the primary beneficiary of MS Facilities 2020 LLC (Main Street Lending Program), and the Federal Reserve Bank of New York is the primary beneficiary of Municipal Liquidity Facility LLC and Term Asset- Backed Securities Loan Facility II LLC. As a result, the accounts and results of operations of those LLCs are included in the combined financial statements of the Federal Reserve Banks. 5 Valued daily at market exchange rates. 6 Dollar value of foreign currency held under these agreements valued at the exchange rate to be used when the foreign currency is returned to the foreign central bank. This exchange rate equals the market exchange rate used when the foreign currency was acquired from the foreign central bank. 7 Includes depository institution overdrafts. 8 Includes deposits of GSEs and international and designated financial market utilities, certain deposit accounts for services provided by the Reserve Banks as fiscal agents of the United States, and foreign official deposit accounts. 9 Represents the estimated weekly remittances to the U.S. Treasury. 10Includes accrued benefit costs and cash collateral posted by counterparties under commitments to purchase and sell federal agency and GSE MBS. * Less than $500,000. n/a Not applicable.

Statistical Tables 193 Table G.8A. Statement of condition of the Federal Reserve Banks, by Bank, December 31, 2024 and 2023—continued Millions of dollars Atlanta Chicago St. Louis Minneapolis Kansas City Dallas San Francisco Item 2024 2023 2024 2023 2024 2023 2024 2023 2024 2023 2024 2023 2024 2023 Assets Gold certificates 1,614 1,633 684 680 334 329 182 174 307 299 1,029 1,008 1,587 1,591 Special drawing rights certificates 2,116 654 1,042 424 452 150 256 90 431 153 1,232 282 2,026 574 Coin 108 101 247 252 35 34 57 54 96 97 192 177 230 257 Loans and securities Loans to depository institutions 73 313 249 95 63 277 33 318 89 48 244 477 1,386 1,055 Other loans 606 9,919 465 8,924 380 7,867 864 7,611 270 8,418 552 13,487 1,113 44,678 Securities purchased under agreements to resell1 0 0 0 0 0 0 0 0 0 0 0 0 0 0 Treasury securities, net2,3 299,264 337,930 246,857 310,954 62,591 74,622 27,944 33,823 49,182 64,494 195,334 243,216 404,769 458,541 Federal agency and government-sponsored enterprise mortgagebacked securities, net2 152,349 168,096 125,670 154,678 31,864 37,119 14,226 16,825 25,038 32,081 99,440 120,983 206,060 228,091 Government-sponsored enterprise debt securities, net2,3 169 173 140 159 35 38 16 17 28 33 110 125 229 235 Total loans and securities 452,461 516,431 373,381 474,810 94,933 119,923 43,083 58,594 74,607 105,074 295,680 378,288 613,557 732,600 Consolidated variable interest entities: Assets held, net4 n/a n/a n/a n/a n/a n/a n/a n/a n/a n/a n/a n/a n/a n/a Accrued interest receivable—System Open Market Account 2,002 2,189 1,652 2,015 419 485 187 219 329 418 1,307 1,575 2,711 2,979 Foreign currency denominated investments, net5 571 557 855 647 392 418 109 118 190 197 419 392 2,231 2,660 Central bank liquidity swaps6 37 41 55 47 25 31 7 9 12 14 27 29 143 194 Other assets Bank premises and equipment, net 328 259 226 228 114 108 114 115 263 252 266 254 434 350 Items in process of collection 88 68 0 0 0 0 0 0 0 0 0 0 0 0 Deferred asset—remittances to the Treasury 0 386 15,583 9,789 43 61 323 215 851 491 1,471 1,711 15,081 6,191 Interdistrict settlement account 33,416 –11,406 10,844 –63,151 16,593 –5,274 9,095 –3,763 776 –11,024 44,306 –33,248 92,139 98,323 All other assets7 1,371 1,217 63 166 145 190 156 300 149 326 83 282 185 1,212 Total assets 494,112 512,130 404,632 425,907 113,485 116,455 53,569 56,125 78,011 96,297 346,012 350,750 730,324 846,931 Liabilities Federal Reserve notes outstanding 399,096 395,722 173,020 167,274 87,400 81,908 49,328 44,757 79,026 75,426 268,083 256,949 408,167 392,876 Less: Notes held by Federal Reserve Bank 34,529 38,966 64,566 43,786 9,234 8,932 18,741 11,745 46,215 27,494 66,603 66,860 75,950 66,703 Federal Reserve notes outstanding, net 364,567 356,756 108,454 123,488 78,166 72,976 30,587 33,012 32,811 47,932 201,480 190,089 332,217 326,173 Securities sold under agreements to repurchase1 59,437 94,210 49,029 86,689 12,431 20,803 5,550 9,429 9,768 17,980 38,795 67,805 80,392 127,834 Deposits Depository institutions 66,482 58,701 120,256 97,642 21,592 21,553 16,849 13,171 34,739 29,671 104,141 91,466 311,674 386,906 Treasury, General Account n/a n/a n/a n/a n/a n/a n/a n/a n/a n/a n/a n/a n/a n/a (continued)

194 111th Annual Report | 2024 Table G.8A—continued Atlanta Chicago St. Louis Minneapolis Kansas City Dallas San Francisco Item 2024 2023 2024 2023 2024 2023 2024 2023 2024 2023 2024 2023 2024 2023 Other deposits8 28 138 124,017 115,614 14 18 168 135 34 88 67 139 36 31 Total deposits 66,510 58,839 244,273 213,256 21,606 21,571 17,017 13,306 34,773 29,759 104,208 91,605 311,710 386,937 Other liabilities Accrued remittances to the Treasury9 593 0 0 0 0 0 0 0 0 0 0 0 0 0 Deferred credit items 1,177 624 0 0 0 0 0 0 * 0 0 0 0 0 Consolidated variable interest entities: Other liabilities n/a n/a n/a n/a n/a n/a n/a n/a n/a n/a n/a n/a n/a n/a All other liabilities10 338 297 421 370 168 140 132 110 172 159 246 221 482 501 Total liabilities 492,622 510,726 402,177 423,803 112,371 115,490 53,286 55,857 77,524 95,830 344,729 349,720 724,801 841,445 Capital accounts Capital paid-in 1,260 1,182 2,076 1,771 942 812 239 226 412 393 1,085 867 4,671 4,617 Surplus (including accumulated other comprehensive loss) 230 222 379 333 172 153 44 42 75 74 198 163 852 869 Total Reserve Bank capital 1,490 1,404 2,455 2,104 1,114 965 283 268 487 467 1,283 1,030 5,523 5,486 Consolidated variable interest entities formed to administer credit and liquidity facilities: Non-controlling interest n/a n/a n/a n/a n/a n/a n/a n/a n/a n/a n/a n/a n/a n/a Total Reserve Bank capital and consolidated variable interest entities non-controlling interest 1,490 1,404 2,455 2,104 1,114 965 283 268 487 467 1,283 1,030 5,523 5,486 Total liabilities and capital accounts 494,112 512,130 404,632 425,907 113,485 116,455 53,569 56,125 78,011 96,297 346,012 350,750 730,324 846,931 Note: Components may not sum to totals because of rounding. 1 Contract amount of agreements. 2 Treasury securities, government-sponsored enterprise (GSE) debt securities, and federal agency and GSE mortgage-backed securities (MBS) are presented at amortized cost, net of unamortized premiums and unamortized discounts. 3 Treasury securities and GSE debt securities may be lent to primary dealers to facilitate the effective conduct of open market operations. Holdings are presented net of securities lent. 4 The Federal Reserve Bank of Boston is the primary beneficiary of MS Facilities 2020 LLC (Main Street Lending Program), and the Federal Reserve Bank of New York is the primary beneficiary of Municipal Liquidity Facility LLC and Term Asset- Backed Securities Loan Facility II LLC. As a result, the accounts and results of operations of those LLCs are included in the combined financial statements of the Federal Reserve Banks. 5 Valued daily at market exchange rates. 6 Dollar value of foreign currency held under these agreements valued at the exchange rate to be used when the foreign currency is returned to the foreign central bank. This exchange rate equals the market exchange rate used when the foreign currency was acquired from the foreign central bank. 7 Includes depository institution overdrafts. 8 Includes deposits of GSEs and international and designated financial market utilities, certain deposit accounts for services provided by the Reserve Banks as fiscal agents of the United States, and foreign official deposit accounts. 9 Represents the estimated weekly remittances to the U.S. Treasury. 10Includes accrued benefit costs and cash collateral posted by counterparties under commitments to purchase and sell federal agency and GSE MBS. * Less than $500,000. n/a Not applicable.

Statistical Tables 195 Table G.8B. Statement of condition of the Federal Reserve Banks, December 31, 2024 and 2023 supplemental information—collateral held against Federal Reserve notes: Federal Reserve agents’ accounts Millions of dollars Item 2024 2023 Federal Reserve notes outstanding 2,784,931 2,706,633 Less: Notes held by Federal Reserve Banks not subject to collateralization 462,399 409,583 Collateralized Federal Reserve notes 2,322,532 2,297,050 Collateral for Federal Reserve notes Gold certificates 11,037 11,037 Special drawing rights certificates 15,200 5,200 U.S. Treasury securities1 2,296,295 2,280,813 Total collateral 2,322,532 2,297,050 1 Face value. Includes compensation to adjust for the effect of inflation on the original face value of inflation-indexed securities.

196 111th Annual Report | 2024 Table G.9. Income and expenses of the Federal Reserve Banks, by Bank, 2024 Thousands of dollars Item Total Boston New York Philadelphia Cleveland Richmond Current income Interest income Primary, secondary, and seasonal loans 204,217 8,977 82,643 4,498 147 8,478 Other loans, net 4,916,539 467,317 364,321 105,747 114,722 430,940 Interest income on securities purchased under agreements to resell 828 17 447 12 32 81 Treasury securities, net 100,517,873 2,051,468 54,631,681 1,539,593 3,700,382 9,221,029 Federal agency and governmentsponsored enterprise mortgage-backed securities, net 52,647,654 1,072,290 28,644,241 808,731 1,925,867 4,785,009 Government-sponsored enterprise debt securities, net 130,000 2,650 70,695 1,994 4,770 11,869 Foreign currency denominated investments, net 327,729 13,785 114,149 11,600 33,859 65,095 Central bank liquidity swaps1 10,802 455 3,769 383 1,108 2,149 Total interest income 158,755,642 3,616,959 83,911,946 2,472,558 5,780,887 14,524,650 Income from priced services 524,403 61 173,721 0 0 0 Securities lending fees 42,501 867 23,110 652 1,560 3,883 Other income 1,162 40 998 3 1 1 Total other income 568,066 968 197,829 655 1,561 3,884 Total current income 159,323,708 3,617,927 84,109,775 2,473,213 5,782,448 14,528,534 Net expenses Salaries and other benefits 4,353,361 298,101 855,810 170,591 204,655 662,579 Building 347,283 39,863 73,423 15,281 17,400 34,041 Equipment 264,028 8,696 23,630 9,448 9,652 130,511 Software costs 548,780 31,298 43,823 3,941 17,976 315,948 Recoveries –304,472 –39,427 –18,503 –21,866 –7,533 –22,825 Expenses capitalized2 –160,840 –6,674 –27,953 –2,616 –11,960 –7,141 Other expenses 815,361 161,763 430,098 66,710 72,429 –761,984 Total operating expenses before pension expense and reimbursements 5,863,501 493,620 1,380,328 241,489 302,619 351,129 System pension service costs3 621,001 0 0 0 0 0 Reimbursable services to government agencies –886,395 –3,964 –115,962 –1,754 –110,122 –9,768 Operating expenses 5,598,107 489,656 1,264,366 239,735 192,497 341,361 Interest expense on securities sold under agreements to repurchase 40,288,036 818,448 21,948,653 621,130 1,461,962 3,618,764 Interest to depository institutions and others 186,477,412 3,811,919 104,586,368 3,417,321 8,108,558 23,808,419 Other expenses 66 1 36 1 3 6 Net expenses 232,363,621 5,120,024 127,799,423 4,278,187 9,763,020 27,768,550 Current net income –73,039,913 –1,502,097 –43,689,648 –1,804,974 –3,980,572 –13,240,016 Additions to (+) and deductions from (−) current net income Profit on sales of Treasury securities –37,021 –760 –20,059 –562 –1,388 –3,488 Losses on sales of federal agency and government-sponsored enterprise mortgage-backed securities –69,617 –1,448 –37,468 –1,038 –2,713 –6,933 Foreign currency translation (losses) –1,478,124 –62,659 –518,536 –52,587 –148,244 –295,515 (continued)

Statistical Tables 197 Table G.9—continued Item Total Boston New York Philadelphia Cleveland Richmond Other components of net benefit cost 434,873 3,607 35,990 2,554 3,225 13,608 Net additions or deductions –72,458 –2,058 –36,374 –1,752 –5,782 –12,163 Net additions or deductions to current net income –1,222,347 –63,318 –576,447 –53,385 –154,902 –304,491 Assessments by Board Board expenditures4 1,438,000 60,440 495,537 50,392 152,422 283,742 Cost of currency 1,242,377 55,701 262,940 45,482 81,757 106,243 Consumer Financial Protection Bureau5 663,300 28,008 228,953 23,355 69,767 131,044 Assessments by the Board of Governors 3,343,677 144,149 987,430 119,229 303,946 521,029 Consolidated variable interest entities Net income from consolidated variable interest entities 22,949 22,505 444 0 0 0 Non-controlling interest in consolidated variable interest entities (income), net –36,650 –36,250 –400 0 0 0 Reserve Bank and consolidated variable interest entities net income before providing for remittances to the Treasury –77,619,638 –1,723,309 –45,253,481 –1,977,588 –4,439,420 –14,065,536 Earnings remittances to the Treasury –79,104,507 –1,822,024 –45,779,266 –2,047,746 –4,619,380 –14,453,505 Net (loss) income after providing for remittances to the Treasury 1,484,869 98,715 525,785 70,158 179,960 387,969 Other comprehensive income 138,061 –26,362 –38,070 –17,521 –28,457 –89,793 Comprehensive income 1,622,930 72,353 487,715 52,637 151,503 298,176 Distribution of comprehensive income Dividends on capital stock 1,622,536 68,870 545,345 56,753 169,632 314,174 Transferred to/from surplus and change in accumulated other comprehensive income 0 3,485 –57,633 –4,113 –18,129 –16,996 Remittances transferred to the Treasury6 3,531,982 0 0 0 0 0 Deferred asset (increase) decrease –82,636,489 –1,822,024 –45,779,266 –2,047,746 –4,619,380 –14,453,505 Earnings remittances to the Treasury, net –79,104,507 –1,822,024 –45,779,266 –2,047,746 –4,619,380 –14,453,505 Total distribution of comprehensive income –77,481,971 –1,749,669 –45,291,554 –1,995,106 –4,467,877 –14,156,327 Note: Components may not sum to totals because of rounding. 1 Represents interest income recognized on swap agreements with foreign central banks. 2 Includes expenses for labor and materials capitalized and depreciated or amortized as charges to activities in the periods benefited. 3 Reflects the effect of the Financial Accounting Standards Board’s Codification Topic (ASC 715) Compensation-Retirement Benefits. Pension service costs for the System Retirement Plan is recorded on behalf of the System in the books of the Federal Reserve Bank of Atlanta. 4 For additional details, see the Board of Governors Financial Statements at https://www.federalreserve.gov/aboutthefed/ audited-annual-financial-statements.htm. 5 The Board of Governors assesses the Reserve Banks to fund the operations of the Consumer Financial Protection Bureau. These assessments are allocated to each Reserve Bank based on each Reserve Bank’s capital and surplus balances as of the most recent quarter. 6 Represents excess earnings remitted to the Treasury after providing for the cost of operations, payment of dividends, and reservation of surplus. On a weekly basis, if earnings become less than the cost of operations, payment of dividends, and any amount necessary to maintain surplus, the Reserve Banks suspend weekly remittances to the Treasury and record a deferred asset.

198 111th Annual Report | 2024 Table G.9. Income and expenses of the Federal Reserve Banks, by Bank, 2024—continued Thousands of dollars Item Atlanta Chicago St. Louis Minneapolis Kansas City Dallas San Francisco Current income Interest income Primary, secondary, and seasonal loans 11,148 7,450 7,948 3,453 948 5,525 63,002 Other loans, net 416,798 361,978 262,581 234,025 393,940 486,366 1,277,804 Interest income on securities purchased under agreements to resell 56 46 12 5 9 36 75 Treasury securities, net 6,747,344 5,737,057 1,432,188 642,099 1,156,533 4,524,542 9,133,957 Federal agency and governmentsponsored enterprise mortgage-backed securities, net 3,535,263 3,015,469 751,562 337,100 608,619 2,377,340 4,786,163 Government-sponsored enterprise debt securities, net 8,728 7,433 1,854 831 1,499 5,861 11,816 Foreign currency denominated investments, net 10,507 14,895 7,380 2,057 3,546 7,634 43,222 Central bank liquidity swaps1 344 481 243 68 117 250 1,435 Total interest income 10,730,188 9,144,809 2,463,768 1,219,638 2,165,211 7,407,554 15,317,474 Income from priced services 248,879 101,742 0 0 0 0 0 Securities lending fees 2,853 2,429 606 272 490 1,916 3,863 Other income 27 46 3 8 20 14 1 Total other income 251,759 104,217 609 280 510 1,930 3,864 Total current income 10,981,947 9,249,026 2,464,377 1,219,918 2,165,721 7,409,484 15,321,338 Net expenses Salaries and other benefits 328,927 360,149 281,601 206,775 334,929 236,907 412,337 Building 21,715 33,718 16,314 14,087 22,166 27,715 31,560 Equipment 14,179 13,821 6,611 5,187 11,509 13,032 17,752 Software costs 19,959 10,434 10,415 12,844 35,882 16,706 29,554 Recoveries –16,842 –18,915 –8,225 –11,742 –54,619 –30,824 –53,151 Expenses capitalized2 –3,054 –6,580 –13,770 –12,551 –34,340 –7,004 –27,197 Other expenses 207,996 119,665 181,827 71,853 88,788 65,979 110,237 Total operating expenses before pension expense and reimbursements 572,880 512,292 474,773 286,453 404,315 322,511 521,092 System pension service costs3 621,001 0 0 0 0 0 0 Reimbursable services to government agencies –76,224 –4,741 –248,308 –112,190 –182,300 –18,629 –2,433 Operating expenses 1,117,657 507,551 226,465 174,263 222,015 303,882 518,659 Interest expense on securities sold under agreements to repurchase 2,706,519 2,317,749 576,503 258,722 468,497 1,826,489 3,664,600 Interest to depository institutions and others 3,329,563 11,796,918 1,204,044 819,288 1,735,758 4,735,762 19,123,494 Other expenses 4 4 1 0 1 3 6 Net expenses 7,153,743 14,622,222 2,007,013 1,252,273 2,426,271 6,866,136 23,306,759 Current net income 3,828,204 –5,373,196 457,364 –32,355 –260,550 543,348 –7,985,421 Additions to (+) and deductions from (−) current net income Profit on sales of Treasury securities –2,482 –2,091 –525 –235 –420 –1,651 –3,360 Profit losses on sales of federal agency and governmentsponsored enterprise mortgage-backed securities –4,658 –3,843 –974 –435 –766 –3,041 –6,300 Foreign currency translation (losses) –46,356 –61,906 –33,282 –9,299 –15,892 –33,334 –200,514 Other components of net benefit cost 367,812 11,246 1,166 3,570 –199 1,910 –9,616 (continued)

Statistical Tables 199 Table G.9—continued Item Atlanta Chicago St. Louis Minneapolis Kansas City Dallas San Francisco Net additions or deductions –853 –2,568 –1,180 –307 –550 –1,538 –7,333 Net additions or deductions to current net income 313,463 –59,162 –34,795 –6,706 –17,827 –37,654 –227,123 Assessments by Board Board expenditures4 47,785 70,743 32,518 9,025 15,481 36,520 183,395 Cost of currency 200,614 94,921 42,712 20,725 31,628 100,512 199,142 Consumer Financial Protection Bureau5 22,279 32,201 15,020 4,188 7,286 16,868 84,331 Assessments by the Board of Governors 270,678 197,865 90,250 33,938 54,395 153,900 466,868 Consolidated variable interest entities Net income from consolidated variable interest entities 0 0 0 0 0 0 0 Non-controlling interest in consolidated variable interest entities (income), net 0 0 0 0 0 0 0 Reserve Bank and consolidated variable interest entities net income before providing for remittances to the Treasury 3,870,989 –5,630,223 332,319 –72,999 –332,772 351,794 –8,679,412 Earnings remittances to the Treasury 4,284,483 –5,793,711 245,000 –107,803 –360,293 239,354 –8,889,616 Net (loss) income after providing for remittances to the Treasury –413,494 163,488 87,319 34,804 27,521 112,440 210,204 Other comprehensive income 477,534 –32,759 –28,478 –21,572 –5,566 –29,889 –21,006 Comprehensive income 64,040 130,729 58,841 13,232 21,955 82,551 189,198 Distribution of comprehensive income Dividends on capital stock 56,492 84,911 39,761 12,090 20,616 47,661 206,231 Transferred to/from surplus and change in accumulated other comprehensive income 7,545 45,818 19,080 1,141 1,339 34,892 –16,429 Remittances transferred to the Treasury6 3,898,273 0 226,744 0 0 0 0 Deferred asset (increase) decrease 386,209 –5,793,711 18,256 –107,803 –360,293 239,354 –8,889,616 Earnings remittances to the Treasury, net 4,284,483 –5,793,711 245,000 –107,803 –360,293 239,354 –8,889,616 Total distribution of comprehensive income 4,348,520 –5,662,982 303,841 –94,572 –338,338 321,907 –8,699,814 Note: Components may not sum to totals because of rounding. 1 Represents interest income recognized on swap agreements with foreign central banks. 2 Includes expenses for labor and materials capitalized and depreciated or amortized as charges to activities in the periods benefited. 3 Reflects the effect of the Financial Accounting Standards Board’s Codification Topic (ASC 715) Compensation-Retirement Benefits. Pension service costs for the System Retirement Plan is recorded on behalf of the System in the books of the Federal Reserve Bank of Atlanta. 4 For additional details, see the Board of Governors Financial Statements at https://www.federalreserve.gov/aboutthefed/ audited-annual-financial-statements.htm. 5 The Board of Governors assesses the Reserve Banks to fund the operations of the Consumer Financial Protection Bureau. These assessments are allocated to each Reserve Bank based on each Reserve Bank’s capital and surplus balances as of the most recent quarter. 6 Represents excess earnings remitted to the Treasury after providing for the cost of operations, payment of dividends, and reservation of surplus. On a weekly basis, if earnings become less than the cost of operations, payment of dividends, and any amount necessary to maintain surplus, the Reserve Banks suspend weekly remittances to the Treasury and record a deferred asset.

200 111th Annual Report | 2024 Table G.10. Income and expenses of the Federal Reserve Banks, 1914–2024 Thousands of dollars Assessments by the Distributions to the Trans- Board of Governors U.S. Treasury ferred to/from Federal Net Consumer Other surplus Trans- Reserve additions Financial compre- and Current Net Dividends ferred Bank or Protection hensive Interest on change in income expenses Board paid to/from and deductions Costs of Bureau income Statutory Federal accumuperiod (−)1 expendicurrency and Office (loss) transfers3 Reserve surplus4 lated other tures of notes compre- Financial hensive Research2 income5 All banks 1914–15 2,173 2,018 6 302 n/a n/a n/a 217 n/a n/a n/a n/a 1916 5,218 2,082 −193 192 n/a n/a n/a 1,743 n/a n/a n/a n/a 1917 16,128 4,922 −1,387 238 n/a n/a n/a 6,804 1,134 n/a n/a 1,134 1918 67,584 10,577 −3,909 383 n/a n/a n/a 5,541 n/a n/a n/a 48,334 1919 102,381 18,745 −4,673 595 n/a n/a n/a 5,012 2,704 n/a n/a 70,652 1920 181,297 27,549 −3,744 710 n/a n/a n/a 5,654 60,725 n/a n/a 82,916 1921 122,866 33,722 −6,315 741 n/a n/a n/a 6,120 59,974 n/a n/a 15,993 1922 50,499 28,837 −4,442 723 n/a n/a n/a 6,307 10,851 n/a n/a −660 1923 50,709 29,062 −8,233 703 n/a n/a n/a 6,553 3,613 n/a n/a 2,546 1924 38,340 27,768 −6,191 663 n/a n/a n/a 6,682 114 n/a n/a −3,078 1925 41,801 26,819 −4,823 709 n/a n/a n/a 6,916 59 n/a n/a 2,474 1926 47,600 24,914 −3,638 722 1,714 n/a n/a 7,329 818 n/a n/a 8,464 1927 43,024 24,894 −2,457 779 1,845 n/a n/a 7,755 250 n/a n/a 5,044 1928 64,053 25,401 −5,026 698 806 n/a n/a 8,458 2,585 n/a n/a 21,079 1929 70,955 25,810 −4,862 782 3,099 n/a n/a 9,584 4,283 n/a n/a 22,536 1930 36,424 25,358 −93 810 2,176 n/a n/a 10,269 17 n/a n/a −2,298 1931 29,701 24,843 311 719 1,479 n/a n/a 10,030 n/a n/a n/a −7,058 1932 50,019 24,457 −1,413 729 1,106 n/a n/a 9,282 2,011 n/a n/a 11,021 1933 49,487 25,918 −12,307 800 2,505 n/a n/a 8,874 n/a n/a n/a −917 1934 48,903 26,844 −4,430 1,372 1,026 n/a n/a 8,782 n/a n/a −60 6,510 1935 42,752 28,695 −1,737 1,406 1,477 n/a n/a 8,505 298 n/a 28 607 1936 37,901 26,016 486 1,680 2,178 n/a n/a 7,830 227 n/a 103 353 1937 41,233 25,295 −1,631 1,748 1,757 n/a n/a 7,941 177 n/a 67 2,616 1938 36,261 25,557 2,232 1,725 1,630 n/a n/a 8,019 120 n/a −419 1,862 1939 38,501 25,669 2,390 1,621 1,356 n/a n/a 8,110 25 n/a −426 4,534 1940 43,538 25,951 11,488 1,704 1,511 n/a n/a 8,215 82 n/a −54 17,617 1941 41,380 28,536 721 1,840 2,588 n/a n/a 8,430 141 n/a −4 571 1942 52,663 32,051 −1,568 1,746 4,826 n/a n/a 8,669 198 n/a 50 3,554 1943 69,306 35,794 23,768 2,416 5,336 n/a n/a 8,911 245 n/a 135 40,327 1944 104,392 39,659 3,222 2,296 7,220 n/a n/a 9,500 327 n/a 201 48,410 1945 142,210 41,666 −830 2,341 4,710 n/a n/a 10,183 248 n/a 262 81,970 1946 150,385 50,493 −626 2,260 4,482 n/a n/a 10,962 67 n/a 28 81,467 1947 158,656 58,191 1,973 2,640 4,562 n/a n/a 11,523 36 75,284 87 8,366 1948 304,161 64,280 −34,318 3,244 5,186 n/a n/a 11,920 n/a 166,690 n/a 18,523 1949 316,537 67,931 −12,122 3,243 6,304 n/a n/a 12,329 n/a 193,146 n/a 21,462 (continued)

Statistical Tables 201 Table G.10—continued Assessments by the Distributions to the Trans- Board of Governors U.S. Treasury ferred to/from Federal Net Consumer Other surplus Trans- Reserve additions Financial compre- and Current Net Dividends ferred Bank or Protection hensive Interest on change in income expenses Board paid to/from and deductions Costs of Bureau income Statutory Federal accumuperiod (−)1 expendicurrency and Office (loss) transfers3 Reserve surplus4 lated other tures of notes compre- Financial hensive Research2 income5 1950 275,839 69,822 36,294 3,434 7,316 n/a n/a 13,083 n/a 196,629 n/a 21,849 1951 394,656 83,793 −2,128 4,095 7,581 n/a n/a 13,865 n/a 254,874 n/a 28,321 1952 456,060 92,051 1,584 4,122 8,521 n/a n/a 14,682 n/a 291,935 n/a 46,334 1953 513,037 98,493 −1,059 4,100 10,922 n/a n/a 15,558 n/a 342,568 n/a 40,337 1954 438,486 99,068 −134 4,175 6,490 n/a n/a 16,442 n/a 276,289 n/a 35,888 1955 412,488 101,159 −265 4,194 4,707 n/a n/a 17,712 n/a 251,741 n/a 32,710 1956 595,649 110,240 −23 5,340 5,603 n/a n/a 18,905 n/a 401,556 n/a 53,983 1957 763,348 117,932 −7,141 7,508 6,374 n/a n/a 20,081 n/a 542,708 n/a 61,604 1958 742,068 125,831 124 5,917 5,973 n/a n/a 21,197 n/a 524,059 n/a 59,215 1959 886,226 131,848 98,247 6,471 6,384 n/a n/a 22,722 n/a 910,650 n/a −93,601 1960 1,103,385 139,894 13,875 6,534 7,455 n/a n/a 23,948 n/a 896,816 n/a 42,613 1961 941,648 148,254 3,482 6,265 6,756 n/a n/a 25,570 n/a 687,393 n/a 70,892 1962 1,048,508 161,451 −56 6,655 8,030 n/a n/a 27,412 n/a 799,366 n/a 45,538 1963 1,151,120 169,638 615 7,573 10,063 n/a n/a 28,912 n/a 879,685 n/a 55,864 1964 1,343,747 171,511 726 8,655 17,230 n/a n/a 30,782 n/a 1,582,119 n/a −465,823 1965 1,559,484 172,111 1,022 8,576 23,603 n/a n/a 32,352 n/a 1,296,810 n/a 27,054 1966 1,908,500 178,212 996 9,022 20,167 n/a n/a 33,696 n/a 1,649,455 n/a 18,944 1967 2,190,404 190,561 2,094 10,770 18,790 n/a n/a 35,027 n/a 1,907,498 n/a 29,851 1968 2,764,446 207,678 8,520 14,198 20,474 n/a n/a 36,959 n/a 2,463,629 n/a 30,027 1969 3,373,361 237,828 −558 15,020 22,126 n/a n/a 39,237 n/a 3,019,161 n/a 39,432 1970 3,877,218 276,572 11,442 21,228 23,574 n/a n/a 41,137 n/a 3,493,571 n/a 32,580 1971 3,723,370 319,608 94,266 32,634 24,943 n/a n/a 43,488 n/a 3,356,560 n/a 40,403 1972 3,792,335 347,917 −49,616 35,234 31,455 n/a n/a 46,184 n/a 3,231,268 n/a 50,661 1973 5,016,769 416,879 −80,653 44,412 33,826 n/a n/a 49,140 n/a 4,340,680 n/a 51,178 1974 6,280,091 476,235 −78,487 41,117 30,190 n/a n/a 52,580 n/a 5,549,999 n/a 51,483 1975 6,257,937 514,359 −202,370 33,577 37,130 n/a n/a 54,610 n/a 5,382,064 n/a 33,828 1976 6,623,220 558,129 7,311 41,828 48,819 n/a n/a 57,351 n/a 5,870,463 n/a 53,940 1977 6,891,317 568,851 −177,033 47,366 55,008 n/a n/a 60,182 n/a 5,937,148 n/a 45,728 1978 8,455,309 592,558 −633,123 53,322 60,059 n/a n/a 63,280 n/a 7,005,779 n/a 47,268 1979 10,310,148 625,168 −151,148 50,530 68,391 n/a n/a 67,194 n/a 9,278,576 n/a 69,141 1980 12,802,319 718,033 −115,386 62,231 73,124 n/a n/a 70,355 n/a 11,706,370 n/a 56,821 1981 15,508,350 814,190 −372,879 63,163 82,924 n/a n/a 74,574 n/a 14,023,723 n/a 76,897 1982 16,517,385 926,034 −68,833 61,813 98,441 n/a n/a 79,352 n/a 15,204,591 n/a 78,320 1983 16,068,362 1,023,678 −400,366 71,551 152,135 n/a n/a 85,152 n/a 14,228,816 n/a 106,663 1984 18,068,821 1,102,444 −412,943 82,116 162,606 n/a n/a 92,620 n/a 16,054,095 n/a 161,996 1985 18,131,983 1,127,744 1,301,624 77,378 173,739 n/a n/a 103,029 n/a 17,796,464 n/a 155,253 1986 17,464,528 1,156,868 1,975,893 97,338 180,780 n/a n/a 109,588 n/a 17,803,895 n/a 91,954 (continued)

202 111th Annual Report | 2024 Table G.10—continued Assessments by the Distributions to the Trans- Board of Governors U.S. Treasury ferred to/from Federal Net Consumer Other surplus Trans- Reserve additions Financial compre- and Current Net Dividends ferred Bank or Protection hensive Interest on change in income expenses Board paid to/from and deductions Costs of Bureau income Statutory Federal accumuperiod (−)1 expendicurrency and Office (loss) transfers3 Reserve surplus4 lated other tures of notes compre- Financial hensive Research2 income5 1987 17,633,012 1,146,911 1,796,594 81,870 170,675 n/a n/a 117,499 n/a 17,738,880 n/a 173,771 1988 19,526,431 1,205,960 −516,910 84,411 164,245 n/a n/a 125,616 n/a 17,364,319 n/a 64,971 1989 22,249,276 1,332,161 1,254,613 89,580 175,044 n/a n/a 129,885 n/a 21,646,417 n/a 130,802 1990 23,476,604 1,349,726 2,099,328 103,752 193,007 n/a n/a 140,758 n/a 23,608,398 n/a 180,292 1991 22,553,002 1,429,322 405,729 109,631 261,316 n/a n/a 152,553 n/a 20,777,552 n/a 228,356 1992 20,235,028 1,474,531 −987,788 128,955 295,401 n/a n/a 171,763 n/a 16,774,477 n/a 402,114 1993 18,914,251 1,657,800 −230,268 140,466 355,947 n/a n/a 195,422 n/a 15,986,765 n/a 347,583 1994 20,910,742 1,795,328 2,363,862 146,866 368,187 n/a n/a 212,090 n/a 20,470,011 n/a 282,122 1995 25,395,148 1,818,416 857,788 161,348 370,203 n/a n/a 230,527 n/a 23,389,367 n/a 283,075 1996 25,164,303 1,947,861 −1,676,716 162,642 402,517 n/a n/a 255,884 5,517,716 14,565,624 n/a 635,343 1997 26,917,213 1,976,453 −2,611,570 174,407 364,454 n/a n/a 299,652 20,658,972 0 n/a 831,705 1998 28,149,477 1,833,436 1,906,037 178,009 408,544 n/a n/a 343,014 17,785,942 8,774,994 n/a 731,575 1999 29,346,836 1,852,162 −533,557 213,790 484,959 n/a n/a 373,579 n/a 25,409,736 n/a 479,053 2000 33,963,992 1,971,688 −1,500,027 188,067 435,838 n/a n/a 409,614 n/a 25,343,892 n/a 4,114,865 2001 31,870,721 2,084,708 −1,117,435 295,056 338,537 n/a n/a 428,183 n/a 27,089,222 n/a 517,580 2002 26,760,113 2,227,078 2,149,328 205,111 429,568 n/a n/a 483,596 n/a 24,495,490 n/a 1,068,598 2003 23,792,725 2,462,658 2,481,127 297,020 508,144 n/a n/a 517,705 n/a 22,021,528 n/a 466,796 2004 23,539,942 2,238,705 917,870 272,331 503,784 n/a n/a 582,402 n/a 18,078,003 n/a 2,782,587 2005 30,729,357 2,889,544 −3,576,903 265,742 477,087 n/a n/a 780,863 n/a 21,467,545 n/a 1,271,672 2006 38,410,427 3,263,844 −158,846 301,014 491,962 n/a n/a 871,255 n/a 29,051,678 n/a 4,271,828 2007 42,576,025 3,510,206 198,417 296,125 576,306 n/a 324,481 992,353 n/a 34,598,401 n/a 3,125,533 2008 41,045,582 4,870,374 3,340,628 352,291 500,372 n/a −3,158,808 1,189,626 n/a 31,688,688 n/a 2,626,053 2009 54,463,121 5,978,795 4,820,204 386,400 502,044 n/a 1,006,813 1,428,202 n/a 47,430,237 n/a 4,564,460 2010 79,300,937 6,270,420 9,745,562 422,200 622,846 42,286 45,881 1,582,785 n/a 79,268,124 n/a 883,724 2011 85,241,366 7,316,643 2,015,991 472,300 648,798 281,712 −1,161,848 1,577,284 n/a 75,423,597 n/a 375,175 2012 81,586,102 7,798,353 18,380,835 490,001 722,301 387,279 −52,611 1,637,934 n/a 88,417,936 n/a 460,528 2013 91,149,953 9,134,656 −1,029,750 580,000 701,522 563,200 2,288,811 1,649,277 n/a 79,633,271 n/a 147,088 2014 116,561,512 10,714,872 −2,718,283 590,000 710,807 563,000 −1,611,569 1,685,826 n/a 96,901,695 n/a 1,064,952 2015 114,233,676 11,139,956 −1,305,513 705,000 689,288 489,700 366,145 1,742,745 25,955,921 91,143,493 n/a −18,571,798 2016 111,743,998 17,262,620 −114,255 709,000 700,728 596,200 −183,232 711,423 91,466,545 n/a n/a 0 2017 114,193,573 33,397,138 1,932,579 740,000 723,534 573,000 650,808 783,599 80,559,689 n/a n/a 0 2018 112,861,657 47,353,636 −382,959 838,000 848,807 337,100 41,831 998,703 65,319,280 n/a n/a −3,175,000 2019 103,220,435 45,423,825 −169,458 814,000 836,975 518,600 148,923 713,931 54,892,569 n/a n/a 0 2020 102,036,168 13,454,957 2,266,152 947,000 831,133 517,300 −1,275,509 386,312 86,890,110 n/a n/a 0 2021 123,058,495 11,007,927 −1,489,296 970,000 1,035,105 627,500 1,639,423 583,417 109,024,672 n/a n/a −40,000 2022 170,683,732 107,849,830 −1,207,343 1,015,000 1,053,616 722,200 1,818,927 1,209,101 59,445,569 n/a n/a 0 2023 175,136,109 286,480,845 −131,200 1,144,000 1,047,430 720,500 −275,578 1,488,823 −116,063,336 n/a n/a 0 (continued)

Statistical Tables 203 Table G.10—continued Assessments by the Distributions to the Trans- Board of Governors U.S. Treasury ferred to/from Federal Net Consumer Other surplus Trans- Reserve additions Financial compre- and Current Net Dividends ferred Bank or Protection hensive Interest on change in income expenses Board paid to/from and deductions Costs of Bureau income Statutory Federal accumuperiod (−)1 expendicurrency and Office (loss) transfers3 Reserve surplus4 lated other tures of notes compre- Financial hensive Research2 income5 2024 159,323,708 232,363,621 –1,222,347 1,438,000 1,242,377 663,300 138,061 1,622,536 –79,104,507 n/a n/a 0 Total 1914–20242,589,305,790 914,675,928 36,971,762 17,614,118 22,826,000 7,602,877 750,950 30,722,654 422,500,4701,198,433,402 –4 12,727,3896 Aggregate for each Bank, 1914–2024 Boston 80,852,184 22,122,051 218,563 762,846 1,153,407 335,137 7,953 1,342,741 10,069,668 44,842,511 135 494,876 New York 1,242,761,385 489,201,198 26,533,956 5,358,045 5,650,366 2,508,562 216,098 8,951,276 208,087,862 545,077,826 –433 4,719,091 Philadelphia 72,373,273 19,811,564 667,811 934,097 1,005,442 399,873 36,519 1,945,271 12,272,167 36,308,189 291 401,222 Cleveland 101,001,487 32,172,768 344,519 1,444,162 1,347,136 649,382 38,900 2,411,227 12,735,420 49,612,575 –10 1,005,316 Richmond 186,452,697 86,651,150 1,574,309 3,447,837 1,971,942 1,590,409 68,638 6,153,727 4,581,753 81,295,580 –72 2,422,420 Atlanta 171,334,971 41,205,813 2,074,363 1,001,581 2,768,802 375,017 189,280 1,851,165 50,231,818 75,616,315 5 580,326 Chicago 192,160,301 61,510,185 1,750,993 1,012,895 2,210,401 278,512 59,315 1,760,204 16,593,999 109,806,844 12 795,178 St. Louis 54,713,929 11,620,380 343,953 307,844 778,948 112,156 23,423 525,400 10,291,205 31,149,772 –27 277,727 Minneapolis 30,004,834 8,851,785 409,547 246,428 439,319 45,528 31,999 506,723 4,718,789 15,436,029 65 197,121 Kansas City 59,257,926 14,819,664 537,937 279,198 768,875 78,562 20,548 519,331 8,676,481 34,476,668 –9 195,778 Dallas 110,487,465 31,707,759 1,031,572 441,227 1,552,632 133,573 36,251 779,497 26,684,720 49,889,286 55 324,105 San Francisco 287,905,328 95,001,613 1,484,240 2,377,961 3,178,728 1,096,173 22,027 3,976,091 57,556,591 124,921,807 –17 1,314,232 Total 2,589,305,790 914,675,928 36,971,762 17,614,118 22,826,000 7,602,877 750,950 30,722,654 422,500,4701,198,433,402 –4 12,727,389 Note: Components may not sum to totals because of rounding. 1 For 1987 and subsequent years, includes the cost of services provided to the Treasury by Federal Reserve Banks for which reimbursement was not received. 2 Starting in 2010, as required under the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010, the Board of Governors began assessing the Reserve Banks to fund the operations of the Consumer Financial Protection Bureau and, for a two-year period beginning July 21, 2010, the Office of Financial Research. These assessments are allocated to the Reserve Banks based on each Reserve Bank’s capital and surplus balances as of the most recent quarter. 3 Represents transfers made as a franchise tax from 1917 through 1932; transfers made under section 13b of the Federal Reserve Act from 1935 through 1947; transfers made under section 7 of the Federal Reserve Act for 1996, 1997, and 2015 to present. Starting in 2022, represents earnings remittances to the Treasury, net of the deferred asset change. 4 Transfers made under section 13b of the Federal Reserve Act. 5 Transfers made under section 7 of the Federal Reserve Act. Beginning in 2006, accumulated other comprehensive income is reported as a component of surplus. 6 The $12,727,389 thousand transferred to surplus was reduced by direct charges of $500 thousand for charge-off on Bank premises (1927); $139,300 thousand for contributions to capital of the Federal Deposit Insurance Corporation (1934); $4 thousand net upon elimination of section 13b surplus (1958); $106,000 thousand (1996), $107,000 thousand (1997), and $3,752,000 thousand (2000) transferred to the Treasury as statutorily required; and $1,848,716 thousand related to the implementation of SFAS No. 158 (2006) and was increased by a transfer of $11,131 thousand from reserves for contingencies (1955), leaving a balance of $6,785,000 thousand on December 31, 2021. n/a Not applicable.

204 111th Annual Report | 2024 Table G.11. Operations in principal departments of the Federal Reserve Banks, 2021–24 Operation 2024 2023 2022 2021 Millions of pieces Currency processed 28,768 29,347 29,695 28,172 Currency destroyed 5,276 3,639 3,884 1,351 Coin received 37,015 37,028 31,932 30,370 Checks handled U.S. government checks1 36 40 46 131 Postal money orders 57 62 65 70 Commercial 2,978 3,146 3,374 3,657 Fedwire securities transfers2 29 26 22 19 Fedwire funds transfers3 210 193 196 204 National Settlement 1 1 1 1 FedNow instant payment transfer4 2 * n/a n/a Automated clearinghouse transactions Commercial 20,109 18,858 18,518 17,895 Government 1,848 1,708 1,661 1,959 Millions of dollars Currency processed 740,228 738,523 707,947 657,495 Currency destroyed 91,735 81,914 83,906 20,426 Coin received 3,604 3,500 2,770 2,811 Checks handled U.S. government checks1 175,406 286,054 220,813 272,637 Postal money orders 18,227 19,522 19,467 20,161 Commercial 8,172,937 8,448,698 8,947,734 8,757,539 Fedwire securities transfers2 554,727,113 434,469,882 341,806,733 310,827,220 Fedwire funds transfers3 1,133,419,684 1,087,195,950 1,060,257,294 991,810,545 National Settlement 28,274,424 26,518,830 26,408,526 25,025,757 FedNow instant payment transfer4 38,197 18 n/a n/a Automated clearinghouse transactions Commercial 42,497,390 39,464,185 38,685,527 31,446,232 Government 8,532,630 8,001,098 7,890,609 8,118,875 1 Includes government checks handled electronically (electronic checks). 2 Data on securities transfers do not include reversals. 3 Data on funds transfers do not include non-value transfers. 4 The FedNow Service began operating in July 2023. Data on instant payment transfers do not include non-value transfers. * Less than $500,000. n/a Not applicable.

Statistical Tables 205 Table G.12. Number and annual salaries of officers and employees of the Federal Reserve Banks, December 31, 2024 President Other officers Employees Total Federal Reserve Bank Annual Annual Number Annual Annual (including Branches) salary Number salaries Full Part Temporary/ salaries Number salaries (dollars)1 (dollars)1 time time hourly2 (dollars)1 (dollars)1 Boston 496,700 112 35,238,505 1,159 5 3 171,994,427 1,280 207,729,632 New York 568,100 576 183,650,390 2,408 10 0 399,623,734 2,995 583,842,224 Philadelphia 495,900 72 19,482,000 796 5 16 99,853,117 890 119,831,017 Cleveland 447,500 69 18,466,300 1,001 10 21 118,337,080 1,102 137,250,880 Richmond 462,500 105 27,554,290 1,461 4 7 174,264,581 1,578 202,281,371 Atlanta 476,000 130 35,422,175 1,605 8 24 188,622,072 1,768 224,520,246 Chicago 478,400 166 48,044,580 1,463 14 5 199,077,206 1,649 247,600,186 St. Louis 445,000 105 29,015,700 1,413 9 5 169,996,558 1,533 199,457,258 Minneapolis 496,000 63 17,041,237 1,038 39 19 115,576,110 1,160 133,113,347 Kansas City 444,900 113 27,714,900 1,901 16 3 194,477,818 2,034 222,637,618 Dallas 473,300 100 27,128,120 1,245 8 4 138,536,193 1,358 166,137,613 San Francisco 550,300 130 40,324,650 1,719 7 14 240,291,923 1,871 281,166,873 Federal Reserve Information Technology3 n/a 93 26,274,400 1,654 2 1 242,035,466 1,750 268,309,866 Total 5,834,600 1,834 535,357,247 18,863 137 122 2,452,686,284 20,968 2,993,878,131 Note: Components may not sum to totals because of rounding. 1 Annual salary (excluding outside agency costs) based on salaries effective on December 31, 2024. 2 Temporary/hourly employees are paid by the Bank, generally work less than 780 hours, and are employed on a temporary basis (such as interns). 3 Reflects a subset of National IT employees. n/a Not applicable.

206 111th Annual Report | 2024 Table G.13. Acquisition costs and net book value of the premises of the Federal Reserve Banks and Branches, December 31, 2024 Thousands of dollars Acquisition costs Federal Reserve Bank or Branch Land Buildings Total Net book value Other real estate (including vaults)1 Boston 27,293 247,767 275,060 91,543 n/a New York 137,994 673,523 811,517 429,983 n/a Philadelphia 8,146 178,955 187,101 73,397 n/a Cleveland 4,591 174,550 179,141 81,514 n/a Cincinnati 4,877 37,190 42,067 10,691 n/a Richmond 32,524 211,214 243,738 89,036 n/a Baltimore 7,916 50,348 58,264 23,919 n/a Charlotte 7,884 51,058 58,942 25,309 n/a Atlanta 26,149 173,251 199,400 113,460 n/a Birmingham 5,597 15,329 20,926 10,964 n/a Jacksonville 2,185 34,286 36,471 16,297 n/a New Orleans 3,785 19,586 23,371 10,121 n/a Miami 15,619 105,099 120,718 94,501 n/a Chicago 7,459 292,459 299,918 111,802 n/a Detroit 13,812 80,182 93,994 60,170 n/a St. Louis 9,467 159,510 168,977 75,954 n/a Memphis 2,763 26,674 29,437 12,884 n/a Minneapolis 28,199 135,497 163,696 89,916 n/a Helena 3,316 10,756 14,072 5,854 n/a Kansas City 39,504 224,333 263,837 179,143 n/a Denver 6,054 36,849 42,903 29,321 n/a Omaha 5,605 16,390 21,995 11,688 n/a Dallas 37,960 176,900 214,860 109,214 n/a El Paso 518 8,433 8,951 3,129 n/a Houston 32,893 110,157 143,050 94,053 n/a San Francisco 21,423 177,490 198,913 82,395 n/a Los Angeles 6,306 118,796 125,102 60,920 n/a Salt Lake City 1,294 6,917 8,211 2,086 n/a Seattle 13,101 58,723 71,824 50,365 n/a Total 514,234 3,612,222 4,126,456 2,049,629 n/a 1 Includes expenditures for construction at some offices, pending allocation to appropriate accounts. n/a Not applicable.

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